Market Overview

Glacier Bancorp, Inc. Announces Results for the Quarter Ended March 31, 2016

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HIGHLIGHTS:

  • Net income of $28.7 million for the current quarter, an increase of 4 percent over the prior year first quarter net income of $27.7 million.
  • Current quarter diluted earnings per share of $0.38, an increase of 3 percent from the prior year first quarter diluted earnings per share of $0.37.
  • Loan growth of $119 million, or 9 percent annualized for the current quarter.
  • Net interest margin of 4.01 percent as a percentage of earning assets, on a tax equivalent basis, for the current quarter.
  • Dividend declared of $0.20 per share, an increase of $0.01 per share, or 5 percent, over the prior quarter.  The dividend was the 124th consecutive quarterly dividend declared by the Company.
  • The Company successfully completed the first phase of the consolidation of its bank divisions' core database systems into our new "Gold Bank" core database system.
  • The Company yesterday announced the signing of a definitive agreement to acquire Treasure State Bank, a community bank based in Missoula, Montana.  As of December, 31, 2015, Treasure State Bank had total assets of $71 million, total loans of $53 million and total deposits of $58 million.

Financial Highlights

 At or for the Three Months ended
(Dollars in thousands, except per share and market data)Mar 31,
 2016
 Dec 31,
 2015
 Mar 31,
 2015
Operating results     
Net income$28,682  29,508  27,670 
Basic earnings per share$0.38  0.39  0.37 
Diluted earnings per share$0.38  0.39  0.37 
Dividends declared per share 1$0.20  0.49  0.18 
Market value per share     
Closing$25.42  26.53  25.15 
High$26.34  29.69  27.47 
Low$22.19  25.74  22.27 
Selected ratios and other data     
Number of common stock shares outstanding76,168,388 76,086,288 75,530,030
Average outstanding shares - basic76,126,251 75,893,521 75,206,348
Average outstanding shares - diluted76,173,417 75,968,169 75,244,959
Return on average assets (annualized)1.28% 1.32% 1.36%
Return on average equity (annualized)10.53% 10.66% 10.72%
Efficiency ratio56.53% 56.52% 54.80%
Dividend payout ratio52.63% 125.64% 48.65%
Loan to deposit ratio74.65% 73.94% 73.42%
Number of full time equivalent employees2,184 2,149 1,995
Number of locations144 144 137
Number of ATMs167 158 158
_______     
1 Includes a special dividend declared of $0.30 per share for the three months ended December 31, 2015.

KALISPELL, Mont., April 21, 2016 (GLOBE NEWSWIRE) -- Glacier Bancorp, Inc. (Nasdaq: GBCI) reported net income of $28.7 million for the current quarter, an increase of $1.0 million, or 4 percent, from the $27.7 million of net income for the prior year first quarter.  Diluted earnings per share for the current quarter was $0.38 per share, an increase of $0.01, or 3 percent, from the prior year first quarter diluted earnings per share of $0.37.  Included in the current quarter was $135 thousand from acquisition-related expenses and $831 thousand of expenses related to the Company's consolidation of its bank divisions' core database systems (Core Consolidation Project or "CCP") including expenses related to the re-issuance of debit cards with chip technology.  The Company's Core Consolidation Project will occur throughout the current year and is expected to be completed by year end.   "The first quarter was a nice start to the year for us," said Mick Blodnick, President and Chief Executive Officer.  "To produce this level of results at a time when we also had significant costs and time allocated to a number of major internal projects is a testament to the great work by our staff this quarter.  Although these projects will run through the rest of the year, in the future they will streamline multiple functions and allow us to operate more efficiently," Blodnick said.

Asset Summary

       $ Change from
(Dollars in thousands)Mar 31,
 2016
 Dec 31,
 2015
 Mar 31,
 2015
 Dec 31,
 2015
 Mar 31,
 2015
Cash and cash equivalents$150,861  193,253  183,466  (42,392) (32,605)
Investment securities, available-for-sale2,604,625  2,610,760  2,544,093  (6,135) 60,532 
Investment securities, held-to-maturity691,663  702,072  570,285  (10,409) 121,378 
Total investment securities3,296,288  3,312,832  3,114,378  (16,544) 181,910 
Loans receivable         
Residential real estate685,026  688,912  637,465  (3,886) 47,561 
Commercial real estate2,680,691  2,633,953  2,418,843  46,738  261,848 
Other commercial1,172,956  1,099,564  1,007,173  73,392  165,783 
Home equity423,895  420,901  402,970  2,994  20,925 
Other consumer234,625  235,351  221,218  (726) 13,407 
Loans receivable5,197,193  5,078,681  4,687,669  118,512  509,524 
Allowance for loan and lease losses(130,071) (129,697) (129,856) (374) (215)
Loans receivable, net5,067,122  4,948,984  4,557,813  118,138  509,309 
Other assets606,471  634,163  619,439  (27,692) (12,968)
Total assets$9,120,742  9,089,232  8,475,096  31,510  645,646 

Total investment securities of $3.296 billion at March 31, 2016 decreased $16.5 million, or 50 basis points, during the current quarter and increased $182 million, or 6 percent, from March 31, 2015.  The Company continues to selectively purchase investment securities when the Company has excess liquidity.  Investment securities represented 36 percent of total assets at March 31, 2016 compared to 36 percent of total assets at December 31, 2015 and 37 percent at March 31, 2015.

The loan portfolio increased $119 million, or 9 percent annualized, during the current quarter.  The loan category with the largest dollar and percentage increase during the current quarter was other commercial loans which increased $73.4 million, or 7 percent, of which $35.6 million of the increase was from municipal and SBA loans.  Excluding the acquisition of Cañon National Bank ("Cañon") in October 2015, the loan portfolio increased $350 million, or 7 percent, since March 31, 2015 with $152 million and $150 million of the increase coming from growth in commercial real estate and other commercial loans, respectively.  "Our loan growth in the quarter was exceptional especially considering it came in the first quarter of the year," Blodnick said.  "A substantial portion of the growth came from municipal loans, something all of our Banks have worked extremely hard at generating.  Hopefully, we can continue to grow the loan portfolio with more of these solid credits."

Credit Quality Summary

 At or for the
Three Months
ended

 At or for the
Year ended
 At or for the
Three Months
ended

(Dollars in thousands)Mar 31,
 2016
 Dec 31,
 2015
 Mar 31,
 2015
Allowance for loan and lease losses     
Balance at beginning of period$129,697  129,753  129,753 
Provision for loan losses568  2,284  765 
Charge-offs(1,163) (7,001) (1,297)
Recoveries969  4,661  635 
Balance at end of period$130,071  129,697  129,856 
Other real estate owned$22,085  26,815  28,124 
Accruing loans 90 days or more past due4,615  2,131  2,357 
Non-accrual loans53,523  51,133  60,287 
Total non-performing assets 1$80,223  80,079  90,768 
Non-performing assets as a percentage of subsidiary assets0.88% 0.88% 1.07%
Allowance for loan and lease losses as a percentage of non-performing loans224% 244% 207%
Allowance for loan and lease losses as a percentage of total loans2.50% 2.55% 2.77%
Net charge-offs as a percentage of total loans% 0.05% 0.01%
Accruing loans 30-89 days past due$23,996  19,413  33,450 
Accruing troubled debt restructurings$53,311  63,590  69,397 
Non-accrual troubled debt restructurings$23,879  27,057  34,237 
__________
1 As of March 31, 2016, non-performing assets have not been reduced by U.S. government guarantees of $2.2 million.



Non-performing assets at March 31, 2016 were $80.2 million, an increase of $144 thousand, or 18 basis points, during the current quarter.  Non-performing assets at March 31, 2016 decreased $10.5 million, or 12 percent, from a year ago.  Early stage delinquencies (accruing loans 30-89 days past due) of $24.0 million at March 31, 2016 increased $4.6 million from the prior quarter and decreased $9.5 million from the prior year first quarter.

The allowance for loan and lease losses ("allowance") was $130 million at March 31, 2016, consistent with prior periods.  The allowance as a percent of total loans outstanding at March 31, 2016 was 2.50 percent, a slight decrease from 2.55 percent at December 31, 2015.  The allowance as a percent of total loans in the current quarter decreased 27 basis points from 2.77 percent at March 31, 2015 which was driven primarily by loan growth, stabilizing credit quality, and no allowance carried over from the Cañon acquisition as a result of the acquired loans recorded at fair value.

Credit Quality Trends and Provision for Loan Losses

(Dollars in thousands)Provision
for Loan
Losses

 Net
Charge-Offs
 (Recoveries)

 ALLL
as a Percent
of Loans

 Accruing
Loans 30-89
Days Past Due
as a Percent of
Loans



 Non-Performing
Assets to
Total Subsidiary
Assets


First quarter 2016$568  $194  2.50% 0.46% 0.88%
Fourth quarter 2015411  1,482  2.55% 0.38% 0.88%
Third quarter 2015826  577  2.68% 0.37% 0.97%
Second quarter 2015282  (381) 2.71% 0.59% 0.98%
First quarter 2015765  662  2.77% 0.71% 1.07%
Fourth quarter 2014191  1,070  2.89% 0.58% 1.08%
Third quarter 2014360  364  2.93% 0.39% 1.21%
Second quarter 2014239  332  3.11% 0.44% 1.30%

Net charge-offs of loans for the current quarter were $194 thousand compared to net charge-offs of $1.5 million for the prior quarter and net charge-offs of $662 thousand from the same quarter last year.  The current quarter provision for loan losses of $568 thousand increased $157 thousand from the prior quarter and decreased $197 thousand from the prior year first quarter.  Loan portfolio growth, composition, average loan size, credit quality considerations, and other environmental factors will continue to determine the level of the loan loss provision.

Supplemental information regarding credit quality and identification of the Company's loan portfolio based on regulatory classification is provided in the exhibits at the end of this press release.  The regulatory classification of loans is based primarily on collateral type while the Company's loan segments presented herein are based on the purpose of the loan.

Liability Summary

       $ Change from
(Dollars in thousands)Mar 31,
 2016
 Dec 31,
 2015
 Mar 31,
 2015
 Dec 31,
 2015
 Mar 31,
 2015
Deposits         
Non-interest bearing deposits$1,887,004  1,918,310  1,675,451  (31,306) 211,553 
NOW and DDA accounts1,448,454  1,516,026  1,313,036  (67,572) 135,418 
Savings accounts879,541  838,274  748,590  41,267  130,951 
Money market deposit accounts1,411,970  1,382,028  1,345,422  29,942  66,548 
Certificate accounts1,063,735  1,060,650  1,164,909  3,085  (101,174)
Core deposits, total6,690,704  6,715,288  6,247,408  (24,584) 443,296 
Wholesale deposits325,490  229,720  211,384  95,770  114,106 
Deposits, total7,016,194  6,945,008  6,458,792  71,186  557,402 
Repurchase agreements445,960  423,414  425,652  22,546  20,308 
Federal Home Loan Bank advances313,969  394,131  298,148  (80,162) 15,821 
Other borrowed funds6,633  6,602  6,703  31  (70)
Subordinated debentures125,884  125,848  125,741  36  143 
Other liabilities118,422  117,579  106,536  843  11,886 
Total liabilities$8,027,062  8,012,582  7,421,572  14,480  605,490 

Non-interest bearing deposits of $1.887 billion at March 31, 2016, decreased $31 million, or 2 percent, from the prior quarter which was driven by seasonal fluctuations.  Excluding the Cañon acquisition, non-interest bearing deposits increased $122 million, or 7 percent, from March 31, 2015.  Core interest bearing deposits of $4.804 billion at March 31, 2016, increased $6.7 million, or 14 basis points, from the prior quarter.  The increase in savings and money market accounts during the current quarter offset the decrease in NOW and DDA accounts.  Excluding the Cañon acquisition, core interest bearing deposits at March 31, 2016 increased $83.5 million, or 2 percent, from March 31, 2015.  Wholesale deposits (i.e., brokered deposits classified as NOW, DDA, money market deposit and certificate accounts) of $325 million at March 31, 2016 increased $95.8 million over the prior quarter and increased $114 million over the prior year first quarter.  A portion of the increases were driven by a need to obtain wholesale deposits necessary for the interest rate swap.

Securities sold under agreements to repurchase ("repurchase agreements") of $446 million at March 31, 2016 increased $22.5 million, or 5 percent, from the prior quarter and increased $20.3 million, or 5 percent, from the prior year first quarter.  Federal Home Loan Bank ("FHLB") advances of $314 million at March 31, 2016 decreased $80.2 million, or 20 percent, during the current quarter due to stable deposit balances and reduced need for additional borrowings.

Stockholders' Equity Summary

       $ Change from
(Dollars in thousands, except per share data)Mar 31, Dec 31, Mar 31, Dec 31, Mar 31,
20162015201520152015
Common equity$1,088,359  1,074,661  1,035,497  13,698  52,862 
Accumulated other comprehensive income5,321  1,989  18,027  3,332  (12,706
Total stockholders' equity1,093,680  1,076,650  1,053,524  17,030  40,156 
Goodwill and core deposit intangible, net(154,396) (155,193) (143,099) 797  (11,297
Tangible stockholders' equity$939,284  921,457  910,425  17,827  28,859 
             
Stockholders' equity to total assets11.99% 11.85% 12.43%    
Tangible stockholders' equity to total tangible assets10.48% 10.31% 10.93%    
Book value per common share$14.36  14.15  13.95  0.21  0.41 
Tangible book value per common share$12.33  12.11  12.05  0.22  0.28 

Tangible stockholders' equity of $939 million at March 31, 2016 increased $17.8 million, or 2 percent, from the prior quarter primarily from earnings retention and an increase in accumulated other comprehensive income.  Tangible stockholders' equity increased $28.9 million, or 3 percent, from a year ago, the result of earnings retention and $15.2 million of Company stock issued in connection with the Cañon acquisition.  These two items offset the decrease in accumulated other comprehensive income and increases in goodwill and other intangibles from the acquisition.  At March 31, 2016, the tangible book value per common share was $12.33 an increase of $0.22 per share from $12.11 the prior quarter principally due to earnings retention.  Tangible book value per common share for March 31, 2016, increased $0.28 per share from the prior year first quarter.

Cash Dividend
On March 30, 2016, the Company's Board of Directors declared a quarterly cash dividend of $0.20 per share, a $0.01 per share, or 5 percent, increase over the prior quarter dividend.  The Company has increased its quarterly dividend 40 times.  The dividend was payable April 21, 2016 to shareholders of record April 12, 2016.  Future cash dividends will depend on a variety of factors, including net income, capital, asset quality, general economic conditions and regulatory considerations.

Operating Results for Three Months Ended March 31, 2016
Compared to December 31, 2015 and March 31, 2015

Income Summary

 Three Months ended $ Change from
(Dollars in thousands)Mar 31,
 2016
 Dec 31,
 2015
 Mar 31,
 2015
 Dec 31,
 2015
 Mar 31,
 2015
Net interest income         
Interest income$84,381  83,211  77,486  1,170  6,895 
Interest expense7,675  7,215  7,382  460  293 
Total net interest income76,706  75,996  70,104  710  6,602 
Non-interest income         
Service charges and other fees14,331  15,044  12,999  (713) 1,332 
Miscellaneous loan fees and charges1,021  922  1,157  99  (136)
Gain on sale of loans5,992  6,033  5,430  (41) 562 
Gain on sale of investments108  143  5  (35) 103 
Other income2,800  2,325  3,102  475  (302)
Total non-interest income24,252  24,467  22,693  (215) 1,559 
 $100,958  100,463  92,797  495  8,161 
Net interest margin (tax-equivalent)4.01% 4.02% 4.03%    

Net Interest Income
In the current quarter, interest income of $84.4 million increased $1.2 million, or 1 percent from the prior quarter and increased $6.9 million, or 9 percent, over the prior year first quarter.  The increases in interest income over the prior periods were driven primarily by increases in interest income on commercial loans which increased $1.4 million, or 3 percent, over the prior quarter and increased $5.5 million, or 14 percent, over the prior year first quarter and was the result of an increased volume of commercial loans.  Interest income of $23.9 million from investment securities increased $152 thousand, or 1 percent, over the prior quarter and increased $924 thousand, or 4 percent, over the prior year first quarter.

The current quarter interest expense of $7.7 million increased $460 thousand, or 6 percent, from the prior quarter and increased $293 thousand from the prior year first quarter.  The increases in interest expense were driven by the increase in wholesale deposits and the additional interest expense for an interest rate swap with a notional $100 million that began its accrual period in December 2015.  The total cost of funding (including non-interest bearing deposits) for the current quarter was 39 basis points compared to 37 basis points for the prior quarter and 42 basis points in the prior year first quarter.

The Company's net interest margin as a percentage of earning assets, on a tax-equivalent basis, for the current quarter was 4.01 percent compared to 4.02 percent in the prior quarter.  During the current quarter, the earning asset yield increased by 1 basis point and was the result of a 1 basis point increase in loan yields.  The cost of funds increased 2 basis points during the current quarter due to increased wholesale deposits and the higher interest expense from the previously mentioned interest rate swap.  The Company's current quarter net interest margin decreased 2 basis points from the prior year first quarter net interest margin of 4.03 percent.  The decrease in the net interest margin from the prior year first quarter was the result of a 4 basis points reduction in the yield on earning assets that outpaced the 3 basis points reduction in cost of funding.  The yield on earning assets benefited from the shift in earning assets from the lower yielding investment securities to the higher yielding loans; nevertheless it was outpaced by the overall decreased yield on the loan portfolio.  "The Company was pleased to maintain a net interest margin above 4 percent for the quarter given the volatile interest rate environment.  The increase in overall loan yields and maintaining the low cost of retail deposits supported the quarterly performance of the net interest margin," said Ron Copher, Chief Financial Officer.

Non-interest Income
Non-interest income for the current quarter totaled $24.3 million, a decrease of $215 thousand, or 1 percent, from the prior quarter and an increase of $1.6 million, or 7 percent, over the same quarter last year.  Service fee income of $14.3 million, increased $1.3 million, or 10 percent, from the prior year first quarter driven by the increased number of deposit accounts.  Gain on sale of residential loans for the current quarter increased $562 thousand, or 10 percent, from the prior year first quarter.  In the prior year first quarter, the Company experienced a strong quarter for sales of residential loans as a result of the refinance activity and the Company's resource commitment to this line of business has benefited the Company with an even stronger current year first quarter.  Other non-interest income of $2.8 million for the current quarter increased $475 thousand, or 20 percent, over the prior quarter primarily due to annual vendor incentives received and a gain on the sale of a bank building.  Other non-interest income for the current quarter decreased $302 thousand from the prior year first quarter due to insurance proceeds received in the prior year first quarter from a bank owned life insurance policy.  Included in other income was operating revenue of $11 thousand from OREO and a gain of $203 thousand from the sale of OREO, a combined total of $214 thousand for the current quarter compared to $239 thousand for the prior quarter and $417 thousand for the prior year first quarter.

Non-interest Expense Summary

 Three Months ended $ Change from
(Dollars in thousands)Mar 31,
 2016
 Dec 31,
 2015
 Mar 31,
 2015
 Dec 31,
 2015
 Mar 31,
 2015
Compensation and employee benefits$36,941  35,902  32,244  1,039  4,697 
Occupancy and equipment6,676  6,579  6,060  97  616 
Advertising and promotions2,125  2,035  1,927  90  198 
Data processing3,373  3,244  2,551  129  822 
Other real estate owned390  511  758  (121) (368)
Regulatory assessments and insurance1,508  1,494  1,305  14  203 
Core deposit intangibles amortization797  758  731  39  66 
Other expenses10,546  11,680  9,921  (1,134) 625 
Total non-interest expense$62,356  62,203  55,497  153  6,859 

Compensation and employee benefits for the current quarter increased by $1.0 million, or 3 percent, from the prior quarter as a result of an increased number of employees from the Cañon acquisition and annual salary increases.  Compensation and employee benefits for the current quarter increased by $4.7 million, or 15 percent, from the prior year first quarter due to the increased number of employees from the Community Bank, Inc. ("CB") acquisition in February of 2015 and the Cañon acquisition, annual salary increases, and an increase in the number of employees.  Current quarter occupancy and equipment expense increased $616 thousand, or 10 percent, from the prior year first quarter as a result of added costs associated with the acquisitions.  The current quarter data processing expense increased $822 thousand, or 32 percent, from the prior year first quarter primarily from expenses associated with CCP and expenses from the Cañon acquisition.  The current quarter OREO expense of $390 thousand was a decrease of $368 thousand from the prior year first quarter and included $136 thousand of operating expense, $55 thousand of fair value write-downs, and $199 thousand of loss from the sales of OREO.  Current quarter other expenses of $10.6 million decreased by $1.1 million, or 10 percent, from the prior quarter.  The prior quarter included professional expenses associated with the Cañon acquisition and expenses connected with equity investments in New Markets Tax Credit ("NMTC") projects.  Federal and state income tax expense of $9.4 million in the current quarter increased $1.0 million from the prior quarter and was primarily the result of the NMTC credits recognized in the prior quarter.  Current quarter other expenses increased $625 thousand, or 6 percent, over the prior year first quarter with increases related to CCP and increased expenses from recent acquisitions, albeit several areas experienced decreases including outside services, which decreased as a result of acquisition-related expenses in the prior year first quarter.

Efficiency Ratio
Although there were increased expenses in the current quarter related to CCP, the efficiency ratio for the current quarter of 56.53 percent remained stable compared to 56.52 percent in the prior quarter with minimal changes in the income and expense items related to the efficiency ratio.  The current quarter efficiency ratio of 56.53 percent compares to 54.80 percent in the prior year first quarter.  The 1.73 percent increase in the efficiency ratio resulted primarily from increased compensation expense from recent acquisitions and increased salaries along with increased expenses related to CCP, which outpaced the increases in net interest income and non-interest income for the same period.

Forward-Looking Statements
This news release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  These forward-looking statements include, but are not limited to, statements about management's plans, objectives, expectations and intentions that are not historical facts, and other statements identified by words such as "expects," "anticipates," "intends," "plans," "believes," "should," "projects," "seeks," "estimates" or words of similar meaning.  These forward-looking statements are based on current beliefs and expectations of management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the Company's control.  In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change.  The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations in the forward-looking statements, including those set forth in this news release:

  • the risks associated with lending and potential adverse changes of the credit quality of loans in the Company's portfolio;
  • changes in trade, monetary and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System or the Federal Reserve Board, which could adversely affect the Company's net interest income and profitability;
  • legislative or regulatory changes, including increased banking and consumer protection regulation that adversely affect the Company's business;
  • ability to complete pending or prospective future acquisitions, limit certain sources of revenue, or increase cost of operations;
  • costs or difficulties related to the completion and integration of acquisitions;
  • the goodwill the Company has recorded in connection with acquisitions could become impaired, which may have an adverse impact on earnings and capital;
  • reduced demand for banking products and services;
  • the risks presented by continued public stock market volatility, which could adversely affect the market price of the Company's common stock and the ability to raise additional capital or grow the Company through acquisitions;
  • consolidation in the financial services industry in the Company's markets resulting in the creation of larger financial institutions who may have greater resources could change the competitive landscape;
  • dependence on the CEO, the senior management team and the Presidents of Bank divisions;
  • potential interruption or breach in security of the Company's systems and technological changes which could expose us to new risks, fraud or system failures; and
  • the Company's success in managing risks involved in the foregoing.

The Company does not undertake any obligation to publicly correct or update any forward-looking statement if it later becomes aware that actual results are likely to differ materially from those expressed in such forward-looking statement.

Conference Call Information
A conference call for investors is scheduled for 11:00 a.m. Eastern Time on Friday, April 22, 2016.  The conference call will be accessible by telephone and through the Internet.  Interested individuals are invited to listen to the call by telephone at 877-561-2748 and the conference ID is 77408162.  To participate on the webcast, log on to: http://edge.media-server.com/m/p/8dya659f.  If you are unable to participate during the live webcast, the call will be archived on our Web site, www.glacierbancorp.com, or by calling 855-859-2056 with the ID 77408162 until May 5, 2016.

About Glacier Bancorp, Inc.
Glacier Bancorp, Inc. is a regional bank holding company providing commercial banking services in 88 communities in Montana, Idaho, Utah, Washington, Wyoming and Colorado. Glacier Bancorp, Inc. is headquartered in Kalispell, Montana, and  is the parent company for Glacier Bank, Kalispell and Bank divisions First Security Bank of Missoula; Valley Bank of Helena; Big Sky Western Bank, Bozeman; Western Security Bank, Billings; and First Bank of Montana, Lewistown, all operating in Montana; as well as Mountain West Bank, Coeur d'Alene operating in Idaho, Utah and Washington; Citizens Community Bank, Pocatello, operating in Idaho; 1st Bank, Evanston, operating in Wyoming and Utah;  First Bank of Wyoming, Powell and First State Bank, Wheatland,   each operating in Wyoming; North Cascades Bank, Chelan, operating in Washington; and Bank of the San Juans, Durango, operating in Colorado. 



Glacier Bancorp, Inc.
Unaudited Condensed Consolidated Statements of Financial Condition
 
(Dollars in thousands, except per share data)March 31,
 2016
 December 31,
 2015
 March 31,
 2015
Assets     
Cash on hand and in banks$104,222  117,137  109,746 
Federal funds sold1,400  6,080   
Interest bearing cash deposits45,239  70,036  73,720 
Cash and cash equivalents150,861  193,253  183,466 
Investment securities, available-for-sale2,604,625  2,610,760  2,544,093 
Investment securities, held-to-maturity691,663  702,072  570,285 
Total investment securities3,296,288  3,312,832  3,114,378 
Loans held for sale40,484  56,514  54,132 
Loans receivable5,197,193  5,078,681  4,687,669 
Allowance for loan and lease losses(130,071) (129,697) (129,856)
Loans receivable, net5,067,122  4,948,984  4,557,813 
Premises and equipment, net192,951  194,030  187,067 
Other real estate owned22,085  26,815  28,124 
Accrued interest receivable47,363  44,524  43,260 
Deferred tax asset55,773  58,475  41,220 
Core deposit intangible, net13,758  14,555  12,256 
Goodwill140,638  140,638  130,843 
Non-marketable equity securities24,199  27,495  54,277 
Other assets69,220  71,117  68,260 
Total assets$9,120,742  9,089,232  8,475,096 
Liabilities     
Non-interest bearing deposits$1,887,004  1,918,310  1,675,451 
Interest bearing deposits5,129,190  5,026,698  4,783,341 
Federal funds purchased     
Securities sold under agreements to repurchase445,960  423,414  425,652 
FHLB advances313,969  394,131  298,148 
Other borrowed funds6,633  6,602  6,703 
Subordinated debentures125,884  125,848  125,741 
Accrued interest payable3,608  3,517  3,893 
Other liabilities114,814  114,062  102,643 
Total liabilities8,027,062  8,012,582  7,421,572 
Stockholders' Equity     
Preferred shares, $0.01 par value per share, 1,000,000  shares authorized, none issued or outstanding     
Common stock, $0.01 par value per share, 117,187,500  shares authorized762  761  755 
Paid-in capital736,664  736,368  719,506 
Retained earnings - substantially restricted350,933  337,532  315,236 
Accumulated other comprehensive income5,321  1,989  18,027 
Total stockholders' equity1,093,680  1,076,650  1,053,524 
Total liabilities and stockholders' equity$9,120,742  9,089,232  8,475,096 





Glacier Bancorp, Inc.
Unaudited Condensed Consolidated Statements of Operations
 
 Three Months ended
(Dollars in thousands, except per share data)March 31,
 2016
 December 31,
 2015
 March 31,
 2015
Interest Income     
Investment securities$23,883  23,731  22,959 
Residential real estate loans8,285  8,572  7,761 
Commercial loans44,503  43,109  39,022 
Consumer and other loans7,710  7,799  7,744 
Total interest income84,381  83,211  77,486 
Interest Expense     
Deposits4,795  3,932  4,147 
Securities sold under agreements to repurchase318  287  241 
Federal Home Loan Bank advances1,652  2,156  2,195 
Federal funds purchased and other borrowed funds18  18  27 
Subordinated debentures892  822  772 
Total interest expense7,675  7,215  7,382 
Net Interest Income76,706  75,996  70,104 
Provision for loan losses568  411  765 
Net interest income after provision for loan losses76,138  75,585  69,339 
Non-Interest Income     
Service charges and other fees14,331  15,044  12,999 
Miscellaneous loan fees and charges1,021  922  1,157 
Gain on sale of loans5,992  6,033  5,430 
Gain on sale of investments108  143  5 
Other income2,800  2,325  3,102 
Total non-interest income24,252  24,467  22,693 
Non-Interest Expense     
Compensation and employee benefits36,941  35,902  32,244 
Occupancy and equipment6,676  6,579  6,060 
Advertising and promotions2,125  2,035  1,927 
Data processing3,373  3,244  2,551 
Other real estate owned390  511  758 
Regulatory assessments and insurance1,508  1,494  1,305 
Core deposit intangibles amortization797  758  731 
Other expenses10,546  11,680  9,921 
Total non-interest expense62,356  62,203  55,497 
Income Before Income Taxes38,034  37,849  36,535 
Federal and state income tax expense9,352  8,341  8,865 
Net Income$28,682  29,508  27,670 



Glacier Bancorp, Inc.
Average Balance Sheet
 
 Three Months ended
 March 31, 2016 March 31, 2015
(Dollars in thousands)Average
Balance
 Interest &
Dividends
 Average
Yield/
Rate

 Average
Balance
 Interest &
Dividends
 Average
Yield/
Rate

Assets           
Residential real estate loans$726,270  $8,285  4.56% $651,700  $7,761  4.76%
Commercial loans 13,749,929  45,335  4.86% 3,282,867  39,605  4.89%
Consumer and other loans653,839  7,710  4.74% 609,853  7,744  5.15%
Total loans 25,130,038  61,330  4.81% 4,544,420  55,110  4.92%
Tax-exempt investment securities 31,352,683  19,383  5.73% 1,302,174  18,493  5.68%
Taxable investment securities 41,999,000  11,461  2.29% 1,904,835  10,754  2.26%
Total earning assets8,481,721  92,174  4.37% 7,751,429  84,357  4.41%
Goodwill and intangibles154,790      140,726     
Non-earning assets390,891      379,581     
Total assets$9,027,402      $8,271,736     
Liabilities           
Non-interest bearing deposits$1,863,389  $  % $1,618,132  $  %
NOW and DDA accounts1,465,181  293  0.08% 1,311,330  268  0.08%
Savings accounts863,764  104  0.05% 713,897  89  0.05%
Money market deposit accounts1,406,718  553  0.16% 1,304,006  517  0.16%
Certificate accounts1,071,055  1,564  0.59% 1,165,483  1,843  0.64%
Wholesale deposits 5335,126  2,281  2.74% 220,382  1,430  2.63%
FHLB advances308,040  1,652  2.12% 299,975  2,195  2.93%
Repurchase agreements and  other borrowed funds521,565  1,228  0.95% 503,816  1,040  0.84%
Total funding liabilities7,834,838  7,675  0.39% 7,137,021  7,382  0.42%
Other liabilities96,701      88,143     
Total liabilities7,931,539      7,225,164     
Stockholders' Equity           
Common stock761      752     
Paid-in capital736,398      712,127     
Retained earnings351,536      314,004     
Accumulated other comprehensive income7,168      19,689     
Total stockholders' equity1,095,863      1,046,572     
Total liabilities and stockholders' equity$9,027,402      $8,271,736     
Net interest income (tax-equivalent)  $84,499      $76,975   
Net interest spread (tax-equivalent)    3.98%     3.99%
Net interest margin (tax-equivalent)    4.01%     4.03%
__________
Includes tax effect of $832 thousand and $583 thousand on tax-exempt municipal loan and lease income for the three months ended March 31, 2016 and 2015, respectively.
2  Total loans are gross of the allowance for loan and lease losses, net of unearned income and include loans held for sale.  Non-accrual loans were included in the average volume for the entire period.
Includes tax effect of $6.6 million and $5.9 million on tax-exempt investment securities income for the three months ended March 31, 2016 and 2015, respectively.
Includes tax effect of $352 thousand and $362 thousand on federal income tax credits for the three months ended March 31, 2016 and 2015, respectively.
Wholesale deposits include brokered deposits classified as NOW, DDA, money market deposit and certificate accounts.



Glacier Bancorp, Inc.
Loan Portfolio by Regulatory Classification
 
 Loans Receivable, by Loan Type % Change from
(Dollars in thousands)Mar 31,
 2016
 Dec 31,
 2015
 Mar 31,
 2015
 Dec 31,
 2015
 Mar 31,
 2015
Custom and owner occupied construction$68,893  $75,094  $51,693  (8)% 33%
Pre-sold and spec construction59,220  50,288  44,865  18% 32%
Total residential construction128,113  125,382  96,558  2% 33%
Land development59,539  62,356  81,488  (5)% (27)%
Consumer land or lots93,922  97,270  97,519  (3)% (4)%
Unimproved land73,791  73,844  80,206  % (8)%
Developed lots for operative builders12,973  12,336  14,210  5% (9)%
Commercial lots23,558  22,035  21,059  7% 12%
Other construction166,378  156,784  148,535  6% 12%
Total land, lot, and other construction430,161  424,625  443,017  1% (3)%
Owner occupied944,411  938,625  877,293  1% 8%
Non-owner occupied806,856  774,192  704,990  4% 14%
Total commercial real estate1,751,267  1,712,817  1,582,283  2% 11%
Commercial and industrial664,855  649,553  585,501  2% 14%
Agriculture372,616  367,339  340,364  1% 9%
1st lien841,848  856,193  796,947  (2)% 6%
Junior lien63,162  65,383  67,217  (3)% (6)%
Total 1-4 family905,010  921,576  864,164  (2)% 5%
Multifamily residential197,267  201,542  177,187  (2)% 11%
Home equity lines of credit379,866  372,039  347,693  2% 9%
Other consumer150,047  150,469  141,347  % 6%
Total consumer529,913  522,508  489,040  1% 8%
Other258,475  209,853  163,687  23% 58%
Total loans receivable, including  loans held for sale5,237,677  5,135,195  4,741,801  2% 10%
Less loans held for sale 1(40,484) (56,514) (54,132) (28)% (25)%
Total loans receivable$5,197,193  $5,078,681  $4,687,669  2% 11%
_______
1 Loans held for sale are primarily 1st lien 1-4 family loans.



Glacier Bancorp, Inc.
Credit Quality Summary by Regulatory Classification
 
  

Non-performing Assets, by Loan Type

 Non-
Accrual
Loans

 Accruing
Loans 90 Days
or More Past
  Due


 Other
Real Estate
Owned

(Dollars in thousands)Mar 31,
 2016
 Dec 31,
 2015
 Mar 31,
 2015
 Mar 31,
 2016
 Mar 31,
 2016
 Mar 31,
 2016
Custom and owner occupied construction$995  1,016  1,101  995     
Pre-sold and spec construction    218       
Total residential construction995  1,016  1,319  995     
Land development18,190  17,582  21,220  5,948  249  11,993 
Consumer land or lots1,751  2,250  2,531  923    828 
Unimproved land11,651  12,328  13,448  8,252    3,399 
Developed lots for operative builders457  488  929  264    193 
Commercial lots1,333  1,521  2,496  217    1,116 
Other construction  4,236  4,989       
Total land, lot and other construction33,382  38,405  45,613  15,604  249  17,529 
Owner occupied12,130  10,952  13,121  10,471    1,659 
Non-owner occupied4,354  3,446  3,771  2,231  1,311  812 
Total commercial real estate16,484  14,398  16,892  12,702  1,311  2,471 
Commercial and industrial6,046  3,993  6,367  5,984  62   
Agriculture3,220  3,281  2,845  3,005  215   
1st lien11,041  10,691  9,502  8,713  832  1,496 
Junior lien1,111  668  680  745    366 
Total 1-4 family12,152  11,359  10,182  9,458  832  1,862 
Multifamily residential432  113    432     
Home equity lines of credit5,432  5,486  5,507  5,192  107  133 
Other consumer280  228  243  151  39  90 
Total consumer5,712  5,714  5,750  5,343  146  223 
Other1,800  1,800  1,800    1,800   
Total$80,223  80,079  90,768  53,523  4,615  22,085 



Glacier Bancorp, Inc.
Credit Quality Summary by Regulatory Classification (continued)
 
 Accruing 30-
89 Days Delinquent Loans, by Loan Type
 % Change from
(Dollars in thousands)Mar 31,
 2016
 Dec 31,
 2015
 Mar 31,
 2015
 Dec 31,
 2015
 Mar 31,
 2015
Custom and owner occupied construction$  $462  $  (100)% n/m
Pre-sold and spec construction304  181    68% n/m
Total residential construction304  643    (53)% n/m
Land development198  447    (56)% n/m
Consumer land or lots796  166  365  380% 118%
Unimproved land1,284  774  278  66% 362%
Developed lots for operative builders    19  n/m (100)%
Commercial lots    585  n/m (100)%
Other construction  337    (100)% n/m
Total land, lot and other construction2,278  1,724  1,247  32% 83%
Owner occupied4,552  2,760  4,841  65% (6)%
Non-owner occupied1,466  923  4,327  59% (66)%
Total commercial real estate6,018  3,683  9,168  63% (34)%
Commercial and industrial4,907  1,968  6,600  149% (26)%
Agriculture659  1,014  3,715  (35)% (82)%
1st lien5,896  6,272  7,307  (6)% (19)%
Junior lien759  1,077  384  (30)% 98%
Total 1-4 family6,655  7,349  7,691  (9)% (13)%
Multifamily Residential  662  676  (100)% (100)%
Home equity lines of credit2,528  1,046  3,350  142% (25)%
Other consumer607  1,227  1,003  (51)% (39)%
Total consumer3,135  2,273  4,353  38% (28)%
Other40  97    (59)% n/m
Total$23,996  $19,413  $33,450  24% (28)%
_______
n/m - not measurable



Glacier Bancorp, Inc.
Credit Quality Summary by Regulatory Classification (continued)
 
 Net Charge-Offs (Recoveries), Year-to-Date
Period Ending, By Loan Type
 Charge-Offs Recoveries
(Dollars in thousands)Mar 31,
 2016
 Dec 31,
 2015
 Mar 31,
 2015
 Mar 31,
 2016
 Mar 31,
 2016
Pre-sold and spec construction$(28) (53) (9)   28 
Land development(100) (288) (23)   100 
Consumer land or lots(240) 66  (15) 25  265 
Unimproved land(34) (325) (50)   34 
Developed lots for operative builders(12) (85) (96)   12 
Commercial lots23  (26) (1) 24  1 
Other construction  (1) (1)    
Total land, lot and other construction(363) (659) (186) 49  412 
Owner occupied(27) 247  316    27 
Non-owner occupied(1) 93  82    1 
Total commercial real estate(28) 340  398    28 
Commercial and industrial69  1,389  426  324  255 
Agriculture(1) 50  (4)   1 
1st lien47  834  (30) 75  28 
Junior lien(15) (125) (54)   15 
Total 1-4 family32  709  (84) 75  43 
Multifamily residential229  (318) (20) 229   
Home equity lines of credit179  740  121  229  50 
Other consumer95  143  20  155  60 
Total consumer274  883  141  384  110 
Other10  (1)   102  92 
Total$194  2,340  662  1,163  969 



Visit our website at www.glacierbancorp.com

CONTACT:  Michael J. Blodnick (406) 751-4701 Ron J. Copher (406) 751-7706

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