• Net income of $74.2 million, or $0.56 per diluted share, core net income1 of $75.9 million or $0.57 per diluted share1
  • Increased 2019 stock repurchase authority by $50 million to a total of $150 million
  • Board of Directors declared a quarterly dividend of $0.26 per share

HONOLULU, Oct. 24, 2019 (GLOBE NEWSWIRE) -- First Hawaiian, Inc. (NASDAQ:FHB), (“First Hawaiian” or the “Company”) today reported financial results for its quarter ended September 30, 2019.

“The bank had another solid performance in the third quarter.  Our earnings were driven by excellent credit quality and continued prudent expense management,” said Bob Harrison, Chairman, President and Chief Executive Officer.  “During the quarter we continued to improve the quality of our balance sheet as we sold over $400 million of shared national credits and reduced public time deposits, enabling us to increase the size of our stock repurchase program.”

On October 23, 2019, the Company’s Board of Directors declared a quarterly cash dividend of $0.26 per share.  The dividend will be payable on December 6, 2019 to stockholders of record at the close of business on November 25, 2019.

Third Quarter 2019 Highlights:

  • Profitability measures were excellent with ROA of 1.45%, core ROATA1,2 of 1.56%, ROE of 11.12%, and core ROATCE1,2 of 18.21%;
  • Sold $409 million of shared national credits (SNCs) at an average price of 99.7%;
  • Reduced the balance of public time deposits by $334 million and the cost of deposits fell 3 basis points to 54 basis points;
  • Reported efficiency ratio was 48.4% and core efficiency ratio1 was 47.3%;
  • Continued excellent credit quality.  The ratio of non-performing assets to total loans and leases and other real estate owned was 0.03% at the end of the third quarter;
  • No provision expense was recorded due to the reduction in the loan portfolio following the sale of the SNCs;
  • Repurchased 2.3 million shares at total cost of $59 million;
  • Announced a $50 million increase in the stock repurchase program, bringing the total repurchase authority to $150 million in 2019.

Balance Sheet

Total assets were $20.6 billion as of September 30, 2019, compared to $20.5 billion as of June 30, 2019.

Gross loans and leases were $12.8 billion as of September 30, 2019, a decrease of $421 million, or 3.2%, from $13.3 billion as of June 30, 2019.  The decrease was primarily due to the approximately $450 million reduction in SNC loans, which included $409 million of SNC loans sold and an additional $40 million of runoff in the SNC loan portfolio.

Total deposits were $16.9 billion as of September 30, 2019, an increase of $65 million, or 0.4%, from $16.8 billion as of June 30, 2019, primarily reflecting a $334 million reduction in public time deposits and the receipt of $400 million of temporary commercial deposits that were withdrawn early in the fourth quarter. 

_______________
1 Core measurements are non-GAAP financial measures.  Core excludes certain gains, expenses and one-time items.  See Tables 13 and 14 at the end of this document for reconciliations of core measurements, including core net income, core noninterest income, core efficiency ratio and core earnings per diluted share to the comparable GAAP measurements.
2 Return on Average Tangible Assets (“ROATA”) and Return on Average Tangible Common Equity (“ROATCE”) are non-GAAP financial measures.  A reconciliation of average tangible assets and average tangible stockholders’ equity to the comparable GAAP measurements is provided in Table 13 at the end of this document.

Net Interest Income

Net interest income for the third quarter of 2019 was $143.1 million, a decrease of $2.5 million, or 1.7%, compared to $145.6 million for the prior quarter.  Net interest income in the third quarter included a negative $1.7 million premium adjustment, while the second quarter included a negative $1.8 million premium adjustment. The decrease in net interest income compared to the second quarter of 2019 was primarily due to lower yields and balances on loans and investments, partially offset by lower deposit balances.

NIM was 3.19% in the third quarter of 2019, a decrease of six basis points compared to 3.25% in the second quarter of 2019.  The negative $1.7 million premium adjustment in the third quarter and the negative $1.8 million premium adjustment in the second quarter had a negative four basis point impact on the reported NIM in each quarter.

Provision Expense

No provision for credit losses was taken in the quarter ended September 30, 2019 compared to $3.9 million in the quarter ended June 30, 2019.    

Noninterest Income

Noninterest income was $50.0 million in the third quarter of 2019, an increase of $1.2 million compared to noninterest income of $48.8 million in the second quarter of 2019.     

Noninterest Expense

Noninterest expense was $93.5 million in the third quarter of 2019, essentially unchanged from $93.3 million in the second quarter of 2019. 

The efficiency ratio was 48.4% and 48.0% for the quarters ended September 30, 2019 and June 30, 2019, respectively.  Core efficiency ratio1 was 47.3% and 47.9% for the quarters ended September 30, 2019 and June 30, 2019, respectively.

Taxes

The effective tax rate was 25.5% for the quarters ended September 30, 2019 and June 30, 2019.

Asset Quality

The allowance for loan and lease losses was $133.0 million, or 1.04% of total loans and leases, as of September 30, 2019, compared to $138.5 million, or 1.04% of total loans and leases, as of June 30, 2019.  Net charge-offs were $5.6 million, or 0.17% of average loans and leases on an annualized basis for the quarter ended September 30, 2019, compared to $6.9 million, or 0.21% of average loans and leases on an annualized basis for the quarter ended June 30, 2019.  Total non-performing assets were $4.3 million, or 0.03% of total loans and leases and other real estate owned, at September 30, 2019, compared to non-performing assets of $3.9 million, or 0.03% of total loans and leases and other real estate owned, at June 30, 2019. 

Capital

Total stockholders' equity was $2.7 billion at September 30, 2019 and June 30, 2019.   

The tier 1 leverage, common equity tier 1 and total capital ratios were 8.68%, 12.15% and 13.11%, respectively, at September 30, 2019, compared with 8.75%, 11.84% and 12.81% at June 30, 2019.

During the third quarter of 2019, the Company’s Board of Directors approved a $50 million increase in the stock repurchase program to up to $150 million during 2019.  The Company repurchased 2.3 million shares of common stock at a total cost of $59 million under the stock repurchase program in the third quarter. The average cost was $25.69 per share repurchased.  Year-to-date through September 30, the Company has repurchased 3.8 million shares at a total cost of $99 million.  Remaining buyback authority under the stock repurchase program was $51 million at September 30, 2019.

First Hawaiian, Inc. 

First Hawaiian, Inc. (NASDAQ:FHB) is a bank holding company headquartered in Honolulu, Hawaii.  Its principal subsidiary, First Hawaiian Bank, founded in 1858 under the name Bishop & Company, is Hawaii’s oldest and largest financial institution with branch locations throughout Hawaii, Guam and Saipan. The company offers a comprehensive suite of banking services to consumer and commercial customers including deposit products, loans, wealth management, insurance, trust, retirement planning, credit card and merchant processing services.  Customers may also access their accounts through ATMs, online and mobile banking channels. For more information about First Hawaiian, Inc., visit the Company’s website, www.fhb.com.

Conference Call Information

First Hawaiian will host a conference call to discuss the Company’s results today at 5:00 p.m. Eastern Time, 11:00 a.m. Hawaii Time.  To access the call, participants should dial (844) 452-2942 (US/Canada), or (574) 990-9846 (International) ten minutes prior to the start of the call and enter the conference ID:  1875646.  A live webcast of the conference call, including a slide presentation, will be available at the following link:  www.fhb.com/earnings.  The archive of the webcast will be available at the same location.  A telephonic replay of the conference call will be available two hours after the conclusion of the call until 8:30 p.m. (Eastern Time) on October 31, 2019.  Access the replay by dialing (855) 859-2056 or (404) 537-3406 and entering the conference ID:  1875646.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance.  These statements are often, but not always, made through the use of words or phrases such as “may”, “might”, “should”, “could”, “predict”, “potential”, “believe”, “expect”, “continue”, “will”, “anticipate”, “seek”, “estimate”, “intend”, “plan”, “projection”, “would”, “annualized” and “outlook”, or the negative version of those words or other comparable words or phrases of a future or forward-looking nature.  These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management's beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control.  Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, estimates and uncertainties that are difficult to predict.  Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, actual results may prove to be materially different from the results expressed or implied by the forward-looking statements.  For a discussion of some of the risks and important factors that could affect our future results and financial condition, see our U.S. Securities and Exchange Commission (“SEC”) filings, including, but not limited to, our Annual Report on Form 10-K for the year ended December 31, 2018 and our Quarterly Report on Form 10-Q for the quarter ended June 30, 2019.

Use of Non-GAAP Financial Measures

We present net interest income, noninterest income, noninterest expense, net income, earnings per share (basic and diluted) and the related ratios described below, on an adjusted, or ‘‘core,’’ basis, each a non-GAAP financial measure.  These core measures exclude from the corresponding GAAP measure the impact of certain items that we do not believe are representative of our financial results.  We believe that the presentation of these non-GAAP financial measures helps identify underlying trends in our business from period to period that could otherwise be distorted by the effect of certain expenses, gains and other items included in our operating results. We believe that these core measures provide useful information about our operating results and enhance the overall understanding of our past performance and future performance.  Investors should consider our performance and financial condition as reported under GAAP and all other relevant information when assessing our performance or financial condition. 

Core net interest margin, core efficiency ratio, core return on average total assets and core return on average total stockholders’ equity are non-GAAP financial measures.  We compute our core net interest margin as the ratio of core net interest income to average earning assets.  We compute our core efficiency ratio as the ratio of core noninterest expense to the sum of core net interest income and core noninterest income.  We compute our core return on average total assets as the ratio of core net income to average total assets.  We compute our core return on average total stockholders’ equity as the ratio of core net income to average total stockholders’ equity. 

Return on average tangible stockholders’ equity, core return on average tangible stockholders’ equity, return on average tangible assets, core return on average tangible assets and tangible stockholders’ equity to tangible assets are non-GAAP financial measures.  We compute our return on average tangible stockholders’ equity as the ratio of net income to average tangible stockholders’ equity, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total stockholders’ equity.  We compute our core return on average tangible stockholders’ equity as the ratio of core net income to average tangible stockholders’ equity, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total stockholders’ equity.  We compute our return on average tangible assets as the ratio of net income to average tangible assets, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total assets.  We compute our core return on average tangible assets as the ratio of core net income to average tangible assets. We compute our tangible stockholders’ equity to tangible assets as the ratio of tangible stockholders’ equity to tangible assets, each of which we calculate by subtracting (and thereby effectively excluding) the value of our goodwill. We believe that these measurements are useful for investors, regulators, management and others to evaluate financial performance and capital adequacy relative to other financial institutions.  Although these non-GAAP financial measures are frequently used by stakeholders in the evaluation of a company, they have limitations as analytical tools and should not be considered in isolation or as a substitute for analysis of our results or financial condition as reported under GAAP.

Tables 13 and 14 at the end of this document provide a reconciliation of these non-GAAP financial measures with their most directly comparable GAAP measures.

Investor Relations Contact:
Kevin Haseyama, CFA
(808) 525-6268
khaseyama@fhb.com
                             Media Contact:
Susan Kam
(808) 525-6254
skam@fhb.com
   


Financial Highlights            Table 1 
  For the Three Months Ended For the Nine Months Ended  
  September 30,  June 30,  September 30,  September 30,  
(dollars in thousands, except per share data) 2019 2019 2018 2019 2018 
Operating Results:                
Net interest income $143,081 $145,613 $141,258 $433,783 $422,333 
Provision for loan and lease losses    3,870  4,460  9,550  16,430 
Noninterest income  49,980  48,773  47,405  145,825  145,902 
Noninterest expense  93,466  93,290  93,147  279,379  275,599 
Net income  74,199  72,433  67,388  216,556  204,399 
Basic earnings per share  0.56  0.54  0.50  1.62  1.48 
Diluted earnings per share  0.56  0.54  0.50  1.61  1.48 
Dividends declared per share  0.26  0.26  0.24  0.78  0.72 
Dividend payout ratio  46.43% 48.15% 48.00% 48.45% 48.65%
Supplemental Income Statement Data (non-GAAP):                
Core net interest income $143,081 $145,613 $141,258 $433,783 $422,333 
Core noninterest income  49,980  48,752  47,405  148,417  145,902 
Core noninterest expense  91,222  93,029  88,511  276,613  269,642 
Core net income  75,871  72,612  70,818  220,535  208,797 
Core basic earnings per share  0.57  0.54  0.52  1.65  1.52 
Core diluted earnings per share  0.57  0.54  0.52  1.64  1.52 
Performance Ratio(1):                
Net interest margin  3.19 3.25 3.11 3.22 3.14%
Core net interest margin (non-GAAP)  3.19 3.25 3.11 3.22 3.14%
Efficiency ratio  48.41 47.99 49.36 48.20 48.49%
Core efficiency ratio (non-GAAP)  47.25 47.86 46.90 47.51 47.44%
Return on average total assets  1.45 1.42 1.31 1.42 1.35%
Core return on average total assets (non-GAAP)  1.48 1.43 1.38 1.44 1.37%
Return on average tangible assets (non-GAAP)  1.52 1.50 1.38 1.49 1.42%
Core return on average tangible assets (non-GAAP)(2)  1.56 1.50 1.45 1.52 1.45%
Return on average total stockholders' equity  11.12 11.13 11.01 11.13 11.09%
Core return on average total stockholders' equity (non-GAAP)  11.37 11.16 11.57 11.34 11.33%
Return on average tangible stockholders' equity (non-GAAP)  17.81 17.99 18.66 18.04 18.60%
Core return on average tangible stockholders’ equity (non-GAAP)(3)  18.21 18.03 19.61 18.37 19.00%
Average Balances:                
Average loans and leases $13,032,349 $13,209,655 $12,595,668 $13,105,086 $12,482,747 
Average earning assets  17,862,564  17,971,615  18,041,483  17,974,363  17,982,396 
Average assets  20,332,457  20,390,273  20,391,456  20,405,261  20,306,833 
Average deposits  16,573,796  16,664,837  17,158,849  16,700,366  17,286,159 
Average stockholders' equity  2,648,428  2,610,565  2,427,907  2,600,259  2,464,601 
Market Value Per Share:                
  Closing  26.70  25.87  27.16  26.70  27.16 
  High  27.84  28.20  30.02  28.20  32.36 
  Low  24.25  24.83  27.02  22.13  26.92 
                 


   As of   As of   As of   As of  
   September 30,    June 30,    December 31,    September 30,   
  2019 2019 2018 2018 
Balance Sheet Data:             
Loans and leases $  12,843,396  $  13,264,609 $  13,076,191 $  12,600,464 
Total assets    20,598,220     20,526,367    20,695,678    19,983,838 
Total deposits    16,857,246     16,792,078    17,150,068    16,689,273 
Short-term borrowings    400,000     200,000    —    30,000 
Long-term borrowings    200,018     400,028    600,026    400,026 
Total stockholders' equity    2,654,558     2,659,441    2,524,839    2,423,462 
              
Per Share of Common Stock:             
Book value $  20.22  $  19.92 $  18.72 $  17.97 
Tangible book value (non-GAAP)(4)    12.64     12.46    11.34    10.59 
              
Asset Quality Ratios:             
Non-accrual loans and leases / total loans and leases    0.03    0.03%   0.05%   0.09
Allowance for loan and lease losses / total loans and leases    1.04    1.04%   1.08%   1.12
              
Capital Ratios:             
Common Equity Tier 1 Capital Ratio     12.15    11.84%   11.97%   12.09
Tier 1 Capital Ratio    12.15    11.84%   11.97%   12.09
Total Capital Ratio    13.11    12.81%   12.99%   13.14
Tier 1 Leverage Ratio    8.68    8.75%   8.72%   8.42
Total stockholders' equity to total assets    12.89    12.96%   12.20%   12.13
Tangible stockholders' equity to tangible assets (non-GAAP)    8.46    8.52%   7.76%   7.52
              
Non-Financial Data:             
Number of branches    58     59    60    60 
Number of ATMs    293     292    295    296 
Number of Full-Time Equivalent Employees    2,099     2,123    2,155    2,166 
              


Consolidated Statements of Income Table 2
  Three Months Ended For the Nine Months Ended
  September 30,  June 30,  September 30,  September 30, 
(dollars in thousands, except per share amounts) 2019 2019 2018 2019 2018
Interest income               
Loans and lease financing $  144,691  $  146,883 $  135,394 $  435,980   $  389,228
Available-for-sale securities    22,256     24,784    25,196    71,526      81,586
Other    3,234     2,151    3,462    9,054      7,193
Total interest income    170,181     173,818    164,052    516,560      478,007
Interest expense               
Deposits    22,753     23,693    20,205    69,643      52,824
Short-term and long-term borrowings    4,347     4,512    2,589    13,134      2,850
Total interest expense    27,100     28,205    22,794    82,777      55,674
Net interest income    143,081     145,613     141,258    433,783      422,333
Provision for loan and lease losses    —     3,870    4,460    9,550      16,430
Net interest income after provision for loan and lease losses    143,081     141,743    136,798    424,233      405,903
Noninterest income               
Service charges on deposit accounts    8,554     8,123    7,933    24,737      23,609
Credit and debit card fees    16,839     16,629    16,535    50,123      48,961
Other service charges and fees    8,903     9,403    9,578    27,435      28,553
Trust and investment services income    8,698     8,931    7,487    26,247      23,429
Bank-owned life insurance    5,743     3,390    3,692    12,946      8,131
Investment securities gains (losses), net    —     21    —    (2,592)    —
Other    1,243     2,276    2,180    6,929      13,219
Total noninterest income    49,980     48,773    47,405    145,825      145,902
Noninterest expense               
Salaries and employee benefits    44,955     42,185    41,959    132,000      125,755
Contracted services and professional fees    14,649     14,303    11,478    42,597      36,770
Occupancy    7,250     7,286    6,757    21,522      20,149
Equipment    4,024     4,544    4,181    12,852      13,104
Regulatory assessment and fees    1,992     2,149    3,966    5,588      12,164
Advertising and marketing    1,647     1,980    1,060    5,593      3,126
Card rewards program    6,930     7,664    5,805    21,326      17,882
Other    12,019     13,179    17,941    37,901      46,649
Total noninterest expense    93,466     93,290    93,147    279,379      275,599
Income before provision for income taxes    99,595     97,226    91,056    290,679      276,206
Provision for income taxes    25,396     24,793    23,668    74,123      71,807
Net income $  74,199  $  72,433 $  67,388 $  216,556   $  204,399
Basic earnings per share $  0.56  $   0.54 $  0.50 $  1.62   $  1.48
Diluted earnings per share $  0.56  $  0.54 $  0.50 $  1.61   $  1.48
Basic weighted-average outstanding shares    132,583,902     134,420,380    135,466,669    133,957,192      137,643,005
Diluted weighted-average outstanding shares    132,877,769     134,652,008    135,675,498    134,231,762      137,809,573
                 


Consolidated Balance Sheets Table 3
  September 30,  June 30,  December 31,  September 30, 
(dollars in thousands) 2019 2019 2018 2018
Assets            
Cash and due from banks $358,863   $423,802  $396,836  $350,967 
Interest-bearing deposits in other banks  985,154    259,713   606,801   348,526 
Investment securities  4,157,082    4,395,476   4,498,342   4,595,301 
Loans held for sale  1,594    215   432    
Loans and leases  12,843,396    13,264,609   13,076,191   12,600,464 
Less: allowance for loan and lease losses  132,964    138,535   141,718   141,250 
Net loans and leases  12,710,432    13,126,074   12,934,473   12,459,214 
             
Premises and equipment, net  315,309    313,200   304,996   286,374 
Other real estate owned and repossessed personal property  82       751   362 
Accrued interest receivable  44,671    49,205   48,920   49,407 
Bank-owned life insurance  453,410    450,722   446,076   444,987 
Goodwill  995,492    995,492   995,492   995,492 
Mortgage servicing rights  13,630    14,573   16,155   16,937 
Other assets  562,501    497,895   446,404   436,271 
Total assets $20,598,220   $20,526,367  $20,695,678  $19,983,838 
Liabilities and Stockholders' Equity            
Deposits:            
Interest-bearing $11,136,424   $11,028,921  $11,142,127  $10,881,918 
Noninterest-bearing  5,720,822    5,763,157   6,007,941   5,807,355 
Total deposits  16,857,246    16,792,078   17,150,068   16,689,273 
Short-term borrowings  400,000    200,000      30,000 
Long-term borrowings  200,018    400,028   600,026   400,026 
Retirement benefits payable  128,442    128,610   127,909   135,523 
Other liabilities  357,956    346,210   292,836   305,554 
Total liabilities  17,943,662    17,866,926   18,170,839   17,560,376 
             
Stockholders' equity            
Common stock ($0.01 par value; authorized 300,000,000 shares; issued/outstanding: 139,908,699 / 131,260,900 shares as of September 30, 2019, issued/outstanding: 139,857,673 / 133,508,212 shares as of June 30, 2019, issued/outstanding: 139,656,674 / 134,874,302 shares as of December 31, 2018 and issued/outstanding: 139,655,841 / 134,873,728 shares as of September 30, 2018)             1,399    1,399   1,397   1,397 
Additional paid-in capital  2,501,324    2,499,946   2,495,853   2,494,436 
Retained earnings  403,317    363,748   291,919   264,463 
Accumulated other comprehensive loss, net  (18,774)  (31,984)  (132,195)  (204,699)
Treasury stock (8,647,799 shares as of September 30, 2019, 6,349,461 shares as of June 30, 2019, 4,782,372 shares as of December 31, 2018 and 4,782,113 shares as of September 30, 2018)  (232,708)  (173,668)  (132,135)  (132,135)
Total stockholders' equity  2,654,558    2,659,441   2,524,839   2,423,462 
Total liabilities and stockholders' equity $20,598,220   $20,526,367  $20,695,678  $19,983,838 
                 


Average Balances and Interest Rates                       Table 4  
  Three Months Ended  Three Months Ended  Three Months Ended  
  September 30, 2019 June 30, 2019 September 30, 2018 
   Average   Income/   Yield/   Average   Income/   Yield/   Average   Income/   Yield/  
(dollars in millions)  Balance   Expense   Rate   Balance   Expense   Rate   Balance   Expense   Rate  
Earning Assets                         
Interest-Bearing Deposits in Other Banks $  447.8  $  2.3    2.02 $  247.2 $  1.4   2.35$  656.7 $  3.3   1.99%
Available-for-Sale Investment Securities    4,296.3     22.3    2.07     4,438.1    24.8   2.23    4,737.3    25.2   2.11 
Loans Held for Sale    1.4     —    2.36     0.7    —   2.76    1.8    —   3.83 
Loans and Leases(1)                         
Commercial and industrial    2,885.9     30.0    4.12     3,235.0    34.3   4.26    3,019.9    31.0   4.08 
Commercial real estate    3,294.7     37.3    4.49     3,094.4    36.0   4.67    2,975.3    31.0   4.13 
Construction    477.2     5.6    4.67     583.6    6.9   4.73    629.5    6.7   4.20 
Residential:                         
Residential mortgages    3,644.9     38.6    4.23     3,581.2    37.2   4.16    3,288.4    34.9   4.21 
Home equity lines    912.8     8.6    3.74     908.5    8.6   3.79    870.6    8.2   3.72 
Consumer    1,651.4     23.3    5.61     1,657.7    22.7   5.48    1,649.7    22.4   5.39 
Lease financing    165.4     1.3    3.14     149.3    1.2   3.31    162.3    1.2   3.00 
Total Loans and Leases    13,032.3     144.7    4.41     13,209.7    146.9   4.46    12,595.7    135.4   4.26 
Other Earning Assets    84.8     0.9    4.47     76.0    0.7   3.71    50.0    0.2   1.29 
Total Earning Assets(2)    17,862.6     170.2    3.79     17,971.7    173.8   3.88    18,041.5    164.1   3.61 
Cash and Due from Banks    341.7          342.6         336.5      
Other Assets    2,128.2          2,076.0         2,013.5      
Total Assets $  20,332.5       $  20,390.3      $  20,391.5      
                          
Interest-Bearing Liabilities                         
Interest-Bearing Deposits                         
Savings $  4,891.5  $  4.6    0.37 $  4,712.2 $  4.0   0.34   4,727.2 $  3.3   0.28%
Money Market    3,067.4     7.1    0.92     3,126.7    7.4   0.95    2,871.0    4.6   0.63 
Time    2,872.6     11.1    1.54     3,084.6    12.3   1.60    3,705.7    12.3   1.32 
Total Interest-Bearing Deposits    10,831.5     22.8    0.83     10,923.5    23.7   0.87    11,303.9    20.2   0.71 
Short-Term Borrowings    370.0     2.6    2.84     50.4    0.3   2.25    3.3    —   1.30 
Long-Term Borrowings    239.1     1.7    2.82     593.5    4.2   2.86    358.7    2.6   2.85 
Total Interest-Bearing Liabilities    11,440.6     27.1    0.94     11,567.4    28.2   0.98    11,665.9    22.8   0.78 
Net Interest Income    $  143.1       $  145.6      $  141.3   
Interest Rate Spread         2.85         2.90        2.83%
Net Interest Margin         3.19         3.25        3.11%
Noninterest-Bearing Demand Deposits    5,742.3          5,741.3         5,854.9      
Other Liabilities    501.2          471.0         442.8      
Stockholders' Equity    2,648.4          2,610.6         2,427.9      
Total Liabilities and Stockholders' Equity $  20,332.5       $  20,390.3      $  20,391.5      
                          


Average Balances and Interest Rates                Table 5  
  Nine Months Ended  Nine Months Ended  
  September 30, 2019 September 30, 2018 
   Average   Income/   Yield/   Average   Income/   Yield/  
(dollars in millions)  Balance   Expense   Rate   Balance   Expense   Rate  
Earning Assets                 
Interest-Bearing Deposits in Other Banks $  400.6  $  6.9    2.31 $  518.4 $  6.9   1.77%
Available-for-Sale Investment Securities    4,383.6     71.5    2.18     4,951.4    81.6   2.20 
Loans Held for Sale    0.8     —    2.52     1.3    —   3.60 
Loans and Leases(1)                 
Commercial and industrial    3,094.8     97.5    4.21     3,100.1    89.2   3.85 
Commercial real estate    3,129.8     108.1    4.62     2,886.7    86.3   4.00 
Construction    565.2     20.0    4.73     623.9    18.6   4.00 
Residential:                 
Residential mortgages    3,590.2     112.4    4.17     3,221.7    102.4   4.25 
Home equity lines    912.4     25.9    3.79     864.0    23.6   3.65 
Consumer    1,658.7     68.5    5.52     1,625.0    65.5   5.38 
Lease financing    154.0     3.6    3.15     161.3    3.6   2.98 
Total Loans and Leases    13,105.1     436.0    4.44     12,482.7    389.2   4.17 
Other Earning Assets    84.3     2.2    3.37     28.6    0.3   1.58 
Total Earning Assets(2)    17,974.4     516.6    3.84     17,982.4    478.0   3.55 
Cash and Due from Banks    348.1          324.4      
Other Assets    2,082.8          2,000.0      
Total Assets $  20,405.3       $  20,306.8      
                  
Interest-Bearing Liabilities                 
Interest-Bearing Deposits                 
Savings $  4,806.0  $  12.8    0.35 $  4,615.1 $  7.4   0.21%
Money Market    3,125.5     22.1    0.95     2,769.9    9.1   0.44 
Time    2,999.0     34.8    1.55     3,985.2    36.3   1.22 
Total Interest-Bearing Deposits    10,930.5     69.7    0.85     11,370.2    52.8   0.62 
Short-Term Borrowings    145.7     3.0    2.76     15.3    0.2   1.81 
Long-Term Borrowings    476.2     10.1    2.84     123.1    2.7   2.87 
Total Interest-Bearing Liabilities    11,552.4     82.8    0.96     11,508.6    55.7   0.65 
Net Interest Income    $  433.8       $  422.3   
Interest Rate Spread         2.88         2.90%
Net Interest Margin         3.22         3.14%
Noninterest-Bearing Demand Deposits    5,769.9          5,916.0      
Other Liabilities    482.7          417.6      
Stockholders' Equity    2,600.3          2,464.6      
Total Liabilities and Stockholders' Equity $  20,405.3       $  20,306.8      
                  


Analysis of Change in Net Interest Income         Table 6
  Three Months Ended September 30, 2019
  Compared to June 30, 2019
(dollars in millions)  Volume   Rate  Total
Change in Interest Income:         
Interest-Bearing Deposits in Other Banks $  1.1   $  (0.2) $  0.9  
Available-for-Sale Investment Securities    (0.8)    (1.7)    (2.5)
Loans and Leases         
Commercial and industrial    (3.3)    (1.0)    (4.3)
Commercial real estate    2.6      (1.3)    1.3  
Construction    (1.2)    (0.1)    (1.3)
Residential:         
Residential mortgage    0.7      0.7      1.4  
Home equity line    0.1      (0.1)    —  
Consumer    (0.1)    0.7      0.6  
Lease financing    0.1      —      0.1  
Total Loans and Leases    (1.1)    (1.1)    (2.2)
Other Earning Assets    0.1      0.1      0.2  
Total Change in Interest Income    (0.7)    (2.9)    (3.6)
          
Change in Interest Expense:         
Interest-Bearing Deposits         
Savings    0.2      0.4      0.6  
Money Market    (0.1)    (0.2)    (0.3)
Time    (0.8)    (0.4)    (1.2)
Total Interest-Bearing Deposits    (0.7)    (0.2)    (0.9)
Short-Term Borrowings    2.3      —      2.3  
Long-Term Borrowings    (2.5)    —      (2.5)
Total Change in Interest Expense    (0.9)    (0.2)    (1.1)
Change in Net Interest Income $  0.2   $  (2.7) $  (2.5)


Analysis of Change in Net Interest Income         Table 7
  Three Months Ended September 30, 2019
  Compared to September 30, 2018
(dollars in millions)  Volume   Rate  Total
Change in Interest Income:         
Interest-Bearing Deposits in Other Banks $  (1.0) $  —   $  (1.0)
Available-for-Sale Investment Securities    (2.4)    (0.5)    (2.9)
Loans and Leases         
Commercial and industrial    (1.4)    0.4      (1.0)
Commercial real estate    3.5      2.8      6.3  
Construction    (1.7)    0.6      (1.1)
Residential:         
Residential mortgage    3.5      0.2      3.7  
Home equity line    0.4      —      0.4  
Consumer    —      0.9      0.9  
Lease financing    —      0.1      0.1  
Total Loans and Leases    4.3      5.0      9.3  
Other Earning Assets    0.1      0.6      0.7  
Total Change in Interest Income    1.0      5.1      6.1  
          
Change in Interest Expense:         
Interest-Bearing Deposits         
Savings    0.1      1.2      1.3  
Money Market    0.3      2.2      2.5  
Time    (3.0)    1.8      (1.2)
Total Interest-Bearing Deposits    (2.6)    5.2      2.6  
Short-Term Borrowings    2.6      —      2.6  
Long-Term Borrowings    (0.9)    —      (0.9)
Total Change in Interest Expense    (0.9)    5.2      4.3  
Change in Net Interest Income $  1.9   $  (0.1) $  1.8  
             


Analysis of Change in Net Interest Income         Table 8
  Nine Months Ended September 30, 2019
  Compared to September 30, 2018
(dollars in millions)  Volume   Rate  Total
Change in Interest Income:         
Interest-Bearing Deposits in Other Banks $  (1.8) $  1.8   $  —  
Available-for-Sale Investment Securities    (9.2)    (0.9)    (10.1)
Loans and Leases         
Commercial and industrial    (0.2)    8.5      8.3  
Commercial real estate    7.7      14.1      21.8  
Construction    (1.8)    3.2      1.4  
Residential:         
Residential mortgage    11.9      (1.9)    10.0  
Home equity line    1.4      0.9      2.3  
Consumer    1.3      1.7      3.0  
Lease financing    (0.2)    0.2      —  
Total Loans and Leases    20.1      26.7      46.8  
Other Earning Assets    1.2      0.7      1.9  
Total Change in Interest Income    10.3      28.3      38.6  
          
Change in Interest Expense:         
Interest-Bearing Deposits         
Savings    0.3      5.1      5.4  
Money Market    1.3      11.7      13.0  
Time    (10.1)    8.6      (1.5)
Total Interest-Bearing Deposits    (8.5)    25.4      16.9  
Short-Term Borrowings    2.6      0.2      2.8  
Long-Term Borrowings    7.5      (0.1)    7.4  
Total Change in Interest Expense    1.6      25.5      27.1  
Change in Net Interest Income $  8.7   $  2.8   $  11.5  
             


Loans and Leases           Table 9
  September 30,  June 30,  December 31,  September 30, 
(dollars in thousands) 2019 2019 2018 2018
Commercial and industrial $  2,654,077   $  3,177,844  $  3,208,760  $  2,969,237
Commercial real estate    3,309,389     3,194,219    2,990,783    2,891,753
Construction    486,977     549,578    626,757    612,794
Residential:            
Residential mortgage    3,671,424     3,618,433    3,527,101    3,423,115
Home equity line    916,106     908,452    912,517    890,374
Total residential    4,587,530     4,526,885    4,439,618    4,313,489
Consumer    1,637,549     1,650,713    1,662,504    1,651,877
Lease financing    167,874     165,370    147,769    161,314
Total loans and leases $  12,843,396  $  13,264,609 $  13,076,191 $  12,600,464
             


Deposits           Table 10
  September 30,  June 30,  December 31,  September 30, 
(dollars in thousands) 2019 2019 2018 2018
Demand $  5,720,822  $5,763,157 $6,007,941 $5,807,355
Savings    4,899,468   4,908,000  4,853,285  4,685,460
Money Market    3,529,363   3,050,843  3,196,678  2,905,959
Time    2,707,593   3,070,078  3,092,164  3,290,499
  Total Deposits $  16,857,246  $16,792,078 $17,150,068 $16,689,273
             


Non-Performing Assets and Accruing Loans and Leases Past Due 90 Days or More           Table 11
  September 30,  June 30,  December 31,  September 30, 
(dollars in thousands) 2019 2019 2018 2018
Non-Performing Assets            
Non-Accrual Loans and Leases            
Commercial Loans:            
Commercial and industrial $  12  $  119 $  274 $  481
Commercial real estate    33     —    1,658    2,786
Construction    —     —    —    2,001
Total Commercial Loans    45     119    1,932    5,268
Residential Loans:            
Residential mortgage    3,959     3,771    4,611    5,678
Total Residential Loans    3,959     3,771    4,611    5,678
Consumer    200     —    —    —
Total Non-Accrual Loans and Leases    4,204     3,890    6,543    10,946
Other Real Estate Owned    82     —    751    362
Total Non-Performing Assets $  4,286  $  3,890 $  7,294 $  11,308
              
Accruing Loans and Leases Past Due 90 Days or More             
Commercial Loans:            
Commercial and industrial $  750  $  807 $  141 $  141
Construction    —     —    —    172
Total Commercial Loans    750     807    141    313
Residential Loans:            
Residential mortgage    139     —    32    168
Home equity line    3,192     1,635    2,842    2,620
Total Residential Loans    3,331     1,635    2,874    2,788
Consumer    3,076     3,295    3,373    2,813
Total Accruing Loans and Leases Past Due 90 Days or More $  7,157  $  5,737 $  6,388 $  5,914
             
Restructured Loans on Accrual Status and Not Past Due 90 Days or More    22,350     23,466    24,033    28,608
Total Loans and Leases  $  12,843,396  $  13,264,609 $  13,076,191 $  12,600,464
             


Allowance for Loan and Lease Losses              Table 12
  For the Three Months Ended  For the Nine Months Ended
  September 30,  June 30,  September 30,  September 30,  September 30, 
(dollars in thousands) 2019 2019 2018 2019 2018
Balance at Beginning of Period $  138,535   $141,546  $140,601  $  141,718   $137,253 
Loans and Leases Charged-Off               
Commercial Loans:               
Commercial and industrial    (514)  (2,000)  (303)    (2,514)  (778)
Lease financing    —            (24)   
Total Commercial Loans    (514)  (2,000)  (303)    (2,538)  (778)
Residential    (7)     (125)    (7)  (159)
Consumer    (8,015)  (7,505)  (5,700)    (24,118)  (18,615)
Total Loans and Leases Charged-Off    (8,536)  (9,505)  (6,128)    (26,663)  (19,552)
Recoveries on Loans and Leases Previously Charged-Off                 
Commercial Loans:               
Commercial and industrial    241    25   51     303    154 
Commercial real estate    30    32   21     93    175 
Total Commercial Loans    271    57   72     396    329 
Residential    425    185   442     860    684 
Consumer    2,269    2,382   1,803     7,103    6,106 
Total Recoveries on Loans and Leases Previously Charged-Off    2,965    2,624   2,317     8,359    7,119 
Net Loans and Leases Charged-Off    (5,571)  (6,881)  (3,811)    (18,304)  (12,433)
Provision for Loan and Lease Losses    —    3,870   4,460     9,550    16,430 
Balance at End of Period $  132,964   $138,535  $141,250  $  132,964   $141,250 
Average Loans and Leases Outstanding $  13,032,349   $13,209,655  $12,595,668  $  13,105,086   $12,482,747 
Ratio of Net Loans and Leases Charged-Off to Average Loans and Leases Outstanding    0.17 % 0.21% 0.12%   0.19 % 0.13%
Ratio of Allowance for Loan and Lease Losses to Loans and Leases Outstanding    1.04 % 1.04% 1.12%   1.04 % 1.12%
                 


GAAP to Non-GAAP Reconciliation          Table 13 
  For the Three Months Ended  For the Nine Months Ended  
  September 30,  June 30,  September 30,  September 30,  
(dollars in thousands, except per share amounts) 2019  2019 2018 2019  2018 
Income Statement Data:                
Net income $  74,199  $  72,433 $  67,388 $  216,556  $  204,399 
Core net income $  75,871  $  72,612 $  70,818 $  220,535  $  208,797 
                 
Average total stockholders' equity $  2,648,428  $  2,610,565 $  2,427,907 $  2,600,259  $  2,464,601 
Less: average goodwill    995,492     995,492    995,492    995,492     995,492 
Average tangible stockholders' equity $  1,652,936  $  1,615,073 $   1,432,415 $  1,604,767  $  1,469,109 
                 
Average total assets $  20,332,457  $  20,390,273 $  20,391,456 $  20,405,261  $  20,306,833 
Less: average goodwill    995,492     995,492    995,492    995,492     995,492 
Average tangible assets $  19,336,965  $  19,394,781 $  19,395,964 $  19,409,769  $  19,311,341 
                 
Return on average total stockholders' equity(1)    11.12    11.13   11.01   11.13    11.09
Core return on average total stockholders' equity (non-GAAP)(1)    11.37    11.16   11.57   11.34    11.33
Return on average tangible stockholders' equity (non-GAAP)(1)    17.81    17.99   18.66   18.04    18.60
Core return on average tangible stockholders' equity (non-GAAP)(1)    18.21    18.03   19.61   18.37    19.00
                 
Return on average total assets(1)    1.45    1.42   1.31   1.42    1.35
Core return on average total assets (non-GAAP)(1)    1.48    1.43   1.38   1.44    1.37
Return on average tangible assets (non-GAAP)(1)    1.52    1.50   1.38   1.49    1.42
Core return on average tangible assets (non-GAAP)(1)    1.56    1.50   1.45   1.52    1.45
                 
      As of   As of   As of   As of  
     September 30,  June 30,  December 31,  September 30,  
     2019 2019 2018 2018 
Balance Sheet Data:                
Total stockholders' equity    $  2,654,558  $  2,659,441 $  2,524,839 $  2,423,462 
Less: goodwill       995,492     995,492    995,492    995,492 
Tangible stockholders' equity    $  1,659,066  $  1,663,949 $  1,529,347 $  1,427,970 
                 
Total assets    $  20,598,220  $  20,526,367 $  20,695,678 $  19,983,838 
Less: goodwill       995,492     995,492    995,492    995,492 
Tangible assets    $  19,602,728  $  19,530,875 $  19,700,186 $  18,988,346 
                 
Shares outstanding       131,260,900     133,508,212    134,874,302    134,873,728 
                 
Total stockholders' equity to total assets       12.89    12.96   12.20   12.13%
Tangible stockholders' equity to tangible assets (non-GAAP)       8.46    8.52   7.76   7.52%
                 
Book value per share    $  20.22  $  19.92 $  18.72 $  17.97 
Tangible book value per share (non-GAAP)    $  12.64  $  12.46 $  11.34 $  10.59 
                 


GAAP to Non-GAAP Reconciliation              Table 14
  For the Three Months Ended For the Nine Months Ended
  September 30,  June 30,  September 30,  September 30, 
(dollars in thousands, except per share amounts) 2019 2019 2018 2019 2018
Net interest income $  143,081   $  145,613  $  141,258  $  433,783   $  422,333 
Core net interest income (non-GAAP) $  143,081   $  145,613  $  141,258  $  433,783   $  422,333 
                
Noninterest income $  49,980   $  48,773  $  47,405  $  145,825   $  145,902 
(Gain) loss on sale of securities    —      (21)    —     2,592      — 
Core noninterest income (non-GAAP) $  49,980   $  48,752  $  47,405  $  148,417   $  145,902 
                
Noninterest expense $  93,466   $  93,290  $  93,147  $  279,379   $  275,599 
Loss on litigation settlement(1)    —      —     (4,125)    —      (4,125)
One-time items(2)    (2,244)    (261)    (511)    (2,766)    (1,832)
Core noninterest expense (non-GAAP) $  91,222   $  93,029  $  88,511  $  276,613   $  269,642 
                
Net income $  74,199   $  72,433  $  67,388  $  216,556   $  204,399 
(Gain) loss on sale of securities    —      (21)    —     2,592      — 
Loss on litigation settlement(1)    —      —     4,125     —      4,125 
One-time noninterest expense items(2)    2,244      261     511     2,766      1,832 
Tax adjustments(3)    (572)    (61)    (1,206)    (1,379)    (1,559)
Total core adjustments    1,672      179     3,430     3,979      4,398 
Core net income (non-GAAP) $  75,871   $  72,612  $  70,818  $  220,535   $  208,797 
                
Basic earnings per share $  0.56   $  0.54  $  0.50  $   1.62   $  1.48 
Diluted earnings per share $  0.56   $  0.54  $  0.50  $  1.61   $  1.48 
Efficiency ratio    48.41 %    47.99%    49.36%    48.20 %    48.49%
                
Core basic earnings per share (non-GAAP) $  0.57   $  0.54  $  0.52  $  1.65   $  1.52 
Core diluted earnings per share (non-GAAP) $  0.57   $  0.54  $  0.52  $  1.64   $  1.52 
Core efficiency ratio (non-GAAP)    47.25 %    47.86%    46.90%    47.51 %    47.44%