ATLANTA, Oct. 25, 2018 (GLOBE NEWSWIRE) -- Atlantic Capital Bancshares, Inc. (NASDAQ: ACBI) announced net income of $6.5 million, or $0.25 per diluted share, for the third quarter of 2018, compared to $8.2 million, or $0.31 per diluted share, in the second quarter of 2018. Operating net income for the third quarter of 2018 was $6.5 million, compared to $6.9 million in the second quarter of 2018.

Net income for the first nine months of 2018 was $19.7 million, or $0.75 per diluted share, compared to $11.6 million, or $0.45 per diluted share, for the first nine months of 2017. Operating net income for the first nine months of 2018 was $18.4 million, or $0.71 per diluted share, compared to $11.6 million, or $0.45 per diluted share, for the first nine months of 2017.

Third Quarter Highlights⁽¹⁾

•         Grew loans held for investment $104 million, or 21.5% annualized, compared to the second quarter of 2018.
•         Grew average deposits $118 million, or 22.1% annualized, compared to the second quarter of 2018.
•         Decreased noninterest expense $766,000 to $16.6 million compared to the second quarter of 2018.
•         Improved efficiency ratio to 64.8% compared to 67.7% in the second quarter of 2018.
•         Reported nonperforming assets to total assets of 0.13%.

“With record loan and deposit growth in the third quarter, Atlantic Capital is well positioned for above average growth in strong markets, further improvement in profitability, and superior through-the-cycle credit quality,” remarked Douglas Williams, President and Chief Executive Officer.

Income Statement

Net interest income increased to $22.7 million in the third quarter of 2018 from $22.1 million in the second quarter of 2018, primarily as a result of higher loan balances in the third quarter. Net accretion income on acquired loans totaled $336,000 in the third quarter of 2018 compared to $331,000 in the second quarter of 2018.

Net interest margin was 3.47% in the third quarter of 2018, a decrease of 7 basis points from the second quarter of 2018, as a result of an increase in cash balances from higher deposit balances and a higher cost of deposits. The accretion from the acquired loan discount and amortization of time deposit premium contributed 6 basis points to the net interest margin in the third quarter of 2018 compared to 7 basis points in the second quarter of 2018.

Loan yields in the third quarter of 2018 increased 2 basis points to 4.97% from the second quarter of 2018. The benefit to loan yields from higher rates was reduced in the third quarter mainly due to the limited increases in 1 month LIBOR during most of the third quarter.

The cost of total deposits in the third quarter of 2018 was 0.77%, an increase of 8 basis points from the second quarter of 2018. The cost of interest bearing deposits increased 15 basis points to 1.12% from the second quarter of 2018, driven by an increase in short term interest rates and competitive pressure.

The provision for loan losses was $845,000 in the third quarter of 2018, an increase compared to ($173,000) in the second quarter of 2018, primarily as a result of an increase in loan balances partially offset by improved credit quality.

Noninterest income totaled $3.1 million in the third quarter of 2018 compared to $5.3 million in the second quarter of 2018. The second quarter included a gain of $1.7 million from the sale of Southeastern Trust Company and $507,000 in trust income earned prior to the sale.

⁽¹⁾ Commentary is on a fully taxable-equivalent basis unless otherwise noted. Consistent with SEC guidance in Industry Guide 3 that contemplates the calculation of tax-exempt income on a tax equivalent basis, net interest income and net interest margin are provided on a fully taxable-equivalent basis, which generally assumes a 21% marginal tax rate for 2018 and 35% for 2017 and prior. We provide detailed reconciliations in the Non-GAAP Performance and Financial Measures Reconciliation table beginning on page 12.

SBA income totaled $882,000, a decrease of $115,000 from the second quarter of 2018 due to a decrease in premiums on the sale of SBA loans and the resulting decision to hold the guaranteed portion of some loans.

Noninterest expense totaled $16.6 million in the third quarter of 2018, a decrease of $766,000 compared to $17.4 million in the second quarter of 2018. Salaries and employee benefits expense decreased by $769,000 to $10.2 million, primarily from the savings associated with the sale of the trust company, lower incentive expense and lower payroll taxes.

Balance Sheet

Total loans held for investment were $2.04 billion at September 30, 2018, an increase of $104.4 million from June 30, 2018. This included growth of $59.6 million in commercial and industrial and owner occupied commercial real estate loans from June 30, 2018.

At September 30, 2018, the allowance for loan losses was $20.4 million, or 1.00% of loans held for investment, compared to $19.6 million, or 1.01% of loans held for investment as of June 30, 2018. Annualized net charge-offs to average loans were 0.00% in the third quarter of 2018 compared to 0.03% in the second quarter of 2018. Nonperforming assets totaled $3.7 million, or 0.13% of total assets, as of September 30, 2018, compared to $3.7 million, or 0.14% of total assets, as of June 30, 2018.

Total average deposits for the third quarter of 2018 were $2.25 billion, an increase of $118.2 million from the second quarter of 2018. This increase included some increases in large, temporary deposits that we anticipate to decrease in late 2018 and early 2019. Average transaction deposits, which includes DDA and NOW accounts, increased $90.1 million in the third quarter of 2018, compared to the second quarter.

Earnings Conference Call

The Company will host a conference call at 9:30 a.m. EST on Friday, October 26, 2018, to discuss the financial results for the quarter ended September 30, 2018. Individuals wishing to participate in the conference call may do so by dialing 844.868.8848 from the United States and entering Conference ID 89772886. The call will also be available live via webcast on the Investor Relations page of the Company's website, www.atlanticcapitalbank.com.

Non-GAAP Financial Measures

Statements included in this press release include non-GAAP financial measures and should be read along with the accompanying tables, which provide a reconciliation of non-GAAP financial measures to GAAP financial measures. Atlantic Capital management uses non-GAAP financial measures, including: (i) operating net income; (ii) operating noninterest income; (iii) taxable equivalent interest income; (iv) taxable equivalent net interest income; (v) taxable equivalent net interest margin; (vi) operating income before taxes; (vii) operating income tax expense; (viii) operating return on average assets; (ix) operating return on average equity; (x) tangible common equity; (xi) tangible book value per common share; (xii) efficiency ratio; and (xiii) operating diluted earnings per share, in its analysis of the Company's performance. Operating net income excludes the net gain on the sale of the trust company and the revaluation of net deferred tax assets. Tangible common equity excludes goodwill and other intangible assets from shareholders' equity.

Management believes that non-GAAP financial measures provide a greater understanding of ongoing performance and operations, and enhance comparability with prior periods. Non-GAAP financial measures should not be considered as an alternative to any measure of performance or financial condition as determined in accordance with GAAP, and investors should consider Atlantic Capital’s performance and financial condition as reported under GAAP and all other relevant information when assessing the performance or financial condition of the Company. Non-GAAP financial measures have limitations as analytical tools, and investors should not consider them in isolation or as a substitute for analysis of the results or financial condition as reported under GAAP. Non-GAAP financial measures may not be comparable to non-GAAP financial measures presented by other companies.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements represent plans, estimates, objectives, goals, guidelines, expectations, intentions, projections and statements of our beliefs concerning future events, business plans, objectives, expected operating results and the assumptions upon which those statements are based. Forward-looking statements include without limitation, any statement that may predict, forecast, indicate or imply future results, performance or achievements, and are typically identified with words such as “may,” “could,” “should,” “will,” “would,” “believe,” “anticipate,” “estimate,” “project,” “expect,” “intend,” “plan,” or words or phases of similar meaning. Forward-looking statements may include, among other things, statements about Atlantic Capital’s confidence in its strategies and its expectations about financial performance, market growth, market and regulatory trends and developments, acquisitions and divestitures, new technologies, services and opportunities and earnings. The forward-looking statements are based largely on Atlantic Capital’s expectations and are subject to a number of known and unknown risks and uncertainties that are subject to change based on factors which are, in many instances, beyond Atlantic Capital’s control. Atlantic Capital undertakes no obligation to publicly update any forward-looking statement to reflect developments occurring after the statement is made, except as otherwise required by law. Actual results, performance or achievements could differ materially from those contemplated, expressed, or implied by the forward-looking statements as a result of, among other factors, the risks and uncertainties described in “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Atlantic Capital’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q. Please refer to the SEC’s website at www.sec.gov where you can review those documents.

About Atlantic Capital Bancshares

Atlantic Capital Bancshares, Inc. is a $2.88 billion publicly traded bank holding company headquartered in Atlanta, Georgia. Atlantic Capital offers banking, treasury management, capital markets and mortgage services to privately held companies and individuals in Atlanta, eastern Tennessee, and northwest Georgia. Atlantic Capital also provides specialized financial services to select clients nationally.

Media Contact:
Ashley Carson
Email: ashley.carson@atlcapbank.com
Phone: 404-995-6050

Financial Contact:
Patrick Oakes
Email: patrick.oakes@atlcapbank.com
Phone: 404-995-6050

ATLANTIC CAPITAL BANCSHARES, INC.
Selected Financial Information
		2018												2017								For the nine months ended September 30,
(in thousands, except share and per share data; taxable equivalent)		Third Quarter				Second Quarter				First Quarter				Fourth Quarter				Third Quarter				2018				2017
INCOME SUMMARY
Interest income (1)		$	28,616			$	27,444			$	26,085			$	25,350			$	24,566			$	82,145			$	71,827
Interest expense		5,956				5,332				4,465				4,028				4,060				15,753				11,101
Net interest income		22,660				22,112				21,620				21,322				20,506				66,392				60,726
Provision for loan losses		845				(173		)		772				282				322				1,444				2,936
Net interest income after provision for loan losses		21,815				22,285				20,848				21,040				20,184				64,948				57,790
Operating noninterest income (2)		3,066				3,650				3,983				3,568				3,477				10,699				12,621
Noninterest expense		16,595				17,361				18,392				20,594				17,504				52,348				52,871
Operating income before income taxes (2)		8,286				8,574				6,439				4,014				6,157				23,299				17,540
Operating income tax expense (3)		1,773				1,684				1,401				1,953				2,105				4,858				5,929
Operating net income (2)(3)		6,513				6,890				5,038				2,061				4,052				18,441				11,611
Net gain on sale of trust company, net of income tax		—				1,261				—				—				—				1,261				—
Revaluation of net deferred tax asset		—				—				—				17,398				—				—				—
Net income (loss) - GAAP		$	6,513			$	8,151			$	5,038			$	(15,337	)		$	4,052			$	19,702			$	11,611
PER SHARE DATA
Diluted earnings (loss) per share - GAAP		$	0.25			$	0.31			$	0.19			$	(0.60	)		$	0.16			$	0.75			$	0.45
Diluted earnings per share - operating (2)(3)		0.25				0.26				0.19				0.08				0.16				0.71				0.45
Book value per share		12.27				12.14				11.91				11.99				12.63				12.27				12.63
Tangible book value per common share (4)		11.37				11.23				10.98				11.05				11.67				11.37				11.67
PERFORMANCE MEASURES
Return on average equity - GAAP		8.07			%	10.46			%	6.66			%	(18.66		)	%	4.96			%	8.41			%	4.91			%
Return on average equity - operating (2)(3)		8.07				8.84				6.66				2.51				4.96				7.87				4.91
Return on average assets - GAAP		0.92				1.20				0.76				(2.24		)		0.60				0.96				0.57
Return on average assets - operating (2)(3)		0.92				1.02				0.76				0.30				0.60				0.90				0.57
Taxable equivalent net interest margin		3.47				3.54				3.51				3.39				3.26				3.50				3.24
Efficiency ratio		64.75				67.65				72.13				83.45				73.65				68.17				72.77
CAPITAL
Average equity to average assets		11.41			%	11.50			%	11.34			%	11.99			%	11.99			%	11.42			%	11.63			%
Tangible common equity to tangible assets		10.38				10.99				10.50				9.91				11.48				10.38				11.48
Tier 1 capital ratio		11.8			(6)	12.0				11.3				11.2				11.3				11.8			(6)	11.3
Total risk based capital ratio		14.7			(6)	15.0				14.3				14.1				14.3				14.7			(6)	14.3
Number of common shares outstanding - basic		26,103,666				26,102,217				25,772,208				25,712,909				25,716,418				26,103,666				25,716,418
Number of common shares outstanding - diluted		26,281,849				26,336,871				26,000,216				25,891,225				25,967,575				26,281,849				25,967,575
ASSET QUALITY
Allowance for loan losses to loans held for investment		1.00			%	1.01			%	1.01			%	1.00			%	0.99			%	1.00			%	0.99			%
Net charge-offs to average loans (5)		—				0.03				0.05				(0.04		)		0.68				0.02				0.32
Non-performing assets to total assets		0.13				0.14				0.13				0.14				0.23				0.13				0.23
(1)Interest income on tax-exempt securities has been increased to reflect comparable interest on taxable securities. The rate used was 21% for all periods ending in 2018 and 35% for all periods ending in 2017, reflecting the statutory federal income tax rates. (2)Excludes gain on sale of trust company. (3)Excludes revaluation of net deferred tax asset. (4)Excludes effect of acquisition related intangibles. (5)Annualized. (6)Amounts are estimates as of 9/30/18.

ATLANTIC CAPITAL BANCSHARES, INC.
Consolidated Balance Sheets (unaudited)
		September 30,				June 30,				December 31,				September 30,
(in thousands, except share data)		2018				2018				2017				2017
ASSETS
Cash and due from banks		$	28,007			$	55,612			$	38,086			$	35,504
Interest-bearing deposits in banks		140,682				42,477				281,247				40,558
Other short-term investments		20,898				14,712				10,681				5,189
Cash and cash equivalents		189,587				112,801				330,014				81,251
Investment securities available-for-sale		465,756				453,968				449,117				447,005
Other investments		33,021				36,190				32,174				35,818
Loans held for sale		1,886				1,612				1,487				3,274
Loans held for investment		2,038,434				1,934,311				1,933,839				1,905,432
Less: allowance for loan losses		(20,443		)		(19,583		)		(19,344		)		(18,870		)
Loans held for investment, net		2,017,991				1,914,728				1,914,495				1,886,562
Premises and equipment, net		17,371				16,878				12,054				11,747
Bank owned life insurance		64,769				64,391				63,667				63,284
Goodwill and intangible assets, net		26,557				27,012				27,633				27,945
Other real estate owned		968				1,288				1,215				1,494
Other assets		64,815				61,806				59,565				80,032
Total assets		$	2,882,721			$	2,690,674			$	2,891,421			$	2,638,412
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits:
Noninterest-bearing demand		$	653,816			$	595,867			$	732,442			$	599,292
Interest-bearing checking		486,456				332,481				306,331				270,740
Savings		27,192				27,559				26,573				30,131
Money market		977,552				865,913				1,117,891				865,238
Time		155,689				152,111				138,612				144,250
Brokered deposits		79,119				92,656				128,816				193,994
Total deposits		2,379,824				2,066,587				2,450,665				2,103,645
Federal funds purchased and securities sold under agreements to repurchase		8,904				73,024				—				—
Federal Home Loan Bank borrowings		83,000				150,000				45,000				125,000
Long-term debt		49,662				49,620				49,535				49,493
Other liabilities		41,094				34,673				37,796				35,520
Total liabilities		2,562,484				2,373,904				2,582,996				2,313,658
SHAREHOLDERS' EQUITY
Preferred stock, no par value;  10,000,000 shares authorized; no shares issued and outstanding as of September 30, 2018, June 30, 2018, December 31, 2017, and September 30, 2017		—				—				—				—
Common stock, no par value; 100,000,000 shares authorized; 26,103,666, 26,102,217, 25,712,909, and 25,716,418 shares issued and outstanding as of September 30, 2018, June 30, 2018, December 31, 2017, and September 30, 2017		305,300				304,793				299,474				298,469
Retained earnings		33,357				26,844				12,810				28,147
Accumulated other comprehensive (loss) income		(18,420		)		(14,867		)		(3,859		)		(1,862		)
Total shareholders’ equity		320,237				316,770				308,425				324,754
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY		$	2,882,721			$	2,690,674			$	2,891,421			$	2,638,412

ATLANTIC CAPITAL BANCSHARES, INC.
Consolidated Statements of Income (unaudited)
(in thousands, except share and per share data)		Three months ended																				Nine months ended
		September 30, 2018				June 30, 2018				March 31, 2018				December 31, 2017				September 30, 2017				September 30, 2018				September 30, 2017
INTEREST INCOME
Loans, including fees		$	24,619			$	23,779			$	22,675			$	22,043			$	21,491			$	71,073			$	62,846
Investment securities available-for-sale		2,789				2,687				2,592				2,510				2,298				8,068				6,671
Interest and dividends on other interest‑earning assets		1,111				880				715				584				562				2,706				1,617
Total interest income		28,519				27,346				25,982				25,137				24,351				81,847				71,134
INTEREST EXPENSE
Interest on deposits		4,403				3,651				3,044				2,856				2,693				11,098				7,221
Interest on Federal Home Loan Bank advances		637				766				509				323				459				1,912				1,213
Interest on federal funds purchased and securities sold under agreements to repurchase		92				92				83				26				84				267				196
Interest on long-term debt		824				823				829				823				824				2,476				2,471
Total interest expense		5,956				5,332				4,465				4,028				4,060				15,753				11,101
NET INTEREST INCOME BEFORE PROVISION FOR LOAN LOSSES		22,563				22,014				21,517				21,109				20,291				66,094				60,033
Provision for loan losses		845				(173		)		772				282				322				1,444				2,936
NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES		21,718				22,187				20,745				20,827				19,969				64,650				57,097
NONINTEREST  INCOME
Service charges		1,278				1,308				1,192				1,206				1,247				3,778				3,870
Gains (losses) on sale of securities		—				(2		)		—				17				(80		)		(2		)		(80		)
Gains (losses) on sale of other assets		58				(166		)		(46		)		(46		)		44				(154		)		788
Mortgage income		315				363				304				290				320				982				965
Trust income		—				507				518				482				437				1,025				1,332
Derivatives income		20				20				114				94				(3		)		154				62
Bank owned life insurance		379				378				369				384				384				1,126				1,146
SBA lending activities		882				997				1,302				843				888				3,181				3,286
Gains on sale of branches		—				—				—				—				—				—				302
Gain on sale of trust company		—				1,681				—				—				—				1,681				—
Other noninterest income		134				245				230				298				240				609				950
Total noninterest income		3,066				5,331				3,983				3,568				3,477				12,380				12,621
NONINTEREST EXPENSE
Salaries and employee benefits		10,152				10,921				12,077				13,298				10,409				33,150				32,077
Occupancy		1,288				1,211				1,355				1,156				1,129				3,854				3,433
Equipment and software		964				904				787				872				776				2,655				2,577
Professional services		803				960				832				1,280				1,595				2,595				3,472
Postage, printing and supplies		75				61				58				114				63				194				226
Communications and data processing		947				1,003				1,043				1,111				982				2,993				3,038
Marketing and business development		281				191				190				225				272				662				721
FDIC premiums		208				197				147				212				308				552				754
Merger and conversion costs		—				—				—				—				—				—				304
Amortization of intangibles		296				319				343				367				391				958				1,286
Foreclosed property/problem asset expense		12				2				282				7				7				296				117
Other noninterest expense		1,569				1,592				1,278				1,952				1,572				4,439				4,866
Total noninterest expense		16,595				17,361				18,392				20,594				17,504				52,348				52,871
INCOME BEFORE PROVISION FOR INCOME TAXES		8,189				10,157				6,336				3,801				5,942				24,682				16,847
Provision for income taxes		1,676				2,006				1,298				19,138				1,890				4,980				5,236
NET INCOME (LOSS)		$	6,513			$	8,151			$	5,038			$	(15,337	)		$	4,052			$	19,702			$	11,611
Net income (loss) per common share ‑ basic		$	0.25			$	0.31			$	0.20			$	(0.60	)		$	0.16			$	0.76			$	0.45
Net income (loss) per common share ‑ diluted		$	0.25			$	0.31			$	0.19			$	(0.60	)		$	0.16			$	0.75			$	0.45
Weighted average shares - basic		26,103,397				26,010,914				25,750,824				25,723,548				25,699,179				25,956,336				25,548,646
Weighted average shares - diluted		26,254,772				26,200,026				25,945,773				25,888,064				25,890,779				26,134,655				25,799,851

ATLANTIC CAPITAL BANCSHARES, INC.
Average Balance Sheets and Net Interest Margin Analysis
Selected Financial Information
		Three months ended
		September 30, 2018												June 30, 2018
(dollars in thousands; taxable equivalent)		Average Balance				Interest Income/ Expense				Tax Equivalent Yield/Rate				Average Balance				Interest Income/ Expense				Tax Equivalent Yield/Rate
Assets
Interest bearing deposits in other banks		$	128,248			$	647			2.00		%		$	97,501			$	562			2.31		%
Other short-term investments		21,985				157				2.83				9,262				64				2.77
Investment securities:
Taxable investment securities		385,834				2,315				2.38				378,291				2,212				2.35
Non-taxable investment securities(1)		75,514				571				3.00				76,343				573				3.01
Total investment securities		461,348				2,886				2.48				454,634				2,785				2.46
Total loans		1,963,817				24,619				4.97				1,927,063				23,779				4.95
FHLB and FRB stock		17,624				307				6.91				19,357				254				5.26
Total interest-earning assets		2,593,022				28,616				4.38				2,507,817				27,444				4.39
Non-earning assets		212,718												210,254
Total assets		$	2,805,740											$	2,718,071
Liabilities
Interest bearing deposits:
NOW, money market, and savings		1,333,701				3,491				1.04				1,254,153				2,798				0.89
Time deposits		154,507				551				1.41				148,134				385				1.04
Brokered deposits		67,937				361				2.11				100,425				468				1.87
Total interest-bearing deposits		1,556,145				4,403				1.12				1,502,712				3,651				0.97
Total borrowings		143,148				729				2.02				185,856				858				1.85
Total long-term debt		49,634				824				6.59				49,592				823				6.66
Total interest-bearing liabilities		1,748,927				5,956				1.35				1,738,160				5,332				1.23
Demand deposits		697,927												633,113
Other liabilities		38,796												34,255
Shareholders' equity		320,090												312,543
Total liabilities and shareholders' equity		$	2,805,740											$	2,718,071
Net interest spread										3.03		%										3.16		%
Net interest income and net interest margin(2)						$	22,660			3.47		%						$	22,112			3.54		%
Non-taxable equivalent net interest margin										3.45		%										3.52		%
(1) Interest revenue on tax-exempt securities has been increased to reflect comparable interest on taxable securities. The rate used was 21%, reflecting the statutory federal income tax rates.
(2) Tax equivalent net interest income divided by total interest-earning assets using the appropriate day count convention based on the type of interest-earning asset.

ATLANTIC CAPITAL BANCSHARES, INC.
Average Balance Sheets and Net Interest Margin Analysis
Selected Financial Information
		Nine months ended
		September 30, 2018												September 30, 2017
(dollars in thousands; taxable equivalent)		Average Balance				Interest Income/ Expense				Tax Equivalent Yield/Rate				Average Balance				Interest Income/ Expense				Tax Equivalent Yield/Rate
Assets
Interest bearing deposits in other banks		$	101,502			$	1,606			2.12		%		$	76,079			$	614			1.08		%
Other short-term investments		13,907				284				2.73				16,198				231				1.91
Investment securities:
Taxable investment securities		380,002				6,643				2.34				362,080				5,197				1.92
Non-taxable investment securities(1)		76,658				1,723				3.01				81,485				2,167				3.56
Total investment securities		456,660				8,366				2.45				443,565				7,364				2.22
Total loans		1,943,369				71,073				4.89				1,948,700				62,846				4.31
FHLB and FRB stock		18,291				816				5.96				19,147				772				5.39
Total interest-earning assets		2,533,729				82,145				4.33				2,503,689				71,827				3.84
Non-earning assets		209,518												215,830
Total assets		$	2,743,247											$	2,719,519
Liabilities
Interest bearing deposits:
NOW, money market, and savings		1,296,370				8,637				0.89				1,171,369				4,842				0.55
Time deposits		147,531				1,249				1.13				152,190				833				0.73
Brokered deposits		80,920				1,212				2.00				182,195				1,546				1.13
Total interest-bearing deposits		1,524,821				11,098				0.97				1,505,754				7,221				0.64
Total borrowings		161,892				2,179				1.80				196,352				1,409				0.96
Total long-term debt		49,592				2,476				6.68				49,423				2,471				6.68
Total interest-bearing liabilities		1,736,305				15,753				1.21				1,751,529				11,101				0.85
Demand deposits		656,807												624,923
Other liabilities		36,935												26,706
Shareholders' equity		313,200												316,361
Total liabilities and shareholders' equity		$	2,743,247											$	2,719,519
Net interest spread										3.12		%										2.99		%
Net interest income and net interest margin(2)						$	66,392			3.50		%						$	60,726			3.24		%
Non-taxable equivalent net interest margin										3.49		%										3.21		%
(1) Interest revenue on tax-exempt securities has been increased to reflect comparable interest on taxable securities. The rate used was 21% for the nine months ended September 30, 2018 and 35% for the nine months ended September 30, 2017, reflecting the statutory federal income tax rates.
(2) Tax equivalent net interest income divided by total interest-earning assets using the appropriate day count convention based on the type of interest-earning asset.

ATLANTIC CAPITAL BANCSHARES, INC.
Period End Loans
(dollars in thousands)		September 30, 2018				June 30, 2018				March 31, 2018				December 31, 2017				September 30, 2017				Linked Quarter Change				Year Over Year Change
Loans held for sale
Loans held for sale		$	1,886			$	1,612			$	835			$	1,487			$	3,274			$	274			$	(1,388	)
Total loans held for sale		$	1,886			$	1,612			$	835			$	1,487			$	3,274			$	274			$	(1,388	)
Loans held for investment
Commercial loans:
Commercial and industrial		$	648,349			$	610,024			$	636,181			$	615,359			$	562,426			$	38,325			$	85,923
Commercial real estate:
Multifamily		115,254				99,140				99,227				99,553				91,219				16,114				24,035
Owner occupied		390,563				367,441				353,235				346,746				348,447				23,122				42,116
Investment		468,237				455,401				461,638				494,116				505,188				12,836				(36,951		)
Construction and land:
1-4 family residential construction		4,381				6,178				6,571				6,906				9,644				(1,797		)		(5,263		)
Other construction, development, and land		155,400				140,026				139,333				108,589				122,436				15,374				32,964
Mortgage warehouse loans		27,838				38,352				44,575				39,981				41,551				(10,514		)		(13,713		)
Total commercial loans		1,810,022				1,716,562				1,740,760				1,711,250				1,680,911				93,460				129,111
Residential:
Residential mortgages		109,522				103,468				105,255				104,484				101,976				6,054				7,546
Home equity		66,847				66,974				70,712				76,244				78,773				(127		)		(11,926		)
Total residential loans		176,369				170,442				175,967				180,728				180,749				5,927				(4,380		)
Consumer		33,540				32,231				30,966				29,393				31,750				1,309				1,790
Other		21,399				17,997				15,181				16,278				16,106				3,402				5,293
		2,041,330				1,937,232				1,962,874				1,937,649				1,909,516				104,098				131,814
Less net deferred fees and other unearned income		(2,896		)		(2,921		)		(3,453		)		(3,810		)		(4,084		)		25				1,188
Total loans held for investment		$	2,038,434			$	1,934,311			$	1,959,421			$	1,933,839			$	1,905,432			$	104,123			$	133,002
Total loans		$	2,040,320			$	1,935,923			$	1,960,256			$	1,935,326			$	1,908,706			$	104,397			$	131,614

ATLANTIC CAPITAL BANCSHARES, INC.
Allowance for Loan Losses Activity and Credit Quality
		2018												2017
(dollars in thousands)		Third Quarter				Second Quarter				First  Quarter				Fourth Quarter				Third Quarter
Balance at beginning of period		$	19,583			$	19,885			$	19,344			$	18,870			$	21,870
Provision for loan losses		758				(173		)		811				312				314
Provision for PCI loan losses		87				—				(39		)		(30		)		8
Loans charged-off:
Commercial and industrial		—				—				(126		)		—				(3,292		)
Commercial real estate		—				(50		)		—				—				—
Construction and land		—				—				—				—				(16		)
Residential mortgages		—				—				(70		)		—				—
Home equity		—				(102		)		(58		)		—				(31		)
Consumer		—				(10		)		(3		)		(13		)		(7		)
Other		—				—				—				—				—
Total loans charged-off		—				(162		)		(257		)		(13		)		(3,346		)
Recoveries on loans previously charged-off:
Commercial and industrial		—				—				19				192				1
Commercial real estate		—				28				—				—				—
Construction and land		—				—				—				1				15
Residential mortgages		—				—				—				—				—
Home equity		—				—				—				—				—
Consumer		15				5				7				12				8
Other		—				—				—				—				—
Total recoveries		15				33				26				205				24
Net charge-offs		$	15			$	(129	)		$	(231	)		$	192			$	(3,322	)
Balance at period end		$	20,443			$	19,583			$	19,885			$	19,344			$	18,870
Loans held for investment
PCI Loans		$	6,307			$	10,620			$	11,837			$	11,754			$	12,090
Non-PCI Loans		2,032,127				1,923,691				1,947,584				1,922,085				1,893,342
		$	2,038,434			$	1,934,311			$	1,959,421			$	1,933,839			$	1,905,432
Non-performing loans - PCI		$	750			$	969			$	1,217			$	1,211			$	1,289
Non-performing loans - Non-PCI		$	2,716			$	2,406			$	2,501			$	2,912			$	4,553
Foreclosed properties (OREO)		968				1,288				927				1,215				1,494
Total nonperforming assets		$	3,684			$	3,694			$	3,428			$	4,127			$	6,047
Allowance for loan losses to loans held for investment		1.00			%	1.01			%	1.01			%	1.00			%	0.99			%
Net charge-offs to average loans (1)		—				0.03				0.05				(0.04		)		0.68
Nonperforming loans as a percentage of total loans (2)		0.13				0.12				0.13				0.15				0.24
Nonperforming assets as a percentage of total assets (2)		0.13				0.14				0.13				0.14				0.23
(1)Annualized.  (2)Excludes non-performing PCI loans.

ATLANTIC CAPITAL BANCSHARES, INC.
Period End Deposits
(dollars in thousands)		September 30, 2018				June 30,  2018				March 31, 2018				December 31, 2017				September 30, 2017				Linked Quarter Change				Year Over Year Change
DDA		$	653,816			$	595,867			$	599,838			$	732,442			$	599,292			$	57,949			$	54,524
NOW		486,456				332,481				302,636				306,331				270,740				153,975				215,716
Savings		27,192				27,559				29,407				26,573				30,131				(367		)		(2,939		)
Money Market		977,552				865,913				911,449				1,117,891				865,238				111,639				112,314
Time		155,689				152,111				140,594				138,612				144,250				3,578				11,439
Brokered		79,119				92,656				112,376				128,816				193,994				(13,537		)		(114,875		)
Total Deposits		$	2,379,824			$	2,066,587			$	2,096,300			$	2,450,665			$	2,103,645			$	313,237			$	276,179
Payments Clients		$	258,320			$	251,748			$	311,943			$	405,873			$	239,079			$	6,572			$	19,241
Average Deposits
		2018												2017								Linked Quarter Change				Year Over Year Change
(dollars in thousands)		Third Quarter				Second Quarter				First  Quarter				Fourth Quarter				Third Quarter
DDA		$	697,927			$	633,113			$	638,730			$	649,218			$	628,029			$	64,814			$	69,898
NOW		389,649				364,362				329,171				338,741				291,810				25,287				97,839
Savings		27,257				28,239				29,609				29,851				30,236				(982		)		(2,979		)
Money Market		916,795				861,552				898,800				907,524				870,618				55,243				46,177
Time		154,507				148,134				139,788				140,921				143,862				6,373				10,645
Brokered		67,937				100,425				117,787				128,594				156,708				(32,488		)		(88,771		)
Total Deposits		$	2,254,072			$	2,135,825			$	2,153,885			$	2,194,849			$	2,121,263			$	118,247			$	132,809
Payments Clients		$	227,029			$	219,016			$	256,794			$	234,558			$	209,851			$	8,013			$	17,178
Noninterest bearing deposits as a percentage of average deposits		31.0		%		29.6		%		29.7		%		29.6		%		29.6		%
Cost of deposits		0.77		%		0.69		%		0.57		%		0.52		%		0.50		%

ATLANTIC CAPITAL BANCSHARES, INC.
Non-GAAP Performance and Financial Measures Reconciliation
		2018												2017								For the nine months ended September 30,
(in thousands, except share and per share data)		Third Quarter				Second Quarter				First Quarter				Fourth Quarter				Third Quarter				2018				2017
Taxable equivalent interest income reconciliation
Interest income - GAAP		$	28,519			$	27,346			$	25,982			$	25,137			$	24,351			$	81,847			$	71,134
Taxable equivalent adjustment		97				98				103				213				215				298				693
Interest income - taxable equivalent		$	28,616			$	27,444			$	26,085			$	25,350			$	24,566			$	82,145			$	71,827
Taxable equivalent net interest income reconciliation
Net interest income - GAAP		$	22,563			$	22,014			$	21,517			$	21,109			$	20,291			$	66,094			$	60,033
Taxable equivalent adjustment		97				98				103				213				215				298				693
Net interest income - taxable equivalent		$	22,660			$	22,112			$	21,620			$	21,322			$	20,506			$	66,392			$	60,726
Taxable equivalent net interest margin reconciliation
Net interest margin - GAAP		3.45			%	3.52			%	3.49			%	3.35			%	3.23			%	3.49			%	3.21			%
Impact of taxable equivalent adjustment		0.02				0.02				0.02				0.04				0.03				0.01				0.03
Net interest margin - taxable equivalent		3.47			%	3.54			%	3.51			%	3.39			%	3.26			%	3.50			%	3.24			%
Operating noninterest income reconciliation
Noninterest income - GAAP		$	3,066			$	5,331			$	3,983			$	3,568			$	3,477			$	12,380			$	12,621
Gain on sale of trust company		—				(1,681		)		—				—				—				(1,681		)		—
Operating noninterest income		$	3,066			$	3,650			$	3,983			$	3,568			$	3,477			$	10,699			$	12,621
Operating income before income taxes reconciliation
Income before income taxes - GAAP		$	8,189			$	10,157			$	6,336			$	3,801			$	5,942			$	24,682			$	16,847
Taxable equivalent adjustment		97				98				103				213				215				298				693
Gain on sale of trust company		—				(1,681		)		—				—				—				(1,681		)		—
Operating income before income taxes		$	8,286			$	8,574			$	6,439			$	4,014			$	6,157			$	23,299			$	17,540
Operating income tax reconciliation
Income tax expense - GAAP		$	1,676			$	2,006			$	1,298			$	19,138			$	1,890			$	4,980			$	5,236
Taxable equivalent adjustment		97				98				103				213				215				298				693
Gain on sale of trust company, tax expense		—				(420		)		—				—				—				(420		)		—
Revaluation of net deferred tax asset		—				—				—				(17,398		)		—				—				—
Operating income tax expense		$	1,773			$	1,684			$	1,401			$	1,953			$	2,105			$	4,858			$	5,929
Operating net income reconciliation
Net income (loss) - GAAP		$	6,513			$	8,151			$	5,038			$	(15,337	)		$	4,052			$	19,702			$	11,611
Gain on sale of trust company, net of income tax		—				(1,261		)		—				—				—				(1,261		)		—
Revaluation of net deferred tax asset		—				—				—				17,398				—				—				—
Operating net income		$	6,513			$	6,890			$	5,038			$	2,061			$	4,052			$	18,441			$	11,611
Operating diluted earnings per share reconciliation
Diluted earnings (loss) per share - GAAP		$	0.25			$	0.31			$	0.19			$	(0.60	)		$	0.16			$	0.75			$	0.45
Net gain on sale of trust company		—				(0.05		)		—				—				—				(0.04		)		—
Revaluation of net deferred tax asset		—				—				—				0.68				—				—				—
Diluted earnings per share - operating		$	0.25			$	0.26			$	0.19			$	0.08			$	0.16			$	0.71			$	0.45
Tangible book value per common share reconciliation
Total shareholders’ equity		$	320,237			$	316,770			$	307,059			$	308,425			$	324,754			$	320,237			$	324,754
Intangible assets		(23,367		)		(23,662		)		(24,050		)		(24,393		)		(24,760		)		(23,367		)		(24,760		)
Total tangible common equity		$	296,870			$	293,108			$	283,009			$	284,032			$	299,994			$	296,870			$	299,994
Common shares outstanding		26,103,666				26,102,217				25,772,208				25,712,909				25,716,418				26,103,666				25,716,418
Book value per common share - GAAP		$	12.27			$	12.14			$	11.91			$	11.99			$	12.63			$	12.27			$	12.63
Tangible book value		11.37				11.23				10.98				11.05				11.67				11.37				11.67
Return on average equity reconciliation
Net income (loss) - GAAP		$	6,513			$	8,151			$	5,038			$	(15,337	)		$	4,052			$	19,702			$	11,611
Gain on sale of trust company, net of income tax		—				(1,261		)		—				—				—				(1,261		)		—
Revaluation of net deferred tax asset		—				—				—				17,398				—				—				—
Operating net income		$	6,513			$	6,890			$	5,038			$	2,061			$	4,052			$	18,441			$	11,611
Average shareholders' equity		$	320,090			$	312,543			$	306,821			$	326,059			$	323,832			$	313,200			$	316,361
Return on average equity - GAAP		8.07			%	10.46			%	6.66			%	(18.66		)	%	4.96			%	8.41			%	4.91			%
Return on average equity - operating		8.07				8.84				6.66				2.51				4.96				7.87				4.91
Return on average assets reconciliation
Net income (loss) - GAAP		$	6,513			$	8,151			$	5,038			$	(15,337	)		$	4,052			$	19,702			$	11,611
Gain on sale of trust company, net of income tax		—				(1,261		)		—				—				—				(1,261		)		—
Revaluation of net deferred tax asset		—				—				—				17,398				—				—				—
Operating net income		$	6,513			$	6,890			$	5,038			$	2,061			$	4,052			$	18,441			$	11,611
Average assets		$	2,805,740			$	2,718,071			$	2,704,822			$	2,720,070			$	2,701,387			$	2,743,247			$	2,719,519
Return on average assets - GAAP		0.92			%	1.20			%	0.76			%	(2.24		)	%	0.60			%	0.96			%	0.57			%
Return on average assets - operating		0.92				1.02				0.76				0.30				0.60				0.90				0.57
Efficiency ratio reconciliation
Noninterest income - GAAP		$	3,066			$	5,331			$	3,983			$	3,568			$	3,477			$	12,380			$	12,621
Gain on sale of trust company		—				(1,681		)		—				—				—				(1,681		)		—
Operating noninterest income		$	3,066			$	3,650			$	3,983			$	3,568			$	3,477			$	10,699			$	12,621
Noninterest expense - GAAP		$	16,595			$	17,361			$	18,392			$	20,594			$	17,504			$	52,348			$	52,871
Net interest income		$	22,563			$	22,014			$	21,517			$	21,109			$	20,291			$	66,094			$	60,033
Efficiency ratio		64.75			%	67.65			%	72.13			%	83.45			%	73.65			%	68.17			%	72.77			%
Tangible common equity to tangible assets reconciliation
Total shareholders’ equity		$	320,237			$	316,770			$	307,059			$	308,425			$	324,754			$	320,237			$	324,754
Intangible assets		(23,367		)		(23,662		)		(24,050		)		(24,393		)		(24,760		)		(23,367		)		(24,760		)
Total tangible common equity		$	296,870			$	293,108			$	283,009			$	284,032			$	299,994			$	296,870			$	299,994
Total assets		$	2,882,721			$	2,690,674			$	2,718,665			$	2,891,421			$	2,638,412			$	2,882,721			$	2,638,412
Intangible assets		(23,367		)		(23,662		)		(24,050		)		(24,393		)		(24,760		)		(23,367		)		(24,760		)
Total tangible assets		$	2,859,354			$	2,667,012			$	2,694,615			$	2,867,028			$	2,613,652			$	2,859,354			$	2,613,652
Tangible common equity to tangible assets		10.38			%	10.99			%	10.50			%	9.91			%	11.48			%	10.38			%	11.48			%

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