United Community Banks, Inc. · NYSE:UCB
United Community Banks — Q3 2015 Earnings Presentation
28 slides from United Community Banks's earnings presentation, Oct 27, 2015
Slide 1: Third Quarter 2015 Investor Presentation
UNITED COMMUNITY BANKS, INC. THIRD QUARTER 2O15 INVESTOR PRESENTATION | Forbes | 2015 United | BEST BANKS COMMUNITY BANKS, INC. BANKS, INC® i IN AMERICA
Slide 2: Disclosures
Disclosures CAUTIONARY STATEMENT This investor presentation may contain forward-looking efficiency ratio, operating dividend payout ratio, core fee statements, as defined by federal securities laws, revenue, core operating expense, core earnings, tangible including statements about United’s financia
Slide 3: Highlights Third Quarter 2015
Highlights Third Quarter 2015 (in millions) 3Q15 2Q15 3Q14 Net Income Operating(1) $ 21.7 $ 20.0 $ 17.6 ($ in millions) GAAP 17.9 17.8 17.6 EPS Operating(1) .33 .32 .29 GAAP .27 .28 .29 ROA Operating(1) 1.00% 1.00% .95% GAAP .82 .89 .95 ROTCE Operating(1) 10.29 10.20 9.55 ROCE GAAP 7.85 8.83 9.41 IM
Slide 4: Highlights Third Quarter 2015
Highlights Third Quarter 2015 IMPROVING QUARTERLY RESULTS ► Growth in Many Sectors Loan ● Loan growth of $53 million, or 4% annualized (excludes Palmetto - $796 million); Growth $310 million growth year-to-date, or 9% annualized ● Loan Production of $452 million vs. $526 million 2Q15 and $453 millio
Slide 5: Trends – Core Earnings, Fee Revenue, and Expenses
Trends – Core Earnings, Fee Revenue, and Expenses $70 Core Earnings Millions $65.7 $35.4 Million $60 $61.3 $57.0 $58.3 $57.6 Up $2.0 million from 2Q15 $50 $48.8 and $45.1 Up $5.1 million from 3Q14 $40 $41.1 $42.1 $42.2 $33.4 $35.4 $30 $30.3 $30.8 $30.5 Net Interest Revenue $20 Core Operating Expense
Slide 6: Key Drivers of Net Interest Revenue / Margin
Key Drivers of Net Interest Revenue / Margin NET INTEREST REVENUE & MARGIN INCREASE IMPACTED BY $66 $65.7 Millions NET INTEREST REVENUE ►One month of $63 Palmetto $61.3 ($3.3M) $60 3.50% $58.3 $57.6 ►Loan mix $57 $57.0 trending to 3.32% 3.31% 3.31% 3.30% $54 3.26% floating rates 3.25% ►Competitive $
Slide 7: Balance Sheet Growth – New Loans Funded and Advances
Balance Sheet Growth – New Loans Funded and Advances(1) $ in Millions New Loans Funded by Category New Loans Funded by Market 3Q15 2Q15 3Q14 Banks: 3Q15 2Q15 3Q14 Commercial C & I $ 94.8 $ 143.1 $ 150.0 Atlanta $ 86.7 $ 116.9 $ 96.7 Owner Occupied CRE 51.4 79.3 48.1 Coastal Georgia 28.2 48.9 38.4 In
Slide 8: Loan Growth
Loan Growth $6.50 Commercial construction $6.02 Billions $6.00 Commercial $5.50 Income producing commercial real estate $5.00 $4.67 Owner occupied commercial real estate $4.50 $4.33 $4.11 $4.18 $4.00 Commercial & industrial $3.50 Indirect auto $3.00 $2.50 Home equity lines of credit Retail $2.00 Res
Slide 9: Balance Sheet Growth – Customer Deposit Mix
Balance Sheet Growth – Customer Deposit Mix $8.00 $7.39 Time & Public Funds $7.50 Billions $7.00 Public funds $6.50 $5.92 $5.90 $6.00 $5.71 $5.78 $5.50 $5.00 Time (customer) $4.50 $4.00 $3.50 Core Transaction $3.00 Interest bearing core transaction $2.50 $2.00 $1.50 $1.00 Non-interest bearing core t
Slide 10: Credit Quality
Credit Quality $ in Millions 3Q15 2Q15 1Q15 4Q14 3Q14 Net Charge-offs $ 1.4 $ 1.0 $ 2.6 $ 2.5 $ 3.2 as % of Average Loans .10 % .08 % .22 % .22 % .28 % Allowance for Loan Losses $ 69.1 $ 70.1 $ 70.0 $ 71.6 $ 71.9 as % of Total Loans 1.15 % 1.36 % 1.46 % 1.53 % 1.57 % as % of Total Loans, Excluding M
Slide 11: Operating Earnings per Share and Operating Return on Assets
Operating Earnings per Share and Operating Return on Assets OPERATING EARNINGS PER SHARE(1) OPERATING RETURN ON ASSETS(1) $.34 $.33 1.00% 1.00% 1.00% $.32 $.32 .95% .96% $.30 .95% .94% $.30 $.29 $.29 $.28 .90% $.26 .85% $.24 .80% $.22 .75% $.20 $.18 .70% 3Q14 4Q14 1Q15 2Q15 3Q15 3Q14 4Q14 1Q15 2Q15
Slide 12: Capital Ratios
Capital Ratios(1) HOLDING COMPANY Well-Cap 3Q15 2Q15 1Q15 4Q14 3Q14 Tier I RBC 8.0% 11.0% 11.9% 11.5% 12.1% 12.1% Total RBC 10.0 12.1 13.1 12.8 13.3 13.3 Leverage 5.0 8.2 9.1 8.7 8.7 8.7 Tier I Common RBC 6.5 11.0 11.9 11.5 11.1 11.0 Tangible Common equity to Assets 9.8 9.8 9.8 9.7 9.8 Tangible Equi
Slide 13: Strategic Principles
Strategic Principles LEVERAGE OUR STRENGTHS ► Community bank service with large bank resources ► Strong local leadership and senior management ► Funding strength in legacy markets ► Consistent and attractive culture ► Class leading customer satisfaction 2015 ► Continue to invest in and improve comme
Slide 14: United Acquisition of MoneyTree Corporation / FNB
United Acquisition of MoneyTree Corporation / FNB Date Closed: May 1, 2015 Pricing Summary Aggregate Deal Value: $52 million merged with Price Per Share: $63.59 Price / 2014 EPS: 19.9x Price / TBV: 1.4x Consideration Mix: 80% Stock (2.359M issued) 20% Cash ($10.7M) January 27, 2015 MoneyTree Corpora
Slide 15: United Acquisition of Palmetto Bancshares
United Acquisition of Palmetto Bancshares $ in Thousands Date Closed: September 1, 2015 Pricing Summary Aggregate Deal Value: $241 million has agreed to merge with Price Per Share: $18.53 Price / 2016 EPS: 19.5x Price / TBV: 1.8x Consideration Mix: 70% Stock (8.701M shares to be issued) April 22, 20
Slide 16: Non-GAAP Reconciliation Tables
Non-GAAP Reconciliation Tables $ in Thousands 3Q15 2Q15 1Q15 4Q14 3Q14 CORE FEE REVENUE Core fee revenue $ 18,448 $ 17,220 $ 15,120 $ 14,553 $ 14,419 Securities gains, net 325 13 1,539 208 11 Losses on prepayment of borrowings (256) - (1,038) - - Mark to market on deferred compensation plan assets (
Slide 17: Non-GAAP Reconciliation Tables
Non-GAAP Reconciliation Tables $ in Thousands 3Q15 2Q15 1Q15 4Q14 3Q14 RETURN ON ASSETS Operating return on assets 1.00 % 1.00 % .94 % .96 % .95 % Merger-related charges (.18) (.11) - - - Return on Assets (GAAP) .82 % .89 % .94 % .96 % .95 % RETURN ON COMMON EQUITY Operating return on common equity
Slide 18: Third Quarter 2015 Exhibits
UNITED COMMUNITY BANKS, INC. THIRD QUARTER 2015 EXHIBITS October 27, 2015 ucbi.com | 18 ucbi.com | 18
Slide 19: Current Footprint
Current Footprint Key Statistics as of 9/30/15 ► Headquartered in Blairsville, Georgia ► Four state regional community bank: GA, NC, SC and TN ► 133 Locations ► Founded in 1950 ► Largest community bank headquartered in Georgia and one of the largest in the Southeast ► 1,927 employees ► $9.4 billion
Slide 20: Business and Operating Model
Business and Operating Model SERVICE IS POINT OF DIFFERENTIATION ► #1 in customer satisfaction according to customer service profiles ► #1 in Southeast and #2 in US in customer satisfaction by national research company ► Golden rule of banking – treating people the way we want to be treated ► “The B
Slide 21: Experienced Proven Leadership
Experienced Proven Leadership • Over 40 years in banking • Over 30 years in banking • Over 35 years in banking • Led company from $42 • Responsible for overall • Responsible for million in assets in 1989 to banking, credit and accounting, finance and $9.4 billion today operations reporting activitie
Slide 22: Market Share Opportunities
Market Share Opportunities EXCELLENT GROWTH OPPORTUNITIES Market United Deposits Deposits Deposit Markets (in billions) (1) (in billions) (2) Banks (3) Offices Share (1) Rank(1) North Georgia $ 6.6 $ 2.3 9 20 37 % 1 Atlanta, Georgia 60.8 2.4 10 38 4 6 Gainesville, Georgia 3.0 .4 1 5 12 4 Coastal Geo
Slide 23: Market Share Demographics
Market Share Demographics Key MSA Growth Markets Projected Change 2016 - 2021 Savannah, GA 6.91% Gainesville, GA 6.49% Atlanta, GA 6.38% Greenville, SC 5.70% Asheville, NC 4.96% Cleveland, TN 4.23% Knoxville, TN 3.35% 0% 1% 2% 3% 4% 5% 6% 7% 8% STATE POPULATION GROWTH Projected Change 2016 – 2021 So
Slide 24: Liquidity
Liquidity $ in Millions Capacity 3Q15 2Q15 3Q14 vs 2Q15 vs 3Q14 WHOLESALE BORROWINGS (1) Brokered Deposits $ 425 $ 517 $ 530 $ 405 $ (13) $ 112 FHLB 644 200 385 330 (185) (130) Holding Company LOC 50 - - - - - Wholesale Fed Funds 510 5 25 - (20) 5 Borrowings Other Wholesale - 14 - 6 14 8 Total $ 1,6
Slide 25: Lending & Credit Environment
Lending & Credit Environment $ in Millions Regional Credit Review – Standard Underwriting •Legal Lending Limit $ 197 • Centralized underwriting and approval process •House Lending Limit 25 • Segregated work-out teams • Highly skilled ORE disposition group •Project Lending Limit 15 • Seasoned regiona
Slide 26: Performing Classified Loans
Performing Classified Loans $ in Millions $150 $149.0 $130 $128.4 $129.9 $121.7 $115.7 $110 3Q14 4Q14 1Q15 2Q15 3Q15 By Category 3Q14 4Q14 1Q15 2Q15 3Q15 Commercial: Commercial & Industrial $ 7 $ 8 $ 7 $ 6 $ 6 Owner Occupied 50 46 44 40 39 Total C & I 57 54 51 46 45 Income Producing CRE 22 20 20 19
Slide 27: TDRs
TDRs $ in Millions LOAN TYPE Accruing Non-Accruing Total TDRs 3Q15(1) 3Q14 3Q15 3Q14 3Q15(1) 3Q14 Owner-Occupied Commercial Real Estate $ 31.6 $ 25.2 $ 1.2 $ 1.1 $ 32.8 $ 26.3 Income-Producing Commercial Real Estate 14.1 17.6 .3 1.5 14.4 19.1 Commercial & Industrial 3.5 2.9 - - 3.5 2.9 Commercial Co
Slide 28: Lending & Credit Environment
Lending & Credit Environment $ in Millions Amount Percent Owner Income Multi-Residential $ 76 23.8 % Occupied Producing Total Percent Land Develop - Vacant (Improved) 55 17.2 Office Buildings $ 375 $ 193 $ 568 24.7 % Commercial Land Development 28 8.8 Retail Building 130 212 342 14.9 Raw Land - Vaca
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