Umpqua (UMPQ) Tops Q2 EPS by 8c

Umpqua (NASDAQ: UMPQ) reported Q2 EPS of $0.24, $0.08 better than the analyst estimate of $0.16.

Second Quarter 2020 Highlights (compared to prior quarter):

• Net interest income decreased by $6.0 million on a quarter to quarter basis primarily driven by lower average yields on loans and leases, partially offset by a lower cost of interest bearing deposits;
• Provision for credit losses decreased by $31.0 million, although still elevated from historical levels reflecting the continued influence of the COVID-19 global pandemic on economic forecasts;
• Net charge-offs decreased by twelve basis points to 0.29% of average loans and leases (annualized);
• Non-interest income increased by $74.8 million, driven primarily by an increase in net mortgage banking revenue;
• Non-interest expense decreased by $1.8 billion, driven by the $1.8 billion goodwill impairment that was recorded in the prior period. Absent the goodwill impairment charge, non-interest expense increased by $4.2 million from the prior quarter primarily due to strong mortgage production;
• Non-performing assets to total assets decreased six basis points to 0.26% from 0.32%;
• Estimated total risk-based capital ratio of 14.4% and estimated Tier 1 common to risk weighted assets ratio of 11.1%;
• Filed a Form 8-K on June 17, 2020, announcing the shift in timing of a dividend declaration date from historical intra-quarter announcements to after quarterly earnings are finalized and applicable regulatory approval processes are complete.

"Umpqua's second quarter results, particularly in light of the significant disruption due to the COVID-19 pandemic, are a testament to our associates' extraordinary resilience and commitment to serving our customers and communities. During the quarter, as we ramped up our efforts to support small businesses across our footprint, we rapidly processed and funded more than 15,000 PPP loans with an average loan size of $134,000. In addition, our home lending department had a record-breaking quarter, generating more than $2.1 billion in production," said Cort O'Haver, president and CEO of Umpqua Holdings Corporation. "We continue working with customers who qualify for payment deferrals as a result of COVID-19 impacts with a 5.7% deferral level that reflects the company's strong credit quality practices. I'm especially pleased with the reduction in our cost of interest bearing deposits and lower non-interest expenses, absent increased home lending commissions due to volume, as we operate in a low interest rate environment."

For earnings history and earnings-related data on Umpqua (UMPQ) click here.

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