GREENVILLE, S.C., April 24, 2024 (GLOBE NEWSWIRE) -- United Community Banks, Inc. (NASDAQ:UCBI) (United) today announced that net income for the first quarter was $62.6 million and pre-tax, pre-provision income was $93.7 million. Diluted earnings per share of $0.51 for the quarter represented a decrease of $0.01 or 2%, from the first quarter a year ago and an increase of $0.40 from the fourth quarter of 2023, during which merger charges, losses from a bond portfolio restructuring, and an FDIC special assessment had a significant negative impact on earnings. On an operating basis, diluted earnings per share of $0.52 were slightly lower compared to last quarter, with the primary drivers of the decrease being a seasonal increase in certain operating expenses and a higher effective tax rate, as well as a lower day count. These were offset by a favorable MSR asset write-up and lower provision expense. Core deposits, excluding brokered deposits and public funds, grew by 5% annualized and loans grew at a 1.2% annualized rate during the quarter. Net interest revenue was lower by 2% during the quarter despite an increase in average loan balances, as lower average interest-earning assets and a lower day count offset the effect of a higher margin. For the first quarter, United's return on assets was 0.90% and 0.93% on an operating basis. Return on equity was 7.14% and return on tangible common equity was 10.68%. On a pre-tax, pre-provision basis, operating return on assets was 1.40% for the quarter. At quarter-end, tangible common equity to tangible assets was 8.49%, up 13 basis points from the fourth quarter of 2023. Chairman and CEO Lynn Harton stated, "We reported solid results in the first quarter, with strong pre-tax, pre-provision earnings, a stable margin, and good credit performance. Loan growth slowed as expected while core deposit growth was stronger than we anticipated." Harton continued "Economic conditions in our markets continue to be very positive. However, we are mindful of the uncertainties in the environment, such as continuing inflation, the tension between a very tight monetary policy and a very loose fiscal policy, and ongoing global conflicts. Given those uncertainties, we continue to manage conservatively so that we can remain a source of strength for our communities and customers." United's net interest margin increased by 1 basis point to 3.20% from the fourth quarter. Interest-earning assets were modestly lower and the average yield on United's interest-earning assets was up 8 basis points to 5.39%, and its cost of interest-bearing liabilities increased by 7 basis points to 3.23%, contributing to the increase in the net interest margin. Cost of deposits, including non-interest-bearing deposits was 2.32%. Net charge-offs were $12.9 million or 0.28% of average loans during the quarter, up 6 basis points compared to the fourth quarter of 2023, and NPAs were 39 basis points relative to total assets, up 5 basis points from the previous quarter. Mr. Harton concluded, "We approach 2024 with continued optimism given the strength of our company, driven by an outstanding team of employees. In the first quarter, we became a 10-time winner of the JD Power Award for Best Retail Banking Satisfaction in the Southeast. We also received 15 Greenwich Excellence Awards for Small Business Banking. These awards reflect the passion and skill that our teams exhibit every day in the quest to serve our customers in the best way possible." First Quarter 2024 Financial Highlights: Net income of $62.6 million and pre-tax, pre-provision income of $93.7 million EPS decreased by 2% compared to first quarter 2023 on a GAAP basis and 10% on an operating basis; compared to fourth quarter 2023, EPS increased 364% on a GAAP basis and decreased 2% on an operating basis Return on assets of 0.90%, or 0.93% on an operating basis Pre-tax, pre-provision return on assets of 1.40% on an operating basis Return on common equity of 7.14% Return on tangible common equity of 10.68% on an operating basis A provision for credit losses of $12.9 million, which increased the allowance for loan losses to 1.15% of loans from 1.14% in the fourth quarter Loan production of $881 million, resulting in loan growth of 1.2% annualized for the quarter Core deposits, excluding brokered deposits and public funds, grew by 5% annualized Net interest margin of 3.20% increased by 1 basis point from the fourth quarter Mortgage closings of $171 million compared to $225 million a year ago; mortgage rate locks of $260 million compared to $335 million a year ago Noninterest income was up $62.7 million on a linked quarter basis, primarily driven by the $51.7 million bond portfolio restructuring charge in the fourth quarter. Mortgage Loan and Related Fees were $7.5 million, which was $5.6 million higher compared to the fourth quarter, largely attributable to a favorable mortgage servicing rights asset write-up compared to a write-down last quarter Noninterest expenses decreased by $9.6 million compared to the fourth quarter due to lower non-operating charges including merger-related charges and the FDIC special assessment Efficiency ratio of 60.5%, or 59.2% on an operating basis Net charge-offs of $12.9 million, or 28 basis points as a percent of average loans, up 6 basis points from the net charge-offs level experienced in the fourth quarter Nonperforming assets of 0.39% of total assets, up 5 basis points compared to December 31, 2023 Quarterly common shareholder dividend of $0.23 per share declared during the quarter, which was flat year-over-year Conference Call United will hold a conference call on Wednesday, April 24, 2024, at 11 a.m. ET 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/10187792/fc12c215d0. 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)                               2024    2023    First Quarter       First Quarter   Fourth Quarter   Third Quarter   Second Quarter   First Quarter   2024 - 2023Change INCOME SUMMARY                           Interest revenue   $336,728   $338,698   $323,147   $295,775   $279,487       Interest expense   137,579   135,245   120,591   95,489   68,017       Net interest revenue   199,149   203,453   202,556   200,286   211,470   (6)%   Provision for credit losses   12,899   14,626   30,268   22,753   21,783       Noninterest income   39,587   (23,090)   31,977   36,387   30,209   31   Total revenue   225,837   165,737   204,265   213,920   219,896   3   Noninterest expenses   145,002   154,587   144,474   132,407   139,805   4   Income before income tax expense   80,835   11,150   59,791   81,513   80,091   1   Income tax expense   18,204   (2,940)   11,925   18,225   17,791   2   Net income   62,631   14,090   47,866   63,288   62,300   1   Non-operating items   2,187   67,450   9,168   3,645   8,631       Income tax benefit of non-operating items   (493)   (16,714)   (2,000)   (820)   (1,955)       Net income - operating (1)   $64,325   $64,826   $55,034   $66,113   $68,976   (7)   Pre-tax pre-provision income (5)   $93,734   $25,776   $90,059   $104,266   $101,874   (8)   PERFORMANCE MEASURES                           Per common share:                           Diluted net income - GAAP   $0.51   $0.11   $0.39   $0.53   $0.52   (2)   Diluted net income - operating (1)   0.52   0.53   0.45   0.55   0.58   (10)   Cash dividends declared   0.23   0.23   0.23   0.23   0.23   —   Book value   26.83   26.52   25.87   25.98   25.76   4   Tangible book value (3)   18.71   18.39   17.70   17.83   17.59   6   Key performance ratios:                           Return on common equity - GAAP (2)(4)   7.14%   1.44%   5.32%   7.47%   7.34%       Return on common equity - operating (1)(2)(4)   7.34   7.27   6.14   7.82   8.15       Return on tangible common equity - operating (1)(2)(3)(4)   10.68   10.58   9.03   11.35   11.63       Return on assets - GAAP (4)   0.90   0.18   0.68   0.95   0.95       Return on assets - operating (1)(4)   0.93   0.92   0.79   1.00   1.06       Return on assets - pre-tax pre-provision - operating (1)(4)(5)   1.40   1.33   1.44   1.65   1.71       Net interest margin (fully taxable equivalent) (4)   3.20   3.19   3.24   3.37   3.61       Efficiency ratio - GAAP   60.47   66.33   61.32   55.71   57.20       Efficiency ratio - operating (1)   59.15   59.57   57.43   54.17   53.67       Equity to total assets   12.06   11.95   11.85   11.89   11.90       Tangible common equity to tangible assets (3)   8.49   8.36   8.18   8.21   8.17       ASSET QUALITY                           Nonperforming assets ("NPAs")   $107,230   $92,877   $90,883   $103,737   $73,403   46   Allowance for credit losses - loans   210,934   208,071   201,557   190,705   176,534   19   Allowance for credit losses - total   224,119   224,128   219,624   212,277   197,923   13   Net charge-offs   12,908   10,122   26,638   8,399   7,084       Allowance for credit losses - loans to loans   1.15%   1.14%   1.11%   1.10%   1.03%       Allowance for credit losses - total to loans   1.22   1.22   1.21   1.22   1.16       Net charge-offs to average loans (4)   0.28   0.22   0.59   0.20   0.17       NPAs to total assets   0.39   0.34   0.34   0.40   0.28       AT PERIOD END ($ in millions)                           Loans   $18,375   $18,319   $18,203   $17,395   $17,125   7   Investment securities   5,859   5,822   5,701   5,914   5,915   (1)   Total assets   27,365   27,297   26,869   26,120   25,872   6   Deposits   23,332   23,311   22,858   22,252   22,005   6   Shareholders' equity   3,300   3,262   3,184   3,106   3,078   7   Common shares outstanding (thousands)   119,137   119,010   118,976   115,266   115,152   3     (1) Excludes non-operating items as detailed on Non-GAAP Performance Measures Reconciliation on next page. (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 (in thousands, except per share data)                           2024       2023       First Quarter   Fourth Quarter   Third Quarter   Second Quarter   First Quarter Net income to operating income reconciliation                     Net income (GAAP)   $ 62,631     $ 14,090     $ 47,866     $ 63,288     $ 62,300   Bond portfolio restructuring loss     —       51,689       —       —       —   Gain on lease termination     (2,400 )     —       —       —       —   FDIC special assessment     2,500       9,995       —       —       —   Merger-related and other charges     2,087       5,766       9,168       3,645       8,631   Income tax benefit of non-operating items     (493 )     (16,714 )     (2,000 )     (820 )     (1,955 ) Net income - operating   $ 64,325     $ 64,826     $ 55,034     $ 66,113     $ 68,976                         Net income to pre-tax pre-provision income reconciliation                     Net income (GAAP)   $ 62,631     $ 14,090     $ 47,866     $ 63,288     $ 62,300   Income tax expense     18,204       (2,940 )     11,925       18,225       17,791   Provision for credit losses     12,899       14,626       30,268       22,753       21,783   Pre-tax pre-provision income   $ 93,734     $ 25,776     $ 90,059     $ 104,266     $ 101,874                         Diluted income per common share reconciliation                     Diluted income per common share (GAAP)   $ 0.51     $ 0.11     $ 0.39     $ 0.53     $ 0.52   Bond portfolio restructuring loss     —       0.32       —       —       —   Gain on lease termination     (0.02 )     —       —       —       —   FDIC special assessment     0.02       0.06       —       —       —   Merger-related and other charges     0.01       0.04       0.06       0.02       0.06   Diluted income per common share - operating   $ 0.52     $ 0.53     $ 0.45     $ 0.55     $ 0.58                         Book value per common share reconciliation                     Book value per common share (GAAP)   $ 26.83     $ 26.52     $ 25.87     $ 25.98     $ 25.76   Effect of goodwill and other intangibles     (8.12 )     (8.13 )     (8.17 )     (8.15 )     (8.17 ) Tangible book value per common share   $ 18.71     $ 18.39     $ 17.70     $ 17.83     $ 17.59                         Return on tangible common equity reconciliation                     Return on common equity (GAAP)     7.14 %     1.44 %     5.32 %     7.47 %     7.34 % Bond portfolio restructuring loss     —       4.47       —       —       —   Gain on lease termination     (0.22 )     —       —       —       —   FDIC special assessment     0.23       0.86       —       —       —   Merger-related and other charges     0.19       0.50       0.82       0.35       0.81   Return on common equity - operating     7.34       7.27       6.14       7.82       8.15   Effect of goodwill and other intangibles     3.34       3.31       2.89       3.53       3.48   Return on tangible common equity - operating     10.68 %     10.58 %     9.03 %     11.35 %