• Eagle Bancorp, Inc. Announces Net Income for Fourth Quarter 2022 of $42.2 Million or $1.32 Per Diluted Share and Annual Earnings of $140.9 Million or $4.39 Per Diluted Share

    Source: Nasdaq GlobeNewswire / 18 Jan 2023 16:15:01   America/New_York

    BETHESDA, Md., Jan. 18, 2023 (GLOBE NEWSWIRE) -- Eagle Bancorp, Inc. (the "Company") (NASDAQ: EGBN), the parent company of EagleBank (the "Bank"), today announced net income of $42.2 million for the fourth quarter 2022, compared to net income of $37.3 million for the prior quarter and $41.6 million for the year-ago quarter. Net income (basic and diluted) was $1.32 per share for the fourth quarter 2022, compared to $1.16 per share for the prior quarter and $1.30 per share for the year-ago quarter.

    The increase in earnings of $4.9 million from the third quarter of 2022 (the "prior quarter") was primarily attributable to the difference created by moving from a provision to the allowance for credit losses to a reversal from the allowance for credit losses, a lower tax provision and higher net interest income. Partially offsetting these increases in earnings from the prior quarter were higher noninterest expenses.

    Full year 2022 net income was $140.9 million, or $4.40 per share (basic) and $4.39 per share (diluted). On a diluted basis, this was a decrease of $1.13 per share compared to $5.52 per share for the prior year. If adjusted to remove the one-time noninterest expense accruals for the previously disclosed settlement agreements and the reduction in noninterest expense accruals associated with compensation of the former CEO/Chairman, adjusted net income, a non-GAAP measure, was $158.8 million, or $4.95 per share (diluted).1 As adjusted, this is a decrease of $0.57 per share, compared to $5.52 per share (diluted) for the prior year.

    Fourth Quarter 2022 Highlights

    • Loans at quarter-end were $7.6 billion, up $331.1 million from the prior quarter-end. This was the fifth consecutive quarterly increase. Loans were up 4.5% from the prior quarter and 8.1% from the year-ago quarter. Together with the smaller decrease in deposits, this increased the quarter-end loans-to-deposits ratio to 88%, up from 83% a quarter ago and 71% a year ago.
    • Reversal to the allowance from credit losses was $0.5 million for the quarter, down from a provision of $3.0 million the prior quarter. This reduced the allowance for credit losses on loans to 0.97%, down from 1.04% a quarter ago and down from 1.06% a year ago.
    • Deposits at quarter-end were $8.7 billion, down $50.2 million from the prior quarter-end, and average deposits for the quarter decreased by $383.4 million. Short-term borrowings were $975.0 million, up $460.0 million from the prior quarter-end, and average borrowings for the quarter increased by $253.1 million.
    • During the quarter, the Company repurchased 738,300 shares at an average price of $44.82 per share (including commissions), totaling an aggregate of $33.1 million, and for 2023 adopted a new share repurchase program authorizing the repurchase of 1.6 million shares, or approximately 5% of outstanding shares.
    • During the quarter, the Company declared a quarterly dividend of $0.45 per share.
    (Dollars in thousands, except per share)As Of or For the Three Months Ended Percent Change
     Dec. 31, Sept. 30, Dec. 31, Q4-22 Q4-22
     2022 2022 2021 vs. Q3-22 vs. Q4-21
    Income Statement         
    Net income$42,193  $37,297  $41,620  13.1% 1.4%
    Net income per diluted share$1.32  $1.16  $1.30  13.8% 1.5%
    Dividend per common share$0.45  $0.45  $0.40  —% 12.5%
              
    Selected Ratios         
    Return on Average Assets 1.49%  1.29%  1.32% —  — 
    Return on Average Common Equity 13.57%  11.64%  12.30% —  — 
    Return on Average Tangible Common Equity2 14.82%  12.67%  13.35% —  — 
    Net interest margin 3.14%  3.02%  2.55% —  — 
    Efficiency Ratio3 42.8%  40.6%  44.3% —  — 
              
    Balance Sheet         
    Assets$11,150,854  $10,713,044  $11,847,310  4.1% (5.9)%
    Loans$7,635,632  $7,304,498  $7,065,598  4.5% 8.1%
    Loans (excluding PPP loans)3$7,632,376  $7,297,257  $7,014,493  4.6% 8.8%
    Deposits$8,713,182  $8,763,350  $9,981,540  (0.6)% (12.7)%
    Total Capital (to risk weighted assets) 14.99%  15.60%  15.74% —  — 
              
    Per Share         
    Book value per share$39.18  $38.02  $42.28  3.1% (7.3)%
    Tangible book value per share(2)$35.86  $34.77  $38.97  3.1% (8.0)%
              
    Asset quality         
    Allowance for credit losses to total loans 0.97%  1.04%  1.06% —  — 
    Nonperforming assets ("NPAs") to total assets 0.08%  0.09%  0.26% —  — 
    Net charge-off ratio to avg. loans (annualized) 0.05%  —%  0.07% —  — 
                      

    CEO Commentary

    Susan G. Riel, President and Chief Executive Officer of Eagle Bancorp, Inc. commented, "We ended 2022 on a high note, as we had our best quarter of the year for loan growth, asset quality metrics remained strong and we were active in stock repurchases. Loans at quarter-end were up 4.5% from the prior quarter and pipelines remain strong. Strong asset quality metrics coupled with improvements in the quantitative model led us to once again book a reversal to our reserve for credit losses. And, for our shareholders, during the quarter, we repurchased 738,300 shares of stock with an aggregate value of $33.1 million."

    "We once again thank all of our employees for their commitment in serving the needs of our clients and communities. Additionally, we remain committed to a culture of respect, diversity and inclusion in both the workplace and the communities we serve."

    Income Statement

    • Net interest income was $85.6 million for the fourth quarter 2022, compared to $83.9 million for the prior quarter and $78.2 million for the year-ago quarter. The increase in net interest income from the prior quarter was primarily driven by higher average loans for the quarter and higher yields on loans as the overall rate environment remained elevated. The combination of these factors outpaced the increase in interest expense from higher rates on interest bearing deposits and borrowings, and an increase in borrowings.

    • Net interest margin ("NIM") was 3.14% for the fourth quarter 2022, compared to 3.02% for the prior quarter and 2.55% for the year-ago quarter. The increase in margin from the prior quarter was 12 basis points. The NIM growth was based on the yield on earning assets increasing by 72 basis points, offset by the 60 basis points increase in the cost of funds.
      • The yield on interest earning assets, which is inclusive of the yields on loans and securities, was 4.73% for the fourth quarter 2022 compared to 4.01% for the prior quarter and 2.81% for the year-ago quarter. The increase of 72 basis points from the prior quarter was from variable rate loans adjusting upward, higher rates on newly originated loans and higher rates on short-term investments.
      • The yield on the loan portfolio was 5.87% for the fourth quarter 2022, compared to 5.10% for the prior quarter and 4.45% for the year-ago quarter. The increase of 77 basis points from the prior quarter was from variable rate loans adjusting upward and from higher rates on newly originated loans.
      • The cost of funds was 1.59% for fourth quarter 2022, compared to 0.99% for the prior quarter and 0.26% for the year-ago quarter. The increase of 60 basis points from the prior quarter was primarily due to higher rates paid on savings and money market accounts and borrowings during the fourth quarter.
    • Pre-provision net revenue ("PPNR"),4 a non-GAAP measure, was $52.0 million for the fourth quarter 2022, compared to $53.0 million for the prior quarter and $49.5 million for the year-ago quarter. As a percent of average assets, PPNR for the fourth quarter 2022 was 1.83%5, compared to 1.85%5 for the prior quarter and 1.56%5 for the year-ago quarter. This small decrease in both PPNR and PPNR as a percent of average assets from the prior quarter was primarily attributable to the increase in net interest income being slightly less than the increase in noninterest expense. The larger increase from the year-ago quarter was attributable to the increase in net interest income from higher rates and an expanded net interest margin, more than offsetting the decline in noninterest income from lower mortgage originations.

    (Dollars in thousands)Three Months Ended Percent Change
     December 31, September 30, December 31, Q4-22 Q4-22
     2022 2022 2021 vs. Q3-22 vs. Q4-21
    Net interest income$85,600  $83,897  $78,186  2.0% 9.5%
    Noninterest income 5,329   5,308   10,574  0.4% (49.6)%
    Less: Noninterest expense (38,918)  (36,206)  (39,309) 7.5% (1.0)%
    PPNR$52,011  $52,999  $49,451  (1.9)% 5.2%
              
    Average Assets$11,255,956  $11,431,110  $12,538,596  (1.5)% (10.2)%
    PPNR to Avg. Assets (non-GAAP) 1.83%  1.85%  1.56% —  — 
    • Provision for credit losses on loans was a reversal of $0.5 million for the fourth quarter 2022, compared to a provision of $3.0 million for the prior quarter and a reversal of $6.4 million for the year-ago quarter. The decrease in the fourth quarter 2022 provision over the prior quarter was primarily driven by improvements in quantitative metrics partially offset by higher loan balances and increased risk in the qualitative and environmental ("Q&E") portion of the credit model. The improvement in quantitative metrics was associated with a decrease in the localization factor relative to the national unemployment forecast. The increased risk in Q&E portion of the model was attributable to the impact of the elevated risk associated with economic and business conditions.

    • Noninterest income was $5.3 million for the fourth quarter 2022, as compared to $5.3 million for the prior quarter and $10.6 million for the year-ago quarter. The primary driver for the decrease in the fourth quarter 2022 and the prior quarter as compared to the year-ago quarter is higher rates on mortgage loans leading to fewer mortgage originations.

      Residential mortgage loan locked commitments were $37.5 million, down from $57.5 million for the prior quarter and down from $163.0 million for the year-ago quarter. As interest rates remained high in the fourth quarter, refinance activity continued to be slow resulting in a relatively low level of locked loans.
    • Noninterest expense was $38.9 million for the fourth quarter 2022 compared to $36.2 million for the prior quarter and $39.3 million for the year-ago quarter. The notable changes from the prior quarter were as follows:
      • Salaries and employee benefits were $23.7 million, up $2.2 million from the prior quarter. The increase was primarily due to higher incentive bonus accruals.
      • Data processing expenses were $3.1 million, down $328 thousand from the prior quarter.
      • Legal, accounting and professional fees were $2.6 million, up $221 thousand from the prior quarter.
    • Efficiency ratio6 was 42.8% for the fourth quarter 2022 compared to 40.6% for the prior quarter and 44.3% for the year-ago quarter. The increase in the efficiency ratio this quarter was primarily driven by the increase in noninterest expense outpacing the increase in net interest income.

    • Effective income tax rate for the fourth quarter 2022 was 19.3%, compared to 24.2% for the prior quarter and 26.3% for the year-ago quarter. The decrease in the effective tax rate this quarter was primarily driven by an update in our state apportionment of revenues in the states in which we operate.

    Balance Sheet

    • Total assets at December 31, 2022 were $11.2 billion, up 4.1% from a quarter ago and down 5.9% from a year ago. The increase from the prior quarter-end was primarily driven by the increase in loans, and to a lesser extent, the increase in interest-bearing deposits with banks and other short-term investments. The growth in these asset types were funded with an increase in short-term borrowings.

    • Investment securities Available-for-Sale ("AFS") and Held-to-Maturity ("HTM") had an aggregate balance of $2.7 billion at December 31, 2022, down 2.6% from a quarter ago and up 2.6% from a year ago. The decrease from the prior quarter-end was primarily from principal paydowns and maturities received, offset by a slightly higher carrying value on AFS securities. Investments purchased during the fourth quarter of 2022 were primarily agency mortgage backed securities for CRA Investment credit.

    • Total loans (excluding loans held for sale) were $7.6 billion as of December 31, 2022, up 4.5% from a quarter ago and up 8.1% from a year ago. Excluding PPP loans, adjusted loan balances, a non-GAAP measure, were up 4.6% from a quarter ago and up 8.8% from a year ago.7 The increase in total loans from the prior quarter-end was driven by growth in commercial real estate ("CRE") loans and commercial & industrial loans ("C&I"). The increase in loans increased the ratio of loans-to-deposits to 88% from 83% the prior quarter.

           Percent Change
    (Dollars in thousands)December 31, September 30, December 31, Q4-22 Q4-22
     2022
    		 2022
    		 2021
    		 vs. Q3-22 vs. Q4-21
    Total loans, excluding loans held for sale (GAAP)$7,635,632  $7,304,498  $7,065,598  4.5% 8.1%
    Less: PPP loans (non-GAAP) (3,256)  (7,241)  (51,105)    
    Total loans, excluding loans held for sale and PPP loans (non-GAAP)$7,632,376  $7,297,257  $7,014,493  4.6% 8.8%
    • Allowance for credit losses was 0.97% of total loans at December 31, 2022, compared to 1.04% a quarter ago, and 1.06% a year ago. See commentary above in section "Provision for Credit Losses on Loans".

      Net charge-off was $896 thousand, which as a percent of average loans (excluding loans held for sale) was 0.05%8 for the fourth quarter 2022, compared to a small recovery which was less than 0.01%7 a quarter ago, and a net charge-off of 0.07%7 for the year-ago quarter.
    • Nonperforming loans and assets: Nonperforming loans decreased compared to the prior quarter and the year-ago quarter. The decrease was driven primarily by loans being paid in full or returning to accrual status due to ongoing payment performance, as well as the partial charge-off of one relationship. Two notes totaling $326 thousand were moved to nonperforming status during the quarter. At quarter end, other real estate owned ("OREO") consisted of four properties with a value of $2.0 million.
      • Nonperforming loans as a percent of loans were 0.08% at December 31, 2022, compared to 0.10% a quarter ago and 0.41% a year ago.
      • Nonperforming assets as a percent of assets were 0.08% at December 31, 2022, compared to 0.09% a quarter ago and 0.26% a year ago.

    • Total deposits were $8.7 billion at December 31, 2022, down 0.6% from a quarter ago and down 12.7% from a year ago. The decrease from the prior quarter-end and a year ago were primarily attributable to outflows from savings and money market accounts. In the most recent quarter, this outflow was partially offset by increases in other types of deposits. As most of the outflows were from savings and money market accounts, average noninterest bearing deposits to average total deposits was 40.9% for the fourth quarter 2022, up from 38.4% a quarter ago and up from 36.3% for the year-ago quarter. The increase in this fourth quarter 2022 percentage does not include the impact of increased short-term borrowings in place of deposit funding.

    • Other short-term borrowings were $975.0 million at December 31, 2022, up 89.3% from a quarter ago, and up 225.0% from a year ago. The increase in borrowings from the prior quarter-end was driven by an effort to meet strong loan demand at quarter-end in light of the decrease in total deposits. These short-term borrowings are from the Federal Home Loan Bank of Atlanta ("FHLB") and are secured by collateral consisting of a blanket lien on qualifying loans in the Bank's commercial mortgage, residential mortgage and home equity loan portfolios.

    • Total shareholders’ equity was $1.2 billion at December 31, 2022, up 0.7% from a quarter ago, and down 9.1% from a year ago. The increase in shareholders' equity of $8.6 million from the prior quarter-end was primarily from net income and a reduction in unrealized losses on investment securities AFS, partially offset by reductions in capital from the impact of share repurchases and dividends paid. Net income for the quarter was $1.32 per share and dividends declared were $0.45 per share.
      • Book value per share was $39.18, up $1.16 from a quarter ago, and down $3.10 from a year ago.
      • Tangible book value per share9 was $35.86, up $1.09 from a quarter ago, and down $3.11 from a year ago.

    • Dividends: On December 14, 2022, the Board of Directors declared a quarterly cash dividend of $0.45 per share payable on January 31, 2023 to shareholders of record on January 5, 2023.

    • Stock Repurchases: During the quarter, the Company repurchased 738,300 shares at an average price of $44.82 per share (including commissions), totaling an aggregate of $33.1 million, and for 2023 adopted a new share repurchase program authorizing the repurchase of 1.6 million shares, or approximately 5% of outstanding shares.

    • Capital ratios for the Company are in the table below. All capital ratios at quarter-end were impacted by the reduction in capital from share repurchases in the fourth quarter of 2022. This impact coupled with an increase in risk weighted assets and a change in the mix of risk weighted assets led to a decline in those capital ratios which are based on risk weighted assets. Tier 1 capital increased as average assets were lower than the prior quarter and common capital ratios declined as quarter-end assets were higher than the prior quarter-end.

     For the Company
     December 31, September 30, December 31,
     202210 2022 2021
    Regulatory Ratios     
    Total Capital (to risk weighted assets)14.99% 15.60% 15.74%
    Tier 1 Capital (to risk weighted assets)14.23% 14.64% 14.63%
    Common Equity Tier 1 (to risk weighted assets)14.23% 14.64% 14.63%
    Tier 1 Capital (to average assets)11.78% 11.55% 10.19%
          
    Common Capital Ratios     
    Common Equity Ratio11.02% 11.39% 11.40%
    Tangible Common Equity Ratio1110.18% 10.52% 10.60%

    Additional financial information: The financial information that follows provides more detail on the Company’s financial performance for the three months ended December 31, 2022 as compared to the three months ended September 30, 2022 and December 31, 2021 as well as eight quarters of trend data. Persons wishing additional information should refer to the Company’s annual report on Form 10-K for the year ended December 31, 2021, quarterly report on Form 10-Q for the quarters ended March 31, 2022, June 30, 2022 and September 30, 2022 and other reports filed with the SEC.

    About Eagle Bancorp: The Company is the holding company for EagleBank, which commenced operations in 1998. The Bank is headquartered in Bethesda, Maryland, and operates through sixteen banking offices and five lending offices, located in Suburban Maryland, Washington, D.C. and Northern Virginia. The Company focuses on building relationships with businesses, professionals and individuals in its marketplace, and is committed to a culture of respect, diversity, equity and inclusion in both its workplace and the communities in which it operates.

    Conference call: Eagle Bancorp will host a conference call to discuss its fourth quarter 2022 financial results on Thursday, January 19, 2023 at 10:00 a.m. eastern time. The public is invited to listen to this registering at the link https://register.vevent.com/register/BI395df276641b44e4aee3848563fb62eb or by accessing the call on the Company’s website, www.EagleBankCorp.com. A replay of the conference call will be available on the Company’s website through February 2, 2023.

    Forward-looking statements: This press release contains forward-looking statements within the meaning of the Securities Exchange Act of 1934, as amended, including statements of goals, intentions, and expectations as to future trends, plans, events or results of Company operations and policies and regarding general economic conditions. In some cases, forward-looking statements can be identified by use of words such as "may," "will," "can," "anticipates," "believes," "expects," "plans," "estimates," "potential," "continue," "should," "could," "strive," "feel" and similar words or phrases. These statements are based upon current and anticipated economic conditions, nationally and in the Company’s market (including ongoing challenges and uncertainties relating to the continued evolution of COVID-19, including on our credit quality, asset and loan growth and broader business operations), volatility in interest rates and interest rate policy, the current high inflationary environment competitive factors, and other conditions which by their nature, are not susceptible to accurate forecast and are subject to significant uncertainty. Because of these uncertainties and the assumptions on which this discussion and the forward-looking statements are based, actual future operations and results in the future may differ materially from those indicated herein. For details on factors that could affect these expectations, see the risk factors and other cautionary language included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 and in other periodic and current reports filed with the SEC. Readers are cautioned against placing undue reliance on any such forward-looking statements. The Company’s past results are not necessarily indicative of future performance, and nothing contained herein is meant to or should be considered and treated as earnings guidance of future quarters’ performance projections. All information is as of the date of this press release. Any forward-looking statements made by or on behalf of the Company speak only as to the date they are made. Except to the extent required by applicable law or regulation, the Company undertakes no obligation to revise or update publicly any forward-looking statement for any reason.

    __________________________________
    1 A reconciliation between this non-GAAP financial measure and the nearest GAAP measure is provided in the tables that accompany this document. Aggregate comprised of settlement agreements of $22.9 million and noninterest expense accrual reductions of $5.0 million.
    2 A reconciliation between this non-GAAP financial measure and the nearest GAAP measure is provided in the tables that accompany this document.
    3 A reconciliation between this non-GAAP financial measure and the nearest GAAP measure is provided in the table under the subsection, "Total Loans."
    4 A reconciliation between this non-GAAP financial measure and the nearest GAAP measure is provided in the table below. An explanation of the reconciliations and the reasons why the Company believes this non-GAAP financial measure to be important for investors is included with the reconciliation tables accompanying this document.
    5 Periods of less than one year are annualized.
    6 A reconciliation between this non-GAAP financial measure and the nearest GAAP measure is provided in the tables that accompany this document.
    7 A reconciliation between this non-GAAP financial measure and the nearest GAAP measure is provided in the following table. An explanation of the reconciliations and the reasons why the Company believes this non-GAAP financial measure to be important for investors is included with the reconciliation tables accompanying this document.
    8 On an annualized basis.
    9 A reconciliation of non-GAAP financial measures to the nearest GAAP measure is provided in the tables that accompany this document.
    10Capital ratios for December 31, 2022 are subject to final filings with the Federal Reserve.
    11A reconciliation of non-GAAP financial measures to the nearest GAAP measure is provided in the tables that accompany this document.

     
    Eagle Bancorp, Inc.
    Consolidated Financial Highlights (Unaudited)
    (Dollars in thousands, except per share data)
          
     Three Months Ended
     December 31, September 30, December 31,
     2022 2022 2021
    Income Statements:     
    Total interest income$129,130  $111,527  $86,230 
    Total interest expense 43,530   27,630   8,044 
    Net interest income 85,600   83,897   78,186 
    Provision for (reversal of) credit losses (464)  3,022   (6,412)
    Provision for (reversal of) unfunded commitments 161   774   (632)
    Net interest income after provision for credit losses 85,903   80,101   85,230 
    Noninterest income (before investment gain) 5,326   5,304   9,668 
    Net gain on sale of investment securities 3   4   906 
    Total noninterest income 5,329   5,308   10,574 
    Total noninterest expense 38,918   36,206   39,309 
    Income before income tax expense 52,314   49,203   56,495 
    Income tax expense 10,121   11,906   14,875 
    Net income$42,193  $37,297  $41,620 
          
    Per Share Data:     
    Earnings per weighted average common share, basic$1.32  $1.16  $1.30 
    Earnings per weighted average common share, diluted$1.32  $1.16  $1.30 
    Weighted average common shares outstanding, basic 31,819,631   32,084,464   31,950,320 
    Weighted average common shares outstanding, diluted 31,898,619   32,155,678   32,030,998 
    Actual shares outstanding at period end 31,346,903   32,082,321   31,950,092 
    Book value per common share at period end$39.18  $38.02  $42.28 
    Tangible book value per common share at period end(1)$35.86  $34.77  $38.97 
    Dividend per common share$0.45  $0.45  $0.40 
          
    Performance Ratios (annualized):     
    Return on average assets 1.49%  1.29%  1.32%
    Return on average common equity 13.57%  11.64%  12.30%
    Return on average tangible common equity(1) 14.82%  12.67%  13.35%
    Net interest margin 3.14%  3.02%  2.55%
    Efficiency ratio(2) 42.8%  40.6%  44.3%
          
    Other Ratios:     
    Allowance for credit losses to total loans(3) 0.97%  1.04%  1.06%
    Allowance for credit losses to total nonperforming loans 1,151%  997%  257%
    Nonperforming loans to total loans(3) 0.08%  0.10%  0.41%
    Nonperforming assets to total assets 0.08%  0.09%  0.26%
    Net charge-off (annualized) to average total loans(3) 0.05%  —%  0.07%
    Average noninterest bearing deposits to average deposits 40.9%  38.4%  36.3%
    Yield on loans(3) 5.87%  5.10%  4.45%
    Cost of funds 1.59%  0.99%  0.26%
                


     
    Eagle Bancorp, Inc.
    Consolidated Financial Highlights (Continued) (Unaudited)
    (Dollars in thousands)
          
     Three Months Ended
     December 31, September 30, December 31,
     2022 2022 2021
    Capital Ratios     
    Tier 1 capital (to average assets) 11.78%  11.55%  10.19%
    Total capital (to risk weighted assets) 14.99%  15.60%  15.74%
    Common equity tier 1 capital (to risk weighted assets) 14.23%  14.64%  14.63%
    Common equity to total assets 11.02%  11.39%  11.40%
    Tangible common equity ratio(1) 10.18%  10.52%  10.60%
          
    Loan Balances - Period End:     
    Commercial and Industrial$1,487,349  $1,415,998  $1,354,317 
    PPP loans 3,256   7,241   51,105 
    Commercial real estate - income producing 3,919,941   3,668,720   3,385,298 
    Commercial real estate - owner occupied 1,110,325   1,091,283   1,087,776 
    1-4 Family mortgage 73,001   71,731   73,966 
    Construction - commercial and residential 877,755   858,100   896,319 
    Construction - C&I (owner occupied) 110,479   139,238   159,579 
    Home equity 51,782   51,396   55,811 
    Other consumer 1,744   791   1,427 
    Total loans$7,635,632  $7,304,498  $7,065,598 
          
    Average Balances:     
    Total assets$11,255,956  $11,431,110  $12,538,596 
    Total earning assets$10,829,703  $11,030,670  $12,180,872 
    Total loans(3)$7,379,198  $7,282,589  $6,890,414 
    Total deposits$9,524,139  $9,907,497  $10,670,205 
    Total borrowings$411,060  $158,001  $402,393 
    Total shareholders’ equity$1,233,705  $1,271,753  $1,342,525 
          
    Asset Quality:     
    Net charge-off (recovery)$896  $(57) $1,165 
    Nonperforming loans$6,469  $7,602  $29,208 
    Other real estate owned$1,962  $1,962  $1,635 
    Nonperforming assets$8,431  $9,564  $30,843 

    (1) A reconciliation of non-GAAP financial measures to the nearest non-GAAP measure is provided in the tables that accompany this document.
    (2) Computed by dividing noninterest expense by the sum of net interest income and noninterest income. The efficiency ratio measures a bank’s overhead as a percentage of its revenue. 
    (3) Excludes loans held for sale.

     
    GAAP Reconciliation (unaudited)
    (dollars in thousands, except per share data)
          
     December 31, September 30, December 31,
     2022 2022 2021
    Common shareholders' equity$1,228,321  $1,219,771  $1,350,775 
    Less: Intangible assets (104,233)  (104,240)  (105,793)
    Tangible common equity$1,124,088  $1,115,531  $1,244,982 
          
    Book value per common share$39.18  $38.02  $42.28 
    Less: Intangible book value per common share (3.32)  (3.25)  (3.31)
    Tangible book value per common share$35.86  $34.77  $38.97 
          
    Total assets$11,150,854  $10,713,044  $11,847,310 
    Less: Intangible assets (104,233)  (104,240)  (105,793)
    Tangible assets$11,046,621  $10,608,804  $11,741,517 
          
    Tangible common equity ratio 10.18%  10.52%  10.60%
          
    Allowance for credit losses$(74,444) $(75,767) $(74,965)
          
    Total loans, excluding loans held for sale$7,635,632  $7,304,498  $7,065,598 
    Less: PPP loans (non-GAAP) (3,256)  (7,241)  (51,105)
    Total loans excluding PPP loans (non-GAAP)$7,632,376  $7,297,257  $7,014,493 
          
    Allowance for credit losses:     
    As a % of total loans (GAAP) 0.97%  1.04%  1.06%
    As a % of total loans excl. PPP loans (non-GAAP) 0.98%  1.04%  1.07%
          
     Three Months Ended
     December 31, September 30, December 31,
     2022 2022 2021
    Average common shareholders' equity$1,233,705  $1,271,753  $1,342,525 
    Less: Average intangible assets (104,238)  (104,253)  (105,565)
    Average tangible common equity$1,129,467  $1,167,500  $1,236,960 
          
    Net Income$42,193  $37,297  $41,620 
    Return on average tangible common equity(1) 14.82%  12.67%  13.35%
          
    Net interest income$85,600  $83,897  $78,186 
    Noninterest income 5,329   5,308   10,574 
    Operating revenue$90,929  $89,205  $88,760 
    Noninterest expense$38,918  $36,206  $39,309 
    Efficiency ratio 42.8%  40.6%  44.3%

    (1) Periods of less than a year are annualized.

     
    GAAP Reconciliation (unaudited)
    (dollars in thousands, except per share data)
        
     For the Year Ended
     December 31, December 31,
     2022 2021
    Net income$140,930  $176,691 
    Reversal: Accrual reduction(1) (5,018)  — 
    Reversal: Penalty, disgorgement & prejudgment interest(2) 22,874   — 
    Adjusted net income (non-GAAP)$158,786  $176,691 
        
    Earnings per share (diluted)$4.39  $5.52 
    Reversal: Accrual reduction(1) (0.15)  — 
    Reversal: Penalty, disgorgement & prejudgment interest(2) 0.71   — 
    Adjusted earnings per share (diluted) (non-GAAP)$4.95  $5.52 
        
    Weighted average common shares outstanding, diluted 32,078,070   32,003,090 

    (1) Reversal of accrual reduction for non-tax deductible expenses of $5.0 million related to share-based compensation awards and deferred compensation for the Company's former CEO and Chairman, recorded in the first quarter of 2022.
    (2) Reversal of accrual for non-tax deductible expenses of $22.9 million in connection with the Company's agreements in principal with the SEC and FRB to resolve the previously disclosed investigations with respect to the Company, recorded in the second quarter of 2022.

    GAAP Reconciliation (unaudited) - Continued

    Tangible common equity to tangible assets (the "tangible common equity ratio"), tangible book value per common share, and the return on average tangible common equity are non-GAAP financial measures derived from GAAP based amounts. The Company calculates the tangible common equity ratio by excluding the balance of intangible assets from common shareholders' equity and dividing by tangible assets. The Company calculates tangible book value per common share by dividing tangible common equity by common shares outstanding, as compared to book value per common share, which the Company calculates by dividing common shareholders' equity by common shares outstanding. The Company calculates the annualized return on average tangible common equity ratio by dividing net income available to common shareholders by average tangible common equity which is calculated by excluding the average balance of intangible assets from the average common shareholders’ equity. The Company considers this information important to shareholders as tangible equity is a measure that is consistent with the calculation of capital for bank regulatory purposes, which excludes intangible assets from the calculation of risk based ratios and as such is useful for investors, regulators, management and others to evaluate capital adequacy and to compare against other financial institutions. The above table provides reconciliation of these financial measures defined by GAAP with non-GAAP financial measures.

    Pre-provision net revenue is a non-GAAP financial measure derived from GAAP based amounts. The Company calculates PPNR by subtracting noninterest expenses from the sum of net interest income and noninterest income. PPNR to Average Assets is calculated by dividing the PPNR amount by average assets to obtain a percentage. The Company considers this information important to shareholders because it illustrates revenue excluding the impact of provisions and reversals to the allowance for credit losses on loans. The table in the "Income Statement" section of this earnings release provides a reconciliation of PPNR and PPNR to Average Assets to the nearest GAAP measure.

    Total loans excluding PPP loans is a non-GAAP financial measure derived from GAAP based amounts. The Company calculates Total loans excluding PPP loans by subtracting the total amount of outstanding PPP loans from the amount of total loans, excluding loans held for sale. The Company considers this information important to shareholders because it allows investors to see changes in the Company's loan growth without the impact of the PPP loans, which were loan products specific to relief efforts in response to the COVID-19 pandemic. Excluding the impact of PPP loans also allows investors to better compare the Company's loan growth to historical periods prior to the pandemic. The table in the "Balance Sheet" section of this earnings release and the table above provides a reconciliation of total loans excluding PPP loans to the nearest GAAP measure.

    Efficiency ratio is a non-GAAP measure calculated by dividing GAAP non-interest expense by the sum of GAAP net interest income and GAAP non-interest (loss) income. The Company believes that reporting the non-GAAP efficiency ratio more closely measures its effectiveness of controlling operational activities. The table above shows the calculation of the efficiency ratio from these GAAP measures.

    Adjusted net income and adjusted earnings per share (diluted) are non-GAAP financial measures derived from GAAP based amounts.

    • The Company calculates adjusted net income for 2022 by: (1) subtracting from net income the accrual reduction of $5.0 million related to share-based compensation awards and deferred compensation for the Company's former CEO and Chairman, recorded in the first quarter of 2022, and (2) excluding from net income the accrual of non-tax deductible expenses of $22.9 million in connection with the Company's agreements in principle with the Securities and Exchange Commission ("SEC") and the Board of Governors of the Federal Reserve System ("FRB") to resolve the previously disclosed investigations with respect to the Company, recorded in the second quarter of 2022.
    • The Company calculates adjusted earnings per share (diluted) for 2022 by dividing adjusted net income by the weighted average shares outstanding (diluted).
    • The Company considers this information important to shareholders because adjusted net income and adjusted earnings per share (diluted) provides investors insight into how Company earnings changed exclusive of the two aforementioned adjustments, and allows investors to better compare the Company's performance against historical periods. The table above provides a reconciliation of adjusted net income and adjusted earnings per share (diluted) to the nearest GAAP measure.

     
    Eagle Bancorp, Inc.
    Consolidated Balance Sheets (Unaudited)
    (Dollars in thousands, except per share data)
     December 31, September 30, December 31,
    Assets2022 2022 2021
    Cash and due from banks$12,655  $27,235  $12,886 
    Federal funds sold 33,927   69,809   20,391 
    Interest-bearing deposits with banks and other short-term investments 265,272   47,131   1,680,945 
    Investment securities available-for-sale at fair value (amortized cost of $1,803,898 , $1,873,872, and $2,642,667, net of allowance for credit losses of $17, $18 and $620 as of December 31, 2022, September 30, 2022 and December 31, 2021, respectively) 1,598,666   1,649,753   2,623,408 
    Investment securities held-to-maturity (fair value of $1,094,140, $989,001 and $0, net of allowance for credit losses of $766, $802 and $0, as of December 31, 2022, September 30, 2022 and December 31, 2021, respectively) 1,093,374   1,114,084   — 
    Federal Reserve and Federal Home Loan Bank stock 65,067   42,311   34,153 
    Loans held for sale 6,734   9,387   47,218 
    Loans 7,635,632   7,304,498   7,065,598 
    Less allowance for credit losses (74,444)  (75,767)  (74,965)
    Loans, net 7,561,188   7,228,731   6,990,633 
    Premises and equipment, net 13,475   13,684   14,557 
    Operating lease right-of-use assets 24,544   26,022   30,555 
    Deferred income taxes 96,567   112,904   43,174 
    Bank-owned life insurance 110,998   110,678   108,789 
    Goodwill and other intangible assets, net 104,233   104,240   105,793 
    Other real estate owned 1,962   1,962   1,635 
    Other assets 162,192   155,113   133,173 
    Total assets$11,150,854  $10,713,044  $11,847,310 
    Liabilities and Shareholders' Equity     
    Deposits:     
    Noninterest-bearing demand$3,150,751  $2,928,774  $3,277,956 
    Interest-bearing transaction 1,138,235   964,567   777,255 
    Savings and money market 3,640,697   4,220,768   5,197,247 
    Time 783,499   649,241   729,082 
    Total deposits 8,713,182   8,763,350   9,981,540 
    Customer repurchase agreements 35,100   21,465   23,918 
    Other short-term borrowings 975,001   515,000   300,000 
    Long-term borrowings 69,794   69,763   69,670 
    Operating lease liabilities 29,267   30,837   35,501 
    Reserve for unfunded commitments 5,857   5,696   4,379 
    Other liabilities 94,332   87,162   81,527 
    Total liabilities 9,922,533   9,493,273   10,496,535 
    Shareholders' Equity     
    Common stock, par value $.01 per share; shares authorized 100,000,000, shares issued and outstanding 31,346,903, 32,082,321, and 31,950,092 respectively 310   318   316 
    Additional paid-in capital 412,303   442,880   434,640 
    Retained earnings 1,015,215   987,212   930,061 
    Accumulated other comprehensive loss (199,507)  (210,639)  (14,242)
    Total Shareholders' Equity 1,228,321   1,219,771   1,350,775 
    Total Liabilities and Shareholders' Equity$11,150,854  $10,713,044  $11,847,310 
                


     
    Eagle Bancorp, Inc.
    Consolidated Statements of Income (Unaudited)
    (Dollars in thousands, except per share data)
     Three Months Ended Year Ended
     Dec. 31, Sept. 30, Dec. 31, Dec. 31, Dec. 31,
     2022 2022
    		 2021 2022 2021
    Interest Income         
    Interest and fees on loans$109,251  $93,744  $77,625  $358,967  $337,749 
    Interest and dividends on investment securities 13,591   13,463   7,327   51,481   23,205 
    Interest on balances with other banks and short-term invest. 5,696   4,100   1,272   13,304   3,511 
    Interest on federal funds sold 592   220   6   861   31 
    Total interest income 129,130   111,527   86,230   424,613   364,496 
              
    Interest Expense         
    Interest on deposits 39,239   26,125   6,484   83,261   27,772 
    Interest on customer repurchase agreements 266   55   17   356   51 
    Interest on other short-term borrowings 2,988   412   506   3,980   2,008 
    Interest on long-term borrowings 1,037   1,038   1,037   4,149   10,151 
    Total interest expense 43,530   27,630   8,044   91,746   39,982 
    Net Interest Income 85,600   83,897   78,186   332,867   324,514 
    Provision for (Reversal of) Credit Losses (464)  3,022   (6,412)  266   (20,821)
    Provision for (Reversal of) Unfunded Commitments 161   774   (632)  1,477   (1,119)
    Net Interest Income After Provision For Credit Losses 85,903   80,101   85,230   331,124   346,454 
              
    Noninterest Income         
    Service charges on deposits 1,429   1,339   1,259   5,399   4,562 
    Gain on sale of loans 534   821   2,057   3,702   14,045 
    Net gain (loss) on sale of investment securities 3   4   906   (169)  2,964 
    Incr. in the cash surrender value of bank-owned life insurance 658   631   630   2,547   2,059 
    Other income 2,705   2,513   5,722   12,175   16,755 
    Total noninterest income 5,329   5,308   10,574   23,654   40,385 
              
    Noninterest Expense         
    Salaries and employee benefits 23,691   21,538   24,608   84,053   88,398 
    Premises and equipment expenses 3,292   3,275   3,755   13,218   14,876 
    Marketing and advertising 1,290   1,181   1,286   4,721   4,165 
    Data processing 3,117   3,445   3,258   12,171   11,709 
    Legal, accounting and professional fees 2,553   2,332   2,987   8,583   11,510 
    FDIC insurance 1,718   1,287   311   4,969   5,897 
    Other expenses 3,257   3,148   3,104   37,383   12,610 
    Total noninterest expense 38,918   36,206   39,309   165,098   149,165 
    Income Before Income Tax Expense 52,314   49,203   56,495   189,680   237,674 
    Income Tax Expense 10,121   11,906   14,875   48,750   60,983 
    Net Income$42,193  $37,297  $41,620  $140,930  $176,691 
              
    Earnings Per Common Share         
    Basic$1.32  $1.16  $1.30  $4.40  $5.53 
    Diluted$1.32  $1.16  $1.30  $4.39  $5.52 
                        


     
    Eagle Bancorp, Inc.
    Consolidated Average Balances, Interest Yields And Rates vs. Prior Quarter (Unaudited)
    (Dollars in thousands)
                
     Three Months Ended
     December 31, 2022 September 30, 2022
     Average Balance Interest Average
    Yield/Rate    		 Average Balance Interest Average
    Yield/Rate
    ASSETS           
    Interest earning assets:           
    Interest bearing deposits with other banks and other short-term investments$600,653  $5,696  3.76% $771,063  $4,100  2.11%
    Loans held for sale(1) 6,868   102  5.94%  11,586   150  5.18%
    Loans(1) (2) 7,379,198   109,149  5.87%  7,282,589   93,594  5.10%
    Investment securities available-for-sale(2) 1,658,228   7,753  1.85%  1,782,859   7,587  1.69%
    Investment securities held-to-maturity(2) 1,105,209   5,838  2.10%  1,128,943   5,876  2.06%
    Federal funds sold 79,547   592  2.95%  53,630   220  1.63%
    Total interest earning assets 10,829,703  $129,130  4.73%  11,030,670  $111,527  4.01%
    Total noninterest earning assets 501,977       475,581     
    Less: allowance for credit losses 75,724       75,141     
    Total noninterest earning assets 426,253       400,440     
    TOTAL ASSETS$11,255,956      $11,431,110     
                
    LIABILITIES AND SHAREHOLDERS' EQUITY           
    Interest bearing liabilities:           
    Interest bearing transaction$996,951  $3,877  1.54% $960,970  $1,891  0.78%
    Savings and money market 3,963,022   31,571  3.16%  4,504,216   21,711  1.91%
    Time deposits 667,202   3,791  2.25%  633,241   2,523  1.58%
    Total interest bearing deposits 5,627,175   39,239  2.77%  6,098,427   26,125  1.70%
    Customer repurchase agreements 45,521   266  2.32%  26,546   55  0.82%
    Other short-term borrowings 295,756   2,988  4.04%  61,703   412  2.67%
    Long-term borrowings 69,783   1,037  5.94%  69,752   1,038  5.95%
    Total interest bearing liabilities 6,038,235  $43,530  2.86%  6,256,428  $27,630  1.75%
    Noninterest bearing liabilities:           
    Noninterest bearing demand 3,896,964       3,809,070     
    Other liabilities 87,052       93,859     
    Total noninterest bearing liabilities 3,984,016       3,902,929     
    Shareholders’ equity 1,233,705       1,271,753     
    TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$11,255,956      $11,431,110     
    Net interest income  $85,600      $83,897   
                
    Net interest spread    1.87%     2.26%
    Net interest margin    3.14%     3.02%
    Cost of funds    1.59%     0.99%

    (1) Loans placed on nonaccrual status are included in average balances. Net loan fees and late charges included in interest income on loans totaled $3.8 million and $3.4 million for the three months ended December 31, 2022 and September 30, 2022, respectively.
    (2) Interest and fees on loans and investments exclude tax equivalent adjustments.

     
    Eagle Bancorp, Inc.
    Consolidated Average Balances, Interest Yields And Rates vs. Year Ago Quarter (Unaudited)
    (Dollars in thousands)
                
     Three Months Ended December 31,
     2022
    		 2021
     Average Balance Interest Average
    Yield/Rate    		 Average Balance Interest Average
    Yield/Rate
    ASSETS           
    Interest earning assets:           
    Interest bearing deposits with other banks and other short-term investments$600,653  $5,696  3.76% $3,124,657  $1,272  0.16%
    Loans held for sale(1) 6,868   102  5.94%  46,647   342  2.93%
    Loans(1) (2) 7,379,198   109,149  5.87%  6,890,414   77,283  4.45%
    Investment securities available-for-sale(2) 1,658,228   7,753  1.85%  2,088,907   7,327  1.39%
    Investment securities held-to-maturity(2) 1,105,209   5,838  2.10%  —   —  —%
    Federal funds sold 79,547   592  2.95%  30,247   6  0.08%
    Total interest earning assets 10,829,703  $129,130  4.73%  12,180,872  $86,230  2.81%
    Total noninterest earning assets 501,977       440,613     
    Less: allowance for credit losses 75,724       82,889     
    Total noninterest earning assets 426,253       357,724     
    TOTAL ASSETS$11,255,956      $12,538,596     
                
    LIABILITIES AND SHAREHOLDERS' EQUITY           
    Interest bearing liabilities:           
    Interest bearing transaction$996,951  $3,877  1.54% $803,027  $392  0.19%
    Savings and money market 3,963,022   31,571  3.16%  5,257,520   3,688  0.28%
    Time deposits 667,202   3,791  2.25%  735,254   2,404  1.30%
    Total interest bearing deposits 5,627,175   39,239  2.77%  6,795,801   6,484  0.38%
    Customer repurchase agreements 45,521   266  2.32%  32,730   17  0.21%
    Other short-term borrowings 295,756   2,988  4.04%  300,003   506  0.67%
    Long-term borrowings 69,783   1,037  5.94%  69,660   1,037  5.96%
    Total interest bearing liabilities 6,038,235  $43,530  2.86%  7,198,194  $8,044  0.44%
    Noninterest bearing liabilities:           
    Noninterest bearing demand 3,896,964       3,874,405     
    Other liabilities 87,052       123,472     
    Total noninterest bearing liabilities 3,984,016       3,997,877     
    Shareholders’ equity 1,233,705       1,342,525     
    TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY$11,255,956      $12,538,596     
    Net interest income  $85,600      $78,186   
                
    Net interest spread    1.87%     2.37%
    Net interest margin    3.14%     2.55%
    Cost of funds    1.59%     0.26%

    (1) Loans placed on nonaccrual status are included in average balances. Net loan fees and late charges included in interest income on loans totaled $3.8 million and $4.3 million for the three months ended December 31, 2022 and December 31, 2021, respectively.
    (2) Interest and fees on loans and investments exclude tax equivalent adjustments.

     
    Eagle Bancorp, Inc.
    Statements of Income and Highlights Quarterly Trends (Unaudited)
    (Dollars in thousands, except per share data)
                    
     Three Months Ended
     December 31, September 30, June 30, March 31, December 31, September 30, June 30, March 31,
    Income Statements:2022 2022 2022 2022 2021 2021 2021 2021
    Total interest income$129,130  $111,527  $95,635  $88,321  $86,230  $89,152  $94,920  $94,194 
    Total interest expense 43,530   27,630   12,717   7,869   8,044   10,107   10,288   11,543 
    Net interest income 85,600   83,897   82,918   80,452   78,186   79,045   84,632   82,651 
    Provision for (reversal of) credit losses (464)  3,022   495   (2,787)  (6,412)  (8,203)  (3,856)  (2,350)
    Provision for (reversal of) unfunded commitments 161   774   553   (11)  (632)  716   (761)  (442)
    Net interest income after provision for credit losses 85,903   80,101   81,870   83,250   85,230   86,532   89,249   85,443 
    Noninterest income before investment gain (loss) 5,326   5,304   5,715   7,478   9,668   6,780   10,607   10,366 
    Net gain (loss) on sale of investment securities 3   4   (151)  (25)  906   1,519   318   221 
    Total noninterest income 5,329   5,308   5,564   7,453   10,574   8,299   10,925   10,587 
    Salaries and employee benefits 23,691   21,538   21,805   17,019   24,608   22,145   19,876   21,769 
    Premises and equipment 3,292   3,275   3,523   3,128   3,755   3,859   3,644   3,618 
    Marketing and advertising 1,290   1,181   1,186   1,064   1,286   1,013   980   886 
    Other expenses 10,645   10,212   32,448   9,801   9,660   9,358   10,994   11,714 
    Total noninterest expense 38,918   36,206   58,962   31,012   39,309   36,375   35,494   37,987 
    Income before income tax expense 52,314   49,203   28,472   59,691   56,495   58,456   64,680   58,043 
    Income tax expense 10,121   11,906   12,776   13,947   14,875   14,847   16,687   14,574 
    Net income$42,193  $37,297  $15,696  $45,744  $41,620  $43,609  $47,993  $43,469 
    Per Share Data:               
    Earnings per weighted average common share, basic$1.32  $1.16  $0.49  $1.43  $1.30  $1.36  $1.50  $1.36 
    Earnings per weighted average common share, diluted$1.32  $1.16  $0.49  $1.42  $1.30  $1.36  $1.50  $1.36 
    Weighted average common shares outstanding, basic 31,819,631   32,084,464   32,080,657   32,033,280   31,950,320   31,959,357   31,962,819   31,869,655 
    Weighted average common shares outstanding, diluted 31,898,619   32,155,678   32,142,427   32,110,099   32,030,998   32,030,527   32,025,110   31,922,940 
    Actual shares outstanding at period end 31,346,903   32,082,321   32,081,241   32,079,474   31,950,092   31,947,458   31,961,573   31,960,379 
    Book value per common share at period end$39.18  $38.02  $39.05  $39.89  $42.28  $41.68  $40.87  $39.45 
    Tangible book value per common share at period end(1)$35.86  $34.77  $35.80  $36.64  $38.97  $38.39  $37.58  $36.16 
    Dividend per common share$0.45  $0.45  $0.45  $0.40  $0.40  $0.40  $0.35  $0.25 
    Performance Ratios (annualized):               
    Return on average assets 1.49%  1.29%  0.54%  1.46%  1.32%  1.46%  1.68%  1.53%
    Return on average common equity 13.57%  11.64%  4.91%  13.83%  12.30%  13.00%  14.92%  14.05%
    Return on average tangible common equity(1) 14.82%  12.67%  5.35%  14.99%  13.35%  14.11%  16.25%  15.33%
    Net interest margin 3.14%  3.02%  2.94%  2.65%  2.55%  2.73%  3.04%  2.98%
    Efficiency ratio(2) 42.80%  40.6%  66.6%  35.3%  44.3%  41.7%  37.1%  40.7%
    Other Ratios:               
    Allowance for credit losses to total loans(3) 0.97%  1.04%  1.02%  1.01%  1.06%  1.21%  1.28%  1.36%
    Allowance for credit losses to total nonperforming loans 1,151%  997%  386%  301%  257%  265%  187%  195%
    Nonperforming loans to total loans(3) 0.08%  0.10%  0.26%  0.33%  0.41%  0.46%  0.68%  0.69%
    Nonperforming assets to total assets 0.08%  0.09%  0.19%  0.23%  0.26%  0.31%  0.50%  0.51%
    Net charge-off (recovery)(annualized) to average total loans(3) 0.05%  —% (0.04)%  0.03%  0.07%  0.08%  0.30%  0.27%
    Tier 1 capital (to average assets) 11.78%  11.55%  10.68%  9.93%  10.19%  10.58%  10.65%  10.28%
    Total capital (to risk weighted assets) 14.99%  15.60%  15.14%  15.21%  15.74%  16.18%  17.44%  17.50%
    Common equity tier 1 capital (to risk weighted assets) 14.23%  14.64%  14.06%  14.12%  14.63%  14.95%  14.24%  14.12%
    Tangible common equity ratio(1) 10.18%  10.52%  10.60%  10.57%  10.60%  10.68%  11.07%  10.48%
    Average Balances (in thousands):               
    Total assets$11,255,956  $11,431,110  $11,701,679  $12,701,152  $12,538,596  $11,826,326  $11,453,080  $11,517,836 
    Total earning assets$10,829,703  $11,030,670  $11,300,267  $12,326,473  $12,180,872  $11,486,280  $11,152,933  $11,236,440 
    Total loans(3)$7,379,198  $7,282,589  $7,104,727  $7,053,701  $6,890,414  $7,055,621  $7,382,238  $7,726,716 
    Total deposits$9,524,139  $9,907,497  $10,184,886  $10,874,976  $10,670,206  $9,948,114  $9,530,909  $9,601,249 
    Total borrowings$411,060  $158,001  $152,583  $371,987  $402,393  $448,697  $536,926  $573,750 
    Total shareholders’ equity$1,233,705  $1,271,753  $1,281,742  $1,341,785  $1,342,525  $1,331,022  $1,290,029  $1,254,780 

    (1) A reconciliation of non-GAAP financial measures to the nearest non-GAAP measure is provided in the tables that accompany this document.
    (2) Computed by dividing noninterest expense by the sum of net interest income and noninterest income.
    (3) Excludes loans held for sale.

    CONTACT:
    David G. Danielson
    240.552.9534


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