Columbia Banking System Announces First Quarter 2012 Earnings

TACOMA, Wash., April 25, 2012 /PRNewswire/ -- Columbia Banking System, Inc. (NASDAQ: COLB) ("Columbia") today announced net income of $8.9 million for the quarter ended March 31, 2012, an increase of 54% compared to net income of $5.8 million for the same quarter of 2011.  Earnings per diluted common share rose 47% to $0.22 for the first quarter, compared with earnings of $0.15 per diluted common share a year earlier.

Loans not covered under the FDIC loss-sharing agreements ('noncovered loans") increased approximately $23 million during the quarter to $2.37 billion.  Total deposits increased $49.9 million to $3.87 billion.  Deposits increased in every category except certificates of deposit.

Melanie Dressel, President and Chief Executive Officer commented, "During the quarter, we continued to generate momentum as a result of our external focus on new and existing customers throughout our entire system.  From year-end 2011, our commercial business loans grew 4.6% and our impressive core deposits rose over 2%, now representing 93% of our total deposits."

Ms. Dressel continued, "As compared to fourth quarter, 2011, our first quarter results reflected expenses and write-downs associated with other real estate owned and other personal property owned.  Also impacting the quarter was lower accretion income from the Bank of Whitman discounted loan portfolio as these loans continue to pay off or refinance." 

Significant Influences on the Quarter Ended March 31, 2012       

Other Real Estate Owned and Other Personal Property Owned

Other real estate owned ("OREO") declined from $51.0 million at December 31, 2011 to $41.2 million at March 31, 2012.  The decline is due to property sales and write-downs of certain assets.  As a result of the asset write-downs and other operating expenses, the net cost of operation for noncovered OREO was $2.7 million for the first quarter as compared to $923,000 for the fourth quarter 2011.  These expenses were partially offset by the net benefit from covered OREO of $1.8 million for the first quarter 2012 as compared to $1.5 million for the fourth quarter 2011.

During the first quarter, other personal property owned ("OPPO"), declined from $9.0 million at December 31, 2011 to $4.8 million at March 31, 2012. Noncovered OPPO expense was $2.2 million for the first quarter as compared to $22,000 for the fourth quarter 2011. Substantially all of the expense recorded in the first quarter was the result of a write-down on one property due to an updated appraisal.

Andy McDonald, Executive Vice President and Chief Credit Officer commented, "We continued to see a positive trend during the quarter as we work to resolve issues surrounding our nonperforming assets.  As we move through this credit cycle, our provision for loan losses is more closely approximating our charge-offs, in line with our expectations.  While we were disappointed with the write-down on OPPO, it was isolated to a single asset, and was not indicative of any systemic issues within our loan, OREO or OPPO portfolios."

Impact of Acquired Loan Accounting

The following table illustrates the significant impact to earnings associated with certain of Columbia's acquired loan portfolios:

Acquired Loan Portfolio Activity







Three Months Ended



March 31, 2012


March 31, 2011



(in thousands)


Incremental accretion income on acquired impaired loans

$

19,320



$

12,371



Incremental accretion income on other acquired loans

3,101





(Provision) recapture for losses on covered loans

(15,685)



422



Change in FDIC loss sharing asset

(1,668)



(14,774)



Claw back liability expense (benefit)

26



(1,700)



Pre-tax earnings impact

$

5,094



$

(3,681)
















The incremental accretion income in the table above represents the amount of income recorded on certain acquired loans above the contractual rate stated in the individual loan notes and stems from the discount established at the time these loan portfolios were acquired.  As of March 31, 2012, the remaining discount from the Bank of Whitman transaction was $8.2 million.  It is anticipated that this discount will continue to accrete to earnings throughout 2012 from normal amortization, early loan payoffs and contractual maturities.

The $15.7 million in provision for losses on covered loans in the current period was due to incremental loan losses incurred in the current period which were in excess of those expected from the re-measurement of cash flows during the fourth quarter of 2011.  These incremental loan losses reduced expected future cash flows and, when discounted at current yields, resulted in impairment.  The $15.7 million in provision expense is partially off-set by a $12.5 million favorable adjustment to the change in FDIC loss-sharing asset.

The $1.7 million change in the FDIC loss sharing asset in the current quarter affected noninterest income and consists of $13.9 million of scheduled amortization expense, the $12.5 million favorable adjustment described above and approximately $300 thousand of expense related to covered other real estate owned.

Net Interest Margin

Columbia's net interest margin increased to 6.67% in the first quarter of 2012, up from 5.80% for the same period last year and down from 7.14% for the fourth quarter 2011.  The Company's net interest margin is impacted significantly by the accounting for acquired loans. The net interest margin for the current quarter reflects additional loan volumes and higher loan yields arising, in part, from the three FDIC-assisted acquisitions completed in the second and third quarters of 2011.

The following table shows the impact to interest income and the related impact to the net interest margin resulting from accretion of income on certain acquired loan portfolios for the periods presented.



Three Months Ended



March 31, 2012


March 31, 2011



(dollars in thousands)

Interest income as recorded


$

32,902



$

21,302


Less: Interest income at stated note rate


10,481



8,931


Incremental accretion income


$

22,421



$

12,371


Incremental accretion income due to:





Acquired impaired loans


$

19,320



$

12,371


Other acquired loans



3,101





Stated interest income at loan note rate


$

22,421



$

12,371


Reported net interest margin


6.67

%


5.80

%

Net interest margin excluding additional accretion income


4.49

%


4.42

%

The net interest margin was impacted favorably by reduced funding costs.  The average cost of interest-bearing deposits decreased to 0.27% for the current quarter from 0.51% for the prior-year period while the average cost of all interest-bearing liabilities decreased to 0.38% from 0.65%.

Balance Sheet

At March 31, 2012, Columbia's total assets were $4.82 billion, an increase of 13% from $4.26 billion at March 31, 2011, and 1% from $4.79 billion at December 31, 2011.  Total shareholders' equity at March 31, 2012 was $752.7 million, an increase of 5% from $714.1 million at March 31, 2011 and a decrease of 1% from $759.3 million at December 31, 2011.

Noncovered loans were $2.37 billion at March 31, 2012, up 26% from $1.88 billion at March 31, 2011 and up 1% from $2.35 billion at December 31, 2011.   The average yield on loans for the quarter ended March 31, 2012 was 8.7%, including additional accretion from the acquired loan portfolios.  Net noncovered loan growth for the first quarter 2012 was approximately $23 million.  Securities were $1.02 billion at March 31, 2012, compared to $1.05 billion at December 31, 2011.

Total deposits at March 31, 2012 increased 16% to $3.87 billion from $3.34 billion at March 31, 2011, and 1% from $3.82 billion at December 31, 2011.  Core deposits (defined as demand, savings, money market accounts and certificates of deposit under $100,000) comprised 93% of total deposits, and were $3.59 billion at March 31, 2012, an increase of 19% from $3.03 billion at March 31, 2011, and 2% from $3.51 billion at December 31, 2011. 

Asset Quality

At March 31, 2012, nonperforming noncovered assets were $79.1 million, compared to $85.4 million at December 31, 2011.  The balance of the originated and discounted loan portfolios remained stable for the quarter, with modest improvements in the 1-4 family real estate construction and consumer portfolios. 

For the quarter, the Company reduced noncovered other property owned (OPPO) and other real estate owned (OREO) by $14.1 million and placed $814 thousand of previously nonperforming loans back on accrual status.  In addition, the Company added $14.7 million in new nonperforming assets, experienced charge-offs associated with nonperforming assets of $3.5 million, and received payments of $2.5 million.

The table below sets forth information with respect to nonaccrual loans, restructured loans, total nonperforming loans and total nonperforming assets. 



March 31, 2012


December 31, 2011



(dollars in thousands)

Nonaccrual noncovered loans:





Commercial business


$

14,791



$

10,243


Real estate:





One-to-four family residential


2,624



2,696


Commercial and multifamily residential


24,872



19,485


Total real estate


27,496



22,181


Real estate construction:





One-to-four family residential


8,793



10,785


Commercial and multifamily residential


5,023



7,067


Total real estate construction


13,816



17,852


Consumer


1,449



3,207


Total nonaccrual loans


57,552



53,483


Noncovered other real estate owned and other personal property owned


21,571



31,905


Total nonperforming noncovered assets


$

79,123



$

85,388


Allowance for loan losses to period-end nonperforming noncovered loans


90.84

%


99.17

%

For the quarter ended March 31, 2012, net loan charge-offs were $5.3 million, compared to $5.7 million for the same period a year ago, and $2.1 million last quarter.  Net charge-offs were primarily centered in commercial business and commercial real estate loans.

The following table provides an analysis of the Company's allowance for originated and discounted loan and lease losses at the dates and the periods indicated.



Three Months Ended March 31,



2012


2011



(in thousands)

Beginning balance


$

53,041



$

60,993


Charge-offs:





Commercial business


(2,359)



(3,371)


One-to-four family residential real estate


(116)



(448)


Commercial and multifamily residential real estate


(2,678)



(365)


One-to-four family residential real estate construction


(204)



(1,427)


Commercial and multifamily residential real estate construction




(487)


Consumer


(1,093)



(925)


Total charge-offs


(6,450)



(7,023)


Recoveries:





Commercial business


658



105


One-to-four family residential real estate


43




Commercial and multifamily residential real estate


71



73


One-to-four family residential real estate construction


47



1,104


Commercial and multifamily residential real estate construction





Consumer


373



63


Total recoveries


1,192



1,345


Net charge-offs


(5,258)



(5,678)


Provision charged to expense


4,500




Ending balance


$

52,283



$

55,315


The provision for noncovered loan losses was primarily impacted by the Company's organic loan growth of $75 million in originated loans.  For the fourth quarter of 2011, the provision for noncovered loans was $4.75 million.

The allowance for noncovered loan losses to period end loans was 2.20% at March 31, 2012 compared to 2.26% at December 31, 2011 and 2.94% at March 31, 2011.

First Quarter 2012 Operating Results

Quarter ended March 31, 2012

Net Interest Income

Net interest income for the first quarter of 2012 was $67.1 million, an increase of 33% from $50.4 million for the same quarter in 2011, primarily due to organic loan growth and the impact of our FDIC-assisted transactions. 

Average interest-earning assets were $4.14 billion during the first quarter, an increase of 14% compared with $3.63 billion during the same quarter of 2011.   The yield on average interest-earning assets increased to 6.93% during the first quarter compared with 6.26% in the same quarter of 2011.  During the same period, average interest-bearing liabilities increased to $2.82 billion from $2.60 billion.

Noninterest Income (Loss)

Total noninterest income was $9.6 million for the first quarter of 2012, compared to a loss of $5.4 million a year earlier.  The increase for the three months ended March 31, 2012 was primarily due to the change in the FDIC loss-sharing asset, increased merchant services revenue, and improved realization of assessable service fee income across our acquired branch network.  Changes in the FDIC loss-sharing asset are primarily driven by amortization of the FDIC loss-sharing asset and provision for reimbursable losses on FDIC covered loans.  For the first three months of 2012, amortization of the FDIC loss-sharing asset was $13.9 million which was offset by a $12.5 million increase in the FDIC loss-sharing asset related to the provision for covered loan losses.  For the same period in 2011, $13.6 million of amortization was combined with a $338 thousand decrease of the FDIC loss sharing-asset related to a recapture of losses on covered loans. 

Noninterest Expense

Total noninterest expense for the first quarter of 2012 was $44.4 million, an increase of 19% from $37.3 million for the same quarter in 2011.   The increase was attributable to the additional operating expenses of the three FDIC-assisted bank acquisitions completed since May 2011.  The most significant increases were in compensation and employee benefits, occupancy, and other noninterest expense.  Compensation and employee benefits increased $3.1 million, primarily due to an increase in the number of employees related to our acquisitions as compared to the same period in 2011. Occupancy expense increased $936 thousand primarily as a result of the addition of 17 branch locations acquired.  Other noninterest expense increased $1.9 million, substantially due to $2.2 million in write-downs of OPPO. These increases were partially offset by a $1.3 million decrease in regulatory premiums due to a decrease in the assessment rate utilized in calculating premiums due.             

Strategic Focus

Ms. Dressel commented, "The Bank of Whitman integration was completed during the first quarter; all of our acquisitions are now fully integrated, both technically and culturally. Ms. Dressel continued, "Going forward in 2012, we will be externally focused on business development efforts to increase our market share, continuing to improve the credit metrics in our loan portfolio and improving the efficiency ratio of the Company, which includes growing into our new footprint."

Conference Call

Columbia's management will discuss the first quarter 2012 results on a conference call scheduled for Thursday, April 26, 2012 at 1:00 PDT.  Interested parties may listen to this discussion by calling 1-866-378-3802; Conference ID code #70317901.

A conference call replay will be available from approximately 4:00 p.m. PDT on April 26, 2012 through midnight PDT on May 26, 2012.  The conference call replay can be accessed by dialing 1-855-859-2056 and entering Conference ID code #70317901.

About Columbia       

Headquartered in Tacoma, Washington, Columbia Banking System, Inc. is the holding Company of Columbia State Bank, a Washington state-chartered full-service commercial bank which was again awarded one of Seattle Business Magazine's 100 Best Companies to Work For 2011 and was designated one of  Puget Sound Business Journal's "Washington's Best Workplaces 2011." 

Columbia Banking System has 102 banking offices, including 77 branches in Washington State and 25 branches in Oregon. Columbia Bank does business under the Bank of Astoria name in Astoria, Warrenton, Seaside, Cannon Beach, Manzanita and Tillamook in Oregon. More information about Columbia can be found on its website at www.columbiabank.com.

Note Regarding Forward-Looking Statements

This news release includes forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which management believes are a benefit to shareholders.  These forward looking statements describe Columbia's management's expectations regarding future events and developments such as future operating results, growth in loans and deposits, continued success of Columbia's style of banking and the strength of the local economy.  The words "will," "believe," "expect," "intend," "should," and "anticipate" and words of similar construction are intended in part to help identify forward looking statements.   Future events are difficult to predict, and the expectations described above are necessarily subject to risk and uncertainty that may cause actual results to differ materially and adversely.  In addition to discussions about risks and uncertainties set forth from time to time in Columbia's filings with the Securities and Exchange Commission, available at the SEC's website at www.sec.gov and the Company's website at www.columbiabank.com, including the "Risk Factors," "Business" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of our annual reports on Form 10-K and quarterly reports on Form 10-Q, factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include, among others, the following:  (1) local, national and international economic conditions may be less favorable than expected or have a more direct and pronounced effect on Columbia than expected and adversely affect Columbia's ability to continue its internal growth at historical rates and maintain the quality of its earning assets; (2) changes in interest rates may reduce interest margins more than expected and negatively affect funding sources; (3) projected business increases following strategic expansion or opening or acquiring new branches may be lower than expected; (4) costs or difficulties related to the integration of acquisitions may be greater than expected; (5) competitive pressure among financial institutions may increase significantly; and (6) legislation or regulatory requirements or changes may adversely affect the businesses in which Columbia is engaged.  We believe the expectations reflected in our forward-looking statements are reasonable, based on information available to us on the date hereof. However, given the described uncertainties and risks, we cannot guarantee our future performance or results of operations and you should not place undue reliance on these forward-looking statements. We undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. The factors noted above and the risks and uncertainties described in our SEC filings should be considered when reading any forward-looking statements in this release.

Contacts: 

Melanie J. Dressel, President and
Chief Executive Officer
(253) 305-1911

Gary R. Schminkey, Executive Vice President
and Chief Financial Officer
(253) 305-1966

 

FINANCIAL STATISTICS













Columbia Banking System, Inc.


Three Months Ended









Unaudited


March 31,











2012


2011









Earnings


(dollars in thousands except per share)









Net interest income


$

67,063



$

50,449










Provision for loan and lease losses


$

4,500



$










Provision (recapture) for losses on covered loans (5)


$

15,685



$

(422)










Noninterest income (loss)


$

9,574



$

(5,419)










Noninterest expense


$

44,352



$

37,346










Net income


$

8,902



$

5,779










Per Common Share













Earnings (basic)


$

0.22



$

0.15










Earnings (diluted)


$

0.22



$

0.15










Book value per common share


$

18.97



$

18.09










Averages













Total assets


$

4,776,186



$

4,268,348










Interest-earning assets


$

4,137,449



$

3,632,663










Loans, including covered loans


$

2,860,524



$

2,388,076










Securities


$

1,023,067



$

767,360










Deposits


$

3,805,324



$

3,306,168










Core deposits


$

3,512,490



$

2,989,825










Interest-bearing deposits


$

2,672,911



$

2,429,821










Interest-bearing liabilities


$

2,815,753



$

2,596,833










Noninterest-bearing deposits


$

1,132,413



$

876,347










Shareholders' equity


$

761,686



$

710,282










Financial Ratios













Return on average assets


0.75

%


0.55

%









Return on average common equity


4.70

%


3.30

%









Average equity to average assets


15.95

%


16.64

%









Net interest margin


6.67

%


5.80

%









Efficiency ratio (tax equivalent)(1)


71.48

%


73.33

%











March 31,


December 31,







Period end


2012


2011


2011







Total assets


$

4,815,432



$

4,264,319



$

4,785,945








Covered assets, net


$

526,043



$

499,872



$

560,055








Loans, excluding covered loans, net


$

2,371,818



$

1,884,206



$

2,348,371








Allowance for noncovered loan and lease losses


$

52,283



$

55,315



$

53,041








Securities


$

1,021,428



$

906,096



$

1,050,325








Deposits


$

3,865,445



$

3,336,213



$

3,815,529








Core deposits


$

3,591,663



$

3,027,898



$

3,510,435








Shareholders' equity


$

752,703



$

714,083



$

759,338








Nonperforming, noncovered assets













Nonaccrual loans


$

57,552



$

78,692



$

53,483








Other real estate owned ("OREO") and other personal property owned ("OPPO")


21,571



29,315



31,905








Total nonperforming, noncovered assets


$

79,123



$

108,007



$

85,388








Nonperforming assets to period-end noncovered loans + OREO and OPPO


3.31

%


5.64

%


3.59

%







Nonperforming loans to period-end noncovered loans


2.43

%


4.18

%


2.28

%







Nonperforming assets to period-end noncovered assets


1.84

%


2.87

%


2.02

%







Allowance for loan and lease losses to period-end noncovered loans


2.20

%


2.94

%


2.26

%







Allowance for loan and lease losses to nonperforming noncovered loans


90.84

%


70.29

%


99.17

%







Net noncovered loan charge-offs


$

5,258


(2)

$

5,678


(3)

$

15,352


(4)



















(1)  Noninterest expense, excluding net cost of operation of other real estate and FDIC clawback liability expense, divided by the sum of net interest income and noninterest income on a tax equivalent basis, excluding gain/loss on sale of investment securities, impairment charge on investment securities, gain on bank acquisition, incremental accretion income on the acquired loan portfolio and the change in FDIC indemnification asset.






(2)  For the three months ended March 31, 2012.






(3)  For the three months ended March 31, 2011.






(4)  For the twelve months ended December 31, 2011.






(5) Provision (recapture) for losses on covered loans was partially offset by $12.5 million in income and $338 thousand in expense recorded to Change in FDIC loss-sharing asset in the Consolidated Statements of Income for the three months ended March 31, 2012 and 2011, respectively.







FINANCIAL STATISTICS









Columbia Banking System, Inc.









Unaudited


March 31,


December 31,



2012


2011

Loan Portfolio Composition


(dollars in thousands)

Noncovered loans:









Commercial business


$

1,079,356



45.5

%


$

1,031,721



43.9

%

Real estate:









One-to-four family residential


58,843



2.5

%


64,491



2.8

%

Commercial and multifamily residential


992,403



41.8

%


998,165



42.5

%

Total real estate


1,051,246



44.3

%


1,062,656



45.3

%

Real estate construction:









One-to-four family residential


48,559



2.0

%


50,208



2.1

%

Commercial and multifamily residential


35,567



1.5

%


36,768



1.6

%

Total real estate construction


84,126



3.5

%


86,976



3.7

%

Consumer


169,955



7.2

%


183,235



7.8

%

Subtotal loans


2,384,683



100.5

%


2,364,588



100.7

%

Less:  Net unearned income


(12,865)



(0.5)

%


(16,217)



(0.7)

%

Total noncovered loans, net of unearned income


2,371,818



100.0

%


2,348,371



100.0

%

Less:  Allowance for loan and lease losses


(52,283)





(53,041)




Noncovered loans, net


2,319,535





2,295,330




Covered loans, net of allowance for loan losses of ($20,504) and ($4,944), respectively


501,613





531,929




Total loans, net


$

2,821,148





$

2,827,259




Loans held for sale


$

2,066





$

2,148















March 31,


December 31,



2012


2011

Deposit Composition


(dollars in thousands)

Core deposits:









Demand and other non-interest bearing


$

1,159,308



30.0

%


$

1,156,610



30.3

%

Interest bearing demand


794,157



20.5

%


735,340



19.3

%

Money market


1,053,120



27.2

%


1,031,664



27.0

%

Savings


296,138



7.7

%


283,416



7.4

%

Certificates of deposit less than $100,000


288,939



7.5

%


303,405



8.0

%

Total core deposits


3,591,662



92.9

%


3,510,435



92.0

%










Certificates of deposit greater than $100,000


247,886



6.4

%


262,731



6.9

%

Certificates of deposit insured by CDARS®


25,672



0.7

%


42,080



1.1

%

Subtotal


3,865,220



100.0

%


3,815,246



100.0

%

Premium resulting from acquisition date fair value adjustment


225





283




Total deposits


$

3,865,445





$

3,815,529




 

 


FINANCIAL STATISTICS









Columbia Banking System, Inc.









Unaudited
















March 31,


December 31,



2012


2011

OREO and OPPO Composition


OREO


OPPO


OREO


OPPO



(in thousands)

Covered


$

24,430



$



$

28,126



$


Noncovered


16,744



4,827



22,893



9,011


Total


$

41,174



$

4,827



$

51,019



$

9,011













Three Months Ended





March 31,


December 31,



OREO and OPPO Earnings Impact


2012


2011


2011



Net cost of operation of noncovered OREO


$

2,693



$

2,118



$

923




Net benefit of operation of covered OREO


(1,783)



(2,560)



(1,522)




Net cost (benefit) of operation of OREO


$

910



$

(442)



$

(599)













Noncovered OPPO expense, net


$

2,154



$



$

22




Covered OPPO expense, net


2








OPPO expense, net (1)


$

2,156



$



$

22













(1) OPPO expense, net is included in Other noninterest expense in the Consolidated Statements of Income.

 

 


QUARTERLY FINANCIAL STATISTICS











Columbia Banking System, Inc.


Three Months Ended

Unaudited


March 31,


December 31,


September 30,


June 30,


March 31,



2012


2011


2011


2011


2011



(dollars in thousands except per share)

Earnings



Net interest income


$

67,063



$

72,124



$

64,788



$

49,375



$

50,449


Provision for loan and lease losses


$

4,500



4,750



$

500



$

2,150



$


Provision (recapture) for losses on covered loans


$

15,685



$

(3,960)



$

433



$

2,301



$

(422)


Noninterest income (loss)


$

9,574



$

(9,602)



$

2,196



$

3,542



$

(5,419)


Noninterest expense


$

44,352



$

41,314



$

39,935



$

37,164



$

37,346


Net income


$

8,902



$

14,754



$

18,872



$

8,632



$

5,779


Per Common Share











Earnings (basic)


$

0.22



$

0.37



$

0.48



$

0.22



$

0.15


Earnings (diluted)


$

0.22



$

0.37



$

0.48



$

0.22



$

0.15


Book value


$

18.97



$

19.23



$

18.99



$

18.43



$

18.09


Averages











Total assets


$

4,776,186



$

4,755,222



$

4,680,901



$

4,324,390



$

4,268,348


Interest-earning assets


$

4,137,449



$

4,098,603



$

4,028,029



$

3,719,558



$

3,632,663


Loans, including covered loans


$

2,860,524



$

2,817,279



$

2,777,681



$

2,439,439



$

2,388,076


Securities


$

1,023,067



$

957,727



$

998,775



$

988,839



$

767,360


Deposits


$

3,805,324



$

3,791,169



$

3,678,931



$

3,382,486



$

3,306,168


Core deposits


$

3,512,490



$

3,472,023



$

3,332,234



$

3,073,068



$

2,989,825


Interest-bearing deposits


$

2,672,911



$

2,664,133



$

2,651,664



$

2,479,485



$

2,429,821


Interest-bearing liabilities


$

2,815,753



$

2,808,497



$

2,813,396



$

2,647,990



$

2,596,833


Noninterest-bearing deposits


$

1,132,413



$

1,127,036



$

1,027,268



$

903,001



$

876,347


Shareholders' equity


$

761,686



$

757,696



$

735,192



$

719,165



$

710,282


Financial Ratios











Return on average assets


0.75

%


1.23

%


1.60

%


0.80

%


0.55

%

Return on average common equity


4.70

%


7.73

%


10.18

%


4.81

%


3.30

%

Average equity to average assets


15.95

%


15.93

%


15.71

%


16.63

%


16.64

%

Net interest margin


6.67

%


7.14

%


6.53

%


5.49

%


5.80

%

Efficiency ratio (tax equivalent)


71.48

%


69.56

%


69.17

%


69.49

%


73.33

%

Period end











Total assets


$

4,815,432



$

4,785,945



$

4,755,832



$

4,429,143



$

4,264,319


Covered assets, net


$

526,043



$

560,055



$

595,640



$

631,549



$

499,872


Loans, excluding covered loans, net


$

2,371,818



$

2,348,371



$

2,257,899



$

1,987,474



$

1,884,206


Allowance for noncovered loan and lease losses


$

52,283



$

53,041



$

50,422



$

54,057



$

55,315


Securities


$

1,021,428



$

1,050,325



$

1,018,069



$

1,008,559



$

906,096


Deposits


$

3,865,445



$

3,815,529



$

3,795,499



$

3,475,167



$

3,336,213


Core deposits


$

3,591,663



$

3,510,435



$

3,464,705



$

3,142,975



$

3,027,898


Shareholders' equity


$

752,703



$

759,338



$

749,966



$

727,680



$

714,083


Nonperforming, noncovered assets











Nonaccrual loans


$

57,552



$

53,483



$

55,183



$

59,404



$

78,692


OREO and OPPO


21,571



31,905



34,069



37,116



29,315


Total nonperforming, noncovered assets


$

79,123



$

85,388



$

89,252



$

96,520



$

108,007


Nonperforming assets to period-end noncovered loans + OREO and OPPO


3.31

%


3.59

%


3.89

%


4.77

%


5.64

%

Nonperforming loans to period-end noncovered loans


2.43

%


2.28

%


2.44

%


2.99

%


4.18

%

Nonperforming assets to period-end noncovered assets


1.84

%


2.02

%


2.15

%


2.54

%


2.87

%

Allowance for loan and lease losses to period-end noncovered loans


2.20

%


2.26

%


2.23

%


2.72

%


2.94

%

Allowance for loan and lease losses to nonperforming noncovered loans


90.84

%


99.17

%


91.37

%


91.00

%


70.29

%

Net noncovered loan charge-offs


$

5,258



$

2,131



$

4,135



$

3,408



$

5,678



CONSOLIDATED STATEMENTS OF INCOME



Columbia Banking System, Inc.


Three Months Ended

Unaudited


March 31,



2012


2011



(in thousands except per share)

Interest Income





Loans


$

61,777



$

47,429


Taxable securities


5,245



4,417


Tax-exempt securities


2,525



2,467


Federal funds sold and deposits in banks


165



298


Total interest income


69,712



54,611


Interest Expense





Deposits


1,779



3,079


Federal Home Loan Bank advances


750



694


Long-term obligations




251


Other borrowings


120



138


Total interest expense


2,649



4,162


Net Interest Income


67,063



50,449


Provision for loan and lease losses


4,500




Provision (recapture) for losses on covered loans


15,685



(422)


Net interest income after provision (recapture)


46,878



50,871


Noninterest Income (Loss)





Service charges and other fees


7,177



6,288


Merchant services fees


2,018



1,633


Gain on sale of investment securities, net


62




Bank owned life insurance


711



505


Change in FDIC loss-sharing asset


(1,668)



(14,774)


Other


1,274



929


Total noninterest income (loss)


9,574



(5,419)


Noninterest Expense





Compensation and employee benefits


21,995



18,921


Occupancy


5,333



4,397


Merchant processing


873



883


Advertising and promotion


882



901


Data processing and communications


2,213



1,924


Legal and professional fees


1,609



1,413


Taxes, licenses and fees


1,355



865


Regulatory premiums


860



2,195


Net cost (benefit) of operation of other real estate


910



(442)


Amortization of intangibles


1,150



984


Other


7,172



5,305


Total noninterest expense


44,352



37,346


Income before income taxes


12,100



8,106


Provision for income taxes


3,198



2,327


Net Income


$

8,902



$

5,779


Earnings per common share





Basic


$

0.22



$

0.15


Diluted


$

0.22



$

0.15


Dividends paid per common share


$

0.37



$

0.03


Weighted average number of common shares outstanding


39,195



39,043


Weighted average number of diluted common shares outstanding


39,298



39,156


 


CONSOLIDATED BALANCE SHEETS








Columbia Banking System, Inc.








Unaudited





March 31,


December 31,






2012


2011






(in thousands)

ASSETS



Cash and due from banks


$

93,904



$

91,364


Interest-earning deposits with banks and federal funds sold


297,553



202,925


Total cash and cash equivalents


391,457



294,289


Securities available for sale at fair value (amortized cost of $961,296 and $987,560, respectively)


999,213



1,028,110


Federal Home Loan Bank stock at cost


22,215



22,215


Loans held for sale


2,066



2,148


Loans, excluding covered loans, net of unearned income of ($12,865) and ($16,217), respectively


2,371,818



2,348,371


Less: allowance for loan and lease losses


52,283



53,041


Loans, excluding covered loans, net


2,319,535



2,295,330


Covered loans, net of allowance for loan losses of ($20,504) and ($4,944), respectively


501,613



531,929


Total loans, net


2,821,148



2,827,259


FDIC loss-sharing asset


159,061



175,071


Interest receivable


16,037



15,287


Premises and equipment, net


113,071



107,899


Other real estate owned ($24,430 and $28,126 covered by Federal Deposit Insurance Corporation loss share, respectively)


41,174



51,019


Goodwill


115,554



115,554


Core deposit intangible, net


19,016



20,166


Other assets


115,420



126,928


Total assets


$

4,815,432



$

4,785,945


LIABILITIES AND SHAREHOLDERS' EQUITY





Deposits:





Noninterest-bearing


$

1,159,308



$

1,156,610


Interest-bearing


2,706,137



2,658,919


Total deposits


3,865,445



3,815,529


Federal Home Loan Bank advances


114,715



119,009


Securities sold under agreements to repurchase


25,000



25,000


Other liabilities


57,569



67,069


Total liabilities


4,062,729



4,026,607


Commitments and contingent liabilities









March 31,


December 31,






2012


2011





Common stock (no par value)








Authorized shares

63,033



63,033






Issued and outstanding

39,670



39,506



579,894



579,136


Retained earnings


149,348



155,069


Accumulated other comprehensive income


23,461



25,133


Total shareholders' equity


752,703



759,338


Total liabilities and shareholders' equity


$

4,815,432



$

4,785,945


 

SOURCE Columbia Banking System, Inc.



RELATED LINKS
http://www.columbiabank.com

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