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M&T Bank Corporation Announces 2016 Fourth Quarter And Full-Year Results
PR Newswire
BUFFALO, N.Y.

BUFFALO, N.Y., Jan. 19, 2017 -- M&T Bank Corporation ("M&T")(NYSE: MTB) today reported its results of operations for 2016.

GAAP Results of Operations.  Diluted earnings per common share measured in accordance with generally accepted accounting principles ("GAAP") for the fourth quarter of 2016 were $1.98, up 20% from $1.65 in the year-earlier quarter.  GAAP-basis net income in the recent quarter aggregated $331 million, 22% higher than $271 million in the fourth quarter of 2015.  Diluted earnings per common share and GAAP-basis net income were $2.10 and $350 million, respectively, in the third quarter of 2016.  GAAP-basis net income for the final quarter of 2016 expressed as an annualized rate of return on average assets and average common shareholders' equity was 1.05% and 8.13%, respectively, compared with .93% and 7.22%, respectively, in the year-earlier quarter and 1.12% and 8.68%, respectively, in 2016's third quarter. 

In the fourth and third quarters of 2016, M&T sold its holdings of collateralized debt obligations in response to the provisions of the so-called "Volcker Rule" realizing pre-tax gains of $2 million and $28 million, respectively.  During the fourth quarter of 2016, M&T made a $30 million tax-deductible cash contribution to The M&T Charitable Foundation.  The after-tax impact of that contribution reduced the recent quarter's net income by $18 million, or $.12 of diluted earnings per common share.

Commenting on M&T's financial performance, Darren J. King, Executive Vice President and Chief Financial Officer, noted, "We are pleased with the recent quarter's results which were highlighted by an annualized 15% growth rate in M&T's commercial loan portfolios and a 3 basis point widening of the net interest margin as compared with the third quarter.  Expenses remained well-controlled in the quarter.   Consistent with recent performance, net charge-offs as a percentage of loans were below M&T's long-term average."

Earnings Highlights

 
                                         
                           

Change 4Q 2016 vs.

 

($ in millions, except per share data)

 

4Q16

   

4Q15

   

3Q16

   

4Q15

   

3Q16

 
                                         

Net income

 

$

331

   

$

271

   

$

350

     

22

%

   

-6

%

Net income available to common shareholders - diluted

 

$

308

   

$

248

   

$

327

     

24

%

   

-6

%

Diluted earnings per common share

 

$

1.98

   

$

1.65

   

$

2.10

     

20

%

   

-6

%

Annualized return on average assets

   

1.05

%

   

.93

%

   

1.12

%

               

Annualized return on average common equity

   

8.13

%

   

7.22

%

   

8.68

%

               

 

For the year ended December 31, 2016, diluted earnings per common share were $7.78, up 8% from $7.18 in 2015.  GAAP-basis net income for 2016 aggregated $1.32 billion, 22% higher than $1.08 billion in 2015.  Expressed as a rate of return on average assets, GAAP-basis net income was 1.06% in each of 2016 and 2015 while the rate of return on average common shareholders' equity was 8.16% in 2016 and 8.32% in 2015.

Supplemental Reporting of Non-GAAP Results of Operations.  M&T consistently provides supplemental reporting of its results on a "net operating" or "tangible" basis, from which M&T excludes the after-tax effect of amortization of core deposit and other intangible assets (and the related goodwill, core deposit intangible and other intangible asset balances, net of applicable deferred tax amounts) and expenses associated with merging acquired operations into M&T, since such items are considered by management to be "nonoperating" in nature.  The amounts of such "nonoperating" expenses are presented in the tables that accompany this release.  Although "net operating income" as defined by M&T is not a GAAP measure, M&T's management believes that this information helps investors understand the effect of acquisition activity in reported results.

Diluted net operating earnings per common share were $2.01 in the fourth quarter of 2016, compared with $2.09 in the year-earlier quarter and $2.13 in the third quarter of 2016.  Net operating income during the recent quarter was $336 million, compared with $338 million in the fourth quarter of 2015 and $356 million in 2016's third quarter.  The combined impact of the securities transactions and the charitable contribution noted earlier increased net operating income in the third quarter and decreased such income in the fourth quarter of 2016 by $17 million, or $.11 per diluted common share.  Expressed as an annualized rate of return on average tangible assets and average tangible common shareholders' equity, net operating income was 1.10% and 11.93%, respectively, in the recent quarter, compared with 1.21% and 13.26%, respectively, in the fourth quarter of 2015 and 1.18% and 12.77%, respectively, in the third quarter of 2016.

For the year ended December 31, 2016, diluted net operating earnings per common share were $8.08, up 4% from $7.74 in 2015.  Net operating income in 2016 rose 18% to $1.36 billion from $1.16 billion in 2015.  Expressed as a rate of return on average tangible assets and average tangible common shareholders' equity, net operating income was 1.14% and 12.25%, respectively, in 2016 and 1.18% and 13.00%, respectively, in 2015.

Taxable-equivalent Net Interest Income.  Net interest income expressed on a taxable-equivalent basis totaled $883 million in the fourth quarter of 2016, up 9% from $813 million in the year-earlier quarter.  Contributing to that improvement was a 10% increase in average earning assets, which grew to $114.3 billion in the recent quarter from $103.6 billion in the fourth quarter of 2015.  The growth in earning assets was predominantly the result of higher average loans, which rose to $90.0 billion in the recent quarter, up $8.9 billion, or 11%, from the fourth quarter of 2015.  Partially offsetting the favorable impact of the asset growth was a 4 basis point narrowing of the net interest margin to 3.08% in the recent quarter from 3.12% in the fourth quarter of 2015.  The narrowing reflects higher rates paid on interest-bearing time deposits associated with the acquisition of Hudson City Bancorp, Inc. ("Hudson City").  Taxable-equivalent net interest income in the recent quarter was 2% higher than $865 million in the third quarter of 2016.  The improvement resulted from a $1.4 billion increase in average earning assets, due to growth in average balances of investment securities and loans, and a 3 basis point widening of the net interest margin from 3.05% in the third quarter of 2016.  That widening reflects the impact of higher interest rates resulting from actions initiated in December by the Federal Reserve to increase its target federal funds rate.

                                         

Taxable-equivalent Net Interest Income

 
                                         
                           

Change 4Q 2016 vs.

 

($ in millions)

 

4Q16

   

4Q15

   

3Q16

   

4Q15

   

3Q16

 
                                         

Average earning assets

 

$

114,254

   

$

103,587

   

$

112,864

     

10

%

   

1

%

Net interest income - taxable equivalent

 

$

883

   

$

813

   

$

865

     

9

%

   

2

%

Net interest margin

   

3.08

%

   

3.12

%

   

3.05

%

               

Provision for Credit Losses/Asset Quality.  The provision for credit losses was $62 million in the recent quarter, $58 million in the fourth quarter of 2015 and $47 million in 2016's third quarter. Net charge-offs of loans were $49 million during the fourth quarter of 2016, compared with $36 million and $41 million in the fourth quarter of 2015 and third quarter of 2016, respectively.  Expressed as an annualized percentage of average loans outstanding, net charge-offs were .22% and .18% in the fourth quarters of 2016 and 2015, respectively, and .19% in the third quarter of 2016.  The provision for credit losses was $190 million for the year ended December 31, 2016, compared with $170 million in 2015.  Net loan charge-offs during 2016 and 2015 totaled $157 million and $134 million, respectively, or .18% and .19%, respectively, of average loans outstanding.

Loans classified as nonaccrual totaled $920 million, or 1.01% of total loans outstanding at December 31, 2016, compared with $799 million or .91% at December 31, 2015 and $837 million or .93% at September 30, 2016.  The higher level of nonaccrual loans at the recent quarter-end as compared with September 30, 2016 reflects higher commercial loans in this category and the normal migration of previously performing loans obtained in the acquisition of Hudson City that became past due over 90 days during the fourth quarter of 2016, and, as such, were not identifiable as purchased impaired as of the acquisition date. Nonaccrual Hudson City-related residential real estate loans aggregated $190 million and $149 million at December 31 and September 30, 2016, respectively.  Following the acquisition accounting provisions of GAAP, Hudson City-related loans classified as nonaccrual were insignificant at December 31, 2015. Assets taken in foreclosure of defaulted loans totaled $139 million at December 31, 2016, compared with $195 million a year earlier and $160 million at September 30, 2016.

Allowance for Credit Losses.  M&T regularly performs detailed analyses of individual borrowers and portfolios for purposes of assessing the adequacy of the allowance for credit losses.  As a result of those analyses, the allowance for credit losses totaled $989 million at December 31, 2016, compared with $956 million at December 31, 2015 and $976 million at September 30, 2016.  The allowance represented 1.09% of loans outstanding at each of those dates.

Asset Quality Metrics

 
                                         
                           

Change 4Q 2016 vs.

 

($ in millions)

 

4Q16

   

4Q15

   

3Q16

   

4Q15

   

3Q16

 
                                         

At end of quarter

                                       

Nonaccrual loans

 

$

920

   

$

799

   

$

837

     

15

%

   

10

%

Real estate and other foreclosed assets

 

$

139

   

$

195

   

$

160

     

-29

%

   

-13

%

Total nonperforming assets

 

$

1,059

   

$

994

   

$

997

     

7

%

   

6

%

Accruing loans past due 90 days or more (1)

 

$

301

   

$

317

   

$

317

     

-5

%

   

-5

%

Nonaccrual loans as % of loans outstanding

   

1.01

%

   

.91

%

   

.93

%

               
                                         

Allowance for credit losses

 

$

989

   

$

956

   

$

976

     

3

%

   

1

%

Allowance for credit losses as % of loans outstanding

   

1.09

%

   

1.09

%

   

1.09

%

               

For the period

                                       

Provision for credit losses

 

$

62

   

$

58

   

$

47

     

7

%

   

32

%

Net charge-offs

 

$

49

   

$

36

   

$

41

     

37

%

   

19

%

Net charge-offs as % of average loans (annualized)

   

.22

%

   

.18

%

   

.19

%

               

 

(1)

Excludes loans acquired at a discount.  Predominantly residential real estate loans.

 

Noninterest Income and Expense.  Noninterest income totaled $465 million in the recent quarter, compared with $448 million in the fourth quarter of 2015 and $491 million in the third quarter of 2016.  The recent quarter's improvement as compared with the final 2015 quarter resulted largely from higher mortgage banking revenues and trust income.  As compared with the third quarter of 2016, lower gains on investment securities and declines in residential mortgage banking revenues and trading account and foreign exchange gains were the predominant factors for the recent quarter's decline in noninterest income. 

Noninterest Income

 
                                         
                           

Change 4Q 2016 vs.

 

($ in millions)

 

4Q16

   

4Q15

   

3Q16

   

4Q15

   

3Q16

 
                                         

Mortgage banking revenues

 

$

98

   

$

88

   

$

104

     

13

%

   

-5

%

Service charges on deposit accounts

   

105

     

106

     

108

     

-1

%

   

-3

%

Trust income

   

122

     

114

     

119

     

6

%

   

3

%

Brokerage services income

   

15

     

15

     

16

     

-2

%

   

-4

%

Trading account and foreign exchange gains

   

7

     

10

     

12

     

-23

%

   

-40

%

Gain (loss) on bank investment securities

   

2

     

     

28

     

     

 

Other revenues from operations

   

116

     

115

     

104

     

1

%

   

11

%

Total other income

 

$

465

   

$

448

   

$

491

     

4

%

   

-5

%

 

Noninterest income totaled $1.83 billion in each of 2016 and 2015.  Higher gains on investment securities and trading account and foreign exchange activities in 2016 were offset by a $45 million gain in 2015 from the sale of M&T's trade processing business.

Noninterest expense totaled $769 million in the fourth quarter of 2016, $786 million in the fourth quarter of 2015 and $752 million in the third quarter of 2016.  Included in such amounts are expenses considered to be nonoperating in nature consisting of amortization of core deposit and other intangible assets and merger-related expenses.  Exclusive of those expenses, noninterest operating expenses were $760 million in the recent quarter, $701 million in the fourth quarter of 2015 and $743 million in the third quarter of 2016. Significant factors for the higher level of operating expenses in the recent quarter as compared with the final quarter of 2015 were the $30 million contribution to The M&T Charitable Foundation and higher FDIC assessments.  The increase in operating expense from the third quarter of 2016 also resulted from the recent quarter's charitable contribution that was partially offset by lower salaries and benefits and equipment and net occupancy costs.

Noninterest Expense

 
                                         
                           

Change 4Q 2016 vs.

 

($ in millions)

 

4Q16

   

4Q15

   

3Q16

   

4Q15

   

3Q16

 
                                         

Salaries and employee benefits

 

$

393

   

$

434

   

$

400

     

-9

%

   

-2

%

Equipment and net occupancy

   

70

     

71

     

75

     

-1

%

   

-7

%

Outside data processing and software

   

44

     

45

     

43

     

-3

%

   

3

%

FDIC assessments

   

29

     

20

     

28

     

48

%

   

2

%

Advertising and marketing

   

21

     

18

     

22

     

18

%

   

-4

%

Printing, postage and supplies

   

9

     

11

     

9

     

-20

%

   

-3

%

Amortization of core deposit and other intangible assets

   

9

     

9

     

10

     

-5

%

   

-7

%

Other costs of operations

   

194

     

178

     

165

     

9

%

   

17

%

Total other expense

 

$

769

   

$

786

   

$

752

     

-2

%

   

2

%

                                         

Memo: Merger-related expenses included in above

 

$

   

$

76

   

$

                 
                                         

 

For the year ended December 31, 2016, noninterest expense aggregated $3.05 billion, compared with $2.82 billion in 2015.  Noninterest operating expenses were $2.97 billion and $2.72 billion in 2016 and 2015, respectively.  Those increases reflect the full year impact of noninterest expenses associated with Hudson City that was acquired by M&T on November 1, 2015.

The efficiency ratio, or noninterest operating expenses divided by the sum of taxable-equivalent net interest income and noninterest income (exclusive of gains and losses from bank investment securities), measures the relationship of operating expenses to revenues.  M&T's efficiency ratio was 56.4% in the recent quarter, 55.5% in the year-earlier quarter and 55.9% in the third quarter of 2016.  The efficiency ratio for the full year 2016 was 56.1%, improved from 58.0% in 2015.

Balance Sheet.  M&T had total assets of $123.4 billion at December 31, 2016 , compared with $122.8 billion at December 31, 2015.  Investment securities totaled $16.3 billion at the end of 2016, up 4% from $15.7 billion at December 31, 2015.  Loans and leases, net of unearned discount, aggregated $90.9 billion at December 31, 2016, $3.4 billion or 4% above $87.5 billion a year earlier.  Total deposits also increased 4% to $95.5 billion at the recent year-end from $92.0 billion at December 31, 2015.

Total shareholders' equity rose 2% to $16.5 billion at December 31, 2016 from $16.2 billion a year earlier, representing 13.35% and 13.17%, respectively, of total assets.  Common shareholders' equity was $15.3 billion, or $97.64 per share, at December 31, 2016, compared with $14.9 billion, or $93.60 per share, at December 31, 2015.  Tangible equity per common share of $67.85 at December 31, 2016 was up 6% from $64.28 at December 31, 2015.  Common shareholders' equity per share and tangible equity per common share were $97.47 and $67.42, respectively, at September 30, 2016.  In the calculation of tangible equity per common share, common shareholders' equity is reduced by the carrying values of goodwill and core deposit and other intangible assets, net of applicable deferred tax balances.  M&T estimates that the ratio of Common Equity Tier 1 to risk-weighted assets under regulatory capital rules was approximately 10.96% at December 31, 2016.

In accordance with its 2016 capital plan, M&T repurchased 300,000 shares of its common stock during the recent quarter at an average cost per share of $124.45, for a total cost of $37 million.  During 2016, M&T repurchased a total of 5,607,595 shares of its common stock at an average cost per share of $114.37, for a total cost of $641 million.

Conference Call.  Investors will have an opportunity to listen to M&T's conference call to discuss fourth quarter and full-year financial results today at 11:00 a.m. Eastern Time.  Those wishing to participate in the call may dial (877)780-2276.  International participants, using any applicable international calling codes, may dial (973)582-2700.  Callers should reference M&T Bank Corporation or the conference ID #46296658.  The conference call will be webcast live through M&T's website at http://ir.mandtbank.com/events.cfm. A replay of the call will be available through Tuesday, January 24, 2017 by calling (800)585-8367, or (404)537-3406 for international participants, and by making reference to ID #46296658.  The event will also be archived and available by 7:00 p.m. today on M&T's website at http://ir.mandtbank.com/events.cfm.

M&T is a financial holding company headquartered in Buffalo, New York.  M&T's principal banking subsidiary, M&T Bank, operates banking offices in New York, Maryland, New Jersey, Pennsylvania, Delaware, Connecticut, Virginia, West Virginia and the District of Columbia.  Trust-related services are provided by M&T's Wilmington Trust-affiliated companies and by M&T Bank.

Forward-Looking Statements.  This news release contains forward-looking statements that are based on current expectations, estimates and projections about M&T's business, management's beliefs and assumptions made by management.  These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions ("Future Factors") which are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements. 

Future Factors include changes in interest rates, spreads on earning assets and interest-bearing liabilities, and interest rate sensitivity; prepayment speeds, loan originations, credit losses and market values on loans, collateral securing loans, and other assets; sources of liquidity; common shares outstanding; common stock price volatility; fair value of and number of stock-based compensation awards to be issued in future periods; the impact of changes in market values on trust-related revenues; legislation affecting the financial services industry as a whole, and M&T and its subsidiaries individually or collectively, including tax legislation; regulatory supervision and oversight, including monetary policy and capital requirements; changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board or regulatory agencies; increasing price and product/service competition by competitors, including new entrants; rapid technological developments and changes; the ability to continue to introduce competitive new products and services on a timely, cost-effective basis; the mix of products/services; containing costs and expenses; governmental and public policy changes; protection and validity of intellectual property rights; reliance on large customers; technological, implementation and cost/financial risks in large, multi-year contracts; the outcome of pending and future litigation and governmental proceedings, including tax-related examinations and other matters; continued availability of financing; financial resources in the amounts, at the times and on the terms required to support M&T and its subsidiaries' future businesses; and material differences in the actual financial results of merger, acquisition and investment activities compared with M&T's initial expectations, including the full realization of anticipated cost savings and revenue enhancements.

These are representative of the Future Factors that could affect the outcome of the forward-looking statements.  In addition, such statements could be affected by general industry and market conditions and growth rates, general economic and political conditions, either nationally or in the states in which M&T and its subsidiaries do business, including interest rate and currency exchange rate fluctuations, changes and trends in the securities markets, and other Future Factors.

 

 

Financial Highlights

       
   

Three months ended

           

Year ended

         
   

December 31

           

December 31

         

Amounts in thousands, except per share

 

2016

   

2015

   

Change

   

2016

   

2015

   

Change

 

Performance

                                               

Net income

 

$

330,571

     

270,965

     

22

%

 

$

1,315,114

     

1,079,667

     

22

%

Net income available to common shareholders

   

307,797

     

248,059

     

24

%

   

1,223,481

     

987,724

     

24

%

                                                 

Per common share:

                                               

Basic earnings

 

$

1.98

     

1.65

     

20

%

 

$

7.80

     

7.22

     

8

%

Diluted earnings

   

1.98

     

1.65

     

20

%

   

7.78

     

7.18

     

8

%

Cash dividends

 

$

.70

     

.70

     

   

$

2.80

     

2.80

     

 
                                                 

Common shares outstanding:

                                               

Average - diluted (1)

   

155,700

     

150,718

     

3

%

   

157,304

     

137,533

     

14

%

Period end (2)

   

156,213

     

159,600

     

-2

%

   

156,213

     

159,600

     

-2

%

                                                 

Return on (annualized):

                                               

Average total assets

   

1.05

%

   

.93

%

           

1.06

%

   

1.06

%

       

Average common shareholders' equity

   

8.13

%

   

7.22

%

           

8.16

%

   

8.32

%

       

Taxable-equivalent net interest income

 

$

883,147

     

813,401

     

9

%

 

$

3,496,849

     

2,867,050

     

22

%

                                                 

Yield on average earning assets

   

3.45

%

   

3.48

%

           

3.49

%

   

3.50

%

       

Cost of interest-bearing liabilities

   

.57

%

   

.54

%

           

.56

%

   

.55

%

       

Net interest spread

   

2.88

%

   

2.94

%

           

2.93

%

   

2.95

%

       

Contribution of interest-free funds

   

.20

%

   

.18

%

           

.18

%

   

.19

%

       

Net interest margin

   

3.08

%

   

3.12

%

           

3.11

%

   

3.14

%

       

Net charge-offs to average total net loans (annualized)

   

.22

%

   

.18

%

           

.18

%

   

.19

%

       
                                                 

Net operating results (3)

                                               

Net operating income

 

$

336,095

     

337,613

     

   

$

1,362,692

     

1,156,637

     

18

%

Diluted net operating earnings per common share

   

2.01

     

2.09

     

-4

%

   

8.08

     

7.74

     

4

%

Return on (annualized):

                                               

Average tangible assets

   

1.10

%

   

1.21

%

           

1.14

%

   

1.18

%

       

Average tangible common equity

   

11.93

%

   

13.26

%

           

12.25

%

   

13.00

%

       

Efficiency ratio

   

56.42

%

   

55.53

%

           

56.10

%

   

57.98

%

       
                                                 
   

At December 31

                                 

Loan quality

 

2016

   

2015

   

Change

                         

Nonaccrual loans

 

$

920,015

     

799,409

     

15

%

                       

Real estate and other foreclosed assets

   

139,206

     

195,085

     

-29

%

                       

Total nonperforming assets

 

$

1,059,221

     

994,494

     

7

%

                       
                                                 

Accruing loans past due 90 days or more (4)

 

$

300,659

     

317,441

     

-5

%

                       
                                                 

Government guaranteed loans included in totals above:

                                               

Nonaccrual loans

 

$

40,610

     

47,052

     

-14

%

                       

Accruing loans past due 90 days or more

   

282,659

     

276,285

     

2

%

                       
                                                 

Renegotiated loans

 

$

190,374

     

182,865

     

4

%

                       
                                                 

Accruing loans acquired at a discount past due 90 days or more (5)

 

$

61,144

     

68,473

     

-11

%

                       
                                                 

Purchased impaired loans (6):

                                               

Outstanding customer balance

 

$

927,446

     

1,204,004

     

-23

%

                       

Carrying amount

   

578,032

     

768,329

     

-25

%

                       
                                                 

Nonaccrual loans to total net loans

   

1.01

%

   

.91

%

                               
                                                 

Allowance for credit losses to total loans

   

1.09

%

   

1.09

%

                               

 

(1)

Includes common stock equivalents.

(2)

Includes common stock issuable under deferred compensation plans.

(3)

Excludes amortization and balances related to goodwill and core deposit and other intangible assets and merger-related expenses which, except in the calculation of the efficiency ratio, are net of applicable income tax effects. Reconciliations of net income with net operating income appear herein.

(4)

Excludes loans acquired at a discount.  Predominantly residential real estate loans.

(5)

Loans acquired at a discount that were recorded at fair value at acquisition date. This category does not include purchased impaired loans that are presented separately.

(6)

Accruing loans acquired at a discount that were impaired at acquisition date and recorded at fair value.

 

 

Financial Highlights, Five Quarter Trend

 
   

Three months ended

 
   

December 31,

   

September 30,

   

June 30,

   

March 31,

   

December 31,

 

Amounts in thousands, except per share

 

2016

   

2016

   

2016

   

2016

   

2015

 

Performance

                                       

Net income

 

$

330,571

     

349,984

     

336,031

     

298,528

     

270,965

 

Net income available to common shareholders

   

307,797

     

326,998

     

312,974

     

275,748

     

248,059

 

Per common share:

                                       

Basic earnings

 

$

1.98

     

2.10

     

1.98

     

1.74

     

1.65

 

Diluted earnings

   

1.98

     

2.10

     

1.98

     

1.73

     

1.65

 

Cash dividends

 

$

.70

     

.70

     

.70

     

.70

     

.70

 

Common shares outstanding:

                                       

Average - diluted (1)

   

155,700

     

156,026

     

158,341

     

159,181

     

150,718

 

Period end (2)

   

156,213

     

154,987

     

157,917

     

159,156

     

159,600

 

Return on (annualized):

                                       

Average total assets

   

1.05

%

   

1.12

%

   

1.09

%

   

.97

%

   

.93

%

Average common shareholders' equity

   

8.13

%

   

8.68

%

   

8.38

%

   

7.44

%

   

7.22

%

Taxable-equivalent net interest income

 

$

883,147

     

865,065

     

870,341

     

878,296

     

813,401

 

Yield on average earning assets

   

3.45

%

   

3.44

%

   

3.51

%

   

3.54

%

   

3.48

%

Cost of interest-bearing liabilities

   

.57

%

   

.59

%

   

.56

%

   

.53

%

   

.54

%

Net interest spread

   

2.88

%

   

2.85

%

   

2.95

%

   

3.01

%

   

2.94

%

Contribution of interest-free funds

   

.20

%

   

.20

%

   

.18

%

   

.17

%

   

.18

%

Net interest margin

   

3.08

%

   

3.05

%

   

3.13

%

   

3.18

%

   

3.12

%

Net charge-offs to average total net loans (annualized)

   

.22

%

   

.19

%

   

.11

%

   

.19

%

   

.18

%

Net operating results (3)

                                       

Net operating income

 

$

336,095

     

355,929

     

350,604

     

320,064

     

337,613

 

Diluted net operating earnings per common share

   

2.01

     

2.13

     

2.07

     

1.87

     

2.09

 

Return on (annualized):

                                       

Average tangible assets

   

1.10

%

   

1.18

%

   

1.18

%

   

1.09

%

   

1.21

%

Average tangible common equity

   

11.93

%

   

12.77

%

   

12.68

%

   

11.62

%

   

13.26

%

Efficiency ratio

   

56.42

%

   

55.92

%

   

55.06

%

   

57.00

%

   

55.53

%

                                         
   

December 31,

   

September 30,

   

June 30,

   

March 31,

   

December 31,

 

Loan quality

 

2016

   

2016

   

2016

   

2016

   

2015

 

Nonaccrual loans

 

$

920,015

     

837,362

     

848,855

     

876,691

     

799,409

 

Real estate and other foreclosed assets

   

139,206

     

159,881

     

172,473

     

188,004

     

195,085

 

Total nonperforming assets

 

$

1,059,221

     

997,243

     

1,021,328

     

1,064,695

     

994,494

 

Accruing loans past due 90 days or more (4)

 

$

300,659

     

317,282

     

298,449

     

336,170

     

317,441

 

Government guaranteed loans included in totals above:

                                       

Nonaccrual loans

 

$

40,610

     

47,130

     

52,486

     

49,688

     

47,052

 

Accruing loans past due 90 days or more

   

282,659

     

282,077

     

269,962

     

279,340

     

276,285

 

Renegotiated loans

 

$

190,374

     

217,559

     

211,159

     

200,771

     

182,865

 

Accruing loans acquired at a discount past due 90 days or more (5)

 

$

61,144

     

65,182

     

68,591

     

61,767

     

68,473

 

Purchased impaired loans (6):

                                       

Outstanding customer balance

 

$

927,446

     

981,105

     

1,040,678

     

1,124,776

     

1,204,004

 

Carrying amount

   

578,032

     

616,991

     

662,059

     

715,874

     

768,329

 

Nonaccrual loans to total net loans

   

1.01

%

   

.93

%

   

.96

%

   

1.00

%

   

.91

%

Allowance for credit losses to total loans

   

1.09

%

   

1.09

%

   

1.10

%

   

1.10

%

   

1.09

%

 

(1)

Includes common stock equivalents.

(2)

Includes common stock issuable under deferred compensation plans.

(3)

Excludes amortization and balances related to goodwill and core deposit and other intangible assets and merger-related expenses which, except in the calculation of the efficiency ratio, are net of applicable income tax effects. Reconciliations of net income with net operating income appear herein.

(4)

Excludes loans acquired at a discount.  Predominantly residential real estate loans.

(5)

Loans acquired at a discount that were recorded at fair value at acquisition date. This category does not include purchased impaired loans that are presented separately.

(6)

Accruing loans acquired at a discount that were impaired at acquisition date and recorded at fair value. 

 

 

Condensed Consolidated Statement of Income

                     
   

Three months ended

           

Year ended

         
   

December 31

           

December 31

         

Dollars in thousands

 

2016

   

2015

   

Change

   

2016

   

2015

   

Change

 

Interest income

 

$

982,901

     

902,377

     

9

%

 

$

3,895,871

     

3,170,844

     

23

%

Interest expense

   

107,137

     

95,333

     

12

     

425,984

     

328,257

     

30

 

Net interest income

   

875,764

     

807,044

     

9

     

3,469,887

     

2,842,587

     

22

 

Provision for credit losses

   

62,000

     

58,000

     

7

     

190,000

     

170,000

     

12

 

Net interest income after provision for credit losses

   

813,764

     

749,044

     

9

     

3,279,887

     

2,672,587

     

23

 

Other income

                                               

Mortgage banking revenues

   

98,504

     

87,500

     

13

     

373,697

     

375,738

     

-1

 

Service charges on deposit accounts

   

104,890

     

105,748

     

-1

     

419,102

     

420,608

     

 

Trust income

   

122,003

     

114,564

     

6

     

472,184

     

470,640

     

 

Brokerage services income

   

15,233

     

15,546

     

-2

     

63,423

     

64,770

     

-2

 

Trading account and foreign exchange gains

   

7,692

     

9,938

     

-23

     

41,126

     

30,577

     

34

 

Gain (loss) on bank investment securities

   

1,566

     

(22)

     

     

30,314

     

(130)

     

 

Other revenues from operations

   

115,571

     

114,834

     

1

     

426,150

     

462,834

     

-8

 

Total other income

   

465,459

     

448,108

     

4

     

1,825,996

     

1,825,037

     

 

Other expense

                                               

Salaries and employee benefits

   

393,354

     

434,413

     

-9

     

1,623,600

     

1,549,530

     

5

 

Equipment and net occupancy

   

69,976

     

70,747

     

-1

     

295,141

     

272,539

     

8

 

Outside data processing and software

   

43,987

     

45,251

     

-3

     

172,389

     

164,133

     

5

 

FDIC assessments

   

28,991

     

19,562

     

48

     

105,045

     

52,113

     

102

 

Advertising and marketing

   

21,074

     

17,892

     

18

     

87,137

     

59,227

     

47

 

Printing, postage and supplies

   

8,681

     

10,905

     

-20

     

39,546

     

38,491

     

3

 

Amortization of core deposit and other intangible assets

   

9,089

     

9,576

     

-5

     

42,613

     

26,424

     

61

 

Other costs of operations

   

193,951

     

177,767

     

9

     

682,014

     

660,475

     

3

 

Total other expense

   

769,103

     

786,113

     

-2

     

3,047,485

     

2,822,932

     

8

 

Income before income taxes

   

510,120

     

411,039

     

24

     

2,058,398

     

1,674,692

     

23

 

Applicable income taxes

   

179,549

     

140,074

     

28

     

743,284

     

595,025

     

25

 

Net income

 

$

330,571

     

270,965

     

22

%

 

$

1,315,114

     

1,079,667

     

22

%

 

 

Condensed Consolidated Statement of Income, Five Quarter Trend

 
   

Three months ended

 
   

December 31,

   

September 30,

   

June 30,

   

March 31,

   

December 31,

 

Dollars in thousands

 

2016

   

2016

   

2016

   

2016

   

2015

 

Interest income

 

$

982,901

     

969,515

     

970,621

     

972,834

     

902,377

 

Interest expense

   

107,137

     

111,175

     

106,802

     

100,870

     

95,333

 

Net interest income

   

875,764

     

858,340

     

863,819

     

871,964

     

807,044

 

Provision for credit losses

   

62,000

     

47,000

     

32,000

     

49,000

     

58,000

 

Net interest income after provision for credit losses

   

813,764

     

811,340

     

831,819

     

822,964

     

749,044

 

Other income

                                       

Mortgage banking revenues

   

98,504

     

103,747

     

89,383

     

82,063

     

87,500

 

Service charges on deposit accounts

   

104,890

     

107,935

     

103,872

     

102,405

     

105,748

 

Trust income

   

122,003

     

118,654

     

120,450

     

111,077

     

114,564

 

Brokerage services income

   

15,233

     

15,914

     

16,272

     

16,004

     

15,546

 

Trading account and foreign exchange gains

   

7,692

     

12,754

     

13,222

     

7,458

     

9,938

 

Gain (loss) on bank investment securities

   

1,566

     

28,480

     

264

     

4

     

(22)

 

Other revenues from operations

   

115,571

     

103,866

     

104,791

     

101,922

     

114,834

 

Total other income

   

465,459

     

491,350

     

448,254

     

420,933

     

448,108

 

Other expense

                                       

Salaries and employee benefits

   

393,354

     

399,786

     

398,675

     

431,785

     

434,413

 

Equipment and net occupancy

   

69,976

     

75,263

     

75,724

     

74,178

     

70,747

 

Outside data processing and software

   

43,987

     

42,878

     

42,509

     

43,015

     

45,251

 

FDIC assessments

   

28,991

     

28,459

     

22,370

     

25,225

     

19,562

 

Advertising and marketing

   

21,074

     

21,996

     

22,613

     

21,454

     

17,892

 

Printing, postage and supplies

   

8,681

     

8,972

     

9,907

     

11,986

     

10,905

 

Amortization of core deposit and other intangible assets

   

9,089

     

9,787

     

11,418

     

12,319

     

9,576

 

Other costs of operations

   

193,951

     

165,251

     

166,679

     

156,133

     

177,767

 

Total other expense

   

769,103

     

752,392

     

749,895

     

776,095

     

786,113

 

Income before income taxes

   

510,120

     

550,298

     

530,178

     

467,802

     

411,039

 

Applicable income taxes

   

179,549

     

200,314

     

194,147

     

169,274

     

140,074

 

Net income

 

$

330,571

     

349,984

     

336,031

     

298,528

     

270,965

 

 

 

Condensed Consolidated Balance Sheet

           
   

December 31

           

Dollars in thousands

 

2016

   

2015

   

Change

   

ASSETS

                         

Cash and due from banks

 

$

1,320,549

     

1,368,040

     

-3

 

%

Interest-bearing deposits at banks

   

5,000,638

     

7,594,350

     

-34

   

Trading account assets

   

323,867

     

273,783

     

18

   

Investment securities

   

16,250,468

     

15,656,439

     

4

   

Loans and leases:

                         

Commercial, financial, etc.

   

22,610,047

     

20,422,338

     

11

   

Real estate - commercial

   

33,506,394

     

29,197,311

     

15

   

Real estate - consumer

   

22,590,912

     

26,270,103

     

-14

   

Consumer

   

12,146,063

     

11,599,747

     

5

   

Total loans and leases, net of unearned discount

   

90,853,416

     

87,489,499

     

4

   

Less: allowance for credit losses

   

988,997

     

955,992

     

3

   

Net loans and leases

   

89,864,419

     

86,533,507

     

4

   

Goodwill

   

4,593,112

     

4,593,112

     

   

Core deposit and other intangible assets

   

97,655

     

140,268

     

-30

   

Other assets

   

5,998,498

     

6,628,385

     

-10

   

Total assets

 

$

123,449,206

     

122,787,884

     

1

 

%

LIABILITIES AND SHAREHOLDERS' EQUITY

                         

Noninterest-bearing deposits

 

$

32,456,102

     

29,110,635

     

11

 

%

Interest-bearing deposits

   

62,835,847

     

62,677,036

     

   

Deposits at Cayman Islands office

   

201,927

     

170,170

     

19

   

Total deposits

   

95,493,876

     

91,957,841

     

4

   

Short-term borrowings

   

163,442

     

2,132,182

     

-92

   

Accrued interest and other liabilities

   

1,811,431

     

1,870,714

     

-3

   

Long-term borrowings

   

9,493,835

     

10,653,858

     

-11

   

Total liabilities

   

106,962,584

     

106,614,595

     

   

Shareholders' equity:

                         

Preferred

   

1,231,500

     

1,231,500

     

   

Common (1)

   

15,255,122

     

14,941,789

     

2

   

Total shareholders' equity

   

16,486,622

     

16,173,289

     

2

   

Total liabilities and shareholders' equity

 

$

123,449,206

     

122,787,884

     

1

 

%

 

(1)

Reflects accumulated other comprehensive loss, net of applicable income tax effect, of $294.6 million at December 31, 2016 and $251.6 million at December 31, 2015.

 

 

Condensed Consolidated Balance Sheet, Five Quarter Trend

                   
   

December 31,

   

September 30,

   

June 30,

   

March 31,

   

December 31,

 

Dollars in thousands

 

2016

   

2016

   

2016

   

2016

   

2015

 

ASSETS

                                       

Cash and due from banks

 

$

1,320,549

     

1,332,202

     

1,284,442

     

1,178,175

     

1,368,040

 

Interest-bearing deposits at banks

   

5,000,638

     

10,777,636

     

8,474,839

     

9,545,181

     

7,594,350

 

Trading account assets

   

323,867

     

488,588

     

506,131

     

467,987

     

273,783

 

Investment securities

   

16,250,468

     

14,733,574

     

14,963,084

     

15,467,320

     

15,656,439

 

Loans and leases:

                                       

Commercial, financial, etc.

   

22,610,047

     

21,917,163

     

21,469,242

     

21,226,577

     

20,422,338

 

Real estate - commercial

   

33,506,394

     

32,078,762

     

30,711,230

     

29,713,293

     

29,197,311

 

Real estate - consumer

   

22,590,912

     

23,584,420

     

24,530,249

     

25,299,638

     

26,270,103

 

Consumer

   

12,146,063

     

12,066,147

     

11,811,277

     

11,632,958

     

11,599,747

 

Total loans and leases, net of unearned discount

   

90,853,416

     

89,646,492

     

88,521,998

     

87,872,466

     

87,489,499

 

Less: allowance for credit losses

   

988,997

     

976,121

     

970,496

     

962,752

     

955,992

 

Net loans and leases

   

89,864,419

     

88,670,371

     

87,551,502

     

86,909,714

     

86,533,507

 

Goodwill

   

4,593,112

     

4,593,112

     

4,593,112

     

4,593,112

     

4,593,112

 

Core deposit and other intangible assets

   

97,655

     

106,744

     

116,531

     

127,949

     

140,268

 

Other assets

   

5,998,498

     

6,138,801

     

6,330,943

     

6,336,194

     

6,628,385

 

Total assets

 

$

123,449,206

     

126,841,028

     

123,820,584

     

124,625,632

     

122,787,884

 

LIABILITIES AND SHAREHOLDERS' EQUITY

                                       

Noninterest-bearing deposits

 

$

32,456,102

     

33,127,627

     

30,700,066

     

29,709,218

     

29,110,635

 

Interest-bearing deposits

   

62,835,847

     

64,786,035

     

63,756,514

     

64,338,571

     

62,677,036

 

Deposits at Cayman Islands office

   

201,927

     

223,183

     

193,523

     

166,787

     

170,170

 

Total deposits

   

95,493,876

     

98,136,845

     

94,650,103

     

94,214,576

     

91,957,841

 

Short-term borrowings

   

163,442

     

213,846

     

407,123

     

1,766,826

     

2,132,182

 

Accrued interest and other liabilities

   

1,811,431

     

1,938,201

     

1,963,093

     

1,948,142

     

1,870,714

 

Long-term borrowings

   

9,493,835

     

10,211,160

     

10,328,751

     

10,341,035

     

10,653,858

 

Total liabilities

   

106,962,584

     

110,500,052

     

107,349,070

     

108,270,579

     

106,614,595

 

Shareholders' equity:

                                       

Preferred

   

1,231,500

     

1,231,500

     

1,231,500

     

1,231,500

     

1,231,500

 

Common (1)

   

15,255,122

     

15,109,476

     

15,240,014

     

15,123,553

     

14,941,789

 

Total shareholders' equity

   

16,486,622

     

16,340,976

     

16,471,514

     

16,355,053

     

16,173,289

 

Total liabilities and shareholders' equity

 

$

123,449,206

     

126,841,028

     

123,820,584

     

124,625,632

     

122,787,884

 

 

(1)

Reflects accumulated other comprehensive loss, net of applicable income tax effect, of $294.6 million at December 31, 2016, $114.6 million at September 30, 2016, $101.0 million at June 30, 2016, $150.2 million at March 31, 2016 and $251.6 million at December 31, 2015.

 

 

Condensed Consolidated Average Balance Sheet and Annualized Taxable-equivalent Rates

                       
   

Three months ended

   

Change in balance

   

Year ended

           
   

December 31,

   

December 31,

   

September 30,

   

December 31, 2016 from

   

December 31

   

Change

   

Dollars in millions

 

2016

   

2015

   

2016

   

December 31,

   

September 30,

   

2016

   

2015

   

in

   
   

Balance

   

Rate

   

Balance

   

Rate

   

Balance

   

Rate

   

2015

   

2016

   

Balance

   

Rate

   

Balance

   

Rate

   

balance

   
                                                                                   

ASSETS

                                                                                                         

Interest-bearing deposits at banks

 

$

8,790

     

.54

 

%

 

6,622

     

.30

 

%

 

9,681

     

.51

 

%

 

33

 

%

 

-9

 

%

$

8,846

     

.51

 

%

 

5,775

     

.26

 

%

 

53

 

%

Federal funds sold

   

     

     

1

     

.54

     

     

     

-100

     

     

     

     

34

     

.10

     

-100

   

Trading account assets

   

70

     

2.05

     

68

     

1.88

     

90

     

1.52

     

3

     

-22

     

85

     

1.71

     

86

     

1.44

     

-2

   

Investment securities

   

15,417

     

2.28

     

15,786

     

2.55

     

14,361

     

2.38

     

-2

     

7

     

15,009

     

2.44

     

14,456

     

2.62

     

4

   

Loans and leases, net of unearned discount

                                                                                                         

Commercial, financial, etc.

   

21,936

     

3.47

     

20,221

     

3.23

     

21,480

     

3.44

     

8

     

2

     

21,397

     

3.44

     

19,899

     

3.21

     

8

   

Real estate - commercial

   

32,822

     

4.01

     

28,973

     

4.11

     

31,252

     

4.00

     

13

     

5

     

30,915

     

4.06

     

28,276

     

4.16

     

9

   

Real estate - consumer

   

23,096

     

3.88

     

20,369

     

4.01

     

24,058

     

3.92

     

13

     

-4

     

24,463

     

3.92

     

11,458

     

4.09

     

114

   

Consumer

   

12,123

     

4.53

     

11,547

     

4.44

     

11,942

     

4.55

     

5

     

2

     

11,841

     

4.54

     

11,203

     

4.46

     

6

   

Total loans and leases, net

   

89,977

     

3.93

     

81,110

     

3.92

     

88,732

     

3.93

     

11

     

1

     

88,616

     

3.96

     

70,836

     

3.95

     

25

   

Total earning assets

   

114,254

     

3.45

     

103,587

     

3.48

     

112,864

     

3.44

     

10

     

1

     

112,556

     

3.49

     

91,187

     

3.50

     

23

   

Goodwill

   

4,593

             

4,218

             

4,593

             

9

     

     

4,593

             

3,694

             

24

   

Core deposit and other intangible assets

   

102

             

101

             

112

             

     

-9

     

117

             

45

             

163

   

Other assets

   

6,785

             

7,146

             

7,156

             

-5

     

-5

     

7,074

             

6,854

             

3

   

Total assets

 

$

125,734

             

115,052

             

124,725

             

9

 

%

 

1

 

%

$

124,340

             

101,780

             

22

 

%

                                                                                                           

LIABILITIES AND SHAREHOLDERS' EQUITY

                                                                                                         

Interest-bearing deposits

                                                                                                         

Savings and interest-checking deposits

 

$

54,055

     

.20

     

47,305

     

.11

     

52,516

     

.18

     

14

 

%

 

3

 

%

$

52,194

     

.17

     

43,885

     

.11

     

19

 

%

Time deposits

   

10,936

     

.86

     

9,686

     

.65

     

12,334

     

.90

     

13

     

-11

     

12,253

     

.84

     

4,641

     

.58

     

164

   

Deposits at Cayman Islands office

   

206

     

.42

     

224

     

.30

     

220

     

.37

     

-8

     

-6

     

199

     

.40

     

216

     

.28

     

-8

   

Total interest-bearing deposits

   

65,197

     

.31

     

57,215

     

.21

     

65,070

     

.32

     

14

     

     

64,646

     

.30

     

48,742

     

.15

     

33

   

Short-term borrowings

   

200

     

.30

     

1,615

     

.39

     

231

     

.29

     

-88

     

-14

     

894

     

.41

     

548

     

.31

     

63

   

Long-term borrowings

   

9,901

     

2.26

     

10,748

     

2.36

     

10,287

     

2.28

     

-8

     

-4

     

10,252

     

2.25

     

10,217

     

2.47

     

   

Total interest-bearing liabilities

   

75,298

     

.57

     

69,578

     

.54

     

75,588

     

.59

     

8

     

     

75,792

     

.56

     

59,507

     

.55

     

27

   

Noninterest-bearing deposits

   

31,717

             

28,443

             

30,782

             

12

     

3

     

30,160

             

27,324

             

10

   

Other liabilities

   

2,046

             

2,024

             

2,008

             

1

     

2

     

1,969

             

1,721

             

14

   

Total liabilities

   

109,061

             

100,045

             

108,378

             

9

     

1

     

107,921

             

88,552

             

22

   

Shareholders' equity

   

16,673

             

15,007

             

16,347

             

11

     

2

     

16,419

             

13,228

             

24

   

Total liabilities and shareholders' equity

 

$

125,734

             

115,052

             

124,725

             

9

 

%

 

1

 

%

$

124,340

             

101,780

             

22

 

%

                                                                                                           

Net interest spread

           

2.88

             

2.94

             

2.85

                             

2.93

             

2.95

           

Contribution of interest-free funds

           

.20

             

.18

             

.20

                             

.18

             

.19

           

Net interest margin

           

3.08

 

%

         

3.12

 

%

         

3.05

 

%

                         

3.11

 

%

         

3.14

 

%

       

 

 

Reconciliation of GAAP to Non-GAAP Measures

       
   

Three months ended

   

Year ended

 
   

December 31

   

December 31

 
   

2016

   

2015

   

2016

   

2015

 

Income statement data

                               

In thousands, except per share

                               

Net income

                               

Net income

 

$

330,571

     

270,965

     

1,315,114

     

1,079,667

 

Amortization of core deposit and other intangible assets (1)

   

5,524

     

5,828

     

25,893

     

16,150

 

Merger-related expenses (1)

   

     

60,820

     

21,685

     

60,820

 

Net operating income

 

$

336,095

     

337,613

     

1,362,692

     

1,156,637

 
                                 

Earnings per common share

                               

Diluted earnings per common share

 

$

1.98

     

1.65

     

7.78

     

7.18

 

Amortization of core deposit and other intangible assets (1)

   

.03

     

.04

     

.16

     

.12

 

Merger-related expenses (1)

   

     

.40

     

.14

     

.44

 

Diluted net operating earnings per common share

 

$

2.01

     

2.09

     

8.08

     

7.74

 
                                 

Other expense

                               

Other expense

 

$

769,103

     

786,113

     

3,047,485

     

2,822,932

 

Amortization of core deposit and other intangible assets

   

(9,089)

     

(9,576)

     

(42,613)

     

(26,424)

 

Merger-related expenses

   

     

(75,976)

     

(35,755)

     

(75,976)

 

Noninterest operating expense

 

$

760,014

     

700,561

     

2,969,117

     

2,720,532

 
                                 

Merger-related expenses

                               

Salaries and employee benefits

 

$

     

51,287

     

5,334

     

51,287

 

Equipment and net occupancy

   

     

3

     

1,278

     

3

 

Outside data processing and software

   

     

785

     

1,067

     

785

 

Advertising and marketing

   

     

79

     

10,522

     

79

 

Printing, postage and supplies

   

     

504

     

1,482

     

504

 

Other costs of operations

   

     

23,318

     

16,072

     

23,318

 

Other expense

   

     

75,976

     

35,755

     

75,976

 

Provision for credit losses

   

     

21,000

     

     

21,000

 

Total

 

$

     

96,976

     

35,755

     

96,976

 
                                 

Efficiency ratio

                               

Noninterest operating expense (numerator)

 

$

760,014

     

700,561

     

2,969,117

     

2,720,532

 

Taxable-equivalent net interest income

   

883,147

     

813,401

     

3,496,849

     

2,867,050

 

Other income

   

465,459

     

448,108

     

1,825,996

     

1,825,037

 

Less:  Gain (loss) on bank investment securities

   

1,566

     

(22)

     

30,314

     

(130)

 

Denominator

 

$

1,347,040

     

1,261,531

     

5,292,531

     

4,692,217

 

Efficiency ratio

   

56.42

%

   

55.53

%

   

56.10

%

   

57.98

%

                                 

Balance sheet data

                               

In millions

                               

Average assets

                               

Average assets

 

$

125,734

     

115,052

     

124,340

     

101,780

 

Goodwill

   

(4,593)

     

(4,218)

     

(4,593)

     

(3,694)

 

Core deposit and other intangible assets

   

(102)

     

(101)

     

(117)

     

(45)

 

Deferred taxes

   

40

     

39

     

46

     

16

 

Average tangible assets

 

$

121,079

     

110,772

     

119,676

     

98,057

 

Average common equity

                               

Average total equity

 

$

16,673

     

15,007

     

16,419

     

13,228

 

Preferred stock

   

(1,492)

     

(1,232)

     

(1,297)

     

(1,232)

 

Average common equity

   

15,181

     

13,775

     

15,122

     

11,996

 

Goodwill

   

(4,593)

     

(4,218)

     

(4,593)

     

(3,694)

 

Core deposit and other intangible assets

   

(102)

     

(101)

     

(117)

     

(45)

 

Deferred taxes

   

40

     

39

     

46

     

16

 

Average tangible common equity

 

$

10,526

     

9,495

     

10,458

     

8,273

 
                                 

At end of quarter

                               

Total assets

                               

Total assets

 

$

123,449

     

122,788

                 

Goodwill

   

(4,593)

     

(4,593)

                 

Core deposit and other intangible assets

   

(98)

     

(140)

                 

Deferred taxes

   

39

     

54

                 

Total tangible assets

 

$

118,797

     

118,109

                 

Total common equity

                               

Total equity

 

$

16,487

     

16,173

                 

Preferred stock

   

(1,232)

     

(1,232)

                 

Undeclared dividends - cumulative preferred stock

   

(3)

     

(2)

                 

Common equity, net of undeclared cumulative preferred dividends

   

15,252

     

14,939

                 

Goodwill

   

(4,593)

     

(4,593)

                 

Core deposit and other intangible assets

   

(98)

     

(140)

                 

Deferred taxes

   

39

     

54

                 

Total tangible common equity

 

$

10,600

     

10,260

                 

 

 

(1)

After any related tax effect.

 

 

Reconciliation of Quarterly GAAP to Non-GAAP Measures, Five Quarter Trend

 
   

Three months ended

 
   

December 31,

   

September 30,

   

June 30,

   

March 31,

   

December 31,

 
   

2016

   

2016

   

2016

   

2016

   

2015

 

Income statement data

                                       

In thousands, except per share

                                       

Net income

                                       

Net income

 

$

330,571

     

349,984

     

336,031

     

298,528

     

270,965

 

Amortization of core deposit and other intangible assets (1)

   

5,524

     

5,945

     

6,936

     

7,488

     

5,828

 

Merger-related expenses (1)

   

     

     

7,637

     

14,048

     

60,820

 

Net operating income

 

$

336,095

     

355,929

     

350,604

     

320,064

     

337,613

 
                                         

Earnings per common share

                                       

Diluted earnings per common share

 

$

1.98

     

2.10

     

1.98

     

1.73

     

1.65

 

Amortization of core deposit and other intangible assets (1)

   

.03

     

.03

     

.04

     

.05

     

.04

 

Merger-related expenses (1)

   

     

     

.05

     

.09

     

.40

 

Diluted net operating earnings per common share

 

$

2.01

     

2.13

     

2.07

     

1.87

     

2.09

 
                                         

Other expense

                                       

Other expense

 

$

769,103

     

752,392

     

749,895

     

776,095

     

786,113

 

Amortization of core deposit and other intangible assets

   

(9,089)

     

(9,787)

     

(11,418)

     

(12,319)

     

(9,576)

 

Merger-related expenses

   

     

     

(12,593)

     

(23,162)

     

(75,976)

 

Noninterest operating expense

 

$

760,014

     

742,605

     

725,884

     

740,614

     

700,561

 
                                         

Merger-related expenses

                                       

Salaries and employee benefits

 

$

     

     

60

     

5,274

     

51,287

 

Equipment and net occupancy

   

     

     

339

     

939

     

3

 

Outside data processing and software

   

     

     

352

     

715

     

785

 

Advertising and marketing

   

     

     

6,327

     

4,195

     

79

 

Printing, postage and supplies

   

     

     

545

     

937

     

504

 

Other costs of operations

   

     

     

4,970

     

11,102

     

23,318

 

Other expense

   

     

     

12,593

     

23,162

     

75,976

 

Provision for credit losses

   

     

     

     

     

21,000

 

Total

 

$

     

     

12,593

     

23,162

     

96,976

 
                                         

Efficiency ratio

                                       

Noninterest operating expense (numerator)

 

$

760,014

     

742,605

     

725,884

     

740,614

     

700,561

 

Taxable-equivalent net interest income

   

883,147

     

865,065

     

870,341

     

878,296

     

813,401

 

Other income

   

465,459

     

491,350

     

448,254

     

420,933

     

448,108

 

Less:  Gain (loss) on bank investment securities

   

1,566

     

28,480

     

264

     

4

     

(22)

 

Denominator

 

$

1,347,040

     

1,327,935

     

1,318,331

     

1,299,225

     

1,261,531

 

Efficiency ratio

   

56.42

%

   

55.92

%

   

55.06

%

   

57.00

%

   

55.53

%

                                         

Balance sheet data

                                       

In millions

                                       

Average assets

                                       

Average assets

 

$

125,734

     

124,725

     

123,706

     

123,252

     

115,052

 

Goodwill

   

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

     

(4,218)

 

Core deposit and other intangible assets

   

(102)

     

(112)

     

(122)

     

(134)

     

(101)

 

Deferred taxes

   

40

     

44

     

48

     

52

     

39

 

Average tangible assets

 

$

121,079

     

120,064

     

119,039

     

118,577

     

110,772

 

Average common equity

                                       

Average total equity

 

$

16,673

     

16,347

     

16,377

     

16,279

     

15,007

 

Preferred stock

   

(1,492)

     

(1,232)

     

(1,232)

     

(1,232)

     

(1,232)

 

Average common equity

   

15,181

     

15,115

     

15,145

     

15,047

     

13,775

 

Goodwill

   

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

     

(4,218)

 

Core deposit and other intangible assets

   

(102)

     

(112)

     

(122)

     

(134)

     

(101)

 

Deferred taxes

   

40

     

44

     

48

     

52

     

39

 

Average tangible common equity

 

$

10,526

     

10,454

     

10,478

     

10,372

     

9,495

 
                                         

At end of quarter

                                       

Total assets

                                       

Total assets

 

$

123,449

     

126,841

     

123,821

     

124,626

     

122,788

 

Goodwill

   

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

 

Core deposit and other intangible assets

   

(98)

     

(107)

     

(117)

     

(128)

     

(140)

 

Deferred taxes

   

39

     

42

     

46

     

50

     

54

 

Total tangible assets

 

$

118,797

     

122,183

     

119,157

     

119,955

     

118,109

 

Total common equity

                                       

Total equity

 

$

16,487

     

16,341

     

16,472

     

16,355

     

16,173

 

Preferred stock

   

(1,232)

     

(1,232)

     

(1,232)

     

(1,232)

     

(1,232)

 

Undeclared dividends - cumulative preferred stock

   

(3)

     

(3)

     

(3)

     

(3)

     

(2)

 

Common equity, net of undeclared cumulative preferred dividends

   

15,252

     

15,106

     

15,237

     

15,120

     

14,939

 

Goodwill

   

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

 

Core deposit and other intangible assets

   

(98)

     

(107)

     

(117)

     

(128)

     

(140)

 

Deferred taxes

   

39

     

42

     

46

     

50

     

54

 

Total tangible common equity

 

$

10,600

     

10,448

     

10,573

     

10,449

     

10,260

 

 

(1)

After any related tax effect.