Fourth quarter 2016 net earnings of $0.31 per share and full-year 2016 of $1.05 per share Operating earnings1 of $0.27 per share for fourth quarter 2016 and $1.19 per share for full-year 2016
PORTLAND, Ore., Jan. 25, 2017 (GLOBE NEWSWIRE) -- Umpqua Holdings Corporation (NASDAQ:UMPQ) (the “Company”) reported net earnings available to common shareholders of $69.2 million for the fourth quarter of 2016, up from $61.8 million for the third quarter of 2016 and $62.9 million for the fourth quarter of 2015. Earnings per diluted common share were $0.31 for the fourth quarter of 2016, up from $0.28 for the third quarter of 2016 and $0.28 for the fourth quarter of 2015.
For the twelve months ended December 31, 2016, the Company reported net earnings available to common shareholders of $232.8 million, or $1.05 per diluted common share, up from $222.2 million, or $1.01 per diluted common share, for the twelve months ended December 31, 2015.
“We continued to build positive momentum during 2016; restructuring the balance sheet, entering new markets, expanding our product offerings, and enhancing the digital customer experience, while streamlining operations and demonstrating expense discipline,” said Cort O'Haver, president and CEO of Umpqua Holdings Corporation. “With all of the heavy lifting we completed over the past two years, I believe there is now a tremendous opportunity in front of us. Given Umpqua's unique franchise and strong brand recognition, combined with the size of the balance sheet and attractive footprint, I feel we are well-positioned to capitalize on that opportunity. I look forward to sharing more details over the coming year.”
Reconciliation of Net Earnings (GAAP) to Operating Earnings (non-GAAP):
The Company’s financial results include several significant items which have been excluded in the presentation of operating earnings, which is a non-GAAP financial measure. A summary of these items, and a reconciliation of earnings available to common shareholders (GAAP) to operating earnings (non-GAAP), is presented below. More information is provided in the non-GAAP financial measures section of this release, which we urge you to read.
| Quarter Ended | ||||||||||||||||||||
| (In thousands, except per share data) | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | |||||||||||||||
| Net earnings available to common shareholders | $ | 69,242 | $ | 61,778 | $ | 54,255 | $ | 47,540 | $ | 62,923 | ||||||||||
| Adjustments: | ||||||||||||||||||||
| (Gain) loss from change in fair value of MSR asset | (16,465 | ) | 7,826 | 13,940 | 20,625 | 469 | ||||||||||||||
| Gain on investment securities, net | — | — | (162 | ) | (696 | ) | (2,567 | ) | ||||||||||||
| Net loss on junior subordinated debentures carried at fair value | 1,589 | 1,590 | 1,572 | 1,572 | 1,589 | |||||||||||||||
| (Gain) loss from change in fair value of swap derivatives | (4,601 | ) | (182 | ) | 1,493 | 1,793 | (715 | ) | ||||||||||||
| Merger related expenses | 3,218 | 2,011 | 6,634 | 3,450 | 3,712 | |||||||||||||||
| Goodwill impairment | — | — | — | 142 | — | |||||||||||||||
| Exit or disposal costs | 1,207 | 1,728 | 1,434 | 347 | — | |||||||||||||||
| Total pre-tax adjustments | (15,052 | ) | 12,973 | 24,911 | 27,233 | 2,488 | ||||||||||||||
| Income tax effect (1) | 6,020 | (5,188 | ) | (9,965 | ) | (10,836 | ) | (995 | ) | |||||||||||
| Net adjustments | (9,032 | ) | 7,785 | 14,946 | 16,397 | 1,493 | ||||||||||||||
| Operating earnings | $ | 60,210 | $ | 69,563 | $ | 69,201 | $ | 63,937 | $ | 64,416 | ||||||||||
| Earnings per diluted share: | ||||||||||||||||||||
| Earnings available to common shareholders | $ | 0.31 | $ | 0.28 | $ | 0.25 | $ | 0.22 | $ | 0.28 | ||||||||||
| Operating earnings | $ | 0.27 | $ | 0.32 | $ | 0.31 | $ | 0.29 | $ | 0.29 | ||||||||||
| (1) Income tax effect of operating earnings adjustments at 40% for tax-deductible items. | ||||||||||||||||||||
Full-Year 2016 Highlights (comparisons are to prior year):
- Total revenue of $1.1 billion, unchanged from prior year as increased mortgage banking revenues were offset by lower average yields on interest-earning assets, along with a lower level of interest income arising from the accretion of the credit discount recorded on acquired loans;
- Total non-interest expense decreased by 3%, reflecting lower merger-related expenses and lower salaries and benefits expense, partially offset by higher mortgage banking expenses due to the increase in mortgage originations;
- Gross loan and lease growth of $642 million, or 4% (excluding the impact of loan sales, loan growth of $1.3 billion, or 8%);
- Deposit growth of $1.3 billion, or 7%; and
- Paid dividends of $0.64 per common share, repurchased 635,000 shares of stock, and grew tangible book value1 by 4%, or $0.34 per share.
Fourth Quarter 2016 Highlights (comparisons are to prior quarter):
- Total revenue increased by $15.8 million:
- Net interest income decreased by $2.1 million, reflecting lower accretion of the credit discount recorded on acquired loans, lower prepayment fee income and higher premium amortization on investment securities, partially offset by growth in in interest-earning assets;
- Non-interest income increased by $17.9 million, driven primarily by gains related to fair value changes of the mortgage servicing rights ("MSR") asset and debt capital market swap derivatives, partially offset by lower revenues from the origination and sale of mortgages due to a decrease in the home lending gain on sale margin; - Non-interest expense increased by $2.3 million due primarily to higher merger-related and other expense;
- Gross loans and leases grew to $17.5 billion;
- Deposits grew to $19.0 billion;
- Stable asset quality, with non-performing assets to total assets of 0.25%;
- Estimated total risk-based capital ratio of 14.6% and estimated Tier 1 common to risk weighted assets ratio of 11.4%;
- Declared quarterly cash dividend of $0.16 per common share; and
- Repurchased 75,000 shares of common stock for $1.3 million.
Balance Sheet
Total consolidated assets increased to $24.8 billion as of December 31, 2016, compared to $24.7 billion as of September 30, 2016 and $23.4 billion as of December 31, 2015. Including secured off-balance sheet lines of credit, the Company had total available liquidity of $9.2 billion as of December 31, 2016, representing 37% of total assets and 49% of total deposits.
Gross loans and leases were up 1% from the prior quarter to $17.5 billion as of December 31, 2016, driven by growth in the commercial and commercial real estate portfolios, partially offset by a decline in multi-family loans. During the fourth quarter of 2016, the Company sold $26.9 million of leasing and equipment finance loans.
Total deposits increased 1% from the prior quarter to $19.0 billion as of December 31, 2016. This increase was primarily attributable to growth in interest bearing demand and money market accounts, partially offset by lower non-interest bearing demand deposits.
Net Interest Income
Net interest income was $207.8 million for the fourth quarter of 2016, down $2.1 million from the prior quarter. This decrease was primarily attributable to a $1.4 million linked quarter decrease in interest income arising from the accretion of the credit discount recorded on acquired loans, as well as lower prepayment fee income and lower average yields on loans and leases and taxable investments. These items were partially offset by growth in average interest-earning assets.
The Company’s net interest margin was 3.83% for the fourth quarter of 2016, down from 3.95% for the third quarter of 2016. The linked quarter decrease reflects the lower level of accretion of the credit discount recorded on acquired loans, as well as lower average yields on taxable investments and loans and leases. The lower average yield on taxable investments was primarily attributable to $1.1 million increase in premium amortization from faster prepayment speeds on the Company's agency mortgage-backed securities portfolio. This trend occurred prior to the increase in long-term mortgage interest rates late in the quarter.
Credit Quality
Under acquisition accounting, loans (including those considered non-performing) acquired from Sterling were recorded at their estimated fair value, and the related allowance for loan losses was eliminated. As a result, the Company wrote down the value of the loan and lease portfolio acquired from Sterling as of the acquisition date. The credit portion of the fair value mark is not reflected in the reported allowance for loan and lease losses, or its related allowance coverage ratios, but we believe should be considered when comparing the current quarter ratios to similar ratios in periods prior to the acquisition of Sterling.
Loans acquired with significantly deteriorated credit quality are accounted for as purchased credit impaired pools. Accordingly, loans included in the purchased credit impaired pools are not reported as non-performing loans based upon their individual performance status.
During the fourth quarter of 2016, the Company reported $7.7 million of accretion related to the Sterling credit discount in interest income, as compared to $9.1 million in the prior quarter. As of December 31, 2016, the purchased non-credit impaired loans had approximately $43.9 million of remaining credit discount that will accrete into interest income over the life of the loans, and the purchased credit impaired loan pools had approximately $32.2 million of remaining total discount.
The allowance for loan and lease losses was $134.0 million, or 0.77% of loans and leases, as of December 31, 2016. To provide better comparability to prior periods, this pro-forma ratio would have been approximately 1.2% after grossing up the allowance for loan and lease losses and the loans and leases by the amount of the credit discount remaining as of quarter-end. This compares to a pro-forma ratio of approximately 1.3% as of September 30, 2016.
The provision for loan and lease losses increased slightly from the prior quarter to $13.2 million, driven primarily by higher net charge-offs, which increased to $12.9 million for the fourth quarter of 2016, compared to $10.4 million for the third quarter of 2016. As of December 31, 2016, non-performing assets represented 0.25% of total assets, unchanged from September 30, 2016 and down from 0.28% as of December 31, 2015.
Non-interest Income
Non-interest income was $98.6 million for the fourth quarter of 2016, up $17.9 million from the prior quarter. This increase reflects income of $16.5 million and $4.6 million related to the fair value change of the MSR asset and the debt capital market swap derivatives, respectively, both attributable to the increase in long-term interest rates late in the quarter. This compares to a loss of $7.8 million on the MSR asset, and a gain of $0.2 million on the debt capital markets swap derivative, for the third quarter of 2016.
Excluding the impacts of the changes in fair value on the MSR asset and debt capital markets swap derivative, non-interest income decreased by $10.8 million from the prior quarter, driven primarily by lower revenue from the origination and sale of residential mortgages. This decrease was driven by a lower home lending gain on sale margin, which decreased to 3.05%, compared to 4.08% in the prior quarter, along with a 5% linked quarter decrease in for sale mortgage originations. The decrease in home lending gain on sale margin was attributable to the dramatic increase in mortgage rates and a decline in the overall locked loan pipeline. Of the current quarter’s mortgage production, 63% related to purchase activity, as compared to 68% for the prior quarter and 63% for the same period in the prior year.
Revenue related to the servicing of residential mortgage loans increased by 2% from the prior quarter, reflecting growth in the residential mortgage loans serviced for others portfolio.
Non-interest Expense
Non-interest expense was $183.5 million for the fourth quarter of 2016, which included $3.2 million of merger-related expenses and $1.2 million of exit or disposal costs. This compares to $181.2 million, including $2.0 million of merger-related expenses and $1.7 million of exit or disposal costs for the third quarter of 2016.
Excluding the impact of merger-related and exit or disposal costs, non-interest expense increased by $1.6 million from the prior quarter. The linked quarter increase was driven primarily by higher expenses across several categories, including employee group insurance and benefits, severance, technology and marketing expense, as well as lower cost deferrals. This was partially offset by a $2.9 million linked quarter decline in mortgage banking expenses, consistent with the lower level of mortgage origination volume in the quarter.
Capital
As of December 31, 2016, the Company’s tangible book value per common share1 decreased slightly to $9.50. During the fourth quarter of 2016, the Company repurchased 75,000 shares of common stock for $1.3 million. For the twelve months ended 2016, the Company repurchased 635,000 shares for $9.8 million.
The Company’s estimated total risk-based capital ratio was 14.6% and its estimated Tier 1 common to risk weighted assets ratio was 11.4% as of December 31, 2016. The Company remains above current “well-capitalized” regulatory minimums. The regulatory capital ratios as of December 31, 2016 are estimates, pending completion and filing of the Company’s regulatory reports.
Non-GAAP Financial Measures
In addition to results presented in accordance with generally accepted accounting principles in the United States of America (GAAP), this press release contains certain non-GAAP financial measures. The Company believes that certain non-GAAP financial measures provide investors with information useful in understanding the Company’s financial performance; however, readers of this document are urged to review these non-GAAP financial measures in conjunction with the GAAP results as reported.
The Company incurs significant expenses related to the completion and integration of mergers and acquisitions. It also recognizes gains or losses on its junior subordinated debentures carried at fair value resulting from changes in interest rates and the estimated market credit risk adjusted spread that do not directly correlate with the Company’s operating performance. Additionally, it may recognize goodwill impairment losses that have no direct effect on the Company’s or the Bank’s cash balances, liquidity, or regulatory capital ratios. The Company recognizes gains and losses related to the change in the fair value of its MSR, which are primarily tied to movements in interest rates, and are not indicative of the fundamental operating activities for the period. It also recognizes gains or losses related to the change in the fair value of its swap derivatives, which are driven by movements in interest rates and are beyond our control. On occasion, the Company may sell certain securities in its investment portfolio, and recognize an associated gain or loss, which can be highly discretionary based on the timing of the sales, market opportunities, and interest rates, and therefore are not reflective of the Company's operating performance. The Company also may incur expenses related to the exit or disposal of certain business activities, such as the consolidation of bank branches, which do not reflect the on-going operating performance of the Company. Lastly, the Company may recognize one-time bargain purchase gains on certain acquisitions that are not reflective of the Company’s on-going earnings power.
Accordingly, management believes that our operating results are best measured on a comparative basis excluding the after-tax impact of merger-related expenses, gains or losses on junior subordinated debentures measured at fair value, gains or losses from the change in fair value of the MSR, gains or losses from the change in fair value of swap derivatives, net gains or losses on investment securities, exit or disposal costs and other charges related to business combinations such as goodwill impairment charges or bargain purchase gains. The Company defines operating earnings as earnings available to common shareholders before these items, and calculates operating earnings per diluted share by dividing operating earnings by the same diluted share total used in determining diluted earnings per common share.
The following table provides the reconciliation of earnings available to common shareholders (GAAP) to operating earnings (non-GAAP), and earnings per diluted common share (GAAP) to operating earnings per diluted share (non-GAAP) for the periods presented:
| Quarter Ended | % Change | |||||||||||||||||||||||||
| (Dollars in thousands, except per share data) | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Seq. Quarter | Year over Year | |||||||||||||||||||
| Net earnings available to common shareholders | $ | 69,242 | $ | 61,778 | $ | 54,255 | $ | 47,540 | $ | 62,923 | 12 | % | 10 | % | ||||||||||||
| Adjustments: | ||||||||||||||||||||||||||
| (Gain) loss from change in fair value of MSR asset | (16,465 | ) | 7,826 | 13,940 | 20,625 | 469 | (310 | )% | nm | |||||||||||||||||
| Gain on investment securities, net | — | — | (162 | ) | (696 | ) | (2,567 | ) | 0 | % | (100 | )% | ||||||||||||||
| Net loss on junior subordinated debentures carried at fair value | 1,589 | 1,590 | 1,572 | 1,572 | 1,589 | 0 | % | 0 | % | |||||||||||||||||
| (Gain) loss from change in fair value of swap derivatives | (4,601 | ) | (182 | ) | 1,493 | 1,793 | (715 | ) | nm | 543 | % | |||||||||||||||
| Merger related expenses | 3,218 | 2,011 | 6,634 | 3,450 | 3,712 | 60 | % | (13 | )% | |||||||||||||||||
| Goodwill impairment | — | — | — | 142 | — | nm | nm | |||||||||||||||||||
| Exit or disposal costs | 1,207 | 1,728 | 1,434 | 347 | — | (30 | )% | nm | ||||||||||||||||||
| Total pre-tax adjustments | (15,052 | ) | 12,973 | 24,911 | 27,233 | 2,488 | (216 | )% | (705 | )% | ||||||||||||||||
| Income tax effect(1) | 6,020 | (5,188 | ) | (9,965 | ) | (10,836 | ) | (995 | ) | (216 | )% | (705 | )% | |||||||||||||
| Net adjustments | (9,032 | ) | 7,785 | 14,946 | 16,397 | 1,493 | (216 | )% | (705 | )% | ||||||||||||||||
| Operating earnings | $ | 60,210 | $ | 69,563 | $ | 69,201 | $ | 63,937 | $ | 64,416 | (13 | )% | (7 | )% | ||||||||||||
| Earnings per diluted share: | ||||||||||||||||||||||||||
| Earnings available to common shareholders | $ | 0.31 | $ | 0.28 | $ | 0.25 | $ | 0.22 | $ | 0.28 | 11 | % | 11 | % | ||||||||||||
| Operating earnings | $ | 0.27 | $ | 0.32 | $ | 0.31 | $ | 0.29 | $ | 0.29 | (16 | )% | (7 | )% | ||||||||||||
| Year Ended | % Change | |||||||||||||||||||||||||
| Dec 31, 2016 | Dec 31, 2015 | Year over Year | ||||||||||||||||||||||||
| Net earnings available to common shareholders | $ | 232,815 | $ | 222,182 | 5 | % | ||||||||||||||||||||
| Adjustments: | ||||||||||||||||||||||||||
| Loss from change in fair value of MSR asset | 25,926 | 20,723 | 25 | % | ||||||||||||||||||||||
| Gain on investment securities, net | (858 | ) | (2,922 | ) | (71 | )% | ||||||||||||||||||||
| Net loss on junior subordinated debentures carried at fair value | 6,323 | 6,306 | 0 | % | ||||||||||||||||||||||
| Gain from change in fair value of swap derivatives | (1,497 | ) | (162 | ) | 824 | % | ||||||||||||||||||||
| Merger related expenses | 15,313 | 45,582 | (66 | )% | ||||||||||||||||||||||
| Goodwill impairment | 142 | — | nm | |||||||||||||||||||||||
| Exit or disposal costs | 4,716 | — | nm | |||||||||||||||||||||||
| Total pre-tax adjustment | 50,065 | 69,527 | (28 | )% | ||||||||||||||||||||||
| Income tax effect | (19,969 | ) | (27,811 | ) | (28 | )% | ||||||||||||||||||||
| Net adjustments | 30,096 | 41,716 | (28 | )% | ||||||||||||||||||||||
| Operating earnings | $ | 262,911 | $ | 263,898 | 0 | % | ||||||||||||||||||||
| Earnings per diluted share: | ||||||||||||||||||||||||||
| Earnings available to common shareholders | $ | 1.05 | $ | 1.01 | 4 | % | ||||||||||||||||||||
| Operating earnings | $ | 1.19 | $ | 1.19 | 0 | % | ||||||||||||||||||||
| (1) Income tax effect of operating earnings adjustments at 40% for tax-deductible items. | ||||||||||||||||||||||||||
| nm = not meaningful. | ||||||||||||||||||||||||||
The following tables provide the reconciliation of non-interest income (GAAP) to non-interest income, on an operating basis, (non-GAAP), and non-interest expense (GAAP) to non-interest expense, on an operating basis, (non-GAAP) for the periods presented:
| Quarter ended | ||||||||||||||||||||
| (Dollars in thousands) | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | |||||||||||||||
| Non-interest income (GAAP) | $ | 98,620 | $ | 80,710 | $ | 74,659 | $ | 45,951 | $ | 69,345 | ||||||||||
| Adjustments: | ||||||||||||||||||||
| (Gain) loss from change in fair value of MSR asset | (16,465 | ) | 7,826 | 13,940 | 20,625 | 469 | ||||||||||||||
| (Gain) loss from change in fair value of swap derivatives | (4,601 | ) | (182 | ) | 1,493 | 1,793 | (715 | ) | ||||||||||||
| Net loss on junior subordinated debentures carried at fair value | 1,589 | 1,590 | 1,572 | 1,572 | 1,589 | |||||||||||||||
| Gain on investment securities, net | — | — | (162 | ) | (696 | ) | (2,567 | ) | ||||||||||||
| Non-interest income (operating basis) | $ | 79,143 | $ | 89,944 | $ | 91,502 | $ | 69,245 | $ | 68,121 | ||||||||||
| Quarter ended | ||||||||||||||||||||
| Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | ||||||||||||||||
| Non-interest expense (GAAP) | $ | 183,468 | $ | 181,187 | 188,511 | $ | 183,989 | $ | 185,911 | |||||||||||
| Adjustments: | ||||||||||||||||||||
| Merger related expenses | (3,218 | ) | (2,011 | ) | (6,634 | ) | (3,450 | ) | (3,712 | ) | ||||||||||
| Goodwill impairment | — | — | — | (142 | ) | — | ||||||||||||||
| Exit or disposal costs | (1,207 | ) | (1,728 | ) | (1,434 | ) | (347 | ) | — | |||||||||||
| Non-interest expense (operating basis) | $ | 179,043 | $ | 177,448 | $ | 180,443 | $ | 180,050 | $ | 182,199 | ||||||||||
| Year Ended | ||||||||||||||||||||
| (Dollars in thousands) | Dec 31, 2016 | Dec 31, 2015 | ||||||||||||||||||
| Non-interest income (GAAP) | $ | 299,940 | $ | 275,724 | ||||||||||||||||
| Adjustments: | ||||||||||||||||||||
| Loss from change in fair value of MSR asset | 25,926 | 20,723 | ||||||||||||||||||
| Gain from change in fair value of swap derivatives | (1,497 | ) | (162 | ) | ||||||||||||||||
| Net loss on junior subordinated debentures carried at fair value | 6,323 | 6,306 | ||||||||||||||||||
| Gain on investment securities, net | (858 | ) | (2,922 | ) | ||||||||||||||||
| Non-interest income (operating basis) | $ | 329,834 | $ | 299,669 | ||||||||||||||||
| Year Ended | ||||||||||||||||||||
| Dec 31, 2016 | Dec 31, 2015 | |||||||||||||||||||
| Non-interest expense (GAAP) | $ | 737,155 | $ | 763,642 | ||||||||||||||||
| Adjustments: | ||||||||||||||||||||
| Merger related expenses | (15,313 | ) | (45,582 | ) | ||||||||||||||||
| Goodwill impairment | (142 | ) | — | |||||||||||||||||
| Exit or disposal costs | (4,716 | ) | — | |||||||||||||||||
| Non-interest expense (operating basis) | $ | 716,984 | $ | 718,060 | ||||||||||||||||
Management believes tangible common equity and the tangible common equity ratio are meaningful measures of capital adequacy because they provide a meaningful base for period-to-period and company-to-company comparisons, which management believes will assist investors in assessing the capital of the Company and the ability to absorb potential losses. Tangible common equity is calculated as total shareholders' equity less goodwill and other intangible assets, net (excluding MSRs). Tangible assets are total assets less goodwill and other intangible assets, net (excluding MSRs). The tangible common equity ratio is calculated as tangible common shareholders’ equity divided by tangible assets.
The following table provides reconciliations of ending shareholders’ equity (GAAP) to ending tangible common equity (non-GAAP), and ending assets (GAAP) to ending tangible assets (non-GAAP).
| (Dollars in thousands, except per share data) | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | |||||||||||||||
| Total shareholders' equity | $ | 3,916,795 | $ | 3,920,208 | $ | 3,902,158 | $ | 3,878,630 | $ | 3,849,334 | ||||||||||
| Subtract: | ||||||||||||||||||||
| Goodwill | 1,787,651 | 1,787,651 | 1,787,651 | 1,787,651 | 1,787,793 | |||||||||||||||
| Other intangible assets, net | 36,886 | 38,753 | 40,620 | 42,948 | 45,508 | |||||||||||||||
| Tangible common shareholders' equity | $ | 2,092,258 | $ | 2,093,804 | $ | 2,073,887 | $ | 2,048,031 | $ | 2,016,033 | ||||||||||
| Total assets | $ | 24,813,119 | $ | 24,744,214 | $ | 24,132,507 | $ | 23,935,686 | $ | 23,406,381 | ||||||||||
| Subtract: | ||||||||||||||||||||
| Goodwill | 1,787,651 | 1,787,651 | 1,787,651 | 1,787,651 | 1,787,793 | |||||||||||||||
| Other intangible assets, net | 36,886 | 38,753 | 40,620 | 42,948 | 45,508 | |||||||||||||||
| Tangible assets | $ | 22,988,582 | $ | 22,917,810 | $ | 22,304,236 | $ | 22,105,087 | $ | 21,573,080 | ||||||||||
| Common shares outstanding at period end | 220,177 | 220,207 | 220,482 | 220,171 | 220,171 | |||||||||||||||
| Common equity ratio | 15.79 | % | 15.84 | % | 16.17 | % | 16.20 | % | 16.45 | % | ||||||||||
| Tangible common equity ratio | 9.10 | % | 9.14 | % | 9.30 | % | 9.26 | % | 9.35 | % | ||||||||||
| Book value per common share | $ | 17.79 | $ | 17.80 | $ | 17.70 | $ | 17.62 | $ | 17.48 | ||||||||||
| Tangible book value per common share | $ | 9.50 | $ | 9.51 | $ | 9.41 | $ | 9.30 | $ | 9.16 | ||||||||||
About Umpqua Holdings Corporation
Umpqua Holdings Corporation (NASDAQ:UMPQ) is the parent company of Umpqua Bank, an Oregon-based community bank recognized for its entrepreneurial approach, innovative use of technology, and distinctive banking solutions. Umpqua Bank has locations across Oregon, Washington, California, Idaho and Nevada. Umpqua Holdings also owns a retail brokerage subsidiary, Umpqua Investments, Inc., which has locations in Umpqua Bank stores and in dedicated offices in Oregon and Pivotus Ventures, an innovation studio headquartered in Silicon Valley focused on creating key technologies and business models that transform finance and commerce. Umpqua Holdings Corporation is headquartered in Portland, Oregon. For more information, visit https://www.umpquabank.com/ask-us/investor-relations/.
Earnings Conference Call Information
The Company will host its fourth quarter 2016 earnings conference call on Thursday, January 26, 2017, at 10:00 a.m. PT (1:00 p.m. ET). During the call, the Company will provide an update on recent activities and discuss its fourth quarter and full-year 2016 financial results. There will be a live question-and-answer session following the presentation. To join the call, please dial (877) 718-5106 ten minutes prior to the start time and enter conference ID: 4736138. A re-broadcast will be available approximately two hours after the call by dialing (888) 203-1112 and entering conference ID 4736138. The earnings conference call will also be available as an audiocast, which can be accessed on the Company’s investor relations page at https://www.umpquabank.com/ask-us/investor-relations/. A slide presentation to accompany the call will also be posted on the website before the call.
Forward-Looking Statements
This press release and our earnings call and related slide presentation include forward-looking statements within the meaning of the “Safe-Harbor” provisions of the Private Securities Litigation Reform Act of 1995, which management believes are a benefit to shareholders. These statements are necessarily subject to risk and uncertainty and actual results could differ materially due to various risk factors, including those set forth from time to time in our filings with the SEC. You should not place undue reliance on forward-looking statements and we undertake no obligation to update any such statements. We make forward-looking statements about credit discount accretion on acquired loans and 2017 initiatives and growth opportunities. Specific risks that could cause results to differ from these forward-looking statements include our ability to successfully develop and market new products and technology. Additional risks that could cause results to differ from forward-looking statements we make are set forth in our filings with the SEC and include, without limitation, prolonged low interest rate environment; significant volatility in interest rates; unanticipated weakness in loan demand or loan pricing; lack of strategic growth opportunities or our failure to execute on those opportunities; our inability to effectively manage problem credits; unanticipated increases in the cost of deposits; changes in laws or regulations; changes in regulatory or compliance costs; and changes in general economic conditions.
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| (Unaudited) | ||||||||||||||||||||||||||
| Quarter Ended | % Change | |||||||||||||||||||||||||
| (In thousands, except per share data) | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Seq. Quarter | Year over Year | |||||||||||||||||||
| Interest income: | ||||||||||||||||||||||||||
| Loans and leases | $ | 209,812 | $ | 212,037 | $ | 210,290 | $ | 217,928 | $ | 219,440 | (1 | )% | (4 | )% | ||||||||||||
| Interest and dividends on investments: | ||||||||||||||||||||||||||
| Taxable | 10,630 | 10,779 | 11,963 | 13,055 | 12,654 | (1 | )% | (16 | )% | |||||||||||||||||
| Exempt from federal income tax | 2,229 | 2,181 | 2,183 | 2,235 | 2,363 | 2 | % | (6 | )% | |||||||||||||||||
| Dividends | 336 | 332 | 365 | 366 | 326 | 1 | % | 3 | % | |||||||||||||||||
| Temporary investments & interest bearing deposits | 1,696 | 1,090 | 652 | 480 | 422 | 56 | % | 302 | % | |||||||||||||||||
| Total interest income | 224,703 | 226,419 | 225,453 | 234,064 | 235,205 | (1 | )% | (4 | )% | |||||||||||||||||
| Interest expense: | ||||||||||||||||||||||||||
| Deposits | 9,288 | 8,999 | 8,540 | 8,413 | 7,905 | 3 | % | 17 | % | |||||||||||||||||
| Repurchase agreements | 32 | 32 | 32 | 36 | 39 | 0 | % | (18 | )% | |||||||||||||||||
| Term debt | 3,413 | 3,558 | 3,848 | 4,186 | 3,885 | (4 | )% | (12 | )% | |||||||||||||||||
| Junior subordinated debentures | 4,174 | 3,938 | 3,835 | 3,727 | 3,542 | 6 | % | 18 | % | |||||||||||||||||
| Total interest expense | 16,907 | 16,527 | 16,255 | 16,362 | 15,371 | 2 | % | 10 | % | |||||||||||||||||
| Net interest income | 207,796 | 209,892 | 209,198 | 217,702 | 219,834 | (1 | )% | (5 | )% | |||||||||||||||||
| Provision for loan and lease losses | 13,171 | 13,091 | 10,589 | 4,823 | 4,545 | 1 | % | 190 | % | |||||||||||||||||
| Non-interest income: | ||||||||||||||||||||||||||
| Service charges on deposits | 15,323 | 15,762 | 15,667 | 14,516 | 15,039 | (3 | )% | 2 | % | |||||||||||||||||
| Brokerage revenue | 4,230 | 4,129 | 4,580 | 4,094 | 4,061 | 2 | % | 4 | % | |||||||||||||||||
| Residential mortgage banking revenue, net | 58,448 | 47,206 | 36,783 | 15,426 | 32,440 | 24 | % | 80 | % | |||||||||||||||||
| Gain on investment securities, net | — | — | 162 | 696 | 2,567 | 0 | % | (100 | )% | |||||||||||||||||
| Gain on loan sales | 4,060 | 1,285 | 5,640 | 2,371 | 1,729 | 216 | % | 135 | % | |||||||||||||||||
| Loss on junior subordinated debentures carried at fair value | (1,589 | ) | (1,590 | ) | (1,572 | ) | (1,572 | ) | (1,589 | ) | 0 | % | 0 | % | ||||||||||||
| BOLI income | 2,107 | 2,116 | 2,152 | 2,139 | 1,841 | 0 | % | 14 | % | |||||||||||||||||
| Other income | 16,041 | 11,802 | 11,247 | 8,281 | 13,257 | 36 | % | 21 | % | |||||||||||||||||
| Total non-interest income | 98,620 | 80,710 | 74,659 | 45,951 | 69,345 | 22 | % | 42 | % | |||||||||||||||||
| Non-interest expense: | ||||||||||||||||||||||||||
| Salaries and employee benefits | 105,406 | 105,341 | 107,545 | 106,538 | 106,203 | 0 | % | (1 | )% | |||||||||||||||||
| Occupancy and equipment, net | 37,618 | 38,181 | 37,850 | 38,295 | 38,722 | (1 | )% | (3 | )% | |||||||||||||||||
| Intangible amortization | 1,867 | 1,867 | 2,328 | 2,560 | 2,806 | 0 | % | (33 | )% | |||||||||||||||||
| FDIC assessments | 3,985 | 4,109 | 3,693 | 3,721 | 3,742 | (3 | )% | 6 | % | |||||||||||||||||
| (Gain) loss on other real estate owned, net | (197 | ) | (14 | ) | (1,457 | ) | 1,389 | (242 | ) | 1,307 | % | (19 | )% | |||||||||||||
| Merger related expenses | 3,218 | 2,011 | 6,634 | 3,450 | 3,712 | 60 | % | (13 | )% | |||||||||||||||||
| Goodwill impairment | — | — | — | 142 | — | nm | nm | |||||||||||||||||||
| Other expense | 31,571 | 29,692 | 31,918 | 27,894 | 30,968 | 6 | % | 2 | % | |||||||||||||||||
| Total non-interest expense | 183,468 | 181,187 | 188,511 | 183,989 | 185,911 | 1 | % | (1 | )% | |||||||||||||||||
| Income before provision for income taxes | 109,777 | 96,324 | 84,757 | 74,841 | 98,723 | 14 | % | 11 | % | |||||||||||||||||
| Provision for income taxes | 40,502 | 34,515 | 30,470 | 27,272 | 35,704 | 17 | % | 13 | % | |||||||||||||||||
| Net income | 69,275 | 61,809 | 54,287 | 47,569 | 63,019 | 12 | % | 10 | % | |||||||||||||||||
| Dividends and undistributed earnings allocated to participating securities | 33 | 31 | 32 | 29 | 96 | 6 | % | (66 | )% | |||||||||||||||||
| Net earnings available to common shareholders | $ | 69,242 | $ | 61,778 | $ | 54,255 | $ | 47,540 | $ | 62,923 | 12 | % | 10 | % | ||||||||||||
| Weighted average basic shares outstanding | 220,190 | 220,291 | 220,421 | 220,227 | 220,202 | 0 | % | 0 | % | |||||||||||||||||
| Weighted average diluted shares outstanding | 220,756 | 220,751 | 220,907 | 221,052 | 220,930 | 0 | % | 0 | % | |||||||||||||||||
| Earnings per common share – basic | $ | 0.31 | $ | 0.28 | $ | 0.25 | $ | 0.22 | $ | 0.29 | 11 | % | 7 | % | ||||||||||||
| Earnings per common share – diluted | $ | 0.31 | $ | 0.28 | $ | 0.25 | $ | 0.22 | $ | 0.28 | 11 | % | 11 | % | ||||||||||||
| nm = not meaningful | ||||||||||||||||||||||||||
| Umpqua Holdings Corporation | |||||||||||
| Consolidated Statements of Income | |||||||||||
| (Unaudited) | |||||||||||
| Year Ended | % Change | ||||||||||
| (In thousands, except per share data) | Dec 31, 2016 | Dec 31, 2015 | Year over Year | ||||||||
| Interest income: | |||||||||||
| Loans and leases | $ | 850,067 | $ | 869,433 | (2 | )% | |||||
| Interest and dividends on investments: | |||||||||||
| Taxable | 46,427 | 47,842 | (3 | )% | |||||||
| Exempt from federal income tax | 8,828 | 9,647 | (8 | )% | |||||||
| Dividends | 1,399 | 708 | 98 | % | |||||||
| Temporary investments & interest bearing deposits | 3,918 | 2,236 | 75 | % | |||||||
| Total interest income | 910,639 | 929,866 | (2 | )% | |||||||
| Interest expense: | |||||||||||
| Deposits | 35,240 | 29,839 | 18 | % | |||||||
| Repurchase agreements | 132 | 173 | (24 | )% | |||||||
| Term debt | 15,005 | 14,470 | 4 | % | |||||||
| Junior subordinated debentures | 15,674 | 13,750 | 14 | % | |||||||
| Total interest expense | 66,051 | 58,232 | 13 | % | |||||||
| Net interest income | 844,588 | 871,634 | (3 | )% | |||||||
| Provision for loan and lease losses | 41,674 | 36,589 | 14 | % | |||||||
| Non-interest income: | |||||||||||
| Service charges on deposits | 61,268 | 59,740 | 3 | % | |||||||
| Brokerage revenue | 17,033 | 18,481 | (8 | )% | |||||||
| Residential mortgage banking revenue, net | 157,863 | 124,722 | 27 | % | |||||||
| Gain on investment securities, net | 858 | 2,922 | (71 | )% | |||||||
| Gain on loan sales | 13,356 | 22,380 | (40 | )% | |||||||
| Loss on junior subordinated debentures carried at fair value | (6,323 | ) | (6,306 | ) | 0 | % | |||||
| BOLI income | 8,514 | 8,351 | 2 | % | |||||||
| Other income | 47,371 | 45,434 | 4 | % | |||||||
| Total non-interest income | 299,940 | 275,724 | 9 | % | |||||||
| Non-interest expense: | |||||||||||
| Salaries and employee benefits | 424,830 | 430,936 | (1 | )% | |||||||
| Occupancy and equipment, net | 151,944 | 142,975 | 6 | % | |||||||
| Intangible amortization | 8,622 | 11,225 | (23 | )% | |||||||
| FDIC assessments | 15,508 | 13,480 | 15 | % | |||||||
| (Gain) loss on other real estate owned, net | (279 | ) | 1,894 | (115 | )% | ||||||
| Merger related expenses | 15,313 | 45,582 | (66 | )% | |||||||
| Goodwill Impairment | 142 | — | nm | ||||||||
| Other expense | 121,075 | 117,550 | 3 | % | |||||||
| Total non-interest expense | 737,155 | 763,642 | (3 | )% | |||||||
| Income before provision for income taxes | 365,699 | 347,127 | 5 | % | |||||||
| Provision for income taxes | 132,759 | 124,588 | 7 | % | |||||||
| Net income | 232,940 | 222,539 | 5 | % | |||||||
| Dividends and undistributed earnings allocated to participating securities | 125 | 357 | (65 | )% | |||||||
| Net earnings available to common shareholders | $ | 232,815 | $ | 222,182 | 5 | % | |||||
| Weighted average basic shares outstanding | 220,282 | 220,327 | 0 | % | |||||||
| Weighted average diluted shares outstanding | 220,908 | 221,045 | 0 | % | |||||||
| Earnings per common share – basic | $ | 1.06 | $ | 1.01 | 5 | % | |||||
| Earnings per common share – diluted | $ | 1.05 | $ | 1.01 | 4 | % | |||||
| nm = not meaningful | |||||||||||
| Umpqua Holdings Corporation Consolidated Balance Sheets | ||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||
| % Change | ||||||||||||||||||||||||||
| (In thousands, except per share data) | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Seq. Quarter | Year over Year | |||||||||||||||||||
| Assets: | ||||||||||||||||||||||||||
| Noninterest bearing cash | $ | 331,994 | $ | 364,013 | $ | 369,535 | $ | 299,871 | $ | 277,645 | (9 | )% | 20 | % | ||||||||||||
| Interest bearing deposits and temporary investments | 1,117,438 | 1,102,428 | 535,828 | 613,049 | 496,080 | 1 | % | 125 | % | |||||||||||||||||
| Investment securities: | ||||||||||||||||||||||||||
| Trading, at fair value | 10,964 | 10,866 | 10,188 | 9,791 | 9,586 | 1 | % | 14 | % | |||||||||||||||||
| Available for sale, at fair value | 2,701,220 | 2,520,037 | 2,482,072 | 2,542,535 | 2,522,539 | 7 | % | 7 | % | |||||||||||||||||
| Held to maturity, at amortized cost | 4,216 | 4,302 | 4,382 | 4,525 | 4,609 | (2 | )% | (9 | )% | |||||||||||||||||
| Loans held for sale | 387,318 | 565,624 | 552,681 | 659,264 | 363,275 | (32 | )% | 7 | % | |||||||||||||||||
| Loans and leases | 17,508,663 | 17,392,051 | 17,355,240 | 16,955,583 | 16,866,536 | 1 | % | 4 | % | |||||||||||||||||
| Allowance for loan and lease losses | (133,984 | ) | (133,692 | ) | (131,042 | ) | (130,243 | ) | (130,322 | ) | 0 | % | 3 | % | ||||||||||||
| Loans and leases, net | 17,374,679 | 17,258,359 | 17,224,198 | 16,825,340 | 16,736,214 | 1 | % | 4 | % | |||||||||||||||||
| Restricted equity securities | 45,528 | 47,537 | 47,542 | 47,545 | 46,949 | (4 | )% | (3 | )% | |||||||||||||||||
| Premises and equipment, net | 303,882 | 306,287 | 312,647 | 322,822 | 328,734 | (1 | )% | (8 | )% | |||||||||||||||||
| Goodwill | 1,787,651 | 1,787,651 | 1,787,651 | 1,787,651 | 1,787,793 | 0 | % | 0 | % | |||||||||||||||||
| Other intangible assets, net | 36,886 | 38,753 | 40,620 | 42,948 | 45,508 | (5 | )% | (19 | )% | |||||||||||||||||
| Residential mortgage servicing rights, at fair value | 142,973 | 114,446 | 112,095 | 117,172 | 131,817 | 25 | % | 8 | % | |||||||||||||||||
| Other real estate owned | 6,738 | 8,309 | 16,437 | 20,411 | 22,307 | (19 | )% | (70 | )% | |||||||||||||||||
| Bank owned life insurance | 299,673 | 297,561 | 295,444 | 293,703 | 291,892 | 1 | % | 3 | % | |||||||||||||||||
| Deferred tax assets, net | 34,322 | 27,587 | 63,038 | 108,865 | 138,082 | 24 | % | (75 | )% | |||||||||||||||||
| Other assets | 227,637 | 290,454 | 278,149 | 240,194 | 203,351 | (22 | )% | 12 | % | |||||||||||||||||
| Total assets | $ | 24,813,119 | $ | 24,744,214 | $ | 24,132,507 | $ | 23,935,686 | $ | 23,406,381 | 0 | % | 6 | % | ||||||||||||
| Liabilities: | ||||||||||||||||||||||||||
| Deposits | $ | 19,020,985 | $ | 18,918,780 | $ | 18,258,474 | $ | 18,162,974 | $ | 17,707,189 | 1 | % | 7 | % | ||||||||||||
| Securities sold under agreements to repurchase | 352,948 | 309,463 | 360,234 | 325,203 | 304,560 | 14 | % | 16 | % | |||||||||||||||||
| Term debt | 852,397 | 902,678 | 902,999 | 903,382 | 888,769 | (6 | )% | (4 | )% | |||||||||||||||||
| Junior subordinated debentures, at fair value | 262,209 | 260,114 | 258,660 | 256,917 | 255,457 | 1 | % | 3 | % | |||||||||||||||||
| Junior subordinated debentures, at amortized cost | 100,931 | 101,012 | 101,093 | 101,173 | 101,254 | 0 | % | 0 | % | |||||||||||||||||
| Other liabilities | 306,854 | 331,959 | 348,889 | 307,407 | 299,818 | (8 | )% | 2 | % | |||||||||||||||||
| Total liabilities | 20,896,324 | 20,824,006 | 20,230,349 | 20,057,056 | 19,557,047 | 0 | % | 7 | % | |||||||||||||||||
| Shareholders' equity: | ||||||||||||||||||||||||||
| Common stock | 3,515,299 | 3,514,858 | 3,517,240 | 3,518,792 | 3,520,591 | 0 | % | 0 | % | |||||||||||||||||
| Retained earnings | 422,839 | 388,678 | 362,258 | 343,421 | 331,301 | 9 | % | 28 | % | |||||||||||||||||
| Accumulated other comprehensive (loss) income | (21,343 | ) | 16,672 | 22,660 | 16,417 | (2,558 | ) | (228 | )% | 734 | % | |||||||||||||||
| Total shareholders' equity | 3,916,795 | 3,920,208 | 3,902,158 | 3,878,630 | 3,849,334 | 0 | % | 2 | % | |||||||||||||||||
| Total liabilities and shareholders' equity | $ | 24,813,119 | $ | 24,744,214 | $ | 24,132,507 | $ | 23,935,686 | $ | 23,406,381 | 0 | % | 6 | % | ||||||||||||
| Common shares outstanding at period end | 220,177 | 220,207 | 220,482 | 220,171 | 220,171 | 0 | % | 0 | % | |||||||||||||||||
| Book value per common share | $ | 17.79 | $ | 17.80 | $ | 17.70 | $ | 17.62 | $ | 17.48 | 0 | % | 2 | % | ||||||||||||
| Tangible book value per common share | $ | 9.50 | $ | 9.51 | $ | 9.41 | $ | 9.30 | $ | 9.16 | 0 | % | 4 | % | ||||||||||||
| Tangible equity - common | $ | 2,092,258 | $ | 2,093,804 | $ | 2,073,887 | $ | 2,048,031 | $ | 2,016,033 | 0 | % | 4 | % | ||||||||||||
| Tangible common equity to tangible assets | 9.10 | % | 9.14 | % | 9.30 | % | 9.26 | % | 9.35 | % | (0.04 | ) | (0.25 | ) | ||||||||||||
| Umpqua Holdings Corporation | ||||||||||||||||||||||||||
| Loan & Lease Portfolio | ||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||
| (Dollars in thousands) | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | % Change | ||||||||||||||||||||
| Amount | Amount | Amount | Amount | Amount | Seq. Quarter | Year over Year | ||||||||||||||||||||
| Loans & leases: | ||||||||||||||||||||||||||
| Commercial real estate: | ||||||||||||||||||||||||||
| Non-owner occupied term, net | $ | 3,330,442 | $ | 3,280,660 | $ | 3,377,464 | $ | 3,202,488 | $ | 3,226,836 | 2 | % | 3 | % | ||||||||||||
| Owner occupied term, net | 2,599,055 | 2,573,942 | 2,581,786 | 2,714,766 | 2,582,874 | 1 | % | 1 | % | |||||||||||||||||
| Multifamily, net | 2,858,956 | 2,968,019 | 3,004,890 | 2,959,975 | 3,151,516 | (4 | )% | (9 | )% | |||||||||||||||||
| Commercial construction, net | 463,625 | 388,934 | 367,879 | 338,801 | 271,119 | 19 | % | 71 | % | |||||||||||||||||
| Residential development, net | 142,984 | 127,447 | 111,941 | 121,025 | 99,459 | 12 | % | 44 | % | |||||||||||||||||
| Commercial: | ||||||||||||||||||||||||||
| Term, net | 1,508,780 | 1,480,173 | 1,440,704 | 1,412,816 | 1,408,676 | 2 | % | 7 | % | |||||||||||||||||
| Lines of credit & other, net | 1,116,259 | 1,142,946 | 1,116,876 | 1,036,389 | 1,036,733 | (2 | )% | 8 | % | |||||||||||||||||
| Leases & equipment finance, net | 950,588 | 927,857 | 884,506 | 791,798 | 729,161 | 2 | % | 30 | % | |||||||||||||||||
| Residential real estate: | ||||||||||||||||||||||||||
| Mortgage, net | 2,887,971 | 2,868,337 | 2,882,076 | 2,879,600 | 2,909,306 | 1 | % | (1 | )% | |||||||||||||||||
| Home equity lines & loans, net | 1,011,844 | 1,008,219 | 989,814 | 943,254 | 923,667 | 0 | % | 10 | % | |||||||||||||||||
| Consumer & other, net | 638,159 | 625,517 | 597,304 | 554,671 | 527,189 | 2 | % | 21 | % | |||||||||||||||||
| Total, net of deferred fees and costs | $ | 17,508,663 | $ | 17,392,051 | $ | 17,355,240 | $ | 16,955,583 | $ | 16,866,536 | 1 | % | 4 | % | ||||||||||||
| Loan & leases mix: | ||||||||||||||||||||||||||
| Commercial real estate: | ||||||||||||||||||||||||||
| Non-owner occupied term, net | 19 | % | 19 | % | 19 | % | 19 | % | 19 | % | ||||||||||||||||
| Owner occupied term, net | 15 | % | 15 | % | 15 | % | 16 | % | 15 | % | ||||||||||||||||
| Multifamily, net | 16 | % | 17 | % | 17 | % | 17 | % | 19 | % | ||||||||||||||||
| Commercial construction, net | 3 | % | 2 | % | 2 | % | 2 | % | 2 | % | ||||||||||||||||
| Residential development, net | 1 | % | 1 | % | 1 | % | 1 | % | 1 | % | ||||||||||||||||
| Commercial: | ||||||||||||||||||||||||||
| Term, net | 9 | % | 8 | % | 8 | % | 8 | % | 9 | % | ||||||||||||||||
| Lines of credit & other, net | 6 | % | 7 | % | 6 | % | 6 | % | 6 | % | ||||||||||||||||
| Leases & equipment finance, net | 5 | % | 5 | % | 6 | % | 5 | % | 4 | % | ||||||||||||||||
| Residential real estate: | ||||||||||||||||||||||||||
| Mortgage, net | 16 | % | 16 | % | 17 | % | 17 | % | 17 | % | ||||||||||||||||
| Home equity lines & loans, net | 6 | % | 6 | % | 6 | % | 6 | % | 5 | % | ||||||||||||||||
| Consumer & other, net | 4 | % | 4 | % | 3 | % | 3 | % | 3 | % | ||||||||||||||||
| Total | 100 | % | 100 | % | 100 | % | 100 | % | 100 | % | ||||||||||||||||
| Umpqua Holdings Corporation | ||||||||||||||||||||||||||
| Deposits by Type/Core Deposits | ||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||
| (Dollars in thousands) | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | % Change | ||||||||||||||||||||
| Amount | Amount | Amount | Amount | Amount | Seq. Quarter | Year over Year | ||||||||||||||||||||
| Deposits: | ||||||||||||||||||||||||||
| Demand, non-interest bearing | $ | 5,861,469 | $ | 5,993,793 | $ | 5,475,986 | $ | 5,460,310 | $ | 5,318,591 | (2 | )% | 10 | % | ||||||||||||
| Demand, interest bearing | 2,296,532 | 2,218,782 | 2,186,164 | 2,178,446 | 2,157,376 | 4 | % | 6 | % | |||||||||||||||||
| Money market | 6,932,717 | 6,841,700 | 6,782,232 | 6,814,160 | 6,599,516 | 1 | % | 5 | % | |||||||||||||||||
| Savings | 1,325,757 | 1,303,816 | 1,254,675 | 1,213,049 | 1,136,809 | 2 | % | 17 | % | |||||||||||||||||
| Time | 2,604,510 | 2,560,689 | 2,559,417 | 2,497,009 | 2,494,897 | 2 | % | 4 | % | |||||||||||||||||
| Total | $ | 19,020,985 | $ | 18,918,780 | $ | 18,258,474 | $ | 18,162,974 | $ | 17,707,189 | 1 | % | 7 | % | ||||||||||||
| Total core deposits (1) | $ | 17,318,003 | $ | 17,257,663 | $ | 16,598,065 | $ | 16,559,943 | $ | 16,102,743 | 0 | % | 8 | % | ||||||||||||
| Deposit mix: | ||||||||||||||||||||||||||
| Demand, non-interest bearing | 31 | % | 31 | % | 30 | % | 30 | % | 30 | % | ||||||||||||||||
| Demand, interest bearing | 12 | % | 12 | % | 12 | % | 12 | % | 12 | % | ||||||||||||||||
| Money market | 36 | % | 36 | % | 37 | % | 37 | % | 37 | % | ||||||||||||||||
| Savings | 7 | % | 7 | % | 7 | % | 7 | % | 6 | % | ||||||||||||||||
| Time | 14 | % | 14 | % | 14 | % | 14 | % | 15 | % | ||||||||||||||||
| Total | 100 | % | 100 | % | 100 | % | 100 | % | 100 | % | ||||||||||||||||
| Number of open accounts: | ||||||||||||||||||||||||||
| Demand, non-interest bearing | 384,040 | 382,687 | 379,996 | 375,913 | 371,745 | |||||||||||||||||||||
| Demand, interest bearing | 82,520 | 83,501 | 84,434 | 85,731 | 86,745 | |||||||||||||||||||||
| Money market | 56,031 | 56,128 | 56,492 | 56,927 | 57,194 | |||||||||||||||||||||
| Savings | 159,080 | 158,760 | 157,849 | 156,846 | 154,176 | |||||||||||||||||||||
| Time | 47,705 | 47,689 | 47,850 | 47,794 | 47,672 | |||||||||||||||||||||
| Total | 729,376 | 728,765 | 726,621 | 723,211 | 717,532 | |||||||||||||||||||||
| Average balance per account: | ||||||||||||||||||||||||||
| Demand, non-interest bearing | $ | 15.3 | $ | 15.7 | $ | 14.4 | $ | 14.5 | $ | 14.3 | ||||||||||||||||
| Demand, interest bearing | 27.8 | 26.6 | 25.9 | 25.4 | 24.9 | |||||||||||||||||||||
| Money market | 123.7 | 121.9 | 120.1 | 119.7 | 115.4 | |||||||||||||||||||||
| Savings | 8.3 | 8.2 | 7.9 | 7.7 | 7.4 | |||||||||||||||||||||
| Time | 54.6 | 53.7 | 53.5 | 52.2 | 52.3 | |||||||||||||||||||||
| Total | $ | 26.1 | $ | 26.0 | $ | 25.1 | $ | 25.1 | $ | 24.7 | ||||||||||||||||
| (1) Core deposits are defined as total deposits less time deposits greater than $100,000. | ||||||||||||||||||||||||||
| Umpqua Holdings Corporation | ||||||||||||||||||||||||||
| Credit Quality – Non-performing Assets | ||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||
| Quarter Ended | % Change | |||||||||||||||||||||||||
| (Dollars in thousands) | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Seq. Quarter | Year over Year | |||||||||||||||||||
| Non-performing assets: | ||||||||||||||||||||||||||
| Loans and leases on non-accrual status | $ | 27,765 | $ | 27,791 | $ | 25,136 | $ | 30,045 | $ | 29,215 | 0 | % | (5 | )% | ||||||||||||
| Loans and leases past due 90+ days & accruing (1) | 28,369 | 26,189 | 23,076 | 22,144 | 15,169 | 8 | % | 87 | % | |||||||||||||||||
| Total non-performing loans and leases | 56,134 | 53,980 | 48,212 | 52,189 | 44,384 | 4 | % | 26 | % | |||||||||||||||||
| Other real estate owned | 6,738 | 8,309 | 16,437 | 20,411 | 22,307 | (19 | )% | (70 | )% | |||||||||||||||||
| Total non-preforming assets | $ | 62,872 | $ | 62,289 | $ | 64,649 | $ | 72,600 | $ | 66,691 | 1 | % | (6 | )% | ||||||||||||
| Performing restructured loans and leases | $ | 40,667 | $ | 36,645 | $ | 40,848 | $ | 31,409 | $ | 31,355 | 11 | % | 30 | % | ||||||||||||
| Loans and leases past due 31-89 days | $ | 30,425 | $ | 39,708 | $ | 29,640 | $ | 29,054 | $ | 28,423 | (23 | )% | 7 | % | ||||||||||||
| Loans and leases past due 31-89 days to total loans and leases | 0.17 | % | 0.23 | % | 0.17 | % | 0.17 | % | 0.17 | % | ||||||||||||||||
| Non-performing loans and leases to total loans and leases (1) | 0.32 | % | 0.31 | % | 0.28 | % | 0.31 | % | 0.26 | % | ||||||||||||||||
| Non-performing assets to total assets (1) | 0.25 | % | 0.25 | % | 0.27 | % | 0.30 | % | 0.28 | % | ||||||||||||||||
| (1) Excludes non-performing mortgage loans guaranteed by Ginnie Mae, which Umpqua has the unilateral right to repurchase but has not done so, totaling $10.9 million, $7.3 million, $11.3 million, $14.2 million, and $19.2 million at December 31, 2016, September 30, 2016, June 30, 2016, March 31, 2016, and December 31, 2015, respectively. | ||||||||||||||||||||||||||
| Umpqua Holdings Corporation | ||||||||||||||||||||||||||
| Credit Quality – Allowance for Loan and Lease Losses | ||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||
| Quarter Ended | % Change | |||||||||||||||||||||||||
| (Dollars in thousands) | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Seq. Quarter | Year over Year | |||||||||||||||||||
| Allowance for loan and lease losses: | ||||||||||||||||||||||||||
| Balance beginning of period | $ | 133,692 | $ | 131,042 | $ | 130,243 | $ | 130,322 | $ | 130,133 | ||||||||||||||||
| Provision for loan and lease losses | 13,171 | 13,091 | 10,589 | 4,823 | 4,545 | 1 | % | 190 | % | |||||||||||||||||
| Charge-offs | (16,303 | ) | (13,088 | ) | (12,682 | ) | (7,850 | ) | (7,108 | ) | 25 | % | 129 | % | ||||||||||||
| Recoveries | 3,424 | 2,647 | 2,892 | 2,948 | 2,752 | 29 | % | 24 | % | |||||||||||||||||
| Net charge-offs | (12,879 | ) | (10,441 | ) | (9,790 | ) | (4,902 | ) | (4,356 | ) | 23 | % | 196 | % | ||||||||||||
| Total allowance for loan and lease losses | 133,984 | 133,692 | 131,042 | 130,243 | 130,322 | 0 | % | 3 | % | |||||||||||||||||
| Reserve for unfunded commitments | 3,611 | 3,536 | 3,531 | 3,482 | 3,574 | 2 | % | 1 | % | |||||||||||||||||
| Total allowance for credit losses | $ | 137,595 | $ | 137,228 | $ | 134,573 | $ | 133,725 | $ | 133,896 | 0 | % | 3 | % | ||||||||||||
| Net charge-offs to average loans and leases (annualized) | 0.29 | % | 0.24 | % | 0.23 | % | 0.12 | % | 0.10 | % | ||||||||||||||||
| Recoveries to gross charge-offs | 21.00 | % | 20.22 | % | 22.80 | % | 37.55 | % | 38.72 | % | ||||||||||||||||
| Allowance for loan and lease losses to loans and leases | 0.77 | % | 0.77 | % | 0.76 | % | 0.77 | % | 0.77 | % | ||||||||||||||||
| Allowance for credit losses to loans and leases | 0.79 | % | 0.79 | % | 0.78 | % | 0.79 | % | 0.79 | % | ||||||||||||||||
| Umpqua Holdings Corporation | |||||||||||
| Credit Quality – Allowance for Loan and Lease Losses | |||||||||||
| (Unaudited) | |||||||||||
| Year Ended | % Change | ||||||||||
| (Dollars in thousands) | Dec 31, 2016 | Dec 31, 2015 | Year over Year | ||||||||
| Allowance for credit losses: | |||||||||||
| Balance beginning of period | $ | 130,322 | $ | 116,167 | |||||||
| Provision for loan and lease losses | 41,674 | 36,589 | 14 | % | |||||||
| Charge-offs | (49,923 | ) | (35,571 | ) | 40 | % | |||||
| Recoveries | 11,911 | 13,137 | (9 | )% | |||||||
| Net charge-offs | (38,012 | ) | (22,434 | ) | 69 | % | |||||
| Total allowance for loan and lease losses | 133,984 | 130,322 | 3 | % | |||||||
| Reserve for unfunded commitments | 3,611 | 3,574 | 1 | % | |||||||
| Total allowance for credit losses | $ | 137,595 | $ | 133,896 | 3 | % | |||||
| Net charge-offs to average loans and leases | 0.22 | % | 0.14 | % | |||||||
| Recoveries to gross charge-offs | 23.86 | % | 36.93 | % | |||||||
| Umpqua Holdings Corporation | |||||||||||||||||||||
| Selected Ratios | |||||||||||||||||||||
| (Unaudited) | |||||||||||||||||||||
| Quarter Ended | % Change | ||||||||||||||||||||
| Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Seq. Quarter | Year over Year | |||||||||||||||
| Average Rates: | |||||||||||||||||||||
| Yield on loans and leases | 4.70 | % | 4.75 | % | 4.81 | % | 5.07 | % | 5.21 | % | (0.05 | ) | (0.51 | ) | |||||||
| Yield on loans held for sale | 3.79 | % | 3.79 | % | 3.80 | % | 4.06 | % | 3.83 | % | — | (0.04 | ) | ||||||||
| Yield on taxable investments | 1.85 | % | 1.96 | % | 2.14 | % | 2.32 | % | 2.26 | % | (0.11 | ) | (0.41 | ) | |||||||
| Yield on tax-exempt investments (1) | 4.72 | % | 4.68 | % | 4.73 | % | 4.73 | % | 4.76 | % | 0.04 | (0.04 | ) | ||||||||
| Yield on temporary investments & interest bearing cash | 0.56 | % | 0.50 | % | 0.51 | % | 0.54 | % | 0.28 | % | 0.06 | 0.28 | |||||||||
| Total yield on earning assets (1) | 4.14 | % | 4.26 | % | 4.39 | % | 4.66 | % | 4.69 | % | (0.12 | ) | (0.55 | ) | |||||||
| Cost of interest bearing deposits | 0.28 | % | 0.28 | % | 0.27 | % | 0.27 | % | 0.26 | % | — | 0.02 | |||||||||
| Cost of securities sold under agreements | |||||||||||||||||||||
| to repurchase and fed funds purchased | 0.04 | % | 0.04 | % | 0.04 | % | 0.05 | % | 0.05 | % | — | (0.01 | ) | ||||||||
| Cost of term debt | 1.53 | % | 1.57 | % | 1.72 | % | 1.88 | % | 1.73 | % | (0.04 | ) | (0.20 | ) | |||||||
| Cost of junior subordinated debentures | 4.59 | % | 4.36 | % | 4.30 | % | 4.20 | % | 3.96 | % | 0.23 | 0.63 | |||||||||
| Total cost of interest bearing liabilities | 0.46 | % | 0.46 | % | 0.46 | % | 0.47 | % | 0.44 | % | — | 0.02 | |||||||||
| Net interest spread (1) | 3.68 | % | 3.80 | % | 3.93 | % | 4.19 | % | 4.25 | % | (0.12 | ) | (0.57 | ) | |||||||
| Net interest margin (1) | 3.83 | % | 3.95 | % | 4.07 | % | 4.34 | % | 4.39 | % | (0.12 | ) | (0.56 | ) | |||||||
| As reported (GAAP): | |||||||||||||||||||||
| Return on average assets | 1.11 | % | 1.01 | % | 0.91 | % | 0.82 | % | 1.08 | % | 0.10 | 0.03 | |||||||||
| Return on average tangible assets | 1.20 | % | 1.09 | % | 0.99 | % | 0.89 | % | 1.17 | % | 0.11 | 0.03 | |||||||||
| Return on average common equity | 7.04 | % | 6.28 | % | 5.61 | % | 4.93 | % | 6.49 | % | 0.76 | 0.55 | |||||||||
| Return on average tangible common equity | 13.19 | % | 11.79 | % | 10.59 | % | 9.34 | % | 12.41 | % | 1.40 | 0.78 | |||||||||
| Efficiency ratio – Consolidated | 59.65 | % | 62.11 | % | 66.15 | % | 69.48 | % | 64.02 | % | (2.46 | ) | (4.37 | ) | |||||||
| Efficiency ratio – Bank | 57.96 | % | 60.45 | % | 64.44 | % | 67.29 | % | 62.40 | % | (2.49 | ) | (4.44 | ) | |||||||
| Operating basis (non-GAAP): (2) | |||||||||||||||||||||
| Return on average assets | 0.97 | % | 1.13 | % | 1.16 | % | 1.10 | % | 1.10 | % | (0.16 | ) | (0.13 | ) | |||||||
| Return on average tangible assets | 1.05 | % | 1.22 | % | 1.26 | % | 1.19 | % | 1.20 | % | (0.17 | ) | (0.15 | ) | |||||||
| Return on average common equity | 6.12 | % | 7.08 | % | 7.16 | % | 6.63 | % | 6.64 | % | (0.96 | ) | (0.52 | ) | |||||||
| Return on average tangible common equity | 11.47 | % | 13.28 | % | 13.51 | % | 12.57 | % | 12.70 | % | (1.81 | ) | (1.23 | ) | |||||||
| Efficiency ratio – Consolidated | 62.15 | % | 58.96 | % | 59.78 | % | 62.49 | % | 63.00 | % | 3.19 | (0.85 | ) | ||||||||
| Efficiency ratio – Bank | 60.67 | % | 57.66 | % | 58.48 | % | 60.89 | % | 61.72 | % | 3.01 | (1.05 | ) | ||||||||
(1) Tax exempt interest has been adjusted to a taxable equivalent basis using a 35% tax rate.
(2) Operating earnings is calculated as earnings available to common shareholders excluding the after-tax impact of merger-related expenses, gains or losses on junior subordinated debentures carried at fair value, gains or losses from the change in fair value of the MSR, gains or losses from the change in fair value of the swap derivative, net gains or losses in investment securities, exit or disposal costs, bargain purchase gain on acquisitions and goodwill impairment.
| Umpqua Holdings Corporation | |||||||||
| Selected Ratios | |||||||||
| (Unaudited) | |||||||||
| Year Ended | % Change | ||||||||
| Dec 31, 2016 | Dec 31, 2015 | Year over Year | |||||||
| Average Rates: | |||||||||
| Yield on loans and leases | 4.83 | % | 5.38 | % | (0.55 | ) | |||
| Yield on loans held for sale | 3.84 | % | 3.72 | % | 0.12 | ||||
| Yield on taxable investments | 2.07 | % | 2.13 | % | (0.06 | ) | |||
| Yield on tax-exempt investments (1) | 4.71 | % | 4.73 | % | (0.02 | ) | |||
| Yield on temporary investments & interest bearing cash | 0.53 | % | 0.26 | % | 0.27 | ||||
| Total yield on earning assets (1) | 4.36 | % | 4.74 | % | (0.38 | ) | |||
| Cost of interest bearing deposits | 0.28 | % | 0.24 | % | 0.04 | ||||
| Cost of securities sold under agreements | |||||||||
| to repurchase and fed funds purchased | 0.04 | % | 0.05 | % | (0.01 | ) | |||
| Cost of term debt | 1.67 | % | 1.57 | % | 0.10 | ||||
| Cost of junior subordinated debentures | 4.37 | % | 3.90 | % | 0.47 | ||||
| Total cost of interest bearing liabilities | 0.46 | % | 0.42 | % | 0.04 | ||||
| Net interest spread (1) | 3.90 | % | 4.32 | % | (0.42 | ) | |||
| Net interest margin (1) | 4.04 | % | 4.44 | % | (0.40 | ) | |||
| As reported (GAAP): | |||||||||
| Return on average assets | 0.97 | % | 0.97 | % | — | ||||
| Return on average tangible assets | 1.04 | % | 1.06 | % | (0.02 | ) | |||
| Return on average common equity | 5.97 | % | 5.82 | % | 0.15 | ||||
| Return on average tangible common equity | 11.25 | % | 12.08 | % | (0.83 | ) | |||
| Efficiency ratio – Consolidated | 64.15 | % | 66.27 | % | (2.12 | ) | |||
| Efficiency ratio – Bank | 62.35 | % | 64.57 | % | (2.22 | ) | |||
| Operating basis (non-GAAP): (2) | |||||||||
| Return on average assets | 1.09 | % | 1.15 | % | (0.06 | ) | |||
| Return on average tangible assets | 1.18 | % | 1.26 | % | (0.08 | ) | |||
| Return on average common equity | 6.74 | % | 6.91 | % | (0.17 | ) | |||
| Return on average tangible common equity | 12.70 | % | 14.35 | % | (1.65 | ) | |||
| Efficiency ratio – Consolidated | 60.81 | % | 61.04 | % | (0.23 | ) | |||
| Efficiency ratio – Bank | 59.40 | % | 59.76 | % | (0.36 | ) | |||
(1) Tax exempt interest has been adjusted to a taxable equivalent basis using a 35% tax rate.
(2) Operating earnings is calculated as earnings available to common shareholders excluding the after-tax impact of merger-related expenses, gains or losses on junior subordinated debentures carried at fair value, gains or losses from the change in fair value of the MSR, gains or losses from the change in fair value of the swap derivative, net gains or losses in investment securities, exit or disposal costs, bargain purchase gain on acquisitions and goodwill impairment.
| Umpqua Holdings Corporation Average Balances | ||||||||||||||||||||||||||
| (Unaudited) | ||||||||||||||||||||||||||
| Quarter Ended | % Change | |||||||||||||||||||||||||
| (Dollars in thousands) | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Seq. Quarter | Year over Year | |||||||||||||||||||
| Temporary investments & interest bearing cash | $ | 1,194,904 | $ | 874,410 | $ | 514,881 | $ | 356,674 | $ | 608,250 | 37 | % | 96 | % | ||||||||||||
| Investment securities, taxable | 2,373,652 | 2,265,883 | 2,304,998 | 2,311,589 | 2,293,429 | 5 | % | 3 | % | |||||||||||||||||
| Investment securities, tax-exempt | 287,359 | 283,818 | 280,841 | 287,085 | 302,443 | 1 | % | (5 | )% | |||||||||||||||||
| Loans held for sale | 482,028 | 481,740 | 403,964 | 297,732 | 334,404 | 0 | % | 44 | % | |||||||||||||||||
| Loans and leases | 17,386,385 | 17,400,657 | 17,234,220 | 17,008,084 | 16,514,770 | 0 | % | 5 | % | |||||||||||||||||
| Total interest earning assets | 21,724,328 | 21,306,508 | 20,738,904 | 20,261,164 | 20,053,296 | 2 | % | 8 | % | |||||||||||||||||
| Goodwill & other intangible assets, net | 1,825,491 | 1,827,405 | 1,829,407 | 1,832,046 | 1,835,821 | 0 | % | (1 | )% | |||||||||||||||||
| Total assets | 24,740,986 | 24,422,986 | 23,896,315 | 23,415,439 | 23,196,052 | 1 | % | 7 | % | |||||||||||||||||
| Non-interest bearing demand deposits | 5,939,223 | 5,766,022 | 5,466,098 | 5,289,810 | 5,285,992 | 3 | % | 12 | % | |||||||||||||||||
| Interest bearing deposits | 13,026,614 | 12,836,987 | 12,644,442 | 12,411,005 | 12,249,333 | 1 | % | 6 | % | |||||||||||||||||
| Total deposits | 18,965,837 | 18,603,009 | 18,110,540 | 17,700,815 | 17,535,325 | 2 | % | 8 | % | |||||||||||||||||
| Interest bearing liabilities | 14,606,120 | 14,446,687 | 14,249,349 | 13,976,678 | 13,812,645 | 1 | % | 6 | % | |||||||||||||||||
| Shareholders’ equity - common | 3,914,624 | 3,911,323 | 3,889,593 | 3,878,540 | 3,847,587 | 0 | % | 2 | % | |||||||||||||||||
| Tangible common equity (1) | 2,089,133 | 2,083,918 | 2,060,186 | 2,046,494 | 2,011,766 | 0 | % | 4 | % | |||||||||||||||||
| Umpqua Holdings Corporation Average Balances | |||||||||||
| (Unaudited) | |||||||||||
| Year Ended | % Change | ||||||||||
| (Dollars in thousands) | Dec 31, 2016 | Dec 31, 2015 | Year over Year | ||||||||
| Temporary investments & interest bearing cash | $ | 736,854 | $ | 869,253 | (15 | )% | |||||
| Investment securities, taxable | 2,314,062 | 2,275,512 | 2 | % | |||||||
| Investment securities, tax-exempt | 284,780 | 310,684 | (8 | )% | |||||||
| Loans held for sale | 416,724 | 333,455 | 25 | % | |||||||
| Loans and leases | 17,258,081 | 15,938,127 | 8 | % | |||||||
| Total interest earning assets | 21,010,501 | 19,727,031 | 7 | % | |||||||
| Goodwill & other intangible assets, net | 1,828,575 | 1,980,905 | (8 | )% | |||||||
| Total assets | 24,121,462 | 22,905,541 | 5 | % | |||||||
| Non-interest bearing demand deposits | 5,616,585 | 5,015,508 | 12 | % | |||||||
| Interest bearing deposits | 12,730,866 | 12,235,302 | 4 | % | |||||||
| Total deposits | 18,347,451 | 17,250,810 | 6 | % | |||||||
| Interest bearing liabilities | 14,320,838 | 13,833,245 | 4 | % | |||||||
| Shareholders’ equity - common | 3,898,599 | 3,820,505 | 2 | % | |||||||
| Tangible common equity (1) | 2,070,024 | 1,839,600 | 13 | % | |||||||
(1) Average tangible common equity is a non-GAAP financial measure. Average tangible common equity is calculated as average common shareholders’ equity less average goodwill and other intangible assets, net (excluding MSRs).
| Umpqua Holdings Corporation Residential Mortgage Banking Activity | ||||||||||||||||||||||||||
| (unaudited) | ||||||||||||||||||||||||||
| Quarter Ended | % Change | |||||||||||||||||||||||||
| (Dollars in thousands) | Dec 31, 2016 | Sep 30, 2016 | Jun 30, 2016 | Mar 31, 2016 | Dec 31, 2015 | Seq. Quarter | Year over Year | |||||||||||||||||||
| Residential mortgage servicing rights: | ||||||||||||||||||||||||||
| Residential mortgage loans serviced for others | $ | 14,327,368 | $ | 13,880,660 | $ | 13,564,242 | $ | 13,304,468 | $ | 13,047,266 | 3 | % | 10 | % | ||||||||||||
| MSR asset, at fair value | 142,973 | 114,446 | 112,095 | 117,172 | 131,817 | 25 | % | 8 | % | |||||||||||||||||
| MSR as % of serviced portfolio | 1.00 | % | 0.82 | % | 0.83 | % | 0.88 | % | 1.01 | % | ||||||||||||||||
| Residential mortgage banking revenue: | ||||||||||||||||||||||||||
| Origination and sale | $ | 32,386 | $ | 45,631 | $ | 42,083 | $ | 28,409 | $ | 25,363 | (29 | )% | 28 | % | ||||||||||||
| Servicing | 9,597 | 9,401 | 8,640 | 7,642 | 7,546 | 2 | % | 27 | % | |||||||||||||||||
| Change in fair value of MSR asset | 16,465 | (7,826 | ) | (13,940 | ) | (20,625 | ) | (469 | ) | (310 | )% | nm | ||||||||||||||
| Total | $ | 58,448 | $ | 47,206 | $ | 36,783 | $ | 15,426 | $ | 32,440 | 24 | % | 80 | % | ||||||||||||
| Closed loan volume: | ||||||||||||||||||||||||||
| Closed loan volume - portfolio | $ | 250,000 | $ | 305,648 | $ | 365,926 | $ | 332,918 | $ | 352,465 | (18 | )% | (29 | )% | ||||||||||||
| Closed loan volume - for-sale | 1,061,327 | 1,118,526 | 1,046,349 | 764,076 | 794,820 | (5 | )% | 34 | % | |||||||||||||||||
| Closed loan volume - total | $ | 1,311,327 | $ | 1,424,174 | 1,412,275 | 1,096,994 | $ | 1,147,285 | (8 | )% | 14 | % | ||||||||||||||
| Gain on sale margin: | ||||||||||||||||||||||||||
| Based on for-sale volume | 3.05 | % | 4.08 | % | 4.02 | % | 3.72 | % | 3.19 | % | (1.03 | ) | (0.14 | ) | ||||||||||||
| Year Ended | % Change | |||||||||||||||||||||||||
| Dec 31, 2016 | Dec 31, 2015 | Year over Year | ||||||||||||||||||||||||
| Residential mortgage banking revenue: | ||||||||||||||||||||||||||
| Origination and sale | $ | 148,509 | $ | 117,432 | 26 | % | ||||||||||||||||||||
| Servicing | 35,280 | 28,013 | 26 | % | ||||||||||||||||||||||
| Change in fair value of MSR asset | (25,926 | ) | (20,723 | ) | 25 | % | ||||||||||||||||||||
| Total | $ | 157,863 | $ | 124,722 | 27 | % | ||||||||||||||||||||
| Closed loan volume: | ||||||||||||||||||||||||||
| Closed loan volume - portfolio | $ | 1,254,492 | $ | 1,556,414 | (19 | )% | ||||||||||||||||||||
| Closed loan volume - for-sale | 3,990,278 | 3,497,920 | 14 | % | ||||||||||||||||||||||
| Closed loan volume - total | $ | 5,244,770 | $ | 5,054,334 | 4 | % | ||||||||||||||||||||
| Gain on sale margin: | ||||||||||||||||||||||||||
| Based on for-sale volume | 3.72 | % | 3.36 | % | 0.36 | |||||||||||||||||||||