8-K - BY - Equibles

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): April 30, 2020

BYLINE BANCORP, INC.

(Exact Name of Registrant as Specified in Its Charter)

Delaware

(State or Other Jurisdiction

of Incorporation)

001-38139	36-3012593
(Commission<br><br><br>File Number)	(I.R.S. Employer<br><br><br>Identification No.)
180 North LaSalle Street, Suite 300
Chicago, Illinois	60601
(Address of Principal Executive Offices)	(Zip Code)

(773) 244-7000

(Registrant’s Telephone Number, Including Area Code)

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
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☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
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☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock	BY	New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

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 13(a) of the Exchange Act. ☐

Item 2.02.	Results of Operations and Financial Condition.

On April 30, 2020, Byline Bancorp, Inc. (the “Company”) issued a press release announcing its financial results for the first quarter ended March 31, 2020. A copy of the press release is attached as Exhibit 99.1 and is incorporated herein by reference.

The information included under this Item 2.02 of Form 8-K and the attached exhibit are being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in any such filing.

Item 9.01.	Financial Statements and Exhibits.

(d) Exhibits.

Exhibit<br><br><br>No.	Description
99.1	First Quarter 2020 Financial Results Press Release, dated April 30, 2020

Forward-Looking Statements

This communication contains forward-looking statements within the meaning of the U.S. federal securities laws. Forward-looking statements include, without limitation, statements concerning plans, estimates, calculations, forecasts and projections with respect to the anticipated future performance of the Company. These statements are often, but not always, made through the use of words or phrases such as ‘‘may’’, ‘‘might’’, ‘‘should’’, ‘‘could’’, ‘‘predict’’, ‘‘potential’’, ‘‘believe’’, ‘‘expect’’, ‘‘continue’’, ‘‘will’’, ‘‘anticipate’’, ‘‘seek’’, ‘‘estimate’’, ‘‘intend’’, ‘‘plan’’, ‘‘projection’’, ‘‘would’’, ‘‘annualized’’, “target” and ‘‘outlook’’, or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. Forward-looking statements involve estimates and known and unknown risks, and reflect various assumptions and involve elements of subjective judgement and analysis, which may or may not prove to be correct, and which are subject to uncertainties and contingencies outside the control of Byline and its respective affiliates, directors, employees and other representatives, which could cause actual results to differ materially from those presented in this communication.

The COVID-19 pandemic is adversely affecting us, our employees, customers, counterparties and third-party service providers, and the ultimate extent of the impacts on our business, financial position, results of operations, liquidity, and prospects is uncertain. Continued deterioration in general business and economic conditions, including further increases in unemployment rates, or turbulence in U.S. or global financial markets could adversely affect our revenues and the values of our assets and liabilities, reduce the availability of funding, lead to a tightening of credit, and further increase stock price volatility. In addition, changes to statutes, regulations, or regulatory policies or practices as a result of, or in response to COVID-19, could affect us in substantial and unpredictable ways.

No representations, warranties or guarantees are or will be made by Byline as to the reliability, accuracy or completeness of any forward-looking statements contained in this communication or that such forward-looking statements are or will remain based on reasonable assumptions. You should not place undue reliance on any forward-looking statements contained in this communication.

Certain risks and important factors that could affect Byline’s future results are identified in its Annual Report on Form 10-K and other reports filed with the Securities and Exchange Commission, including among other things under the heading “Risk Factors” in such Annual Report on Form 10-K. Any forward-looking statement speaks only as of the date on which it is made, and Byline undertakes no obligation to update any forward-looking statement, whether to reflect events or circumstances after the date on which the statement is made, to reflect new information or the occurrence of unanticipated events, or otherwise unless required under the federal securities laws.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	BYLINE BANCORP, INC.
Date: April 30, 2020	By:	/s/ Alberto J. Paracchini
	Name:	Alberto J. Paracchini
	Title:	President and Chief Executive Officer

by-ex991_6.htm

EX-99.1

Byline Bancorp, Inc. Reports First Quarter 2020 Financial Results

First Quarter 2020 Highlights

•	Net income of $3.0 million, or $0.07 per diluted share
•	Increase in provision of $0.26 per diluted share compared to prior quarter
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•	Decrease in gain on sale of loans of $0.10 per diluted share compared to prior quarter
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•	Net interest margin of 4.17%
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•	Return on average assets of 0.21%
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•	Efficiency ratio of 67.16% for the first quarter of 2020
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•	Originated loans and leases increased $149.0 million, or 5.3%, from December 31, 2019
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•	Total assets of $5.7 billion
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•	Common Equity Tier 1 to risk weighted assets of 12.24%
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Chicago, IL, April 30, 2020 – Byline Bancorp, Inc. (the “Company” or “Byline”)(NYSE: BY), the parent company of Byline Bank (the “Bank”), today reported net income of $3.0 million, or $0.07 per diluted share, for the first quarter of 2020, compared with net income of $15.9 million, or $0.41 per diluted share, for the fourth quarter of 2019, and net income of $12.6 million, or $0.34 per diluted share, for the first quarter of 2019.

Adjusted net income, which is net income excluding merger-related expenses, core system conversion expenses, and impairment charges on assets held for sale, net of tax, was $3.5 million, or $0.09 per adjusted diluted share^1^, for the first quarter of 2020, compared with $16.1 million, or $0.42 per adjusted diluted share, for the fourth quarter of 2019, and $14.0 million, or $0.38 per adjusted diluted share, for the first quarter of 2019. A reconciliation of adjusted net income and adjusted diluted earnings per share to net income and diluted earnings per share, respectively, according to accounting principles generally accepted in the United States of America (“GAAP”) is provided in the financial tables at the end of this release.

Alberto J. Paracchini, President and Chief Executive Officer of Byline, commented, “Since the emergence of the COVID-19 pandemic, we have been focused on protecting the health and safety of our employees and clients, while constructively working with our borrowers to identify the best solutions for helping them manage through this crisis. We have put in place a number of relief programs to support our clients, including participating in the Small Business Administration’s (“SBA”) Paycheck Protection Program (“PPP”). As one of the largest SBA lenders in the country, we were able to provide our clients with access to the PPP, and through April 29^th^, we have received approvals on $716.4 million in PPP loans with $385.8 million funded to date. I’m proud of the work our team did during this challenging time to establish our PPP process and support our clients.”

“Although the duration and severity of the COVID-19 pandemic is uncertain, we are well positioned from a capital and liquidity standpoint to support our clients and the communities we serve during this unprecedented period. Byline is committed to being a source of strength to our customers, employees, and communities during this uncertain time,” said Mr. Paracchini.

^1^	Represents a non-GAAP financial measure. See “Reconciliation of non-GAAP Financial Measures” for a reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measure.

Byline Bancorp, Inc.

Page 2 of 21

Byline’s Preparations and Response to Pandemic

As part of our ongoing business continuity and risk management efforts, we had previously developed a detailed plan and action measures related to a possible pandemic scenario. Our incident response team was activated on February 29, 2020 and began implementing our plan. We initiated a series of measures to ensure the safety of employees, customers, and communities, to support customer needs, and to limit operational disruptions. Our Board of Directors and management teams continue to monitor and, when appropriate, make changes to our planned response. To date we have:

•	Maximized social distancing protocols by augmenting business hours and the locations of employee teams.
•	100% of our non-retail employees have the ability to work from home.
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•	Drive-thru only locations for 25 branches, 16 full service branches with lobby hours by appointment, and 19 branches temporarily closed.
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•	Refreshed and analyzed our liquidity, funding, and capital stress forecasts including updated risk assumptions.
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•	Proactively engaged our customers and borrowers to identify short-term cash flow and other financial needs.
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•	Approved approximately $395.7 million in payment deferrals to date, or 10.3% of loans and leases at March 31, 2020.
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•	Established customer strategy to process PPP loans efficiently through our existing SBA platform.
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•	Registered over 1,400 loans totaling $372.7 million during phase one.
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•	Phase two began on April 27, 2020, with over 2,150 loans registered representing $343.7 million.
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•	Waived or refunded certain fees, including early withdrawal fees on time deposits.
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•	Took action to pause common share repurchase activities amid the uncertainty of the pandemic.
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•	Continued to serve our customers through our call center, online, and mobile banking platforms.
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Byline Bancorp, Inc.

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STATEMENTS OF OPERATIONS

Net Interest Income

The following table presents net interest income for the periods indicated:

	Three Months Ended
	March 31,		December 31,		September 30,		June 30,		March 31,
(dollars in thousands)	2020		2019		2019		2019		2019
INTEREST AND DIVIDEND INCOME
Interest and fees on loans and<br><br><br>leases	$	54,158	$	58,203	$	63,391	$	59,524	$	54,383
Interest on securities		8,016		7,212		7,040		6,665		6,102
Other interest and dividend<br><br><br>income		992		500		598		571		625
Total interest and dividend<br><br><br>income		63,166		65,915		71,029		66,760		61,110
INTEREST EXPENSE
Deposits		7,804		9,325		9,618		9,306		8,076
Short-term borrowings		1,897		1,989		2,835		2,265		2,166
Junior subordinated debentures issued to<br><br><br>capital trusts		640		687		738		741		783
Total interest expense		10,341		12,001		13,191		12,312		11,025
Net interest income	$	52,825	$	53,914	$	57,838	$	54,448	$	50,085

Byline Bancorp, Inc.

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The following table presents the average interest-earning assets and average interest-bearing liabilities for the periods indicated:

	For the Three Months Ended
	March 31, 2020								December 31, 2019
(dollars in thousands)	Average<br><br><br>Balance^(5)^			Interest<br><br><br>Inc / Exp		Average<br><br><br>Yield /<br><br><br>Rate			Average<br><br><br>Balance^(5)^			Interest<br><br><br>Inc / Exp		Average<br><br><br>Yield /<br><br><br>Rate
ASSETS
Cash and cash equivalents	$	38,934		$	157		1.63	%	$	38,624		$	220		2.25	%
Loans and leases^(1)^		3,799,213			54,158		5.73	%		3,807,731			58,203		6.06	%
Taxable securities		1,175,120			8,316		2.85	%		1,025,975			6,963		2.69	%
Tax-exempt securities^(2)^		84,679			535		2.54	%		84,640			529		2.48	%
Total interest-earning assets	$	5,097,946		$	63,166		4.98	%	$	4,956,970		$	65,915		5.28	%
Allowance for loan and lease losses		(33,664	)							(32,688	)
All other assets		501,670								502,764
TOTAL ASSETS	$	5,565,952							$	5,427,046
LIABILITIES AND STOCKHOLDERS’<br><br><br>EQUITY
Deposits
Interest checking	$	338,905		$	260		0.31	%	$	399,065		$	612		0.61	%
Money market accounts		962,205			2,214		0.93	%		790,565			1,945		0.98	%
Savings		480,270			61		0.05	%		474,394			63		0.05	%
Time deposits		1,113,596			5,269		1.90	%		1,231,641			6,705		2.16	%
Total interest-bearing<br><br><br>deposits		2,894,976			7,804		1.08	%		2,895,665			9,325		1.28	%
Short-term borrowings		521,108			1,897		1.46	%		414,515			1,989		1.90	%
Junior subordinated debentures<br><br><br>issued to capital trusts		37,385			640		6.88	%		37,254			687		7.32	%
Total borrowings		558,493			2,537		1.83	%		451,769			2,676		2.35	%
Total interest-bearing liabilities	$	3,453,469		$	10,341		1.20	%	$	3,347,434		$	12,001		1.42	%
Non-interest-bearing demand deposits		1,298,800								1,288,960
Other liabilities		48,256								44,907
Total stockholders’ equity		765,427								745,745
TOTAL LIABILITIES AND<br><br><br>STOCKHOLDERS’ EQUITY	$	5,565,952							$	5,427,046
Net interest spread^(3)^							3.78	%							3.86	%
Net interest income				$	52,825							$	53,914
Net interest margin^(4)^							4.17	%							4.32	%
Net loan accretion impact on margin				$	3,671		0.29	%				$	5,418		0.43	%
(1)	Loan and lease balances are net of deferred origination fees and costs and initial indirect costs. Non-accrual loans and leases are included in total loan and lease balances.
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(2)	Interest income and rates exclude the effects of a tax equivalent adjustment to adjust tax exempt investment income on tax exempt investment securities to a fully taxable basis due to immateriality.
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(3)	Represents the average rate earned on interest-earning assets minus the average rate paid on interest-bearing liabilities.
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(4)	Represents net interest income (annualized) divided by total average earning assets.
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(5)	Average balances are average daily balances.
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Byline Bancorp, Inc.

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Net interest income for the first quarter of 2020 was $52.8 million, a decrease of $1.1 million, or 2.0%, from $53.9 million for the fourth quarter of 2019.

The decrease in net interest income was primarily due to:

•	A decrease of $4.0 million in interest and fees on loans and leases, mainly due to a $1.7 million decrease in accretion income on acquired loans.

Partially offset by:

•	A decrease of $1.5 million in interest expense on deposits, as a result of lower average time deposit balances and cost attributable to maturities of higher-rate time deposits; and
•	An increase of $1.3 million in interest income on securities principally as a result of purchases of mortgage-backed securities during the quarter.
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Net interest margin for the first quarter of 2020 was 4.17%, a decrease of 15 basis points compared to 4.32% for the fourth quarter of 2019. Total net accretion income on acquired loans contributed 29 basis points to the net interest margin for the first quarter of 2020 compared to 43 basis points for the fourth quarter of 2019, a decrease of 14 basis points. The net interest margin decrease during the first quarter of 2020 was primarily driven by decreased loan and lease yields largely resulting from decreased loan accretion income partly offset by a decrease in the cost of funds as a result of decreases in short-term rates.

The average cost of total deposits was 0.75% for the first quarter of 2020, a decrease of 13 basis points compared to the fourth quarter of 2019, mainly due to a lower average cost of time deposits and interest-bearing checking accounts as well as a favorable change in deposit mix. Average money market accounts grew by $171.6 million while average time deposits decreased by $118.0 million.

Provision for Loan and Lease Losses

The provision for loan and lease losses was $14.5 million for the first quarter of 2020, an increase of $10.1 million compared to $4.4 million for the fourth quarter of 2019. The first quarter included allocations of $10.3 million for originated loans and leases, $2.7 million for acquired non-impaired loans, and $1.5 million for acquired impaired loans. The provision during the first quarter of 2020 for originated loans reflects increased impairments on commercial and industrial and commercial real estate loans, growth in the commercial and industrial portfolio during the quarter, and allocations of $6.3 million made to address the impact of the COVID-19 pandemic.

Byline Bancorp, Inc.

Page 6 of 21

Non-interest Income

The following table presents the components of non-interest income for the periods indicated:

	Three Months Ended
	March 31,			December 31,			September 30,			June 30,			March 31,
(dollars in thousands)	2020			2019			2019			2019			2019
NON-INTEREST INCOME
Fees and service charges on deposits	$	1,673		$	1,635		$	1,612		$	1,441		$	1,770
Loan servicing revenue		2,758			2,834			2,692			2,630			2,539
Loan servicing asset revaluation		(3,064	)		(2,545	)		(1,610	)		(1,223	)		(1,261	)
ATM and interchange fees		1,216			1,150			973			945			717
Net gains on sales of securities<br><br><br>available-for-sale		1,375			—			178			973			—
Change in fair value of equity<br><br><br>securities, net		(619	)		381			(15	)		551			499
Net gains on sales of loans		4,773			8,735			9,405			7,472			6,233
Wealth management and trust income		669			704			653			626			595
Other non-interest income		392			1,622			918			768			896
Total non-interest income	$	9,173		$	14,516		$	14,806		$	14,183		$	11,988

Non-interest income for the first quarter of 2020 was $9.2 million, a decrease of $5.3 million, or 36.8%, compared to $14.5 million for the fourth quarter of 2019.

The decrease in total non-interest income was primarily due to:

A decrease of $4.0 million in net gains on sales of loans, mainly due to a decrease in volume of sales of government guaranteed loans;
•	A decrease of $1.2 million in other non-interest income, mostly due to a decline in the fair value of non-designated swaps; and
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•	A decrease in the change in fair value of equity securities, net, of $1.0 million due to a decrease in the fair value of those securities.
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Partially offset by:

•	An increase of $1.4 million in net gains on sales of securities available-for-sale as a result of sales during the quarter compared to no sales in the prior quarter.

During the first quarter of 2020, the Company sold $61.0 million of U.S. government guaranteed loans compared to $101.5 million during the fourth quarter of 2019. The decrease in sales is principally driven by a decrease in originations as well as a decrease in premiums as a result of the COVID-19 pandemic.

Byline Bancorp, Inc.

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Non-interest Expense

The following table presents the components of non-interest expense for the periods indicated:

	Three Months Ended
	March 31,		December 31,		September 30,		June 30,		March 31,
(dollars in thousands)	2020		2019		2019		2019		2019
NON-INTEREST EXPENSE
Salaries and employee benefits	$	24,666	$	24,228	$	24,537	$	23,652	$	22,892
Occupancy and equipment expense, net		5,524		5,241		4,512		5,069		4,949
Loan and lease related expenses		1,311		2,648		1,949		1,841		1,577
Legal, audit and other professional fees		2,334		2,340		4,066		2,981		2,066
Data processing		2,665		2,678		4,062		3,849		3,144
Net loss recognized on other<br><br><br>real estate owned and other<br><br><br>related expenses		519		122		95		252		196
Other intangible assets<br><br><br>amortization expense		1,893		2,002		2,003		1,959		1,773
Other non-interest expense		4,615		4,435		4,224		4,351		4,082
Total non-interest expense	$	43,527	$	43,694	$	45,448	$	43,954	$	40,679

Non-interest expense for the first quarter of 2020 was $43.5 million, a decrease of $167,000, or 0.4%, from $43.7 million for the fourth quarter of 2019.

The decrease in total non-interest expense was primarily due to:

•	A decrease of $1.3 million in loan and lease related expenses due to lower loan expenses on government guaranteed loans and lower loan collection expense.

Partially offset by:

•	An increase of $438,000 in salaries and employee benefits, mainly due to higher payroll taxes and increased employer costs related to benefits, partially offset by a decrease in commissions; and
•	An increase of $397,000 in net loss recognized on other real estate owned and other related expenses mostly due to a decrease in gains recognized on other real estate owned, partially offset by lower real estate tax expenses.
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The Company’s efficiency ratio was 67.16% for the first quarter of 2020, compared with 60.93% for the fourth quarter of 2019. Excluding merger-related expenses, core system conversion expenses, and impairment charges on assets held for sale, the Company’s adjusted efficiency ratio^1^ was 66.00% for the first quarter of 2020, compared with 60.51% for the fourth quarter of 2019. The increase in the efficiency ratio was primarily driven by the decline in non-interest income.

^1^	Represents a non-GAAP financial measure. See “Reconciliation of non-GAAP Financial Measures” for a reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measure.

Byline Bancorp, Inc.

Page 8 of 21

INCOME TAXES

The Company recorded income tax expense of $1.1 million during the first quarter of 2020, an effective tax rate of 26.1%, compared to $4.5 million during the fourth quarter of 2019, an effective tax rate of 22.1%. The effective tax rate during the fourth quarter of 2019 benefited from the recognition of tax assets associated with other real estate owned.

STATEMENTS OF FINANCIAL CONDITION

Total assets were $5.7 billion at March 31, 2020, an increase of $212.9 million compared to $5.5 billion at December 31, 2019, and an increase of $724.8 million compared to $5.0 billion at March 31, 2019. The increase from March 31, 2019 was mostly due to the assets acquired through the Oak Park River Forest acquisition.

The current quarter increase was primarily due to:

•	An increase in securities of $112.6 million, reflecting purchases of securities during the quarter; and
•	An increase in loans and leases of $74.6 million, mostly due to an increase of $149.0 million in our originated loan portfolio, partially offset by a decrease of $74.4 million in our acquired loan portfolios as a result of paydowns.
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The following table shows our allocation of the originated, acquired impaired, and acquired non-impaired loans and leases at the dates indicated:

	March 31, 2020						December 31, 2019						March 31, 2019
(dollars in thousands)	Amount			% of Total			Amount			% of Total			Amount			% of Total
Originated loans and leases
Commercial real estate	$	839,244			21.7	%	$	792,263			20.9	%	$	738,832			20.7	%
Residential real estate		480,946			12.5	%		483,072			12.8	%		494,877			13.9	%
Construction, land development, and<br><br><br>other land		242,001			6.3	%		235,794			6.2	%		181,427			5.1	%
Commercial and industrial		1,263,688			32.7	%		1,160,996			30.7	%		900,709			25.2	%
Installment and other		4,594			0.1	%		5,372			0.1	%		11,082			0.3	%
Leasing financing receivables		154,173			4.0	%		158,155			4.2	%		160,607			4.5	%
Total originated loans and leases	$	2,984,646			77.3	%	$	2,835,652			74.9	%	$	2,487,534			69.7	%
Acquired impaired loans
Commercial real estate	$	127,895			3.3	%	$	135,914			3.6	%	$	141,199			4.0	%
Residential real estate		94,198			2.5	%		100,223			2.7	%		106,764			3.0	%
Construction, land development, and<br><br><br>other land		5,291			0.1	%		5,373			0.1	%		3,111			0.1	%
Commercial and industrial		15,808			0.4	%		16,909			0.4	%		11,963			0.3	%
Installment and other		236			0.0	%		249			0.0	%		374			0.0	%
Total acquired impaired loans	$	243,428			6.3	%	$	258,668			6.8	%	$	263,411			7.4	%
Acquired non-impaired loans and leases
Commercial real estate	$	327,820			8.5	%	$	348,365			9.2	%	$	382,252			10.7	%
Residential real estate		118,853			3.1	%		128,527			3.4	%		97,395			2.8	%
Construction, land development, and<br><br><br>other land		30,484			0.8	%		37,490			1.0	%		29,121			0.8	%
Commercial and industrial		135,063			3.5	%		153,660			4.1	%		277,146			7.8	%
Installment and other		891			0.0	%		944			0.0	%		1,346			0.0	%
Leasing financing receivables		19,074			0.5	%		22,355			0.6	%		29,361			0.8	%
Total acquired non-impaired loans<br><br><br>and leases	$	632,185			16.4	%	$	691,341			18.3	%	$	816,621			22.9	%
Total loans and leases	$	3,860,259			100.0	%	$	3,785,661			100.0	%	$	3,567,566			100.0	%
Allowance for loan and lease losses		(41,840	)					(31,936	)					(27,106	)
Total loans and leases, net of allowance for<br><br><br>loan and lease losses	$	3,818,419					$	3,753,725					$	3,540,460

Byline Bancorp, Inc.

Page 9 of 21

ASSET QUALITY

Non-Performing Assets

The following table sets forth the amounts of non-performing loans and leases (excluding acquired impaired), non-performing assets, and other real estate owned at the dates indicated:

	March 31,			December 31,			September 30,			June 30,			March 31,
(dollars in thousands)	2020			2019			2019			2019			2019
Non-performing assets:
Non-accrual loans and leases	$	48,964		$	36,272		$	39,528		$	34,027		$	28,539
Past due loans and leases 90 days or more<br><br><br>and still accruing interest		—			—			—			996			—
Accruing troubled debt restructured loans		1,725			1,771			2,204			1,529			1,921
Total non-performing loans and leases		50,689			38,043			41,732			36,552			30,460
Other real estate owned		9,273			9,896			6,502			6,531			4,595
Total non-performing assets	$	59,962		$	47,939		$	48,234		$	43,083		$	35,055
Total non-performing loans and leases as a<br><br><br>percentage of total loans and leases		1.31	%		1.00	%		1.09	%		0.95	%		0.85	%
Total non-performing assets as a percentage<br><br><br>of total assets		1.05	%		0.87	%		0.89	%		0.80	%		0.70	%
Allowance for loan and lease losses as a<br><br><br>percentage of non-performing loans and<br><br><br>leases		82.54	%		83.95	%		75.68	%		85.17	%		88.99	%
Non-performing assets guaranteed by<br><br><br>U.S. government:
Non-accrual loans guaranteed	$	4,957		$	4,232		$	4,167		$	4,723		$	5,070
Past due loans 90 days or more and still<br><br><br>accruing interest guaranteed		—			—			—			—			—
Accruing troubled debt restructured loans<br><br><br>guaranteed		—			—			—			—			—
Total non-performing loans guaranteed	$	4,957		$	4,232		$	4,167		$	4,723		$	5,070
Total non-performing loans and leases<br><br><br>not guaranteed as a percentage of total<br><br><br>loans and leases		1.18	%		0.89	%		0.98	%		0.82	%		0.71	%
Total non-performing assets not guaranteed<br><br><br>as a percentage of total assets		0.96	%		0.79	%		0.81	%		0.71	%		0.60	%

Variances in non-performing assets were:

•	Non-performing loans and leases were $50.7 million at March 31, 2020, an increase of $12.7 million from $38.0 million at December 31, 2019, principally due to increases, as follows:
•	$5.1 million in commercial and industrial loans,
---	---
•	$3.8 million in commercial real estate loans, and
---	---
•	$2.6 million in construction, land development and other land loans; and
---	---
•	Other real estate owned was $9.3 million at March 31, 2020, a decrease of $623,000 from $9.9 million at December 31, 2019 due to sales and valuation adjustments.
---	---

U.S. government guaranteed balances of non-performing loans were $5.0 million at March 31, 2020 and $4.2 million at December 31, 2019.

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Allowance for Loan and Lease Losses

The following table presents the balance and activity within the allowance for loan and lease losses for the periods indicated:

	Three Months Ended
	March 31,			December 31,			September 30,			June 30,			March 31,
(dollars in thousands)	2020			2019			2019			2019			2019
Allowance for loan and lease losses,<br><br><br>beginning of period	$	31,936		$	31,585		$	31,132		$	27,106		$	25,201
Provision for loan and lease losses		14,455			4,387			5,931			6,391			3,999
Net charge-offs of loans and leases		(4,551	)		(4,036	)		(5,478	)		(2,365	)		(2,094	)
Allowance for loan and lease losses,<br><br><br>end of period	$	41,840		$	31,936		$	31,585		$	31,132		$	27,106
Allowance for loan and lease losses<br><br><br>to period end total loans and<br><br><br>leases held for investment		1.08	%		0.84	%		0.82	%		0.81	%		0.76	%
Net charge-offs (annualized) to<br><br><br>average loans and leases<br><br><br>outstanding during the period		0.48	%		0.42	%		0.56	%		0.25	%		0.24	%
Provision for loan and lease losses to<br><br><br>net charge-offs during the period	3.18x			1.09x			1.08x			2.70x			1.91x

The allowance for loan and lease losses as a percentage of total loans and leases held for investment increased to 1.08% at March 31, 2020 compared to 0.84% at December 31, 2019 and 0.76% at March 31, 2019.

In June 2016, the Financial Accounting Standards Board (“FASB”) issued new guidance on the recognition of credit losses which replaces the incurred loss impairment methodology with a methodology that reflects expected credit losses. In November 2019, the FASB delayed the effective date of the standard for smaller reporting companies, which includes emerging growth companies. Assuming the Company remains an emerging growth company, the standard is effective for fiscal years beginning after December 15, 2022. The Company is in process of implementation and determining the impact that this new authoritative guidance will have on the Company’s consolidated financial statements.

Net Charge-Offs

Net charge-offs during the first quarter of 2020 were $4.6 million, or 0.48% of average loans and leases, on an annualized basis, an increase of $515,000 compared to $4.0 million, or 0.42% of average loans and leases, during the fourth quarter of 2019, and an increase of $2.5 million from $2.1 million, or 0.24%, for the comparable quarter one year ago.

The net charge-offs during the quarter were primarily attributed to the unguaranteed portion of U.S. government guaranteed loans. Net charge-offs for the first quarter of 2020 included $3.4 million in the unguaranteed portion of U.S. government guaranteed loans, while net charge-offs for the fourth quarter of 2019 included $3.6 million and first quarter of 2019 included $1.7 million in the unguaranteed portion of U.S. government guaranteed loans.

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Deposits and Other Liabilities

The following table presents the composition of deposits at the dates indicated:

		December 31,		September 30,		June 30,		March 31,
(dollars in thousands)		2019		2019		2019		2019
Non-interest-bearing demand deposits	1,290,896	$	1,279,641	$	1,221,431	$	1,240,375	$	1,163,255
Interest-bearing checking accounts	355,678		338,185		372,049		345,081		305,393
Money market demand accounts	1,104,276		881,387		745,154		728,954		611,634
Other savings	486,131		475,839		471,878		480,756		468,524
Time deposits (below 250,000)	800,759		916,723		966,866		980,162		967,999
Time deposits (250,000 and above)	201,096		255,802		302,936		284,915		291,711
Total deposits	4,238,836	$	4,147,577	$	4,080,314	$	4,060,243	$	3,808,516

All values are in US Dollars.

Total deposits were $4.2 billion at March 31, 2020, an increase of $91.3 million compared to December 31, 2019, an increase of 2.2%. Non-interest-bearing deposits were 30.5% of total deposits at March 31, 2020 compared to 30.9% at December 31, 2019.

The increase in the current quarter was primarily due to:

•	An increase in money market demand deposits of $222.9 million, from $881.4 million at December 31, 2019 to $1.1 billion at March 31, 2020, largely driven by growth in business and brokered account balances.

Partially offset by:

•	A decrease in time deposits of $170.7 million, from $1.2 billion at December 31, 2019 to $1.0 billion at March 31, 2020, principally driven by decreases in personal and brokered certificates.

Total borrowings and other liabilities were $733.3 million at March 31, 2020, an increase of $109.1 million from $624.1 million at December 31, 2019, driven by an increase in short-term borrowings of $101.0 million as a result of the Company testing liquidity resources.

Stockholders’ Equity

Total stockholders’ equity was $762.7 million at March 31, 2020, an increase of $12.6 million from $750.1 million at December 31, 2019. The increase was due to the increase in accumulated other comprehensive income reflecting the unrealized gains in our available-for-sale securities portfolio in addition to net income generated during the quarter less dividends declared.

Stockholders’ equity increased $93.9 million from $668.7 million at March 31, 2019. The increase was mainly due to the stock consideration issued in connection with the Oak Park River Forest acquisition as well as net income generated during the period.

The Company repurchased 118,486 shares of its common stock at an average price of $14.08 per share during the first quarter of 2020 under its board approved stock repurchase program announced in the fourth quarter of 2019. The Company is authorized to purchase up to an aggregate of 1,250,000 shares of the Company’s outstanding common stock. The program will be in effect until December 31, 2020, unless terminated earlier. The program was paused in March 2020.

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The following table presents the actual regulatory capital dollar amounts and ratios of the Company and Byline Bank as of March 31, 2020:

	Actual					Minimum Capital<br><br><br>Required					Required to be<br><br><br>Considered<br><br><br>Well Capitalized
March 31, 2020	Amount		Ratio			Amount		Ratio			Amount		Ratio
Total capital to risk weighted assets:
Company	$	641,540		14.50	%	$	353,933		8.00	%	N/A		N/A
Bank		615,278		13.93	%		353,391		8.00	%	$	441,739		10.00	%
Tier 1 capital to risk weighted assets:
Company	$	598,342		13.52	%	$	265,450		6.00	%	N/A		N/A
Bank		572,080		12.95	%		265,043		6.00	%	$	353,391		8.00	%
Common Equity Tier 1 (CET1) to<br><br><br>risk weighted assets:
Company	$	541,404		12.24	%	$	199,087		4.50	%	N/A		N/A
Bank		572,080		12.95	%		198,782		4.50	%	$	287,130		6.50	%
Tier 1 capital to average assets:
Company	$	598,342		11.18	%	$	214,094		4.00	%	N/A		N/A
Bank		572,080		10.70	%		213,950		4.00	%	$	267,437		5.00	%

Capital ratios for the period presented are based on the Basel III regulatory capital framework as applied to the Company’s current business and operations, and are subject to, among other things, completion and filing of the Company’s regulatory reports and ongoing regulatory review and implementation guidance.

Conference Call, Webcast and Slide Presentation

The Company will host a conference call and webcast at 9:00 a.m. Central Time (10:00 a.m. Eastern Time) on Friday, May 1, 2020 to discuss its quarterly financial results. Analysts and investors may participate in the question-and-answer session. The call can be accessed via telephone at (877) 512-8755. A recorded replay can be accessed through May 15, 2020 by dialing (877) 344-7529; passcode: 10142538.

A slide presentation relating to the first quarter 2020 results will be accessible prior to the scheduled conference call. The slide presentation and webcast of the conference call can be accessed on the News and Events page of the Company’s investor relations website at www.bylinebancorp.com.

About Byline Bancorp, Inc.

Headquartered in Chicago, Byline Bancorp, Inc. is the parent company for Byline Bank, a full service commercial bank serving small- and medium-sized businesses, financial sponsors, and consumers. Byline Bank has approximately $5.7 billion in assets and operates more than 50 full service branch locations throughout the Chicago and Milwaukee metropolitan areas. Byline Bank offers a broad range of commercial and retail banking products and services including small ticket equipment leasing solutions and is one of the top five Small Business Administration lenders in the United States.

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Non-GAAP Financial Measures

This release contains certain financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America (“GAAP”). These measures include adjusted net income, adjusted diluted earnings per share, adjusted efficiency ratio, adjusted non-interest expense to average assets, non-interest income to total revenues, adjusted return on average stockholders’ equity, adjusted return on average assets, pre-tax pre-provision return on average assets, adjusted pre-tax pre-provision return on average assets, tangible book value per common share, tangible common equity to tangible assets, return on average tangible common stockholders' equity, and adjusted return on average tangible common stockholders' equity. Management believes that these non-GAAP financial measures provide useful information to management and investors that is supplementary to the Company’s financial condition, results of operations and cash flows computed in accordance with GAAP; however, management acknowledges that our non-GAAP financial measures have a number of limitations. As such, these disclosures should not be viewed as a substitute for results determined in accordance with GAAP financial measures that we and other companies use. Management also uses these measures for peer comparison. See “Reconciliation of Non-GAAP Financial Measures” in the financial schedules included in this press release for a reconciliation of the non-GAAP financial measures to the comparable GAAP financial measures. Additionally, please refer to the Company’s Annual Report on Form 10-K for the detailed definitions of these non-GAAP financial measures.

Forward-Looking Statements

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Page 14 of 21

Contacts:

Investors:	Media:
Tony Rossi	Erin O’Neill
Financial Profiles, Inc.<br><br><br>310-622-8221	Director of Marketing<br><br><br>Byline Bank
[email protected]	773-475-2901
	[email protected]

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Page 15 of 21

BYLINE BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (unaudited)

	March 31,			December 31,			September 30,			June 30,			March 31,
(dollars in thousands)	2020			2019			2019			2019			2019
ASSETS
Cash and due from banks	$	45,233		$	48,228		$	75,275		$	57,513		$	50,026
Interest bearing deposits with other banks		74,386			32,509			33,564			31,802			31,971
Cash and cash equivalents		119,619			80,737			108,839			89,315			81,997
Equity and other securities, at fair value		7,413			8,031			7,648			7,662			7,216
Securities available-for-sale, at fair value		1,299,483			1,186,292			1,031,933			969,029			964,553
Securities held-to-maturity, at amortized cost		4,408			4,412			4,417			4,421			4,425
Restricted stock, at cost		24,197			22,127			24,331			22,937			19,202
Loans held for sale		13,299			11,732			7,176			18,473			510
Loans and leases:
Loans and leases		3,860,259			3,785,661			3,831,090			3,863,148			3,567,566
Allowance for loan and lease losses		(41,840	)		(31,936	)		(31,585	)		(31,132	)		(27,106	)
Net loans and leases		3,818,419			3,753,725			3,799,505			3,832,016			3,540,460
Servicing assets, at fair value		17,800			19,471			19,939			19,760			19,534
Premises and equipment, net		96,446			96,140			96,006			96,588			97,069
Other real estate owned, net		9,273			9,896			6,502			6,531			4,595
Goodwill and other intangible assets, net		178,362			180,255			179,543			181,546			159,823
Bank-owned life insurance		9,898			9,750			9,699			9,634			6,087
Deferred tax assets, net		33,845			38,315			33,388			35,737			30,534
Accrued interest receivable and other assets		102,292			100,926			109,352			97,587			73,920
Total assets	$	5,734,754		$	5,521,809		$	5,438,278		$	5,391,236		$	5,009,925
LIABILITIES AND STOCKHOLDERS’ EQUITY
LIABILITIES
Non-interest-bearing demand deposits	$	1,290,896		$	1,279,641		$	1,221,431		$	1,240,375		$	1,163,255
Interest-bearing deposits		2,947,940			2,867,936			2,858,883			2,819,868			2,645,261
Total deposits		4,238,836			4,147,577			4,080,314			4,060,243			3,808,516
Short-term borrowings		640,647			539,638			538,290			532,885			459,369
Junior subordinated debentures issued to<br><br><br>capital trusts, net		37,462			37,334			37,207			37,059			36,912
Accrued expenses and other liabilities		55,142			47,145			46,601			43,374			36,379
Total liabilities		4,972,087			4,771,694			4,702,412			4,673,561			4,341,176
STOCKHOLDERS’ EQUITY
Preferred stock		10,438			10,438			10,438			10,438			10,438
Common stock		380			379			378			378			362
Additional paid-in capital		582,517			580,965			579,564			578,828			548,005
Retained earnings		160,652			159,033			144,525			129,379			116,363
Accumulated other comprehensive income<br><br><br>(loss), net of tax		10,348			(700	)		961			(1,348	)		(6,419	)
Treasury stock		(1,668	)		—			—			—			—
Total stockholders’ equity		762,667			750,115			735,866			717,675			668,749
Total liabilities and stockholders’<br><br><br>equity	$	5,734,754		$	5,521,809		$	5,438,278		$	5,391,236		$	5,009,925

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BYLINE BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

	Three Months Ended
	March 31,			December 31,			September 30,			June 30,			March 31,
(dollars in thousands, except per share data)	2020			2019			2019			2019			2019
INTEREST AND DIVIDEND INCOME
Interest and fees on loans and leases	$	54,158		$	58,203		$	63,391		$	59,524		$	54,383
Interest on securities		8,016			7,212			7,040			6,665			6,102
Other interest and dividend income		992			500			598			571			625
Total interest and dividend income		63,166			65,915			71,029			66,760			61,110
INTEREST EXPENSE
Deposits		7,804			9,325			9,618			9,306			8,076
Short-term borrowings		1,897			1,989			2,835			2,265			2,166
Junior subordinated debentures issued to<br><br><br>capital trusts		640			687			738			741			783
Total interest expense		10,341			12,001			13,191			12,312			11,025
Net interest income		52,825			53,914			57,838			54,448			50,085
PROVISION FOR LOAN AND LEASE LOSSES		14,455			4,387			5,931			6,391			3,999
Net interest income after provision<br><br><br>for loan and lease losses		38,370			49,527			51,907			48,057			46,086
NON-INTEREST INCOME
Fees and service charges on deposits		1,673			1,635			1,612			1,441			1,770
Loan servicing revenue		2,758			2,834			2,692			2,630			2,539
Loan servicing asset revaluation		(3,064	)		(2,545	)		(1,610	)		(1,223	)		(1,261	)
ATM and interchange fees		1,216			1,150			973			945			717
Net gains on sales of securities<br><br><br>available-for-sale		1,375			—			178			973			—
Change in fair value of equity securities,<br><br><br>net		(619	)		381			(15	)		551			499
Net gains on sales of loans		4,773			8,735			9,405			7,472			6,233
Wealth management and trust income		669			704			653			626			595
Other non-interest income		392			1,622			918			768			896
Total non-interest income		9,173			14,516			14,806			14,183			11,988
NON-INTEREST EXPENSE
Salaries and employee benefits		24,666			24,228			24,537			23,652			22,892
Occupancy and equipment expense, net		5,524			5,241			4,512			5,069			4,949
Loan and lease related expenses		1,311			2,648			1,949			1,841			1,577
Legal, audit, and other professional fees		2,334			2,340			4,066			2,981			2,066
Data processing		2,665			2,678			4,062			3,849			3,144
Net loss recognized on other real<br><br><br>estate owned and other related<br><br><br>expenses		519			122			95			252			196
Other intangible assets amortization<br><br><br>expense		1,893			2,002			2,003			1,959			1,773
Other non-interest expense		4,615			4,435			4,224			4,351			4,082
Total non-interest expense		43,527			43,694			45,448			43,954			40,679
INCOME BEFORE PROVISION FOR INCOME<br><br><br>TAXES		4,016			20,349			21,265			18,286			17,395
PROVISION FOR INCOME TAXES		1,050			4,497			5,923			5,075			4,798
NET INCOME		2,966			15,852			15,342			13,211			12,597
Dividends on preferred shares		196			196			196			195			196
INCOME AVAILABLE TO COMMON<br><br><br>STOCKHOLDERS	$	2,770		$	15,656		$	15,146		$	13,016		$	12,401
EARNINGS PER COMMON SHARE
Basic	$	0.07		$	0.41		$	0.40		$	0.35		$	0.34
Diluted	$	0.07		$	0.41		$	0.39		$	0.34		$	0.34

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BYLINE BANCORP, INC. AND SUBSIDIARIES

SELECTED FINANCIAL DATA (unaudited)

	As of or For the Three Months Ended
(dollars in thousands, except share and	March 31,			December 31,			September 30,			June 30,			March 31,
per share data)	2020			2019			2019			2019			2019
Common Share Data
Basic earnings per common share	$	0.07		$	0.41		$	0.40		$	0.35		$	0.34
Diluted earnings per common share	$	0.07		$	0.41		$	0.39		$	0.34		$	0.34
Adjusted diluted earnings per common<br><br><br>share^(2)(3)(4)^	$	0.09		$	0.42		$	0.41		$	0.41		$	0.38
Weighted average common shares<br><br><br>outstanding (basic)		37,943,333			37,872,835			37,831,356			37,263,352			36,169,477
Weighted average common shares<br><br><br>outstanding (diluted)		38,663,658			38,537,899			38,487,180			37,948,006			36,876,574
Common shares outstanding		38,383,021			38,256,500			38,169,126			38,115,219			36,398,144
Cash dividends per common share	$	0.03		$	0.03		N/A			N/A			N/A
Dividend payout ratio on common stock		42.86	%		7.32	%	N/A			N/A			N/A
Tangible book value per common share^(1)^	$	14.95		$	14.62		$	14.30		$	13.79		$	13.70
Key Ratios and Performance Metrics<br><br><br>(annualized where applicable)
Net interest margin		4.17	%		4.32	%		4.62	%		4.51	%		4.43	%
Average cost of deposits		0.75	%		0.88	%		0.94	%		0.92	%		0.87	%
Efficiency ratio^(2)^		67.16	%		60.93	%		59.81	%		61.19	%		62.68	%
Adjusted efficiency ratio^(1)(2)(3)^		66.00	%		60.51	%		58.17	%		56.02	%		59.55	%
Non-interest expense to average assets		3.15	%		3.19	%		3.32	%		3.34	%		3.32	%
Adjusted non-interest expense to<br><br><br>average assets^(1)(3)^		3.09	%		3.17	%		3.23	%		3.07	%		3.17	%
Return on average stockholders' equity		1.56	%		8.43	%		8.34	%		7.60	%		7.75	%
Adjusted return on average<br><br><br>stockholders' equity^(1)(3)^		1.83	%		8.54	%		8.78	%		9.16	%		8.61	%
Return on average assets		0.21	%		1.16	%		1.12	%		1.00	%		1.03	%
Adjusted return on average<br><br><br>assets^(1)(3)(4)^		0.25	%		1.17	%		1.18	%		1.21	%		1.14	%
Non-interest income to total<br><br><br>revenues^(1)^		14.79	%		21.21	%		20.38	%		20.67	%		19.31	%
Pre-tax pre-provision return on<br><br><br>average assets^(1)^		1.33	%		1.81	%		1.98	%		1.88	%		1.75	%
Adjusted pre-tax pre-provision return on<br><br><br>average assets^(1)(3)^		1.39	%		1.83	%		2.07	%		2.15	%		1.91	%
Return on average tangible common<br><br><br>stockholders' equity^(1)^		2.89	%		12.20	%		12.22	%		11.32	%		11.37	%
Adjusted return on average tangible<br><br><br>common stockholders' equity^(1)(3)^		3.25	%		12.35	%		12.82	%		13.44	%		12.54	%
Non-interest-bearing deposits to total<br><br><br>deposits		30.45	%		30.85	%		29.93	%		30.55	%		30.54	%
Loans and leases held for sale and loans<br><br><br>and lease held for investment to total<br><br><br>deposits		91.38	%		91.56	%		94.07	%		95.60	%		93.69	%
Deposits to total liabilities		85.25	%		86.92	%		86.77	%		86.88	%		87.73	%
Deposits per branch	$	74,366		$	67,993		$	66,890		$	66,561		$	65,664
Asset Quality Ratios
Non-performing loans and leases to total<br><br><br>loans and leases held for investment, net<br><br><br>before ALLL		1.31	%		1.00	%		1.09	%		0.95	%		0.85	%
ALLL to total loans and leases held for<br><br><br>investment, net before ALLL		1.08	%		0.84	%		0.82	%		0.81	%		0.76	%
Net charge-offs to average total loans and<br><br><br>leases held for investment, net before<br><br><br>ALLL		0.48	%		0.42	%		0.56	%		0.25	%		0.24	%
Acquisition accounting adjustments^(4^^)^	$	25,889		$	28,511		$	31,053		$	37,109		$	29,341
Capital Ratios
Common equity to total assets		13.12	%		13.40	%		13.34	%		13.12	%		13.14	%
Tangible common equity to tangible<br><br><br>assets^(1)^		10.33	%		10.47	%		10.38	%		10.09	%		10.28	%
Leverage ratio		11.18	%		11.39	%		11.14	%		11.09	%		11.27	%
Common equity tier 1 capital ratio		12.24	%		12.36	%		12.12	%		11.65	%		12.14	%
Tier 1 capital ratio		13.52	%		13.67	%		13.43	%		12.96	%		13.57	%
Total capital ratio		14.50	%		14.43	%		14.19	%		13.71	%		14.28	%
(1)	Represents a non-GAAP financial measure. See “Reconciliation of non-GAAP Financial Measures” for a reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measure.
---	---
(2)	Represents non-interest expense less amortization of intangible assets divided by net interest income and non-interest income.
---	---
(3)	Calculation excludes impairment charges, merger-related expenses, and core systems conversion expense.
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(4)	Represents the remaining net unaccreted discount as a result of applying the fair value adjustment at the time of the business combination on acquired loans.
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BYLINE BANCORP, INC. AND SUBSIDIARIES

QUARTER-TO-DATE STATEMENT OF AVERAGE INTEREST-EARNING ASSETS AND AVERAGE INTEREST-BEARING LIABILITIES (unaudited)

	For the Three Months Ended March 31,
	2020								2019
(dollars in thousands)	Average<br><br><br>Balance^(5)^			Interest<br><br><br>Inc / Exp		Average<br><br><br>Yield /<br><br><br>Rate			Average<br><br><br>Balance^(5)^			Interest<br><br><br>Inc / Exp		Average<br><br><br>Yield /<br><br><br>Rate
ASSETS
Cash and cash equivalents	$	38,934		$	157		1.63	%	$	66,765		$	301		1.83	%
Loans and leases^(1)^		3,799,213			54,158		5.73	%		3,533,973			54,383		6.24	%
Taxable securities		1,175,120			8,316		2.85	%		926,129			6,083		2.66	%
Tax-exempt securities^(2)^		84,679			535		2.54	%		55,198			343		2.52	%
Total interest-earning assets	$	5,097,946		$	63,166		4.98	%	$	4,582,065		$	61,110		5.41	%
Allowance for loan and lease losses		(33,664	)							(25,354	)
All other assets		501,670								406,995
TOTAL ASSETS	$	5,565,952							$	4,963,706
LIABILITIES AND STOCKHOLDERS’<br><br><br>EQUITY
Deposits
Interest checking	$	338,905		$	260		0.31	%	$	293,049		$	413		0.57	%
Money market accounts		962,205			2,214		0.93	%		613,001			1,460		0.97	%
Savings		480,270			61		0.05	%		471,206			138		0.12	%
Time deposits		1,113,596			5,269		1.90	%		1,195,417			6,065		2.06	%
Total interest-bearing<br><br><br>deposits		2,894,976			7,804		1.08	%		2,572,673			8,076		1.27	%
Short-term borrowings		521,108			1,897		1.46	%		467,835			2,166		1.88	%
Junior subordinated debentures<br><br><br>issued to capital trusts		37,385			640		6.88	%		36,817			783		8.62	%
Total borrowings		558,493			2,537		1.83	%		504,652			2,949		2.37	%
Total interest-bearing liabilities	$	3,453,469		$	10,341		1.20	%	$	3,077,325		$	11,025		1.45	%
Non-interest-bearing demand deposits		1,298,800								1,185,981
Other liabilities		48,256								41,244
Total stockholders’ equity		765,427								659,156
TOTAL LIABILITIES AND<br><br><br>STOCKHOLDERS’ EQUITY	$	5,565,952							$	4,963,706
Net interest spread^(3)^							3.78	%							3.96	%
Net interest income				$	52,825							$	50,085
Net interest margin^(4)^							4.17	%							4.43	%
Net loan accretion impact on margin				$	3,671		0.29	%				$	5,201		0.46	%
(1)	Loan and lease balances are net of deferred origination fees and costs and initial indirect costs. Non-accrual loans and leases are included in total loan and lease balances.
---	---
(2)	Interest income and rates exclude the effects of a tax equivalent adjustment to adjust tax exempt investment income on tax exempt investment securities to a fully taxable basis due to immateriality.
---	---
(3)	Represents the average rate earned on interest-earning assets minus the average rate paid on interest-bearing liabilities.
---	---
(4)	Represents net interest income (annualized) divided by total average earning assets.
---	---
(5)	Average balances are average daily balances.
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BYLINE BANCORP, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (unaudited)

	As of or For the Three Months Ended
(dollars in thousands, except per share data)	March 31,<br><br><br>2020			December 31,<br><br><br>2019			September 30,<br><br><br>2019			June 30,<br><br><br>2019			March 31,<br><br><br>2019
Net income and earnings per share<br><br><br>excluding significant items
Reported Net Income	$	2,966		$	15,852		$	15,342		$	13,211		$	12,597
Significant items:
Impairment charges on assets held for sale		715			111			67			—			392
Merger-related expense		—			127			1,043			3,152			18
Core system conversion expense		—			48			77			394			1,530
Tax benefit on impairment charges and<br><br><br>merger-related expenses		(199	)		(79	)		(369	)		(842	)		(540	)
Adjusted Net Income	$	3,482		$	16,059		$	16,160		$	15,915		$	13,997
Reported Diluted Earnings per Share	$	0.07		$	0.41		$	0.39		$	0.34		$	0.34
Significant items:
Impairment charges on assets held for sale		0.02			—			—			—			0.01
Merger-related expense		—			0.01			0.03			0.08			—
Core system conversion expense		—			—			—			0.01			0.04
Tax benefit on impairment charges and<br><br><br>merger-related expenses		—			—			(0.01	)		(0.02	)		(0.01	)
Adjusted Diluted Earnings per Share	$	0.09		$	0.42		$	0.41		$	0.41		$	0.38

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BYLINE BANCORP, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (continued) (unaudited)

	As of or For the Three Months Ended
(dollars in thousands, except per share data,<br><br><br>ratios annualized, where applicable)	March 31,<br><br><br>2020			December 31,<br><br><br>2019			September 30,<br><br><br>2019			June 30,<br><br><br>2019			March 31,<br><br><br>2019
Adjusted non-interest expense:
Non-interest expense	$	43,527		$	43,694		$	45,448		$	43,954		$	40,679
Less: Significant items
Impairment charges on assets held for sale		715			111			67			—			392
Merger-related expense		—			127			1,043			3,152			18
Core system conversion expense		—			48			77			394			1,530
Adjusted non-interest expense	$	42,812		$	43,408		$	44,261		$	40,408		$	38,739
Adjusted non-interest expense excluding<br><br><br>amortization of intangible assets:
Adjusted non-interest expense	$	42,812		$	43,408		$	44,261		$	40,408		$	38,739
Less: Amortization of intangible assets		1,893			2,002			2,003			1,959			1,773
Adjusted non-interest expense excluding<br><br><br>amortization of intangible assets	$	40,919		$	41,406		$	42,258		$	38,449		$	36,966
Pre-tax pre-provision net income:
Pre-tax income	$	4,016		$	20,349		$	21,265		$	18,286		$	17,395
Add: Provision for loan and lease losses		14,455			4,387			5,931			6,391			3,999
Pre-tax pre-provision net income	$	18,471		$	24,736		$	27,196		$	24,677		$	21,394
Adjusted pre-tax pre-provision net income:
Pre-tax pre-provision net income	$	18,471		$	24,736		$	27,196		$	24,677		$	21,394
Impairment charges on assets held for sale		715			111			67			—			392
Merger-related expense		—			127			1,043			3,152			18
Core system conversion expense		—			48			77			394			1,530
Adjusted pre-tax pre-provision net income	$	19,186		$	25,022		$	28,383		$	28,223		$	23,334
Total revenues:
Net interest income	$	52,825		$	53,914		$	57,838		$	54,448		$	50,085
Add: Non-interest income		9,173			14,516			14,806			14,183			11,988
Total revenues	$	61,998		$	68,430		$	72,644		$	68,631		$	62,073
Tangible common stockholders' equity:
Total stockholders' equity	$	762,667		$	750,115		$	735,866		$	717,675		$	668,749
Less: Preferred stock		10,438			10,438			10,438			10,438			10,438
Less: Goodwill and other intangibles		178,362			180,255			179,543			181,546			159,823
Tangible common stockholders' equity	$	573,867		$	559,422		$	545,885		$	525,691		$	498,488
Tangible assets:
Total assets	$	5,734,754		$	5,521,809		$	5,438,278		$	5,391,236		$	5,009,925
Less: Goodwill and other intangibles		178,362			180,255			179,543			181,546			159,823
Tangible assets	$	5,556,392		$	5,341,554		$	5,258,735		$	5,209,690		$	4,850,102
Average tangible common stockholders' equity:
Average total stockholders' equity	$	765,427		$	745,745		$	729,781		$	696,928		$	659,156
Less: Average preferred stock		10,438			10,438			10,438			10,438			10,438
Less: Average goodwill and other<br><br><br>intangibles		179,416			179,192			180,740			175,236			160,924
Average tangible common stockholders' equity	$	575,573		$	556,115		$	538,603		$	511,254		$	487,794
Average tangible assets:
Average total assets	$	5,565,952		$	5,427,046		$	5,435,762		$	5,274,820		$	4,963,706
Less: Average goodwill and other<br><br><br>intangibles		179,416			179,192			180,740			175,236			160,924
Average tangible assets	$	5,386,536		$	5,247,854		$	5,255,022		$	5,099,584		$	4,802,782
Tangible net income available to common<br><br><br>stockholders:
Net income available to common stockholders	$	2,770		$	15,656		$	15,146		$	13,016		$	12,401
Add: After-tax intangible asset amortization		1,366			1,445			1,445			1,413			1,279
Tangible net income available to common<br><br><br>stockholders	$	4,136		$	17,101		$	16,591		$	14,429		$	13,680
Adjusted tangible net income available to common<br><br><br>stockholders:
Tangible net income available to common<br><br><br>stockholders	$	4,136		$	17,101		$	16,591		$	14,429		$	13,680
Impairment charges on assets held for sale		715			111			67			—			392
Merger-related expense		—			127			1,043			3,152			18
Core system conversion expense		—			48			77			394			1,530
Tax benefit on significant items		(199	)		(79	)		(369	)		(842	)		(540	)
Adjusted tangible net income available to<br><br><br>common stockholders	$	4,652		$	17,308		$	17,409		$	17,133		$	15,080

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Page 21 of 21

BYLINE BANCORP, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (continued) (unaudited)

	As of or For the Three Months Ended
(dollars in thousands, except share and per share<br><br><br>data, ratios annualized, where applicable)	March 31,<br><br><br>2020			December 31,<br><br><br>2019			September 30,<br><br><br>2019			June 30,<br><br><br>2019			March 31,<br><br><br>2019
Pre-tax pre-provision return on average assets:
Pre-tax pre-provision net income	$	18,471		$	24,736		$	27,196		$	24,677		$	21,394
Average total assets		5,565,952			5,427,046			5,435,762			5,274,820			4,963,706
Pre-tax pre-provision return on average assets		1.33	%		1.81	%		1.98	%		1.88	%		1.75	%
Adjusted pre-tax pre-provision return on average<br><br><br>assets:
Adjusted pre-tax pre-provision net income	$	19,186		$	25,022		$	28,383		$	28,223		$	23,334
Average total assets		5,565,952			5,427,046			5,435,762			5,274,820			4,963,706
Adjusted pre-tax pre-provision return on average<br><br><br>assets		1.39	%		1.83	%		2.07	%		2.15	%		1.91	%
Non-interest income to total revenues:
Non-interest income	$	9,173		$	14,516		$	14,806		$	14,183		$	11,988
Total revenues		61,998			68,430			72,644			68,631			62,073
Non-interest income to total revenues		14.79	%		21.21	%		20.38	%		20.67	%		19.31	%
Adjusted non-interest expense to average assets:
Adjusted non-interest expense	$	42,812		$	43,408		$	44,261		$	40,408		$	38,739
Average total assets		5,565,952			5,427,046			5,435,762			5,274,820			4,963,706
Adjusted non-interest expense to average assets		3.09	%		3.17	%		3.23	%		3.07	%		3.17	%
Adjusted efficiency ratio:
Adjusted non-interest expense excluding<br><br><br>amortization of intangible assets	$	40,919		$	41,406		$	42,258		$	38,449		$	36,966
Total revenues		61,998			68,430			72,644			68,631			62,073
Adjusted efficiency ratio		66.00	%		60.51	%		58.17	%		56.02	%		59.55	%
Adjusted return on average assets:
Adjusted net income	$	3,482		$	16,059		$	16,160		$	15,915		$	13,997
Average total assets		5,565,952			5,427,046			5,435,762			5,274,820			4,963,706
Adjusted return on average assets		0.25	%		1.17	%		1.18	%		1.21	%		1.14	%
Adjusted return on average stockholders' equity:
Adjusted net income	$	3,482		$	16,059		$	16,160		$	15,915		$	13,997
Average stockholders' equity		765,427			745,745			729,781			696,928			659,156
Adjusted return on average stockholders' equity		1.83	%		8.54	%		8.78	%		9.16	%		8.61	%
Tangible common equity to tangible assets:
Tangible common equity	$	573,867		$	559,422		$	545,885		$	525,691		$	498,488
Tangible assets		5,556,392			5,341,554			5,258,735			5,209,690			4,850,102
Tangible common equity to tangible assets		10.33	%		10.47	%		10.38	%		10.09	%		10.28	%
Return on average tangible common stockholders'<br><br><br>equity:
Tangible net income available to common<br><br><br>stockholders	$	4,136		$	17,101		$	16,591		$	14,429		$	13,680
Average tangible common stockholders' equity		575,573			556,115			538,603			511,254			487,794
Return on average tangible common<br><br><br>stockholders' equity		2.89	%		12.20	%		12.22	%		11.32	%		11.37	%
Adjusted return on average tangible common<br><br><br>stockholders' equity:
Adjusted tangible net income available to common<br><br><br>stockholders	$	4,652		$	17,308		$	17,409		$	17,133		$	15,080
Average tangible common stockholders' equity		575,573			556,115			538,603			511,254			487,794
Adjusted return on average tangible common<br><br><br>stockholders' equity		3.25	%		12.35	%		12.82	%		13.44	%		12.54	%
Tangible book value per share:
Tangible common equity	$	573,867		$	559,422		$	545,885		$	525,691		$	498,488
Common shares outstanding		38,383,021			38,256,500			38,169,126			38,115,219			36,398,144
Tangible book value per share	$	14.95		$	14.62		$	14.30		$	13.79		$	13.70