Synovus announces earnings for the third quarter 2023

Diluted earnings per share of $0.60 vs. $1.33 in 3Q22

Adjusted diluted earnings per share of $0.84 vs. $1.34 in 3Q22

COLUMBUS, Ga.--()--Synovus Financial Corp. (NYSE: SNV) today reported financial results for the quarter ended Sept. 30, 2023. “Our third quarter financial results reflect agility and disciplined execution amid complex market dynamics,” said Synovus Chairman, CEO and President Kevin Blair. “While we navigate through this uncertain economic landscape, our primary focus remains on strengthening and growing our core client relationships and strategically positioning Synovus for future growth. This includes efforts to optimize the balance sheet as well as business mix. Our proactive measures taken in the third quarter have further derisked the company by reducing our wholesale funding ratio to 15% and elevating the CET1 ratio beyond 10%, while also streamlining ongoing expenses. We are confidently looking forward to a strong close for 2023, and we are optimistic about the return to a stronger growth orientation as we progress through 2024.”

Third Quarter 2023 Highlights

  • Completed the previously announced sales of $338 million of third-party consumer loans and $1.2 billion of medical office building loans as well as the sale of asset management firm GLOBALT to its management team.
  • Total revenue of $550.3 million declined $31.9 million, or 5%, compared to the third quarter 2022, driven by net interest income decrease of 7%, partially offset by growth in client fee income, excluding mortgage, of 5% year over year.
  • Pre-provision net revenue of $196.8 million declined $91.4 million, or 32%, compared to the third quarter 2022, mostly driven by increases in funding costs, losses on the aforementioned loan sales and restructuring charges related to a voluntary early retirement program.
  • Period-end loans declined $673.6 million sequentially, primarily driven by the $1.2 billion medical office building loans sale.
  • Total deposits increased $123.5 million sequentially, while core deposits (excluding brokered deposits) grew $431.5 million, as remixing began to slow.
  • As expected, credit quality metrics continued to increase from historically low levels and included a net charge-off ratio of 0.61% (driven by the previously disclosed medical office loan sale and a shared national C&I credit), a 3 bps increase in the ACL ratio to 1.22%, and non-performing loan and asset ratios both at 0.64%.
  • The preliminary CET1 ratio of 10.13% increased 27 bps sequentially as capital preservation remains the near-term priority given persistent economic uncertainty.

Third Quarter Summary

 

 

 

Reported

 

Adjusted

(dollars in thousands)

 

3Q23

 

 

 

2Q23

 

 

 

3Q22

 

 

 

3Q23

 

 

 

2Q23

 

 

 

3Q22

 

Net income available to common shareholders

$

87,423

 

 

$

165,819

 

 

$

194,753

 

 

$

122,770

 

 

$

169,526

 

 

$

195,481

 

Diluted earnings per share

 

0.60

 

 

 

1.13

 

 

 

1.33

 

 

 

0.84

 

 

 

1.16

 

 

 

1.34

 

Total revenue

 

550,298

 

 

 

567,807

 

 

 

582,217

 

 

 

550,552

 

 

 

567,347

 

 

 

584,265

 

Total loans

 

43,679,910

 

 

 

44,353,537

 

 

 

42,571,458

 

 

 

N/A

 

 

 

N/A

 

 

 

N/A

 

Total deposits

 

50,203,890

 

 

 

50,080,392

 

 

 

47,697,564

 

 

 

N/A

 

 

 

N/A

 

 

 

N/A

 

Return on avg assets

 

0.64

%

 

 

1.15

%

 

 

1.39

%

 

 

0.87

%

 

 

1.18

%

 

 

1.39

%

Return on avg common equity

 

8.2

 

 

 

15.5

 

 

 

18.7

 

 

 

11.5

 

 

 

15.8

 

 

 

18.7

 

Return on avg tangible common equity

 

9.7

 

 

 

17.7

 

 

 

21.3

 

 

 

13.5

 

 

 

18.1

 

 

 

21.4

 

Net interest margin

 

3.11

 

 

 

3.20

 

 

 

3.47

 

 

 

N/A

 

 

 

N/A

 

 

 

N/A

 

Efficiency ratio-TE(1)(2)

 

64.11

 

 

 

53.99

 

 

 

50.41

 

 

 

55.01

 

 

 

52.57

 

 

 

49.98

 

NCO ratio-QTD

 

0.61

 

 

 

0.24

 

 

 

0.04

 

 

 

N/A

 

 

 

N/A

 

 

 

N/A

 

NPA ratio

 

0.64

 

 

 

0.59

 

 

 

0.32

 

 

 

N/A

 

 

 

N/A

 

 

 

N/A

 

(1) Taxable equivalent

(2) Adjusted tangible efficiency ratio

Balance Sheet

 

Loans*

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(dollars in millions)

3Q23

 

2Q23

 

Linked
Quarter
Change

 

Linked
Quarter %
Change

 

3Q22

 

Year/Year
Change

 

Year/Year %
Change

Commercial & industrial

$

22,781.0

 

$

22,531.2

 

$

249.7

 

 

1

%

 

$

21,212.5

 

$

1,568.4

 

 

7

%

Commercial real estate

 

12,394.9

 

 

13,293.9

 

 

(899.0

)

 

(7

)

 

 

12,288.0

 

 

106.9

 

 

1

 

Consumer

 

8,504.1

 

 

8,528.4

 

 

(24.3

)

 

 

 

 

9,071.0

 

 

(566.9

)

 

(6

)

Total loans

$

43,679.9

 

$

44,353.5

 

$

(673.6

)

 

(2

)%

 

$

42,571.5

 

$

1,108.4

 

 

3

%

*Amounts may not total due to rounding

  • Total loans ended the quarter at $43.68 billion, down $673.6 million sequentially, primarily driven by the $1.2 billion medical office building loans sale.
  • Commercial and industrial (C&I) loans rose $249.7 million sequentially as activity in middle market commercial, Corporate and Investment Banking, and specialty lines contributed to the growth.
  • CRE loans declined $899.0 million sequentially, driven by the aforementioned medical office building loans sale partially offset by draws on existing multi-family commitments and continued low levels of pay-offs.
  • Consumer loans declined $24.3 million sequentially, largely a result of continued third-party contraction from sales as well as runoff somewhat offset by growth in portfolio mortgages.
 

Deposits*

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(dollars in millions)

3Q23

 

2Q23

 

Linked
Quarter
Change

 

Linked
Quarter %
Change

 

3Q22

 

Year/Year
Change

 

Year/Year
% Change

Non-interest-bearing DDA

$

12,395.1

 

$

12,945.5

 

$

(550.4

)

 

(4

)%

 

$

15,373.7

 

$

(2,978.6

)

 

(19

)%

Interest-bearing DDA

 

6,276.1

 

 

6,255.3

 

 

20.8

 

 

 

 

 

5,777.7

 

 

498.4

 

 

9

 

Money market

 

10,786.3

 

 

10,803.7

 

 

(17.4

)

 

 

 

 

12,917.6

 

 

(2,131.3

)

 

(16

)

Savings

 

1,132.5

 

 

1,222.9

 

 

(90.4

)

 

(7

)

 

 

1,470.1

 

 

(337.6

)

 

(23

)

Public funds

 

6,885.7

 

 

7,031.4

 

 

(145.7

)

 

(2

)

 

 

5,549.7

 

 

1,336.0

 

 

24

 

Time deposits

 

6,506.4

 

 

5,291.8

 

 

1,214.6

 

 

23

 

 

 

2,110.9

 

 

4,395.5

 

 

208

 

Brokered deposits

 

6,221.8

 

 

6,529.8

 

 

(308.0

)

 

(5

)

 

 

4,497.8

 

 

1,724.0

 

 

38

 

Total deposits

$

50,203.9

 

$

50,080.4

 

$

123.5

 

 

%

 

$

47,697.6

 

$

2,506.3

 

 

5

%

*Amounts may not total due to rounding

  • Total deposits ended the quarter at $50.20 billion, up $123.5 million sequentially, while core deposits (excluding brokered deposits) grew $431.5 million.
    • Time deposits growth was partially offset by a decline in non-interest-bearing DDA deposits, a byproduct of cash deployment of excess funds and continued pressures from the higher rate environment, the rate of which has slowed.
  • Total deposit costs increased 36 bps sequentially to 2.31% and continued to be impacted by pricing lags on core interest-bearing deposits (excluding brokered deposits) as well as the decline in non-interest-bearing DDAs.
 

Income Statement Summary**

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(in thousands, except per share data)

3Q23

 

2Q23

 

Linked
Quarter
Change

 

Linked
Quarter %
Change

 

3Q22

 

Year/Year
Change

 

Year/Year
% Change

Net interest income

$

443,159

 

 

$

455,531

 

 

$

(12,372

)

 

(3

)%

 

$

477,919

 

 

$

(34,760

)

 

(7

)%

Non-interest revenue

 

107,139

 

 

 

112,276

 

 

 

(5,137

)

 

(5

)

 

 

104,298

 

 

 

2,841

 

 

3

 

Non-interest expense

 

353,532

 

 

 

307,181

 

 

 

46,351

 

 

15

 

 

 

294,010

 

 

 

59,522

 

 

20

 

Provision for (reversal of) credit losses

 

72,572

 

 

 

38,881

 

 

 

33,691

 

 

87

 

 

 

25,581

 

 

 

46,991

 

 

184

 

Income before taxes

$

124,194

 

 

$

221,745

 

 

$

(97,551

)

 

(44

)%

 

$

262,626

 

 

$

(138,432

)

 

(53

)%

Income tax expense

 

27,729

 

 

 

47,801

 

 

 

(20,072

)

 

(42

)

 

 

59,582

 

 

 

(31,853

)

 

(53

)

Net income

 

96,465

 

 

 

173,944

 

 

 

(77,479

)

 

(45

)

 

 

203,044

 

 

 

(106,579

)

 

(52

)

Less: Net income (loss) attributable to noncontrolling interest

 

(630

)

 

 

(166

)

 

 

(464

)

 

NM

 

 

 

 

 

 

(630

)

 

NM

 

Net income attributable to Synovus Financial Corp.

 

97,095

 

 

 

174,110

 

 

 

(77,015

)

 

(44

)

 

 

203,044

 

 

 

(105,949

)

 

(52

)

Less: Preferred stock dividends

 

9,672

 

 

 

8,291

 

 

 

1,381

 

 

17

 

 

 

8,291

 

 

 

1,381

 

 

17

 

Net income available to common shareholders

$

87,423

 

 

$

165,819

 

 

$

(78,396

)

 

(47

)%

 

$

194,753

 

 

$

(107,330

)

 

(55

)%

Weighted average common shares outstanding, diluted

 

146,740

 

 

 

146,550

 

 

 

190

 

 

%

 

 

146,418

 

 

 

322

 

 

%

Diluted earnings per share

$

0.60

 

 

$

1.13

 

 

$

(0.53

)

 

(47

)

 

$

1.33

 

 

$

(0.73

)

 

(55

)

Adjusted diluted earnings per share

 

0.84

 

 

 

1.16

 

 

 

(0.32

)

 

(28

)

 

 

1.34

 

 

 

(0.50

)

 

(37

)

Effective tax rate

 

22.33

%

 

 

21.56

%

 

 

 

 

 

 

22.69

%

 

 

 

 

** Amounts may not total due to rounding

Core Performance

  • Net interest income of $443.2 million was down $12.4 million sequentially, or 3%, and fell $34.8 million, or 7%, compared to the third quarter 2022.
    • The quarter-over-quarter decline was largely driven by modest increases in deposit costs and a continued decline in non-interest-bearing DDA deposits, but at a slower pace, partially offset by modestly better asset yields.
      • Net interest margin was 3.11%, down 9 bps sequentially, impacted by the same factors mentioned above.
    • The year-over-year decline resulted primarily from higher deposit costs and negative remixing from non-interest DDA deposits somewhat offset by higher asset yields.
  • Non-interest revenue fell $5.1 million, or 5%, sequentially and increased $2.8 million, or 3%, compared to the third quarter 2022. Adjusted non-interest revenue declined $4.4 million, or 4%, sequentially and increased $0.9 million, or 1%, compared to the third quarter 2022.
    • The quarter-over-quarter decrease was impacted by recent changes to the NSF/overdraft program, a soft mortgage lending market and more muted capital markets activity.
    • The year-over-year increase primarily related to higher wealth revenue and increased card fees.
  • Non-interest expense increased $46.4 million, or 15%, sequentially and increased $59.5 million, or 20%, compared to the third quarter 2022. Adjusted non-interest expense increased $5.2 million, or 2%, sequentially and increased $11.8 million, or 4%, compared to the third quarter 2022.
    • The quarter-over-quarter and year-over-year increases were largely impacted by a $31.0 million loss from loan sales and $18.4 million in voluntary early retirement charges. The year-over-year increase was also affected by new business initiatives and infrastructure investments as well as higher FDIC insurance and healthcare costs.
  • As expected, credit quality metrics continued to increase from historically low levels. The non-performing loan and asset ratios both moved to 0.64%; the net charge-off ratio for the quarter was 0.61%, largely driven by the medical office building loan sale and a shared national C&I credit, while total past dues were 0.13% of total loans outstanding.
  • Provision for credit losses of $72.6 million increased $33.7 million sequentially and rose $47.0 million compared to the third quarter 2022.
    • Drivers of the quarter-over-quarter and year-over-year increases included higher net charge-offs and increases of 3 bps and 9 bps, respectively, in the allowance for credit losses coverage ratio (to loans), reflecting migration trends and the uncertain economic environment.
 
 

Capital Ratios

 

 

 

 

 

 

 

 

3Q23

 

 

2Q23

 

 

3Q22

 

Common equity Tier 1 capital (CET1) ratio

10.13

%

*

9.86

%

 

9.52

%

Tier 1 capital ratio

11.18

 

*

10.89

 

 

10.59

 

Total risk-based capital ratio

13.12

 

*

12.80

 

 

12.45

 

Tier 1 leverage ratio

9.38

 

*

9.23

 

 

9.04

 

Tangible common equity ratio

5.90

 

 

6.17

 

 

5.52

 

* Ratios are preliminary.

Capital

  • The preliminary CET1 ratio improved 27 bps during the quarter to 10.13%, and the preliminary total risk-based capital ratio of 13.12% increased 32 bps from the previous quarter as capital preservation remains the near-term priority given persistent economic uncertainty.

Third Quarter Earnings Conference Call

Synovus will host an earnings highlights conference call at 8:30 a.m. ET on October 19, 2023. The earnings call will be accompanied by a slide presentation. Shareholders and other interested parties may listen to this conference call via simultaneous internet broadcast. For a link to the webcast, go to investor.synovus.com/event. The replay will be archived for 12 months and will be available 30-45 minutes after the call.

Synovus Financial Corp. is a financial services company based in Columbus, Georgia, with approximately $59 billion in assets. Synovus provides commercial and consumer banking and a full suite of specialized products and services, including private banking, treasury management, wealth management, mortgage services, premium finance, asset-based lending, structured lending, capital markets and international banking. Synovus has 246 branches in Georgia, Alabama, South Carolina, Florida and Tennessee. Synovus is a Great Place to Work-Certified Company and is on the web at synovus.com and on Twitter, Facebook, LinkedIn and Instagram.

Forward-Looking Statements

This press release and certain of our other filings with the Securities and Exchange Commission contain statements that constitute “forward-looking statements” within the meaning of, and subject to the protections of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are forward-looking statements. You can identify these forward-looking statements through Synovus’ use of words such as “believes,” “anticipates,” “expects,” “may,” “will,” “assumes,” “should,” “predicts,” “could,” “would,” “intends,” “targets,” “estimates,” “projects,” “plans,” “potential” and other similar words and expressions of the future or otherwise regarding the outlook for Synovus’ future business and financial performance and/or the performance of the banking industry and economy in general. These forward-looking statements include, among others, our expectations regarding our future operating and financial performance; expectations on our growth strategy, expense and revenue initiatives, capital management, balance sheet management, and future profitability; expectations on credit quality and performance; and the assumptions underlying our expectations. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve known and unknown risks and uncertainties which may cause the actual results, performance or achievements of Synovus to be materially different from the future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements are based on the information known to, and current beliefs and expectations of, Synovus’ management and are subject to significant risks and uncertainties. Actual results may differ materially from those contemplated by such forward-looking statements. A number of factors could cause actual results to differ materially from those contemplated by the forward-looking statements in this press release. Many of these factors are beyond Synovus’ ability to control or predict.

These forward-looking statements are based upon information presently known to Synovus’ management and are inherently subjective, uncertain and subject to change due to any number of risks and uncertainties, including, without limitation, the risks and other factors set forth in Synovus’ filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2022, under the captions “Cautionary Notice Regarding Forward-Looking Statements” and “Risk Factors” and in Synovus’ quarterly reports on Form 10-Q and current reports on Form 8-K. We believe these forward-looking statements are reasonable; however, undue reliance should not be placed on any forward-looking statements, which are based on current expectations and speak only as of the date that they are made. We do not assume any obligation to update any forward-looking statements as a result of new information, future developments or otherwise, except as otherwise may be required by law.

Non-GAAP Financial Measures

The measures entitled adjusted non-interest revenue, non-interest expense; adjusted revenue; adjusted tangible efficiency ratio; adjusted net income available to common shareholders; adjusted diluted earnings per share; adjusted return on average assets; adjusted return on average common equity; return on average tangible common equity; adjusted return on average tangible common equity; and tangible common equity ratio are not measures recognized under GAAP and therefore are considered non-GAAP financial measures. The most comparable GAAP measures to these measures are total non-interest revenue; total non-interest expense; total revenue; efficiency ratio-TE; net income available to common shareholders; diluted earnings per share; return on average assets; return on average common equity; and the ratio of total Synovus Financial Corp. shareholders' equity to total assets, respectively.

Management believes that these non-GAAP financial measures provide meaningful additional information about Synovus to assist management and investors in evaluating Synovus’ operating results, financial strength, the performance of its business, and the strength of its capital position. However, these non-GAAP financial measures have inherent limitations as analytical tools and should not be considered in isolation or as a substitute for analyses of operating results or capital position as reported under GAAP. The non-GAAP financial measures should be considered as additional views of the way our financial measures are affected by significant items and other factors, and since they are not required to be uniformly applied, they may not be comparable to other similarly titled measures at other companies. Adjusted non-interest revenue and adjusted revenue are measures used by management to evaluate non-interest revenue and total revenue exclusive of fair value adjustment on non-qualified deferred compensation and other items not indicative of ongoing operations that could impact period-to-period comparisons. Adjusted non-interest expense and the adjusted tangible efficiency ratio are measures utilized by management to measure the success of expense management initiatives focused on reducing recurring controllable operating costs. Adjusted net income available to common shareholders, adjusted diluted earnings per share, adjusted return on average assets, and adjusted return on average common equity are measures used by management to evaluate operating results exclusive of items that are not indicative of ongoing operations and impact period-to-period comparisons. Return on average tangible common equity and adjusted return on average tangible common equity are measures used by management to compare Synovus’ performance with other financial institutions because it calculates the return available to common shareholders without the impact of intangible assets and their related amortization, thereby allowing management to evaluate the performance of the business consistently. The tangible common equity ratio is used by management to assess the strength of our capital position. The computations of these measures are set forth in the tables below.

 
 

Reconciliation of Non-GAAP Financial Measures

 

 

 

 

 

 

 

 

 

 

 

(dollars in thousands)

 

3Q23

 

 

 

2Q23

 

 

 

3Q22

 

 

 

 

 

 

 

Adjusted non-interest revenue

 

 

 

 

 

Total non-interest revenue

$

107,139

 

 

$

112,276

 

 

$

104,298

 

Gain on sale of GLOBALT

 

(1,929

)

 

 

 

 

 

 

Fair value adjustment on non-qualified deferred compensation

 

1,035

 

 

 

(1,598

)

 

 

1,076

 

Adjusted non-interest revenue

$

106,245

 

 

$

110,678

 

 

$

105,374

 

 

 

 

 

 

 

Adjusted non-interest expense

 

 

 

 

 

Total non-interest expense

$

353,532

 

 

$

307,181

 

 

$

294,010

 

(Loss) gain on other loans held for sale

 

(30,954

)

 

 

(2,360

)

 

 

 

Gain (loss) on early extinguishment of debt

 

526

 

 

 

377

 

 

 

 

Restructuring (charges) reversals

 

(17,319

)

 

 

110

 

 

 

(956

)

Valuation adjustment to Visa derivative

 

(900

)

 

 

(3,027

)

 

 

 

Fair value adjustment on non-qualified deferred compensation

 

1,035

 

 

 

(1,598

)

 

 

1,076

 

Adjusted non-interest expense

$

305,920

 

 

$

300,683

 

 

$

294,130

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Non-GAAP Financial Measures, continued

 

 

 

 

 

 

 

 

 

 

 

(dollars in thousands)

 

3Q23

 

 

 

2Q23

 

 

 

3Q22

 

Adjusted revenue and tangible efficiency ratio

 

 

 

 

 

Adjusted non-interest expense

$

305,920

 

 

$

300,683

 

 

$

294,130

 

Amortization of intangibles

 

(3,042

)

 

 

(2,420

)

 

 

(2,118

)

Adjusted tangible non-interest expense

$

302,878

 

 

$

298,263

 

 

$

292,012

 

 

 

 

 

 

 

Net interest income

$

443,159

 

 

$

455,531

 

 

$

477,919

 

Total non-interest revenue

 

107,139

 

 

 

112,276

 

 

 

104,298

 

Total revenue

$

550,298

 

 

$

567,807

 

 

$

582,217

 

Tax equivalent adjustment

 

1,148

 

 

 

1,138

 

 

 

972

 

Total TE revenue

 

551,446

 

 

 

568,945

 

 

 

583,189

 

Gain on sale of GLOBALT

 

(1,929

)

 

 

 

 

 

 

Fair value adjustment on non-qualified deferred compensation

 

1,035

 

 

 

(1,598

)

 

 

1,076

 

Adjusted revenue

$

550,552

 

 

$

567,347

 

 

$

584,265

 

Efficiency ratio-TE

 

64.11

%

 

 

53.99

%

 

 

50.41

%

Adjusted tangible efficiency ratio

 

55.01

 

 

 

52.57

 

 

 

49.98

 

 

 

 

 

 

 

 

 
 

Adjusted return on average assets

 

 

 

 

 

Net income

$

96,465

 

 

$

173,944

 

 

$

203,044

 

Loss (gain) on other loans held for sale

 

30,954

 

 

 

2,360

 

 

 

 

(Gain) loss on early extinguishment of debt

 

(526

)

 

 

(377

)

 

 

 

Gain on sale of GLOBALT

 

(1,929

)

 

 

 

 

 

 

Restructuring charges (reversals)

 

17,319

 

 

 

(110

)

 

 

956

 

Valuation adjustment to Visa derivative

 

900

 

 

 

3,027

 

 

 

 

Tax effect of adjustments(1)

 

(11,371

)

 

 

(1,193

)

 

 

(228

)

Adjusted net income

$

131,812

 

 

$

177,651

 

 

$

203,772

 

Net income annualized

$

382,714

 

 

$

697,687

 

 

$

805,555

 

Adjusted net income annualized

$

522,950

 

 

$

712,556

 

 

$

808,443

 

Total average assets

$

59,916,679

 

 

$

60,515,077

 

 

$

58,055,978

 

Return on average assets

 

0.64

%

 

 

1.15

%

 

 

1.39

%

Adjusted return on average assets

 

0.87

 

 

 

1.18

 

 

 

1.39

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted net income available to common shareholders and adjusted diluted earnings per share

 

 

 

 

 

Net income available to common shareholders

$

87,423

 

 

$

165,819

 

 

$

194,753

 

Gain on sale of GLOBALT

 

(1,929

)

 

 

 

 

 

 

Loss (gain) on other loans held for sale

 

30,954

 

 

 

2,360

 

 

 

 

(Gain) loss on early extinguishment of debt

 

(526

)

 

 

(377

)

 

 

 

Restructuring charges (reversals)

 

17,319

 

 

 

(110

)

 

 

956

 

Valuation adjustment to Visa derivative

 

900

 

 

 

3,027

 

 

 

 

Tax effect of adjustments(1)

 

(11,371

)

 

 

(1,193

)

 

 

(228

)

Adjusted net income available to common shareholders

$

122,770

 

 

$

169,526

 

 

$

195,481

 

Weighted average common shares outstanding, diluted

 

146,740

 

 

 

146,550

 

 

 

146,418

 

Diluted earnings per share

$

0.60

 

 

$

1.13

 

 

$

1.33

 

Adjusted diluted earnings per share

 

0.84

 

 

 

1.16

 

 

 

1.34

 

 
 
 
 

Reconciliation of Non-GAAP Financial Measures, continued

 

 

 

 

 

 

 

 

 

 

 

(dollars in thousands)

 

3Q23

 

 

 

2Q23

 

 

 

3Q22

 

Adjusted return on average common equity, return on average tangible common equity, and adjusted return on average tangible common equity

 

 

 

 

 

Net income available to common shareholders

$

87,423

 

 

$

165,819

 

 

$

194,753

 

Loss (gain) on other loans held for sale

 

30,954

 

 

 

2,360

 

 

 

 

(Gain) loss on early extinguishment of debt

 

(526

)

 

 

(377

)

 

 

 

Gain on sale of GLOBALT

 

(1,929

)

 

 

 

 

 

 

Restructuring charges (reversals)

 

17,319

 

 

 

(110

)

 

 

956

 

Valuation adjustment to Visa derivative

 

900

 

 

 

3,027

 

 

 

 

Tax effect of adjustments(1)

 

(11,371

)

 

 

(1,193

)

 

 

(228

)

Adjusted net income available to common shareholders

$

122,770

 

 

$

169,526

 

 

$

195,481

 

 

 

 

 

 

 

Adjusted net income available to common shareholders annualized

$

487,077

 

 

$

679,967

 

 

$

775,550

 

Amortization of intangibles, tax effected, annualized

 

9,131

 

 

 

7,344

 

 

 

6,401

 

Adjusted net income available to common shareholders excluding amortization of intangibles annualized

$

496,208

 

 

$

687,311

 

 

$

781,951

 

 

 

 

 

 

 

Net income available to common shareholders annualized

$

346,841

 

 

$

665,098

 

 

$

772,661

 

Amortization of intangibles, tax effected, annualized

 

9,131

 

 

 

7,344

 

 

 

6,401

 

Net income available to common shareholders excluding amortization of intangibles annualized

$

355,972

 

 

$

672,442

 

 

$

779,062

 

 

 

 

 

 

 

Total average Synovus Financial Corp. shareholders' equity less preferred stock

$

4,223,422

 

 

$

4,303,722

 

 

$

4,141,516

 

Average goodwill

 

(476,408

)

 

 

(460,118

)

 

 

(452,390

)

Average other intangible assets, net

 

(59,016

)

 

 

(36,738

)

 

 

(30,214

)

Total average Synovus Financial Corp. tangible shareholders' equity less preferred stock

$

3,687,998

 

 

$

3,806,866

 

 

$

3,658,912

 

Return on average common equity

 

8.2

%

 

 

15.5

%

 

 

18.7

%

Adjusted return on average common equity

 

11.5

 

 

 

15.8

 

 

 

18.7

 

Return on average tangible common equity

 

9.7

 

 

 

17.7

 

 

 

21.3

 

Adjusted return on average tangible common equity

 

13.5

 

 

 

18.1

 

 

 

21.4

 

 
 

 

 

 

 

 

 

 

 

 

 

 

 

(dollars in thousands)

September 30, 2023

 

December 31, 2022

 

September 30, 2022

 

 

 

 

 

 

Tangible common equity ratio

 

 

 

 

 

Total assets

$

59,342,930

 

 

$

59,731,378

 

 

$

58,639,522

 

Goodwill

 

(479,851

)

 

 

(452,390

)

 

 

(452,390

)

Other intangible assets, net

 

(49,096

)

 

 

(27,124

)

 

 

(29,242

)

Tangible assets

$

58,813,983

 

 

$

59,251,864

 

 

$

58,157,890

 

 

 

 

 

 

 

Total Synovus Financial Corp. shareholders’ equity

$

4,536,958

 

 

$

4,475,801

 

 

$

4,229,715

 

Goodwill

 

(479,851

)

 

 

(452,390

)

 

 

(452,390

)

Other intangible assets, net

 

(49,096

)

 

 

(27,124

)

 

 

(29,242

)

Preferred Stock, no par value

 

(537,145

)

 

 

(537,145

)

 

 

(537,145

)

Tangible common equity

$

3,470,866

 

 

$

3,459,142

 

 

$

3,210,938

 

Total Synovus Financial Corp. shareholders’ equity to total assets ratio

 

7.65

%

 

 

7.49

%

 

 

7.21

%

Tangible common equity ratio

 

5.90

 

 

 

5.84

 

 

 

5.52

 

 

 

 

 

 

 

(1) An assumed marginal tax rate of 24.3% for 3Q23 and 2Q23 and 23.8% for 3Q22 was applied.

 

 

 

 

 

Amounts may not total due to rounding

 

 

 

 

 

 
 
 
 

Synovus

 

 

INCOME STATEMENT DATA

 

 

 

 

 

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

(Dollars in thousands, except per share data)

Nine Months Ended September 30,

 

 

 

 

 

 

 

2023

 

2022

 

'23 vs '22

 

 

 

% Change

 

 

 

 

 

 

Interest income

$

2,262,061

 

 

$

1,421,133

 

 

59

%

Interest expense

 

882,619

 

 

 

125,578

 

 

603

 

 

 

 

 

 

 

Net interest income

 

1,379,442

 

 

 

1,295,555

 

 

6

 

Provision for (reversal of) credit losses

 

143,607

 

 

 

49,669

 

 

189

 

 

 

 

 

 

 

Net interest income after provision for credit losses

 

1,235,835

 

 

 

1,245,886

 

 

(1

)

 

 

 

 

 

 

Non-interest revenue:

 

 

 

 

 

Service charges on deposit accounts

 

67,836

 

 

 

69,428

 

 

(2

)

Fiduciary and asset management fees

 

59,928

 

 

 

59,577

 

 

1

 

Card fees

 

51,485

 

 

 

45,946

 

 

12

 

Brokerage revenue

 

63,703

 

 

 

47,038

 

 

35

 

Mortgage banking income

 

12,138

 

 

 

14,922

 

 

(19

)

Capital markets income

 

27,077

 

 

 

19,704

 

 

37

 

Income from bank-owned life insurance

 

21,106

 

 

 

22,514

 

 

(6

)

Investment securities gains (losses), net

 

1,030

 

 

 

 

 

nm

 

Recovery of NPA

 

13,126

 

 

 

 

 

nm

 

Other non-interest revenue

 

35,112

 

 

 

27,768

 

 

26

 

 

 

 

 

 

 

Total non-interest revenue

 

352,541

 

 

 

306,897

 

 

15

 

 

 

 

 

 

 

Non-interest expense:

 

 

 

 

 

Salaries and other personnel expense

 

551,667

 

 

 

499,081

 

 

11

 

Net occupancy, equipment, and software expense

 

131,435

 

 

 

129,538

 

 

1

 

Third-party processing and other services

 

64,932

 

 

 

65,486

 

 

(1

)

Professional fees

 

28,707

 

 

 

26,094

 

 

10

 

FDIC insurance and other regulatory fees

 

33,266

 

 

 

20,851

 

 

60

 

Restructuring charges (reversals)

 

16,476

 

 

 

(7,318

)

 

nm

 

Loss on other loans held for sale

 

50,064

 

 

 

 

 

nm

 

Other operating expenses

 

106,019

 

 

 

114,779

 

 

(8

)

 

 

 

 

 

 

Total non-interest expense

 

982,566

 

 

 

848,511

 

 

16

 

 

 

 

 

 

 

Income before income taxes

 

605,810

 

 

 

704,272

 

 

(14

)

Income tax expense

 

133,242

 

 

 

152,140

 

 

(12

)

 

 

 

 

 

 

Net income

 

472,568

 

 

 

552,132

 

 

(14

)

 

 

 

 

 

 

Less: Net income attributable to noncontrolling interest

 

(796

)

 

 

 

 

nm

 

 

 

 

 

 

 

Net income attributable to Synovus Financial Corp.

 

473,364

 

 

 

552,132

 

 

(14

)

 

 

 

 

 

 

Less: Preferred stock dividends

 

26,254

 

 

 

24,872

 

 

6

 

 

 

 

 

 

 

Net income available to common shareholders

$

447,110

 

 

$

527,260

 

 

(15

)%

 

 

 

 

 

 

Net income per common share, basic

$

3.06

 

 

$

3.63

 

 

(16

)%

 

 

 

 

 

 

Net income per common share, diluted

 

3.05

 

 

 

3.60

 

 

(15

)

 

 

 

 

 

 

Cash dividends declared per common share

 

1.14

 

 

 

1.02

 

 

12

 

 

 

 

 

 

 

Return on average assets *

 

1.05

%

 

 

1.29

%

 

(24) bps

 

Return on average common equity *

 

14.23

 

 

 

16.37

 

 

(214

)

 

 

 

 

 

 

Weighted average common shares outstanding, basic

 

146,028

 

 

 

145,329

 

 

%

Weighted average common shares outstanding, diluted

 

146,683

 

 

 

146,465

 

 

 

 

 

 

 

 

 

nm - not meaningful

 

 

 

 

 

bps - basis points

 

 

 

 

 

* - ratios are annualized

 

 

 

 

 

Amounts may not total due to rounding

 

 

 

 

 

 
 
 
 

Synovus

 

 

 

 

 

 

 

 

 

 

 

INCOME STATEMENT DATA

 

 

 

 

 

 

 

 

 

 

 

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in thousands, except per share data)

2023

 

2022

 

Third Quarter

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter

 

Second Quarter

 

First Quarter

 

Fourth Quarter

 

Third Quarter

 

'23 vs '22

 

 

 

 

 

% Change

 

 

 

 

 

 

 

 

 

 

 

 

Interest income

$

786,039

 

 

759,143

 

 

716,879

 

 

654,654

 

 

551,299

 

43

%

Interest expense

 

342,880

 

 

303,612

 

 

236,128

 

 

153,308

 

 

73,380

 

367

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income

 

443,159

 

 

455,531

 

 

480,751

 

 

501,346

 

 

477,919

 

(7

)

Provision for (reversal of) credit losses

 

72,572

 

 

38,881

 

 

32,154

 

 

34,884

 

 

25,581

 

184

 

 

 

 

 

 

 

 

 

 

 

 

 

Net interest income after provision for credit losses

 

370,587

 

 

416,650

 

 

448,597

 

 

466,462

 

 

452,338

 

(18

)

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest revenue:

 

 

 

 

 

 

 

 

 

 

 

Service charges on deposit accounts

 

21,385

 

 

23,477

 

 

22,974

 

 

23,639

 

 

23,398

 

(9

)

Fiduciary and asset management fees

 

20,205

 

 

20,027

 

 

19,696

 

 

18,836

 

 

19,201

 

5

 

Card fees

 

18,602

 

 

17,059

 

 

15,824

 

 

15,887

 

 

15,101

 

23

 

Brokerage revenue

 

20,237

 

 

20,908

 

 

22,558

 

 

19,996

 

 

17,140

 

18

 

Mortgage banking income

 

3,671

 

 

4,609

 

 

3,858

 

 

2,554

 

 

5,065

 

(28

)

Capital markets income

 

6,377

 

 

6,975

 

 

13,725

 

 

6,998

 

 

6,839

 

(7

)

Income from bank-owned life insurance

 

6,965

 

 

6,878

 

 

7,262

 

 

7,206

 

 

6,792

 

3

 

Investment securities gains (losses), net

 

 

 

 

 

1,030

 

 

 

 

 

nm

 

Recovery of NPA

 

 

 

 

 

13,126

 

 

 

 

 

nm

 

Other non-interest revenue

 

9,697

 

 

12,343

 

 

13,073

 

 

7,323

 

 

10,762

 

(10

)

 

 

 

 

 

 

 

 

 

 

 

 

Total non-interest revenue

 

107,139

 

 

112,276

 

 

133,126

 

 

102,439

 

 

104,298

 

3

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-interest expense:

 

 

 

 

 

 

 

 

 

 

 

Salaries and other personnel expense

 

179,741

 

 

183,001

 

 

188,924

 

 

182,629

 

 

173,334

 

4

 

Net occupancy, equipment, and software expense

 

45,790

 

 

42,785

 

 

42,860

 

 

45,192

 

 

43,462

 

5

 

Third-party processing and other services

 

21,439

 

 

21,659

 

 

21,833

 

 

23,130

 

 

22,539

 

(5

)

Professional fees

 

10,147

 

 

9,597

 

 

8,963

 

 

11,096

 

 

6,755

 

50

 

FDIC insurance and other regulatory fees

 

11,837

 

 

11,162

 

 

10,268

 

 

8,232

 

 

7,707

 

54

 

Restructuring charges (reversals)

 

17,319

 

 

(110

)

 

(733

)

 

(2,372

)

 

956

 

nm

 

Loss on other loans held for sale

 

30,954

 

 

2,360

 

 

16,750

 

 

 

 

 

nm

 

Other operating expenses

 

36,305

 

 

36,727

 

 

32,987

 

 

41,089

 

 

39,257

 

(8

)

 

 

 

 

 

 

 

 

 

 

 

 

Total non-interest expense

 

353,532

 

 

307,181

 

 

321,852

 

 

308,996

 

 

294,010

 

20

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before income taxes

 

124,194

 

 

221,745

 

 

259,871

 

 

259,905

 

 

262,626

 

(53

)

Income tax expense

 

27,729

 

 

47,801

 

 

57,712

 

 

54,135

 

 

59,582

 

(53

)

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

96,465

 

 

173,944

 

 

202,159

 

 

205,770

 

 

203,044

 

(52

)

 

 

 

 

 

 

 

 

 

 

 

 

Less: Net income attributable to noncontrolling interest

 

(630

)

 

(166

)

 

 

 

 

 

 

nm

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to Synovus Financial Corp.

 

97,095

 

 

174,110

 

 

202,159

 

 

205,770

 

 

203,044

 

(52

)

 

 

 

 

 

 

 

 

 

 

 

 

Less: Preferred stock dividends

 

9,672

 

 

8,291

 

 

8,291

 

 

8,291

 

 

8,291

 

17

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income available to common shareholders

$

87,423

 

 

165,819

 

 

193,868

 

 

197,479

 

 

194,753

 

(55

)%

 

 

 

 

 

 

 

 

 

 

 

 

Net income per common share, basic

$

0.60

 

 

1.13

 

 

1.33

 

 

1.36

 

 

1.34

 

(55

)%

 

 

 

 

 

 

 

 

 

 

 

 

Net income per common share, diluted

 

0.60

 

 

1.13

 

 

1.32

 

 

1.35

 

 

1.33

 

(55

)

 

 

 

 

 

 

 

 

 

 

 

 

Cash dividends declared per common share

 

0.38

 

 

0.38

 

 

0.38

 

 

0.34

 

 

0.34

 

12

 

 

 

 

 

 

 

 

 

 

 

 

 

Return on average assets *

 

0.64

%

 

1.15

 

 

1.36

 

 

1.38

 

 

1.39

 

(75) bps

Return on average common equity *

 

8.2

 

 

15.5

 

 

19.2

 

 

20.9

 

 

18.7

 

(1,050

)

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding, basic

 

146,170

 

 

146,113

 

 

145,799

 

 

145,467

 

 

145,386

 

1

%

Weighted average common shares outstanding, diluted

 

146,740

 

 

146,550

 

 

146,727

 

 

146,528

 

 

146,418

 

 

 

 

 

 

 

 

 

 

 

 

 

 

nm - not meaningful

 

 

 

 

 

 

 

 

 

 

 

bps - basis points

 

 

 

 

 

 

 

 

 

 

 

* - ratios are annualized

 

 

 

 

 

 

 

 

 

 

 

Amounts may not total due to rounding

 

 

 

 

 

 

 

 

 

 

 

 
 
 
 

Synovus

 

 

 

 

 

 

 

 

 

 

 

 

 

BALANCE SHEET DATA

 

September 30, 2023

 

December 31, 2022

 

September 30, 2022

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands, except share data)

 

 

 

 

 

 

 

 

 

 

 

 

 

ASSETS

 

 

 

 

 

 

Cash and due from banks

 

$

604,631

 

 

$

624,097

 

 

$

516,163

 

Interest-bearing funds with Federal Reserve Bank

 

 

1,431,356

 

 

 

1,280,684

 

 

 

1,260,748

 

Interest earning deposits with banks

 

 

65,468

 

 

 

34,632

 

 

 

32,445

 

Federal funds sold and securities purchased under resale agreements

 

 

36,176

 

 

 

38,367

 

 

 

58,448

 

Cash, cash equivalents, and restricted cash

 

 

2,137,631

 

 

 

1,977,780

 

 

 

1,867,804

 

 

 

 

 

 

 

 

Investment securities available for sale, at fair value

 

 

9,237,191

 

 

 

9,678,103

 

 

 

9,587,508

 

Loans held for sale (includes $48,994, $51,136 and $56,517 measured at fair value, respectively)

 

 

66,558

 

 

 

391,502

 

 

 

696,450

 

 

 

 

 

 

 

 

Loans, net of deferred fees and costs

 

 

43,679,910

 

 

 

43,716,353

 

 

 

42,571,458

 

Allowance for loan losses

 

 

(477,532

)

 

 

(443,424

)

 

 

(421,359

)

Loans, net

 

 

43,202,378

 

 

 

43,272,929

 

 

 

42,150,099

 

 

 

 

 

 

 

 

Cash surrender value of bank-owned life insurance

 

 

1,107,092

 

 

 

1,089,280

 

 

 

1,084,060

 

Premises, equipment, and software, net

 

 

364,054

 

 

 

370,632

 

 

 

376,823

 

Goodwill

 

 

479,851

 

 

 

452,390

 

 

 

452,390

 

Other intangible assets, net

 

 

49,096

 

 

 

27,124

 

 

 

29,242

 

Other assets

 

 

2,699,079

 

 

 

2,471,638

 

 

 

2,395,146

 

Total assets

 

$

59,342,930

 

 

$

59,731,378

 

 

$

58,639,522

 

 

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

Liabilities:

 

 

 

 

 

 

Deposits:

 

 

 

 

 

 

Non-interest-bearing deposits

 

$

12,976,574

 

 

$

15,639,899

 

 

$

16,359,551

 

Interest-bearing deposits

 

 

37,227,316

 

 

 

33,231,660

 

 

 

31,338,013

 

 

 

 

 

 

 

 

Total deposits

 

 

50,203,890

 

 

 

48,871,559

 

 

 

47,697,564

 

 

 

 

 

 

 

 

Federal funds purchased and securities sold under repurchase agreements

 

 

98,270

 

 

 

146,588

 

 

 

240,210

 

Other short-term borrowings

 

 

2,362

 

 

 

603,384

 

 

 

614,232

 

Long-term debt

 

 

2,704,701

 

 

 

4,109,597

 

 

 

4,434,327

 

Other liabilities

 

 

1,772,139

 

 

 

1,524,449

 

 

 

1,423,474

 

Total liabilities

 

 

54,781,362

 

 

 

55,255,577

 

 

 

54,409,807

 

 

 

 

 

 

 

 

Equity:

 

 

 

 

 

 

Shareholders' equity:

 

 

 

 

 

 

Preferred stock - no par value. Authorized 100,000,000 shares; issued 22,000,000

 

 

537,145

 

 

 

537,145

 

 

 

537,145

 

Common stock - $1.00 par value. Authorized 342,857,143 shares; issued 170,859,506, 170,141,492 and 170,097,791 respectively; outstanding 146,204,648, 145,486,634 and 145,442,933 respectively

 

 

170,860

 

 

 

170,141

 

 

 

170,098

 

Additional paid-in capital

 

 

3,940,507

 

 

 

3,920,346

 

 

 

3,916,729

 

Treasury stock, at cost; 24,654,858 shares

 

 

(944,484

)

 

 

(944,484

)

 

 

(944,484

)

Accumulated other comprehensive income (loss), net

 

 

(1,679,404

)

 

 

(1,442,117

)

 

 

(1,534,314

)

Retained earnings

 

 

2,512,334

 

 

 

2,234,770

 

 

 

2,084,541

 

Total Synovus Financial Corp. shareholders’ equity

 

 

4,536,958

 

 

 

4,475,801

 

 

 

4,229,715

 

Noncontrolling interest in subsidiary

 

 

24,610

 

 

 

 

 

 

 

Total equity

 

 

4,561,568

 

 

 

4,475,801

 

 

 

4,229,715

 

Total liabilities and equity

 

$

59,342,930

 

 

$

59,731,378

 

 

$

58,639,522

 

 
 
 
 

Synovus

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AVERAGE BALANCES, INTEREST, AND YIELDS/RATES

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third Quarter 2023

 

Second Quarter 2023

 

Third Quarter 2022

(dollars in thousands)

Average Balance

 

Interest

 

Yield/

Rate

 

Average Balance

 

Interest

 

Yield/

Rate

 

Average Balance

 

Interest

 

Yield/

Rate

Assets

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Commercial loans (1) (2) (3)

$

34,990,459

 

 

$

579,177

 

6.57

%

 

$

35,628,637

 

 

$

566,823

 

6.38

%

 

$

32,836,799

 

 

$

384,995

 

4.65

%

Consumer loans (1) (2)

 

8,509,757

 

 

 

108,065

 

5.06

 

 

 

8,470,478

 

 

 

104,545

 

4.94

 

 

 

8,931,573

 

 

 

94,425

 

4.21

 

Less: Allowance for loan losses

 

(461,385

)

 

 

 

 

 

 

(466,700

)

 

 

 

 

 

 

(419,160

)

 

 

 

 

Loans, net

 

43,038,831

 

 

 

687,242

 

6.34

 

 

 

43,632,415

 

 

 

671,368

 

6.17

 

 

 

41,349,212

 

 

 

479,420

 

4.60

 

Investment securities available for sale

 

11,194,291

 

 

 

61,642

 

2.20

 

 

 

11,200,717

 

 

 

60,421

 

2.16

 

 

 

11,126,705

 

 

 

53,550

 

1.92

 

Trading account assets

 

16,186

 

 

 

237

 

5.86

 

 

 

21,328

 

 

 

309

 

5.80

 

 

 

16,771

 

 

 

81

 

1.93

 

Other earning assets(4)

 

1,237,445

 

 

 

16,369

 

5.17

 

 

 

1,446,425

 

 

 

18,081

 

4.95

 

 

 

1,012,717

 

 

 

5,791

 

2.24

 

FHLB and Federal Reserve Bank stock

 

244,906

 

 

 

3,783

 

6.18

 

 

 

280,248

 

 

 

4,301

 

6.14

 

 

 

244,879

 

 

 

1,412

 

2.31

 

Mortgage loans held for sale

 

53,904

 

 

 

879

 

6.52

 

 

 

54,603

 

 

 

852

 

6.24

 

 

 

66,601

 

 

 

862

 

5.18

 

Other loans held for sale

 

881,067

 

 

 

17,035

 

7.57

 

 

 

546,224

 

 

 

4,949

 

3.58

 

 

 

892,805

 

 

 

11,155

 

4.89

 

Total interest earning assets

 

56,666,630

 

 

$

787,187

 

5.51

%

 

 

57,181,960

 

 

$

760,281

 

5.33

%

 

 

54,709,690

 

 

$

552,271

 

4.00

%

Cash and due from banks

 

509,511

 

 

 

 

 

 

 

646,066

 

 

 

 

 

 

 

557,537

 

 

 

 

 

Premises and equipment

 

365,568

 

 

 

 

 

 

 

369,039

 

 

 

 

 

 

 

383,189

 

 

 

 

 

Other real estate

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

2,398

 

 

 

 

 

Cash surrender value of bank-owned life insurance

 

1,102,626

 

 

 

 

 

 

 

1,095,866

 

 

 

 

 

 

 

1,080,914

 

 

 

 

 

Other assets(5)

 

1,272,344

 

 

 

 

 

 

 

1,222,146

 

 

 

 

 

 

 

1,322,251

 

 

 

 

 

Total assets

$

59,916,679

 

 

 

 

 

 

$

60,515,077

 

 

 

 

 

 

$

58,055,979

 

 

 

 

 

Liabilities and Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing demand deposits

$

10,114,171

 

 

$

52,983

 

2.08

%

 

$

9,891,375

 

 

$

41,803

 

1.70

%

 

$

8,437,408

 

 

$

5,782

 

0.27

%

Money market accounts

 

13,147,465

 

 

 

95,339

 

2.88

 

 

 

13,468,210

 

 

 

85,397

 

2.54

 

 

 

15,410,964

 

 

 

20,696

 

0.53

 

Savings deposits

 

1,178,322

 

 

 

280

 

0.09

 

 

 

1,276,040

 

 

 

281

 

0.09

 

 

 

1,508,312

 

 

 

84

 

0.02

 

Time deposits

 

6,180,584

 

 

 

59,972

 

3.85

 

 

 

4,866,221

 

 

 

39,551

 

3.26

 

 

 

2,270,163

 

 

 

2,428

 

0.42

 

Brokered deposits

 

6,442,690

 

 

 

83,486

 

5.14

 

 

 

6,342,751

 

 

 

74,748

 

4.73

 

 

 

3,899,669

 

 

 

17,927

 

1.82

 

Federal funds purchased and securities sold under repurchase agreements

 

73,344

 

 

 

296

 

1.58

 

 

 

88,591

 

 

 

351

 

1.57

 

 

 

240,412

 

 

 

641

 

1.04

 

Other short-term borrowings

 

1,722

 

 

 

 

 

 

 

455,050

 

 

 

5,566

 

4.84

 

 

 

709,078

 

 

 

3,666

 

2.02

 

Long-term debt

 

3,230,374

 

 

 

50,524

 

6.18

 

 

 

3,821,126

 

 

 

55,915

 

5.82

 

 

 

2,656,939

 

 

 

22,156

 

3.29

 

Total interest-bearing liabilities

 

40,368,672

 

 

$

342,880

 

3.37

%

 

 

40,209,364

 

 

$

303,612

 

3.03

%

 

 

35,132,945

 

 

$

73,380

 

0.83

%

Non-interest-bearing demand deposits

 

13,049,343

 

 

 

 

 

 

 

13,874,482

 

 

 

 

 

 

 

16,904,353

 

 

 

 

 

Other liabilities

 

1,713,131

 

 

 

 

 

 

 

1,556,863

 

 

 

 

 

 

 

1,340,020

 

 

 

 

 

Total equity

 

4,785,533

 

 

 

 

 

 

 

4,874,368

 

 

 

 

 

 

 

4,678,661

 

 

 

 

 

Total liabilities and equity

$

59,916,679

 

 

 

 

 

 

$

60,515,077

 

 

 

 

 

 

$

58,055,979

 

 

 

 

 

Net interest income and net interest margin, taxable equivalent (6)

 

 

$

444,307

 

3.11

%

 

 

 

$

456,669

 

3.20

%

 

 

 

$

478,891

 

3.47

%

Less: taxable-equivalent adjustment

 

 

 

1,148

 

 

 

 

 

 

1,138

 

 

 

 

 

 

972

 

 

Net interest income

 

 

$

443,159

 

 

 

 

 

$

455,531

 

 

 

 

 

$

477,919

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
 

(1)

Average loans are shown net of deferred fees and costs. NPLs are included.

(2)

Interest income includes net loan fees as follows: Third Quarter 2023 — $11.8 million, Second Quarter 2023 — $11.3 million, and Third Quarter 2022 — $11.9 million.

(3)

Reflects taxable-equivalent adjustments, using the statutory federal tax rate of 21%, in adjusting interest on tax-exempt loans to a taxable-equivalent basis.

(4)

Includes interest-bearing funds with Federal Reserve Bank, interest earning deposits with banks, and federal funds sold and securities purchased under resale agreements.

(5)

Includes average net unrealized gains/(losses) on investment securities available for sale of $(1.60) billion, $(1.46) billion, and $(1.06) billion for the Third Quarter 2023, Second Quarter 2023, and Third Quarter 2022, respectively.

(6)

The net interest margin is calculated by dividing annualized net interest income-taxable equivalent by average total interest earning assets.

 
 

Synovus

 

 

 

 

 

 

 

 

 

 

 

AVERAGE BALANCES, INTEREST, AND YIELDS/RATES

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended September 30,

 

 

2023

 

2022

 

(dollars in thousands)

Average Balance

 

Interest

 

Yield/

Rate

 

Average Balance

 

Interest

 

Yield/

Rate

 

Assets

 

 

 

 

 

 

 

 

 

 

 

 

Interest earning assets:

 

 

 

 

 

 

 

 

 

 

 

 

Commercial loans (1) (2) (3)

$

35,216,487

 

 

$

1,672,529

 

6.35

%

 

$

31,828,932

 

 

$

974,024

 

4.09

%

 

Consumer loans (1) (2)

 

8,580,029

 

 

 

316,757

 

4.92

 

 

 

8,749,927

 

 

 

259,619

 

3.95

 

 

Less: Allowance for loan losses

 

(457,818

)

 

 

 

 

 

 

(419,478

)

 

 

 

 

 

Loans, net

 

43,338,698

 

 

 

1,989,286

 

6.14

 

 

 

40,159,381

 

 

 

1,233,643

 

4.11

 

 

Investment securities available for sale

 

11,229,290

 

 

 

183,118

 

2.17

 

 

 

11,179,378

 

 

 

151,111

 

1.80

 

 

Trading account assets

 

16,302

 

 

 

671

 

5.49

 

 

 

12,640

 

 

 

193

 

2.04

 

 

Other earning assets(4)

 

1,398,211

 

 

 

51,660

 

4.87

 

 

 

1,245,102

 

 

 

8,267

 

0.88

 

 

FHLB and Federal Reserve Bank stock

 

277,136

 

 

 

11,439

 

5.50

 

 

 

195,238

 

 

 

3,917

 

2.67

 

 

Mortgage loans held for sale

 

48,398

 

 

 

2,297

 

6.33

 

 

 

85,126

 

 

 

2,665

 

4.17

 

 

Other loans held for sale

 

625,262

 

 

 

26,995

 

5.69

 

 

 

739,627

 

 

 

24,133

 

4.30

 

 

Total interest earning assets

 

56,933,297

 

 

$

2,265,466

 

5.32

%

 

 

53,616,492

 

 

$

1,423,929

 

3.55

%

 

Cash and due from banks

 

593,023

 

 

 

 

 

 

 

548,322

 

 

 

 

 

 

Premises and equipment

 

367,332

 

 

 

 

 

 

 

389,083

 

 

 

 

 

 

Other real estate

 

 

 

 

 

 

 

 

8,498

 

 

 

 

 

 

Cash surrender value of bank-owned life insurance

 

1,096,567

 

 

 

 

 

 

 

1,076,381

 

 

 

 

 

 

Other assets(5)

 

1,187,026

 

 

 

 

 

 

 

1,515,226

 

 

 

 

 

 

Total assets

$

60,177,245

 

 

 

 

 

 

$

57,154,002

 

 

 

 

 

 

Liabilities and Equity

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing liabilities:

 

 

 

 

 

 

 

 

 

 

 

 

Interest-bearing demand deposits

$

9,702,651

 

 

$

118,007

 

1.63

%

 

$

9,162,684

 

 

$

11,752

 

0.17

%

 

Money market accounts

 

13,665,672

 

 

 

253,351

 

2.48

 

 

 

15,592,671

 

 

 

32,896

 

0.28

 

 

Savings deposits

 

1,274,142

 

 

 

771

 

0.08

 

 

 

1,491,893

 

 

 

223

 

0.02

 

 

Time deposits

 

4,892,146

 

 

 

121,019

 

3.31

 

 

 

2,700,505

 

 

 

6,254

 

0.31

 

 

Brokered deposits

 

6,116,392

 

 

 

214,627

 

4.69

 

 

 

3,192,848

 

 

 

27,952

 

1.17

 

 

Federal funds purchased and securities sold under repurchase agreements

 

98,212

 

 

 

1,317

 

1.77

 

 

 

227,335

 

 

 

871

 

0.51

 

 

Other short-term borrowings

 

705,292

 

 

 

24,559

 

4.59

 

 

 

400,862

 

 

 

4,561

 

1.50

 

 

Long-term debt

 

3,400,156

 

 

 

148,968

 

5.80

 

 

 

1,512,059

 

 

 

41,069

 

3.61

 

 

Total interest-bearing liabilities

 

39,854,663

 

 

$

882,619

 

2.96

%

 

 

34,280,857

 

 

$

125,578

 

0.49

%

 

Non-interest-bearing demand deposits

 

13,972,152

 

 

 

 

 

 

 

16,786,794

 

 

 

 

 

 

Other liabilities

 

1,592,230

 

 

 

 

 

 

 

1,243,900

 

 

 

 

 

 

Total equity

 

4,758,200

 

 

 

 

 

 

 

4,842,451

 

 

 

 

 

 

Total liabilities and equity

$

60,177,245

 

 

 

 

 

 

$

57,154,002

 

 

 

 

 

 

Net interest income, taxable equivalent net interest margin (6)

 

 

$

1,382,847

 

3.25

%

 

 

 

$

1,298,351

 

3.24

%

 

Less: taxable-equivalent adjustment

 

 

 

3,405

 

 

 

 

 

 

2,796

 

 

 

Net interest income

 

 

$

1,379,442

 

 

 

 

 

$

1,295,555

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 
 

(1)

Average loans are shown net of deferred fees and costs. NPLs are included.

(2)

Interest income includes net loan fees as follows: 2023 — $34.6 million and 2022 — $45.6 million.

(3)

Reflects taxable-equivalent adjustments, using the statutory federal tax rate of 21%, in adjusting interest on tax-exempt loans to a taxable-equivalent basis.

(4)

Includes interest-bearing funds with Federal Reserve Bank, interest earning deposits with banks, and federal funds sold and securities purchased under resale agreements.

(5)

Includes average net unrealized gains/(losses) on investment securities available for sale of $(1.53) billion and $(747.7) million for the nine months ended September 30, 2023 and 2022, respectively.

(6)

The net interest margin is calculated by dividing annualized net interest income-taxable equivalent by average total interest earning assets.

 
 

Synovus

LOANS OUTSTANDING BY TYPE

(Unaudited)

 

Total Loans

 

Total Loans

 

Linked Quarter

Total Loans

 

Year/Year

(Dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

Loan Type

 

September 30, 2023

 

June 30, 2023

 

% Change

 

September 30, 2022

 

% Change

Commercial, Financial, and Agricultural

 

$

14,498,966

 

$

14,166,890

 

2

%

 

$

13,254,966

 

9

%

Owner-Occupied

 

 

8,281,988

 

 

8,364,342

 

(1

)

 

 

7,957,550

 

4

 

Total Commercial & Industrial

 

 

22,780,954

 

 

22,531,232

 

1

 

 

 

21,212,516

 

7

 

Multi-Family

 

 

3,930,617

 

 

3,597,497

 

9

 

 

 

2,949,172

 

33

 

Hotels

 

 

1,790,094

 

 

1,771,381

 

1

 

 

 

1,712,016

 

5

 

Office Buildings

 

 

1,911,095

 

 

3,031,806

 

(37

)

 

 

2,945,771

 

(35

)

Shopping Centers

 

 

1,327,770

 

 

1,329,492

 

 

 

 

1,441,385

 

(8

)

Warehouses

 

 

985,723

 

 

1,068,734

 

(8

)

 

 

943,961

 

4

 

Other Investment Property

 

 

1,432,456

 

 

1,471,356

 

(3

)

 

 

1,246,099

 

15

 

Total Investment Properties

 

 

11,377,755

 

 

12,270,266

 

(7

)

 

 

11,238,404

 

1

 

1-4 Family Construction

 

 

224,091

 

 

205,459

 

9

 

 

 

249,840

 

(10

)

1-4 Family Investment Mortgage

 

 

396,813

 

 

410,267

 

(3

)

 

 

389,787

 

2

 

Total 1-4 Family Properties

 

 

620,904

 

 

615,726

 

1

 

 

 

639,627

 

(3

)

Commercial Development

 

 

64,212

 

 

60,910

 

5

 

 

 

92,159

 

(30

)

Residential Development

 

 

92,209

 

 

98,229

 

(6

)

 

 

119,019

 

(23

)

Land Acquisition

 

 

239,773

 

 

248,767

 

(4

)

 

 

198,756

 

21

 

Land and Development

 

 

396,194

 

 

407,906

 

(3

)

 

 

409,934

 

(3

)

Total Commercial Real Estate

 

 

12,394,853

 

 

13,293,898

 

(7

)

 

 

12,287,965

 

1

 

Consumer Mortgages

 

 

5,391,282

 

 

5,379,284

 

 

 

 

5,166,928

 

4

 

Home Equity

 

 

1,784,356

 

 

1,773,987

 

1

 

 

 

1,708,246

 

4

 

Credit Cards

 

 

191,046

 

 

187,677

 

2

 

 

 

197,978

 

(4

)

Other Consumer Loans

 

 

1,137,419

 

 

1,187,459

 

(4

)

 

 

1,997,825

 

(43

)

Total Consumer

 

 

8,504,103

 

 

8,528,407

 

 

 

 

9,070,977

 

(6

)

Total

 

$

43,679,910

 

$

44,353,537

 

(2

)%

 

$

42,571,458

 

3

%

 

 

 

 

 

 

 

 

 

 

 

NON-PERFORMING LOANS COMPOSITION

 

 

 

 

 

 

 

 

(Unaudited)

 

Total

Non-performing Loans

 

Total

Non-performing Loans

 

Linked Quarter

 

Total

Non-performing Loans

 

Year/Year

(Dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

Loan Type

 

September 30, 2023

 

June 30, 2023

 

% Change

 

September 30, 2022

 

% Change

Commercial, Financial, and Agricultural

 

$

97,468

 

$

144,415

 

(33

)%

 

$

59,275

 

64

%

Owner-Occupied

 

 

84,505

 

 

22,197

 

281

 

 

 

8,433

 

902

 

Total Commercial & Industrial

 

 

181,973

 

 

166,612

 

9

 

 

 

67,708

 

169

 

Multi-Family

 

 

1,702

 

 

1,748

 

(3

)

 

 

2,550

 

(33

)

Office Buildings

 

 

27,810

 

 

28,024

 

(1

)

 

 

884

 

nm

Shopping Centers

 

 

653

 

 

699

 

(7

)

 

 

742

 

(12

)

Warehouses

 

 

207

 

 

218

 

(5

)

 

 

223

 

(7

)

Other Investment Property

 

 

572

 

 

664

 

(14

)

 

 

641

 

(11

)

Total Investment Properties

 

 

30,944

 

 

31,353

 

(1

)

 

 

5,040

 

514

 

1-4 Family Construction

 

 

 

 

632

 

nm

 

 

55

 

nm

1-4 Family Investment Mortgage

 

 

3,386

 

 

3,525

 

(4

)

 

 

3,036

 

12

 

Total 1-4 Family Properties

 

 

3,386

 

 

4,157

 

(19

)

 

 

3,091

 

10

 

Commercial Development

 

 

 

 

 

nm

 

 

422

 

(100

)

Residential Development

 

 

267

 

 

267

 

 

 

 

267

 

 

Land Acquisition

 

 

538

 

 

871

 

(38

)

 

 

980

 

(45

)

Land and Development

 

 

805

 

 

1,138

 

(29

)

 

 

1,669

 

(52

)

Total Commercial Real Estate

 

 

35,135

 

 

36,648

 

(4

)

 

 

9,800

 

259

 

Consumer Mortgages

 

 

43,863

 

 

41,877

 

5

 

 

 

32,527

 

35

 

Home Equity

 

 

11,620

 

 

9,936

 

17

 

 

 

7,121

 

63

 

Other Consumer Loans

 

 

7,941

 

 

6,433

 

23

 

 

 

4,938

 

61

 

Total Consumer

 

 

63,424

 

 

58,246

 

9

 

 

 

44,586

 

42

 

Total

 

$

280,532

 

$

261,506

 

7

%

 

$

122,094

 

130

%

 
 
 
 

Synovus

 

 

 

 

 

 

 

 

 

 

 

 

CREDIT QUALITY DATA

 

 

(Unaudited)

 

 

 

 

 

 

 

 

(Dollars in thousands)

2023

 

2022

 

Third Quarter

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Third

 

Second

 

First

 

Fourth

 

Third

 

'23 vs '22

 

 

Quarter

 

Quarter

 

Quarter

 

Quarter

 

Quarter

 

% Change

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-performing Loans (NPLs)

 

$

280,532

 

 

261,506

 

182,460

 

128,061

 

122,094

 

130

%

Impaired Loans Held for Sale

 

 

 

 

 

 

 

447

 

(100

)

Other Real Estate and Other Assets

 

 

 

 

 

 

15,320

 

15,320

 

(100

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-performing Assets (NPAs)

 

 

280,532

 

 

261,506

 

182,460

 

143,381

 

137,861

 

103

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for Loan Losses (ALL)

 

 

477,532

 

 

471,238

 

457,010

 

443,424

 

421,359

 

13

 

Reserve for Unfunded Commitments

 

 

55,185

 

 

55,729

 

57,473

 

57,455

 

57,936

 

(5

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Allowance for Credit Losses (ACL)

 

 

532,717

 

 

526,967

 

514,483

 

500,879

 

479,295

 

11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Charge-Offs - Quarter

 

 

66,822

 

 

26,396

 

18,550

 

13,300

 

4,682

 

 

Net Charge-Offs - YTD

 

 

111,768

 

 

44,946

 

18,550

 

53,156

 

39,856

 

 

Net Charge-Offs / Average Loans - Quarter (1)

 

 

0.61

%

 

0.24

 

0.17

 

0.12

 

0.04

 

 

Net Charge-Offs / Average Loans - YTD (1)

 

 

0.34

 

 

0.20

 

0.17

 

0.13

 

0.13

 

 

NPLs / Loans

 

 

0.64

 

 

0.59

 

0.41

 

0.29

 

0.29

 

 

NPAs / Loans, ORE and specific other assets

 

 

0.64

 

 

0.59

 

0.41

 

0.33

 

0.32

 

 

ACL/Loans

 

 

1.22

 

 

1.19

 

1.17

 

1.15

 

1.13

 

 

ALL/Loans

 

 

1.09

 

 

1.06

 

1.04

 

1.01

 

0.99

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

ACL/NPLs

 

 

189.90

 

 

201.51

 

281.97

 

391.13

 

392.56

 

 

ALL/NPLs

 

 

170.22

 

 

180.20

 

250.47

 

346.26

 

345.11

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Past Due Loans over 90 days and Still Accruing

 

$

3,792

 

 

3,643

 

3,529

 

3,373

 

3,443

 

10

 

As a Percentage of Loans Outstanding

 

 

0.01

%

 

0.01

 

0.01

 

0.01

 

0.01

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total Past Due Loans and Still Accruing

 

$

54,974

 

 

84,946

 

55,053

 

65,568

 

63,545

 

(13

)

As a Percentage of Loans Outstanding

 

 

0.13

%

 

0.19

 

0.12

 

0.15

 

0.15

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Ratio is annualized.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SELECTED CAPITAL INFORMATION (1)

 

 

 

 

 

 

 

 

 

 

 

 

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30,
2023

 

December 31,
2022

 

September 30,
2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Equity Tier 1 Capital Ratio