Glacier Bancorp, Inc. Announces results for the Quarter Ended September 30, 2019

3rd Quarter 2019 Highlights:

• Net income of $51.6 million for the current quarter, an increase of $2.3 million, or 5 percent, over the prior year third quarter net income of $49.3 million including current period acquisition-related expenses of $2.1 million and $5.4 million of stock compensation expense related to the accelerated vesting of stock options from the Heritage Bancorp acquisition.
• Including the above acquisition-related expenses, current quarter diluted earnings per share of $0.57, a decrease of 2 percent from the prior year third quarter diluted earnings per share of $0.58. 
• Net interest margin of 4.42 percent increased 9 basis points compared to 4.33 percent in the prior quarter and increased 16 basis points over the prior year third quarter.
• Core deposits organically grew $302 million, or 12 percent annualized, during the current quarter, including non-interest bearing deposit growth of $211 million, or 26 percent annualized.
• Current quarter organic loan growth was $84 million, or 4 percent annualized.
• Gain on sale of loans of $10.4 million for the current quarter, increased $2.6 million, or 34 percent, compared to the prior quarter and increased $3.1 million, or 43 percent, over the prior year third quarter.
• Improving credit quality with non-performing assets as a percentage of subsidiary assets decreasing to 0.40 percent in the current quarter compared to 0.41 percent for the prior quarter and 0.61 percent from the prior year third quarter.
• In early September, the Company implemented a balance sheet strategy which resulted in the reduction of $260 million of high cost fixed-rate borrowings with an effective cost of 3.73 percent.
• Dividend declared of $0.29 per share, or a 7 percent increase over the prior quarterly dividend of $0.27 per share.  The Company has declared 138 consecutive quarterly dividends and has increased the dividend 45 times.
• The Company entered Nevada by completing the acquisition of Heritage Bancorp, the parent company of Heritage Bank of Nevada (collectively, "Heritage"), a community bank based in Reno, Nevada, with total assets of $978 million.
• The Company announced the signing of a definitive agreement to acquire State Bank Corp., the parent company of State Bank of Arizona, a community bank based in Lake Havasu City, Arizona with total assets of $677 million at September 30, 2019 to further grow its Arizona presence.

Year-to-Date 2019 Highlights:

• Net income of $153 million for the first nine months of 2019, an increase of $20.9 million, or 16 percent, over the first nine months of 2018 net income of $132 million.
• Diluted earnings per share of $1.76, an increase of 11 percent from the prior year first nine months diluted earnings per share of $1.59.
• Net interest margin of 4.36 percent for the first nine months of 2019, an increase of 18 basis points from the net interest margin of 4.18 percent for the first nine months of 2018.
• Core deposits organically grew $412 million, or 6 percent annualized, for the first nine months of 2019, including non-interest bearing deposit growth of $382 million, or 17 percent annualized.
• Organic loan growth was $393 million, or 6 percent annualized, for the first nine months of 2019.
• Dividend declared of $0.82 per share, an increase of $0.07 per share, or 9 percent, over the prior year first nine months dividends of $0.75.

Financial Highlights 

	At or for the Three Months ended									At or for the Nine Months ended
(Dollars in thousands, except per share and market data)	Sep 30, 2019			Jun 30, 2019		Mar 31, 2019		Sep 30, 2018		Sep 30, 2019		Sep 30, 2018
Operating results
Net income	$	51,610		52,392		49,132		49,336		153,134		132,279
Basic earnings per share	$	0.57		0.61		0.58		0.58		1.76		1.59
Diluted earnings per share	$	0.57		0.61		0.58		0.58		1.76		1.59
Dividends declared per share	$	0.29		0.27		0.26		0.26		0.82		0.75
Market value per share
Closing	$	40.46		40.55		40.07		43.09		40.46		43.09
High	$	42.61		43.44		45.47		46.28		45.47		46.28
Low	$	37.70		38.65		37.58		38.37		37.58		35.77
Selected ratios and other data
Number of common stock shares outstanding	92,180,618			86,637,394		84,588,199		84,521,093		92,180,618		84,521,093
Average outstanding shares - basic	90,294,811			85,826,290		84,549,974		84,518,407		86,911,402		83,294,111
Average outstanding shares - diluted	90,449,195			85,858,286		84,614,248		84,593,122		87,082,178		83,362,323
Return on average assets (annualized)	1.55 %			1.69 %		1.67 %		1.66 %		1.63 %		1.57 %
Return on average equity (annualized)	10.92 %			12.82 %		13.02 %		13.10 %		12.17 %		12.38 %
Efficiency ratio	65.95 %			54.50 %		55.37 %		52.26 %		58.82 %		55.01 %
Dividend payout ratio	50.88 %			44.26 %		44.83 %		44.83 %		46.59 %		47.17 %
Loan to deposit ratio	88.71 %			90.27 %		87.14 %		85.13 %		88.71 %		85.13 %
Number of full time equivalent employees	2,802			2,703		2,634		2,572		2,802		2,572
Number of locations	182			175		169		164		182		164
Number of ATMs	238			228		222		215		238		215

KALISPELL, Mont., Oct. 17, 2019 (GLOBE NEWSWIRE) -- Glacier Bancorp, Inc. (NASDAQ: GBCI) reported net income of $51.6 million for the current quarter, an increase of $2.3 million, or 5 percent, from the $49.3 million of net income for the prior year third quarter.  Diluted earnings per share for the current quarter was $0.57 per share, a decrease of 2 percent from the prior year third quarter diluted earnings per share of $0.58.  Included in the current quarter was acquisition-related expenses of $2.1 million and $5.4 million of stock compensation expense related to the accelerated vesting of stock options from the Heritage acquisition.  “We are very pleased with the strong results achieved this quarter even with the expense from the acquisition of Heritage and the impact of the Durbin Amendment.  We are especially pleased to see strong deposit growth, good quality loan growth, an expanding core margin and further improving credit performance,” said Randy Chesler, President and Chief Executive Officer.  “The Glacier team once again achieved excellent results as we position the Company to continue to excel over the long haul.  We are also very excited to welcome the Heritage team, one of the top performing community banks in the country.”

The current quarter results include:

• $2.1 million of acquisition-related expenses and $5.4 million of stock compensation expense related to the accelerated vesting of stock options from the Heritage acquisition. 
• As of July 1, 2019, the Company became subject to the Durbin Amendment to the Dodd-Frank Act, which established limits on the amount of interchange fees that can be charged to merchants for debit card processing. The current quarter impact of the Durbin Amendment was a reduction of $5 million, or 57 percent, of the Company's service charge fee income.      
• The Company's regulatory assessment and insurance expense decreased $1.3 million, or 68 percent, from the prior quarter as a result of $1.3 million of Small Bank Assessment credits applied by the FDIC. The Company’s remaining credit of $1.6 million will be applied in future quarters in amounts solely determined by the FDIC.

Net income for the first nine months ended September 30, 2019 was $153 million, an increase of $20.9 million, or 16 percent, from the $132 million of net income for the first nine months of the prior year.  Diluted earnings per share for the first nine months of the current year was $1.76 per share, an increase of $0.17, or 11 percent, from the diluted earnings per share of $1.59 for the same period in the prior year.

In September of 2019, the Company announced the signing of a definitive agreement to acquire State Bank Corp., the parent company of State Bank of Arizona, a community bank based in Lake Havasu City, Arizona (collectively, "SBAZ").  SBAZ provides banking services to individuals and businesses in Arizona with ten banking offices located in Bullhead City, Cottonwood, Kingman, Lake Havasu City, Phoenix, Prescott Valley and Prescott.  As of September 30, 2019, SBAZ had total assets of $677 million, gross loans of $413 million and total deposits of $587 million.  The acquisition is subject to required regulatory approvals and other customary conditions of closing and is expected to be completed in the fourth quarter of 2019 or early in the first quarter of 2020.  Upon closing of the transaction, SBAZ will merge into the Company's Foothills Bank division and will expand the Company's footprint in Arizona.

On July 31, 2019, the Company completed the acquisition of Heritage Bancorp, the bank holding company for Heritage Bank of Nevada, a community bank based in Reno, Nevada (collectively, “Heritage”).  Upon closing of the transaction, Heritage  became the Company’s sixteenth Bank division.

On April 30, 2019, the Company completed the acquisition of FNB Bancorp, the holding company for The First National Bank of Layton, a community bank based in Layton, Utah (“FNB”).  Upon closing of the transaction, FNB became First Community Bank Utah, the Company’s fifteenth Bank division. 

The Company’s results of operations and financial condition include both acquisitions beginning on the acquisition dates and the following table discloses the preliminary fair value estimates of selected classifications of assets and liabilities acquired:

	Heritage		FNB
(Dollars in thousands)	July 31, 2019		April 30, 2019			Total
Total assets	977,948		$	379,155		1,357,103
Debt securities	103,231		47,247			150,478
Loans receivable	615,279		245,485			860,764
Non-interest bearing deposits	296,393		93,647			390,040
Interest bearing deposits	425,827		180,999			606,826
Borrowings	—		7,273			7,273

Asset Summary

														$ Change from
(Dollars in thousands)	Sep 30, 2019				Jun 30, 2019			Dec 31, 2018			Sep 30, 2018			Jun 30, 2019			Dec 31, 2018			Sep 30, 2018
Cash and cash equivalents	$	406,384			231,209			203,790			307,104			175,175			202,594			99,280
Debt securities, available-for-sale	2,459,036				2,470,634			2,571,663			2,103,619			(11,598	)		(112,627	)		355,417
Debt securities, held-to-maturity	234,992				252,097			297,915			590,915			(17,105	)		(62,923	)		(355,923	)
Total debt securities	2,694,028				2,722,731			2,869,578			2,694,534			(28,703	)		(175,550	)		(506	)
Loans receivable
Residential real estate	936,877				920,715			887,742			862,830			16,162			49,135			74,047
Commercial real estate	5,548,174				4,959,863			4,657,561			4,527,577			588,311			890,613			1,020,597
Other commercial	2,145,257				2,076,605			1,911,171			1,921,955			68,652			234,086			223,302
Home equity	615,781				596,041			544,688			528,404			19,740			71,093			87,377
Other consumer	294,999				288,553			286,387			282,479			6,446			8,612			12,520
Loans receivable	9,541,088				8,841,777			8,287,549			8,123,245			699,311			1,253,539			1,417,843
Allowance for loan and lease losses	(125,535		)		(129,054	)		(131,239	)		(132,535	)		3,519			5,704			7,000
Loans receivable, net	9,415,553				8,712,723			8,156,310			7,990,710			702,830			1,259,243			1,424,843
Other assets	1,202,827				1,009,698			885,806			916,754			193,129			317,021			286,073
Total assets	$	13,718,792			12,676,361			12,115,484			11,909,102			1,042,431			1,603,308			1,809,690

In early September, the Company implemented a balance sheet strategy to increase its net interest income and net interest margin.  The strategy included early termination of the Company’s $260 million notional pay-fixed interest rate swaps and corresponding debt along with the sale of $308 million of available-for-sale debt securities.  Sale of the investment securities during the quarter resulted in gain of $13.8 million.  Offsetting the gain was a $10.0 million loss recognized on the early termination of the interest rate swaps and a $3.5 million write-off of deferred prepayment penalties on FHLB borrowings.

Total debt securities of $2.694 billion at September 30, 2019 decreased $28.7 million, or 1 percent, during the current quarter and remained stable compared to the prior year third quarter.  Debt securities represented 20 percent of total assets at September 30, 2019 compared to 24 percent of total assets at December 31, 2018 and 23 percent at September 30, 2018.  The level of debt securities will continue to fluctuate as necessary to supplement liquidity needs of the Company. 

The loan portfolio of $9.541 billion increased $84 million, or 4 percent annualized, during the current quarter excluding the Heritage acquisition.  The loan categories with the largest organic increase was commercial real estate loans which increased $39.6 million, or 1 percent and other commercial loans which increased $37.7 million, or 2 percent.  Excluding the FNB and Heritage acquisitions, the loan portfolio increased $557 million, or 7 percent, since September 30, 2018, with the largest increase in commercial real estate loans, which increased $293 million, or 6 percent.

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.

Credit Quality Summary

	At or for the NineMonths ended				At or for the SixMonths ended			At or for theYear ended			At or for the NineMonths ended
(Dollars in thousands)	Sep 30, 2019				Jun 30, 2019			Dec 31, 2018			Sep 30, 2018
Allowance for loan and lease losses
Balance at beginning of period	$	131,239			131,239			129,568			129,568
Provision for loan losses	57				57			9,953			8,707
Charge-offs	(12,090		)		(6,200	)		(17,807	)		(11,905	)
Recoveries	6,329				3,958			9,525			6,165
Balance at end of period	$	125,535			129,054			131,239			132,535
Other real estate owned	$	7,148			7,281			7,480			12,399
Accruing loans 90 days or more past due	7,912				3,463			2,018			4,333
Non-accrual loans	40,017				41,195			47,252			55,373
Total non-performing assets	$	55,077			51,939			56,750			72,105
Non-performing assets as a percentage of subsidiary assets	0.40 %				0.41 %			0.47 %			0.61 %
Allowance for loan and lease losses as a percentage of non-performing loans	262 %				289 %			266 %			222 %
Allowance for loan and lease losses as a percentage of total loans	1.32 %				1.46 %			1.58 %			1.63 %
Net charge-offs as a percentage of total loans	0.06 %				0.03 %			0.10 %			0.07 %
Accruing loans 30-89 days past due	$	29,954			37,937			33,567			25,181
Accruing troubled debt restructurings	$	32,949			25,019			25,833			35,080
Non-accrual troubled debt restructurings	$	6,723			6,041			10,660			12,911
U.S. government guarantees included in non-performing assets	$	3,000			2,785			4,811			5,791

Non-performing assets as a percentage of subsidiary assets at September 30, 2019 was 0.40 percent, a decrease of 1 basis point from the prior quarter, and a decrease of 21 basis points from the prior year third quarter.  Non-performing assets of $55.1 million at September 30, 2019 increased $3.1 million, or 6 percent, over the prior quarter and decreased $17.0 million, or 24 percent, over the prior year third quarter.  The increase in the current quarter non-performing assets was isolated to a $2.7 million loan.  Early stage delinquencies (accruing loans 30-89 days past due) as a percentage of loans at September 30, 2019 was 0.31 percent, which was a decrease of 12 basis points from prior quarter and no change from prior year third quarter.  Early stage delinquencies of $30.0 million at September 30, 2019 decreased $8.0 million from the prior quarter and increased $4.8 million from the prior year third quarter.   The allowance for loan and lease losses (“allowance”) as a percent of total loans outstanding at September 30, 2019 was 1.32 percent, which was a 14 basis points decrease compared to the prior quarter and a decrease of 31 basis points from a year ago.  The decrease was attributable to stabilizing credit quality and the addition of loans from the acquisitions which were added to the portfolio on a fair value basis and as a result did not require an allowance at acquisition date.

Credit Quality Trends and Provision for Loan Losses

(Dollars in thousands)	Provision for Loan Losses			Net Charge-Offs			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 2019	$	—		$	3,519		1.32		%		0.31		%		0.40		%
Second quarter 2019	—			732			1.46		%		0.43		%		0.41		%
First quarter 2019	57			1,510			1.56		%		0.44		%		0.42		%
Fourth quarter 2018	1,246			2,542			1.58		%		0.41		%		0.47		%
Third quarter 2018	3,194			2,223			1.63		%		0.31		%		0.61		%
Second quarter 2018	4,718			762			1.66		%		0.50		%		0.71		%
First quarter 2018	795			2,755			1.66		%		0.59		%		0.64		%
Fourth quarter 2017	2,886			2,894			1.97		%		0.57		%		0.68		%

Net charge-offs for the current quarter were $3.5 million compared to $732 thousand for the prior quarter and $2.2 million from the same quarter last year.  The increase in net charge-offs were primarily centered in one loan with a $1.9 million loss resulting from a negotiated short-sale. There was no current or prior quarter provision for loan losses compared to $3.2 million in 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. 

Liability Summary

										$ Change from
(Dollars in thousands)	Sep 30, 2019			Jun 30, 2019		Dec 31, 2018		Sep 30, 2018		Jun 30, 2019			Dec 31, 2018			Sep 30, 2018
Deposits
Non-interest bearing deposits	$	3,772,766		3,265,077		3,001,178		3,103,112		507,689			771,588			669,654
NOW and DDA accounts	2,592,483			2,487,806		2,391,307		2,346,050		104,677			201,176			246,433
Savings accounts	1,472,465			1,412,046		1,346,790		1,345,163		60,419			125,675			127,302
Money market deposit accounts	1,940,517			1,647,372		1,684,284		1,722,975		293,145			256,233			217,542
Certificate accounts	955,765			897,625		901,484		932,461		58,140			54,281			23,304
Core deposits, total	10,733,996			9,709,926		9,325,043		9,449,761		1,024,070			1,408,953			1,284,235
Wholesale deposits	134,629			144,949		168,724		151,421		(10,320	)		(34,095	)		(16,792	)
Deposits, total	10,868,625			9,854,875		9,493,767		9,601,182		1,013,750			1,374,858			1,267,443
Repurchase agreements	558,752			494,651		396,151		408,754		64,101			162,601			149,998
Federal Home Loan Bank advances	8,707			319,996		440,175		155,328		(311,289	)		(431,468	)		(146,621	)
Other borrowed funds	14,808			14,765		14,708		9,944		43			100			4,864
Subordinated debentures	139,913			139,912		134,051		134,055		1			5,862			5,858
Other liabilities	174,586			164,786		120,778		107,227		9,800			53,808			67,359
Total liabilities	$	11,765,391		10,988,985		10,599,630		10,416,490		776,406			1,165,761			1,348,901

As a result of the Bank's continued focus on stable and steady low cost deposits, in particular non-interest bearing deposits, the Company experienced a strong quarter in deposit growth.  Excluding the acquisitions, core deposits of $10.734 billion as of September 30, 2019 increased $302 million, or 12 percent annualized, from the prior quarter and increased $287 million, or 3 percent, from the prior year third quarter.  Non-interest bearing deposits organically increased $211 million, or 26 percent annualized, over the prior quarter and increased $280 million, or 9 percent, over the prior year third quarter.  Non-interest bearing deposits were 35 percent of total deposits at the end of the third quarter, an increase of 2 percent from 33 percent at the end of the prior quarter and a 3 percent increase from 32 percent at the end of the prior year third quarter.

During the current quarter, the Company reduced its FHLB advances by $311 million. The Company utilized proceeds from the sale of debt securities and deposit growth to pay down this funding. As of September 30, 2019, the Company had $8.7 million of FHLB advances, and these advances will fluctuate as necessary for balance sheet growth and to supplement liquidity needs of the Company.

Stockholders’ Equity Summary

														$ Change from
(Dollars in thousands, except per share data)	Sep 30,2019				Jun 30,2019			Dec 31,2018			Sep 30,2018			Jun 30,2019			Dec 31,2018			Sep 30, 2018
Common equity	$	1,905,306			1,643,928			1,525,281			1,522,329			261,378			380,025			382,977
Accumulated other comprehensive income (loss)		48,095			43,448			(9,427	)		(29,717	)		4,647			57,522			77,812
Total stockholders’ equity		1,953,401			1,687,376			1,515,854			1,492,612			266,025			437,547			460,789
Goodwill and core deposit intangible, net		(522,274	)		(385,533	)		(338,828	)		(340,508	)		(136,741	)		(183,446	)		(181,766	)
Tangible stockholders’ equity	$	1,431,127			1,301,843			1,177,026			1,152,104			129,284			254,101			279,023
Stockholders’ equity to total assets		14.24 %			13.31 %			12.51 %			12.53 %
Tangible stockholders’ equity to total tangible assets		10.84 %			10.59 %			9.99 %			9.96 %
Book value per common share	$	21.19			19.48			17.93			17.66			1.71			3.26			3.53
Tangible book value per common share	$	15.53			15.03			13.93			13.63			0.50			1.60			1.90

Tangible stockholders’ equity of $1.431 billion at September 30, 2019 increased $129 million, or 10 percent,  compared to the prior quarter which was the result of $229 million of Company stock issued for the acquisition of Heritage and earnings retention, these increases more than offset the increase in goodwill and core deposits associated with the acquisition.  Tangible stockholders’ equity increased $279 million, or 24 percent, over the prior year third quarter which was the result of earnings retention, an increase in other comprehensive income, and the impact from the acquisitions which was offset by a decrease of $25.5 million from the cumulative-effect adjustments related to the adoption of new accounting standards.  Tangible book value per common share of $15.53 at current quarter end increased $0.50 per share from the prior quarter and increased $1.90 per share from a year ago.

Cash DividendsOn September 25, 2019, the Company’s Board of Directors declared a quarterly cash dividend of $0.29 per share, and increase of $0.02 per share, or 7 percent.  The dividend was payable October 17, 2019 to shareholders of record on October 8, 2019.  The Company has declared 138 consecutive quarterly dividends and has increased the dividend 45 times.  Future cash dividends will depend on a variety of factors, including net income, capital, asset quality, general economic conditions and regulatory considerations. 

Operating Results for Three Months Ended September 30, 2019 Compared to June 30, 2019, March 31, 2019, and September 30, 2018

Income Summary

	Three Months ended										$ Change from
(Dollars in thousands)	Sep 30, 2019			Jun 30, 2019		Mar 31, 2019		Sep 30, 2018			Jun 30, 2019			Mar 31, 2019			Sep 30, 2018
Net interest income
Interest income	$	142,395		132,385		126,116		122,905			10,010			16,279			19,490
Interest expense	10,947			12,089		10,904		9,160			(1,142	)		43			1,787
Total net interest income	131,448			120,296		115,212		113,745			11,152			16,236			17,703
Non-interest income
Service charges and other fees	15,138			20,025		18,015		19,504			(4,887	)		(2,877	)		(4,366	)
Miscellaneous loan fees and charges	1,775			1,192		967		1,807			583			808			(32	)
Gain on sale of loans	10,369			7,762		5,798		7,256			2,607			4,571			3,113
Gain (loss) on sale of investments	13,811			134		213		(367	)		13,677			13,598			14,178
Other income	1,956			1,721		3,481		4,216			235			(1,525	)		(2,260	)
Total non-interest income	43,049			30,834		28,474		32,416			12,215			14,575			10,633
Total income	174,497			151,130		143,686		146,161			23,367			30,811			28,336
Net interest margin (tax-equivalent)		4.42 %		4.33 %		4.34 %		4.26 %

Net Interest IncomeThe current quarter net interest income of $131 million increased $11.1 million, or 9 percent, over the prior quarter and increased $17.7 million, or 16 percent, from the prior year third quarter.  The increase in net interest income over the prior quarter and prior year third quarter was primarily driven by an increase in interest income on commercial loans.  Interest income on commercial loans increased $9.2 million, or 10 percent, from the prior quarter and increased $16.6 million, or 21 percent, from the prior year third quarter.

The current quarter interest expense of $10.9 million decreased $1.1 million, or 9 percent, over the prior quarter which was driven primarily by the decrease in FHLB advances during the current quarter.  The current quarter interest expense increased $1.8 million, or 20 percent, from the prior year third quarter and was primarily due to the increased amount of deposits, increased rates on deposits and an increase in repurchase agreements.  During the quarter, the total cost of funding (including non-interest bearing deposits) declined 6 basis points to 39 basis points compared to 45 basis points for the prior quarter and 36 basis points for 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 4.42 percent compared to 4.33 percent in the prior quarter.  The core net interest margin, excluding  $736 thousand, or 2 basis points, of discount accretion and $1.5 million, or 5 basis points, of non-accrual interest, was 4.35 percent compared to 4.27 in the prior quarter and 4.18 percent in the prior year third quarter.  The Company experienced an increase in the core net interest margin during the quarter from the reduction of FHLB borrowings, an increase in low cost deposits and the continued shift from lower yielding investments to higher yielding loans.  “The increase in net interest margin reflects the success our Bank divisions had in growing low cost core deposits, particularly non-interest bearing deposits,” said Ron Copher, Chief Financial Officer. “In addition, the balance sheet strategy executed in the third quarter allowed the Company to reduce high cost fixed-rate funding which will continue to have a positive impact on earnings and margin.”              

Non-interest IncomeNon-interest income for the current quarter totaled $43.0 million which was an increase of $12.2 million, or 40 percent, over the prior quarter and an increase of $10.6 million, or 33 percent, over the same quarter last year.  Service charges and other fees of $15.1 million for the current quarter decreased $4.9 million, or 24 percent, from the prior quarter and decreased $4.4 million, or 22 percent, from the prior year third quarter due to the Company's decrease in interchange fee as a result of the Durbin Amendment.  Gain on the sale of loans of $10.4 million for the current quarter, increased $2.6 million, or 34 percent, compared to the prior quarter and increased $3.1 million, or 43 percent, over the prior year third quarter as a result of increased purchase and refinance activity.  The Company sold $308 million of securities and recognized gain of $13.8 million, an increase of $13.7 million from the prior quarter.  Other income decreased $2.3 million from the prior year third quarter and was the result of a gain of $2.3 million on the sale of a former branch building in the prior year third quarter.

Non-interest Expense Summary

	Three Months ended									$ Change from
(Dollars in thousands)	Sep 30, 2019			Jun 30, 2019		Mar 31, 2019		Sep 30, 2018		Jun 30, 2019			Mar 31, 2019			Sep 30, 2018
Compensation and employee benefits	$	62,509		51,973		52,728		49,927		10,536			9,781			12,582
Occupancy and equipment	8,731			8,180		8,437		7,914		551			294			817
Advertising and promotions	2,719			2,767		2,388		2,432		(48	)		331			287
Data processing	4,466			4,062		3,892		3,752		404			574			714
Other real estate owned	166			191		139		2,674		(25	)		27			(2,508	)
Regulatory assessments and insurance	593			1,848		1,285		1,277		(1,255	)		(692	)		(684	)
Core deposit intangibles amortization	2,360			1,865		1,694		1,735		495			666			625
Other expenses	29,131			15,284		12,267		13,118		13,847			16,864			16,013
Total non-interest expense	110,675			86,170		82,830		82,829		24,505			27,845			27,846

Total non-interest expense of $111 million for the current quarter increased $24.5 million, or 28 percent, over the prior quarter and increased $27.8 million, or 34 percent, over the prior year third quarter.  Compensation and employee benefits increased by $10.5 million, or 20 percent, from the prior quarter and increased $12.6 million, or 25 percent from the prior year third quarter due to the $5.4 million of stock compensation expense related to the Heritage acquisition and an increased number of employees driven by acquisition and organic growth. Occupancy and equipment expense increased $551 thousand or 7 percent, over the prior quarter and increased $817 thousand, or 10 percent, over the prior year third quarter primarily as a result of the current year acquisitions.  Data processing expense increased $404 thousand or 10 percent, over the prior quarter and increased $714 thousand, or 19 percent, over the prior year third quarter primarily as a result of the current year acquisitions.  Regulatory assessment and insurance decreased $1.3 million, or 68 percent, from the prior quarter as a result of $1.3 million of Small Bank Assessment credits applied by the FDIC during the current quarter.  Other expenses of $29.1 million, increased $13.8 million, or 91 percent, from the prior quarter and was primarily driven by the a $3.5 million loss on the pay down of FHLB debt and a $10.0 million loss on the termination of cash flow hedges.  Acquisition-related expenses were $2.1 million during the current quarter compared to $1.8 million in the prior quarter and $1.3 million in the prior year third quarter.

Federal and State Income Tax ExpenseTax expense during the third quarter of 2019 was $12.2 million, a decrease of $356 thousand, or 3 percent, compared to the prior quarter and an increase of $1.4 million, or 13 percent, from the prior year third quarter.  The effective tax rate in the current and prior quarter was 19 percent which compares to 18 percent in the prior year third quarter.

Efficiency RatioThe current quarter efficiency ratio was 65.95 percent. Excluding the $10.0 million loss recognized on the termination of the interest rate swaps, the $3.5 million write-off of the deferred prepayment penalties on FHLB advances, and the $5.4 million of accelerated stock compensation expense the efficiency ratio would have been 54.41 percent, which was a decrease of 9 basis points from the prior quarter efficiency ratio of 54.50 percent and an increase of 215 basis points from the prior year third quarter efficiency ratio of 52.26 percent.  The lower efficiency ratio in the prior year third quarter included a gain of $2.3 million recognized on the sale of a former branch building. 

Operating Results for Nine Months Ended September 30, 2019 Compared to September 30, 2018

Income Summary

	Nine Months ended
(Dollars in thousands)	Sep 30, 2019			Sep 30, 2018				$ Change				% Change
Net interest income
Interest income	$	400,896		$	343,686			$	57,210			17		%
Interest expense	33,940			26,095				7,845				30		%
Total net interest income	366,956			317,591				49,365				16		%
Non-interest income
Service charges and other fees	53,178			55,179				(2,001		)		(4	)	%
Miscellaneous loan fees and charges	3,934			5,527				(1,593		)		(29	)	%
Gain on sale of loans	23,929			21,495				2,434				11		%
Gain (loss) on sale of investments	14,158			(756		)		14,914				(1,973	)	%
Other income	7,158			8,885				(1,727		)		(19	)	%
Total non-interest income	102,357			90,330				12,027				13		%
	$	469,313		$	407,921			$	61,392			15		%
Net interest margin (tax-equivalent)		4.36 %			4.18 %

Net Interest IncomeNet interest income for the first nine months of 2019 increased $49.4 million, or 16 percent, from the first nine months of 2018 and was primarily attributable to a $46.9 million increase in interest income from commercial loans.  Interest expense of $33.9 million for the first nine months of 2019 increased $7.8 million, or 30 percent over the prior year same period as a result of increased deposits and borrowings combined with interest rate increases.  The total funding cost (including non-interest bearing deposits) for the first nine months of 2019 was 42 basis points compared to 36 basis points for the first nine months of 2018.

The net interest margin as a percentage of earning assets, on a tax-equivalent basis, for the first nine months of 2019 was 4.36 percent, an 18 basis points increase from the net interest margin of 4.18 percent for the first nine months of 2018.  The increase in the margin was principally due to a shift in earning assets to higher yielding loans along with an increase in yields on the loan portfolio combined with relatively stable cost of funds and reduction in higher cost FHLB advances.

Non-interest IncomeNon-interest income of $102.4 million for the first nine months of 2019 increased $12.0 million, or 13 percent, over the same period last year which was driven by the sale of debt securities from the balance sheet strategy implemented during the current year.  Service charges and other fees of $53.2 million for 2019 year to date decreased $2.0 million, or 4 percent, from the same period prior year and although there was an increase in fees from increased number of deposit accounts from organic growth and acquisitions, the impact of the Durbin Amendment overshadowed such increases.  Gain on the sale of loans of $23.9 million for the first nine months of 2019, increased $2.4 million, or 11 percent, compared to the prior year as a result of increased purchase and refinance activity.  Other income decreased $1.7 million from the prior year and was the result of a gain of $2.3 million on the sale of a former branch building in the prior year third quarter.

Non-interest Expense Summary

	Nine Months ended
(Dollars in thousands)	Sep 30, 2019			Sep 30, 2018			$ Change				% Change
Compensation and employee benefits	$	167,210		$	144,671		$	22,539			16		%
Occupancy and equipment	25,348			22,850			2,498				11		%
Advertising and promotions	7,874			7,132			742				10		%
Data processing	12,420			11,960			460				4		%
Other real estate owned	496			2,957			(2,461		)		(83	)	%
Regulatory assessments and insurance	3,726			3,812			(86		)		(2	)	%
Core deposit intangibles amortization	5,919			4,539			1,380				30		%
Other expenses	56,682			40,330			16,352				41		%
Total non-interest expense	$	279,675		$	238,251		$	41,424			17		%

Total non-interest expense of $280 million for the first nine months of 2019 increased $41.4 million, or 17 percent, over the prior year same period.  Compensation and employee benefits for the first nine months of 2019 increased $22.5 million, or 16 percent, from the same period last year due to the $5.4 million of stock compensation expense related to the Heritage acquisition, the increased number of employees from acquisitions and organic growth, and annual salary increases. Occupancy and equipment expense for the first nine months of 2019 increased $2.5 million, or 11 percent from the prior year as a result of increased cost from acquisitions and general cost increases.  Other expenses of $56.7 million, increased $16.4 million, or 41 percent, from the prior year and was primarily driven by a $3.5 million write-off of prepayment penalties on FHLB borrowings and a $10.0 million loss recognized on the early termination of the interest rate swaps. 

Provision for Loan LossesThe provision for loan losses was $57 thousand for the first nine months of 2019, a decrease of $8.6 million from the same period in the prior year.  Net charge-offs during the first nine months of 2019 were $5.8 million compared to $5.7 million during the same period in 2018.

Federal and State Income Tax ExpenseTax expense of $36.4 million in the first nine months of 2019 increased $7.8 million, or 27 percent, over the prior year same period.  The effective tax rate year-to-date in 2019 was 19 percent compared to 18 percent in the prior year same period.

Efficiency RatioThe efficiency ratio was 58.82 percent for the first nine months of 2019.  Excluding the $10.0 million loss recognized on the termination of the interest rate swaps, the $3.5 million write-off of the deferred prepayment penalties on FHLB advances, and the $5.4 million of accelerated stock compensation expense, the efficiency ratio would have been 54.74 percent, which was a 27 basis points improvement from the efficiency ratio of 55.01 percent for the first nine months of 2018.

Forward-Looking StatementsThis 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 trade, monetary and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System or the Federal Reserve Board, which could adversely affect the Company’s net interest income and profitability;
• changes in the cost and scope of insurance from the Federal Deposit Insurance Corporation and other third parties;
• legislative or regulatory changes, including increased banking and consumer protection regulation that adversely affect the Company’s business, both generally and as a result of the Company exceeding $10 billion in total consolidated assets;
• ability to complete pending or prospective future acquisitions;
• 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 reputation of banks and the financial services industry could deteriorate, which could adversely affect the Company's ability to obtain and maintain customers;
• competition among financial institutions in the Company's markets may increase significantly;
• the risks presented by continued 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;
• the projected business and profitability of an expansion or the opening of a new branch could be lower than expected;
• 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 Glacier Bank divisions;
• material failure, potential interruption or breach in security of the Company’s systems and technological changes which could expose us to new risks (e.g., cybersecurity), fraud or system failures;
• natural disasters, including fires, floods, earthquakes, and other unexpected events;
• the Company’s success in managing risks involved in the foregoing; and
• the effects of any reputational damage to the Company resulting from any of 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.

Conference Call InformationA conference call for investors is scheduled for 11:00 a.m. Eastern Time on Friday, October 18, 2019. The conference call will be accessible by telephone and through the internet. Interested individuals are invited to listen to the call by dialing 877-561-2748 and conference ID 8397567. To participate on the webcast, log on to: https://edge.media-server.com/mmc/p/ysgi28yh. If you are unable to participate during the live webcast, the call will be archived on our website, www.glacierbancorp.com, or by calling 855-859-2056 with the ID 8397567 by November 1, 2019.

About Glacier Bancorp, Inc.Glacier Bancorp, Inc. is the parent company for Glacier Bank, Kalispell and its Bank divisions: Bank of the San Juans (Durango, CO), Citizens Community Bank (Pocatello, ID), Collegiate Peaks Bank (Buena Vista, CO), First Bank of Montana (Lewistown, MT), First Bank (Powell, WY), First Community Bank Utah (Layton, UT), First Security Bank of Bozeman (Bozeman, MT), First Security Bank of Missoula (Missoula, MT), First State Bank (Wheatland, WY), Heritage Bank of Nevada (Reno, NV), Mountain West Bank (Coeur d’Alene, ID), North Cascades Bank (Chelan, WA), The Foothills Bank (Yuma, AZ), Valley Bank of Helena (Helena, MT), and Western Security Bank (Billings, MT).

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

(Dollars in thousands, except per share data)	Sep 30, 2019				Jun 30, 2019			Dec 31, 2018			Sep 30, 2018
Assets
Cash on hand and in banks	$	233,623			181,526			161,782			171,394
Interest bearing cash deposits	172,761				49,683			42,008			135,710
Cash and cash equivalents	406,384				231,209			203,790			307,104
Debt securities, available-for-sale	2,459,036				2,470,634			2,571,663			2,103,619
Debt securities, held-to-maturity	234,992				252,097			297,915			590,915
Total debt securities	2,694,028				2,722,731			2,869,578			2,694,534
Loans held for sale, at fair value	100,441				54,711			33,156			50,649
Loans receivable	9,541,088				8,841,777			8,287,549			8,123,245
Allowance for loan and lease losses	(125,535		)		(129,054	)		(131,239	)		(132,535	)
Loans receivable, net	9,415,553				8,712,723			8,156,310			7,990,710
Premises and equipment, net	307,590				296,915			241,528			239,006
Other real estate owned	7,148				7,281			7,480			12,399
Accrued interest receivable	63,294				58,567			54,408			62,248
Deferred tax asset	—				3,371			23,564			37,264
Core deposit intangible, net	65,852				54,646			49,242			50,973
Goodwill	456,422				330,887			289,586			289,535
Non-marketable equity securities	10,427				23,031			27,871			16,502
Bank-owned life insurance	108,814				93,543			82,320			81,850
Other assets	82,839				86,746			76,651			76,328
Total assets	$	13,718,792			12,676,361			12,115,484			11,909,102
Liabilities
Non-interest bearing deposits	$	3,772,766			3,265,077			3,001,178			3,103,112
Interest bearing deposits	7,095,859				6,589,798			6,492,589			6,498,070
Securities sold under agreements to repurchase	558,752				494,651			396,151			408,754
FHLB advances	8,707				319,996			440,175			155,328
Other borrowed funds	14,808				14,765			14,708			9,944
Subordinated debentures	139,913				139,912			134,051			134,055
Accrued interest payable	4,435				5,091			4,252			4,065
Other liabilities	170,151				159,695			116,526			103,162
Total liabilities	11,765,391				10,988,985			10,599,630			10,416,490
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	922				866			845			845
Paid-in capital	1,375,785				1,139,289			1,051,253			1,050,463
Retained earnings - substantially restricted	528,599				503,773			473,183			471,021
Accumulated other comprehensive income (loss)	48,095				43,448			(9,427	)		(29,717	)
Total stockholders’ equity	1,953,401				1,687,376			1,515,854			1,492,612
Total liabilities and stockholders’ equity	$	13,718,792			12,676,361			12,115,484			11,909,102

Glacier Bancorp, Inc.Unaudited Condensed Consolidated Statements of Operations

	Three Months ended										Nine Months ended
(Dollars in thousands, except per share data)	Sep 30, 2019			Jun 30, 2019		Mar 31, 2019		Sep 30, 2018			Sep 30, 2019		Sep 30, 2018
Interest Income
Debt securities	$	21,357		21,892		21,351		21,971			64,600		64,483
Residential real estate loans	12,156			11,410		10,779		10,356			34,345		29,290
Commercial loans	97,224			88,043		83,539		80,587			268,806		221,926
Consumer and other loans	11,658			11,040		10,447		9,991			33,145		27,987
Total interest income	142,395			132,385		126,116		122,905			400,896		343,686
Interest Expense
Deposits	6,214			5,624		5,341		4,837			17,179		13,370
Securities sold under agreements to repurchase	999			886		802		570			2,687		1,541
Federal Home Loan Bank advances	2,035			3,847		3,055		2,132			8,937		6,734
Other borrowed funds	47			38		38		63			123		105
Subordinated debentures	1,652			1,694		1,668		1,558			5,014		4,345
Total interest expense	10,947			12,089		10,904		9,160			33,940		26,095
Net Interest Income	131,448			120,296		115,212		113,745			366,956		317,591
Provision for loan losses	—			—		57		3,194			57		8,707
Net interest income after provision for loan losses	131,448			120,296		115,155		110,551			366,899		308,884
Non-Interest Income
Service charges and other fees	15,138			20,025		18,015		19,504			53,178		55,179
Miscellaneous loan fees and charges	1,775			1,192		967		1,807			3,934		5,527
Gain on sale of loans	10,369			7,762		5,798		7,256			23,929		21,495
Gain (loss) on sale of debt securities	13,811			134		213		(367	)		14,158		(756	)
Other income	1,956			1,721		3,481		4,216			7,158		8,885
Total non-interest income	43,049			30,834		28,474		32,416			102,357		90,330
Non-Interest Expense
Compensation and employee benefits	62,509			51,973		52,728		49,927			167,210		144,671
Occupancy and equipment	8,731			8,180		8,437		7,914			25,348		22,850
Advertising and promotions	2,719			2,767		2,388		2,432			7,874		7,132
Data processing	4,466			4,062		3,892		3,752			12,420		11,960
Other real estate owned	166			191		139		2,674			496		2,957
Regulatory assessments and insurance	593			1,848		1,285		1,277			3,726		3,812
Core deposit intangibles amortization	2,360			1,865		1,694		1,735			5,919		4,539
Other expenses	29,131			15,284		12,267		13,118			56,682		40,330
Total non-interest expense	110,675			86,170		82,830		82,829			279,675		238,251
Income Before Income Taxes	63,822			64,960		60,799		60,138			189,581		160,963
Federal and state income tax expense	12,212			12,568		11,667		10,802			36,447		28,684
Net Income	$	51,610		52,392		49,132		49,336			153,134		132,279

Glacier Bancorp, Inc.Average Balance Sheets

	Three Months ended
	September 30, 2019									June 30, 2019
(Dollars in thousands)	Average Balance			Interest & Dividends			Average Yield/ Rate			Average Balance			Interest & Dividends			Average Yield/ Rate
Assets
Residential real estate loans	$	994,906		$	12,156		4.89	%		$	938,467		$	11,410		4.86	%
Commercial loans 1	7,378,337			98,465			5.29	%		6,803,541			89,191			5.26	%
Consumer and other loans	906,148			11,658			5.10	%		868,733			11,040			5.10	%
Total loans 2	9,279,391			122,279			5.23	%		8,610,741			111,641			5.20	%
Tax-exempt debt securities 3	899,914			9,280			4.13	%		957,177			9,982			4.17	%
Taxable debt securities 4	1,917,045			14,250			2.97	%		1,911,173			14,246			2.98	%
Total earning assets	12,096,350			145,809			4.78	%		11,479,091			135,869			4.75	%
Goodwill and intangibles	429,191									351,466
Non-earning assets	672,550									584,459
Total assets	$	13,198,091								$	12,415,016
Liabilities
Non-interest bearing deposits	$	3,513,908		$	—		—	%		$	3,084,404		$	—		—	%
NOW and DDA accounts	2,473,375			1,091			0.17	%		2,394,505			985			0.17	%
Savings accounts	1,445,323			270			0.07	%		1,389,548			253			0.07	%
Money market deposit accounts	1,845,184			1,540			0.33	%		1,662,545			1,125			0.27	%
Certificate accounts	929,441			2,412			1.03	%		902,134			2,222			0.99	%
Total core deposits	10,207,231			5,313			0.21	%		9,433,136			4,585			0.19	%
Wholesale deposits 5	146,339			901			2.44	%		162,495			1,039			2.56	%
FHLB advances	222,449			2,035			3.58	%		476,204			3,847			3.20	%
Repurchase agreements and  other borrowed funds	645,426			2,698			1.66	%		593,990			2,618			1.77	%
Total funding liabilities	11,221,445			10,947			0.39	%		10,665,825			12,089			0.45	%
Other liabilities	101,806									109,480
Total liabilities	11,323,251									10,775,305
Stockholders’ Equity
Common stock	903									860
Paid-in capital	1,292,182									1,110,138
Retained earnings	531,181									500,015
Accumulated other comprehensive income	50,574									28,698
Total stockholders’ equity	1,874,840									1,639,711
Total liabilities and stockholders’ equity	$	13,198,091								$	12,415,016
Net interest income (tax-equivalent)				$	134,862								$	123,780
Net interest spread (tax-equivalent)							4.39	%								4.30	%
Net interest margin (tax-equivalent)							4.42	%								4.33	%

______________________________1  Includes tax effect of $1.2 million and $1.1 million on tax-exempt municipal loan and lease income for the three months ended September 30, 2019 and June 30, 2019, respectively.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 $1.9 million and $2.0 million on tax-exempt debt securities income for the three months ended September 30, 2019 and June 30, 2019, respectively.4   Includes tax effect of $275 thousand and $294 thousand on federal income tax credits for the three months ended September 30, 2019 and June 30, 2019, respectively.5   Wholesale deposits include brokered deposits classified as NOW, DDA, money market deposit and certificate accounts.

Glacier Bancorp, Inc.Average Balance Sheets (continued)

	Three Months ended
	September 30, 2019									September 30, 2018
(Dollars in thousands)	Average Balance			Interest & Dividends			Average Yield/ Rate			Average Balance				Interest & Dividends			Average Yield/ Rate
Assets
Residential real estate loans	$	994,906		$	12,156		4.89	%		$	893,972			$	10,356		4.63	%
Commercial loans 1	7,378,337			98,465			5.29	%		6,361,742				81,636			5.09	%
Consumer and other loans	906,148			11,658			5.10	%		796,558				9,991			4.98	%
Total loans 2	9,279,391			122,279			5.23	%		8,052,272				101,983			5.02	%
Tax-exempt debt securities 3	899,914			9,280			4.13	%		1,074,266				12,389			4.61	%
Taxable debt securities 4	1,917,045			14,250			2.97	%		1,838,949				12,425			2.70	%
Total earning assets	12,096,350			145,809			4.78	%		10,965,487				126,797			4.59	%
Goodwill and intangibles	429,191									341,354
Non-earning assets	672,550									476,135
Total assets	$	13,198,091								$	11,782,976
Liabilities
Non-interest bearing deposits	$	3,513,908		$	—		—	%		$	2,988,562			$	—		—	%
NOW and DDA accounts	2,473,375			1,091			0.17	%		2,304,338				997			0.17	%
Savings accounts	1,445,323			270			0.07	%		1,340,003				219			0.06	%
Money market deposit accounts	1,845,184			1,540			0.33	%		1,720,845				881			0.20	%
Certificate accounts	929,441			2,412			1.03	%		942,417				1,728			0.73	%
Total core deposits	10,207,231			5,313			0.21	%		9,296,165				3,825			0.16	%
Wholesale deposits 5	146,339			901			2.44	%		166,009				1,012			2.42	%
FHLB advances	222,449			2,035			3.58	%		209,248				2,132			3.99	%
Repurchase agreements and  other borrowed funds	645,426			2,698			1.66	%		534,384				2,191			1.63	%
Total funding liabilities	11,221,445			10,947			0.39	%		10,205,806				9,160			0.36	%
Other liabilities	101,806									82,621
Total liabilities	11,323,251									10,288,427
Stockholders’ Equity
Common stock	903									845
Paid-in capital	1,292,182									1,050,081
Retained earnings	531,181									467,671
Accumulated other comprehensive  income (loss)	50,574									(24,048		)
Total stockholders’ equity	1,874,840									1,494,549
Total liabilities and stockholders’ equity	$	13,198,091								$	11,782,976
Net interest income (tax-equivalent)				$	134,862									$	117,637
Net interest spread (tax-equivalent)							4.39	%									4.23	%
Net interest margin (tax-equivalent)							4.42	%									4.26	%

______________________________1  Includes tax effect of $1.2 million and $1.0 million on tax-exempt municipal loan and lease income for the three months ended September 30, 2019 and 2018, respectively.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 $1.9 million and $2.5 million on tax-exempt debt securities income for the three months ended September 30, 2019 and 2018, respectively.4   Includes tax effect of $275 thousand and $304 thousand on federal income tax credits for the three months ended September 30, 2019 and 2018, respectively.5   Wholesale deposits include brokered deposits classified as NOW, DDA, money market deposit and certificate accounts.

Glacier Bancorp, Inc.Average Balance Sheets (continued)

	Nine Months ended
	September 30, 2019									September 30, 2018
(Dollars in thousands)	Average Balance			Interest & Dividends			Average Yield/ Rate			Average Balance				Interest & Dividends			Average Yield/ Rate
Assets
Residential real estate loans	$	950,516		$	34,345		4.82	%		$	851,280			$	29,290		4.59	%
Commercial loans 1	6,905,151			272,269			5.27	%		6,026,787				224,944			4.99	%
Consumer and other loans	871,544			33,145			5.08	%		759,437				27,987			4.93	%
Total loans 2	8,727,211			339,759			5.21	%		7,637,504				282,221			4.94	%
Tax-exempt debt securities 3	938,998			29,212			4.15	%		1,084,436				37,818			4.65	%
Taxable debt securities 4	1,891,560			42,225			2.98	%		1,809,047				35,327			2.60	%
Total earning assets	11,557,769			411,196			4.76	%		10,530,987				355,366			4.51	%
Goodwill and intangibles	373,207									301,786
Non-earning assets	593,011									447,226
Total assets	$	12,523,987								$	11,279,999
Liabilities
Non-interest bearing deposits	$	3,182,783		$	—		—	%		$	2,755,702			$	—		—	%
NOW and DDA accounts	2,396,828			3,037			0.17	%		2,211,982				2,824			0.17	%
Savings accounts	1,398,539			757			0.07	%		1,282,161				642			0.07	%
Money market deposit accounts	1,733,245			3,675			0.28	%		1,700,216				2,457			0.19	%
Certificate accounts	912,283			6,648			0.97	%		920,222				4,639			0.67	%
Total core deposits	9,623,678			14,117			0.20	%		8,870,283				10,562			0.16	%
Wholesale deposits 5	159,314			3,062			2.57	%		156,298				2,808			2.40	%
FHLB advances	349,998			8,937			3.37	%		241,438				6,734			3.68	%
Repurchase agreements and  other borrowed funds	598,907			7,824			1.75	%		522,267				5,991			1.53	%
Total funding liabilities	10,731,897			33,940			0.42	%		9,790,286				26,095			0.36	%
Other liabilities	109,090									61,272
Total liabilities	10,840,987									9,851,558
Stockholders’ Equity
Common stock	870									833
Paid-in capital	1,152,076									1,002,321
Retained earnings	501,158									444,116
Accumulated other comprehensive  income (loss)	28,896									(18,829		)
Total stockholders’ equity	1,683,000									1,428,441
Total liabilities and stockholders’ equity	$	12,523,987								$	11,279,999
Net interest income (tax-equivalent)				$	377,256									$	329,271
Net interest spread (tax-equivalent)							4.34	%									4.15	%
Net interest margin (tax-equivalent)							4.36	%									4.18	%

______________________________1  Includes tax effect of $3.5 million and $3.0 million on tax-exempt municipal loan and lease income for the nine months ended September 30, 2019 and 2018, respectively.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 $6.0 million and $7.7 million on tax-exempt investment securities income for the nine months ended September 30, 2019 and 2018, respectively.4   Includes tax effect of $863 thousand and $913 thousand on federal income tax credits for the nine months ended September 30, 2019 and 2018, respectively.5   Wholesale deposits include brokered deposits classified as NOW, DDA, money market deposit and certificate accounts.

Glacier Bancorp, Inc.Loan Portfolio by Regulatory Classification

	Loans Receivable, by Loan Type																% Change from
(Dollars in thousands)	Sep 30, 2019				Jun 30, 2019				Dec 31, 2018				Sep 30, 2018				Jun 30, 2019				Dec 31, 2018				Sep 30, 2018
Custom and owner occupied construction	$	147,626			$	140,186			$	126,595			$	123,369			5		%		17		%		20		%
Pre-sold and spec construction	207,596				171,464				121,938				109,214				21		%		70		%		90		%
Total residential construction	355,222				311,650				248,533				232,583				14		%		43		%		53		%
Land development	103,090				120,052				137,814				125,272				(14	)	%		(25	)	%		(18	)	%
Consumer land or lots	128,668				128,544				127,775				123,979				—		%		1		%		4		%
Unimproved land	71,467				74,244				83,579				75,183				(4	)	%		(14	)	%		(5	)	%
Developed lots for operative builders	13,782				14,117				17,061				14,922				(2	)	%		(19	)	%		(8	)	%
Commercial lots	64,904				57,447				34,096				30,255				13		%		90		%		115		%
Other construction	443,947				453,782				520,005				487,428				(2	)	%		(15	)	%		(9	)	%
Total land, lot, and other construction	825,858				848,186				920,330				857,039				(3	)	%		(10	)	%		(4	)	%
Owner occupied	1,666,211				1,418,190				1,343,563				1,330,024				17		%		24		%		25		%
Non-owner occupied	2,023,262				1,780,988				1,605,960				1,564,182				14		%		26		%		29		%
Total commercial real estate	3,689,473				3,199,178				2,949,523				2,894,206				15		%		25		%		27		%
Commercial and industrial	1,009,310				1,024,828				907,340				884,414				(2	)	%		11		%		14		%
Agriculture	718,255				697,893				646,822				672,916				3		%		11		%		7		%
1st lien	1,208,096				1,154,221				1,108,227				1,109,308				5		%		9		%		9		%
Junior lien	53,931				53,055				56,689				59,345				2		%		(5	)	%		(9	)	%
Total 1-4 family	1,262,027				1,207,276				1,164,916				1,168,653				5		%		8		%		8		%
Multifamily residential	350,622				278,539				247,457				222,647				26		%		42		%		57		%
Home equity lines of credit	612,775				592,355				539,938				521,778				3		%		13		%		17		%
Other consumer	171,633				167,964				165,865				166,788				2		%		3		%		3		%
Total consumer	784,408				760,319				705,803				688,566				3		%		11		%		14		%
States and political subdivisions	471,599				454,085				404,671				429,409				4		%		17		%		10		%
Other	174,755				114,534				125,310				123,461				53		%		39		%		42		%
Total loans receivable, including  loans held for sale	9,641,529				8,896,488				8,320,705				8,173,894				8		%		16		%		18		%
Less loans held for sale 1	(100,441		)		(54,711		)		(33,156		)		(50,649		)		84		%		203		%		98		%
Total loans receivable	$	9,541,088			$	8,841,777			$	8,287,549			$	8,123,245			8		%		15		%		17		%

______________________________1 Loans held for sale are primarily 1st lien 1-4 family loans.

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, 2019			Jun 30, 2019		Dec 31, 2018		Sep 30, 2018		Sep 30, 2019		Sep 30, 2019		Sep 30, 2019
Custom and owner occupied construction	$	283		283		—		1,599		283		—		—
Pre-sold and spec construction	1,219			1,261		463		474		1,219		—		—
Total residential construction	1,502			1,544		463		2,073		1,502		—		—
Land development	1,006			1,272		2,166		5,147		494		—		512
Consumer land or lots	828			1,075		1,428		1,592		368		—		460
Unimproved land	8,781			8,864		9,338		9,815		6,998		486		1,297
Developed lots for operative builders	—			—		68		68		—		—		—
Commercial lots	575			575		1,046		1,046		—		—		575
Other construction	—			241		120		147		—		—		—
Total land, lot and other construction	11,190			12,027		14,166		17,815		7,860		486		2,844
Owner occupied	8,251			6,998		5,940		11,246		6,141		538		1,572
Non-owner occupied	9,271			7,198		10,567		10,847		6,099		3,172		—
Total commercial real estate	17,522			14,196		16,507		22,093		12,240		3,710		1,572
Commercial and industrial	6,135			5,690		3,914		5,615		5,749		172		214
Agriculture	3,469			4,228		7,040		7,856		2,612		707		150
1st lien	9,420			10,211		10,290		9,543		6,104		1,665		1,651
Junior lien	669			592		565		2,610		597		—		72
Total 1-4 family	10,089			10,803		10,855		12,153		6,701		1,665		1,723
Multifamily residential	206			—		—		613		206		—		—
Home equity lines of credit	3,553			2,474		2,770		3,470		2,435		549		569
Other consumer	1,098			597		456		417		412		610		76
Total consumer	4,651			3,071		3,226		3,887		2,847		1,159		645
Other	313			380		579		—		300		13		—
Total	$	55,077		51,939		56,750		72,105		40,017		7,912		7,148

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, 2019			Jun 30, 2019			Dec 31, 2018			Sep 30, 2018			Jun 30, 2019				Dec 31, 2018				Sep 30, 2018
Custom and owner occupied construction	$	49		$	49		$	1,661		$	4,502		—		%		(97	)	%		(99	)	%
Pre-sold and spec construction	8			219			887			494			(96	)	%		(99	)	%		(98	)	%
Total residential construction	57			268			2,548			4,996			(79	)	%		(98	)	%		(99	)	%
Land development	1,282			1,990			228			516			(36	)	%		462		%		148		%
Consumer land or lots	836			206			200			235			306		%		318		%		256		%
Unimproved land	8			658			579			629			(99	)	%		(99	)	%		(99	)	%
Developed lots for operative builders	—			—			122			—			n/m				(100	)	%		n/m
Commercial lots	—			—			203			—			n/m				(100	)	%		n/m
Other construction	142			—			4,170			—			n/m				(97	)	%		n/m
Total land, lot and other construction	2,268			2,854			5,502			1,380			(21	)	%		(59	)	%		64		%
Owner occupied	2,949			5,322			2,981			2,872			(45	)	%		(1	)	%		3		%
Non-owner occupied	1,286			11,700			1,245			1,131			(89	)	%		3		%		14		%
Total commercial real estate	4,235			17,022			4,226			4,003			(75	)	%		—		%		6		%
Commercial and industrial	12,780			3,006			3,374			4,791			325		%		279		%		167		%
Agriculture	1,290			3,125			6,455			1,332			(59	)	%		(80	)	%		(3	)	%
1st lien	2,521			2,776			5,384			3,795			(9	)	%		(53	)	%		(34	)	%
Junior lien	715			1,302			118			420			(45	)	%		506		%		70		%
Total 1-4 family	3,236			4,078			5,502			4,215			(21	)	%		(41	)	%		(23	)	%
Multifamily Residential	149			1,598			—			—			(91	)	%		n/m				n/m
Home equity lines of credit	4,162			3,931			3,562			2,467			6		%		17		%		69		%
Other consumer	1,388			1,683			1,650			1,903			(18	)	%		(16	)	%		(27	)	%
Total consumer	5,550			5,614			5,212			4,370			(1	)	%		6		%		27		%
States and political subdivisions	—			—			229			—			n/m				(100	)	%		n/m
Other	389			372			519			94			5		%		(25	)	%		314		%
Total	$	29,954		$	37,937		$	33,567		$	25,181		(21	)	%		(11	)	%		19		%

______________________________n/m - not measurable

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, 2019				Jun 30, 2019			Dec 31, 2018			Sep 30, 2018			Sep 30, 2019		Sep 30, 2019
Pre-sold and spec construction	$	(12	)		(6	)		(352	)		(348	)		—		12
Land development	(25		)		15			(116	)		(110	)		42		67
Consumer land or lots	(160		)		(2	)		(146	)		(121	)		37		197
Unimproved land	(271		)		(54	)		(445	)		(288	)		—		271
Developed lots for operative builders	(18		)		(18	)		33			33			—		18
Commercial lots	(4		)		(3	)		1			3			—		4
Other construction	(142		)		(32	)		(19	)		(4	)		9		151
Total land, lot and other construction	(620		)		(94	)		(692	)		(487	)		88		708
Owner occupied	(35		)		139			1,320			902			226		261
Non-owner occupied	1,861				7			853			(6	)		1,988		127
Total commercial real estate	1,826				146			2,173			896			2,214		388
Commercial and industrial	1,066				37			2,449			1,893			1,797		731
Agriculture	(32		)		(32	)		16			39			67		99
1st lien	189				56			577			8			439		250
Junior lien	(254		)		(222	)		(371	)		486			44		298
Total 1-4 family	(65		)		(166	)		206			494			483		548
Multifamily residential	—				—			(649	)		(6	)		—		—
Home equity lines of credit	(25		)		(11	)		(97	)		(39	)		13		38
Other consumer	380				313			261			161			606		226
Total consumer	355				302			164			122			619		264
Other	3,243				2,055			4,967			3,137			6,822		3,579
Total	$	5,761			2,242			8,282			5,740			12,090		6,329

Visit our website at www.glacierbancorp.com

CONTACT: Randall M. Chesler, CEO

(406) 751-4722

Ron J. Copher, CFO

(406) 751-7706

 

Source: Glacier Bancorp, Inc.