President andCEO Raymond Davis said July 21 that the company is currently not interested in pursuingbank acquisitions.
Davis,who is slated to becomethe company's executive chair at the beginning of 2017, has led the company througha series of acquisitions since the credit crisis, including the transformationalpurchase of Sterling Financialin the spring of 2014. Davis said on a conference call to discuss second-quarterresults that bank acquisitions are not that attractive to the company right nowand noted that it plans to focus on organic growth.
Davissaid the company would take a look at bank acquisitions that came across his desk,but noted that he asks people why he would want to buy a bank in the current environment.
He saidthat a bank would have to be "strategically over the top" and "makea lot of sense" for Umpqua to get excited about a potential deal.
UmpquaCFO Ronald Farnsworth Jr. added that the company considers how to best allocatecapital and currently sees strong organic growth opportunities in the market.
In thesecond quarter, Umpqua grewits loan and lease portfolio by 9%, annualized. Umpqua Bank President Cort O'Haversaid on the call that the company's loan pipelines remain robust.
Withthe loan growth, the company's loan-to-deposit ratio rose to 95.1% by the end ofthe second quarter, up from 93.4% in the linked quarter. Davis said the companyis looking to grow its deposit base and expects stronger growth in the second halfof 2016, noting that Umpqua has been labeled a deposit making machine.
"Wehave all kinds of promotions, campaigns internal to the organization. I would rather[incentivize] my people versus raising rates, which we're not going to do,"Davis said on the call.
In thesecond quarter, Umpqua reported net income available to common shareholders of $54.3million, or 25 cents per share, compared to $54.7 million, or 25 cents per sharea year earlier.
The S&PCapital IQ consensus normalized EPS estimate for the recent quarter was 29 centsper share.