LITITZ, Pa.--(BUSINESS WIRE)--Susquehanna Bancshares, Inc. (Susquehanna) (NASDAQ: SUSQ) today announced that it earned net income for the second quarter ended June 30, 2014 of $43.5 million, or $0.23 per diluted share, compared to $37.2 million, or $0.20 per diluted share, for the first quarter of 2014 and $45.6 million, or $0.24 per diluted share, for the second quarter of 2013.
In addition, Susquehanna announced that its Board of Directors has authorized the repurchase of up to 3.5% of total outstanding common shares through December 31, 2014. As of June 30, 2014, Susquehanna had approximately 187.7 million shares of common stock outstanding. As permitted by securities laws and subject to market conditions and other factors, purchases may be made from time to time in the open market or through negotiated transactions. The repurchase program may be discontinued at any time.
“We continued to execute on our strategic plan by growing deposits, commercial loans and branch-based HELOCs while deemphasizing other loan categories, such as residential loans we portfolio,” said William J. Reuter, Susquehanna’s Chairman and Chief Executive Officer. “Also, during the last few years we have been accumulating capital. After careful consideration, we have concluded that our capital position is in excess of our need, and therefore, determined that we should begin returning this excess capital to our shareholders.”
Linked Quarter Results (Second Quarter 2014 vs. First Quarter 2014)
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Loans and leases increased $91.9 million or 0.7% from March 31, 2014
to $13.7 billion at June 30, 2014. Changes for the quarter in each
major loan category were as follows:
- Commercial loans increased 0.5%.
- Real estate – construction loans increased 4.7%.
- Real estate secured – residential loans were essentially flat.
- Real estate secured – commercial loans increased 0.3%.
- Consumer loans increased 0.7%.
- Leases increased 2.2%.
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Total deposits increased $235.5 million or 1.8% from March 31, 2014 to
$13.3 billion at June 30, 2014. Changes for the quarter in each major
deposit category were as follows:
- Non-interest bearing checking increased 2.9%.
- Interest-bearing checking decreased 0.9%.
- Money market deposits decreased 5.0%.
- Savings deposits increased 0.3%.
- Time deposits increased 9.1%.
- As a result of growth in the deposit portfolio, the loan to deposit ratio decreased to 102.6% for the second quarter of 2014 compared to 103.8% for the first quarter of 2014.
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Net interest margin increased 2 basis points to 3.63% for the second
quarter of 2014 compared to 3.61% for the first quarter of 2014. The
second quarter of 2014 included a 9 basis point gain from the
redemption of a trust preferred security. Net interest margin
(excluding purchase accounting) (1) declined 2 basis points
to 3.38% for the second quarter of 2014 compared to 3.40% for the
first quarter of 2014.
In the third quarter of 2014, management expects the net interest margin (excluding purchase accounting) (1) to decline slightly, within a range of 3.32% to 3.36%.
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Non-interest income increased to $45.3 million for the second quarter
of 2014 compared to $42.1 million for the first quarter of 2014. The
second quarter of 2014 included a net realized gain on sale of
securities of $3.3 million.
Excluding the net realized gain on sale of securities in the second quarter of 2014, management expects noninterest income to increase in the third quarter of 2014 due to an anticipated increase in mortgage banking activity and SBA loan sales.
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Non-interest expense increased to $125.2 million for the second
quarter of 2014 compared to $123.0 million in the first quarter of
2014.
Management expects non-interest expenses to increase slightly in the third quarter of 2014. - The efficiency ratio (1) decreased to 65.63% for the second quarter of 2014 compared to 66.18% in the first quarter of 2014.
- Non-performing assets as a percentage of loans, leases and foreclosed real estate owned decreased to 0.85% at June 30, 2014 compared to 0.89% at March 31, 2014.
- The provision for loan and lease losses in the second quarter decreased to $3.0 million compared to $6.0 million in the first quarter of 2014. Net charge-offs for the second quarter increased to $11.4 million, or 0.34% of average loans and leases, compared to $9.5 million, or 0.28% of average loans and leases, for the first quarter of 2014. As a result, the allowance for loan and lease losses was $144.5 million at June 30, 2014, representing 1.06% of total loans and leases and 137% of nonaccrual loans and leases compared to $154.2 million at March 31, 2014, representing 1.14% of total loans and leases and 142% of nonaccrual loans and leases.
Second Quarter Results (Second Quarter 2014 vs. Second Quarter 2013)
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Loans and leases increased $509.4 million or 3.9% from June 30, 2013
to $13.7 billion at June 30, 2014. Changes for the twelve month period
in each major loan category were as follows:
- Commercial loans increased 5.8%.
- Real estate - construction loans decreased 2.8%.
- Real estate secured - residential loans increased 1.9%.
- Real estate secured - commercial loans increased 0.6%.
- Consumer loans increased 6.0%.
- Leases increased 22.4%.
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Total deposits increased $550.8 million or 4.3% from June 30, 2013 to
$13.3 billion as of June 30, 2014. Changes for the twelve month period
in each major deposit category were as follows:
- Non-interest-bearing checking increased 0.2%.
- Interest-bearing checking increased 4.2%.
- Money market deposits decreased 2.5%.
- Savings deposits increased 4.6%.
- Time deposits increased 11.8%.
- Loan to deposit ratio decreased to 102.6% for the second quarter of 2014 compared to 103.1% for the second quarter of 2013.
- Net interest margin decreased 25 basis points to 3.63% compared to 3.88% for the second quarter of 2013. Net interest margin (excluding purchase accounting) (1) declined 16 basis points to 3.38% compared to 3.54% for the second quarter of 2013.
- Non-interest income decreased to $45.3 million compared to $49.1 million in the second quarter of 2013.
- Non-interest expense increased to $125.2 million compared to $119.7 million in the second quarter of 2013.
- The efficiency ratio (1) increased to 65.63% compared to 59.57% in the second quarter of 2013.
- Non-performing assets as a percentage of loans, leases and foreclosed real estate decreased to 0.85% compared to 0.94% at June 30, 2013.
- The provision for loan and lease losses decreased to $3.0 million compared to $12.0 million for the second quarter of 2013. Net charge-offs as a percentage of average loans and leases increased to 0.34% compared to 0.30% for the second quarter of 2013. The allowance for loan and lease losses was $144.5 million, representing 1.06% of total loans and leases and 137% of nonaccrual loans and leases, compared to $178.6 million at June 30, 2013, representing 1.36% of total loans and leases and 170% of nonaccrual loans and leases.
- Return on average assets and average tangible equity (1) decreased to 0.95% and 12.34%, respectively compared to 1.01% and 14.30%, respectively for the second quarter of 2013.
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Susquehanna’s capital ratios continue to exceed internal capital
targets and those required to be considered “well-capitalized” under
the current regulatory requirements, with a Tier 1 common ratio of
10.99%, Tier 1 capital ratio of 12.02%, Total risk-based capital ratio
of 13.22% and a Leverage ratio of 9.90%, each as of June 30, 2014.
Based on a preliminary analysis of the new capital rules approved in
July 2013, management believes that Susquehanna would be fully
compliant with the revised capital ratio standards as of June 30, 2014
if they had been effective on that date.
(1) Non-GAAP based financial measure. Please refer to the calculations and management’s reasons for using this measure in the accompanying financial schedules
Additional Events
- At June 30, 2014, Susquehanna reclassified approximately $265 million of indirect auto loans from held for investment to held for sale. The loans were transferred to held for sale at their amortized cost basis on the date of transfer and will be measured at the lower of their amortized cost or fair value until the loans are sold or securitized. Amortized cost was lower than fair value as of June 30, 2014. Susquehanna expects to complete a securitization or other off balance sheet transaction involving substantially all of these loans during 2014.
- On July 7, 2014, Standard & Poor’s Ratings Services raised its ratings on Susquehanna, including its long-term issuer credit rating to ‘BBB’ from ‘BBB-’.
- On July 16, 2014, Susquehanna’s Board of Directors declared a second quarter dividend of $0.09 per common share, payable on August 20, 2014 to shareholders of record on August 1, 2014.
Susquehanna will broadcast its second quarter 2014 conference call over the Internet on July 24, 2014, at 11:00 a.m. Eastern time. The conference call will include management’s discussion of second quarter 2014 financial results and may also include forward-looking information and financial goals. Investors will have the opportunity to listen to the conference call through a live broadcast on Susquehanna’s website. The event may be accessed by selecting "Investor Relations" near the bottom of the home page and clicking on the second quarter webcast link. To listen to the live call, please go to the website at least 15 minutes prior to the scheduled start time to download and install any necessary audio software. For those who are unable to listen to the live broadcast, an archived replay and podcast will be available on the website shortly after the call concludes.
Susquehanna is a financial services holding company with assets of approximately $18.5 billion. Headquartered in Lititz, Pa., Susquehanna provides banking and financial services at 245 branch locations in the mid-Atlantic region. Through Susquehanna Wealth Management, the company offers investment, fiduciary, brokerage, insurance, retirement planning, and private banking services, with approximately $8.0 billion in assets under management and administration. Susquehanna also operates an insurance brokerage and employee benefits company, a commercial finance company and a vehicle leasing company. Investor information may be requested through Susquehanna’s Website at www.susquehanna.net.
This press release contains certain financial information determined by methods other than in accordance with GAAP. Susquehanna’s management uses these non-GAAP measures in its analysis of the company’s performance. These non-GAAP financial measures require management to make judgments about the exclusion of certain items, and if different judgments were made, the amounts reported would be different. These measures typically exclude the effects of intangibles and related amortization and include the tax benefit associated with revenue items that are tax-exempt. Disclosures regarding these non-GAAP financial measures are included in the accompanying financial information.
The presentation of these non-GAAP financial measures is intended to supplement investors’ understanding of Susquehanna’s core business activities. These non-GAAP disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures which may be presented by other companies.
This release includes forward-looking statements as that term is defined in the U.S. Private Securities Litigation Reform Act of 1995. Actual results and trends could differ materially from those set forth in such statements due to various risks, uncertainties and other factors. Forward-looking statements can be identified by words such as “believes,” “anticipates,” “expects,” “intends,” “targeted,” “continue,” “remain,” “will,” “should,” “may,” “plans,” “estimates,” and similar words or expressions. The risks, uncertainties and other factors that could cause actual results and experience to differ from those projected include, but are not limited to, the following: ineffectiveness of Susquehanna’s business strategy due to changes in current or future market conditions; the effects of competition, including industry consolidation and development of competing financial products and services; the costs and effects of legal and regulatory developments including the resolution of legal proceedings or regulatory or other governmental inquiries and the results of regulatory examinations or reviews; interest rate movements; changes in credit quality; deteriorating economic conditions; market or other events adversely affecting our ability to conduct off-balance transactions; other risks and uncertainties; our success at managing the risks involved in the foregoing items; and the other factors detailed in Susquehanna’s filings with the Securities and Exchange Commission. Susquehanna encourages readers of this release to understand forward-looking statements to be strategic objectives rather than absolute targets of future performance. Forward-looking statements speak only as of the date they are made. Susquehanna does not intend to update publicly any forward-looking statements to reflect circumstances or events that occur after the date the forward-looking statements are made or to reflect the occurrence of unanticipated events except as required by law.
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Susquehanna Bancshares, Inc. |
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26 North Cedar Street |
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Lititz, PA 17543 |
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| SUMMARY CONSOLIDATED FINANCIAL INFORMATION | ||||||||||||||||||||||||||||
| (in thousands, except per share data) | ||||||||||||||||||||||||||||
| Six Months YTD | ||||||||||||||||||||||||||||
| 2Q14 | 1Q14 | 4Q13 | 3Q13 | 2Q13 | 2014 | 2013 | ||||||||||||||||||||||
| Balance Sheet (EOP) | ||||||||||||||||||||||||||||
| Investments | $ | 2,324,782 | $ | 2,445,322 | $ | 2,533,456 | $ | 2,644,162 | $ | 2,494,178 | $ | 2,324,782 | $ | 2,494,178 | ||||||||||||||
| Loans and leases | 13,667,153 | 13,575,295 | 13,576,086 | 13,376,454 | 13,157,762 | 13,667,153 | 13,157,762 | |||||||||||||||||||||
| Allowance for loan and lease losses | 144,483 | 154,150 | 157,608 | 166,740 | 178,594 | 144,483 | 178,594 | |||||||||||||||||||||
| Total assets | 18,506,626 | 18,439,682 | 18,473,489 | 18,481,150 | 18,083,039 | 18,506,626 | 18,083,039 | |||||||||||||||||||||
| Deposits | 13,314,994 | 13,079,523 | 12,869,372 | 12,721,685 | 12,764,232 | 13,314,994 | 12,764,232 | |||||||||||||||||||||
| Other short-term borrowings | 527,079 | 584,664 | 555,740 | 688,456 | 706,065 | 527,079 | 706,065 | |||||||||||||||||||||
| Federal Home Loan Bank borrowings | 1,127,302 | 1,229,296 | 1,531,282 | 1,593,272 | 1,161,995 | 1,127,302 | 1,161,995 | |||||||||||||||||||||
| Other long-term debt | 360,033 | 448,521 | 453,260 | 457,804 | 489,002 | 360,033 | 489,002 | |||||||||||||||||||||
| Shareholders' equity | 2,796,392 | 2,755,199 | 2,717,587 | 2,679,348 | 2,644,940 | 2,796,392 | 2,644,940 | |||||||||||||||||||||
| Average Balance Sheet | ||||||||||||||||||||||||||||
| Investments | $ | 2,395,690 | $ | 2,505,937 | $ | 2,616,807 | $ | 2,584,212 | $ | 2,503,991 | $ | 2,450,509 | $ | 2,553,518 | ||||||||||||||
| Loans and leases | 13,589,533 | 13,574,526 | 13,421,474 | 13,290,513 | 13,110,128 | 13,582,071 | 13,020,246 | |||||||||||||||||||||
| Total earning assets | 16,066,177 | 16,162,210 | 16,124,369 | 15,960,228 | 15,720,859 | 16,114,489 | 15,681,801 | |||||||||||||||||||||
| Total assets | 18,378,127 | 18,411,873 | 18,437,954 | 18,258,982 | 18,071,466 | 18,419,028 | 18,051,408 | |||||||||||||||||||||
| Deposits | 13,131,617 | 12,874,040 | 12,806,503 | 12,794,022 | 12,867,874 | 13,003,540 | 12,754,840 | |||||||||||||||||||||
| Other short-term borrowings | 552,367 | 671,653 | 671,923 | 758,079 | 728,497 | 611,681 | 772,910 | |||||||||||||||||||||
| Federal Home Loan Bank borrowings | 1,174,611 | 1,387,124 | 1,502,120 | 1,285,276 | 1,041,577 | 1,280,280 | 1,098,292 | |||||||||||||||||||||
| Other long-term debt | 396,367 | 451,267 | 455,787 | 475,655 | 496,240 | 423,666 | 502,356 | |||||||||||||||||||||
| Shareholders' equity | 2,768,665 | 2,726,465 | 2,679,242 | 2,642,806 | 2,648,314 | 2,753,315 | 2,631,411 | |||||||||||||||||||||
| Income Statement | ||||||||||||||||||||||||||||
| Net interest income | $ | 141,694 | $ | 140,064 | $ | 142,688 | $ | 145,949 | $ | 148,097 | $ | 281,758 | $ | 297,303 | ||||||||||||||
| Provision for loan and lease losses | 3,000 | 6,000 | 2,000 | 5,000 | 12,000 | 9,000 | 24,000 | |||||||||||||||||||||
| Noninterest income | 45,349 | 42,089 | 50,666 | 41,343 | 49,076 | 87,438 | 91,720 | |||||||||||||||||||||
| Noninterest expense | 125,225 | 123,032 | 135,672 | 117,701 | 119,738 | 248,257 | 237,467 | |||||||||||||||||||||
| Income before taxes | 58,818 | 53,121 | 55,682 | 64,591 | 65,435 | 111,939 | 127,556 | |||||||||||||||||||||
| Provision for income taxes | 15,324 | 15,959 | 14,341 | 20,300 | 19,787 | 31,283 | 39,509 | |||||||||||||||||||||
| Net income | 43,494 | 37,162 | 41,341 | 44,291 | 45,648 | 80,656 | 88,047 | |||||||||||||||||||||
| Basic earnings per common share | 0.23 | 0.20 | 0.22 | 0.24 | 0.24 | 0.43 | 0.47 | |||||||||||||||||||||
| Diluted earnings per common share | 0.23 | 0.20 | 0.22 | 0.24 | 0.24 | 0.43 | 0.47 | |||||||||||||||||||||
| Cash dividends paid per common share | 0.08 | 0.08 | 0.08 | 0.08 | 0.08 | 0.16 | 0.08 | |||||||||||||||||||||
| Asset Quality | ||||||||||||||||||||||||||||
| Net charge-offs (NCOs) | $ | 11,431 | $ | 9,458 | $ | 11,132 | $ | 16,854 | $ | 9,784 | $ | 20,889 | $ | 29,427 | ||||||||||||||
| Nonaccrual loans and leases | $ | 105,609 | $ | 108,408 | $ | 100,815 | $ | 101,976 | $ | 105,110 | $ | 105,609 | $ | 105,110 | ||||||||||||||
| Foreclosed real estate | 10,302 | 11,980 | 16,555 | 17,760 | 18,349 | 10,302 | 18,349 | |||||||||||||||||||||
| Total nonperforming assets (NPAs) | $ | 115,911 | $ | 120,388 | $ | 117,370 | $ | 119,736 | $ | 123,459 | $ | 115,911 | $ | 123,459 | ||||||||||||||
| Restructured loans | $ | 40,938 | $ | 39,555 | $ | 72,133 | $ | 69,975 | $ | 63,822 | $ | 40,938 | $ | 63,822 | ||||||||||||||
| Loans and leases 90 days past due | 9,190 | 9,328 | 9,757 | 8,655 | 7,203 | 9,190 | 7,203 | |||||||||||||||||||||
| Credit Quality | ||||||||||||||||||||||||||||
| NCOs / Average loans and leases | 0.34 | % | 0.28 | % | 0.33 | % | 0.50 | % | 0.30 | % | 0.31 | % | 0.46 | % | ||||||||||||||
| NPAs / Loans and leases + foreclosed real estate | 0.85 | % | 0.89 | % | 0.86 | % | 0.89 | % | 0.94 | % | 0.85 | % | 0.94 | % | ||||||||||||||
| ALLL / Nonaccrual loans and leases | 136.81 | % | 142.19 | % | 156.33 | % | 163.51 | % | 169.91 | % | 136.81 | % | 169.91 | % | ||||||||||||||
| ALLL / Total loans and leases | 1.06 | % | 1.14 | % | 1.16 | % | 1.25 | % | 1.36 | % | 1.06 | % | 1.36 | % | ||||||||||||||
| Profitability | ||||||||||||||||||||||||||||
| Return on average assets | 0.95 | % | 0.82 | % | 0.89 | % | 0.96 | % | 1.01 | % | 0.88 | % | 0.98 | % | ||||||||||||||
| Return on average equity | 6.30 | % | 5.53 | % | 6.12 | % | 6.65 | % | 6.91 | % | 5.91 | % | 6.75 | % | ||||||||||||||
| Return on average tangible equity (1) | 12.34 | % | 11.08 | % | 12.49 | % | 13.67 | % | 14.30 | % | 11.68 | % | 14.09 | % | ||||||||||||||
| Net interest margin | 3.63 | % | 3.61 | % | 3.60 | % | 3.72 | % | 3.88 | % | 3.62 | % | 3.92 | % | ||||||||||||||
| Efficiency ratio (1) | 65.63 | % | 66.18 | % | 68.84 | % | 61.62 | % | 59.57 | % | 65.90 | % | 59.87 | % | ||||||||||||||
| Per Share Data (EOP) | ||||||||||||||||||||||||||||
| Closing share price | $ | 10.56 | $ | 11.37 | $ | 12.84 | $ | 12.53 | $ | 12.85 | $ | 10.56 | $ | 12.85 | ||||||||||||||
| Stated book value per common share | 14.90 | 14.69 | 14.50 | 14.31 | 14.14 | 14.90 | 14.14 | |||||||||||||||||||||
| Tangible book value per common share (1) | 7.95 | 7.73 | 7.52 | 7.32 | 7.13 | 7.95 | 7.13 | |||||||||||||||||||||
| Price/Book Value | 70.88 | % | 77.41 | % | 88.52 | % | 87.56 | % | 90.86 | % | 70.88 | % | 90.86 | % | ||||||||||||||
| Price/Tangible Book Value | 132.83 | % | 147.09 | % | 170.74 | % | 171.17 | % | 180.22 | % | 132.83 | % | 180.22 | % | ||||||||||||||
| Number of outstanding shares ('000) | 187,706 | 187,590 | 187,363 | 187,225 | 187,023 | 187,706 | 187,023 | |||||||||||||||||||||
| Capital Ratios | ||||||||||||||||||||||||||||
| Tangible common ratio (1) | 8.88 | % | 8.67 | % | 8.44 | % | 8.22 | % | 8.21 | % | 8.88 | % | 8.21 | % | ||||||||||||||
| Tier 1 common ratio | 10.99 | % | 10.84 | % | 10.60 | % | 10.41 | % | 10.41 | % | 10.99 | % | 10.41 | % | ||||||||||||||
| Leverage ratio | 9.90 | % | 9.72 | % | 9.55 | % | 9.47 | % | 9.42 | % | 9.90 | % | 9.42 | % | ||||||||||||||
| Tier 1 capital ratio | 12.02 | % | 11.95 | % | 11.71 | % | 11.52 | % | 11.54 | % | 12.02 | % | 11.54 | % | ||||||||||||||
| Total risk-based capital ratio | 13.22 | % | 13.23 | % | 13.04 | % | 12.92 | % | 12.94 | % | 13.22 | % | 12.94 | % | ||||||||||||||
| (1) Non-GAAP based financial measures. Please refer to the calculations and management's reasons for using these measures in Appendix A - GAAP to Non-GAAP Reconciliation |
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Susquehanna Bancshares, Inc. |
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26 North Cedar Street |
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Lititz, PA 17543 |
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| CONSOLIDATED BALANCE SHEETS (UNAUDITED) | ||||||||||||||||||||
| (in thousands) | ||||||||||||||||||||
| June 30, | March 31, | December 31, | September 30, | June 30, | ||||||||||||||||
| 2014 | 2014 | 2013 | 2013 | 2013 | ||||||||||||||||
| Assets | ||||||||||||||||||||
| Cash and due from banks | $ | 456,917 | $ | 389,793 | $ | 305,357 | $ | 377,730 | $ | 367,902 | ||||||||||
| Unrestricted short-term investments | 33,369 | 24,768 | 37,967 | 30,663 | 30,759 | |||||||||||||||
| Cash and cash equivalents | 490,286 | 414,561 | 343,324 | 408,393 | 398,661 | |||||||||||||||
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Interest-bearing deposits held by consolidated variable interest entities that can be used only to settle obligations of the consolidated variable interest entities |
1,554 | 1,689 | 2,347 | 2,138 | 5,356 | |||||||||||||||
| Restricted short-term investments | 43,926 | 42,993 | 42,913 | 44,928 | 45,341 | |||||||||||||||
| Securities available for sale | 2,183,093 | 2,299,235 | 2,375,224 | 2,483,375 | 2,343,429 | |||||||||||||||
| Restricted investment in bank stocks | 141,689 | 146,087 | 158,232 | 160,787 | 150,749 | |||||||||||||||
| Loans and leases, net of deferred costs and fees | 13,600,254 | 13,505,746 | 13,503,392 | 13,300,309 | 13,005,013 | |||||||||||||||
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Loans held by consolidated variable interest entities that can be used only to settle obligations of the consolidated variable interest entities |
66,899 | 69,549 | 72,694 | 76,145 | 152,749 | |||||||||||||||
| Less: Allowance for loan and lease losses | 144,483 | 154,150 | 157,608 | 166,740 | 178,594 | |||||||||||||||
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Net loans and leases |
13,522,670 | 13,421,145 | 13,418,478 | 13,209,714 | 12,979,168 | |||||||||||||||
| Premises and equipment, net | 169,975 | 170,349 | 173,542 | 189,096 | 187,826 | |||||||||||||||
| Other real estate and foreclosed assets | 11,102 | 12,943 | 17,573 | 18,729 | 19,319 | |||||||||||||||
| Accrued interest receivable | 38,878 | 41,594 | 41,690 | 41,715 | 42,665 | |||||||||||||||
| Bank-owned life insurance | 450,318 | 449,778 | 449,320 | 449,419 | 451,278 | |||||||||||||||
| Goodwill | 1,275,439 | 1,275,439 | 1,275,439 | 1,275,439 | 1,275,439 | |||||||||||||||
| Intangible assets with finite lives | 28,579 | 30,303 | 32,262 | 33,666 | 35,737 | |||||||||||||||
| Deferred income tax assets | 7,357 | 5,216 | 6,472 | 7,921 | 7,999 | |||||||||||||||
| Other assets | 141,760 | 128,350 | 136,673 | 155,830 | 140,072 | |||||||||||||||
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Total assets |
$ | 18,506,626 | $ | 18,439,682 | $ | 18,473,489 | $ | 18,481,150 | $ | 18,083,039 | ||||||||||
| Liabilities and Shareholders' Equity | ||||||||||||||||||||
| Deposits | $ | 13,314,994 | $ | 13,079,523 | $ | 12,869,372 | $ | 12,721,685 | $ | 12,764,232 | ||||||||||
| Federal Home Loan Bank short-term borrowings | 1,050,000 | 1,150,000 | 1,450,000 | 1,510,000 | 1,070,000 | |||||||||||||||
| Other short-term borrowings | 527,079 | 584,664 | 555,740 | 688,456 | 706,065 | |||||||||||||||
| Federal Home Loan Bank long-term borrowings | 77,302 | 79,296 | 81,282 | 83,272 | 91,995 | |||||||||||||||
| Other long-term debt | 175,222 | 250,224 | 250,227 | 250,229 | 250,231 | |||||||||||||||
| Junior subordinated debentures | 146,002 | 155,022 | 155,002 | 154,983 | 154,964 | |||||||||||||||
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Long-term debt of consolidated variable interest entities for which creditors do not have recourse to Susquehanna's general credit |
38,809 | 43,275 | 48,031 | 52,592 | 83,807 | |||||||||||||||
| Accrued interest, taxes, and expenses payable | 72,664 | 69,404 | 82,150 | 101,040 | 78,211 | |||||||||||||||
| Deferred income tax liabilities | 114,119 | 75,911 | 70,308 | 52,214 | 31,694 | |||||||||||||||
| Other liabilities | 194,043 | 197,164 | 193,790 | 187,331 | 206,900 | |||||||||||||||
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Total liabilities |
15,710,234 | 15,684,483 | 15,755,902 | 15,801,802 | 15,438,099 | |||||||||||||||
| Shareholders' equity: | ||||||||||||||||||||
| Common stock | 376,146 | 375,845 | 375,353 | 374,982 | 374,566 | |||||||||||||||
| Treasury stock | (3,075 | ) | (2,735 | ) | (2,531 | ) | (1,918 | ) | (1,875 | ) | ||||||||||
| Additional paid-in capital | 1,657,699 | 1,654,357 | 1,652,116 | 1,651,382 | 1,649,636 | |||||||||||||||
| Retained earnings | 794,864 | 766,381 | 744,215 | 717,850 | 688,535 | |||||||||||||||
|
Accumulated other comprehensive loss |
(29,242 | ) | (38,649 | ) | (51,566 | ) | (62,948 | ) | (65,922 | ) | ||||||||||
|
Total shareholders' equity |
2,796,392 | 2,755,199 | 2,717,587 | 2,679,348 | 2,644,940 | |||||||||||||||
|
Total liabilities and shareholders' equity |
$ | 18,506,626 | $ | 18,439,682 | $ | 18,473,489 | $ | 18,481,150 | $ | 18,083,039 | ||||||||||
| Susquehanna Bancshares, Inc. | |||||||||||||||||
| 26 North Cedar Street | |||||||||||||||||
| Lititz, PA 17543 | |||||||||||||||||
| Loans and Leases and Deposits | |||||||||||||||||
| (in thousands) | |||||||||||||||||
| Loans and Leases | |||||||||||||||||
| 06/30/14 | 03/31/14 | 12/31/13 | 09/30/13 | 06/30/13 | |||||||||||||
| Commercial, financial, and agricultural | $ | 2,422,931 | $ | 2,411,851 | $ | 2,394,847 | $ | 2,273,735 | $ | 2,289,159 | |||||||
| Real estate - construction | 748,181 | 714,291 | 735,877 | 765,246 | 769,722 | ||||||||||||
| Real estate secured - residential | 4,178,842 | 4,178,505 | 4,204,430 | 4,145,522 | 4,098,938 | ||||||||||||
| Real estate secured - commercial | 4,053,990 | 4,041,989 | 4,068,816 | 4,109,329 | 4,029,454 | ||||||||||||
| Consumer | 962,618 | 955,577 | 953,000 | 935,117 | 908,328 | ||||||||||||
| Leases | 1,300,591 | 1,273,082 | 1,219,116 | 1,147,505 | 1,062,161 | ||||||||||||
| Total loans and leases | $ | 13,667,153 | $ | 13,575,295 | $ | 13,576,086 | $ | 13,376,454 | $ | 13,157,762 | |||||||
| Deposits | |||||||||||||||||
| 06/30/14 | 03/31/14 | 12/31/13 | 09/30/13 | 06/30/13 | |||||||||||||
| Non-interest bearing checking | $ | 1,935,635 | $ | 1,880,284 | $ | 1,913,526 | $ | 1,871,461 | $ | 1,931,874 | |||||||
| Interest-bearing checking | 2,883,679 | 2,908,507 | 2,909,376 | 2,895,027 | 2,766,831 | ||||||||||||
| Money market | 3,025,430 | 3,184,719 | 3,144,106 | 3,062,955 | 3,101,559 | ||||||||||||
| Savings | 1,136,044 | 1,132,850 | 1,077,923 | 1,065,699 | 1,086,184 | ||||||||||||
| Core deposits | 8,980,788 | 9,106,360 | 9,044,931 | 8,895,142 | 8,886,448 | ||||||||||||
| Time less than $100 | 2,266,815 | 2,166,207 | 2,113,209 | 2,103,650 | 2,152,539 | ||||||||||||
| Time of $100 or more | 2,067,391 | 1,806,956 | 1,711,232 | 1,722,893 | 1,725,245 | ||||||||||||
| Total deposits | $ | 13,314,994 | $ | 13,079,523 | $ | 12,869,372 | $ | 12,721,685 | $ | 12,764,232 | |||||||
| Susquehanna Bancshares, Inc. | |||||||||||||||||||||
| 26 North Cedar Street | |||||||||||||||||||||
| Lititz, PA 17543 | |||||||||||||||||||||
| Supplemental Loan and Lease Data | |||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||
| Nonaccrual Loans and Leases | |||||||||||||||||||||
| 06/30/14 | 03/31/14 | 12/31/13 | 09/30/13 | 06/30/13 | |||||||||||||||||
| Commercial, financial, and agricultural | $ | 18,792 | $ | 24,529 | $ | 16,827 | $ | 10,048 | $ | 10,810 | |||||||||||
| Real estate - construction | 7,428 | 11,695 | 13,230 | 16,497 | 13,243 | ||||||||||||||||
| Real estate secured - residential | 24,740 | 23,189 | 23,365 | 27,878 | 31,945 | ||||||||||||||||
| Real estate secured - commercial | 53,687 | 47,950 | 46,147 | 45,906 | 48,010 | ||||||||||||||||
| Consumer | 43 | 46 | 47 | 177 | 40 | ||||||||||||||||
| Leases | 919 | 999 | 1,199 | 1,470 | 1,062 | ||||||||||||||||
| Total nonaccrual loans and leases | $ | 105,609 | $ | 108,408 | $ | 100,815 | $ | 101,976 | $ | 105,110 | |||||||||||
| Restructured Loans | |||||||||||||||||||||
| 06/30/14 | 03/31/14 | 12/31/13 | 09/30/13 | 06/30/13 | |||||||||||||||||
| Commercial, financial, and agricultural | $ | 4,228 | $ | 5,264 | $ | 6,885 | $ | 9,609 | $ | 9,200 | |||||||||||
| Real estate - construction | 322 | 325 | 615 | 331 | 334 | ||||||||||||||||
| Real estate secured - residential | 18,414 | 16,168 | 31,623 | 26,848 | 23,207 | ||||||||||||||||
| Real estate secured - commercial | 16,903 | 16,681 | 31,295 | 31,766 | 29,482 | ||||||||||||||||
| Consumer | 1,071 | 1,117 | 1,715 | 1,421 | 1,599 | ||||||||||||||||
| Total restructured loans | $ | 40,938 | $ | 39,555 | $ | 72,133 | $ | 69,975 | $ | 63,822 | |||||||||||
| Net Charge-offs (Recoveries) | |||||||||||||||||||||
| 2Q 2014 | 1Q 2014 | 4Q 2013 | 3Q 2013 | 2Q 2013 | |||||||||||||||||
| Commercial, financial, and agricultural | $ | 7,274 | $ | 3,182 | $ | (480 | ) | $ | 3,731 | $ | 8,790 | ||||||||||
| Real estate - construction | (457 | ) | (91 | ) | (3,312 | ) | 6,504 | (555 | ) | ||||||||||||
| Real estate secured - residential | 2,453 | 2,796 | 2,724 | 3,524 | 2,006 | ||||||||||||||||
| Real estate secured - commercial | 730 | 2,134 | 11,060 | 2,007 | (1,241 | ) | |||||||||||||||
| Consumer | 1,013 | 855 | 330 | 726 | 549 | ||||||||||||||||
| Leases | 418 | 582 | 810 | 362 | 235 | ||||||||||||||||
| Total net charge-offs | $ | 11,431 | $ | 9,458 | $ | 11,132 | $ | 16,854 | $ | 9,784 | |||||||||||
| Susquehanna Bancshares, Inc. | ||||||||||||||||||||||||||
| 26 North Cedar Street | ||||||||||||||||||||||||||
| Lititz, PA 17543 | ||||||||||||||||||||||||||
| CONSOLIDATED CONDENSED STATEMENTS OF INCOME (UNAUDITED) | ||||||||||||||||||||||||||
| (in thousands, except per share data) | ||||||||||||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||||||||||||
| June 30, | March 31, | December 31, | September 30, | June 30, | June 30, | |||||||||||||||||||||
| 2014 | 2014 | 2013 | 2013 | 2013 | 2014 | 2013 | ||||||||||||||||||||
| Interest Income: | ||||||||||||||||||||||||||
| Loans and leases, including deferred costs and fees | $ | 148,002 | $ | 149,538 | $ | 151,907 | $ | 155,596 | $ | 159,986 | $ | 297,540 | $ | 320,330 | ||||||||||||
| Securities: | ||||||||||||||||||||||||||
| Taxable | 9,104 | 9,648 | 10,406 | 10,641 | 9,683 | 18,752 | 19,943 | |||||||||||||||||||
| Tax-exempt | 3,439 | 3,501 | 3,511 | 3,527 | 3,561 | 6,940 | 7,155 | |||||||||||||||||||
| Dividends | 2,134 | 1,765 | 1,649 | 1,297 | 1,146 | 3,899 | 2,312 | |||||||||||||||||||
| Short-term investments | 23 | 19 | 21 | 16 | 35 | 42 | 71 | |||||||||||||||||||
| Total interest income | 162,702 | 164,471 | 167,494 | 171,077 | 174,411 | 327,173 | 349,811 | |||||||||||||||||||
| Interest Expense: | ||||||||||||||||||||||||||
| Deposits: | ||||||||||||||||||||||||||
| Interest-bearing demand and savings | 4,031 | 3,962 | 4,202 | 4,190 | 4,513 | 7,993 | 9,414 | |||||||||||||||||||
| Time | 10,246 | 9,628 | 9,597 | 10,229 | 11,654 | 19,874 | 22,886 | |||||||||||||||||||
| Federal Home Loan Bank short-term borrowings | 4,597 | 4,621 | 4,449 | 3,915 | 3,452 | 9,218 | 6,823 | |||||||||||||||||||
| Other short-term borrowings | 2,031 | 2,100 | 2,146 | 2,242 | 2,153 | 4,131 | 4,306 | |||||||||||||||||||
| Federal Home Loan Bank long-term borrowings | 243 | 245 | 254 | 284 | 303 | 488 | 604 | |||||||||||||||||||
| Other long-term debt | (140 | ) | 3,851 | 4,158 | 4,268 | 4,239 | 3,711 | 8,475 | ||||||||||||||||||
| Total interest expense | 21,008 | 24,407 | 24,806 | 25,128 | 26,314 | 45,415 | 52,508 | |||||||||||||||||||
| Net interest income | $ | 141,694 | $ | 140,064 | $ | 142,688 | $ | 145,949 | $ | 148,097 | 281,758 | 297,303 | ||||||||||||||
| Provision for loan and lease losses | 3,000 | 6,000 | 2,000 | 5,000 | 12,000 | 9,000 | 24,000 | |||||||||||||||||||
| Net interest income, after provision for loan and lease losses | 138,694 | 134,064 | 140,688 | 140,949 | 136,097 | 272,758 | 273,303 | |||||||||||||||||||
| Noninterest Income: | ||||||||||||||||||||||||||
| Service charges on deposit accounts | 9,294 | 9,000 | 9,456 | 9,514 | 9,347 | 18,294 | 18,019 | |||||||||||||||||||
| Vehicle origination and servicing fees | 2,915 | 2,968 | 3,057 | 2,907 | 2,407 | 5,883 | 5,761 | |||||||||||||||||||
| Wealth management commissions and fees | 12,669 | 12,719 | 13,048 | 12,606 | 13,289 | 25,388 | 25,679 | |||||||||||||||||||
| Commissions on property and casualty insurance sales | 4,214 | 5,666 | 4,023 | 3,872 | 4,360 | 9,880 | 8,902 | |||||||||||||||||||
| Other commissions and fees | 5,401 | 5,035 | 5,077 | 4,885 | 4,727 | 10,436 | 9,055 | |||||||||||||||||||
| Income from bank-owned life insurance | 1,672 | 1,637 | 1,492 | 1,493 | 1,520 | 3,309 | 3,028 | |||||||||||||||||||
| Mortgage banking revenue | 3,004 | 2,410 | 2,483 | 2,237 | 3,998 | 5,414 | 8,108 | |||||||||||||||||||
| Capital markets revenue | 877 | 1,240 | 3,216 | 111 | 3,256 | 2,117 | 4,158 | |||||||||||||||||||
| Net realized gain (loss) on sales of securities | 3,293 | (8 | ) | (1,343 | ) | 2 | (71 | ) | 3,285 | (53 | ) | |||||||||||||||
| Realized gain on sale of branch properties | 0 | 0 | 4,945 | 0 | 0 | 0 | 0 | |||||||||||||||||||
| Other | 2,010 | 1,422 | 5,212 | 3,716 | 6,243 | 3,432 | 9,063 | |||||||||||||||||||
| Total noninterest income | 45,349 | 42,089 | 50,666 | 41,343 | 49,076 | 87,438 | 91,720 | |||||||||||||||||||
| Noninterest Expenses: | ||||||||||||||||||||||||||
| Salaries and employee benefits | 68,325 | 65,581 | 70,837 | 61,879 | 66,888 | 133,906 | 129,502 | |||||||||||||||||||
| Occupancy | 11,914 | 13,847 | 11,727 | 11,352 | 11,154 | 25,761 | 22,369 | |||||||||||||||||||
| Furniture and equipment | 4,058 | 3,944 | 3,865 | 3,661 | 3,747 | 8,002 | 7,325 | |||||||||||||||||||
| Professional and technology services | 7,189 | 6,070 | 6,404 | 7,173 | 5,831 | 13,259 | 11,560 | |||||||||||||||||||
| Advertising and marketing | 3,567 | 3,576 | 3,618 | 3,319 | 2,465 | 7,143 | 5,765 | |||||||||||||||||||
| FDIC insurance | 4,925 | 5,121 | 6,118 | 5,421 | 4,541 | 10,046 | 8,339 | |||||||||||||||||||
| Legal fees | 1,656 | 1,527 | 1,968 | 1,774 | 1,810 | 3,183 | 3,680 | |||||||||||||||||||
| Amortization of intangible assets | 2,367 | 2,539 | 2,803 | 2,502 | 3,053 | 4,906 | 6,321 | |||||||||||||||||||
| Vehicle lease disposal | 2,215 | 2,251 | 1,216 | 1,193 | 1,313 | 4,466 | 2,603 | |||||||||||||||||||
| Branch consolidation costs | 0 | 0 | 6,603 | 0 | 0 | 0 | 0 | |||||||||||||||||||
| Other | 19,009 | 18,576 | 20,513 | 19,427 | 18,936 | 37,585 | 40,003 | |||||||||||||||||||
| Total noninterest expenses | 125,225 | 123,032 | 135,672 | 117,701 | 119,738 | 248,257 | 237,467 | |||||||||||||||||||
| Income before income taxes | 58,818 | 53,121 | 55,682 | 64,591 | 65,435 | 111,939 | 127,556 | |||||||||||||||||||
| Provision for income taxes | 15,324 | 15,959 | 14,341 | 20,300 | 19,787 | 31,283 | 39,509 | |||||||||||||||||||
| Net Income | $ | 43,494 | $ | 37,162 | $ | 41,341 | $ | 44,291 | $ | 45,648 | $ | 80,656 | $ | 88,047 | ||||||||||||
| Earnings per common share: | ||||||||||||||||||||||||||
| Basic | $ | 0.23 | $ | 0.20 | $ | 0.22 | $ | 0.24 | $ | 0.24 | $ | 0.43 | $ | 0.47 | ||||||||||||
| Diluted | $ | 0.23 | $ | 0.20 | $ | 0.22 | $ | 0.24 | $ | 0.24 | $ | 0.43 | $ | 0.47 | ||||||||||||
| Cash dividends per common share | $ | 0.08 | $ | 0.08 | $ | 0.08 | $ | 0.08 | $ | 0.08 | $ | 0.16 | $ | 0.08 | ||||||||||||
| Average common shares outstanding: | ||||||||||||||||||||||||||
| Basic | 187,637 | 187,455 | 187,186 | 187,096 | 186,812 | 187,547 | 186,710 | |||||||||||||||||||
| Diluted | 188,295 | 188,378 | 188,078 | 188,109 | 187,723 | 188,296 | 187,612 | |||||||||||||||||||
| Susquehanna Bancshares, Inc. | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| 26 North Cedar Street | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Lititz, PA 17543 | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| DISTRIBUTION OF ASSETS, LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| (in thousands) | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Interest rates and interest differential-taxable equivalent basis | ||||||||||||||||||||||||||||||||||||||||||||||||||||
|
Three Months Ended June 30, 2014 |
Three Months Ended March 31, 2014 |
Three Months Ended June 30, 2013 |
Six Months Ended June 30, 2014 |
Six Months Ended June 30, 2013 |
||||||||||||||||||||||||||||||||||||||||||||||||
|
Average Balance |
Interest | Rate (%) |
Average Balance |
Interest | Rate (%) |
Average Balance |
Interest | Rate (%) |
Average |
Interest | Rate (%) |
Average Balance |
Interest | Rate (%) | ||||||||||||||||||||||||||||||||||||||
| Assets | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Short-term investments | $ | 80,954 | $ | 23 | 0.11 | $ | 81,747 | $ | 19 | 0.09 | $ | 106,740 | $ | 34 | 0.13 | $ | 81,909 | $ | 41 | 0.10 | $ | 108,037 | $ | 71 | 0.13 | |||||||||||||||||||||||||||
| Investment securities: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Taxable(1) | 2,013,166 | 11,238 | 2.24 | 2,117,969 | 11,413 | 2.19 | 2,107,031 | 10,830 | 2.06 | 2,065,278 | 22,651 | 2.21 | 2,154,321 | 22,256 | 2.08 | |||||||||||||||||||||||||||||||||||||
| Tax-exempt(1)(2) | 382,524 | 5,291 | 5.55 | 387,968 | 5,388 | 5.63 | 396,960 | 5,478 | 5.54 | 385,231 | 10,677 | 5.59 | 399,197 | 11,008 | 5.56 | |||||||||||||||||||||||||||||||||||||
| Total investment securities | 2,395,690 | 16,529 | 2.77 | 2,505,937 | 16,801 | 2.72 | 2,503,991 | 16,308 | 2.61 | 2,450,509 | 33,328 | 2.74 | 2,553,518 | 33,264 | 2.63 | |||||||||||||||||||||||||||||||||||||
| Loans and leases, (net): | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Taxable(3) | 13,154,917 | 144,471 | 4.40 | 13,136,268 | 146,080 | 4.51 | 12,690,334 | 156,561 | 4.95 | 13,145,644 | 290,552 | 4.46 | 12,596,683 | 313,413 | 5.02 | |||||||||||||||||||||||||||||||||||||
| Tax-exempt(2)(3) | 434,616 | 5,432 | 5.01 | 438,258 | 5,320 | 4.92 | 419,794 | 5,326 | 5.09 | 436,427 | 10,752 | 4.97 | 423,563 | 10,697 | 5.09 | |||||||||||||||||||||||||||||||||||||
| Total loans and leases | 13,589,533 | 149,903 | 4.42 | 13,574,526 | 151,400 | 4.52 | 13,110,128 | 161,887 | 4.95 | 13,582,071 | 301,304 | 4.47 | 13,020,246 | 324,110 | 5.02 | |||||||||||||||||||||||||||||||||||||
| Total interest-earning assets | 16,066,177 | 166,455 | 4.16 | 16,162,210 | 168,220 | 4.22 | 15,720,859 | 178,229 | 4.55 | 16,114,489 | 334,673 | 4.19 | 15,681,801 | 357,445 | 4.60 | |||||||||||||||||||||||||||||||||||||
| Allowance for loan and lease losses | (154,710 | ) | (157,444 | ) | (179,273 | ) | (156,070 | ) | (182,075 | ) | ||||||||||||||||||||||||||||||||||||||||||
| Other non-earning assets | 2,466,660 | 2,407,107 | 2,529,880 | 2,460,609 | 2,551,682 | |||||||||||||||||||||||||||||||||||||||||||||||
| Total assets | $ | 18,378,127 | $ | 18,411,873 | $ | 18,071,466 | $ | 18,419,028 | $ | 18,051,408 | ||||||||||||||||||||||||||||||||||||||||||
| Liabilities | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Deposits: | ||||||||||||||||||||||||||||||||||||||||||||||||||||
| Interest-bearing demand | $ | 5,998,086 | 3,726 | 0.25 | $ | 6,032,537 | 3,674 | 0.25 | $ | 5,983,543 | 4,219 | 0.28 | $ | 6,015,217 | 7,400 | 0.25 | $ | 5,939,576 | 8,842 | 0.30 | ||||||||||||||||||||||||||||||||
| Savings | 1,134,421 | 305 | 0.11 | 1,099,944 | 287 | 0.11 | 1,080,427 | 294 | 0.11 | 1,117,278 | 592 | 0.11 | 1,064,741 | 572 | 0.11 | |||||||||||||||||||||||||||||||||||||
| Time | 4,129,738 | 10,245 | 1.00 | 3,910,698 | 9,630 | 1.00 | 3,892,237 | 11,653 | 1.20 | 4,020,822 | 19,874 | 1.00 | 3,835,477 | 22,886 | 1.20 | |||||||||||||||||||||||||||||||||||||
| Other short-term borrowings | 552,367 | 2,030 | 1.47 | 671,653 | 2,101 | 1.27 | 728,497 | 2,154 | 1.19 | 611,681 | 4,131 | 1.36 | 772,910 | 4,306 | 1.12 | |||||||||||||||||||||||||||||||||||||
| FHLB borrowings | 1,174,611 | 4,840 | 1.65 | 1,387,124 | 4,866 | 1.42 | 1,041,577 | 3,754 | 1.45 | 1,280,280 | 9,706 | 1.53 | 1,098,292 | 7,427 | 1.36 | |||||||||||||||||||||||||||||||||||||
| Long-term debt(4) | 396,367 | (138 | ) | (0.14 | ) | 451,267 | 3,849 | 3.46 | 496,240 | 4,239 | 3.43 | 423,666 | 3,712 | 1.77 | 502,356 | 8,475 | 3.40 | |||||||||||||||||||||||||||||||||||
| Total interest-bearing liabilities | 13,385,590 | 21,008 | 0.63 | 13,553,223 | 24,407 | 0.73 | 13,222,521 | 26,313 | 0.80 | 13,468,944 | 45,415 | 0.68 | 13,213,352 | 52,508 | 0.80 | |||||||||||||||||||||||||||||||||||||
| Demand deposits | 1,869,372 | 1,830,861 | 1,911,667 | 1,850,223 | 1,915,046 | |||||||||||||||||||||||||||||||||||||||||||||||
| Other liabilities | 354,500 | 301,324 | 288,964 | 346,546 | 291,599 | |||||||||||||||||||||||||||||||||||||||||||||||
| Total liabilities | 15,609,462 | 15,685,408 | 15,423,152 | 15,665,713 | 15,419,997 | |||||||||||||||||||||||||||||||||||||||||||||||
| Equity | 2,768,665 | 2,726,465 | 2,648,314 | 2,753,315 | 2,631,411 | |||||||||||||||||||||||||||||||||||||||||||||||
| Total liabilities & shareholders' equity | $ | 18,378,127 | $ | 18,411,873 | $ | 18,071,466 | $ | 18,419,028 | $ | 18,051,408 | ||||||||||||||||||||||||||||||||||||||||||
|
Net interest income / yield on average earning assets |
$ | 145,447 | 3.63 | $ | 143,813 | 3.61 | $ | 151,916 | 3.88 | $ | 289,258 | 3.62 | $ | 304,937 | 3.92 | |||||||||||||||||||||||||||||||||||||
| Taxable equivalent adjustment | (3,753 | ) | (3,749 | ) | (3,819 | ) | (7,500 | ) | (7,634 | ) | ||||||||||||||||||||||||||||||||||||||||||
| Net interest income - as reported | $ | 141,694 | $ | 140,064 | $ | 148,097 | $ | 281,758 | $ | 297,303 | ||||||||||||||||||||||||||||||||||||||||||
|
(1) |
For presentation in this table, average balances and the corresponding average rates for investment securities are based upon historical cost, adjusted for amortization of premiums and accretion of discounts. |
|
|
(2) |
Tax-exempt income has been adjusted to a tax-equivalent basis using a marginal tax rate of 35%. |
|
|
(3) |
Average loan balances include non-accrual loans. |
|
|
(4) |
Includes $3.7 million purchase accounting adjustment on redemption of junior subordinated debt in second quarter of 2014. |
|
|
Susquehanna Bancshares, Inc. |
||||||||||||||||||||||||||||
|
26 North Cedar Street |
||||||||||||||||||||||||||||
|
Lititz, PA 17543 |
||||||||||||||||||||||||||||
|
Appendix A - GAAP to Non-GAAP Reconciliation |
Six Months Ended |
|||||||||||||||||||||||||||
|
(Dollars and share data in thousands) |
June 30, |
|||||||||||||||||||||||||||
|
2Q14 |
1Q14 |
4Q13 |
3Q13 |
2Q13 |
2014 |
2013 |
||||||||||||||||||||||
|
Efficiency Ratio |
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| Other expense | $ | 125,225 | $ | 123,032 | $ | 135,672 | $ | 117,701 | $ | 119,738 | $ | 248,257 | $ | 237,467 | ||||||||||||||
| Noninterest operating expense (numerator) | $ | 125,225 | $ | 123,032 | $ | 135,672 | $ | 117,701 | $ | 119,738 | $ | 248,257 | $ | 237,467 | ||||||||||||||
| Taxable-equivalent net interest income | $ | 145,447 | $ | 143,813 | $ | 146,430 | $ | 149,683 | $ | 151,916 | 289,258 | $ | 304,937 | |||||||||||||||
| Other income | 45,349 | 42,089 | 50,666 | 41,343 | 49,076 | 87,438 | 91,720 | |||||||||||||||||||||
| Noninterest operating income (denominator) | $ | 190,796 | $ | 185,902 | $ | 197,096 | $ | 191,026 | $ | 200,992 | $ | 376,696 | $ | 396,657 | ||||||||||||||
| Efficiency ratio | 65.63 | % | 66.18 | % | 68.84 | % | 61.62 | % | 59.57 | % | 65.90 | % | 59.87 | % | ||||||||||||||
| The efficiency ratio is a non-GAAP based financial measure. Management excludes merger-related expenses and certain other selected items when calculating this ratio, which is used to measure the relationship of operating expenses to revenues. | ||||||||||||||||||||||||||||
|
Tangible Common Ratio |
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| End of period balance sheet data | ||||||||||||||||||||||||||||
| Shareholders' equity | $ | 2,796,392 | $ | 2,755,199 | $ | 2,717,587 | $ | 2,679,348 | $ | 2,644,940 | $ | 2,796,392 | $ | 2,644,940 | ||||||||||||||
| Goodwill and other intangible assets (1) | (1,265,846 | ) | (1,266,403 | ) | (1,264,839 | ) | (1,263,928 | ) | (1,265,016 | ) | (1,265,846 | ) | (1,265,016 | ) | ||||||||||||||
| Tangible common equity (numerator) | $ | 1,530,546 | $ | 1,488,796 | $ | 1,452,748 | $ | 1,415,420 | $ | 1,379,924 | $ | 1,530,546 | $ | 1,379,924 | ||||||||||||||
| Assets | $ | 18,506,626 | $ | 18,439,682 | $ | 18,473,489 | $ | 18,481,150 | $ | 18,083,039 | $ | 18,506,626 | $ | 18,083,039 | ||||||||||||||
| Goodwill and other intangible assets (1) | (1,265,846 | ) | (1,266,403 | ) | (1,264,839 | ) | (1,263,928 | ) | (1,265,016 | ) | (1,265,846 | ) | (1,265,016 | ) | ||||||||||||||
| Tangible assets (denominator) | $ | 17,240,780 | $ | 17,173,279 | $ | 17,208,650 | $ | 17,217,222 | $ | 16,818,023 | $ | 17,240,780 | $ | 16,818,023 | ||||||||||||||
| Tangible common ratio | 8.88 | % | 8.67 | % | 8.44 | % | 8.22 | % | 8.21 | % | 8.88 | % | 8.21 | % | ||||||||||||||
| The tangible common ratio is a non-GAAP based financial measure using non-GAAP based amounts. The most directly comparable GAAP-based measure is the ratio of common shareholders’ equity to total assets. In order to calculate tangible common shareholders equity and assets, our management subtracts the intangible assets from both the common shareholders’ equity and total assets. Tangible common equity is then divided by the tangible assets to arrive at the ratio. Management uses the ratio to assess the strength of our capital position. | ||||||||||||||||||||||||||||
| (1) Net of applicable deferred income taxes | ||||||||||||||||||||||||||||
| Susquehanna Bancshares, Inc. | ||||||||||||||||||||||||||||
| 26 North Cedar Street | ||||||||||||||||||||||||||||
| Lititz, PA 17543 | ||||||||||||||||||||||||||||
|
Appendix A - GAAP to Non-GAAP Reconciliation |
Six Months Ended |
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(Dollars and share data in thousands) |
June 30, |
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|
2Q14 |
1Q14 |
4Q13 |
3Q13 |
2Q13 |
2014 |
2013 |
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|
Return on Average Tangible Equity |
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| Income statement data | ||||||||||||||||||||||||||||
| Net income | $ | 43,494 | $ | 37,162 | $ | 41,341 | $ | 44,291 | $ | 45,648 | $ | 80,656 | $ | 88,047 | ||||||||||||||
| Amortization of intangibles, net of taxes at 35% | 1,539 | 1,650 | 1,822 | 1,626 | 1,984 | 3,189 | 4,109 | |||||||||||||||||||||
| Net tangible income (numerator) | $ | 45,033 | $ | 38,812 | $ | 43,163 | $ | 45,917 | $ | 47,632 | $ | 83,845 | $ | 92,156 | ||||||||||||||
| Average balance sheet data | ||||||||||||||||||||||||||||
| Shareholders' equity | $ | 2,768,665 | $ | 2,726,465 | $ | 2,679,242 | $ | 2,642,806 | $ | 2,648,314 | $ | 2,753,315 | $ | 2,631,411 | ||||||||||||||
| Goodwill and other intangible assets | (1,304,736 | ) | (1,306,298 | ) | (1,308,690 | ) | (1,310,155 | ) | (1,312,257 | ) | (1,305,513 | ) | (1,312,458 | ) | ||||||||||||||
| Tangible common equity (denominator) | $ | 1,463,929 | $ | 1,420,167 | $ | 1,370,552 | $ | 1,332,651 | $ | 1,336,057 | $ | 1,447,802 | $ | 1,318,953 | ||||||||||||||
| Return on equity (GAAP basis) | 6.30 | % | 5.53 | % | 6.12 | % | 6.65 | % | 6.91 | % | 5.91 | % | 6.75 | % | ||||||||||||||
| Effect of goodwill and other intangibles | 6.04 | % | 5.55 | % | 6.37 | % | 7.02 | % | 7.39 | % | 5.77 | % | 7.34 | % | ||||||||||||||
| Return on average tangible equity | 12.34 | % | 11.08 | % | 12.49 | % | 13.67 | % | 14.30 | % | 11.68 | % | 14.09 | % | ||||||||||||||
| Return on average tangible equity is a non-GAAP based financial measure calculated using non-GAAP based amounts. The most directly comparable GAAP-based measure is return on average equity. We calculate return on average tangible equity by excluding the balance of intangible assets and their related amortization expense from our calculation of return on average equity. Management uses the return on average tangible equity in order to review our core operating results. Management believes that this is a better measure of our performance. In addition, this is consistent with the treatment by bank regulatory agencies, which excludes goodwill and other intangible assets from the calculation of risk-based capital ratios. | ||||||||||||||||||||||||||||
|
Tangible Book Value per Common Share |
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| End of period balance sheet data | ||||||||||||||||||||||||||||
| Shareholders' equity | $ | 2,796,392 | $ | 2,755,199 | $ | 2,717,587 | $ | 2,679,348 | $ | 2,644,940 | $ | 2,796,392 | $ | 2,644,940 | ||||||||||||||
| Goodwill and other intangible assets | (1,304,018 | ) | (1,305,742 | ) | (1,307,701 | ) | (1,309,105 | ) | (1,311,176 | ) | (1,304,018 | ) | (1,311,176 | ) | ||||||||||||||
| Tangible common equity (numerator) | $ | 1,492,374 | $ | 1,449,457 | $ | 1,409,886 | $ | 1,370,243 | $ | 1,333,764 | $ | 1,492,374 | $ | 1,333,764 | ||||||||||||||
| Common shares outstanding (denominator) | 187,706 | 187,590 | 187,363 | 187,225 | 187,023 | 187,706 | 187,023 | |||||||||||||||||||||
| Tangible book value per common share | $ | 7.95 | $ | 7.73 | $ | 7.52 | $ | 7.32 | $ | 7.13 | $ | 7.95 | $ | 7.13 | ||||||||||||||
| Tangible book value per share is a non-GAAP based financial measure calculated using non-GAAP based amounts. The most directly comparable GAAP based measure is book value per share. In order to calculate tangible book value per share, we divide tangible common equity, which is a non-GAAP based measure calculated as common shareholders’ equity less intangible assets, by the number of shares of common stock outstanding. In contrast, book value per share is calculated by dividing total common shareholders’ equity by the number of shares of common stock outstanding. Management uses tangible book value per share to assess our capital position and ratios. | ||||||||||||||||||||||||||||
| Susquehanna Bancshares, Inc. | |||||||||||||||
| 26 North Cedar Street | |||||||||||||||
| Lititz, PA 17543 | |||||||||||||||
| Appendix A - GAAP to Non-GAAP Reconciliation | |||||||||||||||
| 2Q14 | 1Q14 | 4Q13 | 3Q13 | 2Q13 | |||||||||||
|
Net Interest Margin (excluding purchase accounting) |
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| Reported net interest margin (GAAP basis) | 3.63 | % | 3.61 | % | 3.60 | % | 3.72 | % | 3.88 | % | |||||
| Adjustments for purchase accounting: | |||||||||||||||
| Loans and leases | -0.12 | % | -0.17 | % | -0.11 | % | -0.13 | % | -0.27 | % | |||||
| Deposits | -0.03 | % | -0.03 | % | -0.03 | % | -0.04 | % | -0.06 | % | |||||
| Borrowings | -0.10 | % | -0.01 | % | -0.01 | % | -0.01 | % | -0.01 | % | |||||
| Net Interest Margin (excluding purchase accounting) | 3.38 | % | 3.40 | % | 3.45 | % | 3.54 | % | 3.54 | % | |||||
| Net interest margin (excluding purchase accounting) is a non-GAAP based financial measure using non-GAAP based amounts. The most directly comparable GAAP based measure is net interest margin. In order to calculate net interest margin (excluding purchase accounting) we subtract the effects of amortizing/accreting purchase accounting valuation amounts from net interest income, and divide the remainder by average earning assets. Our management uses net interest margin (excluding purchase accounting) to measure and monitor the impact of the current economic environment on our net interest income and believes that this measure is more representative of our ongoing earnings power because it excludes the effect of valuation variables used to arrive at the acquisition fair value recorded on the acquisition date. We believe this non-GAAP measure, when taken together with the corresponding GAAP measure, provides meaningful supplemental information to investors regarding our performance. However, this non-GAAP measure should be considered in addition to, and not as a substitute for or preferable to, net interest margin prepared in accordance with GAAP. | |||||||||||||||
