Glacier Bancorp, Inc. Announces Results for the Quarter Ended March 31, 2015

HIGHLIGHTS:

  • Net income of $27.7 million for the current quarter, an increase of 4 percent from the prior year first quarter net income of $26.7 million.
  • Current quarter diluted earnings per share of $0.37, an increase of 3 percent from the prior year first quarter diluted earnings per share of $0.36.
  • Net interest margin as a percentage of earning assets, on a tax-equivalent basis, for the current quarter was 4.03 percent, an increase of 11 basis points from the prior quarter net interest margin of 3.92 percent.
  • Excluding the acquisition, the loan portfolio increased $115 million, or 10 percent annualized, during the current quarter.
  • Dividend declared of $0.18 per share. The dividend was the 120th consecutive quarterly dividend declared by the Company.
  • Completed the acquisition of Community Bank, Inc., a community bank based in Ronan, Montana.

Results Summary

Three Months ended
(Dollars in thousands, except per share data) Mar 31,
2015
Dec 31,
2014
Mar 31,
2014
Net income $ 27,670 28,054 26,730
Diluted earnings per share $ 0.37 0.37 0.36
Return on average assets (annualized) 1.36% 1.37% 1.39%
Return on average equity (annualized) 10.72% 10.66% 11.04%

KALISPELL, Mont., April 23, 2015 (GLOBE NEWSWIRE) -- Glacier Bancorp, Inc. (Nasdaq:GBCI) reported net income of $27.7 million for the current quarter, an increase of $940 thousand, or 4 percent, from the $26.7 million of net income for the prior year first quarter. Diluted earnings per share for the current quarter was $0.37 per share, an increase of $0.01, or 3 percent, from the prior year first quarter diluted earnings per share of $0.36. Included in the current quarter non-interest expense was $675 thousand of one-time acquisition and conversion related expenses and included in the current quarter was non-interest income of $336 thousand from insurance proceeds on a bank-owned life insurance policy. "It was a nice start to the year on a number of fronts," said Mick Blodnick, President and Chief Executive Officer. "Our growth in organic loans was one of the best we have ever produced in the first quarter of a year. In addition, we were very pleased with the improvement this past quarter to our net interest margin along with much better fee income compared to last year's first quarter. Collectively, they should give us additional earnings strength to carry us through the next three quarters," Blodnick said.

On February 28, 2015, the Company completed the acquisition of Montana Community Banks, Inc. and its subsidiary, Community Bank, Inc. ("CB"). The Company incurred $595 thousand of legal and professional expenses in connection with the CB acquisition during the current quarter. Goodwill of $1.1 million resulted from the acquisition which was based on the estimated fair value of the assets acquired and liabilities assumed. "It was exciting to close the Montana Community Banks, Inc. transaction this quarter," Blodnick said. "We can't thank the Olsson family and the entire staff enough for their cooperation throughout the process and believe this will be another excellent addition to our Company," Blodnick said.

The Company's results of operations and financial condition include the acquisition of CB from the acquisition date and the following table provides information on the fair value of selected classifications of assets and liabilities acquired:

(Dollars in thousands) February 28,
2015
Total assets $ 175,774
Investment securities 42,350
Loans receivable 84,689
Non-interest bearing deposits 41,779
Interest bearing deposits 105,041
Federal Home Loan Bank advances and other borrowed funds 3,292

Asset Summary

$ Change from
(Dollars in thousands) Mar 31,
2015
Dec 31,
2014
Mar 31,
2014
Dec 31,
2014
Mar 31,
2014
Cash and cash equivalents $ 183,466 442,409 161,691 (258,943) 21,775
Investment securities, available-for-sale 2,544,093 2,387,428 2,669,180 156,665 (125,087)
Investment securities, held-to-maturity 570,285 520,997 481,476 49,288 88,809
Total investment securities 3,114,378 2,908,425 3,150,656 205,953 (36,278)
Loans receivable
Residential real estate 637,465 611,463 580,306 26,002 57,159
Commercial 3,426,016 3,263,448 2,928,995 162,568 497,021
Consumer and other 624,188 613,184 579,328 11,004 44,860
Loans receivable 4,687,669 4,488,095 4,088,629 199,574 599,040
Allowance for loan and lease losses (129,856) (129,753) (130,729) (103) 873
Loans receivable, net 4,557,813 4,358,342 3,957,900 199,471 599,913
Other assets 619,439 597,331 560,476 22,108 58,963
Total assets $ 8,475,096 8,306,507 7,830,723 168,589 644,373

Total investment securities increased $206 million, or 7 percent, during the current quarter and decreased $36 million, or 1 percent, from March 31, 2014. The increase in the investment portfolio during the current quarter was the result of the Company redeploying excess liquidity into higher yielding investment securities. Investment securities represented 37 percent of total assets at March 31, 2015 compared to 35 percent at December 31, 2014 and 40 percent at March 31, 2014.

Excluding the loans receivable from the acquisition of CB, the loan portfolio increased by $115 million, or 10 percent annualized, during the current quarter with improvement in all loan categories including a $96.8 million increase in commercial loans. Excluding the CB acquisition and the First National Bank of the Rockies ("FNBR") acquisition in August 2014, the loan portfolio increased $377 million, or 9 percent, since March 31, 2014 with increases in all loan categories of which $314 million of the increase came from growth in commercial loans. "With the start we've given ourselves, achieving our goal of six percent loan growth this year is now certainly within reason," Blodnick said. "We knew we carried some good loan momentum into 2015; nevertheless, we were thrilled with this level of loan growth considering it's historically our weakest quarter," Blodnick said.

Credit Quality Summary

(Dollars in thousands) At or for the
Three Months
ended
March 31,
2015
At or for the
Year ended
December 31,
2014
At or for the
Three Months
ended
March 31,
2014
Allowance for loan and lease losses
Balance at beginning of period $ 129,753 130,351 130,351
Provision for loan losses 765 1,912 1,122
Charge-offs (1,297) (7,603) (1,586)
Recoveries 635 5,093 842
Balance at end of period $ 129,856 129,753 130,729
Other real estate owned $ 28,124 27,804 27,332
Accruing loans 90 days or more past due 2,357 214 569
Non-accrual loans 60,287 61,882 78,905
Total non-performing assets 1 $ 90,768 89,900 106,806
Non-performing assets as a percentage of subsidiary assets 1.07% 1.08% 1.37%
Allowance for loan and lease losses as a percentage of non-performing loans 207% 209% 164%
Allowance for loan and lease losses as a percentage of total loans 2.77% 2.89% 3.20%
Net charge-offs as a percentage of total loans 0.01% 0.06% 0.02%
Accruing loans 30-89 days past due $ 33,450 25,904 42,862
Accruing troubled debt restructurings $ 69,397 69,129 77,311
Non-accrual troubled debt restructurings $ 34,237 33,714 37,113
__________
1 As of March 31, 2015, non-performing assets have not been reduced by U.S. government guarantees of $4.1 million.

Non-performing assets at March 31, 2015 were $90.8 million, an increase of $868 thousand, or less than 1 percent, during the current quarter which was the result of the CB acquisition. Non-performing assets at March 31, 2015 decreased $16.0 million, or 15 percent, from a year ago. Land, lot and other construction loans (i.e., regulatory classification) continues to be the largest category and was $45.6 million, or 50 percent, of the non-performing assets at March 31, 2015. The Company has continued to make progress by reducing this category the past few years and the category decreased $2.1 million, or 4 percent, from the prior quarter. Early stage delinquencies (accruing loans 30-89 days past due) of $33.5 million at March 31, 2015 increased $7.5 million from the prior quarter and decreased $9.4 million from the prior year first quarter.

The allowance for loan and lease losses ("allowance") was $130 million at March 31, 2015 and continued to remain stable compared to the prior periods. The allowance was 2.77 percent of total loans outstanding at March 31, 2015 compared to 2.89 percent at December 31, 2014 and 3.20 percent for the same quarter last year. The reduction in the allowance as a percentage of total loans was driven primarily by loan growth, stabilizing credit quality, and no allowance carried over from bank acquisitions as a result of the acquired loans recorded at fair value.

Credit Quality Trends and Provision for Loan Losses

(Dollars in thousands) Provision
for Loan
Losses
Net
Charge-Offs
ALLL
as a Percent
of Loans
Accruing
Loans 30-89
Days Past Due
as a Percent of
Loans
Non-Performing
Assets to
Total Subsidiary
Assets
First quarter 2015 $ 765 $ 662 2.77% 0.71% 1.07%
Fourth quarter 2014 191 1,070 2.89% 0.58% 1.08%
Third quarter 2014 360 364 2.93% 0.39% 1.21%
Second quarter 2014 239 332 3.11% 0.44% 1.30%
First quarter 2014 1,122 744 3.20% 1.05% 1.37%
Fourth quarter 2013 1,802 2,216 3.21% 0.79% 1.39%
Third quarter 2013 1,907 2,025 3.27% 0.66% 1.56%
Second quarter 2013 1,078 1,030 3.56% 0.60% 1.64%

Net charged-off loans for the current quarter were $662 thousand, a decrease of $408 thousand from the prior quarter and a decrease of $82 thousand from the prior year first quarter. The current quarter provision for loan losses of $765 thousand increased $574 thousand from the prior quarter and decreased $357 thousand from the prior year first quarter. Loan portfolio growth, composition, average loan size, credit quality considerations, and other environmental factors will continue to determine the level of provision for loan loss expense.

Supplemental information regarding credit quality and identification of the Company's loan portfolio based on regulatory classification is provided in the exhibits at the end of this press release. The regulatory classification of loans is based primarily on collateral type while the Company's loan segments presented herein are based on the purpose of the loan.

Liability Summary

$ Change from
(Dollars in thousands) Mar 31,
2015
Dec 31,
2014
Mar 31,
2014
Dec 31,
2014
Mar 31,
2014
Non-interest bearing deposits $ 1,675,451 1,632,403 1,396,272 43,048 279,179
Interest bearing deposits 4,783,341 4,712,809 4,228,193 70,532 555,148
Repurchase agreements 425,652 397,107 327,322 28,545 98,330
Federal Home Loan Bank advances 298,148 296,944 686,744 1,204 (388,596)
Other borrowed funds 6,703 7,311 8,069 (608) (1,366)
Subordinated debentures 125,741 125,705 125,597 36 144
Other liabilities 106,536 106,181 73,566 355 32,970
Total liabilities $ 7,421,572 7,278,460 6,845,763 143,112 575,809

Excluding the acquisition of CB, non-interest bearing deposits at March 31, 2015 increased $1.3 million, or less than 1 percent, during the current quarter. Excluding the CB and FNBR acquisitions, non-interest bearing deposits increased $157 million, or 11 percent, from March 31, 2014. Interest bearing deposits of $4.783 billion at March 31, 2015 included $211 million of wholesale deposits (i.e., brokered deposits classified as NOW, money market deposits and certificate accounts). Excluding the CB acquisition and the decrease of $37.8 million in wholesale deposits, interest bearing deposits at March 31, 2015 increased $3.3 million, or less than 1 percent, during the current quarter. Excluding the CB and FNBR acquisitions and an increase of $32.9 million in wholesale deposits, interest bearing deposits at March 31, 2015 increased $188 million, or 5 percent, from a year ago. Federal Home Loan Bank ("FHLB") advances of $298 million at March 31, 2015 increased $1.2 million, or less than 1 percent, during the current quarter and decreased $389 million, or 57 percent, from March 31, 2014 as growth in deposits and continued balance sheet restructuring reduce the need for additional borrowings.

Stockholders' Equity Summary

$ Change from
(Dollars in thousands, except per share data) Mar 31,
2015
Dec 31,
2014
Mar 31,
2014
Dec 31,
2014
Mar 31,
2014
Common equity $ 1,035,497 1,010,303 969,672 25,194 65,825
Accumulated other comprehensive income 18,027 17,744 15,288 283 2,739
Total stockholders' equity 1,053,524 1,028,047 984,960 25,477 68,564
Goodwill and core deposit intangible, net (143,099) (140,606) (138,508) (2,493) (4,591)
Tangible stockholders' equity $ 910,425 887,441 846,452 22,984 63,973
Stockholders' equity to total assets 12.43% 12.38% 12.58%
Tangible stockholders' equity to total tangible assets 10.93% 10.87% 11.00%
Book value per common share $ 13.95 13.70 13.23 0.25 0.72
Tangible book value per common share $ 12.05 11.83 11.37 0.22 0.68
Market price per share at end of period $ 25.15 27.77 29.07 (2.62) (3.92)

Tangible stockholders' equity of $910 million at March 31, 2015 increased $23.0 million, or 3 percent, from the prior quarter which was primarily the result of $10.8 million of Company stock issued in connection with the CB acquisition and earnings retention. Tangible stockholders' equity increased $64.0 million from a year ago as the result of earnings retention, Company stock issued in connection with the CB and FNBR acquisitions, and an increase in accumulated other comprehensive income. Tangible book value per common share of $12.05 increased $0.22 per share from the prior quarter and increased $0.68 per share from the prior year first quarter.

Cash Dividend

On March 25, 2015, the Company's Board of Directors declared a cash dividend of $0.18 per share during the current quarter. The dividend was payable April 16, 2015 to shareholders of record on April 7, 2015. Future cash dividends will depend on a variety of factors, including net income, capital, asset quality, general economic conditions and regulatory considerations.

Operating Results for Three Months Ended March 31, 2015
Compared to December 31, 2014 and March 31, 2014
Revenue Summary
Three Months ended $ Change from
(Dollars in thousands) Mar 31,
2015
Dec 31,
2014
Mar 31,
2014
Dec 31,
2014
Mar 31,
2014
Net interest income
Interest income $ 77,486 76,179 74,087 1,307 3,399
Interest expense 7,382 7,368 6,640 14 742
Total net interest income 70,104 68,811 67,447 1,293 2,657
Non-interest income
Service charges, loan fees, and other fees 14,156 15,129 13,248 (973) 908
Gain on sale of loans 5,430 5,424 3,595 6 1,835
Gain (loss) on sale of investments 5 (28) (51) 33 56
Other income 3,102 3,453 2,596 (351) 506
Total non-interest income 22,693 23,978 19,388 (1,285) 3,305
$ 92,797 92,789 86,835 8 5,962
Net interest margin (tax-equivalent) 4.03% 3.92% 4.02%

Net Interest Income

The current quarter interest income of $77.5 million increased $1.3 million, or 2 percent, from the prior quarter. The current quarter increase in interest income was primarily driven by increases in interest income on commercial loans and interest income from the investment securities portfolio. The current quarter interest income on commercial loans increased $1.1 million, or 3 percent, from the prior quarter and the current quarter interest income on investment securities increased $909 thousand, or 4 percent, from the prior quarter. The current quarter's interest income increased $3.4 million, or 5 percent, over the prior year first quarter and was primarily attributable to higher interest income on commercial loans, which offset the decrease in interest income on investment securities. The current quarter interest income of $39.0 million on commercial loans increased $4.0 million, or 11 percent, over the prior year first quarter primarily the result of an increase in volume in commercial loans. Current quarter interest income of $23.0 million on investment securities decreased $1.4 million, or 6 percent, over the prior year first quarter as a result of a decrease in volume in investment securities.

The current quarter interest expense of $7.4 million increased $14 thousand, or less than 1 percent, from the prior quarter. The current quarter interest expense increased $742 thousand from the prior year first quarter, such increase attributed to the interest expense associated with the interest rate swap which started interest expense accruals in the fourth quarter of 2014. The total cost of funding (including non-interest bearing deposits) for the current quarter and prior quarter was 42 basis points compared to 40 basis points in the prior year first quarter.

The Company's net interest margin as a percentage of earning assets, on a tax-equivalent basis, for the current quarter was 4.03 percent compared to 3.92 percent in the prior quarter. The 11 basis points increase in the current quarter net interest margin was primarily driven by the 12 basis points increase in the yield on loans. The Company's current quarter net interest margin increased 1 basis point from the prior year first quarter net interest margin of 4.02 percent. "The Bank divisions have done an excellent job in pricing loans where possible at higher yields in the first quarter," said Ron Copher, Chief Financial Officer. "The first quarter's higher yielding loans along with the increased loan volume provide a foundation for higher net interest income throughout the year," Copher said.

Non-interest Income

Non-interest income for the current quarter totaled $22.7 million, a decrease of $1.3 million over the prior quarter and an increase of $3.3 million over the same quarter last year. Service fee income of $13.0 million, decreased $1.0 million, or 7 percent, from the prior quarter as a result of seasonal activity and increased $780 thousand, or 6 percent, from the prior year first quarter as a result of the increased number of deposit accounts. Gain of $5.4 million on the sale of the residential loans in the current quarter increased $1.8 million, or 51 percent, from the prior year first quarter as a result of an increase in mortgage refinancing activity. Other non-interest income for the current quarter of $3.1 million, decreased $351 thousand, or 10 percent, over the prior quarter due to a decrease of $411 thousand of insurance proceeds recognized from bank-owned life insurance policies. Other non-interest income for the current quarter increased $506 thousand, or 19 percent, over the prior year first quarter and was primarily attributable to $336 thousand of insurance proceeds recognized from a bank-owned life insurance policy during the current quarter. Included in other income was operating revenue of $71 thousand from other real estate owned ("OREO") and gain of $346 thousand from the sale of OREO, a combined total of $417 thousand for the current quarter compared to $441 thousand for the prior quarter and $811 thousand for the prior year first quarter.

Non-interest Expense Summary

Three Months ended $ Change from
(Dollars in thousands) Mar 31,
2015
Dec 31,
2014
Mar 31,
2014
Dec 31,
2014
Mar 31,
2014
Compensation and employee benefits $ 32,244 30,807 28,634 1,437 3,610
Occupancy and equipment 7,362 7,191 6,613 171 749
Advertising and promotions 1,927 2,046 1,777 (119) 150
Data processing 1,249 1,815 1,288 (566) (39)
Other real estate owned 758 893 507 (135) 251
Regulatory assessments and insurance 1,305 1,009 1,592 296 (287)
Core deposit intangibles amortization 731 716 710 15 21
Other expenses 9,921 11,221 8,949 (1,300) 972
Total non-interest expense $ 55,497 55,698 50,070 (201) 5,427

Compensation and employee benefits for the current quarter increased by $1.4 million, or 5 percent, from the prior quarter due to the increased number of employees from the CB acquisition and increased benefit expenses. Compensation and employee benefits for the current quarter increased by $3.6 million from the prior year first quarter also due to the increased number of employees from the CB and FNBR acquisitions, along with additional benefit costs and salary increases. Current quarter occupancy and equipment expense increased $749 thousand, or 11 percent, from the prior year first quarter as a result of added costs associated with the CB and FNBR acquisitions. The current quarter data processing expense decreased $566 thousand, or 31 percent, from the prior quarter as a result of conversion related expenses in the fourth quarter of 2014. The current quarter OREO expense of $758 thousand included $414 thousand of operating expense, $224 thousand of fair value write-downs, and $120 thousand of loss on sale of OREO. Current quarter other expenses of $9.9 million decreased by $1.3 million, or 12 percent, from the prior quarter primarily from decreases in acquisition and conversion related expenses and decreases in expenses connected with New Markets Tax Credits. Current quarter other expense increased $972 thousand, or 11 percent, from the prior year first quarter due to increases in acquisition-related expenses.

Efficiency Ratio

The efficiency ratio for the current quarter was 54.8 percent and the prior year first quarter was 53.47 percent. The 1.33 percent increase in efficiency ratio resulted from increases in non-interest expense primarily the result of increased compensation and other operational expenses, which exceeded the increases in net interest income from higher yielding earning assets and increases in non-interest income from greater mortgage refinancing activity.

About Glacier Bancorp, Inc.

Glacier Bancorp, Inc. is a regional bank holding company providing commercial banking services in 82 communities in Montana, Idaho, Utah, Washington, Wyoming and Colorado. Glacier Bancorp, Inc. is headquartered in Kalispell, Montana, and is the parent company for Glacier Bank, Kalispell and Bank divisions First Security Bank of Missoula; Valley Bank of Helena; Big Sky Western Bank, Bozeman; Western Security Bank, Billings; and First Bank of Montana, Lewistown, all operating in Montana; as well as Mountain West Bank, Coeur d'Alene operating in Idaho, Utah and Washington; Citizens Community Bank, Pocatello, operating in Idaho; 1st Bank, Evanston, operating in Wyoming and Utah; First Bank of Wyoming, Powell and First State Bank, Wheatland, each operating in Wyoming; North Cascades Bank, Chelan, operating in Washington; and Bank of the San Juans, Durango, operating in Colorado.

Forward-Looking Statements

This news release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, statements about management's plans, objectives, expectations and intentions that are not historical facts, and other statements identified by words such as "expects," "anticipates," "intends," "plans," "believes," "should," "projects," "seeks," "estimates" or words of similar meaning. These forward-looking statements are based on current beliefs and expectations of management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the Company's control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations in the forward-looking statements, including those set forth in this news release:

  • the risks associated with lending and potential adverse changes of the credit quality of loans in the Company's portfolio;
  • the risks presented by the lingering economic recovery which could adversely affect credit quality, loan collateral values, OREO values, investment values, liquidity and capital levels, dividends and loan originations;
  • changes in market interest rates, which could adversely affect the Company's net interest income and profitability;
  • legislative or regulatory changes that adversely affect the Company's business, ability to complete pending or prospective future acquisitions, limit certain sources of revenue, or increase cost of operations;
  • costs or difficulties related to the completion and integration of acquisitions;
  • the goodwill the Company has recorded in connection with acquisitions could become additionally impaired, which may have an adverse impact on earnings and capital;
  • reduced demand for banking products and services;
  • the risks presented by public stock market volatility, which could adversely affect the market price of the Company's common stock and the ability to raise additional capital or grow the Company through acquisitions;
  • consolidation in the financial services industry in the Company's markets resulting in the creation of larger financial institutions who may have greater resources could change the competitive landscape;
  • dependence on the Chief Executive Officer, the senior management team and the Presidents of the Bank divisions;
  • potential interruption or breach in security of the Company's systems; and
  • the Company's success in managing risks involved in the foregoing.

The Company does not undertake any obligation to publicly correct or update any forward-looking statement if it later becomes aware that actual results are likely to differ materially from those expressed in such forward-looking statement.

Glacier Bancorp, Inc.
Unaudited Condensed Consolidated Statements of Financial Condition
(Dollars in thousands, except per share data) March 31,
2015
December 31,
2014
March 31,
2014
Assets
Cash on hand and in banks $ 109,746 122,834 116,267
Federal funds sold 1,025 14,055
Interest bearing cash deposits 73,720 318,550 31,369
Cash and cash equivalents 183,466 442,409 161,691
Investment securities, available-for-sale 2,544,093 2,387,428 2,669,180
Investment securities, held-to-maturity 570,285 520,997 481,476
Total investment securities 3,114,378 2,908,425 3,150,656
Loans held for sale 54,132 46,726 36,133
Loans receivable 4,687,669 4,488,095 4,088,629
Allowance for loan and lease losses (129,856) (129,753) (130,729)
Loans receivable, net 4,557,813 4,358,342 3,957,900
Premises and equipment, net 187,067 179,175 166,757
Other real estate owned 28,124 27,804 27,332
Accrued interest receivable 43,260 40,587 41,274
Deferred tax asset 41,220 41,737 39,997
Core deposit intangible, net 12,256 10,900 8,802
Goodwill 130,843 129,706 129,706
Non-marketable equity securities 54,277 52,868 52,192
Other assets 68,260 67,828 58,283
Total assets $ 8,475,096 8,306,507 7,830,723
Liabilities
Non-interest bearing deposits $ 1,675,451 1,632,403 1,396,272
Interest bearing deposits 4,783,341 4,712,809 4,228,193
Securities sold under agreements to repurchase 425,652 397,107 327,322
FHLB advances 298,148 296,944 686,744
Other borrowed funds 6,703 7,311 8,069
Subordinated debentures 125,741 125,705 125,597
Accrued interest payable 3,893 4,155 3,173
Other liabilities 102,643 102,026 70,393
Total liabilities 7,421,572 7,278,460 6,845,763
Stockholders' Equity
Preferred shares, $0.01 par value per share, 1,000,000 shares authorized, none issued or outstanding
Common stock, $0.01 par value per share, 117,187,500 shares authorized 755 750 745
Paid-in capital 719,506 708,356 692,196
Retained earnings - substantially restricted 315,236 301,197 276,731
Accumulated other comprehensive income 18,027 17,744 15,288
Total stockholders' equity 1,053,524 1,028,047 984,960
Total liabilities and stockholders' equity $ 8,475,096 8,306,507 7,830,723
Number of common stock shares issued and outstanding 75,530,030 75,026,092 74,465,666
Glacier Bancorp, Inc.
Unaudited Condensed Consolidated Statements of Operations
Three Months ended
(Dollars in thousands, except per share data) March 31,
2015
December 31,
2014
March 31,
2014
Interest Income
Residential real estate loans $ 7,761 8,464 7,087
Commercial loans 39,022 37,935 35,042
Consumer and other loans 7,744 7,730 7,643
Investment securities 22,959 22,050 24,315
Total interest income 77,486 76,179 74,087
Interest Expense
Deposits 4,147 4,018 3,089
Securities sold under agreements to repurchase 241 238 210
Federal Home Loan Bank advances 2,195 2,253 2,514
Federal funds purchased and other borrowed funds 27 64 53
Subordinated debentures 772 795 774
Total interest expense 7,382 7,368 6,640
Net Interest Income 70,104 68,811 67,447
Provision for loan losses 765 191 1,122
Net interest income after provision for loan losses 69,339 68,620 66,325
Non-Interest Income
Service charges and other fees 12,999 14,004 12,219
Miscellaneous loan fees and charges 1,157 1,125 1,029
Gain on sale of loans 5,430 5,424 3,595
Gain (loss) on sale of investments 5 (28) (51)
Other income 3,102 3,453 2,596
Total non-interest income 22,693 23,978 19,388
Non-Interest Expense
Compensation and employee benefits 32,244 30,807 28,634
Occupancy and equipment 7,362 7,191 6,613
Advertising and promotions 1,927 2,046 1,777
Data processing 1,249 1,815 1,288
Other real estate owned 758 893 507
Regulatory assessments and insurance 1,305 1,009 1,592
Core deposit intangibles amortization 731 716 710
Other expenses 9,921 11,221 8,949
Total non-interest expense 55,497 55,698 50,070
Income Before Income Taxes 36,535 36,900 35,643
Federal and state income tax expense 8,865 8,846 8,913
Net Income $ 27,670 28,054 26,730
Basic earnings per share $ 0.37 0.37 0.36
Diluted earnings per share $ 0.37 0.37 0.36
Dividends declared per share $ 0.18 0.48 0.16
Average outstanding shares - basic 75,206,348 75,025,201 74,437,393
Average outstanding shares - diluted 75,244,959 75,082,566 74,480,818
Glacier Bancorp, Inc.
Average Balance Sheet
Three Months ended
March 31, 2015
Three Months ended
March 31, 2014
(Dollars in thousands) Average
Balance
Interest &
Dividends
Average
Yield/
Rate
Average
Balance
Interest &
Dividends
Average
Yield/
Rate
Assets
Residential real estate loans $ 651,700 $ 7,761 4.76% $ 609,534 $ 7,087 4.65%
Commercial loans 1 3,282,867 39,605 4.89% 2,882,054 35,042 4.93%
Consumer and other loans 609,853 7,744 5.15% 576,625 7,643 5.38%
Total loans 2 4,544,420 55,110 4.92% 4,068,213 49,772 4.96%
Tax-exempt investment securities 3 1,302,174 18,493 5.68% 1,191,679 16,768 5.63%
Taxable investment securities 4 1,904,835 10,754 2.26% 2,101,464 13,064 2.49%
Total earning assets 7,751,429 84,357 4.41% 7,361,356 79,604 4.39%
Goodwill and intangibles 140,726 138,901
Non-earning assets 379,581 317,625
Total assets $ 8,271,736 $ 7,817,882
Liabilities
Non-interest bearing deposits $ 1,618,132 $ — —% $ 1,329,736 $ — —%
NOW accounts 1,311,330 268 0.08% 1,097,430 334 0.12%
Savings accounts 713,897 89 0.05% 628,947 80 0.05%
Money market deposit accounts 1,304,006 517 0.16% 1,187,525 600 0.20%
Certificate accounts 1,165,483 1,843 0.64% 1,132,828 1,984 0.71%
Wholesale deposits 5 220,382 1,430 2.63% 148,417 91 0.25%
FHLB advances 299,975 2,195 2.93% 825,823 2,514 1.22%
Repurchase agreements, federal funds purchased and other borrowed funds 503,816 1,040 0.84% 439,700 1,037 0.96%
Total funding liabilities 7,137,021 7,382 0.42% 6,790,406 6,640 0.40%
Other liabilities 88,143 45,787
Total liabilities 7,225,164 6,836,193
Stockholders' Equity
Common stock 752 744
Paid-in capital 712,127 691,626
Retained earnings 314,004 274,865
Accumulated other comprehensive income 19,689 14,454
Total stockholders' equity 1,046,572 981,689
Total liabilities and stockholders' equity $ 8,271,736 $ 7,817,882
Net interest income (tax-equivalent) $ 76,975 $ 72,964
Net interest spread (tax-equivalent) 3.99% 3.99%
Net interest margin (tax-equivalent) 4.03% 4.02%
__________
1 Includes tax effect of $583 thousand on tax-exempt municipal loan and lease income for the three months ended March 31, 2015. The tax effect for the three months ended March 31, 2014 was not significant.
2 Total loans are gross of the allowance for loan and lease losses, net of unearned income and include loans held for sale. Non-accrual loans were included in the average volume for the entire period.
3 Includes tax effect of $5.9 million and $5.1 million on tax-exempt investment security income for the three months ended March 31, 2015 and 2014, respectively.
4 Includes tax effect of $362 thousand and $372 thousand on federal income tax credits for the three months ended March 31, 2015 and 2014, respectively.
5 Wholesale deposits include brokered deposits classified as NOW, money market deposit and certificate accounts.
Glacier Bancorp, Inc.
Loan Portfolio by Regulatory Classification
Loans Receivable, by Loan Type % Change from
(Dollars in thousands) Mar 31,
2015
Dec 31,
2014
Mar 31,
2014
Dec 31,
2014
Mar 31,
2014
Custom and owner occupied construction $ 51,693 $ 56,689 $ 44,333 (9)% 17 %
Pre-sold and spec construction 44,865 47,406 34,786 (5)% 29 %
Total residential construction 96,558 104,095 79,119 (7)% 22 %
Land development 81,488 82,829 82,275 (2)% (1)%
Consumer land or lots 97,519 101,818 104,308 (4)% (7)%
Unimproved land 80,206 86,116 49,871 (7)% 61 %
Developed lots for operative builders 14,210 14,126 15,984 1 % (11)%
Commercial lots 21,059 16,205 15,609 30 % 35 %
Other construction 148,535 150,075 84,214 (1)% 76 %
Total land, lot, and other construction 443,017 451,169 352,261 (2)% 26 %
Owner occupied 877,293 849,148 812,727 3 % 8 %
Non-owner occupied 704,990 674,381 611,093 5 % 15 %
Total commercial real estate 1,582,283 1,523,529 1,423,820 4 % 11 %
Commercial and industrial 585,501 547,910 523,071 7 % 12 %
Agriculture 340,364 310,785 269,886 10 % 26 %
1st lien 796,947 775,785 726,471 3 % 10 %
Junior lien 67,217 68,358 71,012 (2)% (5)%
Total 1-4 family 864,164 844,143 797,483 2 % 8 %
Multifamily residential 177,187 160,426 143,438 10 % 24 %
Home equity lines of credit 347,693 334,788 298,073 4 % 17 %
Other consumer 141,347 133,773 131,030 6 % 8 %
Total consumer 489,040 468,561 429,103 4 % 14 %
Other 163,687 124,203 106,581 32 % 54 %
Total loans receivable, including loans held for sale 4,741,801 4,534,821 4,124,762 5 % 15 %
Less loans held for sale 1 (54,132) (46,726) (36,133) 16 % 50 %
Total loans receivable $ 4,687,669 $ 4,488,095 $ 4,088,629 4 % 15 %
_______
1 Loans held for sale are primarily 1st lien 1-4 family loans.
Glacier Bancorp, Inc.
Credit Quality Summary by Regulatory Classification
Non-performing Assets, by Loan Type Non-
Accrual
Loans
Accruing
Loans 90
Days or
More Past
Due
Other
Real Estate
Owned
(Dollars in thousands) Mar 31,
2015
Dec 31,
2014
Mar 31,
2014
Mar 31,
2015
Mar 31,
2015
Mar 31,
2015
Custom and owner occupied construction $ 1,101 1,132 1,227 1,101
Pre-sold and spec construction 218 218 663 218
Total residential construction 1,319 1,350 1,890 1,319
Land development 21,220 20,842 24,555 11,250 9,970
Consumer land or lots 2,531 3,581 3,169 1,111 47 1,373
Unimproved land 13,448 14,170 12,965 10,826 2,622
Developed lots for operative builders 929 1,318 2,157 718 211
Commercial lots 2,496 2,660 2,842 249 2,247
Other construction 4,989 5,151 5,168 4,989
Total land, lot and other construction 45,613 47,722 50,856 24,154 47 21,412
Owner occupied 13,121 13,574 14,625 10,946 2,175
Non-owner occupied 3,771 3,013 3,563 1,649 2,122
Total commercial real estate 16,892 16,587 18,188 12,595 4,297
Commercial and industrial 6,367 4,375 5,030 6,270 50 47
Agriculture 2,845 3,074 3,484 2,397 448
1st lien 9,502 9,580 17,457 8,038 216 1,248
Junior lien 680 442 4,947 469 211
Total 1-4 family 10,182 10,022 22,404 8,507 427 1,248
Multifamily residential 440 156
Home equity lines of credit 5,507 6,099 4,434 4,864 643
Other consumer 243 231 364 181 33 29
Total consumer 5,750 6,330 4,798 5,045 33 672
Other 1,800 1,800
Total $ 90,768 89,900 106,806 60,287 2,357 28,124
Glacier Bancorp, Inc.
Credit Quality Summary by Regulatory Classification (continued)
Accruing 30-89 Days Delinquent Loans,
by Loan Type
% Change from
(Dollars in thousands) Mar 31,
2015
Dec 31,
2014
Mar 31,
2014
Dec 31,
2014
Mar 31,
2014
Custom and owner occupied construction $ — $ — $ 277 n/m (100)%
Pre-sold and spec construction 869 101 (100)% (100)%
Total residential construction 869 378 (100)% (100)%
Consumer land or lots 365 391 504 (7)% (28)%
Unimproved land 278 267 420 4 % (34)%
Developed lots for operative builders 19 1,163 n/m (98)%
Commercial lots 585 21 2,686 % n/m
Total land, lot and other construction 1,247 679 2,087 84 % (40)%
Owner occupied 4,841 5,971 9,099 (19)% (47)%
Non-owner occupied 4,327 3,131 2,901 38 % 49 %
Total commercial real estate 9,168 9,102 12,000 1 % (24)%
Commercial and industrial 6,600 2,915 6,192 126 % 7 %
Agriculture 3,715 994 2,710 274 % 37 %
1st lien 7,307 6,804 15,018 7 % (51)%
Junior lien 384 491 503 (22)% (24)%
Total 1-4 family 7,691 7,295 15,521 5 % (50)%
Multifamily Residential 676 1,535 n/m (56)%
Home equity lines of credit 3,350 1,288 1,506 160 % 122 %
Other consumer 1,003 928 933 8 % 8 %
Total consumer 4,353 2,216 2,439 96 % 78 %
Other 1,834 (100)% n/m
Total $ 33,450 $ 25,904 $ 42,862 29 % (22)%
_______
n/m - not measurable
Glacier Bancorp, Inc.
Credit Quality Summary by Regulatory Classification (continued)
Net Charge-Offs (Recoveries), Year-to-Date
Period Ending, By Loan Type
Charge-Offs Recoveries
(Dollars in thousands) Mar 31,
2015
Dec 31,
2014
Mar 31,
2014
Mar 31,
2015
Mar 31,
2015
Pre-sold and spec construction $ (9) (94) (16) 9
Land development (23) (390) 93 11 34
Consumer land or lots (15) 375 (69) 24 39
Unimproved land (50) 52 (5) 50
Developed lots for operative builders (96) (140) (17) 96
Commercial lots (1) (6) (2) 1
Other construction (1) 1
Total land, lot and other construction (186) (109) 35 221
Owner occupied 316 669 (18) 347 31
Non-owner occupied 82 (162) (185) 88 6
Total commercial real estate 398 507 (203) 435 37
Commercial and industrial 426 1069 1038 589 163
Agriculture (4) 28 4
1st lien (30) 372 (199) 16 46
Junior lien (54) 183 38 54
Total 1-4 family (84) 555 (161) 16 100
Multifamily residential (20) 138 1 20
Home equity lines of credit 121 190 51 133 12
Other consumer 20 226 34 89 69
Total consumer 141 416 85 222 81
Total $ 662 2,510 744 1,297 635

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CONTACT: Michael J. Blodnick (406) 751-4701 Ron J. Copher (406) 751-7706Source:Glacier Bancorp, Inc.