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United Community Banks, Inc.
Symbol	UCBI
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United Community Banks, Inc. Announces Third Quarter Results

2018-10-23 17:00 ET - News Release

Continued Strong Profitability, EPS up 42% year over year

GREENVILLE, S.C., Oct. 23, 2018 (GLOBE NEWSWIRE) -- United Community Banks, Inc. (NASDAQ: UCBI) (“United”) realized strong third quarter results, with solid year-over-year loan and deposit growth, favorable efficiency levels and outstanding asset quality trends. Reported earnings per share were $0.54, an increase of 42 percent from a year ago. Excluding merger-related and other charges, earnings per share were $0.55, up 34 percent compared to last year. United also reported higher profitability ratios with increases in both return on assets and return on tangible equity.

During the quarter, United benefitted from strong core deposit growth, net interest margin expansion as well as strong mortgage and SBA production. Core transaction deposits were up $70 million and total customer deposits increased by $156 million during the quarter. Compared to last year, mortgage and SBA production increased 23 percent and 10 percent, respectively. Additionally, year-to-date SBA production is 39 percent higher than 2017. Navitas Credit Corporation, United’s equipment finance arm, continued to perform well and was a key growth driver for the quarter.

“I am pleased with our third quarter performance and continue to be optimistic about the balance of 2018,” said Lynn Harton, President and Chief Executive Officer of United. “Our new markets and investments continue to perform well and we have high expectations for the remainder of the year and beyond. We are pleased that we were able to exceed our return on assets target and are proud to have attained a 1.42 percent return on assets this quarter on an operating basis. I credit our outstanding team for this performance and am proud they were recognized for creating one of the “Best Banks to Work For” by American Banker for the second year in a row.”

Third Quarter 2018 Financial Highlights:

Return on assets of 1.41 percent, or 1.42 percent, excluding merger-related and other charges
Return on common equity of 12.0 percent
Return on tangible equity of 15.8 percent, excluding merger-related and other charges
Loan growth, excluding planned runoff of the indirect portfolio, of 2 percent on an annualized basis
Loan production of $778 million, as compared to $617 million in Q3 2017
Expansion of the net interest margin to 3.95 percent, up 5 basis points from the second quarter of 2018 and up 41 basis points from a year ago
Efficiency ratio of 56.8 percent, or 56.4 percent, excluding merger-related and other charges
Net charge offs of seven basis points, consistent with last quarter
Nonperforming assets of 0.19 percent of total assets, compared with 0.20 percent at June 30, 2018 and 0.23 percent at September 30, 2017

Conference Call

United will hold a conference call, Wednesday, October 24, 2018, at 11 a.m. ET to discuss the contents of this press release and to share business highlights for the quarter. To access the call, dial (877) 380-5665 and use the conference number 1270387. 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.



UNITED COMMUNITY BANKS, INC.
Financial Highlights
Selected Financial Information


		2018												2017							Third Quarter 2018-2017 Change				For the Nine Months Ended September 30,							YTD 2018-2017 Change
(in thousands, except per share data)		Third Quarter				Second Quarter				First Quarter				Fourth Quarter				Third Quarter			Third Quarter 2018-2017 Change				2018				2017			YTD 2018-2017 Change
INCOME SUMMARY
Interest revenue	$	128,721			$	122,215			$	115,290			$	106,757			$	98,839						$	366,226			$	282,963
Interest expense		16,611				13,739				12,005				9,249				9,064							42,355				24,486
Net interest revenue		112,110				108,476				103,285				97,508				89,775			25		%		323,871				258,477			25		%
Provision for credit losses		1,800				1,800				3,800				1,200				1,000							7,400				2,600
Noninterest income		24,180				23,340				22,396				21,928				20,573			18				69,916				66,332			5
Total revenue		134,490				130,016				121,881				118,236				109,348			23				386,387				322,209			20
Expenses		77,718				76,850				73,475				75,882				65,674			18				228,043				191,729			19
Income before income tax expense		56,772				53,166				48,406				42,354				43,674			30				158,344				130,480			21
Income tax expense		13,090				13,532				10,748				54,270				15,728			(17	)			37,370				50,743			(26	)
Net income (loss)		43,682				39,634				37,658				(11,916	)			27,946			56				120,974				79,737			52
Merger-related and other charges		592				2,873				2,646				7,358				3,420							6,111				7,304
Income tax benefit of merger-related and other charges		(141	)			(121	)			(628	)			(1,165	)			(1,147	)						(890	)			(2,580	)
Impact of remeasurement of deferred tax asset resulting from 2017 Tax Cuts and Jobs Act		-				-				-				38,199				-							-				-
Release of disproportionate tax effects lodged in OCI		-				-				-				-				-							-				3,400
Net income - operating ⁽¹⁾	$	44,133			$	42,386			$	39,676			$	32,476			$	30,219			46			$	126,195			$	87,861			44

PERFORMANCE MEASURES
Per common share:
Diluted net income (loss) - GAAP	$	0.54			$	0.49			$	0.47			$	(0.16	)		$	0.38			42			$	1.51			$	1.10			37
Diluted net income - operating ⁽¹⁾		0.55				0.53				0.50				0.42				0.41			34				1.57				1.21			30
Cash dividends declared		0.15				0.15				0.12				0.10				0.10			50				0.42				0.28			50
Book value		17.56				17.29				17.02				16.67				16.50			6				17.56				16.50			6
Tangible book value⁽³⁾		13.54				13.25				12.96				13.65				14.11			(4	)			13.54				14.11			(4	)

Key performance ratios:
Return on common equity - GAAP⁽²⁾⁽⁴⁾		11.96		%		11.20		%		11.11		%		(3.57	)	%		9.22		%					11.43		%		9.26		%
Return on common equity - operating^(1)(2)(4)		12.09				11.97				11.71				9.73				9.97							11.93				10.20
Return on tangible common equity - operating^(1)(2)(3)(4)		15.81				15.79				15.26				11.93				11.93							15.62				12.07
Return on assets - GAAP⁽⁴⁾		1.41				1.30				1.26				(0.40	)			1.01							1.32				0.99
Return on assets - operating⁽¹⁾⁽⁴⁾		1.42				1.39				1.33				1.10				1.09							1.38				1.09
Dividend payout ratio - GAAP		27.78				30.61				25.53				(62.50	)			26.32							27.81				25.45
Dividend payout ratio - operating ⁽¹⁾		27.27				28.30				24.00				23.81				24.39							26.75				23.14
Net interest margin (fully taxable equivalent)⁽⁴⁾		3.95				3.90				3.80				3.63				3.54							3.88				3.49
Efficiency ratio - GAAP		56.82				57.94				57.83				63.03				59.27							57.52				58.81
Efficiency ratio - operating ⁽¹⁾		56.39				55.77				55.75				56.92				56.18							55.98				56.57
Average equity to average assets		11.33				11.21				11.03				11.21				10.86							11.19				10.54
Average tangible equity to average assets⁽³⁾		8.97				8.83				8.82				9.52				9.45							8.88				9.21
Average tangible common equity to average assets⁽³⁾		8.97				8.83				8.82				9.52				9.45							8.88				9.21
Tangible common equity to risk-weighted assets⁽³⁾⁽⁵⁾		11.62				11.36				11.19				12.05				12.80							11.62				12.80
																									-
ASSET QUALITY
Nonperforming loans	$	22,530			$	21,817			$	26,240			$	23,658			$	22,921			(2	)		$	22,530			$	22,921			(2	)
Foreclosed properties		1,336				2,597				2,714				3,234				2,736			(51	)			1,336				2,736			(51	)
Total nonperforming assets (NPAs)		23,866				24,414				28,954				26,892				25,657			(7	)			23,866				25,657			(7	)
Allowance for loan losses		60,940				61,071				61,085				58,914				58,605			4				60,940				58,605			4
Net charge-offs		1,466				1,359				1,501				1,061				1,635			(10	)			4,326				4,937			(12	)
Allowance for loan losses to loans		0.74		%		0.74		%		0.75		%		0.76		%		0.81		%					0.74		%		0.81		%
Net charge-offs to average loans⁽⁴⁾		0.07				0.07				0.08				0.06				0.09							0.07				0.09
NPAs to loans and foreclosed properties		0.29				0.30				0.35				0.35				0.36							0.29				0.36
NPAs to total assets		0.19				0.20				0.24				0.23				0.23							0.19				0.23

AVERAGE BALANCES ($ in millions)
Loans	$	8,200			$	8,177			$	7,993			$	7,560			$	7,149			15			$	8,124			$	7,012			16
Investment securities		2,916				2,802				2,870				2,991				2,800			4				2,863				2,799			2
Earning assets		11,320				11,193				11,076				10,735				10,133			12				11,197				9,969			12
Total assets		12,302				12,213				12,111				11,687				10,980			12				12,209				10,788			13
Deposits		9,950				9,978				9,759				9,624				8,913			12				9,896				8,723			13
Shareholders’ equity		1,394				1,370				1,336				1,310				1,193			17				1,367				1,137			20
Common shares - basic (thousands)		79,806				79,753				79,205				76,768				73,151			9				79,588				72,060			10
Common shares - diluted (thousands)		79,818				79,755				79,215				76,768				73,162			9				79,598				72,071			10

AT PERIOD END ($ in millions)
Loans	$	8,226			$	8,220			$	8,184			$	7,736			$	7,203			14			$	8,226			$	7,203			14
Investment securities		2,873				2,834				2,731				2,937				2,847			1				2,873				2,847			1
Total assets		12,405				12,386				12,264				11,915				11,129			11				12,405				11,129			11
Deposits		10,229				9,966				9,993				9,808				9,127			12				10,229				9,127			12
Shareholders’ equity		1,402				1,379				1,357				1,303				1,221			15				1,402				1,221			15
Common shares outstanding (thousands)		79,202				79,138				79,123				77,580				73,403			8				79,202				73,403			8

⁽¹⁾ Excludes merger-related and other charges which includes amortization of certain executive change of control benefits, the fourth quarter 2017 impact of remeasurement of United's deferred tax assets following the passage of tax reform legislation and a first quarter 2017 release of disproportionate tax effects lodged in OCI. ⁽²⁾ Net income less 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 2018 ratio is preliminary.

UNITED COMMUNITY BANKS, INC.
Non-GAAP Performance Measures Reconciliation
Selected Financial Information

		2018												2017							For the Nine Months Ended
	Third				Second				First				Fourth				Third				For the Nine Months Ended
(in thousands, except per share data)	Quarter				Quarter				Quarter				Quarter				Quarter					2018				2017

Expense reconciliation
Expenses (GAAP)	$	77,718			$	76,850			$	73,475			$	75,882			$	65,674			$	228,043			$	191,729
Merger-related and other charges		(592	)			(2,873	)			(2,646	)			(7,358	)			(3,420	)			(6,111	)			(7,304	)
Expenses - operating	$	77,126			$	73,977			$	70,829			$	68,524			$	62,254			$	221,932			$	184,425

Net income reconciliation
Net income (loss) (GAAP)	$	43,682			$	39,634			$	37,658			$	(11,916	)		$	27,946			$	120,974			$	79,737
Merger-related and other charges		592				2,873				2,646				7,358				3,420				6,111				7,304
Income tax benefit of merger-related and other charges		(141	)			(121	)			(628	)			(1,165	)			(1,147	)			(890	)			(2,580	)
Impact of tax reform on remeasurement of deferred tax asset		-				-				-				38,199				-				-				-
Release of disproportionate tax effects lodged in OCI		-				-				-				-				-				-				3,400
Net income - operating	$	44,133			$	42,386			$	39,676			$	32,476			$	30,219			$	126,195			$	87,861
Diluted income per common share reconciliation
Diluted income (loss) per common share (GAAP)	$	0.54			$	0.49			$	0.47			$	(0.16	)		$	0.38			$	1.51			$	1.10
Merger-related and other charges		0.01				0.04				0.03				0.08				0.03				0.06				0.06
Impact of tax reform on remeasurement of deferred tax asset		-				-				-				0.50				-				-				-
Release of disproportionate tax effects lodged in OCI		-				-				-				-				-				-				0.05
Diluted income per common share - operating	$	0.55			$	0.53			$	0.50			$	0.42			$	0.41			$	1.57			$	1.21

Book value per common share reconciliation
Book value per common share (GAAP)	$	17.56			$	17.29			$	17.02			$	16.67			$	16.50			$	17.56			$	16.50
Effect of goodwill and other intangibles		(4.02	)			(4.04	)			(4.06	)			(3.02	)			(2.39	)			(4.02	)			(2.39	)
Tangible book value per common share	$	13.54			$	13.25			$	12.96			$	13.65			$	14.11			$	13.54			$	14.11

Return on tangible common equity reconciliation
Return on common equity (GAAP)		11.96		%		11.20		%		11.11		%		(3.57	)	%		9.22		%		11.43		%		9.26		%
Merger-related and other charges		0.13				0.77				0.60				1.86				0.75				0.50				0.55
Impact of tax reform on remeasurement of deferred tax asset		-				-				-				11.44				-				-				-
Release of disproportionate tax effects lodged in OCI		-				-				-				-				-				-				0.39
Return on common equity - operating		12.09				11.97				11.71				9.73				9.97				11.93				10.20
Effect of goodwill and other intangibles		3.72				3.82				3.55				2.20				1.96				3.69				1.87
Return on tangible common equity - operating		15.81		%		15.79		%		15.26		%		11.93		%		11.93		%		15.62		%		12.07		%

Return on assets reconciliation
Return on assets (GAAP)		1.41		%		1.30		%		1.26		%		(0.40	)	%		1.01		%		1.32		%		0.99		%
Merger-related and other charges		0.01				0.09				0.07				0.20				0.08				0.06				0.06
Impact of tax reform on remeasurement of deferred tax asset		-				-				-				1.30				-				-				-
Release of disproportionate tax effects lodged in OCI		-				-				-				-				-				-				0.04
Return on assets - operating		1.42		%		1.39		%		1.33		%		1.10		%		1.09		%		1.38		%		1.09		%

Dividend payout ratio reconciliation
Dividend payout ratio (GAAP)		27.78		%		30.61		%		25.53		%		(62.50	)	%		26.32		%		27.81		%		25.45		%
Merger-related and other charges		(0.51	)			(2.31	)			(1.53	)			12.04				(1.93	)			(1.06	)			(1.31	)
Impact of tax reform on remeasurement of deferred tax asset		-				-				-				74.27				-				-				-
Release of disproportionate tax effects lodged in OCI		-				-				-				-				-				-				(1.00	)
Dividend payout ratio - operating		27.27		%		28.30		%		24.00		%		23.81		%		24.39		%		26.75		%		23.14		%

Efficiency ratio reconciliation
Efficiency ratio (GAAP)		56.82		%		57.94		%		57.83		%		63.03		%		59.27		%		57.52		%		58.81		%
Merger-related and other charges		(0.43	)			(2.17	)			(2.08	)			(6.11	)			(3.09	)			(1.54	)			(2.24	)
Efficiency ratio - operating		56.39		%		55.77		%		55.75		%		56.92		%		56.18		%		55.98		%		56.57		%

Average equity to assets reconciliation
Equity to assets (GAAP)		11.33		%		11.21		%		11.03		%		11.21		%		10.86		%		11.19		%		10.54		%
Effect of goodwill and other intangibles		(2.36	)			(2.38	)			(2.21	)			(1.69	)			(1.41	)			(2.31	)			(1.33	)
Tangible common equity to assets		8.97		%		8.83		%		8.82		%		9.52		%		9.45		%		8.88		%		9.21		%

Tangible common equity to risk-weighted assets reconciliation ⁽¹⁾
Tier 1 capital ratio (Regulatory)		12.34		%		11.94		%		11.61		%		12.24		%		12.27		%		12.34		%		12.27		%
Effect of other comprehensive income		(0.68	)			(0.57	)			(0.50	)			(0.29	)			(0.13	)			(0.68	)			(0.13	)
Effect of deferred tax limitation		0.30				0.33				0.42				0.51				0.94				0.30				0.94
Effect of trust preferred		(0.34	)			(0.34	)			(0.34	)			(0.36	)			(0.24	)			(0.34	)			(0.24	)
Basel III intangibles transition adjustment		-				-				-				(0.05	)			(0.04	)			-				(0.03	)
Tangible common equity to risk-weighted assets		11.62		%		11.36		%		11.19		%		12.05		%		12.80		%		11.62		%		12.81		%

⁽¹⁾ Third quarter 2018 ratios are preliminary.

UNITED COMMUNITY BANKS, INC.
Financial Highlights
Loan Portfolio Composition at Period-End


		2018						2017			Linked Quarter Change			Year over Year Change
	Third		Second		First		Fourth		Third
(in millions)	Quarter		Quarter		Quarter		Quarter		Quarter
LOANS BY CATEGORY
Owner occupied commercial RE	$	1,673	$	1,682	$	1,898	$	1,924	$	1,792	$	(9	)	$	(119	)
Income producing commercial RE		1,788		1,821		1,677		1,595		1,413		(33	)		375
Commercial & industrial		1,194		1,193		1,142		1,131		1,084		1			110
Commercial construction		761		735		691		712		583		26			178
Equipment financing		509		465		423		-		-		44			509
Total commercial		5,925		5,896		5,831		5,362		4,872		29			1,053
Residential mortgage		1,035		1,021		992		974		933		14			102
Home equity lines of credit		702		708		712		731		689		(6	)		13
Residential construction		198		195		190		183		190		3			8
Consumer		366		400		459		486		519		(34	)		(153	)
Total loans	$	8,226	$	8,220	$	8,184	$	7,736	$	7,203		6			1,023

LOANS BY MARKET
North Georgia	$	992	$	1,001	$	1,004	$	1,019	$	1,047		(9	)		(55	)
Atlanta MSA		1,493		1,533		1,513		1,510		1,477		(40	)		16
North Carolina		1,078		1,067		1,037		1,049		542		11			536
Coastal Georgia		610		623		635		630		634		(13	)		(24	)
Gainesville MSA		235		230		231		248		242		5			(7	)
East Tennessee		460		474		473		475		471		(14	)		(11	)
South Carolina		1,586		1,571		1,537		1,486		1,470		15			116
Commercial Banking Solutions		1,530		1,444		1,438		961		920		86			610
Indirect auto		242		277		316		358		400		(35	)		(158	)
Total loans	$	8,226	$	8,220	$	8,184	$	7,736	$	7,203		6			1,023

UNITED COMMUNITY BANKS, INC.
Financial Highlights
Credit Quality


	Third Quarter 2018										Second Quarter 2018											First Quarter 2018
	Nonperforming			Foreclosed				Total			Nonperforming				Foreclosed			Total				Nonperforming			Foreclosed			Total
(in thousands)	Loans			Properties				NPAs			Loans				Properties			NPAs				Loans			Properties			NPAs
NONPERFORMING ASSETS BY CATEGORY
Owner occupied CRE	$	4,884		$	183			$	5,067		$	5,772			$	812		$	6,584			$	6,757		$	1,121		$	7,878
Income producing CRE		1,194			156				1,350			991				455			1,446				3,942			368			4,310
Commercial & industrial		1,516			-				1,516			2,180				-			2,180				1,917			-			1,917
Commercial construction		825			522				1,347			613				576			1,189				574			658			1,232
Equipment financing		1,181			-				1,181			1,075				-			1,075				428			-			428
Total commercial		9,600			861				0,461			10,631				1,843			12,474				13,618			2,147			15,765
Residential mortgage		8,928			424				9,352			7,918				184			8,102				8,724			232			8,956
Home equity lines of credit		2,814			-				2,814			1,812				550			2,362				2,149			335			2,484
Residential construction		455			51				506			637				20			657				378			-			378
Consumer		733			-				733			819				-			819				1,371			-			1,371
Total NPAs	$	22,530		$	1,336			$	23,866		$	21,817			$	2,597		$	24,414			$	26,240		$	2,714		$	28,954

NONPERFORMING ASSETS BY MARKET
North Georgia	$	7,170		$	361			$	7,531		$	7,583			$	640		$	8,223			$	8,519		$	85		$	8,604
Atlanta MSA		1,778			132				1,910			1,928				132			2,060				1,138			132			1,270
North Carolina		3,690			480				4,170			3,029				750			3,779				5,006			1,271			6,277
Coastal Georgia		1,498			-				1,498			943				-			943				1,887			-			1,887
Gainesville MSA		212			-				212			186				-			186				574			163			737
East Tennessee		1,403			128				1,531			1,473				143			1,616				1,511			10			1,521
South Carolina		3,280			235				3,515			3,093				362			3,455				3,443			483			3,926
Commercial Banking Solutions		2,871			-				2,871			2,831				570			3,401				2,937			570			3,507
Indirect auto		628			-				628			751				-			751				1,225			-			1,225
Total NPAs	$	22,530		$	1,336			$	23,866		$	21,817			$	2,597		$	24,414			$	26,240		$	2,714		$	28,954

NONPERFORMING ASSETS ACTIVITY
Beginning Balance	$	21,817		$	2,597			$	24,414		$	26,240			$	2,714		$	28,954			$	23,658		$	3,234		$	26,892
Acquisitions		-			-				-			-				-			-				428			-			428
Loans placed on non-accrual		5,759			-				5,759			3,612				-			3,612				7,463			-			7,463
Payments received		(3,095	)		-				(3,095	)		(5,314		)		-			(5,314		)		(3,534	)		-			(3,534	)
Loan charge-offs		(1,588	)		-				(1,588	)		(2,065		)		-			(2,065		)		(1,150	)		-			(1,150	)
Foreclosures		(363	)		454				91			(656		)		984			328				(625	)		625			-
Property sales		-			(1,659		)		(1,659	)		-				(1,029	)		(1,029		)		-			(957	)		(957	)
Write downs		-			(166		)		(166	)		-				(106	)		(106		)		-			(72	)		(72	)
Net gains (losses) on sales		-			110				110			-				34			34				-			(116	)		(116	)
Ending Balance	$	22,530		$	1,336			$	23,866		$	21,817			$	2,597		$	24,414			$	26,240		$	2,714		$	28,954

	Third Quarter 2018							Second Quarter 2018							First Quarter 2018
				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	$	(251	)	(.06)		%		$	(578	)	(.13)		%		$	(43	)	(.01)		%
Income producing CRE		1			-				1,421		.33					422		.10
Commercial & industrial		418		.14					16		.01					(3	)		-
Commercial construction		(43	)	(.02)					(107	)	(.06)					266		.15
Equipment financing		482		.39					(49	)	(.04)					40		.08
Total commercial		607		.04					703		.05					682		.05
Residential mortgage		171		.07					11			-				(52	)	(.02)
Home equity lines of credit		279		.16					21		.01					89		.05
Residential construction		(164	)	(.33)					(58	)	(.12)					(64	)	(.14)
Consumer		573		.60					682		.64					846		.72
Total	$	1,466		.07				$	1,359		.07				$	1,501		.08

NET CHARGE-OFFS BY MARKET
North Georgia	$	483		.19		%		$	246		.10		%		$	772		.31		%
Atlanta MSA		99		.03					103		.03					(109	)	(.03)
North Carolina		(87	)	(.03)					1,268		.48					144		.06
Coastal Georgia		24		.02					19		.01					137		.09
Gainesville MSA		(48	)	(.08)					(2	)		-				(18	)	(.03)
East Tennessee		(1	)		-				76		.06					31		.03
South Carolina		418		.11					(1,057	)	(.27)					12			-
Commercial Banking Solutions		403		.11					381		.11					176		.06
Indirect auto		175		.27					325		.44					356		.41
Total	$	1,466		.07				$	1,359		.07				$	1,501		.08

⁽¹⁾ Annualized.


UNITED COMMUNITY BANKS, INC.
Consolidated Statements of Income (Unaudited)

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(in thousands, except per share data)		2018		2017		2018			2017

Interest revenue:
Loans, including fees	$	108,335	$	80,264	$	308,296		$	227,816
Investment securities, including tax exempt of $1,052, $671, $3,049, and $1,307		19,899		17,875		56,448			53,365
Deposits in banks and short-term investments		487		700		1,482			1,782
Total interest revenue		128,721		98,839		366,226			282,963

Interest expense:
Deposits:
NOW and interest-bearing demand		1,901		700		4,317			1,932
Money market		3,261		1,953		8,019			4,938
Savings		33		34		117			89
Time		5,746		1,870		12,900			4,257
Total deposit interest expense		10,941		4,557		25,353			11,216
Short-term borrowings		274		36		772			177
Federal Home Loan Bank advances		1,791		1,709		5,551			4,603
Long-term debt		3,605		2,762		10,679			8,490
Total interest expense		16,611		9,064		42,355			24,486
Net interest revenue		112,110		89,775		323,871			258,477
Provision for credit losses		1,800		1,000		7,400			2,600
Net interest revenue after provision for credit losses		110,310		88,775		316,471			255,877

Noninterest income:
Service charges and fees		9,112		8,220		26,831			29,525
Mortgage loan and other related fees		5,262		4,200		15,928			13,435
Brokerage fees		1,525		1,009		3,598			3,565
Gains from sales of SBA/USDA loans		2,605		2,806		6,784			7,391
Securities gains (losses), net		2		188		(1,302	)		190
Other		5,674		4,150		18,077			12,226
Total noninterest income		24,180		20,573		69,916			66,332
Total revenue		134,490		109,348		386,387			322,209

Noninterest expenses:
Salaries and employee benefits		47,146		38,027		135,384			112,056
Communications and equipment		5,590		4,547		15,071			14,443
Occupancy		5,779		4,945		16,939			14,802
Advertising and public relations		1,442		1,026		4,341			3,347
Postage, printing and supplies		1,574		1,411		4,896			4,127
Professional fees		3,927		2,976		11,435			8,391
FDIC assessments and other regulatory charges		2,228		2,127		6,677			4,758
Amortization of intangibles		1,681		1,212		5,426			3,085
Merger-related and other charges		115		3,176		4,449			7,060
Other		8,236		6,227		23,425			19,660
Total noninterest expenses		77,718		65,674		228,043			191,729
Net income before income taxes		56,772		43,674		158,344			130,480
Income tax expense		13,090		15,728		37,370			50,743
Net income	$	43,682	$	27,946	$	120,974		$	79,737

Net income available to common shareholders	$	43,381	$	27,719	$	120,124		$	79,078

Earnings per common share:
Basic	$	0.54	$	0.38	$	1.51		$	1.10
Diluted		0.54		0.38		1.51			1.10
Weighted average common shares outstanding:
Basic		79,806		73,151		79,588			72,060
Diluted		79,818		73,162		79,598			72,071


UNITED COMMUNITY BANKS, INC.
Consolidated Balance Sheets (Unaudited)

	September 30,			December 31,
(in thousands, except share and per share data)		2018			2017

ASSETS
Cash and due from banks	$	115,509		$	129,108
Interest-bearing deposits in banks		196,459			185,167
Cash and cash equivalents		311,968			314,275
Securities available for sale		2,587,559			2,615,850
Securities held to maturity (fair value $277,473 and $321,276)		285,739			321,094
Loans held for sale (includes $27,325 and $26,252 at fair value)		27,325			32,734
Loans and leases, net of unearned income		8,226,466			7,735,572
Less allowance for loan and lease losses		(60,940	)		(58,914	)
Loans, net		8,165,526			7,676,658
Premises and equipment, net		204,080			208,852
Bank owned life insurance		191,582			188,970
Accrued interest receivable		33,562			32,459
Net deferred tax asset		76,944			88,049
Derivative financial instruments		29,895			22,721
Goodwill and other intangible assets		325,493			244,397
Other assets		165,459			169,401
Total assets	$	12,405,132		$	11,915,460
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
Deposits:
Noninterest-bearing demand	$	3,296,908		$	3,087,797
NOW and interest-bearing demand		2,075,479			2,131,939
Money market		2,060,671			2,016,748
Savings		680,421			651,742
Time		1,564,640			1,548,460
Brokered		551,358			371,011
Total deposits		10,229,477			9,807,697
Short-term borrowings		-			50,000
Federal Home Loan Bank advances		300,000			504,651
Long-term debt		285,128			120,545
Derivative financial instruments		39,116			25,376
Accrued expenses and other liabilities		149,529			103,857
Total liabilities		11,003,250			10,612,126
Shareholders' equity:
Common stock, $1 par value; 150,000,000 shares authorized;
79,202,479 and 77,579,561 shares issued and outstanding		79,202			77,580
Common stock issuable; 650,338 and 607,869 shares		10,171			9,083
Capital surplus		1,498,199			1,451,814
Accumulated deficit		(122,679	)		(209,902	)
Accumulated other comprehensive loss		(63,011	)		(25,241	)
Total shareholders' equity		1,401,882			1,303,334
Total liabilities and shareholders' equity	$	12,405,132		$	11,915,460

UNITED COMMUNITY BANKS, INC.
Average Consolidated Balance Sheets and Net Interest Analysis
For the Three Months Ended September 30,

	2018							2017
	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⁾	$	8,199,856		$	108,197	5.23	%	$	7,149,348		$	80,301	4.46	%
Taxable securities ⁽³⁾		2,763,461			18,847	2.73			2,695,162			17,204	2.55
Tax-exempt securities (FTE) ⁽¹⁾⁽³⁾		152,939			1,417	3.71			105,151			1,098	4.18
Federal funds sold and other interest-earning assets		203,707			751	1.47			183,170			883	1.93
Total interest-earning assets (FTE)		11,319,963			129,212	4.53			10,132,831			99,486	3.90
Noninterest-earning assets:
Allowance for loan losses		(62,322	)						(60,098	)
Cash and due from banks		123,290							103,477
Premises and equipment		216,775							203,579
Other assets ⁽³⁾		703,915							599,725
Total assets	$	12,301,621						$	10,979,514

Liabilities and Shareholders' Equity:
Interest-bearing liabilities:
Interest-bearing deposits:
NOW and interest-bearing demand	$	1,874,397			1,901	0.40		$	1,863,160			700	0.15
Money market		2,167,031			3,261	0.60			2,170,148			1,953	0.36
Savings		680,640			33	0.02			593,823			34	0.02
Time		1,545,020			3,351	0.86			1,338,786			1,548	0.46
Brokered time deposits		434,182			2,395	2.19			109,811			322	1.16
Total interest-bearing deposits		6,701,270			10,941	0.65			6,075,728			4,557	0.30

Federal funds purchased and other borrowings		50,767			274	2.14			11,313			36	1.26
Federal Home Loan Bank advances		331,413			1,791	2.14			574,404			1,709	1.18
Long-term debt		296,366			3,605	4.83			154,616			2,762	7.09
Total borrowed funds		678,546			5,670	3.32			740,333			4,507	2.42

Total interest-bearing liabilities		7,379,816			16,611	0.89			6,816,061			9,064	0.53
Noninterest-bearing liabilities:
Noninterest-bearing deposits		3,249,218							2,837,378
Other liabilities		278,764							133,212
Total liabilities		10,907,798							9,786,651
Shareholders' equity		1,393,823							1,192,863
Total liabilities and shareholders' equity	$	12,301,621						$	10,979,514

Net interest revenue (FTE)				$	112,601						$	90,422
Net interest-rate spread (FTE)						3.64	%						3.37	%

Net interest margin (FTE) ⁽⁴⁾						3.95	%						3.54	%

⁽¹⁾ Interest revenue on tax-exempt securities and loans has been increased to reflect comparable interest on taxable securities and loans. The rate used was 26% in 2018 and 39% in 2017, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate.
⁽²⁾ Included in the average balance of loans outstanding are loans where the accrual of interest has been discontinued and loans that are held for sale.
⁽³⁾ Securities available for sale are shown at amortized cost. Pretax unrealized losses of $49.9 million in 2018 and pretax unrealized gains of $12.6 million in 2017 are included in other assets for purposes of this presentation.
⁽⁴⁾ Net interest margin is taxable equivalent net-interest revenue divided by average interest-earning assets.


UNITED COMMUNITY BANKS, INC.
Average Consolidated Balance Sheets and Net Interest Analysis
For the Nine Months Ended September 30,

	2018							2017
	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⁾	$	8,124,269		$	307,981	5.07	%	$	7,011,962		$	227,853	4.34	%
Taxable securities ⁽³⁾		2,712,900			53,399	2.62			2,731,081			52,058	2.54
Tax-exempt securities (FTE) ⁽¹⁾⁽³⁾		150,014			4,106	3.65			68,005			2,139	4.19
Federal funds sold and other interest-earning assets		209,836			2,123	1.35			157,582			2,290	1.94

Total interest-earning assets (FTE)		11,197,019			367,609	4.39			9,968,630			284,340	3.81
Noninterest-earning assets:
Allowance for loan losses		(61,259	)						(60,971	)
Cash and due from banks		138,809							102,529
Premises and equipment		217,339							195,576
Other assets ⁽³⁾		717,555							582,194
Total assets	$	12,209,463						$	10,787,958

Liabilities and Shareholders' Equity:
Interest-bearing liabilities:
Interest-bearing deposits:
NOW and interest-bearing demand	$	2,009,029			4,317	0.29		$	1,907,889			1,932	0.14
Money market		2,203,677			8,019	0.49			2,100,296			4,938	0.31
Savings		671,883			117	0.02			576,927			89	0.02
Time		1,534,823			8,288	0.72			1,292,521			3,499	0.36
Brokered time deposits		298,653			4,612	2.06			106,753			758	0.95
Total interest-bearing deposits		6,718,065			25,353	0.50			5,984,386			11,216	0.25

Federal funds purchased and other borrowings		58,144			772	1.78			22,525			177	1.05
Federal Home Loan Bank advances		392,227			5,551	1.89			616,388			4,603	1.00
Long-term debt		295,966			10,679	4.82			168,271			8,490	6.75
Total borrowed funds		746,337			17,002	3.05			807,184			13,270	2.20
Total interest-bearing liabilities		7,464,402			42,355	0.76			6,791,570			24,486	0.48
Noninterest-bearing liabilities:
Noninterest-bearing deposits		3,178,387							2,738,118
Other liabilities		199,848							121,672
Total liabilities		10,842,637							9,651,360
Shareholders' equity		1,366,826							1,136,598
Total liabilities and shareholders' equity	$	12,209,463						$	10,787,958

Net interest revenue (FTE)				$	325,254						$	259,854
Net interest-rate spread (FTE)						3.63	%						3.33	%

Net interest margin (FTE) ⁽⁴⁾						3.88	%						3.49	%

⁽¹⁾ Interest revenue on tax-exempt securities and loans has been increased to reflect comparable interest on taxable securities and loans. The rate used was 26% in 2018 and 39% in 2017, reflecting the statutory federal income tax rate and the federal tax adjusted state income tax rate.
⁽²⁾ Included in the average balance of loans outstanding are loans where the accrual of interest has been discontinued and loans that are held for sale.
⁽³⁾ Securities available for sale are shown at amortized cost. Pretax unrealized losses of $40.4 million in 2018 and pretax unrealized gains of $4.67 million in 2017 are included in other assets for purposes of this presentation.
⁽⁴⁾ Net interest margin is taxable equivalent net-interest revenue divided by average interest-earning assets.

About United Community Banks, Inc.

United Community Banks, Inc. (NASDAQ: UCBI) is a bank holding company headquartered in Blairsville, Georgia with $12.4 billion in assets. The company’s banking subsidiary, United Community Bank, is one of the southeast region’s largest full-service banks, operating 150 offices in Georgia, North Carolina, South Carolina and Tennessee at the end of the most recent quarter. 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 five years, J.D. Power has ranked United Community Bank first in customer satisfaction in the Southeast. In 2018, for the fifth 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 Measures

This press 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 common share,” “operating earnings per 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.

Caution About Forward-Looking Statements

Certain statements in this press release may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that include projections, predictions, expectations, or beliefs about future events or results or otherwise and are not statements of historical fact. Such statements are often characterized by the use of qualified words (and their derivatives) such as “may,” “believe,” “expect,” “anticipate,” “intend,” “will,” “should,” “plan,” “estimate,” “predict,” “continue” and “potential” or the negative of these terms or words of similar meaning or other statements concerning opinions or judgments of United and its management about future events. Although United believes that its expectations with respect to forward-looking statements are based upon reasonable assumptions within the bounds of its existing knowledge of its business and operations, there can be no assurance that actual results, performance, or achievements of United will not differ materially from any future results, performance, or achievements expressed or implied by such forward-looking statements; such statements are not guarantees of future performance. Forward-looking statements are subject to numerous assumptions, risks and uncertainties that change over time and could cause actual results or financial condition to differ materially from those expressed in or implied by such statements. Actual future results and trends may differ materially from historical results and or those anticipated depending on a variety of factors, including, but not limited to the factors and risk influences contained in the cautionary language included under the headings “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” in United’s Form 10-K for the year ended December 31, 2017 and other periodic reports subsequently filed by United with the SEC, available on the SEC website, www.sec.gov. For any forward-looking statements made in this press release, United claims the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995.

For more information:
Jefferson Harralson
Chief Financial Officer
(864) 240-6208
Jefferson_Harralson@ucbi.com