Umpqua Reports First Quarter 2019 Results

PORTLAND, Ore., April 17, 2019 /PRNewswire/ -- Umpqua Holdings Corporation UMPQ (the "Company") reported net income of $74.0 million for the first quarter of 2019, compared to $80.3 million for the fourth quarter of 2018 and $79.0 million for the first quarter of 2018.  Earnings per diluted common share were $0.34 for the first quarter of 2019, compared to $0.36 for the fourth quarter of 2018 and $0.36 for the first quarter of 2018.

(PRNewsfoto/Umpqua Holdings Corporation)

"Umpqua's financial performance in the first quarter illustrates how our Next Gen strategy is driving enhanced profitability and creating long-term shareholder value," said Cort O'Haver, president and CEO of Umpqua Holdings Corporation. "Although higher than usual payoffs in our commercial real estate portfolio impacted sequential quarter loan growth, it was otherwise an effective quarter of loan production across all lines of business. And the Company's operational excellence initiative led to total non-interest expense of $171.6 million, which represents a $14.5 million, or 8%, decrease when compared to results from the first quarter of 2018. In addition, we continue to be focused on generating consistent earnings, both by generating increased fee income and by exploring how to reduce future income statement volatility of the MSR asset."

Notable items that impacted the first quarter 2019 financial results included:

  • $14.0 million loss on fair value change of the MSR asset, compared to a $13.1 million loss in the prior quarter and a $5.1 million gain in the same period of the prior year.
  • $2.5 million loss related to the fair value of the debt capital market swap derivatives, compared to a loss of $3.0 million in the prior quarter and a gain of $1.1 million in the same period of the prior year.
  • $1.9 million in restructuring charges related to operational excellence initiatives, all in professional fees. This compares to $4.0 million in the prior quarter and $2.7 million in the same period of the prior year.
  • $1.4 million of exit and disposal costs, compared to $0.8 million in the prior quarter and $2.5 million in the same period of the prior year.

First Quarter 2019 Highlights (compared to prior quarter):

  • Net interest income decreased by $9.7 million on a quarter to quarter basis primarily driven by bond premium amortization as compared to the bond premium recapture recorded in the prior quarter.
  • Provision for loan and lease losses decreased by $3.5 million, as net charge-offs decreased by five basis points to 0.27% of average loans and leases (annualized);
  • Non-interest income decreased by $11.1 million, driven primary by the nonrecurring $5.8 million gain on sale of Pivotus assets in the fourth quarter of 2018 and lower residential mortgage banking revenue in the current quarter;
  • Non-interest expense decreased by $6.9 million, driven primarily by operational excellence initiatives, lower restructuring charges (see notable items above), lower mortgage banking-related expense, lower group insurance charges, and lower loss on OREO, partially offset by a seasonal increase in payroll taxes.
  • Non-performing assets to total assets improved to 0.32%;
  • Estimated total risk-based capital ratio of 13.5% and estimated Tier 1 common to risk weighted assets ratio of 10.7%;
  • Declared a quarterly cash dividend of $0.21 per common share.

Balance Sheet

Total consolidated assets were $27.4 billion as of March 31, 2019, compared to $26.9 billion as of December 31, 2018 and $25.8 billion as of March 31, 2018.  Including secured off-balance sheet lines of credit, total available liquidity was $10.9 billion as of March 31, 2019, representing 40% of total assets and 51% of total deposits.

Gross loans and leases were $20.4 billion as of March 31, 2019, a decrease of $16.7 million relative to December 31, 2018.  The timing of commercial and corporate loan closings in the prior quarter as well as an increase in payoffs of our commercial real estate portfolio offset new loan production.

Total deposits were $21.2 billion as of March 31, 2019, an increase of $106.4 million from $21.1 billion as of December 31, 2018.  This increase was attributable to higher time deposits partially offset with the seasonal run-off of public money market deposits.

Net Interest Income

Net interest income was $237.7 million for the first quarter of 2019, down $9.7 million from the prior quarter driven primarily by the amortization of bond purchase premium in the quarter as compared to the recapture in the prior quarter.

The Company's net interest margin was 4.03% for the first quarter of 2019, down 12 basis points from 4.15% for the fourth quarter of 2018.  This decrease was primarily attributable to a quarter over quarter change in bond purchase premium amortization/recapture.

Credit Quality

The allowance for loan and lease losses was $144.9 million, or 0.71% of loans and leases, as of March 31, 2019, which was unchanged from $144.9 million, or 0.71% of loans and leases, as of December 31, 2018.  The provision for loan and lease losses was $13.7 million for the first quarter of 2019, a decrease of $3.5 million from the prior quarter level, driven by the reduction of net charge-offs in the quarter. Net charge-offs decreased by five basis points to 0.27% of average loans and leases (annualized).  As of March 31, 2019, non-performing assets were 0.32% of total assets, compared to 0.36% as of December 31, 2018 and 0.33% as of March 31, 2018.

Non-interest Income

Non-interest income was $45.7 million for the first quarter of 2019, down $11.1 million from the prior quarter,  reflecting the nonrecurring $5.8 million gain on sale of Pivotus assets in the fourth quarter of 2018, and lower net revenue from the origination and sale of residential mortgages.

Net revenue from the origination and sale of residential mortgages was $14.4 million for the first quarter of 2019, down $2.3 million from the prior quarter.  This decrease reflects a 17% sequential quarter decrease in for-sale mortgage origination volume, partially offset by a 12 basis point increase in the home lending gain on sale margin to 2.95% for the first quarter of 2019.  The increase in the home lending gain on sale margin was primarily related to an increase in the mortgage rate lock pipeline.  Of the current quarter's mortgage production, 71% related to purchase activity, compared to 80% for the prior quarter and 68% for the same period of the prior year.

Non-interest Expense

Non-interest expense was $171.6 million for the first quarter of 2019, down $6.9 million from the prior quarter level.  This decrease was driven primarily by the Company's operational excellence initiatives, lower restructuring charges (see notable items above), lower mortgage banking-related expense, lower group insurance charges, and lower loss on OREO, partially offset by a seasonal increase in payroll taxes.

Capital

As of March 31, 2019, the Company's tangible book value per common share1 was $10.44, compared to $10.19 in the prior quarter and $9.77 in the same period of the prior year.  During the first quarter of 2019, the Company declared a dividend of $0.21 per common share.

The Company's estimated total risk-based capital ratio was 13.5% and its estimated Tier 1 common to risk weighted assets ratio was 10.7% as of March 31, 2019.  The Company remains above current "well-capitalized" regulatory minimums.  The regulatory capital ratios as of March 31, 2019 are estimates, pending completion and filing of the Company's regulatory reports.

Presentation of Prior Period Financials

Certain prior period amounts in the financial statements presented in this earnings release have been re-stated from prior earnings releases, due to prior period adjustments as disclosed in the notes to the financial statements for the December 31, 2018 10-K.  Additional explanation will be included in Note 1 to the financial statements for the quarter ended March 31, 2019 as part of the Form 10-Q.

1

"Non-GAAP" financial measure. More information regarding this measurement and a reconciliation to the comparable GAAP measurement is provided under the heading Non-GAAP Financial Measures below.

Non-GAAP Financial Measures

In addition to results presented in accordance with generally accepted accounting principles in the United States of America (GAAP), this press release contains certain non-GAAP financial measures.  The Company believes that these non-GAAP financial measures provide investors with information useful in understanding the Company's financial performance; however, readers of this document are urged to review these non-GAAP financial measures in conjunction with the GAAP results as reported.

Management believes tangible common equity and the tangible common equity ratio are useful measures of capital adequacy because they provide a meaningful base for period-to-period and company-to-company comparisons, which management believes will assist investors in assessing the capital of the Company and the ability to absorb potential losses. Tangible common equity is calculated as total shareholders' equity less goodwill and other intangible assets, net (excluding MSRs). Tangible assets are total assets less goodwill and other intangible assets, net (excluding MSRs).  The tangible common equity ratio is calculated as tangible common shareholders' equity divided by tangible assets.

The following table provides reconciliations of ending shareholders' equity (GAAP) to ending tangible common equity (non-GAAP), and ending assets (GAAP) to ending tangible assets (non-GAAP).

(In thousands, except per share data)



Mar 31, 2019



Dec 31, 2018



Sep 30, 2018



Jun 30, 2018



Mar 31, 2018

Total shareholders' equity



$

4,112,326





$

4,056,442





$

4,003,893





$

3,981,087





$

3,969,766



Subtract:





















Goodwill



1,787,651





1,787,651





1,787,651





1,787,651





1,787,651



Other intangible assets, net



22,560





23,964





25,506





27,047





28,589



Tangible common shareholders' equity



$

2,302,115





$

2,244,827





$

2,190,736





$

2,166,389





$

2,153,526



Total assets



$

27,355,625





$

26,939,781





$

26,615,067





$

26,480,601





$

25,816,401



Subtract:





















Goodwill



1,787,651





1,787,651





1,787,651





1,787,651





1,787,651



Other intangible assets, net



22,560





23,964





25,506





27,047





28,589



Tangible assets



$

25,545,414





$

25,128,166





$

24,801,910





$

24,665,903





$

24,000,161



Common shares outstanding at period end



220,457





220,255





220,238





220,205





220,461

























Total shareholders' equity to total assets ratio



15.03

%



15.06

%



15.04

%



15.03

%



15.38

%

Tangible common equity ratio



9.01

%



8.93

%



8.83

%



8.78

%



8.97

%

Book value per common share



$

18.65





$

18.42





$

18.18





$

18.08





$

18.01



Tangible book value per common share



$

10.44





$

10.19





$

9.95





$

9.84





$

9.77



 

About Umpqua Holdings Corporation

Umpqua Holdings Corporation UMPQ is the parent company of Umpqua Bank, an Oregon-based community bank recognized for its entrepreneurial approach, innovative customer experience, and distinctive banking solutions. Umpqua Bank has locations across Oregon, Washington, California, Idaho and Nevada.  Umpqua Holdings also owns a retail brokerage subsidiary, Umpqua Investments, Inc., which has locations in Umpqua Bank stores and in dedicated offices in Oregon. Umpqua Holdings Corporation is headquartered in Portland, Oregon. For more information, visit umpquabank.com.

Earnings Conference Call Information

The Company will host its first quarter 2019 earnings conference call on Thursday, April 18, 2019, at 10:00 a.m. PT (1:00 p.m. ET).  During the call, the Company will provide an update on recent activities and discuss its first quarter 2019 financial results.  There will be a live question-and-answer session following the presentation.  To join the call, please dial (888) 394-8218 ten minutes prior to the start time and enter conference ID: 3915258.  A re-broadcast will be available approximately two hours after the call by dialing (888) 203-1112 and entering conference ID 3915258.  The earnings conference call will also be available as an audiocast, which can be accessed on the Company's investor relations page at umpquabank.com.

Forward-Looking Statements

This press release includes forward-looking statements within the meaning of the "Safe-Harbor" provisions of the Private Securities Litigation Reform Act of 1995, which management believes are a benefit to shareholders. These statements are necessarily subject to risk and uncertainty and actual results could differ materially due to various risk factors, including those set forth from time to time in our filings with the SEC. You should not place undue reliance on forward-looking statements and we undertake no obligation to update any such statements. In this press release we make forward-looking statements about fee income initiatives and MSR fair value volatility. Risks that could cause results to differ from forward-looking statements we make are set forth in our filings with the SEC and include, without limitation, prolonged low interest rate environment; the effect of interest rate increases on the cost of deposits; unanticipated weakness in loan demand or loan pricing; deterioration in the economy; lack of strategic growth opportunities or our failure to execute on those opportunities; our ability to effectively manage problem credits; our ability to successfully implement efficiency and operational excellence initiatives on time and in amounts projected; our ability to successfully develop and market new products and technology; and changes in laws or regulations.

 

Umpqua Holdings Corporation

Consolidated Statements of Income

(Unaudited)





Quarter Ended



% Change

(In thousands, except per share data)



Mar 31,

2019



Dec 31,

2018



Sep 30,

2018



Jun 30,

2018



Mar 31,

2018



Seq.

Quarter



Year

over

Year

Interest income:





























Loans and leases



$

258,747





$

254,093





$

246,410





$

242,123





$

229,488





2

%



13

%

Interest and dividends on investments:





























Taxable



19,956





27,381





24,435





8,499





15,699





(27)

%



27

%

Exempt from federal income tax



2,114





2,135





2,048





2,057





2,128





(1)

%



(1)

%

Dividends



517





538





549





433





468





(4)

%



10

%

Temporary investments and interest bearing deposits



925





2,621





2,800





2,080





1,164





(65)

%



(21)

%

Total interest income



282,259





286,768





276,242





255,192





248,947





(2)

%



13

%

Interest expense:





























Deposits



34,094





30,124





25,692





21,259





15,610





13

%



118

%

Securities sold under agreement to repurchase and federal funds purchased



810





185





103





155





63





338

%



1,186

%

Term debt



3,683





3,326





3,439





3,478





3,361





11

%



10

%

Junior subordinated debentures



5,987





5,743





5,640





5,400





4,932





4

%



21

%

Total interest expense



44,574





39,378





34,874





30,292





23,966





13

%



86

%

Net interest income



237,685





247,390





241,368





224,900





224,981





(4)

%



6

%

Provision for loan and lease losses



13,684





17,219





11,711





13,319





13,656





(21)

%



0

%

Non-interest income:





























Service charges on deposits



15,278





16,035





15,574





15,520





14,995





(5)

%



2

%

Brokerage revenue



3,810





4,178





3,947





4,161





4,194





(9)

%



(9)

%

Residential mortgage banking revenue, net



11,231





15,150





31,484





33,163





38,438





(26)

%



(71)

%

Gain on sale of investment securities, net















14









0

%



0

%

Unrealized holding gains (losses) on equity securities



695





410





(462)





(1,432)









70

%



nm

Gain on loan sales, net



769





2,484





2,772





1,348





1,230





(69)

%



(37)

%

BOLI income



2,168





2,116





2,051





2,060





2,070





2

%



5

%

Other income



11,789





16,438





17,022





16,817





17,640





(28)

%



(33)

%

Total non-interest income



45,740





56,811





72,388





71,651





78,567





(19)

%



(42)

%

Non-interest expense:





























Salaries and employee benefits



100,658





102,109





103,575





113,340





106,551





(1)

%



(6)

%

Occupancy and equipment, net



36,245





35,949





36,530





37,584





38,661





1

%



(6)

%

Intangible amortization



1,404





1,542





1,541





1,542





1,541





(9)

%



(9)

%

FDIC assessments



2,942





2,619





4,303





4,692





4,480





12

%



(34)

%

(Gain) loss on other real estate owned, net



(51)





1,125





(128)





(92)





(38)





(105)

%



34

%

Other expenses



30,394





35,144





33,471





38,506





34,918





(14)

%



(13)

%

Total non-interest expense



171,592





178,488





179,292





195,572





186,113





(4)

%



(8)

%

Income before provision for income taxes



98,149





108,494





122,753





87,660





103,779





(10)

%



(5)

%

Provision for income taxes



24,116





28,183





31,772





21,661





24,807





(14)

%



(3)

%

Net income



$

74,033





$

80,311





$

90,981





$

65,999





$

78,972





(8)

%



(6)

%































Weighted average basic shares outstanding



220,366





220,247





220,224





220,283





220,370





0

%



0

%

Weighted average diluted shares outstanding



220,655





220,668





220,620





220,647





220,825





0

%



0

%

Earnings per common share – basic



$

0.34





$

0.36





$

0.41





$

0.30





$

0.36





(6)

%



(6)

%

Earnings per common share – diluted



$

0.34





$

0.36





$

0.41





$

0.30





$

0.36





(6)

%



(6)

%































nm = not meaningful

 

Umpqua Holdings Corporation

Consolidated Balance Sheets

(Unaudited)

























% Change

(In thousands, except per share data)



Mar 31, 2019



Dec 31, 2018



Sep 30, 2018



Jun 30, 2018



Mar 31, 2018



Seq.

Quarter



Year

over

Year

Assets:





























Cash and due from banks



$

296,967





$

335,419





$

308,938





$

314,513





$

304,681





(11)

%



(3)

%

Interest bearing cash and temporary investments



605,841





287,218





570,321





488,499





264,508





111

%



129

%

Investment securities:





























Equity and other, at fair value



63,327





61,841





62,454





64,297





63,295





2

%



0

%

Available for sale, at fair value



2,894,778





2,977,108





2,864,394





2,854,398





2,947,414





(3)

%



(2)

%

Held to maturity, at amortized cost



3,478





3,606





3,672





3,586





3,667





(4)

%



(5)

%

Loans held for sale, at fair value



240,302





166,461





289,537





432,642





299,739





44

%



(20)

%

Loans and leases



20,405,997





20,422,666





19,854,033





19,639,494





19,255,347





0

%



6

%

Allowance for loan and lease losses



(144,872)





(144,871)





(144,026)





(144,556)





(141,933)





0

%



2

%

Net loans and leases



20,261,125





20,277,795





19,710,007





19,494,938





19,113,414





0

%



6

%

Restricted equity securities



47,466





40,268





40,269





42,320





43,501





18

%



9

%

Premises and equipment, net



217,595





227,423





237,456





245,954





259,354





(4)

%



(16)

%

Operating lease right-of-use assets



109,807





















nm



nm

Goodwill



1,787,651





1,787,651





1,787,651





1,787,651





1,787,651





0

%



0

%

Other intangible assets, net



22,560





23,964





25,506





27,047





28,589





(6)

%



(21)

%

Residential mortgage servicing rights, at fair value



158,946





169,025





175,038





166,217





164,760





(6)

%



(4)

%

Other real estate owned



10,488





10,958





11,774





12,101





13,055





(4)

%



(20)

%

Bank owned life insurance



314,303





313,626





311,922





309,844





307,745





0

%



2

%

Other assets



320,991





257,418





216,128





236,594





215,028





25

%



49

%

Total assets



$

27,355,625





$

26,939,781





$

26,615,067





$

26,480,601





$

25,816,401





2

%



6

%

Liabilities:





























Deposits



$

21,243,894





$

21,137,486





$

20,892,774





$

20,744,526





$

20,106,856





1

%



6

%

Securities sold under agreements to repurchase



288,944





297,151





286,975





273,666





291,984





(3)

%



(1)

%

Term debt



932,420





751,788





751,764





801,739





801,868





24

%



16

%

Junior subordinated debentures, at fair value



294,121





300,870





282,846





280,669





278,410





(2)

%



6

%

Junior subordinated debentures, at amortized cost



88,667





88,724





88,781





88,838





88,895





0

%



0

%

Operating lease liabilities



118,520





















nm



nm

Deferred tax liability, net



45,202





25,846





22,413





27,255





24,151





75

%



87

%

Other liabilities



231,531





281,474





285,621





282,821





254,471





(18)

%



(9)

%

Total liabilities



23,243,299





22,883,339





22,611,174





22,499,514





21,846,635





2

%



6

%

Shareholders' equity:





























Common stock



3,511,731





3,512,874





3,510,949





3,509,146





3,515,506





0

%



0

%

Retained earnings



629,877





602,482





568,619





524,031





502,214





5

%



25

%

Accumulated other comprehensive loss



(29,282)





(58,914)





(75,675)





(52,090)





(47,954)





(50)

%



(39)

%

Total shareholders' equity



4,112,326





4,056,442





4,003,893





3,981,087





3,969,766





1

%



4

%

Total liabilities and shareholders' equity



$

27,355,625





$

26,939,781





$

26,615,067





$

26,480,601





$

25,816,401





2

%



6

%































Common shares outstanding at period end



220,457





220,255





220,238





220,205





220,461





0

%



0

%

Book value per common share



$

18.65





$

18.42





$

18.18





$

18.08





$

18.01





1

%



4

%

Tangible book value per common share



$

10.44





$

10.19





$

9.95





$

9.84





$

9.77





2

%



7

%

Tangible equity - common



$

2,302,115





$

2,244,827





$

2,190,736





$

2,166,389





$

2,153,526





3

%



7

%

Tangible common equity to tangible assets



9.01

%



8.93

%



8.83

%



8.78

%



8.97

%



0.08





0.04



 

Umpqua Holdings Corporation

Loan and Lease Portfolio

(Unaudited)

(Dollars in thousands)



Mar 31, 2019



Dec 31, 2018



Sep 30, 2018



Jun 30, 2018



Mar 31, 2018



% Change





Amount



Amount



Amount



Amount



Amount



Seq.

Quarter



Year

over

Year

Loans and leases:





























Commercial real estate:





























Non-owner occupied term, net



$

3,476,972





$

3,573,065





$

3,527,357





$

3,518,982





$

3,519,366





(3)

%



(1)

%

Owner occupied term, net



2,449,648





2,480,371





2,474,845





2,473,734





2,464,705





(1)

%



(1)

%

Multifamily, net



3,302,936





3,304,763





3,225,538





3,185,923





3,103,794





0

%



6

%

Construction & development, net



686,107





736,254





646,684





568,562





522,670





(7)

%



31

%

Residential development, net



205,963





196,890





198,518





183,114





179,954





5

%



14

%

Commercial:





























Term, net



2,185,322





2,232,923





2,149,376





2,106,658





2,025,052





(2)

%



8

%

Lines of credit & other, net



1,229,092





1,169,525





1,133,508





1,152,853





1,147,123





5

%



7

%

Leases & equipment finance, net



1,378,686





1,330,155





1,282,128





1,265,843





1,228,709





4

%



12

%

Residential:





























Mortgage, net



3,768,955





3,635,073





3,468,569





3,405,775





3,275,088





4

%



15

%

Home equity loans & lines, net



1,170,252





1,176,477





1,143,351





1,132,329





1,103,048





(1)

%



6

%

Consumer & other, net



552,064





587,170





604,159





645,721





685,838





(6)

%



(20)

%

Total loans, net of deferred fees and costs



$

20,405,997





$

20,422,666





$

19,854,033





$

19,639,494





$

19,255,347





0

%



6

%































Loan and leases mix:





























Commercial real estate:





























  Non-owner occupied term, net



17

%



17

%



18

%



18

%



18

%









  Owner occupied term, net



12

%



12

%



13

%



13

%



13

%









  Multifamily, net



16

%



16

%



16

%



16

%



16

%









Construction & development, net



3

%



4

%



3

%



3

%



3

%









Residential development, net



1

%



1

%



1

%



1

%



1

%









Commercial:





























Term, net



11

%



11

%



11

%



11

%



11

%









Lines of credit & other, net



6

%



6

%



6

%



6

%



6

%









Leases & equipment finance, net



7

%



6

%



6

%



6

%



6

%









Residential:





























Mortgage, net



18

%



18

%



17

%



17

%



17

%









Home equity loans & lines, net



6

%



6

%



6

%



6

%



6

%









Consumer & other, net



3

%



3

%



3

%



3

%



3

%









Total



100

%



100

%



100

%



100

%



100

%









 

Umpqua Holdings Corporation

Deposits by Type/Core Deposits

(Unaudited)

(Dollars in thousands)



Mar 31, 2019



Dec 31, 2018



Sep 30, 2018



Jun 30, 2018



Mar 31, 2018



% Change





Amount



Amount



Amount



Amount



Amount



Seq.

Quarter



Year

over

Year

Deposits:





























Demand, non-interest bearing



$

6,495,562





$

6,667,467





$

6,859,411





$

6,819,325





$

6,699,399





(3)

%



(3)

%

Demand, interest bearing



2,341,441





2,340,471





2,320,560





2,321,691





2,354,873





0

%



(1)

%

Money market



6,469,286





6,645,390





6,325,808





6,161,907





6,546,704





(3)

%



(1)

%

Savings



1,479,509





1,492,685





1,499,872





1,465,154





1,482,560





(1)

%



0

%

Time



4,458,096





3,991,473





3,887,123





3,976,449





3,023,320





12

%



47

%

Total



$

21,243,894





$

21,137,486





$

20,892,774





$

20,744,526





$

20,106,856





1

%



6

%































Total core deposits (1)



$

17,903,754





$

18,190,402





$

18,012,992





$

17,743,888





$

18,007,169





(2)

%



(1)

%































Deposit mix:





























Demand, non-interest bearing



31

%



32

%



33

%



33

%



33

%









Demand, interest bearing



11

%



11

%



11

%



11

%



12

%









Money market



30

%



31

%



30

%



30

%



33

%









Savings



7

%



7

%



7

%



7

%



7

%









Time



21

%



19

%



19

%



19

%



15

%









Total



100

%



100

%



100

%



100

%



100

%







































Number of open accounts:





























Demand, non-interest bearing



406,039





406,240





404,913





402,771





399,721











Demand, interest bearing



76,712





77,099





77,546





77,918





78,181











Money market



56,602





56,196





55,895





55,393





54,752











Savings



161,039





161,656





162,387





162,414





162,841











Time



58,210





54,388





52,482





51,073





48,529











Total



758,602





755,579





753,223





749,569





744,024









































Average balance per account:





























Demand, non-interest bearing



$

16.0





$

16.4





$

16.9





$

16.9





$

16.8











Demand, interest bearing



30.5





30.4





29.9





29.8





30.1











Money market



114.3





118.3





113.2





111.2





119.6











Savings



9.2





9.2





9.2





9.0





9.1











Time



76.6





73.4





74.1





77.9





62.3











Total



$

28.0





$

28.0





$

27.7





$

27.7





$

27.0















(1)

Core deposits are defined as total deposits less time deposits greater than $100,000.

 

Umpqua Holdings Corporation

Credit Quality – Non-performing Assets

 (Unaudited)





Quarter Ended



% Change

(Dollars in thousands)



Mar 31,

2019



Dec 31,

2018



Sep 30,

2018



Jun 30,

2018



Mar 31,

2018



Seq.

Quarter



Year

over

Year

Non-performing assets:





























Loans and leases on non-accrual status



$

44,586





$

50,823





$

54,059





$

43,392





$

45,702





(12)

%



(2)

%

Loans and leases past due 90+ days and accruing (1)



31,424





36,444





33,812





34,535





25,456





(14)

%



23

%

Total non-performing loans and leases



76,010





87,267





87,871





77,927





71,158





(13)

%



7

%

Other real estate owned



10,488





10,958





11,774





12,101





13,055





(4)

%



(20)

%

Total non-performing assets



$

86,498





$

98,225





$

99,645





$

90,028





$

84,213





(12)

%



3

%































Performing restructured loans and leases



$

15,726





$

13,924





$

14,531





$

27,167





$

31,677





13

%



(50)

%

Loans and leases past due 31-89 days



$

53,009





$

37,373





$

33,825





$

44,734





$

38,569





42

%



37

%

Loans and leases past due 31-89 days to total loans and leases



0.26

%



0.18

%



0.17

%



0.23

%



0.20

%









Non-performing loans and leases to total loans and leases (1)



0.37

%



0.43

%



0.44

%



0.40

%



0.37

%









Non-performing assets to total assets(1)



0.32

%



0.36

%



0.37

%



0.34

%



0.33

%













(1)

Excludes non-performing mortgage loans guaranteed by Ginnie Mae, which Umpqua has the unilateral right to repurchase but has not done so, totaling $158,000, $8.9 million, $8.0 million, $9.2 million, and $6.3 million at March 31, 2019, December 31, 2018, September 30, 2018,  June 30, 2018, and March 31, 2018, respectively.

 

Umpqua Holdings Corporation

Credit Quality – Allowance for Loan and Lease Losses

 (Unaudited)





Quarter Ended



% Change

(Dollars in thousands)



Mar 31,

2019



Dec 31,

2018



Sep 30,

2018



Jun 30,

2018



Mar 31,

2018



Seq.

Quarter



Year over

Year

Allowance for loan and lease losses:





























Balance beginning of period



$

144,871





$

144,026





$

144,556





$

141,933





$

140,608











Provision for loan and lease losses



13,684





17,219





11,711





13,319





13,656





(21)

%



0

%

Charge-offs



(17,152)





(19,527)





(15,896)





(14,815)





(15,812)





(12)

%



8

%

Recoveries



3,469





3,153





3,655





4,119





3,481





10

%



0

%

 Net charge-offs



(13,683)





(16,374)





(12,241)





(10,696)





(12,331)





(16)

%



11

%

Total allowance for loan and lease losses



144,872





144,871





144,026





144,556





141,933





0

%



2

%

Reserve for unfunded commitments



4,654





4,523





4,294





4,130





4,129





3

%



13

%

Total allowance for credit losses



$

149,526





$

149,394





$

148,320





$

148,686





$

146,062





0

%



2

%































Net charge-offs to average loans and leases (annualized)



0.27

%



0.32

%



0.25

%



0.22

%



0.26

%









Recoveries to gross charge-offs



20.23

%



16.15

%



22.99

%



27.80

%



22.01

%









Allowance for loan and lease losses to loans and leases



0.71

%



0.71

%



0.73

%



0.74

%



0.74

%









Allowance for credit losses to loans and leases



0.73

%



0.73

%



0.75

%



0.76

%



0.76

%









 

Umpqua Holdings Corporation

Selected Ratios

(Unaudited)





Quarter Ended



% Change





Mar 31,

2019



Dec 31,

2018



Sep 30,

2018



Jun 30,

2018



Mar 31,

2018



Seq.

Quarter



Year

over

Year

Average Rates:





























Yield on loans held for sale



5.95

%



5.81

%



5.27

%



4.86

%



4.21

%



0.14





1.74



Yield on loans and leases



5.06

%



4.97

%



4.89

%



4.91

%



4.80

%



0.09





0.26



Yield on taxable investments



2.96

%



4.11

%



3.72

%



1.31

%



2.31

%



(1.15)





0.65



Yield on tax-exempt investments (1)



3.59

%



3.70

%



3.61

%



3.64

%



3.68

%



(0.11)





(0.09)



Yield on interest bearing cash and temporary investments



2.44

%



2.25

%



1.99

%



1.82

%



1.55

%



0.19





0.89



Total yield on earning assets (1)



4.79

%



4.81

%



4.67

%



4.41

%



4.43

%



(0.02)





0.36

































Cost of interest bearing deposits



0.97

%



0.85

%



0.73

%



0.62

%



0.47

%



0.12





0.50



Cost of securities sold under agreements to repurchase and fed funds purchased



0.88

%



0.26

%



0.15

%



0.22

%



0.08

%



0.62





0.80



Cost of term debt



1.88

%



1.75

%



1.73

%



1.74

%



1.70

%



0.13





0.18



Cost of junior subordinated debentures



6.24

%



6.13

%



6.06

%



5.89

%



5.36

%



0.11





0.88



Total cost of interest bearing liabilities



1.14

%



1.00

%



0.90

%



0.80

%



0.65

%



0.14





0.49

































Net interest spread (1)



3.65

%



3.81

%



3.77

%



3.61

%



3.78

%



(0.16)





(0.13)



Net interest margin (1)



4.03

%



4.15

%



4.09

%



3.89

%



4.00

%



(0.12)





0.03

































Performance Ratios:





























Return on average assets



1.12

%



1.19

%



1.36

%



1.02

%



1.25

%



(0.07)





(0.13)



Return on average tangible assets



1.20

%



1.28

%



1.46

%



1.09

%



1.35

%



(0.08)





(0.15)



Return on average common equity



7.34

%



7.90

%



9.00

%



6.64

%



8.06

%



(0.56)





(0.72)



Return on average tangible common equity



13.17

%



14.34

%



16.42

%



12.18

%



14.84

%



(1.17)





(1.67)



Efficiency ratio – Consolidated



60.44

%



58.58

%



57.06

%



65.84

%



61.21

%



1.86





(0.77)



Efficiency ratio – Bank



58.57

%



57.67

%



54.70

%



63.04

%



59.24

%



0.90





(0.67)







(1)

Tax exempt interest has been adjusted to a taxable equivalent basis using a 21% tax rate.

 

Umpqua Holdings Corporation

Average Balances

(Unaudited)





Quarter Ended



% Change

(Dollars in thousands)



Mar 31,

2019



Dec 31,

2018



Sep 30,

 2018



Jun 30,

2018



Mar 31,

2018



Seq.

Quarter



Year

over

Year

Temporary investments and interest bearing cash



$

153,347





$

462,621





$

558,597





$

458,133





$

303,670





(67)

%



(50)

%

Investment securities, taxable



2,757,644





2,716,616





2,687,635





2,723,406





2,793,449





2

%



(1)

%

Investment securities, tax-exempt



287,366





282,998





278,937





279,158





286,603





2

%



0

%

Loans held for sale



187,656





238,958





320,494





326,427





267,231





(21)

%



(30)

%

Loans and leases



20,388,988





20,051,674





19,709,113





19,387,537





19,089,713





2

%



7

%

Total interest earning assets



23,775,001





23,752,867





23,554,776





23,174,661





22,740,666





0

%



5

%

Goodwill and other intangible assets, net



1,811,007





1,812,487





1,814,000





1,815,529





1,817,068





0

%



0

%

Total assets



26,811,621





26,672,224





26,461,526





26,076,142





25,625,869





1

%



5

%































Non-interest bearing demand deposits



6,505,615





6,828,730





6,865,676





6,645,689





6,450,364





(5)

%



1

%

Interest bearing deposits



14,304,325





14,138,852





13,897,141





13,745,089





13,492,965





1

%



6

%

Total deposits



20,809,940





20,967,582





20,762,817





20,390,778





19,943,329





(1)

%



4

%

Interest bearing liabilities



15,858,561





15,547,250





15,331,529





15,199,900





14,971,759





2

%



6

%































Shareholders' equity - common



4,091,174





4,035,125





4,011,856





3,988,825





3,974,788





1

%



3

%

Tangible common equity (1)



2,280,167





2,222,638





2,197,856





2,173,296





2,157,720





3

%



6

%















(1) 

Average tangible common equity is a non-GAAP financial measure. Average tangible common equity is calculated as average common shareholders' equity less average goodwill and other intangible assets, net (excluding MSRs).

 

Umpqua Holdings Corporation

Average Rates and Balances

(unaudited)

(dollars in thousands)

Quarter Ended



March 31, 2019



December 31, 2018



March 31, 2018



Average

Balance



Interest

Income

or

Expense



Average

 Yields

or

Rates



Average

Balance



Interest

Income

or

Expense



Average

Yields

or

Rates



Average

Balance



Interest

Income

or

Expense



Average

Yields

or

Rates

INTEREST-EARNING ASSETS:



































Loans held for sale

$

187,656





$

2,790





5.95

%



$

238,958





$

3,473





5.81

%



$

267,231





$

2,815





4.21

%

Loans and leases (1)

20,388,988





255,957





5.06

%



20,051,674





250,620





4.97

%



19,089,713





226,673





4.80

%

Taxable securities

2,757,644





20,473





2.96

%



2,716,616





27,919





4.11

%



2,793,449





16,167





2.31

%

Non-taxable securities (2)

287,366





2,580





3.59

%



282,998





2,619





3.70

%



286,603





2,640





3.68

%

Temporary investments and interest-bearing cash

153,347





925





2.44

%



462,621





2,621





2.25

%



303,670





1,164





1.55

%

Total interest-earning assets

23,775,001





$

282,725





4.79

%



23,752,867





287,252





4.81

%



22,740,666





$

249,459





4.43

%

Other assets

3,036,620













2,919,357













2,885,203











Total assets

$

26,811,621













$

26,672,224













$

25,625,869











INTEREST-BEARING LIABILITIES:



































Interest-bearing demand deposits

$

2,319,718





$

2,640





0.46

%



$

2,319,613





$

2,659





0.45

%



$

2,323,232





$

1,210





0.21

%

Money market deposits

6,391,721





11,017





0.70

%



6,371,127





9,170





0.57

%



6,908,067





5,713





0.34

%

Savings deposits

1,488,530





270





0.07

%



1,488,768





490





0.13

%



1,463,058





163





0.05

%

Time deposits

4,104,356





20,167





1.99

%



3,959,344





17,805





1.78

%



2,798,608





8,524





1.24

%

Total interest-bearing deposits

14,304,325





34,094





0.97

%



14,138,852





30,124





0.85

%



13,492,965





15,610





0.47

%

Repurchase agreements and federal funds purchased

371,336





810





0.88

%



284,847





185





0.26

%



303,059





63





0.08

%

Term debt

793,797





3,683





1.88

%



751,773





3,326





1.75

%



802,297





3,361





1.70

%

Junior subordinated debentures

389,103





5,987





6.24

%



371,778





5,743





6.13

%



373,438





4,932





5.36

%

Total interest-bearing liabilities

15,858,561





$

44,574





1.14

%



15,547,250





$

39,378





1.00

%



14,971,759





$

23,966





0.65

%

Non-interest-bearing deposits

6,505,615













6,828,730













6,450,364











Other liabilities

356,271













261,119













228,958











Total liabilities

22,720,447













22,637,099













21,651,081











Common equity

4,091,174













4,035,125













3,974,788











Total liabilities and shareholders' equity

$

26,811,621













$

26,672,224













$

25,625,869











NET INTEREST INCOME





$

238,151













$

247,874













$

225,493







NET INTEREST SPREAD









3.65

%











3.81

%











3.78

%

NET INTEREST INCOME TO EARNING ASSETS OR NET INTEREST MARGIN (1), (2)









4.03

%











4.15

%











4.00

%





(1)

Non-accrual loans and leases are included in the average balance. 

(2)

Tax-exempt income has been adjusted to a tax equivalent basis at a 21% tax rate. The amount of such adjustment was an addition to recorded income of approximately $466,000 for the three months ended March 31, 2019 as compared to $484,000 for December 31, 2018 and $512,000 for March 31, 2018.

 

Umpqua Holdings Corporation

Residential Mortgage Banking Activity

(unaudited)





Quarter Ended



% Change

(Dollars in thousands)



Mar 31, 2019



Dec 31, 2018



Sep 30, 2018



Jun 30, 2018



Mar 31, 2018



Seq.

Quarter



Year over

Year

Residential mortgage servicing rights:





























Residential mortgage loans serviced for others



$

15,902,587





$

15,978,885





$

15,810,455





$

15,508,182





$

15,442,915





0

%



3

%

MSR asset, at fair value



158,946





169,025





175,038





166,217





164,760





(6)

%



(4)

%

MSR as % of serviced portfolio



1.00

%



1.06

%



1.11

%



1.07

%



1.07

%



(0.06)





(0.07)



Residential mortgage banking revenue:





























Origination and sale



$

14,373





$

16,665





$

20,983





$

28,159





$

22,837





(14)

%



(37)

%

Servicing



10,824





11,555





10,302





10,407





10,522





(6)

%



3

%

Change in fair value of MSR asset



(13,966)





(13,070)





199





(5,403)





5,079





7

%



(375)

%

Total



$

11,231





$

15,150





$

31,484





$

33,163





$

38,438





(26)

%



(71)

%































Closed loan volume:





























Closed loan volume - portfolio



$

318,612





$

312,524





$

323,941





$

294,581





$

237,783





2

%



34

%

Closed loan volume - for-sale



487,090





589,355





756,924





839,489





687,226





(17)

%



(29)

%

Closed loan volume - total



$

805,702





$

901,879





$

1,080,865





$

1,134,070





$

925,009





(11)

%



(13)

%































Gain on sale margin:





























Based on for-sale volume



2.95

%



2.83

%



2.77

%



3.35

%



3.32

%



0.12





(0.37)

































 

Cision View original content to download multimedia:http://www.prnewswire.com/news-releases/umpqua-reports-first-quarter-2019-results-300834092.html

SOURCE Umpqua Holdings Corporation

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