Synovus Financial Corp. (NYSE: SNV) today reported financial results for the quarter ended December 31, 2011.

Fourth Quarter Results

  • Net income available to common shareholders was $12.8 million for the fourth quarter of 2011, compared to net income available to common shareholders of $15.7 million in the third quarter of 2011 and a net loss attributable to common shareholders of $180.0 million in the fourth quarter of 2010.
  • Diluted net income per common share for the fourth quarter of 2011 was $0.014 compared to diluted net income per common share of $0.017 for the third quarter of 2011, and a net loss per common share of $0.229 for the fourth quarter of 2010.
  • The fourth quarter of 2011 results include net investment securities gains of $10.3 million (compared to $62.9 million for the third quarter of 2011) as well as a $5.9 million charge related to Synovus' indemnification obligation as a member of the Visa USA network.

"We are pleased to report a profit for the second consecutive quarter," said Kessel D. Stelling, Chairman and CEO of Synovus. "Our performance during the quarter was driven primarily by the continued improving trends in credit metrics and the resulting reduction of credit costs. Additionally, we are encouraged that the positive momentum in the loan pipeline, along with reductions in charge-offs and loan sales, contributed to the stabilization of loan balances as compared to the over $400 million decline in the previous quarter. We continue to gain positive traction for long-term, sustained profitability and growth."

Credit Trends

  • Total credit costs declined for the tenth consecutive quarter to $90.5 million for the fourth quarter of 2011, down 36.5% from the third quarter of 2011 and down 67.9% from the fourth quarter of 2010.
  • Net charge-offs were $113.5 million in the quarter, down 18.0% from $138.3 million in the third quarter of 2011, and down 70.5% from $385.2 million in the fourth quarter of 2010. The annualized net charge-off ratio was 2.26% in the fourth quarter, down from 2.72% in the previous quarter, and down from 6.93% in the fourth quarter of 2010.
  • New non-performing loan inflows were $189.2 million in the fourth quarter of 2011, down 14.8% from $222.0 million in the third quarter of 2011 and down 35.8% from $294.9 million in the fourth quarter of 2010.
  • Potential problem commercial loans (consisting of substandard accruing loans but excluding loans 90 days past due and still accruing interest and substandard accruing troubled debt restructurings which are reported separately) declined for the fifth consecutive quarter to $779.6 million, a 17.2% decline from the third quarter of 2011, and a 58.3% decrease from the peak of $1.87 billion in the third quarter of 2010.
  • Total non-performing assets were $1.12 billion at December 31, 2011, down $47.0 million from the previous quarter, and down $162.9 million or 12.7% from the fourth quarter of 2010. The non-performing asset ratio was 5.50% at December 31, 2011, compared to 5.71% at the end of the previous quarter and 5.83% at December 31, 2010.
  • Total accruing troubled debt restructurings (TDRs) increased to $668.5 million in the fourth quarter of 2011 compared to $640.3 million in the previous quarter. At December 31, 2011, over 98% of accruing TDRs are current as to principal and interest.
  • Distressed asset sales were approximately $147 million during the fourth quarter, compared to approximately $169 million in the third quarter of 2011, and approximately $573 million in the fourth quarter of 2010.
  • Total delinquencies (consisting of loans 30 or more days past due and still accruing) were 0.74% of total loans at December 31, 2011, down from 0.99% at September 30, 2011, and 0.82% at December 31, 2010. Total loans past due 90 days or more and still accruing were 0.07% at December 31, 2011, down from 0.13% at September 30, 2011, and 0.08% at December 31, 2010.

Core Performance

Pre-tax, pre-credit costs income was $113.8 million for the fourth quarter of 2011, down $5.6 million from $119.4 million in the third quarter of 2011.

  • Net interest margin was 3.52%, up five basis points from the third quarter of 2011 and up fifteen basis points from the fourth quarter of 2010.
  • The effective cost of funds was down ten basis points, while the yield on earning assets was down five basis points.
  • Non-interest income, excluding net investment securities gains of $10.3 million, was down $7.4 million or 10.5% from the previous quarter.
    • Bankcard fees declined $4.4 million from the prior quarter, primarily due to the impact of the Durbin Amendment, which became effective October 1, 2011.
    • Mortgage revenues were down $2.6 million from the prior quarter.
  • Total reported non-interest expense was $219.1 million for the fourth quarter of 2011 compared to $222.6 million for the previous quarter.
    • Core expenses (excludes Visa indemnification charge, restructuring charges and credit costs) were down $3.2 million from the third quarter of 2011.
    • Core expenses for 2011 were down $95.3 million or 11.7% from 2010, due primarily to the efficiency initiatives that were announced and implemented in 2011.
    • Total headcount is 5,224 at December 31, 2011, down 885 or 14.5% from December 31, 2010.

Balance Sheet Fundamentals

  • Net sequential quarter loan growth, excluding the impact of loan sales, transfers to loans held-for-sale, charge-offs, and foreclosures was approximately $167 million for the fourth quarter, compared to a decline of approximately $132 million during the third quarter of 2011.
  • On a sequential quarter basis, total loans declined $22.3 million, compared to $402.7 million decrease in the previous quarter.
  • Total deposits ended the quarter at $22.4 billion, down $697.7 million from the previous quarter due primarily to the planned reductions in national market brokered deposits and time deposits.
    • Total core deposits ended the quarter at $20.6 billion, down $323.2 million compared to the third quarter of 2011, driven by a $361.0 million decline in time deposits.
    • Non-interest bearing demand deposits were up $117.5 million or 8.9% (annualized) from the third quarter of 2011, and up $1.07 billion or 24.9% from the fourth quarter of 2010.
    • The number of non-interest bearing demand deposit accounts increased by 1,458 accounts, or 1.7% (annualized), over the third quarter of 2011.
    • Non-interest bearing deposits represent 26% of total core deposits at December 31, 2011, up from 20% at December 31, 2010.
    • The effective cost of core deposits (includes non-interest bearing deposits) continued to decline, with an effective cost of 53 basis points for the fourth quarter of 2011, compared to 62 basis points for the previous quarter and 82 basis points in the fourth quarter of 2010.

Regulatory Capital Ratios

  • Tier 1 Common Equity ratio was 8.49% at December 31, 2011 compared to 8.50% at September 30, 2011.
  • Tier 1 Capital ratio was 12.94% at December 31, 2011 compared to 12.97% at September 30, 2011.
  • Tier 1 Leverage ratio was 10.08% at December 31, 2011 up from 9.87% at September 30, 2011.
  • Total Risk-based Capital ratio was 16.50% at December 31, 2011 compared to 16.53% at September 30, 2011.

Stelling concluded, "2011 clearly reflected a turning point for Synovus as we returned to profitability in the second half of the year. Key achievements included positive trends in credit, restructuring of the expense base, redesigning processes to improve the customer experience, key talent additions, and stabilization of loan balances. We have made much progress as our dedicated team has taken on the challenges and opportunities of 2011, and we look forward to continuing that momentum into 2012 and beyond."

Synovus will host an earnings highlights conference call at 8:30 a.m. EST on January 24, 2012. The earnings call will be accompanied by a slide presentation. Shareholders and other interested parties can access the slide presentation and listen to the conference call via simultaneous Internet broadcast at www.synovus.com by clicking on the "Live Webcast" icon. RealPlayer or Windows Media Player can be downloaded prior to accessing the actual call or the replay. The replay will be archived for 12 months and will be available 30-45 minutes after the call.

About Synovus

Synovus Financial Corp. is a financial services company with over $27 billion in assets based in Columbus, Georgia. Synovus Financial Corp. provides commercial and retail banking, investment and mortgage services to customers in Georgia, Alabama, South Carolina, Florida and Tennessee. See Synovus Financial Corp. on the web at www.synovus.com.

Forward-Looking Statements

This press release and certain of our other filings with the Securities and Exchange Commission contain statements that constitute "forward-looking statements" within the meaning of, and subject to the protections of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are forward-looking statements. You can identify these forward-looking statements through Synovus' use of words such as "believes," "anticipates," "expects," "may," "will," "assumes," "should," "predicts," "could," "would," "intends," "targets," "estimates," "projects," "plans," "potential" and other similar words and expressions of the future or otherwise regarding the outlook for Synovus' future business and financial performance and/or the performance of the commercial banking industry and economy in general. These forward-looking statements include, among others, our expectations on credit trends, deposits and our loan portfolio; expectations on growth; statements regarding our continued sustainable profitability in future periods; and the assumptions underlying our expectations. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve known and unknown risks and uncertainties which may cause the actual results, performance or achievements of Synovus to be materially different from the future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements are based on the information known to, and current beliefs and expectations of, Synovus' management and are subject to significant risks and uncertainties. Actual results may differ materially from those contemplated by such forward-looking statements. A number of factors could cause actual results to differ materially from those contemplated by the forward-looking statements in this report. Many of these factors are beyond Synovus' ability to control or predict.

These forward-looking statements are based upon information presently known to Synovus' management and are inherently subjective, uncertain and subject to change due to any number of risks and uncertainties, including, without limitation, the risks and other factors set forth in Synovus' filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K/A for the year ended December 31, 2010 under the captions "Cautionary Notice Regarding Forward-Looking Statements" and "Risk Factors" and in Synovus' quarterly reports on Form 10-Q and current reports on Form 8-K. We believe these forward-looking statements are reasonable; however, undue reliance should not be placed on any forward-looking statements, which are based on current expectations and speak only as of the date that they are made. We do not assume any obligation to update any forward-looking statements as a result of new information, future developments or otherwise, except as otherwise may be required by law.

Use of Non-GAAP Financial Measures

The measures entitled core deposits, tangible common equity to tangible assets ratio, pre-tax, pre-credit costs income, core expenses, non-interest income excluding net investment securities gains (losses), and net sequential quarter loan growth (decline) are not measures recognized under U.S. generally accepted accounting principles (GAAP), and therefore are considered non-GAAP financial measures. The most comparable GAAP measures are total deposits, total shareholders' equity to total assets ratio, income (loss) before income taxes, and total non-interest expense, total non-interest income, and sequential quarter total loan growth (decline), respectively.

Synovus believes that these non-GAAP financial measures provide meaningful additional information about Synovus to assist management and investors in evaluating Synovus' capital strength and the performance of its core business. These non-GAAP financial measures should not be considered as substitutes for total deposits, total shareholders' equity to total assets ratio, income (loss) before income taxes, or total non-interest expense, total non-interest income, or sequential quarter total loan growth (decline) determined in accordance with GAAP and may not be comparable to other similarly titled measures at other companies.

The computations of core deposits, tangible common equity to tangible assets ratio, pre-tax, pre-credit costs income, and core expenses, non-interest income excluding net investment gains (losses), and net sequential quarter loan growth (decline) and the reconciliation of these measures to total deposits, total shareholders' equity to total assets ratio, income (loss) before income taxes, and total non-interest expense, total non-interest income, and sequential quarter total loan growth (decline) are set forth in the tables below.

 

Reconciliation of Non-GAAP Financial Measures

(dollars in thousands)   4Q11   3Q11   2Q11   1Q11   4Q10
Core Deposits
Total deposits $ 22,411,752 23,109,427 22,875,017 23,205,879 24,500,304
Subtract: Brokered deposits   (1,783,174 ) (2,157,631 ) (2,690,598 ) (2,978,615 ) (3,152,349 )
Core deposits $ 20,628,578   20,951,796   20,184,419   20,227,264   21,347,955  
 
Tangible Common Equity To Tangible Assets Ratio
Total assets $ 27,162,845 28,253,924 28,313,910 28,678,203 30,093,148
Subtract: Goodwill (24,431 ) (24,431 ) (24,431 ) (24,431 ) (24,431 )
Subtract: Other intangible assets, net   (8,525 ) (9,482 ) (10,449 ) (11,424 ) (12,434 )
Tangible assets $ 27,129,889   28,220,011   28,279,030   28,642,348   30,056,283  
 
Total shareholders' equity $ 2,827,452 2,829,448 2,850,938 2,882,605 2,997,918
Subtract: Goodwill (24,431 ) (24,431 ) (24,431 ) (24,431 ) (24,431 )
Subtract: Other intangible assets, net (8,525 ) (9,482 ) (10,449 ) (11,424 ) (12,434 )
Subtract: Cumulative perpetual preferred stock   (947,017 ) (944,538 ) (942,096 ) (939,691 ) (937,323 )
Tangible common equity $ 1,847,479   1,850,997   1,873,962   1,907,059   2,023,730  
 
Total shareholders' equity to total assets ratio 10.41 % 10.01 10.07 10.05 9.96
Tangible common equity to tangible assets ratio 6.81 % 6.56 6.63 6.66 6.73
 
Pre-tax, Pre-credit Costs Income
Income (loss) before income taxes $ 26,979 37,118 (43,764 ) (79,864 ) (159,550 )
Add: Provision for losses on loans 54,565 102,325 120,159 141,746 252,401
Add: Other credit costs(1) 35,962 40,211 37,772 35,347 29,305
Add: Restructuring charges 639 2,587 3,106 24,333 2,118

Subtract/Add: Net investment securities (gains)
losses

(10,337 ) (62,873 ) (377 ) (1,420 ) 228
Add/Subtract: Loss (gain) on curtailment of post-

retirement benefit

-- -- -- 398 (7,092 )
Add: Visa indemnification charge   5,942   --   92   4   --  
Pre-tax, pre-credit costs income $ 113,750   119,368   116,988   120,544   117,410  
 
Core Expenses
Total non-interest expense $ 219,082 222,552 222,415 239,716 229,006
Subtract: Other credit costs(1) (35,962 ) (40,211 ) (37,772 ) (35,347 ) (29,305 )
Subtract: Restructuring charges (639 ) (2,587 ) (3,106 ) (24,333 ) (2,118 )

Subtract/Add: (Loss) gain on curtailment of
post-retirement benefit

--

--

--

(398

)

7,092

Subtract: Visa indemnification charge   (5,942 ) --   (92 ) (4 ) --  
Core expenses $ 176,539   179,754   181,445   179,634   204,675  
 
(1) Other credit costs consist primarily of losses on ORE, provision for losses on unfunded commitments, and charges related to other loans held for sale.
 
 

Reconciliation of Non-GAAP Financial Measures (continued)

(dollars in thousands)   4Q11   3Q11   2Q11   1Q11   4Q10
 

Non-interest income excluding investment securities gains (losses), net

Total non-interest income $ 73,470 133,392 67,849 64,164 79,890

Subtract/Add: Net investment securities (gains)
losses

  (10,337 ) (62,873 ) (377 ) (1,420 ) 228  

Non-interest income excluding investment
securities gains (losses), net

$ 63,133   70,519   67,472   62,744   80,118  
 
 
Net sequential quarter loan growth (decline)
 
Sequential quarter decline in total loans $ (22,273 ) (402,724 ) (492,612 ) (588,341 ) (995,273 )
Add: Transfers to other loans held for sale 3,457 16,004 11,275 73,442 179,566
Add: Foreclosures 36,331 57,859 60,426 70,170 84,000

Add: Charge-offs excluding transfers to other
loans held for sale and loan sales

78,443 87,660 126,821 98,000 160,306
Add: Loan sales   70,808   109,140   126,462   108,719   465,570  
Net sequential quarter loan growth (decline) $ 166,766   (132,061 ) (167,628 ) (238,010 ) (105,831 )
 
                     
 
   
         
Core Expenses
Twelve Months Ended December 31,
(dollars in thousands)20112010
Total non-interest expense $ 903,765 1,009,576
Subtract: Other credit costs(1) (149,292 ) (198,425 )
Subtract: Restructuring charges (30,665 ) (5,538 )
Subtract: (Loss) gain on curtailment of post-retirement benefit (398 ) 7,092
Subtract: Visa indemnification charge   (6,038 )

--

 
Core expenses $ 717,372   812,705  
 
         
 
       

Synovus

 
INCOME STATEMENT DATA Twelve Months Ended
(Unaudited)
(Dollars in thousands, except per share data) December 31,
             
 
2011 2010 Change
           
Interest income

 

$

1,141,756

 1,320,581 (13.5 ) %
Interest expense 217,602 334,248 (34.9 )
     
 
Net interest income 924,154 986,333 (6.3 )
Provision for losses on loans 418,795 1,131,274 (63.0 )
     
 
Net interest income (expense) after provision for losses on loans 505,359 (144,941 ) nm
     
 
Non-interest income:
Service charges on deposit accounts 78,770 105,114 (25.1 )
Fiduciary and asset management fees 45,809 44,142 3.8
Brokerage revenue 26,006 28,184 (7.7 )
Mortgage revenue 20,316 33,334 (39.1 )
Bankcard fees 41,493 41,420 0.2
Investment securities gains (losses), net 75,007 (1,271 ) nm
Other fee income 19,953 21,129 (5.6 )
(Decrease) increase in fair value of private equity investments, net (1,118 ) 7,203 nm
Other non-interest income 32,638 26,092 25.1
     
 
Total non-interest income 338,874 305,347 11.0
     
 
Non-interest expense:
Salaries and other personnel expense 371,148 418,629 (11.3 )
Net occupancy and equipment expense 114,037 122,046 (6.6 )
FDIC insurance and other regulatory fees 59,063 69,480 (15.0 )
Foreclosed real estate expense 133,570 163,630 (18.4 )
(Gains) losses on other loans held for sale, net (2,737 ) 3,050 nm
Professional fees 40,585 45,554 (10.9 )
Data processing expense 35,757 45,478 (21.4 )
Visa indemnification charge 6,038 - nm
Restructuring charges 30,665 5,538 nm
Loss (gain) on curtailment of post-retirement defined benefit plan 398 (7,092 ) nm
Other operating expenses 115,241 143,263 (19.6 )
     
 
 
Total non-interest expense 903,765 1,009,576 (10.5 )
     
 
Loss from continuing operations before income taxes (59,532 ) (849,170 ) 93.0
Income tax expense (benefit) 1,312 (15,151 ) nm
     
 
Loss from continuing operations (60,844 ) (834,019 ) 92.7
 
Income from discontinued operations, net of income taxes   -   43,162   nm
 
Net loss (60,844 ) (790,857 ) 92.3
 
Net loss attributable to non-controlling interest   (220 ) (179 ) (22.9 )
 
Net loss attributable to controlling interest   (60,624 ) (790,678 ) 92.3  
 
Dividends and accretion of discount on preferred stock   58,088   57,510   1.0  
 
 
Net loss attributable to common shareholders

 

$

(118,712

) (848,188 ) 86.0  
 
 
Basic EPS
Net loss from continuing operations attributable to common shareholders

 

$

(0.151

) (1.301 ) 88.4 %
Net loss attributable to common shareholders (0.151 ) (1.238 ) 87.8
 
Diluted EPS
Net loss from continuing operations attributable to common shareholders (0.151 ) (1.301 ) 88.4
Net loss attributable to common shareholders (0.151 ) (1.238 ) 87.8
 
Cash dividends declared per common share 0.04 0.04 -
 
Return on average assets (0.21 ) % (2.61 ) 240 bp
Return on average common equity (6.04 ) (40.49 ) nm
 
 
Average common shares outstanding - basic 785,272 685,186 14.6 %
Average common shares outstanding - diluted 785,272 685,186 14.6
 
nm - not meaningful
 
             
Synovus
 
INCOME STATEMENT DATA
(Unaudited)
(Dollars in thousands, except per share data)

 

 

 

2011

  

2010

 

4th Quarter

 
Fourth
Quarter		 Third
Quarter 		Second
Quarter 		First
Quarter 		Fourth
Quarter

'11 vs. '10
Change

 
Interest income

 

$

273,303

 281,970 288,052 298,432 313,557 (12.8 ) %
Interest expense   46,147   53,367   57,091   60,998   71,590   (35.5 )
 
 
Net interest income 227,156 228,603 230,961 237,434 241,967 (6.1 )
Provision for losses on loans   54,565   102,325   120,159   141,746   252,401   (78.4 )
 
 
Net interest income (expense) after provision for losses on loans   172,591   126,278   110,802   95,688   (10,434 ) nm  
 
 
Non-interest income:
Service charges on deposit accounts 19,175 20,039 19,238 20,318 24,248 (20.9 )
Fiduciary and asset management fees 10,763 11,631 11,879 11,537 11,039 (2.5 )
Brokerage revenue 6,939 6,556 6,291 6,220 8,750 (20.7 )
Mortgage revenue 4,847 7,427 5,547 2,495 11,039 (56.1 )
Bankcard fees 7,150 11,562 12,125 10,657 11,431 (37.5 )
Investment securities gains (losses), net 10,337 62,873 377 1,420 (228 ) nm
Other fee income 4,310 5,423 5,289 4,931 4,757 (9.4 )
(Decrease) increase in fair value of private equity investments, net (177 ) (771 ) (301 ) 132 1,500 nm
Other non-interest income   10,126   8,652   7,404   6,454   7,354   37.7  
 
 
Total non-interest income   73,470   133,392   67,849   64,164   79,890   (8.0 )
 
 
 
Non-interest expense:
Salaries and other personnel expense 93,115 93,184 91,749 93,100 104,744 (11.1 )
Net occupancy and equipment expense 27,338 27,981 28,883 29,834 30,169 (9.4 )
FDIC insurance and other regulatory fees 13,238 15,463 15,956 14,406 16,686 (20.7 )
Foreclosed real estate expense 31,853 37,108 39,872 24,737 20,793 53.2
(Gains) losses on other loans held for sale, net (145 ) (846 ) 480 (2,226 ) 2,976 nm
Professional fees 10,321 10,135 10,893 9,236 12,154 (15.1 )
Data processing expense 8,532 9,024 9,251 8,950 12,355 (30.9 )
Visa indemnification charge 5,942 - 92 4 - nm
Restructuring charges 639 2,587 3,106 24,333 2,118 (69.8 )
Loss (gain) on curtailment of post-retirement defined benefit plan - - - 398 (7,092 ) nm
Other operating expenses   28,249   27,916   22,133   36,944   34,103   (17.2 )
 
 
Total non-interest expense   219,082   222,552   222,415   239,716   229,006   (4.3 )
 
 
 
Income (loss) before income taxes 26,979 37,118 (43,764 ) (79,864 ) (159,550 ) nm
Income tax (benefit) expense   (378 ) 6,910   (4,764 ) (456 ) 5,884   nm  
 
 
Net income (loss) 27,357 30,208 (39,000 ) (79,408 ) (165,434 ) nm
Net (loss) income attributable to non-controlling interest   -   -   -   (220 ) 134   nm  
 
Net income (loss) available to controlling interest   27,357   30,208   (39,000 ) (79,188 ) (165,568 ) nm  
 
Dividends and accretion of discount on preferred stock   14,578   14,541   14,504   14,466   14,430   1.0  
 
 
 
Net income (loss) available to common shareholders

 

$

12,779

   15,667   (53,504 ) (93,654 ) (179,998 ) nm  
 
 
Basic EPS
Net income (loss) available to common shareholders 0.016 0.020 (0.068 ) (0.119 ) (0.229 ) nm
 
Diluted EPS
Net income (loss) available to common shareholders 0.014 0.017 (0.068 ) (0.119 ) (0.229 ) nm
 
Cash dividends declared per common share 0.01 0.01 0.01 0.01 0.01 -
 
Return on average assets * 0.39 % 0.42 (0.55 ) (1.09 ) (2.12 ) nm bp
Return on average common equity * 2.66 3.20 (10.95 ) (18.46 ) (31.80 ) nm
 
 
Average common shares outstanding - basic 785,289 785,280 785,277 785,243 785,122 nm %
Average common shares outstanding - diluted 911,253 911,247 785,277 785,243 785,122 16.1
 
nm - not meaningful
* - ratios are annualized
 
       
Synovus
       
BALANCE SHEET DATA

December 31, 2011

September 30, 2011

December 31, 2010
(Unaudited)
 
(In thousands, except share data)
 
ASSETS
Cash and due from banks $ 510,423 452,034 389,021
Interest bearing funds with Federal Reserve Bank 1,567,006 2,750,953 3,103,896
Interest earning deposits with banks 13,590 21,560 16,446
Federal funds sold and securities purchased
under resale agreements 158,916 189,304 160,502
Trading account assets, at fair value 16,866 17,467 22,294
Mortgage loans held for sale, at fair value 161,509 125,379 232,839
Other loans held for sale 30,156 53,074 127,365
Investment securities available for sale, at fair value 3,690,125 3,596,511 3,440,268
 
Loans, net of unearned income 20,079,813 20,102,086 21,585,763
Allowance for loan losses (536,494 ) (595,383 ) (703,547 )
Loans, net 19,543,319   19,506,703   20,882,216  
 
Premises and equipment, net 486,923 488,074 544,971
Goodwill 24,431 24,431 24,431
Other intangible assets, net 8,525 9,482 12,434
Other assets 951,056   1,018,952   1,136,465  
 
Total assets $ 27,162,845   28,253,924   30,093,148  
 
 
LIABILITIES AND EQUITY
Liabilities:
Deposits:
Non-interest bearing deposits $ 5,366,868 5,249,335 4,298,372
Interest bearing deposits, excluding brokered deposits 15,261,710 15,702,461 17,049,583
Brokered deposits 1,783,174   2,157,631   3,152,349  
 
 
Total deposits 22,411,752 23,109,427 24,500,304
 
 
Federal funds purchased and other short-term borrowings 313,757 328,806 499,226
Long-term debt 1,364,727 1,522,334 1,808,161
Other liabilities 245,157   463,909   260,910  
 
Total liabilities 24,335,393   25,424,476   27,068,601  
 
 
Equity:
Shareholders' equity:
Cumulative perpetual preferred stock, no par value (1) 947,017 944,538 937,323
Common stock, par value $1.00 (2) 790,989 790,974 790,956
Additional paid-in capital 2,241,171 2,254,068 2,293,264
Treasury stock, at cost (3) (114,176 ) (114,176 ) (114,176 )
Accumulated other comprehensive income 21,093 32,189 57,158
Accumulated deficit (1,058,642 ) (1,078,145 ) (966,607 )
Total shareholders' equity 2,827,452 2,829,448 2,997,918
Non-controlling interest in subsidiaries -   -   26,629  
Total equity 2,827,452   2,829,448   3,024,547  
 
Total liabilities and equity $ 27,162,845   28,253,924   30,093,148  
 
 
 
(1) Preferred shares outstanding: 967,870, at all periods presented

(2) Common shares outstanding: 785,295,428; 785,280,277; and 785,262,837 at December 31, 2011, September 30, 2011, and December 31, 2010, respectively.

(3) Treasury shares: 5,693,452, at all periods presented
 
  Synovus          
 
 
AVERAGE BALANCES AND YIELDS/RATES (1)
(Unaudited)
(Dollars in thousands)

 

 

 

2011

  

2010

Fourth Third Second First Fourth
  Quarter     Quarter   Quarter   Quarter   Quarter
Interest Earning Assets
Taxable investment securities (2) $ 3,647,459 3,152,589 3,172,818 3,264,581 3,104,004
Yield 2.59 % 3.28 3.46 3.56 3.76
Tax-exempt investment securities (2) (4) $ 25,566 27,903 31,264 44,228 51,400
Yield (taxable equivalent) 6.57 % 6.66 6.73 6.84 7.16
Trading account assets $ 19,107 14,601 16,881 20,281 16,037
Yield 4.87 % 5.76 5.27 5.13 5.86
Commercial loans (3) (4) $ 16,276,207 16,535,371 16,983,912 17,555,733 18,315,882
Yield 4.82 % 4.88 4.92 4.98 4.90
Consumer loans (3) $ 3,871,393 3,869,698 3,879,042 3,914,222 3,988,849
Yield 4.95 % 5.06 5.10 5.25 5.22
Allowance for loan losses $ (587,956 )     (632,082 )   (678,851 )   (698,609 )   (819,176 )
Loans, net (3) $ 19,559,644 19,772,987 20,184,103 20,771,346 21,485,555
Yield 5.01 % 5.09 5.14 5.21 5.16
Mortgage loans held for sale $ 161,632 91,257 79,340 152,981 260,759
Yield 4.58 % 5.74 6.16 4.74 4.60
Federal funds sold, due from Federal Reserve Bank,
and other short-term investments $ 2,221,728 3,075,470 2,929,515 3,033,284 3,628,939
Yield 0.24 % 0.24 0.25 0.25 0.25
Federal Home Loan Bank and Federal Reserve Bank stock (5) $ 84,171 96,442 104,727 111,096 113,341
Yield 0.93 % 0.90 0.87 0.90 0.59
                                   
Total interest earning assets $ 25,719,307 26,231,249 26,518,648 27,397,797 28,660,035
  Yield     4.23   %   4.28     4.37     4.42     4.36  
 
Interest Bearing Liabilities
 
Interest bearing demand deposits $ 3,457,677 3,302,439 3,379,243 3,526,730 3,864,106
Rate 0.26 % 0.30 0.32 0.33 0.33
Money market accounts $ 6,697,334 6,636,751 6,306,399 6,550,623 6,874,367
Rate 0.57 % 0.73 0.77 0.76 0.84
Savings deposits $ 516,520 521,604 520,518 493,504 484,460
Rate 0.12 % 0.13 0.14 0.14 0.14
Time deposits under $100,000 $ 2,062,171 2,131,453 2,124,525 2,212,215 2,383,411
Rate 1.17 % 1.27 1.38 1.53 1.74
Time deposits over $100,000 $ 2,710,893 2,912,476 2,978,929 3,291,202 3,859,235
Rate 1.40 % 1.49 1.57 1.65 1.77
Brokered money market accounts $ 236,973 325,002 390,048 393,981 423,428
Rate 0.27 % 0.39 0.47 0.51 0.54
Brokered time deposits $ 1,689,538 2,053,811 2,471,620 2,665,314 2,956,904
Rate 1.87   %   1.88     1.87     1.83     1.82  
Total interest bearing deposits $ 17,371,106 17,883,536 18,171,282 19,133,569 20,845,911
Rate 0.82 % 0.95 1.01 1.05 1.14
Federal funds purchased and other
short-term liabilities $ 329,343 368,311 449,815 412,008 442,183
Rate 0.26 % 0.28 0.26 0.29 0.33
Long-term debt $ 1,443,825 1,693,673 1,901,130 1,891,576 1,729,991
Rate 2.78 % 2.45 2.30 2.39 2.64
                                   
Total interest bearing liabilities $ 19,144,274 19,945,520 20,522,227 21,437,153 23,018,085
  Rate     0.96   %   1.06     1.11     1.15     1.23  
 
Non-interest bearing demand deposits $ 5,413,322 5,175,521 4,911,044 4,821,237 4,433,849
                           
Net interest margin     3.52   %   3.47     3.51     3.52     3.37  
 
Taxable equivalent adjustment $ 844 880 893 964 968
 
(1) Yields and rates are annualized.
(2) Excludes net unrealized gains and (losses).
(3) Average loans are shown net of unearned income. Non-performing loans are included.

(4) Reflects taxable-equivalent adjustments, using the statutory federal income tax rate of 35%, in adjusting interest on tax-exempt loans and investment securities to a taxable-equivalent basis.

(5) Included as a component of Other Assets on the balance sheet
 
         
Synovus
 
 
LOANS OUTSTANDING AND NON-PERFORMING LOANS COMPOSITION
(Unaudited)
(Dollars in thousands)
 
 

 

December 31, 2011

 
Loans as a % Total Non-performing Loans
of Total Loans Non-performing as a % of Total
Loan Type Total Loans   Outstanding       Loans       Nonperforming Loans
 
 
Multi-Family $ 785,672 3.9 % $ 7,866 0.9 %
Hotels 791,444 3.9 6,420 0.7
Office Buildings 775,671 3.9 9,092 1.0
Shopping Centers 979,288 4.9 18,648 2.1
Commercial Development 286,954 1.4 37,225 4.2
Warehouses 489,086 2.4 10,525 1.2
Other Investment Property 449,198 2.2 5,990 0.7
         
 
Total Investment Properties 4,557,313 22.6 95,766 10.8
         
 
1-4 Family Construction 199,088 1.0 25,535 2.9
1-4 Family Investment Mortgage 976,552 4.9 57,924 6.6
Residential Development 442,844 2.2 114,125 12.9
         
 
Total 1-4 Family Properties 1,618,484 8.1 197,584 22.4
         
 
Land Acquisition 1,094,821 5.5 234,151 26.5
         
 
Total Commercial Real Estate 7,270,618 36.2 527,501 59.7
         
 
Commercial , Financial, and Agricultural 5,088,420 25.3 174,328 19.7
Owner-Occupied Real Estate 3,852,854 19.2 93,272 10.6
         
 
Total Commercial & Industrial 8,941,274 44.5 267,600 30.3
 
Home Equity Lines 1,619,585 8.1 24,559 2.8
Consumer Mortgages 1,411,749 7.0 56,995 6.5
Credit Cards 273,098 1.3 - -
Other Retail Loans 575,475 2.9 6,366 0.7
         
 
Total Retail 3,879,907 19.3 87,920 10.0
 
Unearned Income (11,986 ) nm - nm
         
 
Total $ 20,079,813   100.0   % $ 883,021   100.0   %
 
 
LOANS OUTSTANDING BY TYPE COMPARISON
(Unaudited)
(Dollars in thousands)
                             
Total Loans 4Q11 vs. 3Q11 4Q11 vs. 4Q10
Loan Type

December 31, 2011

   September 30, 2011       % change (1)       December 31, 2010       % change
 
 
Multi-Family $ 785,672 752,638 17.4 % $ 867,328 (9.4 ) %
Hotels 791,444 789,477 1.0 865,974 (8.6 )
Office Buildings 775,671 791,441 (7.9 ) 842,657 (7.9 )
Shopping Centers 979,288 1,001,547 (8.8 ) 1,078,122 (9.2 )
Commercial Development 286,954 300,474 (17.9 ) 381,107 (24.7 )
Warehouses 489,086 497,918 (7.0 ) 528,297 (7.4 )
Other Investment Property 449,198 463,014 (11.8 ) 495,617 (9.4 )
           
 
Total Investment Properties 4,557,313 4,596,509 (3.4 ) 5,059,102 (9.9 )
           
 
1-4 Family Construction 199,088 221,900 (40.8 ) 332,047 (40.0 )
1-4 Family Investment Mortgage 976,552 1,020,396 (17.0 ) 1,127,566 (13.4 )
Residential Development 442,844 484,095 (33.8 ) 643,174 (31.1 )
           
 
Total 1-4 Family Properties 1,618,484   1,726,391   (24.8 ) 2,102,787   (23.0 )
 
Land Acquisition 1,094,821 1,119,947 (8.9 ) 1,218,691 (10.2 )
           
 
Total Commercial Real Estate 7,270,618 7,442,847 (9.2 ) 8,380,580 (13.2 )
           
 
Commercial , Financial, and Agricultural 5,088,420 4,900,931 15.2 5,267,861 (3.4 )
Owner-Occupied Real Estate 3,852,854 3,911,614 (6.0 ) 3,996,949 (3.6 )
           
 
Total Commercial & Industrial 8,941,274 8,812,545 5.8 9,264,810 (3.5 )
 
 
Home Equity Lines 1,619,585 1,612,798 1.7 1,648,039 (1.7 )
Consumer Mortgages 1,411,749 1,426,024 (4.0 ) 1,475,261 (4.3 )
Credit Cards 273,098 267,810 7.8 284,970 (4.2 )
Other Retail Loans 575,475 550,106 18.3 542,539 6.1
           
Total Retail 3,879,907 3,856,738 2.4 3,950,809 (1.8 )
 
Unearned Income (11,986 ) (10,044 ) 76.7 (10,436 ) 14.9
           
 
Total $ 20,079,813   20,102,086   (0.4 ) % $ 21,585,763   (7.0 ) %
 
(1) Percentage change is annualized.
 
Synovus            
 
CREDIT QUALITY DATA
(Unaudited)
(Dollars in thousands)

 

 

 

2011

    

2010

4th Quarter

Fourth Third Second First Fourth '11 vs. '10
Quarter     Quarter   Quarter   Quarter   Quarter Change
 
Non-performing Loans $ 883,021 872,074 885,236 895,726 891,622 (1.0 ) %
Other Loans Held for Sale (1) 30,156 53,074 89,139 110,436 127,365 (76.3 )
Other Real Estate 204,232 239,255 244,313 269,314 261,305 (21.8 )
Non-performing Assets 1,117,409 1,164,403 1,218,688 1,275,476 1,280,292 (12.7 )
 
Allowance for Loan Losses 536,494 595,383 631,401 678,426 703,547 (23.7 )
 
Net Charge-Offs - Quarter 113,454 138,344 167,184 166,867 385,203 (70.5 )
Net Charge-Offs - YTD 585,849 472,395 334,051 166,867 1,371,452 (57.3 )
Net Charge-Offs / Average Loans - Quarter (2) 2.26 % 2.72 3.22 3.12 6.93
Net Charge-Offs / Average Loans - YTD (2) 2.84 3.03 3.17 3.12 5.82
 
Non-performing Loans / Loans 4.40 4.34 4.32 4.27 4.13
Non-performing Assets / Loans, Other Loans Held for Sale & ORE 5.50 5.71 5.85 5.97 5.83
Allowance / Loans 2.67 2.96 3.08 3.23 3.26
 
Allowance / Non-performing Loans 60.76 68.27 71.33 75.74 78.91
Allowance / Non-performing Loans (3) 126.54 145.12 161.55 176.08 192.60
 
Past Due Loans over 90 days and Still Accruing $ 14,521 26,860 23,235 10,490 16,222 (10.5 ) %
As a Percentage of Loans Outstanding 0.07 % 0.13 0.11 0.05 0.08
 
Total Past Dues Loans and Still Accruing $ 149,441 199,561 199,804 201,754 176,756 (15.5 )
As a Percentage of Loans Outstanding 0.74 % 0.99 0.97 0.96 0.82
 
Accruing troubled debt restructurings (TDRs) $ 668,472 640,324 551,603 545,416 464,123 44.0
 
(1) Represent impaired loans that are intended to be sold. Held for sale loans are carried at the lower of cost or fair value, less costs to sell.
(2) Ratio is annualized.
(3) Excludes non-performing loans for which the expected loss has been charged off.
 
                                 
 
 
SELECTED CAPITAL INFORMATION (1)
(Unaudited)
(Dollars in thousands)    
December 31, 2011 December 31, 2010

 

 
Tier 1 Capital $ 2,780,774 2,909,912
Total Risk-Based Capital 3,544,036 3,742,599
Tier 1 Capital Ratio 12.94 % 12.79
Tier 1 Common Equity Ratio 8.49 8.63
Total Risk-Based Capital Ratio 16.50 16.45
Tier 1 Leverage Ratio 10.08 9.44
Common Equity as a Percentage of Total Assets (2) 6.92 6.85
Tangible Common Equity as a Percentage of Tangible Assets (3) 6.81 6.73
Tangible Common Equity as a Percentage of Risk Weighted Assets (3) 8.60 8.90
Book Value Per Common Share (4) (5) 2.06 2.29
Tangible Book Value Per Common Share (3) (5) 2.02 2.25
 
 
(1) Current quarter regulatory capital information is preliminary.
(2) Common equity consists of Total Shareholders' Equity less Cumulative Perpetual Perferred Stock.
(3) Excludes the carrying value of goodwill and other intangible assets from common equity and total assets.
(4) Book Value Per Common Share consists of Total Shareholders' Equity less Cumulative Perpetual Preferred Stock divided by total common shares outstanding.
(5) Equity and common shares exclude impact of unexercised tangible equity units (tMEDS).

Synovus Financial Corp.
Patrick A. Reynolds, 706-649-4973
Director of Investor Relations