Umpqua Reports Third Quarter 2020 Results

Rhea-AI Summary

Umpqua Holdings Corporation (NASDAQ: UMPQ) reported net income of $124.9 million for Q3 2020, a significant increase from $52.9 million in Q2 2020 and $84.5 million in Q3 2019. Earnings per diluted share were $0.57. The growth was driven by a robust home lending division, producing $2.2 billion in loans. The company also saw a decrease in credit loss provisions by $87.4 million. Deposits totaled $24.7 billion, down $174.6 million from the previous quarter. Umpqua remains committed to pandemic response measures, including a 3.08% net interest margin.

Positive

• Net income increased by $72 million from Q2 2020 to $124.9 million.
• Earnings per share rose to $0.57, up from $0.24 in Q2 2020.
• Home lending division produced $2.2 billion in loans during the quarter.
• Provision for credit losses decreased by $87.4 million.
• Net interest income grew by $4.1 million quarter-over-quarter.

Negative

• Total deposits decreased by $174.6 million from the prior quarter.
• Gross loans and leases decreased by $245 million, due to payoffs in commercial real estate.

PORTLAND, Ore., Oct. 21, 2020 /PRNewswire/ -- Umpqua Holdings Corporation (NASDAQ: UMPQ) (the "Company") reported net income of $124.9 million for the third quarter of 2020, compared to $52.9 million for the second quarter of 2020 and $84.5 million for the third quarter of 2019. Earnings per diluted common share were $0.57 for the third quarter of 2020, compared to $0.24 for the second quarter of 2020 and $0.38 for the third quarter of 2019.

"Umpqua's third quarter results represent a record level of net income driven by another outstanding performance by our home lending division who generated production of $2.2 billion this past quarter and by a continued decline in our cost of interest bearing deposits. In addition, we remain confident in the credit quality of our loan portfolio as our current deferral levels decreased to 2.3%." said Cort O'Haver, president and CEO of Umpqua Holdings Corporation. "We launched Next Gen 2.0 this quarter as a continuation of the great progress we have made these past three years modernizing the bank, advancing technology initiatives and improving operating leverage."

Ongoing impact of COVID-19 on our business operations:

• Operations have been modified to comply with multiple state-level proclamations and Center for Disease Control and Prevention (CDC) guidance and best practices; we continue to:
• restrict travel.
• maintain a remote work program for associates other than store associates and small groups of other functions that cannot be completed remotely.  About 90% of our non-store associates are operating remotely.
• transitioned store operations to restrict lobby access and serve customers in-store by appointment only which has allowed over 94% of stores on any given day to remain open throughout the crisis.
• increased cleaning scope and frequency at our store locations and installed other protective devices for our associates and customers.
• Mobile banking usage trends are up 9% and unique sessions are up 7% year over year in addition to an expected decline in store transactions of over 27%.
• Continue to offer our Umpqua Go-To® application with over 70,000 customers using the application.  Go-To usage increased 38% from the prior quarter levels as customers used the platform as a safe and effective way of conducting banking. 
• We enhanced associate benefits, including:
• supplemental front line associate pay.
• pandemic pay bank for associates needing additional paid time off due to COVID-19 impacts.
• flexible work rotations and remote work for higher-risk associates.
• Active participant in PPP, including:
• over 16,900 PPP loans produced.
• $2.05 billion in total loans were funded.
• average loan size was $121,000.
• Addressing other customer needs during pandemic:
• payment deferrals.
• waiving deferral associated fees.
• ATM fee waivers.
• Enhanced community support:
• announced a total of $3.0 million in combined grants and investments to organizations providing COVID-19 community relief and small business microloans.
• initiated virtual volunteerism program.
• activated an associate 3:1 giving match to donations.

Notable items that impacted the third quarter 2020 financial results included:

• Provision for credit losses decreased by $87.4 million as compared to the previous quarter and $23.6 million as compared to the same period of the prior year, due to changes in loan portfolio mix and balances as well as the stabilization of credit quality metrics and economic forecasts used in credit models.
• $12.2 million loss on the fair value change of the mortgage servicing rights (MSR) asset due to changes in model inputs compared to a $6.4 million loss in the prior quarter and a $11.0 million gain in the same period of the prior year.
• $1.8 million gain related to the fair value of the debt capital market swap derivatives, compared to a loss of $0.8 million in the prior quarter and a loss of $4.6 million in the same period of the prior year.

Third Quarter 2020 Highlights (compared to prior quarter):

• Net interest income increased by $4.1 million on a quarter to quarter basis primarily driven by lower costs of interest-bearing deposits;
• Provision for credit losses decreased by $87.4 million due to changes in loan portfolio mix and balances as well as the stabilization of credit quality metrics and economic forecasts used in credit models;
• Net charge-offs decreased by five basis points to 0.24% of average loans and leases (annualized);
• Non-interest income increased by $16.4 million, driven primarily by an increase in net mortgage banking revenue and the sale of three store locations completed during the quarter;
• Non-interest expense increased by $8.3 million, primarily due to an increase in group insurance costs, lower deferred origination costs, higher mortgage commissions due to strong mortgage production, and higher other expenses, partially offset by lower FDIC assessment costs;
• Non-performing assets to total assets increased two basis points to 0.27% from 0.25%;
• Estimated total risk-based capital ratio of 14.9% and estimated Tier 1 common to risk weighted assets ratio of 11.6%;
• Paid a quarterly cash dividend of $0.21 per common share on August 31, 2020 to shareholders of record as of August 20, 2020.

Balance Sheet
Total consolidated assets were $29.4 billion as of September 30, 2020, compared to $29.6 billion as of June 30, 2020 and $28.9 billion as of September 30, 2019.  Including secured off-balance sheet lines of credit, total available liquidity was $11.2 billion as of September 30, 2020, representing 38% of total assets and 45% of total deposits.

Gross loans and leases were $22.4 billion as of September 30, 2020, a decrease of $245.0 million relative to June 30, 2020.  The decrease in gross loans and leases is primarily due to the payoffs in commercial real estate that occurred during the quarter as well as a decrease in utilization rates of commercial lines of credit.  Please refer to the additional loan tables in the Q3 2020 Earnings Presentation for select underwriting characteristics of the loan portfolio and specific industry concentrations impacted by COVID-19.

Total deposits were $24.7 billion as of September 30, 2020, a decrease of $174.6 million from $24.8 billion as of June 30, 2020. This decrease was attributable to a decline in time deposits of $612.5 million partially offset by growth in non-interest bearing demand deposits of $303.0 million.

Net Interest Income
Net interest income was $216.6 million for the third quarter of 2020, up $4.1 million from the prior quarter.  The increase was primarily driven by lower costs of interest bearing deposits compared to the previous quarter.

The Company's net interest margin was 3.08% for the third quarter of 2020, down one basis point from 3.09% for the second quarter of 2020 primarily driven by lower yields on loans held for investment offset by lower costs of interest bearing deposits.

Credit Quality
The allowance for credit losses was $369.4 million, or 1.65% of loans and leases, as of September 30, 2020, which was down from $383.1 million, or 1.69% of loans and leases, as of June 30, 2020.  The provision for credit losses decreased by $87.4 million from the prior quarter level primarily due to changes in portfolio mix and balances as well as the stabilization of credit quality metrics and economic forecasts used in credit models.

Net charge-offs as a percentage of average loans and leases decreased by five basis points to 0.24% of average loans and leases (annualized) as of September 30, 2020.  The decrease in net charge-offs for the quarter was primarily due to continued, stable credit performance of the loan portfolio in addition to a select amount of borrowers using available deferral options.  As of September 30, 2020, non-performing assets were 0.27% of total assets, compared to 0.25% as of June 30, 2020 and 0.25% as of September 30, 2019.

Current Expected Credit Loss (CECL)
As described in our first quarter 2020 quarterly report on Form 10-Q filed on May 7, 2020 ("Q1 2020 10-Q"), 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, our financial results are affected as soon as weak or deteriorating economic conditions are forecasted which alters our expectations for credit losses. In addition, due to the expansion of the time horizon over which we are required to estimate future credit losses under CECL, we may experience increased volatility in our future provisions for credit losses. Specifically, we use credit models that factor in economic forecasts, which at the beginning of the COVID-19 pandemic projected significant, negative COVID-19 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 have stabilized, we recorded a small recapture of the allowance for credit losses in the current period.

Non-interest Income
Non-interest income was $131.9 million for the third quarter of 2020, up $16.4 million from the prior quarter driven primarily by the increase in net mortgage banking revenue and the sale of three store locations completed during the period.

Revenue from the origination and sale of residential mortgages was $98.7 million for the third quarter of 2020, an increase of $11.9 million from the prior quarter. This increase reflects a sequential quarter increase of $96.7 million or 5% in for-sale mortgage origination volume and an increase of 38 basis points in the home lending gain on sale margin to 5.13% for the third quarter of 2020. Of the current quarter's mortgage production, 46% related to purchase activity, compared to 34% for the prior quarter and 60% for the same period of the prior year.

Non-interest Expense
Non-interest expense was $190.2 million for the third quarter of 2020, up $8.3 million from the prior quarter level. This increase was primarily due to higher group insurance costs, lower deferred origination costs, higher mortgage commissions due to strong mortgage production, and higher other expenses, partially offset by lower FDIC assessment costs.

Goodwill
As described in our Q1 2020 10-Q, the Company completed the analysis of goodwill prior to filing the Q1 2020 10-Q with the Securities and Exchange Commission.  The Company updated its goodwill assessment for the Wholesale Bank and Retail Bank reporting units as of March 31, 2020, due to events and circumstances indicating potential impairment. Impairment of goodwill is the condition that exists when the carrying amount of a reporting unit that includes goodwill exceeds its fair value. A goodwill impairment is recognized for the amount that the carrying amount of a reporting unit, including goodwill, exceeds its fair value, limited to the total amount of goodwill allocated to that reporting unit.  Upon completing the quantitative impairment analysis, the Company recorded a goodwill impairment of $1.8 billion during the first quarter, which represented the entire amount of goodwill allocated to the Wholesale Bank and Retail Bank reporting units. The remaining goodwill of $2.7 million after the impairment relates to the Wealth Management reporting unit.  The goodwill impairment was material to reported earnings in the first quarter, but was a non-cash charge and had no effect on the Company's cash balances, liquidity or tangible equity. In addition, because goodwill and other intangible assets are not included in the calculation of regulatory capital, the Company's well-capitalized regulatory capital ratios were not impacted by the impairment.

Capital
As of September 30, 2020, the Company's tangible book value per common share¹ was $11.77, compared to $11.44 in the prior quarter and $11.27 in the same period of the prior year.

The Company's estimated total risk-based capital ratio was 14.9% and its estimated Tier 1 common to risk weighted assets ratio was 11.6% as of September 30, 2020. The Company remains above current "well-capitalized" regulatory minimums.  The regulatory capital ratios as of September 30, 2020 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)		Sep 30, 2020				Jun 30, 2020				Mar 31, 2020				Dec 31, 2019				Sep 30, 2019
Total shareholders' equity		$	2,610,244			$	2,538,339			$	2,507,611			$	4,313,915			$	4,289,516
Subtract:
Goodwill		2,715				2,715				2,715				1,787,651				1,787,651
Other intangible assets, net		14,606				15,853				17,099				18,346				19,750
Tangible common shareholders' equity		$	2,592,923			$	2,519,771			$	2,487,797			$	2,507,918			$	2,482,115
Total assets		$	29,437,441			$	29,645,248			$	27,540,382			$	28,846,809			$	28,930,855
Subtract:
Goodwill		2,715				2,715				2,715				1,787,651				1,787,651
Other intangible assets, net		14,606				15,853				17,099				18,346				19,750
Tangible assets		$	29,420,120			$	29,626,680			$	27,520,568			$	27,040,812			$	27,123,454
Common shares outstanding at period end		220,222				220,219				220,175				220,229				220,212
Total shareholders' equity to total assets ratio		8.87		%		8.56		%		9.11		%		14.95		%		14.83		%
Tangible common equity ratio		8.81		%		8.51		%		9.04		%		9.27		%		9.15		%
Book value per common share		$	11.85			$	11.53			$	11.39			$	19.59			$	19.48
Tangible book value per common share		$	11.77			$	11.44			$	11.30			$	11.39			$	11.27

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 also owns a retail brokerage subsidiary, Umpqua Investments, Inc., which has locations in Umpqua Bank stores and in dedicated offices in Oregon. Umpqua Holdings Corporation is headquartered in Portland, Oregon. For more information, visit umpquabank.com.

Earnings Conference Call Information
The Company will host its third quarter 2020 earnings conference call on October 22, 2020, 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 third quarter 2020 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: 4653597.  A re-broadcast will be available approximately two hours after the call by dialing (855) 859-2056 and entering conference ID 4653597. The earnings conference call will also be available as an audio cast, which can be accessed on the Company's investor relations page at umpquabank.com.

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 Next Gen 2.0 initiatives, the projected impact on our business operations of the COVID-19 global pandemic and future credit losses under CECL.  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)	Sep 30, 2020				Jun 30, 2020				Mar 31, 2020				Dec 31, 2019				Sep 30, 2019				Seq. Quarter			Year over Year
Interest income:
Loans and leases	$	229,457			$	235,174			$	245,993			$	262,109			$	266,111			(2)	%		(14)	%
Interest and dividends on investments:
Taxable	10,168				9,015				16,605				13,361				12,546				13	%		(19)	%
Exempt from federal income tax	1,490				1,520				1,562				1,638				1,727				(2)	%		(14)	%
Dividends	710				568				678				579				599				25	%		19	%
Temporary investments and interest bearing deposits	474				403				3,331				4,343				4,204				18	%		(89)	%
Total interest income	242,299				246,680				268,169				282,030				285,187				(2)	%		(15)	%
Interest expense:
Deposits	19,121				26,222				40,290				44,380				45,876				(27)	%		(58)	%
Securities sold under agreement to repurchase and federal funds purchased	84				194				395				431				448				(57)	%		(81)	%
Borrowings	3,271				3,839				4,046				5,080				4,238				(15)	%		(23)	%
Junior subordinated debentures	3,249				3,922				4,903				5,325				5,652				(17)	%		(43)	%
Total interest expense	25,725				34,177				49,634				55,216				56,214				(25)	%		(54)	%
Net interest income	216,574				212,503				218,535				226,814				228,973				2	%		(5)	%
(Recapture) provision for credit losses	(338)				87,085				118,085				16,252				23,227				(100)	%		(101)	%
Non-interest income:
Service charges on deposits	14,438				11,831				15,638				16,656				16,627				22	%		(13)	%
Brokerage revenue	3,686				3,805				4,015				4,027				4,060				(3)	%		(9)	%
Residential mortgage banking revenue, net	90,377				83,877				17,540				34,050				47,000				8	%		92	%
Gain (loss) on sale of debt securities, net	—				323				(133)				2				—				(100)	%		nm
(Loss) gain on equity securities, net	(112)				240				814				(84)				257				(147)	%		(144)	%
Gain on loan and lease sales, net	1,092				1,074				1,167				4,603				1,762				2	%		(38)	%
BOLI income	2,087				2,116				2,129				2,078				2,067				(1)	%		1	%
Other income (expense)	20,356				12,214				(525)				22,417				16,739				67	%		22	%
Total non-interest income	131,924				115,480				40,645				83,749				88,512				14	%		49	%
Non-interest expense:
Salaries and employee benefits	120,337				116,676				109,774				108,847				106,819				3	%		13	%
Occupancy and equipment, net	36,720				36,171				37,001				36,513				35,446				2	%		4	%
Intangible amortization	1,247				1,246				1,247				1,404				1,405				0	%		(11)	%
FDIC assessments	2,989				3,971				2,542				2,867				2,587				(25)	%		16	%
Goodwill impairment	—				—				1,784,936				—				—				nm			nm
Other expenses	28,914				23,846				27,158				33,812				37,333				21	%		(23)	%
Total non-interest expense	190,207				181,910				1,962,658				183,443				183,590				5	%		4	%
Income (loss) before provision for income taxes	158,629				58,988				(1,821,563)				110,868				110,668				169	%		43	%
Provision for income taxes	33,758				6,062				30,384				27,118				26,166				457	%		29	%
Net income (loss)	$	124,871			$	52,926			$	(1,851,947)			$	83,750			$	84,502			136	%		48	%
Weighted average basic shares outstanding	220,221				220,210				220,216				220,222				220,285				0	%		0	%
Weighted average diluted shares outstanding	220,418				220,320				220,216				220,671				220,583				0	%		0	%
Earnings (loss) per common share – basic	$	0.57			$	0.24			$	(8.41)			$	0.38			$	0.38			138	%		50	%
Earnings (loss) per common share – diluted	$	0.57			$	0.24			$	(8.41)			$	0.38			$	0.38			138	%		50	%
nm = not meaningful

 

Umpqua Holdings Corporation
Consolidated Statements of Operations
(Unaudited)
		Nine Months Ended								% Change
(In thousands, except per share data)		Sep 30, 2020				Sep 30, 2019				Year over Year
Interest income:
Loans and leases		$	710,624			$	788,968			(10)	%
Interest and dividends on investments:
Taxable		35,788				42,789				(16)	%
Exempt from federal income tax		4,572				5,762				(21)	%
Dividends		1,956				1,690				16	%
Temporary investments and interest bearing deposits		4,208				9,837				(57)	%
Total interest income		757,148				849,046				(11)	%
Interest expense:
Deposits		85,633				123,561				(31)	%
Securities sold under agreement to repurchase and federal funds purchased		673				1,661				(59)	%
Borrowings		11,156				12,484				(11)	%
Junior subordinated debentures		12,074				17,520				(31)	%
Total interest expense		109,536				155,226				(29)	%
Net interest income		647,612				693,820				(7)	%
Provision for credit losses		204,832				56,263				264	%
Non-interest income:
Service charges on deposits		41,907				47,858				(12)	%
Brokerage revenue		11,506				11,850				(3)	%
Residential mortgage banking revenue, net		191,794				67,760				183	%
Gain (loss) on sale of debt securities, net		190				(7,186)				(103)	%
Gain on equity securities, net		942				83,559				(99)	%
Gain on loan and lease sales, net		3,333				5,864				(43)	%
BOLI income		6,332				6,328				0	%
Other income		32,045				40,042				(20)	%
Total non-interest income		288,049				256,075				12	%
Non-interest expense:
Salaries and employee benefits		346,787				311,526				11	%
Occupancy and equipment, net		109,892				107,723				2	%
Intangible amortization		3,740				4,214				(11)	%
FDIC assessments		9,502				8,366				14	%
Goodwill impairment		1,784,936				—				nm
Other expenses		79,918				103,768				(23)	%
Total non-interest expense		2,334,775				535,597				336	%
(Loss) income before provision for income taxes		(1,603,946)				358,035				(548)	%
Provision for income taxes		70,204				87,690				(20)	%
Net (loss) income		$	(1,674,150)			$	270,345			(719)	%
Weighted average basic shares outstanding		220,216				220,379				0	%
Weighted average diluted shares outstanding		220,216				220,642				0	%
(Loss) earnings per common share – basic		$	(7.60)			$	1.23			(718)	%
(Loss) earnings per common share – diluted		$	(7.60)			$	1.23			(718)	%
nm = not meaningful

 

Umpqua Holdings Corporation Consolidated Balance Sheets
(Unaudited)
																					% Change
(In thousands, except per share data)	Sep 30, 2020				Jun 30, 2020				Mar 31, 2020				Dec 31, 2019				Sep 30, 2019				Seq. Quarter			Year over Year
Assets:
Cash and due from banks	$	370,595			$	410,769			$	406,426			$	382,598			$	433,620			(10)	%		(15)	%
Interest bearing cash and temporary investments	1,849,132				1,853,505				1,251,290				980,158				757,824				0	%		144	%
Investment securities:
Equity and other, at fair value	82,769				81,958				80,797				80,165				64,764				1	%		28	%
Available for sale, at fair value	2,898,700				2,865,690				2,890,475				2,814,682				2,842,076				1	%		2	%
Held to maturity, at amortized cost	3,088				3,143				3,200				3,260				3,320				(2)	%		(7)	%
Loans held for sale, at fair value	683,960				605,399				481,541				513,431				355,022				13	%		93	%
Loans and leases	22,426,473				22,671,455				21,251,478				21,195,684				21,520,794				(1)	%		4	%
Allowance for credit losses on loans and leases	(345,049)				(356,745)				(291,420)				(157,629)				(156,288)				(3)	%		121	%
Net loans and leases	22,081,424				22,314,710				20,960,058				21,038,055				21,364,506				(1)	%		3	%
Restricted equity securities	50,062				54,062				58,062				46,463				54,463				(7)	%		(8)	%
Premises and equipment, net	185,104				192,041				195,390				201,460				203,391				(4)	%		(9)	%
Operating lease right-of-use assets	107,321				111,487				115,485				110,718				108,187				(4)	%		(1)	%
Goodwill	2,715				2,715				2,715				1,787,651				1,787,651				0	%		(100)	%
Other intangible assets, net	14,606				15,853				17,099				18,346				19,750				(8)	%		(26)	%
Residential mortgage servicing rights, at fair value	93,248				96,356				94,346				115,010				151,383				(3)	%		(38)	%
Bank owned life insurance	326,120				324,873				322,717				320,611				318,533				0	%		2	%
Other assets	688,597				712,687				660,781				434,201				466,365				(3)	%		48	%
Total assets	$	29,437,441			$	29,645,248			$	27,540,382			$	28,846,809			$	28,930,855			(1)	%		2	%
Liabilities:
Deposits	$	24,669,783			$	24,844,378			$	22,699,375			$	22,481,504			$	22,434,734			(1)	%		10	%
Securities sold under agreements to repurchase	388,028				398,414				346,245				311,308				296,717				(3)	%		31	%
Borrowings	996,520				1,096,559				1,196,597				906,635				1,106,674				(9)	%		(10)	%
Junior subordinated debentures, at fair value	247,045				232,936				195,521				274,812				267,798				6	%		(8)	%
Junior subordinated debentures, at amortized cost	88,325				88,382				88,439				88,496				88,553				0	%		0	%
Operating lease liabilities	115,790				119,885				123,962				119,429				116,924				(3)	%		(1)	%
Deferred tax liability, net	13,239				21,439				51,061				52,928				67,055				(38)	%		(80)	%
Other liabilities	308,467				304,916				331,571				297,782				262,884				1	%		17	%
Total liabilities	26,827,197				27,106,909				25,032,771				24,532,894				24,641,339				(1)	%		9	%
Shareholders' equity:
Common stock	3,512,153				3,510,145				3,507,680				3,514,000				3,511,493				0	%		0	%
(Accumulated deficit) retained earnings	(1,036,931)				(1,115,414)				(1,168,340)				770,366				733,059				(7)	%		(241)	%
Accumulated other comprehensive income	135,022				143,608				168,271				29,549				44,964				(6)	%		200	%
Total shareholders' equity	2,610,244				2,538,339				2,507,611				4,313,915				4,289,516				3	%		(39)	%
Total liabilities and shareholders' equity	$	29,437,441			$	29,645,248			$	27,540,382			$	28,846,809			$	28,930,855			(1)	%		2	%
Common shares outstanding at period end	220,222				220,219				220,175				220,229				220,212				0	%		0	%
Book value per common share	$	11.85			$	11.53			$	11.39			$	19.59			$	19.48			3	%		(39)	%
Tangible book value per common share	$	11.77			$	11.44			$	11.30			$	11.39			$	11.27			3	%		4	%
Tangible equity - common	$	2,592,923			$	2,519,771			$	2,487,797			$	2,507,918			$	2,482,115			3	%		4	%
Tangible common equity to tangible assets	8.81		%		8.51		%		9.04		%		9.27		%		9.15		%		0.30			(0.34)

 

Umpqua Holdings Corporation
Loan and Lease Portfolio
(Unaudited)
	Sep 30, 2020				Jun 30, 2020				Mar 31, 2020				Dec 31, 2019				Sep 30, 2019				% 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	$	3,533,776			$	3,589,484			$	3,613,420			$	3,545,566			$	3,495,555			(2)	%		1	%
Owner occupied term, net	2,411,098				2,459,954				2,472,187				2,496,088				2,566,299				(2)	%		(6)	%
Multifamily, net	3,389,034				3,466,829				3,464,217				3,514,774				3,479,986				(2)	%		(3)	%
Construction & development, net	757,462				662,703				667,975				678,740				771,214				14	%		(2)	%
Residential development, net	163,400				164,180				187,594				189,010				191,500				0	%		(15)	%
Commercial:
Term, net (1)	4,246,229				4,265,092				2,317,573				2,232,817				2,310,759				0	%		84	%
Lines of credit & other, net	894,782				940,443				1,208,051				1,212,393				1,254,755				(5)	%		(29)	%
Leases & equipment finance, net	1,496,650				1,522,369				1,492,762				1,465,489				1,485,753				(2)	%		1	%
Residential:
Mortgage, net	4,042,416				4,056,588				4,193,908				4,215,424				4,245,674				0	%		(5)	%
Home equity loans & lines, net	1,172,697				1,189,428				1,249,152				1,237,512				1,224,578				(1)	%		(4)	%
Consumer & other, net	318,929				354,385				384,639				407,871				494,721				(10)	%		(36)	%
Total loans, net of deferred fees and costs	$	22,426,473			$	22,671,455			$	21,251,478			$	21,195,684			$	21,520,794			(1)	%		4	%
(1)  The Bank participates in the Payroll Protection Program ("PPP") 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 16,900 PPP loans, totaling $2.0 billion, net of deferred fees and costs as of September 30, 2020.
Loan and leases mix:
Commercial real estate:
Non-owner occupied term, net	16		%		16		%		17		%		17		%		16		%
Owner occupied term, net	11		%		11		%		12		%		12		%		12		%
Multifamily, net	15		%		15		%		16		%		16		%		16		%
Construction & development, net	3		%		3		%		3		%		3		%		4		%
Residential development, net	1		%		1		%		1		%		1		%		1		%
Commercial:
Term, net	19		%		19		%		11		%		10		%		11		%
Lines of credit & other, net	4		%		4		%		5		%		6		%		6		%
Leases & equipment finance, net	7		%		7		%		7		%		7		%		7		%
Residential:
Mortgage, net	18		%		18		%		20		%		20		%		20		%
Home equity loans & lines, net	5		%		5		%		6		%		6		%		5		%
Consumer & other, net	1		%		1		%		2		%		2		%		2		%
Total	100		%		100		%		100		%		100		%		100		%

 

Umpqua Holdings Corporation
Deposits by Type/Core Deposits
(Unaudited)
	Sep 30, 2020				Jun 30, 2020				Mar 31, 2020				Dec 31, 2019				Sep 30, 2019				% Change
(Dollars in thousands)	Amount				Amount				Amount				Amount				Amount				Seq. Quarter			Year over Year
Deposits:
Demand, non-interest bearing	$	9,475,244			$	9,172,210			$	7,169,907			$	6,913,375			$	7,123,180			3	%		33	%
Demand, interest bearing	2,931,990				2,813,722				2,482,908				2,524,534				2,406,404				4	%		22	%
Money market	7,160,838				7,262,777				7,082,011				6,930,815				6,646,383				(1)	%		8	%
Savings	1,848,639				1,730,051				1,486,909				1,471,475				1,469,302				7	%		26	%
Time	3,253,072				3,865,618				4,477,640				4,641,305				4,789,465				(16)	%		(32)	%
Total	$	24,669,783			$	24,844,378			$	22,699,375			$	22,481,504			$	22,434,734			(1)	%		10	%
Total core deposits (1)	$	22,439,241			$	22,095,314			$	19,434,228			$	19,061,058			$	18,845,328			2	%		19	%
Deposit mix:
Demand, non-interest bearing	38		%		37		%		32		%		31		%		32		%
Demand, interest bearing	12		%		11		%		11		%		11		%		11		%
Money market	29		%		29		%		31		%		31		%		30		%
Savings	8		%		7		%		7		%		6		%		6		%
Time	13		%		16		%		19		%		21		%		21		%
Total	100		%		100		%		100		%		100		%		100		%
Number of open accounts:
Demand, non-interest bearing	423,658				423,456				416,270				415,254				413,633
Demand, interest bearing	73,812				74,813				75,514				75,900				76,390
Money market	59,083				59,445				59,203				58,888				58,796
Savings	162,234				161,710				159,870				159,948				160,673
Time	52,572				57,501				62,515				62,952				62,122
Total	771,359				776,925				773,372				772,942				771,614
Average balance per account:
Demand, non-interest bearing	$	22.4			$	21.7			$	17.2			$	16.6			$	17.2
Demand, interest bearing	39.7				37.6				32.9				33.3				31.5
Money market	121.2				122.2				119.6				117.7				113.0
Savings	11.4				10.7				9.3				9.2				9.1
Time	61.9				67.2				71.6				73.7				77.1
Total	$	32.0			$	32.0			$	29.4			$	29.1			$	29.1

(1)  Core deposits are defined as total deposits less time deposits greater than $100,000.

 

Umpqua Holdings Corporation
Credit Quality – Non-performing Assets
(Unaudited)
		Quarter Ended																				% Change
(Dollars in thousands)		Sep 30, 2020				Jun 30, 2020				Mar 31, 2020				Dec 31, 2019				Sep 30, 2019				Seq. Quarter			Year over Year
Non-performing assets:
Loans and leases on non-accrual status		$	26,425			$	32,412			$	39,128			$	26,244			$	31,636			(18)	%		(16)	%
Loans and leases past due 90+ days and accruing (1)		50,269				39,818				47,185				37,969				35,745				26	%		41	%
Total non-performing loans and leases		76,694				72,230				86,313				64,213				67,381				6	%		14	%
Other real estate owned		2,369				2,578				3,020				3,295				4,026				(8)	%		(41)	%
Total non-performing assets		$	79,063			$	74,808			$	89,333			$	67,508			$	71,407			6	%		11	%
Performing restructured loans and leases		$	15,819			$	15,032			$	20,541			$	18,576			$	14,309			5	%		11	%
Loans and leases past due 31-89 days		$	66,155			$	40,583			$	59,962			$	41,882			$	44,390			63	%		49	%
Loans and leases past due 31-89 days to total loans and leases		0.29		%		0.18		%		0.28		%		0.20		%		0.21		%
Non-performing loans and leases to total loans and leases (1)		0.34		%		0.32		%		0.41		%		0.30		%		0.31		%
Non-performing assets to total assets(1)		0.27		%		0.25		%		0.32		%		0.23		%		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, $2.6 million, $5.3 million, $4.3 million, and $5.2 million at September 30, 2020, June 30, 2020, March 31, 2020, December 31, 2019, and September 30, 2019, respectively.

 

Umpqua Holdings Corporation
Credit Quality – Allowance for Credit Losses
(Unaudited)
		Quarter Ended																				% Change
(Dollars in thousands)		Sep 30, 2020				Jun 30, 2020				Mar 31, 2020				Dec 31, 2019				Sep 30, 2019				Seq. Quarter			Year over Year
Allowance for credit losses on loans and leases (ACLLL)
Balance, beginning of period		$	356,745			$	291,420			$	157,629			$	156,288			$	151,069			22	%		136	%
Impact of adoption of CECL		—				—				49,999				—				—				nm			nm
Adjusted balance, beginning of period		356,745				291,420				207,628				156,288				151,069				22	%		136	%
Provision for credit losses on loans and leases (1)		1,785				81,484				105,502				16,252				23,227				(98)	%		(92)	%
Charge-offs		(16,646)				(19,453)				(24,455)				(18,734)				(23,112)				(14)	%		(28)	%
Recoveries		3,165				3,294				2,745				3,823				5,104				(4)	%		(38)	%
Net charge-offs		(13,481)				(16,159)				(21,710)				(14,911)				(18,008)				(17)	%		(25)	%
Balance, end of period		$	345,049			$	356,745			$	291,420			$	157,629			$	156,288			(3)	%		121	%
Reserve for unfunded commitments
Balance, beginning of period		$	26,368			$	20,927			$	5,106			$	5,085			$	4,857			26	%		443	%
Impact of adoption of CECL		—				—				3,238				—				—				nm			nm
Adjusted balance, beginning of period		26,368				20,927				8,344				5,085				4,857				26	%		443	%
(Recapture) provision for credit losses on unfunded commitments (1)		(2,062)				5,441				12,583				21				228				(138)	%		nm
Balance, end of period		24,306				26,368				20,927				5,106				5,085				(8)	%		378	%
Total Allowance for credit losses (ACL)		$	369,355			$	383,113			$	312,347			$	162,735			$	161,373			(4)	%		129	%
Net charge-offs to average loans and leases (annualized)		0.24		%		0.29		%		0.41		%		0.28		%		0.34		%
Recoveries to gross charge-offs		19.01		%		16.93		%		11.22		%		20.41		%		22.08		%
ACLLL to loans and leases		1.54		%		1.57		%		1.37		%		0.74		%		0.73		%
ACL to loans and leases		1.65		%		1.69		%		1.47		%		0.77		%		0.75		%
nm = not meaningful

(1)	The total provision for credit losses as disclosed in the income statement includes a recapture of $61,000 related to the provision for accrued interest on loans deferred due to COVID-19, for the three months ended September 30, 2020 and an additional provision of $160,000 for the three months ended June 30, 2020, which are not included in the table above.

 

Umpqua Holdings Corporation
Credit Quality – Allowance for Credit Losses
(Unaudited)
		Nine Months Ended								% Change
(Dollars in thousands)		Sep 30, 2020				Sep 30, 2019				Year over Year
Allowance for credit losses on loans and leases (ACLLL)
Balance, beginning of period		$	157,629			$	144,871			9	%
Impact of adoption of CECL		49,999				—				nm
Adjusted balance, beginning of period		207,628				144,871				43	%
Provision for credit losses on loans and leases (1)		188,771				56,263				236	%
Charge-offs		(60,554)				(56,971)				6	%
Recoveries		9,204				12,125				(24)	%
Net charge-offs		(51,350)				(44,846)				15	%
Balance, end of period		$	345,049			$	156,288			121	%
Reserve for unfunded commitments
Balance, beginning of period		$	5,106			$	4,523			13	%
Impact of adoption of CECL		3,238				—				nm
Adjusted balance, beginning of period		8,344				4,523				84	%
Provision for credit losses on unfunded commitments (1)		15,962				562				nm
Balance, end of period		24,306				5,085				378	%
Total Allowance for credit losses (ACL)		$	369,355			$	161,373			129	%
Net charge-offs to average loans and leases (annualized)		0.31		%		0.29		%
Recoveries to gross charge-offs		15.20		%		21.28		%
nm = not meaningful

(1)	The total provision for credit losses for the nine months ended September 30, 2020, as disclosed on the income statement includes an additional $99,000 of provision related to accrued interest on loans deferred due to COVID-19, not included in the table above.

 

Umpqua Holdings Corporation
Selected Ratios
(Unaudited)
		Quarter Ended															% Change
		Sep 30, 2020			Jun 30, 2020			Mar 31, 2020			Dec 31, 2019			Sep 30, 2019			Seq. Quarter			Year over Year
Average Rates:
Yield on loans held for sale		3.13	%		3.77	%		4.20	%		4.25	%		4.82	%		(0.64)			(1.69)
Yield on loans and leases		3.96	%		4.11	%		4.58	%		4.80	%		4.93	%		(0.15)			(0.97)
Yield on taxable investments		1.56	%		1.38	%		2.50	%		2.05	%		1.99	%		0.18			(0.43)
Yield on tax-exempt investments (1)		3.11	%		3.17	%		3.14	%		3.23	%		3.30	%		(0.06)			(0.19)
Yield on interest bearing cash and temporary investments		0.10	%		0.10	%		1.23	%		1.65	%		2.20	%		—			(2.10)
Total yield on earning assets (1)		3.45	%		3.59	%		4.19	%		4.36	%		4.52	%		(0.14)			(1.07)
Cost of interest bearing deposits		0.49	%		0.67	%		1.03	%		1.13	%		1.19	%		(0.18)			(0.70)
Cost of securities sold under agreements
to repurchase and fed funds purchased		0.09	%		0.21	%		0.47	%		0.56	%		0.57	%		(0.12)			(0.48)
Cost of borrowings		1.23	%		1.33	%		1.79	%		1.96	%		1.95	%		(0.10)			(0.72)
Cost of junior subordinated debentures		4.03	%		5.55	%		5.45	%		5.92	%		6.14	%		(1.52)			(2.11)
Total cost of interest bearing liabilities		0.59	%		0.78	%		1.15	%		1.27	%		1.33	%		(0.19)			(0.74)
Net interest spread (1)		2.85	%		2.81	%		3.04	%		3.09	%		3.19	%		0.04			(0.34)
Net interest margin (1)		3.08	%		3.09	%		3.41	%		3.51	%		3.63	%		(0.01)			(0.55)
Performance Ratios:
Return on average assets		1.68	%		0.73	%		(25.82)	%		1.15	%		1.18	%		0.95			0.50
Return on average tangible assets		1.68	%		0.73	%		(27.53)	%		1.22	%		1.26	%		0.95			0.42
Return on average common equity		19.48	%		8.46	%		(174.94)	%		7.70	%		7.87	%		11.02			11.61
Return on average tangible common equity		19.62	%		8.53	%		(301.30)	%		13.24	%		13.67	%		11.09			5.95
Efficiency ratio – Consolidated		54.52	%		55.40	%		756.29	%		59.00	%		57.76	%		(0.88)			(3.24)
Efficiency ratio – Bank		53.41	%		54.17	%		752.92	%		57.56	%		56.22	%		(0.76)			(2.81)

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

 

Umpqua Holdings Corporation
Selected Ratios
(Unaudited)
		Nine Months Ended						% Change
		Sep 30, 2020			Sep 30, 2019			Year over Year
Average Rates:
Yield on loans held for sale		3.61	%		5.15	%		(1.54)
Yield on loans and leases		4.21	%		5.02	%		(0.81)
Yield on taxable investments		1.81	%		2.20	%		(0.39)
Yield on tax-exempt investments (1)		3.14	%		3.45	%		(0.31)
Yield on interest bearing cash and temporary investments		0.38	%		2.32	%		(1.94)
Total yield on earning assets (1)		3.73	%		4.63	%		(0.90)
Cost of interest bearing deposits		0.73	%		1.11	%		(0.38)
Cost of securities sold under agreements
to repurchase and fed funds purchased		0.25	%		0.68	%		(0.43)
Cost of borrowings		1.43	%		1.96	%		(0.53)
Cost of junior subordinated debentures		5.00	%		6.18	%		(1.18)
Total cost of interest bearing liabilities		0.84	%		1.26	%		(0.42)
Net interest spread (1)		2.89	%		3.37	%		(0.48)
Net interest margin (1)		3.19	%		3.78	%		(0.59)
Performance Ratios:
Return on average assets		(7.67)	%		1.31	%		(8.98)
Return on average tangible assets		(7.83)	%		1.40	%		(9.23)
Return on average common equity		(72.01)	%		8.67	%		(80.68)
Return on average tangible common equity		(89.45)	%		15.32	%		(104.77)
Efficiency ratio – Consolidated		249.26	%		56.31	%		192.95
Efficiency ratio – Bank		247.93	%		54.70	%		193.23

(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)	Sep 30, 2020				Jun 30, 2020				Mar 31, 2020				Dec 31, 2019				Sep 30, 2019				Seq. Quarter			Year over Year
Temporary investments and interest bearing cash	$	1,827,818			$	1,563,753			$	1,084,854			$	1,045,975			$	759,416			17	%		141	%
Investment securities, taxable	2,797,547				2,777,154				2,760,461				2,719,089				2,648,092				1	%		6	%
Investment securities, tax-exempt	237,165				235,934				241,105				244,895				252,765				1	%		(6)	%
Loans held for sale	669,646				577,773				406,434				415,169				328,155				16	%		104	%
Loans and leases	22,560,076				22,428,142				21,196,989				21,379,239				21,170,915				1	%		7	%
Total interest earning assets	28,092,252				27,582,756				25,689,843				25,804,367				25,159,343				2	%		12	%
Goodwill and other intangible assets, net	18,021				19,253				1,785,608				1,806,791				1,808,191				(6)	%		(99)	%
Total assets	29,533,871				29,066,775				28,844,773				28,981,387				28,356,982				2	%		4	%
Non-interest bearing demand deposits	9,335,350				8,484,684				6,880,457				7,037,320				6,880,093				10	%		36	%
Interest bearing deposits	15,451,816				15,803,595				15,695,309				15,550,483				15,289,464				(2)	%		1	%
Total deposits	24,787,166				24,288,279				22,575,766				22,587,803				22,169,557				2	%		12	%
Interest bearing liabilities	17,205,775				17,625,888				17,301,712				17,237,770				16,827,917				(2)	%		2	%
Shareholders' equity - common	2,549,703				2,514,754				4,257,711				4,317,277				4,260,810				1	%		(40)	%
Tangible common equity (1)	2,531,682				2,495,501				2,472,103				2,510,486				2,452,619				1	%		3	%

 

Umpqua Holdings Corporation Average Balances
(Unaudited)
		Nine Months Ended								% Change
(Dollars in thousands)		Sep 30, 2020				Sep 30, 2019				Year over Year
Temporary investments and interest bearing cash		$	1,493,352			$	567,709			163	%
Investment securities, taxable		2,778,460				2,696,001				3	%
Investment securities, tax-exempt		238,059				270,461				(12)	%
Loans held for sale		551,583				260,600				112	%
Loans and leases		22,063,582				20,724,820				6	%
Total interest earning assets		27,125,036				24,519,591				11	%
Goodwill and other intangible assets, net		605,548				1,809,583				(67)	%
Total assets		29,149,758				27,631,632				5	%
Non-interest bearing demand deposits		8,237,095				6,648,638				24	%
Interest bearing deposits		15,649,765				14,891,271				5	%
Total deposits		23,886,860				21,539,909				11	%
Interest bearing liabilities		17,377,259				16,448,027				6	%
Shareholders' equity - common		3,105,611				4,169,008				(26)	%
Tangible common equity (1)		2,500,063				2,359,425				6	%

(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
	September 30, 2020											June 30, 2020											September 30, 2019
(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	$	669,646			$	5,248			3.13	%		$	577,773			$	5,443			3.77	%		$	328,155			$	3,953			4.82	%
Loans and leases (1)	22,560,076				224,209				3.96	%		22,428,142				229,731				4.11	%		21,170,915				262,158				4.93	%
Taxable securities	2,797,547				10,878				1.56	%		2,777,154				9,583				1.38	%		2,648,092				13,145				1.99	%
Non-taxable securities (2)	237,165				1,845				3.11	%		235,934				1,868				3.17	%		252,765				2,086				3.30	%
Temporary investments and interest-bearing cash	1,827,818				474				0.10	%		1,563,753				403				0.10	%		759,416				4,204				2.20	%
Total interest-earning assets	28,092,252				$	242,654			3.45	%		27,582,756				$	247,028			3.59	%		25,159,343				$	285,546			4.52	%
Other assets	1,441,619											1,484,019											3,197,639
Total assets	$	29,533,871										$	29,066,775										$	28,356,982
INTEREST-BEARING LIABILITIES:
Interest-bearing demand deposits	$	2,878,529			$	573			0.08	%		$	2,649,331			$	1,148			0.17	%		$	2,363,626			$	3,117			0.52	%
Money market deposits	7,179,705				2,284				0.13	%		7,275,041				4,037				0.22	%		6,962,370				16,575				0.94	%
Savings deposits	1,790,055				179				0.04	%		1,628,276				198				0.05	%		1,462,198				557				0.15	%
Time deposits	3,603,527				16,085				1.78	%		4,250,947				20,839				1.97	%		4,501,270				25,627				2.26	%
Total interest-bearing deposits	15,451,816				19,121				0.49	%		15,803,595				26,222				0.67	%		15,289,464				45,876				1.19	%
Repurchase agreements and federal funds purchased	378,844				84				0.09	%		375,098				194				0.21	%		313,089				448				0.57	%
Borrowings	1,054,153				3,271				1.23	%		1,163,065				3,839				1.33	%		860,285				4,238				1.95	%
Junior subordinated debentures	320,962				3,249				4.03	%		284,130				3,922				5.55	%		365,079				5,652				6.14	%
Total interest-bearing liabilities	17,205,775				$	25,725			0.59	%		17,625,888				$	34,177			0.78	%		16,827,917				$	56,214			1.33	%
Non-interest-bearing deposits	9,335,350											8,484,684											6,880,093
Other liabilities	443,043											441,449											388,162
Total liabilities	26,984,168											26,552,021											24,096,172
Common equity	2,549,703											2,514,754											4,260,810
Total liabilities and shareholders' equity	$	29,533,871										$	29,066,775										$	28,356,982
NET INTEREST INCOME					$	216,929										$	212,851										$	229,332
NET INTEREST SPREAD									2.85	%										2.81	%										3.19	%
NET INTEREST INCOME TO EARNING ASSETS OR NET INTEREST MARGIN (1), (2)									3.08	%										3.09	%										3.63	%

(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 $355,000 for the three months ended September 30, 2020, as compared to $348,000 for June 30, 2020 and $359,000 for September 30, 2019.

 

Umpqua Holdings Corporation Average Rates and Balances
(Unaudited)
(dollars in thousands)	Nine Months Ended
	September 30, 2020											September 30, 2019
	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	$	551,583			$	14,955			3.61	%		$	260,600			$	10,069			5.15	%
Loans and leases (1)	22,063,582				695,669				4.21	%		20,724,820				778,899				5.02	%
Taxable securities	2,778,460				37,744				1.81	%		2,696,001				44,479				2.20	%
Non-taxable securities (2)	238,059				5,608				3.14	%		270,461				6,991				3.45	%
Temporary investments and interest-bearing cash	1,493,352				4,208				0.38	%		567,709				9,837				2.32	%
Total interest-earning assets	27,125,036				$	758,184			3.73	%		24,519,591				$	850,275			4.63	%
Other assets	2,024,722											3,112,041
Total assets	$	29,149,758										$	27,631,632
INTEREST-BEARING LIABILITIES:
Interest-bearing demand deposits	$	2,667,160			$	5,264			0.26	%		$	2,338,787			$	8,555			0.49	%
Money market deposits	7,187,615				18,080				0.34	%		6,702,551				42,943				0.86	%
Savings deposits	1,635,064				618				0.05	%		1,468,449				1,237				0.11	%
Time deposits	4,159,926				61,671				1.98	%		4,381,484				70,826				2.16	%
Total interest-bearing deposits	15,649,765				85,633				0.73	%		14,891,271				123,561				1.11	%
Repurchase agreements and federal funds purchased	363,957				673				0.25	%		325,281				1,661				0.68	%
Borrowings	1,041,181				11,156				1.43	%		852,659				12,484				1.96	%
Junior subordinated debentures	322,356				12,074				5.00	%		378,816				17,520				6.18	%
Total interest-bearing liabilities	17,377,259				$	109,536			0.84	%		16,448,027				$	155,226			1.26	%
Non-interest-bearing deposits	8,237,095											6,648,638
Other liabilities	429,793											365,959
Total liabilities	26,044,147											23,462,624
Common equity	3,105,611											4,169,008
Total liabilities and shareholders' equity	$	29,149,758										$	27,631,632
NET INTEREST INCOME					$	648,648										$	695,049
NET INTEREST SPREAD									2.89	%										3.37	%
NET INTEREST INCOME TO EARNING ASSETS OR NET INTEREST MARGIN (1), (2)									3.19	%										3.78	%

(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 $1.0 million for the nine months ended September 30, 2020, as compared to $1.2 million for the same period in 2019.

 

Umpqua Holdings Corporation Residential Mortgage Banking Activity
(Unaudited)
	Quarter Ended																				% Change
(Dollars in thousands)	Sep 30, 2020				Jun 30, 2020				Mar 31, 2020				Dec 31, 2019				Sep 30, 2019				Seq. Quarter			Year over Year
Residential mortgage banking revenue:
Origination and sale	$	98,703			$	86,781			$	39,347			$	35,438			$	31,432			14	%		214	%
Servicing	8,796				8,533				8,880				8,981				11,358				3	%		(23)	%
Change in fair value of MSR asset:
Changes due to collection/realization of expected cash flows over time	(4,878)				(5,042)				(5,329)				(5,237)				(6,835)				(3)	%		(29)	%
Changes due to valuation inputs or assumptions	(12,244)				(6,395)				(25,358)				(5,132)				11,045				91	%		(211)	%
Total	$	90,377			$	83,877			$	17,540			$	34,050			$	47,000			8	%		92	%
Closed loan volume:
Portfolio	$	245,550			$	276,247			$	252,329			$	335,511			$	611,022			(11)	%		(60)	%
For-sale	1,922,789				1,826,095				1,148,184				1,060,016				844,442				5	%		128	%
Total	$	2,168,339			$	2,102,342			$	1,400,513			$	1,395,527			$	1,455,464			3	%		49	%
Gain on sale margin:
Based on for-sale volume	5.13		%		4.75		%		3.43		%		3.34		%		3.72		%		0.38			1.41
Residential mortgage servicing rights:
Balance, beginning of period	$	96,356			$	94,346			$	115,010			$	151,383			$	139,780			2	%		(31)	%
Additions for new MSR capitalized	14,014				13,447				10,023				8,397				7,393				4	%		90	%
Sale of MSR assets	—				—				—				(34,401)				—				0	%		0	%
Changes in fair value of MSR asset:
Changes due to collection/realization of expected cash flows over time	(4,878)				(5,042)				(5,329)				(5,237)				(6,835)				(3)	%		(29)	%
Changes due to valuation inputs or assumptions	(12,244)				(6,395)				(25,358)				(5,132)				11,045				91	%		(211)	%
Balance, end of period	$	93,248			$	96,356			$	94,346			$	115,010			$	151,383			(3)	%		(38)	%
Residential mortgage loans serviced for others	$	12,964,361			$	12,746,125			$	12,533,045			$	12,276,943			$	15,707,519			2	%		(17)	%
MSR as % of serviced portfolio	0.72		%		0.76		%		0.75		%		0.94		%		0.96		%		(0.04)			(0.24)

 

Umpqua Holdings Corporation Residential Mortgage Banking Activity
(Unaudited)
	Nine Months Ended								% Change
(Dollars in thousands)	Sep 30, 2020				Sep 30, 2019				Year over Year
Residential mortgage banking revenue:
Origination and sale	$	224,831			$	68,956			226	%
Servicing	26,209				33,218				(21)	%
Change in fair value of MSR asset:
Changes due to collection/realization of expected cash flows over time	(15,249)				(20,171)				(24)	%
Changes due to valuation inputs or assumptions	(43,997)				(14,243)				209	%
Total	$	191,794			$	67,760			183	%
Closed loan volume:
Portfolio	$	774,126			$	1,411,512			(45)	%
For-sale	4,897,068				2,029,682				141	%
Total	$	5,671,194			$	3,441,194			65	%
Gain on sale margin:
Based on for-sale volume	4.59		%		3.40		%		1.19
Residential mortgage servicing rights:
Balance, beginning of period	$	115,010			$	169,025			(32)	%
Additions for new MSR capitalized	37,484				16,772				123	%
Changes in fair value of MSR asset:
Changes due to collection/realization of expected cash flows over time	(15,249)				(20,171)				(24)	%
Changes due to valuation inputs or assumptions	(43,997)				(14,243)				209	%
Balance, end of period	$	93,248			$	151,383			(38)	%

 

View original content to download multimedia:http://www.prnewswire.com/news-releases/umpqua-reports-third-quarter-2020-results-301157127.html

SOURCE Umpqua Holdings Corporation

FAQ

What was Umpqua Holdings Corporation's net income for Q3 2020?

Umpqua reported net income of $124.9 million for Q3 2020.

How much did Umpqua's earnings per share increase in Q3 2020?

Earnings per share increased to $0.57 in Q3 2020.

What was the total deposit amount for Umpqua as of September 30, 2020?

Total deposits were $24.7 billion as of September 30, 2020.

How did Umpqua's provision for credit losses change in Q3 2020?

Provision for credit losses decreased by $87.4 million from the previous quarter.

What was the performance of Umpqua's home lending division in Q3 2020?

The home lending division generated $2.2 billion in production.