From the Wires
United Community Banks, Inc. Reports Earnings of $9.3 Million for Fourth Quarter 2012
Jan. 24, 2013 05:30 AM
BLAIRSVILLE, GA -- (Marketwire) -- 01/24/13 -- United Community Banks, Inc. (NASDAQ: UCBI)
- Net income of $9.3 million, or 11 cents per share
- Loans up $37.2 million from third quarter, or 4 percent annualized
- Core transaction deposits up $75.2 million in fourth quarter, or 10 percent annualized
- Solid improvement in credit quality
United Community Banks, Inc. (NASDAQ: UCBI) today reported net income of $9.3 million, or 11 cents per share, for the fourth quarter of 2012, and net income of $37.9 million, or 44 cents per share, for the year. The results for the fourth quarter and year reflect modest loan growth, improved credit quality, strong core transaction deposit growth, an increase in fee revenue, and lower operating expenses compared with the same periods a year ago.
"We had another positive quarter and a very productive year in rebuilding our core earnings and positioning United for future growth," said Jimmy Tallent, president and chief executive officer. "In the fourth quarter we achieved meaningful improvement in every key measure of credit quality, and we continued to build strong momentum in growing new customer loan and deposit relationships."
Tallent continued, "We grew our loan portfolio by $37 million from the third quarter, for an annualized rate of 4 percent. That was no easy accomplishment in the current business environment. Additionally, our core transaction deposits increased by $75 million, or 10 percent annualized. At the same time we lowered nonperforming assets by 10 percent, to $128 million. This total includes our lowest level of foreclosed properties since 2007, at $18 million. Even more encouraging was the significant drop in net charge-offs to $14.5 million, the lowest level since the second quarter of 2008."
"This was a good way to end a successful year," Tallent stated. "During 2012, we achieved $65 million in net new loan growth and we increased core transaction deposits by $311 million or 11 percent. Continued growth in quality loan and deposit relationships remains a top priority."
The fourth quarter provision for loan losses was $14 million, equal to a year ago and down $1.5 million from the third quarter. Fourth quarter net charge-offs were $14.5 million compared to $20.6 million in the third quarter and $45.6 million in the fourth quarter of 2011.
"The inflow of nonperforming loans in the fourth quarter was $20 million, the lowest quarterly total since the beginning of the economic cycle," Tallent said. "We expect this trend will lead to lower quarterly charge-offs and loan loss provisions during 2013."
Taxable equivalent net interest revenue totaled $56.0 million, down $1.34 million from the third quarter of 2012 and down $3.02 million from the fourth quarter of 2011. "The decrease primarily reflects lower yields on our investment securities and loan portfolios, as well as the overlap of new senior debt issued at the beginning of the fourth quarter that was used to repay subordinated debt that matured late in the fourth quarter," said Tallent.
"The lower yield on our loan portfolio reflects ongoing pricing pressure on new and renewed loans," Tallent continued. "Our investment securities interest decline was due to reinvestment of cash flows at record low rates. We continue to look for reinvestment opportunities with a focus on floating-rate securities to alleviate market and duration risk. Floating-rate securities, which account for 38 percent of the total investment securities portfolio, improve our interest sensitivity position by reducing our exposure to rising interest rates," Tallent continued.
The taxable equivalent net interest margin was down 16 basis points from the third quarter and 7 basis points from a year ago to 3.44 percent. "Five of the 16 basis point linked-quarter margin decline was due to the overlap in the replacement of maturing subordinated debt," stated Tallent. "Another five basis points was due to the scheduled repricing of certain corporate bonds from a fixed to floating rate. These floating rate securities were part of a planned strategy to maintain a neutral to slightly asset-sensitive interest rate position. The balance of the decrease was due to a new loan product offering with a low introductory rate that will reprice in 2013 and continued loan pricing pressures."
Fee revenue was $14.8 million for the fourth quarter, compared to $13.8 million for the third quarter and $12.7 million a year ago. The increase from prior quarters was primarily due to the higher level of mortgage loans closed and related fees. Mortgage refinancing activity continued at a strong pace through the fourth quarter as mortgage rates remained at record low levels. Closed mortgage loans totaled $100 million in the fourth quarter compared with $108 million in the third quarter and $78.8 million in the fourth quarter of 2011. Service charges and fees on deposit accounts were also up from a year ago due to new fees on low balance deposit accounts that became effective in the first quarter of 2012, and to higher debit card interchange fees.
Other fee revenue was down $217,000 from the third quarter of 2012 and $466,000 from the fourth quarter of 2011 to $2.34 million. The decrease was primarily due to lower hedge ineffectiveness gains and to a fourth quarter 2011 gain of $728,000 from the sale of state low-income housing tax credits.
Operating expenses, excluding foreclosed property costs, were $42.1 million for the fourth quarter of 2012 compared to $41.1 million for the third quarter and $41.8 million a year ago. The increase from a year ago was due primarily to a $2.24 million, one-time credit adjustment in the fourth quarter of 2011 related to our retirement plan that reduced salary and employee benefit expense in that period. Excluding the foreclosed property costs and the one-time credit adjustment, quarterly operating expenses were down $1.9 million from a year ago. Reduced staff levels and related costs were the primary drivers of the decrease. United had 164 fewer staff positions in the fourth quarter of 2012 compared to the fourth quarter of 2011.
Foreclosed property costs for the fourth quarter of 2012 were $4.6 million, compared to $3.7 million in the third quarter and $9.3 million a year ago. Fourth quarter 2012 costs included $1.4 million for maintenance and $3.2 million in net losses and write-downs. For the third quarter of 2012, foreclosed property costs included $962,000 in maintenance and $2.7 million in net losses and write-downs. Fourth quarter 2011 foreclosed property costs included $2.4 million in maintenance and $6.9 million in net losses and write-downs.
As of December 31, 2012, capital ratios were as follows: Tier 1 Risk-Based of 14.2 percent; Tier 1 Leverage of 9.7 percent; Total Risk-Based of 15.8 percent; Tier 1 Common Risk-Based of 8.9 percent; and, Tangible Equity-to-Assets of 8.6 percent.
"By every measure, 2012 has been a year of significant improvement for United Community Banks," Tallent said. "Reflecting on all that this banking team has accomplished in restoring credit quality, regaining momentum in new business growth, and improving operating efficiency, I cannot help but look forward with excitement.
"We know that challenges remain as the economy continues to be sluggish and rates are at record lows," Tallent continued. "At the same time we expect credit measures to continue to improve, and this will translate into lower levels of charge-offs and provisioning. We see opportunities to grow our mortgage and advisory services businesses, and will look to expand both. We believe we can grow our loan portfolio and we will accomplish this by continuing to add lenders in key markets, as well as expanding into new markets, like Greenville, South Carolina, where we recently opened a loan production office."
Tallent concluded, "We constantly evaluate and find ways to improve this company -- to make it more productive and efficient while continuing to deliver the best customer service in the industry. Ultimately we are committed to delivering superior financial results on behalf of our shareholders. We are committed, we are up to the challenge, and we look ahead with determination and optimism."
Conference Call
United will hold a conference call today, Thursday, January 24, 2013, at 11 a.m. ET to discuss the contents of this news release and to share business highlights for the quarter. To access the call, dial (877) 380-5665 and use the conference number 86024021. The conference call also will be webcast and can be accessed by selecting 'Calendar of Events' within the Investor Relations section of United's website at www.ucbi.com.
About United Community Banks, Inc.
Headquartered in Blairsville, United Community Banks, Inc. is the third-largest bank holding company in Georgia. United has assets of $6.8 billion and operates 105 banking offices throughout north Georgia, the Atlanta region, coastal Georgia, western North Carolina, east Tennessee and northwest South Carolina. United specializes in providing personalized community banking services to individuals and small to mid-size businesses and also offers the convenience of 24-hour access through a network of ATMs, telephone and on-line banking. United's common stock is listed on the Nasdaq Global Select Market under the symbol UCBI. Additional information may be found at United's website at www.ucbi.com.
Safe Harbor
This news release contains forward-looking statements, as defined by federal securities laws, including statements about United's financial outlook and business environment. These statements are based on current expectations and are provided to assist in the understanding of future financial performance. Such performance involves risks and uncertainties that may cause actual results to differ materially from those expressed or implied in any such statements. For a discussion of some of the risks and other factors that may cause such forward-looking statements to differ materially from actual results, please refer to United's filings with the Securities and Exchange Commission including its 2011 Annual Report on Form 10-K under the sections entitled "Forward-Looking Statements" and "Risk Factors." Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update or revise forward-looking statements.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Selected Financial Information
-------------------------------------- --------
2012 2011
-------------------------------------- --------
(in thousands, except per
share data; taxable data; Fourth Third Second First Fourth
taxable equivalent) Quarter Quarter Quarter Quarter Quarter
-------- -------- -------- -------- --------
INCOME SUMMARY
Interest revenue $ 64,450 $ 65,978 $ 66,780 $ 70,221 $ 71,905
Interest expense 8,422 8,607 9,944 11,357 12,855
-------- -------- -------- -------- --------
Net interest revenue 56,028 57,371 56,836 58,864 59,050
Provision for loan losses 14,000 15,500 18,000 15,000 14,000
Fee revenue 14,761 13,764 12,867 15,379 12,667
-------- -------- -------- -------- --------
Total revenue 56,789 55,635 51,703 59,243 57,717
Operating expenses 46,726 44,783 44,310 46,955 51,080
-------- -------- -------- -------- --------
Income (loss) before
income taxes 10,063 10,852 7,393 12,288 6,637
Income tax expense
(benefit) 802 284 894 760 (3,264)
-------- -------- -------- -------- --------
Net income (loss) 9,261 10,568 6,499 11,528 9,901
Preferred dividends and
discount accretion 3,045 3,041 3,032 3,030 3,025
-------- -------- -------- -------- --------
Net income (loss)
available to common
shareholders $ 6,216 $ 7,527 $ 3,467 $ 8,498 $ 6,876
======== ======== ======== ======== ========
PERFORMANCE MEASURES
Per common share:
Diluted income (loss) $ .11 $ .13 $ .06 $ .15 $ .12
Book value 6.74 6.75 6.61 6.68 6.62
Tangible book value
(2) 6.64 6.64 6.48 6.54 6.47
Key performance ratios:
Return on equity
(1)(3) 6.03% 7.43% 3.51% 8.78% 7.40%
Return on assets (3) .54 .63 .37 .66 .56
Net interest margin
(3) 3.44 3.60 3.43 3.53 3.51
Efficiency ratio 66.04 62.95 63.84 63.31 71.23
Equity to assets 8.63 8.75 8.33 8.19 8.28
Tangible equity to
assets (2) 8.55 8.66 8.24 8.08 8.16
Tangible common equity
to assets (2) 5.67 5.73 5.45 5.33 5.38
Tangible common equity
to risk- weighted
assets (2) 8.33 8.44 8.37 8.21 8.25
ASSET QUALITY *
Non-performing loans $109,894 $115,001 $115,340 $129,704 $127,479
Foreclosed properties 18,264 26,958 30,421 31,887 32,859
-------- -------- -------- -------- --------
Total non-performing
assets (NPAs) 128,158 141,959 145,761 161,591 160,338
Allowance for loan
losses 107,137 107,642 112,705 113,601 114,468
Net charge-offs 14,505 20,563 18,896 15,867 45,624
Allowance for loan
losses to loans 2.57% 2.60% 2.74% 2.75% 2.79%
Net charge-offs to
average loans (3) 1.39 1.99 1.85 1.55 4.39
NPAs to loans and
foreclosed properties 3.06 3.41 3.51 3.88 3.87
NPAs to total assets 1.88 2.12 2.16 2.25 2.30
AVERAGE BALANCES($ in
millions)
Loans $ 4,191 $ 4,147 $ 4,156 $ 4,168 $ 4,175
Investment securities 2,088 1,971 2,145 2,153 2,141
Earning assets 6,482 6,346 6,665 6,700 6,688
Total assets 6,778 6,648 6,993 7,045 7,019
Deposits 5,873 5,789 5,853 6,028 6,115
Shareholders' equity 585 582 583 577 581
Common shares - basic
(thousands) 57,971 57,880 57,840 57,764 57,646
Common shares - diluted
(thousands) 57,971 57,880 57,840 57,764 57,646
AT PERIOD END($ in
millions)
Loans * $ 4,175 $ 4,138 $ 4,119 $ 4,128 $ 4,110
Investment securities 2,079 2,025 1,984 2,202 2,120
Total assets 6,802 6,699 6,737 7,174 6,983
Deposits 5,952 5,823 5,822 6,001 6,098
Shareholders' equity 585 585 576 580 575
Common shares
outstanding (thousands) 57,741 57,710 57,641 57,603 57,561
(1) Net loss available to common shareholders, which is net of preferred
stock dividends, divided by average realized common equity, which excludes
accumulated other comprehensive income (loss). (2) Excludes effect of
acquisition related intangibles and associated amortization. (3)
Annualized.
* Excludes loans and foreclosed properties covered by loss sharing
agreements with the FDIC.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Selected Financial Information
--------------------------------------------------------
Fourth
(in thousands, 2012 2011 Quarter For the Twelve YTD
except per share -------- -------- 2012- Months Ended 2012-
data; taxable Fourth Fourth 2011 ------------------ 2011
equivalent) Quarter Quarter Change 2012 2011 Change
-------- -------- ------- -------- --------- -------
INCOME SUMMARY
Interest revenue $ 64,450 $ 71,905 $267,429 $ 299,344
Interest expense 8,422 12,855 38,330 65,675
-------- -------- -------- ---------
Net interest
revenue 56,028 59,050 (5)% 229,099 233,669 (2)%
Provision for
loan losses 14,000 14,000 62,500 251,000
Fee revenue 14,761 12,667 17 56,771 49,908 14
-------- -------- -------- ---------
Total revenue 56,789 57,717 223,370 32,577
Operating
expenses 46,726 51,080 (9) 182,774 261,599 (30)
-------- -------- -------- ---------
Income (loss)
before
income taxes 10,063 6,637 52 40,596 (229,022)
Income tax
expense
(benefit) 802 (3,264) 2,740 (2,276)
-------- -------- -------- ---------
Net income
(loss) 9,261 9,901 (6) 37,856 (226,746)
Preferred
dividends and
discount
accretion 3,045 3,025 12,148 11,838
-------- -------- -------- ---------
Net income (loss)
available to
common
shareholders $ 6,216 $ 6,876 (10) $ 25,708 $(238,584)
======== ======== ======== =========
PERFORMANCE
MEASURES
Per common
share:
Diluted
income
(loss) $ .11 $ .12 (8) $ .44 $ (5.97)
Book value 6.74 6.62 2 6.74 6.62 2
Tangible book
value (2) 6.64 6.47 3 6.64 6.47 3
Key performance
ratios:
Return on
equity
(1)(3) 6.03% 7.40% 6.43% (93.57)%
Return on
assets (3) .54 .56 .55 (3.15)
Net interest
margin (3) 3.44 3.51 3.50 3.44
Efficiency
ratio 66.04 71.23 64.02 92.27
Equity to
assets 8.63 8.28 8.47 7.75
Tangible
equity to
assets (2) 8.55 8.16 8.38 7.62
Tangible
common
equity to
assets (2) 5.67 5.38 5.54 3.74
Tangible
common
equity to
risk-
weighted
assets (2) 8.33 8.25 8.33 8.25
ASSET QUALITY *
Non-performing
loans $109,894 $127,479 $109,894 $ 127,479
Foreclosed
properties 18,264 32,859 18,264 32,859
-------- -------- -------- ---------
Total non-
performing
assets
(NPAs) 128,158 160,338 128,158 160,338
Allowance for
loan losses 107,137 114,468 107,137 114,468
Net charge-offs 14,505 45,624 69,831 311,227
Allowance for
loan losses to
loans 2.57% 2.79% 2.57% 2.79%
Net charge-offs
to average
loans (3) 1.39 4.39 1.69 7.33
NPAs to loans
and foreclosed
properties 3.06 3.87 3.06 3.87
NPAs to total
assets 1.88 2.30 1.88 2.30
AVERAGE BALANCES
($ in millions)
Loans $ 4,191 $ 4,175 - $ 4,166 $ 4,307 (3)
Investment
securities 2,088 2,141 (2) 2,089 1,999 5
Earning assets 6,482 6,688 (3) 6,547 6,785 (4)
Total assets 6,778 7,019 (3) 6,865 7,189 (5)
Deposits 5,873 6,115 (4) 5,885 6,275 (6)
Shareholders'
equity 585 581 1 582 557 4
Common shares -
basic
(thousands) 57,971 57,646 57,857 39,943
Common shares -
diluted
(thousands) 57,971 57,646 57,857 39,943
AT PERIOD END ($
in millions)
Loans * $ 4,175 $ 4,110 2 $ 4,175 $ 4,110 2
Investment
securities 2,079 2,120 (2) 2,079 2,120 (2)
Total assets 6,802 6,983 (3) 6,802 6,983 (3)
Deposits 5,952 6,098 (2) 5,952 6,098 (2)
Shareholders'
equity 585 575 2 585 575 2
Common shares
outstanding
(thousands) 57,741 57,561 57,741 57,561
(1) Net loss available to common shareholders, which is net of preferred
stock dividends, divided by average realized common equity, which excludes
accumulated other comprehensive income (loss). (2) Excludes effect of
acquisition related intangibles and associated amortization. (3)
Annualized.
* Excludes loans and foreclosed properties covered by loss sharing
agreements with the FDIC.
UNITED COMMUNITY BANKS, INC.
Selected Financial Information
For the Years Ended December 31,
---------------------------------------------------------------------------
(in thousands, except
per share data;
taxable equivalent) 2012 2011 2010 2009 2008
--------- --------- --------- --------- ---------
INCOME SUMMARY
Net interest revenue $ 229,099 $ 233,669 $ 243,052 $ 245,227 $ 238,704
Operating provision
for loan losses (1) 62,500 251,000 234,750 310,000 184,000
Operating fee revenue
(2) 56,771 49,908 48,548 50,964 46,081
--------- --------- --------- --------- ---------
Total operating
revenue (1)(2) 223,370 32,577 56,850 (13,809) 100,785
Operating expenses
(3) 182,774 261,599 242,952 217,050 200,335
Loss on sale of
nonperforming assets - - 45,349 - -
--------- --------- --------- --------- ---------
Operating income
(loss) from
continuing
operations
before taxes 40,596 (229,022) (231,451) (230,859) (99,550)
Operating income
taxes 2,740 (2,276) 73,218 (91,754) (35,651)
--------- --------- --------- --------- ---------
Net operating
income (loss)
from continuing
operations 37,856 (226,746) (304,669) (139,105) (63,899)
Gain from
acquisition, net of
tax - - - 7,062 -
Noncash goodwill
impairment charges - - (210,590) (95,000) -
Severance cost, net
of tax benefit - - - (1,797) -
Fraud loss provision
and subsequent
recovery, net of tax
benefit - - 11,750 - -
Net income (loss)
from discontinued
operations - - (101) 513 449
Gain from sale of
subsidiary, net of
income taxes and
selling costs - - 1,266 - -
--------- --------- --------- --------- ---------
Net income (loss) 37,856 (226,746) (502,344) (228,327) (63,450)
Preferred dividends
and discount
accretion 12,148 11,838 10,316 10,242 724
--------- --------- --------- --------- ---------
Net income (loss)
available to
common
shareholders $ 25,708 $(238,584) $(512,660) $(238,569) $ (64,174)
========= ========= ========= ========= =========
PERFORMANCE MEASURES
Per common share:
Diluted operating
earnings (loss)
from continuing
operations
(1)(2)(3) $ .44 $ (5.97) $ (16.64) $ (12.37) $ (6.82)
Diluted earnings
(loss) from
continuing
operations .44 (5.97) (27.15) (19.80) (6.82)
Diluted earnings
(loss) .44 (5.97) (27.09) (19.76) (6.77)
Cash dividends
declared
(rounded) - - - - .87
Stock dividends 3 for 2 for
declared (6) - - - 130 130
Book value 6.74 6.62 15.40 41.78 84.75
Tangible book
value (5) 6.64 6.47 14.80 30.09 51.93
Key performance
ratios:
Return on equity
(4) 6.43 (93.57)% (85.08)% (34.40)% (7.82)%
Return on assets .55 (3.15) (6.61) (2.76) (.76)
Net interest
margin 3.50 3.44 3.56 3.29 3.18
Operating
efficiency ratio
from continuing
operations
(2)(3) 64.02 92.27 98.98 73.97 70.00
Equity to assets 8.47 7.75 10.77 11.12 10.22
Tangible equity
to assets (5) 8.38 7.62 8.88 8.33 6.67
Tangible common
equity to assets
(5) 5.54 3.74 6.52 6.15 6.57
Tangible common
equity to risk-
weighted assets
(5) 8.33 8.25 5.64 10.39 8.34
ASSET QUALITY *
Non-performing
loans $ 109,894 $ 127,479 $ 179,094 $ 264,092 $ 190,723
Foreclosed
properties 18,264 32,859 142,208 120,770 59,768
--------- --------- --------- --------- ---------
Total non-
performing
assets (NPAs) 128,158 160,338 321,302 384,862 250,491
Allowance for loan
losses 107,137 114,468 174,695 155,602 122,271
Operating net
charge-offs (1) 69,831 311,227 215,657 276,669 151,152
Allowance for loan
losses to loans 2.57% 2.79% 3.79% 3.02% 2.14%
Operating net
charge-offs to
average loans (1) 1.69 7.33 4.42 5.03 2.57
NPAs to loans and
foreclosed
properties 3.06 3.87 6.77 7.30 4.35
NPAs to total
assets 1.88 2.30 4.42 4.81 2.92
AVERAGE BALANCES ($
in millions)
Loans $ 4,166 $ 4,307 $ 4,961 $ 5,548 $ 5,891
Investment
securities 2,089 1,999 1,453 1,656 1,489
Earning assets 6,547 6,785 6,822 7,465 7,504
Total assets 6,865 7,189 7,605 8,269 8,319
Deposits 5,885 6,275 6,373 6,713 6,524
Shareholders'
equity 582 557 819 920 850
Common shares -
Basic (thousands) 57,857 39,943 18,925 12,075 9,474
Common shares -
Diluted
(thousands) 57,857 39,943 18,925 12,075 9,474
AT YEAR END ($ in
millions)
Loans * $ 4,175 $ 4,110 $ 4,604 $ 5,151 $ 5,705
Investment
securities 2,079 2,120 1,490 1,530 1,617
Total assets 6,802 6,983 7,276 8,000 8,592
Deposits 5,952 6,098 6,469 6,628 7,004
Shareholders'
equity 585 575 469 962 989
Common shares
outstanding
(thousands) 57,741 57,561 18,937 18,809 9,602
(1) Excludes the subsequent recovery of $11.8 million in previously
recognized fraud related loan losses in 2010. (2) Excludes the gain from
acquisition of $11.4 million, net of income tax expense of $4.3 million in
2009. (3) Excludes goodwill impairment charges of $211 million and $95
million in 2010 and 2009, respectively, and severance costs of $2.9
million, net of income tax benefit of $1.1 million in 2009. (4) Net income
(loss) available to common shareholders, which is net of preferred stock
dividends, divided by average realized common equity, which excludes
accumulated other comprehensive income (loss). (5) Excludes effect of
acquisition related intangibles and associated amortization. (6) Number of
new shares issued for shares currently held.
* Excludes loans and foreclosed properties covered by loss sharing
agreements with the FDIC.
UNITED COMMUNITY BANKS, INC.
Non-GAAP Performance Measures Reconciliation
Selected Financial Information
-------------------------------------------
2012 2011
---------------------------------- -------
(in thousands, except per share Fourth Third Second First Fourth
data; taxable equivalent) Quarter Quarter Quarter Quarter Quarter
------- ------- ------- ------- -------
Interest revenue reconciliation
Interest revenue - taxable
equivalent $64,450 $65,978 $66,780 $70,221 $71,905
Taxable equivalent adjustment (381) (419) (444) (446) (423)
------- ------- ------- ------- -------
Interest revenue (GAAP) $64,069 $65,559 $66,336 $69,775 $71,482
======= ======= ======= ======= =======
Net interest revenue
reconciliation
Net interest revenue - taxable
equivalent $56,028 $57,371 $56,836 $58,864 $59,050
Taxable equivalent adjustment (381) (419) (444) (446) (423)
------- ------- ------- ------- -------
Net interest revenue (GAAP) $55,647 $56,952 $56,392 $58,418 $58,627
======= ======= ======= ======= =======
Provision for loan losses
reconciliation
Operating provision for loan
losses $14,000 $15,500 $18,000 $15,000 $14,000
Partial recovery of special
fraud-related loan loss - - - - -
------- ------- ------- ------- -------
Provision for loan losses
(GAAP) $14,000 $15,500 $18,000 $15,000 $14,000
======= ======= ======= ======= =======
Fee revenue reconciliation
Operating fee revenue $14,761 $13,764 $12,867 $15,379 $12,667
Gain from acquisition - - - - -
------- ------- ------- ------- -------
Fee revenue (GAAP) $14,761 $13,764 $12,867 $15,379 $12,667
======= ======= ======= ======= =======
Total revenue reconciliation
Total operating revenue $56,789 $55,635 $51,703 $59,243 $57,717
Taxable equivalent adjustment (381) (419) (444) (446) (423)
Gain from acquisition - - - - -
Partial recovery of special
fraud-related loan loss - - - - -
------- ------- ------- ------- -------
Total revenue (GAAP) $56,408 $55,216 $51,259 $58,797 $57,294
======= ======= ======= ======= =======
Expense reconciliation
Operating expense $46,726 $44,783 $44,310 $46,955 $51,080
Noncash goodwill impairment
charge - - - - -
Severance costs - - - - -
------- ------- ------- ------- -------
Operating expense (GAAP) $46,726 $44,783 $44,310 $46,955 $51,080
======= ======= ======= ======= =======
Income (loss) before taxes
reconciliation
Income (loss) before taxes $10,063 $10,852 $ 7,393 $12,288 $ 6,637
Taxable equivalent adjustment (381) (419) (444) (446) (423)
Gain from acquisition - - - - -
Noncash goodwill impairment
charge - - - - -
Severance costs - - - - -
Partial recovery of special
fraud-related loan loss - - - - -
------- ------- ------- ------- -------
Income (loss) before taxes
(GAAP) $ 9,682 $10,433 $ 6,949 $11,842 $ 6,214
======= ======= ======= ======= =======
Income tax (benefit) expense
reconciliation
Income tax (benefit) expense $ 802 $ 284 $ 894 $ 760 $(3,264)
Taxable equivalent adjustment (381) (419) (444) (446) (423)
Gain from acquisition, tax
expense - - - - -
Severance costs, tax benefit - - - - -
------- ------- ------- ------- -------
Income tax (benefit) expense
(GAAP) $ 421 $ (135) $ 450 $ 314 $(3,687)
======= ======= ======= ======= =======
Diluted earnings (loss) from
continuing operations per
common share reconciliation
Diluted operating earnings
(loss) from continuing
operations per common share $ .11 $ .13 $ .06 $ .15 $ .12
Gain from acquisition - - - - -
Noncash goodwill impairment
charge - - - - -
Severance costs - - - - -
Partial recovery of special
fraud-related loan loss - - - - -
------- ------- ------- ------- -------
Diluted earnings (loss) from
continuing operations per
common share (GAAP) $ .11 $ .13 $ .06 $ .15 $ .12
======= ======= ======= ======= =======
Book value per common share
reconciliation
Tangible book value per common
share $ 6.64 $ 6.64 $ 6.48 $ 6.54 $ 6.47
Effect of goodwill and other
intangibles .10 .11 .13 .14 .15
------- ------- ------- ------- -------
Book value per common share
(GAAP) $ 6.74 $ 6.75 $ 6.61 $ 6.68 $ 6.62
======= ======= ======= ======= =======
Efficiency ratio from
continuing operations
reconciliation
Operating efficiency ratio from
continuing operations 66.04% 62.95% 63.84% 63.31% 71.23%
Gain from acquisition - - - - -
Noncash goodwill impairment
charge - - - - -
Severance costs - - - - -
------- ------- ------- ------- -------
Efficiency ratio from
continuing operations (GAAP) 66.04% 62.95% 63.84% 63.31% 71.23%
======= ======= ======= ======= =======
Average equity to assets
reconciliation
Tangible common equity to
assets 5.67% 5.73% 5.45% 5.33% 5.38%
Effect of preferred equity 2.88 2.93 2.79 2.75 2.78
------- ------- ------- ------- -------
Tangible equity to assets 8.55 8.66 8.24 8.08 8.16
Effect of goodwill and other
intangibles .08 .09 .09 .11 .12
------- ------- ------- ------- -------
Equity to assets (GAAP) 8.63% 8.75% 8.33% 8.19% 8.28%
======= ======= ======= ======= =======
Tangible common equity to risk-
weighted assets reconciliation
Tangible common equity to risk-
weighted assets 8.33% 8.44% 8.37% 8.21% 8.25%
Effect of other comprehensive
income .51 .36 .28 .10 (.03)
Effect of deferred tax
limitation - - - - -
Effect of trust preferred 1.15 1.17 1.19 1.15 1.18
Effect of preferred equity 4.24 4.29 4.35 4.23 4.29
------- ------- ------- ------- -------
Tier I capital ratio
(Regulatory) 14.23% 14.26% 14.19% 13.69% 13.69%
======= ======= ======= ======= =======
Net charge-offs reconciliation
Operating net charge-offs $14,505 $20,563 $18,896 $15,867 $45,624
Subsequent partial recovery of
fraud-related charge-off - - - - -
------- ------- ------- ------- -------
Net charge-offs (GAAP) $14,505 $20,563 $18,896 $15,867 $45,624
======= ======= ======= ======= =======
Net charge-offs to average
loans reconciliation
Operating net charge-offs to
average loans 1.39% 1.99% 1.85% 1.55% 4.39%
Subsequent partial recovery of
fraud-related charge-off - - - - -
------- ------- ------- ------- -------
Net charge-offs to average
loans (GAAP) 1.39% 1.99% 1.85% 1.55% 4.39%
======= ======= ======= ======= =======
UNITED COMMUNITY BANKS, INC.
Non-GAAP Performance Measures Reconciliation
Selected Financial Information
-----------------------------------------------------
(in thousands, except For the Twelve
per share Months Ended
data; taxable -----------------------------------------------------
equivalent) 2012 2011 2010 2009 2008
--------- --------- --------- --------- ---------
Interest revenue
reconciliation
Interest revenue -
taxable equivalent $ 267,429 $ 299,344 $ 343,123 $ 404,961 $ 466,969
Taxable equivalent
adjustment (1,690) (1,707) (2,001) (2,132) (2,261)
--------- --------- --------- --------- ---------
Interest revenue
(GAAP) $ 265,739 $ 297,637 $ 341,122 $ 402,829 $ 464,708
========= ========= ========= ========= =========
Net interest revenue
reconciliation
Net interest revenue
- taxable equivalent $ 229,099 $ 233,669 $ 243,052 $ 245,227 $ 238,704
Taxable equivalent
adjustment (1,690) (1,707) (2,001) (2,132) (2,261)
--------- --------- --------- --------- ---------
Net interest
revenue (GAAP) $ 227,409 $ 231,962 $ 241,051 $ 243,095 $ 236,443
========= ========= ========= ========= =========
Provision for loan
losses
reconciliation
Operating provision
for loan losses $ 62,500 $ 251,000 $ 234,750 $ 310,000 $ 184,000
Partial recovery of
special fraud-
related loan loss - - (11,750) - -
--------- --------- --------- --------- ---------
Provision for loan
losses (GAAP) $ 62,500 $ 251,000 $ 223,000 $ 310,000 $ 184,000
========= ========= ========= ========= =========
Fee revenue
reconciliation
Operating fee revenue $ 56,771 $ 49,908 $ 48,548 $ 50,964 $ 46,081
Gain from acquisition - - - 11,390 -
--------- --------- --------- --------- ---------
Fee revenue (GAAP) $ 56,771 $ 49,908 $ 48,548 $ 62,354 $ 46,081
========= ========= ========= ========= =========
Total revenue
reconciliation
Total operating
revenue $ 223,370 $ 32,577 $ 56,850 $ (13,809) $ 100,785
Taxable equivalent
adjustment (1,690) (1,707) (2,001) (2,132) (2,261)
Gain from acquisition - - - 11,390 -
Partial recovery of
special fraud-
related loan loss - - 11,750 - -
--------- --------- --------- --------- ---------
Total revenue
(GAAP) $ 221,680 $ 30,870 $ 66,599 $ (4,551) $ 98,524
========= ========= ========= ========= =========
Expense
reconciliation
Operating expense $ 182,774 $ 261,599 $ 288,301 $ 217,050 $ 200,335
Noncash goodwill
impairment charge - - 210,590 95,000 -
Severance costs - - - 2,898 -
--------- --------- --------- --------- ---------
Operating expense
(GAAP) $ 182,774 $ 261,599 $ 498,891 $ 314,948 $ 200,335
========= ========= ========= ========= =========
Income (loss) before
taxes reconciliation
Income (loss) before
taxes $ 40,596 $(229,022) $(231,451) $(230,859) $ (99,550)
Taxable equivalent
adjustment (1,690) (1,707) (2,001) (2,132) (2,261)
Gain from acquisition - - - 11,390 -
Noncash goodwill
impairment charge - - (210,590) (95,000) -
Severance costs - - - (2,898) -
Partial recovery of
special fraud-
related loan loss - - 11,750 - -
--------- --------- --------- --------- ---------
Income (loss)
before taxes
(GAAP) $ 38,906 $(230,729) $(432,292) $(319,499) $(101,811)
========= ========= ========= ========= =========
Income tax (benefit)
expense
reconciliation
Income tax (benefit)
expense $ 2,740 $ (2,276) $ 73,218 $ (91,754) $ (35,651)
Taxable equivalent
adjustment (1,690) (1,707) (2,001) (2,132) (2,261)
Gain from
acquisition, tax
expense - - - 4,328 -
Severance costs, tax
benefit - - - (1,101) -
--------- --------- --------- --------- ---------
Income tax
(benefit) expense
(GAAP) $ 1,050 $ (3,983) $ 71,217 $ (90,659) $ (37,912)
========= ========= ========= ========= =========
Diluted earnings
(loss) from
continuing
operations per
common share
reconciliation
Diluted operating
earnings (loss) from
continuing
operations per
common share $ .44 $ (5.97) $ (16.64) $ (12.37) $ (6.82)
Gain from acquisition - - - .58 -
Noncash goodwill
impairment charge - - (11.13) (7.86) -
Severance costs - - - (.15) -
Partial recovery of
special fraud-
related loan loss - - .62 - -
--------- --------- --------- --------- ---------
Diluted earnings
(loss) from
continuing
operations per
common share
(GAAP) $ .44 $ (5.97) $ (27.15) $ (19.80) $ (6.82)
========= ========= ========= ========= =========
Book value per common
share reconciliation
Tangible book value
per common share $ 6.64 $ 6.47 $ 14.80 $ 30.09 $ 51.93
Effect of goodwill
and other
intangibles .10 .15 .60 11.69 32.82
--------- --------- --------- --------- ---------
Book value per
common share
(GAAP) $ 6.74 $ 6.62 $ 15.40 $ 41.78 $ 84.75
========= ========= ========= ========= =========
Efficiency ratio from
continuing
operations
reconciliation
Operating efficiency
ratio from
continuing
operations 64.02% 92.27% 98.98% 73.97% 70.00%
Gain from acquisition - - - (2.77) -
Noncash goodwill
impairment charge - - 72.29 31.17 -
Severance costs - - - .95 -
--------- --------- --------- --------- ---------
Efficiency ratio
from continuing
operations (GAAP) 64.02% 92.27% 171.27% 103.32% 70.00%
========= ========= ========= ========= =========
Average equity to
assets
reconciliation
Tangible common
equity to assets 5.54% 3.74% 6.52% 6.15% 6.57%
Effect of preferred
equity 2.84 3.88 2.36 2.18 .10
--------- --------- --------- --------- ---------
Tangible equity to
assets 8.38 7.62 8.88 8.33 6.67
Effect of goodwill
and other
intangibles .09 .13 1.89 2.79 3.55
--------- --------- --------- --------- ---------
Equity to assets
(GAAP) 8.47% 7.75% 10.77% 11.12% 10.22%
========= ========= ========= ========= =========
Tangible common
equity to risk-
weighted assets
reconciliation
Tangible common
equity to risk-
weighted assets 8.33% 8.25% 5.64% 10.39% 8.34%
Effect of other
comprehensive income .51 (.03) (.42) (.87) (.91)
Effect of deferred
tax limitation - - - (1.27) -
Effect of trust
preferred 1.15 1.18 1.06 .97 .88
Effect of preferred
equity 4.24 4.29 3.53 3.19 2.90
--------- --------- --------- --------- ---------
Tier I capital
ratio (Regulatory) 14.23% 13.69% 9.81% 12.41% 11.21%
========= ========= ========= ========= =========
Net charge-offs
reconciliation
Operating net charge-
offs $ 69,831 $ 311,227 $ 215,657 $ 276,669 $ 151,152
Subsequent partial
recovery of fraud-
related charge-off - - (11,750) - -
--------- --------- --------- --------- ---------
Net charge-offs
(GAAP) $ 69,831 $ 311,227 $ 203,907 $ 276,669 $ 151,152
========= ========= ========= ========= =========
Net charge-offs to
average loans
reconciliation
Operating net charge-
offs to average
loans 1.69% 7.33% 4.42% 5.03% 2.57%
Subsequent partial
recovery of fraud-
related charge-off - - (.25) - -
--------- --------- --------- --------- ---------
Net charge-offs to
average loans
(GAAP) 1.69% 7.33% 4.17% 5.03% 2.57%
========= ========= ========= ========= =========
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Loan Portfolio Composition at
Period-End (1)
---------------------------------------
2012 2011
------------------------------- -------
Fourth Third Second First Fourth
(in millions) Quarter Quarter Quarter Quarter Quarter
------- ------- ------- ------- -------
LOANS BY CATEGORY
Owner occupied commercial RE $ 1,131 $ 1,126 $ 1,140 $ 1,137 $ 1,112
Income producing commercial RE 682 693 697 706 710
Commercial & industrial 458 460 450 440 428
Commercial construction 155 161 169 167 164
------- ------- ------- ------- -------
Total commercial 2,426 2,440 2,456 2,450 2,414
Residential mortgage 829 833 834 836 835
Home equity lines of credit 385 341 294 295 300
Residential construction 382 389 409 436 448
Consumer installment 153 135 126 111 113
------- ------- ------- ------- -------
Total loans $ 4,175 $ 4,138 $ 4,119 $ 4,128 $ 4,110
======= ======= ======= ======= =======
LOANS BY MARKET
North Georgia $ 1,364 $ 1,383 $ 1,387 $ 1,408 $ 1,426
Atlanta MSA 1,288 1,257 1,252 1,239 1,220
North Carolina 579 579 576 588 597
Coastal Georgia 400 380 369 366 346
Gainesville MSA 261 256 259 262 265
East Tennessee 283 283 276 265 256
------- ------- ------- ------- -------
Total loans $ 4,175 $ 4,138 $ 4,119 $ 4,128 $ 4,110
======= ======= ======= ======= =======
RESIDENTIAL CONSTRUCTION
Dirt loans
Acquisition & development $ 62 $ 71 $ 78 $ 86 $ 88
Land loans 46 41 45 57 61
Lot loans 193 196 203 204 207
------- ------- ------- ------- -------
Total 301 308 326 347 356
------- ------- ------- ------- -------
House loans
Spec 41 44 49 57 59
Sold 40 37 34 32 33
------- ------- ------- ------- -------
Total 81 81 83 89 92
------- ------- ------- ------- -------
Total residential construction $ 382 $ 389 $ 409 $ 436 $ 448
======= ======= ======= ======= =======
(1) Excludes total loans of $33.4 million, $37.0 million, $41.5 million,
$47.2 million and $54.5 million as of December 31, 2012, September 30,
2012, June 30, 2012, March 31, 2012 and December 31, 2011, respectively,
that are covered by the loss-sharing agreement with the FDIC, related to
the acquisition of Southern Community Bank.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Loan Portfolio Composition at Period-End (1)
------------------------------------------
2012 2011
--------------- ------- Linked Year over
Fourth Third Fourth Quarter Year
(in millions) Quarter Quarter Quarter Change Change
------- ------- ------- -------- --------
LOANS BY CATEGORY
Owner occupied commercial RE $ 1,131 $ 1,126 $ 1,112 $ 5 $ 19
Income producing commercial RE 682 693 710 (11) (28)
Commercial & industrial 458 460 428 (2) 30
Commercial construction 155 161 164 (6) (9)
------- ------- -------
Total commercial 2,426 2,440 2,414 (14) 12
Residential mortgage 829 833 835 (4) (6)
Home equity lines of credit 385 341 300 44 85
Residential construction 382 389 448 (7) (66)
Consumer installment 153 135 113 18 40
------- ------- -------
Total loans $ 4,175 $ 4,138 $ 4,110 37 65
======= ======= =======
LOANS BY MARKET
North Georgia $ 1,364 $ 1,383 $ 1,426 (19) (62)
Atlanta MSA 1,288 1,257 1,220 31 68
North Carolina 579 579 597 - (18)
Coastal Georgia 400 380 346 20 54
Gainesville MSA 261 256 265 5 (4)
East Tennessee 283 283 256 - 27
------- ------- -------
Total loans $ 4,175 $ 4,138 $ 4,110 37 65
======= ======= =======
RESIDENTIAL CONSTRUCTION
Dirt loans
Acquisition & development $ 62 $ 71 $ 88 (9) (26)
Land loans 46 41 61 5 (15)
Lot loans 193 196 207 (3) (14)
------- ------- -------
Total 301 308 356 (7) (55)
------- ------- -------
House loans
Spec 41 44 59 (3) (18)
Sold 40 37 33 3 7
------- ------- -------
Total 81 81 92 - (11)
------- ------- -------
Total residential construction $ 382 $ 389 $ 448 (7) (66)
======= ======= =======
(1) Excludes total loans of $33.4 million, $37.0 million, $41.5 million,
$47.2 million and $54.5 million as of December 31, 2012, September 30,
2012, June 30, 2012, March 31, 2012 and December 31, 2011, respectively,
that are covered by the loss-sharing agreement with the FDIC, related to
the acquisition of Southern Community Bank.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Loan Portfolio Composition at Year-End (1)
--------------------------------------------
(in millions) 2012 2011 2010 2009 2008
-------- -------- -------- -------- --------
LOANS BY CATEGORY
Owner occupied commercial RE $ 1,131 $ 1,112 $ 980 $ 963 $ 955
Income producing commercial RE 682 710 781 816 672
Commercial & industrial 458 428 441 390 410
Commercial construction 155 164 297 363 500
-------- -------- -------- -------- --------
Total commercial 2,426 2,414 2,499 2,532 2,537
Residential mortgage 829 835 944 1,052 1,142
Home equity lines of credit 385 300 335 375 384
Residential construction 382 448 695 1,050 1,479
Consumer / installment 153 113 131 142 163
-------- -------- -------- -------- --------
Total loans $ 4,175 $ 4,110 $ 4,604 $ 5,151 $ 5,705
======== ======== ======== ======== ========
LOANS BY MARKET
North Georgia $ 1,364 $ 1,426 $ 1,689 $ 1,884 $ 2,040
Atlanta MSA 1,288 1,220 1,310 1,435 1,706
North Carolina 579 597 702 772 810
Coastal Georgia 400 346 335 405 464
Gainesville MSA 261 265 312 390 420
East Tennessee 283 256 256 265 265
-------- -------- -------- -------- --------
Total loans $ 4,175 $ 4,110 $ 4,604 $ 5,151 $ 5,705
======== ======== ======== ======== ========
(1) Excludes total loans of $33.4 million, $54.5 million, $68.2 million and
$85.1 million as of December 31, 2012, 2011, 2010 and 2009, respectively,
that are covered by the loss-sharing agreement with the FDIC, related to
the acquisition of Southern Community Bank.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality(1)
----------------------------------
Fourth Quarter 2012
----------------------------------
Non-
performing Foreclosed Total
(in thousands) Loans Properties NPAs
---------- ---------- ----------
NPAs BY CATEGORY
Owner occupied CRE $ 12,599 $ 4,989 $ 17,588
Income producing CRE 9,549 490 10,039
Commercial & industrial 31,817 - 31,817
Commercial construction 23,843 2,204 26,047
---------- ---------- ----------
Total commercial 77,808 7,683 85,491
Residential mortgage 11,151 4,753 15,904
Home equity lines of credit 1,438 - 1,438
Residential construction 18,702 5,828 24,530
Consumer installment 795 - 795
---------- ---------- ----------
Total NPAs $ 109,894 $ 18,264 $ 128,158
========== ========== ==========
Balance as a % of Unpaid Principal 69.5% 39.7% 62.8%
NPAs BY MARKET
North Georgia $ 69,950 $ 8,219 $ 78,169
Atlanta MSA 18,556 3,442 21,998
North Carolina 11,014 2,579 13,593
Coastal Georgia 3,810 1,609 5,419
Gainesville MSA 903 556 1,459
East Tennessee 5,661 1,859 7,520
---------- ---------- ----------
Total NPAs $ 109,894 $ 18,264 $ 128,158
========== ========== ==========
NPA ACTIVITY
Beginning Balance $ 115,001 $ 26,958 $ 141,959
Loans placed on non-accrual 20,211 - 20,211
Payments received (6,458) - (6,458)
Loan charge-offs (11,722) - (11,722)
Foreclosures (7,138) 7,138 -
Capitalized costs - 201 201
Note / property sales - (12,845) (12,845)
Write downs - (1,438) (1,438)
Net gains (losses) on sales - (1,750) (1,750)
---------- ---------- ----------
Ending Balance $ 109,894 $ 18,264 $ 128,158
========== ========== ==========
(1) Excludes non-performing loans and foreclosed properties covered by the
loss-sharing agreement with the FDIC, related to the acquisition of
Southern Community Bank.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality(1)
----------------------------------
Third Quarter 2012
----------------------------------
Non-
performing Foreclosed Total
(in thousands) Loans Properties NPAs
---------- ---------- ----------
NPAs BY CATEGORY
Owner occupied CRE $ 14,140 $ 7,170 $ 21,310
Income producing CRE 11,756 1,597 13,353
Commercial & industrial 32,678 - 32,678
Commercial construction 18,590 3,121 21,711
---------- ---------- ----------
Total commercial 77,164 11,888 89,052
Residential mortgage 12,629 6,031 18,660
Home equity lines of credit 1,367 - 1,367
Residential construction 22,935 9,039 31,974
Consumer installment 906 - 906
---------- ---------- ----------
Total NPAs $ 115,001 $ 26,958 $ 141,959
========== ========== ==========
Balance as a % of Unpaid Principal 68.8% 36.4% 58.8%
NPAs BY MARKET
North Georgia $ 72,211 $ 14,582 $ 86,793
Atlanta MSA 21,349 5,926 27,275
North Carolina 9,622 2,771 12,393
Coastal Georgia 6,822 864 7,686
Gainesville MSA 840 1,328 2,168
East Tennessee 4,157 1,487 5,644
---------- ---------- ----------
Total NPAs $ 115,001 $ 26,958 $ 141,959
========== ========== ==========
NPA ACTIVITY
Beginning Balance $ 115,340 $ 30,421 $ 145,761
Loans placed on non-accrual 30,535 - 30,535
Payments received (3,646) - (3,646)
Loan charge-offs (19,227) - (19,227)
Foreclosures (8,001) 8,001 -
Capitalized costs - 102 102
Note / property sales - (8,822) (8,822)
Write downs - (2,394) (2,394)
Net gains (losses) on sales - (350) (350)
---------- ---------- ----------
Ending Balance $ 115,001 $ 26,958 $ 141,959
========== ========== ==========
(1) Excludes non-performing loans and foreclosed properties covered by the
loss-sharing agreement with the FDIC, related to the acquisition of
Southern Community Bank.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality(1)
----------------------------------
Second Quarter 2012
----------------------------------
Non-
performing Foreclosed Total
(in thousands) Loans Properties NPAs
---------- ---------- ----------
NPAs BY CATEGORY
Owner occupied CRE $ 9,399 $ 7,914 $ 17,313
Income producing CRE 9,716 2,672 12,388
Commercial & industrial 34,982 - 34,982
Commercial construction 18,175 2,732 20,907
---------- ---------- ----------
Total commercial 72,272 13,318 85,590
Residential mortgage 15,272 5,591 20,863
Home equity lines of credit 1,359 - 1,359
Residential construction 25,530 11,512 37,042
Consumer installment 907 - 907
---------- ---------- ----------
Total NPAs $ 115,340 $ 30,421 $ 145,761
========== ========== ==========
Balance as a % of Unpaid Principal 68.8% 39.3% 59.4%
NPAs BY MARKET
North Georgia $ 77,332 $ 13,546 $ 90,878
Atlanta MSA 17,593 8,651 26,244
North Carolina 10,657 3,287 13,944
Coastal Georgia 5,822 785 6,607
Gainesville MSA 991 2,998 3,989
East Tennessee 2,945 1,154 4,099
---------- ---------- ----------
Total NPAs $ 115,340 $ 30,421 $ 145,761
========== ========== ==========
NPA ACTIVITY
Beginning Balance $ 129,704 $ 31,887 $ 161,591
Loans placed on non-accrual 29,364 - 29,364
Payments received (15,027) - (15,027)
Loan charge-offs (19,382) - (19,382)
Foreclosures (9,319) 9,319 -
Capitalized costs - 415 415
Note / property sales - (10,461) (10,461)
Write downs - (1,008) (1,008)
Net gains (losses) on sales - 269 269
---------- ---------- ----------
Ending Balance $ 115,340 $ 30,421 $ 145,761
========== ========== ==========
(1) Excludes non-performing loans and foreclosed properties covered by the
loss-sharing agreement with the FDIC, related to the acquisition of
Southern Community Bank.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality(1)
------------------------------------------------------
Fourth Quarter Third Quarter Second Quarter
2012 2012 2012
---------------- ----------------- -----------------
Net Net Net
Charge- Charge- Charge-
Offs to Offs to Offs to
Net Average Net Average Net Average
(in thousands) Charge- Loans Charge- Loans Charge- Loans
Offs (2) Offs (2) Offs (2)
-------- ------- -------- ------- -------- -------
NET CHARGE-OFFS BY
CATEGORY
Owner occupied CRE $ 4,997 1.76% $ 6,192 3.56% $ 1,305 .46%
Income producing CRE 1,153 .67 1,982 .70 3,044 1.75
Commercial &
industrial 135 .12 (259) (.23) 775 .70
Commercial
construction 1,688 4.25 3,190 7.74 88 .21
-------- -------- --------
Total commercial 7,973 1.30 11,105 1.81 5,212 .86
Residential mortgage 3,254 1.55 2,846 1.40 1,971 .70
Home equity lines of
credit 445 .49 681 .80 1,891 2.60
Residential
construction 2,435 2.52 5,676 5.69 9,563 9.14
Consumer installment 398 1.10 255 .78 259 .88
-------- -------- --------
Total $ 14,505 1.39 $ 20,563 1.99 $ 18,896 1.85
======== ======== ========
NET CHARGE-OFFS BY
MARKET
North Georgia $ 4,474 1.26% $ 6,451 1.84% $ 12,474 3.58%
Atlanta MSA 3,977 1.27 9,344 3.02 2,307 .75
North Carolina 2,032 1.39 1,674 1.15 3,634 2.52
Coastal Georgia 574 .60 2,486 2.67 211 .23
Gainesville MSA 1,331 2.04 294 .45 (187) (.29)
East Tennessee 2,117 2.98 314 .45 457 .68
-------- -------- --------
Total $ 14,505 1.39 $ 20,563 1.99 $ 18,896 1.85
======== ======== ========
(1) Excludes non-performing loans and foreclosed properties covered by the
loss-sharing agreement with the FDIC, related to the acquisition of
Southern Community Bank.
(2) Annualized.
UNITED COMMUNITY BANKS, INC.
Consolidated Statement of
Operations(Unaudited)
-----------------------------------------
Three Months Ended Twelve Months Ended
December 31, December 31,
------------------- --------------------
(in thousands, except per share
data) 2012 2011 2012 2011
--------- --------- --------- ---------
Interest revenue:
Loans, including fees $ 53,335 $ 57,697 $ 217,140 $ 239,056
Investment securities,
including tax exempt of $219,
$255, $956 and $1,009 9,841 13,296 44,613 56,260
Federal funds sold, reverse
repurchase agreements,
commercial paper and deposits
in banks 893 489 3,986 2,321
--------- --------- --------- ---------
Total interest revenue 64,069 71,482 265,739 297,637
--------- --------- --------- ---------
Interest expense:
Deposits:
NOW 462 807 2,049 3,998
Money market 617 800 2,518 5,456
Savings 38 41 150 234
Time 3,674 7,338 19,518 39,151
--------- --------- --------- ---------
Total deposit interest
expense 4,791 8,986 24,235 48,839
Federal funds purchased,
repurchase agreements and other
short-term borrowings 524 1,053 2,987 4,250
Federal Home Loan Bank advances 25 441 907 2,042
Long-term debt 3,082 2,375 10,201 10,544
--------- --------- --------- ---------
Total interest expense 8,422 12,855 38,330 65,675
--------- --------- --------- ---------
Net interest revenue 55,647 58,627 227,409 231,962
Provision for loan losses 14,000 14,000 62,500 251,000
--------- --------- --------- ---------
Net interest revenue after
provision for loan losses 41,647 44,627 164,909 (19,038)
--------- --------- --------- ---------
Fee revenue:
Service charges and fees 8,375 7,248 31,670 29,110
Mortgage loan and other related
fees 3,262 1,825 10,483 5,419
Brokerage fees 751 782 3,082 2,986
Securities gains, net 31 4 7,078 842
Loss from prepayment of debt - - (6,681) (791)
Other 2,342 2,808 11,139 12,342
--------- --------- --------- ---------
Total fee revenue 14,761 12,667 56,771 49,908
--------- --------- --------- ---------
Total revenue 56,408 57,294 221,680 30,870
--------- --------- --------- ---------
Operating expenses:
Salaries and employee benefits 23,586 23,473 96,026 100,095
Communications and equipment 3,320 3,129 12,940 13,135
Occupancy 3,455 3,972 14,304 15,645
Advertising and public
relations 987 944 3,855 4,291
Postage, printing and supplies 1,050 1,017 3,899 4,256
Professional fees 2,685 1,996 8,792 9,727
Foreclosed property 4,611 9,302 13,993 78,905
FDIC assessments and other
regulatory charges 2,505 2,599 10,097 14,259
Amortization of intangibles 727 746 2,917 3,016
Other 3,800 3,902 15,951 18,270
--------- --------- --------- ---------
Total operating expenses 46,726 51,080 182,774 261,599
--------- --------- --------- ---------
Net income (loss) before
income taxes 9,682 6,214 38,906 (230,729)
Income tax (benefit) expense 421 (3,687) 1,050 (3,983)
--------- --------- --------- ---------
Net income (loss) 9,261 9,901 37,856 (226,746)
Preferred stock dividends and
discount accretion 3,045 3,025 12,148 11,838
--------- --------- --------- ---------
Net income (loss) available
to common shareholders $ 6,216 $ 6,876 $ 25,708 $(238,584)
========= ========= ========= =========
Earnings (loss) per common share
- Basic $ .11 $ .12 $ .44 $ (5.97)
Earnings (loss) per common share
- Diluted .11 .12 .44 (5.97)
Weighted average common shares
outstanding - Basic 57,971 57,646 57,857 39,943
Weighted average common shares
outstanding - Diluted 57,971 57,646 57,857 39,943
UNITED COMMUNITY BANKS, INC.
Consolidated Balance Sheet
------------- -------------
(in thousands, except share and per share December 31, December 31,
data) 2012 2011
------------- -------------
(unaudited) (audited)
ASSETS
Cash and due from banks $ 66,536 $ 53,807
Interest-bearing deposits in banks 124,613 139,609
Federal funds sold, reverse repurchase
agreements, securities lending, commercial
paper and short-term investments 60,000 185,000
------------- -------------
Cash and cash equivalents 251,149 378,416
Securities available for sale 1,834,593 1,790,047
Securities held to maturity (fair value
$261,131 and $343,531) 244,184 330,203
Mortgage loans held for sale 28,821 23,881
Loans, net of unearned income 4,175,008 4,109,614
Less allowance for loan losses (107,137) (114,468)
------------- -------------
Loans, net 4,067,871 3,995,146
Assets covered by loss sharing agreements
with the FDIC 47,467 78,145
Premises and equipment, net 168,920 175,088
Bank owned life insurance 81,867 80,599
Accrued interest receivable 18,659 20,693
Goodwill and other intangible assets 5,510 8,428
Foreclosed property 18,264 32,859
Other assets 34,954 69,915
------------- -------------
Total assets $ 6,802,259 $ 6,983,420
============= =============
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Deposits:
Demand $ 1,252,605 $ 992,109
NOW 1,316,453 1,509,896
Money market 1,149,912 1,038,778
Savings 227,308 199,007
Time:
Less than $100,000 1,055,271 1,332,394
Greater than $100,000 705,558 847,152
Brokered 245,033 178,647
------------- -------------
Total deposits 5,952,140 6,097,983
Federal funds purchased, repurchase
agreements, and other short-term borrowings 52,574 102,577
Federal Home Loan Bank advances 40,125 40,625
Long-term debt 124,805 120,225
Unsettled securities purchases - 10,325
Accrued expenses and other liabilities 47,210 36,199
------------- -------------
Total liabilities 6,216,854 6,407,934
------------- -------------
Shareholders' equity:
Preferred stock, $1 par value; 10,000,000
shares authorized;
Series A; $10 stated value; 21,700 shares
issued and outstanding 217 217
Series B; $1,000 stated value; 180,000
shares issued and outstanding 178,557 177,092
Series D; $1,000 stated value; 16,613
shares issued and outstanding 16,613 16,613
Common stock, $1 par value; 100,000,000
shares authorized; 42,423,870 and
41,647,100 shares issued and outstanding 42,424 41,647
Common stock, non-voting, $1 par value;
30,000,000 shares authorized; 15,316,794
and 15,914,209 shares issued and
outstanding 15,317 15,914
Common stock issuable; 133,238 and 93,681
shares 3,119 3,233
Capital surplus 1,057,951 1,054,940
Accumulated deficit (705,153) (730,861)
Accumulated other comprehensive loss (23,640) (3,309)
------------- -------------
Total shareholders' equity 585,405 575,486
------------- -------------
Total liabilities and shareholders' equity $ 6,802,259 $ 6,983,420
============= =============
UNITED COMMUNITY BANKS, INC.
Average Consolidated Balance Sheets and Net Interest Analysis
For the Three Months Ended December 31,
----------------------------------------------------
2012 2011
------------------------- -------------------------
(dollars in thousands, Average Avg. Average Avg.
taxable equivalent) Balance Interest Rate Balance Interest Rate
---------- -------- ---- ---------- -------- ----
Assets:
Interest-earning
assets:
Loans, net of
unearned income
(1)(2) $4,190,725 $ 53,366 5.07% $4,175,320 $ 57,773 5.49%
Taxable securities
(3) 2,065,311 9,622 1.86 2,114,069 13,041 2.47
Tax-exempt
securities (1)(3) 22,483 358 6.37 27,224 417 6.13
Federal funds sold
and other interest-
earning assets 203,090 1,104 2.17 371,606 674 .73
---------- -------- ---------- --------
Total interest-
earning assets 6,481,609 64,450 3.96 6,688,219 71,905 4.27
---------- -------- ---------- --------
Non-interest-earning
assets:
Allowance for loan
losses (112,846) (145,559)
Cash and due from
banks 54,714 54,485
Premises and
equipment 169,967 176,182
Other assets (3) 184,398 245,664
---------- ----------
Total assets $6,777,842 $7,018,991
========== ==========
Liabilities and
Shareholders' Equity:
Interest-bearing
liabilities:
Interest-bearing
deposits:
NOW $1,261,796 462 .15 $1,451,581 807 .22
Money market 1,200,701 617 .20 1,041,375 800 .30
Savings 224,624 38 .07 198,541 41 .08
Time less than
$100,000 1,082,761 1,982 .73 1,358,367 3,668 1.07
Time greater than
$100,000 715,902 1,673 .93 875,434 2,867 1.30
Brokered time
deposits 135,708 19 .06 180,933 803 1.76
---------- -------- ---------- --------
Total interest-
bearing
deposits 4,621,492 4,791 .41 5,106,231 8,986 .70
---------- -------- ---------- --------
Federal funds
purchased and
other borrowings 67,403 524 3.09 102,776 1,053 4.06
Federal Home Loan
Bank advances 39,092 25 .25 40,625 441 4.31
Long-term debt 149,564 3,082 8.20 120,217 2,375 7.84
---------- -------- ---------- --------
Total borrowed
funds 256,059 3,631 5.64 263,618 3,869 5.82
---------- -------- ---------- --------
Total interest-
bearing
liabilities 4,877,551 8,422 .69 5,369,849 12,855 .95
-------- --------
Non-interest-bearing
liabilities:
Non-interest-bearing
deposits 1,251,327 1,008,327
Other liabilities 63,785 59,908
---------- ----------
Total
liabilities 6,192,663 6,438,084
Shareholders' equity 585,179 580,907
---------- ----------
Total
liabilities and
shareholders'
equity $6,777,842 $7,018,991
========== ==========
Net interest revenue $ 56,028 $ 59,050
======== ========
Net interest-rate
spread 3.27% 3.32%
==== ====
Net interest margin
(4) 3.44% 3.51%
==== ====
(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 39%, 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 where
the accrual of interest has been discontinued and loans that are held for
sale.
(3) Securities available for sale are shown at amortized cost. Pretax
unrealized gains of $22.2 million in 2012 and $31.3 million in 2011 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 Twelve Months Ended December 31,
------------------------- -------------------------
2012 2011
------------------------- -------------------------
(dollars in thousands, Average Avg. Average Avg.
taxable equivalent) Balance Interest Rate Balance Interest Rate
---------- -------- ---- ---------- -------- ----
Assets:
Interest-earning
assets:
Loans, net of
unearned income
(1)(2) $4,165,520 $217,467 5.22% $4,307,111 $239,195 5.55%
Taxable securities
(3) 2,065,162 43,657 2.11 1,973,678 55,251 2.80
Tax-exempt
securities (1)(3) 23,759 1,565 6.59 25,693 1,651 6.43
Federal funds sold
and other interest-
earning assets 292,857 4,740 1.62 478,403 3,247 .68
---------- -------- ---------- --------
Total interest-
earning assets 6,547,298 267,429 4.08 6,784,885 299,344 4.41
---------- -------- ---------- --------
Non-interest-earning
assets:
Allowance for loan
losses (114,647) (145,656)
Cash and due from
banks 53,247 90,212
Premises and
equipment 172,544 178,061
Other assets (3) 206,609 281,233
---------- ----------
Total assets $6,865,051 $7,188,735
========== ==========
Liabilities and
Shareholders' Equity:
Interest-bearing
liabilities:
Interest-bearing
deposits:
NOW $1,293,510 2,049 .16 $1,348,493 3,998 .30
Money market 1,140,354 2,518 .22 993,871 5,456 .55
Savings 216,880 150 .07 195,468 234 .12
Time less than
$100,000 1,170,202 9,788 .84 1,471,596 18,648 1.27
Time greater than
$100,000 766,411 8,027 1.05 948,659 14,347 1.51
Brokered time
deposits 155,902 1,703 1.09 401,393 6,156 1.53
---------- -------- ---------- --------
Total interest-
bearing
deposits 4,743,259 24,235 .51 5,359,480 48,839 .91
---------- -------- ---------- --------
Federal funds
purchased and
other borrowings 80,593 2,987 3.71 102,727 4,250 4.14
Federal Home Loan
Bank advances 124,771 907 .73 47,220 2,042 4.32
Long-term debt 127,623 10,201 7.99 139,666 10,544 7.55
---------- -------- ---------- --------
Total borrowed
funds 332,987 14,095 4.23 289,613 16,836 5.81
---------- -------- ---------- --------
Total interest-
bearing
liabilities 5,076,246 38,330 .76 5,649,093 65,675 1.16
-------- --------
Non-interest-bearing
liabilities:
Non-interest-bearing
deposits 1,142,236 915,649
Other liabilities 64,986 66,809
---------- ----------
Total
liabilities 6,283,468 6,631,551
Shareholders' equity 581,583 557,184
---------- ----------
Total
liabilities and
shareholders'
equity $6,865,051 $7,188,735
========== ==========
Net interest revenue $229,099 $233,669
======== ========
Net interest-rate
spread 3.32% 3.25%
==== ====
Net interest margin
(4) 3.50% 3.44%
==== ====
(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 39%, 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 where
the accrual of interest has been discontinued and loans that are held for
sale.
(3) Securities available for sale are shown at amortized cost. Pretax
unrealized gains of $23.6 million in 2012 and $32.2 million in 2011 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.
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