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Form 8-K GLACIER BANCORP INC For: Oct 22

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October 22, 2015 5:28 PM EDT


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________________________________________________
FORM 8-K
____________________________________________________________

CURRENT REPORT

Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) October 22, 2015 

____________________________________________________________
Glacier Bancorp, Inc.
(Exact name of registrant as specified in its charter)

Montana
000-18911
81-0519541
(State or other jurisdiction
of incorporation)
(Commission File Number)
(IRS Employer Identification No.)

49 Commons Loop, Kalispell, Montana
59901
(Address of principal executive offices)
(Zip Code)

(406) 756-4200
Registrant's telephone number, including area code

Not Applicable
(Former name or former address, if changed since last report)

____________________________________________________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
[   ]
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
[   ]
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
[   ]
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
[   ]
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))





Item 2.02. Results of Operations and Financial Condition

On October 22, 2015, the Company issued a press release announcing its financial results for the quarter ended September 30, 2015. A copy of the press release is attached as Exhibit 99.1 and is incorporated herein in its entirety by reference.

The information in this Item 2.02 and the Exhibit attached hereto is furnished and shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such document or filing.

Item 9.01. Financial Statements and Exhibits

(a)    Financial statements of businesses acquired - not applicable.

(b)    Pro forma financial information - not applicable.

(d)
Exhibit 99.1 - Press Release dated October 22, 2015, announcing financial results for the quarter ended September 30, 2015.


SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
Glacier Bancorp, Inc.
 
 
(Registrant)
October 22, 2015
 
/s/   MICHAEL J. BLODNICK
(Date)
 
Michael J. Blodnick
President and Chief Executive Officer






NEWS RELEASE

FOR IMMEDIATE RELEASE
CONTACT: Michael J. Blodnick
(406) 751-4701
Ron J. Copher
(406) 751-7706

GLACIER BANCORP, INC. ANNOUNCES
RESULTS FOR THE QUARTER ENDED SEPTEMBER 30, 2015

HIGHLIGHTS:
•
Net income of $29.6 million for the current quarter, an increase of 1 percent from the prior quarter $29.3 million net income and an increase of 1 percent from the prior year third quarter net income of $29.3 million.
•
Current quarter diluted earnings per share of $0.39, compared to the prior quarter diluted earnings per share of $0.39 and the prior year third quarter diluted earnings per share of $0.40.
•
The loan portfolio increased $69 million, or 6 percent annualized, during the current quarter.
•
Non-interest bearing deposits of $1.894 billion, increased $162.7 million, or 9 percent, during the current quarter.
•
Dividend declared of $0.19 per share. The dividend was the 122nd consecutive quarterly dividend declared by the Company.
•
The Company announced the definitive agreement to acquire Cañon National Bank, a community bank based in Cañon City, Colorado, with total assets of $260 million at September 30, 2015.

Results Summary
 
Three Months ended
 
Nine Months ended
(Dollars in thousands, except per share data)
Sep 30,
2015
 
Jun 30,
2015
 
Mar 31,
2015
 
Sep 30,
2014
 
Sep 30,
2015
 
Sep 30,
2014
Net income
$
29,614

 
29,335

 
27,670

 
29,294

 
86,619

 
84,701

Diluted earnings per share
$
0.39

 
0.39

 
0.37

 
0.40

 
1.15

 
1.14

Return on average assets (annualized)
1.36
%
 
1.39
%
 
1.36
%
 
1.46
%
 
1.37
%
 
1.44
%
Return on average equity (annualized)
10.93
%
 
11.05
%
 
10.72
%
 
11.30
%
 
10.90
%
 
11.27
%

KALISPELL, MONTANA, October 22, 2015 - Glacier Bancorp, Inc. (Nasdaq: GBCI) reported net income of $29.6 million for the current quarter, an increase of $320 thousand, or 1 percent, from the $29.3 million of net income for the prior year third quarter. Diluted earnings per share for the current quarter was $0.39 per share, a decrease of $0.01, or 3 percent, from the prior year third quarter diluted earnings per share of $0.40. Included in the current quarter non-interest expense was $259 thousand of one-time acquisition and conversion related expenses.

1


“Once again this quarter we delivered solid performance metrics similar to what we have achieved over the past nine quarters,” said Mick Blodnick, President and Chief Executive Officer.  “Record top line revenues helped offset higher taxes in the third quarter and allowed us to generate another quarter of record earnings.  The growth in revenues came primarily from increases in interest on our investment and commercial loan portfolios as well as greater service charge fee income on deposit accounts,” Blodnick said.

Net income for the nine months ended September 30, 2015 was $86.6 million, an increase of $1.9 million, or 2 percent, from the $84.7 million of net income for the same period in the prior year. Diluted earnings per share for the nine months ended September 30, 2015 was $1.15 per share, an increase of $0.01, or 1 percent, from the diluted earnings per share for the same period in the prior year.
 
On February 28, 2015, the Company completed the acquisition of Montana Community Banks, Inc. and its subsidiary, Community Bank, Inc. (collectively, “CB”). The Company incurred $1.5 million of legal and professional expenses in connection with the CB acquisition and conversion during the current year. Goodwill of $1.1 million resulted from the acquisition which was based on the estimated fair value of the assets acquired and liabilities assumed. The Company’s results of operations and financial condition include the acquisition of CB from the acquisition date and the following table provides information on the fair value of selected classifications of assets and liabilities acquired:

(Dollars in thousands)
February 28,
2015
Total assets
$
175,774

Investment securities
42,350

Loans receivable
84,689

Non-interest bearing deposits
41,779

Interest bearing deposits
105,041

Federal Home Loan Bank advances and other borrowed funds
3,292



2


Asset Summary
 
 
 
 
 
 
 
 
 
$ Change from
(Dollars in thousands)
Sep 30,
2015
 
Jun 30,
2015
 
Dec 31,
2014
 
Sep 30,
2014
 
Jun 30,
2015
 
Dec 31,
2014
 
Sep 30,
2014
Cash and cash equivalents
$
242,835

 
355,719

 
442,409

 
282,097

 
(112,884
)
 
(199,574
)
 
(39,262
)
Investment securities, available-for-sale
2,530,994

 
2,361,830

 
2,387,428

 
2,398,196

 
169,164

 
143,566

 
132,798

Investment securities, held-to-maturity
651,822

 
593,314

 
520,997

 
482,757

 
58,508

 
130,825

 
169,065

Total investment securities
3,182,816

 
2,955,144

 
2,908,425

 
2,880,953

 
227,672

 
274,391

 
301,863

Loans receivable
 
 
 
 
 
 
 
 
 
 
 
 
 
Residential real estate
644,694

 
635,674

 
611,463

 
603,806

 
9,020

 
33,231

 
40,888

Commercial
3,581,667

 
3,529,274

 
3,263,448

 
3,248,529

 
52,393

 
318,219

 
333,138

Consumer and other
650,058

 
642,483

 
613,184

 
606,764

 
7,575

 
36,874

 
43,294

Loans receivable
4,876,419

 
4,807,431

 
4,488,095

 
4,459,099

 
68,988

 
388,324

 
417,320

Allowance for loan and lease losses
(130,768
)
 
(130,519
)
 
(129,753
)
 
(130,632
)
 
(249
)
 
(1,015
)
 
(136
)
Loans receivable, net
4,745,651

 
4,676,912

 
4,358,342

 
4,328,467

 
68,739

 
387,309

 
417,184

Other assets
592,997

 
602,035

 
597,331

 
618,293

 
(9,038
)
 
(4,334
)
 
(25,296
)
Total assets
$
8,764,299

 
8,589,810

 
8,306,507

 
8,109,810

 
174,489

 
457,792

 
654,489


Total investment securities of $3.183 billion at September 30, 2015 increased $228 million, or 8 percent, during the current quarter and increased $302 million, or 10 percent, from September 30, 2014. The increase in the investment portfolio from the prior quarter and the prior year third quarter was the result of continuing to selectively purchase investment securities with the Company’s excess liquidity resulting from the sustained increase in deposits. Investment securities represented 36 percent of total assets at September 30, 2015 compared to 35 percent at December 31, 2014 and 36 percent at September 30, 2014.

The Company continues to experience growth in the loan portfolio which increased $69.0 million, or 1 percent, during the current quarter. The loan category with the largest dollar increase during the current quarter was commercial real estate loans which increased $46.6 million, or 2 percent. The loan category with the largest percentage increase was residential construction (i.e., regulatory classification) which increased 10 percent over the prior quarter. Excluding the CB acquisition, the loan portfolio increased $304 million, or 7 percent, since December 31, 2014 with $252 million of the increase coming from growth in commercial loans. “Our loan growth was a little softer than what we had hoped for this quarter as a couple of large credits paid off,” Blodnick said.  “Loan production in the third quarter actually exceeded the first two quarters of the year, unfortunately so did pay offs.  The good news is the loan pipeline still looks decent as we head into what traditionally is a slower time of the year for loan production.  Hopefully, loan pay downs will slow down also,” Blodnick said.     


3


Credit Quality Summary
 
At or for the Nine Months ended
 
At or for the Six Months ended
 
At or for the Year ended
 
At or for the Nine Months ended
(Dollars in thousands)
Sep 30,
2015
 
Jun 30,
2015
 
Dec 31,
2014
 
Sep 30,
2014
Allowance for loan and lease losses
 
 
 
 
 
 
 
Balance at beginning of period
$
129,753

 
129,753

 
130,351

 
130,351

Provision for loan losses
1,873

 
1,047

 
1,912

 
1,721

Charge-offs
(4,671
)
 
(2,598
)
 
(7,603
)
 
(5,567
)
Recoveries
3,813

 
2,317

 
5,093

 
4,127

Balance at end of period
$
130,768

 
130,519

 
129,753

 
130,632

Other real estate owned
$
26,609

 
26,686

 
27,804

 
28,374

Accruing loans 90 days or more past due
3,784

 
618

 
214

 
1,617

Non-accrual loans
54,632

 
56,918

 
61,882

 
68,149

Total non-performing assets 1
$
85,025

 
84,222

 
89,900

 
98,140

Non-performing assets as a percentage of subsidiary assets
0.97
%
 
0.98
%
 
1.08
%
 
1.21
%
Allowance for loan and lease losses as a percentage of non-performing loans
224
%
 
227
%
 
209
%
 
187
%
Allowance for loan and lease losses as a percentage of total loans
2.68
%
 
2.71
%
 
2.89
%
 
2.93
%
Net charge-offs as a percentage of total loans
0.02
%
 
0.01
%
 
0.06
%
 
0.03
%
Accruing loans 30-89 days past due
$
17,822

 
28,474

 
25,904

 
17,570

Accruing troubled debt restructurings
$
63,638

 
64,336

 
69,129

 
74,376

Non-accrual troubled debt restructurings
$
27,442

 
32,664

 
33,714

 
37,482

__________ 
1 As of September 30, 2015, non-performing assets have not been reduced by U.S. government guarantees of $2.0 million.

Non-performing assets at September 30, 2015 were $85.0 million, an increase of $803 thousand, or less than 1 percent, during the current quarter. Non-performing assets at September 30, 2015 decreased $13.1 million, or 13 percent, from a year ago. Land, lot and other construction loans (i.e., regulatory classification) continues to be the largest category of non-performing assets with $38.6 million, or 45 percent, at September 30, 2015. The Company has continued to make progress by reducing this category the past few years and the category decreased $4.2 million, or 10 percent, from the prior quarter. Early stage delinquencies (accruing loans 30-89 days past due) of $17.8 million at September 30, 2015 decreased $10.7 million from the prior quarter and increased $252 thousand from the prior year third quarter.

The allowance for loan and lease losses (“allowance”) was $131 million at September 30, 2015 and continued to remain stable compared to the prior periods. The allowance was 2.68 percent of total loans outstanding at September 30, 2015 compared to 2.89 percent at December 31, 2014 and 2.93 percent for the same quarter last year. The reduction in the allowance as a percentage of total loans was driven primarily by loan growth, stabilizing credit quality, and no allowance carried over from bank acquisitions as a result of the acquired loans recorded at fair value.


4


Credit Quality Trends and Provision for Loan Losses
(Dollars in thousands)
Provision
for Loan
Losses
 
Net
Charge-Offs (Recoveries)
 
ALLL
as a Percent
of Loans
 
Accruing
Loans 30-89
Days Past Due
as a Percent of
Loans
 
Non-Performing
Assets to
Total Subsidiary
Assets
Third quarter 2015
$
826

 
$
577

 
2.68
%
 
0.37
%
 
0.97
%
Second quarter 2015
282

 
(381
)
 
2.71
%
 
0.59
%
 
0.98
%
First quarter 2015
765

 
662

 
2.77
%
 
0.71
%
 
1.07
%
Fourth quarter 2014
191

 
1,070

 
2.89
%
 
0.58
%
 
1.08
%
Third quarter 2014
360

 
364

 
2.93
%
 
0.39
%
 
1.21
%
Second quarter 2014
239

 
332

 
3.11
%
 
0.44
%
 
1.30
%
First quarter 2014
1,122

 
744

 
3.20
%
 
1.05
%
 
1.37
%
Fourth quarter 2013
1,802

 
2,216

 
3.21
%
 
0.79
%
 
1.39
%

Net charge-offs of loans for the current quarter were $577 thousand compared to net recoveries of $381 thousand for the prior quarter and net charge-offs of $364 thousand from the same quarter last year. The current quarter provision for loan losses of $826 thousand increased $544 thousand from the prior quarter and increased $466 thousand from the prior year third quarter. Loan portfolio growth, composition, average loan size, credit quality considerations, and other environmental factors will continue to determine the level of the loan loss provision. 

Supplemental information regarding credit quality and identification of the Company’s loan portfolio based on regulatory classification is provided in the exhibits at the end of this press release. The regulatory classification of loans is based primarily on collateral type while the Company’s loan segments presented herein are based on the purpose of the loan.

Liability Summary
 
 
 
 
 
 
 
 
 
$ Change from
(Dollars in thousands)
Sep 30,
2015
 
Jun 30,
2015
 
Dec 31,
2014
 
Sep 30,
2014
 
Jun 30,
2015
 
Dec 31,
2014
 
Sep 30,
2014
Non-interest bearing deposits
$
1,893,723

 
1,731,015

 
1,632,403

 
1,595,971

 
162,708

 
261,320

 
297,752

Interest bearing deposits
4,779,456

 
4,827,642

 
4,712,809

 
4,510,840

 
(48,186
)
 
66,647

 
268,616

Repurchase agreements
441,041

 
408,935

 
397,107

 
367,213

 
32,106

 
43,934

 
73,828

Federal Home Loan Bank advances
329,299

 
329,470

 
296,944

 
366,866

 
(171
)
 
32,355

 
(37,567
)
Other borrowed funds
6,619

 
6,665

 
7,311

 
7,351

 
(46
)
 
(692
)
 
(732
)
Subordinated debentures
125,812

 
125,776

 
125,705

 
125,669

 
36

 
107

 
143

Other liabilities
113,541

 
103,856

 
106,181

 
95,420

 
9,685

 
7,360

 
18,121

Total liabilities
$
7,689,491

 
7,533,359

 
7,278,460

 
7,069,330

 
156,132

 
411,031

 
620,161


The Company continues to generate strong increases in non-interest bearing deposits. Non-interest bearing deposits of $1.894 billion at September 30, 2015, increased $163 million, or 9 percent, from the prior quarter. Excluding the CB acquisition, non-interest bearing deposits increased $256 million, or 16 percent, from September 30, 2014. Interest bearing deposits of $4.779 billion at September 30, 2015 included $190 million of wholesale deposits (i.e., brokered deposits classified as NOW, money market deposits and certificate accounts). Excluding the decrease of $7.5 million in wholesale deposits, interest bearing deposits at September 30, 2015 decreased $40.6 million, or 1 percent, during the current quarter. Excluding the CB acquisition, interest bearing deposits at September 30, 2015 increased $164 million, or 4 percent, from September 30, 2014. “We continue to drive significant organic

5


growth in non-interest bearing deposits, ” Blodnick said.  “The current quarter was by far the largest increase we have generated in this deposit category and even exceeds those quarters where we acquired a new bank.  It’s a testament to the great work done by all of our banks in adding to and maintaining  their market share.  This large low cost deposit base will serve us well when interest rates begin to rise,” Blodnick said.

Securities sold under agreements to repurchase (“repurchase agreements”) of $441 million at September 30, 2015 increased $32.1 million, or 8 percent, from the prior quarter and was primarily the result of additions to existing repurchase agreements. Federal Home Loan Bank (“FHLB”) advances of $329 million at September 30, 2015 were unchanged for the current quarter and increased $32.4 million, or 11 percent, since December 31, 2014 as the Company took advantage of attractive term borrowings that were available from the FHLB of Seattle prior to the merger with FHLB of Des Moines during the second quarter of 2015. FHLB advances decreased $37.6 million, or 10 percent, from September 30, 2014 as growth in deposits and continued balance sheet changes reduced the need for additional borrowings.

Stockholders’ Equity Summary
 
 
 
 
 
 
 
 
 
$ Change from
(Dollars in thousands, except per share data)
Sep 30,
2015
 
Jun 30,
2015
 
Dec 31,
2014
 
Sep 30,
2014
 
Jun 30,
2015
 
Dec 31,
2014
 
Sep 30,
2014
Common equity
$
1,066,801

 
1,051,011

 
1,010,303

 
1,017,805

 
15,790

 
56,498

 
48,996

Accumulated other comprehensive income
8,007

 
5,440

 
17,744

 
22,675

 
2,567

 
(9,737
)
 
(14,668
)
Total stockholders’ equity
1,074,808

 
1,056,451

 
1,028,047

 
1,040,480

 
18,357

 
46,761

 
34,328

Goodwill and core deposit intangible, net
(141,624
)
 
(142,344
)
 
(140,606
)
 
(141,323
)
 
720

 
(1,018
)
 
(301
)
Tangible stockholders’ equity
$
933,184

 
914,107

 
887,441

 
899,157

 
19,077

 
45,743

 
34,027

Stockholders’ equity to total assets
12.26
%
 
12.30
%
 
12.38
%
 
12.83
%
 
 
 
 
 
 
Tangible stockholders’ equity to total tangible assets
10.82
%
 
10.82
%
 
10.87
%
 
11.28
%
 
 
 
 
 
 
Book value per common share
$
14.23

 
13.99

 
13.70

 
13.87

 
0.24

 
0.53

 
0.36

Tangible book value per common share
$
12.35

 
12.10

 
11.83

 
11.98

 
0.25

 
0.52

 
0.37

Market price per share at end of period
$
26.39

 
29.42

 
27.77

 
25.86

 
(3.03
)
 
(1.38
)
 
0.53


Tangible stockholders’ equity of $933 million at September 30, 2015 increased $19.1 million, or 2 percent, from the prior quarter due primarily to earnings retention and an increase in accumulated other comprehensive income. Tangible stockholders’ equity increased $34.0 million, or 4 percent, from a year ago the result of earnings retention and Company stock issued in connection with the CB acquisitions, both of which offset the decrease in accumulated other comprehensive income. Tangible book value per common share of $12.35 increased $0.25 per share from the prior quarter and increased $0.37 per share from the prior year third quarter.

Cash Dividend
On September 30, 2015, the Company’s Board of Directors declared a cash dividend of $0.19 per share. The dividend was payable October 22, 2015 to shareholders of record on October 13, 2015. Future cash dividends will depend on a variety of factors, including net income, capital, asset quality, general economic conditions and regulatory considerations.


6


Operating Results for Three Months Ended September 30, 2015 
Compared to June 30, 2015 and September 30, 2014

Income Summary
 
Three Months ended
 
$ Change from
(Dollars in thousands)
Sep 30,
2015
 
Jun 30,
2015
 
Mar 31,
2015
 
Sep 30,
2014
 
Jun 30,
2015
 
Mar 31,
2015
 
Sep 30,
2014
Net interest income
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest income
$
80,367

 
78,617

 
77,486

 
75,690

 
1,750

 
2,881

 
4,677

Interest expense
7,309

 
7,369

 
7,382

 
6,430

 
(60
)
 
(73
)
 
879

Total net interest income
73,058

 
71,248

 
70,104

 
69,260

 
1,810

 
2,954

 
3,798

Non-interest income
 
 
 
 
 
 
 
 
 
 
 
 
 
Service charges, loan fees, and other fees
16,030

 
15,445

 
14,156

 
15,661

 
585

 
1,874

 
369

Gain on sale of loans
7,326

 
7,600

 
5,430

 
6,000

 
(274
)
 
1,896

 
1,326

(Loss) gain on sale of investments
(31
)
 
(98
)
 
5

 
(61
)
 
67

 
(36
)
 
30

Other income
2,474

 
2,855

 
3,102

 
2,832

 
(381
)
 
(628
)
 
(358
)
Total non-interest income
25,799

 
25,802

 
22,693

 
24,432

 
(3
)
 
3,106

 
1,367

 
$
98,857

 
97,050

 
92,797

 
93,692

 
1,807

 
6,060

 
5,165

Net interest margin (tax-equivalent)
3.96
%
 
3.98
%
 
4.03
%
 
3.99
%
 
 
 
 
 
 

Net Interest Income
In the current quarter, interest income of $80.4 million increased $1.8 million, or 2 percent from the prior quarter, such increase attributable to increases in interest income on commercial loans. Income of $42.1 million on commercial loans increased $1.4 million, or 4 percent, from the prior quarter and was driven primarily by loan volume increases. Interest income during the current quarter increased $4.7 million, or 6 percent, over the prior year third quarter and was also due to higher interest income on commercial loans. The current quarter interest income on commercial loans increased $14.2 million, or 13 percent, over the prior year third quarter primarily the result of an increased volume in commercial loans. Interest income of $22.4 million on investment securities increased $478 thousand, or 2 percent, over the prior quarter and decreased $357 thousand, or 2 percent, over the prior year third quarter.

The current quarter interest expense of $7.3 million decreased $60 thousand, or 1 percent, from the prior quarter. The current quarter interest expense increased $879 thousand from the prior year third quarter, such increase attributed to the interest expense associated with the interest rate swap which started interest expense accruals in the fourth quarter of 2014. The total cost of funding (including non-interest bearing deposits) for the current quarter was 39 basis points compared to 40 basis points for the prior quarter and 37 basis points in the prior year third quarter.

The Company’s net interest margin as a percentage of earning assets, on a tax-equivalent basis, for the current quarter was 3.96 percent compared to 3.98 percent in the prior quarter. The 2 basis point decrease in the current quarter net interest margin was primarily driven by a 3 basis point reduction in the acquired loan fair value discount accretion. Included in the current quarter net interest margin was 4 basis points related to the recovery of interest on loans previously placed on non-accrual compared to 1 basis point in the prior quarter. The Company’s current quarter net interest margin decreased 3 basis points from the prior year third quarter net interest margin of 3.99 percent. The reduction in the net interest margin from the prior year third quarter was the result of a 6 basis point increase in interest expense related to the interest rate swaps. “The net interest margin for the current and sequential

7


quarter and for the first nine months of the current year have remained stable compared to the year ago quarters and year ago nine month period as the Bank divisions have been disciplined in pricing loans and interest bearing deposits,” said Ron Copher, Chief Financial Officer. “The growth in the non-interest bearing balances has served the Bank well to offset the higher interest expense associated with the interest rate swap.”

Non-interest Income
Non-interest income for the current quarter totaled $25.8 million which was stable compared to the prior quarter and an increase of $1.4 million, or 6 percent, over the same quarter last year. Service fee income of $16.0 million, increased $585 thousand, or 4 percent, from the prior quarter and increased $369 thousand, or 2 percent, from the prior year third quarter with both increases the result of the increased number of deposit accounts. Gain of $7.3 million on the sale of the residential loans in the current quarter decreased $274 thousand, or 4 percent, from the prior quarter and increased $1.3 million, or 22 percent, from the prior year third quarter as a result of an increase in mortgage purchase activity. Other non-interest income for the current quarter decreased $381 thousand, or 13 percent, over the prior quarter the result of annual incentives received in the second quarter of 2015. Other non-interest income decreased $358 thousand, or 13 percent, over the prior year third quarter due to a decrease in other real estate owned (“OREO”) income. Included in other income was operating revenue of $19 thousand from OREO and a gain of $110 thousand from the sale of OREO, a combined total of $129 thousand for the current quarter compared to $323 thousand for the prior quarter and $406 thousand for the prior year third quarter.

Non-interest Expense Summary
 
Three Months ended
 
$ Change from
(Dollars in thousands)
Sep 30,
2015
 
Jun 30,
2015
 
Mar 31,
2015
 
Sep 30,
2014
 
Jun 30,
2015
 
Mar 31,
2015
 
Sep 30,
2014
Compensation and employee benefits
$
33,534

 
32,729

 
32,244

 
30,142

 
805

 
1,290

 
3,392

Occupancy and equipment
7,887

 
7,810

 
7,362

 
6,961

 
77

 
525

 
926

Advertising and promotions
2,459

 
2,240

 
1,927

 
2,141

 
219

 
532

 
318

Data processing
1,258

 
1,593

 
1,249

 
1,472

 
(335
)
 
9

 
(214
)
Other real estate owned
1,047

 
1,377

 
758

 
602

 
(330
)
 
289

 
445

Regulatory assessments and insurance
1,478

 
1,006

 
1,305

 
1,435

 
472

 
173

 
43

Core deposit intangibles amortization
720

 
755

 
731

 
692

 
(35
)
 
(11
)
 
28

Other expenses
10,729

 
12,435

 
9,921

 
10,793

 
(1,706
)
 
808

 
(64
)
Total non-interest expense
$
59,112

 
59,945

 
55,497

 
54,238

 
(833
)
 
3,615

 
4,874


Compensation and employee benefits for the current quarter increased by $805 thousand, or 2 percent, from the prior quarter. Compensation and employee benefits for the current quarter increased by $3.4 million, or 11 percent, from the prior year third quarter due to the increased number of employees from the CB acquisition and the First National Bank of the Rockies (“FNBR”) acquisition in August 2014, and annual salary increases. Current quarter occupancy and equipment expense increased $926 thousand, or 13 percent, from the prior year third quarter as a result of added costs associated with the CB and FNBR acquisitions and equipment expense related to additional information technology infrastructure. The current quarter advertising expense increased $219 thousand, or 10 percent, from the prior quarter and increased $318 thousand, or 15 percent, from the prior year third quarter as a result of the Company actively marketing to its customer base in certain market areas. The current quarter data processing expense decreased $335 thousand, or 21 percent, from the prior quarter as a result of conversion related expenses and general increases during the prior quarter. The current quarter data processing expense decreased $214 thousand, or 15 percent, from the prior year third quarter as a result of a decrease in outsourced data processing expense from an acquired bank in the prior year third quarter. The current quarter OREO expense of $1.0 million was a decrease of $330 thousand from the prior quarter and included $559 thousand of operating expense, $452 thousand of fair value write-downs, and $37 thousand of loss from the sales of OREO. Current quarter other

8


expenses of $10.7 million decreased by $1.7 million, or 14 percent, from the prior quarter primarily from expenses connected with equity investments in New Market Tax Credits (“NMTC”) projects and conversion related expenses which were incurred in the second quarter of 2015. The NMTC expenses were more than offset by the tax benefits included in federal income tax expense during the second quarter of 2015 which was the reason for the increase of $1.8 million in federal and state income tax during the current quarter.

Efficiency Ratio
The efficiency ratio for the current quarter was 54.32 percent compared to 55.91 percent in the prior quarter. The 1.59 percent decrease in efficiency ratio resulted from decreases in expenses associated with NMTC projects and increases in net interest income primarily from volume increases in commercial loans and investment securities. The current quarter efficiency ratio of 54.32 percent compares to 53.87 percent in the prior year third quarter. The 45 basis point increase in efficiency ratio resulted from increases in non-interest expense driven by increased compensation and other operational expenses, which outpaced the increases in net interest income from an increase in earning assets.

Operating Results for Nine Months ended September 30, 2015
Compared to September 30, 2014

Income Summary
 
Nine Months ended
 
$ Change
 
% Change
(Dollars in thousands)
Sep 30,
2015
 
Sep 30,
2014
 
Net interest income
 
 
 
 
 
 
 
Interest income
$
236,470

 
$
223,740

 
$
12,730

 
6
 %
Interest expense
22,060

 
19,598

 
2,462

 
13
 %
Total net interest income
214,410

 
204,142

 
10,268

 
5
 %
Non-interest income
 
 
 
 
 
 
 
Service charges, loan fees, and other fees
45,631

 
43,656

 
1,975

 
5
 %
Gain on sale of loans
20,356

 
14,373

 
5,983

 
42
 %
Loss on sale of investments
(124
)
 
(160
)
 
36

 
(23
)%
Other income
8,431

 
8,455

 
(24
)
 
—
 %
Total non-interest income
74,294

 
66,324

 
7,970

 
12
 %
 
$
288,704

 
$
270,466

 
$
18,238

 
7
 %
Net interest margin (tax-equivalent)
3.99
%
 
4.00
%
 
 
 
 


9


Net Interest Income
Interest income for the first nine months of the current year increased $12.7 million, or 6 percent, from the prior year first nine months and was principally due to an increase in income from commercial loans. Current year interest income of $122 million on commercial loans increased $14.2 million, or 13 percent, from the prior year first nine months and was primarily the result of an increased volume of commercial loans. Current year interest income of $67.4 million on investment securities decreased $3.6 million, or 5 percent, over the same period last year, as a result of a decreased rate on investment securities, although the tax effective yield adjustment reduced this decrease to $140 thousand.

Interest expense for the first nine months of the current year increased $2.5 million, or 13 percent, from the prior year first nine months and was primarily due to the interest expense associated with the interest rate swap which started interest expense accruals in the fourth quarter of 2014. The total funding cost (including non-interest bearing deposits) for the first nine months of 2015 was 40 basis points compared to 39 basis points for the first nine months of 2014. 

The net interest margin as a percentage of earning assets, on a tax-equivalent basis, for the first nine months of 2015 was 3.99 percent, a decrease of 1 basis point from the prior year first nine months net interest margin of 4.00 percent. The 1 basis point reduction was attributable to a combination of items including an increase in interest expense from the interest rate swaps which was partially offset by increases in higher yielding earning assets.

Non-interest Income
Non-interest income of $74.3 million for the first nine months of 2015 increased $8.0 million, or 12 percent, over the same period last year. Service charges and other fees of $45.6 million for the first nine months of 2015 increased $2.0 million, or 5 percent, from the same period last year driven by the increased number of deposit accounts. The gains of $20.4 million on the sale of residential loans for the first nine months of 2015 increased $6.0 million, or 42 percent, from the first nine months of 2014 resulting from an increase in mortgage refinancing and purchase activity. Other income was unchanged from the nine month period last year. Included in other income was operating revenue of $95 thousand from OREO and gains of $775 thousand from the sales of OREO, which totaled $870 thousand for the first nine months of 2015 compared to $1.8 million for the same period in the prior year.

Non-interest Expense Summary
 
Nine Months ended
 
$ Change
 
% Change
(Dollars in thousands)
Sep 30,
2015
 
Sep 30,
2014
 
Compensation and employee benefits
$
98,507

 
$
87,764

 
$
10,743

 
12
 %
Occupancy and equipment
23,059

 
20,307

 
2,752

 
14
 %
Advertising and promotions
6,626

 
5,866

 
760

 
13
 %
Data processing
4,100

 
4,792

 
(692
)
 
(14
)%
Other real estate owned
3,182

 
1,675

 
1,507

 
90
 %
Regulatory assessments and insurance
3,789

 
4,055

 
(266
)
 
(7
)%
Core deposit intangible amortization
2,206

 
2,095

 
111

 
5
 %
Other expenses
33,085

 
30,427

 
2,658

 
9
 %
Total non-interest expense
$
174,554

 
$
156,981

 
$
17,573

 
11
 %

Compensation and employee benefits for the first nine months of 2015 increased $10.7 million, or 12 percent, from the same period last year due to the increased number of employees from the acquired banks, additional benefit costs and annual salary increases. Occupancy and equipment expense increased $2.8 million, or 14 percent, as a result of increased costs associated with the CB and FNBR acquisitions and equipment expense related to

10


additional information technology infrastructure. Outsourced data processing expense decreased $692 thousand, or 14 percent, from the prior year first nine months as a result of a decrease in conversion related expenses and outsourced data processing expense from an acquired bank. OREO expense of $3.2 million in the first nine months of 2015 increased $1.5 million, or 90 percent, from the first nine months of the prior year. OREO expenses tend to fluctuate based on the level of activity in various quarters. OREO expense for the first nine months of 2015 included $1.4 million of operating expenses, $1.5 million of fair value write-downs, and $250 thousand of loss from the sales of OREO. Other expense of $33.1 million for the first nine months of 2015 increased by $2.7 million, or 9 percent, from the first nine months of the prior year primarily due to increases in conversion and acquisition related expenses.

Provision for Loan Losses
The provision for loan losses was $1.9 million for the first nine months of 2015, an increase of $152 thousand, or 9 percent, from the same period in the prior year. Net charged-off loans during the first nine months of 2015 were $858 thousand, a decrease of $582 thousand from the first nine months of 2014.

Efficiency Ratio
The efficiency ratio was 55.01 percent for the first nine months of 2015 and 54.03 percent for the first nine months of 2014. The increase in the efficiency ratio resulted from compensation expense and increased costs from acquisitions outpacing the increase in net interest income and increases in gain on sale of loans.

About Glacier Bancorp, Inc.
Glacier Bancorp, Inc. is a regional bank holding company providing commercial banking services in 82 communities in Montana, Idaho, Utah, Washington, Wyoming and Colorado. Glacier Bancorp, Inc. is headquartered in Kalispell, Montana, and  is the parent company for Glacier Bank, Kalispell and Bank divisions First Security Bank of Missoula; Valley Bank of Helena; Big Sky Western Bank, Bozeman; Western Security Bank, Billings; and First Bank of Montana, Lewistown, all operating in Montana; as well as Mountain West Bank, Coeur d’Alene operating in Idaho, Utah and Washington; Citizens Community Bank, Pocatello, operating in Idaho; 1st Bank, Evanston, operating in Wyoming and Utah;  First Bank of Wyoming, Powell and First State Bank, Wheatland, each operating in Wyoming; North Cascades Bank, Chelan, operating in Washington; and Bank of the San Juans, Durango, operating in Colorado.

Forward-Looking Statements
This news release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, statements about management’s plans, objectives, expectations and intentions that are not historical facts, and other statements identified by words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “should,” “projects,” “seeks,” “estimates” or words of similar meaning. These forward-looking statements are based on current beliefs and expectations of management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the Company’s control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations in the forward-looking statements, including those set forth in this news release:
•
the risks associated with lending and potential adverse changes of the credit quality of loans in the Company’s portfolio;
•
changes in market interest rates, which could adversely affect the Company’s net interest income and profitability;
•
legislative or regulatory changes that adversely affect the Company’s business, ability to complete pending or prospective future acquisitions, limit certain sources of revenue, or increase cost of operations;

11


•
costs or difficulties related to the completion and integration of acquisitions;
•
the goodwill the Company has recorded in connection with acquisitions could become impaired, which may have an adverse impact on earnings and capital;
•
reduced demand for banking products and services;
•
the risks presented by public stock market volatility, which could adversely affect the market price of the Company’s common stock and the ability to raise additional capital or grow the Company through acquisitions;
•
consolidation in the financial services industry in the Company’s markets resulting in the creation of larger financial institutions who may have greater resources could change the competitive landscape;
•
dependence on the Chief Executive Officer, the senior management team and the Presidents of the Bank divisions;
•
potential interruption or breach in security of the Company’s systems; and
•
the Company’s success in managing risks involved in the foregoing.

The Company does not undertake any obligation to publicly correct or update any forward-looking statement if it later becomes aware that actual results are likely to differ materially from those expressed in such forward-looking statement.

12


Glacier Bancorp, Inc.
Unaudited Condensed Consolidated Statements of Financial Condition

(Dollars in thousands, except per share data)
September 30,
2015
 
June 30,
2015
 
December 31,
2014
 
September 30,
2014
Assets
 
 
 
 
 
 
 
Cash on hand and in banks
$
104,363

 
120,783

 
122,834

 
109,947

Federal funds sold
2,210

 
—

 
1,025

 
488

Interest bearing cash deposits
136,262

 
234,936

 
318,550

 
171,662

Cash and cash equivalents
242,835

 
355,719

 
442,409

 
282,097

Investment securities, available-for-sale
2,530,994

 
2,361,830

 
2,387,428

 
2,398,196

Investment securities, held-to-maturity
651,822

 
593,314

 
520,997

 
482,757

Total investment securities
3,182,816

 
2,955,144

 
2,908,425

 
2,880,953

Loans held for sale
40,456

 
53,201

 
46,726

 
65,598

Loans receivable
4,876,419

 
4,807,431

 
4,488,095

 
4,459,099

Allowance for loan and lease losses
(130,768
)
 
(130,519
)
 
(129,753
)
 
(130,632
)
Loans receivable, net
4,745,651

 
4,676,912

 
4,358,342

 
4,328,467

Premises and equipment, net
185,864

 
186,858

 
179,175

 
178,509

Other real estate owned
26,609

 
26,686

 
27,804

 
28,374

Accrued interest receivable
46,786

 
44,563

 
40,587

 
42,981

Deferred tax asset
55,095

 
56,571

 
41,737

 
44,452

Core deposit intangible, net
10,781

 
11,501

 
10,900

 
11,617

Goodwill
130,843

 
130,843

 
129,706

 
129,706

Non-marketable equity securities
24,905

 
24,914

 
52,868

 
52,868

Other assets
71,658

 
66,898

 
67,828

 
64,188

Total assets
$
8,764,299

 
8,589,810

 
8,306,507

 
8,109,810

Liabilities
 
 
 
 
 
 
 
Non-interest bearing deposits
$
1,893,723

 
1,731,015

 
1,632,403

 
1,595,971

Interest bearing deposits
4,779,456

 
4,827,642

 
4,712,809

 
4,510,840

Securities sold under agreements to repurchase
441,041

 
408,935

 
397,107

 
367,213

FHLB advances
329,299

 
329,470

 
296,944

 
366,866

Other borrowed funds
6,619

 
6,665

 
7,311

 
7,351

Subordinated debentures
125,812

 
125,776

 
125,705

 
125,669

Accrued interest payable
3,641

 
3,790

 
4,155

 
3,058

Other liabilities
109,900

 
100,066

 
102,026

 
92,362

Total liabilities
7,689,491

 
7,533,359

 
7,278,460

 
7,069,330

Stockholders’ Equity
 
 
 
 
 
 
 
Preferred shares, $0.01 par value per share, 1,000,000 shares authorized, none issued or outstanding
—

 
—

 
—

 
—

Common stock, $0.01 par value per share, 117,187,500 shares authorized
755

 
755

 
750

 
750

Paid-in capital
720,639

 
720,073

 
708,356

 
707,821

Retained earnings - substantially restricted
345,407

 
330,183

 
301,197

 
309,234

Accumulated other comprehensive income
8,007

 
5,440

 
17,744

 
22,675

Total stockholders’ equity
1,074,808

 
1,056,451

 
1,028,047

 
1,040,480

Total liabilities and stockholders’ equity
$
8,764,299

 
8,589,810

 
8,306,507

 
8,109,810

Number of common stock shares issued and outstanding
75,532,082

 
75,531,258

 
75,026,092

 
75,024,092



13


Glacier Bancorp, Inc.
Unaudited Condensed Consolidated Statements of Operations

 
Three Months ended
 
Nine Months ended
(Dollars in thousands, except per share data)
September 30,
2015
 
June 30,
2015
 
September 30,
2014
 
September 30,
2015
 
September 30,
2014
Interest Income
 
 
 
 
 
 
 
 
 
Investment securities
$
22,437

 
21,959

 
22,794

 
67,355

 
71,002

Residential real estate loans
7,878

 
7,942

 
7,950

 
23,581

 
22,257

Commercial loans
42,137

 
40,698

 
37,387

 
121,857

 
107,696

Consumer and other loans
7,915

 
8,018

 
7,559

 
23,677

 
22,785

Total interest income
80,367

 
78,617

 
75,690

 
236,470

 
223,740

Interest Expense
 
 
 
 
 
 
 
 
 
Deposits
3,947

 
4,112

 
3,027

 
12,206

 
9,177

Securities sold under agreements to repurchase
261

 
232

 
225

 
734

 
627

Federal Home Loan Bank advances
2,273

 
2,217

 
2,356

 
6,685

 
7,317

Federal funds purchased and other borrowed funds
21

 
15

 
34

 
63

 
135

Subordinated debentures
807

 
793

 
788

 
2,372

 
2,342

Total interest expense
7,309

 
7,369

 
6,430

 
22,060

 
19,598

Net Interest Income
73,058

 
71,248

 
69,260

 
214,410

 
204,142

Provision for loan losses
826

 
282

 
360

 
1,873

 
1,721

Net interest income after provision for loan losses
72,232

 
70,966

 
68,900

 
212,537

 
202,421

Non-Interest Income
 
 
 
 
 
 
 
 
 
Service charges and other fees
14,975

 
14,303

 
14,319

 
42,277

 
40,085

Miscellaneous loan fees and charges
1,055

 
1,142

 
1,342

 
3,354

 
3,571

Gain on sale of loans
7,326

 
7,600

 
6,000

 
20,356

 
14,373

Loss on sale of investments
(31
)
 
(98
)
 
(61
)
 
(124
)
 
(160
)
Other income
2,474

 
2,855

 
2,832

 
8,431

 
8,455

Total non-interest income
25,799

 
25,802

 
24,432

 
74,294

 
66,324

Non-Interest Expense
 
 
 
 
 
 
 
 
 
Compensation and employee benefits
33,534

 
32,729

 
30,142

 
98,507

 
87,764

Occupancy and equipment
7,887

 
7,810

 
6,961

 
23,059

 
20,307

Advertising and promotions
2,459

 
2,240

 
2,141

 
6,626

 
5,866

Data processing
1,258

 
1,593

 
1,472

 
4,100

 
4,792

Other real estate owned
1,047

 
1,377

 
602

 
3,182

 
1,675

Regulatory assessments and insurance
1,478

 
1,006

 
1,435

 
3,789

 
4,055

Core deposit intangibles amortization
720

 
755

 
692

 
2,206

 
2,095

Other expenses
10,729

 
12,435

 
10,793

 
33,085

 
30,427

Total non-interest expense
59,112

 
59,945

 
54,238

 
174,554

 
156,981

Income Before Income Taxes
38,919

 
36,823

 
39,094

 
112,277

 
111,764

Federal and state income tax expense
9,305

 
7,488

 
9,800

 
25,658

 
27,063

Net Income
$
29,614

 
29,335

 
29,294

 
86,619

 
84,701

Basic earnings per share
$
0.39

 
0.39

 
0.40

 
1.15

 
1.14

Diluted earnings per share
$
0.39

 
0.39

 
0.40

 
1.15

 
1.14

Dividends declared per share
$
0.19

 
0.19

 
0.17

 
0.56

 
0.50

Average outstanding shares - basic
75,531,923

 
75,530,591

 
74,631,317

 
75,424,147

 
74,512,806

Average outstanding shares - diluted
75,586,453

 
75,565,655

 
74,676,124

 
75,469,355

 
74,554,263


14


Glacier Bancorp, Inc.
Average Balance Sheet

 
Three Months ended
 
Nine Months ended
 
September 30, 2015
 
September 30, 2015
(Dollars in thousands)
Average
Balance
 
Interest &
Dividends
 
Average
Yield/
Rate
 
Average
Balance
 
Interest &
Dividends
 
Average
Yield/
Rate
Assets
 
 
 
 
 
 
 
 
 
 
 
Residential real estate loans
$
679,037

 
$
7,878

 
4.64
%
 
$
673,084

 
$
23,581

 
4.67
%
Commercial loans 1
3,510,098

 
42,811

 
4.84
%
 
3,411,631

 
123,759

 
4.85
%
Consumer and other loans
639,155

 
7,915

 
4.91
%
 
625,726

 
23,677

 
5.06
%
Total loans 2
4,828,290

 
58,604

 
4.82
%
 
4,710,441

 
171,017

 
4.85
%
Tax-exempt investment securities 3
1,334,980

 
19,511

 
5.85
%
 
1,317,788

 
57,026

 
5.77
%
Taxable investment securities 4
1,930,378

 
10,063

 
2.09
%
 
1,894,572

 
30,472

 
2.14
%
Total earning assets
8,093,648

 
88,178

 
4.32
%
 
7,922,801

 
258,515

 
4.36
%
Goodwill and intangibles
142,031

 
 
 
 
 
141,851

 
 
 
 
Non-earning assets
384,452

 
 
 
 
 
385,216

 
 
 
 
Total assets
$
8,620,131

 
 
 
 
 
$
8,449,868

 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
 
 
Non-interest bearing deposits
$
1,793,899

 
$
—

 
—
%
 
$
1,702,459

 
$
—

 
—
%
NOW accounts
1,387,334

 
264

 
0.08
%
 
1,347,658

 
790

 
0.08
%
Savings accounts
763,430

 
90

 
0.05
%
 
740,905

 
263

 
0.05
%
Money market deposit accounts
1,349,244

 
514

 
0.15
%
 
1,330,212

 
1,544

 
0.16
%
Certificate accounts
1,125,276

 
1,657

 
0.58
%
 
1,147,820

 
5,284

 
0.62
%
Wholesale deposits 5
190,724

 
1,422

 
2.96
%
 
208,640

 
4,325

 
2.77
%
FHLB advances
329,797

 
2,273

 
2.70
%
 
315,068

 
6,685

 
2.80
%
Repurchase agreements and other borrowed funds
512,807

 
1,089

 
0.84
%
 
504,787

 
3,169

 
0.84
%
Total funding liabilities
7,452,511

 
7,309

 
0.39
%
 
7,297,549

 
22,060

 
0.40
%
Other liabilities
92,955

 
 
 
 
 
90,300

 
 
 
 
Total liabilities
7,545,466

 
 
 
 
 
7,387,849

 
 
 
 
Stockholders’ Equity
 
 
 
 
 
 
 
 
 
 
 
Common stock
755

 
 
 
 
 
754

 
 
 
 
Paid-in capital
720,325

 
 
 
 
 
717,424

 
 
 
 
Retained earnings
344,768

 
 
 
 
 
329,630

 
 
 
 
Accumulated other comprehensive income
8,817

 
 
 
 
 
14,211

 
 
 
 
Total stockholders’ equity
1,074,665

 
 
 
 
 
1,062,019

 
 
 
 
Total liabilities and stockholders’ equity
$
8,620,131

 
 
 
 
 
$
8,449,868

 
 
 
 
Net interest income (tax-equivalent)
 
 
$
80,869

 
 
 
 
 
$
236,455

 
 
Net interest spread (tax-equivalent)
 
 
 
 
3.93
%
 
 
 
 
 
3.96
%
Net interest margin (tax-equivalent)
 
 
 
 
3.96
%
 
 
 
 
 
3.99
%
__________ 
1 
Includes tax effect of $674 thousand and $1.9 million on tax-exempt municipal loan and lease income for the three and nine months ended September 30, 2015.
2 
Total loans are gross of the allowance for loan and lease losses, net of unearned income and include loans held for sale. Non-accrual loans were included in the average volume for the entire period.
3 
Includes tax effect of $6.8 million and $19.1 million on tax-exempt investment security income for the three and nine months ended September 30, 2015.
4 
Includes tax effect of $362 thousand and $1.1 million on federal income tax credits for the three and nine months ended September 30, 2015.
5 
Wholesale deposits include brokered deposits classified as NOW, money market deposit and certificate accounts.

15


Glacier Bancorp, Inc.
Loan Portfolio by Regulatory Classification

 
Loans Receivable, by Loan Type
 
% Change from
(Dollars in thousands)
Sep 30,
2015
 
Jun 30,
2015
 
Dec 31,
2014
 
Sep 30,
2014
 
Jun 30,
2015
 
Dec 31,
2014
 
Sep 30,
2014
Custom and owner occupied construction
$
64,951

 
$
56,460

 
$
56,689

 
$
59,121

 
15
 %
 
15
 %
 
10
 %
Pre-sold and spec construction
46,921

 
45,063

 
47,406

 
44,085

 
4
 %
 
(1
)%
 
6
 %
Total residential construction
111,872

 
101,523

 
104,095

 
103,206

 
10
 %
 
7
 %
 
8
 %
Land development
83,756

 
78,059

 
82,829

 
88,507

 
7
 %
 
1
 %
 
(5
)%
Consumer land or lots
98,490

 
98,365

 
101,818

 
99,003

 
—
 %
 
(3
)%
 
(1
)%
Unimproved land
74,439

 
76,726

 
86,116

 
66,684

 
(3
)%
 
(14
)%
 
12
 %
Developed lots for operative builders
13,697

 
13,673

 
14,126

 
15,471

 
—
 %
 
(3
)%
 
(11
)%
Commercial lots
22,937

 
20,047

 
16,205

 
16,050

 
14
 %
 
42
 %
 
43
 %
Other construction
122,347

 
126,966

 
150,075

 
149,207

 
(4
)%
 
(18
)%
 
(18
)%
Total land, lot, and other construction
415,666

 
413,836

 
451,169

 
434,922

 
—
 %
 
(8
)%
 
(4
)%
Owner occupied
885,736

 
874,651

 
849,148

 
834,742

 
1
 %
 
4
 %
 
6
 %
Non-owner occupied
739,057

 
718,024

 
674,381

 
658,429

 
3
 %
 
10
 %
 
12
 %
Total commercial real estate
1,624,793

 
1,592,675

 
1,523,529

 
1,493,171

 
2
 %
 
7
 %
 
9
 %
Commercial and industrial
619,688

 
635,259

 
547,910

 
573,617

 
(2
)%
 
13
 %
 
8
 %
Agriculture
386,523

 
374,258

 
310,785

 
317,506

 
3
 %
 
24
 %
 
22
 %
1st lien
801,705

 
802,152

 
775,785

 
782,116

 
—
 %
 
3
 %
 
3
 %
Junior lien
67,351

 
67,019

 
68,358

 
71,678

 
—
 %
 
(1
)%
 
(6
)%
Total 1-4 family
869,056

 
869,171

 
844,143

 
853,794

 
—
 %
 
3
 %
 
2
 %
Multifamily residential
189,944

 
195,674

 
160,426

 
168,760

 
(3
)%
 
18
 %
 
13
 %
Home equity lines of credit
359,605

 
356,077

 
334,788

 
322,442

 
1
 %
 
7
 %
 
12
 %
Other consumer
154,095

 
147,427

 
133,773

 
139,045

 
5
 %
 
15
 %
 
11
 %
Total consumer
513,700

 
503,504

 
468,561

 
461,487

 
2
 %
 
10
 %
 
11
 %
Other
185,633

 
174,732

 
124,203

 
118,234

 
6
 %
 
49
 %
 
57
 %
Total loans receivable, including loans held for sale
4,916,875

 
4,860,632

 
4,534,821

 
4,524,697

 
1
 %
 
8
 %
 
9
 %
Less loans held for sale 1
(40,456
)
 
(53,201
)
 
(46,726
)
 
(65,598
)
 
(24
)%
 
(13
)%
 
(38
)%
Total loans receivable
$
4,876,419

 
$
4,807,431

 
$
4,488,095

 
$
4,459,099

 
1
 %
 
9
 %
 
9
 %
_______
1 Loans held for sale are primarily 1st lien 1-4 family loans.


16


Glacier Bancorp, Inc.
Credit Quality Summary by Regulatory Classification

 
 
Non-performing Assets, by Loan Type
 
Non-
Accrual
Loans
 
Accruing
Loans 90  Days or  More Past  Due
 
Other
Real Estate
Owned
(Dollars in thousands)
Sep 30,
2015
 
Jun 30,
2015
 
Dec 31,
2014
 
Sep 30,
2014
 
Sep 30,
2015
Sep 30,
2015
Sep 30,
2015
Custom and owner occupied construction
$
1,048

 
1,079

 
1,132

 
1,164

 
1,048

 
—

 
—

Pre-sold and spec construction
—

 
18

 
218

 
222

 
—

 
—

 
—

Total residential construction
1,048

 
1,097

 
1,350

 
1,386

 
1,048

 
—

 
—

Land development
17,719

 
20,405

 
20,842

 
24,803

 
7,769

 
—

 
9,950

Consumer land or lots
2,430

 
2,647

 
3,581

 
3,451

 
1,105

 
—

 
1,325

Unimproved land
12,055

 
12,580

 
14,170

 
13,659

 
8,607

 
—

 
3,448

Developed lots for operative builders
492

 
848

 
1,318

 
1,672

 
270

 
—

 
222

Commercial lots
1,631

 
2,050

 
2,660

 
2,697

 
241

 
—

 
1,390

Other construction
4,244

 
4,244

 
5,151

 
5,154

 
—

 
—

 
4,244

Total land, lot and other construction
38,571

 
42,774

 
47,722

 
51,436

 
17,992

 
—

 
20,579

Owner occupied
12,719

 
13,057

 
13,574

 
14,913

 
8,220

 
1,444

 
3,055

Non-owner occupied
3,833

 
3,179

 
3,013

 
3,768

 
2,713

 
—

 
1,120

Total commercial real estate
16,552

 
16,236

 
16,587

 
18,681

 
10,933

 
1,444

 
4,175

Commercial and industrial
5,110

 
5,805

 
4,375

 
4,833

 
4,868

 
199

 
43

Agriculture
3,114

 
2,769

 
3,074

 
3,430

 
2,499

 
167

 
448

1st lien
11,953

 
9,867

 
9,580

 
13,236

 
10,538

 
107

 
1,308

Junior lien
660

 
739

 
442

 
481

 
660

 
—

 
—

Total 1-4 family
12,613

 
10,606

 
10,022

 
13,717

 
11,198

 
107

 
1,308

Multifamily residential
—

 
—

 
440

 
450

 
—

 
—

 
—

Home equity lines of credit
6,013

 
4,742

 
6,099

 
3,985

 
5,991

 
22

 
—

Other consumer
204

 
164

 
231

 
222

 
103

 
45

 
56

Total consumer
6,217

 
4,906

 
6,330

 
4,207

 
6,094

 
67

 
56

Other
1,800

 
29

 
—

 
—

 
—

 
1,800

 
—

Total
$
85,025

 
84,222

 
89,900

 
98,140

 
54,632

 
3,784

 
26,609



17


Glacier Bancorp, Inc.
Credit Quality Summary by Regulatory Classification (continued)

 
Accruing 30-89 Days Delinquent Loans,  by Loan Type
 
% Change from
(Dollars in thousands)
Sep 30,
2015
 
Jun 30,
2015
 
Dec 31,
2014
 
Sep 30,
2014
 
Jun 30,
2015
 
Dec 31,
2014
 
Sep 30,
2014
Custom and owner occupied construction
$
138

 
$
—

 
$
—

 
$
—

 
n/m

 
n/m

 
n/m

Pre-sold and spec construction
144

 
—

 
869

 
179

 
n/m

 
(83
)%
 
(20
)%
Total residential construction
282

 
—

 
869

 
179

 
n/m

 
(68
)%
 
58
 %
Consumer land or lots
266

 
158

 
391

 
62

 
68
 %
 
(32
)%
 
329
 %
Unimproved land
304

 
755

 
267

 
1,177

 
(60
)%
 
14
 %
 
(74
)%
Developed lots for operative builders
—

 
—

 
—

 
21

 
n/m

 
n/m

 
(100
)%
Commercial lots
—

 
66

 
21

 
106

 
(100
)%
 
(100
)%
 
(100
)%
Other construction
—

 
—

 
—

 
660

 
n/m

 
n/m

 
(100
)%
Total land, lot and other construction
570

 
979

 
679

 
2,026

 
(42
)%
 
(16
)%
 
(72
)%
Owner occupied
2,497

 
4,727

 
5,971

 
4,341

 
(47
)%
 
(58
)%
 
(42
)%
Non-owner occupied
5,529

 
8,257

 
3,131

 
266

 
(33
)%
 
77
 %
 
1,979
 %
Total commercial real estate
8,026

 
12,984

 
9,102

 
4,607

 
(38
)%
 
(12
)%
 
74
 %
Commercial and industrial
2,774

 
6,760

 
2,915

 
3,376

 
(59
)%
 
(5
)%
 
(18
)%
Agriculture
867

 
353

 
994

 
152

 
146
 %
 
(13
)%
 
470
 %
1st lien
2,510

 
2,891

 
6,804

 
3,738

 
(13
)%
 
(63
)%
 
(33
)%
Junior lien
228

 
335

 
491

 
275

 
(32
)%
 
(54
)%
 
(17
)%
Total 1-4 family
2,738

 
3,226

 
7,295

 
4,013

 
(15
)%
 
(62
)%
 
(32
)%
Multifamily Residential
114

 
671

 
—

 
684

 
(83
)%
 
n/m

 
(83
)%
Home equity lines of credit
1,599

 
2,464

 
1,288

 
1,725

 
(35
)%
 
24
 %
 
(7
)%
Other consumer
811

 
996

 
928

 
789

 
(19
)%
 
(13
)%
 
3
 %
Total consumer
2,410

 
3,460

 
2,216

 
2,514

 
(30
)%
 
9
 %
 
(4
)%
Other
41

 
41

 
1,834

 
19

 
—
 %
 
(98
)%
 
116
 %
Total
$
17,822

 
$
28,474

 
$
25,904

 
$
17,570

 
(37
)%
 
(31
)%
 
1
 %
_______
n/m - not measurable


18


Glacier Bancorp, Inc.
Credit Quality Summary by Regulatory Classification (continued)

 
Net Charge-Offs (Recoveries), Year-to-Date
Period Ending, By Loan Type
 
Charge-Offs
 
Recoveries
(Dollars in thousands)
Sep 30,
2015
 
Jun 30,
2015
 
Dec 31,
2014
 
Sep 30,
2014
 
Sep 30,
2015
Sep 30,
2015
Pre-sold and spec construction
$
(34
)
 
(23
)
 
(94
)
 
(58
)
 
—

 
34

Land development
(293
)
 
(807
)
 
(390
)
 
(319
)
 
828

 
1,121

Consumer land or lots
(8
)
 
(77
)
 
375

 
69

 
306

 
314

Unimproved land
(152
)
 
(86
)
 
52

 
(186
)
 
—

 
152

Developed lots for operative builders
(72
)
 
(98
)
 
(140
)
 
(125
)
 
51

 
123

Commercial lots
(5
)
 
(3
)
 
(6
)
 
(5
)
 
—

 
5

Other construction
(1
)
 
(1
)
 
—

 
—

 
—

 
1

Total land, lot and other construction
(531
)
 
(1,072
)
 
(109
)
 
(566
)
 
1,185

 
1,716

Owner occupied
249

 
271

 
669

 
201

 
587

 
338

Non-owner occupied
105

 
109

 
(162
)
 
(44
)
 
116

 
11

Total commercial real estate
354

 
380

 
507

 
157

 
703

 
349

Commercial and industrial
1,011

 
1,007

 
1,069

 
932

 
1,638

 
627

Agriculture
(8
)
 
(7
)
 
28

 
(1
)
 
—

 
8

1st lien
(80
)
 
(49
)
 
372

 
207

 
39

 
119

Junior lien
(106
)
 
(129
)
 
183

 
199

 
79

 
185

Total 1-4 family
(186
)
 
(178
)
 
555

 
406

 
118

 
304

Multifamily residential
(318
)
 
(29
)
 
138

 
138

 
—

 
318

Home equity lines of credit
531

 
206

 
190

 
222

 
660

 
129

Other consumer
39

 
(3
)
 
226

 
210

 
367

 
328

Total consumer
570

 
203

 
416

 
432

 
1,027

 
457

Total
$
858

 
281

 
2,510

 
1,440

 
4,671

 
3,813














Visit our website at www.glacierbancorp.com

19

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