Market Overview

Glacier Bancorp, Inc. Announces Results for the Quarter Ended March 31, 2018

Share:

1st Quarter 2018 Highlights:

  • Net income of $38.6 million for the current quarter, an increase of $7.3 million, or 23 percent, over the prior year first quarter net income of $31.3 million.  Pre-tax income of $47.0 million for the current quarter, an increase of $5.9 million, or 15 percent, over the prior year first quarter pre-tax income of $41.0 million
  • Current quarter diluted earnings per share of $0.48, an increase of 17 percent from the prior year first quarter diluted earnings per share of $0.41.
  • Current quarter organic loan growth of $110.2 million, or 7 percent annualized.
  • Current quarter organic deposit growth of $144 million, or 8 percent annualized, with 20 percent of the increase in non-interest bearing deposits.
  • Dividend declared of $0.23 per share, an increase of $0.02 per share, or 10 percent, over the prior quarter.   The dividend was the 132nd consecutive quarterly dividend.
  • The Company completed the acquisition of Columbine Capital Corp., the holding company for Collegiate Peaks Bank, a community bank in Buena Vista, Colorado, with total assets of $551 million.
  • The Company completed the acquisition of Inter-Mountain Bancorp, Inc., the holding company for First Security Bank, a community bank in Bozeman, Montana, with total assets of $1.110 billion.
  • The Company surpassed $10 billion in total assets ending the quarter at $11.659 billion, an increase of $1.952 billion, or 20 percent, from the prior quarter.

In addition to the results presented in accordance with accounting principles generally accepted in the United States of America ("GAAP"), this press release contains certain non-GAAP financial measures.  The Company believes that providing these non-GAAP financial measures provides investors with information useful in understanding the Company's financial performance, performance trends, and financial position.  While the Company uses these non-GAAP measures in its analysis of the Company's performance, this information should not be considered an alternative to measurements required by GAAP.

The following table provides a reconciliation of certain GAAP financial measures to non-GAAP financial measures.  The reconciling item between the GAAP and non-GAAP financial measures consisted of the one-time net tax expense of $19.7 million during the three months ended December 31, 2017.  The one-time net tax expense was driven by the Tax Cuts and Jobs Act ("Tax Act") and the change in the federal marginal rate from 35 percent to 21 percent, which resulted in the revaluation of its deferred tax assets and deferred tax liabilities ("net deferred tax asset").  The Company believes that the financial results are more comparable excluding the impact of the revaluation of the net deferred tax asset.

Non-GAAP Financial Measures - Tax Cuts and Jobs Act

  Three Months ended
(Dollars in thousands, except per share data) Mar 31,
 2018
  Dec 31,
 2017
  Mar 31,
 2017
Net income (GAAP) $ 38,559     14,956     31,255  
Tax Act adjustment (GAAP)     19,699      
Net income (non-GAAP) $ 38,559     34,655     31,255  
Basic earnings per share (GAAP) $ 0.48     0.19     0.41  
Tax Act adjustment (GAAP)     0.25      
Basic earnings per share (non-GAAP) $ 0.48     0.44     0.41  
Diluted earnings per share (GAAP) $ 0.48     0.19     0.41  
Tax Act adjustment (GAAP)     0.25      
Diluted earnings per share (non-GAAP) $ 0.48     0.44     0.41  
Return on average assets (annualized) (GAAP) 1.50 %   0.61 %   1.35 %
Tax Act adjustment (GAAP) %   0.81 %   %
Return on average assets (annualized) (non-GAAP) 1.50 %   1.42 %   1.35 %
Return on average equity (annualized) (GAAP) 11.90 %   4.91 %   11.19 %
Tax Act adjustment (GAAP) %   6.47 %   %
Return on average equity (annualized) (non-GAAP) 11.90 %   11.38 %   11.19 %
Dividend payout ratio (annualized) (GAAP) 47.92 %   110.53 %   51.22 %
Tax Act adjustment (GAAP) %   (62.80 )%   %
Dividend payout ratio (annualized) (non-GAAP) 47.92 %   47.73 %   51.22 %
Effective tax rate (GAAP) 17.88 %   67.69 %   23.79 %
Tax Act adjustment (GAAP) %   (42.57 )%   %
Effective tax rate (non-GAAP) 17.88 %   25.12 %   23.79 %
 

Financial Highlights

  At or for the Three Months ended
(Dollars in thousands, except per share and market data) Mar 31,
 2018
  Dec 31,
 2017
  Mar 31,
 2017
Operating results          
Net income 1 $ 38,559     34,655     31,255  
Basic earnings per share 1 $ 0.48     0.44     0.41  
Diluted earnings per share 1 $ 0.48     0.44     0.41  
Dividends declared per share $ 0.23     0.21     0.21  
Market value per share          
Closing $ 38.38     39.39     33.93  
High $ 41.24     41.23     38.17  
Low $ 36.72     35.50     31.70  
Selected ratios and other data          
Number of common stock shares outstanding 84,511,472     78,006,956     76,619,952  
Average outstanding shares - basic 80,808,904     78,006,956     76,572,116  
Average outstanding shares - diluted 80,887,135     78,094,494     76,633,283  
Return on average assets (annualized) 1 1.50 %   1.42 %   1.35 %
Return on average equity (annualized) 1 11.90 %   11.38 %   11.19 %
Efficiency ratio 57.80 %   54.02 %   55.57 %
Dividend payout ratio 1 47.92 %   47.73 %   51.22 %
Loan to deposit ratio 81.83 %   87.29 %   78.91 %
Number of full time equivalent employees 2,492     2,278     2,224  
Number of locations 166     145     142  
Number of ATMs 222     200     195  

______________________________

1 Excludes a one-time revaluation of the deferred tax assets and deferred tax liabilities as a result of the Tax Act for the three months ended December 31, 2017.  For additional information on the revaluation, see the "Non-GAAP Financial Measures - Tax Cuts and Jobs Act" section above.

KALISPELL, Mont., April 19, 2018 (GLOBE NEWSWIRE) -- Glacier Bancorp, Inc. (NASDAQ:GBCI) reported net income of $38.6 million for the current quarter, an increase of $7.3 million, or 23 percent, from the $31.3 million of net income for the prior year first quarter.  Diluted earnings per share for the current quarter was $0.48 per share, an increase of $0.07, or 17 percent, from the prior year first quarter diluted earnings per share of $0.41.  Included in the current quarter was $1.8 million of acquisition-related expenses.  "I am very pleased to see the Glacier team post solid gains across all of our Company's key performance metrics.  This was accomplished during one of the busiest quarters in the Company's history, closing two of our largest acquisitions while continuing to grow our core business," said Randy Chesler, President and Chief Executive Officer.

On February 28, 2018, the Company completed the acquisition of Inter-Mountain Bancorp, Inc., the holding company for First Security Bank, a community bank in Bozeman, Montana (collectively, "FSB").  On January 31, 2018, the Company completed the acquisition of Columbine Capital Corp., the holding company for Collegiate Peaks Bank, a community bank in Buena Vista, Colorado (collectively, "Collegiate").  The Company's results of operations and financial condition include the acquisitions beginning on the acquisition dates and the following table discloses the preliminary fair value estimates of selected classifications of assets and liabilities acquired:

  FSB   Collegiate    
(Dollars in thousands) February 28,
 2018
  January 31,
 2018
  Total
Total assets $ 1,109,684     551,198     1,660,882  
Debt securities 271,865     42,177     314,042  
Loans receivable 627,767     354,252     982,019  
Non-interest bearing deposits 301,468     170,022     471,490  
Interest bearing deposits 576,118     267,149     843,267  
Borrowings 36,880     12,509     49,389  
                 

Asset Summary

              $ Change from
(Dollars in thousands) Mar 31,
 2018
  Dec 31,
 2017
  Mar 31,
 2017
  Dec 31,
 2017
  Mar 31,
 2017
Cash and cash equivalents $ 451,048     200,004     234,004     251,044     217,044  
Debt securities, available-for-sale 2,154,845     1,778,243     2,314,521     376,602     (159,676 )
Debt securities, held-to-maturity 634,413     648,313     667,388     (13,900 )   (32,975 )
Total debt securities 2,789,258     2,426,556     2,981,909     362,702     (192,651 )
Loans receivable                  
Residential real estate 831,021     720,728     685,458     110,293     145,563  
Commercial real estate 4,251,003     3,577,139     3,056,372     673,864     1,194,631  
Other commercial 1,839,293     1,579,353     1,462,110     259,940     377,183  
Home equity 489,879     457,918     433,554     31,961     56,325  
Other consumer 258,834     242,686     239,480     16,148     19,354  
Loans receivable 7,670,030     6,577,824     5,876,974     1,092,206     1,793,056  
Allowance for loan and lease losses (127,608 )   (129,568 )   (129,226 )   1,960     1,618  
Loans receivable, net 7,542,422     6,448,256     5,747,748     1,094,166     1,794,674  
Other assets 876,050     631,533     590,247     244,517     285,803  
Total assets $ 11,658,778     9,706,349     9,553,908     1,952,429     2,104,870  
 

The Company successfully executed its strategy to stay below $10 billion in total assets as of  December 31, 2017 to delay the impact of the Durbin Amendment for one additional year.  The Durbin Amendment, which was passed as part of Dodd-Frank, establishes limits on the amount of interchange fees that can be charged to merchants for debit card processing and will reduce the Company's service charge fee income in the future.  As a result, the Company's annual service charge fee income is expected to decline by approximately $14 - $16 million (pre-tax) beginning July 2019.  During the current quarter, the Company surpassed $10 billion in total assets ending the quarter at $11.659 billion, which was an increase of $1.952 billion, or 20 percent, from the prior quarter resulting from the current quarter acquisitions along with organic growth in loans and debt securities.

Total debt securities of $2.789 billion at March 31, 2018 increased $363 million, or 15 percent, during the current quarter and decreased $192.7 million, or 6 percent, from the prior year first quarter.  The current quarter increase was primarily due to the addition of the acquired banks.  Debt securities represented 24 percent of total assets at March 31, 2018 compared to 31 percent of total assets at March 31, 2017.

The loan portfolio increased $110 million, or 7 percent annualized, during the current quarter, excluding the FSB and Collegiate acquisitions.  The loan category with the largest increase was commercial real estate loans which increased $56.0 million, or 2 percent.  Excluding the current quarter acquisitions and the prior year acquisition of Foothills Bank ("Foothills"), the loan portfolio increased $519 million, or 9 percent, since March 31, 2017 and was primarily driven by growth in commercial real estate loans, which increased $346 million, or 11 percent.

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,
 2018
  Dec 31,
 2017
  Mar 31,
 2017
Allowance for loan and lease losses          
Balance at beginning of period $ 129,568     129,572     129,572  
Provision for loan losses 795     10,824     1,598  
Charge-offs (5,007 )   (19,331 )   (4,229 )
Recoveries 2,252     8,503     2,285  
Balance at end of period $ 127,608     129,568     129,226  
Other real estate owned $ 14,132     14,269     17,771  
Accruing loans 90 days or more past due 5,402     6,077     3,028  
Non-accrual loans 54,449     44,833     50,674  
Total non-performing assets $ 73,983     65,179     71,473  
Non-performing assets as a percentage of subsidiary assets 0.64 %   0.68 %   0.75 %
Allowance for loan and lease losses as a percentage of non-performing loans 213 %   255 %   241 %
Allowance for loan and lease losses as a percentage of total loans 1.66 %   1.97 %   2.20 %
Net charge-offs as a percentage of total loans 0.04 %   0.17 %   0.03 %
Accruing loans 30-89 days past due $ 44,963     37,687     39,160  
Accruing troubled debt restructurings $ 41,649     38,491     38,955  
Non-accrual troubled debt restructurings $ 13,289     23,709     19,479  
U.S. government guarantees included in non-performing assets $ 4,548     2,513     1,690  
                   

Non-performing assets at March 31, 2018 were $74.0 million, an increase of $8.8 million, or 14 percent, from December 31, 2017.  Non-performing assets as a percentage of subsidiary assets at March 31, 2018 was 0.64 percent which was a decrease of 4 basis points from the prior year end of 0.68 percent and a decrease of 11 basis points from prior year first quarter.  Early stage delinquencies (accruing loans 30-89 days past due) of $45.0 million at March 31, 2018 increased $7.3 million from the prior quarter and increased $5.8 million from the prior year which was also attributable to the acquired banks.  Early stage delinquencies as a percentage of loans at March 31, 2018 was 0.59 percent which was an increase of 2 basis points from the prior year end and a decrease of 8 basis points from prior year first quarter.  The allowance for loan and lease losses ("allowance") as a percent of total loans outstanding at March 31, 2018 was 1.66 percent, a decrease of 31 basis points from 1.97 percent at December 31, 2017.  This decrease was primarily driven by the addition of loans from new acquisitions, as they are added to the portfolio on a fair value basis and as a result do not require an allowance.

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 2018 $ 795     $ 2,755     1.66 %   0.59 %   0.64 %
Fourth quarter 2017 2,886     2,894     1.97 %   0.57 %   0.68 %
Third quarter 2017 3,327     3,628     1.99 %   0.45 %   0.67 %
Second quarter 2017 3,013     2,362     2.05 %   0.49 %   0.70 %
First quarter 2017 1,598     1,944     2.20 %   0.67 %   0.75 %
Fourth quarter 2016 1,139     4,101     2.28 %   0.45 %   0.76 %
Third quarter 2016 626     478     2.37 %   0.49 %   0.84 %
Second quarter 2016     (2,315 )   2.46 %   0.44 %   0.82 %

Net charge-offs for the current quarter were $2.8 million compared to $2.9 million for the prior quarter and $1.9 million from the same quarter last year.  Current quarter provision for loan losses was $795 thousand, compared to $2.9 million in the prior quarter and $1.6 million in 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,
 2018
  Dec 31,
 2017
  Mar 31,
 2017
  Dec 31,
 2017
  Mar 31,
 2017
Deposits                  
Non-interest bearing deposits $ 2,811,469     2,311,902     2,049,476     499,567     761,993  
NOW and DDA accounts 2,400,693     1,695,246     1,596,353     705,447     804,340  
Savings accounts 1,328,047     1,082,604     1,035,023     245,443     293,024  
Money market deposit accounts 1,778,068     1,512,693     1,516,731     265,375     261,337  
Certificate accounts 955,105     817,259     941,628     137,846     13,477  
Core deposits, total 9,273,382     7,419,704     7,139,211     1,853,678     2,134,171  
Wholesale deposits 145,463     160,043     340,946     (14,580 )   (195,483 )
Deposits, total 9,418,845     7,579,747     7,480,157     1,839,098     1,938,688  
Repurchase agreements 395,794     362,573     497,187     33,221     (101,393 )
Federal Home Loan Bank advances 155,057     353,995     211,627     (198,938 )   (56,570 )
Other borrowed funds 8,204     8,224     8,894     (20 )   (690 )
Subordinated debentures 134,061     126,135     126,027     7,926     8,034  
Other liabilities 92,793     76,618     94,776     16,175     (1,983 )
Total liabilities $ 10,204,754     8,507,292     8,418,668     1,697,462     1,786,086  
 

The Company added back $395 million of deposits during the current quarter that were previously moved off balance sheet as part of its strategy to stay below $10 billion in total assets through December 31, 2017.  Excluding the acquisitions and deposits moved back onto the balance sheet, core deposits increased $143 million, or 2 percent, from the prior quarter.  Excluding acquisitions, core deposit increased $523 million, or 7 percent, from the prior year first quarter.  Excluding acquisitions, non-interest bearing deposits increased $28.1 million, or 1 percent, from prior quarter and increased $193 million, or 9 percent, from the prior year.

Securities sold under agreements to repurchase ("repurchase agreements") of $396 million at March 31, 2018 increased $33.2 million, or 9 percent, from the prior quarter and decreased $101 million, or 20 percent, from the prior year first quarter.  Federal Home Loan Bank ("FHLB") advances of $155 million at March 31, 2018, decreased $199 million over prior quarter as that higher cost of funding was replaced with the deposits brought back onto the balance sheet.

Stockholders' Equity Summary

              $ Change from
(Dollars in thousands, except per share data) Mar 31,
 2018
  Dec 31,
 2017
  Mar 31,
 2017
  Dec 31,
 2017
  Mar 31,
 2017
Common equity $ 1,471,047     1,201,036     1,139,652     270,011     331,395  
Accumulated other comprehensive loss (17,023 )   (1,979 )   (4,412 )   (15,044 )   (12,611 )
Total stockholders' equity 1,454,024     1,199,057     1,135,240     254,967     318,784  
Goodwill and core deposit intangible, net (343,991 )   (191,995 )   (158,799 )   (151,996 )   (185,192 )
Tangible stockholders' equity $ 1,110,033     1,007,062     976,441     102,971     133,592  
                               
Stockholders' equity to total assets   12.47 %   12.35 %   11.88 %            
Tangible stockholders' equity to total tangible assets   9.81 %   10.58 %   10.39 %            
Book value per common share $ 17.21     15.37     14.82     1.84     2.39  
Tangible book value per common share $ 13.13     12.91     12.74     0.22     0.39  
                               

Tangible stockholders' equity of $1.110 billion at March 31, 2018 increased $103 million compared to the prior quarter which was the result of earnings retention, $181 million and $69.8 million of Company stock issued for the acquisitions of FSB and Collegiate, respectively; these increases more than offset the increase in goodwill and core deposit intangibles associated with the acquisitions.  Tangible book value per common share at quarter end increased $0.22 per share from the prior quarter and increased $0.39 per share from a year ago.

Cash Dividend
On March 28, 2018, the Company's Board of Directors declared a quarterly cash dividend of $0.23 per share, an increase of $0.02 per share, or 10 percent from the prior quarter.  The dividend was payable April 19, 2018 to shareholders of record on April 10, 2018.  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, 2018 
Compared to December 31, 2017 and March 31, 2017

Income Summary

  Three Months ended   $ Change from
(Dollars in thousands) Mar 31,
 2018
  Dec 31,
 2017
  Mar 31,
 2017
  Dec 31,
 2017
  Mar 31,
 2017
Net interest income                  
Interest income $ 103,066     96,898     87,628     6,168     15,438  
Interest expense 7,774     7,072     7,366     702     408  
     Total net interest income 95,292     89,826     80,262     5,466     15,030  
Non-interest income                  
Service charges and other fees 16,871     17,282     15,633     (411 )   1,238  
Miscellaneous loan fees and charges 1,477     1,077     980     400     497  
Gain on sale of loans 6,097     7,408     6,358     (1,311 )   (261 )
Loss on sale of investments (333 )   (115 )   (100 )   (218 )   (233 )
Other income 1,974     2,057     2,818     (83 )   (844 )
     Total non-interest income 26,086     27,709     25,689     (1,623 )   397  
     Total income $ 121,378     117,535     105,951     3,843     15,427  
Net interest margin (tax-equivalent) 4.10 %   4.23 %   4.03 %        
 

Net Interest Income
In the current quarter, interest income of $103 million increased $6.2 million, or 6 percent, from the prior quarter and increased $15.4 million, or 18 percent, over the prior year first quarter with both increases primarily attributable to the increase in interest income from commercial loans.  Interest income on commercial loans increased $4.2 million, or 7 percent, from the prior quarter and increased $15.5 million, or 31 percent, from the prior year first quarter.

The current quarter interest expense of $7.8 million increased $702 thousand, or 10 percent, from the prior quarter and increased $408 thousand, or 6 percent, from the prior year first quarter.  The total cost of funding (including non-interest bearing deposits) for the current quarter was 35 basis points compared to 33 basis points for the prior quarter and 37 basis points for the prior year first quarter.  The 2 basis points increase from the prior quarter was driven by the $395 million of higher cost deposits brought back onto the balance sheet during the current quarter.

The Company's net interest margin as a percentage of earning assets, on a tax-equivalent basis, for the current quarter was 4.10 percent compared to 4.23 percent in the prior quarter.  The 13 basis points decrease in the net interest margin was primarily the result of a 15 basis points decrease in the tax benefit related to the tax effect on certain earning assets as a result of the lower federal income tax rate in the current year.  The current quarter net interest margin increased 7 basis points over the prior year first quarter net interest margin of 4.03 percent even though there was a current quarter decrease of 15 basis points driven by the decrease in the federal income tax rate.  The increase in the core margin from the prior year first quarter resulted from the remix of earning assets to higher yielding loans and stable funding costs.  "The low cost core deposit funding base of Collegiate Peaks Bank and First Security Bank adds significant value to the Company, especially in higher interest rate environments," said Ron Copher, Chief Financial Officer.

Non-interest Income
Non-interest income for the current quarter totaled $26.1 million, a decrease of $1.6 million, or 6 percent, from the prior quarter and an increase of $397 thousand, or 2 percent, over the same quarter last year.  Service charges and other fees of $16.9 million, increased $1.2 million, or 8 percent, from the prior year first quarter primarily due to the increased number of accounts.  Gain on sale of loans decreased $1.3 million, or 18 percent, from the prior quarter and decreased $261 thousand from the prior year first quarter as a result of decreased refinance and purchase activity.  Other income of $2.0 million, decreased $844 thousand, or 30 percent, from the prior year first quarter due to the decrease in gain on sale of other real estate owned ("OREO").   Gain on sale of OREO during the first quarter of 2018 was $72.7 thousand compared to $967 thousand in the prior year first quarter.

Non-interest Expense Summary

  Three Months ended   $ Change from
(Dollars in thousands) Mar 31,
 2018
  Dec 31,
 2017
  Mar 31,
 2017
  Dec 31,
 2017
  Mar 31,
 2017
Compensation and employee benefits $ 45,721     40,465     39,246     5,256     6,475  
Occupancy and equipment 7,274     6,925     6,646     349     628  
Advertising and promotions 2,170     2,024     1,973     146     197  
Data processing 3,967     3,970     3,124     (3 )   843  
Other real estate owned 72     377     273     (305 )   (201 )
Regulatory assessments and insurance 1,206     1,069     1,061     137     145  
Core deposit intangibles amortization 1,056     614     601     442     455  
Other expenses 12,161     12,922     10,420     (761 )   1,741  
Total non-interest expense $ 73,627     68,366     63,344     5,261     10,283  
 

Compensation and employee benefits increased by $5.3 million, or 13 percent, from the prior year fourth quarter due to annual salary increases and the increased number of employees from acquisitions.  Occupancy and equipment expense increased $349 thousand, or 5 percent, over the prior quarter and increased $628 thousand, or 9 percent, over the prior year first quarter and was attributable to the acquisitions.  Data processing expense increased $843 thousand, or 27 percent, from the prior year first quarter as a result of acquisitions and volume driven cost increases.  Other expenses increased $1.7 million, or 17 percent from the prior year first quarter primarily from an increase in acquisition related expenses from the two acquisitions during the current quarter.  Acquisition related expenses were $1.8 million during the current quarter compared to $936 thousand in the prior quarter and $83 thousand in the prior year first quarter.

Federal and State Income Tax Expense
Tax expense during the first quarter of 2018 was $8.4 million, which is a decrease of $1.4 million, or 14 percent, from the prior year first quarter and was attributable to the decrease in the federal income tax rate driven by the Tax Act.  The effective tax rate in the first quarter of 2018 was 18 percent compared to 24 percent in the prior year first quarter.  Tax expense decreased $22.9 million from the prior quarter due to the one-time $19.7 million revaluation of the Company's net deferred tax asset and a decrease in the federal income tax rate in the current year.  Excluding the impact of the revaluation of the deferred tax asset, the effective federal and state income tax rate for the Company was 25 percent in the prior quarter.

Efficiency Ratio
The current quarter efficiency ratio was 57.8 percent, a 378 basis points increase from the prior quarter efficiency ratio of 54.02 percent.  The increase included 230 basis points related to the combined impact of the decrease in the federal income tax rate and the increase in acquisition related expenses.

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;
  • changes in the cost and scope of insurance from the Federal Deposit Insurance Corporation and other third parties;
  • legislative or regulatory changes, including increased banking and consumer protection regulation that adversely affect the Company's business, both generally and as a result of the Company exceeding $10 billion in total consolidated assets;
  • 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 reputation of banks and the financial services industry could deteriorate, which could adversely affect the Company's ability to obtain (and maintain) customers;
  • competition among financial institutions in the Company's markets may increase significantly;
  • 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;
  • the projected business and profitability of an expansion or the opening of a new branch could be lower than expected;
  • 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 Chief Executive Officer, the senior management team and the Presidents of Glacier Bank divisions;
  • material failure, potential interruption or breach in security of the Company's systems and technological changes which could expose us to new risks (e.g., cybersecurity), fraud or system failures;
  • natural disasters, including fires, floods, earthquakes, and other unexpected events;
  • the Company's success in managing risks involved in the foregoing; and
  • the effects of any reputational damage to the Company resulting from any of 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 20, 2018.  The conference call will be accessible by telephone and through the internet. Interested individuals are invited to listen to the call by dialing 877-561-2748 and conference ID 7466239. To participate on the webcast, log on to: https://edge.media-server.com/m6/p/zzte4xtt.  If you are unable to participate during the live webcast, the call will be archived on our website, www.glacierbancorp.com, or by calling 855-859-2056 with the ID 7466239 by May 4, 2018.

About Glacier Bancorp, Inc.
Glacier Bancorp, Inc. is the parent company for Glacier Bank, Kalispell and its bank divisions: First Security Bank of Missoula; Valley Bank of Helena; Western Security Bank, Billings; First Bank of Montana, Lewistown; and First Security Bank of Bozeman, all located in Montana; as well as Mountain West Bank, Coeur d'Alene, operating in Idaho, Utah and Washington; First Bank, Powell, operating in Wyoming and Utah; Citizens Community Bank, Pocatello, operating in Idaho; Bank of the San Juans, Durango; and Collegiate Peaks Bank, Buena Vista both operating in Colorado; First State Bank, Wheatland, operating in Wyoming; North Cascades Bank, Chelan, operating in Washington; and The Foothills Bank, Yuma, operating in Arizona.

 
Glacier Bancorp, Inc.
Unaudited Condensed Consolidated Statements of Financial Condition
 
(Dollars in thousands, except per share data) March 31,
 2018
  December 31,
 2017
  March 31,
 2017
Assets          
Cash on hand and in banks $ 140,625     139,948     124,501  
Federal funds sold 230         190  
Interest bearing cash deposits 310,193     60,056     109,313  
     Cash and cash equivalents 451,048     200,004     234,004  
Debt securities, available-for-sale 2,154,845     1,778,243     2,314,521  
Debt securities, held-to-maturity 634,413     648,313     667,388  
     Total debt securities 2,789,258     2,426,556     2,981,909  
Loans held for sale, at fair value 37,058     38,833     25,649  
Loans receivable 7,670,030     6,577,824     5,876,974  
Allowance for loan and lease losses (127,608 )   (129,568 )   (129,226 )
     Loans receivable, net 7,542,422     6,448,256     5,747,748  
Premises and equipment, net 238,491     177,348     175,283  
Other real estate owned 14,132     14,269     17,771  
Accrued interest receivable 54,376     44,462     48,043  
Deferred tax asset 32,929     38,344     64,575  
Core deposit intangible, net 54,456     14,184     11,746  
Goodwill 289,535     177,811     147,053  
Non-marketable equity securities 21,910     29,884     23,944  
Bank-owned life insurance 81,787     59,351     50,335  
Other assets 51,376     37,047     25,848  
     Total assets $ 11,658,778     9,706,349     9,553,908  
Liabilities          
Non-interest bearing deposits $ 2,811,469     2,311,902     2,049,476  
Interest bearing deposits 6,607,376     5,267,845     5,430,681  
Securities sold under agreements to repurchase 395,794     362,573     497,187  
FHLB advances 155,057     353,995     211,627  
Other borrowed funds 8,204     8,224     8,894  
Subordinated debentures 134,061     126,135     126,027  
Accrued interest payable 3,740     3,450     3,467  
Other liabilities 89,053     73,168     91,309  
     Total liabilities 10,204,754     8,507,292     8,418,668  
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 authorized 845     780     766  
Paid-in capital 1,048,860     797,997     749,381  
Retained earnings - substantially restricted 421,342     402,259     389,505  
Accumulated other comprehensive loss (17,023 )   (1,979 )   (4,412 )
     Total stockholders' equity 1,454,024     1,199,057     1,135,240  
     Total liabilities and stockholders' equity $ 11,658,778     9,706,349     9,553,908  
 


Glacier Bancorp, Inc.
Unaudited Condensed Consolidated Statements of Operations
 
  Three Months ended
(Dollars in thousands, except per share data) March 31,
 2018
  December 31,
 2017
  March 31,
 2017
Interest Income          
Debt securities $ 20,142     18,663     21,939  
Residential real estate loans 8,785     8,520     7,918  
Commercial loans 65,515     61,329     49,970  
Consumer and other loans 8,624     8,386     7,801  
     Total interest income 103,066     96,898     87,628  
Interest Expense          
Deposits 3,916     3,288     4,440  
Securities sold under agreements to repurchase 485     496     382  
Federal Home Loan Bank advances 2,089     2,106     1,510  
Other borrowed funds 16     24     15  
Subordinated debentures 1,268     1,158     1,019  
     Total interest expense 7,774     7,072     7,366  
Net Interest Income 95,292     89,826     80,262  
Provision for loan losses 795     2,886     1,598  
     Net interest income after provision for loan losses 94,497     86,940     78,664  
Non-Interest Income          
Service charges and other fees 16,871     17,282     15,633  
Miscellaneous loan fees and charges 1,477     1,077     980  
Gain on sale of loans 6,097     7,408     6,358  
Loss on sale of debt securities (333 )   (115 )   (100 )
Other income 1,974     2,057     2,818  
     Total non-interest income 26,086     27,709     25,689  
Non-Interest Expense          
Compensation and employee benefits 45,721     40,465     39,246  
Occupancy and equipment 7,274     6,925     6,646  
Advertising and promotions 2,170     2,024     1,973  
Data processing 3,967     3,970     3,124  
Other real estate owned 72     377     273  
Regulatory assessments and insurance 1,206     1,069     1,061  
Core deposit intangibles amortization 1,056     614     601  
Other expenses 12,161     12,922     10,420  
     Total non-interest expense 73,627     68,366     63,344  
Income Before Income Taxes 46,956     46,283     41,009  
Federal and state income tax expense 8,397     31,327     9,754  
Net Income $ 38,559     14,956     31,255  
 


Glacier Bancorp, Inc.
Average Balance Sheets
 
  Three Months ended
  March 31, 2018   March 31, 2017
(Dollars in thousands) Average
Balance
  Interest &
Dividends
  Average
Yield/
Rate
  Average
Balance
  Interest &
Dividends
  Average
Yield/
Rate
Assets                      
Residential real estate loans $ 783,817     $ 8,785     4.48 %   $ 709,432     $ 7,918     4.46 %
Commercial loans 1 5,551,619     66,474     4.86 %   4,372,299     51,335     4.76 %
Consumer and other loans 719,153     8,624     4.86 %   672,480     7,801     4.70 %
Total loans 2 7,054,589     83,883     4.82 %   5,754,211     67,054     4.73 %
Tax-exempt debt securities 3 1,093,736     12,795     4.68 %   1,245,358     17,761     5.70 %
Taxable debt securities 4 1,654,318     10,273     2.48 %   1,857,335     10,575     2.28 %
Total earning assets 9,802,643     106,951     4.42 %   8,856,904     95,390     4.37 %
Goodwill and intangibles 219,463             159,089          
Non-earning assets 390,857             369,274          
Total assets $ 10,412,963             $ 9,385,267          
Liabilities                      
Non-interest bearing deposits $ 2,472,151     $     %   $ 1,970,654     $     %
NOW and DDA accounts 2,011,464     818     0.16 %   1,575,928     247     0.06 %
Savings accounts 1,184,807     193     0.07 %   1,015,108     146     0.06 %
Money market deposit accounts 1,631,863     719     0.18 %   1,490,198     565     0.15 %
Certificate accounts 876,425     1,319     0.61 %   953,527     1,333     0.57 %
Wholesale deposits 5 149,577     867     2.35 %   332,255     2,149     2.62 %
FHLB advances 224,847     2,089     3.72 %   271,225     1,510     2.23 %
Repurchase agreements and other borrowed funds 521,641     1,769     1.38 %   562,628     1,416     1.02 %
Total funding liabilities 9,072,775     7,774     0.35 %   8,171,523     7,366     0.37 %
Other liabilities 25,973             81,419          
Total liabilities 9,098,748             8,252,942          
Stockholders' Equity                      
Common stock 808             766          
Paid-in capital 906,030             748,851          
Retained earnings 420,552             389,798          
Accumulated other comprehensive loss (13,175 )           (7,090 )        
Total stockholders' equity 1,314,215             1,132,325          
Total liabilities and stockholders' equity $ 10,412,963             $ 9,385,267          
Net interest income (tax-equivalent)     $ 99,177             $ 88,024      
Net interest spread (tax-equivalent)         4.07 %           4.00 %
Net interest margin (tax-equivalent)         4.10 %           4.03 %

______________________________

Includes tax effect of $959 thousand and $1.4 million on tax-exempt municipal loan and lease income for the three months ended March 31, 2018 and 2017, 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 $2.6 million and $6.1 million on tax-exempt debt securities income for the three months ended March 31, 2018 and 2017, respectively.
Includes tax effect of $304 thousand and $338 thousand on federal income tax credits for the three months ended March 31, 2018 and 2017, 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,
 2018
  Dec 31,
 2017
  Mar 31,
 2017
  Dec 31,
 2017
  Mar 31,
 2017
Custom and owner occupied construction $ 140,440     $ 109,555     $ 92,835     28 %   51 %
Pre-sold and spec construction 100,376     72,160     68,736     39 %   46 %
Total residential construction 240,816     181,715     161,571     33 %   49 %
Land development 76,528     82,398     78,042     (7 )%   (2 )%
Consumer land or lots 119,469     102,289     94,840     17 %   26 %
Unimproved land 68,862     65,753     66,857     5 %   3 %
Developed lots for operative builders 13,093     14,592     13,046     (10 )%   %
Commercial lots 43,232     23,770     26,639     82 %   62 %
Other construction 420,632     391,835     272,184     7 %   55 %
Total land, lot, and other construction 741,816     680,637     551,608     9 %   34 %
Owner occupied 1,292,206     1,132,833     988,544     14 %   31 %
Non-owner occupied 1,449,166     1,186,066     964,913     22 %   50 %
Total commercial real estate 2,741,372     2,318,899     1,953,457     18 %   40 %
Commercial and industrial 865,574     751,221     739,475     15 %   17 %
Agriculture 620,342     450,616     411,094     38 %   51 %
1st lien 1,014,361     877,335     839,387     16 %   21 %
Junior lien 66,288     51,155     54,801     30 %   21 %
Total 1-4 family 1,080,649     928,490     894,188     16 %   21 %
Multifamily residential 219,310     189,342     162,636     16 %   35 %
Home equity lines of credit 481,204     440,105     405,309     9 %   19 %
Other consumer 162,171     148,247     153,159     9 %   6 %
Total consumer 643,375     588,352     558,468     9 %   15 %
States and political subdivisions 421,252     383,252     329,461     10 %   28 %
Other 132,582     144,133     140,665     (8 )%   (6 )%
Total loans receivable, including loans held for sale 7,707,088     6,616,657     5,902,623     16 %   31 %
Less loans held for sale 1 (37,058 )   (38,833 )   (25,649 )   (5 )%   44 %
Total loans receivable $ 7,670,030     $ 6,577,824     $ 5,876,974     17 %   31 %

______________________________

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,
 2018
  Dec 31,
 2017
  Mar 31,
 2017
  Mar 31,
 2018
  Mar 31,
 2018
  Mar 31,
 2018
Custom and owner occupied construction $ 48     48                 48  
Pre-sold and spec construction 492     38     227     492          
Total residential construction 540     86     227     492         48  
Land development 7,802     7,888     8,856     775         7,027  
Consumer land or lots 1,622     1,861     1,728     743         879  
Unimproved land 10,294     10,866     12,017     8,638         1,656  
Developed lots for operative builders 83     116     116             83  
Commercial lots 1,312     1,312     1,255     260         1,052  
Other construction 319     151         181         138  
Total land, lot and other construction 21,432     22,194     23,972     10,597         10,835  
Owner occupied 12,594     13,848     17,956     10,483     552     1,559  
Non-owner occupied 5,346     4,584     3,194     4,751         595  
Total commercial real estate 17,940     18,432     21,150     15,234     552     2,154  
Commercial and industrial 6,313     5,294     4,466     4,956     1,312     45  
Agriculture 10,476     3,931     1,878     8,481     1,995      
1st lien 8,717     9,261     10,047     7,706     676     335  
Junior lien 4,271     567     1,335     3,979     242     50  
Total 1-4 family 12,988     9,828     11,382     11,685     918     385  
Multifamily residential 652         388     652          
Home equity lines of credit 3,312     3,292     6,008     2,207     465     640  
Other consumer 330     322     202     145     160     25  
Total consumer 3,642     3,614     6,210     2,352     625     665  
States and political subdivisions     1,800     1,800              
Total $ 73,983     65,179     71,473     54,449     5,402     14,132  


 
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,
 2018
  Dec 31,
 2017
  Mar 31,
 2017
  Dec 31,
 2017
  Mar 31,
 2017
Custom and owner occupied construction $ 611     $ 300     $ 380     104 %   61 %
Pre-sold and spec construction 267     102     488     162 %   (45 )%
Total residential construction 878     402     868     118 %   1 %
Land development 585             n/m     n/m  
Consumer land or lots 485     353     432     37 %   12 %
Unimproved land 889     662     938     34 %   (5 )%
Developed lots for operative builders 464     7         6,529 %   n/m  
Commercial lots 194     108     258     80 %   (25 )%
Other construction 76         7,125     n/m     (99 )%
Total land, lot and other construction 2,693     1,130     8,753     138 %   (69 )%
Owner occupied 13,904     4,726     6,686     194 %   108 %
Non-owner occupied 3,842     2,399     405     60 %   849 %
Total commercial real estate 17,746     7,125     7,091     149 %   150 %
Commercial and industrial 5,746     6,472     6,796     (11 )%   (15 )%
Agriculture 3,845     3,205     3,567     20 %   8 %
1st lien 9,597     10,865     7,132     (12 )%   35 %
Junior lien 240     4,348     848     (94 )%   (72 )%
Total 1-4 family 9,837     15,213     7,980     (35 )%   23 %
Multifamily Residential         2,028     n/m     (100 )%
Home equity lines of credit 2,316     1,962     703     18 %   229 %
Other consumer 1,849     2,109     1,317     (12 )%   40 %
Total consumer 4,165     4,071     2,020     2 %   106 %
Other 53     69     57     (23 )%   (7 )%
Total $ 44,963     $ 37,687     $ 39,160     19 %   15 %

______________________________

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,
 2018
  Dec 31,
 2017
  Mar 31,
 2017
  Mar 31,
 2018
  Mar 31,
 2018
Pre-sold and spec construction $ (339 )   (23 )   (11 )   17     356  
Total residential construction (339 )   (23 )   (11 )   17     356  
Land development (5 )   (143 )   (33 )       5  
Consumer land or lots (3 )   222     (57 )   169     172  
Unimproved land (73 )   (304 )   (96 )       73  
Developed lots for operative builders     (107 )   (5 )        
Commercial lots (2 )   (6 )   (2 )       2  
Other construction     389              
Total land, lot and other construction (83 )   51     (193 )   169     252  
Owner occupied 962     3,908     795     1,000     38  
Non-owner occupied (47 )   368     (1 )   15     62  
Total commercial real estate 915     4,276     794     1,015     100  
Commercial and industrial 1,430     883     344     1,539     109  
Agriculture (2 )   9     (3 )       2  
1st lien (65 )   (23 )   (15 )   4     69  
Junior lien (29 )   719     (16 )       29  
Total 1-4 family (94 )   696     (31 )   4     98  
Multifamily residential (6 )   (230 )           6  
Home equity lines of credit (32 )   272     12     12     44  
Other consumer 73     505     (11 )   142     69  
Total consumer 41     777     1     154     113  
Other 893     4,389     1,043     2,109     1,216  
Total $ 2,755     10,828     1,944     5,007     2,252  
 

Visit our website at www.glacierbancorp.com

CONTACT: Randall M. Chesler, CEO
(406) 751-4722
Ron J. Copher, CFO
(406) 751-7706

Primary Logo

View Comments and Join the Discussion!