Press Release Details

EPS of $0.78, Return on Assets of 1.46% and Return on Common Equity of 14.1%

GREENVILLE, S.C., July 20, 2021 (GLOBE NEWSWIRE) -- United Community Banks, Inc. (NASDAQ: UCBI) (United) today announced that net income for the second quarter was $70.3 million and pre-tax, pre-provision income was $78.7 million. Diluted earnings per share of $0.78 for the quarter represented an increase of $0.46 or 144%, from the second quarter a year ago, and represented a decrease of $0.04 or 5% from the first quarter of 2021. On an operating basis, United’s diluted earnings per share of $0.79 was up 147% over the year ago quarter. United’s GAAP return on assets (ROA) was 1.46% and its return on common equity was 14.1% for the quarter. On an operating basis, United’s ROA was 1.48% and its return on tangible common equity was 17.8%. On a pre-tax, pre-provision basis, operating return on assets was 1.67% for the quarter. The quarter benefited from an allowance release of $13.6 million, reflecting continued improvement in economic conditions and forecasts in United’s markets.

Chairman and CEO Lynn Harton stated, “This has been an outstanding quarter for United. Our team once again was recognized by JD Power as having the Best Retail Customer Satisfaction in the Southeast. On July 6, we closed on the acquisition of FinTrust, accelerating our wealth management strategy. We announced expansion into two of the strongest markets in the Southeast, Charlotte and Nashville, via agreements to acquire outstanding community banks in those markets. In addition to these strategic accomplishments, our bankers continued to deliver strong performance results. Core loan growth, excluding PPP loans, was solid and we continue to be optimistic about the remainder of the year, given the momentum in our markets. Core deposit growth remains very strong. Credit results were excellent as well. I couldn’t be more proud of the United team and I congratulate them for delivering these tremendous results.”

Total loans decreased by $288 million during the quarter—impacted by $411 million of Paycheck Protection Program (PPP) loan forgiveness. Excluding the effect of PPP loans, core organic loan growth was 5% annualized. Core transaction deposits grew by $432 million during the quarter, or 14% annualized, and United’s cost of deposits decreased by 5 basis points to 0.09%. The net interest margin decreased by 3 basis points from the first quarter due mainly to a change in the earning asset mix.

Second Quarter 2021 Financial Highlights:

• Net income of $70.3 million and pre-tax, pre-provision income of $78.7 million
• EPS increased by 144% compared to second quarter 2020 on a GAAP basis and 147% on an operating basis; compared to first quarter 2021, EPS decreased by 5% on both a GAAP and operating basis
• Return on assets of 1.46%, or 1.48% on an operating basis
• Pre-tax, pre-provision return on assets of 1.64%, or 1.67% on an operating basis
• Return on common equity of 14.1%
• Return on tangible common equity of 17.8% on an operating basis
• A release of provision for credit losses of $13.6 million, which reduced the allowance for loan losses to 0.98% of loans (1.02%, excluding PPP loans) from 1.09% in the first quarter
• Loan production of $1.3 billion, resulting in core loan growth of 5%, annualized for the quarter, excluding the impact of $411 million in PPP loans being forgiven
• Core transaction deposits were up $432 million, which represents a 14% annualized growth rate for the quarter
• Net interest margin of 3.19% was down 3 basis points from the first quarter, due to continued strong deposit growth and an earning asset mix change toward securities
• Record mortgage closings of $680 million compared to $563 million a year ago; mortgage rate locks of $702 million compared to $802 million a year ago
• Noninterest income was down $8.9 million on a linked quarter basis, primarily driven by slowing mortgage rate lock activity
• Noninterest expenses increased by $346,000 compared to the first quarter on a GAAP basis and by $811,000 on an operating basis mostly due to increased professional fees and mortgage commissions
• Efficiency ratio of 54.5%, or 53.9% on an operating basis
• Net recoveries of $456,000 or 2 basis points as a percent of average loans, down 1 basis point from the first quarter
• Nonperforming assets of 0.25% of total assets, down 5 basis points compared to March 31, 2021
• Total loan deferrals of $18 million or 0.2% of the total loan portfolio compared to $48 million or 0.4% in the first quarter
• Quarterly common shareholder dividend of $0.19 per share declared during the quarter, an increase of 6% year-over-year
• Announced the acquisition of FinTrust Capital Partners, LLC, a registered investment adviser, which closed on July 6, 2021; it added $2.1 billion in assets under management and is expected to add $0.02 in EPS accretion in 2022
• Announced the acquisition of Aquesta Financial Holdings, Inc. with $752 million in assets on May 27; it is expected to close in the fourth quarter of 2021 and add $0.08 in EPS accretion in 2022 with cost savings fully phased in
• Announced the acquisition of Reliant Bancorp, Inc. with $3.1 billion in assets on July 14; it is expected to close in the first quarter of 2022 and add $0.15 in EPS accretion in 2022 and $0.22 in 2023 with cost savings fully phased in
  

Conference Call

United will hold a conference call on Wednesday, July 21, 2021, at 11 a.m. ET to discuss the contents of this press release and to share business highlights for the quarter. To access the call, dial (877) 380-5665 and use the conference number 9585551. The conference call also will be webcast and available for replay for 30 days by selecting “Events & Presentations” within the Investor Relations section of United’s website at www.ucbi.com.

UNITED COMMUNITY BANKS, INC.
Selected Financial Information
		2021										2020															Second Quarter				For the Six Months Ended June 30,										YTD 2021 -
(in thousands, except per share data)		Second Quarter					First Quarter					Fourth Quarter					Third Quarter					Second Quarter					2021 - 2020 Change				2021					2020					2020 Change
INCOME SUMMARY
Interest revenue		$	145,809				$	141,542				$	156,071				$	141,773				$	123,605								$	287,351				$	260,152
Interest expense		7,433					9,478					10,676					13,319					14,301									16,911					32,242
Net interest revenue		138,376					132,064					145,395					128,454					109,304					27		%		270,440					227,910					19		%
(Release of) provision for credit losses		(13,588		)			(12,281		)			2,907					21,793					33,543									(25,869		)			55,734
Noninterest income		35,841					44,705					41,375					48,682					40,238					(11	)			80,546					66,052					22
Total revenue		187,805					189,050					183,863					155,343					115,999					62				376,855					238,228					58
Expenses		95,540					95,194					106,490					95,981					83,980					14				190,734					165,518					15
Income before income tax expense		92,265					93,856					77,373					59,362					32,019					188				186,121					72,710					156
Income tax expense		22,005					20,150					17,871					11,755					6,923					218				42,155					15,730					168
Net income		70,260					73,706					59,502					47,607					25,096					180				143,966					56,980					153
Merger-related and other charges		1,078					1,543					2,452					3,361					397									2,621					1,205
Income tax benefit of merger-related and other charges		(246		)			(335		)			(552		)			(519		)			(87		)							(581		)			(269		)
Net income - operating (1)		$	71,092				$	74,914				$	61,402				$	50,449				$	25,406				180				$	146,006				$	57,916				152
Pre-tax pre-provision income (5)		$	78,677				$	81,575				$	80,280				$	81,155				$	65,562				20				$	160,252				$	128,444				25
PERFORMANCE MEASURES
Per common share:
Diluted net income - GAAP		$	0.78				$	0.82				$	0.66				$	0.52				$	0.32				144				$	1.60				$	0.71				125
Diluted net income - operating (1)		0.79					0.83					0.68					0.55					0.32					147				1.62					0.73					122
Cash dividends declared		0.19					0.19					0.18					0.18					0.18					6				0.38					0.36					6
Book value		22.81					22.15					21.90					21.45					21.22					7				22.81					21.22					7
Tangible book value (3)		18.49					17.83					17.56					17.09					16.95					9				18.49					16.95					9
Key performance ratios:
Return on common equity - GAAP (2)(4)		14.08			%		15.37			%		12.36			%		10.06			%		6.17			%						14.71			%		7.01			%
Return on common equity - operating (1)(2)(4)		14.25					15.63					12.77					10.69					6.25									14.92					7.13
Return on tangible common equity - operating (1)(2)(3)(4)		17.81					19.68					16.23					13.52					8.09									18.72					9.20
Return on assets - GAAP (4)		1.46					1.62					1.30					1.07					0.71									1.54					0.85
Return on assets - operating (1)(4)		1.48					1.65					1.34					1.14					0.72									1.56					0.86
Return on assets - pre-tax pre-provision (4)(5)		1.64					1.80					1.77					1.86					1.86									1.72					1.91
Return on assets - pre-tax pre-provision, excluding merger- related and other charges (1)(4)(5)		1.67					1.83					1.82					1.93					1.87									1.75					1.92
Net interest margin (fully taxable equivalent) (4)		3.19					3.22					3.55					3.27					3.42									3.20					3.73
Efficiency ratio - GAAP		54.53					53.55					56.73					54.14					55.86									54.04					56.00
Efficiency ratio - operating (1)		53.92					52.68					55.42					52.24					55.59									53.30					55.59
Equity to total assets		11.04					10.95					11.29					11.47					11.81									11.04					11.81
Tangible common equity to tangible assets (3)		8.71					8.57					8.81					8.89					9.12									8.71					9.12
ASSET QUALITY
Nonperforming loans		$	46,123				$	55,900				$	61,599				$	49,084				$	48,021				(4	)			$	46,123				$	48,021				(4	)
Foreclosed properties		224					596					647					953					477									224					477
Total nonperforming assets ("NPAs")		46,347					56,496					62,246					50,037					48,498					(4	)			46,347					48,498					(4	)
Allowance for credit losses - loans		111,616					126,866					137,010					134,256					103,669					8				111,616					103,669					8
Net charge-offs		(456		)			(305		)			1,515					2,538					6,149									(761		)			14,263					(105	)
Allowance for credit losses - loans to loans		0.98			%		1.09			%		1.20			%		1.14			%		1.02			%						0.98			%		1.02			%
Net charge-offs to average loans (4)		(0.02		)			(0.01		)			0.05					0.09					0.25									(0.01		)			0.31
NPAs to loans and foreclosed properties		0.41					0.48					0.55					0.42					0.48									0.41					0.48
NPAs to total assets		0.25					0.30					0.35					0.29					0.32									0.25					0.32
AVERAGE BALANCES ($ in millions)
Loans		$	11,617				$	11,433				$	11,595				$	11,644				$	9,773				19				$	11,525				$	9,301				24
Investment securities		4,631					3,991					3,326					2,750					2,408					92				4,313					2,464					75
Earning assets		17,540					16,782					16,394					15,715					12,958					35				17,163					12,378					39
Total assets		18,792					18,023					17,698					17,013					14,173					33				18,410					13,558					36
Deposits		16,132					15,366					15,057					14,460					12,071					34				15,751					11,493					37
Shareholders’ equity		2,060					2,025					1,994					1,948					1,686					22				2,042					1,670					22
Common shares - basic (thousands)		87,289					87,322					87,258					87,129					78,920					11				87,306					79,130					10
Common shares - diluted (thousands)		87,421					87,466					87,333					87,205					78,924					11				87,443					79,186					10
AT PERIOD END ($ in millions)
Loans		$	11,391				$	11,679				$	11,371				$	11,799				$	10,133				12				$	11,391				$	10,133				12
Investment securities		4,928					4,332					3,645					3,089					2,432					103				4,928					2,432					103
Total assets		18,896					18,557					17,794					17,153					15,005					26				18,896					15,005					26
Deposits		16,328					15,993					15,232					14,603					12,702					29				16,328					12,702					29
Shareholders’ equity		2,086					2,031					2,008					1,967					1,772					18				2,086					1,772					18
Common shares outstanding (thousands)		86,665					86,777					86,675					86,611					78,335					11				86,665					78,335					11

⁽¹⁾ Excludes merger-related and other charges. ⁽²⁾ Net income less 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. ⁽⁵⁾ Excludes income tax expense and provision for credit losses.

UNITED COMMUNITY BANKS, INC.
Non-GAAP Performance Measures Reconciliation
Selected Financial Information
		2021										2020															For the Six Months Ended June 30,
(in thousands, except per share data)		Second Quarter					First Quarter					Fourth Quarter					Third Quarter					Second Quarter					2021					2020
Expense reconciliation
Expenses (GAAP)		$	95,540				$	95,194				$	106,490				$	95,981				$	83,980				$	190,734				$	165,518
Merger-related and other charges		(1,078		)			(1,543		)			(2,452		)			(3,361		)			(397		)			(2,621		)			(1,205		)
Expenses - operating		$	94,462				$	93,651				$	104,038				$	92,620				$	83,583				$	188,113				$	164,313
Net income reconciliation
Net income (GAAP)		$	70,260				$	73,706				$	59,502				$	47,607				$	25,096				$	143,966				$	56,980
Merger-related and other charges		1,078					1,543					2,452					3,361					397					2,621					1,205
Income tax benefit of merger-related and other charges		(246		)			(335		)			(552		)			(519		)			(87		)			(581		)			(269		)
Net income - operating		$	71,092				$	74,914				$	61,402				$	50,449				$	25,406				$	146,006				$	57,916
Net income to pre-tax pre-provision income reconciliation
Net income (GAAP)		$	70,260				$	73,706				$	59,502				$	47,607				$	25,096				$	143,966				$	56,980
Income tax expense		22,005					20,150					17,871					11,755					6,923					42,155					15,730
(Release of) provision for credit losses		(13,588		)			(12,281		)			2,907					21,793					33,543					(25,869		)			55,734
Pre-tax pre-provision income		$	78,677				$	81,575				$	80,280				$	81,155				$	65,562				$	160,252				$	128,444
Diluted income per common share reconciliation
Diluted income per common share (GAAP)		$	0.78				$	0.82				$	0.66				$	0.52				$	0.32				$	1.60				$	0.71
Merger-related and other charges, net of tax		0.01					0.01					0.02					0.03					—					0.02					0.02
Diluted income per common share - operating		$	0.79				$	0.83				$	0.68				$	0.55				$	0.32				$	1.62				$	0.73
Book value per common share reconciliation
Book value per common share (GAAP)		$	22.81				$	22.15				$	21.90				$	21.45				$	21.22				$	22.81				$	21.22
Effect of goodwill and other intangibles		(4.32		)			(4.32		)			(4.34		)			(4.36		)			(4.27		)			(4.32		)			(4.27		)
Tangible book value per common share		$	18.49				$	17.83				$	17.56				$	17.09				$	16.95				$	18.49				$	16.95
Return on tangible common equity reconciliation
Return on common equity (GAAP)		14.08			%		15.37			%		12.36			%		10.06			%		6.17			%		14.71			%		7.01			%
Merger-related and other charges, net of tax		0.17					0.26					0.41					0.63					0.08					0.21					0.12
Return on common equity - operating		14.25					15.63					12.77					10.69					6.25					14.92					7.13
Effect of goodwill and other intangibles		3.56					4.05					3.46					2.83					1.84					3.80					2.07
Return on tangible common equity - operating		17.81			%		19.68			%		16.23			%		13.52			%		8.09			%		18.72			%		9.20			%
Return on assets reconciliation
Return on assets (GAAP)		1.46			%		1.62			%		1.30			%		1.07			%		0.71			%		1.54			%		0.85			%
Merger-related and other charges, net of tax		0.02					0.03					0.04					0.07					0.01					0.02					0.01
Return on assets - operating		1.48			%		1.65			%		1.34			%		1.14			%		0.72			%		1.56			%		0.86			%
Return on assets to return on assets- pre-tax pre-provision reconciliation
Return on assets (GAAP)		1.46			%		1.62			%		1.30			%		1.07			%		0.71			%		1.54			%		0.85			%
Income tax expense		0.47					0.46					0.40					0.28					0.20					0.46					0.23
(Release of) provision for credit losses		(0.29		)			(0.28		)			0.07					0.51					0.95					(0.28		)			0.83
Return on assets - pre-tax, pre-provision		1.64					1.80					1.77					1.86					1.86					1.72					1.91
Merger-related and other charges		0.03					0.03					0.05					0.07					0.01					0.03					0.01
Return on assets - pre-tax pre-provision, excluding merger-related and other charges		1.67			%		1.83			%		1.82			%		1.93			%		1.87			%		1.75			%		1.92			%
Efficiency ratio reconciliation
Efficiency ratio (GAAP)		54.53			%		53.55			%		56.73			%		54.14			%		55.86			%		54.04			%		56.00			%
Merger-related and other charges		(0.61		)			(0.87		)			(1.31		)			(1.90		)			(0.27		)			(0.74		)			(0.41		)
Efficiency ratio - operating		53.92			%		52.68			%		55.42			%		52.24			%		55.59			%		53.30			%		55.59			%
Tangible common equity to tangible assets reconciliation
Equity to total assets (GAAP)		11.04			%		10.95			%		11.29			%		11.47			%		11.81			%		11.04			%		11.81			%
Effect of goodwill and other intangibles		(1.82		)			(1.86		)			(1.94		)			(2.02		)			(2.05		)			(1.82		)			(2.05		)
Effect of preferred equity		(0.51		)			(0.52		)			(0.54		)			(0.56		)			(0.64		)			(0.51		)			(0.64		)
Tangible common equity to tangible assets		8.71			%		8.57			%		8.81			%		8.89			%		9.12			%		8.71			%		9.12			%
Allowance for credit losses - loans to loans reconciliation
Allowance for credit losses - loans to loans (GAAP)		0.98			%		1.09			%		1.20			%		1.14			%		1.02			%		0.98			%		1.02			%
Effect of PPP loans		0.04					0.09					0.08					0.14					0.13					0.04					0.13
Allowance for credit losses - loans to loans, excluding PPP loans		1.02			%		1.18			%		1.28			%		1.28			%		1.15			%		1.02			%		1.15			%

UNITED COMMUNITY BANKS, INC.
Financial Highlights
Loan Portfolio Composition at Period-End
	2021								2020												Linked				Year over
(in millions)	Second Quarter				First Quarter				Fourth Quarter				Third Quarter				Second Quarter				Quarter Change				Year Change
LOANS BY CATEGORY
Owner occupied commercial RE	$	2,149			$	2,107			$	2,090			$	2,009			$	1,759			$	42			$	390
Income producing commercial RE	2,550				2,599				2,541				2,493				2,178				(49		)		372
Commercial & industrial	1,762				1,760				1,853				1,788				1,219				2				543
Paycheck protection program	472				883				646				1,317				1,095				(411		)		(623		)
Commercial construction	927				960				967				987				946				(33		)		(19		)
Equipment financing	969				913				864				823				779				56				190
Total commercial	8,829				9,222				8,961				9,417				7,976				(393		)		853
Residential mortgage	1,473				1,362				1,285				1,270				1,152				111				321
Home equity lines of credit	661				679				697				707				654				(18		)		7
Residential construction	289				272				281				257				230				17				59
Consumer	139				144				147				148				121				(5		)		18
Total loans	$	11,391			$	11,679			$	11,371			$	11,799			$	10,133			$	(288	)		$	1,258
LOANS BY MARKET (1)
North Georgia	$	962			$	982			$	955			$	945			$	951			$	(20	)		$	11
Atlanta	1,938				1,953				1,889				1,853				1,852				(15		)		86
North Carolina	1,374				1,326				1,281				1,246				1,171				48				203
Coastal Georgia	605				597				617				614				618				8				(13		)
Gainesville	224				222				224				229				233				2				(9		)
East Tennessee	394				398				415				420				433				(4		)		(39		)
South Carolina	2,107				1,997				1,947				1,870				1,778				110				329
Florida	1,141				1,160				1,435				1,453				—				(19		)		1,141
Commercial Banking Solutions	2,646				3,044				2,608				3,169				3,097				(398		)		(451		)
Total loans	$	11,391			$	11,679			$	11,371			$	11,799			$	10,133			$	(288	)		$	1,258

⁽¹⁾ Certain loans previously included in the Florida geographic market were reclassified to Commercial Banking Solutions following Seaside’s core systems conversion in the first quarter of 2021.

UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality
		2021								2020
(in thousands)		Second Quarter				First Quarter				Fourth Quarter
NONACCRUAL LOANS
Owner occupied RE		$	6,128			$	7,908			$	8,582
Income producing RE		13,100				13,740				15,149
Commercial & industrial		8,563				13,864				16,634
Commercial construction		1,229				1,984				1,745
Equipment financing		1,771				2,171				3,405
Total commercial		30,791				39,667				45,515
Residential mortgage		13,485				14,050				12,858
Home equity lines of credit		1,433				1,707				2,487
Residential construction		307				322				514
Consumer		107				154				225
Total		$	46,123			$	55,900			$	61,599

		2021																2020
		Second Quarter								First Quarter								Fourth Quarter
(in thousands)		Net Charge- Offs				Net Charge- Offs to Average Loans (1)				Net Charge- Offs				Net Charge- Offs to Average Loans (1)				Net Charge- Offs				Net Charge- Offs to Average Loans (1)
NET CHARGE-OFFS BY CATEGORY
Owner occupied RE		$	(155	)		(0.03	)	%		$	(240	)		(0.05	)	%		$	(277	)		(0.05	)	%
Income producing RE		(161		)		(0.02	)			991				0.16				(1,718		)		(0.27	)
Commercial & industrial		60				0.01				(2,753		)		(0.44	)			2,294				0.33
Commercial construction		(293		)		(0.12	)			22				0.01				(129		)		(0.05	)
Equipment financing		301				0.13				1,511				0.70				1,595				0.75
Total commercial		(248		)		(0.01	)			(469		)		(0.02	)			1,765				0.08
Residential mortgage		(194		)		(0.05	)			92				0.03				(25		)		(0.01	)
Home equity lines of credit		(112		)		(0.07	)			(73		)		(0.04	)			(151		)		(0.09	)
Residential construction		(33		)		(0.05	)			(60		)		(0.09	)			(47		)		(0.07	)
Consumer		131				0.37				205				0.58				(27		)		(0.07	)
Total		$	(456	)		(0.02	)			$	(305	)		(0.01	)			$	1,515			0.05
(1) Annualized.

UNITED COMMUNITY BANKS, INC.

Consolidated Balance Sheets (Unaudited)

(in thousands, except share and per share data)		June 30, 2021				December 31, 2020
ASSETS
Cash and due from banks		$	121,589			$	148,896
Interest-bearing deposits in banks		1,297,808				1,459,723
Cash and cash equivalents		1,419,397				1,608,619
Debt securities available-for-sale		4,075,781				3,224,721
Debt securities held-to-maturity (fair value $861,488 and $437,193)		852,404				420,361
Loans held for sale at fair value		98,194				105,433
Loans and leases held for investment		11,390,746				11,370,815
Less allowance for credit losses - loans and leases		(111,616		)		(137,010		)
Loans and leases, net		11,279,130				11,233,805
Premises and equipment, net		224,980				218,489
Bank owned life insurance		203,449				201,969
Accrued interest receivable		43,521				47,672
Net deferred tax asset		32,918				38,411
Derivative financial instruments		58,489				86,666
Goodwill and other intangible assets, net		379,909				381,823
Other assets		227,551				226,405
Total assets		$	18,895,723			$	17,794,374
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Deposits:
Noninterest-bearing demand		$	6,260,756			$	5,390,291
NOW and interest-bearing demand		3,518,686				3,346,490
Money market		3,766,645				3,550,335
Savings		1,097,663				950,854
Time		1,500,049				1,704,290
Brokered		183,968				290,098
Total deposits		16,327,767				15,232,358
Long-term debt		261,919				326,956
Derivative financial instruments		27,089				29,003
Accrued expenses and other liabilities		192,662				198,527
Total liabilities		16,809,437				15,786,844
Shareholders' equity:
Preferred stock; $1 par value; 10,000,000 shares authorized; Series I, $25,000 per share liquidation preference; 4,000 shares issued and outstanding		96,422				96,422
Common stock, $1 par value; 200,000,000 shares authorized; 86,664,894 and 86,675,279 shares issued and outstanding		86,665				86,675
Common stock issuable; 571,580 and 600,834 shares		10,650				10,855
Capital surplus		1,636,875				1,638,999
Retained earnings		244,006				136,869
Accumulated other comprehensive income		11,668				37,710
Total shareholders' equity		2,086,286				2,007,530
Total liabilities and shareholders' equity		$	18,895,723			$	17,794,374

UNITED COMMUNITY BANKS, INC.

Consolidated Statements of Income (Unaudited)

		Three Months Ended June 30,								Six Months Ended June 30,
(in thousands, except per share data)		2021				2020				2021				2020
Interest revenue:
Loans, including fees		$	128,058			$	107,862			$	253,784			$	225,925
Investment securities, including tax exempt of $2,255 and $1,570 and $4,405 and $3,093, respectively		17,542				15,615				32,990				33,009
Deposits in banks and short-term investments		209				128				577				1,218
Total interest revenue		145,809				123,605				287,351				260,152
Interest expense:
Deposits:
NOW and interest-bearing demand		1,382				1,628				2,868				4,606
Money market		1,355				3,421				3,159				7,952
Savings		53				39				102				74
Time		830				6,183				2,710				13,714
Deposits		3,620				11,271				8,839				26,346
Short-term borrowings		—				—				—				1
Federal Home Loan Bank advances		—				—				2				1
Long-term debt		3,813				3,030				8,070				5,894
Total interest expense		7,433				14,301				16,911				32,242
Net interest revenue		138,376				109,304				270,440				227,910
(Release of) provision for credit losses		(13,588		)		33,543				(25,869		)		55,734
Net interest revenue after provision for credit losses		151,964				75,761				296,309				172,176
Noninterest income:
Service charges and fees		8,335				6,995				15,905				15,633
Mortgage loan gains and other related fees		11,136				23,659				33,708				31,969
Wealth management fees		3,822				1,324				7,327				2,964
Gains from sales of other loans, net		4,123				1,040				5,153				2,714
Securities gains, net		41				—				41				—
Other		8,384				7,220				18,412				12,772
Total noninterest income		35,841				40,238				80,546				66,052
Total revenue		187,805				115,999				376,855				238,228
Noninterest expenses:
Salaries and employee benefits		59,414				51,811				119,999				103,169
Communications and equipment		7,408				6,556				14,611				12,502
Occupancy		7,078				5,945				14,034				11,659
Advertising and public relations		1,493				2,260				2,692				3,534
Postage, printing and supplies		1,618				1,613				3,440				3,283
Professional fees		4,928				4,823				9,162				8,920
Lending and loan servicing expense		3,181				3,189				6,058				5,482
Outside services - electronic banking		2,285				1,796				4,503				3,628
FDIC assessments and other regulatory charges		1,901				1,558				3,797				3,042
Amortization of intangibles		929				987				1,914				2,027
Merger-related and other charges		1,078				397				2,621				1,205
Other		4,227				3,045				7,903				7,067
Total noninterest expenses		95,540				83,980				190,734				165,518
Net income before income taxes		92,265				32,019				186,121				72,710
Income tax expense		22,005				6,923				42,155				15,730
Net income		70,260				25,096				143,966				56,980
Preferred stock dividends		1,719				—				3,438				—
Undistributed earnings allocated to participating securities		432				183				894				426
Net income available to common shareholders		$	68,109			$	24,913			$	139,634			$	56,554
Net income per common share:
Basic		$	0.78			$	0.32			$	1.60			$	0.71
Diluted		0.78				0.32				1.60				0.71
Weighted average common shares outstanding:
Basic		87,289				78,920				87,306				79,130
Diluted		87,421				78,924				87,443				79,186

Average Consolidated Balance Sheets and Net Interest Analysis

For the Three Months Ended June 30,

		2021												2020
(dollars in thousands, fully taxable equivalent (FTE))		Average Balance				Interest				Average Rate				Average Balance				Interest				Average Rate
Assets:
Interest-earning assets:
Loans, net of unearned income (FTE) (1)(2)		$	11,616,802			$	127,458			4.40		%		$	9,772,703			$	107,398			4.42	%
Taxable securities (3)		4,242,297				15,287				1.44				2,229,371				14,045				2.52
Tax-exempt securities (FTE) (1)(3)		388,609				3,030				3.12				178,903				2,110				4.72
Federal funds sold and other interest-earning assets		1,292,026				1,055				0.33				776,776				857				0.44
Total interest-earning assets (FTE)		17,539,734				146,830				3.36				12,957,753				124,410				3.86
Noninterest-earning assets:
Allowance for credit losses		(128,073		)										(89,992		)
Cash and due from banks		152,443												138,842
Premises and equipment		225,017												217,096
Other assets (3)		1,002,634												949,201
Total assets		$	18,791,755											$	14,172,900
Liabilities and Shareholders' Equity:
Interest-bearing liabilities:
Interest-bearing deposits:
NOW and interest-bearing demand		$	3,428,009			1,382				0.16				$	2,444,895			1,628				0.27
Money market		3,814,960				1,355				0.14				2,541,805				3,421				0.54
Savings		1,080,267				53				0.02				788,247				39				0.02
Time		1,548,487				899				0.23				1,805,671				6,058				1.35
Brokered time deposits		64,332				(69		)		(0.43	)			130,556				125				0.39
Total interest-bearing deposits		9,936,055				3,620				0.15				7,711,174				11,271				0.59
Federal funds purchased and other borrowings		111				—				—				1				—				—
Federal Home Loan Bank advances		—				—				—				—				—				—
Long-term debt		285,389				3,813				5.36				228,096				3,030				5.34
Total borrowed funds		285,500				3,813				5.36				228,097				3,030				5.34
Total interest-bearing liabilities		10,221,555				7,433				0.29				7,939,271				14,301				0.72
Noninterest-bearing liabilities:
Noninterest-bearing deposits		6,196,045												4,360,095
Other liabilities		314,130												187,375
Total liabilities		16,731,730												12,486,741
Shareholders' equity		2,060,025												1,686,159
Total liabilities and shareholders' equity		$	18,791,755											$	14,172,900
Net interest revenue (FTE)						$	139,397											$	110,109
Net interest-rate spread (FTE)										3.07		%										3.14	%
Net interest margin (FTE) (4)										3.19		%										3.42	%

(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 26%, 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 on which the accrual of interest has been discontinued and loans that are held for sale.
(3) Securities available for sale are shown at amortized cost. Pretax unrealized gains of $28.6 million and $66.3 million in 2021 and 2020, respectively, 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.

Average Consolidated Balance Sheets and Net Interest Analysis

For the Six Months Ended June 30,

		2021											2020
(dollars in thousands, fully taxable equivalent (FTE))		Average Balance				Interest				Average Rate			Average Balance				Interest				Average Rate
Assets:
Interest-earning assets:
Loans, net of unearned income (FTE) (1)(2)		$	11,525,363			$	252,580			4.42	%		$	9,300,792			$	225,194			4.87	%
Taxable securities (3)		3,932,545				28,585				1.45			2,293,502				29,916				2.61
Tax-exempt securities (FTE) (1)(3)		380,370				5,918				3.11			170,578				4,155				4.87
Federal funds sold and other interest-earning assets		1,324,776				2,277				0.34			612,776				2,489				0.81
Total interest-earning assets (FTE)		17,163,054				289,360				3.40			12,377,648				261,754				4.25
Non-interest-earning assets:
Allowance for loan losses		(135,845		)									(79,885		)
Cash and due from banks		146,401											133,548
Premises and equipment		223,224											218,170
Other assets (3)		1,012,896											908,828
Total assets		$	18,409,730										$	13,558,309
Liabilities and Shareholders' Equity:
Interest-bearing liabilities:
Interest-bearing deposits:
NOW and interest-bearing demand		$	3,379,794			2,868				0.17			$	2,428,815			4,606				0.38
Money market		3,774,201				3,159				0.17			2,441,264				7,952				0.66
Savings		1,035,176				102				0.02			750,179				74				0.02
Time		1,595,196				2,487				0.31			1,823,612				13,308				1.47
Brokered time deposits		69,765				223				0.64			105,689				406				0.77
Total interest-bearing deposits		9,854,132				8,839				0.18			7,549,559				26,346				0.70
Federal funds purchased and other borrowings		62				—				—			199				1				1.01
Federal Home Loan Bank advances		1,657				2				0.24			83				1				2.42
Long-term debt		301,193				8,070				5.40			220,429				5,894				5.38
Total borrowed funds		302,912				8,072				5.37			220,711				5,896				5.37
Total interest-bearing liabilities		10,157,044				16,911				0.34			7,770,270				32,242				0.83
Noninterest-bearing liabilities:
Noninterest-bearing deposits		5,896,882											3,943,740
Other liabilities		313,374											174,781
Total liabilities		16,367,300											11,888,791
Shareholders' equity		2,042,430											1,669,518
Total liabilities and shareholders' equity		$	18,409,730										$	13,558,309
Net interest revenue (FTE)						$	272,449										$	229,512
Net interest-rate spread (FTE)										3.06	%										3.42	%
Net interest margin (FTE) (4)										3.20	%										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 26%, 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 on which the accrual of interest has been discontinued and loans that are held for sale.
(3) Securities available for sale are shown at amortized cost. Pretax unrealized gains of $43.4 million and $59.6 million in 2021 and 2020, respectively, 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.

About United Community Banks, Inc.

United Community Banks, Inc. (NASDAQGS: UCBI) provides a full range of banking, wealth management and mortgage services for relationship-oriented consumers and business owners. The company, known as “The Bank That SERVICE Built,” has been recognized nationally for delivering award-winning service. United has $18.9 billion in assets and 162 offices in Florida, Georgia, North Carolina, South Carolina and Tennessee along with a national SBA lending franchise and a national equipment lending subsidiary. In 2021, J.D. Power ranked United highest in customer satisfaction with retail banking in the Southeast, marking seven out of the last eight years United earned the coveted award. United was also named one of the "Best Banks to Work For" by American Banker in 2020 for the fourth year in a row based on employee satisfaction. Forbes included United in its inaugural list of the World’s Best Banks in 2019 and again in 2020. Forbes also recognized United on its 2021 list of the 100 Best Banks in America for the eighth consecutive year. United also received five Greenwich Excellence Awards in 2020 for excellence in Small Business Banking, including a national award for Overall Satisfaction. Additional information about United can be found at www.ucbi.com.

Non-GAAP Financial Measures

This press release, including the accompanying financial statement tables, contains financial information determined by methods other than in accordance with generally accepted accounting principles, or GAAP. This financial information includes certain operating performance measures, which exclude merger-related and other charges that are not considered part of recurring operations, such as “operating net income,” “pre-tax, pre-provision income,” “operating net income per diluted common share,” “operating earnings per share,” “tangible book value per common share,” “operating return on common equity,” “operating return on tangible common equity,” “operating return on assets,” “return on assets - pre-tax, pre-provision, excluding merger-related and other charges,” “return on assets - pre-tax, pre-provision,” “operating efficiency ratio,” and “tangible common equity to tangible assets.” These non-GAAP measures are included because United believes they may provide useful supplemental information for evaluating United’s underlying performance trends. These measures should be viewed in addition to, and not as an alternative to or substitute for, measures determined in accordance with GAAP, and are not necessarily comparable to non-GAAP measures that may be presented by other companies. To the extent applicable, reconciliations of these non-GAAP measures to the most directly comparable measures as reported in accordance with GAAP are included with the accompanying financial statement tables.

For more information:

Jefferson Harralson
Chief Financial Officer
(864) 240-6208
Jefferson_Harralson@ucbi.com