UCBI
$30.83
United Comm Banks
($.27)
(.87%)
Earnings Details
3rd Quarter September 2019
Tuesday, October 22, 2019 5:00:00 PM
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Summary

United Comm Banks (UCBI) Recent Earnings

United Comm Banks (UCBI) reported 3rd Quarter September 2019 earnings of $0.63 per share on revenue of $169.6 million. The consensus earnings estimate was $0.58 per share on revenue of $143.3 million. Revenue grew 11.0% on a year-over-year basis.

United Community Banks Inc is a bank holding company. It offers a range of retail and corporate banking services, including checking, savings, and time deposit accounts, secured and unsecured loans, wire transfers, brokerage services.

Results
Reported Earnings
$0.63
Earnings Whisper
-
Consensus Estimate
$0.58
Reported Revenue
$169.6 Mil
Revenue Estimate
$143.3 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

United Community Banks, Inc. reports Third Quarter Results

GREENVILLE, S.C., Oct. 22, 2019 (GLOBE NEWSWIRE) -- United Community Banks, Inc. (NASDAQ: UCBI) (“United”) today reported strong third quarter financial results, including solid year-over-year loan and deposit growth, record operating efficiency and strong asset quality. Diluted earnings per share were $0.60, an increase of $0.06 or 11% from a year ago. Excluding merger-related and other charges, diluted operating earnings per share were $0.63, up 15% over last year. United’s return on assets (“ROA”) was 1.51% and its return on common equity was 12.2% for the quarter. On an operating basis, United’s ROA was 1.58% and its return on tangible common equity was 16.4%.

In the third quarter, loans grew at a 3% annualized rate, or at 4% annualized excluding the planned runoff of the discontinued indirect auto portfolio. With this loan growth and continued balance sheet remixing opportunities, United maintained its net interest margin during the quarter, despite declining interest rates. Core transaction deposits grew by $105 million, or 6% annualized, and total customer deposits increased by $197 million during the quarter. Finally, United’s combination of revenue growth and expense management resulted in a 55.64% efficiency ratio, or 53.90% on an operating basis, which represented a new Company best for the second consecutive quarter.

“We are pleased to report such a successful quarter, which is a testament to our team and their tireless dedication to providing outstanding customer service and to executing on our plans to deliver top quartile results,” said Lynn Harton, Chairman and CEO of United. “I am also tremendously proud that United was named one of the "Best Banks to Work For" by American Banker for the third year in a row.  This honor is achieved through the focus and energy of our bankers to build a company where great people can find fulfillment in helping others reach their financial goals."

Third Quarter 2019 Financial Highlights:

  • EPS growth of 11% over last year, or 15% on an operating basis
  • Return on assets of 1.51%, or 1.58% excluding merger-related and other charges
  • Return on common equity of 12.2%
  • Return on tangible common equity of 16.4% excluding merger-related and other charges
  • Loan production of $896 million compared to $778 million in Q3 2018
  • Loan growth, excluding planned runoff of the indirect portfolio of 4% for the quarter and 7% year-to-date on an annualized basis, excluding the acquisition of First Madison on May 1, 2019
  • Loan growth of $89 million, excluding planned run off of the indirect portfolio, was more than funded by core transaction deposit growth of $105 million
  • Mortgage locks of $508 million, a company high, compared to $298 million a year ago
  • Stable net interest margin of 4.12% was flat compared to the second quarter and up 17 basis points from a year ago
  • Efficiency ratio of 55.64%, or 53.90%, excluding merger-related and other charges
  • Net charge-offs of 12 basis points, up one basis point from last quarter and remaining at historically low levels
  • Nonperforming assets of 0.24% of total assets, compared with 0.21% at June 30, 2019 and 0.19% at September 30, 2018
  • Repurchased approximately 195,000 shares at an average price of $26.51 in the quarter

Conference Call
United will hold a conference call, Wednesday, October 23, 2019, at 11 a.m. ET to discuss the contents of this press release and to share business highlights for the quarter. To access the call, dial (877) 380-5665 and use the conference number 8899475. The conference call also will be webcast and available for replay for 30 days by selecting “Events & Presentations” within the Investor Relations section of United’s website at www.ucbi.com.

UNITED COMMUNITY BANKS, INC.                  
Selected Financial Information                  
  2019 2018 Third Quarter 2019 - 2018 Change For the Nine Months Ended September 30, YTD 2019 - 2018 Change
(in thousands, except per share data) Third Quarter Second Quarter First Quarter Fourth Quarter Third Quarter  2019 2018 
INCOME SUMMARY                  
Interest revenue $140,615  $139,156  $136,516  $133,854  $128,721    $416,287  $366,226   
Interest expense 21,277  21,372  20,882  18,975  16,611    63,531  42,355   
Net interest revenue 119,338  117,784  115,634  114,879  112,110  6% 352,756  323,871  9%
Provision for credit losses 3,100  3,250  3,300  2,100  1,800  72  9,650  7,400  30 
Noninterest income 29,031  24,531  20,968  23,045  24,180  20  74,530  69,916  7 
Total revenue 145,269  139,065  133,302  135,824  134,490  8  417,636  386,387  8 
Expenses 82,924  81,813  76,084  78,242  77,718  7  240,821  228,043  6 
Income before income tax expense 62,345  57,252  57,218  57,582  56,772  10  176,815  158,344  12 
Income tax expense 13,983  13,167  12,956  12,445  13,090  7  40,106  37,370  7 
Net income 48,362  44,085  44,262  45,137  43,682  11  136,709  120,974  13 
Merger-related and other charges 2,605  4,087  739  1,234  592    7,431  6,111   
Income tax benefit of merger-related and other charges (600) (940) (172) (604) (141)   (1,712) (890)  
Net income - operating (1) $50,367  $47,232  $44,829  $45,767  $44,133  14  $142,428  $126,195  13 
                   
PERFORMANCE MEASURES                  
Per common share:                  
Diluted net income - GAAP $0.60  $0.55  $0.55  $0.56  $0.54  11  $1.70  $1.51  13 
Diluted net income - operating (1) 0.63  0.59  0.56  0.57  0.55  15  1.77  1.57  13 
Cash dividends declared 0.17  0.17  0.16  0.16  0.15  13  0.50  0.42  19 
Book value 20.16  19.65  18.93  18.24  17.56  15  20.16  17.56  15 
Tangible book value (3) 15.90  15.38  14.93  14.24  13.54  17  15.90  13.54  17 
Key performance ratios:                  
Return on common equity - GAAP (2)(4) 12.16% 11.45% 11.85% 12.08% 11.96%   11.83% 11.43%  
Return on common equity - operating (1)(2)(4) 12.67  12.27  12.00  12.25  12.09    12.32  11.93   
Return on tangible common equity - operating (1)(2)(3)(4) 16.38  15.88  15.46  15.88  15.81    15.92  15.62   
Return on assets - GAAP (4) 1.51  1.40  1.44  1.43  1.41    1.45  1.32   
Return on assets - operating (1)(4) 1.58  1.50  1.45  1.45  1.42    1.51  1.38   
Net interest margin (fully taxable equivalent) (4) 4.12  4.12  4.10  3.97  3.95    4.11  3.88   
Efficiency ratio - GAAP 55.64  57.28  55.32  56.73  56.82    56.09  57.52   
Efficiency ratio - operating (1) 53.90  54.42  54.78  55.83  56.39    54.36  55.98   
Equity to total assets 12.53  12.25  12.06  11.60  11.30    12.53  11.30   
Tangible common equity to tangible assets (3) 10.16  9.86  9.76  9.29  8.95    10.16  8.95   
                   
ASSET QUALITY                  
Nonperforming loans $30,832  $26,597  $23,624  $23,778  $22,530  37  $30,832  $22,530  37 
Foreclosed properties 102  75  1,127  1,305  1,336  (92) 102  1,336  (92)
Total nonperforming assets ("NPAs") 30,934  26,672  24,751  25,083  23,866  30  30,934  23,866  30 
Allowance for loan losses 62,514  62,204  61,642  61,203  60,940  3  62,514  60,940  3 
Net charge-offs 2,723  2,438  3,130  1,787  1,466  86  8,291  4,326  92 
Allowance for loan losses to loans 0.70% 0.70% 0.73% 0.73% 0.74%   0.70% 0.74%  
Net charge-offs to average loans (4) 0.12  0.11  0.15  0.09  0.07    0.13  0.07   
NPAs to loans and foreclosed properties 0.35  0.30  0.29  0.30  0.29    0.35  0.29   
NPAs to total assets 0.24  0.21  0.20  0.20  0.19    0.24  0.19   
                   
AVERAGE BALANCES ($ in millions)                  
Loans $8,836  $8,670  $8,430  $8,306  $8,200  8  $8,647  $8,124  6 
Investment securities 2,550  2,674  2,883  3,004  2,916  (13) 2,701  2,863  (6)
Earning assets 11,568  11,534  11,498  11,534  11,320  2  11,534  11,197  3 
Total assets 12,681  12,608  12,509  12,505  12,302  3  12,600  12,209  3 
Deposits 10,531  10,493  10,361  10,306  9,950  6  10,462  9,896  6 
Shareholders’ equity 1,588  1,531  1,478  1,420  1,394  14  1,533  1,367  12 
Common shares - basic (thousands) 79,663  79,673  79,807  79,884  79,806    79,714  79,588   
Common shares - diluted (thousands) 79,667  79,678  79,813  79,890  79,818    79,718  79,598   
                   
AT PERIOD END ($ in millions)                  
Loans $8,903  $8,838  $8,493  $8,383  $8,226  8  $8,903  $8,226  8 
Investment securities 2,515  2,620  2,720  2,903  2,873  (12) 2,515  2,873  (12)
Total assets 12,809  12,779  12,506  12,573  12,405  3  12,809  12,405  3 
Deposits 10,757  10,591  10,534  10,535  10,229  5  10,757  10,229  5 
Shareholders’ equity 1,605  1,566  1,508  1,458  1,402  14  1,605  1,402  14 
Common shares outstanding (thousands) 78,974  79,075  79,035  79,234  79,202    78,974  79,202   
                            

(1) Excludes merger-related and other charges which includes termination of pension plan in the third quarter of 2019, executive retirement charges in the second quarter of 2019 and amortization of certain executive change of control benefits. (2) Net income divided by average realized common equity, which excludes accumulated other comprehensive income (loss). (3) Excludes effect of acquisition related intangibles and associated amortization. (4) Annualized.

UNITED COMMUNITY BANKS, INC.              
Non-GAAP Performance Measures Reconciliation
Selected Financial Information              
  2019 2018 For the Nine Months Ended September 30,
(in thousands, except per share data) Third Quarter Second Quarter First Quarter Fourth Quarter Third Quarter 2019 2018
               
Expense reconciliation              
Expenses (GAAP) $82,924  $81,813  $76,084  $78,242  $77,718  $240,821  $228,043 
Merger-related and other charges (2,605) (4,087) (739) (1,234) (592) (7,431) (6,111)
Expenses - operating $80,319  $77,726  $75,345  $77,008  $77,126  $233,390  $221,932 
               
Net income reconciliation              
Net income (GAAP) $48,362  $44,085  $44,262  $45,137  $43,682  $136,709  $120,974 
Merger-related and other charges 2,605  4,087  739  1,234  592  7,431  6,111 
Income tax benefit of merger-related and other charges (600) (940) (172) (604) (141) (1,712) (890)
Net income - operating $50,367  $47,232  $44,829  $45,767  $44,133  $142,428  $126,195 
               
Diluted income per common share reconciliation              
Diluted income per common share (GAAP) $0.60  $0.55  $0.55  $0.56  $0.54  $1.70  $1.51 
Merger-related and other charges 0.03  0.04  0.01  0.01  0.01  0.07  0.06 
Diluted income per common share - operating $0.63  $0.59  $0.56  $0.57  $0.55  $1.77  $1.57 
               
Book value per common share reconciliation              
Book value per common share (GAAP) $20.16  $19.65  $18.93  $18.24  $17.56  $20.16  $17.56 
Effect of goodwill and other intangibles (4.26) (4.27) (4.00) (4.00) (4.02) (4.26) (4.02)
Tangible book value per common share $15.90  $15.38  $14.93  $14.24  $13.54  $15.90  $13.54 
               
Return on tangible common equity reconciliation              
Return on common equity (GAAP) 12.16% 11.45% 11.85% 12.08% 11.96% 11.83% 11.43%
Merger-related and other charges 0.51  0.82  0.15  0.17  0.13  0.49  0.50 
Return on common equity - operating 12.67  12.27  12.00  12.25  12.09  12.32  11.93 
Effect of goodwill and other intangibles 3.71  3.61  3.46  3.63  3.72  3.60  3.69 
Return on tangible common equity - operating 16.38% 15.88% 15.46% 15.88% 15.81% 15.92% 15.62%
               
Return on assets reconciliation              
Return on assets (GAAP) 1.51% 1.40% 1.44% 1.43% 1.41% 1.45% 1.32%
Merger-related and other charges 0.07  0.10  0.01  0.02  0.01  0.06  0.06 
Return on assets - operating 1.58% 1.50% 1.45% 1.45% 1.42% 1.51% 1.38%
               
Efficiency ratio reconciliation              
Efficiency ratio (GAAP) 55.64% 57.28% 55.32% 56.73% 56.82% 56.09% 57.52%
Merger-related and other charges (1.74) (2.86) (0.54) (0.90) (0.43) (1.73) (1.54)
Efficiency ratio - operating 53.90% 54.42% 54.78% 55.83% 56.39% 54.36% 55.98%
               
Tangible common equity to tangible assets reconciliation              
Equity to total assets (GAAP) 12.53% 12.25% 12.06% 11.60% 11.30% 12.53% 11.30%
Effect of goodwill and other intangibles (2.37) (2.39) (2.30) (2.31) (2.35) (2.37) (2.35)
Tangible common equity to tangible assets 10.16% 9.86% 9.76% 9.29% 8.95% 10.16% 8.95%
                      


UNITED COMMUNITY BANKS, INC.            
Financial Highlights            
Loan Portfolio Composition at Period-End            
              
 2019 2018 Linked Quarter Change Year over Year Change
(in millions)Third Quarter Second Quarter First Quarter Fourth Quarter Third Quarter  
LOANS BY CATEGORY             
Owner occupied commercial RE$1,692  $1,658  $1,620  $1,648  $1,673  $34  $19 
Income producing commercial RE1,934  1,939  1,867  1,812  1,788  (5) 146 
Commercial & industrial1,271  1,299  1,284  1,278  1,194  (28) 77 
Commercial construction1,001  983  866  796  761  18  240 
Equipment financing729  674  606  565  509  55  220 
Total commercial6,627  6,553  6,243  6,099  5,925  74  702 
Residential mortgage1,121  1,108  1,064  1,049  1,035  13  86 
Home equity lines of credit669  675  684  694  702  (6) (33)
Residential construction229  219  200  211  198  10  31 
Consumer257  283  302  330  366  (26) (109)
Total loans$8,903  $8,838  $8,493  $8,383  $8,226  $65  $677 
              
LOANS BY MARKET             
North Georgia$1,002  $1,002  $970  $981  $992    10 
Atlanta1,740  1,745  1,524  1,507  1,493  (5) 247 
North Carolina1,117  1,084  1,074  1,072  1,078  33  39 
Coastal Georgia611  604  603  588  610  7  1 
Gainesville246  244  243  247  235  2  11 
East Tennessee435  446  458  477  460  (11) (25)
South Carolina1,705  1,674  1,674  1,645  1,586  31  119 
Commercial Banking Solutions1,916  1,884  1,766  1,658  1,530  32  386 
Indirect auto131  155  181  208  242  (24) (111)
Total loans$8,903  $8,838  $8,493  $8,383  $8,226  $65  $677 
                            


UNITED COMMUNITY BANKS, INC.       
Financial Highlights       
Credit Quality       
  2019 
(in thousands) Third Quarter Second Quarter First Quarter 
NONACCRUAL LOANS       
Owner occupied RE $8,430  $8,177  $7,030  
Income producing RE 2,030  1,331  1,276  
Commercial & industrial 2,625  2,366  1,666  
Commercial construction 1,894  1,650  473  
Equipment financing 1,974  2,047  1,813  
Total commercial 16,953  15,571  12,258  
Residential mortgage 9,475  8,012  8,281  
Home equity lines of credit 3,065  1,978  2,233  
Residential construction 597  494  347  
Consumer 742  542  505  
Total $30,832  $26,597  $23,624  
        
NONACCRUAL LOANS ACTIVITY       
Beginning Balance $26,597  $23,624  $23,778  
Loans placed on non-accrual 8,722  8,316  6,759  
Payments received (2,107) (3,212) (3,520) 
Loan charge-offs (2,278) (2,131) (2,714) 
Foreclosures (102)   (679) 
Ending Balance $30,832  $26,597  $23,624  


  2019
  Third Quarter Second Quarter First Quarter
(in thousands) Net Charge-Offs Net Charge-Offs to Average Loans (1) Net Charge-Offs Net Charge-Offs to Average Loans (1) Net Charge-Offs Net Charge-Offs to Average Loans (1)
NET CHARGE-OFFS BY CATEGORY            
Owner occupied RE $(39) (0.01)% $(58) (0.01)% $(64) (0.02)%
Income producing RE 431  0.09  241  0.05  177  0.04 
Commercial & industrial 691  0.21  1,141  0.35  1,356  0.43 
Commercial construction (247) (0.10) (162) (0.07) (325) (0.16)
Equipment financing 1,174  0.67  890  0.56  1,281  0.89 
Total commercial 2,010  0.12  2,052  0.13  2,425  0.16 
Residential mortgage 158  0.06  (125) (0.05) 13   
Home equity lines of credit 83  0.05  (111) (0.07) 215  0.13 
Residential construction (5) (0.01) 199  0.38  (22) (0.04)
Consumer 477  0.70  423  0.58  499  0.64 
Total $2,723  0.12  $2,438  0.11  $3,130  0.15 
             
(1)  Annualized.            
             


UNITED COMMUNITY BANKS, INC.
Consolidated Balance Sheets (Unaudited)
(in thousands, except share and per share data) September 30, 2019 December 31, 2018
ASSETS    
Cash and due from banks $108,389  $126,083 
Interest-bearing deposits in banks (includes restricted cash of $5,326 and $6,702) 252,670  201,182 
Cash and cash equivalents 361,059  327,265 
Debt securities available for sale 2,272,046  2,628,467 
Debt securities held to maturity (fair value $248,546 and $268,803) 243,028  274,407 
Loans held for sale at fair value 54,625  18,935 
Loans and leases, net of unearned income 8,903,266  8,383,401 
Less allowance for loan and lease losses (62,514) (61,203)
Loans and leases, net 8,840,752  8,322,198 
Premises and equipment, net 215,435  206,140 
Bank owned life insurance 201,955  192,616 
Accrued interest receivable 33,233  35,413 
Net deferred tax asset 34,591  64,224 
Derivative financial instruments 43,755  24,705 
Goodwill and other intangible assets 343,340  324,072 
Other assets 165,667  154,750 
Total assets $12,809,486  $12,573,192 
LIABILITIES AND SHAREHOLDERS' EQUITY    
Liabilities:    
Deposits:    
Noninterest-bearing demand $3,527,815  $3,210,220 
NOW and interest-bearing demand 2,210,352  2,369,631 
Money market 2,206,496  2,002,670 
Savings 699,131  669,886 
Time 1,890,431  1,598,391 
Brokered 222,292  683,715 
Total deposits 10,756,517  10,534,513 
Federal Home Loan Bank advances 40,000  160,000 
Long-term debt 240,245  267,189 
Derivative financial instruments 16,244  26,433 
Accrued expenses and other liabilities 151,055  127,503 
Total liabilities 11,204,061  11,115,638 
Shareholders' equity:    
Common stock, $1 par value; 150,000,000 shares authorized; 78,974,199 and 79,234,077  shares issued and outstanding 78,974  79,234 
Common stock issuable; 660,581 and 674,499 shares 11,327  10,744 
Capital surplus 1,495,267  1,499,584 
Retained earnings (accumulated deficit) 5,594  (90,419)
Accumulated other comprehensive income (loss) 14,263  (41,589)
Total shareholders' equity 1,605,425  1,457,554 
Total liabilities and shareholders' equity $12,809,486  $12,573,192 
         


UNITED COMMUNITY BANKS, INC.
Consolidated Statements of Income (Unaudited)
  Three Months Ended September 30, Nine Months Ended September 30,
(in thousands, except per share data) 2019 2018 2019 2018
Interest revenue:        
Loans, including fees $122,645  $108,335  $357,575  $308,296 
Investment securities, including tax exempt of $1,118 and $1,052, and $3,409 and $3,049 17,744  19,899  57,638  56,448 
Deposits in banks and short-term investments 226  487  1,074  1,482 
Total interest revenue 140,615  128,721  416,287  366,226 
         
Interest expense:        
Deposits:        
NOW and interest-bearing demand 3,214  1,985  10,283  4,483 
Money market 5,126  3,177  14,100  7,853 
Savings 41  33  115  117 
Time 8,732  5,746  25,687  12,900 
Total deposit interest expense 17,113  10,941  50,185  25,353 
Short-term borrowings 429  274  838  772 
Federal Home Loan Bank advances 521  1,791  2,695  5,551 
Long-term debt 3,214  3,605  9,813  10,679 
Total interest expense 21,277  16,611  63,531  42,355 
Net interest revenue 119,338  112,110  352,756  323,871 
Provision for credit losses 3,100  1,800  9,650  7,400 
Net interest revenue after provision for credit losses 116,238  110,310  343,106  316,471 
         
Noninterest income:        
Service charges and fees 9,916  9,112  27,429  26,831 
Mortgage loan and other related fees 8,658  5,262  17,750  15,928 
Brokerage fees 1,699  1,525  4,624  3,598 
Gains from sales of SBA/USDA loans 1,639  2,605  4,412  6,784 
Securities gains (losses), net   2  (118) (1,302)
Other 7,119  5,674  20,433  18,077 
Total noninterest income 29,031  24,180  74,530  69,916 
Total revenue 145,269  134,490  417,636  386,387 
         
Noninterest expenses:        
Salaries and employee benefits 50,501  47,146  146,161  135,384 
Communications and equipment 6,223  5,590  18,233  15,071 
Occupancy 5,921  5,779  17,424  16,939 
Advertising and public relations 1,374  1,442  4,256  4,341 
Postage, printing and supplies 1,618  1,574  4,733  4,896 
Professional fees 4,715  3,927  11,930  11,435 
FDIC assessments and other regulatory charges 314  2,228  3,571  6,677 
Amortization of intangibles 1,210  1,681  3,845  5,426 
Merger-related and other charges 2,541  115  6,981  4,449 
Other 8,507  8,236  23,687  23,425 
Total noninterest expenses 82,924  77,718  240,821  228,043 
Net income before income taxes 62,345  56,772  176,815  158,344 
Income tax expense 13,983  13,090  40,106  37,370 
Net income $48,362  $43,682  $136,709  $120,974 
         
Net income available to common shareholders $48,011  $43,381  $135,727  $120,124 
         
Net income per common share:        
Basic $0.60  $0.54  $1.70  $1.51 
Diluted 0.60  0.54  1.70  1.51 
Weighted average common shares outstanding:        
Basic 79,663  79,806  79,714  79,588 
Diluted 79,667  79,818  79,718  79,598 
             


Average Consolidated Balance Sheets and Net Interest Analysis
For the Three Months Ended September 30,
     
  2019 2018
(dollars in thousands, fully taxable equivalent (FTE)) Average Balance Interest Average Rate Average Balance Interest Average Rate
Assets:            
Interest-earning assets:            
Loans, net of unearned income (FTE) (1)(2) $8,835,585  $122,526  5.50% $8,199,856  $108,197  5.23%
Taxable securities (3) 2,379,927  16,626  2.79  2,763,461  18,847  2.73 
Tax-exempt securities (FTE) (1)(3) 170,027  1,502  3.53  152,939  1,417  3.71 
Federal funds sold and other interest-earning assets 182,935  616  1.35  203,707  751  1.47 
Total interest-earning assets (FTE) 11,568,474  141,270  4.85  11,319,963  129,212  4.53 
             
Noninterest-earning assets:            
Allowance for loan losses (63,474)     (62,322)    
Cash and due from banks 116,922      123,290     
Premises and equipment 221,930      216,775     
Other assets (3) 836,951      703,915     
Total assets $12,680,803      $12,301,621     
             
Liabilities and Shareholders' Equity:            
Interest-bearing liabilities:            
Interest-bearing deposits:            
NOW and interest-bearing demand $2,123,910  3,214  0.60  $1,963,312  1,985  0.40 
Money market 2,277,162  5,126  0.89  2,078,116  3,177  0.61 
Savings 695,297  41  0.02  680,640  33  0.02 
Time 1,879,801  8,053  1.70  1,545,020  3,351  0.86 
Brokered time deposits 102,078  679  2.64  434,182  2,395  2.19 
Total interest-bearing deposits 7,078,248  17,113  0.96  6,701,270  10,941  0.65 
Federal funds purchased and other borrowings 73,733  429  2.31  50,767  274  2.14 
Federal Home Loan Bank advances 88,261  521  2.34  331,413  1,791  2.14 
Long-term debt 243,935  3,214  5.23  296,366  3,605  4.83 
Total borrowed funds 405,929  4,164  4.07  678,546  5,670  3.32 
Total interest-bearing liabilities 7,484,177  21,277  1.13  7,379,816  16,611  0.89 
             
Noninterest-bearing liabilities:            
Noninterest-bearing deposits 3,453,174      3,249,218     
Other liabilities 155,107      278,764     
Total liabilities 11,092,458      10,907,798     
Shareholders' equity 1,588,345      1,393,823     
Total liabilities and shareholders' equity $12,680,803      $12,301,621     
             
Net interest revenue (FTE)   $119,993      $112,601   
Net interest-rate spread (FTE)     3.72%     3.64%
Net interest margin (FTE) (4)     4.12%     3.95%
               

(1) Interest revenue on tax-exempt securities and loans has been increased to reflect comparable interest on taxable securities and loans. The rate used was 26%, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate.
(2) Included in the average balance of loans outstanding are loans on which the accrual of interest has been discontinued and loans that are held for sale.
(3) Securities available for sale are shown at amortized cost. Pretax unrealized gains of $35.1 million in 2019 and unrealized losses of $49.9 million in 2018 are included in other assets for purposes of this presentation.
(4) Net interest margin is taxable equivalent net interest revenue divided by average interest-earning assets.

Average Consolidated Balance Sheets and Net Interest Analysis
For the Nine Months Ended September 30,
     
  2019 2018
(dollars in thousands, fully taxable equivalent (FTE)) Average Balance Interest Average Rate Average Balance Interest Average Rate
Assets:            
Interest-earning assets:            
Loans, net of unearned income (FTE) (1)(2) $8,646,622  $357,541  5.53% $8,124,269  $307,981  5.07%
Taxable securities (3) 2,532,070  54,229  2.86  2,712,900  53,399  2.62 
Tax-exempt securities (FTE) (1)(3) 168,787  4,579  3.62  150,014  4,106  3.65 
Federal funds sold and other interest-earning assets 186,402  1,913  1.37  209,836  2,123  1.35 
Total interest-earning assets (FTE) 11,533,881  418,262  4.85  11,197,019  367,609  4.39 
             
Non-interest-earning assets:            
Allowance for loan losses (62,664)     (61,259)    
Cash and due from banks 121,889      138,809     
Premises and equipment 220,872      217,339     
Other assets (3) 785,862      717,555     
Total assets $12,599,840      $12,209,463     
             
Liabilities and Shareholders' Equity:            
Interest-bearing liabilities:            
Interest-bearing deposits:            
NOW and interest-bearing demand $2,199,607  10,283  0.63  $2,098,734  4,483  0.29 
Money market 2,187,822  14,100  0.86  2,113,972  7,853  0.50 
Savings 685,167  115  0.02  671,883  117  0.02 
Time 1,761,374  20,338  1.54  1,534,823  8,288  0.72 
Brokered time deposits 292,835  5,349  2.44  298,653  4,612  2.06 
Total interest-bearing deposits 7,126,805  50,185  0.94  6,718,065  25,353  0.50 
Federal funds purchased and other borrowings 44,898  838  2.50  58,144  772  1.78 
Federal Home Loan Bank advances 142,876  2,695  2.52  392,227  5,551  1.89 
Long-term debt 252,686  9,813  5.19  295,966  10,679  4.82 
Total borrowed funds 440,460  13,346  4.05  746,337  17,002  3.05 
Total interest-bearing liabilities 7,567,265  63,531  1.12  7,464,402  42,355  0.76 
             
Noninterest-bearing liabilities:            
Noninterest-bearing deposits 3,335,450      3,178,387     
Other liabilities 164,350      199,848     
Total liabilities 11,067,065      10,842,637     
Shareholders' equity 1,532,775      1,366,826     
Total liabilities and shareholders' equity $12,599,840      $12,209,463     
             
Net interest revenue (FTE)   $354,731      $325,254   
Net interest-rate spread (FTE)     3.73%     3.63%
Net interest margin (FTE) (4)     4.11%     3.88%
               

(1) Interest revenue on tax-exempt securities and loans has been increased to reflect comparable interest on taxable securities and loans. The rate used was 26%, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate.
(2) Included in the average balance of loans outstanding are loans on which the accrual of interest has been discontinued and loans that are held for sale.
(3) Securities available for sale are shown at amortized cost. Pretax unrealized gains of $4.94 million in 2019 and unrealized losses of $40.4 million in 2018 are included in other assets for purposes of this presentation.
(4) Net interest margin is taxable equivalent net-interest revenue divided by average interest-earning assets.

About United Community Banks, Inc.
United Community Banks, Inc. (NASDAQ: UCBI) is a bank holding company headquartered in Blairsville, Georgia, with executive offices in Greenville, South Carolina. United is one of the southeast region’s largest full-service financial institutions with $12.8 billion in assets, and 147 offices in Georgia, North Carolina, South Carolina and Tennessee. It operates principally through United Community Bank, its bank subsidiary, which specializes in personalized community banking services for individuals, small businesses and companies. Services include a full range of consumer and commercial banking products, including mortgage, advisory, and treasury management. Respected national research firms consistently recognize United Community Bank for outstanding customer service. For five of the past six years, J.D. Power has ranked United Community Bank first in customer satisfaction in the Southeast. In 2019, for the sixth consecutive year, Forbes magazine included United on its list of the 100 Best Banks in America, and for the first time included United on its list of The World’s Best Banks. Additional information about UCBI and the Bank can be found at www.ucbi.com.

Non-GAAP Financial Measures
This press release, including the accompanying financial statement tables, contains financial information determined by methods other than in accordance with generally accepted accounting principles, or GAAP. This financial information includes certain operating performance measures, which exclude merger-related and other charges that are not considered part of recurring operations, such as “operating net income,” “operating net income per diluted common share,” “operating earnings per share,” “tangible book value per common share,” “operating return on common equity,” “operating return on tangible common equity,” “operating return on assets,” “operating efficiency ratio,” and “tangible common equity to tangible assets.” These non-GAAP measures are included because United believes they may provide useful supplemental information for evaluating United’s underlying performance trends. These measures should be viewed in addition to, and not as an alternative to or substitute for, measures determined in accordance with GAAP, and are not necessarily comparable to non-GAAP measures that may be presented by other companies. To the extent applicable, reconciliations of these non-GAAP measures to the most directly comparable measures as reported in accordance with GAAP are included with the accompanying financial statement tables.

For more information:
Jefferson Harralson
Chief Financial Officer
(864) 240-6208
Jefferson_Harralson@ucbi.com

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Source: United Community Banks, Inc.