onb-20210119
Old National Bancorp /IN/0000707179FALSE00007071792021-01-192021-01-19



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 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): January 19, 2021
_________________________________________________________

OLD NATIONAL BANCORP
(Exact name of Registrant as specified in its charter)
_________________________________________________________
INDIANA
001-1581735-1539838
(State or other jurisdiction of incorporation)
(Commission File Number)
(IRS Employer Identification No.)

One Main Street
Evansville, Indiana47708
(Address of Principal Executive Offices)
 (Zip Code)
Registrant’s telephone number, including area code: (800) 731-2265
________________________________________________________
(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:

☐    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 class
Trading
Symbol(s)
Name of each exchange on which registered
Common Stock, No Par ValueONBThe 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 (s230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (s240.12b-2 of this chapter).
Emerging growth company    ☐

If an emerging growth company, indicate by check mark if the Registrant has elected not to use 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 January 19, 2021, Old National Bancorp (the “Company”) issued a press release (“Press Release”) reporting its financial results for the fourth quarter and full year 2020. The Press Release is furnished as Exhibit 99.1 hereto and is incorporated herein by reference. A slide presentation outlining fourth quarter and full year 2020 earnings, strategic developments, and the Company’s financial outlook will be available on the “Investor Relations” section of the Company’s website to complement the conference call to be held on January 19, 2021, at 9:00 a.m. CDT and will be accessible at http://www.oldnational.com immediately before the conference call begins.

Forward-Looking Statements

In this report, we have made various statements regarding current expectations or forecasts of future events, which speak only as of the date the statements are made. These statements are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are also made from time-to-time in press releases and in oral statements made by the officers of the Company. Forward-looking statements can be identified by the use of the words “expect,” “may,” “could,” “intend,” “project,” “estimate,” “believe,” “anticipate,” and other words of similar meaning. Such forward-looking statements are based on assumptions and estimates, which although believed to be reasonable, may turn out to be incorrect, such as statements about the potential impacts of the COVID-19 pandemic. Therefore, undue reliance should not be placed upon these estimates and statements. We cannot assure that any of these statements, estimates, or beliefs will be realized and actual results may differ from those contemplated in these “forward-looking statements.” We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events, or otherwise. You are advised to consult further disclosures we may make on related subjects in our filings with the SEC.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.    Description

99.1         Press Release issued by Old National Bancorp on January 19, 2021

104         Cover Page Interactive Data File (embedded within the Inline XBRL document).
2



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: January 19, 2021

OLD NATIONAL BANCORP

By: /s/ Brendon B. Falconer
Brendon B. Falconer
Senior Executive Vice President and
Chief Financial Officer


3


Exhibit 99.1
Old National Bancorp
capture1a.jpg
One Main Street
Evansville, IN 47708Media: Kathy A. Schoettlin (812) 465-7269
oldnational.comInvestors: Lynell J. Walton (812) 464-1366

Old National reports 4th quarter earnings of $74.1 million,
or $0.44 per share

Evansville, Ind. (January 19, 2021)
Old National Bancorp (NASDAQ: ONB) reports 4Q20 net income of $74.1 million, diluted EPS of $0.44.
Adjusted1 net income of $76.6 million, or $0.46 per diluted share.
Full-Year 2020 net income of $226.4 million, or $1.36 per diluted share.
Adjusted1 Full-Year net income of $250.3 million, or $1.50 per diluted share.
CEO COMMENTARY:
"Our 4th quarter success capped a very strong year of earnings as our team members worked with passion and resiliency to serve our clients," said Chairman and CEO Jim Ryan. "Another significant factor was the successful implementation of our ONB Way growth strategy in 2020, which enabled us to effectively and efficiently serve all client segments with streamlined processes and enhanced technology. This led to a phenomenal year of commercial loan production and outstanding performance."
FOURTH QUARTER HIGHLIGHTS2:
Net income
•Net income of $74.1 million
•Earnings per diluted share of $0.44
Net interest income/NIM
•Net interest income on a fully taxable equivalent basis of $164.6 million compared to $149.0 million
•Net interest margin on a fully taxable equivalent basis of 3.26% compared to 3.03%
Operating Performance
•Pre-provision net revenue1 (“PPNR”) of $80.8 million
•Adjusted PPNR1 of $94.0 million, up 27.2% over fourth quarter of 2019
•Noninterest expense of $142.3 million
•Adjusted noninterest expense1 of $128.8 million
•Efficiency ratio1 of 62.37%
•Adjusted efficiency ratio1 of 56.35%

Loans and Credit Quality
•End-of-period total loans3 of $13,849.7 million compared to $13,977.6 million
◦Total commercial loans increased $473.1 million, excluding the $536.2 million decline in PPP loans
•Fourth-quarter total commercial production of $1,197.1 million
•Provision for credit losses was a recapture of $1.1 million
•December 31 pipeline of $2.1 billion
•Net recoveries of $1.1 million compared to net recoveries of $3.0 million
•Non-performing loans of 1.20% of total loans compared to 1.15%
Return Profile & Capital
•Return on average common equity of 10.11%
•Return on average tangible common equity1 of 16.57%
•Adjusted return on average tangible common equity1 of 17.08%
•No shares of common stock were repurchased during the current quarter
Notable Items
•$3.6 million in ONB Way charges
•$9.9 million in tax credit amortization

1 Non-GAAP financial measure that Management believes is useful in evaluating the financial results of the Company – please refer to the Non GAAP reconciliations contained in this release 2 Comparisons are on a linked-quarter basis, unless otherwise noted 3 Includes loans held for sale



RESULTS OF OPERATIONS

Old National Bancorp reported fourth quarter 2020 net income of $74.1 million, or $0.44 per diluted share.

Included in the fourth quarter were pre-tax charges of $3.6 million for the ONB Way. Excluding these charges from the current quarter and netting out debt securities gains, adjusted net income was $76.6 million, or $0.46 per diluted share.

LOANS
Strong commercial production continued; PPP loan forgiveness accelerated.

•Period-end total loans were $13,849.7 million at December 31, 2020, a decrease of $127.9 million, or 3.7% annualized, when compared to the $13,977.6 million at September 30, 2020.
•Excluding the $536.2 million decline in PPP loans during the quarter, total loans increased $408.3 million, or 13.1% annualized.
•Excluding PPP loans, commercial and industrial loans increased $228.1 million, or 32.8% annualized.
•Commercial real estate loans increased $245.0 million to $5,946.5 million, or 17.2% annualized growth.
•Total commercial loan production in the fourth quarter was $1,197.1 million; period-end pipeline totaled $2.1 billion.
•Consumer loans decreased $26.0 million to $1,635.1 million and residential mortgage loans decreased $16.9 million to $2,248.4 million.
•Average total loans in the fourth quarter were $13,927.7 million, an increase of $78.8 million from the third quarter of 2020.
•Excluding PPP loans, average total loans in the fourth quarter increased $333.9 million from the third quarter of 2020.

DEPOSITS
A low-cost core deposit franchise continues to be one of Old National’s strengths.

•Period-end total deposits were $17,037.5 million at December 31, 2020, an increase of $531.0 million, or 12.9% annualized, when compared to the $16,506.5 million at September 30, 2020.
•Interest-bearing checking deposits increased $288.6 million to $4,877.0 million at December 31, 2020.
•Noninterest-bearing deposits increased $170.7 million to $5,633.7 million at December 31, 2020 from $5,463.0 million at September 30, 2020.
•On average, total deposits in the fourth quarter were $16,810.6 million, compared to $16,436.8 million in the third quarter of 2020.

NET INTEREST INCOME AND MARGIN
Net interest income and margin benefit from accelerated PPP loan forgiveness; deposit and funding costs continue to decline.

•Net interest income increased to $161.1 million in the fourth quarter of 2020.
•The net interest margin on a fully taxable equivalent basis increased 23 basis points to 3.26% compared to 3.03% in the third quarter of 2020.
•PPP interest and net fees combined were $22.6 million, or 26 basis points of net interest margin, in the fourth quarter of 2020 compared to $8.8 million, or a 5 basis points reduction to the net interest margin, in the third quarter of 2020.
•Accretion income was $5.4 million, or 10 basis points of net interest margin, in the fourth quarter of 2020 compared to $5.4 million, or 11 basis points of net interest margin, in the third quarter of 2020. In the fourth quarter of 2020, accretion income was 2.4% of adjusted total revenue.
•Interest collected on nonaccrual loans was $0.9 million, or 2 basis points of net interest margin, in the fourth quarter of 2020 compared to $1.0 million, or 2 basis point of net interest margin, in the third quarter of 2020.
•The cost of total deposits declined 4 basis points to 0.09% in the fourth quarter of 2020 while the cost of total interest-bearing deposits decreased 6 basis points to 0.13%.







CREDIT QUALITY
Strong credit quality remains a hallmark of the Old National franchise.
•Old National recorded a provision recapture in the fourth quarter of 2020 of $1.1 million, compared to no provision recorded in the third quarter.
•Net recoveries in the fourth quarter were $1.1 million, compared to net recoveries of $3.0 million in the third quarter.
•30-89 day delinquencies were 0.15% at the end of the fourth quarter.
•Non-performing loans increased as a percentage of total loans to 1.20%.
•Loans acquired from previous acquisitions were recorded at fair value at the acquisition date. As of December 31, 2020, the remaining discount on these acquired loans was $50.6 million.
•The allowance for credit losses remained unchanged at $131.4 million, or 0.95% of total loans at December 31, 2020.

NONINTEREST INCOME
Noninterest income decreased due to lower securities gains and a seasonal decline in mortgage banking revenue.

•Total noninterest income for the fourth quarter of 2020 was $58.5 million, a decrease of $6.2 million from the third quarter of 2020.
•Mortgage banking revenue decreased $1.9 million when compared to the third quarter of 2020.
•Gains on sales of debt securities decreased $4.8 million when compared to the third quarter of 2020.

NONINTEREST EXPENSE
Fourth quarter results demonstrate benefit of The ONB Way, helping drive positive operating leverage1.

•Noninterest expense for the fourth quarter of 2020 was $142.3 million and included $3.6 million in ONB Way charges and $9.9 million in tax credit amortization.
•Excluding these items, adjusted noninterest expense for the fourth quarter was $128.8 million, compared to the $114.2 million in adjusted noninterest expense in the third quarter of 2020.
•The fourth quarter of 2020 also included $8.1 million in additional incentive compensation which is included in adjusted noninterest expense defined above.
•The fourth quarter efficiency ratio was 62.37%, while the adjusted efficiency ratio was 56.35%.
•Adjusted operating leverage1 was +917 basis points for the fourth quarter of 2020 as compared to the fourth quarter of 2019.

INCOME TAXES

•On a fully taxable-equivalent basis, income tax expense in the fourth quarter was $7.8 million, resulting in a 9.5% FTE tax rate.
•Income tax expense included $13.6 million in tax credit benefit.

CAPITAL AND LIQUIDITY
Capital ratios remain strong.

•At the end of the fourth quarter, preliminary total risk-based capital was 12.69% and preliminary regulatory tier 1 capital was 11.75%.
•Tangible common equity to tangible assets was 8.64% at the end of the fourth quarter compared to 8.58% in the third quarter of 2020.
•The Company did not repurchase any shares of common stock during the fourth quarter.
•A low loan to deposit ratio of 81.3%, combined with existing funding sources plus available unencumbered, high-quality collateral, provides strong liquidity.








NON-GAAP RECONCILIATIONS
($ in millions, except EPS, shares in 000s)
4Q20
Adjustments4
Adjusted 4Q20
Total Revenues (FTE)$223.1 $(0.3)$222.8 
Less: Provision for Credit Losses1.1 — 1.1 
Less: Noninterest Expenses(142.3)3.6 (138.7)
Income before Income Taxes (FTE)$81.9 $3.3 $85.2 
Income Taxes(7.8)(0.8)(8.6)
Net Income$74.1 $2.5 $76.6 
Average Shares Outstanding165,631 — 165,631 
Earnings Per Share - Diluted$0.44 $0.02 $0.46 
4 Tax-effect calculations use the current statutory FTE tax rates (federal + state)

($ in millions, except EPS, shares in 000s)
2020
Adjustments4
Adjusted 2020
Total Revenues (FTE)$848.9 $(10.8)$838.1 
Less: Provision for Credit Losses(38.4)— (38.4)
Less: Noninterest Expenses(541.4)42.6 (498.8)
Income before Income Taxes (FTE)$269.1 $31.8 $300.9 
Income Taxes(42.7)(7.9)(50.6)
Net Income$226.4 $23.9 $250.3 
Average Shares Outstanding166,177 — 166,177 
Earnings Per Share - Diluted$1.36 $0.14 $1.50 
4 Tax-effect calculations use the current statutory FTE tax rates (federal + state)

($ in millions)
4Q20
3Q20
Net Interest Income$161.1 $145.6 
Add: FTE Adjustment3.5 3.4 
Net Interest Income (FTE)$164.6 $149.0 
Average Earning Assets$20,182.0 $19,654.3 
Net Interest Margin (FTE)3.26 %3.03 %
($ in millions)
4Q20
4Q19
Net Interest Income$161.1 $148.9 
Add: FTE Adjustment3.5 3.3 
Net Interest Income (FTE)$164.6 $152.2 
Add: Total Noninterest Income58.5 47.7 
Less: Noninterest Expense142.3 134.7 
Pre-Provision Net Revenue$80.8 $65.2 
Less: Debt Securities Gains(0.2)(0.4)
Less: Gain on Branch Actions(0.1)— 
Add: ONB Way Charges3.6 8.2 
Add: Merger and Integration Charges— 0.2 
Add: Amortization of Tax Credit Investments9.9 0.7 
Adjusted Pre-Provision Net Revenue$94.0 $73.9 



($ in millions)
4Q20
3Q20
4Q19
2020
2019
Noninterest Expense$142.3 $120.2 $134.7 $541.4 $508.5 
Less: ONB Way Charges(3.6)(2.9)(8.2)(42.6)(11.4)
Less: Merger and Integration Charges— — (0.2)— (6.0)
Noninterest Expense less Charges$138.7 $117.3 $126.3 $498.8 $491.1 
Less: Amortization of Tax Credit Investments(9.9)(3.1)(0.7)(18.8)(2.7)
Adjusted Noninterest Expense$128.8 $114.2 $125.6 $480.0 $488.4 
Less: Intangible Amortization(3.3)(3.4)(3.9)(14.1)(16.9)
Adjusted Noninterest Expense Less Intangible Amortization$125.5 $110.8 $121.7 $465.9 $471.5 
Net Interest Income$161.1 $145.6 $148.9 $596.1 $604.3 
FTE Adjustment3.5 3.4 3.3 13.6 12.9 
Net Interest Income (FTE)$164.6 $149.0 $152.2 $609.7 $617.2 
Total Noninterest Income58.5 64.7 47.7 239.2 199.3 
Total Revenue (FTE)$223.1 $213.7 $199.9 $848.9 $816.5 
Less: Debt Securities Gains/Losses(0.2)(4.9)(0.4)(10.8)(1.9)
Less: Gain on Branch Actions(0.1)— — — — 
Adjusted Total Revenue (FTE)$222.8 $208.8 $199.5 $838.1 $814.6 
Efficiency Ratio62.37 %55.93 %65.57 %62.91 %60.35 %
Adjusted Efficiency Ratio56.35 %53.06 %60.97 %55.59 %57.87 %
Operating Leverage5 (basis points)
598 (251)
Adjusted Operating Leverage6 (basis points)
917 460 
         5 Year-over-year basis point change in noninterest expenses plus change in total revenue
         6 Year-over-year basis point change in adjusted noninterest expense plus change in adjusted total revenue

($ in millions)
4Q20
3Q20
Net Income$74.1 $77.9 
Add: Intangible Amortization (net of tax7)
2.4 2.6 
Tangible Net Income$76.5 $80.5 
Less: Securities Gains/Losses (net of tax7)
(0.2)(3.7)
Add: Loss on Branch Actions (net of tax7)
(0.1)— 
Add: ONB Way Charges (net of tax7)
2.7 2.2 
Adjusted Tangible Net Income$78.9 $79.0 
Average Total Shareholders’ Equity2,932.6 2,889.5 
Less: Average Goodwill(1,037.0)(1,037.0)
Less: Average Intangibles(47.5)(50.9)
Average Tangible Shareholders’ Equity$1,848.1 $1,801.6 
Return on Average Tangible Common Equity16.57 %17.88 %
Adjusted Return on Average Tangible Common Equity17.08 %17.54 %
7Tax-effect calculations use the current statutory FTE tax rates (federal + state)

CONFERENCE CALL AND WEBCAST
Old National will host a conference call and live webcast at 9:00 a.m. Central Time on Tuesday, January 19, 2021, to review fourth-quarter 2020 financial results. The live audio web cast of the call, along with the corresponding presentation slides, will be available on the Company’s Investor Relations web page at oldnational.com and will be archived there for 12 months. A replay of the call will also be available from Noon Central Time on January 19 through February 2. To access the replay, dial 1-855-859-2056, Conference ID Code 6389837.








ABOUT OLD NATIONAL
Old National Bancorp (NASDAQ: ONB), the holding company of Old National Bank, is the largest bank holding company headquartered in Indiana. With $23.0 billion in assets, it ranks among the top 100 banking companies in the U.S. and has been recognized as a World’s Most Ethical Company by the Ethisphere Institute for nine consecutive years.  Since its founding in Evansville in 1834, Old National Bank has focused on community banking by building long-term, highly valued partnerships and keeping our clients at the center of all we do. This is an approach to business that we call The ONB Way. Today, Old National’s footprint includes Indiana, Kentucky, Michigan, Minnesota and Wisconsin. In addition to providing extensive services in retail and commercial banking, Old National offers comprehensive wealth management, investment and capital market services. For more information and financial data, please visit Investor Relations at oldnational.com.

USE OF NON-GAAP FINANCIAL MEASURES
This earnings release contains GAAP financial measures and non-GAAP financial measures where management believes it to be helpful in understanding Old National’s results of operations or financial position. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in the tables of this release.

FORWARD-LOOKING STATEMENT
This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  These statements include, but are not limited to, descriptions of Old National Bancorp’s (“Old National’s”) financial condition, results of operations, asset and credit quality trends and profitability.  Forward-looking statements can be identified by the use of the words “anticipate,” “believe,” “expect,” “intend,” “could” and “should,” and other words of similar meaning.  These forward-looking statements express management’s current expectations or forecasts of future events and, by their nature, are subject to risks and uncertainties, such as statements about the potential impacts of the COVID-19 pandemic. There are a number of factors that could cause actual results to differ materially from those in such statements.  Factors that might cause such a difference include, but are not limited to: the severity, magnitude and duration of the COVID-19 pandemic, including impacts of the pandemic and of businesses’ and governments’ responses to the pandemic on our operations and personnel, and on commercial activity and demand across our and our customers’ businesses; market, economic, operational, liquidity, credit and interest rate risks associated with Old National’s business (including developments and volatility arising from the COVID-19 pandemic); competition; heightened regulatory and governmental oversight and scrutiny of Old National's business practices; current, pending or future government legislation and policies (including the impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act and its related regulations); ability of Old National to execute its business plan, including the anticipated impact from the ONB Way strategic plan that may differ from current estimates; changes in the economy which could materially impact credit quality trends and the ability to generate loans and gather deposits; failure or circumvention of our internal controls; failure or disruption of our information systems; significant changes in accounting, tax or regulatory practices or requirements, including the impact of the CECL standard as well as changes to address the impact of COVID-19; new legal obligations or liabilities or unfavorable resolutions of litigations; disruptive technologies in payment systems and other services traditionally provided by banks; computer hacking and other cybersecurity threats; other matters discussed in this press release; and other factors identified in our Annual Report on Form 10-K and other periodic filings with the SEC.  These forward-looking statements are made only as of the date of this press release, and Old National does not undertake an obligation to release revisions to these forward-looking statements to reflect events or conditions after the date of this press release.


Financial Highlights (unaudited)
($ and shares in thousands, except per share data)
Three Months EndedTwelve Months Ended
December 31,September 30,December 31,December 31,December 31,
20202020201920202019
Income Statement
Net interest income$161,079 $145,573 $148,899 $596,094 $604,273 
Tax equivalent adjustment (1)3,517 3,379 3,282 13,586 12,940 
Net interest income - tax equivalent basis164,596 148,952 152,181 609,680 617,213 
Provision for loan losses (4)(1,100)— 1,264 38,395 4,747 
Noninterest income58,552 64,759 47,726 239,274 199,317 
Noninterest expense142,318 120,234 134,743 541,417 508,487 
Net income74,120 77,944 49,185 226,409 238,206 
Per Common Share Data
Weighted average diluted shares165,631 165,419 170,186 166,177 172,687 
Net income (diluted)$0.44 $0.47 $0.29 $1.36 $1.38 
Cash dividends0.14 0.14 0.13 0.56 0.52 
Common dividend payout ratio (2)31 %30 %45 %41 %37 %
Book value$17.98 $17.67 $16.82 $17.98 $16.82 
Stock price16.56 12.56 18.29 16.56 18.29 
Tangible common book value (3)11.43 11.10 10.35 11.43 10.35 
Performance Ratios
Return on average assets1.30 %1.40 %0.97 %1.04 %1.19 %
Return on average common equity10.11 %10.79 %6.94 %7.87 %8.57 %
Return on tangible common equity (3)16.20 %17.56 %11.89 %12.54 %14.30 %
Return on average tangible common equity (3)16.57 %17.88 %12.03 %13.27 %14.97 %
Net interest margin (FTE)3.26 %3.03 %3.46 %3.18 %3.55 %
Efficiency ratio (5)62.37 %55.93 %65.57 %62.91 %60.35 %
Net charge-offs (recoveries) to average loans(0.03)%(0.09)%0.12 %0.02 %0.05 %
Allowance for loan losses to ending loans (4)0.95 %0.95 %0.45 %0.95 %0.45 %
Non-performing loans to ending loans1.20 %1.15 %1.19 %1.20 %1.19 %
Balance Sheet (EOP)
Total loans$13,786,479$13,892,509$12,117,524$13,786,479$12,117,524
Total assets22,960,62222,460,47620,411,66722,960,62220,411,667
Total deposits17,037,45316,506,49414,553,39717,037,45314,553,397
Total borrowed funds2,676,5542,725,7312,744,7282,676,5542,744,728
Total shareholders' equity2,972,6562,921,1492,852,4532,972,6562,852,453
Capital Ratios (3)
Risk-based capital ratios (EOP):
    Tier 1 common equity11.75 %11.84 %12.13 %11.75 %12.13 %
    Tier 111.75 %11.84 %12.13 %11.75 %12.13 %
    Total12.69 %12.81 %12.99 %12.69 %12.99 %
Leverage ratio (to average assets)8.20 %8.15 %8.88 %8.20 %8.88 %
Total equity to assets (averages)12.83 %12.97 %14.01 %13.20 %13.88 %
Tangible common equity to tangible assets8.64 %8.58 %9.09 %8.64 %9.09 %
Nonfinancial Data
Full-time equivalent employees 2,4452,4842,7092,4452,709
Banking centers162162192162192
(1) Calculated using the federal statutory tax rate in effect of 21% for all periods.
(2) Cash dividends per share divided by net income per share (basic).
(3) Represents a non-GAAP financial measure. Refer the "Non-GAAP Measures" table for reconciliations to GAAP financial measures.
December 31, 2020 capital ratios are preliminary.
(4) Beginning January 1, 2020, calculation is based on current expected loss methodology. Prior to January 1, 2020, calculation was
based on incurred loss methodology.
(5) Efficiency ratio is defined as noninterest expense before amortization of intangibles as a percent of FTE net interest income and
      noninterest revenues, excluding net gains from debt securities transactions. This presentation excludes amortization of intangibles
      and net debt securities gains, as is common in other company releases, and better aligns with true operating performance.
FTE - Fully taxable equivalent basis EOP - End of period actual balances N/A - Not applicable



Income Statement (unaudited)
($ and shares in thousands, except per share data)
Three Months EndedTwelve Months Ended
December 31,September 30,December 31,December 31,December 31,
20202020201920202019
Interest income$173,249 $160,086 $176,553 $663,308 $730,387 
Less: interest expense12,170 14,513 27,654 67,214 126,114 
  Net interest income161,079 145,573 148,899 596,094 604,273 
Provision for loan losses (1)(1,100)— 1,264 38,395 4,747 
  Net interest income after provision for loan losses162,179 145,573 147,635 557,699 599,526 
Wealth management fees9,259 9,239 9,468 36,806 37,072 
Service charges on deposit accounts8,724 8,698 10,714 35,081 44,915 
Debit card and ATM fees5,072 5,276 5,360 20,178 21,652 
Mortgage banking revenue16,233 18,110 5,626 62,775 26,622 
Investment product fees5,544 5,351 5,679 21,614 21,785 
Capital markets income6,545 5,428 3,043 22,480 13,270 
Company-owned life insurance3,153 2,830 2,937 12,031 11,539 
Other income3,861 4,906 4,462 17,542 20,539 
Gains (losses) on sales of debt securities161 4,921 437 10,767 1,923 
  Total noninterest income58,552 64,759 47,726 239,274 199,317 
Salaries and employee benefits78,001 69,860 74,974 293,590 289,452 
Occupancy13,008 13,930 14,184 55,316 55,255 
Equipment3,778 3,754 3,958 16,690 16,903 
Marketing3,242 2,140 3,631 10,874 15,898 
Data processing 12,362 9,628 9,080 41,086 37,589 
Communication2,396 2,241 2,450 9,731 10,702 
Professional fees4,834 3,083 9,986 15,755 22,854 
FDIC assessment1,780 1,319 1,529 6,722 6,030 
Amortization of intangibles3,244 3,459 3,946 14,091 16,911 
Amortization of tax credit investments9,871 3,115 710 18,788 2,749 
Other expense9,802 7,705 10,295 58,774 34,144 
  Total noninterest expense142,318 120,234 134,743 541,417 508,487 
  Income before income taxes78,413 90,098 60,618 255,556 290,356 
  Income tax expense4,293 12,154 11,433 29,147 52,150 
   Net income$74,120 $77,944 $49,185 $226,409 $238,206 
Diluted Earnings Per Share
Net income$0.44 $0.47 $0.29 $1.36 $1.38 
Average Common Shares Outstanding
    Basic164,799164,773169,235165,509171,907
    Diluted165,631165,419170,186166,177172,687
Common shares outstanding at end of period165,367165,333169,616165,367169,616
(1) Beginning January 1, 2020, calculation is based on current expected loss methodology. Prior to January 1, 2020, calculation was
based on incurred loss methodology.


Balance Sheet (unaudited)
($ in thousands)
December 31,September 30,December 31,
202020202019
Assets
  Federal Reserve Bank account$307,967 $87,682 $29,141 
  Money market investments13,537 13,437 12,430 
  Investments:
    Treasury and government-sponsored agencies852,196 501,771 610,666 
    Mortgage-backed securities3,339,098 3,382,280 3,183,861 
    States and political subdivisions1,492,162 1,426,495 1,275,643 
    Other securities458,639 462,958 485,862 
      Total investments6,142,095 5,773,504 5,556,032 
  Loans held for sale, at fair value63,250 85,091 46,898 
  Loans:
    Commercial3,956,422 4,264,568 2,890,296 
    Commercial and agriculture real estate5,946,512 5,701,493 5,166,792 
    Consumer:
      Home equity556,414 549,115 559,021 
      Other consumer loans1,078,709 1,112,034 1,167,126 
    Subtotal of commercial and consumer loans11,538,057 11,627,210 9,783,235 
    Residential real estate2,248,422 2,265,299 2,334,289 
      Total loans13,786,479 13,892,509 12,117,524 
        Total earning assets20,313,328 19,852,223 17,762,025 
Allowance for loan losses (1)(131,388)(131,388)(54,619)
Non-earning Assets:
    Cash and due from banks268,208 229,631 234,766 
    Premises and equipment, net464,408 463,253 490,925 
    Operating lease right-of-use assets76,197 77,482 95,477 
    Goodwill and other intangible assets1,083,008 1,086,252 1,097,099 
    Company-owned life insurance456,110 455,975 448,967 
    Other assets 430,751 427,048 337,027 
      Total non-earning assets2,778,682 2,739,641 2,704,261 
        Total assets$22,960,622 $22,460,476 $20,411,667 
Liabilities and Equity
  Noninterest-bearing demand deposits$5,633,672 $5,463,007 $4,042,286 
  Interest-bearing:
    Checking and NOW accounts4,877,046 4,588,432 4,149,639 
    Savings accounts3,395,747 3,287,302 2,845,423 
    Money market accounts1,908,118 1,904,404 1,833,819 
    Other time deposits1,103,313 1,206,658 1,589,988 
     Total core deposits16,917,896 16,449,803 14,461,155 
  Brokered deposits119,557 56,691 92,242 
     Total deposits17,037,453 16,506,494 14,553,397 
  Federal funds purchased and interbank borrowings1,166 1,259 350,414 
  Securities sold under agreements to repurchase431,166 399,141 327,782 
  Federal Home Loan Bank advances1,991,435 2,087,648 1,822,847 
  Other borrowings252,787 237,683 243,685 
     Total borrowed funds2,676,554 2,725,731 2,744,728 
Operating lease liabilities86,598 88,552 99,500 
Accrued expenses and other liabilities187,361 218,550 161,589 
     Total liabilities19,987,966 19,539,327 17,559,214 
Common stock, surplus, and retained earnings2,824,885 2,771,865 2,796,246 
Accumulated other comprehensive income (loss), net of tax147,771 149,284 56,207 
     Total shareholders' equity2,972,656 2,921,149 2,852,453 
       Total liabilities and shareholders' equity$22,960,622 $22,460,476 $20,411,667 
(1) Beginning January 1, 2020, calculation is based on current expected loss methodology. Prior to January 1, 2020,
calculation was based on incurred loss methodology.


Average Balance Sheet and Interest Rates (unaudited)
($ in thousands)
Three Months EndedThree Months EndedThree Months Ended
December 31, 2020September 30, 2020December 31, 2019
AverageIncome (1)/Yield/AverageIncome (1)/Yield/AverageIncome (1)/Yield/
Earning Assets:BalanceExpenseRateBalanceExpenseRateBalanceExpenseRate
  Money market and other interest-earning
      investments$413,782 $126 0.12 %$137,880 $59 0.17 %$87,835 $530 2.39 %
  Investments:
    Treasury and government-sponsored agencies648,314 2,937 1.81 %454,005 2,457 2.17 %546,266 3,547 2.60 %
    Mortgage-backed securities3,291,436 16,137 1.96 %3,342,284 17,478 2.09 %3,172,818 18,844 2.38 %
    States and political subdivisions1,437,890 12,008 3.34 %1,383,765 11,860 3.43 %1,211,850 11,133 3.67 %
    Other securities462,836 2,629 2.27 %487,405 2,922 2.40 %489,889 3,585 2.93 %
       Total investments5,840,476 33,711 2.31 %5,667,459 34,717 2.45 %5,420,823 37,109 2.74 %
  Loans: (2)
    Commercial4,132,831 46,468 4.40 %4,274,894 33,223 3.04 %2,891,641 31,925 4.32 %
    Commercial and agriculture real estate5,829,912 58,334 3.92 %5,546,486 55,891 3.94 %5,129,638 66,959 5.11 %
    Consumer:
      Home equity550,548 4,380 3.17 %551,380 4,336 3.13 %561,125 6,426 4.54 %
      Other consumer loans1,099,504 11,276 4.08 %1,120,681 11,635 4.13 %1,153,924 12,245 4.21 %
    Subtotal commercial and consumer loans11,612,795 120,458 4.13 %11,493,441 105,085 3.64 %9,736,328 117,555 4.79 %
    Residential real estate loans2,314,938 22,471 3.88 %2,355,512 23,604 4.01 %2,332,835 24,641 4.23 %
       Total loans13,927,733 142,929 4.04 %13,848,953 128,689 3.66 %12,069,163 142,196 4.64 %
      Total earning assets$20,181,991 $176,766 3.46 %$19,654,292 $163,465 3.29 %$17,577,821 $179,835 4.05 %
Less: Allowance for loan losses (3)(137,539)(132,447)(57,162)
Non-earning Assets:
Cash and due from banks$341,154 $346,343 $278,324 
Other assets2,479,253 2,405,517 2,419,792 
      Total assets$22,864,859 $22,273,705 $20,218,775 
Interest-Bearing Liabilities:
  Checking and NOW accounts$4,708,568 $629 0.05 %$4,607,427 $886 0.08 %$4,121,021 $3,812 0.37 %
  Savings accounts3,329,494 487 0.06 %3,232,375 634 0.08 %2,842,996 1,586 0.22 %
  Money market accounts1,932,594 445 0.09 %1,902,407 724 0.15 %1,839,258 3,558 0.77 %
  Other time deposits1,158,715 2,189 0.75 %1,253,058 2,852 0.91 %1,642,773 6,101 1.47 %
     Total interest-bearing core deposits11,129,371 3,750 0.13 %10,995,267 5,096 0.18 %10,446,048 15,057 0.57 %
  Brokered deposits37,176 26 0.28 %150,545 201 0.53 %109,504 637 2.31 %
     Total interest-bearing deposits11,166,547 3,776 0.13 %11,145,812 5,297 0.19 %10,555,552 15,694 0.59 %
  Federal funds purchased and interbank borrowings843 — 0.03 %18,347 12 0.25 %95,973 437 1.80 %
  Securities sold under agreements to repurchase438,272 125 0.11 %385,149 160 0.16 %337,786 469 0.55 %
 Federal Home Loan Bank advances2,089,519 5,953 1.13 %2,021,468 6,709 1.32 %1,843,357 8,359 1.80 %
 Other borrowings240,815 2,316 3.85 %237,811 2,335 3.93 %251,565 2,695 4.29 %
     Total borrowed funds2,769,449 8,394 1.21 %2,662,775 9,216 1.38 %2,528,681 11,960 1.88 %
     Total interest-bearing liabilities13,935,996 12,170 0.35 %13,808,587 14,513 0.42 %13,084,233 27,654 0.84 %
Noninterest-Bearing Liabilities and Shareholders' Equity
Demand deposits$5,644,017 $5,291,037 $4,047,308 
Other liabilities352,256 284,536 254,296 
Shareholders' equity2,932,590 2,889,545 2,832,938 
Total liabilities and shareholders' equity$22,864,859 $22,273,705 $20,218,775 
Net interest rate spread3.11 %2.87 %3.21 %
Net interest margin (FTE)3.26 %3.03 %3.46 %
FTE adjustment$3,517 $3,379 $3,282 
(1) Interest income is reflected on a fully taxable equivalent basis (FTE).
(2) Includes loans held for sale.
(3) Beginning January 1, 2020, calculation is based on current expected loss methodology. Prior to January 1, 2020, calculation was based on incurred loss methodology.


Average Balance Sheet and Interest Rates (unaudited)
($ in thousands)
Twelve Months EndedTwelve Months Ended
December 31, 2020December 31, 2019
AverageIncome (1)/Yield/AverageIncome (1)/Yield/
Earning Assets:BalanceExpenseRateBalanceExpenseRate
  Money market and other interest-earning
      investments$174,494 $568 0.33 %$67,069 $1,670 2.49 %
  Investments:
    Treasury and government-sponsored agencies547,054 12,124 2.22 %657,233 16,091 2.45 %
    Mortgage-backed securities3,246,520 70,611 2.17 %2,866,600 73,835 2.58 %
    States and political subdivisions1,347,490 47,034 3.49 %1,202,210 44,716 3.72 %
    Other securities485,430 11,990 2.47 %495,847 16,138 3.25 %
       Total investments$5,626,494 $141,759 2.52 %$5,221,890 $150,780 2.89 %
  Loans: (2)
    Commercial3,843,089 140,473 3.66 %3,023,421 141,215 4.67 %
    Commercial and agriculture real estate5,477,562 234,670 4.28 %5,044,623 275,853 5.47 %
    Consumer:
      Home equity553,570 18,561 3.35 %566,232 28,515 5.04 %
      Other consumer loans1,131,028 46,661 4.13 %1,180,898 48,681 4.12 %
    Subtotal commercial and consumer loans11,005,249 440,365 4.00 %9,815,174 494,264 5.04 %
    Residential real estate loans2,352,444 94,202 4.00 %2,281,047 96,613 4.24 %
       Total loans13,357,693 534,567 4.00 %12,096,221 590,877 4.88 %
      Total earning assets$19,158,681 $676,894 3.53 %$17,385,180 $743,327 4.28 %
Less: Allowance for loan losses (3)(115,321)(56,624)
Non-earning Assets:
Cash and due from banks$327,053 $251,857 
Other assets2,414,602 2,453,001 
      Total assets$21,785,015 $20,033,414 
Interest-Bearing Liabilities:
  Checking and NOW accounts$4,464,027 $5,449 0.12 %$3,902,765 $15,598 0.40 %
  Savings accounts3,113,435 3,156 0.10 %2,878,135 8,142 0.28 %
  Money market accounts1,866,196 4,585 0.25 %1,789,065 14,130 0.79 %
  Other time deposits1,337,269 14,013 1.05 %1,748,552 27,400 1.57 %
     Total interest-bearing core deposits10,780,927 27,203 0.25 %10,318,517 65,270 0.63 %
  Brokered deposits85,041 966 1.14 %173,439 4,094 2.36 %
     Total interest-bearing deposits10,865,968 28,169 0.26 %10,491,956 69,364 0.66 %
  Federal funds purchased and interbank borrowings138,257 1,296 0.94 %241,618 5,656 2.34 %
  Securities sold under agreements to repurchase375,961 854 0.23 %342,654 2,517 0.73 %
 Federal Home Loan Bank advances2,055,155 27,274 1.33 %1,775,987 37,452 2.11 %
 Other borrowings242,642 9,621 3.96 %251,194 11,125 4.43 %
     Total borrowed funds2,812,015 39,045 1.39 %2,611,453 56,750 2.17 %
     Total interest-bearing liabilities13,677,983 67,214 0.49 %13,103,409 126,114 0.96 %
Noninterest-Bearing Liabilities and Shareholders' Equity
Demand deposits$4,945,506 $3,887,470 
Other liabilities286,066 261,403 
Shareholders' equity2,875,460 2,781,132 
Total liabilities and shareholders' equity$21,785,015 $20,033,414 
Net interest rate spread3.04 %3.32 %
Net interest margin (FTE)3.18 %3.55 %
FTE adjustment$13,586 $12,940 
(1) Interest income is reflected on a fully taxable equivalent basis (FTE).
(2) Includes loans held for sale.
(3) Beginning January 1, 2020, calculation is based on current expected loss methodology. Prior to January 1, 2020, calculation was based on incurred
loss methodology.



Asset Quality (EOP) (unaudited)
($ in thousands)
Three Months EndedTwelve Months Ended
December 31,September 30,December 31,December 31,December 31,
20202020201920202019
Beginning allowance for loan losses$131,388 $128,394 $56,910 $54,619 $55,461 
Impact of adopting ASC 326 on 1/1/2020 (1)— — N/A41,347 N/A
  Provision for loan losses (1)(1,100)— 1,264 38,395 4,747 
     Gross charge-offs(707)(4,169)(6,304)(15,553)(14,789)
     Gross recoveries1,807 7,163 2,749 12,580 9,200 
  Net (charge-offs) recoveries1,100 2,994 (3,555)(2,973)(5,589)
Ending allowance for loan losses (1)$131,388 $131,388 $54,619 $131,388 $54,619 
Net charge-offs (recoveries) / average loans (2)(0.03)%(0.09)%0.12 %0.02 %0.05 %
Average loans outstanding (2)$13,910,145 $13,827,019 $12,058,109 $13,341,677 $12,087,429 
EOP loans outstanding (2)13,786,479 13,892,509 12,117,524 13,786,479 12,117,524 
Allowance for loan losses / EOP loans (1)(2)0.95 %0.95 %0.45 %0.95 %0.45 %
Underperforming Assets:
   Loans 90 Days and over (still accruing)$167 $90 $570 $167 $570 
   Non-performing loans:
      Nonaccrual loans (3)147,339 137,611 126,412 147,339 126,412 
      TDRs still accruing17,749 22,037 18,338 17,749 18,338 
         Total non-performing loans165,088 159,648 144,750 165,088 144,750 
   Foreclosed properties1,324 1,248 2,169 1,324 2,169 
Total underperforming assets$166,579 $160,986 $147,489 $166,579 $147,489 
Classified and Criticized Assets:
Nonaccrual loans (3)147,339 137,611 126,412 147,339 126,412 
Substandard accruing loans157,276 189,524 169,689 157,276 169,689 
Loans 90 days and over (still accruing)167 90 570 167 570 
Total classified loans - "problem loans"$304,782 $327,225 $296,671 $304,782 $296,671 
Other classified assets3,706 3,860 2,933 3,706 2,933 
Criticized loans - "special mention loans"287,192 272,859 234,841 287,192 234,841 
Total classified and criticized assets$595,680 $603,944 $534,445 $595,680 $534,445 
Non-performing loans / EOP loans (2)1.20 %1.15 %1.19 %1.20 %1.19 %
Allowance to non-performing loans (1)(4)80 %82 %38 %80 %38 %
Under-performing assets / EOP loans (2)1.21 %1.16 %1.22 %1.21 %1.22 %
EOP total assets$22,960,622 $22,460,476 $20,411,667 $22,960,622 $20,411,667 
Under-performing assets / EOP assets0.73 %0.72 %0.72 %0.73 %0.72 %
EOP - End of period actual balances
 (1) Beginning January 1, 2020, calculation is based on current expected loss methodology. Prior to January 1, 2020, calculation was
based on incurred loss methodology.
(2) Excludes loans held for sale.
(3) Includes non-accruing TDRs totaling $14.9 million at December 31, 2020, $7.7 million at September 30, 2020, and $13.8 million at December 31,
2019.
(4) Includes acquired loans that were recorded at fair value in accordance with ASC 805 at the date of acquisition. As such, the credit risk
      was incorporated in the fair value recorded and no allowance for loan losses was recorded for 2019 quarter ends.



Non-GAAP Measures (unaudited)
($ in thousands)
Three Months EndedTwelve Months Ended
December 31,September 30,December 31,December 31,December 31,
20202020201920202019
Actual End of Period Balances
GAAP shareholders' equity $2,972,656 $2,921,149 $2,852,453 $2,972,656 $2,852,453 
Deduct:
Goodwill 1,036,994 1,036,994 1,036,994 1,036,994 1,036,994 
Intangibles 46,014 49,258 60,105 46,014 60,105 
1,083,008 1,086,252 1,097,099 1,083,008 1,097,099 
Tangible shareholders' equity $1,889,648 $1,834,897 $1,755,354 $1,889,648 $1,755,354 
Average Balances
GAAP shareholders' equity $2,932,590 $2,889,545 $2,832,938 $2,875,460 $2,781,132 
Deduct:
Goodwill 1,036,994 1,036,994 1,036,994 1,036,994 1,036,456 
Intangibles 47,536 50,926 61,963 52,740 68,244 
1,084,530 1,087,920 1,098,957 1,089,734 1,104,700 
Average tangible shareholders' equity $1,848,060 $1,801,625 $1,733,981 $1,785,726 $1,676,432 
Actual End of Period Balances
GAAP assets $22,960,622 $22,460,476 $20,411,667 $22,960,622 $20,411,667 
Add:
Trust overdrafts26 17 31 26 31 
Deduct:
Goodwill 1,036,994 1,036,994 1,036,994 1,036,994 1,036,994 
Intangibles 46,014 49,258 60,105 46,014 60,105 
1,083,008 1,086,252 1,097,099 1,083,008 1,097,099 
Tangible assets $21,877,640 $21,374,241 $19,314,599 $21,877,640 $19,314,599 
Risk-weighted assets (2)$15,369,076 $14,770,750 $14,073,929 $15,369,076 $14,073,929 
GAAP net income$74,120 $77,944 $49,185 $226,409 $238,206 
Add:
Amortization of intangibles (net of tax)2,433 2,595 2,976 10,585 12,756 
Tangible net income$76,553 $80,539 $52,161 $236,994 $250,962 
Tangible Ratios
Return on tangible common equity16.20 %17.56 %11.89 %12.54 %14.30 %
Return on average tangible common equity16.57 %17.88 %12.03 %13.27 %14.97 %
Return on tangible assets 1.40 %1.51 %1.08 %1.08 %1.30 %
Tangible common equity to tangible assets 8.64 %8.58 %9.09 %8.64 %9.09 %
Tangible common equity to risk-weighted assets (2)12.30 %12.42 %12.47 %12.30 %12.47 %
Tangible common book value (1)11.43 11.10 10.35 11.43 10.35 
Tangible common equity presentation includes other comprehensive income as is common in other company releases.
(1) Tangible common shareholders' equity divided by common shares issued and outstanding at period-end.
Tier 1 common equity (2)$1,805,194$1,748,150$1,706,727$1,805,194$1,706,727
Risk-weighted assets (2)15,369,076 14,770,750 14,073,929 15,369,076 14,073,929 
Tier 1 common equity to risk-weighted assets (2)11.75 %11.84 %12.13 %11.75 %12.13 %
(2) December 31, 2020 figures are preliminary.