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United Community Banks, Inc. Announces Results for Fourth Quarter 2008
United Community Banks, Inc. Announces Results for Fourth Quarter 2008
Jan 23, 2009
BLAIRSVILLE, GA, Jan 23, 2009 (MARKET WIRE via COMTEX News Network) -- United Community Banks, Inc. (NASDAQ: UCBI) today announced a net loss of $46.7 million, or 99 cents per diluted share, for the fourth quarter of 2008, compared to net income of $4.2 million, or 9 cents per diluted share, for the same time last year. For the year 2008, the company had a net loss of $63.5 million, or $1.35 per diluted share, compared to net income of $58.0 million, or $1.24 per diluted share, for 2007.
"Challenges in the housing market, particularly in Atlanta, continued to have a significant impact on our loan portfolio and earnings in the fourth quarter," said Jimmy Tallent, president and chief executive officer. "We saw a rise in the level of classified and non-performing assets and further deterioration in property valuations. While we remain committed to moving through this down cycle as quickly as possible, it is clearly a very difficult environment."
For the fourth quarter of 2008, loans were $5.7 billion, down $224 million from a year ago and down $125 million on a linked-quarter basis, reflecting the company's continuing efforts to reduce exposure to the residential construction and housing markets. At December 31, 2008, residential construction loans were $1.5 billion, or 26 percent of total loans, a decrease of $350 million from a year ago and $117 million from the third quarter.
Taxable equivalent net interest revenue of $51.9 million reflected a decrease of $6.9 million from the third quarter of 2008 and $17.9 million from the fourth quarter of 2007. Taxable equivalent net interest margin was 2.70 percent compared with 3.17 percent for the third quarter of 2008 and 3.73 percent for the fourth quarter of 2007.
"Margin compression was primarily driven by actions taken late in the third quarter and early in the fourth quarter to build liquidity in a very fragile banking environment," stated Tallent. "Banks were not lending to other banks and consumers were concerned about bank failures and FDIC insurance levels on their deposits. About two-thirds of the margin compression was due to our aggressive actions to build liquidity and the remaining third was due to the higher level of non-performing assets and the steep decline in the targeted federal funds rate impacting our asset sensitive balance sheet," added Tallent.
"With liquidity improving late in the quarter we are letting brokered deposits run-off," stated Tallent. "Also, we have lowered our deposit pricing and widened the credit spreads on our prime based loans. With the actions we have taken and liquidity remaining stable, we expect a measurable improvement in our margin, approaching 3 percent by the end of the first quarter of 2009."
The fourth quarter provision for loan losses was $85.0 million. Net charge-offs for the quarter were $74.0 million compared with $55.7 million for the third quarter of 2008. At quarter-end, non-performing assets totaled $250.5 million compared with $177.7 million at September 30, 2008. The ratio of non-performing assets to total assets at year-end and at the end of the third quarter was 2.94 percent and 2.20 percent, respectively.
"The down economic cycle continued to impact our credit quality, particularly within the Atlanta residential construction portfolio," stated Tallent. "The rise in non-performing assets was primarily the result of continued deterioration in the Atlanta housing market and softened demand from buyers, given the deterioration of pricing and valuations. The environment is not getting better. Despite this, our strategy will be the same to recognize and move troubled assets through our process as quickly as possible. We expect to see the challenges continue in the quarters ahead and charge-offs to be elevated over historical levels as we work through our problem credits. But at all times, we will make the best economic decision for our company."
Fee revenue of $10.7 million reflected a decrease of $5.4 million from the fourth quarter of 2007. Service charges and fees on deposit accounts of $7.7 million decreased $608,000 due to lower activity and transaction charges. Consulting fees were down $1.3 million from last year primarily due to the advisory consulting services' assistance in United's corporate-wide initiative to improve profitability and weakness in the financial services industry that affected sales efforts and delayed consulting contracts. The advisory consulting services were performed by a wholly-owned subsidiary and, therefore, eliminated from the consolidated fee revenue. "Late in the fourth quarter, we took an opportunity to lower funding costs by prepaying higher-rate Federal Home Loan Bank advances," stated Tallent. "Securities gains of $838,000 partially offset $2.7 million in charges from the prepayment of the advances." Other fee revenue of $1.4 million declined $684,000 due to lower earnings on bank-owned life insurance assets.
Operating expenses of $52.4 million reflected an increase of $3.1 million from the fourth quarter of 2007. This increase was primarily due to higher foreclosed property costs of $1.4 million and an increase in foreclosure-related professional legal fees of $504,000 and the FDIC increasing insurance premiums by $879,000. Salaries and employee benefit costs of $24.4 million declined $2.7 million from last year due to lower incentive compensation. This decrease was offset by an increase in other expenses of $3.1 million, including a $2.4 million accrual for contested costs on bank-owned life insurance assets and losses on deferred compensation assets of $700,000.
United continues to maintain a very strong capital position, which was bolstered by the completion of the sale on December 5, 2008 of $180 million in preferred stock and warrants to the U.S. Treasury through its Capital Purchase Program. In addition, the company privately placed $13 million of trust preferred securities on October 31, 2008. At December 31, 2008, the company's capital ratios were as follows: Tier I Risk-Based Capital of 11.2 percent; Leverage of 8.3 percent; and Total Risk-Based of 13.9 percent. Also, the average tangible equity-to-assets ratio was 6.6 percent and the average tangible common equity-to-assets ratio was 6.2 percent.
"We remain firmly committed to a strategy of aggressive disposition of problem credits, as we believe moving through this credit cycle as quickly as possible is the best course of action," Tallent said. "Our strong capital position enables us to absorb losses without impairing the company's financial soundness."
"In the coming year, we will be intently focused on working through this credit cycle, improving our margin, growing core deposits and reducing expenses," Tallent concluded.
Conference Call
United Community Banks will hold a conference call today, Friday, January 23, 2009, at 11 a.m. ET to discuss the contents of this news release and to share business highlights for the quarter. The telephone number for the conference call is (877) 723-9518 and the pass code is "UCBI." The conference call will also be available by web cast within the Investor Relations section of the company's web site at www.ucbi.com.
About United Community Banks, Inc.
Headquartered in Blairsville, United Community Banks is the third-largest bank holding company in Georgia. United Community Banks has assets of $8.5 billion and operates 27 community banks with 107 banking offices located throughout north Georgia, the Atlanta region, coastal Georgia, western North Carolina and east Tennessee. The company specializes in providing personalized community banking services to individuals and small to mid-size businesses. United Community Banks also offers the convenience of 24-hour access through a network of ATMs, telephone and on-line banking. United Community Banks common stock is listed on the Nasdaq Global Select Market under the symbol UCBI. Additional information may be found at the company's web site at www.ucbi.com.
Safe Harbor
This news release contains forward-looking statements, as defined by Federal Securities Laws, including statements about financial outlook and business environment. These statements are provided to assist in the understanding of future financial performance and such performance involves risks and uncertainties that may cause actual results to differ materially from those in such statements. Any such statements are based on current expectations and involve a number of risks and uncertainties. For a discussion of some factors that may cause such forward-looking statements to differ materially from actual results, please refer to the section entitled "Forward-Looking Statements" on page 4 of United Community Banks, Inc.'s annual report filed on Form 10-K with the Securities and Exchange Commission.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Selected Financial Information
2008
-------------------------------------
(in thousands, except per share Fourth Third Second
data; taxable equivalent) Quarter Quarter Quarter
----------- ----------- -----------
INCOME SUMMARY
Net interest revenue 51,873 58,791 61,753
Provision for loan losses (1) 85,000 76,000 15,500
Fee revenue 10,718 13,121 15,105
----------- ----------- -----------
Total operating revenue (22,409) (4,088) 61,358
Operating expenses 52,439 56,970 49,761
----------- ----------- -----------
(Loss) income before taxes (74,848) (61,058) 11,597
Income tax expense (benefit) (28,101) (21,184) 4,504
----------- ----------- -----------
Net operating (loss) income (46,747) (39,874) 7,093
Fraud loss provision, net of tax (1) - - -
----------- ----------- -----------
Net (loss) income (46,747) (39,874) 7,093
Preferred stock dividends 712 4 4
----------- ----------- -----------
Net (loss) income available to
common shareholders $ (47,459) $ (39,878) $ 7,089
=========== =========== ===========
OPERATING PERFORMANCE (1)
Earnings (loss) per common share:
Basic $ (.99) $ (.84) $ .15
Diluted (.99) (.84) .15
Return on tangible equity
(2)(3)(4) NM% NM% 5.86%
Return on assets (4) NM NM .34
GAAP PERFORMANCE MEASURES
Per common share:
Basic earnings (loss) $ (.99) $ (.84) $ .15
Diluted earnings (loss) (.99) (.84) .15
Cash dividends declared - - .09
Stock dividends declared .09 .09 -
Book value 16.95 17.12 17.75
Tangible book value (3) 10.39 10.48 11.03
Key performance ratios:
Return on equity (2)(4) NM% NM% 3.41%
Return on assets (2.20) (1.95) .34
Net interest margin (4) 2.70 3.17 3.32
Efficiency ratio 81.34 79.35 65.05
Cash dividend payout ratio - - 60.00
Equity to assets 10.08 10.28 10.33
Tangible equity to assets (3) 6.59 6.65 6.77
Tangible common equity to assets
(3) 6.23 6.65 6.77
ASSET QUALITY
Allowance for loan losses $ 122,271 $ 111,299 $ 91,035
Net charge-offs (1) 74,028 55,736 14,313
Non-performing loans (NPLs) 190,723 139,266 123,786
OREO 59,768 38,438 28,378
----------- ----------- -----------
Total non-performing assets
(NPAs) 250,491 177,704 152,164
Allowance for loan losses to loans
(1) 2.14% 1.91% 1.53%
Net charge-offs to average loans
(1)(4) 5.09 3.77 .97
NPAs to loans and OREO 4.35 3.03 2.55
NPAs to total assets 2.94 2.20 1.84
AVERAGE BALANCES
Loans $ 5,784,139 $ 5,889,168 $ 5,933,143
Investment securities 1,508,808 1,454,740 1,507,240
Earning assets 7,662,536 7,384,287 7,478,018
Total assets 8,449,097 8,146,880 8,295,748
Deposits 6,982,229 6,597,339 6,461,361
Shareholders' equity 851,956 837,487 856,727
Common shares - basic 47,844 47,417 47,158
Common shares - diluted 47,844 47,417 47,249
AT PERIOD END
Loans $ 5,704,861 $ 5,829,937 $ 5,933,141
Investment securities 1,617,187 1,400,827 1,430,588
Total assets 8,520,765 8,072,543 8,264,051
Deposits 7,003,624 6,689,335 6,696,456
Shareholders' equity 989,382 816,880 837,890
Common shares outstanding 48,009 47,596 47,096
(1) Excludes effect of special $15 million fraud related provision for
loan losses recorded in the second quarter of 2007, an additional $3
million provision in the fourth quarter of 2007, and $18 million of
related loan charge-offs recorded in the fourth quarter of 2007 which
were all related to a failed real estate development and are considered
non-recurring. (2) Net income available to common shareholders, which
excludes preferred stock dividends, divided by average realized common
equity, which excludes accumulated other comprehensive income (loss). (3)
Excludes effect of acquisition related intangibles and associated
amortization. (4) Annualized. NM - Not meaningful.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Selected Financial Information
2007 Fourth
----------- ----------- Quarter
(in thousands, except per share First Fourth 2008-2007
data; taxable equivalent) Quarter Quarter Change
----------- ----------- ----------
INCOME SUMMARY
Net interest revenue 66,287 69,730 (26)%
Provision for loan losses (1) 7,500 26,500
Fee revenue 14,197 16,100 (33)
----------- -----------
Total operating revenue 72,984 59,330 (138)
Operating expenses 47,529 49,336 6
----------- -----------
(Loss) income before taxes 25,455 9,994 NM
Income tax expense (benefit) 9,377 3,960
----------- -----------
Net operating (loss) income 16,078 6,034 NM
Fraud loss provision, net of tax (1) - 1,833
----------- -----------
Net (loss) income 16,078 4,201 NM
Preferred stock dividends 4 4
----------- -----------
Net (loss) income available to
common shareholders $ 16,074 $ 4,197 NM
=========== ===========
OPERATING PERFORMANCE (1)
Earnings (loss) per common share:
Basic $ .34 $ .13 NM
Diluted .34 .13 NM
Return on tangible equity
(2)(3)(4) 13.16% 5.06%
Return on assets (4) .78 .29
GAAP PERFORMANCE MEASURES
Per common share:
Basic earnings (loss) $ .34 $ .09 NM
Diluted earnings (loss) .34 .09 NM
Cash dividends declared .09 .09 NM
Stock dividends declared - - NM
Book value 18.50 17.70 (4)
Tangible book value (3) 11.76 10.92 (5)
Key performance ratios:
Return on equity (2)(4) 7.85% 2.01%
Return on assets .78 .20
Net interest margin (4) 3.55 3.73
Efficiency ratio 59.05 57.67
Cash dividend payout ratio 26.47 100.00
Equity to assets 10.30 10.20
Tangible equity to assets (3) 6.73 6.58
Tangible common equity to assets
(3) 6.73 6.58
ASSET QUALITY
Allowance for loan losses $ 89,848 $ 89,423
Net charge-offs (1) 7,075 13,012
Non-performing loans (NPLs) 67,728 28,219
OREO 22,136 18,039
----------- -----------
Total non-performing assets
(NPAs) 89,864 46,258
Allowance for loan losses to loans
(1) 1.51% 1.51%
Net charge-offs to average loans
(1)(4) .48 .87
NPAs to loans and OREO 1.50 .78
NPAs to total assets 1.07 .56
AVERAGE BALANCES
Loans $ 5,958,296 $ 5,940,230 (3)
Investment securities 1,485,515 1,404,796 7
Earning assets 7,491,480 7,424,992 3
Total assets 8,305,621 8,210,120 3
Deposits 6,051,069 6,151,476 14
Shareholders' equity 855,659 837,195 2
Common shares - basic 47,052 47,273
Common shares - diluted 47,272 47,652
AT PERIOD END
Loans $ 5,967,839 $ 5,929,263 (4)
Investment securities 1,508,402 1,356,846 19
Total assets 8,386,255 8,207,302 4
Deposits 6,175,769 6,075,951 15
Shareholders' equity 871,452 831,902 19
Common shares outstanding 47,004 46,903
(1) Excludes effect of special $15 million fraud related provision for
loan losses recorded in the second quarter of 2007, an additional $3
million provision in the fourth quarter of 2007, and $18 million of related
loan charge-offs recorded in the fourth quarter of 2007 which were all
related to a failed real estate development and are considered
non-recurring. (2) Net income available to common shareholders, which
excludes preferred stock dividends, divided by average realized common
equity, which excludes accumulated other comprehensive income (loss). (3)
Excludes effect of acquisition related intangibles and associated
amortization. (4) Annualized. NM - Not meaningful.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Selected Financial Information
For the Twelve
Months Ended YTD
(in thousands, except per share ------------------------- 2008-2007
data; taxable equivalent) 2008 2007 Change
----------- ------------ ---------
INCOME SUMMARY
Net interest revenue 238,704 274,483 (13)%
Provision for loan losses (1) 184,000 37,600
Fee revenue 53,141 62,651 (15)
----------- ------------
Total operating revenue 107,845 299,534 (64)
Operating expenses 206,699 190,061 9
----------- ------------
(Loss) income before taxes (98,854) 109,473 NM
Income tax expense (benefit) (35,404) 40,482
----------- ------------
Net operating (loss) income (63,450) 68,991 NM
Fraud loss provision, net of tax
(1) - 10,998
----------- ------------
Net (loss) income (63,450) 57,993 NM
Preferred stock dividends 724 18
----------- ------------
Net (loss) income available
to common shareholders $ (64,174) $ 57,975 NM
=========== ============
OPERATING PERFORMANCE (1)
Earnings (loss) per common share:
Basic $ (1.35) $ 1.50 NM
Diluted (1.35) 1.48 NM
Return on tangible equity
(2)(3)(4) (12.37)% 14.23%
Return on assets (4) (.76) .89
GAAP PERFORMANCE MEASURES
Per common share:
Basic earnings (loss) $ (1.35) $ 1.26 NM
Diluted earnings (loss) (1.35) 1.24 NM
Cash dividends declared .18 .36 (50)
Stock dividends declared .18 - 100
Book value 16.95 17.70 (4)
Tangible book value (3) 10.39 10.92 (5)
Key performance ratios:
Return on equity (2)(4) (7.82)% 7.79%
Return on assets (.76) .75
Net interest margin (4) 3.18 3.88
Efficiency ratio 70.49 56.53
Cash dividend payout ratio (13.33) 28.57
Equity to assets 10.25 9.61
Tangible equity to assets (3) 6.69 6.63
Tangible common equity to
assets (3) 6.59 6.63
ASSET QUALITY
Allowance for loan losses $ 122,271 $ 89,423
Net charge-offs (1) 151,152 21,834
Non-performing loans (NPLs) 190,723 28,219
OREO 59,768 18,039
----------- ------------
Total non-performing assets
(NPAs) 250,491 46,258
Allowance for loan losses to
loans (1) 2.14 % 1.51%
Net charge-offs to average loans
(1)(4) 2.57 .38
NPAs to loans and OREO 4.35 .78
NPAs to total assets 2.94 .56
AVERAGE BALANCES
Loans $ 5,890,889 $ 5,734,608 3
Investment securities 1,489,036 1,277,935 17
Earning assets 7,504,186 7,070,900 6
Total assets 8,299,330 7,730,530 7
Deposits 6,524,457 6,028,625 8
Shareholders' equity 850,426 742,771 14
Common shares - basic 47,369 45,948
Common shares - diluted 47,369 46,593
AT PERIOD END
Loans $ 5,704,861 $ 5,929,263 (4)
Investment securities 1,617,187 1,356,846 19
Total assets 8,520,765 8,207,302 4
Deposits 7,003,624 6,075,951 15
Shareholders' equity 989,382 831,902 19
Common shares outstanding 48,009 46,903
(1) Excludes effect of special $15 million fraud related provision for
loan losses recorded in the second quarter of 2007, an additional $3
million provision in the fourth quarter of 2007, and $18 million of related
loan charge-offs recorded in the fourth quarter of 2007 which were all
related to a failed real estate development and are considered
non-recurring. (2) Net income available to common shareholders, which
excludes preferred stock dividends, divided by average realized common
equity, which excludes accumulated other comprehensive income (loss). (3)
Excludes effect of acquisition related intangibles and associated
amortization. (4) Annualized. NM - Not meaningful.
UNITED COMMUNITY BANKS, INC.
Selected Financial Information
For the Years Ended December 31,
(in thousands, except
per share data;
taxable equivalent) 2008 2007 2006 2005
---------- ----------- ----------- -----------
INCOME SUMMARY
Net interest revenue 238,704 274,483 237,880 196,799
Provision for loan
losses 184,000 37,600 14,600 12,100
Fee revenue 53,141 62,651 49,095 46,148
---------- ----------- ----------- -----------
Total revenue 107,845 299,534 272,375 230,847
Operating expenses (1) 206,699 190,061 162,070 140,808
---------- ----------- ----------- -----------
(Loss) income
before taxes (98,854) 109,473 110,305 90,039
Income taxes (35,404) 40,482 41,490 33,297
---------- ----------- ----------- -----------
Net operating
(loss) income (63,450) 68,991 68,815 56,742
Fraud loss provision,
net of tax - 10,998 - -
Merger-related charges,
net of tax - - - -
---------- ----------- ----------- -----------
Net (loss) income (63,450) 57,993 68,815 56,742
Preferred stock
dividends 724 18 19 23
---------- ----------- ----------- -----------
Net (loss) income
available to common
shareholders $ (64,174) $ 57,975 $ 68,796 $ 56,719
========== =========== =========== ===========
OPERATING PERFORMANCE (1)
Earnings (loss) per
common share:
Basic $ (1.35) $ 1.50 $ 1.70 $ 1.47
Diluted (1.35) 1.48 1.66 1.43
Return on tangible
equity (2)(3) (12.37)% 14.23% 17.52% 18.99%
Return on assets (.76) .89 1.09 1.04
Efficiency ratio 70.49 56.53 56.35 57.77
Cash dividend payout
ratio (13.33) 24.00 18.82 19.05
GAAP PERFORMANCE
Per common share:
Basic earnings
(loss) $ (1.35) $ 1.26 $ 1.70 $ 1.47
Diluted earnings
(loss) (1.35) 1.24 1.66 1.43
Cash dividends
declared (rounded) .18 .36 .32 .28
Stock dividends
declared .18 - - -
Book value 16.95 17.73 14.37 11.80
Tangible book value
(3) 10.39 10.94 10.57 8.94
Key performance
ratios:
Return on equity
(2) (7.82)% 7.79% 13.28% 13.46%
Return on assets (.76) .75 1.09 1.04
Net interest margin 3.18 3.88 4.05 3.85
Cash dividend
payout ratio (13.33) 28.57 18.82 19.05
Equity to assets 10.25 9.61 8.06 7.63
Tangible equity to
assets (3) 6.69 6.63 6.32 5.64
Tangible common
equity to assets
(3) 6.59 6.63 6.32 5.64
ASSET QUALITY
Allowance for loan
losses $ 122,271 $ 89,423 $ 66,566 $ 53,595
Net charge-offs (1) 151,152 21,834 5,524 5,701
Non-performing loans
(NPLs) 190,723 28,219 12,458 11,997
OREO 59,768 18,039 1,196 998
---------- ----------- ----------- -----------
Total
non-performing
assets (NPAs) 250,491 46,258 13,654 12,995
Allowance for loan
losses to loans (1) 2.14 % 1.51% 1.24% 1.22%
Net charge-offs to
average loans (1) 2.57 .38 .12 .14
NPAs to loans and
OREO 4.35 .78 .25 .30
NPAs to total assets 2.94 .56 .19 .22
AVERAGE BALANCES
Loans $5,890,889 $ 5,734,608 $ 4,800,981 $ 4,061,091
Investment
securities 1,489,036 1,277,935 1,041,897 989,201
Earning assets 7,504,186 7,070,900 5,877,483 5,109,053
Total assets 8,299,330 7,730,530 6,287,148 5,472,200
Deposits 6,524,457 6,028,625 5,017,435 4,003,084
Shareholders' equity 850,426 742,771 506,946 417,309
Common shares -
Basic 47,369 45,948 40,413 38,477
Common shares -
Diluted 47,369 46,593 41,575 39,721
AT YEAR END
Loans $5,704,861 $ 5,929,263 $ 5,376,538 $ 4,398,286
Investment
securities 1,617,187 1,356,846 1,107,153 990,687
Total assets 8,520,765 8,207,302 7,101,249 5,865,756
Deposits 7,003,624 6,075,951 5,772,886 4,477,600
Shareholders' equity 989,382 831,902 616,767 472,686
Common shares
outstanding 48,009 46,903 42,891 40,020
(1) Excludes pre-tax provision for fraud-related loan losses and related
charge-offs of $18 million, or $.24 per diluted common share, recorded in
2007 and pre-tax merger-related charges totaling $.9 million, or $.02 per
diluted common share, recorded in 2004 and $2.1 million, or $.04 per
diluted common share, recorded in 2003. (2) Net income available to
common stockholders, which excludes preferred stock dividends, divided by
average realized common equity which excludes accumulated other
comprehensive income (loss). (3) Excludes effect of acquisition related
intangibles and associated amortization. (4) Compound annual growth rate.
NM - Not meaningful.
UNITED COMMUNITY BANKS, INC.
Selected Financial Information
For the Years Ended December 31,
(in thousands, except per share data; 5 Year
taxable equivalent) 2004 2003 CAGR (4)
----------- ----------- ---------
INCOME SUMMARY
Net interest revenue 152,998 128,089 13%
Provision for loan losses 7,600 6,300
Fee revenue 39,539 38,184 7
----------- -----------
Total revenue 184,937 159,973 (8)
Operating expenses (1) 110,974 97,251 16
----------- -----------
(Loss) income before taxes 73,963 62,722 NM
Income taxes 26,807 23,247
----------- -----------
Net operating (loss) income 47,156 39,475 NM
Fraud loss provision, net of tax - -
Merger-related charges, net of tax 565 1,357
----------- -----------
Net (loss) income 46,591 38,118 NM
Preferred stock dividends 9 66
----------- -----------
Net (loss) income available to
common shareholders $ 46,582 $ 38,052 NM
=========== ===========
OPERATING PERFORMANCE (1)
Earnings (loss) per common share:
Basic $ 1.31 $ 1.15 NM
Diluted 1.27 1.12 NM
Return on tangible equity (2)(3) 19.74% 19.24%
Return on assets 1.07 1.06
Efficiency ratio 57.65 58.39
Cash dividend payout ratio 18.32 17.39
GAAP PERFORMANCE
Per common share:
Basic earnings (loss) $ 1.29 $ 1.11 NM
Diluted earnings (loss) 1.25 1.08 NM
Cash dividends declared (rounded) .24 .20 (2)
Stock dividends declared - - NM
Book value 10.39 8.47 15
Tangible book value (3) 7.34 6.52 10
Key performance ratios:
Return on equity (2) 14.39% 14.79%
Return on assets 1.05 1.02
Net interest margin 3.71 3.68
Cash dividend payout ratio 18.60 18.02
Equity to assets 7.45 7.21
Tangible equity to assets (3) 5.78 6.02
Tangible common equity to assets
(3) 5.78 6.03
ASSET QUALITY
Allowance for loan losses $ 47,196 $ 38,655
Net charge-offs (1) 3,617 4,097
Non-performing loans (NPLs) 8,031 6,627
OREO 694 962
----------- -----------
Total non-performing assets (NPAs) 8,725 7,589
Allowance for loan losses to loans
(1) 1.26% 1.28%
Net charge-offs to average loans (1) .11 .15
NPAs to loans and OREO .23 .25
NPAs to total assets .17 .19
AVERAGE BALANCES
Loans $ 3,322,916 $ 2,753,451 16
Investment securities 734,577 667,211 17
Earning assets 4,119,327 3,476,030 17
Total assets 4,416,835 3,721,284 17
Deposits 3,247,612 2,743,087 19
Shareholders' equity 329,225 268,446 26
Common shares - Basic 36,071 34,132 7
Common shares - Diluted 37,273 35,252 6
AT YEAR END
Loans $ 3,734,905 $ 3,015,997 14
Investment securities 879,978 659,891 20
Total assets 5,087,702 4,068,834 16
Deposits 3,680,516 2,857,449 20
Shareholders' equity 397,088 299,373 27
Common shares outstanding 38,168 35,289 6
(1) Excludes pre-tax provision for fraud-related loan losses and related
charge-offs of $18 million, or $.24 per diluted common share, recorded in
2007 and pre-tax merger-related charges totaling $.9 million, or $.02 per
diluted common share, recorded in 2004 and $2.1 million, or $.04 per
diluted common share, recorded in 2003. (2) Net income available to
common stockholders, which excludes preferred stock dividends, divided by
average realized common equity which excludes accumulated other
comprehensive income (loss). (3) Excludes effect of acquisition related
intangibles and associated amortization. (4) Compound annual growth rate.
NM - Not meaningful.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Loan Portfolio Composition at Period-End
2008
-------------------------------------
Fourth Third Second
(in millions) Quarter Quarter Quarter
----------- ----------- -----------
LOANS BY CATEGORY
Commercial (sec. by RE) $ 1,627 $ 1,604 $ 1,584
Commercial construction 500 509 522
Commercial & industrial 410 425 417
----------- ----------- -----------
Total commercial 2,537 2,538 2,523
Residential construction 1,479 1,596 1,745
Residential mortgage 1,526 1,528 1,494
Consumer / installment 163 168 171
----------- ----------- -----------
Total loans $ 5,705 $ 5,830 $ 5,933
=========== =========== ===========
LOANS BY MARKET
Atlanta MSA $ 1,706 $ 1,800 $ 1,934
Gainesville MSA 420 426 422
North Georgia 2,040 2,066 2,065
Western North Carolina 810 815 819
Coastal Georgia 464 458 436
East Tennessee 265 265 257
----------- ----------- -----------
Total loans $ 5,705 $ 5,830 $ 5,933
=========== =========== ===========
RESIDENTIAL CONSTRUCTION
Dirt loans
Acquisition & development $ 484 $ 516 $ 569
Land loans 153 142 139
Lot loans 358 385 401
----------- ----------- -----------
Total 995 1,043 1,109
----------- ----------- -----------
House loans
Spec 347 393 450
Sold 137 160 186
----------- ----------- -----------
Total 484 553 636
----------- ----------- -----------
Total residential construction $ 1,479 $ 1,596 $ 1,745
=========== =========== ===========
RESIDENTIAL CONSTRUCTION - ATLANTA MSA
Dirt loans
Acquisition & development $ 167 $ 185 $ 232
Land loans 56 47 50
Lot loans 86 103 117
----------- ----------- -----------
Total 309 335 399
----------- ----------- -----------
House loans
Spec 189 227 271
Sold 40 49 58
----------- ----------- -----------
Total 229 276 329
----------- ----------- -----------
Total residential construction $ 538 $ 611 $ 728
=========== =========== ===========
(1) Annualized.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Loan Portfolio Composition at Period-End
2007 Year
--------- --------- Linked over
First Fourth Quarter Year
(in millions) Quarter Quarter Change(1) Change
--------- --------- ------- -------
LOANS BY CATEGORY
Commercial (sec. by RE) $ 1,526 $ 1,476 6 % 10 %
Commercial construction 548 527 (7) (5)
Commercial & industrial 437 418 (14) (2)
--------- ---------
Total commercial 2,511 2,421 - 5
Residential construction 1,791 1,829 (29) (19)
Residential mortgage 1,491 1,502 (1) 2
Consumer / installment 175 177 (12) (8)
--------- ---------
Total loans $ 5,968 $ 5,929 (9) (4)
========= =========
LOANS BY MARKET
Atlanta MSA $ 1,978 $ 2,002 (21)% (15)%
Gainesville MSA 415 400 (6) 5
North Georgia 2,071 2,060 (5) (1)
Western North Carolina 816 806 (2) -
Coastal Georgia 439 416 5 12
East Tennessee 249 245 - 8
--------- ---------
Total loans $ 5,968 $ 5,929 (9) (4)
========= =========
RESIDENTIAL CONSTRUCTION
Dirt loans
Acquisition & development $ 583 $ 592 (25)% (18)%
Land loans 130 126 31 21
Lot loans 406 407 (28) (12)
--------- ---------
Total 1,119 1,125 (18) (12)
--------- ---------
House loans
Spec 460 473 (47)% (27)%
Sold 212 231 (58) (41)
--------- ---------
Total 672 704 (50) (31)
--------- ---------
Total residential construction $ 1,791 $ 1,829 (29) (19)
========= =========
RESIDENTIAL CONSTRUCTION - ATLANTA MSA
Dirt loans
Acquisition & development $ 252 $ 258 (39)% (35)%
Land loans 50 52 77 8
Lot loans 117 117 (66) (26)
--------- ---------
Total 419 427 (31) (28)
--------- ---------
House loans
Spec 271 280 (67)% (33)%
Sold 71 77 (73) (48)
--------- ---------
Total 342 357 (68) (36)
--------- ---------
Total residential construction $ 761 $ 784 (48) (31)
========= =========
(1) Annualized.
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Loan Portfolio Composition at Year-End
(in millions) 2008 2007 2006
----------- ----------- -----------
LOANS BY CATEGORY
Commercial (sec. by RE) $ 1,627 $ 1,476 $ 1,230
Commercial construction 500 527 470
Commercial & industrial 410 418 296
----------- ----------- -----------
Total commercial 2,537 2,421 1,996
Residential construction 1,479 1,829 1,864
Residential mortgage 1,526 1,502 1,338
Consumer / installment 163 177 179
----------- ----------- -----------
Total loans $ 5,705 $ 5,929 $ 5,377
=========== =========== ===========
LOANS BY MARKET
Atlanta MSA $ 1,706 $ 2,002 $ 1,651
Gainesville MSA 420 400 354
North Georgia 2,040 2,060 2,034
Western North Carolina 810 806 773
Coastal Georgia 464 415 358
East Tennessee 265 246 207
----------- ----------- -----------
Total loans $ 5,705 $ 5,929 $ 5,377
=========== =========== ===========
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Loan Portfolio Composition at Year-End
(in millions) 2005 2004 2003
----------- ----------- -----------
LOANS BY CATEGORY
Commercial (sec. by RE) $ 1,055 $ 966 $ 777
Commercial construction 358 239 164
Commercial & industrial 237 212 190
----------- ----------- -----------
Total commercial 1,650 1,417 1,131
Residential construction 1,381 1,066 763
Residential mortgage 1,206 1,102 982
Consumer / installment 161 150 140
----------- ----------- -----------
Total loans $ 4,398 $ 3,735 $ 3,016
=========== =========== ===========
LOANS BY MARKET
Atlanta MSA $ 1,207 $ 1,061 $ 662
Gainesville MSA 249 - -
North Georgia 1,790 1,627 1,481
Western North Carolina 668 633 548
Coastal Georgia 306 274 222
East Tennessee 178 140 103
----------- ----------- -----------
Total loans $ 4,398 $ 3,735 $ 3,016
=========== =========== ===========
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality
Fourth Quarter 2008
-------------------------------------
Nonaccrual Total
(in thousands) Loans OREO NPAs
----------- ----------- -----------
NPAs BY CATEGORY
Commercial (sec. by RE) $ 15,188 $ 2,427 $ 17,615
Commercial construction 1,513 2,333 3,846
Commercial & industrial 1,920 - 1,920
----------- ----------- -----------
Total commercial 18,621 4,760 23,381
Residential construction 144,836 48,572 193,408
Residential mortgage 25,574 6,436 32,010
Consumer / installment 1,692 - 1,692
----------- ----------- -----------
Total NPAs $ 190,723 $ 59,768 $ 250,491
=========== =========== ===========
NPAs BY MARKET
Atlanta MSA $ 105,476 $ 42,336 $ 147,812
Gainesville MSA 16,208 1,110 17,318
North Georgia 31,631 12,785 44,416
Western North Carolina 18,509 2,986 21,495
Coastal Georgia 11,863 138 12,001
East Tennessee 7,036 413 7,449
----------- ----------- -----------
Total NPAs $ 190,723 $ 59,768 $ 250,491
=========== =========== ===========
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality
Third Quarter 2008
-------------------------------------
Nonaccrual Total
(in thousands) Loans OREO NPAs
----------- ----------- -----------
NPAs BY CATEGORY
Commercial (sec. by RE) $ 9,961 $ 854 $ 10,815
Commercial construction 2,924 375 3,299
Commercial & industrial 1,556 - 1,556
----------- ----------- -----------
Total commercial 14,441 1,229 15,670
Residential construction 102,095 32,453 134,548
Residential mortgage 21,335 4,756 26,091
Consumer / installment 1,395 - 1,395
----------- ----------- -----------
Total NPAs $ 139,266 $ 38,438 $ 177,704
=========== =========== ===========
NPAs BY MARKET
Atlanta MSA $ 80,805 $ 27,011 $ 107,816
Gainesville MSA 15,105 648 15,753
North Georgia 20,812 8,337 29,149
Western North Carolina 13,432 1,509 14,941
Coastal Georgia 3,682 601 4,283
East Tennessee 5,430 332 5,762
----------- ----------- -----------
Total NPAs $ 139,266 $ 38,438 $ 177,704
=========== =========== ===========
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality
Second Quarter 2008
-------------------------------------
Nonaccrual Total
(in thousands) Loans OREO NPAs
----------- ----------- -----------
NPAs BY CATEGORY
Commercial (sec. by RE) $ 4,610 $ 593 $ 5,203
Commercial construction 3,027 1,859 4,886
Commercial & industrial 2,950 - 2,950
----------- ----------- -----------
Total commercial 10,587 2,452 13,039
Residential construction 90,283 22,075 112,358
Residential mortgage 21,792 3,851 25,643
Consumer / installment 1,124 - 1,124
----------- ----------- -----------
Total NPAs $ 123,786 $ 28,378 $ 152,164
=========== =========== ===========
NPAs BY MARKET
Atlanta MSA $ 89,327 $ 15,196 $ 104,523
Gainesville MSA 4,885 12 4,897
North Georgia 16,117 8,277 24,394
Western North Carolina 9,838 990 10,828
Coastal Georgia 1,575 3,871 5,446
East Tennessee 2,044 32 2,076
----------- ----------- -----------
Total NPAs $ 123,786 $ 28,378 $ 152,164
=========== =========== ===========
UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality
Fourth Quarter Third Quarter Second Quarter
2008 2008 2008
----------------- ----------------- -----------------
Net Net Net
Charge- Charge- Charge-
Net Offs to Net Offs to Net Offs to
Charge- Average Charge- Average Charge- Average
(in thousands) Offs Loans(1) Offs Loans(1) Offs Loans(1)
-------- ------- -------- ------- -------- -------
NET CHARGE-OFFS BY CATEGORY
Commercial (sec. by
RE) $ 4,460 1.10% $ 257 .06% $ 424 .11%
Commercial
construction 1,442 1.14 225 .17 125 .09
Commercial &
industrial 3,416 3.24 1,018 .96 398 .38
-------- -------- --------
Total commercial 9,318 1.46 1,500 .24 947 .15
Residential
construction 57,882 14.93 50,228 11.94 10,343 2.36
Residential mortgage 5,852 1.52 3,332 .88 2,576 .70
Consumer /
installment 976 2.34 676 1.58 447 1.05
-------- -------- --------
Total $ 74,028 5.09 $ 55,736 3.77 $ 14,313 .97
======== ======== ========
NET CHARGE-OFFS BY MARKET
Atlanta MSA $ 49,309 10.80% $ 48,313 10.08% $ 10,682 2.22%
Gainesville MSA 7,994 8.60 1,470 1.49 360 .34
North Georgia 9,872 1.91 4,567 .88 1,829 .36
Western North
Carolina 2,371 1.16 855 .42 279 .14
Coastal Georgia 3,150 2.70 249 .22 980 .90
East Tennessee 1,332 2.02 282 .43 183 .29
-------- -------- --------
Total $ 74,028 5.09 $ 55,736 3.77 $ 14,313 .97
======== ======== ========
(1) Annualized.
UNITED COMMUNITY BANKS, INC.
Operating Earnings to GAAP Earnings Reconciliation
Presented Only For Periods Where Non-GAAP Earnings Measures Are Shown
(in thousands, except per share data)
2008
------------------------------------
Fourth Third Second
Quarter Quarter Quarter
---------- ---------- ----------
Special provision for fraud related
loan losses $ - $ - $ -
---------- ---------- ----------
Merger-related charges included in
expenses:
Salaries and employee benefits -
severance and related costs - - -
Professional fees - - -
Contract termination costs - - -
Other merger-related expenses - - -
---------- ---------- ----------
Total merger-related
charges - - -
---------- ---------- ----------
Pre-tax earnings impact
of non-operating charges - - -
Income tax effect of special
provision - - -
---------- ---------- ----------
After-tax effect of special
provision $ - $ - $ -
========== ========== ==========
Net Income (Loss) Reconciliation
Operating net income (loss) $ (46,747) $ (39,874) $ 7,093
After-tax effect of special provision
and merger-related charges - - -
---------- ---------- ----------
Net income (loss) (GAAP) $ (46,747) $ (39,874) $ 7,093
========== ========== ==========
Basic Earnings (Loss) Per Share
Reconciliation
Basic operating earnings (loss)
per share $ (.99) $ (.84) $ .15
Per share effect of special provision
and merger-related charges - - -
---------- ---------- ----------
Basic earnings (loss) per share
(GAAP) $ (.99) $ (.84) $ .15
========== ========== ==========
Diluted Earnings (Loss) Per Share
Reconciliation
Diluted operating earnings (loss)
per share $ (.99) $ (.84) $ .15
Per share effect of special provision
and merger-related charges - - -
---------- ---------- ----------
Diluted earnings (loss) per
share (GAAP) $ (.99) $ (.84) $ .15
========== ========== ==========
Provision for Loan Losses
Reconciliation
Operating provision for loan losses $ 85,000 $ 76,000 $ 15,500
Special provision for fraud related
loan losses - - -
---------- ---------- ----------
Provision for loan losses (GAAP) $ 85,000 $ 76,000 $ 15,500
========== ========== ==========
Nonperforming Assets Reconciliation
Nonperforming assets excluding
fraud-related assets $ 247,719 $ 174,227 $ 148,219
Fraud-related loans and OREO included
in nonperforming assets 2,772 3,477 3,945
---------- ---------- ----------
Nonperforming assets (GAAP) $ 250,491 $ 177,704 $ 152,164
========== ========== ==========
Allowance for Loan Losses
Reconciliation
Allowance for loan losses excluding
special fraud-related allowance $ 122,271 $ 111,299 $ 91,035
Fraud-related allowance for loan
losses - - -
---------- ---------- ----------
Allowance for loan losses (GAAP) $ 122,271 $ 111,299 $ 91,035
========== ========== ==========
Net Charge Offs Reconciliation
Net charge offs excluding charge off
of fraud-related loans $ 74,028 $ 55,736 $ 14,313
Fraud-related loans charged off - - -
---------- ---------- ----------
Net charge offs (GAAP) $ 74,028 $ 55,736 $ 14,313
========== ========== ==========
Allowance for Loan Losses to Loans
Ratio Reconciliation
Allowance for loan losses to loans
ratio excluding fraud-related
allowance 2.14% 1.91% 1.53%
Portion of allowance assigned to
fraud-related loans - - -
---------- ---------- ----------
Allowance for loan losses to
loans ratio (GAAP) 2.14% 1.91% 1.53%
========== ========== ==========
Nonperforming Assets to Total Assets
Ratio Reconciliation
Nonperforming assets to total assets
ratio excluding fraud-related assets 2.91% 2.16% 1.79%
Fraud-related nonperforming assets .03 .04 .05
---------- ---------- ----------
Nonperforming assets to total
assets ratio (GAAP) 2.94% 2.20% 1.84%
========== ========== ==========
Net Charge Offs to Average Loans
Ratio Reconciliation
Net charge offs to average loans
ratio excluding fraud-related loans 5.09% 3.77% .97%
Charge offs of fraud-related loans - - -
---------- ---------- ----------
Net charge offs to average loans
ratio (GAAP) 5.09% 3.77% .97%
========== ========== ==========
Operating Expenses Reconciliation
Operating expenses (operating basis) $ 52,439 $ 56,970 $ 47,961
Merger-related charges - - -
---------- ---------- ----------
Operating expenses (GAAP) $ 52,439 $ 56,970 $ 47,961
========== ========== ==========
UNITED COMMUNITY BANKS, INC.
Operating Earnings to GAAP Earnings Reconciliation
Presented Only For Periods Where Non-GAAP Earnings Measures Are Shown
(in thousands, except per share data)
2008 2007
---------- ----------
First Fourth
Quarter Quarter
---------- ----------
Special provision for fraud related loan losses $ - $ 3,000
---------- ----------
Merger-related charges included in expenses:
Salaries and employee benefits - severance
and related costs - -
Professional fees - -
Contract termination costs - -
Other merger-related expenses - -
---------- ----------
Total merger-related charges - -
---------- ----------
Pre-tax earnings impact of
non-operating charges - 3,000
Income tax effect of special provision - 1,167
---------- ----------
After-tax effect of special provision $ - $ 1,833
========== ==========
Net Income (Loss) Reconciliation
Operating net income (loss) $ 16,078 $ 6,034
After-tax effect of special provision and
merger-related charges - (1,833)
---------- ----------
Net income (loss) (GAAP) $ 16,078 $ 4,201
========== ==========
Basic Earnings (Loss) Per Share Reconciliation
Basic operating earnings (loss) per share $ .34 $ .13
Per share effect of special provision and
merger-related charges - (.04)
---------- ----------
Basic earnings (loss) per share (GAAP) $ .34 $ .09
========== ==========
Diluted Earnings (Loss) Per Share Reconciliation
Diluted operating earnings (loss) per share $ .34 $ .13
Per share effect of special provision and
merger-related charges - (.04)
---------- ----------
Diluted earnings (loss) per share (GAAP) $ .34 $ .09
========== ==========
Provision for Loan Losses Reconciliation
Operating provision for loan losses $ 7,500 $ 26,500
Special provision for fraud related loan losses - 3,000
---------- ----------
Provision for loan losses (GAAP) $ 7,500 $ 29,500
========== ==========
Nonperforming Assets Reconciliation
Nonperforming assets excluding fraud-related
assets $ 85,182 $ 40,956
Fraud-related loans and OREO included in
nonperforming assets 4,682 5,302
---------- ----------
Nonperforming assets (GAAP) $ 89,864 $ 46,258
========== ==========
Allowance for Loan Losses Reconciliation
Allowance for loan losses excluding special
fraud-related allowance $ 89,848 $ 89,423
Fraud-related allowance for loan losses - -
---------- ----------
Allowance for loan losses (GAAP) $ 89,848 $ 89,423
========== ==========
Net Charge Offs Reconciliation
Net charge offs excluding charge off of
fraud-related loans $ 7,075 $ 13,012
Fraud-related loans charged off - 18,000
---------- ----------
Net charge offs (GAAP) $ 7,075 $ 31,012
========== ==========
Allowance for Loan Losses to Loans Ratio
Reconciliation
Allowance for loan losses to loans ratio excluding
fraud-related allowance 1.51% 1.51%
Portion of allowance assigned to fraud-related
loans - -
---------- ----------
Allowance for loan losses to loans ratio (GAAP) 1.51% 1.51%
========== ==========
Nonperforming Assets to Total Assets Ratio
Reconciliation
Nonperforming assets to total assets ratio
excluding fraud-related assets 1.02% .50%
Fraud-related nonperforming assets .05 .06
---------- ----------
Nonperforming assets to total assets ratio
(GAAP) 1.07% .56%
========== ==========
Net Charge Offs to Average Loans Ratio
Reconciliation
Net charge offs to average loans ratio excluding
fraud-related loans .48% .87%
Charge offs of fraud-related loans - 1.20
---------- ----------
Net charge offs to average loans ratio (GAAP) .48% 2.07%
========== ==========
Operating Expenses Reconciliation
Operating expenses (operating basis) $ 47,529 $ 49,336
Merger-related charges - -
---------- ----------
Operating expenses (GAAP) $ 47,529 $ 49,336
========== ==========
UNITED COMMUNITY BANKS, INC.
Operating Earnings to GAAP Earnings Reconciliation
Presented Only For Periods Where Non-GAAP Earnings Measures Are Shown
(in thousands, except per share data)
Years Ended December 31,
------------------------------------------
2008 2007 2004 2003
--------- --------- --------- ---------
Special provision for fraud
related loan losses $ - $ 18,000 $ - $ -
--------- --------- --------- ---------
Merger-related charges included
in expenses:
Salaries and employee
benefits - severance and
related costs - - 203 135
Professional fees - - 407 885
Contract termination costs - - 119 566
Other merger-related
expenses - - 141 502
--------- --------- --------- ---------
Total merger-related
charges - - 870 2,088
--------- --------- --------- ---------
Pre-tax earnings
impact of
non-operating
charges - 18,000 870 2,088
Income tax effect of special
provision - 7,002 305 731
--------- --------- --------- ---------
After-tax effect of
special provision $ - $ 10,998 $ 565 $ 1,357
========= ========= ========= =========
Net Income (Loss)
Reconciliation
Operating net income (loss) $ (63,450) $ 68,991 $ 47,156 $ 39,475
After-tax effect of special
provision and merger-related
charges - (10,998) (119) (566)
--------- --------- --------- ---------
Net income (loss) (GAAP) $ (63,450) $ 57,993 $ 47,037 $ 38,909
========= ========= ========= =========
Basic Earnings (Loss) Per Share
Reconciliation
Basic operating earnings (loss)
per share $ (1.35) $ 1.50 $ 1.31 $ 1.15
Per share effect of special
provision and merger-related
charges - (.24) (.02) (.04)
--------- --------- --------- ---------
Basic earnings (loss) per
share (GAAP) $ (1.35) $ 1.26 $ 1.29 $ 1.11
========= ========= ========= =========
Diluted Earnings (Loss) Per
Share Reconciliation
Diluted operating earnings
(loss) per share $ (1.35) $ 1.48 $ 1.27 $ 1.12
Per share effect of special
provision and merger-related
charges - (.24) (.02) (.04)
--------- --------- --------- ---------
Diluted earnings (loss)
per share (GAAP) $ (1.35) $ 1.24 $ 1.25 $ 1.08
========= ========= ========= =========
Provision for Loan Losses
Reconciliation
Operating provision for loan
losses $ 184,000 $ 37,600 $ 7,600 $ 6,300
Special provision for fraud
related loan losses - 18,000 - -
--------- --------- --------- ---------
Provision for loan losses
(GAAP) $ 184,000 $ 55,600 $ 7,600 $ 6,300
========= ========= ========= =========
Nonperforming Assets
Reconciliation
Nonperforming assets excluding
fraud-related assets $ 247,719 $ 40,956 $ 8,725 $ 7,589
Fraud-related loans and OREO
included in nonperforming
assets 2,772 5,302 - -
--------- --------- --------- ---------
Nonperforming assets
(GAAP) $ 250,491 $ 46,258 $ 8,725 $ 7,589
========= ========= ========= =========
Allowance for Loan Losses
Reconciliation
Allowance for loan losses
excluding special
fraud-related allowance $ 122,271 $ 89,423 $ 47,196 $ 38,655
Fraud-related allowance for
loan losses - - - -
--------- --------- --------- ---------
Allowance for loan losses
(GAAP) $ 122,271 $ 89,423 $ 47,196 $ 38,655
========= ========= ========= =========
Net Charge Offs Reconciliation
Net charge offs excluding
charge off of fraud-related
loans $ 151,152 $ 21,834 $ 3,617 $ 4,097
Fraud-related loans charged off - 18,000 - -
--------- --------- --------- ---------
Net charge offs (GAAP) $ 151,152 $ 39,834 $ 3,617 $ 4,097
========= ========= ========= =========
Allowance for Loan Losses to
Loans Ratio Reconciliation
Allowance for loan losses to
loans ratio excluding
fraud-related allowance 2.14% 1.51% 1.26% 1.28%
Portion of allowance assigned
to fraud-related loans - - - -
--------- --------- --------- ---------
Allowance for loan losses
to loans ratio (GAAP) 2.14% 1.51% 1.26% 1.28%
========= ========= ========= =========
Nonperforming Assets to Total
Assets Ratio Reconciliation
Nonperforming assets to total
assets ratio excluding
fraud-related assets 2.91% .50% .17% .19%
Fraud-related nonperforming
assets .03 .06 - -
--------- --------- --------- ---------
Nonperforming assets to
total assets ratio (GAAP) 2.94% .56% .17% .19%
========= ========= ========= =========
Net Charge Offs to Average
Loans Ratio Reconciliation
Net charge offs to average
loans ratio excluding
fraud-related loans 2.57% .38% .11% .15%
Charge offs of fraud-related
loans - .31 - -
--------- --------- --------- ---------
Net charge offs to average
loans ratio (GAAP) 2.57% .69% .11% .15%
========= ========= ========= =========
Operating Expenses
Reconciliation
Operating expenses (operating
basis) $ 206,699 $ 190,061 $ 110,974 $ 97,251
Merger-related charges - - 870 2,088
--------- --------- --------- ---------
Operating expenses (GAAP) $ 206,699 $ 190,061 $ 111,844 $ 99,339
========= ========= ========= =========
UNITED COMMUNITY BANKS, INC.
Consolidated Statement of Income (Unaudited)
Three Months Ended
December 31,
-----------------------
(in thousands, except per share data) 2008 2007
---------- ----------
Interest revenue:
Loans, including fees $ 86,409 $ 121,248
Investment securities:
Taxable 18,640 18,296
Tax exempt 324 405
Federal funds sold, commercial paper and
deposits in banks 2,508 336
---------- ----------
Total interest revenue 107,881 140,285
---------- ----------
Interest expense:
Deposits:
NOW 6,045 10,999
Money market 3,124 4,314
Savings 204 417
Time 41,512 40,934
---------- ----------
Total deposit interest expense 50,885 56,664
Federal funds purchased, repurchase agreements
and other short-term borrowings 445 6,010
Federal Home Loan Bank advances 2,358 6,275
Long-term debt 2,873 2,089
---------- ----------
Total interest expense 56,561 71,038
---------- ----------
Net interest revenue 51,320 69,247
Provision for loan losses 85,000 29,500
---------- ----------
Net interest (loss) revenue after provision
for loan losses (33,680) 39,747
---------- ----------
Fee revenue:
Service charges and fees 7,742 8,350
Mortgage loan and other related fees 1,528 1,720
Consulting fees 1,260 2,577
Brokerage fees 645 1,064
Securities gains, net 838 1,364
Losses on prepayment of borrowings (2,714) (1,078)
Other 1,419 2,103
---------- ----------
Total fee revenue 10,718 16,100
---------- ----------
Total revenue (22,962) 55,847
---------- ----------
Operating expenses:
Salaries and employee benefits 24,441 27,116
Communications and equipment 3,897 3,890
Occupancy 3,663 3,489
Advertising and public relations 1,358 1,873
Postage, printing and supplies 1,763 1,546
Professional fees 2,313 1,809
Foreclosed property 5,238 3,850
FDIC assessments and other regulatory charges 1,980 1,101
Amortization of intangibles 745 771
Other 7,041 3,891
---------- ----------
Total operating expenses 52,439 49,336
---------- ----------
(Loss) income before income taxes (75,401) 6,511
Income tax (benefit) expense (28,654) 2,310
---------- ----------
Net (loss) income (46,747) 4,201
Preferred stock dividends 712 4
---------- ----------
Net (loss) income available to common
shareholders $ (47,459) $ 4,197
========== ==========
(Loss) earnings per common share:
Basic $ (.99) $ .09
Diluted (.99) .09
Cash dividends per common share .00 .09
Stock dividends per common share .09 .00
Weighted average common shares outstanding:
Basic 47,844 47,273
Diluted 47,844 47,652
UNITED COMMUNITY BANKS, INC.
Consolidated Statement of Income (Unaudited)
Twelve Months Ended
December 31,
-----------------------
(in thousands, except per share data) 2008 2007
---------- ----------
Interest revenue:
Loans, including fees $ 385,959 $ 482,333
Investment securities:
Taxable 74,405 64,377
Tax exempt 1,464 1,718
Federal funds sold, commercial paper and deposits
in banks 2,880 608
---------- ----------
Total interest revenue 464,708 549,036
---------- ----------
Interest expense:
Deposits:
NOW 28,626 45,142
Money market 10,643 15,396
Savings 764 1,653
Time 158,268 167,400
---------- ----------
Total deposit interest expense 198,301 229,591
Federal funds purchased, repurchase agreements
and other short-term borrowings 7,699 16,236
Federal Home Loan Bank advances 13,026 22,013
Long-term debt 9,239 8,594
---------- ----------
Total interest expense 228,265 276,434
---------- ----------
Net interest revenue 236,443 272,602
Provision for loan losses 184,000 55,600
---------- ----------
Net interest (loss) revenue after provision
for loan losses 52,443 217,002
---------- ----------
Fee revenue:
Service charges and fees 31,683 31,433
Mortgage loan and other related fees 7,103 8,537
Consulting fees 7,046 8,946
Brokerage fees 3,457 4,095
Securities gains, net 1,315 3,182
Losses on prepayment of borrowings (2,714) (2,242)
Other 5,251 8,700
---------- ----------
Total fee revenue 53,141 62,651
---------- ----------
Total revenue 105,584 279,653
---------- ----------
Operating expenses:
Salaries and employee benefits 110,574 115,153
Communications and equipment 15,490 15,483
Occupancy 14,988 13,613
Advertising and public relations 6,117 7,524
Postage, printing and supplies 6,296 6,365
Professional fees 7,509 7,218
Foreclosed property 19,110 4,980
FDIC assessments and other regulatory charges 6,020 2,780
Amortization of intangibles 3,009 2,739
Other 17,586 14,206
---------- ----------
Total operating expenses 206,699 190,061
---------- ----------
(Loss) income before income taxes (101,115) 89,592
Income tax (benefit) expense (37,665) 31,599
---------- ----------
Net (loss) income (63,450) 57,993
Preferred stock dividends 724 18
---------- ----------
Net (loss) income available to common
shareholders $ (64,174) $ 57,975
========== ==========
(Loss) earnings per common share:
Basic $ (1.35) $ 1.26
Diluted (1.35) 1.24
Cash dividends per common share .18 .36
Stock dividends per common share .18 .00
Weighted average common shares outstanding:
Basic 47,369 45,948
Diluted 47,369 46,593
UNITED COMMUNITY BANKS, INC.
Consolidated Balance Sheet
December 31, December 31,
(in thousands, except share and per share data) 2008 2007
----------- -----------
(unaudited) (unaudited)
ASSETS
Cash and due from banks $ 116,395 $ 157,549
Interest-bearing deposits in banks 8,417 62,074
Federal funds sold, commercial paper and
short-term investments 368,609 -
----------- -----------
Cash and cash equivalents 493,421 219,623
Securities available for sale 1,617,187 1,356,846
Mortgage loans held for sale 20,334 28,004
Loans, net of unearned income 5,704,861 5,929,263
Less allowance for loan losses 122,271 89,423
----------- -----------
Loans, net 5,582,590 5,839,840
Premises and equipment, net 179,160 180,088
Accrued interest receivable 46,088 62,828
Goodwill and other intangible assets 321,798 325,305
Other assets 260,187 194,768
----------- -----------
Total assets $ 8,520,765 $ 8,207,302
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Deposits:
Demand $ 654,036 $ 700,941
NOW 1,543,385 1,474,818
Money market 466,750 452,917
Savings 170,275 186,392
Time:
Less than $100,000 1,953,235 1,573,604
Greater than $100,000 1,422,974 1,364,763
Brokered 792,969 322,516
----------- -----------
Total deposits 7,003,624 6,075,951
Federal funds purchased, repurchase
agreements, and other short-term borrowings 108,411 638,462
Federal Home Loan Bank advances 235,321 519,782
Long-term debt 150,986 107,996
Accrued expenses and other liabilities 33,041 33,209
----------- -----------
Total liabilities 7,531,383 7,375,400
----------- -----------
Shareholders' equity:
Preferred stock, $1 par value; 10,000,000
shares authorized;
Series A; $10 stated value; 25,800 and
25,800 shares issued
and outstanding 258 258
Series B; $1,000 stated value; 180,000
shares issued and outstanding
at December 31, 2008 173,180 -
Common stock, $1 par value; 100,000,000
shares authorized;
48,809,301 and 48,809,301 shares issued 48,809 48,809
Common stock issuable; 129,304 and 73,250
shares 2,908 2,100
Capital surplus 460,708 462,881
Retained earnings 265,405 347,391
Treasury stock; 799,892 and 1,905,921
shares, at cost (16,465) (43,798)
Accumulated other comprehensive income 54,579 14,261
----------- -----------
Total shareholders' equity 989,382 831,902
----------- -----------
Total liabilities and shareholders'
equity $ 8,520,765 $ 8,207,302
=========== ===========
UNITED COMMUNITY BANKS, INC.
Average Consolidated Balance Sheets and Net Interest Analysis
For the Three Months Ended December 31,
2008
----------- ------------ -----------
(dollars in thousands, taxable Average Avg.
equivalent) Balance Interest Rate
----------- ------------ -----------
Assets:
Interest-earning assets:
Loans, net of unearned income
(1)(2) $ 5,784,139 $ 86,530 5.95%
Taxable securities (3) 1,478,427 18,640 5.04
Tax-exempt securities (1)(3) 30,381 530 6.98
Federal funds sold and other
interest-earning assets 369,589 2,734 2.96
----------- ------------
Total interest-earning assets 7,662,536 108,434 5.64
----------- ------------
Non-interest-earning assets:
Allowance for loan losses (109,956)
Cash and due from banks 116,463
Premises and equipment 179,807
Other assets (3) 600,247
-----------
Total assets $ 8,449,097
===========
Liabilities and Shareholders'
Equity:
Interest-bearing liabilities:
Interest-bearing deposits:
NOW $ 1,534,370 $ 6,045 1.57
Money market 424,940 3,124 2.92
Savings 174,186 204 .47
Time less than $100,000 1,916,811 18,524 3.84
Time greater than $100,000 1,448,818 14,558 4.00
Brokered 818,100 8,430 4.10
----------- ------------
Total interest-bearing
deposits 6,317,225 50,885 3.20
----------- ------------
Federal funds purchased and other
borrowings 109,712 445 1.61
Federal Home Loan Bank advances 284,860 2,358 3.29
Long-term debt 146,746 2,873 7.79
----------- ------------
Total borrowed funds 541,318 5,676 4.17
----------- ------------
Total interest-bearing
liabilities 6,858,543 56,561 3.28
------------
Non-interest-bearing liabilities:
Non-interest-bearing deposits 665,004
Other liabilities 73,594
-----------
Total liabilities 7,597,141
Shareholders' equity 851,956
-----------
Total liabilities and
shareholders' equity $ 8,449,097
===========
Net interest revenue $ 51,873
============
Net interest-rate spread 2.36%
===========
Net interest margin (4) 2.70%
===========
(1) Interest revenue on tax-exempt securities and loans has been increased
to reflect comparable interest on taxable securities and loans. The rate
used was 39%, reflecting the statutory federal income tax rate and the
federal tax adjusted state income tax rate.
(2) Included in the average balance of loans outstanding are loans where
the accrual of interest has been discontinued.
(3) Securities available for sale are shown at amortized cost. Pretax
unrealized losses of $3.6 million in 2008 and $799 thousand in 2007 are
included in other assets for purposes of this presentation.
(4) Net interest margin is taxable equivalent net-interest revenue divided
by average interest-earning assets.
UNITED COMMUNITY BANKS, INC.
Average Consolidated Balance Sheets and Net Interest Analysis
For the Three Months Ended December 31,
2007
----------- ------------ -----------
(dollars in thousands, taxable Average Avg.
equivalent) Balance Interest Rate
----------- ------------ -----------
Assets:
Interest-earning assets:
Loans, net of unearned income
(1)(2) $ 5,940,230 $ 121,161 8.09%
Taxable securities (3) 1,366,507 18,296 5.36
Tax-exempt securities (1)(3) 38,289 666 6.96
Federal funds sold and other
interest-earning assets 79,966 645 3.23
----------- ------------
Total interest-earning assets 7,424,992 140,768 7.53
----------- ------------
Non-interest-earning assets:
Allowance for loan losses (89,797)
Cash and due from banks 147,500
Premises and equipment 177,445
Other assets (3) 549,980
-----------
Total assets $ 8,210,120
===========
Liabilities and Shareholders'
Equity:
Interest-bearing liabilities:
Interest-bearing deposits:
NOW $ 1,491,091 $ 10,999 2.93
Money market 483,289 4,314 3.54
Savings 191,133 417 .87
Time less than $100,000 1,583,989 19,392 4.86
Time greater than $100,000 1,362,812 17,467 5.08
Brokered 322,963 4,075 5.01
----------- ------------
Total interest-bearing
deposits 5,435,277 56,664 4.14
----------- ------------
Federal funds purchased and other
borrowings 466,408 6,010 5.11
Federal Home Loan Bank advances 531,196 6,275 4.69
Long-term debt 143,814 2,089 5.76
----------- ------------
Total borrowed funds 1,141,418 14,374 5.00
----------- ------------
Total interest-bearing
liabilities 6,576,695 71,038 4.29
------------
Non-interest-bearing liabilities:
Non-interest-bearing deposits 716,199
Other liabilities 80,031
-----------
Total liabilities 7,372,925
Shareholders' equity 837,195
-----------
Total liabilities and
shareholders' equity $ 8,210,120
===========
Net interest revenue $ 69,730
============
Net interest-rate spread 3.24%
===========
Net interest margin (4) 3.73%
===========
(1) Interest revenue on tax-exempt securities and loans has been increased
to reflect comparable interest on taxable securities and loans. The rate
used was 39%, reflecting the statutory federal income tax rate and
the federal tax adjusted state income tax rate.
(2) Included in the average balance of loans outstanding are loans where
the accrual of interest has been discontinued.
(3) Securities available for sale are shown at amortized cost. Pretax
unrealized losses of $3.6 million in 2008 and $799 thousand in 2007 are
included in other assets for purposes of this presentation.
(4) Net interest margin is taxable equivalent net-interest revenue divided
by average interest-earning assets.
UNITED COMMUNITY BANKS, INC.
Average Consolidated Balance Sheets and Net Interest Analysis
For the Twelve Months Ended December 31,
2008
----------- ------------ -----------
(dollars in thousands, taxable Average Avg.
equivalent) Balance Interest Rate
----------- ------------ -----------
Assets:
Interest-earning assets:
Loans, net of unearned income
(1)(2) $ 5,890,889 $ 386,132 6.55%
Taxable securities (3) 1,455,206 74,405 5.11
Tax-exempt securities (1)(3) 33,830 2,406 7.11
Federal funds sold and other
interest-earning assets 124,261 4,026 3.24
----------- ------------
Total interest-earning assets 7,504,186 466,969 6.22
----------- ------------
Non-interest-earning assets:
Allowance for loan losses (97,385)
Cash and due from banks 131,778
Premises and equipment 180,857
Other assets (3) 579,894
-----------
Total assets $ 8,299,330
===========
Liabilities and Shareholders'
Equity:
Interest-bearing liabilities:
Interest-bearing deposits:
NOW $ 1,491,419 $ 28,626 1.92
Money market 426,988 10,643 2.49
Savings 182,067 764 .42
Time less than $100,000 1,724,036 71,844 4.17
Time greater than $100,000 1,457,397 62,888 4.32
Brokered 565,111 23,536 4.16
----------- ------------
Total interest-bearing
deposits 5,847,018 198,301 3.39
----------- ------------
Federal funds purchased and other
borrowings 324,634 7,699 2.37
Federal Home Loan Bank advances 410,605 13,026 3.17
Long-term debt 120,442 9,239 7.67
----------- ------------
Total borrowed funds 855,681 29,964 3.50
----------- ------------
Total interest-bearing
liabilities 6,702,699 228,265 3.41
------------
Non-interest-bearing liabilities:
Non-interest-bearing deposits 677,439
Other liabilities 68,766
-----------
Total liabilities 7,448,904
Shareholders' equity 850,426
-----------
Total liabilities and
shareholders' equity $ 8,299,330
===========
Net interest revenue $ 238,704
============
Net interest-rate spread 2.81%
===========
Net interest margin (4) 3.18%
===========
(1) Interest revenue on tax-exempt securities and loans has been increased
to reflect comparable interest on taxable securities and loans. The rate
used was 39%, reflecting the statutory federal income tax rate and
the federal tax adjusted state income tax rate.
(2) Included in the average balance of loans outstanding are loans where
the accrual of interest has been discontinued.
(3) Securities available for sale are shown at amortized cost. Pretax
unrealized gains of $3.3 million in 2008 and pretax unrealized losses of
$8.1 million in 2007 are included in other assets for purposes of this
presentation.
(4) Net interest margin is taxable equivalent net-interest revenue divided
by average interest-earning assets.
UNITED COMMUNITY BANKS, INC.
Average Consolidated Balance Sheets and Net Interest Analysis
For the Twelve Months Ended December 31,
2007
----------- ------------ -----------
(dollars in thousands, taxable Average Avg.
equivalent) Balance Interest Rate
----------- ------------ -----------
Assets:
Interest-earning assets:
Loans, net of unearned income
(1)(2) $ 5,734,608 $ 481,590 8.40%
Taxable securities (3) 1,236,595 64,377 5.21
Tax-exempt securities (1)(3) 41,340 2,826 6.84
Federal funds sold and other
interest-earning assets 58,357 2,124 3.64
----------- ------------
Total interest-earning assets 7,070,900 550,917 7.79
----------- ------------
Non-interest-earning assets:
Allowance for loan losses (81,378)
Cash and due from banks 135,021
Premises and equipment 164,153
Other assets (3) 441,834
-----------
Total assets $ 7,730,530
===========
Liabilities and Shareholders'
Equity:
Interest-bearing liabilities:
Interest-bearing deposits:
NOW $ 1,406,655 $ 45,142 3.21
Money market 399,838 15,396 3.85
Savings 188,560 1,653 .88
Time less than $100,000 1,619,332 79,317 4.90
Time greater than $100,000 1,377,915 71,467 5.19
Brokered 337,323 16,616 4.93
----------- ------------
Total interest-bearing
deposits 5,329,623 229,591 4.31
----------- ------------
Federal funds purchased and other
borrowings 308,372 16,236 5.27
Federal Home Loan Bank advances 455,620 22,013 4.83
Long-term debt 122,555 8,594 7.01
----------- ------------
Total borrowed funds 886,547 46,843 5.28
----------- ------------
Total interest-bearing
liabilities 6,216,170 276,434 4.45
------------
Non-interest-bearing liabilities:
Non-interest-bearing deposits 699,002
Other liabilities 72,587
-----------
Total liabilities 6,987,759
Shareholders' equity 742,771
-----------
Total liabilities and
shareholders' equity $ 7,730,530
===========
Net interest revenue $ 274,483
============
Net interest-rate spread 3.34%
===========
Net interest margin (4) 3.88%
===========
(1) Interest revenue on tax-exempt securities and loans has been increased
to reflect comparable interest on taxable securities and loans. The rate
used was 39%, reflecting the statutory federal income tax rate and
the federal tax adjusted state income tax rate.
(2) Included in the average balance of loans outstanding are loans where
the accrual of interest has been discontinued.
(3) Securities available for sale are shown at amortized cost. Pretax
unrealized gains of $3.3 million in 2008 and pretax unrealized losses of
$8.1 million in 2007 are included in other assets for purposes of this
presentation.
(4) Net interest margin is taxable equivalent net-interest revenue divided
by average interest-earning assets.
For more information: Rex S. Schuette Chief Financial Officer (706) 781-2266 Email Contact
SOURCE: United Community Banks, Inc.
http://www2.marketwire.com/mw/emailprcntct?id=8D96D2E10F13ADAB
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