<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): October 18, 2000
THE COLONIAL BANCGROUP, INC.
(Exact name of registrant as specified in its charter)
Delaware 1-13508 63-0661573
(State of Incorporation) (Commission File No.) (IRS Employer I.D. No.)
Colonial Financial Center, Suite 800
One Commerce Street, Montgomery, Alabama 36104
(Address of Principal Executive Office) (Zip code)
Registrant's telephone number, including area code: 334-240-5000
<PAGE> 2
INDEX TO FILING
Press Release as issued on October 18, 2000 2
Financial Information 8
Supplemental and Forward Looking Information 15
ITEM 5. OTHER EVENTS
[PRESS RELEASE AS ISSUED ON OCTOBER 18, 2000]
For more information contact: October 18, 2000
Lisa Free (334) 240-5105
Flake Oakley (334) 240-5061
COLONIAL BANCGROUP ANNOUNCES
QUARTERLY EARNINGS
- Operating income increased 8% for the quarter and 10% year-to-date
from the prior year
- Annualized internal loan growth was 12% for the quarter and 16%
year-to-date
- Noninterest income from operations increased 25% for the quarter and
17% year-to-date from the prior year
- Asset quality remained outstanding with non-performing assets at .56%
of loans & other real estate
MONTGOMERY, AL -- The Colonial BancGroup, Inc. Chairman and CEO,
Robert E. Lowder announced today that for the quarter ended September 30, 2000
operating earnings were $28,561,000 or $.26 per diluted share versus
$27,576,000 or $.24 per share
2
<PAGE> 3
for third quarter 1999, an 8% increase. Year-to-date operating earnings through
September 30, 2000 were $89,217,000 or $.80 per share as compared to
$82,518,000 or $.73 per share for the same period in 1999.
<TABLE>
<CAPTION>
EARNINGS SUMMARY NINE MONTHS ENDED SEPT. 30, THREE MONTHS ENDED SEPT. 30,
(Dollars in 000's, except per share amts.) % CHANGE % CHANGE
2000 1999(1) 99 TO '00 2000 1999(1) 99 TO '00
----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Operating Income:
Net interest income (taxable $295,435 $277,651 6% $97,034 $95,699 1%
equivalent)
Provision for loan losses 21,822 19,468 12% 8,861 7,014 26%
Noninterest income 56,598 48,548 17% 20,649 16,548 25%
Noninterest expense 187,067 173,479 8% 62,976 60,755 4%
OPERATING INCOME (NET OF INCOME TAXES) 89,217 82,518 8% 28,561 27,576 4%
EARNINGS PER SHARE:
OPERATING INCOME (NET OF INCOME TAXES)
DILUTED $0.80 $0.73 10% $0.26 $0.24 8%
SELECTED RATIOS:
Operating Income to:
Average assets 1.06% 1.05% 0.99% 1.03%
Average shareholders' equity 16.99% 16.53% 15.92% 16.11%
Operating Ratios:
Efficiency ratio 53.14% 53.18% 53.51% 54.13%
Non interest income (annualized) to 0.67% 0.61% 0.72% 0.62%
average assets
Non interest expense (annualized) to 2.21% 2.19% 2.20% 2.28%
average assets
Net interest margin 3.79% 3.96% 3.65% 3.98%
Equity to assets 6.31% 6.41%
Tier one leverage 6.50% 6.40%
</TABLE>
(1) Operating Income for the third quarter and nine months of 1999 excludes
$5,787,000 and $6,405,000 after taxes, respectively, from the gain on sale of
certain branches and other one time miscellaneous income.
<TABLE>
<CAPTION>
STATEMENT OF CONDITION SUMMARY % CHANGE
(Dollars in 000's, except per share amts.) SEPT. 30, DEC. 31, SEPT. 30, SEPT. 30,
2000 1999 1999 99 TO '00
----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Total assets $11,475,528 $10,854,099 $10,620,924 8%
Loans, net of unearned income 9,107,393 8,228,149 7,856,226 16%
Total earning Assets 10,709,231 9,843,454 9,635,041 11%
Deposits 8,043,850 7,967,978 7,601,210 6%
Shareholders' equity 723,576 695,179 680,743 6%
Book value per share $ 6.56 $ 6.20 $ 6.08 8%
</TABLE>
3
<PAGE> 4
<TABLE>
<CAPTION>
NONPERFORMING ASSETS SEPT. 30, DEC. 31, SEPT. 30,
2000 1999 1999
--------------------------------------------------------------------------------------
<S> <C> <C> <C>
Total non-performing assets ratio 0.56% 0.55% 0.45%
Loan loss reserve ratio 1.14% 1.17% 1.17%
Allowance as a percent of nonperforming loans 234% 269% 311%
Net charge-offs ratio (annualized):
Quarter to date 0.29% 0.25% 0.17%
Year to date 0.21% 0.21% 0.20%
</TABLE>
Net interest income increased 6% and 1% for the nine and three months
ended September 30, 2000 compared to the same period last year. This increase
is primarily the result of 16% and 12% annualized internal loan growth for the
year and quarter, respectively. However, loan growth was overshadowed by
increased margin compression. As with other banks, the Company's net interest
margin declined during the quarter. Net interest margin for the third quarter
2000 decreased to 3.65% compared to 3.85% for the second quarter 2000 and 3.98%
for the third quarter of 1999.
Noninterest income increased 25% for the quarter ended September 30,
2000 and 17% year-to-date primarily from wealth management services income,
electronic banking fees and merchant/cardholder fees. Noninterest expenses
increased 4% for the quarter ended September 30, 2000 and 8% year-to-date.
Asset quality remains excellent with non-performing assets at .56% of
loans and other real estate owned compared to .55% at December 31, 1999.
Annualized net charge-offs year-to-date remain low at .29% of loans for the
quarter, half of which were from a single large loan to an Alabama customer.
Annualized year to date net charge-offs of .21% of loans were equal to the .21%
experience for the full year 1999. Colonial continues to focus its efforts on
relationship-based lending to known customers in its geographical market areas.
Therefore, Colonial does not have any significant exposure to losses from
nationwide syndicated lending operations, indirect auto financing or sub-prime
lending.
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<PAGE> 5
Loan provisions for the current quarter were $8,861,000 compared to $7,014,000
in 1999, exceeding net charge-offs by $2,471,000 and $3,678,000 in the
respective periods.
"I believe Colonial is well positioned for growth and sufficiently
diversified to withstand an economic slowdown should one develop. We have the
ability to compete on an equal footing with our peers for loan, deposit and
fee-based income business," said Mr. Lowder. Excluding one to four family
residential loans, Colonial's loan portfolio is distributed throughout its
banking regions as follows: 42% in Alabama, 39% in Florida, 12% in Georgia, 4%
in Nevada and 3% in Texas. The company's retail deposit base is currently 45%
in Alabama, 39% in Florida, 10% in Georgia, 3% in Nevada and 3% in Texas.
The Company's growth market strategy put in place in 1996 has realized
considerable success in the 2000 growth rates in various markets. The Company's
Alabama markets have experienced 6% annualized loan growth and 6% deposit
growth, while the Company's higher growth markets have contributed 25% loan
growth and 16% deposit growth during this year.
In July 2000, the Company announced definitive plans to exit the
mortgage banking business. As of September 30, 2000 all sales of servicing
rights have been completed with the transfers of the loans expected to be
completed by year-end. The financial results for this line of business have
been separately reported as discontinued operations in all periods presented.
The following table reflects income from continuing operations and net income
which includes income or loss from discontinued operations as well as the
estimated loss from disposal of this line of business:
5
<PAGE> 6
<TABLE>
<CAPTION>
(Dollars in 000's, except per share amounts) NINE MONTHS ENDED SEPT. 30, THREE MONTHS ENDED SEPT. 30,
----------------------------------------------------------------
% CHANGE % CHANGE
EARNINGS SUMMARY 1999 TO 1999 TO
2000 1999 2000 2000 1999 2000
---- ---- --------- ---- ---- ---------
<S> <C> <C> <C> <C> <C> <C>
Continuing Operations:
Net interest income (taxable equivalent) $295,435 $277,651 6% $ 97,034 $ 95,699 1%
Provision for loan losses 21,822 19,468 12% 8,861 7,014 26%
Noninterest income 56,598 58,715 -4% 20,649 25,733 -20%
Noninterest expense 187,067 173,479 8% 62,976 60,755 4%
INCOME FROM CONTINUING OPERATIONS (NET OF INCOME TAXES) 89,217 88,923 0% 28,561 33,363 -14%
Income(Loss) from discontinued operations and loss
on disposal (net of income taxes) (4,699) (76) 0 (2,927)
Net income $ 84,518 $ 88,847 -5% $ 28,561 $ 30,436 -6%
Average shares outstanding 110,917 111,580 110,260 111,815
Average diluted shares outstanding 111,650 113,229 110,965 113,433
Earnings per share:
INCOME FROM CONTINUING OPERATIONS (NET OF INCOME TAXES):
BASIC $ 0.80 $ 0.80 1% $ 0.26 $ 0.30 -13%
DILUTED $ 0.80 $ 0.79 2% $ 0.26 $ 0.29 -12%
Net Income
Basic $ 0.76 $ 0.80 -4% $ 0.26 $ 0.27 -5%
Diluted $ 0.76 $ 0.79 -4% $ 0.26 $ 0.27 -4%
SELECTED RATIOS:
Income from continuing operations to:
Average assets 1.06% 1.11% 0.99% 1.08%
Average shareholders' equity 16.99% 17.49% 15.92% 16.96%
Continuing Operations:
Efficiency ratio 53.14% 51.57% 53.51% 50.03%
Non interest income (annualized) to average assets 0.67% 0.71% 0.72% 0.71%
Non interest expense (annualized) to average assets 2.21% 2.19% 2.20% 2.28%
</TABLE>
Colonial BancGroup currently operates 233 offices in Alabama, Florida,
Georgia, Tennessee, Texas and Nevada and is traded on the New York Stock
Exchange under the symbol CNB. In most newspapers the stock is listed as
ColBgp.
More detailed information on Colonial BancGroup's quarterly earnings is
available on the company's website at www.colonialbank.com or in the Current
Report on Form 8-K filed today with the Securities and Exchange Commission.
Copies of the Form 8-K are also available from the contact persons listed above.
This release and the above referenced Current Report on Form 8-K of
which this release forms a part contain "forward-looking statements" within the
meaning of the federal securities laws. The forward-looking statements in this
release are subject to risks and
6
<PAGE> 7
uncertainties that could cause actual results to differ materially from those
expressed in or implied by the statements. Factors that may cause actual
results to differ materially from those contemplated by such forward-looking
statements include, among other things, the following possibilities; (i) an
inability of the company to realize elements of its strategic plans for 2000
and 2001; (ii) increases in competitive pressure in the banking industry; (iii)
general economic conditions, either nationally or regionally, that are less
favorable than expected; (iv)and changes which may occur in the regulatory
environment. When used in this Report, the words "believes," "estimates,",
"plans," "expects," "should," "may," "might," "outlook," and "anticipates," and
similar expressions as they relate to BancGroup (including its subsidiaries) or
its management are intended to identify forward-looking statements.
7
<PAGE> 8
FINANCIAL INFORMATION
THE COLONIAL BANCGROUP, INC. AND SUBSIDIARIES
SELECTED FINANCIAL DATA (UNAUDITED)
(Dollars in thousands, except per share amounts)
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------------
% CHANGE
SEPTEMBER 30, DECEMBER 31, SEPTEMBER 30, SEPTEMBER 30,
2000 1999 1999 1999 TO 2000
-----------------------------------------------------------------------------------------------------------------------------------
STATEMENT OF CONDITION SUMMARY
<S> <C> <C> <C> <C>
Total assets ..................................................... $11,475,528 $10,854,099 $10,620,924 8%
Loans, net of unearned income .................................... 9,107,393 8,228,149 7,856,226 16%
Total earning assets ............................................. 10,709,231 9,843,454 9,635,041 11%
Deposits ......................................................... 8,043,850 7,967,978 7,601,210 6%
Shareholders' equity ............................................. 723,576 695,179 680,743 6%
Book value per share ............................................. $ 6.56 $ 6.20 $ 6.08 8%
-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30, THREE MONTHS ENDED SEPTEMBER 30,
------------------------------------------------------------------------------------------------------------------------------
% CHANGE % CHANGE
2000 1999(1) 1999 TO 2000 2000 1999(1) 1999 TO 2000
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
EARNINGS SUMMARY
Operating Income:
Net interest income (taxable equivalent) .... $295,435 $277,651 6% $ 97,034 $95,699 1%
Provision for loan losses ................... 21,822 19,468 12% 8,861 7,014 26%
Noninterest income .......................... 56,598 48,548 17% 20,649 16,548 25%
Noninterest expense ......................... 187,067 173,479 8% 62,976 60,755 4%
Operating Income (net of income taxes) ........... 89,217 82,518 8% 28,561 27,576 4%
Average shares outstanding ....................... 110,917 111,580 110,260 111,815
Average diluted shares outstanding ............... 111,650 113,229 110,965 113,433
Earnings per share:
Operating Income (net of income taxes) diluted ... $ 0.80 $ 0.73 10% $ 0.26 $ 0.24 8%
SELECTED RATIOS:
Operating Income:
Average assets ................................. 1.06% 1.05% 0.99% 1.03%
Average shareholders' equity ................... 16.99% 16.53% 15.92% 16.11%
Operating Ratios:
Efficiency ratio ............................ 53.14% 53.18% 53.51% 54.13%
Non interest income (annualized)
to average assets ......................... 0.67% 0.61% 0.72% 0.62%
Non interest expense (annualized)
to average assets ......................... 2.21% 2.19% 2.20% 2.28%
Consolidated:
Net interest margin......................... 3.79% 3.96% 3.65% 3.98%
Equity to assets ........................... 6.31% 6.41%
Tier one leverage .......................... 6.50% 6.40%
-------------------
(1) Operating income for the third quarter and nine months of 1999 excludes
$5,787,000 and $6,405,000 after taxes, respectively, from the gain on sale
of certain branches and other one time miscellaneous income.
==================================================================================================================================
</TABLE>
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31, SEPTEMBER 30,
2000 1999 1999
----------------------------------------------------------------------------------------------------------------------------------
NONPERFORMING ASSETS
<S> <C> <C> <C>
Total non-performing assets ratio.................................. 0.56% 0.55% 0.45%
Loan loss reserve ratio............................................ 1.14% 1.17% 1.17%
Allowance as a percent of nonperforming loans...................... 234% 269% 311%
Net charge-offs ratio (annualized):
Quarter to date .............................................. 0.29% 0.25% 0.17%
Year to date ................................................. 0.21% 0.21% 0.20%
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
8
<PAGE> 9
THE COLONIAL BANCGROUP, INC. AND SUBSIDIARIES
SELECTED FINANCIAL DATA CONTINUED (UNAUDITED)
(Dollars in thousands, except per share amounts)
<TABLE>
<CAPTION>
NINE MONTHS ENDED SEPTEMBER 30, THREE MONTHS ENDED SEPTEMBER 30,
-----------------------------------------------------------------------------------------------------------------------------------
% CHANGE % CHANGE
1999 TO 1999 TO
2000 1999 2000 2000 1999 2000
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Earnings Summary
Continuing Operations:
Net interest income (taxable equivalent) ............. $ 295,435 $ 277,651 6% $ 97,034 $ 95,699 1%
Provision for loan losses ............................ 21,822 19,468 12% 8,861 7,014 26%
Noninterest income ................................... 56,598 58,715 -4% 20,649 25,733 -20%
Noninterest expense .................................. 187,067 173,479 8% 62,976 60,755 4%
INCOME FROM CONTINUING OPERATIONS (NET OF INCOME TAXES) .... 89,217 88,923 0% 28,561 33,363 -14%
Income (Loss) from discontinued operations and loss
on disposal (net of income taxes) .................... (4,699) (76) 0 (2,927)
Net income ................................................. $ 84,518 $ 88,847 -5% $ 28,561 30,436 -6%
Average shares outstanding ................................. 110,917 111,580 110,260 111,815
Average diluted shares outstanding ......................... 111,650 113,229 110,965 113,433
Earnings per share:
INCOME FROM CONTINUING OPERATIONS (NET OF INCOME TAXES):
Basic ................................................. $ 0.80 $ 0.80 1% $ 0.26 $ .30 -13%
Diluted ............................................... $ 0.80 $ 0.79 2% $ 0.26 $ .29 -12%
Net Income
Basic ................................................. $ 0.76 $ 0.80 -4% $ 0.26 $ .27 -5%
Diluted ............................................... $ 0.76 $ 0.79 -4% $ 0.26 $ .27 -4%
SELECTED RATIOS:
Income from continuing operations to:
Average assets ........................................... 1.06% 1.11% 0.99% 1.08%
Average shareholders' equity.............................. 16.99% 17.49% 15.92% 16.96%
Continuing Operations:
Efficiency ratio...................................... 53.14% 51.57% 53.51% 50.03%
Non interest income (annualized) to average assets.... 0.67% 0.71% 0.72% 0.71%
Non interest expense (annualized) to average assets... 2.21% 2.19% 2.20% 2.28%
===================================================================================================================================
</TABLE>
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<PAGE> 10
THE COLONIAL BANCGROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(Dollars in thousands, except per share amounts)
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------------------
NINE MONTHS ENDED THREE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
-------------------------------------------------------------------------------------------------------------------------
2000 1999 2000 1999
<S> <C> <C> <C> <C>
Interest Income:
Interest and fees on loans ......................................... $ 579,127 $ 475,930 $202,489 $ 165,851
Interest on investments ............................................ 81,234 74,573 27,227 25,542
Other interest income .............................................. 1,967 1,810 712 620
-------------------------------------------------------------------------------------------------------------------------
Total interest income .............................................. 662,328 552,313 230,428 192,013
-------------------------------------------------------------------------------------------------------------------------
INTEREST EXPENSE:
Interest on deposits ............................................... 256,576 200,900 92,718 68,945
Interest on short-term borrowings .................................. 68,375 37,042 26,870 13,739
Interest on long-term debt ......................................... 44,564 38,980 14,674 14,207
-------------------------------------------------------------------------------------------------------------------------
Total interest expense ............................................. 369,515 276,922 134,262 96,891
-------------------------------------------------------------------------------------------------------------------------
NET INTEREST INCOME ................................................ 292,813 275,391 96,166 95,122
Provision for possible loan losses ................................. 21,822 19,468 8,861 7,014
-------------------------------------------------------------------------------------------------------------------------
NET INTEREST INCOME AFTER PROVISION FOR POSSIBLE LOAN LOSSES ....... 270,991 255,923 87,305 88,108
-------------------------------------------------------------------------------------------------------------------------
NONINTEREST INCOME:
Service charges on deposit accounts ................................ 28,551 28,660 9,726 9,739
Other charges, fees and commissions ................................ 7,925 6,598 2,873 2,091
Securities gains(losses), net ...................................... (40) 499 21 490
Other income ....................................................... 20,162 22,958 8,029 13,413
-------------------------------------------------------------------------------------------------------------------------
Total noninterest income ........................................... 56,598 58,715 20,649 25,733
-------------------------------------------------------------------------------------------------------------------------
NONINTEREST EXPENSE:
Salaries and employee benefits ..................................... 93,501 85,493 32,158 29,380
Occupancy expense of bank premises, net ............................ 22,479 20,863 7,788 7,187
Furniture and equipment expenses ................................... 21,521 18,749 7,277 6,568
Other expense ...................................................... 49,566 48,374 15,753 17,620
-------------------------------------------------------------------------------------------------------------------------
Total noninterest expense .......................................... 187,067 173,479 62,976 60,755
-------------------------------------------------------------------------------------------------------------------------
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES .............. 140,522 141,159 44,978 53,086
Applicable income taxes ............................................ 51,305 52,236 16,417 19,723
-------------------------------------------------------------------------------------------------------------------------
INCOME FROM CONTINUING OPERATIONS .................................. 89,217 88,923 28,561 33,363
Discontinued Operations:
Income/(Loss) from discontinued operations, net of income taxes
of $(450), $(46), $0,and $(1,771) for the nine months ended
September 30, 2000 and 1999 and for the three months ended (743) (76) -- (2,927)
September 30, 2000 and 1999
Loss on disposal of discontinued operations (net of income tax
benefit of $2,394) ........................................ (3,956) -- -- --
-------------------------------------------------------------------------------------------------------------------------
Net Income ......................................................... $ 84,518 $ 88,847 $ 28,561 $ 30,436
-------------------------------------------------------------------------------------------------------------------------
Earnings per share:
INCOME FROM CONTINUING OPERATIONS:
Basic ..................................................... $ 0.80 $ 0.80 $ 0.26 $ 0.30
Diluted ................................................... $ 0.80 $ 0.79 $ 0.26 $ 0.29
Net Income
Basic ..................................................... $ 0.76 $ 0.80 $ 0.26 $ 0.27
Diluted ................................................... $ 0.76 $ 0.79 $ 0.26 $ 0.27
</TABLE>
10
<PAGE> 11
THE COLONIAL BANCGROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CONDITION (UNAUDITED)
(Dollars in thousands, except per share amounts)
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------------
SEPTEMBER 30, DECEMBER 31, SEPTEMBER 30,
2000 1999 1999
-----------------------------------------------------------------------------------------------------------------------------------
ASSETS:
<S> <C> <C> <C>
Cash and due from banks ........................................................ $ 280,628 $ 338,433 $ 324,015
Interest-bearing deposits in banks and federal funds sold ...................... 61,122 30,482 17,355
Securities held for trading .................................................... -- -- 709
Securities available for sale .................................................. 1,482,962 1,489,991 1,475,364
Investment securities .......................................................... 47,814 61,682 103,294
Mortgage loans held for sale ................................................... 9,940 33,150 182,093
Loans, net of unearned income .................................................. 9,107,393 8,228,149 7,856,226
Less:
Allowance for possible loan losses ........................................... (103,861) (95,993) (91,752)
-----------------------------------------------------------------------------------------------------------------------------------
Loans, net ..................................................................... 9,003,532 8,132,156 7,764,474
Premises and equipment, net .................................................... 186,239 190,946 194,557
Excess of cost over tangible and identified intangible
assets acquired, net ......................................................... 75,691 79,468 80,892
Mortgage servicing rights ...................................................... 0 238,405 270,428
Other real estate owned ........................................................ 6,510 9,215 6,196
Accrued interest and other assets .............................................. 321,090 250,171 201,547
-----------------------------------------------------------------------------------------------------------------------------------
Total .......................................................................... $11,475,528 $10,854,099 $10,620,924
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
LIABILITIES AND SHAREHOLDERS' EQUITY:
Deposits ....................................................................... $ 8,043,850 $ 7,967,978 $ 7,601,210
FHLB short-term borrowings ..................................................... 475,000 490,000 370,000
Other short-term borrowings .................................................... 1,475,526 703,429 912,600
Subordinated debt .............................................................. 111,929 112,048 112,440
Trust preferred securities ..................................................... 70,000 70,000 70,000
FHLB long-term debt ............................................................ 347,136 572,549 645,515
Other long-term debt ........................................................... 134,475 134,974 135,167
Other liabilities .............................................................. 94,036 107,942 93,249
-----------------------------------------------------------------------------------------------------------------------------------
Total liabilities .............................................................. 10,751,952 10,158,920 9,940,181
Shareholders' equity:
Preference Stock $2.50 par value; 1,000,000 shares
authorized, none issued .................................................... -- -- --
Common Stock, $2.50 par value; 200,000,000 shares authorized
113,083,937, 112,106,663, 111,920,707 shares issued at
September 30, 2000, December 31, 1999, September 30, 1999, respectively .... 282,710 280,267 279,802
Treasury shares (2,788,420 at September 30, 2000) .......................... (26,607) -- --
Additional paid in capital ................................................... 118,650 118,728 118,103
Retained earnings ............................................................ 374,361 326,578 306,462
Unearned compensation ........................................................ (2,942) (1,622) (1,839)
Accumulated other comprehensive income (loss), net of taxes .................. (22,596) (28,772) (21,785)
-----------------------------------------------------------------------------------------------------------------------------------
Total shareholders' equity ..................................................... 723,576 695,179 680,743
-----------------------------------------------------------------------------------------------------------------------------------
Total .......................................................................... $11,475,528 $10,854,099 $10,620,924
-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
11
<PAGE> 12
THE COLONIAL BANCGROUP, INC. AND SUBSIDIARIES
AVERAGE VOLUME AND RATES
(UNAUDITED)
(Dollars in thousands)
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------------------------
THREE MONTHS ENDED
----------------------------------------------------------------------------------------------------------------------------------
SEPTEMBER 30, JUNE 30,
2000 2000
----------------------------------------------------------------------------------------------------------------------------------
AVERAGE AVERAGE
VOLUME INTEREST RATE VOLUME INTEREST RATE
----------------------------------------------------------------------------------------------------------------------------------
ASSETS
<S> <C> <C> <C> <C> <C> <C>
Loans, net................................. $ 8,953,208 $202,640 9.01% $ 8,765,295 $195,438 8.96%
Mortgage loans held for sale............... 7,820 169 8.64% 19,895 424 8.52%
Investment securities and securities
available for sale and other
interest-earning assets................... 1,674,933 28,591 6.80% 1,690,215 28,699 6.79%
---------------------------------------------------------------------------- ------------------------
Total interest-earning assets(1)........... 10,635,961 $231,400 8.67% 10,475,405 $224,561 8.61%
---------------------------------------------------------------------------- ------------------------
Nonearning assets.......................... 812,206 905,494
-------------------------------------------------------------- -----------
Total assets............................. $11,448,167 $11,380,899
----------------------------------------------------------------------------------------------------------------------------------
LIABILITIES AND SHAREHOLDERS' EQUITY:
Interest-bearing deposits.................. $ 6,866,967 $ 92,718 5.37% $ 6,805,097 $86,072 5.09%
Short-term borrowings...................... 1,626,957 26,870 6.57% 1,451,161 22,733 6.30%
Long-term debt............................. 895,477 14,630 6.50% 955,996 15,182 6.39%
---------------------------------------------------------------------------- ------------------------
Total interest-bearing liabilities......... 9,389,401 $134,218 5.69% 9,212,254 $123,987 5.41%
---------------------------------------------------------------------------- ------------------------
Noninterest-bearing demand deposits........ 1,250,118 1,365,427
Other liabilities.......................... 95,156 108,913
----------- -----------
Total liabilities.......................... 10,734,675 10,686,594
Shareholders' equity....................... 713,492 694,305
-------------------------------------------------------------- -----------
Total liabilities and shareholders'
equity...................................... $11,448,167 $11,380,899
----------------------------------------------------------------------------------------------------------------------------------
RATE DIFFERENTIAL............................ 2.98% 3.20%
NET YIELD ON INTEREST-EARNING ASSETS......... $ 97,182 3.65% $100,574 3.85%
----------------------------------------------------------------------------------------------------------------------------------
<CAPTION>
-------------------------------------------------------------------------------------------------
SEPTEMBER 30,
1999
-------------------------------------------------------------------------------------------------
AVERAGE
VOLUME INTEREST RATE
-------------------------------------------------------------------------------------------------
ASSETS
<S> <C> <C> <C>
Loans, net................................. $ 7,749,951 $166,034 8.51%
Mortgage loans held for sale............... 215,119 4,226 7.86%
Investment securities and securities
available for sale and other
interest-earning assets................... 1,697,875 26,643 6.27%
------------------------------------------------- -------------------------
Total interest-earning assets(1)........... 9,662,945 $196,903 8.10%
------------------------------------------------- -------------------------
Nonearning assets.......................... 979,842
------------------------------------------------- -------------
Total assets............................. $10,642,787
-------------------------------------------------------------------------------------------------
LIABILITIES AND SHAREHOLDERS' EQUITY:
Interest-bearing deposits.................. $ 6,255,514 $ 68,945 4.37%
Short-term borrowings...................... 1,245,135 16,000 5.10%
Long-term debt............................. 988,379 15,401 6.19%
----------------------------------------------- -------------------------
Total interest-bearing liabilities......... 8,489,028 $100,346 4.69%
----------------------------------------------- -------------------------
Noninterest-bearing demand deposits........ 1,391,870
Other liabilities.......................... 82,719
-------------
Total liabilities.......................... 9,963,617
Shareholders' equity....................... 679,170
----------------------------------------------- -------------
Total liabilities and shareholders'
equity...................................... $10,642,787
-------------------------------------------------------------------------------------------------
RATE DIFFERENTIAL............................ 3.41%
NET YIELD ON INTEREST-EARNING ASSETS......... $ 96,557 3.98%
-------------------------------------------------------------------------------------------------
</TABLE>
(1) Interest earned and average rates on obligations of states and political
subdivisions are reflected on a tax equivalent basis. Tax equivalent
interest earned is: actual interest earned times 145%. The taxable
equivalent adjustment has given effect to the disallowance of interest
expense deductions, for federal income tax purposes, related to certain
tax-free assets.
12
<PAGE> 13
THE COLONIAL BANCGROUP, INC. AND SUBSIDIARIES
AVERAGE VOLUME AND RATES
(UNAUDITED)
(Dollars in thousands)
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------------
NINE MONTHS ENDED SEPTEMBER 30,
-----------------------------------------------------------------------------------------------------------------------------------
2000 1999
-----------------------------------------------------------------------------------------------------------------------------------
AVERAGE AVERAGE
VOLUME INTEREST RATE VOLUME INTEREST RATE
-----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
ASSETS
Loans, net of unearned income ..................... $ 8,692,852 $ 579,020 8.89% $ 7,475,553 $ 476,633 8.52%
Mortgage loans held for sale ...................... 16,753 1,005 8.00% 424,071 23,224 7.30%
Investment securities and securities available
for sale and other interest-earning assets ..... 1,673,797 85,178 6.80% 1,670,692 77,970 6.22%
----------------------------------------------------------------------------------- --------------------------
Total interest-earning assets(1) .................. 10,383,402 $ 665,203 8.55% 9,570,316 $ 577,827 8.07%
----------------------------------------------------------------------------------- --------------------------
Nonearning assets ................................. 894,227 983,040
-------------------------------------------------------------------- -----------
Total assets .................................... $11,277,629 $10,553,356
----------------------------------------------------------------------------------------------------------------------------------
LIABILITIES AND SHAREHOLDERS' EQUITY:
Interest-bearing deposits ......................... $ 6,755,726 $ 256,576 5.07% $ 6,121,199 $ 200,900 4.39%
Short-term borrowings ............................. 1,466,470 68,375 6.23% 1,364,971 51,340 5.03%
Long-term debt .................................... 946,942 45,365 6.39% 917,506 41,943 6.11%
----------------------------------------------------------------------------------- --------------------------
Total interest-bearing liabilities ................ 9,169,138 $ 370,316 5.39% 8,403,676 $ 294,183 4.68%
----------------------------------------------------------------------------------- --------------------------
Noninterest-bearing demand deposits ............... 1,301,962 1,395,200
Other liabilities ................................. 105,232 87,185
----------- ------------
Total liabilities ................................. 10,576,332 9,886,061
Shareholders' equity .............................. 701,297 667,295
-------------------------------------------------------------------- -----------
Total liabilities and shareholders' equity .......... $11,277,629 $10,553,356
----------------------------------------------------------------------------------------------------------------------------------
RATE DIFFERENTIAL ................................... 3.16% 3.39%
NET YIELD ON INTEREST-EARNING ASSETS ................ $ 294,887 3.79% $ 283,644 3.96%
----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
----------------------
(1) Interest earned and average rates on obligations of states and
political subdivisions are reflected on a tax equivalent basis. Tax
equivalent interest earned is : actual interest earned times 145%. The
taxable equivalent adjustment has given effect to the disallowance of
interest expense deductions, for federal income tax purposes, related
to certain tax-free assets.
13
<PAGE> 14
THE COLONIAL BANCGROUP, INC. AND SUBSIDIARIES
NONPERFORMING ASSETS (UNAUDITED)
(Dollars in thousands)
<TABLE>
<CAPTION>
------------------------------------------------------------------------------------------------------------------------------
SEPTEMBER 30, DECEMBER 31, SEPTEMBER 30,
2000 1999 1999
------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Nonaccrual loans ............................................... $43,179 $34,461 $28,255
Restructured loans ............................................. 1,174 1,265 1,270
------------------------------------------------------------------------------------------------------------------------------
Total nonperforming loans .................................... 44,353 35,726 29,525
Other real estate owned and in substance foreclosures .......... 6,510 9,215 6,196
------------------------------------------------------------------------------------------------------------------------------
Total nonperforming assets ................................... $50,863 $44,941 $35,721
------------------------------------------------------------------------------------------------------------------------------
Aggregate loans contractually past due 90
days for which interest is being accrued ..................... $10,161 $11,184 $ 8,750
Net charge-offs (recoveries):
Quarter to date ........................................... $ 6,390 $ 4,998 $ 3,336
Year to date .............................................. 13,954 16,276 11,278
------------------------------------------------------------------------------------------------------------------------------
RATIOS
------------------------------------------------------------------------------------------------------------------------------
Period end:
Total nonperforming assets as a percent of
net loans and other real estate ............................ 0.56% 0.55% 0.45%
Allowance as a percent of net loans .......................... 1.14% 1.17% 1.17%
Allowance as a percent of nonperforming assets ............... 204% 214% 257%
Allowance as a percent of nonperforming loans ................ 234% 269% 311%
Net charge-offs as a percent of average
net loans (annualized basis):
Quarter to date ..................................... 0.29% 0.25% 0.17%
Year to date ........................................ 0.21% 0.21% 0.20%
------------------------------------------------------------------------------------------------------------------------------
</TABLE>
14
<PAGE> 15
SUPPLEMENTAL AND FORWARD LOOKING INFORMATION
NET INTEREST MARGIN
As stated above, Colonial's net interest margin has declined from 3.98% in
the third quarter 1999 to a 3.85% in the second quarter of 2000 and to 3.65% in
the third quarter of 2000. Outstanding loans increased 16% or $1.25 billion from
September 30, 1999 to September 30, 2000.
The impact of the margin decline has substantially offset the favorable impact
of Colonial's loan growth on net income. The 33 basis point decline in the net
interest margin is mainly due to (1) Federal Reserve rate increases, (2) strong
loan growth creating an increased funding need resulting in pressure on funding
costs, and (3) the shifting of customer deposits from non-interest and low cost
interest-bearing accounts to higher yields due to the current rate environment.
FUTURE EARNINGS OUTLOOK
The Company's outlook for future earnings will continue to be impacted by
historically low margins due to the current interest rate environment. In light
of this, Colonial expects to see an additional five to ten basis point decline
in the net interest margin in the fourth quarter 2000 where it is expected to
remain throughout 2001.
15
<PAGE> 16
Loans are expected to grow at a slower pace in 2001, with current projections in
the 10% to 12% range. Colonial's markets are still experiencing strong loan
demand, however a declining rate of growth is expected in consideration of the
potential for a slowdown in national economic growth.
The net impact of a compressed margin and lower loan growth would result in a
forecasted earnings per share of $.26 to $.27 for the fourth quarter 2000.
2001's earnings per share are estimated to be in the range of $1.12 to $1.18,
notwithstanding any currently unforeseen factors such as further short term
interest rate increases or increased credit erosion resulting in greater loan
losses.
Events which could positively impact this outlook include (1) greater loan
growth, (2) increased low cost deposit growth due to branch incentive programs,
promotions, etc. and (3) lower short term interest rates with an accompanying
positive yield curve.
16
<PAGE> 17
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
THE COLONIAL BANCGROUP, INC.
----------------------------
(Registrant)
<TABLE>
<S> <C> <C>
Date: October 18, 2000 /s/ W. Flake Oakley, IV
---------------------------------------
BY: W. Flake Oakley
ITS: Chief Financial Officer
</TABLE>
17
