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As Of Filer Filing For·On·As Docs:Size Issuer Filing Agent 1/22/21 People’s United Financial, Inc. 8-K:2,7,9 1/21/21 13:7.6M Donnelley … Solutions/FA |
Document/Exhibit Description Pages Size 1: 8-K Current Report HTML 30K 2: EX-99.1 Miscellaneous Exhibit HTML 507K 3: EX-99.2 Miscellaneous Exhibit HTML 24K 9: R1 Document and Entity Information HTML 51K 11: XML IDEA XML File -- Filing Summary XML 13K 8: XML XBRL Instance -- d100948d8k_htm XML 18K 10: EXCEL IDEA Workbook of Financial Reports XLSX 6K 5: EX-101.DEF XBRL Definitions -- pbct-20210121_def XML 40K 6: EX-101.LAB XBRL Labels -- pbct-20210121_lab XML 66K 7: EX-101.PRE XBRL Presentations -- pbct-20210121_pre XML 42K 4: EX-101.SCH XBRL Schema -- pbct-20210121 XSD 15K 12: JSON XBRL Instance as JSON Data -- MetaLinks 14± 21K 13: ZIP XBRL Zipped Folder -- 0001193125-21-014212-xbrl Zip 57K
| EX-99.1 |
Exhibit 99.1
People’s United Financial Reports Fourth Quarter Net Income of $207.7 Million, or $0.49 per Common Share
Operating Earnings of $0.35 per Common Share
| • | Sustained excellent asset quality as evidenced by net loan charge-offs to average total loans of 12 basis points and provision for credit losses of $14.7 million, both of which improved from the third quarter. |
| • | Increased period-end deposits $2.5 billion or 5 percent from September 30, primarily due to continued strong growth in non-interest bearing balances. |
| • | Completed the sale of People’s United Insurance Agency on November 2; realized a pre-tax gain, net of expenses, of $75.9 million or $0.14 per common share. |
BRIDGEPORT, CT., January 21, 2021 – People’s United Financial, Inc. (NASDAQ: PBCT) today reported results for the fourth quarter and full year 2020. These results along with comparison periods are summarized below:
| ($ in millions, except per common share data) | ||||||||||||||||||||
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||
| Dec. 31, 2020 | Sep. 30, 2020 | Dec. 31, 2019 | Dec. 31, 2020 | Dec. 31, 2019 | ||||||||||||||||
| Net income |
$ | 207.7 | $ | 144.6 | $ | 137.5 | $ | 572.6 | $ | 520.4 | ||||||||||
| Net income available to common shareholders |
204.2 | 141.1 | 134.0 | 558.5 | 506.3 | |||||||||||||||
| Per common share |
0.49 | 0.34 | 0.31 | 1.32 | 1.27 | |||||||||||||||
| Operating earnings1 |
147.7 | 144.7 | 158.8 | 534.6 | 552.1 | |||||||||||||||
| Per common share |
0.35 | 0.34 | 0.37 | 1.27 | 1.39 | |||||||||||||||
| Net interest income |
$ | 382.8 | $ | 391.4 | $ | 382.7 | $ | 1,575.8 | $ | 1,412.3 | ||||||||||
| Net interest margin |
2.84 | % | 2.97 | % | 3.14 | % | 2.99 | % | 3.14 | % | ||||||||||
| Non-interest income |
178.2 | 101.1 | 124.2 | 492.7 | 431.1 | |||||||||||||||
| Operating non-interest income1 |
102.3 | 101.1 | 116.6 | 416.8 | 423.5 | |||||||||||||||
| Non-interest expense |
$ | 293.4 | $ | 293.6 | $ | 325.7 | $ | 1,211.1 | $ | 1,162.7 | ||||||||||
| Operating non-interest expense1 |
288.5 | 289.0 | 286.6 | 1,165.2 | 1,097.1 | |||||||||||||||
| Efficiency ratio |
55.5 | % | 53.8 | % | 53.7 | % | 54.2 | % | 55.8 | % | ||||||||||
| Average balances |
||||||||||||||||||||
| Loans |
$ | 44,061 | $ | 44,853 | $ | 42,006 | $ | 44,382 | $ | 38,419 | ||||||||||
| Deposits |
50,674 | 49,542 | 42,195 | 48,217 | 39,143 | |||||||||||||||
| Period-end balances |
||||||||||||||||||||
| Loans |
43,869 | 45,231 | 43,596 | |||||||||||||||||
| Deposits |
52,138 | 49,637 | 43,590 | |||||||||||||||||
| 1 | See Non-GAAP Financial Measures and Reconciliation to GAAP beginning on page 16. |
“We are pleased with our performance in 2020, especially in light of the uncertain economic environment caused by the pandemic,” said Jack Barnes, Chairman and Chief Executive Officer. “Full year financial and operating results were strong and reflect the resilience of People’s United, its employees and customers. Pre-provision net revenue of $827 million, on an operating basis, increased 12 percent from the prior year, reflecting the success of recent acquisitions and solid execution across core operations. Higher revenues and continued emphasis on controlling costs lowered the efficiency ratio 160 basis points to 54.2 percent, marking the seventh consecutive year of improvement. Asset quality remained excellent, indicative of the Company’s conservative approach to underwriting, diversified loan portfolio, and deep customer relationships. We are particularly pleased by the continued reduction in loan deferrals, which ended the year at $271 million or 0.6 percent of total loans, down from $1.6 billion or 3.5 percent of total loans at the close of the third quarter.”
Barnes continued, “As consumer preferences evolve to more digitally-driven experiences, we have continually enhanced our technology capabilities to deliver value, provide convenience and create efficiencies. As a result, customers are increasingly utilizing our online and mobile platforms for their banking needs. Given these accelerating digital banking trends and shifts in retail shopping behavior, we announced today the decision not to renew our existing in-store branch contracts with Stop & Shop in Connecticut and New York upon expiration in 2022. This decision enables us to further optimize our branch network, while providing the same level of personalized service across each of our channels.”
“We concluded the year with a solid financial performance in the fourth quarter,” stated David Rosato, Senior Executive Vice President and Chief Financial Officer. “Operating earnings of $147.7 million increased two percent linked-quarter and benefited from a lower provision, higher fee income and well-controlled expenses. Net interest margin of 2.84 percent was 13 basis points lower than the third quarter, primarily due to increased excess liquidity and lower yields in both the loan and securities portfolios. These headwinds were partially offset by our continued discipline managing deposit pricing as costs declined for the sixth consecutive quarter. The loan-to-deposit ratio at quarter-end was 84 percent as loans decreased nearly $1.4 billion or three percent from September 30, while deposits grew $2.5 billion or five percent. The decline in period-end loans was primarily driven by $715 million in lower retail balances, $289 million in forgiven PPP loans, and a combined $107 million reduction in our runoff portfolios. Conversely, we continued to achieve strong growth in our mortgage warehouse and LEAF businesses. Period-end deposit growth reflected a $1.8 billion increase in non-interest bearing balances, partially offset by the roll-off of higher cost time deposits.”
| As of and for the Three Months Ended | ||||||||||||
| Dec. 31, 2020 | Sep. 30, 2020 | Dec. 31, 2019 | ||||||||||
| Asset Quality |
||||||||||||
| Net loan charge-offs to average total loans |
0.12 | % | 0.15 | % | 0.06 | % | ||||||
| Non-performing loans as a percentage of total loans1 |
0.75 | % | 0.68 | % | 0.51 | % | ||||||
| Returns |
||||||||||||
| Return on average assets2 |
1.33 | % | 0.94 | % | 0.98 | % | ||||||
| Return on average tangible common equity2 |
18.4 | % | 13.1 | % | 12.8 | % | ||||||
| Capital Ratios |
||||||||||||
| People’s United Financial, Inc. |
||||||||||||
| Tangible common equity / tangible assets |
7.5 | % | 7.5 | % | 8.0 | % | ||||||
| Tier 1 leverage |
8.4 | % | 8.2 | % | 9.1 | % | ||||||
| Common equity tier 1 |
10.5 | % | 9.9 | % | 10.2 | % | ||||||
| Tier 1 risk-based |
11.0 | % | 10.5 | % | 10.7 | % | ||||||
| Total risk-based |
12.4 | % | 11.8 | % | 12.0 | % | ||||||
| People’s United Bank, N.A. |
||||||||||||
| Tier 1 leverage |
8.7 | % | 8.7 | % | 9.3 | % | ||||||
| Common equity tier 1 |
11.5 | % | 11.0 | % | 10.9 | % | ||||||
| Tier 1 risk-based |
11.5 | % | 11.0 | % | 10.9 | % | ||||||
| Total risk-based |
12.8 | % | 12.3 | % | 12.1 | % | ||||||
| 1 | Ratios for periods prior to January 1, 2020 have been restated to reflect the total loan portfolio (originated & acquired) |
| 2 | See Non-GAAP Financial Measures and Reconciliation to GAAP beginning on page 16 |
The Board of Directors declared a $0.18 per common share quarterly dividend payable February 15, 2021 to shareholders of record on February 1, 2021. Based on the closing stock price on January 20, 2021, the dividend yield on People’s United Financial common stock is 5.0 percent.
2
The Company is currently in the process of performing its annual goodwill impairment assessment. Additional time is necessary to complete the analysis given the complexities brought about by the macroeconomic effects of the Covid-19 pandemic, particularly the current and projected low interest rate environment and a decline in bank stock valuations last fall, including on the date of the Company’s annual assessment (October 1st). Any potential goodwill impairment charge could be material to reported earnings, but would represent a non-cash charge and have no effect on the Company’s cash balances, liquidity or tangible equity. In addition, because goodwill and other intangible assets are not included in the calculation of regulatory capital, the Company’s well-capitalized regulatory capital ratios would not be affected by this potential non-cash expense. The analysis will be completed prior to filing the Annual Report on Form 10-K with the Securities and Exchange Commission.
People’s United Bank, N.A. is a subsidiary of People’s United Financial, Inc., a diversified, community-focused financial services company headquartered in the Northeast with over $63 billion in assets. Founded in 1842, People’s United Bank offers commercial and retail banking through a network of more than 400 retail locations in Connecticut, New York, Massachusetts, Vermont, New Hampshire and Maine, as well as wealth management solutions. The company also provides specialized commercial services to customers nationwide.
4Q 2020 Financial Highlights
Summary
| • | Net income totaled $207.7 million, or $0.49 per common share. |
| • | Net income available to common shareholders totaled $204.2 million. |
| • | Operating earnings totaled $147.7 million, or $0.35 per common share (see page 16). |
| • | Net interest income totaled $382.8 million in 4Q20 compared to $391.4 million in 3Q20. |
| • | Net interest margin decreased 13 basis points from 3Q20 to 2.84% reflecting: |
| • | Excess liquidity resulting from deposits at the Federal Reserve Bank (decrease of nine basis points). |
| • | Lower yields on the loan and securities portfolios (decrease of nine basis points). |
| • | Lower rates on deposits (increase of five basis points). |
| • | Provision for credit losses on loans totaled $14.7 million. |
| • | Allowance for credit losses on loans increased $1.3 million. |
| • | Net loan charge-offs totaled $13.4 million. |
| • | Net loan charge-off ratio of 0.12% in 4Q20. |
| • | Non-interest income totaled $178.2 million in 4Q20 compared to $101.1 million in 3Q20. |
| • | Commercial banking lending fees increased $2.8 million. |
| • | Customer interest rate swap income increased $1.0 million. |
| • | Insurance revenue decreased $5.6 million. |
| • | Included in non-interest income in 4Q20 is a $75.9 million net gain on the sale of People’s United Insurance Agency (see page 16). |
| • | At December 31, 2020, assets under discretionary management totaled $9.5 billion. |
| • | Non-interest expense totaled $293.4 million in 4Q20 compared to $293.6 million in 3Q20. |
| • | Operating non-interest expense totaled $288.5 million in 4Q20 and $289.0 million in 3Q20 (see page 16). |
| • | Compensation and benefits expense, excluding $0.3 million of merger-related expenses in 3Q20, increased $0.4 million. |
| • | Occupancy and equipment expense, excluding $0.3 million and $0.9 million of merger-related expenses in 4Q20 and 3Q20, respectively, increased $2.4 million. |
3
| • | Professional and outside services expense, excluding $0.8 million and $1.4 million of merger-related expenses in 4Q20 and 3Q20, respectively, increased $1.4 million. |
| • | Regulatory assessment expense decreased $1.5 million. |
| • | Other non-interest expense includes merger-related expenses of $3.8 million in 4Q20 and $2.0 million in 3Q20. |
| • | The efficiency ratio was 55.5% for 4Q20 compared to 53.8% for 3Q20 and 53.7% for 4Q19 (see page 16). |
| • | The effective income tax rate was 17.9% for 4Q20 and 18.4% for the full-year of 2020, compared to 20.2% for the full-year of 2019. |
| • | The 4Q20 and full-year 2020 effective tax rates reflect a $7.1 million benefit related to the revaluation of certain state deferred tax assets. |
Commercial Banking
| • | Commercial loans totaled $33.2 billion at December 31, 2020, a $647 million decrease from September 30, 2020. |
| • | Paycheck Protection Plan loans totaled $2.3 billion at December 31, 2020, a $289 million decrease from September 30, 2020. |
| • | The mortgage warehouse portfolio increased $161 million. |
| • | The New York multifamily portfolio decreased $47 million. |
| • | The equipment financing portfolio decreased $42 million. |
| • | Average commercial loans totaled $33.1 billion in 4Q20, an $86 million decrease from 3Q20. |
| • | Paycheck Protection Plan loans averaged $2.5 billion in 4Q20, a $69 million decrease from 3Q20. |
| • | The average mortgage warehouse portfolio increased $455 million. |
| • | The average New York multifamily portfolio decreased $53 million. |
| • | The average equipment financing portfolio decreased $9 million. |
| • | Commercial deposits totaled $22.9 billion at December 31, 2020 compared to $21.6 billion at September 30, 2020. |
| • | The ratio of non-accrual commercial loans to total commercial loans was 0.74% at December 31, 2020 compared to 0.65% at September 30, 2020. |
| • | Non-performing commercial assets totaled $255.2 million at December 31, 2020 compared to $234.1 million at September 30, 2020. |
| • | For the commercial loan portfolio, the allowance for credit losses as a percentage of commercial loans was 0.91% at December 31, 2020 compared to 0.86% at September 30, 2020. |
| • | The commercial allowance for credit losses represented 123% of non-accrual commercial loans at December 31, 2020 compared to 132% at September 30, 2020. |
Retail Banking
| • | Residential mortgage loans totaled $8.5 billion at December 31, 2020, a $577 million decrease from September 30, 2020. |
| • | Average residential mortgage loans totaled $8.8 billion in 4Q20, a $587 million decrease from 3Q20. |
| • | Home equity loans totaled $2.0 billion at December 31, 2020, a $128 million decrease from September 30, 2020. |
| • | Average home equity loans totaled $2.1 billion in 4Q20, a $110 million decrease from 3Q20. |
| • | Retail deposits totaled $29.2 billion at December 31, 2020 compared to $28.0 billion at September 30, 2020. |
4
| • | The ratio of non-accrual residential mortgage loans to residential mortgage loans was 0.73% at December 31, 2020 compared to 0.69% at September 30, 2020. |
| • | The ratio of non-accrual home equity loans to home equity loans was 1.03% at December 31, 2020 compared to 1.04% at September 30, 2020. |
| • | For the retail loan portfolio, the allowance for credit losses as a percentage of retail loans was 1.14% at December 31, 2020 compared to 1.17% at September 30, 2020. |
| • | The retail allowance for credit losses represented 146% of non-accrual retail loans at December 31, 2020 compared to 155% at September 30, 2020. |
Conference Call
On January 21, 2021, at 5 p.m., Eastern Time, People’s United Financial will host a conference call to discuss this earnings announcement. The call may be heard through www.peoples.com by selecting “Investor Relations” in the “About Us” section on the home page, and then selecting “Conference Calls” in the “News and Events” section. Additional materials relating to the call may also be accessed at People’s United Bank’s web site. The call will be archived on the web site and available for approximately 90 days.
Certain statements contained in this release are forward-looking in nature. These include all statements about People’s United Financial’s plans, objectives, expectations and other statements that are not historical facts, and usually use words such as “expect,” “anticipate,” “believe,” “should” and similar expressions. Such statements represent management’s current beliefs, based upon information available at the time the statements are made, with regard to the matters addressed. All forward-looking statements are subject to risks and uncertainties that could cause People’s United Financial’s actual results or financial condition to differ materially from those expressed in or implied by such statements. Factors of particular importance to People’s United Financial include, but are not limited to: (1) changes in general, international, national or regional economic conditions; (2) changes in interest rates; (3) changes in loan default and charge-off rates; (4) changes in deposit levels; (5) changes in levels of income and expense in non-interest income and expense related activities; (6) changes in accounting and regulatory guidance applicable to banks; (7) price levels and conditions in the public securities markets generally; (8) competition and its effect on pricing, spending, third-party relationships and revenues; (9) the successful integration of acquisitions; (10) changes in regulation resulting from or relating to financial reform legislation; (11) the outcome of the ongoing goodwill impairment analysis; and (12) the COVID-19 pandemic and its effect on the economic and business environment in which we operate. People’s United Financial does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
###
Access Information About People’s United Financial at www.peoples.com.
INVESTOR CONTACT:
Andrew S. Hersom
Investor Relations
203.338.4581
MEDIA CONTACT:
Steven Bodakowski
Corporate Communications
203.338.4202
5
People’s United Financial, Inc.
FINANCIAL HIGHLIGHTS
| As of and for the Three Months Ended | ||||||||||||||||||||
| Dec. 31, | Sept. 30, | June 30, | March 31, | Dec. 31, | ||||||||||||||||
| (dollars in millions, except per common share data) |
2020 | 2020 | 2020 | 2020 | 2019 | |||||||||||||||
| Earnings Data: |
||||||||||||||||||||
| Net interest income (fully taxable equivalent) |
$ | 390.2 | $ | 398.7 | $ | 413.0 | $ | 403.7 | $ | 390.3 | ||||||||||
| Net interest income |
382.8 | 391.4 | 405.6 | 396.0 | 382.7 | |||||||||||||||
| Provision for credit losses (1) |
14.7 | 26.8 | 80.8 | 33.5 | 7.3 | |||||||||||||||
| Non-interest income (2) |
178.2 | 101.1 | 89.6 | 123.8 | 124.2 | |||||||||||||||
| Non-interest expense (2) |
293.4 | 293.6 | 304.0 | 320.1 | 325.7 | |||||||||||||||
| Income before income tax expense |
252.9 | 172.1 | 110.4 | 166.2 | 173.9 | |||||||||||||||
| Net income |
207.7 | 144.6 | 89.9 | 130.4 | 137.5 | |||||||||||||||
| Net income available to common shareholders (2) |
204.2 | 141.1 | 86.4 | 126.9 | 134.0 | |||||||||||||||
| Selected Statistical Data: |
||||||||||||||||||||
| Net interest margin (3) |
2.84 | % | 2.97 | % | 3.05 | % | 3.12 | % | 3.14 | % | ||||||||||
| Return on average assets (2), (3) |
1.33 | 0.94 | 0.58 | 0.89 | 0.98 | |||||||||||||||
| Return on average common equity (3) |
10.7 | 7.5 | 4.6 | 6.7 | 7.2 | |||||||||||||||
| Return on average tangible common equity (2), (3) |
18.4 | 13.1 | 8.1 | 11.8 | 12.8 | |||||||||||||||
| Efficiency ratio (2) |
55.5 | 53.8 | 53.5 | 54.0 | 53.7 | |||||||||||||||
| Common Share Data: |
||||||||||||||||||||
| Earnings per common share: |
||||||||||||||||||||
| Basic |
$ | 0.49 | $ | 0.34 | $ | 0.21 | $ | 0.30 | $ | 0.31 | ||||||||||
| Diluted (2) |
0.49 | 0.34 | 0.21 | 0.30 | 0.31 | |||||||||||||||
| Dividends paid per common share |
0.1800 | 0.1800 | 0.1800 | 0.1775 | 0.1775 | |||||||||||||||
| Common dividend payout ratio (2) |
37.1 | % | 53.6 | % | 87.4 | % | 60.9 | % | 52.2 | % | ||||||||||
| Book value per common share |
$ | 18.40 | $ | 18.11 | $ | 17.95 | $ | 17.87 | $ | 17.60 | ||||||||||
| Tangible book value per common share (2) |
10.77 | 10.37 | 10.18 | 10.07 | 10.12 | |||||||||||||||
| Stock price: |
||||||||||||||||||||
| High |
13.58 | 12.36 | 13.99 | 17.00 | 17.22 | |||||||||||||||
| Low |
9.98 | 9.74 | 9.37 | 10.40 | 14.73 | |||||||||||||||
| Close |
12.93 | 10.31 | 11.57 | 11.05 | 16.90 | |||||||||||||||
| Common shares outstanding (in millions) (2) |
424.68 | 424.67 | 424.59 | 424.47 | 443.66 | |||||||||||||||
| Weighted average diluted common shares (in millions) |
420.39 | 420.29 | 420.15 | 429.77 | 424.98 | |||||||||||||||
| (1) | Provision for credit losses in 2020 reflects the application of the CECL standard and the impact of COVID-19. |
| (2) | See Non-GAAP Financial Measures and Reconciliation to GAAP beginning on page 16. |
| (3) | Annualized. |
6
People’s United Financial, Inc.
FINANCIAL HIGHLIGHTS
| As of and for the Twelve Months Ended December 31, |
||||||||
| (dollars in millions, except per common share data) |
2020 | 2019 | ||||||
| Earnings Data: |
||||||||
| Net interest income (fully taxable equivalent) |
$ | 1,605.6 | $ | 1,441.7 | ||||
| Net interest income |
1,575.8 | 1,412.3 | ||||||
| Provision for credit losses (1) |
155.8 | 28.3 | ||||||
| Non-interest income (2) |
492.7 | 431.1 | ||||||
| Non-interest expense (2) |
1,211.1 | 1,162.5 | ||||||
| Income before income tax expense |
701.6 | 652.4 | ||||||
| Net income |
572.6 | 520.4 | ||||||
| Net income available to common shareholders (2) |
558.5 | 506.3 | ||||||
| Selected Statistical Data: |
||||||||
| Net interest margin |
2.99 | % | 3.14 | % | ||||
| Return on average assets (2) |
0.94 | 1.01 | ||||||
| Return on average common equity |
7.4 | 7.4 | ||||||
| Return on average tangible common equity (2) |
12.9 | 13.4 | ||||||
| Efficiency ratio (2) |
54.2 | 55.8 | ||||||
| Common Share Data: |
||||||||
| Earnings per common share: |
||||||||
| Basic |
$ | 1.33 | $ | 1.28 | ||||
| Diluted (2) |
1.32 | 1.27 | ||||||
| Dividends paid per common share |
0.7175 | 0.7075 | ||||||
| Common dividend payout ratio (2) |
54.5 | % | 54.3 | % | ||||
| Book value per common share |
$ | 18.40 | $ | 17.60 | ||||
| Tangible book value per common share (2) |
10.77 | 10.12 | ||||||
| Stock price: |
||||||||
| High |
17.00 | 18.03 | ||||||
| Low |
9.37 | 13.81 | ||||||
| Close |
12.93 | 16.90 | ||||||
| Common shares outstanding (in millions) (2) |
424.68 | 443.66 | ||||||
| Weighted average diluted common shares (in millions) |
422.55 | 397.15 | ||||||
| (1) | Provision for credit losses in 2020 reflects the application of the CECL standard and the impact of COVID-19. |
| (2) | See Non-GAAP Financial Measures and Reconciliation to GAAP beginning on page 16. |
7
People’s United Financial, Inc.
FINANCIAL HIGHLIGHTS - Continued
| As of and for the Three Months Ended | ||||||||||||||||||||
| Dec. 31, | Sept. 30, | June 30, | March 31, | Dec. 31, | ||||||||||||||||
| (dollars in millions) |
2020 | 2020 | 2020 | 2020 | 2019 | |||||||||||||||
| Financial Condition Data: |
||||||||||||||||||||
| Total assets |
$ | 63,445 | $ | 60,871 | $ | 61,510 | $ | 60,433 | $ | 58,590 | ||||||||||
| Loans |
43,444 | 45,231 | 45,452 | 44,284 | 43,596 | |||||||||||||||
| Securities |
9,191 | 8,270 | 8,233 | 8,552 | 7,790 | |||||||||||||||
| Short-term investments |
3,766 | 439 | 987 | 744 | 317 | |||||||||||||||
| Allowance for credit losses on loans (1) |
425 | 424 | 414 | 342 | 247 | |||||||||||||||
| Goodwill and other acquisition-related intangible assets |
3,199 | 3,244 | 3,254 | 3,264 | 3,275 | |||||||||||||||
| Deposits |
52,138 | 49,637 | 49,934 | 44,741 | 43,590 | |||||||||||||||
| Borrowings |
1,148 | 1,237 | 1,782 | 5,911 | 5,155 | |||||||||||||||
| Notes and debentures |
1,010 | 1,012 | 1,015 | 1,013 | 993 | |||||||||||||||
| Stockholders’ equity |
7,956 | 7,831 | 7,763 | 7,726 | 7,947 | |||||||||||||||
| Total risk-weighted assets (2): |
||||||||||||||||||||
| People’s United Financial, Inc. |
45,056 | 45,756 | 45,657 | 46,408 | 45,208 | |||||||||||||||
| People’s United Bank, N.A. |
44,996 | 45,685 | 45,615 | 46,397 | 45,174 | |||||||||||||||
| Non-accrual loans |
329 | 306 | 296 | 240 | 224 | |||||||||||||||
| Net loan charge-offs |
13.4 | 17.3 | 8.5 | 10.6 | 6.7 | |||||||||||||||
| Average Balances: |
||||||||||||||||||||
| Loans |
$ | 44,061 | $ | 44,853 | $ | 45,153 | $ | 43,460 | $ | 42,006 | ||||||||||
| Securities (3) |
8,390 | 7,922 | 8,240 | 8,022 | 7,372 | |||||||||||||||
| Short-term investments |
2,582 | 842 | 774 | 289 | 294 | |||||||||||||||
| Total earning assets |
55,034 | 53,617 | 54,168 | 51,772 | 49,673 | |||||||||||||||
| Total assets |
62,396 | 61,293 | 61,841 | 58,604 | 56,130 | |||||||||||||||
| Deposits |
50,674 | 49,542 | 48,447 | 44,163 | 42,195 | |||||||||||||||
| Borrowings |
1,233 | 1,283 | 2,911 | 4,353 | 4,146 | |||||||||||||||
| Notes and debentures |
1,011 | 1,014 | 1,014 | 1,000 | 974 | |||||||||||||||
| Total funding liabilities |
52,918 | 51,839 | 52,372 | 49,515 | 47,314 | |||||||||||||||
| Stockholders’ equity |
7,884 | 7,801 | 7,757 | 7,804 | 7,654 | |||||||||||||||
| Ratios: |
||||||||||||||||||||
| Net loan charge-offs to average total loans (annualized) |
0.12 | % | 0.15 | % | 0.08 | % | 0.10 | % | 0.06 | % | ||||||||||
| Non-performing assets to total loans, real estate owned and repossessed assets |
0.78 | 0.71 | 0.69 | 0.59 | 0.57 | |||||||||||||||
| Allowance for credit losses on loans to (1): |
||||||||||||||||||||
| Total loans |
0.97 | 0.94 | 0.91 | 0.77 | 0.57 | |||||||||||||||
| Non-accrual loans |
129.1 | 138.4 | 139.8 | 142.2 | 110.0 | |||||||||||||||
| Average stockholders’ equity to average total assets |
12.6 | 12.7 | 12.5 | 13.3 | 13.6 | |||||||||||||||
| Stockholders’ equity to total assets |
12.5 | 12.9 | 12.6 | 12.8 | 13.6 | |||||||||||||||
| Tangible common equity to tangible assets (4) |
7.5 | 7.5 | 7.3 | 7.4 | 8.0 | |||||||||||||||
| Total risk-based capital (2): |
||||||||||||||||||||
| People’s United Financial, Inc. |
12.4 | 11.8 | 11.8 | 11.3 | 12.0 | |||||||||||||||
| People’s United Bank, N.A. |
12.8 | 12.3 | 12.3 | 12.0 | 12.1 | |||||||||||||||
| (1) | Allowance for credit losses on loans and asset quality ratios for 2020 reflect the initial adoption and application of the CECL standard. |
| (2) | December 31, 2020 amounts and ratios are preliminary. |
| (3) | Average balances for securities are based on amortized cost. |
| (4) | See Non-GAAP Financial Measures and Reconciliation to GAAP beginning on page 16. |
8
People’s United Financial, Inc.
CONSOLIDATED STATEMENTS OF CONDITION (1)
| Dec. 31, | Sept. 30, | June 30, | Dec. 31, | |||||||||||||
| (in millions) |
2020 | 2020 | 2020 | 2019 | ||||||||||||
| Assets |
||||||||||||||||
| Cash and due from banks |
$ | 477.3 | $ | 616.8 | $ | 491.9 | $ | 484.2 | ||||||||
| Short-term investments |
3,766.0 | 438.6 | 987.4 | 316.8 | ||||||||||||
| Securities: |
||||||||||||||||
| Trading debt securities, at fair value |
— | — | — | 7.1 | ||||||||||||
| Equity securities, at fair value |
5.3 | 5.6 | 5.8 | 8.2 | ||||||||||||
| Debt securities available-for-sale, at fair value |
4,925.5 | 4,080.7 | 4,080.3 | 3,564.3 | ||||||||||||
| Debt securities held-to-maturity, at amortized cost |
3,993.8 | 3,916.5 | 3,848.6 | 3,869.2 | ||||||||||||
| Federal Home Loan Bank and Federal Reserve Bank stock, at cost |
266.6 | 267.1 | 298.3 | 341.1 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total securities |
9,191.2 | 8,269.9 | 8,233.0 | 7,789.9 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Loans held-for-sale |
26.5 | 21.4 | 12.2 | 511.3 | ||||||||||||
| Loans: |
||||||||||||||||
| Commercial and industrial (2) |
14,982.3 | 15,295.0 | 14,593.9 | 11,041.6 | ||||||||||||
| Commercial real estate (2) |
13,336.9 | 13,713.3 | 13,999.5 | 14,762.3 | ||||||||||||
| Equipment financing |
4,930.0 | 4,887.6 | 4,880.1 | 4,910.4 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total Commercial Portfolio |
33,249.2 | 33,895.9 | 33,473.5 | 30,714.3 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Residential mortgage |
8,518.9 | 9,095.6 | 9,623.7 | 10,318.1 | ||||||||||||
| Home equity and other consumer |
2,101.4 | 2,239.1 | 2,354.3 | 2,563.7 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total Retail Portfolio |
10,620.3 | 11,334.7 | 11,978.0 | 12,881.8 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total loans |
43,869.5 | 45,230.6 | 45,451.5 | 43,596.1 | ||||||||||||
| Less allowance for credit losses on loans |
(425.1 | ) | (423.8 | ) | (414.0 | ) | (246.6 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total loans, net |
43,444.4 | 44,806.8 | 45,037.5 | 43,349.5 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Goodwill and other acquisition-related intangible assets |
3,198.9 | 3,243.5 | 3,253.7 | 3,274.6 | ||||||||||||
| Bank-owned life insurance |
711.6 | 710.5 | 708.1 | 705.0 | ||||||||||||
| Premises and equipment, net |
276.7 | 281.3 | 285.7 | 305.5 | ||||||||||||
| Other assets |
2,352.2 | 2,482.4 | 2,500.2 | 1,853.0 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total assets |
$ | 63,444.8 | $ | 60,871.2 | $ | 61,509.7 | $ | 58,589.8 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Liabilities |
||||||||||||||||
| Deposits: |
||||||||||||||||
| Non-interest-bearing |
$ | 15,881.7 | $ | 14,101.9 | $ | 13,656.9 | $ | 9,803.7 | ||||||||
| Savings |
6,029.7 | 5,846.3 | 5,759.4 | 4,987.7 | ||||||||||||
| Interest-bearing checking and money market |
24,567.5 | 23,361.8 | 22,943.6 | 19,592.6 | ||||||||||||
| Time |
5,658.8 | 6,326.5 | 7,574.4 | 9,205.5 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total deposits |
52,137.7 | 49,636.5 | 49,934.3 | 43,589.5 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Borrowings: |
||||||||||||||||
| Federal Home Loan Bank advances |
569.7 | 579.8 | 1,289.7 | 3,125.4 | ||||||||||||
| Customer repurchase agreements |
452.9 | 432.5 | 342.1 | 409.1 | ||||||||||||
| Federal funds purchased |
125.0 | 225.0 | 150.0 | 1,620.0 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total borrowings |
1,147.6 | 1,237.3 | 1,781.8 | 5,154.5 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Notes and debentures |
1,009.6 | 1,012.0 | 1,014.5 | 993.1 | ||||||||||||
| Other liabilities |
1,194.1 | 1,153.9 | 1,016.1 | 905.5 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total liabilities |
55,489.0 | 53,039.7 | 53,746.7 | 50,642.6 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Stockholders’ Equity |
||||||||||||||||
| Preferred stock |
244.1 | 244.1 | 244.1 | 244.1 | ||||||||||||
| Common stock |
5.3 | 5.3 | 5.3 | 5.3 | ||||||||||||
| Additional paid-in capital |
7,663.6 | 7,657.3 | 7,651.2 | 7,639.4 | ||||||||||||
| Retained earnings |
1,716.6 | 1,589.1 | 1,524.6 | 1,512.8 | ||||||||||||
| Accumulated other comprehensive loss |
(89.2 | ) | (77.9 | ) | (73.9 | ) | (166.9 | ) | ||||||||
| Unallocated common stock of Employee Stock Ownership Plan, at cost |
(115.6 | ) | (117.4 | ) | (119.3 | ) | (122.9 | ) | ||||||||
| Treasury stock, at cost |
(1,469.0 | ) | (1,469.0 | ) | (1,469.0 | ) | (1,164.6 | ) | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total stockholders’ equity |
7,955.8 | 7,831.5 | 7,763.0 | 7,947.2 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total liabilities and stockholders’ equity |
$ | 63,444.8 | $ | 60,871.2 | $ | 61,509.7 | $ | 58,589.8 | ||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| (1) | The Consolidated Statement of Condition for December 31, 2020 is preliminary and does not reflect any estimated goodwill impairment that the Company is in the process of evaluating. |
| (2) | In connection with the United Bank core system conversion in April 2020, approximately $400 million of loans secured by owner-occupied commercial properties were prospectively reclassified, at that time, from commercial real estate loans to commercial and industrial loans. Prior period loan balances were not restated to conform to the current presentation. |
9
People’s United Financial, Inc.
CONSOLIDATED STATEMENTS OF INCOME (1)
| Three Months Ended | ||||||||||||||||||||
| Dec. 31, | Sept. 30, | June 30, | March 31, | Dec. 31, | ||||||||||||||||
| (in millions, except per common share data) |
2020 | 2020 | 2020 | 2020 | 2019 | |||||||||||||||
| Interest and dividend income: |
||||||||||||||||||||
| Commercial real estate (2) |
$ | 106.1 | $ | 110.5 | $ | 122.4 | $ | 149.6 | $ | 147.2 | ||||||||||
| Commercial and industrial (2) |
111.3 | 110.7 | 112.4 | 106.4 | 114.9 | |||||||||||||||
| Equipment financing |
62.1 | 65.4 | 67.6 | 68.2 | 66.7 | |||||||||||||||
| Residential mortgage |
74.9 | 82.1 | 84.8 | 90.4 | 88.2 | |||||||||||||||
| Home equity and other consumer |
18.7 | 19.9 | 20.1 | 28.0 | 30.8 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total interest on loans |
373.1 | 388.6 | 407.3 | 442.6 | 447.8 | |||||||||||||||
| Securities |
47.2 | 47.5 | 49.8 | 51.2 | 47.8 | |||||||||||||||
| Short-term investments |
0.8 | 0.4 | 0.2 | 2.0 | 1.0 | |||||||||||||||
| Loans held-for-sale |
0.4 | 0.3 | 0.3 | 3.3 | 0.3 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total interest and dividend income |
421.5 | 436.8 | 457.6 | 499.1 | 496.9 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Interest expense: |
||||||||||||||||||||
| Deposits |
30.1 | 36.5 | 41.7 | 78.9 | 86.9 | |||||||||||||||
| Borrowings |
1.3 | 1.5 | 2.0 | 15.4 | 18.5 | |||||||||||||||
| Notes and debentures |
7.3 | 7.4 | 8.3 | 8.8 | 8.8 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total interest expense |
38.7 | 45.4 | 52.0 | 103.1 | 114.2 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Net interest income |
382.8 | 391.4 | 405.6 | 396.0 | 382.7 | |||||||||||||||
| Provision for credit losses on loans (3) |
14.7 | 27.1 | 80.8 | 33.5 | 7.3 | |||||||||||||||
| Provision for credit losses on securities (3) |
— | (0.3 | ) | — | — | — | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Net interest income after provision for credit losses |
368.1 | 364.6 | 324.8 | 362.5 | 375.4 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Non-interest income: |
||||||||||||||||||||
| Bank service charges |
24.7 | 24.5 | 20.3 | 28.0 | 28.9 | |||||||||||||||
| Investment management fees |
18.9 | 18.8 | 17.4 | 18.1 | 19.3 | |||||||||||||||
| Commercial banking lending fees |
15.5 | 12.7 | 10.6 | 12.1 | 12.9 | |||||||||||||||
| Operating lease income |
12.9 | 12.4 | 11.8 | 12.6 | 12.7 | |||||||||||||||
| Insurance revenue |
4.1 | 9.7 | 9.0 | 10.9 | 7.5 | |||||||||||||||
| Cash management fees |
9.1 | 8.8 | 8.1 | 7.4 | 7.1 | |||||||||||||||
| Customer interest rate swap income, net |
2.2 | 1.2 | 2.7 | 8.8 | 8.5 | |||||||||||||||
| Gain on sale of business, net of expenses (4) |
75.9 | — | — | — | — | |||||||||||||||
| Other non-interest income (4) |
14.9 | 13.0 | 9.7 | 25.9 | 27.3 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total non-interest income |
178.2 | 101.1 | 89.6 | 123.8 | 124.2 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Non-interest expense: |
||||||||||||||||||||
| Compensation and benefits |
166.6 | 166.5 | 167.8 | 173.9 | 171.4 | |||||||||||||||
| Occupancy and equipment |
50.9 | 49.1 | 48.0 | 51.0 | 52.2 | |||||||||||||||
| Professional and outside services |
24.9 | 24.1 | 25.7 | 38.5 | 29.6 | |||||||||||||||
| Amortization of other acquisition-related intangible assets |
9.7 | 10.2 | 10.2 | 10.7 | 9.8 | |||||||||||||||
| Operating lease expense |
8.5 | 9.3 | 8.8 | 9.8 | 9.6 | |||||||||||||||
| Regulatory assessments |
6.9 | 8.4 | 8.7 | 8.7 | 7.3 | |||||||||||||||
| Other non-interest expense |
25.9 | 26.0 | 34.8 | 27.5 | 45.8 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total non-interest expense (4) |
293.4 | 293.6 | 304.0 | 320.1 | 325.7 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Income before income tax expense |
252.9 | 172.1 | 110.4 | 166.2 | 173.9 | |||||||||||||||
| Income tax expense |
45.2 | 27.5 | 20.5 | 35.8 | 36.4 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Net income |
207.7 | 144.6 | 89.9 | 130.4 | 137.5 | |||||||||||||||
| Preferred stock dividend |
3.5 | 3.5 | 3.5 | 3.5 | 3.5 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Net income available to common shareholders |
$ | 204.2 | $ | 141.1 | $ | 86.4 | $ | 126.9 | $ | 134.0 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Earnings per common share: |
||||||||||||||||||||
| Basic |
$ | 0.49 | $ | 0.34 | $ | 0.21 | $ | 0.30 | $ | 0.31 | ||||||||||
| Diluted |
0.49 | 0.34 | 0.21 | 0.30 | 0.31 | |||||||||||||||
| (1) | The Consolidated Statement of Income for December 31, 2020 is preliminary and does not reflect any estimated goodwill impairment that the Company is in the process of evaluating. |
| (2) | In connection with the United Bank core system conversion in April 2020, approximately $400 million of loans secured by owner-occupied commercial properties were prospectively reclassified, at that time, from commercial real estate loans to commercial and industrial loans. Prior period interest income amounts were not restated to conform to the current presentation. |
| (3) | Provision for credit losses in 2020 reflects the application of the CECL standard and the impact of COVID-19. |
| (4) | The gain on sale of business, net of expenses, is considered non-operating income. Other non-interest income includes $7.6 million of non-operating income for the three months ended December 31, 2019. Total non-interest expense includes $4.9 million, $4.6 million, $18.5 million, $17.9 million and $39.1 million of non-operating expenses for the three months ended December 31, 2020, September 30, 2020, June 30, 2020, March 31, 2020, and December 31, 2019, respectively. See Non-GAAP Financial Measures and Reconciliation to GAAP beginning on page 16. |
10
People’s United Financial, Inc.
CONSOLIDATED STATEMENTS OF INCOME (1)
| Twelve Months Ended December 31, |
||||||||
| (in millions, except per common share data) |
2020 | 2019 | ||||||
| Interest and dividend income: |
||||||||
| Commercial real estate |
$ | 488.6 | $ | 556.4 | ||||
| Commercial and industrial |
440.8 | 443.6 | ||||||
| Equipment financing |
263.3 | 253.8 | ||||||
| Residential mortgage |
332.2 | 329.1 | ||||||
| Home equity and other consumer |
86.7 | 106.1 | ||||||
|
|
|
|
|
|||||
| Total interest on loans |
1,611.6 | 1,689.0 | ||||||
| Securities |
195.7 | 186.5 | ||||||
| Loans held-for-sale |
4.3 | 0.8 | ||||||
| Short-term investments |
3.4 | 4.8 | ||||||
|
|
|
|
|
|||||
| Total interest and dividend income |
1,815.0 | 1,881.1 | ||||||
|
|
|
|
|
|||||
| Interest expense: |
||||||||
| Deposits |
187.2 | 356.9 | ||||||
| Borrowings |
20.2 | 77.0 | ||||||
| Notes and debentures |
31.8 | 34.9 | ||||||
|
|
|
|
|
|||||
| Total interest expense |
239.2 | 468.8 | ||||||
|
|
|
|
|
|||||
| Net interest income |
1,575.8 | 1,412.3 | ||||||
| Provision for credit losses on loans (2) |
156.1 | 28.3 | ||||||
| Provision for credit losses on securities (2) |
(0.3 | ) | — | |||||
|
|
|
|
|
|||||
| Net interest income after provision for credit losses |
1,420.0 | 1,384.0 | ||||||
|
|
|
|
|
|||||
| Non-interest income: |
||||||||
| Bank service charges |
97.5 | 107.5 | ||||||
| Investment management fees |
73.2 | 78.2 | ||||||
| Commercial banking lending fees |
50.9 | 42.7 | ||||||
| Operating lease income |
49.7 | 50.8 | ||||||
| Insurance revenue |
33.7 | 37.0 | ||||||
| Cash management fees |
33.4 | 28.4 | ||||||
| Customer interest rate swap income, net |
14.9 | 24.0 | ||||||
| Gain on sale of business, net of expenses (3) |
75.9 | — | ||||||
| Other non-interest income (3) |
63.5 | 62.5 | ||||||
|
|
|
|
|
|||||
| Total non-interest income |
492.7 | 431.1 | ||||||
|
|
|
|
|
|||||
| Non-interest expense: |
||||||||
| Compensation and benefits |
674.8 | 646.2 | ||||||
| Occupancy and equipment |
199.0 | 185.9 | ||||||
| Professional and outside services |
113.2 | 98.2 | ||||||
| Amortization of other acquisition-related intangible assets |
40.8 | 32.5 | ||||||
| Operating lease expense |
36.4 | 38.8 | ||||||
| Regulatory assessments |
32.7 | 26.1 | ||||||
| Other non-interest expense |
114.2 | 135.0 | ||||||
|
|
|
|
|
|||||
| Total non-interest expense (3) |
1,211.1 | 1,162.7 | ||||||
|
|
|
|
|
|||||
| Income before income tax expense |
701.6 | 652.4 | ||||||
| Income tax expense |
129.0 | 132.0 | ||||||
|
|
|
|
|
|||||
| Net income |
572.6 | 520.4 | ||||||
| Preferred stock dividend |
14.1 | 14.1 | ||||||
|
|
|
|
|
|||||
| Net income available to common shareholders |
$ | 558.5 | $ | 506.3 | ||||
|
|
|
|
|
|||||
| Earnings per common share: |
||||||||
| Basic |
$ | 1.33 | $ | 1.28 | ||||
| Diluted |
1.32 | 1.27 | ||||||
| (1) | The Consolidated Statement of Income for December 31, 2020 is preliminary and does not reflect any estimated goodwill impairment that the Company is in the process of evaluating. |
| (2) | Provision for credit losses in 2020 reflects the application of the CECL standard and the impact of COVID-19. |
| (3) | The gain on sale of business, net of expenses, is considered non-operating income. Other non-interest income includes $7.6 million of non-operating income for the twelve months ended December 31, 2019. Total non-interest expense includes $45.9 million and $65.6 million of non-operating expenses for the twelve months ended December 31, 2020 and 2019, respectively. See Non-GAAP Financial Measures and Reconciliation to GAAP beginning on page 16. |
11
People’s United Financial, Inc.
AVERAGE BALANCE SHEET, INTEREST AND YIELD/RATE ANALYSIS (1)
| December 31, 2020 | September 30, 2020 | December 31, 2019 | ||||||||||||||||||||||||||||||||||
| Three months ended (dollars in millions) |
Average Balance |
Interest | Yield/ Rate |
Average Balance |
Interest | Yield/ Rate |
Average Balance |
Interest | Yield/ Rate |
|||||||||||||||||||||||||||
| Assets: |
||||||||||||||||||||||||||||||||||||
| Short-term investments |
$ | 2,582.1 | $ | 0.8 | 0.12 | % | $ | 841.5 | $ | 0.4 | 0.19 | % | $ | 294.4 | $ | 1.0 | 1.39 | % | ||||||||||||||||||
| Securities (2) |
8,390.2 | 52.3 | 2.50 | 7,922.4 | 52.5 | 2.65 | 7,372.2 | 52.6 | 2.85 | |||||||||||||||||||||||||||
| Loans: |
||||||||||||||||||||||||||||||||||||
| Commercial real estate |
13,574.3 | 106.1 | 3.13 | 13,853.1 | 110.5 | 3.19 | 13,793.2 | 147.2 | 4.27 | |||||||||||||||||||||||||||
| Commercial and industrial |
14,621.8 | 113.6 | 3.11 | 14,419.8 | 113.0 | 3.13 | 10,805.1 | 117.7 | 4.36 | |||||||||||||||||||||||||||
| Equipment financing |
4,867.5 | 62.1 | 5.10 | 4,876.4 | 65.4 | 5.37 | 4,785.0 | 66.7 | 5.58 | |||||||||||||||||||||||||||
| Residential mortgage |
8,821.0 | 75.3 | 3.41 | 9,408.0 | 82.4 | 3.51 | 10,019.0 | 88.5 | 3.53 | |||||||||||||||||||||||||||
| Home equity and other consumer |
2,176.6 | 18.7 | 3.44 | 2,296.0 | 19.9 | 3.47 | 2,603.8 | 30.8 | 4.72 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
| Total loans |
44,061.2 | 375.8 | 3.41 | 44,853.3 | 391.2 | 3.49 | 42,006.1 | 450.9 | 4.29 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
| Total earning assets |
55,033.5 | $ | 428.9 | 3.12 | % | 53,617.2 | $ | 444.1 | 3.31 | % | 49,672.7 | $ | 504.5 | 4.06 | % | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
| Other assets |
7,362.6 | 7,676.2 | 6,457.2 | |||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
| Total assets |
$ | 62,396.1 | $ | 61,293.4 | $ | 56,129.9 | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
| Liabilities and stockholders’ equity: |
||||||||||||||||||||||||||||||||||||
| Deposits: |
||||||||||||||||||||||||||||||||||||
| Non-interest-bearing |
$ | 14,742.6 | $ | — | — | % | $ | 13,753.8 | $ | — | — | % | $ | 9,593.6 | $ | — | — | % | ||||||||||||||||||
| Savings, interest-bearing checking and money market |
29,978.3 | 14.7 | 0.20 | 28,970.0 | 16.4 | 0.23 | 23,674.3 | 49.7 | 0.84 | |||||||||||||||||||||||||||
| Time |
5,953.5 | 15.4 | 1.03 | 6,817.8 | 20.1 | 1.18 | 8,926.8 | 37.2 | 1.67 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
| Total deposits |
50,674.4 | 30.1 | 0.24 | 49,541.6 | 36.5 | 0.29 | 42,194.7 | 86.9 | 0.82 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
| Borrowings: |
||||||||||||||||||||||||||||||||||||
| Federal Home Loan Bank advances |
571.8 | 1.1 | 0.77 | 640.5 | 1.3 | 0.79 | 2,287.7 | 11.4 | 1.99 | |||||||||||||||||||||||||||
| Customer repurchase agreements |
447.6 | 0.2 | 0.15 | 382.6 | 0.2 | 0.18 | 1,489.3 | 6.4 | 1.73 | |||||||||||||||||||||||||||
| Federal funds purchased |
213.3 | — | 0.09 | 260.1 | — | 0.08 | 369.2 | 0.7 | 0.73 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
| Total borrowings |
1,232.7 | 1.3 | 0.43 | 1,283.2 | 1.5 | 0.46 | 4,146.2 | 18.5 | 1.78 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
| Notes and debentures |
1,010.8 | 7.3 | 2.89 | 1,014.0 | 7.4 | 2.92 | 973.5 | 8.8 | 3.61 | |||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||
| Total funding liabilities |
52,917.9 | $ | 38.7 | 0.29 | % | 51,838.8 | $ | 45.4 | 0.35 | % | 47,314.4 | $ | 114.2 | 0.96 | % | |||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
| Other liabilities |
1,594.2 | 1,653.3 | 1,161.3 | |||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
| Total liabilities |
54,512.1 | 53,492.1 | 48,475.7 | |||||||||||||||||||||||||||||||||
| Stockholders’ equity |
7,884.0 | 7,801.3 | 7,654.2 | |||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
| Total liabilities and stockholders’ equity |
$ | 62,396.1 | $ | 61,293.4 | $ | 56,129.9 | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
| Net interest income/spread (3) |
$ | 390.2 | 2.83 | % | $ | 398.7 | 2.96 | % | $ | 390.3 | 3.10 | % | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||||||||||
| Net interest margin |
2.84 | % | 2.97 | % | 3.14 | % | ||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|||||||||||||||||||||||||||||||
| (1) | Average yields earned and rates paid are annualized. |
| (2) | Average balances and yields for securities are based on amortized cost. |
| (3) | The fully taxable equivalent adjustment was $7.4 million, $7.3 million and $7.6 million for the three months ended December 31, 2020, September 30, 2020 and December 31, 2019, respectively. |
12
People’s United Financial, Inc.
AVERAGE BALANCE SHEET, INTEREST AND YIELD/RATE ANALYSIS
| December 31, 2020 | December 31, 2019 | |||||||||||||||||||||||
| Twelve months ended (dollars in millions) |
Average Balance |
Interest | Yield/ Rate |
Average Balance |
Interest | Yield/ Rate |
||||||||||||||||||
| Assets: |
||||||||||||||||||||||||
| Short-term investments |
$ | 1,125.1 | $ | 3.4 | 0.31 | % | $ | 232.7 | $ | 4.8 | 2.06 | % | ||||||||||||
| Securities (1) |
8,143.7 | 215.7 | 2.65 | 7,217.5 | 205.2 | 2.84 | ||||||||||||||||||
| Loans: |
||||||||||||||||||||||||
| Commercial real estate |
14,057.6 | 488.6 | 3.48 | 12,480.1 | 556.4 | 4.46 | ||||||||||||||||||
| Commercial and industrial |
13,456.8 | 451.0 | 3.35 | 9,874.7 | 454.3 | 4.60 | ||||||||||||||||||
| Equipment financing |
4,898.2 | 263.3 | 5.38 | 4,574.9 | 253.8 | 5.55 | ||||||||||||||||||
| Residential mortgage |
9,569.2 | 333.3 | 3.48 | 9,314.8 | 329.9 | 3.54 | ||||||||||||||||||
| Home equity and other consumer |
2,400.5 | 89.5 | 3.73 | 2,174.0 | 106.1 | 4.88 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total loans |
44,382.3 | 1,625.7 | 3.66 | 38,418.5 | 1,700.5 | 4.43 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total earning assets |
53,651.1 | $ | 1,844.8 | 3.44 | % | 45,868.7 | $ | 1,910.5 | 4.17 | % | ||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Other assets |
7,387.0 | 5,789.3 | ||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
| Total assets |
$ | 61,038.1 | $ | 51,658.0 | ||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
| Liabilities and stockholders’ equity: |
||||||||||||||||||||||||
| Deposits: |
||||||||||||||||||||||||
| Non-interest-bearing |
$ | 12,864.4 | $ | — | — | % | $ | 8,822.9 | $ | — | — | % | ||||||||||||
| Savings, interest-bearing checking and money market |
27,831.9 | 92.2 | 0.33 | 22,204.1 | 209.3 | 0.94 | ||||||||||||||||||
| Time |
7,520.6 | 95.0 | 1.26 | 8,115.7 | 147.6 | 1.82 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total deposits |
48,216.9 | 187.2 | 0.39 | 39,142.7 | 356.9 | 0.91 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Borrowings: |
||||||||||||||||||||||||
| Federal Home Loan Bank advances |
1,371.2 | 13.7 | 1.00 | 2,098.0 | 50.1 | 2.39 | ||||||||||||||||||
| Federal funds purchased |
688.2 | 5.4 | 0.79 | 1,127.5 | 24.6 | 2.18 | ||||||||||||||||||
| Customer repurchase agreements |
379.0 | 1.1 | 0.29 | 296.6 | 2.2 | 0.75 | ||||||||||||||||||
| Other borrowings |
— | — | — | 3.3 | 0.1 | 1.87 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total borrowings |
2,438.4 | 20.2 | 0.83 | 3,525.4 | 77.0 | 2.18 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Notes and debentures |
1,009.5 | 31.8 | 3.15 | 922.1 | 34.9 | 3.78 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
| Total funding liabilities |
51,664.8 | $ | 239.2 | 0.46 | % | 43,590.2 | $ | 468.8 | 1.08 | % | ||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Other liabilities |
1,561.5 | 996.5 | ||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
| Total liabilities |
53,226.3 | 44,586.7 | ||||||||||||||||||||||
| Stockholders’ equity |
7,811.8 | 7,071.3 | ||||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
| Total liabilities and stockholders’ equity |
$ | 61,038.1 | $ | 51,658.0 | ||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
| Net interest income/spread (2) |
$ | 1,605.6 | 2.98 | % | $ | 1,441.7 | 3.09 | % | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||||||||||
| Net interest margin |
2.99 | % | 3.14 | % | ||||||||||||||||||||
|
|
|
|
|
|||||||||||||||||||||
| (1) | Average balances and yields for securities are based on amortized cost. |
| (2) | The fully taxable equivalent adjustment was $29.8 million and $29.4 million for the twelve months ended December 31, 2020 and 2019, respectively. |
13
People’s United Financial, Inc.
As a result of adopting the CECL standard on January 1, 2020, People’s United’s prior distinction between the originated loan portfolio and the acquired loan portfolio is no longer necessary. Accordingly, prior period disclosures have been revised to conform to the current period presentation.
NON-PERFORMING ASSETS
| (dollars in millions) |
Dec. 31, 2020 |
Sept. 30, 2020 |
June 30, 2020 |
March 31, 2020 |
Dec. 31, 2019 |
|||||||||||||||
| Non-accrual loans: |
||||||||||||||||||||
| Commercial: |
||||||||||||||||||||
| Commercial real estate |
$ | 60.4 | $ | 85.3 | $ | 73.6 | $ | 53.5 | $ | 53.8 | ||||||||||
| Commercial and industrial |
76.4 | 86.7 | 88.8 | 55.6 | 38.5 | |||||||||||||||
| Equipment financing |
109.3 | 49.0 | 48.6 | 42.5 | 47.7 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total Commercial |
246.1 | 221.0 | 211.0 | 151.6 | 140.0 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Retail: |
||||||||||||||||||||
| Residential mortgage |
62.3 | 62.9 | 62.6 | 66.6 | 63.3 | |||||||||||||||
| Home equity |
20.5 | 22.1 | 22.5 | 22.1 | 20.8 | |||||||||||||||
| Other consumer |
0.2 | 0.2 | 0.1 | 0.1 | — | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total Retail |
83.0 | 85.2 | 85.2 | 88.8 | 84.1 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total non-accrual loans (1) |
329.1 | 306.2 | 296.2 | 240.4 | 224.1 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Real estate owned: |
||||||||||||||||||||
| Commercial |
3.6 | 3.6 | 7.3 | 7.3 | 7.3 | |||||||||||||||
| Residential |
3.2 | 1.9 | 4.9 | 9.5 | 11.9 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total real estate owned |
6.8 | 5.5 | 12.2 | 9.5 | 11.9 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Repossessed assets |
5.7 | 9.7 | 6.2 | 4.6 | 4.2 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total non-performing assets |
$ | 341.6 | $ | 321.4 | $ | 314.6 | $ | 254.5 | $ | 240.2 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Non-accrual loans as a percentage of total loans |
0.75 | % | 0.68 | % | 0.65 | % | 0.54 | % | 0.51 | % | ||||||||||
| Non-performing assets as a percentage of: |
||||||||||||||||||||
| Total loans, real estate owned and repossessed assets |
0.78 | 0.71 | 0.69 | 0.59 | 0.57 | |||||||||||||||
| Tangible stockholders’ equity and allowance for credit losses |
6.59 | 6.41 | 6.39 | 5.45 | 5.03 | |||||||||||||||
| (1) | Reported net of government guarantees totaling $2.5 million at December 31, 2020, $2.4 million at September 30, 2020, $2.9 million at June 30, 2020, $1.2 million at March 31, 2020 and $1.3 million at December 31, 2019. |
14
People’s United Financial, Inc.
PROVISION AND ALLOWANCE FOR CREDIT LOSSES ON LOANS
| Three Months Ended | ||||||||||||||||||||
| (dollars in millions) |
Dec. 31, 2020 |
Sept 30, 2020 |
June 30, 2020 |
March 31, 2020 |
Dec. 31, 2019 |
|||||||||||||||
| Allowance for credit losses on loans: |
||||||||||||||||||||
| Balance at beginning of period |
$ | 423.8 | $ | 414.0 | $ | 341.7 | $ | 246.6 | $ | 246.0 | ||||||||||
| CECL transition adjustment |
— | — | — | 72.2 | N/A | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Balance at beginning of period, adjusted |
423.8 | 414.0 | 341.7 | 318.8 | 246.0 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Charge-offs |
(16.7 | ) | (19.3 | ) | (10.3 | ) | (12.6 | ) | (8.5 | ) | ||||||||||
| Recoveries |
3.3 | 2.0 | 1.8 | 2.0 | 1.8 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Net loan charge-offs |
(13.4 | ) | (17.3 | ) | (8.5 | ) | (10.6 | ) | (6.7 | ) | ||||||||||
| Provision for credit losses on loans |
14.7 | 27.1 | 80.8 | 33.5 | 7.3 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Balance at end of period |
$ | 425.1 | $ | 423.8 | $ | 414.0 | $ | 341.7 | $ | 246.6 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Allowance for credit losses on loans as a percentage of: |
||||||||||||||||||||
| Total loans |
0.97 | % | 0.94 | % | 0.91 | % | 0.77 | % | 0.57 | % | ||||||||||
| Non-accrual loans |
129.1 | 138.4 | 139.8 | 142.2 | 110.0 | |||||||||||||||
N/A - not applicable
NET LOAN CHARGE-OFFS (RECOVERIES)
| Three Months Ended | ||||||||||||||||||||
| (dollars in millions) |
Dec. 31, 2020 |
Sept. 30, 2020 |
June 30, 2020 |
March 31, 2020 |
Dec. 31, 2019 |
|||||||||||||||
| Commercial: |
||||||||||||||||||||
| Commercial real estate |
$ | 0.1 | $ | 4.1 | $ | 1.8 | $ | 3.4 | $ | (0.1 | ) | |||||||||
| Commercial and industrial |
6.6 | 6.9 | — | 1.0 | 2.3 | |||||||||||||||
| Equipment financing |
6.8 | 6.2 | 5.2 | 3.9 | 4.2 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total |
13.5 | 17.2 | 7.0 | 8.3 | 6.4 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Retail: |
||||||||||||||||||||
| Residential mortgage |
(0.3 | ) | (0.2 | ) | — | 0.8 | (0.2 | ) | ||||||||||||
| Home equity |
— | — | 0.6 | 0.1 | 0.3 | |||||||||||||||
| Other consumer |
0.2 | 0.3 | 0.9 | 1.4 | 0.2 | |||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total |
(0.1 | ) | 0.1 | 1.5 | 2.3 | 0.3 | ||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Total net loan charge-offs |
$ | 13.4 | $ | 17.3 | $ | 8.5 | $ | 10.6 | $ | 6.7 | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
| Net loan charge-offs to average total loans (annualized) |
0.12 | % | 0.15 | % | 0.08 | % | 0.10 | % | 0.06 | % | ||||||||||
15
People’s United Financial, Inc.
NON-GAAP FINANCIAL MEASURES AND RECONCILIATION TO GAAP
In addition to evaluating People’s United Financial Inc. (“People’s United”) results of operations in accordance with U.S. generally accepted accounting principles (“GAAP”), management routinely supplements its evaluation with an analysis of certain non-GAAP financial measures, such as the efficiency and tangible common equity ratios, tangible book value per common share and operating earnings metrics. Management believes these non-GAAP financial measures provide information useful to investors in understanding People’s United’s underlying operating performance and trends, and facilitates comparisons with the performance of other financial institutions. Further, the efficiency ratio and operating earnings metrics are used by management in its assessment of financial performance, including non-interest expense control, while the tangible common equity ratio and tangible book value per common share are used to analyze the relative strength of People’s United’s capital position.
The efficiency ratio, which represents an approximate measure of the cost required by People’s United to generate a dollar of revenue, is the ratio of (i) total non-interest expense (excluding operating lease expense, goodwill impairment charges, amortization of other acquisition-related intangible assets, losses on real estate assets and non-recurring expenses) (the numerator) to (ii) net interest income on a fully taxable equivalent (“FTE”) basis plus total non-interest income (including the FTE adjustment on bank-owned life insurance (“BOLI”) income, the netting of operating lease expense and excluding gains and losses on sales of assets other than residential mortgage loans and acquired loans, and non-recurring income) (the denominator). People’s United generally considers an item of income or expense to be non-recurring if it is not similar to an item of income or expense of a type incurred within the last two years and is not similar to an item of income or expense of a type reasonably expected to be incurred within the following two years.
Operating earnings exclude from net income available to common shareholders those items that management considers to be of such a non-recurring or infrequent nature that, by excluding such items (net of income taxes), People’s United’s results can be measured and assessed on a more consistent basis from period to period. Items excluded from operating earnings, which include, but are not limited to: (i) non-recurring gains/losses; (ii) merger-related expenses, including acquisition integration and other costs; (iii) writedowns of banking house assets and related lease termination costs; (iv) severance-related costs; and (v) charges related to executive-level management separation costs, are generally also excluded when calculating the efficiency ratio. Operating earnings per common share (“EPS”) is derived by determining the per common share impact of the respective adjustments to arrive at operating earnings and adding (subtracting) such amounts to (from) diluted EPS, as reported. Operating return on average assets is calculated by dividing operating earnings (annualized) by average total assets. Operating return on average tangible common equity is calculated by dividing operating earnings (annualized) by average tangible common equity. The operating common dividend payout ratio is calculated by dividing common dividends paid by operating earnings for the respective period.
Pre-provision net revenue is a useful financial measure as it enables an assessment of the Company’s ability to generate earnings to cover credit losses through a credit cycle as well as providing an additional basis for comparing the Company’s results of operation between periods by isolating the impact of the provision for credit losses, which can vary significantly between periods.
The tangible common equity ratio is the ratio of (i) tangible common equity (total stockholders’ equity less preferred stock, goodwill and other acquisition-related intangible assets) (the numerator) to (ii) tangible assets (total assets less goodwill and other acquisition-related intangible assets) (the denominator). Tangible book value per common share is calculated by dividing tangible common equity by common shares (total common shares issued, less common shares classified as treasury shares and unallocated Employee Stock Ownership Plan (“ESOP”) common shares).
In light of diversity in presentation among financial institutions, the methodologies used by People’s United for determining the non-GAAP financial measures discussed above may differ from those used by other financial institutions.
16
People’s United Financial, Inc.
NON-GAAP FINANCIAL MEASURES AND RECONCILIATION TO GAAP - Continued
OPERATING NON-INTEREST EXPENSE AND EFFICIENCY RATIO
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||||||
| (dollars in millions) |
Dec. 31, 2020 |
Sept. 30, 2020 |
June 30, 2020 |
March 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2020 |
Dec. 31, 2019 |
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| Total non-interest expense |
$ | 293.4 | $ | 293.6 | $ | 304.0 | $ | 320.1 | $ | 325.7 | $ | 1,211.1 | $ | 1,162.7 | ||||||||||||||
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| Adjustments to arrive at operating non-interest expense: |
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| Merger-related expenses |
(4.9 | ) | (4.6 | ) | (18.5 | ) | (17.9 | ) | (22.6 | ) | (45.9 | ) | (49.1 | ) | ||||||||||||||
| Intangible asset write-down |
— | — | — | — | (16.5 | ) | — | (16.5 | ) | |||||||||||||||||||
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| Total |
(4.9 | ) | (4.6 | ) | (18.5 | ) | (17.9 | ) | (39.1 | ) | (45.9 | ) | (65.6 | ) | ||||||||||||||
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| Operating non-interest expense |
288.5 | 289.0 | 285.5 | 302.2 | 286.6 | 1,165.2 | 1,097.1 | |||||||||||||||||||||
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| Adjustments: |
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| Amortization of other acquisition-related intangible assets |
(9.7 | ) | (10.2 | ) | (10.2 | ) | (10.7 | ) | (9.8 | ) | (40.8 | ) | (32.5 | ) | ||||||||||||||
| Operating lease expense |
(8.5 | ) | (9.3 | ) | (8.8 | ) | (9.8 | ) | (9.6 | ) | (36.4 | ) | (38.8 | ) | ||||||||||||||
| Other (1) |
(1.3 | ) | (5.1 | ) | (1.9 | ) | (1.9 | ) | (1.6 | ) | (10.2 | ) | (6.2 | ) | ||||||||||||||
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| Total non-interest expense for efficiency ratio |
$ | 269.0 | $ | 264.4 | $ | 264.6 | $ | 279.8 | $ | 265.6 | $ | 1,077.8 | $ | 1,019.6 | ||||||||||||||
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| Net interest income (FTE basis) |
$ | 390.2 | $ | 398.7 | $ | 413.0 | $ | 403.7 | $ | 390.3 | $ | 1,605.6 | $ | 1,441.7 | ||||||||||||||
| Total non-interest income |
178.2 | 101.1 | 89.6 | 123.8 | 124.2 | 492.7 | 431.1 | |||||||||||||||||||||
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| Total revenues |
568.4 | 499.8 | 502.6 | 527.5 | 514.5 | 2,098.3 | 1,872.8 | |||||||||||||||||||||
| Adjustments: |
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| Gain on sale of business, net of expenses |
(75.9 | ) | — | — | — | — | (75.9 | ) | — | |||||||||||||||||||
| Operating lease expense |
(8.5 | ) | (9.3 | ) | (8.8 | ) | (9.8 | ) | (9.6 | ) | (36.4 | ) | (38.8 | ) | ||||||||||||||
| BOLI FTE adjustment |
0.9 | 0.8 | 1.0 | 0.8 | 0.7 | 3.5 | 2.5 | |||||||||||||||||||||
| Gain on sale of branches, net of expenses |
— | — | — | — | (7.6 | ) | — | (7.6 | ) | |||||||||||||||||||
| Net security gains |
— | — | — | — | (0.1 | ) | — | (0.2 | ) | |||||||||||||||||||
| Other (2) |
— | (0.1 | ) | — | (0.3 | ) | (3.2 | ) | (0.4 | ) | (2.8 | ) | ||||||||||||||||
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| Total revenues for efficiency ratio |
$ | 484.9 | $ | 491.2 | $ | 494.8 | $ | 518.2 | $ | 494.7 | $ | 1,989.1 | $ | 1,825.9 | ||||||||||||||
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| Efficiency ratio |
55.5 | % | 53.8 | % | 53.5 | % | 54.0 | % | 53.7 | % | 54.2 | % | 55.8 | % | ||||||||||||||
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| (1) | Items classified as “other” and deducted from non-interest expense for purposes of calculating the efficiency ratio include certain franchise taxes and real estate owned expenses. |
| (2) | Items classified as “other” and deducted from total revenues for purposes of calculating the efficiency ratio include, as applicable, asset write-offs and gains/losses associated with the sale of branch locations. |
PRE-PROVISION NET REVENUE
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||||||
| (in millions) |
Dec. 31, 2020 |
Sept. 30, 2020 |
June 30, 2020 |
March 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2020 |
Dec. 31, 2019 |
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| Net interest income |
$ | 382.8 | $ | 391.4 | $ | 405.6 | $ | 396.0 | $ | 382.7 | $ | 1,575.8 | $ | 1,412.3 | ||||||||||||||
| Non-interest income |
178.2 | 101.1 | 89.6 | 123.8 | 124.2 | 492.7 | 431.1 | |||||||||||||||||||||
| Non-interest expense |
(293.4 | ) | (293.6 | ) | (304.0 | ) | (320.1 | ) | (325.7 | ) | (1,211.1 | ) | (1,162.7 | ) | ||||||||||||||
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| Pre-provision net revenue |
267.6 | 198.9 | 191.2 | 199.7 | 181.2 | 857.4 | 680.7 | |||||||||||||||||||||
| Non-operating income |
(75.9 | ) | — | — | — | (7.6 | ) | (75.9 | ) | (7.6 | ) | |||||||||||||||||
| Non-operating expense |
4.9 | 4.6 | 18.5 | 17.9 | 39.1 | 45.9 | 65.6 | |||||||||||||||||||||
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| Operating pre-provision net revenue |
$ | 196.6 | $ | 203.5 | $ | 209.7 | $ | 217.6 | $ | 212.7 | $ | 827.4 | $ | 738.7 | ||||||||||||||
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17
People’s United Financial, Inc.
NON-GAAP FINANCIAL MEASURES AND RECONCILIATION TO GAAP - Continued
OPERATING EARNINGS
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||||||
| (dollars in millions, except per common share data) |
Dec. 31, 2020 |
Sept. 30, 2020 |
June 30, 2020 |
March 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2020 (1) |
Dec. 31, 2019 |
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| Net income available to common shareholders |
$ | 204.2 | $ | 141.1 | $ | 86.4 | $ | 126.9 | $ | 134.0 | $ | 558.5 | $ | 506.3 | ||||||||||||||
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| Adjustments to arrive at operating earnings: |
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| Merger-related expenses |
4.9 | 4.6 | 18.5 | 17.9 | 22.6 | 45.9 | 49.1 | |||||||||||||||||||||
| Gain on sale of business, net of expenses |
(75.9 | ) | — | — | — | — | (75.9 | ) | — | |||||||||||||||||||
| Intangible asset write-down |
— | — | — | — | 16.5 | — | 16.5 | |||||||||||||||||||||
| Gain on sale of branches, net of expenses |
— | — | — | — | (7.6 | ) | — | (7.6 | ) | |||||||||||||||||||
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| Total pre-tax adjustments |
(71.0 | ) | 4.6 | 18.5 | 17.9 | 31.5 | (30.0 | ) | 58.0 | |||||||||||||||||||
| Tax effect |
14.5 | (1.0 | ) | (3.9 | ) | (3.7 | ) | (6.7 | ) | 6.1 | (12.2 | ) | ||||||||||||||||
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| Total adjustments, net of tax |
(56.5 | ) | 3.6 | 14.6 | 14.2 | 24.8 | (23.9 | ) | 45.8 | |||||||||||||||||||
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| Operating earnings |
$ | 147.7 | $ | 144.7 | $ | 101.0 | $ | 141.1 | $ | 158.8 | $ | 534.6 | $ | 552.1 | ||||||||||||||
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| Diluted EPS, as reported |
$ | 0.49 | $ | 0.34 | $ | 0.21 | $ | 0.30 | $ | 0.31 | $ | 1.32 | $ | 1.27 | ||||||||||||||
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| Adjustments to arrive at operating EPS: |
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| Merger-related expenses |
— | — | 0.03 | 0.03 | 0.04 | 0.09 | 0.10 | |||||||||||||||||||||
| Gain on sale of business, net of expenses |
(0.14 | ) | — | — | — | — | (0.14 | ) | — | |||||||||||||||||||
| Intangible asset write-down |
— | — | — | — | 0.03 | — | 0.03 | |||||||||||||||||||||
| Gain on sale of branches, net of expenses |
— | — | — | — | (0.01 | ) | — | (0.01 | ) | |||||||||||||||||||
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| Total adjustments per common share |
(0.14 | ) | — | 0.03 | 0.03 | 0.06 | (0.05 | ) | 0.12 | |||||||||||||||||||
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| Operating EPS |
$ | 0.35 | $ | 0.34 | $ | 0.24 | $ | 0.33 | $ | 0.37 | $ | 1.27 | $ | 1.39 | ||||||||||||||
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| Average total assets |
$ | 62,396 | $ | 61,293 | $ | 61,841 | $ | 58,603 | $ | 56,130 | $ | 61,038 | $ | 51,658 | ||||||||||||||
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| Operating return on average assets (annualized) |
0.95 | % | 0.94 | % | 0.65 | % | 0.96 | % | 1.13 | % | 0.88 | % | 1.07 | % | ||||||||||||||
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| (1) | The sum of the quarterly amounts for certain line items may not equal twelve months amounts due to rounding. |
OPERATING RETURN ON AVERAGE TANGIBLE COMMON EQUITY
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||||||
| (dollars in millions) |
Dec. 31, 2020 |
Sept. 30, 2020 |
June 30, 2020 |
March 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2020 |
Dec. 31, 2019 |
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| Operating earnings |
$ | 147.7 | $ | 144.7 | $ | 101.0 | $ | 141.1 | $ | 158.8 | $ | 534.6 | $ | 552.1 | ||||||||||||||
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| Average stockholders’ equity |
$ | 7,884 | $ | 7,801 | $ | 7,757 | $ | 7,804 | $ | 7,654 | $ | 7,812 | $ | 7,071 | ||||||||||||||
| Less: Average preferred stock |
244 | 244 | 244 | 244 | 244 | 244 | 244 | |||||||||||||||||||||
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| Average common equity |
7,640 | 7,557 | 7,513 | 7,560 | 7,410 | 7,568 | 6,827 | |||||||||||||||||||||
| Less: Average goodwill and average other acquisition-related intangible assets |
3,213 | 3,249 | 3,259 | 3,269 | 3,226 | 3,247 | 3,060 | |||||||||||||||||||||
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| Average tangible common equity |
$ | 4,427 | $ | 4,308 | $ | 4,254 | $ | 4,291 | $ | 4,184 | $ | 4,321 | $ | 3,767 | ||||||||||||||
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| Operating return on average tangible common equity (annualized) |
13.3 | % | 13.4 | % | 9.5 | % | 13.2 | % | 15.2 | % | 12.4 | % | 14.7 | % | ||||||||||||||
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18
People’s United Financial, Inc.
NON-GAAP FINANCIAL MEASURES AND RECONCILIATION TO GAAP - Continued
OPERATING COMMON DIVIDEND PAYOUT RATIO
| Three Months Ended | Twelve Months Ended | |||||||||||||||||||||||||||
| (dollars in millions) |
Dec. 31, 2020 |
Sept. 30, 2020 |
June 30, 2020 |
March 31, 2020 |
Dec. 31, 2019 |
Dec. 31, 2020 (1) |
Dec. 31, 2019 |
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| Common dividends paid |
$ | 75.6 | $ | 75.7 | $ | 75.5 | $ | 77.3 | $ | 69.9 | $ | 304.1 | $ | 274.8 | ||||||||||||||
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| Operating earnings |
$ | 147.7 | $ | 144.7 | $ | 101.0 | $ | 141.1 | $ | 158.8 | $ | 534.6 | $ | 552.1 | ||||||||||||||
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| Operating common dividend payout ratio |
51.2 | % | 52.3 | % | 74.8 | % | 54.8 | % | 44.0 | % | 56.9 | % | 49.8 | % | ||||||||||||||
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| (1) | The sum of the quarterly amounts for certain line items may not equal twelve months amounts due to rounding. |
TANGIBLE COMMON EQUITY RATIO
| (dollars in millions) |
Dec. 31, 2020 |
Sept. 30, 2020 |
June 30, 2020 |
March 31, 2020 |
Dec. 31, 2019 |
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| Total stockholders’ equity |
$ | 7,956 | $ | 7,831 | $ | 7,763 | $ | 7,726 | $ | 7,947 | ||||||||||
| Less: Preferred stock |
244 | 244 | 244 | 244 | 244 | |||||||||||||||
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| Common equity |
7,712 | 7,587 | 7,519 | 7,482 | 7,703 | |||||||||||||||
| Less: Goodwill and other acquisition-related intangible assets |
3,199 | 3,244 | 3,254 | 3,264 | 3,275 | |||||||||||||||
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| Tangible common equity |
$ | 4,513 | $ | 4,343 | $ | 4,265 | $ | 4,218 | $ | 4,428 | ||||||||||
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| Total assets |
$ | 63,445 | $ | 60,871 | $ | 61,510 | $ | 60,433 | $ | 58,590 | ||||||||||
| Less: Goodwill and other acquisition-related intangible assets |
3,199 | 3,244 | 3,254 | 3,264 | 3,275 | |||||||||||||||
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| Tangible assets |
$ | 60,246 | $ | 57,627 | $ | 58,256 | $ | 57,169 | $ | 55,315 | ||||||||||
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| Tangible common equity ratio |
7.5 | % | 7.5 | % | 7.3 | % | 7.4 | % | 8.0 | % | ||||||||||
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TANGIBLE BOOK VALUE PER COMMON SHARE
| (in millions, except per common share data) |
Dec. 31, 2020 |
Sept. 30, 2020 |
June 30, 2020 |
March 31, 2020 |
Dec. 31, 2019 |
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| Tangible common equity |
$ | 4,513 | $ | 4,343 | $ | 4,265 | $ | 4,218 | $ | 4,428 | ||||||||||
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| Common shares issued |
533.68 | 533.67 | 533.59 | 533.47 | 532.83 | |||||||||||||||
| Less: Shares classified as treasury shares |
109.00 | 109.00 | 109.00 | 109.00 | 89.17 | |||||||||||||||
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| Common shares outstanding |
424.68 | 424.67 | 424.59 | 424.47 | 443.66 | |||||||||||||||
| Less: Unallocated ESOP shares |
5.57 | 5.66 | 5.75 | 5.84 | 5.92 | |||||||||||||||
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| Common shares |
419.11 | 419.01 | 418.84 | 418.63 | 437.74 | |||||||||||||||
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| Tangible book value per common share |
$ | 10.77 | $ | 10.36 | $ | 10.18 | $ | 10.07 | $ | 10.12 | ||||||||||
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19
| This ‘8-K’ Filing | Date | Other Filings | ||
|---|---|---|---|---|
 | ||||
| 2/15/21 | ||||
| 2/1/21 | ||||
| Filed on: | 1/22/21 | |||
| For Period end: | 1/21/21 | |||
| 1/20/21 | ||||
| 12/31/20 | 10-K, 10-K/A, 11-K, 13F-HR | |||
| 9/30/20 | 10-Q, 13F-HR | |||
| 6/30/20 | 10-Q, 13F-HR | |||
| 3/31/20 | 10-Q, 13F-HR | |||
| 1/1/20 | ||||
| 12/31/19 | 10-K, 11-K, 13F-HR | |||
| List all Filings | ||||