Equibles

8-K

TRICO BANCSHARES / (TCBK)

8-K 2022-01-25 For: 2022-01-25
View Original
Added on April 04, 2026

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington D.C. 20549

_______________

FORM 8-K

_______________

Current report pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported):

January 25, 2022

_______________________

tcbk-20220125_g1.jpg

(Exact name of registrant as specified in its charter)

_______________________

California 0-10661 94-2792841
(State or other jurisdiction of<br>incorporation or organization) (Commission File No.) (I.R.S. Employer<br>Identification No.)
63 Constitution Drive Chico, California 95973
--- --- --- ---
(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (530) 898-0300

_______________________

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 class Trading<br>Symbol(s) Name of each exchange<br>on which registered
Common Stock, no par value TCBK Nasdaq

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

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02    Results of Operations and Financial Condition

On January 25, 2022, TriCo Bancshares (the "Company") announced its unaudited financial results for the three and twelve month periods ended December 31, 2021. A copy of the press release is attached as Exhibit 99.1 to this to this Form 8-K and is incorporated herein by reference.

Item 7.01    Regulation FD Disclosure

The executive officers of the Company intend to use the materials filed herewith, in whole or in part, in one or more presentations, discussions or meetings with investors. A copy of the investor presentation is attached hereto as Exhibit 99.2.

Item 9.01    Financial Statements and Exhibits

(d) Exhibits

99.1    Press release dated January 25, 2022

99.2     Investor Presentation

The information furnished under Item 2.02, Item 7.01 and Item 9.01 of this Current Period on Form 8-K, including the exhibit, shall not be deemed “filed” for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, or otherwise subject to the liabilities under that Section, nor shall it be deemed incorporated by reference in any registration statement or other filings of TriCo Bancshares under the Securities Act of 1933, as amended, except as shall be set forth by specific reference in such filing.

SIGNATURES

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 thereunto duly authorized.

TRICO BANCSHARES
Date: January 25, 2022 /s/ Peter G. Wiese
Peter G. Wiese, Executive Vice President and Chief Financial Officer
(Principal Financial and Accounting Officer)

Document

Exhibit 99.1

PRESS RELEASE Contact: Peter G. Wiese
For Immediate Release EVP & Chief Financial Officer (530) 898-0300

TRICO BANCSHARES ANNOUNCES ANNUAL AND QUARTERLY RESULTS

CHICO, CA – (January 25, 2022) – TriCo Bancshares (NASDAQ: TCBK) (the “Company”), parent company of Tri Counties Bank, today announced net income of $28,222,000 for the quarter ended December 31, 2021, compared to $27,422,000 during the trailing quarter ended September 30, 2021 and $23,657,000 during the quarter ended December 31, 2020. Diluted earnings per share were $0.94 for the fourth quarter of 2021, compared to $0.92 for the third quarter of 2021 and $0.79 for the fourth quarter of 2020.

Financial Highlights

Performance highlights and other developments for the Company as of or for the three and twelve months ended December 31, 2021 included the following:

•For the three and twelve months ended December 31, 2021, the Company’s return on average assets was 1.31% and 1.43%, respectively, and the return on average equity was 11.20% and 12.10%, respectively.

•Loan growth, excluding PPP, totaled $119.4 million (10.1% annualized) for the current quarter and $419.1 million (9.4% annualized) for the trailing twelve-month period.

•For the current quarter, net interest margin on a tax equivalent basis was 3.50%, which was consistent with the 3.50% in the trailing quarter and 3.79% for the quarter ended December 31, 2020.

•The efficiency ratio improved to 53.18% for the twelve months ended December 31, 2021, as compared to 58.40% for the same period of the prior year.

•As of December 31, 2021, the Company reported total loans, total assets and total deposits of $4.92 billion, $8.61 billion and $7.37 billion, respectively. As a direct result of significant deposit growth in the last year, the loan to deposit ratio has declined to 66.74% as of December 31, 2021, as compared to 73.21% at December 31, 2020.

•The average rate of interest paid on deposits, including non-interest-bearing deposits, equaled 0.04% during the fourth quarter of 2021, comparing favorably with 0.05% during the trailing quarter, and representing a decrease of 3 basis points from the average rate paid of 0.07% during the same quarter of the prior year.

•The balance of PPP loans outstanding at December 31, 2021 totaled $63.3 million and the balance of SBA fees remaining to be accreted totaled $2.2 million. Over 90% of all PPP loans originated have been forgiven and repaid by the SBA.

•Noninterest income related to service charges and fees was $11.3 million and $43.9 million for the three and twelve month periods ended December 31, 2021, an increase of 10.4% and 15.7% when compared to the same periods in 2020.

•The provision for credit losses for loans and debt securities was approximately $1.0 million during the quarter ended December 31, 2021, as compared to a reversal of provision expense of $1.4 million during the trailing quarter ended September 30, 2021, and a provision expense totaling $4.9 million for the three month period ended December 31, 2020.

•The allowance for credit losses to total loans was 1.74% as of December 31, 2021, compared to 1.72% as of the trailing quarter end, and 1.93% as of December 31, 2020. Non-performing assets to total assets were 0.38% at December 31, 2021, as compared to 0.37% as of September 30, 2021, and 0.39% at December 31, 2020.

“Fourth Quarter operating results remained strong as net loan growth, excluding PPP, exceeded 10 percent during the quarter. In addition, the performance of our Southern California commercial banking centers that opened in the Summer of 2021 are exceeding our internal forecasts”, commented Rick Smith, President and Chief Executive Officer. Smith added, “We also expect our acquisition of Valley Republic Bank to close in the first quarter of 2022. The Valley Team continues to build loan pipelines and their loan growth remains strong."

Peter Wiese, EVP and Chief Financial Officer also commented, “2021 represented the first year in our history where annual net income exceeded $100 million and total shareholders’ equity grew to over $1.0 billion. We thank our pandemic-weary Team for all of their hard work and efforts over the past year."

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Financial results reported in this document are preliminary. Final financial results and other disclosures will be reported in our Annual Report on Form 10-K for the period ended December 31, 2021, and may differ materially from the results and disclosures in this document due to, among other things, the completion of final review procedures, the occurrence of subsequent events, or the discovery of additional information.

Summary Results

For the three and twelve months ended December 31, 2021, the Company’s return on average assets was 1.31% and 1.43%, respectively, while the return on average equity was 11.20% and 12.10%, respectively. For the three and twelve months ended December 31, 2020, the Company’s return on average assets was 1.24% and 0.91%, respectively, while the return on average equity was 10.37% and 7.18%, respectively.

The following is a summary of the components of the Company’s operating results and performance ratios for the periods indicated:

Three months ended
December 31, September 30,
(dollars and shares in thousands) 2021 2021 Change % Change
Net interest income $ 69,783 $ 68,233 2.3 %
(Provision for) reversal of credit losses (980) 1,435 (2,415) (168.3) %
Noninterest income 16,502 15,095 1,407 9.3 %
Noninterest expense (46,679) (45,807) (872) 1.9 %
Provision for income taxes (10,404) (11,534) 1,130 (9.8) %
Net income $ 28,222 $ 27,422 2.9 %
Diluted earnings per share $ 0.94 $ 0.92 2.2 %
Dividends per share $ 0.25 $ 0.25 — %
Average common shares 29,724 29,714 10 — %
Average diluted common shares 29,870 29,851 19 0.1 %
Return on average total assets 1.31 % 1.30 %
Return on average equity 11.20 % 11.02 %
Efficiency ratio 54.10 % 54.97 %

All values are in US Dollars.

Three months ended<br>December 31,
(dollars and shares in thousands) 2021 2020 Change % Change
Net interest income $ 69,783 $ 66,422 5.1 %
Reversal of credit losses (980) (4,850) 3,870 (79.8) %
Noninterest income 16,502 16,580 (78) (0.5) %
Noninterest expense (46,679) (45,745) (934) 2.0 %
Provision for income taxes (10,404) (8,750) (1,654) 18.9 %
Net income $ 28,222 $ 23,657 19.3 %
Diluted earnings per share $ 0.94 $ 0.79 19.0 %
Dividends per share $ 0.25 $ 0.22 13.6 %
Average common shares 29,724 29,757 (33) (0.1) %
Average diluted common shares 29,870 29,863 7 — %
Return on average total assets 1.31 % 1.24 %
Return on average equity 11.20 % 10.37 %
Efficiency ratio 54.10 % 55.11 %

All values are in US Dollars.

Twelve months ended<br>December 31,
(dollars and shares in thousands) 2021 2020 Change % Change
Net interest income $ 271,539 $ 257,727 5.4 %
Reversal of (provision for) credit losses 6,775 (42,813) 49,588 (115.8) %
Noninterest income 63,664 55,194 8,470 15.3 %
Noninterest expense (178,275) (182,758) 4,483 (2.5) %
Provision for income taxes (46,048) (22,536) (23,512) 104.3 %
Net income $ 117,655 $ 64,814 81.5 %
Diluted earnings per share $ 3.94 $ 2.16 82.4 %
Dividends per share $ 1.00 $ 0.88 13.6 %
Average common shares 29,721 29,917 (196) (0.7) %
Average diluted common shares 29,882 30,028 (146) (0.5) %
Return on average total assets 1.43 % 0.91 %
Return on average equity 12.10 % 7.18 %
Efficiency ratio 53.18 % 58.40 %

All values are in US Dollars.

SBA Paycheck Protection Program

In March 2020 (Round 1) and subsequently in December 2020 (Round 2), the Small Business Administration ("SBA") Paycheck Protection Program ("PPP") was created to help small businesses keep workers employed during the COVID-19 crisis. Tri Counties Bank, through its online portal, facilitated the ability for borrowers to open a new deposit account and submit PPP applications during the entirety of the Programs. The SBA ended PPP and did not accept new borrowing applications, effective May 31, 2021.

The following is a summary of PPP loan related information as of the periods indicated:

(dollars in thousands) December 31, 2021 September 30, 2021 June 30, 2021 March 31, 2021 December 31, 2020
Total number of PPP loans outstanding 450 1,449 2,209 2,484 2,310
PPP loan balance (Round 1 origination), gross $ 2,544 $ 9,302 $ 51,547 $ 193,958 $ 333,982
PPP loan balance (Round 2 origination), gross 60,767 148,159 197,035 176,316 n/a
Total PPP loans, gross outstanding $ 63,311 $ 157,461 $ 248,582 $ 370,274 $ 333,982
PPP deferred loan fees (Round 1 origination) $ 1 $ 40 $ 477 $ 2,358 $ 7,212
PPP deferred loan fees (Round 2 origination) 2,163 5,973 8,513 7,072 n/a
Total PPP deferred loan fees outstanding $ 2,164 $ 6,013 $ 8,990 $ 9,430 $ 7,212

As of December 31, 2021, the total gross balance outstanding of PPP loans was $63,311,000 as compared to total PPP originations of $640,410,000. In connection with the origination of these loans, the Company earned approximately $25,299,000 in loan fees, offset by deferred loan costs of approximately $1,245,000, the net of which will be recognized over the earlier of loan maturity (between 24-60 months), repayment or receipt of forgiveness confirmation. As of December 31, 2021, there was approximately $2,164,000 in net deferred fee income remaining to be recognized. During the three and twelve months ended December 31, 2021, the Company recognized $3,842,000 and $14,148,000, respectively in fees on PPP loans as compared with $4,643,000 and $7,760,000 for the three and twelve months ended December 31, 2020, respectively.

COVID Deferrals

Following the passage of the CARES Act legislation, the "Interagency Statement on Loan Modifications and Reporting for Financial Institutions Working with Customers Affected by the Coronavirus" was issued by federal bank regulators, which offers temporary relief from troubled debt restructuring accounting for loan payment deferrals for certain customers whose businesses are experiencing economic hardship due to Coronavirus. The applicable period for this relief, originally expected to expire on December 31, 2020, was extended through 2021 by way of the Consolidated Appropriations Act.

The following is a summary of COVID related loan customer modifications with outstanding balances as of December 31, 2021:

Modification Type Deferral Term
(dollars in thousands) Modified Loan Balances Outstanding % of Total Category of Loans Interest Only Deferral Principal and Interest Deferral 90 Days 180 Days Other
Commercial real estate:
CRE non-owner occupied $ 18,437 1.2 % 100.0 % — % — % 79.5 % 20.5 %
CRE owner occupied — — — — — — —
Multifamily — — — — — — —
Farmland — — — — — — —
Total commercial real estate loans 18,437 0.6 — — — 79.5 20.5
Consumer loans — — — — — — —
Commercial and industrial — — — — — — —
Construction — — — — — — —
Agriculture production — — — — — — —
Leases — — — — — — —
Total modifications $ 18,437 0.4 % 100.0 % — % — % 79.5 % 20.5 %

The remaining balance outstanding as of December 31, 2021 are expected to conclude their modification period during the first half of 2022. The COVID deferral relief period under the CARES act legislation ended effective January 1, 2022, as such, any further requests for modification from borrowers will be evaluated in accordance with loan modification accounting guidance.

Balance Sheet

Total loans outstanding, excluding PPP, grew to $4.86 billion as of December 31, 2021, an increase of 9.4% over the prior year, and an annualized increase of 10.1% over the trailing quarter. Investments increased to $2.43 billion as of December 31, 2021, an increase of 16.3% annualized over the trailing quarter. Average earning assets to total average assets continued to increase to 93.0% at December 31, 2021, as compared to 92.9% and 92.4% at September 30, 2021, and December 31, 2020, respectively. The loan to deposit ratio was 66.7% at December 31, 2021, as compared to 67.5% and 73.2% at September 30, 2021, and December 31, 2020, respectively.

Total shareholders' equity increased by $18,170,000 during the quarter ended December 31, 2021, primarily as a result of net income of $28,222,000, offset by a decrease in accumulated other comprehensive income of $2,746,000, and $7,433,000 in cash dividends paid on common stock. As a result, the Company’s book value increased to $33.64 per share at December 31, 2021 as compared to $33.05 and $31.12 at September 30, 2021, and December 31, 2020, respectively. The Company’s tangible book value per share, a non-GAAP measure, calculated by subtracting goodwill and other intangible assets from total shareholders’ equity and dividing that sum by total shares outstanding, was $25.80 per share at December 31, 2021, as compared to $25.16 and $23.09 at September 30, 2021, and December 31, 2020, respectively.

Trailing Quarter Balance Sheet Change

Ending balances As of December 31, September 30, Change Annualized<br> % Change
(dollars in thousands) 2021 2021
Total assets $ 8,614,787 $ 8,458,030 7.4 %
Total loans 4,916,624 4,887,496 29,128 2.4 %
Total loans, excluding PPP 4,855,477 4,736,048 119,429 10.1 %
Total investments 2,427,885 2,333,015 94,870 16.3 %
Total deposits $ 7,367,159 $ 7,236,822 7.2 %

All values are in US Dollars.

Organic loan growth, excluding PPP, of $119,429,000 or 10.1% on an annualized basis was realized during the quarter ended December 31, 2021, primarily within commercial real estate. In addition, investment security growth was $94,870,000 or 16.3% on an annualized basis as excess liquidity, driven by continued strong deposit growth, was put to use in higher yielding earning assets. Deposit balances increased during the fourth quarter of 2021 by $130,337,000 or 7.2% annualized.

Average Trailing Quarter Balance Sheet Change

Qtrly avg balances for the period ended December 31, September 30, Change Annualized<br> % Change
(dollars in thousands) 2021 2021
Total assets $ 8,546,004 $ 8,348,111 9.5 %
Total loans 4,862,457 4,897,922 (35,465) (2.9) %
Total loans, excluding PPP 4,759,294 4,684,492 74,802 6.4 %
Total investments 2,402,582 2,149,311 253,271 47.1 %
Total deposits $ 7,304,659 $ 7,137,263 9.4 %

All values are in US Dollars.

The decrease in average total loans of $35,465,000, or 2.9% on an annualized basis, during the fourth quarter of 2021, was led by the quarter over quarter decline in net PPP loan balances outstanding totaling $90,301,000. As noted above, the significant growth in both ending and average balances of investment securities was a direct result of management's focus on the deployment of excess cash balances which remained elevated due to continued deposit growth during the quarter.

Year Over Year Balance Sheet Change

Ending balances As of December 31,
(dollars in thousands) 2021 2020 Change % Change
Total assets $ 8,614,787 $ 7,639,529 12.8 %
Total loans 4,916,624 4,763,127 153,497 3.2 %
Total loans, excluding PPP 4,855,477 4,436,357 419,120 9.4 %
Total investments 2,427,885 1,719,102 708,783 41.2 %
Total deposits $ 7,367,159 $ 6,505,934 13.2 %

All values are in US Dollars.

Net PPP loan balances outstanding have declined by $265,623,000 during the twelve months ended December 31, 2021, meanwhile, non-PPP loan balances (both organic and purchased) have increased by $419,120,000 during the same period. This has led to a beneficial and meaningful shift in the makeup of the loan portfolio, despite total loan balances increasing modestly during the year ended December 31, 2021, by $153,497,000 or 3.2%. The Company's non-PPP loan originations have increased significantly over the past year but have also been challenged by an acceleration in payoffs. Specifically, during the years ended December 31, 2021 and 2020, loan originations totaled approximately $1.46 billion and $0.79 billion, respectively; while payoffs of loans totaled $1.04 billion and $0.66 billion, respectively. Loan originations are inclusive of those related to the Company's recently opened Southern California loan production offices which contributed $34,742,000 and $38,828,000 during the three and twelve months ended December 31, 2021, respectively. Investment securities increased to $2,427,885,000 at December 31, 2021, a change of $708,783,000 or 41.2% from the prior year.

Net Interest Income and Net Interest Margin

The following is a summary of the components of net interest income for the periods indicated:

Three months ended
December 31, September 30,
(dollars in thousands) 2021 2021 Change % Change
Interest income $ 71,024 $ 69,628 2.0 %
Interest expense (1,241) (1,395) 154 (11.0) %
Fully tax-equivalent adjustment (FTE) (1) 274 265 9 3.4 %
Net interest income (FTE) $ 70,057 $ 68,498 2.3 %
Net interest margin (FTE) 3.50 % 3.50 %
Acquired loans discount accretion, net:
Amount (included in interest income) $ 1,780 $ 2,034
Net interest margin less effect of acquired loan discount accretion(1) 3.41 % 3.40 % 0.01 %
PPP loans yield, net:
Amount (included in interest income) $ 4,094 $ 3,507
Net interest margin less effect of PPP loan yield (1) 3.34 % 3.42 % (0.08) %
Acquired loans discount accretion and PPP loan yield, net:
Amount (included in interest income) $ 5,874 $ 5,541
Net interest margin less effect of acquired loan discount accretion and PPP loan yield (1) 3.25 % 3.31 % (0.06) %

All values are in US Dollars.

Three months ended<br>December 31,
(dollars in thousands) 2021 2020 Change % Change
Interest income $ 71,024 $ 68,081 4.3 %
Interest expense (1,241) (1,659) 418 (25.2) %
Fully tax-equivalent adjustment (FTE) (1) 274 258 16 6.2 %
Net interest income (FTE) $ 70,057 $ 66,680 5.1 %
Net interest margin (FTE) 3.50 % 3.79 %
Acquired loans discount accretion, net:
Amount (included in interest income) $ 1,780 $ 1,960
Net interest margin less effect of acquired loan discount accretion(1) 3.41 % 3.68 % (0.27) %
PPP loans yield, net:
Amount (included in interest income) $ 4,094 $ 5,676
Net interest margin less effect of PPP loan yield (1) 3.34 % 3.68 % (0.34) %
Acquired loans discount accretion and PPP loan yield, net:
Amount (included in interest income) $ 5,874 $ 7,636
Net interest margin less effect of acquired loan discount accretion and PPP loan yield (1) 3.25 % 3.57 % (0.32) %

All values are in US Dollars.

Twelve months ended<br>December 31,
(dollars in thousands) 2021 2020 Change % Change
Interest income $ 277,047 $ 267,184 3.7 %
Interest expense (5,508) (9,457) 3,949 (41.8) %
Fully tax-equivalent adjustment (FTE) (1) 1,071 1,069 2 0.2 %
Net interest income (FTE) $ 272,610 $ 258,796 5.3 %
Net interest margin (FTE) 3.58 % 3.96 %
Acquired loans discount accretion, net:
Amount (included in interest income) $ 8,091 $ 8,171
Net interest margin less effect of acquired loan discount accretion(1) 3.47 % 3.85 % (0.38) %
PPP loans yield, net:
Amount (included in interest income) $ 16,643 $ 10,635
Net interest margin less effect of PPP loan yield (1) 3.48 % 3.97 % (0.49) %
Acquired loans discount accretion and PPP loan yield, net:
Amount (included in interest income) $ 24,734 $ 18,806
Net interest margin less effect of acquired loans discount and PPP loan yield (1) 3.37 % 3.84 % (0.47) %

All values are in US Dollars.

(1)Certain information included herein is presented on a fully tax-equivalent (FTE) basis and / or to present additional financial details which may be desired by users of this financial information. The Company believes the use of these non-generally accepted accounting principles (non-GAAP) measures provide additional clarity in assessing its results, and the presentation of these measures are common practice within the banking industry. See additional information related to non-GAAP measures at the back of this document.

Loans may be acquired at a premium or discount to par value, in which case, the premium is amortized (subtracted from) or accreted (added to) interest income over the remaining life of the loan. Generally, as time goes on, the dollar impact of loan discount accretion and loan premium amortization decrease as the purchased loans mature or pay off early. Upon the early pay off of a loan, any remaining unaccreted discount or unamortized premium is immediately taken into interest income; and as loan payoffs may vary significantly from quarter to quarter, so may the impact of discount accretion and premium amortization on interest income. As a result of the increase in interest rates, the prepayment rate of portfolio loans, inclusive of those acquired at a premium or discount, declined during the fourth quarter of 2021. During the three months ended December 31, 2021, September 30, 2021, and December 31, 2020, purchased loan discount accretion was $1,780,000, $2,034,000, and $1,960,000, respectively.

The following table shows the components of net interest income and net interest margin on a fully tax-equivalent (FTE) basis for the quarterly periods indicated:

ANALYSIS OF CHANGE IN NET INTEREST MARGIN ON EARNING ASSETS

(unaudited, dollars in thousands)

Three months ended Three months ended Three months ended
December 31, 2021 September 30, 2021 December 31, 2020
Average<br>Balance Income/<br>Expense Yield/<br>Rate Average<br>Balance Income/<br>Expense Yield/<br>Rate Average<br>Balance Income/<br>Expense Yield/<br>Rate
Assets
Loans, excluding PPP $ 4,759,294 $ 56,710 4.73 % $ 4,684,492 $ 57,218 4.85 % $ 4,363,873 $ 55,339 5.04 %
PPP loans 103,163 4,094 15.74 % 213,430 3,507 6.52 % 403,842 5,676 5.59 %
Investments-taxable 2,261,161 9,028 1.58 % 2,019,283 7,741 1.52 % 1,458,856 6,022 1.64 %
Investments-nontaxable (1) 141,421 1,186 3.33 % 130,028 1,147 3.50 % 113,656 1,121 3.92 %
Total investments 2,402,582 10,214 1.69 % 2,149,311 8,888 1.64 % 1,572,512 7,143 1.81 %
Cash at Federal Reserve and other banks 682,759 280 0.16 % 710,936 280 0.16 % 658,355 181 0.11 %
Total earning assets 7,947,798 71,298 3.56 % 7,758,169 69,893 3.57 % 6,998,582 68,339 3.88 %
Other assets, net 598,206 589,942 572,370
Total assets $ 8,546,004 $ 8,348,111 $ 7,570,952
Liabilities and shareholders’ equity
Interest-bearing demand deposits $ 1,544,176 $ 58 0.01 % $ 1,507,697 $ 116 0.03 % $ 1,275,550 $ 43 0.01 %
Savings deposits 2,486,532 291 0.05 % 2,407,368 328 0.05 % 2,145,543 405 0.08 %
Time deposits 315,953 349 0.44 % 321,381 411 0.51 % 362,104 661 0.73 %
Total interest-bearing deposits 4,346,661 698 0.06 % 4,236,446 855 0.08 % 3,783,197 1,109 0.12 %
Other borrowings 50,667 7 0.05 % 48,330 6 0.05 % 32,504 4 0.05 %
Junior subordinated debt 58,004 536 3.67 % 57,891 534 3.66 % 57,581 546 3.77 %
Total interest-bearing liabilities 4,455,332 1,241 0.11 % 4,342,667 1,395 0.13 % 3,873,282 1,659 0.17 %
Noninterest-bearing deposits 2,957,998 2,900,817 2,557,978
Other liabilities 132,910 117,601 232,224
Shareholders’ equity 999,764 987,026 907,468
Total liabilities and shareholders’ equity $ 8,546,004 $ 8,348,111 $ 7,570,952
Net interest rate spread (1) (2) 3.45 % 3.45 % 3.71 %
Net interest income and margin (1) (3) $ 70,057 3.50 % $ 68,498 3.50 % $ 66,680 3.79 %

(1)Fully taxable equivalent (FTE). All yields and rates are calculated using specific day counts for the period and year as applicable.

(2)Net interest spread is the average yield earned on interest-earning assets minus the average rate paid on interest-bearing liabilities.

(3)Net interest margin is computed by calculating the difference between interest income and interest expense, divided by the average balance of interest-earning assets.

Net interest income (FTE) during the three months ended December 31, 2021 increased $1,559,000 or 2.3% to $70,057,000 compared to $68,498,000 during the three months ended September 30, 2021. Over the same period, net interest margin remained unchanged at 3.50%, as compared to the trailing quarter. This is attributed to an elevated yield earned from PPP loans during the quarter as a result of fee income accretion following Round 2 PPP loans being forgiven by the SBA and repaid, which was offset by a decline in yield of non-PPP loans totaling 12 basis points.

As compared to the same quarter in the prior year, average loan yields, excluding PPP, decreased 31 basis points from 5.04% during the three months ended December 31, 2020, to 4.73% during the three months ended December 31, 2021. The accretion of discounts from acquired loans added 15 and 17 basis points to loan yields during the quarters ended December 31, 2021 and December 31, 2020, respectively. Therefore, of the 31 basis point decrease in yields on loans during the comparable three month periods ended December 31, 2021 and 2020, 29 basis points was attributable to decreases in market rates, while 2 basis points resulted from less accretion of discounts. The index utilized in a significant portion of the Company’s variable rate loans, Wall Street Journal Prime, has remained unchanged at 3.25% since March 15, 2020, when it was reduced from 4.25%.

The rates paid on interest bearing liabilities generally remained flat during the quarter ended December 31, 2021 compared to the trailing quarter. The decline in interest expense when compared to the same quarter from the prior year, however, was primarily attributed to reductions in the rates offered on deposit products. As a result, the cost of interest-bearing deposits decreased by 6 basis points during the quarter ended December 31, 2021, to 0.06% from 0.12% during the same quarter of the prior year. In addition, the level of noninterest-bearing deposits continues to benefit the average cost of total deposits which decreased to 0.04% in the current quarter compared to 0.7% in the fourth quarter of the prior year. Specifically, the ratio of average total noninterest-bearing deposits to total average deposits was 40.5% and 40.6% as of December 31, 2021 and September 30, 2021, respectively, as compared to 40.3% in the quarter ended December 31, 2020.

ANALYSIS OF CHANGE IN NET INTEREST MARGIN ON EARNING ASSETS

(unaudited, dollars in thousands)

Twelve months ended December 31, 2021 Twelve months ended December 31, 2020
Average<br>Balance Income/<br>Expense Yield/<br>Rate Average<br>Balance Income/<br>Expense Yield/<br>Rate
Assets
Loans, excluding PPP $ 4,625,410 $ 225,626 4.88 % $ 4,361,679 $ 223,086 5.11 %
PPP loans 250,391 16,643 6.65 % 284,326 10,635 3.74 %
Investments-taxable 1,914,788 30,352 1.59 % 1,302,367 28,659 2.20 %
Investments-nontaxable (1) 160,863 4,639 2.88 % 116,717 4,636 3.97 %
Total investments 2,075,651 34,991 1.69 % 1,419,084 33,295 2.35 %
Cash at Federal Reserve and other banks 663,801 858 0.13 % 467,376 1,237 0.26 %
Total earning assets 7,615,253 278,118 3.65 % 6,532,465 268,253 4.11 %
Other assets, net 594,420 590,966
Total assets $ 8,209,673 $ 7,123,431
Liabilities and shareholders’ equity
Interest-bearing demand deposits $ 1,493,922 $ 327 0.02 % $ 1,313,804 $ 332 0.03 %
Savings deposits 2,360,605 1,256 0.05 % 2,015,134 2,595 0.13 %
Time deposits 324,636 1,735 0.53 % 397,216 3,958 1.00 %
Total interest-bearing deposits 4,179,163 3,318 0.08 % 3,726,154 6,885 0.18 %
Other borrowings 43,236 22 0.05 % 28,863 17 0.06 %
Junior subordinated debt 57,844 2,168 3.75 % 57,426 2,555 4.45 %
Total interest-bearing liabilities 4,280,243 5,508 0.13 % 3,812,443 9,457 0.25 %
Noninterest-bearing deposits 2,837,745 2,289,168
Other liabilities 119,471 119,710
Shareholders’ equity 972,214 902,110
Total liabilities and shareholders’ equity $ 8,209,673 $ 7,123,431
Net interest rate spread (1) (2) 3.52 % 3.86 %
Net interest income and margin (1) (3) $ 272,610 3.58 % $ 258,796 3.96 %

(1)Fully taxable equivalent (FTE). All yields and rates are calculated using specific day counts for the period and year as applicable.

(2)Net interest spread is the average yield earned on interest-earning assets minus the average rate paid on interest-bearing liabilities.

(3)Net interest margin is computed by calculating the difference between interest income and interest expense, divided by the average balance of interest-earning assets.

Interest Rates and Loan Portfolio Composition

During the quarter ended December 31, 2021, market interest rates, including many rates that serve as reference indices for variable rate loans, increased modestly. However, the loan portfolio yield continues to have a downward bias due to the repricing of loans at lower rates and increased market competition stemming from loan to deposit ratios at historic lows. As of December 31, 2021, the Company's loan portfolio consisted of approximately $4.9 billion in outstanding principal with a weighted average coupon rate of 4.28%, inclusive of the PPP program loans. Excluding PPP loans, the Company's loan portfolio has approximately $4.8 billion outstanding with a weighted average coupon rate of 4.32% as of December 31, 2021. Included in the December 31, 2021 loan total, exclusive of PPP loans, are variable rate loans totaling $3.0 billion of which 87.8% or $2.6 billion were at their floor rate. The remaining variable rate loans totaling $365.0 million, which carried a weighted average coupon rate of 4.76% as of December 31, 2021, are subject to further rate adjustment. If those remaining variable rate loans were to collectively, through future rate adjustments, be reduced to their respective floors, they would have a weighted average coupon rate of approximately 4.23% which would result in the reduction of the weighted average coupon rate of the total loan portfolio, exclusive of PPP loans, from 4.32% to approximately 4.29%.

As of December 31, 2020, the Company's loan portfolio consisted of approximately $4.80 billion in outstanding principal with a weighted average coupon rate of 4.35%, inclusive of the PPP program loans. Excluding PPP loans, the Company's loan portfolio has approximately $4.47 billion outstanding with a weighted average coupon rate of 4.60% as of December 31, 2020. Included in the December 31, 2020 loan total, exclusive of PPP loans, are variable rate loans totaling $3.02 billion of which 88.2% or $2.66 billion were at their floor rate. The remaining variable rate loans totaling $357.0 million, which carried a weighted average coupon rate of 5.03% as of December 31, 2020, are subject to further rate adjustment. If those remaining variable rate loans were to collectively, through future rate adjustments, be reduced to their respective floors, they would have a weighted average coupon rate of approximately 4.36% which would result in the reduction of the weighted average coupon rate of the total loan portfolio, exclusive of PPP loans, from 4.60% to approximately 4.55%.

Asset Quality and Credit Loss Provisioning

During the three months ended December 31, 2021, the Company recorded a provision for credit losses of $980,000, as compared to a reversal of provision for credit losses of $1,435,000 during the trailing quarter, and a provision expense of $4,850,000 during the last quarter of 2020.

The following table presents details of the provision for credit losses for the periods indicated:

Three months ended
(dollars in thousands) December 31, 2021 September 30, 2021 June 30, 2021 March 31, 2021 December 31, 2020
Addition to (reversal of) allowance for credit losses $ 715 $ (1,495) $ (145) $ (6,240) $ 4,450
Addition to (reversal of) reserve for unfunded loan commitments 265 60 (115) 180 400
Total provision for credit losses $ 980 $ (1,435) $ (260) $ (6,060) $ 4,850

The following table presents the activity in the allowance for credit losses on loans for the periods indicated:

Three months ended Twelve months ended
(dollars in thousands) December 31, 2021 December 31, 2020 December 31, 2021 December 31, 2020
Balance, beginning of period $ 84,306 $ 87,575 $ 91,847 $ 30,616
Impact from adoption of ASU 2016-13 — — — 18,913
Provision for (reversal of) credit losses 715 4,450 (7,165) 42,188
Loans charged-off (197) (560) (2,392) (1,755)
Recoveries of previously charged-off loans 552 382 3,086 1,885
Balance, end of period $ 85,376 $ 91,847 $ 85,376 $ 91,847

The allowance for credit losses (ACL) was $85,376,000 as of December 31, 2021, a net increase of $1,070,000 over the immediately preceding quarter. The provision of allowance for credit losses of $715,000 was necessary as net recoveries totaling $355,000 during the quarter were less than the required increases in quantitative and qualitative reserve components. More specifically, the qualitative reserves required under the cohort model increased required reserves by $857,000, while quantitative factors added approximately $213,000.

The Company utilizes a forecast period of approximately eight quarters and obtains the forecast data from publicly available sources as of the balance sheet date. This forecast data continues to evolve and included improving shifts in the magnitude of changes for both the unemployment and GDP factors leading up to the balance sheet date. However, management notes that the majority of economic forecasts utilized in the ACL calculation have remained directionally consistent with preceding quarters, as general economic conditions continue to improve, albeit at a pace slower than expected due to unforeseen disruptions in the supply chain and increasing energy prices. In addition, management notes that the level of governmental assistance provided through PPP as well as other programs during the last several quarters has been unprecedented. As a result, management continues to believe that certain credit weakness are likely present in the overall economy and that it is appropriate to maintain a reserve level that incorporates such risk factors.

Loans past due 30 days or more decreased by $6,207,000 during the quarter ended December 31, 2021 to $4,332,000, as compared to $10,539,000 at September 30, 2021. Non-performing loans were $30,350,000 at December 31, 2021, an increase of $1,560,000 and $3,486,000, respectively, from $28,790,000 and $26,864,000 as of September 30, 2021, and December 31, 2020, respectively.

The following table illustrates the total loans by risk rating and their respective percentage of total loans for the periods presented.

December 31, % of Total Loans September 30, % of Total Loans December 31, % of Total Loans
(dollars in thousands) 2021 2021 2020
Risk Rating:
Pass $ 4,787,077 97.4 % $ 4,698,475 96.1 % $ 4,555,154 95.6 %
Special Mention 77,461 1.5 % 138,699 2.9 % 158,241 3.4 %
Substandard 52,086 1.1 % 50,322 1.0 % 49,732 1.0 %
Total $ 4,916,624 $ 4,887,496 $ 4,763,127
Classified loans to total loans 1.06 % 1.03 % 1.04 %
Loans past due 30+ days to total loans 0.09 % 0.22 % 0.14 %

The Company's loan portfolio for non-classified loans (loans graded special mention or better) remains consistent for the quarter ended December 31, 2021, as compared to the trailing quarter September 30, 2021, representing 98.9% and 99.0% of total loans outstanding, respectively. Loans risk graded special mention decreased notably, by approximately $61,238,000 during the current quarter as compared to the trailing quarter, while loans risk graded substandard increased by $1,764,000 over the same period. The improvement in special mention risk graded loans was primarily attributed to a single relationship totaling approximately $56,200,000 being paid off during the quarter.

There was one addition to other real estate owned totaling $503,000 during the quarter ended December 31, 2021, and there was one sale for approximately $582,000, which generated a net gain of $22,000 for the quarter. As of December 31, 2021, other real estate owned consisted of six properties with a carrying value of approximately $2,594,000.

Allocation of Credit Loss Reserves by Loan Type

As of December 31, 2021 As of December 31, 2020
(dollars in thousands) Amount % of Loans Outstanding Amount % of Loans Outstanding
Commercial real estate:
CRE - Non Owner Occupied $ 25,739 1.61 % $ 29,380 1.91 %
CRE - Owner Occupied 10,691 1.51 % 10,861 1.74 %
Multifamily 12,395 1.51 % 11,472 1.79 %
Farmland 2,315 1.34 % 1,980 1.30 %
Total commercial real estate loans 51,140 1.55 % 53,693 1.82 %
Consumer:
SFR 1-4 1st Liens 10,723 1.60 % 10,117 1.83 %
SFR HELOCs and Junior Liens 10,510 3.11 % 11,771 3.59 %
Other 2,241 3.34 % 3,260 4.20 %
Total consumer loans 23,474 2.19 % 25,148 2.62 %
Commercial and Industrial 3,862 1.49 % 4,252 0.81 %
Construction 5,667 2.55 % 7,540 2.65 %
Agricultural Production 1,215 2.39 % 1,209 2.74 %
Leases 18 0.27 % 5 0.13 %
Allowance for credit losses 85,376 1.74 % 91,847 1.93 %
Reserve for unfunded loan commitments 3,790 3,400
Total allowance for credit losses $ 89,166 1.81 % $ 95,247 2.00 %

For the periods presented in the table above and for purposes of calculating the "% of Loans Outstanding", PPP loans are included in the segment "Commercial and Industrial." PPP loans are fully guaranteed and therefore would not require any loss reserve allocation. Excluding the net outstanding balances of PPP loans from the ratio of the ACL to total loans results in a reserve ratio of approximately 1.76% as of December 31, 2021. In addition to the allowance for credit losses above, the Company has acquired various performing loans whose fair value as of the acquisition date was determined to be less than the principal balance owed on those loans. This difference represents the collective discount of credit, interest rate and liquidity measurements which is expected to be amortized over the life of the loans. As of December 31, 2021, the unamortized discount associated with acquired loans totaled $16,107,000 and, if aggregated with the ACL, would collectively represent 2.06% of total gross loans and 2.09% of total loans less PPP loans.

Non-interest Income

The following table presents the key components of non-interest income for the current and trailing quarterly periods indicated:

Three months ended
(dollars in thousands) December 31, 2021 September 30, 2021 Change % Change
ATM and interchange fees $ 6,421 $ 6,516 (1.5) %
Service charges on deposit accounts 3,674 3,608 66 1.8 %
Other service fees 888 897 (9) (1.0) %
Mortgage banking service fees 475 476 (1) (0.2) %
Change in value of mortgage servicing rights (181) (232) 51 (22.0) %
Total service charges and fees 11,277 11,265 12 0.1 %
Increase in cash value of life insurance 713 644 69 10.7 %
Asset management and commission income 930 957 (27) (2.8) %
Gain on sale of loans 1,672 1,814 (142) (7.8) %
Lease brokerage income 204 183 21 11.5 %
Sale of customer checks 117 107 10 9.3 %
Gain on sale of investment securities — — — n/m
Loss on marketable equity securities (27) (14) (13) 92.9 %
Other 1,616 139 1,477 1,062.6 %
Total other non-interest income 5,225 3,830 1,395 36.4 %
Total non-interest income $ 16,502 $ 15,095 9.3 %

All values are in US Dollars.

Non-interest income increased $1,407,000 or 9.3% to $16,502,000 during the three months ended December 31, 2021, compared to $15,095,000 during the trailing quarter September 30, 2021. This was largely the result of death benefits totaling $702,000 being realized and an increase in the fair value of certain equity investments totaling approximately $804,000, both recorded within other non-interest income. As a partial offset, gain on sale of mortgage loans declined by $142,000 or 7.8% during the quarter ended December 31, 2021, as interest rates continued to trend higher, contributing to a decline in total mortgage origination and refinance activity.

The following table presents the key components of non-interest income for the current and prior year periods indicated:

Three months ended December 31,
(dollars in thousands) 2021 2020 Change % Change
ATM and interchange fees $ 6,421 $ 5,747 11.7 %
Service charges on deposit accounts 3,674 3,518 156 4.4 %
Other service fees 888 860 28 3.3 %
Mortgage banking service fees 475 469 6 1.3 %
Change in value of mortgage servicing rights (181) (376) 195 (51.9) %
Total service charges and fees 11,277 10,218 1,059 10.4 %
Increase in cash value of life insurance 713 746 (33) (4.4) %
Asset management and commission income 930 745 185 24.8 %
Gain on sale of loans 1,672 3,460 (1,788) (51.7) %
Lease brokerage income 204 173 31 17.9 %
Sale of customer checks 117 111 6 5.4 %
Gain on sale of investment securities — — — n/m
Loss on marketable equity securities (27) (8) (19) 237.5 %
Other 1,616 1,135 481 42.4 %
Total other non-interest income 5,225 6,362 (1,137) (17.9) %
Total non-interest income $ 16,502 $ 16,580 (0.5) %

All values are in US Dollars.

In addition to the discussion above within the non-interest income for the three months ended December 31, 2021, ATM and interchange fees improved $674,000 or 11.7% as a result of increased usage due to relaxed social distancing guidelines during the quarter December 31, 2021 when compared to the same period in the prior year. During the quarters ended December 31, 2021 and 2020, death benefits totaling $702,00 and $498,000, respectively, were realized.

The following table presents the key components of non-interest income for the current and prior year periods indicated:

Twelve months ended December 31,
(dollars in thousands) 2021 2020 Change % Change
ATM and interchange fees $ 25,356 $ 21,660 17.1 %
Service charges on deposit accounts 14,013 13,944 69 0.5 %
Other service fees 3,570 3,156 414 13.1 %
Mortgage banking service fees 1,881 1,855 26 1.4 %
Change in value of mortgage servicing rights (872) (2,634) 1,762 (66.9) %
Total service charges and fees 43,948 37,981 5,967 15.7 %
Increase in cash value of life insurance 2,775 2,949 (174) (5.9) %
Asset management and commission income 3,668 2,989 679 22.7 %
Gain on sale of loans 9,580 9,122 458 5.0 %
Lease brokerage income 746 668 78 11.7 %
Sale of customer checks 459 414 45 10.9 %
Gain on sale of investment securities — 7 (7) n/m
Gain (loss) on marketable equity securities (86) 64 (150) (234.4) %
Other 2,574 1,000 1,574 157.4 %
Total other non-interest income 19,716 17,213 2,503 14.5 %
Total non-interest income $ 63,664 $ 55,194 15.3 %

All values are in US Dollars.

Total non-interest income increased by $8,470,000 or 15.3% to $63,664,000 during the twelve months ended December 31, 2021, compared to $55,194,000 during the same period ended December 31, 2020. Generally, the changes in non-interest income for the year ended December 31, 2021 and 2020 are consistent with the changes already discussed. Additionally, during the year ended 2020, there was substantial downward pressure on interest rates following the COVID-19 pandemic, resulting in a decline in the fair value of mortgage servicing rights totaling $2,634,000 during the period.

Non-interest Expense

The following table presents the key components of non-interest expense for the current and trailing quarterly periods indicated:

Three months ended
(dollars in thousands) December 31, 2021 September 30, 2021 Change % Change
Base salaries, net of deferred loan origination costs $ 19,123 $ 17,673 8.2 %
Incentive compensation 3,932 3,123 809 25.9 %
Benefits and other compensation costs 4,611 5,478 (867) (15.8) %
Total salaries and benefits expense 27,666 26,274 1,392 5.3 %
Occupancy 3,713 3,771 (58) (1.5) %
Data processing and software 3,893 3,689 204 5.5 %
Equipment 1,298 1,336 (38) (2.8) %
Intangible amortization 1,193 1,409 (216) (15.3) %
Advertising 819 966 (147) (15.2) %
ATM and POS network charges 1,551 1,692 (141) (8.3) %
Professional fees 927 1,090 (163) (15.0) %
Telecommunications 534 574 (40) (7.0) %
Regulatory assessments and insurance 678 673 5 0.7 %
Merger and acquisition expenses 872 651 221 33.9 %
Postage 232 156 76 48.7 %
Operational losses 299 244 55 22.5 %
Courier service 346 286 60 21.0 %
Gain on sale or acquisition of foreclosed assets (23) (144) 121 (84.0) %
(Gain) loss on disposal of fixed assets 6 (19) 25 (131.6) %
Other miscellaneous expense 2,675 3,159 (484) (15.3) %
Total other non-interest expense 19,013 19,533 (520) (2.7) %
Total non-interest expense $ 46,679 $ 45,807 1.9 %
Average full-time equivalent staff 1,074 1,049 25 2.4 %

All values are in US Dollars.

Non-interest expense for the quarter ended December 31, 2021 increased $872,000 or 1.9% to $46,679,000 as compared to $45,807,000 during the trailing quarter ended September 30, 2021. Total salaries and benefits expense increased by $1,392,000 or 5.3%, led by wage related increases of $1,450,000 or 8.2% to $19,123,000. More specifically, the wage related change in the quarter was substantially due to growth in average full-time equivalent staff and additionally by transitory items caused by the COVID-19 pandemic, overtime and non-incentive stipends associated with special projects. Incentive compensation increased by $809,000 or 25.9%, while benefits and other compensation costs decreased by $867,000 or 15.8%, respectively, during the quarter ended December 31, 2021, both due to metrics that were impacted by the results of individual employee and Company-wide performance benchmarks for growth and profitability. Merger and acquisition expenses associated with the proposed merger with Valley Republic

Bancorp, which is pending regulatory approval, totaled $872,000 during the current quarter. In addition, during the three months ended December 31, 2021, and September 30, 2021 expenses totaling approximately $800,000 and $710,000, respectively are attributable to the Company's recently opened loan production offices, of which approximately $606,000 and $598,00, respectively relates to salaries and benefits.

The following table presents the key components of non-interest expense for the current and prior year quarterly periods indicated:

Three months ended December 31,
(dollars in thousands) 2021 2020 Change % Change
Base salaries, net of deferred loan origination costs $ 19,123 $ 16,510 15.8 %
Incentive compensation 3,932 2,342 1,590 67.9 %
Benefits and other compensation costs 4,611 9,621 (5,010) (52.1) %
Total salaries and benefits expense 27,666 28,473 (807) (2.8) %
Occupancy 3,713 3,815 (102) (2.7) %
Data processing and software 3,893 2,919 974 33.4 %
Equipment 1,298 1,293 5 0.4 %
Intangible amortization 1,193 1,430 (237) (16.6) %
Advertising 819 762 57 7.5 %
ATM and POS network charges 1,551 1,536 15 1.0 %
Professional fees 927 823 104 12.6 %
Telecommunications 534 618 (84) (13.6) %
Regulatory assessments and insurance 678 601 77 12.8 %
Merger and acquisition expenses 872 — 872 n/m
Postage 232 377 (145) (38.5) %
Operational losses 299 609 (310) (50.9) %
Courier service 346 401 (55) (13.7) %
Gain on sale or acquisition of foreclosed assets (23) (177) 154 (87.0) %
Loss on disposal of fixed assets 6 30 (24) (80.0) %
Other miscellaneous expense 2,675 2,235 440 19.7 %
Total other non-interest expense 19,013 17,272 1,741 10.1 %
Total non-interest expense $ 46,679 $ 45,745 2.0 %
Average full-time equivalent staff 1,074 1,030 44 4.3 %

All values are in US Dollars.

Non-interest expense increased by $934,000 or 2.0% to $46,679,000 during the three months ended December 31, 2021 as compared to $45,745,000 for the three months ended December 31, 2020. The change in total salaries and benefits expense was modest with a decrease of $807,000 or 2.8%, however, the individual components did experience significant volatility that was largely offset. The increases in salary and wage related matters of $2,613,000 or 15.8% and incentive compensation of $1,590,000 or 67.9% during the three months ended December 31, 2021 are attributed to the factors discussed above. The significant decline in benefits and compensation costs equaling $5,010,000 or 52.1% reflects a normalization of retirement obligations and insurance costs that were elevated during the comparative period during 2020. Other miscellaneous expenses increased by $440,000 or 19.7% during the quarter due to increasing volume of routine business related activities, such as credit appraisal fees and business travel.

The following table presents the key components of non-interest expense for the current and prior year periods indicated:

Twelve months ended December 31,
(dollars in thousands) 2021 2020 Change % Change
Base salaries, net of deferred loan origination costs $ 69,844 $ 70,164 (0.5) %
Incentive compensation 14,957 10,022 4,935 49.2 %
Benefits and other compensation costs 21,550 31,935 (10,385) (32.5) %
Total salaries and benefits expense 106,351 112,121 (5,770) (5.1) %
Occupancy 14,910 14,528 382 2.6 %
Data processing and software 13,985 13,504 481 3.6 %
Equipment 5,358 5,704 (346) (6.1) %
Intangible amortization 5,464 5,723 (259) (4.5) %
Advertising 2,899 2,827 72 2.5 %
ATM and POS network charges 6,040 5,433 607 11.2 %
Professional fees 3,657 3,222 435 13.5 %
Telecommunications 2,253 2,601 (348) (13.4) %
Regulatory assessments and insurance 2,581 1,594 987 61.9 %
Merger and acquisition expenses 1,523 — 1,523 n/m
Postage 710 1,068 (358) (33.5) %
Operational losses 964 1,168 (204) (17.5) %
Courier service 1,214 1,414 (200) (14.1) %
Gain on sale or acquisition of foreclosed assets (233) (234) 1 (0.4) %
(Gain) loss on disposal of fixed assets (439) 67 (506) (755.2) %
Other miscellaneous expense 11,038 12,018 (980) (8.2) %
Total other non-interest expense 71,924 70,637 1,287 1.8 %
Total non-interest expense $ 178,275 $ 182,758 (2.5) %
Average full-time equivalent staff 1,039 1,093 (54) (4.9) %

All values are in US Dollars.

The changes in non-interest expense for the twelve months ended December 31, 2021 and 2020 are generally consistent with the changes in the comparable three month periods discussed above. During the twelve months ended December 31, 2021, expenses totaling approximately $1,745,000 are attributable to the Company's recently opened loan production offices, of which approximately $1,430,000 relates to salaries and benefits. Regulatory assessment and insurance expense increased in the current year to date period primarily due to the expiration of credits during the 2020 year and to a lesser extent, the overall balance sheet growth of the bank. Additionally, the aforementioned merger agreement with Valley Republic Bancorp has contributed $1,523,000 in additional costs during the year ended 2021.

Provision for Income Taxes

The Company’s effective tax rate was 28.1% for the twelve months ended December 31, 2021, as compared to 25.8% for the year ended December 31, 2020. The reduced effective tax rate in the prior year was made possible through the provisions of the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) which provided the Company with an opportunity to file amended tax returns and generate proposed refunds of approximately $805,000. While the Company has initiated several tax strategies in anticipation of future tax rate increases, it is not anticipated that any will directly impact the Company's effective tax rate until such rate changes have been legislatively approved. Other differences between the Company's effective tax rate and applicable federal and state statutory rates are due to the proportion of non-taxable revenue and low income housing tax credits as compared to the levels of pre-tax earnings.

About TriCo Bancshares

Established in 1975, Tri Counties Bank is a wholly-owned subsidiary of TriCo Bancshares (NASDAQ: TCBK) headquartered in Chico, California, providing a unique brand of customer Service with Solutions available in traditional stand-alone and in-store bank branches in communities throughout Northern and Central California. Tri Counties Bank provides an extensive and competitive breadth of consumer, small business and commercial banking financial services, along with convenient around-the-clock ATMs, online and mobile banking access. Brokerage services are provided by Tri Counties Advisors through affiliation with Raymond James Financial Services, Inc. Visit www.TriCountiesBank.com to learn more.

Forward-Looking Statement

The statements contained herein that are not historical facts are forward-looking statements based on management’s current expectations and beliefs concerning future developments and their potential effects on the Company. Such statements involve inherent risks and uncertainties, many of which are difficult to predict and are generally beyond our control. There can be no assurance that future developments affecting us will be the same as those anticipated by management. We caution readers that a number of important factors could cause actual results to differ materially from those expressed in, or implied or projected by, such forward-looking statements. These risks and uncertainties include, but are not limited to, the following: the strength of the United States economy in general and the strength of the local economies in which we conduct operations; the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System; inflation, interest rate, market and monetary fluctuations on the Company's business condition and financial operating results; the impact of changes in financial services policies, laws and regulations; technological changes; weather, natural disasters and other catastrophic events that may or may not be caused by climate change and their effects on economic and business environments in which the Company operates; the continuing adverse impact on the U.S. economy, including the markets in which we operate due to the COVID-19 global pandemic, and the impact of a slowing U.S. economy and increased unemployment on the performance of our loan portfolio, the market value of our investment securities, the availability of sources of funding and the demand for our products; adverse developments with respect to U.S. or global economic conditions and other uncertainties, including the impact of supply chain disruptions, inflationary pressures and labor shortages on the economic recovery and our business; the costs or effects of mergers, acquisitions or dispositions we may make, whether we are able to obtain any required governmental approvals in connection with any such mergers, acquisitions or dispositions, and/or our ability to realize the contemplated financial business benefits associated with any such activities; the ability to execute our business plan in new lending markets; the future operating or financial performance of the Company, including our outlook for future growth and changes in the level of our nonperforming assets and charge-offs; the appropriateness of the allowance for credit losses, including the timing and effects of the implementation of the current expected credit losses model; any deterioration in values of California real estate, both residential and commercial; the effect of changes in accounting standards and practices; possible other-than-temporary impairment of securities held by us; changes in consumer spending, borrowing and savings habits; our ability to attract and maintain deposits and other sources of liquidity; changes in the financial performance and/or condition of our borrowers; our noninterest expense and the efficiency ratio; competition and innovation with respect to financial products and services by banks, financial institutions and non-traditional providers including retail businesses and technology companies; the challenges of integrating and retaining key employees; the costs and effects of litigation and of unexpected or adverse outcomes in such litigation; a failure in or breach of our operational or security systems or infrastructure, or those of our third-party vendors or other service providers, including as a result of cyber-attacks and the cost to defend against such attacks; change to U.S. tax policies, including our effective income tax rate; the effect of a fall in stock market prices on our brokerage and wealth management businesses; the discontinuation of the London Interbank Offered Rate and other reference rates; and our ability to manage the risks involved in the foregoing. Additional factors that could cause results to differ materially from those described above can be found in our Annual Report on Form 10-K for the year ended December 31, 2020, which has been filed with the Securities and Exchange Commission (the “SEC”) and are available in the “Investor Relations” section of our website, https://www.tcbk.com/investor-relations and in other documents we file with the SEC. Annualized, pro forma, projections and estimates are not forecasts and may not reflect actual results. We undertake no obligation (and expressly disclaim any such obligation) to update or alter our forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law.

TRICO BANCSHARES—CONDENSED CONSOLIDATED FINANCIAL DATA

(Unaudited. Dollars in thousands, except share data)

Three months ended
December 31,<br>2021 September 30,<br>2021 June 30,<br>2021 March 31,<br>2021 December 31,<br>2020
Revenue and Expense Data
Interest income $ 71,024 $ 69,628 $ 68,479 $ 67,916 $ 68,081
Interest expense 1,241 1,395 1,396 1,476 1,659
Net interest income 69,783 68,233 67,083 66,440 66,422
Provision for (benefit from) credit losses 980 (1,435) (260) (6,060) 4,850
Noninterest income:
Service charges and fees 11,277 11,265 10,930 10,476 10,218
Gain on sale of investment securities — — — — —
Other income 5,225 3,830 5,027 5,634 6,362
Total noninterest income 16,502 15,095 15,957 16,110 16,580
Noninterest expense:
Salaries and benefits 27,666 26,274 27,081 25,330 28,473
Occupancy and equipment 5,011 5,107 4,907 5,243 5,108
Data processing and network 5,444 5,381 4,752 4,448 4,455
Other noninterest expense 8,558 9,045 7,431 6,597 7,709
Total noninterest expense 46,679 45,807 44,171 41,618 45,745
Total income before taxes 38,626 38,956 39,129 46,992 32,407
Provision for income taxes 10,404 11,534 10,767 13,343 8,750
Net income $ 28,222 $ 27,422 $ 28,362 $ 33,649 $ 23,657
Share Data
Basic earnings per share $ 0.95 $ 0.92 $ 0.95 $ 1.13 $ 0.80
Diluted earnings per share $ 0.94 $ 0.92 $ 0.95 $ 1.13 $ 0.79
Dividends per share $ 0.25 $ 0.25 $ 0.25 $ 0.25 $ 0.22
Book value per common share $ 33.64 $ 33.05 $ 32.53 $ 31.71 $ 31.12
Tangible book value per common share (1) $ 25.80 $ 25.16 $ 24.60 $ 23.72 $ 23.09
Shares outstanding 29,730,424 29,714,609 29,716,294 29,727,122 29,727,214
Weighted average shares 29,723,791 29,713,558 29,718,603 29,727,182 29,756,831
Weighted average diluted shares 29,870,059 29,850,530 29,903,560 29,904,974 29,863,478
Credit Quality
Allowance for credit losses to gross loans 1.74 % 1.72 % 1.74 % 1.73 % 1.93 %
Loans past due 30 days or more $ 4,332 $ 10,539 $ 9,292 $ 10,550 $ 6,767
Total nonperforming loans $ 30,350 $ 28,790 $ 32,705 $ 28,941 $ 26,864
Total nonperforming assets $ 32,944 $ 31,440 $ 24,952 $ 31,250 $ 29,708
Loans charged-off $ 197 $ 1,582 $ 387 $ 226 $ 560
Loans recovered $ 552 $ 1,321 $ 653 $ 560 $ 382
Selected Financial Ratios
Return on average total assets 1.31 % 1.30 % 1.40 % 1.75 % 1.24 %
Return on average equity 11.20 % 11.02 % 11.85 % 14.51 % 10.37 %
Average yield on loans, excluding PPP 4.73 % 4.85 % 4.93 % 5.02 % 5.04 %
Average yield on interest-earning assets 3.56 % 3.57 % 3.65 % 3.82 % 3.88 %
Average rate on interest-bearing deposits 0.06 % 0.08 % 0.08 % 0.10 % 0.12 %
Average cost of total deposits 0.04 % 0.05 % 0.05 % 0.06 % 0.07 %
Average rate on borrowings & subordinated debt 1.98 % 2.02 % 2.31 % 2.42 % 2.43 %
Average rate on interest-bearing liabilities 0.11 % 0.13 % 0.13 % 0.15 % 0.17 %
Net interest margin (fully tax-equivalent) (1) 3.50 % 3.50 % 3.58 % 3.74 % 3.79 %
Loans to deposits 66.74 % 67.54 % 70.72 % 72.37 % 73.21 %
Efficiency ratio 54.10 % 54.97 % 53.19 % 50.42 % 55.11 %
Supplemental Loan Interest Income Data
Discount accretion on acquired loans $ 1,780 $ 2,034 $ 2,566 $ 1,712 $ 1,960
All other loan interest income (excluding PPP) (1) $ 54,930 $ 55,184 $ 54,559 $ 52,861 $ 53,379
Total loan interest income (excluding PPP) (1) $ 56,710 $ 57,218 $ 57,125 $ 54,573 $ 55,339

(1) Non-GAAP measure.

TRICO BANCSHARES—CONDENSED CONSOLIDATED FINANCIAL DATA

(Unaudited. Dollars in thousands)

Balance Sheet Data December 31,<br>2021 September 30,<br>2021 June 30,<br>2021 March 31,<br>2021 December 31,<br>2020
Cash and due from banks $ 768,421 $ 740,236 $ 639,740 $ 609,522 $ 669,551
Securities, available for sale, net 2,210,876 2,098,786 1,850,547 1,685,076 1,417,289
Securities, held to maturity, net 199,759 216,979 235,778 260,454 284,563
Restricted equity securities 17,250 17,250 17,250 17,250 17,250
Loans held for sale 3,466 3,072 5,723 3,995 6,268
Loans:
Commercial real estate 3,306,054 3,222,737 3,194,336 3,108,624 2,951,902
Consumer 1,071,551 1,053,653 1,050,609 1,041,213 952,108
Commercial and industrial 259,355 345,027 452,069 551,077 526,327
Construction 222,281 216,680 200,714 221,613 284,842
Agriculture production 50,811 44,410 41,967 39,753 44,164
Leases 6,572 4,989 5,199 4,697 3,784
Total loans, gross 4,916,624 4,887,496 4,944,894 4,966,977 4,763,127
Allowance for credit losses (85,376) (84,306) (86,062) (85,941) (91,847)
Total loans, net 4,831,248 4,803,190 4,858,832 4,881,036 4,671,280
Premises and equipment 78,687 78,968 79,178 82,338 83,731
Cash value of life insurance 117,857 120,932 120,287 119,543 118,870
Accrued interest receivable 19,292 18,425 18,923 19,442 20,004
Goodwill 220,872 220,872 220,872 220,872 220,872
Other intangible assets 12,369 13,562 14,971 16,402 17,833
Operating leases, right-of-use 25,665 26,815 26,365 27,540 27,846
Other assets 109,025 98,943 81,899 88,142 84,172
Total assets $ 8,614,787 $ 8,458,030 $ 8,170,365 $ 8,031,612 $ 7,639,529
Deposits:
Noninterest-bearing demand deposits $ 2,979,882 $ 2,943,016 $ 2,843,783 $ 2,766,510 $ 2,581,517
Interest-bearing demand deposits 1,568,682 1,519,426 1,486,321 1,465,915 1,414,908
Savings deposits 2,521,011 2,447,706 2,337,557 2,302,927 2,164,942
Time certificates 297,584 326,674 324,392 328,048 344,567
Total deposits 7,367,159 7,236,822 6,992,053 6,863,400 6,505,934
Accrued interest payable 928 1,056 1,026 970 1,362
Operating lease liability 26,280 27,290 26,707 27,780 27,973
Other liabilities 112,070 107,282 85,388 102,955 94,597
Other borrowings 50,087 45,601 40,559 36,226 26,914
Junior subordinated debt 58,079 57,965 57,852 57,742 57,635
Total liabilities 7,614,603 7,476,016 7,203,585 7,089,073 6,714,415
Common stock 532,244 531,339 531,038 531,367 530,835
Retained earnings 466,959 446,948 427,575 408,211 381,999
Accum. other comprehensive income (loss) 981 3,727 8,167 2,961 12,280
Total shareholders’ equity $ 1,000,184 $ 982,014 $ 966,780 $ 942,539 $ 925,114
Quarterly Average Balance Data
Average loans, excluding PPP $ 4,759,294 $ 4,684,492 $ 4,646,188 $ 4,407,150 $ 4,363,873
Average interest-earning assets $ 7,947,798 $ 7,758,169 $ 7,544,581 $ 7,239,726 $ 6,998,582
Average total assets $ 8,546,004 $ 8,348,111 $ 8,128,674 $ 7,808,912 $ 7,570,952
Average deposits $ 7,304,659 $ 7,137,263 $ 6,943,081 $ 6,653,754 $ 6,341,175
Average borrowings and subordinated debt $ 108,671 $ 106,221 $ 98,774 $ 90,397 $ 90,085
Average total equity $ 999,764 $ 987,026 $ 960,145 $ 940,775 $ 907,468
Capital Ratio Data
Total risk based capital ratio 15.4 % 15.4 % 15.3 % 15.1 % 15.2 %
Tier 1 capital ratio 14.2 % 14.2 % 14.1 % 13.9 % 14.0 %
Tier 1 common equity ratio 13.2 % 13.2 % 13.0 % 12.9 % 12.9 %
Tier 1 leverage ratio 9.9 % 9.9 % 9.9 % 10.0 % 9.9 %
Tangible capital ratio (1) 9.2 % 9.1 % 9.2 % 9.1 % 9.3 %

(1) Non-GAAP measure.

TRICO BANCSHARES—NON-GAAP FINANCIAL MEASURES

(Unaudited. Dollars in thousands)

In addition to results presented in accordance with generally accepted accounting principles in the United States of America (GAAP), this press release contains certain non-GAAP financial measures. Management has presented these non-GAAP financial measures in this press release because it believes that they provide useful and comparative information to assess trends in the Company's core operations reflected in the current quarter's results, and facilitate the comparison of our performance with the performance of our peers. However, these non-GAAP financial measures are supplemental and are not a substitute for any analysis based on GAAP. Where applicable, comparable earnings information using GAAP financial measures is also presented. Because not all companies use the same calculations, our presentation may not be comparable to other similarly titled measures as calculated by other companies. For a reconciliation of these non-GAAP financial measures, see the tables below:

Three months ended Twelve months ended
(dollars in thousands) December 31,<br>2021 September 30,<br>2021 December 31,<br>2020 December 31,<br>2021 December 31,<br>2020
Net interest margin
Acquired loans discount accretion, net:
Amount (included in interest income) $ 1,780 $ 2,034 $ 1,960 $ 8,091 $ 8,171
Effect on average loan yield 0.15 % 0.17 % 0.18 % 0.17 % 0.19 %
Effect on net interest margin (FTE) 0.09 % 0.10 % 0.11 % 0.11 % 0.13 %
Net interest margin (FTE) 3.50 % 3.50 % 3.79 % 3.58 % 3.96 %
Net interest margin less effect of acquired loan discount accretion (Non-GAAP) 3.41 % 3.40 % 3.68 % 3.47 % 3.85 %
PPP loans yield, net:
Amount (included in interest income) $ 4,094 $ 3,507 $ 5,676 $ 16,643 $ 10,635
Effect on net interest margin (FTE) 0.16 % 0.09 % 0.11 % 0.10 % (0.01) %
Net interest margin less effect of PPP loan yield (Non-GAAP) 3.34 % 3.41 % 3.68 % 3.48 % 3.97 %
Acquired loan discount accretion and PPP loan yield, net:
Amount (included in interest income) $ 5,874 $ 5,541 $ 7,636 $ 24,734 $ 18,806
Effect on net interest margin (FTE) 0.25 % 0.19 % 0.22 % 0.21 % 0.12 %
Net interest margin less effect of acquired loan discount accretion and PPP yields, net (Non-GAAP) 3.25 % 3.31 % 3.57 % 3.37 % 3.84 %
Three months ended Twelve months ended
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
(dollars in thousands) December 31,<br>2021 September 30,<br>2021 December 31,<br>2020 December 31,<br>2021 December 31,<br>2020
Pre-tax pre-provision return on average assets or equity
Net income (GAAP) $ 28,222 27,422 $ 23,657 $ 117,655 $ 64,814
Exclude income tax expense 10,404 11,534 8,750 46,048 22,536
Exclude provision (benefit) for credit losses 980 (1,435) 4,850 (6,775) 42,813
Net income before income tax and provision expense (Non-GAAP) $ 39,606 $ 37,521 $ 37,257 $ 156,928 $ 130,163
Average assets (GAAP) $ 8,546,004 $ 8,348,111 $ 7,570,952 $ 8,209,673 $ 7,123,431
Average equity (GAAP) 999,764 987,026 907,468 972,214 902,110
Return on average assets (GAAP) (annualized) 1.31 % 1.30 % 1.24 % 1.43 % 0.91 %
Pre-tax pre-provision return on average assets (Non-GAAP) (annualized) 1.84 % 1.78 % 1.96 % 1.91 % 1.83 %
Return on average equity (GAAP) (annualized) 11.20 % 11.02 % 10.37 % 12.10 % 7.18 %
Pre-tax pre-provision return on average equity (Non-GAAP) (annualized) 15.72 % 15.08 % 16.33 % 16.14 % 14.43 %
Three months ended Twelve months ended
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
(dollars in thousands) December 31,<br>2021 September 30,<br>2021 December 31,<br>2020 December 31,<br>2021 December 31,<br>2020
Return on tangible common equity
Average total shareholders' equity $ 999,764 $ 987,026 $ 907,468 $ 972,214 $ 902,110
Exclude average goodwill 220,872 220,872 220,872 220,872 220,872
Exclude average other intangibles 12,966 14,267 18,549 15,131 20,695
Average tangible common equity (Non-GAAP) $ 765,926 $ 751,887 $ 668,047 $ 736,211 $ 660,543
Net income (GAAP) $ 28,222 $ 27,422 $ 23,657 $ 117,655 $ 64,814
Exclude amortization of intangible assets, net of tax effect 840 992 1,007 3,849 4,031
Tangible net income available to common shareholders (Non-GAAP) $ 29,062 28,414 $ 24,664 $ 121,504 $ 68,845
Return on average equity 11.20 % 11.02 % 10.37 % 12.10 % 7.18 %
Return on average tangible common equity (Non-GAAP) 15.05 % 14.99 % 14.69 % 16.50 % 10.42 %
Three months ended
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
(dollars in thousands) December 31,<br>2021 September 30,<br>2021 June 30,<br>2021 March 31,<br>2021 December 31,<br>2020
Tangible common shareholders' equity to tangible assets
Shareholders' equity (GAAP) $ 1,000,184 $ 982,014 $ 966,780 $ 942,539 $ 925,114
Exclude goodwill and other intangible assets, net 233,241 234,434 235,843 237,274 238,705
Tangible shareholders' equity (Non-GAAP) $ 766,943 $ 747,580 $ 730,937 $ 705,265 $ 686,409
Total assets (GAAP) $ 8,614,787 $ 8,458,030 $ 8,170,365 $ 8,031,612 $ 7,639,529
Exclude goodwill and other intangible assets, net 233,241 234,434 235,843 237,274 238,705
Total tangible assets (Non-GAAP) $ 8,381,546 $ 8,223,596 $ 7,934,522 $ 7,794,338 $ 7,400,824
Common s/h equity to total assets (GAAP) 11.61 % 11.61 % 11.83 % 11.74 % 12.11 %
Tangible common shareholders' equity to tangible assets (Non-GAAP) 9.15 % 9.09 % 9.21 % 9.05 % 9.27 %
Three months ended
--- --- --- --- --- --- --- --- --- --- ---
(dollars in thousands) December 31,<br>2021 September 30,<br>2021 June 30,<br>2021 March 31,<br>2021 December 31,<br>2020
Tangible common shareholders' equity per share
Tangible s/h equity (Non-GAAP) $ 766,943 $ 747,580 $ 730,937 $ 705,265 $ 686,409
Tangible assets (Non-GAAP) 8,381,546 8,223,596 7,934,522 7,794,338 7,400,824
Common shares outstanding at end of period 29,730,424 29,714,609 29,716,294 29,727,122 29,727,214
Common s/h equity (book value) per share (GAAP) $ 33.64 $ 33.05 $ 32.53 $ 31.71 $ 31.12
Tangible common shareholders' equity (tangible book value) per share (Non-GAAP) $ 25.80 $ 25.16 $ 24.60 $ 23.72 $ 23.09

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18

a2021-q4investorpresenta

January 2022 Investor Presentation INVESTOR PRESENTATION Fourth Quarter 2021 Richard P. Smith – President & Chief Executive Officer John S. Fleshood – EVP & Chief Operating Officer Peter G. Wiese – EVP & Chief Financial Officer Exhibit 99.2

January 2022 Investor Presentation The statements contained herein that are not historical facts are forward-looking statements based on management’s current expectations and beliefs concerning future developments and their potential effects on the Company. Such statements involve inherent risks and uncertainties, many of which are difficult to predict and are generally beyond our control. There can be no assurance that future developments affecting us will be the same as those anticipated by management. We caution readers that a number of important factors could cause actual results to differ materially from those expressed in, or implied or projected by, such forward-looking statements. These risks and uncertainties include, but are not limited to, the following: the strength of the United States economy in general and the strength of the local economies in which we conduct operations; the effects of, and changes in, trade, monetary and fiscal policies and laws, including interest rate policies of the Board of Governors of the Federal Reserve System; inflation, interest rate, market and monetary fluctuations on the Company's business condition and financial operating results; the impact of changes in financial services policies, laws and regulations; technological changes; weather, natural disasters and other catastrophic events that may or may not be caused by climate change and their effects on economic and business environments in which the Company operates; the continuing adverse impact on the U.S. economy, including the markets in which we operate due to the COVID-19 global pandemic, and the impact of a slowing U.S. economy and increased unemployment on the performance of our loan portfolio, the market value of our investment securities, the availability of sources of funding and the demand for our products; adverse developments with respect to U.S. or global economic conditions and other uncertainties, including the impact of supply chain disruptions, inflationary pressures and labor shortages on the economic recovery and our business; the costs or effects of mergers, acquisitions or dispositions we may make, whether we are able to obtain any required governmental approvals in connection with any such mergers, acquisitions or dispositions, and/or our ability to realize the contemplated financial business benefits associated with any such activities; the ability to execute our business plan in new lending markets; the future operating or financial performance of the Company, including our outlook for future growth and changes in the level of our nonperforming assets and charge-offs; the appropriateness of the allowance for credit losses, including the timing and effects of the implementation of the current expected credit losses model; any deterioration in values of California real estate, both residential and commercial; the effect of changes in accounting standards and practices; possible other-than-temporary impairment of securities held by us; changes in consumer spending, borrowing and savings habits; our ability to attract and maintain deposits and other sources of liquidity; changes in the financial performance and/or condition of our borrowers; our noninterest expense and the efficiency ratio; competition and innovation with respect to financial products and services by banks, financial institutions and non-traditional providers including retail businesses and technology companies; the challenges of integrating and retaining key employees; the costs and effects of litigation and of unexpected or adverse outcomes in such litigation; a failure in or breach of our operational or security systems or infrastructure, or those of our third-party vendors or other service providers, including as a result of cyber-attacks and the cost to defend against such attacks; change to U.S. tax policies, including our effective income tax rate; the effect of a fall in stock market prices on our brokerage and wealth management businesses; the discontinuation of the London Interbank Offered Rate and other reference rates; and our ability to manage the risks involved in the foregoing. Additional factors that could cause results to differ materially from those described above can be found in our Annual Report on Form 10-K for the year ended December 31, 2020, which has been filed with the Securities and Exchange Commission (the “SEC”) and are available in the “Investor Relations” section of our website, https://www.tcbk.com/investor-relations and in other documents we file with the SEC. Annualized, pro forma, projections and estimates are not forecasts and may not reflect actual results. We undertake no obligation (and expressly disclaim any such obligation) to update or alter our forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by law. 2 SAFE HARBOR STATEMENT

January 2022 Investor Presentation • Most Recent Quarter Recap • Company Overview • Lending Overview • Deposit Overview • Financials 3 AGENDA

January 2022 Investor Presentation4 MOST RECENT QUARTER HIGHLIGHTS Consistent Profitability • Pre-tax pre-provision ROAA and ROAE were 1.84% and 15.72%, respectively, for the quarter ended December 31, 2021, and 1.96% and 16.33%, respectively, for the same quarter in the prior year. • Total revenue and EPS growth totaled 4.0% and 19.0% during the fourth quarter of 2021 as compared to the same quarter in the prior year. • Our efficiency ratio was 53.2% during the 2021 year, compared to 58.4% during the prior year. Growth to Drive Results • Organic non-PPP net loan growth was $119.4 million, a 10.1% annualized increase over the trailing quarter, non-PPP loan growth for the entire 2021 year was $419.1 million or 9.4%. • Recently opened Southern California commercial banking centers contributed $34.7 million and $38.8 million in net loan growth for the three and six months ended December 31, 2021. • Management anticipates that final regulatory approval for the merger with Valley Republic Bancorp will be obtained during the first quarter of 2022. • Management is actively monitoring a variety of additional acquisition opportunities. Net Interest Income and Margin • Net interest margin (FTE) of 3.50% was consistent in the current and trailing quarterly periods compared to 3.71% during Q4-2020. While compression in NIM has been driven by growth in volume of the investment security portfolio, the yield these securities increased 5 basis points to 1.69% during the quarter. • Growth in non-interest-bearing deposits and further decreases in rates continued to drive improved funding costs where total cost of deposits was 0.04% in Q4 2021 compared to 0.07% Q4 2020. Credit Quality • Excluding PPP, loan loss reserves were 1.76% of total loans compared to 1.78% as of September 30, 2021 and 2.07% as of December 31, 2020. • Over 90% of all PPP loan originations have been forgiven by the SBA. • Further decreases in the volume of COVID related loan payment deferral modifications, the balance of past due loans, and a continued low ratio of classified loans to total loans. Diverse Deposit Base • Non-interest-bearing deposits comprise 40.4% of total deposits, and core deposits have grown 13.2% YOY Capital Strategies • Consistent quarterly dividend payments with a history of periodic increases. • Strength in core earnings is key to self-financed and self-funded growth. • Active share repurchase program with demonstrated utilization, albeit currently on hold as a result of the pending merger.

January 2022 Investor Presentation5 COMPANY OVERVIEW

January 2022 Investor Presentation Nasdaq: TCBK Headquarters: Chico, California Stock Price*: $42.96 Market Cap.: $1.3 Billion Asset Size: $8.6 Billion Loans: $4.9 Billion Deposits: $7.4 Billion Bank Branches: 68 ATMs: 86 Bank ATMs, with access to over 37,000 network ATMs Market Area: TriCo currently serves 31 counties throughout California. 6 COMPANY OVERVIEW * As of close of business December 31, 2021

January 2022 Investor Presentation7 EXECUTIVE TEAM Rick Smith President & CEO TriCo since 1993 John Fleshood EVP Chief Operating Officer TriCo since 2016 Dan Bailey EVP Chief Banking Officer TriCo since 2007 Craig Carney EVP Chief Credit Officer TriCo since 1996 Peter Wiese EVP Chief Financial Officer TriCo since 2018 Judi Giem SVP Chief HR Officer TriCo since 2020 Greg Gehlmann SVP General Counsel TriCo since 2017

January 2022 Investor Presentation8 POSITIVE EARNINGS TRACK RECORD Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21 Net Income ($MM) $13.9 $15.0 $16.2 $23.2 $22.7 $23.1 $23.4 $22.9 $16.1 $7.4 $17.6 $23.6 $33.6 $28.4 $27.4 $28.2 Qtrly Diluted EPS $0.60 $0.65 $0.53 $0.76 $0.74 $0.75 $0.76 $0.75 $0.53 $0.25 $0.59 $0.79 $1.13 $0.95 $0.92 $0.94 $0.00 $0.40 $0.80 $1.20 $0 $4 $8 $12 $16 $20 $24 $28 $32 $36 Q tr ly E P S ( di lu te d) E ar ni n gs ( in M ill io ns )

January 2022 Investor Presentation 31% 31% 37% 27% 27% 41% 25% 2015 2016 2017 2018 2019 2020 2021 9 SHAREHOLDER RETURNS Dividends per Share: 11.5% CAGR* Dividends as % of Earnings Return on Avg. Shareholder Equity Diluted EPS * CAGR based upon 2015 full year to 2021 full year. $0.11 $0.15 $0.15 $0.17 $0.19 $0.22 $0.25 $0.13 $0.15 $0.17 $0.17 $0.19 $0.22 $0.25 $0.13 $0.15 $0.17 $0.17 $0.22 $0.22 $0.25 $0.15 $0.15 $0.17 $0.19 $0.22 $0.22 $0.25 $0.52 $0.60 $0.66 $0.70 $0.82 $0.88 $1.00 2015 2016 2017 2018 2019 2020 2021 Q1 Q2 Q3 Q4 10.04% 9.47% 8.10% 10.75% 10.49% 7.18% 12.10% 2015 2016 2017 2018 2019 2020 2021 $0.36 $0.46 $0.52 $0.60 $0.74 $0.53 $1.13 $0.49 $0.41 $0.58 $0.65 $0.75 $0.25 $0.95 $0.55 $0.53 $0.51 $0.53 $0.76 $0.59 $0.92 $0.50 $0.54 $0.76 $0.75 $0.79 $0.94 $1.91 $1.94 $1.74 $2.54 $3.00 $2.16 $3.94 2015 2016 2017 2018 2019 2020 2021 Q1 Q2 Q3 Q4

January 2022 Investor Presentation Organic Growth and Disciplined Acquisitions 10 CONSISTENT GROWTH CAGR 5 yrs. 10 yrs. Total Assets 13.8% 12.9% Excluding PPP 13.6% 12.8%

January 2022 Investor Presentation Executive Management Themes and Topics 11 “TOP OF MIND” • Successfully Integrate And Leverage Synergies From The Merger With Valley Republic Bank • Driving Loan and Non-Interest Income Growth / Diversification Through Organic And Acquisition Based Strategies • Challenges To Growth Plans May Be Caused by Possible Current And Future Regulatory & Administrative Policy Making • Learning and Leading Through An Actionable Data Strategy To Validate And Drive Growth and Expansion • Industry Consolidation, Talent Acquisition And Proactive Succession Planning • Irrational Competitor Reactions to Potential Higher Interest Rates • Potential for Long-term Inflationary Pressures • Operational Scaling and Automation To Drive Leverage While Maintaining Service Level Differentiation And Enhanced Customer Experiences

January 2022 Investor Presentation12 LOANS AND CREDIT QUALITY

January 2022 Investor Presentation13 CONSISTENT LOAN GROWTH • 2018 includes acquisition of FNB Bancorp (Loan Yield was 5.04%); Q1 2021 increase includes $98MM Jumbo Mortgage pool purchase • End of period balances are presented net of fees and include LHFS. Yields based on average balance and annualized quarterly interest income. $3,015 $4,022 $4,038 $4,104 $4,182 $4,305 $4,381 $4,386 $4,407 $4,443 $4,610 $4,711 $4,739 $4,859$423 $426 $327 $361 $240 $151 $61 5.16% 5.24% 5.48% 5.50% 5.46% 5.33% 5.23% 5.05% 4.78% 5.0… 5.15% 4.86% 4.92% 4.96% 3.50% 4.50% 5.50% 6.50% 2017 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q3 2021 Q4 2021 Non-PPP PPP Loans Loan Yield Loan Yield Excl PPP

January 2022 Investor Presentation14 GROSS PRODUCTION VS PAYOFF • Outstanding Principal in Millions, excludes PPP • Includes Q1 2021 increase of $98MM and Q4 2020 increase of $40MM in Jumbo Mortgage pool purchases TCBK originated nearly $1.5 billion in 2021, compared to nearly $0.8 billion in 2020, while facing headwinds of an increased $372 million in payoffs during 2021. In addition to the nearly $0.8 billion in non-PPP loan originations in 2020, TCBK originated over $0.4 billion in PPP loans. TCBK originated over $0.9 billion in loans in 2019, while facing headwinds of outpacing payoffs in excess of $0.6 billion. $144 $200 $229 $349 $178 $199 $165 $250 $464 $285 $303 $412 -$118 -$147 -$139 -$210 -$118 -$139 -$131 -$166 -$241 -$192 -$243 -$250 -$21 $14 -$15 -$14 $6 -$56 -$20 -$47 -$59 $6 -$33 -$47 Q1-2019 Q2-2019 Q3-2019 Q4-2019 Q1-2020 Q2-2020 Q3-2020 Q4-2020 Q1-2021 Q2-2021 Q3-2021 Q4-2021 Origination Paid/Closed Balance Change net of Originations and Payoffs

January 2022 Investor Presentation $1,603 $706 $823 $670 $259 $338 $222 $224 $67 $1,536 $624 $639 $553 $526 $327 $285 $197 $78 CRE Non-Owner Occupied CRE-Owner Occupied Multifamily SFR 1-4 Term Commercial & Industrial SFR HELOC and Junior Liens Construction Agriculture & Farmland Auto & Other 4Q-2021 4Q-2020 15 DIVERSIFIED LOAN PORTFOLIO Note: Dollars in millions, Net Book Value at period end, excludes LHFS; Auto & other includes Leases. Commercial & Industrial includes two Municipality Loans for $3.65 mln. CRE Non- Owner Occupied 33% CRE-Owner Occupied 14% Multifamily 17% SFR 1-4 Term 14% Commercial & Industrial 5% SFR HELOC and Junior Liens 7% Construction 4% Agriculture & Farmland 5% Auto & Other 1%

January 2022 Investor Presentation 70% 55% 61% 58% 62% 74% 38% 46% 26% 40% 37% 40% 38% 22% 60% 47% 4% 5% 2% 2% 0% 4% 2% 7% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% Hotel/Motel Office Building Retail Building Warehouse Light Industrial Other Multifamily CRE Owner Occupied <= 60% > 60% - 75% > 75% 16 CRE COLLATERAL VALUES LTV Range CRE Non-Owner-Occupied by Collateral Type DISTRIBUTION BY LTV

January 2022 Investor Presentation HELOCs – by vintage, with weighted avg. coupon 17 UNFUNDED LOAN COMMITMENTS  Outstanding Principal and Commitments exclude unearned fees and discounts/premiums, Leases, DDA Overdraft, and Credit Cards  C&I includes PPP loans for $63 million and $334 million in Outstanding Principal Q4 2021 and Q4 2020, respectively. 0.00% 1.00% 2.00% 3.00% 4.00% 5.00% 6.00% $0 $25 $50 $75 $100 $125 $150 $175 20212020201920182017201620152014201320122011201020092008>2008 Private Balance (MM) Unfunded (MM) WA Rate 3.31% 4.11% 4.42%4.51%4.48%4.43%4.29%4.34% 4.72% 5.51% 4.69%4.46%4.63% 3.55%3.62% $1,619 $1,557 $828 $643 $335 $324 $530 $254 $711 $628 $672 $557 $288 $225 $224 $197 $76 $63 $170 $88 $44 $40 $531 $535 $372 $339 $31 $27 $221 $211 $69 $62 $11 $9 4Q-2021 4Q-2020 4Q-2021 4Q-2020 4Q-2021 4Q-2020 4Q-2021 4Q-2020 4Q-2021 4Q-2020 4Q-2021 4Q-2020 4Q-2021 4Q-2020 4Q-2021 4Q-2020 4Q-2021 4Q-2020 CRE Non-Owner Occupied Multifamily SFR HELOC and Junior Liens Commercial & Industrial CRE-Owner Occupied SFR 1-4 Term Construction Agriculture & Farmland Auto & Other Outstanding Principal ($MM) Unfunded Commitment ($MM)

January 2022 Investor Presentation18 C&I UTILIZATION  Excludes PPP loans; Outstanding Principal excludes unearned fees and discounts/premiums ($ millions) $248 $243 $247 $262 $208 $205 $197 $187 $206 $186 $191 $207 $221 $254 $235 $265 $273 $372 $384 $360 $353 $339 54.5% 52.4% 49.3% 52.7% 44.0% 42.9% 34.5% 32.7% 36.4% 34.5% 36.0% 0% 10% 20% 30% 40% 50% 60% $0 $100 $200 $300 $400 $500 $600 $700 2Q-2019 3Q-2019 4Q-2019 1Q-2020 2Q-2020 3Q-2020 4Q-2020 1Q-2021 2Q-2021 3Q-2021 4Q-2021 M ill io ns o f $ Outstanding Principal ($MM) Unfunded Commitment Utilization

January 2022 Investor Presentation19 LOAN YIELD COMPOSITION  Dollars in millions, Wtd Avg Rate (weighted average rate) as of 12/31/2021 and based upon outstanding principal; excludes unearned fees and accretion/amortization therein • Variable rate loans at their floor as a percentage of total variable loans has remained stable at 88% in Q4-2021. • The most prominent index for the variable portfolio is 5 Year Treasury CMT. Fixed 38% Variable At Floor 54% Variable Above Floor 7% Variable No Floor 1% Fixed vs. Variable, Total Loans (ex-PPP)

January 2022 Investor Presentation20 LOAN YIELD COMPOSITION  Dollars in millions, WA Rate (weighted average rate) as of 12/31/2021 and based upon outstanding principal; excludes PPP as well as unearned fees and accretion/amortization therein  Next Reprice signifies either the next scheduled reprice date or maturity. When reprice date is blank, index is prime and monthly frequency indicator is applied, loan is classified as Monthly. Loans at Floor by Year of Next Reprice $465 $251 $183 $278 $354 $574 $539 4.02% 4.03% 3.95% 3.98% 4.07% 4.23% 3.94% 4.54% 4.59% 4.87% 4.83% 4.29% 4.21% 3.92% 3.50% 4.00% 4.50% 5.00% 5.50% Monthly < 1 Year 1 - 2 Years 2 - 3 Years 3 - 4 Years 4 - 5 Years > 5 Years Balance WA Rate No Floor WA Rate at Floor

January 2022 Investor Presentation21 LOAN YIELD COMPOSITION  Dollars in millions, WA Rate (weighted average rate) as of 12/31/2021 and based upon outstanding principal; excludes PPP as well as unearned fees and accretion/amortization therein  Next Reprice signifies either the next scheduled reprice date or maturity. When reprice date is blank, index is prime and monthly frequency indicator is applied, loan is classified as Monthly. Loans at Floor by Year of Next Reprice – Commercial Real Estate & Multifamily $98 $197 $160 $220 $288 $480 $416 4.13% 4.10% 4.00% 3.97% 4.09% 4.26% 4.10% 4.48% 4.58% 4.90% 4.77% 4.26% 4.23% 4.04% 3.50% 4.00% 4.50% 5.00% 5.50% Monthly < 1 Year 1 - 2 Years 2 - 3 Years 3 - 4 Years 4 - 5 Years > 5 Years Balance WA Rate No Floor WA Rate At Floor

January 2022 Investor Presentation22 ALLOWANCE FOR CREDIT LOSSES Drivers of Change under CECL  Change in reserve for all collectively and individually analyzed loans rated criticized or worse  Lagging recovery of California Unemployment remains the largest driver of qualitative factors  Uncertainty due to Omicron variant surge reflected in forward looking factors Total reserve increase of $1.070 million Q4 2021  Includes volume and mix change due to originations, draws, pay downs, and payoffs  Improvement in risk grades overall, coupled with continued low loss experience, results in declining quantitative loss rates  Gross charge offs $0.197 million  Gross recoveries $0.552 million 1.72% of Total Loans 1.78% Excluding PPP 1.74% of Total Loans 1.76% Excluding PPP

January 2022 Investor Presentation23 ALLOWANCE FOR CREDIT LOSSES Allocation of Allowance by Segment

January 2022 Investor Presentation24 RISK GRADE MIGRATION  Zero balance in Doubtful and Loss 89.6%87.2%85.0%84.6%82.1%82.2% 7.8% 9.3%11.2%11.4% 13.6%13.8% 1.6%2.5%2.6%2.9%3.3%3.0% 1.1%1.0%1.2%1.2%1.0%1.0% 4Q-20213Q-20212Q-20211Q-20214Q-20203Q-2020 % o f L o a n P o rt fo lio O u ts ta n d in g , b y R is k G ra d e Pass Watch Special Mention Substandard

January 2022 Investor Presentation 0.45% 0.45% 0.32% 0.35% 0.30% 0.28% 0.30% 0.31% 0.33% 0.38% 0.38% 0.42% 0.37% 0.38% 0.64% 0.58% 0.59% 0.61% 0.54% 0.47% 0.73% 0.53% 0.58% 0.75% 0.73% 0.68% 0.64% 2018 Q3 2018 Q4 2019 Q1 2019 Q2 2019 Q3 2019 Q4 2020 Q1 2020 Q2 2020 Q3 2020 Q4 2021 Q1 2021 Q2 2021 Q3 2021 Q4 TCBK Peers 25 ASSET QUALITY  Peer group consists of 99 closest peers in terms of asset size, range $4.1-11.5 Billion source: BankRegData.com  NPA and NPL ratios displayed are net of guarantees Coverage Ratio: Allowance as % of Non-Performing Loans NPAs have remained below peers while loss coverage has expanded, first with the adoption of CECL, then through the on-going concerns of the pandemic; resulting in an increase in the coverage ratio throughout 2020. Subsequently, moderate releases have been recorded while Q4 2021 saw an increase which was generally commensurate with the loan portfolio growth. Non-Performing Assets as a % of Total Assets 124% 174% 159% 180% 193% 343% 385% 395% 342% 297% 263% 293% 281% 13 4% 13 1% 12 9% 14 5% 15 6% 13 9% 20 2% 19 1% 17 9% 18 7% 19 4% 19 7% 2018 Q4 2019 Q1 2019 Q2 2019 Q3 2019 Q4 2020 Q1 2020 Q2 2020 Q3 2020 Q4 2021 Q1 2021 Q2 2021 Q3 2021 Q4 TCBK Peers

January 2022 Investor Presentation26 DEPOSITS

January 2022 Investor Presentation27 DEPOSITS: STRENGTH IN FUNDING Total Deposits = $7.37 billion 98.6% of Funding Liabilities Liability Mix 12/31/2021  Peer group consists of 99 closest peers in terms of asset size, range $4.7-11.5 Billion; source: BankRegData.com  Net Loans includes LHFS and Allowance for Credit Loss; Core Deposits = Total Deposits less CDs > 250k and Brokered Deposits Non Interest- Bearing Demand Deposits, 39.1% Interest-Bearing Demand & Savings Deposits, 53.7% Time Deposits, 3.9% Borrowings & Subordinated Debt, 1.4% Other Liabilities, 1.8% 8 0 .7 7 6 .3 7 5 .5 7 8 .1 8 0 .6 8 1 .6 8 1 .6 7 6 .9 7 5 .9 7 2 .7 7 1 .8 7 0 .2 6 6 .9 6 6 .0 0 20 40 60 80 100 120 2018 Q3 2018 Q4 2019 Q1 2019 Q2 2019 Q3 2019 Q4 2020 Q1 2020 Q2 2020 Q3 2020 Q4 2021 Q1 2021 Q2 2021 Q3 2021 Q4 Loans to Core Deposits (%) TCBK Peers 3 3 .6 3 2 .8 3 2 .4 3 3 .3 3 3 .6 3 4 .1 3 4 .9 3 9 .8 3 9 .7 3 9 .7 4 0 .3 4 0 .7 4 0 .7 4 0 .4 0 10 20 30 40 2018 Q3 2018 Q4 2019 Q1 2019 Q2 2019 Q3 2019 Q4 2020 Q1 2020 Q2 2020 Q3 2020 Q4 2021 Q1 2021 Q2 2021 Q3 2021 Q4 Non Interest-bearing Deposits as % of Total Deposits TCBK Peer (0.03% Funding Cost)

January 2022 Investor Presentation Cost of Deposits Non Int-Bearing Demand - - - - - - - - - - - - Int-Bearing Demand & Sav 0.18% 0.20% 0.19% 0.19% 0.16% 0.09% 0.06% 0.05% 0.04% 0.04% 0.05% 0.03% Time Deposits 1.18% 1.28% 1.39% 1.27% 1.23% 1.09% 0.89% 0.68% 0.64% 0.55% 0.52% 0.45% Total Deposits 0.20% 0.22% 0.23% 0.22% 0.19% 0.12% 0.09% 0.07% 0.06% 0.05% 0.05% 0.04% Interest-bearing Deposits 0.30% 0.33% 0.34% 0.33% 0.29% 0.20% 0.15% 0.12% 0.10% 0.08% 0.08% 0.06% 28 DEPOSITS: STRENGTH IN COST OF FUNDS  Continued growth in the volume of noninterest- bearing deposits both in terms of dollars and as a percent of total deposits.  Industry leading cost of total deposits, driven by better than peer mix of non- interest-bearing deposits. $446 $441 $451 $441 $419 $399 $376 $345 $328 $324 $327 $298 $3,223 $3,121 $3,067 $3,094 $3,101 $3,363 $3,446 $3,580 $3,769 $3,824 $3,967 $4,090 $1,762 $1,780 $1,777 $1,833 $1,883 $2,487 $2,518 $2,582 $2,767 $2,844 $2,943 $2,980 $5,430 $5,342 $5,295 $5,367 $5,403 $6,248 $6,341 $6,506 $6,863 $6,992 $7,237 $7,367 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 Q4'21

January 2022 Investor Presentation29 FINANCIALS

January 2022 Investor Presentation30 CONSISTENT OPERATING METRICS Net Interest Margin (FTE) PPNR as % of Average Assets Efficiency Ratio ROAA 4.32% 4.23% 4.22% 4.30% 4.47% 3.96% 3.58% 2015 2016 2017 2018 2019 2020 2021 65.1% 68.7% 65.4% 63.7% 59.7% 58.4% 53.2% 2015 2016 2017 2018 2019 2020 2021 1.79% 1.60% 1.70% 1.73% 1.94% 1.83% 1.91% 2015 2016 2017 2018 2019 2020 2021 1.11% 1.02% 0.89% 1.24% 1.43% 0.91% 1.43% 2015 2016 2017 2018 2019 2020 2021

January 2022 Investor Presentation31 WELL CAPITALIZED Tier 1 Capital Ratio Total Risk Based Capital CET1 Ratio Tangible Common Equity Ratio 9.2% 9.1% 9.3% 9.5% 10.6% 9.3% 9.2% 2015 2016 2017 2018 2019 2020 2021 13.8% 13.7% 13.2% 13.7% 14.4% 14.0% 14.2% 2015 2016 2017 2018 2019 2020 2021 12.2% 12.2% 11.7% 12.5% 13.3% 12.9% 13.2% 2015 2016 2017 2018 2019 2020 2021 15.1% 14.8% 14.1% 14.4% 15.1% 15.2% 15.4% 2015 2016 2017 2018 2019 2020 2021

January 2022 Investor Presentation32 August 0

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