Glacier Bancorp, Inc. — FY2022 Form 10-K
Reporting period: Fiscal year ended December 31, 2022. The filing also reports fourth-quarter results. Glacier Bancorp is a regional bank holding company operating through Glacier Bank, with 221 locations across eight western states.
Financial performance and condition
| Metric | FY2022 / year-end | Comparison |
|---|---|---|
| Total assets | $26.64 billion | Up 3% year over year |
| Net interest income | $788.4 million | Up 19% |
| Net income | $303.2 million | Up 6%; record annual net income |
| Diluted earnings per share | $2.74 | Down 4% from $2.86 |
| Net interest margin, tax-equivalent | 3.27% | Down 15 basis points |
| Non-interest income | $120.7 million | Down 17% |
| Non-interest expense | $518.9 million | Up 19%; efficiency ratio rose to 54.64% from 51.35% |
| Cash flow from operations | $470.7 million | Down from $572.0 million |
| Cash and cash equivalents | $402.0 million | Down from $437.7 million |
| Total deposits | $20.61 billion | Down 3%; core deposits down $736.8 million |
| Borrowings | $3.84 billion | Includes $1.80 billion of FHLB advances; none outstanding at prior year-end |
| Stockholders’ equity | $2.84 billion | Down 11%; book value per share fell to $25.67 from $28.71 |
Gross loans grew 14% to $15.25 billion; excluding PPP loans, management reported 15% growth. Commercial real estate loans were 65% of the portfolio. The loan-to-deposit ratio increased to 74.05% from 63.24%.
Provision for credit losses was $20.0 million. The loan allowance was $182.3 million, or 1.20% of loans, versus 1.29% a year earlier. Non-performing assets declined 52% to $32.7 million, or 0.12% of subsidiary assets. Net charge-offs increased to $7.8 million from $2.3 million.
Liquidity sources included $2.56 billion of available FHLB borrowing capacity, $1.68 billion available at the Federal Reserve discount window, $805 million of unsecured lines, and $6.25 billion of unencumbered debt securities. Estimated uninsured deposits were $6.23 billion.
Material changes and notable items
- Interest income rose 22%, reflecting the Alta acquisition completed in October 2021 and organic loan growth. Interest expense more than doubled to $41.3 million, largely due to higher borrowing costs and increased borrowings.
- Fourth-quarter net income was $79.7 million, compared with $50.7 million in fourth-quarter 2021. Fourth-quarter net interest income was $204.1 million; interest expense increased to $21.0 million from $5.2 million a year earlier.
- Income from loan sales fell $43.0 million, or 68%, as residential mortgage activity and gains moderated.
- Unrealized losses on available-for-sale securities drove a $496.2 million decline in accumulated other comprehensive income, leaving stockholders’ equity down despite retained earnings growth. The company reported no credit-loss allowance on its securities and attributed the unrealized declines primarily to interest rates and market spreads.
- The company transferred $2.2 billion of available-for-sale securities, with a $55.7 million unrealized net loss, to held-to-maturity during the first quarter of 2022. Held-to-maturity securities had a reported fair value about $440 million below amortized cost at year-end.
- 2022 cash dividends declared were $1.32 per share; no common-stock repurchases were made.
Outlook, risks and contingencies
The filing provides no specific earnings, growth, or margin guidance. Management says future performance will depend on regional economic conditions, interest rates, deposit and loan competition, credit quality and growth, acquisition integration, and regulatory requirements. The Federal Reserve raised its target rate seven times in 2022, a cumulative 425 basis points; management noted that rate changes can affect margins, funding costs, securities values, and equity.
Principal risks include the concentration of lending in commercial real estate and other real-estate-secured loans; possible deterioration in regional economies, property values, or borrower cash flows; deposit outflows and higher funding costs; interest-rate and securities valuation risk; and cybersecurity, technology, regulatory, acquisition, and climate-related risks. Management considered the loan allowance adequate, but the estimate depends on forecasts and other significant judgments.
Outstanding off-balance-sheet commitments totaled $4.83 billion, including $4.74 billion of unused credit lines and $88.9 million of letters of credit. The company recorded a $25.3 million allowance for off-balance-sheet credit exposures. Management said pending ordinary-course litigation was not expected to materially affect financial position, results, or liquidity. The independent auditor issued unqualified opinions on the financial statements and internal control over financial reporting.
Most important facts for investors to verify
- How deposit trends, uninsured balances, and deposit pricing affect liquidity and funding costs after the 2022 deposit decline and increase in FHLB borrowing.
- Whether loan growth—particularly in commercial real estate—remains supported by borrower performance, collateral values, and credit-quality trends.
- How securities losses, including the fair-value shortfall on held-to-maturity securities, may affect capital, liquidity flexibility, and future earnings.
- Whether margin and earnings trends persist as asset yields reprice and deposit and borrowing costs rise; the annual margin fell even as net interest income increased.
- How 2022 charge-offs, allowance coverage, and the substantial commercial real estate concentration evolve under changing economic conditions.
- The sustainability of dividends relative to earnings, regulatory capital, and the company’s access to dividends from the Bank.