SNV Synovus Financial Corporation

Diluted Earnings per Share of $0.54, up 25.9% vs. 4Q15

Quarterly Shareholder Dividend Increase of 25% to $0.15 per Share

Synovus Financial Corp. (NYSE: SNV) today reported financial results for the quarter and year ended December 31, 2016.

Net income available to common shareholders for the fourth quarter 2016 was $66.0 million or $0.54 per diluted share as compared to $62.7 million or $0.51 per diluted share for the third quarter 2016 and $55.8 million or $0.43 per diluted share for the fourth quarter 2015. Adjusted earnings per diluted share for the fourth quarter 2016 were $0.54, a 3.6% increase from the third quarter 2016 and a 22.2% increase from the fourth quarter 2015.

2016 Highlights

• Net income available to common shareholders for 2016 was $236.5 million or $1.89 per diluted share as compared to $215.8 million or $1.62 per diluted share for 2015. Diluted EPS grew 16.7% for 2016 compared to 2015.
• Total average loans1 for the year were $23.10 billion, a $1.56 billion or 7.2% increase from 2015.
  • Total loans1 ended the year at $23.86 billion, a $1.43 billion or 6.4% increase from 2015.
• Total average deposits for the year were $23.88 billion, a $1.33 billion or 5.9% increase from 2015.
• Total revenues2 of $1.16 billion increased $73.9 million or 6.8% from 2015.
• Efficiency ratio of 64.74% improved 87 basis points from 2015.
  • Adjusted efficiency ratio of 61.06% improved 87 basis points from 2015.
• Non-performing loans of $153.4 million at December 31, 2016 declined 8.9% from December 31, 2015, and the non-performing loan ratio declined 11 basis points from December 31, 2015 to 0.64% at December 31, 2016.
• Returned over $322 million in capital to common shareholders during the year through common share repurchases and dividends.
  • Common Equity Tier 1 ratio was 9.96% at December 31, 2016 compared to 10.37% at December 31, 2015.
• Completed the acquisition of Global One effective October 1, 2016.

“We closed out 2016 with another quarter of improved profitability demonstrated by diluted earnings per share of $0.54, up 26 percent compared to the fourth quarter of 2015,” said Kessel D. Stelling, Synovus Chairman and CEO. “We also achieved strong earnings per share growth for the full year and returned more than $300 million in capital to our shareholders. We are energized about the opportunities in 2017 and beyond as we focus on exceptional and efficient service delivery, understanding and meeting customer needs, further balance sheet diversification, disciplined expense management, and investing in our communities.”

Consolidated Fourth Quarter Financial Results

Balance Sheet

• Total loans1 ended the quarter at $23.86 billion, up $593.5 million or 10.1% annualized from the previous quarter and up $1.43 billion or 6.4% as compared to the fourth quarter 2015.
  • Commercial and industrial loans1 grew by $536.0 million or 19.4% annualized from the previous quarter and $779.8 million or 7.2% as compared to the fourth quarter 2015.
  • Retail loans grew by $157.0 million or 13.0% annualized from the previous quarter and $671.7 million or 15.6% as compared to the fourth quarter 2015.
  • Commercial real estate loans declined by $99.6 million or 5.3% annualized from the previous quarter and $28.8 million or 0.4% as compared to the fourth quarter 2015.
• Total average deposits for the quarter were $24.66 billion, up $631.0 million or 10.4% annualized from the previous quarter and $1.42 billion or 6.1% as compared to the fourth quarter 2015.
  • Average core transaction accounts3 grew by $414.1 million or 9.5% annualized from the previous quarter and $1.21 billion or 7.3% as compared to the fourth quarter 2015.

Core Performance

• Total revenues2 were $301.7 million, up $7.5 million or 2.6% from the previous quarter and 8.2% from the fourth quarter 2015.
• Net interest income was $233.5 million, up $7.5 million or 3.3% from the previous quarter and 9.8% as compared to the fourth quarter 2015.
• Net interest margin was 3.29%, up 2 basis points from the previous quarter. Yield on earning assets was 3.73%, up 2 basis points from the previous quarter, and the effective cost of funds was 0.44%, unchanged from the previous quarter.
• Total non-interest income was $74.0 million, up $5.9 million or 8.6% compared to the previous quarter and 11.8% as compared to the fourth quarter 2015.
• Adjusted non-interest income was $68.1 million, unchanged from the previous quarter and up 3.0% as compared to the fourth quarter 2015.
  • Core banking fees4 were $35.5 million, up $689 thousand or 2.0% from the previous quarter and 1.4% as compared to the fourth quarter 2015.
    • Gains from sale of GGL/SBA loans were $2.2 million, up $878 thousand or 67.7% from the previous quarter and 57.0% as compared to the fourth quarter 2015.
  • Fiduciary and asset management fees, brokerage revenue, and insurance revenues were $20.3 million, up $787 thousand or 4.0% from the previous quarter and 7.9% as compared to the fourth quarter 2015.
  • Mortgage banking income was $5.5 million, down $1.8 million or 24.9% from the previous quarter and up 33.1% as compared to the fourth quarter 2015.
• Total non-interest expense was $193.2 million, up $7.3 million or 3.9% from the previous quarter and 5.6% as compared to the fourth quarter 2015.
  • Fourth quarter 2016 total non-interest expense includes a $4.7 million charge related to changes in the valuation of the Visa derivative and $1.1 million in merger-related expenses.
• Adjusted non-interest expense was $187.0 million, up $3.1 million or 1.7% from the previous quarter and 3.7% as compared to the fourth quarter 2015.
  • Employment expense of $101.7 million decreased $282 thousand or 0.3% from the previous quarter and increased 6.4% as compared to the fourth quarter 2015.
  • Occupancy and equipment expense of $27.9 million decreased $253 thousand or 0.9% from the previous quarter and increased 0.2% as compared to the fourth quarter 2015.
  • Other operating expenses of $23.9 million increased $2.8 million or 13.4% from the previous quarter and 5.1% as compared to the fourth quarter 2015.
  • Efficiency ratio for the fourth quarter was 63.98% as compared to 63.13% in the previous quarter and 65.59% in the fourth quarter 2015.
  • Adjusted efficiency ratio for the fourth quarter was 60.32% as compared to 60.55% in the previous quarter and 62.13% in the fourth quarter 2015.

Credit Quality

• Non-performing loans were $153.4 million at December 31, 2016, up $5.2 million or 3.5% from the previous quarter and down $15.0 million or 8.9% from December 31, 2015. The non-performing loan ratio was 0.64% at December 31, 2016, as compared to 0.64% at the end of the previous quarter and 0.75% at December 31, 2015.
• Total non-performing assets were $175.7 million at December 31, 2016, down $3.4 million or 1.9% from the previous quarter and down $39.7 million or 18.4% from December 31, 2015. The non-performing asset ratio was 0.74% at December 31, 2016, as compared to 0.77% at the end of the previous quarter and 0.96% at December 31, 2015.
• Net charge-offs were $8.3 million in the fourth quarter 2016, up $1.4 million or 20.0% from $6.9 million in the previous quarter. The annualized net charge-off ratio was 0.14% in the fourth quarter as compared to 0.12% in the previous quarter.
• Total delinquencies (consisting of loans 30 or more days past due and still accruing) remain low at 0.27% of total loans at December 31, 2016 as compared to 0.27% the previous quarter and 0.21% at December 31, 2015.

Capital Ratios

• Common Equity Tier 1 ratio was 9.96% at December 31, 2016 compared to 9.96% at September 30, 2016.
• Tier 1 Capital ratio was 10.08% at December 31, 2016 compared to 10.05% at September 30, 2016.
• Total Risk Based Capital ratio was 12.01% at December 31, 2016 compared to 12.04% at September 30, 2016.
• Tier 1 Leverage ratio was 8.99% at December 31, 2016 compared to 8.98% at September 30, 2016.
• Tangible Common Equity ratio was 9.09% at December 31, 2016 compared to 9.28% at September 30, 2016.

Capital Management

• During the fourth quarter, the Company completed the $300 million common stock repurchase program announced in the fourth quarter 2015, which resulted in 9.9 million total shares repurchased and reduced total share count by 7.6%.
• Additionally, during the fourth quarter, the Board of Directors authorized a new share repurchase program of up to $200 million of the Company’s common stock to be executed during 2017.
• The Board of Directors also approved a 25% increase in the Company’s quarterly common stock dividend from $0.12 to $0.15 per share, effective with the quarterly dividend payable in April 2017.

Fourth Quarter Earnings Conference Call

Synovus will host an earnings highlights conference call at 8:30 a.m. EDT on January 17, 2017. The earnings call will be accompanied by a slide presentation. Shareholders and other interested parties may listen to this conference call via simultaneous Internet broadcast. For a link to the webcast, go to investor.synovus.com/event. The replay will be archived for 12 months and will be available 30-45 minutes after the call.

Synovus Financial Corp.

Synovus Financial Corp. is a financial services company based in Columbus, Georgia, with approximately $30 billion in assets. Synovus provides commercial and retail banking, investment, and mortgage services to customers through 28 locally-branded divisions, 248 branches, and 328 ATMs in Georgia, Alabama, South Carolina, Florida, and Tennessee. Synovus Bank, a wholly owned subsidiary of Synovus, was recognized as one of America's Most Reputable Banks by American Banker and the Reputation Institute in 2016 and 2015, and was named “Best Regional Bank, Southeast” by MONEY Magazine for 2016-2017. Synovus is on the web at synovus.com, on Twitter @synovus, and on LinkedIn at http://linkedin.com/company/synovus.

1 Include Global One acquisition effective October 1, 2016, which added $357 million in loans.

2 Consist of net interest income and non-interest income excluding net investment securities gains.

3 Consist of non-interest bearing, NOW/Savings, and money market deposits excluding SCMs.

4 Include service charges on deposit accounts, bankcard fees, letter of credit fees, ATM fee income, line of credit non-usage fees, gains from sales of government guaranteed loans, and miscellaneous other service charges.

Forward-Looking Statements

This press release and certain of our other filings with the Securities and Exchange Commission contain statements that constitute “forward-looking statements” within the meaning of, and subject to the protections of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are forward-looking statements. You can identify these forward-looking statements through Synovus’ use of words such as “believes,” “anticipates,” “expects,” “may,” “will,” “assumes,” “should,” “predicts,” “could,” “would,” “intends,” “targets,” “estimates,” “projects,” “plans,” “potential” and other similar words and expressions of the future or otherwise regarding the outlook for Synovus’ future business and financial performance and/or the performance of the banking industry and economy in general. These forward-looking statements include, among others, our expectations regarding deposits, loan growth and the net interest margin; expectations on our growth strategy, expense initiatives, capital management and future profitability; expectations on credit trends and key credit metrics; and the assumptions underlying our expectations. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve known and unknown risks and uncertainties which may cause the actual results, performance or achievements of Synovus to be materially different from the future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements are based on the information known to, and current beliefs and expectations of, Synovus’ management and are subject to significant risks and uncertainties. Actual results may differ materially from those contemplated by such forward-looking statements. A number of factors could cause actual results to differ materially from those contemplated by the forward-looking statements in this press release. Many of these factors are beyond Synovus’ ability to control or predict.

These forward-looking statements are based upon information presently known to Synovus’ management and are inherently subjective, uncertain and subject to change due to any number of risks and uncertainties, including, without limitation, the risks and other factors set forth in Synovus’ filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2015 under the captions “Cautionary Notice Regarding Forward-Looking Statements” and “Risk Factors” and in Synovus’ quarterly reports on Form 10-Q and current reports on Form 8-K. We believe these forward-looking statements are reasonable; however, undue reliance should not be placed on any forward-looking statements, which are based on current expectations and speak only as of the date that they are made. We do not assume any obligation to update any forward-looking statements as a result of new information, future developments or otherwise, except as otherwise may be required by law.

Use of Non-GAAP Financial Measures

The measures entitled adjusted diluted earnings per share; average core transaction deposit accounts; adjusted non-interest income; adjusted non-interest expense; adjusted efficiency ratio; tangible common equity ratio; and common equity Tier 1 (CET1) ratio (fully phased-in) are not measures recognized under U.S. generally accepted accounting principles (GAAP) and therefore are considered non-GAAP financial measures. The most comparable GAAP measures are diluted earnings per share; total average deposits; total non-interest income; total non-interest expense; efficiency ratio and total shareholders’ equity to total assets ratio, respectively.

Synovus believes that these non-GAAP financial measures provide meaningful additional information about Synovus to assist management, investors, and bank regulators in evaluating Synovus’ capital strength and the performance of its core business. Adjusted diluted earnings per share is a measure used by management to evaluate operating results exclusive of items that are not indicative of ongoing operations and impact period-to- period comparisons. Average core transaction deposit accounts are a measure used by management to evaluate organic growth of deposits and the quality of deposits as a funding source. Adjusted non-interest income is a measure utilized by management to measure non-interest income exclusive of net investment securities gains. Adjusted non-interest expense and the adjusted efficiency ratio are measures utilized by management to measure the success of expense management initiatives focused on reducing recurring controllable operating costs. The tangible common equity ratio and common equity Tier 1 (CET1) ratio (fully phased-in) are used by management and bank regulators to assess the strength of our capital position. These non-GAAP financial measures should not be considered as substitutes for diluted earnings per share; total average deposits; total non-interest income; total non-interest expense; efficiency ratio; and total shareholders’ equity to total assets ratio determined in accordance with GAAP and may not be comparable to other similarly titled measures at other companies.

The computations of adjusted diluted earnings per share; average core transaction deposit accounts; adjusted non-interest income; adjusted non-interest expense; adjusted efficiency ratio; tangible common equity ratio; and common equity Tier 1 (CET1) ratio (fully phased-in) and the reconciliation of these measures to diluted earnings per share; total average deposits; total non-interest income; total non-interest expense; efficiency ratio; and total shareholders’ equity to total assets ratio are set forth in the tables below.

  Reconciliation of Non-GAAP Financial Measures (dollars in thousands)       4Q16     3Q16     4Q15           Adjusted Diluted Earnings per Share Net income available to common shareholders $ 65,990 62,686 55,839 Add: Litigation contingency/settlement (recovery) expense* - (189 ) 710 Add: Restructuring charges 42 1,243 69 Add: Merger-related expenses 1,086 550 - Add: Fair value adjustment to Visa derivative 4,716 360 371 Add: Loss on early extinguishment of debt - - 1,533 Subtract: Investment securities gains, net (5,885 ) (59 ) (58 ) Tax effect of adjustments   15   (697 ) (961 ) Adjusted net income available to common shareholders $ 65,964   63,894   57,503   Weighted average common shares outstanding, diluted 123,187 123,604 131,197 Adjusted diluted earnings per share $ 0.54   0.52   0.44     Average Core Transaction Deposit Accounts Total average deposits $ 24,661,265 24,030,330 23,244,256 Subtract: Average brokered deposits (1,380,931 ) (1,409,740 ) (1,185,093 ) Subtract: Average time deposits excluding average SCM time deposits (3,147,620 ) (3,153,366 ) (3,188,706 ) Subtract: Average state, county, and municipal (SCM) deposits   (2,356,567 ) (2,105,126 ) (2,303,278 ) Average core transaction deposit accounts $ 17,776,147   17,362,098   16,567,179     Adjusted Non-interest Income Total non-interest income $ 74,006 68,155 66,175 Subtract: Investment securities gains, net   (5,885 ) (59 ) (58 ) Adjusted non-interest income $

68,121

 

68,096   66,117  

 

 

  Reconciliation of Non-GAAP Financial Measures, continued (dollars in thousands)

4Q16

3Q16

4Q15

2016

2015

  Adjusted Non-interest Expense Total non-interest expense $ 193,209 185,871 183,033 755,925 717,655 Subtract: Restructuring charges (42 ) (1,243 ) (69 ) (8,267 ) (36 ) Subtract: Fair value adjustment to Visa derivative (4,716 ) (360 ) (371 ) (5,795 ) (1,463 )

Subtract: Litigation contingency/settlement recovery (expense)*

- 189 (710 ) (2,511 ) (5,110 ) Subtract: Loss on early extinguishment of debt - - - (4,735 ) (1,533 ) Subtract: Merger-related expenses (1,086 ) (550 ) (1,533 ) (1,636 ) - Subtract: Amortization of intangibles   (400 ) -   (123 ) (521 ) (503 )   Adjusted non-interest expense $ 186,965   183,907   180,227   732,460   709,010     Adjusted Efficiency Ratio Adjusted non-interest expense $ 186,965 183,907 180,227 732,460

709,010

Subtract: Foreclosed real estate expense (2,840 ) (2,725 ) (4,454 ) (12,838 ) (22,804

)

Subtract: Other credit costs   (1,969 ) (2,913 ) (2,410 ) (6,701 ) (8,853 ) Adjusted non-interest expense excluding total credit costs $ 182,156   178,269   173,363   712,921   677,353   Net interest income 233,530 226,007 212,620 899,180 827,318 Add: Tax equivalent adjustment 322 330 311 1,286 1,304 Add: Total non-interest income 74,006 68,155 66,175 273,194 267,920 Subtract: Investment securities gains, net   (5,885 ) (59 ) (58 ) (6,011 ) (2,769 ) Total revenues $ 301,973   294,433   279,048   1,167,649   1,093,773   Adjusted efficiency ratio   60.32 % 60.55   62.13   61.06   61.93        

 

Reconciliation of Non-GAAP Financial Measures, continued (dollars in thousands) 4Q16 3Q16 4Q15   Tangible common equity ratio Total assets $ 30,104,002 29,727,096 28,792,653 Subtract: Goodwill (59,678 ) (24,431 ) (24,431 ) Subtract: Other intangible assets, net   (13,223 ) (225 ) (471 ) Tangible assets $ 30,031,101   29,702,440   28,767,751     Total shareholders’ equity $ 2,927,924 2,906,659 3,000,196 Subtract: Goodwill (59,678 ) (24,431 ) (24,431 ) Subtract: Other intangible assets, net (13,223 ) (225 ) (471 ) Subtract: Series C Preferred Stock, no par value   (125,980 ) (125,980 ) (125,980 ) Tangible common equity $ 2,729,043   2,756,023   2,849,314   Total shareholders’ equity to total assets ratio 9.73 % 9.78 10.42 Tangible common equity ratio 9.09 % 9.28 9.90   Common Equity Tier 1 (CET1) ratio (fully phased-in) Common Equity Tier 1 (CET1) $ 2,654,286 2,596,233 2,660,016 Adjustment related to capital components   (94,386 ) (101,843 ) (128,480 ) CET1 (fully phased-in) $ 2,559,900   2,494,390   2,531,536   Total risk-weighted assets (fully phased-in) $ 26,900,331 26,323,936 25,915,650 Common Equity Tier 1 (CET1) ratio (fully phased-in) 9.52 % 9.48 9.77  

* Amounts for other periods presented herein are not reported separately as amounts are not material.

    Synovus   INCOME STATEMENT DATA       Twelve Months Ended (Unaudited) (Dollars in thousands, except per share data) December 31,         2016       2015     Change     Interest income $ 1,022,803 945,962 8.1 % Interest expense 123,623 118,644 4.2     Net interest income 899,180 827,318 8.7 Provision for loan losses 28,000 19,010 47.3     Net interest income after provision for loan losses 871,180 808,308 7.8     Non-interest income: Service charges on deposit accounts 81,425 80,142 1.6 Fiduciary and asset management fees 46,594 45,928 1.5 Brokerage revenue 27,028 27,855 (3.0 ) Mortgage banking income 24,259 24,096 0.7 Bankcard fees 33,318 33,172 0.4 Investment securities gains, net 6,011 2,769 117.1 Other fee income 20,220 21,170 (4.5 ) Other non-interest income 34,339 32,788 4.7     Total non-interest income 273,194 267,920 2.0       Non-interest expense: Salaries and other personnel expense 402,026 380,918 5.5 Net occupancy and equipment expense 109,347 107,466 1.8 Third-party processing expense 46,320 42,851 8.1 FDIC insurance and other regulatory fees 26,714 27,091 (1.4 ) Professional fees 26,698 26,646 0.2 Advertising expense 20,264 15,477 30.9 Foreclosed real estate expense, net 12,838 22,803 (43.7 ) Merger-related expense 1,636 - nm Amortization of intangibles 521 503 3.6 Fair value adjustment to Visa derivative 5,795 1,464 295.8 Loss on early extinguishment of debt 4,735 1,533 208.9 Litigation settlement/contingency expense 2,511 5,110 (50.9 ) Restructuring charges, net 8,267 36 nm Other operating expenses 88,251 85,757 2.9     Total non-interest expense 755,923 717,655 5.3       Income before income taxes 388,451 358,573 8.3 Income tax expense 141,667 132,491 6.9     Net income 246,784 226,082 9.2   Dividends on preferred stock 10,238 10,238 -       Net income available to common shareholders $ 236,546 215,844 9.6   %     Net income per common share, basic $ 1.90 1.63 16.7 %   Net income per common share, diluted 1.89 1.62 16.7   Cash dividends declared per common share 0.48 0.42 14.3   Return on average assets 0.84 % 0.80 4 bp Return on average common equity 8.41 7.46 95     Weighted average common shares outstanding, basic 124,389 132,423 (6.1 ) % Weighted average common shares outstanding, diluted 125,078 133,201 (6.1 )   nm - not meaningful bps - basis points     Synovus   INCOME STATEMENT DATA (Unaudited) (In thousands, except per share data)       2016     2015     4th Quarter   Fourth     Third     Second     First     Fourth     '16 vs. '15 Quarter       Quarter     Quarter     Quarter     Quarter     Change     Interest income $ 264,534 256,554 252,393 249,323 242,814 8.9 % Interest expense 31,004 30,547   30,944 31,130 30,194 2.7       Net interest income 233,530 226,007 221,449 218,193 212,620 9.8 Provision for loan losses 6,259 5,671   6,693 9,377 5,021 24.7       Net interest income after provision for loan losses 227,271 220,336   214,756 208,816 207,599 9.5       Non-interest income: Service charges on deposit accounts 20,653 20,822 20,240 19,710 20,522 0.6 Fiduciary and asset management fees 11,903 11,837 11,580 11,274 11,206 6.2 Brokerage revenue 7,009 6,199 7,338 6,483 6,877 1.9 Mortgage banking income 5,504 7,329 5,941 5,484 4,136 33.1 Bankcard fees 8,330 8,269 8,346 8,372 8,262 0.8 Investment securities gains, net 5,885 59 - 67 58 nm Other fee income 4,965 5,171 5,280 4,804 5,798 (14.4 ) Other non-interest income 9,757 8,469   9,161 6,953 9,316 4.7       Total non-interest income 74,006 68,155   67,886 63,147 66,175 11.8         Non-interest expense: Salaries and other personnel expense 101,662 101,945 97,061 101,358 95,524 6.4 Net occupancy and equipment expense 27,867 28,120 26,783 26,577 27,816 0.2 Third-party processing expense 12,287 11,219 11,698 11,116 10,993 11.8 FDIC insurance and other regulatory fees 6,614 6,756 6,625 6,719 6,776 (2.4 ) Professional fees 6,904 6,486 6,938 6,369 8,265 (16.5 ) Advertising expense 4,905 5,597 7,351 2,410 3,680 33.3 Foreclosed real estate expense, net 2,840 2,725 4,588 2,684 4,454 (36.2 ) Merger-related expense 1,086 550 - - - nm Amortization of intangibles 400 - - 121 123 nm Fair value adjustment to Visa derivative 4,716 360 360 360 371 nm Loss on early extinguishment of debt - - - 4,735 1,533 - Litigation contingency/settlement (recovery) expense - (189 ) - 2,700 710 (100.0 ) Restructuring charges, net 42 1,243 5,841 1,140 69 (39.1 ) Other operating expenses 23,886 21,059   21,366 21,944 22,720 5.1     Total non-interest expense 193,209 185,871   188,611 188,233 183,034 5.6         Income before income taxes 108,068 102,620 94,031 83,730 90,741 19.1 Income tax expense 39,519 37,375   33,574 31,199 32,343 22.2       Net income 68,549 65,245 60,457 52,531 58,398 17.4   Dividends on preferred stock 2,559 2,559   2,559 2,559 2,559 -     Net income available to common shareholders $ 65,990 62,686   57,898 49,972 55,839 18.2   %   Net income per common share, basic $ 0.54 0.51 0.46 0.39 0.43 25.9 %   Net income per common share, diluted 0.54 0.51 0.46 0.39 0.43 25.9   Cash dividends declared per common share 0.12 0.12 0.12 0.12 0.12 0.0   Return on average assets * 0.90 % 0.88 0.83 0.73 0.81 9 bps Return on average common equity * 9.42 8.89 8.26 7.06 7.67 175   Weighted average common shares outstanding, basic 122,341 122,924 125,100 127,227 130,354 (6.1 ) % Weighted average common shares outstanding, diluted 123,187 123,604 125,699 127,857 131,197 (6.1 )   nm - not meaningful bps - basis points * - ratios are annualized                 Synovus       BALANCE SHEET DATA December 31, 2016 September 30, 2016 December 31, 2015 (Unaudited)   (In thousands, except share data)   ASSETS

Cash and cash equivalents

$ 395,175 367,342 367,092 Interest bearing funds with Federal Reserve Bank 527,090 985,776 829,887 Interest earning deposits with banks 18,720 18,375 17,387

Federal funds sold and securities purchased under resale agreements

58,060

71,753 69,819 Trading account assets, at fair value 9,314 7,309 5,097 Mortgage loans held for sale, at fair value 51,545 95,769 59,275 Investment securities available for sale, at fair value 3,718,195 3,603,153 3,587,818   Loans, net of deferred fees and costs 23,856,391 23,262,887 22,429,565 Allowance for loan losses (251,758 ) (253,817 ) (252,496 ) Loans, net 23,604,633   23,009,070   22,177,069     Premises and equipment, net 417,485 418,091 445,155 Goodwill 59,678 24,431 24,431 Intangible assets, net 13,223 225 471 Other real estate 22,308 28,438 47,030 Deferred tax asset, net 395,356 395,795 511,948 Other assets 813,220   701,569   650,174     Total assets $ 30,104,002   29,727,096   28,792,653       LIABILITIES AND SHAREHOLDERS' EQUITY Liabilities: Deposits: Non-interest bearing deposits $ 7,085,804 7,059,059 6,732,970 Interest bearing deposits, excluding brokered deposits 16,183,273 15,817,596 15,434,171 Brokered deposits 1,378,983   1,315,348   1,075,520     Total deposits 24,648,060 24,192,003 23,242,661   Federal funds purchased and securities sold under repurchase agreements 159,699 195,025 177,025 Long-term debt 2,160,881 2,160,985 2,186,893 Other liabilities 207,438   272,424   185,878     Total liabilities 27,176,078   26,820,437   25,792,457         Shareholders' equity: Series C Preferred Stock - no par value, 5,200,000 shares outstanding at December 31, 2016, September 30, 2016, and December 31, 2015 125,980 125,980 125,980 Common stock - $1.00 par value. 122,266,106 shares outstanding at December 31, 2016, 121,453,772 shares outstanding at September 30, 2016, and 129,547,032 shares outstanding at December 31, 2015 142,026 141,066 140,592 Additional paid-in capital 3,028,405 2,987,760 2,989,981 Treasury stock, at cost - 19,759,614 shares at December 31, 2016, 19,612,435 shares at September 30, 2016, and 11,045,377 shares at December 31, 2015 (664,595 ) (654,014 ) (401,511 ) Accumulated other comprehensive (loss) gain (55,659 ) 5,165 (29,819 ) Retained earnings 351,767   300,702   174,973   Total shareholders' equity 2,927,924   2,906,659   3,000,196     Total liabilities and shareholders' equity $ 30,104,002   29,727,096   28,792,653       Synovus   AVERAGE BALANCES AND YIELDS/RATES (1) (Unaudited) (Dollars in thousands)       2016     2015 Fourth     Third     Second     First     Fourth Quarter       Quarter     Quarter     Quarter     Quarter Interest Earning Assets Taxable investment securities (2) $ 3,643,510 3,544,933 3,529,030 3,537,131 3,481,184 Yield 1.92 % 1.83 1.89 1.91 1.85   Tax-exempt investment securities (2) (4) $ 2,824 2,943 3,491 4,091 4,352 Yield (taxable equivalent) 5.82 % 5.96 6.08 6.37 6.16   Trading account assets $ 6,799 5,493 3,803 5,216 8,067 Yield 2.63 % 0.93 1.27 1.65 2.24   Commercial loans (3) (4) $ 18,812,659 18,419,484 18,433,638 18,253,169 17,884,661 Yield 4.05 % 4.03 4.04 4.03 3.97   Consumer loans (3) $ 4,911,149 4,720,082 4,497,147 4,334,817 4,233,061 Yield 4.27 % 4.30 4.32 4.37 4.27   Allowance for loan losses $ (253,713 )       (255,675 )     (251,101 )     (258,097 )     (252,049 )   Loans, net (3) $ 23,470,095 22,883,891 22,679,684 22,329,889 21,865,673 Yield 4.14 % 4.14 4.15 4.15 4.08   Mortgage loans held for sale $ 77,652 87,524 72,477 63,339 50,668 Yield 3.51 % 3.32 3.59 3.72 3.84  

Federal funds sold, due from Federal Reserve Bank, and other short-term investments

$

982,355

998,565 907,614 885,938 1,081,604 Yield 0.49 % 0.48 0.47 0.47 0.27   Federal Home Loan Bank and Federal Reserve Bank stock (5) $ 121,079 70,570 77,571 80,679 66,790 Yield 3.75 % 4.99 5.15 3.82 5.08                                       Total interest earning assets $ 28,304,314 27,593,919 27,273,670 26,906,283 26,558,338 Yield         3.73   %     3.71       3.73       3.73       3.63     Interest Bearing Liabilities   Interest bearing demand deposits $ 4,488,135 4,274,117 4,233,310 4,198,738 4,117,116 Rate 0.16 % 0.16 0.18 0.17 0.17   Money market accounts $ 7,359,067 7,227,030 7,082,759 7,095,778 7,062,517 Rate 0.29 % 0.29 0.31 0.32 0.35   Savings deposits $ 908,725 797,961 746,225 722,172 692,536 Rate 0.12 % 0.07 0.06 0.07 0.06   Time deposits under $100,000 $ 1,229,809 1,248,294 1,262,280 1,279,811 1,307,601 Rate 0.64 % 0.64 0.64 0.65 0.65   Time deposits over $100,000 $ 2,014,564 2,030,242 2,016,116 2,006,302 2,033,193 Rate 0.90 % 0.88 0.89 0.89 0.88   Non maturing brokered deposits $ 638,779 634,596 451,398 315,006 297,925 Rate 0.31 % 0.29 0.39 0.48 0.31   Brokered time deposits $ 742,153 775,143 885,603 780,233 887,168 Rate 0.90   %     0.88       0.85       0.83       0.76     Total interest bearing deposits $ 17,381,232 16,987,383 16,677,691 16,398,040 16,398,056 Rate 0.37 % 0.37 0.39 0.39 0.40  

Federal funds purchased and securities sold under repurchase agreements

$ 219,429 247,378 221,276 177,921 158,810 Rate 0.08 % 0.09 0.09 0.10 0.08   Long-term debt $ 2,190,716 2,114,193 2,279,043 2,361,973 2,007,924 Rate 2.65 % 2.71 2.55 2.55 2.63                                       Total interest bearing liabilities $ 19,791,377 19,348,954 19,178,010 18,937,934 18,564,790 Rate         0.62   %     0.63       0.65       0.66       0.65     Non-interest bearing demand deposits $ 7,280,033 7,042,908 6,930,336 6,812,223 6,846,200   Effective cost of funds 0.44 % 0.44 0.46 0.46 0.45                                       Net interest margin         3.29   %     3.27       3.27       3.27       3.18     Taxable equivalent adjustment $ 322 330 329 305 311   (1) Yields and rates are annualized. (2) Excludes net unrealized gains and losses. (3) Average loans are shown net of unearned income. Non-performing loans are included.

(4) Reflects taxable-equivalent adjustments, using the statutory federal income tax rate of 35%, in adjusting interest on tax-exempt loans and investment securities to a taxable-equivalent basis.

(5) Included as a component of Other Assets on the consolidated balance sheet     Synovus   NON-PERFORMING LOANS COMPOSITION (Unaudited) (Dollars in thousands)                                 Total Total Total Non-performing Non-performing 4Q16 vs. 3Q16 Non-performing 4Q16 vs. 4Q15 Loan Type Loans Loans % change (1) Loans % change   December 31, 2016 September 30, 2016   December 31, 2015       Multi-Family $ 1,853 3,912 (209.4 ) % $ 223 nm Hotels 335 346 (12.6 ) 381 (12.1 ) % Office Buildings 1,380 931 191.9 1,170 17.9 Shopping Centers 354 354 0.0 907 (61.0 ) Warehouses 592 1,108 (185.3 ) 208 184.6 Other Investment Property 922   2,233   (233.6 ) 20,151   (95.4 )   Total Investment Properties 5,436 8,884 (154.4 ) 23,040 (76.4 )     1-4 Family Construction 305 304 1.3 - nm 1-4 Family Investment Mortgage 8,809 7,658 59.8 7,708 14.3 Residential Development 8,994   9,190   (8.5 ) 9,130   (1.5 )   Total 1-4 Family Properties 18,108 17,152 22.2 16,838 7.5   Land Acquisition 7,071   6,672   23.8   17,768   (60.2 )   Total Commercial Real Estate 30,615 32,708 (25.5 ) 57,646 (46.9 )             Commercial, Financial, and Agricultural 59,074 49,874 73.4 49,137 20.2 Owner-Occupied 16,503   21,443   (91.7 ) 20,294   (18.7 )   Total Commercial & Industrial 75,577   71,317   23.8   69,431   8.9     Home Equity Lines 21,551 19,815 34.9 16,480 30.8 Consumer Mortgages 22,681 21,284 26.1 22,248 1.9 Credit Cards - - - - - Other Retail Loans 2,954   3,031   (10.1 ) 2,565   15.2     Total Retail 47,186   44,130   27.5   41,293   14.3       Total $ 153,378   148,155   14.0   % $ 168,370   (8.9 ) %   (1) Percentage change is annualized.                                               LOANS OUTSTANDING BY TYPE COMPARISON (Unaudited) (Dollars in thousands) Total Loans Total Loans 4Q16 vs. 3Q16 Total Loans 4Q16 vs. 4Q15 Loan Type December 31, 2016 September 30, 2016 % change (1) December 31, 2015 % change               Multi-Family $ 1,568,234 1,553,275 3.8 % $ 1,391,453 12.7 % Hotels 748,951 774,873 (13.3 ) 703,825 6.4 Office Buildings 1,568,328 1,575,190 (1.7 ) 1,495,247 4.9 Shopping Centers 964,325 917,284 20.4 956,394 0.8 Warehouses 486,300 522,170 (27.3 ) 563,217 (13.7 ) Other Investment Property 596,481   626,674   (19.2 ) 641,495   (7.0 ) Total Investment Properties 5,932,619 5,969,466 (2.5 ) 5,751,631 3.1   1-4 Family Construction 190,477 193,791 (6.8 ) 187,545 1.6 1-4 Family Investment Mortgage 696,830 727,897 (17.0 ) 786,797 (11.4 ) Residential Development 136,514   149,366   (34.2 ) 154,814   (11.8 ) Total 1-4 Family Properties 1,023,821 1,071,054 (17.5 ) 1,129,156 (9.3 ) Land Acquisition 409,534   425,058   (14.5 ) 513,981   (20.3 ) Total Commercial Real Estate 7,365,974 7,465,578 (5.3 ) 7,394,768 (0.4 )   Commercial, Financial, and Agricultural 6,915,927 6,544,629 22.6 6,453,180 7.2 Owner-Occupied 4,636,016   4,471,365   14.6   4,318,950   7.3   Total Commercial & Industrial 11,551,943 11,015,994 19.4 10,772,130 7.2   Home Equity Lines 1,617,265 1,638,844 (5.2 ) 1,689,914 (4.3 ) Consumer Mortgages 2,296,604 2,243,154 9.5 1,938,683 18.5 Credit Cards 232,413 232,309 0.2 240,851 (3.5 ) Other Retail Loans 818,183   693,204   71.7   423,318   93.3   Total Retail 4,964,465 4,807,511 13.0 4,292,766 15.6 Unearned Income (25,991 ) (26,196 ) (3.1 ) (30,099 ) (13.6 )   Total $ 23,856,391   23,262,887   10.1   % $ 22,429,565   6.4   %     (1) Percentage change is annualized.     Synovus   CREDIT QUALITY DATA (Unaudited) (Dollars in thousands)       2016     2015     4th Quarter   Fourth     Third     Second First     Fourth '16 vs. '15 Quarter   Quarter Quarter Quarter Quarter Change     Non-performing Loans $ 153,378 148,155 154,072 178,167 168,370 (8.9 ) % Impaired Loans Held for Sale (1) - 2,473 - - - - Other Real Estate 22,308 28,438 33,289 38,462 47,030 (52.6 )   Non-performing Assets 175,686 179,066 187,361 216,629 215,400 (18.4 )   Allowance for loan losses 251,758 253,817 255,076 254,516 252,496 (0.3 )   Net Charge-Offs - Quarter 8,319 6,930 6,133 7,357 3,425 142.9 Net Charge-Offs - YTD 28,739 20,420 13,490 7,357 27,831 3.3 Net Charge-Offs / Average Loans - Quarter (2) 0.14 % 0.12 0.11 0.13 0.06 Net Charge-Offs / Average Loans - YTD (2) 0.12 0.12 0.12 0.13 0.13   Non-performing Loans / Loans 0.64 0.64 0.67 0.78 0.75 Non-performing Assets / Loans, Other Loans Held for Sale & ORE 0.74 0.77 0.81 0.95 0.96 Allowance / Loans 1.06 1.09 1.11 1.12 1.13   Allowance / Non-performing Loans 164.14 171.32 165.56 142.85 149.96 Allowance / Non-performing Loans (3) 202.01 198.94 195.25 173.64 189.47   Past Due Loans over 90 days and Still Accruing $ 3,135 5,358 5,964 3,214 2,621 19.6 As a Percentage of Loans Outstanding 0.01 % 0.02 0.03 0.01 0.01   Total Past Due Loans and Still Accruing $ 65,106 61,781 55,716 63,852 47,912 35.9 As a Percentage of Loans Outstanding 0.27 % 0.27 0.24 0.28 0.21   Accruing Troubled Debt Restructurings (TDRs) $ 195,776 201,896 205,165 209,159 223,873 (12.6 )   (1) Represent impaired loans that are intended to be sold. Held for sale loans are carried at the lower of cost or fair value, less costs to sell. (2) Ratio is annualized. (3) Excludes non-performing loans for which the expected loss has been charged off.                                                     SELECTED CAPITAL INFORMATION (1) (Unaudited) (Dollars in thousands)      

December 31,2016

 

September 30,2016

December 31,2015

    Tier 1 Capital $ 2,685,880 2,620,379 2,660,016 Total Risk-Based Capital 3,201,268 3,139,465 3,255,758 Common Equity Tier 1 Ratio (transitional) 9.96 % 9.96 10.37 Common Equity Tier 1 Ratio (fully phased-in) 9.52 9.48 9.77 Tier 1 Capital Ratio 10.08 10.05 10.37 Total Risk-Based Capital Ratio 12.01 12.04 12.70 Tier 1 Leverage Ratio 8.99 8.98 9.43 Common Equity as a Percentage of Total Assets (2) 9.31 9.35 9.98 Tangible Common Equity as a Percentage of Tangible Assets (3) 9.09 9.28 9.90 Tangible Common Equity as a Percentage of Risk Weighted Assets (3) 10.24 10.58 11.11 Book Value Per Common Share (4) 22.92 22.89 22.19 Tangible Book Value Per Common Share (3) 22.32 22.69 21.99     (1) Current quarter regulatory capital information is preliminary. (2) Common equity consists of Total Shareholders' Equity less Preferred Stock. (3) Excludes the carrying value of goodwill and other intangible assets from common equity and total assets

(4) Book Value Per Common Share consists of Total Shareholders' Equity less Preferred Stock divided by total common shares outstanding. impact of unexercised tangible equity units (tMEDs).

 

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Synovus Financial Corp.Investor ContactBob May, 706-649-3555Investor RelationsorMedia ContactLee Underwood, 706-644-0528Media Relations