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CST: 22/11/2019 20:03:32   

First Hawaiian, Inc. Reports Third Quarter 2019 Financial Results and Declares Dividend

29 Days ago

  • Net income of $74.2 million, or $0.56 per diluted share, core net income1 of $75.9 million or $0.57 per diluted share 1
  • Increased 2019 stock repurchase authority by $50 million to a total of $150 million
  • Board of Directors declared a quarterly dividend of $0.26 per share

HONOLULU, Oct. 24, 2019 (GLOBE NEWSWIRE) -- First Hawaiian, Inc. (NASDAQ:FHB), (“First Hawaiian” or the “Company”) today reported financial results for its quarter ended September 30, 2019.

“The bank had another solid performance in the third quarter.  Our earnings were driven by excellent credit quality and continued prudent expense management,” said Bob Harrison, Chairman, President and Chief Executive Officer.  “During the quarter we continued to improve the quality of our balance sheet as we sold over $400 million of shared national credits and reduced public time deposits, enabling us to increase the size of our stock repurchase program.”

On October 23, 2019, the Company’s Board of Directors declared a quarterly cash dividend of $0.26 per share.  The dividend will be payable on December 6, 2019 to stockholders of record at the close of business on November 25, 2019.

Third Quarter 2019 Highlights:

  • Profitability measures were excellent with ROA of 1.45%, core ROATA1,2 of 1.56%, ROE of 11.12%, and core ROATCE1,2 of 18.21%;
  • Sold $409 million of shared national credits (SNCs) at an average price of 99.7%;
  • Reduced the balance of public time deposits by $334 million and the cost of deposits fell 3 basis points to 54 basis points;
  • Reported efficiency ratio was 48.4% and core efficiency ratio1 was 47.3%;
  • Continued excellent credit quality.  The ratio of non-performing assets to total loans and leases and other real estate owned was 0.03% at the end of the third quarter;
  • No provision expense was recorded due to the reduction in the loan portfolio following the sale of the SNCs;
  • Repurchased 2.3 million shares at total cost of $59 million;
  • Announced a $50 million increase in the stock repurchase program, bringing the total repurchase authority to $150 million in 2019.

Balance Sheet

Total assets were $20.6 billion as of September 30, 2019, compared to $20.5 billion as of June 30, 2019.

Gross loans and leases were $12.8 billion as of September 30, 2019, a decrease of $421 million, or 3.2%, from $13.3 billion as of June 30, 2019.  The decrease was primarily due to the approximately $450 million reduction in SNC loans, which included $409 million of SNC loans sold and an additional $40 million of runoff in the SNC loan portfolio.

Total deposits were $16.9 billion as of September 30, 2019, an increase of $65 million, or 0.4%, from $16.8 billion as of June 30, 2019, primarily reflecting a $334 million reduction in public time deposits and the receipt of $400 million of temporary commercial deposits that were withdrawn early in the fourth quarter. 

_______________
1 Core measurements are non-GAAP financial measures.  Core excludes certain gains, expenses and one-time items.  See Tables 13 and 14 at the end of this document for reconciliations of core measurements, including core net income, core noninterest income, core efficiency ratio and core earnings per diluted share to the comparable GAAP measurements.
2 Return on Average Tangible Assets (“ROATA”) and Return on Average Tangible Common Equity (“ROATCE”) are non-GAAP financial measures.  A reconciliation of average tangible assets and average tangible stockholders’ equity to the comparable GAAP measurements is provided in Table 13 at the end of this document.

Net Interest Income

Net interest income for the third quarter of 2019 was $143.1 million, a decrease of $2.5 million, or 1.7%, compared to $145.6 million for the prior quarter.  Net interest income in the third quarter included a negative $1.7 million premium adjustment, while the second quarter included a negative $1.8 million premium adjustment. The decrease in net interest income compared to the second quarter of 2019 was primarily due to lower yields and balances on loans and investments, partially offset by lower deposit balances.

NIM was 3.19% in the third quarter of 2019, a decrease of six basis points compared to 3.25% in the second quarter of 2019.  The negative $1.7 million premium adjustment in the third quarter and the negative $1.8 million premium adjustment in the second quarter had a negative four basis point impact on the reported NIM in each quarter.

Provision Expense

No provision for credit losses was taken in the quarter ended September 30, 2019 compared to $3.9 million in the quarter ended June 30, 2019.    

Noninterest Income

Noninterest income was $50.0 million in the third quarter of 2019, an increase of $1.2 million compared to noninterest income of $48.8 million in the second quarter of 2019.     

Noninterest Expense

Noninterest expense was $93.5 million in the third quarter of 2019, essentially unchanged from $93.3 million in the second quarter of 2019. 

The efficiency ratio was 48.4% and 48.0% for the quarters ended September 30, 2019 and June 30, 2019, respectively.  Core efficiency ratio1 was 47.3% and 47.9% for the quarters ended September 30, 2019 and June 30, 2019, respectively.

Taxes

The effective tax rate was 25.5% for the quarters ended September 30, 2019 and June 30, 2019.

Asset Quality

The allowance for loan and lease losses was $133.0 million, or 1.04% of total loans and leases, as of September 30, 2019, compared to $138.5 million, or 1.04% of total loans and leases, as of June 30, 2019.  Net charge-offs were $5.6 million, or 0.17% of average loans and leases on an annualized basis for the quarter ended September 30, 2019, compared to $6.9 million, or 0.21% of average loans and leases on an annualized basis for the quarter ended June 30, 2019.  Total non-performing assets were $4.3 million, or 0.03% of total loans and leases and other real estate owned, at September 30, 2019, compared to non-performing assets of $3.9 million, or 0.03% of total loans and leases and other real estate owned, at June 30, 2019. 

Capital

Total stockholders' equity was $2.7 billion at September 30, 2019 and June 30, 2019.   

The tier 1 leverage, common equity tier 1 and total capital ratios were 8.68%, 12.15% and 13.11%, respectively, at September 30, 2019, compared with 8.75%, 11.84% and 12.81% at June 30, 2019.

During the third quarter of 2019, the Company’s Board of Directors approved a $50 million increase in the stock repurchase program to up to $150 million during 2019.  The Company repurchased 2.3 million shares of common stock at a total cost of $59 million under the stock repurchase program in the third quarter. The average cost was $25.69 per share repurchased.  Year-to-date through September 30, the Company has repurchased 3.8 million shares at a total cost of $99 million.  Remaining buyback authority under the stock repurchase program was $51 million at September 30, 2019.

First Hawaiian, Inc. 

First Hawaiian, Inc. (NASDAQ:FHB) is a bank holding company headquartered in Honolulu, Hawaii.  Its principal subsidiary, First Hawaiian Bank, founded in 1858 under the name Bishop & Company, is Hawaii’s oldest and largest financial institution with branch locations throughout Hawaii, Guam and Saipan. The company offers a comprehensive suite of banking services to consumer and commercial customers including deposit products, loans, wealth management, insurance, trust, retirement planning, credit card and merchant processing services.  Customers may also access their accounts through ATMs, online and mobile banking channels. For more information about First Hawaiian, Inc., visit the Company’s website, www.fhb.com.

Conference Call Information

First Hawaiian will host a conference call to discuss the Company’s results today at 5:00 p.m. Eastern Time, 11:00 a.m. Hawaii Time.  To access the call, participants should dial (844) 452-2942 (US/Canada), or (574) 990-9846 (International) ten minutes prior to the start of the call and enter the conference ID:  1875646.  A live webcast of the conference call, including a slide presentation, will be available at the following link:  www.fhb.com/earnings.  The archive of the webcast will be available at the same location.  A telephonic replay of the conference call will be available two hours after the conclusion of the call until 8:30 p.m. (Eastern Time) on October 31, 2019.  Access the replay by dialing (855) 859-2056 or (404) 537-3406 and entering the conference ID:  1875646.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance.  These statements are often, but not always, made through the use of words or phrases such as “may”, “might”, “should”, “could”, “predict”, “potential”, “believe”, “expect”, “continue”, “will”, “anticipate”, “seek”, “estimate”, “intend”, “plan”, “projection”, “would”, “annualized” and “outlook”, or the negative version of those words or other comparable words or phrases of a future or forward-looking nature.  These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management's beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control.  Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, estimates and uncertainties that are difficult to predict.  Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements.  For a discussion of some of the risks and important factors that could affect our future results and financial condition, see our U.S. Securities and Exchange Commission (“SEC”) filings, including, but not limited to, our Annual Report on Form 10-K for the year ended December 31, 2018 and our Quarterly Report on Form 10-Q for the quarter ended June 30, 2019.

Use of Non-GAAP Financial Measures

We present net interest income, noninterest income, noninterest expense, net income, earnings per share (basic and diluted) and the related ratios described below, on an adjusted, or ‘‘core,’’ basis, each a non-GAAP financial measure.  These core measures exclude from the corresponding GAAP measure the impact of certain items that we do not believe are representative of our financial results.  We believe that the presentation of these non-GAAP financial measures helps identify underlying trends in our business from period to period that could otherwise be distorted by the effect of certain expenses, gains and other items included in our operating results. We believe that these core measures provide useful information about our operating results and enhance the overall understanding of our past performance and future performance.  Investors should consider our performance and financial condition as reported under GAAP and all other relevant information when assessing our performance or financial condition. 

Core net interest margin, core efficiency ratio, core return on average total assets and core return on average total stockholders’ equity are non-GAAP financial measures.  We compute our core net interest margin as the ratio of core net interest income to average earning assets.  We compute our core efficiency ratio as the ratio of core noninterest expense to the sum of core net interest income and core noninterest income.  We compute our core return on average total assets as the ratio of core net income to average total assets.  We compute our core return on average total stockholders’ equity as the ratio of core net income to average total stockholders’ equity. 

Return on average tangible stockholders’ equity, core return on average tangible stockholders’ equity, return on average tangible assets, core return on average tangible assets and tangible stockholders’ equity to tangible assets are non-GAAP financial measures.  We compute our return on average tangible stockholders’ equity as the ratio of net income to average tangible stockholders’ equity, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total stockholders’ equity.  We compute our core return on average tangible stockholders’ equity as the ratio of core net income to average tangible stockholders’ equity, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total stockholders’ equity.  We compute our return on average tangible assets as the ratio of net income to average tangible assets, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total assets.  We compute our core return on average tangible assets as the ratio of core net income to average tangible assets. We compute our tangible stockholders’ equity to tangible assets as the ratio of tangible stockholders’ equity to tangible assets, each of which we calculate by subtracting (and thereby effectively excluding) the value of our goodwill. We believe that these measurements are useful for investors, regulators, management and others to evaluate financial performance and capital adequacy relative to other financial institutions.  Although these non-GAAP financial measures are frequently used by stakeholders in the evaluation of a company, they have limitations as analytical tools and should not be considered in isolation or as a substitute for analysis of our results or financial condition as reported under GAAP.

Tables 13 and 14 at the end of this document provide a reconciliation of these non-GAAP financial measures with their most directly comparable GAAP measures.

Investor Relations Contact:
Kevin Haseyama, CFA
(808) 525-6268
khaseyama@fhb.com
                              Media Contact:
Susan Kam
(808) 525-6254
skam@fhb.com
     


Financial Highlights                         Table 1  
    For the Three Months Ended   For the Nine Months Ended  
    September 30,    June 30,    September 30,    September 30,   
(dollars in thousands, except per share data)   2019   2019   2018   2019   2018  
Operating Results:                                
Net interest income   $ 143,081   $ 145,613   $ 141,258   $ 433,783   $ 422,333  
Provision for loan and lease losses         3,870     4,460     9,550     16,430  
Noninterest income     49,980     48,773     47,405     145,825     145,902  
Noninterest expense     93,466     93,290     93,147     279,379     275,599  
Net income     74,199     72,433     67,388     216,556     204,399  
Basic earnings per share     0.56     0.54     0.50     1.62     1.48  
Diluted earnings per share     0.56     0.54     0.50     1.61     1.48  
Dividends declared per share     0.26     0.26     0.24     0.78     0.72  
Dividend payout ratio     46.43 %   48.15 %   48.00 %   48.45 %   48.65 %
Supplemental Income Statement Data (non-GAAP) :                                
Core net interest income   $ 143,081   $ 145,613   $ 141,258   $ 433,783   $ 422,333  
Core noninterest income     49,980     48,752     47,405     148,417     145,902  
Core noninterest expense     91,222     93,029     88,511     276,613     269,642  
Core net income     75,871     72,612     70,818     220,535     208,797  
Core basic earnings per share     0.57     0.54     0.52     1.65     1.52  
Core diluted earnings per share     0.57     0.54     0.52     1.64     1.52  
Performance Ratio (1) :                                
Net interest margin     3.19   3.25   3.11   3.22   3.14 %
Core net interest margin (non-GAAP)     3.19   3.25   3.11   3.22   3.14 %
Efficiency ratio     48.41   47.99   49.36   48.20   48.49 %
Core efficiency ratio (non-GAAP)     47.25   47.86   46.90   47.51   47.44 %
Return on average total assets     1.45   1.42   1.31   1.42   1.35 %
Core return on average total assets (non-GAAP)     1.48   1.43   1.38   1.44   1.37 %
Return on average tangible assets (non-GAAP)     1.52   1.50   1.38   1.49   1.42 %
Core return on average tangible assets (non-GAAP)(2)     1.56   1.50   1.45   1.52   1.45 %
Return on average total stockholders' equity     11.12   11.13   11.01   11.13   11.09 %
Core return on average total stockholders' equity (non-GAAP)     11.37   11.16   11.57   11.34   11.33 %
Return on average tangible stockholders' equity (non-GAAP)     17.81   17.99   18.66   18.04   18.60 %
Core return on average tangible stockholders’ equity (non-GAAP)(3)     18.21   18.03   19.61   18.37   19.00 %
Average Balances:                                
Average loans and leases   $ 13,032,349   $ 13,209,655   $ 12,595,668   $ 13,105,086   $ 12,482,747  
Average earning assets     17,862,564     17,971,615     18,041,483     17,974,363     17,982,396  
Average assets     20,332,457     20,390,273     20,391,456     20,405,261     20,306,833  
Average deposits     16,573,796     16,664,837     17,158,849     16,700,366     17,286,159  
Average stockholders' equity     2,648,428     2,610,565     2,427,907     2,600,259     2,464,601  
Market Value Per Share:                                
  Closing     26.70     25.87     27.16     26.70     27.16  
  High     27.84     28.20     30.02     28.20     32.36  
  Low     24.25     24.83     27.02     22.13     26.92  
                                 


     As of    As of    As of    As of  
     September 30,     June 30,     December 31,     September 30,   
    2019   2019   2018   2018  
Balance Sheet Data:                          
Loans and leases   $   12,843,396   $   13,264,609   $   13,076,191   $   12,600,464  
Total assets       20,598,220       20,526,367       20,695,678       19,983,838  
Total deposits       16,857,246       16,792,078       17,150,068       16,689,273  
Short-term borrowings       400,000       200,000       —       30,000  
Long-term borrowings       200,018       400,028       600,026       400,026  
Total stockholders' equity       2,654,558       2,659,441       2,524,839       2,423,462  
                           
Per Share of Common Stock:                          
Book value   $   20.22   $   19.92   $   18.72   $   17.97  
Tangible book value (non-GAAP)(4)       12.64       12.46       11.34       10.59  
                           
Asset Quality Ratios:                          
Non-accrual loans and leases / total loans and leases       0.03     0.03 %     0.05 %     0.09
Allowance for loan and lease losses / total loans and leases       1.04     1.04 %     1.08 %     1.12
                           
Capital Ratios:                          
Common Equity Tier 1 Capital Ratio       12.15     11.84 %     11.97 %     12.09
Tier 1 Capital Ratio       12.15     11.84 %     11.97 %     12.09
Total Capital Ratio       13.11     12.81 %     12.99 %     13.14
Tier 1 Leverage Ratio       8.68     8.75 %     8.72 %     8.42
Total stockholders' equity to total assets       12.89     12.96 %     12.20 %     12.13
Tangible stockholders' equity to tangible assets (non-GAAP)       8.46     8.52 %     7.76 %     7.52
                           
Non-Financial Data:                          
Number of branches       58       59       60       60  
Number of ATMs       293       292       295       296  
Number of Full-Time Equivalent Employees       2,099       2,123       2,155       2,166  
                           


Consolidated Statements of Income   Table 2
    Three Months Ended   For the Nine Months Ended
    September 30,    June 30,    September 30,    September 30, 
(dollars in thousands, except per share amounts)   2019   2019   2018   2019   2018
Interest income                              
Loans and lease financing   $   144,691   $   146,883   $   135,394   $   435,980     $   389,228
Available-for-sale securities       22,256       24,784       25,196       71,526         81,586
Other       3,234       2,151       3,462       9,054         7,193
Total interest income       170,181       173,818       164,052       516,560         478,007
Interest expense                              
Deposits       22,753       23,693       20,205       69,643         52,824
Short-term and long-term borrowings       4,347       4,512       2,589       13,134         2,850
Total interest expense       27,100       28,205       22,794       82,777         55,674
Net interest income       143,081       145,613        141,258       433,783         422,333
Provision for loan and lease losses       —       3,870       4,460       9,550         16,430
Net interest income after provision for loan and lease losses       143,081       141,743       136,798       424,233         405,903
Noninterest income                              
Service charges on deposit accounts       8,554       8,123       7,933       24,737         23,609
Credit and debit card fees       16,839       16,629       16,535       50,123         48,961
Other service charges and fees       8,903       9,403       9,578       27,435         28,553
Trust and investment services income       8,698       8,931       7,487       26,247         23,429
Bank-owned life insurance       5,743       3,390       3,692       12,946         8,131
Investment securities gains (losses), net       —       21       —       (2,592 )       —
Other       1,243       2,276       2,180       6,929         13,219
Total noninterest income       49,980       48,773       47,405       145,825         145,902
Noninterest expense                              
Salaries and employee benefits       44,955       42,185       41,959       132,000         125,755
Contracted services and professional fees       14,649       14,303       11,478       42,597         36,770
Occupancy       7,250       7,286       6,757       21,522         20,149
Equipment       4,024       4,544       4,181       12,852         13,104
Regulatory assessment and fees       1,992       2,149       3,966       5,588         12,164
Advertising and marketing       1,647       1,980       1,060       5,593         3,126
Card rewards program       6,930       7,664       5,805       21,326         17,882
Other       12,019       13,179       17,941       37,901         46,649
Total noninterest expense       93,466       93,290       93,147       279,379         275,599
Income before provision for income taxes       99,595       97,226       91,056       290,679         276,206
Provision for income taxes       25,396       24,793       23,668       74,123         71,807
Net income   $   74,199   $   72,433   $   67,388   $   216,556     $   204,399
Basic earnings per share   $   0.56   $    0.54   $   0.50   $   1.62     $   1.48
Diluted earnings per share   $   0.56   $   0.54   $   0.50   $   1.61     $   1.48
Basic weighted-average outstanding shares       132,583,902       134,420,380       135,466,669       133,957,192         137,643,005
Diluted weighted-average outstanding shares       132,877,769       134,652,008       135,675,498       134,231,762         137,809,573
                                 


Consolidated Balance Sheets   Table 3
    September 30,    June 30,    December 31,    September 30, 
(dollars in thousands)   2019   2019   2018   2018
Assets                        
Cash and due from banks   $ 358,863     $ 423,802     $ 396,836     $ 350,967  
Interest-bearing deposits in other banks     985,154       259,713       606,801       348,526  
Investment securities     4,157,082       4,395,476       4,498,342       4,595,301  
Loans held for sale     1,594       215       432        
Loans and leases     12,843,396       13,264,609       13,076,191       12,600,464  
Less: allowance for loan and lease losses     132,964       138,535       141,718       141,250  
Net loans and leases     12,710,432       13,126,074       12,934,473       12,459,214  
                         
Premises and equipment, net     315,309       313,200       304,996       286,374  
Other real estate owned and repossessed personal property     82             751       362  
Accrued interest receivable     44,671       49,205       48,920       49,407  
Bank-owned life insurance     453,410       450,722       446,076       444,987  
Goodwill     995,492       995,492       995,492       995,492  
Mortgage servicing rights     13,630       14,573       16,155       16,937  
Other assets     562,501       497,895       446,404       436,271  
Total assets   $ 20,598,220     $ 20,526,367     $ 20,695,678     $ 19,983,838  
Liabilities and Stockholders' Equity                        
Deposits:                        
Interest-bearing   $ 11,136,424     $ 11,028,921     $ 11,142,127     $ 10,881,918  
Noninterest-bearing     5,720,822       5,763,157       6,007,941       5,807,355  
Total deposits     16,857,246       16,792,078       17,150,068       16,689,273  
Short-term borrowings     400,000       200,000             30,000  
Long-term borrowings     200,018       400,028       600,026       400,026  
Retirement benefits payable     128,442       128,610       127,909       135,523  
Other liabilities     357,956       346,210       292,836       305,554  
Total liabilities     17,943,662       17,866,926       18,170,839       17,560,376  
                         
Stockholders' equity                        
Common stock ($0.01 par value; authorized 300,000,000 shares; issued/outstanding: 139,908,699 / 131,260,900 shares as of September 30, 2019, issued/outstanding: 139,857,673 / 133,508,212 shares as of June 30, 2019, issued/outstanding: 139,656,674 / 134,874,302 shares as of December 31, 2018 and issued/outstanding: 139,655,841 / 134,873,728 shares as of September 30, 2018)                1,399       1,399       1,397       1,397  
Additional paid-in capital     2,501,324       2,499,946       2,495,853       2,494,436  
Retained earnings     403,317       363,748       291,919       264,463  
Accumulated other comprehensive loss, net     (18,774 )     (31,984 )     (132,195 )     (204,699 )
Treasury stock (8,647,799 shares as of September 30, 2019, 6,349,461 shares as of June 30, 2019, 4,782,372 shares as of December 31, 2018 and 4,782,113 shares as of September 30, 2018)     (232,708 )     (173,668 )     (132,135 )     (132,135 )
Total stockholders' equity     2,654,558       2,659,441       2,524,839       2,423,462  
Total liabilities and stockholders' equity   $ 20,598,220     $ 20,526,367     $ 20,695,678     $ 19,983,838  
                                 


Average Balances and Interest Rates                                              Table 4  
    Three Months Ended   Three Months Ended   Three Months Ended  
    September 30, 2019   June 30, 2019   September 30, 2018  
     Average    Income/    Yield/    Average    Income/    Yield/    Average    Income/    Yield/  
(dollars in millions)    Balance    Expense    Rate    Balance    Expense    Rate    Balance    Expense    Rate  
Earning Assets                                                  
Interest-Bearing Deposits in Other Banks   $   447.8   $   2.3     2.02 $   247.2   $   1.4     2.35 $   656.7   $   3.3     1.99 %
Available-for-Sale Investment Securities       4,296.3       22.3     2.07       4,438.1       24.8     2.23       4,737.3       25.2     2.11  
Loans Held for Sale       1.4       —     2.36       0.7       —     2.76       1.8       —     3.83  
Loans and Leases(1)                                                  
Commercial and industrial       2,885.9       30.0     4.12       3,235.0       34.3     4.26       3,019.9       31.0     4.08  
Commercial real estate       3,294.7       37.3     4.49       3,094.4       36.0     4.67       2,975.3       31.0     4.13  
Construction       477.2       5.6     4.67       583.6       6.9     4.73       629.5       6.7     4.20  
Residential:                                                  
Residential mortgages       3,644.9       38.6     4.23       3,581.2       37.2     4.16       3,288.4       34.9     4.21  
Home equity lines       912.8       8.6     3.74       908.5       8.6     3.79       870.6       8.2     3.72  
Consumer       1,651.4       23.3     5.61       1,657.7       22.7     5.48       1,649.7       22.4     5.39  
Lease financing       165.4       1.3     3.14       149.3       1.2     3.31       162.3       1.2     3.00  
Total Loans and Leases       13,032.3       144.7     4.41       13,209.7       146.9     4.46       12,595.7       135.4     4.26  
Other Earning Assets       84.8       0.9     4.47       76.0       0.7     3.71       50.0       0.2     1.29  
Total Earning Assets(2)       17,862.6       170.2     3.79       17,971.7       173.8     3.88       18,041.5       164.1     3.61  
Cash and Due from Banks       341.7                 342.6                 336.5            
Other Assets       2,128.2                 2,076.0                 2,013.5            
Total Assets   $   20,332.5             $   20,390.3             $   20,391.5            
                                                   
Interest-Bearing Liabilities                                                  
Interest-Bearing Deposits                                                  
Savings   $   4,891.5   $   4.6     0.37 $   4,712.2   $   4.0     0.34     4,727.2   $   3.3     0.28 %
Money Market       3,067.4       7.1     0.92       3,126.7       7.4     0.95       2,871.0       4.6     0.63  
Time       2,872.6       11.1     1.54       3,084.6       12.3     1.60       3,705.7       12.3     1.32  
Total Interest-Bearing Deposits       10,831.5       22.8     0.83       10,923.5       23.7     0.87       11,303.9       20.2     0.71  
Short-Term Borrowings       370.0       2.6     2.84       50.4       0.3     2.25       3.3       —     1.30  
Long-Term Borrowings       239.1       1.7     2.82       593.5       4.2     2.86       358.7       2.6     2.85  
Total Interest-Bearing Liabilities       11,440.6       27.1     0.94       11,567.4       28.2     0.98       11,665.9       22.8     0.78  
Net Interest Income         $   143.1             $   145.6             $   141.3      
Interest Rate Spread                 2.85               2.90               2.83 %
Net Interest Margin                 3.19               3.25               3.11 %
Noninterest-Bearing Demand Deposits       5,742.3                 5,741.3                 5,854.9            
Other Liabilities       501.2                 471.0                 442.8            
Stockholders' Equity       2,648.4                 2,610.6                 2,427.9            
Total Liabilities and Stockholders' Equity   $   20,332.5             $   20,390.3             $   20,391.5            
                                                   


Average Balances and Interest Rates                                Table 5  
    Nine Months Ended   Nine Months Ended  
    September 30, 2019   September 30, 2018  
     Average    Income/    Yield/    Average    Income/    Yield/  
(dollars in millions)    Balance    Expense    Rate    Balance    Expense    Rate  
Earning Assets                                  
Interest-Bearing Deposits in Other Banks   $   400.6   $   6.9     2.31 $   518.4   $   6.9     1.77 %
Available-for-Sale Investment Securities       4,383.6       71.5     2.18       4,951.4       81.6     2.20  
Loans Held for Sale       0.8       —     2.52       1.3       —     3.60  
Loans and Leases(1)                                  
Commercial and industrial       3,094.8       97.5     4.21       3,100.1       89.2     3.85  
Commercial real estate       3,129.8       108.1     4.62       2,886.7       86.3     4.00  
Construction       565.2       20.0     4.73       623.9       18.6     4.00  
Residential:                                  
Residential mortgages       3,590.2       112.4     4.17       3,221.7       102.4     4.25  
Home equity lines       912.4       25.9     3.79       864.0       23.6     3.65  
Consumer       1,658.7       68.5     5.52       1,625.0       65.5     5.38  
Lease financing       154.0       3.6     3.15       161.3       3.6     2.98  
Total Loans and Leases       13,105.1       436.0     4.44       12,482.7       389.2     4.17  
Other Earning Assets       84.3       2.2     3.37       28.6       0.3     1.58  
Total Earning Assets(2)       17,974.4       516.6     3.84       17,982.4       478.0     3.55  
Cash and Due from Banks       348.1                 324.4            
Other Assets       2,082.8                 2,000.0            
Total Assets   $   20,405.3             $   20,306.8            
                                   
Interest-Bearing Liabilities                                  
Interest-Bearing Deposits                                  
Savings   $   4,806.0   $   12.8     0.35 $   4,615.1   $   7.4     0.21 %
Money Market       3,125.5       22.1     0.95       2,769.9       9.1     0.44  
Time       2,999.0       34.8     1.55       3,985.2       36.3     1.22  
Total Interest-Bearing Deposits       10,930.5       69.7     0.85       11,370.2       52.8     0.62  
Short-Term Borrowings       145.7       3.0     2.76       15.3       0.2     1.81  
Long-Term Borrowings       476.2       10.1     2.84       123.1       2.7     2.87  
Total Interest-Bearing Liabilities       11,552.4       82.8     0.96       11,508.6       55.7     0.65  
Net Interest Income         $   433.8             $   422.3      
Interest Rate Spread                 2.88               2.90 %
Net Interest Margin                 3.22               3.14 %
Noninterest-Bearing Demand Deposits       5,769.9                 5,916.0            
Other Liabilities       482.7                 417.6            
Stockholders' Equity       2,600.3                 2,464.6            
Total Liabilities and Stockholders' Equity   $   20,405.3             $   20,306.8            
                                   


Analysis of Change in Net Interest Income                  Table 6
    Three Months Ended September 30, 2019
    Compared to June 30, 2019
(dollars in millions)    Volume    Rate   Total
Change in Interest Income:                  
Interest-Bearing Deposits in Other Banks   $   1.1     $   (0.2 )   $   0.9  
Available-for-Sale Investment Securities       (0.8 )       (1.7 )       (2.5 )
Loans and Leases                  
Commercial and industrial       (3.3 )       (1.0 )       (4.3 )
Commercial real estate       2.6         (1.3 )       1.3  
Construction       (1.2 )       (0.1 )       (1.3 )
Residential:                  
Residential mortgage       0.7         0.7         1.4  
Home equity line       0.1         (0.1 )       —  
Consumer       (0.1 )       0.7         0.6  
Lease financing       0.1         —         0.1  
Total Loans and Leases       (1.1 )       (1.1 )       (2.2 )
Other Earning Assets       0.1         0.1         0.2  
Total Change in Interest Income       (0.7 )       (2.9 )       (3.6 )
                   
Change in Interest Expense:                  
Interest-Bearing Deposits                  
Savings       0.2         0.4         0.6  
Money Market       (0.1 )       (0.2 )       (0.3 )
Time       (0.8 )       (0.4 )       (1.2 )
Total Interest-Bearing Deposits       (0.7 )       (0.2 )       (0.9 )
Short-Term Borrowings       2.3         —         2.3  
Long-Term Borrowings       (2.5 )       —         (2.5 )
Total Change in Interest Expense       (0.9 )       (0.2 )       (1.1 )
Change in Net Interest Income   $   0.2     $   (2.7 )   $   (2.5 )


Analysis of Change in Net Interest Income                  Table 7
    Three Months Ended September 30, 2019
    Compared to September 30, 2018
(dollars in millions)    Volume    Rate   Total
Change in Interest Income:                  
Interest-Bearing Deposits in Other Banks   $   (1.0 )   $   —     $   (1.0 )
Available-for-Sale Investment Securities       (2.4 )       (0.5 )       (2.9 )
Loans and Leases                  
Commercial and industrial       (1.4 )       0.4         (1.0 )
Commercial real estate       3.5         2.8         6.3  
Construction       (1.7 )       0.6         (1.1 )
Residential:                  
Residential mortgage       3.5         0.2         3.7  
Home equity line       0.4         —         0.4  
Consumer       —         0.9         0.9  
Lease financing       —         0.1         0.1  
Total Loans and Leases       4.3         5.0         9.3  
Other Earning Assets       0.1         0.6         0.7  
Total Change in Interest Income       1.0         5.1         6.1  
                   
Change in Interest Expense:                  
Interest-Bearing Deposits                  
Savings       0.1         1.2         1.3  
Money Market       0.3         2.2         2.5  
Time       (3.0 )       1.8         (1.2 )
Total Interest-Bearing Deposits       (2.6 )       5.2         2.6  
Short-Term Borrowings       2.6         —         2.6  
Long-Term Borrowings       (0.9 )       —         (0.9 )
Total Change in Interest Expense       (0.9 )       5.2         4.3  
Change in Net Interest Income   $   1.9     $   (0.1 )   $   1.8  
                         


Analysis of Change in Net Interest Income                  Table 8
    Nine Months Ended September 30, 2019
    Compared to September 30, 2018
(dollars in millions)    Volume    Rate   Total
Change in Interest Income:                  
Interest-Bearing Deposits in Other Banks   $   (1.8 )   $   1.8     $   —  
Available-for-Sale Investment Securities       (9.2 )       (0.9 )       (10.1 )
Loans and Leases                  
Commercial and industrial       (0.2 )       8.5         8.3  
Commercial real estate       7.7         14.1         21.8  
Construction       (1.8 )       3.2         1.4  
Residential:                  
Residential mortgage       11.9         (1.9 )       10.0  
Home equity line       1.4         0.9         2.3  
Consumer       1.3         1.7         3.0  
Lease financing       (0.2 )       0.2         —  
Total Loans and Leases       20.1         26.7         46.8  
Other Earning Assets       1.2         0.7         1.9  
Total Change in Interest Income       10.3         28.3         38.6  
                   
Change in Interest Expense:                  
Interest-Bearing Deposits                  
Savings       0.3         5.1         5.4  
Money Market       1.3         11.7         13.0  
Time       (10.1 )       8.6         (1.5 )
Total Interest-Bearing Deposits       (8.5 )       25.4         16.9  
Short-Term Borrowings       2.6         0.2         2.8  
Long-Term Borrowings       7.5         (0.1 )       7.4  
Total Change in Interest Expense       1.6         25.5         27.1  
Change in Net Interest Income   $   8.7     $   2.8     $   11.5  
                         


Loans and Leases                       Table 9
    September 30,    June 30,    December 31,    September 30, 
(dollars in thousands)   2019   2019   2018   2018
Commercial and industrial   $   2,654,077   $   3,177,844   $   3,208,760   $   2,969,237
Commercial real estate       3,309,389       3,194,219       2,990,783       2,891,753
Construction       486,977       549,578       626,757       612,794
Residential:                        
Residential mortgage       3,671,424       3,618,433       3,527,101       3,423,115
Home equity line       916,106       908,452       912,517       890,374
Total residential       4,587,530       4,526,885       4,439,618       4,313,489
Consumer       1,637,549       1,650,713       1,662,504       1,651,877
Lease financing       167,874       165,370       147,769       161,314
Total loans and leases   $   12,843,396   $   13,264,609   $   13,076,191   $   12,600,464
                         


Deposits                       Table 10
    September 30,    June 30,    December 31,    September 30, 
(dollars in thousands)   2019   2019   2018   2018
Demand   $   5,720,822   $ 5,763,157   $ 6,007,941   $ 5,807,355
Savings       4,899,468     4,908,000     4,853,285     4,685,460
Money Market       3,529,363     3,050,843     3,196,678     2,905,959
Time       2,707,593     3,070,078     3,092,164     3,290,499
  Total Deposits   $   16,857,246   $ 16,792,078   $ 17,150,068   $ 16,689,273
                         


Non-Performing Assets and Accruing Loans and Leases Past Due 90 Days or More                       Table 11
    September 30,    June 30,    December 31,    September 30, 
(dollars in thousands)   2019   2019   2018   2018
Non-Performing Assets                        
Non-Accrual Loans and Leases                        
Commercial Loans:                        
Commercial and industrial   $   12   $   119   $   274   $   481
Commercial real estate       33       —       1,658       2,786
Construction       —       —       —       2,001
Total Commercial Loans       45       119       1,932       5,268
Residential Loans:                        
Residential mortgage       3,959       3,771       4,611       5,678
Total Residential Loans       3,959       3,771       4,611       5,678
Consumer       200       —       —       —
Total Non-Accrual Loans and Leases       4,204       3,890       6,543       10,946
Other Real Estate Owned       82       —       751       362
Total Non-Performing Assets   $   4,286   $   3,890   $   7,294   $   11,308
                         
Accruing Loans and Leases Past Due 90 Days or More                        
Commercial Loans:                        
Commercial and industrial   $   750   $   807   $   141   $   141
Construction       —       —       —       172
Total Commercial Loans       750       807       141       313
Residential Loans:                        
Residential mortgage       139       —       32       168
Home equity line       3,192       1,635       2,842       2,620
Total Residential Loans       3,331       1,635       2,874       2,788
Consumer       3,076       3,295       3,373       2,813
Total Accruing Loans and Leases Past Due 90 Days or More   $   7,157   $   5,737   $   6,388   $   5,914
                         
Restructured Loans on Accrual Status and Not Past Due 90 Days or More       22,350       23,466       24,033       28,608
Total Loans and Leases   $   12,843,396   $   13,264,609   $   13,076,191   $   12,600,464
                         


Allowance for Loan and Lease Losses                             Table 12
    For the Three Months Ended   For the Nine Months Ended
    September 30,    June 30,    September 30,    September 30,    September 30, 
(dollars in thousands)   2019   2019   2018   2019   2018
Balance at Beginning of Period   $   138,535     $ 141,546     $ 140,601     $   141,718     $ 137,253  
Loans and Leases Charged-Off                              
Commercial Loans:                              
Commercial and industrial       (514 )     (2,000 )     (303 )       (2,514 )     (778 )
Lease financing       —                     (24 )      
Total Commercial Loans       (514 )     (2,000 )     (303 )       (2,538 )     (778 )
Residential       (7 )           (125 )       (7 )     (159 )
Consumer       (8,015 )     (7,505 )     (5,700 )       (24,118 )     (18,615 )
Total Loans and Leases Charged-Off       (8,536 )     (9,505 )     (6,128 )       (26,663 )     (19,552 )
Recoveries on Loans and Leases Previously Charged-Off                              
Commercial Loans:                              
Commercial and industrial       241       25       51         303       154  
Commercial real estate       30       32       21         93       175  
Total Commercial Loans       271       57       72         396       329  
Residential       425       185       442         860       684  
Consumer       2,269       2,382       1,803         7,103       6,106  
Total Recoveries on Loans and Leases Previously Charged-Off       2,965       2,624       2,317         8,359       7,119  
Net Loans and Leases Charged-Off       (5,571 )     (6,881 )     (3,811 )       (18,304 )     (12,433 )
Provision for Loan and Lease Losses       —       3,870       4,460         9,550       16,430  
Balance at End of Period   $   132,964     $ 138,535     $ 141,250     $   132,964     $ 141,250  
Average Loans and Leases Outstanding   $   13,032,349     $ 13,209,655     $ 12,595,668     $   13,105,086     $ 12,482,747  
Ratio of Net Loans and Leases Charged-Off to Average Loans and Leases Outstanding       0.17 %   0.21 %   0.12 %     0.19 %   0.13 %
Ratio of Allowance for Loan and Lease Losses to Loans and Leases Outstanding       1.04 %   1.04 %   1.12 %     1.04 %   1.12 %
                                 


GAAP to Non-GAAP Reconciliation                     Table 13  
    For the Three Months Ended   For the Nine Months Ended  
    September 30,    June 30,    September 30,    September 30,   
(dollars in thousands, except per share amounts)   2019   2019   2018   2019   2018  
Income Statement Data:                                
Net income   $   74,199   $   72,433   $   67,388   $   216,556   $   204,399  
Core net income   $   75,871   $   72,612   $   70,818   $   220,535   $   208,797  
                                 
Average total stockholders' equity   $   2,648,428   $   2,610,565   $   2,427,907   $   2,600,259   $   2,464,601  
Less: average goodwill       995,492       995,492       995,492       995,492       995,492  
Average tangible stockholders' equity   $   1,652,936   $   1,615,073   $    1,432,415   $   1,604,767   $   1,469,109  
                                 
Average total assets   $   20,332,457   $   20,390,273   $   20,391,456   $   20,405,261   $   20,306,833  
Less: average goodwill       995,492       995,492       995,492       995,492       995,492  
Average tangible assets   $   19,336,965   $   19,394,781   $   19,395,964   $   19,409,769   $   19,311,341  
                                 
Return on average total stockholders' equity(1)       11.12     11.13     11.01     11.13     11.09
Core return on average total stockholders' equity (non-GAAP)(1)       11.37     11.16     11.57     11.34     11.33
Return on average tangible stockholders' equity (non-GAAP)(1)       17.81     17.99     18.66     18.04     18.60
Core return on average tangible stockholders' equity (non-GAAP)(1)       18.21     18.03     19.61     18.37     19.00
                                 
Return on average total assets(1)       1.45     1.42     1.31     1.42     1.35
Core return on average total assets (non-GAAP)(1)       1.48     1.43     1.38     1.44     1.37
Return on average tangible assets (non-GAAP)(1)       1.52     1.50     1.38     1.49     1.42
Core return on average tangible assets (non-GAAP)(1)       1.56     1.50     1.45     1.52     1.45
                                 
           As of    As of    As of    As of  
          September 30,    June 30,    December 31,    September 30,   
          2019   2019   2018   2018  
Balance Sheet Data:                                
Total stockholders' equity         $   2,654,558   $   2,659,441   $   2,524,839   $   2,423,462  
Less: goodwill             995,492       995,492       995,492       995,492  
Tangible stockholders' equity         $   1,659,066   $   1,663,949   $   1,529,347   $   1,427,970  
                                 
Total assets         $   20,598,220   $   20,526,367   $   20,695,678   $   19,983,838  
Less: goodwill             995,492       995,492       995,492       995,492  
Tangible assets         $   19,602,728   $   19,530,875   $   19,700,186   $   18,988,346  
                                 
Shares outstanding             131,260,900       133,508,212       134,874,302       134,873,728  
                                 
Total stockholders' equity to total assets             12.89     12.96     12.20     12.13 %
Tangible stockholders' equity to tangible assets (non-GAAP)             8.46     8.52     7.76     7.52 %
                                 
Book value per share         $   20.22   $   19.92   $   18.72   $   17.97  
Tangible book value per share (non-GAAP)         $   12.64   $   12.46   $   11.34   $   10.59  
                                 


GAAP to Non-GAAP Reconciliation                             Table 14
    For the Three Months Ended   For the Nine Months Ended
    September 30,    June 30,    September 30,    September 30, 
(dollars in thousands, except per share amounts)   2019   2019   2018   2019   2018
Net interest income   $   143,081     $   145,613     $   141,258     $   433,783     $   422,333  
Core net interest income (non-GAAP)   $   143,081     $   145,613     $   141,258     $   433,783     $   422,333  
                               
Noninterest income   $   49,980     $   48,773     $   47,405     $   145,825     $   145,902  
(Gain) loss on sale of securities       —         (21 )       —         2,592         —  
Core noninterest income (non-GAAP)   $   49,980     $   48,752     $   47,405     $   148,417     $   145,902  
                               
Noninterest expense   $   93,466     $   93,290     $   93,147     $   279,379     $   275,599  
Loss on litigation settlement(1)       —         —         (4,125 )       —         (4,125 )
One-time items(2)       (2,244 )       (261 )       (511 )       (2,766 )       (1,832 )
Core noninterest expense (non-GAAP)   $   91,222     $   93,029     $   88,511     $   276,613     $   269,642  
                               
Net income   $   74,199     $   72,433     $   67,388     $   216,556     $   204,399  
(Gain) loss on sale of securities       —         (21 )       —         2,592         —  
Loss on litigation settlement(1)       —         —         4,125         —         4,125  
One-time noninterest expense items(2)       2,244         261         511         2,766         1,832  
Tax adjustments(3)       (572 )       (61 )       (1,206 )       (1,379 )       (1,559 )
Total core adjustments       1,672         179         3,430         3,979         4,398  
Core net income (non-GAAP)   $   75,871     $   72,612     $   70,818     $   220,535     $   208,797  
                               
Basic earnings per share   $   0.56     $   0.54     $   0.50     $    1.62     $   1.48  
Diluted earnings per share   $   0.56     $   0.54     $   0.50     $   1.61     $   1.48  
Efficiency ratio       48.41 %       47.99 %       49.36 %       48.20 %       48.49 %
                               
Core basic earnings per share (non-GAAP)   $   0.57     $   0.54     $   0.52     $   1.65     $   1.52  
Core diluted earnings per share (non-GAAP)   $   0.57     $   0.54     $   0.52     $   1.64     $   1.52  
Core efficiency ratio (non-GAAP)       47.25 %       47.86 %       46.90 %       47.51 %       47.44 %
                                         

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