UNITED STATES
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) April 23, 2015 

____________________________________________________________
Glacier Bancorp, Inc.
(Exact name of registrant as specified in its charter)

Montana
000-18911
81-0519541
(State or other jurisdiction
of incorporation)
(Commission File Number)
(IRS Employer Identification No.)

49 Commons Loop, Kalispell, Montana
59901
(Address of principal executive offices)
(Zip Code)

(406) 756-4200
Registrant's telephone number, including area code

Not Applicable
(Former name or former address, if changed since last report)

____________________________________________________________

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
[   ]
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
 
[   ]
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
 
[   ]
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
 
[   ]
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))





Item 2.02. Results of Operations and Financial Condition

On April 23, 2015, the Company issued a press release announcing its financial results for the quarter ended March 31, 2015. A copy of the press release is attached as Exhibit 99.1 and is incorporated herein in its entirety by reference.

The information in this Item 2.02 and the Exhibit attached hereto is furnished and shall not be deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such document or filing.

Item 9.01. Financial Statements and Exhibits

(a)    Financial statements of businesses acquired - not applicable.

(b)    Pro forma financial information - not applicable.

(d)
Exhibit 99.1 - Press Release dated April 23, 2015, announcing financial results for the quarter ended March 31, 2015.


SIGNATURE

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.
 
 
Glacier Bancorp, Inc.
 
 
(Registrant)
April 23, 2015
 
/s/   MICHAEL J. BLODNICK
(Date)
 
Michael J. Blodnick
President and Chief Executive Officer








NEWS RELEASE

FOR IMMEDIATE RELEASE
CONTACT: Michael J. Blodnick
(406) 751-4701
Ron J. Copher
(406) 751-7706

GLACIER BANCORP, INC. ANNOUNCES
RESULTS FOR THE QUARTER ENDED MARCH 31, 2015

HIGHLIGHTS:
•
Net income of $27.7 million for the current quarter, an increase of 4 percent from the prior year first quarter net income of $26.7 million.
•
Current quarter diluted earnings per share of $0.37, an increase of 3 percent from the prior year first quarter diluted earnings per share of $0.36.
•
Net interest margin as a percentage of earning assets, on a tax-equivalent basis, for the current quarter was 4.03 percent, an increase of 11 basis points from the prior quarter net interest margin of 3.92 percent.
•
Excluding the acquisition, the loan portfolio increased $115 million, or 10 percent annualized, during the current quarter.
•
Dividend declared of $0.18 per share. The dividend was the 120th consecutive quarterly dividend declared by the Company.
•
Completed the acquisition of Community Bank, Inc., a community bank based in Ronan, Montana.

Results Summary
 
Three Months ended
(Dollars in thousands, except per share data)
Mar 31,
2015
 
Dec 31,
2014
 
Mar 31,
2014
Net income
$
27,670

 
28,054

 
26,730

Diluted earnings per share
$
0.37

 
0.37

 
0.36

Return on average assets (annualized)
1.36
%
 
1.37
%
 
1.39
%
Return on average equity (annualized)
10.72
%
 
10.66
%
 
11.04
%

KALISPELL, MONTANA, April 23, 2015 - Glacier Bancorp, Inc. (Nasdaq: GBCI) reported net income of $27.7 million for the current quarter, an increase of $940 thousand, or 4 percent, from the $26.7 million of net income for the prior year first quarter. Diluted earnings per share for the current quarter was $0.37 per share, an increase of $0.01, or 3 percent, from the prior year first quarter diluted earnings per share of $0.36. Included in the current quarter non-interest expense was $675 thousand of one-time acquisition and conversion related expenses and

1


included in the current quarter was non-interest income of $336 thousand from insurance proceeds on a bank-owned life insurance policy. “It was a nice start to the year on a number of fronts,” said Mick Blodnick, President and Chief Executive Officer. “Our growth in organic loans was one of the best we have ever produced in the first quarter of a year. In addition, we were very pleased with the improvement this past quarter to our net interest margin along with much better fee income compared to last year's first quarter. Collectively, they should give us additional earnings strength to carry us through the next three quarters,” Blodnick said.
 
On February 28, 2015, the Company completed the acquisition of Montana Community Banks, Inc. and its subsidiary, Community Bank, Inc. (“CB”). The Company incurred $595 thousand of legal and professional expenses in connection with the CB acquisition during the current quarter. Goodwill of $1.1 million resulted from the acquisition which was based on the estimated fair value of the assets acquired and liabilities assumed. “It was exciting to close the Montana Community Banks, Inc. transaction this quarter,” Blodnick said. “We can't thank the Olsson family and the entire staff enough for their cooperation throughout the process and believe this will be another excellent addition to our Company,” Blodnick said.

The Company’s results of operations and financial condition include the acquisition of CB from the acquisition date and the following table provides information on the fair value of selected classifications of assets and liabilities acquired:

(Dollars in thousands)
February 28,
2015
Total assets
$
175,774

Investment securities
42,350

Loans receivable
84,689

Non-interest bearing deposits
41,779

Interest bearing deposits
105,041

Federal Home Loan Bank advances and other borrowed funds
3,292



2


Asset Summary
 
 
 
 
 
 
 
$ Change from
(Dollars in thousands)
Mar 31,
2015
 
Dec 31,
2014
 
Mar 31,
2014
 
Dec 31,
2014
 
Mar 31,
2014
Cash and cash equivalents
$
183,466

 
442,409

 
161,691

 
(258,943
)
 
21,775

Investment securities, available-for-sale
2,544,093

 
2,387,428

 
2,669,180

 
156,665

 
(125,087
)
Investment securities, held-to-maturity
570,285

 
520,997

 
481,476

 
49,288

 
88,809

Total investment securities
3,114,378

 
2,908,425

 
3,150,656

 
205,953

 
(36,278
)
Loans receivable
 
 
 
 
 
 
 
 
 
Residential real estate
637,465

 
611,463

 
580,306

 
26,002

 
57,159

Commercial
3,426,016

 
3,263,448

 
2,928,995

 
162,568

 
497,021

Consumer and other
624,188

 
613,184

 
579,328

 
11,004

 
44,860

Loans receivable
4,687,669

 
4,488,095

 
4,088,629

 
199,574

 
599,040

Allowance for loan and lease losses
(129,856
)
 
(129,753
)
 
(130,729
)
 
(103
)
 
873

Loans receivable, net
4,557,813

 
4,358,342

 
3,957,900

 
199,471

 
599,913

Other assets
619,439

 
597,331

 
560,476

 
22,108

 
58,963

Total assets
$
8,475,096

 
8,306,507

 
7,830,723

 
168,589

 
644,373


Total investment securities increased $206 million, or 7 percent, during the current quarter and decreased $36 million, or 1 percent, from March 31, 2014. The increase in the investment portfolio during the current quarter was the result of the Company redeploying excess liquidity into higher yielding investment securities. Investment securities represented 37 percent of total assets at March 31, 2015 compared to 35 percent at December 31, 2014 and 40 percent at March 31, 2014.

Excluding the loans receivable from the acquisition of CB, the loan portfolio increased by $115 million, or 10 percent annualized, during the current quarter with improvement in all loan categories including a $96.8 million increase in commercial loans. Excluding the CB acquisition and the First National Bank of the Rockies (“FNBR”) acquisition in August 2014, the loan portfolio increased $377 million, or 9 percent, since March 31, 2014 with increases in all loan categories of which $314 million of the increase came from growth in commercial loans. “With the start we've given ourselves, achieving our goal of six percent loan growth this year is now certainly within reason,” Blodnick said. “We knew we carried some good loan momentum into 2015; nevertheless, we were thrilled with this level of loan growth considering it’s historically our weakest quarter,” Blodnick said.


3


Credit Quality Summary
 
At or for the Three Months ended
 
At or for the Year ended
 
At or for the Three Months ended
(Dollars in thousands)
March 31,
2015
 
December 31,
2014
 
March 31,
2014
Allowance for loan and lease losses
 
 
 
 
 
Balance at beginning of period
$
129,753

 
130,351

 
130,351

Provision for loan losses
765

 
1,912

 
1,122

Charge-offs
(1,297
)
 
(7,603
)
 
(1,586
)
Recoveries
635

 
5,093

 
842

Balance at end of period
$
129,856

 
129,753

 
130,729

Other real estate owned
$
28,124

 
27,804

 
27,332

Accruing loans 90 days or more past due
2,357

 
214

 
569

Non-accrual loans
60,287

 
61,882

 
78,905

Total non-performing assets 1
$
90,768

 
89,900

 
106,806

Non-performing assets as a percentage of subsidiary assets
1.07
%
 
1.08
%
 
1.37
%
Allowance for loan and lease losses as a percentage of non-performing loans
207
%
 
209
%
 
164
%
Allowance for loan and lease losses as a percentage of total loans
2.77
%
 
2.89
%
 
3.20
%
Net charge-offs as a percentage of total loans
0.01
%
 
0.06
%
 
0.02
%
Accruing loans 30-89 days past due
$
33,450

 
25,904

 
42,862

Accruing troubled debt restructurings
$
69,397

 
69,129

 
77,311

Non-accrual troubled debt restructurings
$
34,237

 
33,714

 
37,113

__________ 
1 As of March 31, 2015, non-performing assets have not been reduced by U.S. government guarantees of $4.1 million.

Non-performing assets at March 31, 2015 were $90.8 million, an increase of $868 thousand, or less than 1 percent, during the current quarter which was the result of the CB acquisition. Non-performing assets at March 31, 2015 decreased $16.0 million, or 15 percent, from a year ago. Land, lot and other construction loans (i.e., regulatory classification) continues to be the largest category and was $45.6 million, or 50 percent, of the non-performing assets at March 31, 2015. The Company has continued to make progress by reducing this category the past few years and the category decreased $2.1 million, or 4 percent, from the prior quarter. Early stage delinquencies (accruing loans 30-89 days past due) of $33.5 million at March 31, 2015 increased $7.5 million from the prior quarter and decreased $9.4 million from the prior year first quarter.

The allowance for loan and lease losses (“allowance”) was $130 million at March 31, 2015 and continued to remain stable compared to the prior periods. The allowance was 2.77 percent of total loans outstanding at March 31, 2015 compared to 2.89 percent at December 31, 2014 and 3.20 percent for the same quarter last year. The reduction in the allowance as a percentage of total loans was driven primarily by loan growth, stabilizing credit quality, and no allowance carried over from bank acquisitions as a result of the acquired loans recorded at fair value.


4


Credit Quality Trends and Provision for Loan Losses
(Dollars in thousands)
Provision
for Loan
Losses
 
Net
Charge-Offs
 
ALLL
as a Percent
of Loans
 
Accruing
Loans 30-89
Days Past Due
as a Percent of
Loans
 
Non-Performing
Assets to
Total Subsidiary
Assets
First quarter 2015
$
765

 
$
662

 
2.77
%
 
0.71
%
 
1.07
%
Fourth quarter 2014
191

 
1,070

 
2.89
%
 
0.58
%
 
1.08
%
Third quarter 2014
360

 
364

 
2.93
%
 
0.39
%
 
1.21
%
Second quarter 2014
239

 
332

 
3.11
%
 
0.44
%
 
1.30
%
First quarter 2014
1,122

 
744

 
3.20
%
 
1.05
%
 
1.37
%
Fourth quarter 2013
1,802

 
2,216

 
3.21
%
 
0.79
%
 
1.39
%
Third quarter 2013
1,907

 
2,025

 
3.27
%
 
0.66
%
 
1.56
%
Second quarter 2013
1,078

 
1,030

 
3.56
%
 
0.60
%
 
1.64
%

Net charged-off loans for the current quarter were $662 thousand, a decrease of $408 thousand from the prior quarter and a decrease of $82 thousand from the prior year first quarter. The current quarter provision for loan losses of $765 thousand increased $574 thousand from the prior quarter and decreased $357 thousand from the prior year first quarter. Loan portfolio growth, composition, average loan size, credit quality considerations, and other environmental factors will continue to determine the level of provision for loan loss expense. 

Supplemental information regarding credit quality and identification of the Company’s loan portfolio based on regulatory classification is provided in the exhibits at the end of this press release. The regulatory classification of loans is based primarily on collateral type while the Company’s loan segments presented herein are based on the purpose of the loan.

Liability Summary
 
 
 
 
 
 
 
$ Change from
(Dollars in thousands)
Mar 31,
2015
 
Dec 31,
2014
 
Mar 31,
2014
 
Dec 31,
2014
 
Mar 31,
2014
Non-interest bearing deposits
$
1,675,451

 
1,632,403

 
1,396,272

 
43,048

 
279,179

Interest bearing deposits
4,783,341

 
4,712,809

 
4,228,193

 
70,532

 
555,148

Repurchase agreements
425,652

 
397,107

 
327,322

 
28,545

 
98,330

Federal Home Loan Bank advances
298,148

 
296,944

 
686,744

 
1,204

 
(388,596
)
Other borrowed funds
6,703

 
7,311

 
8,069

 
(608
)
 
(1,366
)
Subordinated debentures
125,741

 
125,705

 
125,597

 
36

 
144

Other liabilities
106,536

 
106,181

 
73,566

 
355

 
32,970

Total liabilities
$
7,421,572

 
7,278,460

 
6,845,763

 
143,112

 
575,809


Excluding the acquisition of CB, non-interest bearing deposits at March 31, 2015 increased $1.3 million, or less than 1 percent, during the current quarter. Excluding the CB and FNBR acquisitions, non-interest bearing deposits increased $157 million, or 11 percent, from March 31, 2014. Interest bearing deposits of $4.783 billion at March 31, 2015 included $211 million of wholesale deposits (i.e., brokered deposits classified as NOW, money market deposits and certificate accounts). Excluding the CB acquisition and the decrease of $37.8 million in wholesale deposits, interest bearing deposits at March 31, 2015 increased $3.3 million, or less than 1 percent, during the current quarter. Excluding the CB and FNBR acquisitions and an increase of $32.9 million in wholesale deposits, interest bearing deposits at March 31, 2015 increased $188 million, or 5 percent, from a year ago. Federal Home Loan Bank (“FHLB”) advances of $298 million at March 31, 2015 increased $1.2 million, or less than 1 percent,

5


during the current quarter and decreased $389 million, or 57 percent, from March 31, 2014 as growth in deposits and continued balance sheet restructuring reduce the need for additional borrowings.

Stockholders’ Equity Summary
 
 
 
 
 
 
 
$ Change from
(Dollars in thousands, except per share data)
Mar 31,
2015
 
Dec 31,
2014
 
Mar 31,
2014
 
Dec 31,
2014
 
Mar 31,
2014
Common equity
$
1,035,497

 
1,010,303

 
969,672

 
25,194

 
65,825

Accumulated other comprehensive income
18,027

 
17,744

 
15,288

 
283

 
2,739

Total stockholders’ equity
1,053,524

 
1,028,047

 
984,960

 
25,477

 
68,564

Goodwill and core deposit intangible, net
(143,099
)
 
(140,606
)
 
(138,508
)
 
(2,493
)
 
(4,591
)
Tangible stockholders’ equity
$
910,425

 
887,441

 
846,452

 
22,984

 
63,973

Stockholders’ equity to total assets
12.43
%
 
12.38
%
 
12.58
%
 
 
 
 
Tangible stockholders’ equity to total tangible assets
10.93
%
 
10.87
%
 
11.00
%
 
 
 
 
Book value per common share
$
13.95

 
13.70

 
13.23

 
0.25

 
0.72

Tangible book value per common share
$
12.05

 
11.83

 
11.37

 
0.22

 
0.68

Market price per share at end of period
$
25.15

 
27.77

 
29.07

 
(2.62
)
 
(3.92
)

Tangible stockholders’ equity of $910 million at March 31, 2015 increased $23.0 million, or 3 percent, from the prior quarter which was primarily the result of $10.8 million of Company stock issued in connection with the CB acquisition and earnings retention. Tangible stockholders’ equity increased $64.0 million from a year ago as the result of earnings retention, Company stock issued in connection with the CB and FNBR acquisitions, and an increase in accumulated other comprehensive income. Tangible book value per common share of $12.05 increased $0.22 per share from the prior quarter and increased $0.68 per share from the prior year first quarter.

Cash Dividend
On March 25, 2015, the Company’s Board of Directors declared a cash dividend of $0.18 per share during the current quarter. The dividend was payable April 16, 2015 to shareholders of record on April 7, 2015. Future cash dividends will depend on a variety of factors, including net income, capital, asset quality, general economic conditions and regulatory considerations.


6


Operating Results for Three Months Ended March 31, 2015 
Compared to December 31, 2014 and March 31, 2014

Revenue Summary
 
Three Months ended
 
$ Change from
(Dollars in thousands)
Mar 31,
2015
 
Dec 31,
2014
 
Mar 31,
2014
 
Dec 31,
2014
 
Mar 31,
2014
Net interest income
 
 
 
 
 
 
 
 
 
Interest income
$
77,486

 
76,179

 
74,087

 
1,307

 
3,399

Interest expense
7,382

 
7,368

 
6,640

 
14

 
742

Total net interest income
70,104

 
68,811

 
67,447

 
1,293

 
2,657

Non-interest income
 
 
 
 
 
 
 
 
 
Service charges, loan fees, and other fees
14,156

 
15,129

 
13,248

 
(973
)
 
908

Gain on sale of loans
5,430

 
5,424

 
3,595

 
6

 
1,835

Gain (loss) on sale of investments
5

 
(28
)
 
(51
)
 
33

 
56

Other income
3,102

 
3,453

 
2,596

 
(351
)
 
506

Total non-interest income
22,693

 
23,978

 
19,388

 
(1,285
)
 
3,305

 
$
92,797

 
92,789

 
86,835

 
8

 
5,962

Net interest margin (tax-equivalent)
4.03
%
 
3.92
%
 
4.02
%
 
 
 
 

Net Interest Income
The current quarter interest income of $77.5 million increased $1.3 million, or 2 percent, from the prior quarter. The current quarter increase in interest income was primarily driven by increases in interest income on commercial loans and interest income from the investment securities portfolio. The current quarter interest income on commercial loans increased $1.1 million, or 3 percent, from the prior quarter and the current quarter interest income on investment securities increased $909 thousand, or 4 percent, from the prior quarter. The current quarter’s interest income increased $3.4 million, or 5 percent, over the prior year first quarter and was primarily attributable to higher interest income on commercial loans, which offset the decrease in interest income on investment securities. The current quarter interest income of $39.0 million on commercial loans increased $4.0 million, or 11 percent, over the prior year first quarter primarily the result of an increase in volume in commercial loans. Current quarter interest income of $23.0 million on investment securities decreased $1.4 million, or 6 percent, over the prior year first quarter as a result of a decrease in volume in investment securities.

The current quarter interest expense of $7.4 million increased $14 thousand, or less than 1 percent, from the prior quarter. The current quarter interest expense increased $742 thousand from the prior year first quarter, such increase attributed to the interest expense associated with the interest rate swap which started interest expense accruals in the fourth quarter of 2014. The total cost of funding (including non-interest bearing deposits) for the current quarter and prior quarter was 42 basis points compared to 40 basis points in the prior year first quarter.

The Company’s net interest margin as a percentage of earning assets, on a tax-equivalent basis, for the current quarter was 4.03 percent compared to 3.92 percent in the prior quarter. The 11 basis points increase in the current quarter net interest margin was primarily driven by the 12 basis points increase in the yield on loans. The Company’s current quarter net interest margin increased 1 basis point from the prior year first quarter net interest margin of 4.02 percent. “The Bank divisions have done an excellent job in pricing loans where possible at higher yields in the first quarter,” said Ron Copher, Chief Financial Officer. “The first quarter’s higher yielding loans along with the increased loan volume provide a foundation for higher net interest income throughout the year,” Copher said.

7


Non-interest Income
Non-interest income for the current quarter totaled $22.7 million, a decrease of $1.3 million over the prior quarter and an increase of $3.3 million over the same quarter last year. Service fee income of $13.0 million, decreased $1.0 million, or 7 percent, from the prior quarter as a result of seasonal activity and increased $780 thousand, or 6 percent, from the prior year first quarter as a result of the increased number of deposit accounts. Gain of $5.4 million on the sale of the residential loans in the current quarter increased $1.8 million, or 51 percent, from the prior year first quarter as a result of an increase in mortgage refinancing activity. Other non-interest income for the current quarter of $3.1 million, decreased $351 thousand, or 10 percent, over the prior quarter due to a decrease of $411 thousand of insurance proceeds recognized from bank-owned life insurance policies. Other non-interest income for the current quarter increased $506 thousand, or 19 percent, over the prior year first quarter and was primarily attributable to $336 thousand of insurance proceeds recognized from a bank-owned life insurance policy during the current quarter. Included in other income was operating revenue of $71 thousand from other real estate owned (“OREO”) and gain of $346 thousand from the sale of OREO, a combined total of $417 thousand for the current quarter compared to $441 thousand for the prior quarter and $811 thousand for the prior year first quarter.

Non-interest Expense Summary
 
Three Months ended
 
$ Change from
(Dollars in thousands)
Mar 31,
2015
 
Dec 31,
2014
 
Mar 31,
2014
 
Dec 31,
2014
 
Mar 31,
2014
Compensation and employee benefits
$
32,244

 
30,807

 
28,634

 
1,437

 
3,610

Occupancy and equipment
7,362

 
7,191

 
6,613

 
171

 
749

Advertising and promotions
1,927

 
2,046

 
1,777

 
(119
)
 
150

Data processing
1,249

 
1,815

 
1,288

 
(566
)
 
(39
)
Other real estate owned
758

 
893

 
507

 
(135
)
 
251

Regulatory assessments and insurance
1,305

 
1,009

 
1,592

 
296

 
(287
)
Core deposit intangibles amortization
731

 
716

 
710

 
15

 
21

Other expenses
9,921

 
11,221

 
8,949

 
(1,300
)
 
972

Total non-interest expense
$
55,497

 
55,698

 
50,070

 
(201
)
 
5,427


Compensation and employee benefits for the current quarter increased by $1.4 million, or 5 percent, from the prior quarter due to the increased number of employees from the CB acquisition and increased benefit expenses. Compensation and employee benefits for the current quarter increased by $3.6 million from the prior year first quarter also due to the increased number of employees from the CB and FNBR acquisitions, along with additional benefit costs and salary increases. Current quarter occupancy and equipment expense increased $749 thousand, or 11 percent, from the prior year first quarter as a result of added costs associated with the CB and FNBR acquisitions. The current quarter data processing expense decreased $566 thousand, or 31 percent, from the prior quarter as a result of conversion related expenses in the fourth quarter of 2014. The current quarter OREO expense of $758 thousand included $414 thousand of operating expense, $224 thousand of fair value write-downs, and $120 thousand of loss on sale of OREO. Current quarter other expenses of $9.9 million decreased by $1.3 million, or 12 percent, from the prior quarter primarily from decreases in acquisition and conversion related expenses and decreases in expenses connected with New Markets Tax Credits. Current quarter other expense increased $972 thousand, or 11 percent, from the prior year first quarter due to increases in acquisition-related expenses.


8


Efficiency Ratio
The efficiency ratio for the current quarter was 54.8 percent and the prior year first quarter was 53.47 percent. The 1.33 percent increase in efficiency ratio resulted from increases in non-interest expense primarily the result of increased compensation and other operational expenses, which exceeded the increases in net interest income from higher yielding earning assets and increases in non-interest income from greater mortgage refinancing activity.

About Glacier Bancorp, Inc.
Glacier Bancorp, Inc. is a regional bank holding company providing commercial banking services in 82 communities in Montana, Idaho, Utah, Washington, Wyoming and Colorado. Glacier Bancorp, Inc. is headquartered in Kalispell, Montana, and  is the parent company for Glacier Bank, Kalispell and Bank divisions First Security Bank of Missoula; Valley Bank of Helena; Big Sky Western Bank, Bozeman; Western Security Bank, Billings; and First Bank of Montana, Lewistown, all operating in Montana; as well as Mountain West Bank, Coeur d’Alene operating in Idaho, Utah and Washington; Citizens Community Bank, Pocatello, operating in Idaho; 1st Bank, Evanston, operating in Wyoming and Utah;  First Bank of Wyoming, Powell and First State Bank, Wheatland, each operating in Wyoming; North Cascades Bank, Chelan, operating in Washington; and Bank of the San Juans, Durango, operating in Colorado.

Forward-Looking Statements
This news release may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, statements about management’s plans, objectives, expectations and intentions that are not historical facts, and other statements identified by words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “should,” “projects,” “seeks,” “estimates” or words of similar meaning. These forward-looking statements are based on current beliefs and expectations of management and are inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond the Company’s control. In addition, these forward-looking statements are subject to assumptions with respect to future business strategies and decisions that are subject to change. The following factors, among others, could cause actual results to differ materially from the anticipated results or other expectations in the forward-looking statements, including those set forth in this news release:
•
the risks associated with lending and potential adverse changes of the credit quality of loans in the Company’s portfolio;
•
the risks presented by the lingering economic recovery which could adversely affect credit quality, loan collateral values, OREO values, investment values, liquidity and capital levels, dividends and loan originations;
•
changes in market interest rates, which could adversely affect the Company’s net interest income and profitability;
•
legislative or regulatory changes that adversely affect the Company’s business, ability to complete pending or prospective future acquisitions, limit certain sources of revenue, or increase cost of operations;
•
costs or difficulties related to the completion and integration of acquisitions;
•
the goodwill the Company has recorded in connection with acquisitions could become additionally impaired, which may have an adverse impact on earnings and capital;
•
reduced demand for banking products and services;
•
the risks presented by public stock market volatility, which could adversely affect the market price of the Company’s common stock and the ability to raise additional capital or grow the Company through acquisitions;
•
consolidation in the financial services industry in the Company’s markets resulting in the creation of larger financial institutions who may have greater resources could change the competitive landscape;
•
dependence on the Chief Executive Officer, the senior management team and the Presidents of the Bank divisions;

9


•
potential interruption or breach in security of the Company’s systems; and
•
the Company’s success in managing risks involved in the foregoing.

The Company does not undertake any obligation to publicly correct or update any forward-looking statement if it later becomes aware that actual results are likely to differ materially from those expressed in such forward-looking statement.

10


Glacier Bancorp, Inc.
Unaudited Condensed Consolidated Statements of Financial Condition

(Dollars in thousands, except per share data)
March 31,
2015
 
December 31,
2014
 
March 31,
2014
Assets
 
 
 
 
 
Cash on hand and in banks
$
109,746

 
122,834

 
116,267

Federal funds sold
—

 
1,025

 
14,055

Interest bearing cash deposits
73,720

 
318,550

 
31,369

Cash and cash equivalents
183,466

 
442,409

 
161,691

Investment securities, available-for-sale
2,544,093

 
2,387,428

 
2,669,180

Investment securities, held-to-maturity
570,285

 
520,997

 
481,476

Total investment securities
3,114,378

 
2,908,425

 
3,150,656

Loans held for sale
54,132

 
46,726

 
36,133

Loans receivable
4,687,669

 
4,488,095

 
4,088,629

Allowance for loan and lease losses
(129,856
)
 
(129,753
)
 
(130,729
)
Loans receivable, net
4,557,813

 
4,358,342

 
3,957,900

Premises and equipment, net
187,067

 
179,175

 
166,757

Other real estate owned
28,124

 
27,804

 
27,332

Accrued interest receivable
43,260

 
40,587

 
41,274

Deferred tax asset
41,220

 
41,737

 
39,997

Core deposit intangible, net
12,256

 
10,900

 
8,802

Goodwill
130,843

 
129,706

 
129,706

Non-marketable equity securities
54,277

 
52,868

 
52,192

Other assets
68,260

 
67,828

 
58,283

Total assets
$
8,475,096

 
8,306,507

 
7,830,723

Liabilities
 
 
 
 
 
Non-interest bearing deposits
$
1,675,451

 
1,632,403

 
1,396,272

Interest bearing deposits
4,783,341

 
4,712,809

 
4,228,193

Securities sold under agreements to repurchase
425,652

 
397,107

 
327,322

FHLB advances
298,148

 
296,944

 
686,744

Other borrowed funds
6,703

 
7,311

 
8,069

Subordinated debentures
125,741

 
125,705

 
125,597

Accrued interest payable
3,893

 
4,155

 
3,173

Other liabilities
102,643

 
102,026

 
70,393

Total liabilities
7,421,572

 
7,278,460

 
6,845,763

Stockholders’ Equity
 
 
 
 
 
Preferred shares, $0.01 par value per share, 1,000,000 shares authorized, none issued or outstanding
—

 
—

 
—

Common stock, $0.01 par value per share, 117,187,500 shares authorized
755

 
750

 
745

Paid-in capital
719,506

 
708,356

 
692,196

Retained earnings - substantially restricted
315,236

 
301,197

 
276,731

Accumulated other comprehensive income
18,027

 
17,744

 
15,288

Total stockholders’ equity
1,053,524

 
1,028,047

 
984,960

Total liabilities and stockholders’ equity
$
8,475,096

 
8,306,507

 
7,830,723

Number of common stock shares issued and outstanding
75,530,030

 
75,026,092

 
74,465,666



11


Glacier Bancorp, Inc.
Unaudited Condensed Consolidated Statements of Operations

 
Three Months ended
(Dollars in thousands, except per share data)
March 31,
2015
 
December 31,
2014
 
March 31,
2014
Interest Income
 
 
 
 
 
Residential real estate loans
$
7,761

 
8,464

 
7,087

Commercial loans
39,022

 
37,935

 
35,042

Consumer and other loans
7,744

 
7,730

 
7,643

Investment securities
22,959

 
22,050

 
24,315

Total interest income
77,486

 
76,179

 
74,087

Interest Expense
 
 
 
 
 
Deposits
4,147

 
4,018

 
3,089

Securities sold under agreements to repurchase
241

 
238

 
210

Federal Home Loan Bank advances
2,195

 
2,253

 
2,514

Federal funds purchased and other borrowed funds
27

 
64

 
53

Subordinated debentures
772

 
795

 
774

Total interest expense
7,382

 
7,368

 
6,640

Net Interest Income
70,104

 
68,811

 
67,447

Provision for loan losses
765

 
191

 
1,122

Net interest income after provision for loan losses
69,339

 
68,620

 
66,325

Non-Interest Income
 
 
 
 
 
Service charges and other fees
12,999

 
14,004

 
12,219

Miscellaneous loan fees and charges
1,157

 
1,125

 
1,029

Gain on sale of loans
5,430

 
5,424

 
3,595

Gain (loss) on sale of investments
5

 
(28
)
 
(51
)
Other income
3,102

 
3,453

 
2,596

Total non-interest income
22,693

 
23,978

 
19,388

Non-Interest Expense
 
 
 
 
 
Compensation and employee benefits
32,244

 
30,807

 
28,634

Occupancy and equipment
7,362

 
7,191

 
6,613

Advertising and promotions
1,927

 
2,046

 
1,777

Data processing
1,249

 
1,815

 
1,288

Other real estate owned
758

 
893

 
507

Regulatory assessments and insurance
1,305

 
1,009

 
1,592

Core deposit intangibles amortization
731

 
716

 
710

Other expenses
9,921

 
11,221

 
8,949

Total non-interest expense
55,497

 
55,698

 
50,070

Income Before Income Taxes
36,535

 
36,900

 
35,643

Federal and state income tax expense
8,865

 
8,846

 
8,913

Net Income
$
27,670

 
28,054

 
26,730

Basic earnings per share
$
0.37

 
0.37

 
0.36

Diluted earnings per share
$
0.37

 
0.37

 
0.36

Dividends declared per share
$
0.18

 
0.48

 
0.16

Average outstanding shares - basic
75,206,348

 
75,025,201

 
74,437,393

Average outstanding shares - diluted
75,244,959

 
75,082,566

 
74,480,818


12


Glacier Bancorp, Inc.
Average Balance Sheet

 
Three Months ended
 
Three Months ended
 
March 31, 2015
 
March 31, 2014
(Dollars in thousands)
Average
Balance
 
Interest &
Dividends
 
Average
Yield/
Rate
 
Average
Balance
 
Interest &
Dividends
 
Average
Yield/
Rate
Assets
 
 
 
 
 
 
 
 
 
 
 
Residential real estate loans
$
651,700

 
$
7,761

 
4.76
%
 
$
609,534

 
$
7,087

 
4.65
%
Commercial loans 1
3,282,867

 
39,605

 
4.89
%
 
2,882,054

 
35,042

 
4.93
%
Consumer and other loans
609,853

 
7,744

 
5.15
%
 
576,625

 
7,643

 
5.38
%
Total loans 2
4,544,420

 
55,110

 
4.92
%
 
4,068,213

 
49,772

 
4.96
%
Tax-exempt investment securities 3
1,302,174

 
18,493

 
5.68
%
 
1,191,679

 
16,768

 
5.63
%
Taxable investment securities 4
1,904,835

 
10,754

 
2.26
%
 
2,101,464

 
13,064

 
2.49
%
Total earning assets
7,751,429

 
84,357

 
4.41
%
 
7,361,356

 
79,604

 
4.39
%
Goodwill and intangibles
140,726

 
 
 
 
 
138,901

 
 
 
 
Non-earning assets
379,581

 
 
 
 
 
317,625

 
 
 
 
Total assets
$
8,271,736

 
 
 
 
 
$
7,817,882

 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
 
 
Non-interest bearing deposits
$
1,618,132

 
$
—

 
—
%
 
$
1,329,736

 
$
—

 
—
%
NOW accounts
1,311,330

 
268

 
0.08
%
 
1,097,430

 
334

 
0.12
%
Savings accounts
713,897

 
89

 
0.05
%
 
628,947

 
80

 
0.05
%
Money market deposit accounts
1,304,006

 
517

 
0.16
%
 
1,187,525

 
600

 
0.20
%
Certificate accounts
1,165,483

 
1,843

 
0.64
%
 
1,132,828

 
1,984

 
0.71
%
Wholesale deposits 5
220,382

 
1,430

 
2.63
%
 
148,417

 
91

 
0.25
%
FHLB advances
299,975

 
2,195

 
2.93
%
 
825,823

 
2,514

 
1.22
%
Repurchase agreements, federal funds purchased and other borrowed funds
503,816

 
1,040

 
0.84
%
 
439,700

 
1,037

 
0.96
%
Total funding liabilities
7,137,021

 
7,382

 
0.42
%
 
6,790,406

 
6,640

 
0.40
%
Other liabilities
88,143

 
 
 
 
 
45,787

 
 
 
 
Total liabilities
7,225,164

 
 
 
 
 
6,836,193

 
 
 
 
Stockholders’ Equity
 
 
 
 
 
 
 
 
 
 
 
Common stock
752

 
 
 
 
 
744

 
 
 
 
Paid-in capital
712,127

 
 
 
 
 
691,626

 
 
 
 
Retained earnings
314,004

 
 
 
 
 
274,865

 
 
 
 
Accumulated other comprehensive income
19,689

 
 
 
 
 
14,454

 
 
 
 
Total stockholders’ equity
1,046,572

 
 
 
 
 
981,689

 
 
 
 
Total liabilities and stockholders’ equity
$
8,271,736

 
 
 
 
 
$
7,817,882

 
 
 
 
Net interest income (tax-equivalent)
 
 
$
76,975

 
 
 
 
 
$
72,964

 
 
Net interest spread (tax-equivalent)
 
 
 
 
3.99
%
 
 
 
 
 
3.99
%
Net interest margin (tax-equivalent)
 
 
 
 
4.03
%
 
 
 
 
 
4.02
%
__________ 
1 
Includes tax effect of $583 thousand on tax-exempt municipal loan and lease income for the three months ended March 31, 2015. The tax effect for the three months ended March 31, 2014 was not significant.
2 
Total loans are gross of the allowance for loan and lease losses, net of unearned income and include loans held for sale. Non-accrual loans were included in the average volume for the entire period.
3 
Includes tax effect of $5.9 million and $5.1 million on tax-exempt investment security income for the three months ended March 31, 2015 and 2014, respectively.
4 
Includes tax effect of $362 thousand and $372 thousand on federal income tax credits for the three months ended March 31, 2015 and 2014, respectively.
5 
Wholesale deposits include brokered deposits classified as NOW, money market deposit and certificate accounts.

13


Glacier Bancorp, Inc.
Loan Portfolio by Regulatory Classification

 
Loans Receivable, by Loan Type
 
% Change from
(Dollars in thousands)
Mar 31,
2015
 
Dec 31,
2014
 
Mar 31,
2014
 
Dec 31,
2014
 
Mar 31,
2014
Custom and owner occupied construction
$
51,693

 
$
56,689

 
$
44,333

 
(9
)%
 
17
 %
Pre-sold and spec construction
44,865

 
47,406

 
34,786

 
(5
)%
 
29
 %
Total residential construction
96,558

 
104,095

 
79,119

 
(7
)%
 
22
 %
Land development
81,488

 
82,829

 
82,275

 
(2
)%
 
(1
)%
Consumer land or lots
97,519

 
101,818

 
104,308

 
(4
)%
 
(7
)%
Unimproved land
80,206

 
86,116

 
49,871

 
(7
)%
 
61
 %
Developed lots for operative builders
14,210

 
14,126

 
15,984

 
1
 %
 
(11
)%
Commercial lots
21,059

 
16,205

 
15,609

 
30
 %
 
35
 %
Other construction
148,535

 
150,075

 
84,214

 
(1
)%
 
76
 %
Total land, lot, and other construction
443,017

 
451,169

 
352,261

 
(2
)%
 
26
 %
Owner occupied
877,293

 
849,148

 
812,727

 
3
 %
 
8
 %
Non-owner occupied
704,990

 
674,381

 
611,093

 
5
 %
 
15
 %
Total commercial real estate
1,582,283

 
1,523,529

 
1,423,820

 
4
 %
 
11
 %
Commercial and industrial
585,501

 
547,910

 
523,071

 
7
 %
 
12
 %
Agriculture
340,364

 
310,785

 
269,886

 
10
 %
 
26
 %
1st lien
796,947

 
775,785

 
726,471

 
3
 %
 
10
 %
Junior lien
67,217

 
68,358

 
71,012

 
(2
)%
 
(5
)%
Total 1-4 family
864,164

 
844,143

 
797,483

 
2
 %
 
8
 %
Multifamily residential
177,187

 
160,426

 
143,438

 
10
 %
 
24
 %
Home equity lines of credit
347,693

 
334,788

 
298,073

 
4
 %
 
17
 %
Other consumer
141,347

 
133,773

 
131,030

 
6
 %
 
8
 %
Total consumer
489,040

 
468,561

 
429,103

 
4
 %
 
14
 %
Other
163,687

 
124,203

 
106,581

 
32
 %
 
54
 %
Total loans receivable, including loans held for sale
4,741,801

 
4,534,821

 
4,124,762

 
5
 %
 
15
 %
Less loans held for sale 1
(54,132
)
 
(46,726
)
 
(36,133
)
 
16
 %
 
50
 %
Total loans receivable
$
4,687,669

 
$
4,488,095

 
$
4,088,629

 
4
 %
 
15
 %
_______
1 Loans held for sale are primarily 1st lien 1-4 family loans.


14


Glacier Bancorp, Inc.
Credit Quality Summary by Regulatory Classification

 
 
Non-performing Assets, by Loan Type
 
Non-
Accrual
Loans
 
Accruing
Loans 90  Days or  More Past  Due
 
Other
Real Estate
Owned
(Dollars in thousands)
Mar 31,
2015
 
Dec 31,
2014
 
Mar 31,
2014
 
Mar 31,
2015
Mar 31,
2015
Mar 31,
2015
Custom and owner occupied construction
$
1,101

 
1,132

 
1,227

 
1,101

 
—

 
—

Pre-sold and spec construction
218

 
218

 
663

 
218

 
—

 
—

Total residential construction
1,319

 
1,350

 
1,890

 
1,319

 
—

 
—

Land development
21,220

 
20,842

 
24,555

 
11,250

 
—

 
9,970

Consumer land or lots
2,531

 
3,581

 
3,169

 
1,111

 
47

 
1,373

Unimproved land
13,448

 
14,170

 
12,965

 
10,826

 
—

 
2,622

Developed lots for operative builders
929

 
1,318

 
2,157

 
718

 
—

 
211

Commercial lots
2,496

 
2,660

 
2,842

 
249

 
—

 
2,247

Other construction
4,989

 
5,151

 
5,168

 
—

 
—

 
4,989

Total land, lot and other construction
45,613

 
47,722

 
50,856

 
24,154

 
47

 
21,412

Owner occupied
13,121

 
13,574

 
14,625

 
10,946

 
—

 
2,175

Non-owner occupied
3,771

 
3,013

 
3,563

 
1,649

 
—

 
2,122

Total commercial real estate
16,892

 
16,587

 
18,188

 
12,595

 
—

 
4,297

Commercial and industrial
6,367

 
4,375

 
5,030

 
6,270

 
50

 
47

Agriculture
2,845

 
3,074

 
3,484

 
2,397

 
—

 
448

1st lien
9,502

 
9,580

 
17,457

 
8,038

 
216

 
1,248

Junior lien
680

 
442

 
4,947

 
469

 
211

 
—

Total 1-4 family
10,182

 
10,022

 
22,404

 
8,507

 
427

 
1,248

Multifamily residential
—

 
440

 
156

 
—

 
—

 
—

Home equity lines of credit
5,507

 
6,099

 
4,434

 
4,864

 
—

 
643

Other consumer
243

 
231

 
364

 
181

 
33

 
29

Total consumer
5,750

 
6,330

 
4,798

 
5,045

 
33

 
672

Other
1,800

 
—

 
—

 
—

 
1,800

 
—

Total
$
90,768

 
89,900

 
106,806

 
60,287

 
2,357

 
28,124



15


Glacier Bancorp, Inc.
Credit Quality Summary by Regulatory Classification (continued)

 
Accruing 30-89 Days Delinquent Loans,  by Loan Type
 
% Change from
(Dollars in thousands)
Mar 31,
2015
 
Dec 31,
2014
 
Mar 31,
2014
 
Dec 31,
2014
 
Mar 31,
2014
Custom and owner occupied construction
$
—

 
$
—

 
$
277

 
n/m

 
(100
)%
Pre-sold and spec construction
—

 
869

 
101

 
(100
)%
 
(100
)%
Total residential construction
—

 
869

 
378

 
(100
)%
 
(100
)%
Consumer land or lots
365

 
391

 
504

 
(7
)%
 
(28
)%
Unimproved land
278

 
267

 
420

 
4
 %
 
(34
)%
Developed lots for operative builders
19

 
—

 
1,163

 
n/m

 
(98
)%
Commercial lots
585

 
21

 
—

 
2,686
 %
 
n/m

Total land, lot and other construction
1,247

 
679

 
2,087

 
84
 %
 
(40
)%
Owner occupied
4,841

 
5,971

 
9,099

 
(19
)%
 
(47
)%
Non-owner occupied
4,327

 
3,131

 
2,901

 
38
 %
 
49
 %
Total commercial real estate
9,168

 
9,102

 
12,000

 
1
 %
 
(24
)%
Commercial and industrial
6,600

 
2,915

 
6,192

 
126
 %
 
7
 %
Agriculture
3,715

 
994

 
2,710

 
274
 %
 
37
 %
1st lien
7,307

 
6,804

 
15,018

 
7
 %
 
(51
)%
Junior lien
384

 
491

 
503

 
(22
)%
 
(24
)%
Total 1-4 family
7,691

 
7,295

 
15,521

 
5
 %
 
(50
)%
Multifamily Residential
676

 
—

 
1,535

 
n/m

 
(56
)%
Home equity lines of credit
3,350

 
1,288

 
1,506

 
160
 %
 
122
 %
Other consumer
1,003

 
928

 
933

 
8
 %
 
8
 %
Total consumer
4,353

 
2,216

 
2,439

 
96
 %
 
78
 %
Other
—

 
1,834

 
—

 
(100
)%
 
n/m

Total
$
33,450

 
$
25,904

 
$
42,862

 
29
 %
 
(22
)%
_______
n/m - not measurable


16


Glacier Bancorp, Inc.
Credit Quality Summary by Regulatory Classification (continued)

 
Net Charge-Offs (Recoveries), Year-to-Date
Period Ending, By Loan Type
 
Charge-Offs
 
Recoveries
(Dollars in thousands)
Mar 31,
2015
 
Dec 31,
2014
 
Mar 31,
2014
 
Mar 31,
2015
Mar 31,
2015
Pre-sold and spec construction
$
(9
)
 
(94
)
 
(16
)
 
—

 
9

Land development
(23
)
 
(390
)
 
93

 
11

 
34

Consumer land or lots
(15
)
 
375

 
(69
)
 
24

 
39

Unimproved land
(50
)
 
52

 
(5
)
 
—

 
50

Developed lots for operative builders
(96
)
 
(140
)
 
(17
)
 
—

 
96

Commercial lots
(1
)
 
(6
)
 
(2
)
 
—

 
1

Other construction
(1
)
 
—

 
—

 
—

 
1

Total land, lot and other construction
(186
)
 
(109
)
 
—

 
35

 
221

Owner occupied
316

 
669

 
(18
)
 
347

 
31

Non-owner occupied
82

 
(162
)
 
(185
)
 
88

 
6

Total commercial real estate
398

 
507

 
(203
)
 
435

 
37

Commercial and industrial
426

 
1,069

 
1,038

 
589

 
163

Agriculture
(4
)
 
28

 
—

 
—

 
4

1st lien
(30
)
 
372

 
(199
)
 
16

 
46

Junior lien
(54
)
 
183

 
38

 
—

 
54

Total 1-4 family
(84
)
 
555

 
(161
)
 
16

 
100

Multifamily residential
(20
)
 
138

 
1

 
—

 
20

Home equity lines of credit
121

 
190

 
51

 
133

 
12

Other consumer
20

 
226

 
34

 
89

 
69

Total consumer
141

 
416

 
85

 
222

 
81

Total
$
662

 
2,510

 
744

 
1,297

 
635


















Visit our website at www.glacierbancorp.com

17
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