SOURCE: Fulton Financial Corporation

Fulton Financial Corporation

January 19, 2016 16:30 ET

Fulton Financial Reports 2015 Earnings

LANCASTER, PA--(Marketwired - Jan 19, 2016) - Fulton Financial Corporation (NASDAQ: FULT)

  • Diluted earnings per share for the fourth quarter of 2015 was 22 cents, compared to 20 cents in the third quarter of 2015 and 21 cents in the fourth quarter of 2014. For the year ended December 31, 2015, diluted earnings per share was 85 cents, a 1.2 percent increase from 84 cents in 2014.
  • Net interest income for the fourth quarter of 2015 increased $2.1 million, or 1.7 percent, compared to the third quarter of 2015, while the net interest margin increased one basis point to 3.19 percent. For the year ended December 31, 2015, net interest income decreased $14.9 million, or 2.9 percent, compared to 2014, while the net interest margin decreased 18 basis points to 3.21 percent.
  • Loans at December 31, 2015 increased $302.2 million, or 2.2 percent, compared to September 30, 2015 and $726.9 million, or 5.5 percent, compared to December 31, 2014. Average loans for the fourth quarter of 2015 increased 2.2 percent and 4.6 percent, compared to the third quarter of 2015 and the fourth quarter of 2014, respectively. For the year ended December 31, 2015, average loans increased $445.8 million, or 3.5 percent, compared to 2014.
  • Deposits at December 31, 2015 increased $47.9 million, or 0.3 percent, compared to September 30, 2015 and $764.8 million, or 5.7 percent, compared to the December 31, 2014. Average deposits for the fourth quarter of 2015 increased 2.3 percent and 6.6 percent, compared to the third quarter of 2015 and the fourth quarter of 2014, respectively. For the year ended December 31, 2015, average deposits increased $879.5 million, or 6.8 percent, compared to 2014.
  • The provision for credit losses in the fourth quarter of 2015 was $2.8 million, compared to a $1.0 million provision in the third quarter of 2015 and a $3.0 million provision in the fourth quarter of 2014. For the year ended December 31, 2015, the provision for credit losses was $2.3 million, a decrease of $10.3 million from 2014.
  • Non-interest income, excluding investment securities gains, increased $2.0 million, or 4.7 percent, in comparison to the third quarter of 2015, and increased $3.8 million, or 9.2 percent, in comparison to the fourth quarter of 2014. For the year ended December 31, 2015, noninterest income, excluding investment securities gains, increased $7.4 million, or 4.5 percent.
  • Non-interest expense, excluding the loss on redemption of trust preferred securities, decreased $824,000, or 0.7 percent, compared to the third quarter of 2015 and increased $719,000, or 0.6 percent, compared to the fourth quarter of 2014. For the year ended December 31, 2015, noninterest expense, excluding the loss on redemption of trust preferred securities, increased $15.3 million, or 3.3%, compared to 2014.

Fulton Financial Corporation (NASDAQ: FULT) reported net income of $38.5 million, or 22 cents per diluted share, for the fourth quarter of 2015, and net income of $149.5 million, or 85 cents per diluted share, for 2015.

"We are pleased with the increasing momentum that developed in the latter half of 2015, which enabled us to finish the year with strong commercial loan, core deposit and fee income growth," said E. Philip Wenger, Chairman, President and CEO. "We believe the investments we are making in our talent and infrastructure, coupled with expectations for a generally improving business environment and changes in the competitive landscape in a number of our markets, position us to drive meaningful growth and generate positive operating leverage in 2016."

Net Interest Income and Margin
Net interest income for the fourth quarter of 2015 increased $2.1 million, or 1.7 percent, from the third quarter of 2015. Net interest margin increased one basis point, or 0.3 percent, to 3.19 percent in the fourth quarter of 2015, from 3.18 percent in the third quarter of 2015. The average yield on interest-earning assets decreased one basis point, while the average cost of interest-bearing liabilities decreased three basis points during the fourth quarter of 2015 in comparison to the third quarter of 2015.

For the year ended December 31, 2015, net interest income decreased $14.9 million, or 2.9 percent, from 2014. Net interest margin decreased 18 basis points, or 5.3 percent, to 3.21 percent. The average yield on interest-earnings assets decreased 18 basis points, while the average cost of interest-bearing liabilities increased two basis points from 2014.

Average Balance Sheet
Total average assets for the fourth quarter of 2015 were $17.8 billion, an increase of $254.4 million from the third quarter of 2015. Average loans, net of unearned income, increased $289.4 million, or 2.2 percent, in comparison to the third quarter of 2015. Average loans and yields, by type, for the fourth quarter of 2015 in comparison to the third quarter of 2015, are summarized in the following table:

             
             
    Three Months Ended     Increase (decrease)  
    December 31, 2015     September 30, 2015     in Balance  
    Balance   Yield (1)     Balance   Yield (1)     $     %  
    (dollars in thousands)  
Average Loans, net of unearned income, by type:                                      
  Real estate - commercial mortgage   $ 5,365,640   4.05 %   $ 5,242,021   4.09 %   $ 123,619     2.4 %
  Commercial - industrial, financial and agricultural     4,035,287   3.74 %     3,887,161   3.78 %     148,126     3.8 %
  Real estate - home equity     1,694,455   4.07 %     1,692,860   4.08 %     1,595     0.1 %
  Real estate - residential mortgage     1,377,116   3.79 %     1,381,141   3.78 %     (4,025 )   (0.3 %)
  Real estate - construction     765,555   3.75 %     753,584   3.88 %     11,971     1.6 %
  Consumer     267,726   5.72 %     270,391   5.81 %     (2,665 )   (1.0 %)
  Leasing and other     153,487   5.31 %     142,716   6.79 %     10,771     7.5 %
                                       
  Total Average Loans, net of unearned income   $ 13,659,266   3.96 %   $ 13,369,874   4.02 %   $ 289,392     2.2 %
                                       
    (1) Presented on a fully-taxable equivalent basis using a 35% Federal tax rate and statutory interest expense disallowances.
   
   

For the year ended December 31, 2015, average loans increased $445.8 million, or 3.5 percent, in comparison to 2014.

Total average liabilities increased $240.5 million, or 1.6 percent, from the third quarter of 2015, including a $319.7 million, or 2.3 percent, increase in average deposits. Average deposits and interest rates, by type, for the fourth quarter of 2015 in comparison to the third quarter of 2015, are summarized in the following table:

             
             
    Three Months Ended     Increase (decrease)  
    December 31, 2015     September 30, 2015     in Balance  
    Balance   Rate     Balance   Rate     $     %  
    (dollars in thousands)        
Average Deposits, by type:                                      
  Noninterest-bearing demand   $ 3,999,118   - %   $ 3,904,176   - %   $ 94,942     2.4 %
  Interest-bearing demand     3,411,904   0.13 %     3,316,532   0.13 %     95,372     2.9 %
  Savings deposits     3,903,741   0.17 %     3,714,282   0.15 %     189,459     5.1 %
Total average demand and savings     11,314,763   0.10 %     10,934,990   0.09 %     379,773     3.5 %
  Time deposits     2,903,715   1.03 %     2,963,774   1.03 %     (60,059 )   (2.0 %)
                                       
  Total Average Deposits   $ 14,218,478   0.29 %   $ 13,898,764   0.29 %   $ 319,714     2.3 %
                                         
                                         

For the year ended December 31, 2015, average deposits increased $879.5 million, or 6.8 percent, in comparison to 2014.

Asset Quality
Non-performing assets were $155.9 million, or 0.87 percent of total assets, at December 31, 2015, compared to $155.6 million, or 0.87 percent of total assets, at September 30, 2015 and $150.5 million, or 0.88 percent of total assets, at December 31, 2014.

Annualized net charge-offs for the quarter ended December 31, 2015 were 0.02 percent of total average loans, compared to 0.03 percent for the quarter ended September 30, 2015 and 0.25 percent for the quarter ended December 31, 2014. The allowance for credit losses as a percentage of non-performing loans was 118.4 percent at December 31, 2015, as compared to 116.8 percent at September 30, 2015 and 134.3 percent at December 31, 2014.

During the fourth quarter of 2015, the Corporation recorded a $2.8 million provision for credit losses, compared to a $1.0 million provision for credit losses in the third quarter of 2015.

Non-interest Income
Non-interest income, excluding investment securities gains, increased $2.0 million, or 4.7 percent, in comparison to the third quarter of 2015. Other service charges increased $1.7 million, or 15.6 percent, due to increases in commercial loan interest rate swap fees and debit card income. Mortgage banking income increased $453,000, or 11.7 percent, due to higher servicing income.

For the year ended December 31, 2015, non-interest income, excluding investment securities gains, increased $7.4 million, or 4.5 percent, in comparison to 2014. This increase was primarily driven by increases in commercial loan interest rate swap fees, merchant fees, and mortgage banking income.

Gains on sales of investment securities decreased $954,000 in comparison to the third quarter of 2015. For the year ended December 31, 2015, gains on sales of investment securities increased $7.0 million compared to 2014.

Non-interest Expense
Non-interest expense decreased $6.5 million, or 5.2 percent, in the fourth quarter of 2015, compared to the third quarter of 2015. In the third quarter of 2015, the Corporation incurred a $5.6 million loss on the redemption of trust preferred securities. Excluding this loss, non-interest expense decreased $824,000, or 0.7 percent, in the fourth quarter, compared to the third quarter 2015.

For the year ended December 31, 2015, non-interest expense increased $20.9 million, or 4.6 percent, compared to 2014. This increase was primarily due to higher salaries and benefits, data processing and software expenses. Also contributing to the increase was the $5.6 million loss on the redemption of trust preferred securities.

About Fulton Financial
Fulton Financial Corporation is a Lancaster, Pennsylvania-based financial holding company that has banking offices in Pennsylvania, Maryland, Delaware, New Jersey and Virginia through the following affiliates, headquartered as indicated: Fulton Bank, N.A., Lancaster, PA; Swineford National Bank, Middleburg, PA; Lafayette Ambassador Bank, Bethlehem, PA; FNB Bank, N.A., Danville, PA; Fulton Bank of New Jersey, Mt. Laurel, NJ; and The Columbia Bank, Columbia, MD.

The Corporation's investment management and trust services are offered at all banks through Fulton Financial Advisors, a division of Fulton Bank, N.A. Residential mortgage lending is offered by all banks under the Fulton Mortgage Company brand.

Additional information on Fulton Financial Corporation is available on the Internet at www.fult.com.

Safe Harbor Statement
This news release may contain forward-looking statements with respect to the Corporation's financial condition, results of operations and business. Do not unduly rely on forward-looking statements. Forward-looking statements can be identified by the use of words such as "may," "should," "will," "could," "estimates," "predicts," "potential," "continue," "anticipates," "believes," "plans," "expects," "future," "intends" and similar expressions which are intended to identify forward-looking statements. These forward-looking statements are not guarantees of future performance and are subject to risks and uncertainties, some of which are beyond the Corporation's control and ability to predict, that could cause actual results to differ materially from those expressed in the forward-looking statements.

A discussion of certain risks and uncertainties affecting the Corporation, and some of the factors that could cause the Corporation's actual results to differ materially from those described in the forward-looking statements, can be found in the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Corporation's Annual Report on Form 10-K for the year ended December 31, 2014 and Quarterly Reports on Form 10-Q for the quarters ended March 31, 2015, June 30, 2015 and September 30, 2015, which have been filed with the Securities and Exchange Commission and are available in the Investor Relations section of the Corporation's website (www.fult.com) and on the Securities and Exchange Commission's website (www.sec.gov). The Corporation undertakes no obligation, other than as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Non-GAAP Financial Measures

The Corporation uses certain non-GAAP financial measures in this earnings release. These non-GAAP financial measures are reconciled to the most comparable GAAP measures in tables at the end of this release.

   
   
FULTON FINANCIAL CORPORATION  
CONDENSED CONSOLIDATED ENDING BALANCE SHEETS (UNAUDITED)  
dollars in thousands  
                      % Change from  
    December 31     December 31     September 30     December 31     September 30  
    2015     2014     2015     2014     2015  
                                     
ASSETS                                    
  Cash and due from banks   $ 101,120     $ 105,702     $ 93,803     (4.3 %)   7.8 %
  Other interest-earning assets     292,516       423,083       579,920     (30.9 %)   (49.6 %)
  Loans held for sale     16,886       17,522       26,937     (3.6 %)   (37.3 %)
  Investment securities     2,484,773       2,323,371       2,436,337     6.9 %   2.0 %
  Loans, net of unearned income     13,838,602       13,111,716       13,536,361     5.5 %   2.2 %
  Allowance for loan losses     (169,054 )     (184,144 )     (167,136 )   (8.2 %)   1.1 %
    Net loans     13,669,548       12,927,572       13,369,225     5.7 %   2.2 %
  Premises and equipment     225,535       226,027       225,705     (0.2 %)   (0.1 %)
  Accrued interest receivable     42,767       41,818       42,846     2.3 %   (0.2 %)
  Goodwill and intangible assets     531,556       531,803       531,562     (0.0 %)   (0.0 %)
  Other assets     550,017       527,869       531,724     4.2 %   3.4 %
      Total Assets   $ 17,914,718     $ 17,124,767     $ 17,838,059     4.6 %   0.4 %
                                     
LIABILITIES AND SHAREHOLDERS' EQUITY                                        
  Deposits   $ 14,132,317     $ 13,367,506     $ 14,084,394     5.7 %   0.3 %
  Short-term borrowings     497,663       329,719       431,631     50.9 %   15.3 %
  Other liabilities     293,302       291,464       316,697     0.6 %   (7.4 %)
  FHLB advances and long-term debt     949,542       1,139,413       979,433     (16.7 %)   (3.1 %)
    Total Liabilities     15,872,824       15,128,102       15,812,155     4.9 %   0.4 %
  Shareholders' equity     2,041,894       1,996,665       2,025,904     2.3 %   0.8 %
    Total Liabilities and Shareholders' Equity   $ 17,914,718     $ 17,124,767     $ 17,838,059     4.6 %   0.4 %
                                     
LOANS, DEPOSITS AND SHORT-TERM BORROWINGS DETAIL:                                        
  Loans, by type:                                    
  Real estate - commercial mortgage   $ 5,462,330     $ 5,197,155     $ 5,339,928     5.1 %   2.3 %
  Commercial - industrial, financial and agricultural     4,088,962       3,725,567       3,929,908     9.8 %   4.0 %
  Real estate - home equity     1,684,439       1,736,688       1,693,649     (3.0 %)   (0.5 %)
  Real estate - residential mortgage     1,376,160       1,377,068       1,382,085     (0.1 %)   (0.4 %)
  Real estate - construction     799,988       690,601       769,565     15.8 %   4.0 %
  Consumer     268,588       265,431       271,696     1.2 %   (1.1 %)
  Leasing and other     158,135       119,206       149,530     32.7 %   5.8 %
  Total Loans, net of unearned income   $ 13,838,602     $ 13,111,716     $ 13,536,361     5.5 %   2.2 %
                                     
Deposits, by type:                                    
  Noninterest-bearing demand   $ 3,948,114     $ 3,640,623     $ 3,906,228     8.4 %   1.1 %
  Interest-bearing demand     3,451,207       3,150,612       3,362,336     9.5 %   2.6 %
  Savings deposits     3,868,046       3,504,820       3,880,103     10.4 %   (0.3 %)
  Time deposits     2,864,950       3,071,451       2,935,727     (6.7 %)   (2.4 %)
  Total Deposits   $ 14,132,317     $ 13,367,506     $ 14,084,394     5.7 %   0.3 %
                                     
Short-term borrowings, by type:                                    
  Customer repurchase agreements   $ 111,496     $ 158,394     $ 145,225     (29.6 %)   (23.2 %)
  Customer short-term promissory notes     78,932       95,106       80,879     (17.0 %)   (2.4 %)
  Short-term FHLB advances     110,000       70,000       200,000     57.1 %   (45.0 %)
  Federal funds purchased     197,235       6,219       5,527     N/M     N/M  
  Total Short-term Borrowings   $ 497,663     $ 329,719     $ 431,631     50.9 %   15.3 %
                                     
                                     
 
 
FULTON FINANCIAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
in thousands, except per-share data and percentages
 
    Three Months Ended     % Change from    Year Ended        
    Dec 31     Dec 31     Sep 30     Dec 31    Sep 30    Dec 31        
    2015     2014     2015     2014    2015    2015     2014     % Change  
                                                           
Interest Income:                                                          
  Interest income   $ 147,560     $ 149,594     $ 146,228     (1.4 %)   0.9 %   $ 583,789     $ 596,078     (2.1 %)
  Interest expense     19,761       21,556       20,534     (8.3 %)   (3.8 %)     83,795       81,211     3.2 %
    Net Interest Income     127,799       128,038       125,694     (0.2 %)   1.7 %     499,994       514,867     (2.9 %)
  Provision for credit losses     2,750       3,000       1,000     (8.3 %)   175.0 %     2,250       12,500     N/M  
    Net Interest Income after Provision     125,049       125,038       124,694     0.0 %   0.3 %     497,744       502,367     (0.9 %)
Non-Interest Income:                                                          
  Service charges on deposit accounts     12,909       12,229       12,982     5.6 %   (0.6 %)     50,097       49,293     1.6 %
  Other service charges and fees     12,676       10,489       10,965     20.9 %   15.6 %     43,992       39,896     10.3 %
  Investment management and trust services     10,919       11,188       11,237     (2.4 %)   (2.8 %)     44,056       44,605     (1.2 %)
  Mortgage banking income     4,317       3,723       3,864     16.0 %   11.7 %     18,208       17,107     6.4 %
  Investment securities gains     776       848       1,730     (8.5 %)   (55.1 %)     9,066       2,041     N/M  
  Other     4,242       3,624       3,996     17.1 %   6.2 %     16,420       14,437     13.7 %
    Total Non-Interest Income     45,839       42,101       44,774     8.9 %   2.4 %     181,839       167,379     8.6 %
Non-Interest Expense:                                                          
  Salaries and employee benefits     65,467       65,398       65,308     0.1 %   0.2 %     260,832       251,021     3.9 %
  Net occupancy expense     11,566       11,481       10,710     0.7 %   8.0 %     47,777       48,130     (0.7 %)
  Other outside services     6,537       8,720       7,373     (25.0 %)   (11.3 %)     27,785       28,404     (2.2 %)
  Data processing     5,127       4,346       5,105     18.0 %   0.4 %     19,894       17,162     15.9 %
  Software     4,068       3,271       3,984     24.4 %   2.1 %     14,746       12,758     15.6 %
  Equipment expense     3,626       3,298       3,595     9.9 %   0.9 %     14,514       13,567     7.0 %
  FDIC insurance expense     2,896       2,772       2,867     4.5 %   1.0 %     11,470       10,958     4.7 %
  Professional fees     2,814       2,382       2,828     18.1 %   (0.5 %)     11,244       12,097     (7.1 %)
  Marketing     1,754       2,414       2,102     (27.3 %)   (16.6 %)     7,324       8,133     (9.9 %)
  Other real estate owned and repossession expense     1,123       236       1,016     N/M     10.5 %     3,630       3,270     11.0 %
  Operating risk loss     987       485       1,136     N/M     (13.1 %)     3,624       4,271     (15.1 %)
  Intangible amortization     6       315       5     (98.1 %)   20.0 %     247       1,259     (80.4 %)
  Loss on redemption of trust preferred securities     -       -       5,626     N/M     N/M       5,626       -     N/M  
  Other     12,468       12,602       13,234     (1.1 %)   (5.8 %)     51,447       48,216     6.7 %
    Total Non-Interest Expense     118,439       117,720       124,889     0.6 %   (5.2 %)     480,160       459,246     4.6 %
    Income Before Income Taxes     52,449       49,419       44,579     6.1 %   17.7 %     199,423       210,500     (5.3 %)
  Income tax expense     13,914       11,470       10,328     21.3 %   34.7 %     49,921       52,606     (5.1 %)
    Net Income   $ 38,535     $ 37,949     $ 34,251     1.5 %   12.5 %   $ 149,502     $ 157,894     (5.3 %)
                                                           
                                                           
PER SHARE:                                                          
                                                           
  Net income:                                                          
    Basic   $ 0.22     $ 0.21     $ 0.20     4.8 %   10.0 %   $ 0.85     $ 0.85     -  
    Diluted     0.22       0.21       0.20     4.8 %   10.0 %     0.85       0.84     1.2 %
                                                           
  Cash dividends   $ 0.09     $ 0.10     $ 0.09     (10.0 %)   -     $ 0.36     $ 0.34     5.9 %
  Shareholders' equity     11.72       11.16       11.66     5.0 %   0.5 %     11.72       11.16     5.0 %
  Shareholders' equity (tangible)     8.67       8.19       8.60     5.9 %   0.8 %     8.67       8.19     5.9 %
                                                           
  Weighted average shares (basic)     173,709       181,251       174,338     (4.2 %)   (0.4 %)     175,721       186,219     (5.6 %)
  Weighted average shares (diluted)     174,833       182,189       175,342     (4.0 %)   (0.3 %)     176,774       187,181     (5.6 %)
  Shares outstanding, end of period     174,176       178,924       173,771     (2.7 %)   0.2 %     174,176       178,924     (2.7 %)
                                                           
SELECTED FINANCIAL RATIOS:                                                          
                                                           
  Return on average assets     0.86 %     0.88 %     0.78 %                 0.86 %     0.93 %      
  Return on average shareholders' equity     7.51 %     7.34 %     6.72 %                 7.38 %     7.62 %      
  Return on average shareholders' equity (tangible)     10.16 %     9.96 %     9.11 %                 10.01 %     10.31 %      
  Net interest margin     3.19 %     3.31 %     3.18 %                 3.21 %     3.39 %      
  Efficiency ratio     66.63 %     67.53 %     68.82 %                 68.61 %     65.65 %      
                                                           
N/M - Not meaningful                                                          
                                                           
                               
 
 
FULTON FINANCIAL CORPORATION
CONDENSED CONSOLIDATED AVERAGE BALANCE SHEET ANALYSIS (UNAUDITED)
dollars in thousands
 
    Three Months Ended  
    December 31, 2015     December 31, 2014     September 30, 2015  
    Average         Yield/      Average           Yield/      Average           Yield/ 
    Balance   Interest (1)     Rate     Balance     Interest (1)     Rate     Balance     Interest (1)     Rate  
ASSETS                                                                
                                                                 
Interest-earning assets:                                                                
  Loans, net of unearned income   $ 13,659,266   $ 136,317     3.96 %   $ 13,056,153     $ 136,636     4.16 %   $ 13,369,874     $ 135,268     4.02 %
  Taxable investment securities     2,170,397     11,801     2.17 %     2,109,884       12,689     2.40 %     2,148,403       11,252     2.09 %
  Tax-exempt investment securities     246,727     3,085     5.00 %     241,711       3,249     5.38 %     230,178       2,929     5.09 %
  Equity securities     15,524     208     5.33 %     33,981       442     5.16 %     18,280       257     5.58 %
  Total Investment Securities     2,432,648     15,094     2.48 %     2,385,576       16,380     2.74 %     2,396,861       14,438     2.41 %
  Loans held for sale     15,713     169     4.31 %     15,340       201     5.24 %     20,704       194     3.74 %
  Other interest-earning assets     399,309     864     0.86 %     464,342       953     0.82 %     477,145       884     0.74 %
  Total Interest-earning Assets     16,506,936     152,444     3.67 %     15,921,411       154,170     3.85 %     16,264,584       150,784     3.68 %
Noninterest-earning assets:                                                                
  Cash and due from banks     106,810                   110,292                     104,622                
  Premises and equipment     226,335                   224,516                     226,446                
  Other assets     1,108,094                   1,073,302                     1,097,600                
  Less: allowance for loan losses     (169,251)                   (189,029 )                   (168,770 )              
  Total Assets   $ 17,778,924                 $ 17,140,492                   $ 17,524,482                
                                                                 
LIABILITIES AND SHAREHOLDERS' EQUITY                                                                
Interest-bearing liabilities:                                                                
  Demand deposits   $ 3,411,904   $ 1,207     0.13 %   $ 3,145,658     $ 1,027     0.13 %   $ 3,316,532     $ 1,122     0.13 %
  Savings deposits     3,903,741     1,633     0.17 %     3,548,504       1,171     0.13 %     3,714,282       1,436     0.15 %
  Time deposits     2,903,715     7,549     1.03 %     3,016,834       7,333     0.96 %     2,963,774       7,659     1.03 %
  Total Interest-bearing Deposits     10,219,360     10,389     0.40 %     9,710,996       9,531     0.39 %     9,994,588       10,217     0.41 %
  Short-term borrowings     281,497     100     0.14 %     417,838       138     0.13 %     324,685       92     0.11 %
  FHLB advances and long-term debt     950,792     9,272     3.88 %     1,086,321       11,887     4.36 %     996,247       10,225     4.09 %
  Total Interest-bearing Liabilities     11,451,649     19,761     0.69 %     11,215,155       21,556     0.76 %     11,315,520       20,534     0.72 %
Noninterest-bearing liabilities:                                                                
  Demand deposits     3,999,118                   3,630,780                     3,904,176                
  Other     291,388                   242,346                     281,957                
  Total Liabilities     15,742,155                   15,088,281                     15,501,653                
  Shareholders' equity     2,036,769                   2,052,211                     2,022,829                
  Total Liabilities and Shareholders' Equity   $ 17,778,924                 $ 17,140,492                   $ 17,524,482                
  Net interest income/net interest margin (fully taxable equivalent)     132,683     3.19 %             132,614     3.31 %             130,250     3.18 %
  Tax equivalent adjustment           (4,884 )                   (4,576 )                   (4,556 )      
  Net interest income         $ 127,799                   $ 128,038                   $ 125,694        
                                                                 
(1) Presented on a tax-equivalent basis using a 35% Federal tax rate and statutory interest expense disallowances.
 
 
                         
                         
AVERAGE LOANS, DEPOSITS AND SHORT-TERM BORROWINGS DETAIL:  
                         
    Three Months Ended   % Change from  
    December 31   December 31   September 30   December 31    September 30 
    2015   2014   2015   2014    2015 
                               
Loans, by type:                              
  Real estate - commercial mortgage   $ 5,365,640   $ 5,131,375   $ 5,242,021   4.6 %   2.4 %
  Commercial - industrial, financial and agricultural     4,035,287     3,723,211     3,887,161   8.4 %   3.8 %
  Real estate - home equity     1,694,455     1,735,769     1,692,860   (2.4 %)   0.1 %
  Real estate - residential mortgage     1,377,116     1,378,452     1,381,141   (0.1 %)   (0.3 %)
  Real estate - construction     765,555     697,741     753,584   9.7 %   1.6 %
  Consumer     267,726     275,349     270,391   (2.8 %)   (1.0 %)
  Leasing and other     153,487     114,256     142,716   34.3 %   7.5 %
                               
  Total Loans, net of unearned income   $ 13,659,266   $ 13,056,153   $ 13,369,874   4.6 %   2.2 %
                               
Deposits, by type:                              
  Noninterest-bearing demand   $ 3,999,118   $ 3,630,780   $ 3,904,176   10.1 %   2.4 %
  Interest-bearing demand     3,411,904     3,145,658     3,316,532   8.5 %   2.9 %
  Savings deposits     3,903,741     3,548,504     3,714,282   10.0 %   5.1 %
  Time deposits     2,903,715     3,016,834     2,963,774   (3.7 %)   (2.0 %)
                               
  Total Deposits   $ 14,218,478   $ 13,341,776   $ 13,898,764   6.6 %   2.3 %
                               
Short-term borrowings, by type:                              
  Customer repurchase agreements   $ 142,004   $ 183,331   $ 149,415   (22.5 %)   (5.0 %)
  Customer short-term promissory notes     80,568     87,338     79,308   (7.8 %)   1.6 %
  Federal funds purchased     44,468     59,669     85,092   (25.5 %)   (47.7 %)
  Short-term FHLB advances and other borrowings     14,457     87,500     10,870   (83.5 %)   33.0 %
                               
  Total Short-term Borrowings   $ 281,497   $ 417,838   $ 324,685   (32.6 %)   (13.3 %)
                                 
                                 
 
 
FULTON FINANCIAL CORPORATION
CONDENSED CONSOLIDATED AVERAGE BALANCE SHEET ANALYSIS (UNAUDITED)
dollars in thousands
 
   
    Year Ended December 31  
    2015         2014      
    Average             Average          
    Balance   Interest (1)   Yield/Rate     Balance   Interest (1)   Yield/Rate  
ASSETS                                    
                                     
Interest-earning assets:                                    
  Loans, net of unearned income   $ 13,330,973   $ 537,979   4.04 %   $ 12,885,180   $ 542,540   4.21 %
  Taxable investment securities     2,093,829     45,279   2.16 %     2,189,510     50,651   2.31 %
  Tax-exempt investment securities     230,633     12,120   5.26 %     261,825     13,810   5.27 %
  Equity securities     23,348     1,294   5.54 %     33,957     1,728   5.09 %
  Total Investment Securities     2,347,810     58,693   2.50 %     2,485,292     66,189   2.66 %
  Loans held for sale     19,937     801   4.02 %     17,524     786   4.49 %
  Other interest-earning assets     447,354     4,786   1.07 %     314,345     4,018   1.28 %
  Total Interest-earning Assets     16,146,074     602,259   3.73 %     15,702,341     613,533   3.91 %
Noninterest-earning assets:                                    
  Cash and due from banks     105,359                 177,664            
  Premises and equipment     226,436                 224,903            
  Other assets     1,103,427                 1,049,765            
  Less: allowance for loan losses     (174,453 )               (195,166 )          
  Total Assets   $ 17,406,843               $ 16,959,507            
                                     
LIABILITIES AND SHAREHOLDERS' EQUITY                                    
Interest-bearing liabilities:                                    
  Demand deposits   $ 3,255,192   $ 4,299   0.13 %   $ 3,013,879   $ 3,793   0.13 %
  Savings deposits     3,677,079     5,435   0.15 %     3,431,957     4,298   0.13 %
  Time deposits     2,988,648     30,748   1.03 %     2,992,920     27,019   0.90 %
  Total Interest-bearing Deposits     9,920,919     40,482   0.41 %     9,438,756     35,110   0.37 %
  Short-term borrowings     323,772     372   0.11 %     832,839     1,608   0.19 %
  FHLB advances and long-term debt     1,023,972     42,941   4.19 %     965,601     44,493   4.61 %
  Total Interest-bearing Liabilities     11,268,663     83,795   0.74 %     11,237,196     81,211   0.72 %
Noninterest-bearing liabilities:                                    
  Demand deposits     3,826,194                 3,428,907            
  Other     285,103                 221,764            
  Total Liabilities     15,379,960                 14,887,867            
  Shareholders' equity     2,026,883                 2,071,640            
  Total Liabilities and Shareholders' Equity   $ 17,406,843               $ 16,959,507            
  Net interest income/net interest margin (fully taxable equivalent)     518,464   3.21 %           532,322   3.39 %
  Tax equivalent adjustment           (18,470 )               (17,455 )    
  Net interest income         $ 499,994               $ 514,867      
                                     
 
(1) Presented on a tax-equivalent basis using a 35% Federal tax rate and statutory interest expense disallowances.
 
 
   
   
AVERAGE LOANS, DEPOSITS AND SHORT-TERM BORROWINGS DETAIL:  
               
    Year Ended      
    December 31      
    2015   2014   % Change  
                   
Loans, by type:                  
  Real estate - commercial mortgage   $ 5,246,054   $ 5,117,433   2.5 %
  Commercial - industrial, financial and agricultural     3,882,998     3,659,059   6.1 %
  Real estate - home equity     1,700,851     1,738,449   (2.2 %)
  Real estate - residential mortgage     1,371,321     1,355,876   1.1 %
  Real estate - construction     726,914     631,968   15.0 %
  Consumer     265,688     277,853   (4.4 %)
  Leasing and other     137,147     104,542   31.2 %
                   
  Total Loans, net of unearned income   $ 13,330,973   $ 12,885,180   3.5 %
                   
Deposits, by type:                  
  Noninterest-bearing demand   $ 3,826,194   $ 3,428,907   11.6 %
  Interest-bearing demand     3,255,192     3,013,879   8.0 %
  Savings deposits     3,677,079     3,431,957   7.1 %
  Time deposits     2,988,648     2,992,920   (0.1 %)
                   
  Total Deposits   $ 13,747,113   $ 12,867,663   6.8 %
                   
Short-term borrowings, by type:                  
  Customer repurchase agreements   $ 161,093   $ 197,432   (18.4 %)
  Customer short-term promissory notes     81,530     88,670   (8.1 %)
  Federal funds purchased     65,779     285,169   (76.9 %)
  Short-term FHLB advances and other borrowings     15,370     261,568   (94.1 %)
                   
  Total Short-term Borrowings   $ 323,772   $ 832,839   (61.1 %)
                     
                     
   
   
FULTON FINANCIAL CORPORATION  
ASSET QUALITY INFORMATION (UNAUDITED)  
dollars in thousands  
                               
    Three Months Ended     Year Ended  
    Dec 31     Dec 31     Sep 30     Dec 31     Dec 31  
    2015     2014     2015     2015     2014  
ALLOWANCE FOR CREDIT LOSSES:                                        
                                         
  Balance at beginning of period   $ 169,395     $ 191,108     $ 169,453     $ 185,931     $ 204,917  
                                         
  Loans charged off:                                        
    Consumer and home equity     (1,466 )     (1,696 )     (1,590 )     (5,831 )     (7,811 )
    Real estate - commercial mortgage     (1,207 )     (920 )     (660 )     (4,218 )     (6,004 )
    Commercial - industrial, financial and agricultural     (970 )     (8,712 )     (1,640 )     (15,639 )     (24,516 )
    Real estate - residential mortgage     (513 )     (752 )     (1,035 )     (3,612 )     (2,918 )
    Real estate - construction     0       (464 )     (114 )     (201 )     (1,209 )
    Leasing and other     (1,304 )     (701 )     (522 )     (2,656 )     (2,135 )
    Total loans charged off     (5,460 )     (13,245 )     (5,561 )     (32,157 )     (44,593 )
  Recoveries of loans previously charged off:                                        
    Consumer and home equity     825       419       618       2,492       2,347  
    Real estate - commercial mortgage     1,072       319       842       2,801       1,960  
    Commercial - industrial, financial and agricultural     1,409       1,724       1,598       5,264       4,256  
    Real estate - residential mortgage     775       132       201       1,322       451  
    Real estate - construction     548       2,325       898       2,824       3,177  
    Leasing and other     98       149       346       685       916  
    Recoveries of loans previously charged off     4,727       5,068       4,503       15,388       13,107  
  Net loans charged off     (733 )     (8,177 )     (1,058 )     (16,769 )     (31,486 )
  Provision for credit losses     2,750       3,000       1,000       2,250       12,500  
                                         
  Balance at end of period   $ 171,412     $ 185,931     $ 169,395     $ 171,412     $ 185,931  
                                         
  Net charge-offs to average loans (annualized)     0.02 %     0.25 %     0.03 %     0.13 %     0.24 %
                                         
NON-PERFORMING ASSETS:                                        
                                         
  Non-accrual loans   $ 129,523     $ 121,080     $ 132,154                  
  Loans 90 days past due and accruing     15,291       17,402       12,867                  
    Total non-performing loans     144,814       138,482       145,021                  
  Other real estate owned     11,099       12,022       10,561                  
                                         
  Total non-performing assets   $ 155,913     $ 150,504     $ 155,582                  
                                         
NON-PERFORMING LOANS, BY TYPE:                                        
                                         
  Commercial - industrial, financial and agricultural   $ 44,071     $ 30,388     $ 38,032                  
  Real estate - commercial mortgage     41,170       45,237       49,021                  
  Real estate - residential mortgage     28,484       28,995       27,707                  
  Consumer and home equity     17,123       17,330       15,186                  
  Real estate - construction     12,460       16,399       14,989                  
  Leasing     1,506       133       86                  
                                         
  Total non-performing loans   $ 144,814     $ 138,482     $ 145,021                  
                                         
                                         
TROUBLED DEBT RESTRUCTURINGS (TDRs), BY TYPE:                                  
                                         
  Real-estate - residential mortgage   $ 28,511     $ 31,308     $ 29,330                  
  Real-estate - commercial mortgage     17,563       18,822       17,282                  
  Commercial - industrial, financial and agricultural     5,953       5,237       7,399                  
  Real estate - construction     3,942       9,241       4,363                  
  Consumer and home equity     4,589       3,013       3,983                  
  Total accruing TDRs     60,558       67,621       62,357                  
  Non-accrual TDRs (1)     31,035       24,616       27,618                  
  Total TDRs   $ 91,593     $ 92,237     $ 89,975                  
                                         
(1) Included within non-accrual loans above.
                                         
                                         
   
   
DELINQUENCY RATES, BY TYPE:  
   
    Dec 31, 2015     Dec 31, 2014     Sep 30, 2015  
    31-89 Days     ≥90 Days (2)     Total     31-89 Days     ≥90 Days (2)     Total     31-89 Days     ≥90 Days (2)     Total  
                                                       
  Real estate - commercial mortgage   0.14 %   0.77 %   0.91 %   0.35 %   0.87 %   1.22 %   0.16 %   0.92 %   1.08 %
  Commercial - industrial, financial and agricultural   0.21 %   1.06 %   1.27 %   0.17 %   0.81 %   0.98 %   0.35 %   0.97 %   1.32 %
  Real estate - construction   0.28 %   1.59 %   1.87 %   0.02 %   2.38 %   2.40 %   0.30 %   1.95 %   2.25 %
  Real estate - residential mortgage   1.33 %   2.07 %   3.40 %   1.96 %   2.10 %   4.06 %   1.27 %   2.00 %   3.27 %
  Consumer, home equity, leasing and other   0.70 %   0.88 %   1.58 %   0.80 %   0.82 %   1.62 %   0.69 %   0.72 %   1.41 %
  Total   0.37 %   1.04 %   1.41 %   0.52 %   1.06 %   1.58 %   0.42 %   1.07 %   1.49 %
                                                       
(2) Includes non-accrual loans
 
 
ASSET QUALITY RATIOS:  
    Dec 31     Dec 31     Sep 30  
    2015     2014     2015  
                   
  Non-accrual loans to total loans   0.94 %   0.92 %   0.98 %
  Non-performing loans to total loans   1.05 %   1.06 %   1.07 %
  Non-performing assets to total loans and OREO   1.13 %   1.15 %   1.15 %
  Non-performing assets to total assets   0.87 %   0.88 %   0.87 %
  Allowance for credit losses to loans outstanding   1.24 %   1.42 %   1.25 %
  Allowance for credit losses to non-performing loans   118.37 %   134.26 %   116.81 %
  Non-performing assets to tangible common shareholders' equity and allowance for credit losses  
9.27
%  
9.12
%  
9.35
%
                     
                     
 
 
FULTON FINANCIAL CORPORATION
RECONCILIATION OF GAAP TO NON-GAAP MEASURES (UNAUDITED)
in thousands, except per share data and percentages
     
Explanatory note:   This press release contains supplemental financial information, as detailed below, which has been derived by methods other than Generally Accepted Accounting Principles ("GAAP"). The Corporation has presented these non-GAAP financial measures because it believes that these measures provide useful and comparative information to assess trends in the Corporation's results of operations. Presentation of these non-GAAP financial measures is consistent with how the Corporation evaluates its performance internally and these non-GAAP financial measures are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in the Corporation's industry. Management believes that these non-GAAP financial measures, in addition to GAAP measures, are also useful to investors to evaluate the Corporation's results. Investors should recognize that the Corporation's presentation of these non-GAAP financial measures might not be comparable to similarly-titled measures of other companies. These non-GAAP financial measures should not be considered a substitute for GAAP basis measures, and the Corporation strongly encourages a review of its condensed consolidated financial statements in their entirety. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measure follow:
                               
                               
    Three Months Ended     Year Ended  
    December 31     December 31     September 30     December 31     December 31  
    2015     2014     2015     2015     2014  
Shareholders' equity (tangible), per share                                        
Shareholders' equity   $ 2,041,894     $ 1,996,665     $ 2,025,904                  
Less: Goodwill and intangible assets     (531,556 )     (531,803 )     (531,562 )                
Tangible shareholders' equity (numerator)   $ 1,510,338     $ 1,464,862     $ 1,494,342                  
                                         
Shares outstanding, end of period (denominator)     174,176       178,924       173,771                  
                                         
  Shareholders' equity (tangible), per share   $ 8.67     $ 8.19     $ 8.60                  
                                         
Return on average common shareholders' equity (tangible)                                        
Net income   $ 38,535     $ 37,949     $ 34,251     $ 149,502     $ 157,894  
Plus: Intangible amortization, net of tax     4       205       3       161       818  
Numerator   $ 38,539     $ 38,154     $ 34,254     $ 149,663     $ 158,712  
                                         
Average shareholders' equity   $ 2,036,769     $ 2,052,211       2,022,829       2,026,883       2,071,640  
Less: Average goodwill and intangible assets     (531,559 )     (531,955 )     (531,564 )     (531,618 )     (532,425 )
Average tangible shareholders' equity (denominator)   $ 1,505,210     $ 1,520,256     $ 1,491,265     $ 1,495,265     $ 1,539,215  
                                         
  Return on average common shareholders' equity (tangible), annualized     10.16 %     9.96 %     9.11 %     10.01 %     10.31 %
                                         
Efficiency ratio                                        
Non-interest expense   $ 118,439     $ 117,720     $ 124,889     $ 480,160     $ 459,246  
Less: Intangible amortization     (6 )     (315 )     (5 )     (247 )     (1,259 )
Less: Loss on redemption of trust preferred securities     -       -       (5,626 )     (5,626 )     -  
Numerator   $ 118,433     $ 117,405     $ 119,258     $ 474,287     $ 457,987  
                                         
Net interest income (fully taxable equivalent)   $ 132,683     $ 132,614     $ 130,250     $ 518,464     $ 532,322  
Plus: Total Non-interest income     45,839       42,101       44,774       181,839       167,379  
Less: Investment securities gains     (776 )     (848 )     (1,730 )     (9,066 )     (2,041 )
Denominator   $ 177,746     $ 173,867     $ 173,294     $ 691,237     $ 697,660  
                                         
  Efficiency ratio     66.63 %     67.53 %     68.82 %     68.61 %     65.65 %
                                         
Non-performing assets to tangible common shareholders' equity and allowance for credit losses                                        
Non-performing assets (numerator)   $ 155,913     $ 150,504     $ 155,582                  
                                         
Tangible shareholders' equity   $ 1,510,338     $ 1,464,862     $ 1,494,342                  
Plus: Allowance for credit losses     171,412       185,931       169,395                  
Tangible shareholders' equity and allowance for credit losses (denominator)   $ 1,681,750     $ 1,650,793     $ 1,663,737                  
                                         
  Non-performing assets to tangible common shareholders' equity and allowance for credit losses     9.27 %     9.12 %     9.35 %                

PDF Available: http://media.marketwire.com/attachments/201601/93702_Q4EarningsCCPresentation12_31_15FINAL.pdf

Contact Information

  • Media Contact:
    Laura J. Wakeley
    (717) 291-2616
    Investor Contact:
    Jason Weber
    (717) 327-2394