• Old National's 1st Quarter Driven by Transformative Merger with First Midwest and Strong Commercial Loan Growth

    ソース: Nasdaq GlobeNewswire / 26 4 2022 08:00:04   America/New_York

    EVANSVILLE, Ind., April 26, 2022 (GLOBE NEWSWIRE) --

    Reflective of the CECL Day 1 provision expense and merger related expenses, all as expected, Old National Bancorp (NASDAQ: ONB) reports 1Q22 net loss applicable to common shares of $29.6 million, diluted EPS of $(0.13). Adjusted net income applicable to common shares1 of $91.6 million, or $0.40 per diluted common share.

    CEO COMMENTARY:

    “Old National’s 1st quarter results were driven by several factors, including robust commercial loan growth and strong credit metrics and most importantly, the completion of our transformative merger with First Midwest,” said CEO Jim Ryan. “We are positioned well for continued growth and investments that will benefit our clients, team members, communities and shareholders.”

    FIRST QUARTER HIGHLIGHTS2:


    Net Income
    • Net loss applicable to common shares of $29.6 million; adjusted net income applicable to common shares1 of $91.6 million
    • Earnings per diluted common share ("EPS") of $(0.13); adjusted EPS1 of $0.40
      

    Net Interest
    Income/NIM
    • Net interest income on a fully taxable equivalent basis1 of $226.6 million
    • Net interest margin on a fully taxable equivalent basis1 ("NIM") of 2.88%
      



    Operating
    Performance



    • Pre-provision net revenue1 (“PPNR”) of $65.1 million; adjusted PPNR1 of $118.6 million
    • Noninterest expense of $226.7 million; adjusted noninterest expense1 of $172.9 million
    • Efficiency ratio1 of 76.2%; adjusted efficiency ratio1 of 57.7%
      







    Loans and
    Credit
    Quality
    • End-of-period total loans3 of $28.4 billion compared to $13.6 billion at December 31
    • Increased commercial loans 8.3% annualized on a full first quarter combined basis1,4, excluding PPP loans and acquisition accounting adjustments
    • Total full quarter combined4 commercial production of $1.5 billion
    • March 31 pipeline of $5.4 billion
    • Provision for credit losses ("provision") of $97.6 million; $96.3 million of current expected credit loss ("CECL") Day 1 non-purchased credit deteriorated ("non-PCD") provision expense5
    • Net charge-offs of $2.8 million, or 5 basis points ("bps") of average loans
    • Non-performing loans of 0.88% of total loans
     

    Return
    Profile &
    Capital
    • Return on average tangible common equity1 of (4.0)%; adjusted return on average tangible common equity1 of 15.0%
    • Repurchased 3.5 million shares of common stock at a cost of $63.8 million during the quarter
      




    Notable
    Items
    • $96.3 million of CECL Day 1 non-PCD provision expense5
    • $52.3 million of merger-related charges
    • $1.5 million of tax credit amortization

    1 Non-GAAP financial measure that management believes is useful in evaluating the financial results of the Company – refer to the Non-GAAP reconciliations contained in this release 2 Comparisons to legacy prior periods are not meaningful due to merger 3 Includes loans held for sale 4 Excludes Paycheck Protection Program ("PPP") loans and acquisition accounting adjustments ("AAAs") for legacy First Midwest and combined Old National - growth annualized for the combined full quarter 5 Refers to the initial increase in allowance for credit losses required on acquired non-PCD loans through the provision for credit losses

    MERGER TRANSACTION

    On February 15, 2022, Old National Bancorp ("Old National") completed its transformative merger with First Midwest Bancorp, Inc. ("First Midwest") to create the premier bank in the Midwest. The merger added approximately $22 billion of assets, $14 billion of loans, and $17 billion of deposits. The combined company ranks among the top 35 banking companies based in the United States and creates the sixth largest commercial bank headquartered in the Midwest based on assets, with approximately $46 billion of combined assets, $31 billion of assets under management, strong commercial banking capabilities, a robust retail footprint, and a significant wealth platform.

    RESULTS OF OPERATIONS

    Old National (NASDAQ: ONB) reported first quarter 2022 net loss applicable to common shares of $29.6 million, or $(0.13) per diluted share.

    Included in the first quarter were pre-tax charges of $96.3 million of CECL Day 1 non-PCD provision expense related to the allowance established on acquired non-PCD loans and $52.3 million of expenses related to the merger with First Midwest, including $11.0 million attributable to the provision for unfunded commitments. Excluding these charges and debt securities gains from the current quarter, adjusted net income was $91.6 million, or $0.40 per diluted share.

    LOANS
    Loan growth and expanding presence driven by the merger, along with strong combined commercial production and growth.

    • Period-end total loans3 were $28.4 billion at March 31, 2022, up from $13.6 billion at December 31, 2021, driven by the merger and strong commercial production.
    • Paycheck Protection Program ("PPP") loans increased $36.3 million to $205.3 million at March 31, 2022, compared to $169.0 million at December 31, 2021, as a result of the merger.
    • On a first full quarter combined basis1,4, excluding PPP loans and acquisition accounting adjustments, total loans increased 6.2%, annualized, and total commercial loans increased 8.3%, annualized.
    • Full first quarter combined total commercial loan production was $1.5 billion; period-end pipeline totaled $5.4 billion.
    • Consumer loans increased to $2.7 billion and residential mortgage loans increased to $5.7 billion, driven by the merger and partially offset by acquired transactional portfolio run-off.
    • Average total loans in the first quarter were $20.7 billion, an increase of $7.1 billion from the fourth quarter of 2021 and $7.2 billion excluding PPP loans.

    DEPOSITS
    Strong deposit franchise bolstered by merger, partially offset by normal seasonality.

    • Period-end total deposits were $35.6 billion at March 31, 2022, compared to $18.6 billion at December 31, 2021.
    • Full first quarter combined total deposits balances were stable as a seasonal decline in commercial and municipal deposits as well as a decrease in time deposits in light of the current market environment was partly offset by growth in retail interest-bearing deposits.
    • On average, total deposits in the first quarter increased to $26.9 billion, compared to $18.4 billion for the fourth quarter of 2021.

    NET INTEREST INCOME AND MARGIN
    Increase in earning assets from the merger favorably impact net interest income and margin, offsetting the continued decline of PPP interest and fees, as well as fewer days in the quarter.

    • Net interest income on a fully taxable equivalent basis increased to $226.6 million in the first quarter of 2022 compared to $150.2 million in the fourth quarter of 2021, driven by the merger and loan growth, partially offset by lower PPP interest and fees, as well as fewer days in the quarter.
    • Net interest margin on a fully taxable equivalent basis increased 11 bps to 2.88% compared to 2.77% in the fourth quarter of 2021, driven by the mix of interest-earning assets added in the merger, higher accretion and loan growth, partially offset by lower PPP interest and fees, excess liquidity, and fewer days in the quarter.
    • PPP interest and net fees combined were $3.7 million, or 3 bps of net interest margin, in the first quarter of 2022 compared to $7.7 million, or 11 bps of net interest margin, in the fourth quarter of 2021.
    • Accretion income on loans and borrowings was $15.9 million, or 20 bps of net interest margin, in the first quarter of 2022 compared to $3.9 million, or 7 bps of net interest margin, in the fourth quarter of 2021.
    • Interest collected on nonaccrual loans was $1.1 million, or 1 bp of net interest margin, in the first quarter of 2022 compared to $1.4 million, or 3 bps of net interest margin, in the fourth quarter of 2021.
    • The cost of total deposits was consistent at 0.05% in the first quarter of 2022 and the cost of total interest-bearing deposits declined 1 bp to 0.07%.

    CREDIT QUALITY
    Strong credit quality continues to be a hallmark of the Old National franchise.

    • Old National recorded a provision expense in the first quarter of 2022 of $97.6 million, which included $96.3 million of CECL Day 1 non-PCD provision expense related to the allowance for credit losses established on acquired non-PCD loans, compared to $1.9 million of provision recapture recorded in the fourth quarter of 2021.
    • Net charge-offs in the first quarter were $2.8 million on PCD loans, or 5 bps of average loans, compared to net recoveries of $1.4 million in the fourth quarter of 2021, or 3 bps of average loans.
    • 30+ day delinquencies were 0.34% at the end of the first quarter, up from 0.11% at the end of the fourth quarter due to loans in process of renewal that have subsequently been completed.
    • Non-performing loans improved as a percentage of total loans to 0.88% from 0.92% at the end of the fourth quarter due to the merger.
    • Loans acquired from previous acquisitions were recorded at fair value at the acquisition date. As of March 31, 2022, the remaining discount on these acquired loans was $162 million, $132 million related to First Midwest.
    • The allowance for credit losses stood at $280.5 million, or 0.99% of total loans at March 31, 2022, up from 0.79% at December 31, 2021 due to the merger, which included $96.3 million of CECL Day 1 non-PCD provision expense related to acquired non-PCD loans and $78.5 million of allowance related to acquired PCD loans .

    NONINTEREST INCOME
    Noninterest income increase driven by merger; mortgage banking revenue seasonally lower and capital markets income declines.

    • Total noninterest income for the first quarter of 2022 was $65.2 million, an increase of $13.8 million from the fourth quarter of 2021 driven by the merger.
    • Mortgage banking revenue impacted by the rate environment, normalizing gain on sale margins, and a higher mix of portfolio production.

    NONINTEREST EXPENSE
    Increase in first quarter due to merger; expenses well controlled.

    • Noninterest expense for the first quarter of 2022 was $226.7 million and included $52.3 million of merger-related charges, including $11.0 million attributable to the provision for unfunded commitments, as well as $1.5 million of tax credit amortization.
    • Excluding these items, adjusted noninterest expense for the first quarter was $172.9 million, compared to the $123.2 million of adjusted noninterest expense in the fourth quarter of 2021.
    • The first quarter efficiency ratio was 76.2%, while the adjusted efficiency ratio was 57.7% compared to 59.9% for the fourth quarter of 2021.

    INCOME TAXES

    • On a fully taxable-equivalent basis, income tax benefit in the first quarter was $4.9 million, resulting in a 15.2% FTE tax rate, compared to 21.6% in the fourth quarter of 2021.
    • Income tax expense included $2.1 million of tax benefits related to the vesting of share-based payments and post-merger remeasurement of deferred tax assets.
    • Income tax expense included $1.6 million of tax credit benefit.

    CAPITAL AND LIQUIDITY
    Capital ratios remain strong.

    • Preliminary total risk-based capital was 12.19% and preliminary regulatory Tier 1 capital was 10.79%, impacted by the merger and loan growth.
    • Tangible common equity to tangible assets was 6.51% at the end of the first quarter compared to 8.30% in the fourth quarter of 2021, impacted by the merger and rate environment's impact on unrealized losses within the investment portfolio.
    • The Company repurchased 3.5 million shares of common stock during the quarter.
    • A low loan to deposit ratio of 79.7%, combined with existing funding sources plus available unencumbered, high-quality collateral, provides strong liquidity.

    NON-GAAP RECONCILIATIONS

    ($ in millions, except EPS, shares in 000s)1Q22Adjustments6,7Adjusted 1Q22
    Total Revenues (FTE)$291.8 $(0.3)$291.5 
    Less: Provision for Credit Losses (97.6) 96.3  (1.3)
    Less: Noninterest Expenses (226.7) 52.3  (174.4)
    Income before Income Taxes (FTE)$(32.5)$148.3 $115.8 
    Income Taxes (FTE) 4.9  (27.1) (22.2)
    Net Income (loss)$(27.6)$121.2 $93.6 
    Preferred Dividends (2.0) —  (2.0)
    Net Income (loss) applicable to common shares$(29.6)$121.2 $91.6 
    Average Shares Outstanding 227,002  —  227,002 
    Earnings Per Share - Diluted$(0.13)$0.53 $0.40 

    6 Tax-effect calculations use management's estimate of the full year FTE tax rates (federal + state)
    7 Provision for Credit Losses adjustment refers to the initial increase in allowance for credit losses required on acquired non-PCD loans through the provision for credit losses as a result of the completed merger

    ($ in millions)1Q224Q21
    Net Interest Income$222.8 $146.8 
    Add: FTE Adjustment 3.8  3.4 
    Net Interest Income (FTE)$226.6 $150.2 
    Average Earning Assets$31,483.6 $21,670.7 
    Net Interest Margin (FTE) 2.88% 2.77%


    ($ in millions)1Q221Q21
    Net Interest Income$222.8 $148.1 
    Add: FTE Adjustment 3.8  3.5 
    Net Interest Income (FTE)$226.6 $151.6 
    Add: Total Noninterest Income 65.2  56.7 
    Less: Noninterest Expense 226.7  117.7 
    Pre-Provision Net Revenue$65.1 $90.6 
    Less: Debt Securities Gains/Losses (0.3) (2.0)
    Add: Merger-Related Charges 52.3  — 
    Add: ONB Way Charges —  1.5 
    Add: Amortization of Tax Credit Investments 1.5  1.2 
    Adjusted Pre-Provision Net Revenue$118.6 $91.3 


    ($ in millions)1Q224Q21
    Old National Commercial Loans$19,962.0 $9,772.4 
    Less: Old National PPP Loans (205.3) (169.0)
    Legacy First Midwest Commercial Loans —  10,048.9 
    Less: Legacy First Midwest PPP Loans —  (230.7)
    Less: Commercial AAAs 69.8  — 
    Historical Combined Commercial Loans$19,826.5 $19,421.6 
    Old National Consumer and Residential Real Estate Loans 8,374.3  3,829.4 
    First Midwest Consumer and Residential Real Estate Loans —  4,540.7 
    Add: Consumer and Residential Real Estate AAAs 61.7  38.8 
    Historical Combined Total Loans$28,262.5 $27,830.5
    		 


    ($ in millions)1Q224Q211Q21
    Noninterest Expense$226.7 $131.9 $117.7 
    Less: ONB Way Charges —  —  (1.5)
    Less: Merger-Related Charges (52.3) (6.7) — 
    Noninterest Expense less Charges$174.4 $125.2 $116.2 
    Less: Amortization of Tax Credit Investments (1.5) (2.0) (1.2)
    Adjusted Noninterest Expense$172.9 $123.2 $115.0 
    Less: Intangible Amortization (4.8) (2.6) (3.1)
    Adjusted Noninterest Expense Less Intangible Amortization$168.1 $120.6 $111.9 
    Net Interest Income$222.8 $146.8 $148.1 
    FTE Adjustment 3.8  3.4  3.5 
    Net Interest Income (FTE)$226.6 $150.2 $151.6 
    Total Noninterest Income 65.2  51.5  56.7 
    Total Revenue (FTE)$291.8 $201.7 $208.3 
    Less: Debt Securities Gains/Losses (0.3) (0.4) (2.0)
    Adjusted Total Revenue (FTE)$291.5 $201.3 $206.3 
    Efficiency Ratio 76.2% 64.3% 55.6%
    Adjusted Efficiency Ratio 57.7% 59.9% 54.3%

                    

    ($ in millions)1Q224Q21
    Net (Loss) Income Applicable to Common Shares$(29.6)$56.2 
    Add: Intangible Amortization (net of tax6) 3.9  1.9 
    Tangible Net (Loss) Income Applicable to Common Shares$(25.7)$58.1 
    Less: Securities Gains/Losses (net of tax6) (0.2) (0.3)
    Add: Provision for credit losses - CECL Day 1 non-PCD provision expense7 (net of tax6) 78.6  — 
    Add: Merger-Related Charges (net of tax6) 42.8  5.0 
    Adjusted Tangible Net Income Applicable to Common Shares$95.5 $62.8 
    Average Shareholders’ Common Equity 4,101.2  2,998.8 
    Less: Average Goodwill (1,476.7) (1,037.0)
    Less: Average Intangibles (73.9) (36.0)
    Average Tangible Shareholders’ Common Equity$2,550.6 $1,925.8 
    Return on Average Common Equity(2.9)% 7.5%
    Adjusted Return on Average Common Equity 8.9% 8.1%
    Return on Average Tangible Common Equity(4.0)% 12.1%
    Adjusted Return on Average Tangible Common Equity 15.0% 13.0%

    CONFERENCE CALL AND WEBCAST
    Old National will host a conference call and live webcast at 9:00 a.m. Central Time on Tuesday, April 26, 2022, to review first quarter 2022 financial results. The live audio webcast link and corresponding presentation slides will be available on the Company’s Investor Relations web page at oldnational.com and will be archived there for 12 months. To listen to the live conference call, dial U.S. (844) 200-6205 or International (929) 526-1599, Access code 656831. A replay of the call will also be available from noon Central Time on April 26 through May 10. To access the replay, dial U.S. (866) 813-9403 or international +44 (204) 525-0658, Access code 729800.

    ABOUT OLD NATIONAL
    Old National Bancorp (NASDAQ: ONB), the holding company of Old National Bank, recently completed its transformative merger with First Midwest Bancorp, Inc. to create the sixth largest commercial bank headquartered in the Midwest. With approximately $46 billion of assets and $31 billion of assets under management, Old National ranks among the top thirty-five banking companies based in the U.S. and has been recognized as a World’s Most Ethical Company by the Ethisphere Institute for eleven consecutive years.  Since its founding in 1834, Old National Bank has focused on community banking by building long-term, highly valued partnerships with clients and in the communities it serves. In addition to providing extensive services in retail and commercial banking, Old National offers comprehensive wealth management, investment, and capital market services. For more information and financial data, please visit Investor Relations at oldnational.com.

    USE OF NON-GAAP FINANCIAL MEASURES
    The Company's accounting and reporting policies conform to U.S. generally accepted accounting principles ("GAAP") and general practices within the banking industry. As a supplement to GAAP, the Company provides non-GAAP performance results, which the Company believes are useful because they assist investors in assessing the Company's operating performance. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in the tables of this release.

    The Company presents EPS, the efficiency ratio, return on average common equity, and return on average tangible common equity, all adjusted for certain notable items. These items include the CECL Day 1 non-PCD provision expense, merger related charges associated with completed acquisitions, ONB Way charges, and net securities gains. Management believes excluding these items from EPS, the efficiency ratio, return on average common equity, and return on average tangible common equity may be useful in assessing the Company's underlying operational performance since these transactions do not pertain to its core business operations and their exclusion may facilitate better comparability between periods. Management believes that excluding merger related charges and the CECL Day 1 non-PCD provision expense from these metrics may be useful to the Company, as well as analysts and investors, since these expenses can vary significantly based on the size, type, and structure of each acquisition. Additionally, management believes excluding these items from these metrics may enhance comparability for peer comparison purposes.

    The Company presents loans excluding PPP loans on a historical combined basis and excluding acquisition accounting adjustments. Management believes that comparisons of balance sheet balances to legacy periods are not meaningful due to the merger with First Midwest. Additionally, management believes that excluding acquisition accounting adjustments may be useful to the Company, as well as analysts and investors, since these adjustments can vary significantly based on the size, type, and structure of each acquisition.

    Income tax expense, provision for credit losses, and the certain notable items listed above are excluded from the calculation of pre-provision net revenues, adjusted due to the fluctuation in income before income tax and the level of provision for credit losses required. Management believes pre-provision net revenues, adjusted may be useful in assessing the Company's underlying operational performance and their exclusion may facilitate better comparability between periods and for peer comparison purposes.

    The Company presents adjusted noninterest expense, which excludes merger related charges, ONB Way charges and amortization of tax credit investments. Management believes that excluding these items from noninterest expense may be useful in assessing the Company’s underlying operational performance as these items either do not pertain to its core business operations or their exclusion may facilitate better comparability between periods and for peer comparison purposes.

    The tax-equivalent adjustment to net interest income and net interest margin recognizes the income tax savings when comparing taxable and tax-exempt assets. Interest income and yields on tax-exempt securities and loans are presented using the current federal income tax rate of 21%. Management believes that it is standard practice in the banking industry to present net interest income and net interest margin on a fully tax-equivalent basis and that it may enhance comparability for peer comparison purposes.

    In management's view, tangible common equity measures are capital adequacy metrics that may be meaningful to the Company, as well as analysts and investors, in assessing the Company's use of equity and in facilitating comparisons with peers. These non-GAAP measures are valuable indicators of a financial institution's capital strength since they eliminate intangible assets from stockholders' equity and retain the effect of accumulated other comprehensive loss in stockholders' equity.

    Although intended to enhance investors' understanding of the Company's business and performance, these non-GAAP financial measures should not be considered an alternative to GAAP. In addition, these non-GAAP financial measures may differ from those used by other financial institutions to assess their business and performance. See the previously provided tables and the following reconciliations in the "Non-GAAP Reconciliations" section for details on the calculation of these measures to the extent presented herein.

    FORWARD-LOOKING STATEMENTS
    This communication contains certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, descriptions of Old National’s financial condition, results of operations, asset and credit quality trends, profitability and business plans or opportunities. Forward-looking statements can be identified by the use of the words "anticipate," "believe," "contemplate," "could," "estimate," "expect," "intend," "may," "outlook," "plan," "should," and "will," and other words of similar meaning. These forward-looking statements express management’s current expectations or forecasts of future events and, by their nature, are subject to risks and uncertainties. There are a number of factors that could cause actual results or outcomes to differ materially from those in such statements. Factors that might cause such a difference include, but are not limited to: the continued impact of the COVID-19 pandemic on our business as well as the business of our customers; competition; government legislation, regulations and policies; ability of Old National to execute its business plan, including the completion of the integration and systems conversion related to the merger between Old National and First Midwest and the achievement of the synergies and other benefits from the merger; changes in the economy which could materially impact credit quality trends and the ability to generate loans and gather deposits; failure or circumvention of our internal controls; significant changes in accounting, tax or regulatory practices or requirements; new legal obligations; disruptive technologies in payment systems and other services traditionally provided by banks; failure or disruption of our information systems; computer hacking and other cybersecurity threats; other matters discussed in this communication; and other factors identified in our Annual Report on Form 10-K for the year ended December 31, 2021 and other filings with the Securities and Exchange Commission. These forward-looking statements are made only as of the date of this communication and are not guarantees of future results or performance, and Old National does not undertake an obligation to update these forward-looking statements to reflect events or conditions after the date of this communication.

    CONTACTS:  
    Media: Maurissa Kanter Investors: Lynell Walton
    (708) 831-7345 (812) 464-1366
    Maurissa.Kanter@firstmidwest.com Lynell.Walton@oldnational.com


        
    Financial Highlights (unaudited)
    ($ and shares in thousands, except per share data)
        
     Three Months Ended
     March 31,December 31,March 31,
     202220212021
    Income Statement   
    Net interest income$222,785 $146,781 $148,120 
    Tax equivalent adjustment (1) 3,772  3,442  3,500 
    Net interest income - tax equivalent basis 226,557  150,223  151,620 
    Provision for credit losses 97,569  (1,914) (17,356)
    Noninterest income 65,240  51,484  56,712 
    Noninterest expense 226,756  131,937  117,740 
    Net income (loss) available to common shareholders (29,603) 56,188  86,818 
        
        
    Per Common Share Data   
    Weighted average diluted shares 227,002  166,128  165,707 
    Net income (loss) (diluted)$(0.13)$0.34 $0.52 
    Cash dividends 0.14  0.14  0.14 
    Common dividend payout ratio (2)(108)% 41% 26%
    Book value$17.03 $18.16 $17.98 
    Stock price 16.38  18.12  19.34 
    Tangible common book value (3) 9.71  11.70  11.47 
        
        
    Performance Ratios   
    Return on average assets(0.3)% 0.9% 1.5%
    Return on average common equity(2.9)% 7.5% 11.7%
    Return on average tangible common equity (3)(4.0)% 12.1% 18.9%
    Net interest margin (FTE) 2.88% 2.77% 2.94%
    Efficiency ratio (4) 76.2% 64.3% 55.6%
    Net charge-offs (recoveries) to average loans 0.05%(0.04)% 0.00%
    Allowance for credit losses to ending loans 0.99% 0.79% 0.82%
    Non-performing loans to ending loans 0.88% 0.92% 1.13%
        
        
    Balance Sheet (EOP)   
    Total loans$28,336,244 $13,601,846 $13,925,261 
    Total assets 45,834,648  24,453,564  23,744,451 
    Total deposits 35,607,390  18,569,195  17,849,755 
    Total borrowed funds 4,347,560  2,575,240  2,574,987 
    Total shareholders' equity 5,232,114  3,012,018  2,979,447 
        
        
    Capital Ratios (3)   
    Risk-based capital ratios (EOP):   
    Tier 1 common equity 10.04% 12.04% 12.01%
    Tier 1 10.79% 12.04% 12.01%
    Total 12.19% 12.77% 12.84%
    Leverage ratio (to average assets) 10.58% 8.59% 8.33%
        
    Total equity to assets (averages) 12.03% 12.35% 12.78%
    Tangible common equity to tangible assets 6.51% 8.30% 8.38%
        
        
    Nonfinancial Data   
    Full-time equivalent employees 4,333  2,374  2,451 
    Banking centers 267  162  162 
        
    (1) Calculated using the federal statutory tax rate in effect of 21% for all periods. 
    (2) Cash dividends per common share divided by net income per common share (basic).
    (3) Represents a non-GAAP financial measure. Refer the "Non-GAAP Measures" table for reconciliations to GAAP financial measures.
    March 31, 2022 capital ratios are preliminary.   
    (4) Efficiency ratio is defined as noninterest expense before amortization of intangibles as a percent of FTE net interest income and
    noninterest revenues, excluding net gains from debt securities transactions. This presentation excludes amortization of intangibles
    and net debt securities gains, as is common in other company releases, and better aligns with true operating performance.
    FTE - Fully taxable equivalent basis      EOP - End of period actual balances        PCD - Purchased credit deteriorated


        
    Income Statement (unaudited)
    ($ and shares in thousands, except per share data)
        
     Three Months Ended
     March 31,December 31,March 31,
     202220212021
    Interest income$235,505 $156,928 $159,237 
    Less: interest expense 12,720  10,147  11,117 
    Net interest income 222,785  146,781  148,120 
    Provision for credit losses 97,569  (1,914) (17,356)
    Net interest income after provision for credit losses 125,216  148,695  165,476 
        
    Wealth management fees 14,630  9,833  9,708 
    Service charges on deposit accounts 14,726  9,121  8,124 
    Debit card and ATM fees 6,899  5,071  5,143 
    Mortgage banking revenue 7,245  7,336  16,525 
    Investment product fees 7,322  6,258  5,864 
    Capital markets income 4,442  6,394  3,715 
    Company-owned life insurance 3,524  2,737  2,714 
    Other income 6,110  4,299  2,926 
    Gains (losses) on sales of debt securities 342  435  1,993 
    Total noninterest income 65,240  51,484  56,712 
        
    Salaries and employee benefits 124,147  72,336  68,117 
    Occupancy 21,019  13,151  14,872 
    Equipment 5,168  4,473  3,969 
    Marketing 4,276  4,723  2,062 
    Data processing 18,762  11,489  12,353 
    Communication 3,417  2,412  2,878 
    Professional fees 19,791  5,409  2,724 
    FDIC assessment 2,575  1,598  1,607 
    Amortization of intangibles 4,811  2,573  3,075 
    Amortization of tax credit investments 1,516  2,019  1,202 
    Other expense 21,274  11,754  4,881 
    Total noninterest expense 226,756  131,937  117,740 
        
    Income (loss) before income taxes (36,300) 68,242  104,448 
    Income tax expense (benefit) (8,714) 12,054  17,630 
    Net income (loss)$(27,586)$56,188 $86,818 
    Preferred dividends (2,017) —  — 
    Net income (loss) applicable to common shares$(29,603)$56,188 $86,818 
        
    Diluted Earnings Per Common Share    
    Net income (loss)$(0.13)$0.34 $0.52 
        
    Average Common Shares Outstanding   
    Basic 227,002  165,278  164,997 
    Diluted 227,002  166,128  165,707 
        
    Common shares outstanding at end of period 292,959  165,838  165,676 
        


     
    End of Period Balance Sheet (unaudited)
    ($ in thousands)
     March 31, December 31, March 31,
     2022 2021 2021
    Assets     
    Federal Reserve Bank account$1,545,389  $627,354  $293,230 
    Money market investments 12,419   22,002   10,217 
    Investments:     
    Treasury and government-sponsored agencies 2,527,568   1,778,357   1,602,423 
    Mortgage-backed securities 6,086,853   3,698,831   3,385,339 
    States and political subdivisions 1,840,823   1,654,986   1,467,804 
    Other securities 735,550   432,478   440,810 
    Total investments 11,190,794   7,564,652   6,896,376 
    Loans held for sale, at fair value 39,376   35,458   50,281 
    Loans:     
    Commercial 8,624,253   3,391,769   4,068,896 
    Commercial and agriculture real estate 11,337,735   6,380,674   6,074,135 
    Consumer:     
    Home equity 1,080,885   560,590   541,149 
    Other consumer loans 1,587,216   1,013,524   1,037,804 
    Subtotal of commercial and consumer loans 22,630,089   11,346,557   11,721,984 
    Residential real estate 5,706,155   2,255,289   2,203,277 
    Total loans 28,336,244   13,601,846   13,925,261 
    Total earning assets 41,124,222   21,851,312   21,175,365 
          
    Allowance for credit losses on loans (280,507)  (107,341)  (114,037)
    Non-earning Assets:     
    Cash and due from banks 418,744   172,663   154,330 
    Premises and equipment, net 584,113   476,186   466,559 
    Operating lease right-of-use assets 201,802   69,560   74,611 
    Goodwill and other intangible assets 2,144,609   1,071,672   1,079,933 
    Company-owned life insurance 766,291   463,324   456,782 
    Other assets 875,374   456,188   450,908 
    Total non-earning assets 4,990,933   2,709,593   2,683,123 
    Total assets$45,834,648  $24,453,564  $23,744,451 
          
    Liabilities and Equity     
    Noninterest-bearing demand deposits$12,463,136  $6,303,106  $6,091,054 
    Interest-bearing:     
    Checking and NOW accounts 8,296,337   5,338,022   4,933,770 
    Savings accounts 6,871,767   3,798,494   3,631,145 
    Money market accounts 5,432,139   2,169,160   2,075,852 
    Other time deposits 2,544,011   960,413   1,042,903 
    Total core deposits 35,607,390   18,569,195   17,774,724 
    Brokered deposits —   —   75,031 
    Total deposits 35,607,390   18,569,195   17,849,755 
          
    Federal funds purchased and interbank borrowings 1,721   276   922 
    Securities sold under agreements to repurchase 509,275   392,275   395,242 
    Federal Home Loan Bank advances 3,239,357   1,886,019   1,912,541 
    Other borrowings 597,207   296,670   266,282 
    Total borrowed funds 4,347,560   2,575,240   2,574,987 
    Operating lease liabilities 234,049   76,236   84,665 
    Accrued expenses and other liabilities 413,535   220,875   255,597 
    Total liabilities 40,602,534   21,441,546   20,765,004 
    Preferred stock, common stock, surplus, and retained earnings 5,570,313   3,014,393   2,887,538 
    Accumulated other comprehensive income (loss), net of tax (338,199)  (2,375)  91,909 
    Total shareholders' equity 5,232,114   3,012,018   2,979,447 
    Total liabilities and shareholders' equity$45,834,648  $24,453,564  $23,744,451 
     


                 
    Average Balance Sheet and Interest Rates (unaudited)
    ($ in thousands)
                 
                 
      Three Months Ended Three Months Ended Three Months Ended
      March 31, 2022 December 31, 2021 March 31, 2021
      AverageIncome (1)/Yield/ AverageIncome (1)/Yield/ AverageIncome (1)/Yield/
    Earning Assets: BalanceExpenseRate BalanceExpenseRate BalanceExpenseRate
    Money market and other interest-earning            
    investments $1,336,404 $3080.09% $726,144 $2760.15% $370,087 $880.10%
    Investments:            
    Treasury and government-sponsored agencies  2,195,470  8,2191.50%  1,763,544  6,3901.45%  1,155,525  4,8851.69%
    Mortgage-backed securities  4,869,038  24,3772.00%  3,513,482  15,0711.72%  3,312,311  15,8331.91%
    States and political subdivisions  1,738,652  13,6373.14%  1,625,390  12,9413.18%  1,478,143  12,2003.30%
    Other securities  605,552  4,1442.74%  438,583  2,6082.38%  453,411  2,7432.42%
    Total investments  9,408,712  50,3772.14%  7,340,999  37,0102.02%  6,399,390  35,6612.23%
    Loans: (2)            
    Commercial  5,893,907  55,2833.75%  3,420,274  31,6413.62%  3,974,762  35,5683.58%
    Commercial and agriculture real estate  8,749,162  77,4083.54%  6,341,296  57,3473.54%  5,980,774  55,7463.73%
    Consumer:            
    Home equity  783,729  7,3553.81%  556,851  4,3803.12%  544,049  4,1523.10%
    Other consumer loans  1,320,923  14,5604.47%  1,009,690  9,4883.73%  1,058,731  10,1753.90%
    Subtotal commercial and consumer loans  16,747,721  154,6063.74%  11,328,111  102,8563.60%  11,558,316  105,6413.71%
    Residential real estate loans  3,990,716  33,9863.41%  2,275,469  20,2283.56%  2,273,859  21,3473.76%
                 
    Total loans  20,738,437  188,5923.64%  13,603,580  123,0843.56%  13,832,175  126,9883.68%
                 
    Total earning assets $31,483,553 $239,2773.04% $21,670,723 $160,3702.93% $20,601,652 $162,7373.16%
                 
    Less: Allowance for credit losses on loans  (168,175)    (107,990)    (133,869)  
                 
    Non-earning Assets:            
    Cash and due from banks $268,836    $228,126    $288,623   
    Other assets  3,480,640     2,481,792     2,486,604   
                 
    Total assets $35,064,854    $24,272,651    $23,243,010   
                 
    Interest-Bearing Liabilities:            
    Checking and NOW accounts $6,784,653 $5960.04% $5,093,496 $4580.04% $4,863,819 $6120.05%
    Savings accounts  5,302,015  5890.05%  3,766,543  5240.06%  3,495,319  4870.06%
    Money market accounts  3,778,682  6910.07%  2,139,702  4560.08%  1,987,348  4230.09%
    Other time deposits  1,745,153  1,3180.31%  978,723  1,0470.42%  1,081,248  1,6070.60%
    Total interest-bearing core deposits  17,610,503  3,1940.07%  11,978,464  2,4850.08%  11,427,734  3,1290.11%
    Brokered deposits  —  —0.00%  —  —0.00%  157,780  300.08%
    Total interest-bearing deposits  17,610,503  3,1940.07%  11,978,464  2,4850.08%  11,585,514  3,1590.11%
                 
    Federal funds purchased and interbank borrowings  1,113  —0.01%  1,162  —0.00%  1,144  —0.00%
    Securities sold under agreements to repurchase  449,939  960.09%  381,744  920.10%  398,662  1200.12%
    Federal Home Loan Bank advances  2,589,984  5,9630.93%  1,887,821  5,1221.08%  1,925,352  5,4091.14%
    Other borrowings  432,434  3,4673.21%  274,926  2,4483.56%  263,010  2,4293.69%
    Total borrowed funds  3,473,470  9,5261.11%  2,545,653  7,6621.19%  2,588,168  7,9581.25%
                 
    Total interest-bearing liabilities $21,083,973 $12,7200.24% $14,524,117 $10,1470.28% $14,173,682 $11,1170.32%
                 
    Noninterest-Bearing Liabilities and Shareholders' Equity            
    Demand deposits $9,294,876    $6,435,829    $5,756,277   
    Other liabilities  467,589     313,880     343,073   
    Shareholders' equity  4,218,416     2,998,825     2,969,978   
                 
    Total liabilities and shareholders' equity $35,064,854    $24,272,651    $23,243,010   
                 
    Net interest rate spread   2.80%   2.65%   2.84%
                 
    Net interest margin (FTE)   2.88%   2.77%   2.94%
                 
    FTE adjustment  $3,772   $3,442   $3,500 
                 
    (1) Interest income is reflected on a fully taxable equivalent basis (FTE). 
    (2) Includes loans held for sale. 
     


        
    Asset Quality (EOP) (unaudited)
    ($ in thousands)
        
     Three Months Ended
     March 31,December 31,March 31,
     202220212021
    Allowance for credit losses on loans:   
    Beginning allowance for credit losses$107,341 $107,868 $131,388 
    Allowance established for acquired PCD loans 78,531  —  — 
        
    Provision for credit losses(1) 97,409  (1,914) (17,356)
        
    Gross charge-offs (4,664) (545) (1,570)
    Gross recoveries 1,890  1,932  1,575 
    Net (charge-offs) recoveries (2,774) 1,387  5 
        
    Ending allowance for credit losses$280,507 $107,341 $114,037 
        
    Net charge-offs (recoveries) / average loans(2) 0.05%(0.04)        % 0.00%
        
    Average loans outstanding(2)$20,725,313 $13,594,543 $13,815,515 
        
    EOP loans outstanding(2) 28,336,244  13,601,846  13,925,261 
        
    Allowance for credit losses / EOP loans(2) 0.99% 0.79% 0.82%
        
    Underperforming Assets:   
    Loans 90 Days and over (still accruing)$1,646 $7 $49 
        
    Non-performing loans:   
    Nonaccrual loans(3) 227,925  106,691  142,138 
    TDRs still accruing 20,999  18,378  15,226 
    Total non-performing loans 248,924  125,069  157,364 
        
    Foreclosed assets 19,713  2,030  751 
        
    Total underperforming assets$270,283 $127,106 $158,164 
        
    Classified and Criticized Assets:   
    Nonaccrual loans(3) 227,925  106,691  142,138 
    Substandard accruing loans 518,341  162,572  160,314 
    Loans 90 days and over (still accruing) 1,646  7  49 
    Total classified loans - "problem loans"$747,912 $269,270 $302,501 
        
    Other classified assets 24,676  4,338  3,791 
    Criticized loans - "special mention loans" 507,689  235,910  246,365 
        
    Total classified and criticized assets$1,280,277 $509,518 $552,657 
        
    Non-performing loans / EOP loans(2) 0.88% 0.92% 1.13%
        
    Allowance to non-performing loans 113% 86% 72%
        
    Under-performing assets / EOP loans(2) 0.95% 0.93% 1.14%
        
    EOP total assets$45,834,648 $24,453,564 $23,744,451 
        
    Under-performing assets / EOP assets 0.59% 0.52% 0.67%
        
    EOP - End of period actual balances   
    (1) Excludes $0.2 million of expense to establish an allowance on held-to-maturity securities during the first quarter of 2022.
    (2) Excludes loans held for sale. 
    (3) Includes non-accruing TDRs totaling $23.8 million at March 31, 2022, $11.7 million at December 31, 2021, and $14.3 million at March 31, 2021.
        


        
    Non-GAAP Measures (unaudited)
    ($ in thousands)
        
     Three Months Ended
     March 31,December 31,March 31,
     202220212021
    Actual End of Period Balances   
    GAAP shareholders' common equity$4,988,395 $3,012,018 $2,979,447 
        
    Deduct:   
    Goodwill 1,997,157  1,036,994  1,036,994 
    Intangibles 147,452  34,678  42,939 
      2,144,609  1,071,672  1,079,933 
        
    Tangible shareholders' common equity $2,843,786 $1,940,346 $1,899,514 
        
    Average Balances   
    GAAP shareholders' common equity$4,101,206 $2,998,825 $2,969,978 
        
    Deduct:   
    Goodwill 1,476,726  1,036,994  1,036,994 
    Intangibles 73,898  35,992  44,409 
      1,550,624  1,072,986  1,081,403 
        
    Average tangible shareholders' common equity $2,550,582 $1,925,839 $1,888,575 
        
    Actual End of Period Balances   
    GAAP assets$45,834,648 $24,453,564 $23,744,451 
        
    Add:   
    Trust overdrafts 1  —  24 
        
    Deduct:   
    Goodwill 1,997,157  1,036,994  1,036,994 
    Intangibles 147,452  34,678  42,939 
      2,144,609  1,071,672  1,079,933 
        
    Tangible assets $43,690,040 $23,381,892 $22,664,542 
        
    Risk-weighted assets (2)$32,341,335 $16,588,469 $15,524,621 
        
    GAAP net income (loss) applicable to common shares$(29,603)$56,188 $86,818 
        
    Add:   
    Amortization of intangibles (net of tax) 3,934  1,930  2,306 
        
    Tangible net income (loss) applicable to common shares$(25,669)$58,118 $89,124 
        
    Tangible Ratios    
    Return on average tangible common equity(4.03)        % 12.07% 18.88%
    Tangible common equity to tangible assets 6.51% 8.30% 8.38%
    Tangible common equity to risk-weighted assets (2) 8.79% 11.70% 12.24%
    Tangible common book value (1) 9.71  11.70  11.47 
        
    Tangible common equity presentation includes other comprehensive income as is common in other company releases.
    (1) Tangible common shareholders' equity divided by common shares issued and outstanding at period-end.
        
    Tier 1 common equity (2)$3,246,482 $1,998,056 $1,865,220 
        
    Risk-weighted assets (2) 32,341,335  16,588,469  15,524,621 
        
    Tier 1 common equity to risk-weighted assets (2) 10.04% 12.04% 12.01%
        
    (2) March 31, 2022 figures are preliminary.   
        

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