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Columbia Banking System Announces Fourth Quarter and Full Year 2018 Results, Quarterly and Special Cash Dividends

TACOMA, Wash., Jan. 24, 2019 /PRNewswire/ --

Columbia Banking System Logo. (PRNewsFoto/Columbia Banking System, Inc.)

Highlights

  • Record full year 2018 net income of $172.9 million; diluted earnings per share of $2.36
  • Fourth quarter net income of $44.7 million; diluted earnings per share of $0.61, which included $0.01 per share negative impact from acquisition-related expenses
  • Record full year production of $1.43 billion and fourth quarter loan production of $388.4 million
  • Deposit costs increased modestly but remained low at 15 basis points
  • Nonperforming assets to period end assets ratio decreased to 0.46%
  • Regular cash dividend increased to $0.28 while special cash dividend maintained at $0.14

Hadley Robbins, President and Chief Executive Officer of Columbia Banking System and Columbia Bank (COLB) ("Columbia"), said today upon the release of Columbia's fourth quarter 2018 earnings, "We had a record year in terms of net income and loan production. Our bankers did an exceptional job in a very competitive environment. We maintained a strong core deposit mix and low funding costs and actively managed our credit exposures, resulting in low levels of nonperforming assets."

Balance Sheet

Total assets at December 31, 2018 were $13.10 billion, an increase of $138.5 million from September 30, 2018. Loans were $8.39 billion, down $122.8 million from September 30, 2018 as loan originations of $388.4 million were offset by pay-downs and prepayments. Debt securities available for sale were $3.17 billion at December 31, 2018, an increase of $246.3 million, or 8% from $2.92 billion at September 30, 2018. Total deposits at December 31, 2018 were $10.46 billion, a decrease of $145.8 million from September 30, 2018 due to seasonal decline. Core deposits comprised 95% of total deposits and were $9.97 billion at December 31, 2018, a decrease of $110.8 million from September 30, 2018. Deposit mix remained consistent from September 30, 2018 with 50% noninterest bearing and 50% interest bearing. The average cost of total deposits for the quarter was 0.15%, an increase of 3 basis points from the third quarter of 2018.

Clint Stein, Columbia's Executive Vice President and Chief Operating Officer, stated, "We experienced our usual balance sheet seasonality during the fourth quarter.  The deposit portfolio is holding up well with no meaningful rate related attrition. The decrease in the loan portfolio was mostly related to reduced line utilization." Mr. Stein continued, "While elevated prepayments were still a factor during the quarter, they continued to moderate from levels experienced during the first half of 2018."

Income Statement

Net Interest Income

Net interest income for the fourth quarter of 2018 was $123.9 million, an increase of $1.1 million from the linked quarter and an increase of $17.7 million from the prior year period. The increase from the linked quarter was due to a combination of higher rates on earning assets and higher volumes of taxable securities. The increase from the prior year period was primarily due to income from earning assets acquired in the Pacific Continental acquisition, which closed on November 1, 2017, as well as higher rates on earning assets. For additional information regarding net interest income, see the "Net Interest Margin" section and the "Average Balances and Rates" table.

Noninterest Income

Noninterest income was $20.4 million for the fourth quarter of 2018, a decrease of $617 thousand from the third quarter of 2018. The linked quarter decrease was principally due to lower loan revenue. Compared to the fourth quarter of 2017, noninterest income decreased by $3.2 million. The decrease from the prior year period was due to lower card revenue during the current quarter as we became subject to the interchange fee cap imposed under the Dodd-Frank Wall Street Reform and Consumer Protection Act's Durbin Amendment as of July 1, 2018. Also contributing to the decrease in noninterest income compared to the prior year period was our change to net presentation of interchange revenue pursuant to the adoption of new revenue recognition accounting guidance on January 1, 2018. Specifically, $1.2 million of payment card network expenses that would have historically been presented in other noninterest expense are now presented in card revenue.

Noninterest Expense

Total noninterest expense for the fourth quarter of 2018 was $87.0 million, an increase of $4.2 million from the third quarter of 2018. After removing the effect of acquisition-related expenses for the current quarter and the linked quarter, noninterest expense increased $4.8 million due to higher compensation and employee benefits and legal and professional fees. The increase in compensation and employee benefits expense was driven in part by higher health insurance expense and higher payroll costs associated with an additional day within the current quarter. The increase in legal and professional expense was due to implementation and consulting costs related to our digital strategy and other projects. Compared to the fourth quarter of 2017, noninterest expense increased by $1.4 million. After removing the acquisition-related expenses of $13.6 million from the fourth quarter of 2017, noninterest expense increased $14.5 million. This increase was primarily driven by higher compensation and employee benefits and legal expense resulting from the Pacific Continental acquisition.

Provision for Income Taxes

Our effective tax rate for the current quarter was 19.3%, compared to 19.7% and 61.5% for the linked and prior year periods, respectively. The decrease from the prior year period was principally attributable to the re-measurement charge of $12.2 million to reduce our deferred tax assets as a result of the enactment of the Tax Cuts and Jobs Act on December 22, 2017, which lowered the corporate tax rate to 21% from 35%. The prior year period's effective tax rate reflected the then-enacted 35% corporate tax rate reduced by favorable tax attributes of certain earning assets and discrete tax benefits from share-based compensation.

Our effective tax rate remains below the statutory tax rate due to tax-exempt income from municipal securities, bank owned life insurance and certain loan receivables.

Net Interest Margin

Columbia's net interest margin (tax equivalent) for the fourth quarter of 2018 was 4.40%, a decrease of 1 basis point from the linked quarter and an increase of 20 basis points from the prior year period. Columbia's operating net interest margin (tax equivalent)(1) was 4.38% for both the fourth quarter of 2018 and the linked quarter and increased 13 basis points from the prior year period. Although the net interest margin for the current quarter as compared to the linked quarter was flat, the increase from the prior year period was due to income from earning assets acquired in the Pacific Continental acquisition as well as higher rates on interest-earning assets, which more than offset the modest increase in rates on interest-bearing liabilities.

Greg Sigrist, Columbia's Executive Vice President and Chief Financial Officer, commented, "Our net interest margin continued to hold up well given the strength of our deposit franchise. We also added to our leverage strategy in the quarter. Although this muted the benefit of loans repricing in the quarter, the leverage strategy is an important tool to help position the Bank for a falling rate environment."

The following table shows the impact to interest income resulting from income accretion on acquired loan portfolios as well as the net interest margin and operating net interest margin:



Three Months Ended


Twelve Months Ended



December 31,


September 30,


June 30,


March 31,


December 31,


December 31,


December 31,



2018


2018


2018


2018


2017


2018


2017



(dollars in thousands)

Incremental accretion income due to:















FDIC purchased credit impaired loans


$

395



$

585



$

326



$

329



$

265



$

1,635



$

4,107


Other acquired loans


2,218



2,643



2,690



3,370



2,482



10,921



8,689


Incremental accretion income


$

2,613



$

3,228



$

3,016



$

3,699



$

2,747



$

12,556



$

12,796

















Net interest margin (tax equivalent)


4.40

%


4.41

%


4.29

%


4.22

%


4.20

%


4.33

%


4.18

%

Operating net interest margin (tax equivalent) (1)


4.38

%


4.38

%


4.27

%


4.18

%


4.25

%


4.30

%


4.15

%

__________

(1) Operating net interest margin (tax equivalent) is a non-GAAP financial measure. See the section titled "Non-GAAP Financial Measures" in this earnings release for the reconciliation of operating net interest margin (tax equivalent) to net interest margin.

Asset Quality

At December 31, 2018, nonperforming assets to total assets were 0.46% compared to 0.52% at September 30, 2018. Total nonperforming assets decreased $6.9 million from the linked quarter due to a $5.5 million decrease in nonaccrual loans and a $1.4 million decrease in other real estate owned.

Andy McDonald, Columbia's Executive Vice President and Chief Credit Officer, commented, "We are pleased with the progress that we have made in reducing the level of our nonperforming assets. Our nonperforming assets to total assets ratio was 0.46% which is below our general target of 0.50%.

The following table sets forth information regarding nonaccrual loans and total nonperforming assets:



December 31, 2018


September 30, 2018


December 31, 2017



(in thousands)

Nonaccrual loans:







Commercial business


$

35,513



$

45,753



$

45,460


Real estate:







One-to-four family residential


1,158



501



785


Commercial and multifamily residential


14,904



11,012



13,941


Total real estate


16,062



11,513



14,726


Real estate construction:







One-to-four family residential


318



318



1,854


Total real estate construction


318



318



1,854


Consumer


2,949



2,748



4,149


Total nonaccrual loans


54,842



60,332



66,189


Other real estate owned and other personal property owned


6,049



7,415



13,298


Total nonperforming assets


$

60,891



$

67,747



$

79,487


The following table provides an analysis of the Company's allowance for loan and lease losses:



Three Months Ended


Twelve Months Ended



December 31,
2018


September 30,
2018


December 31,
2017


December 31,
2018


December 31,
2017



(in thousands)

Beginning balance, loans excluding PCI loans


$

79,770



$

75,368



$

64,272



$

68,739



$

59,528


Beginning balance, PCI loans


4,017



4,782



7,344



6,907



10,515


Beginning balance


83,787



80,150



71,616



75,646



70,043


Charge-offs:











Commercial business


(2,861)



(606)



(1,524)



(11,719)



(7,613)


One-to-four family residential real estate










(460)


Commercial and multifamily residential real estate


(557)





(287)



(780)



(287)


One-to-four family residential real estate construction










(14)


Consumer


(421)



(277)



(318)



(1,194)



(1,474)


Purchased credit impaired


(1,076)



(1,208)



(1,440)



(4,862)



(6,812)


Total charge-offs


(4,915)



(2,091)



(3,569)



(18,555)



(16,660)


Recoveries:











Commercial business


535



547



839



3,427



4,836


One-to-four family residential real estate


19



21



188



408



568


Commercial and multifamily residential real estate


19



213



412



1,031



675


One-to-four family residential real estate construction


1,000



583



71



1,616



178


Commercial and multifamily residential real estate construction






1





1


Consumer


384



266



311



1,180



1,187


Purchased credit impaired


751



945



2,450



3,847



6,187


Total recoveries


2,708



2,575



4,272



11,509



13,632


Net recoveries (charge-offs)


(2,207)



484



703



(7,046)



(3,028)


Provision for loan and lease losses, excluding PCI loans


1,870



3,655



4,774



17,050



11,614


Recapture for loan and lease losses, PCI loans


(81)



(502)



(1,447)



(2,281)



(2,983)


Provision for loan and lease losses


1,789



3,153



3,327



14,769



8,631


Ending balance, loans excluding PCI loans


79,758



79,770



68,739



79,758



68,739


Ending balance, PCI loans


3,611



4,017



6,907



3,611



6,907


Ending balance


$

83,369



$

83,787



$

75,646



$

83,369



$

75,646


The allowance for loan losses to period end loans was 0.99% at December 31, 2018 compared to 0.98% at September 30, 2018. For the fourth quarter of 2018, Columbia recorded a net provision for loan and lease losses of $1.8 million compared to a net provision of $3.2 million for the linked quarter and a net provision of $3.3 million for the comparable quarter last year. The net provision for loan and lease losses recorded during the current quarter consisted of $1.9 million of provision expense for loans, excluding PCI loans and a recapture of $81 thousand for PCI loans.

Organizational Update

For the 8th consecutive year, Columbia was listed on the Forbes annual list of America's Best Banks, which measures asset quality, capital adequacy, net interest margin and profitability among the nation's largest publicly traded banks and thrifts. We were also recognized as an employer of choice in Oregon, joining the Oregonian's list of Top Workplaces 2018 and were named one of Washington's Best Workplaces for the 12th consecutive year by the Puget Sound Business Journal.

In addition to the recognition we received for dedication to providing a great place to work, we received recognition for our work in the community. We were pleased to receive the 2018 National Association of Secretaries of State Medallion by the Washington Secretary of State for outstanding work to improve lives in Washington communities. We were also delighted to receive the 2018 Corporate Citizenship Award for midsize companies in Washington State by the Puget Sound Business Journal and to be selected as one of Oregon's Most Admired companies by the Portland Business Journal. For the first time, Columbia was named the Top SBA Lender in Oregon by the Small Business Administration.

Mr. Robbins commented, "We were honored to be recognized for our commitment to our employees, our clients and our communities in the Northwest throughout the year. We were particularly pleased to receive recognition for our partnership and community support from the Springfield, Oregon and Beaverton Oregon Chambers of Commerce, two markets in the footprint of former Pacific Continental Bank."

Cash Dividend Announcement

Columbia will pay a regular cash dividend of $0.28 per common share and a special cash dividend of $0.14 per common share on February 20, 2019 to shareholders of record as of the close of business on February 6, 2019.

Conference Call Information

Columbia's management will discuss the fourth quarter and full-year 2018 financial results on a conference call scheduled for Thursday, January 24, 2019 at 1:00 p.m. Pacific Time (4:00 p.m. ET). Interested parties may join the live-streamed event by using the site:
https://engage.vevent.com/rt/columbiabankingsysteminc~012419

The conference call can also be accessed on Thursday, January 24, 2019 at 1:00 p.m. Pacific Time (4:00 p.m. ET) by calling 888-286-8956; Conference ID: 3096265.

A replay of the call can be accessed beginning Friday, January 25, 2019 using the site: https://engage.vevent.com/rt/columbiabankingsysteminc~012419

About Columbia

Headquartered in Tacoma, Washington, Columbia Banking System, Inc. is the holding company of Columbia Bank, a Washington state-chartered full-service commercial bank with locations throughout Washington, Oregon and Idaho. For the 12th consecutive year, the bank was named in 2018 as one of Puget Sound Business Journal's "Washington's Best Workplaces." For the 8th consecutive year, Columbia was included in the 2019 Forbes America's Best Bank list.

More information about Columbia can be found on its website at www.columbiabank.com.

Note Regarding Forward-Looking Statements

This news release includes forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward looking statements include, but are not limited to, descriptions of Columbia's management's expectations regarding future events and developments such as future operating results, growth in loans and deposits, continued success of Columbia's style of banking and the strength of the local economy. The words "will," "believe," "expect," "intend," "should," and "anticipate" or the negative of these words or words of similar construction are intended in part to help identify forward looking statements. Future events are difficult to predict, and the expectations described above are necessarily subject to risks and uncertainties, many of which are outside our control, that may cause actual results to differ materially and adversely. In addition to discussions about risks and uncertainties set forth from time to time in Columbia's filings with the Securities and Exchange Commission, available at the SEC's website at www.sec.gov and the Company's website at www.columbiabank.com, include the "Risk Factors," "Business" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of our annual reports on Form 10-K and quarterly reports on Form 10-Q, (as applicable), factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among others, the following:  (1) local, national and international economic conditions may be less favorable than expected or have a more direct and pronounced effect on Columbia than expected and adversely affect Columbia's ability to continue its internal growth at historical rates and maintain the quality of its earning assets; (2) changes in interest rates could significantly reduce net interest income and negatively affect funding sources; (3) projected business increases following strategic expansion or opening or acquiring new branches may be lower than expected; (4) costs or difficulties related to the integration of acquisitions may be greater than expected; (5) competitive pressure among financial institutions may increase significantly; (6) reliance on and cost of technology may increase; and (7) legislation or regulatory requirements or changes may adversely affect the businesses in which Columbia is engaged. We believe the expectations reflected in our forward-looking statements are reasonable, based on information available to us on the date hereof. However, given the described uncertainties and risks, we cannot guarantee our future performance or results of operations and you should not place undue reliance on these forward-looking statements which speak only as of the date hereof. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by the federal securities laws. The factors noted above and the risks and uncertainties described in our SEC filings should be considered when reading any forward-looking statements in this release.

Contacts:

Hadley S. Robbins,


President and


Chief Executive Officer




Gregory A. Sigrist,


Executive Vice President and


Chief Financial Officer




Investor Relations


InvestorRelations@columbiabank.com


253-305-1921

 

CONSOLIDATED BALANCE SHEETS









Columbia Banking System, Inc.










Unaudited







December 31,


September 30,


December 31,








2018


2018


2017








(in thousands)

ASSETS



Cash and due from banks







$

260,180



$

220,706



$

244,615


Interest-earning deposits with banks







17,407



21,456



97,918


Total cash and cash equivalents







277,587



242,162



342,533


Debt securities available for sale at fair value






3,167,448



2,921,114



2,737,751


Equity securities at fair value









4,901



5,080


Federal Home Loan Bank ("FHLB") stock at cost






25,960



16,640



10,440


Loans held for sale







3,849



5,275



5,766


Loans, net of unearned income







8,391,511



8,514,317



8,358,657


Less: allowance for loan and lease losses






83,369



83,787



75,646


Loans, net







8,308,142



8,430,530



8,283,011


Interest receivable







45,323



48,476



40,881


Premises and equipment, net







168,788



169,681



169,490


Other real estate owned







6,019



7,331



13,298


Goodwill







765,842



765,842



765,842


Other intangible assets, net







45,937



48,827



58,173


Other assets







280,250



295,817



284,621


Total assets







$

13,095,145



$

12,956,596



$

12,716,886


LIABILITIES AND SHAREHOLDERS' EQUITY







Deposits:












Noninterest-bearing







$

5,227,216



$

5,250,222



$

5,081,901


Interest-bearing







5,230,910



5,353,735



5,450,184


Total deposits







10,458,126



10,603,957



10,532,085


FHLB advances







399,523



166,536



11,579


Securities sold under agreements to repurchase






61,094



62,197



79,059


Subordinated debentures







35,462



35,508



35,647


Junior subordinated debentures











8,248


Other liabilities







107,291



107,003



100,346


Total liabilities







11,061,496



10,975,201



10,766,964


Commitments and contingent liabilities













December 31,


September 30,


December 31,








2018


2018


2017








(in thousands)







Preferred stock (no par value)












Authorized shares

2,000



2,000



2,000








Common stock (no par value)












Authorized shares

115,000



115,000



115,000








Issued and outstanding

73,249



73,260



73,020



1,642,246



1,640,140



1,634,705


Retained earnings







426,708



411,264



337,442


Accumulated other comprehensive loss







(35,305)



(70,009)



(22,225)


Total shareholders' equity







2,033,649



1,981,395



1,949,922


Total liabilities and shareholders' equity






$

13,095,145



$

12,956,596



$

12,716,886


 

CONSOLIDATED STATEMENTS OF INCOME







Columbia Banking System, Inc.

Three Months Ended


Twelve Months Ended

Unaudited


December 31,


September 30,


December 31,


December 31,


December 31,



2018


2018


2017


2018


2017

Interest Income


(in thousands except per share)

Loans


$

110,010



$

109,748



$

95,889



$

428,197



$

324,229


Taxable securities


16,684



14,654



9,487



55,969



38,659


Tax-exempt securities


3,005



3,069



2,920



12,201



11,045


Deposits in banks


102



104



545



702



813


Total interest income


129,801



127,575



108,841



497,069



374,746


Interest Expense











Deposits


3,831



3,193



2,022



12,105



4,800


FHLB advances


1,399



966



99



3,750



1,078


Subordinated debentures


467



468



304



1,871



304


Other borrowings


216



152



192



504



575


Total interest expense


5,913



4,779



2,617



18,230



6,757


Net Interest Income


123,888



122,796



106,224



478,839



367,989


Provision for loan and lease losses


1,789



3,153



3,327



14,769



8,631


Net interest income after provision for loan and lease losses


122,099



119,643



102,897



464,070



359,358


Noninterest Income











Deposit account and treasury management fees


9,383



9,266



8,013



36,072



30,381


Card revenue


3,576



3,714



6,967



19,719



25,627


Financial services and trust revenue


3,211



2,975



2,958



12,135



11,478


Loan revenue


2,344



3,282



2,663



11,866



12,399


Merchant processing revenue










4,283


Bank owned life insurance


1,467



1,402



1,377



6,007



5,380


Investment securities losses, net


(16)



(62)



(11)



(89)



(11)


Change in FDIC loss-sharing asset










(447)


Gain on sale of merchant card services portfolio










14,000


Other


437



442



1,614



2,546



6,552


Total noninterest income


20,402



21,019



23,581



88,256



109,642


Noninterest Expense











Compensation and employee benefits


51,261



49,419



50,473



200,199



169,674


Occupancy


8,858



8,321



9,554



36,576



32,407


Merchant processing expense










2,196


Advertising and promotion


1,061



1,472



1,543



5,584



4,466


Data processing


5,278



4,466



5,134



20,235



18,205


Legal and professional fees


5,941



4,695



5,955



18,044



15,151


Taxes, licenses and fees


1,514



1,562



1,279



6,061



4,773


Regulatory premiums


932



904



884



3,710



3,183


Net cost (benefit) of operation of other real estate owned


(26)



485



46



1,218



468


Amortization of intangibles


2,890



3,070



2,547



12,236



6,333


Other


9,310



8,447



8,212



36,627



34,161


Total noninterest expense


87,019



82,841



85,627



340,490



291,017


Income before income taxes


55,482



57,821



40,851



211,836



177,983


Provision for income taxes


10,734



11,406



25,123



38,954



65,155


Net Income


$

44,748



$

46,415



$

15,728



$

172,882



$

112,828


Earnings per common share











Basic


$

0.61



$

0.63



$

0.23



$

2.36



$

1.86


Diluted


$

0.61



$

0.63



$

0.23



$

2.36



$

1.86


Dividends declared per common share - regular


$

0.26



$

0.26



$

0.22



$

1.00



$

0.88


Dividends declared per common share - special


$

0.14



$



$



$

0.14



$


   Dividends declared per common share - total


$

0.40



$

0.26



$

0.22



$

1.14



$

0.88


Weighted average number of common shares outstanding


72,434



72,427



67,120



72,385



59,882


Weighted average number of diluted common shares outstanding


72,438



72,432



67,125



72,390



59,888


 

FINANCIAL STATISTICS








Columbia Banking System, Inc.

Three Months Ended


Twelve Months Ended

Unaudited


December 31,


September 30,


December 31,


December 31,


December 31,



2018


2018


2017


2018


2017

Earnings


(dollars in thousands except per share amounts)

Net interest income


$

123,888



$

122,796



$

106,224



$

478,839



$

367,989


Provision for loan and lease losses


$

1,789



$

3,153



$

3,327



$

14,769



$

8,631


Noninterest income


$

20,402



$

21,019



$

23,581



$

88,256



$

109,642


Noninterest expense


$

87,019



$

82,841



$

85,627



$

340,490



$

291,017


Acquisition-related expense (included in noninterest expense)


$

493



$

1,081



$

13,638



$

8,661



$

17,196


Net income


$

44,748



$

46,415



$

15,728



$

172,882



$

112,828


Per Common Share











Earnings (basic)


$

0.61



$

0.63



$

0.23



$

2.36



$

1.86


Earnings (diluted)


$

0.61



$

0.63



$

0.23



$

2.36



$

1.86


Book value


$

27.76



$

27.05



$

26.70



$

27.76



$

26.70


Tangible book value per common share (1)


$

16.68



$

15.93



$

15.42



$

16.68



$

15.42


Averages











Total assets


$

12,957,754



$

12,805,131



$

11,751,049



$

12,725,086



$

10,134,306


Interest-earning assets


$

11,458,470



$

11,326,629



$

10,453,097



$

11,241,321



$

9,098,276


Loans


$

8,441,354



$

8,456,632



$

7,749,420



$

8,409,373



$

6,682,259


Securities, including equity securities and FHLB stock


$

2,998,638



$

2,849,495



$

2,539,321



$

2,790,700



$

2,350,844


Deposits


$

10,560,280



$

10,478,800



$

9,804,456



$

10,410,404



$

8,482,350


Interest-bearing deposits


$

5,298,590



$

5,376,300



$

5,033,980



$

5,367,602



$

4,371,121


Interest-bearing liabilities


$

5,599,646



$

5,620,997



$

5,127,100



$

5,614,827



$

4,512,727


Noninterest-bearing deposits


$

5,261,690



$

5,102,500



$

4,770,476



$

5,042,802



$

4,111,229


Shareholders' equity


$

1,988,981



$

1,983,317



$

1,754,745



$

1,969,179



$

1,410,056


Financial Ratios











Return on average assets


1.38

%


1.45

%


0.54

%


1.36

%


1.11

%

Return on average common equity


9.00

%


9.36

%


3.59

%


8.78

%


8.00

%

Return on average tangible common equity (1)


16.00

%


16.74

%


6.37

%


15.85

%


12.38

%

Average equity to average assets


15.35

%


15.49

%


14.93

%


15.47

%


13.91

%

Shareholders equity to total assets


15.53

%


15.29

%


15.33

%


15.53

%


15.33

%

Tangible common shareholders' equity to tangible assets (1)


9.95

%


9.61

%


9.47

%


9.95

%


9.47

%

Net interest margin (tax equivalent)


4.40

%


4.41

%


4.20

%


4.33

%


4.18

%

Efficiency ratio (tax equivalent) (2)


59.31

%


56.67

%


63.93

%


59.06

%


59.07

%

Operating efficiency ratio (tax equivalent) (1)


58.10

%


54.83

%


52.24

%


56.63

%


56.06

%

Noninterest expense ratio


2.69

%


2.59

%


2.91

%


2.68

%


2.87

%

Core noninterest expense ratio (1)


2.67

%


2.55

%


2.45

%


2.61

%


2.67

%



December 31,


September 30,


December 31,





Period end


2018


2018


2017





Total assets


$

13,095,145



$

12,956,596



$

12,716,886






Loans, net of unearned income


$

8,391,511



$

8,514,317



$

8,358,657






Allowance for loan and lease losses


$

83,369



$

83,787



$

75,646






Securities, including equity securities and FHLB stock


$

3,193,408



$

2,942,655



$

2,753,271






Deposits


$

10,458,126



$

10,603,957



$

10,532,085






Core deposits


$

9,973,840



$

10,084,687



$

10,039,557






Shareholders' equity


$

2,033,649



$

1,981,395



$

1,949,922






Nonperforming assets











Nonaccrual loans


$

54,842



$

60,332



$

66,189






Other real estate owned ("OREO") and other personal property owned ("OPPO")


6,049



7,415



13,298






Total nonperforming assets


$

60,891



$

67,747



$

79,487






Nonperforming loans to period-end loans


0.65

%


0.71

%


0.79

%





Nonperforming assets to period-end assets


0.46

%


0.52

%


0.63

%





Allowance for loan and lease losses to period-end loans


0.99

%


0.98

%


0.91

%





Net loan charge-offs (recoveries) (3)


$

2,207



$

(484)



$

(703)

















(1) This is a non-GAAP measure. See section titled "Non-GAAP Financial Measures" on the last three pages of this earnings release for a reconciliation to the most comparable GAAP measure.


(2) Noninterest expense divided by the sum of net interest income on a tax equivalent basis and noninterest income on a tax equivalent basis.


(3) For the three months ended.

 

QUARTERLY FINANCIAL STATISTICS








Columbia Banking System, Inc.

Three Months Ended

Unaudited


December 31,


September 30,


June 30,


March 31,


December 31,



2018


2018


2018


2018


2017

Earnings


(dollars in thousands except per share)

Net interest income


$

123,888



$

122,796



$

116,674



$

115,481



$

106,224


Provision for loan and lease losses


$

1,789



$

3,153



$

3,975



$

5,852



$

3,327


Noninterest income


$

20,402



$

21,019



$

23,692



$

23,143



$

23,581


Noninterest expense


$

87,019



$

82,841



$

84,643



$

85,987



$

85,627


Acquisition-related expense (included in noninterest expense)


$

493



$

1,081



$

2,822



$

4,265



$

13,638


Net income


$

44,748



$

46,415



$

41,749



$

39,970



$

15,728


Per Common Share











Earnings (basic)


$

0.61



$

0.63



$

0.57



$

0.55



$

0.23


Earnings (diluted)


$

0.61



$

0.63



$

0.57



$

0.55



$

0.23


Book value


$

27.76



$

27.05



$

26.83



$

26.60



$

26.70


Averages











Total assets


$

12,957,754



$

12,805,131



$

12,529,540



$

12,603,144



$

11,751,049


Interest-earning assets


$

11,458,470



$

11,326,629



$

11,052,807



$

11,122,753



$

10,453,097


Loans


$

8,441,354



$

8,456,632



$

8,389,230



$

8,348,740



$

7,749,420


Securities, including equity securities and FHLB stock


$

2,998,638



$

2,849,495



$

2,628,292



$

2,682,250



$

2,539,321


Deposits


$

10,560,280



$

10,478,800



$

10,264,822



$

10,334,480



$

9,804,456


Interest-bearing deposits


$

5,298,590



$

5,376,300



$

5,390,869



$

5,405,730



$

5,033,980


Interest-bearing liabilities


$

5,599,646



$

5,620,997



$

5,611,055



$

5,627,853



$

5,127,100


Noninterest-bearing deposits


$

5,261,690



$

5,102,500



$

4,873,953



$

4,928,750



$

4,770,476


Shareholders' equity


$

1,988,981



$

1,983,317



$

1,954,552



$

1,949,275



$

1,754,745


Financial Ratios











Return on average assets


1.38

%


1.45

%


1.33

%


1.27

%


0.54

%

Return on average common equity


9.00

%


9.36

%


8.54

%


8.20

%


3.59

%

Average equity to average assets


15.35

%


15.49

%


15.60

%


15.47

%


14.93

%

Shareholders' equity to total assets


15.53

%


15.29

%


15.56

%


15.55

%


15.33

%

Net interest margin (tax equivalent)


4.40

%


4.41

%


4.29

%


4.22

%


4.20

%

Period end











Total assets


$

13,095,145



$

12,956,596



$

12,628,586



$

12,530,636



$

12,716,886


Loans, net of unearned income


$

8,391,511



$

8,514,317



$

8,454,107



$

8,339,631



$

8,358,657


Allowance for loan and lease losses


$

83,369



$

83,787



$

80,150



$

79,827



$

75,646


Securities, including equity securities and FHLB stock


$

3,193,408



$

2,942,655



$

2,665,131



$

2,640,685



$

2,753,271


Deposits


$

10,458,126



$

10,603,957



$

10,384,004



$

10,395,523



$

10,532,085


Core deposits


$

9,973,840



$

10,084,687



$

9,888,696



$

9,897,185



$

10,039,557


Shareholders' equity


$

2,033,649



$

1,981,395



$

1,964,881



$

1,947,923



$

1,949,922


Goodwill


$

765,842



$

765,842



$

765,842



$

765,842



$

765,842


Other intangible assets, net


$

45,937



$

48,827



$

51,897



$

54,985



$

58,173


Nonperforming assets











Nonaccrual loans


$

54,842



$

60,332



$

69,504



$

78,464



$

66,189


OREO and OPPO


6,049



7,415



7,080



11,507



13,298


Total nonperforming assets


...