Umpqua Reports Second Quarter 2021 Results

Rhea-AI Summary

Umpqua Holdings Corporation reported strong financial results for Q2 2021, showcasing a net income of $53 million and earnings per diluted share of $0.53. Net interest income increased by $8.3 million, attributed to higher loan balances. However, non-interest income fell by $17.7 million, primarily due to a decrease in mortgage banking revenue. The total risk-based capital ratio stands at 15.4%, reflecting solid capital management. The company also announced a quarterly dividend of $0.21 per share. Umpqua's focus on growth is evident in their non-PPP loan performance and optimistic market outlook.

Positive

• Net interest income increased by $8.3 million due to higher average loan balances.
• Net charge-offs decreased to 0.25% of average loans, indicating improved credit quality.
• Total risk-based capital ratio estimated at 15.4%, above regulatory minimums.
• Quarterly cash dividend of $0.21 per common share maintained.

Negative

• Non-interest income decreased by $17.7 million, primarily from lower mortgage banking revenue.
• Non-interest expense increased due to exit disposal costs and store consolidations.

PORTLAND, Ore., July 21, 2021 /PRNewswire/ --

$0.53		$116		17.33%		15.4%
Net earnings per diluted common share		Net income ($ in millions)		Return on average tangible common equity ("ROATCE")1		Total risk-based capital ratio (estimated)

CEO Commentary

"Umpqua's strong results this past quarter demonstrate both the company's commitment to generating long-term value for shareholders and our optimism for growth in the markets we serve. I'm very pleased to see the success of our balanced growth efforts and unique Human Digital value proposition reflected in our record growth in non-PPP (Paycheck Protection Program) loans and increase in core bank revenue.  Our brand momentum within our markets continues to build and we look forward to robust customer and talent acquisition in the quarters to come."
–            Cort O'Haver, President and CEO of Umpqua Holdings Corporation

SECOND QUARTER HIGHLIGHTS
Net Interest Income and NIM	•   Net interest income increased by $8.3 million on a quarter to quarter basis primarily due to higher average loan balances and lower interest expense in the current period.
	•   Net interest margin was 3.20%, up two basis points from the prior period due to higher average loan balances and lower interest expense.
Non-Interest Income and Expense	•   Non-interest income decreased by $17.7 million due to lower net mortgage banking revenue of $20.6 million.
	•   Non-interest expense increased by $1.8 million due to exit disposal costs of $4.7 million as a result of store consolidations and back-office lease exits.
Credit Quality	•   Net charge-offs decreased by eight basis points to 0.25% of average loans and leases (annualized).
	•   A recapture of the provision for credit losses of $23.0 million was recorded in the period as economic conditions improve.
	•   Non-performing assets to total assets decreased two basis points to 0.17% from 0.19%.
Capital	•   Estimated total risk-based capital ratio of 15.4% and estimated Tier 1 Risk Based Capital ratio of 12.4%.
	•   Paid a quarterly cash dividend of $0.21 per common share on May 28, 2021 to shareholders of record as of May 18, 2021.
Notable items	•   $4.5 million gain on the sale of Umpqua Investments completed during the quarter.
	•   $4.7 million in exit disposal costs related to store consolidations and back-office lease exits.

 

2Q21 KEY FINANCIAL DATA
PERFORMANCE METRICS	2Q21			1Q21			2Q20
Return on average assets	1.54%			1.49%			0.73%
Return on average tangible common equity	17.33%			16.43%			8.53%
Net interest margin	3.20%			3.18%			3.09%
Efficiency ratio - consolidated	58.96%			56.74%			55.40%
Loan to deposit ratio	84.67%			85.61%			91.25%
INCOME STATEMENT ($ in 000s, excl. per share data)	2Q21			1Q21			2Q20
Net interest income	$229,763			$221,431			$212,503
(Recapture) provision for credit losses	($22,996)			$—			$87,085
Non-interest income	$91,075			$108,800			$115,480
Non-interest expense	$189,400			$187,592			$181,910
Earnings per common share - diluted	$0.53			$0.49			$0.24
Dividends paid per share	$0.21			$0.21			$0.21
BALANCE SHEET	2Q21			1Q21			2Q20
Total assets	$30.3	B		$30.0	B		$29.6	B
Loans and leases	$22.1	B		$22.2	B		$22.7	B
Total deposits	$26.2	B		$25.9	B		$24.8	B
Tangible book value per share1	$12.49			$12.10			$11.44
Book value per common shares	$12.54			$12.16			$11.53

Segment Disclosures
Segment disclosures on pages 19, 20 and 21 of this press release provide additional detail on the Company's two operating segments: Core Banking and Mortgage Banking.

The Core Banking segment includes all lines of business, except Mortgage Banking, including wholesale, retail, wealth management, as well as the operations, technology, and administrative functions of the Bank and Holding Company.  The Mortgage Banking segment includes the revenue earned from the production and sale of residential real estate loans, the servicing income from our serviced loan portfolio, the quarterly changes to the mortgage servicing rights (MSR) asset, and the specific expenses that are related to mortgage banking activities including variable commission expenses.  Revenue and related expenses related to residential real estate loans held for investment are included in the Core Banking segment as portfolio loans are an anchor product for our consumer channels and are originated through a variety of channels throughout the Company.

Balance Sheet
Total consolidated assets were $30.3 billion as of June 30, 2021, compared to $30.0 billion as of March 31, 2021 and $29.6 billion as of June 30, 2020.  Including secured off-balance sheet lines of credit, total available liquidity was $15.6 billion as of June 30, 2021, representing 51% of total assets and 60% of total deposits.

Gross loans and leases were $22.1 billion as of June 30, 2021, a decrease of $17.1 million relative to March 31, 2021.  The net decrease in gross loans and leases is primarily due to an increase of non-PPP loans of $650.5 million or 3.2% offset by the expected decrease in PPP loan balances of $667.6 million due to processed forgiveness and payoffs. Commercial real estate balances increased $281.8 million and residential real estate balances increased $207.9 million during the quarter.  The decrease in commercial loan balances of $502.7 million includes the aforementioned decrease of PPP loan balances of $667.6 million.  Please refer to the additional loan tables in the Q2 2021 Earnings Presentation for select underwriting characteristics of the loan portfolio.

Total deposits were $26.2 billion as of June 30, 2021, an increase of $266.7 million or 1% from $25.9 billion as of March 31, 2021. This increase was primarily attributable to growth in interest bearing demand deposits of $221.6 million, growth in non-interest bearing demand deposits of $218.4 million and growth in savings balances of $112.3 million, partially offset by a decline in time deposits of $290.5 million.

Net Interest Income
Net interest income was $229.8 million for the second quarter of 2021, up $8.3 million from the prior quarter.  The increase was primarily driven by an increase of $3.7 million in interest income, as a result of higher average loan balances, and a decrease of $4.6 million in interest expense due to the decline in time deposits in the quarter compared to the prior period.

The Company's net interest margin was 3.20% for the second quarter of 2021, up two basis points from 3.18% for the first quarter of 2021 primarily driven by the decrease in interest expense due to the decline in deposit costs.

Credit Quality
The allowance for credit losses was $294.4 million, or 1.33% of loans and leases, as of June 30, 2021, which was down from $331.0 million, or 1.49% of loans and leases, as of March 31, 2021.  There was a recapture of provision for credit losses of $23.0 million as a result of improvement in economic forecasts used in the credit models.

Net charge-offs as a percentage of average loans and leases decreased by eight basis points to 0.25% of average loans and leases (annualized) as of June 30, 2021.  The decrease in net charge-offs for the quarter was primarily due to continued stable credit performance of the loan portfolio. As of June 30, 2021, non-performing assets were 0.17% of total assets, compared to 0.19% as of March 31, 2021 and 0.25% as of June 30, 2020.

Current Expected Credit Loss (CECL)
On January 1, 2020, we adopted Accounting Standards Update No. 2016-13, Financial Instruments —Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments ("CECL").  In applying CECL, we use credit models that factor in economic forecasts to project life of loan performance.  At the beginning of the COVID-19 pandemic, economic forecasts projected significant, negative COVID-19 related impacts to the economy; therefore we recorded significant provisions for credit losses in the first and second quarters of 2020. As those future economic forecasts stabilized as well as incorporating loan mix changes, we recorded a recapture of $23.0 million of the allowance for credit losses in the current period.

Non-interest Income
Non-interest income was $91.1 million for the second quarter of 2021, down $17.7 million from the prior quarter driven primarily by a decrease in net mortgage banking revenue of $20.6 million.

Revenue from the origination and sale of residential mortgages was $41.4 million for the second quarter of 2021, a decrease of $21.1 million from the prior quarter. This decrease reflects a sequential quarter decrease of $382.5 million or 23.4% in for-sale mortgage origination volume and a decrease of 52 basis points in the mortgage banking gain on sale margin to 3.30% for the second quarter of 2021. Of the current quarter's mortgage production, 56% related to purchase activity, compared to 37% for the prior quarter and 34% for the same period of the prior year.

Non-interest Expense
Non-interest expense was $189.4 million for the second quarter of 2021, up $1.8 million from the prior quarter level. This increase was primarily due to an increase in exit and disposal costs of $3.5 million from the prior period due to store consolidations and back-office lease exits, an increase in consulting and professional fees of $1.1 million, offset by an increase in deferred origination costs of $1.7 million and a decrease in FDIC assessment costs of $1.0 million. 

Capital
As of June 30, 2021, the Company's tangible book value per common share² increased to $12.49, compared to $12.10 in the prior quarter and $11.44 in the same period of the prior year. 

The Company's estimated total risk-based capital ratio was 15.4% and its estimated Tier 1 common to risk weightedassets ratio was 12.4% as of June 30, 2021. The Company remains above current "well-capitalized" regulatory minimums.  The regulatory capital ratios as of June 30, 2021 are estimates, pending completion and filing of the Company's regulatory reports.

Non-GAAP Financial Measures
In addition to results presented in accordance with generally accepted accounting principles in the United States of America (GAAP), this press release contains certain non-GAAP financial measures.  The Company believes that these non-GAAP financial measures provide investors with information useful in understanding the Company's financial performance; however, readers of this document are urged to review these non-GAAP financial measures in conjunction with the GAAP results as reported.

Management believes tangible common equity and the tangible common equity ratio are useful measures of capital adequacy because they provide a meaningful base for period-to-period and company-to-company comparisons, which management believes will assist investors in assessing the capital of the Company and the ability to absorb potential losses. Tangible common equity is calculated as total shareholders' equity less goodwill and other intangible assets, net (excluding MSRs). Tangible assets are total assets less goodwill and other intangible assets, net (excluding MSRs).  The tangible common equity ratio is calculated as tangible common shareholders' equity divided by tangible assets.

The following table provides reconciliations of ending shareholders' equity (GAAP) to ending tangible common equity (non-GAAP), and ending assets (GAAP) to ending tangible assets (non-GAAP).

(In thousands, except per share data)		Jun 30, 2021				Mar 31, 2021				Dec 31, 2020				Sep 30, 2020				Jun 30, 2020
Total shareholders' equity		$	2,766,316			$	2,681,869			$	2,704,577			$	2,610,244			$	2,538,339
Subtract:
Goodwill		—				2,715				2,715				2,715				2,715
Other intangible assets, net		11,100				12,230				13,360				14,606				15,853
Tangible common shareholders' equity		$	2,755,216			$	2,666,924			$	2,688,502			$	2,592,923			$	2,519,771
Total assets		$	30,284,965			$	30,036,680			$	29,235,175			$	29,437,441			$	29,645,248
Subtract:
Goodwill		—				2,715				2,715				2,715				2,715
Other intangible assets, net		11,100				12,230				13,360				14,606				15,853
Tangible assets		$	30,273,865			$	30,021,735			$	29,219,100			$	29,420,120			$	29,626,680
Common shares outstanding at period end		220,626				220,491				220,226				220,222				220,219
Total shareholders' equity to total assets ratio		9.13		%		8.93		%		9.25		%		8.87		%		8.56		%
Tangible common equity ratio		9.10		%		8.88		%		9.20		%		8.81		%		8.51		%
Book value per common share		$	12.54			$	12.16			$	12.28			$	11.85			$	11.53
Tangible book value per common share		$	12.49			$	12.10			$	12.21			$	11.77			$	11.44

About Umpqua Holdings Corporation
Umpqua Holdings Corporation (NASDAQ: UMPQ) is the parent company of Umpqua Bank, an Oregon-based community bank recognized for its entrepreneurial approach, innovative customer experience, and distinctive banking solutions. Umpqua Bank has locations across Oregon, Washington, California, Idaho and Nevada.  Umpqua Holdings Corporation is headquartered in Portland, Oregon. For more information, visit umpquabank.com.

Earnings Conference Call Information
The Company will host its second quarter 2021 earnings conference call on July 22, 2021, at 10:00 a.m. PT (1:00 p.m. ET).  During the call, the Company will provide an update on recent activities and discuss its second quarter 2021 financial results. There will be a live question-and-answer session following the presentation. To join the call, please dial (866) 440-7407 ten minutes prior to the start time and enter conference ID: 3759164.  A re-broadcast will be available approximately two hours after the call by dialing (855) 859-2056 and entering conference ID 3759164. The earnings conference call will also be available as an audio cast, which can be accessed on the Company's investor relations page at https://www.umpquabank.com/investor-relations/.

Forward-Looking Statements
This press release includes forward-looking statements within the meaning of the "Safe-Harbor" provisions of the Private Securities Litigation Reform Act of 1995, which management believes are a benefit to shareholders. These statements are necessarily subject to risk and uncertainty and actual results could differ materially due to various risk factors, including those set forth from time to time in our filings with the SEC. You should not place undue reliance on forward-looking statements and we undertake no obligation to update any such statements.  Forward-looking statements can be identified by words such as "anticipates," "intends," "plans," "seeks," "believes," "estimates," "expects," "target," "projects," "outlook," "forecast," "will," "may," "could," "should," "can" and similar references to future periods. In this press release we make forward-looking statements about strategic and growth initiatives.  Risks that could cause results to differ from forward-looking statements we make are set forth in our filings with the SEC and include, without limitation: current and future economic and market conditions, including the effects of declines in housing and commercial real estate prices, high unemployment rates, and any slowdown in economic growth particularly in the western United States; the effect of the COVID-19 pandemic, including on our credit quality, deferral programs, and business operations, as well as its impact on general economic and financial market conditions; economic forecast variables that are either materially worse or better than end of quarter projections and deterioration in the economy that exceeds current consensus estimates; our ability to effectively manage problem credits; our ability to successfully implement efficiency and operational excellence initiatives; our ability to successfully develop and market new products and technology; and changes in laws or regulations. We also caution that the amount and timing of any future common stock dividends or repurchases will depend on the earnings, cash requirements and financial condition of the Company, market conditions, capital requirements, applicable law and regulations (including federal securities laws and federal banking regulations), and other factors deemed relevant by the Company's Board of Directors, and may be subject to regulatory approval or conditions.

Umpqua Holdings Corporation
Consolidated Statements of Operations
(Unaudited)
	Quarter Ended																				% Change
(In thousands, except per share data)	Jun 30, 2021				Mar 31, 2021				Dec 31, 2020				Sep 30, 2020				Jun 30, 2020				Seq. Quarter			Year over Year
Interest income:
Loans and leases	$	223,470			$	221,141			$	240,815			$	229,457			$	235,174			1	%		(5)	%
Interest and dividends on investments:
Taxable	14,619				13,112				11,951				10,168				9,015				11	%		62	%
Exempt from federal income tax	1,487				1,534				1,523				1,490				1,520				(3)	%		(2)	%
Dividends	405				598				659				710				568				(32)	%		(29)	%
Temporary investments and interest bearing deposits	774				624				531				474				403				24	%		92	%
Total interest income	240,755				237,009				255,479				242,299				246,680				2	%		(2)	%
Interest expense:
Deposits	7,016				10,678				14,567				19,121				26,222				(34)	%		(73)	%
Securities sold under agreement to repurchase and federal funds purchased	68				76				93				84				194				(11)	%		(65)	%
Borrowings	866				1,772				2,765				3,271				3,839				(51)	%		(77)	%
Junior subordinated debentures	3,042				3,052				3,147				3,249				3,922				0	%		(22)	%
Total interest expense	10,992				15,578				20,572				25,725				34,177				(29)	%		(68)	%
Net interest income	229,763				221,431				234,907				216,574				212,503				4	%		8	%
(Recapture) provision for credit losses	(22,996)				—				29				(338)				87,085				nm			(126)	%
Non-interest income:
Service charges on deposits	10,310				9,647				10,202				10,405				8,757				7	%		18	%
Card-based fees	10,274				7,374				7,754				7,118				5,901				39	%		74	%
Brokerage revenue	1,135				3,915				4,093				3,686				3,805				(71)	%		(70)	%
Residential mortgage banking revenue, net	44,443				65,033				79,028				90,377				83,877				(32)	%		(47)	%
Gain on sale of debt securities, net	—				4				—				—				323				(100)	%		(100)	%
Gain (loss) on equity securities, net	4				(706)				(173)				(112)				240				(101)	%		(98)	%
Gain on loan and lease sales, net	5,318				1,373				3,374				1,092				1,074				287	%		395	%
BOLI income	2,092				2,071				2,067				2,087				2,116				1	%		(1)	%
Other income	17,499				20,089				17,615				17,271				9,387				(13)	%		86	%
Total non-interest income	91,075				108,800				123,960				131,924				115,480				(16)	%		(21)	%
Non-interest expense:
Salaries and employee benefits	121,573				124,134				132,460				120,337				116,676				(2)	%		4	%
Occupancy and equipment, net	34,657				34,635				41,758				36,720				36,171				0	%		(4)	%
Intangible amortization	1,130				1,130				1,246				1,247				1,246				0	%		(9)	%
FDIC assessments	1,607				2,599				3,014				2,989				3,971				(38)	%		(60)	%
Other expenses	30,433				25,094				32,834				28,914				23,846				21	%		28	%
Total non-interest expense	189,400				187,592				211,312				190,207				181,910				1	%		4	%
Income before provision for income taxes	154,434				142,639				147,526				158,629				58,988				8	%		162	%
Provision (benefit) for income taxes	38,291				34,902				(3,204)				33,758				6,062				10	%		532	%
Net income	$	116,143			$	107,737			$	150,730			$	124,871			$	52,926			8	%		119	%
Weighted average basic shares outstanding	220,593				220,367				220,225				220,221				220,210				0	%		0	%
Weighted average diluted shares outstanding	221,022				220,891				220,663				220,418				220,320				0	%		0	%
Earnings per common share – basic	$	0.53			$	0.49			$	0.68			$	0.57			$	0.24			8	%		121	%
Earnings per common share – diluted	$	0.53			$	0.49			$	0.68			$	0.57			$	0.24			8	%		121	%
nm = not meaningful

 

Umpqua Holdings Corporation
Consolidated Statements of Operations
(Unaudited)
		Six Months Ended								% Change
(In thousands, except per share data)		Jun 30, 2021				Jun 30, 2020				Year  over      Year
Interest income:
Loans and leases		$	444,611			$	481,167			(8)	%
Interest and dividends on investments:
Taxable		27,731				25,620				8	%
Exempt from federal income tax		3,021				3,082				(2)	%
Dividends		1,003				1,246				(20)	%
Temporary investments and interest bearing deposits		1,398				3,734				(63)	%
Total interest income		477,764				514,849				(7)	%
Interest expense:
Deposits		17,694				66,512				(73)	%
Securities sold under agreement to repurchase and federal funds purchased		144				589				(76)	%
Borrowings		2,638				7,885				(67)	%
Junior subordinated debentures		6,094				8,825				(31)	%
Total interest expense		26,570				83,811				(68)	%
Net interest income		451,194				431,038				5	%
(Recapture) provision for credit losses		(22,996)				205,170				(111)	%
Non-interest income:
Service charges on deposits		19,957				20,230				(1)	%
Card-based fees		17,648				13,318
Brokerage revenue		5,050				7,820				(35)	%
Residential mortgage banking revenue, net		109,476				101,417				8	%
Gain on sale of debt securities, net		4				190				(98)	%
(Loss) gain on equity securities, net		(702)				1,054				(167)	%
Gain on loan and lease sales, net		6,691				2,241				199	%
BOLI income		4,163				4,245				(2)	%
Other income		37,588				5,610				570	%
Total non-interest income		199,875				156,125				28	%
Non-interest expense:
Salaries and employee benefits		245,707				226,450				9	%
Occupancy and equipment, net		69,292				73,172				(5)	%
Intangible amortization		2,260				2,493				(9)	%
FDIC assessments		4,206				6,513				(35)	%
Goodwill impairment		—				1,784,936				nm
Other expenses		55,527				51,004				9	%
Total non-interest expense		376,992				2,144,568				(82)	%
Income (loss) before provision for income taxes		297,073				(1,762,575)				(117)	%
Provision for income taxes		73,193				36,446				101	%
Net income (loss)		$	223,880			$	(1,799,021)			(112)	%
Weighted average basic shares outstanding		220,481				220,213				0	%
Weighted average diluted shares outstanding		220,928				220,213				0	%
Earnings (loss) per common share – basic		$	1.02			$	(8.17)			(112)	%
Earnings (loss) per common share – diluted		$	1.01			$	(8.17)			(112)	%
nm = not meaningful

 

Umpqua Holdings Corporation Consolidated Balance Sheets
(Unaudited)
																					% Change
(In thousands, except per share data)	Jun 30, 2021				Mar 31, 2021				Dec 31, 2020				Sep 30, 2020				Jun 30, 2020				Seq. Quarter			Year over Year
Assets:
Cash and due from banks	$	397,526			$	379,361			$	370,219			$	370,595			$	410,769			5	%		(3)	%
Interest bearing cash and temporary investments	2,688,285				2,861,820				2,202,962				1,849,132				1,853,505				(6)	%		45	%
Investment securities:
Equity and other, at fair value	82,099				82,771				83,077				82,769				81,958				(1)	%		0	%
Available for sale, at fair value	3,473,950				3,167,825				2,932,558				2,898,700				2,865,690				10	%		21	%
Held to maturity, at amortized cost	2,876				2,954				3,034				3,088				3,143				(3)	%		(8)	%
Loans held for sale	429,052				376,481				766,225				683,960				605,399				14	%		(29)	%
Loans and leases	22,143,739				22,160,860				21,779,367				22,426,473				22,671,455				0	%		(2)	%
Allowance for credit losses on loans and leases	(279,887)				(311,283)				(328,401)				(345,049)				(356,745)				(10)	%		(22)	%
Net loans and leases	21,863,852				21,849,577				21,450,966				22,081,424				22,314,710				0	%		(2)	%
Restricted equity securities	15,247				22,057				41,666				50,062				54,062				(31)	%		(72)	%
Premises and equipment, net	172,546				176,571				178,050				185,104				192,041				(2)	%		(10)	%
Operating lease right-of-use assets	95,030				100,643				104,937				107,321				111,487				(6)	%		(15)	%
Goodwill	—				2,715				2,715				2,715				2,715				(100)	%		(100)	%
Other intangible assets, net	11,100				12,230				13,360				14,606				15,853				(9)	%		(30)	%
Residential mortgage servicing rights, at fair value	102,699				100,413				92,907				93,248				96,356				2	%		7	%
Bank owned life insurance	324,998				322,867				323,470				326,120				324,873				1	%		0	%
Deferred tax asset, net	—				10,905				—				—				—				(100)	%		nm
Other assets	625,705				567,490				669,029				688,597				712,687				10	%		(12)	%
Total assets	$	30,284,965			$	30,036,680			$	29,235,175			$	29,437,441			$	29,645,248			1	%		2	%
Liabilities:
Deposits	$	26,153,553			$	25,886,833			$	24,622,201			$	24,669,783			$	24,844,378			1	%		5	%
Securities sold under agreements to repurchase	480,302				420,402				375,384				388,028				398,414				14	%		21	%
Borrowings	111,405				281,444				771,482				996,520				1,096,559				(60)	%		(90)	%
Junior subordinated debentures, at fair value	287,723				281,580				255,217				247,045				232,936				2	%		24	%
Junior subordinated debentures, at amortized cost	88,155				88,212				88,268				88,325				88,382				0	%		0	%
Operating lease liabilities	106,195				109,014				113,593				115,790				119,885				(3)	%		(11)	%
Deferred tax liability, net	2,497				—				5,441				13,239				21,439				nm			(88)	%
Other liabilities	288,819				287,326				299,012				308,467				304,916				1	%		(5)	%
Total liabilities	27,518,649				27,354,811				26,530,598				26,827,197				27,106,909				1	%		2	%
Shareholders' equity:
Common stock	3,517,641				3,515,248				3,514,599				3,512,153				3,510,145				0	%		0	%
Accumulated deficit	(801,954)				(871,511)				(932,767)				(1,036,931)				(1,115,414)				(8)	%		(28)	%
Accumulated other comprehensive income	50,629				38,132				122,745				135,022				143,608				33	%		(65)	%
Total shareholders' equity	2,766,316				2,681,869				2,704,577				2,610,244				2,538,339				3	%		9	%
Total liabilities and shareholders' equity	$	30,284,965			$	30,036,680			$	29,235,175			$	29,437,441			$	29,645,248			1	%		2	%
Common shares outstanding at period end	220,626				220,491				220,226				220,222				220,219				0	%		0	%
Book value per common share	$	12.54			$	12.16			$	12.28			$	11.85			$	11.53			3	%		9	%
Tangible book value per common share	$	12.49			$	12.10			$	12.21			$	11.77			$	11.44			3	%		9	%
Tangible equity - common	$	2,755,216			$	2,666,924			$	2,688,502			$	2,592,923			$	2,519,771			3	%		9	%
Tangible common equity to tangible assets	9.10		%		8.88		%		9.20		%		8.81		%		8.51		%		0.22			0.59
nm = not meaningful

 

Umpqua Holdings Corporation
Loan and Lease Portfolio
(Unaudited)
	Jun 30, 2021				Mar 31, 2021				Dec 31, 2020				Sep 30, 2020				Jun 30, 2020				% Change
(Dollars in thousands)	Amount				Amount				Amount				Amount				Amount				Seq. Quarter			Year over Year
Loans and leases:
Commercial real estate:
Non-owner occupied term, net	$	3,580,386			$	3,455,773			$	3,505,802			$	3,533,776			$	3,589,484			4	%		0	%
Owner occupied term, net	2,398,326				2,358,169				2,333,945				2,411,098				2,459,954				2	%		(3)	%
Multifamily, net	3,553,704				3,421,320				3,349,196				3,389,034				3,466,829				4	%		3	%
Construction & development, net	857,866				876,297				828,478				757,462				662,703				(2)	%		29	%
Residential development, net	193,904				190,841				192,761				163,400				164,180				2	%		18	%
Commercial:
Term, net (1)	3,748,269				4,350,763				4,024,467				4,246,229				4,265,092				(14)	%		(12)	%
Lines of credit & other, net	908,518				825,162				862,760				894,782				940,443				10	%		(3)	%
Leases & equipment finance, net	1,437,372				1,420,977				1,456,630				1,496,650				1,522,369				1	%		(6)	%
Residential:
Mortgage, net	4,145,432				3,958,644				3,871,906				4,042,416				4,056,588				5	%		2	%
Home equity loans & lines, net	1,118,278				1,097,168				1,136,064				1,172,697				1,189,428				2	%		(6)	%
Consumer & other, net	201,684				205,746				217,358				318,929				354,385				(2)	%		(43)	%
Total loans and leases, net of deferred fees and costs	$	22,143,739			$	22,160,860			$	21,779,367			$	22,426,473			$	22,671,455			0	%		(2)	%
(1)    The Bank participates in the Payroll Protection Program to originate SBA loans designated to help businesses maintain their workforce and cover other working capital needs during the COVID-19 pandemic. The Commercial Term loans in the table above include 14,000 PPP loans, totaling $1.4 billion, net of deferred fees and costs as of June 30, 2021.
Loan and leases mix:
Commercial real estate:
Non-owner occupied term, net	16		%		15		%		16		%		16		%		16		%
Owner occupied term, net	11		%		11		%		11		%		11		%		11		%
Multifamily, net	16		%		15		%		15		%		15		%		15		%
Construction & development, net	4		%		4		%		4		%		3		%		3		%
Residential development, net	1		%		1		%		1		%		1		%		1		%
Commercial:
Term, net	17		%		20		%		18		%		19		%		19		%
Lines of credit & other, net	4		%		4		%		4		%		4		%		4		%
Leases & equipment finance, net	6		%		6		%		7		%		7		%		7		%
Residential:
Mortgage, net	19		%		18		%		18		%		18		%		18		%
Home equity loans & lines, net	5		%		5		%		5		%		5		%		5		%
Consumer & other, net	1		%		1		%		1		%		1		%		1		%
Total	100		%		100		%		100		%		100		%		100		%

 

Umpqua Holdings Corporation
Deposits by Type/Core Deposits
(Unaudited)
	Jun 30, 2021				Mar 31, 2021				Dec 31, 2020				Sep 30, 2020				Jun 30, 2020				% Change
(Dollars in thousands)	Amount				Amount				Amount				Amount				Amount				Seq. Quarter			Year over Year
Deposits:
Demand, non-interest bearing	$	10,718,921			$	10,500,482			$	9,632,773			$	9,475,244			$	9,172,210			2	%		17	%
Demand, interest bearing	3,466,251				3,244,624				3,051,487				2,931,990				2,813,722				7	%		23	%
Money market	7,559,621				7,554,798				7,173,920				7,160,838				7,262,777				0	%		4	%
Savings	2,221,524				2,109,211				1,912,752				1,848,639				1,730,051				5	%		28	%
Time	2,187,236				2,477,718				2,851,269				3,253,072				3,865,618				(12)	%		(43)	%
Total	$	26,153,553			$	25,886,833			$	24,622,201			$	24,669,783			$	24,844,378			1	%		5	%
Total core deposits (1)	$	25,122,851			$	24,740,621			$	23,298,561			$	23,134,283			$	22,934,059			2	%		10	%
Deposit mix:
Demand, non-interest bearing	41		%		41		%		39		%		38		%		37		%
Demand, interest bearing	13		%		12		%		12		%		12		%		11		%
Money market	29		%		29		%		29		%		29		%		29		%
Savings	9		%		8		%		8		%		8		%		7		%
Time	8		%		10		%		12		%		13		%		16		%
Total	100		%		100		%		100		%		100		%		100		%
Number of open accounts:
Demand, non-interest bearing	424,626				422,792				420,050				423,658				423,456
Demand, interest bearing	71,411				72,156				72,811				73,812				74,813
Money market	58,289				58,409				58,609				59,083				59,445
Savings	161,902				161,432				160,192				162,234				161,710
Time	39,560				43,637				48,292				52,572				57,501
Total	755,788				758,426				759,954				771,359				776,925
Average balance per account:
Demand, non-interest bearing	$	25.2			$	24.8			$	22.9			$	22.4			$	21.7
Demand, interest bearing	48.5				45.0				41.9				39.7				37.6
Money market	129.7				129.3				122.4				121.2				122.2
Savings	13.7				13.1				11.9				11.4				10.7
Time	55.3				56.8				59.0				61.9				67.2
Total	$	34.6			$	34.1			$	32.4			$	32.0			$	32.0

(1)	Core deposits are defined as total deposits less time deposits greater than $250,000 and all brokered deposits.

 

Umpqua Holdings Corporation
Credit Quality – Non-performing Assets
(Unaudited)
		Quarter Ended																				% Change
(Dollars in thousands)		Jun 30, 2021				Mar 31, 2021				Dec 31, 2020				Sep 30, 2020				Jun 30, 2020				Seq. Quarter			Year over Year
Non-performing assets:
Loans and leases on non-accrual status		$	20,673			$	29,216			$	31,076			$	26,425			$	32,412			(29)	%		(36)	%
Loans and leases past due 90+ days and accruing (1)		29,144				25,612				36,361				50,269				39,818				14	%		(27)	%
Total non-performing loans and leases		49,817				54,828				67,437				76,694				72,230				(9)	%		(31)	%
Other real estate owned		181				1,405				1,810				2,369				2,578				(87)	%		(93)	%
Total non-performing assets		$	49,998			$	56,233			$	69,247			$	79,063			$	74,808			(11)	%		(33)	%
Performing restructured loans and leases		$	13,072			$	9,921			$	14,991			$	15,819			$	15,032			32	%		(13)	%
Loans and leases past due 31-89 days		$	30,646			$	51,120			$	72,047			$	66,155			$	40,583			(40)	%		(24)	%
Loans and leases past due 31-89 days to total loans and leases		0.14		%		0.23		%		0.33		%		0.29		%		0.18		%
Non-performing loans and leases to total loans and leases (1)		0.22		%		0.25		%		0.31		%		0.34		%		0.32		%
Non-performing assets to total assets(1)		0.17		%		0.19		%		0.24		%		0.27		%		0.25		%

(1)

Excludes certain mortgage loans guaranteed by Ginnie Mae, which Umpqua has the unilateral right to repurchase but has not done so, totaling $20.0 million and $2.6 million at September 30, 2020 and June 30, 2020, respectively. There were no non-performing mortgage loans guaranteed by Ginnie Mae, which Umpqua has the unilateral right to repurchase but has not done so at June 30, 2021, March 31, 2021 and December 31, 2020.

 

Umpqua Holdings Corporation
Credit Quality – Allowance for Credit Losses
(Unaudited)
		Quarter Ended																				% Change
(Dollars in thousands)		Jun 30, 2021				Mar 31, 2021				Dec 31, 2020				Sep 30, 2020				Jun 30, 2020				Seq. Quarter			Year over Year
Allowance for credit losses on loans and leases (ACLLL)
Balance, beginning of period		$	311,283			$	328,401			$	345,049			$	356,745			$	291,420			(5)	%		7	%
Impact of adoption of CECL		—				—				—				—				—				nm			nm
Adjusted balance, beginning of period		311,283				328,401				345,049				356,745				291,420				(5)	%		7	%
(Recapture) provision for credit losses on loans and leases		(17,775)				526				3,104				1,785				81,484				(3,479)	%		(122)	%
Charge-offs		(17,079)				(20,915)				(23,942)				(16,646)				(19,453)				(18)	%		(12)	%
Recoveries		3,458				3,271				4,190				3,165				3,294				6	%		5	%
Net charge-offs		(13,621)				(17,644)				(19,752)				(13,481)				(16,159)				(23)	%		(16)	%
Balance, end of period		$	279,887			$	311,283			$	328,401			$	345,049			$	356,745			(10)	%		(22)	%
Reserve for unfunded commitments
Balance, beginning of period		$	19,760			$	20,286			$	24,306			$	26,368			$	20,927			(3)	%		(6)	%
(Recapture) provision for credit losses on unfunded commitments		(5,221)				(526)				(4,020)				(2,062)				5,441				893	%		(196)	%
Balance, end of period		14,539				19,760				20,286				24,306				26,368				(26)	%		(45)	%
Total Allowance for credit losses (ACL)		$	294,426			$	331,043			$	348,687			$	369,355			$	383,113			(11)	%		(23)	%
Net charge-offs to average loans and leases (annualized)		0.25		%		0.33		%		0.35		%		0.24		%		0.29		%
Recoveries to gross charge-offs		20.25		%		15.64		%		17.50		%		19.01		%		16.93		%
ACLLL to loans and leases		1.26		%		1.40		%		1.51		%		1.54		%		1.57		%
ACL to loans and leases		1.33		%		1.49		%		1.60		%		1.65		%		1.69		%
nm = not meaningful

 

Umpqua Holdings Corporation
Credit Quality – Allowance for Credit Losses
(Unaudited)
		Six Months Ended								% Change
(Dollars in thousands)		Jun 30, 2021				Jun 30, 2020				Year over Year
Allowance for credit losses on loans and leases (ACLLL)
Balance, beginning of period		$	328,401			$	157,629			108	%
Impact of adoption of CECL		—				49,999				nm
Adjusted balance, beginning of period		328,401				207,628				58	%
(Recapture) provision for credit losses on loans and leases		(17,249)				186,986				(109)	%
Charge-offs		(37,994)				(43,908)				(13)	%
Recoveries		6,729				6,039				11	%
Net charge-offs		(31,265)				(37,869)				(17)	%
Balance, end of period		$	279,887			$	356,745			(22)	%
Reserve for unfunded commitments
Balance, beginning of period		$	20,286			$	5,106			297	%
Impact of adoption of CECL		—				3,238				nm
Adjusted balance, beginning of period		20,286				8,344				143	%
(Recapture) provision for credit losses on unfunded commitments		(5,747)				18,024				(132)	%
Balance, end of period		14,539				26,368				(45)	%
Total Allowance for credit losses (ACL)		$	294,426			$	383,113			(23)	%
Net charge-offs to average loans and leases (annualized)		0.29		%		0.35		%
Recoveries to gross charge-offs		17.71		%		13.75		%
nm = not meaningful

 

Umpqua Holdings Corporation
Selected Ratios
(Unaudited)
		Quarter Ended															% Change
		Jun 30, 2021			Mar 31, 2021			Dec 31, 2020			Sep 30, 2020			Jun 30, 2020			Seq. Quarter			Year over Year
Average Rates:
Yield on loans held for sale		3.18	%		2.75	%		3.19	%		3.13	%		3.77	%		0.43			(0.59)
Yield on loans and leases		3.99	%		4.02	%		4.24	%		3.96	%		4.11	%		(0.03)			(0.12)
Yield on taxable investments		1.87	%		1.86	%		1.77	%		1.56	%		1.38	%		0.01			0.49
Yield on tax-exempt investments (1)		3.02	%		3.03	%		3.08	%		3.11	%		3.17	%		(0.01)			(0.15)
Yield on interest bearing cash and temporary investments		0.11	%		0.10	%		0.10	%		0.10	%		0.10	%		0.01			0.01
Total yield on earning assets (1)		3.35	%		3.41	%		3.64	%		3.45	%		3.59	%		(0.06)			(0.24)
Cost of interest bearing deposits		0.18	%		0.29	%		0.38	%		0.49	%		0.67	%		(0.11)			(0.49)
Cost of securities sold under agreements
to repurchase and fed funds purchased		0.06	%		0.08	%		0.09	%		0.09	%		0.21	%		(0.02)			(0.15)
Cost of borrowings		1.62	%		1.33	%		1.18	%		1.23	%		1.33	%		0.29			0.29
Cost of junior subordinated debentures		3.30	%		3.60	%		3.73	%		4.03	%		5.55	%		(0.30)			(2.25)
Total cost of interest bearing liabilities		0.27	%		0.38	%		0.49	%		0.59	%		0.78	%		(0.11)			(0.51)
Net interest spread (1)		3.08	%		3.03	%		3.15	%		2.85	%		2.81	%		0.05			0.27
Net interest margin (1)		3.20	%		3.18	%		3.35	%		3.08	%		3.09	%		0.02			0.11
Performance Ratios:
Return on average assets		1.54	%		1.49	%		2.04	%		1.68	%		0.73	%		0.05			0.81
Return on average tangible assets		1.55	%		1.49	%		2.04	%		1.68	%		0.73	%		0.06			0.82
Return on average common equity		17.25	%		16.33	%		22.92	%		19.48	%		8.46	%		0.92			8.79
Return on average tangible common equity		17.33	%		16.43	%		23.07	%		19.62	%		8.53	%		0.90			8.80
Efficiency ratio – Consolidated		58.96	%		56.74	%		58.82	%		54.52	%		55.40	%		2.22			3.56
Efficiency ratio – Bank		58.31	%		55.51	%		57.77	%		53.41	%		54.17	%		2.80			4.14

(1)	Tax exempt interest has been adjusted to a taxable equivalent basis using a 21% tax rate.

 

Umpqua Holdings Corporation
Selected Ratios
(Unaudited)
		Six Months Ended						% Change
		Jun 30, 2021			Jun 30, 2020			Year over Year
Average Rates:
Yield on loans held for sale		2.93	%		3.94	%		(1.01)
Yield on loans and leases		4.01	%		4.33	%		(0.32)
Yield on taxable investments		1.87	%		1.94	%		(0.07)
Yield on tax-exempt investments (1)		3.02	%		3.15	%		(0.13)
Yield on interest bearing cash and temporary investments		0.11	%		0.56	%		(0.45)
Total yield on earning assets (1)		3.38	%		3.88	%		(0.50)
Cost of interest bearing deposits		0.23	%		0.85	%		(0.62)
Cost of securities sold under agreements
to repurchase and fed funds purchased		0.07	%		0.33	%		(0.26)
Cost of borrowings		1.41	%		1.53	%		(0.12)
Cost of junior subordinated debentures		3.44	%		5.49	%		(2.05)
Total cost of interest bearing liabilities		0.33	%		0.96	%		(0.63)
Net interest spread (1)		3.05	%		2.92	%		0.13
Net interest margin (1)		3.19	%		3.25	%		(0.06)
Performance Ratios:
Return on average assets		1.52	%		(12.49)	%		14.01
Return on average tangible assets		1.52	%		(12.89)	%		14.41
Return on average common equity		16.80	%		(106.99)	%		123.79
Return on average tangible common equity		16.89	%		(145.65)	%		162.54
Efficiency ratio – Consolidated		57.84	%		364.82	%		(306.98)
Efficiency ratio – Bank		56.88	%		363.13	%		(306.25)

(1)	Tax exempt interest has been adjusted to a taxable equivalent basis using a 21% tax rate.

 

Umpqua Holdings Corporation Average Balances
(Unaudited)
	Quarter Ended																				% Change
(Dollars in thousands)	Jun 30, 2021				Mar 31, 2021				Dec 31, 2020				Sep 30, 2020				Jun 30, 2020				Seq. Quarter			Year over Year
Temporary investments and interest bearing cash	$	2,835,474			$	2,483,451			$	2,066,572			$	1,827,818			$	1,563,753			14	%		81	%
Investment securities, taxable	3,210,771				2,945,896				2,850,550				2,797,547				2,777,154				9	%		16	%
Investment securities, tax-exempt	247,282				252,741				245,997				237,165				235,934				(2)	%		5	%
Loans held for sale	468,960				703,557				696,688				669,646				577,773				(33)	%		(19)	%
Loans and leases	22,040,794				21,692,639				22,138,283				22,560,076				22,428,142				2	%		(2)	%
Total interest earning assets	28,803,281				28,078,284				27,998,090				28,092,252				27,582,756				3	%		4	%
Goodwill and other intangible assets, net	12,615				15,598				16,775				18,021				19,253				(19)	%		(34)	%
Total assets	30,156,017				29,392,490				29,396,311				29,533,871				29,066,775				3	%		4	%
Non-interest bearing demand deposits	10,582,197				9,897,749				9,587,081				9,335,350				8,484,684				7	%		25	%
Interest bearing deposits	15,474,743				15,166,198				15,165,049				15,451,816				15,803,595				2	%		(2)	%
Total deposits	26,056,940				25,063,947				24,752,130				24,787,166				24,288,279				4	%		7	%
Interest bearing liabilities	16,500,106				16,444,694				16,822,808				17,205,775				17,625,888				0	%		(6)	%
Shareholders' equity - common	2,700,010				2,674,871				2,615,676				2,549,703				2,514,754				1	%		7	%
Tangible common equity (1)	2,687,395				2,659,273				2,598,901				2,531,682				2,495,501				1	%		8	%

 

Umpqua Holdings Corporation Average Balances
(Unaudited)
		Six Months Ended								% Change
(Dollars in thousands)		Jun 30, 2021				Jun 30, 2020				Year over Year
Temporary investments and interest bearing cash		$	2,660,435			$	1,325,627			101	%
Investment securities, taxable		3,079,065				2,768,853				11	%
Investment securities, tax-exempt		249,996				238,505				5	%
Loans held for sale		585,611				492,577				19	%
Loans and leases		21,867,678				21,815,966				0	%
Total interest earning assets		28,442,785				26,641,528				7	%
Goodwill and other intangible assets, net		14,098				897,551				(98)	%
Total assets		29,776,362				28,956,388				3	%
Non-interest bearing demand deposits		10,241,863				7,687,002				33	%
Interest bearing deposits		15,321,323				15,749,751				(3)	%
Total deposits		25,563,186				23,436,753				9	%
Interest bearing liabilities		16,472,553				17,464,696				(6)	%
Shareholders' equity - common		2,687,510				3,381,417				(21)	%
Tangible common equity (1)		2,673,412				2,483,866				8	%

(1)	Average tangible common equity is a non-GAAP financial measure. Average tangible common equity is calculated as average common shareholders' equity less average goodwill and other intangible assets, net (excluding MSRs).

 

Umpqua Holdings Corporation Average Rates and Balances
(Unaudited)
	Quarter Ended
	June 30, 2021											March 31, 2021											June 30, 2020
(Dollars in thousands)	Average Balance				Interest Income or Expense				Average Yields or Rates			Average Balance				Interest Income or Expense				Average Yields or Rates			Average Balance				Interest Income or Expense				Average Yields or Rates
INTEREST-EARNING ASSETS:
Loans held for sale	$	468,960			$	3,725			3.18	%		$	703,557			$	4,845			2.75	%		$	577,773			$	5,443			3.77	%
Loans and leases (1)	22,040,794				219,745				3.99	%		21,692,639				216,296				4.02	%		22,428,142				229,731				4.11	%
Taxable securities	3,210,771				15,024				1.87	%		2,945,896				13,710				1.86	%		2,777,154				9,583				1.38	%
Non-taxable securities (2)	247,282				1,864				3.02	%		252,741				1,915				3.03	%		235,934				1,868				3.17	%
Temporary investments and interest-bearing cash	2,835,474				774				0.11	%		2,483,451				624				0.10	%		1,563,753				403				0.10	%
Total interest-earning assets	28,803,281				$	241,132			3.35	%		28,078,284				$	237,390			3.41	%		27,582,756				$	247,028			3.59	%
Other assets	1,352,736											1,314,206											1,484,019
Total assets	$	30,156,017										$	29,392,490										$	29,066,775
INTEREST-BEARING LIABILITIES:
Interest-bearing demand deposits	$	3,385,336			$	459			0.05	%		$	3,125,398			$	414			0.05	%		$	2,649,331			$	1,148			0.17	%
Money market deposits	7,614,474				1,533				0.08	%		7,360,512				1,491				0.08	%		7,275,041				4,037				0.22	%
Savings deposits	2,171,865				154				0.03	%		1,998,927				163				0.03	%		1,628,276				198				0.05	%
Time deposits	2,303,068				4,870				0.85	%		2,681,361				8,610				1.30	%		4,250,947				20,839				1.97	%
Total interest-bearing deposits	15,474,743				7,016				0.18	%		15,166,198				10,678				0.29	%		15,803,595				26,222				0.67	%
Repurchase agreements and federal funds purchased	440,881				68				0.06	%		395,946				76				0.08	%		375,098				194				0.21	%
Borrowings	214,670				866				1.62	%		539,077				1,772				1.33	%		1,163,065				3,839				1.33	%
Junior subordinated debentures	369,812				3,042				3.30	%		343,473				3,052				3.60	%		284,130				3,922				5.55	%
Total interest-bearing liabilities	16,500,106				$	10,992			0.27	%		16,444,694				$	15,578			0.38	%		17,625,888				$	34,177			0.78	%
Non-interest-bearing deposits	10,582,197											9,897,749											8,484,684
Other liabilities	373,704											375,176											441,449
Total liabilities	27,456,007											26,717,619											26,552,021
Common equity	2,700,010											2,674,871											2,514,754
Total liabilities and shareholders' equity	$	30,156,017										$	29,392,490										$	29,066,775
NET INTEREST INCOME					$	230,140										$	221,812										$	212,851
NET INTEREST SPREAD									3.08	%										3.03	%										2.81	%
NET INTEREST INCOME TO EARNING ASSETS OR NET INTEREST MARGIN (1), (2)									3.20	%										3.18	%										3.09	%

(1)	Non-accrual loans and leases are included in the average balance.
(2)	Tax-exempt income has been adjusted to a tax equivalent basis at a 21% tax rate. The amount of such adjustment was an addition to recorded income of approximately $377,000 for the three months ended June 30, 2021, as compared to $381,000 for March 31, 2021 and $348,000 for June 30, 2020.

 

Umpqua Holdings Corporation Average Rates and Balances
(Unaudited)
(dollars in thousands)	Six Months Ended
	June 30, 2021											June 30, 2020
	Average Balance				Interest Income or Expense				Average Yields or Rates			Average Balance				Interest Income or Expense				Average Yields or Rates
INTEREST-EARNING ASSETS:
Loans held for sale	$	585,611			$	8,570			2.93	%		$	492,577			$	9,707			3.94	%
Loans and leases (1)	21,867,678				436,041				4.01	%		21,815,966				471,460				4.33	%
Taxable securities	3,079,065				28,734				1.87	%		2,768,853				26,866				1.94	%
Non-taxable securities (2)	249,996				3,779				3.02	%		238,505				3,763				3.15	%
Temporary investments and interest-bearing cash	2,660,435				1,398				0.11	%		1,325,627				3,734				0.56	%
Total interest-earning assets	28,442,785				$	478,522			3.38	%		26,641,528				$	515,530			3.88	%
Other assets	1,333,577											2,314,860
Total assets	$	29,776,362										$	28,956,388
INTEREST-BEARING LIABILITIES:
Interest-bearing demand deposits	$	3,256,085			$	873			0.05	%		$	2,560,935			$	4,691			0.37	%
Money market deposits	7,488,195				3,024				0.08	%		7,191,796				15,796				0.44	%
Savings deposits	2,085,874				317				0.03	%		1,557,118				439				0.06	%
Time deposits	2,491,169				13,480				1.09	%		4,439,902				45,586				2.06	%
Total interest-bearing deposits	15,321,323				17,694				0.23	%		15,749,751				66,512				0.85	%
Repurchase agreements and federal funds purchased	418,538				144				0.07	%		356,550				589				0.33	%
Borrowings	375,977				2,638				1.41	%		1,035,553				7,885				1.53	%
Junior subordinated debentures	356,715				6,094				3.44	%		322,842				8,825				5.49	%
Total interest-bearing liabilities	16,472,553				$	26,570			0.33	%		17,464,696				$	83,811			0.96	%
Non-interest-bearing deposits	10,241,863											7,687,002
Other liabilities	374,436											423,273
Total liabilities	27,088,852											25,574,971
Common equity	2,687,510											3,381,417
Total liabilities and shareholders' equity	$	29,776,362										$	28,956,388
NET INTEREST INCOME					$	451,952										$	431,719
NET INTEREST SPREAD									3.05	%										2.92	%
NET INTEREST INCOME TO EARNING ASSETS OR NET INTEREST MARGIN (1), (2)									3.19	%										3.25	%

(1)	Non-accrual loans and leases are included in the average balance.
(2)	Tax-exempt income has been adjusted to a tax equivalent basis at a 21% tax rate. The amount of such adjustment was an addition to recorded income of approximately $758,000 for the six months ended June 30, 2021, as compared to $681,000 for the same period in 2020.

 

Umpqua Holdings Corporation Segments
(Unaudited)
Core Banking		Quarter Ended																				% Change
(in thousands)		Jun 30, 2021				Mar 31, 2021				Dec 31, 2020				Sep 30, 2020				Jun 30, 2020				Seq. Quarter			Year over Year
Net interest income		$	226,915			$	217,574			$	230,430			$	212,215			$	208,245			4	%		9	%
(Recapture) provision for credit losses		(22,996)				—				29				(338)				87,085				nm			(126)	%
Non-interest income
	Gain (loss) gain on sale of investment securities, net	4				(702)				(173)				(112)				563				(101)	%		(99)	%
	(Loss) gain on swap derivatives, net	(4,481)				11,750				3,955				1,765				(823)				(138)	%		444	%
	Non-interest income (excluding above items)	50,933				32,403				40,921				39,678				31,697				57	%		61	%
	Total non-interest income	46,456				43,451				44,703				41,331				31,437				7	%		48	%
Non-interest expense
	Exit and disposal costs	4,728				1,200				725				792				548				294	%		763	%
	Non-interest expense (excluding above items)	146,877				145,161				171,634				148,519				141,448				1	%		4	%
	Allocated expenses, net (1)	970				(790)				(3,565)				(2,976)				(1,963)				(223)	%		(149)	%
	Total non-interest expense	152,575				145,571				168,794				146,335				140,033				5	%		9	%
Income before income taxes		143,792				115,454				106,310				107,549				12,564				25	%		1,044	%
Provision (benefit) for income taxes		35,630				28,106				(13,508)				20,988				(5,544)				27	%		(743)	%
Net income		$	108,162			$	87,348			$	119,818			$	86,561			$	18,108			24	%		497	%
Effective Tax Rate		25		%		24		%		(13)		%		20		%		(44)		%
Efficiency Ratio		56		%		56		%		61		%		58		%		58		%
Total assets		$	29,720,182			$	29,529,769			$	28,438,813			$	28,652,477			$	28,942,285			1	%		3	%
Loans held for sale		$	—			$	—			$	78,146			$	—			$	—			0	%		0	%
Total loans and leases		$	22,143,739			$	22,160,860			$	21,779,367			$	22,426,473			$	22,671,455			0	%		(2)	%
Total deposits		$	25,820,776			$	25,425,339			$	24,200,012			$	24,102,498			$	24,421,486			2	%		6	%
Key Rates, end of period:
10 year CMT		1.45		%		1.74		%		0.93		%		0.69		%		0.66		%
FHLMC 30 year fixed		2.98		%		3.18		%		2.67		%		2.88		%		3.13		%
nm = not meaningful
(1) Represents the internal charge of centrally provided support services and other corporate overhead to the Mortgage Banking segment.

Umpqua Holdings Corporation Segments - Continued
(Unaudited)
Mortgage Banking		Quarter Ended																				% Change
(in thousands)		Jun 30, 2021				Mar 31, 2021				Dec 31, 2020				Sep 30, 2020				Jun 30, 2020				Seq. Quarter			Year over Year
Net interest income		$	2,848			$	3,857			$	4,477			$	4,359			$	4,258			(26)	%		(33)	%
Provision for credit losses		—				—				—				—				—				nm			nm
Non-interest income
	Residential mortgage banking revenue:
	Origination and sale	41,367				62,505				83,388				98,703				86,781				(34)	%		(52)	%
	Servicing	9,120				9,087				9,497				8,796				8,533				0	%		7	%
	Change in fair value of MSR asset:
	Changes due to collection/realization of expected cash flows over time	(4,366)				(4,545)				(4,431)				(4,878)				(5,042)				(4)	%		(13)	%
	Changes due to valuation inputs or assumptions	(1,678)				(2,014)				(9,426)				(12,244)				(6,395)				(17)	%		(74)	%
	Non-interest income (excluding above items)	176				316				229				216				166				(44)	%		6	%
	Total non-interest income	44,619				65,349				79,257				90,593				84,043				(32)	%		(47)	%
Non-interest expense
	Non-interest expense	37,795				41,231				38,953				40,896				39,914				(8)	%		(5)	%
	Allocated expenses, net (1)	(970)				790				3,565				2,976				1,963				(223)	%		(149)	%
	Total non-interest expense	36,825				42,021				42,518				43,872				41,877				(12)	%		(12)	%
Income before income taxes		10,642				27,185				41,216				51,080				46,424				(61)	%		(77)	%
Provision for income taxes		2,661				6,796				10,304				12,770				11,606				(61)	%		(77)	%
Net income		$	7,981			$	20,389			$	30,912			$	38,310			$	34,818			(61)	%		(77)	%
Effective Tax Rate		25		%		25		%		25		%		25		%		25		%
Efficiency Ratio		78		%		61		%		51		%		46		%		47		%
Total assets		$	564,783			$	506,911			$	796,362			$	784,964			$	702,963			11	%		(20)	%
Loans held for sale		$	429,052			$	376,481			$	688,079			$	683,960			$	605,399			14	%		(29)	%
Total deposits		$	332,777			$	461,494			$	422,189			$	567,285			$	422,892			(28)	%		(21)	%
LHFS Production Statistics:
Closed loan volume for-sale		1,253,023				1,635,532				1,769,432				1,922,789				1,826,095				(23)	%		(31)	%
Gain on sale margin		3.30		%		3.82		%		4.71		%		5.13		%		4.75		%
Direct LHFS expense		$	25,459			$	31,151			$	33,210			$	35,678			$	34,057			(18)	%		(25)	%
Direct LHFS expenses as % of volume		2.03		%		1.90		%		1.88		%		1.86		%		1.87		%
MSR Statistics:
Residential mortgage loans serviced for others		12,897,032				13,030,467				13,026,720				12,964,361				12,746,125				(1)	%		1	%
MSR, net		102,699				100,413				92,907				93,248				96,356				2	%		7	%
MSR as % of serviced portfolio		0.80		%		0.77		%		0.71		%		0.72		%		0.76		%
Key Rates, end of period:
10 year CMT		1.45		%		1.74		%		0.93		%		0.69		%		0.66		%
FHLMC 30 year fixed		2.98		%		3.18		%		2.67		%		2.88		%		3.13		%
nm = not meaningful

(1)	Represents the internal charge of centrally provided support services and other corporate overhead to the Mortgage Banking segment, partially offset by allocations from the Mortgage Banking segment to Core Banking for new portfolio loan originations and portfolio servicing costs.

 

---

Umpqua Holdings Corporation Segments
(Unaudited)
(in thousands)		Core Banking											Mortgage Banking
		Six Months Ended								% Change			Six Months Ended								% Change
		Jun 30, 2021				Jun 30, 2020				Year over Year			Jun 30, 2021				Jun 30, 2020				Year over Year
Net interest income		$	444,489			$	424,351			4.75	%		$	6,705			$	6,687			0.27	%
Provision for credit losses		(22,996)				205,170				(111.21)	%		—				—				nm
Non-interest income
	Residential mortgage banking revenue:
	Origination and sale	—				—				nm			103,872				126,128				(17.65)	%
	Servicing	—				—				nm			18,207				17,413				4.56	%
	Change in fair value of MSR asset:
	Changes due to collection/realization of expected cash flows over time	—				—				nm			(8,911)				(10,371)				(14.08)	%
	Changes due to valuation inputs or assumptions	—				—				nm			(3,692)				(31,753)				(88.37)	%
	Gain (loss) on sale of investment securities, net	(698)				1,244				(156.11)	%		—				—				nm
	Gain (loss) on swap derivatives, net	7,269				(15,129)				(148.05)	%		—				—				nm
	Non-interest income (excluding above items)	83,336				68,285				22.04	%		492				308				59.74	%
	Total non-interest income	89,907				54,400				65.27	%		109,968				101,725				8.10	%
Non-interest expense
	Goodwill Impairment	—				1,784,936				(100.00)	%		—				—				nm
	Exit and disposal costs	5,928				1,072				452.99	%		—				—				nm
	Non-interest expense (excluding above items)	292,038				289,344				0.93	%		79,026				69,216				14.17	%
	Allocated expenses, net (1)	180				(5,016)				(103.59)	%		(180)				5,016				(103.59)	%
	Total non-interest expense	298,146				2,070,336				(85.60)	%		78,846				74,232				6.22	%
Income (loss) before income taxes		259,246				(1,796,755)				(114.43)	%		37,827				34,180				10.67	%
Provision (benefit) for income taxes		63,736				27,901				128.44	%		9,457				8,545				10.67	%
Net income (loss)		$	195,510			$	(1,824,656)			(110.71)	%		$	28,370			$	25,635			10.67	%
Effective Tax Rate		25		%		(2)		%					25		%		25		%
Efficiency Ratio		56		%		432		%					68		%		68		%
LHFS Production Statistics:
Closed loan volume for-sale													2,888,555				2,974,279
Gain on sale margin													3.60		%		4.24		%
Direct LHFS expense													$	56,610			$	58,102
Direct LHFS expenses as % of volume													1.96		%		1.95		%
nm = not meaningful

(1)	Represents the internal charge of centrally provided support services and other corporate overhead to the Mortgage Banking segment, partially offset by allocations from the Mortgage Banking segment to Core Banking for new portfolio loan originations and portfolio servicing costs.

¹ "Non-GAAP" financial measure.  A reconciliation to the comparable GAAP measurement is provided on page 4.
² "Non-GAAP" financial measure. A reconciliation to the comparable GAAP measurement is provided on page 4.

 

 

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SOURCE Umpqua Holdings Corporation