COLUMBIA BANKING SYSTEM, INC. REPORTS THIRD QUARTER 2024 RESULTS
TACOMA, Wash., Oct. 24, 2024 /PRNewswire/ --
$146 million
$143 million
$0.70
$0.69
Net income
Operating net income 1
Earnings per diluted commonshare
Operating earnings per dilutedcommon share 1
CEO Commentary
"Our third quarter results reflect our continued work and success as we strive toward top-quartile performance," said Clint Stein, President and CEO. "Our recurring expense run rate reflects a 25% reduction in costs over the 18 months we have operated as a combined organization, as we eliminated redundancies and streamlined operations. Our teams' dedication to driving value for our customers contributed to solid core deposit growth, even as deposit costs were reduced. Although loan balances contracted during the quarter, they reflect healthy customer activity and our focus on reducing transactional assets and their funding sources, as we regain Columbia's placement as a top-performing bank that delivers long-term, consistent, repeatable results for our shareholders."
–Clint Stein, President and CEO of Columbia Banking System, Inc.
_____________________________
1 "Non-GAAP" financial measure. See GAAP to Non-GAAP Reconciliation for additional information.
3Q24 HIGHLIGHTS (COMPARED TO 2Q24)
Net InterestIncome and NIM
• Net interest income increased by $3 million from the prior quarter due to higher income earned on loans, which occurred despite a reduction in accretion income, and relatively stable funding costs prior to the late-quarter reduction in the federal funds rate.
• Net interest margin was 3.56%, unchanged from the prior quarter, as a favorable balance sheet funding mix shift into lower-cost deposits and a slight increase in loan yields offset a lower yield on securities.
Non-InterestIncome and Expense
• Non-interest income increased by $21 million due to the quarterly fluctuation in cumulative fair value accounting and hedges, which drove $16 million of the change. Higher core banking activity contributed to the remaining increase.
• Non-interest expense decreased by $8 million due to lower restructuring expense and a $6 million decline in salary and wages expense related to operational initiatives. The effect was partially offset by the prior quarter's reversal of compensation-related accruals, which did not repeat in the third quarter.
Credit Quality
• Net charge-offs were 0.31% of average loans and leases (annualized), compared to 0.32% in the prior quarter. Lower activity in the FinPac portfolio drove the decline.
• Provision expense of $29 million compares to $32 million in the prior quarter.
• Non-performing assets to total assets was 0.32%, compared to 0.30% as of June 30, 2024.
Capital
• Estimated total risk-based capital ratio of 12.5% and estimated common equity tier 1 risk-based capital ratio of 10.3%.
• Declared a quarterly cash dividend of $0.36 per common share on August 12, 2024, which was paid September 9, 2024.
Notable Items
• Realized $82 million in annualized cost savings associated with recent operational initiatives as of September 30, 2024. Reinvestment of $12 million in savings is ongoing and expected to extend into 2025.
• Opened our second retail branch in Arizona, which will be complemented by a planned third location in the state, slated to open in early 2025.
3Q24 KEY FINANCIAL DATA
PERFORMANCE METRICS
3Q24
2Q24
3Q23
Return on average assets
1.12 %
0.93 %
1.02 %
Return on average commonequity
11.36 %
9.85 %
11.07 %
Return on average tangible common equity 1
16.34 %
14.55 %
16.93 %
Operating return on average assets 1
1.10 %
1.08 %
1.23 %
Operating return on averagecommon equity 1
11.15 %
11.47 %
13.40 %
Operating return on averagetangible common equity 1
16.04 %
16.96 %
20.48 %
Net interest margin
3.56 %
3.56 %
3.91 %
Efficiency ratio
54.56 %
59.02 %
57.82 %
Operating efficiency ratio, asadjusted 1
53.89 %
53.56 %
51.26 %
INCOME STATEMENT
($ in 000s, excl. per share data)
3Q24
2Q24
3Q23
Net interest income
$430,218
$427,449
$480,875
Provision for credit losses
$28,769
$31,820
$36,737
Non-interest income
$66,159
$44,703
$43,981
Non-interest expense
$271,358
$279,244
$304,147
Pre-provision net revenue 1
$225,019
$192,908
$220,709
Operating pre-provision net revenue 1
$221,412
$219,390
$258,687
Earnings per common share -diluted
$0.70
$0.57
$0.65
Operating earnings per common share - diluted 1
$0.69
$0.67
$0.79
Dividends paid per share
$0.36
$0.36
$0.36
BALANCE SHEET
3Q24
2Q24
3Q23
Total assets
$51.9B
$52.0B
$52.0B
Loans and leases
$37.5B
$37.7B
$37.2B
Deposits
$41.5B
$41.5B
$41.6B
Book value per common share
$25.17
$23.76
$22.21
Tangible book value per share 1
$17.81
$16.26
$14.22
Organizational UpdateColumbia Banking System, Inc. ("Columbia," the "Company," "we," or "our") completed an enterprise-wide evaluation of our operations during the first quarter of 2024. Cost savings identified through the comprehensive review were fully realized as of September 30, 2024, with a portion reserved to fund franchise reinvestment into 2025. Planned reinvestments, some of which have already occurred, include new talent additions, opening de novo locations in targeted growth markets within our existing footprint, and investments in products and technology that create operational efficiencies and revenue growth opportunities. During the third quarter, Columbia's primary subsidiary, Umpqua Bank ("Umpqua"), added new team members with specialty focuses in three of our markets. We also announced the opening of a retail branch in Scottsdale, Arizona, which will be complemented by a planned location in Mesa, Arizona, slated to open in early 2025 as our third branch in the Phoenix metropolitan area. Please refer to the Q3 2024 Earnings Presentation for additional details on our cost savings initiatives and planned reinvestments.
On February 28, 2023, Columbia completed its merger with Umpqua Holdings Corporation ("UHC"), combining the two premier banks in the Northwest to create one of the largest banks headquartered in the West (the "merger"). Columbia's financial results for any periods ended prior to February 28, 2023 reflect UHC results only on a standalone basis. In addition, Columbia's reported financial results for the nine months ended September 30, 2023 reflect UHC financial results only until the closing of the merger after the close of business on February 28, 2023. As a result of these two factors, Columbia's financial results for the nine months ended September 30, 2024 may not be directly comparable to prior reported periods. Under the reverse acquisition method of accounting, the assets and liabilities of Columbia as of February 28, 2023 ("historical Columbia") were recorded at their respective fair values.
Net Interest IncomeNet interest income was $430 million for the third quarter of 2024, up $3 million from the prior quarter. The increase reflects higher income earned on loans, which occurred despite a reduction in accretion income, and relatively stable funding costs prior to the reduction in the federal funds rate in the latter part of September.
Columbia's net interest margin was 3.56% for the third quarter of 2024, unchanged from the second quarter of 2024. A favorable balance sheet funding mix shift into lower-cost deposits and a slight increase in loan yields offset a lower yield on securities, contributing to net interest margin stability between periods. The cost of interest-bearing deposits decreased 2 basis points from the prior quarter to 2.95% for the third quarter of 2024, which compares to 2.90% for the month of September and 2.74% as of September 30, 2024. "Anticipated seasonal deposit inflows and successful small business campaigns contributed to customer balance growth during the third quarter," commented Tory Nixon, President of Umpqua Bank. "We continue to use bundled solutions to generate lower-cost customer deposit balances, not promotional pricing. Overall deposit pricing was reduced ahead of and following the federal funds rate reduction in September."
Columbia's cost of interest-bearing liabilities decreased 2 basis points from the prior quarter to 3.29% for the third quarter of 2024, which compares to 3.26% for the month of September and 3.13% as of September 30, 2024. Please refer to the Q3 2024 Earnings Presentation for additional net interest margin change details and interest rate sensitivity information as well as to our non-GAAP disclosures in this press release for the impact of purchase accounting accretion and amortization on individual line items.
Non-interest IncomeNon-interest income was $66 million for the third quarter of 2024, up $21 million from the prior quarter. The increase was driven by quarterly fluctuations in fair value adjustments and mortgage servicing rights ("MSR") hedging activity, which collectively resulted in a net fair value gain of $7 million in the third quarter compared to a net fair value loss of $10 million in the second quarter, as detailed in our non-GAAP disclosures. Excluding these items, non-interest income was up $5 million2 between periods due primarily to higher swap and mortgage banking income and last quarter's $2 million loss on loan sales, which did not repeat in the third quarter. Treasury management fees, a component of service charges on deposits, increased by 2% from the prior quarter and by 12% for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023.
Non-interest ExpenseNon-interest expense was $271 million for the third quarter of 2024, down $8 million from the prior quarter. Excluding merger and restructuring expense, exit and disposal costs, and accruals for the FDIC special assessment, non-interest expense was $268 million[2], up $6 million from the prior quarter, which included an $8 million reversal of prior compensation-related accruals that did not repeat in the third quarter. Salary and wages expense was down $6 million from the prior quarter, due largely to staff reductions that took place throughout the second quarter of 2024, with some of the benefit offset by higher group insurance costs. Please refer to the Q3 2024 Earnings Presentation for additional expense details.
Balance SheetTotal consolidated assets were $51.9 billion as of September 30, 2024, down slightly from $52.0 billion as of June 30, 2024. Cash and cash equivalents were $2.1 billion as of September 30, 2024, essentially unchanged from June 30, 2024. Including secured off-balance sheet lines of credit, total available liquidity was $19.4 billion as of September 30, 2024, representing 37% of total assets, 47% of total deposits, and 138% of uninsured deposits. Available-for-sale securities, which are held on balance sheet at fair value, were $8.7 billion as of September 30, 2024, an increase of $174 million relative to June 30, 2024, as the increase in the fair value of the portfolio more than offset paydowns. Please refer to the Q3 2024 Earnings Presentation for additional details related to our securities portfolio and liquidity position.
Gross loans and leases were $37.5 billion as of September 30, 2024, a decrease of $207 million relative to June 30, 2024. "Healthy business activity, like loan payoffs related to business and property sales and project completions, contributed to the quarter's loan contraction," commented Mr. Nixon. "Balances also declined as a result of our strategic decision to allow transactional loans to trend lower as we organically remix the portfolio into relationship-driven commercial loans." Please refer to the Q3 2024 Earnings Presentation for additional details related to our loan portfolio, which include underwriting characteristics, the composition of our commercial portfolios, and disclosure related to our office portfolio.
Customer deposit growth of $602 million enabled a 20% reduction in brokered CDs during the third quarter of 2024. Total deposits were $41.5 billion as of September 30, 2024, essentially unchanged from June 30, 2024, as a result of the intentional reduction in wholesale funding balances. Please refer to the Q3 2024 Earnings Presentation for additional details related to deposit characteristics and flows.
Credit QualityThe allowance for credit losses was $438 million, or 1.17% of loans and leases, compared to $439 million, or 1.16% of loans and leases, as of June 30, 2024. The provision for credit losses was $29 million for the third quarter of 2024, and it reflects credit migration trends, charge-off activity, and changes in the economic forecasts used in credit models.
Net charge-offs were 0.31% of average loans and leases (annualized) for the third quarter of 2024, compared to 0.32% for the second quarter of 2024. Net charge-offs in the FinPac portfolio were $20 million in the third quarter, down $5 million from the second quarter as lower delinquencies in the transportation sector of the portfolio resulted in lower charge-off activity. Net charge-offs excluding the FinPac portfolio were $9 million in the third quarter. Non-performing assets were $168 million, or 0.32% of total assets, as of September 30, 2024, compared to $156 million, or 0.30% of total assets, as of June 30, 2024. Please refer to the Q3 2024 Earnings Presentation for additional details related to the allowance for credit losses and other credit trends.
_____________________________
2 "Non-GAAP" financial measure. See GAAP to Non-GAAP Reconciliation for additional information.
CapitalColumbia's book value per common share was $25.17 as of September 30, 2024, compared to $23.76 as of June 30, 2024. The change reflects organic net capital generation and a favorable change in accumulated other comprehensive (loss) income ("AOCI") to $(234) million at September 30, 2024, compared to $(456) million at the prior quarter-end. The change in AOCI is due primarily to a decrease in the tax-effected net unrealized loss on available-for-sale securities to $219 million as of September 30, 2024, compared to $442 million as of June 30, 2024. Tangible book value per common share3 was $17.81 as of September 30, 2024, compared to $16.26 as of June 30, 2024.
Columbia's estimated total risk-based capital ratio was 12.5% and its estimated common equity tier 1 risk-based capital ratio was 10.3% as of September 30, 2024, compared to 12.2% and 10.0%, respectively, as of June 30, 2024. Columbia remains above current "well-capitalized" regulatory minimums. The regulatory capital ratios as of September 30, 2024 are estimates, pending completion and filing of Columbia's regulatory reports.
Earnings Presentation and Conference Call InformationColumbia's Q3 2024 Earnings Presentation provides additional disclosure. A copy will be available on our investor relations page: www.columbiabankingsystem.com.
Columbia will host its third quarter 2024 earnings conference call on October 24, 2024, at 8:30 a.m. PT (11:30 a.m. ET). During the call, Columbia's management will provide an update on recent activities and discuss its third quarter 2024 financial results. Participants may register for the call using the link below to receive dial-in details and their own unique PINs or join the audiocast. It is recommended you join 10 minutes prior to the start time.
Register for the call: https://register.vevent.com/register/BIabbcdb79db7641c096e78119393cf06fJoin the audiocast: https://edge.media-server.com/mmc/p/rzbdb27z/Access the replay through Columbia's investor relations page: www.columbiabankingsystem.com
About Columbia Banking System, Inc.Columbia (NASDAQ:COLB) is headquartered in Tacoma, Washington and is the parent company of Umpqua Bank, an award-winning western U.S. regional bank based in Lake Oswego, Oregon. Umpqua Bank is the largest bank headquartered in the Northwest and one of the largest banks headquartered in the West with locations in Arizona, California, Colorado, Idaho, Nevada, Oregon, Utah, and Washington. With over $50 billion of assets, Umpqua Bank combines the resources, sophistication, and expertise of a national bank with a commitment to deliver superior, personalized service. The bank supports consumers and businesses through a full suite of services, including retail and commercial banking; Small Business Administration lending; institutional and corporate banking; and equipment leasing. Umpqua Bank customers also have access to comprehensive investment and wealth management expertise as well as healthcare and private banking through Columbia Wealth Advisors and Columbia Trust Company, a division of Umpqua Bank. Learn more at www.columbiabankingsystem.com.
_____________________________
3 "Non-GAAP" financial measure. See GAAP to Non-GAAP Reconciliation for additional information.
Forward-Looking StatementsThis press release includes forward-looking statements within the meaning of the "Safe-Harbor" provisions of the Private Securities Litigation Reform Act of 1995, which management believes are a benefit to shareholders. These statements are necessarily subject to risk and uncertainty and actual results could differ materially due to various risk factors, including those set forth from time to time in our filings with the Securities and Exchange Commission. You should not place undue reliance on forward-looking statements and we undertake no obligation to update any such statements. Forward-looking statements can be identified by words such as "anticipates," "intends," "plans," "seeks," "believes," "estimates," "expects," "target," "projects," "outlook," "forecast," "will," "may," "could," "should," "can" and similar references to future periods. In this press release we make forward-looking statements about strategic and growth initiatives and the result of such activity. Risks and uncertainties that could cause results to differ from forward-looking statements we make include, without limitation: current and future economic and market conditions, including the effects of declines in housing and commercial real estate prices, high unemployment rates, continued inflation and any recession or slowdown in economic growth particularly in the western United States; economic forecast variables that are either materially worse or better than end of quarter projections and deterioration in the economy that could result in increased loan and lease losses, especially those risks associated with concentrations in real estate related loans; our ability to effectively manage problem credits; the impact of bank failures or adverse developments at other banks on general investor sentiment regarding the liquidity and stability of banks; changes in interest rates that could significantly reduce net interest income and negatively affect asset yields and valuations and funding sources; changes in the scope and cost of FDIC insurance and other coverage; our ability to successfully implement efficiency and operational excellence initiatives; our ability to successfully develop and market new products and technology; changes in laws or regulations; any failure to realize the anticipated benefits of the merger when expected; potential adverse reactions or changes to business or employee relationships, including those resulting from the completion of the merger and integration of the companies; the effect of geopolitical instability, including wars, conflicts and terrorist attacks; and natural disasters and other similar unexpected events outside of our control. We also caution that the amount and timing of any future common stock dividends or repurchases will depend on the earnings, cash requirements and financial condition of Columbia, market conditions, capital requirements, applicable law and regulations (including federal securities laws and federal banking regulations), and other factors deemed relevant by Columbia's Board of Directors, and may be subject to regulatory approval or conditions.
TABLE INDEX
Page
Consolidated Statements of Income
7
Consolidated Balance Sheets
8
Financial Highlights
10
Loan & Lease Portfolio Balances and Mix
11
Deposit Portfolio Balances and Mix
13
Credit Quality - Non-performing Assets
14
Credit Quality - Allowance for Credit Losses
15
Consolidated Average Balance Sheets, Net Interest Income, and Yields/Rates
17
Residential Mortgage Banking Activity
19
GAAP to Non-GAAP Reconciliation
21
Columbia Banking System, Inc.
Consolidated Statements of Income
(Unaudited)
Quarter Ended
% Change
($ in thousands, except per share data)
Sep 30, 2024
Jun 30, 2024
Mar 31, 2024
Dec 31, 2023
Sep 30, 2023
Seq.
Quarter
Year over Year
Interest income:
Loans and leases
$ 588,603
$ 583,874
$ 575,044
$ 577,741
$ 569,670
1 %
3 %
Interest and dividends on investments:
Taxable
76,074
78,828
75,017
78,010
80,066
(3) %
(5) %
Exempt from federal income tax
6,855
6,904
6,904
6,966
6,929
(1) %
(1) %
Dividends
2,681
2,895
3,707
4,862
4,941
(7) %
(46) %
Temporary investments and interest bearing deposits
24,683
23,035
23,553
24,055
34,407
7 %
(28) %
Total interest income
698,896
695,536
684,225
691,634
696,013
— %
— %
Interest expense:
Deposits
208,027
207,307
198,435
170,659
126,974
— %
64 %
Securities sold under agreement to repurchase andfederal funds purchased
1,121
1,515
1,266
1,226
1,220
(26) %
(8) %
Borrowings
49,636
49,418
51,275
56,066
77,080
— %
(36) %
Junior and other subordinated debentures
9,894
9,847
9,887
10,060
9,864
— %
— %
Total interest expense
268,678
268,087
260,863
238,011
215,138
— %
25 %
Net interest income
430,218
427,449
423,362
453,623
480,875
1 %
(11) %
Provision for credit losses
28,769
31,820
17,136
54,909
36,737
(10) %
(22) %
Non-interest income:
Service charges on deposits
18,549
18,503
16,064
17,349
17,410
— %
7 %
Card-based fees
14,591
14,681
13,183
14,593
15,674
(1) %
(7) %
Financial services and trust revenue
5,083
5,396
4,464
3,011
4,651
(6) %
9 %
Residential mortgage banking revenue, net
6,668
5,848
4,634
4,212
7,103
14 %
(6) %
Gain (loss) on sale of debt securities, net
3
(1)
12
9
4
nm
(25) %
Gain (loss) on equity securities, net
2,272
325
(1,565)
2,636
(2,055)
nm
nm
Gain (loss) on loan and lease sales, net
161
(1,516)
221
1,161
1,871
nm
(91) %
BOLI income
4,674
4,705
4,639
4,331
4,440
(1) %
5 %
Other income (loss)
14,158
(3,238)
8,705
18,231
(5,117)
nm
nm
Total non-interest income
66,159
44,703
50,357
65,533
43,981
48 %
50 %
Non-interest expense:
Salaries and employee benefits
147,268
145,066
154,538
157,572
159,041
2 %
(7) %
Occupancy and equipment, net
45,056
45,147
45,291
48,160
43,070
— %
5 %
Intangible amortization
29,055
29,230
32,091
33,204
29,879
(1) %
(3) %
FDIC assessments
9,332
9,664
14,460
42,510
11,200
(3) %
(17) %
Merger and restructuring expense
2,364
14,641
4,478
7,174
18,938
(84) %
(88) %
Other expenses
38,283
35,496
36,658
48,556
42,019
8 %
(9) %
Total non-interest expense
271,358
279,244
287,516
337,176
304,147
(3) %
(11) %
Income before provision for income taxes
196,250
161,088
169,067
127,071
183,972
22 %
7 %
Provision for income taxes
50,068
40,944
44,987
33,540
48,127
22 %
4 %
Net income
$ 146,182
$ 120,144
$ 124,080
$ 93,531
$ 135,845
22 %
8 %
Weighted average basic shares outstanding
208,545
208,498
208,260
208,083
208,070
— %
— %
Weighted average diluted shares outstanding
209,454
209,011
208,956
208,739
208,645
— %
— %
Earnings per common share, basic
$ 0.70
$ 0.58
$ 0.60
$ 0.45
$ 0.65
21 %
8 %
Earnings per common share, diluted
$ 0.70
$ 0.57
$ 0.59
$ 0.45
$ 0.65
23 %
8 %
nm = Percentage changes greater than +/-500% are considered not meaningful and are presented as "nm."
Columbia Banking System, Inc.
Consolidated Statements of Income
(Unaudited)
Nine Months Ended
% Change
($ in thousands, except per share data)
Sep 30, 2024
Sep 30, 2023
Year over Year
Interest income:
Loans and leases
$ 1,747,521
$ 1,535,874
14 %
Interest and dividends on investments:
Taxable
229,919
198,831
16 %
Exempt from federal income tax
20,663
17,143
21 %
Dividends
9,283
8,241
13 %
Temporary investments and interest bearing deposits
71,271
87,604
(19) %
Total interest income
2,078,657
1,847,693
13 %
Interest expense:
Deposits
613,769
290,995
111 %
Securities sold under agreement to repurchase and federal funds purchased
3,902
2,697
45 %
Borrowings
150,329
186,848
(20) %
Junior and other subordinated debentures
29,628
27,605
7 %
Total interest expense
797,628
508,145
57 %
Net interest income
1,281,029
1,339,548
(4) %
Provision for credit losses
77,725
158,290
(51) %
Non-interest income:
Service charges on deposits
53,116
48,176
10 %
Card-based fees
42,455
40,670
4 %
Financial services and trust revenue
14,943
10,460
43 %
Residential mortgage banking revenue, net
17,150
12,577
36 %
Gain on sale of debt securities, net
14
4
250 %
Gain (loss) on equity securities, net
1,032
(336)
nm
(Loss) gain on loan and lease sales, net
(1,134)
3,253
(135) %
BOLI income
14,018
11,293
24 %
Other income
19,625
12,297
60 %
Total non-interest income
161,219
138,394
16 %
Non-interest expense:
Salaries and employee benefits
446,872
458,531
(3) %
Occupancy and equipment, net
135,494
135,320
0 %
Intangible amortization
90,376
78,092
16 %
FDIC assessments
33,456
28,892
16 %
Merger and restructuring expense
21,483
164,485
(87) %
Other expenses
110,437
110,204
0 %
Total non-interest expense
838,118
975,524
(14) %
Income before provision for income taxes
526,405
344,128
53 %
Provision for income taxes
135,999
88,944
53 %
Net income
$ 390,406
$ 255,184
53 %
Weighted average basic shares outstanding
208,435
190,997
9 %
Weighted average diluted shares outstanding
209,137
191,546
9 %
Earnings per common share, basic
$ 1.87
$ 1.34
40 %
Earnings per common share, diluted
$ 1.87
$ 1.33
41 %
nm = Percentage changes greater than +/-500% are considered not meaningful and are presented as "nm."
Columbia Banking System, Inc.
Consolidated Balance Sheets
(Unaudited)
% Change
($ in thousands, except per share data)
Sep 30, 2024
Jun 30, 2024
Mar 31, 2024
Dec 31, 2023
Sep 30, 2023
Seq.
Quarter
Year over Year
Assets:
Cash and due from banks
$ 591,364
$ 515,263
$ 440,215
$ 498,496
$ 492,474
15 %
20 %
Interest-bearing cash and temporaryinvestments
1,519,658
1,553,568
1,760,902
1,664,038
1,911,221
(2) %
(20) %
Investment securities:
Equity and other, at fair value
79,996
77,221
77,203
76,995
73,638
4 %
9 %
Available for sale, at fair value
8,676,807
8,503,000
8,616,545
8,829,870
8,503,986
2 %
2 %
Held to maturity, at amortized cost
2,159
2,203
2,247
2,300
2,344
(2) %
(8) %
Loans held for sale
66,639
56,310
47,201
30,715
60,313
18 %
10 %
Loans and leases
37,503,002
37,709,987
37,642,413
37,441,951
37,170,598
(1) %
1 %
Allowance for credit losses on loans and leases
(420,054)
(418,671)
(414,344)
(440,871)
(416,560)
— %
1 %
Net loans and leases
37,082,948
37,291,316
37,228,069
37,001,080
36,754,038
(1) %
1 %
Restricted equity securities
116,274
116,274
116,274
179,274
168,524
— %
(31) %
Premises and equipment, net
338,107
337,842
336,869
338,970
337,855
— %
— %
Operating lease right-of-use assets
106,224
108,278
113,833
115,811
114,220
(2) %
(7) %
Goodwill
1,029,234
1,029,234
1,029,234
1,029,234
1,029,234
— %
— %
Other intangible assets, net
513,303
542,358
571,588
603,679
636,883
(5) %
(19) %
Residential mortgage servicing rights, at fairvalue
101,919
110,039
110,444
109,243
117,640
(7) %
(13) %
Bank-owned life insurance
691,160
686,485
682,293
680,948
648,232
1 %
7 %
Deferred tax asset, net
286,432
361,773
356,031
347,203
469,841
(21) %
(39) %
Other assets
706,375
756,319
735,058
665,740
673,372
(7) %
5 %
Total assets
$ 51,908,599
$ 52,047,483
$ 52,224,006
$ 52,173,596
$ 51,993,815
— %
— %
Liabilities:
Deposits
Non-interest-bearing
$ 13,534,065
$ 13,481,616
$ 13,808,554
$ 14,256,452
$ 15,532,948
— %
(13) %
Interest-bearing
27,980,623
28,041,656
27,897,606
27,350,568
26,091,420
— %
7 %
Total deposits
41,514,688
41,523,272
41,706,160
41,607,020
41,624,368
— %
— %
Securities sold under agreements to repurchase
183,833
197,860
213,573
252,119
258,383
(7) %
(29) %
Borrowings
3,650,000
3,900,000
3,900,000
3,950,000
3,985,000
(6) %
(8) %
Junior subordinated debentures, at fair value
311,896
310,187
309,544
316,440
331,545
1 %
(6) %
Junior and other subordinated debentures, at amortized cost
107,725
107,781
107,838
107,895
107,952
— %
— %
Operating lease liabilities
121,298
123,082
129,240
130,576
129,845
(1) %
(7) %
Other liabilities
745,331
908,629
900,406
814,512
924,560
(18) %
(19) %
Total liabilities
46,634,771
47,070,811
47,266,761
47,178,562
47,361,653
(1) %
(2) %
Shareholders' equity:
Common stock
5,812,237
5,807,041
5,802,322
5,802,747
5,798,167
— %
— %
Accumulated deficit
(304,525)
(374,687)
(418,946)
(467,571)
(485,576)
(19) %
(37) %
Accumulated other comprehensive loss
(233,884)
(455,682)
(426,131)
(340,142)
(680,429)
(49) %
(66) %
Total shareholders' equity
5,273,828
4,976,672
4,957,245
4,995,034
4,632,162
6 %
14 %
Total liabilities and shareholders' equity
$ 51,908,599
$ 52,047,483
$ 52,224,006
$ 52,173,596
$ 51,993,815
— %
— %
Common shares outstanding at period end
209,532
209,459
209,370
208,585
208,575
— %
— %
Columbia Banking System, Inc.
Financial Highlights
(Unaudited)
Quarter Ended
% Change
Sep 30, 2024
Jun 30,2024
Mar 31, 2024
Dec 31, 2023
Sep 30, 2023
Seq. Quarter
Year over Year
Per Common Share Data:
Dividends
$ 0.36
$ 0.36
$ 0.36
$ 0.36
$ 0.36
— %
— %
Book value
$ 25.17
$ 23.76
$ 23.68
$ 23.95
$ 22.21
6 %
13 %
Tangible book value (1)
$ 17.81
$ 16.26
$ 16.03
$ 16.12
$ 14.22
10 %
25 %
Performance Ratios:
Efficiency ratio (2)
54.56 %
59.02 %
60.57 %
64.81 %
57.82 %
(4.46)
(3.26)
Non-interest expense to average assets (1)
2.08 %
2.16 %
2.22 %
2.58 %
2.28 %
(0.08)
(0.20)
Return on average assets ("ROAA")
1.12 %
0.93 %
0.96 %
0.72 %
1.02 %
0.19
0.10
Pre-provision net revenue ("PPNR") ROAA (1)
1.72 %
1.49 %
1.44 %
1.39 %
1.65 %
0.23
0.07
Return on average common equity
11.36 %
9.85 %
10.01 %
7.90 %
11.07 %
1.51
0.29
Return on average tangible common equity (1)
16.34 %
14.55 %
14.82 %
12.19 %
16.93 %
1.79
(0.59)
Performance Ratios - Operating: (1)
Operating efficiency ratio, as adjusted (1), (2), (5), (6)
53.89 %
53.56 %
56.97 %
57.31 %
51.26 %
0.33
2.63
Operating non-interest expense to average assets (1)
2.05 %
2.03 %
2.14 %
2.25 %
2.10 %
0.02
(0.05)
Operating ROAA (1), (6)
1.10 %
1.08 %
1.04 %
0.89 %
1.23 %
0.02
(0.13)
Operating PPNR ROAA (1), (6)
1.69 %
1.70 %
1.55 %
1.62 %
1.94 %
(0.01)
(0.25)
Operating return on average common equity (1), (6)
11.15 %
11.47 %
10.89 %
9.81 %
13.40 %
(0.32)
(2.25)
Operating return on average tangible common equity (1), (6)
16.04 %
16.96 %
16.12 %
15.14 %
20.48 %
(0.92)
(4.44)
Average Balance Sheet Yields, Rates, & Ratios:
Yield on loans and leases
6.22 %
6.20 %
6.13 %
6.13 %
6.08 %
0.02
0.14
Yield on earning assets (2)
5.78 %
5.80 %
5.69 %
5.75 %
5.65 %
(0.02)
0.13
Cost of interest bearing deposits
2.95 %
2.97 %
2.88 %
2.54 %
2.01 %
(0.02)
0.94
Cost of interest bearing liabilities
3.29 %
3.31 %
3.25 %
3.02 %
2.72 %
(0.02)
0.57
Cost of total deposits
1.99 %
2.01 %
1.92 %
1.63 %
1.23 %
(0.02)
0.76
Cost of total funding (3)
2.32 %
2.34 %
2.27 %
2.05 %
1.81 %
(0.02)
0.51
Net interest margin (2)
3.56 %
3.56 %
3.52 %
3.78 %
3.91 %
—
(0.35)
Average interest bearing cash / Average interest earning assets
3.74 %
3.51 %
3.56 %
3.64 %
5.17 %
0.23
(1.43)
Average loans and leases / Average interest earning assets
77.91 %
78.27 %
77.87 %
78.04 %
75.64 %
(0.36)
2.27
Average loans and leases / Average total deposits
90.42 %
90.61 %
90.41 %
89.91 %
90.63 %
(0.19)
(0.21)
Average non-interest bearing deposits / Average total deposits
32.52 %
32.54 %
33.29 %
35.88 %
38.55 %
(0.02)
(6.03)
Average total deposits / Average total funding (3)
90.25 %
90.15 %
90.09 %
90.02 %
86.66 %
0.10
3.59
Select Credit & Capital Ratios:
Non-performing loans and leases to total loans and leases
0.44 %
0.41 %
0.38 %
0.30 %
0.28 %
0.03
0.16
Non-performing assets to total assets
0.32 %
0.30 %
0.28 %
0.22 %
0.20 %
0.02
0.12
Allowance for credit losses to loans and leases
1.17 %
1.16 %
1.16 %
1.24 %
1.18 %
0.01
(0.01)
Total risk-based capital ratio (4)
12.5 %
12.2 %
12.0 %
11.9 %
11.6 %
0.30
0.90
Common equity tier 1 risk-based capital ratio (4)
10.3 %
10.0 %
9.8 %
9.6 %
9.5 %
0.30
0.80
(1)
See GAAP to Non-GAAP Reconciliation.
(2)
Tax-exempt interest was adjusted to a taxable equivalent basis using a 21% tax rate.
(3)
Total funding = Total deposits + Total borrowings.
(4)
Estimated holding company ratios.
(5)
The operating efficiency ratio was adjusted in the first quarter of 2024 to remove B&O taxes and for a tax-equivalent adjustment to BOLI income. The Company views the adjusted operating efficiency ratio as a better representation of its efficiency ratio when compared to other banks as it normalizes for the tax treatment of the adjusted items. The adjustment re-aligns Columbia's calculation of its operating efficiency ratio with its pre-merger calculation.
(6)
Non-interest expense adjustments were revised subsequent to the Company's reporting of its earnings results for the period ended December 31, 2023. The revision includes adding the FDIC special assessment to the non-interest expense adjustments, which removes the special assessment from the Company's calculation of operating non-interest expense. The Company views the special assessment as an infrequent expense that is outside the control of the Company.
Columbia Banking System, Inc.
Financial Highlights
(Unaudited)
Nine Months Ended
% Change
Sep 30, 2024
Sep 30, 2023
Year over Year
Per Common Share Data:
Dividends
$ 1.08
$ 1.07
0.93 %
Performance Ratios:
Efficiency ratio (2)
57.99 %
65.87 %
(7.88)
Non-interest expense to average assets (1)
2.15 %
2.68 %
(0.53)
Return on average assets
1.00 %
0.70 %
0.30
PPNR ROAA (1)
1.55 %
1.38 %
0.17
Return on average common equity
10.42 %
7.77 %
2.65
Return on average tangible common equity (1)
15.27 %
11.21 %
4.06
Performance Ratios - Operating: (1)
Operating efficiency ratio, as adjusted (1), (2), (4), (5)
54.80 %
52.70 %
2.10
Operating non-interest expense to average assets (1)
2.07 %
2.21 %
(0.14)
Operating ROAA (1), (5)
1.07 %
1.11 %
(0.04)
Operating PPNR ROAA (1), (5)
1.65 %
1.91 %
(0.26)
Operating return on average common equity (1), (5)
11.17 %
12.34 %
(1.17)
Operating return on average tangible common equity (1), (5)
16.36 %
17.80 %
(1.44)
Average Balance Sheet Yields, Rates, & Ratios:
Yield on loans and leases
6.18 %
5.88 %
0.30
Yield on earning assets (2)
5.76 %
5.46 %
0.30
Cost of interest bearing deposits
2.93 %
1.68 %
1.25
Cost of interest bearing liabilities
3.28 %
2.38 %
0.90
Cost of total deposits
1.97 %
1.02 %
0.95
Cost of total funding (3)
2.31 %
1.56 %
0.75
Net interest margin (2)
3.55 %
3.96 %
(0.41)
Average interest bearing cash / Average interest earning assets
3.61 %
5.05 %
(1.44)
Average loans and leases / Average interest earning assets
78.02 %
76.91 %
1.11
Average loans and leases / Average total deposits
90.48 %
91.42 %
(0.94)
Average non-interest bearing deposits / Average total deposits
32.78 %
39.28 %
(6.50)
Average total deposits / Average total funding (3)
90.16 %
87.53 %
2.63
(1)
See GAAP to Non-GAAP Reconciliation.
(2)
Tax-exempt interest was adjusted to a taxable equivalent basis using a 21% tax rate.
(3)
Total funding = Total deposits + Total borrowings.
(4)
The operating efficiency ratio was adjusted in the first quarter of 2024 to remove B&O taxes and for a tax-equivalent adjustment to BOLI income. The Company views the adjusted operating efficiency ratio as a better representation of its efficiency ratio when compared to other banks as it normalizes for the tax treatment of the adjusted items. The adjustment re-aligns Columbia's calculation of its operating efficiency ratio with its pre-merger calculation.
(5)
Non-interest expense adjustments were revised subsequent to the Company's reporting of its earnings results for the period ended December 31, 2023. The revision includes adding the FDIC special assessment to the non-interest expense adjustments, which removes the special assessment from the Company's calculation of operating non-interest expense. The Company views the special assessment as an infrequent expense that is outside the control of the Company.
Columbia Banking System, Inc.
Loan & Lease Portfolio Balances and Mix
(Unaudited)
Sep 30, 2024
Jun 30, 2024
Mar 31, 2024
Dec 31, 2023
Sep 30, 2023
% Change
($ in thousands)
Amount
Amount
Amount
Amount
Amount
Seq. Quarter
Yearover Year
Loans and leases:
Commercial real estate:
Non-owner occupied term, net
$ 6,391,806
$ 6,407,351
$ 6,557,768
$ 6,482,940
$ 6,490,638
— %
(2) %
Owner occupied term, net
5,210,485
5,230,511
5,231,676
5,195,605
5,235,227
— %
— %
Multifamily, net
5,779,737
5,868,848
5,828,960
5,704,734
5,684,495
(2) %
2 %
Construction & development, net
1,988,923
1,946,693
1,728,652
1,747,302
1,669,918
2 %
19 %
Residential development, net
244,579
269,106
284,117
323,899
354,922
(9) %
(31) %
Commercial:
Term, net
5,429,209
5,559,548
5,544,450
5,536,765
5,437,915
(2) %
— %
Lines of credit & other, net
