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Published: 2022-10-18 00:00:00 ET
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Exhibit 99.1

 

 

For Immediate Release

 

For more information:

 

Jefferson Harralson 

Chief Financial Officer 

(864) 240-6208 

Jefferson_Harralson@ucbi.com

 

United Community Banks, Inc. Reports Third Quarter Results 

Strong Core Profitability Driven by Loan Growth and Continued Margin Expansion

 

GREENVILLE, SC – October 18, 2022 - United Community Banks, Inc. (NASDAQ: UCBI) (United) announced today that net income for the third quarter was $81.2 million with pre-tax, pre-provision income of $118.9 million. Diluted earnings per share was $0.74 for the quarter, which represented an increase of $0.13 or 21% from the second quarter of 2022, and a decrease of $0.08 or 10% from the third quarter a year ago. The year-over-year decrease is largely attributable to an $11.0 million provision release in the third quarter of 2021 compared to a $15.4 million provision expense in this quarter. Other highlights of the quarter include 9.4% annualized loan growth, 38 basis points of net interest margin expansion, a reserve build to 1.12% of loans and an improvement in the efficiency ratio to 48.4%, or 47.7% on an operating basis, which excludes the effect of merger-related and other charges.

 

United’s third-quarter return on assets (ROA) was 1.32%, and return on common equity was 11.02%. On an operating basis, United’s ROA was 1.34%, and its return on tangible common equity was 15.60%. Also, on an operating basis, United’s pre-tax, pre-provision ROA was 1.97% for the quarter.

 

Total loans increased by $341 million during the quarter, resulting in loan growth of 9.4% on an annualized basis. Deposits decreased by $552 million or 11% annualized. A large portion of this decrease was driven by a seasonal decrease in public deposits, which were down by $278 million. United’s cost of deposits increased 11 basis points from the second quarter to 0.19% while the average yield on interest-earning assets was up 49 basis points to 3.83%.

 

Chairman and CEO Lynn Harton stated, “This was a great quarter on multiple fronts for United as our businesses and our markets continue to provide solid growth opportunities. Loan growth and an expanding net interest margin propelled our pre-tax, pre-provision ROA and our efficiency ratio to record levels for the company. Deposits fell as anticipated due to higher-yielding market alternatives provided by increasing interest rates, however our core deposit base continues to provide strong liquidity for the company.”

 

Harton continued, “From a strategic perspective, we continued to strengthen our Board of Directors with the appointment of George Bell, an experienced information technology executive who has more than 35 years in large financial institutions, with a specific emphasis on Customer Information Management. He brings an incredible depth of knowledge in leveraging technology to improve products and services, enhancing customer experience, and increasing organizational productivity. We are excited to have George join United as we continue to grow and expand our capabilities.”

 

 

 

 

Harton concluded, “Finally, our thoughts are with the people, communities and businesses in Florida who are recovering from the devastating impact of Hurricane Ian. We are fortunate to report that United sustained no loss of life or property.”

 

Third Quarter 2022 Financial Highlights:

 

·Net income of $81.2 million and pre-tax, pre-provision income of $118.9 million

 

·EPS decreased by 10% compared to third quarter 2021 on a GAAP basis and on an operating basis; compared to second quarter of 2022, EPS increased by 21% on a GAAP basis and increased 14% on an operating basis

 

·Return on assets of 1.32%, or 1.34% on an operating basis

 

·Pre-tax, pre-provision return on assets of 1.94%, or 1.97% on an operating basis

 

·Return on common equity of 11.02%

 

·Return on tangible common equity of 15.60% on an operating basis

 

·A provision for credit losses of $15.4 million, which increased the allowance for loan losses to 1.12% of loans from 1.05% in the second quarter

 

·Loan production of $1.6 billion, resulting in loan growth of 9.4% annualized for the quarter

 

·Core transaction deposits were down $225 million, which represents a decline of 5% annualized for the quarter

 

·Net interest margin of 3.57% was up 38 basis points from the second quarter, due to the effect of higher interest rates

 

·Mortgage closings were $317 million compared to $568 million a year ago; mortgage rate locks were $456 million compared to $731 million a year ago

 

·Noninterest income was down $1.5 million on a linked quarter basis, primarily driven by lower lock volume driven by higher interest rates

 

·Noninterest expenses decreased by $8.0 million compared to the second quarter on a GAAP basis and by $2.6 million on an operating basis, primarily driven by lower merger-related charges as the second quarter included costs for the Reliant systems conversion

 

·Efficiency ratio improved to historically low levels of 48.4%, or 47.7% on an operating basis

 

·Net charge-offs were $1.1 million or 3 basis points as a percent of average loans, up 6 basis points from the net recoveries experienced in the second quarter

 

·Nonperforming assets were 0.15% of total assets, an increase of 1 basis point compared to June 30, 2022

 

·Quarterly common shareholder dividend was $0.22 per share declared during the quarter, an increase of 10% year-over-year

 

 

 

 

Conference Call

 

United will hold a conference call on Wednesday, October 19, 2022, at 11:00 am EST to discuss the contents of this press release and to share business highlights for the quarter. Participants can pre-register for the conference call by navigating to https://dpregister.com/sreg/10171644/f49bf32028. Those without internet access or unable to pre-register may dial in by calling 1-866-777-2509. Participants are encouraged to dial in 15 minutes prior to the call start time. The conference call also will be webcast and can be accessed by selecting “Events and Presentations” under “News and Events” within the Investor Relations section of the company's website, www.ucbi.com.

 

 

 

 

UNITED COMMUNITY BANKS, INC.                    
Selected Financial Information                    
(in thousands, except per share data)                    

 

   2022   2021   Third
Quarter
2022 -		   For the Nine Months
Ended September 30,		   YTD
2022 -		 
  

Third

Quarter

   Second
Quarter		  

First

Quarter

   Fourth
Quarter		  

Third

Quarter

  

2021

Change

   2022   2021   2021
Change		 
INCOME SUMMARY                                           
Interest revenue  $213,887   $187,378   $171,059   $143,768   $147,675       $572,324   $435,026     
Interest expense   14,113    8,475    7,267    6,213    6,636        29,855    23,547     
Net interest revenue   199,774    178,903    163,792    137,555    141,039   42%   542,469    411,479   32%
Provision for (release of) credit losses   15,392    5,604    23,086    (647)   (11,034)       44,082    (36,903)    
Noninterest income   31,922    33,458    38,973    37,177    40,095   (20)   104,353    120,641   (14)
Total revenue   216,304    206,757    179,679    175,379    192,168   13    602,740    569,023   6 
Noninterest expenses   112,755    120,790    119,275    109,156    96,749   17    352,820    287,483   23 
Income before income tax expense   103,549    85,967    60,404    66,223    95,419   9    249,920    281,540   (11)
Income tax expense   22,388    19,125    12,385    14,204    21,603   4    53,898    63,758   (15)
Net income   81,161    66,842    48,019    52,019    73,816   10    196,022    217,782   (10)
Merger-related and other charges   1,746    7,143    9,016    9,912    1,437        17,905    4,058     
Income tax benefit of merger-related and other charges   (385)   (1,575)   (1,963)   (2,265)   (328)       (3,923)   (909)    
Net income - operating (1)  $82,522   $72,410   $55,072   $59,666   $74,925   10   $210,004   $220,931   (5)
Pre-tax pre-provision income (5)  $118,941   $91,571   $83,490   $65,576   $84,385   41   $294,002   $244,637   20 
PERFORMANCE MEASURES                                           
Per common share:                                           
Diluted net income - GAAP  $0.74   $0.61   $0.43   $0.55   $0.82   (10)  $1.78   $2.42   (26)
Diluted net income - operating (1)   0.75    0.66    0.50    0.64    0.83   (10)   1.91    2.45   (22)
Cash dividends declared   0.22    0.21    0.21    0.20    0.20   10    0.64    0.58   10 
Book value   23.78    23.96    24.38    23.63    23.25   2    23.78    23.25   2 
Tangible book value (3)   16.52    16.68    17.08    18.42    18.68   (12)   16.52    18.68   (12)
Key performance ratios:                                           
Return on common equity - GAAP (2)(4)   11.02%   9.31%   6.80%   9.32%   14.26%       9.08%   14.55%    
Return on common equity - operating (1)(2)(4)   11.21    10.10    7.83    10.74    14.48        9.75    14.77     
Return on tangible common equity - operating (1)(2)(3)(4)   15.60    14.20    11.00    13.93    18.23        13.64    18.55     
Return on assets - GAAP (4)   1.32    1.08    0.78    0.96    1.48        1.06    1.52     
Return on assets - operating (1)(4)   1.34    1.17    0.89    1.10    1.50        1.13    1.54     
Return on assets - pre-tax pre-provision (4)(5)   1.94    1.49    1.37    1.21    1.70        1.60    1.71     
Return on assets - pre-tax pre-provision, excluding  merger- related and other charges (1)(4)(5)   1.97    1.60    1.52    1.40    1.73        1.70    1.74     
Net interest margin (fully taxable equivalent) (4)   3.57    3.19    2.97    2.81    3.12        3.25    3.17     
Efficiency ratio - GAAP   48.41    56.58    57.43    62.12    53.11        53.94    53.72     
Efficiency ratio - operating (1)   47.66    53.23    53.09    56.48    52.33        51.20    52.97     
Equity to total assets   11.12    10.95    11.06    10.61    10.89        11.12    10.89     
Tangible common equity to tangible assets (3)   7.70    7.59    7.72    8.09    8.53        7.70    8.53     
ASSET QUALITY                                           
Nonperforming assets ("NPAs")  $35,511   $34,428   $40,816   $32,855   $45,335   (22)  $35,511   $45,335   (22)
Allowance for credit losses - loans   148,502    136,925    132,805    102,532    99,620   49    148,502    99,620   49 
Allowance for credit losses - total   167,300    153,042    146,369    113,524    110,875        167,300    110,875     
Net charge-offs (recoveries)   1,134    (1,069)   2,978    248    551        3,043    (210)    
Allowance for credit losses - loans to loans   1.00%   0.94%   0.93%   0.87%   0.89%       1.00%   0.89%    
Allowance for credit losses - total to loans   1.12    1.05    1.02    0.97    0.99        1.12    0.99     
Net charge-offs to average loans (4)   0.03    (0.03)   0.08    0.01    0.02        0.03    —     
NPAs to total assets   0.15    0.14    0.17    0.16    0.23        0.15    0.23     
AT PERIOD END ($ in millions)                                           
Loans  $14,882   $14,541   $14,316   $11,760   $11,191   33   $14,882   $11,191   33 
Investment securities   6,539    6,683    6,410    5,653    5,335   23    6,539    5,335   23 
Total assets   23,688    24,213    24,374    20,947    19,481   22    23,688    19,481   22 
Deposits   20,321    20,873    21,056    18,241    16,865   20    20,321    16,865   20 
Shareholders’ equity   2,635    2,651    2,695    2,222    2,122   24    2,635    2,122   24 
Common shares outstanding (thousands)   106,163    106,034    106,025    89,350    86,559   23    106,163    86,559   23 

 

(1) Excludes merger-related and other charges.

(2) Net income less preferred stock dividends, divided by average realized common equity, which excludes accumulated other comprehensive income (loss).

(3) Excludes effect of acquisition related intangibles and associated amortization.

(4) Annualized.

(5) Excludes income tax expense and provision for credit losses. 

 

 

 

 

UNITED COMMUNITY BANKS, INC.

Non-GAAP Performance Measures Reconciliation

Selected Financial Information

(in thousands, except per share data)

 

   2022   2021   For the Nine Months Ended
September 30,		 
   Third
Quarter		   Second
Quarter		   First
Quarter		   Fourth
Quarter		   Third
Quarter		   2022   2021 
Noninterest expense reconciliation                                   
Noninterest expenses (GAAP)  $112,755   $120,790   $119,275   $109,156   $96,749   $352,820   $287,483 
Merger-related and other charges   (1,746)   (7,143)   (9,016)   (9,912)   (1,437)   (17,905)   (4,058)
Noninterest expenses - operating  $111,009   $113,647   $110,259   $99,244   $95,312   $334,915   $283,425 
                                    
Net income reconciliation                                   
Net income (GAAP)  $81,161   $66,842   $48,019   $52,019   $73,816   $196,022   $217,782 
Merger-related and other charges   1,746    7,143    9,016    9,912    1,437    17,905    4,058 
Income tax benefit of merger-related and other charges   (385)   (1,575)   (1,963)   (2,265)   (328)   (3,923)   (909)
Net income - operating  $82,522   $72,410   $55,072   $59,666   $74,925   $210,004   $220,931 
                                    
Net income to pre-tax pre-provision income reconciliation                                   
Net income (GAAP)  $81,161   $66,842   $48,019   $52,019   $73,816   $196,022   $217,782 
Income tax expense   22,388    19,125    12,385    14,204    21,603    53,898    63,758 
Provision for (release of) credit losses   15,392    5,604    23,086    (647)   (11,034)   44,082    (36,903)
Pre-tax pre-provision income  $118,941   $91,571   $83,490   $65,576   $84,385   $294,002   $244,637 
                                    
Diluted income per common share reconciliation                                   
Diluted income per common share (GAAP)  $0.74   $0.61   $0.43   $0.55   $0.82   $1.78   $2.42 
Merger-related and other charges, net of tax   0.01    0.05    0.07    0.09    0.01    0.13    0.03 
Diluted income per common share - operating  $0.75   $0.66   $0.50   $0.64   $0.83   $1.91   $2.45 
                                    
Book value per common share reconciliation                                   
Book value per common share (GAAP)  $23.78   $23.96   $24.38   $23.63   $23.25   $23.78   $23.25 
Effect of goodwill and other intangibles   (7.26)   (7.28)   (7.30)   (5.21)   (4.57)   (7.26)   (4.57)
Tangible book value per common share  $16.52   $16.68   $17.08   $18.42   $18.68   $16.52   $18.68 
                                    
Return on tangible common equity reconciliation                                   
Return on common equity (GAAP)   11.02%   9.31%   6.80%   9.32%   14.26%   9.08%   14.55%
Merger-related and other charges, net of tax   0.19    0.79    1.03    1.42    0.22    0.67    0.22 
Return on common equity - operating   11.21    10.10    7.83    10.74    14.48    9.75    14.77 
Effect of goodwill and other intangibles   4.39    4.10    3.17    3.19    3.75    3.89    3.78 
Return on tangible common equity - operating   15.60%   14.20%   11.00%   13.93%   18.23%   13.64%   18.55%
                                    
Return on assets reconciliation                                   
Return on assets (GAAP)   1.32%   1.08%   0.78%   0.96%   1.48%   1.06%   1.52%
Merger-related and other charges, net of tax   0.02    0.09    0.11    0.14    0.02    0.07    0.02 
Return on assets - operating   1.34%   1.17%   0.89%   1.10%   1.50%   1.13%   1.54%
                                    
Return on assets to return on assets- pre-tax pre-provision reconciliation                                   
Return on assets (GAAP)   1.32%   1.08%   0.78%   0.96%   1.48%   1.06%   1.52%
Income tax expense   0.37    0.32    0.20    0.26    0.45    0.30    0.45 
(Release of) provision for credit losses   0.25    0.09    0.39    (0.01)   (0.23)   0.24    (0.26)
Return on assets - pre-tax, pre-provision   1.94    1.49    1.37    1.21    1.70    1.60    1.71 
Merger-related and other charges   0.03    0.11    0.15    0.19    0.03    0.10    0.03 
Return on assets - pre-tax pre-provision, excluding merger-related and other charges   1.97%   1.60%   1.52%   1.40%   1.73%   1.70%   1.74%
                                    
Efficiency ratio reconciliation                                   
Efficiency ratio (GAAP)   48.41%   56.58%   57.43%   62.12%   53.11%   53.94%   53.72%
Merger-related and other charges   (0.75)   (3.35)   (4.34)   (5.64)   (0.78)   (2.74)   (0.75)
Efficiency ratio - operating   47.66%   53.23%   53.09%   56.48%   52.33%   51.20%   52.97%
                                    
Tangible common equity to tangible assets reconciliation                                   
Equity to total assets (GAAP)   11.12%   10.95%   11.06%   10.61%   10.89%   11.12%   10.89%
Effect of goodwill and other intangibles   —    (2.96)   (2.94)   (2.06)   (1.87)   —    (1.87)
Effect of preferred equity   (3.42)   (0.40)   (0.40)   (0.46)   (0.49)   (3.42)   (0.49)
Tangible common equity to tangible assets   7.70%   7.59%   7.72%   8.09%   8.53%   7.70%   8.53%

 

 

 

 

UNITED COMMUNITY BANKS, INC.

Financial Highlights

Loan Portfolio Composition at Period-End

 

   2022   2021   Linked   Year over 
(in millions)  Third
Quarter		   Second
Quarter		   First
Quarter		   Fourth
Quarter		   Third
Quarter		   Quarter
Change		   Year
Change		 
LOANS BY CATEGORY                                   
Owner occupied commercial RE  $2,700   $2,681   $2,638   $2,322   $2,149   $19   $551 
Income producing commercial RE   3,299    3,273    3,328    2,601    2,542    26    757 
Commercial & industrial   2,236    2,243    2,302    1,822    1,729    (7)   507 
Paycheck protection program   2    10    34    88    150    (8)   (148)
Commercial construction   1,514    1,514    1,482    1,015    947    —    567 
Equipment financing   1,281    1,211    1,148    1,083    1,017    70    264 
Total commercial   11,032    10,932    10,932    8,931    8,534    100    2,498 
Residential mortgage   2,149    1,997    1,826    1,638    1,533    152    616 
Home equity lines of credit   832    801    778    694    661    31    171 
Residential construction   423    381    368    359    321    42    102 
Manufactured housing   301    287    269    —    —    14    301 
Consumer   145    143    143    138    142    2    3 
Total loans  $14,882   $14,541   $14,316   $11,760   $11,191   $341   $3,691 
                                    
LOANS BY MARKET                                   
Georgia  $4,003   $3,960   $3,879   $3,778   $3,732   $43   $271 
South Carolina   2,516    2,377    2,323    2,235    2,145    139    371 
North Carolina   2,117    2,006    1,879    1,895    1,427    111    690 
Tennessee   2,536    2,621    2,661    373    383    (85)   2,153 
Florida   1,259    1,235    1,208    1,148    1,113    24    146 
Commercial Banking Solutions   2,451    2,342    2,366    2,331    2,391    109    60 
Total loans  $14,882   $14,541   $14,316   $11,760   $11,191   $341   $3,691 

 

 

 

 

 

UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality
(in thousands)

 

   2022 
    

Third
Quarter

    

Second
Quarter

    

First
Quarter

 
NONACCRUAL LOANS               
Owner occupied RE  $877   $1,876   $4,590 
Income producing RE   2,663    7,074    7,220 
Commercial & industrial   11,108    4,548    6,227 
Commercial construction   150    208    401 
Equipment financing   3,198    3,249    2,540 
      Total commercial   17,996    16,955    20,978 
Residential mortgage   10,424    12,228    13,024 
Home equity lines of credit   1,151    933    1,183 
Residential construction   104    198    212 
Manufactured housing   4,187    2,804    2,507 
Consumer   17    25    40 
      Total nonaccrual loans held for investment   33,879    33,143    37,944 
Nonaccrual loans held for sale   316    317    2,033 
OREO and repossessed assets   1,316    968    839 
Total NPAs  $35,511   $34,428   $40,816 

 

   2022 
   Third Quarter   Second Quarter   First Quarter 
(in thousands)  Net Charge-
Offs		   Net Charge-
Offs to
Average
Loans (1)		   Net Charge-
Offs		   Net Charge-
Offs to
Average
Loans (1)		   Net Charge-
Offs		   Net Charge-
Offs to
Average
Loans (1)		 
NET CHARGE-OFFS (RECOVERIES) BY CATEGORY                              
Owner occupied RE  $(90)   (0.01)%  $(1,496)   (0.23)%  $(45)   (0.01)%
Income producing RE   176    0.02    (116)   (0.01)   (290)   (0.04)
Commercial & industrial   (744)   (0.13)   (302)   (0.05)   2,929    0.51 
Commercial construction   10    —    (144)   (0.04)   (373)   (0.10)
Equipment financing   1,121    0.36    907    0.31    267    0.10 
     Total commercial   473    0.02    (1,151)   (0.04)   2,488    0.09 
Residential mortgage   (66)   (0.01)   (51)   (0.01)   (97)   (0.02)
Home equity lines of credit   (102)   (0.05)   (346)   (0.18)   (81)   (0.04)
Residential construction   (109)   (0.11)   (76)   (0.08)   (23)   (0.03)
Manufactured housing   220    0.30    135    0.20    164    0.25 
Consumer   718    1.98    420    1.18    527    1.48 
     Total  $1,134    0.03   $(1,069)   (0.03)  $2,978    0.08 

 

(1)  Annualized.  

 

 

 

 

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

 

(in thousands, except share and per share data)  September 30,
2022		   December 31,
2021		 
ASSETS          
Cash and due from banks  $222,524   $144,244 
Interest-bearing deposits in banks   216,496    2,147,266 
Federal funds and other short-term investments   45,000    27,000 
Cash and cash equivalents   484,020    2,318,510 
Debt securities available-for-sale   3,862,886    4,496,824 
Debt securities held-to-maturity (fair value $2,241,160 and $1,148,804, respectively)   2,676,405    1,156,098 
Loans held for sale   21,967    44,109 
Loans and leases held for investment   14,882,484    11,760,346 
Less allowance for credit losses - loans and leases   (148,502)   (102,532)
Loans and leases, net   14,733,982    11,657,814 
Premises and equipment, net   288,597    245,296 
Bank owned life insurance   300,365    217,713 
Goodwill and other intangible assets, net   780,868    472,407 
Other assets   538,765    338,000 
Total assets  $23,687,855   $20,946,771 
LIABILITIES AND SHAREHOLDERS' EQUITY          
Liabilities:          
Deposits:          
Noninterest-bearing demand  $8,198,129   $6,956,981 
NOW and interest-bearing demand   4,208,731    4,252,209 
Money market   4,638,509    4,183,354 
Savings   1,508,557    1,215,779 
Time   1,622,608    1,442,498 
Brokered   144,608    190,358 
Total deposits   20,321,142    18,241,179 
Long-term debt   324,515    247,360 
Accrued expenses and other liabilities   407,488    235,987 
Total liabilities   21,053,145    18,724,526 
Shareholders' equity:          
Preferred stock; $1 par value; 10,000,000 shares authorized; 4,000 shares Series I issued and outstanding, $25,000 per share liquidation preference   96,422    96,422 
Common stock, $1 par value; 200,000,000 shares authorized, 106,162,861 and 89,349,826 shares issued and outstanding, respectively   106,163    89,350 
Common stock issuable; 596,365 and 595,705 shares, respectively   11,966    11,288 
Capital surplus   2,304,514    1,721,007 
Retained earnings   452,788    330,654 
Accumulated other comprehensive loss   (337,143)   (26,476)
Total shareholders' equity   2,634,710    2,222,245 
Total liabilities and shareholders' equity  $23,687,855   $20,946,771 

 

 

 

 

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

 

  

Three Months Ended
September 30,

  

Nine Months Ended
September 30,

 
(in thousands, except per share data)  2022   2021   2022   2021 
Interest revenue:                    
Loans, including fees  $174,065   $128,477   $476,072   $382,261 
Investment securities, including tax exempt of $2,568, $2,280, $7,762 and $6,685, respectively   36,953    18,540    91,043    51,530 
Deposits in banks and short-term investments   2,869    658    5,209    1,235 
Total interest revenue   213,887    147,675    572,324    435,026 
                     
Interest expense:                    
Deposits:                    
NOW and interest-bearing demand   3,992    1,290    7,624    4,158 
Money market   4,503    1,119    7,030    4,278 
Savings   178    55    337    157 
Time   1,207    678    2,322    3,388 
Deposits   9,880    3,142    17,313    11,981 
Short-term borrowings   27    —    27    2 
Long-term debt   4,206    3,494    12,515    11,564 
Total interest expense   14,113    6,636    29,855    23,547 
Net interest revenue   199,774    141,039    542,469    411,479 
Provision for (release of) credit losses   15,392    (11,034)   44,082    (36,903)
Net interest revenue after provision for credit losses   184,382    152,073    498,387    448,382 
                     
Noninterest income:                    
Service charges and fees   9,569    9,350    28,644    25,255 
Mortgage loan gains and other related fees   6,297    13,828    29,420    47,536 
Wealth management fees   5,879    5,554    17,759    12,881 
Gains from sales of other loans, net   2,228    2,353    9,226    7,506 
Lending and loan servicing fees   2,946    2,825    7,518    7,070 
Securities gains (losses), net   —    —    (3,688)   41 
Other   5,003    6,185    15,474    20,352 
Total noninterest income   31,922    40,095    104,353    120,641 
Total revenue   216,304    192,168    602,740    569,023 
                     
Noninterest expenses:                    
Salaries and employee benefits   67,823    60,458    208,062    180,457 
Communications and equipment   8,795    7,368    27,718    21,979 
Occupancy   9,138    7,096    27,381    21,130 
Advertising and public relations   2,544    1,458    6,332    4,150 
Postage, printing and supplies   2,190    1,731    6,308    5,171 
Professional fees   4,821    5,347    14,670    14,509 
Lending and loan servicing expense   2,333    2,450    7,746    8,508 
Outside services - electronic banking   3,159    2,308    8,629    6,811 
FDIC assessments and other regulatory charges   2,356    1,723    6,796    5,520 
Amortization of intangibles   1,678    1,028    5,207    2,942 
Merger-related and other charges   1,746    1,437    17,905    4,058 
Other   6,172    4,345    16,066    12,248 
Total noninterest expenses   112,755    96,749    352,820    287,483 
Income before income taxes   103,549    95,419    249,920    281,540 
Income tax expense   22,388    21,603    53,898    63,758 
Net income   81,161    73,816    196,022    217,782 
Preferred stock dividends   1,719    1,719    5,157    5,157 
Earnings allocated to participating securities   407    448    1,007    1,342 
Net income available to common shareholders  $79,035   $71,649   $189,858   $211,283 
                     
Net income per common share:                    
Basic  $0.74   $0.82   $1.78   $2.42 
Diluted   0.74    0.82    1.78    2.42 
Weighted average common shares outstanding:                    
Basic   106,687    87,211    106,616    87,274 
Diluted   106,800    87,355    106,732    87,413 

 

 

 

 

Average Consolidated Balance Sheets and Net Interest Analysis
For the Three Months Ended September 30,

 

   2022   2021 
(dollars in thousands, fully taxable equivalent (FTE))  Average
Balance		   Interest   Average
Rate		   Average
Balance		   Interest   Average
Rate		 
Assets:                              
Interest-earning assets:                              
Loans, net of unearned income (FTE) (1)(2)  $14,658,397   $174,168    4.71%  $11,204,653   $128,185    4.54%
Taxable securities (3)   6,539,615    34,385    2.10    4,738,860    16,260    1.37 
Tax-exempt securities (FTE) (1)(3)   493,115    3,449    2.80    383,196    3,061    3.20 
Federal funds sold and other interest-earning assets   614,755    3,106    2.00    1,751,222    1,185    0.27 
Total interest-earning assets (FTE)   22,305,882    215,108    3.83    18,077,931    148,691    3.27 
                               
Noninterest-earning assets:                              
Allowance for credit losses   (138,907)             (111,952)          
Cash and due from banks   231,376              124,360           
Premises and equipment   290,768              228,556           
Other assets (3)   1,261,236              1,002,810           
Total assets  $23,950,355             $19,321,705           
                               
Liabilities and Shareholders' Equity:                              
Interest-bearing liabilities:                              
Interest-bearing deposits:                              
NOW and interest-bearing demand  $4,335,619    3,992    0.37   $3,594,670    1,290    0.14 
Money market   4,849,705    4,503    0.37    4,010,720    1,119    0.11 
Savings   1,515,350    178    0.05    1,120,843    55    0.02 
Time   1,635,580    984    0.24    1,466,821    609    0.16 
Brokered time deposits   51,530    223    1.72    63,917    69    0.43 
Total interest-bearing deposits   12,387,784    9,880    0.32    10,256,971    3,142    0.12 
Federal funds purchased and other borrowings   3,442    27    3.11    —    —    — 
Federal Home Loan Bank advances   —    —    —    54    —    — 
Long-term debt   324,444    4,206    5.14    257,139    3,494    5.39 
Total borrowed funds   327,886    4,233    5.12    257,193    3,494    5.39 
Total interest-bearing liabilities   12,715,670    14,113    0.44    10,514,164    6,636    0.25 
                               
Noninterest-bearing liabilities:                              
Noninterest-bearing deposits   8,176,987              6,379,969           
Other liabilities   349,647              308,551           
Total liabilities   21,242,304              17,202,684           
Shareholders' equity   2,708,051              2,119,021           
Total liabilities and shareholders' equity  $23,950,355             $19,321,705           
                               
Net interest revenue (FTE)       $200,995             $142,055      
Net interest-rate spread (FTE)             3.39%             3.02%
Net interest margin (FTE) (4)             3.57%             3.12%

 

(1)Interest revenue on tax-exempt securities and loans has been increased to reflect comparable interest on taxable securities and loans. The rate used was 26%, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate.
(2)Included in the average balance of loans outstanding are loans on which the accrual of interest has been discontinued and loans that are held for sale.
(3)Unrealized gains and losses on securities, including those related to the transfer from AFS to HTM, have been reclassified to other assets. Pretax unrealized losses of $318 million in 2022 and pretax unrealized gains of $39.6 million in 2021 are included in other assets for purposes of this presentation.
(4)Net interest margin is taxable equivalent net interest revenue divided by average interest-earning assets.

 

 

 

Average Consolidated Balance Sheets and Net Interest Analysis
For the Nine Months Ended September 30,

 

   2022   2021 
(dollars in thousands, fully taxable equivalent (FTE))  Average
Balance		   Interest   Average
Rate		   Average
Balance		   Interest   Average
Rate		 
Assets:                              
Interest-earning assets:                              
Loans, net of unearned income (FTE) (1)(2)  $14,426,470   $475,989    4.41%  $11,417,285   $380,765    4.46%
Taxable securities (3)   6,274,230    83,281    1.77    4,206,099    44,845    1.42 
Tax-exempt securities (FTE) (1)(3)   498,177    10,425    2.79    381,323    8,979    3.14 
Federal funds sold and other interest-earning assets   1,271,287    6,192    0.65    1,468,487    3,462    0.31 
Total interest-earning assets (FTE)   22,470,164    575,887    3.43    17,473,194    438,051    3.35 
                               
Non-interest-earning assets:                              
Allowance for loan losses   (129,278)             (127,793)          
Cash and due from banks   200,463              138,973           
Premises and equipment   284,850              225,021           
Other assets (3)   1,308,647              1,007,669           
Total assets  $24,134,846             $18,717,064           
                               
Liabilities and Shareholders' Equity:                              
Interest-bearing liabilities:                              
Interest-bearing deposits:                              
NOW and interest-bearing demand  $4,520,079    7,624    0.23   $3,452,206    4,158    0.16 
Money market   4,992,357    7,030    0.19    3,853,907    4,278    0.15 
Savings   1,483,169    337    0.03    1,064,045    157    0.02 
Time   1,688,250    2,009    0.16    1,551,934    3,096    0.27 
Brokered time deposits   65,133    313    0.64    67,794    292    0.58 
Total interest-bearing deposits   12,748,988    17,313    0.18    9,989,886    11,981    0.16 
Federal funds purchased and other borrowings   1,383    27    2.61    41    —    — 
Federal Home Loan Bank advances   —    —    —    1,117    2    0.24 
Long-term debt   322,600    12,515    5.19    286,347    11,564    5.40 
Total borrowed funds   323,983    12,542    5.18    287,505    11,566    5.38 
Total interest-bearing liabilities   13,072,971    29,855    0.31    10,277,391    23,547    0.31 
                               
Noninterest-bearing liabilities:                              
Noninterest-bearing deposits   7,958,392              6,059,680           
Other liabilities   375,182              311,749           
Total liabilities   21,406,545              16,648,820           
Shareholders' equity   2,728,301              2,068,244           
Total liabilities and shareholders' equity  $24,134,846             $18,717,064           
                               
Net interest revenue (FTE)       $546,032             $414,504      
Net interest-rate spread (FTE)             3.12%             3.04%
Net interest margin (FTE) (4)             3.25%             3.17%

 

(1)Interest revenue on tax-exempt securities and loans has been increased to reflect comparable interest on taxable securities and loans. The rate used was 26%, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate.
(2)Included in the average balance of loans outstanding are loans on which the accrual of interest has been discontinued and loans that are held for sale.
(3)Unrealized gains and losses on securities, including those related to the transfer from AFS to HTM, have been reclassified to other assets. Pretax unrealized losses of $221 million in 2022 and pretax unrealized gains of $40.3 million in 2021, respectively, are included in other assets for purposes of this presentation.
(4)Net interest margin is taxable equivalent net-interest revenue divided by average interest-earning assets.

 

 

 

 

About United Community Banks, Inc.

 

United Community Banks, Inc. (NASDAQGS: UCBI) provides a full range of banking, wealth management and mortgage services for relationship-oriented consumers and business owners. As of September 30, 2022, United had $23.7 billion in assets and 193 offices in Florida, Georgia, North Carolina, South Carolina and Tennessee, along with a national SBA lending franchise and a national equipment lending subsidiary. The company, known as “The Bank That SERVICE Built,” has been recognized nationally for delivering award-winning service. In 2022, J.D. Power ranked United highest in customer satisfaction with consumer banking in the Southeast, marking eight out of the last nine years United earned the coveted award. Forbes recognized United as one of the top ten World’s Best Banks in 2022. Forbes also included United on its 2022 list of the 100 Best Banks in America for the ninth consecutive year. United also received ten Greenwich Excellence Awards in 2021 for excellence in Small Business Banking and Middle Market Banking, including national awards for Overall Satisfaction and Likelihood to Recommend. United was also named one of the "Best Banks to Work For" by American Banker in 2021 for the fifth consecutive year based on employee satisfaction. Additional information about United can be found at www.ucbi.com.

 

Non-GAAP Financial Measures

 

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

 

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