• United Community Banks, Inc. Reports Third Quarter Results

    Source: Nasdaq GlobeNewswire / 18 Oct 2022 16:30:01   America/New_York

    GREENVILLE, S.C., Oct. 18, 2022 (GLOBE NEWSWIRE) -- United Community Banks, Inc. (NASDAQ: UCBI) (United) announced today that net income for the third quarter was $81.2 million with pre-tax, pre-provision income of $118.9 million. Diluted earnings per share was $0.74 for the quarter, which represented an increase of $0.13 or 21% from the second quarter of 2022, and a decrease of $0.08 or 10% from the third quarter a year ago. The year-over-year decrease is largely attributable to an $11.0 million provision release in the third quarter of 2021 compared to a $15.4 million provision expense in this quarter. Other highlights of the quarter include 9.4% annualized loan growth, 38 basis points of net interest margin expansion, a reserve build to 1.12% of loans and an improvement in the efficiency ratio to 48.4%, or 47.7% on an operating basis, which excludes the effect of merger-related and other charges.

    United’s third-quarter return on assets (ROA) was 1.32%, and return on common equity was 11.02%. On an operating basis, United’s ROA was 1.34%, and its return on tangible common equity was 15.60%. Also, on an operating basis, United’s pre-tax, pre-provision ROA was 1.97% for the quarter.

    Total loans increased by $341 million during the quarter, resulting in loan growth of 9.4% on an annualized basis. Deposits decreased by $552 million or 11% annualized. A large portion of this decrease was driven by a seasonal decrease in public deposits, which were down by $278 million. United’s cost of deposits increased 11 basis points from the second quarter to 0.19% while the average yield on interest-earning assets was up 49 basis points to 3.83%.

    Chairman and CEO Lynn Harton stated, “This was a great quarter on multiple fronts for United as our businesses and our markets continue to provide solid growth opportunities. Loan growth and an expanding net interest margin propelled our pre-tax, pre-provision ROA and our efficiency ratio to record levels for the company. Deposits fell as anticipated due to higher-yielding market alternatives provided by increasing interest rates, however our core deposit base continues to provide strong liquidity for the company.”

    Harton continued, “From a strategic perspective, we continued to strengthen our Board of Directors with the appointment of George Bell, an experienced information technology executive who has more than 35 years in large financial institutions, with a specific emphasis on Customer Information Management. He brings an incredible depth of knowledge in leveraging technology to improve products and services, enhancing customer experience, and increasing organizational productivity. We are excited to have George join United as we continue to grow and expand our capabilities.”

    Harton concluded, “Finally, our thoughts are with the people, communities and businesses in Florida who are recovering from the devastating impact of Hurricane Ian. We are fortunate to report that United sustained no loss of life or property.”

    Third Quarter 2022 Financial Highlights:

    • Net income of $81.2 million and pre-tax, pre-provision income of $118.9 million
    • EPS decreased by 10% compared to third quarter 2021 on a GAAP basis and on an operating basis; compared to second quarter of 2022, EPS increased by 21% on a GAAP basis and increased 14% on an operating basis
    • Return on assets of 1.32%, or 1.34% on an operating basis
    • Pre-tax, pre-provision return on assets of 1.94%, or 1.97% on an operating basis
    • Return on common equity of 11.02%
    • Return on tangible common equity of 15.60% on an operating basis
    • A provision for credit losses of $15.4 million, which increased the allowance for loan losses to 1.12% of loans from 1.05% in the second quarter
    • Loan production of $1.6 billion, resulting in loan growth of 9.4% annualized for the quarter
    • Core transaction deposits were down $225 million, which represents a decline of 5% annualized for the quarter
    • Net interest margin of 3.57% was up 38 basis points from the second quarter, due to the effect of higher interest rates
    • Mortgage closings were $317 million compared to $568 million a year ago; mortgage rate locks were $456 million compared to $731 million a year ago
    • Noninterest income was down $1.5 million on a linked quarter basis, primarily driven by lower lock volume driven by higher interest rates
    • Noninterest expenses decreased by $8.0 million compared to the second quarter on a GAAP basis and by $2.6 million on an operating basis, primarily driven by lower merger-related charges as the second quarter included costs for the Reliant systems conversion
    • Efficiency ratio improved to historically low levels of 48.4%, or 47.7% on an operating basis
    • Net charge-offs were $1.1 million or 3 basis points as a percent of average loans, up 6 basis points from the net recoveries experienced in the second quarter
    • Nonperforming assets were 0.15% of total assets, an increase of 1 basis point compared to June 30, 2022
    • Quarterly common shareholder dividend was $0.22 per share declared during the quarter, an increase of 10% year-over-year

    Conference Call

    United will hold a conference call on Wednesday, October 19, 2022, at 11:00 am EST to discuss the contents of this press release and to share business highlights for the quarter. Participants can pre-register for the conference call by navigating to https://dpregister.com/sreg/10171644/f49bf32028. Those without internet access or unable to pre-register may dial in by calling 1-866-777-2509. Participants are encouraged to dial in 15 minutes prior to the call start time. The conference call also will be webcast and can be accessed by selecting “Events and Presentations” under “News and Events” within the Investor Relations section of the company's website, www.ucbi.com.

    UNITED COMMUNITY BANKS, INC.
    Selected Financial Information
    (in thousands, except per share data)
       2022   2021  Third Quarter
    2022 - 2021
    Change
     For the Nine Months Ended September 30, YTD 2022 - 2021 Change
      Third
    Quarter
     Second Quarter First
    Quarter
     Fourth Quarter Third
    Quarter
       2022   2021  
    INCOME SUMMARY                  
    Interest revenue $213,887  $187,378  $171,059  $143,768  $147,675    $572,324  $435,026   
    Interest expense  14,113   8,475   7,267   6,213   6,636     29,855   23,547   
    Net interest revenue  199,774   178,903   163,792   137,555   141,039  42%  542,469   411,479  32%
    Provision for (release of) credit losses  15,392   5,604   23,086   (647)  (11,034)    44,082   (36,903)  
    Noninterest income  31,922   33,458   38,973   37,177   40,095  (20)  104,353   120,641  (14)
    Total revenue  216,304   206,757   179,679   175,379   192,168  13   602,740   569,023  6 
    Noninterest expenses  112,755   120,790   119,275   109,156   96,749  17   352,820   287,483  23 
    Income before income tax expense  103,549   85,967   60,404   66,223   95,419  9   249,920   281,540  (11)
    Income tax expense  22,388   19,125   12,385   14,204   21,603  4   53,898   63,758  (15)
    Net income  81,161   66,842   48,019   52,019   73,816  10   196,022   217,782  (10)
    Merger-related and other charges  1,746   7,143   9,016   9,912   1,437     17,905   4,058   
    Income tax benefit of merger-related and other charges  (385)  (1,575)  (1,963)  (2,265)  (328)    (3,923)  (909)  
    Net income - operating (1) $82,522  $72,410  $55,072  $59,666  $74,925  10  $210,004  $220,931  (5)
    Pre-tax pre-provision income (5) $118,941  $91,571  $83,490  $65,576  $84,385  41  $294,002  $244,637  20 
    PERFORMANCE MEASURES                  
    Per common share:                  
    Diluted net income - GAAP $0.74  $0.61  $0.43  $0.55  $0.82  (10) $1.78  $2.42  (26)
    Diluted net income - operating (1)  0.75   0.66   0.50   0.64   0.83  (10)  1.91   2.45  (22)
    Cash dividends declared  0.22   0.21   0.21   0.20   0.20  10   0.64   0.58  10 
    Book value  23.78   23.96   24.38   23.63   23.25  2   23.78   23.25  2 
    Tangible book value (3)  16.52   16.68   17.08   18.42   18.68  (12)  16.52   18.68  (12)
    Key performance ratios:                  
    Return on common equity - GAAP (2)(4)  11.02%  9.31%  6.80%  9.32%  14.26%    9.08%  14.55%  
    Return on common equity - operating (1)(2)(4)  11.21   10.10   7.83   10.74   14.48     9.75   14.77   
    Return on tangible common equity - operating (1)(2)(3)(4)  15.60   14.20   11.00   13.93   18.23     13.64   18.55   
    Return on assets - GAAP (4)  1.32   1.08   0.78   0.96   1.48     1.06   1.52   
    Return on assets - operating (1)(4)  1.34   1.17   0.89   1.10   1.50     1.13   1.54   
    Return on assets - pre-tax pre-provision (4)(5)  1.94   1.49   1.37   1.21   1.70     1.60   1.71   
    Return on assets - pre-tax pre-provision, excluding merger- related and other charges (1)(4)(5)  1.97   1.60   1.52   1.40   1.73     1.70   1.74   
    Net interest margin (fully taxable equivalent) (4)  3.57   3.19   2.97   2.81   3.12     3.25   3.17   
    Efficiency ratio - GAAP  48.41   56.58   57.43   62.12   53.11     53.94   53.72   
    Efficiency ratio - operating (1)  47.66   53.23   53.09   56.48   52.33     51.20   52.97   
    Equity to total assets  11.12   10.95   11.06   10.61   10.89     11.12   10.89   
    Tangible common equity to tangible assets (3)  7.70   7.59   7.72   8.09   8.53     7.70   8.53   
    ASSET QUALITY                  
    Nonperforming assets ("NPAs") $35,511  $34,428  $40,816  $32,855  $45,335  (22) $35,511  $45,335  (22)
    Allowance for credit losses - loans  148,502   136,925   132,805   102,532   99,620  49   148,502   99,620  49 
    Allowance for credit losses - total  167,300   153,042   146,369   113,524   110,875     167,300   110,875   
    Net charge-offs (recoveries)  1,134   (1,069)  2,978   248   551     3,043   (210)  
    Allowance for credit losses - loans to loans  1.00%  0.94%  0.93%  0.87%  0.89%    1.00%  0.89%  
    Allowance for credit losses - total to loans  1.12   1.05   1.02   0.97   0.99     1.12   0.99   
    Net charge-offs to average loans (4)  0.03   (0.03)  0.08   0.01   0.02     0.03      
    NPAs to total assets  0.15   0.14   0.17   0.16   0.23     0.15   0.23   
    AT PERIOD END ($ in millions)                  
    Loans $14,882  $14,541  $14,316  $11,760  $11,191  33  $14,882  $11,191  33 
    Investment securities  6,539   6,683   6,410   5,653   5,335  23   6,539   5,335  23 
    Total assets  23,688   24,213   24,374   20,947   19,481  22   23,688   19,481  22 
    Deposits  20,321   20,873   21,056   18,241   16,865  20   20,321   16,865  20 
    Shareholders’ equity  2,635   2,651   2,695   2,222   2,122  24   2,635   2,122  24 
    Common shares outstanding (thousands)  106,163   106,034   106,025   89,350   86,559  23   106,163   86,559  23 

    (1) Excludes merger-related and other charges. (2) Net income less preferred stock dividends, divided by average realized common equity, which excludes accumulated other comprehensive income (loss). (3) Excludes effect of acquisition related intangibles and associated amortization. (4) Annualized. (5) Excludes income tax expense and provision for credit losses.



    UNITED COMMUNITY BANKS, INC.
    Non-GAAP Performance Measures Reconciliation
    Selected Financial Information
    (in thousands, except per share data)
       2022   2021  For the Nine Months Ended September 30,
      Third
    Quarter
     Second Quarter First
    Quarter
     Fourth Quarter Third
    Quarter
      2022   2021 
                   
    Noninterest expense reconciliation              
    Noninterest expenses (GAAP) $112,755  $120,790  $119,275  $109,156  $96,749  $352,820  $287,483 
    Merger-related and other charges  (1,746)  (7,143)  (9,016)  (9,912)  (1,437)  (17,905)  (4,058)
    Noninterest expenses - operating $111,009  $113,647  $110,259  $99,244  $95,312  $334,915  $283,425 
                   
    Net income reconciliation              
    Net income (GAAP) $81,161  $66,842  $48,019  $52,019  $73,816  $196,022  $217,782 
    Merger-related and other charges  1,746   7,143   9,016   9,912   1,437   17,905   4,058 
    Income tax benefit of merger-related and other charges  (385)  (1,575)  (1,963)  (2,265)  (328)  (3,923)  (909)
    Net income - operating $82,522  $72,410  $55,072  $59,666  $74,925  $210,004  $220,931 
                   
    Net income to pre-tax pre-provision income reconciliation              
    Net income (GAAP) $81,161  $66,842  $48,019  $52,019  $73,816  $196,022  $217,782 
    Income tax expense  22,388   19,125   12,385   14,204   21,603   53,898   63,758 
    Provision for (release of) credit losses  15,392   5,604   23,086   (647)  (11,034)  44,082   (36,903)
    Pre-tax pre-provision income $118,941  $91,571  $83,490  $65,576  $84,385  $294,002  $244,637 
                   
    Diluted income per common share reconciliation              
    Diluted income per common share (GAAP) $0.74  $0.61  $0.43  $0.55  $0.82  $1.78  $2.42 
    Merger-related and other charges, net of tax  0.01   0.05   0.07   0.09   0.01   0.13   0.03 
    Diluted income per common share - operating $0.75  $0.66  $0.50  $0.64  $0.83  $1.91  $2.45 
                   
    Book value per common share reconciliation              
    Book value per common share (GAAP) $23.78  $23.96  $24.38  $23.63  $23.25  $23.78  $23.25 
    Effect of goodwill and other intangibles  (7.26)  (7.28)  (7.30)  (5.21)  (4.57)  (7.26)  (4.57)
    Tangible book value per common share $16.52  $16.68  $17.08  $18.42  $18.68  $16.52  $18.68 
                   
    Return on tangible common equity reconciliation              
    Return on common equity (GAAP)  11.02%  9.31%  6.80%  9.32%  14.26%  9.08%  14.55%
    Merger-related and other charges, net of tax  0.19   0.79   1.03   1.42   0.22   0.67   0.22 
    Return on common equity - operating  11.21   10.10   7.83   10.74   14.48   9.75   14.77 
    Effect of goodwill and other intangibles  4.39   4.10   3.17   3.19   3.75   3.89   3.78 
    Return on tangible common equity - operating  15.60%  14.20%  11.00%  13.93%  18.23%  13.64%  18.55%
                   
    Return on assets reconciliation              
    Return on assets (GAAP)  1.32%  1.08%  0.78%  0.96%  1.48%  1.06%  1.52%
    Merger-related and other charges, net of tax  0.02   0.09   0.11   0.14   0.02   0.07   0.02 
    Return on assets - operating  1.34%  1.17%  0.89%  1.10%  1.50%  1.13%  1.54%
                   
    Return on assets to return on assets- pre-tax pre-provision reconciliation              
    Return on assets (GAAP)  1.32%  1.08%  0.78%  0.96%  1.48%  1.06%  1.52%
    Income tax expense  0.37   0.32   0.20   0.26   0.45   0.30   0.45 
    (Release of) provision for credit losses  0.25   0.09   0.39   (0.01)  (0.23)  0.24   (0.26)
    Return on assets - pre-tax, pre-provision  1.94   1.49   1.37   1.21   1.70   1.60   1.71 
    Merger-related and other charges  0.03   0.11   0.15   0.19   0.03   0.10   0.03 
    Return on assets - pre-tax pre-provision, excluding merger-related and other charges  1.97%  1.60%  1.52%  1.40%  1.73%  1.70%  1.74%
                   
    Efficiency ratio reconciliation              
    Efficiency ratio (GAAP)  48.41%  56.58%  57.43%  62.12%  53.11%  53.94%  53.72%
    Merger-related and other charges  (0.75)  (3.35)  (4.34)  (5.64)  (0.78)  (2.74)  (0.75)
    Efficiency ratio - operating  47.66%  53.23%  53.09%  56.48%  52.33%  51.20%  52.97%
                   
    Tangible common equity to tangible assets reconciliation              
    Equity to total assets (GAAP)  11.12%  10.95%  11.06%  10.61%  10.89%  11.12%  10.89%
    Effect of goodwill and other intangibles     (2.96)  (2.94)  (2.06)  (1.87)     (1.87)
    Effect of preferred equity  (3.42)  (0.40)  (0.40)  (0.46)  (0.49)  (3.42)  (0.49)
    Tangible common equity to tangible assets  7.70%  7.59%  7.72%  8.09%  8.53%  7.70%  8.53%



    UNITED COMMUNITY BANKS, INC.
    Financial Highlights
    Loan Portfolio Composition at Period-End
      2022  2021   Linked Quarter Change

     Year over Year Change

    (in millions)Third Quarter Second Quarter First Quarter Fourth Quarter Third Quarter  
    LOANS BY CATEGORY             
    Owner occupied commercial RE$2,700 $2,681 $2,638 $2,322 $2,149 $19  $551 
    Income producing commercial RE 3,299  3,273  3,328  2,601  2,542  26   757 
    Commercial & industrial 2,236  2,243  2,302  1,822  1,729  (7)  507 
    Paycheck protection program 2  10  34  88  150  (8)  (148)
    Commercial construction 1,514  1,514  1,482  1,015  947     567 
    Equipment financing 1,281  1,211  1,148  1,083  1,017  70   264 
    Total commercial 11,032  10,932  10,932  8,931  8,534  100   2,498 
    Residential mortgage 2,149  1,997  1,826  1,638  1,533  152   616 
    Home equity lines of credit 832  801  778  694  661  31   171 
    Residential construction 423  381  368  359  321  42   102 
    Manufactured housing 301  287  269      14   301 
    Consumer 145  143  143  138  142  2   3 
    Total loans$14,882 $14,541 $14,316 $11,760 $11,191 $341  $3,691 
                  
    LOANS BY MARKET             
    Georgia$4,003 $3,960 $3,879 $3,778 $3,732 $43  $271 
    South Carolina 2,516  2,377  2,323  2,235  2,145  139   371 
    North Carolina 2,117  2,006  1,879  1,895  1,427  111   690 
    Tennessee 2,536  2,621  2,661  373  383  (85)  2,153 
    Florida 1,259  1,235  1,208  1,148  1,113  24   146 
    Commercial Banking Solutions 2,451  2,342  2,366  2,331  2,391  109   60 
    Total loans$14,882 $14,541 $14,316 $11,760 $11,191 $341  $3,691 



    UNITED COMMUNITY BANKS, INC.
    Financial Highlights
    Credit Quality
    (in thousands)
      2022
      Third
    Quarter
     Second
    Quarter
     First
    Quarter
    NONACCRUAL LOANS      
    Owner occupied RE $877 $1,876 $4,590
    Income producing RE  2,663  7,074  7,220
    Commercial & industrial  11,108  4,548  6,227
    Commercial construction  150  208  401
    Equipment financing  3,198  3,249  2,540
    Total commercial  17,996  16,955  20,978
    Residential mortgage  10,424  12,228  13,024
    Home equity lines of credit  1,151  933  1,183
    Residential construction  104  198  212
    Manufactured housing  4,187  2,804  2,507
    Consumer  17  25  40
    Total nonaccrual loans held for investment  33,879  33,143  37,944
    Nonaccrual loans held for sale  316  317  2,033
    OREO and repossessed assets  1,316  968  839
    Total NPAs $35,511 $34,428 $40,816


       2022 
      Third Quarter Second Quarter First Quarter
    (in thousands) Net Charge-Offs Net Charge-Offs to Average
    Loans
    (1)
     Net Charge-Offs Net Charge-Offs to Average
    Loans
    (1)
     Net Charge-Offs Net Charge-Offs to Average
    Loans
    (1)
    NET CHARGE-OFFS (RECOVERIES) BY CATEGORY            
    Owner occupied RE $(90) (0.01)% $(1,496) (0.23)% $(45) (0.01)%
    Income producing RE  176  0.02   (116) (0.01)  (290) (0.04)
    Commercial & industrial  (744) (0.13)  (302) (0.05)  2,929  0.51 
    Commercial construction  10     (144) (0.04)  (373) (0.10)
    Equipment financing  1,121  0.36   907  0.31   267  0.10 
    Total commercial  473  0.02   (1,151) (0.04)  2,488  0.09 
    Residential mortgage  (66) (0.01)  (51) (0.01)  (97) (0.02)
    Home equity lines of credit  (102) (0.05)  (346) (0.18)  (81) (0.04)
    Residential construction  (109) (0.11)  (76) (0.08)  (23) (0.03)
    Manufactured housing  220  0.30   135  0.20   164  0.25 
    Consumer  718  1.98   420  1.18   527  1.48 
    Total $1,134  0.03  $(1,069) (0.03) $2,978  0.08 
                 
    (1) Annualized.            



    UNITED COMMUNITY BANKS, INC.  
    Consolidated Balance Sheets (Unaudited)

         
         
    (in thousands, except share and per share data) September 30,
    2022
     December 31, 2021
    ASSETS    
    Cash and due from banks $222,524  $144,244 
    Interest-bearing deposits in banks  216,496   2,147,266 
    Federal funds and other short-term investments  45,000   27,000 
    Cash and cash equivalents  484,020   2,318,510 
    Debt securities available-for-sale  3,862,886   4,496,824 
    Debt securities held-to-maturity (fair value $2,241,160 and $1,148,804, respectively)  2,676,405   1,156,098 
    Loans held for sale  21,967   44,109 
    Loans and leases held for investment  14,882,484   11,760,346 
    Less allowance for credit losses - loans and leases  (148,502)  (102,532)
    Loans and leases, net  14,733,982   11,657,814 
    Premises and equipment, net  288,597   245,296 
    Bank owned life insurance  300,365   217,713 
    Goodwill and other intangible assets, net  780,868   472,407 
    Other assets  538,765   338,000 
    Total assets $23,687,855  $20,946,771 
    LIABILITIES AND SHAREHOLDERS' EQUITY    
    Liabilities:    
    Deposits:    
    Noninterest-bearing demand $8,198,129  $6,956,981 
    NOW and interest-bearing demand  4,208,731   4,252,209 
    Money market  4,638,509   4,183,354 
    Savings  1,508,557   1,215,779 
    Time  1,622,608   1,442,498 
    Brokered  144,608   190,358 
    Total deposits  20,321,142   18,241,179 
    Long-term debt  324,515   247,360 
    Accrued expenses and other liabilities  407,488   235,987 
    Total liabilities  21,053,145   18,724,526 
    Shareholders' equity:    
    Preferred stock; $1 par value; 10,000,000 shares authorized;
        4,000 shares Series I issued and outstanding, $25,000 per share liquidation preference
      96,422   96,422 
    Common stock, $1 par value; 200,000,000 shares authorized,
       106,162,861 and 89,349,826 shares issued and outstanding, respectively
      106,163   89,350 
    Common stock issuable; 596,365 and 595,705 shares, respectively  11,966   11,288 
    Capital surplus  2,304,514   1,721,007 
    Retained earnings  452,788   330,654 
    Accumulated other comprehensive loss  (337,143)  (26,476)
    Total shareholders' equity  2,634,710   2,222,245 
    Total liabilities and shareholders' equity $23,687,855  $20,946,771 



    UNITED COMMUNITY BANKS, INC.  
    Consolidated Statements of Income (Unaudited)

      Three Months Ended
    September 30,
     Nine Months Ended
    September 30,
    (in thousands, except per share data)  2022  2021   2022   2021 
    Interest revenue:        
    Loans, including fees $174,065 $128,477  $476,072  $382,261 
    Investment securities, including tax exempt of $2,568, $2,280, $7,762 and $6,685, respectively  36,953  18,540   91,043   51,530 
    Deposits in banks and short-term investments  2,869  658   5,209   1,235 
    Total interest revenue  213,887  147,675   572,324   435,026 
             
    Interest expense:        
    Deposits:        
    NOW and interest-bearing demand  3,992  1,290   7,624   4,158 
    Money market  4,503  1,119   7,030   4,278 
    Savings  178  55   337   157 
    Time  1,207  678   2,322   3,388 
    Deposits  9,880  3,142   17,313   11,981 
    Short-term borrowings  27     27   2 
    Long-term debt  4,206  3,494   12,515   11,564 
    Total interest expense  14,113  6,636   29,855   23,547 
    Net interest revenue  199,774  141,039   542,469   411,479 
    Provision for (release of) credit losses  15,392  (11,034)  44,082   (36,903)
    Net interest revenue after provision for credit losses  184,382  152,073   498,387   448,382 
             
    Noninterest income:        
    Service charges and fees  9,569  9,350   28,644   25,255 
    Mortgage loan gains and other related fees  6,297  13,828   29,420   47,536 
    Wealth management fees  5,879  5,554   17,759   12,881 
    Gains from sales of other loans, net  2,228  2,353   9,226   7,506 
    Lending and loan servicing fees  2,946  2,825   7,518   7,070 
    Securities gains (losses), net       (3,688)  41 
    Other  5,003  6,185   15,474   20,352 
    Total noninterest income  31,922  40,095   104,353   120,641 
    Total revenue  216,304  192,168   602,740   569,023 
             
    Noninterest expenses:        
    Salaries and employee benefits  67,823  60,458   208,062   180,457 
    Communications and equipment  8,795  7,368   27,718   21,979 
    Occupancy  9,138  7,096   27,381   21,130 
    Advertising and public relations  2,544  1,458   6,332   4,150 
    Postage, printing and supplies  2,190  1,731   6,308   5,171 
    Professional fees  4,821  5,347   14,670   14,509 
    Lending and loan servicing expense  2,333  2,450   7,746   8,508 
    Outside services - electronic banking  3,159  2,308   8,629   6,811 
    FDIC assessments and other regulatory charges  2,356  1,723   6,796   5,520 
    Amortization of intangibles  1,678  1,028   5,207   2,942 
    Merger-related and other charges  1,746  1,437   17,905   4,058 
    Other  6,172  4,345   16,066   12,248 
    Total noninterest expenses  112,755  96,749   352,820   287,483 
    Income before income taxes  103,549  95,419   249,920   281,540 
    Income tax expense  22,388  21,603   53,898   63,758 
    Net income  81,161  73,816   196,022   217,782 
    Preferred stock dividends  1,719  1,719   5,157   5,157 
    Earnings allocated to participating securities  407  448   1,007   1,342 
    Net income available to common shareholders $79,035 $71,649  $189,858  $211,283 
             
    Net income per common share:        
    Basic $0.74 $0.82  $1.78  $2.42 
    Diluted  0.74  0.82   1.78   2.42 
    Weighted average common shares outstanding:        
    Basic  106,687  87,211   106,616   87,274 
    Diluted  106,800  87,355   106,732   87,413 



    Average Consolidated Balance Sheets and Net Interest Analysis  
    For the Three Months Ended September 30,

       2022   2021 
    (dollars in thousands, fully taxable equivalent (FTE)) Average Balance Interest Average Rate Average Balance Interest Average Rate
    Assets:            
    Interest-earning assets:            
    Loans, net of unearned income (FTE) (1)(2) $14,658,397  $174,168 4.71% $11,204,653  $128,185 4.54%
    Taxable securities (3)  6,539,615   34,385 2.10   4,738,860   16,260 1.37 
    Tax-exempt securities (FTE) (1)(3)  493,115   3,449 2.80   383,196   3,061 3.20 
    Federal funds sold and other interest-earning assets  614,755   3,106 2.00   1,751,222   1,185 0.27 
    Total interest-earning assets (FTE)  22,305,882   215,108 3.83   18,077,931   148,691 3.27 
                 
    Noninterest-earning assets:            
    Allowance for credit losses  (138,907)      (111,952)    
    Cash and due from banks  231,376       124,360     
    Premises and equipment  290,768       228,556     
    Other assets (3)  1,261,236       1,002,810     
    Total assets $23,950,355      $19,321,705     
                 
    Liabilities and Shareholders' Equity:            
    Interest-bearing liabilities:            
    Interest-bearing deposits:            
    NOW and interest-bearing demand $4,335,619   3,992 0.37  $3,594,670   1,290 0.14 
    Money market  4,849,705   4,503 0.37   4,010,720   1,119 0.11 
    Savings  1,515,350   178 0.05   1,120,843   55 0.02 
    Time  1,635,580   984 0.24   1,466,821   609 0.16 
    Brokered time deposits  51,530   223 1.72   63,917   69 0.43 
    Total interest-bearing deposits  12,387,784   9,880 0.32   10,256,971   3,142 0.12 
    Federal funds purchased and other borrowings  3,442   27 3.11        
    Federal Home Loan Bank advances         54     
    Long-term debt  324,444   4,206 5.14   257,139   3,494 5.39 
    Total borrowed funds  327,886   4,233 5.12   257,193   3,494 5.39 
    Total interest-bearing liabilities  12,715,670   14,113 0.44   10,514,164   6,636 0.25 
                 
    Noninterest-bearing liabilities:            
    Noninterest-bearing deposits  8,176,987       6,379,969     
    Other liabilities  349,647       308,551     
    Total liabilities  21,242,304       17,202,684     
    Shareholders' equity  2,708,051       2,119,021     
    Total liabilities and shareholders' equity $23,950,355      $19,321,705     
                 
    Net interest revenue (FTE)   $200,995     $142,055  
    Net interest-rate spread (FTE)     3.39%     3.02%
    Net interest margin (FTE) (4)     3.57%     3.12%


    (1)Interest revenue on tax-exempt securities and loans has been increased to reflect comparable interest on taxable securities and loans. The rate used was 26%, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate.
    (2)Included in the average balance of loans outstanding are loans on which the accrual of interest has been discontinued and loans that are held for sale.
    (3)Unrealized gains and losses on securities, including those related to the transfer from AFS to HTM, have been reclassified to other assets. Pretax unrealized losses of $318 million in 2022 and pretax unrealized gains of $39.6 million in 2021 are included in other assets for purposes of this presentation.
    (4)Net interest margin is taxable equivalent net interest revenue divided by average interest-earning assets.



    Average Consolidated Balance Sheets and Net Interest Analysis 
    For the Nine Months Ended September 30,

       2022   2021 
    (dollars in thousands, fully taxable equivalent (FTE)) Average Balance Interest Average Rate Average Balance Interest Average Rate
    Assets:            
    Interest-earning assets:            
    Loans, net of unearned income (FTE) (1)(2) $14,426,470  $475,989 4.41% $11,417,285  $380,765 4.46%
    Taxable securities (3)  6,274,230   83,281 1.77   4,206,099   44,845 1.42 
    Tax-exempt securities (FTE) (1)(3)  498,177   10,425 2.79   381,323   8,979 3.14 
    Federal funds sold and other interest-earning assets  1,271,287   6,192 0.65   1,468,487   3,462 0.31 
    Total interest-earning assets (FTE)  22,470,164   575,887 3.43   17,473,194   438,051 3.35 
                 
    Non-interest-earning assets:            
    Allowance for loan losses  (129,278)      (127,793)    
    Cash and due from banks  200,463       138,973     
    Premises and equipment  284,850       225,021     
    Other assets (3)  1,308,647       1,007,669     
    Total assets $24,134,846      $18,717,064     
                 
    Liabilities and Shareholders' Equity:            
    Interest-bearing liabilities:            
    Interest-bearing deposits:            
    NOW and interest-bearing demand $4,520,079   7,624 0.23  $3,452,206   4,158 0.16 
    Money market  4,992,357   7,030 0.19   3,853,907   4,278 0.15 
    Savings  1,483,169   337 0.03   1,064,045   157 0.02 
    Time  1,688,250   2,009 0.16   1,551,934   3,096 0.27 
    Brokered time deposits  65,133   313 0.64   67,794   292 0.58 
    Total interest-bearing deposits  12,748,988   17,313 0.18   9,989,886   11,981 0.16 
    Federal funds purchased and other borrowings  1,383   27 2.61   41     
    Federal Home Loan Bank advances         1,117   2 0.24 
    Long-term debt  322,600   12,515 5.19   286,347   11,564 5.40 
    Total borrowed funds  323,983   12,542 5.18   287,505   11,566 5.38 
    Total interest-bearing liabilities  13,072,971   29,855 0.31   10,277,391   23,547 0.31 
                 
    Noninterest-bearing liabilities:            
    Noninterest-bearing deposits  7,958,392       6,059,680     
    Other liabilities  375,182       311,749     
    Total liabilities  21,406,545       16,648,820     
    Shareholders' equity  2,728,301       2,068,244     
    Total liabilities and shareholders' equity $24,134,846      $18,717,064     
                 
    Net interest revenue (FTE)   $546,032     $414,504  
    Net interest-rate spread (FTE)     3.12%     3.04%
    Net interest margin (FTE) (4)     3.25%     3.17%
                 


    (1)Interest revenue on tax-exempt securities and loans has been increased to reflect comparable interest on taxable securities and loans. The rate used was 26%, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate.
    (2)Included in the average balance of loans outstanding are loans on which the accrual of interest has been discontinued and loans that are held for sale.
    (3)Unrealized gains and losses on securities, including those related to the transfer from AFS to HTM, have been reclassified to other assets. Pretax unrealized losses of $221 million in 2022 and pretax unrealized gains of $40.3 million in 2021, respectively, are included in other assets for purposes of this presentation.
    (4)Net interest margin is taxable equivalent net-interest revenue divided by average interest-earning assets.


    About United Community Banks, Inc.

    United Community Banks, Inc. (NASDAQGS: UCBI) provides a full range of banking, wealth management and mortgage services for relationship-oriented consumers and business owners. As of September 30, 2022, United had $23.7 billion in assets and 193 offices in Florida, Georgia, North Carolina, South Carolina and Tennessee, along with a national SBA lending franchise and a national equipment lending subsidiary. The company, known as “The Bank That SERVICE Built,” has been recognized nationally for delivering award-winning service. In 2022, J.D. Power ranked United highest in customer satisfaction with consumer banking in the Southeast, marking eight out of the last nine years United earned the coveted award. Forbes recognized United as one of the top ten World’s Best Banks in 2022. Forbes also included United on its 2022 list of the 100 Best Banks in America for the ninth consecutive year. United also received ten Greenwich Excellence Awards in 2021 for excellence in Small Business Banking and Middle Market Banking, including national awards for Overall Satisfaction and Likelihood to Recommend. United was also named one of the "Best Banks to Work For" by American Banker in 2021 for the fifth consecutive year based on employee satisfaction. Additional information about United can be found at www.ucbi.com.

    Non-GAAP Financial Measures

    This press release, including the accompanying financial statement tables, contains financial information determined by methods other than in accordance with generally accepted accounting principles, or GAAP. This financial information, which excludes merger-related and other charges that are not considered part of recurring operations, includes performance measures such as “operating net income,” “pre-tax, pre-provision income,” “operating net income per diluted common share,” “operating earnings per share,” “tangible book value per common share,” “operating return on common equity,” “operating return on tangible common equity,” “operating return on assets,” “return on assets - pre-tax, pre-provision, excluding merger-related and other charges,” “return on assets - pre-tax, pre-provision,” “operating efficiency ratio,” and “tangible common equity to tangible assets.” These non-GAAP measures are included because United believes they may provide useful supplemental information for evaluating United’s underlying performance trends. These measures should be viewed in addition to, and not as an alternative to or substitute for, measures determined in accordance with GAAP, and are not necessarily comparable to non-GAAP measures that may be presented by other companies. To the extent applicable, reconciliations of these non-GAAP measures to the most directly comparable measures as reported in accordance with GAAP are included with the accompanying financial statement tables.

    For more information:

    Jefferson Harralson
    Chief Financial Officer
    (864) 240-6208
    Jefferson_Harralson@ucbi.com


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