Umpqua Reports Second Quarter 2020 Results

  PORTLAND, Ore., July 22, 2020 /PRNewswire/ — Umpqua Holdings Corporation (NASDAQ: UMPQ) (the “Company”) reported net earnings of $52.9…

 

PORTLAND, Ore., July 22, 2020 /PRNewswire/ — Umpqua Holdings Corporation (NASDAQ: UMPQ) (the “Company”) reported net earnings of $52.9 million for the second quarter of 2020, compared to net loss of $1.9 billion for the first quarter of 2020 and net income of $111.8 million for the second quarter of 2019. Earnings per diluted common share were $0.24 for the second quarter of 2020, compared to a loss of $8.41 for the first quarter of 2020 and earnings of $0.51 for the second quarter of 2019.

Umpqua’s second quarter results, particularly in light of the significant disruption due to the COVID-19 pandemic, are a testament to our associates’ extraordinary resilience and commitment to serving our customers and communities. During the quarter, as we ramped up our efforts to support small businesses across our footprint, we rapidly processed and funded more than 15,000 PPP loans with an average loan size of $134,000. In addition, our home lending department had a record-breaking quarter, generating more than $2.1 billion in production,” said Cort O’Haver, president and CEO of Umpqua Holdings Corporation. “We continue working with customers who qualify for payment deferrals as a result of COVID-19 impacts with a 5.7% deferral level that reflects the company’s strong credit quality practices. I’m especially pleased with the reduction in our cost of interest bearing deposits and lower non-interest expenses, absent increased home lending commissions due to volume, as we operate in a low interest rate environment.”

Ongoing impact of COVID-19 on our business operations:

  • Operations have been modified to comply with multiple state-level proclamations and CDC guidance and best practice; we continue to:
    • restrict all 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 instructed customers to bank by appointment only which has allowed over 95% of stores on any given day to remain open throughout the crisis.
    • increased cleaning scope and frequency to our store locations and installed other protective devices for our associates.
  • Mobile banking usage trends are up 21% and unique sessions are up 30% year over year in addition to an expected decline in store transactions of over 31%.
  • Continue to offer our Umpqua Go-To® application with over 63,000 customers enrolled. Go-To usage increased 48% 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 15,000 PPP loans produced.
    • $2.0 billion in total loans were funded.
    • average loan size was $134,000.
  • 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 second quarter 2020 financial results included:

  • $87.1 million provision for credit losses reflecting the continued impacts of the COVID-19 global pandemic on economic forecasts, compared to a $118.1 million provision in the prior quarter, and a $19.4 million provision in the same period of the prior year.
  • $6.4 million loss on the fair value change of the MSR asset due to accelerated prepayments as a result of the lower interest rate environment compared to a $25.4 million loss in the prior quarter and a $17.8 million loss in the same period of the prior year.
  • $0.8 million loss related to the fair value of the debt capital market swap derivatives, compared to a loss of $14.3 million in the prior quarter and a loss of $4.0 million in the same period of the prior year.

Second Quarter 2020 Highlights (compared to prior quarter):

  • Net interest income decreased by $6.0 million on a quarter to quarter basis primarily driven by lower average yields on loans and leases, partially offset by a lower cost of interest bearing deposits;
  • Provision for credit losses decreased by $31.0 million, although still elevated from historical levels reflecting the continued influence of the COVID-19 global pandemic on economic forecasts;
  • Net charge-offs decreased by twelve basis points to 0.29% of average loans and leases (annualized);
  • Non-interest income increased by $74.8 million, driven primarily by an increase in net mortgage banking revenue;
  • Non-interest expense decreased by $1.8 billion, driven by the $1.8 billion goodwill impairment that was recorded in the prior period. Absent the goodwill impairment charge, non-interest expense increased by $4.2 million from the prior quarter primarily due to strong mortgage production;
  • Non-performing assets to total assets decreased six basis points to 0.26% from 0.32%;
  • Estimated total risk-based capital ratio of 14.4% and estimated Tier 1 common to risk weighted assets ratio of 11.1%;
  • Filed a Form 8-K on June 17, 2020, announcing the shift in timing of a dividend declaration date from historical intra-quarter announcements to after quarterly earnings are finalized and applicable regulatory approval processes are complete.

Balance Sheet

Total consolidated assets were $29.6 billion as of June 30, 2020, compared to $27.5 billion as of March 31, 2020 and $28.0 billion as of June 30, 2019.  Including secured off-balance sheet lines of credit, total available liquidity was $11.7 billion as of June 30, 2020, representing 39% of total assets and 47% of total deposits.

Gross loans and leases were $22.7 billion as of June 30, 2020, an increase of $1.4 billion relative to March 31, 2020.  The increase in gross loans and leases is primarily due to the production of the PPP loans totaling $2.0 billion in the quarter. Please refer to the additional loan tables in the Q2 2020 Earnings Presentation for select underwriting characteristics of the loan portfolio and specific industry concentrations impacted by COVID-19.

Total deposits were $24.8 billion as of June 30, 2020, an increase of $2.1 billion from $22.7 billion as of March 31, 2020. This increase was attributable to growth in non-interest bearing demand deposits of $2.0 billion partially offset by a decline in time deposits of $612.0 million.

Net Interest Income

Net interest income was $212.5 million for the second quarter of 2020, down $6.0 million from the prior quarter.  The decrease was primarily driven by lower average yields on loans and leases, partially offset by a lower cost of interest bearing deposits.

The Company’s net interest margin was 3.09% for the second quarter of 2020, down 32 basis points from 3.41% for the first quarter of 2020 primarily driven by the decrease in short and long term interest rates that occurred in the prior quarter.

Credit Quality

The allowance for credit losses was $383.1 million, or 1.69% of loans and leases, as of June 30, 2020, which was up from $312.3 million, or 1.47% of loans and leases, as of March 31, 2020.  The provision for credit losses was $87.1 million for the second quarter of 2020, a decrease of $31.0 million from the prior quarter level, although still elevated from historical levels reflecting the continued influence of the COVID-19 global pandemic on economic forecasts.

Net charge-offs as a percentage of average loans and leases decreased by twelve basis points to 0.29% of average loans and leases (annualized).  The decrease in net charge-offs for the quarter was primarily due to the COVID-19 related single charge-off to a regional air transportation lessor that occurred in the prior quarter.  As of June 30, 2020, non-performing assets were 0.26% of total assets, compared to 0.32% as of March 31, 2020 and 0.28% as of June 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 will be 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. When utilizing economic forecast models that factor in significant, negative COVID-19 impacts to the economy, we recorded significant provisions for credit losses in the first and second quarters of 2020 and may incur significant provisions for credit losses in future periods as well as actual or projected economic conditions deteriorate further.

Non-interest Income

Non-interest income was $115.5 million for the second quarter of 2020, up $74.8 million from the prior quarter driven primarily by the increase in net mortgage banking revenue as described below.

Revenue from the origination and sale of residential mortgages was $86.8 million for the second quarter of 2020, an increase of $47.4 million from the prior quarter. This increase reflects a sequential quarter increase of $677.9 million or 59% in for-sale mortgage origination volume and an increase of 132 basis points in the home lending gain on sale margin to 4.75% for the second quarter of 2020. Of the current quarter’s mortgage production, 34% related to purchase activity, compared to 43% for the prior quarter and 70% for the same period of the prior year.

Non-interest Expense

Non-interest expense was $181.9 million for the second quarter of 2020, down $1.8 billion from the prior quarter level. This decrease was driven primarily by the $1.8 billion goodwill impairment that was recorded in the prior period.  Due to the aforementioned strong mortgage production, expenses for our Home Lending Division were up $10.4 million compared to the prior quarter.

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 June 30, 2020, the Company’s tangible book value per common share1 was $11.44, compared to $11.30 in the prior quarter and $10.97 in the same period of the prior year.

The Company’s estimated total risk-based capital ratio was 14.4% and its estimated Tier 1 common to risk weighted assets ratio was 11.1% as of June 30, 2020.  The Company remains above current “well-capitalized” regulatory minimums.  The regulatory capital ratios as of June 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)


Jun 30, 2020


Mar 31, 2020


Dec 31, 2019


Sep 30, 2019


Jun 30, 2019

Total shareholders’ equity


$

2,538,339



$

2,507,611



$

4,313,915



$

4,289,516



$

4,228,507


Subtract:











Goodwill


2,715



2,715



1,787,651



1,787,651



1,787,651


Other intangible assets, net


15,853



17,099



18,346



19,750



21,155


Tangible common shareholders’ equity


$

2,519,771



$

2,487,797



$

2,507,918



$

2,482,115



$

2,419,701


Total assets


$

29,645,248



$

27,540,382



$

28,846,809



$

28,930,855



$

27,986,075


Subtract:











Goodwill


2,715



2,715



1,787,651



1,787,651



1,787,651


Other intangible assets, net


15,853



17,099



18,346



19,750



21,155


Tangible assets


$

29,626,680



$

27,520,568



$

27,040,812



$

27,123,454



$

26,177,269


Common shares outstanding at period end


220,219



220,175



220,229



220,212



220,499













Total shareholders’ equity to total assets ratio


8.56

%


9.11

%


14.95

%


14.83

%


15.11

%

Tangible common equity ratio


8.51

%


9.04

%


9.27

%


9.15

%


9.24

%

Book value per common share


$

11.53



$

11.39



$

19.59



$

19.48



$

19.18


Tangible book value per common share


$

11.44



$

11.30



$

11.39



$

11.27



$

10.97


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 second quarter 2020 earnings conference call on July 23, 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 second 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: 8066667.  A re-broadcast will be available approximately two hours after the call by dialing (855) 859-2056 and entering conference ID 8066667. 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 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)

Jun 30,

2020


Mar 31,

2020


Dec 31,

2019


Sep 30,

2019


Jun 30,

2019


Seq.

Quarter


Year

over

Year

Interest income:














Loans and leases

$

235,174



$

245,993



$

262,109



$

266,111



$

264,110



(4)

%


(11)

%

Interest and dividends on investments:














Taxable

9,015



16,605



13,361



12,546



10,287



(46)

%


(12)

%

Exempt from federal income tax

1,520



1,562



1,638



1,727



1,921



(3)

%


(21)

%

Dividends

568



678



579



599



574



(16)

%


(1)

%

Temporary investments and interest bearing deposits

403



3,331



4,343



4,204



4,708



(88)

%


(91)

%

Total interest income

246,680



268,169



282,030



285,187



281,600



(8)

%


(12)

%

Interest expense:














Deposits

26,222



40,290



44,380



45,876



43,591



(35)

%


(40)

%

Securities sold under agreement to repurchase and federal funds purchased

194



395



431



448



403



(51)

%


(52)

%

Borrowings

3,839



4,046



5,080



4,238



4,563



(5)

%


(16)

%

Junior subordinated debentures

3,922



4,903



5,325



5,652



5,881



(20)

%


(33)

%

Total interest expense

34,177



49,634



55,216



56,214



54,438



(31)

%


(37)

%

Net interest income

212,503



218,535



226,814



228,973



227,162



(3)

%


(6)

%

Provision for credit losses

87,085



118,085



16,252



23,227



19,352



(26)

%


350

%

Non-interest income:














Service charges on deposits

11,831



15,638



16,656



16,627



15,953



(24)

%


(26)

%

Brokerage revenue

3,805



4,015



4,027



4,060



3,980



(5)

%


(4)

%

Residential mortgage banking revenue, net

83,877



17,540



34,050



47,000



9,529



378

%


780

%

Gain (loss) on sale of debt securities, net

323



(133)



2





(7,186)



(343)

%


(104)

%

Gain (loss) on equity securities, net

240



814



(84)



257



82,607



(71)

%


(100)

%

Gain on loan and lease sales, net

1,074



1,167



4,603



1,762



3,333



(8)

%


(68)

%

BOLI income

2,116



2,129



2,078



2,067



2,093



(1)

%


1

%

Other income (expense)

12,214



(525)



22,417



16,739



11,514



nm


6

%

Total non-interest income

115,480



40,645



83,749



88,512



121,823



184

%


(5)

%

Non-interest expense:














Salaries and employee benefits

116,676



109,774



108,847



106,819



104,049



6

%


12

%

Occupancy and equipment, net

36,171



37,001



36,513



35,446



36,032



(2)

%


0

%

Intangible amortization

1,246



1,247



1,404



1,405



1,405



0

%


(11)

%

FDIC assessments

3,971



2,542



2,867



2,587



2,837



56

%


40

%

Goodwill impairment



1,784,936









(100)

%


nm

Other expenses

23,846



27,158



33,812



37,333



36,092



(12)

%


(34)

%

Total non-interest expense

181,910



1,962,658



183,443



183,590



180,415



(91)

%


1

%

Income (loss) before provision for income taxes

58,988



(1,821,563)



110,868



110,668



149,218



(103)

%


(60)

%

Provision for income taxes

6,062



30,384



27,118



26,166



37,408



(80)

%


(84)

%

Net income (loss)

$

52,926



$

(1,851,947)



$

83,750



$

84,502



$

111,810



(103)

%


(53)

%















Weighted average basic shares outstanding

220,210



220,216



220,222



220,285



220,487



0

%


0

%

Weighted average diluted shares outstanding

220,320



220,216



220,671



220,583



220,719



0

%


0

%

Earnings (loss) per common share – basic

$

0.24



$

(8.41)



$

0.38



$

0.38



$

0.51



(103)

%


(53)

%

Earnings (loss) per common share – diluted

$

0.24



$

(8.41)



$

0.38



$

0.38



$

0.51



(103)

%


(53)

%















nm = not meaningful









 

Umpqua Holdings Corporation

Consolidated Statements of Income

(Unaudited)



Six Months Ended


% Change

(In thousands, except per share data)


Jun 30, 2020


Jun 30, 2019


Year

over 

Year

Interest income:







Loans and leases


$

481,167



$

522,857



(8)

%

Interest and dividends on investments:







Taxable


25,620



30,243



(15)

%

Exempt from federal income tax


3,082



4,035



(24)

%

Dividends


1,246



1,091



14

%

Temporary investments and interest bearing deposits


3,734



5,633



(34)

%

Total interest income


514,849



563,859



(9)

%

Interest expense:







Deposits


66,512



77,685



(14)

%

Securities sold under agreement to repurchase and federal funds purchased


589



1,213



(51)

%

Borrowings


7,885



8,246



(4)

%

Junior subordinated debentures


8,825



11,868



(26)

%

Total interest expense


83,811



99,012



(15)

%

Net interest income


431,038



464,847



(7)

%

Provision for credit losses


205,170



33,036



521

%

Non-interest income:







Service charges on deposits


27,469



31,231



(12)

%

Brokerage revenue


7,820



7,790



0

%

Residential mortgage banking revenue, net


101,417



20,760



389

%

Gain (loss) on sale of debt securities, net


190



(7,186)



(103)

%

Gain on equity securities, net


1,054



83,302



(99)

%

Gain on loan and lease sales, net


2,241



4,102



(45)

%

BOLI income


4,245



4,261



0

%

Other income


11,689



23,303



(50)

%

Total non-interest income


156,125



167,563



(7)

%

Non-interest expense:







Salaries and employee benefits


226,450



204,707



11

%

Occupancy and equipment, net


73,172



72,277



1

%

Intangible amortization


2,493



2,809



(11)

%

FDIC assessments


6,513



5,779



13

%

Goodwill impairment


1,784,936





nm


Other expenses


51,004



66,435



(23)

%

Total non-interest expense


2,144,568



352,007



509

%

(Loss) income before provision for income taxes


(1,762,575)



247,367



(813)

%

Provision for income taxes


36,446



61,524



(41)

%

Net (loss) income


$

(1,799,021)



$

185,843



(1,068)

%








Weighted average basic shares outstanding


220,213



220,427



0

%

Weighted average diluted shares outstanding


220,213



220,692



0

%

(Loss) earnings per common share – basic


$

(8.17)



$

0.84



(1,073)

%

(Loss) earnings per common share – diluted


$

(8.17)



$

0.84



(1,073)

%








nm = not meaningful








 

Umpqua Holdings Corporation

Consolidated Balance Sheets

(Unaudited)












% Change

(In thousands, except per share data)

Jun 30, 2020


Mar 31, 2020


Dec 31, 2019


Sep 30, 2019


Jun 30, 2019


Seq.

Quarter


Year

over

Year

Assets:














Cash and due from banks

$

410,769



$

406,426



$

382,598



$

433,620



$

342,508



1

%


20

%

Interest bearing cash and temporary investments

1,853,505



1,251,290



980,158



757,824



691,283



48

%


168

%

Investment securities:














Equity and other, at fair value

81,958



80,797



80,165



64,764



66,358



1

%


24

%

Available for sale, at fair value

2,865,690



2,890,475



2,814,682



2,842,076



2,698,398



(1)

%


6

%

Held to maturity, at amortized cost

3,143



3,200



3,260



3,320



3,416



(2)

%


(8)

%

Loans held for sale, at fair value

605,399



481,541



513,431



355,022



356,645



26

%


70

%

Loans and leases

22,671,455



21,251,478



21,195,684



21,520,794



20,953,371



7

%


8

%

Allowance for credit losses on loans and leases

(356,745)



(291,420)



(157,629)



(156,288)



(151,069)



22

%


136

%

Net loans and leases

22,314,710



20,960,058



21,038,055



21,364,506



20,802,302



6

%


7

%

Restricted equity securities

54,062



58,062



46,463



54,463



43,063



(7)

%


26

%

Premises and equipment, net

192,041



195,390



201,460



203,391



210,285



(2)

%


(9)

%

Operating lease right-of-use assets

111,487



115,485



110,718



108,187



112,752



(3)

%


(1)

%

Goodwill

2,715



2,715



1,787,651



1,787,651



1,787,651



0

%


(100)

%

Other intangible assets, net

15,853



17,099



18,346



19,750



21,155



(7)

%


(25)

%

Residential mortgage servicing rights, at fair value

96,356



94,346



115,010



151,383



139,780



2

%


(31)

%

Bank owned life insurance

324,873



322,717



320,611



318,533



316,435



1

%


3

%

Other assets

712,687



660,781



434,201



466,365



394,044



8

%


81

%

Total assets

$

29,645,248



$

27,540,382



$

28,846,809



$

28,930,855



$

27,986,075



8

%


6

%

Liabilities:














Deposits

$

24,844,378



$

22,699,375



$

22,481,504



$

22,434,734



$

21,819,013



9

%


14

%

Securities sold under agreements to repurchase

398,414



346,245



311,308



296,717



308,052



15

%


29

%

Borrowings

1,096,559



1,196,597



906,635



1,106,674



821,712



(8)

%


33

%

Junior subordinated debentures, at fair value

232,936



195,521



274,812



267,798



277,028



19

%


(16)

%

Junior subordinated debentures, at amortized cost

88,382



88,439



88,496



88,553



88,610



0

%


0

%

Operating lease liabilities

119,885



123,962



119,429



116,924



121,742



(3)

%


(2)

%

Deferred tax liability, net

21,439



51,061



52,928



67,055



57,757



(58)

%


(63)

%

Other liabilities

304,916



331,571



297,782



262,884



263,654



(8)

%


16

%

Total liabilities

27,106,909



25,032,771



24,532,894



24,641,339



23,757,568



8

%


14

%

Shareholders’ equity:














Common stock

3,510,145



3,507,680



3,514,000



3,511,493



3,514,391



0

%


0

%

(Accumulated deficit) retained earnings

(1,115,414)



(1,168,340)



770,366



733,059



695,003



(5)

%


(260)

%

Accumulated other comprehensive income

143,608



168,271



29,549



44,964



19,113



(15)

%


651

%

Total shareholders’ equity

2,538,339



2,507,611



4,313,915



4,289,516



4,228,507



1

%


(40)

%

Total liabilities and shareholders’ equity

$

29,645,248



$

27,540,382



$

28,846,809



$

28,930,855



$

27,986,075



8

%


6

%















Common shares outstanding at period end

220,219



220,175



220,229



220,212



220,499



0

%


0

%

Book value per common share

$

11.53



$

11.39



$

19.59



$

19.48



$

19.18



1

%


(40)

%

Tangible book value per common share

$

11.44



$

11.30



$

11.39



$

11.27



$

10.97



1

%


4

%

Tangible equity – common

$

2,519,771



$

2,487,797



$

2,507,918



$

2,482,115



$

2,419,701



1

%


4

%

Tangible common equity to tangible assets

8.51

%


9.04

%


9.27

%


9.15

%


9.24

%


(0.53)


(0.73)


 

Umpqua Holdings Corporation

Loan and Lease Portfolio

(Unaudited)


Jun 30, 2020


Mar 31, 2020


Dec 31, 2019


Sep 30, 2019


Jun 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

$

3,589,484



$

3,613,420



$

3,545,566



$

3,495,555



$

3,537,084



(1)

%


1

%

Owner occupied term, net

2,459,954



2,472,187



2,496,088



2,566,299



2,396,674



0

%


3

%

Multifamily, net

3,466,829



3,464,217



3,514,774



3,479,986



3,341,547



0

%


4

%

Construction & development, net

662,703



667,975



678,740



771,214



732,932



(1)

%


(10)

%

Residential development, net

164,180



187,594



189,010



191,500



199,421



(12)

%


(18)

%

Commercial:














Term, net (1)

4,265,092



2,317,573



2,232,817



2,310,759



2,271,346



84

%


88

%

Lines of credit & other, net

940,443



1,208,051



1,212,393



1,254,755



1,280,587



(22)

%


(27)

%

Leases & equipment finance, net

1,522,369



1,492,762



1,465,489



1,485,753



1,449,579



2

%


5

%

Residential:














Mortgage, net

4,056,588



4,193,908



4,215,424



4,245,674



3,995,643



(3)

%


2

%

Home equity loans & lines, net

1,189,428



1,249,152



1,237,512



1,224,578



1,215,215



(5)

%


(2)

%

   Consumer & other, net

354,385



384,639



407,871



494,721



533,343



(8)

%


(34)

%

Total loans, net of deferred fees and costs

$

22,671,455



$

21,251,478



$

21,195,684



$

21,520,794



$

20,953,371



7

%


8

%















(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 15,000 PPP loans, totaling $1.9 billion, net of deferred fees and costs.















Loan and leases mix:














Commercial real estate:














   Non-owner occupied term, net

16

%


17

%


17

%


16

%


17

%





   Owner occupied term, net

11

%


12

%


12

%


12

%


11

%





   Multifamily, net

15

%


16

%


16

%


16

%


16

%





Construction & development, net

3

%


3

%


3

%


4

%


3

%





Residential development, net

1

%


1

%


1

%


1

%


1

%





Commercial:














Term, net

19

%


11

%


10

%


11

%


11

%





Lines of credit & other, net

4

%


5

%


6

%


6

%


6

%





Leases & equipment finance, net

7

%


7

%


7

%


7

%


7

%





Residential:














Mortgage, net

18

%


20

%


20

%


20

%


19

%





Home equity loans & lines, net

5

%


6

%


6

%


5

%


6

%





   Consumer & other, net

1

%


2

%


2

%


2

%


3

%





Total

100

%


100

%


100

%


100

%


100

%






 

Umpqua Holdings Corporation

Deposits by Type/Core Deposits

(Unaudited)


Jun 30, 2020


Mar 31, 2020


Dec 31, 2019


Sep 30, 2019


Jun 30, 2019


% Change

 (Dollars in thousands)

Amount


Amount


Amount


Amount


Amount


Seq.

Quarter


Year

over

Year

Deposits:














Demand, non-interest bearing

$

9,172,210



$

7,169,907



$

6,913,375



$

7,123,180



$

6,771,087



28

%


35

%

Demand, interest bearing

2,813,722



2,482,908



2,524,534



2,406,404



2,355,473



13

%


19

%

Money market

7,262,777



7,082,011



6,930,815



6,646,383



6,789,036



3

%


7

%

Savings

1,730,051



1,486,909



1,471,475



1,469,302



1,446,332



16

%


20

%

Time

3,865,618



4,477,640



4,641,305



4,789,465



4,457,085



(14)

%


(13)

%

Total

$

24,844,378



$

22,699,375



$

22,481,504



$

22,434,734



$

21,819,013



9

%


14

%















Total core deposits (1)

$

22,095,314



$

19,434,228



$

19,061,058



$

18,845,328



$

18,529,797



14

%


19

%















Deposit mix:














Demand, non-interest bearing

37

%


32

%


31

%


32

%


31

%





Demand, interest bearing

11

%


11

%


11

%


11

%


11

%





Money market

29

%


31

%


31

%


30

%


31

%





Savings

7

%


7

%


6

%


6

%


7

%





Time

16

%


19

%


21

%


21

%


20

%





Total

100

%


100

%


100

%


100

%


100

%



















Number of open accounts:














Demand, non-interest bearing

423,456



416,270



415,254



413,633



409,235






Demand, interest bearing

74,813



75,514



75,900



76,390



76,686






Money market

59,445



59,203



58,888



58,796



58,158






Savings

161,710



159,870



159,948



160,673



160,708






Time

57,501



62,515



62,952



62,122



60,571






Total

776,925



773,372



772,942



771,614



765,358




















Average balance per account:














Demand, non-interest bearing

$

21.7



$

17.2



$

16.6



$

17.2



$

16.5






Demand, interest bearing

37.6



32.9



33.3



31.5



30.7






Money market

122.2



119.6



117.7



113.0



116.7






Savings

10.7



9.3



9.2



9.1



9.0






Time

67.2



71.6



73.7



77.1



73.6






Total

$

32.0



$

29.4



$

29.1



$

29.1



$

28.5







(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)


Jun 30, 2020


Mar 31, 2020


Dec 31, 2019


Sep 30, 2019


Jun 30, 2019


Seq.

Quarter


Year

over

Year

Non-performing assets:















Loans and leases on non-accrual status


$

32,412



$

39,128



$

26,244



$

31,636



$

35,022



(17)

%


(7)

%

Loans and leases past due 90+ days and accruing (1)


42,273



47,185



37,969



35,745



35,700



(10)

%


18

%

Total non-performing loans and leases


74,685



86,313



64,213



67,381



70,722



(13)

%


6

%

Other real estate owned


2,578



3,020



3,295



4,026



8,423



(15)

%


(69)

%

Total non-performing assets


$

77,263



$

89,333



$

67,508



$

71,407



$

79,145



(14)

%


(2)

%
















Performing restructured loans and leases


$

15,032



$

20,541



$

18,576



$

14,309



$

15,267



(27)

%


(2)

%

Loans and leases past due 31-89 days


$

41,683



$

59,962



$

41,882



$

44,390



$

40,619



(30)

%


3

%

Loans and leases past due 31-89 days to total loans and leases


0.18

%


0.28

%


0.20

%


0.21

%


0.19

%





Non-performing loans and leases to total loans and leases (1)


0.33

%


0.41

%


0.30

%


0.31

%


0.34

%





Non-performing assets to total assets(1)


0.26

%


0.32

%


0.23

%


0.25

%


0.28

%







(1)

Excludes non-performing mortgage loans guaranteed by Ginnie Mae, which Umpqua has the unilateral right to repurchase but has not done so, totaling $2.6 million, $5.3 million, $4.3 million, $5.2 million, and $5.4 million at June 30, 2020, March 31, 2020, December 31, 2019, September 30, 2019, and June 30, 2019, respectively.


 

Umpqua Holdings Corporation

Credit Quality – Allowance for Credit Losses

(Unaudited)



Three Month Ended


% Change

(Dollars in thousands)


Jun 30,

2020


Mar 31,

2020


Dec 31,

2019


Sep 30,

2019


Jun 30,

2019


Seq.

Quarter


Year

over

Year

Allowance for credit losses on loans and leases (ACLLL)















Balance, beginning of period


$

291,420



$

157,629



$

156,288



$

151,069



$

144,872



85

%


101

%

Impact of adoption of CECL




49,999









(100)

%


nm

Adjusted balance, beginning of period


291,420



207,628



156,288



151,069



144,872



40

%


101

%

Provision for credit losses on loans and leases (1)


81,484



105,502



16,252



23,227



19,352



(23)

%


321

%

Charge-offs


(19,453)



(24,455)



(18,734)



(23,112)



(16,707)



(20)

%


16

%

Recoveries


3,294



2,745



3,823



5,104



3,552



20

%


(7)

%

Net charge-offs


(16,159)



(21,710)



(14,911)



(18,008)



(13,155)



(26)

%


23

%

 Balance, end of period


$

356,745



$

291,420



$

157,629



$

156,288



$

151,069



22

%


136

%

Reserve for unfunded commitments















Balance, beginning of period


$

20,927



$

5,106



$

5,085



$

4,857



$

4,654



310

%


350

%

Impact of adoption of CECL




3,238









(100)

%


nm

Adjusted balance, beginning of period


20,927



8,344



5,085



4,857



4,654



151

%


350

%

Provision for credit losses on unfunded commitments (1)


5,441



12,583



21



228



203



(57)

%


nm

Balance, end of period


$

26,368



$

20,927



$

5,106



$

5,085



$

4,857



26

%


443

%

Total Allowance for credit losses (ACL)


$

383,113



$

312,347



$

162,735



$

161,373



$

155,926



23

%


146

%
















Net charge-offs to average loans and leases (annualized)


0.29

%


0.41

%


0.28

%


0.34

%


0.26

%





Recoveries to gross charge-offs


16.93

%


11.22

%


20.41

%


22.08

%


21.26

%





ACLLL to loans and leases


1.57

%


1.37

%


0.74

%


0.73

%


0.72

%





ACL to loans and leases


1.69

%


1.47

%


0.77

%


0.75

%


0.74

%





nm = not meaningful













(1) The total provision for credit losses as disclosed on the income statement includes an additional $160,000 in provision related to accrued interest on loans deferred due to COVID-19, which is not included in the table above.

 

Umpqua Holdings Corporation

Credit Quality – Allowance for Credit Losses

(Unaudited)



Six Months Ended


% Change

(Dollars in thousands)


Jun 30, 2020


Jun 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)


186,986



33,036



466

%

Charge-offs


(43,908)



(33,859)



30

%

Recoveries


6,039



7,021



(14)

%

Net charge-offs


(37,869)



(26,838)



41

%

Balance, end of period


$

356,745



$

151,069



136

%

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)


18,024



334



nm


Balance, end of period


$

26,368



$

4,857



443

%

Total Allowance for credit losses (ACL)


$

383,113



$

155,926



146

%








Net charge-offs to average loans and leases (annualized)


0.35

%


0.26

%



Recoveries to gross charge-offs


13.75

%


20.74

%



nm = not meaningful








(1) The total provision for credit losses as disclosed on the income statement includes an additional $160,000 in 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



Jun 30,

2020


Mar 31,

2020


Dec 31,

2019


Sep 30,

2019


Jun 30,

2019


Seq.

Quarter


Year

over

Year

Average Rates:















Yield on loans held for sale


3.77

%


4.20

%


4.25

%


4.82

%


5.03

%


(0.43)



(1.26)


Yield on loans and leases


4.11

%


4.58

%


4.80

%


4.93

%


5.07

%


(0.47)



(0.96)


Yield on taxable investments


1.38

%


2.50

%


2.05

%


1.99

%


1.62

%


(1.12)



(0.24)


Yield on tax-exempt investments (1)


3.17

%


3.14

%


3.23

%


3.30

%


3.42

%


0.03



(0.25)


Yield on interest bearing cash and temporary investments


0.10

%


1.23

%


1.65

%


2.20

%


2.41

%


(1.13)



(2.31)


Total yield on earning assets (1)


3.59

%


4.19

%


4.36

%


4.52

%


4.59

%


(0.60)



(1.00)

















Cost of interest bearing deposits


0.67

%


1.03

%


1.13

%


1.19

%


1.16

%


(0.36)



(0.49)


Cost of securities sold under agreements















to repurchase and fed funds purchased


0.21

%


0.47

%


0.56

%


0.57

%


0.55

%


(0.26)



(0.34)


Cost of borrowings


1.33

%


1.79

%


1.96

%


1.95

%


2.03

%


(0.46)



(0.70)


Cost of junior subordinated debentures


5.55

%


5.45

%


5.92

%


6.14

%


6.17

%


0.10



(0.62)


Total cost of interest bearing liabilities


0.78

%


1.15

%


1.27

%


1.33

%


1.31

%


(0.37)



(0.53)

















Net interest spread (1)


2.81

%


3.04

%


3.09

%


3.19

%


3.28

%


(0.23)



(0.47)


Net interest margin (1)


3.09

%


3.41

%


3.51

%


3.63

%


3.70

%


(0.32)



(0.61)

















Performance Ratios:















Return on average assets


0.73

%


(25.82)

%


1.15

%


1.18

%


1.62

%


26.55



(0.89)


Return on average tangible assets


0.73

%


(27.53)

%


1.22

%


1.26

%


1.73

%


28.26



(1.00)


Return on average common equity


8.46

%


(174.94)

%


7.70

%


7.87

%


10.80

%


183.40



(2.34)


Return on average tangible common equity


8.53

%


(301.30)

%


13.24

%


13.67

%


19.14

%


309.83



(10.61)


Efficiency ratio – Consolidated


55.40

%


756.29

%


59.00

%


57.76

%


51.64

%


(700.89)



3.76


Efficiency ratio – Bank


54.17

%


752.92

%


57.56

%


56.22

%


50.16

%


(698.75)



4.01



(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, 2020


Jun 30, 2019


Year over Year

Average Rates:







Yield on loans held for sale


3.94

%


5.41

%


(1.47)


Yield on loans and leases


4.33

%


5.07

%


(0.74)


Yield on taxable investments


1.94

%


2.30

%


(0.36)


Yield on tax-exempt investments (1)


3.15

%


3.51

%


(0.36)


Yield on interest bearing cash and temporary investments


0.56

%


2.42

%


(1.86)


Total yield on earning assets (1)


3.88

%


4.69

%


(0.81)









Cost of interest bearing deposits


0.85

%


1.07

%


(0.22)


Cost of securities sold under agreements







to repurchase and fed funds purchased


0.33

%


0.74

%


(0.41)


Cost of borrowings


1.53

%


1.96

%


(0.43)


Cost of junior subordinated debentures


5.49

%


6.20

%


(0.71)


Total cost of interest bearing liabilities


0.96

%


1.23

%


(0.27)









Net interest spread (1)


2.92

%


3.46

%


(0.54)


Net interest margin (1)


3.25

%


3.86

%


(0.61)









Performance Ratios:







Return on average assets


(12.49)

%


1.37

%


(13.86)


Return on average tangible assets


(12.89)

%


1.47

%


(14.36)


Return on average common equity


(106.99)

%


9.09

%


(116.08)


Return on average tangible common equity


(145.65)

%


16.21

%


(161.86)


Efficiency ratio – Consolidated


364.82

%


55.58

%


309.24


Efficiency ratio – Bank


363.13

%


53.94

%


309.19










(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,

2020


Mar 31,

2020


Dec 31,

2019


Sep 30,

2019


Jun 30,

2019


Seq.

Quarter


Year

over

Year

Temporary investments and interest bearing cash

$

1,563,753



$

1,084,854



$

1,045,975



$

759,416



$

783,703



44

%


100

%

Investment securities, taxable

2,777,154



2,760,461



2,719,089



2,648,092



2,683,472



1

%


3

%

Investment securities, tax-exempt

235,934



241,105



244,895



252,765



271,633



(2)

%


(13)

%

Loans held for sale

577,773



406,434



415,169



328,155



264,445



42

%


118

%

Loans and leases

22,428,142



21,196,989



21,379,239



21,170,915



20,605,963



6

%


9

%

Total interest earning assets

27,582,756



25,689,843



25,804,367



25,159,343



24,609,216



7

%


12

%

Goodwill and other intangible assets, net

19,253



1,785,608



1,806,791



1,808,191



1,809,583



(99)

%


(99)

%

Total assets

29,066,775



28,844,773



28,981,387



28,356,982



27,709,310



1

%


5

%















Non-interest bearing demand deposits

8,484,684



6,880,457



7,037,320



6,880,093



6,556,090



23

%


29

%

Interest bearing deposits

15,803,595



15,695,309



15,550,483



15,289,464



15,069,198



1

%


5

%

Total deposits

24,288,279



22,575,766



22,587,803



22,169,557



21,625,288



8

%


12

%

Interest bearing liabilities

17,625,888



17,301,712



17,237,770



16,827,917



16,646,949



2

%


6

%















Shareholders’ equity – common

2,514,754



4,257,711



4,317,277



4,260,810



4,153,175



(41)

%


(39)

%

Tangible common equity (1)

2,495,501



2,472,103



2,510,486



2,452,619



2,343,592



1

%


6

%

 

Umpqua Holdings Corporation

Average Balances

(Unaudited)



Six Months Ended

% Change

(Dollars in thousands)


Jun 30, 2020


Jun 30, 2019


Year over Year

Temporary investments and interest bearing cash


$

1,325,627



$

470,266



182

%

Investment securities, taxable


2,768,853



2,720,353



2

%

Investment securities, tax-exempt


238,505



279,456



(15)

%

Loans held for sale


492,577



226,263



118

%

Loans and leases


21,815,966



20,498,075



6

%

Total interest earning assets


26,641,528



24,194,413



10

%

Goodwill and other intangible assets, net


897,551



1,810,291



(50)

%

Total assets


28,956,388



27,262,945



6

%








Non-interest bearing demand deposits


7,687,002



6,530,992



18

%

Interest bearing deposits


15,749,751



14,688,875



7

%

Total deposits


23,436,753



21,219,867



10

%

Interest bearing liabilities


17,464,696



16,254,933



7

%








Shareholders’ equity – common


3,381,417



4,122,346



(18)

%

Tangible common equity (1)


2,483,866



2,312,055



7

%









(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, 2020


March 31, 2020


June 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

$

577,773



$

5,443



3.77

%


$

406,434



$

4,264



4.20

%


$

264,445



$

3,326



5.03

%

Loans and leases (1)

22,428,142



229,731



4.11

%


21,196,989



241,729



4.58

%


20,605,963



260,784



5.07

%

Taxable securities

2,777,154



9,583



1.38

%


2,760,461



17,283



2.50

%


2,683,472



10,861



1.62

%

Non-taxable securities (2)

235,934



1,868



3.17

%


241,105



1,894



3.14

%


271,633



2,325



3.42

%

Temporary investments and interest-bearing cash

1,563,753



403



0.10

%


1,084,854



3,331



1.23

%


783,703



4,708



2.41

%

Total interest-earning assets

27,582,756



$

247,028



3.59

%


25,689,843



$

268,501



4.19

%


24,609,216



$

282,004



4.59

%

Other assets

1,484,019







3,154,930







3,100,094






Total assets

$

29,066,775







$

28,844,773







$

27,709,310






INTEREST-BEARING LIABILITIES:


















Interest-bearing demand deposits

$

2,649,331



$

1,148



0.17

%


$

2,471,556



$

3,543



0.58

%


$

2,332,535



$

2,798



0.48

%

Money market deposits

7,275,041



4,037



0.22

%


7,107,626



11,759



0.66

%


6,747,290



15,351



0.91

%

Savings deposits

1,628,276



198



0.05

%


1,485,171



241



0.07

%


1,454,908



410



0.11

%

Time deposits

4,250,947



20,839



1.97

%


4,630,956



24,747



2.15

%


4,534,465



25,032



2.21

%

Total interest-bearing deposits

15,803,595



26,222



0.67

%


15,695,309



40,290



1.03

%


15,069,198



43,591



1.16

%

Repurchase agreements and federal funds purchased

375,098



194



0.21

%


337,796



395



0.47

%


292,057



403



0.55

%

Borrowings

1,163,065



3,839



1.33

%


906,624



4,046



1.79

%


903,164



4,563



2.03

%

Junior subordinated debentures

284,130



3,922



5.55

%


361,983



4,903



5.45

%


382,530



5,881



6.17

%

Total interest-bearing liabilities

17,625,888



$

34,177



0.78

%


17,301,712



$

49,634



1.15

%


16,646,949



$

54,438



1.31

%

Non-interest-bearing deposits

8,484,684







6,880,457







6,556,090






Other liabilities

441,449







404,893







353,096






Total liabilities

26,552,021







24,587,062







23,556,135






Common equity

2,514,754







4,257,711







4,153,175






Total liabilities and shareholders’ equity

$

29,066,775







$

28,844,773







$

27,709,310






NET INTEREST INCOME



$

212,851







$

218,867







$

227,566




NET INTEREST SPREAD





2.81

%






3.04

%






3.28

%

NET INTEREST INCOME TO EARNING ASSETS OR NET INTEREST MARGIN (1), (2)





3.09

%






3.41

%






3.70

%



(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 $348,000 for the three months ended June 30, 2020, as compared to $332,000 for March 31, 2020 and $404,000 for June 30, 2019. 


 

Umpqua Holdings Corporation

Average Rates and Balances

(Unaudited)

(dollars in thousands)

Six Months Ended


June 30, 2020


June 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

$

492,577



$

9,707



3.94

%


$

226,263



$

6,116



5.41

%

Loans and leases (1)

21,815,966



471,460



4.33

%


20,498,075



516,741



5.07

%

Taxable securities

2,768,853



26,866



1.94

%


2,720,353



31,334



2.30

%

Non-taxable securities (2)

238,505



3,763



3.15

%


279,456



4,905



3.51

%

Temporary investments and interest-bearing cash

1,325,627



3,734



0.56

%


470,266



5,633



2.42

%

Total interest-earning assets

26,641,528



$

515,530



3.88

%


24,194,413



$

564,729



4.69

%

Other assets

2,314,860







3,068,532






Total assets

$

28,956,388







$

27,262,945






INTEREST-BEARING LIABILITIES:












Interest-bearing demand deposits

$

2,560,935



$

4,691



0.37

%


$

2,326,162



$

5,438



0.47

%

Money market deposits

7,191,796



15,796



0.44

%


6,570,488



26,368



0.81

%

Savings deposits

1,557,118



439



0.06

%


1,471,626



680



0.09

%

Time deposits

4,439,902



45,586



2.06

%


4,320,599



45,199



2.11

%

Total interest-bearing deposits

15,749,751



66,512



0.85

%


14,688,875



77,685



1.07

%

Repurchase agreements and federal funds purchased

356,550



589



0.33

%


331,477



1,213



0.74

%

Borrowings

1,035,553



7,885



1.53

%


848,783



8,246



1.96

%

Junior subordinated debentures

322,842



8,825



5.49

%


385,798



11,868



6.20

%

Total interest-bearing liabilities

17,464,696



$

83,811



0.96

%


16,254,933



$

99,012



1.23

%

Non-interest-bearing deposits

7,687,002







6,530,992






Other liabilities

423,273







354,674






Total liabilities

25,574,971







23,140,599






Common equity

3,381,417







4,122,346






Total liabilities and shareholders’ equity

$

28,956,388







$

27,262,945






NET INTEREST INCOME



$

431,719







$

465,717




NET INTEREST SPREAD





2.92

%






3.46

%

NET INTEREST INCOME TO EARNING ASSETS OR NET INTEREST MARGIN (1), (2)





3.25

%






3.86

%















(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 $681,000 for the six months ended June 30, 2020 as compared to $870,000 for the same period in 2019. 

 

Umpqua Holdings Corporation

Residential Mortgage Banking Activity

(Unaudited)


Quarter Ended


% Change

(Dollars in thousands)

Jun 30, 2020


Mar 31, 2020


Dec 31, 2019


Sep 30, 2019


Jun 30, 2019


Seq.

 Quarter


Year

over Year

Residential mortgage banking revenue:














Origination and sale

$

86,781



$

39,347



$

35,438



$

31,432



$

23,151



121

%


275

%

Servicing

8,533



8,880



8,981



11,358



11,036



(4)

%


(23)

%

Change in fair value of MSR asset:














Changes due to collection/realization of expected cash flows over time

(5,042)



(5,329)



(5,237)



(6,835)



(6,905)



(5)

%


(27)

%

Changes due to valuation inputs or assumptions

(6,395)



(25,358)



(5,132)



11,045



(17,753)



(75)

%


(64)

%

Total

$

83,877



$

17,540



$

34,050



$

47,000



$

9,529



378

%


780

%















Closed loan volume:














Portfolio

$

276,247



$

252,329



$

335,511



$

611,022



$

481,878



9

%


(43)

%

For-sale

1,826,095



1,148,184



1,060,016



844,442



698,150



59

%


162

%

Total

$

2,102,342



$

1,400,513



$

1,395,527



$

1,455,464



$

1,180,028



50

%


78

%















Gain on sale margin:














Based on for-sale volume

4.75

%


3.43

%


3.34

%


3.72

%


3.32

%


1.32



1.43
















Residential mortgage servicing rights:














Balance, beginning of period

$

94,346



$

115,010



$

151,383



$

139,780



$

158,946



(18)

%


(41)

%

Additions for new MSR capitalized

13,447



10,023



8,397



7,393



5,492



34

%


145

%

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

(5,042)



(5,329)



(5,237)



(6,835)



(6,905)



(5)

%


(27)

%

Changes due to valuation inputs or assumptions

(6,395)



(25,358)



(5,132)



11,045



(17,753)



(75)

%


(64)

%

Balance, end of period

$

96,356



$

94,346



$

115,010



$

151,383



$

139,780



2

%


(31)

%















Residential mortgage loans serviced for others

$

12,746,125



$

12,533,045



$

12,276,943



$

15,707,519



$

15,796,102



2

%


(19)

%

MSR as % of serviced portfolio

0.76

%


0.75

%


0.94

%


0.96

%


0.88

%


0.01



(0.12)



 

Umpqua Holdings Corporation

Residential Mortgage Banking Activity

(Unaudited)


Six Months Ended


% Change

(Dollars in thousands)

Jun 30, 2020


Jun 30, 2019


Year over Year

Residential mortgage banking revenue:






Origination and sale

$

126,128



$

37,524



236

%

Servicing

17,413



21,860



(20)

%

Change in fair value of MSR asset:






Changes due to collection/realization of expected cash flows over time

(10,371)



(13,336)



(22)

%

Changes due to valuation inputs or assumptions

(31,753)



(25,288)



26

%

Total

$

101,417



$

20,760



389

%







Closed loan volume:






Portfolio

$

528,576



$

800,490



(34)

%

For-sale

2,974,279



1,185,240



151

%

Total

$

3,502,855



$

1,985,730



76

%







Gain on sale margin:






Based on for-sale volume

4.24

%


3.17

%


1.07








Residential mortgage servicing rights:






Balance, beginning of period

$

115,010



$

169,025



(32)

%

Additions for new MSR capitalized

23,470



9,379



150

%

Changes in fair value of MSR asset:






Changes due to collection/realization of expected cash flows over time

(10,371)



(13,336)



(22)

%

Changes due to valuation inputs or assumptions

(31,753)



(25,288)



26

%

Balance, end of period

$

96,356



$

139,780



(31)

%







 

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SOURCE Umpqua Holdings Corporation