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Section 1: 8-K (FORM 8-K)

Form 8-K

 

 

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

Form 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

January 23, 2018

Date of Report

(Date of Earliest Event Reported)

Synovus Financial Corp.

(Exact Name of Registrant as Specified in its Charter)

 

Georgia    1-10312    58-1134883
(State of Incorporation)    (Commission File Number)    (IRS Employer Identification No.)

1111 Bay Avenue, Suite 500, Columbus, Georgia 31901

(Address of principal executive offices) (Zip Code)

(706) 649-2311

(Registrant’s telephone number, including area code)

 

 

(Former name or former address, if changed since last report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 


Item 2.02 Results of Operations and Financial Condition

On January 23, 2018, Synovus Financial Corp. (the “Company”) issued a press release announcing the Company’s financial results for the three and twelve month periods ended December 31, 2017.

Pursuant to General Instruction F to Current Report on Form 8-K, the press release is attached to this Current Report as Exhibit 99.1 and only those portions of the press release related to the historical results of operations of the Company for the three and twelve month periods ended December 31, 2017 are incorporated into this Item 2.02 by reference. The information contained in this Item 2.02, including the information set forth in the press release filed as Exhibit 99.1 to, and incorporated in, this Current Report is being “furnished” and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that Section. The information in Exhibit 99.1 furnished pursuant to this Item 2.02 shall not be incorporated by reference into any registration statement or other documents pursuant to the Securities Act of 1933, as amended (the “Securities Act”), or into any filing or other document pursuant to the Exchange Act except as otherwise expressly stated in any such filing.

 

Item 7.01 Regulation FD Disclosure

On January 23, 2018, the Company made available the supplemental information (the “Supplemental Information”) and slide presentation (“Slide Presentation”) prepared for use with the press release. The investor call and webcast will be held at 8:30 a.m., ET, on January 23, 2018.

The information contained in this Item 7.01 of this Current Report, including the information set forth in the Supplemental Information and the Slide Presentation filed as Exhibits 99.2 and Exhibit 99.3 to, and incorporated in, this Current Report, is being “furnished” and shall not be deemed “filed” for the purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that Section. The information in Exhibit 99.2 and Exhibit 99.3 furnished pursuant to this Item 7.01 shall not be incorporated by reference into any registration statement or other documents pursuant to the Securities Act or into any filing or other document pursuant to the Exchange Act except as otherwise expressly stated in any such filing.

 

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

 

   

Exhibit
No.

  

Description

  99.1    Synovus press release dated January 23, 2018
  99.2    Supplemental Information prepared for use with the press release
  99.3    Slide presentation prepared for use with the press release


Signature

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, Synovus has caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

   

SYNOVUS FINANCIAL CORP.

(“Synovus”)

Dated: January 23, 2018     By:   /s/ Allan E. Kamensky
       

Allan E. Kamensky

Executive Vice President, General

Counsel and Secretary

(Back To Top)

Section 2: EX-99.1 (EX-99.1)

EX-99.1

Exhibit 99.1

 

LOGO

 

Media Contact

Lee Underwood

Media Relations

(706) 644-0528

  

Investor Contact

Steve Adams

Investor Relations

(706) 641-6462

Synovus Announces Earnings for the Fourth Quarter 2017 and a 67% Increase in Quarterly Common Dividend

Diluted Earnings per Share of $0.23 vs. $0.54 in 4Q16

Adjusted Diluted Earnings per Share of $0.72 vs. $0.54 in 4Q16

COLUMBUS, Ga., Jan. 23, 2018 – Synovus Financial Corp. (NYSE: SNV) today reported financial results for the quarter and year ended December 31, 2017.

Net income available to common shareholders for the fourth quarter 2017 was $27.0 million or $0.23 per diluted share as compared to $95.4 million or $0.78 per diluted share for the third quarter 2017 and $66.0 million or $0.54 per diluted share for the fourth quarter 2016. Fourth quarter 2017 results include a $23.2 million loss on early extinguishment of debt, as well as a $47.2 million charge related to Federal tax reform.1 Adjusted earnings per diluted share for the fourth quarter 2017 was $0.72, a 10.7% increase from the third quarter 2017 and a 32.4% increase from the fourth quarter 2016.

2017 Highlights

 

    Net income available to common shareholders for 2017 was $265.2 million or $2.17 per diluted share as compared to $236.5 million or $1.89 per diluted share for 2016. Diluted EPS grew 15.0% for 2017 compared to 2016.

 

    Adjusted earnings per diluted share for 2017 was $2.53 as compared to $1.98 for 2016, an increase of 27.7%.

 

    Return on average assets for 2017 was 0.89%, an increase of 5 basis points from 2016.

 

    Adjusted return on average assets for 2017 was 1.04%, an increase of 16 basis points from 2016.

 

    Return on average common equity for 2017 was 9.32%, an increase of 91 basis points from 2016.

 

    Adjusted return on average common equity for 2017 was 10.86%, an increase of 204 basis points from 2016.

 

    Total average loans for the year grew $1.28 billion or 5.5% as compared to 2016.

 

    Total loans ended the year at $24.79 billion, a $931.1 million or 3.9% increase from 2016.

 

    Total average deposits grew $1.49 billion or 6.3% as compared to 2016.

 

    Efficiency ratio of 59.95% improved 479 basis points from 2016.

 

    Adjusted efficiency ratio of 59.87% improved 280 basis points from 2016.

 

    Non-performing loans of $115.6 million at December 31, 2017, declined 24.7% from December 31, 2016, and the non-performing loan ratio declined 17 basis points from December 31, 2016, to 0.47% at December 31, 2017.

 

 

1  Certain components related to Federal tax reform impact are considered reasonable estimates or provisional amounts as defined by SEC Staff Accounting Bulletin No. 118. These amounts could be adjusted during the measurement period ending December 31, 2018.


    Returned $244.5 million to common shareholders during 2017 through $175.1 million in common share repurchases and $69.4 million in common stock dividends.

 

    Common Equity Tier 1 ratio was 9.99% at December 31, 2017, compared to 9.96% at December 31, 2016.

 

    Completed the Cabela’s transaction effective September 25, 2017.

 

    Completed the transition to a single-bank operating environment and began transitioning to a single brand — Synovus — across all markets.

“2017 was another outstanding year for Synovus, with strong financial and operating results,” said Kessel Stelling, Synovus chairman and CEO. “We achieved a number of long-term goals, including double-digit earnings-per-share growth, 1-plus percent adjusted ROA, and an efficiency ratio below 60 percent. The year was highlighted by our ranking as the country’s most reputable bank by Reputation Institute and American Banker, successful completion of the Cabela’s transaction, and implementation of a single-bank operating environment. We are pleased to begin 2018 by announcing a 67 percent increase in our common dividend, and our team is energized as we intensify our focus on improving the customer experience and complete the transition to a unified Synovus brand.”

Fourth Quarter Financial Results

Balance Sheet

 

    Total loans ended the quarter at $24.79 billion, up $300.1 million or 4.9% annualized from the previous quarter and up $931.1 million or 3.9% as compared to the fourth quarter 2016.

 

    Commercial and industrial loans grew by $297.7 million or 10.1% annualized from the previous quarter and $479.8 million or 4.2% as compared to the fourth quarter 2016.

 

    Consumer loans grew by $296.3 million or 21.2% annualized from the previous quarter and $889.4 million or 17.9% as compared to the fourth quarter 2016.

 

    Commercial real estate loans declined by $292.8 million or 16.1% annualized from the previous quarter and $438.8 million or 6.0% as compared to the fourth quarter 2016.

 

    Total average deposits for the quarter were $26.29 billion, up $999.1 million or 15.7% annualized from the previous quarter and up $1.62 billion or 6.6% as compared to the fourth quarter 2016.

 

    Average core transaction accounts2 grew by $188.6 million or 4.0% annualized from the previous quarter and $1.02 billion or 5.7% as compared to the fourth quarter 2016.

Core Performance

 

    Total revenues were $339.1 million compared to $398.0 million the previous quarter and $307.5 million for the fourth quarter 2016.

 

    Total adjusted revenues were $339.2 million, up $7.9 million or 2.4% from the previous quarter and up 12.1% from the fourth quarter 2016.

 

    Net interest income was $269.7 million, up $7.1 million or 2.7% from the previous quarter and up 15.5% from the fourth quarter 2016.

 

    Net interest margin was 3.65%, up 2 basis points from the previous quarter. Yield on earning assets was 4.15%, up 4 basis points from the previous quarter, and the effective cost of funds was 0.50%, up 2 basis points from the previous quarter.

 

    Total non-interest income was $69.4 million, down $66.1 million from the previous quarter and down $4.7 million from the fourth quarter 2016.

 

 

2  Consist of non-interest bearing, NOW/Savings, and money market deposits excluding SCMs.


    Third quarter 2017 non-interest income included the $75.0 million Cabela’s transaction fee, partially offset by $8.0 million in investment securities losses. Fourth quarter 2016 non-interest income included investment securities gains of $5.9 million.

 

    Adjusted non-interest income was $69.3 million, an increase of $835 thousand or 1.2% from the previous quarter and up 0.9% as compared to the fourth quarter 2016.

 

    Core banking fees3 were $33.0 million, down $121 thousand or 0.4% from the previous quarter and down 6.9% from the fourth quarter 2016.

 

    Fiduciary and asset management fees, brokerage revenue, and insurance revenues were $21.8 million, up $599 thousand or 2.8% from the previous quarter and 7.1% as compared to the fourth quarter 2016.

 

    Mortgage banking income was $5.6 million, up $42 thousand or 0.7% from the previous quarter and up 2.6% as compared to the fourth quarter 2016.

 

    Total non-interest expense was $226.5 million, up $20.9 million or 10.2% from the previous quarter and up 17.2% as compared to the fourth quarter 2016.

 

    Fourth quarter 2017 total non-interest expense includes a $23.2 million loss from the redemption of $300 million senior debt. Third quarter 2017 included other real estate and other impairment charges totaling $8.8 million.

 

    Efficiency ratio for the fourth quarter 2017 was 66.77% as compared to 50.62% in the previous quarter and 63.98% in the fourth quarter 2016.

 

    Adjusted non-interest expense was $201.1 million, up $7.0 million or 3.6% from the previous quarter and up 7.6% as compared to the fourth quarter 2016.

 

    The sequential quarter increase includes a $4.5 million increase in advertising, a one-time $1 thousand cash award to non-bonus plan participants totaling $3.3 million, and asset impairment charges on held for sale assets of $2.5 million.

 

    Adjusted efficiency ratio for the fourth quarter 2017 was 59.29% as compared to 58.59% in the previous quarter and 61.81% in the fourth quarter 2016.

Credit Quality

 

    Non-performing loans were $115.6 million at December 31, 2017, up $17.7 million or 18.1% from the previous quarter and down $37.8 million or 24.7% from December 31, 2016. The non-performing loan ratio was 0.47% at December 31, 2017, as compared to 0.40% at the end of the previous quarter and 0.64% at December 31, 2016.

 

    Total non-performing assets were $130.6 million at December 31, 2017, down $8.0 million or 5.8% from the previous quarter and down $45.1 million or 25.7% from December 31, 2016. The non-performing asset ratio was 0.53% at December 31, 2017, as compared to 0.57% at the end of the previous quarter and 0.74% at December 31, 2016.

 

    Net charge-offs were $9.0 million in the fourth quarter 2017, down $29.1 million or 76.4% from $38.1 million in the previous quarter. The annualized net charge-off ratio was 0.15% in the fourth quarter as compared to 0.62% in the previous quarter.

 

    Third quarter 2017 net charge-offs included $34.2 million related to loans transferred to held-for-sale.

 

 

3  Include service charges on deposit accounts, bankcard fees, letter of credit fees, ATM fee income, line of credit non-usage fees, gains from sales of government guaranteed loans, and miscellaneous other service charges.


    Total delinquencies (consisting of loans 30 or more days past due and still accruing) declined to 0.21% of total loans at December 31, 2017, as compared to 0.35% the previous quarter and 0.27% at December 31, 2016.

Capital Ratios

 

    Common Equity Tier 1 ratio was 9.99% at December 31, 2017, compared to 10.06% at September 30, 2017.

 

    Tier 1 Capital ratio was 10.38% at December 31, 2017, compared to 10.43% at September 30, 2017.

 

    Total Risk Based Capital ratio was 12.23% at December 31, 2017, compared to 12.30% at September 30, 2017.

 

    Tier 1 Leverage ratio was 9.19% at December 31, 2017, compared to 9.34% at September 30, 2017.

 

    Tangible Common Equity ratio was 8.88% at December 31, 2017, unchanged from September 30, 2017.

Capital Management

 

    During the fourth quarter, the Company repurchased $39.2 million in common stock as part of the $200 million share repurchase program authorized in the fourth quarter 2016. Share repurchases in 2017 totaled $175.1 million and resulted in a reduction of 4.0 million shares, a 3.3% share count reduction from December 31, 2016.

 

    Additionally, the Board of Directors authorized a new share repurchase program of up to $150 million of the Company’s common stock to be executed during 2018.

 

    The Board of Directors also approved a 67% increase in the Company’s quarterly common stock dividend from $0.15 to $0.25 per share, effective with the quarterly dividend payable in April 2018.

Fourth Quarter Earnings Conference Call

Synovus will host an earnings highlights conference call at 8:30 a.m. EDT on January 23, 2018. The earnings call will be accompanied by a slide presentation. Shareholders and other interested parties may listen to this conference call via simultaneous Internet broadcast. For a link to the webcast, go to investor.synovus.com/event. The replay will be archived for 12 months and will be available 30-45 minutes after the call.

Synovus Financial Corp. is a financial services company based in Columbus, Georgia, with approximately $31 billion in assets. Synovus provides commercial and retail banking, investment, and mortgage services through 250 branches in Georgia, Alabama, South Carolina, Florida, and Tennessee. Synovus Bank, a wholly owned subsidiary of Synovus, was recognized as the “Most Reputable Bank” by American Banker and the Reputation Institute in 2017. Synovus is on the web at synovus.com, on Twitter @synovus, and on LinkedIn at http://linkedin.com/company/synovus.

Forward-Looking Statements

This press release and certain of our other filings with the Securities and Exchange Commission contain statements that constitute “forward-looking statements” within the meaning of, and subject to the protections of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are forward-


looking statements. You can identify these forward-looking statements through Synovus’ use of words such as “believes,” “anticipates,” “expects,” “may,” “will,” “assumes,” “should,” “predicts,” “could,” “would,” “intends,” “targets,” “estimates,” “projects,” “plans,” “potential” and other similar words and expressions of the future or otherwise regarding the outlook for Synovus’ future business and financial performance and/or the performance of the banking industry and economy in general. These forward-looking statements include, among others, our expectations regarding deposits, loan growth and the net interest margin; expectations on our growth strategy, expense initiatives, capital management and future profitability; expectations on credit trends and key credit metrics; and the assumptions underlying our expectations. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve known and unknown risks and uncertainties which may cause the actual results, performance or achievements of Synovus to be materially different from the future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements are based on the information known to, and current beliefs and expectations of, Synovus’ management and are subject to significant risks and uncertainties. Actual results may differ materially from those contemplated by such forward-looking statements. A number of factors could cause actual results to differ materially from those contemplated by the forward-looking statements in this press release. Many of these factors are beyond Synovus’ ability to control or predict.

These forward-looking statements are based upon information presently known to Synovus’ management and are inherently subjective, uncertain and subject to change due to any number of risks and uncertainties, including, without limitation, the risks and other factors set forth in Synovus’ filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2016, under the captions “Cautionary Notice Regarding Forward-Looking Statements” and “Risk Factors” and in Synovus’ quarterly reports on Form 10-Q and current reports on Form 8-K. We believe these forward-looking statements are reasonable; however, undue reliance should not be placed on any forward-looking statements, which are based on current expectations and speak only as of the date that they are made. We do not assume any obligation to update any forward-looking statements as a result of new information, future developments or otherwise, except as otherwise may be required by law.


Non-GAAP Financial Measures

The measures entitled adjusted non-interest income; adjusted non-interest expense; adjusted total revenues; adjusted efficiency ratio; adjusted net income per common share, diluted; adjusted return on average assets; adjusted return on average common equity; adjusted return on average tangible common equity; average core deposits; average core transaction deposits; tangible common equity to tangible assets ratio; and common equity Tier 1 (CET1) ratio (fully phased-in); are not measures recognized under GAAP and therefore are considered non-GAAP financial measures. The most comparable GAAP measures to these measures are total non-interest income; total non-interest expense; total revenues; efficiency ratio; net income per common share, diluted; return on average assets; return on average common equity; total average deposits; the ratio of total shareholders’ equity to total assets; and the CET1 ratio; respectively.

Management believes that these non-GAAP financial measures provide meaningful additional information about Synovus to assist management and investors in evaluating Synovus’ operating results, financial strength, the performance of its business, and the strength of its capital position. However, these non-GAAP financial measures have inherent limitations as analytical tools and should not be considered in isolation or as a substitute for analyses of operating results or capital position as reported under GAAP. The non-GAAP financial measures should be considered as additional views of the way our financial measures are affected by significant items and other factors, and since they are not required to be uniformly applied, they may not be comparable to other similarly titled measures at other companies. Adjusted total revenues and adjusted non-interest income are measures used by management to evaluate total revenue and non-interest income exclusive of net investment securities gains/losses, changes in fair value of private equity investments, net, and the Cabela’s transaction fee. Adjusted non-interest expense and the adjusted efficiency ratio are measures utilized by management to measure the success of expense management initiatives focused on reducing recurring controllable operating costs. Adjusted net income per common share, diluted, adjusted return on average assets, and adjusted return on average common equity are measurements used by management to evaluate operating results exclusive of items that are not indicative of ongoing operations and impact period-to-period comparisons. Average core deposits and average core transaction deposits are measures used by management to evaluate organic growth of deposits and the quality of deposits as a funding source. The adjusted return on average tangible common equity is a measure used by management to compare Synovus’ performance with other financial institutions because it calculates the return available to common shareholders without the impact of intangible assets and their related amortization, thereby allowing management to evaluate the performance of the business consistently. The tangible common equity to tangible assets ratio and common equity Tier 1 (CET1) ratio (fully phased-in) are used by management and bank regulators to assess the strength of our capital position. The computations of these measures are set forth in the tables below.


Reconciliation of Non-GAAP Financial Measures

 

(dollars in thousands)    4Q17     3Q17     4Q16     2017     2016  

Adjusted non-interest income

          

Total non-interest income

   $ 69,352       135,435       74,006       345,327       273,194  

Subtract: Cabela’s transaction fee

     —         (75,000     —         (75,000     —    

Add/subtract: Investment securities losses (gains), net

     —         7,956       (5,885     289       (6,011

Subtract/add: (Increase)/decrease in fair value of private equity investments, net

     (100     27       499       3,093       1,026  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted non-interest income

   $ 69,252       68,418       68,620       273,709       268,209  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted non-interest expense

          

Total non-interest expense

   $ 226,534       205,646       193,209       821,313       755,923  

Subtract: 3Q17 discounts to fair value for completed or planned ORE accelerated dispositions

     —         (7,082     —         (7,082     —    

Subtract: 3Q17 asset impairment charges related to accelerated disposition of corporate real estate and other properties

     —         (1,168     —         (1,168     —    

Subtract: Earnout liability adjustments

     (1,700     (2,059     —         (3,759     —    

Add/subtract: Restructuring charges, net

     29       (519     (42     (7,014     (8,267

Subtract: Loss on early extinguishment of debt, net

     (23,160     —         —         (23,160     (4,735

Subtract: Fair value adjustment to Visa derivative

     —         —         (4,716     —         (5,795

Subtract: Litigation settlement/contingency expense

     (300     (401     —         (701     (2,511

Subtract: Merger-related expense

     —         (23     (1,086     (110     (1,636

Subtract: Amortization of intangibles

     (292     (292     (400     (1,059     (521
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted non-interest expense

   $ 201,111       194,102       186,965       777,260       732,458  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted efficiency ratio

          

Adjusted non-interest expense

   $ 201,111       194,102       186,965       777,260       732,458  

Net interest income

     269,713       262,572       233,530       1,023,309       899,180  

Add: Tax equivalent adjustment

     234       283       322       1,124       1,285  

Add: Total non-interest income

     69,352       135,435       74,006       345,327       273,194  

Add/subtract: Investment securities losses (gains), net

     —         7,956       (5,885     289       (6,011
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total FTE revenues

     339,299       406,246       301,973       1,370,049       1,167,648  

Subtract: Cabela’s transaction fee

     —         (75,000     —         (75,000     —    

Subtract/add: (Increase)/decrease in fair value of private equity investments, net

     (100     27       499       3,093       1,026  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted total revenues

   $ 339,199       331,273       302,472       1,298,142       1,168,674  

Efficiency ratio

     66.77     50.62       63.98       59.95       64.74  

Adjusted efficiency ratio

     59.29     58.59       61.81       59.87       62.67  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 


Reconciliation of Non-GAAP Financial Measures, continued

 

(dollars in thousands)    4Q17     3Q17     4Q16     2017     2016  

Adjusted net income per common share, diluted

          

Net income available to common shareholders

   $ 27,046       95,448       65,990       265,236       236,546  

Add: Earnout liability adjustments

     1,700       2,059       —         3,759       —    

Add: Income tax expense related to effect of Federal Tax Reform

     47,181       —         —         47,181       —    

Add: Merger-related expense

     —         23       1,086       110       1,636  

Add: Fair value adjustment to VISA derivative

     —         —         4,716       —         5,795  

Add: Litigation settlement/contingency expense

     300       401       —         701       2,511  

Subtract/add: Restructuring charges, net

     (29     519       42       7,014       8,267  

Add: Amortization of intangibles

     292       292       400       1,059       521  

Add: Loss on early extinguishment of debt, net

     23,160       —         —         23,160       4,735  

Add: 3Q17 provision expense on loans transferred to held-for-sale

     —         27,710       —         27,710       —    

Add: 3Q17 discounts to fair value for completed or planned ORE accelerated dispositions

     —         7,082       —         7,082       —    

Add: 3Q17 asset impairment charges related to accelerated disposition of corporate real estate and other properties

     —         1,168       —         1,168       —    

Add/subtract: Investment securities losses (gains), net

     —         7,956       (5,885     289       (6,011

Subtract/add: (Increase)/decrease in fair value of private equity investments, net

     (100     27       499       3,093       1,026  

Subtract: Cabela’s transaction fee

     —         (75,000     —         (75,000     —    

Subtract: Income tax benefit related to pre-2017 R&D credits and state taxes

     (4,847     —         —         (4,847     —    

Add/subtract: Tax effect of adjustments

     (8,740     11,034       (318     1,337       (6,838
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted net income

   $ 85,963       78,719       66,530       309,052       248,188  

Weighted average common shares outstanding-diluted

     120,182       121,814       123,187       122,012       125,078  

Adjusted net income per common share, diluted

   $ 0.72       0.65       0.54       2.53       1.98  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 


Reconciliation of Non-GAAP Financial Measures, continued

 

 

(dollars in thousands)    4Q17     3Q17     4Q16     2017     2016  

Adjusted return on average assets

          

Net income

   $ 29,605       98,007       68,549       275,474       246,784  

Add: Earnout liability adjustments

     1,700       2,059       —         3,759       —    

Add: Income tax expense related to effect of Federal Tax Reform

     47,181       —         —         47,181       —    

Add: Merger-related expense

     —         23       1,086       110       1,636  

Add: Fair value adjustment to VISA derivative

     —         —         4,716       —         5,795  

Add: Litigation settlement/contingency expense

     300       401       —         701       2,511  

Subtract/add: Restructuring charges, net

     (29     519       42       7,014       8,267  

Add: Amortization of intangibles

     292       292       400       1,059       521  

Add: Loss on early extinguishment of debt, net

     23,160       —         —         23,160       4,735  

Add: 3Q17 provision expense on loans transferred to held-for-sale

     —         27,710       —         27,710       —    

Add: 3Q17 discounts to fair value for completed or planned ORE accelerated dispositions

     —         7,082       —         7,082       —    

Add: 3Q17 asset impairment charges related to accelerated disposition of corporate real estate and other properties

     —         1,168       —         1,168       —    

Subtract/add: Investment securities losses (gains), net

     —         7,956       (5,885     289       (6,011

Subtract/add: (Increase)/decrease in fair value of private equity investments, net

     (100     27       499       3,093       1,026  

Subtract: Cabela’s transaction fee

     —         (75,000     —         (75,000     —    

Subtract: Income tax benefit related to pre-2017 R&D credits and state taxes

     (4,847     —         —         (4,847     —    

Subtract/add: Tax effect of adjustments

     (8,740     11,034       (318     1,337       (6,838
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted net income

   $ 88,522       81,278       69,089       319,290       258,426  

Net income annualized

   $ 351,201       322,462       274,854       319,290       258,426  

Total average assets

   $ 31,388,724       30,678,388       30,207,257       30,787,289       29,480,972  

Adjusted return on average assets

     1.12     1.05       0.91       1.04       0.88  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 


Reconciliation of Non-GAAP Financial Measures, continued

 

 

(dollars in thousands)    4Q17     3Q17     4Q16     2017     2016  

Adjusted return on average common equity

          

Net income available to common shareholders

   $ 27,046       95,448       65,990       265,236       236,546  

Add: Earnout liability adjustments

     1,700       2,059       —         3,759       —    

Add: Income tax expense related to effect of Federal Tax Reform

     47,181       —         —         47,181       —    

Add: Merger-related expense

     —         23       1,086       110       1,636  

Add: Fair value adjustment to VISA derivative

     —         —         4,716       —         5,795  

Add/subtract: Litigation settlement/ contingency expense

     300       401       —         701       2,511  

Subtract/add: Restructuring charges, net

     (29     519       42       7,014       8,267  

Add: Amortization of intangibles

     292       292       400       1,059       521  

Add: Loss on early extinguishment of debt, net

     23,160       —         —         23,160       4,735  

Add: 3Q17 provision expense on loans transferred to held-for-sale

     —         27,710       —         27,710       —    

Add: 3Q17 discounts to fair value for completed or planned ORE accelerated dispositions

       7,082       —         7,082       —    

Add: 3Q17 asset impairment charges related to accelerated disposition of corporate real estate and other properties

     —         1,168       —         1,168       —    

Add/subtract: Investment securities losses (gains), net

     —         7,956       (5,885     289       (6,011

Subtract/add: (Increase)/decrease in fair value of private equity investments, net

     (100     27       499       3,093       1,026  

Subtract: Cabela’s transaction fee

     —         (75,000     —         (75,000     —    

Subtract: Income tax benefit related to pre-2017 R&D credits and state taxes

     (4,847     —         —         (4,847     —    

Add/subtract: Tax effect of adjustments

     (8,740     11,034       (318     1,337       (6,838
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted net income

   $ 85,963       78,719       66,530       309,052       248,188  

Net income annualized

   $ 341,049       312,309       264,674       309,052       248,188  

Total average shareholders’ equity less preferred stock

   $ 2,851,523       2,859,491       2,786,707       2,844,570       2,813,526  

Subtract: Goodwill

     (57,315     (57,167     (55,144     (57,779     (32,151

Subtract: Other intangibles assets, net

     (11,353     (11,648     (233     (12,030     (269
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total average tangible shareholders’ equity less preferred stock

   $ 2,782,855       2,790,676       2,731,330       2,774,761       2,781,106  

Adjusted return on average common equity

     11.96     10.92       9.50       10.86       8.82  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Adjusted return on average tangible common equity

     12.26     11.19       9.69       11.14       8.92  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 


Reconciliation of Non-GAAP Financial Measures, continued

 

(dollars in thousands)    4Q17     3Q17     4Q16  

Tangible common equity to tangible assets ratio

      

Total assets

   $ 31,221,837       31,642,123       30,104,002  

Subtract: Goodwill

     (57,315     (57,315     (59,678

Subtract: Other intangible assets, net

     (11,254     (11,548     (13,223
  

 

 

   

 

 

   

 

 

 

Tangible assets

   $ 31,153,268       31,573,260       30,031,101  
  

 

 

   

 

 

   

 

 

 

Total shareholders’ equity

   $ 2,961,566       2,997,078       2,927,924  

Subtract: Goodwill

     (57,315     (57,315     (59,678

Subtract: Other intangible assets, net

     (11,254     (11,548     (13,223

Subtract: Series C Preferred Stock

     (125,980     (125,980     (125,980
  

 

 

   

 

 

   

 

 

 

Tangible common equity

   $ 2,767,017       2,802,235       2,729,043  
  

 

 

   

 

 

   

 

 

 

Total shareholder’s equity to total assets ratio

     9.49     9.47       9.73  

Tangible common equity to tangible assets ratio

     8.88     8.88       9.09  

Average core deposits and average core transaction deposits

      

Total average deposits

   $ 26,286,009       25,286,919       24,661,265  

Subtract: Average brokered deposits

     (2,198,333     (1,530,889     (1,380,931
  

 

 

   

 

 

   

 

 

 

Average core deposits

     24,087,676       23,756,030       23,280,334  

Subtract: Average time deposits excluding average SCM time deposits

     (3,084,272     (3,160,915     (3,147,620

Subtract: Average state, county, and municipal (SCM) deposits

     (2,211,686     (1,991,954     (2,356,567
  

 

 

   

 

 

   

 

 

 

Average core transaction deposits

   $ 18,791,718       18,603,161       17,776,147  
  

 

 

   

 

 

   

 

 

 

Common equity Tier 1 (CET1) ratio (fully phased-in)

      

Common Equity Tier 1 (CET1)

   $ 2,763,170      

Subtract: Adjustment related to capital components

     (17,147    
  

 

 

     

CET1 (fully phased-in)

   $ 2,746,023      
  

 

 

     

Total risk-weighted assets

   $ 27,672,344      

Total risk-weighted assets (fully phased-in)

   $ 27,787,437      

Common equity Tier 1 (CET 1) ratio

     9.99    

Common Equity Tier 1 (CET1) ratio (fully phased-in)

     9.88    
(Back To Top)

Section 3: EX-99.2 (EX-99.2)

EX-99.2

Exhibit 99.2

Synovus

INCOME STATEMENT DATA

(Unaudited)

(Dollars in thousands, except per share data)

 

     Twelve Months Ended  
     December 31,  
     2017     2016     Change  

Interest income

   $ 1,162,497       1,022,803       13.7

Interest expense

     139,188       123,623       12.6  
  

 

 

   

 

 

   

 

 

 

Net interest income

     1,023,309       899,180       13.8  

Provision for loan losses

     67,185       28,000       139.9  
  

 

 

   

 

 

   

 

 

 

Net interest income after provision for loan losses

     956,124       871,180       9.8  
  

 

 

   

 

 

   

 

 

 

Non-interest income:

      

Service charges on deposit accounts

     79,801       81,425       (2.0

Fiduciary and asset management fees

     50,485       46,594       8.4  

Brokerage revenue

     29,705       27,028       9.9  

Mortgage banking income

     22,798       24,259       (6.0

Bankcard fees

     32,232       33,318       (3.3

Cabela’s transaction fee

     75,000       —         nm  

Investment securities (losses) gains, net

     (289     6,011       nm  

Decrease in fair value of private equity investments, net

     (3,093     (1,026     nm  

Other fee income

     20,168       20,220       (0.3

Other non-interest income

     38,520       35,365       8.9  
  

 

 

   

 

 

   

 

 

 

Total non-interest income

     345,327       273,194       26.4  
  

 

 

   

 

 

   

 

 

 

Non-interest expense:

      

Salaries and other personnel expense

     433,321       402,026       7.8  

Net occupancy and equipment expense

     119,964       109,347       9.7  

Third-party processing expense

     54,708       46,320       18.1  

FDIC insurance and other regulatory fees

     27,011       26,714       1.1  

Professional fees

     26,232       26,698       (1.7

Advertising expense

     22,948       20,264       13.2  

Foreclosed real estate expense, net

     12,540       12,838       (2.3

Earnout liability adjustments

     5,466       —         nm  

Merger-related expense

     110       1,636       nm  

Amortization of intangibles

     1,059       521       nm  

Fair value adjustment to Visa derivative

     —         5,795       nm  

Loss on early extinguishment of debt, net

     23,160       4,735       nm  

Litigation settlement/contingency expense

     701       2,511       nm  

Restructuring charges, net

     7,014       8,267       (15.2

Other operating expenses

     87,079       88,251       (1.3
  

 

 

   

 

 

   

 

 

 

Total non-interest expense

     821,313       755,923       8.7  
  

 

 

   

 

 

   

 

 

 

Income before income taxes

     480,138       388,451       23.6  

Income tax expense

     204,664       141,667       44.5  
  

 

 

   

 

 

   

 

 

 

Net income

     275,474       246,784       11.6  

Dividends on preferred stock

     10,238       10,238       —    
  

 

 

   

 

 

   

 

 

 

Net income available to common shareholders

   $ 265,236       236,546       12.1
  

 

 

   

 

 

   

 

 

 

Net income per common share, basic

   $ 2.19       1.90       15.1

Net income per common share, diluted

     2.17       1.89       14.9  

Cash dividends declared per common share

     0.60       0.48       25.0  

Return on average assets

     0.89     0.84       5 bp 

Return on average common equity

     9.32       8.41       91  

Weighted average common shares outstanding, basic

     121,162       124,389       (2.6 )% 

Weighted average common shares outstanding, diluted

     122,012       125,078       (2.5

nm - not meaningful

bps - basis points


Synovus

INCOME STATEMENT DATA

(Unaudited)

(In thousands, except per share data)

 

     2017     2016     Fourth Quarter  
     Fourth
Quarter
    Third
Quarter
    Second
Quarter
    First
Quarter
    Fourth
Quarter
    ‘17 vs. ‘16
Change
 

Interest income

   $ 306,934       297,652       285,510       272,401       264,534       16.0

Interest expense

     37,221       35,080       34,413       32,474       31,004       20.1  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net interest income

     269,713       262,572       251,097       239,927       233,530       15.5  

Provision for loan losses

     8,565       39,686       10,260       8,674       6,259       36.8  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net interest income after provision for loan losses

     261,148       222,886       240,837       231,253       227,271       14.9  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Non-interest income:

            

Service charges on deposit accounts

     19,952       20,255       19,820       19,774       20,653       (3.4

Fiduciary and asset management fees

     13,195       12,615       12,524       12,151       11,903       10.9  

Brokerage revenue

     7,758       7,511       7,210       7,226       7,009       10.7  

Mortgage banking income

     5,645       5,603       5,784       5,766       5,504       2.6  

Bankcard fees

     7,893       7,901       8,253       8,185       8,330       (5.2

Cabela’s transaction fee

     —         75,000       —         —         —         nm  

Investment securities (losses) gains, net

     —         (7,956     (1     7,668       5,885       nm  

Increase/(decrease) in fair value of private equity investments, net

     100       (27     (1,352     (1,814     (499     nm  

Other fee income

     4,042       5,094       6,164       4,868       4,965       (18.6

Other non-interest income

     10,767       9,439       10,299       8,015       10,256       5.0  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total non-interest income

     69,352       135,435       68,701       71,839       74,006       (6.3
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Non-interest expense:

            

Salaries and other personnel expense

     111,243       109,675       105,213       107,191       101,662       9.4  

Net occupancy and equipment expense

     30,126       30,573       29,933       29,331       27,867       8.1  

Third-party processing expense

     14,827       13,659       13,620       12,603       12,287       20.7  

FDIC insurance and other regulatory fees

     6,288       7,078       6,875       6,770       6,614       (4.9

Professional fees

     6,183       7,141       7,551       5,355       6,904       (10.4

Advertising expense

     8,081       3,610       5,346       5,912       4,905       64.8  

Foreclosed real estate expense, net

     1,693       7,265       1,448       2,134       2,840       (40.4

Earnout liability adjustments

     1,700       2,059       1,707       —         —         nm  

Merger-related expense

     —         23       —         86       1,086       nm  

Amortization of intangibles

     292       292       292       183       400       (27.0

Fair value adjustment to Visa derivative

     —         —         —         —         4,716       nm  

Loss on early extinguishment of debt

     23,160       —         —         —         —         nm  

Litigation settlement expense

     300       401       —         —         —         nm  

Restructuring charges, net

     (29     519       13       6,511       42       nm  

Other operating expenses

     22,670       23,351       19,749       21,312       23,886       (5.1
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total non-interest expense

     226,534       205,646       191,747       197,388       193,209       17.2  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Income before income taxes

     103,966       152,675       117,791       105,704       108,068       (3.8

Income tax expense

     74,361       54,668       41,788       33,847       39,519       88.2  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income

     29,605       98,007       76,003       71,857       68,549       (56.8

Dividends on preferred stock

     2,559       2,559       2,559       2,559       2,559       —    
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income available to common shareholders

   $ 27,046       95,448       73,444       69,298       65,990       (59.0 )% 
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net income per common share, basic

   $ 0.23       0.79       0.60       0.57       0.54       (58.0 )% 

Net income per common share, diluted

     0.23       0.78       0.60       0.56       0.54       (58.0

Cash dividends declared per common share

     0.15       0.15       0.15       0.15       0.12       25.0  

Return on average assets *

     0.37     1.27       1.00       0.96       0.90       (53 ) bps 

Return on average common equity *

     3.76       13.24       10.34       9.97       9.42       (566

Weighted average common shares outstanding, basic

     119,282       120,900       122,203       122,300       122,341       (2.5 )% 

Weighted average common shares outstanding, diluted

     120,182       121,814       123,027       123,059       123,187       (2.4

nm - not meaningful

bps - basis points

* - ratios are annualized


Synovus

BALANCE SHEET DATA

(Unaudited)

(In thousands, except share data)

 

     December 31, 2017     September 30, 2017     December 31, 2016  

ASSETS

      

Cash and cash equivalents

   $ 397,848       386,459       395,175  

Interest bearing funds with Federal Reserve Bank

     460,928       1,297,581       527,090  

Interest earning deposits with banks

     26,311       6,047       18,720  

Federal funds sold and securities purchased under resale agreements

     47,846       48,820       58,060  

Trading account assets, at fair value

     3,820       12,329       9,314  

Mortgage loans held for sale, at fair value

     48,024       54,072       51,545  

Other loans held for sale

     11,356       31,253       —    

Investment securities available for sale, at fair value

     3,987,069       3,825,443       3,718,195  

Loans, net of deferred fees and costs

     24,787,464       24,487,360       23,856,391  

Allowance for loan losses

     (249,268     (249,683     (251,758
  

 

 

   

 

 

   

 

 

 

Loans, net

     24,538,196       24,237,677       23,604,633  
  

 

 

   

 

 

   

 

 

 

Premises and equipment, net

     426,813       423,245       417,485  

Goodwill

     57,315       57,315       59,678  

Other intangible assets

     11,254       11,548       13,223  

Other real estate

     3,758       10,551       22,308  

Deferred tax asset, net

     165,788       272,052       395,356  

Other assets

     1,035,511       967,731       813,220  
  

 

 

   

 

 

   

 

 

 

Total assets

   $ 31,221,837       31,642,123       30,104,002  
  

 

 

   

 

 

   

 

 

 

LIABILITIES AND SHAREHOLDERS’ EQUITY

      

Liabilities:

      

Deposits:

      

Non-interest bearing deposits

   $ 7,686,339       7,302,682       7,085,804  

Interest bearing deposits, excluding brokered deposits

     16,500,436       16,420,319       16,183,273  

Brokered deposits

     1,961,125       2,463,227       1,378,983  
  

 

 

   

 

 

   

 

 

 

Total deposits

     26,147,900       26,186,228       24,648,060  

Federal funds purchased and securities sold under repurchase agreements

     161,190       141,539       159,699  

Long-term debt

     1,706,138       1,882,607       2,160,881  

Other liabilities

     245,043       434,671       207,438  
  

 

 

   

 

 

   

 

 

 

Total liabilities

     28,260,271       28,645,045       27,176,078  
  

 

 

   

 

 

   

 

 

 

Shareholders’ equity:

      

Series C Preferred Stock - no par value, 5,200,000 shares outstanding at December 31, 2017, September 30, 2017, and December 31, 2016

     125,980       125,980       125,980  

Common stock - $1.00 par value. 118,897,295 shares outstanding at December 31, 2017, 119,566,625 shares outstanding at September 30, 2017, and 122,266,106 shares outstanding at December 31, 2016

     142,678       142,525       142,026  

Additional paid-in capital

     3,043,129       3,033,682       3,028,405  

Treasury stock, at cost - 23,780,154 shares at December 31, 2017, 22,958,514 shares at September 30, 2017, and 19,759,614 shares at December 31, 2016

     (839,674     (800,509     (664,595

Accumulated other comprehensive loss

     (54,754     (39,596     (55,659

Retained earnings

     544,207       534,996       351,767  
  

 

 

   

 

 

   

 

 

 

Total shareholders’ equity

     2,961,566       2,997,078       2,927,924  
  

 

 

   

 

 

   

 

 

 

Total liabilities and shareholders’ equity

   $ 31,221,837       31,642,123       30,104,002  
  

 

 

   

 

 

   

 

 

 


Synovus

AVERAGE BALANCES AND YIELDS/RATES (1)

(Unaudited)

(Dollars in thousands)

 

     2017     2016  
     Fourth     Third     Second     First     Fourth  
     Quarter     Quarter     Quarter     Quarter     Quarter  

Interest Earning Assets

          

Taxable investment securities (2)

   $ 3,937,278       3,786,436       3,844,688       3,841,556       3,643,510  

Yield

     2.29     2.11       2.11       2.06       1.92  

Tax-exempt investment securities (2) (4)

   $ 180       259       340       2,730       2,824  

Yield (taxable equivalent)

     7.97     7.86       6.87       5.81       5.82  

Trading account assets

   $ 7,360       7,823       3,667       6,443       6,799  

Yield

     2.78     2.09       2.28       1.72       2.63  

Commercial loans (3) (4)

   $ 18,935,774       19,059,936       19,137,733       19,043,384       18,812,659  

Yield

     4.49     4.41       4.27       4.16       4.05  

Consumer loans (3)

   $ 5,704,629       5,440,765       5,215,258       4,992,683       4,911,149  

Yield

     4.54     4.55       4.49       4.40       4.27  

Allowance for loan losses

   $ (252,319     (249,248     (251,219     (253,927     (253,713
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Loans, net (3)

   $ 24,388,084       24,251,453       24,101,772       23,782,140       23,470,095  

Yield

     4.55     4.49       4.36       4.25       4.14  

Mortgage loans held for sale

   $ 45,353       52,177       52,224       46,554       77,652  

Yield

     3.96     3.88       3.87       4.01       3.51  

Federal funds sold, due from Federal Reserve Bank, and other short-term investments

   $ 922,296       543,556       561,503       654,322       982,355  

Yield

     1.31     1.23       1.00       0.77       0.49  

Federal Home Loan Bank and Federal Reserve Bank stock (5)

   $ 159,455       175,263       177,323       170,844       121,079  

Yield

     4.03     3.50       2.99       3.42       3.75  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total interest earning assets

   $ 29,460,006       28,816,967       28,741,517       28,504,589       28,304,314  

Yield

     4.15     4.11       3.99       3.88       3.73  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Interest Bearing Liabilities

          

Interest bearing demand deposits

   $ 4,976,239       4,868,372       4,837,053       4,784,329       4,488,135  

Rate

     0.28     0.27       0.23       0.19       0.16  

Money market accounts

   $ 7,514,992       7,528,036       7,427,562       7,424,627       7,359,067  

Rate

     0.36     0.34       0.32       0.31       0.29  

Savings deposits

   $ 804,853       803,184       805,019       909,660       908,725  

Rate

     0.03     0.03       0.04       0.11       0.12  

Time deposits under $100,000

   $ 1,166,413       1,183,582       1,202,746       1,215,593       1,229,809  

Rate

     0.70     0.68       0.67       0.64       0.64  

Time deposits over $100,000

   $ 2,004,031       2,067,347       2,040,924       2,029,713       2,014,564  

Rate

     0.99     0.97       0.94       0.92       0.90  

Non maturing brokered deposits

   $ 546,413       547,466       564,043       619,627       638,779  

Rate

     0.81     0.73       0.54       0.41       0.31  

Brokered time deposits

   $ 1,651,920       983,423       815,515       761,159       742,153  

Rate

     1.63     1.16       0.94       0.92       0.90  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total interest bearing deposits

   $ 18,664,861       17,981,410       17,692,862       17,744,708       17,381,232  

Rate

     0.54     0.46       0.41       0.39       0.37  

Federal funds purchased and securities sold under repurchase agreements

   $ 184,369       191,585       183,400       176,854       219,429  

Rate

     0.15     0.08       0.10       0.09       0.08  

Long-term debt

   $ 1,713,982       1,985,175       2,270,452       2,184,072       2,190,716  

Rate

     2.67     2.81       2.83       2.83       2.65  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total interest bearing liabilities

   $ 20,563,212       20,158,170       20,146,714       20,105,634       19,791,377  

Rate

     0.72     0.69       0.68       0.65       0.62  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Non-interest bearing demand deposits

   $ 7,621,147       7,305,508       7,298,845       7,174,146       7,280,033  

Effective cost of funds

     0.50     0.48       0.48       0.46       0.44  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net interest margin

     3.65     3.63       3.51       3.42       3.29  
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Taxable equivalent adjustment

   $ 234       283       298       309       322  

 

(1) Yields and rates are annualized.
(2) Excludes net unrealized gains and losses.
(3) Average loans are shown net of unearned income. Non-performing loans are included.
(4) Reflects taxable-equivalent adjustments, using the statutory federal income tax rate of 35%, in adjusting interest on tax-exempt loans and investment securities to a taxable-equivalent basis.
(5) Included as a component of Other Assets on the consolidated balance sheet


Synovus

NON-PERFORMING LOANS COMPOSITION

(Unaudited)

(Dollars in thousands)

 

    Total     Total           Total        
    Non-performing     Non-performing           Non-performing        
    Loans     Loans     4Q17 vs. 3Q17     Loans     4Q17 vs. 4Q16  

Loan Type

  December 31, 2017     September 30, 2017     % change     December 31, 2016     % change  

Multi-Family

  $ 1,241       1,096       13.2   $ 1,853       (33.0 )% 

Hotels

    —         —         —         335       nm  

Office Buildings

    1,532       234       nm       1,380       11.0  

Shopping Centers

    165       327       (49.5     354       (53.4

Warehouses

    226       38       494.7       592       (61.8

Other Investment Property

    640       367       74.4       754       (15.1
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Investment Properties

    3,804       2,062       84.5       5,268       (27.8

1-4 Family Construction

    —         —         —         305       nm  

1-4 Family Investment Mortgage

    2,849       2,712       5.1       8,809       (67.7
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total 1-4 Family Properties

    2,849       2,712       5.1       9,114       (68.7

Commercial Development

    45       47       (4.3     168       (73.2

Residential Development

    3,257       4,720       (31.0     8,994       (63.8

Land Acquisition

    2,495       2,161       15.5       7,071       (64.7
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Land and Development

    5,797       6,928       (16.3     16,233       (64.3
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Commercial Real Estate

    12,450       11,702       6.4       30,615       (59.3
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Commercial, Financial, and Agricultural

    70,130       58,139       20.6       59,074       18.7  

Owner-Occupied

    6,654       3,960       68.0       16,503       (59.7
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Commercial & Industrial

    76,784       62,099       23.6       75,577       1.6  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Home Equity Lines

    17,455       15,638       11.6       21,551       (19.0

Consumer Mortgages

    7,203       6,332       13.8       22,681       (68.2

Other Consumer Loans

    1,669       2,067       (19.3     2,954       (43.5
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Consumer

    26,327       24,037       9.5       47,186       (44.2
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total

  $ 115,561       97,838       18.1   $ 153,378       (24.7 )% 
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

(1) Percentage change is annualized.

 

 

LOANS OUTSTANDING BY TYPE COMPARISON

(Unaudited)

(Dollars in thousands)

 

    Total Loans     Total Loans     4Q17 vs. 3Q17     Total Loans     4Q17 vs. 4Q16  

Loan Type

  December 31, 2017     September 30, 2017     % change (1)     December 31, 2016     % change  

Multi-Family

  $ 1,492,159       1,636,449       (35.0 )%    $ 1,568,234       (4.9 )% 

Hotels

    741,703       832,990       (43.5     748,951       (1.0

Office Buildings

    1,499,834       1,548,317       (12.4     1,539,516       (2.6

Shopping Centers

    791,311       840,367       (23.2     964,325       (17.9

Warehouses

    581,410       522,925       44.4       515,112       12.9  

Other Investment Property

    563,648       544,049       14.3       533,123       5.7  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Investment Properties

    5,670,065       5,925,097       (17.1     5,869,261       (3.4

1-4 Family Construction

    198,200       195,273       5.9       190,477       4.1  

1-4 Family Investment Mortgage

    583,419       600,535       (11.3     698,076       (16.4
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total 1-4 Family Properties

    781,619       795,808       (7.1     888,553       (12.0

Commercial Development

    70,062       66,521       21.1       70,250       (0.3

Residential Development

    114,079       117,878       (12.8     136,514       (16.4

Land Acquisition

    299,463       322,813       (28.7     409,534       (26.9
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Land and Development

    483,604       507,212       (18.5     616,298       (21.5
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Commercial Real Estate

    6,935,288       7,228,117       (16.1     7,374,112       (6.0
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Commercial, Financial, and Agricultural

    7,179,487       6,961,709       12.4       6,909,036       3.9  

Owner-Occupied

    4,844,163       4,764,240       6.7       4,634,770       4.5  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Commercial & Industrial

    12,023,650       11,725,949       10.1       11,543,806       4.2  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Home Equity Lines

    1,514,227       1,528,889       (3.8     1,617,265       (6.4

Consumer Mortgages

    2,633,503       2,557,680       11.8       2,296,604       14.7  

Credit Cards

    232,676       225,725       12.2       232,413       0.1  

Other Consumer Loans

    1,473,451       1,245,278       72.7       818,182       80.1  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total Consumer

    5,853,857       5,557,572       21.2       4,964,464       17.9  
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Unearned Income

    (25,331     (24,278     17.2       (25,991     (2.5
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total

  $ 24,787,464       24,487,360       4.9   $ 23,856,391       3.9
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

(1) Percentage change is annualized.


Synovus

CREDIT QUALITY DATA

(Unaudited)

(Dollars in thousands)

 

     2017      2016      4th Quarter  
     Fourth     Third      Second      First      Fourth      ‘17 vs. ‘16  
     Quarter     Quarter      Quarter      Quarter      Quarter      Change  

Non-performing Loans

   $ 115,561       97,838        159,317        158,366        153,378        (24.7 )% 

Impaired Loans Held for Sale (1)

     11,278       30,197        127        8,442        —          nm  

Other Real Estate

     3,758       10,551        19,476        20,425        22,308        (83.2
  

 

 

   

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Non-performing Assets

     130,597       138,586        178,920        187,233        175,686        (25.7

Allowance for loan losses

     249,268       249,683        248,095        253,514        251,758        (1.0

Net Charge-Offs - Quarter

     8,979       38,099        15,678        6,919        8,319     

Net Charge-Offs - YTD

     69,675       60,695        22,597        6,919        28,739     

Net Charge-Offs / Average Loans - Quarter (2)

     0.15     0.62        0.26        0.12        0.14     

Net Charge-Offs / Average Loans - YTD (2)

     0.29       0.33        0.19        0.12        0.12     

Non-performing Loans / Loans

     0.47       0.40        0.65        0.65        0.64     

Non-performing Assets / Loans, Other Loans Held for Sale & ORE

     0.53       0.57        0.73        0.77        0.74     

Allowance / Loans

     1.01       1.02        1.02        1.05        1.06     

Allowance / Non-performing Loans

     215.70       255.20        155.72        160.08        164.14     

Allowance / Non-performing Loans (3)

     238.44       336.35        217.07        204.94        202.01     

Past Due Loans over 90 days and Still Accruing

   $ 4,414       5,685        4,550        2,777        3,135        40.8  

As a Percentage of Loans Outstanding

     0.02     0.02        0.02        0.01        0.01     

Total Past Due Loans and Still Accruing

   $ 52,032       84,853        66,788        62,137        65,106        (20.1

As a Percentage of Loans Outstanding

     0.21     0.35        0.27        0.26        0.27     

Accruing Troubled Debt Restructurings (TDRs)

   $ 151,271       166,918        167,395        172,421        195,776        (22.7

 

(1) Represent only impaired loans that have been specifically identified to be sold. Impaired loans held for sale are carried at the lower of cost or fair value, less costs to sell, based primarily on estimated sales proceeds net of selling costs.
(2) Ratio is annualized.
(3) Excludes non-performing loans for which the expected loss has been charged off.

 

 

SELECTED CAPITAL INFORMATION (1)

(Unaudited)

(Dollars in thousands)

 

     December 31,
2017
    September 30,
2017
     December 31,
2016
 

Tier 1 Capital

   $ 2,872,003       2,849,580        2,685,880  

Total Risk-Based Capital

     3,383,083       3,362,127        3,201,268  

Common Equity Tier 1 Ratio (transitional)

     9.99     10.06        9.96  

Common Equity Tier 1 Ratio (fully phased-in)

     9.88       9.88        9.51  

Tier 1 Capital Ratio

     10.38       10.43        10.07  

Total Risk-Based Capital Ratio

     12.23       12.30        12.01  

Tier 1 Leverage Ratio

     9.19       9.34        8.99  

Common Equity as a Percentage of Total Assets (2)

     9.08       9.07        9.31  

Tangible Common Equity as a Percentage of Tangible Assets (3)

     8.88       8.88        9.09  

Tangible Common Equity as a Percentage of Risk Weighted Assets (3)

     10.00       10.24        10.24  

Book Value Per Common Share (4)

   $ 23.85       24.01        22.92  

Tangible Book Value Per Common Share (3)

     23.27       23.44        22.32  

 

(1) Current quarter regulatory capital information is preliminary.
(2) Common equity consists of Total Shareholders’ Equity less Preferred Stock.
(3) Excludes the carrying value of goodwill and other intangible assets from common equity and total assets.
(4) Book Value Per Common Share consists of Total Shareholders’ Equity less Preferred Stock divided by total common shares outstanding.
(Back To Top)

Section 4: EX-99.3 (EX-99.3)

EX-99.3

Slide 1

Fourth Quarter 2017 Results January 23, 2018 Exhibit 99.3


Slide 2

Forward Looking Statements This slide presentation and certain of our other filings with the Securities and Exchange Commission contain statements that constitute “forward-looking statements” within the meaning of, and subject to the protections of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are forward-looking statements. You can identify these forward-looking statements through Synovus’ use of words such as “believes,” “anticipates,” “expects,” “may,” “will,” “assumes,” “should,” “predicts,” “could,” “should,” “would,” “intends,” “targets,” “estimates,” “projects,” “plans,” “potential” and other similar words and expressions of the future or otherwise regarding the outlook for Synovus’ future business and financial performance and/or the performance of the banking industry and economy in general. These forward-looking statements include, among others, statements on (1) future loan growth; (2) future deposit growth; (3) future net interest income and net interest margin; (4) future adjusted non-interest income; (5) future non-interest expense levels, efficiency ratios, and operating leverage; (6) future credit trends and key metrics; (7) future effective tax rates; (8) our strategy and initiatives for future growth, capital management, strategic transactions and our brand initiative; and (9) our assumptions underlying these expectations. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve known and unknown risks and uncertainties which may cause the actual results, performance or achievements of Synovus to be materially different from the future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements are based on the information known to, and current beliefs and expectations of, Synovus’ management and are subject to significant risks and uncertainties. Actual results may differ materially from those contemplated by such forward-looking statements. A number of factors could cause actual results to differ materially from those contemplated by the forward-looking statements in this presentation. Many of these factors are beyond Synovus’ ability to control or predict. These forward-looking statements are based upon information presently known to Synovus’ management and are inherently subjective, uncertain and subject to change due to any number of risks and uncertainties, including, without limitation, the risks and other factors set forth in Synovus’ filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2016 under the captions “Cautionary Notice Regarding Forward-Looking Statements” and “Risk Factors” and in Synovus’ quarterly reports on Form 10-Q and current reports on Form 8-K. We believe these forward-looking statements are reasonable; however, undue reliance should not be placed on any forward-looking statements, which are based on current expectations and speak only as of the date that they are made. We do not assume any obligation to update any forward-looking statements as a result of new information, future developments or otherwise, except as otherwise may be required by law. Use of Non-GAAP Financial Measures This slide presentation contains certain non-GAAP financial measures determined by methods other than in accordance with generally accepted accounting principles. Such non-GAAP financial measures include the following: adjusted diluted earnings per share; adjusted return on average assets; adjusted return on average common equity; adjusted return on average tangible common equity; average loan growth excluding transfers to held-for-sale; average core deposits; average core transaction deposits; cost of interest bearing core deposits; adjusted non-interest income; adjusted non-interest expense; adjusted efficiency ratio; tangible common equity ratio; and common equity Tier 1 (CET1) ratio (fully phased-in). The most comparable GAAP measures to these measures are diluted earnings per share; return on average assets; return on average common equity; loan growth; total average deposits; effective cost of funds; total non-interest income; total non-interest expense; efficiency ratio; total shareholders’ equity to total assets ratio; and CET1 ratio, respectively. Management uses these non-GAAP financial measures to assess the performance of Synovus’ business and the strength of its capital position. Management believes that these non-GAAP financial measures provide meaningful additional information about Synovus to assist management, investors, and bank regulators in evaluating Synovus’ operating results, financial strength, the performance of its business and the strength of its capital position. However, these non-GAAP financial measures have inherent limitations as analytical tools and should not be considered in isolation or as a substitute for analyses of operating results or capital position as reported under GAAP. The non-GAAP financial measures should be considered as additional views of the way our financial measures are affected by significant items and other factors, and since they are not required to be uniformly applied, they may not be comparable to other similarly titled measures at other companies. Adjusted diluted earnings per share, adjusted return on average assets, and adjusted return on average common equity are measures used by management to evaluate operating results exclusive of items that are not indicative of ongoing operations and impact period-to-period comparisons. Adjusted return on average tangible common equity is a measure used by management to compare Synovus’ performance with other financial institutions because it calculates the return available to common shareholders without the impact of intangible assets and their related amortization, thereby allowing management to evaluate the performance of the business consistently. Loan growth excluding transfers to held-for-sale is a measure used by management to evaluate organic loan growth exclusive of loans transferred to held-for-sale. Average core deposits and average core transaction deposits are measures used by management to evaluate organic growth of deposits and the quality of deposits as a funding source. The cost of interest bearing core deposits is a measure used to evaluate the cost of deposits as a funding source exclusive of brokered deposits and non-interest bearing deposits. Adjusted non-interest income is a measure used by management to evaluate non-interest income exclusive of net investment securities gains/losses and changes in fair value of private equity investments, net, and the Cabela’s transaction fee. Adjusted non-interest expense and the adjusted efficiency ratio are measures utilized by management to measure the success of expense management initiatives focused on reducing recurring controllable operating costs. The tangible common equity ratio is used by management and bank regulators to assess the strength of our capital position. The computations of the non-GAAP financial measures used in this slide presentation are set forth in the Appendix to this slide presentation.


Slide 3

4Q17 Highlights 32.4% YoY (1) 21 b.p.s YoY (1) (In billions) 3.7% YoY Total Average Deposits (In billions) 6.6% YoY 21 b.p.s YoY Return on Average Common Equity (1) (1) (1) Non-GAAP financial measure; see appendix for applicable reconciliation. Annualized 246 b.p.s(1) YoY Diluted EPS of $0.23, compared to $0.78 in 3Q17 and $0.54 in 4Q16 Adjusted diluted EPS(1) of $0.72, up 10.7% vs. 3Q17 and 32.4% vs. 4Q16 ROA of 0.37%, down 90 b.p.s vs. 3Q17 and 53 b.p.s vs. 4Q16 Adjusted ROA(1) of 1.12%, up 7 b.p.s vs. 3Q17 and 21 b.p.s vs. 4Q16 Profitability Balance Sheet Growth Total average loans grew $111.7 million or 1.8%(2) vs. 3Q17 and $888.7 million or 3.7% vs. 4Q16 Total average deposits grew $999.0 million or 15.7%(2) vs. 3Q17 and $1.62 billion or 6.6% vs. 4Q16 Credit Quality and Capital Management NPA ratio of 0.53% improved 21 b.p.s from 4Q16 Return on average common equity of 3.76%; includes 640 b.p.s decline from Tax Reform effects Adjusted ROE(1) of 11.96% increased 246 b.p.s vs. 4Q16 Adjusted ROATCE(1) of 12.26% increased 257 b.p.s vs. 4Q16


Slide 4

4Q17 Items Excluded from Adjusted EPS and Other Select Items 4Q17 Items Excluded from Adjusted EPS Increase/(decrease) in Pre-tax Earnings After-tax Earnings Income tax expense related to effects of Federal Tax Reform N/A ($47.2) Income tax benefit related to pre-2017 R&D credits and state taxes N/A $4.8 Increase in earnout liability related to Global One acquisition ($1.7) ($1.7) Loss on early extinguishment of debt ($23.2) ($14.6) Other ($0.5) ($0.3) Net impact to 4Q17 earnings ($25.4) ($59.0) Net impact to 4Q17 diluted EPS ($0.49) 4Q17 Select Items Increase/(decrease) in Pre-tax Earnings After-tax Earnings Income tax benefit related to 2017 state taxes N/A $4.6 Asset impairment charges related to other assets held for sale ($2.5) ($1.6) One-time $1,000 cash award to non-bonus plan participants ($3.3) ($2.1) Net impact to 4Q17 earnings ($5.8) $0.9 Net impact to 4Q17 diluted EPS $0.01 (in millions, except per share data) Adjusted EPS is a non-GAAP financial measure. See appendix for adjusted EPS reconciliation. Certain components related to the Federal Tax Reform impact are considered reasonable estimates or provisional amounts as defined by SEC Staff Accounting Bulletin No. 118. These amounts could be adjusted during the measurement period ending December 31, 2018. See slide 17 in the appendix for additional information. Increase in fair value of earnout liability is due to the change in the enacted Federal income tax rate to 21% which results in an increase to the estimated earnout payments pursuant to the merger agreement. Items are included in the computation of adjusted EPS. (4) (1) (2) (3)


Slide 5

Loans Sequential quarter growth of $300.1 million or 4.9%(1) vs. 3Q17 C&I up $297.7 million or 10.1%(1) Consumer up $296.3 million or 21.2%(1) CRE down $292.8 million or 16.1%(1) Year-over-year growth of $931.1 million or 3.9% C&I up $479.8 million or 4.2% Consumer up $889.4 million or 17.9% CRE down $438.8 million or 6.0% Total average loan growth of $111.7 million or 1.8%(1) vs. 3Q17 and $888.7 million or 3.7% vs. 4Q16 Sequential quarter growth, excluding 3Q17 transfers to held for sale(2), of $189.5 million or 3.1%(1) (in billions) $23.86 $24.79 $24.49 48.5% 23.6% 27.9% 48.4% 20.8% 30.8% 47.8% 22.7% 29.5% Sequential quarter loan growth: $593.5 $56.8 $300.1 (in millions) Annualized Non-GAAP financial measure; see appendix for applicable reconciliation.


Slide 6

Deposits 4Q17 total average deposits of $26.29 billion increased $999.1 million or 15.7%(1) vs. 3Q17 4Q17 average core deposits(2)(3) increased $331.6 million or 5.5%(1) vs. 3Q17 Average core transaction deposits(2)(4), of $18.80 billion increased $188.6 million or 4.0%(1) vs. 3Q17 4Q17 total average deposits increased $1.62 billion or 6.6% vs. 4Q16 Average core transaction deposits(2)(3) increased $1.02 billion or 5.7% vs. 4Q16 Continue to enhance deposit mix with average non-interest bearing deposits increasing $139.2 million or 8.3%(1) vs. 3Q17 and $390.0 million or 6.3% vs. 4Q16 (in billions) $24.66 $26.29 $25.29 Total Average Deposits (5) (5) (5) Annualized Non-GAAP financial measure; see appendix for applicable reconciliation. Core deposits consist of total deposits excluding brokered deposits. Core transaction accounts consist of non-interest bearing, NOW/savings, and money market deposits excluding SCM deposits. Brokered deposits include a bank deposit sweep product offered to Synovus Securities customers. Average balances of these accounts totaled $326.9 million, $328.3 million, and $313.7 million for 4Q17, 3Q17, and 4Q16, respectively. Effective September 25, 2017, brokered deposits reflect the addition of the $1.1 billion in acquired WFB deposits. This addition increased 4Q17 and 3Q17 average brokered deposits by $1.1 billion and $72 million, respectively.


Slide 7

Net interest income Net interest income of $269.7 million increased $7.14 million or 2.7% vs. 3Q17 and 15.5% vs. 4Q16 Net interest margin of 3.65% up 2 b.p.s vs. 3Q17 Yield on earning assets of 4.15% up 4 b.p.s from 3Q17 Yield on loans of 4.55% up 6 b.p.s from 3Q17 Effective cost of funds of 0.50%(1) up 2 b.p.s from 3Q17 Cost of interest bearing core deposits(2) of 0.42% up 1 b.p. from 3Q17 (dollars in millions) See slide 30 in the appendix for computation. Non-GAAP financial measure; see appendix for applicable reconciliation.


Slide 8

Non-interest income 4Q17 non-interest income of $69.4 million decreased $66.1 million vs. 3Q17 and $4.7 million vs. 4Q16 3Q17 other income includes $75.0 million Cabela’s transaction fee, partially offset by $8.0 million in investment securities losses 4Q16 other income includes investment securities gains of $5.9 million Adjusted non-interest income(1) of $69.3 million increased $834 thousand or 1.2% vs. 3Q17 and $632 thousand or 0.9% vs. 4Q16 Core banking fees of $33.0 million declined $121 thousand or 0.4% vs. 3Q17 and decreased $2.4 million or 6.9% vs. 4Q16 The sequential quarter decline reflects a $302 thousand decrease in service charges on deposit accounts, partially offset by a $281 thousand increase in SBA/GGL gains to $1.5 million. Fiduciary/asset management, brokerage, and insurance revenues of $21.8 million increased $599 thousand or 2.8% vs. 3Q17 and $1.44 million or 7.1% vs. 4Q16 Assets under management of $13.98 billion increased 22.7% vs. 4Q16 (in millions) $74.0 $69.4 $135.4 (2) (2) Non-GAAP financial measure; see appendix for applicable reconciliation. Include service charges on deposit accounts, bankcard fees, letter of credit fees, ATM fee income, line of credit non-usage fees, gains from sales of government guaranteed loans, and miscellaneous other service charges. (2)


Slide 9

Non-interest expense 4Q17 non-interest expense of $226.5 million increased $20.9 million or 10.2% vs. 3Q17 and increased 17.2% vs. 4Q16 4Q17 adjusted non-interest expense(1) of $201.1 million increased $7.0 million or 3.6% vs. 3Q17 and increased $14.1 million or 7.6% vs. 4Q16 Sequential quarter increase driven by $4.5 million increase in advertising, one-time $1 thousand cash award to non-bonus plan participants ($3.3 million), and asset impairment charges on held for sale assets ($2.5 million) 4Q17 efficiency ratio of 66.77%; compared to 63.98% in 4Q16 $23.2 million loss on early extinguishment of debt increased 4Q17 efficiency ratio by 683 b.p.s 4Q17 adjusted efficiency ratio(1) of 59.29%; improved from 61.81% in 4Q16 (dollars in millions) Non-GAAP financial measure; see appendix for applicable reconciliation. Efficiency Ratio 63.98% 50.62% 66.77% Adjusted Efficiency Ratio(1) 61.81% 58.59% 59.29%


Slide 10

Credit quality (dollars in millions) (2) 0.14% 0.12% 0.26% 0.06% 0.15% 0.56% $8.3 $6.9 $15.7 $38.1 $9.0 Net Charge-offs(2) $27.7 Provision Expense Allowance for Loan Losses 1.06% 1.05% 1.02% 1.02% 1.01% 0.40% NPA, NPL, and Past Due Ratios Excludes impaired loans held for sale Net charge-off ratio is as a percentage of average total loans, annualized. (1) $39.7


Slide 11

Capital ratios 4Q16 3Q17 4Q17 Common equity Tier 1 ratio 9.96 % 10.06 9.99 Tier 1 capital ratio 10.07 10.43 10.38 Total risk-based capital ratio 12.01 12.30 12.23 Leverage ratio 8.99 9.34 9.19 Tangible common equity ratio(2) 9.09 8.88 8.88 Disallowed deferred tax asset(3) (in millions) $218.3 112.7 70.4 (1) Preliminary Non-GAAP financial measure; see appendix for applicable reconciliation. Tier 1 capital disallowed deferred tax asset; CET1 disallowed deferred tax asset is $56.3 million at December 31, 2017 compared to $90.2 million at September 30, 2017 and $131.0 million at December 31, 2016. The FASB has issued a proposal which would require reclassification from accumulated other comprehensive income to retained earnings of stranded tax effects solely related to the newly-enacted reduction in the Federal corporate income tax rate. If such proposal is approved, it would increase Synovus’ regulatory capital by $7.8 million at December 31, 2017, resulting in a 3 b.p. increase to CET1, Tier 1 Capital, and Total Risk Based Capital ratios, as well as a 2 b.p. increase to the Leverage ratio. 4Q17 common equity Tier 1 ratio on a fully phased-in basis estimated at 9.88%(1)(2) Completed $39.2 million in common share repurchases during the quarter and $175.1 million for the year (4) (1) (4) (1) (4) (4) (1)


Slide 12

Capital management – new $150 million share repurchase program and 67% dividend increase Repurchased $175 million in common stock (4.0 million shares at average price of $43.53) Share count reduced by 3.3%* Returned $244.5 million to common shareholders during the year with repurchases of $175.1 million in common stock and $69.4 million in common dividends The Board of Directors authorized a share repurchase program of up to $150 million to be completed during 2018 Size of repurchases will be based upon loan growth, liquidity, and capital optimization The Board of Directors approved a 67% increase in the quarterly common stock dividend to $0.25 per share Dividend increase will be effective with the quarterly dividend payable in April 2018 2017 Capital Actions 2018 Capital Actions * Number of shares repurchased in 2017 divided by shares outstanding at December 31, 2016.


Slide 13

2017 Summary 27.7% YoY (1) 16 b.p.s YoY (1) (In billions) 5.5% YoY Total Average Deposits (In billions) 6.3% YoY 21 b.p.s YoY Return on Average Common Equity (1) (1) (1) Non-GAAP financial measure; see appendix for applicable reconciliation. 204 b.p.s(1) YoY Diluted EPS of $2.17, up 15.0% Adjusted diluted EPS(1) of $2.53, up 27.7% Return on Average Assets of 0.89%, up 5 b.p.s Adjusted Return on Average Assets(1) of 1.04%, up 16 b.p.s Profitability Balance Sheet growth Total average loans grew $1.28 billion or 5.5% Total average deposits grew $1.49 billion or 6.3%(2) Credit quality and capital management NPA ratio of 0.53% improved 21 b.p.s Return on average common equity of 9.32%, up 91 b.p.s Adjusted ROE(1) of 10.86% increased 204 b.p.s Adjusted ROATCE(1) of 11.14% increased 222 b.p.s


Slide 14

2018 Outlook Metrics 2018 Outlook Balance Sheet   Average loan growth 4% to 6% Average total deposit growth 4% to 6%             Revenue   Net interest income growth 11% to 13%(1) Adjusted non-interest income(2) growth 4% to 6%         Non-interest Expense and Taxes   Total non-interest expense growth 0% to 3% Effective tax rate 23% to 24%         Credit and Capital   Net charge-off ratio 15 to 25 b.p.s Share repurchases Up to $150 million Common dividend per share (year) Up 67% to $1.00 Assumes a 25 b.p.s increase in the Federal funds rate in March and September 2018. If there are no increases in the Federal funds rate in 2018, net interest income is expected to increase by 9% to 11% in 2018. Non-GAAP financial measure; see appendix for applicable reconciliation. The Board of Directors approved a 66.7% increase in the quarterly common stock dividend to $0.25 per share, effective with the quarterly dividend payable in April 2018. (3)


Slide 15

Continued broad-based improvement Diluted Earnings Per Share Return on Average Assets Efficiency Ratio EPS 3-Year CAGR 20+% ROA ROTCE 1.35+% 15.00%+ Adjusted Efficiency Ratio <57% 2017 vs. 2014 change is calculated based on adjusted metrics. Non-GAAP financial measures; see appendix for applicable reconciliation. 20.7% CAGR (1) 25 b.p.s (1) Profitability Growth Efficiency Three-year targets 643 b.p.s (1) Reported Adjusted Return on Average Tangible Common Equity 418 b.p.s (1) Reported Adjusted Reported Adjusted


Slide 16


Slide 17

Components of effect from Federal Tax Reform included in 4Q17 Earnings (in thousands) Increase in 4Q17 Income Tax Expense(1) Remeasurement of deferred tax assets at the newly enacted 21% Federal income tax rate (excluding remeasurement of DTAs initially recorded through other comprehensive income) $38,328.6 Remeasurement of deferred tax assets, initially recorded through other comprehensive income, at the newly enacted 21% Federal income tax rate $7,762.8.0 Other increases in tax expense due to effects from Federal Tax Reform (includes impacts to LIHTC investments and valuation allowances) $1,089.3 Total increase in 4Q17 income tax expense due to effects from Federal Tax Reform $47,180.7 Net of state income tax benefit Certain components related to the Federal Tax Reform impact are considered reasonable estimates or provisional amounts as defined by SEC Staff Accounting Bulletin No. 118. These amounts could be adjusted during the measurement period ending December 31, 2018. Impact from $47.2 million increase in income tax expense due to effects from Federal Tax Reform is partially offset by a reduction in disallowed deferred tax assets. The FASB has issued a proposal which would require reclassification from accumulated other comprehensive income to retained earnings of stranded tax effects solely related to the newly-enacted reduction in the Federal corporate income tax rate. If such proposal is approved, it would increase Synovus’ regulatory capital by $7.8 million at December 31, 2017, resulting in a 3 b.p. increase to CET1, Tier 1 Capital, and Total Risk Based Capital ratios, as well as a 2 b.p. increase to the Leverage ratio. (2) (2) Impact of Federal Tax Reform Impact on 4Q17 Common equity Tier 1 ratio (5 b.p.s) Tier 1 capital ratio (5 b.p.s) Total risk based capital (5 b.p.s) Leverage ratio (5 b.p.s) Effect from Federal Tax Reform on Capital Ratios(3)(4) (2)


Slide 18

Condensed Income Statement (in thousands, except per share data) 4Q17 3Q17 4Q16 Net interest income $269,713 $262,572 $233,530 Adjusted non-interest income* 69,252 68,418 68,620 Adjusted non-interest expense* (201,112) (194,102) (186,965) Provision expense (8,565) (39,686) (6,259) Discounts to fair value – ORE dispositions - (7,082) - Asset impairment charges - (1,168) - Cabela’s transaction fee - 75,000 - Investment securities (losses) gains, net - (7,956) 5,885 Increase (decrease) in fair value of private equity investments, net 100 (27) (499) Restructuring charges, net 29 (519) (42) Litigation contingency/settlement expense (300) (401) - Earnout liability adjustments (1,700) (2,059) - Loss on early extinguishment of debt (23,160) - - Amortization of intangibles (292) (292) (400) Merger-related expense - (23) (1,086) Fair value of adjustment to Visa derivative - - (4,716) Income before taxes 103,965 152,675 108,068 Income tax expense 74,361 54,668 39,519 Dividends on preferred stock 2,559 2,559 2,559 Net income available to common shareholders $27,045 $95,448 $65,990 Net income per diluted common share $0.23 $0.78 $0.54 Average diluted common shares 120,182 121,814 123,187 *Non-GAAP financial measure; see applicable reconciliation


Slide 19

Quarterly Highlights Trend 4Q16 1Q17 2Q17 3Q17 4Q17 Diluted EPS $0.54 0.56 0.60 0.78 0.23 Financial Performance Net interest margin 3.29% 3.42 3.51 3.63 3.65 Adjusted efficiency ratio(1) 61.81 62.25 59.56 58.59 59.29 ROA(2) 0.90 0.96 1.00 1.27 0.37 Adjusted ROA(1)(2) 0.91 0.97 1.01 1.05 1.12 Balance Sheet Growth(3) Total loans 10.1% 6.8 2.8 0.9 4.9 Total average deposits 10.4 4.2 1.2 4.7 15.7 Credit Quality NPA ratio 0.74% 0.77 0.73 0.57 0.53 NCO ratio(2) 0.14 0.12 0.26 0.62 0.15 Capital Common shares outstanding(4) 122,266 122,322 121,661 119,567 118,897 CET1 ratio 9.96% 9.86 10.02 10.06 9.99 TCE ratio(1) 9.09 9.04 9.15 8.88 8.88 (1) Non-GAAP financial measure; see applicable reconciliation. (2) Annualized (3) Sequential quarter growth, annualized. (4) In thousands (5) Preliminary (5)


Slide 20

Net Interest Margin (2) Immediate change in short-term interest rates (in b.p.s) Estimated % increase in net interest income* +100 3.17% +25 1.54% Net Interest Income Sensitivity * As of December 31, 2017, $277 million or 1.1% of loans were at their floor rate, down from $679 million or 2.9% of total loans a year ago.


Slide 21

Non-interest Income (in thousands) 4Q16 3Q17 4Q17 4Q17 vs. 3Q17 % Change 4Q17 vs. 4Q16 % Change Service charges on deposit accounts $20,653 $20,255 $19,952 (1.5%) (3.4%) Fiduciary and asset management fees 11,903 12,615 13,195 4.6 10.9 Brokerage revenue 7,009 7,511 7,758 3.3 10.7 Mortgage banking income 5,504 5,603 5,645 0.7 2.6 Bankcard fees 8,330 7,901 7,893 (0.1) (5.3) Other fee income 4,965 5,094 4,042 (20.7) (18.6) Other non-interest income 10,256 9,439 10,767 14.1 5.0 Adjusted non-interest income* $68,620 $68,418 $69,252 1.2 0.9 Cabela’s transaction fee - 75,000 - nm nm Investment securities gains (losses), net 5,885 (7,956) - nm nm Increase (decrease) in fair value of private equity investments, net (499) (27) 100 nm nm Total non-interest income $74,006 $135,435 $69,352 (48.8%) (6.3%) *Non-GAAP financial measure; see applicable reconciliation nm = not meaningful


Slide 22

Portfolio Distribution by Type * Total loans are net of unearned deferred fees and costs, which are not displayed on this table. (dollars in millions) 4Q16 1Q17 2Q17 3Q17 4Q17 Investment Properties $5,869 24.5% $6,016 24.7% $6,036 24.6% $5,925 24.2% $5,670 22.8% Residential Properties 889 3.7 861 3.6 836 3.4 795 3.2 782 3.1 Land Acquisition 616 2.6 582 2.3 543 2.2 507 2.1 484 2.0 Total CRE $7,374 30.8% $7,459 30.6% $7,414 30.3% $7,227 29.5% $6,935 27.9% C&I 11,544 48.4 11,741 48.4 11,751 48.1 11,727 47.8 12,024 48.5 Consumer 4,964 20.8 5,084 21.0 5,291 21.7 5,558 22.7 5,854 23.6 Total Loans* $23,856 100.0% $24,258 100.0% $24,431 100.0% $24,487 100.0% $24,788 100.0%


Slide 23

Investment Properties *Annualized Investment Properties 4Q17 Credit Metrics: Credit Indicator Inv. Prop. Total NPL Ratio 0.07% Net Charge-off Ratio* 0.00% 30+ Days Past Due Ratio 0.05% 90+ Days Past Due Ratio 0.00% Investment Properties portfolio represents 82% of total CRE portfolio The portfolio is well diversified among the property types Credit quality in Investment Properties portfolio remains excellent


Slide 24

Residential C&D and Land Acquisition * Annualized Category $ Balance % of Total NPL % 30+ Days Past Due *Net Recoveries Ratio 1-4 Family Construction 198.2 32.7 0.00 0.00 (0.07) Residential Development 110.8 18.3 2.85 0.11 (0.16) Land Acquisition 296.9 49.0 0.83 0.52 (0.39) Continued reduction in this non-strategic portfolio As of 4Q17, Residential C&D and Land Acquisition Portfolios represent only 2.5% of total performing loans


Slide 25

C&I Portfolio * Annualized Credit Indicator 4Q17 NPL Ratio 0.64% Net Charge-off Ratio 0.21% 30+ Days Past Due Ratio 0.16% 90+ Days Past Due Ratio 0.01% Large Corporate/Middle Market/Specialty Lines represent 37% of C&I Balances Community/Retail Bank represents 63% of C&I balances *


Slide 26

Consumer Portfolio * Annualized Credit Indicator 4Q17 NPL Ratio 0.45% Net Charge-off Ratio 0.25% 30+ Days Past Due Ratio 0.42% 90+ Days Past Due Ratio 0.04% Credit Card Portfolio continues to perform well Average utilization rate is 21.3% Average credit score is 731 Charge-offs below industry average at 2.17% for the year Total Consumer Portfolio $5.85 billion Lending Partnerships with GreenSky and SoFi Currently $1.1 billion in balances, or 4.6% of total portfolio GreenSky is a point-of-sale program where the customer applies with home improvement store, contractor, or other merchant SoFi portfolio primarily consists of refinanced student loan debt Credit Indicator Heloc Mortgage Weighted Average Credit Score of 4Q17 Originations 785 781 Weighted average credit score of total portfolio 783 772 Average LTV 75.2% 75.4% Average DTI 32.3% 30.8% Utilization Rate 55.6% N/A Mortgage and HELOC, the two largest concentrations, have strong credit indicators *


Slide 27

Portfolio Risk Distribution Risk Category 4Q16 3Q17 4Q17 4Q17 vs. 3Q17 Change 4Q17 vs. 4Q16 Change Passing Grades $23,122 $23,888 $24,196 $308 $1,074 Special Mention 325 276 284 8 (41) Substandard Accruing 257 225 191 (34) (66) Non-Performing Loans 153 98 116 18 (37) Total Loans $23,856 $24,487 $24,787 $300 $930 (dollars in millions)


Slide 28

Loan Loss Reserve Coverage Trends (Excluding NPLs for which the expected loss has been charged off) (dollars in millions) 1.06 % % % % %


Slide 29

Troubled Debt Restructurings 98.6% of performing TDRs are paid current; only 0.03% of performing TDR’s are 90+ days past due 48% of performing TDRs are rated better than substandard Most TDR designations are due to interest rate concessions 80% of performing TDRs are not residential or land-related Accruing TDR Trends Loan Type 23% reduction from 4Q16 Risk Categories Composition of December 2017 Performing TDRs (dollars in millions)


Slide 30

Effective cost of funds calculation (dollars in thousands) 4Q16 3Q17 4Q17 Total interest expense $31,004 $35,080 $37,221 Total interest expense, annualized 123,342 139,176 147,670 Total average interest earning assets $28,304,314 $28,816,967 $29,460,006 Effective cost of funds (total interest expense, annualized, divided by total average interest earning assets) 0.44% 0.48% 0.50%


Slide 31

Non-GAAP Financial Measures (dollars in thousands) 4Q17 3Q17 4Q16 Net income available to common shareholders $27,046 95,448 65,990 Add: Earnout liability adjustments 1,700 2,059 - Add: Tax reform impact 47,181 - - Add: Merger-related expense - 23 1,086 Add: Fair value adjustment to VISA derivative - - 4,716 Add/subtract: Litigation contingency/recovery 300 401 - Subtract/add: Restructuring charges (29) 519 42 Add: Amortization of intangibles 292 292 400 Add: Loss on early extinguishment of debt, net 23,160 - - Add: 3Q17 provision expense on loans transferred to held-for-sale - 27,710 - Add: 3Q17 discounts to fair value for completed or planned ORE accelerated dispositions - 7,082 - Add: 3Q17 asset impairment charges related to accelerated disposition of corporate real estate and other properties - 1,168 - Add/subtract: Investment securities losses (gains), net - 7,956 (5,885) Subtract/add: (Increase)/decrease in fair value of private equity investments, net (100) 27 499 Subtract: Cabela’s transaction fee - (75,000) - Subtract: pre-2017 R&D credits and state taxes (4,847) - - Add/subtract: Tax effects of adjustments (8,740) 11,034 (318) Adjusted net income $85,963 78,719 66,530 Weighted average common shares outstanding-diluted 120,182 121,814 123,187 Adjusted diluted earnings per share $0.72 $0.65 $0.54


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Non-GAAP Financial Measures (dollars in thousands) 4Q17 3Q17 2Q17 1Q17 4Q16 Net income $29,605 98,007 76,003 71,858 68,549 Add: Earnout liability adjustments 1,700 2,059 - - - Add: Income tax expense related to effects of Federal Tax Reform 47,181 - - - - Add: Merger-related expense - 23 - 86 1,086 Add: Fair value adjustment to VISA derivative - - - - 4,716 Add/subtract: Litigation contingency/recovery 300 401 - - - Subtract/add: Restructuring charges (29) 519 13 6,511 42 Add: Amortization of intangibles 292 292 292 184 400 Add: Loss on early extinguishment of debt, net 23,160 - - - - Add: 3Q17 provision expense on loans transferred to held-for-sale - 27,710 - - - Add: 3Q17 discounts to fair value for completed or planned ORE accelerated dispositions - 7,082 - - - Add: 3Q17 asset impairment charges related to accelerated disposition of corporate real estate and other properties - 1,168 - - - Add/subtract: Investment securities losses (gains), net - 7,956 1 (7,668) (5,885) Subtract/add: Increase/decrease in fair value of private equity investments, net (100) 27 1,352 1,814 499 Subtract: Cabela’s transaction fee - (75,000) - - - Subtract: Income tax benefit related to pre-2017 R&D credits and state taxes (4,847) - - - - Add/subtract: Tax effects of adjustments (8,740) 11,034 (613) (343) (318) Adjusted net income $88,522 81,278 77,048 72,442 69,089 Net income annualized $351,201 322,462 309,039 293,791 274,854 Total average assets $31,388,724 30,678,388 30,630,748 30,442,089 30,207,257 Adjusted return on average assets 1.12% 1.05% 1.01% 0.97% 0.91%


Slide 33

Non-GAAP Financial Measures, continued (dollars in thousands) 4Q17 3Q17 4Q16 Net income available to common shareholders $27,046 $95,448 65.990 Add: Earnout liability adjustments 1,700 2,059 - Add: Income tax expense related to effects of Federal Tax Reform 47,181 - - Add: Merger-related expense - 23 1,086 Add: Fair value adjustment to VISA derivative - - 4,716 Add: Litigation contingency/recovery 300 401 - Subtract/add: Restructuring charges (29) 519 42 Add: Amortization of intangibles 292 292 400 Add: Loss on early extinguishment of debt, net 23,160 - - Add: 3Q17 Provision expense on loans transferred to held-for-sale - 27,710 - Add: 3Q17 discounts to fair value for completed or planned ORE accelerated disposition of corporate real estate and other properties - 7,082 - Add: 3Q17 asset impairment charges related to accelerated disposition of corporate real estate and other properties - 1,168 - Add/subtract: Investment securities losses (gains), net - 7,956 (5,885) Subtract/add: Decrease/increase in fair value of private equity investments, net (100) 27 499 Subtract: Cabela’s transaction fee - (75,000) - Subtract: Income tax benefit related to pre-2017 R&D credits and state taxes (4,847) - - Add/subtract: Tax effects of adjustments (8,740) 11,034 (318) Adjusted net income $85,963 78,719 66,530 Net income annualized $341,049 312,309 264,674 Total average shareholder’s equity less preferred stock $2,851,523 2,859,491 2,786,707 Subtract: Goodwill (57,315) (57,167) (55,144) Subtract: Other intangible assets, net (11,353) (11,648) (233) Total average tangible shareholder’s equity less preferred stock $2,782,855 2,790,676 2,731,330 Adjusted return on average common equity 11.96% 10.92 9.50 Adjusted return on average tangible common equity 12.26% 11.19 9.69


Slide 34

Non-GAAP Financial Measures, continued (dollars in thousands) Sequential quarter average loan growth excluding transfers to held for sale 4Q17 average loans, as reported $24,611,646 3Q17 average loans, as reported $24,499,923 4Q17 sequential quarter average loan growth, as reported $111,723 Sequential quarter % change, as reported, annualized 1.8% 3Q17 average loans, as reported $24,499,923 Deduct: 3Q17 transfers to held for sale (77,774) 3Q17 average loans, excluding transfers to held for sale $24,422,149 4Q17 sequential quarter average loan growth, excluding transfers to held for sale $189,497 Sequential quarter % change, as reported, annualized 3.1%


Slide 35

Non-GAAP Financial Measures, continued (dollars in thousands) 4Q16 3Q17 4Q17 Total interest expense $31,004 $35,080 $37,221 Total interest expense, annualized 123,342 139,176 147,670 Total average interest bearing liabilities 19,791,377 20,158,170 20,563,212 Cost of funds rate 0.62% 0.69% 0.72% Total interest expense $31,004 $35,080 $37,221 Subtract: Interest on long-term debt (14,823) (14,240) (11,698) Subtract: Interest on brokered deposits (2,176) (3,872) (7,886) Subtract: Interest on federal funds purchased and securities sold under repurchase agreements (47) (42) (73) Interest expense on interest bearing core deposits 13,958 16,926 17,565 Interest expense on interest bearing core deposits, annualized 55,529 67,152 69,687 Total average interest bearing liabilities 19,791,377 20,158,170 20,563,212 Subtract: Average long-term debt (2,190,716) (1,985,175) (1,713,982) Subtract: Average brokered deposits (1,380,931) (1,530,889) (2,198,333) Subtract: Average federal funds purchased and securities sold under repurchase agreements (219,429) (191,585) (184,369) Total average interest bearing core deposits 16,000,301 $16,450,521 16,466,528 Cost of interest bearing core deposits 0.35% 0.41% 0.42%


Slide 36

Non-GAAP Financial Measures, continued (dollars in thousands) 4Q16 3Q17 4Q17 Total non-interest expense $193,209 205,646 226,534 Subtract: Discounts to fair value – ORE dispositions - (7,082) - Subtract: Asset impairment charges - (1,168) - Subtract: Earnout liability adjustments - (2,059) (1,700) Subtract: Restructuring charges (42) (519) 29 Subtract: Loss on early extinguishment of debt, net - - (23,160) Subtract: Fair value adjustment to Visa derivative (4,716) - - Subtract: Litigation contingency/expense - (401) (300) Subtract: Merger-related expense (1,086) (23) - Subtract: Amortization of intangibles (400) (292) (292) Adjusted non-interest expense $186,965 194,102 201,111 Adjusted non-interest expense $186,965 194,102 201,111 Net interest income 233,530 262,572 269,713 Add: Tax equivalent adjustment 322 283 234 Add: Total non-interest income 74,006 135,435 69,352 Subtract: Cabela’s transaction fee - (75,000) - Add/subtract: Decrease/increase in fair value of private equity investments, net 499 27 (100) Subtract/add: Investment securities (gains) losses, net (5,885) 7,956 - Total adjusted revenues $302,472 $331,273 $339,199 Adjusted efficiency ratio 61.81% 58.59% 59.29% Total non-interest income $74,006 135,435 69,352 Subtract: Cabela’s transaction fee - (75,000) - Subtract/add: Investment securities (gains) losses, net (5,885) 7,956 - Add: Decrease in fair value of private equity investments, net 499 27 (100) Adjusted non-interest income $68,620 $68,418 $69,252


Slide 37

Non-GAAP Financial Measures, continued (dollars in thousands) Dec 2014 YTD Dec 2017 YTD Reported non-interest expense $744,998 $821,313 Adjusted non-interest expense 711,576 777,260 Net interest income $819,284 $1,023,309 Add: Tax equivalent adjustment 1,678 1,124 Add: Total non-interest income 262,104 345,327 Subtract: Cabela’s transaction fee - (75,000) Subtract: Gain on sale of Memphis branches, net (5,789) - Subtract: Gain from branch property sale (3,100) - Add: Decrease in fair value of private equity investments, net 378 3,093 Add/subtract: Investment securities (losses) gains, net (1,331) 289 Total adjusted revenues $1,073,224 $1,298,142 Efficiency ratio 68.87% 59.95% Adjusted efficiency ratio 66.30% 59.87% (dollars in thousands) Dec 2014 YTD Dec 2016 YTD Dec 2017 YTD Total non-interest expense $744,998 $755,923 $821,313 Subtract: 3Q17 discounts to fair value for completed or planned ORE accelerated dispositions - - (7,082) Subtract: 3Q17 asset impairment charges related to accelerated disposition of corporate real estate and other properties - - (1,168) Subtract: Earnout liability adjustments - - (3,759) Add/subtract: Restructuring charges, net (20,585) (8,267) (7,014) Subtract: Loss on ear extinguishment of debt, net - (4,735) (23,160) Subtract: Fair value adjustment to Visa derivative (3,041) (5,795) - Add: Insurance recovery of incurred legal fees related to litigation, net 3,620 - - Subtract: Litigation settlement/contingency expense (12,812) (2,511) (701) Subtract: Merger related expense - (1,636) (110) Subtract: Amortization of intangibles (604) (521) (1,059) Adjusted non-interest expense $711,576 $732,458 $777,260


Slide 38

Non-GAAP Financial Measures, continued (dollars in thousands) Dec 2014 YTD Dec 2016 YTD Dec 2017 YTD Net income available to common shareholders $185,011 $236,546 $265,236 Add: Earnout liability adjustments - - 3,759 Add: Income tax expense related to effects of Federal Tax Reform - - 47,181 Add: Income tax benefit related to pre-2017 R&D credits and state taxes - - (4,847) Add: Merger-related expense - 1,636 110 Subtract: Gain on sale of Memphis branches, net (5,789) - - Subtract: Gain from branch property sale (3,100) - - Add: Fair value adjustment to VISA derivative 3,041 5,795 - Subtract: Insurance recovery of incurred legal fees related to litigation, net (3,620) - - Add/subtract: Litigation contingency/recovery 12,812 2,511 701 Add: Loss on extinguishment of debt - 4,735 23,160 Add: Restructuring charges 20,585 8,267 7,014 Add/subtract: Investment securities (losses) gains, net (1,331) (6,011) 289 Add: Increase in fair value of private equity investments, net 378 1,026 3,093 Subtract: Cabela’s transaction fee - - (75,000) Add: 3Q17 Provision expense on loans transferred to held-for-sale - - 27,710 Add: 3Q17 discounts to fair value for completed or planned ORE accelerated dispositions - - 7,082 Add: 3Q17 asset impairment charges related to accelerated disposition of corporate real estate and other properties - - 1,168 Add: Amortization of intangibles 603 521 1,059 Add/subtract: Tax effects of adjustments (8,724) (6,838) 1,337 Adjusted net income $199,866 $248,188 $309,052 Diluted shares outstanding 139,154 125,078 122,012 Adjusted Diluted EPS $1.44 $1.98 $2.53


Slide 39

Non-GAAP Financial Measures, continued (dollars in thousands) Dec 2014 YTD Dec 2016 YTD Dec 2017 YTD Net income $195,249 $246,784 $275,474 Add: Earnout liability adjustments - - 3,759 Add: Income tax expense related to effects of Federal Tax Reform - - 47,181 Add: Income tax benefit related to pre-2017 R&D credits and state taxes - - (4,847) Add: Merger-related expense - 1,636 110 Subtract: Gain on sale of Memphis branches, net (5,789) - - Subtract: Gain from branch property sale (3,100) - - Add: Fair value adjustment to VISA derivative 3,041 5,795 - Subtract: Insurance recovery of incurred legal fees related to litigation, net (3,620) - - Add/subtract: Litigation contingency/recovery 12,812 2,511 701 Add: Loss on extinguishment of debt - 4,735 23,160 Add: Restructuring charges 20,585 8,267 7,014 Add/subtract: Investment securities (losses) gains, net (1,331) (6,011) 289 Add: Increase in fair value of private equity investments, net 378 1,026 3,093 Subtract: Cabela’s transaction fee - - (75,000) Add: 3Q17 Provision expense on loans transferred to held-for-sale - - 27,710 Add: 3Q17 discounts to fair value for completed or planned ORE accelerated dispositions - - 7,082 Add: 3Q17 asset impairment charges related to accelerated disposition of corporate real estate and other properties - - 1,168 Add: Amortization of intangibles 603 521 1,059 Add/subtract: Tax effects of adjustments (8,724) (6,838) 1,337 Adjusted net income $210,104 $258,426 $319,290 Average total assets 26,530,139 29,480,972 30,787,289 Adjusted Return on Average Assets 0.79% 0.88% 1.04%


Slide 40

Non-GAAP Financial Measures, continued (dollars in thousands) Dec 2014 YTD Dec 2016 YTD Dec 2017 YTD Net income $185,011 $236,546 $265,236 Add: Earnout liability adjustments - - 3,759 Add: Income tax expense related to effects of Federal Tax Reform - - 47,181 Add: Income tax benefit related to pre-2017 R&D credits and state taxes - - (4,847) Add: Merger-related expense - 1,636 110 Subtract: Gain on sale of Memphis branches, net (5,789) - - Subtract: Gain from branch property sale (3,100) - - Add: Fair value adjustment to VISA derivative 3,041 5,795 - Subtract: Insurance recovery of incurred legal fees related to litigation, net (3,620) - - Add/subtract: Litigation contingency/recovery 12,812 2,511 701 Add: Loss on extinguishment of debt - 4,735 23,160 Add: Restructuring charges 20,585 8,267 7,014 Add/subtract: Investment securities (losses) gains, net (1,331) (6,011) 289 Add: Increase in fair value of private equity investments, net 378 1,026 3,093 Subtract: Cabela’s transaction fee - - (75,000) Add: 3Q17 Provision expense on loans transferred to held-for-sale - - 27,710 Add: 3Q17 discounts to fair value for completed or planned ORE accelerated dispositions - - 7,082 Add: 3Q17 asset impairment charges related to accelerated disposition of corporate real estate and other properties - - 1,168 Add: Amortization of intangibles 603 521 1,059 Add/subtract: Tax effects of adjustments (8,724) (6,838) 1,337 Adjusted net income $199,866 $248,188 $309,052 Total average shareholders’ equity less preferred stock $2,899,401 $2,813,526 $2,844,570 Less: Goodwill (24,431) (32,151) (57,779) Less: Other intangible assets, net (1,742) (269) (12,030) Total average tangible shareholders’ equity less preferred stock $2,873,228 $2,781,106 $2,774,761 Adjusted return on average common equity 6.89% 8.82% 10.86% Adjusted ROATCE 6.96% 8.92% 11.14%


Slide 41

Non-GAAP Financial Measures, continued (dollars in thousands) 2017 $ % Total non-interest income, as reported $345,327 $285 million - $290 million (16%) – (18%) Subtract: Cabela’s transaction fee (75,000) Add: Investment securities losses, net 289 Add: Decrease in fair value of private equity investments 3,093 Adjusted non-interest income $273,709 $285 million - $290 million 4% - 6% Current Outlook – Increase (decrease) vs. 2017


Slide 42

Non-GAAP Financial Measures, continued (dollars in thousands) 4Q16 3Q17 4Q17 Total average deposits $24,661,265 $25,286,919 $26,286,009 Subtract: Average brokered deposits (1,380,931) (1,530,889) (2,198,333) Average core deposits $23,280,334 $23,756,030 $24,087,676 Subtract: Average time deposits excluding average SCM time deposits (3,147,620) (3,160,915) (3,084,272) Subtract: Average state, county, and municipal (SCM) deposits (2,356,567) (1,991,954) (2,211,686) Average core transaction deposits $17,776,147 $18,603,161 $18,791,718 (dollars in thousands) 4Q16 1Q17 2Q17 3Q17 4Q17 Total assets $30,104,002 $30,679,589 $30,687,966 $31,642,123 $31,221,837 Subtract: Goodwill (59,678) (57,010) (57,092) (57,315) (57,315) Subtract: Other intangible assets, net (13,223) (12,137) (11,843) (11,548) (11,254) Tangible assets $30,031,101 $30,610,442 $30,619,031 $31,573,260 $31,153,268 Total shareholders’ equity $2,927,924 $2,962,127 $2,997,947 $2,997,078 2,961,566 Subtract: Goodwill (59,678) (57,010) (57,092) (57,315) (57,315) Subtract: Other intangible assets, net (13,223) (12,137) (11,843) (11,548) (11,254) Subtract: Series C Preferred Sock (125,980) (125,980) (125,980) (125,980) (125,980) Tangible common equity $2,729,043 $2,767,000 $2,803,032 $2,802,235 $2,767,017 Total shareholders’ equity to total assets ratio 9.73% 9.66% 9.77% 9.47% 9.49% Tangible Common Equity ratio 9.09% 9.04% 9.15% 8.88% 8.88% (dollars in thousands) 4Q17 Common equity Tier 1 (CET1) $2,763,170 Adjustment related to capital components (17,147) Common equity Tier 1 (fully phased-in) $2,746,023 Total risk-weighted assets $27,672,344 Total risk-weighted assets (fully phased-in) $27,787,437 Common equity Tier 1 (CET1) ratio 9.99% Common equity Tier 1 (CET1) ratio (fully phased-in) 9.88%

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