BBVA USA Bancshares, Inc. - FORM 8-K - EX-99.1 - EXHIBIT 99.1

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8-K - 8-K - BBVA USA Bancshares, Inc.	bbvacompass123120178k.htm

Exhibit 99.1

February 1, 2018

Fourth quarter revenue up 14 percent

BBVA Compass reports fourth quarter results


•	Quarterly net income totals $52 million; includes $121 million non-cash charge related to the revaluation of net deferred tax assets


◦	Adjusted net income¹ totals $173 million, up 94 percent from a year ago and up 57 percent for the full-year of 2017


◦	Adjusted ROA¹ and adjusted ROTE¹ for the quarter were 0.79 percent and 8.48 percent, respectively


•	Total revenue increases 14 percent from prior year levels as both net interest income and noninterest income post double-digit gains


◦	Quarterly net interest income increases 14 percent while the net interest margin (FTE) rises 44 basis points from prior year quarter


•	Noninterest expense growth well contained in 2017 at 3 percent


•	Positive operating leverage results in record quarterly operating income¹ of $285 million, up 20 percent from prior year quarter and 21 percent for the full year


•	Strong momentum in second half of 2017 leads to growth in loans and deposits


◦	Total loans of $61.7 billion up 2 percent from prior year and up 9 percent (annualized) on a linked quarter basis


◦	Newly funded customer loans of $18.4 billion in 2017, up 27 percent from year ago levels


◦	Total deposits of $69.3 billion rise 3 percent from a year ago and 12 percent (annualized) on a linked quarter basis


•	Key credit quality indicators show continued improvement throughout the year


◦	Nonperforming loan ratio at 1.16 percent, down 47 basis points from year-end 2016 levels and 2 basis points from 3Q17


◦	Energy portfolio nonaccrual loans drop 61 percent from year ago levels and 17 percent from 3Q17; portfolio now represents 4.5 percent of total loans


◦	Allowance to loan ratio at 1.37 percent and nonperforming loan coverage ratio rises to 117 percent compared to 85 percent at the end of 2016

BBVA Compass Bancshares, Inc., a Sunbelt-based bank holding company (BBVA Compass), reported today net income of $52 million for the fourth quarter of 2017, a 42 percent decrease from the $89 million earned during the fourth quarter of 2016. Included in fourth quarter 2017 results is income tax expense of approximately $121 million related to the revaluation of net deferred tax assets at the lower statutory tax rate mandated by the Tax Cuts and Jobs Act (non-cash charge). Excluding the impact of this item, adjusted net income for the quarter was $173 million, a 33 percent increase from third quarter 2017 and a 94 percent increase from the fourth quarter 2016.

Net income for full-year 2017 totaled $461 million, an increase of 24 percent from the $372 million earned during the full-year of 2016. Excluding the impact of the non-cash charge, adjusted net income for the full-year 2017 was $582 million, up 57 percent. The following table summarizes the impact of new tax legislation on fourth quarter and full-year 2017 results.



Impact of Tax Cuts and Jobs Act
Dollars in thousands (unaudited)
									Full Year
	4Q17			4Q16			% Change		2017			2016			% Change
Net Income:
As reported	$	52,072		$	89,403		(42	)%	$	460,786		$	371,523		24	%
Adjusted¹	173,315			89,403			94		582,029			371,523			57

ROA:
As reported	0.24		%	0.40		%			0.53		%	0.41		%
Adjusted¹	0.79			0.40					0.67			0.41

ROTE:¹
As reported	2.55		%	4.51		%			5.77		%	4.82		%
Adjusted	8.48			4.51					7.28			4.82

“The positive momentum we have built in our organization allowed us to report solid results for the year, and we finished the year on a strong note by delivering record operating income in the fourth quarter,” said Onur Genç, president and CEO of BBVA Compass. “While the change in tax law required a revaluation of our net deferred tax assets, underlying trends in all of our businesses were very positive in the quarter. Revenue growth was robust and well-balanced as both net interest income and noninterest income posted double-digit gains over the year ago quarter. At the same time, balance sheet growth accelerated during the quarter both in terms of loans and deposits, while credit quality metrics improved throughout the year. As we enter 2018, our plan is to continue building on this momentum while also increasing our digital transformation efforts designed to increase our digital sales capabilities and improve the customer experience.”

Total revenue for the quarter was $901 million, an increase of 14 percent from fourth quarter 2016 levels. For the full-year 2017, total revenue was $3.4 billion, an increase of 9 percent from $3.1 billion in 2016. Net interest income totaled $604 million, up 14 percent from the fourth quarter of 2016 and 10 percent (annualized) on a linked quarter basis. The percent net interest margin in the fourth quarter was 3.22 percent, up 44 basis points from the fourth quarter of 2016 and 9 basis points from the third quarter of 2017. On a year-to-date basis, the percent net interest margin was 3.10 percent, an increase of 46 basis points compared to the same timeframe a year ago.

Noninterest income for the quarter totaled $297 million, an increase of 14 percent compared to the $261 million recorded in the fourth quarter of 2016. Positive performances were broad-based led by increases in corporate and correspondent investment sales, investment banking and advisory fees, retail investment sales and other income, which includes a sundry of miscellaneous items. While noninterest expense growth in the quarter was 11 percent, overall expense growth for the year was well-contained at 3 percent. As a result of this positive operating leverage, total operating income¹ was a record $285 million in the quarter, an increase of 20 percent compared to the fourth quarter of 2016. For the full-year 2017, operating income¹ totaled $1.1 billion, an increase of 21 percent compared to the full-year of 2016.

“While overall balance sheet growth was muted during the first half of the year, loan growth accelerated during the second half of the year, particularly during the fourth quarter,” Genç noted. “During the year, we funded a record $18.4 billion of customer loans, an increase of 27 percent compared to the prior year, including $5.9 billion in the fourth quarter. Particularly noteworthy during the year was our 6^th place ranking nationally in terms of the number of SBA 7(a) loans originated. While our commercial

loan pipeline remains strong, continuing to build out our capabilities, particularly with respect to our consumer offerings in the digital space, remains a priority and we have been encouraged by the recent success of our Express Personal Loan product.”

Total loans at the end of the fourth quarter of 2017 were $61.7 billion, a 9 percent (annualized) increase on a linked quarter basis and a 2 percent increase from the end of the fourth quarter of 2016. Total deposits at the end of the fourth quarter of 2017 were $69.3 billion, a 12 percent (annualized) increase on a linked quarter basis and a 3 percent increase at the end of the fourth quarter of 2016. Total noninterest bearing deposits increased 6 percent compared to a year ago and 10 percent on a linked quarter basis. Interest bearing deposits increased 1 percent compared to a year ago and 13 percent (annualized) on a linked quarter basis led by a 14 percent (annualized) increase in interest bearing transaction accounts.

“Maintaining strong credit quality standards is a top priority and during the year many of our key metrics showed improvement, a trend that continued in the fourth quarter,” Genç noted. Nonperforming loans totaled $718 million at the end of the quarter, a decrease of $265 million since the end of the fourth quarter of 2016. Nonperforming loans in the primarily reserved-based energy portfolio declined $31 million during the quarter, bringing the year-over-year decrease to $236 million. Nonperforming loans as a percentage of total loans were 1.16 percent, down from 1.63 percent at year-end 2016. Net charge-offs as a percentage of average loans totaled 42 basis points in the quarter and 47 basis points for the full-year of 2017. The allowance for loan losses as a percentage of total loans ended the year at 1.37 percent while the coverage ratio of nonperforming loans rose to 117 percent compared to 85 percent at the end of 2016.

Total shareholder’s equity at the end of the fourth quarter totaled $13.0 billion, a 2 percent increase from $12.8 billion at the end of the fourth quarter of 2016. The CET1 ratio rose to 11.80 percent² at the end of the fourth quarter of 2017, up 31 basis points from the end of the fourth quarter of 2016. All of BBVA Compass’ regulatory capital ratios significantly exceed the requirements under “well-capitalized” guidelines.

¹ Adjusted net income, adjusted return on average assets and adjusted return on average tangible equity exclude the impact of the revaluation of net deferred tax assets mandated by the Tax Cuts and Jobs Act. These measures, along with operating income and average tangible equity are non-GAAP financial measures we believe aid in understanding certain areas of our performance. The calculation of these measures is included on the page titled Non-GAAP Reconciliation.

² Regulatory ratios at December 31, 2017, are estimated.



Contact details:
Christina Anderson		Ed Bilek
External Communications		Investor Relations
Tel. 205.524.5214		Tel. 205.297.3331
christina.anderson@bbva.com		ed.bilek@bbva.com

About BBVA Compass

BBVA Compass is a Sunbelt-based financial institution that operates 649 branches, including 336 in Texas, 89 in Alabama, 63 in Arizona, 61 in California, 45 in Florida, 37 in Colorado and 18 in New Mexico. BBVA Compass ranks among the top 25 largest U.S. commercial banks based on deposit market share and ranks among the largest banks in Alabama (2nd), Texas (4th) and Arizona (6th). BBVA Compass has been recognized as one of the leading small business lenders by the Small Business Administration (SBA) and ranked 6th nationally in the total number of SBA loans originated in fiscal year 2017. Additional information about BBVA Compass can be found under the Investor Relations tab at bbvacompass.com, by following @BBVACompassNews on Twitter or visiting newsroom.bbvacompass.com.

About BBVA Group

BBVA (NYSE: BBVA) is a customer-centric global financial services group founded in 1857. The Group has a strong leadership position in the Spanish market, is the largest financial institution in Mexico, it has leading franchises in South America and the Sunbelt Region of the United States; and it is also the leading shareholder in Garanti, Turkey’s biggest bank for market capitalization. Its diversified business is focused on high-growth markets and it relies on technology as a key sustainable competitive advantage. Corporate responsibility is at the core of its business model. BBVA fosters financial education and inclusion, and supports scientific research and culture. It operates with the highest integrity, a long-term vision and applies the best practices. More information about BBVA Group can be found at bbva.com.

Forward-Looking Statements

Certain statements in this press release may contain forward-looking statements about BBVA Compass Bancshares, Inc. (the “Company”) and its industry that involve substantial risks and uncertainties. The use of “we,” “our” and similar terms refer to the Company. Statements other than statements of current or historical fact, including statements regarding our future financial condition, results of operations, business plans, liquidity, cash flows, projected costs, and the impact of any laws or regulations applicable to the Company, constitute forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Words such as “anticipates,” “believes,” “estimates,” “expects,” “forecasts,” “intends,” “plans,” “projects,” “may,” “will,” “should,” and other similar expressions are intended to identify these forward-looking statements. These forward-looking statements reflect the Company’s views regarding future events and financial performance. Such statements are subject to risks, uncertainties, assumptions and other important factors, many of which may be beyond the Company’s control, that could cause actual results to differ materially from anticipated results. If the Company’s assumptions and estimates are incorrect, or if the Company becomes subject to significant limitations as the result of litigation or regulatory action, then the Company’s actual results could vary materially from those expressed or implied in these forward-looking statements. The forward-looking statements are and will be based on the Company’s then current views and assumptions regarding future events and speak only as of their dates made. The Company assumes no obligation to update any forward-looking statement, whether as a result of new information, future events, or otherwise, except as required by securities law or regulation. For further information regarding risks and uncertainties associated with the Company’s business, please refer to the “Risk Factors” section of the Company’s Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (the “SEC”) on March 1, 2017, as updated by our subsequent SEC filings.

BBVA COMPASS BANCSHARES, INC. (Unaudited) (Dollars in thousands)

	Three Months Ended December 31,						%		Years Ended December 31,						%
	2017			2016			Change		2017			2016			Change
EARNINGS SUMMARY
Net interest income	$	603,545		$	531,752		14		$	2,330,167		$	2,067,681		13
Noninterest income [a]	297,169			261,053			14		1,042,942			1,026,232			2
Total revenue [a]	900,714			792,805			14		3,373,109			3,093,913			9
Investment securities gain (loss), net	—			—			—		3,033			30,037			(90	)
Loss on prepayment of FHLB advances	—			(295		)	(100	)	—			(295		)	(100	)
Provision for loan losses	58,835			37,564			57		287,693			302,589			(5	)
Goodwill impairment	—			59,901			(100	)	—			59,901			(100	)
Noninterest expense	615,828			554,169			11		2,311,587			2,243,621			3
Pretax income	226,051			140,876			60		776,862			517,544			50
Income tax expense	173,979			51,473			238		316,076			146,021			116
Net income	$	52,072		$	89,403		(42	)	$	460,786		$	371,523		24
Adjusted net income [b]	$	173,315		$	89,403		94		$	582,029		$	371,523		57

SELECTED RATIOS
Return on average assets	0.24		%	0.40		%			0.53		%	0.41		%
Return on average assets- adjusted [b]	0.79			0.40					0.67			0.41
Return on average tangible equity [b]	2.55			4.51					5.77			4.82
Return on average tangible equity- adjusted [b]	8.48			4.51					7.28			4.82
Average common equity to average assets	14.82			14.39					14.63			13.82
Average loans to average total deposits	89.96			89.24					90.68			90.58
Common equity tier 1 capital (CET1) [c]	11.80			11.49					11.80			11.49
Tier I capital ratio [c]	12.15			11.85					12.15			11.85
Total capital ratio [c]	14.36			14.31					14.36			14.31
Leverage ratio [c]	9.98			9.46					9.98			9.46
[a] Excludes net gain on sales of investment securities and gain on prepayment of FHLB advances.
[b] Non-GAAP measure that we believe aids in understanding certain areas of our performance. The calculation of this measure is included on the page titled Non-GAAP Reconciliation.
[c] Current period regulatory capital ratios are estimated.

BBVA COMPASS BANCSHARES, INC. (Unaudited) (Dollars in thousands)

	Average for Three Months						Average for Year						Ending Balance
	Ended December 31,				%		Ended December 31,				%		December 31,				%
	2017		2016		Change		2017		2016		Change		2017		2016		Change
BALANCE SHEET HIGHLIGHTS
Total loans	$	61,170,130	$	60,428,830	1		$	60,419,711	$	61,505,935	(2	)	$	61,690,878	$	60,223,112	2
Total investment securities	13,555,910		12,800,050		6		13,231,647		12,607,031		5		13,729,880		12,868,272		7
Earning assets	77,204,217		78,691,897		(2	)	77,745,063		81,335,489		(4	)	78,359,040		77,989,196		—
Total assets	86,990,170		88,639,855		(2	)	87,358,298		91,064,360		(4	)	87,320,579		87,079,953		—
Noninterest bearing demand deposits	21,389,000		20,926,593		2		21,039,822		20,556,608		2		21,630,694		20,332,792		6
Interest bearing transaction accounts	33,059,701		32,835,469		1		32,783,151		32,789,385		—		33,743,887		33,518,871		1
Total transaction accounts	54,448,701		53,762,062		1		53,822,973		53,345,993		1		46,991,974		53,851,663		(13	)
Total deposits	67,994,615		67,718,213		—		66,627,368		67,904,564		(2	)	69,256,313		67,279,533		3
Shareholder's equity	13,150,577		12,982,707		1		13,035,797		12,818,572		2		13,013,310		12,750,707		2

BBVA COMPASS BANCSHARES, INC. (Unaudited) (Dollars in thousands)

	2017												2016
	December 31			September 30			June 30			March 31			December 31
NONPERFORMING ASSETS
Nonaccrual loans [a]	$	658,865		$	666,812		$	760,313		$	825,988		$	921,042
Loans 90 days or more past due [b]	58,378			43,049			59,434			65,617			61,542
TDRs 90 days or more past due	751			963			969			1,185			589
Total nonperforming loans [a]	717,994			710,824			820,716			892,790			983,173
Other real estate owned, net (OREO)	17,278			22,012			22,965			25,113			21,112
Other repossessed assets	13,473			11,443			12,298			9,540			7,587
Total nonperforming assets	$	748,745		$	744,279		$	855,979		$	927,443		$	1,011,872

TDRs accruing and past due less than 90 days	$	127,482		$	95,521		$	97,088		$	128,558		$	110,733


Total nonperforming loans as a % of loans	1.16		%	1.18		%	1.37		%	1.49		%	1.63		%
Total nonperforming assets as a % of total loans, other real estate, and other repossessed assets	1.21			1.23			1.43			1.55			1.68
[a] Includes loans held for sale.
[b] Excludes loans classified as troubled debt restructurings (TDRs).



	Three Months Ended
	2017												2016
	December 31			September 30			June 30			March 31			December 31
ALLOWANCE FOR LOAN LOSSES
Balance at beginning of period	$	849,119		$	816,952		$	834,106		$	838,293		$	862,080
Net charge-offs (NCO)	65,194			71,267			62,439			84,326			61,351
Provision for loan losses	58,835			103,434			45,285			80,139			37,564
Balance at end of period	$	842,760		$	849,119		$	816,952		$	834,106		$	838,293

Allowance for loan losses as a % of total loans	1.37		%	1.41		%	1.36		%	1.40		%	1.40		%
Allowance for loan losses as a % of nonperforming loans [c]	117.38			119.46			99.54			93.43			85.26
Allowance for loan losses as a % of nonperforming assets [c]	112.56			114.09			95.44			89.94			82.85

Annualized as a % of average loans:
NCO - QTD	0.42			0.47			0.42			0.57			0.40
NCO - YTD	0.47			0.48			0.49			0.57			0.37
[c] Includes loans held for sale that are on nonaccrual status.

BBVA COMPASS BANCSHARES, INC. (Unaudited) (Dollars in thousands)

	December 31, 2017								September 30, 2017								December 31, 2016
	Recorded Investment			Total Commitment			Nonaccrual		Recorded Investment			Total Commitment			Nonaccrual		Recorded Investment			Total Commitment			Nonaccrual
ENERGY PORTFOLIO
Exploration and production	$	1,409,376		$	3,836,638		$	147,960	$	1,630,303		$	4,080,635		$	178,449	$	1,654,565		$	4,182,861		$	308,096
Midstream	973,087			3,005,131			—		976,845			3,011,822			—		1,199,844			3,230,513			11,298
Drilling oil and support services	178,338			370,153			2,328		179,636			373,389			2,350		263,770			467,908			66,811
Refineries and terminals	231,141			363,577			160		165,453			266,081			205		128,010			262,618			339
Other	—			—			—		—			—					—			—			—
Total energy portfolio	$	2,791,942		$	7,575,499		$	150,448	$	2,952,237		$	7,731,927		$	181,004	$	3,246,189		$	8,143,900		$	386,544

	December 31, 2017								September 30, 2017								December 31, 2016
	As a % of Energy Loans			As a % of Total Loans					As a % of Energy Loans			As a % of Total Loans					As a % of Energy Loans			As a % of Total Loans
ENERGY PORTFOLIO
Exploration and production	50.5		%	2.3		%			55.2		%	2.7		%			51.0		%	2.7		%
Midstream	34.8			1.6					33.1			1.6					37.0			2.0
Drilling oil and support services	6.4			0.3					6.1			0.3					8.1			0.4
Refineries and terminals	8.3			0.4					5.6			0.3					3.9			0.2
Other	—			—					—			—					—			—
Total energy portfolio	100.0		%	4.5		%			100.0		%	4.9		%			100.0		%	5.4		%

BBVA COMPASS BANCSHARES, INC. (Unaudited) (Dollars in thousands)

	Three Months Ended December 31,
	2017							2016
	Average Balance			Income/Expense		Yield/ Rate		Average Balance			Income/ Expense		Yield/Rate
YIELD/RATE ANALYSIS
(Taxable Equivalent Basis)
Assets
Earning assets:
Loans	$	61,170,130		$	661,873	4.29	%	$	60,428,830		$	575,195	3.79	%
Investment securities available for sale [a]	12,644,190			60,324		1.89		11,648,240			60,930		2.08
Investment securities held to maturity	1,056,906			9,508		3.57		1,219,537			9,650		3.15
Other earning assets [b]	2,478,177			8,415		1.35		5,463,017			20,819		1.52
Total earning assets [a]	77,349,403			740,120		3.80		78,759,624			666,594		3.37
Allowance for loan losses	(853,546		)					(866,885		)
Unrealized gain (loss) on securities available for sale	(145,186		)					(67,727		)
Other assets	10,639,499							10,814,843
Total assets	$	86,990,170						$	88,639,855

Liabilities and Shareholders' Equity
Interest bearing liabilities:
Interest bearing demand deposits	$	7,843,974		$	7,995	0.40		$	7,429,395		$	4,772	0.26
Savings and money market accounts	25,215,727			34,463		0.54		25,406,074			23,671		0.37
Certificates and other time deposits	13,545,914			45,558		1.33		13,865,231			45,353		1.30
Foreign office deposits	—			—		—		90,920			50		0.22
Total interest bearing deposits	46,605,615			88,016		0.75		46,791,620			73,846		0.63
FHLB and other borrowings	3,551,958			22,392		2.50		3,281,743			23,825		2.89
Federal funds purchased and securities sold under agreement to repurchase [b]	40,666			464		4.53		101,168			4,640		18.25
Other short-term borrowings	114,140			2,191		7.62		3,381,697			12,963		1.52
Total interest bearing liabilities	50,312,379			113,063		0.89		53,556,228			115,274		0.86
Noninterest bearing deposits	21,389,000							20,926,593
Other noninterest bearing liabilities	2,138,214							1,174,327
Total liabilities	73,839,593							75,657,148
Shareholder's equity	13,150,577							12,982,707
Total liabilities and shareholder's equity	$	86,990,170						$	88,639,855

Net interest income/ net interest spread				627,057		2.91	%				551,320		2.51	%
Net yield on earning assets						3.22	%						2.78	%

Total taxable equivalent adjustment				23,512							19,568

Net interest income				$	603,545						$	531,752
[a] Excludes adjustment for market valuation.
[b] Yield/rate reflects impact of balance sheet offsetting.

BBVA COMPASS BANCSHARES, INC. (Unaudited) (Dollars in thousands)

	Years Ended December 31,
	2017							2016
	Average Balance			Income/ Expense		Yield/ Rate		Average Balance			Income/ Expense		Yield/ Rate
YIELD/RATE ANALYSIS
(Taxable Equivalent Basis)
Assets
Earning assets:
Loans	$	60,419,711		$	2,521,613	4.17	%	$	61,505,935		$	2,303,017	3.74	%
Investment securities available for sale [a]	12,224,405			224,807		1.84		11,356,093			192,183		1.69
Investment securities held to maturity	1,120,472			39,128		3.49		1,256,687			38,943		3.10
Other earning assets [b]	4,093,705			67,635		1.65		7,222,523			74,755		1.04
Total earning assets [a]	77,858,293			2,853,183		3.66		81,341,238			2,608,898		3.21
Allowance for loan losses	(840,359		)					(834,310		)
Unrealized gain (loss) on securities available for sale	(113,230		)					(5,749		)
Other assets	10,453,594							10,563,181
Total assets	$	87,358,298						$	91,064,360

Liabilities and Shareholders' Equity
Interest bearing liabilities:
Interest bearing demand deposits	$	7,858,504		27,206		0.35		$	7,042,165		16,639		0.24
Savings and money market accounts	24,924,647			107,106		0.43		25,747,220			99,567		0.39
Certificates and other time deposits	12,804,395			165,005		1.29		14,454,532			188,209		1.30
Foreign office deposits	—			—		—		104,039			210		0.20
Total interest bearing deposits	45,587,546			299,317		0.66		47,347,956			304,625		0.64
FHLB and other borrowings	3,973,465			93,814		2.36		4,226,225			82,744		1.96
Federal funds purchased and securities sold under agreement to repurchase [b]	58,624			16,926		28.87		451,980			21,165		4.68
Other short-term borrowings	1,703,738			26,424		1.55		3,778,752			54,244		1.44
Total interest bearing liabilities	51,323,373			436,481		0.85		55,804,913			462,778		0.83
Noninterest bearing deposits	21,039,822							20,556,608
Other noninterest bearing liabilities	1,959,306							1,884,267
Total liabilities	74,322,501							78,245,788
Shareholder's equity	13,035,797							12,818,572
Total liabilities and shareholder's equity	$	87,358,298						$	91,064,360

Net interest income/ net interest spread				2,416,702		2.81	%				2,146,120		2.38	%
Net yield on earning assets						3.10	%						2.64	%

Total taxable equivalent adjustment				86,535							78,439

Net interest income				$	2,330,167						$	2,067,681
[a] Excludes adjustment for market valuation.
[b] Yield/rate reflects impact of balance sheet offsetting.

BBVA COMPASS BANCSHARES, INC. (Unaudited) (Dollars in thousands)

	Year Ended							Three Months Ended
	December 31,					%		2017								2016
	2017		2016			Change		December 31		September 30		June 30		March 31		December 31
NONINTEREST INCOME
Service charges on deposit accounts	$	222,110	$	214,294		4		$	56,070	$	55,953	$	54,919	$	55,168	$	55,901
Card and merchant processing fees	128,129		123,668			4		33,380		32,297		32,460		29,992		31,161
Retail investment sales	109,214		102,982			6		26,338		26,817		28,588		27,471		23,293
Investment banking and advisory fees	103,701		107,116			(3	)	24,957		30,500		19,943		28,301		20,792
Money transfer income	101,509		104,592			(3	)	24,101		24,881		27,330		25,197		28,632
Asset management fees	40,465		34,875			16		10,303		10,336		10,055		9,771		8,906
Corporate and correspondent investment sales	38,052		24,689			54		11,803		5,145		12,189		8,915		3,199
Mortgage banking income	14,356		21,496			(33	)	4,720		3,450		3,316		2,870		16,086
Bank owned life insurance	17,108		17,243			(1	)	4,397		4,322		4,220		4,169		4,202
Other	268,298		275,277			(3	)	101,100		61,060		53,305		52,833		68,881
	1,042,942		1,026,232			2		297,169		254,761		246,325		244,687		261,053
Investment securities gains, net	3,033		30,037			(90	)	—		3,033		—		—		—
Loss on prepayment of FHLB and other borrowings	—		(295		)	NM		—		—		—		—		(295		)
Total noninterest income	$	1,045,975	$	1,055,974		(1	)	$	297,169	$	257,794	$	246,325	$	244,687	$	260,758

NONINTEREST EXPENSE
Salaries, benefits and commissions	$	1,131,971	$	1,119,676		1		$	296,146	$	279,384	$	288,426	$	268,015	$	283,609
Professional services	263,490		242,206			9		76,068		64,775		64,840		57,807		63,810
Equipment	247,891		242,273			2		63,200		60,656		62,405		61,630		62,627
Net occupancy	166,693		160,997			4		41,125		42,227		41,240		42,101		40,116
Money transfer expense	65,790		67,474			(2	)	15,721		15,938		17,807		16,324		17,426
Marketing	52,220		50,549			3		7,950		14,996		15,729		13,545		13,018
Communications	20,554		21,046			(2	)	4,970		5,084		5,281		5,219		5,406
Other	362,978		339,400			7		110,648		90,902		76,757		84,671		68,157
	2,311,587		2,243,621			3		615,828		573,962		572,485		549,312		554,169
Goodwill impairment	—		59,901			(100	)	—		—		—		—		59,901
Total noninterest expense	$	2,311,587	$	2,303,522		—		$	615,828	$	573,962	$	572,485	$	549,312	$	614,070
NM = Not meaningful

BBVA COMPASS BANCSHARES, INC. (Unaudited) (Dollars in thousands)

	Three Months Ended December 31,						Years Ended December 31,
	2017			2016			2017			2016
NON-GAAP RECONCILIATION

Computation of Operating Income:
Net interest income (GAAP)	$	603,545		$	531,752		$	2,330,167		$	2,067,681
Plus: noninterest income (GAAP)	297,169			260,758			1,045,975			1,055,974
Less: noninterest expense (GAAP)	615,828			614,070			2,311,587			2,303,522
Plus: goodwill impairment (GAAP)	—			59,901			—			59,901
Operating income (non-GAAP)	$	284,886		$	238,341		$	1,064,555		$	880,034


Computation of Average Tangible Equity:
Total stockholder's equity (average) (GAAP)	$	13,150,577		12,982,707			$	13,035,797		12,818,572
Less: Goodwill and other intangibles (average) (GAAP)	5,039,014			5,101,494			5,043,805			5,107,002
Average tangible equity (non-GAAP) [B]	$	8,111,563		7,881,213			$	7,991,992		7,711,570
Net income (GAAP) [A]	$	52,072		89,403			$	460,786		371,523
Return on average tangible equity (non-GAAP) ([A]/[B], annualized)	2.55		%	4.51		%	5.77		%	4.82		%

Computation of Adjusted Net Income, Return on Average Assets and Return on Average Tangible Equity:
Net income (GAAP)	$	52,072		$	89,403		$	460,786		$	371,523
Plus: Revaluation of net deferred tax assets (GAAP)	121,243			—			121,243			—
Adjusted net income (non-GAAP) [C]	$	173,315		89,403			582,029			371,523
Average assets (GAAP) [D]	86,990,170			88,639,855			87,358,298			91,064,360
Return on average assets - adjusted (non-GAAP) ([C]/[D], annualized)	0.79		%	0.40		%	0.67		%	0.41		%
Return on average tangible equity - adjusted (non-GAAP) ([C]/[B], annualized)	8.48			4.51			7.28			4.82

BBVA COMPASS BANCSHARES, INC SUPPLEMENTAL LOAN PORTFOLIO INFORMATION (Unaudited) (Dollars in thousands)

	At or Quarter Ended December 31, 2017
	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due		Nonaccrual		Accruing TDRs		Not Past Due or Impaired		Total		Net Charge Offs (Recoveries)

Commercial, financial and agricultural	$	14,804	$	3,753	$	18,136	$	310,059	$	28,203	$	25,374,994	$	25,749,949	$	13,320
Real estate – construction	12,293		70		1,560		5,381		101		2,254,134		2,273,539		(115		)
Commercial real estate – mortgage	10,473		3,270		927		111,982		4,155		11,593,351		11,724,158		417
Residential real estate – mortgage	69,474		34,440		8,572		173,843		64,898		13,014,520		13,365,747		290
Equity lines of credit	10,956		7,556		2,259		34,021		237		2,598,076		2,653,105		871
Equity loans	4,170		657		995		11,559		30,105		315,778		363,264		87
Credit card	6,710		4,804		11,929		—		—		616,074		639,517		9,048
Consumer – direct	19,766		7,020		6,712		2,425		534		1,653,926		1,690,383		19,551
Consumer – indirect	92,017		26,460		7,288		9,595		—		3,028,746		3,164,106		21,725
Covered loans	—		—		—		—		—		—		—		—
Total loans	$	240,663	$	88,030	$	58,378	$	658,865	$	128,233	$	60,449,599	$	61,623,768	$	65,194
Loans held for sale	$	—	$	—	$	—	$	—	$	—	$	67,110	$	67,110	$	—



	At or Quarter Ended September 30, 2017
	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due		Nonaccrual		Accruing TDRs		Not Past Due or Impaired		Total		Net Charge Offs (Recoveries)

Commercial, financial and agricultural	$	51,581	$	6,351	$	6,072	$	324,071	$	1,259	$	24,702,608	$	25,091,942	$	14,695
Real estate – construction	661		94		2,955		1,877		106		2,241,451		2,247,144		(29		)
Commercial real estate – mortgage	21,324		1,089		3,686		108,040		4,645		11,203,594		11,342,378		7,707
Residential real estate – mortgage	57,582		32,606		2,558		175,490		59,086		13,071,181		13,398,503		1,717
Equity lines of credit	11,118		4,824		2,179		34,416		237		2,564,538		2,617,312		179
Equity loans	3,470		1,798		840		11,305		30,574		335,389		383,376		(7		)
Credit card	6,832		4,777		10,692		—		—		568,674		590,975		10,591
Consumer – direct	17,563		6,796		5,209		2,746		577		1,571,505		1,604,396		18,281
Consumer – indirect	81,534		23,070		8,858		8,867		—		2,916,849		3,039,178		18,133
Covered loans	—		—		—		—		—		—		—		—
Total loans	$	251,665	$	81,405	$	43,049	$	666,812	$	96,484	$	59,175,789	$	60,315,204	$	71,267
Loans held for sale	$	—	$	—	$	—	$	—	$	—	$	77,783	$	77,783	$	—



	At or Quarter Ended June 30, 2017
	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due		Nonaccrual		Accruing TDRs		Not Past Due or Impaired		Total		Net Charge Offs (Recoveries)

Commercial, financial and agricultural	$	32,398	$	6,532	$	4,770	$	448,565	$	766	$	24,117,488	$	24,610,519	$	20,047
Real estate – construction	4,829		474		2,251		1,993		110		2,279,166		2,288,823		(797		)
Commercial real estate – mortgage	8,966		10,138		3,617		117,893		4,725		11,375,494		11,520,833		(1,386		)
Residential real estate – mortgage	54,911		31,227		3,043		141,482		59,490		12,789,171		13,079,324		1,404
Equity lines of credit	8,560		4,933		1,630		29,347		236		2,535,194		2,579,900		795
Equity loans	4,109		1,202		320		11,015		32,110		346,093		394,849		209
Credit card	5,446		4,015		11,738		—		—		555,621		576,820		10,678
Consumer – direct	16,134		6,032		4,187		706		620		1,419,967		1,447,646		16,899
Consumer – indirect	75,605		18,189		5,681		8,964		—		2,952,843		3,061,282		14,590
Covered loans	3,438		308		22,197		348		—		294,873		321,164		—
Total loans	$	214,396	$	83,050	$	59,434	$	760,313	$	98,057	$	58,665,910	$	59,881,160	$	62,439
Loans held for sale	$	—	$	—	$	—	$	—	$	—	$	74,558	$	74,558	$	—



	At or Quarter Ended March 31, 2017
	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due		Nonaccrual		Accruing TDRs		Not Past Due or Impaired		Total		Net Charge Offs (Recoveries)

Commercial, financial and agricultural	$	22,472	$	11,804	$	4,405	$	540,407	$	31,644	$	24,049,936	$	24,660,668	$	39,411
Real estate – construction	487		25		3,640		1,028		114		2,222,111		2,227,405		(57		)
Commercial real estate – mortgage	13,872		1,226		4,602		89,908		4,821		11,284,392		11,398,821		(741		)
Residential real estate – mortgage	61,234		22,337		2,653		140,342		58,867		12,832,343		13,117,776		1,195
Equity lines of credit	9,144		3,619		1,478		32,675		—		2,513,579		2,560,495		1,166
Equity loans	5,105		1,592		376		12,626		33,635		367,028		420,362		848
Credit card	6,262		4,719		12,453		—		—		546,877		570,311		9,818
Consumer – direct	12,025		4,866		4,874		637		662		1,306,178		1,329,242		16,818
Consumer – indirect	68,851		16,161		7,463		7,955		—		2,978,318		3,078,748		15,899
Covered loans	6,448		3,479		23,673		410		—		307,929		341,939		(31		)
Total loans	$	205,900	$	69,828	$	65,617	$	825,988	$	129,743	$	58,408,691	$	59,705,767	$	84,326
Loans held for sale	$	—	$	—	$	—	$	—	$	—	$	74,741	$	74,741	$	—



	At or Quarter Ended December 31, 2016
	30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due		Nonaccrual		Accruing TDRs		Not Past Due or Impaired		Total		Net Charge Offs (Recoveries)

Commercial, financial and agricultural	$	23,788	$	6,581	$	2,891	$	596,454	$	8,726	$	24,483,562	$	25,122,002	$	14,413
Real estate – construction	918		50		2,007		1,239		2,393		2,118,709		2,125,316		(383		)
Commercial real estate – mortgage	3,791		3,474		—		71,921		4,860		11,126,614		11,210,660		280
Residential real estate – mortgage	57,359		28,450		3,356		140,303		59,893		12,970,633		13,259,994		1,044
Equity lines of credit	7,922		4,583		2,950		33,453		—		2,494,870		2,543,778		641
Equity loans	5,615		1,843		467		13,635		34,746		389,403		445,709		512
Credit card	6,411		5,042		10,954		—		—		582,474		604,881		9,680
Consumer – direct	13,338		4,563		4,482		789		704		1,230,765		1,254,641		15,343
Consumer – indirect	85,198		22,833		7,197		5,926		—		3,013,794		3,134,948		19,902
Covered loans	7,311		1,351		27,238		730		—		322,704		359,334		(81		)
Total loans	$	211,651	$	78,770	$	61,542	$	864,450	$	111,322	$	58,733,528	$	60,061,263	$	61,351
Loans held for sale	$	—	$	—	$	—	$	56,592	$	—	$	105,257	$	161,849	$	—

BBVA COMPASS BANCSHARES, INC. BALANCE SHEET (Unaudited) (In Thousands)

	2017												2016
	December 31			September 30			June 30			March 31			December 31
Assets:
Cash and due from banks	$	1,313,022		$	1,145,745		$	1,073,646		$	1,093,797		$	1,284,261
Interest bearing funds with the Federal Reserve	2,683,769			2,400,533			2,120,285			2,669,135			1,830,078
Federal funds sold, securities purchased under agreements to resell and interest bearing deposits	86,035			188,380			182,215			197,000			137,447
Cash and cash equivalents	4,082,826			3,734,658			3,376,146			3,959,932			3,251,786
Trading account assets	220,496			572,104			2,651,083			2,892,254			3,144,600
Investment securities available for sale	12,683,787			12,268,309			12,142,844			11,846,618			11,665,055
Investment securities held to maturity	1,046,093			1,077,372			1,143,171			1,158,785			1,203,217
Loans held for sale	67,110			77,783			74,558			74,741			161,849
Loans	61,623,768			60,315,204			59,881,160			59,705,767			60,061,263
Allowance for loan losses	(842,760		)	(849,119		)	(816,952		)	(834,106		)	(838,293		)
Net loans	60,781,008			59,466,085			59,064,208			58,871,661			59,222,970
Premises and equipment, net	1,214,874			1,226,747			1,253,516			1,273,226			1,300,054
Bank owned life insurance	722,596			720,693			718,938			715,883			711,939
Goodwill	4,983,296			4,983,296			4,983,296			4,983,296			4,983,296
Other assets	1,518,493			1,556,613			1,596,159			1,532,837			1,435,187
Total assets	$	87,320,579		$	85,683,660		$	87,003,919		$	87,309,233		$	87,079,953
Liabilities:
Deposits:
Noninterest bearing	$	21,630,694		$	21,094,235		$	21,000,630		$	21,476,890		$	20,332,792
Interest bearing	47,625,619			46,119,332			44,616,750			46,052,748			46,946,741
Total deposits	69,256,313			67,213,567			65,617,380			67,529,638			67,279,533
FHLB and other borrowings	3,959,930			3,956,041			4,789,494			2,993,222			3,001,551
Federal funds purchased and securities sold under agreements to repurchase	19,591			44,761			31,619			71,559			39,052
Other short-term borrowings	17,996			327,539			2,435,260			2,642,539			2,802,977
Accrued expenses and other liabilities	1,053,439			1,025,849			1,140,536			1,186,776			1,206,133
Total liabilities	74,307,269			72,567,757			74,014,289			74,423,734			74,329,246
Shareholder’s Equity:
Preferred Stock	229,475			229,475			229,475			229,475			229,475
Common stock — $0.01 par value	2,230			2,230			2,230			2,230			2,230
Surplus	14,818,608			14,912,412			14,916,198			14,982,125			14,985,673
Retained deficit	(1,868,659		)	(1,920,184		)	(2,050,051		)	(2,207,060		)	(2,327,440		)
Accumulated other comprehensive loss	(197,405		)	(137,583		)	(137,131		)	(150,781		)	(168,252		)
Total BBVA Compass Bancshares, Inc. shareholder’s equity	12,984,249			13,086,350			12,960,721			12,855,989			12,721,686
Noncontrolling interests	29,061			29,553			28,909			29,510			29,021
Total shareholder’s equity	13,013,310			13,115,903			12,989,630			12,885,499			12,750,707
Total liabilities and shareholder’s equity	$	87,320,579		$	85,683,660		$	87,003,919		$	87,309,233		$	87,079,953

BBVA COMPASS BANCSHARES INCOME STATEMENTS (Unaudited) (In Thousands)

	Three Months Ended
	2017								2016
	December 31		September 30		June 30		March 31		December 31
Interest income:
Interest and fees on loans	$	641,322	$	623,884	$	607,375	$	574,712	$	558,680
Interest on investment securities available for sale	60,317		53,930		55,590		54,878		60,868
Interest on investment securities held to maturity	6,555		6,994		6,821		6,639		6,664
Interest on federal funds sold, securities purchased under agreements to resell and interest bearing deposits	7,409		11,557		12,049		9,262		7,664
Interest on trading account assets	1,005		6,247		9,805		10,297		13,150
Total interest income	716,608		702,612		691,640		655,788		647,026
Interest expense:
Interest on deposits	88,016		75,083		65,914		70,304		73,846
Interest on FHLB and other borrowings	22,392		29,904		22,450		19,068		23,825
Interest on federal funds purchased and securities sold under agreements to repurchase	464		4,623		6,942		4,897		4,640
Interest on other short-term borrowings	2,191		3,641		10,506		10,086		12,963
Total interest expense	113,063		113,251		105,812		104,355		115,274
Net interest income	603,545		589,361		585,828		551,433		531,752
Provision for loan losses	58,835		103,434		45,285		80,139		37,564
Net interest income after provision for loan losses	544,710		485,927		540,543		471,294		494,188
Noninterest income:
Service charges on deposit accounts	56,070		55,953		54,919		55,168		55,901
Card and merchant processing fees	33,380		32,297		32,460		29,992		31,161
Retail investment sales	26,338		26,817		28,588		27,471		23,293
Investment banking and advisory fees	24,957		30,500		19,943		28,301		20,792
Money transfer income	24,101		24,881		27,330		25,197		28,632
Asset management fees	10,303		10,336		10,055		9,771		8,906
Corporate and correspondent investment sales	11,803		5,145		12,189		8,915		3,199
Mortgage banking income	4,720		3,450		3,316		2,870		16,086
Bank owned life insurance	4,397		4,322		4,220		4,169		4,202
Investment securities gains, net	—		3,033		—		—		—
Loss on prepayment of FHLB and other borrowings	—		—		—		—		(295		)
Other	101,100		61,060		53,305		52,833		68,881
Total noninterest income	297,169		257,794		246,325		244,687		260,758
Noninterest expense:
Salaries, benefits and commissions	296,146		279,384		288,426		268,015		283,609
Professional services	76,068		64,775		64,840		57,807		63,810
Equipment	63,200		60,656		62,405		61,630		62,627
Net occupancy	41,125		42,227		41,240		42,101		40,116
Money transfer expense	15,721		15,938		17,807		16,324		17,426
Marketing	7,950		14,996		15,729		13,545		13,018
Communications	4,970		5,084		5,281		5,219		5,406
Goodwill impairment	—		—		—		—		59,901
Other	110,648		90,902		76,757		84,671		68,157
Total noninterest expense	615,828		573,962		572,485		549,312		614,070
Net income before income tax expense	226,051		169,759		214,383		166,669		140,876
Income tax expense	173,979		39,308		56,943		45,846		51,473
Net income	52,072		130,451		157,440		120,823		89,403
Less: net income attributable to noncontrolling interests	547		584		431		443		441
Net income attributable to BBVA Compass Bancshares, Inc.	$	51,525	$	129,867	$	157,009	$	120,380	$	88,962

BBVA USA Bancshares, Inc. - FORM 8-K - EX-99.1 - EXHIBIT 99.1 - February 1, 2018

Attached files

BBVA USA Bancshares, Inc. Reports