UMPQUA REPORTS THIRD QUARTER 2022 RESULTS

News provided by

Umpqua Holdings Corporation

Oct 19, 2022, 16:15 ET

Third Quarter 2022 Results

  • Net income of $84 million, or $0.39 per common share
  • Operating net income of $103 million, or $0.47 per common share1
  • Loan balances increased $1.1 billion or 4.4%
  • Deposit balances increased $685 million or 2.6%
  • Net interest margin increased 47 basis points to 3.88%

PORTLAND, Ore., Oct. 19, 2022 /PRNewswire/ --

UMPQUA REPORTS THIRD QUARTER 2022 RESULTS

$0.39

$84

13.02 %

13.2 %

Net earnings per diluted
common share

Net income ($ in millions)

Return on average tangible
common equity ("ROATCE")1

Total risk-based capital ratio
(estimated)

CEO Commentary

"Strong loan growth, exceptional credit quality, and net interest margin expansion again characterize Umpqua's quarterly results," said Cort O'Haver, President and CEO. "New loan generation reflects existing, conservative portfolio trends, and our efforts to thoughtfully execute loan and deposit pricing changes in the rising rate environment contributed to a 16% sequential-quarter increase in net interest income. Although the net increase in loans outpaced our deposit expansion, we are pleased with the more balanced growth levels compared to the prior quarter. Our teams remain focused on relationship banking with our customers and within our communities as we await the realization of items necessary to complete our proposed combination with Columbia Banking System."

–  Cort O'Haver, President and CEO of Umpqua Holdings Corporation

3Q22 HIGHLIGHTS (COMPARED TO 2Q22)


Net Interest
Income and
NIM

•  Net interest income increased by $39 million or 16% on a quarter-to-quarter basis due to the favorable impact of rising interest rates and the higher mix of loans as a percentage of earning assets.

•  Net interest margin was 3.88%, up 47 basis points from the prior quarter. Total deposit costs were 14 basis points for the quarterly average and 22 basis points at September 30, 2022, compared to 6 basis points at June 30, 2022.


Non-Interest
Income and
Expense

•  Non-interest income decreased by $26 million due primarily to the impact of rising interest rates on fair value accounting and hedges and lower residential mortgage gain-on-sale income.

•  Non-interest expense decreased by $1.6 million due to lower salaries and employee benefits expense and lower merger-related expenses, partially offset by a net increase in other miscellaneous expenses.



Credit
Quality

•  Net charge-offs remained low at 0.11% of average loans and leases (annualized).

•  Provision expense of $28 million compares to $19 million for the prior quarter. Net portfolio growth and economic forecast changes are the primary drivers of the increase.

•  Non-performing assets to total assets was 0.16%, up 1 basis point from June 30, 2022.


Capital

•  Estimated total risk-based capital ratio of 13.2% and estimated tier 1 risk-based capital ratio of 10.7%.

•  Declared a quarterly cash dividend of $0.21 per common share on October 3, 2022, payable October 28, 2022, to holders of record as of October 14, 2022.



Notable
items

•  MSR hedge put in place in mid-August as additional actions taken to reduce mortgage segment volatility.

•  $0.8 million in merger-related expenses and $1.4 million in exit and disposal costs.

3Q22 KEY FINANCIAL DATA






PERFORMANCE
METRICS

3Q22

2Q22

3Q21

Return on average assets

1.09 %

1.04 %

1.40 %

Return on average tangible
common equity1

13.02 %

12.23 %

15.88 %

Operating return on average
assets1

1.33 %

1.06 %

1.40 %

Operating return on average
tangible common equity1

15.90 %

12.49 %

15.88 %

Net interest margin

3.88 %

3.41 %

3.21 %

Efficiency ratio - consolidated

56.07 %

59.12 %

59.44 %

Loan to deposit ratio

95.12 %

93.50 %

81.65 %






INCOME STATEMENT

($ in 000s, excl. per share data)

3Q22

2Q22

3Q21

Net interest income

$287,604

$248,170

$235,074

Provision (recapture) for
credit losses

$27,572

$18,692

($18,919)

Non-interest income

$29,445

$55,235

$73,705

Non-interest expense

$177,964

$179,574

$183,753

Pre-provision net revenue1

$139,085

$123,831

$125,026

Operating pre-provision net
revenue1

$163,793

$125,994

$124,955

Earnings per common share -
diluted

$0.39

$0.36

$0.49

Operating earnings per
common share - diluted1

$0.47

$0.37

$0.49

Dividends paid per share

$0.21

$0.21

$0.21






BALANCE SHEET

3Q22

2Q22

3Q21

Total assets

      $31.5B


      $30.1B


      $30.9B

Loans and leases

      $25.5B


      $24.4B


      $22.0B

Total deposits

      $26.8B


      $26.1B


      $26.9B

Book value per common share

$11.14

$11.60

$12.57

Tangible book value per
share1

$11.11

$11.57

$12.52

Tangible book value per
share, ex AOCI1

$13.18

$12.99

$12.43
Balance Sheet

Total consolidated assets were $31.5 billion as of September 30, 2022, compared to $30.1 billion as of June 30, 2022 and $30.9 billion as of September 30, 2021.  Including secured off-balance sheet lines of credit, total available liquidity was $14.4 billion as of September 30, 2022, representing 46% of total assets and 54% of total deposits.

Gross loans and leases were $25.5 billion as of September 30, 2022, an increase of $1.1 billion relative to June 30, 2022. Growth remained balanced across portfolios as it was diversified further by business lines and geographies. New loans added to the portfolio during the third quarter have similar underwriting characteristics to existing loan categories, as our Q3 2022 Earnings Presentation details.

Total deposits were $26.8 billion as of September 30, 2022, an increase of $685 million or 2.6% from $26.1 billion as of June 30, 2022. Interest-bearing demand and money market balances accounted for the largest expansion by dollars, though all categories increased during the quarter.

Net Interest Income

Net interest income was $288 million for the third quarter of 2022, up $39 million from the prior quarter. The increase reflects the favorable impact of higher interest rates on our asset sensitive balance sheet and the full quarter effect of the significant deployment of cash into loans that occurred in the second quarter of 2022.

The Company's net interest margin was 3.88% for the third quarter of 2022, up 47 basis points from 3.41% for the second quarter of 2022. The increase is attributable to the higher mix of loans as a percentage of earning assets as well as an increase in individual category earning asset yields given upward interest rate movements. The cost of interest-bearing deposits increased twelve basis points to 0.23% for the third quarter of 2022 compared to the second quarter of 2022, and it was 0.38% on September 30, 2022 compared to 0.10% on June 30, 2022. Please refer to the Q3 2022 Earnings Presentation available on our website for additional net interest margin change details and interest rate sensitivity information.

Credit Quality

The allowance for credit losses was $295 million, or 1.16% of loans and leases, as of September 30, 2022, compared to $274 million, or 1.12% of loans and leases, as of June 30, 2022.  The provision for credit losses of $28 million for the third quarter of 2022 compares to a provision of $19 million for the second quarter of 2022. The current quarter's provision reflects allowance requirements for new loan generation; changes between the May 2022 and August 2022 economic forecasts used in credit models, which contributed to the quarter's net expense; and loan mix changes. Please refer to the Q3 2022 Earnings Presentation available on our website for additional details related to the allowance for credit losses.

Net charge-offs were 0.11% of average loans and leases (annualized) for the third quarter of 2022, compared to 0.11% for the second quarter of 2022. Net charge-off activity within the FinPac portfolio continued to remain below its historical average. As of September 30, 2022, non-performing assets were 0.16% of total assets, compared to 0.15% as of June 30, 2022 and 0.17% as of September 30, 2021.

Non-interest Income

Non-interest income was $29 million for the third quarter of 2022, down $26 million from the prior quarter. The decline was primarily driven by a net fair value loss of $23 million in the third quarter related to cumulative fair value adjustments and MSR hedging activity, which compares to a net fair value gain of $1.0 million in the second quarter. Lower mortgage gain-on-sale revenue also contributed to the quarter's decline.

As detailed in our segment and non-GAAP disclosures, non-interest income for the Core Banking segment includes a fair value loss of $25 million for the third quarter of 2022, driven by an increase in long-term interest rates and their effect on fair value adjustments related to investment securities, swap derivatives, and loans carried at fair value. This compares to a fair value loss of $10 million in the second quarter of 2022, and the $15 million adverse movement in fair value change between periods is primarily captured in other income. Please refer to the Q3 2022 Earnings presentation available on our website for additional details related to other non-interest income.

Revenue from the origination and sale of residential mortgages was $11 million for the third quarter of 2022, a decrease of $4.6 million from the prior quarter. This decline reflects a sequential-quarter decrease of $180 million or 31% in for-sale mortgage origination volume given the impact of rising long-term interest rates.  Of the current quarter's mortgage production, 92% related to purchase activity, compared to 83% for the prior quarter and 61% for the same period of the prior year. While the mortgage banking gain-on-sale margin increased three basis points from the prior quarter to 2.65% for the third quarter of 2022, it continued to reflect the negative impact from rising rates on the pipeline.

In mid-August, we put hedges in place to reduce the volatility of MSR fair value impacts on a net basis. In the third quarter of 2022, we recorded a net write-up of the MSR asset of $11 million, which includes a $16 million fair value gain related to model inputs. We correspondingly recorded a $14 million MSR hedge loss during the quarter. Results for the month of September indicate the MSR hedges are working as planned to reduce net income volatility as the $11 million fair value gain related to model inputs was nearly offset by the MSR hedge loss of $10 million during the month. We continue to execute structural changes within our Mortgage Banking segment to manage expenses and efficiently deploy capital, and as part of the process, we reduced headcount during the third quarter.

Non-interest Expense

Non-interest expense was $178 million for the third quarter of 2022, down $1.6 million from the prior quarter level. The decrease is primarily due to lower salaries and employee benefits and lower merger-related expenses, partially offset by a net increase in other miscellaneous expenses. The third quarter of 2022 included $0.8 million in merger-related expenses. Please refer to the Q3 2022 Earnings Presentation available on our website for additional quarterly expense change details.

Capital

As of September 30, 2022, the Company's tangible book value per common share2 decreased to $11.11, compared to $11.57 in the prior quarter and $12.52 in the same period of the prior year. Rising interest rates drove a decline in the fair value of available-for-sale investment securities and an increase in junior subordinated debt accounted for at fair value during the quarter. The impact of these items is reflected by a decline in accumulated other comprehensive (loss) income ("AOCI") to $(450) million, compared to $(308) million at the prior quarter-end and $20 million at September 30, 2021. Excluding AOCI, tangible book2 increased to $13.18 at September 30, 2022, compared to $12.99 and $12.43 for the linked-quarter and year-ago periods, respectively.

AOCI has no effect on our regulatory capital ratios as the company opted to exclude it from our common equity tier 1 capital calculations. The Company's estimated total risk-based capital ratio was 13.2% and its estimated tier 1 risk-based capital ratio was 10.7% as of September 30, 2022. The Company remains above current "well-capitalized" regulatory minimums.  The regulatory capital ratios as of September 30, 2022 are estimates, pending completion and filing of the Company's regulatory reports. 

Segment Disclosures

Segment disclosures on pages 18-20 of this press release provide additional detail on the Company's two operating segments: Core Banking and Mortgage Banking.

The Core Banking segment includes all lines of business, except Mortgage Banking, including commercial, retail, wealth management, as well as the operations, technology, and administrative functions of the Bank and Holding Company.  The Mortgage Banking segment includes the revenue earned from the production and sale of residential real estate loans, the servicing income from our serviced loan portfolio, the quarterly changes to the mortgage servicing rights (MSR) asset, and the specific expenses that are related to mortgage banking activities including variable commission expenses.  Revenue and related expenses for residential real estate loans held for investment are included in the Core Banking segment as portfolio loans are an anchor product for our consumer and wealth channels and are originated through a variety of channels throughout the Company.

Earnings Conference Call Information

The Company will host its third quarter 2022 earnings conference call on October 20, 2022, at 10:00 a.m. PT (1:00 p.m. ET).  During the call, the Company will provide an update on recent activities and discuss its third quarter 2022 financial results. Participants may register for the call using the below link to receive dial-in details and their own unique PINs or join the audiocast. It is recommended you join 10 minutes prior to the start time.

Register for the call: https://register.vevent.com/register/BI1c52bb4dbf56448d85316177a95883a3
Join the audiocast: https://edge.media-server.com/mmc/p/2ovipyh4
Access the replay through the Company's investor relations page: https://www.umpquabank.com/investor-relations/

About Umpqua Holdings Corporation

Umpqua Holdings Corporation (NASDAQ: UMPQ), headquartered in Portland, Oregon, is the parent company of Umpqua Bank, an Oregon-based regional bank that operates in Oregon, Washington, California, Idaho, Nevada, Arizona, and Colorado. Umpqua Bank has been recognized for its innovative customer experience and banking strategy by national publications including The Wall Street Journal, The New York Times, BusinessWeek, Fast Company and CNBC. The company was named #1 in Customer Satisfaction for the Northwest Region in the J.D. Power 2021 U.S. Retail Banking Satisfaction StudySM, and Forbes consistently ranks Umpqua as one of America's Best Banks. The Portland Business Journal has also recognized Umpqua as the Most Admired Financial Services Company in Oregon for seventeen consecutive years. In addition to its retail and commercial banking presence, Umpqua Bank owns Financial Pacific Leasing, Inc., a nationally recognized commercial finance company that provides equipment leases to businesses. For more information, visit umpquabank.com.

Forward-Looking Statements

This press release includes forward-looking statements within the meaning of the "Safe-Harbor" provisions of the Private Securities Litigation Reform Act of 1995, which management believes are a benefit to shareholders. These statements are necessarily subject to risk and uncertainty and actual results could differ materially due to various risk factors, including those set forth from time to time in our filings with the SEC. You should not place undue reliance on forward-looking statements and we undertake no obligation to update any such statements. Forward-looking statements can be identified by words such as "anticipates," "intends," "plans," "seeks," "believes," "estimates," "expects," "target," "projects," "outlook," "forecast," "will," "may," "could," "should," "can" and similar references to future periods. In this press release we make forward-looking statements about strategic and growth initiatives and the result of such activity. Risks that could cause results to differ from forward-looking statements we make are set forth in our filings with the SEC and include, without limitation: current and future economic and market conditions, including the effects of declines in housing and commercial real estate prices, high unemployment rates, inflation and any slowdown in economic growth particularly in the western United States; the effect of the COVID-19 pandemic, including on our credit quality and business operations, as well as its impact on general economic and financial market conditions; economic forecast variables that are either materially worse or better than end of quarter projections and deterioration in the economy that exceeds current consensus estimates; our ability to effectively manage problem credits; our ability to successfully implement efficiency and operational excellence initiatives; our ability to successfully develop and market new products and technology; changes in laws or regulations; the ability to complete, or any delays in completing, the proposed transaction between us and Columbia Banking System, Inc.; any failure to realize the anticipated benefits of the transaction when expected or at all; certain restrictions during the pendency of the proposed transaction that may impact our ability to pursue certain business opportunities or strategic transactions; the possibility that the transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events, diversion of management's attention from ongoing business operations and opportunities; and potential adverse reactions or changes to business or employee relationships, including those resulting from the completion of the transaction and integration of the companies. We also caution that the amount and timing of any future common stock dividends or repurchases will depend on the earnings, cash requirements and financial condition of the Company, market conditions, capital requirements, applicable law and regulations (including federal securities laws and federal banking regulations), and other factors deemed relevant by the Company's Board of Directors, and may be subject to regulatory approval or conditions.

____________________

1 "Non-GAAP" financial measure.  See GAAP to Non-GAAP Reconciliation for the comparable GAAP measurement.

2 "Non-GAAP" financial measure. See GAAP to Non-GAAP Reconciliation for the comparable GAAP measurement.

TABLE INDEX

Page

Consolidated Statements of Operations

7

Consolidated Balance Sheets

9

Financial Highlights

10

Loan & Lease Portfolio Balances and Mix

12

Deposit Balances, Mix, and Select Account Details

13

Credit Quality - Non-performing Assets

14

Credit Quality - Allowance for Credit Losses

14

Consolidated Average Balance Sheets, Net Interest Income, and Yields/Rates

17

Segments

19

GAAP to Non-GAAP Reconciliation

22

Umpqua Holdings Corporation

Consolidated Statements of Operations

(Unaudited)

Quarter Ended

% Change

(In thousands, except per share data)

Sep 30,
2022

Jun 30,
2022

Mar 31,
2022

Dec 31,
2021

Sep 30,
2021

Seq.

Quarter

Year
over
Year

Interest income:












Loans and leases

$     278,830

$     234,674

$     214,404

$     221,501

$     224,403

19 %

24 %

Interest and dividends on investments:












Taxable

18,175

17,256

18,725

16,566

16,102

5 %

13 %

Exempt from federal income tax

1,322

1,369

1,372

1,456

1,470

(3) %

(10) %

Dividends

86

84

86

102

213

2 %

(60) %

Temporary investments and interest bearing
deposits

5,115

2,919

1,353

1,229

1,237

75 %

314 %

Total interest income

303,528

256,302

235,940

240,854

243,425

18 %

25 %

Interest expense:












Deposits

9,090

4,015

3,916

4,357

5,100

126 %

78 %

Securities sold under agreement to
repurchase and federal funds purchased

545

66

63

48

88

nm

nm

Borrowings

798

50

49

51

149

nm

436 %

Junior subordinated debentures

5,491

4,001

3,149

3,019

3,014

37 %

82 %

Total interest expense

15,924

8,132

7,177

7,475

8,351

96 %

91 %

Net interest income

287,604

248,170

228,763

233,379

235,074

16 %

22 %

Provision (recapture) for credit losses

27,572

18,692

4,804

(736)

(18,919)

48 %

(246) %

Non-interest income:












Service charges on deposits

12,632

12,011

11,583

11,188

10,941

5 %

15 %

Card-based fees

9,115

10,530

8,708

9,355

9,111

(13) %

0 %

Brokerage revenue

27

27

11

31

31

0 %

(13) %

Residential mortgage banking revenue, net

17,341

30,544

60,786

43,185

34,150

(43) %

(49) %

Gain on sale of debt securities, net

—

—

2

4

—

nm

nm

Loss on equity securities, net

(2,647)

(2,075)

(2,661)

(466)

(343)

28 %

672 %

Gain on loan and lease sales, net

1,525

1,303

2,337

4,816

4,208

17 %

(64) %

BOLI income

2,023

2,110

2,087

2,101

2,038

(4) %

(1) %

Other (loss) income

(10,571)

785

(2,884)

12,524

13,569

nm

(178) %

Total non-interest income

29,445

55,235

79,969

82,738

73,705

(47) %

(60) %

Non-interest expense:












Salaries and employee benefits

109,164

110,942

113,138

117,477

117,636

(2) %

(7) %

Occupancy and equipment, net

35,042

34,559

34,829

34,310

33,944

1 %

3 %

Intangible amortization

1,025

1,026

1,025

1,130

1,130

0 %

(9) %

FDIC assessments

3,007

2,954

4,516

2,896

2,136

2 %

41 %

Merger related expenses

769

2,672

2,278

15,183

—

(71) %

nm

Other expenses

28,957

27,421

26,644

28,715

28,907

6 %

0 %

Total non-interest expense

177,964

179,574

182,430

199,711

183,753

(1) %

(3) %

Income before provision for income taxes

111,513

105,139

121,498

117,142

143,945

6 %

(23) %

Provision for income taxes

27,473

26,548

30,341

28,788

35,879

3 %

(23) %

Net income

$       84,040

$       78,591

$       91,157

$       88,354

$     108,066

7 %

(22) %














Weighted average basic shares outstanding

217,051

217,030

216,782

216,624

218,416

0 %

(1) %

Weighted average diluted shares outstanding

217,386

217,279

217,392

217,356

218,978

0 %

(1) %

Earnings per common share – basic

$           0.39

$           0.36

$           0.42

$           0.41

$           0.49

8 %

(20) %

Earnings per common share – diluted

$           0.39

$           0.36

$           0.42

$           0.41

$           0.49

8 %

(20) %














nm = not meaningful












Umpqua Holdings Corporation

Consolidated Statements of Operations

(Unaudited)


Nine Months Ended

% Change

(In thousands, except per share data)

Sep 30, 2022

Sep 30, 2021

Year over
Year

Interest income:





Loans and leases

$            727,908

$            669,014

9 %

Interest and dividends on investments:





Taxable

54,156

43,833

24 %

Exempt from federal income tax

4,063

4,491

(10) %

Dividends

256

1,216

(79) %

Temporary investments and interest bearing deposits

9,387

2,635

256 %

Total interest income

795,770

721,189

10 %

Interest expense:





Deposits

17,021

22,794

(25) %

Securities sold under agreement to repurchase and federal funds purchased

674

232

191 %

Borrowings

897

2,787

(68) %

Junior subordinated debentures

12,641

9,108

39 %

Total interest expense

31,233

34,921

(11) %

Net interest income

764,537

686,268

11 %

Provision (recapture) for credit losses

51,068

(41,915)

(222) %

Non-interest income:





Service charges on deposits

36,226

30,898

17 %

Card-based fees

28,353

26,759

6 %

Brokerage revenue

65

5,081

(99) %

Residential mortgage banking revenue, net

108,671

143,626

(24) %

Gain on sale of debt securities, net

2

4

(50) %

Loss on equity securities, net

(7,383)

(1,045)

nm

Gain on loan and lease sales, net

5,165

10,899

(53) %

BOLI income

6,220

6,201

0 %

Other (loss) income

(12,670)

51,157

(125) %

Total non-interest income

164,649

273,580

(40) %

Non-interest expense:





Salaries and employee benefits

333,244

363,343

(8) %

Occupancy and equipment, net

104,430

103,236

1 %

Intangible amortization

3,076

3,390

(9) %

FDIC assessments

10,477

6,342

65 %

Merger related expenses

5,719

—

nm

Other expenses

83,022

84,434

(2) %

Total non-interest expense

539,968

560,745

(4) %

Income before provision for income taxes

338,150

441,018

(23) %

Provision for income taxes

84,362

109,072

(23) %

Net income

$            253,788

$            331,946

(24) %







Weighted average basic shares outstanding

216,955

219,791

(1) %

Weighted average diluted shares outstanding

217,353

220,278

(1) %

Earnings per common share – basic

$                 1.17

$                 1.51

(23) %

Earnings per common share – diluted

$                 1.17

$                 1.51

(23) %







nm = not meaningful





Umpqua Holdings Corporation

Consolidated Balance Sheets

(Unaudited)











% Change

(In thousands, except per share
data)

Sep 30, 2022

Jun 30, 2022

Mar 31, 2022

Dec 31, 2021

Sep 30, 2021

Seq.

Quarter

Year
over
Year

Assets:












Cash and due from banks

$     321,447

$     315,348

$     307,144

$     222,015

$     395,555

2 %

(19) %

Interest bearing cash and temporary
investments

1,232,412

687,233

2,358,292

2,539,606

3,349,034

79 %

(63) %

Investment securities:












Equity and other, at fair value

72,277

75,347

78,966

81,214

81,575

(4) %

(11) %

Available for sale, at fair value

3,136,391

3,416,707

3,638,080

3,870,435

3,723,171

(8) %

(16) %

Held to maturity, at amortized cost

2,547

2,637

2,700

2,744

2,795

(3) %

(9) %

Loans held for sale

148,275

228,889

309,946

353,105

352,466

(35) %

(58) %

Loans and leases

25,507,951

24,432,678

22,975,761

22,553,180

21,969,940

4 %

16 %

Allowance for credit losses on loans
and leases

(283,065)

(261,111)

(248,564)

(248,412)

(257,560)

8 %

10 %

Net loans and leases

25,224,886

24,171,567

22,727,197

22,304,768

21,712,380

4 %

16 %

Restricted equity securities

40,993

10,867

10,889

10,916

10,946

277 %

275 %

Premises and equipment, net

165,305

165,196

167,369

171,125

172,624

0 %

(4) %

Operating lease right-of-use assets

81,729

87,249

87,333

82,366

88,379

(6) %

(8) %

Other intangible assets, net

5,764

6,789

7,815

8,840

9,970

(15) %

(42) %

Residential mortgage servicing
rights, at fair value

196,177

179,558

165,807

123,615

105,834

9 %

85 %

Bank owned life insurance

329,699

328,764

328,040

327,745

325,646

0 %

1 %

Deferred tax asset, net

128,120

70,134

39,051

—

8,402

83 %

nm

Other assets

385,938

389,409

408,497

542,442

552,702

(1) %

(30) %

Total assets

$  31,471,960

$  30,135,694

$  30,637,126

$  30,640,936

$  30,891,479

4 %

2 %

Liabilities:












Deposits

$  26,817,107

$  26,132,423

$  26,699,587

$  26,594,685

$  26,908,397

3 %

0 %

Securities sold under agreements to
repurchase

383,569

527,961

499,539

492,247

467,760

(27) %

(18) %

Borrowings

756,214

6,252

6,290

6,329

6,367

nm

nm

Junior subordinated debentures, at
fair value

325,744

321,268

305,719

293,081

299,508

1 %

9 %

Junior subordinated debentures, at
amortized cost

87,870

87,927

87,984

88,041

88,098

0 %

0 %

Operating lease liabilities

95,512

101,352

101,732

95,427

100,557

(6) %

(5) %

Deferred tax liability, net

—

—

—

4,353

—

nm

nm

Other liabilities

588,430

440,235

328,677

317,503

298,413

34 %

97 %

Total liabilities

29,054,446

27,617,418

28,029,528

27,891,666

28,169,100

5 %

3 %

Shareholders' equity:












Common stock

3,448,007

3,445,531

3,443,266

3,444,849

3,442,085

0 %

0 %

Accumulated deficit

(580,933)

(619,108)

(651,912)

(697,338)

(739,915)

(6) %

(21) %

Accumulated other comprehensive
(loss) income

(449,560)

(308,147)

(183,756)

1,759

20,209

46 %

nm

Total shareholders' equity

2,417,514

2,518,276

2,607,598

2,749,270

2,722,379

(4) %

(11) %

Total liabilities and shareholders' equity

$  31,471,960

$  30,135,694

$  30,637,126

$  30,640,936

$  30,891,479

4 %

2 %














Common shares outstanding at period
end

217,053

217,049

216,967

216,626

216,622

0 %

0 %

Book value per common share

$         11.14

$         11.60

$         12.02

$         12.69

$         12.57

(4) %

(11) %

Tangible book value per common
share (1)

$         11.11

$         11.57

$         11.98

$         12.65

$         12.52

(4) %

(11) %

Tangible equity - common (1)

$  2,411,750

$  2,511,487

$  2,599,783

$  2,740,430

$  2,712,409

(4) %

(11) %

Tangible common equity to tangible
assets (1)

7.66 %

8.34 %

8.49 %

8.95 %

8.78 %

(0.68)

(1.12)

nm = not meaningful













(1) See GAAP to Non-GAAP Reconciliation.

Umpqua Holdings Corporation

Financial Highlights

(Unaudited)


Quarter Ended

% Change


Sep 30,
2022

Jun 30,
2022

Mar 31,
2022

Dec 31,
2021

Sep 30,
2021

Seq.
Quarter

Year over
Year

Per Common Share Data:













Dividends

$    0.21

$    0.21

$    0.21

$    0.21

$    0.21

0 %

0 %

Book value

$  11.14

$  11.60

$  12.02

$  12.69

$  12.57

(4) %

(11) %

Tangible book value (1)

$  11.11

$  11.57

$  11.98

$  12.65

$  12.52

(4) %

(11) %

Tangible book value, ex accumulated other
comprehensive income (1)

$  13.18

$  12.99

$  12.83

$  12.64

$  12.43

1 %

6 %















Performance Ratios:













Efficiency ratio

56.07 %

59.12 %

59.02 %

63.10 %

59.44 %

(3.05)

(3.37)

Pre-provision net revenue (PPNR) ROAA (1)

1.80 %

1.64 %

1.67 %

1.50 %

1.62 %

0.16

0.18

Return on average assets (ROAA)

1.09 %

1.04 %

1.21 %

1.13 %

1.40 %

0.05

(0.31)

Return on average common equity

12.99 %

12.20 %

13.62 %

12.90 %

15.82 %

0.79

(2.83)

Return on average tangible common equity (1)

13.02 %

12.23 %

13.66 %

12.94 %

15.88 %

0.79

(2.86)















Performance Ratios - Operating: (1)













Operating efficiency ratio (1)

51.72 %

58.27 %

62.02 %

59.61 %

58.94 %

(6.55)

(7.22)

Operating PPNR return on average assets (1)

2.12 %

1.66 %

1.43 %

1.58 %

1.62 %

0.46

0.50

Operating return on average assets (1)

1.33 %

1.06 %

1.03 %

1.23 %

1.40 %

0.27

(0.07)

Operating return on average common equity (1)

15.86 %

12.46 %

11.58 %

13.98 %

15.82 %

3.40

0.04

Operating return on average tangible common equity (1)

15.90 %

12.49 %

11.62 %

14.03 %

15.88 %

3.41

0.02















Average Balance Sheet Yields, Rates, & Ratios:













Yield on loans and leases

4.41 %

3.94 %

3.79 %

3.94 %

4.02 %

0.47

0.39

Yield on earning assets (2)

4.10 %

3.53 %

3.24 %

3.25 %

3.32 %

0.57

0.78

Cost of interest bearing deposits

0.23 %

0.11 %

0.10 %

0.11 %

0.13 %

0.12

0.10

Cost of interest bearing liabilities

0.39 %

0.20 %

0.18 %

0.18 %

0.20 %

0.19

0.19

Cost of total deposits

0.14 %

0.06 %

0.06 %

0.06 %

0.08 %

0.08

0.06

Cost of total funding (3)

0.23 %

0.12 %

0.11 %

0.11 %

0.12 %

0.11

0.11

Net interest margin (2)

3.88 %

3.41 %

3.14 %

3.15 %

3.21 %

0.47

0.67

Average interest bearing cash / Average interest
earning assets

3.04 %

5.71 %

8.92 %

10.78 %

11.03 %

(2.67)

(7.99)

Average loans and leases / Average interest earning
assets

84.54 %

80.91 %

76.85 %

74.70 %

74.78 %

3.63

9.76

Average loans and leases / Average total deposits

93.55 %

89.23 %

84.77 %

82.12 %

82.07 %

4.32

11.48

Average non-interest bearing deposits / Average total
deposits

42.29 %

42.00 %

41.35 %

41.69 %

41.14 %

0.29

1.15

Average total deposits / Average total funding (3)

96.34 %

96.66 %

96.82 %

96.84 %

96.72 %

(0.32)

(0.38)















Select Credit & Capital Ratios:













Non-performing loans and leases to total loans and
leases

0.20 %

0.18 %

0.18 %

0.23 %

0.24 %

0.02

(0.04)

Non-performing assets to total assets

0.16 %

0.15 %

0.14 %

0.17 %

0.17 %

0.01

(0.01)

Allowance for credit losses to loans and leases

1.16 %

1.12 %

1.14 %

1.16 %

1.23 %

0.04

(0.07)

Total risk-based capital ratio (4)

13.2 %

13.5 %

14.0 %

14.3 %

14.9 %

(0.30)

(1.70)

Common equity tier 1 risk-based capital ratio (4)

10.7 %

11.0 %

11.4 %

11.6 %

12.0 %

(0.30)

(1.30)


(1) See GAAP to Non-GAAP Reconciliation.

(2) Tax exempt interest has been adjusted to a taxable equivalent basis using a 21% tax rate.

(3) Total funding = Total deposits + Total borrowings.

(4) Estimated holding company ratios.

Umpqua Holding Corporation

Financial Highlights

(Unaudited)


Nine Months Ended

% Change


Sep 30, 2022

Sep 30, 2021

Year over Year

Per Common Share Data:





Dividends

$             0.63

$             0.63

— %







Performance Ratios:





Efficiency ratio

58.05 %

58.35 %

(0.30)

Pre-provision net revenue (PPNR) ROAA (1)

1.70 %

1.78 %

(0.08)

Return on average assets (ROAA)

1.11 %

1.48 %

(0.37)

Return on average common equity

12.94 %

16.47 %

(3.53)

Return on average tangible common equity (1)

12.98 %

16.55 %

(3.57)







Performance Ratios - Operating: (1)





Operating efficiency ratio (1)

57.03 %

57.88 %

(0.85)

Operating PPNR return on average assets (1)

1.74 %

1.78 %

(0.04)

Operating return on average assets (1)

1.14 %

1.48 %

(0.34)

Operating return on average common equity (1)

13.28 %

16.49 %

(3.21)

Operating return on average tangible common equity (1)

13.32 %

16.57 %

(3.25)







Average Balance Sheet Yields, Rates, & Ratios:





Yield on loans and leases

4.06 %

4.01 %

0.05

Yield on earning assets (2)

3.62 %

3.36 %

0.26

Cost of interest bearing deposits

0.15 %

0.20 %

(0.05)

Cost of interest bearing liabilities

0.26 %

0.28 %

(0.02)

Cost of total deposits

0.09 %

0.12 %

(0.03)

Cost of total funding (3)

0.15 %

0.17 %

(0.02)

Net interest margin (2)

3.48 %

3.20 %

0.28

Average interest bearing cash / Average interest earning assets

5.87 %

9.93 %

(4.06)

Average loans and leases / Average interest earning assets

80.80 %

76.16 %

4.64

Average loans and leases / Average total deposits

89.21 %

84.34 %

4.87

Average non-interest bearing deposits / Average total deposits

41.89 %

40.44 %

1.45

Average total deposits / Average total funding (3)

96.61 %

96.04 %

0.57

(1) See GAAP to Non-GAAP Reconciliation.

(2) Tax exempt interest has been adjusted to a taxable equivalent basis using a 21% tax rate.

(3) Total funding = Total deposits + Total borrowings.

Umpqua Holdings Corporation

Loan & Lease Portfolio Balances and Mix

(Unaudited)

Sep 30, 2022

Jun 30, 2022

Mar 31, 2022

Dec 31, 2021

Sep 30, 2021

% Change

 (Dollars in thousands)

Amount

Amount

Amount

Amount

Amount

Seq.
Quarter

Year
over
Year

Loans and leases:












Commercial real estate:












Non-owner occupied term, net

$  3,846,426

$  3,798,242

$  3,884,784

$  3,786,887

$  3,561,764

1 %

8 %

Owner occupied term, net

2,549,761

2,497,553

2,327,899

2,332,422

2,330,338

2 %

9 %

Multifamily, net

5,090,661

4,768,273

4,323,633

4,051,202

3,813,024

7 %

34 %

Construction & development, net

1,036,931

1,017,297

940,286

890,338

882,778

2 %

17 %

Residential development, net

205,935

194,909

195,308

206,990

177,148

6 %

16 %

Commercial:












Term, net (1)

3,003,424

2,904,861

2,772,206

3,008,473

3,159,466

3 %

(5) %

Lines of credit & other, net

914,507

920,604

871,483

910,733

930,350

(1) %

(2) %

Leases & equipment finance, net

1,669,817

1,576,144

1,484,252

1,467,676

1,457,248

6 %

15 %

Residential:












Mortgage, net

5,470,624

5,168,457

4,748,266

4,517,266

4,330,860

6 %

26 %

Home equity loans & lines, net

1,565,094

1,415,722

1,250,702

1,197,170

1,133,823

11 %

38 %

   Consumer & other, net

154,771

170,616

176,942

184,023

193,141

(9) %

(20) %

Total loans and leases, net of
deferred fees and costs

$  25,507,951

$  24,432,678

$  22,975,761

$  22,553,180

$  21,969,940

4 %

16 %














(1)  The Bank participated in the Payroll Protection Program to originate SBA loans designated to help businesses maintain their workforce and cover other working capital needs during the COVID-19 pandemic. The Commercial Term loans in the table above include the following net PPP loan balances:

Net PPP loan balance

$       37,949

$     101,554

$     172,790

$     380,440

$     726,737

(63) %

(95) %














Loan and leases mix:












Commercial real estate:












   Non-owner occupied term, net

15 %

15 %

17 %

17 %

16 %



   Owner occupied term, net

10 %

10 %

10 %

10 %

11 %



   Multifamily, net

20 %

20 %

19 %

18 %

17 %



Construction & development, net

4 %

4 %

4 %

4 %

4 %



Residential development, net

1 %

1 %

1 %

1 %

1 %



Commercial:












Term, net

12 %

12 %

12 %

13 %

14 %



Lines of credit & other, net

4 %

4 %

4 %

4 %

4 %



Leases & equipment finance, net

6 %

6 %

6 %

7 %

7 %



Residential:












Mortgage, net

21 %

21 %

21 %

20 %

20 %



Home equity loans & lines, net

6 %

6 %

5 %

5 %

5 %



   Consumer & other, net

1 %

1 %

1 %

1 %

1 %



Total

100 %

100 %

100 %

100 %

100 %



Umpqua Holdings Corporation

Deposit Balances, Mix, and Select Account Details

(Unaudited)

Sep 30, 2022

Jun 30, 2022

Mar 31, 2022

Dec 31, 2021

Sep 30, 2021

% Change

 (Dollars in thousands)

Amount

Amount

Amount

Amount

Amount

Seq.
Quarter

Year
over
Year

Deposits:












Demand, non-interest bearing

$  11,246,358

$  11,129,209

$  11,058,251

$  11,023,724

$  11,121,127

1 %

1 %

Demand, interest bearing

3,903,746

3,723,650

3,955,329

3,774,937

3,758,019

5 %

4 %

Money market

7,601,506

7,284,641

7,572,581

7,611,718

7,780,442

4 %

(2) %

Savings

2,455,917

2,446,876

2,429,073

2,375,723

2,325,929

0 %

6 %

Time

1,609,580

1,548,047

1,684,353

1,808,583

1,922,880

4 %

(16) %

Total

$  26,817,107

$  26,132,423

$  26,699,587

$  26,594,685

$  26,908,397

3 %

0 %














Total core deposits (1)

$  26,292,548

$  25,619,500

$  26,140,993

$  25,964,358

$  26,029,814

3 %

1 %














Deposit mix:












Demand, non-interest bearing

42 %

43 %

42 %

41 %

41 %



Demand, interest bearing

15 %

14 %

15 %

14 %

14 %



Money market

28 %

28 %

28 %

29 %

29 %



Savings

9 %

9 %

9 %

9 %

9 %



Time

6 %

6 %

6 %

7 %

7 %



Total

100 %

100 %

100 %

100 %

100 %

















Number of open accounts:












Demand, non-interest bearing

434,347

434,436

428,915

428,181

425,337



Demand, interest bearing

56,698

57,145

63,800

66,010

70,749



Money market

55,712

56,430

56,783

57,222

57,794



Savings

159,008

159,709

160,267

160,449

161,698



Time

32,202

32,103

34,127

35,665

37,172



Total

737,967

739,823

743,892

747,527

752,750

















Average balance per account:












Demand, non-interest bearing

$           25.9

$           25.6

$           25.8

$           25.7

$           26.1



Demand, interest bearing

68.9

65.2

62.0

57.2

53.1



Money market

136.4

129.1

133.4

133.0

134.6



Savings

15.4

15.3

15.2

14.8

14.4



Time

50.0

48.2

49.4

50.7

51.7



Total

$           36.3

$           35.3

$           35.9

$           35.6

$           35.7




(1) Core deposits are defined as total deposits less time deposits greater than $250,000 and all brokered deposits.

Umpqua Holdings Corporation

Credit Quality – Non-performing Assets

 (Unaudited)



Quarter Ended

% Change

(Dollars in thousands)

Sep 30,
2022

Jun 30,
2022

Mar 31,
2022

Dec 31,
2021

Sep 30,
2021

Seq.
Quarter

Year
over
Year

Non-performing assets:













Loans and leases on non-accrual status:














Commercial real estate, net

$      5,403

$      5,514

$      5,950

$      5,767

$      5,952

(2) %

(9) %

Commercial, net

18,652

12,645

12,415

13,098

18,200

48 %

2 %

Residential, net

—

—

—

—

—

nm

nm

Consumer & other, net

—

—

—

—

—

nm

nm

Total loans and leases on non-accrual
status

24,055

18,159

18,365

18,865

24,152

32 %

0 %

Loans and leases past due 90+ days and
accruing (1):














Commercial real estate, net

1

23

1

1

1

(96) %

0 %

Commercial, net

5,143

3,311

8

4,160

2,454

55 %

110 %

Residential, net (1)

21,411

22,340

23,162

27,981

24,919

(4) %

(14) %

Consumer & other, net

152

196

111

194

116

(22) %

31 %

Total loans and leases past due 90+
days and accruing (1)

26,707

25,870

23,282

32,336

27,490

3 %

(3) %

Total non-performing loans and leases

50,762

44,029

41,647

51,201

51,642

15 %

(2) %

Other real estate owned

—

1,868

1,868

1,868

1,868

(100) %

(100) %

Total non-performing assets

$    50,762

$    45,897

$    43,515

$    53,069

$    53,510

11 %

(5) %
















Performing restructured loans and leases

$      7,076

$      7,631

$      8,405

$      6,694

$      9,849

(7) %

(28) %

Loans and leases past due 31-89 days

$    53,538

$    34,659

$    42,409

$    31,680

$    41,326

54 %

30 %

Loans and leases past due 31-89 days to
total loans and leases

0.21 %

0.14 %

0.18 %

0.14 %

0.19 %

0.07

0.02

Non-performing loans and leases to total
loans and leases (1)

0.20 %

0.18 %

0.18 %

0.23 %

0.24 %

0.02

(0.04)

Non-performing assets to total assets (1)

0.16 %

0.15 %

0.14 %

0.17 %

0.17 %

0.01

(0.01)

nm = not meaningful














(1)  Excludes certain mortgage loans guaranteed by Ginnie Mae, which Umpqua has the unilateral right to repurchase but has not done so, totaling $1.0 million and $356,000 at September 30, 2022 and June 30, 2022, respectively.

Umpqua Holdings Corporation

Credit Quality – Allowance for Credit Losses

(Unaudited)



Quarter Ended

% Change

(Dollars in thousands)

Sep 30,
2022

Jun 30,
2022

Mar 31,
2022

Dec 31,
2021

Sep 30,
2021

Seq.
Quarter

Year over
Year

Allowance for credit losses on loans and
leases (ACLLL)













Balance, beginning of period

$ 261,111

$ 248,564

$ 248,412

$ 257,560

$ 279,887

5 %

(7) %

Provision (recapture) for credit losses on
loans and leases


28,542

18,787

5,696

(1,751)

(16,132)

52 %

(277) %

Charge-offs














Commercial real estate, net

—

(8)

—

(58)

(916)

(100) %

(100) %

Commercial, net

(9,459)

(9,035)

(7,858)

(10,197)

(8,521)

5 %

11 %

Residential, net

(4)

—

(167)

—

—

nm

nm

Consumer & other, net

(929)

(836)

(885)

(675)

(936)

11 %

(1) %

Total charge-offs

(10,392)

(9,879)

(8,910)

(10,930)

(10,373)

5 %

0 %

Recoveries














Commercial real estate, net

123

73

25

56

120

68 %

2 %

Commercial, net

2,842

2,934

2,545

2,585

3,346

(3) %

(15) %

Residential, net

249

216

173

326

281

15 %

(11) %

Consumer & other, net

590

416

623

566

431

42 %

37 %

Total recoveries


3,804

3,639

3,366

3,533

4,178

5 %

(9) %

Net (charge-offs) recoveries














Commercial real estate, net

123

65

25

(2)

(796)

89 %

(115) %

Commercial, net

(6,617)

(6,101)

(5,313)

(7,612)

(5,175)

8 %

28 %

Residential, net

245

216

6

326

281

13 %

(13) %

Consumer & other, net

(339)

(420)

(262)

(109)

(505)

(19) %

(33) %

Total net charge-offs

(6,588)

(6,240)

(5,544)

(7,397)

(6,195)

6 %

6 %

Balance, end of period

$ 283,065

$ 261,111

$ 248,564

$ 248,412

$ 257,560

8 %

10 %

Reserve for unfunded commitments













Balance, beginning of period

$   12,823

$   12,918

$   12,767

$   11,752

$   14,539

(1) %

(12) %

(Recapture) provision for credit losses on
unfunded commitments


(970)

(95)

151

1,015

(2,787)

921 %

(65) %

Balance, end of period

11,853

12,823

12,918

12,767

11,752

(8) %

1 %

Total Allowance for credit losses (ACL)

$ 294,918

$ 273,934

$ 261,482

$ 261,179

$ 269,312

8 %

10 %















Net charge-offs to average loans and leases
(annualized)

0.11 %

0.11 %

0.10 %

0.13 %

0.11 %

—

—

Recoveries to gross charge-offs

36.61 %

36.84 %

37.78 %

32.32 %

40.28 %

(0.23)

(3.67)

ACLLL to loans and leases

1.11 %

1.07 %

1.08 %

1.10 %

1.17 %

0.04

(0.06)

ACL to loans and leases

1.16 %

1.12 %

1.14 %

1.16 %

1.23 %

0.04

(0.07)

nm = not meaningful













Umpqua Holdings Corporation

Credit Quality – Allowance for Credit Losses

(Unaudited)


Nine Months Ended

% Change

(Dollars in thousands)

Sep 30, 2022

Sep 30, 2021

Year over Year

Allowance for credit losses on loans and leases (ACLLL)





Balance, beginning of period

$        248,412

$        328,401

(24) %

Provision (recapture) for credit losses on loans and leases 

53,025

(33,381)

(259) %

Charge-offs






Commercial real estate, net

(8)

(1,086)

(99) %

Commercial, net

(26,352)

(44,228)

(40) %

Residential, net

(171)

(70)

144 %

Consumer & other, net

(2,650)

(2,983)

(11) %

Total charge-offs

(29,181)

(48,367)

(40) %

Recoveries






Commercial real estate, net

221

589

(62) %

Commercial, net

8,321

8,118

3 %

Residential, net

638

598

7 %

Consumer & other, net

1,629

1,602

2 %

Total recoveries

10,809

10,907

(1) %

Net (charge-offs) recoveries






Commercial real estate, net

213

(497)

(143) %

Commercial, net

(18,031)

(36,110)

(50) %

Residential, net

467

528

(12) %

Consumer & other, net

(1,021)

(1,381)

(26) %

Total net charge-offs

(18,372)

(37,460)

(51) %

Balance, end of period

$        283,065

$        257,560

10 %

Reserve for unfunded commitments





Balance, beginning of period

$          12,767

$          20,286

(37) %

(Recapture) provision for credit losses on unfunded commitments


(914)

(8,534)

(89) %

Balance, end of period

11,853

11,752

1 %

Total Allowance for credit losses (ACL)

$        294,918

$        269,312

10 %







Net charge-offs to average loans and leases (annualized)

0.10 %

0.23 %

(0.13)

Recoveries to gross charge-offs

37.04 %

22.55 %

14.49

nm = not meaningful












Umpqua Holdings Corporation
Consolidated Average Balance Sheets, Net Interest Income, and Yields/Rates

(Unaudited)

Quarter Ended

September 30, 2022

June 30, 2022

September 30, 2021

 (Dollars in thousands)

Average
Balance

Interest
Income
or
Expense

Average
Yields
or Rates

Average
Balance

Interest
Income
or
Expense

Average
Yields
or Rates

Average
Balance

Interest
Income
or
Expense

Average
Yields
or Rates

INTEREST-EARNING
ASSETS:
















Loans held for sale

$     173,397

$    2,205

5.09 %

$     264,320

$    2,742

4.15 %

$     465,805

$    3,672

3.15 %

Loans and leases (1)

24,886,203

276,625

4.41 %

23,550,796

231,932

3.94 %

21,864,387

220,731

4.02 %

Taxable securities

3,271,185

18,261

2.23 %

3,410,091

17,340

2.03 %

3,436,895

16,315

1.90 %

Non-taxable securities (2)

212,847

1,651

3.10 %

220,327

1,721

3.13 %

245,904

1,848

3.01 %

Temporary investments
and interest-bearing cash

893,471

5,115

2.27 %

1,663,454

2,919

0.70 %

3,224,846

1,237

0.15 %

Total interest-earning
assets

29,437,103

$  303,857

4.10 %

29,108,988

$  256,654

3.53 %

29,237,837

$  243,803

3.32 %

Other assets

1,231,074




1,247,915




1,376,537



Total assets

$  30,668,177




$  30,356,903




$  30,614,374



INTEREST-BEARING
LIABILITIES:
















Interest-bearing demand
deposits

$  3,829,688

$    1,705

0.18 %

$  3,896,553

$       610

0.06 %

$  3,564,040

$       468

0.05 %

Money market deposits

7,550,791

5,817

0.31 %

7,366,987

1,717

0.09 %

7,800,144

1,492

0.08 %

Savings deposits

2,468,187

250

0.04 %

2,426,124

199

0.03 %

2,284,077

206

0.04 %

Time deposits

1,501,724

1,318

0.35 %

1,618,394

1,489

0.37 %

2,031,494

2,934

0.57 %

Total interest-bearing
deposits

15,350,390

9,090

0.23 %

15,308,058

4,015

0.11 %

15,679,755

5,100

0.13 %

Repurchase agreements
and federal funds
purchased

509,559

545

0.42 %

512,641

66

0.05 %

496,822

88

0.07 %

Borrowings

90,475

798

3.50 %

6,273

50

3.21 %

31,500

149

1.88 %

Junior subordinated
debentures

409,151

5,491

5.33 %

393,964

4,001

4.07 %

375,726

3,014

3.18 %

Total interest-bearing
liabilities

16,359,575

$  15,924

0.39 %

16,220,936

$    8,132

0.20 %

16,583,803

$    8,351

0.20 %

Non-interest-bearing
deposits

11,250,764




11,086,376




10,960,686



Other liabilities

490,572




464,755




360,244



Total liabilities

28,100,911




27,772,067




27,904,733



Common equity

2,567,266




2,584,836




2,709,641



Total liabilities and
shareholders' equity

$  30,668,177




$  30,356,903




$  30,614,374



NET INTEREST INCOME

$  287,933




$  248,522




$  235,452

NET INTEREST SPREAD



3.71 %




3.33 %




3.12 %

NET INTEREST INCOME
TO EARNING ASSETS OR
NET INTEREST MARGIN
(1), (2)



3.88 %




3.41 %




3.21 %

(1)  Non-accrual loans and leases are included in the average balance.   

(2)  Tax-exempt income has been adjusted to a tax equivalent basis at a 21% tax rate. The amount of such adjustment was an addition to recorded income of approximately $329,000 for the three months ended September 30, 2022, as compared to $352,000 for June 30, 2022 and $377,000 for September 30, 2021. 

Umpqua Holdings Corporation
Average Rates and Balances

(Unaudited)

(dollars in thousands)

Nine Months Ended

September 30, 2022

September 30, 2021

Average
Balance

Interest
Income or
Expense

Average
Yields or
Rates

Average
Balance

Interest
Income or
Expense

Average
Yields or
Rates

INTEREST-EARNING ASSETS:










Loans held for sale

$        240,928

$        7,209

3.99 %

$        545,237

$      12,242

2.99 %

Loans and leases (1)

23,676,201

720,699

4.06 %

21,866,569

656,772

4.01 %

Taxable securities

3,445,386

54,412

2.11 %

3,199,653

45,049

1.88 %

Non-taxable securities (2)

222,375

5,098

3.06 %

248,617

5,627

3.02 %

Temporary investments and interest-bearing cash

1,718,832

9,387

0.73 %

2,850,639

2,635

0.12 %

Total interest-earning assets

29,303,722

$    796,805

3.62 %

28,710,715

$    722,325

3.36 %

Other assets

1,237,305




1,348,054



Total assets

$   30,541,027




$   30,058,769



INTEREST-BEARING LIABILITIES:










Interest-bearing demand deposits

$     3,846,202

$        2,813

0.10 %

$     3,359,865

$        1,341

0.05 %

Money market deposits

7,519,200

8,942

0.16 %

7,593,320

4,516

0.08 %

Savings deposits

2,433,651

654

0.04 %

2,152,667

523

0.03 %

Time deposits

1,623,742

4,612

0.38 %

2,336,261

16,414

0.94 %

Total interest-bearing deposits

15,422,795

17,021

0.15 %

15,442,113

22,794

0.20 %

Repurchase agreements and federal funds
purchased

502,998

674

0.18 %

444,919

232

0.07 %

Borrowings

34,662

897

3.46 %

259,890

2,787

1.43 %

Junior subordinated debentures

394,803

12,641

4.28 %

363,122

9,108

3.35 %

Total interest-bearing liabilities

16,355,258

$      31,233

0.26 %

16,510,044

$      34,921

0.28 %

Non-interest-bearing deposits

11,115,618




10,484,104



Other liabilities

448,426




369,653



Total liabilities

27,919,302




27,363,801



Common equity

2,621,725




2,694,968



Total liabilities and shareholders' equity

$   30,541,027




$   30,058,769



NET INTEREST INCOME

$    765,572




$    687,404

NET INTEREST SPREAD



3.36 %




3.08 %

NET INTEREST INCOME TO EARNING ASSETS
OR NET INTEREST MARGIN (1), (2)



3.48 %




3.20 %














(1)  Non-accrual loans and leases are included in the average balance.

(2)  Tax-exempt income has been adjusted to a tax equivalent basis at a 21% tax rate. The amount of such adjustment was an addition to recorded income of approximately $1.0 million for the nine months ended September 30, 2022, as compared to $1.1 million for the same period in 2021.

Umpqua Holdings Corporation

Segments

(Unaudited)

Core Banking

Quarter Ended

% Change

(Dollars in thousands)

Sep 30, 2022

Jun 30, 2022

Mar 31, 2022

Dec 31, 2021

Sep 30, 2021

Seq.
Quarter

Year
over
Year

Net interest income

$     286,532

$     247,009

$     227,087

$     231,250

$     232,348

16 %

23 %

Provision (recapture) for credit
losses

27,572

18,692

4,804

(736)

(18,919)

48 %

(246) %

Non-interest income













Gain on sale of debt securities,
net

—

—

2

4

—

nm

nm

Loss on equity securities, net

(2,647)

(2,075)

(2,661)

(466)

(343)

28 %

672 %

Gain (loss) on swap derivatives,
net

4,194

7,337

7,047

(303)

1,429

(43) %

193 %

Change in fair value of certain
loans held for investment

(26,397)

(15,210)

(21,049)

(2,672)

3,432

74 %

(869) %

Non-interest income (excluding
above items)

36,769

34,461

35,650

42,812

34,849

7 %

6 %

Total non-interest income

11,919

24,513

18,989

39,375

39,367

(51) %

(70) %

Non-interest expense













Merger related expenses

769

2,672

2,278

15,183

—

(71) %

nm

Exit and disposal costs

1,364

442

3,033

3,022

3,813

209 %

(64) %

Non-interest expense (excluding
above items)

154,320

148,946

148,423

150,587

146,931

4 %

5 %

Allocated expenses, net (1)

(39)

3,702

3,735

4,314

3,680

(101) %

(101) %

Total non-interest expense

156,414

155,762

157,469

173,106

154,424

0 %

1 %

Income before income taxes

114,465

97,068

83,803

98,255

136,210

18 %

(16) %

Provision for income taxes

28,212

24,530

20,917

24,067

33,945

15 %

(17) %

Net income

$       86,253

$       72,538

$       62,886

$       74,188

$     102,265

19 %

(16) %

Effective Tax Rate

25 %

25 %

25 %

24 %

25 %



Efficiency Ratio

52 %

57 %

64 %

64 %

57 %



Total assets

$  31,100,700

$  29,721,590

$  30,153,079

$  30,155,058

$  30,419,108

5 %

2 %

Total loans and leases

$  25,507,951

$  24,432,678

$  22,975,761

$  22,553,180

$  21,969,940

4 %

16 %

Total deposits

$  26,588,217

$  25,925,294

$  26,479,078

$  26,370,568

$  26,510,938

3 %

0 %

Key Rates, end of period:












10 year CMT

3.83 %

2.98 %

2.32 %

1.52 %

1.52 %

0.85

2.31

FHLMC 30 year fixed

6.70 %

5.70 %

4.67 %

3.11 %

3.01 %

1.00

3.69

nm = not meaningful












(1) Represents the internal charges for centrally provided support services and other corporate overhead to the Mortgage Banking segment, partially offset by allocations from the Mortgage Banking segment to Core Banking for new portfolio loan originations and portfolio servicing costs.

Umpqua Holdings Corporation

Segments - Continued

(Unaudited)

Mortgage Banking

Quarter Ended

% Change

(Dollars in thousands)

Sep 30, 2022

Jun 30, 2022

Mar 31, 2022

Dec 31, 2021

Sep 30, 2021

Seq.
Quarter

Year
over
Year

Net interest income

$         1,072

$         1,161

$         1,676

$         2,129

$         2,726

(8) %

(61) %

Provision for credit losses

—

—

—

—

—

nm

nm

Non-interest income













Residential mortgage banking
revenue:













Origination and sale

10,515

15,101

16,844

23,624

30,293

(30) %

(65) %

Servicing

9,529

9,505

9,140

9,457

9,172

0 %

4 %

Change in fair value of MSR
asset:













Changes due to
collection/realization of expected
cash flows over time

(4,978)

(4,961)

(5,347)

(5,311)

(4,681)

0 %

6 %

Changes due to valuation inputs
or assumptions

16,403

10,899

40,149

15,415

(634)

51 %

(2,687) %

MSR hedge loss

(14,128)

—

—

—

—

nm

nm

Non-interest income (excluding
above items)

185

178

194

178

188

4 %

(2) %

Total non-interest income

17,526

30,722

60,980

43,363

34,338

(43) %

(49) %

Non-interest expense













Non-interest expense

21,511

27,514

28,696

30,919

33,009

(22) %

(35) %

Allocated expenses, net (1)

39

(3,702)

(3,735)

(4,314)

(3,680)

(101) %

(101) %

Total non-interest expense

21,550

23,812

24,961

26,605

29,329

(9) %

(27) %

Income before income taxes

(2,952)

8,071

37,695

18,887

7,735

(137) %

(138) %

Provision for income taxes

(739)

2,018

9,424

4,721

1,934

(137) %

(138) %

Net income

$       (2,213)

$         6,053

$       28,271

$       14,166

$        5,801

(137) %

(138) %

Effective Tax Rate

25 %

25 %

25 %

25 %

25 %



Efficiency Ratio

116 %

75 %

40 %

58 %

79 %



Total assets

$     371,260

$     414,104

$     484,047

$     485,878

$     472,371

(10) %

(21) %

Loans held for sale

$     148,275

$     228,889

$     309,946

$     353,105

$     352,466

(35) %

(58) %

Total deposits

$     228,890

$     207,129

$     220,509

$     224,117

$     397,459

11 %

(42) %

LHFS Production Statistics:












Closed loan volume for-sale

$     396,979

$     576,532

$     649,122

$     871,268

$     987,281

(31) %

(60) %

Gain on sale margin

2.65 %

2.62 %

2.59 %

2.71 %

3.07 %



Direct LHFS expense

$      10,465

$       13,197

$       14,296

$       18,150

$       19,958

(21) %

(48) %

Direct LHFS expenses as % of
volume

2.64 %

2.29 %

2.20 %

2.08 %

2.02 %



MSR Statistics:












Residential mortgage loans serviced
for others

$  12,997,911

$  12,932,747

$  12,810,574

$  12,755,671

$  12,853,291

1 %

1 %

MSR, net

$     196,177

$     179,558

$     165,807

$     123,615

$     105,834

9 %

85 %

MSR as % of serviced portfolio

1.51 %

1.39 %

1.29 %

0.97 %

0.82 %

0.12

0.69

Key Rates, end of period:












10 year CMT

3.83 %

2.98 %

2.32 %

1.52 %

1.52 %

0.85

2.31

FHLMC 30 year fixed

6.70 %

5.70 %

4.67 %

3.11 %

3.01 %

1.00

3.69

nm = not meaningful













(1) Represents the internal charges for centrally provided support services and other corporate overhead to the Mortgage Banking segment, partially offset by allocations from the Mortgage Banking segment to Core Banking for new portfolio loan originations and portfolio servicing costs.

Umpqua Holdings Corporation

Segments

(Unaudited)

(in thousands)

Core Banking

Mortgage Banking


Nine Months Ended

% Change

Nine Months Ended

% Change


Sep 30, 2022

Sep 30, 2021

Year over
Year

Sep 30, 2022

Sep 30, 2021

Year over
Year

Net interest income

$      760,628

$      676,837

12 %

$          3,909

$          9,431

(59) %

Provision (recapture) for credit
losses

51,068

(41,915)

(222) %

—

—

nm

Non-interest income











Residential mortgage banking
revenue:











Origination and sale

—

—

nm

42,460

134,165

(68) %

Servicing

—

—

nm

28,174

27,379

3 %

Change in fair value of MSR
asset:



nm






Changes due to
collection/realization of
expected cash flows over time

—

—

nm

(15,286)

(13,592)

12 %

Changes due to valuation inputs
or assumptions

—

—

nm

67,451

(4,326)

(1659) %

MSR hedge loss

—

—

nm

(14,128)

—

nm

Gain on sale of debt securities, net

2

4

(50) %

—

—

nm

Loss on equity securities, net

(7,383)

(1,045)

607 %

—

—

nm

Gain on swap derivatives, net

18,578

8,698

114 %

—

—

nm

Change in fair value of certain
loans held for investment

(62,656)

5,704

(1198) %

—

—

nm

Non-interest income (excluding
above items)

106,880

115,913

(8) %

557

680

(18) %

Total non-interest income

55,421

129,274

(57) %

109,228

144,306

(24) %

Non-interest expense











Merger related expenses

5,719

—

nm

—

—

nm

Exit and disposal costs

4,839

9,741

(50) %

—

—

nm

Non-interest expense (excluding
above items)

451,689

438,969

3 %

77,721

112,035

(31) %

Allocated expenses, net (1)

7,398

3,860

92 %

(7,398)

(3,860)

92 %

Total non-interest expense

469,645

452,570

4 %

70,323

108,175

(35) %

Income before income taxes

295,336

395,456

(25) %

42,814

45,562

(6) %

Provision for income taxes

73,659

97,681

(25) %

10,703

11,391

(6) %

Net income

$      221,677

$      297,775

(26) %

$        32,111

$        34,171

(6) %













Effective Tax Rate

25 %

25 %

—

25 %

25 %

—

Efficiency Ratio

57 %

56 %

1.00

62 %

70 %

(8.00)













LHFS Production Statistics:










Closed loan volume for-sale





$   1,622,633

$   3,875,836

(58) %

Gain on sale margin





2.62 %

3.46 %

(0.84)

Direct LHFS expense





$        37,958

$        76,568

(50) %

Direct LHFS expenses as % of
volume





2.34 %

1.98 %

0.36

nm = not meaningful











(1) Represents the internal charge of centrally provided support services and other corporate overhead to the Mortgage Banking segment, partially offset by allocations from the Mortgage Banking segment to Core Banking for new portfolio loan originations and portfolio servicing costs.
Non-GAAP Financial Measures

In addition to results presented in accordance with generally accepted accounting principles in the United States of America (GAAP), this press release contains certain non-GAAP financial measures. The company believes presenting certain non-GAAP financial measures provides investors with information useful in understanding our financial performance, our performance trends, and our financial position. We utilize these measures for internal planning and forecasting purposes. We, as well as securities analysts, investors, and other interested parties, also use these measures to compare peer company operating performance. We believe that our presentation and discussion, together with the accompanying reconciliations, provides a complete understanding of factors and trends affecting our business and allows investors to view performance in a manner similar to management. These non-GAAP measures should not be considered a substitution for GAAP basis measures and results, and we strongly encourage investors to review our consolidated financial statements in their entirety and not to rely on any single financial measure. Because non-GAAP financial measures are not standardized, it may not be possible to compare these financial measures with other companies' non-GAAP financial measures having the same or similar names.

Umpqua Holdings Corporation

GAAP to Non-GAAP Reconciliation

(Unaudited)



Quarter Ended

% Change

(Dollars in thousands, except per share
data)

Sep 30,
2022

Jun 30,
2022

Mar 31,
2022

Dec 31,
2021

Sep 30,
2021

Seq.
Quarter

Year
over
Year

Total shareholders' equity

a

$2,417,514

$2,518,276

$2,607,598

$2,749,270

$2,722,379

(4) %

(11) %

Less: Other intangible assets, net

5,764

6,789

7,815

8,840

9,970

(15) %

(42) %

Tangible common shareholders' equity

b

$2,411,750

$2,511,487

$2,599,783

$2,740,430

$2,712,409

(4) %

(11) %

Less: Accumulated other comprehensive
income (AOCI)

$ (449,560)

(308,147)

(183,756)

1,759

20,209

46 %

nm

Tangible common shareholders' equity,
ex AOCI

c

$2,861,310

$2,819,634

$2,783,539

$2,738,671

$2,692,200

1 %

6 %
















Total assets

d

$31,471,960

$30,135,694

$30,637,126

$30,640,936

$30,891,479

4 %

2 %

Less: Other intangible assets, net

5,764

6,789

7,815

8,840

9,970

(15) %

(42) %

Tangible assets

e

$31,466,196

$30,128,905

$30,629,311

$30,632,096

$30,881,509

4 %

2 %

Common shares outstanding at period
end

f

217,053

217,049

216,967

216,626

216,622

0 %

— %
















Total shareholders' equity to total assets ratio

a / d

7.68 %

8.36 %

8.51 %

8.97 %

8.81 %

(0.68)

(1.13)

Tangible common equity ratio

b / e

7.66 %

8.34 %

8.49 %

8.95 %

8.78 %

(0.68)

(1.12)

Tangible common equity ratio, ex AOCI

c / e

9.09 %

9.36 %

9.09 %

8.94 %

8.72 %

(0.27)

0.37

Book value per common share

a / f

$     11.14

$     11.60

$     12.02

$     12.69

$     12.57

(4) %

(11) %

Tangible book value per common share

b / f

$     11.11

$     11.57

$     11.98

$     12.65

$     12.52

(4) %

(11) %

Tangible book value per common share, ex
AOCI

c / f

$     13.18

$     12.99

$     12.83

$     12.64

$     12.43

1 %

6 %

nm = not meaningful














Umpqua Holdings Corporation

GAAP to Non-GAAP Reconciliation - Continued

(Unaudited)

Consolidated

Quarter Ended

% Change

(Dollars in thousands)

Sep 30,
2022

Jun 30,
2022

Mar 31,
2022

Dec 31,
2021

Sep 30,
2021

Seq.
Quarter

Year
over
Year

Non-Interest Income Adjustments














Gain on sale of debt securities, net

$            —

$            —

$              2

$              4

$            —

nm

nm

(Loss) gain on equity securities, net

(2,647)

(2,075)

(2,661)

(466)

(343)

28 %

672 %

Gain (loss) on swap derivatives

4,194

7,337

7,047

(303)

1,429

(43) %

193 %

Change in fair value of certain loans held
for investment

(26,397)

(15,210)

(21,049)

(2,672)

3,432

74 %

nm

Change in fair value of MSR due to
valuation inputs or assumptions

16,403

10,899

40,149

15,415

(634)

51 %

nm

MSR hedge loss

(14,128)

—

—

—

—

nm

nm

Total non-interest income adjustments

a

$    (22,575)

$          951

$     23,488

$     11,978

$       3,884

nm

nm
















Non-Interest Expense Adjustments














Merger related expenses

$          769

$       2,672

$       2,278

$     15,183

$            —

(71) %

nm

Exit and disposal costs

1,364

442

3,033

3,022

3,813

209 %

(64) %

Total non-interest expense adjustments

b

$       2,133

$       3,114

$       5,311

$     18,205

$       3,813

(32) %

(44) %
















Net interest income (1)

c

$   287,933

$   248,522

$   229,117

$   233,754

$   235,452

16 %

22 %
















Non-interest income (GAAP)

d

$     29,445

$     55,235

$     79,969

$     82,738

$     73,705

(47) %

(60) %

Less: Non-interest income adjustments

a

22,575

(951)

(23,488)

(11,978)

(3,884)

nm

nm

Operating non-interest income (non-
GAAP)

e

$     52,020

$     54,284

$     56,481

$     70,760

$     69,821

(4) %

(25) %
















Revenue (GAAP) (1)

f=c+d

$   317,378

$   303,757

$   309,086

$   316,492

$   309,157

4 %

3 %

Operating revenue (non-GAAP)  (1)

g=c+e

$   339,953

$   302,806

$   285,598

$   304,514

$   305,273

12 %

11 %
















Non-interest expense (GAAP)

h

$   177,964

$   179,574

$   182,430

$   199,711

$   183,753

(1) %

(3) %

Less: Non-interest expense adjustments

b

(2,133)

(3,114)

(5,311)

(18,205)

(3,813)

(32) %

(44) %

Operating non-interest expense (non-
GAAP)

i

$   175,831

$   176,460

$   177,119

$   181,506

$   179,940

— %

(2) %
















Net income (GAAP)

j

$     84,040

$     78,591

$     91,157

$     88,354

$   108,066

7 %

(22) %

Provision for income taxes

27,473

26,548

30,341

28,788

35,879

3 %

(23) %

Income before provision for income taxes

111,513

105,139

121,498

117,142

143,945

6 %

(23) %

Provision (recapture) for credit losses

27,572

18,692

4,804

(736)

(18,919)

48 %

(246) %

Pre-provision net revenue (PPNR) (non-
GAAP)

k

139,085

123,831

126,302

116,406

125,026

12 %

11 %

Less: Non-interest income adjustments

a

22,575

(951)

(23,488)

(11,978)

(3,884)

nm

nm

Add: Non-interest expense adjustments

b

2,133

3,114

5,311

18,205

3,813

(32) %

(44) %

Operating PPNR (non-GAAP)

l

$   163,793

$   125,994

$   108,125

$   122,633

$   124,955

30 %

31 %
















Net income (GAAP)

j

$     84,040

$     78,591

$     91,157

$     88,354

$   108,066

7 %

(22) %

Less: Non-interest income adjustments

a

22,575

(951)

(23,488)

(11,978)

(3,884)

nm

nm

Add: Non-interest expense adjustments

b

2,133

3,114

5,311

18,205

3,813

(32) %

(44) %

Tax effect of adjustments

(6,116)

(480)

4,576

1,190

18

nm

nm

Operating net income (non-GAAP)

m

$   102,632

$     80,274

$     77,556

$     95,771

$   108,013

28 %

(5) %

nm = not meaningful














(1) Tax exempt interest has been adjusted to a taxable equivalent basis using a 21% tax rate.

Umpqua Holdings Corporation

GAAP to Non-GAAP Reconciliation - Continued

(Unaudited)

Consolidated

Quarter Ended

% Change

(Dollars in thousands, except per share
data)

Sep 30,
2022

Jun 30,
2022

Mar 31,
2022

Dec 31,
2021

Sep 30,
2021

Seq.
Quarter

Year
over
Year

Average assets

n

$30,668,177

$30,356,903

$30,597,413

$30,886,378

$30,614,374

1 %

— %

Less: Average goodwill and other intangible
assets, net

6,343

7,379

8,407

9,491

10,609

(14) %

(40) %

Average tangible assets

o

$30,661,834

$30,349,524

$30,589,006

$30,876,887

$30,603,765

1 %

— %
















Average common shareholders' equity

p

$2,567,266

$2,584,836

$2,715,059

$2,717,753

$2,709,641

(1) %

(5) %

Less: Average goodwill and other intangible
assets, net

6,343

7,379

8,407

9,491

10,609

(14) %

(40) %

Average tangible common equity

q

$2,560,923

$2,577,457

$2,706,652

$2,708,262

$2,699,032

(1) %

(5) %
















Weighted average basic shares outstanding

r

217,051

217,030

216,782

216,624

218,416

0 %

(1) %

Weighted average diluted shares
outstanding

s

217,386

217,279

217,392

217,356

218,978

0 %

(1) %
















Select Per-Share & Performance Metrics














Earnings-per-share - basic

j / r

$      0.39

$      0.36

$      0.42

$      0.41

$      0.49

8 %

(20) %

Earnings-per-share - diluted

j / s

$      0.39

$      0.36

$      0.42

$      0.41

$      0.49

8 %

(20) %

Efficiency ratio

h / f

56.07 %

59.12 %

59.02 %

63.10 %

59.44 %

(3.05)

(3.37)

PPNR return on average assets

k / n

1.80 %

1.64 %

1.67 %

1.50 %

1.62 %

0.16

0.18

Return on average assets

j / n

1.09 %

1.04 %

1.21 %

1.13 %

1.40 %

0.05

(0.31)

Return on average tangible assets

j / o

1.09 %

1.04 %

1.21 %

1.14 %

1.40 %

0.05

(0.31)

Return on average common equity

j / p

12.99 %

12.20 %

13.62 %

12.90 %

15.82 %

0.79

(2.83)

Return on average tangible common equity

j / q

13.02 %

12.23 %

13.66 %

12.94 %

15.88 %

0.79

(2.86)
















Operating Per-Share & Performance Metrics














Operating earnings-per-share - basic

m / r

$      0.47

$      0.37

$      0.36

$      0.44

$      0.49

27 %

(4) %

Operating earnings-per-share - diluted

m / s

$      0.47

$      0.37

$      0.36

$      0.44

$      0.49

27 %

(4) %

Operating efficiency ratio

i / g

51.72 %

58.27 %

62.02 %

59.61 %

58.94 %

(6.55)

(7.22)

Operating PPNR return on average assets

l / n

2.12 %

1.66 %

1.43 %

1.58 %

1.62 %

0.46

0.50

Operating return on average assets

m / n

1.33 %

1.06 %

1.03 %

1.23 %

1.40 %

0.27

(0.07)

Operating return on average tangible assets

m / o

1.33 %

1.06 %

1.03 %

1.23 %

1.40 %

0.27

(0.07)

Operating return on average common equity

m / p

15.86 %

12.46 %

11.58 %

13.98 %

15.82 %

3.40

0.04

Operating return on average tangible common
equity

m / q

15.90 %

12.49 %

11.62 %

14.03 %

15.88 %

3.41

0.02

Umpqua Holdings Corporation

GAAP to Non-GAAP Reconciliation - Continued

(Unaudited)

Core Banking

Quarter Ended

% Change

(Dollars in thousands)

Sep 30,
2022

Jun 30,
2022

Mar 31,
2022

Dec 31,
2021

Sep 30,
2021

Seq.
Quarter

Year
over
Year

Non-Interest Income Adjustments














Gain on sale of debt securities, net

$       —

$       —

$         2

$           4

$         —

nm

nm

(Loss) gain on equity securities, net

(2,647)

(2,075)

(2,661)

(466)

(343)

28 %

672 %

Gain (loss) on swap derivatives

4,194

7,337

7,047

(303)

1,429

(43) %

193 %

Change in fair value of certain loans held for
investment

(26,397)

(15,210)

(21,049)

(2,672)

3,432

74 %

(869) %

Total non-interest income adjustments

a

$ (24,850)

$ (9,948)

$ (16,661)

$   (3,437)

$    4,518

150 %

(650) %
















Non-Interest Expense Adjustments














Merger related expenses

$     769

$  2,672

$  2,278

$  15,183

$         —

(71) %

nm

Exit and disposal costs

1,364

442

3,033

3,022

3,813

209 %

(64) %

Total non-interest expense adjustments

b

$  2,133

$  3,114

$  5,311

$  18,205

$    3,813

(32) %

(44) %
















Net interest income (1)

c

$  286,861

$  247,361

$  227,441

$ 231,625

$ 232,726

16 %

23 %
















Non-interest income (GAAP)

d

$ 11,919

$ 24,513

$ 18,989

$  39,375

$  39,367

(51) %

(70) %

Less: Non-interest income adjustments

a

24,850

9,948

16,661

3,437

(4,518)

150 %

(650) %

Operating non-interest income (non-GAAP)

e

$ 36,769

$ 34,461

$ 35,650

$  42,812

$  34,849

7 %

6 %
















Revenue (GAAP) (1)

f=c+d

$  298,780

$  271,874

$  246,430

$ 271,000

$ 272,093

10 %

10 %

Operating revenue (non-GAAP) (1)

g=c+e

$  323,630

$  281,822

$  263,091

$ 274,437

$ 267,575

15 %

21 %
















Non-interest expense (GAAP) (2)

h

$  156,414

$  155,762

$  157,469

$ 173,106

$ 154,424

— %

1 %

Less: Non-interest expense adjustments

b

(2,133)

(3,114)

(5,311)

(18,205)

(3,813)

(32) %

(44) %

Operating non-interest expense (non-GAAP)

i

$  154,281

$  152,648

$  152,158

$ 154,901

$ 150,611

1 %

2 %
















Net income (GAAP)

j

$ 86,253

$ 72,538

$ 62,886

$  74,188

$ 102,265

19 %

(16) %

Provision for income taxes

28,212

24,530

20,917

24,067

33,945

15 %

(17) %

Income before provision for income taxes

114,465

97,068

83,803

98,255

136,210

18 %

(16) %

Provision (recapture) for credit losses

27,572

18,692

4,804

(736)

(18,919)

48 %

(246) %

Pre-provision net revenue (PPNR) (non-GAAP)

k

142,037

115,760

88,607

97,519

117,291

23 %

21 %

Less: Non-interest income adjustments

a

24,850

9,948

16,661

3,437

(4,518)

150 %

(650) %

Add: Non-interest expense adjustments

b

2,133

3,114

5,311

18,205

3,813

(32) %

(44) %

Operating PPNR (non-GAAP)

l

$  169,020

$  128,822

$  110,579

$ 119,161

$ 116,586

31 %

45 %
















Net income (GAAP)

j

$ 86,253

$ 72,538

$ 62,886

$  74,188

$ 102,265

19 %

(16) %

Less: Non-interest income adjustments

a

24,850

9,948

16,661

3,437

(4,518)

150 %

(650) %

Add: Non-interest expense adjustments

b

2,133

3,114

5,311

18,205

3,813

(32) %

(44) %

Tax effect of adjustments

(6,685)

(3,205)

(5,461)

(2,664)

177

109 %

(3,877) %

Operating net income (non-GAAP)

m

$  106,551

$ 82,395

$ 79,397

$  93,166

$ 101,737

29 %

5 %
















Efficiency ratio

h / f

52.35 %

57.29 %

63.90 %

63.88 %

56.75 %

(4.94)

(4.40)

Operating efficiency ratio

i / g

47.67 %

54.16 %

57.83 %

56.44 %

56.29 %

(6.49)

(8.62)

Core Banking net income / Consolidated net
income

102.63 %

92.30 %

68.99 %

83.97 %

94.63 %

10.33

8.00

Core Banking operating net income /
Consolidated operating net income

103.82 %

102.64 %

102.37 %

97.28 %

94.19 %

1.18

9.63

nm = not meaningful














(1) Tax exempt interest has been adjusted to a taxable equivalent basis using a 21% tax rate.

(2) Includes adjustments related to allocated expenses between the Core Banking and Mortgage Banking segments.

Umpqua Holdings Corporation

GAAP to Non-GAAP Reconciliation - Continued

(Unaudited)

Mortgage Banking

Quarter Ended

% Change

(Dollars in thousands)

Sep 30,
2022

Jun 30,
2022

Mar 31,
2022

Dec 31,
2021

Sep 30,
2021

Seq.
Quarter

Year over
Year

Non-Interest Income Adjustments














Change in fair value of MSR due to valuation
inputs or assumptions

$ 16,403

$ 10,899

$ 40,149

$ 15,415

$    (634)

51 %

nm

   MSR hedge loss

(14,128)

—

—

—

—

nm

nm

Total non-interest income adjustments

a

$  2,275

$ 10,899

$ 40,149

$ 15,415

$    (634)

(79) %

(459) %
















Total non-interest expense adjustments

b

$       —

$       —

$       —

$       —

$       —

nm

nm
















Net interest income

c

$  1,072

$  1,161

$  1,676

$  2,129

$  2,726

(8) %

(61) %
















Non-interest income (GAAP)

d

$ 17,526

$ 30,722

$ 60,980

$ 43,363

$ 34,338

(43) %

(49) %

Less: Non-interest income adjustments

a

(2,275)

(10,899)

(40,149)

(15,415)

634

(79) %

(459) %

Operating non-interest income (non-GAAP)

e

$ 15,251

$ 19,823

$ 20,831

$ 27,948

$ 34,972

(23) %

(56) %
















Revenue (GAAP)

f=c+d

$ 18,598

$ 31,883

$ 62,656

$ 45,492

$ 37,064

(42) %

(50) %

Operating revenue (non-GAAP)

g=c+e

16,323

20,984

22,507

30,077

37,698

(22) %

(57) %
















Non-interest expense (GAAP) (1)

h

21,550

23,812

24,961

26,605

29,329

(9) %

(27) %

Less: Non-interest expense adjustments

b

—

—

—

—

—

nm

nm

Operating non-interest expense (non-GAAP)

i

$ 21,550

$ 23,812

$ 24,961

$ 26,605

$ 29,329

(9) %

(27) %
















Net income (GAAP)

j

$ (2,213)

$  6,053

$ 28,271

$ 14,166

$  5,801

(137) %

(138) %

Provision for income taxes

(739)

2,018

9,424

4,721

1,934

(137) %

(138) %

Income before provision for income taxes

(2,952)

8,071

37,695

18,887

7,735

(137) %

(138) %

Provision for credit losses

—

—

—

—

—

nm

nm

Pre-provision net revenue (PPNR) (non-
GAAP)

k

(2,952)

8,071

37,695

18,887

7,735

(137) %

(138) %

Less: Non-interest income adjustments

a

(2,275)

(10,899)

(40,149)

(15,415)

634

(79) %

(459) %

Add: Non-interest expense adjustments

b

—

—

—

—

—

nm

nm

Operating PPNR (non-GAAP)

l

$ (5,227)

$ (2,828)

$ (2,454)

$  3,472

$  8,369

85 %

(162) %
















Net income (GAAP)

j

$ (2,213)

$  6,053

$ 28,271

$ 14,166

$  5,801

(137) %

(138) %

Less: Non-interest income adjustments

a

(2,275)

(10,899)

(40,149)

(15,415)

634

(79) %

(459) %

Add: Non-interest expense adjustments

b

—

—

—

—

—

nm

nm

Tax effect of adjustments

569

2,725

10,037

3,854

(159)

(79) %

(458) %

Operating net income (non-GAAP)

m

$ (3,919)

$ (2,121)

$ (1,841)

$  2,605

$  6,276

85 %

(162) %
















Efficiency ratio

h / f

115.87 %

74.69 %

39.84 %

58.48 %

79.13 %

41.18

36.74

Operating efficiency ratio

i / g

132.02 %

113.48 %

110.90 %

88.46 %

77.80 %

18.54

54.22

Mortgage Banking net income / Consolidated
net income

(2.63) %

7.70 %

31.01 %

16.03 %

5.37 %

(10.33)

(8.00)

Mortgage Banking operating net income /
Consolidated operating net income

(3.82) %

(2.64) %

(2.37) %

2.72 %

5.81 %

(1.18)

(9.63)

nm = not meaningful














 (1) Includes adjustments related to allocated expenses between the Core Banking and Mortgage Banking segments.

Umpqua Holdings Corporation

GAAP to Non-GAAP Reconciliation - Continued

(Unaudited)

Consolidated

Year to Date

% Change

(Dollars in thousands)

Sep 30, 2022

Sep 30, 2021

Year over Year

Non-Interest Income Adjustments






Gain on sale of debt securities, net

$                        2

$                        4

(50) %

Loss on equity securities, net

(7,383)

(1,045)

nm

Gain on swap derivatives

18,578

8,698

114 %

Change in fair value of certain loans held for investment

(62,656)

5,704

nm

Change in fair value of MSR due to valuation inputs or assumptions

67,451

(4,326)

nm

   MSR hedge loss

(14,128)

—

nm

Total non-interest income adjustments

a

$                 1,864

$                 9,035

(79) %








Non-Interest Expense Adjustments






Merger related expenses

$                 5,719

$                      —

nm

Exit and disposal costs

4,839

9,741

(50) %

Total non-interest expense adjustments

b

$                10,558

$                 9,741

8 %








Net interest income (1)

c

$              765,572

$              687,404

11 %








Non-interest income (GAAP)

d

$              164,649

$              273,580

(40) %

Less: Non-interest income adjustments

a

(1,864)

(9,035)

(79) %

Operating non-interest income (non-GAAP)

e

$              162,785

$              264,545

(38) %








Revenue (GAAP) (1)

f=c+d

$              930,221

$              960,984

(3) %

Operating revenue (non-GAAP)  (1)

g=c+e

$              928,357

$              951,949

(2) %








Non-interest expense (GAAP)

h

$              539,968

$              560,745

(4) %

Less: Non-interest expense adjustments

b

(10,558)

(9,741)

8 %

Operating non-interest expense (non-GAAP)

i

$              529,410

$              551,004

(4) %








Net income (GAAP)

j

$              253,788

$              331,946

(24) %

Provision for income taxes

84,362

109,072

(23) %

Income before provision for income taxes

338,150

441,018

(23) %

Provision (recapture) for credit losses

51,068

(41,915)

(222) %

Pre-provision net revenue (PPNR) (non-GAAP)

k

389,218

399,103

(2) %

Less: Non-interest income adjustments

a

(1,864)

(9,035)

(79) %

Add: Non-interest expense adjustments

b

10,558

9,741

8 %

Operating PPNR (non-GAAP)

l

$              397,912

$              399,809

— %








Net income (GAAP)

j

$              253,788

$              331,946

(24) %

Less: Non-interest income adjustments

a

(1,864)

(9,035)

(79) %

Add: Non-interest expense adjustments

b

10,558

9,741

8 %

Tax effect of adjustments

(2,020)

(177)

nm

Operating net income (non-GAAP)

m

$              260,462

$              332,475

(22) %

nm = not meaningful





Average assets

n

$         30,541,027

$         30,058,769

2 %

Less: Average goodwill and other intangible assets, net

$                 7,369

$                12,922

(43) %

Average tangible assets

o

$         30,533,658

$         30,045,847

2 %








Average common shareholders' equity

p

$           2,621,725

$           2,694,968

(3) %

Less: Average goodwill and other intangible assets, net

$                 7,369

$                12,922

(43) %

Average tangible common equity

q

$           2,614,356

$           2,682,046

(3) %








Weighted average basic shares outstanding

r

216,955

219,791

(1) %

Weighted average diluted shares outstanding

s

217,353

220,278

(1) %








Select Per-Share & Performance Metrics






Earnings-per-share - basic

j / r

$                   1.17

$                   1.51

(23) %

Earnings-per-share - diluted

j / s

$                   1.17

$                   1.51

(23) %

Efficiency ratio

h / f

58.05 %

58.35 %

(0.30)

PPNR return on average assets

k / n

1.70 %

1.78 %

(0.08)

Return on average assets

j / n

1.11 %

1.48 %

(0.37)

Return on average tangible assets

j / o

1.11 %

1.48 %

(0.37)

Return on average common equity

j / p

12.94 %

16.47 %

(3.53)

Return on average tangible common equity

j / q

12.98 %

16.55 %

(3.57)








Operating Per-Share & Performance Metrics






Operating earnings-per-share - basic

m / r

$                   1.20

$                   1.51

(21) %

Operating earnings-per-share - diluted

m / s

$                   1.20

$                   1.51

(21) %

Operating efficiency ratio

i / g

57.03 %

57.88 %

(0.85)

Operating PPNR return on average assets

l / n

1.74 %

1.78 %

(0.04)

Operating return on average assets

m / n

1.14 %

1.48 %

(0.34)

Operating return on average tangible assets

m / o

1.14 %

1.48 %

(0.34)

Operating return on average common equity

m / p

13.28 %

16.49 %

(3.21)

Operating return on average tangible common equity

m / q

13.32 %

16.57 %

(3.25)

(1) Tax exempt interest has been adjusted to a taxable equivalent basis using a 21% tax rate.

Umpqua Holdings Corporation

GAAP to Non-GAAP Reconciliation - Continued

(Unaudited)








Core Banking

Year to Date

% Change

(Dollars in thousands)

Sep 30, 2022

Sep 30, 2021

Year over Year

Non-Interest Income Adjustments






Gain on sale of debt securities, net

$                        2

$                        4

(50) %

Loss on equity securities, net

(7,383)

(1,045)

607 %

Gain on swap derivatives

18,578

8,698

114 %

Change in fair value of certain loans held for investment

(62,656)

5,704

nm

Total non-interest income adjustments

a

$              (51,459)

$                13,361

(485) %








Non-Interest Expense Adjustments






Merger related expenses

$                 5,719

$                      —

nm

Exit and disposal costs

4,839

9,741

(50) %

Total non-interest expense adjustments

b

$                10,558

$                 9,741

8 %








Net interest income (1)

c

$              761,663

$              677,973

12 %








Non-interest income (GAAP)

d

$                55,421

$              129,274

(57) %

Less: Non-interest income adjustments

a

51,459

(13,361)

(485) %

Operating non-interest income (non-GAAP)

e

$              106,880

$              115,913

(8) %








Revenue (GAAP) (1)

f=c+d

$              817,084

$              807,247

1 %

Operating revenue (non-GAAP) (1)

g=c+e

$              868,543

$              793,886

9 %








Non-interest expense (GAAP) (2)

h

$              469,645

$              452,570

4 %

Less: Non-interest expense adjustments

b

(10,558)

(9,741)

8 %

Operating non-interest expense (non-GAAP)

i

$              459,087

$              442,829

4 %








Net income (GAAP)

j

$              221,677

$              297,775

(26) %

Provision for income taxes

73,659

97,681

(25) %

Income before provision for income taxes

295,336

395,456

(25) %

Provision (recapture) for credit losses

51,068

(41,915)

(222) %

Pre-provision net revenue (PPNR) (non-GAAP)

k

346,404

353,541

(2) %

Less: Non-interest income adjustments

a

51,459

(13,361)

(485) %

Add: Non-interest expense adjustments

b

10,558

9,741

8 %

Operating PPNR (non-GAAP)

l

$              408,421

$              349,921

17 %








Net income (GAAP)

j

$              221,677

$              297,775

(26) %

Less: Non-interest income adjustments

a

51,459

(13,361)

(485) %

Add: Non-interest expense adjustments

b

10,558

9,741

8 %

Tax effect of adjustments

(15,351)

905

nm

Operating net income (non-GAAP)

m

$              268,343

$              295,060

(9) %








Efficiency ratio

h / f

57.48 %

56.06 %

1.42

Operating efficiency ratio

i / g

52.86 %

55.78 %

(2.92)

Core Banking net income / Consolidated net income

87.35 %

89.71 %

(2.36)

Core Banking operating net income / Consolidated operating net income

103.03 %

88.75 %

14.28

nm = not meaningful





Umpqua Holdings Corporation

GAAP to Non-GAAP Reconciliation - Continued

(Unaudited)

Mortgage Banking

Year to Date

% Change

(Dollars in thousands)

Sep 30, 2022

Sep 30, 2021

Year over Year

Non-Interest Income Adjustments






Change in fair value of MSR due to valuation inputs or assumptions

$                67,451

$                (4,326)

nm

   MSR hedge loss

(14,128)

—

nm

Total non-interest income adjustments

a

$                53,323

$                (4,326)

nm








Total non-interest expense adjustments

b

$                      —

$                      —

nm








Net interest income

c

$                 3,909

$                 9,431

(59) %








Non-interest income (GAAP)

d

$              109,228

$              144,306

(24) %

Less: Non-interest income adjustments

a

(53,323)

4,326

nm

Operating non-interest income (non-GAAP)

e

$                55,905

$              148,632

(62) %








Revenue (GAAP)

f=c+d

$              113,137

$              153,737

(26) %

Operating revenue (non-GAAP)

g=c+e

$                59,814

$              158,063

(62) %








Non-interest expense (GAAP) (1)

h

$                70,323

$              108,175

(35) %

Less: Non-interest expense adjustments

b

—

—

nm

Operating non-interest expense (non-GAAP)

i

$                70,323

$              108,175

(35) %








Net income (GAAP)

j

$                32,111

$                34,171

(6) %

Provision for income taxes

10,703

11,391

(6) %

Income before provision for income taxes

42,814

45,562

(6) %

Provision for credit losses

—

—

nm

Pre-provision net revenue (PPNR) (non-GAAP)

k

42,814

45,562

(6) %

Less: Non-interest income adjustments

a

(53,323)

4,326

nm

Add: Non-interest expense adjustments

b

—

—

nm

Operating PPNR (non-GAAP)

l

$              (10,509)

$                49,888

(121) %








Net income (GAAP)

j

$                32,111

$                34,171

(6) %

Less: Non-interest income adjustments

a

(53,323)

4,326

nm

Add: Non-interest expense adjustments

b

—

—

nm

Tax effect of adjustments

13,331

(1,082)

nm

Operating net income (non-GAAP)

m

$                (7,881)

$                37,415

(121) %








Efficiency ratio

h / f

62.16 %

70.36 %

(8.20)

Operating efficiency ratio

i / g

117.57 %

68.44 %

49.13

Mortgage Banking net income / Consolidated net income

12.65 %

10.29 %

2.36

Mortgage Banking operating net income / Consolidated operating
net income

(3.03) %

11.25 %

(14.28)

nm = not meaningful





SOURCE Umpqua Holdings Corporation

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