SNV
$38.81
Synovus Financial
($1.35)
(3.36%)
Earnings Details
3rd Quarter September 2019
Tuesday, October 22, 2019 6:30:00 AM
Tweet Share Watch
Summary

Synovus Financial Misses

Synovus Financial (SNV) reported 3rd Quarter September 2019 earnings of $0.97 per share on revenue of $612.2 million. The consensus earnings estimate was $1.00 per share on revenue of $488.7 million. The Earnings Whisper number was $1.01 per share. Revenue grew 47.3% on a year-over-year basis.

Synovus Financial Corp is a financial services company and a registered bank holding company. It provides integrated financial services including commercial and retail banking, financial management, insurance and mortgage services.

Results
Reported Earnings
$0.97
Earnings Whisper
$1.01
Consensus Estimate
$1.00
Reported Revenue
$612.2 Mil
Revenue Estimate
$488.7 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Synovus Announces Earnings for the Third Quarter 2019

Diluted Earnings per Share of $0.83, down 1.6% vs. $0.84 in 3Q18

Adjusted Diluted Earnings per Share of $0.97, up 2.9% vs. $0.94 in 3Q18

COLUMBUS, Ga.--(BUSINESS WIRE)--Synovus Financial Corp. (NYSE: SNV) today reported financial results for the quarter ended September 30, 2019.

Third Quarter 2019 Highlights

  • Diluted EPS of $0.83; adjusted diluted EPS of $0.97, down 2.7% sequentially and up 2.9% year-over-year.
  • Period-end loan growth of $279.3 million, or 3.1% annualized, from prior quarter.
  • Non-interest-bearing deposits excluding public funds increased $392.6 million sequentially or 18.2% annualized.
  • Net interest margin of 3.69%, unchanged from the previous quarter. Excluding the impact of purchase accounting adjustments (PAA), net interest margin was 3.42%, down 6 basis points from the prior quarter.
  • Non-interest income declined by $1.0 million from the second quarter but grew $1.1 million or 1.2% sequentially on an adjusted basis.
  • Credit quality metrics remained solid, with non-performing loan (NPL) ratio declining 2 basis points and the non-performing asset (NPA) ratio increasing 3 basis points.
  • Repurchased $343.5 million in common stock during the quarter; year-to-date repurchases total $688.5 million of the $725 million repurchase authorization.
  • Completed $350 million Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series E offering on July 1.

Third Quarter Summary

 

Reported

 

Adjusted

(dollars in thousands)

3Q19

 

2Q19

 

3Q18

 

3Q19

 

2Q19

 

3Q18

Net income available to common shareholders

$

127,435

 

 

$

153,034

 

 

$

99,330

 

 

$

149,732

 

 

$

158,892

 

 

$

111,504

 

Diluted earnings per share

0.83

 

 

0.96

 

 

0.84

 

 

0.97

 

 

1.00

 

 

0.94

 

Total loans

36,417,826

 

 

36,138,561

 

 

25,577,116

 

 

N/A

 

N/A

 

N/A

Total deposits

37,433,070

 

 

37,966,722

 

 

26,433,658

 

 

N/A

 

N/A

 

N/A

Total revenues

491,676

 

 

487,880

 

 

363,423

 

 

494,213

 

 

488,270

 

 

362,989

 

Return on avg assets

1.14

%

 

1.34

%

 

1.36

%

 

1.33

%

 

1.39

%

 

1.47

%

Return on avg common equity

11.36

 

 

13.90

 

 

13.95

 

 

13.35

 

 

14.43

 

 

15.66

 

Return on avg tangible common equity

13.19

 

 

16.09

 

 

14.33

 

 

15.46

 

 

16.70

 

 

16.08

 

Net interest margin

3.69

 

 

3.69

 

 

3.89

 

 

3.42

 

 

3.48

 

 

N/A

Efficiency ratio

56.20

 

 

54.14

 

 

60.62

 

 

51.71

 

 

52.08

 

 

55.55

 

Net charge-off ratio

0.22

 

 

0.13

 

 

0.24

 

 

N/A

 

N/A

 

N/A

NPA ratio

0.42

 

 

0.39

 

 

0.46

 

 

N/A

 

N/A

 

N/A

“Our team continues to execute on our strategic priorities, with core transaction deposit growth of $525.5 million, strong funded loan production of $2.6 billion, and solid fee income growth led by our mortgage, wealth, and capital markets teams,” said Kessel D. Stelling, Synovus chairman and CEO. “Credit quality remains strong, and we continue to focus on efficiency and expense management, the crisp execution of our FCB acquisition, talent and technology, and growth in our core business and specialty lines.”

Balance Sheet

Loans**

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(dollars in millions)

3Q19

 

2Q19

 

Linked
Quarter
Change

 

Linked
Quarter %
Change*

 

3Q18

 

Year/Year
Change

 

Year/Year
% Change

Commercial & industrial

$

16,445.3

 

 

$

16,247.5

 

 

$

197.7

 

 

4.8

%

 

$

12,503.3

 

 

$

3,942.0

 

 

31.5

%

Commercial real estate

10,286.0

 

 

10,348.4

 

 

(62.4

)

 

(2.4

)

 

6,712.4

 

 

3,573.6

 

 

53.2

 

Consumer

9,709.2

 

 

9,566.1

 

 

143.1

 

 

5.9

 

 

6,385.2

 

 

3,324.0

 

 

52.1

 

Unearned income

(22.7

)

 

(23.6

)

 

0.9

 

 

(15.1

)

 

(23.8

)

 

1.1

 

 

(4.7

)

Total loans

$

36,417.8

 

 

$

36,138.6

 

 

$

279.3

 

 

3.1

%

 

$

25,577.1

 

 

$

10,840.7

 

 

42.4

%

* Annualized

** Amounts may not total due to rounding

  • Total loans ended the quarter at $36.42 billion, up $279.3 million or 3.1% annualized from the previous quarter.
  • Total funded loan production in the quarter was approximately $2.6 billion.
  • Commercial and industrial loans increased $197.7 million from the second quarter, with contributions from middle market, senior housing, health care, premium finance, and ABL teams.
  • Commercial real estate loans declined by $62.4 million from the prior quarter, as payoff activity accelerated.
  • Consumer loan growth was broad-based, with meaningful contributions from mortgage, lending partnerships, and HELOC growth.

Deposits**

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(dollars in millions)

3Q19

 

2Q19

 

Linked
Quarter
Change

 

Linked
Quarter %
Change*

 

3Q18

 

Year/Year
Change

 

Year/Year
% Change

Non-interest-bearing DDA

$

8,970.2

 

 

$

8,577.6

 

 

$

392.6

 

 

18.2

%

 

$

6,936.7

 

 

$

2,033.5

 

 

29.3

%

Interest-bearing DDA

4,714.8

 

 

4,847.2

 

 

(132.4

)

 

(10.8

)

 

3,943.2

 

 

771.6

 

 

19.6

 

Money market

9,212.1

 

 

8,952.9

 

 

259.3

 

 

11.5

 

 

7,536.2

 

 

1,675.9

 

 

22.2

 

Savings

897.3

 

 

891.2

 

 

6.1

 

 

2.7

 

 

816.5

 

 

80.8

 

 

9.9

 

Public funds

3,795.3

 

 

4,351.3

 

 

(556.0

)

 

(50.7

)

 

2,024.7

 

 

1,770.6

 

 

87.5

 

Time deposits

6,647.8

 

 

7,343.0

 

 

(695.2

)

 

(37.6

)

 

3,492.5

 

 

3,155.3

 

 

90.3

 

Brokered deposits

3,195.5

 

 

3,003.5

 

 

192.0

 

 

25.4

 

 

1,683.8

 

 

1,511.7

 

 

89.8

 

Total deposits

$

37,433.1

 

 

$

37,966.7

 

 

$

(533.7

)

 

(5.6

)%

 

$

26,433.7

 

 

$

10,999.4

 

 

41.6

%

* Annualized

** Amounts may not total due to rounding

  • Total deposits ended the quarter at $37.43 billion, down $533.7 million or 5.6% annualized from second quarter 2019.
  • Deposit costs and mix improved in the quarter, with core transaction deposits increasing $525.5 million, while public funds and CDs declined by $556.0 million and $695.2 million, respectively. Core transaction deposits consist of non-interest bearing, NOW/savings, and money market deposits excluding public and brokered funds.
  • Deposit costs peaked in July; core deposit costs, excluding brokered deposits and PAA, declined 1 basis point from the prior quarter to 0.99%.
  • On a period-end basis, non-interest bearing demand deposit accounts grew $392.6 million, or 18.2% annualized from the second quarter, while money market accounts increased $259.3 million, or 11.5% sequentially. Brokered deposits increased $192.0 million from the prior quarter.
  • The loan to deposit ratio for the quarter was 97.3%, up from 95.2% in the prior quarter, and within our targeted range.

Income Statement Summary**

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(in thousands, except per share data)

3Q19

 

2Q19

 

Linked
Quarter
Change

 

Linked
Quarter %
Change

 

3Q18

 

Year/Year
Change

 

Year/Year
% Change

Net interest income

$

402,097

 

 

$

397,262

 

 

$

4,835

 

 

1.2

%

 

$

291,619

 

 

$

110,478

 

 

37.9

%

Non-interest income

88,760

 

 

89,807

 

 

(1,047

)

 

(1.2

)%

 

71,668

 

 

17,092

 

 

23.8

 

Non-interest expense

276,310

 

 

264,126

 

 

12,184

 

 

4.6

 

 

220,297

 

 

56,013

 

 

25.4

 

Provision expense

27,562

 

 

12,119

 

 

15,443

 

 

127.4

 

 

14,982

 

 

12,580

 

 

84.0

 

Income before taxes

$

186,985

 

 

$

210,824

 

 

$

(23,839

)

 

(11.3

)%

 

$

128,008

 

 

$

58,977

 

 

46.1

%

Income tax expense

51,259

 

 

54,640

 

 

(3,381

)

 

(6.2

)

 

18,949

 

 

32,310

 

 

170.5

 

Preferred stock dividends

8,291

 

 

3,150

 

 

5,141

 

 

163.2

 

 

9,729

 

 

(1,438

)

 

(14.8

)

Net income available to common shareholders

$

127,435

 

 

$

153,034

 

 

$

(25,599

)

 

(16.7

)%

 

$

99,330

 

 

$

28,105

 

 

28.3

%

Weighted average common shares outstanding, diluted

154,043

 

 

159,077

 

 

(5,034

)

 

(3.2

)

 

118,095

 

 

35,948

 

 

30.4

%

Diluted earnings per share

$

0.83

 

 

$

0.96

 

 

$

(0.13

)

 

(14.0

)%

 

$

0.84

 

 

$

(0.01

)

 

(1.6

)

Adjusted diluted earnings per share

$

0.97

 

 

$

1.00

 

 

$

(0.03

)

 

(2.7

)%

 

$

0.94

 

 

$

0.03

 

 

2.9

 

** Amounts may not total due to rounding

nm - not meaningful

Core Performance

  • Total revenues were $491.7 million in the third quarter, up $3.8 million from the previous quarter.
  • Net interest income increased $4.8 million or 1.2% compared to the prior quarter.
  • Net interest margin was 3.69%, unchanged from the previous quarter, and favorably impacted by $16.1 million of loan accretion, $1.7 million of investment securities accretion, and $11.0 million of deposit premium amortization. Excluding the impact of PAA, net interest margin was 3.42%, down 6 basis points from the prior quarter.
    • The sequential decrease in net interest margin was driven by an 8 basis points decline in total earning asset yields and a 2 basis points decrease in the effective cost of funds.
  • Non-interest income decreased $1.0 million or 1.2% from the prior quarter and increased $17.1 million or 23.8% compared to third quarter 2018. Adjusted non-interest income increased $1.1 million or 1.2% from the second quarter and $20.1 million or 28.2% year-over-year.
    • Capital markets fee income in the quarter was $7.4 million, up $6.2 million from the third quarter of 2018. Mortgage revenues in the quarter were $10.4 million, up $2.4 million or 30.9% from the previous quarter and up $5.1 million or 95.7% year-over-year.
  • Non-interest expense increased $12.2 million or 4.6% from the second quarter due primarily to a $10.5 million increase in the earnout liability associated with our 2016 Global One acquisition and a $4.6 million loss on early extinguishment of debt. Adjusted non-interest expense increased $1.8 million or 0.7% from the prior quarter.
    • The increase in adjusted expenses resulted mainly from merit raises and commission expenses, higher occupancy and equipment expenses, amortization of intangibles, and professional expenses.
  • Provision expense was $27.6 million, a $15.4 million increase from the previous quarter, primarily resulting from charge-offs and the impact of gross loan production.
  • The effective tax rate was 27.4% for the quarter and included a $4.4 million discrete tax item associated with state tax reform.

Capital Ratios

 

 

 

 

 

 

 

 

 

3Q19

 

 

2Q19

 

3Q18

Common equity Tier 1 capital (CET1) ratio

8.96

%

(1)

 

9.61

%

 

9.90

%

Tier 1 capital ratio

10.27

 

(1)

 

10.09

 

 

10.57

 

Total risk-based capital ratio

12.30

 

(1)

 

12.11

 

 

12.36

 

Tier 1 leverage ratio

9.02

 

(1)

 

8.89

 

 

9.58

 

Tangible common equity ratio(2)

8.04

 

 

 

8.56

 

 

8.68

 

(1) Ratios are preliminary

(2) Non-GAAP measure; see applicable reconciliation

Capital

  • Capital ratios remained strong.
  • As a result of capital actions during the quarter, the Total Risk Based capital ratio increased to 12.30% and the CET1 ratio decreased to 8.96%, consistent with the low end of our operating range.
  • Repurchased $343.5 million in common stock, or 9.6 million shares, during the quarter; year-to-date repurchases total $688.5 million, or 18.8 million shares, of the $725 million repurchase authorization.
    • Share count has declined by 10.7% from January 1, 2019.
  • Completed $350 million Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series E offering on July 1.

Third Quarter Earnings Conference Call

Synovus will host an earnings highlights conference call at 8:30 a.m. EDT on October 22, 2019. The earnings call will be accompanied by a slide presentation. Shareholders and other interested parties may listen to this conference call via simultaneous Internet broadcast. For a link to the webcast, go to investor.synovus.com/event. The replay will be archived for 12 months and will be available 30-45 minutes after the call.

Synovus Financial Corp. is a financial services company based in Columbus, Georgia, with approximately $48 billion in assets. Synovus provides commercial and retail banking, investment, and mortgage services through 298 branches in Georgia, Alabama, South Carolina, Florida, and Tennessee. Synovus Bank, a wholly owned subsidiary of Synovus, was named one of American Banker’s “Best Banks to Work For” in 2018 and has been recognized as one of the country's “Most Reputable Banks” by American Banker and the Reputation Institute. Synovus is on the web at synovus.com, and on Twitter, Facebook, LinkedIn, and Instagram.

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

These forward-looking statements are based upon information presently known to Synovus’ management and are inherently subjective, uncertain and subject to change due to any number of risks and uncertainties, including, without limitation, the risks and other factors set forth in Synovus’ filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2018, under the captions “Cautionary Notice Regarding Forward-Looking Statements” and “Risk Factors” and in Synovus’ quarterly reports on Form 10-Q and current reports on Form 8-K. We believe these forward-looking statements are reasonable; however, undue reliance should not be placed on any forward-looking statements, which are based on current expectations and speak only as of the date that they are made. We do not assume any obligation to update any forward-looking statements as a result of new information, future developments or otherwise, except as otherwise may be required by law.

Non-GAAP Financial Measures

The measures entitled adjusted non-interest income; adjusted non-interest expense; adjusted total revenues; adjusted tangible efficiency ratio; adjusted net income available to common shareholders; adjusted earnings per diluted share; adjusted return on average assets; adjusted return on average common equity; return on average tangible common equity; adjusted return on average tangible common equity; tangible common equity ratio; and common equity Tier 1 capital (CET1) ratio (fully phased-in) are not measures recognized under GAAP and therefore are considered non-GAAP financial measures. The most comparable GAAP measures to these measures are total non-interest income; total non-interest expense; total revenues; efficiency ratio-FTE; net income available to common shareholders; earnings per diluted common share; return on average assets; return on average common equity; the ratio of total shareholders' equity to total assets; and the CET1 capital ratio, respectively.

Management believes that these non-GAAP financial measures provide meaningful additional information about Synovus to assist management and investors in evaluating Synovus’ operating results, financial strength, the performance of its business, and the strength of its capital position. However, these non-GAAP financial measures have inherent limitations as analytical tools and should not be considered in isolation or as a substitute for analyses of operating results or capital position as reported under GAAP. The non-GAAP financial measures should be considered as additional views of the way our financial measures are affected by significant items and other factors, and since they are not required to be uniformly applied, they may not be comparable to other similarly titled measures at other companies. Adjusted total revenues and adjusted non-interest income are measures used by management to evaluate total revenues and non-interest income exclusive of net investment securities gains (losses) and gains on sales and changes in the fair value of private equity investments, net. Adjusted non-interest expense and the adjusted tangible efficiency ratio are measures utilized by management to measure the success of expense management initiatives focused on reducing recurring controllable operating costs. Adjusted net income available to common shareholders, adjusted earnings per diluted share, adjusted return on average assets, and adjusted return on average common equity are measures used by management to evaluate operating results exclusive of items that are not indicative of ongoing operations and impact period-to-period comparisons. Return on average tangible common equity and adjusted return on average tangible common equity are measures used by management to compare Synovus’ performance with other financial institutions because it calculates the return available to common shareholders without the impact of intangible assets and their related amortization, thereby allowing management to evaluate the performance of the business consistently. The tangible common equity ratio and common equity Tier 1 capital (CET1) ratio (fully phased-in) are used by management and bank regulators to assess the strength of our capital position. The computations of these measures are set forth in the tables below.

 

Reconciliation of Non-GAAP Financial Measures

 

 

 

 

 

 

 

 

 

 

 

(dollars in thousands)

3Q19

 

2Q19

 

3Q18

Adjusted non-interest income

 

 

 

 

 

Total non-interest income

$

88,760

 

 

$

89,807

 

 

$

71,668

 

Add: Investment securities losses, net

3,731

 

 

1,845

 

 

 

Subtract: Gain on sale and fair value increase of private equity investments

(1,194

)

 

(1,455

)

 

(434

)

Adjusted non-interest income

$

91,297

 

 

$

90,197

 

 

$

71,234

 

 

 

 

 

 

 

Adjusted non-interest expense

 

 

 

 

 

Total non-interest expense

$

276,310

 

 

$

264,126

 

 

$

220,297

 

Subtract: Earnout liability adjustments

(10,457

)

 

 

 

(11,652

)

Subtract: Merger-related expense

(353

)

 

(7,401

)

 

(6,684

)

Add/subtract: Restructuring charges, net

66

 

 

(18

)

 

(21

)

Subtract: Valuation adjustment to Visa derivative

(2,500

)

 

 

 

 

Subtract: Loss on early extinguishment of debt, net

(4,592

)

 

 

 

 

Adjusted non-interest expense

$

258,474

 

 

$

256,707

 

 

$

201,940

 

 

 

 

 

 

 

Adjusted total revenues and adjusted tangible efficiency ratio

 

 

 

 

 

Adjusted non-interest expense

$

258,474

 

 

$

256,707

 

 

$

201,940

 

Subtract: Amortization of intangibles

(2,901

)

 

(2,410

)

 

(292

)

Adjusted tangible non-interest expense

$

255,573

 

 

$

254,297

 

 

$

201,648

 

 

 

 

 

 

 

Net interest income

$

402,097

 

 

$

397,262

 

 

$

291,619

 

Add: Tax equivalent adjustment

819

 

 

811

 

 

136

 

Add: Total non-interest income

88,760

 

 

89,807

 

 

71,668

 

Total FTE revenues

491,676

 

 

487,880

 

 

363,423

 

Add: Investment securities losses, net

3,731

 

 

1,845

 

 

 

Subtract: Gain on sale and fair value increase of private equity investments

(1,194

)

 

(1,455

)

 

(434

)

Adjusted total revenues

$

494,213

 

 

$

488,270

 

 

$

362,989

 

Efficiency ratio-FTE

56.20

%

 

54.14

%

 

60.62

%

Adjusted tangible efficiency ratio

51.71

 

 

52.08

 

 

55.55

 

 

 

 

 

 

 

Reconciliation of Non-GAAP Financial Measures, continued

 

 

 

 

 

 

 

 

 

 

 

(in thousands, except per share data)

3Q19

 

2Q19

 

3Q18

Adjusted Return on Average Assets

 

 

 

 

 

Net income

$

135,726

 

 

$

156,184

 

 

$

109,059

 

Add/subtract: Income tax expense (benefit), net related to State Tax Reform and SAB 118

4,402

 

 

 

 

(9,865

)

Add: Earnout liability adjustments

10,457

 

 

 

 

11,652

 

Add: Merger-related expense

353

 

 

7,401

 

 

6,684

 

Subtract/add: Restructuring charges, net

(66

)

 

18

 

 

21

 

Add: Valuation adjustment to Visa derivative

2,500

 

 

 

 

 

Add: Loss on early extinguishment of debt, net

4,592

 

 

 

 

 

Add: Investment securities losses, net

3,731

 

 

1,845

 

 

 

Subtract: Gain on sale and fair value increase of private equity investments

(1,194

)

 

(1,455

)

 

(434

)

Subtract/add: Tax effect of adjustments

(2,478

)

 

(1,951

)

 

96

 

Adjusted net income

$

158,023

 

 

$

162,042

 

 

$

117,213

 

Net income annualized

$

538,478

 

 

$

626,452

 

 

$

432,680

 

Adjusted net income annualized

$

626,939

 

 

$

649,949

 

 

$

465,030

 

Total average assets

$

47,211,026

 

 

$

46,679,769

 

 

$

31,725,604

 

Return on average assets

1.14

%

 

1.34

%

 

1.36

%

Adjusted return on average assets

1.33

 

 

1.39

 

 

1.47

 

 

 

 

 

 

 

Adjusted net income available to common shareholders and adjusted net income per common share, diluted

 

 

 

 

 

Net income available to common shareholders

$

127,435

 

 

$

153,034

 

 

$

99,330

 

Add/subtract: Income tax expense (benefit), net related to State Tax Reform and SAB 118

4,402

 

 

 

 

(9,865

)

Add: Earnout liability adjustments

10,457

 

 

 

 

11,652

 

Add: Preferred stock redemption charge

 

 

 

 

4,020

 

Add: Merger-related expense

353

 

 

7,401

 

 

6,684

 

Subtract/add: Restructuring charges, net

(66

)

 

18

 

 

21

 

Add: Valuation adjustment to Visa derivative

2,500

 

 

 

 

 

Add: Loss on early extinguishment of debt, net

4,592

 

 

 

 

 

Add: Investment securities losses, net

3,731

 

 

1,845

 

 

 

Subtract: Gain on sale and fair value increase of private equity investments

(1,194

)

 

(1,455

)

 

(434

)

Subtract/add: Tax effect of adjustments

(2,478

)

 

(1,951

)

 

96

 

Adjusted net income available to common shareholders

$

149,732

 

 

$

158,892

 

 

$

111,504

 

Weighted average common shares outstanding, diluted

154,043

 

 

159,077

 

 

118,095

 

Net income per common share, diluted

$

0.83

 

 

$

0.96

 

 

$

0.84

 

Adjusted net income per common share, diluted

0.97

 

 

1.00

 

 

0.94

 

 

 

 

 

 

 

Reconciliation of Non-GAAP Financial Measures, continued

 

 

 

 

 

(dollars in thousands)

3Q19

 

2Q19

 

3Q18

 

 

 

 

 

 

Adjusted return on average common equity, return on average tangible common equity, and adjusted return on average tangible common equity

 

 

 

 

 

Net income available to common shareholders

$

127,435

 

 

$

153,034

 

 

$

99,330

 

Add/subtract: Income tax expense (benefit), net related to State Tax Reform and SAB 118

4,402

 

 

 

 

(9,865

)

Add: Earnout liability adjustments

10,457

 

 

 

 

11,652

 

Add: Preferred stock redemption charge

 

 

 

 

4,020

 

Add: Merger-related expense

353

 

 

7,401

 

 

6,684

 

Subtract/add: Restructuring charges, net

(66

)

 

18

 

 

21

 

Add: Valuation adjustment to Visa derivative

2,500

 

 

 

 

 

Add: Loss on early extinguishment of debt, net

4,592

 

 

 

 

 

Add: Investment securities losses, net

3,731

 

 

1,845

 

 

 

Subtract: Gain on sale and fair value increase of private equity investments

(1,194

)

 

(1,455

)

 

(434

)

Subtract/add: Tax effect of adjustments

(2,478

)

 

(1,951

)

 

96

 

Adjusted net income available to common shareholders

$

149,732

 

 

$

158,892

 

 

$

111,504

 

 

 

 

 

 

 

Adjusted net income available to common shareholders annualized

$

594,045

 

 

$

637,314

 

 

$

442,379

 

Add: Amortization of intangibles

8,632

 

 

7,250

 

 

886

 

Adjusted net income available to common shareholders excluding amortization of intangibles annualized

$

602,677

 

 

$

644,564

 

 

$

443,265

 

 

 

 

 

 

 

Net income available to common shareholders annualized

$

505,585

 

 

$

613,818

 

 

$

394,081

 

Add: Amortization of intangibles

8,632

 

 

7,250

 

 

886

 

Net income available to common shareholders excluding amortization of intangibles annualized

$

514,217

 

 

$

621,068

 

 

$

394,967

 

 

 

 

 

 

 

Total average shareholders' equity less preferred stock

$

4,450,301

 

 

$

4,416,705

 

 

$

2,824,707

 

Subtract: Goodwill

(492,320

)

 

(487,601

)

 

(57,315

)

Subtract: Other intangible assets, net

(60,278

)

 

(69,853

)

 

(10,265

)

Total average tangible shareholders' equity less preferred stock

$

3,897,703

 

 

$

3,859,251

 

 

$

2,757,127

 

Return on average common equity

11.36

%

 

13.90

%

 

13.95

%

Adjusted return on average common equity

13.35

 

 

14.43

 

 

15.66

 

Return on average tangible common equity

13.19

 

 

16.09

 

 

14.33

 

Adjusted return on average tangible common equity

15.46

 

 

16.70

 

 

16.08

 

 

Reconciliation of Non-GAAP Financial Measures, continued

 

 

 

 

 

 

September 30,

 

June 30,

 

September 30,

(dollars in thousands)

2019

 

2019

 

2018

Tangible Common Equity Ratio

 

 

 

 

 

 

 

 

 

 

 

Total assets

$

47,661,182

 

 

$

47,318,203

 

 

$

32,075,120

 

Subtract: Goodwill

(487,865

)

 

(492,390

)

 

(57,315

)

Subtract: Other intangible assets, net

(58,572

)

 

(61,473

)

 

(10,166

)

Tangible assets

$

47,114,745

 

 

$

46,764,340

 

 

$

32,007,639

 

 

 

 

 

 

 

Total shareholders’ equity

$

4,868,838

 

 

$

4,753,816

 

 

$

3,040,073

 

Subtract: Goodwill

(487,865

)

 

(492,390

)

 

(57,315

)

Subtract: Other intangible assets, net

(58,572

)

 

(61,473

)

 

(10,166

)

Subtract: Preferred Stock, no par value

(536,550

)

 

(195,140

)

 

(195,138

)

Tangible common equity

$

3,785,851

 

 

$

4,004,813

 

 

$

2,777,454

 

Total shareholders’ equity to total assets ratio

10.22

%

 

10.05

%

 

9.48

%

Tangible common equity ratio

8.04

 

 

8.56

 

 

8.68

 

 

 

 

 

 

 

Reconciliation of Non-GAAP Financial Measures, continued

 

 

September 30,

(dollars in thousands)

2019

CET1 capital ratio (fully phased-in)

 

CET1 capital

$

3,660,078

 

Total risk-weighted assets

$

40,844,402

 

Total risk-weighted assets (fully phased-in)

$

40,912,808

 

CET1 capital ratio

8.96

%

CET1 capital ratio (fully phased-in)

8.95

 

 

 

Synovus

 

 

 

 

 

 

 

 

 

 

 

 

INCOME STATEMENT DATA

 

 

(Unaudited)

 

Nine Months Ended

(Dollars in thousands, except per share data)

 

September 30,

 

 

 

 

 

 

 

 

 

2019

 

2018

 

% Change

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

 

$

1,544,385

 

 

$

986,911

 

 

56.5

%

Interest expense

 

347,850

 

 

136,431

 

 

155.0

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

1,196,535

 

 

850,480

 

 

40.7

 

Provision for loan losses

 

63,250

 

 

39,548

 

 

59.9

 

 

 

 

 

 

 

 

Net interest income after provision for loan losses

 

1,133,285

 

 

810,932

 

 

39.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest income:

 

 

 

 

 

 

Service charges on deposit accounts

 

65,805

 

 

60,521

 

 

8.7

 

Fiduciary and asset management fees

 

42,743

 

 

40,881

 

 

4.6

 

Card fees

 

34,334

 

 

31,640

 

 

8.5

 

Brokerage revenue

 

30,502

 

 

26,125

 

 

16.8

 

Mortgage banking income

 

23,313

 

 

15,177

 

 

53.6

 

Capital markets income

 

21,557

 

 

3,826

 

 

463.4

 

Income from bank-owned life insurance

 

15,605

 

 

11,720

 

 

33.1

 

Investment securities losses, net

 

(5,502

)

 

(1,296

)

 

nm

 

Gain on sale and fair value increase/(decrease) of private equity

investments

 

3,507

 

 

(2,659

)

 

nm

 

Other non-interest income

 

26,081

 

 

26,166

 

 

(0.3

)

 

 

 

 

 

 

 

Total non-interest income

 

257,945

 

 

212,101

 

 

21.6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest expense:

 

 

 

 

 

 

Salaries and other personnel expense

 

424,952

 

 

339,924

 

 

25.0

 

Net occupancy and equipment expense

 

119,262

 

 

96,222

 

 

23.9

 

Third-party processing expense

 

55,403

 

 

43,822

 

 

26.4

 

Professional fees

 

25,379

 

 

18,087

 

 

40.3

 

FDIC insurance and other regulatory fees

 

21,872

 

 

19,765

 

 

10.7

 

Advertising expense

 

16,996

 

 

14,046

 

 

21.0

 

Amortization of intangibles

 

8,702

 

 

875

 

 

nm

 

Merger-related expense

 

57,493

 

 

6,684

 

 

nm

 

Earnout liability adjustments

 

10,457

 

 

11,652

 

 

(10.3

)

Loss on early extinguishment of debt, net

 

4,592

 

 

 

 

nm

 

Valuation adjustment to Visa derivative

 

2,500

 

 

2,328

 

 

7.4

 

Other operating expenses

 

85,239

 

 

66,126

 

 

28.9

 

 

 

 

 

 

 

 

Total non-interest expense

 

832,847

 

 

619,531

 

 

34.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

558,383

 

 

403,502

 

 

38.4

 

Income tax expense

 

146,287

 

 

80,095

 

 

82.6

 

 

 

 

 

 

 

 

Net income

 

412,096

 

 

323,407

 

 

27.4

 

 

 

 

 

 

 

 

Less: Preferred stock dividends and redemption charge

 

14,591

 

 

14,848

 

 

(1.7

)

 

 

 

 

 

 

 

Net income available to common shareholders

 

$

397,505

 

 

$

308,559

 

 

28.8

%

 

 

 

 

 

 

 

Net income per common share, basic

 

2.53

 

 

2.61

 

 

(3.0

)%

 

 

 

 

 

 

 

Net income per common share, diluted

 

2.51

 

 

2.60

 

 

(3.5

)

 

 

 

 

 

 

 

Cash dividends declared per common share

 

0.90

 

 

0.75

 

 

20.0

 

 

 

 

 

 

 

 

Return on average assets*

 

1.18

%

 

1.37

 

 

(19

)bps

Return on average common equity*

 

12.09

 

 

14.65

 

 

(256

)

 

 

 

 

 

 

 

Weighted average common shares outstanding, basic

 

156,819

 

 

118,096

 

 

32.8

%

Weighted average common shares outstanding, diluted

 

158,595

 

 

118,847

 

 

33.4

 

 

 

 

 

 

 

 

nm - not meaningful

 

 

 

 

 

 

bps - basis points

 

 

 

 

 

 

* - ratios are annualized

 

 

 

 

 

 

 

Synovus

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

INCOME STATEMENT DATA

 

 

 

 

 

 

 

 

 

 

 

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in thousands, except per share data)

2019

 

2018

 

Third
Quarter

 

Third
Quarter

 

Second
Quarter

 

First
Quarter

 

Fourth
Quarter

 

Third
Quarter

 

'19 vs '18

 

 

 

 

% Change

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

$

523,415

 

 

516,131

 

 

504,839

 

 

357,394

 

 

343,942

 

 

52.2

%

Interest expense

121,318

 

 

118,869

 

 

107,664

 

 

59,461

 

 

52,323

 

 

131.9

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

402,097

 

 

397,262

 

 

397,175

 

 

297,933

 

 

291,619

 

 

37.9

 

Provision for loan losses

27,562

 

 

12,119

 

 

23,569

 

 

12,148

 

 

14,982

 

 

84.0

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income after provision for loan losses

374,535

 

 

385,143

 

 

373,606

 

 

285,785

 

 

276,637

 

 

35.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest income:

 

 

 

 

 

 

 

 

 

 

 

Service charges on deposit accounts

22,952

 

 

21,994

 

 

20,859

 

 

20,320

 

 

20,582

 

 

11.5

 

Fiduciary and asset management fees

14,686

 

 

14,478

 

 

13,578

 

 

13,805

 

 

13,462

 

 

9.1

 

Card fees

12,297

 

 

11,161

 

 

10,877

 

 

10,862

 

 

10,608

 

 

15.9

 

Brokerage revenue

11,071

 

 

10,052

 

 

9,379

 

 

9,241

 

 

9,041

 

 

22.5

 

Mortgage banking income

10,351

 

 

7,907

 

 

5,054

 

 

3,781

 

 

5,290

 

 

95.7

 

Capital markets income

7,396

 

 

8,916

 

 

5,245

 

 

1,977

 

 

1,155

 

 

540.3

 

Income from bank-owned life insurance

5,139

 

 

5,176

 

 

5,290

 

 

3,682

 

 

3,771

 

 

36.3

 

Investment securities (losses)/gains, net

(3,731

)

 

(1,845

)

 

75

 

 

 

 

 

 

nm

 

Gain on sale and fair value increase/(decrease) of private equity investments

1,194

 

 

1,455

 

 

858

 

 

(2,084

)

 

434

 

 

nm

 

Other non-interest income

7,405

 

 

10,513

 

 

8,163

 

 

6,407

 

 

7,325

 

 

1.1

 

 

 

 

 

 

 

 

 

 

 

 

 

Total non-interest income

88,760

 

 

89,807

 

 

79,378

 

 

67,991

 

 

71,668

 

 

23.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest expense:

 

 

 

 

 

 

 

 

 

 

 

Salaries and other personnel expense

142,516

 

 

143,009

 

 

139,427

 

 

113,496

 

 

114,341

 

 

24.6

 

Net occupancy and equipment expense

41,017

 

 

39,851

 

 

38,394

 

 

34,260

 

 

32,088

 

 

27.8

 

Third-party processing expense

18,528

 

 

19,118

 

 

17,758

 

 

14,803

 

 

14,810

 

 

25.1

 

Professional Fees

9,719

 

 

9,312

 

 

6,348

 

 

8,650

 

 

6,298

 

 

54.3

 

FDIC insurance and other regulatory fees

7,242

 

 

7,867

 

 

6,761

 

 

4,728

 

 

6,430

 

 

12.6

 

Advertising expense

5,950

 

 

5,923

 

 

5,123

 

 

6,834

 

 

3,735

 

 

59.3

 

Amortization of intangibles

2,901

 

 

2,410

 

 

3,392

 

 

292

 

 

292

 

 

nm

 

Merger-related expense

353

 

 

7,401

 

 

49,738

 

 

3,381

 

 

6,684

 

 

nm

 

Earnout liability adjustments

10,457

 

 

 

 

 

 

 

 

11,652

 

 

(10.3

)

Loss on early extinguishment of debt, net

4,592

 

 

 

 

 

 

 

 

 

 

nm

 

Valuation adjustment to Visa derivative

2,500

 

 

 

 

 

 

 

 

 

 

nm

 

Other operating expenses

30,535

 

 

29,235

 

 

25,469

 

 

23,478

 

 

23,967

 

 

27.4

 

 

 

 

 

 

 

 

 

 

 

 

 

Total non-interest expense

276,310

 

 

264,126

 

 

292,410

 

 

209,922

 

 

220,297

 

 

25.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

186,985

 

 

210,824

 

 

160,574

 

 

143,854

 

 

128,008

 

 

46.1

 

Income tax expense

51,259

 

 

54,640

 

 

40,388

 

 

38,784

 

 

18,949

 

 

170.5

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

135,726

 

 

156,184

 

 

120,186

 

 

105,070

 

 

109,059

 

 

24.5

 

 

 

 

 

 

 

 

 

 

 

 

 

Less: Preferred stock dividends and redemption charge

8,291

 

 

3,150

 

 

3,150

 

 

3,151

 

 

9,729

 

 

(14.8

)

 

 

 

 

 

 

 

 

 

 

 

 

Net income available to common shareholders

$

127,435

 

 

153,034

 

 

117,036

 

 

101,919

 

 

99,330

 

 

28.3

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income per common share, basic

$

0.84

 

 

0.97

 

 

0.73

 

 

0.88

 

 

0.85

 

 

(1.2

)%

 

 

 

 

 

 

 

 

 

 

 

 

Net income per common share, diluted

0.83

 

 

0.96

 

 

0.72

 

 

0.87

 

 

0.84

 

 

(1.6

)

 

 

 

 

 

 

 

 

 

 

 

 

Cash dividends declared per common share

0.30

 

 

0.30

 

 

0.30

 

 

0.25

 

 

0.25

 

 

20.0

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets *

1.14

%

 

1.34

 

 

1.06

 

 

1.29

 

 

1.36

 

 

(22

)bps

Return on average common equity *

11.36

 

 

13.90

 

 

10.98

 

 

14.25

 

 

13.95

 

 

(259

)

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding, basic

152,238

 

 

157,389

 

 

160,927

 

 

116,303

 

 

117,241

 

 

29.9

%

Weighted average common shares outstanding, diluted

154,043

 

 

159,077

 

 

162,760

 

 

116,986

 

 

118,095

 

 

30.4

 

 

 

 

 

 

 

 

 

 

 

 

 

nm - not meaningful

 

 

 

 

 

 

 

 

 

 

 

bps - basis points

 

 

 

 

 

 

 

 

 

 

 

* - ratios are annualized

 

 

 

 

 

 

 

 

 

 

  

 

Synovus

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BALANCE SHEET DATA

 

September 30, 2019

 

December 31, 2018

 

September 30, 2018

 

 

 

 

 

 

 

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands, except share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

Cash and due from banks

 

$

611,496

 

 

$

468,426

 

 

$

436,540

 

Interest-bearing funds with Federal Reserve Bank

 

480,913

 

 

641,476

 

 

515,493

 

Interest earning deposits with banks

 

20,086

 

 

19,841

 

 

34,470

 

Federal funds sold and securities purchased under resale agreements

 

69,975

 

 

13,821

 

 

25,430

 

Cash and cash equivalents

 

1,182,470

 

 

1,143,564

 

 

1,011,933

 

 

 

 

 

 

 

 

Investment securities available for sale, at fair value

 

6,892,162

 

 

3,991,632

 

 

3,883,574

 

Mortgage loans held for sale, at fair value

 

129,415

 

 

37,129

 

 

37,276

 

 

 

 

 

 

 

 

Loans

 

36,417,826

 

 

25,946,573

 

 

25,577,116

 

Allowance for loan losses

 

(265,013

)

 

(250,555

)

 

(251,450

)

Loans, net

 

36,152,813

 

 

25,696,018

 

 

25,325,666

 

 

 

 

 

 

 

 

Cash surrender value of bank-owned life insurance

 

771,458

 

 

554,134

 

 

551,061

 

Premises and equipment, net

 

487,053

 

 

434,307

 

 

431,012

 

Goodwill

 

487,865

 

 

57,315

 

 

57,315

 

Other intangible assets

 

58,572

 

 

9,875

 

 

10,166

 

Other assets

 

1,499,374

 

 

745,218

 

 

767,117

 

Total assets

 

$

47,661,182

 

 

$

32,669,192

 

 

$

32,075,120

 

 

 

 

 

 

 

 

LIABILITIES AND SHAREHOLDERS' EQUITY

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

Non-interest-bearing deposits

 

$

9,586,148

 

 

$

7,650,967

 

 

$

7,628,736

 

Interest-bearing deposits

 

27,846,922

 

 

19,069,355

 

 

18,804,922

 

 

 

 

 

 

 

 

Total deposits

 

37,433,070

 

 

26,720,322

 

 

26,433,658

 

 

 

 

 

 

 

 

Federal funds purchased and securities sold under repurchase agreements

 

197,419

 

 

237,692

 

 

191,145

 

Other short-term borrowings

 

2,233,593

 

 

650,000

 

 

478,540

 

Long-term debt

 

2,153,600

 

 

1,657,157

 

 

1,656,909

 

Other liabilities

 

774,662

 

 

270,419

 

 

274,795

 

Total liabilities

 

42,792,344

 

 

29,535,590

 

 

29,035,047

 

 

 

 

 

 

 

 

Shareholders' equity:

 

 

 

 

 

 

Preferred stock - no par value. Authorized 100,000,000 shares;

22,000,000 shares issued and outstanding at September 30, 2019, 8,000,000 shares issued and outstanding at December 31, 2018 and September 30, 2018

 

536,550

 

 

195,140

 

 

195,138

 

Common stock - $1.00 par value. Authorized 342,857,143 shares; 166,201,048 issued at September 30, 2019, 143,300,449 issued at December 31, 2018, and 143,093,317 issued at September 30, 2018; 147,594,000 outstanding at September 30, 2019, 115,865,510 outstanding at December 31, 2018, and 116,714,463 outstanding at September 30, 2018

 

166,201

 

 

143,300

 

 

143,093

 

Additional paid-in capital

 

3,801,158

 

 

3,060,561

 

 

3,049,233

 

Treasury stock, at cost – 18,607,048 shares at September 30, 2019, 27,434,939 shares at December 31, 2018, and 26,378,854 shares at September 30, 2018

 

(680,081

)

 

(1,014,746

)

 

(974,478

)

Accumulated other comprehensive income (loss), net

 

75,933

 

 

(94,420

)

 

(143,720

)

Retained earnings

 

969,077

 

 

843,767

 

 

770,807

 

Total shareholders’ equity

 

4,868,838

 

 

3,133,602

 

 

3,040,073

 

Total liabilities and shareholders' equity

 

$

47,661,182

 

 

$

32,669,192

 

 

$

32,075,120

 

 

Synovus

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AVERAGE BALANCES AND YIELDS/RATES (1)

 

 

 

 

 

 

 

(Unaudited)

 

 

 

 

 

 

 

(Dollars in thousands)

 

 

 

 

 

 

 

 

 

2019

 

2018

 

 

Third

Second

First

 

Fourth

Third

 

 

Quarter

Quarter

Quarter

 

Quarter

Quarter

Interest Earning Assets

 

 

 

 

 

 

 

Investment securities (2) (4)

 

$

6,831,036

 

6,955,386

 

6,536,199

 

 

4,073,685

 

4,061,328

 

Yield

 

3.14

%

3.03

 

3.06

 

 

2.45

 

2.39

 

Trading account assets (5)

 

$

5,519

 

4,853

 

2,049

 

 

7,493

 

16,646

 

Yield

 

4.01

%

1.83

 

1.30

 

 

1.90

 

2.52

 

Commercial loans (3) (4)

 

$

26,568,194

 

26,353,973

 

26,140,672

 

 

19,150,252

 

19,025,830

 

Yield

 

5.09

%

5.13

 

5.16

 

 

5.13

 

4.98

 

Consumer loans (3)

 

$

9,633,603

 

9,423,427

 

9,180,679

 

 

6,476,026

 

6,298,643

 

Yield

 

5.08

%

5.17

 

5.10

 

 

4.85

 

4.80

 

Allowance for loan losses

 

$

(258,024

)

(259,284

)

(252,815

)

 

(251,098

)

(251,684

)

Loans, net (3)

 

$

35,943,773

 

35,518,116

 

35,068,536

 

 

25,375,180

 

25,072,789

 

Yield

 

5.13

%

5.17

 

5.17

 

 

5.11

 

4.99

 

Mortgage loans held for sale

 

$

99,556

 

70,497

 

34,913

 

 

36,477

 

49,030

 

Yield

 

3.93

%

4.27

 

4.48

 

 

4.79

 

4.71

 

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

 

$

513,160

 

511,488

 

679,477

 

 

641,832

 

544,704

 

Yield

 

2.08

%

2.37

 

2.45

 

 

2.20

 

1.90

 

Federal Home Loan Bank and Federal Reserve Bank Stock (5)

 

$

254,994

 

234,949

 

211,408

 

 

162,369

 

163,568

 

Yield

 

3.85

%

3.29

 

4.82

 

 

4.31

 

4.41

 

Total interest earning assets

 

$

43,648,038

 

43,295,289

 

42,532,582

 

 

30,297,036

 

29,908,065

 

Yield

 

4.78

%

4.79

 

4.80

 

 

4.69

 

4.58

 

Interest-Bearing Liabilities

 

 

 

 

 

 

 

Interest-bearing demand deposits

 

$

6,138,810

 

6,335,953

 

6,393,304

 

 

4,692,804

 

4,701,204

 

Rate

 

0.69

%

0.71

 

0.68

 

 

0.41

 

0.38

 

Money Market accounts

 

$

10,138,783

 

10,024,836

 

10,244,556

 

 

8,050,732

 

7,936,621

 

Rate

 

1.26

%

1.23

 

1.18

 

 

0.89

 

0.72

 

Savings deposits

 

$

900,366

 

904,183

 

901,059

 

 

815,588

 

824,935

 

Rate

 

0.05

%

0.05

 

0.06

 

 

0.04

 

0.03

 

Time deposits under $100,000

 

$

2,100,492

 

2,245,878

 

2,238,568

 

 

1,242,811

 

1,205,987

 

Rate

 

1.39

%

1.39

 

1.24

 

 

1.16

 

0.99

 

Time deposits over $100,000

 

$

5,957,691

 

6,331,665

 

6,211,067

 

 

2,478,649

 

2,273,582

 

Rate

 

1.69

%

1.70

 

1.60

 

 

1.67

 

1.46

 

Non-maturing brokered deposits

 

$

993,078

 

766,718

 

937,629

 

 

349,480

 

358,277

 

Rate

 

2.47

%

2.46

 

2.60

 

 

2.46

 

2.10

 

Brokered time deposits

 

$

2,119,149

 

1,985,589

 

1,845,819

 

 

1,275,276

 

1,414,700

 

Rate

 

2.27

%

2.28

 

2.13

 

 

2.03

 

1.94

 

Total interest-bearing deposits

 

$

28,348,369

 

28,594,822

 

28,772,002

 

 

18,905,340

 

18,715,306

 

Rate

 

1.32

%

1.30

 

1.24

 

 

0.96

 

0.83

 

Federal funds purchased and securities sold under repurchase agreements

 

$

221,045

 

300,168

 

233,076

 

 

194,370

 

230,504

 

Rate

 

0.22

%

0.20

 

0.22

 

 

0.18

 

0.25

 

Other short-term borrowings

 

$

1,307,370

 

1,090,581

 

517,456

 

 

112,228

 

146,794

 

Rate

 

2.31

%

2.59

 

2.58

 

 

2.51

 

2.12

 

Long-term debt

 

$

2,286,221

 

2,114,819

 

1,983,910

 

 

1,657,022

 

1,656,743

 

Rate

 

3.32

%

3.53

 

3.33

 

 

3.06

 

2.87

 

Total interest-bearing liabilities

 

$

32,163,005

 

32,100,390

 

31,506,444

 

 

20,868,960

 

20,749,347

 

Rate

 

1.47

%

1.48

 

1.38

 

 

1.12

 

0.99

 

Non-interest-bearing demand deposits

 

$

9,365,776

 

9,304,839

 

9,054,949

 

 

8,014,761

 

7,672,006

 

Cost of funds

 

1.16

%

1.15

 

1.07

 

 

0.81

 

0.73

 

Net interest margin

 

3.69

%

3.69

 

3.78

 

 

3.92

 

3.89

 

Taxable equivalent adjustment

 

$

819

 

811

 

630

 

 

181

 

136

 

 

 

 

 

 

 

 

 

(1) Yields and rates are annualized.

(2) Excludes net unrealized gains and losses.

(3) Average loans are shown net of unearned income. Non-performing loans are included.

(4) Reflects taxable-equivalent adjustments, using the statutory federal income tax rate of 21%, in adjusting interest on tax-exempt loans and investment securities to a taxable-equivalent basis.

(5) Included as a component of other assets on the consolidated balance sheet. 

 

Synovus

 

 

 

 

 

 

 

 

 

 

 

 

 

 

LOANS OUTSTANDING BY TYPE

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Loans

 

Total Originated
Loans

 

Total Acquired
Loans (1)

 

Total Loans (1)

 

Linked
Quarter

 

Total Loans

 

Year/Year

Loan Type

 

September 30,
2019

 

September 30,
2019

 

September 30,
2019

 

June 30, 2019

 

% Change (2)

 

September 30,
2018

 

% Change

Commercial, Financial, and Agricultural

 

$

9,855,881

 

 

$

8,085,060

 

 

$

1,770,821

 

 

$

9,717,746

 

 

5.6

%

 

$

7,281,466

 

 

35.4

%

Owner-Occupied

 

6,589,391

 

 

5,588,970

 

 

1,000,421

 

 

6,529,797

 

 

3.6

 

 

5,221,828

 

 

26.2

 

Total Commercial & Industrial

 

16,445,272

 

 

13,674,030

 

 

2,771,242

 

 

16,247,543

 

 

4.8

 

 

12,503,294

 

 

31.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Multi-Family

 

2,164,629

 

 

1,446,034

 

 

718,595

 

 

2,113,938

 

 

9.5

 

 

1,330,006

 

 

62.8

 

Hotels

 

1,267,790

 

 

778,882

 

 

488,908

 

 

1,244,512

 

 

7.4

 

 

760,885

 

 

66.6

 

Office Buildings

 

2,157,186

 

 

1,420,951

 

 

736,235

 

 

2,291,617

 

 

(23.3

)

 

1,368,608

 

 

57.6

 

Shopping Centers

 

1,683,848

 

 

939,346

 

 

744,502

 

 

1,677,555

 

 

1.5

 

 

815,696

 

 

106.4

 

Warehouses

 

676,202

 

 

580,015

 

 

96,187

 

 

696,692

 

 

(11.7

)

 

679,184

 

 

(0.4

)

Other Investment Property

 

985,108

 

 

893,131

 

 

91,977

 

 

980,786

 

 

1.7

 

 

711,311

 

 

38.5

 

Total Investment Properties

 

8,934,763

 

 

6,058,359

 

 

2,876,404

 

 

9,005,100

 

 

(3.1

)

 

5,665,690

 

 

57.7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1-4 Family Construction

 

221,905

 

 

168,918

 

 

52,987

 

 

219,032

 

 

5.2

 

 

183,044

 

 

21.2

 

1-4 Family Investment Mortgage

 

516,859

 

 

471,206

 

 

45,653

 

 

528,358

 

 

(8.6

)

 

524,152

 

 

(1.4

)

Total 1-4 Family Properties

 

738,764

 

 

640,124

 

 

98,640

 

 

747,390

 

 

(4.6

)

 

707,196

 

 

4.5

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial Development

 

124,213

 

 

61,209

 

 

63,004

 

 

138,840

 

 

(41.8

)

 

61,608

 

 

101.6

 

Residential Development

 

224,662

 

 

138,704

 

 

85,958

 

 

218,850

 

 

10.5

 

 

91,578

 

 

145.3

 

Land Acquisition

 

263,631

 

 

207,921

 

 

55,710

 

 

238,267

 

 

42.2

 

 

186,334

 

 

41.5

 

Land and Development

 

612,506

 

 

407,834

 

 

204,672

 

 

595,957

 

 

11.0

 

 

339,520

 

 

80.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Commercial Real Estate

 

10,286,033

 

 

7,106,317

 

 

3,179,716

 

 

10,348,447

 

 

(2.4

)

 

6,712,406

 

 

53.2

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer Mortgages

 

5,470,730

 

 

3,398,720

 

 

2,072,010

 

 

5,407,762

 

 

4.6

 

 

2,843,244

 

 

92.4

 

Home Equity Lines

 

1,675,092

 

 

1,616,063

 

 

59,029

 

 

1,650,745

 

 

5.9

 

 

1,465,419

 

 

14.3

 

Credit Cards

 

267,874

 

 

267,874

 

 

 

 

258,283

 

 

14.7

 

 

245,149

 

 

9.3

 

Other Consumer Loans

 

2,295,486

 

 

2,285,319

 

 

10,167

 

 

2,249,337

 

 

8.1

 

 

1,831,385

 

 

25.3

 

Total Consumer

 

9,709,182

 

 

7,567,976

 

 

2,141,206

 

 

9,566,127

 

 

5.9

 

 

6,385,197

 

 

52.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Unearned Income

 

(22,661

)

 

(22,661

)

 

 

 

(23,556

)

 

(15.1

)

 

(23,781

)

 

(4.7

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

$

36,417,826

 

 

$

28,325,662

 

 

$

8,092,164

 

 

$

36,138,561

 

 

3.1

%

 

$

25,577,116

 

 

42.4

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) On 1/1/19 $9.29 B of loans (at fair value) were acquired from FCB. The amounts presented in these columns are net of paydowns and payoffs since acquisition date.

(2) Percentage change is annualized.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

NON-PERFORMING LOANS COMPOSITION (1)

 

 

 

 

 

 

 

 

 

 

 

 

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in thousands)

 

Total
Non-performing
Loans

 

Total Originated
Non-performing
Loans

 

Total Acquired
Non-performing
Loans (2)

 

Total
Non-performing
Loans (3)

 

Linked
Quarter

 

Total
Non-performing
Loans

 

Year/Year

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loan Type

 

September 30,
2019

 

September 30,
2019

 

September 30,
2019

 

June 30, 2019

 

% Change

 

September 30,
2018

 

% Change

Commercial, Financial, and Agricultural

 

$

73,672

 

 

$

64,912

 

 

$

8,760

 

 

$

72,934

 

 

1.0

%

 

$

69,010

 

 

6.8

%

Owner-Occupied

 

9,222

 

 

9,222

 

 

 

 

13,465

 

 

(31.5

)

 

5,708

 

 

61.6

 

Total Commercial & Industrial

 

82,894

 

 

74,134

 

 

8,760

 

 

86,399

 

 

(4.1

)

 

74,718

 

 

10.9

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Multi-Family

 

 

 

 

 

 

 

 

 

 

 

234

 

 

nm

 

Hotels

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Office Buildings

 

290

 

 

238

 

 

52

 

 

300

 

 

(3.3

)

 

166

 

 

74.7

 

Shopping Centers

 

140

 

 

140

 

 

 

 

671

 

 

(79.1

)

 

89

 

 

57.3

 

Warehouses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Investment Property

 

 

 

 

 

 

 

7

 

 

nm

 

 

1,666

 

 

nm

 

Total Investment Properties

 

430

 

 

378

 

 

52

 

 

978

 

 

(56.0

)

 

2,155

 

 

(80.0

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

1-4 Family Construction

 

698

 

 

698

 

 

 

 

208

 

 

235.6

 

 

 

 

nm

 

1-4 Family Investment Mortgage

 

1,520

 

 

1,520

 

 

 

 

1,637

 

 

(7.1

)

 

3,139

 

 

(51.6

)

Total 1-4 Family Properties

 

2,218

 

 

2,218

 

 

 

 

1,845

 

 

20.2

 

 

3,139

 

 

(29.3

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial Development

 

87

 

 

87

 

 

 

 

 

 

 

 

42

 

 

107.1

 

Residential Development

 

1,526

 

 

1,526

 

 

 

 

1,253

 

 

21.8

 

 

3,184

 

 

(52.1

)

Land Acquisition

 

1,419

 

 

1,419

 

 

 

 

1,482

 

 

(4.3

)

 

1,603

 

 

(11.5

)

Land and Development

 

3,032

 

 

3,032

 

 

 

 

2,735

 

 

10.9

 

 

4,829

 

 

(37.2

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Commercial Real Estate

 

5,680

 

 

5,628

 

 

52

 

 

5,558

 

 

2.2

 

 

10,123

 

 

(43.9

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consumer Mortgages

 

10,015

 

 

10,015

 

 

 

 

13,628

 

 

(26.5

)

 

5,313

 

 

88.5

 

Home Equity Lines

 

12,590

 

 

12,590

 

 

 

 

13,830

 

 

(9.0

)

 

14,498

 

 

(13.2

)

Other Consumer Loans

 

4,736

 

 

4,736

 

 

 

 

4,668

 

 

1.5

 

 

3,773

 

 

25.5

 

Total Consumer

 

27,341

 

 

27,341

 

 

 

 

32,126

 

 

(14.9

)

 

23,584

 

 

15.9

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total

 

$

115,915

 

 

$

107,103

 

 

$

8,812

 

 

$

124,083

 

 

(6.6

)%

 

$

108,425

 

 

6.9

%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) For purposes of this table, 2019 non-performing loans exclude acquired loans accounted for under ASC 310-30 that are currently accruing income.

(2) Represents loans acquired from FCB and designated as non-accrual, net of payments and dispositions since acquisition date

(3) June 30, 2019 total non-performing loans included $7.0 million of acquired non-performing loans, net of payments and dispositions since acquisition date. 

 

Synovus

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CREDIT QUALITY DATA

 

 

(Unaudited)

 

 

 

 

 

 

 

 

(Dollars in thousands)

2019

 

2018

 

Third
Quarter

 

 

Third

 

Second

 

First

 

Fourth

 

Third

 

'19 vs '18

 

 

Quarter

 

Quarter

 

Quarter

 

Quarter

 

Quarter

 

% Change

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-performing Loans (1)

 

$

115,915

 

 

124,083

 

 

143,976

 

 

106,733

 

 

108,425

 

 

6.9

%

Other Real Estate and Other Assets

 

35,400

 

 

15,479

 

 

11,341

 

 

7,726

 

 

8,554

 

 

313.8

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-performing Assets (1)

 

151,315

 

 

139,562

 

 

155,317

 

 

114,459

 

 

116,979

 

 

29.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for Loan Losses

 

265,013

 

 

257,376

 

 

257,036

 

 

250,555

 

 

251,450

 

 

5.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Charge-Offs - Quarter

 

19,924

 

 

11,778

 

 

17,088

 

 

13,044

 

 

15,257

 

 

 

Net Charge-Offs - YTD

 

48,791

 

 

28,867

 

 

17,088

 

 

50,410

 

 

37,366

 

 

 

Net Charge-Offs / Average Loans - Quarter (2)

 

0.22

%

 

0.13

 

 

0.19

 

 

0.20

 

 

0.24

 

 

 

Net Charge-Offs / Average Loans - YTD (2)

 

0.18

 

 

0.16

 

 

0.19

 

 

0.20

 

 

0.20

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-performing Loans / Loans (1)

 

0.32

 

 

0.34

 

 

0.40

 

 

0.41

 

 

0.42

 

 

 

Non-performing Assets / Loans, ORE and specific other assets (1)

 

0.42

 

 

0.39

 

 

0.44

 

 

0.44

 

 

0.46

 

 

 

Allowance / Loans

 

0.73

 

 

0.71

 

 

0.72

 

 

0.97

 

 

0.98

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance / Non-performing Loans (1)

 

228.63

 

 

207.42

 

 

178.53

 

 

234.75

 

 

231.91

 

 

 

Allowance / Non-performing Loans excluding impaired and acquired loans with no reserve (1)

 

363.63

 

 

282.51

 

 

291.62

 

 

297.68

 

 

288.21

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Past Due Loans over 90 days and Still Accruing (1)

 

$

15,660

 

 

5,851

 

 

4,486

 

 

3,798

 

 

4,856

 

 

222.5

 

As a Percentage of Loans Outstanding

 

0.04

%

 

0.02

 

 

0.01

 

 

0.01

 

 

0.02

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Past Due Loans and Still Accruing (1)

 

$

88,219

 

 

80,792

 

 

88,135

 

 

56,927

 

 

78,323

 

 

12.6

 

As a Percentage of Loans Outstanding

 

0.24

%

 

0.22

 

 

0.25

 

 

0.22

 

 

0.31

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accruing Troubled Debt Restructurings (TDRs)

 

$

130,019

 

 

126,369

 

 

112,205

 

 

115,588

 

 

114,740

 

 

13.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) For purposes of this table, 2019 non-performing loans exclude acquired loans accounted for under ASC 310-30 that are currently accruing income.

(2) Ratio is annualized.

 

 

 

 

 

 

 

 

 

 

 

 

 

SELECTED CAPITAL INFORMATION (1)

 

 

 

 

 

 

 

 

 

 

 

 

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30,
2019

 

December 31,
2018

 

September 30,
2018

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Tier 1 Capital

 

$

4,196,628

 

 

3,090,416

 

 

3,038,768

 

 

 

 

 

 

 

Total Risk-Based Capital

 

5,023,138

 

 

3,601,376

 

 

3,550,686

 

 

 

 

 

 

 

Common Equity Tier 1 Capital Ratio

 

8.96

%

 

9.95

 

 

9.90

 

 

 

 

 

 

 

Common Equity Tier 1 Ratio (fully phased-in) (5)

 

8.95

 

 

9.92

 

 

9.86

 

 

 

 

 

 

 

Tier 1 Capital Ratio

 

10.27

 

 

10.61

 

 

10.57

 

 

 

 

 

 

 

Total Risk-Based Capital Ratio

 

12.30

 

 

12.37

 

 

12.36

 

 

 

 

 

 

 

Tier 1 Leverage Ratio

 

9.02

 

 

9.60

 

 

9.58

 

 

 

 

 

 

 

Common Equity as a Percentage of Total Assets (2)

 

9.09

 

 

8.99

 

 

8.87

 

 

 

 

 

 

 

Tangible Common Equity Ratio (3) (5)

 

8.04

 

 

8.81

 

 

8.68

 

 

 

 

 

 

 

Book Value Per Common Share (4)

 

$

29.35

 

 

25.36

 

 

24.38

 

 

 

 

 

 

 

Tangible Book Value Per Common Share (3)

 

25.65

 

 

24.78

 

 

23.80

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Current quarter regulatory capital information is preliminary.

(2) Common equity consists of Total Shareholders' Equity less Preferred Stock.

(3) Excludes the carrying value of goodwill and other intangible assets from common equity and total assets.

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

(5) See "Non-GAAP Financial Measures" of this report for applicable reconciliation.

 

Media Contact
Lee Underwood
Media Relations
(706) 644-0528

Investor Contact
Steve Adams
Investor Relations
(706) 641-6462

Source: Synovus Financial Corp.