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United Community Banks, Inc. Reports Third Quarter Results
ソース: Nasdaq GlobeNewswire / 23 10 2024 07:30:01 America/New_York
GREENVILLE, S.C. , Oct. 23, 2024 (GLOBE NEWSWIRE) -- United Community Banks, Inc. (NYSE: UCB) (United) today announced net income for the 2024 third quarter of $47.3 million and pre-tax, pre-provision income of $74.2 million. The result included the previously announced strategic decision to sell $318 million in manufactured housing loans, which negatively impacted the quarter by $21.4 million after-tax, or $0.18 per share. Diluted earnings per share of $0.38 for the quarter represented a decrease of $0.01, or 3%, from the third quarter a year ago and a decrease of $0.16, or 30%, from the second quarter of 2024.
On an operating basis, United’s diluted earnings per share of $0.57 was up 27% from the year-ago quarter. The primary drivers of the increased earnings per share year-over-year were higher net interest income and a lower provision for credit losses. The $0.57 result includes a $9.9 million Hurricane Helene related loan loss provision to increase the reserve on $383 million of loans in nine North Carolina counties impacted by the hurricane to 3.5% of loans.
United’s return on assets was 0.67%, or 1.01% on an operating basis. Return on common equity was 5.20% and return on tangible common equity on an operating basis was 11.17%. On a pre-tax, pre-provision basis, operating return on assets was 1.50% for the quarter. At quarter-end, tangible common equity to tangible assets was 8.93%, up 15 basis points from the second quarter of 2024.
Chairman and CEO Lynn Harton stated, “We continue to focus on growth and the third quarter saw the return of modest loan and strong deposit growth. Excluding the sale of our manufactured housing portfolio, announced in early September, loan balances were up 1.5% annualized. Customer deposits, which exclude brokered deposits, were up $262 million, or 5% annualized. Our balance sheet remains highly liquid and our internal capital generation rate is running well in excess of our current capital needs. We maintained robust capital ratios with our preliminary CET1 moving to 13.1% and we opportunistically redeemed $8 million of relatively expensive Trust Preferred securities. The increase in liquidity and capital place us in a great position to take advantage of growth opportunities as we move into 2025.”
Mr. Harton continued, “We elected to sell our manufactured housing loan book, a business that was part of our Reliant Bancorp, Inc. acquisition in January of 2022, as a natural conclusion of our exit from the business, as we ceased originating loans in the third quarter of 2023. The transaction reduces our risk profile and allows us to allocate capital to other growth opportunities.”
United’s net interest margin decreased four basis points to 3.33% from the second quarter. The average yield on United’s interest-earning assets was down four basis points to 5.55%, while its cost of interest-bearing liabilities decreased two basis points, leading to the four-basis point reduction in net interest margin. Net charge-offs were $23.7 million, or 0.52% of average loans, during the quarter, up 26 basis points compared to the second quarter of 2024 due to transaction-related losses resulting from the sale of our manufactured housing portfolio. NPAs were 42 basis points relative to total assets, down one basis point from the second quarter.
Mr. Harton concluded, “We are pleased with our operating performance this quarter, but we were also reminded this quarter of the importance of community. Many of our employees, customers, and communities have been impacted by the recent hurricanes. We are actively involved in the recovery process through volunteer hours and financial support and will be ready to lead the rebuilding process, when and as needed. Many thanks to our employees throughout the company that have responded, in sometimes heroic ways, to support each other and our customers.”
Third Quarter 2024 Financial Highlights:
- Net income of $47.3 million and pre-tax, pre-provision income of $74.2 million
- EPS down 3% compared to third quarter 2023 on a GAAP basis and up 27% on an operating basis; compared to second quarter 2024, EPS down 30% on a GAAP basis and down 2% on an operating basis
- The GAAP results were impacted by the decision to sell the manufactured housing loan book at a $21.4 million after-tax loss, or $0.18, approximately one year after making the strategic decision to cease originations
- Return on assets of 0.67%, or 1.01% on an operating basis
- Pre-tax, pre-provision return on assets of 1.50% on an operating basis
- Return on common equity of 5.20%
- Return on tangible common equity of 11.17% on an operating basis
- A provision for credit losses of $14.4 million, which includes $9.9 million to establish a special reserve for expected credit losses from Hurricane Helene
- Net charge-offs of $23.7 million, or 52 basis points as a percent of average loans, which included $11.0 million, or 24 basis points, of transaction-related losses from the sale of our manufactured housing portfolio
- Nonperforming assets of 0.42% of total assets, down one basis point compared to June 30, 2024
- Loan production of $1.2 billion
- Customer deposits were up $262 million from the second quarter, with most of the growth in NOW and money market deposits
- Net interest margin of 3.33% decreased by four basis points from the second quarter mostly due to lower purchased loan accretion, the sale of our manufactured housing portfolio, and changing composition of our earning assets and interest-bearing liabilities
- Mortgage closings of $239 million compared to $211 million a year ago; mortgage rate locks of $306 million compared to $304 million a year ago
- Noninterest income was down $28.5 million on a linked quarter basis with $27.2 million due to losses from the sale of manufactured housing loans. The remaining decrease was primarily driven by the mark on our mortgage servicing rights asset.
- Noninterest expenses decreased by $4.0 million compared to the second quarter on a GAAP basis and were up $0.3 million on an operating basis
- Efficiency ratio of 65.5%, or 57.4% on an operating basis
- Maintained robust capital ratios with preliminary CET1 increasing to 13.1% and opportunistically redeemed $8 million of relatively expensive Trust Preferred securities
- Quarterly common dividend of $0.24 per share declared during the quarter, up 4% year-over-year
Conference Call
United will hold a conference call on Wednesday, October 23, 2024 at 11 a.m. ET to discuss the contents of this press release and to share business highlights for the quarter. Participants can pre-register for the conference call by navigating to https://dpregister.com/sreg/10193157/fd9f74293a. Those without internet access or unable to pre-register may dial in by calling 1-866-777-2509. Participants are encouraged to dial in 15 minutes prior to the call start time. The conference call also will be webcast and can be accessed by selecting “Events and Presentations” under “News and Events” within the Investor Relations section of the company's website, www.ucbi.com.UNITED COMMUNITY BANKS, INC. Selected Financial Information (In thousands, except per share data) 2024 2023 Third
Quarter
2024-
2023
ChangeFor the Nine Months
Ended September 30,YTD
2024-
2023
ChangeThird
QuarterSecond
QuarterFirst
QuarterFourth
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Quarter2024 2023 INCOME SUMMARY Interest revenue $ 349,086 $ 346,965 $ 336,728 $ 338,698 $ 323,147 $ 1,032,779 $ 898,409 Interest expense 139,900 138,265 137,579 135,245 120,591 415,744 284,097 Net interest revenue 209,186 208,700 199,149 203,453 202,556 3 % 617,035 614,312 — % Provision for credit losses 14,428 12,235 12,899 14,626 30,268 39,562 74,804 Noninterest income 8,091 36,556 39,587 (23,090 ) 31,977 (75 ) 84,234 98,573 (15 ) Total revenue 202,849 233,021 225,837 165,737 204,265 (1 ) 661,707 638,081 4 Noninterest expenses 143,065 147,044 145,002 154,587 144,474 (1 ) 435,111 416,686 4 Income before income tax expense 59,784 85,977 80,835 11,150 59,791 — 226,596 221,395 2 Income tax expense 12,437 19,362 18,204 (2,940 ) 11,925 4 50,003 47,941 4 Net income 47,347 66,615 62,631 14,090 47,866 (1 ) 176,593 173,454 2 Non-operating items 29,385 6,493 2,187 67,450 9,168 38,065 21,444 Income tax benefit of non-operating items (6,276 ) (1,462 ) (493 ) (16,714 ) (2,000 ) (8,231 ) (4,775 ) Net income - operating(1) $ 70,456 $ 71,646 $ 64,325 $ 64,826 $ 55,034 28 $ 206,427 $ 190,123 9 Pre-tax pre-provision income(5) $ 74,212 $ 98,212 $ 93,734 $ 25,776 $ 90,059 (18 ) $ 266,158 $ 296,199 (10 ) PERFORMANCE MEASURES Per common share: Diluted net income - GAAP $ 0.38 $ 0.54 $ 0.51 $ 0.11 $ 0.39 (3 ) $ 1.43 $ 1.44 (1 ) Diluted net income - operating(1) 0.57 0.58 0.52 0.53 0.45 27 1.67 1.58 6 Cash dividends declared 0.24 0.23 0.23 0.23 0.23 4 0.70 0.69 1 Book value 27.68 27.18 26.83 26.52 25.87 7 27.68 25.87 7 Tangible book value(3) 19.66 19.13 18.71 18.39 17.70 11 19.66 17.70 11 Key performance ratios: Return on common equity - GAAP(2)(4) 5.20 % 7.53 % 7.14 % 1.44 % 5.32 % 6.61 % 6.69 % Return on common equity - operating(1)(2)(4) 7.82 8.12 7.34 7.27 6.14 7.76 7.35 Return on tangible common equity - operating(1)(2)(3)(4) 11.17 11.68 10.68 10.58 9.03 11.18 10.65 Return on assets - GAAP(4) 0.67 0.97 0.90 0.18 0.68 0.85 0.86 Return on assets - operating(1)(4) 1.01 1.04 0.93 0.92 0.79 0.99 0.95 Return on assets - pre-tax pre-provision - operating(1)(4)(5) 1.50 1.54 1.40 1.33 1.44 1.48 1.60 Net interest margin (fully taxable equivalent)(4) 3.33 3.37 3.20 3.19 3.24 3.30 3.41 Efficiency ratio - GAAP 65.51 59.70 60.47 66.33 61.32 61.76 58.06 Efficiency ratio - operating(1) 57.37 57.06 59.15 59.57 57.43 57.84 55.07 Equity to total assets 12.45 12.35 12.06 11.95 11.85 12.45 11.85 Tangible common equity to tangible assets(3) 8.93 8.78 8.49 8.36 8.18 8.93 8.18 ASSET QUALITY Nonperforming assets ("NPAs") $ 114,960 $ 116,722 $ 107,230 $ 92,877 $ 90,883 26 $ 114,960 $ 90,883 26 Allowance for credit losses - loans 205,290 213,022 210,934 208,071 201,557 2 205,290 201,557 2 Allowance for credit losses - total 215,517 224,740 224,119 224,128 219,624 (2 ) 215,517 219,624 (2 ) Net charge-offs 23,651 11,614 12,908 10,122 26,638 48,173 42,121 Allowance for credit losses - loans to loans 1.14 % 1.17 % 1.15 % 1.14 % 1.11 % 1.14 % 1.11 % Allowance for credit losses - total to loans 1.20 1.23 1.22 1.22 1.21 1.20 1.21 Net charge-offs to average loans(4) 0.52 0.26 0.28 0.22 0.59 0.35 0.32 NPAs to total assets 0.42 0.43 0.39 0.34 0.34 0.42 0.34 AT PERIOD END ($ in millions) Loans $ 17,964 $ 18,211 $ 18,375 $ 18,319 $ 18,203 (1 ) $ 17,964 $ 18,203 (1 ) Investment securities 6,425 6,038 5,859 5,822 5,701 13 6,425 5,701 13 Total assets 27,373 27,057 27,365 27,297 26,869 2 27,373 26,869 2 Deposits 23,253 22,982 23,332 23,311 22,858 2 23,253 22,858 2 Shareholders’ equity 3,407 3,343 3,300 3,262 3,184 7 3,407 3,184 7 Common shares outstanding (thousands) 119,283 119,175 119,137 119,010 118,976 — 119,283 118,976 — (1) Excludes non-operating items as detailed on Non-GAAP Performance Measures Reconciliation on next page. (2) Net income less preferred stock dividends, divided by average realized common equity, which excludes accumulated other comprehensive income (loss). (3) Excludes effect of acquisition related intangibles and associated amortization. (4) Annualized. (5) Excludes income tax expense and provision for credit losses.
UNITED COMMUNITY BANKS, INC. Non-GAAP Performance Measures Reconciliation (in thousands, except per share data) 2024 2023 For the Nine Months Ended
September 30,Third
QuarterSecond
QuarterFirst
QuarterFourth
QuarterThird
Quarter2024 2023 Noninterest income reconciliation Noninterest income (GAAP) $ 8,091 $ 36,556 $ 39,587 $ (23,090 ) $ 31,977 $ 84,234 $ 98,573 Loss on sale of manufactured housing loans 27,209 — — — — 27,209 — Gain on lease termination — — (2,400 ) — — (2,400 ) — Bond portfolio restructuring loss — — — 51,689 — — — Noninterest income - operating $ 35,300 $ 36,556 $ 37,187 $ 28,599 $ 31,977 $ 109,043 $ 98,573 Noninterest expense reconciliation Noninterest expenses (GAAP) $ 143,065 $ 147,044 $ 145,002 $ 154,587 $ 144,474 $ 435,111 $ 416,686 Loss on FinTrust (goodwill impairment) — (5,100 ) — — — (5,100 ) — FDIC special assessment — 764 (2,500 ) (9,995 ) — (1,736 ) — Merger-related and other charges (2,176 ) (2,157 ) (2,087 ) (5,766 ) (9,168 ) (6,420 ) (21,444 ) Noninterest expenses - operating $ 140,889 $ 140,551 $ 140,415 $ 138,826 $ 135,306 $ 421,855 $ 395,242 Net income to operating income reconciliation Net income (GAAP) $ 47,347 $ 66,615 $ 62,631 $ 14,090 $ 47,866 $ 176,593 $ 173,454 Loss on sale of manufactured housing loans 27,209 — — — — 27,209 — Bond portfolio restructuring loss — — — 51,689 — — — Gain on lease termination — — (2,400 ) — — (2,400 ) — Loss on FinTrust (goodwill impairment) — 5,100 — — — 5,100 — FDIC special assessment — (764 ) 2,500 9,995 — 1,736 — Merger-related and other charges 2,176 2,157 2,087 5,766 9,168 6,420 21,444 Income tax benefit of non-operating items (6,276 ) (1,462 ) (493 ) (16,714 ) (2,000 ) (8,231 ) (4,775 ) Net income - operating $ 70,456 $ 71,646 $ 64,325 $ 64,826 $ 55,034 $ 206,427 $ 190,123 Net income to pre-tax pre-provision income reconciliation Net income (GAAP) $ 47,347 $ 66,615 $ 62,631 $ 14,090 $ 47,866 $ 176,593 $ 173,454 Income tax expense 12,437 19,362 18,204 (2,940 ) 11,925 50,003 47,941 Provision for credit losses 14,428 12,235 12,899 14,626 30,268 39,562 74,804 Pre-tax pre-provision income $ 74,212 $ 98,212 $ 93,734 $ 25,776 $ 90,059 $ 266,158 $ 296,199 Diluted income per common share reconciliation Diluted income per common share (GAAP) $ 0.38 $ 0.54 $ 0.51 $ 0.11 $ 0.39 $ 1.43 $ 1.44 Loss on sale of manufactured housing loans 0.18 — — — — 0.18 — Bond portfolio restructuring loss — — — 0.32 — — — Gain on lease termination — — (0.02 ) — — (0.02 ) — Loss on FinTrust (goodwill impairment) — 0.03 — — — 0.03 — FDIC special assessment — — 0.02 0.06 — 0.01 — Merger-related and other charges 0.01 0.01 0.01 0.04 0.06 0.04 0.14 Diluted income per common share - operating $ 0.57 $ 0.58 $ 0.52 $ 0.53 $ 0.45 $ 1.67 $ 1.58 Book value per common share reconciliation Book value per common share (GAAP) $ 27.68 $ 27.18 $ 26.83 $ 26.52 $ 25.87 $ 27.68 $ 25.87 Effect of goodwill and other intangibles (8.02 ) (8.05 ) (8.12 ) (8.13 ) (8.17 ) (8.02 ) (8.17 ) Tangible book value per common share $ 19.66 $ 19.13 $ 18.71 $ 18.39 $ 17.70 $ 19.66 $ 17.70 Return on tangible common equity reconciliation Return on common equity (GAAP) 5.20 % 7.53 % 7.14 % 1.44 % 5.32 % 6.61 % 6.69 % Loss on sale of manufactured housing loans 2.43 — — — — 0.82 — Bond portfolio restructuring loss — — — 4.47 — — — Gain on lease termination — — (0.22 ) — — (0.07 ) — Loss on FinTrust (goodwill impairment) — 0.46 — — — 0.16 — FDIC special assessment — (0.07 ) 0.23 0.86 — 0.05 — Merger-related and other charges 0.19 0.20 0.19 0.50 0.82 0.19 0.66 Return on common equity - operating 7.82 8.12 7.34 7.27 6.14 7.76 7.35 Effect of goodwill and other intangibles 3.35 3.56 3.34 3.31 2.89 3.42 3.30 Return on tangible common equity - operating 11.17 % 11.68 % 10.68 % 10.58 % 9.03 % 11.18 % 10.65 % Return on assets reconciliation Return on assets (GAAP) 0.67 % 0.97 % 0.90 % 0.18 % 0.68 % 0.85 % 0.86 % Loss on sale of manufactured housing loans 0.31 — — — — 0.10 — Bond portfolio restructuring loss — — — 0.57 — — — Gain on lease termination — — (0.03 ) — — (0.01 ) — Loss on FinTrust (goodwill impairment) — 0.06 — — — 0.02 — FDIC special assessment — (0.01 ) 0.03 0.11 — 0.01 — Merger-related and other charges 0.03 0.02 0.03 0.06 0.11 0.02 0.09 Return on assets - operating 1.01 % 1.04 % 0.93 % 0.92 % 0.79 % 0.99 % 0.95 % Return on assets to return on assets- pre-tax pre-provision reconciliation Return on assets (GAAP) 0.67 % 0.97 % 0.90 % 0.18 % 0.68 % 0.85 % 0.86 % Income tax (benefit) expense 0.19 0.29 0.27 (0.04 ) 0.18 0.25 0.25 Provision for credit losses 0.21 0.18 0.19 0.21 0.45 0.19 0.38 Loss on sale of manufactured housing loans 0.40 — — — — 0.13 — Bond portfolio restructuring loss — — — 0.75 — — — Gain on lease termination — — (0.04 ) — — (0.01 ) — Loss on FinTrust (goodwill impairment) — 0.08 — — — 0.03 — FDIC special assessment — (0.01 ) 0.04 0.15 — 0.01 — Merger-related and other charges 0.03 0.03 0.04 0.08 0.13 0.03 0.11 Return on assets - pre-tax pre-provision - operating 1.50 % 1.54 % 1.40 % 1.33 % 1.44 % 1.48 % 1.60 % Efficiency ratio reconciliation Efficiency ratio (GAAP) 65.51 % 59.70 % 60.47 % 66.33 % 61.32 % 61.76 % 58.06 % Loss on sale of manufactured housing loans (7.15 ) — — — — (2.25 ) — Gain on lease termination — — 0.60 — — 0.21 — Loss on FinTrust (goodwill impairment) — (2.07 ) — — — (0.73 ) — FDIC special assessment — 0.31 (1.05 ) (4.29 ) — (0.24 ) — Merger-related and other charges (0.99 ) (0.88 ) (0.87 ) (2.47 ) (3.89 ) (0.91 ) (2.99 ) Efficiency ratio - operating 57.37 % 57.06 % 59.15 % 59.57 % 57.43 % 57.84 % 55.07 % Tangible common equity to tangible assets reconciliation Equity to total assets (GAAP) 12.45 % 12.35 % 12.06 % 11.95 % 11.85 % 12.45 % 11.85 % Effect of goodwill and other intangibles (3.20 ) (3.24 ) (3.25 ) (3.27 ) (3.33 ) (3.20 ) (3.33 ) Effect of preferred equity (0.32 ) (0.33 ) (0.32 ) (0.32 ) (0.34 ) (0.32 ) (0.34 ) Tangible common equity to tangible assets 8.93 % 8.78 % 8.49 % 8.36 % 8.18 % 8.93 % 8.18 %
UNITED COMMUNITY BANKS, INC. Loan Portfolio Composition at Period-End 2024 2023
Linked
Quarter
Change
Year over
Year
Change(in millions) Third
QuarterSecond
QuarterFirst
QuarterFourth
QuarterThird
QuarterLOANS BY CATEGORY Owner occupied commercial RE $ 3,323 $ 3,297 $ 3,310 $ 3,264 $ 3,279 $ 26 $ 44 Income producing commercial RE 4,259 4,058 4,206 4,264 4,130 201 129 Commercial & industrial 2,313 2,299 2,405 2,411 2,504 14 (191 ) Commercial construction 1,785 2,014 1,936 1,860 1,850 (229 ) (65 ) Equipment financing 1,603 1,581 1,544 1,541 1,534 22 69 Total commercial 13,283 13,249 13,401 13,340 13,297 34 (14 ) Residential mortgage 3,263 3,266 3,240 3,199 3,043 (3 ) 220 Home equity 1,015 985 969 959 941 30 74 Residential construction 189 211 257 302 399 (22 ) (210 ) Manufactured housing 2 321 328 336 343 (319 ) (341 ) Consumer 188 183 180 181 180 5 8 Other 24 (4 ) — 2 — 28 24 Total loans $ 17,964 $ 18,211 $ 18,375 $ 18,319 $ 18,203 $ (247 ) $ (239 ) LOANS BY MARKET Georgia $ 4,470 $ 4,411 $ 4,356 $ 4,357 $ 4,321 $ 59 $ 149 South Carolina 2,782 2,779 2,804 2,780 2,801 3 (19 ) North Carolina 2,586 2,591 2,566 2,492 2,445 (5 ) 141 Tennessee 1,848 2,144 2,209 2,244 2,314 (296 ) (466 ) Florida 2,423 2,407 2,443 2,442 2,318 16 105 Alabama 996 1,021 1,068 1,082 1,070 (25 ) (74 ) Commercial Banking Solutions 2,859 2,858 2,929 2,922 2,934 1 (75 ) Total loans $ 17,964 $ 18,211 $ 18,375 $ 18,319 $ 18,203 $ (247 ) $ (239 ) UNITED COMMUNITY BANKS, INC. Credit Quality (in thousands) 2024 Third
QuarterSecond
QuarterFirst
QuarterNONACCRUAL LOANS Owner occupied RE $ 7,783 $ 4,820 $ 2,310 Income producing RE 31,222 34,285 29,186 Commercial & industrial 28,856 17,335 20,134 Commercial construction 7,356 6,854 1,862 Equipment financing 9,123 8,341 8,829 Total commercial 84,340 71,635 62,321 Residential mortgage 21,851 18,473 16,569 Home equity 4,111 3,779 4,984 Residential construction 118 163 1,244 Manufactured housing 1,808 20,356 19,797 Consumer 152 72 54 Total nonaccrual loans 112,380 114,478 104,969 OREO and repossessed assets 2,580 2,244 2,261 Total NPAs $ 114,960 $ 116,722 $ 107,230 2024 Third Quarter Second Quarter First Quarter (in thousands) Net Charge-
OffsNet Charge-
Offs to
Average Loans(1)Net Charge-
OffsNet Charge-
Offs to
Average
Loans(1)Net Charge-
OffsNet Charge-
Offs to
Average
Loans(1)NET CHARGE-OFFS (RECOVERIES) BY CATEGORY Owner occupied RE $ (184 ) (0.02 )% $ 163 0.02 % $ 202 0.02 % Income producing RE 1,409 0.13 2,968 0.29 205 0.02 Commercial & industrial 4,577 0.79 1,281 0.22 3,906 0.65 Commercial construction 36 0.01 (48 ) (0.01 ) 20 — Equipment financing 5,268 1.32 5,502 1.42 6,362 1.66 Total commercial 11,106 0.33 9,866 0.30 10,695 0.32 Residential mortgage 32 — (107 ) (0.01 ) (16 ) — Home equity 36 0.01 (27 ) (0.01 ) (54 ) (0.02 ) Residential construction 111 0.22 26 0.04 119 0.17 Manufactured housing 11,556 28.51 1,150 1.43 1,569 1.90 Consumer 810 1.74 706 1.57 595 1.33 Total $ 23,651 0.52 $ 11,614 0.26 $ 12,908 0.28 (1)Annualized. UNITED COMMUNITY BANKS, INC. Consolidated Balance Sheets (Unaudited) (in thousands, except share and per share data) September 30,
2024December 31,
2023ASSETS Cash and due from banks $ 202,644 $ 200,781 Interest-bearing deposits in banks 537,395 803,094 Cash and cash equivalents 740,039 1,003,875 Debt securities available-for-sale 4,023,455 3,331,084 Debt securities held-to-maturity (fair value $2,060,729 and $2,095,620, respectively) 2,401,877 2,490,848 Loans held for sale 49,800 33,008 Loans and leases held for investment 17,964,099 18,318,755 Allowance for credit losses - loans and leases (205,290 ) (208,071 ) Loans and leases, net 17,758,809 18,110,684 Premises and equipment, net 396,696 378,421 Bank owned life insurance 345,703 345,371 Goodwill and other intangible assets, net 975,117 990,087 Other assets 681,636 613,873 Total assets $ 27,373,132 $ 27,297,251 LIABILITIES AND SHAREHOLDERS' EQUITY Liabilities: Deposits: Noninterest-bearing demand $ 6,222,518 $ 6,534,307 NOW and interest-bearing demand 5,951,900 6,155,193 Money market 6,301,956 5,600,587 Savings 1,113,168 1,207,807 Time 3,490,399 3,649,498 Brokered 173,161 163,219 Total deposits 23,253,102 23,310,611 Long-term debt 316,363 324,823 Accrued expenses and other liabilities 396,987 400,292 Total liabilities 23,966,452 24,035,726 Shareholders' equity: Preferred stock; $1 par value; 10,000,000 shares authorized; 3,662 shares Series I issued and
outstanding; $25,000 per share liquidation preference88,266 88,266 Common stock, $1 par value; 200,000,000 shares authorized,
119,282,762 and 119,010,319 shares issued and outstanding, respectively119,283 119,010 Common stock issuable; 588,296 and 620,108 shares, respectively 12,661 13,110 Capital surplus 2,707,266 2,699,112 Retained earnings 668,965 581,219 Accumulated other comprehensive loss (189,761 ) (239,192 ) Total shareholders' equity 3,406,680 3,261,525 Total liabilities and shareholders' equity $ 27,373,132 $ 27,297,251 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) 2024 2023 2024 2023 Interest revenue: Loans, including fees $ 291,574 $ 273,781 $ 867,152 $ 760,696 Investment securities, including tax exempt of $1,713, $1,722, $5,133 and $5,563, respectively 52,997 44,729 149,496 125,775 Deposits in banks and short-term investments 4,515 4,637 16,131 11,938 Total interest revenue 349,086 323,147 1,032,779 898,409 Interest expense: Deposits: NOW and interest-bearing demand 43,401 35,613 133,522 80,809 Money market 56,874 46,884 160,883 105,430 Savings 672 868 2,065 2,108 Time 35,202 33,368 107,925 75,464 Deposits 136,149 116,733 404,395 263,811 Short-term borrowings 27 189 87 3,186 Federal Home Loan Bank advances — — — 5,761 Long-term debt 3,724 3,669 11,262 11,339 Total interest expense 139,900 120,591 415,744 284,097 Net interest revenue 209,186 202,556 617,035 614,312 Provision for credit losses 14,428 30,268 39,562 74,804 Net interest revenue after provision for credit losses 194,758 172,288 577,473 539,508 Noninterest income: Service charges and fees 10,488 10,315 30,372 28,791 Mortgage loan gains and other related fees 3,520 6,159 17,830 17,264 Wealth management fees 6,338 6,451 19,037 17,775 Net (losses) gains from sales of other loans (25,700 ) 2,688 (22,867 ) 6,909 Lending and loan servicing fees 3,512 2,985 11,050 9,979 Securities losses, net — — — (1,644 ) Other 9,933 3,379 28,812 19,499 Total noninterest income 8,091 31,977 84,234 98,573 Total revenue 202,849 204,265 661,707 638,081 Noninterest expenses: Salaries and employee benefits 83,533 81,173 254,336 236,121 Communications and equipment 12,626 10,902 36,534 31,654 Occupancy 11,311 10,941 33,466 31,024 Advertising and public relations 2,041 2,251 6,401 6,914 Postage, printing and supplies 2,477 2,386 7,376 7,305 Professional fees 6,432 7,006 18,464 19,670 Lending and loan servicing expense 2,227 2,697 6,068 7,546 Outside services - electronic banking 4,433 2,561 10,163 8,646 FDIC assessments and other regulatory charges 5,003 4,314 17,036 12,457 Amortization of intangibles 3,528 4,171 11,209 11,120 Merger-related and other charges 2,176 9,168 6,420 21,444 Other 7,278 6,904 27,638 22,785 Total noninterest expenses 143,065 144,474 435,111 416,686 Income before income taxes 59,784 59,791 226,596 221,395 Income tax expense 12,437 11,925 50,003 47,941 Net income 47,347 47,866 176,593 173,454 Preferred stock dividends, net of discount on repurchases 1,573 832 4,719 4,270 Earnings allocated to participating securities 272 259 988 939 Net income available to common shareholders $ 45,502 $ 46,775 $ 170,886 $ 168,245 Net income per common share: Basic $ 0.38 $ 0.39 $ 1.43 $ 1.44 Diluted 0.38 0.39 1.43 1.44 Weighted average common shares outstanding: Basic 119,818 119,506 119,736 116,925 Diluted 119,952 119,624 119,827 117,084 UNITED COMMUNITY BANKS, INC. Average Consolidated Balance Sheets and Net Interest Analysis For the Three Months Ended September 30, 2024 2023 (dollars in thousands, fully taxable equivalent (FTE)) Average Balance Interest Average Rate Average Balance Interest Average Rate Assets: Interest-earning assets: Loans, net of unearned income (FTE)(1)(2) $ 18,051,741 $ 291,164 6.42 % $ 18,055,402 $ 273,800 6.02 % Taxable securities(3) 6,182,164 51,284 3.32 5,933,708 43,007 2.90 Tax-exempt securities (FTE)(1)(3) 361,359 2,292 2.54 368,148 2,313 2.51 Federal funds sold and other interest-earning assets 505,792 5,440 4.28 538,039 5,093 3.76 Total interest-earning assets (FTE) 25,101,056 350,180 5.55 24,895,297 324,213 5.17 Noninterest-earning assets: Allowance for credit losses (215,008 ) (209,472 ) Cash and due from banks 206,995 225,831 Premises and equipment 399,262 367,217 Other assets(3) 1,615,468 1,568,824 Total assets $ 27,107,773 $ 26,847,697 Liabilities and Shareholders' Equity: Interest-bearing liabilities: Interest-bearing deposits: NOW and interest-bearing demand $ 5,797,845 43,401 2.98 $ 5,285,513 35,613 2.67 Money market 6,342,455 56,874 3.57 5,622,355 46,884 3.31 Savings 1,126,774 672 0.24 1,301,047 868 0.26 Time 3,465,980 34,560 3.97 3,473,191 31,072 3.55 Brokered time deposits 50,364 642 5.07 209,119 2,296 4.36 Total interest-bearing deposits 16,783,418 136,149 3.23 15,891,225 116,733 2.91 Federal funds purchased and other borrowings 1,899 27 5.66 44,164 189 1.70 Federal Home Loan Bank advances 11 — — — — — Long-term debt 323,544 3,724 4.58 324,770 3,669 4.48 Total borrowed funds 325,454 3,751 4.59 368,934 3,858 4.15 Total interest-bearing liabilities 17,108,872 139,900 3.25 16,260,159 120,591 2.94 Noninterest-bearing liabilities: Noninterest-bearing deposits 6,239,926 6,916,272 Other liabilities 391,574 435,592 Total liabilities 23,740,372 23,612,023 Shareholders' equity 3,367,401 3,235,674 Total liabilities and shareholders' equity $ 27,107,773 $ 26,847,697 Net interest revenue (FTE) $ 210,280 $ 203,622 Net interest-rate spread (FTE) 2.30 % 2.23 % Net interest margin (FTE)(4) 3.33 % 3.24 % (1) Interest revenue on tax-exempt securities and loans includes a taxable-equivalent adjustment to reflect comparable interest on taxable securities and loans. The FTE adjustment totaled $1.09 million and $1.07 million, respectively, for the three months ended September 30, 2024 and 2023. The tax rate used to calculate the adjustment was 25% in 2024 and 26% in 2023, 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 AFS securities, including those related to the transfer from AFS to HTM, have been reclassified to other assets. Pretax unrealized losses of $295 million in 2024 and $430 million in 2023 are included in other assets for purposes of this presentation.
(4) Net interest margin is taxable equivalent net interest revenue divided by average interest-earning assets.UNITED COMMUNITY BANKS, INC. Average Consolidated Balance Sheets and Net Interest Analysis For the Nine Months Ended September 30, 2024 2023 (dollars in thousands, fully taxable equivalent (FTE)) Average Balance Interest Average Rate Average Balance Interest Average Rate Assets: Interest-earning assets: Loans, net of unearned income (FTE)(1)(2) $ 18,187,790 $ 866,502 6.36 % $ 17,377,210 $ 760,802 5.85 % Taxable securities(3) 5,988,368 144,363 3.21 5,982,615 120,212 2.68 Tax-exempt securities (FTE)(1)(3) 363,692 6,876 2.52 386,499 7,470 2.58 Federal funds sold and other interest-earning assets 559,786 18,256 4.36 490,703 13,103 3.57 Total interest-earning assets (FTE) 25,099,636 1,035,997 5.51 24,237,027 901,587 4.97 Non-interest-earning assets: Allowance for loan losses (214,372 ) (186,428 ) Cash and due from banks 210,982 249,411 Premises and equipment 392,561 347,514 Other assets(3) 1,613,118 1,518,503 Total assets $ 27,101,925 $ 26,166,027 Liabilities and Shareholders' Equity: Interest-bearing liabilities: Interest-bearing deposits: NOW and interest-bearing demand $ 5,913,566 133,522 3.02 $ 4,891,214 80,809 2.21 Money market 6,092,649 160,883 3.53 5,349,265 105,430 2.64 Savings 1,159,982 2,065 0.24 1,341,033 2,108 0.21 Time 3,535,343 106,199 4.01 2,936,873 65,856 3.00 Brokered time deposits 50,343 1,726 4.58 280,293 9,608 4.58 Total interest-bearing deposits 16,751,883 404,395 3.22 14,798,678 263,811 2.38 Federal funds purchased and other borrowings 2,001 87 5.81 98,884 3,186 4.31 Federal Home Loan Bank advances 5 — — 166,355 5,761 4.63 Long-term debt 324,414 11,262 4.64 324,737 11,339 4.67 Total borrowed funds 326,420 11,349 4.64 589,976 20,286 4.60 Total interest-bearing liabilities 17,078,303 415,744 3.25 15,388,654 284,097 2.47 Noninterest-bearing liabilities: Noninterest-bearing deposits 6,306,919 7,226,096 Other liabilities 394,323 393,048 Total liabilities 23,779,545 23,007,798 Shareholders' equity 3,322,380 3,158,229 Total liabilities and shareholders' equity $ 27,101,925 $ 26,166,027 Net interest revenue (FTE) $ 620,253 $ 617,490 Net interest-rate spread (FTE) 2.26 % 2.50 % Net interest margin (FTE)(4) 3.30 % 3.41 % (1) Interest revenue on tax-exempt securities and loans includes a taxable-equivalent adjustment to reflect comparable interest on taxable securities and loans. The FTE adjustment totaled $3.22 million and $3.18 million, respectively, for the nine months ended September 30, 2024 and 2023. The tax rate used to calculate the adjustment was 25% in 2024 and 26% in 2023, 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 AFS securities, including those related to the transfer from AFS to HTM, have been reclassified to other assets. Pretax unrealized losses of $320 million in 2024 and $413 million in 2023 are included in other assets for purposes of this presentation.
(4) Net interest margin is taxable equivalent net-interest revenue divided by average interest-earning assets.About United Community Banks, Inc.
United Community Banks, Inc. (NYSE: UCB) is the financial holding company for United Community, a top 100 U.S. financial institution that is committed to improving the financial health and well-being of its customers and the communities it serves. United Community provides a full range of banking, wealth management and mortgage services. As of September 30, 2024, United Community Banks, Inc. had $27.4 billion in assets, 202 offices across Alabama, Florida, Georgia, North Carolina, South Carolina, and Tennessee, as well as a national SBA lending franchise and a national equipment lending subsidiary. In 2024, United Community became a 10-time winner of J.D. Power’s award for the best customer satisfaction among consumer banks in the Southeast region and was recognized as the most trusted bank in the Southeast. In 2023, United was named by American Banker as one of the “Best Banks to Work For” for the seventh consecutive year and was recognized in the Greenwich Excellence and Best Brands Awards, receiving 15 awards that included national honors for overall satisfaction in small business banking and middle market banking. Forbes has also consistently listed United Community as one of the World’s Best Banks and one of America’s Best Banks. Additional information about United can be found at ucbi.com.Non-GAAP Financial Measures
This press release, including the accompanying financial statement tables, contains financial information determined by methods other than in accordance with generally accepted accounting principles, or GAAP. This financial information includes certain operating performance measures, which exclude merger-related and other charges that are not considered part of recurring operations, such as “noninterest income – operating”, “noninterest expense - operating”, “operating net income,” “pre-tax, pre-provision income,” “operating net income per diluted common share,” “operating earnings per share,” “tangible book value per common share,” “operating return on common equity,” “operating return on tangible common equity,” “operating return on assets,” “return on assets - pre-tax, pre-provision - operating,” “return on assets - pre-tax, pre-provision,” “operating efficiency ratio,” and “tangible common equity to tangible assets.” These non-GAAP measures are included because United believes they may provide useful supplemental information for evaluating United’s underlying performance trends. These measures should be viewed in addition to, and not as an alternative to or substitute for, measures determined in accordance with GAAP, and are not necessarily comparable to non-GAAP measures that may be presented by other companies. To the extent applicable, reconciliations of these non-GAAP measures to the most directly comparable measures as reported in accordance with GAAP are included with the accompanying financial statement tables.Caution About Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In general, forward-looking statements usually may be identified through use of words such as “may,” “believe,” “expect,” “anticipate,” “intend,” “will,” “should,” “plan,” “estimate,” “predict,” “continue” and “potential,” or the negative of these terms or other comparable terminology. Forward-looking statements are not historical facts and represent management’s beliefs, based upon information available at the time the statements are made, with regard to the matters addressed; they are not guarantees of future performance. Actual results may prove to be materially different from the results expressed or implied by the forward-looking statements. Forward-looking statements are subject to numerous assumptions, risks and uncertainties that change over time and could cause actual results or financial condition to differ materially from those expressed in or implied by such statements. Factors that could cause or contribute to such differences include, but are not limited to general competitive, economic, political and market conditions. Further information regarding additional factors which could affect the forward-looking statements contained in this press release can be found in the cautionary language included under the headings “Cautionary Note Regarding Forward-Looking Statements” and “Risk Factors” in United’s Annual Report on Form 10-K for the year ended December 31, 2023, and other documents subsequently filed by United with the United States Securities and Exchange Commission (“SEC”).Many of these factors are beyond United’s ability to control or predict. If one or more events related to these or other risks or uncertainties materialize, or if the underlying assumptions prove to be incorrect, actual results may differ materially from the forward-looking statements. Accordingly, shareholders and investors should not place undue reliance on any such forward-looking statements. Any forward-looking statement speaks only as of the date of this communication, and United undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. New risks and uncertainties may emerge from time to time, and it is not possible for United to predict their occurrence or how they will affect United.
United qualifies all forward-looking statements by these cautionary statements.
For more information:
Jefferson Harralson
Chief Financial Officer
(864) 240-6208
Jefferson_Harralson@ucbi.com
