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

Attached files

file	filename
8-K - 8-K - BBVA USA Bancshares, Inc.	bbvacompass123120188k.htm

Exhibit 99.1

February 1, 2019

BBVA Compass reports fourth quarter results


•	Fourth quarter net income of $196 million brings full-year total to a record $763 million


◦	Net income up 13 percent¹ from a year ago and 31 percent¹ on a year-to-date basis after adjusting for a $121 million non-cash charge in the fourth quarter of 2017 related to the revaluation of net deferred tax assets mandated by the Tax Cuts and Jobs Act.


◦	Return on average assets and return on average tangible equity² for the quarter were 0.85 percent and 9.27 percent, respectively


•	Total revenue reaches all-time high; up 6 percent from prior year levels and 9 percent on a year-to-date basis


◦	Net interest income increases $79 million or 13 percent from year ago levels and $276 million or 12 percent on a year-to-date basis


◦	Percent net interest margin (FTE) up 15 basis points from year ago quarter, 10 basis points from third quarter 2018 levels and 20 basis points for the full-year of 2018


•	Noninterest expense growth well contained at 2 percent in 2018, including a 2 percent decrease in the fourth quarter of 2018


•	Revenue growth coupled with strong focus on expense management results in record operating income² of $351 million in the quarter and $1.3 billion for the year, both represent a 23 percent increase


•	Balance sheet activity supported by solid loan and deposit generation


◦	Total loans rise to $65.3 billion, up 6 percent year-over-year


◦	Newly funded customer loans of $5.6 billion in the quarter bring full-year total to a record $21.7 billion in 2018, up 18 percent from the prior year


◦	Total deposits of $72.2 billion, up 4 percent from a year ago levels


•	Credit quality metrics remain sound; allowance to loan ratio steady at 1.36 percent


◦	Nonperforming loan ratio ended the year at 1.24 percent


◦	Net charge-off ratio for 2018 at 51 basis points compared to 47 basis points in 2017


◦	Provision expense for the year exceeded net charge-offs by more than $42 million

BBVA Compass Bancshares, Inc., a Sunbelt-based bank holding company (BBVA Compass), reported today net income of $196 million for the fourth quarter of 2018, a 276 percent increase from the $52 million earned during the fourth quarter of 2017. 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, the year-over-year increase in net income for the fourth quarter of 2018 compared to adjusted net income¹ of $173 million for the fourth quarter of 2017 was 13 percent.

Net income for the full-year 2018 totaled $763 million, an increase of 66 percent from the $461 million earned during the full-year of 2017. Excluding the impact of the non-cash charge, the year-over-year increase in net income for the full-year of 2018 compared to adjusted net income¹ of $582 million for the full-year of 2017 was 31 percent. The following table summarizes year-over-year comparisons on a reported and adjusted basis for certain key performance measures.



Impact of Tax Cuts and Jobs Act
Dollars in thousands (unaudited)
									Full Year
	4Q18			4Q17			% Change		2018			2017			% Change
Net Income:
As reported	$	195,826		$	52,072		276	%	$	763,429		$	460,786		66	%
Adjusted¹	195,826			173,315			13		763,429			582,029			31

ROA:
As reported	0.85		%	0.24		%			0.85		%	0.53		%
Adjusted¹	0.85			0.79					0.85			0.67

ROTE:¹
As reported	9.27		%	2.55		%			9.28		%	5.77		%
Adjusted	9.27			8.48					9.28			7.28

“In 2018 BBVA Compass delivered record performance in many key financial metrics including new loan originations, total revenue, operating income and net income,” said Javier Rodríguez Soler, incoming president and CEO of BBVA Compass. “Equally important, this performance was accomplished while making great strides in our digital transformation efforts designed to drive new industry-leading product offerings, increase our digital sales capabilities and improve the customer experience. As we enter 2019 against a backdrop of economic uncertainty, we are confident that our vision and the culture we have instilled in our team members that empowers them to move our transformation forward will serve us well during various business cycles.”

Total revenue for the quarter was a record $953 million, an increase of 6 percent from fourth quarter 2017 levels. For the full-year 2018, total revenue was $3.7 billion (also a record), an increase of 9 percent from $3.4 billion in 2017. Fueling the growth was net interest income which totaled $682 million, up 13 percent from the fourth quarter of 2017 and 15 percent (annualized) on a linked quarter basis. The percent net interest margin in the fourth quarter was 3.37 percent, up 15 basis points from the fourth quarter of 2017 and 10 basis points from the third quarter of 2018. On a full-year basis, the percent net interest margin was 3.30 percent in 2018, an increase of 20 basis points from the comparable period in 2017.

Noninterest income for the quarter totaled $271 million, down 9 percent compared to the $297 million recorded in the fourth quarter of 2017. For the full-year of 2018, noninterest income totaled $1.1 billion, up 1 percent from prior year levels as several of our major fee-based businesses recorded positive performances. Particularly noteworthy were card and merchant processing fees (+37 percent), corporate and correspondent investment sales (+36 percent) and mortgage banking income (+87 percent). Conversely, weaker demand and economic conditions impacted investment banking and advisory fees (-25 percent) and money transfer income (-10 percent). Other income also recorded a decline in the quarter and for the year due in part to a decrease in syndication fees and other miscellaneous fees coupled with certain interchange fees being reclassified to card and merchant processing fees in 2018.

Overall expense growth was well contained as noninterest expense totaled $602 million, down 2 percent compared to the prior

year quarter, and for the full-year of 2018 was up 2 percent. Revenue growth combined with the strong focus on expense management resulted in record operating income² of $351 million in the quarter and $1.3 billion for the year, both represent a 23 percent increase over the respective prior year period.

Total loans at the end of the fourth quarter of 2018 were $65.3 billion, an increase of 6 percent from the $61.7 billion at the end of the fourth quarter of 2017.

“Loan production was brisk throughout our network as we funded a record $21.7 billion in customer loans during the year, an 18 percent increase over the prior year,” said Rodríguez Soler. “This enabled us to offset increased payoff activity as total commercial loans increased 5 percent in the aggregate, led by an 11 percent increase in commercial mortgages, while double-digit increases in credit cards, direct consumer lending and indirect auto lending resulted in an 8 percent increase in our consumer loan portfolio.”

Total deposits at the end of the fourth quarter of 2018 were $72.2 billion, a 4 percent increase from the $69.3 billion at the end of the fourth quarter of 2017. The loan to deposit ratio ended the quarter at 90 percent, up slightly from 89 percent a year ago.

“The overall health of our loan portfolio remains strong,” noted Rodríguez Soler. “And we are steadfast in our commitment to maintaining sound underwriting standards and reserve levels that adequately reflect the make-up of our loan portfolio, as well as economic conditions.”

Nonperforming loans as a percentage of total loans ended the year at 1.24 percent compared to 1.04 percent at the end of the third quarter of 2018 and 1.16 percent at the end of 2017. The uptick in nonperforming loans during the quarter was primarily due to three, unrelated commercial credits being placed on nonaccrual status. Net charge-offs as a percentage of average loans were 51 basis points for the full-year of 2018 compared to 47 basis points for the full-year of 2017. Provision expense for the year exceeded net charge-offs by more than $42 million while the allowance for loan losses as a percentage of total loans ended the year at 1.36 percent, relatively unchanged from prior year levels. Equally important, the coverage ratio of nonperforming loans at the end of the fourth quarter of 2018 was 109 percent compared to 117 percent at the end of the fourth quarter of 2017.

Total shareholder's equity at the end of the fourth quarter totaled $13.5 billion, a 4 percent increase from $13.0 billion at the end of the fourth quarter of 2017. The CET1 ratio stood at 12.00 percent³ at the end of the fourth quarter of 2018, up 20 basis points from the end of the fourth quarter of 2017. All of BBVA Compass’ regulatory capital ratios³ continue to 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 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 Return on average tangible equity and operating income are non-GAAP financial measures that we believe aid in understanding certain areas of our performance. The calculation of these measures is included on the page titled Non-GAAP Reconciliation.

³ Regulatory capital ratios at December 31, 2018, are estimated.

FTE - fully taxable equivalent



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 644 branches, including 331 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 8th nationally in terms of dollar volume of SBA loans originated in fiscal year 2018. 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.

On April 5, 2018, BBVA filed its annual report on Form 20-F for the year ended December 31, 2017, with the U.S. Securities and Exchange Commission. A copy can be accessed on the BBVA website at https://shareholdersandinvestors.bbva.com/the-share/adrs-english/. Holders of BBVA’s American Depositary Receipts (ADRs) may request a hard copy of the Form 20-F for the year ended December 31, 2017, including complete audited financial statements, free of charge. To request a copy, contact Ed Bilek at ed.bilek@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 February 28, 2018, as updated by our subsequent SEC filings.

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

	Three Months Ended December 31,						%		Years Ended December 31,						%
	2018			2017			Change		2018			2017			Change
EARNINGS SUMMARY
Net interest income	$	682,188		$	603,545		13		$	2,606,578		$	2,330,167		12
Noninterest income [a]	270,606			297,169			(9	)	1,056,909			1,042,942			1
Total revenue [a]	952,794			900,714			6		3,663,487			3,373,109			9
Investment securities gain, net	—			—			—		—			3,033			(100	)
Provision for loan losses	122,147			58,835			108		365,420			287,693			27
Noninterest expense	601,992			615,828			(2	)	2,349,960			2,311,587			2
Pretax income	228,655			226,051			1		948,107			776,862			22
Income tax expense	32,829			173,979			(81	)	184,678			316,076			(42	)
Net income	$	195,826		$	52,072		276		$	763,429		$	460,786		66
Adjusted net income [b]	$	195,826		$	173,315		13		$	763,429		$	582,029		31

SELECTED RATIOS
Return on average assets	0.85		%	0.24		%			0.85		%	0.53		%
Return on average assets- adjusted [b]	0.85			0.79					0.85			0.67
Return on average tangible equity [b]	9.27			2.55					9.28			5.77
Return on average tangible equity- adjusted [b]	9.27			8.48					9.28			7.28
Average common equity to average assets	14.41			14.82					14.52			14.63
Average loans to average total deposits	91.88			89.96					90.89			90.68
Common equity tier 1 capital (CET1) [c]	12.00			11.80					12.00			11.80
Tier I capital ratio [c]	12.33			12.15					12.33			12.15
Total capital ratio [c]	14.49			14.36					14.49			14.36
Leverage ratio [c]	10.03			9.98					10.03			9.98
[a] Excludes net gain on sales of investment securities.
[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,				%
	2018		2017		Change		2018		2017		Change	2018		2017		Change
BALANCE SHEET HIGHLIGHTS
Total loans	$	65,287,838	$	61,170,130	7		$	63,761,869	$	60,419,711	6	$	65,255,320	$	61,690,878	6
Total debt securities	13,614,503		13,104,177		4		13,406,533		12,776,615		5	13,866,829		13,265,725		5
Earning assets	81,661,049		77,204,217		6		80,237,817		77,745,063		3	81,831,522		78,359,040		4
Total assets	91,337,365		86,990,170		5		89,576,037		87,358,298		3	90,947,174		87,320,579		4
Noninterest bearing demand deposits	20,825,633		21,389,000		(3	)	21,167,441		21,039,822		1	20,183,876		21,630,694		(7	)
Interest bearing transaction accounts	34,783,054		33,059,701		5		34,197,814		32,783,151		4	36,277,316		33,743,887		8
Total transaction accounts	55,608,687		54,448,701		2		55,365,255		53,822,973		3	56,461,192		55,374,581		2
Total deposits	71,057,556		67,994,615		5		70,149,887		66,627,368		5	72,167,987		69,256,313		4
Shareholder's equity	13,420,931		13,150,577		2		13,266,930		13,035,797		2	13,512,529		13,013,310		4

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

	2018												2017
	December 31			September 30			June 30			March 31			December 31
NONPERFORMING ASSETS
Nonaccrual loans [a]	$	751,486		$	628,159		$	662,991		$	647,210		$	658,865
Loans 90 days or more past due [b]	59,549			44,765			39,143			45,904			58,378
TDRs 90 days or more past due	411			444			491			700			751
Total nonperforming loans [a]	811,446			673,368			702,625			693,814			717,994
Other real estate owned, net (OREO)	16,869			18,706			16,499			16,147			17,278
Other repossessed assets	12,031			9,875			13,117			11,278			13,473
Total nonperforming assets	$	840,346		$	701,949		$	732,241		$	721,239		$	748,745

TDRs accruing and past due less than 90 days	$	109,190		$	92,606		$	99,251		$	101,285		$	100,492


Total nonperforming loans as a % of loans	1.24		%	1.04		%	1.11		%	1.11		%	1.16		%
Total nonperforming assets as a % of total loans, other real estate, and other repossessed assets	1.29			1.09			1.16			1.16			1.21
[a] Includes loans held for sale.
[b] Excludes loans classified as troubled debt restructurings (TDRs).



	Three Months Ended
	2018												2017
	December 31			September 30			June 30			March 31			December 31
ALLOWANCE FOR LOAN LOSSES
Balance at beginning of period	$	875,393		$	860,000		$	832,071		$	842,760		$	849,119
Net charge-offs (NCO)	112,298			79,571			63,351			67,718			65,194
Provision for loan losses	122,147			94,964			91,280			57,029			58,835
Balance at end of period	$	885,242		$	875,393		$	860,000		$	832,071		$	842,760

Allowance for loan losses as a % of total loans	1.36		%	1.36		%	1.36		%	1.34		%	1.37		%
Allowance for loan losses as a % of nonperforming loans [c]	109.09			130.00			122.40			119.93			117.38
Allowance for loan losses as a % of nonperforming assets [c]	105.34			124.71			117.45			115.37			112.56

Annualized as a % of average loans:
NCO - QTD	0.68			0.49			0.40			0.44			0.42
NCO - YTD	0.51			0.45			0.42			0.44			0.47
[c] Includes loans held for sale that are on nonaccrual status.

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

	Three Months Ended December 31,
	2018							2017
	Average Balance			Income/Expense		Yield/ Rate		Average Balance			Income/ Expense		Yield/Rate
YIELD/RATE ANALYSIS
(Taxable Equivalent Basis)
Assets
Earning assets:
Loans	$	65,287,838		$	799,829	4.86	%	$	61,170,130		$	661,873	4.29	%
Debt securities available for sale [a]	11,186,986			59,029		2.09		12,192,516			56,890		1.85
Debt securities held to maturity	2,740,315			21,376		3.09		1,056,906			9,508		3.57
Other earning assets [b]	2,758,708			20,044		2.88		2,929,910			11,849		1.60
Total earning assets [a]	81,973,847			900,278		4.36		77,349,462			740,120		3.80
Allowance for loan losses	(886,426		)					(853,546		)
Unrealized loss on debt securities available for sale	(312,798		)					(145,245		)
Other assets	10,562,742							10,639,499
Total assets	$	91,337,365						$	86,990,170

Liabilities and Shareholders' Equity
Interest bearing liabilities:
Interest bearing demand deposits	$	7,963,379		$	15,349	0.76		$	7,843,974		$	7,995	0.40
Savings and money market accounts	26,819,675			72,530		1.07		25,215,727			34,463		0.54
Certificates and other time deposits	15,448,869			75,843		1.95		13,545,914			45,558		1.33
Total interest bearing deposits	50,231,923			163,722		1.29		46,605,615			88,016		0.75
FHLB and other borrowings	4,664,076			36,573		3.11		3,551,958			22,392		2.50
Federal funds purchased and securities sold under agreement to repurchase [b]	138,953			3,849		10.99		40,666			464		4.53
Other short-term borrowings	65,994			591		3.55		114,140			2,191		7.62
Total interest bearing liabilities	55,100,946			204,735		1.47		50,312,379			113,063		0.89
Noninterest bearing deposits	20,825,633							21,389,000
Other noninterest bearing liabilities	1,989,855							2,138,214
Total liabilities	77,916,434							73,839,593
Shareholder's equity	13,420,931							13,150,577
Total liabilities and shareholder's equity	$	91,337,365						$	86,990,170

Net interest income/ net interest spread				695,543		2.89	%				627,057		2.91	%
Net yield on earning assets						3.37	%						3.22	%

Total taxable equivalent adjustment				13,355							23,512

Net interest income				$	682,188						$	603,545
[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,
	2018							2017
	Average Balance			Income/ Expense		Yield/ Rate		Average Balance			Income/ Expense		Yield/ Rate
YIELD/RATE ANALYSIS
(Taxable Equivalent Basis)
Assets
Earning assets:
Loans	$	63,761,869		$	2,960,170	4.64	%	$	60,419,711		$	2,521,613	4.17	%
Debt securities available for sale [a]	11,390,313			222,627		1.95		11,769,440			212,730		1.81
Debt securities held to maturity	2,298,737			67,347		2.93		1,120,472			39,128		3.49
Other earning assets [b]	3,069,415			66,792		2.18		4,548,737			79,712		1.75
Total earning assets [a]	80,520,334			3,316,936		4.12		77,858,360			2,853,183		3.66
Allowance for loan losses	(859,475		)					(840,359		)
Unrealized loss on debt securities available for sale	(282,517		)					(113,297		)
Other assets	10,197,695							10,453,594
Total assets	$	89,576,037						$	87,358,298

Liabilities and Shareholders' Equity
Interest bearing liabilities:
Interest bearing demand deposits	$	7,950,561		48,599		0.61		$	7,858,504		27,206		0.35
Savings and money market accounts	26,247,253			224,009		0.85		24,924,647			107,106		0.43
Certificates and other time deposits	14,784,632			244,682		1.65		12,804,395			165,005		1.29
Total interest bearing deposits	48,982,446			517,290		1.06		45,587,546			299,317		0.66
FHLB and other borrowings	4,095,054			130,372		3.18		3,973,465			93,814		2.36
Federal funds purchased and securities sold under agreement to repurchase [b]	109,852			8,953		8.15		58,624			16,926		28.87
Other short-term borrowings	68,423			2,081		3.04		1,703,738			26,424		1.55
Total interest bearing liabilities	53,255,775			658,696		1.24		51,323,373			436,481		0.85
Noninterest bearing deposits	21,167,441							21,039,822
Other noninterest bearing liabilities	1,885,891							1,959,306
Total liabilities	76,309,107							74,322,501
Shareholder's equity	13,266,930							13,035,797
Total liabilities and shareholder's equity	$	89,576,037						$	87,358,298

Net interest income/ net interest spread				2,658,240		2.88	%				2,416,702		2.81	%
Net yield on earning assets						3.30	%						3.10	%

Total taxable equivalent adjustment				51,662							86,535

Net interest income				$	2,606,578						$	2,330,167
[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,				%		2018								2017
	2018		2017		Change		December 31		September 30		June 30		March 31		December 31
NONINTEREST INCOME
Service charges on deposit accounts	$	236,673	$	222,110	7		$	61,606	$	60,325	$	58,581	$	56,161	$	56,070
Card and merchant processing fees	174,927		128,129		37		46,982		44,219		44,048		39,678		33,380
Retail investment sales	112,652		109,214		3		24,476		28,286		29,782		30,108		26,338
Investment banking and advisory fees	77,684		103,701		(25	)	15,286		13,956		24,546		23,896		24,957
Money transfer income	91,681		101,509		(10	)	23,632		23,441		23,920		20,688		24,101
Asset management fees	43,811		40,465		8		10,909		11,143		10,989		10,770		10,303
Corporate and correspondent investment sales	51,675		38,052		36		10,774		12,490		16,355		12,056		11,803
Mortgage banking income	26,833		14,356		87		3,755		6,717		7,964		8,397		4,720
Bank owned life insurance	17,822		17,108		4		4,635		4,597		4,375		4,215		4,397
Other	223,151		268,298		(17	)	68,551		53,285		49,459		51,856		101,100
	1,056,909		1,042,942		1		270,606		258,459		270,019		257,825		297,169
Investment securities gains, net	—		3,033		(100	)	—		—		—		—		—
Total noninterest income	$	1,056,909	$	1,045,975	1		$	270,606	$	258,459	$	270,019	$	257,825	$	297,169

NONINTEREST EXPENSE
Salaries, benefits and commissions	$	1,154,791	$	1,131,971	2		$	285,820	$	292,679	$	286,852	$	289,440	$	296,146
Professional services	277,154		263,490		5		79,529		68,403		68,577		60,645		76,068
Equipment	257,565		247,891		4		66,806		63,739		63,660		63,360		63,200
Net occupancy	166,768		166,693		—		41,161		42,514		42,671		40,422		41,125
Money transfer expense	62,138		65,790		(6	)	15,995		16,120		16,302		13,721		15,721
Marketing	48,866		52,220		(6	)	15,884		12,381		11,814		8,787		7,950
Communications	30,582		20,554		49		9,241		10,827		5,251		5,263		4,970
Other	352,096		362,978		(3	)	87,556		98,847		84,418		81,275		110,648
Total noninterest expense	$	2,349,960	$	2,311,587	2		$	601,992	$	605,510	$	579,545	$	562,913	$	615,828

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

	Three Months Ended December 31,						Years Ended December 31,
	2018			2017			2018			2017
NON-GAAP RECONCILIATION

Computation of Operating Income:
Net interest income (GAAP)	$	682,188		$	603,545		$	2,606,578		$	2,330,167
Plus: noninterest income (GAAP)	270,606			297,169			1,056,909			1,045,975
Less: noninterest expense (GAAP)	601,992			615,828			2,349,960			2,311,587
Plus: goodwill impairment (GAAP)	—			—			—			—
Operating income (non-GAAP)	$	350,802		$	284,886		$	1,313,527		$	1,064,555


Computation of Average Tangible Equity:
Total stockholder's equity (average) (GAAP)	$	13,420,931		13,150,577			$	13,266,930		13,035,797
Less: Goodwill and other intangibles (average) (GAAP)	5,039,847			5,039,014			5,039,974			5,043,805
Average tangible equity (non-GAAP) [B]	$	8,381,084		8,111,563			$	8,226,956		7,991,992
Net income (GAAP) [A]	$	195,826		52,072			$	763,429		460,786
Return on average tangible equity (non-GAAP) ([A]/[B], annualized)	9.27		%	2.55		%	9.28		%	5.77		%

Computation of Adjusted Net Income, Return on Average Assets and Return on Average Tangible Equity:
Net income (GAAP)	$	195,826		$	52,072		$	763,429		$	460,786
Plus: Revaluation of net deferred tax assets (GAAP)	—			121,243			—			121,243
Adjusted net income (non-GAAP) [C]	$	195,826		173,315			763,429			582,029
Average assets (GAAP) [D]	91,337,365			86,990,170			89,576,037			87,358,298
Return on average assets - adjusted (non-GAAP) ([C]/[D], annualized)	0.85		%	0.79		%	0.85		%	0.67		%
Return on average tangible equity - adjusted (non-GAAP) ([C]/[B], annualized)	9.27			8.48			9.28			7.28

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

	At or Quarter Ended December 31, 2018
	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	$	17,257	$	11,784	$	8,114	$	400,389	$	18,926	$	26,105,849	$	26,562,319	$	38,786
Real estate – construction	218		8,849		544		2,851		116		1,984,959		1,997,537		(24		)
Commercial real estate – mortgage	11,678		3,375		2,420		110,144		3,661		12,885,518		13,016,796		470
Residential real estate – mortgage	80,366		29,852		5,927		167,099		57,446		13,081,466		13,422,156		247
Equity lines of credit	14,007		5,109		2,226		37,702		—		2,688,173		2,747,217		(656		)
Equity loans	3,471		843		180		10,939		26,768		256,413		298,614		(35		)
Credit card	9,516		7,323		17,011		—		—		784,458		818,308		11,231
Consumer – direct	37,336		19,543		13,336		4,528		2,684		2,476,161		2,553,588		38,508
Consumer – indirect	100,434		32,172		9,791		17,834		—		3,609,788		3,770,019		23,771
Total loans	$	274,283	$	118,850	$	59,549	$	751,486	$	109,601	$	63,872,785	$	65,186,554	$	112,298
Loans held for sale	$	—	$	—	$	—	$	—	$	—	$	68,766	$	68,766	$	—



	At or Quarter Ended September 30, 2018
	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	$	38,512	$	16,416	$	9,609	$	290,239	$	522	$	26,300,781	$	26,656,079	$	13,975
Real estate – construction	3,252		5,278		532		12,882		121		2,096,427		2,118,492		(23		)
Commercial real estate – mortgage	31,792		18,349		502		104,976		3,753		12,237,632		12,397,004		2,035
Residential real estate – mortgage	87,426		30,373		3,697		159,721		59,082		13,062,173		13,402,472		2,090
Equity lines of credit	13,556		4,298		1,186		35,125		—		2,655,566		2,709,731		(19		)
Equity loans	2,082		1,042		241		10,378		28,383		266,712		308,838		45
Credit card	8,601		6,449		13,157		—		—		735,479		763,686		9,686
Consumer – direct	30,153		14,455		8,988		3,184		1,189		2,364,239		2,422,208		28,765
Consumer – indirect	86,310		23,587		6,853		11,654		—		3,550,365		3,678,769		23,017
Total loans	$	301,684	$	120,247	$	44,765	$	628,159	$	93,050	$	63,269,374	$	64,457,279	$	79,571
Loans held for sale	$	—	$	—	$	—	$	—	$	—	$	73,569	$	73,569	$	—



	At or Quarter Ended June 30, 2018
	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	$	55,116	$	12,405	$	3,597	$	323,287	$	5,722	$	26,248,260	$	26,648,387	$	10,567
Real estate – construction	579		163		540		13,289		125		2,115,565		2,130,261		287
Commercial real estate – mortgage	20,450		2,826		3,211		105,409		3,945		11,659,635		11,795,476		(5,505		)
Residential real estate – mortgage	76,693		27,972		5,026		162,892		59,940		13,017,967		13,350,490		1,558
Equity lines of credit	10,661		4,384		2,191		34,269		237		2,627,974		2,679,716		453
Equity loans	3,519		882		306		10,153		29,303		281,302		325,465		(443		)
Credit card	6,353		4,733		11,931		—		—		681,617		704,634		11,299
Consumer – direct	24,060		9,577		6,313		1,073		470		2,098,439		2,139,932		29,876
Consumer – indirect	79,600		22,616		6,028		12,619		—		3,395,753		3,516,616		15,259
Total loans	$	277,031	$	85,558	$	39,143	$	662,991	$	99,742	$	62,126,512	$	63,290,977	$	63,351
Loans held for sale	$	—	$	—	$	—	$	—	$	—	$	52,041	$	52,041	$	—



	At or Quarter Ended March 31, 2018
	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	$	15,427	$	12,230	$	5,420	$	284,699	$	5,231	$	26,036,120	$	26,359,127	$	8,395
Real estate – construction	450		240		1,918		14,183		129		2,139,936		2,156,856		(89		)
Commercial real estate – mortgage	8,552		3,220		2,229		115,285		4,182		11,394,819		11,528,287		114
Residential real estate – mortgage	73,335		33,993		5,975		169,778		62,171		12,961,735		13,306,987		1,380
Equity lines of credit	12,063		4,611		2,371		36,350		236		2,602,229		2,657,860		160
Equity loans	4,495		983		379		11,429		29,546		297,705		344,537		(69		)
Credit card	6,438		5,089		11,845		—		—		633,658		657,030		9,874
Consumer – direct	16,919		8,569		7,929		4,211		490		1,818,325		1,856,443		25,412
Consumer – indirect	77,153		21,092		7,838		11,275		—		3,223,376		3,340,734		22,541
Total loans	$	214,832	$	90,027	$	45,904	$	647,210	$	101,985	$	61,107,903	$	62,207,861	$	67,718
Loans held for sale	$	—	$	—	$	—	$	—	$	—	$	76,401	$	76,401	$	—



	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	$	1,213	$	25,401,984	$	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
Total loans	$	240,663	$	88,030	$	58,378	$	658,865	$	101,243	$	60,476,589	$	61,623,768	$	65,194
Loans held for sale	$	—	$	—	$	—	$	—	$	—	$	67,110	$	67,110	$	—

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

	2018												2017
	December 31			September 30			June 30			March 31			December 31
Assets:
Cash and due from banks	$	1,217,319		$	1,122,747		$	1,138,034		$	1,098,345		$	1,313,022
Federal funds sold, securities purchased under agreements to resell and interest bearing deposits	2,115,307			2,404,164			2,438,585			2,424,987			2,769,804
Cash and cash equivalents	3,332,626			3,526,911			3,576,619			3,523,332			4,082,826
Trading account assets	237,656			216,749			277,694			216,465			220,496
Debt securities available for sale	10,981,216			11,134,860			11,293,724			11,434,152			12,219,632
Debt securities held to maturity	2,885,613			2,490,568			2,198,186			1,975,729			1,046,093
Loans held for sale	68,766			73,569			52,041			76,401			67,110
Loans	65,186,554			64,457,279			63,290,977			62,207,861			61,623,768
Allowance for loan losses	(885,242		)	(875,393		)	(860,000		)	(832,071		)	(842,760		)
Net loans	64,301,312			63,581,886			62,430,977			61,375,790			60,781,008
Premises and equipment, net	1,152,958			1,155,795			1,170,798			1,189,253			1,214,874
Bank owned life insurance	736,171			731,527			728,703			724,600			722,596
Goodwill	4,983,296			4,983,296			4,983,296			4,983,296			4,983,296
Other assets	2,267,560			2,152,495			2,042,624			2,109,484			1,982,648
Total assets	$	90,947,174		$	90,047,656		$	88,754,662		$	87,608,502		$	87,320,579
Liabilities:
Deposits:
Noninterest bearing	$	20,183,876		$	20,968,391		$	21,433,218		$	21,792,498		$	21,630,694
Interest bearing	51,984,111			49,409,666			48,714,490			48,147,914			47,625,619
Total deposits	72,167,987			70,378,057			70,147,708			69,940,412			69,256,313
FHLB and other borrowings	3,987,590			5,045,302			4,157,284			3,322,940			3,959,930
Federal funds purchased and securities sold under agreements to repurchase	102,275			78,004			185,511			5,933			19,591
Other short-term borrowings	—			68,714			81,547			29,999			17,996
Accrued expenses and other liabilities	1,176,793			1,135,092			991,968			1,165,079			1,053,439
Total liabilities	77,434,645			76,705,169			75,564,018			74,464,363			74,307,269
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	14,545,849			14,695,197			14,699,773			14,814,744			14,818,608
Retained deficit	(1,107,198		)	(1,302,525		)	(1,476,614		)	(1,660,417		)	(1,868,659		)
Accumulated other comprehensive loss	(186,848		)	(311,422		)	(293,323		)	(271,431		)	(197,405		)
Total BBVA Compass Bancshares, Inc. shareholder’s equity	13,483,508			13,312,955			13,161,541			13,114,601			12,984,249
Noncontrolling interests	29,021			29,532			29,103			29,538			29,061
Total shareholder’s equity	13,512,529			13,342,487			13,190,644			13,144,139			13,013,310
Total liabilities and shareholder’s equity	$	90,947,174		$	90,047,656		$	88,754,662		$	87,608,502		$	87,320,579

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

	Three Months Ended
	2018								2017
	December 31		September 30		June 30		March 31		December 31
Interest income:
Interest and fees on loans	$	787,858	$	751,470	$	711,006	$	663,935	$	641,322
Interest on debt securities available for sale	59,028		53,201		53,792		56,602		56,883
Interest on debt securities held to maturity	19,993		16,110		13,062		12,426		6,555
Interest on trading account assets	704		833		924		750		1,005
Interest and dividends on other earning assets	19,340		17,449		14,916		11,875		10,843
Total interest income	886,923		839,063		793,700		745,588		716,608
Interest expense:
Interest on deposits	163,722		139,898		116,323		97,347		88,016
Interest on FHLB and other borrowings	36,573		37,131		31,912		24,756		22,392
Interest on federal funds purchased and securities sold under agreements to repurchase	3,849		3,169		1,399		536		464
Interest on other short-term borrowings	591		579		567		344		2,191
Total interest expense	204,735		180,777		150,201		122,983		113,063
Net interest income	682,188		658,286		643,499		622,605		603,545
Provision for loan losses	122,147		94,964		91,280		57,029		58,835
Net interest income after provision for loan losses	560,041		563,322		552,219		565,576		544,710
Noninterest income:
Service charges on deposit accounts	61,606		60,325		58,581		56,161		56,070
Card and merchant processing fees	46,982		44,219		44,048		39,678		33,380
Retail investment sales	24,476		28,286		29,782		30,108		26,338
Investment banking and advisory fees	15,286		13,956		24,546		23,896		24,957
Money transfer income	23,632		23,441		23,920		20,688		24,101
Asset management fees	10,909		11,143		10,989		10,770		10,303
Corporate and correspondent investment sales	10,774		12,490		16,355		12,056		11,803
Mortgage banking income	3,755		6,717		7,964		8,397		4,720
Bank owned life insurance	4,635		4,597		4,375		4,215		4,397
Other	68,551		53,285		49,459		51,856		101,100
Total noninterest income	270,606		258,459		270,019		257,825		297,169
Noninterest expense:
Salaries, benefits and commissions	285,820		292,679		286,852		289,440		296,146
Professional services	79,529		68,403		68,577		60,645		76,068
Equipment	66,806		63,739		63,660		63,360		63,200
Net occupancy	41,161		42,514		42,671		40,422		41,125
Money transfer expense	15,995		16,120		16,302		13,721		15,721
Marketing	15,884		12,381		11,814		8,787		7,950
Communications	9,241		10,827		5,251		5,263		4,970
Other	87,556		98,847		84,418		81,275		110,648
Total noninterest expense	601,992		605,510		579,545		562,913		615,828
Net income before income tax expense	228,655		216,271		242,693		260,488		226,051
Income tax expense	32,829		41,756		58,295		51,798		173,979
Net income	195,826		174,515		184,398		208,690		52,072
Less: net income attributable to noncontrolling interests	499		426		595		461		547
Net income attributable to BBVA Compass Bancshares, Inc.	$	195,327	$	174,089	$	183,803	$	208,229	$	51,525

BBVA USA Bancshares, Inc. - FORM 8-K - EX-99.1 - EXHIBIT 99.1 - February 1, 2019

Attached files

BBVA USA Bancshares, Inc. Reports