SYNOVUS FINANCIAL CORP - FORM 8-K - EX-99.2

Attached files

file	filename
EX-99.1 - EX-99.1 - SYNOVUS FINANCIAL CORP	snv063020208kex991fili.htm
EX-99.3 - EX-99.3 - SYNOVUS FINANCIAL CORP	snv_06302020x8kex993xfil.htm
8-K - 8-K - SYNOVUS FINANCIAL CORP	syn-20200721.htm


				Exhibit 99.2

INCOME STATEMENT DATA
(Unaudited)

(Dollars in thousands, except per share data)							Second Quarter

	2020			2019			'20 vs '19
									% Change

Interest income	$	935,466		$	1,020,970		(8.4)	%
Interest expense	185,640			226,532			(18.1)

Net interest income	749,826			794,438			(5.6)
Provision for credit losses	300,573			35,688			742.2

Net interest income after provision for credit losses	449,253			758,750			(40.8)

Non-interest revenue:
Service charges on deposit accounts	36,255			42,853			(15.4)
Fiduciary and asset management fees	30,124			28,057			7.4
Card fees	20,136			22,037			(8.6)
Brokerage revenue	22,383			19,431			15.2
Mortgage banking income	35,757			12,962			175.9
Capital markets income	17,294			14,161			22.1
Income from bank-owned life insurance	13,794			10,466			31.8
Investment securities gains/(losses), net	78,144			(1,771)			nm
Gain on sale and fair value increase, net, of private equity investments	4,452			2,313			nm
Other non-interest revenue	19,002			18,676			1.7

Total non-interest revenue	277,341			169,185			63.9

Non-interest expense:
Salaries and other personnel expense	309,274			282,436			9.5
Net occupancy, equipment, and software expense	83,921			78,245			7.3
Third-party processing and other services	42,846			36,875			16.2
Professional fees	25,980			15,660			65.9
FDIC insurance and other regulatory fees	12,129			14,629			(17.1)
Amortization of intangibles	5,280			5,802			(9.0)
Merger-related expense	—			57,140			nm
Earnout liability adjustments	4,908			—			nm
Loss on early extinguishment of debt, net	1,904			—			nm
Restructuring charges	6,042			37			nm
Other operating expenses	68,137			65,713			3.7

Total non-interest expense	560,421			556,537			0.7

Income before income taxes	166,173			371,398			(55.3)
Income tax expense	34,461			95,028			(63.7)

Net income	131,712			276,370			(52.3)

Less: Preferred stock dividends	16,581			6,300			163.2

Net income available to common shareholders	$	115,131		$	270,070		(57.4)	%

Net income per common share, basic	$	0.78		$	1.70		(53.9)	%

Net income per common share, diluted	0.78			1.68			(53.7)

Cash dividends declared per common share	0.66			0.60			10.0

Return on average assets *	0.52		%	1.21		%	(69)	bps
Return on average common equity *	5.15			12.46			(731)

Weighted average common shares outstanding, basic	147,300			159,148			(7.4)	%
Weighted average common shares outstanding, diluted	148,067			160,908			(8.0)

nm - not meaningful
bps - basis points
* - ratios are annualized


Synovus

	INCOME STATEMENT DATA
	(Unaudited)

	(Dollars in thousands, except per share data)	2020					2019				Second Quarter

		Second Quarter			First Quarter	Fourth Quarter	Third Quarter	Second Quarter	'20 vs '19
												% Change

	Interest income	$	451,569		483,897	506,253	523,415	516,131	(12.5)	%
	Interest expense	75,003			110,637	106,985	121,318	118,869	(36.9)

	Net interest income	376,566			373,260	399,268	402,097	397,262	(5.2)
	Provision for credit losses	141,851			158,722	24,470	27,562	12,119	nm

	Net interest income after provision for credit losses	234,715			214,538	374,798	374,535	385,143	(39.1)

	Non-interest revenue:
	Service charges on deposit accounts	15,567			20,689	22,385	22,952	21,994	(29.2)
	Fiduciary and asset management fees	14,950			15,174	15,645	14,686	14,478	3.3
	Card fees	9,186			10,950	11,325	12,297	11,161	(17.7)
	Brokerage revenue	9,984			12,398	11,106	11,071	10,052	(0.7)
	Mortgage banking income	23,530			12,227	9,287	10,351	7,907	197.6
	Capital markets income	6,050			11,243	8,972	7,396	8,916	(32.1)
	Income from bank-owned life insurance	7,756			6,038	5,620	5,139	5,176	49.8
	Investment securities gains/(losses), net	69,409			8,734	(2,157)	(3,731)	(1,845)	nm
	Gain on sale and fair value increase/(decrease) of private equity investments	8,707			(4,255)	8,100	1,194	1,455	nm
	Other non-interest revenue	8,345			10,659	7,672	7,405	10,513	(20.6)

	Total non-interest revenue	173,484			103,857	97,955	88,760	89,807	93.2

	Non-interest expense:
	Salaries and other personnel expense	159,597			149,678	145,084	142,516	143,009	11.6
	Net occupancy, equipment, and software expense	41,727			42,194	42,644	41,017	39,851	4.7
	Third-party processing and other services	21,366			21,480	20,293	18,528	19,118	11.8
	Professional fees	15,305			10,675	9,921	9,719	9,312	64.4
	FDIC insurance and other regulatory fees	6,851			5,278	9,825	7,242	7,867	(12.9)
	Amortization of intangibles	2,640			2,640	2,901	2,901	2,410	9.5
	Merger-related expense	—			—	(913)	353	7,401	nm
	Earnout liability adjustments	4,908			—	—	10,457	—	nm
	Loss on early extinguishment of debt, net	—			1,904	—	4,592	—	nm
	Valuation adjustment to Visa derivative	—			—	1,111	2,500	—	nm
	Restructuring charges	2,822			3,220	1,259	(66)	18	nm
	Other operating expenses	28,925			39,210	33,996	36,551	35,140	(17.7)

	Total non-interest expense	284,141			276,279	266,121	276,310	264,126	7.6

	Income before income taxes	124,058			42,116	206,632	186,985	210,824	(41.2)
	Income tax expense	30,866			3,595	54,948	51,259	54,640	(43.5)

	Net income	93,192			38,521	151,684	135,726	156,184	(40.3)

	Less: Preferred stock dividends	8,291			8,291	8,291	8,291	3,150	163.2

	Net income available to common shareholders	$	84,901		30,230	143,393	127,435	153,034	(44.5)	%

	Net income per common share, basic	$	0.58		0.21	0.98	0.84	0.97	(40.7)	%

	Net income per common share, diluted	0.57			0.20	0.97	0.83	0.96	(40.3)

	Cash dividends declared per common share	0.33			0.33	0.30	0.30	0.30	10.0

	Return on average assets *	0.71		%	0.32	1.27	1.14	1.34	(63)	bps
	Return on average common equity *	7.48			2.75	13.08	11.36	13.90	(642)

	Weighted average common shares outstanding, basic	147,288			147,311	146,948	152,238	157,389	(6.4)	%
	Weighted average common shares outstanding, diluted	147,733			148,401	148,529	154,043	159,077	(7.1)

	nm - not meaningful
	bps - basis points
	* - ratios are annualized


Synovus


	BALANCE SHEET DATA	June 30, 2020		December 31, 2019		June 30, 2019

	(Unaudited)

	(In thousands, except share data)

	ASSETS
	Cash and due from banks	$	572,169	$	535,846	$	549,616
	Interest-bearing funds with Federal Reserve Bank	860,289		553,390		531,488
	Interest earning deposits with banks	20,719		20,635		20,271
	Federal funds sold and securities purchased under resale agreements	118,048		77,047		49,946
	Cash and cash equivalents	1,571,225		1,186,918		1,151,321

	Investment securities available for sale, at fair value	7,197,493		6,778,670		7,007,012
	Loans held for sale ($266,306, $115,173, $81,855 measured at fair value, respectively)	900,936		115,173		86,716

	Loans, net of deferred fees and costs	39,914,297		37,162,450		36,138,561
	Allowance for loan losses	(588,648)		(281,402)		(257,376)
	Loans, net	39,325,649		36,881,048		35,881,185

	Cash surrender value of bank-owned life insurance	1,038,049		775,665		766,287
	Premises and equipment, net	481,716		493,940		490,644
	Goodwill	497,267		497,267		492,390
	Other intangible assets, net	50,392		55,671		61,473
	Receivable on unsettled securities sales	1,289,116		—		—
	Other assets	1,770,146		1,418,930		1,381,175
	Total assets	$	54,121,989	$	48,203,282	$	47,318,203

	LIABILITIES AND SHAREHOLDERS' EQUITY
	Liabilities:
	Deposits:
	Non-interest-bearing deposits	$	12,555,714	$	9,439,485	$	9,205,066
	Interest-bearing deposits	31,638,866		28,966,019		28,761,656

	Total deposits	44,194,580		38,405,504		37,966,722

	Federal funds purchased and securities sold under repurchase agreements	225,576		165,690		273,481
	Other short-term borrowings	300,000		1,753,560		1,330,000
	Long-term debt	2,327,921		2,153,897		2,306,072
	Due on unsettled securities purchases	922,952		—		—
	Other liabilities	1,097,992		782,941		688,112
	Total liabilities	49,069,021		43,261,592		42,564,387

	Shareholders' equity:
	Preferred stock - no par value. Authorized 100,000,000 shares; issued 22,000,000, 22,000,000, and 8,000,000	537,145		537,145		195,140
	Common stock - $1.00 par value. Authorized 342,857,143 shares; issued 167,405,730, 166,800,623, and 166,079,543; outstanding 147,312,703, 147,157,596, and 156,872,026	167,406		166,801		166,080
	Additional paid-in capital	3,826,726		3,819,336		3,801,748
	Treasury stock, at cost – 20,093,027, 19,643,027, and 9,207,517 shares	(731,806)		(715,560)		(344,901)
	Accumulated other comprehensive income, net	202,970		65,641		49,289
	Retained earnings	1,050,527		1,068,327		886,460
	Total shareholders’ equity	5,052,968		4,941,690		4,753,816
	Total liabilities and shareholders' equity	$	54,121,989	$	48,203,282	$	47,318,203


Synovus
	AVERAGE BALANCES AND YIELDS/RATES⁽¹⁾
	(Unaudited)	2020					2019
	(Dollars in thousands)

		Second			First	Fourth	Third	Second
		Quarter			Quarter	Quarter	Quarter	Quarter
	Interest Earning Assets
	Investment securities^{(2) (4)}	$	6,618,533		6,680,047	6,696,768	6,831,036	6,955,386
	Yield	2.72		%	3.09	3.12	3.14	3.03
	Trading account assets ⁽⁵⁾	$	6,173		6,306	7,986	5,519	4,853
	Yield	2.19		%	2.70	2.69	4.01	1.83
	Commercial loans ^{(3) (4)}	$	30,236,919		27,607,343	26,698,202	26,567,719	26,353,701
	Yield	3.95		%	4.57	4.82	5.09	5.13
	Consumer loans ⁽³⁾	$	9,899,172		9,985,702	9,809,832	9,633,603	9,423,427
	Yield	4.34		%	4.60	5.07	5.08	5.17
	Allowance for loan losses	$	(498,545)		(368,033)	(269,052)	(258,024)	(259,284)
	Loans, net ⁽³⁾	$	39,637,546		37,225,012	36,238,982	35,943,298	35,517,844
	Yield	4.08		%	4.62	4.93	5.13	5.17
	Mortgage loans held for sale	$	221,157		86,415	117,909	99,556	70,497
	Yield	3.09		%	3.67	3.77	3.93	4.27
	Other loans held for sale	$	19,246		—	—	475	272
	Yield	4.19		%	—	—	—	—
	Federal funds sold, due from Federal Reserve Bank, and other short-term investments	$	1,709,086		652,130	514,635	513,160	511,488
	Yield	0.11		%	1.02	1.71	2.08	2.37
	Federal Home Loan Bank and Federal Reserve Bank Stock ⁽⁵⁾	$	247,801		284,082	278,586	254,994	234,949
	Yield	3.60		%	3.38	2.85	3.85	3.29
	Total interest earning assets	$	48,459,542		44,933,992	43,854,866	43,648,038	43,295,289
	Yield	3.75		%	4.33	4.60	4.78	4.79
	Interest-Bearing Liabilities
	Interest-bearing demand deposits	$	7,260,940		6,445,986	6,381,282	6,138,810	6,335,953
	Rate	0.21		%	0.51	0.60	0.69	0.71
	Money Market accounts	$	12,238,479		11,548,014	10,526,296	10,138,783	10,024,836
	Rate	0.46		%	1.00	1.13	1.26	1.23
	Savings deposits	$	1,036,024		926,822	915,640	900,366	904,183
	Rate	0.02		%	0.05	0.05	0.05	0.05
	Time deposits under $100,000	$	1,621,943		1,761,741	1,873,350	2,100,492	2,245,878
	Rate	1.43		%	1.64	1.27	1.39	1.39
	Time deposits over $100,000	$	4,772,555		5,051,705	5,198,266	5,957,691	6,331,665
	Rate	1.80		%	2.04	1.51	1.69	1.70
	Other brokered deposits	$	1,998,571		1,376,669	1,156,131	993,078	766,718
	Rate	0.25		%	1.42	1.84	2.47	2.46
	Brokered time deposits	$	2,244,429		2,166,496	2,121,069	2,119,149	1,985,589
	Rate	1.86		%	2.11	2.16	2.27	2.28
	Total interest-bearing deposits	$	31,172,941		29,277,433	28,172,034	28,348,369	28,594,822
	Rate	0.73		%	1.18	1.16	1.32	1.30
	Federal funds purchased and securities sold under repurchase agreements	$	250,232		167,324	192,731	221,045	300,168
	Rate	0.12		%	0.30	0.24	0.22	0.20
	Other short-term borrowings	$	550,000		1,384,362	1,565,507	1,307,370	1,090,581
	Rate	1.23		%	1.66	1.87	2.31	2.59
	Long-term debt	$	2,834,188		2,678,651	2,153,983	2,286,221	2,114,819
	Rate	2.36		%	2.78	3.07	3.32	3.53
	Total interest-bearing liabilities	$	34,807,361		33,507,770	32,084,255	32,163,005	32,100,390
	Rate	0.86		%	1.30	1.30	1.47	1.48
	Non-interest-bearing demand deposits	$	11,923,534		9,409,774	9,706,784	9,365,776	9,304,839
	Cost of funds	0.65		%	1.04	1.02	1.16	1.15
	Net interest margin	3.13		%	3.37	3.65	3.69	3.69
	Taxable equivalent adjustment⁽⁴⁾	$	861		786	769	819	811
	⁽¹⁾Yields and rates are annualized.
	⁽²⁾Excludes net unrealized gains and losses.
	⁽³⁾Average loans are shown net of unearned income. Non-performing loans are included.
	⁽⁴⁾Reflects taxable-equivalent adjustments, using the statutory federal income tax rate of 21%, in adjusting interest on tax-exempt loans and investment securities to a taxable-equivalent basis.
	⁽⁵⁾ Included as a component of other assets on the consolidated balance sheet.


Synovus
LOANS OUTSTANDING BY TYPE
(Unaudited)	Total Loans		Total Loans		Linked Quarter		Total Loans		Year/Year
(Dollars in thousands)

Loan Type	June 30, 2020		March 31, 2020		% Change		June 30, 2019		% Change
Commercial, Financial, and Agricultural	$	13,136,696	$	11,018,155	19.2	%	$	9,716,939	35.2	%
Owner-Occupied	6,801,580		6,643,287		2.4		6,511,805		4.4
Total Commercial & Industrial	19,938,276		17,661,442		12.9		16,228,744		22.9
Multi-Family	2,252,820		2,108,360		6.9		2,023,061		11.4
Hotels	1,364,511		1,314,053		3.8		1,244,519		9.6
Office Buildings	2,297,721		2,264,844		1.5		2,297,515		—
Shopping Centers	1,738,504		1,741,557		(0.2)		1,682,283		3.3
Warehouses	781,252		761,863		2.5		686,827		13.7
Other Investment Property	1,012,392		1,027,757		(1.5)		980,787		3.2
Total Investment Properties	9,447,200		9,218,434		2.5		8,914,992		6.0
1-4 Family Construction	229,999		255,005		(9.8)		276,068		(16.7)
1-4 Family Investment Mortgage	466,809		482,773		(3.3)		528,358		(11.6)
Total 1-4 Family Properties	696,808		737,778		(5.6)		804,426		(13.4)
Commercial Development	112,539		107,351		4.8		138,840		(18.9)
Residential Development	270,952		303,459		(10.7)		213,823		26.7
Land Acquisition	300,036		304,179		(1.4)		295,165		1.7
Land and Development	683,527		714,989		(4.4)		647,828		5.5
Total Commercial Real Estate	10,827,535		10,671,201		1.5		10,367,246		4.4
Consumer Mortgages	5,811,376		5,608,121		3.6		5,407,762		7.5
Home Equity Lines	1,710,264		1,778,862		(3.9)		1,650,745		3.6
Credit Cards	250,448		261,581		(4.3)		258,283		(3.0)
Other Consumer Loans	1,474,583		2,302,349		(36.0)		2,249,337		(34.4)
Total Consumer	9,246,671		9,950,913		(7.1)		9,566,127		(3.3)
Unearned Income	(98,185)		(25,532)		284.6		(23,556)		316.8
Total	$	39,914,297	$	38,258,024	4.3	%	$	36,138,561	10.4	%

NON-PERFORMING LOANS COMPOSITION
(Unaudited)	Total Non-performing Loans		Total Non-performing Loans		Linked Quarter		Total Non-performing Loans		Year/Year
(Dollars in thousands)

Loan Type	June 30, 2020		March 31, 2020		% Change		June 30, 2019		% Change
Commercial, Financial, and Agricultural	$	83,000	$	99,287	(16.4)	%	$	72,934	13.8	%
Owner-Occupied	19,605		17,357		13.0		13,465		45.6
Total Commercial & Industrial	102,605		116,644		(12.0)		86,399		18.8
Multi-Family	—		356		(100.0)		—		nm
Hotels	—		—		nm		—		nm
Office Buildings	836		836		—		300		178.7
Shopping Centers	409		712		(42.6)		671		(39.0)
Other Investment Property	393		308		27.6		7		nm
Total Investment Properties	1,638		2,212		(25.9)		978		67.5
1-4 Family Construction	2,593		278		832.7		208		nm
1-4 Family Investment Mortgage	1,844		2,047		(9.9)		1,637		12.6
Total 1-4 Family Properties	4,437		2,325		90.8		1,845		140.5
Commercial Development	840		596		40.9		—		nm
Residential Development	685		561		22.1		1,253		(45.3)
Land Acquisition	1,042		1,043		(0.1)		1,482		(29.7)
Land and Development	2,567		2,200		16.7		2,735		(6.1)
Total Commercial Real Estate	8,642		6,737		28.3		5,558		55.5
Consumer Mortgages	17,438		13,571		28.5		13,628		28.0
Home Equity Lines	14,200		12,475		13.8		13,830		2.7
Other Consumer Loans	4,552		6,860		(33.6)		4,667		(2.5)
Total Consumer	36,190		32,906		10.0		32,125		12.7
Total	$	147,437	$	156,287	(5.7)	%	$	124,082	18.8	%


Synovus

	CREDIT QUALITY DATA
	(Unaudited)
	(Dollars in thousands)				2020				2019				Second Quarter

		Second				First	Fourth	Third		Second	'20 vs '19
		Quarter				Quarter	Quarter	Quarter		Quarter	% Change

	Non-performing Loans (NPLs)	$	147,437			156,287	101,636	115,915		124,083	18.8	%
	Other Real Estate and Other Assets	30,242				33,679	35,810	35,400		15,479	95.4

	Non-performing Assets (NPAs)	177,679				189,966	137,446	151,315		139,562	27.3

	Allowance for Loan Losses (ALL)	588,648				493,452	281,402	265,013		257,376	128.7
	Reserve for Unfunded Commitments	61,029				38,420	1,375	1,496		995	nm

	Allowance for Credit Losses (ACL)	649,677				531,872	282,777	266,509		258,371	151.5

	Net Charge-Offs - Quarter	24,045				20,061	8,821	19,925		11,779
	Net Charge-Offs - YTD	44,106				20,061	57,612	48,791		28,867
	Net Charge-Offs / Average Loans - Quarter ⁽¹⁾	0.24		%		0.21	0.10	0.22		0.13
	Net Charge-Offs / Average Loans - YTD ⁽¹⁾	0.23				0.21	0.16	0.18		0.16
	NPLs / Loans	0.37				0.41	0.27	0.32		0.34
	NPAs / Loans, ORE and specific other assets	0.44				0.50	0.37	0.42		0.39
	ACL/Loans	1.63				1.39	0.76	0.73		0.71
	ALL/Loans	1.47				1.29	0.76	0.73		0.71

	ACL/NPLs	440.65				340.32	278.23	229.92		208.22
	ALL/NPLs	399.25				315.74	276.87	228.63		207.42

	Past Due Loans over 90 days and Still Accruing	$	8,391			6,398	15,943	15,660		5,851	43.4
	As a Percentage of Loans Outstanding	0.02		%		0.02	0.04	0.04		0.02

	Total Past Due Loans and Still Accruing	$	46,390			83,235	123,793	88,219		80,792	(42.6)
	As a Percentage of Loans Outstanding	0.12		%		0.22	0.33	0.24		0.22

	Accruing Troubled Debt Restructurings (TDRs)	$	166,461			160,128	133,145	130,019		126,369	31.7

	⁽¹⁾ Ratio is annualized.




	SELECTED CAPITAL INFORMATION ⁽¹⁾
	(Unaudited)
	(Dollars in thousands)
		June 30, 2020				December 31, 2019	June 30, 2019


	Tier 1 Capital	$	4,364,077			4,280,604	4,094,672
	Total Risk-Based Capital	5,459,271				5,123,381	4,913,043
	Common Equity Tier 1 Capital Ratio	8.90		%		8.95	9.61
	Tier 1 Capital Ratio	10.15				10.23	10.09
	Total Risk-Based Capital Ratio	12.70				12.25	12.11
	Tier 1 Leverage Ratio	8.38				9.16	8.89
	Common Equity as a Percentage of Total Assets ⁽²⁾	8.34				9.14	9.63
	Tangible Common Equity Ratio ^{(3) (5)}	7.41				8.08	8.56
	Book Value Per Common Share⁽⁴⁾	$	30.65			29.93	29.06
	Tangible Book Value Per Common Share ⁽³⁾	26.94				26.17	25.53

	⁽¹⁾ Current quarter regulatory capital information is preliminary.
	⁽²⁾ Common equity consists of Total Shareholders' Equity less Preferred Stock.
	⁽³⁾ Excludes the carrying value of goodwill and other intangible assets from common equity and total assets.
	⁽⁴⁾ Book Value Per Common Share consists of Total Shareholders' Equity less Preferred Stock divided by total common shares outstanding.
	⁽⁵⁾ See "Non-GAAP Financial Measures" of this report for applicable reconciliation.

SYNOVUS FINANCIAL CORP - FORM 8-K - EX-99.2 - July 21, 2020

Attached files

SYNOVUS FINANCIAL CORP Reports