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8-K - FORM 8-K - PACIFIC CONTINENTAL CORPd277841d8k.htm

Exhibit 99.1

NEWS RELEASE

 

FOR MORE INFORMATION CONTACT:    Michael Dunne
   Public Information Officer
   541-338-1428
   www.therightbank.com
   Email: michael.dunne@therightbank.com

FOR IMMEDIATE RELEASE

Pacific Continental Corporation Reports Third Quarter Results

Balance sheet expansion driven by both organic growth and acquisition

EUGENE, Ore., October 26, 2016 – Pacific Continental Corporation (Nasdaq: PCBK), the holding company of Pacific Continental Bank, today reported financial results for the third quarter ended September 30, 2016.

Third Quarter Highlights:

 

    On September 6, 2016, completed the acquisition of Foundation Bank, a business bank located in Bellevue, WA with approximately $450.0 million in assets at closing. Successful core systems integration completed on October 10, 2016.

 

    Quarterly organic loan growth of $52.1 million.

 

    Quarterly organic core deposit growth of $144.8 million.

 

    Net income of $4.9 million, or $0.23 per diluted share.

 

    Tax-equivalent net interest margin of 4.22%.

 

    Paid third quarter 2016 regular quarterly cash dividend of $0.11 per share.

 

    Recognized by Portland Business Journal with the Healthiest Companies Award.

 

    Recognized by 425 Business Magazine with the 30-Under-30 Award.

Net Income Highlights

Net income for the third quarter 2016 was $4.9 million, or $0.23 per diluted share, and included non-core costs associated with our acquisition of Foundation Bank, which were approximately $1.8 million, or approximately $0.06 per diluted share. Also included in third quarter results was $589 thousand, or $0.03 per diluted share, of net income related to the Foundation Bank operations from the time of transaction closing on September 6, 2016. The provision for loan losses expense in the third quarter was $1.4 million, compared to $2.0 million for the second quarter.

Annualized returns on average assets, average equity and average tangible equity for third quarter 2016 were 0.89%, 8.05%, and 10.14%, respectively, compared to 0.53%, 4.67%, and 5.80% for second quarter 2016. Annualized returns on average assets, average equity, and average tangible equity for the nine months ended September 30, 2016 were 0.85%, 7.55%, and 9.43%, respectively, compared to 1.01%, 8.60%, and 10.62% for the same time period in 2015.

“This was a milestone quarter, as we successfully completed the acquisition and integration of Foundation Bank, which has significantly increased our presence and market share in the vibrant Puget Sound region,” said Roger Busse, chief executive officer. “We are proud of our management teams and leadership across all regions, as we continued to drive solid organic growth and earnings.”

Third quarter 2016 noninterest income was $1.9 million, an increase of $172 thousand from the second quarter 2016. Approximately $55 thousand of the increase related to operating income from Foundation Bank while the remainder was due to a one-time payment of $160 thousand received from the Small Business Administration, related to expense reimbursement incurred by a previously acquired bank. There were no gains on sales of securities during the third quarter, compared to $71 thousand during the second quarter.


Noninterest expense for the third quarter 2016 was $13.8 million, this represented a decrease of $1.1 million from the second quarter of 2016, with $556 thousand of the savings resulting from decreased reserving related to our partially self-funded health insurance plan, and $571 thousand resulting from decreased legal and professional expenses. During the second quarter we recorded $550 thousand of additional reserve expense related to higher than forecasted claim activity in our partially self-funded health insurance plan. Claim activity returned to more normal levels for the third quarter. The decrease in legal and professional expenses related to the annual director’s equity grant of $240 thousand that occurred during the second quarter and lower legal bills related to other projects.

Net Interest Margin

The third quarter 2016 net interest margin was 4.22%, a decrease of 5 basis points from the second quarter net interest margin. As we stated during our second quarter earnings call, we anticipated some margin compression during the third quarter and going forward, due primarily to the increased interest expense from our subordinated notes offering in the second quarter 2016. The impact of the interest expense associated with the subordinated debt was approximately 11 basis points during the third quarter. Accretion income for the third quarter 2016 was $877 thousand compared to $156 thousand for the second quarter 2016. As outlined below, the core margin was 3.99% for the third quarter 2016 compared to 4.20% for the second quarter 2016.

 

     Dollars in thousands  
     Third Quarter 2016     Second Quarter 2016  
     Average
Balance
     Income
(Expense)
    Yield     Average
Balance
     Income
(Expense)
    Yield  

Federal funds sold and interest-bearing deposits

   $ 28,811       $ 40        0.55   $ 15,597       $ 19        0.49

Federal Home Loan Bank stock

     6,975         46        2.62     7,004         20        1.15

Securities available-for-sale (1)

     421,085         2,691        2.54     385,777         2,550        2.66

Net loans (2)

     1,558,018         19,315        4.93     1,444,956         17,891        4.98
  

 

 

    

 

 

     

 

 

    

 

 

   

Earning assets

     2,014,889         22,092        4.36     1,853,334         20,480        4.44

Interest bearing liabilities

     1,230,806         (1,891     -0.61     1,121,088         (1,137     -0.41

Core margin (non-GAAP)

     2,014,889         20,201        3.99     1,853,334         19,343        4.20

Acquired loan accretion

        877        0.17        156        0.03

Prepayment penalties on loans

        276        0.05        166        0.04
  

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

 

Net interest margin

   $ 2,014,889       $ 21,354        4.22   $ 1,853,334       $ 19,665        4.27
  

 

 

    

 

 

   

 

 

   

 

 

    

 

 

   

 

 

 

 

(1)  Tax-exempt security income has been adjusted to a tax-equivalent basis at a 35% tax rate. The amount of such adjustment was an addition to recorded income of approximately $260 and $256 for the three months ended September 30, 2016 and June 30, 2016, respectively. Net interest margin was positively impacted by 5 and 6 basis points, respectively, in these periods.
(2) Tax-exempt loan income has been adjusted to a tax-equivalent basis at a 35% tax rate. The amount of such adjustment was an addition to recorded income of approximately $323 and $262 for the three months ended September 30, 2016 and June 30, 2016, respectively. Net interest margin was positively impacted by 6 basis points in each period.

Balance Sheet Highlights

Gross loans grew by $322.5 million in third quarter 2016, and totaled $1.81 billion at September 30, 2016. Included in the loan growth was $270.5 million of loans acquired in the Foundation Bank transaction. Organic loan growth was $52.1 million for the third quarter. Gross loan growth through the first nine months of 2016 was $402.6 million. Excluding the $270.5 million in acquired loans, our organic loan growth was $132.1 million, or 12.55% annualized. At September 30, 2016, loans to dental practitioners totaled $370.1 million and represented 20.46% of the loan portfolio. This represented an increase of $325 thousand over second quarter 2016, where loans to dental practitioners represented 24.88% of the loan portfolio.

Period-end Company-defined core deposits at September 30, 2016, were $2.05 billion, an increase of $541.3 million from the second quarter 2016. Included in the core deposit growth was $396.5 million of deposits acquired in the Foundation Bank transaction. Organic core deposit growth was $144.8 million for the third quarter, with $84.3 million, or 58.22%, of our growth coming from the large depositor portfolio. The increase from the large depositor portfolio was led by one client that increased its deposits by $64.3 million during the quarter. The increase was the result of a business sale and we anticipate that the majority of these funds will leave the Bank during the fourth quarter. Core deposit growth through the first nine months of 2016 was $515.4 million. Excluding the $396.5 million in acquired deposits, our organic core deposit growth was $118.9 million, or 10.35% annualized.


“We are proud of our outstanding team of bankers and they continue to produce solid organic loan growth”, said Casey Hogan, chief operating officer. “Our organic core deposit growth was outstanding in the third quarter and we are pleased that more than 40% of the growth came in our small depositor portfolio.”

Asset Quality

As of September 30, 2016, the allowance for loan losses as a percentage of outstanding loans was 1.14%, a decrease from the 1.29% reported at June 30, 2016. The decrease was largely the result of the Foundation Bank acquired loans included at their fair value, net of any credit risk adjustments. At September 30, 2016, the allowance for loan losses as a percentage of nonperforming loans, net of government guarantees, decreased to 210.23% from 1,172.72% at June 30, 2016. During the third quarter 2016, the Company recorded net recoveries of $24 thousand, compared to net loan losses of $419 thousand during the second quarter 2016. During the third quarter, the Company made a $1.4 million provision for loan losses compared to $2.0 million in the second quarter 2016.

At September 30, 2016, nonperforming assets, net of government guarantees, totaled $22.8 million, or 0.90% of total assets, compared to $13.7 million, or 0.68% of total assets, at June 30, 2016. The increase primarily related to loans and other real estate owned acquired in the Foundation Bank transaction. Nonperforming assets at September 30, 2016, were comprised of $9.8 million of nonperforming loans, net of government guarantees of $2.4 million, and $13.1 million in other real estate owned. Loans past-due 30-89 days were 0.01% of total loans at September 30, 2016, compared to 0.02% of total loans at June 30, 2016.

Capital Adequacy

The Company’s consolidated capital ratios continued to be above the minimum thresholds for the FDIC’s “well-capitalized” designation. At September 30, 2016, the Company’s capital ratios were as follows:

 

     September 30, 2016  

Minimum dollar requirements

   Pacific
Continental
Corporation
    Regulatory
Minimum (Well-
Capitalized)
    Excess  

Tier I capital (to leverage assets)

   $ 215,471      $ 104,329      $ 111,142   

Common equity tier 1 capital (to risk weighted assets)

   $ 203,359      $ 140,135      $ 63,224   

Tier I capital (to risk weighted assets)

   $ 215,471      $ 172,474      $ 42,997   

Total capital (to risk weighted assets)

   $ 270,622      $ 215,593      $ 55,029   

Minimum percentage requirements

   Pacific
Continental
Corporation
    Regulatory
Minimum (Well-
Capitalized)
       

Tier I capital (to leverage assets)

     10.33     5.00  

Common equity tier 1 capital (to risk weighted assets)

     9.43     6.50  

Tier I capital (to risk weighted assets)

     9.99     8.00  

Total capital (to risk weighted assets)

     12.55     10.00  

Non-GAAP Financial Measures

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

Certain Financial measures such as tangible shareholders’ equity, and tangible assets, are considered non-GAAP measures. Management believes including non-GAAP measures along with GAAP measures provides investors with a broader understanding of capital adequacy, funding sources and revenue trends. Tangible shareholders’ equity is calculated as total shareholders’ equity less goodwill and core deposit intangible assets. Additionally, tangible assets are calculated as total assets less goodwill and core deposit intangible assets.


The following table presents a reconciliation of ending total shareholders’ equity (GAAP) to ending tangible shareholders’ equity (non-GAAP), and total assets (GAAP) to total tangible assets (non-GAAP):

 

     September 30,      June 30,      September 30,  
     2016      2016      2015  
     (In thousands)  

Total shareholders’ equity

   $ 276,471       $ 226,426       $ 216,676   

Subtract:

        

Goodwill

     61,436         40,027         39,075   

Core deposit intangible assets

     9,248         3,657         4,027   
  

 

 

    

 

 

    

 

 

 

Tangible shareholders’ equity (non-GAAP)

   $ 205,787       $ 182,742       $ 173,574   
  

 

 

    

 

 

    

 

 

 

Total assets

   $ 2,539,060       $ 2,025,410       $ 1,878,283   

Subtract:

        

Goodwill

     61,436         40,027         39,074   

Core deposit intangible assets

     9,248         3,657         4,028   
  

 

 

    

 

 

    

 

 

 

Total tangible assets (non-GAAP)

   $ 2,468,376       $ 1,981,726       $ 1,835,181   
  

 

 

    

 

 

    

 

 

 

Conference Call and Audio Webcast

Management will conduct a live conference call and audio webcast for interested parties relating to the Company’s results for the third quarter 2016 on Thursday, October 27, 2016, at 11:00 a.m. Pacific / 2:00 p.m. Eastern. To listen to the conference call, interested parties should call: (855) 215-7498 Passcode: 1554389. Following the formal remarks, a question and answer session will be open to all interested parties. The webcast will be available via Pacific Continental’s website www.therightbank.com. To listen to the live audio webcast, click on the webcast presentation link on the Company’s home page a few minutes before the presentation is scheduled to begin. An audio webcast replay is typically available within twenty-four hours following the live webcast and will be archived for one year on the Pacific Continental website. Any questions regarding the conference call presentation or webcast should be directed to Shannon Coffin, executive administrative assistant, at 541-686-8685.

About Pacific Continental Bank

Pacific Continental Bank, the wholly-owned operating subsidiary of Pacific Continental Corporation, delivers highly personalized services through fifteen banking offices in Oregon and Washington. The Bank also operates loan production offices in Tacoma, Washington and Denver, Colorado. Pacific Continental, with slightly more than $2.5 billion in assets, has established one of the most unique and attractive metropolitan branch networks in the Pacific Northwest with offices in three of the region’s largest markets, including Seattle, Portland and Eugene. Pacific Continental targets the banking needs of community-based businesses, health care professionals, professional service providers and nonprofit organizations.

Since its founding in 1972, Pacific Continental Bank has been honored with numerous awards and recognitions from highly regarded third-party organizations including The Seattle Times, the Portland Business Journal, the Seattle Business magazine and Oregon Business magazine. A complete list of the company’s awards and recognitions – as well as supplementary information about Pacific Continental Bank – can be found online at www.therightbank.com. Pacific Continental Corporation’s shares are listed on the Nasdaq Global Select Market under the symbol “PCBK” and are a component of the Russell 2000 Index.

Forward-Looking Statement Safe Harbor

This release contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (“PSLRA”). These statements can be identified by the fact that they do not relate strictly to historical or current facts. Forward-looking statements often use words such as “anticipates,” “targets,” “expects,” “estimates,” “intends,” “plans,” “goals,” “believes” and other similar expressions or future or conditional verbs such as “will,” “should,” “would” and “could.” The forward-looking statements made represent Pacific Continental’s current estimates, projections, expectations, plans or forecasts of its future results and revenues, including but not limited to statements about performance, loan or deposit growth, net interest margin compression, strategic focus, capital position, liquidity, credit quality, credit quality trends, and the impact and effects of recent or pending acquisitions. These statements are not guarantees of future results or performance and involve certain risks, uncertainties and assumptions that are difficult to predict and are often beyond Pacific Continental’s control. Actual outcomes and results may differ materially from those expressed in, or implied by, any of these forward-looking statements. You should not place undue reliance on any forward-looking statement and should consider all of the following uncertainties and risks, as well as those more fully discussed under “Risk Factors”, “Business”, and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Pacific Continental’s most recent Annual Report on Form 10-K, Quarterly


Report on Form 10-Q, and in any of Pacific Continental’s subsequent SEC filings, including the high concentration of loans of the Company’s banking subsidiary in commercial and residential real estate lending and in loans to dental professionals; adverse economic trends in the United States and the markets we serve affecting the Bank’s borrower base; continued erosion or sustained low levels of consumer confidence; changes in the Federal Reserve’s monetary policies and the regulatory environment and increases in associated costs, particularly ongoing compliance expenses and resource allocation needs; vendor quality and efficiency; the Company’s ability to control risks associated with rapidly changing technology both from an internal perspective as well as for external providers; operational systems or infrastructure failures; increased competition; fluctuating interest rates; a tightening of available credit; the potential adverse impact of legal or regulatory proceedings; and risks related to acquisitions, including integration, retention of key personnel and business, anticipated cost savings and results and performance of the acquired company or the combined entity. Pacific Continental Corporation undertakes no obligation to publicly revise or update any forward-looking statement to reflect the impact of events or circumstances that arise after the date of this release. This statement is included for the express purpose of invoking the PSLRA’s safe harbor provisions.


PACIFIC CONTINENTAL CORPORATION and subsidiary

Consolidated Income Statements

(Dollars in thousands, except share and per share amounts)

(Unaudited)

 

     Three months ended     Linked     Year over  
     September 30,     June 30,     September 30,     Quarter     Year  
     2016     2016     2015     % Change     % Change  

Interest and dividend income

          

Loans

   $ 20,145      $ 17,951      $ 17,240        12.22     16.85

Taxable securities

     1,995        1,838        1,713        8.54     16.46

Tax-exempt securities

     482        476        490        1.26     -1.63

Federal funds sold and interest-bearing deposits with banks

     40        19        7        110.53     471.43
  

 

 

   

 

 

   

 

 

     
     22,662        20,284        19,450        11.72     16.51
  

 

 

   

 

 

   

 

 

     

Interest expense

          

Deposits

     984        797        854        23.46     15.22

Federal Home Loan Bank & Federal Reserve borrowings

     286        282        227        1.42     25.99

Subordinated debentures

     553        —          —          NA        NA   

Junior subordinated debentures

     66        56        57        17.86     15.79

Federal funds purchased

     2        2        4        0.00     -50.00
  

 

 

   

 

 

   

 

 

     
     1,891        1,137        1,142        66.31     65.59
  

 

 

   

 

 

   

 

 

     

Net interest income

     20,771        19,147        18,308        8.48     13.45

Provision for loan losses

     1,380        1,950        625        -29.23     120.80
  

 

 

   

 

 

   

 

 

     

Net interest income after provision for loan losses

     19,391        17,197        17,683        12.76     9.66
  

 

 

   

 

 

   

 

 

     

Noninterest income

          

Service charges on deposit accounts

     717        688        703        4.22     1.99

Bankcard income

     314        294        276        6.80     13.77

Bank-owned life insurance income

     172        145        156        18.62     10.26

Gain on sale of investment securities

     —          71        143        -100.00     -100.00

Impairment losses on investment securities (OTTI)

     (2     —          —          NA        NA   

Other noninterest income

     718        549        436        30.78     64.68
  

 

 

   

 

 

   

 

 

     
     1,919        1,747        1,714        9.85     11.96
  

 

 

   

 

 

   

 

 

     

Noninterest expense

          

Salaries and employee benefits

     7,520        8,005        6,822        -6.06     10.23

Premises and equipment

     1,202        1,087        1,148        10.58     4.70

Data processing

     924        893        838        3.47     10.26

Legal and professional fees

     569        1,140        496        -50.09     14.72

Business development

     460        516        369        -10.85     24.66

FDIC insurance assessment

     273        286        283        -4.55     -3.53

Other real estate expense (income), net

     71        (113     122        -162.83     -41.80

Merger related expenses (1)

     1,767        1,978        —          -10.67     NA   

Other noninterest expense

     1,039        1,140        1,104        -8.86     -5.89
  

 

 

   

 

 

   

 

 

     
     13,825        14,932        11,182        -7.41     23.64
  

 

 

   

 

 

   

 

 

     

Income before provision for income taxes

     7,485        4,012        8,215        86.57     -8.89

Provision for income taxes

     2,634        1,406        2,890        87.34     -8.86
  

 

 

   

 

 

   

 

 

     

Net income

   $ 4,851      $ 2,606      $ 5,325        86.15     -8.90
  

 

 

   

 

 

   

 

 

     

Earnings per share:

          

Basic

   $ 0.24      $ 0.13      $ 0.27        84.62     -11.11
  

 

 

   

 

 

   

 

 

     

Diluted

   $ 0.23      $ 0.13      $ 0.27        76.92     -14.81
  

 

 

   

 

 

   

 

 

     

Weighted average shares outstanding:

          

Basic

     20,511,392        19,697,314        19,591,666       

Common stock equivalents attributable to stock-based awards

     165,572        171,653        225,104       
  

 

 

   

 

 

   

 

 

     

Diluted

     20,676,964        19,868,967        19,816,770       
  

 

 

   

 

 

   

 

 

     

PERFORMANCE RATIOS

          

Return on average assets

     0.89     0.53     1.14    

Return on average equity (book)

     8.05     4.67     9.91    

Return on average equity (tangible) (2)

     10.14     5.80     12.42    

Net interest margin - fully tax-equivalent yield (3)

     4.22     4.27     4.32    

Efficiency ratio (4)

     60.24     70.60     55.12    

 

(1) Represents expenses associated with the acquisition of Foundation Bank.
(2) Tangible equity excludes goodwill and core deposit intangible assets related to acquisitions.
(3) Net interest margin is reported on a tax-equivalent yield basis at a 35% tax rate.
(4)  Efficiency ratio is noninterest expense as a percent of net interest income (on a tax-equivalent basis) plus noninterest income.

NA Not applicable


PACIFIC CONTINENTAL CORPORATION and subsidiary

Year-to-Date Consolidated Income Statements

(Dollars in thousands, except share and per share amounts)

(Unaudited)

 

     Nine months ended     Year over  
     September 30,     Year  
     2016     2015     % Change  

Interest and dividend income

      

Loans

   $ 55,810      $ 48,020        16.22

Taxable securities

     5,551        4,825        15.05

Tax-exempt securities

     1,435        1,491        -3.76

Federal funds sold and interest-bearing deposits with banks

     104        23        352.17
  

 

 

   

 

 

   
     62,900        54,359        15.71
  

 

 

   

 

 

   

Interest expense

      

Deposits

     2,678        2,509        6.74

Federal Home Loan Bank and Federal Reserve borrowings

     758        694        9.22

Subordinated debentures

     553        —          NA   

Junior subordinated debentures

     179        169        5.92

Federal funds purchased

     6        10        -40.00
  

 

 

   

 

 

   
     4,174        3,382        23.42
  

 

 

   

 

 

   

Net interest income

     58,726        50,977        15.20

Provision for loan losses

     3,575        1,175        204.26
  

 

 

   

 

 

   

Net interest income after provision for loan losses

     55,151        49,802        10.74
  

 

 

   

 

 

   

Noninterest income

      

Service charges on deposit accounts

     2,099        1,939        8.25

Bankcard income

     899        687        30.86

Bank-owned life insurance income

     463        435        6.44

Gain on sale of investment securities

     309        336        -8.04

Impairment losses on investment securities (OTTI)

     (19     (13     46.15

Other noninterest income

     1,726        1,234        39.87
  

 

 

   

 

 

   
     5,477        4,618        18.60
  

 

 

   

 

 

   

Noninterest expense

      

Salaries and employee benefits

     23,084        20,223        14.15

Premises and equipment

     3,404        3,221        5.68

Data processing

     2,682        2,343        14.47

Legal and professional fees

     2,321        1,386        67.46

Business development

     1,492        1,134        31.57

FDIC insurance assessment

     848        769        10.27

Other real estate (income) expense, net

     (32     303        -110.56

Merger related expense (1)

     3,745        1,836        103.98

Other noninterest expense

     3,222        2,971        8.45
  

 

 

   

 

 

   
     40,766        34,186        19.25
  

 

 

   

 

 

   

Income before provision for income taxes

     19,862        20,234        -1.84

Provision for income taxes

     6,946        7,012        -0.94
  

 

 

   

 

 

   

Net income

   $ 12,916      $ 13,222        -2.31
  

 

 

   

 

 

   

Earnings per share:

      

Basic

   $ 0.65      $ 0.69        -5.80
  

 

 

   

 

 

   

Diluted

   $ 0.64      $ 0.68        -5.88
  

 

 

   

 

 

   

Weighted average shares outstanding:

      

Basic

     19,940,709        19,133,682     

Common stock equivalents attributable to stock-based awards

     154,813        224,308     
  

 

 

   

 

 

   

Diluted

     20,095,522        19,357,990     
  

 

 

   

 

 

   

PERFORMANCE RATIOS

      

Return on average assets

     0.85     1.01  

Return on average equity (book)

     7.55     8.60  

Return on average equity (tangible) (2)

     9.43     10.62  

Net interest margin - fully tax-equivalent yield (3)

     4.25     4.34  

Efficiency ratio (4)

     62.74     60.62  

 

(1) Represents expenses associated with the acquisition of Foundation Bank during 2016 and the acquisition of Capital Pacific Bank, completed 2015.
(2) Tangible equity excludes goodwill and core deposit intangible assets related to acquisitions.
(3) Net interest margin is reported on a tax-equivalent yield basis at a 35% tax rate.
(4)  Efficiency ratio is noninterest expense as a percent of net interest income (on a tax-equivalent basis) plus noninterest income.


PACIFIC CONTINENTAL CORPORATION and subsidiary

Consolidated Balance Sheets

(Dollars in thousands, except share and per share amounts)

(Unaudited)

 

                       Linked     Year over  
     September 30,     June 30,     September 30,     Quarter     Year  
     2016     2016     2015     % Change     % Change  

ASSETS

          

Cash and due from banks

   $ 35,819      $ 25,238      $ 21,698        41.92     65.08

Interest-bearing deposits with banks

     71,353        18,151        11,293        293.11     531.83
  

 

 

   

 

 

   

 

 

     

Total cash and cash equivalents

     107,172        43,389        32,991        147.00     224.85

Securities available-for-sale

     482,408        396,230        387,073        21.75     24.63

Loans, net of deferred fees

     1,806,736        1,484,152        1,355,807        21.74     33.26

Allowance for loan losses

     (20,531     (19,127     (16,612     7.34     23.59
  

 

 

   

 

 

   

 

 

     

Net Loans

     1,786,205        1,465,025        1,339,195       

Interest receivable

     5,957        6,334        5,688        -5.95     4.73

Federal Home Loan Bank stock

     4,643        8,351        6,768        -44.40     -31.40

Property and equipment, net of accumulated depreciation

     19,656        19,086        17,708        2.99     11.00

Goodwill and intangible assets, net

     70,684        43,684        43,102        61.81     63.99

Deferred tax asset

     7,380        2,797        5,319        163.85     38.75

Other real estate owned

     13,066        12,108        11,854        7.91     10.22

Bank-owned life insurance

     34,927        23,174        22,727        50.72     53.68

Other assets

     6,962        5,232        5,858        33.07     18.85
  

 

 

   

 

 

   

 

 

     

Total assets

   $ 2,539,060      $ 2,025,410      $ 1,878,283        25.36     35.18
  

 

 

   

 

 

   

 

 

     

LIABILITIES AND SHAREHOLDERS’ EQUITY

          

Deposits

          

Noninterest-bearing demand

   $ 901,290      $ 624,146      $ 544,009        44.40     65.68

Savings and interest-bearing checking

     1,082,202        826,854        831,933        30.88     30.08

Core time deposits

     65,860        57,019        89,605        15.51     -26.50
  

 

 

   

 

 

   

 

 

     

Total core deposits (2)

     2,049,352        1,508,019        1,465,547        35.90     39.84

Non-core time deposits

     113,281        92,113        59,407        22.98     90.69
  

 

 

   

 

 

   

 

 

     

Total deposits

     2,162,633        1,600,132        1,524,954        35.15     41.82

Securities sold under agreements to repurchase

     1,107        1,029        302        7.58     266.56

Federal funds and overnight funds purchased

     —          —          5,000        NA        -100.00

Federal Home Loan Bank borrowings

     45,500        151,500        116,500        -69.97     -60.94

Subordinated debentures

     34,072        34,092        —          -0.06     NA   

Junior subordinated debentures

     11,272        8,248        8,248        36.66     36.66

Accrued interest and other payables

     8,005        3,983        6,603        100.98     21.23
  

 

 

   

 

 

   

 

 

     

Total liabilities

     2,262,589        1,798,984        1,661,607        25.77     36.17
  

 

 

   

 

 

   

 

 

     

Shareholders’ equity

          

Common stock: 50,000,000 shares authorized. Shares issued and outstanding: 22,603,421 at September 30, 2016, 19,731,925 at June 30, 2016 and 19,591,703 at September 30, 2015

     205,120        156,678        155,695        30.92     31.74

Retained earnings

     66,112        63,431        56,320        4.23     17.39

Accumulated other comprehensive income

     5,239        6,317        4,661        -17.07     12.40
  

 

 

   

 

 

   

 

 

     
     276,471        226,426        216,676        22.10     27.60
  

 

 

   

 

 

   

 

 

     

Total liabilities and shareholders’ equity

   $ 2,539,060      $ 2,025,410      $ 1,878,283        25.36     35.18
  

 

 

   

 

 

   

 

 

     

CAPITAL RATIOS

          

Total capital (to risk weighted assets)

     12.55     13.54     12.58    

Tier I capital (to risk weighted assets)

     9.99     10.52     11.49    

Common equity tier 1 capital (to risk weighted assets)

     9.43     10.07     11.00    

Tier I capital (to leverage assets)

     10.33     9.62     9.88    

Tangible common equity (to tangible assets)(1)

     8.34     9.22     9.46    

Tangible common equity (to risk-weighted assets)(1)

     9.55     10.30     11.08    

OTHER FINANCIAL DATA

          

Shares outstanding at end of period

     22,603,421        19,731,925        19,591,703       

Tangible shareholders’ equity(1)

   $ 205,787      $ 182,742      $ 173,574       

Book value per share

   $ 12.23      $ 11.48      $ 11.06       

Tangible book value per share

   $ 9.10      $ 9.26      $ 8.86       

 

(1)  Tangible common equity excludes goodwill and core deposit intangible assets related to acquisitions.
(2)  Core deposits include demand, interest checking, money market, savings, and local time deposits, including local nonpublic time deposits in excess of $100.

NA Not applicable


PACIFIC CONTINENTAL CORPORATION and subsidiary

Loans by Type

(Dollars in thousands)

(Unaudited)

 

                       Linked     Year over  
     September 30,     June 30,     September 30,     Quarter     Year  
     2016     2016     2015     % Change     % Change  

LOANS BY TYPE

          

Real estate secured loans:

          

Permanent loans:

          

Multi-family residential

   $ 79,126      $ 66,403      $ 64,083        19.16     23.47

Residential 1-4 family

     61,498        51,652        58,313        19.06     5.46

Owner-occupied commercial

     425,879        375,911        353,255        13.29     20.56

Nonowner-occupied commercial

     431,119        339,444        288,539        27.01     49.41
  

 

 

   

 

 

   

 

 

     

Total permanent real estate loans

     997,622        833,410        764,190        19.70     30.55

Construction loans:

          

Multi-family residential

     24,567        16,743        9,340        46.73     163.03

Residential 1-4 family

     42,130        34,372        30,834        22.57     36.63

Commercial real estate

     78,369        57,790        39,259        35.61     99.62

Commercial bare land and acquisition and development

     19,050        10,551        16,947        80.55     12.41

Residential bare land and acquisition and development

     8,852        6,658        7,602        32.95     16.44
  

 

 

   

 

 

   

 

 

     

Total construction real estate loans

     172,968        126,114        103,982        37.15     66.34
  

 

 

   

 

 

   

 

 

     

Total real estate loans

     1,170,590        959,524        868,172        22.00     34.83

Commercial loans

     630,091        518,529        479,018        21.52     31.54

Consumer loans

     3,201        3,313        3,575        -3.38     -10.46

Other loans

     4,764        4,737        6,280        0.57     -24.14
  

 

 

   

 

 

   

 

 

     

Gross loans

     1,808,646        1,486,103        1,357,045        21.70     33.28

Deferred loan origination fees

     (1,910     (1,951     (1,238     -2.10     54.28
  

 

 

   

 

 

   

 

 

     
     1,806,736        1,484,152        1,355,807        21.74     33.26

Allowance for loan losses

     (20,531     (19,127     (16,612     7.34     23.59
  

 

 

   

 

 

   

 

 

     
   $ 1,786,205      $ 1,465,025      $ 1,339,195        21.92     33.38
  

 

 

   

 

 

   

 

 

     

SELECTED MARKET LOAN DATA

          

Eugene market gross loans, period-end

   $ 404,858      $ 396,260      $ 368,666        2.17     9.82

Portland market gross loans, period-end

     728,749        697,664        647,527        4.46     12.54

Seattle market gross loans, period-end

     423,581        141,788        137,830        198.74     207.32

National health care gross loans, period-end (1)

     251,458        250,391        203,022        0.43     23.86
  

 

 

   

 

 

   

 

 

     

Total gross loans, period-end

   $ 1,808,646      $ 1,486,103      $ 1,357,045        21.70     33.28
  

 

 

   

 

 

   

 

 

     

DENTAL LOAN DATA (2)

          

Local dental gross loans, period-end

   $ 150,898      $ 152,109      $ 155,137        -0.80     -2.73

National dental gross loans, period-end

     219,237        217,701        185,161        0.71     18.40
  

 

 

   

 

 

   

 

 

     

Total gross dental loans, period-end

   $ 370,135      $ 369,810      $ 340,298        0.09     8.77
  

 

 

   

 

 

   

 

 

     

 

(1) National health care loans include loans to health care professionals, including dental and veterinary practitioners, operating outside of Pacific Continental Bank’s market area. The market area is defined as Oregon and Washington, west of the Cascade Mountain Range.
(2)  Dental loans include loans to dental professionals for the purpose of practice expansion, acquisition or other purpose, supported by the cash flows of a dental practice.


PACIFIC CONTINENTAL CORPORATION and subsidiary

Selected Other Financial Information and Ratios

(Dollars in thousands)

(Unaudited)

 

     Three months ended     Nine months ended  
     September 30,     June 30,     September 30,     September 30,     September 30,  
     2016     2016     2015     2016     2015  

BALANCE SHEET AVERAGES

          

Loans, net of deferred fees

   $ 1,577,365      $ 1,463,112      $ 1,335,897      $ 1,487,349      $ 1,235,031   

Allowance for loan losses

     (19,347     (18,156     (16,275     (18,327     (15,913
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Loans, net of allowance

     1,558,018        1,444,956        1,319,622        1,469,022        1,219,118   

Securities, short-term deposits and FHLB stock

     456,871        408,378        406,579        427,937        398,978   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Earning assets

     2,014,889        1,853,334        1,726,201        1,896,959        1,618,096   

Noninterest-earning assets

     149,098        135,651        133,217        139,968        127,521   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Assets

   $ 2,163,987      $ 1,988,985      $ 1,859,418      $ 2,036,927      $ 1,745,617   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Interest-bearing core deposits(1)

   $ 960,974      $ 921,219      $ 944,216      $ 957,038      $ 869,548   

Noninterest-bearing core deposits(1)

     687,803        637,987        538,768        647,967        495,965   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Core deposits(1)

     1,648,777        1,559,206        1,482,984        1,605,005        1,365,513   

Noncore interest-bearing deposits

     107,753        68,536        62,481        80,092        72,903   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Deposits

     1,756,530        1,627,742        1,545,465        1,685,097        1,438,416   

Borrowings

     161,299        130,681        93,211        116,680        95,011   

Other noninterest-bearing liabilities

     6,374        6,120        7,512        6,559        6,586   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Liabilities

     1,924,203        1,764,543        1,646,188        1,808,336        1,540,013   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Shareholders’ equity (book)

     239,784        224,442        213,230        228,591        205,604   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Liabilities and equity

   $ 2,163,987      $ 1,988,985      $ 1,859,418      $ 2,036,927      $ 1,745,617   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Shareholders’ equity (tangible)(2)

   $ 190,267      $ 180,691      $ 170,062      $ 182,950      $ 166,387   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Period-end earning assets

   $ 2,339,966      $ 1,879,406      $ 1,725,398       
  

 

 

   

 

 

   

 

 

     

SELECTED MARKET DEPOSIT DATA

          

Eugene market core deposits, period-end(1)

   $ 785,053      $ 712,061      $ 747,298       

Portland market core deposits, period-end(1)

     671,747        590,880        549,113       

Seattle market core deposits, period-end(1)

     592,552        205,078        169,136       
  

 

 

   

 

 

   

 

 

     

Total core deposits, period-end(1)

     2,049,352        1,508,019        1,465,547       

Other deposits, period-end

     113,281        92,113        59,407       
  

 

 

   

 

 

   

 

 

     

Total

   $ 2,162,633      $ 1,600,132      $ 1,524,954       
  

 

 

   

 

 

   

 

 

     

Eugene market core deposits, average(1)

   $ 721,271      $ 738,435      $ 776,755       

Portland market core deposits, average(1)

     631,440        624,490        537,911       

Seattle market core deposits, average(1)

     296,066        196,281        168,318       
  

 

 

   

 

 

   

 

 

     

Total core deposits, average(1)

     1,648,777        1,559,206        1,482,984       

Other deposits, average

     107,753        68,536        62,481       
  

 

 

   

 

 

   

 

 

     

Total

   $ 1,756,530      $ 1,627,742      $ 1,545,465       
  

 

 

   

 

 

   

 

 

     

NET INTEREST MARGIN RECONCILIATION

          

Yield on average loans (3)

     5.23     5.07     5.24     5.15     5.31

Yield on average securities(4)

     2.54     2.66     2.52     2.59     2.52
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Yield on average earning assets(4)

     4.59     4.52     4.59     4.54     4.62

Rate on average interest-bearing core deposits

     0.26     0.26     0.25     0.26     0.27

Rate on average interest-bearing non-core deposits

     1.29     1.19     1.58     1.36     1.43
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Rate on average interest-bearing deposits

     0.37     0.32     0.34     0.34     0.36

Rate on average borrowings

     2.23     1.06     1.23     1.71     1.23
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Cost of interest-bearing funds

     0.61     0.41     0.41     0.48     0.44
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Interest rate spread(4)

     3.98     4.11     4.17     4.06     4.18
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net interest margin- fully tax equivalent yield(4)

     4.22     4.27     4.32     4.25     4.34
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Acquired loan fair value accretion impact to net interest margin (5)

     0.16     0.03     0.13     0.11     0.14
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

(1)  Core deposits include demand, interest checking, money market, savings, and local time deposits, including local nonpublic time deposits in excess of $100 thousand.
(2)  Tangible equity excludes goodwill and core deposit intangible assets related to acquisitions.
(3) Interest income includes recognized loan origination fees of $340, $231, and $152 for the three months ended September 30, 2016, June 30, 2016, and September 30, 2015, respectively, and $776 and $478 for the nine months ended September 30, 2016 and 2015, respectively.
(4)  Tax-exempt income has been adjusted to a tax-equivalent basis at a 35% tax rate. The tax equivalent yield adjustment to interest earned on loans was $323, $262 and $173 for the three months ended September 30, 2016, June 30, 2016, and September 30, 2015, respectively, and $844 and $415 for the nine months ended September 30, 2016 and 2015, respectively. The tax equivalent yield adjustment to interest earned on tax exempt securities was $260, $256 and $264 for the three months ended September 30, 2016, June 30, 2016, and September 30, 2015, respectively, and $773 and $803 for the nine months ended September 30, 2016 and 2015, respectively.
(5)  During the three months ended September 30, 2016, June 30, 2016, and September 30, 2015, accretion of the fair value adjustment on acquired loans contributed to interest income was $877, $156, and $616, respectively, and $1,442 and $1,620 for the nine months ended September 30, 2016 and 2015, respectively.


PACIFIC CONTINENTAL CORPORATION and subsidiary

Nonperforming Assets, Asset Quality Ratios and Allowance for Loan Losses

(Dollars in thousands)

(Unaudited)

 

     September 30,     June 30,     September 30,  
     2016     2016     2015  
NONPERFORMING ASSETS       

Non-accrual loans

      

Real estate secured loans:

      

Permanent loans:

      

Multi-family residential

   $ —        $ —        $ —     

Residential 1-4 family

     1,465        408        569   

Owner-occupied commercial

     1,634        1,662        2,371   

Nonowner-occupied commercial

     3,475        727        829   
  

 

 

   

 

 

   

 

 

 

Total permanent real estate loans

     6,574        2,797        3,769   

Construction loans:

      

Multi-family residential

     —          —          —     

Residential 1-4 family

     —          —          53   

Commercial real estate

     —          —          —     

Commercial bare land and acquisition & development

     —          —          —     

Residential bare land and acquisition & development

     —          —          —     
  

 

 

   

 

 

   

 

 

 

Total construction real estate loans

     —          —          53   
  

 

 

   

 

 

   

 

 

 

Total real estate loans

     6,574        2,797        3,822   

Commercial loans

     5,619        1,501        983   
  

 

 

   

 

 

   

 

 

 

Total nonaccrual loans

     12,193        4,298        4,805   

90-days past due and accruing interest

     —          —          —     

Total nonperforming loans

     12,193        4,298        4,805   
  

 

 

   

 

 

   

 

 

 

Nonperforming loans guaranteed by government

     (2,427     (2,667     (2,574

Net nonperforming loans

     9,766        1,631        2,231   
  

 

 

   

 

 

   

 

 

 

Other real estate owned

     13,066        12,108        11,854   
  

 

 

   

 

 

   

 

 

 

Total nonperforming assets, net of guaranteed loans

   $ 22,832      $ 13,739      $ 14,085   
  

 

 

   

 

 

   

 

 

 
ASSET QUALITY RATIOS       

Allowance for loan losses as a percentage of total loans outstanding

     1.14     1.29     1.23

Allowance for loan losses as a percentage of total nonperforming loans, net of government guarantees

     210.23     1172.72     744.60

Quarter-to-date net loan (recoveries), charge offs, as a percentage of average loans, annualized

     -0.01     0.12     0.00

Net nonperforming loans as a percentage of total loans

     0.54     0.11     0.16

Nonperforming assets as a percentage of total assets

     0.90     0.68     0.75

Consolidated classified asset ratio(1)

     23.80     20.81     25.14

Past due as a percentage of total loans (2)

     0.01     0.02     0.14

 

     Three months ended     Nine months ended  
     September 30,     June 30,     September 30,     September 30,     September 30,  
     2016     2016     2015     2016     2015  
ALLOWANCE FOR LOAN LOSSES           

Balance at beginning of period

   $ 19,127      $ 17,596      $ 16,013      $ 17,301      $ 15,637   

Provision for loan losses

     1,380        1,950        625        3,575        1,175   

Loan charge-offs

     (44     (668     (105     (712     (631

Loan recoveries

     68        249        79        367        431   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Net (charge-offs) recoveries

     24        (419     (26     (345     (200
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Balance at end of period

   $ 20,531      $ 19,127      $  16,612      $ 20,531      $ 16,612   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

(1) Consolidated classified asset ratio is defined as the sum of all loan-related contingent liabilities and loans internally graded substandard or worse, impaired loans (net of government guarantees), adversely classified securities, and other real estate owned, divided by total consolidated Tier 1 capital plus the allowance for loan losses.
(2)  Defined as loans past due more than 30 days and still accruing interest, as a percentage of total loans, net of deferred fees.


PACIFIC CONTINENTAL CORPORATION and subsidiary

Consolidated Financial Highlights

(Dollars in thousands, except share and per share data)

(Unaudited)

 

     3rd Quarter     2nd Quarter     1st Quarter     4th Quarter     3rd Quarter  
     2016     2016     2016     2015     2015  

EARNINGS

          

Net interest income

   $ 20,771      $ 19,147      $ 18,809      $ 18,822      $ 18,308   

Provision for loan loss

   $ 1,380      $ 1,950      $ 245      $ 520      $ 625   

Noninterest income

   $ 1,919      $ 1,747      $ 1,807      $ 2,008      $ 1,714   

Noninterest expense

   $ 13,825      $ 14,932      $ 12,007      $ 11,706      $ 11,182   

Net income

   $ 4,851      $ 2,606      $ 5,459      $ 5,528      $ 5,325   

Basic earnings per share

   $ 0.24      $ 0.13      $ 0.28      $ 0.28      $ 0.27   

Diluted earnings per share

   $ 0.23      $ 0.13      $ 0.28      $ 0.28      $ 0.27   

Average shares outstanding

     20,511,392        19,697,314        19,607,106        19,598,484        19,591,666   

Average diluted shares outstanding

     20,676,964        19,868,967        19,782,282        19,766,098        19,816,770   

PERFORMANCE RATIOS

          

Return on average assets

     0.89     0.53     1.12     1.16     1.14

Return on average equity (book)

     8.05     4.67     9.92     10.10     9.91

Return on average equity (tangible) (1)

     10.14     5.80     12.35     12.60     12.42

Net interest margin - fully tax equivalent
yield (2)

     4.22     4.27     4.27     4.35     4.31

Efficiency ratio (tax equivalent) (3)

     60.24     70.60     57.52     55.50     55.12

Full-time equivalent employees

     366        333        339        322        321   

CAPITAL

          

Tier 1 leverage ratio

     10.33     9.62     9.75     9.93     9.88

Common Equity tier 1 ratio

     9.43     10.07     10.88     10.97     11.00

Tier 1 risk based ratio

     9.99     10.52     11.37     11.47     11.49

Total risk based ratio

     12.55     13.54     12.46     12.58     12.58

Book value per share

   $ 12.23      $ 11.48      $ 11.46      $ 11.15      $ 11.06   

Regular cash dividend per share

   $ 0.11      $ 0.11      $ 0.11      $ 0.11      $ 0.11   

ASSET QUALITY

          

Allowance for loan losses (ALL)

   $ 20,531      $ 19,127      $ 17,596      $ 17,301      $ 16,612   

Non performing loans (NPLs) net of government guarantees

   $ 9,766      $ 1,631      $ 2,642      $ 2,719      $ 2,231   

Non performing assets (NPAs) net of government guarantees

   $ 22,832      $ 13,739      $ 14,389      $ 14,466      $ 14,085   

Net loan (recoveries) charge offs

   $ (24   $ 419      $ (50   $ (169   $ 26   

ALL as a percentage of gross loans

     1.14     1.29     1.23     1.23     1.23

ALL as a % NPLs, net of government guarantees

     210.23     1172.72     666.01     636.30     744.60

Net loan charge offs (recoveries) to average loans

     -0.01     0.12     -0.01     -0.02     0.00

Net NPLs as a percentage of total loans

     0.54     0.11     0.18     0.19     0.16

Nonperforming assets as a percentage of total assets

     0.90     0.68     0.73     0.76     0.75

Consolidated classified asset ratio(4)

     23.80     20.81     20.96     23.03     25.14

Past due as a percentage of total loans (5)

     0.01     0.02     0.07     0.03     0.14

END OF PERIOD BALANCES

          

Total securities and short term deposits

   $ 553,761      $ 414,381      $ 413,273      $ 379,454      $ 398,366   

Total loans net of allowance

   $ 1,786,205      $ 1,465,025      $ 1,412,138      $ 1,387,181      $ 1,339,195   

Total earning assets

   $ 2,344,609      $ 1,887,757      $ 1,828,922      $ 1,771,843      $ 1,744,329   

Total assets

   $ 2,539,060      $ 2,025,410      $ 1,965,705      $ 1,909,478      $ 1,878,283   

Total non-interest bearing deposits

   $ 901,290      $ 624,146      $ 675,296      $ 568,688      $ 544,009   

Core deposits (6)

   $ 2,049,352      $ 1,508,019      $ 1,633,941      $ 1,533,942      $ 1,465,547   

Total deposits

   $ 2,162,633      $ 1,600,132      $ 1,696,588      $ 1,597,093      $ 1,524,954   

AVERAGE BALANCES

          

Total securities and short term deposits

   $ 456,871      $ 408,378      $ 417,439      $ 401,870      $ 406,579   

Total loans net of allowance

   $ 1,558,018      $ 1,444,956      $ 1,403,115      $ 1,357,461      $ 1,319,622   

Total earning assets

   $ 2,014,889      $ 1,853,334      $ 1,820,554      $ 1,759,331      $ 1,725,398   

Total assets

   $ 2,163,987      $ 1,988,985      $ 1,956,412      $ 1,893,262      $ 1,859,418   

Total non-interest bearing deposits

   $ 687,803      $ 637,987      $ 617,672      $ 584,445      $ 538,768   

Core deposits (6)

   $ 1,648,777      $ 1,559,206      $ 1,606,548      $ 1,526,805      $ 1,482,984   

Total deposits

   $ 1,756,530      $ 1,627,742      $ 1,670,231      $ 1,586,791      $ 1,545,465   

 

(1) Tangible equity excludes goodwill and core deposit intangible assets related to acquisitions.
(2) Net interest margin is reported on a tax-equivalent yield basis at a 35% tax rate.
(3) Efficiency ratio is noninterest expense as a percent of net interest income (on a tax-equivalent basis) plus noninterest income.
(4) The sum of all loan-related contingent liabilities and loans internally graded substandard or worse, impaired loans (net of government guarantees), adversely classified securities, and other real estate owned, divided by total consolidated Tier 1 capital plus the allowance for loan losses.
(5) Defined as loans past due more than 30 days and still accruing interest, as a percentage of total loans, net of deferred fees.
(6) Core deposits include demand, interest checking, money market, savings, and local time deposits, including local nonpublic time deposits in excess of $100 thousand.