CHFC 2018 Annual Report

Year Ended December 31, (Dollars in thousands, except per share data) 2018 2017 2016 2015 2014 Total operating expenses as a percentage of total average assets Average assets $20,200,530 $ 18,465,156 $ 12,037,155 $ 8,481,228 $ 6,473,144 Operating expenses - GAAP $ 424,198 $ 421,994 $ 338,418 $ 223,894 $ 179,925 Merger and restructuring expenses — (28,402) (61,134) (7,804) (6,388) Impairment of income tax credits (12,284) (9,252) — — — Operating expense, core - non-GAAP 411,914 384,340 277,284 216,090 173,537 Total operating expenses as a percentage of total average assets 2.10% 2.29% 2.81% 2.64% 2.78% Total operating expenses, core, as a percentage of total average assets - adjusted non-GAAP 2.04% 2.08% 2.30% 2.55% 2.68% December 31, (Dollars in thousands, except per share data) 2018 2017 2016 2015 2014 Tangible Book Value Shareholders' equity, as reported $ 2,836,260 $ 2,668,749 $ 2,581,526 $ 1,015,974 $ 797,133 Goodwill, CDI and noncompete agreements, net of tax (1,153,877) (1,158,738) (1,155,528) (301,073) (190,714) Tangible shareholders' equity $ 1,682,383 $ 1,510,011 $ 1,425,998 $ 714,901 $ 606,419 Common shares outstanding 71,460 71,207 70,599 38,168 32,774 Book value per share (shareholders' equity, as reported, divided by common shares outstanding) $ 39.69 $ 37.48 $ 36.57 $ 26.62 $ 24.32 Tangible book value per share (tangible shareholders' equity divided by common shares outstanding) $ 23.54 $ 21.21 $ 20.20 $ 18.73 $ 18.50 Tangible Shareholders' Equity to Tangible Assets Total assets, as reported $21,498,341 $ 19,280,873 $ 17,355,179 $ 9,188,797 $ 7,322,143 Goodwill, CDI and noncompete agreements, net of tax (1,153,877) (1,158,738) (1,155,528) (301,073) (190,714) Tangible assets $20,344,464 $ 18,122,135 $ 16,199,651 $ 8,887,724 $ 7,131,429 Shareholders' equity to total assets 13.2% 13.8% 14.9% 11.1% 10.9% Tangible shareholders' equity to tangible assets 8.3% 8.3% 8.8% 8.0% 8.5% 49 Statements of Financial Position Review Overview Total assets were $21.50 billion at December 31, 2018, an increase of $2.22 billion, or 11.5%, compared to total assets at December 31, 2017 of $19.28 billion. Interest-earning assets were $19.46 billion at December 31, 2018, an increase of $2.20 billion, or 12.8%, compared to interest-earning assets of $17.26 billion at December 31, 2017. The increase in both total assets and interest-earnings assets in 2018, compared to 2017, was primarily attributable to a $1.11 billion increase in total loans and a $1.01 billion increase in our investment securities portfolio. Total liabilities were $18.66 billion at December 31, 2018, an increase of $2.05 billion, or 12.3%, compared to total liabilities at December 31, 2017 of $16.61 billion. The increase in liabilities in 2018, compared to 2017, was primarily attributable to a $1.95 billion increase in deposits.