Diluted earnings per share up six percent, to 38 cents, from third quarter 2016 Excluding merger-related and other non-operating charges, diluted operating EPS up five percent, to 41 cents
  • Net interest revenue of $89.8 million, up $10.8 million or 14 percent from year ago
  • Net interest margin of 3.54 percent, up seven basis points from second quarter and up 20 basis points from year ago
  • Return on assets of 1.01 percent, or 1.09 percent excluding merger-related and other charges
  • Efficiency ratio of 59.3 percent, or 56.2 percent excluding merger-related and other charges
  • Completed the acquisition of Horry County State Bank during the quarter

BLAIRSVILLE, Ga., Oct. 24, 2017 (GLOBE NEWSWIRE) -- United Community Banks, Inc. (NASDAQ:UCBI) ("United") today announced strong third quarter results with meaningful margin expansion, disciplined expense management and sound credit quality.  Net income was $27.9 million, or 38 cents per diluted share, compared with $25.9 million, or 36 cents per diluted share, for the third quarter of 2016.

On an operating basis, net income rose to $30.2 million for the third quarter of 2017 compared with $27.8 million for the third quarter of 2016.  Third quarter 2017 operating net income excludes merger-related and other non-operating charges totaling $2.27 million, net of the associated income tax benefit.  Third quarter 2016 operating net income excludes $1.96 million in merger-related charges, net of the associated income tax benefit.  On a per diluted share basis, operating net income was 41 cents for the third quarter of 2017 compared with 39 cents for the third quarter of 2016.

At September 30, 2017, preliminary regulatory capital ratios were as follows. Tier 1 Risk-Based of 12.3 percent; Total Risk-Based of 13.0 percent; Common Equity Tier 1 Risk-Based of 12.2 percent, and Tier 1 Leverage of 9.3 percent.

"Our third quarter results demonstrate United bankers' ability to overcome challenges and produce solid financial results," said Jimmy Tallent, chairman and chief executive officer.  "In the third quarter, we became subject to the Durbin amendment of the Dodd Frank Wall Street Reform and Consumer Protection Act which places a cap on the amount banks can charge merchants for debit card interchange fees.  We also became subject to the large bank deposit insurance assessment model.  The combined effect of these two items reduced our pre-tax earnings by approximately $3.4 million, or three cents per share, in the third quarter.  We had been actively preparing for this for two years and our bankers were able to completely offset the impact through a higher net interest margin and disciplined expense controls.

"Despite these challenges and excluding merger-related and other non-operating charges, our third quarter operating efficiency ratio held steady at 56.2 percent, our best in more than a decade," Tallent stated.  "Including merger and other non-operating charges, the efficiency ratio was 59.3 percent.  Clearly our bankers delivered solid financial performance by every measure."

Tallent continued, "We also completed the acquisition of Horry County State Bank on July 31 st, significantly enhancing our presence in the Myrtle Beach area along the South Carolina coast.  The acquisition of Horry County State Bank, which is part of our larger, ongoing expansion strategy in the high-growth South Carolina coast will accelerate our growth in this attractive market.  We are all set for systems conversions in mid-November at which time we expect to achieve all of our cost savings.

"We are scheduled to complete our acquisition of Four Oaks Bank & Trust Company on November 1 st which will extend our footprint farther east in North Carolina to the fast-growing Raleigh MSA.  All regulatory and shareholder approvals for the transaction have been received.  We have long sought to enter this market and are delighted to find an exceptional partner in Four Oaks.  I could not be more pleased with these two partnerships and look forward to them becoming part of United.

"Third quarter loan production was $617 million with $434 million originating from our community banks and $183 million from our Commercial Banking Solutions group," Tallent added.  "Linked-quarter loans were up $162 million, mostly reflecting the $216 million in net loans received through our acquisition of Horry County State Bank.  Our indirect auto loan portfolio was down $48.7 million from second quarter reflecting our decision to suspend indirect auto loan purchases.  Excluding the reduction in indirect auto loans and the loans acquired through the Horry acquisition, loan growth was essentially flat from second quarter."

Third quarter net interest revenue totaled $89.8 million, up $10.8 million from the third quarter of 2016 and up $4.6 million from the second quarter.  The increases from both periods reflect business growth and net interest margin expansions of 20 basis points from a year ago and seven basis points from the second quarter, mostly driven by rising short-term interest rates as well as the acquisition of Horry County State Bank which was completed on July 31, 2017.  Horry County State Bank results are included in United's financial results from the acquisition date.

The third quarter provision for credit losses was $1 million, up from $800,000 for the second quarter.  This compares with a provision recovery of $300,000 in the third quarter of 2016.  Third quarter net charge-offs totaled $1.6 million, equal to the second quarter of 2017 but up slightly from $1.4 million in the third quarter of 2016.  Contributing to the low level of net charge-offs were continued strong recoveries of previously charged-off loans.  Nonperforming assets were .23 percent of total assets at September 30, 2017, compared with .30 percent at September 30, 2016 and .24 percent at June 30, 2017.

"We continue to experience strong, steady credit quality and a low level of net charge-offs which is reflected in our low provision for loan losses," Tallent commented.  "Our credit quality indicators show no indication of credit deterioration and our outlook is for that to continue.  We also expect our provision levels to gradually increase during the year due to loan growth, while our allowance and the related ratio to total loans will decline slightly."

Third quarter fee revenue totaled $20.6 million, down $5.79 million from a year ago and down $3.11 million from the second quarter.  The decrease from both prior periods was mostly due to lower debit card interchange fees as a result of the Durbin amendment becoming effective for United on July 1 st.  The Durbin amendment, which places a cap on the amount of interchange banks can charge merchants for use of their debit cards, reduced United's debit card interchange fees by approximately $2.7 million in the third quarter.  Also contributing to the decrease from both prior periods were lower mortgage fees and lower customer derivative fees reflecting a less favorable interest rate environment.

Operating expenses were $65.7 million for the third quarter, compared with $64.0 million for the third quarter of 2016 and $63.2 million for the second quarter.  Included in the third quarter's operating expenses are $2.3 million in merger-related expenses and $1.1 million in surplus property impairment charges, totaling $3.4 million.  We also had merger-related charges of $3.15 million in the third quarter of 2016, and merger-related and executive retirement charges totaling $1.83 million in the second quarter of 2017.  Excluding these charges, third quarter operating expenses were $62.3 million compared with $61.4 million for the second quarter and $60.9 million a year ago.  The $855,000 increase from the second quarter was mostly due to higher deposit insurance costs as a result of being assessed under the large bank deposit insurance assessment model effective July 1, and the operating expenses of Horry County State Bank acquired on July 31.  These increases were partially offset by lower communications and equipment and advertising and public relations expense.

Tallent concluded, "Our bankers always meet every challenge with diligence and perseverance.  That was certainly demonstrated with our third quarter financial results.  Their passion and commitment drive our performance and ensure our success.  Every day I become more encouraged about the opportunities that lie ahead knowing that our exceptional team of bankers will find success in everything they do.  With Horry County State Bank and Four Oaks Bank & Trust Company, we have found two outstanding strategic partners in key growth markets that share our passion for banking and our commitment to customer service.  I am excited about the opportunities that these acquisitions create to recruit other talented bankers from within these markets into the United family."

Conference CallUnited will hold a conference call today, Wednesday, October 25, 2017, at 11 a.m. ET to discuss the contents of this earnings release and to share business highlights for the quarter. To access the call, dial (877) 380-5665 and use the conference number 90798221.  The conference call also will be webcast and available for replay for 30 days by selecting "Events & Presentations" within the Investor Relations section of United's website at www.ucbi.com.

About United Community Banks, Inc.United Community Banks, Inc. (NASDAQ:UCBI) is a bank holding company based in Blairsville, Georgia with $11.1 billion in assets.  The company's banking subsidiary, United Community Bank, is one of the southeast region's largest full-service banks, operating 142 offices in Georgia, North Carolina, South Carolina and Tennessee.  The bank specializes in personalized community banking services for individuals, small businesses and corporations.  Services include a full range of consumer and commercial banking products including mortgage, advisory, and treasury management.  Respected national research firms consistently recognize United Community Bank for outstanding customer service.  For the last four years, J.D. Power has ranked United Community Bank first in customer satisfaction in the Southeast.  In 2017, for the fourth consecutive year, Forbes magazine included United on its list of the 100 Best Banks in America.  Additional information about the company and the bank's full range of products and services can be found at www.ucbi.com.

Non-GAAP Financial MeasuresThis News Release, including the accompanying financial statement tables, contains financial information determined by methods other than in accordance with generally accepted accounting principles, or GAAP.  This financial information includes certain operating performance measures, which exclude merger-related and other charges that are not considered part of recurring operations, such as "operating net income," "operating net income per diluted share," "operating net income available to common shareholders," "operating diluted income per common share," "tangible book value per common share," "operating return on common equity," "operating return on tangible common equity," "operating return on assets," "operating dividend payout ratio," "operating efficiency ratio," "average tangible equity to average assets," "average tangible common equity to average assets" and "tangible common equity to risk-weighted assets."  These non-GAAP measures are included because United believes they may provide useful supplemental information for evaluating United's underlying performance trends.  These measures should be viewed in addition to, and not as an alternative to or substitute for, measures determined in accordance with GAAP, and are not necessarily comparable to non-GAAP measures that may be presented by other companies.  To the extent applicable, reconciliations of these non-GAAP measures to the most directly comparable measures as reported in accordance with GAAP are included with the accompanying financial statement tables.

Safe HarborThis News Release contains forward-looking statements, as defined by federal securities laws, including statements about United's financial outlook and business environment.  These statements are based on current expectations and are provided to assist in the understanding of future financial performance.  Such performance involves risks and uncertainties that may cause actual results to differ materially from those expressed or implied in any such statements.  For a discussion of some of the risks and other factors that may cause such forward-looking statements to differ materially from actual results, please refer to United's filings with the Securities and Exchange Commission, including our 2016 Annual Report on Form 10-K under the sections entitled "Forward-Looking Statements" and "Risk Factors."  Forward-looking statements speak only as of the date they are made, and we undertake no obligation to update or revise forward-looking statements.

 
UNITED COMMUNITY BANKS, INC.                          
Financial Highlights                          
Selected Financial Information                          
                           
                      Third  
    2017      2016    Quarter  
    Third       Second       First       Fourth       Third     2017-2016  
(in thousands, except per share data) Quarter   Quarter   Quarter   Quarter   Quarter     Change  
INCOME SUMMARY                          
Interest revenue $   98,839     $   93,166     $   90,958     $   87,778     $   85,439          
Interest expense     9,064         8,018         7,404         6,853         6,450          
  Net interest revenue     89,775         85,148         83,554         80,925         78,989       14   %  
Provision for credit losses     1,000         800         800         -          (300 )        
Fee revenue     20,573         23,685         22,074         25,233         26,361       (22 )    
  Total revenue     109,348         108,033         104,828         106,158         105,650       4      
Expenses     65,674         63,229         62,826         61,321         64,023       3      
Income before income tax expense     43,674         44,804         42,002         44,837         41,627       5      
Income tax expense     15,728         16,537         18,478         17,616         15,753       -      
Net income     27,946         28,267         23,524         27,221         25,874       8      
Merger-related and other charges     3,420         1,830         2,054         1,141         3,152          
Income tax benefit of merger-related and other charges     (1,147 )       (675 )       (758 )       (432 )       (1,193 )        
Impairment of deferred tax asset on canceled   non-qualified stock options     -          -          -          976         -           
Release of disproportionate tax effects lodged in OCI     -          -          3,400         -          -           
  Net income - operating (1) $     30,219     $     29,422     $     28,220     $     28,906     $     27,833       9      
                           
PERFORMANCE MEASURES                          
  Per common share:                          
  Diluted net income - GAAP  $ .38      $ .39      $  .33      $ .38      $   .36       6      
  Diluted net income - operating  (1)   .41       .41       .39       .40       .39       5      
  Cash dividends declared   .10       .09       .09       .08       .08          
  Book value     16.50         15.83         15.40         15.06         15.12       9      
  Tangible book value (3)     14.11         13.74         13.30         12.95         13.00       9      
                           
  Key performance ratios:                          
  Return on common equity - GAAP (2)(4)     9.22   %     9.98   %     8.54   %     9.89   %     9.61   %    
  Return on common equity - operating (1)(2)(4)     9.97         10.39         10.25         10.51         10.34          
  Return on tangible common equity - operating (1)(2)(3)(4)     11.93         12.19         12.10         12.47         12.45          
  Return on assets - GAAP (4)     1.01         1.06       .89         1.03         1.00          
  Return on assets - operating (1)(4)     1.09         1.10         1.07         1.10         1.08          
  Dividend payout ratio - GAAP     26.32         23.08         27.27         21.05         22.22          
  Dividend payout ratio - operating (1)     24.39         21.95         23.08         20.00         20.51          
  Net interest margin (fully taxable equivalent) (4)     3.54         3.47         3.45         3.34         3.34          
  Efficiency ratio - GAAP     59.27         57.89         59.29         57.65         60.78          
  Efficiency ratio - operating  (1)     56.18         56.21         57.35         56.58         57.79          
  Average equity to average assets     10.86         10.49       10.24       10.35       10.38          
  Average tangible equity to average assets (3)     9.45         9.23       8.96       9.04       8.98          
  Average tangible common equity to average assets (3)     9.45         9.23       8.96       9.04       8.98          
  Tangible common equity to risk-weighted assets (3)(5)     12.81         12.44         12.07         11.84         12.22          
                           
ASSET QUALITY                          
  Nonperforming loans $   22,921     $   23,095     $   19,812     $   21,539     $   21,572       6      
  Foreclosed properties     2,736         2,739         5,060         7,949         9,187       (70 )    
  Total nonperforming assets (NPAs)     25,657         25,834         24,872         29,488         30,759       (17 )    
  Allowance for loan losses     58,605         59,500         60,543         61,422         62,961       (7 )    
  Net charge-offs     1,635         1,623         1,679         1,539         1,359       20      
  Allowance for loan losses to loans   .81   %   .85   %   .87   %     .89    %    .94    %       
  Net charge-offs to average loans (4)   .09       .09       .10       .09       .08          
  NPAs to loans and foreclosed properties   .36       .37       .36       .43       .46          
  NPAs to total assets   .23       .24       .23       .28       .30          
                           
AVERAGE BALANCES ($ in millions)                          
  Loans $   7,149     $   6,980     $   6,904     $   6,814     $   6,675       7      
  Investment securities     2,800         2,775         2,822         2,690         2,610       7      
  Earning assets     10,133         9,899         9,872         9,665         9,443       7      
  Total assets     10,980         10,704         10,677         10,484         10,281       7      
  Deposits     8,913         8,659         8,592         8,552         8,307       7      
  Shareholders' equity     1,193         1,123         1,093         1,085         1,067       12      
  Common shares - basic (thousands)     73,151         71,810         71,700         71,641         71,556       2      
  Common shares - diluted (thousands)     73,162         71,820         71,708         71,648         71,561       2      
                           
AT PERIOD END ($ in millions)                          
  Loans $   7,203     $   7,041     $   6,965     $   6,921     $   6,725       7      
  Investment securities     2,847         2,787         2,767         2,762         2,560       11      
  Total assets     11,129         10,837         10,732         10,709         10,298       8      
  Deposits     9,127         8,736         8,752         8,638         8,442       8      
  Shareholders' equity     1,221         1,133         1,102         1,076         1,079       13      
  Common shares outstanding (thousands)     73,403         70,981         70,973         70,899         70,861       4      
                           
(1)  Excludes merger-related and other charges which includes amortization of certain executive change of control benefits, a first quarter 2017 release of disproportionate tax effects lodged in OCI and a fourth quarter 2016 deferred tax asset impairment charge related to cancelled non-qualified stock options.  (2)  Net income available to common shareholders, which is net of preferred stock dividends, divided by average realized common equity, which excludes accumulated other comprehensive income (loss).  (3)  Excludes effect of acquisition related intangibles and associated amortization.  (4)  Annualized.  (5)  Third quarter 2017 ratio is preliminary.  
                           

 
UNITED COMMUNITY BANKS, INC.              
Financial Highlights              
Selected Financial Information              
               
  For the Nine      
  Months Ended   YTD  
  September 30,   2017-2016  
(in thousands, except per share data)   2017       2016       Change  
INCOME SUMMARY              
Interest revenue $   282,963     $   247,242          
Interest expense     24,486         18,383          
  Net interest revenue     258,477         228,859       13   %  
Provision for credit losses     2,600         (800 )        
Fee revenue     66,332         68,464       (3 )    
  Total revenue     322,209         298,123       8      
Expenses     191,729         179,968       7      
Income before income tax expense     130,480         118,155       10      
Income tax expense     50,743         44,720       13      
Net income     79,737         73,435       9      
Merger-related and other charges     7,304         6,981          
Income tax benefit of merger-related and other charges     (2,580 )       (2,642 )        
Impairment of deferred tax asset on canceled   non-qualified stock options     -          -           
Release of disproportionate tax effects lodged in OCI     3,400         -           
  Net income - operating (1) $     87,861     $     77,774       13      
               
PERFORMANCE MEASURES              
  Per common share:              
  Diluted net income - GAAP $   1.10     $   1.02       8      
  Diluted net income - operating  (1)     1.21         1.08       12      
  Cash dividends declared   .28       .22          
  Book value     16.50         15.12       9      
  Tangible book value (3)     14.11         13.00       9      
               
  Key performance ratios:              
  Return on common equity - GAAP (2)(4)     9.26   %     9.25   %    
  Return on common equity - operating (1)(2)(4)     10.20         9.79          
  Return on tangible common equity - operating (1)(2)(3)(4)     12.07         11.64          
  Return on assets - GAAP (4)     .99       .99          
  Return on assets - operating (1)(4)     1.09         1.05          
  Dividend payout ratio - GAAP     25.45         21.57          
  Dividend payout ratio - operating (1)     23.14         20.37          
  Net interest margin (fully taxable equivalent) (4)     3.49         3.36          
  Efficiency ratio - GAAP     58.81         60.56          
  Efficiency ratio - operating  (1)     56.57         58.21          
  Average equity to average assets     10.54       10.60          
  Average tangible equity to average assets (3)     9.21       9.27          
  Average tangible common equity to average assets (3)     9.21       9.24          
  Tangible common equity to risk-weighted assets (3)(5)     12.81       12.22          
               
ASSET QUALITY              
  Nonperforming loans $   22,921     $   21,572       6      
  Foreclosed properties     2,736         9,187       (70 )    
  Total nonperforming assets (NPAs)     25,657         30,759       (17 )    
  Allowance for loan losses     58,605         62,961       (7 )    
  Net charge-offs     4,937         5,227       (6 )    
  Allowance for loan losses to loans     .81     .94        
  Net charge-offs to average loans (4)   .09       .11          
  NPAs to loans and foreclosed properties   .36       .46          
  NPAs to total assets   .23       .30          
               
AVERAGE BALANCES ($ in millions)              
  Loans $   7,012     $   6,278       12      
  Investment securities     2,799         2,692       4      
  Earning assets     9,969         9,120       9      
  Total assets     10,788         9,909       9      
  Deposits     8,723         8,051       8      
  Shareholders' equity     1,137         1,051       8      
  Common shares - basic (thousands)     72,060         71,992       -       
  Common shares - diluted (thousands)     72,071         71,996       -       
               
AT PERIOD END ($ in millions)              
  Loans $   7,203     $   6,725       7      
  Investment securities     2,847         2,560       11      
  Total assets     11,129         10,298       8      
  Deposits     9,127         8,442       8      
  Shareholders' equity     1,221         1,079       13      
  Common shares outstanding (thousands)     73,403         70,861       4      
               
(1)  Excludes merger-related and other charges which includes amortization of certain executive change of control benefits, a first quarter 2017 release of disproportionate tax effects lodged in OCI and a fourth quarter 2016 deferred tax asset impairment charge related to cancelled non-qualified stock options.  (2)  Net income available to common shareholders, which is net of preferred stock dividends, divided by average realized common equity, which excludes accumulated other comprehensive income (loss).  (3)  Excludes effect of acquisition related intangibles and associated amortization.  (4)  Annualized.  (5)  Third quarter 2017 ratio is preliminary.  
               

 
UNITED COMMUNITY BANKS, INC.                      
Non-GAAP Performance Measures Reconciliation                      
Selected Financial Information                      
                       
                       
    2017       2016  
    Third       Second       First       Fourth       Third      
(in thousands, except per share data) Quarter   Quarter   Quarter   Quarter   Quarter    
                       
Expense reconciliation                      
Expenses (GAAP) $   65,674     $   63,229     $   62,826     $   61,321     $   64,023      
Merger-related and other charges     (3,420 )       (1,830 )       (2,054 )       (1,141 )       (3,152 )    
  Expenses - operating $   62,254     $   61,399     $   60,772     $   60,180     $   60,871      
                       
Net income reconciliation                      
Net income (GAAP) $   27,946     $   28,267     $   23,524     $   27,221     $   25,874      
Merger-related and other charges     3,420         1,830         2,054         1,141         3,152      
Income tax benefit of merger-related and other charges     (1,147 )       (675 )       (758 )       (432 )       (1,193 )    
Impairment of deferred tax asset on canceled non-qualified stock options     -          -          -          976         -       
Release of disproportionate tax effects lodged in OCI     -          -          3,400         -          -       
  Net income - operating $   30,219     $   29,422     $   28,220     $   28,906     $   27,833      
                       
Diluted income per common share reconciliation                      
Diluted income per common share (GAAP)  $ .38      $   .39      $   .33      $   .38      $   .36       
Merger-related and other charges   .03       .02       .01       .01       .03      
Impairment of deferred tax asset on canceled non-qualified stock options           -          -        .01         -       
Release of disproportionate tax effects lodged in OCI           -        .05         -          -       
  Diluted income per common share - operating  $   .41      $   .41      $   .39      $   .40      $   .39      
                       
Book value per common share reconciliation                      
Book value per common share (GAAP) $   16.50     $   15.83     $   15.40     $   15.06     $   15.12      
Effect of goodwill and other intangibles     (2.39 )       (2.09 )       (2.10 )       (2.11 )       (2.12 )    
  Tangible book value per common share $   14.11     $   13.74     $   13.30     $   12.95     $   13.00      
                       
Return on tangible common equity reconciliation                      
Return on common equity (GAAP)     9.22   %     9.98   %     8.54   %     9.89   %     9.61   %  
Merger-related and other charges   .75       .41       .47       .26       .73      
Impairment of deferred tax asset on canceled non-qualified stock options     -          -          -        .36         -       
Release of disproportionate tax effects lodged in OCI     -          -          1.24         -          -       
Return on common equity - operating     9.97         10.39         10.25         10.51         10.34      
Effect of goodwill and other intangibles     1.96         1.80         1.85         1.96         2.11      
  Return on tangible common equity - operating     11.93   %     12.19   %     12.10   %     12.47   %     12.45   %  
                       
Return on assets reconciliation                      
Return on assets (GAAP)     1.01   %     1.06   %   .89   %     1.03   %     1.00   %  
Merger-related and other charges   .08       .04       .05       .03       .08      
Impairment of deferred tax asset on canceled non-qualified stock options     -          -          -        .04         -       
Release of disproportionate tax effects lodged in OCI     -          -        .13         -          -       
  Return on assets - operating     1.09   %     1.10   %     1.07   %     1.10   %     1.08   %  
                       
Dividend payout ratio reconciliation                      
Dividend payout ratio (GAAP)     26.32   %     23.08   %     27.27   %     21.05   %     22.22   %  
Merger-related and other charges     (1.93 )       (1.13 )     (.98 )     (.54¿ )       (1.71 )    
Impairment of deferred tax asset on canceled non-qualified stock options     -          -          -        (.51 )       -       
Release of disproportionate tax effects lodged in OCI     -          -          (3.21 )       -          -       
  Dividend payout ratio - operating     24.39   %     21.95   %     23.08   %     20.00   %     20.51   %  
                       
Efficiency ratio reconciliation                      
Efficiency ratio (GAAP)     59.27   %     57.89   %     59.29   %     57.65   %     60.78   %  
Merger-related and other charges     (3.09 )       (1.68 )       (1.94 )       (1.07 )       (2.99 )    
  Efficiency ratio - operating     56.18   %     56.21   %     57.35   %     56.58   %     57.79   %  
                       
Average equity to assets reconciliation                      
Equity to assets (GAAP)     10.86   %     10.49   %     10.24   %     10.35   %     10.38   %  
Effect of goodwill and other intangibles     (1.41 )       (1.26 )       (1.28 )       (1.31 )       (1.40 )    
  Tangible equity to assets     9.45         9.23         8.96         9.04         8.98      
Effect of preferred equity     -          -          -          -          -       
  Tangible common equity to assets     9.45   %     9.23   %     8.96   %     9.04   %     8.98   %  
                       
Tangible common equity to risk-weighted assets reconciliation (1)                      
Tier 1 capital ratio (Regulatory)     12.27   %     11.91   %     11.46   %     11.23   %     11.04   %  
Effect of other comprehensive income   (.13 )     (.15 )     (.24 )     (.34 )       -       
Effect of deferred tax limitation   .94       .95         1.13         1.26         1.50      
Effect of trust preferred   (.24 )     (.25 )     (.25 )     (.25 )     (.26 )    
Basel III intangibles transition adjustment   (.03 )     (.02 )     (.03 )     (.06 )     (.06 )    
  Tangible common equity to risk-weighted assets     12.81   %     12.44   %     12.07   %     11.84   %     12.22   %  
                       
(1)  Third quarter 2017 ratios are preliminary.                      
                       

 
UNITED COMMUNITY BANKS, INC.          
Non-GAAP Performance Measures Reconciliation          
Selected Financial Information          
           
           
    For the Nine Months Ended June 30,    
   
(in thousands, except per share data)   2017       2016      
           
Expense reconciliation          
Expenses (GAAP) $   191,729     $   179,968      
Merger-related and other charges     (7,304 )       (6,981 )    
  Expenses - operating $   184,425     $   172,987      
           
Net income reconciliation          
Net income (GAAP) $   79,737     $   73,435      
Merger-related and other charges     7,304         6,981      
Income tax benefit of merger-related and other charges     (2,580 )       (2,642 )    
Impairment of deferred tax asset on canceled non-qualified stock options     -          -       
Release of disproportionate tax effects lodged in OCI     3,400         -       
  Net income - operating $   87,861     $   77,774      
           
Diluted income per common share reconciliation          
Diluted income per common share (GAAP) $   1.10     $   1.02      
Merger-related and other charges   .06         -       
Impairment of deferred tax asset on canceled non-qualified stock options     -          -       
Release of disproportionate tax effects lodged in OCI   .05         -       
  Diluted income per common share - operating $   1.21     $   1.02      
           
Book value per common share reconciliation          
Book value per common share (GAAP) $   16.50     $   15.12      
Effect of goodwill and other intangibles     (2.39 )       (2.12 )    
  Tangible book value per common share $   14.11     $   13.00      
           
Return on tangible common equity reconciliation          
Return on common equity (GAAP)     9.26   %     9.25   %  
Merger-related and other charges   .55       .54      
Impairment of deferred tax asset on canceled non-qualified stock options     -          -       
Release of disproportionate tax effects lodged in OCI   .39         -       
Return on common equity - operating     10.20         9.79      
Effect of goodwill and other intangibles     1.87         1.85      
  Return on tangible common equity - operating     12.07   %     11.64   %  
           
Return on assets reconciliation          
Return on assets (GAAP)   .99   %   .99   %  
Merger-related and other charges   .06       .06      
Impairment of deferred tax asset on canceled non-qualified stock options     -          -       
Release of disproportionate tax effects lodged in OCI   .04         -       
  Return on assets - operating     1.09   %     1.05   %  
           
Dividend payout ratio reconciliation          
Dividend payout ratio (GAAP)     25.45   %     21.57   %  
Merger-related and other charges     (1.31 )       (1.20 )    
Impairment of deferred tax asset on canceled non-qualified stock options     -          -       
Release of disproportionate tax effects lodged in OCI     (1.00 )       -       
  Dividend payout ratio - operating     23.14   %     20.37   %  
           
Efficiency ratio reconciliation          
Efficiency ratio (GAAP)     58.81   %     60.56   %  
Merger-related and other charges     (2.24 )       (2.35 )    
  Efficiency ratio - operating     56.57   %     58.21   %  
           
Average equity to assets reconciliation          
Equity to assets (GAAP)   10.54   %   10.60   %  
Effect of goodwill and other intangibles     (1.33 )       (1.33 )    
  Tangible equity to assets     9.21         9.27      
Effect of preferred equity     -        (.03 )    
  Tangible common equity to assets     9.21   %     9.24   %  
           
Tangible common equity to risk-weighted assets reconciliation (1)          
Tier 1 capital ratio (Regulatory)     12.27   %     11.04   %  
Effect of other comprehensive income   (.13 )       -       
Effect of deferred tax limitation   .94         1.50      
Effect of trust preferred   (.24 )     (.26 )    
Basel III intangibles transition adjustment   (.03 )     (.06 )    
  Tangible common equity to risk-weighted assets     12.81   %     12.22   %  
           
(1)  Third quarter 2017 ratios are preliminary.          
           

 
UNITED COMMUNITY BANKS, INC.            
Financial Highlights                    
Loan Portfolio Composition at Period-End            
                     
                     
      2017     2016
      Third       Second       First       Fourth       Third  
(in millions)   Quarter   Quarter   Quarter   Quarter   Quarter
LOANS BY CATEGORY                    
Owner occupied commercial RE   $   1,792   $   1,723   $   1,633   $   1,650   $   1,587
Income producing commercial RE       1,413       1,342       1,297       1,282       1,277
Commercial & industrial       1,084       1,088       1,080       1,070       994
Commercial construction       583       587       667       634       567
  Total commercial       4,872       4,740       4,677       4,636       4,425
Residential mortgage       933       881       860       857       814
Home equity lines of credit       689       665       659       655       693
Residential construction       190       193       197       190       200
Consumer installment       519       562       572       583       593
  Total loans   $   7,203   $   7,041   $   6,965   $   6,921   $   6,725
                     
LOANS BY MARKET                    
North Georgia   $   1,047   $   1,065   $   1,076   $   1,097   $   1,110
Atlanta MSA       1,477       1,445       1,408       1,399       1,332
North Carolina       542       541       541       545       548
Coastal Georgia       634       623       591       581       565
Gainesville MSA       242       246       252       248       236
East Tennessee       471       486       483       504       506
South Carolina       1,470       1,260       1,243       1,233       1,199
Commercial Banking Solutions       920       926       911       855       763
Indirect auto       400       449       460       459       466
  Total loans   $   7,203   $   7,041   $   6,965   $   6,921   $   6,725
                     

 
UNITED COMMUNITY BANKS, INC.            
Financial Highlights                    
Loan Portfolio Composition at Period-End            
                     
                     
      2017     2016   Linked Quarter Change   Year over Year Change
      Third       Second       Third      
(in millions)   Quarter   Quarter   Quarter    
LOANS BY CATEGORY                    
Owner occupied commercial RE   $   1,792   $   1,723   $   1,587   $   69     $   205  
Income producing commercial RE       1,413       1,342       1,277       71         136  
Commercial & industrial       1,084       1,088       994       (4 )       90  
Commercial construction       583       587       567       (4 )       16  
  Total commercial       4,872       4,740       4,425       132         447  
Residential mortgage       933       881       814       52         119  
Home equity lines of credit       689       665       693       24         (4 )
Residential construction       190       193       200       (3 )       (10 )
Consumer installment       519       562       593       (43 )       (74 )
  Total loans   $   7,203   $   7,041   $   6,725       162         478  
                     
LOANS BY MARKET                    
North Georgia   $   1,047   $   1,065   $   1,110       (18 )       (63 )
Atlanta MSA       1,477       1,445       1,332       32         145  
North Carolina       542       541       548       1         (6 )
Coastal Georgia       634       623       565       11         69  
Gainesville MSA       242       246       236       (4 )       6  
East Tennessee       471       486       506       (15 )       (35 )
South Carolina       1,470       1,260       1,199       210         271  
Commercial Banking Solutions       920       926       763       (6 )       157  
Indirect auto       400       449       466       (49 )       (66 )
  Total loans   $   7,203   $   7,041   $   6,725       162         478  
                     

 
UNITED COMMUNITY BANKS, INC.              
Financial Highlights                  
Credit Quality                  
                   
                   
    Third Quarter 2017
      Nonperforming       Foreclosed       Total  
(in thousands)   Loans   Properties   NPAs
NONPERFORMING ASSETS BY CATEGORY              
Owner occupied CRE   $   5,027     $   764     $   5,791  
Income producing CRE       2,042         121         2,163  
Commercial & industrial       2,378         -          2,378  
Commercial construction       1,376         923         2,299  
  Total commercial       10,823         1,808         12,631  
Residential mortgage       8,559         392         8,951  
Home equity lines of credit       1,898         195         2,093  
Residential construction       178         341         519  
Consumer installment       1,463         -          1,463  
  Total NPAs   $   22,921     $   2,736     $   25,657  
                   
NONPERFORMING ASSETS BY MARKET              
North Georgia   $   6,707     $   404     $   7,111  
Atlanta MSA       1,098         338         1,436  
North Carolina       4,376         318         4,694  
Coastal Georgia       2,532         -          2,532  
Gainesville MSA       763         -          763  
East Tennessee       1,734         67         1,801  
South Carolina       1,903         1,609         3,512  
Commercial Banking Solutions       2,429         -          2,429  
Indirect auto       1,379         -          1,379  
  Total NPAs   $   22,921     $   2,736     $   25,657  
                   
NONPERFORMING ASSETS ACTIVITY              
Beginning Balance   $   23,095     $   2,739     $   25,834  
Acquisitions       20         805         825  
Loans placed on non-accrual       7,964         -          7,964  
Payments received       (5,192 )       -          (5,192 )
Loan charge-offs       (2,159 )       -          (2,159 )
Foreclosures       (807 )       683         (124 )
Property sales       -          (1,295 )       (1,295 )
Write downs       -          (236 )       (236 )
Net gains (losses) on sales       -          40         40  
  Ending Balance   $   22,921     $   2,736     $   25,657  
                   

 
UNITED COMMUNITY BANKS, INC.              
Financial Highlights                  
Credit Quality                  
                   
                   
    Second Quarter 2017
      Nonperforming       Foreclosed       Total  
(in thousands)   Loans   Properties   NPAs
NONPERFORMING ASSETS BY CATEGORY              
Owner occupied CRE   $   5,248     $   580     $   5,828  
Income producing CRE       2,587         -          2,587  
Commercial & industrial       1,010         -          1,010  
Commercial construction       2,530         611         3,141  
  Total commercial       11,375         1,191         12,566  
Residential mortgage       7,886         457         8,343  
Home equity lines of credit       2,152         201         2,353  
Residential construction       287         890         1,177  
Consumer installment       1,395         -          1,395  
  Total NPAs   $   23,095     $   2,739     $   25,834  
                   
NONPERFORMING ASSETS BY MARKET              
North Georgia   $   5,449     $   225     $   5,674  
Atlanta MSA       906         423         1,329  
North Carolina       4,700         472         5,172  
Coastal Georgia       2,542         -          2,542  
Gainesville MSA       622         -          622  
East Tennessee       2,216         103         2,319  
South Carolina       3,472         1,516         4,988  
Commercial Banking Solutions       1,914         -          1,914  
Indirect auto       1,274         -          1,274  
  Total NPAs   $   23,095     $   2,739     $   25,834  
                   
NONPERFORMING ASSETS ACTIVITY              
Beginning Balance   $   19,812     $   5,060     $   24,872  
Acquisitions       -          -          -   
Loans placed on non-accrual       8,110         -          8,110  
Payments received       (2,955 )       -          (2,955 )
Loan charge-offs       (1,564 )       -          (1,564 )
Foreclosures       (308 )       481         173  
Property sales       -          (2,704 )       (2,704 )
Write downs       -          (294 )       (294 )
Net gains (losses) on sales       -          196         196  
  Ending Balance   $   23,095     $   2,739     $   25,834  
                   

 
UNITED COMMUNITY BANKS, INC.              
Financial Highlights                  
Credit Quality                  
                   
                   
    First Quarter 2017
      Nonperforming       Foreclosed       Total  
(in thousands)   Loans   Properties   NPAs
NONPERFORMING ASSETS BY CATEGORY              
Owner occupied CRE   $   6,135     $   1,238     $   7,373  
Income producing CRE       1,540         21         1,561  
Commercial & industrial       929         -          929  
Commercial construction       1,069         2,825         3,894  
  Total commercial       9,673         4,084         13,757  
Residential mortgage       6,455         660         7,115  
Home equity lines of credit       1,848         261         2,109  
Residential construction       417         55         472  
Consumer installment       1,419         -          1,419  
  Total NPAs   $   19,812     $   5,060     $   24,872  
                   
NONPERFORMING ASSETS BY MARKET              
North Georgia   $   5,344     $   570     $   5,914  
Atlanta MSA       715         645         1,360  
North Carolina       4,897         355         5,252  
Coastal Georgia       942         -          942  
Gainesville MSA       728         -          728  
East Tennessee       2,112         633         2,745  
South Carolina       1,725         2,857         4,582  
Commercial Banking Solutions       2,032         -          2,032  
Indirect auto       1,317         -          1,317  
  Total NPAs   $   19,812     $   5,060     $   24,872  
                   
NONPERFORMING ASSETS ACTIVITY              
Beginning Balance   $   21,539     $   7,949     $   29,488  
Acquisitions       -          -          -   
Loans placed on non-accrual       3,172         -          3,172  
Payments received       (3,046 )       -          (3,046 )
Loan charge-offs       (1,292 )       -          (1,292 )
Foreclosures       (561 )       561         -   
Property sales       -          (3,077 )       (3,077 )
Write downs       -          (480 )       (480 )
Net gains (losses) on sales       -          107         107  
  Ending Balance   $   19,812     $   5,060     $   24,872  
                   

 
UNITED COMMUNITY BANKS, INC.                                
Financial Highlights                                    
Credit Quality                                    
                                     
                                     
    Third Quarter 2017   Second Quarter 2017   First Quarter 2017
            Net Charge-             Net Charge-             Net Charge-  
            Offs to             Offs to             Offs to  
      Net       Average       Net       Average       Net       Average  
(in thousands)   Charge-Offs   Loans (1)   Charge-Offs   Loans (1)   Charge-Offs   Loans (1)
NET CHARGE-OFFS BY CATEGORY                                  
Owner occupied CRE   $   (44 )     (.01)  %    $   37       .01  %    $   (212 )     (.05)  % 
Income producing CRE       1,159       .33         184       .06         870       .28  
Commercial & industrial       (200 )     (.08)         354       .13         (152 )     (.06)  
Commercial construction       (114 )     (.07)         341       .22         (370 )     (.23)  
  Total commercial       801       .07         916       .08         136       .01  
Residential mortgage       313       .14         26       .01         530       .25  
Home equity lines of credit       56       .03         253       .15         422       .26  
Residential construction       36       .07         (53 )     (.11)         (9 )     (.02)  
Consumer installment       429       .31         481       .34         600       .42  
  Total   $   1,635       .09     $   1,623       .09     $   1,679       .10  
                                     
NET CHARGE-OFFS BY MARKET                                    
North Georgia   $   516       .19  %    $   681       .26  %    $   15       .01  % 
Atlanta MSA       150       .04         (10 )     -          (46 )     (.01)  
North Carolina       221       .16         131       .10         601       .45  
Coastal Georgia       (39 )     (.02)         120       .08         (223 )     (.15)  
Gainesville MSA       (50 )     (.08)         (54 )     (.09)         358       .58  
East Tennessee       55       .05         27       .02         55       .05  
South Carolina       528       .15         526       .17         425       .14  
Commercial Banking Solutions       (7 )     -          (17 )     (.01)         195       .09  
Indirect auto       261       .24         219       .19         299       .27  
  Total   $   1,635       .09     $   1,623       .09     $   1,679       .10  
                                   
(1)  Annualized. 

 
UNITED COMMUNITY BANKS, INC.                  
Consolidated Statement of Income (Unaudited)                  
                   
    Three Months Ended   Nine Months Ended  
    September 30,   September 30,  
(in thousands, except per share data)     2017     2016       2017     2016    
                   
Interest revenue:                  
Loans, including fees   $   80,264   $   69,440     $   227,816   $   196,888    
Investment securities, including tax exempt of $671, $134, $1,307, and $449       17,875       15,418         53,365       48,039    
Deposits in banks and short-term investments       700       581         1,782       2,315    
Total interest revenue       98,839       85,439         282,963       247,242    
                   
Interest expense:                  
Deposits:                  
NOW       700       452         1,932       1,381    
Money market       1,953       1,347         4,938       3,661    
Savings       34       43         89       102    
Time       1,870       667         4,257       2,052    
Total deposit interest expense       4,557       2,509         11,216       7,196    
Short-term borrowings       36       98         177       278    
Federal Home Loan Bank advances       1,709       1,015         4,603       2,731    
Long-term debt       2,762       2,828         8,490       8,178    
Total interest expense       9,064       6,450         24,486       18,383    
Net interest revenue       89,775       78,989         258,477       228,859    
(Release of) provision for credit losses       1,000       (300 )       2,600       (800 )  
Net interest revenue after provision for credit losses       88,775       79,289         255,877       229,659    
                   
Fee revenue:                  
Service charges and fees       8,220       10,819         29,525       31,460    
Mortgage loan and other related fees       4,200       6,039         13,435       13,776    
Brokerage fees       1,009       1,199         3,565       3,369    
Gains from sales of SBA/USDA loans       2,806       2,479         7,391       6,517    
Securities gains, net       188       261         190       922    
Other        4,150       5,564         12,226       12,420    
Total fee revenue       20,573       26,361         66,332       68,464    
Total revenue       109,348       105,650         322,209       298,123    
                   
Operating expenses:                  
Salaries and employee benefits       38,027       36,478         112,056       103,112    
Communications and equipment       4,547       4,919         14,443       13,602    
Occupancy       4,945       5,132         14,802       14,393    
Advertising and public relations       1,026       1,088         3,347       3,275    
Postage, printing and supplies       1,411       1,451         4,127       4,029    
Professional fees       2,976       3,160         8,391       9,049    
FDIC assessments and other regulatory charges       2,127       1,412         4,758       4,453    
Amortization of intangibles       1,212       1,119         3,085       3,116    
Merger-related and other charges       3,176       3,152         7,060       6,981    
Other        6,227       6,112         19,660       17,958    
Total operating expenses       65,674       64,023         191,729       179,968    
Net income before income taxes       43,674       41,627         130,480       118,155    
Income tax expense       15,728       15,753         50,743       44,720    
Net income   $   27,946   $   25,874     $   79,737   $   73,435    
                   
Net income available to common shareholders   $   27,719   $   25,874     $   79,078   $   73,414    
                   
Earnings per common share:                  
  Basic    $   .38    $   .36     $   1.10   $   1.02    
  Diluted     .38     .36         1.10       1.02    
Weighted average common shares outstanding:                  
  Basic       73,151       71,556         72,060       71,992    
  Diluted       73,162       71,561         72,071       71,996    
                   

 
UNITED COMMUNITY BANKS, INC.        
Consolidated Balance Sheet (Unaudited)        
         
    September 30,   December 31,
(in thousands, except share and per share data)     2017       2016  
         
ASSETS        
  Cash and due from banks   $   98,396     $   99,489  
  Interest-bearing deposits in banks       148,449         117,859  
  Cash and cash equivalents       246,845         217,348  
  Securities available for sale        2,540,470         2,432,438  
  Securities held to maturity (fair value $310,446 and $333,170)       306,741         329,843  
  Mortgage loans held for sale (includes $30,093 and $27,891 at fair value)       30,292         29,878  
  Loans, net of unearned income       7,202,937         6,920,636  
  Less allowance for loan losses       (58,605 )       (61,422 )
  Loans, net       7,144,332         6,859,214  
  Premises and equipment, net       193,915         189,938  
  Bank owned life insurance       167,680         143,543  
  Accrued interest receivable       29,573         28,018  
  Net deferred tax asset       128,731         154,336  
  Derivative financial instruments       20,972         23,688  
  Goodwill and other intangible assets       182,716         156,222  
  Other assets       136,760         144,189  
  Total assets   $   11,129,027     $   10,708,655  
LIABILITIES AND SHAREHOLDERS' EQUITY        
Liabilities:        
  Deposits:        
  Demand   $   2,918,428     $   2,637,004  
  NOW       1,938,352         1,989,763  
  Money market       1,934,169         1,846,440  
  Savings       605,230         549,713  
  Time       1,363,949         1,287,142  
  Brokered       367,256         327,496  
  Total deposits       9,127,384         8,637,558  
  Short-term borrowings       16,005         5,000  
  Federal Home Loan Bank advances       494,484         709,209  
  Long-term debt       135,707         175,078  
  Derivative financial instruments       22,926         27,648  
  Accrued expenses and other liabilities       111,881         78,427  
  Total liabilities       9,908,387         9,632,920  
Shareholders' equity:        
  Common stock, $1 par value; 150,000,000 shares authorized;        
  73,403,453 and 70,899,114 shares issued and outstanding       73,403         70,899  
  Common stock issuable; 588,445 and 519,874 shares       8,703         7,327  
  Capital surplus       1,341,346         1,275,849  
  Accumulated deficit       (192,128 )       (251,857 )
  Accumulated other comprehensive loss       (10,684 )       (26,483 )
  Total shareholders' equity       1,220,640         1,075,735  
  Total liabilities and shareholders' equity   $   11,129,027     $   10,708,655  
         

 
UNITED COMMUNITY BANKS, INC.                        
Average Consolidated Balance Sheets and Net Interest Analysis                  
For the Three Months Ended September 30,                         
                         
        2017             2016        
    Average       Avg.       Average       Avg.    
(dollars in thousands, fully taxable equivalent (FTE) )   Balance       Interest   Rate       Balance       Interest   Rate    
Assets:                        
Interest-earning assets:                        
  Loans, net of unearned income (FTE) (1)(2) $   7,149,348     $   80,301 4.46 %   $   6,675,328     $   69,427   4.14 %  
  Taxable securities (3)     2,695,162         17,204 2.55         2,588,037         15,284   2.36    
  Tax-exempt securities (FTE) (1)(3)     105,151         1,098 4.18         22,113         219   3.96    
  Federal funds sold and other interest-earning assets     183,170         883 1.93         157,972         754   1.91    
                         
  Total interest-earning assets (FTE)     10,132,831         99,486 3.90         9,443,450         85,684   3.61    
Non-interest-earning assets:                        
  Allowance for loan losses     (60,098 )               (63,874 )          
  Cash and due from banks     103,477                 100,775            
  Premises and equipment     203,579                 198,234            
  Other assets (3)     599,725                 602,690            
  Total assets $   10,979,514             $   10,281,275            
                         
Liabilities and Shareholders' Equity:                        
Interest-bearing liabilities:                        
  Interest-bearing deposits:                        
NOW $   1,863,160         700 .15     $   1,744,473         452   .10    
Money market     2,170,148         1,953 .36         1,997,165         1,347   .27    
Savings     593,823         34 .02         537,447         43   .03    
Time     1,338,786         1,548 .46         1,375,706         833   .24    
Brokered time deposits     109,811         322 1.16         162,255         (166 ) (.41)    
  Total interest-bearing deposits     6,075,728           4,557 .30         5,817,046           2,509   .17    
                         
Federal funds purchased and other borrowings     11,313         36 1.26         42,234         98   .92    
Federal Home Loan Bank advances     574,404         1,709 1.18         583,312         1,015   .69    
Long-term debt     154,616         2,762 7.09         177,333         2,828   6.34    
  Total borrowed funds     740,333         4,507 2.42         802,879         3,941   1.95    
                         
  Total interest-bearing liabilities     6,816,061         9,064 .53         6,619,925         6,450   .39    
Non-interest-bearing liabilities:                        
  Non-interest-bearing deposits     2,837,378                 2,490,019            
  Other liabilities     133,212                 103,859            
  Total liabilities