Wintrust Financial Corporation ("Wintrust" or "the Company")
(Nasdaq:WTFC) announced net income of $39.1 million or $0.76 per
diluted common share for the first quarter of 2015 compared to net
income of $38.1 million or $0.75 per diluted common share for the
fourth quarter of 2014 and $34.5 million or $0.68 per diluted
common share for the first quarter of 2014.
Highlights compared with the Fourth Quarter of
2014*:
- Total loans, excluding covered loans and mortgage loans
held-for-sale, increased by $544 million, or 15% on annualized
basis, to $15.0 billion
- Total deposits increased by $657 million, or 16% on an
annualized basis, to $16.9 billion
- Mortgage banking revenue increased by $3.1 million to $27.8
million
- Net charge-offs declined to $3.1 million from $5.9 million
- Recorded acquisition-related expenses totaling $738,000
- Increased the quarterly cash dividend to $0.11 per share of
outstanding common stock from $0.10 per share
- Completed the acquisition of Delavan Bancshares, adding four
banking facilities in southern Wisconsin
- Opened four new banking locations including a location at the
231 South LaSalle building in downtown Chicago as well as locations
in Arlington Heights, Glenview and Mundelein
- Announced agreements to acquire Community Financial Shares,
North Bank and Suburban Illinois Bancorp.
* See "Supplemental Financial Measures/Ratios" on page 13/14 for
more information on non-GAAP measures.
Edward J. Wehmer, President and Chief Executive Officer,
commented, "Wintrust reported strong net income for the first
quarter of 2015, an increase of 13% as compared to net income of
$34.5 million in the first quarter of 2014. The current quarter was
highlighted by strong loan and deposit growth, strong mortgage
banking results, relatively stable net interest margin and credit
quality metrics and the acquisition of Delavan Bancshares."
Mr. Wehmer continued, "The Company grew total loans, excluding
covered loans and mortgage loans held-for-sale, by $544 million in
the first quarter, which included $128 million of loans acquired
through the Delavan Bancshares transaction. Our existing commercial
and commercial real-estate portfolios exhibited strong growth,
increasing by $380 million during the quarter. The increase in loan
volume during the quarter was funded by excess liquidity and growth
in deposits of $657 million, including $170 million from the
Delavan Bancshares acquisition. Non-interest bearing deposits
increased $261 million and now comprise 22% of our total deposits.
By utilizing our liquidity and improving our deposit mix we
partially offset the reduction in yield on our non-covered loan
portfolios, which resulted in the net interest margin declining by
only four basis points during the quarter to 3.42%."
Commenting on credit quality, Mr. Wehmer noted, "The Company has
continued its practice of timely addressing and resolving
non-performing credits. Overall, credit quality metrics remained
stable in the current quarter, continuing to rival the pre-credit
crisis levels experienced between 2005 and 2008. Specifically, the
allowance for loan losses as a percentage of non-performing loans
remained steady during the quarter, ending at 116%. We believe that
the Company's reserves remain appropriate."
Mr. Wehmer further commented, "Our mortgage banking business
continued its positive momentum in the first quarter resulting in
an increase in mortgage banking revenue of $3.1 million as compared
to the fourth quarter of 2014. The increase in mortgage banking
revenue was primarily a result of higher origination volumes in the
current quarter as purchase originations were supplemented by
increased refinancing activity amidst the low interest rate
environment. Our mortgage pipeline remains strong and we expect to
continue to pick up refinance business as well as financing home
purchases as we enter into the traditional spring purchase market.
We believe that our mortgage banking business remains well
positioned to grow both organically and through acquisitions."
Turning to the future, Mr. Wehmer stated, "We expanded our
franchise in the first quarter through the acquisition of Delavan
Bancshares and its four banking locations in southern Wisconsin. We
opened an additional four new banking locations, including one in
the historic 231 South LaSalle building in downtown Chicago,
bringing the number of Wintrust banking locations to 146. Also, we
recently signed agreements to acquire Community Financial Shares,
North Bank and Suburban Illinois Bancorp. These acquisitions will
not only provide Wintrust with an expanded customer base, but many
of them present opportunities to reduce the combined overhead cost
structure primarily as a result of eliminating overlapping branch
facilities. Evaluating strategic acquisitions of this nature and
organic branch growth will continue to be a part of our overall
growth strategy with the goal of becoming Chicago's bank. Our
pipelines for both internal growth and external growth remain
consistently strong. We continue to take a steady and measured
approach to achieve our main objectives of growing franchise value,
increasing profitability, leveraging our expense infrastructure and
increasing shareholder value."
Graphs accompanying this release are available at
http://media.globenewswire.com/cache/11955/file/33267.pdf
Wintrust's key operating measures and growth rates for the first
quarter of 2015, as compared to the sequential and linked quarters,
are shown in the table below:
|
Three Months
Ended |
% or(5)
basis point (bp) change
from |
% or
basis point (bp) change
from |
(Dollars in thousands) |
March 31,
2015 |
December 31, 2014 |
March 31, 2014 |
4th Quarter
2014 |
1st Quarter
2014 |
Net income |
$39,052 |
$38,133 |
$34,500 |
2% |
13% |
Net income per common share – diluted |
$0.76 |
$0.75 |
$0.68 |
1% |
12% |
Net revenue (1) |
$216,432 |
$211,376 |
$189,535 |
2% |
14% |
Net interest income |
$151,891 |
$153,719 |
$144,006 |
(1)% |
5% |
Net interest margin (2) |
3.42% |
3.46% |
3.61% |
(4) bp |
(19) bp |
Net overhead ratio (2) (3) |
1.69% |
1.76% |
1.93% |
(7) bp |
(24) bp |
Efficiency ratio (2) (4) |
67.90% |
67.59% |
69.02% |
31 bp |
(112) bp |
Return on average assets |
0.80% |
0.78% |
0.78% |
2 bp |
2 bp |
Return on average common equity |
7.64% |
7.51% |
7.43% |
13 bp |
21 bp |
Return on average tangible common
equity |
9.96% |
9.82% |
9.71% |
14 bp |
25 bp |
At end of period |
|
|
|
|
|
Total assets |
$20,382,271 |
$20,010,727 |
$18,221,163 |
8% |
12% |
Total loans, excluding loans held-for-sale,
excluding covered loans |
$14,953,059 |
$14,409,398 |
$13,133,160 |
15% |
14% |
Total loans, including loans held-for-sale,
excluding covered loans |
$15,399,414 |
$14,760,688 |
$13,348,391 |
18% |
15% |
Total deposits |
$16,938,769 |
$16,281,844 |
$15,129,045 |
16% |
12% |
Total shareholders'
equity |
$2,131,074 |
$2,069,822 |
$1,940,143 |
12% |
10% |
|
(1) Net
revenue is net interest income plus non-interest income. |
(2) See
"Supplemental Financial Measures/Ratios" for additional information
on this performance measure/ratio. |
(3) The net
overhead ratio is calculated by netting total non-interest expense
and total non-interest income, annualizing this amount, and
dividing by that period's average total assets. A lower ratio
indicates a higher degree of efficiency. |
(4) The
efficiency ratio is calculated by dividing total non-interest
expense by tax-equivalent net revenue (less securities gains or
losses). A lower ratio indicates more efficient revenue
generation. |
(5) Period-end
balance sheet percentage changes are annualized. |
Certain returns, yields, performance ratios, or quarterly growth
rates are "annualized" in this presentation to represent an annual
time period. This is done for analytical purposes to better discern
for decision-making purposes underlying performance trends when
compared to full-year or year-over-year amounts. For example, a 5%
growth rate for a quarter would represent an annualized 20% growth
rate. Additional supplemental financial information showing
quarterly trends can be found on the Company's web site at
www.wintrust.com by choosing "Financial Reports" under the
"Investor Relations" heading, and then choosing "Financial
Highlights."
Financial Performance Overview – First Quarter
2015
For the first quarter of 2015, net interest income totaled
$151.9 million, a decrease of $1.8 million as compared to the
fourth quarter of 2014 and an increase of $7.9 million as compared
to the first quarter of 2014. The changes in net interest
income on both a sequential and linked quarter basis are the result
of the following:
- Net interest income decreased $1.8 million in the first quarter
of 2015 compared to the fourth quarter of 2014, due to:
- A decrease in total interest income of $2.4 million in the
first quarter of 2015 compared to the fourth quarter of 2014
resulting primarily from a reduction in yield on the purchased
non-covered loan portfolios and two fewer days in the quarter,
partially offset by loan growth during the
period.
- Interest expense in the first quarter of 2015 compared to the
fourth quarter of 2014 decreased $530,000 primarily as a result of
two fewer days in the quarter and a one basis point decline in the
rate on average interest bearing liabilities, partially offset by
an increase in interest bearing deposits and the completion of the
Canadian secured borrowing transaction at the end of the fourth
quarter of 2014.
- Net interest income increased $7.9 million in the first quarter
of 2015 compared to the first quarter of 2014, due to:
- Average loans, excluding covered loans, for the first quarter
of 2015 increased by $1.8 billion compared to the first quarter of
2014. The growth in average loans, excluding covered loans,
was partially offset by a 21 basis point decline in the yield on
earning assets, resulting in an increase in total interest income
of $9.0 million in the first quarter of 2015 compared to the prior
year quarter.
- An increase in interest bearing deposits, the issuance of
subordinated notes at the end of the second quarter of 2014 and the
completion of the Canadian secured borrowing transaction at the end
of the fourth quarter of 2014 was partially offset by a more
favorable funding mix, resulting in a $1.1 million increase in
interest expense.
- Combined, the increase in interest income of $9.0 million and
the increase in interest expense of $1.1 million created the $7.9
million increase in net interest income in the first quarter of
2015 compared to the first quarter of 2014.
The net interest margin, on a fully taxable equivalent basis,
for the first quarter of 2015 was 3.42% compared to 3.46% for the
fourth quarter of 2014 and 3.61% for the first quarter of
2014. The reduction in net interest margin, on a fully taxable
equivalent basis, compared to the first quarter of 2014 is
primarily the result of a decline in loan yields (see "Net Interest
Income" section later in this release for further detail).
Non-interest income totaled $64.5 million in the first quarter of
2015, increasing $6.9 million, or 12%, compared to the fourth
quarter of 2014 and increasing $19.0 million, or 42%, compared to
the first quarter of 2014. The increase in non-interest income in
the first quarter of 2015 compared to the fourth quarter of 2014 is
primarily attributable to higher mortgage banking revenue,
increased fees from covered call options and an increase in
interest rate swap fees, partially offset by slightly lower wealth
management revenues. The increase in non-interest income in
the first quarter of 2015 compared to the first quarter of 2014 was
primarily attributable to an increase in wealth management and
mortgage banking revenues, fees from covered call options and
higher interest rate swap fees (see "Non-Interest Income" section
later in this release for further detail). Non-interest
expense totaled $147.3 million in the first quarter of 2015,
increasing $3.9 million, or 3%, compared to the fourth quarter of
2014 and increasing $16.0 million, or 12%, compared to the first
quarter of 2014. The increase in the current quarter compared
to the fourth quarter of 2014 can be primarily attributed to higher
salary and employee benefit costs from increased salaries caused by
the addition of employees from the various acquisitions and larger
staffing as the Company grows as well as an increase in payroll
taxes, increased equipment and occupancy expenses and higher
professional fees, partially offset by a decrease in OREO
expenses. The increase in the first quarter of 2015 compared
to the first quarter of 2014 was primarily attributable to higher
salary and employee benefit costs and increased occupancy,
equipment, professional fees and marketing expenses, partially
offset by a decrease in OREO expenses (see "Non-Interest Expense"
section later in this release for further detail).
Financial Performance Overview – Credit Quality
The ratio of non-performing assets to total assets was 0.61% as of
March 31, 2015, compared to 0.62% at December 31, 2014,
and 0.79% at March 31, 2014. Non-performing assets,
excluding covered assets, totaled $124.3 million at March 31,
2015, compared to $124.6 million at December 31, 2014 and
$144.7 million at March 31, 2014. Non-performing loans,
excluding covered loans, totaled $81.8 million, or 0.55% of total
loans, at March 31, 2015, compared to $78.7 million, or 0.55%
of total loans, at December 31, 2014 and $90.1 million, or
0.69% of total loans, at March 31, 2014. The decrease in
non-performing loans, excluding covered loans, compared to
March 31, 2014 is primarily the result of a $6.6 million
decrease in the commercial loan portfolio and a $3.8 million
decrease in the commercial real-estate loan portfolio. OREO,
excluding covered OREO, of $42.3 million at March 31, 2015
decreased $3.3 million compared to $45.6 million at
December 31, 2014 and decreased $11.8 million compared to
$54.1 million at March 31, 2014. The provision for credit
losses, excluding the provision for covered loan losses, totaled
$6.2 million for the first quarter of 2015 compared to $6.7 million
for the fourth quarter of 2014 and $3.3 million for the first
quarter of 2014. The lower provision for credit losses in the first
quarter of 2014 was primarily due to a reduction recorded in the
provision associated with general reserves during that period. The
reduction at that time was driven by improvement in credit quality
metrics compared to periods prior to the first quarter of 2014,
including historical charge-off rates and lower levels of
non-performing and adversely classified loans. Credit quality
metrics remained relatively stable in the first quarter of 2015
compared to the same period of the prior year. Net charge-offs as a
percentage of loans, excluding covered loans, for the first quarter
of 2015 totaled eight basis points on an annualized basis compared
to 16 basis points on an annualized basis in the fourth quarter of
2014 and 24 basis points on an annualized basis in the first
quarter of 2014. Net charge-offs totaled $3.1 million in the
first quarter of 2015, a $2.8 million decrease from $5.9 million in
the fourth quarter of 2014 and a $4.7 million decrease from $7.8
million in the first quarter of 2014. Compared to the first quarter
of 2014, net charge-offs decreased primarily as a result of a $3.7
million and $1.5 million decrease in net charge-offs within
the commercial real-estate and home equity loan portfolios,
respectively. Excluding the allowance for covered loan losses, the
allowance for credit losses at March 31, 2015 totaled $95.3
million, or 0.64% of total loans, compared to $92.5 million, or
0.64% of total loans, at December 31, 2014 and $93.0 million,
or 0.71% of total loans, at March 31, 2014. The allowance
for unfunded lending-related commitments totaled $888,000 as of
March 31, 2015 compared to $775,000 as of December 31,
2014 and $737,000 as of March 31, 2014. Financial
Performance Overview – Earnings Per Share The following
table shows the computation of basic and diluted earnings per share
for the periods indicated:
|
|
Three Months
Ended |
(In thousands, except per share data) |
|
March 31,
2015 |
December 31, 2014 |
March 31, 2014 |
Net income |
|
$39,052 |
$38,133 |
$34,500 |
Less: Preferred stock dividends and discount
accretion |
|
1,581 |
1,580 |
1,581 |
Net income applicable to common
shares—Basic |
(A) |
37,471 |
36,553 |
32,919 |
Add: Dividends on convertible preferred
stock, if dilutive |
|
1,581 |
1,580 |
1,581 |
Net income applicable to common
shares—Diluted |
(B) |
39,052 |
38,133 |
34,500 |
Weighted average common shares
outstanding |
(C) |
47,239 |
46,734 |
46,195 |
Effect of dilutive potential common
shares: |
|
|
|
|
Common stock equivalents |
|
1,158 |
1,168 |
1,434 |
Convertible preferred stock, if
dilutive |
|
3,075 |
3,075 |
3,075 |
Weighted average common shares and effect of
dilutive potential common shares |
(D) |
51,472 |
50,977 |
50,704 |
Net income per common share: |
|
|
|
|
Basic |
(A/C) |
$0.79 |
$0.78 |
$0.71 |
Diluted |
(B/D) |
$0.76 |
$0.75 |
$0.68 |
Potentially dilutive common shares can result from stock
options, restricted stock unit awards, stock warrants, the
Company's convertible preferred stock and shares to be issued under
the Employee Stock Purchase Plan and the Directors Deferred Fee and
Stock Plan, being treated as if they had been either exercised or
issued, computed by application of the treasury stock method. While
potentially dilutive common shares are typically included in the
computation of diluted earnings per share, potentially dilutive
common shares are excluded from this computation in periods in
which the effect would reduce the loss per share or increase the
income per share. For diluted earnings per share, net income
applicable to common shares can be affected by the conversion of
the Company's convertible preferred stock. Where the effect of this
conversion would reduce the loss per share or increase the income
per share, net income applicable to common shares is not adjusted
by the associated preferred dividends.
WINTRUST FINANCIAL
CORPORATION |
Selected Financial
Highlights |
|
|
Three Months
Ended |
(Dollars in thousands, except per share
data) |
March 31,
2015 |
December 31, 2014 |
March 31, 2014 |
Selected Financial Condition Data (at
end of period): |
|
|
|
Total assets |
$20,382,271 |
$20,010,727 |
$18,221,163 |
Total loans, excluding loans held-for-sale
and covered loans |
14,953,059 |
14,409,398 |
13,133,160 |
Total deposits |
16,938,769 |
16,281,844 |
15,129,045 |
Junior subordinated debentures |
249,493 |
249,493 |
249,493 |
Total shareholders' equity |
2,131,074 |
2,069,822 |
1,940,143 |
Selected Statements of Income
Data: |
|
|
|
Net interest income |
$151,891 |
$153,719 |
$144,006 |
Net revenue (1) |
216,432 |
211,376 |
189,535 |
Net income |
39,052 |
38,133 |
34,500 |
Net income per common share – Basic |
$0.79 |
$0.78 |
$0.71 |
Net income per common share – Diluted |
$0.76 |
$0.75 |
$0.68 |
Selected Financial Ratios and Other
Data: |
|
|
|
Performance Ratios: |
|
|
|
Net interest margin (2) |
3.42% |
3.46% |
3.61% |
Non-interest income to average assets |
1.32% |
1.18% |
1.03% |
Non-interest expense to average assets |
3.01% |
2.94% |
2.96% |
Net overhead ratio (2) (3) |
1.69% |
1.76% |
1.93% |
Efficiency ratio (2) (4) |
67.90% |
67.59% |
69.02% |
Return on average assets |
0.80% |
0.78% |
0.78% |
Return on average common equity |
7.64% |
7.51% |
7.43% |
Return on average tangible common equity
(2) |
9.96% |
9.82% |
9.71% |
Average total assets |
$19,826,240 |
$19,366,670 |
$17,980,943 |
Average total shareholders' equity |
2,114,356 |
2,057,855 |
1,923,649 |
Average loans to average deposits ratio
(excluding covered loans) |
91.4% |
89.5% |
89.4% |
Average loans to average deposits ratio
(including covered loans) |
92.7% |
91.0% |
91.6% |
Common Share Data at end of period: |
|
|
|
Market price per common share |
$47.68 |
$46.76 |
$48.66 |
Book value per common share (2) |
$42.30 |
$41.52 |
$39.21 |
Tangible common book value per share (2) |
$33.04 |
$32.45 |
$30.74 |
Common shares outstanding |
47,389,608 |
46,805,055 |
46,258,960 |
Other Data at end of period:(8) |
|
|
|
Leverage Ratio (5) |
9.2% |
10.2% |
10.4% |
Tier 1 capital to risk-weighted assets
(5) |
10.1% |
11.6% |
12.0% |
Common equity Tier 1 capital to risk-weighted
assets (5) |
9.0% |
N/A |
N/A |
Total capital to risk-weighted assets
(5) |
12.5% |
13.0% |
12.6% |
Tangible common equity ratio (TCE)
(2)(7) |
7.9% |
7.8% |
8.0% |
Tangible common equity ratio, assuming full
conversion of preferred stock (2) (7) |
8.5% |
8.4% |
8.7% |
Allowance for credit losses (6) |
$95,334 |
$92,480 |
$93,012 |
Non-performing loans |
$81,772 |
$78,677 |
$90,124 |
Allowance for credit losses to total loans
(6) |
0.64% |
0.64% |
0.71% |
Non-performing loans to total loans |
0.55% |
0.55% |
0.69% |
Number of: |
|
|
|
Bank
subsidiaries |
15 |
15 |
15 |
Banking
offices |
146 |
140 |
126 |
|
|
|
|
(1) Net
revenue includes net interest income and non-interest income. |
(2) See
"Supplemental Financial Measures/Ratios" for additional information
on this performance measure/ratio. |
(3) The net
overhead ratio is calculated by netting total non-interest expense
and total non-interest income, annualizing this amount, and
dividing by that period's total average assets. A lower ratio
indicates a higher degree of efficiency. |
(4) The
efficiency ratio is calculated by dividing total non-interest
expense by tax-equivalent net revenue (less securities gains or
losses). A lower ratio indicates more efficient revenue
generation. |
(5) Capital
ratios for current quarter-end are estimated. As of January 1,
2015 capital ratios are calculated under the requirements of Basel
III. |
(6) The
allowance for credit losses includes both the allowance for loan
losses and the allowance for unfunded lending-related commitments,
but excludes the allowance for covered loan losses. |
(7) Total
shareholders' equity minus preferred stock and total intangible
assets divided by total assets minus total intangible assets. |
(8) Asset
quality ratios exclude covered loans. |
WINTRUST FINANCIAL
CORPORATION AND SUBSIDIARIES |
CONSOLIDATED STATEMENTS
OF CONDITION |
|
|
|
|
(In thousands) |
(Unaudited)
March 31, 2015 |
December 31, 2014 |
(Unaudited) March 31, 2014 |
Assets |
|
|
|
Cash and due from banks |
$286,743 |
$225,136 |
$330,262 |
Federal funds sold and securities purchased
under resale agreements |
4,129 |
5,571 |
12,476 |
Interest bearing deposits with banks |
697,799 |
998,437 |
540,964 |
Available-for-sale securities, at fair
value |
1,721,030 |
1,792,078 |
1,949,697 |
Trading account securities |
7,811 |
1,206 |
1,068 |
Federal Home Loan Bank and Federal Reserve
Bank stock |
92,948 |
91,582 |
78,524 |
Brokerage customer receivables |
25,287 |
24,221 |
26,884 |
Mortgage loans held-for-sale |
446,355 |
351,290 |
215,231 |
Loans, net of unearned income, excluding
covered loans |
14,953,059 |
14,409,398 |
13,133,160 |
Covered loans |
209,694 |
226,709 |
312,478 |
Total loans |
15,162,753 |
14,636,107 |
13,445,638 |
Less: Allowance for loan
losses |
94,446 |
91,705 |
92,275 |
Less: Allowance for covered
loan losses |
1,878 |
2,131 |
3,447 |
Net loans |
15,066,429 |
14,542,271 |
13,349,916 |
Premises and equipment, net |
559,281 |
555,228 |
531,763 |
FDIC indemnification asset |
10,224 |
11,846 |
60,298 |
Accrued interest receivable and other
assets |
537,117 |
501,882 |
549,705 |
Trade date securities receivable |
488,063 |
485,534 |
182,600 |
Goodwill |
420,197 |
405,634 |
373,725 |
Other intangible assets |
18,858 |
18,811 |
18,050 |
Total
assets |
$20,382,271 |
$20,010,727 |
$18,221,163 |
Liabilities and Shareholders'
Equity |
|
|
|
Deposits: |
|
|
|
Non-interest bearing |
$3,779,609 |
$3,518,685 |
$2,773,922 |
Interest bearing |
13,159,160 |
12,763,159 |
12,355,123 |
Total deposits |
16,938,769 |
16,281,844 |
15,129,045 |
Federal Home Loan Bank advances |
416,036 |
733,050 |
387,672 |
Other borrowings |
187,006 |
196,465 |
231,086 |
Subordinated notes |
140,000 |
140,000 |
— |
Junior subordinated debentures |
249,493 |
249,493 |
249,493 |
Trade date securities payable |
2,929 |
3,828 |
— |
Accrued interest payable and other
liabilities |
316,964 |
336,225 |
283,724 |
Total liabilities |
18,251,197 |
17,940,905 |
16,281,020 |
Shareholders' Equity: |
|
|
|
Preferred stock |
126,427 |
126,467 |
126,477 |
Common stock |
47,475 |
46,881 |
46,332 |
Surplus |
1,156,542 |
1,133,955 |
1,122,233 |
Treasury stock |
(3,948) |
(3,549) |
(3,380) |
Retained earnings |
835,669 |
803,400 |
705,234 |
Accumulated other comprehensive
loss |
(31,091) |
(37,332) |
(56,753) |
Total shareholders' equity |
2,131,074 |
2,069,822 |
1,940,143 |
Total liabilities and
shareholders' equity |
$20,382,271 |
$20,010,727 |
$18,221,163 |
WINTRUST FINANCIAL
CORPORATION AND SUBSIDIARIES |
CONSOLIDATED STATEMENTS
OF INCOME (UNAUDITED) |
|
Three Months
Ended |
(In thousands, except per share data) |
March 31,
2015 |
December 31, 2014 |
March 31, 2014 |
Interest income |
|
|
|
Interest and fees on loans |
$154,676 |
$157,476 |
$147,030 |
Interest bearing deposits with
banks |
316 |
495 |
249 |
Federal funds sold and
securities purchased under resale agreements |
2 |
3 |
4 |
Available-for-sale
securities |
14,400 |
13,761 |
13,114 |
Trading account securities |
13 |
45 |
9 |
Federal Home Loan Bank and
Federal Reserve Bank stock |
769 |
749 |
711 |
Brokerage customer
receivables |
181 |
186 |
209 |
Total interest income |
170,357 |
172,715 |
161,326 |
Interest expense |
|
|
|
Interest on deposits |
11,814 |
12,431 |
11,923 |
Interest on Federal Home Loan
Bank advances |
2,156 |
2,534 |
2,643 |
Interest on other
borrowings |
788 |
313 |
750 |
Interest on subordinated
notes |
1,775 |
1,776 |
— |
Interest on junior subordinated
debentures |
1,933 |
1,942 |
2,004 |
Total interest expense |
18,466 |
18,996 |
17,320 |
Net interest income |
151,891 |
153,719 |
144,006 |
Provision for credit losses |
6,079 |
6,133 |
1,880 |
Net interest income after provision for
credit losses |
145,812 |
147,586 |
142,126 |
Non-interest income |
|
|
|
Wealth management |
18,100 |
18,649 |
16,813 |
Mortgage banking |
27,800 |
24,694 |
16,428 |
Service charges on deposit
accounts |
6,297 |
6,189 |
5,346 |
Gains (losses) on
available-for-sale securities, net |
524 |
18 |
(33) |
Fees from covered call
options |
4,360 |
2,966 |
1,542 |
Trading losses, net |
(477) |
(507) |
(652) |
Other |
7,937 |
5,648 |
6,085 |
Total non-interest income |
64,541 |
57,657 |
45,529 |
Non-interest expense |
|
|
|
Salaries and employee
benefits |
90,130 |
87,633 |
79,934 |
Equipment |
7,836 |
7,555 |
7,403 |
Occupancy, net |
12,351 |
11,600 |
10,993 |
Data processing |
5,448 |
5,313 |
4,715 |
Advertising and marketing |
3,907 |
3,669 |
2,816 |
Professional fees |
4,664 |
4,039 |
3,454 |
Amortization of other
intangible assets |
1,013 |
1,171 |
1,163 |
FDIC insurance |
2,987 |
2,810 |
2,951 |
OREO expense, net |
1,411 |
2,320 |
3,976 |
Other |
17,571 |
17,331 |
13,910 |
Total non-interest expense |
147,318 |
143,441 |
131,315 |
Income before taxes |
63,035 |
61,802 |
56,340 |
Income tax expense |
23,983 |
23,669 |
21,840 |
Net income |
$39,052 |
$38,133 |
$34,500 |
Preferred stock dividends and discount
accretion |
1,581 |
1,580 |
1,581 |
Net income applicable to common
shares |
$37,471 |
$36,553 |
$32,919 |
Net income per common share -
Basic |
$0.79 |
$0.78 |
$0.71 |
Net income per common share -
Diluted |
$0.76 |
$0.75 |
$0.68 |
Cash dividends declared per common
share |
$0.11 |
$0.10 |
$0.10 |
Weighted average common shares
outstanding |
47,239 |
46,734 |
46,195 |
Dilutive potential common shares |
4,233 |
4,243 |
4,509 |
Average common shares and dilutive common
shares |
51,472 |
50,977 |
50,704 |
SUPPLEMENTAL FINANCIAL MEASURES/RATIOS The
accounting and reporting policies of Wintrust conform to generally
accepted accounting principles ("GAAP") in the United States and
prevailing practices in the banking industry. However, certain
non-GAAP performance measures and ratios are used by management to
evaluate and measure the Company's performance. These include
taxable-equivalent net interest income (including its individual
components), net interest margin (including its individual
components), the efficiency ratio, tangible common equity ratio,
tangible common book value per share and return on average tangible
common equity. Management believes that these measures and ratios
provide users of the Company's financial information a more
meaningful view of the performance of the interest-earning assets
and interest-bearing liabilities and of the Company's operating
efficiency. Other financial holding companies may define or
calculate these measures and ratios differently. Management reviews
yields on certain asset categories and the net interest margin of
the Company and its banking subsidiaries on a fully
taxable-equivalent ("FTE") basis. In this non-GAAP presentation,
net interest income is adjusted to reflect tax-exempt interest
income on an equivalent before-tax basis. This measure ensures
comparability of net interest income arising from both taxable and
tax-exempt sources. Net interest income on a FTE basis is also used
in the calculation of the Company's efficiency ratio. The
efficiency ratio, which is calculated by dividing non-interest
expense by total taxable-equivalent net revenue (less securities
gains or losses), measures how much it costs to produce one dollar
of revenue. Securities gains or losses are excluded from this
calculation to better match revenue from daily operations to
operational expenses. Management considers the tangible common
equity ratio and tangible book value per common share as useful
measurements of the Company's equity. The Company references
the return on average tangible common equity as a measurement of
profitability. The following table presents a reconciliation of
certain non-GAAP performance measures and ratios used by the
Company to evaluate and measure the Company's performance to the
most directly comparable GAAP financial measures for the last five
quarters.
|
Three
Months Ended |
|
|
|
|
|
March 31, |
December 31, |
September 30, |
June 30, |
March 31, |
(Dollars and shares in thousands) |
2015 |
2014 |
2014 |
2014 |
2014 |
Calculation of Net Interest Margin
and Efficiency Ratio |
|
|
|
|
|
(A) Interest Income
(GAAP) |
$170,357 |
$172,715 |
$170,676 |
$166,550 |
$161,326 |
Taxable-equivalent
adjustment: |
|
|
|
|
|
- Loans |
327 |
301 |
315 |
281 |
231 |
- Liquidity Management
Assets |
727 |
555 |
502 |
489 |
455 |
- Other Earning
Assets |
7 |
24 |
11 |
2 |
4 |
Interest Income - FTE |
$171,418 |
$173,595 |
$171,504 |
$167,322 |
$162,016 |
(B) Interest Expense
(GAAP) |
18,466 |
18,996 |
19,006 |
17,370 |
17,320 |
Net interest income - FTE |
$152,952 |
$154,599 |
$152,498 |
$149,952 |
$144,696 |
(C) Net Interest Income (GAAP) (A
minus B) |
$151,891 |
$153,719 |
$151,670 |
$149,180 |
$144,006 |
(D) Net interest margin
(GAAP) |
3.40% |
3.44% |
3.45% |
3.60% |
3.59% |
Net interest margin - FTE |
3.42% |
3.46% |
3.46% |
3.62% |
3.61% |
(E) Efficiency ratio
(GAAP) |
68.23% |
67.87% |
66.02% |
65.61% |
69.27% |
Efficiency ratio -
FTE |
67.90% |
67.59% |
65.76% |
65.36% |
69.02% |
(F) Net Overhead Ratio
(GAAP) |
1.69% |
1.76% |
1.67% |
1.74% |
1.93% |
Calculation of Tangible Common Equity
ratio (at period end) |
|
|
|
|
|
Total shareholders' equity |
$2,131,074 |
$2,069,822 |
$2,028,508 |
$1,998,235 |
$1,940,143 |
(G) Less: Preferred stock |
(126,427) |
(126,467) |
(126,467) |
(126,467) |
(126,477) |
Less: Intangible assets |
(439,055) |
(424,445) |
(426,588) |
(398,615) |
(391,775) |
(H) Total tangible common shareholders'
equity |
$1,565,592 |
$1,518,910 |
$1,475,453 |
$1,473,153 |
$1,421,891 |
Total assets |
$20,382,271 |
$20,010,727 |
$19,169,345 |
$18,895,681 |
$18,221,163 |
Less: Intangible assets |
(439,055) |
(424,445) |
(426,588) |
(398,615) |
(391,775) |
(I) Total tangible assets |
$19,943,216 |
$19,586,282 |
$18,742,757 |
$18,497,066 |
$17,829,388 |
Tangible common equity ratio
(H/I) |
7.9% |
7.8% |
7.9% |
8.0% |
8.0% |
Tangible common equity ratio,
assuming full conversion of preferred stock ((H-G)/I) |
8.5% |
8.4% |
8.6% |
8.7% |
8.7% |
Calculation of book value per
share |
|
|
|
|
|
Total shareholders' equity |
$2,131,074 |
$2,069,822 |
$2,028,508 |
$1,998,235 |
$1,940,143 |
Less: Preferred stock |
(126,427) |
(126,467) |
(126,467) |
(126,467) |
(126,477) |
(J) Total common equity |
$2,004,647 |
$1,943,355 |
$1,902,041 |
$1,871,768 |
$1,813,666 |
(K) Actual common shares outstanding |
47,390 |
46,805 |
46,691 |
46,553 |
46,259 |
Book value per share
(J/K) |
$42.30 |
$41.52 |
$40.74 |
$40.21 |
$39.21 |
Tangible common book value per share
(H/K) |
$33.04 |
$32.45 |
$31.60 |
$31.64 |
$30.74 |
Calculation of return on average
common equity |
|
|
|
|
|
(L) Net income applicable to common
shares |
37,471 |
36,553 |
38,643 |
36,960 |
32,919 |
Add: After-tax intangible asset
amortization |
615 |
722 |
739 |
708 |
712 |
(M) Tangible net income applicable to common
shares |
38,086 |
37,275 |
39,382 |
37,668 |
33,631 |
Total average shareholders' equity |
2,114,356 |
2,057,855 |
2,020,903 |
1,971,656 |
1,923,649 |
Less: Average preferred stock |
(126,445) |
(126,467) |
(126,467) |
(126,473) |
(126,477) |
(N) Total average common shareholders'
equity |
1,987,911 |
1,931,388 |
1,894,436 |
1,845,183 |
1,797,172 |
Less: Average intangible assets |
(436,456) |
(425,834) |
(419,125) |
(396,425) |
(392,703) |
(O) Total average tangible common
shareholders' equity |
1,551,455 |
1,505,554 |
1,475,311 |
1,448,758 |
1,404,469 |
Return on average common equity,
annualized (L/N) |
7.64% |
7.51% |
8.09% |
8.03% |
7.43% |
Return on average tangible common
equity, annualized (M/O) |
9.96% |
9.82% |
10.59% |
10.43% |
9.71% |
|
|
|
|
|
|
LOANS Loan Portfolio Mix and Growth
Rates
|
|
|
|
% Growth |
(Dollars in thousands) |
March 31, 2015 |
December 31, 2014 |
March 31, 2014 |
From (1) December 31, 2014 |
From March 31, 2014 |
Balance: |
|
|
|
|
|
Commercial |
$4,211,932 |
$3,924,394 |
$3,439,197 |
30% |
22% |
Commercial
real-estate |
4,710,486 |
4,505,753 |
4,262,255 |
18 |
11 |
Home equity |
709,283 |
716,293 |
707,748 |
(4) |
— |
Residential
real-estate |
495,925 |
483,542 |
426,769 |
10 |
16 |
Premium finance
receivables - commercial |
2,319,623 |
2,350,833 |
2,208,361 |
(5) |
5 |
Premium finance
receivables - life insurance |
2,375,654 |
2,277,571 |
1,929,334 |
17 |
23 |
Consumer and
other(2) |
130,156 |
151,012 |
159,496 |
(56) |
(18) |
Total loans, net
of unearned income, excluding covered loans |
$14,953,059 |
$14,409,398 |
$13,133,160 |
15% |
14% |
Covered
loans |
209,694 |
226,709 |
312,478 |
(30) |
(33) |
Total loans, net of unearned
income |
$15,162,753 |
$14,636,107 |
$13,445,638 |
15% |
13% |
Mix: |
|
|
|
|
|
Commercial |
28% |
26% |
26% |
|
|
Commercial
real-estate |
31 |
31 |
32 |
|
|
Home equity |
5 |
5 |
5 |
|
|
Residential
real-estate |
3 |
3 |
3 |
|
|
Premium finance
receivables - commercial |
15 |
16 |
17 |
|
|
Premium finance
receivables - life insurance |
16 |
16 |
14 |
|
|
Consumer and
other(2) |
1 |
1 |
1 |
|
|
Total loans, net
of unearned income, excluding covered loans |
99% |
98% |
98% |
|
|
Covered
loans |
1 |
2 |
2 |
|
|
Total loans, net
of unearned income |
100% |
100% |
100% |
|
|
|
(1) Annualized |
(2) Includes
autos, boats, snowmobiles and other indirect consumer loans. |
|
|
|
|
|
|
As of March 31, 2015 |
|
|
|
|
|
|
|
|
|
> 90 Days |
Allowance |
|
|
% of |
|
Past Due |
For Loan |
|
|
Total |
|
and Still |
Losses |
(Dollars in thousands) |
Balance |
Balance |
Nonaccrual |
Accruing |
Allocation |
Commercial: |
|
|
|
|
|
Commercial and industrial |
$2,484,465 |
27.8% |
$5,586 |
$— |
$22,549 |
Franchise |
225,762 |
2.6 |
— |
— |
1,645 |
Mortgage warehouse lines of
credit |
186,372 |
2.1 |
— |
— |
1,376 |
Community Advantage - homeowner
associations |
108,382 |
1.2 |
— |
— |
3 |
Aircraft |
6,975 |
0.1 |
— |
— |
9 |
Asset-based lending |
810,685 |
9.1 |
— |
— |
7,033 |
Tax exempt |
205,195 |
2.3 |
— |
— |
1,033 |
Leases |
172,014 |
1.9 |
— |
— |
59 |
Other |
2,735 |
— |
— |
— |
19 |
PCI - commercial loans (1) |
9,347 |
0.1 |
— |
612 |
— |
Total
commercial |
$4,211,932 |
47.2% |
$5,586 |
$612 |
$33,726 |
Commercial Real-Estate: |
|
|
|
|
|
Residential construction |
$46,796 |
0.5% |
$— |
$— |
$694 |
Commercial construction |
210,031 |
2.4 |
— |
— |
3,315 |
Land |
89,042 |
1.0 |
2,646 |
— |
2,216 |
Office |
743,126 |
8.3 |
8,243 |
— |
5,181 |
Industrial |
604,326 |
6.8 |
3,496 |
— |
4,289 |
Retail |
742,527 |
8.3 |
4,975 |
— |
4,856 |
Multi-family |
655,403 |
7.3 |
1,750 |
— |
4,925 |
Mixed use and other |
1,552,563 |
17.4 |
8,872 |
— |
11,413 |
PCI - commercial real-estate
(1) |
66,672 |
0.8 |
— |
18,120 |
113 |
Total commercial
real-estate |
$4,710,486 |
52.8% |
$29,982 |
$18,120 |
$37,002 |
Total commercial and
commercial real-estate |
$8,922,418 |
100.0% |
$35,568 |
$18,732 |
$70,728 |
|
|
|
|
|
|
Commercial real-estate - collateral location
by state: |
|
|
|
|
|
Illinois |
$3,750,211 |
79.6% |
|
|
|
Wisconsin |
476,966 |
10.1 |
|
|
|
Total primary
markets |
$4,227,177 |
89.7% |
|
|
|
Florida |
62,504 |
1.3 |
|
|
|
Arizona |
13,787 |
0.3 |
|
|
|
Indiana |
95,851 |
2.0 |
|
|
|
Other (no individual state
greater than 0.8%) |
311,167 |
6.7 |
|
|
|
Total |
$4,710,486 |
100.0% |
|
|
|
|
|
|
|
|
|
(1) Purchased
credit impaired ("PCI") loans represent loans acquired with
evidence of credit quality deterioration since origination, in
accordance with ASC 310-30. Loan agings are based upon
contractually required payments. |
DEPOSITS Deposit Portfolio Mix and
Growth Rates
|
|
|
|
% Growth |
(Dollars in thousands) |
March 31,
2015 |
December 31, 2014 |
March 31, 2014 |
From (1) December 31, 2014 |
From March 31, 2014 |
Balance: |
|
|
|
|
|
Non-interest bearing |
$3,779,609 |
$3,518,685 |
$2,773,922 |
30% |
36% |
NOW and interest bearing demand
deposits |
2,262,928 |
2,236,089 |
1,983,251 |
5 |
14 |
Wealth Management deposits
(2) |
1,528,963 |
1,226,916 |
1,289,134 |
100 |
19 |
Money Market |
3,791,762 |
3,651,467 |
3,454,271 |
16 |
10 |
Savings |
1,563,752 |
1,508,877 |
1,443,943 |
15 |
8 |
Time certificates of
deposit |
4,011,755 |
4,139,810 |
4,184,524 |
(13) |
(4) |
Total deposits |
$16,938,769 |
$16,281,844 |
$15,129,045 |
16% |
12% |
Mix: |
|
|
|
|
|
Non-interest bearing |
22% |
22% |
18% |
|
|
NOW and interest bearing demand
deposits |
13 |
14 |
13 |
|
|
Wealth Management deposits
(2) |
9 |
8 |
8 |
|
|
Money Market |
23 |
22 |
23 |
|
|
Savings |
9 |
9 |
10 |
|
|
Time certificates of
deposit |
24 |
25 |
28 |
|
|
Total deposits |
100% |
100% |
100% |
|
|
|
|
|
|
|
|
(1) Annualized |
(2) Represents
deposit balances of the Company's subsidiary banks from brokerage
customers of Wayne Hummer Investments, trust and asset management
customers of The Chicago Trust Company and brokerage customers from
unaffiliated companies which have been placed into deposit accounts
of the Banks. |
Time Certificates of Deposit
Maturity/Re-pricing Analysis As of
March 31, 2015
(Dollars in thousands) |
CDARs & Brokered Certificates
of Deposit (1) |
MaxSafe Certificates
of Deposit (1) |
Variable Rate Certificates
of Deposit (2) |
Other Fixed Rate Certificates
of Deposit (1) |
Total Time
Certificates of Deposit |
Weighted- Average
Rate of Maturing Time
Certificates of Deposit (3) |
1-3 months |
$70,697 |
$61,153 |
$155,625 |
$646,089 |
$933,564 |
0.56% |
4-6 months |
36,934 |
62,987 |
— |
607,131 |
707,052 |
0.72% |
7-9 months |
2,176 |
52,785 |
— |
468,245 |
523,206 |
0.70% |
10-12 months |
— |
20,145 |
— |
488,653 |
508,798 |
0.78% |
13-18 months |
201,914 |
13,928 |
— |
478,114 |
693,956 |
0.85% |
19-24 months |
— |
15,157 |
— |
242,971 |
258,128 |
1.06% |
24+ months |
43,013 |
14,526 |
— |
329,512 |
387,051 |
1.17% |
Total |
$354,734 |
$240,681 |
$155,625 |
$3,260,715 |
$4,011,755 |
0.78% |
|
|
|
|
|
|
|
(1) This
category of certificates of deposit is shown by contractual
maturity date. |
(2) This
category includes variable rate certificates of deposit and savings
certificates with the majority repricing on at least a monthly
basis. |
(3) Weighted-average rate excludes the impact of purchase
accounting fair value adjustments. |
NET INTEREST INCOME The following table
presents a summary of Wintrust's average balances, net interest
income and related net interest margins, calculated on a fully
tax-equivalent basis, for the first quarter of 2015 compared to the
fourth quarter of 2014 (sequential quarters) and first quarter of
2014 (linked quarters), respectively:
|
|
|
|
|
Average
Balance for three months ended, |
Interest for three months ended, |
Yield/Rate
for three months ended, |
(Dollars in thousands) |
March 31, 2015 |
December 31, 2014 |
March 31, 2014 |
March 31, 2015 |
December 31, 2014 |
March 31, 2014 |
March 31, 2015 |
December 31, 2014 |
March 31, 2014 |
Liquidity
management assets(1)(2)(7) |
$2,868,906 |
$2,972,220 |
$2,646,720 |
$16,214 |
$15,563 |
$14,533 |
2.29% |
2.08% |
2.23% |
Other earning assets(2)(3)(7) |
27,717 |
29,699 |
28,925 |
201 |
255 |
222 |
2.94 |
3.40 |
3.12 |
Loans, net of unearned income(2)(4)(7) |
15,031,917 |
14,469,745 |
13,278,122 |
151,316 |
153,590 |
140,320 |
4.08 |
4.21 |
4.29 |
Covered loans |
214,211 |
244,139 |
325,885 |
3,687 |
4,187 |
6,941 |
6.98 |
6.80 |
8.64 |
Total earning assets(7) |
$18,142,751 |
$17,715,803 |
$16,279,652 |
$171,418 |
$173,595 |
$162,016 |
3.83% |
3.89% |
4.04% |
Allowance for loan and covered loan
losses |
(96,918) |
(97,506) |
(110,304) |
|
|
|
|
|
|
Cash and due from banks |
249,687 |
243,080 |
223,324 |
|
|
|
|
|
|
Other assets |
1,530,720 |
1,505,293 |
1,588,271 |
|
|
|
|
|
|
Total assets |
$19,826,240 |
$19,366,670 |
$17,980,943 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest-bearing deposits |
$12,863,507 |
$12,771,359 |
$12,121,185 |
$11,814 |
$12,431 |
$11,923 |
0.37% |
0.39% |
0.40% |
Federal Home Loan Bank advances |
357,532 |
335,198 |
388,975 |
2,156 |
2,534 |
2,643 |
2.45 |
3.00 |
2.76 |
Other borrowings |
194,994 |
84,795 |
244,950 |
788 |
313 |
750 |
1.64 |
1.47 |
1.24 |
Subordinated notes |
140,000 |
140,000 |
— |
1,775 |
1,776 |
— |
5.07 |
5.07 |
— |
Junior subordinated notes |
249,493 |
249,493 |
249,493 |
1,933 |
1,942 |
2,004 |
3.10 |
3.04 |
3.21 |
Total interest-bearing
liabilities |
$13,805,526 |
$13,580,845 |
$13,004,603 |
$18,466 |
$18,996 |
$17,320 |
0.54% |
0.55% |
0.54% |
Non-interest bearing deposits |
3,584,452 |
3,398,774 |
2,726,872 |
|
|
|
|
|
|
Other liabilities |
321,906 |
329,196 |
325,819 |
|
|
|
|
|
|
Equity |
2,114,356 |
2,057,855 |
1,923,649 |
|
|
|
|
|
|
Total liabilities and
shareholders' equity |
$19,826,240 |
$19,366,670 |
$17,980,943 |
|
|
|
|
|
|
Interest rate spread(5)(7) |
|
|
|
|
|
|
3.29% |
3.34% |
3.50% |
Net free funds/contribution(6) |
$4,337,225 |
$4,134,958 |
$3,275,049 |
|
|
|
0.13% |
0.12% |
0.11% |
Net interest income/ margin(7) |
|
|
|
$152,952 |
$154,599 |
$144,696 |
3.42% |
3.46% |
3.61% |
|
(1) Liquidity
management assets include available-for-sale securities, interest
earning deposits with banks, federal funds sold and securities
purchased under resale agreements. |
(2) Interest
income on tax-advantaged loans, trading securities and securities
reflects a tax-equivalent adjustment based on a marginal federal
corporate tax rate of 35%. The total adjustments for the three
months ended March 31, 2015, December 31, 2014 and
March 31, 2014 were $1.1 million, $880,000 and $690,000,
respectively. |
(3) Other
earning assets include brokerage customer receivables and trading
account securities. |
(4) Loans,
net of unearned income, include loans held-for-sale and non-accrual
loans. |
(5) Interest
rate spread is the difference between the yield earned on earning
assets and the rate paid on interest-bearing liabilities. |
(6) Net free
funds are the difference between total average earning assets and
total average interest-bearing liabilities. The estimated
contribution to net interest margin from net free funds is
calculated using the rate paid for total interest-bearing
liabilities. |
(7) See
"Supplemental Financial Measures/Ratios" for additional information
on this performance ratio. |
Interest Rate Sensitivity As an ongoing part of
its financial strategy, the Company attempts to manage the impact
of fluctuations in market interest rates on net interest
income. Management measures its exposure to changes in
interest rates by modeling many different interest rate scenarios.
The following interest rate scenarios display the percentage change
in net interest income over a one-year time horizon assuming
increases of 100 and 200 basis points and a decrease of 100 basis
points. The Static Shock Scenario results incorporate actual cash
flows and repricing characteristics for balance sheet instruments
following an instantaneous, parallel change in market rates based
upon a static (i.e. no growth or constant) balance
sheet. Conversely, the Ramp Scenario results incorporate
management's projections of future volume and pricing of each of
the product lines following a gradual, parallel change in market
rates over twelve months. Actual results may differ from these
simulated results due to timing, magnitude, and frequency of
interest rate changes as well as changes in market conditions and
management strategies. The interest rate sensitivity for both the
Static Shock and Ramp Scenarios at March 31,
2015, December 31, 2014 and March 31, 2014 is as
follows:
|
|
|
|
Static Shock Scenarios |
+200 Basis
Points |
+100 Basis
Points |
-100 Basis
Points |
March 31, 2015 |
16.7% |
8.4% |
(9.3)% |
December 31, 2014 |
13.4% |
6.4% |
(10.1)% |
March 31, 2014 |
12.7% |
5.9% |
(12.7)% |
|
|
|
|
Ramp Scenarios |
+200 Basis
Points |
+100 Basis
Points |
-100 Basis
Points |
March 31, 2015 |
6.8% |
3.0% |
(3.7)% |
December 31, 2014 |
5.4% |
2.5% |
(3.9)% |
March 31, 2014 |
5.8% |
3.1% |
(4.5)% |
These results indicate that the Company has positioned its
balance sheet to benefit from a rise in interest rates. This
analysis also indicates that the Company would benefit to a greater
magnitude should a rise in interest rates be significant (i.e. 200
basis points) and immediate (Static Shock Scenario).
NON-INTEREST INCOME The following table presents
non-interest income by category for the periods presented:
|
Three Months
Ended |
|
|
March 31, |
December 31, |
March 31, |
Q1 2015 compared to Q4
2014 |
Q1 2015 compared to Q1
2014 |
(Dollars in thousands) |
2015 |
2014 |
2014 |
$ Change |
% Change |
$ Change |
% Change |
Brokerage |
$6,852 |
$7,892 |
$7,091 |
$(1,040) |
(13)% |
$(239) |
(3)% |
Trust and asset management |
11,248 |
10,757 |
9,722 |
491 |
5 |
1,526 |
16 |
Total wealth management |
18,100 |
18,649 |
16,813 |
(549) |
(3) |
1,287 |
8 |
Mortgage banking |
27,800 |
24,694 |
16,428 |
3,106 |
13 |
11,372 |
69 |
Service charges on deposit accounts |
6,297 |
6,189 |
5,346 |
108 |
2 |
951 |
18 |
Gains (losses) on available-for-sale
securities, net |
524 |
18 |
(33) |
506 |
NM |
557 |
NM |
Fees from covered call options |
4,360 |
2,966 |
1,542 |
1,394 |
47 |
2,818 |
NM |
Trading losses, net |
(477) |
(507) |
(652) |
30 |
6 |
175 |
27 |
Other: |
|
|
|
|
|
|
|
Interest rate swap fees |
2,191 |
1,119 |
951 |
1,072 |
96 |
1,240 |
NM |
Bank Owned Life Insurance |
766 |
661 |
712 |
105 |
16 |
54 |
8 |
Administrative services |
1,026 |
1,107 |
859 |
(81) |
(7) |
167 |
19 |
Miscellaneous |
3,954 |
2,761 |
3,563 |
1,193 |
43 |
391 |
11 |
Total Other |
7,937 |
5,648 |
6,085 |
2,289 |
41 |
1,852 |
30 |
Total Non-Interest Income |
$64,541 |
$57,657 |
$45,529 |
$6,884 |
12% |
$19,012 |
42% |
|
|
|
|
|
|
|
|
NM - Not Meaningful |
The significant changes in non-interest income for the quarter
ended March 31, 2015 compared to the quarters ended
December 31, 2014 and March 31, 2014 are discussed below.
Wealth management revenue totaled $18.1 million in the first
quarter of 2015 compared to $18.6 million in the fourth quarter of
2014, a decrease of 3%, and $16.8 million in the first quarter of
2014, an increase of 8%. The decrease during the current
quarter as compared to the fourth quarter of 2014 is primarily due
to higher brokerage commissions earned in the fourth quarter
partially offset by higher trust and asset management revenues due
to growth in assets under management from new customers and market
appreciation in the current quarter. The increase in
the current quarter as compared to the prior year quarter is
primarily a result of growth in assets under management from new
customers and market appreciation. Wealth management revenue is
comprised of the trust and asset management revenue of The Chicago
Trust Company and Great Lakes Advisors and the brokerage
commissions, money managed fees and insurance product commissions
at Wayne Hummer Investments. For the quarter ended March 31,
2015, mortgage banking revenue totaled $27.8 million, an increase
of $3.1 million, or 13%, when compared to the fourth quarter of
2014, and an increase of $11.4 million, or 69%, when compared to
the first quarter of 2014. The increase in mortgage banking
revenue in the first quarter of 2015 as compared to the fourth
quarter of 2014 and prior year period resulted primarily from
a favorable mortgage banking environment in the current quarter.
Mortgage loans originated or purchased for sale were $941.7 million
in the current quarter as compared to $838.3 million in the fourth
quarter of 2014 and $527.3 million in the first quarter of 2014.
Mortgage banking revenue includes revenue from activities related
to originating, selling and servicing residential real estate loans
for the secondary market. Service charges on deposit accounts
totaled $6.3 million in the first quarter of 2015, an increase of
$108,000 and $951,000 compared to the quarters ended
December 31, 2014 and March 31, 2014,
respectively. The increase in the current quarter compared to
the fourth quarter of 2014 resulted primarily from higher account
analysis fees on deposit accounts which have increased as a result
of the Company's commercial banking initiative. Fees from covered
call option transactions totaled $4.4 million for the first quarter
2015, compared to $3.0 million for the fourth quarter of 2014 and
$1.5 million for the first quarter of 2014. The Company has
typically written call options with terms of less than three months
against certain U.S. Treasury and agency securities held in its
portfolio for liquidity and other purposes. Management has
effectively entered into these transactions with the goal of
economically hedging security positions and enhancing its overall
return on its investment portfolio by using fees generated from
these options to compensate for net interest margin compression.
These option transactions are designed to mitigate overall interest
rate risk and to increase the total return associated with holding
certain investment securities and do not qualify as hedges pursuant
to accounting guidance. Fees from covered call options increased in
the current quarter primarily as a result of selling call options
against a larger value of underlying securities resulting in higher
premiums received by the Company. There were no outstanding call
option contracts at March 31, 2015, December 31, 2014 and March 31,
2014. The Company recognized $477,000 of trading losses in the
first quarter of 2015 compared to trading losses of $507,000 in the
fourth quarter of 2014 and trading losses of $652,000 in the first
quarter of 2014. Trading gains and losses recorded by the Company
primarily result from fair value adjustments related to interest
rate derivatives not designated as hedges, primarily interest rate
cap instruments that the Company uses to manage interest rate risk,
specifically in the event of future increases in short-term
interest rates. The change in value of the cap derivatives
reflects the present value of expected cash flows over the
remaining life of the caps. These expected cash flows are
derived from the expected path for and a measure of volatility for
short-term interest rates. Other non-interest income totaled $7.9
million in the first quarter of 2015 compared to $5.6 million in
the fourth quarter of 2014 and $6.1 million in the first quarter of
2014. Other non-interest income increased in the first quarter
of 2015 as compared to the fourth quarter of 2014 and prior year
period, primarily due to an increase in swap fee revenues resulting
from interest rate hedging transactions related to both
customer-based trades and the related matched trades with
inter-bank dealer counterparties. NON-INTEREST
EXPENSE The following table presents non-interest expense
by category for the periods present:
|
Three Months
Ended |
|
|
March 31, |
December 31, |
March 31, |
Q1 2015 compared to Q4
2014 |
Q1 2015 compared to Q1
2014 |
(Dollars in thousands) |
2015 |
2014 |
2014 |
$ Change |
% Change |
$ Change |
% Change |
Salaries and employee benefits: |
|
|
|
|
|
|
|
Salaries |
$46,848 |
$45,255 |
$43,736 |
$1,593 |
4% |
$3,112 |
7% |
Commissions and incentive
compensation |
25,494 |
28,369 |
21,534 |
(2,875) |
(10) |
3,960 |
18 |
Benefits |
17,788 |
14,009 |
14,664 |
3,779 |
27 |
3,124 |
21 |
Total salaries and employee
benefits |
90,130 |
87,633 |
79,934 |
2,497 |
3 |
10,196 |
13 |
Equipment |
7,836 |
7,555 |
7,403 |
281 |
4 |
433 |
6 |
Occupancy, net |
12,351 |
11,600 |
10,993 |
751 |
6 |
1,358 |
12 |
Data processing |
5,448 |
5,313 |
4,715 |
135 |
3 |
733 |
16 |
Advertising and marketing |
3,907 |
3,669 |
2,816 |
238 |
6 |
1,091 |
39 |
Professional fees |
4,664 |
4,039 |
3,454 |
625 |
15 |
1,210 |
35 |
Amortization of other intangible assets |
1,013 |
1,171 |
1,163 |
(158) |
(13) |
(150) |
(13) |
FDIC insurance |
2,987 |
2,810 |
2,951 |
177 |
6 |
36 |
1 |
OREO expense, net |
1,411 |
2,320 |
3,976 |
(909) |
(39) |
(2,565) |
(65) |
Other: |
|
|
|
|
|
|
|
Commissions - 3rd party
brokers |
1,386 |
1,470 |
1,657 |
(84) |
(6) |
(271) |
(16) |
Postage |
1,633 |
1,724 |
1,429 |
(91) |
(5) |
204 |
14 |
Miscellaneous |
14,552 |
14,137 |
10,824 |
415 |
3 |
3,728 |
34 |
Total other |
17,571 |
17,331 |
13,910 |
240 |
1 |
3,661 |
26 |
Total Non-Interest
Expense |
$147,318 |
$143,441 |
$131,315 |
$3,877 |
3% |
$16,003 |
12% |
The significant changes in non-interest expense for the quarter
ended March 31, 2015 compared to the quarters ended
December 31, 2014 and March 31, 2014 are discussed below.
Salaries and employee benefits expense increased $2.5 million, or
3%, in the first quarter of 2015 compared to the fourth quarter of
2014 primarily as a result of a $3.8 million increase in employee
benefits resulting from higher payroll taxes and an increase of
$1.6 million in salaries caused by the addition of employees from
the acquisition of Delavan and larger staffing as the Company
grows, partially offset by a $2.9 million decrease in commissions
and incentive compensation related to lower expenses on variable
pay based arrangements. Salaries and employee benefits expense
increased $10.2 million, or 13%, compared to the first quarter of
2014 primarily as a result of a $4.0 million increase in
commissions and incentive compensation primarily attributable to
higher expenses on variable pay based arrangements, a $3.1 million
increase in employee benefits resulting from adjustments to pension
liabilities in the prior year quarter as well as higher payroll
taxes and a $3.1 million increase in salaries as a result of
various acquisitions and additional staffing as the Company grows.
Equipment expense totaled $7.8 million for the first quarter of
2015, an increase of $281,000 compared to the fourth quarter of
2014 and an increase of $433,000 compared to the first quarter of
2014. The increase in the current quarter compared to the prior
year quarter is primarily related to increased software license
fees. Equipment expense includes depreciation on equipment,
maintenance and repairs, equipment rental and software license
fees. Occupancy expense for the first quarter of 2015 was
$12.4 million, an increase of $751,000, or 6%, compared to the
fourth quarter of 2014 and an increase of $1.4 million, or 12%,
compared to the same period in 2014. The increase in the first
quarter of 2015 as compared to the fourth quarter of 2014 and first
quarter of 2014 is primarily the result of increased rent expense
on leased properties as well as additional depreciation and utility
and maintenance expenses on owned locations including those
obtained in the Company's acquisitions. Occupancy expense includes
depreciation on premises, real estate taxes, utilities and
maintenance of premises, as well as net rent expense for leased
premises. Advertising and marketing expenses totaled $3.9 million
in the first quarter of 2015, an increase of $238,000 compared to
the fourth quarter of 2014 and an increase of $1.1 million compared
to the first quarter of 2014. The increase in the current
quarter compared to the prior year quarter relates primarily to
expenses for community-related advertisements and sponsorships.
Professional fees for the first quarter of 2015 were $4.7 million,
compared to $4.0 million for the fourth quarter of 2014 and $3.5
million in the first quarter of 2014. The increase in professional
fees in the current quarter as compared to the fourth quarter of
2014 and first quarter of 2014 is due to an increase in legal
expenses, including legal fees incurred in connection with recent
acquisitions. Professional fees include legal, audit and tax fees,
external loan review costs and normal regulatory exam assessments.
OREO expense totaled $1.4 million in the first quarter of 2015
compared to OREO expense of $2.3 million recorded in the fourth
quarter of 2014 and $4.0 million recorded in the first quarter of
2014. OREO expense was lower in the current quarter compared
to the quarter ended December 31, 2014 and March 31, 2014
primarily due to fewer negative valuation adjustments of certain
OREO properties as well as higher gains recorded on covered OREO
sales in the current quarter. OREO costs include all costs
related to obtaining, maintaining and selling other real estate
owned properties. Miscellaneous expense in
the first quarter of 2015 increased $415,000, or 3%, compared to
the quarter ended December 31, 2014 and increased $3.7
million, or 34%, compared to the quarter ended March 31,
2014. Miscellaneous expense includes ATM expenses,
correspondent bank charges, directors' fees, telephone, travel and
entertainment, corporate insurance, dues and subscriptions, problem
loan expenses and lending origination costs that are not
deferred. The non-interest expense categories discussed above
include expenses related to acquisitions. The following table
presents the detail of these acquisition related
expenses:
|
Three Months
Ended, |
|
March 31, |
(Dollars in thousands) |
2015 |
Salaries and employee benefits: |
|
Salaries |
$12 |
Benefits |
3 |
Total salaries and employee
benefits |
15 |
Occupancy, net |
16 |
Data processing |
130 |
Advertising and marketing |
5 |
Professional fees |
568 |
Miscellaneous |
4 |
Total Acquisition
Related Expenses |
$738 |
|
|
ASSET QUALITY Allowance for Credit Losses,
excluding covered loans
|
Three Months
Ended |
|
March 31, |
December 31, |
March 31, |
(Dollars in thousands) |
2015 |
2014 |
2014 |
Allowance for loan losses at
beginning of period |
$91,705 |
$91,019 |
$96,922 |
Provision for credit
losses |
6,185 |
6,744 |
3,304 |
Other adjustments |
(248) |
(236) |
(148) |
Reclassification from (to) allowance
for unfunded lending-related commitments |
(113) |
46 |
(18) |
Charge-offs: |
|
|
|
Commercial |
677 |
289 |
648 |
Commercial real estate |
1,005 |
4,434 |
4,493 |
Home equity |
584 |
150 |
2,267 |
Residential real estate |
631 |
630 |
226 |
Premium finance receivables -
commercial |
1,263 |
1,463 |
1,210 |
Premium finance receivables -
life insurance |
— |
4 |
— |
Consumer and other |
111 |
156 |
173 |
Total charge-offs |
4,271 |
7,126 |
9,017 |
Recoveries: |
|
|
|
Commercial |
370 |
315 |
317 |
Commercial real estate |
312 |
572 |
145 |
Home equity |
48 |
57 |
257 |
Residential real estate |
76 |
19 |
131 |
Premium finance receivables -
commercial |
329 |
219 |
319 |
Premium finance receivables -
life insurance |
— |
6 |
2 |
Consumer and other |
53 |
70 |
61 |
Total recoveries |
1,188 |
1,258 |
1,232 |
Net
charge-offs |
(3,083) |
(5,868) |
(7,785) |
Allowance for loan
losses at period end |
$94,446 |
$91,705 |
$92,275 |
Allowance for unfunded
lending-related commitments at period end |
888 |
775 |
737 |
Allowance for credit
losses at period end |
$95,334 |
$92,480 |
$93,012 |
Annualized net
charge-offs by category as a percentage of its own respective
category's average: |
|
|
|
Commercial |
0.03% |
—% |
0.04% |
Commercial real estate |
0.06 |
0.34 |
0.41 |
Home equity |
0.30 |
0.05 |
1.14 |
Residential real estate |
0.28 |
0.30 |
0.06 |
Premium finance receivables -
commercial |
0.16 |
0.21 |
0.16 |
Premium finance receivables -
life insurance |
— |
— |
— |
Consumer and other |
0.13 |
0.19 |
0.26 |
Total loans, net of unearned
income, excluding covered loans |
0.08% |
0.16% |
0.24% |
Net charge-offs as a
percentage of the provision for credit losses |
49.87% |
86.98% |
235.65% |
Loans at period-end,
excluding covered loans |
$14,953,059 |
$14,409,398 |
$13,133,160 |
Allowance for loan
losses as a percentage of loans at period end |
0.63% |
0.64% |
0.70% |
Allowance for credit
losses as a percentage of loans at period end |
0.64% |
0.64% |
0.71% |
The allowance for credit losses, excluding the allowance for
covered loan losses, is comprised of the allowance for loan losses
and the allowance for unfunded lending-related commitments. The
allowance for loan losses is a reserve against loan amounts that
are actually funded and outstanding while the allowance for
unfunded lending-related commitments (separate liability account)
relates to certain amounts that Wintrust is committed to lend but
for which funds have not yet been disbursed. The provision for
credit losses, excluding the provision for covered loan losses, may
contain both a component related to funded loans (provision for
loan losses) and a component related to lending-related commitments
(provision for unfunded loan commitments and letters of credit).
The provision for credit losses, excluding the provision for
covered loan losses, totaled $6.2 million for the first quarter of
2015 compared to $6.7 million for the fourth quarter of 2014 and
$3.3 million for the first quarter of 2014. The lower provision for
credit losses in the first quarter of 2014 was primarily due
to a reduction recorded in the provision associated with general
reserves during that period. The reduction at that time was driven
by improvement in credit quality metrics compared to periods prior
to the first quarter of 2014, including historical charge-off rates
and lower levels of non-performing and adversely classified loans.
Credit quality metrics remained relatively stable in the first
quarter of 2015 compared to the same period of the prior year. Net
charge-offs as a percentage of loans, excluding covered loans, for
the first quarter of 2015 totaled eight basis points on an
annualized basis compared to 16 basis points on an annualized basis
in the fourth quarter of 2014 and 24 basis points on an annualized
basis in the first quarter of 2014. Net charge-offs totaled
$3.1 million in the first quarter of 2015, a $2.8 million decrease
from $5.9 million in the fourth quarter of 2014 and a $4.7 million
decrease from $7.8 million in the first quarter of 2014. Compared
to the first quarter of 2014, net charge-offs decreased primarily
as a result of a $3.7 million and $1.5 million decrease in net
charge-offs within the commercial real-estate and home equity
loan portfolios, respectively. Excluding the allowance for covered
loan losses, the allowance for credit losses at March 31, 2015
totaled $95.3 million, or 0.64% of total loans, compared to $92.5
million, or 0.64% of total loans, at December 31, 2014 and
$93.0 million, or 0.71% of total loans, at March 31,
2014. The allowance for unfunded lending-related commitments
totaled $888,000 as of March 31, 2015 compared to $775,000 as
of December 31, 2014 and $737,000 as of March 31, 2014.
Management believes the allowance for credit losses is appropriate
to provide for inherent losses in the portfolio. There can be no
assurances however, that future losses will not exceed the amounts
provided for, thereby affecting future results of operations. The
amount of future additions to the allowance for credit losses will
be dependent upon management's assessment of the appropriateness of
the allowance based on its evaluation of economic conditions,
changes in real estate values, interest rates, the regulatory
environment, the level of past-due and non-performing loans, and
other factors. The Company also provides a provision for covered
loan losses on covered loans and maintains an allowance for covered
loan losses on covered loans. Please see "Covered Assets" later in
this document for more detail. The following table presents the
provision for credit losses and allowance for credit losses by
component for the periods presented:
|
Three months
ended |
|
March 31, |
December 31, |
March 31, |
(Dollars in thousands) |
2015 |
2014 |
2014 |
Provision for loan losses |
$6,072 |
$6,790 |
$3,286 |
Provision for unfunded lending-related
commitments |
113 |
(46) |
18 |
Provision for covered loan losses |
(106) |
(611) |
(1,424) |
Provision for credit losses |
$6,079 |
$6,133 |
$1,880 |
|
|
|
Period
End |
|
March 31, |
December 31, |
March 31, |
|
2015 |
2014 |
2014 |
Allowance for loan losses |
$94,446 |
$91,705 |
$92,275 |
Allowance for unfunded lending-related
commitments |
888 |
775 |
737 |
Allowance for covered loan losses |
1,878 |
2,131 |
3,447 |
Allowance for credit losses |
$97,212 |
$94,611 |
$96,459 |
|
|
|
|
The tables below summarize the calculation of allowance for loan
losses for the Company's core loan portfolio and consumer, niche
and purchased loan portfolio as of March 31, 2015 and
December 31, 2014.
|
As of March 31,
2015 |
|
Recorded |
Calculated |
As a percentage
of its own respective |
(Dollars in thousands) |
Investment |
Allowance |
category's
balance |
Commercial:(1) |
|
|
|
Commercial and industrial |
$2,414,570 |
$22,534 |
0.93% |
Asset-based lending |
806,918 |
7,033 |
0.87 |
Tax exempt |
204,024 |
1,033 |
0.51 |
Leases |
172,014 |
59 |
0.03 |
Other |
2,735 |
19 |
0.69 |
Commercial real-estate:(1) |
|
|
|
Residential construction |
45,803 |
694 |
1.52 |
Commercial construction |
208,215 |
3,315 |
1.59 |
Land |
82,094 |
2,216 |
2.70 |
Office |
710,863 |
5,151 |
0.72 |
Industrial |
583,989 |
4,287 |
0.73 |
Retail |
707,117 |
4,855 |
0.69 |
Multi-family |
618,975 |
4,925 |
0.80 |
Mixed use and other |
1,409,264 |
11,405 |
0.81 |
Home equity(1) |
687,867 |
12,641 |
1.84 |
Residential real-estate(1) |
458,830 |
3,973 |
0.87 |
Total core loan
portfolio |
$9,113,278 |
$84,140 |
0.92% |
Commercial: |
|
|
|
Franchise |
$225,762 |
$1,645 |
0.73% |
Mortgage warehouse lines of
credit |
186,372 |
1,376 |
0.74 |
Community Advantage - homeowner
associations |
108,382 |
3 |
— |
Aircraft |
6,975 |
9 |
0.13 |
Purchased non-covered
commercial loans (2) |
84,180 |
15 |
0.02 |
Commercial real-estate: |
|
|
|
Purchased non-covered
commercial real-estate (2) |
344,166 |
154 |
0.04 |
Purchased non-covered home equity (2) |
21,416 |
23 |
0.11 |
Purchased non-covered residential real-estate
(2) |
37,095 |
123 |
0.33 |
Premium finance receivables |
|
|
|
U.S. commercial insurance
loans |
2,046,580 |
4,789 |
0.23 |
Canada commercial insurance
loans (2) |
273,043 |
529 |
0.19 |
Life insurance loans (1) |
1,986,606 |
674 |
0.03 |
Purchased life insurance loans
(2) |
389,048 |
— |
— |
Consumer and other (1) |
126,122 |
965 |
0.77 |
Purchased non-covered consumer and other
(2) |
4,034 |
1 |
0.02 |
Total consumer, niche
and purchased loan portfolio |
$5,839,781 |
$10,306 |
0.18% |
Total loans, net of
unearned income, excluding covered loans |
$14,953,059 |
$94,446 |
0.63% |
Non-accretable credit discounts on purchased
loans reported in accordance with ASC 310-30, excluding covered
loans |
|
$14,442 |
|
Total allowance for
loan losses and non-accretable credit discounts on purchased loans,
excluding covered loans |
|
$108,888 |
0.73% |
|
|
|
|
(1) Excludes
purchased loans reported in accordance with ASC 310-20 and ASC
310-30. |
(2) Purchased
loans represent loans reported in accordance with ASC 310-20 and
ASC 310-30. |
|
As of December
31, 2014 |
|
Recorded |
Calculated |
As a percentage
of its own respective |
(Dollars in thousands) |
Investment |
Allowance |
category's
balance |
Commercial:(1) |
|
|
|
Commercial and
industrial |
$2,178,023 |
$20,741 |
0.95% |
Asset-based
lending |
801,937 |
7,051 |
0.88 |
Tax exempt |
217,299 |
1,077 |
0.50 |
Leases |
160,104 |
32 |
0.02 |
Other |
11,034 |
79 |
0.72 |
Commercial real-estate:(1) |
|
|
|
Residential construction |
38,475 |
609 |
1.58 |
Commercial construction |
184,463 |
2,780 |
1.51 |
Land |
85,782 |
2,289 |
2.67 |
Office |
673,663 |
4,596 |
0.68 |
Industrial |
601,330 |
3,890 |
0.65 |
Retail |
699,001 |
4,990 |
0.71 |
Multi-family |
573,074 |
4,366 |
0.76 |
Mixed use and other |
1,365,627 |
11,876 |
0.87 |
Home equity(1) |
697,121 |
12,472 |
1.79 |
Residential real-estate(1) |
457,272 |
4,082 |
0.89 |
Total core loan
portfolio |
$8,744,205 |
$80,930 |
0.93% |
Commercial: |
|
|
|
Franchise |
$233,316 |
$1,696 |
0.73% |
Mortgage warehouse lines of
credit |
139,003 |
995 |
0.72 |
Community Advantage - homeowner
associations |
106,364 |
3 |
— |
Aircraft |
7,135 |
10 |
0.14 |
Purchased non-covered
commercial loans (2) |
70,179 |
15 |
0.02 |
Commercial real-estate: |
|
|
|
Purchased non-covered
commercial real-estate (2) |
284,338 |
137 |
0.05 |
Purchased non-covered home equity (2) |
19,172 |
28 |
0.15 |
Purchased non-covered residential real-estate
(2) |
26,270 |
136 |
0.52 |
Premium finance receivables |
|
|
|
U.S. commercial insurance
loans |
2,039,299 |
5,155 |
0.25 |
Canada commercial insurance
loans (2) |
311,534 |
571 |
0.18 |
Life insurance loans (1) |
1,884,092 |
787 |
0.04 |
Purchased life insurance loans
(2) |
393,479 |
— |
— |
Consumer and other (1) |
146,891 |
1,240 |
0.84 |
Purchased non-covered consumer and other
(2) |
4,121 |
2 |
0.05 |
Total consumer, niche
and purchased loan portfolio |
$5,665,193 |
$10,775 |
0.19% |
Total loans, net of
unearned income, excluding covered loans |
$14,409,398 |
$91,705 |
0.64% |
Non-accretable credit discounts on purchased
loans reported in accordance with ASC 310-30, excluding covered
loans |
|
$15,138 |
|
Total allowance for
loan losses and non-accretable credit discounts on purchased loans,
excluding covered loans |
|
$106,843 |
0.74% |
|
|
|
|
(1) Excludes
purchased loans reported in accordance with ASC 310-20 and ASC
310-30. |
(2) Purchased
loans represent loans reported in accordance with ASC 310-20 and
ASC 310-30. |
As part of a quarterly review performed by Management to
determine if the Company's allowance for loan losses is
appropriate, an analysis is prepared on the loan portfolio based
upon a breakout of core loans and consumer, niche and purchased
loans. A summary of the allowance for loan losses calculated for
the loan components in both the core loan portfolio and the
consumer, niche and purchased loan portfolio was shown on the
previous pages as of March 31, 2015 and December 31,
2014. The allowance for loan losses to the core loans was 0.92%
compared to 0.18% for consumer, niche and purchased loans and 0.63%
for the entire loan portfolio as of March 31, 2015. As of
December 31, 2014, the allowance for loan losses to core loans
was 0.93% compared to 0.19% for consumer, niche and purchased loans
and 0.64% for the entire loan portfolio. The decrease in the
allowance for loan losses to core loans in the first quarter of
2015 compared to the fourth quarter of 2014 was attributable to a
shift in the mix of core loans requiring ASC 450 reserves (general
reserves) in the current quarter and a smaller population of core
loans requiring ASC 310 reserves (specific reserves). Loans
requiring ASC 450 reserves typically have lower reserve factors as
compared to core loans requiring ASC 310 reserves. ASC 310
reserves are maintained on impaired loans. As discussed within this
section, credit quality metrics improved in the current quarter
compared to the same quarter of last year including a reduction in
the level of non-performing assets, increased allowance for loan
losses coverage of non-performing loans and decreased net
charge-offs. These current credit quality metrics are comparable to
the pre-credit crisis levels reported between 2005 and
2008. However, we are able to carry a slightly lower ratio of
allowance for loan losses to total loans than during the pre-credit
crisis period as the result of the fact that the mix of the
Company's loan portfolio is now more heavily weighted toward niche
and purchased loans which historically require lower
reserves. The niche and purchased components of our total loan
portfolio now comprise 39% as compared to 23% of the total loan
portfolio at December 31, 2005. Our current loan portfolio is
comprised of a core portion totaling $9.1 billion with a 0.92%
basis point allowance for loan losses and a niche and purchased
component totaling $5.8 billion that only requires 0.18% basis
points of allowance for loan losses. Purchased loans acquired in a
business combination are recorded at estimated fair value on their
purchase date. In accordance with accounting guidance, credit
deterioration on purchased loans is recorded as a credit discount
at the time of purchase instead of as an increase to the allowance
for loan losses. For analysis purposes, the Company has combined
the non-accretable credit discounts recorded on purchased loans
with the total allowance for loan losses in the previous tables to
present the total credit reserves available on its loan portfolio.
The total allowance for loan losses and non-accretable credit
discounts on purchased loans was 0.73% of the total loan portfolio
as of March 31, 2015 as compared to 0.74% as of December 31, 2014.
The Company expects the total allowance for loan losses and
non-accretable credit discounts on purchased loans to total loans
ratio to increase in periods that have acquisitions and decrease in
periods without acquisitions, based on the performance of the
purchased loan portfolios. The table below shows the aging of the
Company's loan portfolio at March 31, 2015:
|
|
|
|
|
|
|
|
|
90+ days |
60-89 |
30-59 |
|
|
As of March 31, 2015 |
|
and still |
days past |
days past |
|
|
(Dollars in thousands) |
Nonaccrual |
accruing |
due |
due |
Current |
Total Loans |
Loan Balances: |
|
|
|
|
|
|
Commercial |
|
|
|
|
|
|
Commercial and industrial |
$5,586 |
$— |
$4,756 |
$16,949 |
$2,457,174 |
$2,484,465 |
Franchise |
— |
— |
— |
457 |
225,305 |
225,762 |
Mortgage warehouse lines of
credit |
— |
— |
— |
— |
186,372 |
186,372 |
Community Advantage -
homeowners association |
— |
— |
— |
— |
108,382 |
108,382 |
Aircraft |
— |
— |
291 |
389 |
6,295 |
6,975 |
Asset-based lending |
— |
— |
— |
4,819 |
805,866 |
810,685 |
Tax exempt |
— |
— |
— |
— |
205,195 |
205,195 |
Leases |
— |
— |
65 |
517 |
171,432 |
172,014 |
Other |
— |
— |
— |
— |
2,735 |
2,735 |
PCI - commercial (1) |
— |
612 |
— |
— |
8,735 |
9,347 |
Total commercial |
5,586 |
612 |
5,112 |
23,131 |
4,177,491 |
4,211,932 |
Commercial real-estate |
|
|
|
|
|
|
Residential construction |
— |
— |
— |
— |
46,796 |
46,796 |
Commercial construction |
— |
— |
— |
992 |
209,039 |
210,031 |
Land |
2,646 |
— |
— |
1,942 |
84,454 |
89,042 |
Office |
8,243 |
— |
171 |
3,144 |
731,568 |
743,126 |
Industrial |
3,496 |
— |
61 |
1,719 |
599,050 |
604,326 |
Retail |
4,975 |
— |
— |
2,562 |
734,990 |
742,527 |
Multi-family |
1,750 |
— |
393 |
3,671 |
649,589 |
655,403 |
Mixed use and other |
8,872 |
— |
808 |
10,847 |
1,532,036 |
1,552,563 |
PCI - commercial real-estate
(1) |
— |
18,120 |
4,639 |
3,242 |
40,671 |
66,672 |
Total commercial
real-estate |
29,982 |
18,120 |
6,072 |
28,119 |
4,628,193 |
4,710,486 |
Home equity |
7,665 |
— |
693 |
2,825 |
698,100 |
709,283 |
Residential real estate |
14,248 |
— |
753 |
8,735 |
469,826 |
493,562 |
PCI - residential real estate (1) |
— |
266 |
— |
84 |
2,013 |
2,363 |
Premium finance receivables |
|
|
|
|
|
|
Commercial insurance loans |
15,902 |
8,062 |
4,476 |
19,392 |
2,271,791 |
2,319,623 |
Life insurance loans |
— |
— |
8,994 |
5,415 |
1,972,197 |
1,986,606 |
PCI - life insurance loans
(1) |
— |
— |
— |
— |
389,048 |
389,048 |
Consumer and other |
236 |
91 |
111 |
634 |
129,084 |
130,156 |
Total loans, net of unearned
income, excluding covered loans |
$73,619 |
$27,151 |
$26,211 |
$88,335 |
$14,737,743 |
$14,953,059 |
Covered loans |
7,079 |
16,434 |
558 |
6,128 |
179,495 |
209,694 |
Total loans, net of unearned
income |
$80,698 |
$43,585 |
$26,769 |
$94,463 |
$14,917,238 |
$15,162,753 |
|
(1) PCI loans
represent loans acquired with evidence of credit quality
deterioration since origination, in accordance with ASC 310-30.
Loan agings are based upon contractually required payments. |
|
|
|
90+ days |
60-89 |
30-59 |
|
|
As of March 31, 2015 |
|
and still |
days past |
days past |
|
|
Aging as a % of Loan Balance |
Nonaccrual |
accruing |
due |
due |
Current |
Total Loans |
Commercial |
|
|
|
|
|
|
Commercial and industrial |
0.2% |
—% |
0.2% |
0.7% |
98.9% |
100.0% |
Franchise |
— |
— |
— |
0.2 |
99.8 |
100.0 |
Mortgage warehouse lines of credit |
— |
— |
— |
— |
100.0 |
100.0 |
Community Advantage - homeowners
association |
— |
— |
— |
— |
100.0 |
100.0 |
Aircraft |
— |
— |
4.2 |
5.6 |
90.2 |
100.0 |
Asset-based lending |
— |
— |
— |
0.6 |
99.4 |
100.0 |
Tax exempt |
— |
— |
— |
— |
100.0 |
100.0 |
Leases |
— |
— |
— |
0.3 |
99.7 |
100.0 |
Other |
— |
— |
— |
— |
100.0 |
100.0 |
PCI - commercial(1) |
— |
6.5 |
— |
— |
93.5 |
100.0 |
Total commercial |
0.1 |
— |
0.1 |
0.6 |
99.2 |
100.0 |
Commercial real-estate |
|
|
|
|
|
|
Residential construction |
— |
— |
— |
— |
100.0 |
100.0 |
Commercial construction |
— |
— |
— |
0.5 |
99.5 |
100.0 |
Land |
3.0 |
— |
— |
2.2 |
94.8 |
100.0 |
Office |
1.1 |
— |
— |
0.4 |
98.5 |
100.0 |
Industrial |
0.6 |
— |
— |
0.3 |
99.1 |
100.0 |
Retail |
0.7 |
— |
— |
0.3 |
99.0 |
100.0 |
Multi-family |
0.3 |
— |
0.1 |
0.6 |
99.0 |
100.0 |
Mixed use and other |
0.6 |
— |
0.1 |
0.7 |
98.6 |
100.0 |
PCI - commercial
real-estate (1) |
— |
27.2 |
7.0 |
4.9 |
60.9 |
100.0 |
Total commercial real-estate |
0.6 |
0.4 |
0.1 |
0.6 |
98.3 |
100.0 |
Home equity |
1.1 |
— |
0.1 |
0.4 |
98.4 |
100.0 |
Residential real estate |
2.9 |
— |
0.2 |
1.8 |
95.1 |
100.0 |
PCI - residential real estate(1) |
— |
11.3 |
— |
3.6 |
85.1 |
100.0 |
Premium finance receivables |
|
|
|
|
|
|
Commercial insurance loans |
0.7 |
0.4 |
0.2 |
0.8 |
97.9 |
100.0 |
Life insurance loans |
— |
— |
0.5 |
0.3 |
99.2 |
100.0 |
PCI - life insurance loans (1) |
— |
— |
— |
— |
100.0 |
100.0 |
Consumer and other |
0.2 |
0.1 |
0.1 |
0.5 |
99.1 |
100.0 |
Total loans, net of unearned income,
excluding covered loans |
0.5% |
0.2% |
0.2% |
0.6% |
98.5% |
100.0% |
Covered loans |
3.4 |
7.8 |
0.3 |
2.9 |
85.6 |
100.0 |
Total loans, net of unearned income |
0.5% |
0.3% |
0.2% |
0.6% |
98.4% |
100.0% |
As of March 31, 2015, $26.2 million of all loans, excluding
covered loans, or 0.2%, were 60 to 89 days past due and $88.3
million, or 0.6%, were 30 to 59 days (or one payment) past due. As
of December 31, 2014, $38.0 million of all loans, excluding
covered loans, or 0.3%, were 60 to 89 days past due and $67.8
million, or 0.5%, were 30 to 59 days (or one payment) past due. The
majority of the commercial and commercial real estate loans shown
as 60 to 89 days and 30 to 59 days past due are included on the
Company's internal problem loan reporting system. Loans on this
system are closely monitored by management on a monthly basis.
The Company's home equity and residential loan portfolios
continue to exhibit low delinquency ratios. Home equity loans at
March 31, 2015 that are current with regard to the contractual
terms of the loan agreement represent 98.4% of the total home
equity portfolio. Residential real estate loans at March 31,
2015 that are current with regards to the contractual terms of the
loan agreements comprise 95.1% of total residential real estate
loans outstanding, which includes purchased non-covered residential
real-estate.
The table below shows the aging of the Company's loan portfolio
at December 31, 2014:
|
|
90+ days |
60-89 |
30-59 |
|
|
As of December 31, 2014 |
|
and still |
days past |
days past |
|
|
(Dollars in thousands) |
Nonaccrual |
accruing |
due |
due |
Current |
Total Loans |
Loan Balances: |
|
|
|
|
|
|
Commercial |
|
|
|
|
|
|
Commercial and industrial |
$ 9,132 |
$ 474 |
$ 3,161 |
$ 7,492 |
$ 2,213,105 |
$ 2,233,364 |
Franchise |
— |
— |
308 |
1,219 |
231,789 |
233,316 |
Mortgage warehouse lines of credit |
— |
— |
— |
— |
139,003 |
139,003 |
Community Advantage - homeowners
association |
— |
— |
— |
— |
106,364 |
106,364 |
Aircraft |
— |
— |
— |
— |
8,065 |
8,065 |
Asset-based lending |
25 |
— |
1,375 |
2,394 |
802,608 |
806,402 |
Tax exempt |
— |
— |
— |
— |
217,487 |
217,487 |
Leases |
— |
— |
77 |
315 |
159,744 |
160,136 |
Other |
— |
— |
— |
— |
11,034 |
11,034 |
PCI - commercial(1) |
— |
365 |
202 |
138 |
8,518 |
9,223 |
Total commercial |
9,157 |
839 |
5,123 |
11,558 |
3,897,717 |
3,924,394 |
Commercial real-estate |
|
|
|
|
|
|
Residential construction |
— |
— |
250 |
76 |
38,370 |
38,696 |
Commercial construction |
230 |
— |
— |
2,023 |
185,513 |
187,766 |
Land |
2,656 |
— |
— |
2,395 |
86,779 |
91,830 |
Office |
7,288 |
— |
2,621 |
1,374 |
694,149 |
705,432 |
Industrial |
2,392 |
— |
— |
3,758 |
617,820 |
623,970 |
Retail |
4,152 |
— |
116 |
3,301 |
723,919 |
731,488 |
Multi-family |
249 |
— |
249 |
1,921 |
603,323 |
605,742 |
Mixed use and other |
9,638 |
— |
2,603 |
9,023 |
1,443,853 |
1,465,117 |
PCI - commercial
real-estate (1) |
— |
10,976 |
6,393 |
4,016 |
34,327 |
55,712 |
Total commercial real-estate |
26,605 |
10,976 |
12,232 |
27,887 |
4,428,053 |
4,505,753 |
Home equity |
6,174 |
— |
983 |
3,513 |
705,623 |
716,293 |
Residential real estate |
15,502 |
— |
267 |
6,315 |
459,224 |
481,308 |
PCI - residential real estate (1) |
— |
549 |
— |
— |
1,685 |
2,234 |
Premium finance receivables |
|
|
|
|
|
|
Commercial insurance loans |
12,705 |
7,665 |
5,995 |
17,328 |
2,307,140 |
2,350,833 |
Life insurance loans |
— |
— |
13,084 |
339 |
1,870,669 |
1,884,092 |
PCI - life insurance loans (1) |
— |
— |
— |
— |
393,479 |
393,479 |
Consumer and other |
277 |
119 |
293 |
838 |
149,485 |
151,012 |
Total loans, net of unearned income,
excluding covered loans |
$ 70,420 |
$ 20,148 |
$ 37,977 |
$ 67,778 |
$ 14,213,075 |
$ 14,409,398 |
Covered loans |
7,290 |
17,839 |
1,304 |
4,835 |
195,441 |
226,709 |
Total loans, net of unearned income |
$ 77,710 |
$ 37,987 |
$ 39,281 |
$ 72,613 |
$ 14,408,516 |
$ 14,636,107 |
|
|
|
|
|
|
|
(1) PCI loans represent
loans acquired with evidence of credit quality deterioration since
origination, in accordance with ASC 310-30. Loan agings are based
upon contractually required payments. |
|
|
|
|
|
|
|
|
|
90+ days |
60-89 |
30-59 |
|
|
As of December 31, 2014 |
|
and still |
days past |
days past |
|
|
Aging as a % of Loan Balance: |
Nonaccrual |
accruing |
due |
due |
Current |
Total Loans |
Commercial |
|
|
|
|
|
|
Commercial and industrial |
0.4% |
—% |
0.1% |
0.3% |
99.2% |
100.0% |
Franchise |
— |
— |
0.1 |
0.5 |
99.4 |
100.0 |
Mortgage warehouse lines of credit |
— |
— |
— |
— |
100.0 |
100.0 |
Community Advantage - homeowners
association |
— |
— |
— |
— |
100.0 |
100.0 |
Aircraft |
— |
— |
— |
— |
100.0 |
100.0 |
Asset-based lending |
— |
— |
0.2 |
0.3 |
99.5 |
100.0 |
Tax exempt |
— |
— |
— |
— |
100.0 |
100.0 |
Leases |
— |
— |
— |
0.2 |
99.8 |
100.0 |
Other |
— |
— |
— |
— |
100.0 |
100.0 |
PCI - commercial(1) |
— |
4.0 |
2.2 |
1.5 |
92.3 |
100.0 |
Total commercial |
0.2 |
— |
0.1 |
0.3 |
99.4 |
100.0 |
Commercial real-estate |
|
|
|
|
|
|
Residential construction |
— |
— |
0.6 |
0.2 |
99.2 |
100.0 |
Commercial construction |
0.1 |
— |
— |
1.1 |
98.8 |
100.0 |
Land |
2.9 |
— |
— |
2.6 |
94.5 |
100.0 |
Office |
1.0 |
— |
0.4 |
0.2 |
98.4 |
100.0 |
Industrial |
0.4 |
— |
— |
0.6 |
99.0 |
100.0 |
Retail |
0.6 |
— |
— |
0.5 |
98.9 |
100.0 |
Multi-family |
— |
— |
— |
0.3 |
99.7 |
100.0 |
Mixed use and other |
0.7 |
— |
0.2 |
0.6 |
98.5 |
100.0 |
PCI - commercial real-estate (1) |
— |
19.7 |
11.5 |
7.2 |
61.6 |
100.0 |
Total commercial real-estate |
0.6 |
0.2 |
0.3 |
0.6 |
98.3 |
100.0 |
Home equity |
0.9 |
— |
0.1 |
0.5 |
98.5 |
100.0 |
Residential real estate |
3.2 |
— |
0.1 |
1.3 |
95.4 |
100.0 |
PCI - residential real estate (1) |
— |
24.6 |
— |
— |
75.4 |
100.0 |
Premium finance receivables |
|
|
|
|
|
|
Commercial insurance loans |
0.5 |
0.3 |
0.3 |
0.7 |
98.2 |
100.0 |
Life insurance loans |
— |
— |
0.7 |
— |
99.3 |
100.0 |
PCI - life insurance loans (1) |
— |
— |
— |
— |
100.0 |
100.0 |
Consumer and other |
0.2 |
0.1 |
0.2 |
0.6 |
98.9 |
100.0 |
Total loans, net of unearned income,
excluding covered loans |
0.5% |
0.1% |
0.3% |
0.5% |
98.6% |
100.0% |
Covered loans |
3.2 |
7.9 |
0.6 |
2.1 |
86.2 |
100.0 |
Total loans, net of unearned income |
0.5% |
0.3% |
0.3% |
0.5% |
98.4% |
100.0% |
Non-performing Assets, excluding covered assets
The following table sets forth Wintrust's non-performing assets
and troubled debt restructurings ("TDRs") performing under the
contractual terms of the loan agreement, excluding covered assets
and non-covered PCI loans, at the dates indicated.
|
March 31, |
December 31, |
March 31, |
(Dollars in thousands) |
2015 |
2014 |
2014 |
Loans past due greater than 90 days
and still accruing(1): |
|
|
|
Commercial |
$ — |
$ 474 |
$ 387 |
Commercial real-estate |
— |
— |
— |
Home equity |
— |
— |
— |
Residential real-estate |
— |
— |
— |
Premium finance receivables -
commercial |
8,062 |
7,665 |
6,808 |
Premium finance receivables - life
insurance |
— |
— |
— |
Consumer and other |
91 |
119 |
57 |
Total loans past due greater than 90 days
and still accruing |
8,153 |
8,258 |
7,252 |
Non-accrual loans(2): |
|
|
|
Commercial |
5,586 |
9,157 |
11,782 |
Commercial real-estate |
29,982 |
26,605 |
33,733 |
Home equity |
7,665 |
6,174 |
7,311 |
Residential real-estate |
14,248 |
15,502 |
14,385 |
Premium finance receivables -
commercial |
15,902 |
12,705 |
14,517 |
Premium finance receivables - life
insurance |
— |
— |
— |
Consumer and other |
236 |
277 |
1,144 |
Total non-accrual loans |
73,619 |
70,420 |
82,872 |
Total non-performing
loans: |
|
|
|
Commercial |
5,586 |
9,631 |
12,169 |
Commercial real-estate |
29,982 |
26,605 |
33,733 |
Home equity |
7,665 |
6,174 |
7,311 |
Residential real-estate |
14,248 |
15,502 |
14,385 |
Premium finance receivables -
commercial |
23,964 |
20,370 |
21,325 |
Premium finance receivables - life
insurance |
— |
— |
— |
Consumer and other |
327 |
395 |
1,201 |
Total non-performing loans |
$ 81,772 |
$ 78,677 |
$ 90,124 |
Other real estate owned |
33,131 |
36,419 |
47,656 |
Other real estate owned - from
acquisitions |
9,126 |
9,223 |
6,475 |
Other repossessed assets |
259 |
303 |
426 |
Total non-performing assets |
$ 124,288 |
$ 124,622 |
$ 144,681 |
TDRs performing under the contractual
terms of the loan agreement |
$ 54,687 |
$ 69,697 |
$ 74,622 |
Total non-performing loans by
category as a percent of its own respective category's
period-end balance: |
|
|
|
Commercial |
0.13% |
0.25% |
0.35% |
Commercial real-estate |
0.64 |
0.59 |
0.79 |
Home equity |
1.08 |
0.86 |
1.03 |
Residential real-estate |
2.87 |
3.21 |
3.37 |
Premium finance receivables -
commercial |
1.03 |
0.87 |
0.97 |
Premium finance receivables - life
insurance |
— |
— |
— |
Consumer and other |
0.25 |
0.26 |
0.75 |
Total loans, net of unearned income |
0.55% |
0.55% |
0.69% |
Total non-performing assets as a
percentage of total assets |
0.61% |
0.62% |
0.79% |
Allowance for loan losses as a
percentage of total non-performing loans |
115.50% |
116.56% |
102.39% |
|
|
|
|
(1) As of the dates
shown, no TDRs were past due greater than 90 days and still
accruing interest. |
(2) Non-accrual loans
included TDRs totaling $12.5 million, $12.6 million, and $17.9
million as of March 31, 2015, December 31, 2014, and
March 31, 2014, respectively. |
Non-performing Commercial and Commercial Real Estate
Commercial non-performing loans totaled $5.6 million as of
March 31, 2015 compared to $9.6 million as of
December 31, 2014 and $12.2 million as of March 31, 2014.
Commercial real estate non-performing loans totaled $30.0 million
as of March 31, 2015 compared to $26.6 million as of
December 31, 2014 and $33.7 million as of March 31,
2014.
Management is pursuing the resolution of all credits in this
category. At this time, management believes reserves are
appropriate to absorb inherent losses that are expected upon the
ultimate resolution of these credits.
Non-performing Residential Real Estate and Home Equity
Non-performing home equity and residential real estate loans
totaled $21.9 million as of March 31, 2015. The balance
remained relatively unchanged compared to December 31, 2014
and March 31, 2014. The March 31, 2015
non-performing balance is comprised of $14.2 million of residential
real estate (72 individual credits) and $7.7 million of home equity
loans (44 individual credits). On average, this is
approximately 8 non-performing residential real estate loans and
home equity loans per chartered bank within the Company. The
Company believes control and collection of these loans is very
manageable. At this time, management believes reserves are adequate
to absorb inherent losses that are expected upon the ultimate
resolution of these credits.
Non-performing Commercial Insurance Premium Finance
Receivables
The table below presents the level of non-performing property
and casualty premium finance receivables as of March 31, 2015,
December 31, 2014 and March 31, 2014 and the amount of
net charge-offs for the quarters then ended.
|
March 31, |
December 31, |
March 31, |
(Dollars in thousands) |
2015 |
2014 |
2014 |
Non-performing premium finance
receivables - commercial |
$ 23,964 |
$ 20,370 |
$ 21,325 |
- as a percent of premium finance
receivables - commercial outstanding |
1.03% |
0.87% |
0.97% |
Net charge-offs of premium finance
receivables - commercial |
$ 934 |
$ 1,244 |
$ 891 |
- annualized as a percent of average
premium finance receivables - commercial |
0.16% |
0.21% |
0.16% |
Fluctuations in this category may occur due to timing and nature
of account collections from insurance carriers. The Company's
underwriting standards, regardless of the condition of the economy,
have remained consistent. We anticipate that net charge-offs and
non-performing asset levels in the near term will continue to be at
levels that are within acceptable operating ranges for this
category of loans. Management is comfortable with administering the
collections at this level of non-performing property and casualty
premium finance receivables and believes reserves are adequate to
absorb inherent losses that are expected upon the ultimate
resolution of these credits.
Due to the nature of collateral for commercial premium finance
receivables, it customarily takes 60-150 days to convert the
collateral into cash. Accordingly, the level of non-performing
commercial premium finance receivables is not necessarily
indicative of the loss inherent in the portfolio. In the event of
default, Wintrust has the power to cancel the insurance policy and
collect the unearned portion of the premium from the insurance
carrier. In the event of cancellation, the cash returned in payment
of the unearned premium by the insurer should generally be
sufficient to cover the receivable balance, the interest and other
charges due. Due to notification requirements and processing time
by most insurance carriers, many receivables will become delinquent
beyond 90 days while the insurer is processing the return of the
unearned premium. Management continues to accrue interest until
maturity as the unearned premium is ordinarily sufficient to
pay-off the outstanding balance and contractual interest due.
Nonperforming Loans Rollforward
The table below presents a summary of the changes in the balance
of non-performing loans, excluding covered loans, for the periods
presented:
|
Three Months
Ended |
|
March 31, |
December 31, |
March 31, |
(Dollars in thousands) |
2015 |
2014 |
2014 |
Balance at beginning of period |
$ 78,677 |
$ 81,070 |
$ 103,334 |
Additions, net |
8,980 |
6,797 |
5,655 |
Return to performing status |
(716) |
(1,533) |
(1,973) |
Payments received |
(4,369) |
(3,426) |
(3,730) |
Transfer to OREO and other repossessed
assets |
(2,540) |
(866) |
(10,013) |
Charge-offs |
(1,801) |
(3,032) |
(4,774) |
Net change for niche loans (1) |
3,541 |
(333) |
1,625 |
Balance at end of
period |
$ 81,772 |
$ 78,677 |
$ 90,124 |
|
|
|
|
(1) This includes
activity for premium finance receivables and indirect consumer
loans. |
TDRs
The table below presents a summary of TDRs as of the respective
date, presented by loan category and accrual status:
|
March 31, |
December 31, |
March 31, |
(Dollars in thousands) |
2015 |
2014 |
2014 |
Accruing TDRs: |
|
|
|
Commercial |
$ 6,273 |
$ 6,654 |
$ 5,844 |
Commercial real estate |
45,417 |
60,120 |
64,726 |
Residential real estate and other |
2,997 |
2,923 |
4,052 |
Total accrual |
$ 54,687 |
$ 69,697 |
$ 74,622 |
Non-accrual TDRs: (1) |
|
|
|
Commercial |
$ 184 |
$ 922 |
$ 1,434 |
Commercial real estate |
8,229 |
7,503 |
14,774 |
Residential real estate and other |
4,118 |
4,153 |
1,687 |
Total non-accrual |
$ 12,531 |
$ 12,578 |
$ 17,895 |
Total TDRs: |
|
|
|
Commercial |
$ 6,457 |
$ 7,576 |
$ 7,278 |
Commercial real estate |
53,646 |
67,623 |
79,500 |
Residential real estate and other |
7,115 |
7,076 |
5,739 |
Total TDRs |
$ 67,218 |
$ 82,275 |
$ 92,517 |
Weighted-average contractual interest
rate of TDRs |
4.04% |
4.09% |
4.02% |
|
|
|
|
(1) Included in total
non-performing loans. |
At March 31, 2015, the Company had $67.2 million in loans
modified in TDRs. The $67.2 million in TDRs represents 125
credits in which economic concessions were granted to certain
borrowers to better align the terms of their loans with their
current ability to pay. The balance decreased from $82.3
million representing 145 credits at December 31, 2014 and
decreased from $92.5 million representing 143 credits at
March 31, 2014.
The table below presents a summary of TDRs as of March 31,
2015 and March 31, 2014, and shows the changes in the balance
during the periods presented:
Three Months Ended March 31, 2015
|
|
|
Residential |
|
|
|
Commercial |
Real Estate |
|
(Dollars in thousands) |
Commercial |
Real Estate |
and Other |
Total |
Balance at beginning of period |
$ 7,576 |
$ 67,623 |
$ 7,076 |
$ 82,275 |
Additions during the period |
— |
— |
294 |
294 |
Reductions: |
|
|
|
|
Charge-offs |
(397) |
(1) |
(33) |
(431) |
Transferred to OREO and other repossessed
assets |
(562) |
(1,519) |
— |
(2,081) |
Removal of TDR loan status (1) |
(76) |
(8,382) |
— |
(8,458) |
Payments received, net |
(84) |
(4,075) |
(222) |
(4,381) |
Balance at period end |
$ 6,457 |
$ 53,646 |
$ 7,115 |
$ 67,218 |
Three Months Ended March 31, 2014
|
|
|
Residential |
|
|
|
Commercial |
Real Estate |
|
(Dollars in thousands) |
Commercial |
Real Estate |
and Other |
Total |
Balance at beginning of period |
$ 7,388 |
$ 93,535 |
$ 6,180 |
$ 107,103 |
Additions during the period |
88 |
5,157 |
— |
5,245 |
Reductions: |
|
|
|
|
Charge-offs |
(6) |
(3,713) |
(406) |
(4,125) |
Transferred to OREO and other repossessed
assets |
— |
(12,277) |
— |
(12,277) |
Removal of TDR loan status (1) |
— |
— |
— |
— |
Payments received, net |
(192) |
(3,202) |
(35) |
(3,429) |
Balance at period end |
$ 7,278 |
$ 79,500 |
$ 5,739 |
$ 92,517 |
Each TDR was reviewed for impairment at March 31, 2015 and
approximately $866,000 of impairment was present and appropriately
reserved for through the Company's normal reserving methodology in
the Company's allowance for loan losses. For TDRs in which
impairment is calculated by the present value of future cash flows,
the Company records interest income representing the decrease in
impairment resulting from the passage of time during the respective
period, which differs from interest income from contractually
required interest on these specific loans. For the three
months ended March 31, 2015 and 2014, the Company recorded
$193,000 and $132,000, respectively, in interest income
representing this decrease in impairment.
Other Real Estate Owned
The table below presents a summary of other real estate owned,
excluding covered other real estate owned, as of March 31,
2015, December 31, 2014 and March 31, 2014, and shows the
activity for the respective period and the balance for each
property type:
|
Three Months Ended |
|
March 31, |
December 31, |
March 31, |
(Dollars in thousands) |
2015 |
2014 |
2014 |
Balance at beginning of period |
$ 45,642 |
$ 50,377 |
$ 50,454 |
Disposals/resolved |
(6,846) |
(4,367) |
(8,205) |
Transfers in at fair value, less costs to
sell |
3,831 |
1,641 |
14,570 |
Additions from acquisition |
761 |
— |
— |
Fair value adjustments |
(1,131) |
(2,009) |
(2,688) |
Balance at end of period |
$ 42,257 |
$ 45,642 |
$ 54,131 |
|
|
|
|
|
Period End |
|
March 31, |
December 31, |
March 31, |
Balance by Property
Type |
2015 |
2014 |
2014 |
Residential real estate |
$ 7,250 |
$ 7,779 |
$ 6,452 |
Residential real estate development |
2,687 |
3,245 |
3,500 |
Commercial real estate |
32,320 |
34,618 |
44,179 |
Total |
$ 42,257 |
$ 45,642 |
$ 54,131 |
Covered Assets
In conjunction with FDIC-assisted transactions, the Company
entered into loss share agreements with the FDIC. These agreements
cover realized losses on loans, foreclosed real estate and certain
other assets. These loss share assets are measured separately from
the loan portfolios because they are not contractually embedded in
the loans and are not transferable with the loans should the
Company choose to dispose of them. Fair values at the acquisition
dates were estimated based on projected cash flows available for
loss-share based on the credit adjustments estimated for each loan
pool and the loss share percentages. The loss share assets are also
separately measured from the related loans and foreclosed real
estate and recorded separately on the Consolidated Statements of
Condition. Subsequent to the acquisition date, reimbursements
received from the FDIC for actual incurred losses will reduce the
loss share assets. Additional expected losses, to the extent such
expected losses result in the recognition of an allowance for loan
losses, will increase the loss share assets. The loss share
agreements with the FDIC require the Company to reimburse the FDIC
in the event that actual losses on covered assets are lower than
the original loss estimates agreed upon with the FDIC with respect
of such assets in the loss share agreements. The allowance for loan
losses for loans acquired in FDIC-assisted transactions is
determined without giving consideration to the amounts recoverable
through loss share agreements (since the loss share agreements are
separately accounted for and thus presented "gross" on the balance
sheet). On the Consolidated Statements of Income, the provision for
credit losses is reported net of changes in the amount recoverable
under the loss share agreements. Reductions to expected losses, to
the extent such reductions to expected losses are the result of an
improvement to the actual or expected cash flows from the covered
assets, will reduce the loss share assets. The increases in cash
flows for the purchased loans are recognized as interest income
prospectively.
The following table provides a comparative analysis for the
period end balances of the covered asset components and any changes
in the allowance for covered loan losses.
|
March 31, |
December 31, |
March 31, |
(Dollars in thousands) |
2015 |
2014 |
2014 |
Period End Balances: |
|
|
|
Loans |
$ 209,694 |
$ 226,709 |
$ 312,478 |
Other real estate owned |
38,785 |
42,283 |
75,148 |
Other assets |
757 |
757 |
2,272 |
FDIC Indemnification asset |
10,224 |
11,846 |
60,298 |
Total covered assets |
$ 259,460 |
$ 281,595 |
$ 450,196 |
Allowance for Covered Loan Losses
Rollforward: |
|
|
|
Balance at beginning of quarter: |
$ 2,131 |
$ 2,655 |
$ 10,092 |
Provision for covered loan losses before
benefit attributable to FDIC loss share agreements |
(529) |
(3,059) |
(7,121) |
Benefit attributable to FDIC loss share
agreements |
423 |
2,448 |
5,697 |
Net provision for covered loan
losses |
(106) |
(611) |
(1,424) |
Decrease in FDIC indemnification
asset |
(423) |
(2,448) |
(5,697) |
Loans charged-off |
(237) |
(175) |
(2,864) |
Recoveries of loans charged-off |
513 |
2,710 |
3,340 |
Net recoveries |
276 |
2,535 |
476 |
Balance at end of quarter |
$ 1,878 |
$ 2,131 |
$ 3,447 |
Changes in Accretable Yield
The excess of cash flows expected to be collected over the
carrying value of loans accounted for under ASC 310-30 is referred
to as the accretable yield and is recognized in interest income
using an effective yield method over the remaining life of the pool
of loans. The accretable yield is affected by:
- Changes in interest rate indices for variable rate loans
accounted for under ASC 310-30 – Expected future cash flows are
based on the variable rates in effect at the time of the regular
evaluations of cash flows expected to be collected;
- Changes in prepayment assumptions – Prepayments affect the
estimated life of loans accounted for under ASC 310-30 which may
change the amount of interest income, and possibly principal,
expected to be collected; and
- Changes in the expected principal and interest payments over
the estimated life – Updates to expected cash flows are driven by
the credit outlook and actions taken with borrowers. Changes in
expected future cash flows from loan modifications are included in
the regular evaluations of cash flows expected to be
collected.
The following table provides activity for the accretable yield
of loans accounted for under ASC 310-30.
|
Three Months
Ended |
Three Months Ended |
|
March 31,
2015 |
March 31, 2014 |
|
|
Life Insurance |
|
Life Insurance |
|
Bank |
Premium |
Bank |
Premium |
(Dollars in thousands) |
Acquisitions |
Finance Loans |
Acquisitions |
Finance Loans |
Accretable yield, beginning balance |
$ 77,485 |
$ 1,617 |
$ 107,655 |
$ 8,254 |
Acquisitions |
898 |
— |
— |
— |
Accretable yield amortized to interest
income |
(5,504) |
(601) |
(7,770) |
(1,771) |
Accretable yield amortized to indemnification
asset(1) |
(3,576) |
— |
(5,648) |
— |
Reclassification from non-accretable
difference(2) |
1,103 |
— |
8,580 |
— |
(Decreases) increases in interest cash flows
due to payments and changes in interest rates |
(1,224) |
— |
(5,143) |
78 |
Accretable yield, ending balance (3) |
$ 69,182 |
$ 1,016 |
$ 97,674 |
$ 6,561 |
|
|
|
|
|
(1) Represents the portion
of the current period accreted yield, resulting from lower expected
losses, applied to reduce the loss share indemnification
asset. |
(2) Reclassification is the
result of subsequent increases in expected principal cash
flows. |
(3) As of March 31, 2015,
the Company estimates that the remaining accretable yield balance
to be amortized to the indemnification asset for the bank
acquisitions is $15.8 million. The remainder of the accretable
yield related to bank acquisitions is expected to be amortized to
interest income. |
Accretion to interest income accounted for under ASC 310-30 from
loans acquired in bank acquisitions totaled $5.5 million and $7.8
million in the first quarter of 2015 and 2014, respectively. These
amounts include accretion from both covered and non-covered loans,
and are included together within interest and fees on loans in the
Consolidated Statements of Income.
Items Impacting Comparative Financial
Results:
Acquisitions
On January 16, 2015 the Company completed its acquisition of
Delavan Bancshares, Inc. ("Delavan"). Delavan was the parent
company of Community Bank CBD. Through this transaction, Town Bank
acquired four banking locations, approximately $256 million in
assets and approximately $170 million in deposits.
On August 8, 2014, the Company, through its subsidiary Town
Bank, completed its acquisition of certain branch offices and
deposits of Talmer Bank & Trust. Through this transaction, Town
Bank acquired 11 branch offices and approximately $355 million in
deposits.
On July 11, 2014, the Company, through its subsidiary Town Bank,
completed its acquisition of the Pewaukee, Wisconsin branch of THE
National Bank. In addition to the banking facility, Town Bank
acquired approximately $75 million in loans and approximately $36
million in deposits.
On May 16, 2014, the Company, through its subsidiary Hinsdale
Bank and Trust Company ("Hinsdale Bank"), completed its acquisition
of the Stone Park branch office and certain related deposits of
Urban Partnership Bank.
On April 28, 2014, the Company, through its subsidiary
First Insurance Funding of Canada, Inc., completed its acquisition
of 100% of the shares of each of Policy Billing Services Inc. and
Equity Premium Finance Inc., two affiliated Canadian insurance
premium funding and payment services companies.
On February 28, 2014, the Company, through its subsidiary Lake
Forest Bank and Trust Company ("Lake Forest Bank"), completed its
acquisition of a bank branch from Baytree National Bank & Trust
Company. In addition to the banking facility, Lake Forest Bank
acquired certain assets and approximately $15 million of
deposits.
Announced Acquisitions
On April 2, 2015, the Company announced the signing of a
definitive agreement to acquire Suburban Illinois Bancorp, Inc.
("Suburban"). Suburban is the parent company of Suburban Bank &
Trust Company ("SBT"). Through this transaction, the Company will
acquire SBT's ten banking locations in Chicago and its
suburbs. At December 31, 2014, SBT had approximately $470
million in assets, approximately $297 million in loans, and
approximately $411 million in deposits.
On March 30, 2015, the Company announced the signing of a
definitive agreement, through its subsidiary Wintrust Bank, to
acquire North Bank, headquartered in downtown Chicago, Illinois.
Through this transaction, Wintrust Bank will acquire two banking
locations. At December 31, 2014, North Bank approximately $108
million in assets, approximately $55 million in loans, and
approximately $96 million in deposits.
On March 2, 2015, the Company announced the signing of a
definitive agreement to acquire Community Financial Shares, Inc
("CFIS"). CFIS is the parent company of Community Bank -
Wheaton/Glen Ellyn ("CBWGE"). Through this transaction, the Company
will acquire CBWGE's four banking locations in Wheaton and Glen
Ellyn, Illinois. At December 31, 2014, CBWGE had approximately
$343 million in assets and approximately $310 million in
deposits.
WINTRUST SUBSIDIARIES AND LOCATIONS
Wintrust is a financial holding company whose common stock is
traded on the Nasdaq Global Select Market (Nasdaq:WTFC). Its 15
community bank subsidiaries are: Lake Forest Bank & Trust
Company, Hinsdale Bank & Trust Company, Wintrust Bank in
Chicago, Libertyville Bank & Trust Company, Barrington
Bank & Trust Company, N.A., Crystal Lake Bank &
Trust Company, N.A., Northbrook Bank & Trust Company,
Schaumburg Bank & Trust Company, N.A., Village
Bank & Trust in Arlington Heights, Beverly Bank &
Trust Company, N.A. in Chicago, Wheaton Bank & Trust
Company, State Bank of The Lakes in Antioch, Old Plank Trail
Community Bank, N.A. in New Lenox, St. Charles Bank &
Trust Company and Town Bank in Hartland, Wisconsin. The banks also
operate facilities in Illinois in Algonquin, Bloomingdale, Buffalo
Grove, Cary, Chicago, Clarendon Hills, Crete, Deerfield, Downers
Grove, Elgin, Evergreen Park, Frankfort, Geneva, Glen Ellyn,
Glencoe, Glenview, Gurnee, Grayslake, Hanover Park, Highland Park,
Highwood, Hoffman Estates, Island Lake, Itasca, Joliet, Lake Bluff,
Lake Villa, Lansing, Lindenhurst, Lynwood, McHenry, Mokena, Mount
Prospect, Mundelein, Naperville, North Chicago, Northfield,
Norridge, Orland Park, Palatine, Park Ridge, Plainfield, Prospect
Heights, Ravinia, Riverside, Rogers Park, Roselle, Shorewood,
Skokie, South Holland, Spring Grove, Steger, Stone Park, Vernon
Hills, Wauconda, Western Springs, Willowbrook, Wilmette, Winnetka
and Wood Dale and in Albany, Burlington, Clinton, Darlington,
Delafield, Delavan, Elm Grove, Genoa City, Kenosha, Lake Geneva,
Madison, Menomenee Falls, Monroe, Pewaukee, Sharon, Wales, Walworth
and Wind Lake, Wisconsin and Dyer, Indiana.
Additionally, the Company operates various non-bank business
units:
- First Insurance Funding Corporation, one of the largest
insurance premium finance companies operating in the United States,
serves commercial and life insurance loan customers throughout the
country.
- First Insurance Funding of Canada serves commercial insurance
loan customers throughout Canada
- Tricom, Inc. of Milwaukee provides high-yielding, short-term
accounts receivable financing and value-added out-sourced
administrative services, such as data processing of payrolls,
billing and cash management services, to temporary staffing service
clients located throughout the United States.
- Wintrust Mortgage, a division of Barrington Bank &
Trust Company, engages primarily in the origination and purchase of
residential mortgages for sale into the secondary market through
origination offices located throughout the United States. Loans are
also originated nationwide through relationships with wholesale and
correspondent offices.
- Wayne Hummer Investments, LLC is a broker-dealer providing a
full range of private client and brokerage services to clients and
correspondent banks located primarily in the Midwest.
- Great Lakes Advisors LLC provides money management services and
advisory services to individual accounts.
- The Chicago Trust Company, a trust subsidiary, allows Wintrust
to service customers' trust and investment needs at each banking
location.
FORWARD-LOOKING STATEMENTS
This document contains forward-looking statements within the
meaning of federal securities laws. Forward-looking information can
be identified through the use of words such as "intend," "plan,"
"project," "expect," "anticipate," "believe," "estimate,"
"contemplate," "possible," "point," "will," "may," "should,"
"would" and "could." Forward-looking statements and information are
not historical facts, are premised on many factors and assumptions,
and represent only management's expectations, estimates and
projections regarding future events. Similarly, these statements
are not guarantees of future performance and involve certain risks
and uncertainties that are difficult to predict, which may include,
but are not limited to, those listed below and the Risk Factors
discussed under Item 1A of the Company's 2014 Annual Report on
Form 10-K and in any of the Company's subsequent SEC filings. The
Company intends such forward-looking statements to be covered by
the safe harbor provisions for forward-looking statements contained
in the Private Securities Litigation Reform Act of 1995, and is
including this statement for purposes of invoking these safe harbor
provisions. Such forward-looking statements may be deemed to
include, among other things, statements relating to the Company's
future financial performance, the performance of its loan
portfolio, the expected amount of future credit reserves and
charge-offs, delinquency trends, growth plans, regulatory
developments, securities that the Company may offer from time to
time, and management's long-term performance goals, as well as
statements relating to the anticipated effects on financial
condition and results of operations from expected developments or
events, the Company's business and growth strategies, including
future acquisitions of banks, specialty finance or wealth
management businesses, internal growth and plans to form additional
de novo banks or branch offices. Actual results could differ
materially from those addressed in the forward-looking statements
as a result of numerous factors, including the following:
- negative economic conditions that adversely affect the economy,
housing prices, the job market and other factors that may affect
the Company's liquidity and the performance of its loan portfolios,
particularly in the markets in which it operates;
- the extent of defaults and losses on the Company's loan
portfolio, which may require further increases in its allowance for
credit losses;
- estimates of fair value of certain of the Company's assets and
liabilities, which could change in value significantly from period
to period;
- the financial success and economic viability of the borrowers
of our commercial loans;
- market conditions in the commercial real estate market in the
Chicago metropolitan area and southern Wisconsin;
- the extent of commercial and consumer delinquencies and
declines in real estate values, which may require further increases
in the Company's allowance for loan and lease losses;
- inaccurate assumptions in our analytical and forecasting models
used to manage our loan portfolio;
- changes in the level and volatility of interest rates, the
capital markets and other market indices that may affect, among
other things, the Company's liquidity and the value of its assets
and liabilities;
- competitive pressures in the financial services business which
may affect the pricing of the Company's loan and deposit products
as well as its services (including wealth management
services);
- failure to identify and complete favorable acquisitions in the
future or unexpected difficulties or developments related to the
integration of the Company's recent or future acquisitions;
- unexpected difficulties and losses related to FDIC-assisted
acquisitions, including those resulting from our loss-sharing
arrangements with the FDIC;
- any negative perception of the Company's reputation or
financial strength;
- ability to raise additional capital on acceptable terms when
needed;
- disruption in capital markets, which may lower fair values for
the Company's investment portfolio;
- ability to use technology to provide products and services that
will satisfy customer demands and create efficiencies in
operations;
- adverse effects on our information technology systems resulting
from failures, human error or tampering;
- adverse effects of failures by our vendors to provide agreed
upon services in the manner and at the cost agreed, particularly
our information technology vendors;
- increased costs as a result of protecting our customers from
the impact of stolen debit card information;
- accuracy and completeness of information the Company receives
about customers and counterparties to make credit decisions;
- ability of the Company to attract and retain senior management
experienced in the banking and financial services industries;
- environmental liability risk associated with lending
activities;
- the impact of any claims or legal actions, including any effect
on our reputation;
- losses incurred in connection with repurchases and
indemnification payments related to mortgages;
- the loss of customers as a result of technological changes
allowing consumers to complete their financial transactions without
the use of a bank;
- the soundness of other financial institutions;
- the expenses and delayed returns inherent in opening new
branches and de novo banks;
- examinations and challenges by tax authorities;
- changes in accounting standards, rules and interpretations and
the impact on the Company's financial statements;
- the ability of the Company to receive dividends from its
subsidiaries;
- a decrease in the Company's regulatory capital ratios,
including as a result of further declines in the value of its loan
portfolios, or otherwise;
- legislative or regulatory changes, particularly changes in
regulation of financial services companies and/or the products and
services offered by financial services companies, including those
resulting from the Dodd-Frank Act;
- a lowering of our credit rating;
- changes in U.S. monetary policy;
- restrictions upon our ability to market our products to
consumers and limitations on our ability to profitably operate our
mortgage business resulting from the Dodd-Frank Act;
- increased costs of compliance, heightened regulatory capital
requirements and other risks associated with changes in regulation
and the current regulatory environment, including the Dodd-Frank
Act;
- the impact of heightened capital requirements;
- increases in the Company's FDIC insurance premiums, or the
collection of special assessments by the FDIC;
- delinquencies or fraud with respect to the Company's premium
finance business;
- credit downgrades among commercial and life insurance providers
that could negatively affect the value of collateral securing the
Company's premium finance loans;
- the Company's ability to comply with covenants under its credit
facility; and
- fluctuations in the stock market, which may have an adverse
impact on the Company's wealth management business and brokerage
operation.
Therefore, there can be no assurances that future actual results
will correspond to these forward-looking statements. The reader is
cautioned not to place undue reliance on any forward-looking
statement made by the Company. Any such statement speaks only as of
the date the statement was made or as of such date that may be
referenced within the statement. The Company undertakes no
obligation to update any forward-looking statement to reflect the
impact of circumstances after the date of the press release.
Persons are advised, however, to consult further disclosures
management makes on related subjects in its reports filed with the
Securities and Exchange Commission and in its press releases.
CONFERENCE CALL, WEB CAST AND REPLAY
The Company will hold a conference call at 1:00 p.m. (CT)
Thursday, April 16, 2015 regarding first quarter 2015 results.
Individuals interested in listening should call (877) 363-5049
and enter Conference ID #21431224. A simultaneous audio-only web
cast and replay of the conference call may be accessed via the
Company's web site at (http://www.wintrust.com), Investor
Relations, Investor News and Events, Presentations &
Conference Calls. The text of the first quarter 2015 earnings press
release will be available on the home page of the Company's website
at (http://www.wintrust.com) and at the Investor Relations,
Investor News and Events, Press Releases link on its website.
WINTRUST FINANCIAL
CORPORATION
Supplemental Financial
Information
5 Quarter Trends
WINTRUST FINANCIAL
CORPORATION - Supplemental Financial Information |
Selected Financial
Highlights - 5 Quarter Trends |
(Dollars in thousands,
except per share data) |
|
|
Three Months Ended |
|
March 31, |
December 31, |
September 30, |
June 30, |
March 31, |
|
2015 |
2014 |
2014 |
2014 |
2014 |
Selected Financial Condition Data (at
end of period): |
|
|
|
|
|
Total assets |
$ 20,382,271 |
$ 20,010,727 |
$ 19,169,345 |
$ 18,895,681 |
$ 18,221,163 |
Total loans, excluding loans held-for-sale
and covered loans |
14,953,059 |
14,409,398 |
14,052,059 |
13,749,996 |
13,133,160 |
Total deposits |
16,938,769 |
16,281,844 |
16,065,246 |
15,556,376 |
15,129,045 |
Junior subordinated debentures |
249,493 |
249,493 |
249,493 |
249,493 |
249,493 |
Total shareholders' equity |
2,131,074 |
2,069,822 |
2,028,508 |
1,998,235 |
1,940,143 |
Selected Statements of Income
Data: |
|
|
|
|
|
Net interest income |
151,891 |
153,719 |
151,670 |
149,180 |
144,006 |
Net revenue (1) |
216,432 |
211,376 |
209,622 |
203,282 |
189,535 |
Net income |
39,052 |
38,133 |
40,224 |
38,541 |
34,500 |
Net income per common share – Basic |
$ 0.79 |
$ 0.78 |
$ 0.83 |
$ 0.79 |
$ 0.71 |
Net income per common share – Diluted |
$ 0.76 |
$ 0.75 |
$ 0.79 |
$ 0.76 |
$ 0.68 |
Selected Financial Ratios and Other
Data: |
|
|
|
|
|
Performance Ratios: |
|
|
|
|
|
Net interest margin (2) |
3.42% |
3.46% |
3.46% |
3.62% |
3.61% |
Non-interest income to average assets |
1.32% |
1.18% |
1.20% |
1.19% |
1.03% |
Non-interest expense to average assets |
3.01% |
2.94% |
2.87% |
2.93% |
2.96% |
Net overhead ratio (2) (3) |
1.69% |
1.76% |
1.67% |
1.74% |
1.93% |
Efficiency ratio - FTE (2) (4) |
67.90% |
67.59% |
65.76% |
65.36% |
69.02% |
Return on average assets |
0.80% |
0.78% |
0.83% |
0.84% |
0.78% |
Return on average common equity |
7.64% |
7.51% |
8.09% |
8.03% |
7.43% |
Return on average tangible common equity |
9.96% |
9.82% |
10.59% |
10.43% |
9.71% |
Average total assets |
$ 19,826,240 |
$ 19,366,670 |
$ 19,127,346 |
$ 18,302,942 |
$ 17,980,943 |
Average total shareholders' equity |
2,114,356 |
2,057,855 |
2,020,903 |
1,971,656 |
1,923,649 |
Average loans to average deposits ratio |
91.4% |
89.5% |
90.1% |
90.4% |
89.4% |
Average loans to average deposits ratio
(including covered loans) |
92.7 |
91.0 |
91.8 |
92.3 |
91.6 |
Common Share Data at end of period: |
|
|
|
|
|
Market price per common share |
$ 47.68 |
$ 46.76 |
$ 44.67 |
$ 46.00 |
$ 48.66 |
Book value per common share (2) |
$ 42.30 |
$ 41.52 |
$ 40.74 |
$ 40.21 |
$ 39.21 |
Tangible common book value per share (2) |
$ 33.04 |
$ 32.45 |
$ 31.60 |
$ 31.64 |
$ 30.74 |
Common shares outstanding |
47,389,608 |
46,805,055 |
46,691,047 |
46,552,905 |
46,258,960 |
Other Data at end of period:(8) |
|
|
|
|
|
Leverage Ratio(5) |
9.2% |
10.2% |
10.0% |
10.5% |
10.4% |
Tier 1 Capital to risk-weighted assets
(5) |
10.1% |
11.6% |
11.7% |
11.7% |
12.0% |
Common equity Tier 1 capital to risk-weighted
assets (5) |
9.0% |
N/A |
N/A |
N/A |
N/A |
Total capital to risk-weighted assets
(5) |
12.5% |
13.0% |
13.1% |
13.2% |
12.6% |
Tangible common equity ratio (TCE) (2)
(7) |
7.9% |
7.8% |
7.9% |
8.0% |
8.0% |
Tangible common equity ratio, assuming full
conversion of preferred stock (2) (7) |
8.5% |
8.4% |
8.6% |
8.7% |
8.7% |
Allowance for credit losses (6) |
$ 95,334 |
$ 92,480 |
$ 91,841 |
$ 93,137 |
$ 93,012 |
Non-performing loans |
81,772 |
78,677 |
81,070 |
88,650 |
90,124 |
Allowance for credit losses to total loans
(6) |
0.64% |
0.64% |
0.65% |
0.68% |
0.71% |
Non-performing loans to total loans |
0.55% |
0.55% |
0.58% |
0.64% |
0.69% |
Number of: |
|
|
|
|
|
Bank subsidiaries |
15 |
15 |
15 |
15 |
15 |
Banking offices |
146 |
140 |
139 |
127 |
126 |
|
|
|
|
|
|
(1) Net revenue
includes net interest income and non-interest income |
(2) See "Supplemental
Financial Measures/Ratios" for additional information on this
performance measure/ratio. |
(3) The net overhead
ratio is calculated by netting total non-interest expense and total
non-interest income, annualizing this amount, and dividing by that
period's total average assets. A lower ratio indicates a higher
degree of efficiency. |
(4) The efficiency
ratio is calculated by dividing total non-interest expense by
tax-equivalent net revenue (less securities gains or losses). A
lower ratio indicates more efficient revenue generation. |
(5) Capital ratios for
current quarter-end are estimated. As of January 1, 2015 capital
ratios are calculated under the requirements of Basel III. |
(6) The allowance for
credit losses includes both the allowance for loan losses and the
allowance for unfunded lending-related commitments, but excluding
the allowance for covered loan losses. |
(7) Total shareholders'
equity minus preferred stock and total intangible assets divided by
total assets minus total intangible assets |
(8) Asset quality
ratios exclude covered loans. |
|
|
|
|
|
|
WINTRUST FINANCIAL
CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION |
Consolidated Statements
of Condition - 5 Quarter Trends |
|
|
(Unaudited) |
|
(Unaudited) |
(Unaudited) |
(Unaudited) |
|
March 31, |
December 31, |
September 30, |
June 30, |
March 31, |
(In thousands) |
2015 |
2014 |
2014 |
2014 |
2014 |
Assets |
|
|
|
|
|
Cash and due from banks |
$ 286,743 |
$ 225,136 |
$ 260,694 |
$ 349,013 |
$ 330,262 |
Federal funds sold and securities purchased
under resale agreements |
4,129 |
5,571 |
26,722 |
7,965 |
12,476 |
Interest bearing deposits with banks |
697,799 |
998,437 |
620,370 |
506,871 |
540,964 |
Available-for-sale securities, at fair
value |
1,721,030 |
1,792,078 |
1,782,648 |
1,824,240 |
1,949,697 |
Trading account securities |
7,811 |
1,206 |
6,015 |
2,234 |
1,068 |
Federal Home Loan Bank and Federal Reserve
Bank stock |
92,948 |
91,582 |
80,951 |
84,531 |
78,524 |
Brokerage customer receivables |
25,287 |
24,221 |
26,624 |
28,199 |
26,884 |
Mortgage loans held-for-sale |
446,355 |
351,290 |
363,303 |
363,627 |
215,231 |
Loans, net of unearned income, excluding
covered loans |
14,953,059 |
14,409,398 |
14,052,059 |
13,749,996 |
13,133,160 |
Covered loans |
209,694 |
226,709 |
254,605 |
275,154 |
312,478 |
Total loans |
15,162,753 |
14,636,107 |
14,306,664 |
14,025,150 |
13,445,638 |
Less: Allowance for loan losses |
94,446 |
91,705 |
91,019 |
92,253 |
92,275 |
Less: Allowance for covered loan
losses |
1,878 |
2,131 |
2,655 |
1,667 |
3,447 |
Net loans |
15,066,429 |
14,542,271 |
14,212,990 |
13,931,230 |
13,349,916 |
Premises and equipment, net |
559,281 |
555,228 |
555,241 |
535,281 |
531,763 |
FDIC indemnification asset |
10,224 |
11,846 |
27,359 |
46,115 |
60,298 |
Accrued interest receivable and other
assets |
537,117 |
501,882 |
494,213 |
525,394 |
549,705 |
Trade date securities receivable |
488,063 |
485,534 |
285,627 |
292,366 |
182,600 |
Goodwill |
420,197 |
405,634 |
406,604 |
381,721 |
373,725 |
Other intangible assets |
18,858 |
18,811 |
19,984 |
16,894 |
18,050 |
Total assets |
$ 20,382,271 |
$ 20,010,727 |
$ 19,169,345 |
$ 18,895,681 |
$ 18,221,163 |
Liabilities and Shareholders'
Equity |
|
|
|
|
|
Deposits: |
|
|
|
|
|
Non-interest bearing |
$ 3,779,609 |
$ 3,518,685 |
$ 3,253,477 |
$ 3,072,430 |
$ 2,773,922 |
Interest bearing |
13,159,160 |
12,763,159 |
12,811,769 |
12,483,946 |
12,355,123 |
Total deposits |
16,938,769 |
16,281,844 |
16,065,246 |
15,556,376 |
15,129,045 |
Federal Home Loan Bank advances |
416,036 |
733,050 |
347,500 |
580,582 |
387,672 |
Other borrowings |
187,006 |
196,465 |
51,483 |
43,716 |
231,086 |
Subordinated notes |
140,000 |
140,000 |
140,000 |
140,000 |
— |
Junior subordinated debentures |
249,493 |
249,493 |
249,493 |
249,493 |
249,493 |
Trade date securities payable |
2,929 |
3,828 |
— |
— |
— |
Accrued interest payable and other
liabilities |
316,964 |
336,225 |
287,115 |
327,279 |
283,724 |
Total liabilities |
18,251,197 |
17,940,905 |
17,140,837 |
16,897,446 |
16,281,020 |
Shareholders' Equity: |
|
|
|
|
|
Preferred stock |
126,427 |
126,467 |
126,467 |
126,467 |
126,477 |
Common stock |
47,475 |
46,881 |
46,766 |
46,627 |
46,332 |
Surplus |
1,156,542 |
1,133,955 |
1,129,975 |
1,125,551 |
1,122,233 |
Treasury stock |
(3,948) |
(3,549) |
(3,519) |
(3,449) |
(3,380) |
Retained earnings |
835,669 |
803,400 |
771,519 |
737,542 |
705,234 |
Accumulated other comprehensive loss |
(31,091) |
(37,332) |
(42,700) |
(34,503) |
(56,753) |
Total shareholders' equity |
2,131,074 |
2,069,822 |
2,028,508 |
1,998,235 |
1,940,143 |
Total liabilities and
shareholders' equity |
$ 20,382,271 |
$ 20,010,727 |
$ 19,169,345 |
$ 18,895,681 |
$ 18,221,163 |
|
|
|
|
|
|
WINTRUST FINANCIAL
CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION |
Consolidated Statements
of Income (Unaudited) - 5 Quarter Trends |
|
|
Three Months Ended |
|
March 31, |
December 31, |
September 30, |
June 30, |
March 31, |
(In thousands, except per share data) |
2015 |
2014 |
2014 |
2014 |
2014 |
Interest income |
|
|
|
|
|
Interest and fees on loans |
$ 154,676 |
$ 157,476 |
$ 156,534 |
$ 151,984 |
$ 147,030 |
Interest bearing deposits with banks |
316 |
495 |
409 |
319 |
249 |
Federal funds sold and securities
purchased under resale agreements |
2 |
3 |
12 |
6 |
4 |
Available-for-sale securities |
14,400 |
13,761 |
12,767 |
13,309 |
13,114 |
Trading account securities |
13 |
45 |
20 |
5 |
9 |
Federal Home Loan Bank and Federal
Reserve Bank stock |
769 |
749 |
733 |
727 |
711 |
Brokerage customer receivables |
181 |
186 |
201 |
200 |
209 |
Total interest income |
170,357 |
172,715 |
170,676 |
166,550 |
161,326 |
Interest expense |
|
|
|
|
|
Interest on deposits |
11,814 |
12,431 |
12,298 |
11,759 |
11,923 |
Interest on Federal Home Loan Bank
advances |
2,156 |
2,534 |
2,641 |
2,705 |
2,643 |
Interest on other borrowings |
788 |
313 |
200 |
510 |
750 |
Interest on subordinated notes |
1,775 |
1,776 |
1,776 |
354 |
— |
Interest on junior subordinated
debentures |
1,933 |
1,942 |
2,091 |
2,042 |
2,004 |
Total interest expense |
18,466 |
18,996 |
19,006 |
17,370 |
17,320 |
Net interest income |
151,891 |
153,719 |
151,670 |
149,180 |
144,006 |
Provision for credit losses |
6,079 |
6,133 |
5,864 |
6,660 |
1,880 |
Net interest income after provision for
credit losses |
145,812 |
147,586 |
145,806 |
142,520 |
142,126 |
Non-interest income |
|
|
|
|
|
Wealth management |
18,100 |
18,649 |
17,659 |
18,222 |
16,813 |
Mortgage banking |
27,800 |
24,694 |
26,691 |
23,804 |
16,428 |
Service charges on deposit accounts |
6,297 |
6,189 |
6,084 |
5,688 |
5,346 |
Gains (losses) on available-for-sale
securities, net |
524 |
18 |
(153) |
(336) |
(33) |
Fees from covered call options |
4,360 |
2,966 |
2,107 |
1,244 |
1,542 |
Trading (losses) gains, net |
(477) |
(507) |
293 |
(743) |
(652) |
Other |
7,937 |
5,648 |
5,271 |
6,223 |
6,085 |
Total non-interest income |
64,541 |
57,657 |
57,952 |
54,102 |
45,529 |
Non-interest expense |
|
|
|
|
|
Salaries and employee benefits |
90,130 |
87,633 |
85,976 |
81,963 |
79,934 |
Equipment |
7,836 |
7,555 |
7,570 |
7,223 |
7,403 |
Occupancy, net |
12,351 |
11,600 |
10,446 |
9,850 |
10,993 |
Data processing |
5,448 |
5,313 |
4,765 |
4,543 |
4,715 |
Advertising and marketing |
3,907 |
3,669 |
3,528 |
3,558 |
2,816 |
Professional fees |
4,664 |
4,039 |
4,035 |
4,046 |
3,454 |
Amortization of other intangible
assets |
1,013 |
1,171 |
1,202 |
1,156 |
1,163 |
FDIC insurance |
2,987 |
2,810 |
3,211 |
3,196 |
2,951 |
OREO expense, net |
1,411 |
2,320 |
581 |
2,490 |
3,976 |
Other |
17,571 |
17,331 |
17,186 |
15,566 |
13,910 |
Total non-interest expense |
147,318 |
143,441 |
138,500 |
133,591 |
131,315 |
Income before taxes |
63,035 |
61,802 |
65,258 |
63,031 |
56,340 |
Income tax expense |
23,983 |
23,669 |
25,034 |
24,490 |
21,840 |
Net income |
$ 39,052 |
$ 38,133 |
$ 40,224 |
$ 38,541 |
$ 34,500 |
Preferred stock dividends and discount
accretion |
1,581 |
1,580 |
1,581 |
1,581 |
1,581 |
Net income applicable to common
shares |
$ 37,471 |
$ 36,553 |
$ 38,643 |
$ 36,960 |
$ 32,919 |
Net income per common share -
Basic |
$ 0.79 |
$ 0.78 |
$ 0.83 |
$ 0.79 |
$ 0.71 |
Net income per common share -
Diluted |
$ 0.76 |
$ 0.75 |
$ 0.79 |
$ 0.76 |
$ 0.68 |
Cash dividends declared per common
share |
$ 0.11 |
$ 0.10 |
$ 0.10 |
$ 0.10 |
$ 0.10 |
Weighted average common shares
outstanding |
47,239 |
46,734 |
46,639 |
46,520 |
46,195 |
Dilutive potential common shares |
4,233 |
4,243 |
4,241 |
4,402 |
4,509 |
Average common shares and dilutive common
shares |
51,472 |
50,977 |
50,880 |
50,922 |
50,704 |
|
|
|
|
|
|
WINTRUST FINANCIAL
CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION |
Period End Loan Balances
- 5 Quarter Trends |
|
|
|
March 31, |
December 31, |
September 30, |
June 30, |
March 31, |
(Dollars in thousands) |
2015 |
2014 |
2014 |
2014 |
2014 |
Balance: |
|
|
|
|
|
Commercial |
$ 4,211,932 |
$ 3,924,394 |
$ 3,689,671 |
$ 3,640,430 |
$ 3,439,197 |
Commercial real estate |
4,710,486 |
4,505,753 |
4,510,375 |
4,353,472 |
4,262,255 |
Home equity |
709,283 |
716,293 |
720,058 |
713,642 |
707,748 |
Residential real-estate |
495,925 |
483,542 |
470,319 |
451,905 |
426,769 |
Premium finance receivables -
commercial |
2,319,623 |
2,350,833 |
2,377,892 |
2,378,529 |
2,208,361 |
Premium finance receivables - life
insurance |
2,375,654 |
2,277,571 |
2,134,405 |
2,051,645 |
1,929,334 |
Consumer and other (1) |
130,156 |
151,012 |
149,339 |
160,373 |
159,496 |
Total loans, net of unearned income,
excluding covered loans |
$ 14,953,059 |
$ 14,409,398 |
$ 14,052,059 |
$ 13,749,996 |
$ 13,133,160 |
Covered loans |
209,694 |
226,709 |
254,605 |
275,154 |
312,478 |
Total loans, net of unearned income |
$ 15,162,753 |
$ 14,636,107 |
$ 14,306,664 |
$ 14,025,150 |
$ 13,445,638 |
Mix: |
|
|
|
|
|
Commercial |
28% |
26% |
26% |
26% |
26% |
Commercial real estate |
31 |
31 |
31 |
31 |
32 |
Home equity |
5 |
5 |
5 |
5 |
5 |
Residential real-estate |
3 |
3 |
3 |
3 |
3 |
Premium finance receivables -
commercial |
15 |
16 |
17 |
17 |
17 |
Premium finance receivables - life
insurance |
16 |
16 |
15 |
15 |
14 |
Consumer and other (1) |
1 |
1 |
1 |
1 |
1 |
Total loans, net of unearned income,
excluding covered loans |
99% |
98% |
98% |
98% |
98% |
Covered loans |
1 |
2 |
2 |
2 |
2 |
Total loans, net of unearned income |
100% |
100% |
100% |
100% |
100% |
|
|
|
|
|
|
(1) Includes autos,
boats, snowmobiles and other indirect consumer loans. |
|
|
|
|
|
|
WINTRUST FINANCIAL
CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION |
Period End Deposits
Balances - 5 Quarter Trends |
|
|
|
March 31, |
December 31, |
September 30, |
June 30, |
March 31, |
(Dollars in thousands) |
2015 |
2014 |
2014 |
2014 |
2014 |
Balance: |
|
|
|
|
|
Non-interest bearing |
$ 3,779,609 |
$ 3,518,685 |
$ 3,253,477 |
$ 3,072,430 |
$ 2,773,922 |
NOW and interest bearing demand
deposits |
2,262,928 |
2,236,089 |
2,086,099 |
2,002,868 |
1,983,251 |
Wealth Management deposits (1) |
1,528,963 |
1,226,916 |
1,212,317 |
1,220,102 |
1,289,134 |
Money Market |
3,791,762 |
3,651,467 |
3,744,682 |
3,591,540 |
3,454,271 |
Savings |
1,563,752 |
1,508,877 |
1,465,250 |
1,427,222 |
1,443,943 |
Time certificates of deposit |
4,011,755 |
4,139,810 |
4,303,421 |
4,242,214 |
4,184,524 |
Total deposits |
$ 16,938,769 |
$ 16,281,844 |
$ 16,065,246 |
$ 15,556,376 |
$ 15,129,045 |
Mix: |
|
|
|
|
|
Non-interest bearing |
22% |
22% |
20% |
20% |
18% |
NOW and interest bearing demand
deposits |
13 |
14 |
13 |
13 |
13 |
Wealth Management deposits (1) |
9 |
8 |
8 |
8 |
8 |
Money Market |
23 |
22 |
23 |
23 |
23 |
Savings |
9 |
9 |
9 |
9 |
10 |
Time certificates of deposit |
24 |
25 |
27 |
27 |
28 |
Total deposits |
100% |
100% |
100% |
100% |
100% |
|
|
|
|
|
|
(1) Represents deposit
balances of the Company's subsidiary banks from brokerage customers
of Wayne Hummer Investments, trust and asset management customers
of The Chicago Trust Company and brokerage customers from
unaffiliated companies which have been placed into deposit accounts
of the Banks. |
|
|
|
|
|
|
WINTRUST FINANCIAL
CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION |
Net Interest Margin
(Including Call Option Income) - 5 Quarter Trends |
|
|
Three Months Ended |
|
March 31, |
December 31, |
September 30, |
June 30, |
March 31, |
(Dollars in thousands) |
2015 |
2014 |
2014 |
2014 |
2014 |
Net interest income |
$ 152,952 |
$ 154,599 |
$ 152,498 |
$ 149,952 |
$ 144,696 |
Call option income |
4,360 |
2,966 |
2,107 |
1,244 |
1,542 |
Net interest income including call option
income |
$ 157,312 |
$ 157,565 |
$ 154,605 |
$ 151,196 |
$ 146,238 |
Yield on earning assets |
3.83% |
3.89% |
3.90% |
4.03% |
4.04% |
Rate on interest-bearing liabilities |
0.54 |
0.55 |
0.56 |
0.53 |
0.54 |
Rate spread |
3.29% |
3.34% |
3.34% |
3.50% |
3.50% |
Net free funds contribution |
0.13 |
0.12 |
0.12 |
0.12 |
0.11 |
Net interest margin |
3.42 |
3.46 |
3.46 |
3.62 |
3.61 |
Call option income |
0.10 |
0.07 |
0.05 |
0.03 |
0.04 |
Net interest margin including call option
income |
3.52% |
3.53% |
3.51% |
3.65% |
3.65% |
|
|
|
|
|
|
WINTRUST FINANCIAL
CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION |
Net Interest Margin
(Including Call Option Income - YTD Trends) |
|
|
Three Months Ended, |
Years Ended |
|
March 31, |
December 31, |
(Dollars in thousands) |
2015 |
2014 |
2013 |
2012 |
2011 |
Net interest income |
$ 152,952 |
$ 601,744 |
$ 552,887 |
$ 521,463 |
$ 463,071 |
Call option income |
4,360 |
7,859 |
4,773 |
10,476 |
13,570 |
Net interest income including call option
income |
$ 157,312 |
$ 609,603 |
$ 557,660 |
$ 531,939 |
$ 476,641 |
Yield on earning assets |
3.83% |
3.96% |
4.01% |
4.21% |
4.49% |
Rate on interest-bearing liabilities |
0.54 |
0.55 |
0.62 |
0.86 |
1.23 |
Rate spread |
3.29% |
3.41% |
3.39% |
3.35% |
3.26% |
Net free funds contribution |
0.13 |
0.12 |
0.11 |
0.14 |
0.16 |
Net interest margin |
3.42 |
3.53 |
3.50 |
3.49 |
3.42 |
Call option income |
0.10 |
0.05 |
0.03 |
0.07 |
0.10 |
Net interest margin including call option
income |
3.52% |
3.58% |
3.53% |
3.56% |
3.52% |
|
|
|
|
|
|
WINTRUST FINANCIAL
CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION |
Quarterly Average
Balances - 5 Quarter Trends |
|
|
Three Months Ended |
|
March 31, |
December 31, |
September 30, |
June 30, |
March 31, |
(In thousands) |
2015 |
2014 |
2014 |
2014 |
2014 |
Liquidity management assets |
$ 2,868,906 |
$ 2,972,220 |
$ 2,814,720 |
$ 2,607,980 |
$ 2,646,720 |
Other earning assets |
27,717 |
29,699 |
28,702 |
27,463 |
28,925 |
Loans, net of unearned income |
15,031,917 |
14,469,745 |
14,359,467 |
13,710,535 |
13,278,122 |
Covered loans |
214,211 |
244,139 |
262,310 |
292,553 |
325,885 |
Total earning assets |
$ 18,142,751 |
$ 17,715,803 |
$ 17,465,199 |
$ 16,638,531 |
$ 16,279,652 |
Allowance for loan and covered loan
losses |
(96,918) |
(97,506) |
(96,463) |
(98,255) |
(110,304) |
Cash and due from banks |
249,687 |
243,080 |
237,402 |
232,716 |
223,324 |
Other assets |
1,530,720 |
1,505,293 |
1,521,208 |
1,529,950 |
1,588,271 |
Total assets |
$ 19,826,240 |
$ 19,366,670 |
$ 19,127,346 |
$ 18,302,942 |
$ 17,980,943 |
Interest-bearing deposits |
$ 12,863,507 |
$ 12,771,359 |
$ 12,695,780 |
$ 12,284,444 |
$ 12,121,185 |
Federal Home Loan Bank advances |
357,532 |
335,198 |
380,083 |
446,778 |
388,975 |
Other borrowings |
194,994 |
84,795 |
54,653 |
148,135 |
244,950 |
Subordinated notes |
140,000 |
140,000 |
140,000 |
27,692 |
— |
Junior subordinated notes |
249,493 |
249,493 |
249,493 |
249,493 |
249,493 |
Total interest-bearing liabilities |
$ 13,805,526 |
$ 13,580,845 |
$ 13,520,009 |
$ 13,156,542 |
$ 13,004,603 |
Non-interest bearing deposits |
3,584,452 |
3,398,774 |
3,233,937 |
2,880,501 |
2,726,872 |
Other liabilities |
321,906 |
329,196 |
352,497 |
294,243 |
325,819 |
Equity |
2,114,356 |
2,057,855 |
2,020,903 |
1,971,656 |
1,923,649 |
Total liabilities and shareholders'
equity |
$ 19,826,240 |
$ 19,366,670 |
$ 19,127,346 |
$ 18,302,942 |
$ 17,980,943 |
|
|
|
|
|
|
WINTRUST FINANCIAL
CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION |
Net Interest Margin - 5
Quarter Trends |
|
|
Three Months Ended |
|
March 31, 2015 |
December 31, 2014 |
September 30, 2014 |
June 30, 2014 |
March 31, 2014 |
Yield earned on: |
|
|
|
|
|
Liquidity management assets |
2.29% |
2.08% |
2.03% |
2.28% |
2.23% |
Other earning assets |
2.94 |
3.40 |
3.21 |
3.02 |
3.12 |
Loans, net of unearned income |
4.08 |
4.21 |
4.19 |
4.25 |
4.29 |
Covered loans |
6.98 |
6.80 |
8.03 |
9.73 |
8.64 |
Total earning assets |
3.83% |
3.89% |
3.90% |
4.03% |
4.04% |
Rate paid on: |
|
|
|
|
|
Interest-bearing deposits |
0.37% |
0.39% |
0.38% |
0.38% |
0.40% |
Federal Home Loan Bank advances |
2.45 |
3.00 |
2.76 |
2.43 |
2.76 |
Other borrowings |
1.64 |
1.47 |
1.45 |
1.38 |
1.24 |
Subordinated notes |
5.07 |
5.07 |
5.07 |
5.06 |
— |
Junior subordinated notes |
3.10 |
3.04 |
3.28 |
3.24 |
3.21 |
Total interest-bearing liabilities |
0.54% |
0.55% |
0.56% |
0.53% |
0.54% |
Interest rate spread |
3.29% |
3.34% |
3.34% |
3.50% |
3.50% |
Net free funds/contribution |
0.13 |
0.12 |
0.12 |
0.12 |
0.11 |
Net interest income/Net interest margin |
3.42% |
3.46% |
3.46% |
3.62% |
3.61% |
|
|
|
|
|
|
WINTRUST FINANCIAL
CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION |
Non-Interest Income - 5
Quarter Trends |
|
|
Three Months Ended |
|
March 31, |
December 31, |
September 30, |
June 30, |
March 31, |
(In thousands) |
2015 |
2014 |
2014 |
2014 |
2014 |
Brokerage |
$ 6,852 |
$ 7,892 |
$ 7,185 |
$ 8,270 |
$ 7,091 |
Trust and asset management |
11,248 |
10,757 |
10,474 |
9,952 |
9,722 |
Total wealth management |
18,100 |
18,649 |
17,659 |
18,222 |
16,813 |
Mortgage banking |
27,800 |
24,694 |
26,691 |
23,804 |
16,428 |
Service charges on deposit accounts |
6,297 |
6,189 |
6,084 |
5,688 |
5,346 |
Gains (losses) on available-for-sale
securities, net |
524 |
18 |
(153) |
(336) |
(33) |
Fees from covered call options |
4,360 |
2,966 |
2,107 |
1,244 |
1,542 |
Trading (losses) gains, net |
(477) |
(507) |
293 |
(743) |
(652) |
Other: |
|
|
|
|
|
Interest rate swap fees |
2,191 |
1,119 |
1,207 |
1,192 |
951 |
Bank Owned Life Insurance |
766 |
661 |
652 |
675 |
712 |
Administrative services |
1,026 |
1,107 |
990 |
938 |
859 |
Miscellaneous |
3,954 |
2,761 |
2,422 |
3,418 |
3,563 |
Total other income |
7,937 |
5,648 |
5,271 |
6,223 |
6,085 |
Total Non-Interest
Income |
$ 64,541 |
$ 57,657 |
$ 57,952 |
$ 54,102 |
$ 45,529 |
|
|
|
|
|
|
WINTRUST FINANCIAL
CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION |
Non-Interest Expense - 5
Quarter Trends |
|
|
Three Months Ended |
|
March 31, |
December 31, |
September 30, |
June 30, |
March 31, |
(In thousands) |
2015 |
2014 |
2014 |
2014 |
2014 |
Salaries and employee benefits: |
|
|
|
|
|
Salaries |
$ 46,848 |
$ 45,255 |
$ 45,471 |
$ 43,349 |
$ 43,736 |
Commissions and incentive compensation |
25,494 |
28,369 |
27,885 |
25,398 |
21,534 |
Benefits |
17,788 |
14,009 |
12,620 |
13,216 |
14,664 |
Total salaries and employee benefits |
90,130 |
87,633 |
85,976 |
81,963 |
79,934 |
Equipment |
7,836 |
7,555 |
7,570 |
7,223 |
7,403 |
Occupancy, net |
12,351 |
11,600 |
10,446 |
9,850 |
10,993 |
Data processing |
5,448 |
5,313 |
4,765 |
4,543 |
4,715 |
Advertising and marketing |
3,907 |
3,669 |
3,528 |
3,558 |
2,816 |
Professional fees |
4,664 |
4,039 |
4,035 |
4,046 |
3,454 |
Amortization of other intangible assets |
1,013 |
1,171 |
1,202 |
1,156 |
1,163 |
FDIC insurance |
2,987 |
2,810 |
3,211 |
3,196 |
2,951 |
OREO expense, net |
1,411 |
2,320 |
581 |
2,490 |
3,976 |
Other: |
|
|
|
|
|
Commissions - 3rd party brokers |
1,386 |
1,470 |
1,621 |
1,633 |
1,657 |
Postage |
1,633 |
1,724 |
1,427 |
1,465 |
1,429 |
Miscellaneous |
14,552 |
14,137 |
14,138 |
12,468 |
10,824 |
Total other expense |
17,571 |
17,331 |
17,186 |
15,566 |
13,910 |
Total Non-Interest
Expense |
$ 147,318 |
$ 143,441 |
$ 138,500 |
$ 133,591 |
$ 131,315 |
|
|
|
|
|
|
WINTRUST FINANCIAL
CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION |
Allowance for Credit
Losses, excluding covered loans - 5 Quarter Trends |
|
|
Three Months Ended |
|
March 31, |
December 31, |
September 30, |
June 30, |
March 31, |
(Dollars in thousands) |
2015 |
2014 |
2014 |
2014 |
2014 |
Allowance for loan losses at
beginning of period |
$ 91,705 |
$ 91,019 |
$ 92,253 |
$ 92,275 |
$ 96,922 |
Provision for credit
losses |
6,185 |
6,744 |
6,028 |
6,813 |
3,304 |
Other adjustments |
(248) |
(236) |
(335) |
(105) |
(148) |
Reclassification (to) from allowance
for unfunded lending-related commitments |
(113) |
46 |
62 |
(146) |
(18) |
Charge-offs: |
|
|
|
|
|
Commercial |
677 |
289 |
832 |
2,384 |
648 |
Commercial real estate |
1,005 |
4,434 |
4,510 |
2,351 |
4,493 |
Home equity |
584 |
150 |
748 |
730 |
2,267 |
Residential real estate |
631 |
630 |
205 |
689 |
226 |
Premium finance receivables -
commercial |
1,263 |
1,463 |
1,557 |
1,492 |
1,210 |
Premium finance receivables - life
insurance |
— |
4 |
— |
— |
— |
Consumer and other |
111 |
156 |
250 |
213 |
173 |
Total charge-offs |
4,271 |
7,126 |
8,102 |
7,859 |
9,017 |
Recoveries: |
|
|
|
|
|
Commercial |
370 |
315 |
296 |
270 |
317 |
Commercial real estate |
312 |
572 |
275 |
342 |
145 |
Home equity |
48 |
57 |
99 |
122 |
257 |
Residential real estate |
76 |
19 |
111 |
74 |
131 |
Premium finance receivables -
commercial |
329 |
219 |
289 |
312 |
319 |
Premium finance receivables - life
insurance |
— |
6 |
1 |
2 |
2 |
Consumer and other |
53 |
70 |
42 |
153 |
61 |
Total recoveries |
1,188 |
1,258 |
1,113 |
1,275 |
1,232 |
Net charge-offs |
(3,083) |
(5,868) |
(6,989) |
(6,584) |
(7,785) |
Allowance for loan losses at
period end |
$ 94,446 |
$ 91,705 |
$ 91,019 |
$ 92,253 |
$ 92,275 |
Allowance for unfunded
lending-related commitments at period end |
888 |
775 |
822 |
884 |
737 |
Allowance for credit losses at
period end |
$ 95,334 |
$ 92,480 |
$ 91,841 |
$ 93,137 |
$ 93,012 |
Annualized net charge-offs by
category as a percentage of its own respective category's
average: |
|
|
|
|
|
Commercial |
0.03% |
—% |
0.06% |
0.24% |
0.04% |
Commercial real estate |
0.06 |
0.34 |
0.38 |
0.19 |
0.41 |
Home equity |
0.30 |
0.05 |
0.36 |
0.34 |
1.14 |
Residential real estate |
0.28 |
0.30 |
0.05 |
0.35 |
0.06 |
Premium finance receivables -
commercial |
0.16 |
0.21 |
0.20 |
0.20 |
0.16 |
Premium finance receivables - life
insurance |
— |
— |
— |
— |
— |
Consumer and other |
0.13 |
0.19 |
0.49 |
0.14 |
0.26 |
Total loans, net of unearned income,
excluding covered loans |
0.08% |
0.16% |
0.19% |
0.19% |
0.24% |
Net charge-offs as a percentage
of the provision for credit losses |
49.87% |
86.98% |
115.95% |
96.62% |
235.65% |
Loans at period-end |
$ 14,953,059 |
$ 14,409,398 |
$ 14,052,059 |
$ 13,749,996 |
$ 13,133,160 |
Allowance for loan losses as a
percentage of loans at period end |
0.63% |
0.64% |
0.65% |
0.67% |
0.70% |
Allowance for credit losses as a
percentage of loans at period end |
0.64% |
0.64% |
0.65% |
0.68% |
0.71% |
|
|
|
|
|
|
WINTRUST FINANCIAL
CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION |
Non-Performing Assets,
excluding covered assets - 5 Quarter Trends |
|
|
|
March 31, |
December 31, |
September 30, |
June 30, |
March 31, |
(Dollars in thousands) |
2015 |
2014 |
2014 |
2014 |
2014 |
Loans past due greater than 90 days
and still accruing(1): |
|
|
|
|
|
Commercial |
$ — |
$ 474 |
$ — |
$ — |
$ 387 |
Commercial real-estate |
— |
— |
— |
309 |
— |
Home equity |
— |
— |
— |
— |
— |
Residential real-estate |
— |
— |
— |
— |
— |
Premium finance receivables -
commercial |
8,062 |
7,665 |
7,115 |
10,275 |
6,808 |
Premium finance receivables - life
insurance |
— |
— |
— |
649 |
— |
Consumer and other |
91 |
119 |
175 |
73 |
57 |
Total loans past due greater than 90 days
and still accruing |
8,153 |
8,258 |
7,290 |
11,306 |
7,252 |
Non-accrual loans(2): |
|
|
|
|
|
Commercial |
5,586 |
9,157 |
10,455 |
6,511 |
11,782 |
Commercial real-estate |
29,982 |
26,605 |
27,363 |
36,321 |
33,733 |
Home equity |
7,665 |
6,174 |
5,696 |
5,804 |
7,311 |
Residential real-estate |
14,248 |
15,502 |
15,730 |
15,294 |
14,385 |
Premium finance receivables -
commercial |
15,902 |
12,705 |
14,110 |
12,298 |
14,517 |
Premium finance receivables - life
insurance |
— |
— |
— |
— |
— |
Consumer and other |
236 |
277 |
426 |
1,116 |
1,144 |
Total non-accrual loans |
73,619 |
70,420 |
73,780 |
77,344 |
82,872 |
Total non-performing
loans: |
|
|
|
|
|
Commercial |
5,586 |
9,631 |
10,455 |
6,511 |
12,169 |
Commercial real-estate |
29,982 |
26,605 |
27,363 |
36,630 |
33,733 |
Home equity |
7,665 |
6,174 |
5,696 |
5,804 |
7,311 |
Residential real-estate |
14,248 |
15,502 |
15,730 |
15,294 |
14,385 |
Premium finance receivables -
commercial |
23,964 |
20,370 |
21,225 |
22,573 |
21,325 |
Premium finance receivables - life
insurance |
— |
— |
— |
649 |
— |
Consumer and other |
327 |
395 |
601 |
1,189 |
1,201 |
Total non-performing loans |
$ 81,772 |
$ 78,677 |
$ 81,070 |
$ 88,650 |
$ 90,124 |
Other real estate owned |
33,131 |
36,419 |
41,506 |
51,673 |
47,656 |
Other real estate owned - from
acquisitions |
9,126 |
9,223 |
8,871 |
7,915 |
6,475 |
Other repossessed assets |
259 |
303 |
292 |
311 |
426 |
Total non-performing assets |
$ 124,288 |
$ 124,622 |
$ 131,739 |
$ 148,549 |
$ 144,681 |
TDRs performing under the contractual
terms of the loan agreement |
54,687 |
69,697 |
69,868 |
72,199 |
74,622 |
Total non-performing loans by
category as a percent of its own respective category's period-end
balance: |
|
|
|
|
|
Commercial |
0.13% |
0.25% |
0.28% |
0.18% |
0.35% |
Commercial real-estate |
0.64 |
0.59 |
0.61 |
0.84 |
0.79 |
Home equity |
1.08 |
0.86 |
0.79 |
0.81 |
1.03 |
Residential real-estate |
2.87 |
3.21 |
3.34 |
3.38 |
3.37 |
Premium finance receivables -
commercial |
1.03 |
0.87 |
0.89 |
0.95 |
0.97 |
Premium finance receivables - life
insurance |
— |
— |
— |
0.03 |
— |
Consumer and other |
0.25 |
0.26 |
0.40 |
0.74 |
0.75 |
Total loans, net of unearned income |
0.55% |
0.55% |
0.58% |
0.64% |
0.69% |
Total non-performing assets as a
percentage of total assets |
0.61% |
0.62% |
0.69% |
0.79% |
0.79% |
Allowance for loan losses as a
percentage of total non-performing loans |
115.50% |
116.56% |
112.27% |
104.06% |
102.39% |
|
|
|
|
|
|
(1) As of the dates shown,
no TDRs were past due greater than 90 days and still accruing
interest. |
(2) Non-accrual loans
included TDRs totaling $12.5 million, $12.6 million, $13.5 million,
$15.9 million and $17.9 million as of March 31, 2015,
December 31, 2014, September 30, 2014, June 30, 2014 and March
31, 2014, respectively. |
CONTACT: Edward J. Wehmer, President
& Chief Executive Officer
David A. Dykstra, Senior Executive Vice President
& Chief Operating Officer
(847) 939-9000
Web site address: www.wintrust.com
Wintrust Financial (NASDAQ:WTFC)
Historical Stock Chart
From Sep 2024 to Oct 2024
Wintrust Financial (NASDAQ:WTFC)
Historical Stock Chart
From Oct 2023 to Oct 2024