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23.01.2023 23:54:00
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UMPQUA REPORTS FOURTH QUARTER AND FULL-YEAR 2022 RESULTS
Fourth Quarter 2022 Results
- Net income of $83 million, or $0.38 per common share
- Operating net income of $99 million, or $0.46 per common share1
- Loan balances increased $648 million or 2.5%
- Deposit balances increased $249 million or 0.9%
- Net interest margin increased 13 basis points to 4.01%
PORTLAND, Ore., Jan. 23, 2023 /PRNewswire/ --
UMPQUA REPORTS FOURTH QUARTER AND FULL-YEAR 2022 RESULTS | ||||||
$0.38 | $83 | 13.53 % | 13.7 % | |||
4Q22 Net earnings per diluted | 4Q22 Net income ($ in millions) | 4Q22 Return on avg tangible | Total risk-based capital ratio | |||
CEO Commentary |
"Continued growth, outstanding credit quality, and net interest margin expansion again characterize Umpqua's quarterly results and round out what has been an exceptional year for the bank," said Cort O'Haver, President and CEO. "As we look forward to our upcoming merger with Columbia Banking System, which we expect to close on February 28, 2023, I want to thank our teams for their tireless efforts over the past 15 months. Umpqua associates' support of each other and dedicated focus on relationship banking with our customers and within our communities is evidenced by our ability to profitably grow the bank while simultaneously planning for our transformational combination with Columbia." |
– Cort O'Haver, President and CEO of Umpqua Holdings Corporation
4Q22 HIGHLIGHTS (COMPARED TO 3Q22) | |
Net Interest Income and NIM | • Net interest income increased by $18 million or 6% on a quarter-to-quarter basis due to the favorable impact of rising interest rates and higher average earning asset balances. |
• Net interest margin was 4.01%, up 13 basis points from the prior quarter. Total deposit costs were 46 basis points for the quarterly average and 66 basis points on December 31, 2022, compared to 22 basis points on September 30, 2022. | |
Non-Interest Income and Expense | • Non-interest income increased by $5.4 million as a smaller loss related to the impact of interest rates on fair value accounting and hedges was partially offset by lower residential mortgage gain-on-sale income. |
• Non-interest expense increased by $17 million due primarily to higher merger-related expenses and a $4.9 million accrual for state and local business taxes captured in other expenses that is not expect to repeat in future quarters. | |
Credit Quality | • Net charge-offs were 0.19% of average loans and leases (annualized) and centered in the FinPac portfolio. |
• Provision expense of $33 million compares to $28 million for the prior quarter. | |
• Non-performing assets to total assets was 0.18% compared to 0.16% at September 30, 2022. | |
Capital | • Estimated total risk-based capital ratio of 13.7% and estimated tier 1 risk-based capital ratio of 11.0%. |
• Declared a quarterly cash dividend of $0.21 per common share on January 11, 2023, payable February 6, 2023, to holders of record as of January 23, 2023. | |
Notable items | • Set an expected merger closing date of February 28, 2023 after the close of business, subject to the satisfaction of closing conditions. |
• Structural adjustments within the mortgage banking segment continued as additional changes were announced in January, inclusive of further staff reductions. | |
4Q22 KEY FINANCIAL DATA | |||||
PERFORMANCE METRICS | 4Q22 | 3Q22 | 4Q21 | ||
Return on average assets | 1.04 % | 1.09 % | 1.13 % | ||
Return on average tangible common equity1 | 13.53 % | 13.02 % | 12.94 % | ||
Operating return on average assets1 | 1.24 % | 1.33 % | 1.23 % | ||
Operating return on average tangible common equity1 | 16.18 % | 15.90 % | 14.03 % | ||
Net interest margin | 4.01 % | 3.88 % | 3.15 % | ||
Efficiency ratio | 57.24 % | 56.07 % | 63.10 % | ||
Loan to deposit ratio | 96.64 % | 95.12 % | 84.80 % | ||
INCOME STATEMENT ($ in 000s, excl. per share data) | 4Q22 | 3Q22 | 4Q21 | ||
Net interest income | $305,479 | $287,604 | $233,379 | ||
Provision (recapture) for credit losses | $32,948 | $27,572 | ($736) | ||
Non-interest income | $34,879 | $29,445 | $82,738 | ||
Non-interest expense | $194,982 | $177,964 | $199,711 | ||
Pre-provision net revenue1 | $145,376 | $139,085 | $116,406 | ||
Operating pre-provision net revenue1 | $167,094 | $163,793 | $122,633 | ||
Earnings per common share - diluted | $0.38 | $0.39 | $0.41 | ||
Operating earnings per common share - diluted1 | $0.46 | $0.47 | $0.44 | ||
Dividends paid per share | $0.21 | $0.21 | $0.21 | ||
BALANCE SHEET | 4Q22 | 3Q22 | 4Q21 | ||
Total assets | $31.8B | $31.5B | $30.6B | ||
Loans and leases | $26.2B | $25.5B | $22.6B | ||
Total deposits | $27.1B | $26.8B | $26.6B | ||
Book value per common share | $11.42 | $11.14 | $12.69 | ||
Tangible book value per share | $11.40 | $11.11 | $12.65 | ||
Tangible book value per share, ex AOCI1 | $13.37 | $13.18 | $12.64 | ||
Balance Sheet
Total consolidated assets were $31.8 billion as of December 31, 2022, compared to $31.5 billion as of September 30, 2022 and $30.6 billion as of December 31, 2021. Including secured off-balance sheet lines of credit, total available liquidity was $12.0 billion as of December 31, 2022, representing 38% of total assets and 44% of total deposits.
Gross loans and leases were $26.2 billion as of December 31, 2022, an increase of $648 million from $25.5 billion as of September 30, 2022. The majority of loan categories and business lines contributed to the quarter's net expansion, and new loans added to the portfolio during the fourth quarter have similar underwriting characteristics to existing loan categories, as our Q4 2022 Earnings Presentation details.
Total deposits were $27.1 billion as of December 31, 2022, an increase of $249 million from $26.8 billion as of September 30, 2022. The rising interest rate environment and the impact of inflationary pressures on customer spending contributed to a decline in non-interest bearing demand balances during the quarter that was offset by higher time balances. Brokered balances account for approximately 60% of the quarter's growth in time balances.
Net Interest Income
Net interest income was $305 million for the fourth quarter of 2022, up $18 million from the prior quarter. The increase reflects the favorable impact of higher interest rates on our asset sensitive balance sheet and higher average earning asset balances relative to the prior quarter.
The Company's net interest margin was 4.01% for the fourth quarter of 2022, up 13 basis points from 3.88% for the third quarter of 2022. The increase is primarily attributable to higher earning asset yields that outpaced the rising cost of interest-bearing liabilities. The cost of interest-bearing deposits increased to 0.77% for the fourth quarter of 2022 compared to 0.23% for the third quarter of 2022, and it was 1.07% on December 31, 2022 compared to 0.38% on September 30, 2022. Please refer to the Q4 2022 Earnings Presentation available on our website for additional net interest margin change details and interest rate sensitivity information.
Credit Quality
The allowance for credit losses was $315 million, or 1.21% of loans and leases, as of December 31, 2022, compared to $295 million, or 1.16% of loans and leases, as of September 30, 2022. The provision for credit losses of $33 million for the fourth quarter of 2022 compares to a provision of $28 million for the third quarter of 2022. The current quarter's provision reflects allowance requirements for changes between the August 2022 and November 2022 economic forecasts used in credit models, which contributed to the quarter's expense; loan portfolio mix changes and performance; and new loan generation. Please refer to the Q4 2022 Earnings Presentation available on our website for additional details related to the allowance for credit losses.
Net charge-offs were 0.19% of average loans and leases (annualized) for the fourth quarter of 2022, compared to 0.11% for the third quarter of 2022. The FinPac portfolio drove the linked-quarter increase in charge-offs as activity has begun to approach normalized levels after several quarters below its historical average. Excluding FinPac, net charge-offs were 0.01% for the fourth quarter of 2022. As of December 31, 2022, non-performing assets were 0.18% of total assets, compared to 0.16% as of September 30, 2022 and 0.17% as of December 31, 2021.
Non-interest Income
Non-interest income was $35 million for the fourth quarter of 2022, up $5.4 million from the prior quarter. The increase was driven by a lower adverse impact from interest rate-related adjustments as a net fair value loss of $8.1 million in the fourth quarter related to cumulative fair value adjustments and MSR hedging activity compares to a net fair value loss of $23 million in the third quarter. The favorable variance was partially offset by lower income from the origination and sale of mortgages.
As detailed in our segment and non-GAAP disclosures, non-interest income for the Core Banking segment includes a fair value gain of $2.1 million for the fourth quarter of 2022 compared to a $25 million fair value loss in the third quarter of 2022. Interest rate changes drive fair value adjustments for equity securities, swap derivatives, and loans carried at fair value. The modest decline in long-term interest rates experienced during the fourth quarter compares to the larger increase in the prior quarter, with the difference in the trajectory and magnitude of the changes accounting for the $27 million linked-quarter variance in fair value adjustments, which is captured in other income. Please refer to the Q4 2022 Earnings Presentation for additional details related to other non-interest income.
Revenue from the origination and sale of residential mortgages was $4.3 million for the fourth quarter of 2022 compared to $10.5 million for the prior quarter. The linked-quarter decline reflects a sequential quarter decrease of $180 million or 45% in for-sale mortgage origination volume and a decline in the home lending gain on sale margin to 1.96% for the fourth quarter of 2022 compared to 2.65% for the prior quarter. Of the current quarter's mortgage production, 89% related to purchase activity, compared to 92% for the prior quarter and 54% for the same period in the prior year. In the fourth quarter of 2022, we recorded a net write down of the MSR asset of $15 million, which includes a $10 million fair value loss related to model inputs. We correspondingly recorded a $0.3 million loss during the quarter related to the MSR hedges put in place in mid-August 2022. An increase in the expected cost of escrow deposits, which is not hedged, was the primary driver of the quarter's decline in the MSR asset value due to model inputs.
Non-interest Expense
Non-interest expense was $195 million for the fourth quarter of 2022, an increase of $17 million from the prior quarter level. The current quarter includes $11.6 million in merger-related expenses, $2.0 million in exit and disposal costs related to store consolidations and back-office lease exits, and a $4.9 million accrual for state and local business taxes captured in other expenses that is not expect to repeat in future quarters. Please refer to the Q4 2022 Earnings Presentation for quarterly expense change details.
Capital
As of December 31, 2022, the Company's tangible book value per common share[1] was $11.40, which compares to $11.11 at September 30, 2022 and $12.65 at December 31, 2021. While rising interest rates drove a decline in the fair value of available-for-sale investment securities and an increase in the fair value of junior subordinated debt between year-end 2021 and year-end 2022, a modest decrease in interest rates during the fourth quarter contributed to a slight reversal of these trends and the linked-quarter increase in tangible book value. These fair value change impacts are captured in accumulated other comprehensive (loss) income ("AOCI"), which was $(427) million at December 31, 2022, compared to $(450) million at September 30, 2022 and $1.8 million at December 31, 2021. Excluding AOCI, tangible book1 of $13.37 at December 31, 2022 compares to $13.18 and $12.64 for the linked-quarter and year-ago periods, respectively.
AOCI has no effect on our regulatory capital ratios as the Company opted to exclude it from our common equity tier 1 capital calculations. The Company's estimated total risk-based capital ratio was 13.7% and its estimated tier 1 risk-based capital ratio was 11.0% as of December 31, 2022. The Company remains above current "well-capitalized" regulatory minimums. The regulatory capital ratios as of December 31, 2022 are estimates, pending completion and filing of the Company's regulatory reports.
Segment Disclosures
Segment disclosures on pages 18-20 of this press release provide additional detail on the Company's two operating segments: Core Banking and Mortgage Banking.
The Core Banking segment includes all lines of business, except Mortgage Banking, including commercial, retail, and private banking, as well as the operations, technology, and administrative functions of the Bank and Holding Company. The Mortgage Banking segment includes the revenue earned from the production and sale of residential real estate loans, the servicing income from our serviced loan portfolio, the quarterly changes to the MSR asset, the quarterly changes in the MSR hedge, and the specific expenses that are related to mortgage banking activities including variable commission expenses. Revenue and associated expenses related to residential real estate loans held for investment are included in the Core Banking segment as portfolio loans are primarily originated through the Bank's retail consumer (store) and private banking channels. Management periodically updates the allocation methods and assumptions within the current segment structure.
Earnings Conference Call Information
The Company will host its fourth quarter 2022 earnings conference call on January 24, 2023, at 10:00 a.m. PT (1:00 p.m. ET). During the call, the Company will provide an update on recent activities and discuss its fourth quarter 2022 financial results. Participants may register for the call using the below link to receive dial-in details and their own unique PINs or join the audiocast. It is recommended you join 10 minutes prior to the start time.
Register for the call: https://register.vevent.com/register/BIe0ddbff7399e4e01aaf5599b227fe00d
Join the audiocast: https://edge.media-server.com/mmc/p/tvpg2iae
Access the replay through the Company's investor relations page: https://www.umpquabank.com/investor-relations/
About Umpqua Holdings Corporation
Umpqua Holdings Corporation (Nasdaq: UMPQ), headquartered in Lake Oswego, Oregon, is the parent company of Umpqua Bank, an Oregon-based regional bank that operates in Oregon, Washington, California, Idaho, Nevada, Arizona, and Colorado. Umpqua Bank has been recognized for its innovative customer experience and banking strategy by national publications including The Wall Street Journal, The New York Times, BusinessWeek, Fast Company and CNBC. The company was named #1 in Customer Satisfaction for the Northwest Region in the J.D. Power 2021 U.S. Retail Banking Satisfaction StudySM, and Forbes consistently ranks Umpqua as one of America's Best Banks. The Portland Business Journal has also recognized Umpqua as the Most Admired Financial Services Company in Oregon for 18 consecutive years. In addition to its retail and commercial banking presence, Umpqua Bank owns Financial Pacific Leasing, Inc., a nationally recognized commercial finance company that provides equipment leases to businesses. For more information, visit umpquabank.com.
Forward-Looking Statements
This press release includes forward-looking statements within the meaning of the "Safe-Harbor" provisions of the Private Securities Litigation Reform Act of 1995, which management believes are a benefit to shareholders. These statements are necessarily subject to risk and uncertainty and actual results could differ materially due to various risk factors, including those set forth from time to time in our filings with the SEC. You should not place undue reliance on forward-looking statements and we undertake no obligation to update any such statements. Forward-looking statements can be identified by words such as "anticipates," "intends," "plans," "seeks," "believes," "estimates," "expects," "target," "projects," "outlook," "forecast," "will," "may," "could," "should," "can" and similar references to future periods. In this press release we make forward-looking statements about the closing of our pending merger with Columbia Banking System, Inc. and strategic and growth initiatives. Risks that could cause results to differ from forward-looking statements we make are set forth in our filings with the SEC and include, without limitation: current and future economic and market conditions, including the effects of declines in housing and commercial real estate prices, high unemployment rates, inflation and any slowdown in economic growth particularly in the western United States; the effect of the COVID-19 pandemic, including on our credit quality and business operations, as well as its impact on general economic and financial market conditions; economic forecast variables that are either materially worse or better than end of quarter projections and deterioration in the economy that exceeds current consensus estimates; our ability to effectively manage problem credits; our ability to successfully implement efficiency and operational excellence initiatives; our ability to successfully develop and market new products and technology; changes in laws or regulations; the ability to complete, or any delays in completing, the proposed transaction between us and Columbia Banking System, Inc.; any failure to realize the anticipated benefits of the transaction when expected or at all; certain restrictions during the pendency of the proposed transaction that may impact our ability to pursue certain business opportunities or strategic transactions; the possibility that the transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events, diversion of management's attention from ongoing business operations and opportunities; and potential adverse reactions or changes to business or employee relationships, including those resulting from the completion of the transaction and integration of the companies. We also caution that the amount and timing of any future common stock dividends or repurchases will depend on the earnings, cash requirements and financial condition of the Company, market conditions, capital requirements, applicable law and regulations (including federal securities laws and federal banking regulations), and other factors deemed relevant by the Company's Board of Directors, and may be subject to regulatory approval or conditions.
¹ "Non-GAAP" financial measure. See GAAP to Non-GAAP Reconciliation for the comparable GAAP measurement
TABLE INDEX | |
Page | |
Consolidated Statements of Operations | 7 |
Consolidated Balance Sheets | 9 |
Financial Highlights | 10 |
Loan & Lease Portfolio Balances and Mix | 11 |
Deposit Balances, Mix, and Select Account Details | 13 |
Credit Quality - Non-performing Assets | 14 |
Credit Quality - Allowance for Credit Losses | 15 |
Consolidated Average Balance Sheets, Net Interest Income, and Yields/Rates | 17 |
Segments | 19 |
GAAP to Non-GAAP Reconciliation | 22 |
Umpqua Holdings Corporation | ||||||||||||||
Consolidated Statements of Operations | ||||||||||||||
(Unaudited) | ||||||||||||||
Quarter Ended | % Change | |||||||||||||
(In thousands, except per share data) | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Seq. Quarter | Year over Year | |||||||
Interest income: | ||||||||||||||
Loans and leases | $ 322,350 | $ 278,830 | $ 234,674 | $ 214,404 | $ 221,501 | 16 % | 46 % | |||||||
Interest and dividends on investments: | ||||||||||||||
Taxable | 18,108 | 18,175 | 17,256 | 18,725 | 16,566 | — % | 9 % | |||||||
Exempt from federal income tax | 1,288 | 1,322 | 1,369 | 1,372 | 1,456 | (3) % | (12) % | |||||||
Dividends | 182 | 86 | 84 | 86 | 102 | 112 % | 78 % | |||||||
Temporary investments and interest bearing deposits | 10,319 | 5,115 | 2,919 | 1,353 | 1,229 | 102 % | nm | |||||||
Total interest income | 352,247 | 303,528 | 256,302 | 235,940 | 240,854 | 16 % | 46 % | |||||||
Interest expense: | ||||||||||||||
Deposits | 31,174 | 9,090 | 4,015 | 3,916 | 4,357 | 243 % | nm | |||||||
Securities sold under agreement to repurchase and federal funds purchased | 323 | 545 | 66 | 63 | 48 | (41) % | nm | |||||||
Borrowings | 8,023 | 798 | 50 | 49 | 51 | nm | nm | |||||||
Junior subordinated debentures | 7,248 | 5,491 | 4,001 | 3,149 | 3,019 | 32 % | 140 % | |||||||
Total interest expense | 46,768 | 15,924 | 8,132 | 7,177 | 7,475 | 194 % | nm | |||||||
Net interest income | 305,479 | 287,604 | 248,170 | 228,763 | 233,379 | 6 % | 31 % | |||||||
Provision (recapture) for credit losses | 32,948 | 27,572 | 18,692 | 4,804 | (736) | 19 % | nm | |||||||
Non-interest income: | ||||||||||||||
Service charges on deposits | 12,139 | 12,632 | 12,011 | 11,583 | 11,188 | (4) % | 9 % | |||||||
Card-based fees | 9,017 | 9,115 | 10,530 | 8,708 | 9,355 | (1) % | (4) % | |||||||
Brokerage revenue | 25 | 27 | 27 | 11 | 31 | (7) % | (19) % | |||||||
Residential mortgage banking (loss) revenue, net | (1,812) | 17,341 | 30,544 | 60,786 | 43,185 | (110) % | (104) % | |||||||
Gain on sale of debt securities, net | — | — | — | 2 | 4 | nm | (100) % | |||||||
Gain (loss) on equity securities, net | 284 | (2,647) | (2,075) | (2,661) | (466) | nm | nm | |||||||
Gain on loan and lease sales, net | 1,531 | 1,525 | 1,303 | 2,337 | 4,816 | — % | (68) % | |||||||
BOLI income | 2,033 | 2,023 | 2,110 | 2,087 | 2,101 | — % | (3) % | |||||||
Other income (loss) | 11,662 | (10,571) | 785 | (2,884) | 12,524 | nm | (7) % | |||||||
Total non-interest income | 34,879 | 29,445 | 55,235 | 79,969 | 82,738 | 18 % | (58) % | |||||||
Non-interest expense: | ||||||||||||||
Salaries and employee benefits | 107,982 | 109,164 | 110,942 | 113,138 | 117,477 | (1) % | (8) % | |||||||
Occupancy and equipment, net | 34,021 | 35,042 | 34,559 | 34,829 | 34,310 | (3) % | (1) % | |||||||
Intangible amortization | 1,019 | 1,025 | 1,026 | 1,025 | 1,130 | (1) % | (10) % | |||||||
FDIC assessments | 3,487 | 3,007 | 2,954 | 4,516 | 2,896 | 16 % | 20 % | |||||||
Merger related expenses | 11,637 | 769 | 2,672 | 2,278 | 15,183 | nm | (23) % | |||||||
Other expenses | 36,836 | 28,957 | 27,421 | 26,644 | 28,715 | 27 % | 28 % | |||||||
Total non-interest expense | 194,982 | 177,964 | 179,574 | 182,430 | 199,711 | 10 % | (2) % | |||||||
Income before provision for income taxes | 112,428 | 111,513 | 105,139 | 121,498 | 117,142 | 1 % | (4) % | |||||||
Provision for income taxes | 29,464 | 27,473 | 26,548 | 30,341 | 28,788 | 7 % | 2 % | |||||||
Net income | $ 82,964 | $ 84,040 | $ 78,591 | $ 91,157 | $ 88,354 | (1) % | (6) % | |||||||
Weighted average basic shares outstanding | 217,054 | 217,051 | 217,030 | 216,782 | 216,624 | — % | — % | |||||||
Weighted average diluted shares outstanding | 217,566 | 217,386 | 217,279 | 217,392 | 217,356 | — % | — % | |||||||
Earnings per common share – basic | $ 0.38 | $ 0.39 | $ 0.36 | $ 0.42 | $ 0.41 | (3) % | (7) % | |||||||
Earnings per common share – diluted | $ 0.38 | $ 0.39 | $ 0.36 | $ 0.42 | $ 0.41 | (3) % | (7) % | |||||||
nm = not meaningful | ||||||||||||||
Umpqua Holdings Corporation | ||||||
Consolidated Statements of Operations | ||||||
(Unaudited) | ||||||
Year Ended | % Change | |||||
(In thousands, except per share data) | Dec 31, 2022 | Dec 31, 2021 | Year over Year | |||
Interest income: | ||||||
Loans and leases | $ 1,050,258 | $ 890,515 | 18 % | |||
Interest and dividends on investments: | ||||||
Taxable | 72,264 | 60,399 | 20 % | |||
Exempt from federal income tax | 5,351 | 5,947 | (10) % | |||
Dividends | 438 | 1,318 | (67) % | |||
Temporary investments and interest bearing deposits | 19,706 | 3,864 | 410 % | |||
Total interest income | 1,148,017 | 962,043 | 19 % | |||
Interest expense: | ||||||
Deposits | 48,195 | 27,151 | 78 % | |||
Securities sold under agreement to repurchase and federal funds purchased | 997 | 280 | 256 % | |||
Borrowings | 8,920 | 2,838 | 214 % | |||
Junior subordinated debentures | 19,889 | 12,127 | 64 % | |||
Total interest expense | 78,001 | 42,396 | 84 % | |||
Net interest income | 1,070,016 | 919,647 | 16 % | |||
Provision (recapture) for credit losses | 84,016 | (42,651) | nm | |||
Non-interest income: | ||||||
Service charges on deposits | 48,365 | 42,086 | 15 % | |||
Card-based fees | 37,370 | 36,114 | 3 % | |||
Brokerage revenue | 90 | 5,112 | (98) % | |||
Residential mortgage banking revenue, net | 106,859 | 186,811 | (43) % | |||
Gain on sale of debt securities, net | 2 | 8 | (75) % | |||
Loss on equity securities, net | (7,099) | (1,511) | 370 % | |||
Gain on loan and lease sales, net | 6,696 | 15,715 | (57) % | |||
BOLI income | 8,253 | 8,302 | (1) % | |||
Other (loss) income | (1,008) | 63,681 | (102) % | |||
Total non-interest income | 199,528 | 356,318 | (44) % | |||
Non-interest expense: | ||||||
Salaries and employee benefits | 441,226 | 480,820 | (8) % | |||
Occupancy and equipment, net | 138,451 | 137,546 | 1 % | |||
Intangible amortization | 4,095 | 4,520 | (9) % | |||
FDIC assessments | 13,964 | 9,238 | 51 % | |||
Merger related expenses | 17,356 | 15,183 | 14 % | |||
Other expenses | 119,858 | 113,149 | 6 % | |||
Total non-interest expense | 734,950 | 760,456 | (3) % | |||
Income before provision for income taxes | 450,578 | 558,160 | (19) % | |||
Provision for income taxes | 113,826 | 137,860 | (17) % | |||
Net income | $ 336,752 | $ 420,300 | (20) % | |||
Weighted average basic shares outstanding | 216,980 | 219,032 | (1) % | |||
Weighted average diluted shares outstanding | 217,403 | 219,581 | (1) % | |||
Earnings per common share – basic | $ 1.55 | $ 1.92 | (19) % | |||
Earnings per common share – diluted | $ 1.55 | $ 1.91 | (19) % | |||
nm = not meaningful | ||||||
Umpqua Holdings Corporation Consolidated Balance Sheets | |||||||||||||
(Unaudited) | |||||||||||||
% Change | |||||||||||||
(In thousands, except per share data) | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Seq. Quarter | Year over Year | ||||||
Assets: | |||||||||||||
Cash and due from banks | $ 327,313 | $ 321,447 | $ 315,348 | $ 307,144 | $ 222,015 | 2 % | 47 % | ||||||
Interest bearing cash and temporary investments | 967,330 | 1,232,412 | 687,233 | 2,358,292 | 2,539,606 | (22) % | (62) % | ||||||
Investment securities: | |||||||||||||
Equity and other, at fair value | 72,959 | 72,277 | 75,347 | 78,966 | 81,214 | 1 % | (10) % | ||||||
Available for sale, at fair value | 3,196,166 | 3,136,391 | 3,416,707 | 3,638,080 | 3,870,435 | 2 % | (17) % | ||||||
Held to maturity, at amortized cost | 2,476 | 2,547 | 2,637 | 2,700 | 2,744 | (3) % | (10) % | ||||||
Loans held for sale | 71,647 | 148,275 | 228,889 | 309,946 | 353,105 | (52) % | (80) % | ||||||
Loans and leases | 26,155,981 | 25,507,951 | 24,432,678 | 22,975,761 | 22,553,180 | 3 % | 16 % | ||||||
Allowance for credit losses on loans and leases | (301,135) | (283,065) | (261,111) | (248,564) | (248,412) | 6 % | 21 % | ||||||
Net loans and leases | 25,854,846 | 25,224,886 | 24,171,567 | 22,727,197 | 22,304,768 | 2 % | 16 % | ||||||
Restricted equity securities | 47,144 | 40,993 | 10,867 | 10,889 | 10,916 | 15 % | 332 % | ||||||
Premises and equipment, net | 176,016 | 165,305 | 165,196 | 167,369 | 171,125 | 6 % | 3 % | ||||||
Operating lease right-of-use assets | 78,598 | 81,729 | 87,249 | 87,333 | 82,366 | (4) % | (5) % | ||||||
Other intangible assets, net | 4,745 | 5,764 | 6,789 | 7,815 | 8,840 | (18) % | (46) % | ||||||
Residential mortgage servicing rights, at fair value | 185,017 | 196,177 | 179,558 | 165,807 | 123,615 | (6) % | 50 % | ||||||
Bank owned life insurance | 331,759 | 329,699 | 328,764 | 328,040 | 327,745 | 1 % | 1 % | ||||||
Deferred tax asset, net | 132,823 | 128,120 | 70,134 | 39,051 | — | 4 % | nm | ||||||
Other assets | 399,800 | 385,938 | 389,409 | 408,497 | 542,442 | 4 % | (26) % | ||||||
Total assets | $ 31,848,639 | $ 31,471,960 | $ 30,135,694 | $ 30,637,126 | $ 30,640,936 | 1 % | 4 % | ||||||
Liabilities: | |||||||||||||
Deposits | $ 27,065,612 | $ 26,817,107 | $ 26,132,423 | $ 26,699,587 | $ 26,594,685 | 1 % | 2 % | ||||||
Securities sold under agreements to repurchase | 308,769 | 383,569 | 527,961 | 499,539 | 492,247 | (20) % | (37) % | ||||||
Borrowings | 906,175 | 756,214 | 6,252 | 6,290 | 6,329 | 20 % | nm | ||||||
Junior subordinated debentures, at fair value | 323,639 | 325,744 | 321,268 | 305,719 | 293,081 | (1) % | 10 % | ||||||
Junior subordinated debentures, at amortized cost | 87,813 | 87,870 | 87,927 | 87,984 | 88,041 | — % | — % | ||||||
Operating lease liabilities | 91,694 | 95,512 | 101,352 | 101,732 | 95,427 | (4) % | (4) % | ||||||
Deferred tax liability, net | — | — | — | — | 4,353 | nm | (100) % | ||||||
Other liabilities | 585,111 | 588,430 | 440,235 | 328,677 | 317,503 | (1) % | 84 % | ||||||
Total liabilities | 29,368,813 | 29,054,446 | 27,617,418 | 28,029,528 | 27,891,666 | 1 % | 5 % | ||||||
Shareholders' equity: | |||||||||||||
Common stock | 3,450,493 | 3,448,007 | 3,445,531 | 3,443,266 | 3,444,849 | — % | — % | ||||||
Accumulated deficit | (543,803) | (580,933) | (619,108) | (651,912) | (697,338) | (6) % | (22) % | ||||||
Accumulated other comprehensive (loss) income | (426,864) | (449,560) | (308,147) | (183,756) | 1,759 | (5) % | nm | ||||||
Total shareholders' equity | 2,479,826 | 2,417,514 | 2,518,276 | 2,607,598 | 2,749,270 | 3 % | (10) % | ||||||
Total liabilities and shareholders' equity | $ 31,848,639 | $ 31,471,960 | $ 30,135,694 | $ 30,637,126 | $ 30,640,936 | 1 % | 4 % | ||||||
Common shares outstanding at period end | 217,054 | 217,053 | 217,049 | 216,967 | 216,626 | — % | — % | ||||||
Book value per common share | $ 11.42 | $ 11.14 | $ 11.60 | $ 12.02 | $ 12.69 | 3 % | (10) % | ||||||
Tangible book value per common share (1) | $ 11.40 | $ 11.11 | $ 11.57 | $ 11.98 | $ 12.65 | 3 % | (10) % | ||||||
Tangible equity - common (1) | $ 2,475,081 | $ 2,411,750 | $ 2,511,487 | $ 2,599,783 | $ 2,740,430 | 3 % | (10) % | ||||||
Tangible common equity to tangible assets (1) | 7.77 % | 7.66 % | 8.34 % | 8.49 % | 8.95 % | 0.11 | (1.18) | ||||||
nm = not meaningful | |||||||||||||
(1) See GAAP to Non-GAAP Reconciliation. |
Umpqua Holdings Corporation | ||||||||||||||
Financial Highlights | ||||||||||||||
(Unaudited) | ||||||||||||||
Quarter Ended | % Change | |||||||||||||
Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Seq. Quarter | Year over Year | ||||||||
Per Common Share Data: | ||||||||||||||
Dividends | $ 0.21 | $ 0.21 | $ 0.21 | $ 0.21 | $ 0.21 | 0 % | 0 % | |||||||
Book value | $ 11.42 | $ 11.14 | $ 11.60 | $ 12.02 | $ 12.69 | 3 % | (10) % | |||||||
Tangible book value (1) | $ 11.40 | $ 11.11 | $ 11.57 | $ 11.98 | $ 12.65 | 3 % | (10) % | |||||||
Tangible book value, ex accumulated other comprehensive income (1) | $ 13.37 | $ 13.18 | $ 12.99 | $ 12.83 | $ 12.64 | 1 % | 6 % | |||||||
Performance Ratios: | ||||||||||||||
Efficiency ratio | 57.24 % | 56.07 % | 59.12 % | 59.02 % | 63.10 % | 1.17 | (5.86) | |||||||
Pre-provision net revenue (PPNR) ROAA (1) | 1.82 % | 1.80 % | 1.64 % | 1.67 % | 1.50 % | 0.02 | 0.32 | |||||||
Return on average assets (ROAA) | 1.04 % | 1.09 % | 1.04 % | 1.21 % | 1.13 % | (0.05) | (0.09) | |||||||
Return on average common equity | 13.50 % | 12.99 % | 12.20 % | 13.62 % | 12.90 % | 0.51 | 0.60 | |||||||
Return on average tangible common equity (1) | 13.53 % | 13.02 % | 12.23 % | 13.66 % | 12.94 % | 0.51 | 0.59 | |||||||
Performance Ratios - Operating: (1) | ||||||||||||||
Operating efficiency ratio (1) | 52.01 % | 51.72 % | 58.27 % | 62.02 % | 59.61 % | 0.29 | (7.60) | |||||||
Operating PPNR return on average assets (1) | 2.10 % | 2.12 % | 1.66 % | 1.43 % | 1.58 % | (0.02) | 0.52 | |||||||
Operating return on average assets (1) | 1.24 % | 1.33 % | 1.06 % | 1.03 % | 1.23 % | (0.09) | 0.01 | |||||||
Operating return on average common equity (1) | 16.14 % | 15.86 % | 12.46 % | 11.58 % | 13.98 % | 0.28 | 2.16 | |||||||
Operating return on average tangible common equity (1) | 16.18 % | 15.90 % | 12.49 % | 11.62 % | 14.03 % | 0.28 | 2.15 | |||||||
Average Balance Sheet Yields, Rates, & Ratios: | ||||||||||||||
Yield on loans and leases | 4.92 % | 4.41 % | 3.94 % | 3.79 % | 3.94 % | 0.51 | 0.98 | |||||||
Yield on earning assets (2) | 4.62 % | 4.10 % | 3.53 % | 3.24 % | 3.25 % | 0.52 | 1.37 | |||||||
Cost of interest bearing deposits | 0.77 % | 0.23 % | 0.11 % | 0.10 % | 0.11 % | 0.54 | 0.66 | |||||||
Cost of interest bearing liabilities | 1.05 % | 0.39 % | 0.20 % | 0.18 % | 0.18 % | 0.66 | 0.87 | |||||||
Cost of total deposits | 0.46 % | 0.14 % | 0.06 % | 0.06 % | 0.06 % | 0.32 | 0.40 | |||||||
Cost of total funding (3) | 0.65 % | 0.23 % | 0.12 % | 0.11 % | 0.11 % | 0.42 | 0.54 | |||||||
Net interest margin (2) | 4.01 % | 3.88 % | 3.41 % | 3.14 % | 3.15 % | 0.13 | 0.86 | |||||||
Average interest bearing cash / Average interest earning assets | 3.62 % | 3.04 % | 5.71 % | 8.92 % | 10.78 % | 0.58 | (7.16) | |||||||
Average loans and leases / Average interest earning assets | 85.32 % | 84.54 % | 80.91 % | 76.85 % | 74.70 % | 0.78 | 10.62 | |||||||
Average loans and leases / Average total deposits | 95.85 % | 93.55 % | 89.23 % | 84.77 % | 82.12 % | 2.30 | 13.73 | |||||||
Average non-interest bearing deposits / Average total deposits | 40.30 % | 42.29 % | 42.00 % | 41.35 % | 41.69 % | (1.99) | (1.39) | |||||||
Average total deposits / Average total funding (3) | 94.52 % | 96.34 % | 96.66 % | 96.82 % | 96.84 % | (1.82) | (2.32) | |||||||
Select Credit & Capital Ratios: | ||||||||||||||
Non-performing loans and leases to total loans and leases | 0.22 % | 0.20 % | 0.18 % | 0.18 % | 0.23 % | 0.02 | (0.01) | |||||||
Non-performing assets to total assets | 0.18 % | 0.16 % | 0.15 % | 0.14 % | 0.17 % | 0.02 | 0.01 | |||||||
Allowance for credit losses to loans and leases | 1.21 % | 1.16 % | 1.12 % | 1.14 % | 1.16 % | 0.05 | 0.05 | |||||||
Total risk-based capital ratio (4) | 13.7 % | 13.2 % | 13.5 % | 14.0 % | 14.3 % | 0.50 | (0.60) | |||||||
Common equity tier 1 risk-based capital ratio (4) | 11.0 % | 10.7 % | 11.0 % | 11.4 % | 11.6 % | 0.30 | (0.60) | |||||||
(1) See GAAP to Non-GAAP Reconciliation. |
(2) Tax exempt interest has been adjusted to a taxable equivalent basis using a 21% tax rate. |
(3) Total funding = Total deposits + Total borrowings. |
(4) Estimated holding company ratios. |
Umpqua Holding Corporation | ||||||
Financial Highlights | ||||||
(Unaudited) | ||||||
Year Ended | % Change | |||||
Dec 31, 2022 | Dec 31, 2021 | Year over Year | ||||
Per Common Share Data: | ||||||
Dividends | $ 0.84 | $ 0.84 | — % | |||
Performance Ratios: | ||||||
Efficiency ratio | 57.83 % | 59.53 % | (1.70) | |||
Pre-provision net revenue (PPNR) ROAA (1) | 1.73 % | 1.70 % | 0.03 | |||
Return on average assets (ROAA) | 1.09 % | 1.39 % | (0.30) | |||
Return on average common equity | 13.07 % | 15.56 % | (2.49) | |||
Return on average tangible common equity (1) | 13.11 % | 15.63 % | (2.52) | |||
Performance Ratios - Operating: (1) | ||||||
Operating efficiency ratio (1) | 55.66 % | 58.30 % | (2.64) | |||
Operating PPNR return on average assets (1) | 1.83 % | 1.73 % | 0.10 | |||
Operating return on average assets (1) | 1.17 % | 1.41 % | (0.24) | |||
Operating return on average common equity (1) | 13.97 % | 15.86 % | (1.89) | |||
Operating return on average tangible common equity (1) | 14.00 % | 15.93 % | (1.93) | |||
Average Balance Sheet Yields, Rates, & Ratios: | ||||||
Yield on loans and leases | 4.29 % | 3.99 % | 0.30 | |||
Yield on earning assets (2) | 3.88 % | 3.33 % | 0.55 | |||
Cost of interest bearing deposits | 0.31 % | 0.18 % | 0.13 | |||
Cost of interest bearing liabilities | 0.47 % | 0.26 % | 0.21 | |||
Cost of total deposits | 0.18 % | 0.10 % | 0.08 | |||
Cost of total funding (3) | 0.28 % | 0.16 % | 0.12 | |||
Net interest margin (2) | 3.62 % | 3.18 % | 0.44 | |||
Average interest bearing cash / Average interest earning assets | 5.28 % | 10.15 % | (4.87) | |||
Average loans and leases / Average interest earning assets | 81.96 % | 75.78 % | 6.18 | |||
Average loans and leases / Average total deposits | 90.91 % | 83.77 % | 7.14 | |||
Average non-interest bearing deposits / Average total deposits | 41.48 % | 40.76 % | 0.72 | |||
Average total deposits / Average total funding (3) | 96.06 % | 96.25 % | (0.19) | |||
(1) See GAAP to Non-GAAP Reconciliation. |
(2) Tax exempt interest has been adjusted to a taxable equivalent basis using a 21% tax rate. |
(3) Total funding = Total deposits + Total borrowings. |
Umpqua Holdings Corporation | ||||||||||||||
Loan & Lease Portfolio | ||||||||||||||
(Unaudited) | ||||||||||||||
Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | % Change | |||||||||
(Dollars in thousands) | Amount | Amount | Amount | Amount | Amount | Seq. Quarter | Year over Year | |||||||
Loans and leases: | ||||||||||||||
Commercial real estate: | ||||||||||||||
Non-owner occupied term, net | $ 3,894,840 | $ 3,846,426 | $ 3,798,242 | $ 3,884,784 | $ 3,786,887 | 1 % | 3 % | |||||||
Owner occupied term, net | 2,567,761 | 2,549,761 | 2,497,553 | 2,327,899 | 2,332,422 | 1 % | 10 % | |||||||
Multifamily, net | 5,285,791 | 5,090,661 | 4,768,273 | 4,323,633 | 4,051,202 | 4 % | 30 % | |||||||
Construction & development, net | 1,077,346 | 1,036,931 | 1,017,297 | 940,286 | 890,338 | 4 % | 21 % | |||||||
Residential development, net | 200,838 | 205,935 | 194,909 | 195,308 | 206,990 | (2) % | (3) % | |||||||
Commercial: | ||||||||||||||
Term, net (1) | 3,029,547 | 3,003,424 | 2,904,861 | 2,772,206 | 3,008,473 | 1 % | 1 % | |||||||
Lines of credit & other, net | 960,054 | 914,507 | 920,604 | 871,483 | 910,733 | 5 % | 5 % | |||||||
Leases & equipment finance, net | 1,706,172 | 1,669,817 | 1,576,144 | 1,484,252 | 1,467,676 | 2 % | 16 % | |||||||
Residential: | ||||||||||||||
Mortgage, net | 5,647,035 | 5,470,624 | 5,168,457 | 4,748,266 | 4,517,266 | 3 % | 25 % | |||||||
Home equity loans & lines, net | 1,631,965 | 1,565,094 | 1,415,722 | 1,250,702 | 1,197,170 | 4 % | 36 % | |||||||
Consumer & other, net | 154,632 | 154,771 | 170,616 | 176,942 | 184,023 | — % | (16) % | |||||||
Total loans and leases, net of deferred fees and costs | $ 26,155,981 | $ 25,507,951 | $ 24,432,678 | $ 22,975,761 | $ 22,553,180 | 3 % | 16 % | |||||||
(1) The Bank participated in the Paycheck Protection Program to originate SBA loans designated to help businesses maintain their workforce and cover other working capital needs during the COVID-19 pandemic. The Commercial Term loans in the table above include the following net PPP loan balances: | ||||||||||||||
Net PPP loan balance | $ 24,420 | $ 37,949 | $ 101,554 | $ 172,790 | $ 380,440 | (36) % | (94) % | |||||||
Loan and leases mix: | ||||||||||||||
Commercial real estate: | ||||||||||||||
Non-owner occupied term, net | 15 % | 15 % | 15 % | 17 % | 17 % | |||||||||
Owner occupied term, net | 10 % | 10 % | 10 % | 10 % | 10 % | |||||||||
Multifamily, net | 20 % | 20 % | 20 % | 19 % | 18 % | |||||||||
Construction & development, net | 4 % | 4 % | 4 % | 4 % | 4 % | |||||||||
Residential development, net | 1 % | 1 % | 1 % | 1 % | 1 % | |||||||||
Commercial: | ||||||||||||||
Term, net | 12 % | 12 % | 12 % | 12 % | 13 % | |||||||||
Lines of credit & other, net | 4 % | 4 % | 4 % | 4 % | 4 % | |||||||||
Leases & equipment finance, net | 6 % | 6 % | 6 % | 6 % | 7 % | |||||||||
Residential: | ||||||||||||||
Mortgage, net | 21 % | 21 % | 21 % | 21 % | 20 % | |||||||||
Home equity loans & lines, net | 6 % | 6 % | 6 % | 5 % | 5 % | |||||||||
Consumer & other, net | 1 % | 1 % | 1 % | 1 % | 1 % | |||||||||
Total | 100 % | 100 % | 100 % | 100 % | 100 % | |||||||||
Umpqua Holdings Corporation | ||||||||||||||
Deposits by Type/Core Deposits | ||||||||||||||
(Unaudited) | ||||||||||||||
Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | % Change | |||||||||
(Dollars in thousands) | Amount | Amount | Amount | Amount | Amount | Seq. Quarter | Year over Year | |||||||
Deposits: | ||||||||||||||
Demand, non-interest bearing | $ 10,288,849 | $ 11,246,358 | $ 11,129,209 | $ 11,058,251 | $ 11,023,724 | (9) % | (7) % | |||||||
Demand, interest bearing | 4,080,469 | 3,903,746 | 3,723,650 | 3,955,329 | 3,774,937 | 5 % | 8 % | |||||||
Money market | 7,721,011 | 7,601,506 | 7,284,641 | 7,572,581 | 7,611,718 | 2 % | 1 % | |||||||
Savings | 2,265,052 | 2,455,917 | 2,446,876 | 2,429,073 | 2,375,723 | (8) % | (5) % | |||||||
Time | 2,710,231 | 1,609,580 | 1,548,047 | 1,684,353 | 1,808,583 | 68 % | 50 % | |||||||
Total | $ 27,065,612 | $ 26,817,107 | $ 26,132,423 | $ 26,699,587 | $ 26,594,685 | 1 % | 2 % | |||||||
Total core deposits (1) | $ 25,616,010 | $ 26,292,548 | $ 25,619,500 | $ 26,140,993 | $ 25,964,358 | (3) % | (1) % | |||||||
Deposit mix: | ||||||||||||||
Demand, non-interest bearing | 38 % | 42 % | 43 % | 42 % | 41 % | |||||||||
Demand, interest bearing | 15 % | 15 % | 14 % | 15 % | 14 % | |||||||||
Money market | 29 % | 28 % | 28 % | 28 % | 29 % | |||||||||
Savings | 8 % | 9 % | 9 % | 9 % | 9 % | |||||||||
Time | 10 % | 6 % | 6 % | 6 % | 7 % | |||||||||
Total | 100 % | 100 % | 100 % | 100 % | 100 % | |||||||||
Number of open accounts: | ||||||||||||||
Demand, non-interest bearing | 430,568 | 434,347 | 434,436 | 428,915 | 428,181 | |||||||||
Demand, interest bearing | 57,391 | 56,698 | 57,145 | 63,800 | 66,010 | |||||||||
Money market | 55,222 | 55,712 | 56,430 | 56,783 | 57,222 | |||||||||
Savings | 157,216 | 159,008 | 159,709 | 160,267 | 160,449 | |||||||||
Time | 37,424 | 32,202 | 32,103 | 34,127 | 35,665 | |||||||||
Total | 737,821 | 737,967 | 739,823 | 743,892 | 747,527 | |||||||||
Average balance per account: | ||||||||||||||
Demand, non-interest bearing | $ 23.9 | $ 25.9 | $ 25.6 | $ 25.8 | $ 25.7 | |||||||||
Demand, interest bearing | 71.1 | 68.9 | 65.2 | 62.0 | 57.2 | |||||||||
Money market | 139.8 | 136.4 | 129.1 | 133.4 | 133.0 | |||||||||
Savings | 14.4 | 15.4 | 15.3 | 15.2 | 14.8 | |||||||||
Time | 72.4 | 50.0 | 48.2 | 49.4 | 50.7 | |||||||||
Total | $ 36.7 | $ 36.3 | $ 35.3 | $ 35.9 | $ 35.6 | |||||||||
(1) Core deposits are defined as total deposits less time deposits greater than $250,000 and all brokered deposits. |
Umpqua Holdings Corporation | ||||||||||||||
Credit Quality – Non-performing Assets | ||||||||||||||
(Unaudited) | ||||||||||||||
Quarter Ended | % Change | |||||||||||||
(Dollars in thousands) | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Seq. Quarter | Year over Year | |||||||
Non-performing assets: | ||||||||||||||
Loans and leases on non-accrual status | ||||||||||||||
Commercial real estate, net | $ 5,011 | $ 5,403 | $ 5,514 | $ 5,950 | $ 5,767 | (7) % | (13) % | |||||||
Commercial, net | 25,691 | 18,652 | 12,645 | 12,415 | 13,098 | 38 % | 96 % | |||||||
Residential, net | — | — | — | — | — | nm | nm | |||||||
Consumer & other, net | — | — | — | — | — | nm | nm | |||||||
Total loans and leases on non-accrual status | 30,702 | 24,055 | 18,159 | 18,365 | 18,865 | 28 % | 63 % | |||||||
Loans and leases past due 90+ days and accruing (1) | ||||||||||||||
Commercial real estate, net | 1 | 1 | 23 | 1 | 1 | — % | — % | |||||||
Commercial, net | 7,909 | 5,143 | 3,311 | 8 | 4,160 | 54 % | 90 % | |||||||
Residential, net (1) | 19,894 | 21,411 | 22,340 | 23,162 | 27,981 | (7) % | (29) % | |||||||
Consumer & other, net | 134 | 152 | 196 | 111 | 194 | (12) % | (31) % | |||||||
Total loans and leases past due 90+ days and accruing (1) | 27,938 | 26,707 | 25,870 | 23,282 | 32,336 | 5 % | (14) % | |||||||
Total non-performing loans and leases | 58,640 | 50,762 | 44,029 | 41,647 | 51,201 | 16 % | 15 % | |||||||
Other real estate owned | 203 | — | 1,868 | 1,868 | 1,868 | nm | (89) % | |||||||
Total non-performing assets | $ 58,843 | $ 50,762 | $ 45,897 | $ 43,515 | $ 53,069 | 16 % | 11 % | |||||||
Performing restructured loans and leases | $ 6,767 | $ 7,076 | $ 7,631 | $ 8,405 | $ 6,694 | (4) % | 1 % | |||||||
Loans and leases past due 31-89 days | $ 64,893 | $ 53,538 | $ 34,659 | $ 42,409 | $ 31,680 | 21 % | 105 % | |||||||
Loans and leases past due 31-89 days to total loans and leases | 0.25 % | 0.21 % | 0.14 % | 0.18 % | 0.14 % | 0.04 | 0.11 | |||||||
Non-performing loans and leases to total loans and leases (1) | 0.22 % | 0.20 % | 0.18 % | 0.18 % | 0.23 % | 0.02 | (0.01) | |||||||
Non-performing assets to total assets (1) | 0.18 % | 0.16 % | 0.15 % | 0.14 % | 0.17 % | 0.02 | 0.01 | |||||||
nm = not meaningful | ||||||||||||||
(1) Excludes certain mortgage loans guaranteed by Ginnie Mae, which Umpqua has the unilateral right to repurchase but has not done so, totaling $6.6 million, $1.0 million, and $356,000 at December 31, 2022, September 30, 2022, and June 30, 2022, respectively. |
Umpqua Holdings Corporation | |||||||||||||||
Credit Quality – Allowance for Credit Losses | |||||||||||||||
(Unaudited) | |||||||||||||||
Quarter Ended | % Change | ||||||||||||||
(Dollars in thousands) | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Seq. Quarter | Year over Year | ||||||||
Allowance for credit losses on loans and leases (ACLLL) | |||||||||||||||
Balance, beginning of period | $ 283,065 | $ 261,111 | $ 248,564 | $ 248,412 | $ 257,560 | 8 % | 10 % | ||||||||
Provision (recapture) for credit losses on loans and leases | 30,580 | 28,542 | 18,787 | 5,696 | (1,751) | 7 % | nm | ||||||||
Charge-offs | |||||||||||||||
Commercial real estate, net | (128) | — | (8) | — | (58) | nm | 121 % | ||||||||
Commercial, net | (14,721) | (9,459) | (9,035) | (7,858) | (10,197) | 56 % | 44 % | ||||||||
Residential, net | (53) | (4) | — | (167) | — | nm | nm | ||||||||
Consumer & other, net | (906) | (929) | (836) | (885) | (675) | (2) % | 34 % | ||||||||
Total charge-offs | (15,808) | (10,392) | (9,879) | (8,910) | (10,930) | 52 % | 45 % | ||||||||
Recoveries | |||||||||||||||
Commercial real estate, net | 163 | 123 | 73 | 25 | 56 | 33 % | 191 % | ||||||||
Commercial, net | 2,708 | 2,842 | 2,934 | 2,545 | 2,585 | (5) % | 5 % | ||||||||
Residential, net | 24 | 249 | 216 | 173 | 326 | (90) % | (93) % | ||||||||
Consumer & other, net | 403 | 590 | 416 | 623 | 566 | (32) % | (29) % | ||||||||
Total recoveries | 3,298 | 3,804 | 3,639 | 3,366 | 3,533 | (13) % | (7) % | ||||||||
Net (charge-offs) recoveries | |||||||||||||||
Commercial real estate, net | 35 | 123 | 65 | 25 | (2) | (72) % | nm | ||||||||
Commercial, net | (12,013) | (6,617) | (6,101) | (5,313) | (7,612) | 82 % | 58 % | ||||||||
Residential, net | (29) | 245 | 216 | 6 | 326 | (112) % | (109) % | ||||||||
Consumer & other, net | (503) | (339) | (420) | (262) | (109) | 48 % | 361 % | ||||||||
Total charge-offs | (12,510) | (6,588) | (6,240) | (5,544) | (7,397) | 90 % | 69 % | ||||||||
Balance, end of period | $ 301,135 | $ 283,065 | $ 261,111 | $ 248,564 | $ 248,412 | 6 % | 21 % | ||||||||
Reserve for unfunded commitments | |||||||||||||||
Balance, beginning of period | $ 11,853 | $ 12,823 | $ 12,918 | $ 12,767 | $ 11,752 | (8) % | 1 % | ||||||||
Provision (recapture) for credit losses on unfunded commitments | 2,368 | (970) | (95) | 151 | 1,015 | nm | 133 % | ||||||||
Balance, end of period | 14,221 | 11,853 | 12,823 | 12,918 | 12,767 | 20 % | 11 % | ||||||||
Total Allowance for credit losses (ACL) | $ 315,356 | $ 294,918 | $ 273,934 | $ 261,482 | $ 261,179 | 7 % | 21 % | ||||||||
Net charge-offs to average loans and leases (annualized) | 0.19 % | 0.11 % | 0.11 % | 0.10 % | 0.13 % | 0.08 | 0.06 | ||||||||
Recoveries to gross charge-offs | 20.86 % | 36.61 % | 36.84 % | 37.78 % | 32.32 % | (15.75) | (11.46) | ||||||||
ACLLL to loans and leases | 1.15 % | 1.11 % | 1.07 % | 1.08 % | 1.10 % | 0.04 | 0.05 | ||||||||
ACL to loans and leases | 1.21 % | 1.16 % | 1.12 % | 1.14 % | 1.16 % | 0.05 | 0.05 | ||||||||
Umpqua Holdings Corporation | |||||||
Credit Quality – Allowance for Credit Losses | |||||||
(Unaudited) | |||||||
Year Ended | % Change | ||||||
(Dollars in thousands) | Dec 31, 2022 | Dec 31, 2021 | Year over Year | ||||
Allowance for credit losses on loans and leases (ACLLL) | |||||||
Balance, beginning of period | $ 248,412 | $ 328,401 | (24) % | ||||
Provision (recapture) for credit losses on loans and leases | 83,605 | (35,132) | nm | ||||
Charge-offs | |||||||
Commercial real estate, net | (136) | (1,144) | (88) % | ||||
Commercial, net | (41,073) | (54,425) | (25) % | ||||
Residential, net | (224) | (70) | 220 % | ||||
Consumer & other, net | (3,556) | (3,658) | (3) % | ||||
Total charge-offs | (44,989) | (59,297) | (24) % | ||||
Recoveries | |||||||
Commercial real estate, net | 384 | 645 | (40) % | ||||
Commercial, net | 11,029 | 10,703 | 3 % | ||||
Residential, net | 662 | 924 | (28) % | ||||
Consumer & other, net | 2,032 | 2,168 | (6) % | ||||
Total recoveries | 14,107 | 14,440 | (2) % | ||||
Net (charge-offs) recoveries | |||||||
Commercial real estate, net | 248 | (499) | nm | ||||
Commercial, net | (30,044) | (43,722) | (31) % | ||||
Residential, net | 438 | 854 | (49) % | ||||
Consumer & other, net | (1,524) | (1,490) | 2 % | ||||
Total charge-offs | (30,882) | (44,857) | (31) % | ||||
Balance, end of period | $ 301,135 | $ 248,412 | 21 % | ||||
Reserve for unfunded commitments | |||||||
Balance, beginning of period | $ 12,767 | $ 20,286 | (37) % | ||||
Provision (recapture) for credit losses on unfunded commitments | 1,454 | (7,519) | nm | ||||
Balance, end of period | 14,221 | 12,767 | 11 % | ||||
Total Allowance for credit losses (ACL) | $ 315,356 | $ 261,179 | 21 % | ||||
Net charge-offs to average loans and leases | 0.13 % | 0.20 % | (0.07) | ||||
Recoveries to gross charge-offs | 31.36 % | 24.35 % | 7.01 | ||||
nm = not meaningful | |||||||
Umpqua Holdings Corporation | |||||||||||||||||
(Unaudited) | |||||||||||||||||
Quarter Ended | |||||||||||||||||
December 31, 2022 | September 30, 2022 | December 31, 2021 | |||||||||||||||
(Dollars in thousands) | Average Balance | Interest Income or Expense | Average Yields or Rates | Average Balance | Interest Income or Expense | Average Yields or Rates | Average Balance | Interest Income or Expense | Average Yields or Rates | ||||||||
INTEREST-EARNING ASSETS: | |||||||||||||||||
Loans held for sale | $ 110,850 | $ 1,603 | 5.79 % | $ 173,397 | $ 2,205 | 5.09 % | $ 366,043 | $ 2,907 | 3.18 % | ||||||||
Loans and leases (1) | 25,855,556 | 320,747 | 4.92 % | 24,886,203 | 276,625 | 4.41 % | 22,098,818 | 218,594 | 3.94 % | ||||||||
Taxable securities | 3,042,044 | 18,290 | 2.40 % | 3,271,185 | 18,261 | 2.23 % | 3,681,650 | 16,668 | 1.81 % | ||||||||
Non-taxable securities (2) | 200,825 | 1,571 | 3.13 % | 212,847 | 1,651 | 3.10 % | 247,183 | 1,831 | 2.96 % | ||||||||
Temporary investments and interest-bearing cash | 1,095,854 | 10,319 | 3.74 % | 893,471 | 5,115 | 2.27 % | 3,190,380 | 1,229 | 0.15 % | ||||||||
Total interest-earning assets | 30,305,129 | $ 352,530 | 4.62 % | 29,437,103 | $ 303,857 | 4.10 % | 29,584,074 | $ 241,229 | 3.25 % | ||||||||
Other assets | 1,332,361 | 1,231,074 | 1,302,304 | ||||||||||||||
Total assets | $ 31,637,490 | $ 30,668,177 | $ 30,886,378 | ||||||||||||||
INTEREST-BEARING LIABILITIES: | |||||||||||||||||
Interest-bearing demand deposits | $ 4,005,643 | $ 5,372 | 0.53 % | $ 3,829,688 | $ 1,705 | 0.18 % | $ 3,765,212 | $ 524 | 0.06 % | ||||||||
Money market deposits | 7,651,974 | 17,473 | 0.91 % | 7,550,791 | 5,817 | 0.31 % | 7,717,844 | 1,448 | 0.07 % | ||||||||
Savings deposits | 2,345,564 | 226 | 0.04 % | 2,468,187 | 250 | 0.04 % | 2,342,865 | 206 | 0.03 % | ||||||||
Time deposits | 2,100,803 | 8,103 | 1.53 % | 1,501,724 | 1,318 | 0.35 % | 1,864,949 | 2,179 | 0.46 % | ||||||||
Total interest-bearing deposits | 16,103,984 | 31,174 | 0.77 % | 15,350,390 | 9,090 | 0.23 % | 15,690,870 | 4,357 | 0.11 % | ||||||||
Repurchase agreements and federal funds purchased | 354,624 | 323 | 0.36 % | 509,559 | 545 | 0.42 % | 484,891 | 48 | 0.04 % | ||||||||
Borrowings | 796,414 | 8,023 | 4.00 % | 90,475 | 798 | 3.50 % | 6,353 | 51 | 3.19 % | ||||||||
Junior subordinated debentures | 413,708 | 7,248 | 6.95 % | 409,151 | 5,491 | 5.33 % | 387,471 | 3,019 | 3.09 % | ||||||||
Total interest-bearing liabilities | 17,668,730 | $ 46,768 | 1.05 % | 16,359,575 | $ 15,924 | 0.39 % | 16,569,585 | $ 7,475 | 0.18 % | ||||||||
Non-interest-bearing deposits | 10,870,842 | 11,250,764 | 11,219,766 | ||||||||||||||
Other liabilities | 659,279 | 490,572 | 379,274 | ||||||||||||||
Total liabilities | 29,198,851 | 28,100,911 | 28,168,625 | ||||||||||||||
Common equity | 2,438,639 | 2,567,266 | 2,717,753 | ||||||||||||||
Total liabilities and shareholders' equity | $ 31,637,490 | $ 30,668,177 | $ 30,886,378 | ||||||||||||||
NET INTEREST INCOME | $ 305,762 | $ 287,933 | $ 233,754 | ||||||||||||||
NET INTEREST SPREAD | 3.57 % | 3.71 % | 3.07 % | ||||||||||||||
NET INTEREST INCOME TO EARNING ASSETS OR NET INTEREST MARGIN (1), (2) | 4.01 % | 3.88 % | 3.15 % | ||||||||||||||
(1) Non-accrual loans and leases are included in the average balance. |
(2) Tax-exempt income has been adjusted to a tax equivalent basis at a 21% tax rate. The amount of such adjustment was an addition to recorded income of approximately $283,000 for the three months ended December 31, 2022 as compared to $329,000 for the three months ended September 30, 2022 and $375,000 for the three months ended December 31, 2021. |
Umpqua Holdings Corporation Average Rates and Balances | |||||||||||
(Unaudited) | |||||||||||
Year Ended | |||||||||||
December 31, 2022 | December 31, 2021 | ||||||||||
(Dollars in thousands) | Average Balance | Interest Income or Expense | Average Yields or Rates | Average Balance | Interest Income or Expense | Average Yields or Rates | |||||
INTEREST-EARNING ASSETS: | |||||||||||
Loans held for sale | $ 208,141 | $ 8,812 | 4.23 % | $ 500,070 | $ 15,149 | 3.03 % | |||||
Loans and leases (1) | 24,225,518 | 1,041,446 | 4.29 % | 21,925,108 | 875,366 | 3.99 % | |||||
Taxable securities | 3,343,721 | 72,702 | 2.17 % | 3,321,142 | 61,717 | 1.86 % | |||||
Non-taxable securities (2) | 216,943 | 6,669 | 3.07 % | 248,256 | 7,458 | 3.00 % | |||||
Temporary investments and interest-bearing cash | 1,561,808 | 19,706 | 1.26 % | 2,936,273 | 3,864 | 0.13 % | |||||
Total interest-earning assets | 29,556,131 | $ 1,149,335 | 3.88 % | 28,930,849 | $ 963,554 | 3.33 % | |||||
Other assets | 1,261,265 | 1,336,523 | |||||||||
Total assets | $ 30,817,396 | $ 30,267,372 | |||||||||
INTEREST-BEARING LIABILITIES: | |||||||||||
Interest-bearing demand deposits | $ 3,886,390 | $ 8,185 | 0.21 % | $ 3,462,035 | $ 1,865 | 0.05 % | |||||
Money market deposits | 7,552,666 | 26,415 | 0.35 % | 7,624,707 | 5,964 | 0.08 % | |||||
Savings deposits | 2,411,448 | 880 | 0.04 % | 2,200,608 | 729 | 0.03 % | |||||
Time deposits | 1,743,988 | 12,715 | 0.73 % | 2,217,464 | 18,593 | 0.84 % | |||||
Total interest-bearing deposits | 15,594,492 | 48,195 | 0.31 % | 15,504,814 | 27,151 | 0.18 % | |||||
Repurchase agreements and federal funds purchased | 465,600 | 997 | 0.21 % | 454,994 | 280 | 0.06 % | |||||
Borrowings | 226,665 | 8,920 | 3.94 % | 195,985 | 2,838 | 1.45 % | |||||
Junior subordinated debentures | 399,568 | 19,889 | 4.98 % | 369,259 | 12,127 | 3.28 % | |||||
Total interest-bearing liabilities | 16,686,325 | $ 78,001 | 0.47 % | 16,525,052 | $ 42,396 | 0.26 % | |||||
Non-interest-bearing deposits | 11,053,921 | 10,669,531 | |||||||||
Other liabilities | 501,573 | 372,078 | |||||||||
Total liabilities | 28,241,819 | 27,566,661 | |||||||||
Common equity | 2,575,577 | 2,700,711 | |||||||||
Total liabilities and shareholders' equity | $ 30,817,396 | $ 30,267,372 | |||||||||
NET INTEREST INCOME | $ 1,071,334 | $ 921,158 | |||||||||
NET INTEREST SPREAD | 3.41 % | 3.07 % | |||||||||
NET INTEREST INCOME TO EARNING ASSETS OR NET INTEREST MARGIN (1), (2) | 3.62 % | 3.18 % | |||||||||
Umpqua Holdings Corporation Segments | ||||||||||||||
(Unaudited) | ||||||||||||||
Core Banking | Quarter Ended | % Change | ||||||||||||
(Dollars in thousands) | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Seq. Quarter | Year over Year | |||||||
Net interest income | $ 305,030 | $ 286,532 | $ 247,009 | $ 227,087 | $ 231,250 | 6 % | 32 % | |||||||
Provision (recapture) for credit losses | 32,948 | 27,572 | 18,692 | 4,804 | (736) | 19 % | nm | |||||||
Non-interest income | ||||||||||||||
Gain on sale of debt securities, net | — | — | — | 2 | 4 | nm | (100) % | |||||||
Gain (loss) on equity securities, net | 284 | (2,647) | (2,075) | (2,661) | (466) | nm | nm | |||||||
(Loss) gain on swap derivatives, net | (2,329) | 4,194 | 7,337 | 7,047 | (303) | (156) % | nm | |||||||
Change in fair value of certain loans held for investment | 4,192 | (26,397) | (15,210) | (21,049) | (2,672) | nm | nm | |||||||
Non-interest income (excluding above items) | 34,362 | 36,769 | 34,461 | 35,650 | 42,812 | (7) % | (20) % | |||||||
Total non-interest income | 36,509 | 11,919 | 24,513 | 18,989 | 39,375 | 206 % | (7) % | |||||||
Non-interest expense | ||||||||||||||
Merger related expenses | 11,637 | 769 | 2,672 | 2,278 | 15,183 | nm | (23) % | |||||||
Exit and disposal costs | 1,966 | 1,364 | 442 | 3,033 | 3,022 | 44 % | (35) % | |||||||
Non-interest expense (excluding above items) | 167,267 | 154,320 | 148,946 | 148,423 | 150,587 | 8 % | 11 % | |||||||
Allocated expenses, net (1) | (1,905) | (39) | 3,702 | 3,735 | 4,314 | nm | (144) % | |||||||
Total non-interest expense | 178,965 | 156,414 | 155,762 | 157,469 | 173,106 | 14 % | 3 % | |||||||
Income before income taxes | 129,626 | 114,465 | 97,068 | 83,803 | 98,255 | 13 % | 32 % | |||||||
Provision for income taxes | 33,763 | 28,212 | 24,530 | 20,917 | 24,067 | 20 % | 40 % | |||||||
Net income | $ 95,863 | $ 86,253 | $ 72,538 | $ 62,886 | $ 74,188 | 11 % | 29 % | |||||||
Effective Tax Rate | 26 % | 25 % | 25 % | 25 % | 24 % | |||||||||
Efficiency Ratio | 52 % | 52 % | 57 % | 64 % | 64 % | |||||||||
Total assets | $ 31,577,603 | $ 31,100,700 | $ 29,721,590 | $ 30,153,079 | $ 30,155,058 | 2 % | 5 % | |||||||
Total loans and leases | $ 26,155,981 | $ 25,507,951 | $ 24,432,678 | $ 22,975,761 | $ 22,553,180 | 3 % | 16 % | |||||||
Total deposits | $ 26,937,431 | $ 26,588,217 | $ 25,925,294 | $ 26,479,078 | $ 26,370,568 | 1 % | 2 % | |||||||
Key Rates, end of period: | ||||||||||||||
10 year CMT | 3.88 % | 3.83 % | 2.98 % | 2.32 % | 1.52 % | 0.05 | 2.36 | |||||||
FHLMC 30 year fixed | 6.42 % | 6.70 % | 5.70 % | 4.67 % | 3.11 % | (0.28) | 3.31 | |||||||
nm = not meaningful | ||||||||||||||
(1) Represents the internal charges for centrally provided support services and other corporate overhead to the Mortgage Banking segment, partially offset by allocations from the Mortgage Banking segment to Core Banking for new portfolio loan originations and portfolio servicing costs. | ||||||||||||||
Umpqua Holdings Corporation Segments - Continued | ||||||||||||||
(Unaudited) | ||||||||||||||
Mortgage Banking | Quarter Ended | % Change | ||||||||||||
(Dollars in thousands) | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Seq. Quarter | Year over Year | |||||||
Net interest income | $ 449 | $ 1,072 | $ 1,161 | $ 1,676 | $ 2,129 | (58) % | (79) % | |||||||
Provision for credit losses | — | — | — | — | — | nm | nm | |||||||
Non-interest income | ||||||||||||||
Residential mortgage banking revenue: | ||||||||||||||
Origination and sale | 4,252 | 10,515 | 15,101 | 16,844 | 23,624 | (60) % | (82) % | |||||||
Servicing | 9,184 | 9,529 | 9,505 | 9,140 | 9,457 | (4) % | (3) % | |||||||
Change in fair value of MSR asset: | ||||||||||||||
Changes due to collection/realization of expected cash flows over time | (4,986) | (4,978) | (4,961) | (5,347) | (5,311) | — % | (6) % | |||||||
Changes due to valuation inputs or assumptions | (9,914) | 16,403 | 10,899 | 40,149 | 15,415 | (160) % | (164) % | |||||||
MSR hedge loss | (348) | (14,128) | — | — | — | (98) % | nm | |||||||
Non-interest income (excluding above items) | 182 | 185 | 178 | 194 | 178 | (2) % | 2 % | |||||||
Total non-interest income | (1,630) | 17,526 | 30,722 | 60,980 | 43,363 | (109) % | (104) % | |||||||
Non-interest expense | ||||||||||||||
Non-interest expense | 14,112 | 21,511 | 27,514 | 28,696 | 30,919 | (34) % | (54) % | |||||||
Allocated expenses, net(1) | 1,905 | 39 | (3,702) | (3,735) | (4,314) | nm | nm | |||||||
Total non-interest expense | 16,017 | 21,550 | 23,812 | 24,961 | 26,605 | (26) % | (40) % | |||||||
Income before income taxes | (17,198) | (2,952) | 8,071 | 37,695 | 18,887 | 483 % | (191) % | |||||||
Provision for income taxes | (4,299) | (739) | 2,018 | 9,424 | 4,721 | 482 % | (191) % | |||||||
Net income | $ (12,899) | $ (2,213) | $ 6,053 | $ 28,271 | $ 14,166 | 483 % | (191) % | |||||||
Effective Tax Rate | 25 % | 25 % | 25 % | 25 % | 25 % | |||||||||
Efficiency Ratio | nm | 116 % | 75 % | 40 % | 58 % | |||||||||
Total assets | $ 271,036 | $ 371,260 | $ 414,104 | $ 484,047 | $ 485,878 | (27) % | (44) % | |||||||
Loans held for sale | $ 71,647 | $ 148,275 | $ 228,889 | $ 309,946 | $ 353,105 | (52) % | (80) % | |||||||
Total deposits | $ 128,181 | $ 228,890 | $ 207,129 | $ 220,509 | $ 224,117 | (44) % | (43) % | |||||||
LHFS Production Statistics: | ||||||||||||||
Closed loan volume for-sale | $ 216,833 | $ 396,979 | $ 576,532 | $ 649,122 | $ 871,268 | (45) % | (75) % | |||||||
Gain on sale margin | 1.96 % | 2.65 % | 2.62 % | 2.59 % | 2.71 % | |||||||||
Direct LHFS expense | $ 7,292 | $ 10,465 | $ 13,197 | $ 14,296 | $ 18,150 | (30) % | (60) % | |||||||
Direct LHFS expenses as % of volume | 3.36 % | 2.64 % | 2.29 % | 2.20 % | 2.08 % | |||||||||
MSR Statistics: | ||||||||||||||
Residential mortgage loans serviced for others | $ 13,020,189 | $ 12,997,911 | $ 12,932,747 | $ 12,810,574 | $ 12,755,671 | — % | 2 % | |||||||
MSR, net | $ 185,017 | $ 196,177 | $ 179,558 | $ 165,807 | $ 123,615 | (6) % | 50 % | |||||||
MSR as % of serviced portfolio | 1.42 % | 1.51 % | 1.39 % | 1.29 % | 0.97 % | (0.09) | 0.45 | |||||||
Key Rates, end of period: | ||||||||||||||
10 year CMT | 3.88 % | 3.83 % | 2.98 % | 2.32 % | 1.52 % | 0.05 | 2.36 | |||||||
FHLMC 30 year fixed | 6.42 % | 6.70 % | 5.70 % | 4.67 % | 3.11 % | (0.28) | 3.31 | |||||||
nm = not meaningful | ||||||||||||||
(1) | Represents the internal charges for centrally provided support services and other corporate overhead to the Mortgage Banking segment, partially offset by allocations from the Mortgage Banking segment to Core Banking for new portfolio loan originations and portfolio servicing costs. |
Umpqua Holdings Corporation Segments | ||||||||||||
(Unaudited) | ||||||||||||
Core Banking | Mortgage Banking | |||||||||||
Year Ended | % Change | Year Ended | % Change | |||||||||
(Dollars in thousands) | Dec 31, 2022 | Dec 31, 2021 | Year over Year | Dec 31, 2022 | Dec 31, 2021 | Year over Year | ||||||
Net interest income | $ 1,065,658 | $ 908,087 | 17 % | $ 4,358 | $ 11,560 | (62) % | ||||||
Provision (recapture) for credit losses | 84,016 | (42,651) | nm | — | — | nm | ||||||
Non-interest income | ||||||||||||
Residential mortgage banking revenue: | ||||||||||||
Origination and sale | — | — | nm | 46,712 | 157,789 | (70) % | ||||||
Servicing | — | — | nm | 37,358 | 36,836 | 1 % | ||||||
Change in fair value of MSR asset: | ||||||||||||
Changes due to collection/realization of expected cash flows over time | — | — | nm | (20,272) | (18,903) | 7 % | ||||||
Changes due to valuation inputs or assumptions | — | — | nm | 57,537 | 11,089 | 419 % | ||||||
MSR hedge loss | — | — | nm | (14,476) | — | nm | ||||||
Gain on sale of debt securities, net | 2 | 8 | (75) % | — | — | nm | ||||||
Loss on equity securities, net | (7,099) | (1,511) | 370 % | — | — | nm | ||||||
Gain on swap derivatives, net | 16,249 | 8,395 | 94 % | — | — | nm | ||||||
Change in fair value of certain loans held for investment | (58,464) | 3,032 | nm | — | — | nm | ||||||
Non-interest income (excluding above items) | 141,242 | 158,725 | (11) % | 739 | 858 | (14) % | ||||||
Total non-interest income | 91,930 | 168,649 | (45) % | 107,598 | 187,669 | (43) % | ||||||
Non-interest expense | ||||||||||||
Merger related expenses | 17,356 | 15,183 | 14 % | — | — | nm | ||||||
Exit and disposal costs | 6,805 | 12,763 | (47) % | — | — | nm | ||||||
Non-interest expense (excluding above items) | 618,956 | 589,556 | 5 % | 91,833 | 142,954 | (36) % | ||||||
Allocated expenses, net (1) | 5,493 | 8,174 | (33) % | (5,493) | (8,174) | (33) % | ||||||
Total non-interest expense | 648,610 | 625,676 | 4 % | 86,340 | 134,780 | (36) % | ||||||
Income before income taxes | 424,962 | 493,711 | (14) % | 25,616 | 64,449 | (60) % | ||||||
Provision for income taxes | 107,422 | 121,748 | (12) % | 6,404 | 16,112 | (60) % | ||||||
Net income | $ 317,540 | $ 371,963 | (15) % | $ 19,212 | $ 48,337 | (60) % | ||||||
Effective Tax Rate | 25 % | 25 % | — | 25 % | 25 % | — | ||||||
Efficiency Ratio | 56 % | 58 % | (2.00) | 77 % | 68 % | 9.00 | ||||||
LHFS Production Statistics: | ||||||||||||
Closed loan volume for-sale | $ 1,839,466 | $ 4,747,104 | (61) % | |||||||||
Gain on sale margin | 2.54 % | 3.32 % | (0.78) | |||||||||
Direct LHFS expense | $ 45,250 | $ 94,718 | (52) % | |||||||||
Direct LHFS expenses as % of volume | 2.46 % | 2.00 % | 0.46 | |||||||||
nm = not meaningful | ||||||||||||
(1) | Represents the internal charge of centrally provided support services and other corporate overhead to the Mortgage Banking segment, partially offset by allocations from the Mortgage Banking segment to Core Banking for new portfolio loan originations and portfolio servicing costs. |
Non-GAAP Financial Measures
In addition to results presented in accordance with generally accepted accounting principles in the United States of America (GAAP), this press release contains certain non-GAAP financial measures. The company believes presenting certain non-GAAP financial measures provides investors with information useful in understanding our financial performance, our performance trends, and our financial position. We utilize these measures for internal planning and forecasting purposes. We, as well as securities analysts, investors, and other interested parties, also use these measures to compare peer company operating performance. We believe that our presentation and discussion, together with the accompanying reconciliations, provides a complete understanding of factors and trends affecting our business and allows investors to view performance in a manner similar to management. These non-GAAP measures should not be considered a substitution for GAAP basis measures and results, and we strongly encourage investors to review our consolidated financial statements in their entirety and not to rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names.
Umpqua Holdings Corporation GAAP to Non-GAAP Reconciliation | |||||||||||||||
(Unaudited) | |||||||||||||||
Quarter Ended | % Change | ||||||||||||||
(Dollars in thousands, except per share | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Seq. Quarter | Year over Year | ||||||||
Total shareholders' equity | a | $ 2,479,826 | $ 2,417,514 | $ 2,518,276 | $ 2,607,598 | $ 2,749,270 | 3 % | (10) % | |||||||
Less: Other intangible assets, net | 4,745 | 5,764 | 6,789 | 7,815 | 8,840 | (18) % | (46) % | ||||||||
Tangible common shareholders' equity | b | $ 2,475,081 | $ 2,411,750 | $ 2,511,487 | $ 2,599,783 | $ 2,740,430 | 3 % | (10) % | |||||||
Less: Accumulated other comprehensive income (AOCI) | $ (426,864) | (449,560) | (308,147) | (183,756) | 1,759 | (5) % | nm | ||||||||
Tangible common shareholders' equity, ex AOCI | c | $ 2,901,945 | $ 2,861,310 | $ 2,819,634 | $ 2,783,539 | $ 2,738,671 | 1 % | 6 % | |||||||
Total assets | d | $ 31,848,639 | $ 31,471,960 | $ 30,135,694 | $ 30,637,126 | $ 30,640,936 | 1 % | 4 % | |||||||
Less: Other intangible assets, net | 4,745 | 5,764 | 6,789 | 7,815 | 8,840 | (18) % | (46) % | ||||||||
Tangible assets | e | $ 31,843,894 | $ 31,466,196 | $ 30,128,905 | $ 30,629,311 | $ 30,632,096 | 1 % | 4 % | |||||||
Common shares outstanding at period end | f | 217,054 | 217,053 | 217,049 | 216,967 | 216,626 | — % | — % | |||||||
Total shareholders' equity to total assets ratio | a / d | 7.79 % | 7.68 % | 8.36 % | 8.51 % | 8.97 % | 0.11 | (1.18) | |||||||
Tangible common equity ratio | b / e | 7.77 % | 7.66 % | 8.34 % | 8.49 % | 8.95 % | 0.11 | (1.18) | |||||||
Tangible common equity ratio, ex AOCI | c / e | 9.11 % | 9.09 % | 9.36 % | 9.09 % | 8.94 % | 0.02 | 0.17 | |||||||
Book value per common share | a / f | $ 11.42 | $ 11.14 | $ 11.60 | $ 12.02 | $ 12.69 | 3 % | (10) % | |||||||
Tangible book value per common share | b / f | $ 11.40 | $ 11.11 | $ 11.57 | $ 11.98 | $ 12.65 | 3 % | (10) % | |||||||
Tangible book value per common share, ex AOCI | c / f | $ 13.37 | $ 13.18 | $ 12.99 | $ 12.83 | $ 12.64 | 1 % | 6 % | |||||||
nm = not meaningful | |||||||||||||||
Umpqua Holdings Corporation GAAP to Non-GAAP Reconciliation - Continued | |||||||||||||||
(Unaudited) | |||||||||||||||
Consolidated | Quarter Ended | % Change | |||||||||||||
(Dollars in thousands) | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Seq. Quarter | Year over Year | ||||||||
Non-Interest Income Adjustments | |||||||||||||||
Gain on sale of debt securities, net | $ — | $ — | $ — | $ 2 | $ 4 | nm | (100) % | ||||||||
Gain (loss) on equity securities, net | 284 | (2,647) | (2,075) | (2,661) | (466) | nm | nm | ||||||||
(Loss) gain on swap derivatives | (2,329) | 4,194 | 7,337 | 7,047 | (303) | (156) % | nm | ||||||||
Change in fair value of certain loans held for investment | 4,192 | (26,397) | (15,210) | (21,049) | (2,672) | nm | nm | ||||||||
Change in fair value of MSR due to valuation inputs or assumptions | (9,914) | 16,403 | 10,899 | 40,149 | 15,415 | (160) % | (164) % | ||||||||
MSR hedge loss | (348) | (14,128) | — | — | — | (98) % | nm | ||||||||
Total non-interest income adjustments | a | $ (8,115) | $ (22,575) | $ 951 | $ 23,488 | $ 11,978 | (64) % | (168) % | |||||||
Non-Interest Expense Adjustments | |||||||||||||||
Merger related expenses | $ 11,637 | $ 769 | $ 2,672 | $ 2,278 | $ 15,183 | nm | (23) % | ||||||||
Exit and disposal costs | 1,966 | 1,364 | 442 | 3,033 | 3,022 | 44 % | (35) % | ||||||||
Total non-interest expense adjustments | b | $ 13,603 | $ 2,133 | $ 3,114 | $ 5,311 | $ 18,205 | nm | (25) % | |||||||
Net interest income (1) | c | $ 305,762 | $ 287,933 | $ 248,522 | $ 229,117 | $ 233,754 | 6 % | 31 % | |||||||
Non-interest income (GAAP) | d | $ 34,879 | $ 29,445 | $ 55,235 | $ 79,969 | $ 82,738 | 18 % | (58) % | |||||||
Less: Non-interest income adjustments | a | 8,115 | 22,575 | (951) | (23,488) | (11,978) | (64) % | nm | |||||||
Operating non-interest income (non-GAAP) | e | $ 42,994 | $ 52,020 | $ 54,284 | $ 56,481 | $ 70,760 | (17) % | (39) % | |||||||
Revenue (GAAP) (1) | f=c+d | $ 340,641 | $ 317,378 | $ 303,757 | $ 309,086 | $ 316,492 | 7 % | 8 % | |||||||
Operating revenue (non-GAAP) (1) | g=c+e | $ 348,756 | $ 339,953 | $ 302,806 | $ 285,598 | $ 304,514 | 3 % | 15 % | |||||||
Non-interest expense (GAAP) | h | $ 194,982 | $ 177,964 | $ 179,574 | $ 182,430 | $ 199,711 | 10 % | (2) % | |||||||
Less: Non-interest expense adjustments | b | (13,603) | (2,133) | (3,114) | (5,311) | (18,205) | nm | (25) % | |||||||
Operating non-interest expense (non-GAAP) | i | $ 181,379 | $ 175,831 | $ 176,460 | $ 177,119 | $ 181,506 | 3 % | — % | |||||||
Net income (GAAP) | j | $ 82,964 | $ 84,040 | $ 78,591 | $ 91,157 | $ 88,354 | (1) % | (6) % | |||||||
Provision for income taxes | 29,464 | 27,473 | 26,548 | 30,341 | 28,788 | 7 % | 2 % | ||||||||
Income before provision for income taxes | 112,428 | 111,513 | 105,139 | 121,498 | 117,142 | 1 % | (4) % | ||||||||
Provision (recapture) for credit losses | 32,948 | 27,572 | 18,692 | 4,804 | (736) | 19 % | nm | ||||||||
Pre-provision net revenue (PPNR) (non-GAAP) | k | 145,376 | 139,085 | 123,831 | 126,302 | 116,406 | 5 % | 25 % | |||||||
Less: Non-interest income adjustments | a | 8,115 | 22,575 | (951) | (23,488) | (11,978) | (64) % | nm | |||||||
Add: Non-interest expense adjustments | b | 13,603 | 2,133 | 3,114 | 5,311 | 18,205 | nm | (25) % | |||||||
Operating PPNR (non-GAAP) | l | $ 167,094 | $ 163,793 | $ 125,994 | $ 108,125 | $ 122,633 | 2 % | 36 % | |||||||
Net income (GAAP) | j | $ 82,964 | $ 84,040 | $ 78,591 | $ 91,157 | $ 88,354 | (1) % | (6) % | |||||||
Less: Non-interest income adjustments | a | 8,115 | 22,575 | (951) | (23,488) | (11,978) | (64) % | nm | |||||||
Add: Non-interest expense adjustments | b | 13,603 | 2,133 | 3,114 | 5,311 | 18,205 | nm | (25) % | |||||||
Tax effect of adjustments | (5,459) | (6,116) | (480) | 4,576 | 1,190 | (11) % | nm | ||||||||
Operating net income (non-GAAP) | m | $ 99,223 | $ 102,632 | $ 80,274 | $ 77,556 | $ 95,771 | (3) % | 4 % | |||||||
nm = not meaningful | |||||||||||||||
(1) | Tax exempt interest has been adjusted to a taxable equivalent basis using a 21% tax rate. |
Umpqua Holdings Corporation GAAP to Non-GAAP Reconciliation - Continued | |||||||||||||||
(Unaudited) | |||||||||||||||
Consolidated | Quarter Ended | % Change | |||||||||||||
(Dollars in thousands, except per share | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Seq. Quarter | Year over Year | ||||||||
Average assets | n | $ 31,637,490 | $ 30,668,177 | $ 30,356,903 | $ 30,597,413 | $ 30,886,378 | 3 % | 2 % | |||||||
Less: Average goodwill and other intangible assets, net | 5,298 | 6,343 | 7,379 | 8,407 | 9,491 | (16) % | (44) % | ||||||||
Average tangible assets | o | $ 31,632,192 | $ 30,661,834 | $ 30,349,524 | $ 30,589,006 | $ 30,876,887 | 3 % | 2 % | |||||||
Average common shareholders' equity | p | $ 2,438,639 | $ 2,567,266 | $ 2,584,836 | $ 2,715,059 | $ 2,717,753 | (5) % | (10) % | |||||||
Less: Average goodwill and other intangible assets, net | 5,298 | 6,343 | 7,379 | 8,407 | 9,491 | (16) % | (44) % | ||||||||
Average tangible common equity | q | $ 2,433,341 | $ 2,560,923 | $ 2,577,457 | $ 2,706,652 | $ 2,708,262 | (5) % | (10) % | |||||||
Weighted average basic shares outstanding | r | 217,054 | 217,051 | 217,030 | 216,782 | 216,624 | — % | — % | |||||||
Weighted average diluted shares outstanding | s | 217,566 | 217,386 | 217,279 | 217,392 | 217,356 | — % | — % | |||||||
Select Per-Share & Performance Metrics | |||||||||||||||
Earnings-per-share - basic | j / r | $ 0.38 | $ 0.39 | $ 0.36 | $ 0.42 | $ 0.41 | (3) % | (7) % | |||||||
Earnings-per-share - diluted | j / s | $ 0.38 | $ 0.39 | $ 0.36 | $ 0.42 | $ 0.41 | (3) % | (7) % | |||||||
Efficiency ratio | h / f | 57.24 % | 56.07 % | 59.12 % | 59.02 % | 63.10 % | 1.17 | (5.86) | |||||||
PPNR return on average assets | k / n | 1.82 % | 1.80 % | 1.64 % | 1.67 % | 1.50 % | 0.02 | 0.32 | |||||||
Return on average assets | j / n | 1.04 % | 1.09 % | 1.04 % | 1.21 % | 1.13 % | (0.05) | (0.09) | |||||||
Return on average tangible assets | j / o | 1.04 % | 1.09 % | 1.04 % | 1.21 % | 1.14 % | (0.05) | (0.10) | |||||||
Return on average common equity | j / p | 13.50 % | 12.99 % | 12.20 % | 13.62 % | 12.90 % | 0.51 | 0.60 | |||||||
Return on average tangible common equity | j / q | 13.53 % | 13.02 % | 12.23 % | 13.66 % | 12.94 % | 0.51 | 0.59 | |||||||
Operating Per-Share & Performance Metrics | |||||||||||||||
Operating earnings-per-share - basic | m / r | $ 0.46 | $ 0.47 | $ 0.37 | $ 0.36 | $ 0.44 | (2) % | 5 % | |||||||
Operating earnings-per-share - diluted | m / s | $ 0.46 | $ 0.47 | $ 0.37 | $ 0.36 | $ 0.44 | (2) % | 5 % | |||||||
Operating efficiency ratio | i / g | 52.01 % | 51.72 % | 58.27 % | 62.02 % | 59.61 % | 0.29 | (7.60) | |||||||
Operating PPNR return on average assets | l / n | 2.10 % | 2.12 % | 1.66 % | 1.43 % | 1.58 % | (0.02) | 0.52 | |||||||
Operating return on average assets | m / n | 1.24 % | 1.33 % | 1.06 % | 1.03 % | 1.23 % | (0.09) | 0.01 | |||||||
Operating return on average tangible assets | m / o | 1.24 % | 1.33 % | 1.06 % | 1.03 % | 1.23 % | (0.09) | 0.01 | |||||||
Operating return on average common equity | m / p | 16.14 % | 15.86 % | 12.46 % | 11.58 % | 13.98 % | 0.28 | 2.16 | |||||||
Operating return on average tangible common equity | m / q | 16.18 % | 15.90 % | 12.49 % | 11.62 % | 14.03 % | 0.28 | 2.15 | |||||||
Umpqua Holdings Corporation GAAP to Non-GAAP Reconciliation - Continued | |||||||||||||||
(Unaudited) | |||||||||||||||
Core Banking | Quarter Ended | % Change | |||||||||||||
(Dollars in thousands) | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Seq. Quarter | Year over Year | ||||||||
Non-Interest Income Adjustments | |||||||||||||||
Gain on sale of debt securities, net | $ — | $ — | $ — | $ 2 | $ 4 | nm | (100) % | ||||||||
Gain (loss) on equity securities, net | 284 | (2,647) | (2,075) | (2,661) | (466) | nm | nm | ||||||||
(Loss) gain on swap derivatives | (2,329) | 4,194 | 7,337 | 7,047 | (303) | (156) % | nm | ||||||||
Change in fair value of certain loans held for investment | 4,192 | (26,397) | (15,210) | (21,049) | (2,672) | nm | nm | ||||||||
Total non-interest income adjustments | a | $ 2,147 | $ (24,850) | $ (9,948) | $ (16,661) | $ (3,437) | nm | nm | |||||||
Non-Interest Expense Adjustments | |||||||||||||||
Merger related expenses | $ 11,637 | $ 769 | $ 2,672 | $ 2,278 | $ 15,183 | nm | (23) % | ||||||||
Exit and disposal costs | 1,966 | 1,364 | 442 | 3,033 | 3,022 | 44 % | (35) % | ||||||||
Total non-interest expense adjustments | b | $ 13,603 | $ 2,133 | $ 3,114 | $ 5,311 | $ 18,205 | nm | (25) % | |||||||
Net interest income (1) | c | $ 305,313 | $ 286,861 | $ 247,361 | $ 227,441 | $ 231,625 | 6 % | 32 % | |||||||
Non-interest income (GAAP) | d | $ 36,509 | $ 11,919 | $ 24,513 | $ 18,989 | $ 39,375 | 206 % | (7) % | |||||||
Less: Non-interest income adjustments | a | (2,147) | 24,850 | 9,948 | 16,661 | 3,437 | (109) % | (162) % | |||||||
Operating non-interest income (non-GAAP) | e | $ 34,362 | $ 36,769 | $ 34,461 | $ 35,650 | $ 42,812 | (7) % | (20) % | |||||||
Revenue (GAAP) (1) | f=c+d | $ 341,822 | $ 298,780 | $ 271,874 | $ 246,430 | $ 271,000 | 14 % | 26 % | |||||||
Operating revenue (non-GAAP) (1) | g=c+e | $ 339,675 | $ 323,630 | $ 281,822 | $ 263,091 | $ 274,437 | 5 % | 24 % | |||||||
Non-interest expense (GAAP) (2) | h | $ 178,965 | $ 156,414 | $ 155,762 | $ 157,469 | $ 173,106 | 14 % | 3 % | |||||||
Less: Non-interest expense adjustments | b | (13,603) | (2,133) | (3,114) | (5,311) | (18,205) | nm | (25) % | |||||||
Operating non-interest expense (non-GAAP) | i | $ 165,362 | $ 154,281 | $ 152,648 | $ 152,158 | $ 154,901 | 7 % | 7 % | |||||||
Net income (GAAP) | j | $ 95,863 | $ 86,253 | $ 72,538 | $ 62,886 | $ 74,188 | 11 % | 29 % | |||||||
Provision for income taxes | 33,763 | 28,212 | 24,530 | 20,917 | 24,067 | 20 % | 40 % | ||||||||
Income before provision for income taxes | 129,626 | 114,465 | 97,068 | 83,803 | 98,255 | 13 % | 32 % | ||||||||
Provision (recapture) for credit losses | 32,948 | 27,572 | 18,692 | 4,804 | (736) | 19 % | nm | ||||||||
Pre-provision net revenue (PPNR) (non-GAAP) | k | 162,574 | 142,037 | 115,760 | 88,607 | 97,519 | 14 % | 67 % | |||||||
Less: Non-interest income adjustments | a | (2,147) | 24,850 | 9,948 | 16,661 | 3,437 | (109) % | (162) % | |||||||
Add: Non-interest expense adjustments | b | 13,603 | 2,133 | 3,114 | 5,311 | 18,205 | nm | (25) % | |||||||
Operating PPNR (non-GAAP) | l | $ 174,030 | $ 169,020 | $ 128,822 | $ 110,579 | $ 119,161 | 3 % | 46 % | |||||||
Net income (GAAP) | j | $ 95,863 | $ 86,253 | $ 72,538 | $ 62,886 | $ 74,188 | 11 % | 29 % | |||||||
Less: Non-interest income adjustments | a | (2,147) | 24,850 | 9,948 | 16,661 | 3,437 | (109) % | (162) % | |||||||
Add: Non-interest expense adjustments | b | 13,603 | 2,133 | 3,114 | 5,311 | 18,205 | nm | (25) % | |||||||
Tax effect of adjustments | (2,893) | (6,685) | (3,205) | (5,461) | (2,664) | (57) % | 9 % | ||||||||
Operating net income (non-GAAP) | m | $ 104,426 | $ 106,551 | $ 82,395 | $ 79,397 | $ 93,166 | (2) % | 12 % | |||||||
Efficiency ratio | h / f | 52.36 % | 52.35 % | 57.29 % | 63.90 % | 63.88 % | 0.01 | (11.52) | |||||||
Operating efficiency ratio | i / g | 48.68 % | 47.67 % | 54.16 % | 57.83 % | 56.44 % | 1.01 | (7.76) | |||||||
Core Banking net income / Consolidated net income | 115.55 % | 102.63 % | 92.30 % | 68.99 % | 83.97 % | 12.92 | 31.58 | ||||||||
Core Banking operating net income / Consolidated operating net income | 105.24 % | 103.82 % | 102.64 % | 102.37 % | 97.28 % | 1.42 | 7.96 | ||||||||
nm = not meaningful | |||||||||||||||
(1) | Tax exempt interest has been adjusted to a taxable equivalent basis using a 21% tax rate. |
(2) | Includes adjustments related to allocated expenses between the Core Banking and Mortgage Banking segments. |
Umpqua Holdings Corporation GAAP to Non-GAAP Reconciliation - Continued | |||||||||||||||
(Unaudited) | |||||||||||||||
Mortgage Banking | Quarter Ended | % Change | |||||||||||||
(Dollars in thousands) | Dec 31, 2022 | Sep 30, 2022 | Jun 30, 2022 | Mar 31, 2022 | Dec 31, 2021 | Seq. Quarter | Year over Year | ||||||||
Non-Interest Income Adjustments | |||||||||||||||
Change in fair value of MSR due to valuation inputs or assumptions | $ (9,914) | $ 16,403 | $ 10,899 | $ 40,149 | $ 15,415 | (160) % | (164) % | ||||||||
MSR hedge loss | (348) | (14,128) | — | — | — | (98) % | nm | ||||||||
Total non-interest income adjustments | a | $ (10,262) | $ 2,275 | $ 10,899 | $ 40,149 | $ 15,415 | nm | (167) % | |||||||
Total non-interest expense adjustments | b | $ — | $ — | $ — | $ — | $ — | nm | nm | |||||||
Net interest income | c | $ 449 | $ 1,072 | $ 1,161 | $ 1,676 | $ 2,129 | (58) % | (79) % | |||||||
Non-interest income (GAAP) | d | $ (1,630) | $ 17,526 | $ 30,722 | $ 60,980 | $ 43,363 | (109) % | (104) % | |||||||
Less: Non-interest income adjustments | a | 10,262 | (2,275) | (10,899) | (40,149) | (15,415) | nm | nm | |||||||
Operating non-interest income (non-GAAP) | e | $ 8,632 | $ 15,251 | $ 19,823 | $ 20,831 | $ 27,948 | (43) % | (69) % | |||||||
Revenue (GAAP) | f=c+d | $ (1,181) | $ 18,598 | $ 31,883 | $ 62,656 | $ 45,492 | (106) % | (103) % | |||||||
Operating revenue (non-GAAP) | g=c+e | $ 9,081 | $ 16,323 | $ 20,984 | $ 22,507 | $ 30,077 | (44) % | (70) % | |||||||
Non-interest expense (GAAP) (1) | h | $ 16,017 | $ 21,550 | $ 23,812 | $ 24,961 | $ 26,605 | (26) % | (40) % | |||||||
Less: Non-interest expense adjustments | b | — | — | — | — | — | nm | nm | |||||||
Operating non-interest expense (non-GAAP) | i | $ 16,017 | $ 21,550 | $ 23,812 | $ 24,961 | $ 26,605 | (26) % | (40) % | |||||||
Net income (GAAP) | j | $ (12,899) | $ (2,213) | $ 6,053 | $ 28,271 | $ 14,166 | 483 % | (191) % | |||||||
Provision for income taxes | (4,299) | (739) | 2,018 | 9,424 | 4,721 | 482 % | (191) % | ||||||||
Income before provision for income taxes | (17,198) | (2,952) | 8,071 | 37,695 | 18,887 | 483 % | (191) % | ||||||||
Provision for credit losses | — | — | — | — | — | nm | nm | ||||||||
Pre-provision net revenue (PPNR) (non-GAAP) | k | (17,198) | (2,952) | 8,071 | 37,695 | 18,887 | 483 % | (191) % | |||||||
Less: Non-interest income adjustments | a | 10,262 | (2,275) | (10,899) | (40,149) | (15,415) | nm | nm | |||||||
Add: Non-interest expense adjustments | b | — | — | — | — | — | nm | nm | |||||||
Operating PPNR (non-GAAP) | l | $ (6,936) | $ (5,227) | $ (2,828) | $ (2,454) | $ 3,472 | 33 % | (300) % | |||||||
Net income (GAAP) | j | $ (12,899) | $ (2,213) | $ 6,053 | $ 28,271 | $ 14,166 | 483 % | (191) % | |||||||
Less: Non-interest income adjustments | a | 10,262 | (2,275) | (10,899) | (40,149) | (15,415) | nm | nm | |||||||
Add: Non-interest expense adjustments | b | — | — | — | — | — | nm | nm | |||||||
Tax effect of adjustments | (2,566) | 569 | 2,725 | 10,037 | 3,854 | nm | (167) % | ||||||||
Operating net income (non-GAAP) | m | $ (5,203) | $ (3,919) | $ (2,121) | $ (1,841) | $ 2,605 | 33 % | (300) % | |||||||
Efficiency ratio | h / f | nm | 115.87 % | 74.69 % | 39.84 % | 58.48 % | nm | nm | |||||||
Operating efficiency ratio | i / g | 176.38 % | 132.02 % | 113.48 % | 110.90 % | 88.46 % | 34 % | 99 % | |||||||
Mortgage Banking net income / Consolidated net income | (15.55) % | (2.63) % | 7.70 % | 31.01 % | 16.03 % | (12.92) | (31.58) | ||||||||
Mortgage Banking operating net income / Consolidated operating net income | (5.24) % | (3.82) % | (2.64) % | (2.37) % | 2.72 % | (1.42) | (7.96) | ||||||||
nm = not meaningful | |||||||||||||||
(1) | Includes adjustments related to allocated expenses between the Core Banking and Mortgage Banking segments. |
Umpqua Holdings Corporation GAAP to Non-GAAP Reconciliation - Continued | |||||||
(Unaudited) | |||||||
Consolidated | Year to Date | % Change | |||||
(Dollars in thousands) | Dec 31, 2022 | Dec 31, 2021 | Year over Year | ||||
Non-Interest Income Adjustments | |||||||
Gain on sale of debt securities, net | $ 2 | $ 8 | (75) % | ||||
Loss on equity securities, net | (7,099) | (1,511) | 370 % | ||||
Gain on swap derivatives | 16,249 | 8,395 | 94 % | ||||
Change in fair value of certain loans held for investment | (58,464) | 3,032 | nm | ||||
Change in fair value of MSR due to valuation inputs or assumptions | 57,537 | 11,089 | 419 % | ||||
MSR hedge loss | (14,476) | — | nm | ||||
Total non-interest income adjustments | a | $ (6,251) | $ 21,013 | (130) % | |||
Non-Interest Expense Adjustments | |||||||
Merger related expenses | $ 17,356 | $ 15,183 | 14 % | ||||
Exit and disposal costs | 6,805 | 12,763 | (47) % | ||||
Total non-interest expense adjustments | b | $ 24,161 | $ 27,946 | (14) % | |||
Net interest income (1) | c | $ 1,071,334 | $ 921,158 | 16 % | |||
Non-interest income (GAAP) | d | $ 199,528 | $ 356,318 | (44) % | |||
Less: Non-interest income adjustments | a | 6,251 | (21,013) | nm | |||
Operating non-interest income (non-GAAP) | e | $ 205,779 | $ 335,305 | (39) % | |||
Revenue (GAAP) (1) | f=c+d | $ 1,270,862 | $ 1,277,476 | (1) % | |||
Operating revenue (non-GAAP) (1) | g=c+e | $ 1,277,113 | $ 1,256,463 | 2 % | |||
Non-interest expense (GAAP) | h | $ 734,950 | $ 760,456 | (3) % | |||
Less: Non-interest expense adjustments | b | (24,161) | (27,946) | (14) % | |||
Operating non-interest expense (non-GAAP) | i | $ 710,789 | $ 732,510 | (3) % | |||
Net income (GAAP) | j | $ 336,752 | $ 420,300 | (20) % | |||
Provision for income taxes | 113,826 | 137,860 | (17) % | ||||
Income before provision for income taxes | 450,578 | 558,160 | (19) % | ||||
Provision (recapture) for credit losses | 84,016 | (42,651) | nm | ||||
Pre-provision net revenue (PPNR) (non-GAAP) | k | 534,594 | 515,509 | 4 % | |||
Less: Non-interest income adjustments | a | 6,251 | (21,013) | nm | |||
Add: Non-interest expense adjustments | b | 24,161 | 27,946 | (14) % | |||
Operating PPNR (non-GAAP) | l | $ 565,006 | $ 522,442 | 8 % | |||
Net income (GAAP) | j | $ 336,752 | $ 420,300 | (20) % | |||
Less: Non-interest income adjustments | a | 6,251 | (21,013) | nm | |||
Add: Non-interest expense adjustments | b | 24,161 | 27,946 | (14) % | |||
Tax effect of adjustments | (7,479) | 1,014 | nm | ||||
Operating net income (non-GAAP) | m | $ 359,685 | $ 428,247 | (16) % | |||
nm = not meaningful | |||||||
Average assets | n | $ 30,817,396 | $ 30,267,372 | 2 % | |||
Less: Average goodwill and other intangible assets, net | $ 6,847 | $ 12,057 | (43) % | ||||
Average tangible assets | o | $ 30,810,549 | $ 30,255,315 | 2 % | |||
Average common shareholders' equity | p | $ 2,575,577 | $ 2,700,711 | (5) % | |||
Less: Average goodwill and other intangible assets, net | $ 6,847 | $ 12,057 | (43) % | ||||
Average tangible common equity | q | $ 2,568,730 | $ 2,688,654 | (4) % | |||
Weighted average basic shares outstanding | r | 216,980 | 219,032 | (1) % | |||
Weighted average diluted shares outstanding | s | 217,403 | 219,581 | (1) % | |||
Select Per-Share & Performance Metrics | |||||||
Earnings-per-share - basic | j / r | $ 1.55 | $ 1.92 | (19) % | |||
Earnings-per-share - diluted | j / s | $ 1.55 | $ 1.91 | (19) % | |||
Efficiency ratio | h / f | 57.83 % | 59.53 % | (1.70) | |||
PPNR return on average assets | k / n | 1.73 % | 1.70 % | 0.03 | |||
Return on average assets | j / n | 1.09 % | 1.39 % | (0.30) | |||
Return on average tangible assets | j / o | 1.09 % | 1.39 % | (0.30) | |||
Return on average common equity | j / p | 13.07 % | 15.56 % | (2.49) | |||
Return on average tangible common equity | j / q | 13.11 % | 15.63 % | (2.52) | |||
Operating Per-Share & Performance Metrics | |||||||
Operating earnings-per-share - basic | m / r | $ 1.66 | $ 1.96 | (15) % | |||
Operating earnings-per-share - diluted | m / s | $ 1.65 | $ 1.95 | (15) % | |||
Operating efficiency ratio | i / g | 55.66 % | 58.30 % | (2.64) | |||
Operating PPNR return on average assets | l / n | 1.83 % | 1.73 % | 0.10 | |||
Operating return on average assets | m / n | 1.17 % | 1.41 % | (0.24) | |||
Operating return on average tangible assets | m / o | 1.17 % | 1.42 % | (0.25) | |||
Operating return on average common equity | m / p | 13.97 % | 15.86 % | (1.89) | |||
Operating return on average tangible common equity | m / q | 14.00 % | 15.93 % | (1.93) | |||
(1) | Tax exempt interest has been adjusted to a taxable equivalent basis using a 21% tax rate. |
Umpqua Holdings Corporation GAAP to Non-GAAP Reconciliation - Continued | |||||||
(Unaudited) | |||||||
Core Banking | Year to Date | % Change | |||||
(Dollars in thousands) | Dec 31, 2022 | Dec 31, 2021 | Year over Year | ||||
Non-Interest Income Adjustments | |||||||
Gain on sale of debt securities, net | $ 2 | $ 8 | (75) % | ||||
Loss on equity securities, net | (7,099) | (1,511) | 370 % | ||||
Gain on swap derivatives | 16,249 | 8,395 | 94 % | ||||
Change in fair value of certain loans held for investment | (58,464) | 3,032 | nm | ||||
Total non-interest income adjustments | a | $ (49,312) | $ 9,924 | nm | |||
Non-Interest Expense Adjustments | |||||||
Merger related expenses | $ 17,356 | $ 15,183 | 14 % | ||||
Exit and disposal costs | 6,805 | 12,763 | (47) % | ||||
Total non-interest expense adjustments | b | $ 24,161 | $ 27,946 | (14) % | |||
Net interest income (1) | c | $ 1,066,976 | $ 909,598 | 17 % | |||
Non-interest income (GAAP) | d | $ 91,930 | $ 168,649 | (45) % | |||
Less: Non-interest income adjustments | a | 49,312 | (9,924) | nm | |||
Operating non-interest income (non-GAAP) | e | $ 141,242 | $ 158,725 | (11) % | |||
Revenue (GAAP) (1) | f=c+d | $ 1,158,906 | $ 1,078,247 | 7 % | |||
Operating revenue (non-GAAP) (1) | g=c+e | $ 1,208,218 | $ 1,068,323 | 13 % | |||
Non-interest expense (GAAP) (2) | h | $ 648,610 | $ 625,676 | 4 % | |||
Less: Non-interest expense adjustments | b | (24,161) | (27,946) | (14) % | |||
Operating non-interest expense (non-GAAP) | i | $ 624,449 | $ 597,730 | 4 % | |||
Net income (GAAP) | j | $ 317,540 | $ 371,963 | (15) % | |||
Provision for income taxes | 107,422 | 121,748 | (12) % | ||||
Income before provision for income taxes | 424,962 | 493,711 | (14) % | ||||
Provision (recapture) for credit losses | 84,016 | (42,651) | nm | ||||
Pre-provision net revenue (PPNR) (non-GAAP) | k | 508,978 | 451,060 | 13 % | |||
Less: Non-interest income adjustments | a | 49,312 | (9,924) | nm | |||
Add: Non-interest expense adjustments | b | 24,161 | 27,946 | (14) % | |||
Operating PPNR (non-GAAP) | l | $ 582,451 | $ 469,082 | 24 % | |||
Net income (GAAP) | j | $ 317,540 | $ 371,963 | (15) % | |||
Less: Non-interest income adjustments | a | 49,312 | (9,924) | nm | |||
Add: Non-interest expense adjustments | b | 24,161 | 27,946 | (14) % | |||
Tax effect of adjustments | (18,244) | (1,758) | nm | ||||
Operating net income (non-GAAP) | m | $ 372,769 | $ 388,227 | (4) % | |||
Efficiency ratio | h / f | 55.97 % | 58.03 % | (2.06) | |||
Operating efficiency ratio | i / g | 51.68 % | 55.95 % | (4.27) | |||
Core Banking net income / Consolidated net income | 94.29 % | 88.50 % | 5.79 | ||||
Core Banking operating net income / Consolidated operating net income | 103.64 % | 90.65 % | 12.99 | ||||
nm = not meaningful | |||||||
Umpqua Holdings Corporation GAAP to Non-GAAP Reconciliation - Continued | |||||||
(Unaudited) | |||||||
Mortgage Banking | Year to Date | % Change | |||||
(Dollars in thousands) | Dec 31, 2022 | Dec 31, 2021 | Year over Year | ||||
Non-Interest Income Adjustments | |||||||
Change in fair value of MSR due to valuation inputs or assumptions | $ 57,537 | $ 11,089 | 419 % | ||||
MSR hedge loss | (14,476) | — | nm | ||||
Total non-interest income adjustments | a | $ 43,061 | $ 11,089 | 288 % | |||
Total non-interest expense adjustments | b | $ — | $ — | nm | |||
Net interest income | c | $ 4,358 | $ 11,560 | (62) % | |||
Non-interest income (GAAP) | d | $ 107,598 | $ 187,669 | (43) % | |||
Less: Non-interest income adjustments | a | (43,061) | (11,089) | 288 % | |||
Operating non-interest income (non-GAAP) | e | $ 64,537 | $ 176,580 | (63) % | |||
Revenue (GAAP) | f=c+d | $ 111,956 | $ 199,229 | (44) % | |||
Operating revenue (non-GAAP) | g=c+e | $ 68,895 | $ 188,140 | (63) % | |||
Non-interest expense (GAAP) (1) | h | $ 86,340 | $ 134,780 | (36) % | |||
Less: Non-interest expense adjustments | b | — | — | nm | |||
Operating non-interest expense (non-GAAP) | i | $ 86,340 | $ 134,780 | (36) % | |||
Net income (GAAP) | j | $ 19,212 | $ 48,337 | (60) % | |||
Provision for income taxes | 6,404 | 16,112 | (60) % | ||||
Income before provision for income taxes | 25,616 | 64,449 | (60) % | ||||
Provision for credit losses | — | — | nm | ||||
Pre-provision net revenue (PPNR) (non-GAAP) | k | 25,616 | 64,449 | (60) % | |||
Less: Non-interest income adjustments | a | (43,061) | (11,089) | 288 % | |||
Add: Non-interest expense adjustments | b | — | — | nm | |||
Operating PPNR (non-GAAP) | l | $ (17,445) | $ 53,360 | (133) % | |||
Net income (GAAP) | j | $ 19,212 | $ 48,337 | (60) % | |||
Less: Non-interest income adjustments | a | (43,061) | (11,089) | 288 % | |||
Add: Non-interest expense adjustments | b | — | — | nm | |||
Tax effect of adjustments | 10,765 | 2,772 | 288 % | ||||
Operating net income (non-GAAP) | m | $ (13,084) | $ 40,020 | (133) % | |||
Efficiency ratio | h / f | 77.12 % | 67.65 % | 9.47 | |||
Operating efficiency ratio | i / g | 125.32 % | 71.64 % | 53.68 | |||
Mortgage Banking net income / Consolidated net income | 5.71 % | 11.50 % | (5.79) | ||||
Mortgage Banking operating net income / Consolidated operating net income | (3.64) % | 9.35 % | (12.99) | ||||
nm = not meaningful | |||||||
1 "Non-GAAP" financial measure. A reconciliation to the comparable GAAP measurement is provided on page 4
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SOURCE Umpqua Holdings Corporation
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