Apologies to the country singer Kenny Rogers, but when it comes to excess funds, Umpqua Holdings in Portland, Ore., knows when to hold 'em.
Many bankers have been bullish about their growth prospect, largely downplaying concerns over another recession during fourth-quarter earnings calls. Many executives are continuing to talk about acquisitions as other banks struggle with ongoing industry challenges.
Umpqua's executives remain generally optimistic. The $23.4 billion-asset company recently opened a commercial banking center in San Diego and it is evaluating new markets.
But don't expect Umpqua, which has bought five banks since 2010, to spend its $210 million in excess capital on more acquisitions, even though it is close to completing its integration of Sterling Financial, which it bought in April 2014.
Ray Davis, Umpqua's president and chief executive, was blunt when asked about acquisitions during his company's quarterly call.
"I think the honest answer is not right now, no," he said.
With acquisitions ruled out, Davis was asked about buying back more stock. Davis, in response, cast doubt on the notion that his company had an excessive amount of capital. He said he's satisfied with "where we are right now."
Overall uncertainty is playing a big role in Davis' thinking.
"The intangible with capital right now is … what's going to happen to the economy?" Davis said. "What's going to happen with interest rates? Umpqua has had a history of healthy capital in good times and in bad times. That strategy has always paid off."
To be clear, executives said they were not anticipating problems in any particular geography or loan category, noting that Umpqua aims to have a diversified loan portfolio. Management also remained upbeat about the company's mortgage operations.
Umpqua's earnings rose 21% in the fourth quarter from a year earlier to $63.4 million. Mortgage banking revenue almost doubled, contributing to a 38% increase in fee income.
"We do expect 2016 to be a strong year," Ronald Farnsworth, Umpqua's chief financial officer, said in response to a question about mortgage volume. "We are well positioned in these markets along the West Coast, and I would expect our gain-on-sale margins … [to] stay relatively steady."