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CST: 20/09/2019 03:03:55   

First Citizens BancShares Reports Earnings for Fourth Quarter 2018

232 Days ago

RALEIGH, N.C., Jan. 30, 2019 (GLOBE NEWSWIRE) -- First Citizens BancShares Inc. (BancShares) (Nasdaq: FCNCA) reported strong earnings for the year ended 2018 benefiting from net revenue growth and tax reform, according to Frank B. Holding, Jr., Chairman of the Board. Key results for the quarter and year ended December 31, 2018, are presented below:

   
  For the Quarter ended:
  4Q18   3Q18   4Q17  
Net income (in millions) $89.5   $117.3   $54.4  
Net income per share $7.62   $9.80   $4.53  
       
Annualized return on average assets 1.00 % 1.33 % 0.62 %
Annualized return on average equity 10.17 % 13.41 % 6.48 %
             


   
  For the Year ended:
  12/31/2018   12/31/2017  
Net income (in millions) $400.3   $323.8  
Net income per share $33.53   $26.96  
     
Return on average assets 1.15 % 0.94 %
Return on average equity 11.69 % 10.10 %
         

FINANCIAL HIGHLIGHTS

  • Net income for the fourth quarter of 2018 increased $35.1 million, or by 64.5 percent, compared to the fourth quarter of 2017. The increase was primarily the result of higher interest income due to loan growth and higher loan and investment yields, as well as lower income tax expense. Income tax expense was lower primarily due to the deferred tax asset re-measurement during the fourth quarter of 2017 as a result of tax reform. These net income improvements were partially offset by fair value adjustment losses on marketable equity securities.

  • Net income for the fourth quarter of 2018 decreased $27.8 million, or by 23.7 percent, compared to the third quarter of 2018. The decrease was primarily the result of fair value adjustment losses on marketable equity securities, higher provision for loan losses, and higher income tax expense. Income tax expense was higher primarily due to the tax benefit recognized during the third quarter of 2018. The tax benefit recognized represents a refinement of our original deferred tax asset adjustment recorded during the fourth quarter of 2017.  These reductions to net income were partially offset by increased interest income due to loan growth and higher loan and investment yields.

  • Net income for the year ended 2018 increased $76.6 million, or by 23.6 percent, compared to the year ended 2017. The increase was primarily the result of higher interest income due to loan growth, higher loan and investment yields, as well as lower income tax expense. Income tax expense was lower primarily due to the reduction in the corporate federal income tax rate from 35 percent to 21 percent and the deferred tax re-measurement during the fourth quarter of 2017, both items resulting from tax reform. These increases to net income were partially offset by lower gains on acquisitions and higher personnel, occupancy and furniture, fixtures and equipment expenses.

  • Earnings in 2018 included pre-tax gains of $26.6 million resulting from the extinguishment of Federal Home Loan Bank (FHLB) debt obligations as well as favorable impacts from tax reform.  Earnings in 2017 included pre-tax gains of $134.7 million recognized in connection with the FDIC-assisted transactions of Harvest Community Bank (HCB) of Pennsville, New Jersey, and Guaranty Bank (Guaranty) of Milwaukee, Wisconsin.

  • Loans grew by $636.9 million during the fourth quarter and by $1.93 billion for the year, reflecting originated loan growth of $329.5 million and $1.31 billion respectively.  Acquired loans from HomeBancorp, Capital Commerce and Palmetto Heritage totaled $798.7 million at year end.

  • Deposits grew by $508.9 million during the fourth quarter and by $1.41 billion for the year, reflecting organic deposit growth of $223.7 million and $675.7 million, respectively. Acquired deposits from HomeBancorp, Capital Commerce and Palmetto Heritage totaled $730.5 million at year end.

  • BancShares remained well-capitalized at December 31, 2018, under Basel III capital requirements with a Tier 1 risk-based capital ratio and common equity Tier 1 ratio of 12.67 percent, total risk-based capital ratio of 13.99 percent and leverage capital ratio of 9.77 percent.

MERGER ACTIVITY

On January 10, 2019, First Citizens Bank (FCB) and First South Bancorp, Inc. (First South Bancorp) entered into a definitive merger agreement for the acquisition by FCB of Spartanburg, South Carolina-based First South Bancorp and its bank subsidiary, First South Bank. Under the terms of the agreement, cash consideration of $1.15 will be paid to the shareholders of First South Bancorp for each share of common stock totaling approximately $37.5 million. The transaction is anticipated to close during the second quarter of 2019, subject to the receipt of regulatory approvals and the approval of First South Bancorp's shareholders. As of December 31, 2018, First South Bancorp reported $238.5 million in consolidated assets, $180.9 million in loans and $204.1 million in deposits.

On November 15, 2018, FCB and Biscayne Bancshares, Inc. (Biscayne Bancshares) entered into a definitive merger agreement for the acquisition by FCB of Coconut Grove, Florida-based Biscayne Bancshares and its bank subsidiary, Biscayne Bank. Under the terms of the agreement, cash consideration of $25.05 will be paid to the shareholders of Biscayne Bancshares for each share of common stock totaling approximately $118.7 million. The transaction is expected to close during the second quarter of 2019, subject to the receipt of regulatory approvals. As of December 31, 2018, Biscayne Bancshares reported $1.01 billion in consolidated assets, $850.3 million in loans and $746.4 million in deposits.

On November 1, 2018, FCB completed the merger of Pawleys Island, South Carolina-based Palmetto Heritage Bancshares, Inc. (Palmetto Heritage) and its subsidiary, Palmetto Heritage Bank & Trust, into FCB. Under the terms of the agreement, cash consideration of $135.00 per share was paid to the shareholders of Palmetto Heritage for each share of Palmetto Heritage's common stock with total consideration paid of $30.4 million. FCB acquired $162.2 million in assets, $135.1 million in loans and $124.9 million in deposits.

On October 2, 2018, FCB completed the merger of Milwaukee, Wisconsin-based Capital Commerce Bancorp, Inc. (Capital Commerce) and its subsidiary, Securant Bank & Trust, into FCB. Under the terms of the agreement, cash consideration of $4.75 per share was paid to the shareholders of Capital Commerce for each share of Capital Commerce's common stock with total consideration paid of $28.1 million. FCB acquired $221.9 million in assets, $184.1 million in loans and $172.4 million in deposits.

On May 1, 2018, FCB completed the merger of Tampa, Florida-based HomeBancorp, Inc. (HomeBancorp) and its subsidiary, HomeBanc, into FCB. Under the terms of the agreement, cash consideration of $15.03 per share was paid to the shareholders of HomeBancorp for each share of HomeBancorp's common stock with total consideration paid of $112.7 million. FCB acquired $842.7 million in assets, $566.2 million in loans and $619.6 million in deposits.

LOANS AND DEPOSITS

Loans at December 31, 2018, were $25.52 billion, a net increase of $636.9 million compared to September 30, 2018, representing growth of 10.2 percent on an annualized basis. The increase was driven by $374.3 million of organic growth in our commercial and residential mortgage portfolios, offset by pay downs on equity lines. Quarter end balances also included $294.0 million of non-PCI loans acquired in the Capital Commerce and Palmetto Heritage acquisitions. The growth in the non-PCI portfolio was partially offset by a net decline in the purchase credit impaired (PCI) portfolio of $31.4 million.

Loan balances increased by a net $1.93 billion, or 8.2 percent, since December 31, 2017. The increase was driven by $1.31 billion of originated loan growth in our commercial and residential mortgage portfolios, offset by pay downs of equity lines. Year end balances also included $770.2 million non-PCI loans acquired in the HomeBancorp, Capital Commerce and Palmetto Heritage acquisitions. The growth in the non-PCI portfolio was partially offset by a net decline in the PCI portfolio of $156.4 million.

At December 31, 2018, deposits were $30.67 billion, an increase of $508.9 million, or 1.7 percent, from September 30, 2018. The increase was due to organic growth of $223.7 million primarily in money market and time deposits accounts. In addition to organic growth, year end balances also included $164.5 million and $120.7 million in deposits related to the Capital Commerce and Palmetto Heritage acquisitions, respectively.

Deposits increased by $1.41 billion, or 4.8 percent, since December 31, 2017, due to organic growth of $675.7 million primarily in noninterest bearing demand deposit accounts. The remaining increase was due to deposit balances acquired from HomeBancorp, Capital Commerce and Palmetto Heritage.

ALLOWANCE AND PROVISION FOR LOAN AND LEASE LOSSES

The allowance for loan and lease losses was $223.7 million at December 31, 2018, an increase of $4.5 million from September 30, 2018 and $1.8 million from December 31, 2017. The allowance as a percentage of total loans at December 31, 2018, and September 30, 2018, was 0.88 percent, compared to 0.94 percent at December 31, 2017.

BancShares recorded net provision expense of $11.6 million during the fourth quarter of 2018, compared to net provision expense of $840 thousand for the third quarter of 2018 and net provision credit of $2.8 million for the fourth quarter of 2017. The $10.7 million and $14.4 million increases, respectively, were largely driven by prior period provision decreases due to loan loss factor reductions  as well as current quarter loan growth within higher reserve loan segments and increased net charge-offs.

NONPERFORMING ASSETS

BancShares’ nonperforming assets, including nonaccrual loans and other real estate owned (OREO), were $133.9 million at December 31, 2018, up from $130.6 million at September 30, 2018, and down from $144.3 million at December 31, 2017. The increase from September 30, 2018, was primarily due to an increase in OREO, whereas the decrease from December 31, 2017, was primarily due to a decrease in nonaccrual commercial loans.

NET INTEREST INCOME

Net interest income for the fourth quarter of 2018 increased $13.5 million to $320.9 million, or by 4.4 percent, compared to the third quarter of 2018. The taxable equivalent net interest margin was 3.82 percent in the fourth quarter of 2018, an increase of 9 basis points from the prior quarter.

The increase was primarily due to:

  • A rising rate environment generating higher loan yields and increased loan balances predominantly in our commercial and residential loan portfolios;
  • Loan portfolios acquired from Capital Commerce and Palmetto Heritage.

Net interest income for the fourth quarter of 2018 increased $46.1 million, or by 16.8 percent, compared to the fourth quarter of 2017. The taxable-equivalent net interest margin was 3.82 percent in the fourth quarter of 2018, an increase of 48 basis points from the same quarter in the prior year.

Net interest income for the year ended 2018 increased $149.0 million, or by 14.1 percent, compared to the year ended 2017. The taxable-equivalent net interest margin was 3.69 percent for the year ended 2018, an increase of 39 basis points from the year ended 2017.

The increase was primarily due to:

  • A $40.8 million increase in net loan interest income due to higher loan yields and loan growth, primarily within our commercial and residential loan portfolios;
  • Improved yields on our investment portfolio;
  • lmpact from loan portfolios acquired in the HomeBanc, Capital Commerce and Palmetto Heritage acquisitions;
  • Lower borrowing costs due to debt extinguishments in the first quarter of 2018; partially offset by
  • Higher rates paid on deposits, primarily money market and time deposits.

NONINTEREST INCOME

Noninterest income for the fourth quarter of 2018 was $82.0 million, a decrease of $12.5 million from the third quarter of 2018. The decrease was primarily the result of a $20.7 million decline in the fair value adjustment to marketable equity securities due to market volatility, partially offset by an increase of $6.6 million in cardholder and merchant income resulting from higher sales volume and increased vendor incentives.

Noninterest income decreased $26.6 million from the fourth quarter of 2017, primarily driven by a $16.9 million decline in the fair value adjustment to marketable equity securities and a $12.4 million decrease in gains on extinguishment of debt. These decreases were partially offset by an increase of $6.8 million in cardholder and merchant income driven primarily by higher sales volume and increased vendor incentives.

NONINTEREST EXPENSE

Noninterest expense increased by $7.8 million to $275.4 million compared to the third quarter of 2018. The increase was primarily the result of higher operational expenses driven by repairs for hurricane damage, acquisition related expenses and other miscellaneous expense items.

Noninterest expense increased by $12.3 million from the same quarter last year largely due to an increase in personnel expenses, primarily related to payroll incentives and annual merit increases, as well as increased headcount from the HomeBancorp, Capital Commerce and Palmetto Heritage acquisitions. These increases were partially offset by a reduction in FDIC assessment fees.

INCOME TAXES

Quarterly income tax expense and effective tax rates are shown below:

   
  For the Quarter ended:
  4Q18   3Q18   4Q17  
Income tax expense (millions) $26.5   $16.2   $68.7  
Effective tax rate 22.8 % 12.1 % 55.8 %
             

The Tax Cuts and Jobs Act of 2017 (Tax Act), enacted on December 22, 2017, reduced the federal corporate income tax rate from 35 percent to 21 percent effective January 1, 2018.

During the fourth quarter of 2017, as a result of the reduction in the tax rate, income tax expense was increased by $25.8 million to re-measure our deferred tax asset. Excluding the effects of the Tax Act adjustment, the effective tax rate for the fourth quarter of 2017 would have been 34.9 percent.

During the third quarter of 2018, income tax expense was reduced by $15.7 million to record a tax benefit related to the effects of the Tax Act. The benefit recorded represents an update of the original Tax Act adjustment recorded during the fourth quarter of 2017. Excluding the effects of the Tax Act, the effective tax rate for the third quarter of 2018 would have been 23.9 percent.

The accounting for the effects of the Tax Act was initiated in the fourth quarter of 2017 and was completed in the fourth quarter of 2018 with no additional material adjustments to income tax expense during the fourth quarter.

ABOUT FIRST CITIZENS BANCSHARES

BancShares is the financial holding company for Raleigh, North Carolina-headquartered First Citizens Bank. First Citizens Bank provides a broad range of financial services to individuals, businesses, professionals and the medical community through branch offices in 19 states, including digital banking, mobile banking, ATMs and telephone banking. As of December 31, 2018, BancShares had total assets of $35.4 billion.

For more information, visit First Citizens’ website at firstcitizens.com. First Citizens Bank. Forever First®.

 
CONSOLIDATED FINANCIAL HIGHLIGHTS
       
  Three months ended   Year ended December 31
(Dollars in thousands, except share data; unaudited) December 31,
2018
  September 30,
2018
  December 31,
2017
  2018   2017
SUMMARY OF OPERATIONS                  
Interest income $ 333,573     $ 315,706     $ 285,958     $ 1,245,757     $ 1,103,690  
Interest expense 12,691     8,344     11,189     36,857     43,794  
Net interest income 320,882     307,362     274,769     1,208,900     1,059,896  
(Credit) provision for loan and lease losses 11,585     840     (2,809 )   28,468     25,692  
Net interest income after provision for loan and lease losses 309,297     306,522     277,578     1,180,432     1,034,204  
Gain on acquisitions                 134,745  
Noninterest income excluding gain on acquisitions 82,007     94,531     108,613     400,149     387,218  
Noninterest expense 275,378     267,537     263,080     1,076,971     1,012,469  
Income before income taxes 115,926     133,516     123,111     503,610     543,698  
Income taxes 26,453     16,198     68,704     103,297     219,946  
Net income $ 89,473     $ 117,318     $ 54,407     $ 400,313     $ 323,752  
Taxable-equivalent net interest income $ 321,804     $ 308,207     $ 276,002     $ 1,212,280     $ 1,064,415  
PER SHARE DATA                  
Net income $ 7.62     $ 9.80     $ 4.53     $ 33.53     $ 26.96  
Cash dividends 0.40     0.35     0.35     1.45     1.25  
Book value at period-end 300.04     294.40     277.60     300.04     277.60  
CONDENSED BALANCE SHEET                  
Cash and due from banks $ 327,440     $ 262,525     $ 336,150     $ 327,440     $ 336,150  
Overnight investments 797,406     943,025     1,387,927     797,406     1,387,927  
Investment securities 6,741,763     7,040,674     7,180,256     6,741,763     7,180,256  
Loans and leases 25,523,276     24,886,347     23,596,825     25,523,276     23,596,825  
Less allowance for loan and lease losses (223,712 )   (219,197 )   (221,893 )   (223,712 )   (221,893 )
Other assets 2,242,456     2,041,285     2,248,247     2,242,456     2,248,247  
Total assets $ 35,408,629     $ 34,954,659     $ 34,527,512     $ 35,408,629     $ 34,527,512  
Deposits 30,672,460     30,163,537     29,266,275     30,672,460     29,266,275  
Other liabilities 1,247,215     1,292,109     1,927,173     1,247,215     1,927,173  
Shareholders' equity 3,488,954     3,499,013     3,334,064     3,488,954     3,334,064  
Total liabilities and shareholders' equity $ 35,408,629     $ 34,954,659     $ 34,527,512     $ 35,408,629     $ 34,527,512  
SELECTED PERIOD AVERAGE BALANCES                
Total assets $ 35,625,500     $ 34,937,175     $ 34,864,720     $ 34,879,912     $ 34,302,867  
Investment securities 7,025,889     7,129,089     7,044,534     7,074,929     7,036,564  
Loans and leases 25,343,813     24,698,799     23,360,235     24,483,719     22,725,665  
Interest-earning assets 33,500,732     32,886,276     32,874,233     32,847,661     32,213,646  
Deposits 30,835,157     30,237,329     29,525,843     30,165,249     29,119,344  
Interest-bearing liabilities 19,282,749     18,783,160     19,425,404     18,995,727     19,576,353  
Shareholders' equity $ 3,491,914     $ 3,470,368     $ 3,329,562     $ 3,422,941     $ 3,206,250  
Shares outstanding 11,763,832     11,971,460     12,010,405     11,938,439     12,010,405  
SELECTED RATIOS                  
Annualized return on average assets 1.00 %   1.33 %   0.62 %   1.15 %   0.94 %
Annualized return on average equity 10.17     13.41     6.48     11.69     10.10  
Taxable-equivalent net interest margin 3.82     3.73     3.34     3.69     3.30  
Efficiency ratio (1) 65.66     67.33     70.86     67.74     70.78  
Tier 1 risk-based capital ratio 12.67     13.23     12.88     12.67     12.88  
Common equity Tier 1 ratio 12.67     13.23     12.88     12.67     12.88  
Total risk-based capital ratio 13.99     14.57     14.21     13.99     14.21  
Leverage capital ratio 9.77     10.11     9.47     9.77     9.47  
 
(1) The efficiency ratio is a non-GAAP financial measure which measures productivity and is generally calculated as noninterest expense divided by total revenue (net interest income and noninterest income). The efficiency ratio removes the impact of BancShares' securities gains, acquisition gains, one-time gains on extinguishment of debt, fair market value adjustment on marketable equity securities and FDIC shared-loss termination from the calculation. Management uses this ratio to monitor performance and believes this measure provides meaningful information to investors.
 


 
ALLOWANCE FOR LOAN AND LEASE LOSSES AND ASSET QUALITY DISCLOSURES
       
  Three months ended   Year ended December 31
(Dollars in thousands, unaudited) December 31,
2018
  September 30,
2018
  December 31,
2017
  2018   2017
ALLOWANCE FOR LOAN AND LEASE LOSSES (ALLL)                  
ALLL at beginning of period $ 219,197     $ 224,865     $ 231,842     $ 221,893     $ 218,795  
(Credit) provision for loan and lease losses:                  
PCI loans (1) (1,765 )   (1,514 )   (2,637 )   (765 )   (3,447 )
Non-PCI loans (1) 13,350     2,354     (172 )   29,232     29,139  
Net charge-offs of loans and leases:                  
Charge-offs (10,768 )   (9,447 )   (9,994 )   (39,671 )   (36,682 )
Recoveries 3,698     2,939     2,854     13,023     14,088  
Net charge-offs of loans and leases (7,070 )   (6,508 )   (7,140 )   (26,648 )   (22,594 )
ALLL at end of period $ 223,712     $ 219,197     $ 221,893     $ 223,712     $ 221,893  
ALLL at end of period allocated to loans and leases:                  
PCI $ 9,144     $ 10,909     $ 10,026     $ 9,144     $ 10,026  
Non-PCI 214,568     208,288     211,867     214,568     211,867  
ALLL at end of period $ 223,712     $ 219,197     $ 221,893     $ 223,712     $ 221,893  
Reserve for unfunded commitments $ 1,107     $ 1,089     $ 1,032     $ 1,107     $ 1,032  
SELECTED LOAN DATA                  
Average loans and leases:                  
PCI $ 616,664     $ 652,983     $ 799,399     $ 671,128     $ 845,030  
Non-PCI 24,727,149     24,045,816     22,560,836     23,812,591     21,880,635  
Loans and leases at period-end:                  
PCI 606,576     638,018     762,998     606,576     762,998  
Non-PCI 24,916,700     24,248,329     22,833,827     24,916,700     22,833,827  
RISK ELEMENTS                  
Nonaccrual loans and leases $ 85,822     $ 86,949     $ 93,158     $ 85,822     $ 93,158  
Other real estate 48,030     43,601     51,097     48,030     51,097  
Total nonperforming assets $ 133,852     $ 130,550     $ 144,255     $ 133,852     $ 144,255  
Accruing loans and leases 90 days or more past due $ 39,908     $ 40,713     $ 61,718     $ 39,908     $ 61,718  
RATIOS                  
Net charge-offs (annualized) to average loans and leases 0.11     0.10     0.12     0.11     0.10  
ALLL to total loans and leases:                  
PCI 1.51     1.71     1.31     1.51     1.31  
Non-PCI 0.86     0.86     0.93     0.86     0.93  
Total 0.88     0.88     0.94     0.88     0.94  
Ratio of total nonperforming assets to total loans, leases and other real estate owned 0.52     0.52     0.61     0.52     0.61  
                             
(1) Loans and leases are evaluated at acquisition and where a discount is noted at least in part due to credit quality, the loans are accounted for under the guidance in ASC Topic 310-30, Loans and Debt Securities Acquired with Deteriorated Credit Quality. Loans for which it is probable at acquisition that all required payments will not be collected in accordance with the contractual terms are considered purchased credit-impaired (PCI) loans. PCI loans and leases are recorded at fair value at the date of acquisition. No allowance for loan and lease losses is recorded on the acquisition date as the fair value of the acquired assets incorporates assumptions regarding credit risk. An allowance is recorded if there is additional credit deterioration after the acquisition date. Non-PCI loans include originated and purchased non-impaired loans.
 


 
AVERAGE BALANCE AND NET INTEREST MARGIN SUMMARY
     
  Three months ended  
  December 31, 2018   September 30, 2018   December 31, 2017  
  Average        Yield/   Average        Yield/   Average        Yield/  
(Dollars in thousands, unaudited) Balance   Interest    Rate (2)   Balance   Interest    Rate (2)   Balance   Interest    Rate (2)  
INTEREST-EARNING ASSETS                                    
Loans and leases (1) $ 25,343,813   $ 288,484   4.52 % $ 24,698,799   $ 272,868   4.39 % $ 23,360,235   $ 248,151   4.22 %
Investment securities:                                    
U. S. Treasury 1,454,889   7,261   1.98   1,504,594   7,104   1.87   1,627,968   4,784   1.17  
Government agency 192,830   1,288   2.67   129,634   840   2.59   9,659   69   2.85  
Mortgage-backed securities 5,136,489   29,261   2.28   5,266,282   29,160   2.21   5,233,293   25,351   1.94  
Corporate bonds and other 135,962   1,810   5.32   121,855   1,609   5.28   63,911   991   6.20  
State, county and municipal 78   3   17.14              
Marketable equity securities 105,641   323   1.22   106,724   249   0.93   109,703   246   0.89  
Total investment securities 7,025,889   39,946   2.27   7,129,089   38,962   2.18   7,044,534   31,441   1.78  
Overnight investments 1,131,030   6,065   2.13   1,058,388   4,721   1.77   2,469,464   7,599   1.22  
Total interest-earning assets $ 33,500,732   $ 334,495   3.97 % $ 32,886,276   $ 316,551   3.83 % $ 32,874,233   $ 287,191   3.47 %
INTEREST-BEARING LIABILITIES                                    
Interest-bearing deposits:                                    
Checking with interest $ 5,254,677   $ 332   0.03 % $ 5,177,349   $ 319   0.02 % $ 5,028,978   $ 262   0.02 %
Savings 2,511,444   213   0.03   2,506,421   210   0.03   2,337,993   172   0.03  
Money market accounts 7,971,726   4,335   0.22   7,878,484   2,455   0.12   8,047,691   1,732   0.09  
Time deposits 2,599,498   4,179   0.64   2,367,980   2,163   0.36   2,421,749   1,623   0.27  
Total interest-bearing deposits 18,337,345   9,059   0.20   17,930,234   5,147   0.11   17,836,411   3,789   0.08  
Repurchase agreements 572,442   419   0.29   547,385   398   0.29   615,244   622   0.40  
Other short-term borrowings 53,552   298   2.21   43,720   287   2.57   107,551   1,031   3.77  
Long-term obligations 319,410   2,915   3.58   261,821   2,512   3.77   866,198   5,747   2.61  
Total interest-bearing liabilities $ 19,282,749   $ 12,691   0.26 % $ 18,783,160   $ 8,344   0.18 % $ 19,425,404   $ 11,189   0.23 %
Interest rate spread         3.71 %         3.65 %         3.24 %
Net interest income and net yield on interest-earning assets     $ 321,804   3.82 %     $ 308,207   3.73 %     $ 276,002   3.34 %
                                           
(1) Loans and leases include PCI loans and non-PCI loans, nonaccrual loans and loans held for sale.
(2) Yields related to loans, leases and securities exempt from both federal and state income taxes, federal income taxes only, or state income taxes only are stated on a taxable-equivalent basis assuming statutory federal income tax rates of 21.0 percent, 21.0 percent and 35.0 percent as well as state income tax rates of 3.4 percent, 3.4 percent and 3.1 percent for the three months ended December 31, 2018, September 30, 2018 and December 31, 2017, respectively. The taxable-equivalent adjustment was $922, $845 and $1,233 for the three months ended December 31, 2018, September 30, 2018 and December 31, 2017, respectively. The rate/volume variance is allocated equally between the changes in volume and rate.
 


   
Contact: Barbara Thompson
  First Citizens BancShares
  (919) 716-2716
   

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