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M&T Bank Corporation Announces 2017 Fourth Quarter And Full-Year Results
PR Newswire
BUFFALO, N.Y.

BUFFALO, N.Y., Jan. 18, 2018 -- M&T Bank Corporation ("M&T") (NYSE: MTB) today reported its results of operations for 2017.

GAAP Results of Operations.  Diluted earnings per common share measured in accordance with generally accepted accounting principles ("GAAP") for the fourth quarter of 2017 were $2.01, up 2% from $1.98 in the similar 2016 quarter.  GAAP-basis net income in the recent quarter aggregated $322 million, compared with $331 million in the final quarter of 2016.  Diluted earnings per common share and GAAP-basis net income were $2.21 and $356 million, respectively, in the third quarter of 2017.  GAAP-basis net income for the fourth quarter of 2017 expressed as an annualized rate of return on average assets and average common shareholders' equity was 1.06% and 8.03%, respectively, compared with 1.05% and 8.13%, respectively, in the year-earlier quarter and 1.18% and 8.89%, respectively, in the third quarter of 2017.

M&T's financial results for the final quarter of 2017 reflected several notable items.  The Tax Cuts and Jobs Act ("the Tax Act") was enacted on December 22, 2017, reducing the corporate Federal income tax rate from 35% to 21% and making other changes to U.S. corporate income tax laws.  GAAP requires that the impact of the provisions of the Tax Act be accounted for in the period of enactment.  Accordingly, the estimated incremental income tax expense recorded by M&T in the fourth quarter of 2017 related to the Tax Act was $85 million, representing $.56 of diluted earnings per common share.  The additional expense was largely attributable to the reduction in carrying value of net deferred tax assets reflecting lower future tax benefits resulting from the lower corporate tax rate.  Also during the recent quarter, M&T realized investment securities gains of $14 million (after-tax effect), or $.09 of diluted earnings per common share, largely resulting from the sale of a portion of M&T's Fannie Mae and Freddie Mac preferred stock holdings.  Finally, M&T contributed an additional $44 million to The M&T Charitable Foundation in the final 2017 quarter, reducing net income by $27 million, or $.18 of diluted earnings per common share.  In the aggregate, these items lowered net income by $98 million, or $.65 per diluted common share.

Earnings Highlights

 
                                         
                           

Change 4Q17 vs.

 

($ in millions, except per share data)

 

4Q17

   

4Q16

   

3Q17

   

4Q16

   

3Q17

 
                                         

Net income

 

$

322

   

$

331

   

$

356

     

-2

%

   

-9

%

Net income available to common shareholders - diluted

 

$

302

   

$

308

   

$

336

     

-2

%

   

-10

%

Diluted earnings per common share

 

$

2.01

   

$

1.98

   

$

2.21

     

2

%

   

-9

%

Annualized return on average assets

   

1.06

%

   

1.05

%

   

1.18

%

               

Annualized return on average common equity

   

8.03

%

   

8.13

%

   

8.89

%

               
                                         

For the year ended December 31, 2017, diluted earnings per common share were $8.70, up 12% from $7.78 in 2016.  GAAP-basis net income for 2017 aggregated $1.41 billion, 7% higher than $1.32 billion in 2016.  Expressed as a rate of return on average assets and average common shareholders' equity, GAAP-basis net income for 2017 was 1.17% and 8.87%, respectively, compared with 1.06% and 8.16%, respectively, in 2016.

Darren J. King, Executive Vice President and Chief Financial Officer, commented on M&T's financial performance, "Financial results in 2017 highlight what was a successful year for M&T.  Strong growth in net interest income, credit costs that were significantly below our historical norms, and well controlled expenses led to a 12% rise in earnings per common share for the year.  Fourth quarter results were negatively impacted by the newly enacted tax legislation, but a lower corporate tax rate in the future should provide many benefits to M&T.  We are proud to carry on the legacy of our long-time Chairman and Chief Executive Officer, Bob Wilmers, through investing in the communities we serve by contributing $50 million during 2017 to The M&T Charitable Foundation, the highest annual amount in our history."

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 $2.04 in the fourth quarter of 2017, compared with $2.01 in the year-earlier quarter and $2.24 in the third quarter of 2017.  Net operating income during the recent quarter was $327 million, compared with $336 million in the final quarter of 2016 and $361 million in 2017's third quarter. Expressed as an annualized rate of return on average tangible assets and average tangible common shareholders' equity, net operating income was 1.12% and 11.77%, respectively, in the recent quarter, compared with 1.10% and 11.93%, respectively, in the fourth quarter of 2016 and 1.25% and 13.03%, respectively, in the third quarter of 2017.

For the year ended December 31, 2017, diluted net operating earnings per common share were $8.82, up 9% from $8.08 in 2016.  Net operating income in 2017 increased 5% to $1.43 billion from $1.36 billion in 2016.  Expressed as a rate of return on average tangible assets and average tangible common shareholders' equity, net operating income was 1.23% and 13.00%, respectively, in 2017 and 1.14% and 12.25%, respectively, in 2016.

Taxable-equivalent Net Interest Income.  Net interest income expressed on a taxable-equivalent basis aggregated $980 million in the fourth quarter of 2017, up 11% from $883 million in the year-earlier quarter. That growth resulted predominantly from a widening of the net interest margin to 3.56% in the recent quarter from 3.08% in the final 2016 quarter. Taxable-equivalent net interest income in the recent quarter was 2% higher than $966 million in the third quarter of 2017. Contributing to that improvement were a 3 basis point widening of the net interest margin and an increase in average earning assets in the recent quarter as compared with the third quarter of 2017. Taxable-equivalent net interest income for the year ended December 31, 2017 aggregated $3.82 billion, up 9% from $3.50 billion in 2016. That improvement was predominantly the result of a widening of the net interest margin from 3.11% in 2016 to 3.47% in 2017.

                                         

Taxable-equivalent Net Interest Income

 
                                         
                           

Change 4Q17 vs.

 

($ in millions)

 

4Q17

   

4Q16

   

3Q17

   

4Q16

   

3Q17

 
                                         

Average earning assets

 

$

109,412

   

$

114,254

   

$

108,642

     

-4

%

   

1

%

Net interest income - taxable-equivalent

 

$

980

   

$

883

   

$

966

     

11

%

   

2

%

Net interest margin

   

3.56

%

   

3.08

%

   

3.53

%

               

Provision for Credit Losses/Asset Quality.  The provision for credit losses was $31 million in the fourth quarter of 2017, compared with $62 million in the year-earlier quarter and $30 million in 2017's third quarter. Net charge-offs of loans were $27 million during the recent quarter, compared with $49 million and $25 million in the fourth quarter of 2016 and the third quarter of 2017, respectively.  Expressed as an annualized percentage of average loans outstanding, net charge-offs were .12% and .22% in the final quarters of 2017 and 2016, respectively, and .11% in the third quarter of 2017.  The provision for credit losses was $168 million for the year ended December 31, 2017, compared with $190 million in 2016.  Net loan charge-offs during 2017 and 2016 totaled $140 million and $157 million, respectively, or .16% and .18%, respectively, of average loans outstanding.

Loans classified as nonaccrual totaled $883 million or 1.00% of total loans outstanding at December 31, 2017, compared with $920 million or 1.01% at December 31, 2016 and $869 million or .99% at September 30, 2017. Nonaccrual Hudson City-related residential real estate loans aggregated $215 million at December 31, 2017, compared with $190 million and $211 million at December 31, 2016 and September 30, 2017, respectively. Assets taken in foreclosure of defaulted loans totaled $112 million at December 31, 2017, compared with $139 million a year earlier and $111 million at September 30, 2017.

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 $1.02 billion at December 31, 2017, compared with $989 million at December 31, 2016 and $1.01 billion at September 30, 2017.  The allowance expressed as a percentage of outstanding loans was 1.16% at December 31, 2017, compared with 1.09% at December 31, 2016 and 1.15% at September 30, 2017.

Asset Quality Metrics

 
                                         
                           

Change 4Q17 vs.

 

($ in millions)

 

4Q17

   

4Q16

   

3Q17

   

4Q16

   

3Q17

 
                                         

At end of quarter

                                       

Nonaccrual loans

 

$

883

   

$

920

   

$

869

     

-4

%

   

2

%

Real estate and other foreclosed assets

 

$

112

   

$

139

   

$

111

     

-20

%

   

1

%

Total nonperforming assets

 

$

995

   

$

1,059

   

$

980

     

-6

%

   

1

%

Accruing loans past due 90 days or more (1)

 

$

244

   

$

301

   

$

261

     

-19

%

   

-6

%

Nonaccrual loans as % of loans outstanding

   

1.00

%

   

1.01

%

   

.99

%

               
                                         

Allowance for credit losses

 

$

1,017

   

$

989

   

$

1,013

     

3

%

   

 

Allowance for credit losses as % of loans outstanding

   

1.16

%

   

1.09

%

   

1.15

%

               
                                         

For the period

                                       

Provision for credit losses

 

$

31

   

$

62

   

$

30

     

-50

%

   

3

%

Net charge-offs

 

$

27

   

$

49

   

$

25

     

-45

%

   

9

%

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

   

.12

%

   

.22

%

   

.11

%

               
           
   

(1)

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

Noninterest Income and Expense.  Noninterest income totaled $484 million in the recent quarter, compared with $465 million in the fourth quarter of 2016 and $459 million in the third quarter of 2017.  The recent quarter's improvement as compared with the final 2016 quarter and 2017's third quarter resulted largely from higher gains on investment securities and increased trust income.

Noninterest Income

 
                                         
                           

Change 4Q17 vs.

 

($ in millions)

 

4Q17

   

4Q16

   

3Q17

   

4Q16

   

3Q17

 
                                         

Mortgage banking revenues

 

$

96

   

$

98

   

$

97

     

-2

%

   

-1

%

Service charges on deposit accounts

   

108

     

105

     

109

     

3

%

   

-1

%

Trust income

   

130

     

122

     

125

     

6

%

   

4

%

Brokerage services income

   

13

     

15

     

15

     

-16

%

   

-13

%

Trading account and foreign exchange gains

   

10

     

7

     

7

     

36

%

   

48

%

Gain on bank investment securities

   

21

     

2

     

     

     

 

Other revenues from operations

   

106

     

116

     

106

     

-8

%

   

-1

%

Total other income

 

$

484

   

$

465

   

$

459

     

4

%

   

5

%

Noninterest income aggregated $1.85 billion in 2017, up from $1.83 billion in 2016. Higher trust income, service charges on deposit accounts and credit-related fees in 2017 were the drivers of that increase.

Noninterest expense totaled $796 million in the fourth quarter of 2017, $769 million in the year-earlier quarter and $806 million in the third quarter of 2017.  Excluding expenses considered to be nonoperating in nature, such as amortization of core deposit and other intangible assets and merger-related expenses, noninterest operating expenses were $789 million in the recent quarter, $760 million in the fourth quarter of 2016 and $798 million in 2017's third quarter. The most significant factors for the rise in noninterest operating expenses in the recent quarter as compared with the final quarter of 2016 were increased contributions to The M&T Charitable Foundation and higher salaries and employee benefits expenses. The decline in noninterest operating expenses from the third quarter of 2017 resulted largely from the $50 million increase in the reserve for legal matters during the third quarter of 2017, largely offset by a $44 million increase in contributions to The M&T Charitable Foundation in 2017's fourth quarter.

Noninterest Expense

 
                                         
                           

Change 4Q17 vs.

 

($ in millions)

 

4Q17

   

4Q16

   

3Q17

   

4Q16

   

3Q17

 
                                         

Salaries and employee benefits

 

$

403

   

$

393

   

$

399

     

2

%

   

1

%

Equipment and net occupancy

   

71

     

70

     

75

     

2

%

   

-6

%

Outside data processing and software

   

50

     

44

     

46

     

14

%

   

9

%

FDIC assessments

   

24

     

29

     

24

     

-18

%

   

-1

%

Advertising and marketing

   

19

     

21

     

17

     

-8

%

   

11

%

Printing, postage and supplies

   

9

     

9

     

9

     

-1

%

   

-2

%

Amortization of core deposit and other intangible assets

   

7

     

9

     

8

     

-23

%

   

-10

%

Other costs of operations

   

213

     

194

     

228

     

10

%

   

-7

%

Total other expense

 

$

796

   

$

769

   

$

806

     

3

%

   

-1

%

                                         

For the year ended December 31, 2017, noninterest expense aggregated $3.14 billion, compared with $3.05 billion in 2016.  Noninterest operating expenses were $3.11 billion and $2.97 billion in 2017 and 2016, respectively. The higher level of such expenses in 2017 resulted largely from increased costs for salaries and employee benefits, higher charitable contributions and increases to the reserve for legal matters.

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 54.7% in the recent quarter, 56.4% in the year-earlier quarter and 56.0% in the third quarter of 2017.  The efficiency ratio for the full year 2017 was 55.1%, improved from 56.1% in 2016.

Balance Sheet.  M&T had total assets of $118.6 billion at December 31, 2017, compared with $123.4 billion at December 31, 2016. Loans and leases, net of unearned discount, aggregated $88.0 billion at the recent year-end, $2.9 billion or 3% below $90.9 billion a year earlier. Investment securities were $14.7 billion at the end of 2017, compared with $16.3 billion at December 31, 2016.  Total deposits were $92.4 billion at the recent year-end and $95.5 billion at December 31, 2016.

Total shareholders' equity was $16.3 billion at December 31, 2017 and $16.5 billion a year earlier, representing 13.70% and 13.35%, respectively, of total assets.  Common shareholders' equity was $15.0 billion, or $100.03 per share, at December 31, 2017, compared with $15.3 billion, or $97.64 per share, at December 31, 2016.  Tangible equity per common share of $69.08 at December 31, 2017 was up 2% from $67.85 at December 31, 2016.  Common shareholders' equity per share and tangible equity per common share were $99.70 and $69.02, respectively, at September 30, 2017.  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 10.93% at December 31, 2017.

In accordance with its 2017 capital plan, M&T repurchased 1,343,356 shares of its common stock during the recent quarter at an average cost per share of $166.91, for a total cost of $224 million.  During 2017, M&T repurchased a total of 7,369,105 shares of its common stock under the 2017 and 2016 capital plans at a total cost of $1.21 billion.

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 #4178049.  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 Thursday, February 1, 2018 by calling (800) 585-8367, or (404) 537-3406 for international participants, and by making reference to ID #4178049.  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

 

2017

   

2016

   

Change

   

2017

   

2016

   

Change

 

Performance

                                               

Net income

 

$

322,403

     

330,571

     

-2

%

 

$

1,408,306

     

1,315,114

     

7

%

Net income available to common shareholders

   

302,486

     

307,797

     

-2

%

   

1,327,517

     

1,223,481

     

9

%

Per common share:

                                               

Basic earnings

 

$

2.01

     

1.98

     

2

%

 

$

8.72

     

7.80

     

12

%

Diluted earnings

   

2.01

     

1.98

     

2

%

   

8.70

     

7.78

     

12

%

Cash dividends

 

$

.75

     

.70

     

7

%

 

$

3.00

     

2.80

     

7

%

Common shares outstanding:

                                               

Average - diluted (1)

   

150,348

     

155,700

     

-3

%

   

152,551

     

157,304

     

-3

%

Period end (2)

   

150,112

     

156,213

     

-4

%

   

150,112

     

156,213

     

-4

%

Return on (annualized):

                                               

Average total assets

   

1.06

%

   

1.05

%

           

1.17

%

   

1.06

%

       

Average common shareholders' equity

   

8.03

%

   

8.13

%

           

8.87

%

   

8.16

%

       

Taxable-equivalent net interest income

 

$

980,457

     

883,147

     

11

%

 

$

3,815,614

     

3,496,849

     

9

%

Yield on average earning assets

   

3.93

%

   

3.45

%

           

3.82

%

   

3.49

%

       

Cost of interest-bearing liabilities

   

.59

%

   

.57

%

           

.55

%

   

.56

%

       

Net interest spread

   

3.34

%

   

2.88

%

           

3.27

%

   

2.93

%

       

Contribution of interest-free funds

   

.22

%

   

.20

%

           

.20

%

   

.18

%

       

Net interest margin

   

3.56

%

   

3.08

%

           

3.47

%

   

3.11

%

       

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

   

.12

%

   

.22

%

           

.16

%

   

.18

%

       

Net operating results (3)

                                               

Net operating income

 

$

326,664

     

336,095

     

-3

%

 

$

1,427,331

     

1,362,692

     

5

%

Diluted net operating earnings per common share

   

2.04

     

2.01

     

1

%

   

8.82

     

8.08

     

9

%

Return on (annualized):

                                               

Average tangible assets

   

1.12

%

   

1.10

%

           

1.23

%

   

1.14

%

       

Average tangible common equity

   

11.77

%

   

11.93

%

           

13.00

%

   

12.25

%

       

Efficiency ratio

   

54.65

%

   

56.42

%

           

55.07

%

   

56.10

%

       
                                                 
   

At December 31

                             

Loan quality

 

2017

   

2016

   

Change

                         

Nonaccrual loans

 

$

882,598

     

920,015

     

-4

%

                       

Real estate and other foreclosed assets

   

111,910

     

139,206

     

-20

%

                       

Total nonperforming assets

 

$

994,508

     

1,059,221

     

-6

%

                       

Accruing loans past due 90 days or more (4)

 

$

244,405

     

300,659

     

-19

%

                       

Government guaranteed loans included in totals above:

                                               

Nonaccrual loans

 

$

35,677

     

40,610

     

-12

%

                       

Accruing loans past due 90 days or more

   

235,489

     

282,659

     

-17

%

                       

Renegotiated loans

 

$

221,513

     

190,374

     

16

%

                       

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

 

$

47,418

     

61,144

     

-22

%

                       

Purchased impaired loans (6):

                                               

Outstanding customer balance

 

$

688,091

     

927,446

     

-26

%

                       

Carrying amount

   

410,015

     

578,032

     

-29

%

                       

Nonaccrual loans to total net loans

   

1.00

%

   

1.01

%

                               

Allowance for credit losses to total loans

   

1.16

%

   

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

 

2017

   

2017

   

2017

   

2017

   

2016

 

Performance

                                       

Net income

 

$

322,403

     

355,923

     

381,053

     

348,927

     

330,571

 

Net income available to common shareholders

   

302,486

     

335,804

     

360,662

     

328,567

     

307,797

 

Per common share:

                                       

Basic earnings

 

$

2.01

     

2.22

     

2.36

     

2.13

     

1.98

 

Diluted earnings

   

2.01

     

2.21

     

2.35

     

2.12

     

1.98

 

Cash dividends

 

$

.75

     

.75

     

.75

     

.75

     

.70

 

Common shares outstanding:

                                       

Average - diluted (1)

   

150,348

     

151,691

     

153,276

     

154,949

     

155,700

 

Period end (2)

   

150,112

     

151,291

     

152,539

     

153,781

     

156,213

 

Return on (annualized):

                                       

Average total assets

   

1.06

%

   

1.18

%

   

1.27

%

   

1.15

%

   

1.05

%

Average common shareholders' equity

   

8.03

%

   

8.89

%

   

9.67

%

   

8.89

%

   

8.13

%

Taxable-equivalent net interest income

 

$

980,457

     

965,962

     

946,936

     

922,259

     

883,147

 

Yield on average earning assets

   

3.93

%

   

3.89

%

   

3.79

%

   

3.67

%

   

3.45

%

Cost of interest-bearing liabilities

   

.59

%

   

.57

%

   

.52

%

   

.52

%

   

.57

%

Net interest spread

   

3.34

%

   

3.32

%

   

3.27

%

   

3.15

%

   

2.88

%

Contribution of interest-free funds

   

.22

%

   

.21

%

   

.18

%

   

.19

%

   

.20

%

Net interest margin

   

3.56

%

   

3.53

%

   

3.45

%

   

3.34

%

   

3.08

%

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

   

.12

%

   

.11

%

   

.20

%

   

.19

%

   

.22

%

Net operating results (3)

                                       

Net operating income

 

$

326,664

     

360,658

     

385,974

     

354,035

     

336,095

 

Diluted net operating earnings per common share

   

2.04

     

2.24

     

2.38

     

2.15

     

2.01

 

Return on (annualized):

                                       

Average tangible assets

   

1.12

%

   

1.25

%

   

1.33

%

   

1.21

%

   

1.10

%

Average tangible common equity

   

11.77

%

   

13.03

%

   

14.18

%

   

13.05

%

   

11.93

%

Efficiency ratio

   

54.65

%

   

56.00

%

   

52.74

%

   

56.93

%

   

56.42

%

                                         
   

December 31,

   

September 30,

   

June 30,

   

March 31,

   

December 31,

 

Loan quality

 

2017

   

2017

   

2017

   

2017

   

2016

 

Nonaccrual loans

 

$

882,598

     

869,362

     

872,374

     

926,675

     

920,015

 

Real estate and other foreclosed assets

   

111,910

     

110,515

     

104,424

     

119,155

     

139,206

 

Total nonperforming assets

 

$

994,508

     

979,877

     

976,798

     

1,045,830

     

1,059,221

 

Accruing loans past due 90 days or more (4)

 

$

244,405

     

261,288

     

265,461

     

280,019

     

300,659

 

Government guaranteed loans included in totals above:

                                       

Nonaccrual loans

 

$

35,677

     

34,687

     

39,296

     

39,610

     

40,610

 

Accruing loans past due 90 days or more

   

235,489

     

252,072

     

235,227

     

252,552

     

282,659

 

Renegotiated loans

 

$

221,513

     

226,672

     

221,892

     

191,343

     

190,374

 

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

 

$

47,418

     

56,225

     

57,498

     

63,732

     

61,144

 

Purchased impaired loans (6):

                                       

Outstanding customer balance

 

$

688,091

     

779,340

     

838,476

     

890,431

     

927,446

 

Carrying amount

   

410,015

     

466,943

     

512,393

     

552,935

     

578,032

 

Nonaccrual loans to total net loans

   

1.00

%

   

.99

%

   

.98

%

   

1.04

%

   

1.01

%

Allowance for credit losses to total loans

   

1.16

%

   

1.15

%

   

1.13

%

   

1.12

%

   

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

 

2017

   

2016

   

Change

   

2017

   

2016

   

Change

 

Interest income

 

$

1,074,139

     

982,901

     

9

%

 

$

4,167,795

     

3,895,871

     

7

%

Interest expense

   

102,689

     

107,137

     

-4

     

386,751

     

425,984

     

-9

 

Net interest income

   

971,450

     

875,764

     

11

     

3,781,044

     

3,469,887

     

9

 

Provision for credit losses

   

31,000

     

62,000

     

-50

     

168,000

     

190,000

     

-12

 

Net interest income after provision for credit losses

   

940,450

     

813,764

     

16

     

3,613,044

     

3,279,887

     

10

 

Other income

                                               

Mortgage banking revenues

   

96,235

     

98,504

     

-2

     

363,827

     

373,697

     

-3

 

Service charges on deposit accounts

   

107,783

     

104,890

     

3

     

427,372

     

419,102

     

2

 

Trust income

   

129,669

     

122,003

     

6

     

501,381

     

472,184

     

6

 

Brokerage services income

   

12,768

     

15,233

     

-16

     

61,445

     

63,423

     

-3

 

Trading account and foreign exchange gains

   

10,468

     

7,692

     

36

     

35,301

     

41,126

     

-14

 

Gain on bank investment securities

   

21,296

     

1,566

     

     

21,279

     

30,314

     

-30

 

Other revenues from operations

   

105,834

     

115,571

     

-8

     

440,538

     

426,150

     

3

 

Total other income

   

484,053

     

465,459

     

4

     

1,851,143

     

1,825,996

     

1

 

Other expense

                                               

Salaries and employee benefits

   

402,878

     

393,354

     

2

     

1,650,729

     

1,623,600

     

2

 

Equipment and net occupancy

   

71,363

     

69,976

     

2

     

295,084

     

295,141

     

 

Outside data processing and software

   

50,033

     

43,987

     

14

     

184,670

     

172,389

     

7

 

FDIC assessments

   

23,722

     

28,991

     

-18

     

101,871

     

105,045

     

-3

 

Advertising and marketing

   

19,366

     

21,074

     

-8

     

69,203

     

87,137

     

-21

 

Printing, postage and supplies

   

8,563

     

8,681

     

-1

     

35,960

     

39,546

     

-9

 

Amortization of core deposit and other intangible assets

   

7,025

     

9,089

     

-23

     

31,366

     

42,613

     

-26

 

Other costs of operations

   

212,863

     

193,951

     

10

     

771,442

     

682,014

     

13

 

Total other expense

   

795,813

     

769,103

     

3

     

3,140,325

     

3,047,485

     

3

 

Income before income taxes

   

628,690

     

510,120

     

23

     

2,323,862

     

2,058,398

     

13

 

Applicable income taxes

   

306,287

     

179,549

     

71

     

915,556

     

743,284

     

23

 

Net income

 

$

322,403

     

330,571

     

-2

%

 

$

1,408,306

     

1,315,114

     

7

%

 

 

Condensed Consolidated Statement of Income, Five Quarter Trend

 
   

Three months ended

 
   

December 31,

   

September 30,

   

June 30,

   

March 31,

   

December 31,

 

Dollars in thousands

 

2017

   

2017

   

2017

   

2017

   

2016

 

Interest income

 

$

1,074,139

     

1,057,210

     

1,030,413

     

1,006,033

     

982,901

 

Interest expense

   

102,689

     

100,076

     

92,213

     

91,773

     

107,137

 

Net interest income

   

971,450

     

957,134

     

938,200

     

914,260

     

875,764

 

Provision for credit losses

   

31,000

     

30,000

     

52,000

     

55,000

     

62,000

 

Net interest income after provision for credit losses

   

940,450

     

927,134

     

886,200

     

859,260

     

813,764

 

Other income

                                       

Mortgage banking revenues

   

96,235

     

96,737

     

86,163

     

84,692

     

98,504

 

Service charges on deposit accounts

   

107,783

     

109,356

     

106,057

     

104,176

     

104,890

 

Trust income

   

129,669

     

124,900

     

126,797

     

120,015

     

122,003

 

Brokerage services income

   

12,768

     

14,676

     

16,617

     

17,384

     

15,233

 

Trading account and foreign exchange gains

   

10,468

     

7,058

     

8,084

     

9,691

     

7,692

 

Gain (loss) on bank investment securities

   

21,296

     

     

(17)

     

     

1,566

 

Other revenues from operations

   

105,834

     

106,702

     

117,115

     

110,887

     

115,571

 

Total other income

   

484,053

     

459,429

     

460,816

     

446,845

     

465,459

 

Other expense

                                       

Salaries and employee benefits

   

402,878

     

399,089

     

398,900

     

449,862

     

393,354

 

Equipment and net occupancy

   

71,363

     

75,558

     

73,797

     

74,366

     

69,976

 

Outside data processing and software

   

50,033

     

45,761

     

44,575

     

44,301

     

43,987

 

FDIC assessments

   

23,722

     

23,969

     

25,353

     

28,827

     

28,991

 

Advertising and marketing

   

19,366

     

17,403

     

16,324

     

16,110

     

21,074

 

Printing, postage and supplies

   

8,563

     

8,732

     

8,957

     

9,708

     

8,681

 

Amortization of core deposit and other intangible assets

   

7,025

     

7,808

     

8,113

     

8,420

     

9,089

 

Other costs of operations

   

212,863

     

227,705

     

174,616

     

156,258

     

193,951

 

Total other expense

   

795,813

     

806,025

     

750,635

     

787,852

     

769,103

 

Income before income taxes

   

628,690

     

580,538

     

596,381

     

518,253

     

510,120

 

Applicable income taxes

   

306,287

     

224,615

     

215,328

     

169,326

     

179,549

 

Net income

 

$

322,403

     

355,923

     

381,053

     

348,927

     

330,571

 

 

 

Condensed Consolidated Balance Sheet

 
   

December 31

           

Dollars in thousands

 

2017

   

2016

   

Change

   

ASSETS

                         

Cash and due from banks

 

$

1,420,888

     

1,320,549

     

8

 

%

Interest-bearing deposits at banks

   

5,078,903

     

5,000,638

     

2

   

Trading account

   

132,909

     

323,867

     

-59

   

Investment securities

   

14,664,525

     

16,250,468

     

-10

   

Loans and leases:

                         

Commercial, financial, etc.

   

21,742,651

     

22,610,047

     

-4

   

Real estate - commercial

   

33,366,373

     

33,506,394

     

   

Real estate - consumer

   

19,613,344

     

22,590,912

     

-13

   

Consumer

   

13,266,615

     

12,146,063

     

9

   

Total loans and leases, net of unearned discount

   

87,988,983

     

90,853,416

     

-3

   

Less: allowance for credit losses

   

1,017,198

     

988,997

     

3

   

Net loans and leases

   

86,971,785

     

89,864,419

     

-3

   

Goodwill

   

4,593,112

     

4,593,112

     

   

Core deposit and other intangible assets

   

71,589

     

97,655

     

-27

   

Other assets

   

5,659,776

     

5,998,498

     

-6

   

Total assets

 

$

118,593,487

     

123,449,206

     

-4

 

%

                           

LIABILITIES AND SHAREHOLDERS' EQUITY

                         

Noninterest-bearing deposits

 

$

33,975,180

     

32,813,896

     

4

 

%

Interest-bearing deposits

   

58,278,970

     

62,478,053

     

-7

   

Deposits at Cayman Islands office

   

177,996

     

201,927

     

-12

   

Total deposits

   

92,432,146

     

95,493,876

     

-3

   

Short-term borrowings

   

175,099

     

163,442

     

7

   

Accrued interest and other liabilities

   

1,593,993

     

1,811,431

     

-12

   

Long-term borrowings

   

8,141,430

     

9,493,835

     

-14

   

Total liabilities

   

102,342,668

     

106,962,584

     

-4

   

Shareholders' equity:

                         

Preferred

   

1,231,500

     

1,231,500

     

   

Common

   

15,019,319

     

15,255,122

     

-2

   

Total shareholders' equity

   

16,250,819

     

16,486,622

     

-1

   

Total liabilities and shareholders' equity

 

$

118,593,487

     

123,449,206

     

-4

 

%

 

 

Condensed Consolidated Balance Sheet, Five Quarter Trend

 
       
   

December 31,

   

September 30,

   

June 30,

   

March 31,

   

December 31,

 

Dollars in thousands

 

2017

   

2017

   

2017

   

2017

   

2016

 

ASSETS

                                       

Cash and due from banks

 

$

1,420,888

     

1,368,252

     

1,344,478

     

1,286,962

     

1,320,549

 

Interest-bearing deposits at banks

   

5,078,903

     

6,306,484

     

5,023,829

     

6,945,149

     

5,000,638

 

Federal funds sold

   

     

     

1,000

     

     

 

Trading account

   

132,909

     

170,516

     

174,646

     

174,854

     

323,867

 

Investment securities

   

14,664,525

     

15,073,926

     

15,816,060

     

15,968,415

     

16,250,468

 

Loans and leases:

                                       

Commercial, financial, etc.

   

21,742,651

     

21,743,251

     

22,191,051

     

22,295,376

     

22,610,047

 

Real estate - commercial

   

33,366,373

     

32,914,288

     

33,348,991

     

33,071,654

     

33,506,394

 

Real estate - consumer

   

19,613,344

     

20,265,162

     

20,960,171

     

21,724,491

     

22,590,912

 

Consumer

   

13,266,615

     

13,002,433

     

12,580,342

     

12,221,481

     

12,146,063

 

Total loans and leases, net of unearned discount

   

87,988,983

     

87,925,134

     

89,080,555

     

89,313,002

     

90,853,416

 

Less: allowance for credit losses

   

1,017,198

     

1,013,326

     

1,008,225

     

1,001,430

     

988,997

 

Net loans and leases

   

86,971,785

     

86,911,808

     

88,072,330

     

88,311,572

     

89,864,419

 

Goodwill

   

4,593,112

     

4,593,112

     

4,593,112

     

4,593,112

     

4,593,112

 

Core deposit and other intangible assets

   

71,589

     

78,614

     

86,422

     

94,535

     

97,655

 

Other assets

   

5,659,776

     

5,899,092

     

5,784,690

     

5,848,652

     

5,998,498

 

Total assets

 

$

118,593,487

     

120,401,804

     

120,896,567

     

123,223,251

     

123,449,206

 
                                         

LIABILITIES AND SHAREHOLDERS' EQUITY

                                       

Noninterest-bearing deposits

 

$

33,975,180

     

33,111,246

     

32,366,426

     

34,279,591

     

32,813,896

 

Interest-bearing deposits

   

58,278,970

     

60,170,133

     

60,978,895

     

62,570,167

     

62,478,053

 

Deposits at Cayman Islands office

   

177,996

     

232,014

     

195,617

     

192,763

     

201,927

 

Total deposits

   

92,432,146

     

93,513,393

     

93,540,938

     

97,042,521

     

95,493,876

 

Short-term borrowings

   

175,099

     

200,768

     

1,695,453

     

185,102

     

163,442

 

Accrued interest and other liabilities

   

1,593,993

     

1,791,946

     

1,727,059

     

1,694,905

     

1,811,431

 

Long-term borrowings

   

8,141,430

     

8,577,645

     

7,649,580

     

8,087,619

     

9,493,835

 

Total liabilities

   

102,342,668

     

104,083,752

     

104,613,030

     

107,010,147

     

106,962,584

 

Shareholders' equity:

                                       

Preferred

   

1,231,500

     

1,231,500

     

1,231,500

     

1,231,500

     

1,231,500

 

Common

   

15,019,319

     

15,086,552

     

15,052,037

     

14,981,604

     

15,255,122

 

Total shareholders' equity

   

16,250,819

     

16,318,052

     

16,283,537

     

16,213,104

     

16,486,622

 

Total liabilities and shareholders' equity

 

$

118,593,487

     

120,401,804

     

120,896,567

     

123,223,251

     

123,449,206

 

 

 

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, 2017 from

   

December 31

 

Change

Dollars in millions

 

2017

   

2016

   

2017

   

December 31,

   

September 30,

   

2017

 

2016

 

in

   

Balance

 

Rate

   

Balance

   

Rate

   

Balance

   

Rate

   

2016

   

2017

   

Balance

 

Rate

 

Balance

 

Rate

   

balance

                                                                             

ASSETS

                                                                           

Interest-bearing deposits at banks

 

$

6,680

 

1.31

%

 

8,790

   

.54

%

 

4,740

   

1.25

%

 

-24

%

 

41

%

 

$

5,578

 

1.10

%

 

8,846

 

.51

%

 

-37

%

Trading account

   

87

 

1.31

   

70

   

2.05

   

73

   

1.92

   

23

   

18

     

71

 

1.70

   

85

 

1.71

   

-16

 

Investment securities

   

14,808

 

2.30

   

15,417

   

2.28

   

15,443

   

2.28

   

-4

   

-4

     

15,538

 

2.34

   

15,009

 

2.44

   

4

 

Loans and leases, net of unearned discount

                                                                           

Commercial, financial, etc.

   

21,562

 

4.06

   

21,936

   

3.47

   

21,734

   

3.98

   

-2

   

-1

     

21,981

 

3.88

   

21,397

 

3.44

   

3

 

Real estate - commercial

   

33,138

 

4.61

   

32,822

   

4.01

   

33,257

   

4.50

   

1

   

     

33,196

 

4.40

   

30,915

 

4.06

   

7

 

Real estate - consumer

   

19,974

 

4.03

   

23,096

   

3.88

   

20,609

   

3.96

   

-14

   

-3

     

21,013

 

3.96

   

24,463

 

3.92

   

-14

 

Consumer

   

13,163

 

4.91

   

12,123

   

4.53

   

12,786

   

4.89

   

9

   

3

     

12,625

 

4.82

   

11,841

 

4.54

   

7

 

Total loans and leases, net

   

87,837

 

4.40

   

89,977

   

3.93

   

88,386

   

4.32

   

-2

   

-1

     

88,815

 

4.25

   

88,616

 

3.96

   

 

Total earning assets

   

109,412

 

3.93

   

114,254

   

3.45

   

108,642

   

3.89

   

-4

   

1

     

110,002

 

3.82

   

112,556

 

3.49

   

-2

 

Goodwill

   

4,593

       

4,593

         

4,593

         

   

     

4,593

       

4,593

       

 

Core deposit and other intangible assets

   

75

       

102

         

82

         

-27

   

-9

     

86

       

117

       

-26

 

Other assets

   

6,146

       

6,785

         

6,198

         

-9

   

-1

     

6,179

       

7,074

       

-13

 

Total assets

 

$

120,226

       

125,734

         

119,515

         

-4

%

 

1

%

 

$

120,860

       

124,340

       

-3

%

                                                                             

LIABILITIES AND
SHAREHOLDERS' EQUITY

                                                                           

Interest-bearing deposits

                                                                           

Savings and interest-checking deposits

 

$

53,436

 

.29

   

54,055

   

.20

   

53,287

   

.28

   

-1

%

 

%

 

$

53,399

 

.25

   

52,194

 

.17

   

2

%

Time deposits

   

6,888

 

.70

   

10,936

   

.86

   

7,673

   

.72

   

-37

   

-10

     

8,161

 

.75

   

12,253

 

.84

   

-33

 

Deposits at Cayman Island office

   

215

 

.61

   

206

   

.42

   

169

   

.73

   

4

   

27

     

185

 

.64

   

199

 

.40

   

-7

 

Total interest-bearing deposits

   

60,539

 

.34

   

65,197

   

.31

   

61,129

   

.34

   

-7

   

-1

     

61,745

 

.32

   

64,646

 

.30

   

-4

 

Short-term borrowings

   

178

 

.81

   

200

   

.30

   

244

   

.90

   

-11

   

-27

     

205

 

.74

   

894

 

.41

   

-77

 

Long-term borrowings

   

8,464

 

2.37

   

9,901

   

2.26

   

8,033

   

2.35

   

-15

   

5

     

8,302

 

2.28

   

10,252

 

2.25

   

-19

 

Total interest-bearing liabilities

   

69,181

 

.59

   

75,298

   

.57

   

69,406

   

.57

   

-8

   

     

70,252

 

.55

   

75,792

 

.56

   

-7

 

Noninterest-bearing deposits

   

32,930

       

31,717

         

32,005

         

4

   

3

     

32,520

       

30,160

       

8

 

Other liabilities

   

1,844

       

2,046

         

1,803

         

-10

   

2

     

1,793

       

1,969

       

-9

 

Total liabilities

   

103,955

       

109,061

         

103,214

         

-5

   

1

     

104,565

       

107,921

       

-3

 

Shareholders' equity

   

16,271

       

16,673

         

16,301

         

-2

   

     

16,295

       

16,419

       

-1

 

Total liabilities and shareholders' equity

 

$

120,226

       

125,734

         

119,515

         

-4

%

 

1

%

 

$

120,860

       

124,340

       

-3

%

                                                                             

Net interest spread

       

3.34

         

2.88

         

3.32

                     

3.27

       

2.93

       

Contribution of interest-free funds

       

.22

         

.20

         

.21

                     

.20

       

.18

       

Net interest margin

       

3.56

%

       

3.08

%

       

3.53

%

                   

3.47

%

     

3.11

%

     

 

 

Reconciliation of GAAP to Non-GAAP Measures

           
             
   

Three months ended

   

Year ended

 
   

December 31

   

December 31

 
   

2017

   

2016

   

2017

   

2016

 

Income statement data

                               

In thousands, except per share

                               

Net income

                               

Net income

 

$

322,403

     

330,571

     

1,408,306

     

1,315,114

 

Amortization of core deposit and other intangible assets (1)

   

4,261

     

5,524

     

19,025

     

25,893

 

Merger-related expenses (1)

   

     

     

     

21,685

 

Net operating income

 

$

326,664

     

336,095

     

1,427,331

     

1,362,692

 
                                 

Earnings per common share

                               

Diluted earnings per common share

 

$

2.01

     

1.98

     

8.70

     

7.78

 

Amortization of core deposit and other intangible assets (1)

   

.03

     

.03

     

.12

     

.16

 

Merger-related expenses (1)

   

     

     

     

.14

 

Diluted net operating earnings per common share

 

$

2.04

     

2.01

     

8.82

     

8.08

 
                                 

Other expense

                               

Other expense

 

$

795,813

     

769,103

     

3,140,325

     

3,047,485

 

Amortization of core deposit and other intangible assets

   

(7,025)

     

(9,089)

     

(31,366)

     

(42,613)

 

Merger-related expenses

   

     

     

     

(35,755)

 

Noninterest operating expense

 

$

788,788

     

760,014

     

3,108,959

     

2,969,117

 
                                 

Merger-related expenses

                               

Salaries and employee benefits

 

$

     

     

     

5,334

 

Equipment and net occupancy

   

     

     

     

1,278

 

Outside data processing and software

   

     

     

     

1,067

 

Advertising and marketing

   

     

     

     

10,522

 

Printing, postage and supplies

   

     

     

     

1,482

 

Other costs of operations

   

     

     

     

16,072

 

Total

 

$

     

     

     

35,755

 
                                 

Efficiency ratio

                               

Noninterest operating expense (numerator)

 

$

788,788

     

760,014

     

3,108,959

     

2,969,117

 

Taxable-equivalent net interest income

   

980,457

     

883,147

     

3,815,614

     

3,496,849

 

Other income

   

484,053

     

465,459

     

1,851,143

     

1,825,996

 

Less:  Gain on bank investment securities

   

21,296

     

1,566

     

21,279

     

30,314

 

Denominator

 

$

1,443,214

     

1,347,040

     

5,645,478

     

5,292,531

 

Efficiency ratio

   

54.65

%

   

56.42

%

   

55.07

%

   

56.10

%

                                 

Balance sheet data

                               

In millions

                               

Average assets

                               

Average assets

 

$

120,226

     

125,734

     

120,860

     

124,340

 

Goodwill

   

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

 

Core deposit and other intangible assets

   

(75)

     

(102)

     

(86)

     

(117)

 

Deferred taxes

   

26

     

40

     

33

     

46

 

Average tangible assets

 

$

115,584

     

121,079

     

116,214

     

119,676

 

Average common equity

                               

Average total equity

 

$

16,271

     

16,673

     

16,295

     

16,419

 

Preferred stock

   

(1,232)

     

(1,492)

     

(1,232)

     

(1,297)

 

Average common equity

   

15,039

     

15,181

     

15,063

     

15,122

 

Goodwill

   

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

 

Core deposit and other intangible assets

   

(75)

     

(102)

     

(86)

     

(117)

 

Deferred taxes

   

26

     

40

     

33

     

46

 

Average tangible common equity

 

$

10,397

     

10,526

     

10,417

     

10,458

 
                                 

At end of quarter

                               

Total assets

                               

Total assets

 

$

118,593

     

123,449

                 

Goodwill

   

(4,593)

     

(4,593)

                 

Core deposit and other intangible assets

   

(72)

     

(98)

                 

Deferred taxes

   

19

     

39

                 

Total tangible assets

 

$

113,947

     

118,797

                 

Total common equity

                               

Total equity

 

$

16,251

     

16,487

                 

Preferred stock

   

(1,232)

     

(1,232)

                 

Undeclared dividends - cumulative preferred stock

   

(3)

     

(3)

                 

Common equity, net of undeclared cumulative preferred dividends

   

15,016

     

15,252

                 

Goodwill

   

(4,593)

     

(4,593)

                 

Core deposit and other intangible assets

   

(72)

     

(98)

                 

Deferred taxes

   

19

     

39

                 

Total tangible common equity

 

$

10,370

     

10,600

                 
             

(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,

 
   

2017

   

2017

   

2017

   

2017

   

2016

 

Income statement data

                                       

In thousands, except per share

                                       

Net income

                                       

Net income

 

$

322,403

     

355,923

     

381,053

     

348,927

     

330,571

 

Amortization of core deposit and other intangible assets (1)

   

4,261

     

4,735

     

4,921

     

5,108

     

5,524

 

Net operating income

 

$

326,664

     

360,658

     

385,974

     

354,035

     

336,095

 
                                         

Earnings per common share

                                       

Diluted earnings per common share

 

$

2.01

     

2.21

     

2.35

     

2.12

     

1.98

 

Amortization of core deposit and other intangible assets (1)

   

.03

     

.03

     

.03

     

.03

     

.03

 

Diluted net operating earnings per common share

 

$

2.04

     

2.24

     

2.38

     

2.15

     

2.01

 
                                         

Other expense

                                       

Other expense

 

$

795,813

     

806,025

     

750,635

     

787,852

     

769,103

 

Amortization of core deposit and other intangible assets

   

(7,025)

     

(7,808)

     

(8,113)

     

(8,420)

     

(9,089)

 

Noninterest operating expense

 

$

788,788

     

798,217

     

742,522

     

779,432

     

760,014

 
                                         

Efficiency ratio

                                       

Noninterest operating expense (numerator)

 

$

788,788

     

798,217

     

742,522

     

779,432

     

760,014

 

Taxable-equivalent net interest income

   

980,457

     

965,962

     

946,936

     

922,259

     

883,147

 

Other income

   

484,053

     

459,429

     

460,816

     

446,845

     

465,459

 

Less:  Gain (loss) on bank investment securities

   

21,296

     

     

(17)

     

     

1,566

 

Denominator

 

$

1,443,214

     

1,425,391

     

1,407,769

     

1,369,104

     

1,347,040

 

Efficiency ratio

   

54.65

%

   

56.00

%

   

52.74

%

   

56.93

%

   

56.42

%

                                         

Balance sheet data

                                       

In millions

                                       

Average assets

                                       

Average assets

 

$

120,226

     

119,515

     

120,765

     

122,978

     

125,734

 

Goodwill

   

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

 

Core deposit and other intangible assets

   

(75)

     

(82)

     

(90)

     

(98)

     

(102)

 

Deferred taxes

   

26

     

32

     

35

     

39

     

40

 

Average tangible assets

 

$

115,584

     

114,872

     

116,117

     

118,326

     

121,079

 
                                         

Average common equity

                                       

Average total equity

 

$

16,271

     

16,301

     

16,285

     

16,323

     

16,673

 

Preferred stock

   

(1,232)

     

(1,232)

     

(1,232)

     

(1,232)

     

(1,492)

 

Average common equity

   

15,039

     

15,069

     

15,053

     

15,091

     

15,181

 

Goodwill

   

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

 

Core deposit and other intangible assets

   

(75)

     

(82)

     

(90)

     

(98)

     

(102)

 

Deferred taxes

   

26

     

32

     

35

     

39

     

40

 

Average tangible common equity

 

$

10,397

     

10,426

     

10,405

     

10,439

     

10,526

 
                                         

At end of quarter

                                       

Total assets

                                       

Total assets

 

$

118,593

     

120,402

     

120,897

     

123,223

     

123,449

 

Goodwill

   

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

 

Core deposit and other intangible assets

   

(72)

     

(79)

     

(86)

     

(95)

     

(98)

 

Deferred taxes

   

19

     

31

     

33

     

38

     

39

 

Total tangible assets

 

$

113,947

     

115,761

     

116,251

     

118,573

     

118,797

 
                                         

Total common equity

                                       

Total equity

 

$

16,251

     

16,318

     

16,284

     

16,213

     

16,487

 

Preferred stock

   

(1,232)

     

(1,232)

     

(1,232)

     

(1,232)

     

(1,232)

 

Undeclared dividends - cumulative preferred stock

   

(3)

     

(3)

     

(3)

     

(3)

     

(3)

 

Common equity, net of undeclared cumulative preferred dividends

   

15,016

     

15,083

     

15,049

     

14,978

     

15,252

 

Goodwill

   

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

     

(4,593)

 

Core deposit and other intangible assets

   

(72)

     

(79)

     

(86)

     

(95)

     

(98)

 

Deferred taxes

   

19

     

31

     

33

     

38

     

39

 

Total tangible common equity

 

$

10,370

     

10,442

     

10,403

     

10,328

     

10,600

 
             

(1)     After any related tax effect.

 

 

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