Diluted earnings per share of $1.32 vs.
$1.11 in 1Q22
Adjusted diluted earnings per share of $1.33
vs. $1.08 in 1Q22
Synovus Financial Corp. (NYSE: SNV) today reported financial
results for the quarter ended March 31, 2023. “Our first quarter
results reflect a disciplined approach to execution, with
pre-provision net revenue of $292 million, a 30% increase year over
year,” said Synovus Chairman, CEO and President Kevin Blair. “Our
stable deposit base and record deposit production are testaments to
the quality of our clients and ability to expand existing and
attract new relationships even in this environment. The recent J.D.
Power recognition as the Southeast’s number one bank in retail
client satisfaction and trust affirms the value of our commitment
to tailored solutions, local market presence and personal
relationships. Our team continues to exercise prudence and
perseverance as we focus on profitable growth and meet the future
needs of clients and communities we serve.”
First Quarter 2023 Highlights
- Net income available to common shareholders of $193.9 million,
or $1.32 per diluted share, up $0.21 compared to the first quarter
2022.
- Total revenue of $613.9 million increased $116.3 million, or
23%, compared to the first quarter 2022, driven by loan growth and
higher interest rates, in addition to growth in core client fee
income, excluding mortgage, of 19% year over year.
- Pre-provision net revenue of $292.0 million increased $66.9
million, or 30%, compared to the first quarter 2022.
- Period-end loans increased $328.6 million sequentially,
primarily driven by new commercial production offset by a decline
in third-party consumer loans from both runoff and a move to
held-for-sale of $424 million.
- Total deposits increased $1.08 billion sequentially, or 2%, a
result of growth in both core as well as brokered deposits.
- Fortified our liquidity position and currently maintain over
$25 billion(1) of contingent liquidity across a diverse set of
sources.
- Credit quality metrics continue to remain at strong levels with
a net charge-off ratio of 0.17% and a modest increase in the ACL
ratio to 1.17%. The NPL and NPA ratios both moved to 0.41%.
- Preliminary CET1 ratio of 9.76% increased 13 bps sequentially
as capital generation continued to support client loan growth while
also buffering capital levels given economic and regulatory
uncertainty.
(1) As of April 17, 2023
First Quarter Summary
Reported
Adjusted
(dollars in thousands)
1Q23
4Q22
1Q22
1Q23
4Q22
1Q22
Net income available to common
shareholders
$
193,868
$
197,479
$
162,746
$
195,276
$
197,576
$
158,368
Diluted earnings per share
1.32
1.35
1.11
1.33
1.35
1.08
Total revenue
613,877
603,785
497,582
599,469
603,359
499,742
Total loans
44,044,939
43,716,353
40,169,150
N/A
N/A
N/A
Total deposits
49,953,936
48,871,559
48,656,244
N/A
N/A
N/A
Return on avg assets
1.36
%
1.38
%
1.22
%
1.37
%
1.39
%
1.19
%
Return on avg common equity
19.23
20.93
14.20
19.37
20.94
13.82
Return on avg tangible common equity
21.94
24.21
16.02
22.09
24.22
15.59
Net interest margin(1)
3.43
3.56
3.01
N/A
N/A
N/A
Efficiency ratio-TE(2)(3)
52.33
51.08
54.66
50.48
50.58
55.50
NCO ratio-QTD
0.17
0.12
0.19
N/A
N/A
N/A
NPA ratio
0.41
0.33
0.40
N/A
N/A
N/A
(1) NIM reflects Actual/Actual day count
and includes other immaterial adjustments versus NIM previously
reported.
(2) Taxable equivalent
(3) Adjusted tangible efficiency ratio
Balance Sheet
Loans*
(dollars in millions)
1Q23
4Q22
Linked Quarter Change
Linked Quarter %
Change
1Q22
Year/Year Change
Year/Year % Change
Commercial & industrial
$
22,600.2
$
22,066.7
$
533.5
2
%
$
20,352.3
$
2,247.9
11
%
Commercial real estate
12,996.8
12,650.3
346.4
3
11,145.3
1,851.4
17
Consumer
8,448.0
8,999.4
(551.4
)
(6
)
8,671.5
(223.5
)
(3
)
Total loans
$
44,044.9
$
43,716.4
$
328.6
1
%
$
40,169.2
$
3,875.8
10
%
*Amounts may not total due to rounding
- Total loans ended the quarter at $44.04 billion, up $328.6
million sequentially.
- Commercial and industrial (C&I) loans increased $533.5
million sequentially, led by broad-based growth within our
Wholesale Banking segment across multiple industries and business
lines.
- CRE loans increased $346.4 million sequentially as low levels
of production were more than offset by slower payoffs and draws
related to existing commitments.
- Consumer loans decreased $551.4 million sequentially, largely a
result of third-party decline from both runoff and a $424 million
move to held-for-sale.
Deposits*
(dollars in millions)
1Q23
4Q22
Linked Quarter Change
Linked Quarter %
Change
1Q22
Year/Year Change
Year/Year % Change
Non-interest-bearing DDA
$
13,827.6
$
14,574.5
$
(746.9
)
(5
)%
$
15,526.7
$
(1,699.1
)
(11
)%
Interest-bearing DDA
5,837.0
5,761.4
75.7
1
6,685.4
(848.3
)
(13
)
Money market
11,780.0
12,480.7
(700.8
)
(6
)
14,596.9
(2,816.9
)
(19
)
Savings
1,312.7
1,396.4
(83.8
)
(6
)
1,476.7
(164.0
)
(11
)
Public funds
6,888.2
6,635.6
252.6
4
6,048.7
839.5
14
Time deposits
4,060.3
2,724.1
1,336.2
49
2,284.2
1,776.1
78
Brokered deposits
6,248.3
5,299.0
949.2
18
2,037.7
4,210.6
207
Total deposits
$
49,953.9
$
48,871.6
$
1,082.4
2
%
$
48,656.2
$
1,297.7
3
%
*Amounts may not total due to rounding
- Total deposits ended the quarter at $49.95 billion, up $1.08
billion sequentially and resulted from relationship-based
production in addition to increased brokered deposits as a result
of proactive management of our liquidity position, partially offset
by the impact of non-interest bearing DDAs decline due to
commercial seasonality, normal cash deployment, and to a lesser
extent, continued rate pressures.
- Total deposit costs increased 56 bps sequentially to 1.44% and
were primarily impacted by the continued rising rate environment
and aforementioned mix shift.
Income Statement Summary**
(in thousands, except per share data)
1Q23
4Q22
Linked Quarter Change
Linked Quarter %
Change
1Q22
Year/Year Change
Year/Year % Change
Net interest income
$
480,751
$
501,346
$
(20,595
)
(4
)%
$
392,248
$
88,503
23
%
Non-interest revenue
133,126
102,439
30,687
30
105,334
27,792
26
Non-interest expense
321,852
308,996
12,856
4
272,450
49,402
18
Provision for (reversal of) credit
losses
32,154
34,884
(2,730
)
(8
)
11,400
20,754
182
Income before taxes
$
259,871
$
259,905
$
(34
)
—
%
$
213,732
$
46,139
22
%
Income tax expense
57,712
54,135
3,577
7
42,695
15,017
35
Preferred stock dividends
8,291
8,291
—
—
8,291
—
—
Net income available to common
shareholders
$
193,868
$
197,479
$
(3,611
)
(2
)%
$
162,746
$
31,122
19
%
Weighted average common shares
outstanding, diluted
146,727
146,528
199
—
%
146,665
62
—
%
Diluted earnings per share
$
1.32
$
1.35
$
(0.03
)
(2
)
$
1.11
$
0.21
19
Adjusted diluted earnings per share
1.33
1.35
(0.02
)
(1
)
1.08
0.25
23
Effective tax rate
22.21
%
20.83
%
19.98
%
** Amounts may not total due to
rounding
Core Performance
- Net interest income of $480.8 million was down $20.6 million
sequentially, or 4%, and increased $88.5 million, or 23%, compared
to the first quarter 2022.
- The quarter-over-quarter decline was largely driven by lower
day count, increases in deposit costs, and negative remixing from
non-interest DDA deposits partially offset by higher asset yields
and earning asset growth.
- Net interest margin was 3.43%, down 13 bps sequentially,
impacted by the same factors mentioned above as well as higher cash
balances due to precautionary March liquidity actions.
- The year-over-year increase resulted primarily from loan growth
and interest rate increases somewhat offset by higher deposit costs
and negative remixing from non-interest DDA deposits.
- Non-interest revenue increased $30.7 million, or 30%,
sequentially and increased $27.8 million, or 26%, compared to the
first quarter 2022 and was impacted by a $13.1 million one-time
benefit from the recovery of a non-performing asset related to the
regulatory approval of our Qualpay investment. Adjusted
non-interest revenue increased $16.7 million, or 17%, sequentially
and increased $11.0 million, or 10%, compared to the first quarter
2022.
- Increases primarily related to strong capital markets income
from syndication fees and interest rate management products and
higher wealth revenue from diverse sources including fees from
short-term liquidity management products.
- Non-interest expense increased $12.9 million, or 4%,
sequentially and increased $49.4 million, or 18%, compared to the
first quarter 2022 and was impacted by a $16.8 million loss
associated with the move of third-party consumer loans to
held-for-sale. Adjusted non-interest expense decreased $2.8
million, or 1%, sequentially and increased $25.0 million, or 9%,
compared to the first quarter 2022.
- The quarter-over-quarter increase was largely due to normal,
seasonal personnel expense and planned increases in FDIC insurance
expense and healthcare costs offset by lower performance-related
expense and well-managed operating costs.
- The year-over-year increase primarily resulted from new
business initiatives, core operating costs including investments in
and expansion of our workforce, and costs associated with the
industrywide increase in FDIC insurance and healthcare costs.
- Overall credit performance and the credit quality of our recent
originations remain strong. The non-performing loan and asset
ratios both moved to 0.41%; the net charge-off ratio for the
quarter was 0.17%, and total past dues were 0.12% of total loans
outstanding.
- Provision for credit losses of $32.2 million decreased $2.7
million sequentially and increased $20.8 million compared to the
first quarter 2022. Drivers of the year-over-year increase included
loan growth and a modest increase in the allowance for credit
losses coverage ratio (to loans) of 2 bps, a result of
deterioration in forecasted economic scenarios mostly offset by
continued strong loan portfolio performance.
Capital Ratios
1Q23
4Q22
1Q22
Common equity Tier 1 capital (CET1)
ratio
9.76
%
*
9.63
%
9.49
%
Tier 1 capital ratio
10.79
*
10.68
10.63
Total risk-based capital ratio
12.69
*
12.54
12.56
Tier 1 leverage ratio
9.14
*
9.07
8.87
Tangible common equity ratio
6.12
5.84
6.80
* Ratios are preliminary.
Capital
- Preliminary CET1 ratio improved 13 bps during the quarter to
9.76%, and the preliminary total risk-based capital ratio of 12.69%
increased 15 bps from the previous quarter as core earnings
continued to support robust capital generation.
First Quarter Earnings Conference Call
Synovus will host an earnings highlights conference call at 8:30
a.m. ET on April 20, 2023. 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 $62 billion in
assets. Synovus provides commercial and consumer 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, capital
markets and international banking. Synovus has 245 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, 2022, 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,
non-interest expense; adjusted revenue; adjusted tangible
efficiency ratio; 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; 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. Adjusted non-interest revenue
and adjusted revenue are measures used by management to evaluate
non-interest revenue and TE revenue exclusive of net investment
securities gains (losses), fair value adjustment on non-qualified
deferred compensation, and other items not indicative of ongoing
operations that could impact period-to-period comparisons. 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 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)
1Q23
4Q22
1Q22
Adjusted non-interest revenue
Total non-interest revenue
$
133,126
$
102,439
$
105,334
Investment securities (gains) losses,
net
(1,030
)
—
—
Recovery of NPA
(13,126
)
—
—
Fair value adjustment on non-qualified
deferred compensation
(1,371
)
(1,557
)
1,295
Adjusted non-interest revenue
$
117,599
$
100,882
$
106,629
Adjusted non-interest expense
Total non-interest expense
$
321,852
$
308,996
$
272,450
Loss on other loans held for sale
(16,750
)
—
—
Loss on early extinguishment of debt
—
—
(677
)
Restructuring (charges) reversals
733
2,372
6,424
Valuation adjustment to Visa
derivative
—
(2,500
)
—
Fair value adjustment on non-qualified
deferred compensation
(1,371
)
(1,557
)
1,295
Adjusted non-interest expense
$
304,464
$
307,311
$
279,492
Reconciliation of Non-GAAP Financial
Measures, continued
(dollars in thousands)
1Q23
4Q22
1Q22
Adjusted revenue and tangible
efficiency ratio
Adjusted non-interest expense
$
304,464
$
307,311
$
279,492
Amortization of intangibles
(1,857
)
(2,118
)
(2,118
)
Adjusted tangible non-interest expense
$
302,607
$
305,193
$
277,374
Net interest income
$
480,751
$
501,346
$
392,248
Tax equivalent adjustment
1,119
1,131
865
Total non-interest revenue
133,126
102,439
105,334
Total TE revenue
$
614,996
$
604,916
$
498,447
Recovery of NPA
(13,126
)
—
—
Investment securities losses (gains),
net
(1,030
)
—
—
Fair value adjustment on non-qualified
deferred compensation
(1,371
)
(1,557
)
1,295
Adjusted revenue
$
599,469
$
603,359
$
499,742
Efficiency ratio-TE
52.33
%
51.08
%
54.66
%
Adjusted tangible efficiency ratio
50.48
50.58
55.50
Adjusted return on average
assets
Net income
$
202,159
$
205,770
$
171,037
Recovery of NPA
(13,126
)
—
—
Loss on other loans held for sale
16,750
—
—
Loss on early extinguishment of debt
—
—
677
Restructuring charges (reversals)
(733
)
(2,372
)
(6,424
)
Valuation adjustment to Visa
derivative
—
2,500
—
Investment securities losses (gains),
net
(1,030
)
—
—
Tax effect of adjustments(1)
(453
)
(31
)
1,369
Adjusted net income
$
203,567
$
205,867
$
166,659
Net income annualized
$
819,867
$
816,370
$
693,650
Adjusted net income annualized
$
825,577
$
816,755
$
675,895
Total average assets
$
60,133,561
$
58,963,417
$
56,855,898
Return on average assets
1.36
%
1.38
%
1.22
%
Adjusted return on average assets
1.37
1.39
1.19
Adjusted net income available to common
shareholders and adjusted diluted earnings per share
Net income available to common
shareholders
$
193,868
$
197,479
$
162,746
Recovery of NPA
(13,126
)
—
—
Loss on other loans held for sale
16,750
—
—
Loss on early extinguishment of debt
—
—
677
Restructuring charges (reversals)
(733
)
(2,372
)
(6,424
)
Valuation adjustment to Visa
derivative
—
2,500
—
Investment securities losses (gains),
net
(1,030
)
—
—
Tax effect of adjustments(1)
(453
)
(31
)
1,369
Adjusted net income available to common
shareholders
$
195,276
$
197,576
$
158,368
Weighted average common shares
outstanding, diluted
146,727
146,528
146,665
Diluted earnings per share
$
1.32
$
1.35
$
1.11
Adjusted diluted earnings per share
1.33
1.35
1.08
Reconciliation of Non-GAAP Financial
Measures, continued
(dollars in thousands)
1Q23
4Q22
1Q22
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
$
193,868
$
197,479
$
162,746
Recovery of NPA
(13,126
)
—
—
Loss on other loans held for sale
16,750
—
—
Loss on early extinguishment of debt
—
—
677
Restructuring charges (reversals)
(733
)
(2,372
)
(6,424
)
Valuation adjustment to Visa
derivative
—
2,500
—
Investment securities losses (gains),
net
(1,030
)
—
—
Tax effect of adjustments(1)
(453
)
(31
)
1,369
Adjusted net income available to common
shareholders
$
195,276
$
197,576
$
158,368
Adjusted net income available to common
shareholders annualized
$
791,953
$
783,861
$
642,270
Amortization of intangibles, tax effected,
annualized
5,699
6,358
6,543
Adjusted net income available to common
shareholders excluding amortization of intangibles annualized
$
797,652
$
790,219
$
648,813
Net income available to common
shareholders annualized
$
786,242
$
783,476
$
660,025
Amortization of intangibles, tax effected,
annualized
5,699
6,358
6,543
Net income available to common
shareholders excluding amortization of intangibles annualized
$
791,941
$
789,834
$
666,568
Total average shareholders' equity less
preferred stock
$
4,088,777
$
3,742,927
$
4,647,426
Average goodwill
(452,390
)
(452,390
)
(452,390
)
Average other intangible assets, net
(26,245
)
(28,174
)
(34,576
)
Total average tangible shareholders'
equity less preferred stock
$
3,610,142
$
3,262,363
$
4,160,460
Return on average common equity
19.23
%
20.93
%
14.20
%
Adjusted return on average common
equity
19.37
20.94
13.82
Return on average tangible common
equity
21.94
24.21
16.02
Adjusted return on average tangible common
equity
22.09
24.22
15.59
(dollars in thousands)
March 31, 2023
December 31, 2022
March 31, 2022
Tangible common equity ratio
Total assets
$
61,840,025
$
59,731,378
$
56,419,549
Goodwill
(452,390
)
(452,390
)
(452,390
)
Other intangible assets, net
(25,267
)
(27,124
)
(33,478
)
Tangible assets
$
61,362,368
$
59,251,864
$
55,933,681
Total shareholders’ equity
$
4,770,130
$
4,475,801
$
4,824,635
Goodwill
(452,390
)
(452,390
)
(452,390
)
Other intangible assets, net
(25,267
)
(27,124
)
(33,478
)
Preferred Stock, no par value
(537,145
)
(537,145
)
(537,145
)
Tangible common equity
$
3,755,328
$
3,459,142
$
3,801,622
Total shareholders’ equity to total assets
ratio
7.71
%
7.49
%
8.55
%
Tangible common equity ratio
6.12
5.84
6.80
(1) An assumed marginal tax rate of 24.3%
for 1Q23 and 4Q22 and 23.8% for 1Q22 was applied.
Synovus
INCOME STATEMENT DATA
(Unaudited)
(Dollars in thousands, except per share
data)
2023
2022
First Quarter
First Quarter
Fourth Quarter
Third Quarter
Second Quarter
First Quarter
'23 vs '22
% Change
Interest income
$
716,879
654,654
551,299
453,772
416,062
72
%
Interest expense
236,128
153,308
73,380
28,384
23,814
892
Net interest income
480,751
501,346
477,919
425,388
392,248
23
Provision for (reversal of) credit
losses
32,154
34,884
25,581
12,688
11,400
182
Net interest income after provision for
credit losses
448,597
466,462
452,338
412,700
380,848
18
Non-interest revenue:
Service charges on deposit accounts
22,974
23,639
23,398
23,491
22,539
2
Fiduciary and asset management fees
19,696
18,836
19,201
20,100
20,277
(3
)
Card fees
15,824
15,887
15,101
16,089
14,756
7
Brokerage revenue
22,558
19,996
17,140
15,243
14,655
54
Mortgage banking income
3,858
2,554
5,065
3,904
5,953
(35
)
Capital markets income
13,725
6,998
6,839
7,393
5,472
151
Income from bank-owned life insurance
7,262
7,206
6,792
9,165
6,556
11
Investment securities gains (losses),
net
1,030
—
—
—
—
nm
Recovery of NPA
13,126
—
—
—
—
nm
Other non-interest revenue
13,073
7,323
10,762
1,881
15,126
(14
)
Total non-interest revenue
133,126
102,439
104,298
97,266
105,334
26
Non-interest expense:
Salaries and other personnel expense
188,924
182,629
173,334
161,063
164,684
15
Net occupancy, equipment, and software
expense
42,860
45,192
43,462
43,199
42,877
—
Third-party processing and other
services
21,833
23,130
22,539
21,952
20,996
4
Professional fees
8,963
11,096
6,755
10,865
8,474
6
FDIC insurance and other regulatory
fees
10,268
8,232
7,707
6,894
6,250
64
Restructuring charges (reversals)
(733
)
(2,372
)
956
(1,850
)
(6,424
)
nm
Loss on other loans held for sale
16,750
—
—
—
—
nm
Other operating expenses
32,987
41,089
39,257
39,928
35,593
(7
)
Total non-interest expense
321,852
308,996
294,010
282,051
272,450
18
Income before income taxes
259,871
259,905
262,626
227,915
213,732
22
Income tax expense
57,712
54,135
59,582
49,863
42,695
35
Net income
202,159
205,770
203,044
178,052
171,037
18
Less: Preferred stock dividends
8,291
8,291
8,291
8,291
8,291
—
Net income available to common
shareholders
$
193,868
197,479
194,753
169,761
162,746
19
%
Net income per common share, basic
$
1.33
1.36
1.34
1.17
1.12
19
%
Net income per common share, diluted
1.32
1.35
1.33
1.16
1.11
19
Cash dividends declared per common
share
0.38
0.34
0.34
0.34
0.34
12
Return on average assets *
1.36
%
1.38
1.39
1.26
1.22
14
bps
Return on average common equity *
19.23
20.93
18.66
16.48
14.20
503
Weighted average common shares
outstanding, basic
145,799
145,467
145,386
145,328
145,273
—
%
Weighted average common shares
outstanding, diluted
146,727
146,528
146,418
146,315
146,665
—
nm - not meaningful
bps - basis points
* - ratios are annualized
Synovus
BALANCE SHEET DATA
March 31, 2023
December 31, 2022
March 31, 2022
(Unaudited)
(In thousands, except share data)
ASSETS
Cash and due from banks
$
638,150
$
624,097
$
557,178
Interest-bearing funds with Federal
Reserve Bank
2,656,953
1,280,684
941,272
Interest earning deposits with banks
34,779
34,632
27,411
Federal funds sold and securities
purchased under resale agreements
35,518
38,367
27,642
Cash, cash equivalents, and restricted
cash
3,365,400
1,977,780
1,553,503
Investment securities available for sale,
at fair value
9,732,618
9,678,103
10,463,101
Loans held for sale (includes $44,400,
$51,136 and $111,992 measured at fair value, respectively)
669,447
391,502
723,921
Loans, net of deferred fees and costs
44,044,939
43,716,353
40,169,150
Allowance for loan losses
(457,010
)
(443,424
)
(414,956
)
Loans, net
43,587,929
43,272,929
39,754,194
Cash surrender value of bank-owned life
insurance
1,094,072
1,089,280
1,075,175
Premises, equipment, and software, net
367,089
370,632
386,631
Goodwill
452,390
452,390
452,390
Other intangible assets, net
25,267
27,124
33,478
Other assets
2,545,813
2,471,638
1,977,156
Total assets
$
61,840,025
$
59,731,378
$
56,419,549
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Deposits:
Non-interest-bearing deposits
$
14,642,677
$
15,639,899
$
16,611,344
Interest-bearing deposits
35,311,259
33,231,660
32,044,900
Total deposits
49,953,936
48,871,559
48,656,244
Federal funds purchased and securities
sold under repurchase agreements
195,695
146,588
501,124
Other short-term borrowings
253,152
603,384
400,389
Long-term debt
5,146,252
4,109,597
805,259
Other liabilities
1,520,860
1,524,449
1,231,898
Total liabilities
57,069,895
55,255,577
51,594,914
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 170,713,864, 170,141,492 and 169,912,021
respectively; outstanding 146,059,006, 145,486,634 and 145,334,763
respectively
170,714
170,141
169,912
Additional paid-in capital
3,925,449
3,920,346
3,899,269
Treasury stock, at cost; 24,654,858,
24,654,858, and 24,577,258 shares, respectively
(944,484
)
(944,484
)
(941,168
)
Accumulated other comprehensive income
(loss), net
(1,289,327
)
(1,442,117
)
(662,065
)
Retained earnings
2,370,633
2,234,770
1,821,542
Total shareholders’ equity
4,770,130
4,475,801
4,824,635
Total liabilities and shareholders'
equity
$
61,840,025
$
59,731,378
$
56,419,549
Synovus
AVERAGE BALANCES, INTEREST, AND
YIELDS/RATES
(Unaudited)
First Quarter 2023
Fourth Quarter 2022
First Quarter 2022
(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)
$
35,030,809
$
526,529
6.10
%
$
34,103,384
$
474,439
5.52
%
$
30,756,752
$
280,588
3.70
%
Consumer loans (1) (2)
8,762,631
104,147
4.78
9,041,520
101,905
4.50
8,594,009
81,368
3.81
Less: Allowance for loan losses
(445,192
)
—
—
(427,525
)
—
—
(423,953
)
—
—
Loans, net
43,348,248
630,676
5.89
42,717,379
576,344
5.36
38,926,808
361,956
3.76
Investment securities available for
sale
11,293,958
61,054
2.16
11,296,449
58,840
2.08
11,259,800
47,250
1.68
Trading account assets
11,338
124
4.39
15,552
68
1.75
9,078
39
1.73
Other earning assets(4)
1,513,800
17,212
4.55
1,148,099
10,490
3.58
1,919,531
815
0.17
FHLB and Federal Reserve Bank stock
306,935
3,355
4.37
270,822
2,805
4.14
160,065
685
1.71
Mortgage loans held for sale
36,497
566
6.20
46,240
688
5.95
103,887
882
3.40
Other loans held for sale
443,690
5,011
4.52
514,811
6,550
4.98
597,062
5,300
3.55
Total interest earning assets
56,954,466
$
717,998
5.11
%
56,009,352
$
655,785
4.65
%
52,976,231
$
416,927
3.19
%
Cash and due from banks
643,502
651,189
548,684
Premises and equipment
370,275
375,352
398,774
Other real estate
—
—
11,759
Cash surrender value of bank-owned life
insurance
1,091,080
1,085,394
1,070,886
Other assets(5)
1,074,238
842,130
1,849,564
Total assets
$
60,133,561
$
58,963,417
$
56,855,898
Liabilities and Shareholders'
Equity
Interest-bearing liabilities:
Interest-bearing demand deposits
$
9,088,533
$
23,218
1.04
%
$
8,627,386
$
14,160
0.65
%
$
9,549,527
$
2,372
0.10
%
Money market accounts
14,397,683
72,618
2.05
14,771,308
46,671
1.25
16,045,627
5,349
0.14
Savings deposits
1,370,173
211
0.06
1,450,153
176
0.05
1,460,648
67
0.02
Time deposits
3,601,288
21,496
2.42
2,567,979
7,648
1.18
3,009,795
2,138
0.29
Brokered deposits
5,553,970
56,392
4.12
4,986,542
39,500
3.14
2,788,124
3,733
0.54
Federal funds purchased and securities
sold under repurchase agreements
133,360
670
2.01
141,707
437
1.21
194,352
11
0.02
Other short-term borrowings
1,677,519
18,994
4.53
660,295
6,383
3.78
4,773
—
—
Long-term debt
3,148,062
42,529
5.41
3,446,306
38,333
4.39
982,423
10,144
4.13
Total interest-bearing liabilities
38,970,588
$
236,128
2.46
%
36,651,676
$
153,308
1.66
%
34,035,269
$
23,814
0.28
%
Non-interest-bearing demand deposits
15,014,224
16,569,275
16,491,643
Other liabilities
1,522,827
1,462,394
1,144,415
Shareholders' equity
4,625,922
4,280,072
5,184,571
Total liabilities and shareholders'
equity
$
60,133,561
$
58,963,417
$
56,855,898
Net interest income and net interest
margin, taxable equivalent (6) (7)
$
481,870
3.43
%
$
502,477
3.56
%
$
393,113
3.01
%
Less: taxable-equivalent adjustment
1,119
1,131
865
Net interest income
$
480,751
$
501,346
$
392,248
(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 2023 — $11.5 million, Fourth Quarter 2022 —
$11.7 million, and First Quarter 2022 — $20.7 million.
(3)
Reflects taxable-equivalent adjustments,
using the statutory federal tax rate of 21%, in adjusting interest
on tax-exempt loans 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
$(1.52) billion, $(1.69) billion, and $(247.4) million for the
First Quarter 2023, Fourth Quarter 2022, and First Quarter 2022,
respectively.
(6)
The net interest margin is calculated by
dividing annualized net interest income-taxable equivalent by
average total interest earning assets.
(7)
Net interest margin reflects Actual/Actual
day count and includes other immaterial adjustments versus NIM
previously reported.
Synovus
LOANS OUTSTANDING BY TYPE
(Unaudited)
Total Loans
Total Loans
Linked Quarter
Total Loans
Year/Year
(Dollars in thousands)
Loan Type
March 31, 2023
December 31, 2022
% Change
March 31, 2022
% Change
Commercial, Financial, and
Agricultural
$
14,201,398
$
13,874,416
2
%
$
12,659,611
12
%
Owner-Occupied
8,398,778
8,192,240
3
7,692,714
9
Total Commercial &
Industrial
22,600,176
22,066,656
2
20,352,325
11
Multi-Family
3,374,129
3,134,571
8
2,288,497
47
Hotels
1,737,163
1,708,194
2
1,593,983
9
Office Buildings
3,071,236
3,011,911
2
2,521,381
22
Shopping Centers
1,332,078
1,403,928
(5
)
1,500,768
(11
)
Warehouses
1,020,921
1,035,152
(1
)
814,756
25
Other Investment Property
1,441,303
1,350,291
7
1,327,760
9
Total Investment Properties
11,976,830
11,644,047
3
10,047,145
19
1-4 Family Construction
201,896
229,263
(12
)
229,038
(12
)
1-4 Family Investment Mortgage
394,754
387,670
2
391,636
1
Total 1-4 Family Properties
596,650
616,933
(3
)
620,674
(4
)
Commercial Development
63,004
79,889
(21
)
102,757
(39
)
Residential Development
106,872
108,661
(2
)
193,580
(45
)
Land Acquisition
253,399
200,783
26
181,162
40
Land and Development
423,275
389,333
9
477,499
(11
)
Total Commercial Real Estate
12,996,755
12,650,313
3
11,145,318
17
Consumer Mortgages
5,246,640
5,214,443
1
5,052,003
4
Home Equity
1,757,250
1,757,038
—
1,416,341
24
Credit Cards
184,595
203,612
(9
)
188,247
(2
)
Other Consumer Loans
1,259,523
1,824,291
(31
)
2,014,916
(37
)
Total Consumer
8,448,008
8,999,384
(6
)
8,671,507
(3
)
Total
$
44,044,939
$
43,716,353
1
%
$
40,169,150
10
%
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, 2023
December 31, 2022
% Change
March 31, 2022
% Change
Commercial, Financial, and
Agricultural
$
94,196
$
59,307
59
%
$
64,888
45
%
Owner-Occupied
25,591
10,104
153
10,854
136
Total Commercial &
Industrial
119,787
69,411
73
75,742
58
Multi-Family
1,806
1,857
(3
)
2,639
(32
)
Office Buildings
190
309
(39
)
2,205
(91
)
Shopping Centers
727
735
(1
)
915
(21
)
Warehouses
222
223
—
482
(54
)
Other Investment Property
668
349
91
1,047
(36
)
Total Investment Properties
3,613
3,473
4
7,288
(50
)
1-4 Family Construction
—
55
(100
)
55
(100
)
1-4 Family Investment Mortgage
3,515
3,067
15
2,187
61
Total 1-4 Family Properties
3,515
3,122
13
2,242
57
Commercial Development
—
—
nm
625
(100
)
Residential Development
267
267
—
407
(34
)
Land Acquisition
886
891
(1
)
1,021
(13
)
Land and Development
1,153
1,158
—
2,053
(44
)
Total Commercial Real Estate
8,281
7,753
7
11,583
(29
)
Consumer Mortgages
39,536
36,847
7
29,997
32
Home Equity
7,967
6,830
17
8,854
(10
)
Other Consumer Loans
6,889
7,220
(5
)
5,955
16
Total Consumer
54,392
50,897
7
44,806
21
Total
$
182,460
$
128,061
42
%
$
132,131
38
%
Synovus
CREDIT QUALITY DATA
(Unaudited)
(Dollars in thousands)
2023
2022
First Quarter
First
Fourth
Third
Second
First
'23 vs '22
Quarter
Quarter
Quarter
Quarter
Quarter
% Change
Non-performing Loans (NPLs)
$
182,460
128,061
122,094
109,024
132,131
38
%
Impaired Loans Held for Sale
—
—
447
—
—
nm
Other Real Estate and Other Assets
—
15,320
15,320
26,759
26,759
(100
)
Non-performing Assets (NPAs)
182,460
143,381
137,861
135,783
158,890
15
Allowance for Loan Losses (ALL)
457,010
443,424
421,359
407,837
414,956
10
Reserve for Unfunded Commitments
57,473
57,455
57,936
50,559
47,317
21
Allowance for Credit Losses (ACL)
514,483
500,879
479,295
458,396
462,273
11
Net Charge-Offs - Quarter
18,550
13,300
4,682
16,565
18,609
Net Charge-Offs - YTD
18,550
53,156
39,856
35,174
18,609
Net Charge-Offs / Average Loans - Quarter
(1)
0.17
%
0.12
0.04
0.16
0.19
Net Charge-Offs / Average Loans - YTD
(1)
0.17
0.13
0.13
0.18
0.19
NPLs / Loans
0.41
0.29
0.29
0.26
0.33
NPAs / Loans, ORE and specific other
assets
0.41
0.33
0.32
0.33
0.40
ACL/Loans
1.17
1.15
1.13
1.11
1.15
ALL/Loans
1.04
1.01
0.99
0.99
1.03
ACL/NPLs
281.97
391.13
392.56
420.45
349.86
ALL/NPLs
250.47
346.26
345.11
374.08
314.05
Past Due Loans over 90 days and Still
Accruing
$
3,529
3,373
3,443
2,251
3,067
15
As a Percentage of Loans Outstanding
0.01
%
0.01
0.01
0.01
0.01
Total Past Due Loans and Still
Accruing
$
55,053
65,568
63,545
56,160
45,385
21
As a Percentage of Loans Outstanding
0.12
%
0.15
0.15
0.14
0.11
(1) Ratio is annualized.
SELECTED CAPITAL INFORMATION
(1)
(Unaudited)
(Dollars in thousands)
March 31, 2023
December 31, 2022
March 31, 2022
Common Equity Tier 1 Capital Ratio
9.76
%
9.63
9.49
Tier 1 Capital Ratio
10.79
10.68
10.63
Total Risk-Based Capital Ratio
12.69
12.54
12.56
Tier 1 Leverage Ratio
9.14
9.07
8.87
Total Shareholders' Equity as a Percentage
of Total Assets
7.71
7.49
8.55
Tangible Common Equity Ratio (2) (4)
6.12
5.84
6.80
Book Value Per Common Share (3)
$
28.98
27.07
29.50
Tangible Book Value Per Common Share
(2)
25.71
23.78
26.16
(1) Current quarter regulatory capital
information is preliminary.
(2) Excludes the carrying value of
goodwill and other intangible assets from common equity and total
assets.
(3) Book Value Per Common Share consists
of Total Shareholders' Equity less Preferred Stock divided by total
common shares outstanding.
(4) See "Non-GAAP Financial Measures" for
applicable reconciliation.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20230418006271/en/
Media Contact Audria Belton Media Relations
media@synovus.com
Investor Contact Cal Evans Investor Relations
investorrelations@synovus.com
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