• First Hawaiian, Inc. Reports Third Quarter 2022 Financial Results and Declares Dividend

    Source: Nasdaq GlobeNewswire / 28 Oct 2022 07:00:02   America/Chicago

    HONOLULU, Oct. 28, 2022 (GLOBE NEWSWIRE) -- First Hawaiian, Inc. (NASDAQ:FHB), (“First Hawaiian” or the “Company”) today reported financial results for its quarter ended September 30, 2022.

    “I’m pleased to report that we had a very strong third quarter, as net income increased by over 16% from the prior quarter,” said Bob Harrison, Chairman, President and CEO. “We had robust loan growth and credit quality remained excellent.”

    On October 26, 2022, the Company’s Board of Directors declared a quarterly cash dividend of $0.26 per share. The dividend will be payable on December 2, 2022, to stockholders of record at the close of business on November 21, 2022.

    Third Quarter 2022 Highlights:

    • Net income of $69.0 million, or $0.54 per diluted share
    • Total loans and leases increased $437.6 million versus prior quarter
    • Total deposits decreased $509.7 million versus prior quarter
    • Net interest margin increased 33 basis points to 2.93%
    • Recorded a $3.2 million provision for credit losses
    • Board of Directors declared a quarterly dividend of $0.26 per share

    Balance Sheet
    Total assets were $24.9 billion as of September 30, 2022, compared to $25.4 billion as of June 30, 2022.

    Gross loans and leases were $13.7 billion as of September 30, 2022, an increase of $437.6 million, or 3.3%, from $13.3 billion as of June 30, 2022.

    Total deposits were $22.1 billion as of September 30, 2022, a decrease of $509.7 million, or 2.3%, from $22.6 billion as of June 30, 2022.

    Net Interest Income
    Net interest income for the third quarter of 2022 was $162.7 million, an increase of $17.6 million, or 12.1%, compared to $145.1 million for the prior quarter.

    The net interest margin was 2.93% in the third quarter of 2022, an increase of 33 basis points compared to 2.60% in the prior quarter.

    Provision Expense
    During the quarter ended September 30, 2022, we recorded a $3.2 million provision for credit losses. In the quarter ended June 30, 2022, we recorded a $1.0 million provision for credit losses.

    Noninterest Income
    Noninterest income was $45.9 million in the third quarter of 2022, an increase of $1.7 million compared to noninterest income of $44.1 million in the prior quarter.

    Noninterest Expense
    Noninterest expense was $113.3 million in the third quarter of 2022, an increase of $4.2 million compared to noninterest expense of $109.2 million in the prior quarter.

    The efficiency ratio was 54.0% and 57.3% for the quarters ended September 30, 2022 and June 30, 2022, respectively.

    Taxes
    The effective tax rate was 25.0% for the quarters ended September 30, 2022 and June 30, 2022.

    Asset Quality
    The allowance for credit losses was $148.2 million, or 1.08% of total loans and leases, as of September 30, 2022, compared to $148.9 million, or 1.12% of total loans and leases, as of June 30, 2022. The reserve for unfunded commitments was $30.1 million as of September 30, 2022, compared to $29.0 million as of June 30, 2022. Net charge-offs were $2.8 million, or 0.08% of average loans and leases on an annualized basis, for the quarter ended September 30, 2022, compared to net charge-offs of $2.3 million, or 0.07% of average loans and leases on an annualized basis, for the quarter ended June 30, 2022. Total non-performing assets were $8.4 million, or 0.06% of total loans and leases and other real estate owned, on September 30, 2022, compared to total non-performing assets of $7.9 million, or 0.06% of total loans and leases and other real estate owned, on June 30, 2022.

    Capital
    Total stockholders’ equity was $2.2 billion on September 30, 2022 compared to $2.3 billion on June 30, 2022.

    The tier 1 leverage, common equity tier 1 and total capital ratios were 7.78%, 11.79%, and 12.92%, respectively, on September 30, 2022, compared with 7.54%, 11.98%, and 13.14%, respectively, on June 30, 2022.

    The Company repurchased 0.1 million shares of common stock at a total cost of $2.5 million under the stock repurchase program in the third quarter. The average cost was $23.24 per share repurchased. Remaining buyback authority under the stock repurchase program was $65.5 million on September 30, 2022.

    First Hawaiian, Inc.
    First Hawaiian, Inc. (NASDAQ:FHB) is a bank holding company headquartered in Honolulu, Hawaii. Its principal subsidiary, First Hawaiian Bank, founded in 1858 under the name Bishop & Company, is Hawaii’s oldest and largest financial institution with branch locations throughout Hawaii, Guam and Saipan. The company offers a comprehensive suite of banking services to consumer and commercial customers including deposit products, loans, wealth management, insurance, trust, retirement planning, credit card and merchant processing services. Customers may also access their accounts through ATMs, online and mobile banking channels. For more information about First Hawaiian, Inc., visit the Company’s website, www.fhb.com.

    Conference Call Information

    First Hawaiian will host a conference call to discuss the Company’s results today at 1:00 p.m. Eastern Time, 7:00 a.m. Hawaii Time.

    Please note that the process for accessing the conference call has changed. Participants will need to click on the registration link provided below, register for the conference call, and then you will receive the dial-in number and a personalized PIN code.

    To access the call by phone, please register via the following link: https://register.vevent.com/register/BIefa7fae07c09405291195a9acfdb68b6, and you will be provided with dial in details. To avoid delays, we encourage participants to dial into the conference call fifteen minutes ahead of the scheduled start time.

    A live webcast of the conference call, including a slide presentation, will be available at the following link: www.fhb.com/earnings. The archive of the webcast will be available at the same location.

    Forward-Looking Statements
    This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. These statements are often, but not always, made through the use of words or phrases such as “may”, “might”, “should”, “could”, “predict”, “potential”, “believe”, “expect”, “continue”, “will”, “anticipate”, “seek”, “estimate”, “intend”, “plan”, “projection”, “would”, “annualized” and “outlook”, or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, estimates and uncertainties that are difficult to predict. Further, statements about the potential effects of the COVID-19 pandemic on our businesses and financial results and conditions may constitute forward-looking statements and are subject to the risk that the actual effects may differ, possibly materially, from what is reflected in those forward-looking statements due to factors and future developments that are uncertain, unpredictable and in many cases beyond our control, including the scope and duration of the pandemic, actions taken by governmental authorities in response to the pandemic, and the direct and indirect impact of the pandemic on our customers, third parties and us. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, there can be no assurance that actual results will not prove to be materially different from the results expressed or implied by the forward-looking statements. A number of important factors could cause actual results or performance to differ materially from the forward-looking statements, including (without limitation) the risks and uncertainties associated with the ongoing impacts of COVID-19, the domestic and global economic environment and capital market conditions and other risk factors. For a discussion of some of these risks and important factors that could affect our future results and financial condition, see our U.S. Securities and Exchange Commission (“SEC”) filings, including, but not limited to, our Annual Report on Form 10-K for the year ended December 31, 2021 and our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2022 and June 30, 2022.

    Use of Non-GAAP Financial Measures
    Return on average tangible assets, return on average tangible stockholders’ equity, tangible book value per share and tangible stockholders’ equity to tangible assets are non-GAAP financial measures. We believe that these measurements are useful for investors, regulators, management and others to evaluate financial performance and capital adequacy relative to other financial institutions. Although these non-GAAP financial measures are frequently used by stakeholders in the evaluation of a company, they have limitations as analytical tools and should not be considered in isolation or as a substitute for analysis of our results or financial condition as reported under GAAP. Investors should consider our performance and capital adequacy as reported under GAAP and all other relevant information when assessing our performance and capital adequacy.

    Table 14 at the end of this document provides a reconciliation of these non-GAAP financial measures with their most directly comparable GAAP measures.

    Investor Relations Contact:
    Kevin Haseyama, CFA
    (808) 525-6268
    khaseyama@fhb.com

    Media Contact:
    Lindsay Chambers
    (808) 525-6254
    lchambers@fhb.com


                    
    Financial Highlights Table 1
     
      For the Three Months Ended For the Nine Months Ended
      September 30,  June 30,  September 30,  September 30, 
    (dollars in thousands, except per share data) 2022 2022 2021
     2022
     2021
    Operating Results:               
    Net interest income $ 162,736 $145,147 $132,593  $ 441,755  $393,232 
    Provision for credit losses   3,183  1,000  (4,000)   (1,564)  (39,000)
    Noninterest income   45,857  44,137  50,104    131,374   143,343 
    Noninterest expense   113,332  109,175  101,036    326,549   296,730 
    Net income   69,018  59,360  64,279    186,097   208,713 
    Basic earnings per share   0.54  0.46  0.50    1.46   1.61 
    Diluted earnings per share   0.54  0.46  0.50    1.45   1.61 
    Dividends declared per share   0.26  0.26  0.26    0.78   0.78 
    Dividend payout ratio   48.15% 56.52% 52.00%   53.79%  48.45%
    Performance Ratios(1):               
    Net interest margin   2.93% 2.60% 2.36%  2.65%  2.45%
    Efficiency ratio   53.98% 57.33% 55.07%  56.63%  55.10%
    Return on average total assets   1.10% 0.94% 1.02%  0.99%  1.16%
    Return on average tangible assets (non-GAAP)(2)   1.14% 0.98% 1.06%  1.03%  1.21%
    Return on average total stockholders’ equity   12.08% 10.52% 9.31%  10.55%  10.26%
    Return on average tangible stockholders’ equity (non-GAAP)(2)   21.53% 18.79% 14.63%  18.26%  16.19%
    Average Balances:               
    Average loans and leases $ 13,491,428 $13,058,558 $12,881,885  $ 13,125,660  $13,108,427 
    Average earning assets   22,258,066  22,520,605  22,533,174    22,413,209   21,523,731 
    Average assets   24,957,042  25,250,176  25,058,085    25,095,438   24,013,691 
    Average deposits   22,148,039  22,401,558  21,621,836    22,170,824   20,595,400 
    Average stockholders’ equity   2,267,152  2,262,654  2,738,540    2,358,195   2,719,442 
    Market Value Per Share:               
    Closing   24.63  22.71  29.35    24.63   29.35 
    High   28.14  28.44  30.06    31.16   30.80 
    Low   21.21  21.49  25.75    21.21   23.14 


                  
      As of As of As of As of 
      September 30,  June 30,  December 31,  September 30,  
    (dollars in thousands, except per share data) 2022 2022 2021 2021 
    Balance Sheet Data:             
    Loans and leases $ 13,700,374 $13,262,781 $12,961,999 $12,834,339 
    Total assets   24,870,272  25,377,533  24,992,410  25,548,322 
    Total deposits   22,091,738  22,601,454  21,816,146  22,120,003 
    Long-term borrowings        200,000 
    Total stockholders’ equity   2,200,651  2,252,611  2,656,912  2,711,734 
                  
    Per Share of Common Stock:             
    Book value $ 17.28 $17.67 $20.84 $21.14 
    Tangible book value (non-GAAP)(2)   9.46  9.86  13.03  13.38 
                  
    Asset Quality Ratios:             
    Non-accrual loans and leases / total loans and leases  0.06% 0.06% 0.05% 0.07%
    Allowance for credit losses for loans and leases / total loans and leases  1.08% 1.12% 1.21% 1.26%
                  
    Capital Ratios:             
    Common Equity Tier 1 Capital Ratio  11.79% 11.98% 12.24% 12.63%
    Tier 1 Capital Ratio  11.79% 11.98% 12.24% 12.63%
    Total Capital Ratio  12.92% 13.14% 13.49% 13.88%
    Tier 1 Leverage Ratio  7.78% 7.54% 7.24% 7.39%
    Total stockholders’ equity to total assets  8.85% 8.88% 10.63% 10.61%
    Tangible stockholders’ equity to tangible assets (non-GAAP)(2)  5.05% 5.16% 6.92% 6.99%
                  
    Non-Financial Data:             
    Number of branches  51  51  54  54 
    Number of ATMs  303  297  299  298 
    Number of Full-Time Equivalent Employees  2,042  2,021  2,036  2,025 

    (1)  Except for the efficiency ratio, amounts are annualized for the three and nine months ended September 30, 2022 and 2021 and the three months ended June 30, 2022.

    (2)  Return on average tangible assets, return on average tangible stockholders’ equity, tangible book value per share and tangible stockholders’ equity to tangible assets are non-GAAP financial measures. We compute our return on average tangible assets as the ratio of net income to average tangible assets, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total assets. We compute our return on average tangible stockholders’ equity as the ratio of net income to average tangible stockholders’ equity, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total stockholders’ equity. We compute our tangible book value per share as the ratio of tangible stockholders’ equity to outstanding shares. Tangible stockholders’ equity is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our total stockholders’ equity. We compute our tangible stockholders’ equity to tangible assets as the ratio of tangible stockholders’ equity to tangible assets, each of which we calculate by subtracting (and thereby effectively excluding) the value of our goodwill. For a reconciliation to the most directly comparable GAAP financial measure, see Table 14, GAAP to Non-GAAP Reconciliation.


                    
    Consolidated Statements of Income Table 2
     
      For the Three Months Ended For the Nine Months Ended
      September 30,  June 30,  September 30,  September 30, 
    (dollars in thousands, except per share amounts) 2022
     2022
     2021
     2022
     2021
    Interest income               
    Loans and lease financing $ 134,646  $111,916  $110,765  $ 350,294  $332,623 
    Available-for-sale investment securities   19,644   16,643   25,234    68,394   73,017 
    Held-to-maturity investment securities   17,950   18,289       36,239    
    Other   4,150   2,896   1,205    7,828   2,362 
    Total interest income   176,390   149,744   137,204    462,755   408,002 
    Interest expense               
    Deposits   13,653   4,597   3,218    20,999   10,637 
    Short-term and long-term borrowings   1      1,393    1   4,133 
    Total interest expense   13,654   4,597   4,611    21,000   14,770 
    Net interest income   162,736   145,147   132,593    441,755   393,232 
    Provision for credit losses   3,183   1,000   (4,000)   (1,564)  (39,000)
    Net interest income after provision for credit losses   159,553   144,147   136,593    443,319   432,232 
    Noninterest income               
    Service charges on deposit accounts   7,089   6,843   6,989    21,433   20,339 
    Credit and debit card fees   17,746   17,056   16,017    49,652   47,314 
    Other service charges and fees   9,179   9,018   10,233    27,851   29,382 
    Trust and investment services income   9,800   8,759   8,625    27,442   25,824 
    Bank-owned life insurance   (341)  (859)  4,841    (1,617)  10,334 
    Investment securities gains, net              102 
    Other   2,384   3,320   3,399    6,613   10,048 
    Total noninterest income   45,857   44,137   50,104    131,374   143,343 
    Noninterest expense               
    Salaries and employee benefits   51,372   49,902   46,484    149,500   136,402 
    Contracted services and professional fees   16,625   18,617   15,042    52,389   48,746 
    Occupancy   8,115   7,334   6,790    22,859   21,274 
    Equipment   10,791   7,754   6,549    24,522   18,402 
    Regulatory assessment and fees   2,487   2,301   1,828    7,012   5,688 
    Advertising and marketing   1,902   1,994   1,469    5,924   4,529 
    Card rewards program   8,141   7,285   6,676    22,309   17,773 
    Other   13,899   13,988   16,198    42,034   43,916 
    Total noninterest expense   113,332   109,175   101,036    326,549   296,730 
    Income before provision for income taxes   92,078   79,109   85,661    248,144   278,845 
    Provision for income taxes   23,060   19,749   21,382    62,047   70,132 
    Net income $ 69,018  $59,360  $64,279  $ 186,097  $208,713 
    Basic earnings per share $ 0.54  $0.46  $0.50  $ 1.46  $1.61 
    Diluted earnings per share $ 0.54  $0.46  $0.50  $ 1.45  $1.61 
    Basic weighted-average outstanding shares   127,377,713   127,672,244   128,660,038    127,534,746   129,323,973 
    Diluted weighted-average outstanding shares   127,796,617   128,014,777   129,210,448    127,996,672   129,895,311 


                 
    Consolidated Balance Sheets Table 3
     
      September 30,  June 30,  December 31,  September 30, 
    (dollars in thousands) 2022
     2022
     2021
     2021
    Assets            
    Cash and due from banks $ 291,360  $279,629  $246,716  $268,467 
    Interest-bearing deposits in other banks   657,574   1,254,047   1,011,753   2,130,615 
    Investment securities:            
    Available-for-sale, at fair value (amortized cost: $3,673,396 as of September 30, 2022, $4,267,809 as of June 30, 2022, $8,560,733 as of December 31, 2021 and $7,994,266 as of September 30, 2021)   3,289,160   3,967,746   8,428,032   7,953,727 
    Held-to-maturity, at amortized cost (fair value: $3,960,713 as of September 30, 2022, $3,910,780 as of June 30, 2022 and nil as of December 31, 2021 and September 30, 2021)   4,406,143   4,093,215       
    Loans held for sale   361   180   538   2,052 
    Loans and leases   13,700,374   13,262,781   12,961,999   12,834,339 
    Less: allowance for credit losses   148,163   148,942   157,262   161,246 
    Net loans and leases   13,552,211   13,113,839   12,804,737   12,673,093 
                 
    Premises and equipment, net   299,179   310,047   318,448   317,272 
    Other real estate owned and repossessed personal property   139      175    
    Accrued interest receivable   68,545   63,240   63,158   64,855 
    Bank-owned life insurance   470,202   470,542   471,819   468,968 
    Goodwill   995,492   995,492   995,492   995,492 
    Mortgage servicing rights   6,866   7,152   8,302   9,107 
    Other assets   833,040   822,404   643,240   664,674 
    Total assets $ 24,870,272  $25,377,533  $24,992,410  $25,548,322 
    Liabilities and Stockholders’ Equity            
    Deposits:            
    Interest-bearing $ 12,774,645  $12,990,571  $12,422,283  $13,246,579 
    Noninterest-bearing   9,317,093   9,610,883   9,393,863   8,873,424 
    Total deposits   22,091,738   22,601,454   21,816,146   22,120,003 
    Long-term borrowings           200,000 
    Retirement benefits payable   133,981   134,151   134,491   144,400 
    Other liabilities   443,902   389,317   384,861   372,185 
    Total liabilities   22,669,621   23,124,922   22,335,498   22,836,588 
                 
    Stockholders’ equity            
    Common stock ($0.01 par value; authorized 300,000,000 shares; issued/outstanding: 140,958,520 / 127,357,680 shares as of September 30, 2022, issued/outstanding: 140,943,908 / 127,451,087 shares as of June 30, 2022, issued/outstanding: 140,581,715 / 127,502,472 shares as of December 31, 2021 and issued/outstanding: 140,563,799 / 128,255,570 shares as of September 30, 2021)   1,410   1,409   1,406   1,406 
    Additional paid-in capital   2,535,601   2,533,407   2,527,663   2,524,168 
    Retained earnings   690,433   654,777   604,534   581,094 
    Accumulated other comprehensive loss, net   (658,756)  (571,457)  (121,693)  (61,463)
    Treasury stock (13,600,840 shares as of September 30, 2022, 13,492,821 shares as of June 30, 2022, 13,079,243 shares as of December 31, 2021 and 12,308,229 shares as of September 30, 2021)   (368,037)  (365,525)  (354,998)  (333,471)
    Total stockholders’ equity   2,200,651   2,252,611   2,656,912   2,711,734 
    Total liabilities and stockholders’ equity $ 24,870,272  $25,377,533  $24,992,410  $25,548,322 


                              
    Average Balances and Interest Rates                       Table 4 
      Three Months Ended  Three Months Ended  Three Months Ended  
      September 30, 2022 June 30, 2022 September 30, 2021 
      Average Income/ Yield/ Average Income/ Yield/ Average Income/ Yield/ 
    (dollars in millions) Balance Expense Rate Balance Expense Rate Balance Expense Rate 
    Earning Assets                         
    Interest-Bearing Deposits in Other Banks $ 724.0 $ 4.0  2.20%$1,297.3 $2.8 0.85%$2,356.4 $0.9 0.16%
    Available-for-Sale Investment Securities                         
    Taxable   3,733.8   19.2  2.05  3,946.4  16.6 1.68  6,654.6  22.9 1.37 
    Non-Taxable   45.1   0.6  5.16  8.4  0.1 5.26  561.1  2.9 2.11 
    Held-to-Maturity Investment Securities                         
    Taxable   3,573.6   14.6  1.64  3,533.6  15.0 1.70      
    Non-Taxable   613.6   4.2  2.72  607.0  4.1 2.71      
    Total Investment Securities   7,966.1   38.6  1.93  8,095.4  35.8 1.77  7,215.7  25.8 1.43 
    Loans Held for Sale   0.7    3.62  0.3   5.06  2.2   2.39 
    Loans and Leases(1)                         
    Commercial and industrial   2,025.5   20.7  4.05  1,951.3  15.0 3.09  2,367.2  19.7 3.29 
    Commercial real estate   4,016.7   42.3  4.18  3,808.9  30.7 3.23  3,447.0  25.4 2.92 
    Construction   737.4   8.6  4.63  711.3  6.3 3.57  862.4  7.0 3.24 
    Residential:                         
    Residential mortgage   4,224.0   36.4  3.45  4,183.0  36.7 3.51  3,866.1  34.6 3.58 
    Home equity line   991.1   7.2  2.87  945.7  5.9 2.49  837.7  5.5 2.62 
    Consumer   1,218.0   17.1  5.57  1,218.0  15.5 5.09  1,260.2  16.8 5.28 
    Lease financing   278.7   2.7  3.81  240.4  2.1 3.53  241.3  2.0 3.23 
    Total Loans and Leases   13,491.4   135.0  3.98  13,058.6  112.2 3.44  12,881.9  111.0 3.43 
    Other Earning Assets   75.9   0.1  0.69  69.0  0.1 0.79  77.0  0.3 1.34 
    Total Earning Assets(2)   22,258.1   177.7  3.18  22,520.6  150.9 2.68  22,533.2  138.0 2.44 
    Cash and Due from Banks   277.0       300.8       290.5      
    Other Assets   2,421.9       2,428.8       2,234.4      
    Total Assets $ 24,957.0      $25,250.2      $25,058.1      
                              
    Interest-Bearing Liabilities                         
    Interest-Bearing Deposits                         
    Savings $ 6,871.5 $ 6.7  0.39%$6,971.3 $1.7 0.10% 6,886.0 $0.6 0.03%
    Money Market   4,086.1   4.8  0.47  4,127.4  1.4 0.14  3,957.1  0.5 0.05 
    Time   1,720.5   2.1  0.48  1,671.4  1.5 0.36  1,884.4  2.1 0.45 
    Total Interest-Bearing Deposits   12,678.1   13.6  0.43  12,770.1  4.6 0.14  12,727.5  3.2 0.10 
    Federal Funds Purchased   0.2    1.67           
    Long-Term Borrowings            200.0  1.4 2.76 
    Total Interest-Bearing Liabilities   12,678.3   13.6  0.43  12,770.1  4.6 0.14  12,927.5  4.6 0.14 
    Net Interest Income    $ 164.1      $146.3      $133.4   
    Interest Rate Spread        2.75%      2.54%      2.30%
    Net Interest Margin        2.93%      2.60%      2.36%
    Noninterest-Bearing Demand Deposits   9,469.9       9,631.4       8,894.3      
    Other Liabilities   541.6       586.0       497.7      
    Stockholders’ Equity   2,267.2       2,262.7       2,738.6      
    Total Liabilities and Stockholders’ Equity $ 24,957.0      $25,250.2      $25,058.1      

    (1)  Non-performing loans and leases are included in the respective average loan and lease balances. Income, if any, on such loans and leases is recognized on a cash basis.

    (2)  Interest income includes taxable-equivalent basis adjustments of $1.3 million, $1.2 million and $0.8 million for the three months ended September 30, 2022, June 30, 2022, and September 30, 2021, respectively.


                      
    Average Balances and Interest Rates               Table 5 
      Nine Months Ended  Nine Months Ended  
      September 30, 2022 September 30, 2021 
      Average Income/ Yield/ Average Income/ Yield/ 
    (dollars in millions) Balance Expense Rate Balance Expense Rate 
    Earning Assets                 
    Interest-Bearing Deposits in Other Banks $ 1,051.7 $ 7.3  0.93%$1,604.6 $1.5 0.13%
    Available-for-Sale Investment Securities                 
    Taxable   5,145.3   64.9  1.68  6,303.5  67.5 1.43 
    Non-Taxable   227.9   4.4  2.59  436.9  6.9 2.11 
    Held-to-Maturity Investment Securities                 
    Taxable   2,382.2   29.7  1.66      
    Non-Taxable   409.1   8.3  2.71      
    Total Investment Securities   8,164.5   107.3  1.75  6,740.4  74.4 1.47 
    Loans Held for Sale   0.7    2.92  4.4  0.1 2.31 
    Loans and Leases(1)                 
    Commercial and industrial   1,983.5   50.3  3.39  2,756.2  61.2 2.97 
    Commercial real estate   3,820.6   98.8  3.46  3,417.5  75.6 2.96 
    Construction   738.4   20.7  3.74  803.8  19.2 3.19 
    Residential:                 
    Residential mortgage   4,173.1   108.0  3.45  3,776.5  103.3 3.65 
    Home equity line   943.2   18.5  2.62  824.1  16.7 2.71 
    Consumer   1,218.2   48.1  5.29  1,287.1  51.4 5.34 
    Lease financing   248.7   6.7  3.60  243.2  5.7 3.10 
    Total Loans and Leases   13,125.7   351.1  3.57  13,108.4  333.1 3.39 
    Other Earning Assets   70.6   0.5  0.92  65.9  0.8 1.65 
    Total Earning Assets(2)   22,413.2   466.2  2.78  21,523.7  409.9 2.54 
    Cash and Due from Banks   289.9       291.7      
    Other Assets   2,392.3       2,198.3      
    Total Assets $ 25,095.4      $24,013.7      
                      
    Interest-Bearing Liabilities                 
    Interest-Bearing Deposits                 
    Savings $ 6,837.8 $ 8.9  0.17%$6,410.9 $1.7 0.04%
    Money Market   4,087.6   6.8  0.22  3,758.3  1.5 0.05 
    Time   1,713.4   5.3  0.41  2,067.7  7.4 0.48 
    Total Interest-Bearing Deposits   12,638.8   21.0  0.22  12,236.9  10.6 0.12 
    Federal Funds Purchased   0.1    1.67      
    Long-Term Borrowings       200.0  4.2 2.76 
    Total Interest-Bearing Liabilities   12,638.9   21.0  0.22  12,436.9  14.8 0.16 
    Net Interest Income    $ 445.2      $395.1   
    Interest Rate Spread        2.56%      2.38%
    Net Interest Margin        2.65%      2.45%
    Noninterest-Bearing Demand Deposits   9,532.0       8,358.5      
    Other Liabilities   566.3       498.9      
    Stockholders’ Equity   2,358.2       2,719.4      
    Total Liabilities and Stockholders’ Equity $ 25,095.4      $24,013.7      

    (1)  Non-performing loans and leases are included in the respective average loan and lease balances. Income, if any, on such loans and leases is recognized on a cash basis.

    (2)  Interest income includes taxable-equivalent basis adjustments of $3.5 million and $1.9 million for the nine months ended September 30, 2022 and 2021, respectively.


              
    Analysis of Change in Net Interest Income        Table 6 
      Three Months Ended September 30, 2022
      Compared to June 30, 2022
    (dollars in millions) Volume Rate Total
    Change in Interest Income:         
    Interest-Bearing Deposits in Other Banks $ (1.7) $ 2.9  $ 1.2 
    Available-for-Sale Investment Securities         
    Taxable   (0.9)   3.5    2.6 
    Non-Taxable   0.5       0.5 
    Held-to-Maturity Investment Securities         
    Taxable   0.2    (0.6)   (0.4)
    Non-Taxable   0.1       0.1 
    Total Investment Securities   (0.1)   2.9    2.8 
    Loans and Leases         
    Commercial and industrial   0.6    5.1    5.7 
    Commercial real estate   1.8    9.8    11.6 
    Construction   0.3    2.0    2.3 
    Residential:         
    Residential mortgage   0.3    (0.6)   (0.3)
    Home equity line   0.3    1.0    1.3 
    Consumer      1.6    1.6 
    Lease financing   0.4    0.2    0.6 
    Total Loans and Leases   3.7    19.1    22.8 
    Total Change in Interest Income   1.9    24.9    26.8 
              
    Change in Interest Expense:         
    Interest-Bearing Deposits         
    Savings      5.0    5.0 
    Money Market      3.4    3.4 
    Time      0.6    0.6 
    Total Interest-Bearing Deposits      9.0    9.0 
    Total Change in Interest Expense      9.0    9.0 
    Change in Net Interest Income $ 1.9  $ 15.9  $ 17.8 


              
    Analysis of Change in Net Interest Income        Table 7 
      Three Months Ended September 30, 2022
      Compared to September 30, 2021
    (dollars in millions) Volume Rate Total
    Change in Interest Income:         
    Interest-Bearing Deposits in Other Banks $ (1.1) $ 4.2  $ 3.1 
    Available-for-Sale Investment Securities         
    Taxable   (12.4)   8.7    (3.7)
    Non-Taxable   (4.2)   1.9    (2.3)
    Held-to-Maturity Investment Securities         
    Taxable   14.6       14.6 
    Non-Taxable   4.2       4.2 
    Total Investment Securities   2.2    10.6    12.8 
    Loans and Leases         
    Commercial and industrial   (3.0)   4.1    1.1 
    Commercial real estate   4.7    12.2    16.9 
    Construction   (1.1)   2.6    1.5 
    Residential:         
    Residential mortgage   3.1    (1.3)   1.8 
    Home equity line   1.1    0.6    1.7 
    Consumer   (0.6)   0.9    0.3 
    Lease financing   0.3    0.4    0.7 
    Total Loans and Leases   4.5    19.5    24.0 
    Other Earning Assets      (0.2)   (0.2)
    Total Change in Interest Income   5.6    34.1    39.7 
              
    Change in Interest Expense:         
    Interest-Bearing Deposits         
    Savings      6.1    6.1 
    Money Market      4.3    4.3 
    Time   (0.2)   0.2    
    Total Interest-Bearing Deposits   (0.2)   10.6    10.4 
    Long-Term Borrowings   (0.7)   (0.7)   (1.4)
    Total Change in Interest Expense   (0.9)   9.9    9.0 
    Change in Net Interest Income $ 6.5  $ 24.2  $ 30.7 


              
    Analysis of Change in Net Interest Income        Table 8 
      Nine Months Ended September 30, 2022
      Compared to September 30, 2021
    (dollars in millions) Volume Rate Total
    Change in Interest Income:         
    Interest-Bearing Deposits in Other Banks $ (0.7) $ 6.5  $ 5.8 
    Available-for-Sale Investment Securities         
    Taxable   (13.4)   10.8    (2.6)
    Non-Taxable   (3.8)   1.3    (2.5)
    Held-to-Maturity Investment Securities         
    Taxable   29.7       29.7 
    Non-Taxable   8.3       8.3 
    Total Investment Securities   20.8    12.1    32.9 
    Loans Held for Sale   (0.1)      (0.1)
    Loans and Leases         
    Commercial and industrial   (18.8)   7.9    (10.9)
    Commercial real estate   9.5    13.7    23.2 
    Construction   (1.6)   3.1    1.5 
    Residential:         
    Residential mortgage   10.5    (5.8)   4.7 
    Home equity line   2.3    (0.5)   1.8 
    Consumer   (2.8)   (0.5)   (3.3)
    Lease financing   0.1    0.9    1.0 
    Total Loans and Leases   (0.8)   18.8    18.0 
    Other Earning Assets   0.1    (0.4)   (0.3)
    Total Change in Interest Income   19.3    37.0    56.3 
              
    Change in Interest Expense:         
    Interest-Bearing Deposits         
    Savings   0.1    7.1    7.2 
    Money Market   0.1    5.2    5.3 
    Time   (1.1)   (1.0)   (2.1)
    Total Interest-Bearing Deposits   (0.9)   11.3    10.4 
    Long-Term Borrowings   (2.1)   (2.1)   (4.2)
    Total Change in Interest Expense   (3.0)   9.2    6.2 
    Change in Net Interest Income $ 22.3  $ 27.8  $ 50.1 


                 
    Loans and Leases           Table 9
      September 30, June 30, December 31, September 30,
    (dollars in thousands) 2022 2022 2021 2021
    Commercial and industrial:            
    Commercial and industrial excluding Paycheck Protection Program loans $2,017,095 $1,898,899 $1,870,657 $1,692,315
    Paycheck Protection Program loans  26,712  43,233  216,442  503,069
    Total commercial and industrial  2,043,807  1,942,132  2,087,099  2,195,384
    Commercial real estate  4,103,310  3,956,828  3,639,623  3,569,768
    Construction  765,862  727,771  813,969  826,078
    Residential:            
    Residential mortgage  4,252,041  4,212,768  4,083,367  3,914,632
    Home equity line  1,010,631  971,569  876,608  852,074
    Total residential  5,262,672  5,184,337  4,959,975  4,766,706
    Consumer  1,218,885  1,207,051  1,229,939  1,238,714
    Lease financing  305,838  244,662  231,394  237,689
    Total loans and leases $13,700,374 $13,262,781 $12,961,999 $12,834,339


                 
    Deposits           Table 10
      September 30, June 30, December 31, September 30,
    (dollars in thousands) 2022 2022 2021 2021
    Demand $9,317,093 $9,610,883 $9,393,863 $8,873,424
    Savings  6,724,783  7,243,185  6,612,775  7,347,079
    Money Market  4,150,940  4,079,706  4,033,070  4,019,250
    Time  1,898,922  1,667,680  1,776,438  1,880,250
    Total Deposits $22,091,738 $22,601,454 $21,816,146 $22,120,003


                 
    Non-Performing Assets and Accruing Loans and Leases Past Due 90 Days or More           Table 11
      September 30, June 30, December 31, September 30,
    (dollars in thousands) 2022 2022 2021 2021
    Non-Performing Assets            
    Non-Accrual Loans and Leases            
    Commercial Loans:            
    Commercial and industrial $1,528 $682 $718 $746
    Commercial real estate  727  727  727  745
    Total Commercial Loans  2,255  1,409  1,445  1,491
    Residential Loans:            
    Residential mortgage  6,028  6,450  5,637  7,137
    Total Residential Loans  6,028  6,450  5,637  7,137
    Total Non-Accrual Loans and Leases  8,283  7,859  7,082  8,628
    Other Real Estate Owned  139    175  
    Total Non-Performing Assets $8,422 $7,859 $7,257 $8,628
                 
    Accruing Loans and Leases Past Due 90 Days or More            
    Commercial Loans:            
    Commercial and industrial $1,445 $2,230 $740 $439
    Commercial real estate    176    
    Construction  390  352    
    Total Commercial Loans  1,835  2,758  740  439
    Residential Loans:            
    Residential mortgage    750  987  100
    Home equity line  1,832  1,039  3,681  3,871
    Total Residential Loans  1,832  1,789  4,668  3,971
    Consumer  1,976  1,218  1,800  1,376
    Total Accruing Loans and Leases Past Due 90 Days or More $5,643 $5,765 $7,208 $5,786
                 
    Restructured Loans on Accrual Status and Not Past Due 90 Days or More $27,342 $29,440 $34,893 $36,234
    Total Loans and Leases $13,700,374 $13,262,781 $12,961,999 $12,834,339


                    
    Allowance for Credit Losses and Reserve for Unfunded Commitments
                  Table 12 
      For the Three Months Ended For the Nine Months Ended
      September 30, June 30, September 30, September 30, September 30,
    (dollars in thousands) 2022
     2022
     2021
     2022
     2021
    Balance at Beginning of Period $ 177,900  $179,238  $198,370   187,584   239,057 
    Loans and Leases Charged-Off               
    Commercial Loans:               
    Commercial and industrial   (328)  (243)  (224)  (1,277)  (1,517)
    Commercial real estate   (750)        (750)  (66)
    Total Commercial Loans   (1,078)  (243)  (224)  (2,027)  (1,583)
    Residential Loans:               
    Residential mortgage   (1)        (1)  (98)
    Home equity line     (1,120)  (235)  (1,163)  (235)
    Total Residential Loans   (1)  (1,120)  (235)  (1,164)  (333)
    Consumer   (3,986)  (3,659)  (2,926)  (11,754)  (13,384)
    Total Loans and Leases Charged-Off   (5,065)  (5,022)  (3,385)  (14,945)  (15,300)
    Recoveries on Loans and Leases Previously Charged-Off               
    Commercial Loans:               
    Commercial and industrial   240   301   121   594   623 
    Commercial real estate        15   14   30 
    Construction              166 
    Lease financing     60      60    
    Total Commercial Loans   240   361   136   668   819 
    Residential Loans:               
    Residential mortgage   37   192   215   245   246 
    Home equity line   356   191   27   575   89 
    Total Residential Loans   393   383   242   820   335 
    Consumer   1,653   1,940   2,405   5,741   7,857 
    Total Recoveries on Loans and Leases Previously Charged-Off   2,286   2,684   2,783   7,229   9,011 
    Net Loans and Leases Charged-Off   (2,779)  (2,338)  (602)  (7,716)  (6,289)
    Provision for Credit Losses   3,183   1,000   (4,000)  (1,564)  (39,000)
    Balance at End of Period $ 178,304  $177,900  $193,768  $178,304  $193,768 
    Components:               
    Allowance for Credit Losses $ 148,163  $148,942  $161,246  $148,163  $161,246 
    Reserve for Unfunded Commitments   30,141   28,958   32,522   30,141   32,522 
    Total Allowance for Credit Losses and Reserve for Unfunded Commitments $ 178,304  $177,900  $193,768  $178,304  $193,768 
    Average Loans and Leases Outstanding $ 13,491,428  $13,058,558  $12,881,885  $13,125,660  $13,108,427 
    Ratio of Net Loans and Leases Charged-Off to Average Loans and Leases Outstanding(1)   0.08%  0.07%  0.02%  0.08%  0.06%
    Ratio of Allowance for Credit Losses for Loans and Leases to Loans and Leases Outstanding   1.08%  1.12%  1.26%  1.08%  1.26%
    Ratio of Allowance for Credit Losses for Loans and Leases to Non-accrual Loans and Leases  17.89x  18.95x  18.69x  17.89x  18.69x

    (1)  Annualized for the three and nine months ended September 30, 2022 and 2021, and three months ended June 30, 2022.


                                
    Loans and Leases by Year of Origination and Credit Quality Indicator  Table 13
                           Revolving   
                           Loans   
                           Converted   
      Term Loans Revolving to Term   
      Amortized Cost Basis by Origination Year Loans Loans   
                        Amortized Amortized   
    (dollars in thousands) 2022 2021 2020 2019 2018 Prior Cost Basis Cost Basis Total
    Commercial Lending                           
    Commercial and Industrial                           
    Risk rating:                           
    Pass $ 310,400 $ 425,853 $ 55,272 $ 177,670 $ 55,923 $ 151,156 $ 709,823 $ 15,997 $ 1,902,094
    Special Mention   2,179   274   1,492   2,562   209   1,776   31,747   467   40,706
    Substandard   655   719   872   1,383   956   1,196   14,728   89   20,598
    Other (1)   12,817   8,707   10,095   4,664   2,355   1,358   40,413     80,409
    Total Commercial and Industrial   326,051   435,553   67,731   186,279   59,443   155,486   796,711   16,553   2,043,807
                                
    Commercial Real Estate                           
    Risk rating:                           
    Pass   700,785   696,763   355,992   548,364   449,754   1,242,315   66,075     4,060,048
    Special Mention   183     559   14,965   515   9,549   687     26,458
    Substandard       176     1,724   14,749   2     16,651
    Other (1)             153       153
    Total Commercial Real Estate   700,968   696,763   356,727   563,329   451,993   1,266,766   66,764     4,103,310
                                
    Construction                           
    Risk rating:                           
    Pass   83,233   225,116   84,312   92,856   116,344   86,722   13,443     702,026
    Special Mention         229           229
    Substandard           346   494       840
    Other (1)   22,424   25,610   4,258   2,247   3,908   3,367   953     62,767
    Total Construction   105,657   250,726   88,570   95,332   120,598   90,583   14,396     765,862
                                
    Lease Financing                           
    Risk rating:                           
    Pass   110,563   25,450   46,635   42,307   6,904   68,028       299,887
    Special Mention     434   2,591   1,342   9         4,376
    Substandard       196   14   13   1,352       1,575
    Total Lease Financing   110,563   25,884   49,422   43,663   6,926   69,380       305,838
                                
    Total Commercial Lending $ 1,243,239 $ 1,408,926 $ 562,450 $ 888,603 $ 638,960 $ 1,582,215 $ 877,871 $ 16,553 $ 7,218,817


                                
                           Revolving   
                           Loans   
                           Converted   
      Term Loans Revolving to Term   
      Amortized Cost Basis by Origination Year Loans Loans   
    (continued)                   Amortized Amortized   
    (dollars in thousands) 2022 2021 2020 2019 2018 Prior Cost
    Basis
     Cost
    Basis
     Total
    Residential Lending                           
    Residential Mortgage                           
    FICO:                           
    740 and greater $474,234 $1,056,814 $577,378 $244,169 $169,100 $941,705 $ $ $3,463,400
    680 - 739  54,037  122,420  77,660  44,519  21,581  137,573      457,790
    620 - 679  7,749  19,021  13,776  4,801  3,868  35,926      85,141
    550 - 619  168  1,930  292  225  2,060  7,225      11,900
    Less than 550  2,053  1,236  59    339  4,621      8,308
    No Score (3)  16,029  14,771  6,874  13,004  16,023  50,871      117,572
    Other (2)  19,155  18,827  15,436  9,398  9,229  29,468  5,861  556  107,930
    Total Residential Mortgage  573,425  1,235,019  691,475  316,116  222,200  1,207,389  5,861  556  4,252,041
                                
    Home Equity Line                           
    FICO:                           
    740 and greater              781,307  1,961  783,268
    680 - 739              164,166  2,650  166,816
    620 - 679              42,043  2,124  44,167
    550 - 619              8,719  1,375  10,094
    Less than 550              1,157  487  1,644
    No Score (3)              4,642    4,642
    Total Home Equity Line              1,002,034  8,597  1,010,631
    Total Residential Lending  573,425  1,235,019  691,475  316,116  222,200  1,207,389  1,007,895  9,153  5,262,672
                                
    Consumer Lending                        
    FICO:                           
    740 and greater  167,566  120,725  59,620  50,907  30,750  12,114  116,628  195  558,505
    680 - 739  80,920  72,861  41,177  36,236  19,242  10,311  68,968  569  330,284
    620 - 679  19,673  32,216  15,779  19,379  11,622  8,584  30,441  1,033  138,727
    550 - 619  2,159  5,975  5,859  9,266  6,476  5,188  9,803  983  45,709
    Less than 550  520  1,557  2,631  4,311  2,106  1,991  2,923  379  16,418
    No Score (3)  2,122  337  1  50  28  35  38,831  237  41,641
    Other (2)  1,645  4,197  358  1,393    2,153  77,855    87,601
    Total Consumer Lending  274,605  237,868  125,425  121,542  70,224  40,376  345,449  3,396  1,218,885
                                
    Total Loans and Leases $2,091,269 $2,881,813 $1,379,350 $1,326,261 $931,384 $2,829,980 $2,231,215 $29,102 $13,700,374

    (1)  Other credit quality indicators used for monitoring purposes are primarily FICO scores. The majority of the loans in this population were originated to borrowers with a prime FICO score.

    (2)  Other credit quality indicators used for monitoring purposes are primarily internal risk ratings. The majority of the loans in this population were graded with a “Pass” rating.

    (3)  No FICO scores are primarily related to loans and leases extended to non-residents. Loans and leases of this nature are primarily secured by collateral and/or are closely monitored for performance.


                     
    GAAP to Non-GAAP Reconciliation Table 14
     
      For the Three Months Ended For the Nine Months Ended 
      September 30, June 30, September 30, September 30, 
    (dollars in thousands, except per share amounts) 2022 2022 2021 2022 2021 
    Income Statement Data:                
    Net income $ 69,018 $59,360 $64,279 $ 186,097 $208,713 
                     
    Average total stockholders’ equity $ 2,267,152 $2,262,654 $2,738,540 $ 2,358,195 $2,719,442 
    Less: average goodwill   995,492  995,492  995,492   995,492  995,492 
    Average tangible stockholders’ equity $ 1,271,660 $1,267,162 $1,743,048 $ 1,362,703 $1,723,950 
                     
    Average total assets $ 24,957,042 $25,250,176 $25,058,085 $ 25,095,438 $24,013,691 
    Less: average goodwill   995,492  995,492  995,492   995,492  995,492 
    Average tangible assets $ 23,961,550 $24,254,684 $24,062,593 $ 24,099,946 $23,018,199 
                     
    Return on average total stockholders’ equity(1)   12.08% 10.52% 9.31%  10.55% 10.26%
    Return on average tangible stockholders’ equity (non-GAAP)(1)   21.53% 18.79% 14.63%  18.26% 16.19%
                     
    Return on average total assets(1)   1.10% 0.94% 1.02%  0.99% 1.16%
    Return on average tangible assets (non-GAAP)(1)   1.14% 0.98% 1.06%  1.03% 1.21%


               
      As of As of As of As of 
      September 30, June 30, December 31, September 30, 
    (dollars in thousands, except per share amounts) 2022 2022 2021 2021 
    Balance Sheet Data:             
    Total stockholders’ equity $ 2,200,651 $2,252,611 $2,656,912 $2,711,734 
    Less: goodwill   995,492  995,492  995,492  995,492 
    Tangible stockholders’ equity $ 1,205,159 $1,257,119 $1,661,420 $1,716,242 
                  
    Total assets $ 24,870,272 $25,377,533 $24,992,410 $25,548,322 
    Less: goodwill   995,492  995,492  995,492  995,492 
    Tangible assets $ 23,874,780 $24,382,041 $23,996,918 $24,552,830 
                  
    Shares outstanding   127,357,680  127,451,087  127,502,472  128,255,570 
                  
    Total stockholders’ equity to total assets   8.85% 8.88% 10.63% 10.61%
    Tangible stockholders’ equity to tangible assets (non-GAAP)   5.05% 5.16% 6.92% 6.99%
                  
    Book value per share $ 17.28 $17.67 $20.84 $21.14 
    Tangible book value per share (non-GAAP) $ 9.46 $9.86 $13.03 $13.38 

    (1)  Annualized for the three and nine months ended September 30, 2022 and 2021, and three months ended June 30, 2022.


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