Current quarter core earnings were
“We are in the midst of a challenging economic environment that includes high inflation, an unprecedented interest rate environment, and a greater expectation of recession,” said
Fourth Quarter Highlights:
- At
December 31, 2022 , total assets were$13.8 billion , a 10% increase compared to$12.6 billion atDecember 31, 2021 . Excluding PPP loans, total assets increased 11% year over year. - Total loans, excluding PPP loans, increased 16% to
$11.4 billion atDecember 31, 2022 compared to$9.8 billion atDecember 31, 2021 . Excluding PPP loans, total commercial loans grew by$1.2 billion or 15% during the previous twelve months. During this period, the Company generated gross commercial loan production of$3.9 billion , of which$2.5 billion was funded, more than offsetting$1.2 billion in non-PPP commercial loan run-off. Funded commercial loan production during the fourth quarter of 2022 was$341.7 million . Total mortgage loans grew$377.5 million during the twelve months endedDecember 31, 2022 . - Deposits increased 3% to
$11.0 billion atDecember 31, 2022 compared to$10.6 billion atDecember 31, 2021 . Brokered time deposits drove a 64% increase in time deposits, which offset the year-over-year declines in all other categories of deposits. Excluding the impact of the increase in brokered time deposits, total deposits declined 4%. - Net interest income for the fourth quarter of 2022 grew
$1.4 million or 1% compared to the fourth quarter of 2021. While loan growth resulted in interest income increasing$35.2 million , it was substantially offset by the$33.9 million growth in interest expense for the comparative periods. Excluding PPP interest and fees, net interest income increased$10.5 million or 11% for the current quarter compared to the prior year quarter. - For the fourth quarter of 2022, the net interest margin was 3.26% compared to 3.51% for the fourth quarter of 2021, and 3.53% for the third quarter of 2022. The decrease in net interest margin for the current quarter compared to the fourth quarter of the prior year and previous quarter was the result of the increase in the rate paid on interest-bearing liabilities outpacing the increase in the yield on interest-earning assets. The overall rate and yield increases were driven by the multiple federal funds rate increases that occurred over the preceding twelve months. Excluding the impact of PPP loan interest and fees and the amortization of fair value marks derived from previous acquisitions, the prior year quarter's net interest margin would have been 3.31% while the current quarter's margin remained at 3.26% and the margin for the prior quarter of the current year would have been 3.50%.
- The provision for credit losses directly attributable to the funded loan portfolio was
$7.9 million for the current quarter compared to the prior year quarter’s provision for credit losses of$1.6 million . In addition, to the current quarter's provision for credit losses, the quarterly provision expense contained a provision charge of$2.9 million associated with unfunded loan commitments. Excluding the provision for unfunded commitments, the provision for the current quarter is a reflection of the impact of the deterioration in forecasted economic metrics and the increased probability of a recession. - The current quarter's non-interest income decreased by 37% or
$8.2 million compared to the prior year quarter. The decrease represents the cumulative result of the impact of the economic environment on mortgage banking activities and wealth management income, the decline in insurance commission income as a result of the disposition of the Company's insurance business during the second quarter of 2022 and lower bank card income due to regulatory restrictions on transaction fees. - Non-interest expense for the current quarter decreased
$1.8 million or 3% compared to the prior year quarter, driven primarily by decreases of$2.1 million in compensation and benefits expense,$1.0 million in occupancy expense and$0.5 million in other non-interest expense. These decreases were partially offset by increases in various other categories of operating expenses. - Reflecting the impact of the increased provisioning for credit losses and the decline in non-interest income, return on average assets (“ROA”) for the quarter ended
December 31, 2022 was 0.98% and return on average tangible common equity (“ROTCE”) was 12.53% compared to 1.41% and 16.07%, respectively, for the fourth quarter of 2021. On a non-GAAP basis, the current quarter's core ROA was 1.02% and core ROTCE was 13.02% compared to core ROA of 1.44% and core ROTCE of 16.49% for the fourth quarter of 2021. - For the fourth quarter of 2022, the GAAP efficiency ratio was 53.23% compared to 51.75% for the fourth quarter of 2021, and 50.66% for the third quarter of 2022. The non-GAAP efficiency ratio for the fourth quarter of 2022 was 51.46% compared to 50.17% for the prior year quarter, and 48.18% for the third quarter of 2022.
Balance Sheet and Credit Quality
Total assets grew 10% to
The tangible common equity ratio decreased to 8.18% of tangible assets at
Non-performing loans include non-accrual loans, accruing loans 90 days or more past due and restructured loans. Credit quality improved at
At
Income Statement Review
Quarterly Results
Net income was
Net interest income increased
The total provision for credit losses was a charge of
For the fourth quarter of 2022, non-interest income decreased
Non-interest expense decreased
For the fourth quarter of 2022, the GAAP efficiency ratio was 53.23% compared to 51.75% for the fourth quarter of 2021, and 50.66% for the third quarter of 2022. The increase in the GAAP efficiency ratio was primarily the result of the 5% decrease in GAAP revenue compared to the 3% decrease in GAAP non-interest expense during the comparative period. The non-GAAP efficiency ratio was 51.46% for the current quarter as compared to 50.17% for the fourth quarter of 2021, and 48.18% for the third quarter of 2022. The increase in the non-GAAP efficiency ratio (reflecting a decrease in efficiency) from the fourth quarter of the prior year to the current year quarter was primarily the result of the 5% decline in non-GAAP revenue, driven chiefly by the decrease in non-GAAP non-interest income, while non-GAAP expenses declined 2%. ROA for the fourth quarter ended
Year-to-Date Results
The Company recorded net income of
For the year ended
The provision for credit losses for the year ended
For the year ended
Non-interest expense decreased 1% to
For the year ended
Explanation of Non-GAAP Financial Measures
This news release contains financial information and performance measures determined by methods other than in accordance with generally accepted accounting principles in
- Tangible common equity and related measures are non-GAAP measures that exclude the impact of goodwill and other intangible assets.
- The non-GAAP efficiency ratio excludes amortization of intangible assets, loss on FHLB redemption, gain on disposal of assets, contingent payment expense, merger, acquisition and disposal expense and investment securities gains and includes tax-equivalent income.
- Core earnings and the related measures of core earnings per diluted common share, core return on average assets and core return on average tangible common equity reflect net income exclusive of merger, acquisition and disposal expense, amortization of intangible assets, loss on FHLB redemption, contingent payment expense, gain on disposal of assets and investment securities gains, on a net of tax basis.
These disclosures should not be viewed as a substitute for financial results in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Please refer to the non-GAAP Reconciliation tables included with this release for a reconciliation of these non-GAAP measures to the most directly comparable GAAP measure.
Conference Call
The Company’s management will host a conference call to discuss its fourth quarter results today at
About
Category: Webcast
Source:
Code: SASR-E
For additional information or questions, please contact:
1-800-399-5919
Email: DSchrider@sandyspringbank.com
PMantua@sandyspringbank.com
Website: www.sandyspringbank.com
Media Contact:
301-570-8331
jschell@sandyspringbank.com
Forward-Looking Statements
Sandy Spring Bancorp’s forward-looking statements are subject to significant risks and uncertainties that may cause actual results to differ materially from those in such statements. These risks and uncertainties include, but are not limited to, the risks identified in our quarterly and annual reports and the following: changes in general business and economic conditions nationally or in the markets that we serve; changes in consumer and business confidence, investor sentiment, or consumer spending or savings behavior; changes in the level of inflation; changes in the demand for loans, deposits and other financial services that we provide; the possibility that future credit losses may be higher than currently expected; the impact of the interest rate environment on our business, financial condition and results of operations; the impact of compliance with changes in laws, regulations and regulatory interpretations, including changes in income taxes; changes in credit ratings assigned to us or our subsidiaries; the ability to realize benefits and cost savings from, and limit any unexpected liabilities associated with, any business combinations; competitive pressures among financial services companies; the ability to attract, develop and retain qualified employees; our ability to maintain the security of our data processing and information technology systems; the impact of changes in accounting policies, including the introduction of new accounting standards; the impact of judicial or regulatory proceedings; the impact of fiscal and governmental policies of
FINANCIAL HIGHLIGHTS - UNAUDITED
Three Months Ended | % Change | Year Ended | % Change | |||||||||||||||||||
(Dollars in thousands, except per share data) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||
Results of operations: | ||||||||||||||||||||||
Net interest income | $ | 106,643 | $ | 105,268 | 1 | % | $ | 427,004 | $ | 424,518 | 1 | % | ||||||||||
Provision/ (credit) for credit losses | 10,801 | 1,585 | N/M | 34,372 | (45,556 | ) | N/M | |||||||||||||||
Non-interest income | 14,297 | 22,536 | (37 | ) | 87,019 | 102,055 | (15 | ) | ||||||||||||||
Non-interest expense | 64,375 | 66,141 | (3 | ) | 257,293 | 260,470 | (1 | ) | ||||||||||||||
Income before income tax expense | 45,764 | 60,078 | (24 | ) | 222,358 | 311,659 | (29 | ) | ||||||||||||||
Net income | 33,980 | 45,404 | (25 | ) | 166,299 | 235,107 | (29 | ) | ||||||||||||||
Net income attributable to common shareholders | $ | 33,866 | $ | 45,114 | (25 | ) | $ | 165,618 | $ | 233,599 | (29 | ) | ||||||||||
Pre-tax pre-provision net income (1) | $ | 56,565 | $ | 61,663 | (8 | ) | $ | 256,730 | $ | 266,103 | (4 | ) | ||||||||||
Return on average assets | 0.98 | % | 1.41 | % | 1.26 | % | 1.83 | % | ||||||||||||||
Return on average common equity | 9.23 | % | 11.87 | % | 11.23 | % | 15.48 | % | ||||||||||||||
Return on average tangible common equity (1) | 12.53 | % | 16.07 | % | 15.24 | % | 21.01 | % | ||||||||||||||
Net interest margin | 3.26 | % | 3.51 | % | 3.44 | % | 3.56 | % | ||||||||||||||
Efficiency ratio - GAAP basis (2) | 53.23 | % | 51.75 | % | 50.05 | % | 49.47 | % | ||||||||||||||
Efficiency ratio - Non-GAAP basis (2) | 51.46 | % | 50.17 | % | 49.66 | % | 46.17 | % | ||||||||||||||
Per share data: | ||||||||||||||||||||||
Basic net income per common share | $ | 0.76 | $ | 0.99 | (23)% | $ | 3.69 | $ | 5.00 | (26)% | ||||||||||||
Diluted net income per common share | $ | 0.76 | $ | 0.99 | (24 | ) | $ | 3.68 | $ | 4.98 | (26 | ) | ||||||||||
Weighted average diluted common shares | 44,828,827 | 45,655,924 | (2 | ) | 45,039,022 | 46,899,085 | (4 | ) | ||||||||||||||
Dividends declared per share | $ | 0.34 | $ | 0.32 | 6 | $ | 1.36 | $ | 1.28 | 6 | ||||||||||||
Book value per common share | $ | 33.23 | $ | 33.68 | (1 | ) | $ | 33.23 | $ | 33.68 | (1 | ) | ||||||||||
Tangible book value per common share (1) | $ | 24.64 | $ | 24.90 | (1 | ) | $ | 24.64 | $ | 24.90 | (1 | ) | ||||||||||
Outstanding common shares | 44,657,054 | 45,118,930 | (1 | ) | 44,657,054 | 45,118,930 | (1 | ) | ||||||||||||||
Financial condition at period-end: | ||||||||||||||||||||||
Investment securities | $ | 1,543,208 | $ | 1,507,062 | 2 | % | $ | 1,543,208 | $ | 1,507,062 | 2 | % | ||||||||||
Loans | 11,396,706 | 9,967,091 | 14 | 11,396,706 | 9,967,091 | 14 | ||||||||||||||||
Assets | 13,833,119 | 12,590,726 | 10 | 13,833,119 | 12,590,726 | 10 | ||||||||||||||||
Deposits | 10,953,421 | 10,624,731 | 3 | 10,953,421 | 10,624,731 | 3 | ||||||||||||||||
Stockholders' equity | 1,483,768 | 1,519,679 | (2 | ) | 1,483,768 | 1,519,679 | (2 | ) | ||||||||||||||
Capital ratios: | ||||||||||||||||||||||
Tier 1 leverage (3) | 9.33 | % | 9.26 | % | 9.33 | % | 9.26 | % | ||||||||||||||
Common equity tier 1 capital to risk-weighted assets (3) | 10.23 | % | 11.91 | % | 10.23 | % | 11.91 | % | ||||||||||||||
Tier 1 capital to risk-weighted assets (3) | 10.23 | % | 11.91 | % | 10.23 | % | 11.91 | % | ||||||||||||||
Total regulatory capital to risk-weighted assets (3) | 14.20 | % | 14.59 | % | 14.20 | % | 14.59 | % | ||||||||||||||
Tangible common equity to tangible assets (4) | 8.18 | % | 9.21 | % | 8.18 | % | 9.21 | % | ||||||||||||||
Average equity to average assets | 10.61 | % | 11.87 | % | 11.20 | % | 11.85 | % | ||||||||||||||
Credit quality ratios: | ||||||||||||||||||||||
Allowance for credit losses to loans | 1.20 | % | 1.10 | % | 1.20 | % | 1.10 | % | ||||||||||||||
Non-performing loans to total loans | 0.35 | % | 0.49 | % | 0.35 | % | 0.49 | % | ||||||||||||||
Non-performing assets to total assets | 0.29 | % | 0.40 | % | 0.29 | % | 0.40 | % | ||||||||||||||
Allowance for credit losses to non-performing loans | 346.15 | % | 223.61 | % | 346.15 | % | 223.61 | % | ||||||||||||||
Annualized net charge-offs to average loans (5) | — | % | 0.01 | % | — | % | 0.11 | % |
(1) | Represents a non-GAAP measure. |
(2) | The efficiency ratio - GAAP basis is non-interest expense divided by net interest income plus non-interest income from the Condensed Consolidated Statements of Income. The traditional efficiency ratio - Non-GAAP basis excludes intangible asset amortization, loss on FHLB redemption, contingent payment expense, and merger, acquisition and disposal expense from non-interest expense; gain on disposal of assets and investment securities gains from non-interest income; and adds the tax-equivalent adjustment to net interest income. See the Reconciliation Table included with these Financial Highlights. |
(3) | Estimated ratio at |
(4) | The tangible common equity to tangible assets ratio is a non-GAAP ratio that divides assets excluding intangible assets into stockholders' equity after deducting intangible assets. See the Reconciliation Table included with these Financial Highlights. |
(5) | Calculation utilizes average loans, excluding residential mortgage loans held-for-sale. |
RECONCILIATION TABLE - UNAUDITED (CONTINUED)
OPERATING EARNINGS - METRICS
Three Months Ended | Year Ended | |||||||||||||||
(Dollars in thousands) | 2022 | 2021 | 2022 | 2021 | ||||||||||||
Core earnings (non-GAAP): | ||||||||||||||||
Net income (GAAP) | $ | 33,980 | $ | 45,404 | $ | 166,299 | $ | 235,107 | ||||||||
Plus/ (less) non-GAAP adjustments (net of tax)(1): | ||||||||||||||||
Merger, acquisition and disposal expense | — | — | 796 | 33 | ||||||||||||
Amortization of intangible assets | 1,049 | 1,197 | 4,333 | 4,908 | ||||||||||||
Loss on FHLB redemption | — | — | — | 6,779 | ||||||||||||
Gain on disposal of assets | — | — | (12,309 | ) | — | |||||||||||
Investment securities (gains)/ losses | 293 | (26 | ) | 257 | (158 | ) | ||||||||||
Contingent payment expense | — | — | 929 | — | ||||||||||||
Core earnings (Non-GAAP) | $ | 35,322 | $ | 46,575 | $ | 160,305 | $ | 246,669 | ||||||||
Core earnings per diluted common share (non-GAAP): | ||||||||||||||||
Weighted average common shares outstanding - diluted (GAAP) | 44,828,827 | 45,655,924 | 45,039,022 | 46,899,085 | ||||||||||||
Earnings per diluted common share (GAAP) | $ | 0.76 | $ | 0.99 | $ | 3.68 | $ | 4.98 | ||||||||
Core earnings per diluted common share (non-GAAP) | $ | 0.79 | $ | 1.02 | $ | 3.56 | $ | 5.26 | ||||||||
Core return on average assets (non-GAAP): | ||||||||||||||||
Average assets (GAAP) | $ | 13,769,472 | $ | 12,791,526 | $ | 13,218,824 | $ | 12,818,202 | ||||||||
Return on average assets (GAAP) | 0.98 | % | 1.41 | % | 1.26 | % | 1.83 | % | ||||||||
Core return on average assets (non-GAAP) | 1.02 | % | 1.44 | % | 1.21 | % | 1.92 | % | ||||||||
Core return on average tangible common equity (non-GAAP): | ||||||||||||||||
Average total stockholders' equity (GAAP) | $ | 1,460,254 | $ | 1,517,793 | $ | 1,480,198 | $ | 1,518,607 | ||||||||
Average goodwill | (363,436 | ) | (370,223 | ) | (366,244 | ) | (370,223 | ) | ||||||||
Average other intangible assets, net | (20,739 | ) | (26,954 | ) | (23,009 | ) | (29,403 | ) | ||||||||
Average tangible common equity (non-GAAP) | $ | 1,076,079 | $ | 1,120,616 | $ | 1,090,945 | $ | 1,118,981 | ||||||||
Return on average tangible common equity (non-GAAP) | 12.53 | % | 16.07 | % | 15.24 | % | 21.01 | % | ||||||||
Core return on average tangible common equity (non-GAAP) | 13.02 | % | 16.49 | % | 14.69 | % | 22.04 | % |
(1) | Tax adjustments have been determined using the combined marginal federal and state rate of 25.47% and 25.64% for 2022 and 2021, respectively. |
RECONCILIATION TABLE - UNAUDITED
Three Months Ended | Year Ended | |||||||||||||||
(Dollars in thousands) | 2022 | 2021 | 2022 | 2021 | ||||||||||||
Pre-tax pre-provision net income: | ||||||||||||||||
Net income (GAAP) | $ | 33,980 | $ | 45,404 | $ | 166,299 | $ | 235,107 | ||||||||
Plus/ (less) non-GAAP adjustments: | ||||||||||||||||
Income tax expense | 11,784 | 14,674 | 56,059 | 76,552 | ||||||||||||
Provision/ (credit) for credit losses | 10,801 | 1,585 | 34,372 | (45,556 | ) | |||||||||||
Pre-tax pre-provision net income (non-GAAP) | $ | 56,565 | $ | 61,663 | $ | 256,730 | $ | 266,103 | ||||||||
Efficiency ratio (GAAP): | ||||||||||||||||
Non-interest expense | $ | 64,375 | $ | 66,141 | $ | 257,293 | $ | 260,470 | ||||||||
Net interest income plus non-interest income | $ | 120,940 | $ | 127,804 | $ | 514,023 | $ | 526,573 | ||||||||
Efficiency ratio (GAAP) | 53.23 | % | 51.75 | % | 50.05 | % | 49.47 | % | ||||||||
Efficiency ratio (Non-GAAP): | ||||||||||||||||
Non-interest expense | $ | 64,375 | $ | 66,141 | $ | 257,293 | $ | 260,470 | ||||||||
Less non-GAAP adjustments: | ||||||||||||||||
Amortization of intangible assets | 1,408 | 1,609 | 5,814 | 6,600 | ||||||||||||
Loss on FHLB redemption | — | — | — | 9,117 | ||||||||||||
Merger, acquisition and disposal expense | — | — | 1,068 | 45 | ||||||||||||
Contingent payment expense | — | — | 1,247 | — | ||||||||||||
Non-interest expense - as adjusted | $ | 62,967 | $ | 64,532 | $ | 249,164 | $ | 244,708 | ||||||||
Net interest income plus non-interest income | $ | 120,940 | $ | 127,804 | $ | 514,023 | $ | 526,573 | ||||||||
Plus non-GAAP adjustment: | ||||||||||||||||
Tax-equivalent income | 1,032 | 862 | 3,841 | 3,703 | ||||||||||||
Less/ (plus) non-GAAP adjustment: | ||||||||||||||||
Investment securities gains/ (losses) | (393 | ) | 34 | (345 | ) | 212 | ||||||||||
Gain on disposal of assets | — | — | 16,516 | — | ||||||||||||
Net interest income plus non-interest income - as adjusted | $ | 122,365 | $ | 128,632 | $ | 501,693 | $ | 530,064 | ||||||||
Efficiency ratio (Non-GAAP) | 51.46 | % | 50.17 | % | 49.66 | % | 46.17 | % | ||||||||
Tangible common equity ratio: | ||||||||||||||||
Total stockholders' equity | $ | 1,483,768 | $ | 1,519,679 | $ | 1,483,768 | $ | 1,519,679 | ||||||||
(363,436 | ) | (370,223 | ) | (363,436 | ) | (370,223 | ) | |||||||||
Other intangible assets, net | (19,855 | ) | (25,920 | ) | (19,855 | ) | (25,920 | ) | ||||||||
Tangible common equity | $ | 1,100,477 | $ | 1,123,536 | $ | 1,100,477 | $ | 1,123,536 | ||||||||
Total assets | $ | 13,833,119 | $ | 12,590,726 | $ | 13,833,119 | $ | 12,590,726 | ||||||||
(363,436 | ) | (370,223 | ) | (363,436 | ) | (370,223 | ) | |||||||||
Other intangible assets, net | (19,855 | ) | (25,920 | ) | (19,855 | ) | (25,920 | ) | ||||||||
Tangible assets | $ | 13,449,828 | $ | 12,194,583 | $ | 13,449,828 | $ | 12,194,583 | ||||||||
Tangible common equity ratio | 8.18 | % | 9.21 | % | 8.18 | % | 9.21 | % | ||||||||
Outstanding common shares | 44,657,054 | 45,118,930 | 44,657,054 | 45,118,930 | ||||||||||||
Tangible book value per common share | $ | 24.64 | $ | 24.90 | $ | 24.64 | $ | 24.90 |
CONDENSED CONSOLIDATED STATEMENTS OF CONDITION - UNAUDITED
(Dollars in thousands) | 2022 | 2021 | ||||||
Assets | ||||||||
Cash and due from banks | $ | 88,152 | $ | 65,630 | ||||
Federal funds sold | 193 | 312 | ||||||
Interest-bearing deposits with banks | 103,887 | 354,078 | ||||||
Cash and cash equivalents | 192,232 | 420,020 | ||||||
Residential mortgage loans held for sale (at fair value) | 11,706 | 39,409 | ||||||
Investments held-to-maturity (fair value of | 259,452 | — | ||||||
Investments available-for-sale (at fair value) | 1,214,538 | 1,465,896 | ||||||
Other investments, at cost | 69,218 | 41,166 | ||||||
Total loans | 11,396,706 | 9,967,091 | ||||||
Less: allowance for credit losses - loans | (136,242 | ) | (109,145 | ) | ||||
Net loans | 11,260,464 | 9,857,946 | ||||||
Premises and equipment, net | 67,070 | 59,685 | ||||||
Other real estate owned | 645 | 1,034 | ||||||
Accrued interest receivable | 41,172 | 34,349 | ||||||
363,436 | 370,223 | |||||||
Other intangible assets, net | 19,855 | 25,920 | ||||||
Other assets | 333,331 | 275,078 | ||||||
Total assets | $ | 13,833,119 | $ | 12,590,726 | ||||
Liabilities | ||||||||
Noninterest-bearing deposits | $ | 3,673,300 | $ | 3,779,630 | ||||
Interest-bearing deposits | 7,280,121 | 6,845,101 | ||||||
Total deposits | 10,953,421 | 10,624,731 | ||||||
Securities sold under retail repurchase agreements and federal funds purchased | 321,967 | 141,086 | ||||||
Advances from FHLB | 550,000 | — | ||||||
Subordinated debt | 370,205 | 172,712 | ||||||
Total borrowings | 1,242,172 | 313,798 | ||||||
Accrued interest payable and other liabilities | 153,758 | 132,518 | ||||||
Total liabilities | 12,349,351 | 11,071,047 | ||||||
Stockholders' equity | ||||||||
Common stock -- par value | 44,657 | 45,119 | ||||||
Additional paid in capital | 734,273 | 751,072 | ||||||
Retained earnings | 836,789 | 732,027 | ||||||
Accumulated other comprehensive loss | (131,951 | ) | (8,539 | ) | ||||
Total stockholders' equity | 1,483,768 | 1,519,679 | ||||||
Total liabilities and stockholders' equity | $ | 13,833,119 | $ | 12,590,726 |
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED
Three Months Ended | Year Ended | ||||||||||||||
(Dollars in thousands, except per share data) | 2022 | 2021 | 2022 | 2021 | |||||||||||
Interest income: | |||||||||||||||
Interest and fees on loans | $ | 135,079 | $ | 103,589 | $ | 462,121 | $ | 423,152 | |||||||
Interest on loans held for sale | 234 | 271 | 738 | 1,736 | |||||||||||
Interest on deposits with banks | 1,427 | 330 | 2,672 | 725 | |||||||||||
Interest and dividends on investment securities: | |||||||||||||||
Taxable | 6,047 | 3,888 | 20,519 | 16,118 | |||||||||||
Tax-advantaged | 2,509 | 1,992 | 9,609 | 8,552 | |||||||||||
Interest on federal funds sold | 4 | 1 | 8 | 1 | |||||||||||
Total interest income | 145,300 | 110,071 | 495,667 | 450,284 | |||||||||||
Interest Expense: | |||||||||||||||
Interest on deposits | 28,276 | 2,820 | 43,854 | 15,022 | |||||||||||
Interest on retail repurchase agreements and federal funds purchased | 1,697 | 43 | 2,929 | 182 | |||||||||||
Interest on advances from FHLB | 4,759 | — | 7,825 | 2,649 | |||||||||||
Interest on subordinated debt | 3,925 | 1,940 | 14,055 | 7,913 | |||||||||||
Total interest expense | 38,657 | 4,803 | 68,663 | 25,766 | |||||||||||
Net interest income | 106,643 | 105,268 | 427,004 | 424,518 | |||||||||||
Provision/ (credit) for credit losses | 10,801 | 1,585 | 34,372 | (45,556 | ) | ||||||||||
Net interest income after provision/ (credit) for credit losses | 95,842 | 103,683 | 392,632 | 470,074 | |||||||||||
Non-interest income: | |||||||||||||||
Investment securities gains/ (losses) | (393 | ) | 34 | (345 | ) | 212 | |||||||||
Gain on disposal of assets | — | — | 16,516 | — | |||||||||||
Service charges on deposit accounts | 2,419 | 2,305 | 9,803 | 8,241 | |||||||||||
Mortgage banking activities | 783 | 3,622 | 6,130 | 24,509 | |||||||||||
Wealth management income | 8,472 | 9,598 | 35,774 | 36,841 | |||||||||||
Insurance agency commissions | — | 1,332 | 2,927 | 7,017 | |||||||||||
Income from bank owned life insurance | 950 | 819 | 3,141 | 3,022 | |||||||||||
Bank card fees | 463 | 1,818 | 4,379 | 6,896 | |||||||||||
Other income | 1,603 | 3,008 | 8,694 | 15,317 | |||||||||||
Total non-interest income | 14,297 | 22,536 | 87,019 | 102,055 | |||||||||||
Non-interest expense: | |||||||||||||||
Salaries and employee benefits | 39,455 | 41,535 | 158,504 | 155,830 | |||||||||||
Occupancy expense of premises | 4,728 | 5,693 | 19,255 | 22,405 | |||||||||||
Equipment expenses | 3,859 | 3,427 | 14,779 | 12,883 | |||||||||||
Marketing | 1,354 | 1,090 | 5,197 | 4,730 | |||||||||||
Outside data services | 2,707 | 2,123 | 10,199 | 8,983 | |||||||||||
1,462 | 991 | 4,792 | 4,294 | ||||||||||||
Amortization of intangible assets | 1,408 | 1,609 | 5,814 | 6,600 | |||||||||||
Merger, acquisition and disposal expense | — | — | 1,068 | 45 | |||||||||||
Professional fees and services | 2,573 | 2,381 | 9,169 | 10,308 | |||||||||||
Other expenses | 6,829 | 7,292 | 28,516 | 34,392 | |||||||||||
Total non-interest expense | 64,375 | 66,141 | 257,293 | 260,470 | |||||||||||
Income before income tax expense | 45,764 | 60,078 | 222,358 | 311,659 | |||||||||||
Income tax expense | 11,784 | 14,674 | 56,059 | 76,552 | |||||||||||
Net income | $ | 33,980 | $ | 45,404 | $ | 166,299 | $ | 235,107 | |||||||
Net income per share amounts: | |||||||||||||||
Basic net income per common share | $ | 0.76 | $ | 0.99 | $ | 3.69 | $ | 5.00 | |||||||
Diluted net income per common share | $ | 0.76 | $ | 0.99 | $ | 3.68 | $ | 4.98 | |||||||
Dividends declared per share | $ | 0.34 | $ | 0.32 | $ | 1.36 | $ | 1.28 |
HISTORICAL TRENDS - QUARTERLY FINANCIAL DATA - UNAUDITED
2022 | 2021 | |||||||||||||||||||||||||||||||
(Dollars in thousands, except per share data) | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 | ||||||||||||||||||||||||
Profitability for the quarter: | ||||||||||||||||||||||||||||||||
Tax-equivalent interest income | $ | 146,332 | $ | 131,373 | $ | 114,901 | $ | 106,902 | $ | 110,933 | $ | 112,060 | $ | 115,753 | $ | 115,241 | ||||||||||||||||
Interest expense | 38,657 | 17,462 | 7,959 | 4,585 | 4,803 | 4,525 | 6,777 | 9,661 | ||||||||||||||||||||||||
Tax-equivalent net interest income | 107,675 | 113,911 | 106,942 | 102,317 | 106,130 | 107,535 | 108,976 | 105,580 | ||||||||||||||||||||||||
Tax-equivalent adjustment | 1,032 | 951 | 992 | 866 | 862 | 931 | 930 | 980 | ||||||||||||||||||||||||
Provision/ (credit) for credit losses | 10,801 | 18,890 | 3,046 | 1,635 | 1,585 | (8,229 | ) | (4,204 | ) | (34,708 | ) | |||||||||||||||||||||
Non-interest income | 14,297 | 16,882 | 35,245 | 20,595 | 22,536 | 24,394 | 26,259 | 28,866 | ||||||||||||||||||||||||
Non-interest expense | 64,375 | 65,780 | 64,991 | 62,147 | 66,141 | 63,181 | 62,975 | 68,173 | ||||||||||||||||||||||||
Income before income tax expense | 45,764 | 45,172 | 73,158 | 58,264 | 60,078 | 76,046 | 75,534 | 100,001 | ||||||||||||||||||||||||
Income tax expense | 11,784 | 11,588 | 18,358 | 14,329 | 14,674 | 19,070 | 18,271 | 24,537 | ||||||||||||||||||||||||
Net income | $ | 33,980 | $ | 33,584 | $ | 54,800 | $ | 43,935 | $ | 45,404 | $ | 56,976 | $ | 57,263 | $ | 75,464 | ||||||||||||||||
GAAP financial performance: | ||||||||||||||||||||||||||||||||
Return on average assets | 0.98 | % | 0.99 | % | 1.69 | % | 1.42 | % | 1.41 | % | 1.75 | % | 1.79 | % | 2.39 | % | ||||||||||||||||
Return on average common equity | 9.23 | % | 8.96 | % | 14.97 | % | 11.83 | % | 11.87 | % | 14.54 | % | 15.07 | % | 20.72 | % | ||||||||||||||||
Return on average tangible common equity | 12.53 | % | 12.10 | % | 20.42 | % | 16.04 | % | 16.07 | % | 19.56 | % | 20.44 | % | 28.47 | % | ||||||||||||||||
Net interest margin | 3.26 | % | 3.53 | % | 3.49 | % | 3.49 | % | 3.51 | % | 3.52 | % | 3.63 | % | 3.56 | % | ||||||||||||||||
Efficiency ratio - GAAP basis | 53.23 | % | 50.66 | % | 46.03 | % | 50.92 | % | 51.75 | % | 48.23 | % | 46.89 | % | 51.08 | % | ||||||||||||||||
Non-GAAP financial performance: | ||||||||||||||||||||||||||||||||
Pre-tax pre-provision net income | $ | 56,565 | $ | 64,062 | $ | 76,204 | $ | 59,899 | $ | 61,663 | $ | 67,817 | $ | 71,330 | $ | 65,293 | ||||||||||||||||
Core after-tax earnings | $ | 35,322 | $ | 35,695 | $ | 44,238 | $ | 45,050 | $ | 46,575 | $ | 58,151 | $ | 58,446 | $ | 83,511 | ||||||||||||||||
Core return on average assets | 1.02 | % | 1.05 | % | 1.37 | % | 1.45 | % | 1.44 | % | 1.79 | % | 1.83 | % | 2.65 | % | ||||||||||||||||
Core return on average common equity | 9.60 | % | 9.53 | % | 12.09 | % | 12.13 | % | 12.17 | % | 14.84 | % | 15.38 | % | 22.93 | % | ||||||||||||||||
Core return on average tangible common equity | 13.02 | % | 12.86 | % | 16.49 | % | 16.45 | % | 16.49 | % | 19.96 | % | 20.87 | % | 31.50 | % | ||||||||||||||||
Core earnings per diluted common share | $ | 0.79 | $ | 0.80 | $ | 0.98 | $ | 0.99 | $ | 1.02 | $ | 1.23 | $ | 1.23 | $ | 1.76 | ||||||||||||||||
Efficiency ratio - Non-GAAP basis | 51.46 | % | 48.18 | % | 49.79 | % | 49.34 | % | 50.17 | % | 46.67 | % | 45.36 | % | 42.65 | % | ||||||||||||||||
Per share data: | ||||||||||||||||||||||||||||||||
Net income attributable to common shareholders | $ | 33,866 | $ | 33,470 | $ | 54,606 | $ | 43,667 | $ | 45,114 | $ | 56,622 | $ | 56,782 | $ | 74,824 | ||||||||||||||||
Basic net income per common share | $ | 0.76 | $ | 0.75 | $ | 1.21 | $ | 0.97 | $ | 0.99 | $ | 1.21 | $ | 1.20 | $ | 1.59 | ||||||||||||||||
Diluted net income per common share | $ | 0.76 | $ | 0.75 | $ | 1.21 | $ | 0.96 | $ | 0.99 | $ | 1.20 | $ | 1.19 | $ | 1.58 | ||||||||||||||||
Weighted average diluted common shares | 44,828,827 | 44,780,560 | 45,111,693 | 45,333,292 | 45,655,924 | 47,086,824 | 47,523,198 | 47,415,060 | ||||||||||||||||||||||||
Dividends declared per share | $ | 0.34 | $ | 0.34 | $ | 0.34 | $ | 0.34 | $ | 0.32 | $ | 0.32 | $ | 0.32 | $ | 0.32 | ||||||||||||||||
Non-interest income: | ||||||||||||||||||||||||||||||||
Securities gains/ (losses) | $ | (393 | ) | $ | 2 | $ | 38 | $ | 8 | $ | 34 | $ | 49 | $ | 71 | $ | 58 | |||||||||||||||
Gain/ (loss) on disposal of assets | — | (183 | ) | 16,699 | — | — | — | — | — | |||||||||||||||||||||||
Service charges on deposit accounts | 2,419 | 2,591 | 2,467 | 2,326 | 2,305 | 2,108 | 1,976 | 1,852 | ||||||||||||||||||||||||
Mortgage banking activities | 783 | 1,566 | 1,483 | 2,298 | 3,622 | 4,942 | 5,776 | 10,169 | ||||||||||||||||||||||||
Wealth management income | 8,472 | 8,867 | 9,098 | 9,337 | 9,598 | 9,392 | 9,121 | 8,730 | ||||||||||||||||||||||||
Insurance agency commissions | — | — | 812 | 2,115 | 1,332 | 2,285 | 1,247 | 2,153 | ||||||||||||||||||||||||
Income from bank owned life insurance | 950 | 693 | 703 | 795 | 819 | 818 | 705 | 680 | ||||||||||||||||||||||||
Bank card fees | 463 | 438 | 1,810 | 1,668 | 1,818 | 1,775 | 1,785 | 1,518 | ||||||||||||||||||||||||
Other income | 1,603 | 2,908 | 2,135 | 2,048 | 3,008 | 3,025 | 5,578 | 3,706 | ||||||||||||||||||||||||
Total non-interest income | $ | 14,297 | $ | 16,882 | $ | 35,245 | $ | 20,595 | $ | 22,536 | $ | 24,394 | $ | 26,259 | $ | 28,866 | ||||||||||||||||
Non-interest expense: | ||||||||||||||||||||||||||||||||
Salaries and employee benefits | $ | 39,455 | $ | 40,126 | $ | 39,550 | $ | 39,373 | $ | 41,535 | $ | 38,653 | $ | 38,990 | $ | 36,652 | ||||||||||||||||
Occupancy expense of premises | 4,728 | 4,759 | 4,734 | 5,034 | 5,693 | 5,728 | 5,497 | 5,487 | ||||||||||||||||||||||||
Equipment expenses | 3,859 | 3,825 | 3,559 | 3,536 | 3,427 | 3,214 | 3,020 | 3,222 | ||||||||||||||||||||||||
Marketing | 1,354 | 1,370 | 1,280 | 1,193 | 1,090 | 1,376 | 1,052 | 1,212 | ||||||||||||||||||||||||
Outside data services | 2,707 | 2,509 | 2,564 | 2,419 | 2,123 | 2,317 | 2,260 | 2,283 | ||||||||||||||||||||||||
1,462 | 1,268 | 1,078 | 984 | 991 | 361 | 1,450 | 1,492 | |||||||||||||||||||||||||
Amortization of intangible assets | 1,408 | 1,432 | 1,466 | 1,508 | 1,609 | 1,635 | 1,659 | 1,697 | ||||||||||||||||||||||||
Merger, acquisition and disposal expense | — | 1 | 1,067 | — | — | — | — | 45 | ||||||||||||||||||||||||
Professional fees and services | 2,573 | 2,207 | 2,372 | 2,017 | 2,381 | 3,031 | 3,165 | 1,731 | ||||||||||||||||||||||||
Other expenses | 6,829 | 8,283 | 7,321 | 6,083 | 7,292 | 6,866 | 5,882 | 14,352 | ||||||||||||||||||||||||
Total non-interest expense | $ | 64,375 | $ | 65,780 | $ | 64,991 | $ | 62,147 | $ | 66,141 | $ | 63,181 | $ | 62,975 | $ | 68,173 |
HISTORICAL TRENDS - QUARTERLY FINANCIAL DATA - UNAUDITED
2022 | 2021 | |||||||||||||||||||||||||||||||
(Dollars in thousands, except per share data) | Q4 | Q3 | Q2 | Q1 | Q4 | Q3 | Q2 | Q1 | ||||||||||||||||||||||||
Balance sheets at quarter end: | ||||||||||||||||||||||||||||||||
Commercial investor real estate loans | $ | 5,130,094 | $ | 5,066,843 | $ | 4,761,658 | $ | 4,388,275 | $ | 4,141,346 | $ | 3,743,698 | $ | 3,712,374 | $ | 3,652,418 | ||||||||||||||||
Commercial owner-occupied real estate loans | 1,775,037 | 1,743,724 | 1,767,326 | 1,692,253 | 1,690,881 | 1,661,092 | 1,687,843 | 1,644,848 | ||||||||||||||||||||||||
Commercial AD&C loans | 1,090,028 | 1,143,783 | 1,094,528 | 1,089,331 | 1,088,094 | 1,177,949 | 1,126,960 | 1,051,013 | ||||||||||||||||||||||||
Commercial business loans | 1,455,885 | 1,393,634 | 1,353,380 | 1,349,602 | 1,481,834 | 1,594,528 | 1,974,366 | 2,411,109 | ||||||||||||||||||||||||
Residential mortgage loans | 1,287,933 | 1,218,552 | 1,147,577 | 1,000,697 | 937,570 | 911,997 | 960,527 | 1,022,546 | ||||||||||||||||||||||||
Residential construction loans | 224,772 | 229,243 | 235,486 | 204,259 | 197,652 | 181,319 | 172,869 | 171,028 | ||||||||||||||||||||||||
Consumer loans | 432,957 | 423,034 | 426,335 | 419,911 | 429,714 | 450,765 | 457,576 | 493,904 | ||||||||||||||||||||||||
Total loans | 11,396,706 | 11,218,813 | 10,786,290 | 10,144,328 | 9,967,091 | 9,721,348 | 10,092,515 | 10,446,866 | ||||||||||||||||||||||||
Allowance for credit losses - loans | (136,242 | ) | (128,268 | ) | (113,670 | ) | (110,588 | ) | (109,145 | ) | (107,920 | ) | (123,961 | ) | (130,361 | ) | ||||||||||||||||
Loans held for sale | 11,706 | 11,469 | 23,610 | 17,537 | 39,409 | 44,678 | 71,082 | 84,930 | ||||||||||||||||||||||||
Investment securities | 1,543,208 | 1,587,279 | 1,595,424 | 1,586,441 | 1,507,062 | 1,470,652 | 1,482,123 | 1,472,727 | ||||||||||||||||||||||||
Total assets | 13,833,119 | 13,765,597 | 13,303,009 | 12,967,416 | 12,590,726 | 13,017,464 | 12,925,577 | 12,873,366 | ||||||||||||||||||||||||
Noninterest-bearing demand deposits | 3,673,300 | 3,993,480 | 4,129,440 | 4,039,797 | 3,779,630 | 3,987,411 | 4,000,636 | 3,770,852 | ||||||||||||||||||||||||
Total deposits | 10,953,421 | 10,749,486 | 10,969,461 | 10,852,794 | 10,624,731 | 10,987,400 | 10,866,466 | 10,677,752 | ||||||||||||||||||||||||
Customer repurchase agreements | 61,967 | 91,287 | 110,744 | 130,784 | 141,086 | 147,504 | 140,708 | 129,318 | ||||||||||||||||||||||||
Total stockholders' equity | 1,483,768 | 1,451,862 | 1,477,169 | 1,488,910 | 1,519,679 | 1,546,060 | 1,562,280 | 1,511,694 | ||||||||||||||||||||||||
Quarterly average balance sheets: | ||||||||||||||||||||||||||||||||
Commercial investor real estate loans | $ | 5,082,697 | $ | 4,898,683 | $ | 4,512,937 | $ | 4,220,246 | $ | 3,769,529 | $ | 3,678,886 | $ | 3,675,119 | $ | 3,634,174 | ||||||||||||||||
Commercial owner-occupied real estate loans | 1,753,351 | 1,755,891 | 1,727,325 | 1,683,557 | 1,669,737 | 1,671,442 | 1,663,543 | 1,638,885 | ||||||||||||||||||||||||
Commercial AD&C loans | 1,136,780 | 1,115,531 | 1,096,369 | 1,102,660 | 1,140,059 | 1,161,183 | 1,089,287 | 1,049,597 | ||||||||||||||||||||||||
Commercial business loans | 1,373,565 | 1,327,218 | 1,334,350 | 1,372,755 | 1,482,901 | 1,820,598 | 2,225,885 | 2,291,097 | ||||||||||||||||||||||||
Residential mortgage loans | 1,251,829 | 1,177,664 | 1,070,836 | 964,056 | 925,093 | 934,365 | 994,899 | 1,066,714 | ||||||||||||||||||||||||
Residential construction loans | 231,318 | 235,123 | 221,031 | 197,366 | 186,129 | 170,511 | 176,135 | 179,925 | ||||||||||||||||||||||||
Consumer loans | 426,134 | 422,963 | 421,022 | 424,859 | 436,030 | 452,289 | 468,686 | 496,578 | ||||||||||||||||||||||||
Total loans | 11,255,674 | 10,933,073 | 10,383,870 | 9,965,499 | 9,609,478 | 9,889,274 | 10,293,554 | 10,356,970 | ||||||||||||||||||||||||
Loans held for sale | 10,901 | 15,211 | 12,744 | 17,594 | 29,426 | 50,075 | 66,958 | 82,263 | ||||||||||||||||||||||||
Investment securities | 1,717,455 | 1,734,036 | 1,686,181 | 1,617,615 | 1,535,265 | 1,403,496 | 1,482,905 | 1,407,455 | ||||||||||||||||||||||||
Interest-earning assets | 13,134,234 | 12,833,758 | 12,283,834 | 11,859,803 | 12,012,576 | 12,121,048 | 12,037,701 | 12,029,424 | ||||||||||||||||||||||||
Total assets | 13,769,472 | 13,521,595 | 12,991,692 | 12,576,089 | 12,791,526 | 12,886,460 | 12,798,355 | 12,801,539 | ||||||||||||||||||||||||
Noninterest-bearing demand deposits | 3,833,275 | 3,995,702 | 4,001,762 | 3,758,732 | 3,879,572 | 3,869,293 | 3,763,135 | 3,394,110 | ||||||||||||||||||||||||
Total deposits | 11,025,843 | 10,740,999 | 10,829,221 | 10,542,029 | 10,809,665 | 10,832,115 | 10,663,346 | 10,343,190 | ||||||||||||||||||||||||
Customer repurchase agreements | 74,797 | 104,742 | 122,728 | 131,487 | 144,988 | 145,483 | 136,286 | 148,195 | ||||||||||||||||||||||||
Total interest-bearing liabilities | 8,310,278 | 7,892,230 | 7,377,045 | 7,163,641 | 7,247,756 | 7,315,021 | 7,356,656 | 7,742,987 | ||||||||||||||||||||||||
Total stockholders' equity | 1,460,254 | 1,486,427 | 1,468,036 | 1,506,516 | 1,517,793 | 1,554,765 | 1,523,875 | 1,477,150 | ||||||||||||||||||||||||
Financial measures: | ||||||||||||||||||||||||||||||||
Average equity to average assets | 10.61 | % | 10.99 | % | 11.30 | % | 11.98 | % | 11.87 | % | 12.07 | % | 11.91 | % | 11.54 | % | ||||||||||||||||
Average investment securities to average earning assets | 13.08 | % | 13.51 | % | 13.73 | % | 13.64 | % | 12.78 | % | 11.58 | % | 12.32 | % | 11.70 | % | ||||||||||||||||
Average loans to average earning assets | 85.70 | % | 85.19 | % | 84.53 | % | 84.03 | % | 80.00 | % | 81.59 | % | 85.51 | % | 86.10 | % | ||||||||||||||||
Loans to assets | 82.39 | % | 81.50 | % | 81.08 | % | 78.23 | % | 79.16 | % | 74.68 | % | 78.08 | % | 81.15 | % | ||||||||||||||||
Loans to deposits | 104.05 | % | 104.37 | % | 98.33 | % | 93.47 | % | 93.81 | % | 88.48 | % | 92.88 | % | 97.84 | % | ||||||||||||||||
Assets under management | $ | 5,255,306 | $ | 4,969,092 | $ | 5,171,321 | $ | 5,793,787 | $ | 6,078,204 | $ | 5,733,311 | $ | 5,676,141 | $ | 5,401,158 | ||||||||||||||||
Capital measures: | ||||||||||||||||||||||||||||||||
Tier 1 leverage (1) | 9.33 | % | 9.33 | % | 9.53 | % | 9.66 | % | 9.26 | % | 9.33 | % | 9.49 | % | 9.14 | % | ||||||||||||||||
Common equity tier 1 capital to risk-weighted assets (1) | 10.23 | % | 10.18 | % | 10.42 | % | 10.78 | % | 11.91 | % | 12.53 | % | 12.49 | % | 12.11 | % | ||||||||||||||||
Tier 1 capital to risk-weighted assets (1) | 10.23 | % | 10.18 | % | 10.42 | % | 10.78 | % | 11.91 | % | 12.53 | % | 12.49 | % | 12.11 | % | ||||||||||||||||
Total regulatory capital to risk-weighted assets (1) | 14.20 | % | 14.15 | % | 14.46 | % | 15.02 | % | 14.59 | % | 15.30 | % | 15.85 | % | 15.52 | % | ||||||||||||||||
Book value per common share | $ | 33.23 | $ | 32.52 | $ | 33.10 | $ | 32.97 | $ | 33.68 | $ | 33.52 | $ | 33.02 | $ | 32.04 | ||||||||||||||||
Outstanding common shares | 44,657,054 | 44,644,269 | 44,629,697 | 45,162,908 | 45,118,930 | 46,119,074 | 47,312,982 | 47,187,389 |
(1) | Estimated ratio at |
LOAN PORTFOLIO QUALITY DETAIL - UNAUDITED
2022 | 2021 | |||||||||||||||||||||||
(Dollars in thousands) | ||||||||||||||||||||||||
Non-performing assets: | ||||||||||||||||||||||||
Loans 90 days past due: | ||||||||||||||||||||||||
Commercial real estate: | ||||||||||||||||||||||||
Commercial investor real estate | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 14,830 | $ | — | $ | — | ||||||||
Commercial owner-occupied real estate | — | — | — | — | — | — | — | — | ||||||||||||||||
Commercial AD&C | — | — | — | — | — | 7,344 | — | — | ||||||||||||||||
Commercial business | 1,002 | 1,966 | — | — | — | — | — | 31 | ||||||||||||||||
Residential real estate: | ||||||||||||||||||||||||
Residential mortgage | — | 167 | 353 | 296 | 557 | 679 | 680 | 398 | ||||||||||||||||
Residential construction | — | — | — | — | — | — | — | — | ||||||||||||||||
Consumer | — | 34 | — | — | — | — | — | — | ||||||||||||||||
Total loans 90 days past due | 1,002 | 2,167 | 353 | 296 | 557 | 22,853 | 680 | 429 | ||||||||||||||||
Non-accrual loans: | ||||||||||||||||||||||||
Commercial real estate: | ||||||||||||||||||||||||
Commercial investor real estate | 9,943 | 14,038 | 11,245 | 11,743 | 12,489 | 15,386 | 42,072 | 42,776 | ||||||||||||||||
Commercial owner-occupied real estate | 5,019 | 6,294 | 7,869 | 8,083 | 9,306 | 9,854 | 8,183 | 8,316 | ||||||||||||||||
Commercial AD&C | — | — | 1,353 | 1,081 | 650 | 1,022 | 14,489 | 14,975 | ||||||||||||||||
Commercial business | 7,322 | 7,198 | 7,542 | 8,357 | 8,420 | 9,454 | 9,435 | 13,147 | ||||||||||||||||
Residential real estate: | ||||||||||||||||||||||||
Residential mortgage | 7,439 | 7,514 | 7,305 | 8,148 | 8,441 | 9,511 | 9,440 | 9,593 | ||||||||||||||||
Residential construction | — | — | 1 | 51 | 55 | 62 | 62 | — | ||||||||||||||||
Consumer | 5,059 | 5,173 | 5,692 | 6,406 | 6,725 | 7,826 | 7,718 | 7,193 | ||||||||||||||||
Total non-accrual loans | 34,782 | 40,217 | 41,007 | 43,869 | 46,086 | 53,115 | 91,399 | 96,000 | ||||||||||||||||
Total restructured loans - accruing | 3,575 | 2,077 | 2,119 | 2,161 | 2,167 | 2,199 | 2,228 | 2,271 | ||||||||||||||||
Total non-performing loans | 39,359 | 44,461 | 43,479 | 46,326 | 48,810 | 78,167 | 94,307 | 98,700 | ||||||||||||||||
Other assets and other real estate owned (OREO) | 645 | 739 | 739 | 1,034 | 1,034 | 1,105 | 1,234 | 1,354 | ||||||||||||||||
Total non-performing assets | $ | 40,004 | $ | 45,200 | $ | 44,218 | $ | 47,360 | $ | 49,844 | $ | 79,272 | $ | 95,541 | $ | 100,054 |
For the Quarter Ended, | ||||||||||||||||||||||||||||||||
(Dollars in thousands) | 2022 | 2022 | 2022 | 2022 | 2021 | 2021 | 2021 | 2021 | ||||||||||||||||||||||||
Analysis of non-accrual loan activity: | ||||||||||||||||||||||||||||||||
Balance at beginning of period | $ | 40,217 | $ | 41,007 | $ | 43,869 | $ | 46,086 | $ | 53,115 | $ | 91,399 | $ | 96,000 | $ | 112,361 | ||||||||||||||||
Non-accrual balances transferred to OREO | — | — | — | — | — | — | (257 | ) | — | |||||||||||||||||||||||
Non-accrual balances charged-off | (22 | ) | (197 | ) | (376 | ) | (265 | ) | (754 | ) | (7,171 | ) | (2,166 | ) | (699 | ) | ||||||||||||||||
Net payments or draws | (9,535 | ) | (3,509 | ) | (3,234 | ) | (2,787 | ) | (5,786 | ) | (36,526 | ) | (3,693 | ) | (16,028 | ) | ||||||||||||||||
Loans placed on non-accrual | 5,467 | 4,212 | 948 | 1,503 | 511 | 5,699 | 1,515 | 421 | ||||||||||||||||||||||||
Non-accrual loans brought current | (1,345 | ) | (1,296 | ) | (200 | ) | (668 | ) | (1,000 | ) | (286 | ) | — | (55 | ) | |||||||||||||||||
Balance at end of period | $ | 34,782 | $ | 40,217 | $ | 41,007 | $ | 43,869 | $ | 46,086 | $ | 53,115 | $ | 91,399 | $ | 96,000 | ||||||||||||||||
Analysis of allowance for credit losses - loans: | ||||||||||||||||||||||||||||||||
Balance at beginning of period | $ | 128,268 | $ | 113,670 | $ | 110,588 | $ | 109,145 | $ | 107,920 | $ | 123,961 | $ | 130,361 | $ | 165,367 | ||||||||||||||||
Provision/ (credit) for credit losses - loans | 7,907 | 14,092 | 3,046 | 1,635 | 1,585 | (8,229 | ) | (4,204 | ) | (34,708 | ) | |||||||||||||||||||||
Less loans charged-off, net of recoveries: | ||||||||||||||||||||||||||||||||
Commercial real estate: | ||||||||||||||||||||||||||||||||
Commercial investor real estate | (1 | ) | — | (300 | ) | (19 | ) | (109 | ) | 5,797 | (144 | ) | (27 | ) | ||||||||||||||||||
Commercial owner-occupied real estate | (27 | ) | (10 | ) | (12 | ) | — | — | 136 | — | — | |||||||||||||||||||||
Commercial AD&C | — | — | — | — | — | 2,007 | — | — | ||||||||||||||||||||||||
Commercial business | (13 | ) | (512 | ) | 331 | 111 | 564 | (53 | ) | 2,359 | 634 | |||||||||||||||||||||
Residential real estate: | ||||||||||||||||||||||||||||||||
Residential mortgage | (50 | ) | (8 | ) | (9 | ) | 120 | (80 | ) | (49 | ) | (11 | ) | (270 | ) | |||||||||||||||||
Residential construction | — | (3 | ) | (5 | ) | — | (2 | ) | (2 | ) | (1 | ) | — | |||||||||||||||||||
Consumer | 24 | 27 | (41 | ) | (20 | ) | (13 | ) | (24 | ) | (7 | ) | (39 | ) | ||||||||||||||||||
Net charge-offs/ (recoveries) | (67 | ) | (506 | ) | (36 | ) | 192 | 360 | 7,812 | 2,196 | 298 | |||||||||||||||||||||
Balance at the end of period | $ | 136,242 | $ | 128,268 | $ | 113,670 | $ | 110,588 | $ | 109,145 | $ | 107,920 | $ | 123,961 | $ | 130,361 | ||||||||||||||||
Asset quality ratios: | ||||||||||||||||||||||||||||||||
Non-performing loans to total loans | 0.35 | % | 0.40 | % | 0.40 | % | 0.46 | % | 0.49 | % | 0.80 | % | 0.93 | % | 0.94 | % | ||||||||||||||||
Non-performing assets to total assets | 0.29 | % | 0.33 | % | 0.33 | % | 0.37 | % | 0.40 | % | 0.61 | % | 0.74 | % | 0.78 | % | ||||||||||||||||
Allowance for credit losses to loans | 1.20 | % | 1.14 | % | 1.05 | % | 1.09 | % | 1.10 | % | 1.11 | % | 1.23 | % | 1.25 | % | ||||||||||||||||
Allowance for credit losses to non-performing loans | 346.15 | % | 288.50 | % | 261.44 | % | 238.72 | % | 223.61 | % | 138.06 | % | 131.44 | % | 132.08 | % | ||||||||||||||||
Annualized net charge-offs/ (recoveries) to average loans | — | % | (0.02)% | — | % | 0.01 | % | 0.01 | % | 0.31 | % | 0.09 | % | 0.01 | % |
CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES - UNAUDITED
Three Months Ended | ||||||||||||||||||||
2022 | 2021 | |||||||||||||||||||
(Dollars in thousands and tax-equivalent) | Average Balances | Interest (1) | Annualized Average Yield/Rate | Average Balances | Interest (1) | Annualized Average Yield/Rate | ||||||||||||||
Assets | ||||||||||||||||||||
Commercial investor real estate loans | $ | 5,082,697 | $ | 56,353 | 4.40 | % | $ | 3,769,529 | $ | 38,452 | 4.05 | % | ||||||||
Commercial owner-occupied real estate loans | 1,753,351 | 20,433 | 4.62 | 1,669,737 | 19,239 | 4.57 | ||||||||||||||
Commercial AD&C loans | 1,136,780 | 18,868 | 6.59 | 1,140,059 | 11,543 | 4.02 | ||||||||||||||
Commercial business loans | 1,373,565 | 20,395 | 5.89 | 1,482,901 | 21,500 | 5.75 | ||||||||||||||
Total commercial loans | 9,346,393 | 116,049 | 4.93 | 8,062,226 | 90,734 | 4.47 | ||||||||||||||
Residential mortgage loans | 1,251,829 | 10,919 | 3.49 | 925,093 | 7,829 | 3.39 | ||||||||||||||
Residential construction loans | 231,318 | 1,851 | 3.17 | 186,129 | 1,521 | 3.24 | ||||||||||||||
Consumer loans | 426,134 | 6,775 | 6.31 | 436,030 | 3,928 | 3.57 | ||||||||||||||
Total residential and consumer loans | 1,909,281 | 19,545 | 4.08 | 1,547,252 | 13,278 | 3.42 | ||||||||||||||
Total loans (2) | 11,255,674 | 135,594 | 4.78 | 9,609,478 | 104,012 | 4.30 | ||||||||||||||
Loans held for sale | 10,901 | 234 | 8.58 | 29,426 | 271 | 3.68 | ||||||||||||||
Taxable securities | 1,243,089 | 6,047 | 1.95 | 1,114,936 | 3,888 | 1.39 | ||||||||||||||
Tax-advantaged securities | 474,366 | 3,026 | 2.55 | 420,329 | 2,431 | 2.31 | ||||||||||||||
Total investment securities (3) | 1,717,455 | 9,073 | 2.11 | 1,535,265 | 6,319 | 1.65 | ||||||||||||||
Interest-bearing deposits with banks | 149,651 | 1,427 | 3.78 | 837,741 | 330 | 0.16 | ||||||||||||||
Federal funds sold | 553 | 4 | 2.97 | 666 | 1 | 0.15 | ||||||||||||||
Total interest-earning assets | 13,134,234 | 146,332 | 4.43 | 12,012,576 | 110,933 | 3.67 | ||||||||||||||
Less: allowance for credit losses - loans | (127,404 | ) | (106,873 | ) | ||||||||||||||||
Cash and due from banks | 94,840 | 78,370 | ||||||||||||||||||
Premises and equipment, net | 65,958 | 59,450 | ||||||||||||||||||
Other assets | 601,844 | 748,003 | ||||||||||||||||||
Total assets | $ | 13,769,472 | $ | 12,791,526 | ||||||||||||||||
Liabilities and Stockholders' Equity | ||||||||||||||||||||
Interest-bearing demand deposits | $ | 1,398,120 | $ | 1,664 | 0.47 | % | $ | 1,487,392 | $ | 211 | 0.06 | % | ||||||||
Regular savings deposits | 528,306 | 232 | 0.17 | 512,814 | 46 | 0.04 | ||||||||||||||
Money market savings deposits | 3,231,952 | 16,480 | 2.02 | 3,554,108 | 920 | 0.10 | ||||||||||||||
Time deposits | 2,034,190 | 9,900 | 1.93 | 1,375,779 | 1,643 | 0.47 | ||||||||||||||
Total interest-bearing deposits | 7,192,568 | 28,276 | 1.56 | 6,930,093 | 2,820 | 0.16 | ||||||||||||||
Federal funds purchased | 172,478 | 1,677 | 3.86 | 11 | — | 0.06 | ||||||||||||||
Repurchase agreements | 74,797 | 20 | 0.11 | 144,988 | 43 | 0.12 | ||||||||||||||
Advances from FHLB | 500,326 | 4,759 | 3.77 | — | — | — | ||||||||||||||
Subordinated debt | 370,109 | 3,925 | 4.24 | 172,664 | 1,940 | 4.49 | ||||||||||||||
Total borrowings | 1,117,710 | 10,381 | 3.68 | 317,663 | 1,983 | 2.48 | ||||||||||||||
Total interest-bearing liabilities | 8,310,278 | 38,657 | 1.85 | 7,247,756 | 4,803 | 0.26 | ||||||||||||||
Noninterest-bearing demand deposits | 3,833,275 | 3,879,572 | ||||||||||||||||||
Other liabilities | 165,665 | 146,405 | ||||||||||||||||||
Stockholders' equity | 1,460,254 | 1,517,793 | ||||||||||||||||||
Total liabilities and stockholders' equity | $ | 13,769,472 | $ | 12,791,526 | ||||||||||||||||
Tax-equivalent net interest income and spread | $ | 107,675 | 2.58 | % | $ | 106,130 | 3.41 | % | ||||||||||||
Less: tax-equivalent adjustment | 1,032 | 862 | ||||||||||||||||||
Net interest income | $ | 106,643 | $ | 105,268 | ||||||||||||||||
Interest income/earning assets | 4.43 | % | 3.67 | % | ||||||||||||||||
Interest expense/earning assets | 1.17 | 0.16 | ||||||||||||||||||
Net interest margin | 3.26 | % | 3.51 | % |
(1) | Tax-equivalent income has been adjusted using the combined marginal federal and state rate of 25.47% and 25.64% for 2022 and 2021, respectively. The annualized taxable-equivalent adjustments utilized in the above table to compute yields aggregated to |
(2) | Non-accrual loans are included in the average balances. |
(3) | Available-for-sale investments are presented at amortized cost. |
CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES - UNAUDITED
Year Ended | ||||||||||||||||||||
2022 | 2021 | |||||||||||||||||||
(Dollars in thousands and tax-equivalent) | Average Balances | Interest (1) | Annualized Average Yield/Rate | Average Balances | Interest (1) | Annualized Average Yield/Rate | ||||||||||||||
Assets | ||||||||||||||||||||
Commercial investor real estate loans | $ | 4,681,607 | $ | 194,598 | 4.16 | % | $ | 3,689,769 | $ | 152,977 | 4.15 | % | ||||||||
Commercial owner-occupied real estate loans | 1,730,293 | 78,559 | 4.54 | 1,661,015 | 76,463 | 4.60 | ||||||||||||||
Commercial AD&C loans | 1,112,936 | 56,689 | 5.09 | 1,110,420 | 44,460 | 4.00 | ||||||||||||||
Commercial business loans | 1,351,906 | 69,765 | 5.16 | 1,952,537 | 94,391 | 4.83 | ||||||||||||||
Total commercial loans | 8,876,742 | 399,611 | 4.50 | 8,413,741 | 368,291 | 4.38 | ||||||||||||||
Residential mortgage loans | 1,117,053 | 37,551 | 3.36 | 979,754 | 33,874 | 3.46 | ||||||||||||||
Residential construction loans | 221,341 | 6,963 | 3.15 | 178,171 | 6,127 | 3.44 | ||||||||||||||
Consumer loans | 423,746 | 19,887 | 4.69 | 463,200 | 16,689 | 3.60 | ||||||||||||||
Total residential and consumer loans | 1,762,140 | 64,401 | 3.65 | 1,621,125 | 56,690 | 3.50 | ||||||||||||||
Total loans (2) | 10,638,882 | 464,012 | 4.36 | 10,034,866 | 424,981 | 4.24 | ||||||||||||||
Loans held for sale | 14,097 | 738 | 5.24 | 57,016 | 1,736 | 3.05 | ||||||||||||||
Taxable securities | 1,214,032 | 20,519 | 1.69 | 1,017,268 | 16,118 | 1.58 | ||||||||||||||
Tax-advantaged securities | 475,187 | 11,559 | 2.43 | 440,215 | 10,426 | 2.37 | ||||||||||||||
Total investment securities (3) | 1,689,219 | 32,078 | 1.90 | 1,457,483 | 26,544 | 1.82 | ||||||||||||||
Interest-bearing deposits with banks | 189,465 | 2,672 | 1.41 | 500,400 | 725 | 0.14 | ||||||||||||||
Federal funds sold | 574 | 8 | 1.41 | 570 | 1 | 0.12 | ||||||||||||||
Total interest-earning assets | 12,532,237 | 499,508 | 3.99 | 12,050,335 | 453,987 | 3.77 | ||||||||||||||
Less: allowance for credit losses - loans | (116,170 | ) | (130,437 | ) | ||||||||||||||||
Cash and due from banks | 84,992 | 95,620 | ||||||||||||||||||
Premises and equipment, net | 63,379 | 57,198 | ||||||||||||||||||
Other assets | 654,386 | 745,486 | ||||||||||||||||||
Total assets | $ | 13,218,824 | $ | 12,818,202 | ||||||||||||||||
Liabilities and Stockholders' Equity | ||||||||||||||||||||
Interest-bearing demand deposits | $ | 1,457,833 | $ | 3,177 | 0.22 | % | $ | 1,420,249 | $ | 911 | 0.06 | % | ||||||||
Regular savings deposits | 547,510 | 294 | 0.05 | 482,331 | 235 | 0.05 | ||||||||||||||
Money market savings deposits | 3,308,678 | 23,883 | 0.72 | 3,453,764 | 4,871 | 0.14 | ||||||||||||||
Time deposits | 1,573,868 | 16,500 | 1.05 | 1,579,230 | 9,005 | 0.57 | ||||||||||||||
Total interest-bearing deposits | 6,887,889 | 43,854 | 0.64 | 6,935,574 | 15,022 | 0.22 | ||||||||||||||
Federal funds purchased | 107,785 | 2,805 | 2.60 | 15,154 | 13 | 0.08 | ||||||||||||||
Repurchase agreements | 108,273 | 124 | 0.11 | 143,734 | 169 | 0.12 | ||||||||||||||
Advances from FHLB | 256,621 | 7,825 | 3.05 | 111,311 | 2,649 | 2.38 | ||||||||||||||
Subordinated debt | 328,939 | 14,055 | 4.27 | 208,199 | 7,913 | 3.80 | ||||||||||||||
Total borrowings | 801,618 | 24,809 | 3.09 | 478,398 | 10,744 | 2.25 | ||||||||||||||
Total interest-bearing liabilities | 7,689,507 | 68,663 | 0.89 | 7,413,972 | 25,766 | 0.35 | ||||||||||||||
Noninterest-bearing demand deposits | 3,897,842 | 3,728,249 | ||||||||||||||||||
Other liabilities | 151,277 | 157,374 | ||||||||||||||||||
Stockholders' equity | 1,480,198 | 1,518,607 | ||||||||||||||||||
Total liabilities and stockholders' equity | $ | 13,218,824 | $ | 12,818,202 | ||||||||||||||||
Tax-equivalent net interest income and spread | $ | 430,845 | 3.10 | % | $ | 428,221 | 3.42 | % | ||||||||||||
Less: tax-equivalent adjustment | 3,841 | 3,703 | ||||||||||||||||||
Net interest income | $ | 427,004 | $ | 424,518 | ||||||||||||||||
Interest income/earning assets | 3.99 | % | 3.77 | % | ||||||||||||||||
Interest expense/earning assets | 0.55 | 0.21 | ||||||||||||||||||
Net interest margin | 3.44 | % | 3.56 | % |
(1) | Tax-equivalent income has been adjusted using the combined marginal federal and state rate of 25.47% and 25.64% for 2022 and 2021, respectively. The annualized taxable-equivalent adjustments utilized in the above table to compute yields aggregated to |
(2) | Non-accrual loans are included in the average balances. |
(3) | Available-for-sale investments are presented at amortized cost. |
![](https://ml.globenewswire.com/media/YTEwOTc1YmMtM2NmNy00NjJhLWE5ZWItMTc4NTNiNGY5MzkzLTEwMzIxNzM=/tiny/Sandy-Spring-Bancorp-Inc-.png)
2023 GlobeNewswire, Inc., source