COLUMBUS, Ga.--(BUSINESS WIRE)--Synovus Financial Corp. (NYSE: SNV) today reported financial results for the quarter and year ended Dec. 31, 2023. "Synovus' 2023 financial performance is a testament to our resilience and the strength of our business model," said Synovus Chairman, CEO and President Kevin Blair. "Amid a challenging economic landscape in 2023, we broadened client relationships, further diversified our business mix, streamlined expenses and took strategic actions to optimize the balance sheet. Our strong banking footprint and ongoing investments in talent, capabilities, functionalities and new revenue sources fuel the bank's path to solid growth. We persist in bolstering our core deposit generation, enriching lending diversification, enhancing expense efficiency and delivering world-class client service. As we execute our plan, we're confident momentum will build throughout 2024 and beyond for Synovus."
2023 Highlights
- Net income available to common shareholders for 2023 was $507.8 million, or $3.46 per diluted share, compared to $724.7 million, or $4.95 per diluted share in 2022. Adjusted EPS for 2023 was $4.12 per diluted share compared to $4.93 per diluted share in 2022.
- The $51 million FDIC special assessment incurred during the fourth quarter 2023 reduced reported and adjusted EPS by $0.26.
- Pre-provision net revenue was $885.2 million in 2023 compared to $1.05 billion in 2022.
- Net interest income was $1.82 billion in 2023, up from $1.80 billion in the prior year, largely attributable to average loan growth and higher earning asset yields, which combined to more than offset rising funding costs.
- During 2023, Synovus sold $422 million in third-party consumer loans and $1.2 billion in medical office building loans with the proceeds used to pay down wholesale borrowings.
- Period-end loans declined $311.9 million, or 1%, in 2023 as commercial and industrial growth was more than offset by declines in commercial real estate and consumer loans.
- Period-end deposits increased $1.87 billion, or 4%, primarily driven by growth in time deposits and interest-bearing demand deposits, partially offset by a decline in non-interest-bearing deposits. Brokered deposits increased $744.0 million, or 14%, in 2023.
- During the fourth quarter 2023, Synovus repositioned its securities portfolio by selling $1.3 billion of bonds, which resulted in securities losses of $78 million. The proceeds have been reinvested in other high-quality liquid assets with better yields, which should augment 2024 net interest income by an estimated $28 million.
- Non-interest revenue was $404.0 million, down 1% from 2022. Adjusted non-interest revenue of $460.7 million grew 11% in 2023, primarily attributable to fee income related to treasury and payment solutions, capital markets and wealth management, as well as fees from banking as a service.
- Non-interest expense was $1.34 billion, up 15%, and adjusted non-interest expense increased 9% year over year in 2023 to $1.26 billion, but was significantly impacted by the $51 million FDIC special assessment.
- Credit quality remains healthy. Net charge-offs were 0.35% of average loans or 0.28%, excluding the loan sales in the third quarter, compared to 0.13% in 2022. The provision for credit losses was $189.1 million in 2023 compared to a provision of $84.6 million for the prior year. The allowance for credit losses ended the year at 1.24% compared to 1.15% at the end of 2022.
- The preliminary year-end CET1 ratio increased 59 basis points year over year to 10.22%, which is within our target operating range of 10.00% to 10.50%.
Fourth Quarter 2023 Highlights
- Net income available to common shareholders was $60.6 million, or $0.41 per diluted share, down $0.19 sequentially and down $0.94 compared to the fourth quarter 2022.
- The $51 million FDIC special assessment impacted fourth quarter 2023 reported and adjusted EPS by $0.26.
- Pre-provision net revenue of $135.8 million declined $60.9 million, or 31%, sequentially and was down $159.0 million, or 54%, compared to the fourth quarter 2022.
- Net interest income declined $5.9 million, or 1%, compared to the prior quarter and was down $64.1 million, or 13%, compared to the fourth quarter 2022, primarily attributable to a decline in average earnings assets and higher funding costs. Net interest margin was 3.11%, which was stable from the third quarter supported by rising asset yields, lower than expected core interest-bearing deposit cost and a decline in borrowings.
- Period-end loans declined $275.4 million, or 1%, from the third quarter as core commercial lending growth was more than offset by softer overall loan production, higher loan paydowns and strategic declines in certain loan categories such as non-relationship syndicated lending and third-party consumer lending.
- Core deposits increased $714.1 million, or 2%, sequentially. Total deposits ended the quarter at $50.74 billion, an increase of $535.3 million, or 1%, sequentially as a result of the focus on deposit production and seasonally higher commercial deposits and public funds.
- Total deposit costs increased 19 basis points from the third quarter 2023 to 2.50%. The bank's total deposit beta cycle to date through the fourth quarter 2023 has been 45%.
- Non-interest revenue of $51.5 million declined $55.7 million, or 52.0%, sequentially and decreased $51.0 million, or 50%, compared to the fourth quarter 2022. Non-interest revenue was impacted by $78 million in securities losses. Adjusted non-interest revenue of $126.2 million rose $19.9 million, or 19%, sequentially and increased $25.3 million, or 25%, compared to the fourth quarter 2022. The growth was primarily attributable to higher GreenSky income as well as stronger treasury and payment solutions and non-GLOBALT wealth management fees.
- On a sequential quarter basis, non-interest expense of $352.9 million was flat while adjusted non-interest expense increased 15% to $353.1 million, and compared to the prior year, non-interest expense and adjusted non-interest expense were up 14% and 15%, respectively. All comparisons were significantly impacted by the $51 million FDIC special assessment. Headcount declined 2% sequentially and 5% year over year.
- Credit quality ratios remain healthy. The non-performing loan and asset ratios were slightly higher at 0.66% and 0.66%, respectively; the net charge-off ratio for the quarter was 0.38%, and total past dues were 0.14% of total loans outstanding.
- Provision for credit losses of $45.5 million declined $27.1 million sequentially and compares to $72.6 million in the third quarter of 2023.
- The allowance for credit losses ratio (to loans) of 1.24% was up 2 basis points sequentially and up 9 basis points compared to the prior year. The quarter over quarter increase primarily reflects loan performance during the fourth quarter.
- The preliminary CET1 ratio rose sequentially to 10.22% as core earnings accretion more than offset the impact of the $51 million FDIC special assessment and $78 million in securities losses during the fourth quarter.
Fourth Quarter 2023 Summary
Reported | Adjusted | ||||||||||||||||||||||
(dollars in thousands) | 4Q23 | 3Q23 | 4Q22 | 4Q23 | 3Q23 | 4Q22 | |||||||||||||||||
Net income available to common shareholders | $ | 60,645 | $ | 87,423 | $ | 197,479 | $ | 116,901 | $ | 122,770 | $ | 197,576 | |||||||||||
Diluted earnings per share | 0.41 | 0.60 | 1.35 | 0.80 | 0.84 | 1.35 | |||||||||||||||||
Total revenue | 488,682 | 550,298 | 603,785 | 564,593 | 550,552 | 603,359 | |||||||||||||||||
Total loans | 43,404,490 | 43,679,910 | 43,716,353 | N/A | N/A | N/A | |||||||||||||||||
Total deposits | 50,739,185 | 50,203,890 | 48,871,559 | N/A | N/A | N/A | |||||||||||||||||
Return on avg assets | 0.47 | % | 0.64 | % | 1.38 | % | 0.84 | % | 0.87 | % | 1.39 | % | |||||||||||
Return on avg common equity | 5.9 | 8.2 | 20.9 | 11.3 | 11.5 | 20.9 | |||||||||||||||||
Return on avg tangible common equity | 7.0 | 9.7 | 24.2 | 13.3 | 13.5 | 24.2 | |||||||||||||||||
Net interest margin | 3.11 | % | 3.11 | % | 3.56 | % | N/A | N/A | N/A | ||||||||||||||
Efficiency ratio-TE(1)(2) | 72.03 | 64.11 | 51.08 | 61.97 | 55.01 | 50.58 | |||||||||||||||||
NCO ratio-QTD | 0.38 | 0.61 | 0.12 | N/A | N/A | N/A | |||||||||||||||||
NPA ratio | 0.66 | 0.64 | 0.33 | N/A | N/A | N/A | |||||||||||||||||
(1) Taxable equivalent (2) Adjusted tangible efficiency ratio | |||||||||||||||||||||||
Balance Sheet
Loans* | ||||||||||||||||||||||
(dollars in millions) | 4Q23 | 3Q23 | Linked
| Linked
| 4Q22 | Year/Year
| Year/Year
| |||||||||||||||
Commercial & industrial | $ | 22,598.5 | $ | 22,781.0 | $ | (182.5 | ) | (1 | )% | $ | 22,066.7 | $ | 531.8 | 2 | % | |||||||
Commercial real estate | 12,316.8 | 12,394.9 | (78.1 | ) | (1 | ) | 12,650.3 | (333.6 | ) | (3 | ) | |||||||||||
Consumer | 8,489.2 | 8,504.1 | (14.9 | ) | - | 8,999.4 | (510.1 | ) | (6 | ) | ||||||||||||
Total loans | $ | 43,404.5 | $ | 43,679.9 | $ | (275.4 | ) | (1 | )% | $ | 43,716.4 | $ | (311.9 | ) | (1 | )% | ||||||
* Amounts may not total due to rounding | ||||||||||||||||||||||
Deposits* | ||||||||||||||||||||||
(dollars in millions) | 4Q23 | 3Q23 | Linked
| Linked
| 4Q22 | Year/Year
| Year/Year
| |||||||||||||||
Non-interest-bearing DDA | $ | 11,801.2 | $ | 12,395.1 | $ | (593.9 | ) | (5)% | $ | 14,574.5 | $ | (2,773.3 | ) | (19 | )% | |||||||
Interest-bearing DDA | 6,541.0 | 6,276.1 | 264.9 | 4 | 5,761.4 | 779.6 | 14 | |||||||||||||||
Money market | 10,819.7 | 10,786.3 | 33.5 | - | 12,480.7 | (1,661.0 | ) | (13 | ) | |||||||||||||
Savings | 1,062.6 | 1,132.5 | (69.9 | ) | (6 | ) | 1,396.4 | (333.8 | ) | (24 | ) | |||||||||||
Public funds | 7,349.5 | 6,885.7 | 463.8 | 7 | 6,635.6 | 714.0 | 11 | |||||||||||||||
Time deposits | 7,122.2 | 6,506.4 | 615.8 | 9 | 2,724.1 | 4,398.1 | 161 | |||||||||||||||
Brokered deposits | 6,043.0 | 6,221.8 | (178.8 | ) | (3 | ) | 5,299.0 | 744.0 | 14 | |||||||||||||
Total deposits | $ | 50,739.2 | $ | 50,203.9 | $ | 535.3 | 1 | % | $ | 48,871.6 | $ | 1,867.6 | 4 | % | ||||||||
* Amounts may not total due to rounding | ||||||||||||||||||||||
Income Statement Summary* | |||||||||||||||||||||||||
(in thousands, except per share data) | 4Q23 | 3Q23 | Linked
| Linked
| 4Q22 | Year/Year
| Year/Year
| ||||||||||||||||||
Net interest income | $ | 437,214 | $ | 443,159 | $ | (5,945 | ) | (1 | )% | $ | 501,346 | $ | (64,132 | ) | (13 | )% | |||||||||
Non-interest revenue | 51,468 | 107,139 | (55,671 | ) | (52 | ) | 102,439 | (50,971 | ) | (50 | ) | ||||||||||||||
Non-interest expense | 352,858 | 353,532 | (674 | ) | - | 308,996 | 43,862 | 14 | |||||||||||||||||
Provision for (reversal of) credit losses | 45,472 | 72,572 | (27,100 | ) | (37 | ) | 34,884 | 10,588 | 30 | ||||||||||||||||
Income before taxes | $ | 90,352 | $ | 124,194 | $ | (33,842 | ) | (27 | )% | $ | 259,905 | $ | (169,553 | ) | (65 | )% | |||||||||
Income tax expense | 20,779 | 27,729 | (6,950 | ) | (25 | ) | 54,135 | (33,356 | ) | (62 | ) | ||||||||||||||
Net income | 69,573 | 96,465 | (26,892 | ) | (28 | ) | 205,770 | (136,197 | ) | (66 | ) | ||||||||||||||
Less: Net income (loss) attributable to noncontrolling interest | (768 | ) | (630 | ) | (138 | ) | 22 | - | (768 | ) | nm | ||||||||||||||
Net income attributable to Synovus Financial Corp. | 70,341 | 97,095 | (26,754 | ) | (28 | ) | 205,770 | (135,429 | ) | (66 | ) | ||||||||||||||
Less: Preferred stock dividends | 9,696 | 9,672 | 24 | - | 8,291 | 1,405 | 17 | ||||||||||||||||||
Net income available to common shareholders | $ | 60,645 | $ | 87,423 | $ | (26,778 | ) | (31 | )% | $ | 197,479 | $ | (136,834 | ) | (69 | )% | |||||||||
Weighted average common shares outstanding, diluted | 146,877 | 146,740 | 137 | - | 146,528 | 349 | - | ||||||||||||||||||
Diluted earnings per share | $ | 0.41 | $ | 0.60 | $ | (0.19 | ) | (32 | )% | $ | 1.35 | $ | (0.94 | ) | (70 | )% | |||||||||
Adjusted diluted earnings per share | $ | 0.80 | $ | 0.84 | $ | (0.04 | ) | (5 | ) | $ | 1.35 | $ | (0.55 | ) | (41 | ) % | |||||||||
Effective tax rate | 23.00 | % | 22.33 | % | 20.83 | % | |||||||||||||||||||
* Amounts may not total due to rounding | |||||||||||||||||||||||||
Capital Ratios | ||||||||
4Q23 | 3Q23 | 4Q22 | ||||||
Common equity Tier 1 capital (CET1) ratio | 10.22 | % | * | 10.13 | % | 9.63 | % | |
Tier 1 capital ratio | 11.28 | * | 11.18 | 10.68 | ||||
Total risk-based capital ratio | 13.07 | * | 13.12 | 12.54 | ||||
Tier 1 leverage ratio | 9.49 | * | 9.38 | 9.07 | ||||
Tangible common equity ratio | 6.84 | 5.90 | 5.84 | |||||
* Ratios are preliminary | ||||||||
Fourth Quarter 2023 Earnings Conference Call
Synovus will host an earnings highlights conference call at 8:30 a.m. ET on Jan. 18, 2024. The earnings call will be accompanied by a slide presentation. Shareholders and other interested parties may listen to this conference call via simultaneous internet broadcast. For a link to the webcast, go to investor.synovus.com/events. The replay will be archived for 12 months and will be available 30-45 minutes after the call.
Synovus Financial Corp. is a financial services company based in Columbus, Georgia, with approximately $60 billion in assets. Synovus provides commercial and consumer banking and a full suite of specialized products and services, including private banking, treasury management, wealth management, mortgage services, premium finance, asset-based lending, structured lending, capital markets and international banking. Synovus has 246 branches in Georgia, Alabama, South Carolina, Florida and Tennessee. Synovus is a Great Place to Work-Certified Company and is on the web at synovus.com and on X, formerly known as Twitter, Facebook, LinkedIn and Instagram.
Forward-Looking Statements
This press release and certain of our other filings with the Securities and Exchange Commission contain statements that constitute "forward-looking statements" within the meaning of, and subject to the protections of, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are forward-looking statements. You can identify these forward-looking statements through Synovus' use of words such as "believes," "anticipates," "expects," "may," "will," "assumes," "should," "predicts," "could," "would," "intends," "targets," "estimates," "projects," "plans," "potential" and other similar words and expressions of the future or otherwise regarding the outlook for Synovus' future business and financial performance and/or the performance of the banking industry and economy in general. These forward-looking statements include, among others, our expectations regarding our future operating and financial performance; expectations on our intended strategies, initiatives, and other operational and execution goals; expectations on credit quality and performance; and the assumptions underlying our expectations. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve known and unknown risks and uncertainties which may cause the actual results, performance or achievements of Synovus to be materially different from the future results, performance or achievements expressed or implied by such forward-looking statements. Forward-looking statements are based on the information known to, and current beliefs and expectations of, Synovus' management and are subject to significant risks and uncertainties. Actual results may differ materially from those contemplated by such forward-looking statements. A number of factors could cause actual results to differ materially from those contemplated by the forward-looking statements in this press release. Many of these factors are beyond Synovus' ability to control or predict.
These forward-looking statements are based upon information presently known to Synovus' management and are inherently subjective, uncertain and subject to change due to any number of risks and uncertainties, including, without limitation, the risks and other factors set forth in Synovus' filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2022, under the captions "Cautionary Notice Regarding Forward-Looking Statements" and "Risk Factors" and in Synovus' quarterly reports on Form 10-Q and current reports on Form 8-K. We believe these forward-looking statements are reasonable; however, undue reliance should not be placed on any forward-looking statements, which are based on current expectations and speak only as of the date that they are made. We do not assume any obligation to update any forward-looking statements as a result of new information, future developments or otherwise, except as otherwise may be required by law.
Non-GAAP Financial Measures
The measures entitled adjusted net income available to common shareholders; adjusted diluted earnings per share; adjusted non-interest revenue, adjusted non-interest expense; adjusted revenue; adjusted tangible efficiency ratio; adjusted return on average assets; adjusted return on average common equity; return on average tangible common equity; adjusted return on average tangible common equity; and tangible common equity ratio are not measures recognized under GAAP and therefore are considered non-GAAP financial measures. The most comparable GAAP measures to these measures are net income available to common shareholders; diluted earnings per share; total non-interest revenue; total non-interest expense; total revenue; efficiency ratio-TE; return on average assets; return on average common equity; and the ratio of total Synovus Financial Corp. shareholders' equity to total assets, respectively.
Management believes that these non-GAAP financial measures provide meaningful additional information about Synovus to assist management and investors in evaluating Synovus' operating results, financial strength, the performance of its business, and the strength of its capital position. However, these non-GAAP financial measures have inherent limitations as analytical tools and should not be considered in isolation or as a substitute for analyses of operating results or capital position as reported under GAAP. The non-GAAP financial measures should be considered as additional views of the way our financial measures are affected by significant items and other factors, and since they are not required to be uniformly applied, they may not be comparable to other similarly titled measures at other companies. Adjusted net income available to common shareholders, adjusted diluted earnings per share, adjusted return on average assets, and adjusted return on average common equity are measures used by management to evaluate operating results exclusive of items that are not indicative of ongoing operations and impact period-to-period comparisons. Adjusted non-interest revenue and adjusted revenue are measures used by management to evaluate non-interest revenue and total revenue exclusive of fair value adjustment on non-qualified deferred compensation and other items not indicative of ongoing operations that could impact period-to-period comparisons. Adjusted non-interest expense and the adjusted tangible efficiency ratio are measures utilized by management to measure the success of expense management initiatives focused on reducing recurring controllable operating costs. Return on average tangible common equity and adjusted return on average tangible common equity are measures used by management to compare Synovus' performance with other financial institutions because it calculates the return available to common shareholders without the impact of intangible assets and their related amortization, thereby allowing management to evaluate the performance of the business consistently. The tangible common equity ratio is used by management to assess the strength of our capital position. The computations of these measures are set forth in the tables below.
Reconciliation of Non-GAAP Financial Measures | |||||||||||||||||||
(in thousands, except per share data) | 4Q23 | 3Q23 | 4Q22 | 2023 | 2022 | ||||||||||||||
Adjusted net income available to common shareholders and adjusted net income per common share, diluted | |||||||||||||||||||
Net income available to common shareholders | $ | 60,645 | $ | 87,423 | $ | 197,479 | $ | 507,755 | $ | 724,739 | |||||||||
(Gain) on sale of GLOBALT | - | (1,929 | ) | - | (1,929 | ) | - | ||||||||||||
Restructuring charges (reversals) | 1,231 | 17,319 | (2,372 | ) | 17,707 | (9,690 | ) | ||||||||||||
Valuation adjustment to Visa derivative | - | 900 | 2,500 | 3,927 | 6,000 | ||||||||||||||
(Gain) loss on early extinguishment of debt | (4,497 | ) | (526 | ) | - | (5,400 | ) | 677 | |||||||||||
Recovery of NPA | - | - | - | (13,126 | ) | - | |||||||||||||
Loss on other loans held for sale | - | 30,954 | - | 50,064 | - | ||||||||||||||
Investment securities (gains) losses, net | 77,748 | - | - | 76,718 | - | ||||||||||||||
Tax effect of adjustments(1) | (18,226 | ) | (11,371 | ) | (31 | ) | (31,312 | ) | 733 | ||||||||||
Adjusted net income available to common shareholders | $ | 116,901 | $ | 122,770 | $ | 197,576 | $ | 604,404 | $ | 722,459 | |||||||||
Weighted average common shares outstanding, diluted | 146,877 | 146,740 | 146,528 | 146,734 | 146,481 | ||||||||||||||
Net income per common share, diluted | $ | 0.41 | $ | 0.60 | $ | 1.35 | $ | 3.46 | $ | 4.95 | |||||||||
Adjusted net income per common share, diluted | 0.80 | 0.84 | 1.35 | 4.12 | 4.93 | ||||||||||||||
(1) An assumed marginal tax rate of 24.5% for 4Q23 and 2023 and 24.3% for 3Q23, 4Q22, and 2022 was applied. | |||||||||||||||||||
Reconciliation of Non-GAAP Financial Measures, continued | |||||||||||||||||||
(dollars in thousands) | 4Q23 | 3Q23 | 4Q22 | 2023 | 2022 | ||||||||||||||
Adjusted non-interest revenue | |||||||||||||||||||
Total non-interest revenue | $ | 51,468 | $ | 107,139 | $ | 102,439 | $ | 404,010 | $ | 409,336 | |||||||||
(Gain) on sale of GLOBALT | - | (1,929 | ) | - | (1,929 | ) | - | ||||||||||||
Recovery of NPA | - | - | - | (13,126 | ) | - | |||||||||||||
Investment securities (gains) losses, net | 77,748 | - | - | 76,718 | - | ||||||||||||||
Fair value adjustment on non-qualified deferred compensation | (3,053 | ) | 1,035 | (1,557 | ) | (4,987 | ) | 4,054 | |||||||||||
Adjusted non-interest revenue | $ | 126,163 | $ | 106,245 | $ | 100,882 | $ | 460,686 | $ | 413,390 | |||||||||
Adjusted non-interest expense | |||||||||||||||||||
Total non-interest expense | $ | 352,858 | $ | 353,532 | $ | 308,996 | $ | 1,335,424 | $ | 1,157,506 | |||||||||
(Loss) gain on other loans held for sale | - | (30,954 | ) | - | (50,064 | ) | - | ||||||||||||
Restructuring (charges) reversals | (1,231 | ) | (17,319 | ) | 2,372 | (17,707 | ) | 9,690 | |||||||||||
Valuation adjustment to Visa derivative | - | (900 | ) | (2,500 | ) | (3,927 | ) | (6,000 | ) | ||||||||||
Gain (loss) on early extinguishment of debt | 4,497 | 526 | - | 5,400 | (677 | ) | |||||||||||||
Fair value adjustment on non-qualified deferred compensation | (3,053 | ) | 1,035 | (1,557 | ) | (4,987 | ) | 4,054 | |||||||||||
Adjusted non-interest expense | $ | 353,071 | $ | 305,920 | $ | 307,311 | $ | 1,264,139 | $ | 1,164,573 | |||||||||
(dollars in thousands) | 4Q23 | 3Q23 | 4Q22 | ||||||||
Adjusted revenue and tangible efficiency ratio | |||||||||||
Adjusted non-interest expense | $ | 353,071 | $ | 305,920 | $ | 307,311 | |||||
Amortization of intangibles | (3,168 | ) | (3,042 | ) | (2,118 | ) | |||||
Adjusted tangible non-interest expense | $ | 349,903 | $ | 302,878 | $ | 305,193 | |||||
Net interest income | $ | 437,214 | $ | 443,159 | $ | 501,346 | |||||
Total non-interest revenue | 51,468 | 107,139 | 102,439 | ||||||||
Total revenue | 488,682 | 550,298 | 603,785 | ||||||||
Tax equivalent adjustment | 1,216 | 1,148 | 1,131 | ||||||||
Total TE revenue | 489,898 | 551,446 | 604,916 | ||||||||
(Gain) on sale of GLOBALT | - | (1,929 | ) | - | |||||||
Recovery of NPA | - | - | - | ||||||||
Investment securities (gains) losses, net | 77,748 | - | - | ||||||||
Fair value adjustment on non-qualified deferred compensation | (3,053 | ) | 1,035 | (1,557 | ) | ||||||
Adjusted revenue | $ | 564,593 | $ | 550,552 | $ | 603,359 | |||||
Efficiency ratio-TE | 72.03 | % | 64.11 | % | 51.08 | % | |||||
Adjusted tangible efficiency ratio | 61.97 | 55.01 | 50.58 | ||||||||
Reconciliation of Non-GAAP Financial Measures, continued | |||||||||||
(in thousands, except per share data) | 4Q23 | 3Q23 | 4Q22 | ||||||||
Adjusted return on average assets (annualized) | |||||||||||
Net income | $ | 69,573 | $ | 96,465 | $ | 205,770 | |||||
Loss on other loans held for sale | - | 30,954 | - | ||||||||
Restructuring charges (reversals) | 1,231 | 17,319 | (2,372 | ) | |||||||
(Gain) on sale of GLOBALT | - | (1,929 | ) | - | |||||||
Valuation adjustment to Visa derivative | - | 900 | 2,500 | ||||||||
(Gain) on early extinguishment of debt | (4,497 | ) | (526 | ) | - | ||||||
Investment securities (gains) losses, net | 77,748 | - | - | ||||||||
Tax effect of adjustments(1) | (18,226 | ) | (11,371 | ) | (31 | ) | |||||
Adjusted net income | $ | 125,829 | $ | 131,812 | $ | 205,867 | |||||
Net income annualized | $ | 276,023 | $ | 382,714 | $ | 816,370 | |||||
Adjusted net income annualized | $ | 499,213 | $ | 522,950 | $ | 816,755 | |||||
Total average assets | $ | 59,164,065 | $ | 59,916,679 | $ | 58,963,417 | |||||
Return on average assets (annualized) | 0.47 | % | 0.64 | % | 1.38 | % | |||||
Adjusted return on average assets (annualized) | 0.84 | 0.87 | 1.39 | ||||||||
(1) An assumed marginal tax rate of 24.5% for 4Q23 and 24.3% for both 3Q23 and 4Q22 was applied. | |||||||||||
Reconciliation of Non-GAAP Financial Measures, continued | |||||||||||
(dollars in thousands) | 4Q23 | 3Q23 | 4Q22 | ||||||||
Adjusted return on average common equity, return on average tangible common equity, and adjusted return on average tangible common equity (annualized) | |||||||||||
Net income available to common shareholders | $ | 60,645 | $ | 87,423 | $ | 197,479 | |||||
Loss on other loans held for sale | - | 30,954 | - | ||||||||
Restructuring charges (reversals) | 1,231 | 17,319 | (2,372 | ) | |||||||
(Gain) on sale of GLOBALT | - | (1,929 | ) | - | |||||||
Valuation adjustment to Visa derivative | - | 900 | 2,500 | ||||||||
(Gain) on early extinguishment of debt | (4,497 | ) | (526 | ) | - | ||||||
Subtract/add: Investment securities (gains) losses, net | 77,748 | - | - | ||||||||
Subtract/add: Tax effect of adjustments(1) | (18,226 | ) | (11,371 | ) | (31 | ) | |||||
Adjusted net income available to common shareholders | $ | 116,901 |
| $ | 122,770 | $ | 197,576 | ||||
Adjusted net income available to common shareholders annualized | $ | 463,792 | $ | 487,077 | $ | 783,861 | |||||
Amortization of intangibles, tax effected, annualized | 9,493 | 9,131 | 6,358 | ||||||||
Adjusted net income available to common shareholders excluding amortization of intangibles annualized | $ | 473,285 | $ | 496,208 | $ | 790,219 | |||||
Net income available to common shareholders annualized | $ | 240,602 | $ | 346,841 | $ | 783,476 | |||||
Amortization of intangibles, tax effected, annualized | 9,493 | 9,131 | 6,358 | ||||||||
Net income available to common shareholders excluding amortization of intangibles annualized | $ | 250,095 | $ | 355,972 | $ | 789,834 | |||||
Total average Synovus Financial Corp. shareholders' equity less preferred stock | $ | 4,090,163 | $ | 4,223,422 | $ | 3,742,927 | |||||
Average goodwill | (479,858 | ) | (476,408 | ) | (452,390 | ) | |||||
Average other intangible assets, net | (47,502 | ) | (59,016 | ) | (28,174 | ) | |||||
Total average Synovus Financial Corp. tangible shareholders' equity less preferred stock | $ | 3,562,803 | $ | 3,687,998 | $ | 3,262,363 | |||||
Return on average common equity (annualized) | 5.9 | % | 8.2 | % | 20.9 | % | |||||
Adjusted return on average common equity (annualized) | 11.3 | 11.5 | 20.9 | ||||||||
Return on average tangible common equity (annualized) | 7.0 | 9.7 | 24.2 | ||||||||
Adjusted return on average tangible common equity (annualized) | 13.3 | 13.5 | 24.2 | ||||||||
(1) An assumed marginal tax rate of 24.5% for 4Q23 and 24.3% for both 3Q23 and 4Q22 was applied. | |||||||||||
Reconciliation of Non-GAAP Financial Measures, continued | |||||||||||
December 31, | September 30, | December 31, | |||||||||
(dollars in thousands) | 2023 | 2023 | 2022 | ||||||||
Tangible common equity ratio | |||||||||||
Total assets | $ | 59,809,534 | $ | 59,342,930 | $ | 59,731,378 | |||||
Goodwill | (480,440 | ) | (479,851 | ) | (452,390 | ) | |||||
Other intangible assets, net | (45,928 | ) | (49,096 | ) | (27,124 | ) | |||||
Tangible assets | $ | 59,283,166 | $ | 58,813,983 | $ | 59,251,864 | |||||
Total Synovus Financial Corp. shareholders' equity | $ | 5,119,993 | $ | 4,536,958 | $ | 4,475,801 | |||||
Goodwill | (480,440 | ) | (479,851 | ) | (452,390 | ) | |||||
Other intangible assets, net | (45,928 | ) | (49,096 | ) | (27,124 | ) | |||||
Preferred stock, no par value | (537,145 | ) | (537,145 | ) | (537,145 | ) | |||||
Tangible common equity | $ | 4,056,480 | $ | 3,470,866 | $ | 3,459,142 | |||||
Total Synovus Financial Corp. shareholders' equity to total assets ratio | 8.56 | % | 7.65 | % | 7.49 | % | |||||
Tangible common equity ratio | 6.84 | 5.90 | 5.84 | ||||||||
Synovus | ||||||||||||
INCOME STATEMENT DATA | ||||||||||||
(Unaudited) | Years Ended | |||||||||||
(Dollars in thousands, except per share data) | December 31, | |||||||||||
2023 | 2022 | % Change | ||||||||||
Interest income | $ | 3,050,358 | $ | 2,075,787 | 47 | % | ||||||
Interest expense | 1,233,703 | 278,887 | 342 | |||||||||
Net interest income | 1,816,655 | 1,796,900 | 1 | |||||||||
Provision for (reversal of) credit losses | 189,079 | 84,553 | 124 | |||||||||
Net interest income after provision for credit losses | 1,627,576 | 1,712,347 | (5 | ) | ||||||||
Non-interest revenue: | ||||||||||||
Service charges on deposit accounts | 90,096 | 93,067 | (3 | ) | ||||||||
Fiduciary and asset management fees | 78,077 | 78,414 | - | |||||||||
Card fees | 72,357 | 61,833 | 17 | |||||||||
Brokerage revenue | 83,431 | 67,034 | 24 | |||||||||
Mortgage banking income | 15,157 | 17,476 | (13 | ) | ||||||||
Capital markets income | 32,181 | 26,702 | 21 | |||||||||
Income from bank-owned life insurance | 31,429 | 29,720 | 6 | |||||||||
Investment securities gains (losses), net | (76,718 | ) | - | nm | ||||||||
Recovery of NPA | 13,126 | - | nm | |||||||||
Other non-interest revenue | 64,874 | 35,090 | 85 | |||||||||
Total non-interest revenue | 404,010 | 409,336 | (1 | ) | ||||||||
Non-interest expense: | ||||||||||||
Salaries and other personnel expense | 728,378 | 681,710 | 7 | |||||||||
Net occupancy, equipment, and software expense | 179,581 | 174,730 | 3 | |||||||||
Third-party processing and other services | 86,649 | 88,617 | (2 | ) | ||||||||
Professional fees | 39,854 | 37,189 | 7 | |||||||||
FDIC insurance and other regulatory fees | 94,737 | 29,083 | 226 | |||||||||
Restructuring charges (reversals) | 17,707 | (9,690 | ) | (283 | ) | |||||||
Loss on other loans held for sale | 50,064 | - | nm | |||||||||
Other operating expenses | 138,454 | 155,867 | (11 | ) | ||||||||
Total non-interest expense | 1,335,424 | 1,157,506 | 15 | |||||||||
Income before income taxes | 696,162 | 964,177 | (28 | ) | ||||||||
Income tax expense | 154,021 | 206,275 | (25 | ) | ||||||||
Net income | 542,141 | 757,902 | (28 | ) | ||||||||
Less: Net income (loss) attributable to noncontrolling interest | (1,564 | ) | - | nm | ||||||||
Net income attributable to Synovus Financial Corp. | 543,705 | 757,902 | (28 | ) | ||||||||
Less: Preferred stock dividends | 35,950 | 33,163 | 8 | |||||||||
Net income available to common shareholders | $ | 507,755 | $ | 724,739 | (30 | )% | ||||||
Net income per common share, basic | 3.48 | 4.99 | (30 | )% | ||||||||
Net income per common share, diluted | 3.46 | 4.95 | (30 | ) | ||||||||
Cash dividends declared per common share | 1.52 | 1.36 | 12 | |||||||||
Return on average assets | 0.90 | % | 1.32 | % | (42) | bps | ||||||
Return on average common equity | 12.17 | 17.41 | (524 | ) | ||||||||
Weighted average common shares outstanding, basic | 146,115 | 145,364 | 1 | % | ||||||||
Weighted average common shares outstanding, diluted | 146,734 | 146,481 | - | |||||||||
nm - not meaningful | ||||||||||||
bps - basis points | ||||||||||||
Synovus | |||||||||||||||||||
INCOME STATEMENT DATA | |||||||||||||||||||
(Unaudited) | |||||||||||||||||||
(Dollars in thousands, except per share data) | 2023 | 2022 | Fourth
| ||||||||||||||||
Fourth
| Third
| Second
| First
| Fourth
| 23 vs '22 | ||||||||||||||
% Change | |||||||||||||||||||
Interest income | $ | 788,297 | 786,039 | 759,143 | 716,879 | 654,654 | 20 | % | |||||||||||
Interest expense | 351,083 | 342,880 | 303,612 | 236,128 | 153,308 | 129 | |||||||||||||
Net interest income | 437,214 | 443,159 | 455,531 | 480,751 | 501,346 | (13 | ) | ||||||||||||
Provision for (reversal of) credit losses | 45,472 | 72,572 | 38,881 | 32,154 | 34,884 | 30 | |||||||||||||
Net interest income after provision for credit losses | 391,742 | 370,587 | 416,650 | 448,597 | 466,462 | (16 | ) | ||||||||||||
Non-interest revenue: | |||||||||||||||||||
Service charges on deposit accounts | 22,260 | 21,385 | 23,477 | 22,974 | 23,639 | (6 | ) | ||||||||||||
Fiduciary and asset management fees | 18,149 | 20,205 | 20,027 | 19,696 | 18,836 | (4 | ) | ||||||||||||
Card fees | 20,872 | 18,602 | 17,059 | 15,824 | 15,887 | 31 | |||||||||||||
Brokerage revenue | 19,727 | 20,237 | 20,908 | 22,558 | 19,996 | (1 | ) | ||||||||||||
Mortgage banking income | 3,019 | 3,671 | 4,609 | 3,858 | 2,554 | 18 | |||||||||||||
Capital markets income | 5,104 | 6,377 | 6,975 | 13,725 | 6,998 | (27 | ) | ||||||||||||
Income from bank-owned life insurance | 10,324 | 6,965 | 6,878 | 7,262 | 7,206 | 43 | |||||||||||||
Investment securities gains (losses), net | (77,748 | ) | - | - | 1,030 | - | nm | ||||||||||||
Recovery of NPA | - | - | - | 13,126 | - | nm | |||||||||||||
Other non-interest revenue | 29,761 | 9,697 | 12,343 | 13,073 | 7,323 | 306 | |||||||||||||
Total non-interest revenue | 51,468 | 107,139 | 112,276 | 133,126 | 102,439 | (50 | ) | ||||||||||||
Non-interest expense: | |||||||||||||||||||
Salaries and other personnel expense | 176,712 | 179,741 | 183,001 | 188,924 | 182,629 | (3 | ) | ||||||||||||
Net occupancy, equipment, and software expense | 48,146 | 45,790 | 42,785 | 42,860 | 45,192 | 7 | |||||||||||||
Third-party processing and other services | 21,717 | 21,439 | 21,659 | 21,833 | 23,130 | (6 | ) | ||||||||||||
Professional fees | 11,147 | 10,147 | 9,597 | 8,963 | 11,096 | - | |||||||||||||
FDIC insurance and other regulatory fees | 61,470 | 11,837 | 11,162 | 10,268 | 8,232 | 647 | |||||||||||||
Restructuring charges (reversals) | 1,231 | 17,319 | (110 | ) | (733 | ) | (2,372 | ) | (152 | ) | |||||||||
Loss on other loans held for sale | - | 30,954 | 2,360 | 16,750 | - | nm | |||||||||||||
Other operating expenses | 32,435 | 36,305 | 36,727 | 32,987 | 41,089 | (21 | ) | ||||||||||||
| |||||||||||||||||||
Total non-interest expense | 352,858 | 353,532 | 307,181 | 321,852 | 308,996 | 14 | |||||||||||||
Income before income taxes | 90,352 | 124,194 | 221,745 | 259,871 | 259,905 | (65 | ) | ||||||||||||
Income tax expense | 20,779 | 27,729 | 47,801 | 57,712 | 54,135 | (62 | ) | ||||||||||||
Net income | 69,573 | 96,465 | 173,944 | 202,159 | 205,770 | (66 | ) | ||||||||||||
Less: Net income (loss) attributable to noncontrolling | (768 | ) | (630 | ) | (166 | ) | - | - | nm | ||||||||||
Net income attributable to Synovus Financial Corp. | 70,341 | 97,095 | 174,110 | 202,159 | 205,770 | (66 | ) | ||||||||||||
Less: Preferred stock dividends | 9,696 | 9,672 | 8,291 | 8,291 | 8,291 | 17 | |||||||||||||
Net income available to common shareholders | $ | 60,645 | 87,423 | 165,819 | 193,868 | 197,479 | (69 | ) | |||||||||||
Net income per common share, basic | $ | 0.41 | 0.60 | 1.13 | 1.33 | 1.36 | (69 | )% | |||||||||||
Net income per common share, diluted | 0.41 | 0.60 | 1.13 | 1.32 | 1.35 | (69 | ) | ||||||||||||
Cash dividends declared per common share | 0.38 | 0.38 | 0.38 | 0.38 | 0.34 | 12 | |||||||||||||
Return on average assets * | 0.47 | % | 0.64 | 1.15 | 1.36 | 1.38 | (91) | bps | |||||||||||
Return on average common equity * | 5.88 | 8.21 | 15.45 | 19.23 | 20.93 | nm | |||||||||||||
Weighted average common shares outstanding, basic | 146,372 | 146,170 | 146,113 | 145,799 | 145,467 | 1 | % | ||||||||||||
Weighted average common shares outstanding, diluted | 146,877 | 146,740 | 146,550 | 146,727 | 146,528 | - | |||||||||||||
nm - not meaningful | |||||||||||||||||||
bps - basis points | |||||||||||||||||||
* - ratios are annualized | |||||||||||||||||||
Synovus | |||||||||||||
BALANCE SHEET DATA | December 31, 2023 | September 30, 2023 | December 31, 2022 | ||||||||||
(Unaudited) | |||||||||||||
(In thousands, except share data) | |||||||||||||
ASSETS | |||||||||||||
Cash and due from banks | $ | 601,188 | $ | 604,631 | $ | 624,097 | |||||||
Interest-bearing funds with Federal Reserve Bank | 1,741,059 | 1,431,356 | 1,280,684 | ||||||||||
Interest earning deposits with banks | 71,856 | 65,468 | 34,632 | ||||||||||
Federal funds sold and securities purchased under resale agreements | 37,323 | 36,176 | 38,367 | ||||||||||
Cash and cash equivalents | 2,451,426 | 2,137,631 | 1,977,780 | ||||||||||
| |||||||||||||
Investment securities available for sale, at fair value | 9,788,662 | 9,237,191 | 9,678,103 | ||||||||||
Loans held for sale ($47,338, $48,994 and $51,136 measured at fair value, respectively) | 52,768 | 66,558 | 391,502 | ||||||||||
Loans, net of deferred fees and costs | 43,404,490 | 43,679,910 | 43,716,353 | ||||||||||
Allowance for loan losses | (479,385 | ) | (477,532 | ) | (443,424 | ) | |||||||
Loans, net | 42,925,105 | 43,202,378 | 43,272,929 | ||||||||||
Cash surrender value of bank-owned life insurance | 1,112,030 | 1,107,092 | 1,089,280 | ||||||||||
Premises, equipment, and software, net | 365,851 | 364,054 | 370,632 | ||||||||||
Goodwill | 480,440 | 479,851 | 452,390 | ||||||||||
Other intangible assets, net | 45,928 | 49,096 | 27,124 | ||||||||||
Other assets | 2,587,324 | 2,699,079 | 2,471,638 | ||||||||||
Total assets | $ | 59,809,534 | $ | 59,342,930 | $ | 59,731,378 | |||||||
LIABILITIES AND SHAREHOLDERS' EQUITY | |||||||||||||
Liabilities: | |||||||||||||
Deposits: | |||||||||||||
Non-interest-bearing deposits | $ | 12,507,616 | $ | 12,976,574 | $ | 15,639,899 | |||||||
Interest-bearing deposits | 38,231,569 | 37,227,316 | 33,231,660 | ||||||||||
Total deposits | 50,739,185 | 50,203,890 | 48,871,559 | ||||||||||
Federal funds purchased and securities sold under repurchase agreements | 189,074 | 98,270 | 146,588 | ||||||||||
Other short-term borrowings | 3,496 | 2,362 | 603,384 | ||||||||||
Long-term debt | 1,932,534 | 2,704,701 | 4,109,597 | ||||||||||
Other liabilities | 1,801,097 | 1,772,139 | 1,524,449 | ||||||||||
Total liabilities | 54,665,386 | 54,781,362 | 55,255,577 | ||||||||||
Shareholders' equity: | |||||||||||||
Preferred stock - no par value. Authorized 100,000,000 shares; issued 22,000,000 | 537,145 | 537,145 | 537,145 | ||||||||||
Common stock - $1.00 par value. Authorized 342,857,143 shares; issued 171,360,188, 170,859,506, and 170,141,492 respectively; outstanding 146,705,330, 146,204,648, and 145,486,634 respectively | 171,360 | 170,860 | 170,141 | ||||||||||
Additional paid-in capital | 3,955,819 | 3,940,507 | 3,920,346 | ||||||||||
Treasury stock, at cost - 24,654,858 shares | (944,484 | ) | (944,484 | ) | (944,484 | ) | |||||||
Accumulated other comprehensive income (loss), net | (1,117,073 | ) | (1,679,404 | ) | (1,442,117 | ) | |||||||
Retained earnings | 2,517,226 | 2,512,334 | 2,234,770 | ||||||||||
Total Synovus Financial Corp. shareholders' equity | 5,119,993 | 4,536,958 | 4,475,801 | ||||||||||
Noncontrolling interest in subsidiary | 24,155 | 24,610 | - | ||||||||||
Total equity | 5,144,148 | 4,561,568 | 4,475,801 | ||||||||||
Total liabilities and shareholders' equity | $ | 59,809,534 | $ | 59,342,930 | $ | 59,731,378 | |||||||
Synovus | |||||||||||||||||||
AVERAGE BALANCES, INTEREST, AND YIELDS/RATES | |||||||||||||||||||
(Unaudited) | |||||||||||||||||||
2023 | 2022 | ||||||||||||||||||
(dollars in thousands) | Average
| Interest | Yield/
| Average
| Interest | Yield/
| |||||||||||||
Assets | |||||||||||||||||||
Interest earning assets: | |||||||||||||||||||
Commercial loans (1) (2) (3) | $ | 35,188,678 | $ | 2,263,117 | 6.43 | % | $ | 32,402,218 | $ | 1,448,463 | 4.47 | % | |||||||
Consumer loans (1) (2) | 8,557,650 | 426,266 | 4.98 | 8,823,424 | 361,524 | 4.10 | |||||||||||||
Less: Allowance for loan losses | (463,493 | ) | (421,506 | ) | - | - | |||||||||||||
Loans, net | 43,282,835 | 2,689,383 | 6.21 | 40,804,136 | 1,809,987 | 4.44 | |||||||||||||
Investment securities available for sale | 11,212,956 | 248,294 | 2.21 | 11,208,886 | 209,951 | 1.87 | |||||||||||||
Trading account assets | 15,486 | 886 | 5.72 | 13,374 | 261 | 1.95 | |||||||||||||
Other earning assets(4) | 1,414,586 | 71,349 | 4.98 | 1,220,653 | 18,756 | 1.52 | |||||||||||||
FHLB and Federal Reserve Bank stock | 254,420 | 14,975 | 5.89 | 214,289 | 6,722 | 3.14 | |||||||||||||
Mortgage loans held for sale | 46,035 | 2,993 | 6.50 | 75,325 | 3,353 | 4.45 | |||||||||||||
Other loans held for sale | 469,689 | 27,099 | 5.69 | 682,961 | 30,684 | 4.43 | |||||||||||||
Total interest earning assets | 56,696,007 | $ | 3,054,979 | 5.39 | % | 54,219,624 | $ | 2,079,714 | 3.84 | % | |||||||||
Cash and due from banks | 575,370 | 574,250 | |||||||||||||||||
Premises and equipment | 367,159 | 385,622 | |||||||||||||||||
Other real estate | - | 6,356 | |||||||||||||||||
Cash surrender value of bank-owned life insurance | 1,099,641 | 1,078,653 | |||||||||||||||||
Other assets(5) | 1,183,691 | 1,345,568 | |||||||||||||||||
Total assets | $ | 59,921,868 | $ | 57,610,073 | |||||||||||||||
Liabilities and Shareholders' Equity | |||||||||||||||||||
Interest-bearing liabilities: | |||||||||||||||||||
Interest-bearing demand deposits | $ | 9,884,039 | $ | 176,595 | 1.79 | % | $ | 9,027,636 | $ | 25,912 | 0.29 | % | |||||||
Money market accounts | 13,511,442 | 356,562 | 2.64 | 15,385,765 | 79,567 | 0.52 | |||||||||||||
Savings deposits | 1,229,975 | 1,046 | 0.09 | 1,481,372 | 399 | 0.03 | |||||||||||||
Time deposits | 5,473,405 | 196,481 | 3.59 | 2,667,101 | 13,902 | 0.52 | |||||||||||||
Brokered deposits | 6,104,461 | 296,071 | 4.85 | 3,644,957 | 67,452 | 1.85 | |||||||||||||
Federal funds purchased and securities sold under repurchase agreements | 97,114 | 1,667 | 1.69 | 205,753 | 1,308 | 0.63 | |||||||||||||
Other short-term borrowings | 528,194 | 24,611 | 4.60 | 466,254 | 10,945 | 2.32 | |||||||||||||
Long-term debt | 3,027,746 | 180,670 | 5.92 | 1,999,595 | 79,402 | 3.95 | |||||||||||||
Total interest-bearing liabilities | 39,856,376 | $ | 1,233,703 | 3.10 | % | 34,878,433 | $ | 278,887 | 0.80 | % | |||||||||
Non-interest-bearing demand deposits | 13,662,660 | 16,731,967 | |||||||||||||||||
Other liabilities | 1,671,489 | 1,298,972 | |||||||||||||||||
Shareholders' equity | 4,731,343 | 4,700,701 | |||||||||||||||||
Total liabilities and shareholders' equity | $ | 59,921,868 | $ | 57,610,073 | |||||||||||||||
Net interest income, taxable equivalent net interest margin (6) | $ | 1,821,276 | 3.21 | % | $ | 1,800,827 | 3.32 | % | |||||||||||
Less: taxable-equivalent adjustment | 4,621 | 3,927 | |||||||||||||||||
Net interest income | $ | 1,816,655 | $ | 1,796,900 | |||||||||||||||
| (1) | Average loans are shown net of deferred fees and costs. NPLs are included. |
| (2) | Interest income includes net loan fees as follows: 2023 - $47.7 million and 2022 - $57.3 million. |
| (3) | Reflects taxable-equivalent adjustments, using the statutory federal tax rate of 21%, in adjusting interest on tax-exempt loans and investment securities to a taxable-equivalent basis. |
| (4) | Includes interest-bearing funds with Federal Reserve Bank, interest earning deposits with banks, and federal funds sold and securities purchased under resale agreements. |
| (5) | Includes average net unrealized gains/(losses) on investment securities available for sale of $(1.62) billion and $(985.6) million for the years ended December 31, 2023 and 2022, respectively. |
| (6) | The net interest margin is calculated by dividing net interest income-taxable equivalent by average total interest earning assets. |
Synovus | |||||||||||||||||||||||||||||
AVERAGE BALANCES, INTEREST, AND YIELDS/RATES | |||||||||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||||||
Fourth Quarter 2023 | Third Quarter 2023 | Fourth Quarter 2022 | |||||||||||||||||||||||||||
(dollars in thousands) | Average
| Interest | Yield/
| Average
| Interest | Yield/
| Average
| Interest | Yield/
| ||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||
Interest earning assets: | |||||||||||||||||||||||||||||
Commercial loans (1) (2) (3) | $ | 35,106,156 | $ | 590,588 | 6.67 | % | $ | 34,990,459 | $ | 579,177 | 6.57 | % | $ | 34,103,384 | $ | 474,439 | 5.52 | % | |||||||||||
Consumer loans (1) (2) | 8,491,244 | 109,509 | 5.14 | 8,509,757 | 108,065 | 5.06 | 9,041,520 | 101,905 | 4.50 | ||||||||||||||||||||
Less: Allowance for loan losses | (480,332 | ) | (461,385 | ) | (427,525 | ) | |||||||||||||||||||||||
Loans, net | 43,117,068 | 700,097 | 6.45 | 43,038,831 | 687,242 | 6.34 | 42,717,379 | 576,344 | 5.36 | ||||||||||||||||||||
Investment securities available for sale | 11,164,487 | 65,176 | 2.33 | 11,194,291 | 61,642 | 2.20 | 11,296,449 | 58,840 | 2.08 | ||||||||||||||||||||
Trading account assets | 13,067 | 215 | 6.59 | 16,186 | 237 | 5.86 | 15,552 | 68 | 1.75 | ||||||||||||||||||||
Other earning assets(4) | 1,463,176 | 19,689 | 5.26 | 1,237,445 | 16,369 | 5.17 | 1,148,099 | 10,490 | 3.58 | ||||||||||||||||||||
FHLB and Federal Reserve Bank stock | 187,015 | 3,536 | 7.56 | 244,906 | 3,783 | 6.18 | 270,822 | 2,805 | 4.14 | ||||||||||||||||||||
Mortgage loans held for sale | 39,024 | 696 | 7.14 | 53,904 | 879 | 6.52 | 46,240 | 688 | 5.95 | ||||||||||||||||||||
Other loans held for sale | 8,044 | 104 | 5.06 | 881,067 | 17,035 | 7.57 | 514,811 | 6,550 | 4.98 | ||||||||||||||||||||
Total interest earning assets | 55,991,881 | $ | 789,513 | 5.59 | % | 56,666,630 | $ | 787,187 | 5.51 | % | 56,009,352 | $ | 655,785 | 4.65 | % | ||||||||||||||
Cash and due from banks | 522,986 | 509,511 | 651,189 | ||||||||||||||||||||||||||
Premises and equipment | 366,647 | 365,568 | 375,352 | ||||||||||||||||||||||||||
Other real estate | - | - | - | ||||||||||||||||||||||||||
Cash surrender value of bank-owned life insurance | 1,108,766 | 1,102,626 | 1,085,394 | ||||||||||||||||||||||||||
Other assets(5) | 1,173,785 | 1,272,344 | 842,130 | ||||||||||||||||||||||||||
Total assets | $ | 59,164,065 | $ | 59,916,679 | $ | 58,963,417 | |||||||||||||||||||||||
Liabilities and Shareholders' Equity | |||||||||||||||||||||||||||||
Interest-bearing liabilities: | |||||||||||||||||||||||||||||
Interest-bearing demand deposits | $ | 10,422,286 | $ | 58,588 | 2.23 | % | $ | 10,114,171 | $ | 52,983 | 2.08 | % | $ | 8,627,386 | $ | 14,160 | 0.65 | % | |||||||||||
Money market accounts | 13,053,781 | 103,211 | 3.14 | 13,147,465 | 95,339 | 2.88 | 14,771,308 | 46,671 | 1.25 | ||||||||||||||||||||
Savings deposits | 1,098,914 | 275 | 0.10 | 1,178,322 | 280 | 0.09 | 1,450,153 | 176 | 0.05 | ||||||||||||||||||||
Time deposits | 7,198,229 | 75,462 | 4.16 | 6,180,584 | 59,972 | 3.85 | 2,567,979 | 7,648 | 1.18 | ||||||||||||||||||||
Brokered deposits | 6,069,055 | 81,444 | 5.32 | 6,442,690 | 83,486 | 5.14 | 4,986,542 | 39,500 | 3.14 | ||||||||||||||||||||
Federal funds purchased and securities sold under repurchase agreements | 93,854 | 350 | 1.46 | 73,344 | 296 | 1.58 | 141,707 | 437 | 1.21 | ||||||||||||||||||||
Other short-term borrowings | 2,672 | 51 | 7.50 | 1,722 | - | - | 660,295 | 6,383 | 3.78 | ||||||||||||||||||||
Long-term debt | 1,922,661 | 31,702 | 6.55 | 3,230,374 | 50,524 | 6.18 | 3,446,306 | 38,333 | 4.39 | ||||||||||||||||||||
Total interest-bearing liabilities | 39,861,452 | $ | 351,083 | 3.49 | % | 40,368,672 | $ | 342,880 | 3.37 | % | 36,651,676 | $ | 153,308 | 1.66 | % | ||||||||||||||
Non-interest-bearing demand deposits | 12,744,275 | 13,049,343 | 16,569,275 | ||||||||||||||||||||||||||
Other liabilities | 1,906,686 | 1,713,131 | 1,462,394 | ||||||||||||||||||||||||||
Shareholders' equity | 4,651,652 | 4,785,533 | 4,280,072 | ||||||||||||||||||||||||||
Total liabilities and shareholders' equity | $ | 59,164,065 | $ | 59,916,679 | $ | 58,963,417 | |||||||||||||||||||||||
Net interest income, taxable equivalent net interest margin (6) | $ | 438,430 | 3.11 | % | $ | 444,307 | 3.11 | % | $ | 502,477 | 3.56 | % | |||||||||||||||||
Less: taxable-equivalent adjustment | 1,216 | 1,148 | 1,131 | ||||||||||||||||||||||||||
Net interest income | $ | 437,214 | $ | 443,159 | $ | 501,346 | |||||||||||||||||||||||
| (1) | Average loans are shown net of deferred fees and costs. NPLs are included. |
| (2) | Interest income includes net loan fees as follows: Fourth Quarter 2023 - $13.1 million, Third Quarter 2023 - $11.8 million, and Fourth Quarter 2022 -$11.9 million. |
| (3) | Reflects taxable-equivalent adjustments, using the statutory federal tax rate of 21%, in adjusting interest on tax-exempt loans and investment securities to a taxable-equivalent basis. |
| (4) | Includes interest-bearing funds with Federal Reserve Bank, interest earning deposits with banks, and federal funds sold and securities purchased under resale agreements |
| (5) | Includes average net unrealized gains/(losses) on investment securities available for sale of $(1.89) billion, $(1.60) billion, and $(1.69) billion for the Fourth Quarter 2023, Third Quarter 2023, and Fourth Quarter 2022, respectively. |
| (6) | The net interest margin is calculated by dividing annualized net interest income-taxable equivalent by average total interest earning assets. |
Synovus | |||||||||||||||
LOANS OUTSTANDING BY TYPE | |||||||||||||||
(Unaudited) | |||||||||||||||
(Dollars in thousands) | |||||||||||||||
Total Loans | Total Loans | Linked Quarter | Total Loans | Year/Year | |||||||||||
Loan Type | December 31, 2023 | September 30, 2023 | % Change | December 31, 2022 | % Change | ||||||||||
Commercial, Financial, and Agricultural | $ | 14,459,345 | $ | 14,498,966 | - | % | $ | 13,874,416 | 4 | % | |||||
Owner-Occupied | 8,139,148 | 8,281,988 | (2 | ) | 8,192,240 | (1 | ) | ||||||||
Total Commercial & Industrial | 22,598,493 | 22,780,954 | (1 | ) | 22,066,656 | 2 | |||||||||
Multi-Family | 4,098,188 | 3,930,617 | 4 | 3,134,571 | 31 | ||||||||||
Hotels | 1,803,102 | 1,790,094 | 1 | 1,708,194 | 6 | ||||||||||
Office Buildings | 1,891,587 | 1,911,095 | (1 | ) | 3,011,911 | (37 | ) | ||||||||
Shopping Centers | 1,319,049 | 1,327,770 | (1 | ) | 1,403,928 | (6 | ) | ||||||||
Warehouses | 854,475 | 985,723 | (13 | ) | 1,035,152 | (17 | ) | ||||||||
Other Investment Property | 1,396,903 | 1,432,456 | (2 | ) | 1,350,291 | 3 | |||||||||
Total Investment Properties | 11,363,304 | 11,377,755 | - | 11,644,047 | (2 | ) | |||||||||
1-4 Family Construction | 194,481 | 224,091 | (13 | ) | 229,263 | (15 | ) | ||||||||
1-4 Family Investment Mortgage | 404,021 | 396,813 | 2 | 387,670 | 4 | ||||||||||
Total 1-4 Family Properties | 598,502 | 620,904 | (4 | ) | 616,933 | (3 | ) | ||||||||
Commercial Development | 73,022 | 64,212 | 14 | 79,889 | (9 | ) | |||||||||
Residential Development | 79,961 | 92,209 | (13 | ) | 108,661 | (26 | ) | ||||||||
Land Acquisition | 201,969 | 239,773 | (16 | ) | 200,783 | 1 | |||||||||
Land and Development | 354,952 | 396,194 | (10 | ) | 389,333 | (9 | ) | ||||||||
Total Commercial Real Estate | 12,316,758 | 12,394,853 | (1 | ) | 12,650,313 | (3 | ) | ||||||||
Consumer Mortgages | 5,411,723 | 5,391,282 | - | 5,214,443 | 4 | ||||||||||
Home Equity Lines | 1,807,399 | 1,784,356 | 1 | 1,757,038 | 3 | ||||||||||
Credit Cards | 194,141 | 191,046 | 2 | 203,612 | (5 | ) | |||||||||
Other Consumer Loans | 1,075,976 | 1,137,419 | (5 | ) | 1,824,291 | (41 | ) | ||||||||
Total Consumer | 8,489,239 | 8,504,103 | - | 8,999,384 | (6 | ) | |||||||||
Total | $ | 43,404,490 | $ | 43,679,910 | (1 | ) | $ | 43,716,353 | (1 | ) | |||||
NON-PERFORMING LOANS COMPOSITION | |||||||||||||||
(Unaudited) | |||||||||||||||
(Dollars in thousands) | |||||||||||||||
Total Non-performing
| Total Non-performing
| Linked Quarter | Total Non-performing
| Year/Year | |||||||||||
Loan Type | December 31, 2023 | September 30, 2023 | % Change | December 31, 2022 | % Change | ||||||||||
Commercial, Financial, and Agricultural | $ | 89,870 | $ | 97,468 | (8 | ) | $ | 59,307 | 52 | % | |||||
Owner-Occupied | 91,370 | 84,505 | 8 | 10,104 | nm | ||||||||||
Total Commercial & Industrial | 181,240 | 181,973 | - | 69,411 | 161 | ||||||||||
Multi-Family | 1,681 | 1,702 | (1 | ) | 1,857 | (9 | ) | ||||||||
Office Buildings | 35,338 | 27,810 | 27 | 309 | nm | ||||||||||
Shopping Centers | 641 | 653 | (2 | ) | 735 | (13 | ) | ||||||||
Warehouses | 196 | 207 | (5 | ) | 223 | (12 | ) | ||||||||
Other Investment Property | 1,914 | 572 | 235 | 349 | 448 | ||||||||||
Total Investment Properties | 39,770 | 30,944 | 29 | 3,473 | nm | ||||||||||
1-4 Family Construction | - | - | nm | 55 | (100 | ) | |||||||||
1-4 Family Investment Mortgage | 3,056 | 3,386 | (10 | ) | 3,067 | - | |||||||||
Total 1-4 Family Properties | 3,056 | 3,386 | (10 | ) | 3,122 | (2 | ) | ||||||||
Commercial Development | - | - | nm | - | nm | ||||||||||
Residential Development | 267 | 267 | - | 267 | - | ||||||||||
Land Acquisition | 537 | 538 | - | 891 | (40 | ) | |||||||||
Land and Development | 804 | 805 | - | 1,158 | (31 | ) | |||||||||
Total Commercial Real Estate | 43,630 | 35,135 | 24 | 7,753 | 463 | ||||||||||
Consumer Mortgages | 46,108 | 43,863 | 5 | 36,847 | 25 | ||||||||||
Home Equity Lines | 10,473 | 11,620 | (10 | ) | 6,830 | 53 | |||||||||
Other Consumer Loans | 6,726 | 7,941 | (15 | ) | 7,220 | (7 | ) | ||||||||
Total Consumer | 63,307 | 63,424 | - | 50,897 | 24 | ||||||||||
Total | $ | 288,177 | $ | 280,532 | 3 | % | $ | 128,061 | 125 | % | |||||
Synovus | ||||||||||||||||
CREDIT QUALITY DATA | ||||||||||||||||
(Unaudited) | ||||||||||||||||
(Dollars in thousands) | 2023 | 2022 | Fourth | |||||||||||||
Quarter | ||||||||||||||||
Fourth | Third | Second | First | Fourth | 23 vs '22 | |||||||||||
Quarter | Quarter | Quarter | Quarter | Quarter | % Change | |||||||||||
Non-performing Loans (NPL) | $ | 288,177 | 280,532 | 261,506 | 182,460 | 128,061 | 125 | % | ||||||||
Other Real Estate and Other Assets | - | - | - | - | 15,320 | (100 | ) | |||||||||
Non-performing Assets (NPAs) | 288,177 | 280,532 | 261,506 | 182,460 | 143,381 | 101 | ||||||||||
Allowance for Loan Losses (ALL) | 479,385 | 477,532 | 471,238 | 457,010 | 443,424 | 8 | ||||||||||
Reserve for Unfunded Commitments | 57,230 | 55,185 | 55,729 | 57,473 | 57,455 | - | ||||||||||
Allowance for Credit Losses (ACL) | 536,615 | 532,717 | 526,967 | 514,483 | 500,879 | 7 | ||||||||||
Net Charge-Offs - Quarter | 41,574 | 66,822 | 26,396 | 18,550 | 13,300 | |||||||||||
Net Charge-Offs - YTD | 153,342 | 111,768 | 44,946 | 18,550 | 53,156 | |||||||||||
Net Charge-Offs / Average Loans - Quarter (1) | 0.38 | % | 0.61 | 0.24 | 0.17 | 0.12 | ||||||||||
Net Charge-Offs / Average Loans - YTD (1) | 0.35 | 0.34 | 0.20 | 0.17 | 0.13 | |||||||||||
NPLs / Loans | 0.66 | 0.64 | 0.59 | 0.41 | 0.29 | |||||||||||
NPAs / Loans, ORE and specific other assets | 0.66 | 0.64 | 0.59 | 0.41 | 0.33 | |||||||||||
ACL/Loans | 1.24 | 1.22 | 1.19 | 1.17 | 1.15 | |||||||||||
ALL/Loans | 1.10 | 1.09 | 1.06 | 1.04 | 1.01 | |||||||||||
ACL/NPLs | 186.21 | 189.90 | 201.51 | 281.97 | 391.13 | |||||||||||
ALL/NPLs | 166.35 | 170.22 | 180.20 | 250.47 | 346.26 | |||||||||||
Past Due Loans over 90 days and Still Accruing | $ | 5,053 | 3,792 | 3,643 | 3,529 | 3,373 | 50 | |||||||||
As a Percentage of Loans Outstanding | 0.01 | % | 0.01 | 0.01 | 0.01 | 0.01 | ||||||||||
Total Past Due Loans and Still Accruing | $ | 59,099 | 54,974 | 84,946 | 55,053 | 65,568 | (10 | ) | ||||||||
As a Percentage of Loans Outstanding | 0.14 | % | 0.13 | 0.19 | 0.12 | 0.15 | ||||||||||
(1) Ratio is annualized. | ||||||||||||||||
SELECTED CAPITAL INFORMATION (1) | ||||||||||||||||
(Unaudited) | ||||||||||||||||
(Dollars in thousands) | ||||||||||||||||
December 31,
| September 30,
| December 31,
| ||||||||||||||
Common Equity Tier 1 Capital Ratio | 10.22 | % | 10.13 | 9.63 | ||||||||||||
Tier 1 Capital Ratio | 11.28 | 11.18 | 10.68 | |||||||||||||
Total Risk-Based Capital Ratio | 13.07 | 13.12 | 12.54 | |||||||||||||
Tier 1 Leverage Ratio | 9.49 | 9.38 | 9.07 | |||||||||||||
Total Synovus Financial Corp. shareholders' equity as a Percentage of Total Assets | 8.56 | 7.65 | 7.49 | |||||||||||||
Tangible Common Equity Ratio(2)(4) | 6.84 | 5.90 | 5.84 | |||||||||||||
Book Value Per Common Share(3) | $ | 31.24 | 27.36 | 27.07 | ||||||||||||
Tangible Book Value Per Common Share(2) | 27.65 | 23.74 | 23.78 | |||||||||||||
(1) Current quarter regulatory capital information is preliminary. | ||||||||||||||||
(2) Excludes the carrying value of goodwill and other intangible assets from common equity and total assets. | ||||||||||||||||
(3) Book Value Per Common Share consists of Total Synovus Financial Corp. shareholders' equity less Preferred Stock divided by total common shares outstanding. | ||||||||||||||||
(4) See "Non-GAAP Financial Measures" for applicable reconciliation. | ||||||||||||||||
Contacts
Media Contact
Audria Belton
Media Relations
media@synovus.com
Investor Contact
Jennifer H. Demba, CFA
Investor Relations
investorrelations@synovus.com
