fult-20200721
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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

July 21, 2020
Date of Report (date of earliest event reported)

Fulton Financial Corporation
(Exact name of registrant as specified in its charter)
PA
0-10587
23-2195389
(State or other jurisdiction of incorporation)
(Commission File Number)
(I.R.S. Employer Identification No.)
One Penn Square,
Lancaster,
PA
17604
(Address of Principal Executive Offices)
(Zip Code)
(717) 291-2411
(Registrant's telephone number, including area code)

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)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common stock, par value $2.50FULTThe Nasdaq Stock Market, LLC

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.
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Item 2.02 Results of Operations and Financial Condition.

        On July 21, 2020, Fulton Financial Corporation (the "Corporation") issued a press release (the "Press Release") announcing its results of operations for the second quarter ended June 30, 2020. A copy of the Press Release and supplementary financial information which accompanied the Press Release, are attached as Exhibit 99.1 to this Current Report and are incorporated herein by reference. The Corporation also posted on its Investor Relations website, www.fult.com, presentation materials the Corporation intends to use during a conference call and webcast to discuss those results on Wednesday, July 22, 2020 at 10:00 a.m. Eastern Time. A copy of the presentation materials is attached as Exhibit 99.2 to this Current Report and is incorporated herein by reference. 

Forward-Looking Statements

This Current Report on Form 8-K, including the Exhibits hereto, may contain forward-looking statements with respect to the Corporation’s financial condition, results of operations and business. Do not unduly rely on forward-looking statements. Forward-looking statements can be identified by the use of words such as "may," "should," "will," "could," "estimates," "predicts," "potential," "continue," "anticipates," "believes," "plans," "expects," "future," "intends," "projects," the negative of these terms and other comparable terminology. Statements relating to the "outlook" or "Q3 2020 Outlook" contained in Exhibit 99.2 to this Current Report are forward-looking statements. These forward-looking statements may include projections of, or guidance on, the Corporation’s future financial performance, expected levels of future expenses, anticipated growth strategies, descriptions of new business initiatives and anticipated trends in the Corporation’s business or financial results.

Forward-looking statements are neither historical facts, nor assurance of future performance. Instead, they are based on current beliefs, expectations and assumptions regarding the future of the Corporation’s business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of the Corporation’s control, and actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not unduly rely on any of these forward-looking statements. Any forward-looking statement is based only on information currently available and speaks only as of the date when made. The Corporation undertakes no obligation, other than as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

A discussion of certain risks and uncertainties affecting the Corporation, and some of the factors that could cause the Corporation's actual results to differ materially from those described in the forward-looking statements, can be found in the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2019, Quarterly Reports on Form 10-Q for the quarter ended March 31, 2020 and other current and periodic reports, which have been or will be filed with the Securities and Exchange Commission and are or will be available in the Investor Relations section of the Corporation's website (www.fult.com) and on the Securities and Exchange Commission's website (www.sec.gov).


Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.

Exhibit No.Description
Press release dated July 21, 2020 containing financial information for the quarter ended June 30, 2020.
Presentation materials to be discussed during the conference call and webcast on July 22, 2020.
104Cover page Interactive Data File (the cover page XBRL tags are embedded within the Inline XBRL document)



SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: July 21, 2020
FULTON FINANCIAL CORPORATION
By: /s/ Mark R. McCollom
       Mark R. McCollom
       Senior Executive Vice President and
       Chief Financial Officer




Exhibit 99.1

FULTON FINANCIAL
CORPORATION


FOR IMMEDIATE RELEASE
Media Contact: Laura Wakeley (717) 291-2616
Investor Contact: Mark McCollom (717) 327-2567


Fulton Financial Announces Second Quarter Earnings

(July 21, 2020) – Lancaster, PA – Fulton Financial Corporation (NASDAQ:FULT) (“Fulton” or the “Corporation”) reported net income of $40 million, or $0.24 per diluted share, for the second quarter of 2020.

“COVID-19 continues to have a significant impact on our world and our company,” said E. Philip Wenger, Chairman and CEO, “however, we are pleased with what Fulton was able to achieve in the second quarter during this period of great uncertainty. Our earnings were strong, with lower credit losses and relatively stable fee income and expenses. And our employees have done an outstanding job, continuing to support our customers through this challenging and ever-changing environment."

Net Interest Income and Balance Sheet

Net interest income for the second quarter of 2020 was $153 million, a decrease of $8 million from the first quarter of 2020, driven by lower yields on loans and other interest-earning assets. Net interest margin for the second quarter of 2020 decreased 40 basis points, to 2.81% from 3.21% in the first quarter of 2020.
Total average assets for the second quarter of 2020 were $24.1 billion, an increase of $1.9 billion from the first quarter of 2020. Average loans, net of unearned income, of $18.3 billion increased $1.5 billion from the first quarter of 2020. The increase was principally due to loans originated under the Paycheck Protection Program ("PPP"), which were $1.9 billion as of June 30, 2020.
Average loans and yields, by type, for the second quarter of 2020 in comparison to the first quarter of 2020 are summarized in the following table:


Three months ended
June 30, 2020March 31, 2020Growth
BalanceYield (1)BalanceYield (1)$%
(dollars in thousands)
Average Loans, net of unearned income, by type:
    Real estate - commercial mortgage$6,875,872  3.47 %$6,746,766  4.20 %$129,106  1.9 %
    Commercial and industrial5,710,145  3.35 %4,446,750  4.21 %1,263,395  28.4 %
    Real estate - residential mortgage2,769,682  3.88 %2,670,019  3.97 %99,663  3.7 %
    Real estate - home equity1,271,190  3.91 %1,300,132  4.73 %(28,942) (2.2)%
    Real estate - construction941,079  3.53 %929,529  4.13 %11,550  1.2 %
    Consumer465,728  4.17 %466,415  4.34 %(687) (0.1)%
    Equipment lease financing284,658  3.44 %284,566  4.32 %92  0.0 %
    Other13,443  N/A15,890  N/A(2,447) (15.4)%
Total Average Loans, net of unearned income$18,331,797  3.52 %$16,860,067  4.23 %$1,471,730  8.7 %
(1) Presented on a fully-taxable equivalent basis using a 21% Federal tax rate and statutory interest expense disallowances.


Total average liabilities increased $1.9 billion, from the first quarter of 2020 driven by increases in noninterest-bearing demand deposits. Average deposits and interest rates, by type, for the second quarter of 2020 in comparison to the first quarter of 2020 are summarized in the following table:

Three months ended
June 30, 2020March 31, 2020Growth
BalanceRateBalanceRate$%
(dollars in thousands)
Average Deposits, by type:
    Noninterest-bearing demand$5,789,788  0.00 %$4,307,027  0.00 %$1,482,761  34.4 %
    Interest-bearing demand5,103,419  0.17 %4,649,905  0.49 %453,514  9.8 %
    Savings5,446,368  0.25 %5,127,662  0.56 %318,706  6.2 %
Total average demand and savings16,339,575  0.14 %14,084,594  0.36 %2,254,981  16.0 %
    Brokered312,121  0.54 %275,359  1.57 %36,762  13.4 %
    Time2,624,962  1.71 %2,761,474  1.84 %(136,512) (4.9)%
Total Average Deposits$19,276,658  0.36 %$17,121,427  0.62 %$2,155,231  12.6 %


Asset Quality

The provision for credit losses for the second quarter of 2020 was $20 million, which reflects current expected credit losses based on forecasted economic and other assumptions, including the estimated impacts of COVID-19, over the remaining expected lives of financial assets and off-balance-sheet credit exposures.
Non-performing assets were $145 million, or 0.59% of total assets, at June 30, 2020, a decrease from both March 31, 2020 and June 30, 2019. 


Annualized net charge-offs (recoveries) for the quarter ended June 30, 2020 were 0.09% of total average loans, compared to 0.26% and (0.04)% for the quarters ended March 31, 2020 and June 30, 2019, respectively.

Non-interest Income

Non-interest income in the second quarter of 2020, excluding investment securities gains, was $53 million, a decrease of $2 million, or 3%, from the first quarter of 2020, primarily driven by a decline in overdraft and wealth management fees, partially offset by higher mortgage banking income.
Mortgage banking income increased $4 million from the first quarter of 2020, reflecting the net result of a $10 million increase in gains on mortgage loan sales due largely to higher refinance activity, partially offset by a $7 million mortgage servicing rights impairment charge recorded in the second quarter of 2020 as a result of rapidly declining interest rates and related increases in current and expected levels of prepayments. A $1 million mortgage servicing rights impairment charge was recorded in the first quarter of 2020.
Compared to the second quarter of 2019, non-interest income, excluding investment securities gains, decreased $1 million or 2% in the second quarter of 2020 due mainly to declines in overdraft fees, merchant and card income and wealth management fees, partially offset by an increase in mortgage banking and capital markets income.
Net investment securities gains of $3 million were realized in the second quarter of 2020, related to a limited balance sheet restructuring that included $3 million of prepayment penalties recorded in non-interest expense for the redemption of FHLB advances.

Non-interest Expense

Non-interest expense was $143 million in the second quarter of 2020, relatively unchanged compared to the first quarter of 2020. The $3 million prepayment penalty on redemption of FHLB advances as well as an increase in salaries and employee benefits, were offset by decreases in multiple categories.
Compared to the second quarter of 2019, non-interest expenses decreased $1 million, or 1% due primarily to decreases in other outside services, occupancy and marketing, partially offset by increases in salaries and employee benefits and the FHLB prepayment penalty.

Income Tax Expense

The effective income tax rate for the second quarter of 2020 was 14%, as compared to 10% and 14% for the first quarter of 2020 and second quarter of 2019, respectively. The increase in the effective income tax rate compared to the first quarter of 2020 resulted from the increase in income before income taxes.

Additional information on Fulton is available on the Internet at www.fult.com.




Safe Harbor Statement

This news release may contain forward-looking statements with respect to the
Corporation’s financial condition, results of operations and business. Do not unduly rely on forward-looking statements. Forward-looking statements can be identified by the use of words such as "may," "should," "will," "could," "estimates," "predicts," "potential," "continue," "anticipates," "believes," "plans," "expects," "future," "intends," “projects,” the negative of these terms and other comparable terminology. These forward-looking statements may include projections of, or guidance on, the Corporation’s future financial performance, expected levels of future expenses, anticipated growth strategies, descriptions of new business initiatives and anticipated trends in the Corporation’s business or financial results.
Forward-looking statements are neither historical facts, nor assurance of future performance. Instead, they are based on current beliefs, expectations and assumptions regarding the future of the Corporation’s business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of the Corporation’s control, and actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not unduly rely on any of these forward-looking statements. Any forward-looking statement is based only on information currently available and speaks only as of the date when made. The Corporation undertakes no obligation, other than as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
A discussion of certain risks and uncertainties affecting the Corporation, and some of the factors that could cause the Corporation's actual results to differ materially from those described in the forward-looking statements, can be found in the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2019, Quarterly Report on Form 10-Q for the quarter ended March 31, 2020 and other current and periodic reports, which have been or will be filed with the Securities and Exchange Commission and are or will be available in the Investor Relations section of the Corporation's website (www.fult.com) and on the Securities and Exchange Commission's website (www.sec.gov).

Non-GAAP Financial Measures

The Corporation uses certain non-GAAP financial measures in this earnings release. These non-GAAP financial measures are reconciled to the most comparable GAAP measures in tables at the end of this release.









FULTON FINANCIAL CORPORATION
SUMMARY CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED)
in thousands, except per-share data and percentages
Three months ended
Jun 30Mar 31Dec 31Sep 30Jun 30
20202020201920192019
Ending Balances
Investments$2,974,813  $3,141,440  $2,867,378  $2,705,610  $2,853,358  
Loans, net of unearned income18,704,722  17,077,403  16,837,526  16,686,866  16,368,458  
Total assets24,617,863  22,929,859  21,886,040  21,703,618  21,308,670  
Deposits19,884,208  17,365,026  17,393,913  17,342,717  16,388,895  
Shareholders' equity2,340,501  2,285,748  2,342,176  2,324,016  2,308,798  
Average Balances
Investments$3,096,632  $3,071,828  $2,830,999  $2,829,672  $2,790,392  
Loans, net of unearned income18,331,797  16,860,067  16,768,057  16,436,507  16,316,076  
Total assets24,139,116  22,252,099  21,812,438  21,457,800  21,057,030  
Deposits19,276,658  17,121,428  17,449,565  16,950,667  16,375,457  
Shareholders' equity2,309,133  2,337,016  2,341,397  2,315,585  2,301,258  
Income Statement
Net interest income$152,754  $160,746  $159,270  $161,260  $164,544  
Provision for credit losses19,570  44,030  20,530  2,170  5,025  
Non-interest income55,922  54,644  55,281  59,813  54,316  
Non-interest expense143,006  142,552  138,974  146,770  144,168  
Income before taxes46,101  28,808  55,047  72,133  69,667  
Net income39,559  26,047  47,789  62,108  59,780  
Pre-provision net revenue(1)67,126  74,374  77,224  76,741  76,115  
Per Share
Net income (basic)$0.24  $0.16  $0.29  $0.38  $0.36  
Net income (diluted)$0.24  $0.16  $0.29  $0.37  $0.35  
Cash dividends$0.13  $0.13  $0.17  $0.13  $0.13  
Shareholders' equity (tangible)(1)$11.15  $10.84  $11.00  $10.91  $10.63  
Weighted average shares (basic)161,715  163,475  164,135  165,324  168,343  
Weighted average shares (diluted)162,267  164,417  165,039  166,126  169,168  


Asset Quality(2)
Net charge-offs (recoveries) to average loans (annualized)0.09 %0.26 %0.65 %0.15 %(0.04)%
Non-performing loans to total loans0.75 %0.82 %0.84 %0.81 %0.90 %
Non-performing assets to total assets0.59 %0.64 %0.68 %0.66 %0.73 %
ACL - loans(3) to total loans1.37 %1.40 %0.97 %1.00 %1.04 %
ACL - loans(3) to non-performing loans183 %170 %116 %122 %115 %
Non-performing assets to shareholders' equity (tangible) and ACL - loans (1)(3)7.04 %7.37 %7.51 %7.35 %7.97 %
Asset Quality, excluding PPP(1)(4)
Non-performing loans to total adjusted loans0.83 %
ACL - loans(3) to adjusted total loans1.53 %
Profitability
Return on average assets0.66 %0.47 %0.87 %1.15 %1.14 %
Return on average shareholders' equity6.89 %4.48 %8.10 %10.64 %10.42 %
Return on average shareholders' equity (tangible)(1)8.99 %5.84 %10.52 %14.03 %13.60 %
Net interest margin2.81 %3.21 %3.22 %3.31 %3.44 %
Efficiency ratio(1)66.4 %64.5 %63.1 %63.6 %64.2 %
Capital Ratios
Tangible common equity ratio(1)7.5 %7.8 %8.5 %8.5 %8.5 %
Tier 1 leverage ratio(5)7.4 %7.9 %8.4 %8.5 %8.7 %
Common equity Tier 1 capital ratio(5)9.5 %9.4 %9.7 %9.6 %10.0 %
Tier 1 capital ratio(5)9.5 %9.4 %9.7 %9.6 %10.0 %
Total risk-based capital ratio(5)14.0 %13.8 %11.8 %12.0 %12.4 %
(1) Non-GAAP financial measure. Refer to the calculation on the page titled “Reconciliation of Non-GAAP Measures” at the end of this document.
(2) Effective January 1, 2020, Fulton adopted Accounting Standards Update 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” referred to as the current expected credit loss model (“CECL”). This accounting standard requires that credit losses for financial assets and off-balance-sheet ("OBS") credit exposures be measured based on expected credit losses, rather than on incurred credit losses as in prior periods.
(3) "ACL - loans" relates to the allowance for credit losses ("ACL") specifically on "Loans, net of unearned income" and does not include the ACL related to OBS credit exposures.
(4) Asset quality information excluding Paycheck Protection Program (PPP) loans of $1.9 billion at June 30, 2020.
(5) Regulatory capital ratios as of June 30, 2020 are preliminary and prior periods are actual.




FULTON FINANCIAL CORPORATION
CONDENSED CONSOLIDATED ENDING BALANCE SHEETS (UNAUDITED)
dollars in thousands
 % Change from
Jun 30Mar 31Dec 31Sep 30Jun 30Mar 31Jun 30
2020202020192019201920202019
ASSETS
Cash and due from banks$141,702  $181,777  $132,283  $120,671  $107,091  (22.0)%32.3 %
Other interest-earning assets1,007,939  793,572  482,930  572,499  488,968  27.0 %106.1 %
Loans held for sale77,415  40,645  37,828  33,945  45,754  90.5 %69.2 %
Investment securities2,974,813  3,141,440  2,867,378  2,705,610  2,853,358  (5.3)%4.3 %
Loans, net of unearned income18,704,722  17,077,403  16,837,526  16,686,866  16,368,458  9.5 %14.3 %
Less: ACL - loans(256,537) (238,508) (163,622) (166,135) (170,233) 7.6 %50.7 %
     Net loans18,448,185  16,838,895  16,673,904  16,520,731  16,198,225  9.6 %13.9 %
Premises and equipment239,596  236,908  240,046  237,344  243,300  1.1 %(1.5)%
Accrued interest receivable73,720  59,365  60,898  60,447  62,984  24.2 %17.0 %
Goodwill and intangible assets535,039  535,171  535,303  534,178  535,249  — %— %
Other assets1,119,454  1,102,086  855,470  918,193  773,741  1.6 %44.7 %
    Total Assets$24,617,863  $22,929,859  $21,886,040  $21,703,618  $21,308,670  7.4 %15.5 %
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits$19,884,208  $17,365,026  $17,393,913  $17,342,717  $16,388,895  14.5 %21.3 %
Short-term borrowings572,551  1,386,808  883,241  832,860  1,188,390  (58.7)%(51.8)%
Other liabilities525,407  513,811  384,941  477,311  435,171  2.3 %20.7 %
FHLB advances and long-term debt1,295,196  1,378,466  881,769  726,714  987,416  (6.0)%31.2 %
    Total Liabilities22,277,362  20,644,111  19,543,864  19,379,602  18,999,872  7.9 %17.3 %
Shareholders' equity2,340,501  2,285,748  2,342,176  2,324,016  2,308,798  2.4 %1.4 %
    Total Liabilities and Shareholders' Equity$24,617,863  $22,929,859  $21,886,040  $21,703,618  $21,308,670  7.4 %15.5 %
LOANS, DEPOSITS AND SHORT-TERM BORROWINGS DETAIL:
Loans, by type:
Real estate - commercial mortgage$6,934,936  $6,895,069  $6,700,776  $6,604,634  $6,497,973  0.6 %6.7 %
Commercial and industrial5,970,473  4,451,239  4,446,701  4,494,496  4,365,248  34.1 %36.8 %
Real estate - residential mortgage2,862,226  2,718,290  2,641,465  2,570,793  2,451,966  5.3 %16.7 %
Real estate - home equity1,251,455  1,292,677  1,314,944  1,346,115  1,386,974  (3.2)%(9.8)%
Real estate - construction972,909  947,768  971,079  913,644  922,547  2.7 %5.5 %
Consumer465,610  468,172  463,164  464,213  452,874  (0.5)%2.8 %
Equipment lease financing and other247,113  304,188  299,397  292,971  290,876  (18.8)%(15.0)%
Total Loans, net of unearned income$18,704,722  $17,077,403  $16,837,526  $16,686,866  $16,368,458  9.5 %14.3 %
Deposits, by type:
Noninterest-bearing demand$6,239,055  $4,531,872  $4,453,324  $4,240,478  $4,226,404  37.7 %47.6 %
Interest-bearing demand5,099,405  4,724,520  4,720,188  4,771,109  4,083,615  7.9 %24.9 %
Savings5,667,893  5,092,865  5,153,941  5,094,387  4,938,998  11.3 %14.8 %
Total demand and savings17,006,353  14,349,257  14,327,453  14,105,974  13,249,017  18.5 %28.4 %
Brokered310,689  313,337  264,531  256,870  246,116  (0.8)%26.2 %
Time2,567,166  2,702,432  2,801,929  2,979,873  2,893,762  (5.0)%(11.3)%
Total Deposits$19,884,208  $17,365,026  $17,393,913  $17,342,717  $16,388,895  14.5 %21.3 %
Short-term borrowings, by type:
Customer funding572,551  461,808  383,241  337,860  338,390  24.0 %69.2 %
Federal funds purchased—  200,000  —  20,000  200,000  N/MN/M
Short-term FHLB advances—  725,000  500,000  475,000  650,000  N/MN/M
Total Short-term Borrowings$572,551  $1,386,808  $883,241  $832,860  $1,188,390  (58.7)%(51.8)%
N/M - Not meaningful
(1) "ACL - loans" relates to the ACL specifically on "Loans, net of unearned income" and does not include the ACL related to OBS credit exposures.




FULTON FINANCIAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
dollars in thousands
Three Months Ended % Change fromSix months ended
Jun 30Mar 31Dec 31Sep 30Jun 30Mar 31Jun 30Jun 30
202020202019201920192020201920202019% Change
Interest Income:
Interest income$180,696  $199,378  $202,159  $208,413  $210,034  (9.4)%(14.0)%$380,074  $414,734  (8.4)%
Interest expense27,942  38,632  42,889  47,153  45,490  (27.7)%(38.6)%66,574  86,875  (23.4)%
    Net Interest Income152,754  160,746  159,270  161,260  164,544  (5.0)%(7.2)%313,500  327,859  (4.4)%
Provision for credit losses19,570  44,030  20,530  2,170  5,025  (55.6)%N/M63,600  10,125  N/M
    Net Interest Income after Provision133,184  116,716  138,740  159,090  159,519  14.1 %(16.5)%249,900  317,734  (21.3)%
Non-Interest Income:
Wealth management13,407  15,055  14,419  13,867  14,153  (10.9)%(5.3)%28,462  27,392  3.9 %
Mortgage banking 9,964  6,234  5,076  6,658  6,593  59.8 %51.1 %16,198  11,365  42.5 %
Consumer banking:
  Card4,966  4,685  4,991  5,791  5,047  6.0 %(1.6)%9,651  9,733  (0.8)%
  Overdraft 2,107  4,058  4,750  4,682  4,413  (48.1)%(52.3)%6,165  8,517  (27.6)%
  Other consumer banking 2,065  2,496  2,688  2,860  2,907  (17.3)%(29.0)%4,561  5,494  (17.0)%
     Total consumer banking9,138  11,239  12,429  13,333  12,367  (18.7)%(26.1)%20,377  23,744  (14.2)%
Commercial banking:
   Merchant and card 5,326  5,624  5,841  6,166  6,512  (5.3)%(18.2)%10,950  12,070  (9.3)%
   Cash management 4,503  4,742  4,697  4,696  4,638  (5.0)%(2.9)%9,245  8,999  2.7 %
   Capital markets5,004  5,075  5,939  4,448  4,053  (1.4)%23.5 %10,079  6,568  53.5 %
   Other commercial banking 1,914  2,978  3,664  3,478  3,815  (35.7)%(49.8)%4,892  6,631  (26.2)%
     Total commercial banking 16,748  18,419  20,141  18,788  19,018  (9.1)%(11.9)%35,167  34,268  2.6 %
Other3,660  3,651  3,216  2,675  2,009  0.2 %82.2 %7,311  4,056  80.3 %
     Non-interest income before investment securities gains 52,917  54,598  55,281  55,321  54,140  (3.1)%(2.3)%107,515  100,825  6.6 %
Investment securities gains, net3,005  46  —  4,492  176  N/MN/M3,051  241  N/M
    Total Non-Interest Income55,922  54,644  55,281  59,813  54,316  2.3 %3.0 %110,566  101,066  9.4 %
Non-Interest Expense:
Salaries and employee benefits81,012  80,228  76,975  78,211  78,991  1.0 %2.6 %161,240  156,748  2.9 %
Net occupancy13,144  13,486  13,080  12,368  14,469  (2.5)%(9.2)%26,630  27,378  (2.7)%
Data processing and software12,193  11,645  11,468  11,590  11,268  4.7 %8.2 %23,838  21,621  10.3 %
Other outside services7,600  7,881  8,215  12,163  11,259  (3.6)%(32.5)%15,481  19,611  (21.1)%
Equipment 3,193  3,418  3,475  3,459  3,299  (6.6)%(3.2)%6,611  6,641  (0.5)%
Professional fees3,331  4,202  2,873  3,331  2,970  (20.7)%12.2 %7,533  6,930  8.7 %
Marketing1,303  1,579  1,503  3,322  2,863  (17.5)%(54.5)%2,882  5,023  (42.6)%
Amortization of tax credit investments1,450  1,450  1,505  1,533  1,492  — %(2.8)%2,900  2,983  (2.8)%
FDIC insurance2,133  2,808  2,177  239  2,755  (24.0)%(22.6)%4,941  5,364  (7.9)%
Intangible amortization132  132  142  1,071  107  — %23.4 %264  214  23.4 %
Prepayment penalty on FHLB advances2,878  —  —  4,326  —  N/MN/M2,878  —  N/M
Other14,637  15,723  17,561  15,157  14,695  (6.9)%(0.4)%30,360  29,479  3.0 %
    Total Non-Interest Expense143,006  142,552  138,974  146,770  144,168  0.3 %(0.8)%285,558  281,992  1.3 %
    Income Before Income Taxes46,101  28,808  55,047  72,133  69,667  60.0 %(33.8)%74,909  136,808  (45.2)%
Income tax expense6,542  2,761  7,258  10,025  9,887  136.9 %(33.8)%9,303  20,366  (54.3)%
    Net Income$39,559  $26,047  $47,789  $62,108  $59,780  51.9 %(33.8)%$65,606  $116,442  (43.7)%
PER SHARE:
Net income:
    Basic$0.24  $0.16  $0.29  $0.38  $0.36  50.0 %(33.3)%$0.40  $0.69  (42.0)%
    Diluted0.24  0.16  0.29  0.37  0.35  50.0 %(31.4)%0.40  0.68  (41.2)%
Cash dividends0.13  0.13  0.17  0.13  0.13  — %— %$0.26  $0.26  — %
Weighted average shares (basic)161,715  163,475  164,135  165,324  168,343  (1.1)%(3.9)%162,582  169,109  (3.9)%
Weighted average shares (diluted)162,267  164,417  165,039  166,126  169,168  (1.3)%(4.1)%163,326  170,042  (3.9)%





FULTON FINANCIAL CORPORATION
CONDENSED CONSOLIDATED AVERAGE BALANCE SHEET ANALYSIS (UNAUDITED)
dollars in thousands
Three months ended
June 30, 2020March 31, 2020June 30, 2019
AverageInterestYield/AverageInterestYield/AverageInterestYield/
Balance(1)RateBalance(1)RateBalance(1)Rate
ASSETS
Interest-earning assets:
Loans, net of unearned income$18,331,797  $160,613  3.52 %$16,860,067  $177,496  4.23 %$16,316,076  $190,694  4.69 %
Taxable investment securities2,200,870  15,171  2.76 %2,284,457  16,294  2.85 %2,348,443  15,935  2.71 %
Tax-exempt investment securities830,836  6,737  3.23 %720,223  5,960  3.29 %444,227  4,141  3.70 %
Total Investment Securities3,031,706  21,908  2.89 %3,004,680  22,254  2.96 %2,792,670  20,076  2.87 %
Loans held for sale55,608  509  3.66 %27,178  320  4.71 %24,568  350  5.71 %
Other interest-earning assets815,910  766  0.38 %602,270  2,532  1.69 %409,617  2,168  2.12 %
Total Interest-earning Assets22,235,021  183,796  3.32 %20,494,195  202,602  3.97 %19,542,931  213,288  4.37 %
Noninterest-earning assets:
Cash and due from banks153,728  138,248  116,285  
Premises and equipment240,417  239,619  240,666  
Other assets1,761,038  1,590,666  1,321,057  
Less: ACL - loans(2)(251,088) (210,629) (163,909) 
Total Assets$24,139,116  $22,252,099  $21,057,030  
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing liabilities:
Demand deposits$5,103,419  $2,219  0.17 %$4,649,905  $5,643  0.49 %$4,186,280  $8,173  0.78 %
Savings deposits5,446,368  3,331  0.25 %5,127,662  7,110  0.56 %4,925,788  10,550  0.86 %
Brokered deposits312,121  422  0.54 %275,359  1,073  1.57 %246,154  1,582  2.58 %
Time deposits2,624,962  11,145  1.71 %2,761,474  12,614  1.84 %2,816,424  12,245  1.74 %
Total Interest-bearing Deposits13,486,870  17,118  0.51 %12,814,400  26,440  0.83 %12,174,646  32,550  1.07 %
Short-term borrowings707,771  517  0.29 %1,303,047  4,073  1.25 %941,504  4462  1.89 %
FHLB advances and long-term debt1,361,421  10,307  3.03 %1,063,214  8,119  3.06 %1,051,919  8,480  3.23 %
Total Interest-bearing Liabilities$15,556,062  $27,942  0.72 %$15,180,661  $38,632  1.02 %$14,168,069  $45,492  1.29 %
Noninterest-bearing liabilities:
Demand deposits5,789,788  4,307,027  4,200,810  
Total Deposits/Cost of Deposits19,276,658  0.36 %17,121,427  0.62 %16,375,456  0.80 %
Other484,133  427,395  386,893  
Total Liabilities$21,829,983  $19,915,083  $18,755,772  
Total Interest-bearing liabilities and non-interest bearing deposits ("Cost of Funds")21,345,850  0.53 %19,487,688  0.80 %18,368,879  0.93 %
Shareholders' equity2,309,133  2,337,016  2,301,258  
Total Liabilities and Shareholders' Equity$24,139,116  $22,252,099  $21,057,030  
Net interest income/net interest margin (fully taxable equivalent)155,854  2.81 %163,970  3.21 %167,796  3.44 %
Tax equivalent adjustment(3,100) (3,224) (3,252) 
Net interest income$152,754  $160,746  $164,544  
(1) Presented on a fully taxable-equivalent basis using a 21% federal tax rate and statutory interest expense disallowances.






FULTON FINANCIAL CORPORATION
AVERAGE LOANS, DEPOSITS AND SHORT-TERM BORROWINGS DETAIL (UNAUDITED):
dollars in thousands
Three months ended% Change from
Jun 30Mar 31Dec 31Sep 30Jun 30Mar 31Jun 30
2020202020192019201920202019
Loans, by type:
Real estate - commercial mortgage$6,875,872  $6,746,766  $6,561,029  $6,489,456  $6,424,213  1.9 %7.0 %
Commercial and industrial5,710,145  4,446,750  4,574,047  4,414,992  4,440,860  28.4 %28.6 %
Real estate - residential mortgage2,769,682  2,670,019  2,606,136  2,512,899  2,366,685  3.7 %17.0 %
Real estate - home equity1,271,190  1,300,132  1,331,088  1,364,161  1,404,141  (2.2)%(9.5)%
Real estate - construction941,079  929,529  934,556  905,060  943,080  1.2 %(0.2)%
Consumer465,728  466,415  464,606  457,524  445,666  (0.1)%4.5 %
Equipment lease financing and other298,101  300,456  296,595  292,415  291,431  (0.8)%2.3 %
Total Loans, net of unearned income$18,331,797  $16,860,067  $16,768,057  $16,436,507  $16,316,076  8.7 %12.4 %
Deposits, by type:
Noninterest-bearing demand$5,789,788  $4,307,027  $4,324,568  $4,247,820  $4,200,810  34.4 %37.8 %
Interest-bearing demand5,103,419  4,649,905  4,699,040  4,448,112  4,186,280  9.8 %21.9 %
Savings5,446,368  5,127,662  5,205,260  5,026,316  4,925,788  6.2 %10.6 %
     Total demand and savings16,339,575  14,084,594  14,228,868  13,722,248  13,312,878  16.0 %22.7 %
Brokered312,121  275,359  261,689  253,426  246,154  13.4 %26.8 %
Time2,624,962  2,761,474  2,959,008  2,974,993  2,816,425  (4.9)%(6.8)%
Total Deposits$19,276,658  $17,121,427  $17,449,565  $16,950,667  $16,375,457  12.6 %17.7 %
Short-term borrowings, by type:
Customer funding$546,716  $428,240  $377,529  $332,893  $344,867  27.7 %58.5 %
Federal funds purchased74,231  186,868  91,467  101,022  181,769  (60.3)%(59.2)%
Short-term FHLB advances and other borrowings86,824  687,937  248,815  485,782  414,868  (87.4)%(79.1)%
Total Short-term borrowings$707,771  $1,303,045  $717,811  $919,697  $941,504  (45.7)%(24.8)%





FULTON FINANCIAL CORPORATION
CONDENSED CONSOLIDATED AVERAGE BALANCE SHEET ANALYSIS (UNAUDITED)
dollars in thousands
Six months ended June 30
20202019
AverageAverage
BalanceInterest (1)Yield/RateBalanceInterest (1)Yield/Rate
ASSETS
Interest-earning assets:
Loans, net of unearned income$17,595,932  $338,110  3.86 %$16,255,562  $376,816  4.67 %
Taxable investment securities2,242,663  31,465  2.81 %2,317,257  31,370  2.71 %
Tax-exempt investment securities775,530  12,698  3.26 %444,180  8,291  3.71 %
Total Investment Securities3,018,193  44,163  2.92 %2,761,437  39,661  2.87 %
Loans held for sale41,393  829  4.00 %20,523  590  5.76 %
Other interest-earning assets709,091  3,297  4.31 %388,016  4,170  2.16 %
Total Interest-earning Assets$21,364,609  $386,399  3.63 %$19,425,538  $421,237  4.36 %
Noninterest-earning assets:
Cash and due from banks145,988  113,504  
Premises and equipment240,019  238,905  
Other assets1,675,849  1,259,388  
Less: allowance for loan losses(230,858) (162,624) 
Total Assets$23,195,607  $20,874,711  
LIABILITIES AND SHAREHOLDERS' EQUITY
Interest-bearing liabilities:
Demand deposits$4,876,662  $8,020  0.33 %$4,170,221  $15,692  0.76 %
Savings deposits5,287,015  10,441  0.40 %4,919,357  20,512  0.84 %
Brokered deposits293,756  1,495  1.02 %233,244  2,964  2.56 %
Time deposits2,693,202  23,602  1.76 %2,791,216  23,071  1.67 %
Total Interest-bearing Deposits$13,150,635  $43,558  0.67 %$12,114,038  $62,239  1.04 %
Short-term borrowings1,005,409  4,590  0.91 %881,115  8,044  1.83 %
FHLB advances and long-term debt1,212,318  18,426  3.04 %1,027,328  16,594  3.24 %
Total Interest-bearing Liabilities$15,368,362  $66,574  0.87 %$14,022,481  $86,877  1.25 %
Noninterest-bearing liabilities:
Demand deposits5,048,408  4,211,782  
Total Deposits/Cost of Deposits18,199,043  0.48 %16,325,820  0.77 %
Other455,763  357,170  
Total Liabilities$20,872,533  $18,591,433  
Total Interest-bearing liabilities and non-interest bearing deposits ("Cost of Funds")20,416,770  0.65 %18,234,263  0.96 %
Shareholders' equity2,323,074  2,283,278  
Total Liabilities and Shareholders' Equity$23,195,607  $20,874,711  
Net interest income/net interest margin (fully taxable equivalent)319,825  3.01 %334,360  3.46 %
Tax equivalent adjustment(6,325) (6,501) 
Net interest income$313,500  $327,859  
(1) Presented on a fully taxable-equivalent basis using a 21% federal tax rate and statutory interest expense disallowances.




FULTON FINANCIAL CORPORATION
AVERAGE LOANS, DEPOSITS AND SHORT-TERM BORROWINGS DETAIL (UNAUDITED):
dollars in thousands
Six months ended June 30
20202019% Change
Loans, by type:
Real estate - commercial mortgage$6,811,318  $6,401,305  6.4 %
Commercial and industrial5,078,448  4,451,342  14.1 %
Real estate - residential mortgage2,719,851  2,321,897  17.1 %
Real estate - home equity1,285,661  1,418,776  (9.4)%
Real estate - construction935,304  936,699  (0.1)%
Consumer466,071  435,131  7.1 %
Equipment lease financing and other299,279  290,412  3.1 %
Total Loans, net of unearned income$17,595,932  $16,255,562  8.2 %
Deposits, by type:
Noninterest-bearing demand$5,048,408  $4,211,782  19.9 %
Interest-bearing demand4,876,662  4,170,221  16.9 %
Savings5,287,015  4,919,357  7.5 %
   Total demand and savings15,212,085  13,301,360  14.4 %
Brokered293,756  233,244  25.9 %
Time2,693,202  2,791,216  (3.5)%
Total Deposits$18,199,043  $16,325,820  11.5 %
Short-term borrowings, by type:
Customer funding$487,478  $356,767  36.6 %
Federal funds purchased 130,549  169,514  (23.0)%
Short-term FHLB advances and other borrowings387,382  354,834  9.2 %
Total Short-term Borrowings$1,005,409  $881,115  14.1 %




FULTON FINANCIAL CORPORATION
ASSET QUALITY INFORMATION (UNAUDITED)
dollars in thousands
Three months ended
Jun 30Mar 31Dec 31Sep 30Jun 30
20202020201920192019
Allowance for credit losses related to Loans, net of unearned income:
Balance at beginning of period$238,508  $163,620  $166,135  $170,233  $162,109  
Impact of adopting CECL—  45,724  —  —  —  
Loans charged off:
    Commercial and industrial(3,480) (10,899) (30,547) (7,181) (1,895) 
    Real estate - commercial mortgage(2,324) (855) (68) (394) (230) 
    Consumer and home equity(1,303) (1,529) (1,416) (1,375) (1,001) 
    Real estate - residential mortgage(235) (187) (223) (533) (134) 
    Real estate - construction(17) —  —  (45) (3) 
    Equipment lease financing and other(688) (533) (727) (600) (448) 
    Total loans charged off(8,047) (14,003) (32,981) (10,128) (3,711) 
Recoveries of loans previously charged off:
    Commercial and industrial2,978  1,734  2,487  2,311  2,680  
    Real estate - commercial mortgage95  244  1,453  444  169  
    Consumer and home equity649  646  437  348  802  
    Real estate - residential mortgage112  85  206  440  211  
    Real estate - construction—  70  1,098  164  1,245  
    Equipment lease financing and other92  108  182  107  148  
    Recoveries of loans previously charged off3,926  2,887  5,863  3,814  5,255  
Net loans (charged off) recovered(4,121) (11,116) (27,118) (6,314) 1,544  
Provision for credit losses22,150  40,280  24,603  2,216  6,580  
Balance at end of period$256,537  $238,508  $163,620  $166,135  $170,233  
Net charge-offs (recoveries) to average loans (annualized)0.09 %0.26 %0.65 %0.15 %(0.04)%
Allowance credit losses related to OBS Credit Exposures(1)
Balance at beginning of period$18,963  $2,588  $6,662  $6,708  $8,263  
Impact of adopting CECL—  12,625  —  —  —  
Provision for credit losses (2,580) 3,750  (4,074) (46) (1,555) 
Balance at end of period$16,383  $18,963  $2,588  $6,662  $6,708  
NON-PERFORMING ASSETS:
Non-accrual loans$125,037  $120,345  $125,098  $124,287  $133,118  
Loans 90 days past due and accruing14,767  19,593  16,057  11,689  14,598  
    Total non-performing loans139,804  139,938  141,155  135,976  147,716  
Other real estate owned5,418  6,593  6,831  7,706  7,241  
Total non-performing assets$145,222  $146,531  $147,986  $143,682  $154,957  
NON-PERFORMING LOANS, BY TYPE:
Commercial and industrial$39,730  $41,318  $49,491  $37,126  $47,260  
Real estate - commercial mortgage42,374  36,538  37,279  45,710  43,850  
Real estate - residential mortgage22,887  25,832  22,411  20,150  21,659  
Consumer and home equity11,911  11,226  11,026  11,012  12,378  
Real estate - construction4,525  4,379  4,306  4,312  4,632  
Equipment lease financing and other18,377  20,645  16,642  17,666  17,937  
Total non-performing loans$139,804  $139,938  $141,155  $135,976  $147,716  
(1) The allowance for credit losses related to OBS Credit Exposures is presented in "other liabilities" on the consolidated balance sheets.




FULTON FINANCIAL CORPORATION
RECONCILIATION OF NON-GAAP MEASURES (UNAUDITED)
in thousands, except per share data and percentages
Explanatory note:This press release contains supplemental financial information, as detailed below, which has been derived by methods other than Generally Accepted Accounting Principles ("GAAP"). The Corporation has presented these non-GAAP financial measures because it believes that these measures provide useful and comparative information to assess trends in the Corporation's results of operations. Presentation of these non-GAAP financial measures is consistent with how the Corporation evaluates its performance internally and these non-GAAP financial measures are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in the Corporation's industry. Management believes that these non-GAAP financial measures, in addition to GAAP measures, are also useful to investors to evaluate the Corporation's results. Investors should recognize that the Corporation's presentation of these non-GAAP financial measures might not be comparable to similarly-titled measures of other companies. These non-GAAP financial measures should not be considered a substitute for GAAP basis measures, and the Corporation strongly encourages a review of its condensed consolidated financial statements in their entirety. Reconciliations of these non-GAAP financial measures to the most directly comparable GAAP measure follow:
Three months ended
Jun 30Mar 31Dec 31Sep 30Jun 30
20202020201920192019
Shareholders' equity (tangible), per share
Shareholders' equity$2,340,501  $2,285,748  $2,342,176  $2,324,016  $2,308,798  
Less: Goodwill and intangible assets(535,039) (535,171) (535,303) (534,178) (535,249) 
Tangible shareholders' equity (numerator)$1,805,462  $1,750,577  $1,806,873  $1,789,838  $1,773,549  
Shares outstanding, end of period (denominator)161,958  161,435  164,218  164,036  166,903  
Shareholders' equity (tangible), per share$11.15  $10.84  $11.00  $10.91  $10.63  
Return on average shareholders' equity (tangible)
Net income$39,559  $26,047  $47,789  $62,108  $59,780  
Plus: Intangible amortization, net of tax104  104  112  846  85  
(Numerator)$39,663  $26,151  $47,901  $62,954  $59,865  
Average shareholders' equity$2,309,133  $2,337,016  $2,341,397  $2,315,585  $2,301,258  
Less: Average goodwill and intangible assets(535,103) (535,235) (534,190) (535,184) (535,301) 
Average tangible shareholders' equity (denominator)$1,774,030  $1,801,781  $1,807,207  $1,780,401  $1,765,957  
Return on average shareholders' equity (tangible), annualized8.99 %5.84 %10.52 %14.03 %13.60 %
Tangible Common Equity to Tangible Assets (TCE Ratio)
Shareholders' equity$2,340,501  $2,285,748  $2,342,176  $2,324,016  $2,308,798  
Less: Goodwill and intangible assets(535,039) (535,171) (535,303) (534,178) (535,249) 
Tangible shareholders' equity (numerator)$1,805,462  $1,750,577  $1,806,873  $1,789,838  $1,773,549  
Total assets$24,617,863  $22,929,859  $21,886,040  $21,703,618  $21,308,670  
Less: Goodwill and intangible assets(535,039) (535,171) (535,303) (534,178) (535,249) 
Total tangible assets (denominator)$24,082,824  $22,394,688  $21,350,737  $21,169,440  $20,773,421  
Tangible Common Equity to Tangible Assets7.50 %7.82 %8.46 %8.45 %8.54 %
Efficiency ratio
Non-interest expense$143,006  $142,552  $138,974  $146,770  $144,168  
Less: Intangible amortization(132) (132) (142) (1,071) (107) 
Less: Amortization of tax credit investments(1,450) (1,450) (1,505) (1,533) (1,492) 
Less: Prepayment penalty of FHLB advances(2,878) —  —  (4,326) —  
Non-interest expense (numerator)$138,546  $140,970  $137,327  $139,840  $142,569  
Net interest income (fully taxable equivalent)$155,854  $163,970  $162,479  $164,517  $167,794  
Plus: Total Non-interest income55,922  54,644  55,281  59,813  54,316  
Less: Investment securities gains, net(3,005) (46) —  (4,492) (176) 
Net interest income (denominator)$208,771  $218,568  $217,760  $219,838  $221,934  
Efficiency ratio66.4 %64.5 %63.1 %63.6 %64.2 %
Non-performing assets to shareholders' equity (tangible) and ACL - loans(1)
Non-performing assets (numerator)$145,222  $146,531  $147,986  $143,682  $154,957  
Tangible shareholders' equity$1,805,462  $1,750,577  1,806,873  1,789,838  $1,773,549  
Plus: ACL - loans256,537  238,508  163,622  166,135  170,233  
Tangible shareholders' equity and ACL - loans (denominator)$2,061,999  $1,989,085  $1,970,495  $1,955,973  $1,943,782  
Non-performing assets to tangible shareholders' equity and ACL - loans7.04 %7.37 %7.51 %7.35 %7.97 %


Asset Quality, excluding PPP
Non-performing loans (numerator)$139,804  $139,938  $141,155  $135,976  $147,716  
Loans, net of unearned income$18,704,722  $17,077,403  $16,837,526  $16,686,866  $16,368,458  
Less: PPP loans(1,937,034) —  —  —  —  
Total adjusted loans (denominator)$16,767,688  $16,767,688  $16,767,688  $16,767,688  $16,767,688  
Non-performing loans to adjusted total loans0.83 %0.83 %0.84 %0.81 %0.88 %
ACL - loans (numerator)$256,537  $238,508  163,622  166,135  $170,233  
Loans, net of unearned income$18,704,722  $17,077,403  $16,837,526  $16,686,866  $16,368,458  
Less: PPP loans(1,937,034) —  —  —  —  
Total adjusted loans (denominator)$16,767,688  $17,077,403  $16,837,526  $16,686,866  $16,368,458  
ACL - loans to adjusted total loans1.53 %1.40 %0.97 %1.00 %1.04 %
Pre-provision net revenue
Net interest income$152,754  $160,746  $159,270  $161,260  $164,544  
Non-interest income55,922  54,644  55,281  59,813  54,316  
Less: Investment securities gains, net(3,005) (46) —  (4,492) (176) 
Total revenue$205,671  $215,344  $214,551  $216,581  $218,684  
Non-interest expense$143,006  $142,552  $138,974  $146,770  $144,168  
Less: Prepayment penalty of FHLB advances(2,878) —  —  (4,326) —  
Less: Amortization on tax credit investments (1,450) (1,450) (1,505) (1,533) (1,492) 
Less: Intangible amortization(132) (132) (142) (1,071) (107) 
Total non-interest expense$138,546  $140,970  $137,327  $139,840  $142,569  
Pre-provision net revenue$67,126  $74,374  $77,224  $76,741  $76,115  
Note: numbers may not sum due to rounding.
(1) "ACL - loans" relates to the ACL specifically on "Loans, net of unearned income" and does not include the ACL related to OBS credit exposures.


2020 SECOND QUARTER RESULTS NASDAQ: FULT Data as of June 30, 2020 unless otherwise noted

 
FORWARD-LOOKING STATEMENTS This presentation may contain forward-looking statements with respect to the Corporation’s financial condition, results of operations and business. Do not unduly rely on forward-looking statements. Forward-looking statements can be identified by the use of words such as "may," "should," "will," "could," "estimates," "predicts," "potential," "continue," "anticipates," "believes," "plans," "expects," "future," "intends," “projects,” the negative of these terms and other comparable terminology. These forward-looking statements may include projections of, or guidance on, the Corporation’s future financial performance, expected levels of future expenses, anticipated growth strategies, descriptions of new business initiatives and anticipated trends in the Corporation’s business or financial results. Management’s Q3 2020 Outlook contained herein is comprised of forward-looking statements. Forward-looking statements are neither historical facts, nor assurance of future performance. Instead, they are based on current beliefs, expectations and assumptions regarding the future of the Corporation’s business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of the Corporation’s control, and actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not unduly rely on any of these forward-looking statements. Any forward-looking statement is based only on information currently available and speaks only as of the date when made. The Corporation undertakes no obligation, other than as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. A discussion of certain risks and uncertainties affecting the Corporation, and some of the factors that could cause the Corporation’s actual results to differ materially from those described in the forward-looking statements, can be found in the sections entitled “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2019, Quarterly Report on Form 10-Q for the quarter end March 31, 2020 and other current and periodic reports, which have been, or will be, filed with the Securities and Exchange Commission and are or will be available in the Investor Relations section of the Corporation’s website (www.fult.com) and on the Securities and Exchange Commission’s website (www.sec.gov). The Corporation uses certain non-GAAP financial measures in this presentation. These non-GAAP financial measures are reconciled to the most comparable GAAP measures at the end of this presentation. 2

 
COVID-19 IMPACT: COMMERCIAL & CONSUMER 1. Ending balances are as of June 30, 2020 and based on regulatory classifications. 2. Percentages of total ending loan balances by each category as of July 16, 2020. 3

 
LOAN PORTFOLIO COMPOSITION (Selected Sectors) 1. Sector non-performing loans to total sector loans. 2. Sector criticized and classified loans to total sector loans. Criticized and classified loans consist of loans that have been assigned a risk rating of less than “pass” under the Corporation’s internal risk rating process. Under the Corporation’s internal risk rating process, loans assigned a “pass” rating do not currently pose undue credit risk and can range from the highest to average quality, depending on the degree of potential risk. Criticized and classified loans consist of loans that have been assigned an internal risk rating of “special mention,” “substandard” and lower. Criticized and classified loans present heightened credit risk, may be inadequately protected by current sound worth and paying capacity of the borrower, and may have a well-defined weakness or weaknesses that jeopardize the normal repayment of the debt. 4

 
DETAILED REVIEW: INVESTOR REAL ESTATE 1. IRE segment non-performing loans to total IRE segment loans. 2. Segment criticized and classified loans to total segment loans. Criticized and classified loans consist of loans that have been assigned a risk rating of less than “pass” under the Corporation’s internal risk rating process. Under the Corporation’s internal risk rating process, loans assigned a “pass” rating do not currently pose undue credit risk and can range from the highest to average quality, depending on the degree of potential risk. Criticized and classified loans consist of loans that have been assigned an internal risk rating of “special mention,” “substandard” and lower. Criticized and classified loans present heightened credit risk, may be inadequately protected by current sound worth and paying capacity of the borrower, and may have a well-defined weakness or weaknesses that jeopardize the normal repayment of the debt. 5

 
INCOME STATEMENT SUMMARY Change From 2Q20 1Q20 2Q19 (dollars in thousands, except per-share data) Net Interest Income $ 152,754 $ (7,992) $ (11,790) Provision for Credit Losses 19,570 (24,460) 14,545 Non-Interest Income 52,917 (1,681) (1,223) Securities Gains 3,005 2,959 2,829 Non-Interest Expense 143,006 454 (1,162) Income before Income Taxes 46,101 17,293 (23,566) Income Taxes 6,542 3,781 (3,345) Net Income $ 39,559 $ 13,512 $ (20,221) Net income per share (diluted) $ 0.24 $ 0.08 $ (0.11) ROA (1) 0.66 % 0.19 % (0.48) % ROE (2) 6.89 % 2.41 % (3.53) % ROE (tangible) (3) 8.99 % 3.15 % (4.61) % Efficiency ratio (3) 66.4 % 1.9 % 2.1 % 1. ROA is return an average assets determined by dividing net income for the period indicated by average assets, annualized. 2. ROE is return on average shareholders’ equity determined by dividing net income for the period indicated by average shareholders’ equity, annualized. 3. Non-GAAP financial measure. Please refer to the calculation and management’s reasons for using this measure on the slide titled “Non-GAAP Reconciliation” at the end of this presentation. 6

 
NET INTEREST INCOME AND MARGIN Net Interest Income & Net Interest Margin Average Interest-Earning Assets & Yields ($ IN BILLIONS) ($ IN MILLIONS) 4.37% $20 4.25% 4.07% 3.97% 5.00% 3.32% 4.00% $15 $200 4.00% 3.00% $16 $16 $17 $17 $18 $10 2.00% $180 3.75% $5 1.00% $165 $161 $161 $4 $4 $159 $3 $3 $3 0.00% $160 $153 3.50% 2Q19 3Q19 4Q19 1Q20 2Q20 $140 3.44% Securities & Other Loans 3.31% 3.25% Interest-Earning Asset Yield (FTE) $120 3.22% 3.21% 3.00% Average Liabilities & Rates $100 ($ IN BILLIONS) 2.75% $80 2.81% 3.00% $20 $2 $2 $2 $2 $2 $19 $60 2.50% $15 $16 $17 $17 $17 2.00% $10 $40 2.25% 1.29% 1.29% 1.00% $5 1.16% 1.02% 0.72% $20 $— 0.00% 2.00% 2Q19 3Q19 4Q19 1Q20 2Q20 2Q19 3Q19 4Q19 1Q20 2Q20 Cost of Interest-bearing Liabilities Net Interest Income Borrowings Net Interest Margin (Fully-taxable equivalent basis, or FTE) Deposits 7

 
ASSET QUALITY ($ IN MILLIONS) Provision for Credit Losses Non-Performing Loans (NPLs) & NPLs to Loans $150 $148 1.50% $50 $44 $145 0.81% $141 1.00% $40 $140 $140 $140 0.90% 0.84% 0.82% $136 0.75% $30 0.50% $135 $21 $20 $20 $130 0.00% 2Q19 3Q19 4Q19 1Q20 2Q20 $10 $5 $2 NPL NPLs/Loans 2Q19 3Q19 4Q19 1Q20 2Q20 Net Charge-offs (NCOs) and NCOs to Average Loans ACL(1) to NPLs & Loans $40 1.00% 0.65% 200% 183% 2.00% 170% $30 $27 175% 1.75% 0.26% 0.50% 0.15% 150% -0.04% 1.50% $20 122% 0.00% 125% 115% 116% $11 0.09% 1.40% 1.37% 1.25% $10 $6 100% 1.04% $4 (0.50)% 75% 1.00% $0 1.00% 0.97% $(2) (1.00)% 50% 0.75% 2Q19 3Q19 4Q19 1Q20 2Q20 2Q19 3Q19 4Q19 1Q20 2Q20 Net (charge-offs)/recoveries ACL/NPLs ACL/Loans NCOs/Average Loans (annualized) 1. The allowance for credit losses (“ACL”) relates specifically to "Loans, net of unearned income" and does not include the ACL related to off-balance-sheet credit exposures. 8

 
NON-INTEREST INCOME(1) Three months ended June 30, 2020 (percent of total non-interest income) 2Q20 1Q20 Change (dollars in thousands) n Wealth Management $ 13,407 $ 15,055 $ (1,648) 7% n Mortgage Banking 9,964 6,234 3,730 25% n Consumer Banking 9,138 11,239 (2,101) n Commercial Banking 16,748 18,419 (1,671) n Other 3,660 3,651 9 32% Total $ 52,917 $ 54,598 $ (1,681) Non-interest income(1) decreased 3% from 1Q20 19% Decreases in: 17% n Brokerage income n Overdraft fees n Other service charges on deposits for commercial customers Increases in: Wealth Management Mortgage Banking n Net result of $10.3 million increase in gains on mortgage loan sales Consumer Banking (higher refinance activity), partially offset by $6.6 million valuation Commercial Banking allowance on MSRs. Other (1) Excluding investment securities gains 9

 
NON-INTEREST EXPENSE Three months ended June 30, 2020 (percent of total non-interest expense) 2Q20 1Q20 Change 18% (dollars in thousands) n Salaries and Benefits $ 81,012 $ 80,228 $ 784 n Occupancy 13,144 13,486 (342) 2% n Data Processing and Software 12,193 11,645 548 n Other Outside Services 7,600 7,881 (281) 5% n Prepayment Penalty on FHLB Advances 2,878 — 2,878 57% n Other 26,179 29,312 (3,133) 9% Total $ 143,006 $ 142,552 $ 454 9% Non-interest expense increased slightly from 1Q20 Increases in: n Additional bonus and overtime expenses n Prepayment Penalty on FHLB Advances recorded in 2Q20 Salaries and Benefits Decreases in: Occupancy Data Processing and Software Other Outside Services n Professional fees and FDIC insurance expense Prepayment penalty on FHLB Advances Other 10

 
LIQUIDITY POSITION COMMENTARY AVAILABLE LIQUIDITY • Liquidity remains strong and diverse. • Continue efforts to increase capacity with the FHLB and Federal Reserve. • Sitting on excess cash reserves since mid-March. • Federal Reserve facility for funding of PPP (PPPLF), is available if needed. • Additional liquidity is available through Federal Funds lines and brokered deposits. 11

 
CAPITAL POSITION REMAINS STRONG 14.0% 14.0% 12.0% $658 10.0% 9.5% 9.5% $185 $468 8.0% 7.4% $579 6.0% 4.0% 2.0% Tier 1 Leverage Tier 1 Risk Based CE Tier 1 Total Risk Based Regulatory Minimums Excess(2) Suspended share repurchases in Mid-March. Dividend remains at $0.13 quarterly. 1. Regulatory capital ratios as of June 30, 2020 are preliminary. 2. Excesses shown, in millions, are to regulatory minimums, including the 250 basis point capital conservation buffer, except for Tier 1 Leverage 12 which is the well-capitalized minimum. Dollars are in millions.

 
Q3 2020 OUTLOOK All previous guidance for 2020 has been withdrawn due to the impact from COVID-19. At this time, select guidance for the third quarter of 2020 will be provided on the following areas in comparison to second quarter of 2020 actual results, except effective tax rate is the expected range of the effective tax rate for the third quarter of 2020: • Loans: Overall loan growth expected to be +/- 1 - 2%. • Deposits: Overall deposit growth expected to be 1 - 2%, with seasonal municipal deposit inflows offset by modest runoff as PPP funds. • Net Interest Income: In the range of $150 - $153 million • Non-Interest Income: Consistent with second quarter 2020, in the range of $50 - $53 million. • Non-Interest Expense: Consistent with second quarter 2020, in the range of $139 - $142 million. • Effective Tax Rate: Between 11.5% - 12.5% 13

 
NON-GAAP RECONCILIATION Note: The Corporation has presented the following non-GAAP (Generally Accepted Accounting Principles) financial measures because it believes that these measures provide useful and comparative information to assess trends in the Corporation's results of operations and financial condition. Presentation of these non-GAAP financial measures is consistent with how the Corporation evaluates its performance internally and these non-GAAP financial measures are frequently used by securities analysts, investors and other interested parties in the evaluation of companies in the Corporation's industry. Investors should recognize that the Corporation's presentation of these non-GAAP financial measures might not be comparable to similarly-titled measures of other companies. These non-GAAP financial measures should not be considered a substitute for GAAP basis measures and the Corporation strongly encourages a review of its condensed consolidated financial statements in their entirety. Three months ended Jun 30 Mar 31 Dec 31 Sep 30 Jun 30 Return on average shareholders' equity (tangible) 2020 2020 2019 2019 2019 Net income $ 39,559 $ 26,047 $ 47,789 $ 62,108 $ 59,780 Plus: Intangible amortization, net of tax 104 104 112 846 85 (Numerator) $ 39,663 $ 26,151 $ 47,901 $ 62,954 $ 59,865 Average shareholders' equity $ 2,309,133 $ 2,337,016 $ 2,341,397 $ 2,315,585 $ 2,301,258 Less: Average goodwill and intangible assets (535,103) (535,235) (534,190) (535,184) (535,301) Average tangible shareholders' equity (denominator) $ 1,774,030 $ 1,801,781 $ 1,807,207 $ 1,780,401 $ 1,765,957 Return on average shareholders' equity (tangible), annualized 8.99 % 5.84 % 10.52 % 14.03 % 13.60 % 14

 
NON-GAAP RECONCILIATION Three months ended Jun 30 Mar 31 Dec 31 Sep 30 Jun 30 2020 2020 2019 2019 2019 Asset Quality, excluding PPP Non-performing loans (numerator) $ 139,804 $ 139,938 $ 141,155 $ 135,976 $ 147,716 Loans, net of unearned income $ 18,704,722 $ 17,077,403 $ 16,837,526 $ 16,686,866 $ 16,368,458 Less: PPP loans (1,937,034) — — — — Total adjusted loans (denominator) $ 16,767,688 $ 16,767,688 $ 16,767,688 $ 16,767,688 $ 16,767,688 Non-performing loans to adjusted total loans 0.83 % 0.83 % 0.84 % 0.81 % 0.88 % ACL - loans (numerator) $ 256,537 $ 238,508 $ 163,622 $ 166,135 $ 170,233 Loans, net of unearned income $ 18,704,722 $ 17,077,403 $ 16,837,526 $ 16,686,866 $ 16,368,458 Less: PPP loans (1,937,034) — — — — Total adjusted loans (denominator) $ 16,767,688 $ 17,077,403 $ 16,837,526 $ 16,686,866 $ 16,368,458 ACL - loans to adjusted total loans 1.53 % 1.40 % 0.97 % 1.00 % 1.04 % 15

 
NON-GAAP RECONCILIATION Three months ended Jun 30 Mar 31 Jun 30 Efficiency ratio 2020 2020 2019 Non-interest expense $ 143,006 $ 142,552 $ 144,168 Less: Prepayment penalty of FHLB advances (2,878) — — Less: Amortization of tax credit investments (1,450) (1,450) (1,492) Less: Intangible amortization (132) (132) (107) Non-interest expense (numerator) 138,546 140,970 142,569 Net interest income (fully taxable equivalent) $ 155,854 $ 163,970 $ 167,794 Plus: Total Non-interest income 55,922 54,644 54,316 Less: Investment securities gains, net (3,005) (46) (176) Net interest income (denominator) $ 208,771 $ 218,568 $ 221,934 Efficiency ratio 66.4 % 64.5 % 64.2 % 16