UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

 
FORM 10-Q
 

☒Quarterly report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934
For the quarterly period ended September 30, 2017March 31, 2022
Commission file number 1-10312
 

syn-20220331_g1.jpg
SYNOVUS FINANCIAL CORP.
(Exact name of registrant as specified in its charter)

Georgia58-1134883
(State or other jurisdiction ofincorporation or organization)
   (I.R.S. EmployerIdentification No.)
1111 Bay Avenue,
Suite 500 Columbus, Georgia
31901

Columbus,Georgia31901
(Address of principal executive offices)(Zip Code)
Registrant’s telephone number, including area code: (706) 649-2311641-6500
Securities registered pursuant to Section 12(b) of the Act:

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, $1.00 Par Value
Series B Participating Cumulative Preferred
SNVNew York Stock Purchase Rights
Exchange
Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series CD
SNV - PrD
New York Stock Exchange
Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series ESNV - PrENew York Stock Exchange
New York Stock Exchange
Securities registered pursuant to Section 12(g) of the Act: NONE

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    YES x  NO ¨Yes ☒  No ☐
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).   YES x  NO ¨Yes ☒  No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer” and, “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act. (Check One):
Large accelerated filer☒Accelerated filer☐
Large accelerated filerxAccelerated filer¨
Non-accelerated filer
¨ (Do not check if a smaller reporting company)
☐		Smaller reporting company¨☐
Emerging growth company¨☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to section 7(a)2(B)Section 13(a) of the SecuritiesExchange Act.  ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES ¨    NO xYes ☐    No ☒
Indicate the numberAs of April 30, 2022, 145,340,935 shares outstanding of each of the issuer’s class ofregistrant's common stock, as$1.00 par value, were outstanding.




Table of the latest practicable date.
Contents
ClassNovember 2, 2017
Page
Common Stock, $1.00 Par ValueFinancial Information119,514,829


Table of Contents
Page
Part I.
Financial Information
Index of Defined Terms
i
Item 1.Financial Statements (Unaudited)
Consolidated Balance Sheets as of September 30, 2017March 31, 2022 and December 31, 20162021
1
Consolidated Statements of Income for the Nine and Three Months Ended September 30, 2017March 31, 2022 and 20162021
2
Consolidated Statements of Comprehensive Income (Loss) for the Nine and Three Months Ended September 30, 2017March 31, 2022 and 20162021
3
Consolidated Statements of Changes in Shareholders' Equity for the NineThree Months Ended September 30, 2017March 31, 2022 and 20162021
4
Consolidated Statements of Cash Flows for the NineThree Months Ended September 30, 2017March 31, 2022 and 20162021
5
Notes to Unaudited Interim Consolidated Financial Statements
76
Item 2.Management's Discussion and Analysis of Financial Condition and Results of Operations
4232
Item 3.
7755
Item 4.Controls and Procedures
7755
Other Information
Item 1.Legal Proceedings
7856
Item 1A.Risk Factors
7856
Item 2.Unregistered Sales of Equity Securities and Use of Proceeds
7856
Item 3.Defaults Upon Senior Securities
7956
Item 4.Mine Safety Disclosures
7956
Item 5.Other Information
7956
Item 6.Exhibits
8057
Signatures
8158







SYNOVUS FINANCIAL CORP.
INDEX OF DEFINED TERMS

Throughout this discussion, references to "Synovus", "we", "our", "us", "the Company" and similar terms refer to the consolidated entity consisting of Synovus Financial Corp. and its subsidiaries unless the context indicates that we refer only to the Parent Company, Synovus Financial Corp. When we refer to the "Bank" or "Synovus Bank" we mean our only bank subsidiary, Synovus Bank.
ACL – Allowance for credit losses (ALL, reserve on unfunded loan commitments, and reserve, if required, on debt securities)
ALCO – Synovus' Asset Liability Management Committee
ALL – Allowance for loan losses
AOCI – Accumulated other comprehensive income (loss)
ARRC – Alternative Reference Rates Committee
ASC – Accounting Standards Codification
ASU – Accounting Standards Update
ATM – Automatic teller machine
Basel III – A global regulatory frameworkThe third Basel Accord developed by the Basel Committee on Banking Supervision to strengthen existing regulatory capital requirements
BOLI – Bank-Owned Life InsuranceBank-owned life insurance
BOV – Broker’s opinion of value
bpbp(s) – Basis point (bps - basis points)point(s)
BSBY –Bloomberg Short-Term Bank Yield Index
C&I – Commercial and industrial loans
CARES Act – The Coronavirus Aid, Relief, and Economic Security Act
CDI – Core Deposit Intangible
CECL –Current expected credit losses
CET1 – Common Equity Tier 1 Capital defined by Basel III capital rules
CME – Chicago Mercantile Exchange
CMO – Collateralized Mortgage Obligationmortgage obligation
Cabela’s Transaction – The transaction completed on September 25, 2017 whereby Synovus Bank acquired certain assets and assumed certain liabilities of WFB and then immediately thereafter sold WFB’s credit card assets and certain related liabilities to Capital One Bank (USA), National Association, a bank subsidiary of Capital One Financial Corporation.  As a part of this transaction, Synovus Bank retained WFB’s $1.10 billion brokered time deposit portfolio and received a $75.0 million fee from Cabela’s and Capital One.  Throughout this Report, we refer to this transaction as the “Cabela’s Transaction” and the associated $75.0 million fee received from Cabela’s and Capital One as the “Cabela’s Transaction Fee”
Code – Internal Revenue Code, of 1986, as amended
Company – Synovus Financial Corp. and its wholly-owned subsidiaries, except where the context requires otherwise
Covered Litigation – Certain Visa litigation for which Visa is indemnified by Visa USA members
COVID-19 – Coronavirus disease 2019
CRA – Community Reinvestment Act
CRE – Commercial real estate
DIF ESG– Deposit Insurance FundEnvironmental, social, and governance
Dodd-Frank ActEVE – The Dodd-Frank Wall Street Reform and Consumer Protection Act
EVE – economicEconomic value of equity
Exchange Act – Securities Exchange Act of 1934, as amended
FASB – Financial Accounting Standards Board
FCA – Financial Conduct Authority, a regulatory authority of the United Kingdom
FDIC – Federal Deposit Insurance Corporation
Federal Reserve Bank – TheOne of the 12 banks that are the operating arms of the U.S. central bank. They implement the policies of the Federal Reserve Board, supervise bank holding companies and certain banking institutions, and also conduct economic research
i

Federal Reserve Board – The 7-member Board of Governors that oversees the Federal Reserve System, establishes monetary policy (interest rates, credit, etc.), and monitors the economic health of the country. Its members are appointed by the President subject to Senate confirmation, and serve 14-year terms
Federal Reserve System or Federal Reserve – The Federal Reserve Board plus 12 Federal Reserve Banks, with each one serving member banks in its own district. This system, supervised by theThe Federal Reserve, Board, has broad regulatory powers over the money supply and the credit structure of the economy
FFIEC – Federal Financial Institutions Examination Council
FFIEC Retail Credit Classification Policy – FFIEC Uniform Retail Credit Classification and Account Management Policy
FHLB – Federal Home Loan Bank
FICO – Fair Isaac Corporation
FTP – Funds transfer pricing
GA DBF – Georgia Department of Banking and Finance

i
Table of Contents

GAAP – Generally Accepted Accounting Principles in the United States of America
GGL – governmentGovernment guaranteed loans
Global One– Entaire Global Companies, Inc., the parent company of Global One Financial, Inc., as acquired by Synovus in 2016
Interagency Supervisory Guidance – Interagency Supervisory Guidance on October 1, 2016. Throughout this Report, we refer to this acquisition as "Global One"Allowance for Loan and Lease Losses Estimation Practices for Loans and Lines of Credit Secured by Junior Liens on 1-4 Family Residential Properties
HELOCLIBOR – Home equity line of creditLondon Interbank Offered Rate
LIHTC – Low Income Housing Tax Credit
LTV – Loan-to-collateral value ratio
MBS – Mortgage-backed security
MPS – Merchant processing servicer(s)
NAICS – North American Industry Classification System
nm – not meaningful
NPA – Non-performing assets
NPL – Non-performing loans
NSF – Non-sufficient funds
OCI – Other comprehensive income (loss)
OTC– Over-the-counter
ORE – Other real estate
OTTI – Other-than-temporary impairment
Parent Company – Synovus Financial Corp.
PPP –Paycheck Protection Program established as part of the CARES Act and launched on April 3, 2020 by the SBA and Treasury
SAB –Staff Accounting Bulletin
SBA – Small Business Administration
SCMSBIC – State, county, and municipalSmall Business Investment Company
SEC – U.S. Securities and Exchange Commission
Securities Act – Securities Act of 1933, as amended
Series CD Preferred Stock – Synovus' Fixed-to-Floating Rate Non-Cumulative Perpetual Preferred Stock, Series C,D, $25 liquidation preference
Series E Preferred Stock – Synovus' Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series E, $25 liquidation preference
ii

SOFR – Secured Overnight Financing Rate
Synovus – Synovus Financial Corp.
Synovus Bank – A Georgia state-chartered bank and wholly-owned subsidiary of Synovus through which Synovus conducts its banking operations
Synovus' 20162021 Form 10-K – Synovus' Annual Report on Form 10-K for the year ended December 31, 20162021
Synovus MortgageForward – Synovus Mortgage Corp., a wholly-owned subsidiary Synovus' revenue growth and expense efficiency initiatives announced in January of Synovus Bank2020
Synovus Securities – Synovus Securities, Inc., a wholly-owned subsidiary of Synovus
Synovus Trust – Synovus Trust Company, N.A., a wholly-owned subsidiary of Synovus Bank
TDR – Troubled debt restructuring (as defined in ASC 310-40)
Treasury TE – United States Department of the TreasuryTaxable equivalent
VIEUPB – Variable interest entity, as defined in ASC 810-10Unpaid principal balance
Visa – The Visa U.S.A., Inc. card association or its affiliates, collectively
Visa Class A shares – Class A shares of common stock issued by Visa are publicly traded shares which are not subject to restrictions on sale
Visa Class B shares – Class B shares of common stock issued by Visa which are subject to restrictions with respect to sale until all of the Covered Litigation has been settledsettled. Class B shares will be convertible into Visa Class A shares using a then-current conversion ratio upon the lifting of restrictions with respect to sale of Visa Class B shares
Visa Derivativederivative – A derivative contract with the purchaser of Visa Class B shares which provides for settlements between the purchaser and Synovus based upon a change in the ratio for conversion of Visa Class B shares into Visa Class A shares
Warrant – A warrant issued to the Treasury by Synovus to purchase up to 2,215,820 shares of Synovus common stock at a per share exercise price of $65.52 expiring on December 19, 2018, as was issued by Synovus to Treasury in 2008 in connection with the Capital Purchase Program, promulgated under the Emergency Stabilization Act of 2008
WFB – World's Foremost Bank, a wholly-owned subsidiary of Cabela's Incorporated


ii
iii
Table of Contents



PART I. FINANCIAL INFORMATION
ITEM 1. - FINANCIAL STATEMENTS
SYNOVUS FINANCIAL CORP.
CONSOLIDATED BALANCE SHEETS
(unaudited)
(in thousands, except share and per share data)September 30, 2017 December 31, 2016
ASSETS   
Cash and cash equivalents$386,459
 395,175
Interest bearing funds with Federal Reserve Bank1,297,581
 527,090
Interest earning deposits with banks6,047
 18,720
Federal funds sold and securities purchased under resale agreements48,820
 58,060
Trading account assets, at fair value12,329
 9,314
Mortgage loans held for sale, at fair value54,072
 51,545
Other loans held for sale31,253
 —
Investment securities available for sale, at fair value3,825,443
 3,718,195
Loans, net of deferred fees and costs24,487,360
 23,856,391
Allowance for loan losses(249,683) (251,758)
Loans, net$24,237,677
 23,604,633
Premises and equipment, net423,245
 417,485
Goodwill57,315
 59,678
Other intangible assets11,548
 13,223
Other real estate10,551
 22,308
Deferred tax asset, net272,052
 395,356
Other assets967,731
 813,220
Total assets$31,642,123
 30,104,002
LIABILITIES AND SHAREHOLDERS' EQUITY   
Liabilities   
Deposits:   
Non-interest bearing deposits$7,302,682
 7,085,804
Interest bearing deposits, excluding brokered deposits16,420,319
 16,183,273
Brokered deposits2,463,227
 1,378,983
Total deposits26,186,228
 24,648,060
Federal funds purchased and securities sold under repurchase agreements141,539
 159,699
Long-term debt1,882,607
 2,160,881
Other liabilities434,671
 207,438
Total liabilities$28,645,045
 27,176,078
Shareholders' Equity   
Series C Preferred Stock – no par value. Authorized 100,000,000 shares; 5,200,000 shares issued and outstanding at September 30, 2017 and December 31, 2016$125,980
 125,980
Common stock - $1.00 par value. Authorized 342,857,143 shares; 142,525,139 issued at September 30, 2017 and 142,025,720 issued at December 31, 2016; 119,566,625 outstanding at September 30, 2017 and 122,266,106 outstanding at December 31, 2016142,525
 142,026
Additional paid-in capital3,033,682
 3,028,405
Treasury stock, at cost – 22,958,514 shares at September 30, 2017 and 19,759,614 shares at December 31, 2016(800,509) (664,595)
Accumulated other comprehensive loss(39,596) (55,659)
Retained earnings534,996
 351,767
Total shareholders’ equity2,997,078
 2,927,924
Total liabilities and shareholders' equity$31,642,123
 30,104,002
    
See accompanying notes to unaudited interim consolidated financial statements.

SYNOVUS FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
 Nine Months Ended September 30, Three Months Ended September 30,
(in thousands, except per share data)2017 2016 2017 2016
Interest income:       
      Loans, including fees$785,166
 700,340
 $273,847
 237,448
      Investment securities available for sale60,112
 49,926
 20,014
 16,269
      Trading account assets90
 46
 41
 13
      Mortgage loans held for sale1,478
 1,966
 506
 727
      Federal Reserve Bank balances4,084
 3,170
 1,569
 1,151
      Other earning assets4,633
 2,822
 1,675
 946
Total interest income855,563
 758,270
 297,652
 256,554
Interest expense:       
Deposits55,874
 48,072
 20,798
 15,858
Federal funds purchased and securities sold under repurchase agreements125
 154
 42
 58
Long-term debt45,967
 44,394
 14,240
 14,631
Total interest expense101,966
 92,620
 35,080
 30,547
Net interest income753,597
 665,650
 262,572
 226,007
Provision for loan losses58,620
 21,741
 39,686
 5,671
Net interest income after provision for loan losses694,977
 643,909
 222,886
 220,336
Non-interest income:       
Service charges on deposit accounts59,848
 60,772
 20,255
 20,822
Fiduciary and asset management fees37,290
 34,691
 12,615
 11,837
Brokerage revenue21,947
 20,019
 7,511
 6,199
Mortgage banking income17,151
 18,755
 5,603
 7,329
Bankcard fees24,339
 24,988
 7,901
 8,269
Cabela's Transaction Fee75,000
 —
 75,000
 —
Investment securities (losses) gains, net(289) 126
 (7,956) 59
Decrease in fair value of private equity investments, net(3,193) (527) (27) (249)
Other fee income16,127
 15,255
 5,094
 5,171
Other non-interest income27,754
 25,109
 9,439
 8,718
Total non-interest income275,974
 199,188
 135,435
 68,155
Non-interest expense:       
Salaries and other personnel expense322,079
 300,364
 109,675
 101,945
Net occupancy and equipment expense89,837
 81,480
 30,573
 28,120
Third-party processing expense39,882
 34,033
 13,659
 11,219
FDIC insurance and other regulatory fees20,723
 20,100
 7,078
 6,756
Professional fees20,048
 19,794
 7,141
 6,486
Advertising expense14,868
 15,358
 3,610
 5,597
Foreclosed real estate expense, net10,847
 9,998
 7,265
 2,725
Earnout liability adjustments3,766
 —
 2,059
 —
Merger-related expense110
 550
 23
 550
Loss on early extinguishment of debt, net—
 4,735
 —
 —
Fair value adjustment to Visa derivative—
 1,079
 —
 360
Restructuring charges, net7,043
 8,225
 519
 1,243
Other operating expenses65,577
 67,000
 24,044
 20,870
Total non-interest expense594,780
 562,716
 205,646
 185,871
Income before income taxes376,171
 280,381
 152,675
 102,620
Income tax expense130,303
 102,148
 54,668
 37,375
Net income245,868
 178,233
 98,007
 65,245
Dividends on preferred stock7,678
 7,678
 2,559
 2,559
Net income available to common shareholders$238,190
 170,555
 $95,448
 62,686
Net income per common share, basic$1.96
 1.36
 $0.79
 0.51
Net income per common share, diluted1.94
 1.36
 0.78
 0.51
Weighted average common shares outstanding, basic121,796
 125,076
 120,900
 122,924
Weighted average common shares outstanding, diluted122,628
 125,712
 121,814
 123,604
        
(in thousands, except share and per share data)March 31, 2022December 31, 2021
ASSETS
Cash and due from banks$557,178 $432,925 
Interest-bearing funds with Federal Reserve Bank941,272 2,479,006 
Interest earning deposits with banks27,411 25,535 
Federal funds sold and securities purchased under resale agreements27,642 72,387 
     Total cash, cash equivalents, and restricted cash1,553,503 3,009,853 
Investment securities available for sale, at fair value10,463,101 10,918,329 
Loans held for sale (includes $111,992 and $108,198 measured at fair value, respectively)723,921 750,642 
Loans, net of deferred fees and costs40,169,150 39,311,958 
Allowance for loan losses(414,956)(427,597)
Loans, net39,754,194 38,884,361 
Cash surrender value of bank-owned life insurance1,075,175 1,068,616 
Premises, equipment, and software, net386,631 407,241 
Goodwill452,390 452,390 
Other intangible assets, net33,478 35,596 
Other assets1,977,156 1,790,198 
Total assets$56,419,549 $57,317,226 
LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities
Deposits:
Non-interest-bearing deposits$16,611,344 $16,392,653 
Interest-bearing deposits32,044,900 33,034,623 
Total deposits48,656,244 49,427,276 
Federal funds purchased and securities sold under repurchase agreements501,124 264,133 
Long-term debt805,259 1,204,229 
Other liabilities1,632,287 1,124,788 
Total liabilities51,594,914 52,020,426 
Shareholders' Equity
Preferred stock - no par value; authorized 100,000,000 shares; issued 22,000,000537,145 537,145 
Common stock - $1.00 par value; authorized 342,857,143 shares; issued 169,912,021 and 169,383,758; outstanding 145,334,763 and 145,010,086169,912 169,384 
Additional paid-in capital3,899,269 3,894,109 
Treasury stock, at cost; 24,577,258 and 24,373,672 shares(941,168)(931,497)
Accumulated other comprehensive income (loss), net(662,065)(82,321)
Retained earnings1,821,542 1,709,980 
Total shareholders' equity4,824,635 5,296,800 
Total liabilities and shareholders' equity$56,419,549 $57,317,226 
See accompanying notes to unaudited interim consolidated financial statements.


1


SYNOVUS FINANCIAL CORP.
CONSOLIDATEDCONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(unaudited)

 Nine Months Ended September 30,
 2017 2016
(in thousands)Before-tax Amount Tax (Expense) Benefit Net of Tax Amount Before-tax Amount Tax (Expense) Benefit Net of Tax Amount
Net income$376,171
 (130,303) 245,868
 280,381
 (102,148) 178,233
Net change related to cash flow hedges:           
Reclassification adjustment for losses realized in net income130
 (50) 80
 402
 (155) 247
Net unrealized gains on investment securities available for sale:           
Reclassification adjustment for net losses (gains) realized in net income289
 (111) 178
 (126) 49
 (77)
Net unrealized gains arising during the period25,715
 (9,903) 15,812
 56,648
 (21,821) 34,827
Net unrealized gains26,004
 (10,014) 15,990
 56,522
 (21,772) 34,750
Post-retirement unfunded health benefit:           
Reclassification adjustment for gains realized in net income(74) 29
 (45) (124) 48
 (76)
Actuarial gains arising during the period61
 (23)—
38
 102
 (39) 63
Net unrealized (realized) gains$(13) 6
 (7) (22) 9
 (13)
Other comprehensive income$26,121
 (10,058) 16,063
 56,902
 (21,918) 34,984
Comprehensive income    $261,931
     213,217
            

 Three Months Ended September 30,
 2017 2016
(in thousands)Before-tax Amount Tax (Expense) Benefit Net of Tax Amount Before-tax Amount Tax (Expense) Benefit Net of Tax Amount
Net income$152,675
 (54,668) 98,007
 102,620
 (37,375) 65,245
Net change related to cash flow hedges:           
Reclassification adjustment for losses realized in net income—
 —
 —
 65
 (25) 40
Net unrealized gains (losses) on investment securities available for sale:

 

        
Reclassification adjustment for net losses (gains) realized in net income7,956
 (3,063) 4,893
 (59) 23
 (36)
Net unrealized gains (losses) arising during the period5,465
 (2,106) 3,359
 (9,567) 3,672
 (5,895)
Net unrealized gains (losses)13,421
 (5,169) 8,252
 (9,626) 3,695
 (5,931)
Post-retirement unfunded health benefit:  

        
Reclassification adjustment for gains realized in net income(34) 13
 (21) (20) 8
 (12)
Actuarial gains arising during the period61
 (23)—
38
 102
 (39) 63
Net unrealized (realized) gains$27
 (10) 17
 82
 (31) 51
Other comprehensive income (loss)$13,448
 (5,179) 8,269
 (9,479) 3,639
 (5,840)
Comprehensive income    $106,276
     59,405
            
Three Months Ended March 31,
(in thousands, except per share data)20222021
Interest income:
Loans, including fees$361,091 $372,491 
Investment securities available for sale47,249 29,458 
Loans held for sale6,182 6,462 
Federal Reserve Bank balances788 673 
Other earning assets752 733 
Total interest income416,062 409,817 
Interest expense:
Deposits13,659 25,018 
Long-term debt10,144 10,908 
Other borrowings11 34 
Total interest expense23,814 35,960 
Net interest income392,248 373,857 
Provision for (reversal of) credit losses11,400 (18,575)
Net interest income after provision for (reversal of) credit losses380,848 392,432 
Non-interest revenue:
Service charges on deposit accounts22,539 20,033 
Fiduciary and asset management fees20,277 17,954 
Card fees14,756 11,996 
Brokerage revenue14,655 12,974 
Mortgage banking income5,953 22,315 
Capital markets income5,472 7,505 
Income from bank-owned life insurance6,556 8,843 
Investment securities gains (losses), net— (1,990)
Other non-interest revenue15,126 11,326 
Total non-interest revenue105,334 110,956 
Non-interest expense:
Salaries and other personnel expense164,684 161,477 
Net occupancy, equipment, and software expense42,877 41,134 
Third-party processing and other services20,996 20,032 
Professional fees8,474 9,084 
FDIC insurance and other regulatory fees6,250 5,579 
Restructuring charges(6,424)531 
Other operating expense35,593 29,297 
Total non-interest expense272,450 267,134 
Income before income taxes213,732 236,254 
Income tax expense42,695 49,161 
Net income171,037 187,093 
Less: Preferred stock dividends8,291 8,291 
Net income available to common shareholders$162,746 $178,802 
Net income per common share, basic$1.12 $1.20 
Net income per common share, diluted1.11 1.19 
Weighted average common shares outstanding, basic145,273 148,467 
Weighted average common shares outstanding, diluted146,665 149,780 
See accompanying notes to unaudited interim consolidated financial statements.


2


SYNOVUS FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(unaudited)
Three Months Ended March 31,
20222021
(in thousands)Before-tax AmountIncome TaxNet of Tax AmountBefore-tax AmountIncome TaxNet of Tax Amount
Net income$213,732 $(42,695)$171,037 $236,254 $(49,161)$187,093 
Unrealized gains (losses) on investment securities available for sale:
Net unrealized gains (losses) arising during the period(621,482)147,023 (474,459)(165,241)42,781 (122,460)
Reclassification adjustment for realized (gains) losses included in net income— — — 1,990 (515)1,475 
Net change(621,482)147,023 (474,459)(163,251)42,266 (120,985)
Unrealized gains (losses) on derivative instruments designated as cash flow hedges:
Net unrealized gains (losses) arising during the period(135,978)32,361 (103,617)(29,057)7,874 (21,183)
Reclassification adjustment for realized (gains) losses included in net income(2,189)521 (1,668)(1,599)410 (1,189)
Net change(138,167)32,882 (105,285)(30,656)8,284 (22,372)
Total other comprehensive income (loss)$(759,649)$179,905 $(579,744)$(193,907)$50,550 $(143,357)
Comprehensive income (loss)$(408,707)$43,736 
See accompanying notes to unaudited interim consolidated financial statements.

3


SYNOVUS FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
(unaudited)
(in thousands, except per share data)Preferred StockCommon
Stock		Additional
Paid-in
Capital		Treasury
Stock		Accumulated
Other
Comprehensive
Income (Loss)		Retained EarningsTotal
Balance at December 31, 2021$537,145 $169,384 $3,894,109 $(931,497)$(82,321)$1,709,980 $5,296,800 
Net income— — — — — 171,037 171,037 
Other comprehensive income (loss), net of income taxes— — — — (579,744)— (579,744)
Cash dividends declared on common stock - $0.34 per share— — — — — (49,442)(49,442)
Cash dividends declared on preferred stock(1)
— — — — — (8,291)(8,291)
Repurchases of common stock including costs to repurchase— — — (9,671)— — (9,671)
Restricted share unit vesting and taxes paid related to net share settlement— 302 (4,282)— — (1,742)(5,722)
Stock options exercised, net— 226 1,541 — — — 1,767 
Share-based compensation expense— — 7,901 — — — 7,901 
Balance at March 31, 2022$537,145 $169,912 $3,899,269 $(941,168)$(662,065)$1,821,542 $4,824,635 
Balance at December 31, 2020$537,145 $168,133 $3,851,208 $(731,806)$158,635 $1,178,019 $5,161,334 
Net income— — — — — 187,093 187,093 
Other comprehensive income (loss), net of income taxes— — — — (143,357)— (143,357)
Cash dividends declared on common stock - $0.33 per share— — — — — (49,093)(49,093)
Cash dividends declared on preferred stock(1)
— — — — — (8,291)(8,291)
Restricted share unit vesting and taxes paid related to net share settlement— 271 (6,456)— — — (6,185)
Stock options exercised, net— 574 11,978 — — — 12,552 
Warrants exercised with net settlement and common stock reissued— — (113)116 — (3)— 
Share-based compensation expense— — 7,664 — — — 7,664 
Balance at March 31, 2021$537,145 $168,978 $3,864,281 $(731,690)$15,278 $1,307,725 $5,161,717 
(in thousands, except per share data)Series C Preferred Stock 
Common
Stock
 
Additional
Paid-in
Capital
 
Treasury
Stock
 
Accumulated
Other
Comprehensive
Income (Loss)
 Retained Earnings Total
Balance at December 31, 2015$125,980
 140,592
 2,989,981
 (401,511) (29,819) 174,973
 3,000,196
Net income—
 —
 —
 —
 —
 178,233
 178,233
Other comprehensive income, net of income taxes—
 —
 —
 —
 34,984
 —
 34,984
Cash dividends declared on common stock -$0.36 per share—
 —
 —
 —
 —
 (44,737) (44,737)
Cash dividends paid on Series C Preferred Stock—
 —
 —
 —
 —
 (7,678) (7,678)
Repurchases of common stock—
 —
 (10,581) (252,503) —
 —
 (263,084)
Restricted share unit activity—
 301
 (4,860) —
 —
 (89) (4,648)
Stock options exercised—
 173
 2,808
 —
 —
 —
 2,981
Share-based compensation net tax benefit—
 —
 199
 —
 —
 —
 199
Share-based compensation expense—
 —
 10,213
 —
 —
 —
 10,213
Balance at September 30, 2016$125,980
 141,066
 2,987,760
 (654,014) 5,165
 300,702
 2,906,659
              
Balance at December 31, 2016$125,980
 142,026
 3,028,405
 (664,595) (55,659) 351,767
 2,927,924
Net income—
 —
 —
 —
 —
 245,868
 245,868
Other comprehensive income, net of income taxes—
 —
 —
 —
 16,063
 —
 16,063
Cash dividends declared on common stock - $0.45 per share—
 —
 —
 —
 —
 (54,671) (54,671)
Cash dividends paid on Series C Preferred Stock—
 —
 —
 —
 —
 (7,678) (7,678)
Repurchases of common stock—
 —
 —
 (135,914) —
 —
 (135,914)
Restricted share unit activity—
 335
 (8,007) —
 —
 (290) (7,962)
Stock options exercised—
 164
 2,708
 —
 —
 —
 2,872
Share-based compensation expense—
 —
 10,576
 —
 —
 —
 10,576
Balance at September 30, 2017$125,980
 $142,525
 3,033,682
 (800,509) (39,596) 534,996
 2,997,078
              
(1)    For the three months ended March 31, 2022 and 2021, dividends per share were $0.39 and $0.37 for Series D and Series E Preferred Stock, respectively.
See accompanying notes to unaudited interim consolidated financial statements.


4


SYNOVUS FINANCIAL CORP.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
 Nine Months Ended September 30,
(in thousands)2017 2016
Operating Activities   
Net income$245,868
 178,233
Adjustments to reconcile net income to net cash provided by operating activities:   
Provision for loan losses58,620
 21,741
Depreciation, amortization, and accretion, net44,786
 43,615
Deferred income tax expense114,205
 94,436
Decrease in trading account assets(3,014) (2,212)
Originations of mortgage loans held for sale(490,202) (512,572)
Proceeds from sales of mortgage loans held for sale500,786
 486,690
Gain on sales of mortgage loans held for sale, net(10,587) (10,828)
Increase in other assets(18,598) (38,577)
Increase in other liabilities17,718
 37,068
Investment securities losses (gains), net289
 (126)
Losses and write-downs on other real estate, net9,869
 8,194
Decrease in fair value of private equity investments, net3,193
 527
Losses and write-downs on other assets held for sale, net1,872
 7,205
Loss on early extinguishment of debt, net—
 4,735
Share-based compensation expense10,576
 10,213
Net cash provided by operating activities$485,381
 328,342
    
Investing Activities   
Net decrease (increase) in interest earning deposits with banks12,673
 (988)
Net decrease (increase) in federal funds sold and securities purchased under resale agreements9,240
 (1,934)
Net increase in interest bearing funds with Federal Reserve Bank(770,491) (155,889)
Proceeds from maturities and principal collections of investment securities available for sale483,307
 711,882
Proceeds from sales of investment securities available for sale812,293
 596,824
Purchases of investment securities available for sale(1,195,302) (1,233,236)
Proceeds from sales of loans26,386
 8,433
Proceeds from sales of other real estate8,359
 25,415
Net increase in loans(755,231) (879,200)
Purchases of bank-owned life insurance policies(150,000) —
Net increase in premises and equipment(34,717) (24,491)
Proceeds from sales of other assets held for sale3,158
 5,673
Net cash used in investing activities$(1,550,325) (947,511)
    
Financing Activities   
Net increase in demand and savings deposits335,438
 1,054,389
Net increase (decrease) in certificates of deposit1,202,926
 (105,698)
Net (decrease) increase in federal funds purchased and securities sold under repurchase agreements(18,160) 18,000
Repayments on long-term debt(1,653,613) (1,730,106)
Proceeds from issuance of long-term debt1,375,000
 1,700,000
Dividends paid to common shareholders(36,681) (44,737)
Dividends paid to preferred shareholders(7,678) (7,678)
Stock options exercised2,872
 2,981
Repurchases of common stock(135,914) (263,084)
Restricted stock activity(7,962) (4,648)
Net cash provided by financing activities$1,056,228
 619,419
(Decrease) increase in cash and cash equivalents(8,716) 250
Cash and cash equivalents at beginning of period395,175
 367,092
Cash and cash equivalents at end of period$386,459
 367,342
    

Supplemental Cash Flow Information   
Cash paid during the period for:   
Income tax payments, net$11,195
 6,828
Interest paid101,632
 93,479
Non-cash Activities   
Premises and equipment transferred to other assets held for sale1,063
 23,667
Other assets held for sale transferred to premises and equipment4,450
 —
Loans foreclosed and transferred to other real estate6,571
 15,017
Loans transferred to other loans held for sale at fair value77,774
 10,482
   Securities purchased during the period but settled after period-end193,286
 49,479
   Dividends declared on common stock during the period but paid after period-end17,990
 —
    
Three Months Ended March 31,
(in thousands)20222021
Operating Activities
Net income$171,037 $187,093 
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Provision for (reversal of) credit losses11,400 (18,575)
Depreciation, amortization, and accretion, net27,109 52,395 
Deferred income tax expense (benefit)1,250 17,926 
Originations of loans held for sale(915,873)(1,075,343)
Proceeds from sales and payments on loans held for sale946,187 857,872 
Gain on sales of loans held for sale, net(4,647)(16,293)
(Increase) decrease in other assets(58,709)17,437 
Increase (decrease) in other liabilities(5,433)(11,936)
Investment securities (gains) losses, net— 1,990 
Share-based compensation expense8,334 7,664 
 Other677 — 
Net cash provided by (used in) operating activities181,332 20,230 
Investing Activities
Proceeds from maturities and principal collections of investment securities available for sale642,957 852,628 
Proceeds from sales of investment securities available for sale— 223,977 
Purchases of investment securities available for sale(820,120)(2,125,567)
Proceeds from sales of loans39,568 21,535 
Purchases of loans(181,335)(606,985)
Net (increase) decrease in loans(726,686)5,084 
Net (purchases) redemptions of Federal Home Loan Bank stock(13,827)(1,200)
Net (purchases) redemptions of Federal Reserve Bank stock(424)— 
Net proceeds from settlement (purchases) of bank-owned life insurance policies— 3,784 
Net increase in premises, equipment and software(2,662)(4,027)
Other28,464 1,247 
Net cash provided by (used in) investing activities(1,034,065)(1,629,524)
Financing Activities
Net increase (decrease) in deposits(771,032)677,380 
Net increase in federal funds purchased and securities sold under repurchase agreements236,991 65,737 
Net increase (decrease) in other short-term borrowings400,192 (7,717)
Repayments and redemption of long-term debt(400,000)— 
Dividends paid to common shareholders(47,851)(48,834)
Dividends paid to preferred shareholders(8,291)(8,291)
Repurchases of common stock(9,671)— 
Issuances, net of taxes paid, under equity compensation plans(3,955)6,368 
Net cash provided by (used in) financing activities(603,617)684,643 
Increase (decrease) in cash and cash equivalents including restricted cash(1,456,350)(924,651)
Cash, cash equivalents, and restricted cash, at beginning of period3,009,853 4,252,917 
Cash, cash equivalents, and restricted cash at end of period$1,553,503 $3,328,266 
Supplemental Disclosures:
Income taxes paid$46,493 $48,505 
Interest paid27,278 46,599 
Non-cash Activities
Securities purchased during the period but settled after period-end— 53,699 
Premises and equipment transferred to other assets held for sale11,712 — 
Loans foreclosed and transferred to other real estate— 720 
Loans transferred (from) to other loans held for sale at fair value(1,055)— 
See accompanying notes to unaudited interim consolidated financial statements.


5


Notes to Unaudited Interim Consolidated Financial Statements
Note 1 - SignificantBasis of Presentation and Accounting Policies
Business OperationsGeneral
The accompanying unaudited interim consolidated financial statements of Synovus Financial Corp. include the accounts of the Parent Company and its consolidated subsidiaries. Synovus Financial Corp. is a financial services company based in Columbus, Georgia. Through its wholly-owned subsidiary, Synovus Bank, a Georgia state-chartered bank that is a member of the Federal Reserve System, the companyCompany provides commercial and retailconsumer banking in addition to a full suite of specialized products and services including private banking, treasury management, wealth management, mortgage services, premium finance, asset-based lending, structured lending, and international banking.
Synovus also provides financial planning, and investment advisory services through its wholly-owned subsidiaries, Synovus Trust and Synovus Securities, as well as its GLOBALT and Creative Financial Group divisions. Synovus Bank is positioned in some of the highest growth markets in the Southeast, with 249272 branches and 328370 ATMs in Alabama, Florida, Georgia, Alabama, South Carolina, Florida, and Tennessee.
Basis of Presentation
The accompanying unaudited interim consolidated financial statements have been prepared in accordance with the instructions to the SEC Form 10-Q and Article 10 of Regulation S-X; therefore, they do not include all information and footnotes necessary for a fair presentation of financial position, results of operations, comprehensive income (loss), and cash flows in conformity with GAAP. All adjustments consisting of normally recurring accruals that, in the opinion of management, are necessary for a fair presentation of the consolidated financial position and results of operations for the periods covered by this Report have been included. The accompanying unaudited interim consolidated financial statements should be read in conjunction with the consolidated financial statements and related notes appearing in Synovus' 20162021 Form 10-K. There have been no significant changes
Reclassifications
Prior periods' consolidated financial statements are reclassified whenever necessary to conform to the accounting policies as disclosedcurrent periods' presentation.
Use of Estimates in Synovus' 2016 Form 10-K.the Preparation of Financial Statements
In preparing the unaudited interim consolidated financial statements in accordance with GAAP, management is required to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities as of the date of the respective consolidated balance sheets and the reported amounts of revenuesrevenue and expensesexpense for the periods presented. Actual results could differ significantly from those estimates.
Material estimates that are particularly susceptible to significant change relate to the determination of the allowance for loan losses, theACL, estimates of fair value, of investment securities, and the fair value of private equity investments.
Cash and Cash Equivalents
Cash and cash equivalents consist of cash and due from banks. At December 31, 2016, $533 thousand of the due from banks balance was restricted as to withdrawal. There were no cash and cash equivalents restricted as to withdrawal at September 30, 2017.
Short-term Investments
Short-term investments consist of interest bearing funds with the Federal Reserve Bank, interest earning deposits with banks, and federal funds sold and securities purchased under resale agreements. At September 30, 2017 and December 31, 2016, interest bearing funds with the Federal Reserve Bank included $57.7 million and $130.0 million, respectively, on deposit to meet Federal Reserve Bank requirements. Interest earning deposits with banks include $6.0 million and $5.6 million at September 30, 2017 and December 31, 2016, respectively, which are pledged as collateral in connection with certain letters of credit. Federal funds sold include $45.8 million and $56.1 million at September 30, 2017 and December 31, 2016, respectively, which are pledged to collateralize certain derivative financial instruments. Federal funds sold and securities purchased under resale agreements, and federal funds purchased and securities sold under repurchase agreements, generally mature in one day.
Recently Adopted Accounting Standards Updates
During 2016, the FASB issued ASU 2016-09, Compensation-Stock Compensation: Improvements to Employee Share-Based Payment Accounting. ASU 2016-09 simplified various aspects of the accounting for employee share-based payment transactions for both public and nonpublic entities, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classificationcontingent liabilities.
Recent Accounting Pronouncements
The following table provides a brief description of accounting standards adopted or issued in the statement of cash flows. This accounting standard update included2022 that could have a requirement to record all tax effects associated with share-based compensation through the income statement. Prior to 2017, tax benefits in excess of compensation cost (“windfalls”) and tax deficiencies (“shortfalls”) were recorded in equity. During the nine and three months ended September 30, 2017, Synovus recognized $4.7 million and $211 thousand, respectively, of income tax benefits from excess tax benefits that occurred during the nine months ended September 30, 2017 from the vesting of restricted share units and exercise of stock options. As of January 1, 2017, Synovus had no previously unrecognized excess tax benefits. Additionally, beginning January 1, 2017, Synovus modified the denominator in the diluted earnings per common share calculation under the treasury stock method to exclude future excess tax benefits as part of the assumed proceeds. Synovus elected to retain its existing accounting policy election to estimate award forfeitures.

During 2015, the FASB issued ASU 2015-17, Income Taxes: Balance Sheet Classification of Deferred Taxes, which became effective January 1, 2017. ASU 2015-17 required deferred income tax liabilities and assets be classified as noncurrent in the statement of financial position instead of separating deferred taxes into current and noncurrent amounts. Also, valuation allowances will no longer be classified between current and noncurrent because these allowances will be required to be classified as noncurrent under the new standard. This ASU only impacts classification in the balance sheet, and has no impact on required deferred tax footnote disclosures (i.e., required presentation of “gross” deferred tax assets and “gross” deferred tax liabilities). The current requirement that deferred tax liabilities and assets of a tax-paying component of an entity be offset and presented as a single amount is not affected by this ASU. There is nomaterial impact to our balance sheet as a result of this standard because Synovus has not historically distinguished deferred taxes on the balance sheet as current vs. non-current.
Reclassifications
Prior periods'Company's consolidated financial statements are reclassified whenever necessary to conform toupon adoption in the current periods' presentation.future.


6


StandardDescriptionRequired date of adoptionEffect on Company's financial statements or other significant matters
Standards Adopted (or partially adopted )
ASU 2021-01, Reference Rate Reform (Topic 848)In January 2021, the FASB issued ASU 2021-01 which provides optional expedients and exceptions in Topic 848 for derivative instruments and hedge accounting modifications resulting from the discounting transition of reference rate reform.This ASU is effective upon issuance and can be applied through December 31, 2022.The Company is in the process of evaluating and applying, as applicable, the optional expedients and exceptions in accounting for eligible contract modifications, eligible existing hedging relationships and new hedging relationships. The application of this guidance has not had and is not expected to have a material impact to the consolidated financial statements.
StandardDescriptionRequired date of adoptionEffect on Company's financial statements or other significant matters
Standards Issued But Not Yet Adopted
ASU 2022-02, Financial Instruments – Credit Losses (Topic 326): Troubled Debt Restructurings and Vintage DisclosureIn March 2022, the FASB issued ASU 2022-02 to eliminate TDR accounting guidance while enhancing disclosure requirements for certain loan refinancings and restructurings by creditors when a borrower is experiencing financial difficulty. The ASU also provides guidance for vintage table disclosures and gross write-offs. The ASU requires an entity to disclose current-period gross write-offs by year of origination for financing receivables within the scope of Subtopic 326-20.January 1, 2023. Early adoption is permitted as of an interim period with retrospective application back to the beginning of the fiscal year.The Company is currently evaluating the potential financial statement impact from the implementation of this standard.
SAB 121, Accounting for Obligations to Safeguard Crypto-Assets an Entity Holds for its Platform UsersIn March 2022, the SEC released SAB 121 to add interpretive guidance for entities to consider when they have obligations to safeguard crypto-assets held for clients. The new guidance requires reporting entities who allow clients to transact in crypto-assets and act as a custodian to record a liability with a corresponding asset regardless of whether they control the crypto-asset. The crypto-asset will need to be marked at fair value for each reporting period. The new guidance requires disclosures in the footnotes to address the amount of crypto-assets reported, and the safeguarding and recordkeeping of the assets.June 30, 2022, with retrospective application back to the beginning of the fiscal year.The Company is currently evaluating the potential financial statement impact from the implementation of this standard.


7


Note 2 - Acquisitions
Cabela's Transaction
On September 25, 2017, Synovus' wholly owned subsidiary, Synovus Bank, completed the acquisition of certain assets and assumption of certain liabilities of WFB. Immediately following the closing of this transaction, Synovus Bank sold WFB’s credit card assets and related liabilities to Capital One Bank (USA), National Association, a bank subsidiary of Capital One Financial Corporation.
Synovus retained WFB’s $1.10 billion brokered time deposits portfolio, which had a weighted average remaining maturity of approximately 2.53 years and a weighted average rate of 1.83% as of September 25, 2017. The transaction was accountedInvestment Securities Available for as an assumption of a liability (accounted for under the asset acquisition model). In accordance with ASC 820, Fair Value Measurements and Disclosures, the brokered time deposit portfolio was recorded at $1.10 billion, which was the amount of cash received for the deposits and represented the estimated fair value of the deposits at the transaction date. Additionally, Synovus received a $75.0 million transaction fee from Cabela’s and Capital One, which was recognized into earnings upon closing of the transaction, based on having achieved the recognition criteria outlined in SEC SAB Topic 13.A, Revenue Recognition.
Acquisition of Global One
On October 1, 2016, Synovus completed its acquisition of all of the outstanding stock of Global One. Prior to its acquisition, Global One was an Atlanta-based private specialty financial services company that lended primarily to commercial entities, with all loans fully collateralized by cash value life insurance policies and/or annuities issued by investment grade life insurance companies. Under the terms of the merger agreement, Synovus acquired Global One for an up-front payment of $30 million, consisting of the issuance of 821 thousand shares of Synovus common stock valued at $26.6 million and $3.4 million in cash, with additional payments to Global One's former shareholders over the next three to five years based on earnings from the Global One business as further discussed below.
The acquisition of Global One constituted a business combination. Accordingly, the assets acquired and liabilities assumed were recorded at their estimated fair values as shown in the following table. The determination of fair value required management to make estimates about discount rates, future expected earnings and cash flows, market conditions, future loan growth, and other future events that are highly subjective in nature and subject to change. These fair value estimates reflect measurement period adjustments to the amounts reported as of December 31, 2016, the most significant of which consist of a reduction in goodwill of $2.4 million and a decrease in the estimated fair value of contingent consideration of $1.8 million (the income statement impact of such adjustments was insignificant).

Global One October 1, 2016
(in thousands) Fair Value
Assets acquired:  
Cash and due from banks $9,554
      Commercial and industrial loans(1)
 357,307
Goodwill(2)
 32,884
Other intangible assets 12,500
Other assets 3,681
Total assets acquired $415,926
   
Liabilities assumed:  
Notes payable(3)
 $358,560
Contingent consideration 12,234
Deferred tax liability, net 3,229
Other liabilities 11,903
Total liabilities assumed $385,926
Consideration paid $30,000
   
Cash paid $3,408
Fair value of common stock issued 26,592
   
(1) The unpaid principal balance of the loans was $356.7 million.
(2) The goodwill is not expected to be deductible for tax purposes.
(3) The unpaid principal balance of the notes payable was $357.0 million.
Under the terms of the merger agreement, the purchase price includes additional annual payments ("Earnout Payments") to Global One's former shareholders over the next three to five years, with amounts based on a percentage of "Global One Earnings," as defined in the merger agreement. The Earnout Payments will consist of shares of Synovus common stock as well as a smaller cash consideration component.
Other intangible assets consist of existing borrower relationships (11 years useful life), trade name (10 years useful life), and distribution network (8 years useful life) with September 30, 2017 net carrying values of $9.8 million, $990 thousand, and $525 thousand, respectively.
The following is a description of the methods used to determine the fair values of significant assets and liabilities:
Commercial and industrial loans: The fair value of loans was determined based on a discounted cash flow approach. The most significant assumptions used in the valuation of the loan portfolio consisted of the prepayment rate, the probability of extension at maturity, the interest rates on extended loans, and the discount rates. All loans are fully collateralized by cash value life insurance policies and/or annuities issued by investment grade insurance companies. Based on a history of no principal losses on the loan portfolio since inception as well as the collateral position, no losses were estimated in the event of default.
Notes payable: The notes payable were extinguished immediately after the closing of the acquisition. Accordingly, the fair value of notes payable was determined based on the amounts paid to extinguish such notes, inclusive of applicable prepayment penalties, which is consistent with the perspective of a market participant.
Contingent consideration: The fair value of the contingent consideration, which represents the fair value of the above referenced Earnout Payments, was determined based on option pricing methods and a Monte Carlo simulation. The most significant assumptions used in the valuation of the contingent consideration were the expected cash flows, volatility, and discount rates. Subsequent changes in the fair value of the contingent consideration are recognized in earnings until the contingent consideration arrangement is settled.
Note 3 - Share Repurchase Program
Synovus' Board of Directors authorized an up to $200 million share repurchase program that will expire at the end of 2017. This program was announced on January 17, 2017. As of September 30, 2017, Synovus had repurchased under this program a total of $135.9 million, or 3.2 million shares, at an average price of $42.47 per share.

Note 4 - Investment SecuritiesSale
The amortized cost, gross unrealized gains and losses, and estimated fair values of investment securities available for sale at September 30, 2017March 31, 2022 and December 31, 20162021 are summarized below.
March 31, 2022
(in thousands)Amortized CostGross Unrealized GainsGross Unrealized LossesFair Value
U.S. Treasury securities$414,397 $— $(19,811)$394,586 
U.S. Government agency securities52,865 411 (1,471)51,805 
Mortgage-backed securities issued by U.S. Government agencies733,289 60 (46,605)686,744 
Mortgage-backed securities issued by U.S. Government sponsored enterprises8,169,609 4,937 (553,915)7,620,631 
Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises877,362 326 (54,810)822,878 
Commercial mortgage-backed securities issued by U.S. Government agencies or sponsored enterprises554,868 1,020 (25,092)530,796 
Asset-backed securities337,037 — — 337,037 
Corporate debt securities and other debt securities18,333 291 — 18,624 
Total investment securities available for sale$11,157,760 $7,045 $(701,704)$10,463,101 
December 31, 2021
(in thousands)Amortized CostGross Unrealized GainsGross Unrealized LossesFair Value
U.S. Treasury securities$120,465 $— $(2,627)$117,838 
U.S. Government agency securities53,214 1,374 (387)54,201 
Mortgage-backed securities issued by U.S. Government agencies790,329 768 (11,464)779,633 
Mortgage-backed securities issued by U.S. Government sponsored enterprises8,063,890 50,491 (102,080)8,012,301 
Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises951,691 4,658 (16,726)939,623 
Commercial mortgage-backed securities issued by U.S. Government agencies or sponsored enterprises479,420 8,644 (6,320)481,744 
Asset-backed securities514,188 — — 514,188 
Corporate debt securities and other debt securities18,309 492 — 18,801 
Total investment securities available for sale$10,991,506 $66,427 $(139,604)$10,918,329 
  September 30, 2017
(in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses  Fair Value
U.S. Treasury securities $83,550
 —
 (369) 83,181
U.S. Government agency securities 10,772
 266
 —
 11,038
Mortgage-backed securities issued by U.S. Government agencies 127,521
 715
 (852) 127,384
Mortgage-backed securities issued by U.S. Government sponsored enterprises 2,663,959
 7,917
 (20,024) 2,651,852
Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises 943,583
 —
 (12,143) 931,440
State and municipal securities 180
 1
 —
 181
Corporate debt and other securities 20,297
 286
 (216) 20,367
Total investment securities available for sale $3,849,862
 9,185
 (33,604) 3,825,443
         
  December 31, 2016
(in thousands) Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value
U.S. Treasury securities $108,221
 225
 (644) 107,802
U.S. Government agency securities 12,727
 266
 —
 12,993
Mortgage-backed securities issued by U.S. Government agencies 174,440
 1,116
 (1,354) 174,202
Mortgage-backed securities issued by U.S. Government sponsored enterprises 2,543,495
 5,416
 (42,571) 2,506,340
Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises 905,789
 1,214
 (16,561) 890,442
State and municipal securities 2,780
 14
 —
 2,794
Equity securities 919
 2,863
 —
 3,782
Corporate debt and other securities 20,247
 —
 (407) 19,840
Total investment securities available for sale $3,768,618
 11,114
 (61,537) 3,718,195
         
At September 30, 2017March 31, 2022 and December 31, 2016,2021, investment securities with a carrying value of $1.69$3.74 billion and $2.04$4.03 billion, respectively, were pledged to secure certain deposits and securities sold under repurchase agreementsother liabilities, as required by law andor contractual agreements.
Synovus has reviewed

8


Gross unrealized losses on investment securities and the fair value of the related securities, aggregated by investment category and length of time that areindividual securities have been in ana continuous unrealized loss position, as of September 30, 2017at March 31, 2022 and December 31, 2016 for OTTI and does not consider any2021 are presented below.
March 31, 2022
Less than 12 Months12 Months or LongerTotal
(in thousands)Fair ValueGross Unrealized LossesFair ValueGross Unrealized LossesFair ValueGross Unrealized Losses
U.S. Treasury securities$328,920 $(14,282)$44,313 $(5,529)$373,233 $(19,811)
U.S. Government agency securities20,691 (1,471)— — 20,691 (1,471)
Mortgage-backed securities issued by U.S. Government agencies316,662 (19,328)365,096 (27,277)681,758 (46,605)
Mortgage-backed securities issued by U.S. Government sponsored enterprises5,225,550 (365,535)1,966,572 (188,380)7,192,122 (553,915)
Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises366,174 (18,823)441,167 (35,987)807,341 (54,810)
Commercial mortgage-backed securities issued by U.S. Government agencies or sponsored enterprises224,955 (8,847)146,528 (16,245)371,483 (25,092)
Total$6,482,952 $(428,286)$2,963,676 $(273,418)$9,446,628 $(701,704)
December 31, 2021
Less than 12 Months12 Months or LongerTotal
(in thousands)Fair ValueGross Unrealized LossesFair ValueGross Unrealized LossesFair ValueGross Unrealized Losses
U.S. Treasury securities$49,648 $(379)$47,590 $(2,248)$97,238 $(2,627)
U.S. Government agency securities21,760 (387)— — 21,760 (387)
Mortgage-backed securities issued by U.S. Government agencies461,078 (5,858)244,264 (5,606)705,342 (11,464)
Mortgage-backed securities issued by U.S. Government sponsored enterprises5,729,476 (82,671)643,758 (19,409)6,373,234 (102,080)
Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises187,431 (3,981)504,238 (12,745)691,669 (16,726)
Commercial mortgage-backed securities issued by U.S. Government agencies or sponsored enterprises146,672 (2,951)83,533 (3,369)230,205 (6,320)
Total$6,596,065 $(96,227)$1,523,383 $(43,377)$8,119,448 $(139,604)
As of March 31, 2022, Synovus had 227 investment securities in an unrealizeda loss position to be other-than-temporarily impaired. If Synovus intended to sellfor less than twelve months and 76 investment securities in a security in an unrealized loss position the entire unrealized loss would be reflected in earnings.for twelve months or longer. Synovus does not intend to sell investment securities in an unrealized loss position prior to the recovery of the unrealized loss, which may not be until maturity, and has the ability and intent to hold those securities for that period of time. Additionally, Synovus is not currently aware of any circumstances which will require it to sell any of the securities that are in an unrealized loss position prior to the respective securities' recovery of all such unrealized losses.
Declines in the fair value of available for sale securities below their cost that are deemed to have OTTI are reflected in earnings as realized losses As such, no write-downs to the extent the impairment is related to credit losses. The amountamortized cost basis of the impairment related to other factors is recognized in other comprehensive income. Currently,portfolio were recorded at March 31, 2022.
At March 31, 2022, 0 ACL was established for investment securities. Substantially all of the unrealized losses on debt the securities portfolio were the result of changes in market interest rates compared to the date the securities were acquired rather than the credit quality of the issuers or underlying loans. U.S. Treasury and agency securities and agency mortgage-backed

9


securities are attributable to increases in interest rates on comparable securities fromissued, guaranteed or otherwise supported by the date of purchase. Synovus regularly evaluates its investment securities portfolio to ensure that there are no conditions that would indicate that unrealized losses represent OTTI. These factors include the length of time the security has been in a loss position, the extent that the fair value is below amortized cost, and the credit standingUnited States government, an agency of the issuer. As of September 30, 2017, Synovus had 75 investment securities inUnited States government, or a loss position for less than twelve months and 13 investment securities in a loss position for twelve months or longer.

Gross unrealized losses on investment securities and the fair value of the related securities, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, at September 30, 2017 and December 31, 2016 are presented below.
 September 30, 2017
 Less than 12 Months 12 Months or Longer Total
(in thousands)
Fair
Value
 
Gross Unrealized
Losses
 
Fair
Value
 
Gross Unrealized
Losses
 
Fair
Value
 
Gross Unrealized
Losses
U.S. Treasury securities$64,351
 369
 —
 —
 64,351
 369
Mortgage-backed securities issued by U.S. Government agencies80,303
 552
 7,636
 300
 87,939
 852
Mortgage-backed securities issued by U.S. Government sponsored enterprises1,696,906
 19,128
 48,596
 896
 1,745,502
 20,024
Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises569,191
 5,617
 240,355
 6,526
 809,546
 12,143
Corporate debt and other securities—
 —
 5,081
 216
 5,081
 216
    Total$2,410,751
 25,666
 301,668
 7,938
 2,712,419
 33,604
            
 December 31, 2016
 Less than 12 Months 12 Months or Longer Total
(in thousands)
Fair
Value
 
Gross Unrealized
Losses
 
Fair
Value
 
Gross Unrealized
Losses
 
Fair
Value
 
Gross Unrealized
Losses
U.S. Treasury securities$64,023
 644
 —
 —
 64,023
 644
Mortgage-backed securities issued by U.S. Government agencies128,121
 1,240
 3,626
 114
 131,747
 1,354
Mortgage-backed securities issued by U.S. Government sponsored enterprises2,123,181
 42,571
 —
 —
 2,123,181
 42,571
Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises682,492
 15,653
 24,801
 908
 707,293
 16,561
Corporate debt and other securities14,952
 48
 4,888
 359
 19,840
 407
Total$3,012,769
 60,156
 33,315
 1,381
 3,046,084
 61,537
            

government sponsored enterprise.
The amortized cost and fair value by contractual maturity of investment securities available for sale at September 30, 2017March 31, 2022 are shown below. The expected life of mortgage-backed securitiesMBSs or CMOs may differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties. For purposes of the maturity table, mortgage-backed securitiesMBSs and CMOs, which are not due at a single maturity date, have been classified based on the final contractual maturity date.
Distribution of Maturities at March 31, 2022
(in thousands)Within One
 Year		1 to 5
Years		5 to 10
 Years		More Than
 10 Years		Total
Amortized Cost
U.S. Treasury securities$21,353 $343,202 $49,842 $— $414,397 
U.S. Government agency securities455 273 52,137 — 52,865 
Mortgage-backed securities issued by U.S. Government agencies— 835 — 732,454 733,289 
Mortgage-backed securities issued by U.S. Government sponsored enterprises11 — 136,502 8,033,096 8,169,609 
Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises— 129 — 877,233 877,362 
Commercial mortgage-backed securities issued by U.S. Government agencies or sponsored enterprises— 251,596 225,872 77,400 554,868 
Asset-backed securities337,037 — — — 337,037 
Corporate debt securities and other debt securities9,501 — 8,832 — 18,333 
Total amortized cost$368,357 $596,035 $473,185 $9,720,183 $11,157,760 
Fair Value
U.S. Treasury securities$21,353 $328,920 $44,313 $— $394,586 
U.S. Government agency securities462 275 51,068 — 51,805 
Mortgage-backed securities issued by U.S. Government agencies— 845 — 685,899 686,744 
Mortgage-backed securities issued by U.S. Government sponsored enterprises11 — 134,665 7,485,955 7,620,631 
Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises— 130 — 822,748 822,878 
Commercial mortgage-backed securities issued by U.S. Government agencies or sponsored enterprises— 244,983 209,622 76,191 530,796 
Asset-backed securities337,037 — — — 337,037 
Corporate debt securities and other debt securities9,506 — 9,118 — 18,624 
Total fair value$368,369 $575,153 $448,786 $9,070,793 $10,463,101 
 Distribution of Maturities at September 30, 2017
(in thousands)
Within One
Year
 
1 to 5
Years
 
5 to 10
Years
 
More Than
10 Years
 
No Stated
Maturity
 Total
Amortized Cost           
U.S. Treasury securities$18,830
 64,720
 —
 —
 —
 83,550
U.S. Government agency securities2,331
 6,437
 2,004
 —
 —
 10,772
Mortgage-backed securities issued by U.S. Government agencies—
 —
 32,956
 94,565
 —
 127,521
Mortgage-backed securities issued by U.S. Government sponsored enterprises44
 2,015
 446,255
 2,215,645
 —
 2,663,959
Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises—
 —
 20,910
 922,673
 —
 943,583
State and municipal securities180
 —
 —
 —
 —
 180
Corporate debt and other securities—
 —
 15,000
 2,000
 3,297
 20,297
Total amortized cost$21,385
 73,172
 517,125
 3,234,883
 3,297
 3,849,862
            
Fair Value           
U.S. Treasury securities$18,830
 64,351
 —
 —
 —
 83,181
U.S. Government agency securities2,385
 6,529
 2,124
 —
 —
 11,038
Mortgage-backed securities issued by U.S. Government agencies—
 —
 33,073
 94,311
 —
 127,384
Mortgage-backed securities issued by U.S. Government sponsored enterprises45
 2,127
 444,701
 2,204,979
 —
 2,651,852
Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises—
 —
 20,666
 910,774
 —
 931,440
State and municipal securities181
 —
 —
 —
 —
 181
Corporate debt and other securities—
 —
 15,286
 1,919
 3,162
 20,367
Total fair value$21,441
 73,007
 515,850
 3,211,983
 3,162
 3,825,443
            
Proceeds from sales, grossGross gains and gross losses on sales of securities available for sale for the nine and three months ended September 30, 2017March 31, 2022 and 20162021 are presented below. The specific identification method is used to reclassify gains and losses out of other comprehensive income (loss) at the time of sale.
Three Months Ended March 31,
(in thousands)20222021
Gross realized gains on sales$— $— 
Gross realized losses on sales— (1,990)
Investment securities gains (losses), net$— $(1,990)


10

  Nine Months Ended September 30, Three Months Ended September 30,
(in thousands) 2017 2016 2017 2016
Proceeds from sales of investment securities available for sale $812,293
 596,824
 $473,912
 353,215
Gross realized gains on sales 7,942
 2,590
 —
 1,635
Gross realized losses on sales (8,231) (2,464) (7,956) (1,576)
Investment securities (losses) gains, net $(289) 126
 $(7,956) 59
         

Note 5 - Restructuring Charges
For the nine and three months ended September 30, 2017 and 2016, total restructuring charges consist of the following components:

 Nine Months Ended September 30, Three Months Ended September 30,
(in thousands)2017 2016 2017 2016
Severance charges$6,428
 —
 $(24) —
Asset impairment charges511
 8,120
 515
 1,240
Other charges104
 105
 28
 3
Total restructuring charges, net$7,043
 8,225
 $519
 1,243
        
Restructuring charges of $7.0 million were recorded during the nine months ended September 30, 2017 consisting primarily of severance charges of $6.4 million recorded during the first quarter of 2017. Severance charges included $6.2 million for termination benefits incurred in conjunction with a voluntary early retirement program offered during the first quarter of 2017. This program was part of Synovus' ongoing efficiency initiatives. The $6.2 million accrual was based on the benefits to be paid to employees who accepted the early retirement offer on or prior to the expiration of the program on March 30, 2017. The accrual balance for severance charges associated with the voluntary early retirement program was $1.2 million at September 30, 2017. For the three months ended September 30, 2017, Synovus recorded restructuring charges of $519 thousand due to additional asset impairment charges of $515 thousand on properties previously identified for disposition. During the nine months ended September 30, 2016, Synovus recorded restructuring charges of $8.2 million with $4.8 million of those charges related to corporate real estate optimization activities and $3.3 million associated with branch closures.
The following tables present aggregate activity within the accrual for restructuring charges for the nine and three months ended September 30, 2017 and 2016:
(in thousands)Severance Charges Lease Termination Charges Total
Balance at December 31, 2016$81
 3,968
 4,049
Accruals for voluntary and involuntary termination benefits6,428
 —
 6,428
Payments(5,304) (540) (5,844)
Balance at September 30, 2017$1,205
 3,428
 4,633
      
Balance at July 1, 20173,731
 3,530
 7,261
Accruals for voluntary and involuntary termination benefits(24) —
 (24)
Payments(2,502) (102) (2,604)
Balance at September 30, 2017$1,205
 3,428
 4,633
      
(in thousands)Severance Charges Lease Termination Charges Total
Balance at December 31, 2015$1,930
 4,687
 6,617
Accruals for lease terminations—
 6
 6
Payments(1,702) (533) (2,235)
Balance at September 30, 2016$228
 4,160
 4,388
      
Balance at July 1, 2016593
 4,375
 4,968
Accruals for lease terminations—
 (25) (25)
Payments(365) (190) (555)
Balance at September 30, 2016$228
 4,160
 4,388
      
All other charges were paid in the quarters that they were incurred. No other restructuring charges resulted in payment accruals.

Note 63 - Loans and Allowance for Loan Losses
Aging and Non-Accrual Analysis
The following istables provide a summary of current, accruing past due, and non-accrual loans by portfolio class as of September 30, 2017March 31, 2022 and December 31, 2016.2021.
March 31, 2022
(in thousands)CurrentAccruing 30-89 Days Past DueAccruing 90 Days or Greater Past DueTotal Accruing Past DueNon-accrual with an ALLNon-accrual without an ALLTotal
Commercial, financial and agricultural$12,585,055 $9,298 $370 $9,668 $42,697 $22,191 $12,659,611 
Owner-occupied7,677,569 4,291 — 4,291 6,906 3,948 7,692,714 
Total commercial and industrial20,262,624 13,589 370 13,959 49,603 26,139 20,352,325 
Investment properties10,037,457 1,931 469 2,400 4,923 2,365 10,047,145 
1-4 family properties616,706 1,424 302 1,726 2,242 — 620,674 
Land and development474,875 571 — 571 2,053 — 477,499 
Total commercial real estate11,129,038 3,926 771 4,697 9,218 2,365 11,145,318 
Consumer mortgages5,017,739 4,114 153 4,267 29,997 — 5,052,003 
Home equity1,404,435 3,052 — 3,052 8,851 3 1,416,341 
Credit cards185,859 1,174 1,214 2,388 — — 188,247 
Other consumer loans1,991,939 16,463 559 17,022 5,955 — 2,014,916 
Total consumer8,599,972 24,803 1,926 26,729 44,803 3 8,671,507 
Loans, net of deferred fees and costs$39,991,634 $42,318 $3,067 $45,385 $103,624 $28,507 $40,169,150 
December 31, 2021
(in thousands)CurrentAccruing 30-89 Days Past DueAccruing 90 Days or Greater Past DueTotal Accruing Past DueNon-accrual with an ALLNon-accrual without an ALLTotal
Commercial, financial and agricultural$12,068,740 $13,378 $3,953 $17,331 $37,918 $23,869 $12,147,858 
Owner-occupied7,460,184 3,627 59 3,686 7,146 4,050 7,475,066 
Total commercial and industrial19,528,924 17,005 4,012 21,017 45,064 27,919 19,622,924 
Investment properties9,894,924 1,285 717 2,002 3,273 2,577 9,902,776 
1-4 family properties639,631 1,182 93 1,275 4,535 28 645,469 
Land and development463,949 845 154 999 1,918 — 466,866 
Total commercial real estate10,998,504 3,312 964 4,276 9,726 2,605 11,015,111 
Consumer mortgages5,033,537 6,257 126 6,383 29,078 — 5,068,998 
Home equity1,349,027 2,619 — 2,619 9,773 — 1,361,419 
Credit cards201,929 1,233 1,010 2,243 — — 204,172 
Other consumer loans2,011,430 20,369 658 21,027 6,877 — 2,039,334 
Total consumer8,595,923 30,478 1,794 32,272 45,728 — 8,673,923 
Loans, net of deferred fees and costs$39,123,351 $50,795 $6,770 $57,565 $100,518 $30,524 $39,311,958 
Interest income on non-accrual loans outstanding that would have been recorded if the loans had been current and performing in accordance with their original terms was $3.1 million and $3.4 million for the three months ended March 31, 2022 and 2021, respectively. Of the interest income recognized during the three months ended March 31, 2022 and 2021, cash-basis interest income was $347 thousand and $622 thousand, respectively.
Pledged Loans
Loans with carrying values of $14.58 billion and $14.19 billion, respectively, were pledged as collateral for borrowings and capacity at March 31, 2022 and December 31, 2021, respectively, to the FHLB and Federal Reserve Bank.

11


Current, Accruing Past Due, and Non-accrual Loans 
 September 30, 2017 
(in thousands)Current Accruing 30-89 Days Past Due Accruing 90 Days or Greater Past Due Total Accruing Past Due Non-accrual  Total 
Investment properties$5,919,393
 3,454
 186
 3,640
 2,063
 5,925,096
 
1-4 family properties784,520
 6,588
 796
 7,384
 2,712
 794,616
 
Land and development494,488
 5,732
 65
 5,797
 6,927
 507,212
 
Total commercial real estate7,198,401
 15,774
 1,047
 16,821
 11,702
 7,226,924
 
Commercial, financial and agricultural6,871,204
 30,010
 2,356
 32,366
 58,139
 6,961,709
 
Owner-occupied4,751,269
 9,586
 618
 10,204
 3,960
 4,765,433
 
Total commercial and industrial11,622,473
 39,596
 2,974
 42,570
 62,099
 11,727,142
 
Home equity lines1,505,556
 7,535
 160
 7,695
 15,638
 1,528,889
 
Consumer mortgages2,545,986
 5,225
 137
 5,362
 6,332
 2,557,680
 
Credit cards222,176
 2,312
 1,237
 3,549
 —
 225,725
 
Other consumer loans1,234,355
 8,726
 130
 8,856
 2,067
 1,245,278
 
Total consumer5,508,073
 23,798
 1,664
 25,462
 24,037
 5,557,572
 
Total loans$24,328,947
 79,168
 5,685
 84,853
 97,838
 24,511,638
(1 
) 
             
 December 31, 2016 
(in thousands)Current Accruing 30-89 Days Past Due Accruing 90 Days or Greater Past Due Total Accruing Past Due Non-accrual  Total 
Investment properties$5,861,198
 2,795
 —
 2,795
 5,268
 5,869,261
 
1-4 family properties873,231
 4,801
 161
 4,962
 9,114
 887,307
 
Land and development598,624
 1,441
 —
 1,441
 16,233
 616,298
 
Total commercial real estate7,333,053
 9,037
 161
 9,198
 30,615
 7,372,866
 
Commercial, financial and agricultural6,839,699
 9,542
 720
 10,262
 59,074
 6,909,035
 
Owner-occupied4,601,356
 17,913
 244
 18,157
 16,503
 4,636,016
 
Total commercial and industrial11,441,055
 27,455
 964
 28,419
 75,577
 11,545,051
 
Home equity lines1,585,228
 10,013
 473
 10,486
 21,551
 1,617,265
 
Consumer mortgages2,265,966
 7,876
 81
 7,957
 22,681
 2,296,604
 
Credit cards229,177
 1,819
 1,417
 3,236
 —
 232,413
 
Other consumer loans809,419
 5,771
 39
 5,810
 2,954
 818,183
 
Total consumer4,889,790
 25,479
 2,010
 27,489
 47,186
 4,964,465
 
Total loans$23,663,898
 61,971
 3,135
 65,106
 153,378
 23,882,382
(2 
) 
             
Portfolio Segment Risk Factors
(1) Total before net deferred feesThe risk characteristics and costscollateral information of $24.3 million.each portfolio segment are as follows:
(2) Total before net deferred feesCommercial and costsIndustrial Loans - The C&I loan portfolio is primarily comprised of $26.0 million.general middle market and commercial banking clients across a diverse set of industries. In accordance with Synovus' lending policy, each loan undergoes a detailed underwriting process which incorporates uniform underwriting standards and oversight in proportion to the size and complexity of the lending relationship. These loans are secured by collateral such as business equipment, inventory, and real estate. Credit decisions on loans in the C&I portfolio are based on cash flow from the operations of the business as the primary source of repayment of the debt, with underlying real estate or other collateral being the secondary source of repayment. PPP loans, which are categorized as C&I loans, were $202.9 million at March 31, 2022 and are guaranteed by the SBA.

Commercial Real Estate Loans - CRE loans primarily consist of income-producing investment properties loans. Additionally, CRE loans include 1-4 family properties loans as well as land and development loans. Investment properties loans consist of construction and mortgage loans for income-producing properties and are primarily made to finance multi-family properties, hotels, office buildings, shopping centers, warehouses and other commercial development properties. 1-4 family properties loans include construction loans to homebuilders and commercial mortgage loans related to 1-4 family rental properties and are almost always secured by the underlying property being financed by such loans. These properties are primarily located in the markets served by Synovus. Land and development loans include commercial and residential development as well as land acquisition loans and are secured by land held for future development, typically in excess of one year. Properties securing these loans are substantially within markets served by Synovus, and loan terms generally include personal guarantees from the principals. Loans in this portfolio are underwritten based on the LTV of the collateral and the capacity of the guarantor(s).

Consumer Loans - The consumer loan portfolio consists of a wide variety of loan products offered through Synovus' banking network including first and second residential mortgages, home equity, and consumer credit card loans, as well as home improvement loans, student, personal, and auto loans from third-party lending ("other consumer loans"). Together, consumer mortgages and home equity comprise the majority of Synovus' consumer loans and are secured by first and second liens on residential real estate primarily located in the markets served by Synovus. The primary source of repayment for all consumer loans is generally the personal income of the borrower(s).





Credit Quality Indicators
The credit quality of the loan portfolio is reviewed and updated no less frequently than quarterlyannually using the standard asset classification system utilized by the federal banking agencies. These classifications are divided into three groups –groups: Not Criticized (Pass), Special Mention, and Classified or Adverse rating (Substandard, Doubtful, and Loss) and are defined as follows:
Pass- loans which are well protected by the current net worth and paying capacity of the obligor (or guarantors, if any) or by the fair value, less cost to acquire and sell in a timely manner, of any underlying collateral.
Special Mention - loans which have potential weaknesses that deserve management's close attention. These loans are not adversely classified and do not expose an institution to sufficient risk to warrant an adverse classification.
Substandard - loans which are inadequately protected by the current net worth and paying capacity of the obligor or by the collateral pledged, if any. Loans with this classification are characterized by the distinct possibility that the institution will sustain some loss if the deficiencies are not corrected.
Doubtful - loans which have all the weaknesses inherent in loans classifiedcategorized as Substandard with the added characteristic that the weaknesses make collection or liquidation in full highly questionable and improbable on the basis of currently known facts, conditions, and values.
Loss - loans which are considered by management to be uncollectible and of such little value that their continuance on the institution's books as an asset, without establishment of a specific valuation allowance or charge-off, is not warranted. Synovus fully reserves for any loans rated as Loss.
In the following tables, consumer loans are generally assigned a risk grade similar to the classifications described above; however, upon reaching 90 days and 120 days past due, they are generally downgraded to Substandard and Loss, respectively, in accordance with the FFIEC Uniform Retail Credit Classification and Account Management Policy. Additionally, in accordance with the Interagency Supervisory Guidance, on Allowance for Loan and Lease Losses Estimation Practices for Loans and Lines of Credit Secured by Junior Liens on 1-4 Family Residential Properties, the risk grade classifications of consumer loans (home equity lines(consumer mortgages and consumer mortgages)home equity) secured by junior liens on 1-4 family residential properties also consider available information on the payment status of any associated senior liens with other financial institutions.

The following tables summarize each loan portfolio class by risk grade and origination year as of March 31, 2022 and December 31, 2021 as required under CECL.

12


Loan Portfolio Credit Exposure by Risk Grade 
September 30, 2017 
(in thousands)Pass 
Special
Mention
 
Substandard(1)
 
Doubtful(2)
 Loss Total 
Investment properties$5,847,902
 60,423
 16,771
 —
 —
 5,925,096
 
1-4 family properties756,665
 20,286
 17,438
 227
 —
 794,616
 
Land and development451,141
 36,523
 16,419
 3,129
 —
 507,212
 
Total commercial real estate7,055,708
 117,232
 50,628
 3,356
 —
 7,226,924
 
Commercial, financial and agricultural6,704,805
 106,117
 149,456
 1,250
 81
(3) 
6,961,709
 
Owner-occupied4,632,930
 52,797
 79,633
 73
 —
 4,765,433
 
Total commercial and industrial11,337,735
 158,914
 229,089
 1,323
 81
 11,727,142
 
Home equity lines1,505,724
 —
 20,771
 355
 2,039
(3) 
1,528,889
 
Consumer mortgages2,547,272
 —
 10,125
 177
 106
(3) 
2,557,680
 
Credit cards224,488
 —
 523
 —
 714
(4) 
225,725
 
Other consumer loans1,242,211
 —
 2,754
 299
 14
(3) 
1,245,278
 
Total consumer5,519,695
 —
 34,173
 831
 2,873
 5,557,572
 
Total loans$23,913,138
 276,146
 313,890
 5,510
 2,954
 24,511,638
(5 
) 
           March 31, 2022
December 31, 2016 Term Loans Amortized Cost Basis by Origination YearRevolving Loans
(in thousands)Pass 
Special
Mention
 
Substandard(1)
 
Doubtful(2)
 Loss Total (in thousands)20222021202020192018PriorAmortized Cost BasisConverted to Term LoansTotal
Commercial, financial and agriculturalCommercial, financial and agricultural
PassPass$307,165 $2,248,128 $1,274,145 $877,338 $605,200 $1,280,187 $5,672,387 $33,813 $12,298,363 
Special MentionSpecial Mention202 2,235 14,635 9,784 8,486 4,156 87,585 — 127,083 
Substandard(1)
Substandard(1)
2,867 11,969 47,998 46,234 11,331 45,537 63,546 362 229,844 
Doubtful(2)
Doubtful(2)
— 464 — — 3,620 — 48 — 4,132 
Loss(3)
Loss(3)
— — — — — — 189 — 189 
Total commercial, financial and agriculturalTotal commercial, financial and agricultural310,234 2,262,796 1,336,778 933,356 628,637 1,329,880 5,823,755 34,175 12,659,611 
Owner-occupiedOwner-occupied
PassPass400,161 1,752,472 1,199,572 1,044,709 822,093 1,659,184 575,265 — 7,453,456 
Special MentionSpecial Mention138 691 83,388 5,089 19,983 46,836 — — 156,125 
Substandard(1)
Substandard(1)
315 7,269 1,276 8,529 37,274 28,211 — — 82,874 
Loss(3)
Loss(3)
— 259 — — — — — — 259 
Total owner-occupiedTotal owner-occupied400,614 1,760,691 1,284,236 1,058,327 879,350 1,734,231 575,265 — 7,692,714 
Total commercial and industrialTotal commercial and industrial710,848 4,023,487 2,621,014 1,991,683 1,507,987 3,064,111 6,399,020 34,175 20,352,325 
Investment properties$5,794,626
 43,336
 31,299
 —
 —
 5,869,261
 Investment properties
PassPass502,093 2,995,934 1,514,881 1,611,876 997,818 1,872,911 251,150 — 9,746,663 
Special MentionSpecial Mention— 6,545 — 32,606 30,827 87,595 33,558 — 191,131 
Substandard(1)
Substandard(1)
1,252 523 953 5,426 56,611 23,253 21,333 — 109,351 
Total investment propertiesTotal investment properties503,345 3,003,002 1,515,834 1,649,908 1,085,256 1,983,759 306,041 — 10,047,145 
1-4 family properties826,311
 33,928
 26,790
 278
 —
 887,307
 1-4 family properties
PassPass73,676 245,278 70,143 43,125 38,539 91,502 47,599 — 609,862 
Special MentionSpecial Mention243 190 537 638 — 235 — — 1,843 
Substandard(1)
Substandard(1)
1,750 2,297 6 564 2,004 2,303 45 — 8,969 
Total 1-4 family propertiesTotal 1-4 family properties75,669 247,765 70,686 44,327 40,543 94,040 47,644 — 620,674 
Land and development521,745
 60,205
 27,361
 6,987
 —
 616,298
 Land and development
PassPass24,697 138,267 37,147 69,216 23,133 97,030 45,900 — 435,390 
Special MentionSpecial Mention— — 790 — 31,160 1,160 — — 33,110 
Substandard(1)
Substandard(1)
186 392 323 651 2,985 4,462 — — 8,999 
Total land and developmentTotal land and development24,883 138,659 38,260 69,867 57,278 102,652 45,900 — 477,499 
Total commercial real estate7,142,682
 137,469
 85,450
 7,265
 —

7,372,866
 Total commercial real estate603,897 3,389,426 1,624,780 1,764,102 1,183,077 2,180,451 399,585 — 11,145,318 
Commercial, financial and agricultural6,635,756
 126,268
 140,425
 6,445
 141
(3) 
6,909,035
 
Owner-occupied4,462,420
 60,856
 111,330
 1,410
 —

4,636,016
 
Total commercial and industrial11,098,176
 187,124
 251,755
 7,855
 141

11,545,051
 
Home equity lines1,589,199
 —
 22,774
 2,892
 2,400
(3) 
1,617,265
 
Consumer mortgages2,271,916
 —
 23,268
 1,283
 137
(3) 
2,296,604
 
Credit cards230,997
 —
 637
 —
 779
(4) 
232,413
 
Other consumer loans814,844
 —
 3,233
 42
 64
(3) 
818,183
 
Total consumer4,906,956
 —
 49,912
 4,217
 3,380
 4,964,465
 
Total loans$23,147,814
 324,593
 387,117
 19,337
 3,521
 23,882,382
(6 
) 
           

13


March 31, 2022
Term Loans Amortized Cost Basis by Origination YearRevolving Loans
(in thousands)20222021202020192018PriorAmortized Cost BasisConverted to Term LoansTotal
Consumer mortgages
Pass227,036 1,265,235 1,494,751 519,494 195,449 1,293,538 306 — 4,995,809 
Substandard(1)
21 2,362 5,114 6,846 11,307 29,778 — — 55,428 
Loss(3)
— — — 4 — 762 — — 766 
Total consumer mortgages227,057 1,267,597 1,499,865 526,344 206,756 1,324,078 306 — 5,052,003 
Home equity
Pass— — — — — — 1,192,522 210,986 1,403,508 
Substandard(1)
— — — — — — 6,780 5,488 12,268 
Doubtful(2)
— — — — — — — — — 
Loss(3)
— — — — — — 426 139 565 
Total home equity— — — — — — 1,199,728 216,613 1,416,341 
Credit cards
Pass— — — — — — 187,035 — 187,035 
Substandard(1)
— — — — — — 451 — 451 
Loss(4)
— — — — — — 761 — 761 
Total credit cards— — — — — — 188,247 — 188,247 
Other consumer loans
Pass30,863 705,823 627,569 104,053 46,362 189,427 303,456 — 2,007,553 
Substandard(1)
114 793 1,510 1,989 1,196 1,559 184 — 7,345 
Loss(4)
— — — — — 18 — — 18 
Total other consumer loans30,977 706,616 629,079 106,042 47,558 191,004 303,640 — 2,014,916 
Total consumer258,034 1,974,213 2,128,944 632,386 254,314 1,515,082 1,691,921 216,613 8,671,507 
Loans, net of deferred fees and costs$1,572,779 $9,387,126 $6,374,738 $4,388,171 $2,945,378 $6,759,644 $8,490,526 $250,788 $40,169,150 
(1) Includes $224.5 million and $256.6 millionThe majority of loans within Substandard risk grade are accruing loans at September 30, 2017 and DecemberMarch 31, 2016, respectively.2022.
(2) The loansLoans within thisDoubtful risk grade are on non-accrual status. Commercial loansstatus and generally have an allowance for loan losses in accordance with ASC 310, and retail loans generally have an allowance for loan lossesALL equal to 50% of the loan amount.
(3) The loansLoans within thisLoss risk grade are on non-accrual status and have an allowance for loan lossesALL equal to the full loan amount.
(4)    Represent amounts that were 120 days past due. These credits are downgraded to the Loss category with an allowance for loan lossesALL equal to the full loan amount and are generally charged off upon reaching 181 days past due in accordance with the FFIEC Uniform Retail Credit Classification Policy.


14


December 31, 2021
Term Loans Amortized Cost Basis by Origination YearRevolving Loans
(in thousands)20212020201920182017PriorAmortized Cost BasisConverted to Term LoansTotal
Commercial, financial and agricultural
Pass$2,396,717 $1,332,549 $922,396 $607,918 $433,045 $903,995 $5,151,981 $42,809 $11,791,410 
Special Mention2,731 15,166 17,571 10,433 2,242 2,489 71,996 — 122,628 
Substandard(1)
16,105 50,979 40,125 10,383 16,473 37,565 51,442 33 223,105 
Doubtful(2)
469 — 1,601 8,512 — — 48 — 10,630 
Loss(3)
— — — — — — 85 — 85 
Total commercial, financial and agricultural2,416,022 1,398,694 981,693 637,246 451,760 944,049 5,275,552 42,842 12,147,858 
Owner-occupied
Pass1,776,086 1,276,797 1,117,825 858,721 708,942 1,116,766 437,724 — 7,292,861 
Special Mention702 19,950 4,724 10,202 18,109 36,481 — — 90,168 
Substandard(1)
7,312 1,294 8,386 43,276 6,169 25,329 — — 91,766 
Loss(3)
271 — — — — — — — 271 
Total owner-occupied1,784,371 1,298,041 1,130,935 912,199 733,220 1,178,576 437,724 — 7,475,066 
Total commercial and industrial4,200,393 2,696,735 2,112,628 1,549,445 1,184,980 2,122,625 5,713,276 42,842 19,622,924 
Investment properties
Pass2,823,978 1,463,503 1,905,534 1,019,765 738,036 1,317,634 278,697 — 9,547,147 
Special Mention6,163 — 32,290 63,900 59,194 44,532 33,659 — 239,738 
Substandard(1)
1,465 326 8,550 57,127 3,564 23,505 21,354 — 115,891 
Total investment properties2,831,606 1,463,829 1,946,374 1,140,792 800,794 1,385,671 333,710 — 9,902,776 
1-4 family properties
Pass295,082 82,976 51,939 43,025 49,057 57,025 55,588 — 634,692 
Special Mention192 207 641 — — 239 — — 1,279 
Substandard(1)
1,999 — 566 4,222 489 2,177 45 — 9,498 
Total 1-4 family properties297,273 83,183 53,146 47,247 49,546 59,441 55,633 — 645,469 
Land and development
Pass141,614 42,201 77,868 34,058 37,167 44,989 44,730 — 422,627 
Special Mention— 800 1,900 31,458 — 1,179 — — 35,337 
Substandard(1)
824 1,149 46 3,021 807 3,055 — — 8,902 
Total land and development142,438 44,150 79,814 68,537 37,974 49,223 44,730 — 466,866 
Total commercial real estate3,271,317 1,591,162 2,079,334 1,256,576 888,314 1,494,335 434,073 — 11,015,111 

15


December 31, 2021
Term Loans Amortized Cost Basis by Origination YearRevolving Loans
(in thousands)20212020201920182017PriorAmortized Cost BasisConverted to Term LoansTotal
Consumer mortgages
Pass1,274,999 1,556,733 572,467 216,277 392,492 1,001,771 255 — 5,014,994 
Substandard(1)
1,031 3,680 5,943 12,387 5,717 25,025 — — 53,783 
Loss(3)
— — 5 — — 216 — — 221 
Total consumer mortgages1,276,030 1,560,413 578,415 228,664 398,209 1,027,012 255 — 5,068,998 
Home equity
Pass— — — — — — 1,199,556 146,635 1,346,191 
Substandard(1)
— — — — — — 9,058 5,372 14,430 
Loss(3)
— — — — — — 658 140 798 
Total home equity— — — — — — 1,209,272 152,147 1,361,419 
Credit cards
Pass— — — — — — 203,161 — 203,161 
Substandard(1)
— — — — — — 348 — 348 
Loss(4)
— — — — — — 663 — 663 
Total credit cards— — — — — — 204,172 — 204,172 
Other consumer loans
Pass654,419 708,937 127,131 49,993 86,175 97,765 306,500 — 2,030,920 
Substandard(1)
668 1,550 2,064 1,308 1,892 750 162 — 8,394 
Loss(4)
— — — — — 20 — — 20 
Total other consumer loans655,087 710,487 129,195 51,301 88,067 98,535 306,662 — 2,039,334 
Total consumer1,931,117 2,270,900 707,610 279,965 486,276 1,125,547 1,720,361 152,147 8,673,923 
Loans, net of deferred fees and costs$9,402,827 $6,558,797 $4,899,572 $3,085,986 $2,559,570 $4,742,507 $7,867,710 $194,989 $39,311,958 
(1)    The majority of loans within Substandard risk grade are accruing loans at December 31, 2021.
(2)    Loans within Doubtful risk grade are on non-accrual status and Account Managementgenerally have an ALL equal to 50% of the loan amount.
(3)    Loans within Loss risk grade are on non-accrual status and have an ALL equal to the full loan amount.
(4)    Represent amounts that were 120 days past due. These credits are downgraded to the Loss category with an ALL equal to the full loan amount and are generally charged off upon reaching 181 days past due in accordance with the FFIEC Retail Credit Classification Policy.
(5) Total before net deferred feesCollateral-Dependent Loans
We classify a loan as collateral-dependent when our borrower is experiencing financial difficulty, and costswe expect repayment to be provided substantially through the operation or sale of $24.3 million.collateral. Our commercial loans have collateral that is comprised of real estate and business assets. Our consumer loans have collateral that is substantially comprised of residential real estate.
(6) Total before net deferred fees and costsThere were no significant changes in the extent to which collateral secures our collateral-dependent loans during the three months ended March 31, 2022.

16


Rollforward of $26.0 million.

Allowance for Loan Losses
The following table detailstables detail the changes in the allowance for loan lossesALL by loan segment for the nine and three months ended September 30, 2017.March 31, 2022 and 2021.
As Of and For the Three Months Ended March 31, 2022
(in thousands)Commercial & IndustrialCommercial Real EstateConsumerTotal
Allowance for loan losses:
Beginning balance at December 31, 2021$188,364 $97,760 $141,473 $427,597 
Charge-offs(13,763)(2,456)(8,928)(25,147)
Recoveries2,363 361 3,814 6,538 
Provision for (reversal of) loan losses1,758 (969)5,179 5,968 
Ending balance at March 31, 2022$178,722 $94,696 $141,538 $414,956 
As Of and For the Three Months Ended March 31, 2021
(in thousands)Commercial & IndustrialCommercial Real EstateConsumerTotal
Allowance for loan losses:
Beginning balance at December 31, 2020$229,555 $130,742 $245,439 $605,736 
Charge-offs(9,417)(10,319)(5,589)(25,325)
Recoveries2,772 1,026 1,323 5,121 
Provision for (reversal of) loan losses31,867 (7,637)(46,548)(22,318)
Ending balance at March 31, 2021$254,777 $113,812 $194,625 $563,214 
Allowance for Loan Losses and Recorded Investment in Loans

 As Of and For The Nine Months Ended September 30, 2017
(in thousands)Commercial Real Estate Commercial & Industrial Retail Total
Allowance for loan losses:       
Beginning balance$81,816
 125,778
 44,164
 251,758
Charge-offs(11,336) (41,390) (24,023) (76,749)
Recoveries6,191
 5,181
 4,682
 16,054
Provision for loan losses1,289
 36,934
 20,397
 58,620
Ending balance(1)
$77,960
 126,503
 45,220
 249,683
Ending balance: individually evaluated for impairment4,108
 7,360
 783
 12,251
Ending balance: collectively evaluated for impairment$73,852
 119,143
 44,437
 237,432
Loans:       
Ending balance: total loans(1)(2)
$7,226,924
 11,727,142
 5,557,572
 24,511,638
Ending balance: individually evaluated for impairment    64,909
 109,434
 30,132
 204,475
Ending balance: collectively evaluated for impairment$7,162,015
 11,617,708
 5,527,440
 24,307,163
        
 As Of and For The Nine Months Ended September 30, 2016
(in thousands)Commercial Real Estate Commercial & Industrial Retail Total
Allowance for loan losses:       
Beginning balance$87,133
 122,989
 42,374
 252,496
Charge-offs(13,361) (17,098) (10,611) (41,070)
Recoveries10,927
 6,122
 3,601
 20,650
Provision for loan losses(3,597) 18,875
 6,463
 21,741
Ending balance(1)
$81,102
 130,888
 41,827
 253,817
Ending balance: individually evaluated for impairment11,066
 11,474
 1,724
 24,264
Ending balance: collectively evaluated for impairment$70,036
 119,414
 40,103
 229,553
Loans:       
Ending balance: total loans(1)(3)
$7,472,551 11,009,021
 4,807,511
 23,289,083
Ending balance: individually evaluated for impairment102,837
 118,442
 37,820
 259,099
Ending balance: collectively evaluated for impairment$7,369,714
 10,890,579
 4,769,691
 23,029,984
        
The ALL of $415.0 million and the reserve for unfunded commitments of $47.3 million, which is recorded in other liabilities, comprise the total ACL of $462.3 million at March 31, 2022. The ACL decreased $7.2 million compared to the December 31, 2021 ACL of $469.5 million, which consisted of an ALL of $427.6 million and the reserve for unfunded commitments of $41.9 million. The ACL to loans coverage ratio of 1.15% at March 31, 2022 was 4 bps lower compared to December 31, 2021.
(1) AsThe reduction in the ACL resulted primarily from continued positive trends in our credit performance and loan mix mostly offset by an increase in the downside weighting of the multiple scenario model which reflects increased economic uncertainty from inflation concerns and geopolitical tensions and slowed the pace of the allowance decline this quarter.
The ACL is estimated using a two-year reasonable and supportable forecast period. To the extent the lives of the loans in the portfolio extend beyond the period for which a reasonable and supportable forecast can be made, the nine months ended September 30, 2017Company reverts on a straight-line basis back to the historical rates over a one-year period. Synovus utilizes multiple economic forecast scenarios sourced from a reputable third-party provider and 2016, there were no purchased credit-impaired loansprobability-weighted internally. The scenarios include a baseline forecast, an upside scenario reflecting an accelerated recovery, a downside scenario that reflects adverse economic conditions, and no allowancean additional adverse scenario that assumes consistent slow growth that is less optimistic than the baseline. At March 31, 2022, economic scenario weights incorporated a 64% downside bias to the baseline scenario compared to 43% at December 31, 2021. The baseline outlook used in the March 31, 2022 estimate showed stable economic conditions with the unemployment rate improving to 3.4% by the end of 2022, compared to 3.7% used in the December 31, 2021 ACL estimate. The downside scenario that assumes consistent slow growth is the highest internally-weighted economic scenario and includes an unemployment rate of 4.7% by the end of 2022.
The provision for loancredit losses for purchased credit-impaired loans.
(2) Total before net deferred fees and costs of $24.3 million.
(3) Total before net deferred fees and costs of $26.2 million.





Allowance for Loan Losses and Recorded Investment in Loans

 As Of and For The Three Months Ended September 30, 2017
(in thousands)Commercial Real Estate Commercial & Industrial Consumer Total
Allowance for loan losses:       
Beginning balance$77,527
 123,437
 47,131
 248,095
Charge-offs(8,129) (21,855) (14,367) (44,351)
Recoveries2,543
 1,899
 1,811
 6,253
Provision for loan losses6,019
 23,022
 10,645
 39,686
Ending balance(1)
$77,960
 126,503
 45,220
 249,683
Ending balance: individually evaluated for impairment4,108
 7,360
 783
 12,251
Ending balance: collectively evaluated for impairment$73,852
 119,143
 44,437
 237,432
Loans:       
Ending balance: total loans(1)(2)
$7,226,924
 11,727,142
 5,557,572
 24,511,638
Ending balance: individually evaluated for impairment    64,909
 109,434
 30,132
 204,475
Ending balance: collectively evaluated for impairment$7,162,015
 11,617,708
 5,527,440
 24,307,163
        
 As Of and For The Three Months Ended September 30, 2016
(in thousands)Commercial Real Estate Commercial & Industrial Consumer Total
Allowance for loan losses:       
Beginning balance$79,359
 129,633
 46,084
 255,076
Charge-offs(4,084) (6,437) (3,463) (13,984)
Recoveries4,237
 1,780
 1,037
 7,054
Provision for loan losses1,590
 5,912
 (1,831) 5,671
Ending balance(1)
$81,102
 130,888
 41,827
 253,817
Ending balance: individually evaluated for impairment11,066
 11,474
 1,724
 24,264
Ending balance: collectively evaluated for impairment$70,036
 119,414
 40,103
 229,553
Loans:       
Ending balance: total loans(1)(3)
$7,472,551
 11,009,021
 4,807,511
 23,289,083
Ending balance: individually evaluated for impairment102,837
 118,442
 37,820
 259,099
Ending balance: collectively evaluated for impairment$7,369,714
 10,890,579
 4,769,691
 23,029,984
        
(1)As of and$11.4 million for the three months ended September 30, 2017 and 2016, there were no purchased credit-impaired loans and no allowance for loan losses for purchased credit-impaired loans.
(2) Total beforeMarch 31, 2022 included net deferred fees and costscharge-offs of $24.3 million.
(3) Total before net deferred fees and costs of $26.2 million.




The tables below summarize impaired loans (including accruing TDRs) as of September 30, 2017 and December 31, 2016.
Impaired Loans (including accruing TDRs)
 September 30, 2017 Nine Months Ended September 30, 2017 Three Months Ended September 30, 2017
(in thousands)Recorded Investment Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized Average Recorded Investment Interest Income Recognized
With no related allowance recorded             
Investment properties$—
 —
 —
 164
 —
 —
 —
1-4 family properties253
 2,582
 —
 374
 —
 253
 —
Land and development1,488
 3,172
 —
 2,084
 —
 1,911
 —
Total commercial real estate1,741
 5,754
 —
 2,622
 —
 2,164
 —
Commercial, financial and agricultural
20,696
 22,122
 —
 23,094
 —
 25,583
 —
Owner-occupied97
 744
 —
 8,875
 —
 7,164
 —
Total commercial and industrial20,793
 22,866
 —
 31,969
 —
 32,747
 —
Home equity lines1,072
 1,072
 —
 1,063
 —
 1,069
 —
Consumer mortgages—
 —
 —
 661
 —
 496
 —
Credit cards—
 —
 —
 —
 —
 —
 —
Other consumer loans—
 —
 —
 —
 —
 —
 —
Total consumer1,072
 1,072
 —
 1,724
 —
 1,565
 —
Total impaired loans with no
related allowance recorded
$23,606
 29,692
 —
 36,315
 —
 36,476

—
With allowance recorded             
Investment properties$28,651
 28,651
 1,116
 29,325
 903
 28,826
 306
1-4 family properties15,741
 15,741
 452
 16,552
 664
 15,665
 278
Land and development18,776
 18,832
 2,540
 24,825
 347
 18,544
 48
Total commercial real estate63,168
 63,224
 4,108
 70,702
 1,914
 63,035
 632
Commercial, financial and agricultural
51,819
 52,019
 5,730
 48,694
 1,175
 53,040
 388
Owner-occupied36,822
 36,855
 1,630
 41,627
 1,002
 37,004
 328
Total commercial and industrial88,641
 88,874
 7,360
 90,321
 2,177
 90,044
 716
Home equity lines5,995
 5,995
 119
 7,807
 265
 6,534
 82
Consumer mortgages18,336
 18,336
 382
 19,270
 687
 18,369
 222
Credit cards—
 —
 —
 —
 —
 —
 —
Other consumer loans4,729
 4,729
 282
 4,507
 191
 4,224
 59
Total consumer29,060
 29,060

783
 31,584
 1,143
 29,127
 363
Total impaired loans with
allowance recorded
$180,869
 181,158
 12,251
 192,607
 5,234
 182,206
 1,711
Total impaired loans             
Investment properties$28,651
 28,651

1,116
 29,489
 903

28,826
 306
1-4 family properties15,994
 18,323

452
 16,926
 664

15,918
 278
Land and development20,264
 22,004

2,540
 26,909
 347

20,455
 48
Total commercial real estate64,909
 68,978

4,108
 73,324
 1,914

65,199
 632
Commercial, financial and agricultural
72,515
 74,141

5,730
 71,788
 1,175

78,623
 388
Owner-occupied36,919
 37,599

1,630
 50,502
 1,002

44,168
 328
Total commercial and industrial109,434
 111,740

7,360
 122,290
 2,177

122,791
 716
Home equity lines7,067
 7,067

119
 8,870
 265

7,603
 82
Consumer mortgages18,336
 18,336

382
 19,931
 687

18,865
 222
Credit cards—
 —

—
 —
 —

—
 —
Other consumer loans4,729
 4,729

282
 4,507
 191

4,224
 59
Total consumer30,132
 30,132

783
 33,308
 1,143

30,692
 363
Total impaired loans$204,475
 210,850

12,251
 228,922
 5,234

218,682
 1,711
              

Impaired Loans (including accruing TDRs)
 December 31, 2016 Year Ended December 31, 2016
(in thousands)Recorded Investment Unpaid Principal Balance Related Allowance Average Recorded Investment Interest Income Recognized
With no related allowance recorded         
Investment properties$748
 793
 —
 2,013
 —
1-4 family properties643
 2,939
 —
 1,021
 —
Land and development2,099
 7,243
 —
 6,769
 —
Total commercial real estate3,490
 10,975
 —
 9,803
 —
Commercial, financial and agricultural17,958
 20,577
 —
 6,321
 —
Owner-occupied5,508
 7,377
 —
 8,394
 —
Total commercial and industrial23,466
 27,954
 —
 14,715
 —
Home equity lines1,051
 1,051
 —
 1,045
 —
Consumer mortgages744
 814
 —
 870
 —
Credit cards—
 —
 —
 —
 —
Other consumer loans—
 —
 —
 —
 —
Total consumer1,795
 1,865
 —
 1,915
 —
Total impaired loans with no
related allowance recorded
$28,751
 40,794
 —
 26,433
 —
With allowance recorded         
Investment properties$31,489
 31,489
 2,044
 42,659
 1,436
1-4 family properties23,642
 23,649
 769
 39,864
 855
Land and development32,789
 32,788
 5,103
 25,568
 995
Total commercial real estate87,920
 87,926
 7,916
 108,091
 3,286
Commercial, financial and agricultural43,386
 45,913
 5,687
 51,968
 1,215
Owner-occupied53,708
 53,942
 2,697
 52,300
 1,946
Total commercial and industrial97,094
 99,855
 8,384
 104,268
 3,161
Home equity lines9,638
 9,638
 971
 9,668
 432
Consumer mortgages20,953
 20,953
 673
 20,993
 1,014
Credit cards—
 —
 —
 —
 —
Other consumer loans5,140
 5,140
 167
 5,062
 303
Total consumer35,731
 35,731
 1,811
 35,723
 1,749
Total impaired loans with
allowance recorded
$220,745
 223,512
 18,111
 248,082
 8,196
Total impaired loans         
Investment properties$32,237
 32,282
 2,044
 44,672
 1,436
1-4 family properties24,285
 26,588
 769
 40,885
 855
Land and development34,888
 40,031
 5,103
 32,337
 995
Total commercial real estate91,410
 98,901
 7,916
 117,894
 3,286
Commercial, financial and agricultural61,344
 66,490
 5,687
 58,289
 1,215
Owner-occupied59,216
 61,319
 2,697
 60,694
 1,946
Total commercial and industrial120,560
 127,809
 8,384
 118,983
 3,161
Home equity lines10,689
 10,689
 971
 10,713
 432
Consumer mortgages21,697
 21,767
 673
 21,863
 1,014
Credit cards—
 —
 —
 —
 —
Other consumer loans5,140
 5,140
 167
 5,062
 303
Total consumer37,526
 37,596
 1,811
 37,638
 1,749
Total impaired loans$249,496
 264,306
 18,111
 274,515
 8,196
          

The average recorded investment in impaired loans was $281.2$18.6 million and $263.0also represented a slowing of allowance releases due primarily to the increased economic uncertainty noted above. $3.8 million respectively,in reserves were also added as a result of purchases of $181.3 million of third-party lending loans for the nine and three months ended September 30, 2016. Excluding accruingMarch 31, 2022.


17


TDRs
Information about Synovus' TDRs there was no interest income recognized for the investment in impaired loans for the nine and three months ended September 30, 2016. Interest income recognized for accruing TDRs was $6.1 million and $2.1 million, respectively, for the nine and three months ended September 30, 2016. At September 30, 2017 and December 31, 2016, impaired loans of $37.6 million and $53.7 million, respectively, were on non-accrual status.
Concessions provided in a TDR are primarilyis presented in the formfollowing tables. Synovus began entering into loan modifications with borrowers in response to the COVID-19 pandemic under the CARES Act, some of providing a below market interest rate given the borrower's credit risk, awhich had not been classified as TDRs. The CARES Act election period ended on January 1, 2022. See "Part II - Item 8. Financial Statements and Supplementary Data - Note 1 - Summary of time generally less than one year with a reduction of required principal and/or interest payments (e.g., interest onlySignificant Accounting Policies" in Synovus' 2021 Form 10-K for a period of time), or an extension of the maturity of theinformation on Synovus' loan generally for less than one year. Insignificant periods of reduction of principal and/or interest payments, or one-time deferrals of 3 months or less, are generally not consideredmodifications due to be financial concessions.

COVID-19. The following tables represent, by concession type, the post-modification balance for loans modified or renewed during the nine and three months ended September 30, 2017March 31, 2022 and 20162021 that were reported as accruing or non-accruing TDRs.
TDRs by Concession Type
Three Months Ended March 31, 2022
(in thousands, except contract data)Number of ContractsBelow Market Interest Rate
Other Concessions(1)
Total
Commercial, financial and agricultural33 $17,900 $541 $18,441 
Owner-occupied13 6,104 3,857 9,961 
Total commercial and industrial46 24,004 4,398 28,402 
Investment properties3 589 6,610 7,199 
1-4 family properties7 1,213 — 1,213 
Land and development3 2,731 — 2,731 
Total commercial real estate13 4,533 6,610 11,143 
Consumer mortgages7 1,017 104 1,121 
Home equity11 929 — 929 
Other consumer loans2 — 48 48 
Total consumer20 1,946 152 2,098 
Total TDRs79 $30,483 $11,160 $41,643 (2)
Three Months Ended March 31, 2021
(in thousands, except contract data)Number of ContractsBelow Market Interest Rate
Other Concessions(1)
Total
Commercial, financial and agricultural40 $3,233 $2,563 $5,796 
Owner-occupied5 1,254 399 1,653 
Total commercial and industrial45 4,487 2,962 7,449 
Investment properties5 1,984 — 1,984 
1-4 family properties5 463 39 502 
Land and development1 — 43 43 
Total commercial real estate11 2,447 82 2,529 
Consumer mortgages— — — — 
Home equity13 587 162 749 
Other consumer loans73 129 4,619 4,748 
Total consumer86 716 4,781 5,497 
Total TDRs142 $7,650 $7,825 $15,475 (3)
TDRs by Concession Type  
 Nine Months Ended September 30, 2017 
(in thousands, except contract data)Number of Contracts Principal Forgiveness Below Market Interest Rate Term Extensions and/or Other Concessions Total 
Investment properties—
 $—
 —
 —
 —
 
1-4 family properties21
 —
 2,090
 1,477
 3,567
 
Land acquisition4
 —
 157
 895
 1,052
 
Total commercial real estate25
 —
 2,247
 2,372
 4,619
 
Commercial, financial and agricultural50
 —
 8,703
 12,145
 20,848
 
Owner-occupied4
 —
 35
 1,705
 1,740
 
Total commercial and industrial54
 —
 8,738
 13,850
 22,588
 
Home equity lines—
 —
 —
 —
 —
 
Consumer mortgages8
 —
 248
 1,190
 1,438
 
Credit cards—
 —
 —
 —
 —
 
Other retail loans25
 —
 682
 958
 1,640
 
Total retail33
 —
 930
 2,148
 3,078
 
Total TDRs112
 $—
 11,915
 18,370
 30,285
(1 
) 
           
 Three Months Ended September 30, 2017 
(in thousands, except contract data)Number of Contracts Principal Forgiveness Below Market Interest Rate 
Term Extensions
and/or Other Concessions
 Total 
Investment properties—
 $—
 —
 —
 —
 
1-4 family properties5
 —
 —
 964
 964
 
Land and development3
 —
 157
 760
 917
 
Total commercial real estate8
 —
 157
 1,724
 1,881
 
Commercial, financial and agricultural22
 —
 2,943
 5,866
 8,809
 
Owner-occupied3
 —
 35
 1,683
 1,718
 
Total commercial and industrial25
 —
 2,978
 7,549
 10,527
 
Home equity lines—
 —
 —
 —
 —
 
Consumer mortgages7
 —
 248
 1,181
 1,429
 
Credit cards—
 —
 —
 —
 —
 
Other consumer loans17
 —
 682
 388
 1,070
 
Total consumer24
 —
 930
 1,569
 2,499
 
Total TDRs57
 $—
 4,065
 10,842
 14,907
(1 
) 
           
(1)    Other concessions generally include term extensions, interest only payments for a period of time, or principal forgiveness, but there was 0 principal forgiveness for the three months ending March 31, 2022 and 2021.
(2)    No net charge-offs were recorded during the nine and three months ended September 30, 2017 upon restructuring of these loans.March 31, 2022.




TDRs by Concession Type  
 Nine Months Ended September 30, 2016 
(in thousands, except contract data)Number of Contracts Principal Forgiveness Below Market Interest Rate Term Extensions and/or Other Concessions Total 
Investment properties4
 $—
 1,826
 3,518
 5,344
 
1-4 family properties23
 —
 3,703
 1,211
 4,914
 
Land acquisition13
 —
 —
 1,766
 1,766
 
Total commercial real estate40
 —
 5,529
 6,495
 12,024
 
Commercial, financial and agricultural50
 —
 13,948
 5,232
 19,180
 
Owner-occupied7
 —
 5,458
 550
 6,008
 
Total commercial and industrial57
 —
 19,406
 5,782
 25,188
 
Home equity lines5
 —
 224
 123
 347
 
Consumer mortgages6
 —
 354
 51
 405
 
Credit cards—
 —
 —
 —
 —
 
Other retail loans24
 —
 394
 1,828
 2,222
 
Total retail35
 —
 972
 2,002
 2,974
 
Total TDRs132
 $—
 25,907
 14,279
 40,186
(2 
) 
           
 Three Months Ended September 30, 2016 
(in thousands, except contract data)Number of Contracts Principal Forgiveness Below Market Interest Rate 
Term Extensions
and/or Other Concessions
 Total 
Investment properties1
 $—
 —
 3,370
 3,370
 
1-4 family properties4
 —
 213
 47
 260
 
Land and development2
 —
 —
 497
 497
 
Total commercial real estate7
 —
 213
 3,914
 4,127
 
Commercial, financial and agricultural5
 —
 —
 387
 387
 
Owner-occupied1
 —
 2,791
 —
 2,791
 
Total commercial and industrial6
 —
 2,791
 387
 3,178
 
Home equity lines2
 —
 —
 123
 123
 
Consumer mortgages—
 —
 —
 —
 —
 
Credit cards—
 —
 —
 —
 —
 
Other consumer loans7
 —
 70
 294
 364
 
Total consumer9
 —
 70
 417
 487
 
Total TDRs22
 $—
 3,074
 4,718
 7,792
(2 
) 
           
(2) (3)    No net charge-offs were recorded during the nine and three months ended September 30, 2016 upon restructuring of these loans.March 31, 2021.

For both the nine and three months ended September 30, 2017,March 31, 2022 and March 31, 2021, there were four0 defaults with a recorded investment of $498 thousand and one default with a recorded investment of $206 thousand, respectively, on accruing TDRs restructured during the previous twelve months (defaults are defined as the earlier of the TDR being placed on non-accrual status or reaching 90 days past due with respect to principal and/or interest payments) compared. As of March 31, 2022 and December 31, 2021, there were no commitments to two defaultslend a material amount of additional funds to any client whose loan was classified as a TDR.


18


Note 4 - Goodwill and Other Intangible Assets
During the first quarter of 2022, Synovus reorganized its internal management reporting structure to add an additional segment for Consumer Banking. The Consumer Banking segment was previously included in the Community Banking segment. In connection with the reorganization, management reallocated a recorded investmentportion of $181 thousandthe Community Banking goodwill to Consumer Banking using a relative fair value approach. See "Part I - Item 1. Financial Statements and one default withSupplementary Data - Note 10 - Segment Reporting" in this Report for additional information.
Goodwill allocated to each reporting unit at March 31, 2022 and December 31, 2021 is presented as follows:
(in thousands)Wholesale Banking Reporting UnitCommunity Banking Reporting UnitConsumer Banking Reporting Unit Mortgage Reporting UnitWealth Management Reporting UnitTotal Goodwill
Balance at December 31, 2021$171,636 $256,323 $— $— $24,431 $452,390 
Changes during the period from:
Reallocation— (114,701)114,701 — — — 
Balance at March 31, 2022$171,636 $141,622 $114,701 $— $24,431 $452,390 
Goodwill is evaluated for impairment on an annual basis or whenever an event occurs or circumstances change to indicate that it is more likely than not that an impairment loss has been incurred (i.e., a recorded investmenttriggering event). Synovus performs its annual evaluation of $89 thousand, respectively,goodwill impairment during the fourth quarter of each year. Due to the Company’s reorganization of its reporting structure during the first quarter of 2022, as described above, the Company performed a qualitative impairment assessment of the impacted reporting units and determined that performing a quantitative impairment test was not necessary.
The following table shows the gross carrying amount and accumulated amortization of other intangible assets as of March 31, 2022 and December 31, 2021, which primarily consist of core deposit intangible assets. The CDI is being amortized over its estimated useful life of approximately ten years utilizing an accelerated method. Aggregate other intangible assets amortization expense for the nine and three months ended September 30, 2016.March 31, 2022 and 2021, was $2.1 million and $2.4 million, respectively.
If, at the time a loan was designated as a TDR, the loan was not already impaired, the measurement of impairment that resulted from the TDR designation closely approximates the reserve derived through specific loan measurement of impairment in accordance with ASC 310-10-35. Generally, the change in the allowance for loan losses resulting from such TDR designation is not significant. At September 30, 2017, the allowance for loan losses allocated to accruing TDRs totaling $166.9 million was $8.5 million compared to accruing TDRs of $195.8 million with an allocated allowance for loan losses of $9.8 million at December 31, 2016. Non-accrual, non-homogeneous loans (commercial-type impaired loans greater than $1 million) that are designated as TDRs are individually measured for the amount of impairment, if any, both before
(in thousands)Gross Carrying AmountAccumulated AmortizationNet Carrying Value
March 31, 2022
CDI$57,400 $(30,005)$27,395 
Other12,500 (6,417)6,083 
Total other intangible assets$69,900 $(36,422)$33,478 
December 31, 2021
CDI$57,400 $(28,178)$29,222 
Other12,500 (6,126)6,374 
Total other intangible assets$69,900 $(34,304)$35,596 
Note 5 - Shareholders' Equity and after the TDR designation.

Note 7 - Other Comprehensive Income (Loss)
Repurchases of Common Stock
Synovus announced on January 20, 2022 that its Board of Directors authorized share repurchases of up to $300 million in 2022. During the three months ended March 31, 2022, Synovus repurchased under this program a total of $9.7 million, or 204 thousand shares of its common stock, at an average price of $47.48 per share.
Changes in Accumulated Other Comprehensive Income (Loss) by Component (Net of Income Taxes)
The following tables illustrate activity within the balances in accumulated other comprehensive income (loss) by component for the nine and three months ended September 30, 2017March 31, 2022 and 2016.2021.

19


Changes in Accumulated Other Comprehensive Income (Loss) by Component (Net of Income Taxes)
(in thousands)Net unrealized gains (losses) on cash flow hedges Net unrealized gains (losses) on investment securities available for sale Post-retirement unfunded health benefit Total
Balance at December 31, 2016$(12,217) (44,324) 882
 (55,659)
Other comprehensive income before reclassifications—
 15,812
 38
 15,850
Amounts reclassified from accumulated other comprehensive income (loss)80
 178
 (45) 213
Net current period other comprehensive income80
 15,990
 (7) 16,063
Balance as of September 30, 2017$(12,137) (28,334) 875
 (39,596)
        
Balance as of July 1, 2017$(12,137) (36,586) 858
 (47,865)
Other comprehensive income before reclassifications—
 3,359
 38
 3,397
Amounts reclassified from accumulated other comprehensive income (loss)—
 4,893
 (21) 4,872
Net current period other comprehensive income—
 8,252
 17
 8,269
Balance as of September 30, 2017$(12,137) (28,334) 875
 (39,596)
        
Changes in Accumulated Other Comprehensive Income (Loss) by Component (Net of Income Taxes)
(in thousands)
Net unrealized gains (losses) on investment securities available for sale(1)
Net unrealized gains (losses) on cash flow hedges(1)
Total
Balance at December 31, 2021$(67,980)$(14,341)$(82,321)
Other comprehensive income (loss) before reclassifications(474,459)(103,617)(578,076)
Amounts reclassified from AOCI— (1,668)(1,668)
Net current period other comprehensive income (loss)(474,459)(105,285)(579,744)
Balance at March 31, 2022$(542,439)$(119,626)$(662,065)
Balance at December 31, 2020$105,669 $52,966 $158,635 
Other comprehensive income (loss) before reclassifications(122,460)(21,183)(143,643)
Amounts reclassified from AOCI1,475 (1,189)286 
Net current period other comprehensive income (loss)(120,985)(22,372)(143,357)
Balance at March 31, 2021$(15,316)$30,594 $15,278 
Changes in Accumulated Other Comprehensive Income (Loss) by Component (Net of Income Taxes)
(in thousands)Net unrealized gains (losses) on cash flow hedges Net unrealized gains (losses) on investment securities available for sale Post-retirement unfunded health benefit Total
Balance at December 31, 2015$(12,504) (18,222) 907
 (29,819)
Other comprehensive income before reclassifications—
 34,827
 63
 34,890
Amounts reclassified from accumulated other comprehensive income (loss)247
 (77) (76) 94
Net current period other comprehensive income247
 34,750
 (13) 34,984
Balance as of September 30, 2016$(12,257) 16,528
 894
 5,165
        
Balance as of July 1, 2016$(12,297) 22,459
 843
 11,005
Other comprehensive income (loss) before reclassifications—
 (5,895) 63
 (5,832)
Amounts reclassified from accumulated other comprehensive income (loss)40
 (36) (12) (8)
Net current period other comprehensive income (loss)40
 (5,931) 51
 (5,840)
Balance as of September 30, 2016$(12,257) 16,528
 894
 5,165
        
In accordance with ASC 740-20-45-11(b), a deferred tax asset valuation allowance associated with unrealized gains and losses not recognized in income is charged directly to other comprehensive income (loss). During(1)    For all periods presented, the years 2010 and 2011, Synovus recorded a deferred tax asset valuation allowance associated with unrealized gains and losses not recognized in income directly to other comprehensive income (loss) by applying the portfolio approach for allocation of the valuation allowance. Synovus has consistently applied the portfolio approach which treats derivative financial instruments, equity securities, and debt securities as

a single portfolio. As of September 30, 2017, theending balance in net unrealized gains (losses) on cash flow hedges and net unrealized gains (losses) on investment securities available for sale and cash flow hedges includes unrealized losses of $12.1$13.3 million and $13.3$12.1 million, respectively, related to the residual tax effects remaining in OCI due to a previously established deferred tax asset valuation allowance. Underallowances in 2010 and 2011. In accordance with ASC 740-20-45-11(b), under the portfolio approach, these unrealized losses are realized at the time the entire portfolio is sold or disposed.

20

Reclassifications out of Accumulated Other Comprehensive Income (Loss)
Details About
Accumulated Other Comprehensive Income (Loss) Components
 
Amount Reclassified from
Accumulated Other
Comprehensive Income (Loss)
 
Affected Line Item
in the Statement Where
Net Income is Presented
  For the Nine Months Ended September 30,  
  2017 2016  
Net unrealized gains (losses) on cash flow hedges:      
  Amortization of deferred losses $(130) (205) Interest expense
  Amortization of deferred losses —
 (197) Loss on early extinguishment of debt, net
  50
 155
 Income tax (expense) benefit
  $(80) (247) Reclassifications, net of income taxes
       
Net unrealized (losses) gains on investment securities available for sale:      
  Realized (losses) gains on sale of securities $(289) 126
 Investment securities (losses) gains, net
  111
 (49) Income tax (expense) benefit
  $(178) 77
 Reclassifications, net of income taxes
Post-retirement unfunded health benefit:      
  Amortization of actuarial gains $74
 124
 Salaries and other personnel expense
  (29) (48) Income tax (expense) benefit
  $45
 76
 Reclassifications, net of income taxes
       

Reclassifications out of Accumulated Other Comprehensive Income (Loss)
Details About
Accumulated Other Comprehensive Income (Loss) Components
 
Amount Reclassified from
Accumulated Other
Comprehensive Income (Loss)
Affected Line Item
in the Statement Where
Net Income is Presented
  For the Three Months Ended September 30, 
  2017 2016 
Net unrealized gains (losses) on cash flow hedges:     
  Amortization of deferred losses $—
 (65)Interest expense
  —
 25
Income tax (expense) benefit
  $—
 (40)Reclassifications, net of income taxes
      
Net unrealized gains on investment securities available for sale:     
  Realized net (loss)gain on sale of securities $(7,956) 59
Investment securities (losses) gains, net
  3,063
 (23)Income tax (expense) benefit
  $(4,893) 36
Reclassifications, net of income taxes
Post-retirement unfunded health benefit:     
  Amortization of actuarial gains $34
 20
Salaries and other personnel expense
  (13) (8)Income tax (expense) benefit
  $21
 12
Reclassifications, net of income taxes
      

Note 86 - Fair Value Accounting
Synovus carries various assets and liabilities at fair value based on the fair value accounting guidance under ASC 820, Fair Value Measurements, and ASC 825, Financial Instruments. Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an “exit price”) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date.
Fair Value Hierarchy
Synovus determines the fair value of its financial instruments based on the fair value hierarchy established under ASC 820-10, which requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the financial instrument's fair value measurement in its entirety. There are three levels of inputs that may be used to measure fair value. The three levels of inputs of the valuation hierarchy are defined below:
Level 1Quoted prices (unadjusted) in active markets for identical assets and liabilities for the instrument or security to be valued. Level 1 assets include marketable equity securities, U.S. Treasury securities, and mutual funds.
Level 2Observable inputs other than Level 1 quoted prices, such as quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active or model-based valuation techniques for which all significant assumptions are derived principally from or corroborated by observable market data. Level 2 assets and liabilities include debt securities with quoted prices that are traded less frequently than exchange-traded instruments and derivative contracts whose value is determined by using a pricing model with inputs that are observable in the market or can be derived principally from or corroborated by observable market data. U.S. Government sponsored agency securities, mortgage-backed securities issued by U.S. Government sponsored enterprises and agencies, obligations of states and municipalities, collateralized mortgage obligations issued by U.S. Government sponsored enterprises, and mortgage loans held-for-sale are generally included in this category.
Level 3Unobservable inputs that are supported by little, if any, market activity for the asset or liability. Level 3 assets and liabilities include financial instruments whose value is determined using pricing models, discounted cash flow models and similar techniques, and may also include the use of market prices of assets or liabilities that are not directly comparable to the subject asset or liability. These methods of valuation may result in a significant portion of the fair value being derived from unobservable assumptions that reflect Synovus' own estimates for assumptions that market participants would use in pricing the asset or liability. This category primarily includes collateral-dependent impaired loans, other real estate, certain equity investments, private equity investments, GGL/SBA loan servicing assets, and contingent consideration.

See "Part II - Item 8. Financial Statements and Supplementary Data - Note 161 - Fair Value Accounting" to the consolidated financial statementsSummary of Significant Accounting Policies" of Synovus' 20162021 Form 10-K for a description of valuation methodologies for assets and liabilities measured at fair value on a recurring and non-recurring basis.

















Assets and Liabilities Measured at Fair Value on a Recurring Basis
The following table presents all financial instrumentsassets and liabilities measured at estimated fair value on a recurring basis as of September 30, 2017 and December 31, 2016, according to the valuation hierarchy included in ASC 820-10. For equity and debt securities, class was determined based on the nature and risks of the investments. Synovus did not have any transfers between levels during the nine and three months ended September 30, 2017 and year ended December 31, 2016.basis.
March 31, 2022December 31, 2021
(in thousands)Level 1Level 2Level 3Total Estimated Fair ValueLevel 1Level 2Level 3Total Estimated Fair Value
Assets
Trading securities:
Mortgage-backed securities issued by U.S. Government agencies$— $— $— $— $— $197 $— $197 
Collateralized mortgage obligations issued by U.S. Government sponsored enterprises— 483 — 483 — 671 — 671 
Other mortgage-backed securities— 3,362 — 3,362 — — — — 
State and municipal securities— 414 — 414 — 560 — 560 
Asset-backed securities— 5,359 — 5,359 — 6,963 — 6,963 
Total trading securities$— $9,618 $— $9,618 $— $8,391 $— $8,391 
Investment securities available for sale:
U.S. Treasury securities$394,586 $— $— $394,586 $117,838 $— $— $117,838 
U.S. Government agency securities— 51,805 — 51,805 — 54,201 — 54,201 
Mortgage-backed securities issued by U.S. Government agencies— 686,744 — 686,744 — 779,633 — 779,633 
Mortgage-backed securities issued by U.S. Government sponsored enterprises— 7,620,631 — 7,620,631 — 8,012,301 — 8,012,301 
Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises— 822,878 — 822,878 — 939,623 — 939,623 
Commercial mortgage-backed securities issued by U.S. Government agencies or sponsored enterprises— 530,796 — 530,796 — 481,744 — 481,744 
Asset-backed securities— 337,037 — 337,037 — 514,188 — 514,188 
Corporate debt securities and other debt securities— 18,624 — 18,624 — 18,801 — 18,801 
Total investment securities available for sale$394,586 $10,068,515 $— $10,463,101 $117,838 $10,800,491 $— $10,918,329 
Mortgage loans held for sale$— $111,992 $— $111,992 $— $108,198 $— $108,198 
Other investments— — 12,093 12,093 — — 12,185 12,185 
Mutual funds and mutual funds held in rabbi trusts43,842 — — 43,842 43,657 — — 43,657 
GGL/SBA loans servicing asset— — 3,451 3,451 — — 3,233 3,233 
Derivative assets— 160,545 — 160,545 — 191,708 — 191,708 
Liabilities
Trading liability for short positions$— $389 $— $389 $— $200 $— $200 
Mutual funds held in rabbi trusts28,095 — — 28,095 27,205 — — 27,205 
Derivative liabilities— 230,087 1,776 231,863 — 95,067 3,535 98,602 




21


 September 30, 2017
(in thousands)Level 1 Level 2 Level 3 Total Assets and Liabilities at Fair Value
Assets       
Trading securities:       
Mortgage-backed securities issued by U.S. Government sponsored enterprises—
 494
 —
 494
  Collateralized mortgage obligations issued by
  U.S. Government sponsored enterprises    
—
 10,484
 —
 10,484
  State and municipal securities—
 1,101
 —
 1,101
  Other investments—
 250
 —
 250
Total trading securities$—
 12,329
 —
 12,329
Mortgage loans held for sale—
 54,072
 —
 54,072
        
Investment securities available for sale:       
U.S. Treasury securities83,181
 —
 —
 83,181
U.S. Government agency securities—
 11,038
 —
 11,038
Mortgage-backed securities issued by U.S. Government agencies—
 127,384
 —
 127,384
Mortgage-backed securities issued by U.S. Government sponsored enterprises—
 2,651,852
 —
 2,651,852
Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises—
 931,440
 —
 931,440
State and municipal securities—
 181
 —
 181
 Corporate debt and other securities(1)    
3,162
 15,287
 1,918
 20,367
Total investment securities available for sale$86,343
 3,737,182
 1,918
 3,825,443
Private equity investments—
 —
 15,671
 15,671
Mutual funds held in rabbi trusts13,439
 —
 —
 13,439
GGL/SBA loans servicing asset—
 —
 4,270
 4,270
Derivative assets:       
Interest rate contracts—
 14,896
 —
 14,896
Mortgage derivatives(2)
—
 974
 —
 974
Total derivative assets$—
 15,870
 —
 15,870
Liabilities       
Trading account liabilities—
 7,860
 —
 7,860
Earnout liability(3)
—
 —
 16,000
 16,000
Derivative liabilities:       
Interest rate contracts—
 12,369
 —
 12,369
Mortgage derivatives(2)
—
 32
 —
 32
Visa derivative—
 —
 4,693
 4,693
Total derivative liabilities$—
 12,401
 4,693
 17,094
        
Fair Value Option

 December 31, 2016
(in thousands)Level 1 Level 2 Level 3 Total Assets and Liabilities at Fair Value
Assets       
Trading securities:       
Mortgage-backed securities issued by U.S. Government agencies—
 3,460
 —
 3,460
Collateralized mortgage obligations issued by U.S. Government sponsored enterprises—
 3,438
 —
 3,438
State and municipal securities—
 426
 —
 426
Other investments1,890
 100
 —
 1,990
Total trading securities$1,890
 7,424
 —
 9,314
Mortgage loans held for sale—
 51,545
 —
 51,545
        
Investment securities available for sale:       
     U.S. Treasury securities107,802
 —
 —
 107,802
U.S. Government agency securities—
 12,993
 —
 12,993
Mortgage-backed securities issued by U.S. Government agencies—
 174,202
 —
 174,202
Mortgage-backed securities issued by U.S. Government sponsored enterprises—
 2,506,340
 —
 2,506,340
Collateralized mortgage obligations issued by U.S. Government agencies or sponsored enterprises—
 890,442
 —
 890,442
State and municipal securities—
 2,794
 —
 2,794
Equity securities3,782
 —
 —
 3,782
 Corporate debt and other securities(1)    
3,092
 14,952
 1,796
 19,840
Total investment securities available for sale$114,676
 3,601,723
 1,796
 3,718,195
Private equity investments—
 —
 25,493
 25,493
Mutual funds held in rabbi trusts11,479
 —
 —
 11,479
Derivative assets:       
Interest rate contracts—
 17,157
 —
 17,157
Mortgage derivatives(2)
—
 3,466
 —
 3,466
Total derivative assets$—
 20,623
 —
 20,623
Liabilities       
Earnout liability(3) 
—
 —
 14,000
 14,000
Derivative liabilities:       
Interest rate contracts—
 17,531
 —
 17,531
Visa derivative—
 —
 5,768
 5,768
Total derivative liabilities$—
 17,531
 5,768
 23,299
        
(1) Based on an analysis of the nature and risks of these investments, Synovus has determined that presenting these investments as a single asset class is appropriate.
(2) Mortgage derivatives consist of customer interest rate lock commitments that relate toelected the potential origination offair value option for mortgage loans which would be classified as held for sale primarily to ease the operational burden required to maintain hedge accounting for these loans. Synovus is still able to achieve effective economic hedges on mortgage loans held for sale without the time and forward loan sales commitments with third-party investors.
(3) Earnout liability consists of contingent consideration obligation relatedexpense needed to the Global One acquisition.

Fair Value Optionmanage a hedge accounting program.
The following table summarizes the difference between the fair value and the unpaid principal balanceUPB of mortgage loans held for sale measured at fair value and the changes in fair value of these loans. Mortgage loans held for sale are initially measured at fair value with subsequent changes in fair value recognized in earnings. Changes in fair value are recorded as a component of mortgage banking income in the Consolidated Statements of Income. An immaterial portion of these changes in fair value was attributable to changes in instrument-specific credit risk.
Mortgage Loans Held for Sale
(in thousands)As of March 31, 2022As of December 31, 2021
Fair value$111,992 $108,198 
Unpaid principal balance111,929 105,785 
Fair value less aggregate unpaid principal balance$63 $2,413 
Changes in Fair Value Included in Net Income       Changes in Fair Value Included in Net IncomeThree Months Ended March 31,Location in Consolidated Statements of Income
For the Nine Months Ended September 30, For the Three Months Ended September 30,
(in thousands)2017 2016 2017 2016(in thousands)20222021Location in Consolidated Statements of Income
Mortgage loans held for sale$850
 1,762
 $(104) (87)Mortgage loans held for sale$(2,350)$(4,632)
       

Mortgage Loans Held for Sale 
(in thousands)As of September 30, 2017 As of December 31, 2016
Fair value$54,072
 51,545
Unpaid principal balance52,791
 51,114
Fair value less aggregate unpaid principal balance$1,281
 431
    

Changes inActivity for Level 3 Assets and Liabilities
See "Part II - Item 8. Financial Statements and Supplementary Data - Note 12 - Fair Value MeasurementsAccounting" of Synovus' 2021 Form 10-K for a description of the valuation techniques and Quantitative Information aboutsignificant inputs for Level 3 Fair Value Measurements
As noted above, Synovus uses significant unobservable inputs in determining the fair value of assets and liabilities classified as Level 3 in the fair value hierarchy. The table below includes a roll-forward of the amounts on the Consolidated Balance Sheets for the nine and three months ended September 30, 2017 and 2016 (including the change in fair value), for financial instruments of a material nature that are classified by Synovus within Level 3 of the fair value hierarchy and are measured at fair value on a recurring and non-recurring basis. Transfers between fair value levels are recognized at the end of the reporting period in which the associated changes in inputs occur. During the nine and three months ended September 30, 2017March 31, 2022 and 2016,2021, Synovus did not have any transfers between levelsin or out of Level 3 in the fair value hierarchy.
  
 Nine Months Ended September 30, 2017
(in thousands)Investment Securities Available for Sale Private Equity Investments Visa Derivative 
Earnout
Liability(1) 
 
GGL / SBA
Loans Servicing Asset(2)
Beginning balance, January 1,$1,796
 25,493
 (5,768) (14,000) —
Total (losses) gains realized/unrealized:         
Included in earnings    —
 (3,193) —
 (3,766) (721)
Unrealized gains (losses) included in other comprehensive income122
 —
 —
 —
 —
Additions—
 —
 —
 —
 539
Sales and settlements—
 (6,629) 1,075
 —
 —
Transfer from amortization method to fair value—
 —
 —
 —
 4,452
Measurement period adjustments related to Global One acquisition—
 —
 —
 1,766
 —
Ending balance, September 30,$1,918
 15,671
 (4,693) (16,000) 4,270
Total net (losses) gains for the period included in earnings attributable to the change in unrealized gains (losses) relating to assets/liabilities still held at September 30,$—
 (3,193) —
 (3,766) (721)
          
          
 Three Months Ended September 30, 2017
(in thousands)
Investment Securities Available
for Sale
  Private Equity Investments Visa Derivative 
Earnout
Liability(1) 
 
GGL / SBA
Loans Servicing Asset(2)
Beginning balance, July 1,$1,927
 15,698
 (5,053) (13,941) 4,297
Total (losses) gains realized/unrealized:         
Included in earnings    —
 (27) —
 (2,059) (27)
Unrealized gains (losses) included in other comprehensive income(9) —
 —
 —
 —
Additions—
 —
 —
 —
 —
Sales and settlements—
 —
 360
 —
 —
Measurement period adjustments related to Global One acquisition—
 —
 —
 —
 —
Ending balance, September 30,$1,918
 15,671
 (4,693) (16,000) 4,270
Total net (losses) gains for the period included in earnings attributable to the change in unrealized gains (losses) relating to assets/liabilities still held at September 30,$—
 (27) —
 (2,059) (27)
          
(1) Earnout liability consists The following tables provide rollforwards of contingent consideration obligation related to the Global One acquisition.
(2)Effective January 1, 2017, Synovus elected the fair value option for determining the value of the GGL/SBA loans servicing asset. Synovus has retained servicing responsibilities on sold GGL/SBA loans and receives a servicing fee. The servicing asset is established at fair value at the time of the sale based on an analysis of future cash flows that incorporates estimates for discount rates, prepayment speeds, and delinquency rates. The servicing asset is measured at fair value on a quarterly basis with changes in fair value included with the associated servicing fee in other non-interest income. Prior to 2017, Synovus accounted for the GGL/SBA loans servicing asset using the amortization method.



  
 Nine Months Ended September 30, 2016
(in thousands)Investment Securities Available for Sale Private Equity Investments Visa Derivative
Beginning balance, January 1,$1,745
 27,148
 (1,415)
Total (losses) gains realized/unrealized:     
Included in earnings    —
 (527) (1,080)
Unrealized gains (losses) included in other comprehensive income28
 —
 —
Settlements—
 (629) 1,080
Ending balance, September 30,$1,773
 25,992
 (1,415)
Total net (losses) gains for the period included in earnings attributable to the change in unrealized gains (losses) relating to assets still held at September 30,$—
 (527) (1,080)
      
      
 Three Months Ended September 30, 2016
(in thousands)
Investment Securities Available
for Sale
  Private Equity Investments Visa Derivative
Beginning balance, July 1,$1,625
 26,866
 (1,415)
Total (losses) gains realized/unrealized:     
Included in earnings    —
 (249) (360)
Unrealized gains (losses) included in other comprehensive income148
 —
 —
Settlements—
 (625) 360
Ending balance, September 30,$1,773
 25,992
 (1,415)
Total net (losses) gains for the period included in earnings attributable to the change in unrealized gains (losses) relating to assets still held at September 30,$—
 (249) (360)
      



The table below provides an overview of the valuation techniques and significant unobservable inputs used in those techniques to measure financial instruments that are classified within Level 3 of the valuation hierarchyassets and areliabilities measured at fair value on a recurring basis.
Three Months Ended March 31, 2022
(in thousands)Other InvestmentsGGL / SBA
Loans Servicing Asset		Visa Derivative
Beginning balance$12,185 $3,233 $(3,535)
Total gains (losses) realized/unrealized:
Included in earnings(92)(262)— 
Additions— — — 
Settlements— 480 1,759 
Ending balance$12,093 $3,451 $(1,776)
Total net gains (losses) for the period included in earnings attributable to the change in unrealized gains/(losses) relating to assets/liabilities still held at March 31, 2022$(92)$— $— 
Three Months Ended March 31, 2021
(in thousands)Investment Securities Available for SaleOther InvestmentsGGL / SBA
Loans Servicing Asset		Earnout
Liability		Visa Derivative
Beginning balance$2,021 $1,021 $3,258 $(5,677)$(2,048)
Total gains (losses) realized/unrealized:
Included in earnings— 32 (178)— — 
Sales(2,021)— — — — 
Additions— — 225 — — 
Settlements— — — — 280 
Ending balance$— $1,053 $3,305 $(5,677)$(1,768)
Total net gains (losses) for the period included in earnings attributable to the change in unrealized gains/(losses) relating to assets/liabilities still held at March 31, 2021$— $32 $— $— $— 

22


September 30, 2017December 31, 2016
Valuation TechniqueSignificant Unobservable InputRange/Weighted AverageRange/Weighted Average
Assets and liabilities
measured at fair value
on a recurring basis
Investment Securities Available for Sale - Other Investments:
Trust preferred securitiesDiscounted cash flow analysisCredit spread embedded in discount rate398 bps442 bps
Private equity investmentsIndividual analysis of each investee companyMultiple factors, including but not limited to, current operations, financial condition, cash flows, evaluation of business management and financial plans, and recently executed financing transactions related to the investee companiesN/AN/A
Discount for lack of liquidity(1)
N/A15%
GGL/SBA loans servicing assetDiscounted cash flow analysisDiscount rate Prepayment speeds12.19% 6.75%N/A
Earnout liabilityOption pricing methods and Monte Carlo simulationGlobal One Earnout, as defined in merger agreement, for the five years ending October 1, 2021
$11.8 million -
$16.7 million
$9.3 million -
$14.2 million
Visa derivative liabilityDiscounted cash flow analysisEstimated timing of resolution of covered litigation, future cumulative deposits to the litigation escrow for settlement of the covered litigation, and estimated future monthly fees payable to the derivative counterparty1-5 years1-5 years
(1) Represents management's estimate of discount that market participants would require based on the instrument's lack of liquidity.

Assets Measured at Fair Value on a Non-recurring Basis
Certain assets are recorded at fair value on a non-recurring basis. These non-recurring fair value adjustments typically are a result of the application of lower of cost or fair value accounting or a write-down occurring during the period. For example, if the fair value of an asset in these categories falls below its cost basis, it is considered to be at fair value at the end of the period of the adjustment. The following table presents assets measured at fair value on a non-recurring basis as of the dates indicated for which there was a fair value adjustment during the period.adjustment.
March 31, 2022Fair Value Adjustments for the Three Months Ended March 31, 2022Location in Consolidated Statements of Income
(in thousands)Level 1Level 2Level 3
Loans(1)        
$— $— $7,483 $339 Provision for credit losses
Other assets held for sale— — 2,725 492 Other operating expense
March 31, 2021Fair Value Adjustments for the Three Months Ended March 31, 2021Location in Consolidated Statements of Income
Level 1Level 2Level 3
Loans(1)        
$— $— $14,026 $7,002 Provision for credit losses


September 30, 2017 December 31, 2016
(in thousands)Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total
Impaired loans*
$—
 —
 3,114
 3,114
 —
 —
 21,742
 21,742
Other loans held for sale—
 —
 31,253
 31,253
 —
 —
 —
 —
Other real estate—

—

8,137

8,137
 —
 —
 19,305
 19,305
Other assets held for sale—
 —
 4,033
 4,033
 —
 —
 12,083
 12,083
                
* (1)    Collateral-dependent impaired loans that were written down to fair value during the period.of collateral.

The following table presents fair value adjustments recognizedORE properties are included in earnings for the nine and three months ended September 30, 2017 and 2016 for the assets measured at fair value on a non-recurring basis.
 Nine Months Ended September 30, Three Months Ended September 30,
(in thousands)2017 2016 2017 2016
Impaired loans*
$1,075
 1,329
 $83
 59
Other loans held for sale25,051
 2,096
 25,051
 2,096
Other real estate5,165
 2,405
 5,165
 968
Other assets held for sale1,683
 7,532
 1,683
 907
        
* Collateral-dependent impaired loans that were written down to fair value during the period.


















The table below provides an overview of the valuation techniques and significant unobservable inputs used in those techniques to measure financial instruments that are classified within Level 3 of the valuation hierarchy and are measured at fair value on a non-recurring basis. The range of sensitivities that management utilized in its fair value calculations is deemed acceptable in the industry with respect to the identified financial instruments.
September 30, 2017December 31, 2016
Valuation TechniqueSignificant Unobservable Input
Range
(Weighted Average)(1)
Range
(Weighted Average)(1)
Assets measured at fair
value on a non-recurring basis
Collateral dependent impaired loansThird-party appraised value of collateral less estimated selling costs
Discount to appraised value (2)
Estimated selling costs
0% - 60% (43%)
0% - 10% (7%)
0%-52% (25%)
0%-10% (7%)
Other loans held for saleThird-party appraised value of collateral less estimated selling costs
Discount to appraised value (2)
Estimated selling costs
0% - 85% (48%)
0% - 10% (2%)
N/A
Other real estateThird-party appraised value of real estate less estimated selling costs
Discount to appraised value (2)
Estimated selling costs
0% - 86% (32%)
0% - 10% (7%)
0%-10% (5%)
0%-10% (7%)
Other assets held for saleThird-party appraised value less estimated selling costs or BOV
Discount to appraised value (2)
Estimated selling costs
15%-46% (22%)
0%-10% (7%)
0%-81% (47%)
0%-10% (7%)
(1) The range represents management's estimate of the high and low of the value that would be assigned to a particular input. For assets measured at fair value on a non-recurring basis, the weighted average is the measure of central tendencies; it is not the value that management is using for the asset or liability.
(2) Synovus also makes adjustments to the values of the assets listed above for reasons including age of the appraisal, information known by management about the property, such as occupancy rates, changes to the physical condition of the property, and other factors. 3Q17 included certain balance sheet restructuring actions which included discounts to fair value for planned accelerated dispositions of other loans held for sale, other real estate, and other assets held for sale.

on the consolidated balance sheets. The carrying value of ORE at March 31, 2022 and December 31, 2021 was $11.4 million and $11.8 million, respectively.
Fair Value of Financial Instruments
The following table presentstables present the carrying and fair values of financial instruments at September 30, 2017 and December 31, 2016. The fair values represent management’s estimates based on various methodologies and assumptions. For financial instruments that are not recorded at fair value on the balance sheet, such as loans held for investment, interest bearing deposits (including brokered deposits), and long-term debt, the fair value amounts should not be taken as an estimate of the amount that would be realized if all such financial instruments were to be settled immediately.










The carrying and estimated fair values of financial instruments as well as the level within the fair value hierarchy, as of September 30, 2017at March 31, 2022 and December 31, 20162021. The fair values represent management’s best estimates based on a range of methodologies and assumptions. See "Part II - Item 8. Financial Statements and Supplementary Data - Note 1 - Summary of Significant Accounting Policies" to the consolidated financial statements of Synovus' 2021 Form 10-K for a description of how fair value measurements are as follows:determined.
March 31, 2022
(in thousands)Carrying ValueFair ValueLevel 1Level 2Level 3
Financial assets
Total cash, cash equivalents, and restricted cash$1,553,503 $1,553,503 $1,553,503 $— $— 
Trading securities9,618 9,618 — 9,618 — 
Investment securities available for sale10,463,101 10,463,101 394,586 10,068,515 — 
Loans held for sale723,921 720,640 — 111,992 608,648 
Other investments12,093 12,093 — — 12,093 
Mutual funds and mutual funds held in rabbi trusts43,842 43,842 43,842 — — 
Loans, net39,754,194 39,988,199 — — 39,988,199 
GGL/SBA loans servicing asset3,451 3,451 — — 3,451 
FRB and FHLB stock174,191 174,191 — 174,191 — 
Derivative assets160,545 160,545 — 160,545 — 
Financial liabilities
Non-interest-bearing deposits$16,611,344 $16,611,344 $— $16,611,344 $— 
Non-time interest-bearing deposits27,876,322 27,876,322 — 27,876,322 — 
Time deposits4,168,578 4,149,009 — 4,149,009 — 
Total deposits$48,656,244 $48,636,675 $— $48,636,675 $— 
Federal funds purchased and securities sold under repurchase agreements501,124 501,124 501,124 — — 
Trading liability for short positions389 389 — 389 — 
Other short-term borrowings400,000 400,000 — 400,000 — 
Long-term debt805,259 820,634 — 820,634 — 
Mutual funds held in rabbi trusts28,095 28,095 28,095 — — 
Derivative liabilities231,863 231,863 — 230,087 1,776 

23


 September 30, 2017

(in thousands)
Carrying Value Fair Value Level 1 Level 2 Level 3
Financial assets         
Cash and cash equivalents$386,459
 386,459
 386,459
 —
 —
Interest bearing funds with Federal Reserve Bank1,297,581
 1,297,581
 1,297,581
 —
 —
Interest earning deposits with banks6,047
 6,047
 6,047
 —
 —
Federal funds sold and securities purchased under resale agreements48,820
 48,820
 48,820
 —
 —
Trading account assets12,329
 12,329
 —
 12,329
 —
Mortgage loans held for sale54,072
 54,072
 —
 54,072
 —
Other loans held for sale31,253
 31,253
 —
 —
 31,253
Investment securities available for sale3,825,443
 3,825,443
 86,343
 3,737,182
 1,918
Private equity investments15,671
 15,671
 —
 —
 15,671
Mutual funds held in rabbi trusts13,439
 13,439
 13,439
 —
 —
Loans, net of deferred fees and costs24,487,360
 24,193,343
 —
 —
 24,193,343
GGL/SBA loans servicing asset4,270
 4,270
 —
 —
 4,270
Derivative assets15,870
 15,870
 —
 15,870
 —
          
Financial liabilities         
Trading account liabilities7,860
 7,860
   7,860
  
Non-interest bearing deposits7,302,682
 7,302,682
 —
 7,302,682
 —
Interest bearing deposits18,883,546
 18,891,446
 —
 18,891,446
 —
Federal funds purchased, other short-term borrowings and other short-term liabilities141,539
 141,539
 141,539
 —
 —
Long-term debt1,882,607
 1,929,043
 —
 1,929,043
 —
Other liabilities16,000
 16,000
 —
 —
 16,000
Derivative liabilities17,094
 17,094
 —
 12,401
 4,693
          
December 31, 2021
(in thousands)Carrying ValueFair ValueLevel 1Level 2Level 3
Financial assets
Total cash, cash equivalents, and restricted cash$3,009,853 $3,009,853 $3,009,853 $— $— 
Trading securities8,391 8,391 — 8,391 — 
Investment securities available for sale10,918,329 10,918,329 117,838 10,800,491 — 
Loans held for sale750,642 749,980 — 108,198 641,782 
Other investments12,185 12,185 — — 12,185 
Mutual funds and mutual funds held in rabbi trusts43,657 43,657 43,657 — — 
Loans, net38,884,361 39,118,275 — — 39,118,275 
GGL/SBA loans servicing asset3,233 3,233 — — 3,233 
FRB and FHLB stock159,941 159,941 — 159,941 — 
Derivative assets191,708 191,708 — 191,708 — 
Financial liabilities
Non-interest-bearing deposits$16,392,653 $16,392,653 $— $16,392,653 $— 
Non-time interest-bearing deposits28,917,148 28,917,148 — 28,917,148 — 
Time deposits4,117,475 4,125,673 — 4,125,673 — 
Total deposits$49,427,276 $49,435,474 $— $49,435,474 $— 
Federal funds purchased and securities sold under repurchase agreements264,133 264,133 264,133 — — 
Trading liability for short positions200 200 — 200 — 
Long-term debt1,204,229 1,243,147 — 1,243,147 — 
Mutual funds held in rabbi trusts27,205 27,205 27,205 — — 
Derivative liabilities98,602 98,602 — 95,067 3,535 
 December 31, 2016

(in thousands)
Carrying Value Fair Value Level 1 Level 2 Level 3
Financial assets         
Cash and cash equivalents$395,175
 395,175
 395,175
 —
 —
Interest bearing funds with Federal Reserve Bank527,090
 527,090
 527,090
 —
 —
Interest earning deposits with banks18,720
 18,720
 18,720
 —
 —
Federal funds sold and securities purchased under resale agreements58,060
 58,060
 58,060
 —
 —
Trading account assets9,314
 9,314
 1,890
 7,424
 —
Mortgage loans held for sale51,545
 51,545
 —
 51,545
 —
Investment securities available for sale3,718,195
 3,718,195
 114,676
 3,601,723
 1,796
Private equity investments25,493
 25,493
 —
 —
 25,493
Mutual funds held in rabbi trusts11,479
 11,479
 11,479
 —
 —
Loans, net of deferred fees and costs23,856,391
 23,709,434
 —
 —
 23,709,434
Derivative assets20,623
 20,623
 —
 20,623
 —
          
Financial liabilities         
Non-interest bearing deposits7,085,804
 7,085,804
 —
 7,085,804
 —
Interest bearing deposits17,562,256
 17,560,021
 —
 17,560,021
 —
Federal funds purchased, other short-term borrowings and other short-term liabilities159,699
 159,699
 159,699
 —
 —
Long-term debt2,160,881
 2,217,544
 —
 2,217,544
 —
Other liabilities14,000
 14,000
 —
 —
 14,000
Derivative liabilities23,299
 23,299
 —
 17,531
 5,768
          

Note 97 - Derivative Instruments and Hedging Activities
As part of its overall interest rate risk management activities, Synovus utilizes derivative instruments to manage its exposure to various types of interest rate risk. Theserisk, exposures related to liquidity and credit risk, and to facilitate client transactions. The primary types of derivative instruments generallyutilized by Synovus consist of interest rate swaps, interest rate lock commitments made to prospective mortgage loan customers, andclients, commitments to sell fixed-rate mortgage loans.loans, and foreign currency exchange forwards. Interest rate lock commitments represent derivative instruments since it is intended that such loans will be sold.
Synovus may also utilize interest rate swaps to manage interest rate risks primarily arising from its core banking activities. These interest rate swap transactions generally involve the exchange of fixed and floating interest rate payment obligations without the exchange of underlying principal amounts. Swaps may be designated as either cash flow hedges or fair value hedges, as discussed below. As of September 30, 2017 and December 31, 2016, Synovus had no outstanding interest rate swap contracts utilized to manage interest rate risk related to core banking activities.
Synovus is party to master netting arrangements with its dealer counterparties; however, Synovus does not offset assets and liabilities under these arrangements for financial statement presentation purposes. See "Part II - Item 8. Financial Statements and Supplementary Data - Note 1 - Summary of Significant Accounting Policies" to the consolidated financial statements of Synovus' 2021 Form 10-K for additional information regarding accounting policies for derivatives.
Hedging Derivatives
Cash flow hedge relationships mitigate exposure to the variability of future cash flows or other forecasted transactions. Synovus has entered into interest rate swap contracts to manage overall cash flow changes related to interest rate risk exposure on index-based variable rate commercial loans. The contracts effectively modify Synovus' exposure to interest rate risk by utilizing receive fixed/pay index-based variable rate interest rate swaps. During the first quarter of 2022, notional amounts of $1.40 billion in forward-starting cash flow hedges were added.
For cash flow hedges, if the hedged exposure is a cash flow exposure, the effective portion of the gain or loss on the derivative instrument is reported initially as a component of accumulated other comprehensive income (loss), net of the tax impact, and subsequently reclassified into earnings when the hedged transaction affects earnings with the impacts recorded in the same income statement line item used to present the earnings effect of the hedged item. When a cash flow hedge relationship is discontinued but the hedged cash flows, or forecasted transactions, are still expected to occur, gains or losses that were accumulated in OCI are amortized into earnings over the same periods which the hedged transactions would have affected earnings. If, however, it is probable the forecasted transactions will no longer occur, the remaining accumulated amounts in OCI for the impacted cash flow hedges are immediately recognized in earnings.
Synovus recorded no unrealized gains during the first quarter of 2022 and $757 thousand, or $565 thousand, after tax, in OCI during the first quarter of 2021, respectively, related to terminated cash flow hedges, which are being recognized into

24


earnings in conjunction with the effective terms of the original swaps through the second quarter of 2026. Synovus recognized pre-tax income of $2.2 million and $1.6 million during the three months ended March 31, 2022 and 2021 related to the amortization of terminated cash flow hedges.
As of March 31, 2022, Synovus expects to reclassify into earnings approximately $26 million in pre-tax loss due to the receipt or payment of interest payments on all cash flow hedges within the next twelve months. Included in this amount is approximately $3 million in pre-tax income related to the amortization of terminated cash flow hedges.As of March 31, 2022, the maximum length of time over which Synovus is hedging its exposure to the variability in future cash flows is through the third quarter of 2026.
For derivative instruments that are not designated as hedging instruments, changes in the fair value of the derivatives are recognized in earnings immediately.
Counterparty Credit Risk and Collateral
Entering into derivative contracts potentially exposes Synovus to the risk of counterparties’ failure to fulfill their legal obligations, including, but not limited to, potential amounts due or payable under each derivative contract. Notional principal amounts are often used to express the volume of these transactions, but the amounts potentially subject to credit risk are much smaller. Synovus assesses the credit risk of its dealer counterparties by regularly monitoring publicly available credit rating information, evaluating other market indicators, and periodically reviewing detailed financials. Dealer collateral requirements are determined via risk-based policies and procedures and in accordance with existing agreements. Synovus seeksseeks to minimize dealer credit risk by dealing with highly rated counterparties and by obtaining collateral for exposures above certain predetermined limits. Management closely monitors credit conditions within the customerclient swap portfolio, which management deems to be of higher risk than dealer counterparties. Collateral is secured at origination and credit related fair value adjustments are recorded against the asset value of the derivative as deemed necessary based upon an analysis, which includes consideration of the current asset value of the swap, customer creditclient risk rating, collateral value, and customerclient standing with regards to its swap contractual obligations and other related matters. Such asset values fluctuate based upon changes in interest rates regardless of changes in notional amounts and changes in customerclient specific risk.
Cash Flow Hedges
As of September 30, 2017 and December 31, 2016, there were no cash flow hedges outstanding. The unamortized deferred net loss balance from previously terminated cash flow hedges at December 31, 2016 of $(130) thousand was recognized during the nine months ended September 30, 2017.
Fair Value Hedges
As of September 30, 2017 and December 31, 2016, there were no fair value hedges outstanding. The unamortized deferred gain balance on all previously terminated fair value hedges at December 31, 2016 of $873 thousand was recognized during the nine months ended September 30, 2017.
Customer Related Derivative Positions
Synovus enters into interest rate swap agreements to facilitate the risk management strategies of a small number of commercial banking customers. Synovus mitigates this risk by entering into equal and offsetting interest rate swap agreements with highly rated counterparties. The interest rate swap agreements are free-standing derivatives and are recorded at fair value on Synovus' Consolidated Balance Sheets. Fair value changes are recorded as a component of non-interest income. As of September 30, 2017, the notional amount of customer related interest rate derivative financial instruments, including both the customer position and the offsetting position, was $1.54 billion, an increase of $216.9 million compared to December 31, 2016.
Visa Derivative
In conjunction with the sale of Class B shares of common stock issued by Visa to Synovus as a Visa USA member, Synovus entered into a derivative contract with the purchaser, which provides for settlements between the parties based upon a change in the ratio for conversion of Visa Class B shares to Visa Class A shares. The conversion ratio changes when Visa deposits funds to a litigation escrow established by Visa to pay settlements for certain litigation, for which Visa is indemnified by Visa USA members. The litigation escrow is funded by proceeds from Visa’s conversion of Class B shares. The fair value of the derivative contract was $4.7 million and $5.8 million at September 30, 2017 and December 31, 2016, respectively. The fair value of the derivative contract is determined based on management's estimate of the timing and amount of the Covered Litigation settlement, and the resulting payments due to the counterparty under the terms of the contract. Management believes that the estimate of Synovus' exposure to the Visa indemnification and fees associated with the Visa derivative is adequate based on current information, including Visa's recent announcements and disclosures. However, future developments in the litigation could require potentially significant

changes to Synovus' estimate. See "Part II - Item 8. Financial Statements and Supplementary Data - Note 19 - Visa Shares and Related Agreements" of Synovus' 2016 Form 10-K for further information.
Mortgage Derivatives
Synovus originates first lien residential mortgage loans for sale into the secondary market. Mortgage loans are sold by Synovus for conversion to securities and the servicing of these loans is generally sold to a third-party servicing aggregator, or Synovus sells the mortgage loans as whole loans to investors either individually or in bulk on a servicing released basis.
Synovus enters into interest rate lock commitments for residential mortgage loans which commits it to lend funds to a potential borrower at a specific interest rate and within a specified period of time. Interest rate lock commitments that relate to the origination of mortgage loans that, if originated, will be held for sale, are considered derivative financial instruments under applicable accounting guidance. Outstanding interest rate lock commitments expose Synovus to the risk that the price of the mortgage loans underlying the commitments may decline due to increases in mortgage interest rates from inception of the rate lock to the funding of the loan.
At September 30, 2017 and December 31, 2016, Synovus had commitments to fund at a locked interest rate, primarily fixed-rate mortgage loans to customers in the amount of $64.3 million and $88.2 million, respectively. Fair value adjustments related to these commitments resulted in a loss of $595 thousand and a gain of $1.0 million for the nine months ended September 30, 2017 and 2016, respectively, which was recorded as a component of mortgage banking income in the Consolidated Statements of Income.
At September 30, 2017 and December 31, 2016, outstanding commitments to sell primarily fixed-rate mortgage loans amounted to $83.0 million and $126.5 million, respectively. Such commitments are entered into to reduce the exposure to market risk arising from potential changes in interest rates, which could affect the fair value of mortgage loans held for sale and outstanding rate lock commitments, which guarantee a certain interest rate if the loan is ultimately funded or granted by Synovus as a mortgage loan held for sale. The commitments to sell mortgage loans are at fixed prices and are scheduled to settle at specified dates that generally do not exceed 90 days. Fair value adjustments related to these outstanding commitments to sell mortgage loans resulted in a loss of $1.9 million and $830.0 thousand for the nine months ended September 30, 2017 and 2016, respectively, which were recorded as a component of mortgage banking income in the Consolidated Statements of Income.
Collateral Requirements
Pursuant to the Dodd-Frank Act, certainCertain derivative transactions have collateral requirements, both at the inception of the trade and as the value of each derivative position changes. As of September 30, 2017,March 31, 2022 and December 31, 2021, collateral totaling $45.8$46.2 million of federal funds soldand $64.5 million, respectively, was pledged to the derivative counterparties to comply with collateral requirements. Effective January 3, 2017,
For derivatives cleared through central clearing houses, the CME amended its rulebook to legally characterize variation margin cash payments for cleared OTC derivativesmade are legally characterized as settlement rather than as collateral.settlements of the derivatives. As a result, these variation margin payments are netted against the fair value of the respective derivative contracts in 2017,the consolidated balance sheets and related disclosures. At March 31, 2022 and December 31, 2021, Synovus beganhad a variation margin of $61.4 million and $94.6 million respectively, each reducing the corresponding derivative assetliability.
The following table reflects the fair value of derivative instruments included in other assets and liability balancesother liabilities on the consolidated balance sheets along with their respective notional amounts.

25


March 31, 2022December 31, 2021
Fair ValueFair Value
(in thousands)Notional AmountDerivative AssetsDerivative LiabilitiesNotional AmountDerivative AssetsDerivative Liabilities
Derivatives in cash flow hedging relationships:
Interest rate contracts$5,000,000 $— $134,369 $3,600,000 $22,004 $20,395 
Total derivatives designated as hedging instruments    $— $134,369 $22,004 $20,395 
Derivatives not designated
  as hedging instruments:
Interest rate contracts(1)
$9,420,004 $156,210 $95,707 $9,653,600 $167,560 $74,514 
Mortgage derivatives - interest rate lock commitments131,642 788 — 99,006 2,105 — 
Mortgage derivatives - forward commitments to sell fixed-rate mortgage loans178,000 3,443 — 105,500 — 122 
Risk participation agreements431,402 — 11 374,214 — 36 
Foreign exchange contracts43,314 104 — 22,387 39 — 
Visa derivative— — 1,776 — — 3,535 
Total derivatives not designated as hedging instruments    $160,545 $97,494 $169,704 $78,207 
(1)    Includes interest rate contracts for CME-cleared OTC derivatives to reflect the settlement of thoseclient swaps and offsetting positions, via the exchangenet of variation margin.margin payments.
Synovus also provides foreign currency exchange services, primarily forward contracts, with counterparties to allow commercial clients to mitigate exchange rate risk. Synovus covers its risk by entering into an offsetting foreign currency exchange forward contract.
The impactfollowing table presents the effect of hedging derivative instruments on the Consolidated Balance Sheets at September 30, 2017consolidated statements of income and Decemberthe total amounts for the respective line item affected for the three months ended March 31, 2016 is presented below.2022 and 2021.

Three Months Ended March 31,
(in thousands)20222021
Total amounts presented in the consolidated statements of income in interest income on loans$8,656 $8,342 
Gain/loss on cash flow hedging relationships:(1)
Interest rate swaps:
Realized gains (losses) reclassified from AOCI, pre-tax, to interest income on loans2,189 1,599 
Pre-tax income recognized on cash flow hedges$2,189 $1,599 
(1)    See "Part I - Item 1. Financial Statements and Supplementary Data - Note 5 - Shareholders' Equity and Other Comprehensive Income (Loss)" in this Report for additional information.


26

 Fair Value of Derivative Assets Fair Value of Derivative Liabilities

(in thousands)
Location on Consolidated Balance Sheets September 30, 2017 December 31, 2016 Location on Consolidated Balance Sheets September 30, 2017 December 31, 2016
Derivatives not designated
  as hedging instruments:
           
Interest rate contractsOther assets $14,896
 17,157
 Other liabilities 12,369
 17,531
Mortgage derivativesOther assets 974
 3,466
 Other liabilities 32
 —
Visa derivative  —
 —
 Other liabilities 4,693
 5,768
 Total derivatives not
  designated as hedging
  instruments    
  $15,870
 20,623
   17,094
 23,299
            

The pre-tax effect of changes in fair value hedgesfrom derivative instruments not designated as hedging instruments on the Consolidated Statementsconsolidated statements of Incomeincome for the nine and three months ended September 30, 2017March 31, 2022 and 20162021 is presented below.
Gain (Loss) Recognized in Consolidated Statements of Income
Three Months Ended March 31,
(in thousands)Location in Consolidated Statements of Income20222021
Derivatives not designated
  as hedging instruments:
Interest rate contracts(1)    
Capital markets income$673 $947 
Risk participation agreementsCapital markets income25 201 
Foreign exchange contractsCapital markets income65 — 
Mortgage derivatives - interest rate lock commitmentsMortgage banking income(1,318)(1,719)
Mortgage derivatives - forward commitments to sell fixed-rate mortgage loansMortgage banking income3,565 6,242 
Total derivatives not designated as hedging instruments$3,010 $5,671 
  Location of Gain (Loss) Recognized in Income Gain (Loss) Recognized in Income
(in thousands)  Nine Months Ended September 30,
Derivatives not designated as hedging instruments  2017 2016
Interest rate contracts(1)    
 Other non-interest income $(5) 39
Mortgage derivatives(2)    
 Mortgage banking income (2,524) 189
Total   $(2,529) 228
       
       
    Gain (Loss) Recognized in Income
(in thousands)   Three Months Ended September 30,
Derivatives not designated as hedging instruments Location of Gain (Loss) Recognized in Income 2017 2016
Interest rate contracts(1)    
 Other non-interest income $(4) 5
Mortgage derivatives(2)    
 Mortgage banking income (451) 674
Total   $(455) 679
       
(1)Gain (loss) represents net fair value adjustments (including credit related adjustments) for customerclient swaps and offsetting positions.
(2) Gain (loss) represents net fair value adjustments recorded for interest rate lock commitments and commitments to sell mortgage loans to third-party investors.
During the nine months ended September 30, 2017 and 2016, Synovus reclassified $873 thousand and $1.4 million, respectively, from hedge-related basis adjustment, a component of long-term debt, as a reduction to interest expense. During the nine months ended September 30, 2016, Synovus reclassified $1.3 million from hedge-related basis adjustment, as a reduction to loss on early extinguishment of debt, net. As of September 30, 2017, all deferred gains related to hedging relationships that had been previously terminated had been recognized into earnings.

Note 108 - Net Income Per Common Share
The following table displays a reconciliation of the information used in calculating basic and diluted earningsnet income per common share for the nine and three months ended September 30, 2017March 31, 2022 and 2016.

Nine Months Ended September 30, Three Months Ended September 30,
(in thousands, except per share data)2017 2016 2017 2016
Basic Net Income Per Common Share:       
Net income available to common shareholders$238,190
 170,555
 $95,448
 62,686
Weighted average common shares outstanding121,796
 125,076
 120,900
 122,924
Net income per common share, basic$1.96
 1.36
 $0.79
 0.51
Diluted Net Income Per Common Share:       
Net income available to common shareholders$238,190
 170,555
 $95,448
 62,686
Weighted average common shares outstanding121,796
 125,076
 120,900
 122,924
Potentially dilutive shares from outstanding equity-based awards and Earnout Payments832
 636
 914
 680
Weighted average diluted common shares122,628
 125,712
 121,814
 123,604
Net income per common share, diluted$1.94
 1.36
 $0.78
 0.51
        
Basic net income per common share is computed by dividing net income by the average common shares outstanding for the period.2021. Diluted net income per common share reflectsincorporates the dilution that could occur if securities or other contracts to issue common stock were exercised or converted. The dilutive effectpotential impact of outstanding options and restricted share units is reflected in diluted net income per common share, unless the impact is anti-dilutive, by applicationcontingently issuable shares, including awards which require future service as a condition of delivery of the treasury stock method.underlying common stock.
As of September 30, 2017 and 2016,
Three Months Ended March 31,
(in thousands, except per share data)20222021
Basic Net Income Per Common Share:
Net income available to common shareholders$162,746 $178,802 
Weighted average common shares outstanding145,273 148,467 
Net income per common share, basic$1.12 $1.20 
Diluted Net Income Per Common Share:
Net income available to common shareholders$162,746 $178,802 
Weighted average common shares outstanding145,273 148,467 
Effect of dilutive outstanding equity-based awards and earnout payments1,392 1,313 
Weighted average diluted common shares146,665 149,780 
Net income per common share, diluted$1.11 $1.19 
For the three months ended March 31, 2022, there were 2.2 million and 2.5 million, respectively,no potentially dilutive shares, and for the three months ended March 31, 2021, there were 32 thousand related to the Warrant and stock options to purchase shares of common stock that were outstanding during 2017 and 2016, butoutstanding. These potentially dilutive shares were not included in the computation of diluted net income per common share because the effect would have beenbe anti-dilutive.
Note 11 - Share-based Compensation
General Description of Share-based Plans
Synovus has a long-term incentive plan under which the Compensation Committee of the Board of Directors has the authority to grant share-based awards to Synovus employees. At September 30, 2017, Synovus had a total of 5.7 million shares of its authorized but unissued common stock reserved for future grants under the 2013 Omnibus Plan. The 2013 Omnibus Plan authorizes 8.6 million common share equivalents available for grant, where grants of options count as one share equivalent and grants of full value awards (e.g., restricted share units, market restricted share units, and performance share units) count as two share equivalents. Any restricted share units that are forfeited and options that expire unexercised will again become available for issuance under the Plan. The Plan permits grants of share-based compensation including stock options, restricted share units, market restricted share units, and performance share units. The grants generally include vesting periods ranging from three to five years and contractual terms of ten years. Stock options are granted at exercise prices which equal the fair value of a share of common stock on the grant-date. Market restricted share units and performance share units are granted at target and are compared annually to required market and performance metrics to determine final units vested and compensation expense. Synovus has historically issued new shares to satisfy share option exercises and share unit conversions. Dividend equivalents are paid on outstanding restricted share units, market restricted share units, and performance share units in the form of additional restricted share units that vest over the same vesting period or the vesting period left on the original restricted share unit grant.
Share-based Compensation Expense
Total share-based compensation expense was $10.6 million and $3.7 million for the nine and three months ended September 30, 2017, respectively, and $10.2 million and $3.4 million for the nine and three months ended September 30, 2016, respectively.
Stock Options
No stock option grants were made during the nine months ended September 30, 2017. At September 30, 2017, there were 809 thousand outstanding stock options to purchase shares of common stock with a weighted average exercise price of $17.82 per share.

Restricted Share Units, Performance Share Units, and Market Restricted Share Units
During the nine months ended September 30, 2017, Synovus awarded 235 thousand restricted share units that have a service-based vesting period of three years and awarded 73 thousand performance share units that vest upon service and performance conditions. Synovus also granted 73 thousand market restricted share units during the nine months ended September 30, 2017. The weighted average grant-date fair value of the awarded restricted share units, performance share units and market restricted share units was $41.95 per share. Market restricted share units and performance share units are granted at target and are compared annually to required market and performance metrics. The performance share units vest upon meeting certain service and performance conditions. Return on average assets (ROAA) performance is evaluated each year over a three-year performance period, with share distribution determined at the end of the three years. The number of performance share units that will ultimately vest ranges from 0% to 150% of target based on Synovus' three-year weighted average ROAA (as defined). The market restricted share units have a three-year service-based vesting component as well as a total shareholder return multiplier. The number of market restricted share units that will ultimately vest ranges from 75% to 125% of target based on Synovus' total shareholder return. At September 30, 2017, including dividend equivalents granted, there were 973 thousand restricted share units, performance share units and market restricted share units outstanding with a weighted average grant-date fair value of $32.91 per share.
Note 129 - Commitments and Contingencies
In the normal course of business, Synovus enters into commitments to extend credit such as loan commitments and letters of credit to meet the financing needs of its customers.clients. Synovus uses the same credit policies in making commitments and conditional obligations as it does for on-balance sheet instruments. Commitments to extend credit are agreements to lend to a customerclient as long as there is no violation of any condition established in the contract. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Synovus also has commitments to fund certain tax credits, CRA partnerships, and other investments.

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The contractual amount of these financial instruments represents Synovus' maximum credit risk should the counterparty draw upon the commitment, and should the counterparty subsequently fail to perform according to the terms of the contract. Since many of the commitments are expected to expire without being drawn upon, total commitment amounts do not necessarily represent future cash requirements. Additionally, certain commitments (primarily consumer) can generally be canceled by providing notice to the borrower.
The allowance for credit lossesACL associated with unfunded commitments and letters of credit is a component of the unfunded commitments reserve recorded within other liabilities on the Consolidated Balance Sheets.consolidated balance sheets. At March 31, 2022, the ACL for unfunded commitments was $47.3 million, compared to a reserve of $41.9 million at December 31, 2021. Additionally, an immaterial amount of unearned fees relating to letters of credit are recorded within other liabilities on the Consolidated Balance Sheets. These amountsconsolidated balance sheets.
Synovus invests in certain LIHTC partnerships which are engaged in the development and operation of affordable multi-family housing pursuant to Section 42 of the Code. Additionally, Synovus invests in certain solar energy tax credit partnerships pursuant to Section 48 of the Code and certain new market tax credit partnerships pursuant to section 45D of the Code. Synovus typically acts as a limited partner in these investments and does not materialexert control over the operating or financial policies of the partnerships and as such, is not considered the primary beneficiary of the partnership. For certain of its LIHTC investments, Synovus provides financing during the construction and development of the properties and is at risk for the funded amount of its equity investment plus the outstanding amount of any construction loans in excess of the fair value of the collateral for the loan, but has no obligation to Synovus' Consolidated Balance Sheets.fund the operations or working capital of the partnerships and is not exposed to losses beyond Synovus’ investment. Synovus receives tax credits related to these investments which are subject to recapture by taxing authorities based on compliance provisions required to be met at the project level.
Unfunded lending commitmentsSynovus also invests in CRA partnerships, including SBIC programs, and lettersother investments. The SBIC is a program initiated by the SBA in 1958 to assist in the funding of creditsmall business loans.
(in thousands)March 31, 2022December 31, 2021
Letters of credit(1)
$182,873 $183,463 
Commitments to fund commercial and industrial loans9,491,517 9,595,793 
Commitments to fund commercial real estate, construction, and land development loans3,639,109 3,593,171 
Commitments under home equity lines of credit1,847,718 1,805,869 
Unused credit card lines478,586 473,582 
Other loan commitments650,708 604,353 
Total letters of credit and unfunded lending commitments$16,290,511 $16,256,231 
Tax credits, CRA partnerships, and other investments:
Carrying amount included in other assets$446,326 $426,137 
Amount of future funding commitments263,024 250,733 
Permanent and short-term construction loans and letter of credit commitments(2)
199,623 204,391 
Funded portion of permanent and short-term loans and letters of credit(3)
135,415 104,315 
(1)    Represent the contractual amount net of risk participations purchased of $26.1 million and $26.1 million at September 30, 2017March 31, 2022 and December 31, 2016 are presented below.2021, respectively.
(in thousands)September 30, 2017 December 31, 2016
Letters of credit*$152,082
 150,948
Commitments to fund commercial real estate, construction, and land development loans1,309,144
 1,394,162
Unused credit card lines1,170,429
 1,103,431
Commitments under home equity lines of credit1,133,569
 1,096,052
Commitments to fund commercial and industrial loans5,164,553
 4,792,834
Other loan commitments326,672
 307,772
Total unfunded lending commitments and letters of credit$9,256,449
 8,845,199
    
* (2)    Represent the contractual amount net of risk participations of approximately $63$2.0 million and $83$3.0 million at September 30, 2017March 31, 2022 and December 31, 2016,2021.
(3)    Represent the contractual amount net of risk participations of $2.9 million and $3.0 million at March 31, 2022 and December 31, 2021.
Merchant Services
In accordance with credit and debit card association rules, Synovus provides merchant processing services for clients with a contractual arrangement under which certain sales and processing support are provided through an outside merchant services provider with Synovus owning the merchant contract relationship. In addition, Synovus sponsors various third-party MPS businesses that process credit and debit card transactions on behalf of merchants. In connection with these services, a liability may arise in the event of a billing dispute between the merchant and a cardholder that is ultimately resolved in the cardholder's favor. If the merchant defaults on its obligations, the cardholder, through its issuing bank, generally has until six months after the date of the transaction to present a chargeback to the MPS, which is primarily liable for any losses on covered transactions. However, if a sponsored MPS fails to meet its obligations, then Synovus, as the sponsor, could be held liable for the disputed amount. Synovus seeks to mitigate this risk through its contractual arrangements with the MPS and the merchants by withholding future settlements, retaining cash reserve accounts and/or obtaining other security. For the three months ended March 31, 2022 and 2021, Synovus and the sponsored entities processed and settled $28.61 billion and $26.25 billion of transactions, respectively.

Note 13 -

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Legal Proceedings
Synovus and its subsidiaries are subject to various legal proceedings, claims and claimsdisputes that arise in the ordinary course of its business. Additionally, in the ordinary course of its business, Synovus and its subsidiaries are subject to regulatory and governmental examinations, information gathering requests, inquiries and investigations. Synovus, like many other financial institutions, has been the target of numerous legal actions and other proceedings asserting claims for damages and related relief for losses. These actions include mortgage loan and other loan put-back claims, claims and counterclaims asserted by individual borrowers related to their loans, and allegations of violations of state and federal laws and regulations relating to banking practices, including putative class action matters. In addition to actual damages, if Synovus does

not prevail in such asserted legal actions, credit-related litigation could result in additional write-downs or charge-offs of loans,assets, which could adversely affect Synovus' results of operations during the period in which the write-down or charge-off were to occur.
Synovus carefully examines and considers each legal matter, and, in those situations where Synovus determines that a particular legal matter presents loss contingencies that are both probable and reasonably estimable, Synovus establishes an appropriate accrual.reserve. An event is considered to be probable if the future event is likely to occur. While the final outcome of any legal proceeding is inherently uncertain, based on the information currently available, advice of counsel and available insurance coverage, management believes that the amounts accrued with respect to legal matters as of September 30, 2017March 31, 2022 are adequate. The actual costs of resolving legal claims may be higher or lower than the amounts accrued.
In addition, where Synovus determines that there is a reasonable possibility of a loss in respect of legal matters, Synovus considers whether it is able to estimate the total reasonably possible loss or range of loss. An event is “reasonably possible” if “the chance of the future event or events occurring is more than remote but less than likely.” An event is “remote” if “the chance of the future event or future eventevents occurring is more than slight but less than reasonably possible." In many situations, Synovus may be unable to estimate reasonably possible losses due to the preliminary nature of the legal matters, as well as a variety of other factors and uncertainties. For those legal matters where Synovus is able to estimate a range of reasonably possible losses, management currently estimates the aggregate range from our outstanding litigation is from zero to $10$5 million in excess of the amounts accrued, if any, related to those matters. This estimated aggregate range is based upon information currently available to Synovus, and the actual losses could prove to be lower or higher. As there are further developments in these legal matters, Synovus will reassess these matters, and the estimated range of reasonably possible losses may change as a result of this assessment. Based on Synovus' current knowledge and advice of counsel, management presently does not believe that the liabilities arising from these legal matters will have a material adverse effect on Synovus' consolidated financial condition, results of operations or cash flows. However, it is possible that the ultimate resolution of these legal matters could have a material adverse effect on Synovus' results of operations or financial condition for any particular period.
Synovus intends to vigorously pursue all available defenses to these legal matters, but will also consider other alternatives, including settlement, in situations where there is an opportunity to resolve such legal matters on terms that Synovus considers to be favorable, including in light of the continued expense and distraction of defending such legal matters. Synovus maintains insurance coverage, which may be available to cover legal fees, or potential losses that might be incurred in connection with such legal matters. The above-noted estimated range of reasonably possible losses does not take into consideration insurance coverage which may or may not be available for the respective legal matters.
Note 1410 - Subsequent EventsSegment Reporting

Synovus' business segments are based on the products and services provided or the clients served and reflect the manner in which financial information is evaluated by the chief operating decision maker. During the first quarter of 2022, Synovus reorganized its internal management reporting structure to separate the previous Community Banking segment into Consumer Banking and Community Banking segments. Accordingly, its operating segment reporting structure was also updated. Synovus now has 4 major reportable business segments: Wholesale Banking, Community Banking, Consumer Banking, and Financial Management Services, with functional activities such as treasury, technology, operations, marketing, finance, enterprise risk, legal, human resources, corporate communications, executive management, among others, included in Treasury and Corporate Other.
On September 25, 2017, Synovus issued a notice of redemptionBusiness segment results are determined based upon Synovus' management reporting system, which assigns balance sheet and income statement items to redeem alleach of the $300.0 million aggregate principal amountbusiness segments. Certain assets, liabilities, revenue, and expense not allocated or attributable to a particular business segment are included in Treasury and Corporate Other.Synovus's third-party lending consumer loans and loans held for sale as well as PPP loans are included in Treasury and Corporate Other. The management accounting policies and processes utilized in compiling segment financial information are highly subjective and, unlike financial accounting, are not based on authoritative guidance similar to GAAP. As a result, reported segment results are not necessarily comparable with similar information reported by other financial institutions.

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The Wholesale Banking business segment serves primarily larger corporate clients by providing commercial lending, capital markets, and deposit services through specialty teams including middle market, CRE, senior housing, national accounts, premium finance, structured lending, healthcare, asset-based lending, and community investment capital.
The Community Banking business segment serves small and medium-sized commercial clients as well as individual private wealth clients using a relationship-based approach. The commercial component of its outstanding 7.875% senior notes due 2019this segment focuses on November 9, 2017 at a “make whole” premium, plus accrued but unpaid interest on the 2019 noteslocally owned and operated businesses.Private wealth services are delivered to the redemption date.  individuals operating the businesses as well as other individuals in the communities in which the Community Bank operates. A comprehensive set of banking products are offered to the client set including a full suite of lending and depository products as well as financial planning services.
The resultsConsumer Banking business segment serves individual and small business clients through its branch and ATM network, in addition to digital and telephone channels. This segment provides individuals and small businesses with an array of comprehensive banking products and services including depository accounts, credit and debit cards, payment solutions, goal-based planning, home equity and other consumer loans, and small business lending solutions.
The Financial Management Services business segment serves its clients by providing mortgage and trust services and also specializing in professional portfolio management for fixed-income securities, investment banking, the execution of securities transactions as a broker/dealer, asset management, financial planning, and family office services, as well as the provision of individual investment advice on equity and other securities.
Synovus uses a centralized FTP methodology to attribute appropriate net interest income to the business segments. The intent of the FTP methodology is to transfer interest rate risk from the business segments by providing matched duration funding of assets and liabilities. The result is to centralize the financial impact, management, and reporting of interest rate risk in the Treasury and Corporate Other function where it can be centrally monitored and managed. Treasury and Corporate Other includes certain assets and/or liabilities managed within that function. Additionally, Treasury and Corporate Other also charges (credits) an internal cost of funds for assets held in (or pays for funding provided by) each business segment. The process for determining FTP is based on a number of factors and assumptions, including prevailing market interest rates, the expected lives of various assets and liabilities, and the Company's broader funding profile.
The following tables present certain financial information for each reportable business segment for the three months ending Decemberended March 31, 2017 will include2022 and 2021. The application and development of management reporting methodologies is a pre-tax lossdynamic process and is subject to periodic enhancements. As these enhancements are made, financial results presented by each reportable business segment may be periodically revised.Loan and deposit transfers occur from time to time between reportable business segments primarily to maintain the migration of approximately $24 million related to early extinguishment ofclients between segments. Prior period loan and deposit segment balances are not adjusted for these notes. transfers.

Three Months Ended March 31, 2022
(in thousands)Wholesale BankingCommunity BankingConsumer BankingFinancial Management ServicesTreasury and Corporate OtherSynovus Consolidated
Net interest income$157,477 $97,321 $97,556 $18,444 $21,450 $392,248 
Non-interest revenue8,398 13,583 21,644 45,164 16,545 105,334 
Non-interest expense26,648 30,420 44,715 44,139 126,528 272,450 
Pre-provision net revenue$139,227 $80,484 $74,485 $19,469 $(88,533)$225,132 
On November 1, 2017, Synovus completed a public offering of $300.0 million of 3.125% senior notes due 2022. Proceeds from this offering will be used, in part, to fund the redemption of the 2019 notes. 
Three Months Ended March 31, 2021
(in thousands)Wholesale BankingCommunity BankingConsumer BankingFinancial Management ServicesTreasury and Corporate OtherSynovus Consolidated
Net interest income$134,074 $99,140 $107,102 $20,995 $12,546 $373,857 
Non-interest revenue7,319 10,620 19,134 58,583 15,300 110,956 
Non-interest expense20,724 26,920 43,556 47,674 128,260 267,134 
Pre-provision net revenue$120,669 $82,840 $82,680 $31,904 $(100,414)$217,679 







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March 31, 2022
(dollars in thousands)Wholesale BankingCommunity BankingConsumer BankingFinancial Management ServicesTreasury and Corporate OtherSynovus Consolidated
Loans, net of deferred fees and costs$22,393,060 $8,319,687 $2,580,858 $4,991,359 $1,884,186 $40,169,150 
Total deposits$11,921,931 $12,589,784 $20,115,909 $818,297 $3,210,323 $48,656,244 
Total full-time equivalent employees292 596 1,553 788 1,678 4,907 
December 31, 2021
(dollars in thousands)Wholesale BankingCommunity BankingConsumer BankingFinancial Management ServicesTreasury and Corporate OtherSynovus Consolidated
Loans, net of deferred fees and costs$21,496,050 $8,231,451 $2,559,892 $4,994,494 $2,030,071 $39,311,958 
Total deposits$12,370,554 $12,557,631 $19,668,846 $826,639 $4,003,606 $49,427,276 
Total full-time equivalent employees284 607 1,532 794 1,670 4,887 


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ITEM 2. – MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
In this Report, the words “Synovus,” “the Company,” “we,” “us,” and “our” refer to Synovus Financial Corp. together with Synovus Bank and Synovus' other wholly-owned subsidiaries, except where the context requires otherwise.
FORWARD-LOOKING STATEMENTS
Certain statements made or incorporated by reference in this Report which are not statements of historical fact, including those under "Management's“Management's Discussion and Analysis of Financial Condition and Results of Operations,"” and elsewhere in this Report, constitute forward-looking statements within the meaning of, and subject to the protections of, Section 27A of the Securities Act and Section 21E of the Exchange Act. Forward-looking statements include statements with respect to Synovus' beliefs, plans, objectives, goals, targets, expectations, anticipations, assumptions, estimates, intentions and future performance and involve known and unknown risks, many of which are beyond Synovus' control and which may cause Synovus' actual results, performance or achievements or the commercial bankingfinancial services industry or economy generally, to be materially different from future results, performance or achievements expressed or implied by such forward-looking statements.
All statements other than statements of historical fact are forward-looking statements. You can identify these forward-looking statements through Synovus' use of words such as “believes,” “anticipates,” “expects,” “may,” “will,” “assumes,” “predicts,” “could,” “should,” “would,” “intends,” “targets,” “estimates,” “projects,” “plans,” “potential” and other similar words and expressions of the future or otherwise regarding the outlook for Synovus' future business and financial performance and/or the performance of the commercial bankingfinancial services industry and economy in general. Forward-looking statements are based on the current beliefs and expectations of Synovus' management and are subject to significant risks and uncertainties. Actual results may differ materially from those contemplated by such forward-looking statements. A number of factors could cause actual results to differ materially from those contemplated by the forward-looking statements in this document. Many of these factors are beyond Synovus' ability to control or predict. These factors include, but are not limited to:
(1)the risk that competition in the financial services industry, including competition from nontraditional banking institutions such as Fintechs, may adversely affect our future earnings and growth;
(2)the risk that we may not realize the expected benefits fromrisks related to our efficiencystrategic implementation of new lines of business, new products and growth initiatives, which could negatively
affectservices, and new technologies and an expansion of our future profitability;
existing business opportunities with a renewed focus on innovation;
(3)our ability to attract and retain employees and the riskimpact of senior leadership transitions that are key to our current and future information technology system enhancements and initiatives may not be successfully implemented, which could negatively impact our operations;
strategic initiatives;
(4)the risk thatrisks related to our enterprise risk management framework may not identify or address risks adequately, which may result in unexpected losses;
strategic implementation of new lines of business, new products and services, and new technologies and an expansion of our existing business opportunities with a renewed focus on innovation;
(5)the risk that our allowance for loan losses may prove to be inadequate orwe may be negatively affected by credit risk exposures;
required to make substantial expenditures to keep pace with regulatory initiatives and the rapid technological changes in the financial services market;
(6)the risk that any future economic downturnprolonged periods of inflation could have a material adverse effect on our capital, financial condition, results of operationsbusiness, profitability and future growth;
our stock price;
(7)the impact of recent and proposed changes in governmental policy, laws and regulations, proposed and recently enacted changes in monetary policy and in the regulation and taxation of banks and financial institutions, or the interpretation or application thereof and the uncertainty of future implementation and enforcement of these regulations, including the risk of inflationary pressure and interest rate increases;
(8)changes in the interest rate environment, including changes to the federal funds rate, and competition in our primary market area may result in increased funding costs or reduced earning assets yields, thus reducing margins and net interest income;
(8)(9)the risk that a future economic downturn and contraction could have a material adverse effect on our ability to attractcapital, financial condition, credit quality, results of operations and retain key employees;
future growth, including the risk that the strength of the current economic environment could be weakened by the continued impact of COVID-19 and by current supply chain challenges and inflation;
(9)(10)the risk that weour current and future information technology system enhancements and operational initiatives may not be required to make substantial expenditures to keep pace with the rapid technological changes in the financial services market;
successfully implemented, which could negatively impact our operations;
(10)(11)risks related to our business relationships with, and reliance onupon, third parties tothat have strategic partnerships with us or that provide key components of our business infrastructure, including the costs of services and products provided to us by third parties, and risks related to disruptions in service or financial difficulties ofwith a third-party vendor;
vendor or business relationship;
(11)(12)the risk that our enterprise risk management framework, our compliance program, or our corporate governance and supervisory oversight functions may not identify or address risks adequately, which may result in unexpected losses;
(13)risks that our asset quality may deteriorate or that our allowance for credit losses may prove to be inadequate or may be negatively affected by credit risk exposures;

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(14)risks related to the ability of our operational framework to identify and manage risks associated with our business such as credit risk, compliance risk, reputational risk, and operational risk, including by virtue of our relationships with third-party business partners, as well as our relationship with third-party vendors and other service providers, which could, among other things, result in a breach of security systems as a result of cyber-attack or similar act;

providers;
(12)our ability to identify and address cyber-security risks such as data security breaches, malware, 'denial of service' attacks, 'hacking', and identity theft, a failure of which could disrupt our business and result in disclosure of and/or misuse or misappropriation of confidential or proprietary information; disruption or damage to our systems; increased costs; significant loses; or adverse effects to our reputation;
(15)
(13)the impact of recent and proposed changes in governmental policy, laws and regulations, including proposed and recently enacted changes in the regulation of banks and financial institutions, or the interpretation or application thereof and the uncertainty of future implementation and enforcement of these regulations;
(14)the risk that we could realize losses if we determine to sell non-performing assets and the proceeds we receive are lower than the carrying value of such assets;
(15)the risk that we may be exposed to potential losses in the event of fraud on cash accounts and/or theft;
theft, or in the event that a third-party vendor, obligor, or business partner fails to pay amounts due to us under that relationship or under any arrangement that we enter into with them;
(16)the risk that we may not be ableour ability to identify suitable acquisition targets and address cyber-security risks such as data security breaches, malware, "denial of service" attacks, "hacking" and identity theft, a failure of which could disrupt our business and result in the disclosure of and/or strategic partners as partmisuse or misappropriation of confidential or proprietary information, disruption or damage of our growth strategy and even if we are ablesystems, increased costs, significant losses, or adverse effects to identify suitable acquisition counterparties, we may not be able to complete such transactions on favorable terms, if at all, or successfully integrate acquired bank or nonbank operations into our existing operations;
reputation;
(17)the risk that we may not be ablerisks and uncertainties related to realize the anticipated benefits fromimpact of the continuing COVID-19 pandemic on our balance sheet restructuring actions;
assets, business, capital and liquidity, financial condition, prospects and results of operations;
(18)changes in the cost and availability of funding due to changes in the deposit market and credit market;
(19)the impact on our financial results, reputation, and business if we are unable to comply with all applicable federal and state regulations or other supervisory actions or directives and any necessary capital initiatives;
(19)(20)the risks that if economic conditions worsen further or regulatory capital rules are modified, or the results of mandated “stress testing” do not satisfy certain criteria, we may be required to undertake initiatives to improve or conserve our capital position;
(20)changes in the cost and availability of funding due to changes in the deposit market and credit market;
(21)
(21)restrictions or limitations on access to funds from historical and alternative sources of liquidity could adversely affect our overall liquidity, which could restrict our ability to make payments on our obligations and our ability to support asset growth and sustain our operations and the operations of Synovus Bank;
(22)our ability to receive dividends from our subsidiaries could affect our liquidity, including our ability to pay dividends or take other capital actions;
(23)risks related to our ESG strategies and initiatives, the scope and pace of which could alter our reputation and shareholder, employee, client and third-party relationships;
(24)risks related to the continued use, availability and reliability of LIBOR and the risks related to the transition from LIBOR to any alternate reference rate we may use;
(25)the risk that we may not be able to identify suitable bank and non-bank acquisition opportunities as part of our growth strategy and even if we are able to identify attractive acquisition opportunities, we may not be able to complete such transactions on favorable terms or realize the anticipated benefits from such acquisitions;
(26)the risk that we could realize losses if we sell non-performing assets and the proceeds we receive are lower than the carrying value of such assets;
(27)risks related to regulatory approval to take certain actions, including any dividends on our common stock or Series C Preferred Stock,preferred stock, any repurchases of common stock or any other issuance or redemption of any other regulatory capital instruments, as well as any applications in respect of expansionary initiatives;
instruments;
(24)(28)risks related to recent and proposed changes in the mortgage banking industry, including the risk that we may be requiredour concentrated operations in the Southeastern U.S. make us vulnerable to repurchase mortgage loans sold to third partieslocal economic conditions, local weather catastrophes, public health issues and the impact of the “ability to pay” and “qualified mortgage” rules on our loan origination process and foreclosure proceedings;
other external events;
(25)the risk that our current tax position, including the realization of our deferred tax assets in the future, could be subject to comprehensive tax reform;
(29)
(26)the risk that we could have an “ownership change” under Section 382 of the Code, which could impair our ability to timely and fully utilize our net operating losses and built-in losses that may exist when such “ownership change” occurs;
(27)the costs and effects of litigation, investigations inquiries or similar matters, or adverse facts and developments related thereto;
(28)(30)risks related to the fluctuation in our stock price;
price and general volatility in the stock market;
(29)(31)the effects of any damages to our reputation resulting from developments related to any of the items identified above; and
(30)(32)other factors and other information contained in this Report and in other reports and filings that we make with the SEC under the Exchange Act, including, without limitation, those found in "Risk"Part II - Item 1A. Risk Factors" of this Report.
For a discussion of these and other risks that may cause actual results to differ from expectations, refer to “Part I-ItemI - Item 1A. Risk Factors” and other information contained in Synovus' 20162021 Form 10-K and our other periodic filings, including quarterly reports on Form 10-Q and current reports on Form 8-K, that we file from time to time with the SEC. All written or oral forward-looking statements that are made by or are attributable to Synovus are expressly qualified by this cautionary notice. You should

not place undue reliance on any forward-looking statements since those statements speak only as of the date on which the statements are made. Synovus undertakes no obligation to update any forward-looking information and statements, whether written or oral,statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of new information or unanticipated events, except as may otherwise be required by law.
INTRODUCTION AND CORPORATE PROFILE
Synovus Financial Corp. is a financial services company and a registered bank holding company headquartered in Columbus, Georgia. Through its wholly-owned subsidiary, Synovus Bank, a Georgia state-chartered bank that is a member of the Federal Reserve System, the companyCompany provides commercial and retailconsumer banking in addition to a full suite of specialized

33


products and services including private banking, treasury management, wealth management, mortgage services, premium finance, asset-based lending, structured lending, and international banking. Synovus also provides mortgage services, financial planning and investment advisory services through its wholly-owned subsidiaries, Synovus Mortgage, Synovus Trust and Synovus Securities, as well as its GLOBALT and Creative Financial Group divisions.
Synovus Bank is positioned in some of the highest growth markets in the Southeast, with 249 branches and 328 ATMswith 272 branches in Alabama, Florida, Georgia, Alabama, South Carolina, Florida, and Tennessee.
The following financial review summarizes the significant trends, changes in our business, transactions, and other matters affecting Synovus’ results of operations for the nine and three months ended September 30, 2017March 31, 2022 and financial condition as of September 30, 2017March 31, 2022 and December 31, 2016.2021. This discussion supplements, and should be read in conjunction with, the unaudited interim consolidated financial statements and notes thereto contained elsewhere in this Report and the consolidated financial statements of Synovus, the notes thereto, and management’s discussion and analysis contained in Synovus’ 2016Synovus' 2021 Form 10-K.
Management's Discussion and Analysis of Financial Condition and Results of Operations consists of:
Ÿ•Discussion of Results of Operations - Reviews Synovus' financial performance, as well as selected balance sheet items,
items from the statements of income, significant transactions, and certain key ratios that illustrate Synovus' performance.


Ÿ•Credit Quality, Capital Resources and Liquidity - Discusses credit quality, market risk, capital resources, and liquidity,
as well as performance trends. It also includes a discussion of liquidity policies, how Synovus obtains funding, and related performance.
performance.

Ÿ•Additional Disclosures - Discusses additional important matters including critical accounting policies and
non-GAAP financial measures used within this Report.
A reading of each section is important to understand fully the nature of our financial performance.


34


DISCUSSION OF RESULTS OF OPERATIONS
Table 1 - Consolidated Financial Highlights
Three Months Ended March 31,
(dollars in thousands, except per share data)20222021Change
Net interest income$392,248 $373,857 5 %
Provision for (reversal of) credit losses11,400 (18,575)nm
Non-interest revenue105,334 110,956 (5)
Adjusted non-interest revenue(1)
106,629 112,154 (5)
Total TE revenue498,447 485,587 3 
Adjusted total revenue(1)
499,742 486,785 3 
Non-interest expense272,450 267,134 2 
Adjusted non-interest expense(1)
279,492 265,811 5 
Income before income taxes213,732 236,254 (10)
Net income171,037 187,093 (9)
Net income available to common shareholders162,746 178,802 (9)
Net income per common share, basic1.12 1.20 (7)
Net income per common share, diluted1.11 1.19 (7)
Adjusted net income per common share, diluted(1)
1.08 1.21 (11)
Net interest margin(2)
3.00 %3.04 %(4)  bps
Net charge-off ratio(2)
0.19 0.21 (2)
Return on average assets(2)
1.22 1.40 (18)
Adjusted return on average assets(1)(2)
1.19 1.41 (22)
Efficiency ratio-TE54.66 55.01 (35)
Adjusted tangible efficiency ratio(1)
55.50 54.12 138 
Consolidated Financial Highlights
 Nine Months Ended September 30, Three Months Ended September 30,
(dollars in thousands, except per share data)2017 2016 Change 2017 2016 Change
Net interest income$753,597
 665,650
 13.2 % $262,572
 226,007
 16.2 %
Provision for loan losses58,620
 21,741
 169.6 39,686
 5,671
 599.8
Non-interest income275,974
 199,188
 38.5 135,435
 68,155
 98.7
Adjusted non-interest income(1)
204,456
 199,589
 2.4 68,418
 68,345
 0.1
Total revenues (2)
1,030,750
 865,676
 19.1 406,246
 294,433
 38.0
Adjusted total revenues(1)
958,943
 866,203
 10.7 331,273
 294,682
 12.4
Non-interest expense594,780
 562,716
 5.7 205,646
 185,871
 10.6
Adjusted non-interest expense(1)
576,150
 545,495
 5.6 194,102
 183,907
 5.5
Income before income taxes376,171
 280,381
 34.2 152,675
 102,620
 48.8
Net income245,868
 178,233
 37.9 98,007
 65,245
 50.2
Net income available to common shareholders238,190
 170,555
 39.7 95,448
 62,686
 52.3
Net income per common share, basic1.96
 1.36
 43.4 0.79
 0.51
 54.8
Net income per common share, diluted1.94
 1.36
 43.2 0.78
 0.51
 54.5
Adjusted net income per common share, diluted(1)
1.82
 1.45
 25.9 0.65
 0.52
 24.7
Net interest margin(3)
3.52% 3.27% 25  bps 3.63% 3.27
 36  bps
Net charge-off ratio(3)
0.33
 0.12
 21  bps 0.62
 0.12
 50  bps
Adjusted net charge-off ratio(1)(3)
0.15
 0.12
 3  bps 0.06
 0.12
 (6) bps
Return on average assets(3)
1.07
 0.81
 26  bps 1.27
 0.88
 39  bps
Adjusted return on average assets(1)(3)
1.01
 0.87
 14  bps 1.05
 0.90
 15  bps
Efficiency ratio57.70
 65.00
 (730) bps 50.62
 63.13
 (1,251) bps
Adjusted efficiency ratio(1)
60.08
 62.98
 (290) bps 58.59
 62.41
 (382) bps
            
(1)    See “Non-GAAP"Table 14 - Reconciliation of Non-GAAP Financial Measures” in this Report for the applicable reconciliation to the most comparable GAAP measure.
(2)    ConsistsAnnualized
March 31, 2022December 31, 2021Sequential Quarter ChangeMarch 31, 2021Year-Over-Year Change
(dollars in thousands)
Loans, net of deferred fees and costs$40,169,150 $39,311,958 $857,192 $38,805,101 $1,364,049 
Total average loans39,350,761 38,365,598 985,163 38,212,267 1,138,494 
Total deposits48,656,244 49,427,276 (771,032)47,368,951 1,287,293 
Core deposits (excludes brokered deposits)46,618,560 46,592,276 26,284 44,174,284 2,444,276 
Core transaction deposits (excludes brokered and public fund deposits)38,285,649 37,880,650 404,999 34,804,575 3,481,074 
Total average deposits49,345,364 49,117,222 228,142 46,454,878 2,890,486 
Non-performing assets ratio0.40 %0.40 %—   bps0.50 %(10)bps
Non-performing loans ratio0.33 0.33 — 0.40 (7)
Past due loans over 90 days0.01 0.02 (1)0.01 — 
CET1 capital$4,485,661 $4,388,618 $97,043 $4,184,715 $300,946 
Tier 1 capital5,022,806 4,925,763 97,043 4,721,860 300,946 
Total risk-based capital5,936,543 5,827,196 109,347 5,733,956 202,587 
CET1 capital ratio9.49 %9.50 %(1)  bps9.74 %(25)bps
Tier 1 capital ratio10.63 10.66 (3)10.99 (36)
Total risk-based capital ratio12.56 12.61 (5)13.34 (78)
Total shareholders’ equity to total assets ratio8.55 9.24 (69)9.36 (81)
Tangible common equity ratio(1)
6.80 7.52 (72)7.55 (75)
Return on average common equity(2)
14.20 16.11 (191)15.77 (157)
Adjusted return on average common equity(1)(2)
13.82 16.64 (282)15.93 (211)
Adjusted return on average tangible common equity(1)(2)
15.59 18.72 (313)18.04 (245)
(1)    See "Table 14 - Reconciliation of net interest income and non-interest income excluding investment securities (losses) gains, net.
(3) Annualized
 September 30, 2017 June 30, 2017 Sequential Quarter Change September 30, 2016 Year-Over-Year Change 
(dollars in thousands, except per share data) 
Loans, net of deferred fees and costs$24,487,360
 24,430,512
 56,848
 23,262,887
 1,224,473 
Total deposits26,186,228
 25,218,816
 967,412
 24,192,003
 1,994,225 
Total average deposits25,286,919
 24,991,708
 295,211
 24,030,291
 1,256,628 
Average core deposits(1)
23,756,030
 23,612,149
 143,881
 22,620,552
 1,135,478 
Average core transaction deposits(1)
 
18,603,161
 18,409,170
 193,991
 17,362,060
 1,241,101 
           
Non-performing assets ratio0.57% 0.73
 (16) bps 0.77
 (20) bps 
Non-performing loans ratio0.40
 0.65
 (25) bps 0.64
 (24) bps 
Past due loans over 90 days0.02
 0.02
 —
 0.02
 —
 
           
Common equity Tier 1 capital (transitional)$2,749,304
 2,734,983
 14,321
 2,596,233
 153,071 
Tier 1 capital2,849,580
 2,829,340
 20,240
 2,620,379
 229,201 
Total risk-based capital3,362,127
 3,340,155
 21,972
 3,139,465
 222,662 
Common equity Tier 1 capital ratio transitional(2)
10.06% 10.02
 4  bps 9.96
 10  bps 
Tier 1 capital ratio(2)
10.43
 10.37
 6  bps 10.05
 38  bps 
Total risk-based capital ratio12.30
 12.24
 6  bps 12.04
 26  bps 
Total shareholders’ equity to total assets ratio9.47
 9.77
 (30) bps 9.78
 (31) bps 
Tangible common equity to tangible assets ratio(1)
8.88
 9.15
 (27) bps 9.28
 (40) bps 
Return on average common equity(3)
13.24
 10.34
 290  bps 8.89
 435  bps 
Adjusted return on average common equity(1)(3)
 
10.92
 10.49
 43  bps 9.08
 184  bps 
Adjusted return on average tangible common equity(1)(3)
11.19
 10.75
 44  bps 9.16
 203  bps 
           
(1) See “Non-GAAPNon-GAAP Financial Measures” in this Report for the applicable reconciliation to the most comparable GAAP measure.
(2)    June 30, 2017 ratios for CET1 transitional and Tier 1 capital were reported in error as 10.37% and 10.02%, respectively, on the June 30, 2017 Report.Quarter annualized
(3) Annualized


35


Results for the Nine and Three Months Ended September 30, 2017

Third quarter of 2017 results include the Cabela's Transaction Fee, partially offset by certain balance sheet restructuring actions which resulted in pre-tax charges totaling $44.5 million. The fourth quarter of 2017 results will include a pre-tax loss on early extinguishment of debt totaling approximately $24 million due to the previously announced redemption of our 7.875% senior notes due 2019 at a redemption premium on November 9, 2017.Executive Summary
For the nine months ended September 30, 2017, netNet income available to common shareholders for the first quarter of 2022 was $238.2$162.7 million, or $1.94$1.11 per diluted common share ($1.08 on an increase of 39.7% and 43.2%adjusted basis(1)), respectively, compared to $178.8 million, or $1.19 per diluted common share ($1.21 adjusted(1)), for the nine months ended September 30, 2016. Forfirst quarter of 2021. Provision for credit losses was $11.4 million for the first quarter of 2022, included net charge-offs of $18.6 million and also represented a slowing of allowance releases due primarily to the increased economic uncertainty present from inflation concerns and geopolitical tensions, compared to a reversal of $18.6 million for the first quarter of 2021.
Net interest income for the three months ended September 30, 2017, net income available to common shareholdersMarch 31, 2022 was $95.4$392.2 million, up $18.4 million, or $0.78 per diluted common share,5%, compared to the same period in 2021, including $6.9 million in PPP fees during 2022 and $24.9 million in 2021. Net interest margin was down 4 bps over the comparablethree-month period to 3.00%, due primarily to the $18.0 million decline in PPP fees. Net interest margin for the first quarter was up 4 bps compared to the fourth quarter of 2021 with lower cash balances helping support the margin and offset the impact of the continued decline in PPP fees.
Non-interest revenue for the first quarter of 2022 was $105.3 million, down $5.6 million, or 5%, compared to the first quarter of 2021, and on an adjusted basis(1) was $106.6 million, down $5.5 million, or 5%, from the first quarter of 2021, primarily due to lower mortgage banking income partially offset by higher core banking fees and higher wealth revenue(2).
Non-interest expense for the first quarter of 2022 was $272.5 million, up $5.3 million, or 2%, compared to the same period in 2021 while adjusted non-interest expense(1)of $279.5 million was up $13.7 million, or 5%. The increase in adjusted non-interest expense(1) during 2022 was primarily due to an increase in expense associated with incentives and elevated performance, resumption of 52.3%normal business activities post COVID-19, and 54.5%, respectively, comparedinvestments in new growth initiatives.
At March 31, 2022, loans, net of deferred fees and costs, of $40.17 billion, increased $857.2 million from December 31, 2021. Excluding a $196.7 million decline in PPP loans primarily from forgiveness, loans increased $1.05 billion, or 11% annualized, led by growth in C&I loans as commercial production and line utilization continue to drive growth.
At March 31, 2022, credit metrics remained stable and near historical lows with NPAs at 40 bps, NPLs at 33 bps, and total past dues at 11 bps, as a percentage of total loans. Net charge-offs remained low at $18.6 million, or 19 bps annualized, for the three months ended September 30, 2016. ForMarch 31, 2022. The ACL at March 31, 2022 totaled $462.3 million, a decrease of $7.2 million from December 31, 2021, and resulted primarily from continued positive trends in our credit performance and loan mix mostly offset by economic uncertainty which slowed the pace of the allowance decline this quarter. The ACL to loans coverage ratio at March 31, 2022 was 1.15%, 4 bps lower compared to December 31, 2021.
Total period-end deposits at March 31, 2022 decreased $771.0 million compared to December 31, 2021; however, core transaction deposits increased $405.0 million, or 4% annualized, compared to December 31, 2021 as a result of strong growth in our Consumer Banking segment as well as a focus on remixing the deposit base. Total deposit costs were 11 bps during the first quarter of 2022.
At March 31, 2022, Synovus' CET1 ratio was 9.49%, well in excess of regulatory requirements. Synovus announced on January 20, 2022 that its Board of Directors authorized share repurchases of up to $300 million in 2022 and approved an increase in the current common shareholder dividend by $0.01 to $0.34 per quarter, paid in April 2022. Through March 31, 2022, Synovus has repurchased $9.7 million, or 204 thousand shares of its common stock, at an average price of $47.48 per share.
On April 21, 2022, Synovus Bank announced that it signed a definitive agreement to strategically invest in a provider of a cloud-based platform that combines a payment gateway with robust merchant processing solutions, which allows merchants and independent software vendors (ISVs) to easily integrate payments into their software or websites. This proposed investment, resulting in a 60% ownership interest, will not be material to our consolidated financial statements but will become an integral part of Maast, our new money-as-a-service offering that we expect to launch later this year. The completion of the investment is subject to the satisfaction or waiver of customary closing conditions, including receipt of necessary regulatory approvals.
More detail on Synovus' financial results for the three months ended September 30, 2017, adjusted net income per common share, diluted was $0.65, up 24.7%March 31, 2022 may be found in subsequent sections of "Item 2. – Management's Discussion and Analysis of Financial Condition and Results of Operations" of this Report. See also "Part 1 – Item 1A. – Risk Factors" of Synovus' 2021 Form 10-K.






36


2022 Updated Guidance
Updated guidance for the full year 2022, compared to $0.52 for the third quarter2021, which incorporates our strategic objectives, and is based on our current view of 2016. For the three months ended September 30, 2017, returneconomic stability and growth in our footprint, includes:
•Period-end loan growth (excluding PPP) of 6% to 8%
•Adjusted total revenue(1) increase of 9% to 11%(3)
•Adjusted non-interest expense(1) increase of 3% to 6%
•Effective income tax rate of 21% to 23%
•CET1 ratio target range of 9.25% to 9.75%
•Synovus Forward on average assets was 1.27%, annualized, up 39 basis points from the third quartertrack to achieve $175 million pre-tax run-rate by year-end
(1) See "Table 14 - Reconciliation of 2016 (adjusted return on average assets was 1.05%, annualized, up 15 basis points from the third quarter of 2016). See "Non-GAAPNon-GAAP Financial Measures"Measures” in this Report for the applicable reconciliation to the most comparable GAAP measure.
Total revenues(2) Consists of $1.0 billion for the nine months ended September 30, 2017 were up 19.1% compared to the nine months ended September 30, 2016. Adjusted total revenues,fiduciary and asset management, brokerage, and insurance revenue.
(3) Uses forward rate curve at March 31, 2022 which excludes the Cabela's Transaction Fee, net investment securities (losses) gains, net, and decrease in fair value of private equity investments, net, of $958.9 million for the nine months ended September 30, 2017 were up 10.7% compared to the nine months ended September 30, 2016. Total revenues of $406.2 million for the three months ended September 30, 2017 were up 38.0% compared to the three months ended September 30, 2016. Adjusted total revenues of $331.3 million for the three months ended September 30, 2017 were up 12.4% compared to the same time period in 2016 driven by net interest income growth of 16.2% from the prior year. Net interest income was $262.6 million for the three months ended September 30, 2017, up $36.6 million, or 16.2%, compared to the three months ended September 30, 2016. The net interest margin was 3.63% for the three months ended September 30, 2017, an increase of 12 basis points from the second quarter of 2017 and 36 basis points from 3.27% for the third quarter of 2016. The yield on earning assets was 4.11%, up 12 basis points from the second quarter of 2017 and up 40 basis points compared to the third quarter of 2016, and the effective cost of funds was 0.48%, unchanged from second quarter of 2017 and up four basis points from third quarter of 2016. The yield on loans was 4.49%, an increase of 13 basis points sequentially and 35 basis points from the third quarter of 2016. Earning asset yields also benefited from a reduction of the average balance of lower yielding funds heldassumes Fed Funds end 2022 at the Federal Reserve. See "Non-GAAP Financial Measures" in this Report for the applicable reconciliation to the most comparable GAAP measure.approximately 2.5%.
Non-interest income for the nine and three months ended September 30, 2017 was $276.0 million and $135.4 million, respectively, up $76.8 million, or 38.5%, and up $67.3 million, or 98.7%, compared to the nine and three months ended September 30, 2016, respectively. Adjusted non-interest income, which excludes the Cabela's Transaction Fee, net investment securities (losses) gains, net, and decrease in fair value of private equity investments, net was up $4.9 million, or 2.4%, and flat, for the nine and three months ended September 30, 2017, compared to the same periods a year ago, respectively. See "Non-GAAP Financial Measures" in this Report for the applicable reconciliation to the most comparable GAAP measure.
Non-interest expense for the nine and three months ended September 30, 2017 was $594.8 million and $205.6 million, respectively, compared to $562.7 million and $185.9 million for the nine and three months ended September 30, 2016, respectively. Adjusted non-interest expense for the nine and three months ended September 30, 2017, which excludes the third quarter of 2017 balance sheet restructuring actions of impairments on ORE and other properties held for sale, restructuring charges, net, loss on early extinguishment of debt, net, litigation contingency/settlement expense, merger-related expense, fair value adjustment to Visa derivative, amortization of intangibles, and certain earnout liability adjustments, increased $30.7 million, or 5.6%, and $10.2 million, or 5.5%, compared to the same periods in 2016, respectively. Synovus continues to generate positive operating leverage with the year-over-year expense growth primarily driven by strategic investments in talent and technology, higher third-party processing expense relating to third-party lending partnerships servicing fees, the addition of Global One, and expenses associated with Synovus Bank's transition to a single bank operating environment and single brand. Strategic investments in talent and technology accounted for approximately $15 million and $5 million of the increase for the nine and three months ended September 30, 2017, respectively, compared to the same periods in 2016, as Synovus continues to add key talent and invest in technology to enhance the customer experience. Third-party processing expense relating to the servicing fees of third-party lending partnerships increased by $3.4 million and $1.2 million for the nine and three months ended September 30, 2017, respectively, compared to the same periods in 2016, and Global One operating expenses accounted for $3.0 million and $1.2 million of the increase compared to the nine and three months ended September 30, 2016, respectively. Expenses associated with Synovus Bank's transition to a single bank operating environment and single brand resulted in higher expenses of $4.0 million and $1.1 million compared to the nine and three months ended September 30, 2016, respectively. See "Non-GAAP Financial Measures" in this Report for the applicable reconciliation to the most comparable GAAP measure.


During the third quarter of 2017, Synovus completed certain balance sheet restructuring actions which included $77.8 million in loans transferred to held-for-sale (consisting primarily of NPLs) that resulted in charge-offs of $34.2 million and provision expense of $27.7 million. Additionally, foreclosed real estate expenses for the quarter included $7.1 million of charges related to discounts to fair value for completed or planned accelerated dispositions. Non-performing loans were $97.8 million at September 30, 2017, down $61.5 million from June 30, 2017 and down $50.3 million from September 30, 2016. The non-performing loan ratio was 0.40% at September 30, 2017, as compared to 0.65% at June 30, 2017 and 0.64% at September 30, 2016. Total non-performing assets were $138.6 million at September 30, 2017, down $40.3 million from June 30, 2017 and down $40.5 million from September 30, 2016. The non-performing assets ratio was 0.57% at September 30, 2017, as compared to 0.73% in the prior quarter, and 0.77% a year ago. Net charge-offs for the nine months ended September 30, 2017 were $60.7 million, or 0.33% as a percentage of average loans annualized, compared to $20.4 million, or 0.12% as a percentage of average loans annualized, for the nine months ended September 30, 2016. Excluding the third quarter of 2017 balance sheet restructuring actions, the adjusted net charge-off ratio for the nine months ended September 30, 2017 was 0.15%. Total delinquencies (consisting of loans 30 or more days past due and still accruing) were 0.35% of total loans at September 30, 2017 as compared to 0.27% at June 30, 2017 and 0.27% at September 30, 2016. The allowance for loan losses at September 30, 2017 was $249.7 million, or 1.02% of total loans, compared to $251.8 million, or 1.06% of total loans, at December 31, 2016 and $253.8 million, or 1.09% of total loans, at September 30, 2016. See "Non-GAAP Financial Measures" in this Report for the applicable reconciliation to the most comparable GAAP measure.37
Restructuring charges of $7.0 million were recorded during the nine months ended September 30, 2017 consisting primarily of severance charges of $6.4 million recorded during the first quarter of 2017 associated primarily with termination benefits incurred in conjunction with a voluntary early retirement program offered during the quarter. This program was part of Synovus' ongoing efficiency initiatives. Additionally, during the three months ended September 30, 2017, Synovus recorded restructuring charges of $519 thousand due to additional asset impairment charges of $515 thousand on properties previously identified for disposition. During the nine months ended September 30, 2016, Synovus recorded restructuring charges of $8.2 million consisting primarily of asset impairment charges related to corporate real estate optimization activities and branch closures.
At September 30, 2017, total loans were $24.49 billion, an increase of $631.0 million, or 3.5% annualized, and $1.22 billion or 5.3%, compared to December 31, 2016 and September 30, 2016, respectively. Year-over-year loan growth was driven by a $750.1 million or 15.6% increase in consumer loans and a $718.1 million or 6.5% increase in C&I loans, partially offset by a $245.6 million or 3.3% decline in CRE loans.
During the third quarter of 2017, total average deposits increased $295.2 million, or 4.7% annualized, compared to the second quarter of 2017, and increased $1.26 billion, or 5.2%, compared to the third quarter of 2016. Excluding the acquired WFB brokered time deposits, average deposits for the third quarter of 2017 increased $223.3 million, or 3.5% annualized, compared to the second quarter of 2017. Average core transaction deposits increased $194.0 million, or 4.2% annualized, compared to the prior quarter, and were up $1.24 billion, or 7.1%, compared to the third quarter of 2016. The increase in average deposits for the three months ended September 30, 2017 compared to the three months ended September 30, 2016 was due to growth in average core transaction deposits, which represented 73.6% of average deposits for the third quarter of 2017 compared to 72.3% a year ago. See “Non-GAAP Financial Measures” in this Report for the applicable reconciliation to the most comparable GAAP measure.

During January 2016, Synovus repurchased $124.7 million of its subordinated notes that matured on June 15, 2017 in conjunction with Synovus' cash tender offer that commenced on December 23, 2015 and expired on January 22, 2016. Results for the nine months ended September 30, 2016 included a $4.7 million pre-tax loss relating to this tender offer.
On September 25, 2017, Synovus issued a notice of redemption to redeem all of the $300.0 million aggregate principal amount of its outstanding 7.875% senior notes due 2019 on November 9, 2017 at a “make whole” premium, plus accrued but unpaid interest on the 2019 notes to the redemption date.  The results for the three months ending December 31, 2017 will include a pre-tax loss of approximately $24 million related to early extinguishment of these notes.
During the nine months ended September 30, 2017, Synovus repurchased $135.9 million in common stock under the current share repurchase program, which authorizes repurchases of up to $200 million of the Company's common stock to be executed during 2017. Additionally, during the first quarter of 2017, Synovus increased the quarterly common stock dividend by 25% to $0.15 per share effective with the quarterly dividend declared during the first quarter of 2017. Total shareholders' equity was $3.00 billion at September 30, 2017, compared to $2.93 billion at December 31, 2016, and $2.91 billion at September 30, 2016. Return on average common equity was 13.24%, annualized, for the three months ended September 30, 2017, compared to 10.34%, annualized, for the three months ended June 30, 2017, and 8.89%, annualized, for the three months ended September 30, 2016. Adjusted return on average common equity was 10.92%, annualized, for the three months ended September 30, 2017, compared to 10.49%, annualized, for the three months ended June 30, 2017, and 9.08%, annualized, for the three months ended September 30, 2016. Adjusted return on average tangible common equity was 11.19%, annualized, for the three months ended September 30, 2017, compared to 10.75%, annualized, for the three months ended June 30, 2017, and 9.16%, annualized, for the three months ended September 30, 2016. See "Non-GAAP Financial Measures" in this Report for the applicable reconciliation to the most comparable GAAP measure.

2017 Outlook
For 2017, excluding the impact from the Cabela's Transaction Fee and balance sheet restructuring actions recognized during the third quarter of 2017, management currently expects:
Average loan growth of 5% to 7%
Average total deposits growth of 5% to 7%
Net interest income growth of 12% to 14%
Adjusted non-interest income* growth of 2% to 4%
Adjusted total non-interest expense* growth of 2% to 4%
Effective income tax rate of 34% to 35%
Adjusted net charge-off ratio* of 15 to 20 bps
* See “Non-GAAP Financial Measures” in this Report for the applicable reconciliation to the most comparable GAAP measure.
Changes in Financial Condition
During the ninethree months ended September 30, 2017,March 31, 2022, total assets decreased $897.7 million to $56.42 billion. Liquidity levels declined as cash and cash equivalents decreased $1.46 billion, and total loans increased $1.54 billion$857.2 million, led by growth in C&I loans as commercial production and line utilization continue to drive growth. Investment securities available for sale decreased $455.2 million as gross unrealized losses in this portfolio increased, resulting from $30.10 billionthe increase in market interest rates in the first quarter of 2022. The loan to deposit ratio was 82.6% at March 31, 2022, higher as compared to 79.5% at December 31, 20162021, and 81.9% at March 31, 2021.
Total shareholders' equity at March 31, 2022 decreased $472.2 million compared to $31.64 billion. The principal componentsDecember 31, 2021 and included net income of this increase were an increase in loans, net$171.0 million, offset by dividends declared on common and preferred stock of deferred fees and costs, of $631.0$49.4 million and an increase$8.3 million, respectively, net changes in interest bearing funds with the Federal Reserve of $770.5 million. Additionally,unrealized losses on investment securities available for sale at fair value, increased by $107.2and cash flow hedges of $474.5 million and Synovus increased its investment in BOLI policies by $150.0$105.3 million, during the nine months ended September 30, 2017. An increaserespectively, and share repurchases of $1.54 billion in deposits, which includes the $1.10 billion in brokered time deposits acquired from WFB in the Cabela's Transaction, provided the primary funding source for the growth in assets. Long-term debt declined by $278.3 million during the nine months ended September 30, 2017 with Synovus' payoff of $278.6 million of subordinated notes at their maturity date of June 15, 2017. Other liabilities, at September 30, 2017, included $193.3 million accrued for purchases of investment securities available for sale settled during October, 2017.$9.7 million.
Loans
The following table compares the composition of the loan portfolio at September 30, 2017,March 31, 2022, December 31, 2016,2021, and September 30, 2016.March 31, 2021.
(dollars in thousands)September 30, 2017 December 31, 2016 
September 30, 2017 vs.
December 31, 2016 % Change(1)
 September 30, 2016 
September 30, 2017 vs.
September 30, 2016
% Change
Investment properties$5,925,096
 5,869,261
 1.3 % 5,898,631
 0.4 %
1-4 family properties794,616
 887,307
 (14.0) 921,688
 (13.8)
Land and development507,212
 616,297
 (23.7) 652,232
 (22.2)
  Total commercial real estate7,226,924
 7,372,865
 (2.6) 7,472,551
 (3.3)
Commercial, financial and agricultural6,961,709
 6,909,036
 1.0
 6,537,656
 6.5
Owner-occupied4,765,433
 4,636,016
 3.7
 4,471,365
 6.6
Total commercial and industrial11,727,142
 11,545,052
 2.1
 11,009,021
 6.5
Home equity lines1,528,889
 1,617,265
 (7.3) 1,638,844
 (6.7)
Consumer mortgages2,557,680
 2,296,604
 15.2
 2,243,154
 14.0
Credit cards225,725
 232,413
 (3.8) 232,309
 (2.8)
Other consumer loans1,245,278
 818,183
 69.8
 693,204
 79.6
Total consumer5,557,572
 4,964,465
 16.0
 4,807,511
 15.6
Total loans24,511,638
 23,882,382
 3.5
 23,289,083
 5.2
Deferred fees and costs, net(24,278) (25,991) (8.8) (26,196) (7.3)
Total loans, net of deferred fees and costs$24,487,360
 23,856,391
 3.5 % 23,262,887
 5.3 %
          
(1) Percentage changes are annualized


Table 2 - Loans by Portfolio Class
March 31, 2022 vs. December 31, 2021 ChangeMarch 31, 2022 vs. March 31, 2021 Change
(dollars in thousands)March 31, 2022December 31, 2021March 31, 2021
Commercial, financial and agricultural$12,659,611 31.5 %$12,147,858 30.9 %$511,753 4 %$12,748,106 32.9 %$(88,495)(1)%
Owner-occupied7,692,714 19.2 7,475,066 19.0 217,648 3 7,031,505 18.1 661,209 9 
Total commercial and industrial20,352,325 50.7 19,622,924 49.9 729,401 4 19,779,611 51.0 572,714 3 
Investment properties10,047,145 25.0 9,902,776 25.2 144,369 1 9,335,725 24.1 711,420 8 
1-4 family properties620,674 1.5 645,469 1.6 (24,795)(4)638,954 1.6 (18,280)(3)
Land and development477,499 1.2 466,866 1.2 10,633 2 559,249 1.4 (81,750)(15)
Total commercial real estate11,145,318 27.7 11,015,111 28.0 130,207 1 10,533,928 27.1 611,390 6 
Consumer mortgages5,052,003 12.6 5,068,998 12.9 (16,995)— 5,299,130 13.6 (247,127)(5)
Home equity1,416,341 3.5 1,361,419 3.5 54,922 4��1,460,866 3.8 (44,525)(3)
Credit cards188,247 0.5 204,172 0.5 (15,925)(8)181,594 0.5 6,653 4 
Other consumer loans2,014,916 5.0 2,039,334 5.2 (24,418)(1)1,549,972 4.0 464,944 30 
Total consumer8,671,507 21.6 8,673,923 22.1 (2,416)— 8,491,562 21.9 179,945 2 
Loans, net of deferred fees and costs$40,169,150 100.0 %$39,311,958 100.0 %$857,192 2 %$38,805,101 100.0 %$1,364,049 4 %
At September 30, 2017, totalMarch 31, 2022, loans, were $24.49net of deferred fees and costs, of $40.17 billion, an increase of $631.0increased $857.2 million, or 3.5% annualized, and $1.222%, from December 31, 2021. Excluding a $196.7 million decline in PPP loans primarily from forgiveness, loans increased $1.05 billion, or 5.3%,11% annualized, led by growth in C&I loans as commercial production and line utilization continue to drive growth. As a result of the strong loan growth and increased utilization we saw this quarter, as well as current pipeline levels, we expect loan growth of 6% to 8% for 2022 compared to December 31, 20162021, excluding PPP loans.
C&I loans remain the largest component of our loan portfolio, representing 50.7% of total loans, while CRE and September 30, 2016,consumer loans represent 27.7% and 21.6%, respectively. Year-over-yearOur portfolio composition is established through a comprehensive concentration management policy which sets limits for C&I, CRE, and consumer loan growthlevels as well as for sub-categories therein.
U.S. Small Business Administration Paycheck Protection Program (PPP)
Synovus participated in the PPP, which is a loan program that originated from the CARES Act. The total balance of all PPP loans was driven by a $718.1$202.9 million as of March 31, 2022, down $196.7 million, or 6.5% increase49%, compared to $399.6 million as of December 31, 2021, primarily due to $197 million in C&I loansforgiveness. The table below provides additional information on PPP loans.


38


Table 3 - PPP loans
March 31, 2022
PPP Loan Balances
(in millions, except count data )Fundings1Q22 ForgivenessTotal Life-to-Date Forgiveness
End of Period, Net of Unearned Fees and Costs(1)
Phase 1- 2020 Originations$2,886 $15 $2,739 $26 
Phase 2- 2021 Originations1,047 182 863 177
Total$3,933 $197 $3,602 $203 
(1) Equals fundings less forgiveness, pay-downs/pay-offs, and a $750.1 million or 15.6% increase in consumer loans, partially offset by a $245.6 million or 3.3% decline in CRE loans.unearned net fees.
(dollars in millions)Total Net FeesPercent of Fundings1Q22 Recognized Net FeesTotal Recognized Net FeesTotal Unrecognized or Remaining Net FeesContractual Maturity
Phase 1- 2020 Originations$94.9 3.3 %$0.2 $94.8 $0.1 2 years
Phase 2- 2021 Originations43.6 4.2 6.7 37.3 6.3 5 years
Total$138.5 3.5 %$6.9 $132.1 $6.4 
Commercial Loans
Total commercial loans (which are comprised of C&I and CRE loans) at September 30, 2017March 31, 2022 were $18.95$31.50 billion,, or 77.4%78.4%, of the total loan portfolio, compared to $18.92$30.64 billion,, or 79.3%77.9%, at December 31, 2016 and $18.48 billion, or 79.4%, at September 30, 2016.
At September 30, 2017 and December 31, 2016, Synovus had 26 and 29 commercial loan relationships, respectively, with total commitments of $50 million or more (including amounts funded). The average funded balance of these relationships at both September 30, 2017 and December 31, 2016 was approximately $33 million and $34 million, respectively.2021.
Commercial and Industrial Loans
The C&I loan portfolio represents the largest category of Synovus' total loan portfolio and is currently concentrated on small toprimarily comprised of general middle market C&I lending dispersed throughoutand commercial banking clients across a diverse groupwide range of industries primarily in the Southeast and other selected areas in the United States.industries. The following table shows the composition of the C&I loan portfolio aggregated by NAICS code. The portfolio is relationship focused and, as a result, Synovus' lenders have in-depth knowledge of the borrowers, most of which have guaranty arrangements. C&I loans are originated through Synovus' local market banking divisions and the Corporate Banking Group to commercial customers primarily to finance capital expenditures, including real property, plant and equipment, or as a source of working capital. In accordance with Synovus' lending policy, each loan undergoes a detailed underwriting process which incorporates uniform underwriting standards and oversight in proportion to the size and complexity of the lending relationship. As of September 30, 2017, approximately 93%March 31, 2022, 92.8% (93.7% excluding PPP loans) of Synovus' C&I loans are secured by real estate, business equipment, inventory, and other types of collateral.collateral compared to 92.2% (94.1% excluding PPP loans) as of December 31, 2021. C&I loans of $11.73 billion, representing 47.9% of the total loan portfolio,at March 31, 2022 grew $182.0$729.4 million, or 2.1% annualized,4%, from December 31, 20162021, as broad based growth mostly within the Wholesale Banking segment was partially offset by a $196.7 million decline in PPP loan balances. The growth largely consisted of funded loan production and $718.1 million, or 6.5%, from September 30, 2016. The year-over-year growthincreased line utilization particularly in C&I loans reflects $356.7 million in loans added from the Global One acquisition on October 1, 2016.finance and insurance, healthcare and social assistance, and wholesale trade industries.

39


Commercial and Industrial Loans by IndustrySeptember 30, 2017 December 31, 2016
(dollars in thousands)Amount 
%(1)
 Amount 
%(1)
Health care and social assistance$2,709,369
 23.1% $2,598,438
 22.5%
Manufacturing932,355
 8.0
 872,559
 7.6
Retail trade844,068
 7.2
 876,951
 7.6
Real estate and rental and leasing817,497
 7.0
 764,296
 6.6
Other services785,735
 6.7
 816,846
 7.1
Finance and insurance733,843
 6.3
 764,811
 6.6
Professional, scientific, and technical services704,515
 6.0
 719,056
 6.2
Wholesale trade719,717
 6.0
 645,124
 5.6
Real estate other582,041
 5.0
 561,133
 4.9
Accommodation and food services538,749
 4.6
 530,232
 4.6
Construction455,816
 3.9
 465,632
 4.0
Transportation and warehousing407,663
 3.5
 385,350
 3.3
Agriculture, forestry, fishing, and hunting363,640
 3.1
 387,589
 3.4
Administration, support, waste management, and remediation268,458
 2.3
 287,391
 2.5
Educational services231,003
 2.0
 222,516
 1.9
Information212,829
 1.8
 240,437
 2.1
Other industries419,844
 3.5
 406,691
 3.5
Total commercial and industrial loans$11,727,142
 100.0% $11,545,052
 100.0%
        
Table 4 - Commercial and Industrial Loans by Industry
 March 31, 2022December 31, 2021
(dollars in thousands)NAICS CodeAmount
%(1)
Amount
%(1)
Health care and social assistance62 $4,358,171 21.4 %$4,220,579 21.5 %
Finance and insurance52 2,860,331 14.1 2,520,480 12.8 
Manufacturing31-331,325,930 6.5 1,314,212 6.7 
Accommodation and food services72 1,281,743 6.3 1,231,801 6.3 
Wholesale trade42 1,242,145 6.1 1,146,505 5.8 
Retail trade44-451,198,595 5.9 1,195,456 6.1 
Real estate and rental and leasing5311 1,065,085 5.2 1,061,921 5.4 
Construction23 1,050,969 5.2 1,023,540 5.2 
Professional, scientific, and technical services54 993,246 4.9 928,436 4.7 
Other services81 944,285 4.6 1,004,448 5.1 
Transportation and warehousing48-49888,468 4.4 852,969 4.3 
Real estate other53 731,126 3.6 752,997 3.8 
Arts, entertainment, and recreation71 504,751 2.5 534,597 2.7 
Educational services61 425,904 2.1 427,456 2.2 
Public administration92 424,165 2.1 407,451 2.1 
Administration, support, waste management, and remediation56 265,235 1.3 246,638 1.3 
Agriculture, forestry, fishing, and hunting11 261,385 1.3 285,372 1.5 
Information51 177,903 0.9 189,306 1.0 
Other industries(2)352,889 1.6 278,760 1.5 
Total commercial and industrial loans$20,352,326 100.0 %$19,622,924 100.0 %
(1) Loan balance in each category expressed as a percentage of total C&I loans.
(2) Comprised of NAICS industries that are less than 2% of total C&I loans.
At September 30, 2017, $6.96March 31, 2022, $12.66 billion of C&I loans, or 28.4%31.5% of the total loan portfolio (including PPP loans of $202.9 million net of unearned fees and costs), represented loans originated for the purpose of financing commercial, financial and agricultural business activities. The primary source of repayment on these loans is revenue generated from products or services offered by the business or organization. The secondary source of repayment is the collateral, which consists primarily of equipment, inventory, accounts receivable, time deposits, cash surrender value of life insurance, and other business assets.

At September 30, 2017, $4.77March 31, 2022, $7.69 billion of C&I loans, or 19.5%19.2% of the total loan portfolio, represented loans originated for the purpose of financing owner-occupied properties. The primary sourcefinancing of repaymentowner-occupied facilities is considered a C&I loan even though there is improved real estate as collateral. This treatment is a result of the credit decision process, which focuses on these loans is revenue generatedcash flow from products or services offered byoperations of the business or organization.to repay the debt. The secondary source of repayment on these loans is the underlying real estate. These loans are predominately secured by owner-occupied properties and other real estate, and to a lesser extent, other types of collateral.
Commercial Real Estate Loans
Total CRE loans consist primarily of income-producing investment properties loans. Additionally, CRE loans include 1-4 family properties loans as well as land and development loans. These loans are subject to the same uniform lending policies referenced above.Total CRE loans of $7.23$11.15 billion representing 29.5% of the total loan portfolio, decreased $145.9increased $130.2 million or 2.6% annualized, from December 31, 2016 and decreased $245.6 million, or 3.3%,2021 as growth from September 30, 2016. The decline from a year ago was driven by strategic reductions in 1-4 family properties and land and development loans and a $15.7 million reduction from sales and transfers to held for sale during the third quarter of 2017.  This decline was partially offset by growth in investment properties.funded loan production outpaced payoff activity.
Investment Properties Loans
Investment properties loans consist of construction and mortgage loans for income producingincome-producing properties and are primarily made to finance multi-family properties, hotels, office buildings, shopping centers, warehouses and other investment property.commercial development properties. Total investment properties loans as of September 30, 2017March 31, 2022 were $5.93$10.05 billion,, or 82.0%90.1% of the total CRE loan portfolio, and 24.2% of the total loan portfolio, compared to $5.87 billion, or 79.6% of the total CRE portfolio and 24.6% of the total loan portfolio atincreased $144.4 million from December 31, 2016, an increase2021 primarily due to growth in all sub-categories with the exception of $55.8shopping centers, which were down $154.7 million, or 1.3% annualized. The net growth since year-end reflects an $84.0 million or 15.0% annualized growth in hotel loans, a $68.2 million or 5.8% annualized growth rate in multi-family loans, partially offset by a $124.0 million or 17.2% annualized decline in the shopping center portfolio. Synovus' investment properties portfolio is well diversified by property type, geography (primarily within Synovus' primary market areas of Georgia, Alabama, Tennessee, South Carolina, and Florida)9%, and tenants. The investment properties loans are primarily secured by the property being financed by the loans; however, these loans may also be secured by real estate or other assets beyond the property being financed.from December 31, 2021.
1-4 Family Properties Loans
1-4 family properties loans include construction loans to homebuildershome builders and commercial mortgage loans related to real estate investors1-4 family rental properties and are almost always secured by the underlying property being financed by such loans. These properties are primarily located in the markets served by Synovus. Construction loans are generally interest-only loans and typically have maturities of three years or less, and commercial mortgage loans generally have maturities of three to five years, with amortization periods of up to fifteen to twenty years. At September 30, 2017,March 31, 2022, 1-4 family properties loans totaled $794.6$620.7 million,, or 11.0%5.6% of the total CRE loan portfolio, and 3.2% of the total loan portfolio, compared to $887.3 million, or 12.0% of the total CRE portfolio and 3.7% of the total loan portfolio atdecreased slightly from December 31, 2016.2021.

40


Land and Development Loans
Land and development loans include commercial and residential development as well as land acquisition loans and are secured by land held for future development, typically in excess of one year. These loans have short-term maturities and are typically unamortized. Properties securing these loans are substantially within themarkets served by Synovus, footprint, and loan terms generally include personal guarantees from the principals. Loans in this portfolio are underwritten based on the loan to valueLTV of the collateral and the capacity of the guarantor(s). Total landLand and development loans were $507.2of $477.5 million at September 30, 2017, or 2.1% of the total loan portfolio, a decline of $109.1 million, or 23.7% annualized,March 31, 2022 increased marginally from December 31, 2016. Synovus continues to strategically reduce its exposure to these types of loans.2021.
Consumer Loans
The consumer loan portfolio consists of a wide variety of loan products offered through Synovus' banking network as well as third-party lending partnerships, including first and second residential mortgages, home equity lines,and consumer credit card loans, home improvement loans, student loans, and other consumer loans. The majority of Synovus' consumer loans are consumer mortgages and home equity lines secured by first and second liens on residential real estate primarily located in the markets served by Synovus.
Consumer loans at September 30, 2017 totaled $5.56 billion, representing 22.6% of the total loan portfolio compared to $4.96 billion, or 20.7% of the total loan portfolio at December 31, 2016, and $4.81 billion, or 20.6% of the total loan portfolio at September 30, 2016. Consumer loans increased $593.1 million, or 16.0% annualized, from December 31, 2016 and $750.1 million, or 15.6%, from September 30, 2016. Consumer mortgages grew $261.1 million or 15.2% annualized, from December 31, 2016, and $314.5 million, or 14.0%, from September 30, 2016 primarily due to continued recruiting of mortgage loan originators in strategic markets throughout the footprint as well as enhanced origination efforts, which also create additional cross-selling opportunities for other products. Credit cardboth secured and unsecured loans totaled $225.7 million at September 30, 2017, including $59.1 million of commercial credit card loans. The commercial credit card loans relate to Synovus' commercial customers who utilize corporate credit cards for various business activities. Other consumer loans increased $427.1 million, or 69.8% annualized, from December

31, 2016, and $552.1 million, or 79.6%, from September 30, 2016 due to two consumer-based lending partnerships. One lending partnership, which began in the third quarter of 2015, is a program that provides merchants and contractors nationwide with the ability to offer term financing to their customers for major purchases and home improvement projects. The other lending partnership, which began in the second quarter of 2016, primarily provides qualified borrowers the ability to refinance student loan debt.third-party lending. As of September 30, 2017, these partnerships had combined balances of $915.2 million, or 3.7% of the total loan portfolio.
Consumer loans are subject to uniform lending policies and consist primarily of loans with strong borrower credit scores. Synovus makes consumer lending decisions based upon a number of key credit risk determinants including FICO scores as well as loan-to-value and debt-to-income ratios. Risk levels 1-6 (descending) are assigned to consumer loans based upon a risk score matrix. At least annually, the consumer loan portfolio data is sent to a consumer credit reporting agency for a refresh of customers' credit scores so that management can evaluate ongoing consistency or negative migration in the quality of the portfolio, which impacts the allowance for loan losses. The most recent credit score refresh was completed as of June 30, 2017. Revolving lines of credit are regularly reviewed for any material change in financial circumstances, and when appropriate, the line of credit may be suspended for further advances. FICO scores within the residential real estate portfolio have generally remained stable over the last several years.
At June 30, 2017,March 31, 2022, weighted-average FICO scores within the residential real estate portfolio based on committed balances were 761 for HELOCs and 770775 for consumer mortgages.Conservative debt-to-income ratios (average HELOC debt and 791 for home equity, consistent with year-end 2021 scores.
Consumer loans at March 31, 2022 of $8.67 billion decreased $2.4 million compared to income ratio of loans originated) were maintained in both the third quarter and second quarter of 2017 at 32.3%. HELOC utilization rates (total amount outstanding as a percentage of total available lines) were 55.9% and 58.3% atSeptember 30, 2017 and December 31, 2016, respectively. Additionally, we maintained loan-to-value ratios based upon prudent guidelines2021. Home equity grew $54.9 million largely due to ensure consistency with Synovus' overall risk philosophy. At September 30, 2017, 36% ofincreased demand for home equity line balances were secured by a first lien,products as property values have been increasing, and 64% were secured by a second lien. Apart from credit card loans and unsecured loans, Synovus does not originate loans with LTV ratios greater than 100% at origination exceptinterest rates for infrequent situations provided that certain underwriting requirements are met. Additionally, at origination, loan maturities are determined based on the borrower's ability to repay (cash flow or earning power that represents the primary source of repayment) and the collateralization of the loan, including the economic life of the asset being pledged. Collateral securing these loans provides a secondary source of repayment in that the collateral may be liquidated. Synovus determines the need for collateral on a case-by-case basis. Factors considered include the purpose of the loan, current and prospective credit-worthiness of the customer, terms of the loan, and economic conditions.
Higher-riskhome equity products have remained relatively low. Other consumer loans, as definedwhich primarily includes third-party lending, decreased $24.4 million from December 31, 2021, driven by the FDIC are consumerthird-party lending loans (excluding consumer loans defined as nontraditional mortgage loans) where, aspayment activity that more than offset purchases of the origination date or, if the loan has been refinanced, as of the refinance date, the probability of default within two years is greater than 20%, as determined using a defined historical stress period. These loans are not a part of Synovus' consumer lending strategy, and Synovus does not currently offer specific higher-risk consumer loans, alt-A, no documentation or stated income residential real estate loan products. Synovus estimates that, as of September 30, 2017, it had $87.0 million of higher-risk consumer loans (1.6% of the consumer portfolio and 0.4% of the total loan portfolio) compared to $105.3 million as of September 30, 2016. Included in these amounts as of September 30, 2017 and 2016 are approximately $11 million and $12 million, respectively, of accruing TDRs.$181.3 million.

Deposits
Deposits provide the most significant funding source for interest earning assets. The following table shows the relative composition of period-end deposits as of the dates indicated. See Table 12 - Net Interest Income and Rate/Volume Analysis in this Report for information on average deposits for the time periods indicated.including average rates.
Table 5 - Composition of Period-end Deposits
(dollars in thousands)March 31, 2022
%(1)
December 31, 2021
%(1)
March 31, 2021
%(1)
Non-interest-bearing demand deposits(2)
$15,526,686 31.9 %$15,242,839 30.9 %$13,742,075 29.0 %
Interest-bearing demand deposits(2)
6,685,366 13.7 6,346,959 12.9 5,841,749 12.3 
Money market accounts(2)
14,596,877 30.0 14,886,424 30.1 13,943,717 29.5 
Savings deposits(2)
1,476,720 3.0 1,404,428 2.8 1,277,034 2.7 
Public funds6,048,704 12.5 6,284,553 12.7 6,154,948 13.0 
Time deposits(2)
2,284,207 4.7 2,427,073 4.9 3,214,761 6.8 
Brokered deposits2,037,684 4.2 2,835,000 5.7 3,194,667 6.7 
Total deposits$48,656,244 100.0 %$49,427,276 100.0 %$47,368,951 100.0 %
Core deposits(3)    
$46,618,560 95.8 %$46,592,276 94.3 %$44,174,284 93.3 %
Core transaction deposits(4)    
$38,285,649 78.7 %$37,880,650 76.6 %$34,804,575 73.5 %
Brokered time deposits$1,248,571 2.6 %$1,024,448 2.1 %$1,281,027 2.7 %
Public funds time deposits$635,801 1.3 %$665,954 1.3 %$720,711 1.5 %
Composition of Average Deposits
                
(dollars in thousands)September 30, 2017 
%(1)
 June 30, 2017 
%(1)
 December 31, 2016 
%(1)
 September 30, 2016 
%(1)
Non-interest bearing demand deposits$7,305,508
 28.9% 7,298,845
 29.2 7,280,033
 29.5 $7,042,908
 29.3
Interest bearing demand deposits4,868,372
 19.3
 4,837,053
 19.4 4,488,135
 18.2 4,274,117
 17.8
Money market accounts, excluding brokered deposits7,528,036
 29.8
 7,427,562
 29.7 7,359,067
 29.8 7,227,030
 30.1
Savings deposits803,185
 3.2
 805,019
 3.2 908,725
 3.7 797,961
 3.3
Time deposits, excluding brokered deposits3,250,929
 12.9
 3,243,670
 13.0 3,244,373
 13.2 3,278,536
 13.6
Brokered deposits1,530,889
 6.1
 1,379,559
 5.5 1,380,932
 5.6 1,409,739
 5.9
Total average deposits$25,286,919
 100.0
 24,991,708
 100.0 24,661,265
 100.0 $24,030,291
 100.0
Average core deposits(2)    
23,756,030
 93.9
 23,612,149
 94.5 23,280,334
 94.4 22,620,552
 94.1
Average core transaction deposits (2)    
$18,603,161
 73.6
 18,409,170
 73.7 17,776,147
 72.1 $17,362,060
 72.3
                
(1)Deposits balance in each category expressed as percentage of total deposits.
(2)Excluding any public funds or brokered deposits.
(3)    Core deposits exclude brokered deposits.
(4)    Core transaction deposits consist of non-interest-bearing demand deposits, interest-bearing demand deposits, money market accounts, and savings deposits excluding public funds and brokered deposits.

Total period-end deposits at March 31, 2022 decreased $771.0 million compared to December 31, 2021; however, core transaction deposits increased $405.0 million, or 4% annualized, compared to December 31, 2021 as a result of strong growth in our Consumer Banking segment as well as a focus on remixing the deposit base. Total deposit costs of 11 bps during the first quarter of 2022 declined 1 bp on a linked quarter basis after declining steadily throughout the past year, primarily as a result of the continued lower rate environment and strategic deposit mix optimization efforts.

41


Non-interest Revenue
Non-interest revenue for the first quarter of 2022 was $105.3 million, down $5.6 million, or 5%, compared to the first quarter of 2021, and on an adjusted basis(1) was $106.6 million, down $5.5 million, or 5%, from the first quarter of 2021, primarily due to lower mortgage banking income partially offset by higher core banking fees and higher wealth revenue(2).
(1) See “Non-GAAP"Table 14 - Reconciliation of Non-GAAP Financial Measures” in this Report for the applicable reconciliation to the most comparable GAAP measure.measures.
During the third quarter(2) Consists of 2017, total average deposits increased $295.2 million, or 4.7% annualized, compared to the second quarter of 2017,fiduciary and increased $1.26 billion, or 5.2%, compared to the third quarter of 2016. Excluding the acquired WFB brokered time deposits, average deposits for the third quarter of 2017 increased $223.3 million, or 3.5% annualized, compared to the second quarter of 2017. Average core transaction deposits increased $194.0 million, or 4.2% annualized, compared to the prior quarter,asset management, brokerage, and were up $1.24 billion, or 7.1%, compared to the third quarter of 2016. The increase in average deposits for the three months ended September 30, 2017 compared to the three months ended September 30, 2016 was due to growth in average core transaction deposits, which represented 73.6% of average deposits for the third quarter of 2017 compared to 72.3% a year ago. See “Non-GAAP Financial Measures” in this Report for the applicable reconciliation to the most comparable GAAP measure.
Average non-interest bearing demand deposits as a percentage of total average deposits were 28.9% for the three months ended September 30, 2017, compared to 29.2% for the three months ended June 30, 2017 and 29.3% for the three months ended September 30, 2016.
Average time deposits of $100,000 and greater for the three months ended September 30, 2017, June 30, 2017, and September 30, 2016 were $3.05 billion, $2.86 billion, and $2.81 billion, respectively, and included average brokered time deposits of $983.4 million, $815.5 million, and $775.1 million, respectively. These larger deposits represented 12.1%, 11.4%, and 11.7% of total average deposits for the three months ended September 30, 2017, June 30, 2017, and September 30, 2016, respectively, and included brokered time deposits which represented 3.9%, 3.3%, and 3.2% of total average deposits for the three months ended September 30, 2017, June 30, 2017, and September 30, 2016, respectively. Brokered time deposits acquired from WFB in the Cabela's Transaction increased average brokered time deposits by $71.9 million for the three months ended September 30, 2017.
During May 2016, Synovus launched a bank deposit sweep product, which resulted in the addition of approximately $293 million in deposits from existing customers of Synovus Securities.   These customers previously had their cash balances invested in mutual funds with an unaffiliated institution. The total aggregate balance of these accounts was approximately $326.2 million as of September 30, 2017. 
During the third quarter of 2017, total average brokered deposits represented 6.1% of total average deposits compared to 5.5% and 5.9% of total average deposits the previous quarter and the third quarter a year ago, respectively.

Non-interest Income
Non-interest income for the nine and three months ended September 30, 2017 was $276.0 million and $135.4 million, respectively, up $76.8 million, or 38.5%, and up $67.3 million, or 98.7%, compared to the nine and three months ended September 30, 2016, respectively. Adjusted non-interest income, which excludes the Cabela's Transaction Fee, net investment securities (losses) gains, net, and decrease in fair value of private equity investments, net was up $4.9 million, or 2.4%, and flat, for the nine and three months ended September 30, 2017, compared to the same periods a year ago, respectively. See "Non-GAAP Financial Measures" in this Report for the applicable reconciliation to the most comparable GAAP measure.insurance revenue.
The following table shows the principal components of non-interest income.revenue.
Table 6 - Non-interest Revenue
Three Months Ended March 31,
(dollars in thousands)20222021$ Change% Change
Service charges on deposit accounts (1)
$22,539 $20,033 $2,506 13 %
Fiduciary and asset management fees (2)
20,277 17,954 2,323 13 
Card fees (1)
14,756 11,996 2,760 23 
Brokerage revenue (2)
14,655 12,974 1,681 13 
Mortgage banking income5,953 22,315 (16,362)(73)
Capital markets income5,472 7,505 (2,033)(27)
Income from bank-owned life insurance6,556 8,843 (2,287)(26)
Insurance revenue (2)
1,419 1,697 (278)(16)
Investment securities gains (losses), net— (1,990)1,990 nm
Other non-interest revenue (1)
13,707 9,629 4,078 42 
Total non-interest revenue$105,334 $110,956 $(5,622)(5)%
Core banking fees (1)
$45,404 $38,155 $7,249 19 %
Wealth revenue (2)
$36,351 $32,625 $3,726 11 %
Non-interest Income

Nine Months Ended September 30, Three Months Ended September 30,
(in thousands)2017 2016 % Change 2017 2016 % Change
Service charges on deposit accounts$59,848
 60,772
 (1.5)% $20,255
 20,822
 (2.7)%
Fiduciary and asset management fees37,290
 34,691
 7.5
 12,615
 11,837
 6.6
Brokerage revenue21,947
 20,019
 9.6
 7,511
 6,199
 21.2
Mortgage banking income17,151
 18,755
 (8.6) 5,603
 7,329
 (23.6)
Bankcard fees24,339
 24,988
 (2.6) 7,901
 8,269
 (4.5)
Cabela's Transaction Fee75,000
 —
 nm
 75,000
 —
 nm
Investment securities (losses) gains, net(289) 126
 nm
 (7,956) 59
 nm
Decrease in fair value of private equity investments, net(3,193) (527) nm
 (27) (249) nm
Other fee income16,127
 15,255
 5.7
 5,094
 5,171
 (1.5)
Other non-interest income27,754
 25,109
 10.5
 9,439
 8,718
 8.3
Total non-interest income$275,974
 199,188
 38.5 % $135,435
 68,155
 98.7 %
            
(1) Core banking fees consist of service charges on deposit accounts, card fees, and several other non-interest revenue components including letter of credit fees, ATM fee income, line of credit non-usage fees, gains (losses) from sales of SBA loans, and miscellaneous other service charges.
Principal Components(2) Consists of Non-interest Incomefiduciary and asset management, brokerage, and insurance revenue.
Three Months Ended March 31, 2022 compared to March 31, 2021
Service charges on deposit accounts, for the nine and three months ended September 30, 2017 were down $924 thousand, or 1.5%, and down $567 thousand, or 2.7%, respectively, compared to the nine and three months ended September 30, 2016. Service charges on deposit accounts consistconsisting of NSFaccount analysis fees, account analysisNSF fees, and all other service charges. NSF fees were $27.4 million and $9.4 millioncharges, for the nine and three months ended September 30, 2017, respectively, down $647 thousand, or 2.3%, and $236 thousand, or 2.4%,March 31, 2022 were up compared to the ninesame period in 2021, with growth in all three service charge categories. The largest category of service charges, account analysis fees, were up $609 thousand, or 7%, reflecting our continued investments in Treasury and Payments solutions. NSF fees for the three months ended September 30, 2016, respectively. The decline inMarch 31, 2022 and 2021 comprised 32% and 29%, respectively, of service charges on deposit accounts and 7% and 5%, respectively, of total non-interest revenue. NSF fees from prior year isfor the three months ended March 31, 2021 were lower primarily due to lower Regulation E opt-in rates on new accounts as well as lower incident levels given higher average deposit balances. Account analysis fees were $18.6 million and $6.3 million for the nine and three months ended September 30, 2017, respectively, up $382 thousand, or 2.1%, and up $122 thousand, or 2.0%, compared to the nine and three months ended September 30, 2016, respectively.fiscal stimulus funds. All other service charges on deposit accounts, which consist primarily of monthly fees on retailconsumer demand depositdeposits and savingsmall business accounts, for the nine and three months ended September 30, 2017March 31, 2022 were $13.9 million and $4.5 million, down $659up $650 thousand, or 4.5%, and $452 thousand, or 9.2%, compared to the same periods in 2016. The decline in all other service charges is largely due to a one-time impact during 2017 from account level conversions required for Synovus Bank's transition to a single bank operating environment.13%.
Fiduciary and asset management fees are derived from providing estate administration, employee benefit plan administration, personal trust, corporate trust, corporate bond, investment management, and financial planning, and family office services. FiduciaryThe increase in fiduciary and asset management fees increased $2.6 million, or 7.5%, and $778 thousand, or 6.6%, for the nine and three months ended September 30, 2017, respectively, compared to the nine and three months ended September 30, 2016. The year-over-year increase isMarch 31, 2022 was driven by strong client acquisition and growth in total assets under management which ended the quarterincreased by 4% from March 31, 2021 to $21.36 billion at $13.0 billion, an increase of 14.8% from September 30, 2016, from higher equity markets as well as increased banker productivity, as Synovus continues to benefit from new talent additions.March 31, 2022.
Brokerage revenue, which consists primarily of brokerage commissions, was $21.9 million and $7.5 million for the nine and three months ended September 30, 2017, respectively, up $1.9 million, or 9.6%, and up $1.3 million, or 21.2%, compared to the nine and three months ended September 30, 2016, respectively. The increase for 2017 compared to 2016 is largely driven by growth in brokerage assets under management, which ended the quarter at $2.25 billion, an increase of 22.3% from September 30, 2016, as well as increased banker productivity, as Synovus continues to benefit from new talent additions.


Mortgage banking income was $17.2 million and $5.6 million for the nine and three months ended September 30, 2017, respectively, compared to $18.8 million and $7.3 million for the same periods in 2016. During the third quarter of 2017, mortgage production excluding portfolio loan production decreased 1.9% sequentially and declined 14.3% from the same time period in 2016, reflecting a decline in refinancing volume. Total mortgage production for the first nine months of 2017 was $978.7 million. Mortgage production excluding portfolio loan production for the nine months ended September 30, 2017 was $491.3 million, down 5.2% from the same time period of 2016.
Bankcard fees totaled $24.3 million and $7.9 million for the nine and three months ended September 30, 2017, respectively, compared to $25.0 million and $8.3 million for the same periods in 2016. BankcardCard fees consist primarily of credit card interchange fees, and debit card interchange fees. Debit card interchange fees, were $12.9 million, up $109 thousand, or 0.9%, and $4.3 million, up $4 thousand, or 0.1%,merchant discounts. Card fees are reported net of certain associated expense items including client loyalty program expenses and network expenses. Card fees for the nine and three months ended September 30, 2017, respectively,March 31, 2022 were up primarily from increased transaction volume in all card fee categories as we continue to invest in our Treasury and Payment solutions business.
Brokerage revenue consists primarily of brokerage commissions as well as advisory fees earned from the management of client assets. Brokerage revenue for the three months ended March 31, 2022 increased over the prior year comparable period, driven by growth in assets under management of 19% and strong client acquisition.
Mortgage banking income, consisting of net gains on loan origination/sales activities, was significantly lower for the first quarter of 2022 compared to the same periods in 2016. Credit card interchange fees were $16.6 million, down $254 thousand, or 1.5%, and $5.5 million, down $147 thousand, or 2.6%, for the nine and three months ended September 30, 2017, respectively,March 31, 2021 with the decline largely driven by $11.3 million lower gains on sale as a result of a $318.8 million, or 60%, decrease in loan sales and lower secondary market mortgage loan

42


production. Total secondary market mortgage loan production was $221.0 million, down $352.2 million, or 61%, compared to the same periodsprior year. Increasing mortgage rates which has resulted in 2016.lower refinancing volumes has also contributed to the decline.
On September 25, 2017, Synovus Bank completed the Cabela's TransactionCapital markets income primarily includes fee income from client derivative transactions. Additionally, capital markets income includes fee income from debt capital market transactions and received the Cabela's Transaction Fee.
Investment securities (losses) gains, net, were ($289) thousand and ($8.0) million,foreign exchange as well as other miscellaneous income from capital market transactions. The decline for the nine and three months ended September 30, 2017, respectively. DuringMarch 31, 2022 primarily resulted from $2.2 million lower fees on client derivative transactions due to decreased volume of activity.
Income from BOLI includes increases in the third quartercash surrender value of 2017, as part of its balance sheet restructuring actions, Synovus repositionedpolicies and proceeds from insurance contracts. The decrease for the available for sale securities portfolio and recorded a net loss of ($8.0) million. Thethree months ended March 31, 2022 primarily related to $2.1 million in proceeds from insurance contracts in the first quarter of 2017 included a $3.4 million gain on the sale2021.
The main components of an equity position and a $4.3 million gain from the repositioning of the investment securities portfolio.
Other fee income includesother non-interest revenue are fees for letters of credit and unused lines of credit, safe deposit box fees, access fees for automated teller machineATM use, customer swap dealer fees, and other service charges. Other feecharges and loan servicing fees, income was higher by $871 thousand, or 5.7%, for the nine months ended September 30, 2017, compared to the same period in 2016 driven by higher customer swap dealer fees and syndication arranger fees.
The main components of other non-interest income are income from BOLI policies, insurance commissions, gains from sales of GGL/SBA loans, card sponsorship fees, and other miscellaneous items. The increase of $2.6 million, or 10.5%, and $721 thousand, or 8.3%, during the nine and three months ended September 30, 2017, respectively, comparedMarch 31, 2022 included a gain of $3.5 million related to the same periods in 2016, was due primarily to growth in BOLI revenues and gains on sales of GGL/SBA loans. BOLI revenues grew $2.2 million and $726 thousand during the nine and three months ended September 30, 2017, respectively, driven by additional investments in BOLI policies. Gains from the sale of GGL/a certain real estate partnership, a $1.3 million increase in gains from sales of SBA loans, were up $1.1and a decrease in the fair adjustment on non-qualified deferred compensation of $2.1 million, as compared to 2016 on a year-to-date basis and lower by $112 thousand for the third quarter of 2017 compared to the third quarter of 2016.2021.
Non-interest Expense
Non-interest expense for the nine and three months ended September 30, 2017 was $594.8 million and $205.6 million, respectively, compared to $562.7 million and $185.9 million for the nine and three months ended September 30, 2016, respectively. Adjusted non-interest expense for the nine and three months ended September 30, 2017, which excludes the thirdfirst quarter of 2017 balance sheet restructuring actions of impairments on ORE and other properties held for sale, restructuring charges, net, loss on early extinguishment of debt, net, litigation contingency/settlement expense, merger-related expense, fair value adjustment to Visa derivative, amortization of intangibles, and certain earnout liability adjustments, increased $30.72022 was $272.5 million, up $5.3 million, or 5.6%, and $10.2 million, or 5.5%2%, compared to the same periodsperiod in 2016, respectively. Synovus continues2021 while adjusted non-interest expense(1)of $279.5 million was up $13.7 million, or 5%. The increase in adjusted non-interest expense(1) during 2022 was primarily due to generate positive operating leveragean increase in expense associated with the year-over-year expense growth primarily driven by strategicincentives and elevated performance, resumption of normal business activities post COVID-19, and investments in talent and technology, higher third-party processing expense relating to third-party lending partnerships servicing fees, the addition of Global One, and expenses associated with Synovus Bank's transition to a single bank operating environment and single brand. Strategic investments in talent and technology accounted for approximately $15 million and $5 million of the increasenew growth initiatives. The adjusted tangible efficiency ratio(1) for the nine andfirst three months ended September 30, 2017, respectively,of 2022 was 55.50%, up 138 bps compared to the same periodsperiod a year ago. We expect total investments in 2016, as Synovus continuesnew growth initiatives to add key talent and invest in technology to enhance the customer experience. Third-party processing expense relating to the servicing fees of third-party lending partnerships increased by $3.4be between $25 million and $1.2$30 million for the nine and three months ended September 30, 2017, respectively, compared to the same periods in 2016, and Global One operating expenses accounted for $3.0 million and $1.2 million2022.
(1) See "Table 14 - Reconciliation of the increase compared to the nine and three months ended September 30, 2016, respectively. Expenses associated with Synovus Bank's transition to a single bank operating environment and single brand resulted in higher expenses of $4.0 million and $1.1 million compared to the nine and three months ended September 30, 2016, respectively. See "Non-GAAPNon-GAAP Financial Measures"Measures” in this Report for the applicable reconciliation to the most comparable GAAP measure.

measures.
The following table summarizes the components of non-interest expense for the nine and three months ended September 30, 2017 and 2016.expense.
Table 7 - Non-interest Expense
Three Months Ended March 31,
(dollars in thousands)20222021$ Change% Change
Salaries and other personnel expense$164,684 $161,477 $3,207 2 %
Net occupancy, equipment, and software expense42,877 41,134 1,743 4 
Third-party processing and other services20,996 20,032 964 5 
Professional fees8,474 9,084 (610)(7)
FDIC insurance and other regulatory fees6,250 5,579 671 12 
Amortization of intangibles2,118 2,379 (261)(11)
Restructuring charges(6,424)531 (6,955)nm
Loss on early extinguishment of debt677 — 677 nm
Other operating expense32,798 26,918 5,880 22 
Total non-interest expense$272,450 $267,134 $5,316 2 %
Non-interest Expense

           
 Nine Months Ended September 30, Three Months Ended September 30,
(in thousands)2017 2016 % Change 2017 2016 % Change
Salaries and other personnel expense$322,079
 300,364
 7.2 % $109,675
 101,945
 7.6 %
Net occupancy and equipment expense89,837
 81,480
 10.3
 30,573
 28,120
 8.7
Third-party processing expense39,882
 34,033
 17.2
 13,659
 11,219
 21.7
FDIC insurance and other regulatory fees20,723
 20,100
 3.1
 7,078
 6,756
 4.8
Professional fees20,048
 19,794
 1.3
 7,141
 6,486
 10.1
Advertising expense14,868
 15,358
 (3.2) 3,610
 5,597
 (35.5)
Foreclosed real estate expense, net10,847
 9,998
 8.5
 7,265
 2,725
 166.6
Earnout liability adjustment3,766
 —
 nm
 2,059
 —
 nm
Merger-related expense110
 550
 (80.0) 23
 550
 (95.8)
Loss on early extinguishment of debt, net—
 4,735
 nm
 —
 —
 nm
Fair value adjustment to Visa derivative—
 1,079
 nm
 —
 360
 nm
Restructuring charges, net7,043
 8,225
 (14.4) 519
 1,243
 (58.2)
Other operating expenses65,577
 67,000
 (2.1) 24,044
 20,870
 15.2
Total non-interest expense$594,780
 562,716
 5.7 % $205,646
 185,871
 10.6 %
            
Three Months Ended March 31, 2022 compared to March 31, 2021
Salaries and other personnel expensesexpense increased $21.7 million, or 7.2%, and $7.7 million, or 7.6%, for the nine and three months ended September 30, 2017, respectively, compared to the same periods in 2016,March 31, 2022 primarily due to annual merit increases, talent additions,an increase in incentive compensation from elevated performance and higher self-insuranceshare-based compensation expense, and Global One.largely due to timing with a higher level of retirement eligible expense acceleration, partially offset by lower mortgage production-based commissions. Total headcount of 5,002 declined 173, or 3%, from March 31, 2021, led by branch closures.
Net occupancy, equipment, and equipmentsoftware expense was up $8.4 million, or 10.3%, and $2.5 million, or 8.7%,increased for the nine and three months ended September 30, 2017, respectively,March 31, 2022 due primarily to continued investments in technology partially offset by savings from branch closures. Synovus Bank operated 272 branches at March 31, 2022 compared to 288 branches at March 31, 2021 with nine branch closures during the same periodsfirst quarter of 2022. We forecast that by the end of the year the run-rate pre-tax total non-interest expense benefit from 2022 branch reductions will exceed $15 million, some of which will be reinvested in 2016 as costs associated with growth in technology investments offset efficiencies gained in occupancy and related expenses. Synovus' branch network consists of 249 locations at September 30, 2017 compared to 250 branches a year ago.   our digital delivery channel.
Third-party processing expense includesand other services include all third-party core operating system and processing charges as well as third-party loan servicing charges. Third-party processing expense increased $5.8 million, or 17.2%, and $2.4 million, or 21.7%, for thenine and three months ended September 30, 2017, respectively, comparedMarch 31, 2022,

43


largely a result of digital enhancements as we migrate clients to the same periods in 2016, drivenour Gateway digital commercial platform, which was partially offset by an increase of $3.4 million and $1.2 millionlower expense associated with PPP loan forgiveness.
Professional fees decreased for the nine and three months ended September 30, 2017, respectively, comparedMarch 31, 2022 primarily from lower consulting fees related to the same periods in 2016, from servicing fees associated with loan growth from Synovus' two consumer-based lending partnerships.Synovus Forward.
FDIC insurance and other regulatory fees increased by $623 thousand, or 3.1%, and $322 thousand, or 4.8%, for the nine and three months ended September 30, 2017, compared to the same periods in 2016. On March 15, 2016, the FDIC approved a final rule to increase the DIF to the statutorily required minimum level of 1.35%. Congress, in the Dodd-Frank Act, increased the minimum for the DIF reserve ratio, the ratio of the amount in the fund to insured deposits, from 1.15% percent to 1.35% and required that the ratio reach that level by September 30, 2020. Further, the Dodd-Frank Act also made banks with $10 billion or more in total assets responsible for the increase from 1.15% to 1.35%. Under a rule adopted by the FDIC in 2011, regular assessment rates for all banks would decline when the reserve ratio reached 1.15%, which occurred during the second quarter of 2016. Banks with total assets of less than $10 billion have substantially lower assessment rates under the 2011 rule. The final rule imposed on banks with at least $10 billion in assets a surcharge of 4.5 cents per $100 of their assessment base, after making certain adjustments. The FDIC expects the reserve ratio will likely reach 1.35% after approximately two years of payments of the surcharges. The final rule became effective on July 1, 2016 with surcharge assessments beginning July 1, 2016. Synovus' FDIC insurance cost remained relatively flat to prior levels following the surcharge assessment since regular assessment rates declined at the same time the surcharge assessment became effective.
Professional fees for the nine and three months ended September 30, 2017 were up $254 thousand, or 1.3%, and $655 thousand, or 10.1%, respectively, compared to the same periods in 2016, driven by increases in consulting expense primarily related to Synovus Bank's transition to a single bank operating environment.
Foreclosed real estate expense for the nine and three months ended September 30, 2017 included the third quarter of 2017 balance sheet restructuring actions with $7.1 million recorded for discounts to fair value for completed or planned ORE accelerated dispositions. ORE balances declined $17.9 million to $10.6 million at September 30, 2017 compared to prior year.

During the nine and three months ended September 30, 2017, Synovus recorded contingent consideration expense of $3.8 million, and $2.1 million, respectively, resulting from updates to the estimated fair value of the Global One earnout liability.   
Merger-related expense consists of professional fees relating to the October 1, 2016 acquisition of Global One. See "Note 2- Acquisitions" in this Report for more information on the acquisition of Global One.
During January 2016, Synovus repurchased $124.7 million of its subordinated notes that matured on June 15, 2017 in conjunction with Synovus' cash tender offer that commenced on December 23, 2015 and expired on January 22, 2016. Results for the nine months ended September 30, 2016 included a $4.7 million pre-tax loss relating to this tender offer. 
On September 25, 2017, Synovus issued a notice of redemption to redeem all of the $300.0 million aggregate principal amount of its outstanding 7.875% senior notes due 2019 on November 9, 2017 at a “make whole” premium, plus accrued but unpaid interest on the 2019 notes to the redemption date.  The results for the three months ending December 31, 2017 will include a pre-tax loss of approximately $24 million related to early extinguishment of these notes.
    Restructuring charges of $7.0 million were recorded during the nine months ended September 30, 2017 consisting primarily of severance charges of $6.4 million recorded during the first quarter of 2017. Severance charges included $6.2 million for termination benefits incurred in conjunction with a voluntary early retirement program offered during the first quarter of 2017. This program was part of Synovus' ongoing efficiency initiatives. For the three months ended September 30, 2017, Synovus recorded restructuring charges of $519 thousand due to additional asset impairment charges of $515 thousand on properties previously identified for disposition. During the nine months ended September 30, 2016, Synovus recorded restructuring charges of $8.2 million with $4.8 million of those charges related to corporate real estate optimization activities and $3.3 million associated with branch closures.
Other operating expenses for the three months ended September 30, 2017 included balance sheetMarch 31, 2022 largely due to a higher assessment rate primarily driven by the redemption of Synovus Bank senior notes.
During the three months ended March 31, 2022, Synovus recorded $9.1 million in gains largely relating to the sale of real estate facilities in Columbus, Georgia, which was partially offset by restructuring charges relating to twelve branches expected to close in the second quarter of $1.22022. During the three months ended March 31, 2021, Synovus recorded restructuring charges primarily associated with two branch closures.
On February 10, 2022 Synovus Bank redeemed its 2.289% Fixed-to-Floating Rate Senior Bank Notes of $400 million for asset impairment charges related to accelerated dispositionpar value and incurred a $677 thousand loss on early extinguishment of debt.
Other operating expense includes advertising, travel, insurance, network and communication, other properties held for sale whiletaxes, subscriptions and dues, other loan and ORE expense, postage and freight, training, business development, supplies, donations, and other miscellaneous expense. Other operating expensesexpense was up for the three months ended September 30, 2016 were reduced by $1.7March 31, 2022. The increase over prior year was primarily related to an increase in loan expense due to elevated production, managing fraud protection for clients, and resumption of normal business activities post COVID-19.
Income Tax Expense
Income tax expense was $42.7 million in gains on sales of properties held for sale. Additionally, the three months ended September 30, 2016 included a $2.4 million gain related to the purchase of an additional interest in an existing NPL at a discount that was subsequently paid in full. Other operating expenses for the nine months ended September 30, 2017 included a $2.4 million gain from the settlement of a contingent receivable during the second quarter of 2017 while the nine months ended September 30, 2016 included litigation settlement expense of $2.5 million recognized primarily during the first quarter of 2016.
The efficiency ratio improved to below 59% during the third quarter of 2017. The adjusted efficiency ratio was 58.59% in the third quarter of 2107 compared to 62.41% in the third quarter of 2016. The calculation of the adjusted efficiency ratio was revised during the first quarter of this year.  ORE expense and other credit costs had been excluded since the financial crisis due to the abnormal level of expenditure.  Given the more normalized level of expense that Synovus is now experiencing, these costs will be included in the calculation hereafter (excluding the third quarter of 2017 balance sheet restructuring actions) and previous quarters have been restated as well. The change in the calculation resulted in a higher adjusted efficiency ratio. See "Non-GAAP Financial Measures" in this Report for the applicable reconciliation to the most comparable GAAP measure.
Income Tax Expense
Income tax expense was $130.3 million and $54.7 million for the nine and three months ended September 30, 2017, respectively,March 31, 2022, representing an effective tax rate of 34.6% and 35.8% for the respective periods20.0%, compared to income tax expense of $102.1 million and $37.4$49.2 million for the nine and three months ended September 30, 2016, respectively,March 31, 2021, representing an effective tax rate of 36.4% for both periods.
20.8%. The effective tax rate is impacted by discrete items that may occur in any given period but are not consistent from period-to-period such as share-based compensation, valuation allowance changes, and changes to unrecognized tax benefits. The decrease inlower for the effective tax rate in 2017 as compared to 2016 is primarily related to the adoption of ASU 2016-09, as further described below. The effective tax rate for 2017 also reflects a $2.6 million reduction in the deferred tax asset valuation allowance relating to certain tax credits.
As disclosed in Note 1, Synovus adopted ASU 2016-09 effective January 1, 2017, which includes a requirement to record all tax effects associated with share-based compensation through the income statement.  These tax effects, which are determined upon the vesting of restricted share units and the exercise of stock options, are treated as discrete items in the period in which they occur.  For the nine and three months ended September 30, 2017,March 31, 2022, due to an increase in net discrete tax benefits recognized during the impact from the adoption of ASU 2016-09 was an income tax benefit of $4.7 millionperiod, including share-based compensation, changes in amounts taxable by jurisdictions, and $211 thousand, respectively. other accrual adjustments.

CREDIT QUALITY, CAPITAL RESOURCES AND LIQUIDITY
Credit Quality
Synovus continuously monitors the quality of its loan portfolio by industry, property type, geography, as well as credit quality metrics. At March 31, 2022, credit metrics remained stable and maintains an allowancenear historical lows with NPAs at 40 bps, NPLs at 33 bps, and total past dues at 11 bps, as a percentage of total loans. Net charge-offs remained low at $18.6 million, or 19 bps annualized, for loan losses that management believes is sufficient to absorb probable losses inherent in its loan portfolio. Credit quality metrics have remained favorable during the first nine months of 2017. The decline in non-performing assets is driven by the activities described below.
During the three months ended September 30, 2017, Synovus completed certain balance sheet restructuring actions which included the transfer of $77.8 million in loans (consisting primarily of non-performing loans) to held-for-sale.  This action resulted in provision expense of $27.7 million andMarch 31, 2022. We expect net charge-offs to remain relatively stable in the second quarter of $34.2 million due to2022, assuming no material change in the actual or planned sale of such loans in an accelerated timeline, which required discounts below fair value.  Additionally, the third quarter results also reflect ORE write-downs totaling $7.1 million consisting of discounts to fair value for completed or planned ORE accelerated dispositions.  economic environment.

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The table below includes selected credit quality metrics.
Table 8 - Credit Quality Metrics
(dollars in thousands)March 31, 2022December 31, 2021March 31, 2021
Non-performing loans$132,131 $131,042 $155,169 
Impaired loans held for sale— — 23,590 
ORE and other assets26,759 27,137 16,849 
Non-performing assets$158,890 $158,179 $195,608 
Total loans$40,169,150 $39,311,958 $38,805,101 
Non-performing loans as a % of total loans0.33 %0.33 %0.40 %
Non-performing assets as a % of total loans, ORE, and specific other assets0.40 0.40 0.50 
Loans 90 days past due and still accruing$3,067 $6,770 $3,804 
As a % of total loans0.01 %0.02 %0.01 %
Total past due loans and still accruing$45,385 $57,565 $45,693 
As a % of total loans0.11 %0.15 %0.12 %
Net charge-offs, quarter$18,609 $10,522 $20,204 
Net charge-offs/average loans, quarter0.19 %0.11 %0.21 %
Provision for (reversal of) loan losses, quarter$5,968 $(54,124)$(22,318)
Provision for (reversal of) unfunded commitments, quarter5,432 (1,086)3,743 
Provision for (reversal of) credit losses, quarter$11,400 $(55,210)$(18,575)
Allowance for loan losses$414,956 $427,597 $563,214 
Reserve for unfunded commitments47,317 41,885 51,528 
Allowance for credit losses$462,273 $469,482 $614,742 
ACL to loans coverage ratio1.15 %1.19 %1.58 %
ALL to loans coverage ratio1.03 1.09 1.45 
ACL/NPLs349.86 358.27 396.18 
ALL/NPLs314.05 326.31 362.97 
Criticized and Classified Loans
Our loan ratings are aligned to federal banking regulators' definitions of pass and criticized categories, which include special mention, substandard, doubtful, and loss. Substandard accruing and non-accruing loans, doubtful, and loss loans are often collectively referred to as classified. Special mention, substandard, doubtful, and loss loans are often collectively referred to as criticized and classified loans. The following table presents a summary of criticized and classified loans. Criticized and classified loans at March 31, 2022 remained at 2.6% of total loans, or $1.03 billion, as compared to December 31, 2021.
Table 9 - Criticized and Classified Loans
(dollars in thousands)March 31, 2022December 31, 2021
Special mention$509,292 $489,150 
Substandard515,529 526,117 
Doubtful4,132 10,630 
Loss2,558 2,058 
Criticized and Classified loans$1,031,511 $1,027,955 
As a % of total loans2.6 %2.6 %

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Credit Quality Metrics 
(dollars in thousands)September 30, 2017 December 31, 2016 September 30, 2016
Non-performing loans    $97,838
 153,378
 148,155
Impaired loans held for sale(1)
30,197
 —
 2,473
Other real estate10,551
 22,308
 28,438
 Non-performing assets    $138,586
 175,686
 179,066
Non-performing loans as a % of total loans0.40% 0.64
 0.64
Non-performing assets as a % of total loans, other loans held for sale, and ORE0.57
 0.74
 0.77
Loans 90 days past due and still accruing$5,685
 3,135
 5,358
As a % of total loans0.02% 0.01
 0.02
Total past due loans and still accruing$84,853
 65,106
 61,781
As a % of total loans0.35% 0.27
 0.27
Net charge-offs, quarter$38,098
 8,319
 6,930
Net charge-offs/average loans, quarter0.62% 0.14
 0.12
Net charge-offs, year-to-date$60,695
 28,738
 20,420
Net charge-offs/average loans, year-to-date0.33% 0.12
 0.12
Provision for loan losses, quarter$39,686
 6,259
 5,671
Provision for loan losses, year-to-date58,620
 28,000
 21,741
Allowance for loan losses249,683
 251,758
 253,817
Allowance for loan losses as a % of total loans1.02% 1.06
 1.09
      
Provision for (Reversal of) Credit Losses and Allowance for Credit Losses
(1) Represent only impairedThe provision for credit losses of $11.4 million for the three months ended March 31, 2022 included net charge-offs of $18.6 million and also represented a slowing of allowance releases due primarily to the increased economic uncertainty from inflation concerns and geopolitical tensions. $3.8 million in reserves were also added as a result of purchases of $181.3 million of third-party lending loans that have been specifically identified to be sold. Impaired loans held for sale are carried at the lowerthree months ended March 31, 2022.
The ALL of cost or fair value, less costs to sell, based primarily on estimated sales proceeds net$415.0 million and the reserve for unfunded commitments of selling costs.
Non-performing Assets
Total NPAs were $138.6$47.3 million, which is recorded in other liabilities, comprise the total ACL of $462.3 million at September 30, 2017, a $37.1March 31, 2022. The ACL decreased $7.2 million or 21.1%, decreasecompared to the December 31, 2021 ACL of $469.5 million, which consisted of an ALL of $427.6 million and the reserve for unfunded commitments of $41.9 million. The ACL to loans coverage ratio of 1.15% at March 31, 2022 was 4 bps lower compared to December 31, 2021.
The reduction in the ACL resulted primarily from $175.7continued positive trends in our credit performance and loan mix mostly offset by an increase in the downside weighting of the multiple scenario model which reflects the increased economic uncertainty noted above and slowed the pace of the allowance decline this quarter.
Table 10 - Accruing TDRs by Risk Grade
March 31, 2022December 31, 2021March 31, 2021
(dollars in thousands)Amount%Amount%Amount%
Pass$61,298 42.0 %$56,479 47.1 %$63,809 49.2 %
Special mention6,531 4.5 11,387 9.5 8,560 6.6 
Substandard accruing78,128 53.5 51,938 43.4 57,407 44.2 
Total accruing TDRs$145,957 100.0 %$119,804 100.0 %$129,776 100.0 %
Troubled Debt Restructurings
Accruing TDRs were $146.0 million at March 31, 2022, up $26.2 million compared to December 31, 2021 primarily due to modifications granted that were previously accounted for under the CARES Act. Non-accruing TDRs were $21.3 million at March 31, 2022, compared to $22.3 million at December 31, 2016 and a $40.5 million, or 22.6%, decrease from $179.1 million at September 30, 2016. The year-over-year decline in non-performing assets was driven by the continued resolution of problem assets including accelerated dispositions and transfers to held for sale in conjunction with the balance sheet restructuring actions described above. Total non-performing assets as a percentage of total loans, other loans held for sale, and other real estate were 0.57% at September 30, 2017 compared to 0.74% at December 31, 2016 and 0.77% at September 30, 2016.2021.
Retail Trade Loan Portfolio
As of September 30, 2017, loans in the retail trade industry consisted of $844.1 million of C&I loans and $840.4 million of CRE (investment properties) loans. These portfolios are well-diversified geographically. Based on an analysis of these portfolios as of September 30, 2017, we believe that the majority of these loans do not have exposure to the retail sectors which are most adversely impacted by competition from online retail and big-box retail store closures. As of September 30, 2017, these portfolios had non-performing loans of $4.3 million, 0.01% of loans past due 90 days or more, and 0.13% of loans past due 30 days or more as a percentage of total retail trade loans outstanding.

Troubled Debt Restructurings
Accruing TDRs were $166.9 million at September 30, 2017, compared to $195.8 million at December 31, 2016 and $201.9 million at September 30, 2016. Accruing TDRs declined $28.9million, or 14.7%, from December 31, 2016 and $35.0 million, or 17.3%, from a year ago primarily due to continued decline in TDR inflows, fewer TDRs needing to retain the TDR designation upon subsequent renewal, refinance, or modification, and pay-offs.
At September 30, 2017, the allowance for loan losses allocated to these accruing TDRs was $8.5 million compared to $9.8 million at December 31, 2016 and $11.8 million at September 30, 2016. Accruing TDRs are considered performing because they are performing in accordance withwith the restructured terms. At September 30, 2017both March 31, 2022 and December 31, 2016, 94% and 99%, respectively,2021, approximately 98% of accruing TDRs were current. In addition, subsequent defaults on accruing TDRs (defaults defined as the earlier of the TDR being placed on non-accrual status or reaching 90 days past due with respect to principal and/or interest payments within twelve months of the TDR designation) have remained negligible,continued to remain at low levels.
Non-TDR Modifications due to COVID-19
The Interagency Statement on Loan Modifications and consisted of four defaultsReporting for Financial Institutions Working with a recorded investment of $498 thousand forCustomers Affected by the nine months ended September 30, 2017 comparedCoronavirus provided that eligible loan modifications related to two defaults with a recorded investment of $181 thousand for the nine months ended September 30, 2016.
Accruing TDRs by Risk GradeSeptember 30, 2017 December 31, 2016 September 30, 2016
(dollars in thousands)Amount % Amount % Amount %
Pass$65,018
 39.0% 81,615
 41.7 66,887
 33.1
Special Mention17,759
 10.6
 29,250
 14.9 37,259
 18.6
Substandard accruing84,141
 50.4
 84,911
 43.4 97,750
 48.4
  Total accruing TDRs$166,918
 100.0% 195,776
 100.0 201,896
 100.0
            

Accruing TDRs Aging by Portfolio Class
 September 30, 2017
(in thousands)Current 30-89 Days Past Due 90+ Days Past Due Total 
Investment properties$27,715
 —
 —
 27,715
 
1-4 family properties15,695
 46
 —
 15,741
 
Land and development15,344
 229
 —
 15,573
 
Total commercial real estate58,754
 275
 —
 59,029
 
Commercial, financial and agricultural36,094
 7,166
 58
 43,318
 
Owner-occupied34,085
 1,683
 —
 35,768
 
Total commercial and industrial70,179
 8,849
 58
 79,086
 
Home equity lines5,988
 7
 —
 5,995
 
Consumer mortgages17,038
 1,298
 —
 18,336
 
Credit cards—
 —
 —
 —
 
Other consumer loans4,469
 3
 —
 4,472
 
Total consumer27,495
 1,308
 —
 28,803
 
Total accruing TDRs$156,428
 10,432
 58
 166,918
 
         
 December 31, 2016
(in thousands)Current 30-89 Days Past Due 90+ Days Past Due Total 
Investment properties$30,182
 133
 —
 30,315
 
1-4 family properties22,694
 —
 —
 22,694
 
Land and development26,015
 10
 —
 26,025
 
Total commercial real estate78,891
 143
 —
 79,034
 
Commercial, financial and agricultural31,443
 798
 —
 32,241
 
Owner-occupied52,333
 —
 —
 52,333
 
Total commercial and industrial83,776
 798
 —
 84,574
 
Home equity lines7,526
 412
 —
 7,938
 
Consumer mortgages18,518
 572
 —
 19,090
 
Credit cards—
 —
 —
 —
 
Other consumer loans5,013
 127
 —
 5,140
 
Total consumer31,057
 1,111
 —
 32,168
 
Total accruing TDRs$193,724
 2,052
 —
 195,776
 
         
Non-accruing TDRs were $9.0 million at September 30, 2017 compared to $11.4 million at December 31, 2016. Non-accruing TDRs generallyCOVID-19 may be returned to accrual status if there has been a periodaccounted for under section 4013 of performance, consisting usually of at least a six month sustained period of repayment performancethe CARES Act or in accordance with ASC 310-40. The Consolidated Appropriations Act, 2021 extended the termsapplicable period of Section 4013 of the agreement.
Potential Problem Loans
Potential problem loansCARES Act which allowed banks to elect to not consider loan modifications related to COVID-19 that are defined by management as being certain performing loans with a well-defined weakness where there is known information about possible credit problemsmade between March 1, 2020 and the earlier of January 1, 2022, or 60 days after the national emergency ends to borrowers which causes management to have concerns about the ability of such borrowers to comply with the present repayment terms of such loans. Potential problem commercial loans consist of commercial Substandard accruing loans but exclude loans 90that are current (i.e., less than 30 days past due and still accruing interest and accruing TDRs classified as Substandard since these loans are disclosed separately. Potential problem commercial loans were $125.4 million at September 30, 2017 compared to $162.0 million and $172.5 million atof December 31, 2016 and September 30, 2016, respectively. Synovus cannot predict whether these potential problem2019) as TDRs. The regulatory agencies further stated that performing loans ultimately will become non-performing loans or result in losses.
Net Charge-offs
Net charge-offs for the nine months ended September 30, 2017 were $60.7 million, or 0.33% as a percentage of average loans annualized, compared to $20.4 million, or 0.12%, as a percentage of average loans annualized for the nine months ended September 30, 2016. The $40.3 million increase from 2016 is primarilygranted payment deferrals due to $34.2 millionCOVID-19 are not considered past due or non-accrual. FASB confirmed the foregoing regulatory agencies' view that such short-term modifications (e.g., six months) made on a good-faith basis in net charge-offs recorded during the third quarter of 2017 in conjunctionresponse to COVID-19 for borrowers who are current are not TDRs.
The CARES Act election period ended on January 1, 2022, and we have provided borrowers who have been impacted by COVID-19 with the aforementioned transfers to held for sale completed during the quarter.

Provision for Loan Losses and Allowance for Loan Losses
For the nine months ended September 30, 2017, the provision for loan losses was $58.6 million, an increase of $36.9 million,modifications such as interest-only relief or 169.6%, compared to the nine months ended September 30, 2016primarily due to $27.7 million incurred in connection with the aforementioned transfers to held for sale completed during the third quarter.
The allowance for loan losses at September 30, 2017 was $249.7 million, or 1.02% of total loans, compared to $251.8 million, or 1.06%amortization extensions on under 2% of total loans, at both March 31, 2022 and December 31, 2016 and $253.8 million, or 1.09% of total loans, at September 30, 2016.  2021.
Capital Resources
Synovus and Synovus Bank are required to comply with capital adequacy standards established by theirour primary federal regulator, the Federal Reserve. Synovus has always placed great emphasis on maintaining a solidand Synovus Bank measure capital base and continues to satisfy applicable regulatory capital requirements.
adequacy using the standardized approach under Basel III. At September 30, 2017,March 31, 2022, Synovus and Synovus Bank's capital levels eachremained strong and exceeded well-capitalized requirements currently in effect. The following table presents certain ratios used to measure Synovus and Synovus Bank's capitalization.

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Capital Ratios   
Table 11 - Capital RatiosTable 11 - Capital Ratios
(dollars in thousands) September 30, 2017 December 31, 2016(dollars in thousands)March 31, 2022December 31, 2021
Common equity Tier 1 capital (transitional)   
CET1 capitalCET1 capital
Synovus Financial Corp.$2,749,304
 2,654,287Synovus Financial Corp.$4,485,661 $4,388,618 
Synovus Bank3,164,640
 3,187,583Synovus Bank5,064,643 4,998,698 
Tier 1 capital   
Tier 1 risk-based capitalTier 1 risk-based capital
Synovus Financial Corp.2,849,580
 2,685,880Synovus Financial Corp.5,022,806 4,925,763 
Synovus Bank3,164,640
 3,187,583Synovus Bank5,064,643 4,998,698 
Total risk-based capital   Total risk-based capital
Synovus Financial Corp.3,362,127
 3,201,268
Synovus Financial Corp.5,936,543 5,827,196 
Synovus Bank3,417,187
 3,441,563
Synovus Bank5,666,073 5,587,757 
Common equity Tier 1 capital ratio (transitional)   
CET1 capital ratioCET1 capital ratio
Synovus Financial Corp.10.06% 9.96
Synovus Financial Corp.9.49 %9.50 %
Synovus Bank11.59
 11.97
Synovus Bank10.73 10.83 
Tier 1 capital ratio   
Tier 1 risk-based capital ratioTier 1 risk-based capital ratio
Synovus Financial Corp.10.43
 10.07
Synovus Financial Corp.10.63 10.66 
Synovus Bank11.59
 11.97
Synovus Bank10.73 10.83 
Total risk-based capital to risk-weighted assets ratio   Total risk-based capital to risk-weighted assets ratio
Synovus Financial Corp.12.30
 12.01
Synovus Financial Corp.12.56 12.61 
Synovus Bank12.52
 12.93
Synovus Bank12.00 12.11 
Leverage ratio   Leverage ratio
Synovus Financial Corp.9.34
 8.99
Synovus Financial Corp.8.87 8.72 
Synovus Bank10.40
 10.68
Synovus Bank8.95 8.86 
Tangible common equity to tangible assets ratio (1)
   
Tangible common equity ratio(1)
Tangible common equity ratio(1)
Synovus Financial Corp.8.88
 9.09
Synovus Financial Corp.6.80 7.52 
   
(1)See ""Table 14 - Reconciliation of Non-GAAP Financial Measures"Measures” in this Report for the applicable reconciliation to the most comparable GAAP measure.
The Basel III capital rules became effective January 1, 2015, for Synovus and Synovus Bank, subject to a transition period for several aspects,At March 31, 2022, Synovus' CET1 ratio was 9.49%, well in excess of regulatory requirements including the capital conservation buffer of 2.5%. The March 31, 2022 CET1 ratio declined 1 bp compared to December 31, 2021, driven by significant growth in risk-weighted assets, largely from loan growth, and certainreturn of capital through common stock shareholder dividends and share repurchases, mostly offset by strong capital generation from earnings. For additional information on regulatory capital adjustmentsrequirements, see "Part II - Item 8. Financial Statements and deductions, as described below. UnderSupplementary Data - Note 10 - Regulatory Capital" to the Basel IIIconsolidated financial statements of Synovus' 2021 Form 10-K. Management reviews the Company's capital rules, the minimumposition on an on-going basis and believes, based on internal capital requirements foranalyses and earnings projections, that Synovus and Synovus Bank include a common equity Tier 1 (CET1) ratio of 4.5%; Tier 1 capital ratio of 6%; total capital ratio of 8%; and leverage ratio of 4%. When fully phased-in on January 1, 2019, the Basel III capital rules include a capital conservation buffer of 2.5% that is added on top of each of the minimum risk-based capital ratios. The implementation of the capital conservation buffer began on January 1, 2016 at the 0.625% level and will be phased-in over a three-year period (increasing by that amount on each subsequent January 1, until it reaches 2.5% on January 1, 2019). As a financial holding company, Synovus and its subsidiary bank, Synovus Bank, are required to maintain capital levels required for a well-capitalized institution as defined by federal banking regulations. Under the Basel III capital rules, Synovus and Synovus Bank are well-capitalized if each has a CET1 ratio of 6.5% or greater, a Tier 1 risk-based capital ratio of 8% or greater, a total risk-based capital ratio of 10% or greater, a leverage ratio of 5% or greater, and are not subject to any written agreement, order, capital directive, or prompt corrective action directive from a federal and/or state banking regulatory

agencywell positioned to meet and maintain a specificrelevant regulatory capital level for any capital measure.standards.
During the nine months ended September 30, 2017,On January 20, 2022, Synovus repurchased $135.9 million in common stock under the current share repurchase program which was authorized during the fourth quarter of 2016 by Synovus'announced that its Board of Directors. The current share repurchase programDirectors authorized share repurchases of up to $200$300 million in 2022. During the three months ended March 31, 2022, Synovus repurchased a total of the Company's$9.7 million, or 204 thousand shares of its common stock, at an average price of $47.48 per share.
On August 26, 2020, the federal banking regulators issued a final rule (following an interim final rule issued on March 27, 2020) that allowed electing banking organizations that adopt CECL during 2020 to be executed during 2017. Asmitigate the estimated effects of September 30, 2017 and November 2, 2017, the remaining authorization under this program was $64.1 million and $56.6 million, respectively.
As of September 30, 2017, total disallowed deferred tax assets were $112.7 million or 0.41% of risk-weighted assets compared to $218.3 million or 0.82% of risk-weighted assets at December 31, 2016. Disallowed deferred tax assetsCECL on regulatory capital for CET1 were $90.2 million at September 30, 2017 compared to $131.0 million at December 31, 2016, due totwo years, followed by a three-year phase-in transition period. Synovus adopted CECL on January 1, 2020 and the March 31, 2022 regulatory capital ratios reflect Synovus' election of the total disallowed deferred tax asset for thefive-year transition provision. At March 31, 2022, $43.7 million, or a cumulative 9 bps benefit to CET1, capital measure. Basel III revised the deferred tax asset limitation criteria effective January 1, 2015 and now includes the component of deferred tax assets arising from temporary timing differences in regulatory capital up to certain levels of CET1. Thus, the disallowed portion of deferred tax assets is comprised of net operating loss carryforwards and tax credit carryforwards. Synovus' deferred tax asset is projected to continue to decline, thus creating additional regulatory capital in future periods. See "Part II - Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations - Income Taxes" in Synovus' 2016 Form 10-K for more information on Synovus' net deferred tax asset.was deferred.
Synovus' CET1 ratio was 10.06% at September 30, 2017 under Basel III transitional provisions and the estimated fully phased-in CET1 ratio, as of September 30, 2017, was 9.88%, both of which are well in excess of regulatory requirements. See "Non-GAAP Financial Measures" in this Report for the applicable reconciliation to the most comparable GAAP measure.
Management currently believes, based on internal capital analysis and earnings projections, that Synovus' capital position is adequate to meet current and future regulatory minimum capital requirements. Synovus' 2017 DFAST results show that capital ratios remain above regulatory minimums throughout the forecast period in the severely adverse scenario. Synovus expects to announce its 2018 capital plan in January of 2018.
Dividends
Synovus has historically paid a quarterly cash dividend to the holders of its common stock. Management and the Board of Directors closely monitor current and projected capital levels, liquidity (including dividends from subsidiaries), financial markets and other economic trends, as well as regulatory requirements regarding the payment of dividends. During the first quarter of 2017, Synovus increased the quarterly common stock dividend by 25% to $0.15 per share effective with the quarterly dividend declared during the first quarter of 2017.
Synovus' ability to pay dividends on its capital stock, consisting of the common stock and the Series C Preferred Stock,preferred stock is primarily dependent upon dividends and distributions that it receives from its bank and non-banking subsidiaries, which are restricted by various regulations administered by federal and state bank regulatory authorities, as further discussed below in the section titled "Liquidity." During the nine months ended September 30, 2017, authorities.

47


Synovus Bank made upstream cash distributions to Synovus totaling $350.0 million including cashdeclared common stock dividends of $215.2 million. Additionally, during the nine months ended September 30, 2017, Synovus Securities made upstream cash distributions to Synovus of $10.0 million. For the year ended December 31, 2016, Synovus Bank paid upstream cash dividends to Synovus totaling $325.0$49.4 million, with $260.0 million paid during the first nine months of 2016.
    Synovus declared dividends of $0.45 and $0.36or $0.34 per common share, for the ninethree months ended September 30, 2017 and 2016, respectively.March 31, 2022, compared to $49.1 million, or $0.33 per common share, for the three months ended March 31, 2021. In addition, toSynovus declared dividends paid on its commonpreferred stock Synovus paid dividends of $7.7$8.3 million on its Series C Preferred Stock during both the ninethree months ended September 30, 2017March 31, 2022 and 2016.2021.
Liquidity
Liquidity represents the extent to which Synovus has readily available sources of funding needed to meet the needs of depositors, borrowers and creditors, to support asset growth, and to otherwise sustain operations of Synovus and its subsidiaries, at a reasonable cost, on a timely basis, and without adverse consequences. ALCO monitors Synovus' economic, competitive, and regulatory environment and is responsible for measuring, monitoring, and reporting on liquidity and funding risk interest rate risk,as well as market risk.
In accordance with Synovus policies and market risk and has the authority to establish policies relative to these risks.regulatory guidance, ALCO operating under liquidity and funding policies approved by the Board of Directors, actively analyzesevaluates contractual and anticipated cash flows in order to properly manage Synovus’ liquidity position.
Contractual and anticipated cash flows are analyzed under normal and stressed conditions to determine forward lookingproperly manage the Company’s liquidity needs and sources.profile. Synovus analyzes liquidity needs under various scenarios of market conditions and operating performance. This analysis includes stress testing and measures expected sources and uses of funds under each scenario. Emphasis

is placedplaces an emphasis on maintaining numerous sources of current and potentialcontingent liquidity to allow Synovus to meet its obligations to depositors, borrowers, and creditors on a timely basis.
Liquidity is generated primarily through various sources, including, but not limited to, maturities and repayments of loans by customers,clients, maturities and sales of investment securities, depositand growth in core and access to sources of funds other than deposits. Management continuously monitors and maintains appropriate levels of liquidity so as to provide adequate funding sources to manage customer deposit withdrawals, loan requests, and funding maturities. Liquidity is also enhanced by the acquisition of new deposits. Each of the banking divisions monitors deposit flows and evaluates local market conditions in an effort to retain and growwholesale deposits.
Synovus Bank also generates liquidity through the national deposit markets through the issuance of brokered certificates of deposit and money market accounts. Synovus Bank accesses these funds from a broad geographic base to diversify its sources of funding and liquidity. On September 25, 2017, Synovus Bank completed the Cabela's Transaction and thereby retained WFB’s $1.10 billion brokered time deposit portfolio with a weighted average remaining maturity of approximately 2.53 years and a weighted average rate of 1.83 percent.
Synovus Bankalso has the capacity to access funding through its membership in the FHLB System.system and through the Federal Reserve discount window. At September 30, 2017,March 31, 2022, based on currently pledged collateral, Synovus Bank had access to incrementalFHLB funding of $667 million,of $5.52 billion, subject to FHLB credit policies, through utilizationpolicies. Management continuously monitors and maintains appropriate levels of FHLB advances.liquidity so as to provide adequate funding sources to manage client deposit withdrawals, loan requests, and other funding demands.
In addition to bank level liquidity management, Synovus must manage liquidity at the parent company level for various operating needs including the servicing of debt, the payment of dividends on our common stock and preferred stock, share repurchases, payment of general corporate expensesexpense, and potential capital infusions into subsidiaries. The primary source of liquidity for Synovus consists of dividends from Synovus Bank, which is governed by certain rules and regulations of the GA DBF and the Federal Reserve Bank. During the nine months ended September 30, 2017, Synovus Bank made upstream cash distributions to Synovus totaling $350.0 million including cash dividends of $215.2 million. Additionally, during the nine months ended September 30, 2017, Synovus Securities made upstream cash distributions to Synovus of $10.0 million. For the year ended December 31, 2016, Synovus Bank paid upstream cash dividends to Synovus totaling $325.0 million with $260.0 million paid during the first nine months of 2016.
Synovus' ability to receive dividends from Synovus Bank in future periods will depend on a number of factors, including, without limitation, Synovus Bank's future profits, asset quality, liquidity, and overall condition. In addition, both the GA DBF rules and relatedFederal Reserve Bank may require approval to pay dividends, based on certain regulatory statutes contain limitations on payments of dividends by Synovus Bank without the approval of the GA DBF. During the second quarter, Synovus paid off the remaining balance of $278.6 million of its subordinated notes at their maturity date of June 15, 2017. On September 25, 2017, Synovus issued a notice of redemption to redeem all of the $300.0 million aggregate principal amount of its outstanding 7.875% senior notes due 2019 on November 9, 2017 at a “make whole” premium, plus accrued but unpaid interest on the 2019 notes to the redemption date.  The results for the three months ending December 31, 2017 will include a pre-tax loss of approximately $24 million related to early extinguishment of these notes. On November 1, 2017, Synovus completed a public offering of $300.0 million of 3.125% senior notes due 2022. Proceeds from this offering will be used, in part, to fund the redemption of the 2019 notes. and limitations.
Synovus presently believes that the sources of liquidity discussed above, including existing liquid funds on hand, are sufficient to meet its anticipated funding needs. However, if economic conditions were to significantly deteriorate, regulatory capital requirements for Synovus or Synovus Bank were to increase as the result of regulatory directives or otherwise, or Synovus believes it is prudent to enhance current liquidity levels, then Synovus may seek additional liquidity from external sources. See "Part I – Item 1A. Risk Factors - Changes in the cost and availability of funding due to changes in the deposit market and credit market may adversely affect our capital resources, liquidity and financial results.results" ofSynovus' 20162021 Form 10-K. Furthermore, Synovus may, from time to time, take advantage of attractive market opportunities to refinance its existing debt, redeem its preferred stock, or strengthen its liquidity or capital position.
Earning Assets and Sources of Funds
Average total assets for the ninethree months ended September 30, 2017March 31, 2022 increased $1.35$2.67 billion, or 4.6%5%, to $30.58 billion as compared to $29.24 billion for the first ninethree months of 2016.2021. Average earning assets increased $1.43$3.02 billion, or 5.2%6%, in the first ninethree months of 20172022 compared to the same period in 2016 and represented 93.8% of average total assets at September 30, 2017, as compared to 93.2% at September 30, 2016.2021. The increase in average earning assets primarily resulted from a $1.41$2.82 billion, or 33%, increase in average investment securities available for sale and a $1.14 billion, or 3%, increase in average total loans, net of unearned, which included a decrease of $1.96 billion in PPP loans. The increase in average loans net,was primarily due to growth in commercial production and a $284.6 million increase in average taxable investment securities.line utilization. These increases were partially offset by a $309.4$868.4 million, or 32%, decrease in average interest bearinginterest-bearing funds held at the Federal Reserve Bank. Bank and a $206.8 million decrease in average loans held for sale.
Average interest bearinginterest-bearing liabilities increased $981.4decreased $40.5 million or 5.1%, to $20.14 billion for the first ninethree months of 20172022 compared to the same period in 2016.2021. The decrease in average interest-bearing liabilities resulted from a $1.15 billion, or 28%, decrease in average time deposits, as a result of continued focus on remixing the deposit base, a $581.2 million, or 17%, decrease in average brokered deposits, which was driven by Synovus' efforts to efficiently manage its liquidity position, and a $220.2 million, or 18%, decrease in average long-term debt, which includes redemption of $400 million in 2.289% Fixed-to-Floating Rate Senior Bank Notes in the first quarter of 2022. These decreases were mostly offset by a $978.8 million, or 11%, increase in average interest bearing liabilities was driven by a $594.7 million increase in average interest bearinginterest-bearing demand deposits, and a $434.1$696.7 million, or 5%, increase in average money market deposit accounts.deposits, and a $241.4 million, or 20%, increase in average savings deposits. Average non-interest bearing demandnon-interest-bearing deposits increased $331.1 million,$2.70 billion, or 4.8%20%, to $7.26 billion for the first nine three

48


months of 20172022 compared to the same period in 2016.2021. The aforementioned deposit increases were largely due to liquidity associated with various stimulus efforts and monetary policy.
Net interest income for the ninethree months ended September 30, 2017March 31, 2022 was $753.6$392.2 million, an increase of $87.9up $18.4 million, or 13.2%,5% compared to $665.7the same period in 2021, including $6.9 million for the nine months ended September 30, 2016.

The netin PPP fees during 2022 and $24.9 million in 2021. Net interest margin was 3.52% fordown 4 bps over the ninecomparablethree-month period to 3.00%, due primarily to the $18.0 million decline in PPP fees. For the three months ended September 30, 2017, an increase of 25 basis points from 3.27% forMarch 31, 2022, the nine months ended September 30, 2016. The yield on earning assets was 3.99%3.18%, up 27 basis pointsa decrease of 14 bps compared to the first ninethree months of 2016 andended March 31, 2021, while the effective cost of funds increased 2 basis pointsdecreased 10 bps to 0.47%0.18%. TheCompared to the same period in 2021, the yield on loans was 4.37%, an increase of 23 basis points fromdecreased 26 bps due primarily to the nine months ended September 30, 2016 anddecline in PPP fees, while the yield on investment securities was 2.10%, an increase of 22 basis points fromincreased 28 bps primarily due to higher reinvestment yield and deceleration in prepayment activity compared to the nine months ended September 30, 2016. Earning asset yields also benefited from a reduction of the average balance of lower yielding funds held at the Federal Reserve.prior year.
On a sequential quarter basis, net interest income increasedwas flat, with the first quarter of 2022 impacted by $11.5 millionlower PPP fees and the net interest margin increased by 12 basis points to 3.63%. The increase ina lower day count. Excluding these impacts, net interest income was driven by a $75.5 million increase in average earning assets with a $149.7 million increase in average loans, net. This increase in loans was partially offset by a $58.3 million decrease in average taxable investment securities. The increase in netup $12.7 million. Net interest incomemargin for the first quarter was also driven by3.00%, which was up 4 bps compared to the fourth quarter of 2021 with lower cash balances helping support the margin expansion.and offset the impact of the continued decline in PPP fees. The first quarter of 2022 included $6.9 million recognized for associated PPP fees versus $12.7 million in the fourth quarter of 2021 and average PPP loan balances of $282.4 million versus $578.6 million in the fourth quarter of 2021. For the first quarter of 2022, the yield on earning assets was 4.11%, up 12 basis points fromincreased 2 bps, while the second quarter of 2017. This increase was driven by a 13 basis point increase in loan yields. The effective cost of funds was 0.48% fordecreased 2 bps compared to the third quarter 2017, unchanged from the secondfourth quarter of 2017.2021.

We continue to expect that net interest income and net interest margin will increase in the coming quarters as the benefits of higher market interest rates are realized.
Quarterly yields earned on average interest-earning assets and rates paid on average interest-bearing liabilities for the five most recent quarters are presented below.
Average Balances, Interest, and Yields2017 2016
(dollars in thousands) (yields and rates annualized)Third Quarter Second Quarter First Quarter Fourth Quarter Third Quarter
Interest Earning Assets:         
Taxable investment securities (1)
$3,786,436
 3,844,688
 3,841,556
 3,643,510
 3,544,933
Yield2.11% 2.11% 2.06% 1.92
 1.83
Tax-exempt investment securities(1)(3)
$259
 340
 2,730
 2,824
 2,943
Yield (taxable equivalent) (3)
7.86% 6.87
 5.81
 5.82
 5.96
Trading account assets$7,823
 3,667
 6,443
 6,799
 5,493
Yield2.09% 2.28
 1.72
 2.63
 0.93
Commercial loans(2)(3)
$19,059,936
 19,137,733
 19,043,384
 18,812,659
 18,419,484
Yield4.41% 4.27
 4.16
 4.05
 4.03
Consumer loans(2)
$5,440,765
 5,215,258
 4,992,683
 4,911,149
 4,720,082
Yield4.55% 4.49
 4.40
 4.27
 4.30
Allowance for loan losses$(249,248) (251,219) (253,927) (253,713) (255,675)
    Loans, net (2)
$24,251,453
 24,101,772
 23,782,140
 23,470,095
 22,883,891
Yield4.49% 4.36
 4.25
 4.14
 4.14
Mortgage loans held for sale$52,177
 52,224
 46,554
 77,652
 87,524
Yield3.88% 3.87
 4.01
 3.51
 3.32
Federal funds sold, due from Federal Reserve Bank, and other short-term investments$543,556
 561,503
 654,322
 982,355
 998,565
Yield1.23% 1.00
 0.77
 0.49
 0.48
Federal Home Loan Bank and Federal Reserve Bank Stock(4)
$175,263
 177,323
 170,844
 121,079
 70,570
Yield3.50% 2.99% 3.42
 3.75
 4.99
Total interest earning assets$28,816,967
 28,741,517
 28,504,589
 28,304,314
 27,593,919
Yield4.11% 3.99
 3.88
 3.73
 3.71
Interest Bearing Liabilities:         
Interest bearing demand deposits$4,868,372
 4,837,053
 4,784,329
 4,488,135
 4,274,117
Rate0.27% 0.23
 0.19
 0.16
 0.16
Money Market accounts, excluding brokered deposits$7,528,036
 7,427,562
 $7,424,627
 7,359,067
 7,227,030
Rate0.34% 0.32
 0.31
 0.29
 0.29
Savings deposits$803,184
 805,019
 909,660
 908,725
 797,961
Rate0.03% 0.04
 0.11
 0.12
 0.07
Time deposits under $100,000$1,183,582
 1,202,746
 1,215,593
 1,229,809
 1,248,294
Rate0.68% 0.67
 0.64
 0.64
 0.64
Time deposits over $100,000$2,067,347
 2,040,924
 2,029,713
 2,014,564
 2,030,242
Rate0.97% 0.94% 0.92
 0.90
 0.88
Non-maturing brokered deposits$547,466
 564,043
 619,627
 638,779
 634,596
Rate0.73% 0.54
 0.41
 0.31
 0.29
Brokered time deposits$983,423
 815,515
 761,159
 742,153
 775,143
Rate1.16% 0.94
 0.92
 0.90
 0.88
   Total interest bearing deposits$17,981,410
 17,692,862
 17,744,708
 17,381,232
 16,987,383
Rate0.46% 0.41
 0.39
 0.37
 0.37
Federal funds purchased and securities sold under repurchase agreements$191,585
 183,400
 176,854
 219,429
 247,378
Rate0.08% 0.10
 0.09
 0.08
 0.09
Long-term debt$1,985,175
 2,270,452
 2,184,072
 2,190,716
 2,114,193
Rate2.81% 2.83
 2.83
 2.65
 2.71
Total interest bearing liabilities$20,158,170
 20,146,714
 20,105,634
 19,791,377
 19,348,954

Rate0.69% 0.68
 0.65
 0.62
 0.63
Non-interest bearing demand deposits$7,305,508
 7,298,845
 7,174,146
 7,280,033
 $7,042,908
Effective cost of funds0.48% 0.48
 0.46
 0.44
 0.44
Net interest margin3.63% 3.51
 3.42
 3.29
 3.27
Taxable equivalent adjustment (3)
$283
 298
 309
 322
 $330
          
(1) Excludes net unrealized gains (losses).
(2) Average loans are shown net of deferred fees and costs. Non-performing loans are included.
(3) Reflects taxable-equivalent adjustments, using the statutory federal income tax rate of 35%, in adjusting interest on tax-exempt loans and investment securities to a taxable-equivalent basis.
(4) Included as a component of Other Assets on the balance sheet.

Net Interest Income and Rate/Volume Analysis
The following tables settable sets forth the major components of net interest income and the related annualized yields and rates for the ninethree months ended September 30, 2017March 31, 2022 and 2016,2021, as well as the variances between the periods caused by changes in interest rates versus changes in volume.
Net Interest Income and Rate/Volume Analysis
 Nine Months Ended September 30, 2017 Compared to 2016
 Average Balances Interest Annualized Yield/Rate Change due to Increase (Decrease)
(dollars in thousands)2017 2016 2017 2016 2017 2016 Volume Rate 
Assets                 
Interest earning assets:                 
Taxable investment securities$3,824,025
 3,537,060
 $60,079
 49,820
 2.09% 1.88
 $4,035
 6,224
 $10,259
Tax-exempt investment securities(2)
1,101
 3,506
 51
 162
 6.13
 6.16
 (111) —
 (111)
Total investment securities3,825,126
 3,540,566
 60,130
 49,982
 2.10
 1.88
 3,924
 6,224
 10,148
Trading account assets5,983
 4,840
 90
 46
 1.99
 1.28
 11
 33
 44
Taxable loans, net(1)
24,227,567
 22,812,346
 783,546
 698,657
 4.32
 4.09
 43,293
 41,596
 84,889
Tax-exempt loans, net(1)(2)
70,721
 74,691
 2,492
 2,591
 4.71
 4.63
 (138) 39
 (99)
Allowance for loan losses(251,448) (254,960)              
Loans, net24,046,840
 22,632,077
 786,038
 701,248
 4.37
 4.14
 43,155
 41,635
 84,790
Mortgage loans held for sale50,339
 74,494
 1,478
 1,966
 3.91
 3.52
 (636) 148
 (488)
Federal funds sold, due from Federal Reserve Bank, and other short-term investments586,055
 930,954
 4,396
 3,343
 0.99
 0.48
 (1,212) 2,265
 1,053
Federal Home Loan Bank and Federal Reserve Bank stock174,493
 76,252
 4,321
 2,649
 3.30
 4.63
 3,402
 (1,730) 1,672
  Total interest earning assets$28,688,836
 27,259,183
 $856,453
 759,234
 3.99% 3.72
 $48,644
 48,575
 $97,219
Cash and due from banks391,829
 400,222
              
Premises and equipment, net416,835
 434,889
              
Other real estate20,246
 39,282
              
Other assets(3)
1,066,863
 1,103,504
              
Total assets$30,584,609
 29,237,080
              
                  
Liabilities and Shareholders' Equity                
Interest-bearing liabilities:                 
Interest-bearing demand deposits$4,830,226
 4,235,529
 $8,366
 5,420
 0.23% 0.17% $756
 2,190
 $2,946
Money market accounts8,037,235
 7,603,136
 20,268
 17,620
 0.34
 0.31
 1,007
 1,641
 2,648
Savings deposits838,898
 755,608
 394
 366
 0.06
 0.06
 37
 (9) 28
Time deposits4,100,836
 4,094,525
 26,846
 24,666
 0.88
 0.80
 37
 2,143
 2,180
Federal funds purchased and securities sold under repurchase agreements184,000
 215,641
 125
 154
 0.09
 0.09
 (21) (8) (29)
Long-term debt2,145,838
 2,251,235
 45,967
 44,394
 2.82
 2.59
 (2,073) 3,646
 1,573
Total interest-bearing liabilities$20,137,033
 19,155,674
 $101,966
 92,620
 0.68
 0.64
 $(257) 9,603
 $9,346
Non-interest bearing deposits7,259,981
 6,928,906
              
Other liabilities219,388
 203,989
              
Shareholders' equity2,968,207
 2,948,511
              
Total liabilities and equity$30,584,609
 29,237,080
              
Interest rate spread:        3.31
 3.08
      
Net interest income - FTE/margin(4)
    754,487
 666,614
 3.52% 3.27
 $48,901
 38,972
 $87,873
Taxable equivalent adjustment    890
 964
          
  Net interest income, actual    $753,597
 665,650
          
                  

49


Table 12 - Net Interest Income and Rate/Volume Analysis
Three Months Ended March 31,2022 Compared to 2021
Average BalancesInterestAnnualized Yield/RateChange due toIncrease (Decrease)
(dollars in thousands)202220212022202120222021VolumeRate
Assets
Interest earning assets:
Investment securities available for sale$11,259,800 $8,437,563 $47,250 $29,458 1.68 %1.40 %$9,742 $8,050 $17,792 
Trading account assets9,078 3,063 39 22 1.73 2.81 42 (25)17 
Commercial loans (1) (2)
30,756,752 29,924,651 280,588 291,200 3.70 3.95 8,104 (18,716)(10,612)
Consumer loans (1)
8,594,009 8,287,616 81,368 82,065 3.81 3.83 2,894 (3,591)(697)
Allowance for loan losses(423,953)(599,872)
Loans, net38,926,808 37,612,395 361,956 373,265 3.76 4.02 10,998 (22,307)(11,309)
Mortgage loans held for sale103,887 246,962 882 1,657 3.40 2.68 (945)170 (775)
Other loans held for sale597,062 660,753 5,300 4,805 3.55 2.91 (457)952 495 
Other earning assets(3)
1,919,531 2,838,063 815 716 0.17 0.10 (204)303 99 
Federal Home Loan Bank and Federal Reserve Bank stock160,065 157,657 685 668 1.71 1.69 10 7 17 
Total interest earning assets52,976,231 49,956,456 416,927 410,591 3.18 3.32 19,186 (12,850)6,336 
Cash and due from banks548,684 518,738 
Premises, equipment, and software, net398,774 460,466 
Other real estate11,759 1,823 
Cash surrender value of bank-owned life insurance1,070,886 1,051,520 
Other assets(4)
1,849,564 2,199,501 
Total assets$56,855,898 $54,188,504 
Liabilities and Shareholders' Equity
Interest-bearing liabilities:
Interest-bearing demand deposits$9,549,527 $8,570,753 2,372 2,973 0.10 0.14 338 (939)(601)
Money market accounts16,045,627 15,348,916 5,349 8,730 0.14 0.23 395 (3,776)(3,381)
Savings deposits1,460,648 1,219,288 67 49 0.02 0.02 12 6 18 
Time deposits3,009,795 4,155,302 2,138 7,042 0.29 0.69 (1,949)(2,955)(4,904)
Brokered deposits2,788,124 3,369,333 3,733 6,224 0.54 0.75 (1,075)(1,416)(2,491)
Federal funds purchased and securities sold under repurchase agreements194,352 209,448 11 34 0.02 0.07 (3)(20)(23)
Other short-term borrowings4,653 — — — — — — — — 
Long-term debt982,423 1,202,613 10,144 10,908 4.13 3.63 (1,971)1,207 (764)
Total interest-bearing liabilities34,035,149 34,075,653 23,814 35,960 0.28 0.42 (4,253)(7,893)(12,146)
Non-interest-bearing deposits16,491,643 13,791,286 
Other liabilities1,144,535 1,185,344 
Shareholders' equity5,184,571 5,136,221 
Total liabilities and equity$56,855,898 $54,188,504 
Interest rate spread:2.90 %2.90 %
Net interest income - TE/margin(5)
$393,113 $374,631 3.00 %3.04 %$23,439 $(4,957)$18,482 
Taxable equivalent adjustment865 774 
  Net interest income, actual$392,248 $373,857 
(1)     Average loans are shown net of unearned income. Non-performing loansNPLs are included. Interest income includes fees as follows: 20172022 - $23.4$20.7 million, 20162021 - $23.4$31.9 million.
(2)Reflects taxable-equivalent adjustments, using the statutory federal income tax rate of 35%21%, in adjusting interest on tax-exempt loans and investment securities to a taxable-taxable-equivalent basis.
equivalent basis.(3)    Includes interest-bearing funds with Federal Reserve Bank, interest earning deposits with banks, and federal funds sold and securities purchased under resale agreements.
(3)(4)    Includes average net unrealized gains (losses) on investment securities available for sale of $(34.7)$(247.4) million and $35.7$116.1 million for the ninethree months ended September 30, 2017March 31, 2022 and 2021, respectively.
2016, respectively.
(4)(5)    The net interest margin is calculated by dividing annualized net interest income - FTETE by average total interest earnings assets.


50


Market Risk Analysis
Interest rate risk is the primary market risk to which Synovus is potentially exposed. Synovus measures its sensitivity to changes in market interest rates through the use of a simulation model. Synovus uses this simulation model which incorporates all of Synovus’ earning assets and liabilities. These simulations are used to determine a baseline net interest income forecastprojection and the sensitivity of this forecast tothe income profile based on changes in interest rates. These simulations include allincorporate assumptions and factors, including, but not limited to, changes in market rates, in the size or composition of Synovus’ earning assets and liabilities. Forecastedthe balance sheet, changes, primarily reflecting loan and deposit growth forecasts, are included in the periods modeled. Anticipated deposit mix changesrepricing characteristics as well as client behaviors. This process is reviewed and updated on an on-going basis in each interest rate scenario are also included in the periods modeled.a manner consistent with Synovus’ ALCO governance framework.
Synovus has modeled its baseline net interest income forecast assuming a relatively flat interest rate environment with the federal funds rate at the Federal Reserve’s current targeted range of 1.00%0.25% to 1.25%0.50% and the current prime rate of 4.25%3.50%. Synovus has modeled the impact of a gradualan immediate increase in short-termmarket interest rates across the yield curve of 100 and 200 basis points and a decline of 25 basis pointsbps to determine the sensitivity of net interest income for the next twelve months. Synovus continues to maintain a modestly asset sensitiveSynovus' current rate risk position whichis considered asset-sensitive and would be expected to benefit net interest income in a rising interest rate environment and reduce net interest income in a declining interest rate environment. The following table represents the estimated sensitivity of net interest income to these changes in short-term interest rates at September 30, 2017,March 31, 2022, with comparable information for December 31, 2016.2021.
   Estimated % Change in Net Interest Income as Compared to Unchanged Rates (for the next twelve months)
 
 Change in Short-term Interest Rates (in basis points) September 30, 2017 December 31, 2016
 +200 4.9% 4.6%
 +100 2.9% 2.2%
 Flat —% —%
 -25 -1.5% -2.3%
      
Several factors could serve to diminish or eliminate this asset sensitivity in a rising rate environment. These factors include a higher than projected level of deposit customer migration to higher cost deposits, such as certificates of deposit, which would increase total interest expense and serve to reduce the realized level of asset sensitivity. Another factor which could impact the realized interest rate sensitivity is the repricing behavior of interest bearing non-maturity deposits. Assumptions for repricing are expressed as a beta relative to the change in the prime rate. For instance, a 50% beta would correspond to a deposit rate that would increase 0.5% for every 1% increase in the prime rate. Projected betas for interest bearing non-maturity deposit repricing are a key component of determining the Company's interest rate risk positioning. Projected betas are based on historical analysis, current product features, and deposit mix. These projected betas reflect an assumption that realized betas will increase as short-term rates increase. Should realized betas be higher than projections, the expected benefit from higher interest rates would be diminished. The following table presents an example of the potential impact of an increase in repricing betas on Synovus' realized interest rate sensitivity position.
Table 13 - Twelve Month Net Interest Income SensitivityTable 13 - Twelve Month Net Interest Income Sensitivity
Estimated % Change in Net Interest Income as Compared to Unchanged Rates (for the next twelve months)
 As of September 30, 2017
Change in Short-term Interest Rates (in basis points) Base Scenario 15% Increase in Average Repricing Beta
Change in Interest Rates (in bps)Change in Interest Rates (in bps)March 31, 2022December 31, 2021
+200 4.9% 3.1%+20013.5%14.5%
+100 2.9% 2.1%+1006.4%6.5%
 
The net interest income simulation model is the primary tool utilized to evaluate potential interest rate risks over a shorter termshorter-term time horizon. Synovus also evaluates potential longer termlonger-term interest rate risk through modeling and evaluation of the sensitivity of the Company's EVE. Simulation modeling is utilized to measure the economic value of equity and its sensitivity to immediate changes in interest rates. These simulations value only the current balance sheet and do not incorporate growth assumptions used in the net interest income simulation. The economic value of equity isEVE measurement process estimates the net fair value of assets, liabilities, and off-balance sheet financial instruments derived from the present value of future cash flows discounted at current market interest rates. From this baseline valuation, Synovus evaluates changes in the value of each of these items inunder various interest rate scenariosscenarios. Management uses EVE sensitivity analyses as an additional means of measuring interest rate risk and incorporates this form of analysis within its governance and limits framework.
LIBOR Transition
On March 5, 2021, the FCA confirmed that all LIBOR settings will either cease to determine the net impactbe provided by any administrator or no longer be representative immediately after June 30, 2023, for all remaining US dollar settings.
The ARRC proposed SOFR as its preferred rate as an alternative to LIBOR and proposed a paced market transition plan to SOFR from LIBOR. Organizations are currently working on the economic valueindustry-wide and company-specific transition plans related to derivatives and cash markets exposed to LIBOR. As noted within "Part II - Item 1A. Risk Factors" of equity. Key assumptions utilized in the model, namely loan prepayments, investment security prepayments, deposit repricing betas, and non-maturity deposit duration have a significant impact on the results of the EVE simulations. As illustrated in the table below, the EVE model indicatesthis Report, Synovus holds instruments that compared with a valuation assuming stable rates, EVE is projected to increase by 2.6% and by 1.2%, assuming an immediate and sustained increase in interest rates of 100 and 200 basis points, respectively. Assuming an immediate 25 basis point decline in rates, EVE is projected to decrease by 3.2%. These metrics reflect a slight moderation in long term asset sensitivity as compared to December 31, 2016. This moderation is primarily due to an increase in the duration of the investment portfolio and a slight increase in loan duration.

  Estimated Change in EVE
Immediate Change in Interest Rates (in basis points) September 30, 2017 December 31, 2016
+200 1.2% 2.8%
+100 2.6% 3.2%
-25 -3.2% -3.3%
     
ADDITIONAL DISCLOSURES
Recently Issued Accounting Standards
Several accounting standards willmay be effective in fiscal year 2018 or later. Synovus is currently evaluating the requirements of these new ASUs to determine the impact on the consolidated financial statements:
ASU 2017-12, Derivatives and Hedging: Targeted Improvements to Accounting for Hedging Activities
ASU 2017-08, Receivables-Nonrefundable Fees and Other Costs: Premium Amortization on Purchased Callable Debt Securities
ASU 2017-05, Other Income-Gains and Losses from the Derecognition of Nonfinancial Assets, Clarifying the Scope of Asset Derecognition Guidance and Accounting for Partial Sales of Nonfinancial Assets
ASU 2017-04, Intangibles-Goodwill and Other, Simplifying the Test for Goodwill Impairment
ASU 2017-01, Business Combinations-Clarifying the Definition of a Business
ASU 2016-18, Statement of Cash Flows-Restricted Cash
ASU 2016-15, Statement of Cash Flows-Classification of Certain Cash Receipts and Cash Payments
ASU 2016-13, Financial Instruments-Credit Losses (CECL)
ASU 2016-02, Leases
ASU 2016-01, Financial Instruments-Overall: Recognition and Measurement of Financial Assets and Financial Liabilities
ASU 2014-09, Revenue from Contracts with Customers (Topic 606) and subsequent related Updates
The ASUs with the most significant impact on Synovus are ASU 2016-13, Financial Instruments-Credit Losses (CECL), effective in 2020, followedimpacted by the ASU 2014-09, Revenue from Contracts with Customers, effective in 2018,discontinuance of LIBOR, which include floating rate obligations, loans, deposits, derivatives and ASU 2016-02, Leases, effective in 2019.

ASU 2016-13, Financial Instruments-Credit Losses (CECL).In June 2016, the FASB issued new accounting guidance related to credit losses. The new guidance replaces the existing incurred loss impairment guidance with a single expected credit loss methodology. The new guidance will require management’s estimate of credit losses over the full remaining expected life of loanshedges, and other financial instruments. Synovus has established a cross-functional LIBOR transition working group with representation from all business lines, support and control functions, and legal counsel that has 1) assessed the Company's current exposure to LIBOR indexed instruments and the data, systems and processes that were impacted and have been changed as a result; 2) established a detailed implementation plan; 3) formulated communications and learning activities to support clients and colleagues; and 4) developed a formal governance structure for the transition. For Synovus, the standard will applylast several years, loan agreement provisions for new and renewed loans included LIBOR fallback language to loans, unfunded loan commitments,ensure transition from LIBOR when such transition occurs. All direct exposures resulting from existing financial contracts that mature after 2021 have been inventoried and debt securities available for sale.are monitored on an ongoing basis. The standard is effective for fiscal years beginning after December 15, 2019 and interim periods within those fiscal years.  Early adoption is permitted on January 1, 2019.  Upon adoption, Synovus expects to record a cumulative effect adjustment to retained earningsCompany discontinued the use of LIBOR as of December 31, 2021, with limited exceptions as permitted by regulatory guidance or internal policies. Synovus has expanded its product offerings and currently offers multiple alternative reference rates including SOFR, BSBY, and Prime indices. As of March 31, 2022, the beginningCompany had approximately $14 billion in loans tied to LIBOR that mature after June 30, 2023. Remediation activities are underway to modify or transition existing exposures to alternate index rates or to convert the rate under existing fallback language, including the use of the reporting period of adoption.  
Synovus' implementation efforts, which are led by a cross-functional steering committee, areAdjustable Interest (LIBOR) Act, enacted in process. To date, the focus of the committee has been on assessing the data, calculations, and disclosures required by the standard as well as working through the project plan to address these requirements and provide for the implementation of the new standard. Management expects that the allowance for loan losses will be higher under the new standard; however, management is still in the process of determining the magnitude of the increase and the impact on its financial statements and regulatory capital ratios. Additionally, the extent of the increase on the allowance for loan losses will depend upon the composition of the loan portfolio upon adoption of the standard, as well as economic conditions and forecasts at that time. 

ASU 2014-09, Revenue from Contracts with Customers (Topic 606) and subsequent related Updates. In May 2014, the FASB issued new accounting guidance for recognizing revenue from contracts with customers, which is effective on January 1, 2018. ASU 2014-09 and subsequent related updates establish a single comprehensive model for entities to use in accounting for revenue arising from contracts with customers and supersedes most current revenue recognition guidance, including industry-specific guidance. The standard is intended to increase comparability across industries. The core principle of the revenue model is that a company will recognize revenue when it transfers control of goods or services to customers at an amount that reflects the consideration to which it expects to be entitled in exchange for those goods or services. The scope of the guidance explicitly excludes net interest income as well as many other revenues from financial assets.
Synovus will adopt the new revenue recognition guidance in the first quarter of 2018 using the modified retrospective method with a cumulative-effect adjustment to opening retained earnings. Synovus has substantially completed its assessment of revenue

contracts. Based on this review, management has not identified material changes to the timing or amount of revenue recognition. In connection with the adoption of this standard, Synovus will provide new footnote disclosures beginning in the first quarter of 2018 Form 10-Q consisting of expanded disaggregated non-interest income disclosures. Synovus does not expect the new standard to have a material impact on its consolidated financial position, results of operations, or disclosures.

ASU 2016-02, Leases.In February 2016, the FASB issued its new standard on lease accounting. ASU 2016-02 introduces a lessee model that brings most leases on the balance sheet. Under the new standard, all lessees will recognize a right-of-use asset and a lease liability for all leases, including operating leases, with a lease term greater than 12 months. From a lessor perspective, the accounting model is largely unchanged. For Synovus, the impact of this ASU will predominately relate to its accounting and reporting of leases as a lessee. The new ASU will be effective for Synovus beginning January 1, 2019. A modified retrospective approach is required at adoption which requires all prior periods presented in the financial statements to be restated with a cumulative effect adjustment to retained earnings as of the beginning of the earliest period presented. The standard also requires additional disclosures regarding leasing arrangements.
Synovus is currently evaluating the potential financial statement impact from the implementation of this standard by reviewing its existing lease contractsMarch 2022, and other contracts that may include embedded leases. Synovus currently expects to recognize lease liabilities and corresponding right-of-use assets (at their present value) related to substantially all of the $282 million of future minimum lease commitments as disclosed in Note 8 of Synovus' 2016 Form 10-K. However, the population of contracts requiring balance sheet recognition and their initial measurement continues to be under evaluation.relevant legislation.
See "Note 1 - Significant Accounting Policies" in this Report for a discussion of recently adopted accounting standards updates.

51


Critical Accounting Policies
The accounting and financial reporting policies of Synovus are in accordance with GAAP and conform to the accounting and reporting guidelines prescribed by bank regulatory authorities. Synovus has identified certain of its accounting policies as “critical accounting policies,” consisting of those related to the allowance for loancredit losses and determination of the fair value of financial instruments.income taxes. In determining which accounting policies are critical in nature, Synovus has identified the policies that require significant judgment or involve complex estimates. It is management's practice to discuss critical accounting policies with the Board of Directors' Audit Committee on a periodic basis, including the development, selection, implementation and disclosure of the critical accounting policies. The application of these policies has a significant impact on Synovus’ unaudited interim consolidated financial statements. Synovus’ financial results could differ significantly if different judgments or estimates are used in the application of these policies. All accounting policies described in "Part II - Item 8. Financial Statements and Supplementary Data - Note 1 - Summary of Significant Accounting Policies" in Synovus' 20162021 Form 10-K should be reviewed for a greater understanding of how we record and report our financial performance. During the nine months ended September 30, 2017, thereThere have been no significant changes to Synovus’ criticalthe accounting policies, estimates and assumptions, or the judgments affecting the application of these estimates and assumptions from those disclosed in Synovus' 20162021 Form 10-K.

Non-GAAP Financial Measures
The measures entitled adjusted non-interest income;revenue; adjusted non-interest expense; adjusted total revenues;revenue; adjusted tangible efficiency ratio; adjusted net income per common share, diluted; adjusted return on average assets; adjusted net charge-off ratio; adjusted return on average common equity; adjusted return on average tangible common equity; average total deposit growth excluding WFB deposits; average core deposits; average core transaction deposits;and tangible common equity to tangible assets ratio; and common equity Tier 1 (CET1) ratio (fully phased-in); are not measures recognized under GAAP and therefore are considered non-GAAP financial measures. The most comparable GAAP measures to these measures are total non-interest income;revenue; total non-interest expense; total revenues;TE revenue; efficiency ratio;ratio-TE; net income per common share, diluted; return on average assets; net charge-off ratio; return on average common equity; average deposit growth; total average deposits;and the ratio of total shareholders' equity to total assets; and the CET1 ratio;assets, respectively.
Management believes that these non-GAAP financial measures provide meaningful additional information about Synovus to assist management and investors in evaluating Synovus’ operating results, financial strength, the performance of its business, and the strength of its capital position. However, these non-GAAP financial measures have inherent limitations as analytical tools and should not be considered in isolation or as a substitute for analyses of operating results or capital position as reported under GAAP. The non-GAAP financial measures should be considered as additional views of the way our financial measures are affected by significant items and other factors, and since they are not required to be uniformly applied, they may not be comparable to other similarly titled measures at other companies. Adjusted total revenuesrevenue and adjusted non-interest incomerevenue are measures used by management to evaluate total TE revenue and non-interest incomerevenue exclusive of net investment securities gains/losses, changes ingains (losses) and fair value of private equity investments, net, and the Cabela's Transaction Fee.adjustment on non-qualified deferred compensation. Adjusted non-interest expense and the adjusted tangible efficiency ratio are measures utilized by management to measure the success of expense management initiatives focused on reducing recurring controllable operating costs. Adjusted net income per common share, diluted, adjusted return on average assets, and adjusted return on average common equity are measurements used by management to evaluate operating results exclusive of items that management believes are not indicative of ongoing operations and impact period-to-period comparisons. Average total deposit growth excluding WFB deposits, average core deposits, and average core transaction deposits are measures used by management to evaluate organic growth of deposits and the quality of deposits as a funding source. Adjusted net charge-off ratio is a measure used by management to evaluate charge-offs exclusive of charge-offs on loans transferred to held-for-sale. The adjusted return on average tangible common equity is a measure used by management to compare Synovus' performance with other financial institutions because it calculates the return available to common shareholders without the impact of intangible assets and their related amortization, thereby allowing management to evaluate the performance of the business consistently. The tangible common equity to tangible assets ratio and common equity Tier 1 (CET1) ratio (fully phased-in) areis used by management and bank regulators to assess the strength of our capital position. The computations of these measures are set forth in the tables below.



52


Reconciliation of Non-GAAP Financial Measures

Nine Months Ended Three Months Ended Year Ended
(in thousands, except per share data)September 30, 2017 September 30, 2016 September 30, 2017 September 30, 2016 December 31, 2016
Adjusted non-interest income         
Total non-interest income$275,974
 199,188
 135,435
 68,155
 273,194
Subtract: Cabela's Transaction Fee(75,000) —
 (75,000) —
 —
Add/subtract: Investment securities (losses) gains, net289
 (126) 7,956
 (59) (6,011)
Add: Decrease in fair value of private equity investments, net3,193
 527
 27
 249
 1,026
     Adjusted non-interest income$204,456
 199,589
 68,418
 68,345
 268,209
          
Adjusted non-interest expense         
Total non-interest expense$594,780
 562,716
 205,646
 185,871
  
Subtract: Discounts to fair value for completed or planned ORE accelerated dispositions(7,082) —
 (7,082) —
  
Subtract: Asset impairment charges related to accelerated disposition of corporate real estate and other properties(1,168) —
 (1,168) —
  
Subtract: Earnout liability adjustments(2,059) —
 (2,059) —
  
Subtract: Restructuring charges, net(7,043) (8,225) (519) (1,243)  
Subtract: Fair value adjustment to Visa derivative—
 (1,079) —
 (360)  
Subtract: Litigation contingency/settlement expenses(401) (2,511) (401) 189
  
Subtract: Loss on early extinguishment of debt, net—
 (4,735) —
 —
  
Subtract: Amortization of intangibles(767) (121) (292) —
  
Subtract: Merger-related expense(110) (550) (23) (550)  
 Adjusted non-interest expense$576,150
 545,495
 194,102
 183,907
  
          

Table 14 - Reconciliation of Non-GAAP Financial Measures
Three Months Ended
(in thousands, except per share data)March 31, 2022March 31, 2021
Adjusted non-interest revenue
Total non-interest revenue$105,334 $110,956 
Subtract/add: Investment securities (gains) losses, net— 1,990 
Subtract/add: Fair value adjustment on non-qualified deferred compensation1,295 (792)
Adjusted non-interest revenue$106,629 $112,154 
Adjusted non-interest expense
Total non-interest expense$272,450 $267,134 
Subtract/add: Restructuring charges6,424 (531)
Subtract: Loss on early extinguishment of debt(677)— 
Subtract/add: Fair value adjustment on non-qualified deferred compensation1,295 (792)
Adjusted non-interest expense$279,492 $265,811 
Adjusted total revenue and adjusted tangible efficiency ratio
Adjusted non-interest expense$279,492 $265,811 
Subtract: Amortization of intangibles(2,118)(2,379)
Adjusted tangible non-interest expense$277,374 $263,432 
Net interest income$392,248 $373,857 
Add: Tax equivalent adjustment865 774 
Add: Total non-interest revenue105,334 110,956 
Total TE revenue$498,447 $485,587 
Subtract/add: Investment securities (gains) losses, net— 1,990 
Subtract/add: Fair value adjustment on non-qualified deferred compensation1,295 (792)
Adjusted total revenue$499,742 $486,785 
Efficiency ratio-TE54.66 %55.01 %
 Adjusted tangible efficiency ratio55.50 54.12 
Adjusted net income per common share, diluted
Net income available to common shareholders$162,746 $178,802 
Add/subtract: Restructuring charges(6,424)531 
Add: Loss on early extinguishment of debt677 — 
Subtract/add: Investment securities (gains) losses, net— 1,990 
Add/subtract: Tax effect of adjustments (1)
1,369 (638)
Adjusted net income available to common shareholders$158,368 $180,685 
Weighted average common shares outstanding, diluted146,665 149,780 
Adjusted net income per common share, diluted$1.08 $1.21 

53


Reconciliation of Non-GAAP Financial Measures, continued

Nine Months Ended Three Months Ended
(in thousands, except per share data)September 30, 2017 September 30, 2016 September 30, 2017 September 30, 2016
Adjusted efficiency ratio       
Adjusted non-interest expense$576,150
 545,495
 194,102
 183,907
Net interest income753,597
 665,650
 262,572
 226,007
Add: Tax equivalent adjustment890
 964
 283
 330
Add: Total non-interest income275,974
 199,188
 135,435
 68,155
Add/Subtract: Investment securities (losses) gains, net289
 (126) 7,956
 (59)
Total FTE revenues1,030,750
 865,676
 406,246
 294,433
Subtract: Cabela's Transaction Fee(75,000) —
 (75,000) —
Add: Decrease in fair value of private equity investments, net3,193
 527
 27
 249
Adjusted total revenues$958,943
 866,203
 331,273
 294,682
Efficiency ratio57.70% 65.00
 50.62
 63.13
      Adjusted efficiency ratio60.08
 62.98
 58.59
 62.41
        
Adjusted net income per common share, diluted       
Net income available to common shareholders$238,190
 170,555
 95,448
 62,686
Add:Earnout liability adjustments2,059
 —
 2,059
 —
Add: Merger-related expense110
 550
 23
 550
Add: Fair value adjustment to VISA derivative—
 1,079
 —
 360
Add/subtract: Litigation contingency/recovery401
 2,511
 401
 (189)
Add: Restructuring charges7,043
 8,225
 519
 1,243
Add: Amortization of intangibles767
 121
 292
 —
Add: Loss on early extinguishment of debt, net—
 4,735
 —
 —
Add: Provision expense on loans transferred to held-for-sale27,710
 —
 27,710
 —
Add: Discounts to fair value for completed or planned ORE accelerated dispositions7,082
 —
 7,082
 —
Add: Asset impairment charges related to accelerated disposition of corporate real estate and other properties1,168
 —
 1,168
 —
Add/subtract: Investment securities (losses) gains, net289
 (126) 7,956
 (59)
Add: Decrease in fair value of private equity investments, net3,193
 527
 27
 249
Subtract: Cabela's Transaction Fee(75,000) —
 (75,000) —
Add/subtract: Tax effect of adjustments10,078
 (6,520) 11,034
 (797)
Adjusted net income$223,090
 181,657
 78,719
 64,043
Weighted average common shares outstanding122,628
 125,712
 121,814
 123,604
Adjusted net income per common share, diluted$1.82
 1.45
 0.65
 0.52
        
Table 14 - Reconciliation of Non-GAAP Financial Measures, continued
Three Months Ended
(dollars in thousands)March 31, 2022March 31, 2021
Adjusted return on average assets (annualized)
Net income$171,037 $187,093 
Add/subtract: Restructuring charges(6,424)531 
Add: Loss on early extinguishment of debt677 — 
Subtract/add: Investment securities (gains) losses, net— 1,990 
Add/subtract: Tax effect of adjustments (1)
1,369 (638)
Adjusted net income$166,659 $188,976 
Net income annualized693,650 758,766 
Adjusted net income annualized675,895 766,403 
Total average assets56,855,898 54,188,504 
Return on average assets (annualized)1.22 %1.40 %
Adjusted return on average assets (annualized)1.19 1.41 


Three Months Ended
(dollars in thousands)March 31, 2022December 31, 2021March 31, 2021
Adjusted return on average common equity and adjusted return on average tangible common equity (annualized)
Net income available to common shareholders$162,746 $192,110 $178,802 
Add/subtract: Restructuring charges(6,424)5,958 531 
Add: Valuation adjustment to Visa derivative— 2,656 — 
Add: Loss on early extinguishment of debt677 — — 
Subtract/add: Investment securities (gains) losses, net— (230)1,990 
Add/subtract: Tax effect of adjustments (1)
1,369 (2,121)(638)
Adjusted net income available to common shareholders$158,368 $198,373 $180,685 
Adjusted net income available to common shareholders' annualized$642,270 $787,023 $732,778 
Add: Amortization of intangibles, annualized net of tax6,543 7,050 7,207 
Adjusted net income available to common shareholders excluding amortization of intangibles annualized$648,813 $794,073 $739,985 
Net income available to common shareholders annualized$660,025 $762,176 $725,141 
Total average shareholders' equity less preferred stock$4,647,426 $4,730,828 $4,599,076 
Subtract: Goodwill(452,390)(452,390)(452,390)
Subtract: Other intangible assets, net(34,576)(36,805)(44,005)
Total average tangible shareholders' equity less preferred stock$4,160,460 $4,241,633 $4,102,681 
Return on average common equity (annualized)14.20 %16.11 %15.77 %
Adjusted return on average common equity (annualized)13.82 16.64 15.93 
Adjusted return on average tangible common equity (annualized)15.59 18.72 18.04 

54


Reconciliation of Non-GAAP Financial Measures, continued

Nine Months Ended Three Months Ended 
(dollars in thousands)September 30, 2017 September 30, 2016 September 30, 2017 September 30, 2016 
         
Adjusted return on average assets (annualized)  
 
 
 
Net income$245,868
 178,233
 98,007
 65,245
 
Add: Earnout liability adjustments2,059
 —
 2,059
 —
 
Add: Merger-related expense110
 550
 23
 550
 
Add: Fair value adjustment to VISA derivative—
 1,079
 —
 360
 
Add/subtract: Litigation contingency/recovery401
 2,511
 401
 (189) 
Add: Restructuring charges7,043
 8,225
 519
 1,243
 
Add: Amortization of intangibles767
 121
 292
 —
 
Add: Loss on early extinguishment of debt, net—
 4,735
 —
 —
 
Add: Provision expense on loans transferred to held-for-sale27,710
 —
 27,710
 —
 
Add: Discounts to fair value for completed or planned ORE accelerated dispositions7,082
 —
 7,082
 —
 
Add: Asset impairment charges related to accelerated disposition of corporate real estate and other properties1,168
 —
 1,168
 —
 
Add/subtract: Investment securities (losses) gains, net289
 (126) 7,956
 (59) 
Add: Decrease in fair value of private equity investments, net3,193
 527
 27
 249
 
Subtract: Cabela's Transaction Fee(75,000) —
 (75,000) —
 
Add/subtract: Tax effect of adjustments10,078
 (6,520) 11,034
 (797) 
Adjusted net income$230,768
 189,335
 81,278
 66,602
 
Net income annualized308,536

252,907
 322,462
 264,960
 
Total average assets$30,584,607
 29,237,109
 30,678,388
 29,528,435
 
Adjusted return on average assets (annualized)1.01% 0.87
 1.05
 0.90
 
         
Adjusted net charge-off ratio (annualized)        
Net charge-offs$60,695
   38,099
   
Charge-offs on loans transferred to held-for-sale during 3Q17(34,235)   (34,235)   
Net-charges-offs excluding charge-offs on loans transferred to held-for-sale$26,460
   3,864
   
Net charge-offs excluding charge-offs on loans transferred to held-for-sale annualized35,377
   15,330
   
Average loan balances$24,297,002
   24,499,923
   
Net charge-off ratio, as reported (annualized)0.33%   0.62
   
Adjusted net charge-off ratio, excluding 3Q17 transfers to held-for-sale (annualized)0.15%   0.06
   
         
Table 14 - Reconciliation of Non-GAAP Financial Measures, continued
(dollars in thousands)March 31, 2022December 31, 2021March 31, 2021
Tangible common equity ratio
Total assets$56,419,549 $57,317,226 $55,159,011 
Subtract: Goodwill(452,390)(452,390)(452,390)
Subtract: Other intangible assets, net(33,478)(35,596)(42,733)
Tangible assets$55,933,681 $56,829,240 $54,663,888 
Total shareholders' equity$4,824,635 $5,296,800 $5,161,717 
Subtract: Goodwill(452,390)(452,390)(452,390)
Subtract: Other intangible assets, net(33,478)(35,596)(42,733)
Subtract: Preferred stock, no par value(537,145)(537,145)(537,145)
Tangible common equity$3,801,622 $4,271,669 $4,129,449 
Total shareholders' equity to total assets ratio8.55 %9.24 %9.36 %
Tangible common equity ratio6.80 7.52 7.55 
(1) An assumed marginal tax rate of 23.8% for 2022 and 25.3% for 2021 was applied.

Outlook 2017 (Yr)
Adjusted net charge-off ratio excluding balance sheet restructuring actions
Net charge-off ratio29-34 b.p.s
Subtract: Net charge-off ratio related to loans transferred to held-for-sale14 b.p.s
Net charge-off ratio, excluding transfers to held-for-sale15-20 b.p.s





Reconciliation of Non-GAAP Financial Measures, continuedThree Months Ended
(dollars in thousands)September 30, 2017 June 30, 2017 December 31, 2016 September 30, 2016 
Adjusted return on average common equity (annualized)        
Net income available to common shareholders$95,448
 73,444
 65,990
 62,686
 
Add:Earnout liability adjustments2,059
 —
 —
 —
 
Add: Merger-related expense23
 —
 1,086
 550
 
Add: Fair value adjustment to VISA derivative—
 —
 4,716
 360
 
Add/subtract: Litigation contingency/recovery401
 —
 —
 (189) 
Add: Restructuring charges519
 13
 42
 1,243
 
Add: Amortization of intangibles292
 292
 400
 —
 
Add: Provision expense on loans transferred to held-for-sale27,710
 —
 —
 —
 
Add: Discounts to fair value for completed or planned ORE accelerated dispositions7,082
 —
 —
 —
 
Add: Asset impairment charges related to accelerated disposition of corporate real estate and other properties1,168
 —
 —
 —
 
Add/subtract: Investment securities (losses) gains, net7,956
 1
 (5,885) (59) 
Add: Decrease in fair value of private equity investments, net27
 1,352
 499
 249
 
Subtract: Cabela's Transaction Fee(75,000) —
 —
 —
 
Add/subtract: Tax effect of adjustments11,034
 (613) (318) (797) 
Adjusted net income$78,719
 74,489
 66,530
 64,043
 
Net income annualized$312,309
 298,775
 264,674
 254,780
 
         
Total average shareholders' equity less preferred stock$2,859,491
 2,849,069
 2,786,707
 2,806,533
 
Subtract: Goodwill(57,167) (57,018) (55,144) (24,431) 
Subtract: Other intangible assets, net(11,648) (11,965) (233) (226) 
Total average tangible shareholders' equity less preferred stock$2,790,676
 2,780,086
 2,731,330
 2,781,876
 
Adjusted return on average common equity (annualized)10.92% 10.49
 9.50
 9.08
 
Adjusted return on average tangible common equity (annualized)11.19% 10.75
 9.69
 9.16
 
         
Sequential quarter growth in total average deposits excluding acquired WFB deposits        
3Q17 sequential quarter total average deposits growth, as reported$295,210
       
Subtract: Average balance WFB acquired deposits(71,920)       
3Q17 sequential quarter total average deposits growth, as adjusted$223,290
       
3Q17 sequential quarter growth, excluding WFB acquired deposits$223,290
       
2Q17 total average deposits$24,991,708
       
Sequential quarter percent change, as reported, annualized4.7%       
Sequential quarter percent change, as adjusted, annualized3.5%       
         


Reconciliation of Non-GAAP Financial Measures, continued

   
(dollars in thousands)September 30, 2017 June 30, 2017 December 31, 2016 September 30, 2016 
Average core deposits and average core transaction deposits        
Average total deposits$25,286,919
 24,991,708
 24,661,265
 24,030,291
 
Subtract: Average brokered deposits(1,530,889) (1,379,559) (1,380,931) (1,409,739) 
     Average core deposits23,756,030
 23,612,149

23,280,334
 22,620,552
 
Subtract: Average total SCM deposits(1,991,954) (2,051,646) (2,356,567) (2,105,126) 
Subtract: Average time deposits excluding SCM deposits(3,160,915) (3,151,333) (3,147,620) (3,153,366) 
Average core transaction deposits18,603,161

18,409,170

17,776,147

17,362,060
 
         
Tangible common equity to tangible assets ratio        
Total assets$31,642,123
 30,687,966
 30,104,002
 29,727,096
 
Subtract: Goodwill(57,315) (57,092) (59,678) (24,431) 
Subtract: Other intangible assets, net(11,548) (11,843) (13,223) (225) 
Tangible assets$31,573,260
 30,619,031

30,031,101
 29,702,440
 
Total shareholders' equity$2,997,079
 2,997,947
 2,927,924
 2,906,659
 
Subtract: Goodwill(57,315) (57,092) (59,678) (24,431) 
Subtract: Other intangible assets, net(11,548) (11,843) (13,223) (225) 
Subtract: Series C Preferred Stock, no par value(125,980) (125,980) (125,980) (125,980) 
Tangible common equity$2,802,236
 2,803,032

2,729,043
 2,756,023
 
Total shareholders' equity to total assets ratio9.47% 9.77%
9.73
 9.78
 
     Tangible common equity to tangible assets ratio8.88
 9.15

9.09
 9.28
 
         
Common equity Tier 1 (CET1) ratio (fully phased-in)        
Common equity Tier 1 (CET1)$2,749,304
       
Subtract: Adjustment related to capital components(25,704)       
CET1 (fully phased-in)2,723,600
 


    
Total risk-weighted assets27,329,260
       
Total risk-weighted assets (fully phased-in)27,554,994
       
Common equity Tier 1 (CET1) ratio10.06
 


    
     Common equity Tier 1 (CET1) ratio (fully phased-in)9.88
 


    
         
         



 Nine Months Ended   
(dollars in thousands)September 30, 2017 September 30, 2016 Increase 
Total non-interest expense growth excluding balance sheet restructuring actions      
Total non-interest expense, as reported$594,780
 562,716
 5.7% 
Subtract: Discounts to fair value for completed or planned ORE accelerated dispositions(7,082) —
   
Subtract: Asset impairment charges related to accelerated disposition of corporate real estate and other properties(1,683) —
   
Total non-interest expense excluding balance sheet restructuring actions$586,015
 562,716
 4.1% 
       


Reconciliation of Non-GAAP Financial Measures, continuedYear Ending December 31,   
(dollars in thousands)2017 2016 Increase 
Total non-interest expense growth excluding balance sheet restructuring actions      
Total non-interest expense, as reported$804,806 to $819,925
 755,923
 6.5%-8.5% 
Subtract: Discounts to fair value for completed or planned ORE accelerated dispositions(7,082) —
 — 
Subtract: Asset impairment charges related to accelerated disposition of corporate real estate and other properties(1,683) —
 — 
Subtract: Estimated loss on early extinguishment of debt to be recorded in 4Q17(24,000) —
 — 
Total non-interest expense excluding balance sheet restructuring actions$772,041 to $787,160
 755,923
 2.1%-4.1% 
     




ITEM 3. – QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
The information presented in the Market Risk Analysis section of the Management's Discussion and Analysis of Financial Condition and Results of Operations section of this Report is incorporated herein by reference.
ITEM 4. – CONTROLS AND PROCEDURES
In connection with the preparation of this Quarterly Report on Form 10-Q, an evaluation was carried out by Synovus' management, with the participation of Synovus' Chief Executive Officer and Chief Financial Officer, of the effectiveness of Synovus' disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Disclosure controls and procedures are designed to ensure that information required to be disclosed in reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms and that such information is accumulated and communicated to management, including the Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosures. Based on that evaluation, Synovus' Chief Executive Officer and Chief Financial Officer have concluded that, as of September 30, 2017,March 31, 2022, Synovus' disclosure controls and procedures were effective.
There have been no material changes in Synovus' internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) that occurred during the quarter ended September 30, 2017March 31, 2022 that have materially affected, or are reasonably likely to materially affect, Synovus' internal control over financial reporting.




55


PART II. – OTHER INFORMATION
ITEM 1. – LEGAL PROCEEDINGS
SynovusSee "Part I - Item 1. Financial Statements and its subsidiaries are subject to various legal proceedings, claimsSupplementary Data - Note 9 - Commitments and disputes that arise in the ordinary course of its business. Additionally, in the ordinary course of its business, Synovus and its subsidiaries are subject to regulatory examinations, information gathering requests, inquiries and investigations. Synovus, like many other financial institutions, has been the target of legal actions and other proceedings asserting claims for damages and related relief for losses. These actions include mortgage loan and other loan put-back claims, claims and counterclaims asserted by individual borrowers related to their loans and allegations of violations of state and federal laws and regulations relating to banking practices, including putative class action matters. In addition to actual damages, if Synovus does not prevail in such asserted legal actions, credit-related litigation could result in additional write-downs or charge-offs of assets, which could adversely affect Synovus' results of operations during the period in which the write-down or charge-off were to occur.
Based on Synovus' current knowledge and advice of counsel, management presently does not believe that the liabilities arising from these legal matters will have a material adverse effect on Synovus' consolidated financial condition, results of operations or cash flows. However, it is possible that the ultimate resolution of these legal matters could have a material adverse effect on Synovus' results of operations and financial condition for any particular period. For additional information, see "Note 13 - Legal Proceedings"Contingencies" of this Report, which Note is incorporated herein by this reference.Report.
ITEM 1A. – RISK FACTORS
In addition to the other information set forth in this Report, you should carefully consider the factors discussed in "Part I - Item IA - Risk Factors” of Synovus’ 2016Synovus' 2021 Form 10-K which could materially affect its business, financial position, results of operations, cash flows, or future results. Please be aware that these risks may change over time and other risks may prove to be important in the future. New risks may emerge at any time, and we cannot predict such risks or estimate the extent to which they may affect our business, financial condition or results of operations, or the trading price of our securities.
There wereare no material changes during the period covered by this Report to the risk factors previously disclosed in Synovus’ 2016Synovus' 2021 Form 10-K.
ITEM 2. – UNREGISTERED SALES OF SECURITIES AND USE OF PROCEEDS
(a) None.
(b) None.
(c) Issuer Purchases of Equity Securities:
Synovus'The Company announced on January 20, 2022 that its Board of Directors authorized a $200 million share repurchase program that will expire at the end of 2017. This program was announced on January 17, 2017. The table below sets forth information regarding repurchases of our common stock during the third quarter of 2017.up to $300 million in 2022.
Share Repurchases
(in thousands, except per share data)Total Number of Shares Repurchased
Average Price Paid per Share(1)
Total Number
of Shares Repurchased as
Part of
Publicly Announced
Plans or Programs		Maximum Approximate
Dollar Value
of Shares
that May Yet Be
Purchased Under the
Plans or Programs
January 2022— $— — $300,000 
February 2022— — — 300,000 
March 2022204 47.48 204 290,333 
Total204 $47.48 204 
Share Repurchases Total Number of Shares Repurchased 
Average Price Paid per Share(1)
 
Total Number
of Shares Repurchased as
Part of
Publicly Announced
Plans or Programs
 
Maximum Approximate
Dollar Value
of Shares
that May Yet Be
Purchased Under the
Plans or Programs
     
July 2017 175,900
 $43.84
 175,900
 $146,962,549
August 2017 960,000
 42.67
 960,000
 105,996,984
September 2017 984,800
 42.49
 984,800
 64,149,735
Total 2,120,700
 $42.69
 2,120,700
 
         
(1)The average price paid per share is calculated on a trade date basis for all open market transactions and excludes commissions and other transaction expenses.

The foregoing repurchases during the thirdfirst quarter of 20172022 were purchased through open market transactions, including under plans complying with Rule 10b5-1 under the Exchange Act.


ITEM 3. – DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. – MINE SAFETY DISCLOSURES
None.
ITEM 5. – OTHER INFORMATION
None.


56


ITEM 6. – EXHIBITS
Exhibit

Number
Description
3.1
Amended and Restated Articles of Incorporation of Synovus, as amended, incorporated by reference to Exhibit 3.1 of Synovus’ Quarterly Report on Form 10-Q for the quarter ended June 30, 2010, as filed with the SEC on August 9, 2010.
3.2
Articles of Amendment to the Amended and Restated Articles of Incorporation of Synovus with respect to the Series C Preferred Stock, incorporated by reference to Exhibit 3.1 to Synovus' Current Report on Form 8-K dated July 25, 2013, as filed with the SEC on July 25, 2013.
3.3
Articles of Amendment to the Amended and Restated Articles of Incorporation of Synovus, incorporated by reference to Exhibit 3.1 of Synovus’ Current Report on Form 8-K dated April 22, 2020, as filed with the SEC on April 24, 2020.
3.2 
Restated Bylaws of Synovus, incorporated by reference to Exhibit 3.2 of Synovus' Current Report on Form 8-K dated April 29, 2014,22, 2020, as filed with the SEC on April 29, 2014.24, 2020.
3.410.1 
3.531.1 
12.1
Ratio of Earnings to Fixed Charges.
31.1
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2
32
Certification of Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101
Interactive Data File
104 Cover Page Interactive Data File (formatted in Inline XBRL and contained in Exhibit 101).



57


SIGNATURES
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 thereunto duly authorized.


SYNOVUS FINANCIAL CORP.
November 7, 2017May 3, 2022By:/s/ Kevin S. BlairAndrew J. Gregory, Jr.
DateKevin S. BlairAndrew J. Gregory, Jr.
Executive Vice President and Chief Financial Officer
(Duly Authorized Officer and Principal Financial Officer)



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