Community Bank System, Inc. (NYSE:CBU) reported first quarter 2019 net
income of $41.9 million, or $0.80 per fully diluted share. This compares
to $40.1 million of net income, or $0.78 per share reported for the
first quarter of 2018. The $0.02 increase in earnings per share was
attributable to an increase in net interest income and decreases in the
provision for loan losses and income taxes, offset in part by a decrease
in bank noninterest revenues, higher operating expenses and an increase
in fully-diluted shares outstanding. Comparatively, the Company recorded
$0.78 in fully diluted earnings per share for the linked fourth quarter
of 2018. Operating earnings per share, which excludes acquisition
expenses and unrealized gain on equity securities, were $0.81 for the
first quarter of 2019, a $0.03 improvement over the first quarter 2018
operating earnings per share.
First Quarter 2019 Performance Highlights:
-
First quarter GAAP EPS of $0.80; up $0.02 over first quarter of 2018
-
First quarter Operating EPS of $0.81; up $0.03 over the first quarter
of 2018
-
Net interest margin of 3.80% increased 9 basis points over first
quarter of 2018
-
Deposit funding costs of 0.20%
-
Return on assets of 1.59%
-
Return on tangible equity of 17.61%
-
Noninterest revenues represent 39.1% of operating revenues
-
Announced the acquisition of Kinderhook Bank Corp.
“Our improved first quarter 2019 operating results were driven by a
combination of net interest income growth, increased financial services
revenue and a continuation of excellent credit quality metrics, “said
Mark E. Tryniski, President and Chief Executive Officer. “The strong
performance of our core banking business worked to offset a $0.05
reduction in earnings per share related to the Durbin debit interchange
price restrictions which became effective for the Company in the third
quarter of 2018. Net interest income was up $2.2 million over the first
quarter of 2018 and the net interest margin increased nine basis points
to 3.80%, reflecting an increase in total loans and the favorable effect
of certain loan pre-payment fees, which added four basis points to the
net interest margin. Total deposits increased $297.3 million, or 3.6%,
in the quarter primarily from significant increases to transaction and
savings accounts. In January, we announced a definitive agreement to
acquire Kinderhook Bank Corp., parent company of National Union Bank of
Kinderhook. This transaction will extend our banking footprint into the
attractive Capital District markets which are similar to the other
Upstate New York markets in which we are a strong competitor. This
investment also complements the financial commitment we made in 2018
when we added an experienced commercial banking team focused on the
greater Albany area. We’re pleased with a first quarter performance
that’s reflective of consistent and effective execution of our ongoing
business strategy.”
Total revenues for the first quarter of 2019 were $142.6 million, an
increase of $0.4 million, or 0.3%, over the prior year quarter. Net
interest income increased $2.2 million, or 2.6%, to $86.9 million due to
an improvement in the net interest margin, while noninterest revenues
decreased $1.8 million, or 3.1%, between comparable quarters. A $3.0
million decrease in banking noninterest revenues, due primarily to the
impact of Durbin-related debit interchange price restrictions, and a
$0.3 million decrease in wealth management services revenues was offset,
in part, by a $1.0 million, or 4.6% increase in employee benefit
services revenues and a $0.5 million, or 6.8%, increase in the insurance
services revenues. Noninterest revenues of $55.7 million comprised 39.1%
of the Company’s total revenues during the first quarter of 2019,
similar to 2018 full year results.
Interest income and fees on loans increased $4.3 million versus the
comparable prior year quarter due to both an increase in average total
loans outstanding and an increase in the yield on all categories of
loans, reflective of higher market rates. The results for the quarter
were favorably impacted by $1.0 million in one-time loan fees.
Comparatively, the first quarter of 2018 was favorably impacted by $0.7
million in impaired loan accretion. A $0.4 million increase in interest
income on cash equivalents between comparable annual quarters was
partially offset by a $0.3 million decrease in interest income on the
investment securities portfolio due primarily to a $65.4 million
decrease in average outstanding balances on the Company’s non-taxable
municipal investment securities portfolio. The average yield on cash
equivalents increased from 1.54% in the first quarter of 2018 to 2.33%
in the first quarter of 2019, reflective of increases in short-term
market interest rates, and the average balance of cash equivalents
increased $30.9 million. Interest expense was $2.0 million higher than
the previous year’s first quarter, driven by an increase in the average
cost of deposit liabilities. The average cost of deposits was 0.20% in
the first quarter of 2019, as compared to 0.10% in the first quarter of
2018, reflective of market driven rate increases for deposits between
the periods. By comparison, the average cost of deposits during the
linked fourth quarter of 2018 was 0.16%.
The quarterly provision for loan losses of $2.4 million was $1.3
million lower than the first quarter of 2018 reflective of moderate
improvements in the Company’s credit quality metrics. Non-performing
loans decreased to 0.39% of total loans outstanding, as compared to
0.48% of total loans outstanding at the end of the first quarter of 2018
and 0.40% at the end of the linked fourth quarter. Similarly, delinquent
loans to total loans outstanding decreased to 0.88% at the end of the
first quarter of 2019. This compares to 1.01% at the end of the first
quarter of 2018 and 1.00% at the end of the linked fourth quarter.
Net-charge offs decreased $0.6 million from the first quarter of 2018,
due largely to a decrease in net charge-offs in the business lending and
consumer indirect loan portfolios.
Employee benefit services revenues for the first quarter of 2019 were
$24.1 million. This represents a $1.0 million, or 4.6%, increase over
first quarter 2018 revenues. The improvement in revenues was driven by
growth in the Company’s collective investment fund administration and
trust business, as well as growth in actuarial services revenues. The
Company recorded $7.9 million in insurance services revenues during the
first quarter of 2019, a $0.5 million, or 6.8%, increase over first
quarter 2018 results, reflective of solid new business generation.
Wealth management revenues for the first quarter of 2019 were $6.3
million. This compares to wealth management revenues of $6.7 million in
the first quarter of 2018. Banking noninterest revenues decreased $3.0
million due to a net $3.1 million decrease in debit interchange fees and
a $0.3 million decrease in other banking fees, including mortgage
banking and deposit service fees, offset in part by a $0.4 million gain
on life insurance.
Total operating expenses for the first quarter of 2019 were $88.7
million, representing a $2.3 million, or 2.7%, increase from the first
quarter of 2018 due to an increase in salaries and employee benefits,
data processing and communications, business development and marketing
expenses, and acquisition expenses. These increases were offset by
decreases in occupancy and equipment expense, amortization of intangible
assets, legal and professional fees, office supplies and postage, FDIC
insurance premiums and other expenses. Exclusive of $0.5 million of
acquisition expenses, total operating expenses increased $1.8 million,
or 2.1%, between the comparable quarterly periods.
The effective tax rate for the first quarter of 2019 was 18.5%, down
from 23.0% in the first quarter of 2018. The Company had significantly
higher levels of deductions related to stock based compensation activity
in the first quarter of 2019, as compared to the first quarter of 2018.
Exclusive of stock-based compensation tax benefits, the Company’s
effective tax rate was 21.8% in the first quarter of 2019.
The Company also provides supplemental reporting of its results on an
“operating,” “adjusted” or “tangible” basis, from which it excludes the
after-tax effect of amortization of core deposit and other intangible
assets (and the related goodwill, core deposit intangible and other
intangible asset balances, net of applicable deferred tax amounts),
accretion on non-impaired purchased loans, expenses associated with
acquisitions, the unrealized gain (loss) on equity securities and loss
on debt extinguishment. The amounts for such items are presented in the
tables that accompany this release. Although these items are non-GAAP
measures, the Company’s management believes this information helps
investors understand the effect of acquisition and other non-recurring
activity in its reported results. Diluted adjusted net earnings per
share were $0.85 in the first quarter of 2019, compared to $0.82 in the
first quarter of 2018, a 3.7% increase.
Financial Position
Average earning assets were up $67.0 million, or 0.7%, on a linked
quarter basis, from $9.31 billion during the fourth quarter of 2018 to
$9.37 billion during the first quarter of 2019. Average loan balances
during the first quarter of 2019 were $6.27 billion, down $2.4 million
from the fourth quarter of 2018. Average deposit balances were up $48.8
million, or 0.6%, from fourth quarter 2018 levels, due largely to an
increase in public fund deposits as seasonally anticipated. Ending
deposits were also up $297.3 million, or 3.6%, with growth in all
categories of deposits, interest-bearing and noninterest-bearing
checking, savings, money market and time deposits. Average borrowings,
including customer repurchase agreements, in the first quarter of 2019
of $373.7 million, were down $15.7 million, or 4.0%, from the fourth
quarter 2018 average of $389.4 million.
Ending loans at March 31, 2019 were $6.27 billion. This was down $15.0
million, or 0.2%, from the end of the fourth quarter of 2018, but up
$39.1 million, or 0.6%, when compared to March 31, 2018. During the
first quarter of 2019 and consistent with seasonal expectations,
outstanding balances in the consumer indirect, consumer direct and home
equity portfolios decreased $30.5 million. This was partially offset, by
a $13.5 million increase in the business lending portfolio and a $2.0
million increase in consumer mortgage balances.
Investment securities totaled $2.97 billion at March 31, 2019, down
$15.5 million, or 0.5%, from the end of the fourth quarter of 2018 and
down $66.5 million, or 2.2% from March 31, 2018. The net unrealized gain
in this portfolio was $7.9 million at March 31, 2019, as compared to a
$16.0 million unrealized loss at December 31, 2018, a $23.9 million
increase due to changes in market interest rates. These compare to a net
unrealized loss of $17.9 million at March 31, 2018. The effective
duration of the portfolio was 3.0 years at the end of the first quarter
of 2019.
Shareholders’ equity of $1.76 billion at March 31, 2019 was $43.3
million, or 2.5%, higher than the fourth quarter of 2018 and $125.7
million, or 7.7%, higher than March 31, 2018. The Company’s net tangible
equity to net tangible assets ratio was 9.83% at March 31, 2019, up from
8.42% a year earlier and 9.68% at the end of the fourth quarter of 2018.
The Company’s Tier 1 leverage ratio was 11.27% at the end of the first
quarter of 2019, up from 10.19% a year earlier. These results are
primarily a result of strong earnings generation and capital retention
over the last four quarters.
As previously announced in December 2018, the Company’s Board of
Directors approved a stock repurchase program authorizing the repurchase
of up to 2.5 million shares of the Company’s common stock during a
twelve-month period starting January 1, 2019. Such repurchases may be
made at the discretion of the Company’s senior management based on
market conditions and other relevant factors and will be acquired
through open market or privately negotiated transactions as permitted
under Rule 10b-18 of the Securities Exchange Act of 1934 and other
applicable legal requirements. There were no shares repurchased pursuant
to the program in 2019.
Asset Quality
The Company’s asset quality metrics continue to illustrate the long-term
effectiveness of the Company’s disciplined risk management and
underwriting standards. Total net charge-offs were $2.6 million for the
first quarter of 2019. This compares to $3.2 million in the first
quarter of 2018. The decrease in net charge-offs between the periods was
due primarily to decreases in net charge-offs in business lending and
the consumer indirect portfolios. Net charge-offs as an annualized
percentage of average loans measured 0.17% in the first quarter of 2019,
as compared to 0.21% in the first quarter of 2018. Nonperforming loans
as a percentage of total loans at the end of the first quarter of 2019
were 0.39%. This compares to 0.40% at the end of the linked fourth
quarter of 2018 and 0.48% at March 31, 2018, decreases of one basis
point and nine basis points, respectively. The total loan delinquency
ratio of 0.88% at the end of the first quarter of 2019 was 12 basis
points lower than the end of the fourth quarter of 2018 and 13 basis
points lower than the level one year earlier. The first quarter 2019
provision for loan losses of $2.4 million was $1.3 million lower than
the first quarter of 2018 and $0.1 million lower than the fourth quarter
of 2018. The allowance for loan losses to nonperforming loans was 202%
at March 31, 2019, compared with 197% at the end of the fourth quarter
of 2018 and 162% a year earlier. The Company’s allowance for loan losses
was $49.1 million, or 0.78%, of total loans outstanding at March 31,
2019, as compared to $48.1 million, or 0.77% of total loans outstanding
at the end of the first quarter of 2018.
Dividend Increase
During the first quarter of 2019, the Company declared a quarterly cash
dividend of $0.38 per share on its common stock, up 11.8% from the $0.34
dividend declared in the first quarter of 2018, representing an
annualized yield of 2.4% based upon the $62.38 closing price of the
Company’s stock on April 18, 2019. The four cent increase declared in
the third quarter of 2018 marked the 26th consecutive year of
dividend increases for the Company. “The improvement of our earnings and
cash flow results continue to provide further strength to capital
accumulation and dividend capacity,” said Mr. Tryniski.
Kinderhook Bank Corp.
On January 22, 2019, the Company announced that it entered into a
definitive agreement with Kinderhook Bank Corp., parent company of
National Union Bank of Kinderhook, pursuant to which the Company will
acquire Kinderhook Bank Corp. in an all cash transaction representing
total consideration valued at approximately $93.4 million (the
“Merger”). The Merger will extend the Company’s footprint into the
Capital District of Upstate New York. Upon completion, Community Bank,
N.A., the Company’s banking subsidiary, will add 11 branch locations
across a five county area with approximately $630 million in assets, and
deposits of $550 million. The Company has received the regulatory
approvals necessary to complete the Merger, including approval from the
Office of the Comptroller of the Currency and a waiver from filing an
application with the Federal Reserve Bank of New York. At the present
time, the Company expects the Merger to close early in the third quarter
of 2019, subject to customary closing conditions, including approval by
the shareholders of Kinderhook Bank Corp.
Conference Call Scheduled
Company management will conduct an investor call at 11:00 a.m. (ET)
today, April 22, 2019, to discuss first quarter 2019 results. The
conference call can be accessed at 866-337-5532 (786-460-7176 if outside
United States and Canada) using the conference ID code 8798966.
Investors may also listen live via the Internet at: https://www.webcaster4.com/Webcast/Page/995/29905.
This earnings release, including supporting financial tables, is
available within the press releases section of the Company's investor
relations website at: http://ir.communitybanksystem.com.
An archived webcast of the earnings call will be available on this site
for one full year.
About Us
Community Bank System, Inc. operates more than 230 customer facilities
across Upstate New York, Northeastern Pennsylvania, Vermont, and Western
Massachusetts through its banking subsidiary, Community Bank, N.A. With
assets of over $10.9 billion, the DeWitt, N.Y. headquartered company is
among the country’s 150 largest financial institutions. In addition to a
full range of retail, business, and municipal banking services, the
Company offers comprehensive financial planning, insurance and wealth
management services through its’ Community Bank Wealth Management Group
and OneGroup NY, Inc. operating units. The Company's Benefit Plans
Administrative Services, Inc. subsidiary is a leading provider of
employee benefits administration, trust services, collective investment
fund administration and actuarial consulting services to customers on a
national scale. Community Bank System, Inc. is listed on the New York
Stock Exchange and the Company's stock trades under the symbol CBU. For
more information about Community Bank visit www.communitybankna.com
or http://ir.communitybanksystem.com.
This press release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995. The
following factors, among others, could cause the actual results of CBU’s
operations to differ materially from CBU’s expectations: the successful
integration of operations of its acquisitions; competition; changes in
economic conditions, interest rates and financial markets; changes in
legislation or regulatory requirements; and the timing for receiving
regulatory approvals and completing pending transactions. These
statements are based on the current beliefs and expectations of CBU’s
management and CBU does not assume any duty to update forward-looking
statements.
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Summary of Financial Data
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(Dollars in thousands, except per share data)
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|
|
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|
|
|
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|
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2019
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2018
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|
|
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1st Qtr
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4th Qtr
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3rd Qtr
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2nd Qtr
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1st Qtr
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Earnings
|
|
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|
|
|
|
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|
|
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Loan income
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$73,703
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$73,316
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|
$72,256
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|
$71,152
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|
$69,441
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Investment income
|
|
|
18,978
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|
19,105
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|
18,647
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|
19,853
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|
18,963
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Total interest income
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|
|
92,681
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|
92,421
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|
90,903
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|
91,005
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|
88,404
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Interest expense
|
|
|
5,822
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|
5,034
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|
4,705
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|
4,159
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|
3,780
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|
Net interest income
|
|
|
86,859
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|
87,387
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|
86,198
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|
86,846
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|
84,624
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Provision for loan losses
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2,422
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|
2,495
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|
2,215
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|
2,448
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|
3,679
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Net interest income after provision for loan losses
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|
|
84,437
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|
84,892
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|
83,983
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|
84,398
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|
80,945
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Deposit service fees
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|
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15,864
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|
16,116
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|
16,127
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|
18,964
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|
19,177
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Revenues from mortgage banking and other banking services
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1,536
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|
1,026
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|
1,536
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|
1,163
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|
1,243
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Wealth management and insurance services
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14,211
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13,675
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14,438
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13,911
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|
14,065
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Employee benefit services
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24,054
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23,466
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23,265
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22,542
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23,006
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Unrealized gain(loss) on equity securities
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31
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(65)
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743
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(21)
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0
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Loss on debt extinguishment
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0
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0
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(318)
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0
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0
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Total noninterest revenues
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55,696
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54,218
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55,791
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56,559
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57,491
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Salaries and employee benefits
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53,379
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52,040
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51,062
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52,402
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51,859
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Occupancy and equipment
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10,288
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10,210
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9,770
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9,437
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10,531
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Amortization of intangible assets
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4,130
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4,375
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4,427
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4,555
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4,798
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Acquisition expenses
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534
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0
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(832)
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71
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(8)
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Other
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20,321
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20,988
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20,806
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19,647
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19,151
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Total operating expenses
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88,652
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87,613
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|
85,233
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|
86,112
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|
86,331
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Income before income taxes
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|
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51,481
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|
51,497
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|
54,541
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|
54,845
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|
52,105
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Income taxes
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|
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9,535
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10,674
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|
11,435
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|
10,239
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|
11,999
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Net income
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$41,946
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$40,823
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$43,106
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|
$44,606
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|
$40,106
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Basic earnings per share
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$0.81
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|
$0.79
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|
$0.84
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|
$0.87
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|
$0.78
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Diluted earnings per share
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|
$0.80
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|
$0.78
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|
$0.83
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|
$0.86
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|
$0.78
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Profitability
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Return on assets
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1.59%
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1.53%
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|
1.61%
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|
1.66%
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|
1.52%
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Return on equity
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|
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9.85%
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|
9.63%
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|
10.28%
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|
10.91%
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|
10.00%
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Return on tangible equity(2)
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17.61%
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17.61%
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|
19.06%
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|
20.58%
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19.11%
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Noninterest revenues/operating revenues (FTE) (1)
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39.1%
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38.5%
|
|
39.4%
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39.7%
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|
40.7%
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Efficiency ratio
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59.1%
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59.1%
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58.0%
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|
57.2%
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|
57.8%
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Components of Net Interest Margin (FTE)
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Loan yield
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4.78%
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4.65%
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|
4.57%
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|
4.58%
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4.53%
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Cash equivalents yield
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2.33%
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1.85%
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|
1.60%
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|
1.73%
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|
1.54%
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Investment yield
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2.59%
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2.62%
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|
2.55%
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|
2.65%
|
|
2.60%
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Earning asset yield
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|
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4.05%
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|
3.99%
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|
3.91%
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|
3.91%
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|
3.87%
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Interest-bearing deposit rate
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0.27%
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0.22%
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|
0.18%
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|
0.15%
|
|
0.14%
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Borrowing rate
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1.86%
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|
1.68%
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|
1.96%
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|
1.80%
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|
1.48%
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Cost of all interest-bearing funds
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0.36%
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0.31%
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0.29%
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0.25%
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|
0.23%
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Cost of funds (includes DDA)
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|
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0.27%
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|
0.23%
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|
0.21%
|
|
0.19%
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|
0.17%
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Net interest margin (FTE)
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|
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3.80%
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|
3.77%
|
|
3.71%
|
|
3.73%
|
|
3.71%
|
|
Fully tax-equivalent adjustment
|
|
|
$1,008
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|
$1,062
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|
$1,071
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|
$1,094
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|
$1,118
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|
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|
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|
|
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|
|
|
|
|
|
Summary of Financial Data
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
2019
|
|
2018
|
|
|
|
|
1st Qtr
|
|
4th Qtr
|
|
3rd Qtr
|
|
2nd Qtr
|
|
1st Qtr
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Average Balances
|
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|
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Loans
|
|
|
$6,273,798
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|
$6,276,231
|
|
$6,289,868
|
|
$6,250,739
|
|
$6,237,824
|
|
Cash equivalents
|
|
|
121,304
|
|
28,817
|
|
26,832
|
|
170,745
|
|
90,406
|
|
Taxable investment securities
|
|
|
2,574,902
|
|
2,577,366
|
|
2,574,116
|
|
2,575,962
|
|
2,583,446
|
|
Nontaxable investment securities
|
|
|
403,359
|
|
423,902
|
|
441,719
|
|
457,254
|
|
468,773
|
|
Total interest-earning assets
|
|
|
9,373,363
|
|
9,306,316
|
|
9,332,535
|
|
9,454,700
|
|
9,380,449
|
|
Total assets
|
|
|
10,687,708
|
|
10,575,272
|
|
10,619,872
|
|
10,752,203
|
|
10,715,529
|
|
Interest-bearing deposits
|
|
|
6,107,732
|
|
6,039,390
|
|
6,077,581
|
|
6,282,098
|
|
6,219,052
|
|
Borrowings
|
|
|
373,656
|
|
389,378
|
|
393,483
|
|
397,101
|
|
453,114
|
|
Total interest-bearing liabilities
|
|
|
6,481,388
|
|
6,428,768
|
|
6,471,064
|
|
6,679,199
|
|
6,672,166
|
|
Noninterest-bearing deposits
|
|
|
2,297,472
|
|
2,317,042
|
|
2,336,778
|
|
2,287,722
|
|
2,268,778
|
|
Shareholders' equity
|
|
|
1,726,313
|
|
1,682,525
|
|
1,664,234
|
|
1,640,076
|
|
1,625,951
|
|
Balance Sheet Data
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
$508,364
|
|
$211,834
|
|
$256,838
|
|
$250,154
|
|
$543,899
|
|
Investment securities
|
|
|
2,966,147
|
|
2,981,658
|
|
2,948,057
|
|
2,983,352
|
|
3,032,642
|
|
Loans:
|
|
|
|
|
|
|
|
|
|
|
|
|
Business lending
|
|
|
2,410,477
|
|
2,396,977
|
|
2,403,624
|
|
2,384,629
|
|
2,426,086
|
|
Consumer mortgage
|
|
|
2,237,430
|
|
2,235,408
|
|
2,220,022
|
|
2,210,051
|
|
2,211,882
|
|
Consumer indirect
|
|
|
1,070,840
|
|
1,083,207
|
|
1,098,943
|
|
1,063,679
|
|
1,008,198
|
|
Home equity
|
|
|
374,297
|
|
386,709
|
|
393,950
|
|
398,433
|
|
407,832
|
|
Consumer direct
|
|
|
173,042
|
|
178,820
|
|
184,349
|
|
181,217
|
|
173,032
|
|
Total loans
|
|
|
6,266,086
|
|
6,281,121
|
|
6,300,888
|
|
6,238,009
|
|
6,227,030
|
|
Allowance for loan losses
|
|
|
49,107
|
|
49,284
|
|
50,133
|
|
49,618
|
|
48,103
|
|
Intangible assets, net
|
|
|
804,419
|
|
807,349
|
|
811,700
|
|
816,127
|
|
820,584
|
|
Other assets
|
|
|
420,558
|
|
374,617
|
|
392,217
|
|
395,070
|
|
390,503
|
|
Total assets
|
|
|
10,916,467
|
|
10,607,295
|
|
10,659,567
|
|
10,633,094
|
|
10,966,555
|
|
Deposits:
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest-bearing
|
|
|
2,346,635
|
|
2,312,816
|
|
2,346,932
|
|
2,332,745
|
|
2,372,824
|
|
Non-maturity interest-bearing
|
|
|
5,517,141
|
|
5,270,015
|
|
5,366,488
|
|
5,439,101
|
|
5,642,109
|
|
Time
|
|
|
755,886
|
|
739,540
|
|
750,401
|
|
742,147
|
|
756,159
|
|
Total deposits
|
|
|
8,619,662
|
|
8,322,371
|
|
8,463,821
|
|
8,513,993
|
|
8,771,092
|
|
Borrowings
|
|
|
251,833
|
|
315,743
|
|
276,559
|
|
183,785
|
|
281,744
|
|
Subordinated debt held by unconsolidated subsidiary trusts
|
|
|
97,939
|
|
97,939
|
|
97,939
|
|
122,826
|
|
122,820
|
|
Accrued interest and other liabilities
|
|
|
189,905
|
|
157,459
|
|
152,903
|
|
155,531
|
|
159,433
|
|
Total liabilities
|
|
|
9,159,339
|
|
8,893,512
|
|
8,991,222
|
|
8,976,135
|
|
9,335,089
|
|
Shareholders' equity
|
|
|
1,757,128
|
|
1,713,783
|
|
1,668,345
|
|
1,656,959
|
|
1,631,466
|
|
Total liabilities and shareholders' equity
|
|
|
10,916,467
|
|
10,607,295
|
|
10,659,567
|
|
10,633,094
|
|
10,966,555
|
|
Capital
|
|
|
|
|
|
|
|
|
|
|
|
|
Tier 1 leverage ratio
|
|
|
11.27%
|
|
11.08%
|
|
10.72%
|
|
10.53%
|
|
10.19%
|
|
Tangible equity/net tangible assets (2)
|
|
|
9.83%
|
|
9.68%
|
|
9.13%
|
|
9.00%
|
|
8.42%
|
|
Diluted weighted average common shares O/S
|
|
|
52,195
|
|
52,122
|
|
52,086
|
|
51,939
|
|
51,677
|
|
Period end common shares outstanding
|
|
|
51,471
|
|
51,258
|
|
51,137
|
|
51,086
|
|
50,884
|
|
Cash dividends declared per common share
|
|
|
$0.38
|
|
$0.38
|
|
$0.38
|
|
$0.34
|
|
$0.34
|
|
Book value
|
|
|
$34.14
|
|
$33.43
|
|
$32.63
|
|
$32.43
|
|
$32.06
|
|
Tangible book value(2)
|
|
|
$19.40
|
|
$18.59
|
|
$17.67
|
|
$17.39
|
|
$16.88
|
|
Common stock price (end of period)
|
|
|
$59.77
|
|
$58.30
|
|
$61.07
|
|
$59.07
|
|
$53.56
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Summary of Financial Data
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2019
|
|
2018
|
|
|
|
|
1st Qtr
|
|
4th Qtr
|
|
3rd Qtr
|
|
2nd Qtr
|
|
1st Qtr
|
|
Asset Quality
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonaccrual loans
|
|
|
$21,252
|
|
$22,544
|
|
$21,982
|
|
$22,807
|
|
$23,239
|
|
Accruing loans 90+ days delinquent
|
|
|
3,019
|
|
2,455
|
|
2,951
|
|
6,532
|
|
6,425
|
|
Total nonperforming loans
|
|
|
24,271
|
|
24,999
|
|
24,933
|
|
29,339
|
|
29,664
|
|
Other real estate owned (OREO)
|
|
|
1,524
|
|
1,320
|
|
1,142
|
|
1,310
|
|
1,865
|
|
Total nonperforming assets
|
|
|
25,795
|
|
26,319
|
|
26,075
|
|
30,649
|
|
31,529
|
|
Net charge-offs
|
|
|
2,599
|
|
3,345
|
|
1,700
|
|
933
|
|
3,159
|
|
Allowance for loan losses/loans outstanding
|
|
|
0.78%
|
|
0.78%
|
|
0.80%
|
|
0.80%
|
|
0.77%
|
|
Nonperforming loans/loans outstanding
|
|
|
0.39%
|
|
0.40%
|
|
0.40%
|
|
0.47%
|
|
0.48%
|
|
Allowance for loan losses/nonperforming loans
|
|
|
202%
|
|
197%
|
|
201%
|
|
169%
|
|
162%
|
|
Net charge-offs/average loans
|
|
|
0.17%
|
|
0.21%
|
|
0.11%
|
|
0.06%
|
|
0.21%
|
|
Delinquent loans/ending loans
|
|
|
0.88%
|
|
1.00%
|
|
0.93%
|
|
0.89%
|
|
1.01%
|
|
Loan loss provision/net charge-offs
|
|
|
93%
|
|
75%
|
|
130%
|
|
262%
|
|
116%
|
|
Nonperforming assets/total assets
|
|
|
0.24%
|
|
0.25%
|
|
0.24%
|
|
0.29%
|
|
0.29%
|
|
Asset Quality (excluding loans acquired since 1/1/09)
|
|
|
|
|
|
|
|
|
|
|
|
|
Nonaccrual loans
|
|
|
$15,524
|
|
$16,182
|
|
$14,684
|
|
$14,644
|
|
$15,161
|
|
Accruing loans 90+ days delinquent
|
|
|
2,594
|
|
2,106
|
|
2,688
|
|
6,243
|
|
5,894
|
|
Total nonperforming loans
|
|
|
18,118
|
|
18,288
|
|
17,372
|
|
20,887
|
|
21,055
|
|
Other real estate owned (OREO)
|
|
|
898
|
|
669
|
|
859
|
|
1,025
|
|
1,336
|
|
Total nonperforming assets
|
|
|
19,016
|
|
18,957
|
|
18,231
|
|
21,912
|
|
22,391
|
|
Net charge-offs
|
|
|
1,516
|
|
3,053
|
|
1,533
|
|
552
|
|
1,800
|
|
Allowance for loan losses/loans outstanding
|
|
|
0.94%
|
|
0.93%
|
|
0.96%
|
|
0.98%
|
|
0.97%
|
|
Nonperforming loans/loans outstanding
|
|
|
0.36%
|
|
0.36%
|
|
0.35%
|
|
0.43%
|
|
0.45%
|
|
Allowance for loan losses/nonperforming loans
|
|
|
262%
|
|
256%
|
|
274%
|
|
225%
|
|
216%
|
|
Net charge-offs/average loans
|
|
|
0.12%
|
|
0.24%
|
|
0.12%
|
|
0.05%
|
|
0.16%
|
|
Delinquent loans/ending loans
|
|
|
0.89%
|
|
1.06%
|
|
0.97%
|
|
0.91%
|
|
1.01%
|
|
Loan loss provision/net charge-offs
|
|
|
142%
|
|
76%
|
|
138%
|
|
364%
|
|
122%
|
|
Nonperforming assets/total assets
|
|
|
0.20%
|
|
0.20%
|
|
0.20%
|
|
0.24%
|
|
0.24%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Summary of Financial Data
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2019
|
|
2018
|
|
|
|
|
1st Qtr
|
|
4th Qtr
|
|
3rd Qtr
|
|
2nd Qtr
|
|
1st Qtr
|
|
Quarterly GAAP to Non-GAAP Reconciliations
|
|
|
|
|
|
|
|
|
|
|
|
|
Income statement data
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (GAAP)
|
|
|
$41,946
|
|
$40,823
|
|
$43,106
|
|
$44,606
|
|
$40,106
|
|
Acquisition expenses
|
|
|
534
|
|
0
|
|
(832)
|
|
71
|
|
(8)
|
|
Tax effect of acquisition expenses
|
|
|
(99)
|
|
0
|
|
174
|
|
(13)
|
|
2
|
|
Subtotal (non-GAAP)
|
|
|
42,381
|
|
40,823
|
|
42,448
|
|
44,664
|
|
40,100
|
|
Unrealized (gain)loss on equity securities
|
|
|
(31)
|
|
65
|
|
(743)
|
|
21
|
|
0
|
|
Tax effect of unrealized (gain)loss on equity securities
|
|
|
6
|
|
(13)
|
|
156
|
|
(4)
|
|
0
|
|
Subtotal (non-GAAP)
|
|
|
42,356
|
|
40,875
|
|
41,861
|
|
44,681
|
|
40,100
|
|
Loss on debt extinguishment
|
|
|
0
|
|
0
|
|
318
|
|
0
|
|
0
|
|
Tax effect of loss on debt extinguishment
|
|
|
0
|
|
0
|
|
(67)
|
|
0
|
|
0
|
|
Operating net income (non-GAAP)
|
|
|
42,356
|
|
40,875
|
|
42,112
|
|
44,681
|
|
40,100
|
|
Amortization of intangibles
|
|
|
4,130
|
|
4,375
|
|
4,427
|
|
4,555
|
|
4,798
|
|
Tax effect of amortization of intangibles
|
|
|
(765)
|
|
(907)
|
|
(928)
|
|
(850)
|
|
(1,105)
|
|
Subtotal (non-GAAP)
|
|
|
45,721
|
|
44,343
|
|
45,611
|
|
48,386
|
|
43,793
|
|
Acquired non-impaired loan accretion
|
|
|
(1,330)
|
|
(1,838)
|
|
(1,980)
|
|
(2,040)
|
|
(2,063)
|
|
Tax effect of acquired non-impaired loan accretion
|
|
|
246
|
|
381
|
|
415
|
|
381
|
|
475
|
|
Adjusted net income (non-GAAP)
|
|
|
$44,637
|
|
$42,886
|
|
$44,046
|
|
$46,727
|
|
$42,205
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average assets
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income (non-GAAP)
|
|
|
$44,637
|
|
$42,886
|
|
$44,046
|
|
$46,727
|
|
$42,205
|
|
Average total assets
|
|
|
10,687,708
|
|
10,575,272
|
|
10,619,872
|
|
10,752,203
|
|
10,715,529
|
|
Adjusted return on average assets
|
|
|
1.69%
|
|
1.61%
|
|
1.65%
|
|
1.74%
|
|
1.60%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Return on average equity
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted net income (non-GAAP)
|
|
|
$44,637
|
|
$42,886
|
|
$44,046
|
|
$46,727
|
|
$42,205
|
|
Average total equity
|
|
|
1,726,313
|
|
1,682,525
|
|
1,664,234
|
|
1,640,076
|
|
1,625,951
|
|
Adjusted return on average equity
|
|
|
10.49%
|
|
10.11%
|
|
10.50%
|
|
11.43%
|
|
10.53%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per common share
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share (GAAP)
|
|
|
$0.80
|
|
$0.78
|
|
$0.83
|
|
$0.86
|
|
$0.78
|
|
Acquisition expenses
|
|
|
0.01
|
|
0.00
|
|
(0.02)
|
|
0.00
|
|
0.00
|
|
Tax effect of acquisition expenses
|
|
|
0.00
|
|
0.00
|
|
0.00
|
|
0.00
|
|
0.00
|
|
Subtotal (non-GAAP)
|
|
|
0.81
|
|
0.78
|
|
0.81
|
|
0.86
|
|
0.78
|
|
Unrealized (gain)loss on equity securities
|
|
|
0.00
|
|
0.00
|
|
(0.01)
|
|
0.00
|
|
0.00
|
|
Tax effect of unrealized (gain)loss on equity securities
|
|
|
0.00
|
|
0.00
|
|
0.00
|
|
0.00
|
|
0.00
|
|
Subtotal (non-GAAP)
|
|
|
0.81
|
|
0.78
|
|
0.80
|
|
0.86
|
|
0.78
|
|
Loss on debt extinguishment
|
|
|
0.00
|
|
0.00
|
|
0.01
|
|
0.00
|
|
0.00
|
|
Tax effect of loss on debt extinguishment
|
|
|
0.00
|
|
0.00
|
|
0.00
|
|
0.00
|
|
0.00
|
|
Operating diluted earnings per share (non-GAAP)
|
|
|
0.81
|
|
0.78
|
|
0.81
|
|
0.86
|
|
0.78
|
|
Amortization of intangibles
|
|
|
0.08
|
|
0.08
|
|
0.08
|
|
0.09
|
|
0.09
|
|
Tax effect of amortization of intangibles
|
|
|
(0.01)
|
|
(0.02)
|
|
(0.02)
|
|
(0.02)
|
|
(0.02)
|
|
Subtotal (non-GAAP)
|
|
|
0.88
|
|
0.84
|
|
0.87
|
|
0.93
|
|
0.85
|
|
Acquired non-impaired loan accretion
|
|
|
(0.03)
|
|
(0.04)
|
|
(0.04)
|
|
(0.04)
|
|
(0.04)
|
|
Tax effect of acquired non-impaired loan accretion
|
|
|
0.00
|
|
0.01
|
|
0.01
|
|
0.01
|
|
0.01
|
|
Diluted adjusted net earnings per share (non-GAAP)
|
|
|
$0.85
|
|
$0.81
|
|
$0.84
|
|
$0.90
|
|
$0.82
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Summary of Financial Data
|
|
|
|
|
|
|
|
|
|
|
|
|
(Dollars in thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2019
|
|
2018
|
|
|
|
|
1st Qtr
|
|
4th Qtr
|
|
3rd Qtr
|
|
2nd Qtr
|
|
1st Qtr
|
|
Quarterly GAAP to Non-GAAP Reconciliations
|
|
|
|
|
|
|
|
|
|
|
|
|
Income statement data (continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest operating expenses
|
|
|
|
|
|
|
|
|
|
|
|
|
Noninterest expenses (GAAP)
|
|
|
$88,652
|
|
$87,613
|
|
$85,233
|
|
$86,112
|
|
$86,331
|
|
Amortization of intangibles
|
|
|
(4,130)
|
|
(4,375)
|
|
(4,427)
|
|
(4,555)
|
|
(4,798)
|
|
Acquisition expenses
|
|
|
(534)
|
|
0
|
|
832
|
|
(71)
|
|
8
|
|
Total adjusted noninterest expenses (non-GAAP)
|
|
|
$83,988
|
|
$83,238
|
|
$81,638
|
|
$81,486
|
|
$81,541
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Efficiency ratio
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted noninterest expenses (non-GAAP) - numerator
|
|
|
$83,988
|
|
$83,238
|
|
$81,638
|
|
$81,486
|
|
$81,541
|
|
Tax-equivalent net interest income
|
|
|
87,867
|
|
88,449
|
|
87,269
|
|
87,940
|
|
85,742
|
|
Noninterest revenues
|
|
|
55,696
|
|
54,218
|
|
55,791
|
|
56,559
|
|
57,491
|
|
Acquired non-impaired loan accretion
|
|
|
(1,330)
|
|
(1,838)
|
|
(1,980)
|
|
(2,040)
|
|
(2,063)
|
|
Unrealized (gain)loss on equity securities
|
|
|
(31)
|
|
65
|
|
(743)
|
|
21
|
|
0
|
|
Loss on debt extinguishment
|
|
|
0
|
|
0
|
|
318
|
|
0
|
|
0
|
|
Operating revenues (non-GAAP) - denominator
|
|
|
142,202
|
|
140,894
|
|
140,655
|
|
142,480
|
|
141,170
|
|
Efficiency ratio (non-GAAP)
|
|
|
59.1%
|
|
59.1%
|
|
58.0%
|
|
57.2%
|
|
57.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance sheet data
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets (GAAP)
|
|
|
$10,916,467
|
|
$10,607,295
|
|
$10,659,567
|
|
$10,633,094
|
|
$10,966,555
|
|
Intangible assets
|
|
|
(804,419)
|
|
(807,349)
|
|
(811,700)
|
|
(816,127)
|
|
(820,584)
|
|
Deferred taxes on intangible assets
|
|
|
45,994
|
|
46,370
|
|
46,882
|
|
47,334
|
|
47,904
|
|
Total tangible assets (non-GAAP)
|
|
|
10,158,042
|
|
9,846,316
|
|
9,894,749
|
|
9,864,301
|
|
10,193,875
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total common equity
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders' Equity (GAAP)
|
|
|
1,757,128
|
|
1,713,783
|
|
1,668,345
|
|
1,656,959
|
|
1,631,466
|
|
Intangible assets
|
|
|
(804,419)
|
|
(807,349)
|
|
(811,700)
|
|
(816,127)
|
|
(820,584)
|
|
Deferred taxes on intangible assets
|
|
|
45,994
|
|
46,370
|
|
46,882
|
|
47,334
|
|
47,904
|
|
Total tangible common equity (non-GAAP)
|
|
|
998,703
|
|
952,804
|
|
903,527
|
|
888,166
|
|
858,786
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net tangible equity-to-assets ratio at quarter end
|
|
|
|
|
|
|
|
|
|
|
|
|
Total tangible common equity (non-GAAP) - numerator
|
|
|
$998,703
|
|
$952,804
|
|
$903,527
|
|
$888,166
|
|
$858,786
|
|
Total tangible assets (non-GAAP) - denominator
|
|
|
10,158,042
|
|
9,846,316
|
|
9,894,749
|
|
9,864,301
|
|
10,193,875
|
|
Net tangible equity-to-assets ratio at quarter end (non-GAAP)
|
|
|
9.83%
|
|
9.68%
|
|
9.13%
|
|
9.00%
|
|
8.42%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Excludes unrealized gains and losses on
equity securities and loss on debt extinguishment.
|
|
(2) Includes deferred tax liabilities related
to certain intangible assets.
|
|
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20190422005128/en/
Copyright Business Wire 2019