Diluted Earnings per Share of $1.11 vs.
$1.19 in 1Q21
Adjusted Diluted Earnings per Share of $1.08
vs. $1.21 in 1Q21
Synovus Financial Corp. (NYSE: SNV) today reported financial
results for the quarter ended March 31, 2022. “Performance during
the first quarter reflects strong execution against our profitable
growth objectives, evidenced by 11 percent annualized loan growth
and adjusted pre-provision net revenue of $213 million, up 9%
year-over-year,” said Synovus President and CEO Kevin Blair. “In a
rapidly changing landscape that presented new challenges, our team
excelled, enabling an increase in our financial expectations for
2022. Leveraging the strength of our core franchise while leaning
into our solid, transformational growth plan, we will enhance
performance throughout the year while proactively pursuing new and
expanded sources of revenue. I remain confident in the strength and
capabilities of our team and our ability to achieve sustainable top
quartile performance.”
First Quarter 2022 Highlights
- Net income available to common shareholders of $162.7 million,
or $1.11 per diluted share, down $0.20 sequentially and down $0.08
compared to prior year.
- Adjusted diluted EPS of $1.08, down $0.27 sequentially and down
$0.13 compared to prior year. Year-over-year decline was primarily
due to increased provision for credit losses.
- Period-end loans increased $857.2 million sequentially, and
$1.05 billion, or 11.0% annualized, excluding Paycheck Protection
program (PPP) loans.
- Core transaction deposits (non-interest bearing, NOW/savings,
and money market deposits excluding public and brokered funds)
increased $405.0 million sequentially, or 4% annualized, largely
due to growth in non-interest bearing and savings deposits.
- Total deposit costs of 0.11% down 1 bp sequentially primarily
due to mix optimization.
- Pre-provision net revenue of $225.1 million increased $7.5
million, or 3%, compared to prior year.
- Adjusted pre-provision net revenue of $213.4 million increased
$17.3 million, or 9%, compared to prior year driven primarily by
growth in net interest income excluding PPP fees of over $36
million, or 10%.
First Quarter Summary
Reported
Adjusted
(dollars in thousands)
1Q22
4Q21
1Q21
1Q22
4Q21
1Q21
Net income available to common
shareholders
$
162,746
$
192,110
$
178,802
$
158,368
$
198,373
$
180,685
Diluted earnings per share
1.11
1.31
1.19
1.08
1.35
1.21
Total loans
40,169,150
39,311,958
38,805,101
N/A
N/A
N/A
Total deposits
48,656,244
49,427,276
47,368,951
N/A
N/A
N/A
Total TE(1) revenue
498,447
510,265
485,587
499,742
509,040
486,785
Return on avg assets
1.22
%
1.40
%
1.40
%
1.19
%
1.44
%
1.41
%
Return on avg common equity
14.20
16.11
15.77
13.82
16.64
15.93
Return on avg tangible common equity
16.02
18.14
17.85
15.59
18.72
18.04
Net interest margin
3.00
2.96
3.04
N/A
N/A
N/A
Efficiency ratio-TE(1)
54.66
57.85
55.01
55.50
55.64
54.12
NCO ratio-QTD
0.19
0.11
0.21
N/A
N/A
N/A
NPA ratio
0.40
0.40
0.50
N/A
N/A
N/A
(1) Taxable equivalent
Balance Sheet
Loans*
(dollars in millions)
1Q22
4Q21
Linked Quarter Change
Linked Quarter %
Change
1Q21
Year/Year Change
Year/Year % Change
Commercial & industrial
$
20,352.3
$
19,622.9
$
729.4
4
%
$
19,779.6
$
572.7
3
%
Commercial real estate
11,145.3
11,015.1
130.2
1
10,533.9
611.4
6
Consumer
8,671.5
8,673.9
(2.4
)
—
8,491.6
179.9
2
Total loans
$
40,169.2
$
39,312.0
$
857.2
2
%
$
38,805.1
$
1,364.0
4
%
*Amounts may not total due to rounding
- Total loans ended the quarter at $40.17 billion, up $857.2
million sequentially, and $1.05 billion, or 11.0% annualized,
excluding PPP loans.
- Commercial and industrial (C&I) loans increased $729.4
million sequentially, led by broad based growth within our
Wholesale Banking segment, partially offset by declines in PPP loan
balances of $196.7 million.
- CRE loans increased $130.2 million, with payoff activity down
from elevated levels seen in the second half of 2021.
- Consumer loans decreased $2.4 million sequentially.
Deposits*
(dollars in millions)
1Q22
4Q21
Linked Quarter Change
Linked Quarter %
Change
1Q21
Year/Year Change
Year/Year % Change
Non-interest-bearing DDA
$
15,526.7
$
15,242.8
$
283.8
2
%
$
13,742.1
$
1,784.6
13
%
Interest-bearing DDA
6,685.4
6,347.0
338.4
5
5,841.7
843.6
14
Money market
14,596.9
14,886.4
(289.5
)
(2
)
13,943.7
653.2
5
Savings
1,476.7
1,404.4
72.3
5
1,277.0
199.7
16
Public funds
6,048.7
6,284.6
(235.8
)
(4
)
6,154.9
(106.2
)
(2
)
Time deposits
2,284.2
2,427.1
(142.9
)
(6
)
3,214.8
(930.6
)
(29
)
Brokered deposits
2,037.7
2,835.0
(797.3
)
(28
)
3,194.7
(1,157.0
)
(36
)
Total deposits
$
48,656.2
$
49,427.3
$
(771.0
)
(2
)%
$
47,369.0
$
1,287.3
3
%
*Amounts may not total due to rounding
- Total deposits ended the quarter at $48.66 billion, down $771.0
million sequentially.
- Core transaction deposits increased $405.0 million
sequentially, or 4% annualized.
- Growth of $283.8 million in non-interest bearing deposits and
$72.3 million in savings deposits.
- Total deposit costs declined 1 bp sequentially to 0.11% due to
mix optimization.
Income Statement Summary**
(in thousands, except per share data)
1Q22
4Q21
Linked Quarter Change
Linked Quarter %
Change
1Q21
Year/Year Change
Year/Year % Change
Net interest income
$
392,248
$
392,313
$
(65
)
—
%
$
373,857
$
18,391
5
%
Non-interest revenue
105,334
117,068
(11,734
)
(10
)
110,956
(5,622
)
(5
)
Non-interest expense
272,450
295,207
(22,757
)
(8
)
267,134
5,316
2
Provision for (reversal of) credit
losses
11,400
(55,210
)
66,610
nm
(18,575
)
29,975
nm
Income before taxes
$
213,732
$
269,384
$
(55,652
)
(21
)%
$
236,254
$
(22,522
)
(10
)%
Income tax expense
42,695
68,983
(26,288
)
(38
)
49,161
(6,466
)
(13
)
Preferred stock dividends
8,291
8,291
—
—
8,291
—
—
Net income available to common
shareholders
$
162,746
$
192,110
$
(29,364
)
(15
)%
$
178,802
$
(16,056
)
(9
)%
Weighted average common shares
outstanding, diluted
146,665
146,793
(128
)
—
%
149,780
(3,115
)
(2
)%
Diluted earnings per share
$
1.11
$
1.31
$
(0.20
)
(15
)
$
1.19
$
(0.08
)
(7
)
Adjusted diluted earnings per share
1.08
1.35
(0.27
)
(20
)
1.21
(0.13
)
(11
)
** Amounts may not total due to
rounding
Core Performance
- Net interest income of $392.2 million was flat sequentially,
despite lower day count and PPP fees, and increased $18.4 million,
or 5%, compared to prior year.
- Net PPP fee accretion of $6.9 million, down $5.8 million
sequentially and down $18.0 million year-over-year.
- Net interest margin was 3.00%, up 4 bps sequentially, aided by
efficient balance sheet management.
- Non-interest revenue decreased $11.7 million, or 10%,
sequentially and decreased $5.6 million, or 5%, compared to prior
year. Adjusted non-interest revenue decreased $9.2 million, or 8%,
sequentially and decreased $5.5 million, or 5%, compared to prior
year.
- Quarter-over-quarter decline was primarily related to an $8
million BOLI benefit in the previous quarter.
- Year-over-year decline was primarily due to lower mortgage
banking income resulting from increasing mortgage rates and lower
refinancing volumes.
- Non-interest expense decreased $22.8 million, or 8%,
sequentially and increased $5.3 million, or 2%, compared to prior
year. Adjusted non-interest expense decreased $6.1 million, or 2%,
sequentially and increased $13.7 million, or 5%, compared to prior
year.
- Quarter-over-quarter decline was a result of prudent expense
management and the normalization of expense from an unusually high
fourth quarter of 2021.
- Year-over-year increase was primarily due to incentives and
costs associated with elevated performance.
- Credit quality ratios remain strong and near historical lows.
The net charge-off ratio for the quarter was 0.19%; both the
non-performing loan and asset ratios remained flat at 0.33% and
0.40%, respectively; and total past dues were 0.11% of total loans
outstanding.
- Provision for credit losses of $11.4 million compared to a
reversal of provision for credit losses of $55.2 million for the
fourth quarter of 2021; allowance for credit losses coverage ratio
(to loans) of 1.15%, a decline of 4 bps sequentially. Drivers of
the decline included positive trends in our credit performance and
loan mix mostly offset by economic uncertainty which slowed the
pace of the allowance decline this quarter.
- The effective tax rate was 19.98% for the quarter.
Capital Ratios
1Q22
4Q21
1Q21
Common equity Tier 1 capital (CET1)
ratio
9.47
%
*
9.50
%
9.74
%
Tier 1 capital ratio
10.60
*
10.66
10.99
Total risk-based capital ratio
12.53
*
12.61
13.34
Tier 1 leverage ratio
8.87
*
8.72
8.80
Tangible common equity ratio
6.80
7.52
7.55
* Ratios are preliminary.
Capital
- Preliminary CET1 ratio declined 3 bps during the quarter to
9.47%, and the preliminary total risk-based capital ratio of 12.53%
declined 8 bps from the previous quarter as capital generated
through earnings helped offset the impact of loan growth and a
$0.34 dividend for common shareholders.
First Quarter Earnings Conference Call
Synovus will host an earnings highlights conference call at 8:30
a.m. EDT on April 21, 2022. 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. is a financial services company
based in Columbus, Georgia, with approximately $56 billion in
assets. Synovus provides commercial and retail banking and a full
suite of specialized products and services, including private
banking, treasury management, wealth management, mortgage services,
premium finance, asset-based lending, structured lending, and
international banking through 272 branches in Georgia, Alabama,
South Carolina, Florida, and Tennessee. Synovus is a Great Place to
Work-Certified Company and is on the web at synovus.com and on
Twitter, Facebook, LinkedIn, and Instagram.
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 our future operating and financial
performance; expectations on our growth strategy, expense and
revenue initiatives, capital management, balance sheet management,
and future profitability; expectations on credit quality and
performance; 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, 2021, 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.
Non-GAAP Financial Measures
The measures entitled adjusted non-interest revenue; adjusted
non-interest expense; total adjusted revenue; adjusted tangible
efficiency ratio; adjusted pre-provision net revenue; adjusted net
income available to common shareholders; adjusted diluted earnings
per share; adjusted return on average assets; adjusted return on
average common equity; return on average tangible common equity;
adjusted return on average tangible common equity; and tangible
common equity ratio are not measures recognized under GAAP and
therefore are considered non-GAAP financial measures. The most
comparable GAAP measures to these measures are total non-interest
revenue; total non-interest expense; total TE revenue; efficiency
ratio-TE; pre-provision net revenue; net income available to common
shareholders; diluted earnings per share; return on average assets;
return on average common equity; and the ratio of total
shareholders' equity to total assets, respectively.
Management believes that these non-GAAP financial measures
provide meaningful additional information about Synovus to assist
management and investors in evaluating Synovus’ operating results,
financial strength, the performance of its business, and the
strength of its capital position. However, these non-GAAP financial
measures have inherent limitations as analytical tools and should
not be considered in isolation or as a substitute for analyses of
operating results or capital position as reported under GAAP. The
non-GAAP financial measures should be considered as additional
views of the way our financial measures are affected by significant
items and other factors, and since they are not required to be
uniformly applied, they may not be comparable to other similarly
titled measures at other companies. Total adjusted revenue and
adjusted non-interest revenue are measures used by management to
evaluate total TE revenue and non-interest revenue exclusive of net
investment securities gains (losses) and fair value adjustment on
non-qualified deferred compensation. Adjusted non-interest expense
and the adjusted tangible efficiency ratio are measures utilized by
management to measure the success of expense management initiatives
focused on reducing recurring controllable operating costs.
Adjusted pre-provision net revenue is used by management to
evaluate pre-tax earnings exclusive of provision for credit losses,
which can vary significantly, and other items that management
believes are not indicative of ongoing operations and affect
period-to-period comparisons. Adjusted net income available to
common shareholders, adjusted diluted earnings per share, adjusted
return on average assets, and adjusted return on average common
equity are measures used by management to evaluate operating
results exclusive of items that are not indicative of ongoing
operations and impact period-to-period comparisons. Return on
average tangible common equity and adjusted return on average
tangible common equity are measures used by management to compare
Synovus’ performance with other financial institutions because it
calculates the return available to common shareholders without the
impact of intangible assets and their related amortization, thereby
allowing management to evaluate the performance of the business
consistently. The tangible common equity ratio is used by
management to assess the strength of our capital position. The
computations of these measures are set forth in the tables
below.
Reconciliation of Non-GAAP Financial
Measures
(dollars in thousands)
1Q22
4Q21
1Q21
Adjusted non-interest revenue
Total non-interest revenue
$
105,334
$
117,068
$
110,956
Subtract/add: Investment securities
(gains) losses, net
—
(230
)
1,990
Subtract/add: Fair value adjustment on
non-qualified deferred compensation
1,295
(995
)
(792
)
Adjusted non-interest revenue
$
106,629
$
115,843
$
112,154
Adjusted non-interest expense
Total non-interest expense
$
272,450
$
295,207
$
267,134
Subtract/add: Restructuring charges
6,424
(5,958
)
(531
)
Subtract: Valuation adjustment to Visa
derivative
—
(2,656
)
—
Subtract: Loss on early extinguishment of
debt, net
(677
)
—
—
Subtract/add: Fair value adjustment on
non-qualified deferred compensation
1,295
(995
)
(792
)
Adjusted non-interest expense
$
279,492
$
285,598
$
265,811
Reconciliation of Non-GAAP Financial
Measures, continued
(dollars in thousands)
1Q22
4Q21
1Q21
Total adjusted revenue and adjusted
tangible efficiency ratio
Adjusted non-interest expense
$
279,492
$
285,598
$
265,811
Subtract: Amortization of intangibles
(2,118
)
(2,379
)
(2,379
)
Adjusted tangible non-interest expense
$
277,374
$
283,219
$
263,432
Net interest income
$
392,248
$
392,313
$
373,857
Add: Tax equivalent adjustment
865
884
774
Add: Total non-interest revenue
105,334
117,068
110,956
Total TE revenue
498,447
510,265
485,587
Subtract/add: Investment securities
(gains) losses, net
—
(230
)
1,990
Subtract/add: Fair value adjustment on
non-qualified deferred compensation
1,295
(995
)
(792
)
Total adjusted revenue
$
499,742
$
509,040
$
486,785
Efficiency ratio-TE
54.66
%
57.85
%
55.01
%
Adjusted tangible efficiency ratio
55.50
55.64
54.12
Adjusted pre-provision net
revenue
Net interest income
$
392,248
$
392,313
$
373,857
Add: Total non-interest revenue
105,334
117,068
110,956
Subtract: Non-interest expense
272,450
295,207
267,134
Pre-provision net revenue
$
225,132
$
214,174
$
217,679
Total adjusted revenue
$
499,742
$
509,040
$
486,785
Subtract: Adjusted non-interest
expense
279,492
285,598
265,811
Subtract: PPP fees
6,885
12,684
24,890
Adjusted pre-provision net revenue
$
213,365
$
210,758
$
196,084
Adjusted return on average
assets
Net income
$
171,037
$
200,401
$
187,093
Add/subtract: Restructuring charges
(6,424
)
5,958
531
Add: Valuation adjustment to Visa
derivative
—
2,656
—
Add: Loss on early extinguishment of debt,
net
677
—
—
Subtract/add: Investment securities
(gains) losses, net
—
(230
)
1,990
Add/subtract: Tax effect of adjustments
(1)
1,369
(2,121
)
(638
)
Adjusted net income
$
166,659
$
206,664
$
188,976
Net income annualized
$
693,650
$
795,069
$
758,766
Adjusted net income annualized
$
675,895
$
819,917
$
766,403
Total average assets
$
56,855,898
$
56,911,929
$
54,188,504
Return on average assets
1.22
%
1.40
%
1.40
%
Adjusted return on average assets
1.19
1.44
1.41
Reconciliation of Non-GAAP Financial
Measures, continued
(dollars in thousands)
1Q22
4Q21
1Q21
Adjusted net income available to common
shareholders and adjusted diluted earnings per share
Net income available to common
shareholders
$
162,746
$
192,110
$
178,802
Add/subtract: Restructuring charges
(6,424
)
5,958
531
Add: Valuation adjustment to Visa
derivative
—
2,656
—
Add: Loss on early extinguishment of debt,
net
677
—
—
Subtract/add: Investment securities
(gains) losses, net
—
(230
)
1,990
Add/subtract: Tax effect of adjustments
(1)
1,369
(2,121
)
(638
)
Adjusted net income available to common
shareholders
$
158,368
$
198,373
$
180,685
Weighted average common shares
outstanding, diluted
146,665
146,793
149,780
Diluted earnings per share
$
1.11
$
1.31
$
1.19
Adjusted diluted earnings per share
1.08
1.35
1.21
Adjusted return on average common
equity, return on average tangible common equity, and adjusted
return on average tangible common equity
Net income available to common
shareholders
$
162,746
$
192,110
$
178,802
Add/subtract: Restructuring charges
(6,424
)
5,958
531
Add: Valuation adjustment to Visa
derivative
—
2,656
—
Add: Loss on early extinguishment of debt,
net
677
—
—
Subtract/add: Investment securities
(gains) losses, net
—
(230
)
1,990
Add/subtract: Tax effect of adjustments
(1)
1,369
(2,121
)
(638
)
Adjusted net income available to common
shareholders
$
158,368
$
198,373
$
180,685
Adjusted net income available to common
shareholders annualized
$
642,270
$
787,023
$
732,778
Add: Amortization of intangibles,
annualized net of tax
6,543
7,050
7,207
Adjusted net income available to common
shareholders excluding amortization of intangibles annualized
$
648,813
$
794,073
$
739,985
Net income available to common
shareholders annualized
$
660,025
$
762,176
$
725,141
Add: Amortization of intangibles,
annualized net of tax
6,543
7,050
7,207
Net income available to common
shareholders excluding amortization of intangibles annualized
$
666,568
$
769,226
$
732,348
Total average shareholders' equity less
preferred stock
$
4,647,426
$
4,730,828
$
4,599,076
Subtract: Goodwill
(452,390
)
(452,390
)
(452,390
)
Subtract: Other intangible assets, net
(34,576
)
(36,805
)
(44,005
)
Total average tangible shareholders'
equity less preferred stock
$
4,160,460
$
4,241,633
$
4,102,681
Return on average common equity
14.20
%
16.11
%
15.77
%
Adjusted return on average common
equity
13.82
16.64
15.93
Return on average tangible common
equity
16.02
18.14
17.85
Adjusted return on average tangible common
equity
15.59
18.72
18.04
Reconciliation of Non-GAAP Financial
Measures, continued
(dollars in thousands)
March 31, 2022
December 31, 2021
March 31, 2021
Tangible common equity ratio
Total assets
$
56,419,549
$
57,317,226
$
55,159,011
Subtract: Goodwill
(452,390
)
(452,390
)
(452,390
)
Subtract: Other intangible assets, net
(33,478
)
(35,596
)
(42,733
)
Tangible assets
$
55,933,681
$
56,829,240
$
54,663,888
Total shareholders’ equity
$
4,824,635
$
5,296,800
$
5,161,717
Subtract: Goodwill
(452,390
)
(452,390
)
(452,390
)
Subtract: Other intangible assets, net
(33,478
)
(35,596
)
(42,733
)
Subtract: Preferred Stock, no par
value
(537,145
)
(537,145
)
(537,145
)
Tangible common equity
$
3,801,622
$
4,271,669
$
4,129,449
Total shareholders’ equity to total assets
ratio
8.55
%
9.24
%
9.36
%
Tangible common equity ratio
6.80
7.52
7.55
(1) An assumed marginal tax rate of 23.8%
for 2022 and 25.3% for 2021 was applied.
Synovus
INCOME STATEMENT DATA
(Unaudited)
(Dollars in thousands, except per share
data)
2022
2021
First Quarter
First
Fourth
Third
Second
First
'22 vs '21
Quarter
Quarter
Quarter
Quarter
Quarter
% Change
Interest income
$
416,062
418,279
412,504
412,743
409,817
2
%
Interest expense
23,814
25,966
27,587
30,883
35,960
(34
)
Net interest income
392,248
392,313
384,917
381,860
373,857
5
Provision for (reversal of) credit
losses
11,400
(55,210
)
(7,868
)
(24,598
)
(18,575
)
nm
Net interest income after provision for
credit losses
380,848
447,523
392,785
406,458
392,432
(3
)
Non-interest revenue:
Service charges on deposit accounts
22,539
22,221
22,641
21,414
20,033
13
Fiduciary and asset management fees
20,277
20,602
19,786
18,805
17,954
13
Card fees
14,756
12,861
13,238
13,304
11,996
23
Brokerage revenue
14,655
14,795
14,745
13,926
12,974
13
Mortgage banking income
5,953
7,059
11,155
13,842
22,315
(73
)
Capital markets income
5,472
7,188
8,089
3,335
7,505
(27
)
Income from bank-owned life insurance
6,556
15,168
6,820
7,188
8,843
(26
)
Investment securities gains (losses),
net
—
230
962
—
(1,990
)
nm
Other non-interest revenue
15,126
16,944
17,519
15,273
11,326
34
Total non-interest revenue
105,334
117,068
114,955
107,087
110,956
(5
)
Non-interest expense:
Salaries and other personnel expense
164,684
167,018
160,364
160,567
161,477
2
Net occupancy, equipment, and software
expense
42,877
42,780
43,483
41,825
41,134
4
Third-party processing and other
services
20,996
22,791
19,446
24,419
20,032
5
Professional fees
8,474
9,014
6,739
7,947
9,084
(7
)
FDIC insurance and other regulatory
fees
6,250
6,016
5,212
5,547
5,579
12
Restructuring charges
(6,424
)
5,958
319
415
531
nm
Other operating expenses
35,593
41,630
31,469
29,811
29,297
21
Total non-interest expense
272,450
295,207
267,032
270,531
267,134
2
Income before income taxes
213,732
269,384
240,708
243,014
236,254
(10
)
Income tax expense
42,695
68,983
53,935
56,814
49,161
(13
)
Net income
171,037
200,401
186,773
186,200
187,093
(9
)
Less: Preferred stock dividends
8,291
8,291
8,291
8,291
8,291
—
Net income available to common
shareholders
$
162,746
192,110
178,482
177,909
178,802
(9
)%
Net income per common share, basic
$
1.12
1.32
1.22
1.20
1.20
(7
)%
Net income per common share, diluted
1.11
1.31
1.21
1.19
1.19
(7
)
Cash dividends declared per common
share
0.34
0.33
0.33
0.33
0.33
3
Return on average assets *
1.22
%
1.40
1.34
1.36
1.40
(18) bps
Return on average common equity *
14.20
16.11
14.96
15.40
15.77
(157
)
Weighted average common shares
outstanding, basic
145,273
145,316
146,308
148,113
148,467
(2
)%
Weighted average common shares
outstanding, diluted
146,665
146,793
147,701
149,747
149,780
(2
)
nm - not meaningful
bps - basis points
* - ratios are annualized
Synovus
BALANCE SHEET DATA
March 31, 2022
December 31, 2021
March 31, 2021
(Unaudited)
(In thousands, except share data)
ASSETS
Cash and due from banks
$
557,178
$
432,925
$
493,645
Interest-bearing funds with Federal
Reserve Bank
941,272
2,479,006
2,722,100
Interest earning deposits with banks
27,411
25,535
23,969
Federal funds sold and securities
purchased under resale agreements
27,642
72,387
88,552
Cash, cash equivalents, and restricted
cash
1,553,503
3,009,853
3,328,266
Investment securities available for sale,
at fair value
10,463,101
10,918,329
8,825,757
Loans held for sale ($111,992, $108,198,
and $242,010 measured at fair value, respectively)
723,921
750,642
993,887
Loans, net of deferred fees and costs
40,169,150
39,311,958
38,805,101
Allowance for loan losses
(414,956
)
(427,597
)
(563,214
)
Loans, net
39,754,194
38,884,361
38,241,887
Cash surrender value of bank-owned life
insurance
1,075,175
1,068,616
1,054,475
Premises, equipment, and software, net
386,631
407,241
454,911
Goodwill
452,390
452,390
452,390
Other intangible assets, net
33,478
35,596
42,733
Other assets
1,977,156
1,790,198
1,764,705
Total assets
$
56,419,549
$
57,317,226
$
55,159,011
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Deposits:
Non-interest-bearing deposits
$
16,611,344
$
16,392,653
$
14,660,287
Interest-bearing deposits
32,044,900
33,034,623
32,708,664
Total deposits
48,656,244
49,427,276
47,368,951
Federal funds purchased and securities
sold under repurchase agreements
501,124
264,133
293,659
Long-term debt
805,259
1,204,229
1,202,825
Other liabilities
1,632,287
1,124,788
1,131,859
Total liabilities
51,594,914
52,020,426
49,997,294
Shareholders' equity:
Preferred stock - no par value. Authorized
100,000,000 shares; issued 22,000,000
537,145
537,145
537,145
Common stock - $1.00 par value. Authorized
342,857,143 shares; issued 169,912,021, 169,383,758, and
168,978,380; outstanding 145,334,763, 145,010,086, and
148,888,513
169,912
169,384
168,978
Additional paid-in capital
3,899,269
3,894,109
3,864,281
Treasury stock, at cost – 24,577,258,
24,373,672, and 20,089,867 shares
(941,168
)
(931,497
)
(731,690
)
Accumulated other comprehensive income
(loss), net
(662,065
)
(82,321
)
15,278
Retained earnings
1,821,542
1,709,980
1,307,725
Total shareholders’ equity
4,824,635
5,296,800
5,161,717
Total liabilities and shareholders'
equity
$
56,419,549
$
57,317,226
$
55,159,011
Synovus
AVERAGE BALANCES, INTEREST, AND
YIELDS/RATES
(Unaudited)
First Quarter 2022
Fourth Quarter 2021
First Quarter 2021
(dollars in thousands)
Average Balance
Interest
Yield/ Rate
Average Balance
Interest
Yield/ Rate
Average Balance
Interest
Yield/ Rate
Assets
Interest earning assets:
Commercial loans (1) (2) (3)
$
30,756,752
$
280,588
3.70
%
$
29,685,876
$
286,513
3.83
%
$
29,924,651
$
291,200
3.95
%
Consumer loans (1) (2)
8,594,009
81,368
3.81
8,679,721
83,836
3.89
8,287,616
82,065
3.83
Less: Allowance for loan losses
(423,953
)
—
—
(474,972
)
—
—
(599,872
)
—
—
Loans, net
38,926,808
361,956
3.76
37,890,625
370,349
3.88
37,612,395
373,265
4.02
Investment securities available for
sale
11,259,800
47,250
1.68
10,884,571
41,447
1.52
8,437,563
29,458
1.40
Trading account assets
9,078
39
1.73
11,280
42
1.50
3,063
22
2.81
Other earning assets(4)
1,919,531
815
0.17
3,186,271
1,208
0.15
2,838,063
716
0.10
FHLB and Federal Reserve Bank stock
160,065
685
1.71
159,933
919
2.30
157,657
668
1.69
Mortgage loans held for sale
103,887
882
3.40
130,786
1,009
3.09
246,962
1,657
2.68
Other loans held for sale
597,062
5,300
3.55
518,992
4,189
3.16
660,753
4,805
2.91
Total interest earning assets
52,976,231
$
416,927
3.18
%
52,782,458
$
419,163
3.16
%
49,956,456
$
410,591
3.32
%
Cash and due from banks
548,684
541,788
518,738
Premises and equipment
398,774
421,577
460,466
Other real estate
11,759
1,351
1,823
Cash surrender value of bank-owned life
insurance
1,070,886
1,067,004
1,051,520
Other assets(5)
1,849,564
2,097,751
2,199,501
Total assets
$
56,855,898
$
56,911,929
$
54,188,504
Liabilities and Shareholders'
Equity
Interest-bearing liabilities:
Interest-bearing demand deposits
$
9,549,527
$
2,372
0.10
%
$
9,165,054
$
2,238
0.10
%
$
8,570,753
$
2,973
0.14
%
Money market accounts
16,045,627
5,349
0.14
15,998,203
5,562
0.14
15,348,916
8,730
0.23
Savings deposits
1,460,648
67
0.02
1,408,858
65
0.02
1,219,288
49
0.02
Time deposits
3,009,795
2,138
0.29
3,163,062
2,599
0.33
4,155,302
7,042
0.69
Brokered deposits
2,788,124
3,733
0.54
2,836,841
3,980
0.56
3,369,333
6,224
0.75
Federal funds purchased and securities
sold under repurchase agreements
194,352
11
0.02
227,664
24
0.04
209,448
34
0.07
Other short-term borrowings
4,653
—
—
—
—
—
—
—
—
Long-term debt
982,423
10,144
4.13
1,203,959
11,498
3.82
1,202,613
10,908
3.63
Total interest-bearing liabilities
34,035,149
$
23,814
0.28
%
34,003,641
$
25,966
0.30
%
34,075,653
$
35,960
0.42
%
Non-interest-bearing demand deposits
16,491,643
16,545,203
13,791,286
Other liabilities
1,144,535
1,095,112
1,185,344
Shareholders' equity
5,184,571
5,267,973
5,136,221
Total liabilities and shareholders'
equity
$
56,855,898
$
56,911,929
$
54,188,504
Net interest income and net interest
margin, taxable equivalent (6)
$
393,113
3.00
%
$
393,197
2.96
%
$
374,631
3.04
%
Less: taxable-equivalent adjustment
865
884
774
Net interest income
$
392,248
$
392,313
$
373,857
(1)
Average loans are shown net of deferred fees and costs. NPLs are
included.
(2)
Interest income includes net loan fees as follows: First Quarter
2022 — $20.7 million, Fourth Quarter 2021 — $24.7 million, and
First Quarter 2021 — $31.9 million.
(3)
Reflects taxable-equivalent adjustments, using the statutory
federal tax rate of 21%, in adjusting interest on tax-exempt loans
and investment securities to a taxable-equivalent basis.
(4)
Includes interest-bearing funds with Federal Reserve Bank,
interest earning deposits with banks, and federal funds sold and
securities purchased under resale agreements.
(5)
Includes average net unrealized gains/(losses) on investment
securities available for sale of $(247.4) million, $(34.2) million,
and $116.1 million for the First Quarter 2022, Fourth Quarter 2021,
and First Quarter 2021, respectively.
(6)
The net interest margin is calculated by dividing annualized net
interest income-taxable equivalent by average total interest
earning assets.
Synovus
LOANS OUTSTANDING BY TYPE
(Unaudited)
Total Loans
Total Loans
Linked Quarter
Total Loans
Year/Year
(Dollars in thousands)
Loan Type
March 31,
2022
December 31,
2021
%
Change
March 31,
2021
%
Change
Commercial, Financial, and
Agricultural
$
12,659,611
$
12,147,858
4
%
$
12,748,106
(1
)%
Owner-Occupied
7,692,714
7,475,066
3
7,031,505
9
Total Commercial &
Industrial
20,352,325
19,622,924
4
19,779,611
3
Multi-Family
2,288,497
2,129,424
7
2,220,939
3
Hotels
1,593,983
1,537,060
4
1,462,370
9
Office Buildings
2,521,381
2,511,058
—
2,280,053
11
Shopping Centers
1,500,768
1,655,465
(9
)
1,627,933
(8
)
Warehouses
814,756
801,639
2
692,267
18
Other Investment Property
1,327,760
1,268,130
5
1,052,163
26
Total Investment Properties
10,047,145
9,902,776
1
9,335,725
8
1-4 Family Construction
229,038
206,881
11
189,626
21
1-4 Family Investment Mortgage
391,636
438,588
(11
)
449,328
(13
)
Total 1-4 Family Properties
620,674
645,469
(4
)
638,954
(3
)
Commercial Development
102,757
102,790
—
142,380
(28
)
Residential Development
193,580
171,820
13
196,653
(2
)
Land Acquisition
181,162
192,256
(6
)
220,216
(18
)
Land and Development
477,499
466,866
2
559,249
(15
)
Total Commercial Real Estate
11,145,318
11,015,111
1
10,533,928
6
Consumer Mortgages
5,052,003
5,068,998
—
5,299,130
(5
)
Home Equity
1,416,341
1,361,419
4
1,460,866
(3
)
Credit Cards
188,247
204,172
(8
)
181,594
4
Other Consumer Loans
2,014,916
2,039,334
(1
)
1,549,972
30
Total Consumer
8,671,507
8,673,923
—
8,491,562
2
Total
$
40,169,150
$
39,311,958
2
%
$
38,805,101
4
%
NON-PERFORMING LOANS
COMPOSITION
(Unaudited)
Total
Non-performing
Loans
Total
Non-performing
Loans
Linked
Quarter
Total
Non-performing
Loans
Year/Year
(Dollars in thousands)
Loan Type
March 31,
2022
December 31,
2021
%
Change
March 31,
2021
%
Change
Commercial, Financial, and
Agricultural
$
64,888
$
61,787
5
%
$
76,460
(15
)%
Owner-Occupied
10,854
11,196
(3
)
17,192
(37
)
Total Commercial &
Industrial
75,742
72,983
4
93,652
(19
)
Multi-Family
2,639
2,380
11
2,698
(2
)
Office Buildings
2,205
1,615
37
1,645
34
Shopping Centers
915
915
—
20,138
(95
)
Warehouses
482
223
116
221
118
Other Investment Property
1,047
717
46
887
18
Total Investment Properties
7,288
5,850
25
25,589
(72
)
1-4 Family Construction
55
55
—
1,291
(96
)
1-4 Family Investment Mortgage
2,187
4,508
(51
)
2,760
(21
)
Total 1-4 Family Properties
2,242
4,563
(51
)
4,051
(45
)
Commercial Development
625
449
39
567
10
Residential Development
407
446
(9
)
452
(10
)
Land Acquisition
1,021
1,023
—
782
31
Land and Development
2,053
1,918
7
1,801
14
Total Commercial Real Estate
11,583
12,331
(6
)
31,441
(63
)
Consumer Mortgages
29,997
29,078
3
11,201
168
Home Equity
8,854
9,773
(9
)
12,207
(27
)
Other Consumer Loans
5,955
6,877
(13
)
6,668
(11
)
Total Consumer
44,806
45,728
(2
)
30,076
49
Total
$
132,131
$
131,042
1
%
$
155,169
(15
)%
Synovus
CREDIT QUALITY DATA
(Unaudited)
(Dollars in thousands)
2022
2021
First Quarter
First
Fourth
Third
Second
First
'22 vs '21
Quarter
Quarter
Quarter
Quarter
Quarter
% Change
Non-performing Loans (NPLs)
$
132,131
131,042
155,465
161,028
155,169
(15
)%
Impaired Loans Held for Sale
—
—
—
—
23,590
nm
Other Real Estate and Other Assets
26,759
27,137
16,883
16,806
16,849
59
Non-performing Assets (NPAs)
158,890
158,179
172,348
177,834
195,608
(19
)
Allowance for Loan Losses (ALL)
414,956
427,597
492,243
516,708
563,214
(26
)
Reserve for Unfunded Commitments
47,317
41,885
42,971
46,890
51,528
(8
)
Allowance for Credit Losses (ACL)
462,273
469,482
535,214
563,598
614,742
(25
)
Net Charge-Offs - Quarter
18,609
10,522
20,516
26,547
20,204
Net Charge-Offs - YTD
18,609
77,788
67,266
46,750
20,204
Net Charge-Offs / Average Loans - Quarter
(1)
0.19
%
0.11
0.22
0.28
0.21
Net Charge-Offs / Average Loans - YTD
(1)
0.19
0.20
0.24
0.24
0.21
NPLs / Loans
0.33
0.33
0.41
0.42
0.40
NPAs / Loans, ORE and specific other
assets
0.40
0.40
0.45
0.46
0.50
ACL/Loans
1.15
1.19
1.40
1.47
1.58
ALL/Loans
1.03
1.09
1.28
1.35
1.45
ACL/NPLs
349.86
358.27
344.27
350.00
396.18
ALL/NPLs
314.05
326.31
316.63
320.88
362.97
Past Due Loans over 90 days and Still
Accruing
$
3,067
6,770
5,960
4,415
3,804
(19
)
As a Percentage of Loans Outstanding
0.01
%
0.02
0.02
0.01
0.01
Total Past Due Loans and Still
Accruing
$
45,385
57,565
60,817
49,321
45,693
(1
)
As a Percentage of Loans Outstanding
0.11
%
0.15
0.16
0.13
0.12
Accruing Troubled Debt Restructurings
(TDRs)
$
145,957
119,804
126,055
124,528
129,776
12
(1) Ratio is annualized.
SELECTED CAPITAL INFORMATION
(1)
(Unaudited)
(Dollars in thousands)
March 31,
December 31,
March 31,
2022
2021
2021
Common Equity Tier 1 Capital Ratio
9.47
%
9.50
9.74
Tier 1 Capital Ratio
10.60
10.66
10.99
Total Risk-Based Capital Ratio
12.53
12.61
13.34
Tier 1 Leverage Ratio
8.87
8.72
8.80
Common Equity as a Percentage of Total
Assets (2)
7.60
8.30
8.38
Tangible Common Equity Ratio (3) (5)
6.80
7.52
7.55
Book Value Per Common Share (4)
$
29.50
32.82
31.06
Tangible Book Value Per Common Share
(3)
26.16
29.46
27.74
(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.
(5) See "Non-GAAP Financial Measures" of
this report for applicable reconciliation.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220420005799/en/
Media Contact Alison Dowe Media Relations (706)
641-3781
Investor Contact Cal Evans Investor Relations (706)
641-6500
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