First Hawaiian, Inc. Reports Third Quarter 2020 Financial Results and Declares Dividend
10/23/2020 | 08:00am EST
HONOLULU, Oct. 23, 2020 (GLOBE NEWSWIRE) -- First Hawaiian, Inc. (NASDAQ:FHB), (“First Hawaiian” or the “Company”) today reported financial results for its quarter ended September 30, 2020.
“In spite of the current economic environment, we reported solid financial results for the third quarter,” said Bob Harrison, Chairman, President and CEO. “These are still challenging times, but the re-opening of the local economy, and more recently, the pre-testing program for trans-Pacific travel, are important steps toward the state’s economic recovery.”
On October 21, 2020 the Company’s Board of Directors declared a quarterly cash dividend of $0.26 per share. The dividend will be payable on December 4, 2020 to stockholders of record at the close of business on November 23, 2020.
ThirdQuarter 2020Highlights:
Net income of $65.1 million, or $0.50 per diluted share
Net interest income increased $6.2 million, or 4.8% versus prior quarter
Noninterest income increased $3.2 million, or 7.1% versus prior quarter
Consumer and commercial deposits increased $166.0 million and public deposits decreased $629.9 million versus the prior quarter
Net interest margin (“NIM”) was 2.70%, a 12 basis point increase versus the prior quarter
Recorded a $5.1 million provision for credit losses
Board of Directors declared a quarterly dividend of $0.26 per share
Balance Sheet
Total assets were $22.3 billion as of September 30, 2020, compared to $23.0 billion as of June 30, 2020.
Gross loans and leases were $13.5 billion as of September 30, 2020, a decrease of $264.1 million, or 1.9%, from $13.8 billion as of June 30, 2020.
Total deposits were $18.9 billion as of September 30, 2020, a decrease of $463.9 million, or 2.4%, from $19.4 billion as of June 30, 2020.
Net Interest Income
Net interest income for the third quarter of 2020 was $134.0 million, an increase of $6.2 million, or 4.8%, compared to $127.8 million for the prior quarter.
The NIM was 2.70% in the third quarter of 2020, an increase of 12 basis points compared to 2.58% in the second quarter of 2020.
Provision Expense
During the quarter ended September 30, 2020, the Bank recorded a total provision for credit losses of $5.1 million. In the quarter ended June 30, 2020, the total provision for credit losses was $55.4 million.
Noninterest Income
Noninterest income was $48.9 million in the third quarter of 2020, an increase of $3.2 million compared to noninterest income of $45.7 million in the second quarter of 2020.
Noninterest Expense
Noninterest expense was $91.6 million in the third quarter of 2020, essentially unchanged from $91.5 million in the second quarter of 2020.
The efficiency ratio was 50.0% and 52.7% for the quarters ended September 30, 2020 and June 30, 2020, respectively.
Taxes
The effective tax rate was 24.5% for the quarter ended September 30, 2020 and 24.6% for the quarter ended June 30, 2020.
Asset Quality
The allowance for credit losses was $195.9 million, or 1.45% of total loans and leases, as of September 30, 2020, compared to $192.1 million, or 1.40% of total loans and leases, as of June 30, 2020. The reserve for unfunded commitments was $24.6 million as of September 30, 2020 compared to $23.2 million as of June 30, 2020. Net recoveries were $0.1 million, or 0.0% of average loans and leases on an annualized basis for the quarter ended September 30, 2020, compared to $23.4 million, or 0.67% of average loans and leases on an annualized basis for the quarter ended June 30, 2020. Total non-performing assets were $17.6 million, or 0.13% of total loans and leases and other real estate owned, at September 30, 2020, compared to non-performing assets of $33.3 million, or 0.24% of total loans and leases and other real estate owned, at June 30, 2020.
Capital
Total stockholders' equity was $2.7 billion at both September 30 and June 30, 2020.
The tier 1 leverage, common equity tier 1 and total capital ratios were 7.91%, 12.22% and 13.47%, respectively, at September 30, 2020, compared with 7.75%, 11.86% and 13.11%, respectively, at June 30, 2020.
The Company suspended its stock repurchase program during the first quarter and did not repurchase any shares of common stock in the third quarter.
First Hawaiian, Inc.
First Hawaiian, Inc. (NASDAQ:FHB) is a bank holding company headquartered in Honolulu, Hawaii. Its principal subsidiary, First Hawaiian Bank, founded in 1858 under the name Bishop & Company, is Hawaii’s oldest and largest financial institution with branch locations throughout Hawaii, Guam and Saipan. The company offers a comprehensive suite of banking services to consumer and commercial customers including deposit products, loans, wealth management, insurance, trust, retirement planning, credit card and merchant processing services. Customers may also access their accounts through ATMs, online and mobile banking channels. For more information about First Hawaiian, Inc., visit the Company’s website, www.fhb.com.
Conference Call Information
First Hawaiian will host a conference call to discuss the Company’s results today at 1:00 p.m. Eastern Time, 7:00 a.m. Hawaii Time. To access the call, participants should dial (844) 452-2942 (US/Canada), or (574) 990-9846 (International) ten minutes prior to the start of the call and enter the conference ID: 5358159. A live webcast of the conference call, including a slide presentation, will be available at the following link: www.fhb.com/earnings. The archive of the webcast will be available at the same location. A telephonic replay of the conference call will be available two hours after the conclusion of the call until 4:30 p.m. (Eastern Time) on October 30, 2020. Access the replay by dialing (855) 859-2056 or (404) 537-3406 and entering the conference ID: 5358159.
Forward-Looking Statements This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. These statements are often, but not always, made through the use of words or phrases such as “may”, “might”, “should”, “could”, “predict”, “potential”, “believe”, “expect”, “continue”, “will”, “anticipate”, “seek”, “estimate”, “intend”, “plan”, “projection”, “would”, “annualized” and “outlook”, or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management's beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, estimates and uncertainties that are difficult to predict. Further, statements about the potential effects of the COVID-19 pandemic on our businesses and financial results and conditions may constitute forward-looking statements and are subject to the risk that the actual effects may differ, possibly materially, from what is reflected in those forward-looking statements due to factors and future developments that are uncertain, unpredictable and in many cases beyond our control, including the scope and duration of the pandemic, actions taken by governmental authorities in response to the pandemic, and the direct and indirect impact of the pandemic on our customers, third parties and us. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, there can be no assurance that actual results will not prove to be materially different from the results expressed or implied by the forward-looking statements. A number of important factors could cause actual results or performance to differ materially from the forward-looking statements, including (without limitation) the risks and uncertainties associated with the ongoing impacts of COVID-19, the domestic and global economic environment and capital market conditions and other risk factors. For a discussion of some of these risks and important factors that could affect our future results and financial condition, see our U.S. Securities and Exchange Commission (“SEC”) filings, including, but not limited to, our Annual Report on Form 10-K for the year ended December 31, 2019 and our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2020 and June 30, 2020.
Use of Non-GAAP Financial Measures
We present net interest income, noninterest income, noninterest expense, net income, earnings per share (basic and diluted) and the related ratios described below, on an adjusted, or ‘‘core,’’ basis, each a non-GAAP financial measure. These core measures exclude from the corresponding GAAP measure the impact of certain items that we do not believe are representative of our financial results. We believe that the presentation of these non-GAAP financial measures helps identify underlying trends in our business from period to period that could otherwise be distorted by the effect of certain expenses, gains and other items included in our operating results. We believe that these core measures provide useful information about our operating results and enhance the overall understanding of our past performance and future performance. Investors should consider our performance and financial condition as reported under GAAP and all other relevant information when assessing our performance or financial condition.
Core net interest margin, core efficiency ratio, core return on average total assets and core return on average total stockholders’ equity are non-GAAP financial measures. We compute our core net interest margin as the ratio of core net interest income to average earning assets. We compute our core efficiency ratio as the ratio of core noninterest expense to the sum of core net interest income and core noninterest income. We compute our core return on average total assets as the ratio of core net income to average total assets. We compute our core return on average total stockholders’ equity as the ratio of core net income to average total stockholders’ equity.
Return on average tangible stockholders’ equity, core return on average tangible stockholders’ equity, return on average tangible assets, core return on average tangible assets and tangible stockholders’ equity to tangible assets are non-GAAP financial measures. We compute our return on average tangible stockholders’ equity as the ratio of net income to average tangible stockholders’ equity, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total stockholders’ equity. We compute our core return on average tangible stockholders’ equity as the ratio of core net income to average tangible stockholders’ equity, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total stockholders’ equity. We compute our return on average tangible assets as the ratio of net income to average tangible assets, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total assets. We compute our core return on average tangible assets as the ratio of core net income to average tangible assets. We compute our tangible stockholders’ equity to tangible assets as the ratio of tangible stockholders’ equity to tangible assets, each of which we calculate by subtracting (and thereby effectively excluding) the value of our goodwill. We believe that these measurements are useful for investors, regulators, management and others to evaluate financial performance and capital adequacy relative to other financial institutions. Although these non-GAAP financial measures are frequently used by stakeholders in the evaluation of a company, they have limitations as analytical tools and should not be considered in isolation or as a substitute for analysis of our results or financial condition as reported under GAAP.
Tables 14 and 15 at the end of this document provide a reconciliation of these non-GAAP financial measures with their most directly comparable GAAP measures.
Investor Relations Contact: Kevin Haseyama, CFA (808) 525-6268 khaseyama@fhb.com
Media Contact: Susan Kam (808) 525-6254 skam@fhb.com
Financial Highlights
Table 1
For the Three Months Ended
For the Nine Months Ended
September 30,
June 30,
September 30,
September 30,
(dollars in thousands, except per share data)
2020
2020
2019
2020
2019
Operating Results:
Net interest income
$
134,002
$
127,822
$
143,081
$
400,507
$
433,783
Provision for credit losses
5,072
55,446
—
101,718
9,550
Noninterest income
48,898
45,656
49,980
143,782
145,825
Noninterest expense
91,629
91,450
93,466
279,545
279,379
Net income
65,101
20,049
74,199
124,015
216,556
Basic earnings per share
0.50
0.15
0.56
0.95
1.62
Diluted earnings per share
0.50
0.15
0.56
0.95
1.61
Dividends declared per share
0.26
0.26
0.26
0.78
0.78
Dividend payout ratio
52.00
%
173.33
%
46.43
%
82.11
%
48.45
%
Supplemental Income Statement Data (non-GAAP):
Core net interest income
$
134,002
$
127,822
$
143,081
$
400,507
$
433,783
Core noninterest income
48,874
45,867
49,980
143,884
148,417
Core noninterest expense
91,629
91,450
91,222
279,545
276,613
Core net income
65,083
20,204
75,871
124,090
220,535
Core basic earnings per share
0.50
0.16
0.57
0.96
1.65
Core diluted earnings per share
0.50
0.16
0.57
0.95
1.64
Performance Ratio(1):
Net interest margin
2.70
%
2.58
%
3.19
%
2.79
%
3.22
%
Core net interest margin (non-GAAP)
2.70
%
2.58
%
3.19
%
2.79
%
3.22
%
Efficiency ratio
50.01
%
52.70
%
48.41
%
51.32
%
48.20
%
Core efficiency ratio (non-GAAP)
50.02
%
52.64
%
47.25
%
51.31
%
47.51
%
Return on average total assets
1.16
%
0.36
%
1.45
%
0.76
%
1.42
%
Core return on average total assets (non-GAAP)
1.16
%
0.36
%
1.48
%
0.76
%
1.44
%
Return on average tangible assets (non-GAAP)
1.21
%
0.38
%
1.52
%
0.80
%
1.49
%
Core return on average tangible assets (non-GAAP)(2)
1.21
%
0.38
%
1.56
%
0.80
%
1.52
%
Return on average total stockholders' equity
9.58
%
2.99
%
11.12
%
6.16
%
11.13
%
Core return on average total stockholders' equity (non-GAAP)
9.57
%
3.01
%
11.37
%
6.17
%
11.34
%
Return on average tangible stockholders' equity (non-GAAP)
15.16
%
4.74
%
17.81
%
9.79
%
18.04
%
Core return on average tangible stockholders’ equity (non-GAAP)(3)
15.15
%
4.77
%
18.21
%
9.80
%
18.37
%
Average Balances:
Average loans and leases
$
13,559,367
$
13,956,669
$
13,032,349
$
13,569,119
$
13,105,086
Average earning assets
19,846,674
19,854,795
17,862,564
19,174,349
17,974,363
Average assets
22,341,485
22,341,654
20,332,457
21,667,948
20,405,261
Average deposits
18,892,033
18,540,394
16,573,796
17,995,196
16,700,366
Average stockholders' equity
2,704,129
2,697,775
2,648,428
2,687,632
2,600,259
Market Value Per Share:
Closing
14.47
17.24
26.70
14.47
26.70
High
18.96
21.50
27.84
31.25
28.20
Low
14.32
13.56
24.25
13.56
22.13
As of
As of
As of
As of
September 30,
June 30,
December 31,
September 30,
2020
2020
2019
2019
Balance Sheet Data:
Loans and leases
$
13,499,969
$
13,764,030
$
13,211,650
$
12,843,396
Total assets
22,310,701
22,993,715
20,166,734
20,598,220
Total deposits
18,897,762
19,361,634
16,444,994
16,857,246
Short-term borrowings
—
200,000
400,000
400,000
Long-term borrowings
200,010
200,019
200,019
200,018
Total stockholders' equity
2,733,934
2,701,897
2,640,258
2,654,558
Per Share of Common Stock:
Book value
$
21.04
$
20.81
$
20.32
$
20.22
Tangible book value (non-GAAP)(4)
13.38
13.14
12.66
12.64
Asset Quality Ratios:
Non-accrual loans and leases / total loans and leases
0.13
%
0.24
%
0.04
%
0.03
%
Allowance for credit losses for loans and leases / total loans and leases
1.45
%
1.40
%
0.99
%
1.04
%
Capital Ratios:
Common Equity Tier 1 Capital Ratio
12.22
%
11.86
%
11.88
%
12.15
%
Tier 1 Capital Ratio
12.22
%
11.86
%
11.88
%
12.15
%
Total Capital Ratio
13.47
%
13.11
%
12.81
%
13.11
%
Tier 1 Leverage Ratio
7.91
%
7.75
%
8.79
%
8.68
%
Total stockholders' equity to total assets
12.25
%
11.75
%
13.09
%
12.89
%
Tangible stockholders' equity to tangible assets (non-GAAP)
8.16
%
7.76
%
8.58
%
8.46
%
Non-Financial Data:
Number of branches
58
58
58
58
Number of ATMs
302
295
301
293
Number of Full-Time Equivalent Employees
2,099
2,100
2,092
2,099
(1)
Except for the efficiency ratio and the core efficiency ratio, amounts are annualized for the three and nine months ended September 30, 2020 and 2019 and the three months ended June 30, 2020.
(2)
Core return on average tangible assets is a non-GAAP financial measure. We compute our core return on average tangible assets as the ratio of core net income to average tangible assets, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total assets. For a reconciliation to the most directly comparable GAAP financial measure for core net income, see Table 14, GAAP to Non-GAAP Reconciliation.
(3)
Core return on average tangible stockholders’ equity is a non-GAAP financial measure. We compute our core return on average tangible stockholders’ equity as the ratio of core net income to average tangible stockholders’ equity, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total stockholders’ equity. For a reconciliation to the most directly comparable GAAP financial measure for core net income, see Table 14, GAAP to Non-GAAP Reconciliation.
(4)
Tangible book value is a non-GAAP financial measure. We compute our tangible book value as the ratio of tangible stockholders’ equity to shares outstanding. Tangible stockholders’ equity is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our total stockholders’ equity. For a reconciliation to the most directly comparable GAAP financial measure for core net income, see Table 14, GAAP to Non-GAAP Reconciliation.
Consolidated Statements of Income
Table 2
For the Three Months Ended
For the Nine Months Ended
September 30,
June 30,
September 30,
September 30,
(dollars in thousands, except per share amounts)
2020
2020
2019
2020
2019
Interest income
Loans and lease financing
$
120,940
$
122,298
$
144,691
$
378,209
$
435,980
Available-for-sale securities
20,317
17,529
22,256
59,056
71,526
Other
670
792
3,234
3,813
9,054
Total interest income
141,927
140,619
170,181
441,078
516,560
Interest expense
Deposits
6,227
8,583
22,753
30,410
69,643
Short-term and long-term borrowings
1,698
4,214
4,347
10,161
13,134
Total interest expense
7,925
12,797
27,100
40,571
82,777
Net interest income
134,002
127,822
143,081
400,507
433,783
Provision for credit losses
5,072
55,446
—
101,718
9,550
Net interest income after provision for credit losses
128,930
72,376
143,081
298,789
424,233
Noninterest income
Service charges on deposit accounts
6,523
5,927
8,554
21,400
24,737
Credit and debit card fees
14,049
10,870
16,839
39,868
50,123
Other service charges and fees
9,021
7,912
8,903
25,472
27,435
Trust and investment services income
8,664
8,664
8,698
26,919
26,247
Bank-owned life insurance
4,903
4,432
5,743
11,595
12,946
Investment securities gains (losses), net
24
(211
)
—
(102
)
(2,592
)
Other
5,714
8,062
1,243
18,630
6,929
Total noninterest income
48,898
45,656
49,980
143,782
145,825
Noninterest expense
Salaries and employee benefits
44,291
42,414
44,955
131,534
132,000
Contracted services and professional fees
15,073
15,478
14,649
46,606
42,597
Occupancy
6,921
7,302
7,250
21,466
21,522
Equipment
5,137
5,207
4,024
15,052
12,852
Regulatory assessment and fees
2,445
2,100
1,992
6,491
5,588
Advertising and marketing
1,374
1,402
1,647
4,599
5,593
Card rewards program
5,046
5,163
6,930
17,224
21,326
Other
11,342
12,384
12,019
36,573
37,901
Total noninterest expense
91,629
91,450
93,466
279,545
279,379
Income before provision for income taxes
86,199
26,582
99,595
163,026
290,679
Provision for income taxes
21,098
6,533
25,396
39,011
74,123
Net income
$
65,101
$
20,049
$
74,199
$
124,015
$
216,556
Basic earnings per share
$
0.50
$
0.15
$
0.56
$
0.95
$
1.62
Diluted earnings per share
$
0.50
$
0.15
$
0.56
$
0.95
$
1.61
Basic weighted-average outstanding shares
129,896,054
129,856,730
132,583,902
129,882,878
133,957,192
Diluted weighted-average outstanding shares
130,085,534
130,005,195
132,877,769
130,129,690
134,231,762
Consolidated Balance Sheets
Table 3
September 30,
June 30,
December 31,
September 30,
(dollars in thousands)
2020
2020
2019
2019
Assets
Cash and due from banks
$
333,744
$
347,592
$
360,375
$
358,863
Interest-bearing deposits in other banks
482,585
1,507,630
333,642
985,154
Investment securities, at fair value (amortized cost: $5,584,556 as of September 30, 2020, $5,025,433 as of June 30, 2020, $4,080,663 as of December 31, 2019 and $4,143,124 as of September 30, 2019)
5,692,883
5,135,775
4,075,644
4,157,082
Loans held for sale
34,669
6,698
904
1,594
Loans and leases
13,499,969
13,764,030
13,211,650
12,843,396
Less: allowance for credit losses
195,876
192,120
130,530
132,964
Net loans and leases
13,304,093
13,571,910
13,081,120
12,710,432
Premises and equipment, net
321,229
322,919
316,885
315,309
Other real estate owned and repossessed personal property
—
446
319
82
Accrued interest receivable
66,005
58,420
45,239
44,671
Bank-owned life insurance
462,422
458,720
453,873
453,410
Goodwill
995,492
995,492
995,492
995,492
Mortgage servicing rights
10,922
11,595
12,668
13,630
Other assets
606,657
576,518
490,573
562,501
Total assets
$
22,310,701
$
22,993,715
$
20,166,734
$
20,598,220
Liabilities and Stockholders' Equity
Deposits:
Interest-bearing
$
11,989,492
$
12,481,543
$
10,564,922
$
11,136,424
Noninterest-bearing
6,908,270
6,880,091
5,880,072
5,720,822
Total deposits
18,897,762
19,361,634
16,444,994
16,857,246
Short-term borrowings
—
200,000
400,000
400,000
Long-term borrowings
200,010
200,019
200,019
200,018
Retirement benefits payable
138,806
138,624
138,222
128,442
Other liabilities
340,189
391,541
343,241
357,956
Total liabilities
19,576,767
20,291,818
17,526,476
17,943,662
Stockholders' equity
Common stock ($0.01 par value; authorized 300,000,000 shares; issued/outstanding: 140,190,428 / 129,911,789 shares as of September 30, 2020, issued/outstanding: 140,140,542 / 129,866,898 shares as of June 30, 2020, issued/outstanding: 139,917,150 / 129,928,479 shares as of December 31, 2019 and issued/outstanding: 139,908,699 / 131,260,900 shares as of September 30, 2019)
1,402
1,401
1,399
1,399
Additional paid-in capital
2,511,849
2,509,271
2,503,677
2,501,324
Retained earnings
446,315
415,296
437,072
403,317
Accumulated other comprehensive income (loss), net
51,254
52,731
(31,749
)
(18,774
)
Treasury stock (10,278,639 shares as of September 30, 2020, 10,273,644 shares as of June 30, 2020, 9,988,671 shares as of December 31, 2019 and 8,647,799 shares as of September 30, 2019)
(276,886
)
(276,802
)
(270,141
)
(232,708
)
Total stockholders' equity
2,733,934
2,701,897
2,640,258
2,654,558
Total liabilities and stockholders' equity
$
22,310,701
$
22,993,715
$
20,166,734
$
20,598,220
Average Balances and Interest Rates
Table 4
Three Months Ended
Three Months Ended
Three Months Ended
September 30, 2020
June 30, 2020
September 30, 2019
Average
Income/
Yield/
Average
Income/
Yield/
Average
Income/
Yield/
(dollars in millions)
Balance
Expense
Rate
Balance
Expense
Rate
Balance
Expense
Rate
Earning Assets
Interest-Bearing Deposits in Other Banks
$
889.6
$
0.2
0.10
%
$
1,436.2
$
0.4
0.10
%
$
447.8
$
2.3
2.02
%
Available-for-Sale Investment Securities
5,334.2
20.3
1.53
4,390.4
17.5
1.60
4,296.3
22.3
2.07
Loans Held for Sale
10.2
0.1
2.67
9.8
0.1
2.93
1.4
—
2.36
Loans and Leases(1)
Commercial and industrial
3,230.4
21.6
2.67
3,601.0
24.3
2.71
2,885.9
30.0
4.12
Commercial real estate
3,418.0
27.8
3.23
3,438.8
28.3
3.31
3,294.7
37.3
4.49
Construction
637.6
5.2
3.22
584.1
4.9
3.35
477.2
5.6
4.67
Residential:
Residential mortgage
3,680.5
37.9
4.12
3,682.7
35.7
3.88
3,644.9
38.6
4.23
Home equity line
871.1
6.6
3.02
885.2
6.8
3.07
912.8
8.6
3.74
Consumer
1,474.4
20.2
5.46
1,526.5
20.6
5.42
1,651.4
23.3
5.61
Lease financing
247.4
1.8
2.90
238.4
1.7
2.88
165.4
1.3
3.14
Total Loans and Leases
13,559.4
121.1
3.56
13,956.7
122.3
3.52
13,032.3
144.7
4.41
Other Earning Assets
53.3
0.5
3.32
61.7
0.4
2.79
84.8
0.9
4.47
Total Earning Assets(2)
19,846.7
142.2
2.86
19,854.8
140.7
2.84
17,862.6
170.2
3.79
Cash and Due from Banks
307.9
295.1
341.7
Other Assets
2,186.9
2,191.8
2,128.2
Total Assets
$
22,341.5
$
22,341.7
$
20,332.5
Interest-Bearing Liabilities
Interest-Bearing Deposits
Savings
$
5,768.3
$
0.6
0.04
%
$
5,501.9
$
0.9
0.07
%
4,891.5
$
4.6
0.37
%
Money Market
3,288.2
0.4
0.05
3,270.3
1.1
0.13
3,067.4
7.1
0.92
Time
3,029.8
5.2
0.69
3,335.6
6.6
0.79
2,872.6
11.1
1.54
Total Interest-Bearing Deposits
12,086.3
6.2
0.20
12,107.8
8.6
0.29
10,831.5
22.8
0.83
Short-Term Borrowings
45.1
0.3
2.69
395.6
2.8
2.88
370.0
2.6
2.84
Long-Term Borrowings
200.0
1.4
2.77
200.0
1.4
2.77
239.1
1.7
2.82
Total Interest-Bearing Liabilities
12,331.4
7.9
0.26
12,703.4
12.8
0.41
11,440.6
27.1
0.94
Net Interest Income
$
134.3
$
127.9
$
143.1
Interest Rate Spread
2.60
%
2.43
%
2.85
%
Net Interest Margin
2.70
%
2.58
%
3.19
%
Noninterest-Bearing Demand Deposits
6,805.7
6,432.6
5,742.3
Other Liabilities
500.3
507.9
501.2
Stockholders' Equity
2,704.1
2,697.8
2,648.4
Total Liabilities and Stockholders' Equity
$
22,341.5
$
22,341.7
$
20,332.5
(1)
Non-performing loans and leases are included in the respective average loan and lease balances. Income, if any, on such loans and leases is recognized on a cash basis.
(2)
Interest income includes taxable-equivalent basis adjustments of $0.3 million, $0.1 million and nil for the three months ended September 30, 2020, June 30, 2020 and September 30, 2019, respectively.
Average Balances and Interest Rates
Table 5
Nine Months Ended
Nine Months Ended
September 30, 2020
September 30, 2019
Average
Income/
Yield/
Average
Income/
Yield/
(dollars in millions)
Balance
Expense
Rate
Balance
Expense
Rate
Earning Assets
Interest-Bearing Deposits in Other Banks
$
947.3
$
2.2
0.31
%
$
400.6
$
6.9
2.31
%
Available-for-Sale Investment Securities
4,588.7
59.1
1.72
4,383.6
71.5
2.18
Loans Held for Sale
11.9
0.2
2.31
0.8
—
2.52
Loans and Leases(1)
Commercial and industrial
3,202.4
70.5
2.94
3,094.8
97.5
4.21
Commercial real estate
3,423.9
90.7
3.54
3,129.8
108.1
4.62
Construction
586.9
15.8
3.59
565.2
20.0
4.73
Residential:
Residential mortgage
3,700.8
111.3
4.01
3,590.2
112.4
4.17
Home equity line
881.2
21.1
3.20
912.4
25.9
3.79
Consumer
1,537.5
63.9
5.55
1,658.7
68.5
5.52
Lease financing
236.4
5.1
2.90
154.0
3.6
3.15
Total Loans and Leases
13,569.1
378.4
3.72
13,105.1
436.0
4.44
Other Earning Assets
57.3
1.6
3.78
84.3
2.2
3.37
Total Earning Assets(2)
19,174.3
441.5
3.07
17,974.4
516.6
3.84
Cash and Due from Banks
310.1
348.1
Other Assets
2,183.5
2,082.8
Total Assets
$
21,667.9
$
20,405.3
Interest-Bearing Liabilities
Interest-Bearing Deposits
Savings
$
5,454.7
$
4.7
0.12
%
$
4,806.0
$
12.8
0.35
%
Money Market
3,208.1
6.1
0.25
3,125.5
22.1
0.95
Time
2,966.9
19.6
0.88
2,999.0
34.8
1.55
Total Interest-Bearing Deposits
11,629.7
30.4
0.35
10,930.5
69.7
0.85
Short-Term Borrowings
279.9
6.0
2.87
145.7
3.0
2.76
Long-Term Borrowings
200.0
4.2
2.77
476.2
10.1
2.84
Total Interest-Bearing Liabilities
12,109.6
40.6
0.45
11,552.4
82.8
0.96
Net Interest Income
$
400.9
$
433.8
Interest Rate Spread
2.62
%
2.88
%
Net Interest Margin
2.79
%
3.22
%
Noninterest-Bearing Demand Deposits
6,365.5
5,769.9
Other Liabilities
505.2
482.7
Stockholders' Equity
2,687.6
2,600.3
Total Liabilities and Stockholders' Equity
$
21,667.9
$
20,405.3
(1)
Non-performing loans and leases are included in the respective average loan and lease balances. Income, if any, on such loans and leases is recognized on a cash basis.
(2)
Interest income includes taxable-equivalent basis adjustments of $0.4 million and nil for the nine months ended September 30, 2020 and 2019, respectively.
Analysis of Change in Net Interest Income
Table 6
Three Months Ended September 30, 2020
Compared to June 30, 2020
(dollars in millions)
Volume
Rate
Total
Change in Interest Income:
Interest-Bearing Deposits in Other Banks
$
(0.2
)
$
—
$
(0.2
)
Available-for-Sale Investment Securities
3.6
(0.8
)
2.8
Loans and Leases
Commercial and industrial
(2.3
)
(0.4
)
(2.7
)
Commercial real estate
(0.1
)
(0.4
)
(0.5
)
Construction
0.5
(0.2
)
0.3
Residential:
Residential mortgage
—
2.2
2.2
Home equity line
(0.1
)
(0.1
)
(0.2
)
Consumer
(0.6
)
0.2
(0.4
)
Lease financing
0.1
—
0.1
Total Loans and Leases
(2.5
)
1.3
(1.2
)
Other Earning Assets
—
0.1
0.1
Total Change in Interest Income
0.9
0.6
1.5
Change in Interest Expense:
Interest-Bearing Deposits
Savings
0.1
(0.4
)
(0.3
)
Money Market
—
(0.7
)
(0.7
)
Time
(0.6
)
(0.8
)
(1.4
)
Total Interest-Bearing Deposits
(0.5
)
(1.9
)
(2.4
)
Short-Term Borrowings
(2.3
)
(0.2
)
(2.5
)
Total Change in Interest Expense
(2.8
)
(2.1
)
(4.9
)
Change in Net Interest Income
$
3.7
$
2.7
$
6.4
Analysis of Change in Net Interest Income
Table 7
Three Months Ended September 30, 2020
Compared to September 30, 2019
(dollars in millions)
Volume
Rate
Total
Change in Interest Income:
Interest-Bearing Deposits in Other Banks
$
1.1
$
(3.2
)
$
(2.1
)
Available-for-Sale Investment Securities
4.6
(6.6
)
(2.0
)
Loans Held for Sale
0.1
—
0.1
Loans and Leases
Commercial and industrial
3.2
(11.6
)
(8.4
)
Commercial real estate
1.3
(10.8
)
(9.5
)
Construction
1.6
(2.0
)
(0.4
)
Residential:
Residential mortgage
0.4
(1.1
)
(0.7
)
Home equity line
(0.4
)
(1.6
)
(2.0
)
Consumer
(2.5
)
(0.6
)
(3.1
)
Lease financing
0.6
(0.1
)
0.5
Total Loans and Leases
4.2
(27.8
)
(23.6
)
Other Earning Assets
(0.3
)
(0.1
)
(0.4
)
Total Change in Interest Income
9.7
(37.7
)
(28.0
)
Change in Interest Expense:
Interest-Bearing Deposits
Savings
0.7
(4.7
)
(4.0
)
Money Market
0.4
(7.1
)
(6.7
)
Time
0.6
(6.5
)
(5.9
)
Total Interest-Bearing Deposits
1.7
(18.3
)
(16.6
)
Short-Term Borrowings
(2.2
)
(0.1
)
(2.3
)
Long-Term Borrowings
(0.3
)
—
(0.3
)
Total Change in Interest Expense
(0.8
)
(18.4
)
(19.2
)
Change in Net Interest Income
$
10.5
$
(19.3
)
$
(8.8
)
Analysis of Change in Net Interest Income
Table 8
Nine Months Ended September 30, 2020
Compared to September 30, 2019
(dollars in millions)
Volume
Rate
Total
Change in Interest Income:
Interest-Bearing Deposits in Other Banks
$
4.5
$
(9.2
)
$
(4.7
)
Available-for-Sale Investment Securities
3.2
(15.6
)
(12.4
)
Loans Held for Sale
0.2
—
0.2
Loans and Leases
Commercial and industrial
3.3
(30.3
)
(27.0
)
Commercial real estate
9.5
(26.9
)
(17.4
)
Construction
0.8
(5.0
)
(4.2
)
Residential:
Residential mortgage
3.3
(4.4
)
(1.1
)
Home equity line
(0.9
)
(3.9
)
(4.8
)
Consumer
(5.0
)
0.4
(4.6
)
Lease financing
1.8
(0.3
)
1.5
Total Loans and Leases
12.8
(70.4
)
(57.6
)
Other Earning Assets
(0.8
)
0.2
(0.6
)
Total Change in Interest Income
19.9
(95.0
)
(75.1
)
Change in Interest Expense:
Interest-Bearing Deposits
Savings
1.4
(9.5
)
(8.1
)
Money Market
0.6
(16.6
)
(16.0
)
Time
(0.4
)
(14.8
)
(15.2
)
Total Interest-Bearing Deposits
1.6
(40.9
)
(39.3
)
Short-Term Borrowings
2.9
0.1
3.0
Long-Term Borrowings
(5.7
)
(0.2
)
(5.9
)
Total Change in Interest Expense
(1.2
)
(41.0
)
(42.2
)
Change in Net Interest Income
$
21.1
$
(54.0
)
$
(32.9
)
Loans and Leases
Table 9
September 30,
June 30,
December 31,
September 30,
(dollars in thousands)
2020
2020
2019
2019
Commercial and industrial
$
3,170,262
$
3,423,708
$
2,743,242
$
2,654,077
Commercial real estate
3,461,085
3,423,499
3,463,953
3,309,389
Construction
662,871
617,935
519,241
486,977
Residential:
Residential mortgage
3,669,051
3,691,950
3,768,936
3,671,424
Home equity line
864,789
876,491
893,239
916,106
Total residential
4,533,840
4,568,441
4,662,175
4,587,530
Consumer
1,425,934
1,492,160
1,620,556
1,637,549
Lease financing
245,977
238,287
202,483
167,874
Total loans and leases
$
13,499,969
$
13,764,030
$
13,211,650
$
12,843,396
Deposits
Table 10
September 30,
June 30,
December 31,
September 30,
(dollars in thousands)
2020
2020
2019
2019
Demand
$
6,908,270
$
6,880,091
$
5,880,072
$
5,720,822
Savings
5,994,687
5,727,367
4,998,933
4,899,468
Money Market
3,379,985
3,247,511
3,055,832
3,529,363
Time
2,614,820
3,506,665
2,510,157
2,707,593
Total Deposits
$
18,897,762
$
19,361,634
$
16,444,994
$
16,857,246
Non-Performing Assets and Accruing Loans and Leases Past Due 90 Days or More
Table 11
September 30,
June 30,
December 31,
September 30,
(dollars in thousands)
2020
2020
2019
2019
Non-Performing Assets
Non-Accrual Loans and Leases
Commercial Loans:
Commercial and industrial
$
725
$
11,559
$
32
$
12
Commercial real estate
7,067
13,168
30
33
Construction
2,043
2,043
—
—
Total Commercial Loans
9,835
26,770
62
45
Residential Loans:
Residential mortgage
7,798
6,059
5,406
3,959
Total Residential Loans
7,798
6,059
5,406
3,959
Consumer
—
—
—
200
Total Non-Accrual Loans and Leases
17,633
32,829
5,468
4,204
Other Real Estate Owned
—
446
319
82
Total Non-Performing Assets
$
17,633
$
33,275
$
5,787
$
4,286
Accruing Loans and Leases Past Due 90 Days or More
Commercial Loans:
Commercial and industrial
$
1,938
$
2,309
$
1,429
$
750
Commercial real estate
1,307
900
1,013
—
Construction
100
248
2,367
—
Total Commercial Loans
3,345
3,457
4,809
750
Residential Loans:
Residential mortgage
—
—
74
139
Home equity line
4,503
4,496
2,995
3,192
Total Residential Loans
4,503
4,496
3,069
3,331
Consumer
2,897
2,167
4,272
3,076
Total Accruing Loans and Leases Past Due 90 Days or More
$
10,745
$
10,120
$
12,150
$
7,157
Restructured Loans on Accrual Status and Not Past Due 90 Days or More
$
9,726
$
11,182
$
14,493
$
22,350
Total Loans and Leases
$
13,499,969
$
13,764,030
$
13,211,650
$
12,843,396
Allowance for Credit Losses
Table 12
For the Three Months Ended
For the Nine Months Ended
September 30,
June 30,
September 30,
September 30,
September 30,
(dollars in thousands)
2020
2020
2019
2020
2019
Balance at Beginning of Period
$
192,120
$
166,013
$
138,535
$
130,530
$
141,718
Adjustment to Adopt ASC Topic 326
—
—
—
770
—
After Adoption of ASC Topic 326
192,120
166,013
138,535
131,300
141,718
Loans and Leases Charged-Off
Commercial Loans:
Commercial and industrial
(598
)
(13,974
)
(514
)
(14,773
)
(2,514
)
Commercial real estate
—
(2,723
)
—
(2,723
)
—
Construction
—
(379
)
—
(379
)
—
Lease financing
—
—
—
—
(24
)
Total Commercial Loans
(598
)
(17,076
)
(514
)
(17,875
)
(2,538
)
Residential Loans:
Residential mortgage
—
(14
)
(7
)
(14
)
(7
)
Home equity line
—
—
—
(8
)
—
Total Residential Loans
—
(14
)
(7
)
(22
)
(7
)
Consumer
(4,238
)
(8,907
)
(8,015
)
(21,742
)
(24,118
)
Total Loans and Leases Charged-Off
(4,836
)
(25,997
)
(8,536
)
(39,639
)
(26,663
)
Recoveries on Loans and Leases Previously Charged-Off
Commercial Loans:
Commercial and industrial
1,699
100
241
2,019
303
Commercial real estate
—
—
30
—
93
Construction
30
30
—
170
—
Total Commercial Loans
1,729
130
271
2,189
396
Residential Loans:
Residential mortgage
27
17
368
179
704
Home equity line
16
8
57
146
156
Total Residential Loans
43
25
425
325
860
Consumer
3,148
2,456
2,269
7,687
7,103
Total Recoveries on Loans and Leases Previously Charged-Off
4,920
2,611
2,965
10,201
8,359
Net Loans and Leases Recovered (Charged-Off)
84
(23,386
)
(5,571
)
(29,438
)
(18,304
)
Provision for Credit Losses - Loans and Leases
3,672
49,493
—
94,014
9,550
Balance at End of Period
$
195,876
$
192,120
$
132,964
$
195,876
$
132,964
Average Loans and Leases Outstanding
$
13,559,367
$
13,956,669
$
13,032,349
$
13,569,119
$
13,105,086
Ratio of Net Loans and Leases Charged-Off to Average Loans and Leases Outstanding(1)
-
%
0.67
%
0.17
%
0.29
%
0.19
%
Ratio of Allowance for Credit Losses for Loans and Leases to Loans and Leases Outstanding
1.45
%
1.40
%
1.04
%
1.45
%
1.04
%
(1)
Annualized for the three and nine months ended September 30, 2020 and 2019 and three months ended June 30, 2020.
Loans and Leases by Year of Origination and Credit Quality Indicator
Canada
Deutschland
España
France
Italia
Schweiz (DE)
United Kingdom
Report
