Diluted Earnings per Share of $0.46, up 15.6%
vs. 2Q15
Adjusted Diluted Earnings per Share of $0.49,
up 16.9% vs. 2Q15
Synovus Financial Corp. (NYSE: SNV) today reported financial
results for the quarter ended June 30, 2016.
Second Quarter Highlights
- Net income available to common
shareholders for the second quarter 2016 was $57.9 million or $0.46
per diluted share as compared to $50.0 million, or $0.39 per
diluted share for the previous quarter and $53.2 million, or $0.40
per diluted share for the second quarter 2015.
- Adjusted diluted earnings per share of
$0.49 grew 16.9% from $0.42 for the second quarter 2015.
- Total loans grew $302.7 million or 5.3%
annualized from the previous quarter and $1.57 billion or 7.3% as
compared to the second quarter 2015.
- Total average deposits grew $397.8
million or 6.9% annualized from the previous quarter and $1.14
billion or 5.1% as compared to the second quarter 2015.
- Total revenues1 of $289.3 million grew
$8.1 million or 2.9% from the previous quarter and 7.0% from the
second quarter 2015.
- Credit quality metrics improved with
the NPL ratio declining to 0.67% from 0.78% in the previous quarter
and 0.81% in the second quarter 2015.
- The company continued to execute on the
$300 million repurchase program announced in October 2015,
acquiring $60.5 million of common stock in the second quarter.
- From October 2015 through July 18,
2016, the company has repurchased $236.2 million of common stock,
reducing total share count by 8.0 million.
“Our second quarter results demonstrate continued solid
performance, including strong revenue growth and further
diversification of our loan portfolio with increases in both
C&I and consumer lending,” said Kessel D. Stelling, Synovus
Chairman and CEO. “We were also pleased during the second quarter
to be named by American Banker and the Reputation Institute as one
of the nation’s most reputable banks. This recognition further
demonstrates our team’s commitment to exceptional service, and
further validates that our relationship-centered model is a
highly-valued competitive differentiator. We were especially
pleased with the number one ranking by non-customers, which we
believe signals a strong opportunity to gain market share.”
Balance Sheet
- Total loans ended the quarter at $23.06
billion, up $302.7 million or 5.3% annualized from the previous
quarter and up $1.57 billion or 7.3% as compared to the second
quarter 2015.
- Retail loans grew by $261.0 million
from the previous quarter, or 24.1% annualized.
- Commercial and industrial loans grew by
$146.0 million from the previous quarter, or 5.4% annualized.
- Commercial real estate loans declined
$105.9 million from the previous quarter, or 5.6% annualized.
- Total average deposits for the quarter
were $23.61 billion, and grew by $397.8 million or 6.9% annualized
from the previous quarter and $1.14 billion or 5.1% as compared to
the second quarter 2015.
- Average core deposits for the quarter
grew by $156.0 million or 2.8% annualized from the previous quarter
and $1.36 billion or 6.5% as compared to the second quarter
2015.
- Average core deposits, excluding state,
county, and municipal deposits, grew by $316.7 million or 6.5%
annualized from the previous quarter and $1.36 billion or 7.3% as
compared to the second quarter 2015.
Core Performance
- Total revenues1 were $289.3 million for
the second quarter 2016, up $8.1 million or 2.9% from the previous
quarter and up 7.0% as compared to the second quarter 2015.
- Net interest income was $221.4 million
for the second quarter 2016, up $3.3 million or 1.5% from the
previous quarter and up 8.7% as compared to the second quarter
2015.
- Net interest margin was 3.27%,
unchanged from the previous quarter. Yield on earning assets was
3.73% and the effective cost of funds was 0.46% for the second
quarter 2016, both unchanged from the previous quarter.
- Total non-interest income was $67.9
million, up $4.7 million or 7.5% compared to the previous quarter
and down 1.4% as compared to the second quarter 2015.
- Adjusted non-interest income increased
$4.8 million or 7.6% compared to the previous quarter and 1.6% as
compared to the second quarter 2015.
- Core banking fees2 were $33.8 million,
up $488 thousand or 1.5% from the previous quarter, primarily
driven by higher service charges on deposits, which were $530
thousand.
- Financial Management Services revenues,
consisting primarily of fiduciary and asset management fees and
brokerage revenue, increased $1.5 million, or 8.1% from the
previous quarter.
- Mortgage banking income increased $457
thousand, or 8.3% from the previous quarter.
- Other non-interest income increased
$2.2 million from the previous quarter, primarily driven by a $900
thousand net gain from private equity investments as compared to a
$390 thousand net loss in the previous quarter.
- Total non-interest expense for the
second quarter of 2016 was $188.6 million, up $377 thousand from
the previous quarter and up $10.8 million or 6.1% as compared to
the second quarter of 2015.
- Adjusted non-interest expense for the
second quarter 2016 was $182.4 million, up $3.1 million or 1.7%
from the previous quarter and up $9.4 million or 5.4% as compared
to the second quarter 2015.
- Employment expense of $97.1 million
decreased $4.3 million or 4.2% from the previous quarter,
reflecting seasonal decline in payroll taxes.
- Advertising expense of $7.4 million
increased $4.9 million from the previous quarter as a result of
resuming brand awareness activities.
- Foreclosed real estate expense of $4.6
million increased $1.9 million from the previous quarter.
- Adjusted efficiency ratio for the
second quarter was 61.54% as compared to 61.92% the previous
quarter and 61.62% in the second quarter of 2015.
Credit Quality
Improvement in credit quality continued.
- Non-performing loans were $154.1
million at June 30, 2016, down $24.1 million or 13.5% from the
previous quarter, and down $19.6 million or 11.3% from June 30,
2015. The non-performing loan ratio was 0.67% at June 30, 2016, as
compared to 0.78% at the end of the previous quarter and 0.81% at
June 30, 2015.
- Total non-performing assets were $187.4
million at June 30, 2016, down $29.3 million or 13.5% from the
previous quarter, and down $52.7 million or 22.0% from June 30,
2015. The non-performing asset ratio was 0.81% at June 30, 2016, as
compared to 0.95% at the end of the previous quarter and 1.11% at
June 30, 2015.
- Net charge-offs were $6.1 million in
the second quarter 2016, down $1.2 million or 16.6% from $7.4
million in the previous quarter. The annualized net charge-off
ratio was 0.11% in the second quarter as compared to 0.13% in the
previous quarter.
- Total delinquencies (consisting of
loans 30 or more days past due and still accruing) remain low at
0.24% of total loans at June 30, 2016 as compared to 0.28% the
previous quarter and 0.24% at June 30, 2015.
Capital Ratios
Capital ratios remained strong and include the impact of common
stock repurchases completed through June 30, 2016 and phase-out of
sub-debt maturing in the second quarter 2017.
- Common Equity Tier 1 ratio was 10.02%
at June 30, 2016 compared to 10.04% at March 31, 2016.
- Tier 1 Capital ratio was 10.06% at June
30, 2016 compared to 10.04% at March 31, 2016.
- Total Risk Based Capital ratio was
12.05% at June 30, 2016 compared to 12.25% at March 31, 2016.
- Tier 1 Leverage ratio was 9.10% at June
30, 2016 compared to 9.15% at March 31, 2016.
- Tangible Common Equity ratio was 9.52%
at June 30, 2016 compared to 9.62% at March 31, 2016.
Second Quarter Earnings Conference Call
Synovus will host an earnings highlights conference call at 8:30
a.m. EDT on July 19, 2016. The earnings call will be accompanied by
a slide presentation. Shareholders and other interested parties may
listen to this conference call via simultaneous Internet broadcast.
For a link to the webcast, go to investor.synovus.com/events. The
replay will be archived for 12 months and will be available 30-45
minutes after the call.
Synovus Financial Corp.
Synovus Financial Corp. is a financial services company based in
Columbus, Georgia, with approximately $29 billion in assets.
Synovus provides commercial and retail banking, investment, and
mortgage services to customers through 28 locally-branded
divisions, 253 branches, and 335 ATMs in Georgia, Alabama, South
Carolina, Florida, and Tennessee. Synovus Bank, a wholly owned
subsidiary of Synovus, was recognized as one of America's Most
Reputable Banks by American Banker and the Reputation Institute in
2016 and 2015. Synovus is on the web at synovus.com, on Twitter
@synovus, and on LinkedIn at
http://linkedin.com/company/synovus.
Forward-Looking Statements
This press release and certain of our other filings with the
Securities and Exchange Commission contain statements that
constitute “forward-looking statements” within the meaning of, and
subject to the protections of, Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended. All statements other than
statements of historical fact are forward-looking statements. You
can identify these forward-looking statements through Synovus’ use
of words such as “believes,” “anticipates,” “expects,” “may,”
“will,” “assumes,” “should,” “predicts,” “could,” “would,”
“intends,” “targets,” “estimates,” “projects,” “plans,” “potential”
and other similar words and expressions of the future or otherwise
regarding the outlook for Synovus’ future business and financial
performance and/or the performance of the banking industry and
economy in general. These forward-looking statements include, among
others, our expectations regarding deposits, loan growth and the
net interest margin, expectations on our growth strategy, expense
initiatives, and future profitability, expectations on credit
trends and key credit metrics, and the assumptions underlying our
expectations. Prospective investors are cautioned that any such
forward-looking statements are not guarantees of future performance
and involve known and unknown risks and uncertainties which may
cause the actual results, performance or achievements of Synovus to
be materially different from the future results, performance or
achievements expressed or implied by such forward-looking
statements. Forward-looking statements are based on the information
known to, and current beliefs and expectations of, Synovus’
management and are subject to significant risks and uncertainties.
Actual results may differ materially from those contemplated by
such forward-looking statements. A number of factors could cause
actual results to differ materially from those contemplated by the
forward-looking statements in this press release. Many of these
factors are beyond Synovus’ ability to control or predict.
These forward-looking statements are based upon information
presently known to Synovus’ management and are inherently
subjective, uncertain and subject to change due to any number of
risks and uncertainties, including, without limitation, the risks
and other factors set forth in Synovus’ filings with the Securities
and Exchange Commission, including its Annual Report on Form 10-K
for the year ended December 31, 2015 under the captions “Cautionary
Notice Regarding Forward-Looking Statements” and “Risk Factors” and
in Synovus’ quarterly reports on Form 10-Q and current reports on
Form 8-K. We believe these forward-looking statements are
reasonable; however, undue reliance should not be placed on any
forward-looking statements, which are based on current expectations
and speak only as of the date that they are made. We do not assume
any obligation to update any forward-looking statements as a result
of new information, future developments or otherwise, except as
otherwise may be required by law.
Use of Non-GAAP Financial Measures
The measures entitled average core deposits; average core
deposits excluding average state, county, and municipal deposits;
tangible common equity ratio; common equity Tier 1 (CET1) ratio
(fully phased-in); adjusted diluted earnings per share; adjusted
non-interest income; adjusted non-interest expense; and adjusted
efficiency ratio are not measures recognized under U.S. generally
accepted accounting principles (GAAP) and therefore are considered
non-GAAP financial measures. The most comparable GAAP measures are
total average deposits; total shareholders’ equity to total assets
ratio; net income per diluted common share; total non-interest
income; total non-interest expense, and efficiency ratio,
respectively.
Synovus believes that these non-GAAP financial measures provide
meaningful additional information about Synovus to assist
management, investors, and bank regulators in evaluating Synovus’
capital strength and the performance of its core business. Average
core deposits and average core deposits excluding state, county,
and municipal deposits are measures used by management to evaluate
organic growth of deposits and the quality of deposits as a funding
source. The Tangible Common Equity ratio and common equity Tier 1
(CET1) ratio (fully phased-in) are used by management and bank
regulators to assess the strength of our capital position. Adjusted
diluted earnings per share is a measure used by management to
evaluate operating results exclusive of items that are not
indicative of ongoing operations and impact period-to- period
comparisons. Adjusted non-interest income is a measure used by
management to evaluate non-interest income exclusive of net
investment securities gains. Adjusted non-interest expense and the
adjusted efficiency ratio are measures utilized by management to
measure the success of expense management initiatives focused on
reducing recurring controllable operating costs. These non-GAAP
financial measures should not be considered as substitutes for
total average deposits; total shareholders’ equity to total assets
ratio; net income per diluted common share; total non-interest
income; total non-interest expense; and efficiency ratio determined
in accordance with GAAP and may not be comparable to other
similarly titled measures at other companies.
The computations of average core deposits; average core deposits
excluding average state, county, and municipal deposits; tangible
common equity ratio; common equity Tier 1 (CET1) ratio (fully
phased-in); adjusted diluted earnings per share; adjusted
non-interest income; and adjusted non-interest expense; and the
reconciliation of these measures to total average deposits; total
shareholders’ equity to total assets ratio; net income per diluted
common share; total non-interest income; total non-interest
expense; and efficiency ratio are set forth in the tables
below.
1 Consists of net interest income and non-interest income
excluding investment securities gains, net
2 Include service charges on deposit accounts, bankcard fees,
letter of credit fees, ATM fee income, line of credit non-usage
fees, gains from sales of government guaranteed loans, and
miscellaneous other service charges.
Reconciliation of Non-GAAP Financial Measures
(dollars in
thousands) 2Q16 1Q16 2Q15
Average core deposits Average core deposits excluding
state, county, and municipal deposits Total average deposits $
23,608,027 23,210,263 22,466,102 Subtract: Average brokered
deposits
(1,337,001 )
(1,095,239 ) (1,555,931
) Average core deposits
22,271,026
22,115,024 20,910,171
Subtract: Average state, county, and municipal deposits
(2,280,038 )
(2,440,749 ) (2,277,783
) Average core deposits excluding state, county, and
municipal deposits
$ 19,990,988
19,674,275 18,632,388
Tangible common equity ratio Total assets $
29,459,691 29,171,257 28,205,870 Subtract: Goodwill (24,431 )
(24,431 ) (24,431 ) Subtract: Other intangible assets, net
(228 ) (277 )
(863 ) Tangible assets
$
29,435,032 29,146,549
28,180,576 Total shareholders’ equity $
2,951,659 2,953,268 3,006,157
Subtract: Goodwill
(24,431 ) (24,431 ) (24,431 )
Subtract: Other intangible assets, net
(228 ) (277 ) (863 )
Subtract: Series C Preferred Stock, no par
value
(125,980 ) (125,980
) (125,980 ) Tangible common
equity
$ 2,801,020
2,802,580 2,854,883 Total
shareholders’ equity to total assets ratio 10.02 % 10.12 % 10.66
Tangible common equity ratio 9.52 % 9.62 % 10.13
Common
Equity Tier 1 (CET1) ratio (fully phased-in) Common Equity Tier
1 (CET1) $ 2,615,939 2,609,191 2,615,827 Adjustment related to
capital components
(114,751 )
(125,980 ) (125,729
) CET1 (fully phased-in)
$
2,501,188 2,483,211
2,490,098 Total risk-weighted assets (fully
phased-in) $ 26,368,883 26,231,764 24,673,795 Common Equity Tier 1
(CET1) ratio (fully phased-in) 9.49 % 9.47 % 10.09 %
Reconciliation of Non-GAAP Financial Measures,
continued
(dollars in thousands) 2Q16 1Q16 2Q15
Adjusted Non-interest Income
Total non-interest income $ 67,886 63,147 68,832 Subtract:
Investment securities gains, net
-
(67 ) (1,985 )
Adjusted non-interest income
$ 67,886
63,080 66,847
Adjusted Diluted Earnings per Share Net income available to
common shareholders $ 57,898 49,972 53,234 Add: Litigation
contingency expense(1) - 2,700 4,400 Add: Restructuring charges
5,841 1,140 5 Add: Loss on early extinguishment of debt - 4,735 -
Tax effect of adjustments
(2,138 )
(3,138 ) (1,612
) Adjusted net income available to common shareholders
$ 61,601 55,409
56,027 Weighted average common shares
outstanding - diluted 125,699 127,857 133,625 Adjusted diluted
earnings per share
$ 0.49
0.43 0.42
Adjusted Non-interest Expense Total non-interest expense $
188,611 188,233 177,806 Subtract: Restructuring charges (5,841 )
(1,140 ) (5 ) Subtract: Visa indemnification charges (360 ) (360 )
(354 ) Subtract: Loss on early extinguishment of debt - (4,735 ) -
Subtract: Litigation contingency expense(1)
-
(2,700 ) (4,400
) Adjusted non-interest expense
$
182,410 179,298
173,047 Adjusted Efficiency Ratio
Adjusted non-interest expense $ 182,410 179,298 173,047 Subtract:
Other credit costs(2)
(4,143 )
(4,950 ) (6,175
) Adjusted non-interest expense excluding other credit
costs
$ 178,267
174,348 166,872 Net
interest income 221,449 218,193 203,644 Add: Tax equivalent
adjustment 329 305 330 Add: Total non-interest income 67,886 63,147
68,832 Subtract: Investment securities gains, net
- (67 )
(1,985 ) Total revenues
$
289,664 281,578
270,821 Adjusted efficiency ratio
61.54 % 61.92
61.62
(1) Amounts for other periods presented herein are not reported
separately as amounts are not material.
(2) Other credit costs consist primarily of foreclosed real
estate expense, net.
Synovus
INCOME STATEMENT DATA Six Months
Ended
(Unaudited) (Dollars in
thousands, except per share data)
June 30,
2016 2015 Change Interest income
$
501,716 465,055 7.9 % Interest expense
62,073
58,148 6.8 Net interest income
439,643
406,907 8.0 Provision for loan losses
16,070 11,034
45.6 Net interest income after provision for
loan losses
423,573 395,873 7.0
Non-interest income: Service charges on deposit accounts
39,950 38,928 2.6 Fiduciary and asset management fees
22,854 23,414 (2.4 ) Brokerage revenue
13,821 14,032
(1.5 ) Mortgage banking income
11,425 13,995 (18.4 )
Bankcard fees
16,718 16,576 0.9 Investment securities gains,
net
67 2,710 (97.5 ) Other fee income
10,084 9,851
2.4 Other non-interest income
16,114 15,181
6.1 Total non-interest income
131,033
134,687 (2.7 ) Non-interest expense: Salaries
and other personnel expense
198,419 191,054 3.9 Net
occupancy and equipment expense
53,360 52,713 1.2
Third-party processing expense
22,814 21,015 8.6 FDIC
insurance and other regulatory fees
13,344 13,725 (2.8 )
Professional fees
13,307 12,011 10.8 Advertising expense
9,761 6,309 54.7 Foreclosed real estate expense, net
7,272 13,847 (47.5 ) Visa indemnification charges
720
729 (1.2 ) Loss on early extinguishment of debt
4,735 - nm
Litigation contingency expense
2,700 4,400 (38.6 )
Restructuring charges, net
6,981 (102 ) nm Other operating
expenses
43,431 41,012 5.9 Total
non-interest expense
376,844 356,713 5.6
Income before income taxes
177,762
173,847 2.3 Income tax expense
64,773 64,091
1.1 Net income
112,989 109,756 2.9
Dividends on preferred stock
5,119 5,119 -
Net income available to common shareholders
$ 107,870 104,637 3.1 % Net
income per common share, basic
$ 0.85 0.78 8.8 %
Net income per common share, diluted
0.85 0.78 9.5
Cash dividends declared per common share
0.24 0.20
20.0 Return on average assets
0.78%
0.80
(2) bps
Return on average common equity
7.66 7.27 39
Weighted average common shares outstanding, basic
126,164
133,935 (5.8 )% Weighted average common shares outstanding, diluted
126,778 134,678 (5.9 ) nm - not meaningful bps -
basis points
Synovus
INCOME STATEMENT DATA (Unaudited) (In
thousands, except per share data) 2016
2015
2nd Quarter
Second First
Fourth Third Second '16 vs. '15
Quarter
Quarter Quarter Quarter
Quarter Change Interest income
$
252,393 249,323 242,814 238,093 233,654 8.0 % Interest
expense
30,944 31,130 30,194 30,303 30,010 3.1
Net interest income
221,449 218,193
212,620 207,790 203,644 8.7 Provision for loan losses
6,693 9,377 5,021 2,956 6,636 0.9
Net interest income after provision for loan losses
214,756 208,816 207,599 204,834 197,008 9.0
Non-interest income: Service charges on deposit
accounts
20,240 19,710 20,522 20,692 19,795 2.2 Fiduciary
and asset management fees
11,580 11,274 11,206 11,308 11,843
(2.2 ) Brokerage revenue
7,338 6,483 6,877 6,946 6,782 8.2
Mortgage banking income
5,941 5,484 4,136 5,965 7,511 (20.9
) Bankcard fees
8,346 8,372 8,262 8,334 8,499 (1.8 )
Investment securities gains, net
- 67 58 - 1,985 nm Other
fee income
5,280 4,804 5,798 5,521 4,605 14.7 Other
non-interest income
9,161 6,953 9,316 8,293
7,812 17.3 Total non-interest income
67,886 63,147 66,175 67,059 68,832 (1.4 )
Non-interest expense: Salaries and other personnel
expense
97,061 101,358 95,524 94,341 94,565 2.6 Net
occupancy and equipment expense
26,783 26,577 27,816 26,937
26,541 0.9 Third-party processing expense
11,698 11,116
10,993 10,844 10,672 9.6 FDIC insurance and other regulatory fees
6,625 6,719 6,776 6,591 6,767 (2.1 ) Professional fees
6,938 6,369 8,265 6,371 6,417 8.1 Advertising expense
7,351 2,410 3,680 5,488 2,865 156.6 Foreclosed real estate
expense, net
4,588 2,684 4,454 4,503 4,351 5.4 Visa
indemnification charges
360 360 371 363 354 1.7 Loss on
early extinguishment of debt
- 4,735 1,533 - - nm Litigation
contingency/settlement expenses
- 2,700 710 - 4,400 nm
Restructuring charges, net
5,841 1,140 69 69 5 nm Other
operating expenses
21,366 22,065 22,842 22,400
20,869 2.4 Total non-interest expense
188,611 188,233 183,033 177,907 177,806 6.1
Income before income taxes
94,031
83,730 90,741 93,986 88,034 6.8 Income tax expense
33,574 31,199 32,343 36,058 32,242 4.1
Net income
60,457 52,531 58,398 57,928 55,792 8.4
Dividends on preferred stock
2,559
2,559 2,559 2,559 2,559 - Net income available to
common shareholders
$ 57,898 49,972 55,839
55,369 53,233 8.8 % Net income per common share, basic
$ 0.46 0.39 0.43 0.42 0.40 15.6 % Net income
per common share, diluted
0.46 0.39 0.43 0.42 0.40 15.6
Cash dividends declared per common share
0.12 0.12
0.12 0.10 0.10 20.0 Return on average assets *
0.83 %
0.73 0.81 0.81 0.80
3 bps
Return on average common equity *
8.26 7.06 7.67 7.64 7.39
87 Weighted average common shares outstanding, basic
125,100 127,227 130,354 131,516 132,947 (5.9 )% Weighted
average common shares outstanding, diluted
125,699 127,857
131,197 132,297 133,625 (5.9 ) nm - not meaningful bps -
basis points * - ratios are annualized
Synovus
BALANCE SHEET DATA June 30, 2016 December 31,
2015 June 30, 2015
(Unaudited) (In thousands, except
share data) ASSETS Cash and cash equivalents
$
377,334 367,092 360,832 Interest bearing funds with Federal
Reserve Bank
904,406 829,887 1,289,205 Interest earning
deposits with banks
24,541 17,387 18,694
Federal funds sold and securities
purchased under resale agreements
77,685 69,819 72,487 Trading account assets, at fair value
1,001 5,097 11,973 Mortgage loans held for sale, at fair
value
87,824 59,275 98,202 Investment securities available
for sale, at fair value
3,580,359 3,587,818 3,354,673
Loans, net of deferred fees and costs
23,060,908 22,429,565
21,494,869 Allowance for loan losses
(255,076
) (252,496 ) (254,702 ) Loans, net
22,805,832
22,177,069 21,240,167 Premises and
equipment, net
424,967 445,155 445,579 Goodwill
24,431 24,431 24,431 Other real estate
33,289 47,030
66,449 Deferred tax asset, net
425,160 511,948 571,402 Other
assets
692,862 650,645 650,984
Total assets
$ 29,459,691 28,792,653
28,205,078 LIABILITIES AND
SHAREHOLDERS' EQUITY Liabilities: Deposits: Non-interest bearing
deposits
$ 6,934,443 6,732,970 6,421,815 Interest
bearing deposits, excluding brokered deposits
15,495,318
15,434,171 14,775,216 Brokered deposits
1,496,161
1,075,520 1,452,150 Total deposits
23,925,922 23,242,661 22,649,181 Federal funds
purchased and securities sold under repurchase agreements
247,179 177,025 188,285 Long-term debt
2,135,892
2,186,893 2,138,427 Other liabilities
199,039
185,878 223,028 Total liabilities
26,508,032 25,792,457 25,198,920
Shareholders' equity: Series C Preferred Stock - no
par value, 5,200,000 shares outstanding at June 30, 2016, December
31, 2015, and June 30, 2015
125,980 125,980 125,980 Common
stock - $1.00 par value. 124,047,659 shares outstanding at June 30,
2016, 129,547,032 shares outstanding at December 31, 2015 and
132,257,577 shares outstanding at June 30, 2015
141,008
140,592 140,425 Additional paid-in capital
2,993,985
2,989,981 2,981,434 Treasury stock, at cost - 16,959,977 shares at
June 30, 2016, 11,045,377 shares at December 31, 2015, and
8,167,677 shares at June 30, 2015
(573,058 ) (401,511
) (311,859 ) Accumulated other comprehensive gain (loss)
11,005 (29,819 ) (22,323 ) Retained earnings
252,739 174,973 92,500 Total
shareholders' equity
2,951,659 3,000,196
3,006,157 Total liabilities and shareholders'
equity
$ 29,459,691 28,792,653
28,205,078
Synovus
AVERAGE BALANCES AND YIELDS/RATES (1)
(Unaudited) (Dollars in thousands) 2016 2015
Second First Fourth Third Second
Quarter
Quarter Quarter Quarter
Quarter Interest Earning Assets Taxable investment
securities (2)
$ 3,529,030 3,537,131 3,481,184
3,380,543 3,165,513 Yield
1.89 % 1.91 1.85 1.76 1.79
Tax-exempt investment securities (2) (4)
$
3,491 4,091 4,352 4,509 4,595 Yield (taxable equivalent)
6.08 % 6.37 6.16 6.21 6.15 Trading account
assets
$ 3,803 5,216 8,067 7,278 12,564 Yield
1.27 % 1.65 2.24 1.84 3.72 Commercial loans
(3) (4)
$ 18,433,638 18,253,169 17,884,661 17,522,735
17,297,130 Yield
4.04 % 4.03 3.97 3.99 4.01
Consumer loans (3)
$ 4,497,147 4,334,817 4,233,061
4,105,639 3,986,151 Yield
4.32 % 4.37 4.27 4.31 4.37
Allowance for loan losses
$ (251,101 )
(258,097 ) (252,049 )
(256,102 ) (254,177 ) Loans, net (3)
$
22,679,684 22,329,889 21,865,673 21,372,272 21,029,104 Yield
4.15 % 4.15 4.08 4.10 4.14 Mortgage loans held
for sale
$ 72,477 63,339 50,668 69,438 90,419 Yield
3.59 % 3.72 3.84 3.82 3.39
Federal funds sold, due from Federal
Reserve Bank, and other short-term investments
$ 907,615 885,939 1,081,604 1,380,686 1,590,114 Yield
0.47 % 0.47 0.27 0.24 0.24 Federal Home Loan
Bank and Federal Reserve Bank stock (5)
$ 77,571
80,679 66,790 71,852 76,091 Yield
5.15 % 3.82 5.08
4.71 4.57
Total interest earning assets
$ 27,273,670 26,906,284
26,558,338 26,286,578 25,968,400 Yield
3.73 % 3.73 3.63
3.60 3.61
Interest Bearing Liabilities Interest bearing
demand deposits
$ 4,233,310 4,198,738 4,117,116
3,955,803 3,919,401 Rate
0.18 % 0.17 0.17 0.18 0.18
Money market accounts
$ 7,082,759 7,095,778
7,062,517 6,893,563 6,466,610 Rate
0.31 % 0.32 0.35
0.36 0.35 Savings deposits
$ 746,225 722,172
692,536 685,813 675,260 Rate
0.06 % 0.07 0.06 0.06
0.06 Time deposits under $100,000
$ 1,262,280
1,279,811 1,307,601 1,338,994 1,351,299 Rate
0.64 %
0.65 0.65 0.66 0.68 Time deposits over $100,000
$
2,016,116 2,006,302 2,033,193 2,086,851 2,061,434 Rate
0.89 % 0.89 0.88 0.88 0.88 Non maturing
brokered deposits
$ 451,398 315,006 297,925 221,817
185,909 Rate
0.39 % 0.48 0.31 0.31 0.31
Brokered time deposits
$ 885,603 780,232 887,168
1,135,346 1,370,022 Rate
0.85 % 0.83
0.76 0.71 0.67 Total interest bearing
deposits
$ 16,677,691 16,398,039 16,398,056
16,318,187 16,029,935 Rate
0.39 % 0.39 0.40 0.42 0.42
Federal funds purchased and securities
sold under repurchase agreements
$ 221,276 177,921 158,810 207,894 232,531 Rate
0.09 % 0.10 0.08 0.09 0.08 Long-term debt
$ 2,279,043 2,361,973 2,007,924 2,072,455 2,172,765
Rate
2.55 %
2.55 2.63 2.46
2.39 Total interest bearing liabilities
$ 19,178,010 18,937,933 18,564,790 18,598,536
18,435,231 Rate
0.65 %
0.66 0.65
0.65 0.65 Non-interest
bearing demand deposits
$ 6,930,336 6,812,223
6,846,200 6,541,832 6,436,167 Effective cost of funds
0.46 % 0.46
0.45 0.46
0.46 Net interest margin
3.27 % 3.27
3.18 3.14 3.15
Taxable equivalent adjustment
$ 329 305 311
315 330
(1) Yields and rates are annualized.
(2) Excludes net unrealized gains and losses.
(3) Average loans are shown net of unearned income.
Non-performing loans are included.
(4) Reflects taxable-equivalent adjustments, using the statutory
federal income tax rate of 35%, in adjusting interest on tax-exempt
loans and investment securities to a taxable-equivalent basis.
(5) Included as a component of Other Assets on the consolidated
balance sheet.
Synovus LOANS OUTSTANDING AND
NON-PERFORMING LOANS COMPOSITION (Unaudited) (Dollars in
thousands) June 30, 2016
Loans as a % Total
Non-performing Loans of Total Loans Non-performing as
a % of Total Loan Type Total Loans Outstanding
Loans Nonperforming Loans
Multi-Family $ 1,528,192 6.6 % $ 4,070 2.6 % Hotels 746,397 3.2
5,052 3.3 Office Buildings 1,559,631 6.8 2,563 1.7 Shopping Centers
926,147 4.0 358 0.2 Warehouses 535,889 2.3 1,128 0.7 Other
Investment Property 624,405 2.7 978
0.7
Total Investment Properties
5,920,661 25.6 14,149 9.2 1-4 Family Construction
208,871 0.9 304 0.2 1-4 Family Investment Mortgage 758,463 3.3
7,994 5.2 Residential Development 160,446 0.7
9,571 6.2
Total 1-4 Family
Properties 1,127,780 4.9 17,869 11.6
Land
Acquisition 459,254 2.0 7,610
4.9
Total Commercial Real Estate
7,507,695 32.5 39,628
25.7 Commercial, Financial, and Agricultural
6,596,835 28.5 55,821 36.2 Owner-Occupied 4,358,595
18.9 17,118 11.1
Total
Commercial & Industrial 10,955,430 47.4
72,939 47.3 Home Equity
Lines 1,657,109 7.2 16,912 11.0 Consumer Mortgages 2,132,114 9.2
21,895 14.2 Credit Cards 236,034 1.1 - - Other Retail Loans
600,153 2.6 2,698 1.8
Total Retail 4,625,410 20.1
41,505 27.0
Unearned
Income (27,627 ) - - -
Total $ 23,060,908 100.0 % $ 154,072
100.0 %
LOANS OUTSTANDING BY TYPE
COMPARISON (Unaudited) (Dollars in thousands)
Total Loans 2Q16 vs. 1Q16 2Q16
vs. 2Q15 Loan Type
June 30, 2016 March 31, 2016 % change (1)
June 30, 2015 % change Multi-Family $
1,528,192 1,524,850 0.9 % $ 1,286,747 18.8 % Hotels
746,397 718,640 15.5 663,286 12.5 Office Buildings
1,559,631 1,557,608 0.5 1,348,234 15.7 Shopping Centers
926,147 963,520 (15.6 ) 917,678 0.9 Warehouses
535,889 568,662 (23.2 ) 524,525 2.2 Other Investment
Property
624,405 649,865 (15.8 ) 662,924 (5.8 )
Total Investment
Properties 5,920,661 5,983,145 (4.2 ) 5,403,394 9.6
1-4 Family Construction
208,871 211,312 (4.6 )
163,866 27.5 1-4 Family Investment Mortgage
758,463 787,354
(14.8 ) 788,704 (3.8 ) Residential Development
160,446 161,942 (3.7 ) 161,130
(0.4 )
Total 1-4 Family Properties
1,127,780 1,160,608 (11.4 ) 1,113,700 1.3
Land
Acquisition 459,254 469,882
(9.1 ) 554,501 (17.2 )
Total Commercial
Real Estate 7,507,695 7,613,635
(5.6 ) 7,071,595 6.2 Commercial,
Financial, and Agricultural
6,596,835 6,537,253 3.7
6,243,259 5.7 Owner-Occupied
4,358,595
4,272,219 8.1 4,161,268 4.7
Total Commercial & Industrial
10,955,430 10,809,472 5.4
10,404,527 5.3 Home Equity Lines
1,657,109 1,669,406 (3.0 ) 1,683,651 (1.6 ) Consumer
Mortgages
2,132,114 1,970,193 33.1 1,793,752 18.9 Credit
Cards
236,034 232,554 6.0 246,724 (4.3 ) Other Retail Loans
600,153 492,274 88.1
323,741 85.4
Total Retail
4,625,410 4,364,427 24.1
4,047,868 14.3
Unearned Income
(27,627 ) (29,331 ) (23.4 ) (29,121 )
(5.1 )
Total $
23,060,908 22,758,203
5.3 % $ 21,494,869 7.3 % (1) Percentage
change is annualized.
Synovus
CREDIT QUALITY DATA (Unaudited) (Dollars in
thousands)
2016 2015 2nd Quarter
Second First Fourth
Third Second '16 vs. '15
Quarter Quarter
Quarter Quarter Quarter
Change Non-performing Loans
$ 154,072 178,167
168,370 157,640 173,638 (11.3 )% Other Real Estate
33,289 38,462 47,030 64,346 66,449 (49.9 )
Non-performing Assets
187,361 216,629 215,400 221,986
240,087 (22.0 ) Allowance for loan losses
255,076
254,516 252,496 250,900 254,702 0.1 Net Charge-Offs -
Quarter
6,133 7,357 3,425 6,758 5,306 15.6 Net Charge-Offs /
Average Loans - Quarter (1)
0.11 % 0.13 0.06 0.12
0.10 Non-performing Loans / Loans
0.67 0.78 0.75 0.72
0.81 Non-performing Assets / Loans, Other Loans Held for Sale &
ORE
0.81 0.95 0.96 1.01 1.11 Allowance / Loans
1.11
1.12 1.13 1.15 1.18 Allowance / Non-performing Loans
165.56 142.85 149.96 159.16 146.69 Allowance /
Non-performing Loans (2)
195.25 173.64 189.47 205.90 202.08
Past Due Loans over 90 days and Still Accruing $
5,964 3,214 2,621 2,998 4,832 23.4 As a Percentage of Loans
Outstanding
0.03 % 0.01 0.01 0.01 0.02 Total Past Due
Loans and Still Accruing $
55,716 63,852 47,912 39,350
50,860 9.5 As a Percentage of Loans Outstanding
0.24 % 0.28
0.21 0.18 0.24 Accruing Troubled Debt Restructurings (TDRs)
$
205,165 209,159 223,873 240,370 268,542 (23.6 ) (1)
Ratio is annualized. (2) Excludes non-performing loans for which
the expected loss has been charged off.
SELECTED CAPITAL INFORMATION (1)
(Unaudited) (Dollars in thousands)
June 30, 2016 March 31, 2016 June 30, 2015
Tier 1 Capital
$ 2,627,574 2,609,191 2,615,827 Total
Risk-Based Capital
3,146,898 3,183,901 2,971,518 Common
Equity Tier 1 Ratio (transitional)
10.02 % 10.04
10.73 Common Equity Tier 1 Ratio (fully phased-in)
9.49 9.47
10.09 Tier 1 Capital Ratio
10.06 10.04 10.73 Total
Risk-Based Capital Ratio
12.05 12.25 12.18 Tier 1 Leverage
Ratio
9.10 9.15 9.48 Common Equity as a Percentage of Total
Assets (2)
9.59 9.69 10.21 Tangible Common Equity as a
Percentage of Tangible Assets (3)
9.52 9.62 10.13 Tangible
Common Equity as a Percentage of Risk Weighted Assets (3)
10.72 10.78 11.71 Book Value Per Common Share (4)
22.78 22.47 21.78 Tangible Book Value Per Common Share (3)
22.58 22.27 21.59
(1) Current quarter regulatory capital information is
preliminary.
(2) Common equity consists of Total Shareholders' Equity less
Preferred Stock.
(3) Excludes the carrying value of goodwill and other intangible
assets from common equity and total assets.
(4) Book Value Per Common Share consists of Total Shareholders'
Equity less Preferred Stock divided by total common shares
outstanding.
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Synovus Financial Corp.Media
ContactLee Underwood, 706-644-0528Media
RelationsorInvestor ContactBob
May, 706-649-3555Investor Relations
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