ROSEMONT, Ill., Jan. 21, 2020 (GLOBE NEWSWIRE) -- Wintrust
Financial Corporation (“Wintrust” or “the Company”) (Nasdaq: WTFC)
announced record net income of $355.7 million or $6.03 per diluted
common share for the year ended December 31, 2019 compared to net
income of $343.2 million or $5.86 per diluted common share for the
same period of 2018. The Company recorded net income of $86.0
million or $1.44 per diluted common share for the fourth quarter of
2019, a decrease in diluted earnings per common share of 14.8%
compared to the prior quarter and an increase of 6.7% compared to
the fourth quarter of 2018.
Highlights of the Fourth Quarter of
2019:
Comparative information to the third quarter of 2019
- Total assets increased by $1.7
billion, including $240 million from the acquisition of STC Capital
Bancshares and $607 million from the acquisition of SBC,
Incorporated, or 19% on an annualized basis.
- Total loans increased by $1.1
billion, including $164 million from the acquisition of STC Capital
Bancshares and $418 million from the acquisition of SBC,
Incorporated, or 17% on an annualized basis.
- Total deposits increased by $1.4
billion, including $194 million from the acquisition of STC Capital
Bancshares and $496 million from the acquisition of SBC,
Incorporated, or 19% on an annualized basis. The increase was net
of a $201 million reduction in brokered deposits.
- Mortgage banking production revenue
decreased by $6.3 million as mortgage loans originated for sale
totaled $1.2 billion in the fourth quarter of 2019 as compared to
$1.4 billion in the third quarter of 2019.
- Net interest income decreased by
$3.0 million as a 20 basis point decline in net interest margin was
partially offset by a $1.5 billion increase in average earning
assets.
- Recorded net charge-offs of $12.7
million in the fourth quarter of 2019 as compared to $9.4 million
in the third quarter of 2019. The $12.7 million includes a $5.3
million charge-off of a commercial loan, which was fully reserved
for in prior quarters.
- The ratio of non-performing assets
to total assets declined by two basis points to 0.36%.
Other highlights of the fourth quarter of
2019
- Recorded a $2.8 million reduction
to FDIC insurance expense related to assessment credits received
from the FDIC. The Company received $3.9 million of assessment
credits from the FDIC in the third quarter of 2019.
- Recorded an increase in the value
of mortgage servicing rights related to changes in fair value model
assumptions, net of derivative contract activity held as an
economic hedge, of $1.8 million.
- Incurred acquisition related costs
of $2.4 million in the fourth quarter of 2019 as compared to $1.3
million in the third quarter of 2019.
- Recognized various non-operating
charges totaling $5.4 million. This includes expenses related to a
litigation settlement, loan remediation, contingent consideration
related to previous acquisitions of certain mortgage businesses,
pension plan terminations, operating lease impairment and losses on
partnership investments.
- Announced approval of a stock
buyback program which authorizes the repurchase of up to $125
million in common shares.
Expansion activity
- Opened two new branches in the
Chicago suburbs located in Palatine and Maywood, Illinois.
- Completed the previously announced
acquisition of STC Bancshares Corp., the parent company of STC
Capital Bank.
- Completed the previously announced
acquisition of SBC, Incorporated, the parent company of Countryside
Bank.
Edward J. Wehmer, President and Chief Executive
Officer, commented, "As the decade closes, I reflect back on the
recent history of Wintrust and I am proud of the franchise that we
have built. In the last 10 years, Wintrust has experienced
significant growth and has become a household name in the Chicago
and Milwaukee areas. Wintrust now boasts the largest deposit base
in the Chicago market area among locally headquartered banks which
is a product of our consistent growth strategy that has yielded 12%
compound annual growth in assets, loans and deposits over the past
10 years. Additionally, the last nine years of the decade reported
record annual net income. Admittedly, 2019 was not what we expected
with respect to our profitability goals. However, 2019 was a
success with respect to our efforts to increase market share and
household penetration in our market areas and continue to establish
Wintrust as a reliable partner with excellent customer service. We
believe that our core operating tenants that have produced the
success that we have experienced over the past 10 years will
continue to serve us favorably as we seek to grow strategically in
2020 and beyond."
Transitioning to the current quarter, Mr. Wehmer
proceeded, "Wintrust reported net income of $86.0 million for the
fourth quarter of 2019, down from $99.1 million in the third
quarter of 2019 and record annual net income of $355.7 million in
2019 as compared to $343.2 million in 2018. The Company experienced
strong balance sheet growth as total assets were $1.7 billion
higher than the prior quarter end and $5.4 billion higher than at
the fourth quarter of 2018. The fourth quarter was characterized by
strong balance sheet growth, decreased net interest margin,
decreased mortgage banking revenue, stable credit quality, and a
continued focus to increase franchise value in our market
area."
Mr. Wehmer continued, "The Company experienced
deposit growth of $1.4 billion in the fourth quarter of 2019 which
was net of a reduction of $201 million in brokered deposits to
optimize our funding base. Non-brokered deposits now comprise
approximately 97% of total deposits. Additionally, the Company grew
total loans by $1.1 billion with growth diversified across various
loan portfolios including the commercial, commercial real estate,
life insurance premium finance receivables and residential real
estate portfolios. We remain aggressive in growing quality assets
that meet our standards and will seek to fund that by expanding
deposit market share and household penetration."
Mr. Wehmer commented, "Net interest margin
declined by 20 basis points in the fourth quarter of 2019 as
compared to the third quarter of 2019 primarily due to downward
repricing of variable rate loans partially offset by improvement in
deposit pricing. Given the relatively stable short-term outlook on
interest rates, we expect to hold loan yields steady while
continuing to reduce our interest bearing deposit costs.
Additionally, we expect to deploy the excess liquidity gathered in
the third and fourth quarters of 2019 to enhance net interest
income. As always, we will strive to grow without a commensurate
increase in expenses to enhance our net overhead ratio which was
1.53% in the fourth quarter of 2019."
Mr. Wehmer noted, “Our mortgage banking business
production decreased in the current quarter as loan volumes
originated for sale decreased to $1.2 billion from $1.4 billion in
the third quarter of 2019. The decrease in origination volumes was
primarily attributed to the seasonal purchase market decline which
was partially mitigated by elevated refinancing activity. Our
mortgage servicing rights portfolio increased by $10.1 million
primarily due to the capitalization of retained servicing rights of
$14.5 million partially offset by a $6.8 million reduction related
to payoffs and paydowns. We recorded a $1.8 million increase due to
changes in fair value assumptions, net of derivative contract
activity held as an economic hedge. We continue to focus on
efficiencies in our delivery channels and our operating costs in
our mortgage banking area. We believe that the mortgage rate
outlook in the first quarter of 2020 will continue to result in
elevated refinancing activity, which will supplement the seasonally
challenging purchase market."
Commenting on credit quality, Mr. Wehmer stated,
"Overall credit quality metrics were positive in the fourth quarter
of 2019. The Company recorded net charge-offs of $12.7 million in
the fourth quarter of 2019 as compared to $9.4 million in the third
quarter of 2019. The $12.7 million of net charge-offs in the
current quarter includes a $5.3 million charge-off of a commercial
loan, which was fully reserved for in prior quarters. Although we
experienced elevated charge-offs in the second quarter of 2019, net
charge-offs for the year of 2019 were 20 basis points. The ratio of
non-performing assets as a percent of total assets declined by two
basis points to a historically low level of 0.36%. We believe
that the Company’s reserves remain appropriate and we remain
diligent in our review of credit."
Turning to the future, Mr. Wehmer stated, “We
have experienced significant franchise growth in 2019 and believe
that our opportunities for both internal and external growth remain
consistently strong. Total period end loans were $663 million
higher than average total loans in the current quarter which
provides momentum into the first quarter of 2020. We plan to
continue our steady and measured approach to achieve our main
objectives of growing franchise value, increasing profitability,
leveraging our expense infrastructure and continuing to increase
shareholder value. Evaluating strategic acquisitions, like the
completed acquisitions of STC Bancshares Corp. and SBC,
Incorporated, as well as focusing on organic branch growth will
continue to be a part of our overall growth strategy with the goal
of becoming Chicago’s bank and Wisconsin’s bank."
The graphs below illustrate the annual trend of
certain financial highlights, including the 10 year compound annual
growth rate ("CAGR").
Graphs available at the following link:
http://ml.globenewswire.com/Resource/Download/ee80b169-0adb-4a48-bc91-93f46e6dc982
SUMMARY OF RESULTS:
BALANCE SHEET
Total assets grew by $1.7 billion in the fourth
quarter of 2019 primarily due to a $1.1 billion increase in loans
and an $836 million increase in available for sale securities,
partially offset by a reduction in liquidity. The increase in
assets and loans include acquired balances of $847 million and $582
million, respectively. The Company believes that the $2.2 billion
of interest bearing deposits with banks held as of December 31,
2019 is more than sufficient liquidity to operate its business
plan. Excess liquidity is expected to be deployed in future
quarters to enhance net interest income.
Total liabilities grew by $1.6 billion in the
fourth quarter of 2019 primarily comprised of a $1.4 billion
increase in total deposits of which $690 million related to
acquisitions. The Company successfully grew deposits in the fourth
quarter through organic retail channels, acquisitions and its
wealth management segment. In addition, the total deposit growth
was net of a $201 million reduction in brokered deposits.
Management believes in substantially funding the Company's balance
sheet with core deposits and utilizes brokered or wholesale funding
sources as appropriate to manage its liquidity position as well as
for interest rate risk management purposes. Non-brokered deposits
now comprise approximately 97% of total deposits.
For more information regarding changes in the
Company’s balance sheet, see Consolidated Statements of Condition
and Tables 1 through 4 in this report.
NET INTEREST INCOME
For the fourth quarter of 2019, net interest
income totaled $261.9 million, a decrease of $3.0 million as
compared to the third quarter of 2019 and an increase of $7.8
million as compared to the fourth quarter of 2018. The $3.0 million
decrease in net interest income in the fourth quarter of 2019
compared to the third quarter of 2019 was attributable to the
impact of a 20 basis point decline in net interest margin. This
impact was partially offset by $1.5 billion of growth in average
earning assets.
Net interest margin was 3.17% (3.19% on a fully
taxable-equivalent basis, non-GAAP) during the fourth quarter of
2019 compared to 3.37% (3.39% on a fully taxable-equivalent basis,
non-GAAP) during the third quarter of 2019 and 3.61% (3.63% on a
fully taxable-equivalent basis, non-GAAP) during the fourth quarter
of 2018. The 20 basis point decrease in net interest margin in the
fourth quarter of 2019 as compared to the third quarter of 2019 was
attributable to a 28 basis point decline in the yield on earnings
assets and three basis point decrease in the net free funds
contribution partially offset by an 11 basis point decrease in the
rate paid on interest bearing liabilities. The 28 basis point
decline in the yield on earning assets in the current quarter as
compared to the third quarter of 2019 was primarily due to a 24
basis point decline in the yield on loans along with lower yields
on interest bearing cash. The 11 basis point decrease in the rate
paid on interest bearing liabilities in the current quarter as
compared to the prior quarter is primarily due to a 10 basis point
decrease in the rate paid on interest bearing deposits as
management initiated various deposit rate reductions given the
recent decrease in the interest rate environment.
For the full twelve months of 2019, net interest
income totaled $1.1 billion, an increase of $90.0 million as
compared to the full twelve months of 2018. Net interest margin was
3.45% (3.47% on a fully taxable-equivalent basis, non-GAAP) for the
full twelve months of 2019 compared to 3.59% (3.61% on a fully
taxable-equivalent basis, non-GAAP) for the full twelve months of
2018.
For more information regarding net interest
income, see Tables 5 through 10 in this report.
ASSET QUALITY
The allowance for credit 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 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).
Net charge-offs as a percentage of average total
loans, in the fourth quarter of 2019 totaled 19 basis points on an
annualized basis compared to 15 basis points on an annualized basis
in the third quarter of 2019 and 12 basis points on an annualized
basis in the fourth quarter of 2018. Net charge-offs totaled $12.7
million in the fourth quarter of 2019, a $3.3 million increase from
$9.4 million in the third quarter of 2019 and a $5.5 million
increase from $7.2 million in the fourth quarter of 2018. The $12.7
million of net charge-offs in the current quarter includes a $5.3
million charge-off of a commercial loan, which was fully reserved
for in prior quarters. The provision for credit losses totaled $7.8
million for the fourth quarter of 2019 compared to $10.8 million
for the third quarter of 2019 and $10.4 million for the fourth
quarter of 2018. For more information regarding net charge-offs,
see Table 11 in this report.
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.
As part of the regular 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 as of
December 31, 2019 and September 30, 2019 is shown on
Table 12 of this report.
As of December 31, 2019, $50.5 million of
all loans, or 0.2%, were 60 to 89 days past due and $248.2 million,
or 0.9%, were 30 to 59 days (or one payment) past due. As of
September 30, 2019, $51.1 million of all loans, or 0.2%, were
60 to 89 days past due and $134.2 million, or 0.5%, were 30 to 59
days (or one payment) past due. Many 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 December 31, 2019 that are current with regard to the
contractual terms of the loan agreement represent 97.8% of the
total home equity portfolio. Residential real estate loans at
December 31, 2019 that are current with regards to the
contractual terms of the loan agreements comprise 97.1% of total
residential real estate loans outstanding. For more information
regarding past due loans, see Table 13 in this report.
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. In addition to the $156.8 million of allowance for loan
losses, there was $11.6 million of non-accretable credit discount
on purchased loans reported in accordance with ASC 310-30 that is
available to absorb credit losses as of December 31, 2019.
The ratio of non-performing assets to total
assets was 0.36% as of December 31, 2019, compared to 0.38% at
September 30, 2019, and 0.44% at December 31, 2018.
Non-performing assets, excluding PCI loans, totaled $132.8 million
at December 31, 2019, compared to $132.0 million at
September 30, 2019 and $138.3 million at December 31,
2018. Non-performing loans, excluding PCI loans, totaled $117.6
million, or 0.44% of total loans, at December 31, 2019
compared to $114.3 million, or 0.44% of total loans, at
September 30, 2019 and $113.2 million, or 0.48% of total
loans, at December 31, 2018. Other real estate owned ("OREO")
of $15.2 million at December 31, 2019 decreased $2.3 million
compared to $17.5 million at September 30, 2019 and decreased
$9.6 million compared to $24.8 million at December 31, 2018.
Management is pursuing the resolution of all non-performing assets.
At this time, management believes reserves are appropriate to
absorb inherent losses and OREO is appropriately valued at the
lower of carrying value or fair value less estimated costs to sell.
For more information regarding non-performing assets, see Table 14
in this report.
NON-INTEREST INCOME
Wealth management revenue increased by $1.0
million during the fourth quarter of 2019 as compared to the third
quarter of 2019 primarily due to increased asset management
revenue. Wealth management revenue is comprised of the trust and
asset management revenue of The Chicago Trust Company and Great
Lakes Advisors, the brokerage commissions, managed money fees and
insurance product commissions at Wintrust Investments and fees from
tax-deferred like-kind exchange services provided by the Chicago
Deferred Exchange Company.
Mortgage banking revenue decreased by $3.0
million in the fourth quarter of 2019 as compared to the third
quarter of 2019, primarily as a result of lower production
revenues, partially offset by an increase in the fair value of the
mortgage servicing rights portfolio in the fourth quarter of 2019.
Production revenue decreased by $6.3 million in the fourth quarter
of 2019 as compared to the third quarter of 2019 primarily due to a
decrease in origination volumes. The decrease in origination
volumes was primarily attributed to the seasonal purchase market
decline which was partially mitigated by elevated refinancing
activity. The percentage of origination volume from refinancing
activities was 60% in the fourth quarter of 2019 as compared to 52%
in the third quarter of 2019. Production margin declined from 2.88%
in the third quarter of 2019 to 2.78% in the fourth quarter of
2019. Mortgage banking revenue includes revenue from activities
related to originating, selling and servicing residential real
estate loans for the secondary market.
During the fourth quarter of 2019, the fair
value of the mortgage servicing rights portfolio increased as
retained servicing rights led to the capitalization of $14.5
million along with a positive fair value adjustment of $2.3 million
partially offset by a reduction in value of $6.8 million due to
payoffs and paydowns of the existing portfolio. The Company entered
into interest rate swaps at the beginning of the fourth quarter of
2019 to economically hedge a portion of the potential negative fair
value changes recorded in earnings related to its mortgage
servicing rights portfolio. The Company recorded a loss of $483,000
on the interest rate swaps held as economic hedges against the
mortgage servicing rights primarily related to the mark to market
at year end which was recorded in mortgage banking revenue.
The net gains recognized on investment
securities in the fourth quarter of 2019 were $587,000 as compared
to $710,000 in third quarter of 2019. The gains recorded in the
fourth quarter of 2019 relate to unrealized gains recognized on
equity securities held by the Company.
Other non-interest income decreased by $3.5
million in the fourth quarter of 2019 as compared to the third
quarter of 2019 primarily due to decreased income from
investments in partnerships and interest rate swap fees.
For more information regarding non-interest
income, see Tables 15 and 16 in this report.
NON-INTEREST EXPENSE
Salaries and employee benefits expense increased
by $4.9 million in the fourth quarter of 2019 as compared to the
third quarter of 2019. The $4.9 million increase is comprised of an
increase of $4.8 million in salaries expense and $159,000 in
benefits expense, partially offset by a decrease of $63,000 in
commissions and incentive compensation. The increase in salaries
and employee benefits expense is primarily due to increased
staffing as the Company grows, $1.0 million of higher acquisition
related costs and $487,000 of costs to terminate two pension
plans.
Equipment expense totaled $14.5 million in the
fourth quarter of 2019, an increase of $1.2 million as compared to
the third quarter of 2019. The increase in the current quarter
relates primarily to increased software depreciation expenses.
Advertising and marketing expenses in the fourth
quarter of 2019 decreased by $858,000 as compared to the third
quarter of 2019 primarily related to lower corporate sponsorship
costs. Marketing costs are incurred to promote the Company's brand,
commercial banking capabilities, the Company's various products, to
attract loans and deposits and to announce new branch openings as
well as the expansion of the Company's non-bank businesses. The
level of marketing expenditures depends on the timing of
sponsorship programs utilized which are determined based on the
market area, targeted audience, competition and various other
factors.
FDIC insurance expense totaled $1.3 million in
the fourth quarter of 2019, an increase of $1.2 million as compared
to the third quarter of 2019. In the current quarter, the Company
recorded a $2.8 million reduction to FDIC insurance expense related
to assessment credits received from the FDIC. The Company received
$3.9 million of assessment credits from the FDIC in the third
quarter of 2019.
Occupancy expense totaled $17.1 million in the
fourth quarter of 2019, an increase of $2.1 million as compared to
the third quarter of 2019. The increase in the current quarter
relates primarily to increased expenses due to acquired locations,
property tax expense and rental expense.
Miscellaneous expense in the fourth quarter of
2019 increased $5.6 million as compared to the third quarter of
2019. The increase in the current quarter as compared to the third
quarter of 2019 is primarily due to a litigation settlement,
contingent consideration related to previous acquisitions of
certain mortgage businesses and overlapping telecommunication
charges. 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.
For more information regarding non-interest
expense, see Table 17 in this report.
INCOME TAXES
The Company recorded income tax expense of $30.7
million in the fourth quarter of 2019 compared to $35.5 million in
the third quarter of 2019 and $28.0 million in the fourth quarter
of 2018. The effective tax rates were 26.33% in the fourth quarter
of 2019 compared to 26.36% in the third quarter of 2019 and 26.01%
in the fourth quarter of 2018. During the twelve months of 2019,
the Company recorded income tax expense of $124.4 million compared
to $117.0 million for the twelve months of 2018. The effective tax
rates were 25.91% for the twelve months of 2019 and 25.42% for the
twelve months of 2018.
The year-to-date effective tax rates were
impacted by excess tax benefits related to share-based
compensation. These excess tax benefits were $1.8 million in the
twelve months of 2019 and $3.9 million in the twelve months of
2018. Excess tax benefits will fluctuate throughout the year based
on the Company's stock price and timing of employee stock option
exercises and vesting of other share-based awards.
BUSINESS UNIT SUMMARY
Community Banking
Through its community banking unit, the Company
provides banking and financial services primarily to individuals,
small to mid-sized businesses, local governmental units and
institutional clients residing primarily in the local areas the
Company services. In the fourth quarter of 2019, this unit expanded
its loan and deposit portfolios. However, the banking segment also
experienced net interest margin compression in part due to current
market conditions.
Mortgage banking revenue was $47.9 million for
the fourth quarter of 2019 a decrease from $50.9 million for the
third quarter of 2019. Services charges on deposit accounts totaled
$11.0 million in the fourth quarter of 2019 an increase of $1.0
million as compared to the third quarter of 2019 primarily due to
higher account analysis fees. The Company's gross commercial and
commercial real estate loan pipelines remain strong. Before the
impact of scheduled payments and prepayments, gross commercial and
commercial real estate loan pipelines were estimated to be
approximately $1.0 billion to $1.1 billion at December 31,
2019. When adjusted for the probability of closing, the pipelines
were estimated to be approximately $650 million to $720 million at
December 31, 2019.
Specialty Finance
Through its specialty finance unit, the Company
offers financing of insurance premiums for businesses and
individuals, equipment financing through structured loans and lease
products to customers in a variety of industries and accounts
receivable financing, value-added, out-sourced administrative
services, and other services. Originations within the insurance
premium financing receivables portfolio were $2.5 billion during
the fourth quarter of 2019 and average balances increased by $217.4
million as compared to the third quarter of 2019. The increase in
average balances was more than offset by margin compression in this
portfolio resulting in a $2.4 million decrease in interest income
attributed to the insurance premium finance receivables portfolio.
The Company's leasing business grew during the fourth quarter of
2019, with its portfolio of assets, including capital leases, loans
and equipment on operating leases, increasing $123.8 million to
$1.6 billion at the end of the fourth quarter of 2019. Revenues
from the Company's out-sourced administrative services business
remained flat at $1.1 million in the third quarter of 2019 and
fourth quarter of 2019.
Wealth Management
Through four separate subsidiaries within its
wealth management unit, the Company offers a full range of wealth
management services, including trust and investment services,
tax-deferred like-kind exchange services, asset management,
securities brokerage services and 401(k) and retirement plan
services. Wealth management revenue increased by $1.0 million in
the fourth quarter of 2019 compared to the third quarter of 2019,
totaling $25.0 million in the current period. At December 31,
2019, the Company’s wealth management subsidiaries had
approximately $27.6 billion of assets under administration, which
included $4.2 billion of assets owned by the Company and its
subsidiary banks, representing a $1.5 billion increase from the
$26.1 billion of assets under administration at September 30,
2019. Successful new business development efforts and favorable
equity markets have contributed to growth in revenue and assets
under management.
ITEMS IMPACTING COMPARATIVE FINANCIAL
RESULTS
Acquisitions
On November 1, 2019, the Company completed its
acquisition of SBC, Incorporated (“SBC”). SBC was the parent
company of Countryside Bank. Through this business combination, the
Company acquired Countryside Bank's six banking offices located in
Countryside, Burbank, Darien, Homer Glen, Oak Brook and Chicago,
Illinois. As of the acquisition date, the Company acquired
approximately $620 million in assets, including approximately $423
million in loans, and approximately $508 million in deposits. The
Company recorded goodwill of approximately $40 million on the
acquisition.
On October 7, 2019, the Company completed its
acquisition of STC Bancshares Corp. (“STC”). STC was the parent
company of STC Capital Bank. Through this business combination, the
Company acquired STC Capital Bank's five banking offices located in
the communities of St. Charles, Geneva and South Elgin, Illinois.
As of the acquisition date, the Company acquired approximately $250
million in assets, including approximately $174 million in loans,
and approximately $202 million in deposits. The Company
recorded goodwill of approximately $19 million on the
acquisition.
On May 24, 2019, the Company completed its
acquisition of Oak Bank. Through this business combination, the
Company acquired Oak Bank's one banking location in Chicago,
Illinois. As of the acquisition date, the Company acquired
approximately $223 million in assets, including approximately $125
million in loans, and approximately $161 million in deposits. The
Company recorded goodwill of approximately $12 million on the
acquisition.
On December 14, 2018, the Company acquired
Elektra Holding Company, LLC, the parent company of Chicago
Deferred Exchange Company, LLC ("CDEC"). CDEC is a provider of
Qualified Intermediary services (as defined by U.S. Treasury
regulations) for taxpayers seeking to structure tax-deferred
like-kind exchanges under Internal Revenue Code Section 1031. CDEC
has successfully facilitated more than 8,000 like-kind exchanges in
the past decade for taxpayers nationwide. These transactions
typically generate customer deposits during the period following
the sale of the property until such proceeds are used to purchase a
replacement property. The Company recorded goodwill of
approximately $37 million on the acquisition.
On December 7, 2018, the Company completed its
acquisition of certain assets and the assumption of certain
liabilities of American Enterprise Bank. Through this asset
acquisition, the Company acquired approximately $164 million in
assets, including approximately $119 million in loans, and
approximately $151 million in deposits, as of the acquisition
date.
On August 1, 2018, the Company completed its
acquisition of Chicago Shore Corporation ("CSC"). CSC was the
parent company of Delaware Place Bank. Through this business
combination, the Company acquired Delaware Place Bank's one banking
location in Chicago, Illinois. As of the acquisition date, the
Company acquired approximately $283 million in assets, including
approximately $153 million in loans, and approximately $213 million
in deposits. The Company recorded goodwill of approximately $27
million on the acquisition.
On January 4, 2018, the Company acquired iFreedom Direct
Corporation DBA Veterans First Mortgage ("Veterans First") with
assets including mortgage-servicing-rights on approximately 10,000
loans, totaling an estimated $2 billion in unpaid principal
balance, as of the acquisition date. The Company recorded goodwill
of approximately $9 million on the acquisition.
ITEMS IMPACTING FINANCIAL RESULTS IN FUTURE
PERIODS
Adoption of New Credit Losses Accounting
Standard
Beginning in 2020, the Company is adopting the
new current expected credit losses standard, or CECL, which impacts
the measurement of the Company’s allowance for credit losses
(including the allowance for unfunded lending-related commitments).
CECL replaces the previous incurred loss methodology, which delays
recognition until such loss is probable, with a methodology that
reflects an estimate of lifetime expected credit losses considering
current economic condition and forecasts. Though other assets,
including investment securities and other receivables, are
considered in-scope of the standard and will require a measurement
of the allowance for credit loss, the most significant impact of
CECL remains within the Company’s loan portfolios and related
lending commitments.
Based upon the Company’s current composition of
assets as well as current considerations of existing and expected
future economic conditions, the Company estimates an increase to
the allowance for credit losses of approximately 30% to 50% at
adoption related to its loan portfolios and related lending
commitments. Approximately 80% of the estimated increase is
related to additions to existing reserves for unfunded
lending-related commitments due to the consideration under
CECL of expected utilization by the Company's borrowers over the
life of such commitments, as well as for acquired loans, which
previously considered credit discounts. The Company estimates an
insignificant impact at adoption of measuring an allowance for
credit losses for the other in-scope assets noted above. The
adjustment at adoption on January 1, 2020 is recognized as an
adjustment to the balance sheet (retained earnings or the related
asset basis dependent upon whether the asset is purchased credit
deteriorated from a prior acquisition). After adoption, adjustments
to the allowance for credit losses will primarily be recorded as
provision for credit losses on the Company’s income statement. The
estimate of the allowance for credit losses is highly dependent
upon considerations of current and expected economic conditions,
which may result in earnings volatility across economic cycles.
WINTRUST FINANCIAL
CORPORATION
Key Operating Measures
Wintrust’s key operating measures and growth
rates for the fourth quarter of 2019, as compared to the third
quarter of 2019 (sequential quarter) and fourth quarter of 2018
(linked quarter), are shown in the table below:
|
|
|
|
|
|
% or(4)
basis point (bp)
change from
3nd Quarter
2019 |
|
% or
basis point (bp)
change from
4rd Quarter
2018 |
|
Three Months Ended |
|
(Dollars in thousands, except per share data) |
Dec 31, 2019 |
|
Sep 30, 2019 |
|
Dec 31, 2018 |
|
Net income |
$ |
85,964 |
|
|
$ |
99,121 |
|
|
$ |
79,657 |
|
(13 |
)% |
|
8 |
% |
Net
income per common share – diluted |
1.44 |
|
|
1.69 |
|
|
1.35 |
|
(15 |
) |
|
7 |
|
Net
revenue (1) |
374,099 |
|
|
379,989 |
|
|
329,396 |
|
(2 |
) |
|
14 |
|
Net
interest income |
261,879 |
|
|
264,852 |
|
|
254,088 |
|
(1 |
) |
|
3 |
|
Net
interest margin |
3.17 |
% |
|
3.37 |
% |
|
3.61 |
% |
(20 |
)bp |
|
(44 |
)bp |
Net
interest margin - fully taxable equivalent (non-GAAP)
(2) |
3.19 |
|
|
3.39 |
|
|
3.63 |
|
(20 |
) |
|
(44 |
) |
Net
overhead ratio (3) |
1.53 |
|
|
1.40 |
|
|
1.79 |
|
13 |
|
|
(26 |
) |
Return on
average assets |
0.96 |
|
|
1.16 |
|
|
1.05 |
|
(20 |
) |
|
(9 |
) |
Return on
average common equity |
9.52 |
|
|
11.42 |
|
|
10.01 |
|
(190 |
) |
|
(49 |
) |
Return on average tangible common equity (non-GAAP)
(2) |
12.17 |
|
|
14.36 |
|
|
12.48 |
|
(219 |
) |
|
(31 |
) |
At end of period |
|
|
|
|
|
|
|
|
Total assets |
$ |
36,620,583 |
|
|
$ |
34,911,902 |
|
|
$ |
31,244,849 |
|
19 |
% |
|
17 |
% |
Total
loans (5) |
26,800,290 |
|
|
25,710,171 |
|
|
23,820,691 |
|
17 |
|
|
13 |
|
Total
deposits |
30,107,138 |
|
|
28,710,379 |
|
|
26,094,678 |
|
19 |
|
|
15 |
|
Total shareholders’ equity |
3,691,250 |
|
|
3,540,325 |
|
|
3,267,570 |
|
17 |
|
|
13 |
|
(1) |
Net revenue is net interest income plus non-interest
income. |
(2) |
See "Supplemental Non-GAAP Financial Measures/Ratios" at
Table 18 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) |
Period-end balance sheet percentage changes are
annualized. |
(5) |
Excludes mortgage loans held-for-sale. |
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 website at www.wintrust.com by
choosing “Financial Reports” under the “Investor Relations”
heading, and then choosing “Financial Highlights.”
WINTRUST FINANCIAL
CORPORATION
Selected Financial Highlights
|
Three Months Ended |
Years Ended |
(Dollars in thousands, except per share data) |
Dec 31, 2019 |
|
Sep 30, 2019 |
|
Jun 30, 2019 |
|
Mar 31, 2019 |
|
Dec 31, 2018 |
Dec 31, 2019 |
|
Dec 31, 2018 |
Selected Financial Condition Data (at end of
period): |
|
|
|
Total
assets |
$ |
36,620,583 |
|
|
$ |
34,911,902 |
|
|
$ |
33,641,769 |
|
|
$ |
32,358,621 |
|
|
$ |
31,244,849 |
|
|
|
|
Total
loans (1) |
26,800,290 |
|
|
25,710,171 |
|
|
25,304,659 |
|
|
24,214,629 |
|
|
23,820,691 |
|
|
|
|
Total
deposits |
30,107,138 |
|
|
28,710,379 |
|
|
27,518,815 |
|
|
26,804,742 |
|
|
26,094,678 |
|
|
|
|
Junior
subordinated debentures |
253,566 |
|
|
253,566 |
|
|
253,566 |
|
|
253,566 |
|
|
253,566 |
|
|
|
|
Total shareholders’ equity |
3,691,250 |
|
|
3,540,325 |
|
|
3,446,950 |
|
|
3,371,972 |
|
|
3,267,570 |
|
|
|
|
Selected Statements of Income Data: |
|
|
|
Net interest income |
$ |
261,879 |
|
|
$ |
264,852 |
|
|
$ |
266,202 |
|
|
$ |
261,986 |
|
|
$ |
254,088 |
|
$ |
1,054,919 |
|
|
$ |
964,903 |
|
Net
revenue (2) |
374,099 |
|
|
379,989 |
|
|
364,360 |
|
|
343,643 |
|
|
329,396 |
|
1,462,091 |
|
|
1,321,053 |
|
Net
income |
85,964 |
|
|
99,121 |
|
|
81,466 |
|
|
89,146 |
|
|
79,657 |
|
355,697 |
|
|
343,166 |
|
Net
income per common share – Basic |
1.46 |
|
|
1.71 |
|
|
1.40 |
|
|
1.54 |
|
|
1.38 |
|
6.11 |
|
|
5.95 |
|
Net income per common share – Diluted |
1.44 |
|
|
1.69 |
|
|
1.38 |
|
|
1.52 |
|
|
1.35 |
|
6.03 |
|
|
5.86 |
|
Selected Financial Ratios and Other Data: |
|
|
|
Performance Ratios: |
|
|
|
Net
interest margin |
3.17 |
% |
|
3.37 |
% |
|
3.62 |
% |
|
3.70 |
% |
|
3.61 |
% |
3.45 |
% |
|
3.59 |
% |
Net
interest margin - fully taxable equivalent (non-GAAP)
(3) |
3.19 |
|
|
3.39 |
|
|
3.64 |
|
|
3.72 |
|
|
3.63 |
|
3.47 |
|
|
3.61 |
|
Non-interest income to average assets |
1.25 |
|
|
1.35 |
|
|
1.23 |
|
|
1.06 |
|
|
0.99 |
|
1.23 |
|
|
1.23 |
|
Non-interest expense to average assets |
2.78 |
|
|
2.74 |
|
|
2.87 |
|
|
2.79 |
|
|
2.78 |
|
2.79 |
|
|
2.85 |
|
Net
overhead ratio (4) |
1.53 |
|
|
1.40 |
|
|
1.64 |
|
|
1.72 |
|
|
1.79 |
|
1.57 |
|
|
1.62 |
|
Return on
average assets |
0.96 |
|
|
1.16 |
|
|
1.02 |
|
|
1.16 |
|
|
1.05 |
|
1.07 |
|
|
1.18 |
|
Return on
average common equity |
9.52 |
|
|
11.42 |
|
|
9.68 |
|
|
11.09 |
|
|
10.01 |
|
10.41 |
|
|
11.26 |
|
Return on
average tangible common equity (non-GAAP) (3) |
12.17 |
|
|
14.36 |
|
|
12.28 |
|
|
14.14 |
|
|
12.48 |
|
13.22 |
|
|
13.95 |
|
Average
total assets |
$ |
35,645,190 |
|
|
$ |
33,954,592 |
|
|
$ |
32,055,769 |
|
|
$ |
31,216,171 |
|
|
$ |
30,179,887 |
|
$ |
33,232,083 |
|
|
$ |
29,028,420 |
|
Average
total shareholders’ equity |
3,622,184 |
|
|
3,496,714 |
|
|
3,414,340 |
|
|
3,309,078 |
|
|
3,200,654 |
|
3,461,535 |
|
|
3,098,740 |
|
Average
loans to average deposits ratio |
88.8 |
% |
|
90.6 |
% |
|
93.9 |
% |
|
92.7 |
% |
|
92.4 |
% |
91.4 |
% |
|
93.7 |
% |
Period-end loans to deposits ratio |
89.0 |
|
|
89.6 |
|
|
92.0 |
|
|
90.3 |
|
|
91.3 |
|
|
|
|
Common Share Data at end of period: |
|
|
|
Market
price per common share |
$ |
70.90 |
|
|
$ |
64.63 |
|
|
$ |
73.16 |
|
|
$ |
67.33 |
|
|
$ |
66.49 |
|
|
|
|
Book
value per common share |
61.68 |
|
|
60.24 |
|
|
58.62 |
|
|
57.33 |
|
|
55.71 |
|
|
|
|
Tangible
book value per common share (non-GAAP) (3) |
49.70 |
|
|
49.16 |
|
|
47.48 |
|
|
46.38 |
|
|
44.67 |
|
|
|
|
Common shares outstanding |
57,821,891 |
|
|
56,698,429 |
|
|
56,667,846 |
|
|
56,638,968 |
|
|
56,407,558 |
|
|
|
|
Other
Data at end of period: |
|
|
|
Tier 1
leverage ratio (5) |
8.6 |
% |
|
8.8 |
% |
|
9.1 |
% |
|
9.1 |
% |
|
9.1 |
% |
|
|
|
Risk-based capital ratios: |
|
|
|
|
|
|
|
|
|
|
|
|
Tier 1
capital ratio (5) |
9.5 |
|
|
9.7 |
|
|
9.6 |
|
|
9.8 |
|
|
9.7 |
|
|
|
|
Common
equity tier 1 capital ratio(5) |
9.2 |
|
|
9.3 |
|
|
9.2 |
|
|
9.3 |
|
|
9.3 |
|
|
|
|
Total
capital ratio (5) |
12.1 |
|
|
12.4 |
|
|
12.4 |
|
|
11.7 |
|
|
11.6 |
|
|
|
|
Allowance
for credit losses (6) |
$ |
158,461 |
|
|
$ |
163,273 |
|
|
$ |
161,901 |
|
|
$ |
159,622 |
|
|
$ |
154,164 |
|
|
|
|
Non-performing loans |
117,588 |
|
|
114,284 |
|
|
113,447 |
|
|
117,586 |
|
|
113,234 |
|
|
|
|
Allowance
for credit losses to total loans (6) |
0.59 |
% |
|
0.64 |
% |
|
0.64 |
% |
|
0.66 |
% |
|
0.65 |
% |
|
|
|
Non-performing loans to total loans |
0.44 |
|
|
0.44 |
|
|
0.45 |
|
|
0.49 |
|
|
0.48 |
|
|
|
|
Number
of: |
|
|
|
|
|
|
|
|
|
|
|
|
Bank subsidiaries |
15 |
|
|
15 |
|
|
15 |
|
|
15 |
|
|
15 |
|
|
|
|
Banking offices |
187 |
|
|
174 |
|
|
172 |
|
|
170 |
|
|
167 |
|
|
|
|
(1) |
Excludes mortgage loans held-for-sale. |
(2) |
Net revenue includes net interest income and non-interest
income. |
(3) |
See “Supplemental Non-GAAP Financial Measures/Ratios” at
Table 18 for additional information on this performance
measure/ratio. |
(4) |
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. |
(5) |
Capital ratios for current quarter-end are
estimated. |
(6) |
The allowance for credit losses includes both the
allowance for loan losses and the allowance for unfunded
lending-related commitments. |
WINTRUST FINANCIAL CORPORATION AND
SUBSIDIARIES
CONSOLIDATED STATEMENTS OF
CONDITION
|
(Unaudited) |
|
(Unaudited) |
|
(Unaudited) |
|
(Unaudited) |
|
|
|
Dec 31, |
|
Sep 30, |
|
Jun 30, |
|
Mar 31, |
|
Dec 31, |
(In
thousands) |
2019 |
|
2019 |
|
2019 |
|
2019 |
|
2018 |
Assets |
|
|
|
|
|
|
|
|
|
Cash and due from banks |
$ |
286,167 |
|
|
$ |
448,755 |
|
|
$ |
300,934 |
|
|
$ |
270,765 |
|
|
$ |
392,142 |
|
Federal
funds sold and securities purchased under resale agreements |
309 |
|
|
59 |
|
|
58 |
|
|
58 |
|
|
58 |
|
Interest
bearing deposits with banks |
2,164,560 |
|
|
2,260,806 |
|
|
1,437,105 |
|
|
1,609,852 |
|
|
1,099,594 |
|
Available-for-sale securities, at fair value |
3,106,214 |
|
|
2,270,059 |
|
|
2,186,154 |
|
|
2,185,782 |
|
|
2,126,081 |
|
Held-to-maturity securities, at amortized cost |
1,134,400 |
|
|
1,095,802 |
|
|
1,191,634 |
|
|
1,051,542 |
|
|
1,067,439 |
|
Trading
account securities |
1,068 |
|
|
3,204 |
|
|
2,430 |
|
|
559 |
|
|
1,692 |
|
Equity
securities with readily determinable fair value |
50,840 |
|
|
46,086 |
|
|
44,319 |
|
|
47,653 |
|
|
34,717 |
|
Federal
Home Loan Bank and Federal Reserve Bank stock |
100,739 |
|
|
92,714 |
|
|
92,026 |
|
|
89,013 |
|
|
91,354 |
|
Brokerage
customer receivables |
16,573 |
|
|
14,943 |
|
|
13,569 |
|
|
14,219 |
|
|
12,609 |
|
Mortgage
loans held-for-sale |
377,313 |
|
|
464,727 |
|
|
394,975 |
|
|
248,557 |
|
|
264,070 |
|
Loans,
net of unearned income |
26,800,290 |
|
|
25,710,171 |
|
|
25,304,659 |
|
|
24,214,629 |
|
|
23,820,691 |
|
Allowance
for loan losses |
(156,828 |
) |
|
(161,763 |
) |
|
(160,421 |
) |
|
(158,212 |
) |
|
(152,770 |
) |
Net loans |
26,643,462 |
|
|
25,548,408 |
|
|
25,144,238 |
|
|
24,056,417 |
|
|
23,667,921 |
|
Premises
and equipment, net |
754,328 |
|
|
721,856 |
|
|
711,214 |
|
|
676,037 |
|
|
671,169 |
|
Lease
investments, net |
231,192 |
|
|
228,647 |
|
|
230,111 |
|
|
224,240 |
|
|
233,208 |
|
Accrued
interest receivable and other assets |
1,061,141 |
|
|
1,087,864 |
|
|
1,023,896 |
|
|
888,492 |
|
|
696,707 |
|
Trade
date securities receivable |
— |
|
|
— |
|
|
237,607 |
|
|
375,211 |
|
|
263,523 |
|
Goodwill |
645,220 |
|
|
584,315 |
|
|
584,911 |
|
|
573,658 |
|
|
573,141 |
|
Other
intangible assets |
47,057 |
|
|
43,657 |
|
|
46,588 |
|
|
46,566 |
|
|
49,424 |
|
Total assets |
$ |
36,620,583 |
|
|
$ |
34,911,902 |
|
|
$ |
33,641,769 |
|
|
$ |
32,358,621 |
|
|
$ |
31,244,849 |
|
Liabilities and Shareholders’ Equity |
|
|
|
|
|
|
|
|
|
Deposits: |
|
|
|
|
|
|
|
|
|
Non-interest bearing |
$ |
7,216,758 |
|
|
$ |
7,067,960 |
|
|
$ |
6,719,958 |
|
|
$ |
6,353,456 |
|
|
$ |
6,569,880 |
|
Interest bearing |
22,890,380 |
|
|
21,642,419 |
|
|
20,798,857 |
|
|
20,451,286 |
|
|
19,524,798 |
|
Total deposits |
30,107,138 |
|
|
28,710,379 |
|
|
27,518,815 |
|
|
26,804,742 |
|
|
26,094,678 |
|
Federal
Home Loan Bank advances |
674,870 |
|
|
574,847 |
|
|
574,823 |
|
|
576,353 |
|
|
426,326 |
|
Other
borrowings |
418,174 |
|
|
410,488 |
|
|
418,057 |
|
|
372,194 |
|
|
393,855 |
|
Subordinated notes |
436,095 |
|
|
435,979 |
|
|
436,021 |
|
|
139,235 |
|
|
139,210 |
|
Junior
subordinated debentures |
253,566 |
|
|
253,566 |
|
|
253,566 |
|
|
253,566 |
|
|
253,566 |
|
Trade
date securities payable |
— |
|
|
226 |
|
|
— |
|
|
— |
|
|
— |
|
Accrued
interest payable and other liabilities |
1,039,490 |
|
|
986,092 |
|
|
993,537 |
|
|
840,559 |
|
|
669,644 |
|
Total liabilities |
32,929,333 |
|
|
31,371,577 |
|
|
30,194,819 |
|
|
28,986,649 |
|
|
27,977,279 |
|
Shareholders’ Equity: |
|
|
|
|
|
|
|
|
|
Preferred stock |
125,000 |
|
|
125,000 |
|
|
125,000 |
|
|
125,000 |
|
|
125,000 |
|
Common stock |
57,951 |
|
|
56,825 |
|
|
56,794 |
|
|
56,765 |
|
|
56,518 |
|
Surplus |
1,650,278 |
|
|
1,574,011 |
|
|
1,569,969 |
|
|
1,565,185 |
|
|
1,557,984 |
|
Treasury stock |
(6,931 |
) |
|
(6,799 |
) |
|
(6,650 |
) |
|
(6,650 |
) |
|
(5,634 |
) |
Retained earnings |
1,899,630 |
|
|
1,830,165 |
|
|
1,747,266 |
|
|
1,682,016 |
|
|
1,610,574 |
|
Accumulated other comprehensive loss |
(34,678 |
) |
|
(38,877 |
) |
|
(45,429 |
) |
|
(50,344 |
) |
|
(76,872 |
) |
Total shareholders’ equity |
3,691,250 |
|
|
3,540,325 |
|
|
3,446,950 |
|
|
3,371,972 |
|
|
3,267,570 |
|
Total liabilities and shareholders’ equity |
$ |
36,620,583 |
|
|
$ |
34,911,902 |
|
|
$ |
33,641,769 |
|
|
$ |
32,358,621 |
|
|
$ |
31,244,849 |
|
WINTRUST FINANCIAL CORPORATION AND
SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
|
Three Months Ended |
|
Years Ended |
(In
thousands, except per share data) |
Dec 31, 2019 |
|
Sep 30, 2019 |
|
Jun 30, 2019 |
|
Mar 31, 2019 |
|
Dec 31, 2018 |
|
Dec 31, 2019 |
|
Dec 31, 2018 |
Interest income |
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest and fees on loans |
$ |
308,055 |
|
|
$ |
314,277 |
|
|
$ |
309,161 |
|
|
$ |
296,987 |
|
|
$ |
283,311 |
|
|
$ |
1,228,480 |
|
|
$ |
1,044,502 |
|
Mortgage loans held-for-sale |
3,201 |
|
|
3,478 |
|
|
3,104 |
|
|
2,209 |
|
|
3,409 |
|
|
11,992 |
|
|
15,738 |
|
Interest bearing deposits with banks |
8,971 |
|
|
10,326 |
|
|
5,206 |
|
|
5,300 |
|
|
5,628 |
|
|
29,803 |
|
|
17,090 |
|
Federal funds sold and securities purchased under resale
agreements |
390 |
|
|
310 |
|
|
— |
|
|
— |
|
|
— |
|
|
700 |
|
|
1 |
|
Investment securities |
27,611 |
|
|
24,758 |
|
|
27,721 |
|
|
27,956 |
|
|
26,656 |
|
|
108,046 |
|
|
87,382 |
|
Trading account securities |
6 |
|
|
20 |
|
|
5 |
|
|
8 |
|
|
14 |
|
|
39 |
|
|
43 |
|
Federal Home Loan Bank and Federal Reserve Bank stock |
1,328 |
|
|
1,294 |
|
|
1,439 |
|
|
1,355 |
|
|
1,343 |
|
|
5,416 |
|
|
5,331 |
|
Brokerage customer receivables |
169 |
|
|
164 |
|
|
178 |
|
|
155 |
|
|
235 |
|
|
666 |
|
|
723 |
|
Total interest income |
349,731 |
|
|
354,627 |
|
|
346,814 |
|
|
333,970 |
|
|
320,596 |
|
|
1,385,142 |
|
|
1,170,810 |
|
Interest expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest on deposits |
74,724 |
|
|
76,168 |
|
|
67,024 |
|
|
60,976 |
|
|
55,975 |
|
|
278,892 |
|
|
166,553 |
|
Interest on Federal Home Loan Bank advances |
1,461 |
|
|
1,774 |
|
|
4,193 |
|
|
2,450 |
|
|
2,563 |
|
|
9,878 |
|
|
12,412 |
|
Interest on other borrowings |
3,273 |
|
|
3,466 |
|
|
3,525 |
|
|
3,633 |
|
|
3,199 |
|
|
13,897 |
|
|
8,599 |
|
Interest on subordinated notes |
5,504 |
|
|
5,470 |
|
|
2,806 |
|
|
1,775 |
|
|
1,788 |
|
|
15,555 |
|
|
7,121 |
|
Interest on junior subordinated debentures |
2,890 |
|
|
2,897 |
|
|
3,064 |
|
|
3,150 |
|
|
2,983 |
|
|
12,001 |
|
|
11,222 |
|
Total interest expense |
87,852 |
|
|
89,775 |
|
|
80,612 |
|
|
71,984 |
|
|
66,508 |
|
|
330,223 |
|
|
205,907 |
|
Net interest income |
261,879 |
|
|
264,852 |
|
|
266,202 |
|
|
261,986 |
|
|
254,088 |
|
|
1,054,919 |
|
|
964,903 |
|
Provision
for credit losses |
7,826 |
|
|
10,834 |
|
|
24,580 |
|
|
10,624 |
|
|
10,401 |
|
|
53,864 |
|
|
34,832 |
|
Net
interest income after provision for credit losses |
254,053 |
|
|
254,018 |
|
|
241,622 |
|
|
251,362 |
|
|
243,687 |
|
|
1,001,055 |
|
|
930,071 |
|
Non-interest income |
|
|
|
|
|
|
|
|
|
|
|
|
|
Wealth management |
24,999 |
|
|
23,999 |
|
|
24,139 |
|
|
23,977 |
|
|
22,726 |
|
|
97,114 |
|
|
90,963 |
|
Mortgage banking |
47,860 |
|
|
50,864 |
|
|
37,411 |
|
|
18,158 |
|
|
24,182 |
|
|
154,293 |
|
|
136,990 |
|
Service charges on deposit accounts |
10,973 |
|
|
9,972 |
|
|
9,277 |
|
|
8,848 |
|
|
9,065 |
|
|
39,070 |
|
|
36,404 |
|
Gains (losses) on investment securities, net |
587 |
|
|
710 |
|
|
864 |
|
|
1,364 |
|
|
(2,649 |
) |
|
3,525 |
|
|
(2,898 |
) |
Fees from covered call options |
1,243 |
|
|
— |
|
|
643 |
|
|
1,784 |
|
|
626 |
|
|
3,670 |
|
|
3,519 |
|
Trading gains (losses), net |
46 |
|
|
11 |
|
|
(44 |
) |
|
(171 |
) |
|
(155 |
) |
|
(158 |
) |
|
11 |
|
Operating lease income, net |
12,487 |
|
|
12,025 |
|
|
11,733 |
|
|
10,796 |
|
|
10,882 |
|
|
47,041 |
|
|
38,451 |
|
Other |
14,025 |
|
|
17,556 |
|
|
14,135 |
|
|
16,901 |
|
|
10,631 |
|
|
62,617 |
|
|
52,710 |
|
Total non-interest income |
112,220 |
|
|
115,137 |
|
|
98,158 |
|
|
81,657 |
|
|
75,308 |
|
|
407,172 |
|
|
356,150 |
|
Non-interest expense |
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries and employee benefits |
145,941 |
|
|
141,024 |
|
|
133,732 |
|
|
125,723 |
|
|
122,111 |
|
|
546,420 |
|
|
480,077 |
|
Equipment |
14,485 |
|
|
13,314 |
|
|
12,759 |
|
|
11,770 |
|
|
11,523 |
|
|
52,328 |
|
|
42,949 |
|
Operating lease equipment |
9,766 |
|
|
8,907 |
|
|
8,768 |
|
|
8,319 |
|
|
8,462 |
|
|
35,760 |
|
|
29,305 |
|
Occupancy, net |
17,132 |
|
|
14,991 |
|
|
15,921 |
|
|
16,245 |
|
|
15,980 |
|
|
64,289 |
|
|
57,814 |
|
Data processing |
7,569 |
|
|
6,522 |
|
|
6,204 |
|
|
7,525 |
|
|
8,447 |
|
|
27,820 |
|
|
35,027 |
|
Advertising and marketing |
12,517 |
|
|
13,375 |
|
|
12,845 |
|
|
9,858 |
|
|
9,414 |
|
|
48,595 |
|
|
41,140 |
|
Professional fees |
7,650 |
|
|
8,037 |
|
|
6,228 |
|
|
5,556 |
|
|
9,259 |
|
|
27,471 |
|
|
32,306 |
|
Amortization of other intangible assets |
3,017 |
|
|
2,928 |
|
|
2,957 |
|
|
2,942 |
|
|
1,407 |
|
|
11,844 |
|
|
4,571 |
|
FDIC insurance |
1,348 |
|
|
148 |
|
|
4,127 |
|
|
3,576 |
|
|
4,044 |
|
|
9,199 |
|
|
17,209 |
|
OREO expense, net |
536 |
|
|
1,170 |
|
|
1,290 |
|
|
632 |
|
|
1,618 |
|
|
3,628 |
|
|
6,120 |
|
Other |
29,630 |
|
|
24,138 |
|
|
24,776 |
|
|
22,228 |
|
|
19,068 |
|
|
100,772 |
|
|
79,570 |
|
Total non-interest expense |
249,591 |
|
|
234,554 |
|
|
229,607 |
|
|
214,374 |
|
|
211,333 |
|
|
928,126 |
|
|
826,088 |
|
Income
before taxes |
116,682 |
|
|
134,601 |
|
|
110,173 |
|
|
118,645 |
|
|
107,662 |
|
|
480,101 |
|
|
460,133 |
|
Income
tax expense |
30,718 |
|
|
35,480 |
|
|
28,707 |
|
|
29,499 |
|
|
28,005 |
|
|
124,404 |
|
|
116,967 |
|
Net income |
$ |
85,964 |
|
|
$ |
99,121 |
|
|
$ |
81,466 |
|
|
$ |
89,146 |
|
|
$ |
79,657 |
|
|
$ |
355,697 |
|
|
$ |
343,166 |
|
Preferred
stock dividends |
2,050 |
|
|
2,050 |
|
|
2,050 |
|
|
2,050 |
|
|
2,050 |
|
|
8,200 |
|
|
8,200 |
|
Net income applicable to common shares |
$ |
83,914 |
|
|
$ |
97,071 |
|
|
$ |
79,416 |
|
|
$ |
87,096 |
|
|
$ |
77,607 |
|
|
$ |
347,497 |
|
|
$ |
334,966 |
|
Net income per common share - Basic |
$ |
1.46 |
|
|
$ |
1.71 |
|
|
$ |
1.40 |
|
|
$ |
1.54 |
|
|
$ |
1.38 |
|
|
$ |
6.11 |
|
|
$ |
5.95 |
|
Net income per common share - Diluted |
$ |
1.44 |
|
|
$ |
1.69 |
|
|
$ |
1.38 |
|
|
$ |
1.52 |
|
|
$ |
1.35 |
|
|
$ |
6.03 |
|
|
$ |
5.86 |
|
Cash dividends declared per common share |
$ |
0.25 |
|
|
$ |
0.25 |
|
|
$ |
0.25 |
|
|
$ |
0.25 |
|
|
$ |
0.19 |
|
|
$ |
1.00 |
|
|
$ |
0.76 |
|
Weighted
average common shares outstanding |
57,538 |
|
|
56,690 |
|
|
56,662 |
|
|
56,529 |
|
|
56,395 |
|
|
56,857 |
|
|
56,300 |
|
Dilutive
potential common shares |
874 |
|
|
773 |
|
|
699 |
|
|
699 |
|
|
892 |
|
|
762 |
|
|
908 |
|
Average common shares and dilutive common shares |
58,412 |
|
|
57,463 |
|
|
57,361 |
|
|
57,228 |
|
|
57,287 |
|
|
57,619 |
|
|
57,208 |
|
TABLE 1: LOAN PORTFOLIO MIX AND GROWTH
RATES
|
|
|
|
|
|
|
|
|
|
% Growth From |
(Dollars in thousands) |
Dec 31, 2019 |
|
Sep 30, 2019 |
|
Jun 30, 2019 |
|
Mar 31, 2019 |
|
Dec 31, 2018 |
Sep 30, 2019(1) |
|
Dec 31, 2018 |
Balance: |
|
|
|
|
|
|
|
|
|
|
|
|
Commercial |
$ |
8,285,920 |
|
|
$ |
8,195,602 |
|
|
$ |
8,270,774 |
|
|
$ |
7,994,191 |
|
|
$ |
7,828,538 |
|
4 |
% |
|
6 |
% |
Commercial real estate |
8,020,276 |
|
|
7,448,667 |
|
|
7,276,244 |
|
|
6,973,505 |
|
|
6,933,252 |
|
30 |
|
|
16 |
|
Home equity |
513,066 |
|
|
512,303 |
|
|
527,370 |
|
|
528,448 |
|
|
552,343 |
|
1 |
|
|
(7 |
) |
Residential real estate |
1,354,221 |
|
|
1,218,666 |
|
|
1,118,178 |
|
|
1,053,524 |
|
|
1,002,464 |
|
44 |
|
|
35 |
|
Premium finance receivables - commercial |
3,442,027 |
|
|
3,449,950 |
|
|
3,368,423 |
|
|
2,988,788 |
|
|
2,841,659 |
|
(1 |
) |
|
21 |
|
Premium finance receivables - life insurance |
5,074,602 |
|
|
4,795,496 |
|
|
4,634,478 |
|
|
4,555,369 |
|
|
4,541,794 |
|
23 |
|
|
12 |
|
Consumer and other |
110,178 |
|
|
89,487 |
|
|
109,192 |
|
|
120,804 |
|
|
120,641 |
|
92 |
|
|
(9 |
) |
Total loans, net of unearned income |
$ |
26,800,290 |
|
|
$ |
25,710,171 |
|
|
$ |
25,304,659 |
|
|
$ |
24,214,629 |
|
|
$ |
23,820,691 |
|
17 |
% |
|
13 |
% |
Mix: |
|
|
|
|
|
|
|
|
|
|
|
|
Commercial |
31 |
% |
|
32 |
% |
|
33 |
% |
|
33 |
% |
|
33 |
% |
|
|
|
Commercial real estate |
30 |
|
|
29 |
|
|
29 |
|
|
29 |
|
|
29 |
|
|
|
|
Home equity |
2 |
|
|
2 |
|
|
2 |
|
|
2 |
|
|
2 |
|
|
|
|
Residential real estate |
5 |
|
|
5 |
|
|
4 |
|
|
4 |
|
|
4 |
|
|
|
|
Premium finance receivables - commercial |
13 |
|
|
13 |
|
|
13 |
|
|
12 |
|
|
12 |
|
|
|
|
Premium finance receivables - life insurance |
19 |
|
|
19 |
|
|
18 |
|
|
19 |
|
|
19 |
|
|
|
|
Consumer and other |
— |
|
|
— |
|
|
1 |
|
|
1 |
|
|
1 |
|
|
|
|
Total loans, net of unearned income |
100 |
% |
|
100 |
% |
|
100 |
% |
|
100 |
% |
|
100 |
% |
|
|
|
(1) Annualized. |
TABLE 2: COMMERCIAL AND COMMERCIAL REAL
ESTATE LOAN PORTFOLIOS
|
As of December 31, 2019 |
|
|
|
% of
Total
Balance |
|
Nonaccrual |
|
> 90 Days
Past Due
and Still
Accruing |
|
Allowance
For Loan
Losses
Allocation |
|
|
|
(Dollars in thousands) |
Balance |
|
Commercial: |
|
|
|
|
|
|
|
|
|
Commercial, industrial and other |
$ |
5,159,805 |
|
|
31.7 |
% |
|
$ |
33,983 |
|
|
$ |
— |
|
|
$ |
44,230 |
|
Franchise |
937,482 |
|
|
5.7 |
|
|
2,391 |
|
|
— |
|
|
7,976 |
|
Mortgage warehouse lines of credit |
292,781 |
|
|
1.8 |
|
|
— |
|
|
— |
|
|
2,166 |
|
Asset-based lending |
989,018 |
|
|
6.1 |
|
|
128 |
|
|
— |
|
|
7,871 |
|
Leases |
878,528 |
|
|
5.4 |
|
|
722 |
|
|
— |
|
|
2,647 |
|
PCI - commercial loans (1) |
28,306 |
|
|
0.2 |
|
|
— |
|
|
1,855 |
|
|
30 |
|
Total commercial |
$ |
8,285,920 |
|
|
50.9 |
% |
|
$ |
37,224 |
|
|
$ |
1,855 |
|
|
$ |
64,920 |
|
Commercial Real Estate: |
|
|
|
|
|
|
|
|
|
Construction |
$ |
1,023,300 |
|
|
6.3 |
% |
|
$ |
1,030 |
|
|
$ |
— |
|
|
$ |
10,006 |
|
Land |
177,483 |
|
|
1.1 |
|
|
1,082 |
|
|
— |
|
|
4,779 |
|
Office |
1,044,769 |
|
|
6.4 |
|
|
8,034 |
|
|
— |
|
|
9,903 |
|
Industrial |
1,032,866 |
|
|
6.3 |
|
|
99 |
|
|
— |
|
|
6,724 |
|
Retail |
1,097,930 |
|
|
6.7 |
|
|
6,789 |
|
|
— |
|
|
6,738 |
|
Multi-family |
1,311,542 |
|
|
8.0 |
|
|
913 |
|
|
— |
|
|
12,528 |
|
Mixed use and other |
2,094,946 |
|
|
12.8 |
|
|
8,166 |
|
|
— |
|
|
16,086 |
|
PCI - commercial real estate (1) |
237,440 |
|
|
1.5 |
|
|
— |
|
|
14,946 |
|
|
114 |
|
Total commercial real estate |
$ |
8,020,276 |
|
|
49.1 |
% |
|
$ |
26,113 |
|
|
$ |
14,946 |
|
|
$ |
66,878 |
|
Total commercial and commercial real estate |
$ |
16,306,196 |
|
|
100.0 |
% |
|
$ |
63,337 |
|
|
$ |
16,801 |
|
|
$ |
131,798 |
|
|
|
|
|
|
|
|
|
|
|
Commercial real estate - collateral location by
state: |
|
|
|
|
|
|
|
|
|
Illinois |
$ |
6,176,353 |
|
|
77.0 |
% |
|
|
|
|
|
|
Wisconsin |
744,975 |
|
|
9.3 |
|
|
|
|
|
|
|
Total primary markets |
$ |
6,921,328 |
|
|
86.3 |
% |
|
|
|
|
|
|
Indiana |
218,963 |
|
|
2.7 |
|
|
|
|
|
|
|
Florida |
114,629 |
|
|
1.4 |
|
|
|
|
|
|
|
Arizona |
64,022 |
|
|
0.8 |
|
|
|
|
|
|
|
California |
64,345 |
|
|
0.8 |
|
|
|
|
|
|
|
Other |
636,989 |
|
|
8.0 |
|
|
|
|
|
|
|
Total commercial real estate |
$ |
8,020,276 |
|
|
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. |
TABLE 3: DEPOSIT PORTFOLIO MIX AND
GROWTH RATES
|
|
|
|
|
|
|
|
|
|
% Growth From |
(Dollars in thousands) |
Dec 31, 2019 |
|
Sep 30, 2019 |
|
Jun 30, 2019 |
|
Mar 31, 2019 |
|
Dec 31, 2018 |
Sep 30, 2019 (1) |
|
Dec 31, 2018 |
Balance: |
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest bearing |
$ |
7,216,758 |
|
|
$ |
7,067,960 |
|
|
$ |
6,719,958 |
|
|
$ |
6,353,456 |
|
|
$ |
6,569,880 |
|
8 |
% |
|
10 |
% |
NOW and interest bearing demand deposits |
3,093,159 |
|
|
2,966,098 |
|
|
2,788,976 |
|
|
2,948,576 |
|
|
2,897,133 |
|
17 |
|
|
7 |
|
Wealth management deposits (2) |
3,123,063 |
|
|
2,795,838 |
|
|
3,220,256 |
|
|
3,328,781 |
|
|
2,996,764 |
|
46 |
|
|
4 |
|
Money market |
7,854,189 |
|
|
7,326,899 |
|
|
6,460,098 |
|
|
6,093,596 |
|
|
5,704,866 |
|
29 |
|
|
38 |
|
Savings |
3,196,698 |
|
|
2,934,348 |
|
|
2,823,904 |
|
|
2,729,626 |
|
|
2,665,194 |
|
35 |
|
|
20 |
|
Time certificates of deposit |
5,623,271 |
|
|
5,619,236 |
|
|
5,505,623 |
|
|
5,350,707 |
|
|
5,260,841 |
|
— |
|
|
7 |
|
Total deposits |
$ |
30,107,138 |
|
|
$ |
28,710,379 |
|
|
$ |
27,518,815 |
|
|
$ |
26,804,742 |
|
|
$ |
26,094,678 |
|
19 |
% |
|
15 |
% |
Mix: |
|
|
|
|
|
|
|
|
|
|
|
|
Non-interest bearing |
24 |
% |
|
25 |
% |
|
24 |
% |
|
24 |
% |
|
25 |
% |
|
|
|
NOW and interest bearing demand deposits |
10 |
|
|
10 |
|
|
10 |
|
|
11 |
|
|
11 |
|
|
|
|
Wealth management deposits (2) |
10 |
|
|
10 |
|
|
12 |
|
|
12 |
|
|
12 |
|
|
|
|
Money market |
26 |
|
|
25 |
|
|
24 |
|
|
23 |
|
|
22 |
|
|
|
|
Savings |
11 |
|
|
10 |
|
|
10 |
|
|
10 |
|
|
10 |
|
|
|
|
Time certificates of deposit |
19 |
|
|
20 |
|
|
20 |
|
|
20 |
|
|
20 |
|
|
|
|
Total deposits |
100 |
% |
|
100 |
% |
|
100 |
% |
|
100 |
% |
|
100 |
% |
|
|
|
(1) |
Annualized. |
(2) |
Represents deposit balances of the Company’s
subsidiary banks from brokerage customers of Wintrust Investments,
CDEC, trust and asset management customers of the Company and
brokerage customers from unaffiliated companies which have been
placed into deposit accounts. |
TABLE 4: TIME CERTIFICATES OF DEPOSIT MATURITY/RE-PRICING
ANALYSIS
As of December 31, 2019
(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 |
$ |
3,923 |
|
|
$ |
31,610 |
|
|
$ |
102,043 |
|
|
$ |
936,474 |
|
|
$ |
1,074,050 |
|
|
1.84 |
% |
4-6 months |
1,420 |
|
|
16,774 |
|
|
— |
|
|
1,235,449 |
|
|
1,253,643 |
|
|
2.13 |
|
7-9 months |
1,685 |
|
|
18,954 |
|
|
— |
|
|
570,523 |
|
|
591,162 |
|
|
1.96 |
|
10-12 months |
609 |
|
|
20,033 |
|
|
— |
|
|
482,719 |
|
|
503,361 |
|
|
1.71 |
|
13-18 months |
— |
|
|
11,242 |
|
|
— |
|
|
1,378,718 |
|
|
1,389,960 |
|
|
2.42 |
|
19-24 months |
1,401 |
|
|
5,403 |
|
|
— |
|
|
625,445 |
|
|
632,249 |
|
|
2.56 |
|
24+ months |
88 |
|
|
4,538 |
|
|
— |
|
|
174,220 |
|
|
178,846 |
|
|
1.84 |
|
Total |
$ |
9,126 |
|
|
$ |
108,554 |
|
|
$ |
102,043 |
|
|
$ |
5,403,548 |
|
|
$ |
5,623,271 |
|
|
2.13 |
% |
(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. |
TABLE 5: QUARTERLY AVERAGE BALANCES
|
Average Balance for three months ended, |
|
Dec 31, |
|
Sep 30, |
|
Jun 30, |
|
Mar 31, |
|
Dec 31, |
(In
thousands) |
2019 |
|
2019 |
|
2019 |
|
2019 |
|
2018 |
Interest-bearing deposits with banks and cash equivalents
(1) |
$ |
2,206,251 |
|
|
$ |
1,960,898 |
|
|
$ |
893,332 |
|
|
$ |
897,629 |
|
|
$ |
1,042,860 |
|
Investment securities (2) |
3,909,699 |
|
|
3,410,090 |
|
|
3,653,580 |
|
|
3,630,577 |
|
|
3,347,496 |
|
FHLB and FRB stock |
94,843 |
|
|
92,583 |
|
|
105,491 |
|
|
94,882 |
|
|
98,084 |
|
Liquidity management assets (6) |
6,210,793 |
|
|
5,463,571 |
|
|
4,652,403 |
|
|
4,623,088 |
|
|
4,488,440 |
|
Other earning assets (3)(6) |
18,353 |
|
|
17,809 |
|
|
15,719 |
|
|
13,591 |
|
|
16,204 |
|
Mortgage loans held-for-sale |
381,878 |
|
|
379,870 |
|
|
281,732 |
|
|
188,190 |
|
|
265,717 |
|
Loans, net of unearned income (4)(6) |
26,137,722 |
|
|
25,346,290 |
|
|
24,553,263 |
|
|
23,880,916 |
|
|
23,164,154 |
|
Total earning assets (6) |
32,748,746 |
|
|
31,207,540 |
|
|
29,503,117 |
|
|
28,705,785 |
|
|
27,934,515 |
|
Allowance for loan losses |
(167,759 |
) |
|
(168,423 |
) |
|
(164,231 |
) |
|
(157,782 |
) |
|
(154,438 |
) |
Cash and due from banks |
316,631 |
|
|
297,475 |
|
|
273,679 |
|
|
283,019 |
|
|
271,403 |
|
Other assets |
2,747,572 |
|
|
2,618,000 |
|
|
2,443,204 |
|
|
2,385,149 |
|
|
2,128,407 |
|
Total assets |
$ |
35,645,190 |
|
|
$ |
33,954,592 |
|
|
$ |
32,055,769 |
|
|
$ |
31,216,171 |
|
|
$ |
30,179,887 |
|
|
|
|
|
|
|
|
|
|
|
NOW and interest bearing demand deposits |
$ |
3,016,991 |
|
|
$ |
2,912,961 |
|
|
$ |
2,878,021 |
|
|
$ |
2,803,338 |
|
|
$ |
2,671,283 |
|
Wealth management deposits |
2,934,292 |
|
|
2,888,817 |
|
|
2,605,690 |
|
|
2,614,035 |
|
|
2,289,904 |
|
Money market accounts |
7,647,635 |
|
|
6,956,755 |
|
|
6,095,285 |
|
|
5,915,525 |
|
|
5,632,268 |
|
Savings accounts |
3,028,763 |
|
|
2,837,039 |
|
|
2,752,828 |
|
|
2,715,422 |
|
|
2,553,133 |
|
Time deposits |
5,682,449 |
|
|
5,590,228 |
|
|
5,322,384 |
|
|
5,267,796 |
|
|
5,381,029 |
|
Interest-bearing deposits |
22,310,130 |
|
|
21,185,800 |
|
|
19,654,208 |
|
|
19,316,116 |
|
|
18,527,617 |
|
Federal Home Loan Bank advances |
596,594 |
|
|
574,833 |
|
|
869,812 |
|
|
594,335 |
|
|
551,846 |
|
Other borrowings |
415,092 |
|
|
416,300 |
|
|
419,064 |
|
|
465,571 |
|
|
385,878 |
|
Subordinated notes |
436,025 |
|
|
436,041 |
|
|
220,771 |
|
|
139,217 |
|
|
139,186 |
|
Junior subordinated debentures |
253,566 |
|
|
253,566 |
|
|
253,566 |
|
|
253,566 |
|
|
253,566 |
|
Total interest-bearing liabilities |
24,011,407 |
|
|
22,866,540 |
|
|
21,417,421 |
|
|
20,768,805 |
|
|
19,858,093 |
|
Non-interest bearing deposits |
7,128,166 |
|
|
6,776,786 |
|
|
6,487,627 |
|
|
6,444,378 |
|
|
6,542,228 |
|
Other liabilities |
883,433 |
|
|
814,552 |
|
|
736,381 |
|
|
693,910 |
|
|
578,912 |
|
Equity |
3,622,184 |
|
|
3,496,714 |
|
|
3,414,340 |
|
|
3,309,078 |
|
|
3,200,654 |
|
Total liabilities and shareholders’ equity |
$ |
35,645,190 |
|
|
$ |
33,954,592 |
|
|
$ |
32,055,769 |
|
|
$ |
31,216,171 |
|
|
$ |
30,179,887 |
|
|
|
|
|
|
|
|
|
|
|
Net free funds/contribution (5) |
$ |
8,737,339 |
|
|
$ |
8,341,000 |
|
|
$ |
8,085,696 |
|
|
$ |
7,936,980 |
|
|
$ |
8,076,422 |
|
(1) |
Includes interest-bearing deposits from banks, federal
funds sold and securities purchased under resale
agreements. |
(2) |
Investment securities includes investment securities
classified as available-for-sale and held-to-maturity, and equity
securities with readily determinable fair values. Equity securities
without readily determinable fair values are included within other
assets. |
(3) |
Other earning assets include brokerage customer
receivables and trading account securities. |
(4) |
Loans, net of unearned income, include non-accrual
loans. |
(5) |
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. |
(6) |
See "Supplemental Non-GAAP Financial Measures/Ratios"
at Table 18 for additional information on this performance
measure/ratio. |
TABLE 6: QUARTERLY NET INTEREST INCOME
|
Net Interest Income for three months ended, |
|
Dec 31, |
|
Sep 30, |
|
Jun 30, |
|
Mar 31, |
|
Dec 31, |
(In thousands) |
2019 |
|
2019 |
|
2019 |
|
2019 |
|
2018 |
Interest income: |
|
|
|
|
|
|
|
|
|
Interest-bearing deposits with banks and cash equivalents |
$ |
9,361 |
|
|
$ |
10,636 |
|
|
$ |
5,206 |
|
|
$ |
5,300 |
|
|
$ |
5,628 |
|
Investment securities |
28,184 |
|
|
25,332 |
|
|
28,290 |
|
|
28,521 |
|
|
27,242 |
|
FHLB and FRB stock |
1,328 |
|
|
1,294 |
|
|
1,439 |
|
|
1,355 |
|
|
1,343 |
|
Liquidity management assets (2) |
38,873 |
|
|
37,262 |
|
|
34,935 |
|
|
35,176 |
|
|
34,213 |
|
Other earning assets (2) |
176 |
|
|
189 |
|
|
184 |
|
|
165 |
|
|
253 |
|
Mortgage loans held-for-sale |
3,201 |
|
|
3,478 |
|
|
3,104 |
|
|
2,209 |
|
|
3,409 |
|
Loans, net of unearned income (2) |
308,947 |
|
|
315,255 |
|
|
310,191 |
|
|
298,021 |
|
|
284,291 |
|
Total interest income |
$ |
351,197 |
|
|
$ |
356,184 |
|
|
$ |
348,414 |
|
|
$ |
335,571 |
|
|
$ |
322,166 |
|
|
|
|
|
|
|
|
|
|
|
Interest expense: |
|
|
|
|
|
|
|
|
|
NOW and interest bearing demand deposits |
$ |
4,622 |
|
|
$ |
5,291 |
|
|
$ |
5,553 |
|
|
$ |
4,613 |
|
|
$ |
4,007 |
|
Wealth management deposits |
7,867 |
|
|
9,163 |
|
|
7,091 |
|
|
7,000 |
|
|
7,119 |
|
Money market accounts |
25,603 |
|
|
25,426 |
|
|
21,451 |
|
|
19,460 |
|
|
16,936 |
|
Savings accounts |
6,145 |
|
|
5,622 |
|
|
4,959 |
|
|
4,249 |
|
|
3,096 |
|
Time deposits |
30,487 |
|
|
30,666 |
|
|
27,970 |
|
|
25,654 |
|
|
24,817 |
|
Interest-bearing deposits |
74,724 |
|
|
76,168 |
|
|
67,024 |
|
|
60,976 |
|
|
55,975 |
|
Federal Home Loan Bank advances |
1,461 |
|
|
1,774 |
|
|
4,193 |
|
|
2,450 |
|
|
2,563 |
|
Other borrowings |
3,273 |
|
|
3,466 |
|
|
3,525 |
|
|
3,633 |
|
|
3,199 |
|
Subordinated notes |
5,504 |
|
|
5,470 |
|
|
2,806 |
|
|
1,775 |
|
|
1,788 |
|
Junior subordinated debentures |
2,890 |
|
|
2,897 |
|
|
3,064 |
|
|
3,150 |
|
|
2,983 |
|
Total interest expense |
$ |
87,852 |
|
|
$ |
89,775 |
|
|
$ |
80,612 |
|
|
$ |
71,984 |
|
|
$ |
66,508 |
|
|
|
|
|
|
|
|
|
|
|
Less: Fully taxable-equivalent adjustment |
(1,466 |
) |
|
(1,557 |
) |
|
(1,600 |
) |
|
(1,601 |
) |
|
(1,570 |
) |
Net interest income (GAAP) (1) |
261,879 |
|
|
264,852 |
|
|
266,202 |
|
|
261,986 |
|
|
254,088 |
|
Fully taxable-equivalent adjustment |
1,466 |
|
|
1,557 |
|
|
1,600 |
|
|
1,601 |
|
|
1,570 |
|
Net interest income, fully taxable-equivalent (non-GAAP)
(1) |
$ |
263,345 |
|
|
$ |
266,409 |
|
|
$ |
267,802 |
|
|
$ |
263,587 |
|
|
$ |
255,658 |
|
(1) |
See "Supplemental Non-GAAP Financial
Measures/Ratios" at Table 18 for additional information on this
performance measure/ratio. |
(2) |
Interest income on tax-advantaged loans, trading
securities and investment securities reflects a taxable-equivalent
adjustment based on the marginal federal corporate tax rate in
effect as of the applicable period. |
TABLE 7: QUARTERLY NET INTEREST MARGIN
|
Net Interest Margin for three months ended, |
|
Dec 31, 2019 |
|
Sep 30, 2019 |
|
Jun 30, 2019 |
|
Mar 31, 2019 |
|
Dec 31, 2018 |
Yield earned on: |
|
|
|
|
|
|
|
|
|
Interest-bearing deposits with banks and cash equivalents |
1.68 |
% |
|
2.15 |
% |
|
2.34 |
% |
|
2.39 |
% |
|
2.14 |
% |
Investment securities |
2.86 |
|
|
2.95 |
|
|
3.11 |
|
|
3.19 |
|
|
3.23 |
|
FHLB and FRB stock |
5.55 |
|
|
5.55 |
|
|
5.47 |
|
|
5.79 |
|
|
5.43 |
|
Liquidity management assets |
2.48 |
|
|
2.71 |
|
|
3.01 |
|
|
3.09 |
|
|
3.02 |
|
Other earning assets |
3.83 |
|
|
4.20 |
|
|
4.68 |
|
|
4.91 |
|
|
6.19 |
|
Mortgage loans held-for-sale |
3.33 |
|
|
3.63 |
|
|
4.42 |
|
|
4.76 |
|
|
5.09 |
|
Loans, net of unearned income |
4.69 |
|
|
4.93 |
|
|
5.07 |
|
|
5.06 |
|
|
4.87 |
|
Total earning assets |
4.25 |
% |
|
4.53 |
% |
|
4.74 |
% |
|
4.74 |
% |
|
4.58 |
% |
|
|
|
|
|
|
|
|
|
|
Rate paid on: |
|
|
|
|
|
|
|
|
|
NOW and interest bearing demand deposits |
0.61 |
% |
|
0.72 |
% |
|
0.77 |
% |
|
0.67 |
% |
|
0.60 |
% |
Wealth management deposits |
1.06 |
|
|
1.26 |
|
|
1.09 |
|
|
1.09 |
|
|
1.23 |
|
Money market accounts |
1.33 |
|
|
1.45 |
|
|
1.41 |
|
|
1.33 |
|
|
1.19 |
|
Savings accounts |
0.80 |
|
|
0.79 |
|
|
0.72 |
|
|
0.63 |
|
|
0.48 |
|
Time deposits |
2.13 |
|
|
2.18 |
|
|
2.11 |
|
|
1.98 |
|
|
1.83 |
|
Interest-bearing deposits |
1.33 |
|
|
1.43 |
|
|
1.37 |
|
|
1.29 |
|
|
1.20 |
|
Federal Home Loan Bank advances |
0.97 |
|
|
1.22 |
|
|
1.93 |
|
|
1.67 |
|
|
1.84 |
|
Other borrowings |
3.13 |
|
|
3.30 |
|
|
3.37 |
|
|
3.16 |
|
|
3.29 |
|
Subordinated notes |
5.05 |
|
|
5.02 |
|
|
5.08 |
|
|
5.10 |
|
|
5.14 |
|
Junior subordinated debentures |
4.46 |
|
|
4.47 |
|
|
4.78 |
|
|
4.97 |
|
|
4.60 |
|
Total interest-bearing liabilities |
1.45 |
% |
|
1.56 |
% |
|
1.51 |
% |
|
1.40 |
% |
|
1.33 |
% |
|
|
|
|
|
|
|
|
|
|
Interest rate spread (1)(3) |
2.80 |
% |
|
2.97 |
% |
|
3.23 |
% |
|
3.34 |
% |
|
3.25 |
% |
Less: Fully taxable-equivalent adjustment |
(0.02 |
) |
|
(0.02 |
) |
|
(0.02 |
) |
|
(0.02 |
) |
|
(0.02 |
) |
Net free funds/contribution (2) |
0.39 |
|
|
0.42 |
|
|
0.41 |
|
|
0.38 |
|
|
0.38 |
|
Net interest margin (GAAP) (3) |
3.17 |
% |
|
3.37 |
% |
|
3.62 |
% |
|
3.70 |
% |
|
3.61 |
% |
Fully taxable-equivalent adjustment |
0.02 |
|
|
0.02 |
|
|
0.02 |
|
|
0.02 |
|
|
0.02 |
|
Net interest margin, fully taxable-equivalent (non-GAAP)
(3) |
3.19 |
% |
|
3.39 |
% |
|
3.64 |
% |
|
3.72 |
% |
|
3.63 |
% |
(1) |
Interest rate spread is the difference between the yield
earned on earning assets and the rate paid on interest-bearing
liabilities. |
(2) |
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. |
(3) |
See "Supplemental Non-GAAP Financial Measures/Ratios"
at Table 18 for additional information on this performance
measure/ratio. |
TABLE 8: YEAR-TO-DATE AVERAGE BALANCES,
AND NET INTEREST INCOME AND MARGIN
|
Average Balance for years ended, |
Interest for years ended, |
Yield/Rate for years ended, |
(Dollars in thousands) |
Dec 31, 2019 |
|
Dec 31, 2018 |
Dec 31, 2019 |
|
Dec 31, 2018 |
Dec 31, 2019 |
|
Dec 31, 2018 |
Interest-bearing deposits with banks and cash equivalents
(1) |
$ |
1,494,418 |
|
|
$ |
888,671 |
|
$ |
30,503 |
|
|
$ |
17,091 |
|
2.04 |
% |
|
1.92 |
% |
Investment securities (2) |
3,651,091 |
|
|
3,045,555 |
|
110,326 |
|
|
89,640 |
|
3.02 |
|
|
2.94 |
|
FHLB and FRB stock |
96,924 |
|
|
101,681 |
|
5,416 |
|
|
5,331 |
|
5.59 |
|
|
5.24 |
|
Liquidity management assets (3)(8) |
$ |
5,242,433 |
|
|
$ |
4,035,907 |
|
$ |
146,245 |
|
|
$ |
112,062 |
|
2.79 |
% |
|
2.78 |
% |
Other earning assets (3)(4)(8) |
16,385 |
|
|
20,681 |
|
714 |
|
|
777 |
|
4.36 |
|
|
3.75 |
|
Mortgage loans held-for-sale |
308,645 |
|
|
332,863 |
|
11,992 |
|
|
15,738 |
|
3.89 |
|
|
4.73 |
|
Loans, net of unearned income (3)(5)(8) |
24,986,736 |
|
|
22,500,482 |
|
1,232,415 |
|
|
1,047,905 |
|
4.93 |
|
|
4.66 |
|
Total earning assets (8) |
$ |
30,554,199 |
|
|
$ |
26,889,933 |
|
$ |
1,391,366 |
|
|
$ |
1,176,482 |
|
4.55 |
% |
|
4.38 |
% |
Allowance for loan losses |
(164,587 |
) |
|
(148,342 |
) |
|
|
|
|
|
|
Cash and due from banks |
292,807 |
|
|
266,086 |
|
|
|
|
|
|
|
Other assets |
2,549,664 |
|
|
2,020,743 |
|
|
|
|
|
|
|
Total assets |
$ |
33,232,083 |
|
|
$ |
29,028,420 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NOW and interest bearing demand deposits |
$ |
2,903,441 |
|
|
$ |
2,436,791 |
|
$ |
20,079 |
|
|
$ |
9,773 |
|
0.69 |
% |
|
0.40 |
% |
Wealth management deposits |
2,761,936 |
|
|
2,356,145 |
|
31,121 |
|
|
27,839 |
|
1.13 |
|
|
1.18 |
|
Money market accounts |
6,659,376 |
|
|
5,105,244 |
|
91,940 |
|
|
42,973 |
|
1.38 |
|
|
0.84 |
|
Savings accounts |
2,834,381 |
|
|
2,684,661 |
|
20,975 |
|
|
11,444 |
|
0.74 |
|
|
0.43 |
|
Time deposits |
5,467,192 |
|
|
4,872,590 |
|
114,777 |
|
|
74,524 |
|
2.10 |
|
|
1.53 |
|
Interest-bearing deposits |
$ |
20,626,326 |
|
|
$ |
17,455,431 |
|
$ |
278,892 |
|
|
$ |
166,553 |
|
1.35 |
% |
|
0.95 |
% |
Federal Home Loan Bank advances |
658,669 |
|
|
713,539 |
|
9,878 |
|
|
12,412 |
|
1.50 |
|
|
1.74 |
|
Other borrowings |
428,834 |
|
|
289,615 |
|
13,897 |
|
|
8,599 |
|
3.24 |
|
|
2.97 |
|
Subordinated notes |
309,178 |
|
|
139,140 |
|
15,555 |
|
|
7,121 |
|
5.03 |
|
|
5.12 |
|
Junior subordinated debentures |
253,566 |
|
|
253,566 |
|
12,001 |
|
|
11,222 |
|
4.67 |
|
|
4.37 |
|
Total interest-bearing liabilities |
$ |
22,276,573 |
|
|
$ |
18,851,291 |
|
$ |
330,223 |
|
|
$ |
205,907 |
|
1.48 |
% |
|
1.09 |
% |
Non-interest bearing deposits |
6,711,298 |
|
|
6,545,251 |
|
|
|
|
|
|
|
Other liabilities |
782,677 |
|
|
533,138 |
|
|
|
|
|
|
|
Equity |
3,461,535 |
|
|
3,098,740 |
|
|
|
|
|
|
|
Total liabilities and shareholders’ equity |
$ |
33,232,083 |
|
|
$ |
29,028,420 |
|
|
|
|
|
|
|
Interest rate spread (6)(8) |
|
|
|
|
|
|
3.07 |
% |
|
3.29 |
% |
Less: Fully taxable-equivalent adjustment |
|
|
|
(6,224 |
) |
|
(5,672 |
) |
(0.02 |
) |
|
(0.02 |
) |
Net free funds/contribution (7) |
$ |
8,277,626 |
|
|
$ |
8,038,642 |
|
|
|
|
0.40 |
|
|
0.32 |
|
Net interest income/ margin (GAAP) (8) |
|
|
|
$ |
1,054,919 |
|
|
$ |
964,903 |
|
3.45 |
% |
|
3.59 |
% |
Fully taxable-equivalent adjustment |
|
|
|
6,224 |
|
|
5,672 |
|
0.02 |
|
|
0.02 |
|
Net interest income/ margin, fully taxable-equivalent (non-GAAP)
(8) |
|
|
|
$ |
1,061,143 |
|
|
$ |
970,575 |
|
3.47 |
% |
|
3.61 |
% |
(1) |
Includes interest-bearing deposits from banks, federal
funds sold and securities purchased under resale
agreements. |
(2) |
Investment securities includes investment securities
classified as available-for-sale and held-to-maturity, and equity
securities with readily determinable fair values. Equity securities
without readily determinable fair values are included within other
assets. |
(3) |
Interest income on tax-advantaged loans, trading
securities and investment securities reflects a taxable-equivalent
adjustment based on a marginal federal corporate tax rate in effect
as of the applicable period. |
(4) |
Other earning assets include brokerage customer
receivables and trading account securities. |
(5) |
Loans, net of unearned income, include non-accrual
loans. |
(6) |
Interest rate spread is the difference between the
yield earned on earning assets and the rate paid on
interest-bearing liabilities. |
(7) |
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. |
(8) |
See “Supplemental Non-GAAP Financial Measures/Ratios”
at Table 18 for additional information on this performance
ratio. |
TABLE 9: 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 Scenario is as follows:
Static Shock Scenario |
+200
Basis
Points |
|
+100
Basis
Points |
|
-100
Basis
Points |
Dec 31, 2019 |
18.6 |
% |
|
9.7 |
% |
|
(10.9 |
)% |
Sep 30, 2019 |
20.7 |
|
|
10.5 |
|
|
(11.9 |
) |
Jun 30, 2019 |
17.3 |
|
|
8.9 |
|
|
(10.2 |
) |
Mar 31, 2019 |
14.9 |
|
|
7.8 |
|
|
(8.5 |
) |
Dec 31, 2018 |
15.6 |
|
|
7.9 |
|
|
(8.6 |
) |
Ramp Scenario |
+200
Basis
Points |
|
+100
Basis
Points |
|
-100
Basis
Points |
Dec 31, 2019 |
9.3 |
% |
|
4.8 |
% |
|
(5.0 |
)% |
Sep 30, 2019 |
10.1 |
|
|
5.2 |
|
|
(5.6 |
) |
Jun 30, 2019 |
8.3 |
|
|
4.3 |
|
|
(4.6 |
) |
Mar 31, 2019 |
6.7 |
|
|
3.5 |
|
|
(3.3 |
) |
Dec 31, 2018 |
7.4 |
|
|
3.8 |
|
|
(3.6 |
) |
|
|
|
|
|
|
|
|
|
TABLE 10: MATURITIES AND SENSITIVITIES
TO CHANGES IN INTEREST RATES
|
Loans repricing or maturity period |
|
|
As of December 31, 2019 |
One year or less |
|
From one to five years |
|
Over five years |
|
|
(In
thousands) |
|
|
|
Total |
|
|
|
|
|
|
|
|
Commercial |
|
|
|
|
|
|
|
Fixed rate |
$ |
180,519 |
|
|
$ |
1,454,680 |
|
|
$ |
796,323 |
|
|
$ |
2,431,522 |
|
Variable rate |
5,832,290 |
|
|
21,972 |
|
|
136 |
|
|
5,854,398 |
|
Total commercial |
$ |
6,012,809 |
|
|
$ |
1,476,652 |
|
|
$ |
796,459 |
|
|
$ |
8,285,920 |
|
Commercial real estate |
|
|
|
|
|
|
|
Fixed rate |
480,094 |
|
|
2,112,534 |
|
|
370,604 |
|
|
2,963,232 |
|
Variable rate |
5,019,250 |
|
|
37,787 |
|
|
7 |
|
|
5,057,044 |
|
Total commercial real estate |
$ |
5,499,344 |
|
|
$ |
2,150,321 |
|
|
$ |
370,611 |
|
|
$ |
8,020,276 |
|
Home equity |
|
|
|
|
|
|
|
Fixed rate |
25,854 |
|
|
3,741 |
|
|
9,348 |
|
|
38,943 |
|
Variable rate |
473,879 |
|
|
— |
|
|
244 |
|
|
474,123 |
|
Total home equity |
$ |
499,733 |
|
|
$ |
3,741 |
|
|
$ |
9,592 |
|
|
$ |
513,066 |
|
Residential real estate |
|
|
|
|
|
|
|
Fixed rate |
40,630 |
|
|
22,015 |
|
|
390,926 |
|
|
453,571 |
|
Variable rate |
85,597 |
|
|
347,368 |
|
|
467,685 |
|
|
900,650 |
|
Total residential real estate |
$ |
126,227 |
|
|
$ |
369,383 |
|
|
$ |
858,611 |
|
|
$ |
1,354,221 |
|
Premium finance receivables - commercial |
|
|
|
|
|
|
|
Fixed rate |
3,362,547 |
|
|
79,480 |
|
|
— |
|
|
3,442,027 |
|
Variable rate |
— |
|
|
— |
|
|
— |
|
|
— |
|
Total premium finance receivables - commercial |
$ |
3,362,547 |
|
|
$ |
79,480 |
|
|
$ |
— |
|
|
$ |
3,442,027 |
|
Premium finance receivables - life insurance |
|
|
|
|
|
|
|
Fixed rate |
14,171 |
|
|
132,629 |
|
|
25,247 |
|
|
172,047 |
|
Variable rate |
4,902,555 |
|
|
— |
|
|
— |
|
|
4,902,555 |
|
Total premium finance receivables - life insurance |
$ |
4,916,726 |
|
|
$ |
132,629 |
|
|
$ |
25,247 |
|
|
$ |
5,074,602 |
|
Consumer and other |
|
|
|
|
|
|
|
Fixed rate |
77,621 |
|
|
10,470 |
|
|
1,927 |
|
|
90,018 |
|
Variable rate |
20,160 |
|
|
— |
|
|
— |
|
|
20,160 |
|
Total consumer and other |
$ |
97,781 |
|
|
$ |
10,470 |
|
|
$ |
1,927 |
|
|
$ |
110,178 |
|
|
|
|
|
|
|
|
|
Total per category |
|
|
|
|
|
|
|
Fixed rate |
4,181,436 |
|
|
3,815,549 |
|
|
1,594,375 |
|
|
9,591,360 |
|
Variable rate |
16,333,731 |
|
|
407,127 |
|
|
468,072 |
|
|
17,208,930 |
|
Total loans, net of unearned income |
$ |
20,515,167 |
|
|
$ |
4,222,676 |
|
|
$ |
2,062,447 |
|
|
$ |
26,800,290 |
|
|
|
|
|
|
|
|
|
Variable Rate Loan Pricing by Index: |
|
|
|
|
|
|
|
Prime |
|
|
|
|
|
|
$ |
2,162,148 |
|
One-month LIBOR |
|
|
|
|
|
|
8,552,261 |
|
Three-month LIBOR |
|
|
|
|
|
|
334,925 |
|
Twelve-month LIBOR |
|
|
|
|
|
|
5,521,391 |
|
Other |
|
|
|
|
|
|
638,205 |
|
Total variable rate |
|
|
|
|
|
|
$ |
17,208,930 |
|
Graph available at the following link:
http://ml.globenewswire.com/Resource/Download/50728f70-26b9-4437-95a1-dd7c03f0b3c3
Source: Bloomberg
As noted in the table on the previous page, the
majority of the Company’s portfolio is tied to LIBOR indices which,
as shown in the table above, do not mirror the same changes as the
Prime rate when the Federal Reserve raises or lowers interest
rates. Specifically, the Company has $8.6 billion of variable
rate loans tied to one-month LIBOR and $5.5 billion of variable
rate loans tied to twelve-month LIBOR. The above chart shows:
|
Basis Points (bps) Change in |
|
Prime |
|
1-month
LIBOR |
|
12-month
LIBOR |
|
Fourth Quarter 2019 |
-25 |
bps |
-26 |
bps |
-3 |
bps |
Third
Quarter 2019 |
-50 |
|
-38 |
|
-15 |
|
Second
Quarter 2019 |
0 |
|
-9 |
|
-53 |
|
First
Quarter 2019 |
0 |
|
-1 |
|
-30 |
|
Fourth Quarter 2018 |
+25 |
|
+24 |
|
+9 |
|
|
|
|
|
|
|
|
TABLE 11: ALLOWANCE FOR CREDIT LOSSES
|
Three Months Ended |
Years Ended |
|
Dec 31, |
|
Sep 30, |
|
Jun 30, |
|
Mar 31, |
|
Dec 31, |
Dec 31, |
|
Dec 31, |
(Dollars in thousands) |
2019 |
|
2019 |
|
2019 |
|
2019 |
|
2018 |
2019 |
|
2018 |
Allowance for loan losses at beginning of
period |
$ |
161,763 |
|
|
$ |
160,421 |
|
|
$ |
158,212 |
|
|
$ |
152,770 |
|
|
$ |
149,756 |
|
$ |
152,770 |
|
|
$ |
137,905 |
|
Provision for credit losses |
7,826 |
|
|
10,834 |
|
|
24,580 |
|
|
10,624 |
|
|
10,401 |
|
53,864 |
|
|
34,832 |
|
Other adjustments |
30 |
|
|
(13 |
) |
|
(11 |
) |
|
(27 |
) |
|
(79 |
) |
(21 |
) |
|
(181 |
) |
Reclassification (to) from allowance for unfunded
lending-related commitments |
(122 |
) |
|
(30 |
) |
|
(70 |
) |
|
(16 |
) |
|
(150 |
) |
(238 |
) |
|
(126 |
) |
Charge-offs: |
|
|
|
|
|
|
|
|
|
|
|
|
Commercial |
11,222 |
|
|
6,775 |
|
|
17,380 |
|
|
503 |
|
|
6,416 |
|
35,880 |
|
|
14,532 |
|
Commercial real estate |
533 |
|
|
809 |
|
|
326 |
|
|
3,734 |
|
|
219 |
|
5,402 |
|
|
1,395 |
|
Home equity |
1,330 |
|
|
1,594 |
|
|
690 |
|
|
88 |
|
|
715 |
|
3,702 |
|
|
2,245 |
|
Residential real estate |
483 |
|
|
25 |
|
|
287 |
|
|
3 |
|
|
267 |
|
798 |
|
|
1,355 |
|
Premium finance receivables - commercial |
3,817 |
|
|
1,866 |
|
|
5,009 |
|
|
2,210 |
|
|
1,741 |
|
12,902 |
|
|
12,228 |
|
Premium finance receivables - life insurance |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
— |
|
|
— |
|
Consumer and other |
167 |
|
|
117 |
|
|
136 |
|
|
102 |
|
|
148 |
|
522 |
|
|
880 |
|
Total charge-offs |
17,552 |
|
|
11,186 |
|
|
23,828 |
|
|
6,640 |
|
|
9,506 |
|
59,206 |
|
|
32,635 |
|
Recoveries: |
|
|
|
|
|
|
|
|
|
|
|
|
Commercial |
1,871 |
|
|
367 |
|
|
289 |
|
|
318 |
|
|
225 |
|
2,845 |
|
|
1,457 |
|
Commercial real estate |
1,404 |
|
|
385 |
|
|
247 |
|
|
480 |
|
|
1,364 |
|
2,516 |
|
|
5,631 |
|
Home equity |
166 |
|
|
183 |
|
|
68 |
|
|
62 |
|
|
105 |
|
479 |
|
|
541 |
|
Residential real estate |
50 |
|
|
203 |
|
|
140 |
|
|
29 |
|
|
47 |
|
422 |
|
|
2,075 |
|
Premium finance receivables - commercial |
1,350 |
|
|
563 |
|
|
734 |
|
|
556 |
|
|
567 |
|
3,203 |
|
|
3,069 |
|
Premium finance receivables - life insurance |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
— |
|
|
— |
|
Consumer and other |
42 |
|
|
36 |
|
|
60 |
|
|
56 |
|
|
40 |
|
194 |
|
|
202 |
|
Total recoveries |
4,883 |
|
|
1,737 |
|
|
1,538 |
|
|
1,501 |
|
|
2,348 |
|
9,659 |
|
|
12,975 |
|
Net charge-offs |
(12,669 |
) |
|
(9,449 |
) |
|
(22,290 |
) |
|
(5,139 |
) |
|
(7,158 |
) |
(49,547 |
) |
|
(19,660 |
) |
Allowance for loan losses at period end |
$ |
156,828 |
|
|
$ |
161,763 |
|
|
$ |
160,421 |
|
|
$ |
158,212 |
|
|
$ |
152,770 |
|
$ |
156,828 |
|
|
$ |
152,770 |
|
Allowance for unfunded lending-related commitments at
period end |
1,633 |
|
|
1,510 |
|
|
1,480 |
|
|
1,410 |
|
|
1,394 |
|
1,633 |
|
|
1,394 |
|
Allowance for credit losses at period end |
$ |
158,461 |
|
|
$ |
163,273 |
|
|
$ |
161,901 |
|
|
$ |
159,622 |
|
|
$ |
154,164 |
|
$ |
158,461 |
|
|
$ |
154,164 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Annualized net charge-offs (recoveries) by category as a
percentage of its own respective
category’s average: |
|
|
|
Commercial |
0.46 |
% |
|
0.31 |
% |
|
0.85 |
% |
|
0.01 |
% |
|
0.33 |
% |
0.41 |
% |
|
0.18 |
% |
Commercial real estate |
(0.04 |
) |
|
0.02 |
|
|
0.00 |
|
|
0.19 |
|
|
(0.07 |
) |
0.04 |
|
|
(0.06 |
) |
Home equity |
0.89 |
|
|
1.08 |
|
|
0.47 |
|
|
0.02 |
|
|
0.43 |
|
0.61 |
|
|
0.28 |
|
Residential real estate |
0.14 |
|
|
(0.07 |
) |
|
0.06 |
|
|
(0.01 |
) |
|
0.10 |
|
0.04 |
|
|
(0.08 |
) |
Premium finance receivables - commercial |
0.28 |
|
|
0.15 |
|
|
0.55 |
|
|
0.23 |
|
|
0.16 |
|
0.30 |
|
|
0.33 |
|
Premium finance receivables - life insurance |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
— |
|
|
— |
|
Consumer and other |
0.41 |
|
|
0.27 |
|
|
0.30 |
|
|
0.16 |
|
|
0.30 |
|
0.29 |
|
|
0.50 |
|
Total loans, net of unearned income |
0.19 |
% |
|
0.15 |
% |
|
0.36 |
% |
|
0.09 |
% |
|
0.12 |
% |
0.20 |
% |
|
0.09 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net charge-offs as a percentage of the provision for
credit losses |
161.88 |
% |
|
87.22 |
% |
|
90.68 |
% |
|
48.37 |
% |
|
68.82 |
% |
91.99 |
% |
|
56.44 |
% |
Loans at period-end |
$ |
26,800,290 |
|
|
$ |
25,710,171 |
|
|
$ |
25,304,659 |
|
|
$ |
24,214,629 |
|
|
$ |
23,820,691 |
|
|
|
|
Allowance for loan losses as a percentage of loans at
period end |
0.59 |
% |
|
0.63 |
% |
|
0.63 |
% |
|
0.65 |
% |
|
0.64 |
% |
|
|
|
Allowance for credit losses as a percentage of loans at
period end |
0.59 |
|
|
0.64 |
|
|
0.64 |
|
|
0.66 |
|
|
0.65 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Provision for credit losses by component for
the periods presented:
|
Three Months Ended |
Years Ended |
|
Dec 31, |
|
Sep 30, |
|
Jun 30, |
|
Mar 31, |
|
Dec 31, |
Dec 31, |
|
Dec 31, |
(In
thousands) |
2019 |
|
2019 |
|
2019 |
|
2019 |
|
2018 |
2019 |
|
2018 |
Provision for loan losses |
$ |
7,704 |
|
|
$ |
10,804 |
|
|
$ |
24,510 |
|
|
$ |
10,608 |
|
|
$ |
10,251 |
|
$ |
53,626 |
|
|
$ |
34,706 |
|
Provision for unfunded lending-related commitments |
122 |
|
|
30 |
|
|
70 |
|
|
16 |
|
|
150 |
|
238 |
|
|
126 |
|
Provision for credit losses |
$ |
7,826 |
|
|
$ |
10,834 |
|
|
$ |
24,580 |
|
|
$ |
10,624 |
|
|
$ |
10,401 |
|
$ |
53,864 |
|
|
$ |
34,832 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TABLE 12: ALLOWANCE BY LOAN PORTFOLIO
The table below summarizes the calculation of
allowance for loan losses for the Company’s core loan portfolio and
consumer, niche and purchased loan portfolio, as of
December 31, 2019 and September 30, 2019.
|
As of December 31, 2019 |
As of September 30, 2019 |
(Dollars in thousands) |
Recorded
Investment |
|
Calculated
Allowance |
|
% of its
category’s balance |
Recorded
Investment |
|
Calculated
Allowance |
|
% of its
category’s balance |
Commercial: (1) |
|
|
|
|
|
|
|
|
|
|
Commercial and industrial |
$ |
4,323,281 |
|
|
$ |
40,736 |
|
|
0.94 |
% |
$ |
4,368,580 |
|
|
$ |
47,983 |
|
|
1.10 |
% |
Asset-based lending |
988,059 |
|
|
7,871 |
|
|
0.80 |
|
1,043,384 |
|
|
8,445 |
|
|
0.81 |
|
Tax exempt |
505,972 |
|
|
2,926 |
|
|
0.58 |
|
503,495 |
|
|
2,957 |
|
|
0.59 |
|
Leases |
873,919 |
|
|
2,647 |
|
|
0.30 |
|
749,135 |
|
|
2,069 |
|
|
0.28 |
|
Commercial real estate: (1) |
|
|
|
|
|
|
|
|
|
|
Residential construction |
35,693 |
|
|
582 |
|
|
1.63 |
|
35,662 |
|
|
625 |
|
|
1.75 |
|
Commercial construction |
869,547 |
|
|
9,424 |
|
|
1.08 |
|
810,919 |
|
|
8,757 |
|
|
1.08 |
|
Land |
170,305 |
|
|
4,779 |
|
|
2.81 |
|
168,092 |
|
|
4,801 |
|
|
2.86 |
|
Office |
1,007,558 |
|
|
9,880 |
|
|
0.98 |
|
964,557 |
|
|
10,066 |
|
|
1.04 |
|
Industrial |
978,671 |
|
|
6,715 |
|
|
0.69 |
|
972,859 |
|
|
7,015 |
|
|
0.72 |
|
Retail |
1,032,349 |
|
|
6,736 |
|
|
0.65 |
|
960,762 |
|
|
6,718 |
|
|
0.70 |
|
Multi-family |
1,255,925 |
|
|
12,527 |
|
|
1.00 |
|
1,239,217 |
|
|
12,504 |
|
|
1.01 |
|
Mixed use and other |
1,924,539 |
|
|
16,077 |
|
|
0.84 |
|
1,918,510 |
|
|
14,362 |
|
|
0.75 |
|
Home
equity (1) |
469,498 |
|
|
3,860 |
|
|
0.82 |
|
479,627 |
|
|
3,702 |
|
|
0.77 |
|
Residential real estate (1) |
1,246,829 |
|
|
9,736 |
|
|
0.78 |
|
1,191,153 |
|
|
9,314 |
|
|
0.78 |
|
Total core loan portfolio |
$ |
15,682,145 |
|
|
$ |
134,496 |
|
|
0.86 |
% |
$ |
15,405,952 |
|
|
$ |
139,318 |
|
|
0.90 |
% |
Commercial: |
|
|
|
|
|
|
|
|
|
|
Franchise |
$ |
906,403 |
|
|
$ |
7,922 |
|
|
0.87 |
% |
$ |
881,287 |
|
|
$ |
8,251 |
|
|
0.94 |
% |
Mortgage warehouse lines of credit |
292,781 |
|
|
2,166 |
|
|
0.74 |
|
314,697 |
|
|
2,481 |
|
|
0.79 |
|
Community Advantage - homeowner associations |
220,227 |
|
|
552 |
|
|
0.25 |
|
202,724 |
|
|
507 |
|
|
0.25 |
|
Aircraft |
10,942 |
|
|
9 |
|
|
0.08 |
|
11,112 |
|
|
9 |
|
|
0.08 |
|
Purchased commercial loans (2) |
164,336 |
|
|
91 |
|
|
0.06 |
|
121,188 |
|
|
425 |
|
|
0.35 |
|
Purchased
commercial real estate (2) |
745,689 |
|
|
158 |
|
|
0.02 |
|
378,089 |
|
|
90 |
|
|
0.02 |
|
Purchased
home equity (2) |
43,568 |
|
|
18 |
|
|
0.04 |
|
32,676 |
|
|
18 |
|
|
0.06 |
|
Purchased
residential real estate (2) |
107,392 |
|
|
64 |
|
|
0.06 |
|
27,513 |
|
|
97 |
|
|
0.35 |
|
Premium finance receivables |
|
|
|
|
|
|
|
|
|
|
U.S. commercial insurance loans |
2,985,641 |
|
|
7,336 |
|
|
0.25 |
|
3,016,644 |
|
|
7,207 |
|
|
0.24 |
|
Canada commercial insurance loans (2) |
456,386 |
|
|
796 |
|
|
0.17 |
|
433,306 |
|
|
648 |
|
|
0.15 |
|
Life insurance loans (1) |
4,935,321 |
|
|
1,515 |
|
|
0.03 |
|
4,654,588 |
|
|
1,511 |
|
|
0.03 |
|
Purchased life insurance loans (2) |
139,281 |
|
|
— |
|
|
— |
|
140,908 |
|
|
— |
|
|
— |
|
Consumer
and other (1) |
107,053 |
|
|
1,704 |
|
|
1.59 |
|
86,437 |
|
|
1,199 |
|
|
1.40 |
|
Purchased
consumer and other (2) |
3,125 |
|
|
1 |
|
|
0.03 |
|
3,050 |
|
|
2 |
|
|
0.07 |
|
Total consumer, niche and purchased loan
portfolio |
$ |
11,118,145 |
|
|
$ |
22,332 |
|
|
0.20 |
% |
$ |
10,304,219 |
|
|
$ |
22,445 |
|
|
0.22 |
% |
Total loans, net of unearned income |
$ |
26,800,290 |
|
|
$ |
156,828 |
|
|
0.59 |
% |
$ |
25,710,171 |
|
|
$ |
161,763 |
|
|
0.63 |
% |
(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. |
TABLE 13: LOAN PORTFOLIO
AGING
|
|
|
90+ days |
|
60-89 |
|
30-59 |
|
|
|
|
As of December 31, 2019 |
|
|
and still |
|
days past |
|
days past |
|
|
|
|
(Dollars in thousands) |
Nonaccrual |
|
accruing |
|
due |
|
due |
|
Current |
|
Total Loans |
Loan Balances: |
|
|
|
|
|
|
|
|
|
|
|
Commercial (1) |
$ |
37,224 |
|
|
$ |
1,855 |
|
|
$ |
3,275 |
|
|
$ |
77,324 |
|
|
$ |
8,166,242 |
|
|
$ |
8,285,920 |
|
Commercial real estate (1) |
26,113 |
|
|
14,946 |
|
|
31,546 |
|
|
97,567 |
|
|
7,850,104 |
|
|
8,020,276 |
|
Home equity |
7,363 |
|
|
— |
|
|
454 |
|
|
3,533 |
|
|
501,716 |
|
|
513,066 |
|
Residential real estate (1) |
13,797 |
|
|
5,771 |
|
|
3,089 |
|
|
18,041 |
|
|
1,313,523 |
|
|
1,354,221 |
|
Premium finance receivables - commercial |
20,590 |
|
|
11,517 |
|
|
12,119 |
|
|
18,783 |
|
|
3,379,018 |
|
|
3,442,027 |
|
Premium finance receivables - life insurance (1) |
590 |
|
|
— |
|
|
— |
|
|
32,559 |
|
|
5,041,453 |
|
|
5,074,602 |
|
Consumer and other (1) |
231 |
|
|
287 |
|
|
40 |
|
|
344 |
|
|
109,276 |
|
|
110,178 |
|
Total loans, net of unearned income |
$ |
105,908 |
|
|
$ |
34,376 |
|
|
$ |
50,523 |
|
|
$ |
248,151 |
|
|
$ |
26,361,332 |
|
|
$ |
26,800,290 |
|
Aging as a % of Loan Balance: |
|
|
|
|
|
|
|
|
|
|
|
Commercial (1) |
0.5 |
% |
|
0.0 |
% |
|
0.0 |
% |
|
0.9 |
% |
|
98.6 |
% |
|
100.0 |
% |
Commercial real estate (1) |
0.3 |
|
|
0.2 |
|
|
0.4 |
|
|
1.2 |
|
|
97.9 |
|
|
100.0 |
|
Home equity |
1.4 |
|
|
— |
|
|
0.1 |
|
|
0.7 |
|
|
97.8 |
|
|
100.0 |
|
Residential real estate (1) |
1.0 |
|
|
0.4 |
|
|
0.2 |
|
|
1.3 |
|
|
97.1 |
|
|
100.0 |
|
Premium finance receivables - commercial |
0.6 |
|
|
0.3 |
|
|
0.4 |
|
|
0.5 |
|
|
98.2 |
|
|
100.0 |
|
Premium finance receivables - life insurance (1) |
0.0 |
|
|
— |
|
|
— |
|
|
0.6 |
|
|
99.4 |
|
|
100.0 |
|
Consumer and other (1) |
0.2 |
|
|
0.3 |
|
|
0.0 |
|
|
0.3 |
|
|
99.2 |
|
|
100.0 |
|
Total loans, net of unearned income |
0.4 |
% |
|
0.1 |
% |
|
0.2 |
% |
|
0.9 |
% |
|
98.4 |
% |
|
100.0 |
% |
(1) |
Including PCI loans. 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 September 30, 2019 |
|
|
and still |
|
days past |
|
days past |
|
|
|
|
(Dollars in thousands) |
Nonaccrual |
|
accruing |
|
due |
|
due |
|
Current |
|
Total Loans |
Loan Balances: |
|
|
|
|
|
|
|
|
|
|
|
Commercial (1) |
$ |
43,931 |
|
|
$ |
382 |
|
|
$ |
12,860 |
|
|
$ |
51,487 |
|
|
$ |
8,086,942 |
|
|
$ |
8,195,602 |
|
Commercial real estate (1) |
21,557 |
|
|
4,992 |
|
|
9,629 |
|
|
33,098 |
|
|
7,379,391 |
|
|
7,448,667 |
|
Home equity |
7,920 |
|
|
— |
|
|
95 |
|
|
3,100 |
|
|
501,188 |
|
|
512,303 |
|
Residential real estate (1) |
13,447 |
|
|
3,244 |
|
|
1,868 |
|
|
1,433 |
|
|
1,198,674 |
|
|
1,218,666 |
|
Premium finance receivables - commercial |
15,950 |
|
|
10,612 |
|
|
8,853 |
|
|
16,972 |
|
|
3,397,563 |
|
|
3,449,950 |
|
Premium finance receivables - life insurance (1) |
590 |
|
|
— |
|
|
17,753 |
|
|
27,795 |
|
|
4,749,358 |
|
|
4,795,496 |
|
Consumer and other (1) |
224 |
|
|
117 |
|
|
55 |
|
|
272 |
|
|
88,819 |
|
|
89,487 |
|
Total loans, net of unearned income |
$ |
103,619 |
|
|
$ |
19,347 |
|
|
$ |
51,113 |
|
|
$ |
134,157 |
|
|
$ |
25,401,935 |
|
|
$ |
25,710,171 |
|
Aging as a % of Loan Balance: |
|
|
|
|
|
|
|
|
|
|
|
Commercial (1) |
0.5 |
% |
|
0.0 |
% |
|
0.2 |
% |
|
0.6 |
% |
|
98.7 |
% |
|
100.0 |
% |
Commercial real estate (1) |
0.3 |
|
|
0.1 |
|
|
0.1 |
|
|
0.4 |
|
|
99.1 |
|
|
100.0 |
|
Home equity |
1.6 |
|
|
— |
|
|
0.0 |
|
|
0.6 |
|
|
97.8 |
|
|
100.0 |
|
Residential real estate (1) |
1.1 |
|
|
0.3 |
|
|
0.1 |
|
|
0.1 |
|
|
98.4 |
|
|
100.0 |
|
Premium finance receivables - commercial |
0.5 |
|
|
0.3 |
|
|
0.2 |
|
|
0.5 |
|
|
98.5 |
|
|
100.0 |
|
Premium finance receivables - life insurance (1) |
0.0 |
|
|
— |
|
|
0.4 |
|
|
0.6 |
|
|
99.0 |
|
|
100.0 |
|
Consumer and other (1) |
0.2 |
|
|
0.1 |
|
|
0.1 |
|
|
0.3 |
|
|
99.3 |
|
|
100.0 |
|
Total loans, net of unearned income |
0.4 |
% |
|
0.1 |
% |
|
0.2 |
% |
|
0.5 |
% |
|
98.8 |
% |
|
100.0 |
% |
(1) |
Including PCI loans. 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. |
TABLE 14: NON-PERFORMING ASSETS, EXCLUDING PCI LOANS,
AND TROUBLED DEBT RESTRUCTURINGS ("TDRs")
|
Dec 31, |
|
Sep 30, |
|
Jun 30, |
|
Mar 31, |
|
Dec 31, |
(Dollars in thousands) |
2019 |
|
2019 |
|
2019 |
|
2019 |
|
2018 |
Loans past due greater than 90 days and still accruing
(1): |
|
|
|
|
|
|
|
|
|
Commercial |
$ |
— |
|
|
$ |
— |
|
|
$ |
488 |
|
|
$ |
— |
|
|
$ |
— |
|
Commercial real estate |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Home
equity |
— |
|
|
— |
|
|
— |
|
|
— |
|
|
— |
|
Residential real estate |
— |
|
|
— |
|
|
— |
|
|
30 |
|
|
— |
|
Premium
finance receivables - commercial |
11,517 |
|
|
10,612 |
|
|
6,940 |
|
|
6,558 |
|
|
7,799 |
|
Premium
finance receivables - life insurance |
— |
|
|
— |
|
|
— |
|
|
168 |
|
|
— |
|
Consumer
and other |
163 |
|
|
53 |
|
|
172 |
|
|
218 |
|
|
109 |
|
Total loans past due greater than 90 days and still accruing |
11,680 |
|
|
10,665 |
|
|
7,600 |
|
|
6,974 |
|
|
7,908 |
|
Non-accrual loans (2): |
|
|
|
|
|
|
|
|
|
Commercial |
37,224 |
|
|
43,931 |
|
|
47,604 |
|
|
55,792 |
|
|
50,984 |
|
Commercial real estate |
26,113 |
|
|
21,557 |
|
|
20,875 |
|
|
15,933 |
|
|
19,129 |
|
Home
equity |
7,363 |
|
|
7,920 |
|
|
8,489 |
|
|
7,885 |
|
|
7,147 |
|
Residential real estate |
13,797 |
|
|
13,447 |
|
|
14,236 |
|
|
15,879 |
|
|
16,383 |
|
Premium
finance receivables - commercial |
20,590 |
|
|
15,950 |
|
|
13,833 |
|
|
14,797 |
|
|
11,335 |
|
Premium
finance receivables - life insurance |
590 |
|
|
590 |
|
|
590 |
|
|
— |
|
|
— |
|
Consumer
and other |
231 |
|
|
224 |
|
|
220 |
|
|
326 |
|
|
348 |
|
Total non-accrual loans |
105,908 |
|
|
103,619 |
|
|
105,847 |
|
|
110,612 |
|
|
105,326 |
|
Total non-performing loans: |
|
|
|
|
|
|
|
|
|
Commercial |
37,224 |
|
|
43,931 |
|
|
48,092 |
|
|
55,792 |
|
|
50,984 |
|
Commercial real estate |
26,113 |
|
|
21,557 |
|
|
20,875 |
|
|
15,933 |
|
|
19,129 |
|
Home
equity |
7,363 |
|
|
7,920 |
|
|
8,489 |
|
|
7,885 |
|
|
7,147 |
|
Residential real estate |
13,797 |
|
|
13,447 |
|
|
14,236 |
|
|
15,909 |
|
|
16,383 |
|
Premium
finance receivables - commercial |
32,107 |
|
|
26,562 |
|
|
20,773 |
|
|
21,355 |
|
|
19,134 |
|
Premium
finance receivables - life insurance |
590 |
|
|
590 |
|
|
590 |
|
|
168 |
|
|
— |
|
Consumer
and other |
394 |
|
|
277 |
|
|
392 |
|
|
544 |
|
|
457 |
|
Total non-performing loans |
$ |
117,588 |
|
|
$ |
114,284 |
|
|
$ |
113,447 |
|
|
$ |
117,586 |
|
|
$ |
113,234 |
|
Other
real estate owned |
5,208 |
|
|
8,584 |
|
|
9,920 |
|
|
9,154 |
|
|
11,968 |
|
Other
real estate owned - from acquisitions |
9,963 |
|
|
8,898 |
|
|
9,917 |
|
|
12,366 |
|
|
12,852 |
|
Other
repossessed assets |
4 |
|
|
257 |
|
|
263 |
|
|
270 |
|
|
280 |
|
Total non-performing assets |
$ |
132,763 |
|
|
$ |
132,023 |
|
|
$ |
133,547 |
|
|
$ |
139,376 |
|
|
$ |
138,334 |
|
TDRs
performing under the contractual terms of the loan agreement |
$ |
36,725 |
|
|
$ |
45,178 |
|
|
$ |
45,862 |
|
|
$ |
48,305 |
|
|
$ |
33,281 |
|
Total non-performing loans by category as a percent of its
own respective category’s period-end balance: |
|
|
|
|
|
|
|
|
|
Commercial |
0.45 |
% |
|
0.54 |
% |
|
0.58 |
% |
|
0.70 |
% |
|
0.65 |
% |
Commercial real estate |
0.33 |
|
|
0.29 |
|
|
0.29 |
|
|
0.23 |
|
|
0.28 |
|
Home
equity |
1.44 |
|
|
1.55 |
|
|
1.61 |
|
|
1.49 |
|
|
1.29 |
|
Residential real estate |
1.02 |
|
|
1.10 |
|
|
1.27 |
|
|
1.51 |
|
|
1.63 |
|
Premium
finance receivables - commercial |
0.93 |
|
|
0.77 |
|
|
0.62 |
|
|
0.71 |
|
|
0.67 |
|
Premium
finance receivables - life insurance |
0.01 |
|
|
0.01 |
|
|
0.01 |
|
|
0.00 |
|
|
— |
|
Consumer
and other |
0.36 |
|
|
0.31 |
|
|
0.36 |
|
|
0.45 |
|
|
0.38 |
|
Total loans, net of unearned income |
0.44 |
% |
|
0.44 |
% |
|
0.45 |
% |
|
0.49 |
% |
|
0.48 |
% |
Total non-performing assets as a percentage of total
assets |
0.36 |
% |
|
0.38 |
% |
|
0.40 |
% |
|
0.43 |
% |
|
0.44 |
% |
Allowance for loan losses as a percentage of total
non-performing loans |
133.37 |
% |
|
141.54 |
% |
|
141.41 |
% |
|
134.55 |
% |
|
134.92 |
% |
(1) |
As of
December 31, 2019, September 30, 2019, June 30, 2019,
March 31, 2019, and December 31, 2018, no TDRs were past due
greater than 90 days and still accruing interest. |
(2) |
Non-accrual loans included TDRs totaling $27.1
million, $21.1 million, $30.1 million, $40.1 million and $32.8
million as of December 31, 2019, September 30, 2019, June
30, 2019, March 31, 2019 and December 31, 2018,
respectively. |
Non-performing Loans Rollforward, excluding PCI loans:
|
Three Months Ended |
Years Ended |
|
Dec 31, |
|
Sep 30, |
|
Jun 30, |
|
Mar 31, |
|
Dec 31, |
Dec 31, |
|
Dec 31, |
(In
thousands) |
2019 |
|
2019 |
|
2019 |
|
2019 |
|
2018 |
2019 |
|
2018 |
Balance at beginning of period |
$ |
114,284 |
|
|
$ |
113,447 |
|
|
$ |
117,586 |
|
|
$ |
113,234 |
|
|
$ |
127,227 |
|
$ |
113,234 |
|
|
$ |
90,162 |
|
Additions, net |
30,977 |
|
|
20,781 |
|
|
20,567 |
|
|
24,030 |
|
|
18,553 |
|
96,355 |
|
|
92,428 |
|
Return to performing status |
(243 |
) |
|
(407 |
) |
|
(47 |
) |
|
(14,077 |
) |
|
(6,155 |
) |
(14,774 |
) |
|
(14,449 |
) |
Payments received |
(19,380 |
) |
|
(16,326 |
) |
|
(5,438 |
) |
|
(4,024 |
) |
|
(16,437 |
) |
(45,168 |
) |
|
(29,807 |
) |
Transfer to OREO and other repossessed assets |
— |
|
|
(1,493 |
) |
|
(1,486 |
) |
|
(82 |
) |
|
(970 |
) |
(3,061 |
) |
|
(7,138 |
) |
Charge-offs |
(11,798 |
) |
|
(6,984 |
) |
|
(16,817 |
) |
|
(3,992 |
) |
|
(7,161 |
) |
(39,591 |
) |
|
(15,792 |
) |
Net change for niche loans (1) |
3,748 |
|
|
5,266 |
|
|
(918 |
) |
|
2,497 |
|
|
(1,823 |
) |
10,593 |
|
|
(2,170 |
) |
Balance at end of period |
$ |
117,588 |
|
|
$ |
114,284 |
|
|
$ |
113,447 |
|
|
$ |
117,586 |
|
|
$ |
113,234 |
|
$ |
117,588 |
|
|
$ |
113,234 |
|
(1) |
This
includes activity for premium finance receivables and indirect
consumer loans. |
TDRs
|
Dec 31, |
|
Sep 30, |
|
Jun 30, |
|
Mar 31, |
|
Dec 31, |
(In
thousands) |
2019 |
|
2019 |
|
2019 |
|
2019 |
|
2018 |
Accruing TDRs: |
|
|
|
|
|
|
|
|
|
Commercial |
$ |
4,905 |
|
|
$ |
14,099 |
|
|
$ |
15,923 |
|
|
$ |
19,650 |
|
|
$ |
8,545 |
|
Commercial real estate |
9,754 |
|
|
10,370 |
|
|
12,646 |
|
|
14,123 |
|
|
13,895 |
|
Residential real estate and other |
22,066 |
|
|
20,709 |
|
|
17,293 |
|
|
14,532 |
|
|
10,841 |
|
Total accrual |
$ |
36,725 |
|
|
$ |
45,178 |
|
|
$ |
45,862 |
|
|
$ |
48,305 |
|
|
$ |
33,281 |
|
Non-accrual TDRs: (1) |
|
|
|
|
|
|
|
|
|
Commercial |
$ |
13,834 |
|
|
$ |
7,451 |
|
|
$ |
21,850 |
|
|
$ |
34,390 |
|
|
$ |
27,774 |
|
Commercial real estate |
7,119 |
|
|
7,673 |
|
|
2,854 |
|
|
1,517 |
|
|
1,552 |
|
Residential real estate and other |
6,158 |
|
|
6,006 |
|
|
5,435 |
|
|
4,150 |
|
|
3,495 |
|
Total non-accrual |
$ |
27,111 |
|
|
$ |
21,130 |
|
|
$ |
30,139 |
|
|
$ |
40,057 |
|
|
$ |
32,821 |
|
Total TDRs: |
|
|
|
|
|
|
|
|
|
Commercial |
$ |
18,739 |
|
|
$ |
21,550 |
|
|
$ |
37,773 |
|
|
$ |
54,040 |
|
|
$ |
36,319 |
|
Commercial real estate |
16,873 |
|
|
18,043 |
|
|
15,500 |
|
|
15,640 |
|
|
15,447 |
|
Residential real estate and other |
28,224 |
|
|
26,715 |
|
|
22,728 |
|
|
18,682 |
|
|
14,336 |
|
Total TDRs |
$ |
63,836 |
|
|
$ |
66,308 |
|
|
$ |
76,001 |
|
|
$ |
88,362 |
|
|
$ |
66,102 |
|
(1) |
Included in total non-performing loans. |
Other Real Estate Owned
|
Three Months Ended |
|
Dec 31, |
|
Sep 30, |
|
Jun 30, |
|
Mar 31, |
|
Dec 31, |
(In
thousands) |
2019 |
|
2019 |
|
2019 |
|
2019 |
|
2018 |
Balance at beginning of period |
$ |
17,482 |
|
|
$ |
19,837 |
|
|
$ |
21,520 |
|
|
$ |
24,820 |
|
|
$ |
28,303 |
|
Disposals/resolved |
(4,860 |
) |
|
(4,501 |
) |
|
(2,397 |
) |
|
(2,758 |
) |
|
(3,848 |
) |
Transfers in at fair value, less costs to sell |
936 |
|
|
3,008 |
|
|
1,746 |
|
|
32 |
|
|
997 |
|
Additions from acquisition |
2,179 |
|
|
— |
|
|
— |
|
|
— |
|
|
160 |
|
Fair value adjustments |
(566 |
) |
|
(862 |
) |
|
(1,032 |
) |
|
(574 |
) |
|
(792 |
) |
Balance at end of period |
$ |
15,171 |
|
|
$ |
17,482 |
|
|
$ |
19,837 |
|
|
$ |
21,520 |
|
|
$ |
24,820 |
|
|
|
|
|
|
|
|
|
|
|
|
Period End |
|
Dec 31, |
|
Sep 30, |
|
Jun 30, |
|
Mar 31, |
|
Dec 31, |
Balance by Property Type: |
2019 |
|
2019 |
|
2019 |
|
2019 |
|
2018 |
Residential real estate |
$ |
1,016 |
|
|
$ |
1,250 |
|
|
$ |
1,312 |
|
|
$ |
3,037 |
|
|
$ |
3,446 |
|
Residential real estate development |
810 |
|
|
1,282 |
|
|
1,282 |
|
|
1,139 |
|
|
1,426 |
|
Commercial real estate |
13,345 |
|
|
14,950 |
|
|
17,243 |
|
|
17,344 |
|
|
19,948 |
|
Total |
$ |
15,171 |
|
|
$ |
17,482 |
|
|
$ |
19,837 |
|
|
$ |
21,520 |
|
|
$ |
24,820 |
|
TABLE 15: NON-INTEREST INCOME
|
Three Months Ended |
|
Q4 2019 compared to
Q3 2019 |
|
Q4 2019 compared to
Q4 2018 |
|
Dec 31, |
|
Sep 30, |
|
Jun 30, |
|
Mar 31, |
|
Dec 31, |
|
|
(Dollars in thousands) |
2019 |
|
2019 |
|
2019 |
|
2019 |
|
2018 |
|
$ Change |
|
% Change |
|
$ Change |
|
% Change |
Brokerage |
$ |
4,859 |
|
|
$ |
4,686 |
|
|
$ |
4,764 |
|
|
$ |
4,516 |
|
|
$ |
4,997 |
|
|
$ |
173 |
|
|
4 |
% |
|
$ |
(138 |
) |
|
(3 |
)% |
Trust and asset management |
20,140 |
|
|
19,313 |
|
|
19,375 |
|
|
19,461 |
|
|
17,729 |
|
|
827 |
|
|
4 |
|
|
2,411 |
|
|
14 |
|
Total wealth management |
24,999 |
|
|
23,999 |
|
|
24,139 |
|
|
23,977 |
|
|
22,726 |
|
|
1,000 |
|
|
4 |
|
|
2,273 |
|
|
10 |
|
Mortgage banking |
47,860 |
|
|
50,864 |
|
|
37,411 |
|
|
18,158 |
|
|
24,182 |
|
|
(3,004 |
) |
|
(6 |
) |
|
23,678 |
|
|
98 |
|
Service charges on deposit accounts |
10,973 |
|
|
9,972 |
|
|
9,277 |
|
|
8,848 |
|
|
9,065 |
|
|
1,001 |
|
|
10 |
|
|
1,908 |
|
|
21 |
|
Gains (losses) on investment securities, net |
587 |
|
|
710 |
|
|
864 |
|
|
1,364 |
|
|
(2,649 |
) |
|
(123 |
) |
|
(17 |
) |
|
3,236 |
|
|
N |
M |
Fees from covered call options |
1,243 |
|
|
— |
|
|
643 |
|
|
1,784 |
|
|
626 |
|
|
1,243 |
|
|
N |
M |
|
617 |
|
|
99 |
|
Trading gains (losses), net |
46 |
|
|
11 |
|
|
(44 |
) |
|
(171 |
) |
|
(155 |
) |
|
35 |
|
|
N |
M |
|
201 |
|
|
N |
M |
Operating lease income, net |
12,487 |
|
|
12,025 |
|
|
11,733 |
|
|
10,796 |
|
|
10,882 |
|
|
462 |
|
|
4 |
|
|
1,605 |
|
|
15 |
|
Other: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate swap fees |
2,206 |
|
|
4,811 |
|
|
3,224 |
|
|
2,831 |
|
|
2,602 |
|
|
(2,605 |
) |
|
(54 |
) |
|
(396 |
) |
|
(15 |
) |
BOLI |
1,377 |
|
|
830 |
|
|
1,149 |
|
|
1,591 |
|
|
(466 |
) |
|
547 |
|
|
66 |
|
|
1,843 |
|
|
N |
M |
Administrative services |
1,072 |
|
|
1,086 |
|
|
1,009 |
|
|
1,030 |
|
|
1,260 |
|
|
(14 |
) |
|
(1 |
) |
|
(188 |
) |
|
(15 |
) |
Foreign currency remeasurement gains (losses) |
261 |
|
|
(55 |
) |
|
113 |
|
|
464 |
|
|
(1,149 |
) |
|
316 |
|
|
N |
M |
|
1,410 |
|
|
N |
M |
Early pay-offs of capital leases |
24 |
|
|
6 |
|
|
— |
|
|
5 |
|
|
3 |
|
|
18 |
|
|
N |
M |
|
21 |
|
|
N |
M |
Miscellaneous |
9,085 |
|
|
10,878 |
|
|
8,640 |
|
|
10,980 |
|
|
8,381 |
|
|
(1,793 |
) |
|
(16 |
) |
|
704 |
|
|
8 |
|
Total Other |
14,025 |
|
|
17,556 |
|
|
14,135 |
|
|
16,901 |
|
|
10,631 |
|
|
(3,531 |
) |
|
(20 |
) |
|
3,394 |
|
|
32 |
|
Total Non-Interest Income |
$ |
112,220 |
|
|
$ |
115,137 |
|
|
$ |
98,158 |
|
|
$ |
81,657 |
|
|
$ |
75,308 |
|
|
$ |
(2,917 |
) |
|
(3 |
)% |
|
$ |
36,912 |
|
|
49 |
% |
NM - Not meaningful.
|
|
|
|
|
|
|
Years Ended |
|
|
|
|
|
Dec 31, |
|
Dec 31, |
|
$ |
|
% |
(Dollars in thousands) |
2019 |
|
2018 |
|
Change |
|
Change |
Brokerage |
$ |
18,825 |
|
|
$ |
22,391 |
|
|
$ |
(3,566 |
) |
|
(16 |
)% |
Trust and asset management |
78,289 |
|
|
68,572 |
|
|
9,717 |
|
|
14 |
|
Total wealth management |
97,114 |
|
|
90,963 |
|
|
6,151 |
|
|
7 |
|
Mortgage banking |
154,293 |
|
|
136,990 |
|
|
17,303 |
|
|
13 |
|
Service charges on deposit accounts |
39,070 |
|
|
36,404 |
|
|
2,666 |
|
|
7 |
|
Gains (losses) on investment securities, net |
3,525 |
|
|
(2,898 |
) |
|
6,423 |
|
|
N |
M |
Fees from covered call options |
3,670 |
|
|
3,519 |
|
|
151 |
|
|
4 |
|
Trading (losses) gains, net |
(158 |
) |
|
11 |
|
|
(169 |
) |
|
N |
M |
Operating lease income, net |
47,041 |
|
|
38,451 |
|
|
8,590 |
|
|
22 |
|
Other: |
|
|
|
|
|
|
|
Interest rate swap fees |
13,072 |
|
|
11,027 |
|
|
2,045 |
|
|
19 |
|
BOLI |
4,947 |
|
|
4,982 |
|
|
(35 |
) |
|
(1 |
) |
Administrative services |
4,197 |
|
|
4,625 |
|
|
(428 |
) |
|
(9 |
) |
Foreign currency remeasurement gain (loss) |
783 |
|
|
(1,673 |
) |
|
2,456 |
|
|
N |
M |
Early pay-offs of leases |
35 |
|
|
601 |
|
|
(566 |
) |
|
(94 |
) |
Miscellaneous |
39,583 |
|
|
33,148 |
|
|
6,435 |
|
|
19 |
|
Total Other |
62,617 |
|
|
52,710 |
|
|
9,907 |
|
|
19 |
|
Total Non-Interest Income |
$ |
407,172 |
|
|
$ |
356,150 |
|
|
$ |
51,022 |
|
|
14 |
% |
NM - Not meaningful.
TABLE 16: MORTGAGE BANKING
|
Three Months Ended |
Years Ended |
(Dollars in thousands) |
Dec 31,
2019 |
|
Sep 30,
2019 |
|
Jun 30,
2019 |
|
Mar 31,
2019 |
|
Dec 31,
2018 |
Dec 31,
2019 |
|
Dec 31,
2018 |
Originations: |
|
|
|
|
|
|
|
|
|
|
|
|
Retail originations |
$ |
782,122 |
|
|
$ |
913,631 |
|
|
$ |
669,510 |
|
|
$ |
365,602 |
|
|
$ |
463,196 |
|
$ |
2,730,865 |
|
|
$ |
2,412,232 |
|
Correspondent originations |
4,024 |
|
|
50,639 |
|
|
182,966 |
|
|
148,100 |
|
|
289,101 |
|
385,729 |
|
|
848,997 |
|
Veterans
First originations |
459,236 |
|
|
456,005 |
|
|
301,324 |
|
|
164,762 |
|
|
175,483 |
|
1,381,327 |
|
|
694,209 |
|
Total originations for sale (A) |
$ |
1,245,382 |
|
|
$ |
1,420,275 |
|
|
$ |
1,153,800 |
|
|
$ |
678,464 |
|
|
$ |
927,780 |
|
$ |
4,497,921 |
|
|
$ |
3,955,438 |
|
Originations for investment |
105,911 |
|
|
154,897 |
|
|
106,237 |
|
|
93,689 |
|
|
93,275 |
|
460,734 |
|
|
258,930 |
|
Total originations |
$ |
1,351,293 |
|
|
$ |
1,575,172 |
|
|
$ |
1,260,037 |
|
|
$ |
772,153 |
|
|
$ |
1,021,055 |
|
$ |
4,958,655 |
|
|
$ |
4,214,368 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchases
as a percentage of originations for sale |
40 |
% |
|
48 |
% |
|
63 |
% |
|
67 |
% |
|
71 |
% |
52 |
% |
|
75 |
% |
Refinances as a percentage of originations for sale |
60 |
|
|
52 |
|
|
37 |
|
|
33 |
|
|
29 |
|
48 |
|
|
25 |
|
Total |
100 |
% |
|
100 |
% |
|
100 |
% |
|
100 |
% |
|
100 |
% |
100 |
% |
|
100 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Production Margin: |
|
|
|
|
|
|
|
|
|
|
|
|
Production revenue (B) (1) |
$ |
34,622 |
|
|
$ |
40,924 |
|
|
$ |
29,895 |
|
|
$ |
16,606 |
|
|
$ |
18,657 |
|
$ |
122,047 |
|
|
$ |
92,250 |
|
Production margin (B / A) |
2.78 |
% |
|
2.88 |
% |
|
2.59 |
% |
|
2.45 |
% |
|
2.01 |
% |
2.71 |
% |
|
2.33 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Mortgage Servicing: |
|
|
|
|
|
|
|
|
|
|
|
|
Loans
serviced for others (C) |
$ |
8,243,251 |
|
|
$ |
7,901,045 |
|
|
$ |
7,515,186 |
|
|
$ |
7,014,269 |
|
|
$ |
6,545,870 |
|
|
|
|
MSRs, at
fair value (D) |
85,638 |
|
|
75,585 |
|
|
72,850 |
|
|
71,022 |
|
|
75,183 |
|
|
|
|
Percentage of MSRs to loans serviced for others (D / C) |
1.04 |
% |
|
0.96 |
% |
|
0.97 |
% |
|
1.01 |
% |
|
1.15 |
% |
|
|
|
Servicing
income |
$ |
6,247 |
|
|
$ |
5,989 |
|
|
$ |
5,460 |
|
|
$ |
5,460 |
|
|
$ |
4,917 |
|
$ |
23,156 |
|
|
$ |
15,269 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Components of MSRs: |
|
|
|
|
|
|
|
|
|
|
|
|
MSR -
current period capitalization |
$ |
14,532 |
|
|
$ |
14,029 |
|
|
$ |
9,802 |
|
|
$ |
6,580 |
|
|
$ |
9,683 |
|
$ |
44,943 |
|
|
$ |
33,061 |
|
MSR -
collection of expected cash flows - paydowns |
(483 |
) |
|
(456 |
) |
|
(457 |
) |
|
(505 |
) |
|
(496 |
) |
(1,901 |
) |
|
(2,267 |
) |
MSR -
collection of expected cash flows - payoffs |
(6,325 |
) |
|
(6,781 |
) |
|
(3,619 |
) |
|
(1,492 |
) |
|
(896 |
) |
(18,217 |
) |
|
(2,772 |
) |
Valuation: |
|
|
|
|
|
|
|
|
|
|
|
|
MSR - changes in fair value model assumptions |
2,329 |
|
|
(4,058 |
) |
|
(4,305 |
) |
|
(8,744 |
) |
|
(7,638 |
) |
(14,778 |
) |
|
(331 |
) |
(Loss) gain on derivative contract held as an economic hedge,
net |
(483 |
) |
|
82 |
|
|
920 |
|
|
— |
|
|
— |
|
519 |
|
|
— |
|
MSR valuation adjustment, net of (loss)/gain on derivative contract
held as an economic hedge |
$ |
1,846 |
|
|
$ |
(3,976 |
) |
|
$ |
(3,385 |
) |
|
$ |
(8,744 |
) |
|
$ |
(7,638 |
) |
$ |
(14,259 |
) |
|
$ |
(331 |
) |
(1) |
Production revenue represents revenue earned from the
origination and subsequent sale of mortgages, including gains on
loans sold and fees from originations, processing and other related
activities, and excludes servicing fees, changes in the fair value
of servicing rights and changes to the mortgage recourse
obligation. |
TABLE 17: NON-INTEREST EXPENSE
|
Three Months Ended |
|
Q4 2019 compared to
Q3 2019 |
|
Q4 2019 compared to
Q4 2018 |
|
Dec 31, |
|
Sep 30, |
|
Jun 30, |
|
Mar 31, |
|
Dec 31, |
|
|
(Dollars in thousands) |
2019 |
|
2019 |
|
2019 |
|
2019 |
|
2018 |
|
$ Change |
|
% Change |
|
$ Change |
|
% Change |
Salaries and employee benefits: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Salaries |
$ |
82,888 |
|
|
$ |
78,067 |
|
|
$ |
75,360 |
|
|
$ |
74,037 |
|
|
$ |
67,708 |
|
|
$ |
4,821 |
|
|
6 |
% |
|
$ |
15,180 |
|
|
22 |
% |
Commissions and incentive compensation |
40,226 |
|
|
40,289 |
|
|
36,486 |
|
|
31,599 |
|
|
33,656 |
|
|
(63 |
) |
|
— |
|
|
6,570 |
|
|
20 |
|
Benefits |
22,827 |
|
|
22,668 |
|
|
21,886 |
|
|
20,087 |
|
|
20,747 |
|
|
159 |
|
|
1 |
|
|
2,080 |
|
|
10 |
|
Total salaries and employee benefits |
145,941 |
|
|
141,024 |
|
|
133,732 |
|
|
125,723 |
|
|
122,111 |
|
|
4,917 |
|
|
3 |
|
|
23,830 |
|
|
20 |
|
Equipment |
14,485 |
|
|
13,314 |
|
|
12,759 |
|
|
11,770 |
|
|
11,523 |
|
|
1,171 |
|
|
9 |
|
|
2,962 |
|
|
26 |
|
Operating lease equipment |
9,766 |
|
|
8,907 |
|
|
8,768 |
|
|
8,319 |
|
|
8,462 |
|
|
859 |
|
|
10 |
|
|
1,304 |
|
|
15 |
|
Occupancy, net |
17,132 |
|
|
14,991 |
|
|
15,921 |
|
|
16,245 |
|
|
15,980 |
|
|
2,141 |
|
|
14 |
|
|
1,152 |
|
|
7 |
|
Data processing |
7,569 |
|
|
6,522 |
|
|
6,204 |
|
|
7,525 |
|
|
8,447 |
|
|
1,047 |
|
|
16 |
|
|
(878 |
) |
|
(10 |
) |
Advertising and marketing |
12,517 |
|
|
13,375 |
|
|
12,845 |
|
|
9,858 |
|
|
9,414 |
|
|
(858 |
) |
|
(6 |
) |
|
3,103 |
|
|
33 |
|
Professional fees |
7,650 |
|
|
8,037 |
|
|
6,228 |
|
|
5,556 |
|
|
9,259 |
|
|
(387 |
) |
|
(5 |
) |
|
(1,609 |
) |
|
(17 |
) |
Amortization of other intangible assets |
3,017 |
|
|
2,928 |
|
|
2,957 |
|
|
2,942 |
|
|
1,407 |
|
|
89 |
|
|
3 |
|
|
1,610 |
|
|
N |
M |
FDIC insurance |
1,348 |
|
|
148 |
|
|
4,127 |
|
|
3,576 |
|
|
4,044 |
|
|
1,200 |
|
|
N |
M |
|
(2,696 |
) |
|
(67 |
) |
OREO expense, net |
536 |
|
|
1,170 |
|
|
1,290 |
|
|
632 |
|
|
1,618 |
|
|
(634 |
) |
|
(54 |
) |
|
(1,082 |
) |
|
(67 |
) |
Other: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Commissions - 3rd party brokers |
717 |
|
|
734 |
|
|
749 |
|
|
718 |
|
|
779 |
|
|
(17 |
) |
|
(2 |
) |
|
(62 |
) |
|
(8 |
) |
Postage |
2,220 |
|
|
2,321 |
|
|
2,606 |
|
|
2,450 |
|
|
2,047 |
|
|
(101 |
) |
|
(4 |
) |
|
173 |
|
|
8 |
|
Miscellaneous |
26,693 |
|
|
21,083 |
|
|
21,421 |
|
|
19,060 |
|
|
16,242 |
|
|
5,610 |
|
|
27 |
|
|
10,451 |
|
|
64 |
|
Total other |
29,630 |
|
|
24,138 |
|
|
24,776 |
|
|
22,228 |
|
|
19,068 |
|
|
5,492 |
|
|
23 |
|
|
10,562 |
|
|
55 |
|
Total Non-Interest Expense |
$ |
249,591 |
|
|
$ |
234,554 |
|
|
$ |
229,607 |
|
|
$ |
214,374 |
|
|
$ |
211,333 |
|
|
$ |
15,037 |
|
|
6 |
% |
|
$ |
38,258 |
|
|
18 |
% |
NM - Not meaningful.
|
Years Ended |
|
|
|
|
Dec 31, |
|
Dec 31, |
$ |
|
% |
(Dollars in thousands) |
2019 |
|
2018 |
Change |
|
Change |
Salaries and employee benefits: |
|
|
|
|
|
|
Salaries |
$ |
310,352 |
|
|
$ |
266,563 |
|
$ |
43,789 |
|
|
16 |
% |
Commissions and incentive compensation |
148,600 |
|
|
135,558 |
|
13,042 |
|
|
10 |
|
Benefits |
87,468 |
|
|
77,956 |
|
9,512 |
|
|
12 |
|
Total salaries and employee benefits |
546,420 |
|
|
480,077 |
|
66,343 |
|
|
14 |
|
Equipment |
52,328 |
|
|
42,949 |
|
9,379 |
|
|
22 |
|
Operating lease equipment |
35,760 |
|
|
29,305 |
|
6,455 |
|
|
22 |
|
Occupancy, net |
64,289 |
|
|
57,814 |
|
6,475 |
|
|
11 |
|
Data processing |
27,820 |
|
|
35,027 |
|
(7,207 |
) |
|
(21 |
) |
Advertising and marketing |
48,595 |
|
|
41,140 |
|
7,455 |
|
|
18 |
|
Professional fees |
27,471 |
|
|
32,306 |
|
(4,835 |
) |
|
(15 |
) |
Amortization of other intangible assets |
11,844 |
|
|
4,571 |
|
7,273 |
|
|
N |
M |
FDIC insurance |
9,199 |
|
|
17,209 |
|
(8,010 |
) |
|
(47 |
) |
OREO expense, net |
3,628 |
|
|
6,120 |
|
(2,492 |
) |
|
(41 |
) |
Other: |
|
|
|
|
|
|
Commissions - 3rd party brokers |
2,918 |
|
|
4,264 |
|
(1,346 |
) |
|
(32 |
) |
Postage |
9,597 |
|
|
8,685 |
|
912 |
|
|
11 |
|
Miscellaneous |
88,257 |
|
|
66,621 |
|
21,636 |
|
|
32 |
|
Total other |
100,772 |
|
|
79,570 |
|
21,202 |
|
|
27 |
|
Total Non-Interest Expense |
$ |
928,126 |
|
|
$ |
826,088 |
|
$ |
102,038 |
|
|
12 |
% |
NM - Not meaningful.
TABLE 18: SUPPLEMENTAL NON-GAAP 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),
taxable-equivalent net interest margin (including its individual
components), the taxable-equivalent efficiency ratio, tangible
common equity ratio, tangible book value per common 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
Company's 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 basis. In this
non-GAAP presentation, net interest income is adjusted to reflect
tax-exempt interest income on an equivalent before-tax basis using
tax rates effective as of the end of the period. This measure
ensures comparability of net interest income arising from both
taxable and tax-exempt sources. Net interest income on a fully
taxable-equivalent 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.
|
Three Months Ended |
Years Ended |
|
Dec 31, |
|
Sep 30, |
|
Jun 30, |
|
Mar 31, |
|
Dec 31, |
Dec 31, |
|
Dec 31, |
(Dollars and shares in thousands) |
2019 |
|
2019 |
|
2019 |
|
2019 |
|
2018 |
2019 |
|
2018 |
Reconciliation of Non-GAAP Net Interest Margin and
Efficiency Ratio: |
|
|
|
(A) Interest Income (GAAP) |
$ |
349,731 |
|
|
$ |
354,627 |
|
|
$ |
346,814 |
|
|
$ |
333,970 |
|
|
$ |
320,596 |
|
$ |
1,385,142 |
|
|
$ |
1,170,810 |
|
Taxable-equivalent adjustment: |
|
|
|
|
|
|
|
|
|
|
|
|
- Loans |
892 |
|
|
978 |
|
|
1,031 |
|
|
1,034 |
|
|
980 |
|
3,935 |
|
|
3,403 |
|
- Liquidity Management Assets |
573 |
|
|
574 |
|
|
568 |
|
|
565 |
|
|
586 |
|
2,280 |
|
|
2,258 |
|
- Other Earning Assets |
1 |
|
|
5 |
|
|
1 |
|
|
2 |
|
|
4 |
|
9 |
|
|
11 |
|
(B) Interest Income (non-GAAP) |
$ |
351,197 |
|
|
$ |
356,184 |
|
|
$ |
348,414 |
|
|
$ |
335,571 |
|
|
$ |
322,166 |
|
$ |
1,391,366 |
|
|
$ |
1,176,482 |
|
(C) Interest Expense (GAAP) |
$ |
87,852 |
|
|
$ |
89,775 |
|
|
$ |
80,612 |
|
|
$ |
71,984 |
|
|
$ |
66,508 |
|
$ |
330,223 |
|
|
$ |
205,907 |
|
(D) Net Interest Income (GAAP) (A minus C) |
$ |
261,879 |
|
|
$ |
264,852 |
|
|
$ |
266,202 |
|
|
$ |
261,986 |
|
|
$ |
254,088 |
|
$ |
1,054,919 |
|
|
$ |
964,903 |
|
(E) Net Interest Income (non-GAAP) (B minus
C) |
$ |
263,345 |
|
|
$ |
266,409 |
|
|
$ |
267,802 |
|
|
$ |
263,587 |
|
|
$ |
255,658 |
|
$ |
1,061,143 |
|
|
$ |
970,575 |
|
Net interest margin (GAAP) |
3.17 |
% |
|
3.37 |
% |
|
3.62 |
% |
|
3.70 |
% |
|
3.61 |
% |
3.45 |
% |
|
3.59 |
% |
Net interest margin, fully taxable-equivalent
(non-GAAP) |
3.19 |
% |
|
3.39 |
% |
|
3.64 |
% |
|
3.72 |
% |
|
3.63 |
% |
3.47 |
% |
|
3.61 |
% |
(F) Non-interest income |
$ |
112,220 |
|
|
$ |
115,137 |
|
|
$ |
98,158 |
|
|
$ |
81,657 |
|
|
$ |
75,308 |
|
$ |
407,172 |
|
|
$ |
356,150 |
|
(G) Gains (losses) on investment securities, net |
587 |
|
|
710 |
|
|
864 |
|
|
1,364 |
|
|
(2,649 |
) |
3,525 |
|
|
(2,898 |
) |
(H) Non-interest expense |
249,591 |
|
|
234,554 |
|
|
229,607 |
|
|
214,374 |
|
|
211,333 |
|
928,126 |
|
|
826,088 |
|
Efficiency ratio (H/(D+F-G)) |
66.82 |
% |
|
61.84 |
% |
|
63.17 |
% |
|
62.63 |
% |
|
63.65 |
% |
63.63 |
% |
|
62.40 |
% |
Efficiency ratio (non-GAAP) (H/(E+F-G)) |
66.56 |
% |
|
61.59 |
% |
|
62.89 |
% |
|
62.34 |
% |
|
63.35 |
% |
63.36 |
% |
|
62.13 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Non-GAAP Tangible Common Equity
Ratio: |
|
|
|
Total shareholders’ equity (GAAP) |
$ |
3,691,250 |
|
|
$ |
3,540,325 |
|
|
$ |
3,446,950 |
|
|
$ |
3,371,972 |
|
|
$ |
3,267,570 |
|
|
|
|
Less: Non-convertible preferred stock (GAAP) |
(125,000 |
) |
|
(125,000 |
) |
|
(125,000 |
) |
|
(125,000 |
) |
|
(125,000 |
) |
|
|
|
Less: Intangible assets (GAAP) |
(692,277 |
) |
|
(627,972 |
) |
|
(631,499 |
) |
|
(620,224 |
) |
|
(622,565 |
) |
|
|
|
(I) Total tangible common shareholders’ equity (non-GAAP) |
$ |
2,873,973 |
|
|
$ |
2,787,353 |
|
|
$ |
2,690,451 |
|
|
$ |
2,626,748 |
|
|
$ |
2,520,005 |
|
|
|
|
(J) Total assets (GAAP) |
$ |
36,620,583 |
|
|
$ |
34,911,902 |
|
|
$ |
33,641,769 |
|
|
$ |
32,358,621 |
|
|
$ |
31,244,849 |
|
|
|
|
Less: Intangible assets (GAAP) |
(692,277 |
) |
|
(627,972 |
) |
|
(631,499 |
) |
|
(620,224 |
) |
|
(622,565 |
) |
|
|
|
(K) Total tangible assets (non-GAAP) |
$ |
35,928,306 |
|
|
$ |
34,283,930 |
|
|
$ |
33,010,270 |
|
|
$ |
31,738,397 |
|
|
$ |
30,622,284 |
|
|
|
|
Common equity to assets ratio (GAAP) (L/J) |
9.7 |
% |
|
9.8 |
% |
|
9.9 |
% |
|
10.0 |
% |
|
10.1 |
% |
|
|
|
Tangible common equity ratio (non-GAAP) (I/K) |
8.0 |
% |
|
8.1 |
% |
|
8.2 |
% |
|
8.3 |
% |
|
8.2 |
% |
|
|
|
|
Three Months Ended |
Years Ended |
|
Dec 31, |
|
Sep 30, |
|
Jun 30, |
|
Mar 31, |
|
Dec 31, |
Dec 31, |
|
Dec 31, |
(Dollars and shares in thousands) |
2019 |
|
2019 |
|
2019 |
|
2019 |
|
2018 |
2019 |
|
2018 |
Reconciliation of Non-GAAP Tangible Book Value per Common
Share: |
|
|
|
Total shareholders’ equity |
$ |
3,691,250 |
|
|
$ |
3,540,325 |
|
|
$ |
3,446,950 |
|
|
$ |
3,371,972 |
|
|
$ |
3,267,570 |
|
|
|
|
Less: Preferred stock |
(125,000 |
) |
|
(125,000 |
) |
|
(125,000 |
) |
|
(125,000 |
) |
|
(125,000 |
) |
|
|
|
(L) Total common equity |
$ |
3,566,250 |
|
|
$ |
3,415,325 |
|
|
$ |
3,321,950 |
|
|
$ |
3,246,972 |
|
|
$ |
3,142,570 |
|
|
|
|
(M) Actual common shares outstanding |
57,822 |
|
|
56,698 |
|
|
56,668 |
|
|
56,639 |
|
|
56,408 |
|
|
|
|
Book value per common share (L/M) |
$ |
61.68 |
|
|
$ |
60.24 |
|
|
$ |
58.62 |
|
|
$ |
57.33 |
|
|
$ |
55.71 |
|
|
|
|
Tangible book value per common share (non-GAAP)
(I/M) |
$ |
49.70 |
|
|
$ |
49.16 |
|
|
$ |
47.48 |
|
|
$ |
46.38 |
|
|
$ |
44.67 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of Non-GAAP Return on Average Tangible
Common Equity: |
|
|
|
(N) Net income applicable to common shares |
$ |
83,914 |
|
|
$ |
97,071 |
|
|
$ |
79,416 |
|
|
$ |
87,096 |
|
|
$ |
77,607 |
|
$ |
347,497 |
|
|
$ |
334,966 |
|
Add: Intangible asset amortization |
3,017 |
|
|
2,928 |
|
|
2,957 |
|
|
2,942 |
|
|
1,407 |
|
11,844 |
|
|
4,571 |
|
Less: Tax effect of intangible asset amortization |
(793 |
) |
|
(773 |
) |
|
(771 |
) |
|
(731 |
) |
|
(366 |
) |
(3,068 |
) |
|
(1,164 |
) |
After-tax intangible asset amortization |
2,224 |
|
|
2,155 |
|
|
2,186 |
|
|
2,211 |
|
|
1,041 |
|
8,776 |
|
|
3,407 |
|
(O) Tangible net income applicable to common shares (non-GAAP) |
$ |
86,138 |
|
|
$ |
99,226 |
|
|
$ |
81,602 |
|
|
$ |
89,307 |
|
|
$ |
78,648 |
|
$ |
356,273 |
|
|
$ |
338,373 |
|
Total average shareholders' equity |
$ |
3,622,184 |
|
|
$ |
3,496,714 |
|
|
$ |
3,414,340 |
|
|
$ |
3,309,078 |
|
|
$ |
3,200,654 |
|
$ |
3,461,535 |
|
|
$ |
3,098,740 |
|
Less: Average preferred stock |
(125,000 |
) |
|
(125,000 |
) |
|
(125,000 |
) |
|
(125,000 |
) |
|
(125,000 |
) |
(125,000 |
) |
|
(125,000 |
) |
(P) Total average common shareholders' equity |
$ |
3,497,184 |
|
|
$ |
3,371,714 |
|
|
$ |
3,289,340 |
|
|
$ |
3,184,078 |
|
|
$ |
3,075,654 |
|
$ |
3,336,535 |
|
|
$ |
2,973,740 |
|
Less: Average intangible assets |
(689,286 |
) |
|
(630,279 |
) |
|
(624,794 |
) |
|
(622,240 |
) |
|
(574,757 |
) |
(641,802 |
) |
|
(548,223 |
) |
(Q) Total average tangible common shareholders’ equity
(non-GAAP) |
$ |
2,807,898 |
|
|
$ |
2,741,435 |
|
|
$ |
2,664,546 |
|
|
$ |
2,561,838 |
|
|
$ |
2,500,897 |
|
$ |
2,694,733 |
|
|
$ |
2,425,517 |
|
Return on average common equity, annualized
(N/P) |
9.52 |
% |
|
11.42 |
% |
|
9.68 |
% |
|
11.09 |
% |
|
10.01 |
% |
10.41 |
% |
|
11.26 |
% |
Return on average tangible common equity, annualized
(non-GAAP) (O/Q) |
12.17 |
% |
|
14.36 |
% |
|
12.28 |
% |
|
14.14 |
% |
|
12.48 |
% |
13.22 |
% |
|
13.95 |
% |
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, N.A., Hinsdale Bank & Trust
Company, N.A., Wintrust Bank, N.A., in Chicago, Libertyville
Bank & Trust Company, N.A., Barrington Bank &
Trust Company, N.A., Crystal Lake Bank & Trust Company,
N.A., Northbrook Bank & Trust Company, N.A., Schaumburg
Bank & Trust Company, N.A., Village Bank & Trust,
N.A., in Arlington Heights, Beverly Bank & Trust Company,
N.A. in Chicago, Wheaton Bank & Trust Company, N.A., State
Bank of The Lakes, N.A., in Antioch, Old Plank Trail Community
Bank, N.A. in New Lenox, St. Charles Bank & Trust Company,
N.A. and Town Bank, N.A., in Hartland, Wisconsin.
In addition to the locations noted above, the banks also operate
facilities in Illinois in Addison, Algonquin, Aurora, Bloomingdale,
Buffalo Grove, Burbank, Cary, Clarendon Hills, Crete, Countryside,
Darien, Deerfield, Des Plaines, Downers Grove, Elgin, Elk Grove
Village, Elmhurst, Evanston, Evergreen Park, Frankfort, Geneva,
Glen Ellyn, Glencoe, Glenview, Gurnee, Grayslake, Hanover Park,
Highland Park, Highwood, Hoffman Estates, Homer Glen, Island Lake,
Itasca, Joliet, Lake Bluff, Lake Villa, Lansing, Lemont,
Lindenhurst, Lynwood, Markham, Maywood, McHenry, Mokena, Mount
Prospect, Mundelein, Naperville, North Chicago, Northfield,
Norridge, Oak Lawn, Oak Brook, Orland Park, Palatine, Park Ridge,
Prospect Heights, Ravinia, Riverside, Rolling Meadows, Roselle,
Round Lake Beach, Shorewood, Skokie, South Holland, South Elgin,
Spring Grove, Steger, Stone Park, Vernon Hills, Wauconda, Waukegan,
Western Springs, Willowbrook, Wilmette, Winnetka and Wood Dale, and
in Wisconsin in Albany, Burlington, Clinton, Darlington, Delafield,
Delavan, Elm Grove, Genoa City, Kenosha, Lake Geneva, Madison,
Menomonee Falls, Milwaukee, Monroe, Pewaukee, Racine, Sharon,
Wales, Walworth and Wind Lake, and in Dyer, Indiana and in
Naples, Florida.
Additionally, the Company operates various non-bank business
units:
- FIRST Insurance Funding, a division of Lake Forest Bank &
Trust Company, N.A., and Wintrust Life Finance, a division of Lake
Forest Bank & Trust Company, N.A., serve commercial and life
insurance loan customers, respectively, throughout the United
States.
- 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, N.A., 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.
- Wintrust 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, N.A., a trust subsidiary, allows
Wintrust to service customers’ trust and investment needs at each
banking location.
- Wintrust Asset Finance offers direct leasing
opportunities.
- CDEC provides Qualified Intermediary services (as defined by
U.S. Treasury regulations) for taxpayers seeking to structure
tax-deferred like-kind exchanges under Internal Revenue Code
Section 1031.
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,” “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 2018
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:
- economic conditions that affect the economy, housing prices,
the job market and other factors that may adversely affect the
Company’s liquidity and the performance of its loan portfolios,
particularly in the markets in which it operates;
- negative effects suffered by us or our customers resulting from
changes in U.S. trade policies;
- 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;
- commercial real estate market conditions 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),
which may result in loss of market share and reduced income from
deposits, loans, advisory fees and income from other products;
- 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;
- harm to the Company’s reputation;
- any negative perception of the Company’s financial
strength;
- ability of the Company 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 of the Company to use technology to provide products
and services that will satisfy customer demands and create
efficiencies in operations and to manage risks associated
therewith;
- failure or breaches of our security systems or infrastructure,
or those of third parties;
- security breaches, including denial of service attacks,
hacking, social engineering attacks, malware intrusion or data
corruption attempts and identity theft;
- adverse effects on our information technology systems resulting
from failures, human error or cyberattacks;
- 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 to which the Company
is subject, including any effect on our reputation;
- losses incurred in connection with repurchases and
indemnification payments related to mortgages and increases in
reserves associated therewith;
- 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, and any
unanticipated impact of the Tax Act;
- changes in accounting standards, rules and interpretations such
as the new CECL standard, and the impact on the Company’s financial
statements;
- the ability of the Company to receive dividends from its
subsidiaries;
- uncertainty about the discontinued use of LIBOR and transition
to an alternative rate;
- a decrease in the Company’s capital ratios, including as a
result of 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;
- a lowering of our credit rating;
- changes in U.S. monetary policy and changes to the Federal
Reserve’s balance sheet as a result of the end of its program of
quantitative easing or otherwise;
- 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 regulatory environment;
- 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 or events 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, WEBCAST AND REPLAY
The Company will hold a conference call on
Wednesday, January 22, 2020 at 10:00 a.m. (Central Time) regarding
fourth quarter 2019 results. Individuals interested in listening
should call (877) 363-5049 and enter Conference ID #5079486. A
simultaneous audio-only webcast and replay of the conference call
as well as an accompanying slide presentation may be accessed via
the Company’s website at https://www.wintrust.com, Investor
Relations, Investor News and Events, Presentations &
Conference Calls. The text of the fourth quarter 2019 earnings
press release will be available on the home page of the Company’s
website at https://www.wintrust.com and at the Investor Relations,
Investor News and Events, Press Releases link on its website.
FOR MORE INFORMATION
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
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