WTFC - Wintrust Financial Corporation Reports First Quarter 2022 Net Income of $127.4 million

April, 19 2022 04:50 PM Wintrust Financial Corporation

ROSEMONT, Ill., April 19, 2022 (GLOBE NEWSWIRE) -- Wintrust Financial Corporation (“Wintrust”, “the Company”, “we” or “our”) (Nasdaq: WTFC) announced net income of $127.4 million or $2.07 per diluted common share for the first quarter of 2022, an increase in diluted earnings per common share of 31% compared to the fourth quarter of 2021.

Highlights of the First Quarter of 2022:
Comparative information to the fourth quarter of 2021

Total loans, excluding Paycheck Protection Program (“PPP”) loans, increased by $796 million, or 9% on an annualized basis.
- Core loans increased by $486 million and niche loans increased by $310 million.
- PPP loans declined by $304 million in the first quarter of 2022 primarily as a result of processing forgiveness payments.
Total assets increased by $109 million totaling $50.3 billion as of March 31, 2022.
Total deposits increased by $124 million.
Net interest income increased by $3.3 million as compared to the fourth quarter of 2021 as follows:
- Increased $16.7 million primarily due to earning asset growth and improvement in net interest margin.
- Decreased by approximately $6.7 million due to two fewer days in the first quarter of 2022.
- Decreased by $6.7 million due to less PPP interest income.
Net interest margin increased by six basis points primarily due to improved earning asset mix related to liquidity deployment and lower rates on interest bearing liabilities.
Recorded $2.5 million of net charge-offs or three basis points on an annualized basis in the first quarter of 2022 as compared to $6.2 million of net charge-offs or seven basis points on an annualized basis in the fourth quarter of 2021.
Recorded a provision for credit losses of $4.1 million in the first quarter of 2022 as compared to a provision for credit losses of $9.3 million in the fourth quarter of 2021.
The allowance for credit losses on our core loan portfolio is approximately 1.31% of the outstanding balance as of March 31, 2022, down from 1.33% as of December 31, 2021. See Table 11 for more information.
Non-performing loans decreased to 0.16% of total loans, as of March 31, 2022, down from 0.21% as of December 31, 2021.
Mortgage banking revenue increased to $77.2 million for the first quarter of 2022 as compared to $53.1 million in the fourth quarter of 2021.
- The Company recorded a $43.4 million increase in the value of mortgage servicing rights related to changes in fair value model assumptions as compared to a $6.7 million increase recognized in the fourth quarter of 2021.
Recorded net losses on investment securities of $2.8 million in the first quarter of 2022 related to fair value changes in equity securities as compared to net losses of $1.1 million in the fourth quarter of 2021.
Tangible book value per common share (non-GAAP) decreased slightly to $59.34 as of March 31, 2022 as compared to $59.64 as of December 31, 2021. The decline in tangible book value per common share was primarily driven by a decline in the market value of available-for-sale securities as of March 31, 2022, nearly offset by earnings in the quarter. See Table 17 for reconciliation of non-GAAP measures.

Edward J. Wehmer, Founder and Chief Executive Officer, commented, "Wintrust kicked off 2022 with an impressive first quarter reporting record quarterly pre-tax, pre-provision income highlighted by continued expansion of net interest income. Our diversified loan book exhibited strong growth while credit quality remains extraordinarily good. The Company’s future prospects remain bright as we believe our asset sensitive interest rate position will allow us to capitalize on potentially rising interest rates. Wintrust reported net income of $127.4 million for the first quarter of 2022, up from $98.8 million in the fourth quarter of 2021. Additionally, pre-tax, pre-provision income (non-GAAP) was a record level of $177.8 million in the first quarter of 2022 as compared to $146.3 million in the fourth quarter of 2021."

Mr. Wehmer continued, "The Company experienced robust loan growth as loans, excluding PPP loans, increased by $796 million or 9% on an annualized basis in the first quarter of 2022. We continue to pick up new market share and grow organically as all of our material loan portfolios exhibited strong growth in the first quarter of 2022. We are still experiencing low commercial line of credit utilization and feel confident that we can continue to grow loans given our robust loan pipelines and diversified loan portfolio. Our loans to deposits ratio ended the quarter at 83.6% and we believe that we have sufficient liquidity to meet customer loan demand."

Mr. Wehmer commented, "Net interest income increased by $3.3 million in the first quarter of 2022 primarily due to earning asset growth and improvement in net interest margin. The expansion in net interest income is particularly impressive when considering there were two fewer days in the first quarter of 2022 as compared to the fourth quarter of 2021. Additionally, the Company’s robust loan growth has continued to more than offset the declining contribution from PPP loans. During the quarter we also improved our net interest margin and increased our quarterly net interest income run rate by increasing our investment portfolio by $1.2 billion.”

Mr. Wehmer stated, “We have maintained our asset sensitive interest rate position which we expect to benefit us as short term interest rates rise. Based on modeled contractual cash flows, including prepayment assumptions, approximately 80% of our current loan balances are projected to reprice or mature in the next 12 months. Further, we project that, assuming an immediate and parallel 25 basis point rate hike, the cumulative increase to net interest income in the subsequent 12 months is approximately $40-$50 million. Such projections incorporate a number of assumptions and could differ materially depending on various factors including competition and the macroeconomic environment.”

Mr. Wehmer noted, “We recorded mortgage banking revenue of $77.2 million in the first quarter of 2022 as compared to $53.1 million in the fourth quarter of 2021. Loan volumes originated for sale in the first quarter of 2022 were $896 million, down from $1.3 billion in the fourth quarter of 2021. The Company recorded a $43.4 million increase in the value of mortgage servicing rights related to changes in fair value model assumptions as compared to a $6.7 million increase recognized in the fourth quarter of 2021. We are focused on expanding our market share of purchase originations and finding efficiencies in our delivery channels to reduce costs in light of the challenging interest rate environment. Based on current market conditions, we expect that mortgage originations in the second quarter of 2022 will remain relatively similar to the first quarter of 2022.”

Commenting on credit quality, Mr. Wehmer stated, "I am impressed that we have yet again, reset our record low level of non-performing loans at 0.16% of total loans, as of March 31, 2022. During the first quarter of 2022, we continued our practice of pursuing the resolution of non-performing credits and executed a loan sale that reduced non-performing loans by approximately $9 million with associated net charge-offs of $413,000. The first quarter of 2022 continued the trend of benign quarterly net charge-offs at $2.5 million and the Company recorded a provision for credit losses of $4.1 million. The allowance for credit losses on our core loan portfolio as of March 31, 2022 is approximately 1.31% of the outstanding balance. We believe that the Company’s reserves remain appropriate and we remain diligent in our review of credit."

Mr. Wehmer concluded, “Our first quarter of 2022 results continued to demonstrate the multi-faceted nature of our business model which we believe uniquely positions us to be successful. We expect to leverage our differentiated, diversified loan portfolio to outperform peers with respect to loan growth which should allow us to continue to expand net interest income. We are focused on taking advantage of market opportunities to prudently deploy excess liquidity into earning assets including core and niche loans and investment securities while maintaining an interest rate sensitive asset portfolio. We are opportunistically evaluating the acquisition market which has been active for both banks and business lines of various sizes. Of course, we remain diligent in our consideration of acquisition targets and intend to be prudent in our decision-making, always seeking to minimize dilution.”

The graphs below illustrate certain financial highlights of the first quarter of 2022 as well as historical financial performance. See “Supplemental Non-GAAP Financial Measures/Ratios” at Table 17 for additional information with respect to non-GAAP financial measures/ratios, including the reconciliations to the corresponding GAAP financial measures/ratios.

Graphs available at the following link: http://ml.globenewswire.com/Resource/Download/b3e2c31a-9c4d-41a0-a095-355ecf0d43d1

SUMMARY OF RESULTS:

BALANCE SHEET

Total loans, excluding PPP loans, increased by $796 million as core loans increased by $486 million and niche loans increased by $310 million. See Table 1 for more information. As of March 31, 2022, virtually all of the PPP loan balances originated in 2020 were forgiven with only $40 million remaining on balance sheet of which nearly all are in the forgiveness process. Whereas, as of March 31, 2022, approximately 84% of PPP loan balances originated in 2021 were forgiven, 8% are in the forgiveness review or submission process and 8% have yet to apply for forgiveness. Also, during the first quarter of 2022 a portion of excess liquidity was deployed, increasing investments by $1.2 billion.

Total liabilities increased $115 million in the first quarter of 2022 resulting primarily from a $124 million increase in total deposits. The increase in deposits was primarily due to a $555 million increase in interest-bearing deposits partially offset by a $431 million decrease in non-interest-bearing deposits. The Company's loans to deposits ratio ended the quarter at 83.6%. Management believes in substantially funding the Company's balance sheet with core deposits and utilizes brokered or wholesale funding sources on a limited basis to manage its liquidity position as well as for interest rate risk management purposes.

For more information regarding changes in the Company’s balance sheet, see Consolidated Statements of Condition and Tables 1 through 3 in this report.

NET INTEREST INCOME

For the first quarter of 2022, net interest income totaled $299.3 million, an increase of $3.3 million as compared to the fourth quarter of 2021. The $3.3 million increase in net interest income in the first quarter of 2022 compared to the fourth quarter of 2021 was primarily due to earning asset growth and improvement in net interest margin. Additionally, the net interest income growth occurred despite two fewer days in the first quarter of 2022 compared to the fourth quarter of 2021 and a decline of $6.7 million due to less PPP interest income. As of March 31, 2022, the Company had approximately $6.3 million of net PPP loan fees that have yet to be recognized in income.

Net interest margin was 2.60% (2.61% on a fully taxable-equivalent basis, non-GAAP) during the first quarter of 2022 compared to 2.54% (2.55% on a fully taxable-equivalent basis, non-GAAP) during the fourth quarter of 2021. The net interest margin increase as compared to the fourth quarter of 2021 was due to a three basis point increase in yield on earning assets and a three basis point decrease in the rate paid on interest-bearing liabilities. The decrease in the rate paid on interest-bearing liabilities in the first quarter of 2022 as compared to the fourth quarter of 2021 is primarily due to a two basis point decrease in the rate paid on interest-bearing deposits primarily due to lower repricing of time deposits. The three basis point increase in the yield on earning assets in the first quarter of 2022 as compared to the fourth quarter of 2021 was primarily due to a shift in earning asset mix through liquidity deployment with increasing investment securities and decreasing levels of lower yielding liquidity management assets.

For more information regarding net interest income, see Tables 4 through 7 in this report.

ASSET QUALITY

The allowance for credit losses totaled $301.3 million as of March 31, 2022, an increase of $1.6 million as compared to $299.7 million as of December 31, 2021. A provision for credit losses totaling $4.1 million was recorded for the first quarter of 2022 as compared to $9.3 million recorded in the fourth quarter of 2021. For more information regarding the provision for credit losses, see Table 10 in this report.

Management believes the allowance for credit losses is appropriate to account for expected credit losses. The Current Expected Credit Losses (“CECL”) accounting standard requires the Company to estimate expected credit losses over the life of the Company’s financial assets as of the reporting date. There can be no assurances, however, that future losses will not significantly exceed the amounts provided for, thereby affecting future results of operations. A summary of the allowance for credit losses calculated for the loan components in each portfolio as of March 31, 2022, December 31, 2021, and September 30, 2021 is shown on Table 11 of this report.

Net charge-offs totaled $2.5 million in the first quarter of 2022, as compared to $6.2 million of net charge-offs in the fourth quarter of 2021. Net charge-offs as a percentage of average total loans were reported as three basis points in the first quarter of 2022 on an annualized basis compared to seven basis points on an annualized basis in the fourth quarter of 2021. For more information regarding net charge-offs, see Table 9 in this report.

The Company’s delinquency rates remain low and manageable. For more information regarding past due loans, see Table 12 in this report.

The ratio of non-performing assets to total assets was 0.13% as of March 31, 2022, compared to 0.16% at December 31, 2021. Non-performing assets totaled $63.5 million at March 31, 2022, compared to $78.7 million at December 31, 2021. Non-performing loans totaled $57.3 million, or 0.16% of total loans, at March 31, 2022 compared to $74.4 million, or 0.21% of total loans, at December 31, 2021. Other real estate owned (“OREO”) totaled $6.2 million at March 31, 2022, an increase of $1.9 million compared to $4.3 million at December 31, 2021. Management is pursuing the resolution of all non-performing assets. At this time, management believes OREO is appropriately valued at the lower of carrying value or fair value less estimated costs to sell. For more information regarding non-performing assets, see Table 13 in this report.

NON-INTEREST INCOME

Wealth management revenue decreased by $1.1 million during the first quarter of 2022 as compared to the fourth quarter of 2021 primarily related to unfavorable equity market performance. Wealth management revenue is comprised of the trust and asset management revenue of The Chicago Trust Company and Great Lakes Advisors, the brokerage commissions, managed money fees and insurance product commissions at Wintrust Investments and fees from tax-deferred like-kind exchange services provided by the Chicago Deferred Exchange Company.

Mortgage banking revenue increased by $24.1 million in the first quarter of 2022 as compared to the fourth quarter of 2021, primarily due to a $43.4 million favorable mortgage servicing rights portfolio fair value adjustment as compared to a $6.7 million favorable adjustment recognized in the fourth quarter of 2021. This increase was partially offset by a $13.6 million decline in production revenue. Loans originated for sale were $896 million in the first quarter of 2022, a decrease of $403 million as compared to the fourth quarter of 2021. The percentage of origination volume from refinancing activities was 47% in the first quarter of 2022 as compared to 48% in the fourth quarter of 2021. Mortgage banking revenue includes revenue from activities related to originating, selling and servicing residential real estate loans for the secondary market.

During the first quarter of 2022, the fair value of the mortgage servicing rights portfolio increased primarily due to the fair value adjustment increase of $43.4 million and capitalization of $14.4 million. These increases were partially offset by a reduction in value of $6.0 million due to payoffs and paydowns of the existing portfolio.

The Company recorded $3.7 million of fees from covered call options in the first quarter of 2022 as compared to $1.1 million in the fourth quarter of 2021. The Company has typically written call options with terms of less than three months against certain U.S. Treasury and agency securities held in its portfolio for liquidity and other purposes. Management has entered into these transactions with the goal of economically hedging security positions and enhancing its overall return on its investment portfolio by using fees generated from these options to compensate for net interest margin compression. These option transactions are designed to mitigate overall interest rate risk and do not qualify as hedges pursuant to accounting guidance.

Trading gains totaled $3.9 million in the first quarter of 2022 as compared to a gain of $206,000 recognized in the fourth quarter of 2021. Trading gains in the first quarter of 2022 relate primarily to a favorable market value adjustment on an interest rate cap derivative held as an economic hedge for potentially rising interest rates.

The Company recognized net losses on investment securities of $2.8 million in the first quarter of 2022 as compared to net losses of $1.1 million recognized in the fourth quarter of 2021.

Net operating lease income totaled $15.5 million in the first quarter of 2022 as compared to $14.2 million in the fourth quarter of 2021. The $1.3 million increase in the first quarter of 2022 is primarily attributable to increased gains on sale of lease assets as compared to the fourth quarter of 2021.

For more information regarding non-interest income, see Tables 14 and 15 in this report.

NON-INTEREST EXPENSE

Salaries and employee benefits expense increased by $5.2 million in the first quarter of 2022 as compared to the fourth quarter of 2021. The $5.2 million increase is primarily related to increased salary and incentive compensation expense, partially offset by lower commissions expense due to declining mortgage production.

Software and equipment expense totaled $22.8 million in the first quarter of 2022, a decrease of $898,000 as compared to the fourth quarter of 2021. The decrease is primarily due to accelerated depreciation recognized in the fourth quarter of 2021 related to the reduction in the useful life of a software asset that is planned to be replaced as we continue to make upgrades to our digital customer experience.

Advertising and marketing expenses in the first quarter of 2022 decreased by $2.1 million as compared to the fourth quarter of 2021 primarily related to lower media advertising costs. Marketing costs are incurred to promote the Company's brand, commercial banking capabilities, the Company's various products, to attract loans and deposits and to announce new branch openings as well as the expansion of the Company's non-bank businesses. The level of marketing expenditures depends on the timing of sponsorship programs utilized which are determined based on the market area, targeted audience, competition and various other factors.

The Company recorded a net OREO gain of $1.0 million in the first quarter of 2022 as compared to a net gain of $641,000 in the fourth quarter of 2021. The net gains are primarily attributable to the sale of OREO properties during the fourth quarter of 2021 and first quarter of 2022.

Miscellaneous expense in the first quarter of 2022 decreased by $1.2 million as compared to the fourth quarter of 2021. Miscellaneous expense includes ATM expenses, correspondent bank charges, directors fees, telephone, travel and entertainment, corporate insurance, dues and subscriptions, problem loan expenses and lending origination costs that are not deferred.

For more information regarding non-interest expense, see Table 16 in this report.

INCOME TAXES

The Company recorded income tax expense of $46.3 million in the first quarter of 2022 compared to $38.3 million in the fourth quarter of 2021. The effective tax rates were 26.65% in the first quarter of 2022 compared to 27.94% in the fourth quarter of 2021. The effective tax rates were partially impacted by the tax effects related to share-based compensation which fluctuate based on the Company’s stock price and timing of employee stock option exercises and vesting of other share-based awards. The Company recorded excess tax benefits of $2.2 million in the first quarter of 2022, compared to excess tax benefits of $866,000 in the fourth quarter of 2021 related to share-based compensation.

BUSINESS UNIT SUMMARY

Community Banking

Through its community banking unit, the Company provides banking and financial services primarily to individuals, small to mid-sized businesses, local governmental units and institutional clients residing primarily in the local areas the Company services. In the first quarter of 2022, this unit expanded its loan portfolio. The segment’s net interest income increased in the first quarter of 2022 as compared to the fourth quarter of 2021 due to growth in earning assets and an increased net interest margin.

Mortgage banking revenue was $77.2 million for the first quarter of 2022, an increase of $24.1 million as compared to the fourth quarter of 2021. Service charges on deposit accounts totaled $15.3 million in the first quarter of 2022, an increase of $549,000 as compared to the fourth quarter of 2021 primarily due to higher fees associated with commercial account activity. The Company’s gross commercial and commercial real estate loan pipelines remained robust as of March 31, 2022 indicating momentum for continued loan growth in the second quarter of 2022.

Specialty Finance

Through its specialty finance unit, the Company offers financing of insurance premiums for businesses and individuals, equipment financing through structured loans and lease products to customers in a variety of industries, accounts receivable financing and value-added, out-sourced administrative services and other services. Originations within the insurance premium financing receivables portfolio were $3.4 billion during the first quarter of 2022 and average balances increased by $551.4 million as compared to the fourth quarter of 2021. The Company’s leasing portfolio balance was unchanged in the first quarter of 2022, with its portfolio of assets, including capital leases, loans and equipment on operating leases, totaling $2.4 billion as of March 31, 2022 and December 31, 2021. Revenues from the Company’s out-sourced administrative services business were $1.9 million in the first quarter of 2022, effectively unchanged from the fourth quarter of 2021.

Wealth Management

Through four separate subsidiaries within its wealth management unit, the Company offers a full range of wealth management services, including trust and investment services, tax-deferred like-kind exchange services, asset management, securities brokerage services and 401(k) and retirement plan services. Wealth management revenue totaled $31.4 million in the first quarter of 2022, a decrease of $1.1 million compared to the fourth quarter of 2021. Decreases in wealth management revenue were primarily due to unfavorable equity market performance during the first quarter of 2022. At March 31, 2022, the Company’s wealth management subsidiaries had approximately $35.8 billion of assets under administration, which included $6.7 billion of assets owned by the Company and its subsidiary banks, representing a $274 million increase from the $35.5 billion of assets under administration at December 31, 2021.

ITEMS IMPACTING COMPARATIVE FINANCIAL RESULTS

Insurance Agency Loan Portfolio

On November 15, 2021, the Company completed its acquisition of certain assets from The Allstate Corporation (“Allstate”). Through this business combination, the Company acquired approximately $581.6 million of loans, net of allowance for credit losses measured on the acquisition date. The loan portfolio was comprised of approximately 1,800 loans to Allstate agents nationally. In addition to acquiring the loans, the Company became the national preferred provider of loans to Allstate agents. In connection with the loan acquisition, a team of Allstate agency lending specialists joined the Company, to augment and expand Wintrust’s existing insurance agency finance business. As the transaction was determined to be a business combination, the Company recorded goodwill of approximately $9.3 million on the purchase.

WINTRUST FINANCIAL CORPORATION

Key Operating Measures

Wintrust’s key operating measures and growth rates for the first quarter of 2022, as compared to the fourth quarter of 2021 (sequential quarter) and first quarter of 2021 (linked quarter), are shown in the table below:








% or ⁽¹⁾ basis point (bp) change from 4th Quarter 2021

% or basis point (bp) change from 1st Quarter 2021


Three Months Ended

(Dollars in thousands, except per share data)

Mar 31, 2022

Dec 31, 2021

Mar 31, 2021

Net income

$
127,391


$
98,757


$
153,148

29

%

(17
)
%
Pre-tax income, excluding provision for credit losses (non-GAAP) ⁽²⁾


177,786



146,344



161,512

21



10


Net income per common share – diluted


2.07



1.58



2.54

31



(19
)

Cash dividends declared per common share


0.34



0.31



0.31

10



10


Net revenue ⁽³⁾


462,084



429,743



448,401

8



3


Net interest income


299,294



295,976



261,895

1



14


Net interest margin


2.60
%


2.54
%


2.53
%
6

bps

7

bps
Net interest margin – fully taxable-equivalent (non-GAAP) ⁽²⁾


2.61



2.55



2.54

6



7


Net overhead ratio ⁽⁴⁾


1.00



1.21



0.90

(21
)


10


Return on average assets


1.04



0.80



1.38

24



(34
)

Return on average common equity


11.94



9.05



15.80

289



(386
)

Return on average tangible common equity (non-GAAP) ⁽²⁾


14.48



11.04



19.49

344



(501
)

At end of period











Total assets

$
50,250,661


$
50,142,143


$
45,682,202

1

%

10

%
Total loans ⁽⁵⁾


35,280,547



34,789,104



33,171,233

6



6


Total deposits


42,219,322



42,095,585



37,872,652

1



11


Total shareholders’ equity


4,492,256



4,498,688



4,252,511

(1
)


6

(1) Period-end balance sheet percentage changes are annualized.
(2) See “Supplemental Non-GAAP Financial Measures/Ratios” at Table 17 for additional information on this performance measure/ratio.
(3) Net revenue is net interest income plus non-interest income.
(4) The net overhead ratio is calculated by netting total non-interest expense and total non-interest income, annualizing this amount, and dividing by that period’s average total assets. A lower ratio indicates a higher degree of efficiency.
(5) Excludes mortgage loans held-for-sale.

Certain returns, yields, performance ratios, or quarterly growth rates are “annualized” in this presentation to represent an annual time period. This is done for analytical purposes to better discern, for decision-making purposes, underlying performance trends when compared to full-year or year-over-year amounts. For example, a 5% growth rate for a quarter would represent an annualized 20% growth rate. Additional supplemental financial information showing quarterly trends can be found on the Company’s website at www.wintrust.com by choosing “Financial Reports” under the “Investor Relations” heading, and then choosing “Financial Highlights.”

WINTRUST FINANCIAL CORPORATION
Selected Financial Highlights



Three Months Ended
(Dollars in thousands, except per share data)

Mar 31, 2022

Dec 31, 2021

Sep 30, 2021

Jun 30, 2021

Mar 31, 2021
Selected Financial Condition Data (at end of period):
Total assets

$
50,250,661


$
50,142,143


$
47,832,271


$
46,738,450


$
45,682,202

Total loans ⁽¹⁾


35,280,547



34,789,104



33,264,043



32,911,187



33,171,233

Total deposits


42,219,322



42,095,585



39,952,558



38,804,616



37,872,652

Total shareholders’ equity


4,492,256



4,498,688



4,410,317



4,339,011



4,252,511

Selected Statements of Income Data:
Net interest income

$
299,294


$
295,976


$
287,496


$
279,590


$
261,895

Net revenue ⁽²⁾


462,084



429,743



423,970



408,963



448,401

Net income


127,391



98,757



109,137



105,109



153,148

Pre-tax income, excluding provision for credit losses (non-GAAP) ⁽³⁾


177,786



146,344



141,826



128,851



161,512

Net income per common share – Basic


2.11



1.61



1.79



1.72



2.57

Net income per common share – Diluted


2.07



1.58



1.77



1.70



2.54

Cash dividends declared per common share


0.34



0.31



0.31



0.31



0.31

Selected Financial Ratios and Other Data:
Performance Ratios:
Net interest margin


2.60
%


2.54
%


2.58
%


2.62
%


2.53
%
Net interest margin – fully taxable-equivalent (non-GAAP) ⁽³⁾


2.61



2.55



2.59



2.63



2.54

Non-interest income to average assets


1.33



1.08



1.15



1.13



1.68

Non-interest expense to average assets


2.33



2.29



2.37



2.45



2.59

Net overhead ratio ⁽⁴⁾


1.00



1.21



1.22



1.32



0.90

Return on average assets


1.04



0.80



0.92



0.92



1.38

Return on average common equity


11.94



9.05



10.31



10.24



15.80

Return on average tangible common equity (non-GAAP) ⁽³⁾


14.48



11.04



12.62



12.62



19.49

Average total assets

$
49,501,844


$
49,118,777


$
47,192,510


$
45,946,751


$
44,988,733

Average total shareholders’ equity


4,500,460



4,433,953



4,343,915



4,256,778



4,164,890

Average loans to average deposits ratio


83.8
%


81.7
%


83.8
%


86.7
%


87.1
%
Period-end loans to deposits ratio


83.6



82.6



83.3



84.8



87.6

Common Share Data at end of period:
Market price per common share

$
92.93


$
90.82


$
80.37


$
75.63


$
75.80

Book value per common share


71.26



71.62



70.19



68.81



67.34

Tangible book value per common share (non-GAAP) ⁽³⁾


59.34



59.64



58.32



56.92



55.42

Common shares outstanding


57,253,214



57,054,091



56,956,026



57,066,677



57,023,273

Other Data at end of period:
Tier 1 leverage ratio ⁽⁵⁾


8.1
%


8.0
%


8.1
%


8.2
%


8.2
%
Risk-based capital ratios:










Tier 1 capital ratio ⁽⁵⁾


9.5



9.6



9.9



10.1



10.2

Common equity tier 1 capital ratio ⁽⁵⁾


8.6



8.6



8.9



9.0



9.0

Total capital ratio ⁽⁵⁾


11.6



11.6



12.1



12.4



12.6

Allowance for credit losses ⁽⁶⁾

$
301,327


$
299,731


$
296,138


$
304,121


$
321,308

Allowance for loan and unfunded lending-related commitment losses to total loans


0.85
%


0.86
%


0.89
%


0.92
%


0.97
%
Number of:










Bank subsidiaries


15



15



15



15



15

Banking offices


174



173



172



172



182

(1) Excludes mortgage loans held-for-sale.
(2) Net revenue is net interest income and non-interest income.
(3) See “Supplemental Non-GAAP Financial Measures/Ratios” at Table 17 for additional information on this performance measure/ratio.
(4) The net overhead ratio is calculated by netting total non-interest expense and total non-interest income, annualizing this amount, and dividing by that period’s average total assets. A lower ratio indicates a higher degree of efficiency.
(5) Capital ratios for current quarter-end are estimated.
(6) The allowance for credit losses includes the allowance for loan losses, the allowance for unfunded lending-related commitments and the allowance for held-to-maturity securities losses.

WINTRUST FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CONDITION



(Unaudited)



(Unaudited)

(Unaudited)

(Unaudited)


Mar 31,

Dec 31,

Sep 30,

Jun 30,

Mar 31,
(In thousands)


2022



2021



2021



2021



2021

Assets










Cash and due from banks

$
462,516


$
411,150


$
462,244


$
434,957


$
426,325

Federal funds sold and securities purchased under resale agreements


700,056



700,055



55



52



52

Interest-bearing deposits with banks


4,013,597



5,372,603



5,232,315



4,707,415



3,348,794

Available-for-sale securities, at fair value


2,998,898



2,327,793



2,373,478



2,188,608



2,430,749

Held-to-maturity securities, at amortized cost


3,435,729



2,942,285



2,736,722



2,498,232



2,166,419

Trading account securities


852



1,061



1,103



2,667



951

Equity securities with readily determinable fair value


92,689



90,511



88,193



86,316



90,338

Federal Home Loan Bank and Federal Reserve Bank stock


136,163



135,378



135,408



136,625



135,881

Brokerage customer receivables


22,888



26,068



26,378



23,093



19,056

Mortgage loans held-for-sale


606,545



817,912



925,312



984,994



1,260,193

Loans, net of unearned income


35,280,547



34,789,104



33,264,043



32,911,187



33,171,233

Allowance for loan losses


(250,539
)


(247,835
)


(248,612
)


(261,089
)


(277,709
)
Net loans


35,030,008



34,541,269



33,015,431



32,650,098



32,893,524

Premises, software and equipment, net


761,213



766,405



748,872



752,375



760,522

Lease investments, net


240,656



242,082



243,933



219,023



238,984

Accrued interest receivable and other assets


1,066,750



1,084,115



1,166,917



1,185,811



1,230,362

Trade date securities receivable


—



—



—



189,851



—

Goodwill


655,402



655,149



645,792



646,336



646,017

Other acquisition-related intangible assets


26,699



28,307



30,118



31,997



34,035

Total assets

$
50,250,661


$
50,142,143


$
47,832,271


$
46,738,450


$
45,682,202

Liabilities and Shareholders’ Equity










Deposits:










Non-interest-bearing

$
13,748,918


$
14,179,980


$
13,255,417


$
12,796,110


$
12,297,337

Interest-bearing


28,470,404



27,915,605



26,697,141



26,008,506



25,575,315

Total deposits


42,219,322



42,095,585



39,952,558



38,804,616



37,872,652

Federal Home Loan Bank advances


1,241,071



1,241,071



1,241,071



1,241,071



1,228,436

Other borrowings


482,516



494,136



504,527



518,493



516,877

Subordinated notes


437,033



436,938



436,811



436,719



436,595

Junior subordinated debentures


253,566



253,566



253,566



253,566



253,566

Trade date securities payable


437



—



1,348



—



995

Accrued interest payable and other liabilities


1,124,460



1,122,159



1,032,073



1,144,974



1,120,570

Total liabilities


45,758,405



45,643,455



43,421,954



42,399,439



41,429,691

Shareholders’ Equity:










Preferred stock


412,500



412,500



412,500



412,500



412,500

Common stock


59,091



58,892



58,794



58,770



58,727

Surplus


1,698,093



1,685,572



1,674,062



1,669,002



1,663,008

Treasury stock


(109,903
)


(109,903
)


(109,903
)


(100,363
)


(100,363
)
Retained earnings


2,548,474



2,447,535



2,373,447



2,288,969



2,208,535

Accumulated other comprehensive (loss) income


(115,999
)


4,092



1,417



10,133



10,104

Total shareholders’ equity


4,492,256



4,498,688



4,410,317



4,339,011



4,252,511

Total liabilities and shareholders’ equity

$
50,250,661


$
50,142,143


$
47,832,271


$
46,738,450


$
45,682,202

WINTRUST FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)


Three Months Ended
(In thousands, except per share data)
Mar 31, 2022

Dec 31, 2021

Sep 30, 2021

Jun 30, 2021

Mar 31, 2021
Interest income









Interest and fees on loans
$
285,698


$
289,140


$
285,587


$
284,701


$
274,100

Mortgage loans held-for-sale

6,087



7,234



7,716



8,183



9,036

Interest-bearing deposits with banks

1,687



2,254



2,000



1,153



1,199

Federal funds sold and securities purchased under resale agreements

431



173



—



—



—

Investment securities

32,398



27,210



25,189



23,623



19,264

Trading account securities

5



4



3



1



2

Federal Home Loan Bank and Federal Reserve Bank stock

1,772



1,776



1,777



1,769



1,745

Brokerage customer receivables

174



188



185



149



123

Total interest income

328,252



327,979



322,457



319,579



305,469

Interest expense









Interest on deposits

14,854



16,572



19,305



24,298



27,944

Interest on Federal Home Loan Bank advances

4,816



4,923



4,931



4,887



4,840

Interest on other borrowings

2,239



2,250



2,501



2,568



2,609

Interest on subordinated notes

5,482



5,514



5,480



5,512



5,477

Interest on junior subordinated debentures

1,567



2,744



2,744



2,724



2,704

Total interest expense

28,958



32,003



34,961



39,989



43,574

Net interest income

299,294



295,976



287,496



279,590



261,895

Provision for credit losses

4,106



9,299



(7,916
)


(15,299
)


(45,347
)
Net interest income after provision for credit losses

295,188



286,677



295,412



294,889



307,242

Non-interest income









Wealth management

31,394



32,489



31,531



30,690



29,309

Mortgage banking

77,231



53,138



55,794



50,584



113,494

Service charges on deposit accounts

15,283



14,734



14,149



13,249



12,036

(Losses) gains on investment securities, net

(2,782
)


(1,067
)


(2,431
)


1,285



1,154

Fees from covered call options

3,742



1,128



1,157



1,388



—

Trading gains (losses), net

3,889



206



58



(438
)


419

Operating lease income, net

15,475



14,204



12,807



12,240



14,440

Other

18,558



18,935



23,409



20,375



15,654

Total non-interest income

162,790



133,767



136,474



129,373



186,506

Non-interest expense









Salaries and employee benefits

172,355



167,131



170,912



172,817



180,809

Software and equipment

22,810



23,708



22,029



20,866



20,912

Operating lease equipment depreciation

9,708



10,147



10,013



9,949



10,771

Occupancy, net

17,824



18,343



18,158



17,687



19,996

Data processing

7,505



7,207



7,104



6,920



6,048

Advertising and marketing

11,924



13,981



13,443



11,305



8,546

Professional fees

8,401



7,551



7,052



7,304



7,587

Amortization of other acquisition-related intangible assets

1,609



1,811



1,877



2,039



2,007

FDIC insurance

7,729



7,317



6,750



6,405



6,558

OREO expense, net

(1,032
)


(641
)


(1,531
)


769



(251
)
Other

25,465



26,844



26,337



24,051



23,906

Total non-interest expense

284,298



283,399



282,144



280,112



286,889

Income before taxes

173,680



137,045



149,742



144,150



206,859

Income tax expense

46,289



38,288



40,605



39,041



53,711

Net income
$
127,391


$
98,757


$
109,137


$
105,109


$
153,148

Preferred stock dividends

6,991



6,991



6,991



6,991



6,991

Net income applicable to common shares
$
120,400


$
91,766


$
102,146


$
98,118


$
146,157

Net income per common share - Basic
$
2.11


$
1.61


$
1.79


$
1.72


$
2.57

Net income per common share - Diluted
$
2.07


$
1.58


$
1.77


$
1.70


$
2.54

Cash dividends declared per common share
$
0.34


$
0.31


$
0.31


$
0.31


$
0.31

Weighted average common shares outstanding

57,196



57,022



57,000



57,049



56,904

Dilutive potential common shares

862



976



753



726



681

Average common shares and dilutive common shares

58,058



57,998



57,753



57,775



57,585

TABLE 1: LOAN PORTFOLIO MIX AND GROWTH RATES











% Growth From ⁽²⁾
(Dollars in thousands)
Mar 31, 2022

Dec 31, 2021

Sep 30, 2021

Jun 30, 2021

Mar 31, 2021
Dec 31, 2021 ⁽¹⁾

Mar 31, 2021
Balance:












Mortgage loans held-for-sale, excluding early buy-out exercised loans guaranteed by U.S. Government Agencies
$
296,548

$
473,102

$
570,663

$
633,006

$
890,749
NM


(67
)%
Mortgage loans held-for-sale, early buy-out exercised loans guaranteed by U.S. Government Agencies

309,997


344,810


354,649


351,988


369,444
(41
)

(16
)
Total mortgage loans held-for-sale
$
606,545

$
817,912

$
925,312

$
984,994

$
1,260,193
NM


(52
)%













Core loans:












Commercial












Commercial and industrial
$
5,348,266

$
5,346,084

$
4,953,769

$
4,650,607

$
4,630,795
0
%

15
%
Asset-based lending

1,365,297


1,299,869


1,066,376


892,109


720,772
20


89

Municipal

533,357


536,498


524,192


511,094


493,417
(2
)

8

Leases

1,481,368


1,454,099


1,365,281


1,357,036


1,290,778
8


15

Commercial real estate












Residential construction

57,037


51,464


49,754


55,735


72,058
44


(21
)
Commercial construction

1,055,972


1,034,988


1,038,034


1,090,447


1,040,631
8


1

Land

283,397


269,752


255,927


239,067


240,635
21


18

Office ⁽³⁾

1,273,705


1,285,686


1,269,746


1,220,658


1,131,472
(4
)

13

Industrial ⁽³⁾

1,668,516


1,585,808


1,490,358


1,434,377


1,152,522
21


45

Retail ⁽³⁾

1,395,021


1,429,567


1,462,101


1,455,638


1,198,025
(10
)

16

Multi-family ⁽³⁾

2,175,875


2,043,754


2,038,526


1,984,582


1,739,521
26


25

Mixed use and other ⁽³⁾

1,325,551


1,289,267


1,281,268


1,197,865


1,969,915
11


(33
)
Home equity

321,435


335,155


347,662


369,806


390,253
(17
)

(18
)
Residential real estate












Residential real estate loans for investment

1,749,889


1,606,271


1,520,750


1,479,507


1,370,132
36


28

Residential mortgage loans, early buy-out eligible loans guaranteed by U.S. Government Agencies

13,520


22,707


18,847


44,333


45,508
NM


(70
)
Residential mortgage loans, early buy-out exercised loans guaranteed by U.S. Government Agencies

36,576


8,121


8,139


6,445


6,333
NM


NM

Total core loans
$
20,084,782

$
19,599,090

$
18,690,730

$
17,989,306

$
17,492,767
10
%

15
%













Niche loans:












Commercial












Franchise
$
1,181,761

$
1,227,234

$
1,176,569

$
1,060,468

$
1,128,493
(15
)%

5
%
Mortgage warehouse lines of credit

261,847


359,818


468,162


529,867


587,868
NM


(55
)
Community Advantage - homeowners association

324,383


308,286


291,153


287,689


272,222
21


19

Insurance agency lending

833,720


813,897


260,482


273,999


290,880
10


NM

Premium Finance receivables












U.S. property & casualty insurance

4,271,828


4,178,474


3,921,289


3,805,504


3,342,730
9


28

Canada property & casualty insurance

665,580


677,013


695,688


716,367


615,813
(7
)

8

Life insurance

7,354,163


7,042,810


6,655,453


6,359,556


6,111,495
18


20

Consumer and other

48,519


24,199


22,529


9,024


35,983
NM


35

Total niche loans
$
14,941,801

$
14,631,731

$
13,491,325

$
13,042,474

$
12,385,484
9
%

21
%













Commercial PPP loans:












Originated in 2020
$
40,016

$
74,412

$
172,849

$
656,502

$
2,049,342
NM


(98
)%
Originated in 2021

213,948


483,871


909,139


1,222,905


1,243,640
NM


(83
)
Total commercial PPP loans
$
253,964

$
558,283

$
1,081,988

$
1,879,407

$
3,292,982
NM


(92
)%













Total loans, net of unearned income
$
35,280,547

$
34,789,104

$
33,264,043

$
32,911,187

$
33,171,233
6
%

6
%

(1) Annualized.
(2) NM - Not meaningful.
(3) As a result of a review of the composition of borrowers within the mixed use and other loan portfolio, the Company identified certain loans that would be more precisely classified within a separate class of non-construction commercial real estate. This change in classification was based on related collateral and source of repayment of the underlying loan. Balances within such categories were also updated as of September 30, 2021 and June 30, 2021 in the table above for comparison purposes.

TABLE 2: DEPOSIT PORTFOLIO MIX AND GROWTH RATES











% Growth From
(Dollars in thousands)
Mar 31, 2022

Dec 31, 2021

Sep 30, 2021

Jun 30, 2021

Mar 31, 2021
Dec 31, 2021 ⁽¹⁾

Mar 31, 2021
Balance:












Non-interest-bearing
$
13,748,918


$
14,179,980


$
13,255,417


$
12,796,110


$
12,297,337

(12
)%

12
%
NOW and interest-bearing demand deposits

4,571,484



4,158,871



3,769,825



3,625,538



3,562,312

40


28

Wealth management deposits ⁽²⁾

5,402,271



4,491,795



4,177,820



4,399,303



4,274,527

82


26

Money market

10,671,424



11,449,469



10,757,654



9,843,390



9,236,434

(28
)

16

Savings

4,089,230



3,846,681



3,861,296



3,776,400



3,690,892

26


11

Time certificates of deposit

3,735,995



3,968,789



4,130,546



4,363,875



4,811,150

(24
)

(22
)
Total deposits
$
42,219,322


$
42,095,585


$
39,952,558


$
38,804,616


$
37,872,652

1
%

11
%
Mix:












Non-interest-bearing

32
%


34
%


33
%


33
%


32
%



NOW and interest-bearing demand deposits

11



10



9



9



9




Wealth management deposits ⁽²⁾

13



11



11



11



11




Money market

25



27



27



25



25




Savings

10



9



10



10



10




Time certificates of deposit

9



9



10



12



13




Total deposits

100
%


100
%


100
%


100
%


100
%

(1) Annualized.
(2) Represents deposit balances of the Company’s subsidiary banks from brokerage customers of Wintrust Investments, Chicago Deferred Exchange Company, LLC (“CDEC”), trust and asset management customers of the Company and brokerage customers from unaffiliated companies which have been placed into deposit accounts.

TABLE 3: TIME CERTIFICATES OF DEPOSIT MATURITY/RE-PRICING ANALYSIS
As of March 31, 2022

(Dollars in thousands)

Total Time
Certificates of
Deposit

Weighted-Average
Rate of Maturing
Time Certificates
of Deposit ⁽¹⁾

1-3 months

777,783

0.35

4-6 months

730,262

0.38

7-9 months

686,898

0.39

10-12 months

564,328

0.40

13-18 months

521,500

0.38

19-24 months

297,563

0.48

24+ months

157,661

0.53

Total

3,735,995

0.39

(1) Weighted-average rate excludes the impact of purchase accounting fair value adjustments.

TABLE 4: QUARTERLY AVERAGE BALANCES



Average Balance for three months ended,


Mar 31,

Dec 31,

Sep 30,

Jun 30,

Mar 31,
(In thousands)

2022

2021

2021

2021

2021
Interest-bearing deposits with banks, securities purchased under resale agreements and cash equivalents ⁽¹⁾

$
4,563,726


$
6,148,165


$
5,112,720


$
3,844,355


$
4,230,886

Investment securities ⁽²⁾


6,378,022



5,317,351



5,065,593



4,771,403



3,944,676

FHLB and FRB stock


135,912



135,414



136,001



136,324



135,758

Liquidity management assets ⁽³⁾


11,077,660



11,600,930



10,314,314



8,752,082



8,311,320

Other earning assets ⁽³⁾⁽⁴⁾


25,192



28,298



28,238



23,354



20,370

Mortgage loans held-for-sale


664,019



827,672



871,824



991,011



1,151,848

Loans, net of unearned income ⁽³⁾⁽⁵⁾


34,830,520



33,677,777



32,985,445



33,085,174



32,442,927

Total earning assets ⁽³⁾


46,597,391



46,134,677



44,199,821



42,851,621



41,926,465

Allowance for loan and investment security losses


(253,080
)


(254,874
)


(269,963
)


(285,686
)


(327,080
)
Cash and due from banks


481,634



468,331



425,000



470,566



366,413

Other assets


2,675,899



2,770,643



2,837,652



2,910,250



3,022,935

Total assets

$
49,501,844


$
49,118,777


$
47,192,510


$
45,946,751


$
44,988,733












NOW and interest-bearing demand deposits

$
4,287,228


$
3,962,739


$
3,757,677


$
3,626,424


$
3,493,451

Wealth management deposits


4,427,301



4,514,319



4,672,402



4,369,998



4,156,398

Money market accounts


11,353,348



11,274,230



10,027,424



9,547,167



9,335,920

Savings accounts


3,904,299



3,766,037



3,851,523



3,728,271



3,587,566

Time deposits


3,861,371



4,058,282



4,236,317



4,632,796



4,875,392

Interest-bearing deposits


27,833,547



27,575,607



26,545,343



25,904,656



25,448,727

Federal Home Loan Bank advances


1,241,071



1,241,073



1,241,073



1,235,142



1,228,433

Other borrowings


494,267



501,933



512,785



525,924



518,188

Subordinated notes


436,966



436,861



436,746



436,644



436,532

Junior subordinated debentures


253,566



253,566



253,566



253,566



253,566

Total interest-bearing liabilities


30,259,417



30,009,040



28,989,513



28,355,932



27,885,446

Non-interest-bearing deposits


13,734,064



13,640,270



12,834,084



12,246,274



11,811,194

Other liabilities


1,007,903



1,035,514



1,024,998



1,087,767



1,127,203

Equity


4,500,460



4,433,953



4,343,915



4,256,778



4,164,890

Total liabilities and shareholders’ equity

$
49,501,844


$
49,118,777


$
47,192,510


$
45,946,751


$
44,988,733












Net free funds/contribution ⁽⁶⁾

$
16,337,974


$
16,125,637


$
15,210,308


$
14,495,689


$
14,041,019

(1) Includes interest-bearing deposits from banks and securities purchased under resale agreements with original maturities of greater than three months. Cash equivalents include federal funds sold and securities purchased under resale agreements with original maturities of three months or less.
(2) Investment securities includes investment securities classified as available-for-sale and held-to-maturity, and equity securities with readily determinable fair values. Equity securities without readily determinable fair values are included within other assets.
(3) See “Supplemental Non-GAAP Financial Measures/Ratios” at Table 17 for additional information on this performance measure/ratio.
(4) Other earning assets include brokerage customer receivables and trading account securities.
(5) Loans, net of unearned income, include non-accrual loans.
(6) Net free funds are the difference between total average earning assets and total average interest-bearing liabilities. The estimated contribution to net interest margin from net free funds is calculated using the rate paid for total interest-bearing liabilities.

TABLE 5: QUARTERLY NET INTEREST INCOME



Net Interest Income for three months ended,


Mar 31,

Dec 31,

Sep 30,

Jun 30,

Mar 31,
(In thousands)

2022

2021

2021

2021

2021
Interest income:










Interest-bearing deposits with banks, securities purchased under resale agreements and cash equivalents

$
2,118


$
2,427


$
2,000


$
1,153


$
1,199

Investment securities


32,863



27,696



25,681



24,117



19,764

FHLB and FRB stock


1,772



1,776



1,777



1,769



1,745

Liquidity management assets ⁽¹⁾


36,753



31,899



29,458



27,039



22,708

Other earning assets ⁽¹⁾


181



194



188



150



125

Mortgage loans held-for-sale


6,087



7,234



7,716



8,183



9,036

Loans, net of unearned income ⁽¹⁾


286,125



289,557



285,998



285,116



274,484

Total interest income

$
329,146


$
328,884


$
323,360


$
320,488


$
306,353












Interest expense:










NOW and interest-bearing demand deposits

$
849


$
774


$
767


$
736


$
901

Wealth management deposits


7,098



7,595



7,888



7,686



7,351

Money market accounts


2,609



2,604



2,342



2,795



2,865

Savings accounts


336



345



406



402



430

Time deposits


3,962



5,254



7,902



12,679



16,397

Interest-bearing deposits


14,854



16,572



19,305



24,298



27,944

Federal Home Loan Bank advances


4,816



4,923



4,931



4,887



4,840

Other borrowings


2,239



2,250



2,501



2,568



2,609

Subordinated notes


5,482



5,514



5,480



5,512



5,477

Junior subordinated debentures


1,567



2,744



2,744



2,724



2,704

Total interest expense

$
28,958


$
32,003


$
34,961


$
39,989


$
43,574












Less: Fully taxable-equivalent adjustment


(894
)


(905
)


(903
)


(909
)


(884
)
Net interest income (GAAP) ⁽²⁾


299,294



295,976



287,496



279,590



261,895

Fully taxable-equivalent adjustment


894



905



903



909



884

Net interest income, fully taxable-equivalent (non-GAAP) ⁽²⁾

$
300,188


$
296,881


$
288,399


$
280,499


$
262,779

(1) Interest income on tax-advantaged loans, trading securities and investment securities reflects a taxable-equivalent adjustment based on the marginal federal corporate tax rate in effect as of the applicable period.
(2) See “Supplemental Non-GAAP Financial Measures/Ratios” at Table 17 for additional information on this performance measure/ratio.

TABLE 6: QUARTERLY NET INTEREST MARGIN



Net Interest Margin for three months ended,


Mar 31, 2022

Dec 31, 2021

Sep 30, 2021

Jun 30, 2021

Mar 31, 2021
Yield earned on:










Interest-bearing deposits with banks, securities purchased under resale agreements and cash equivalents

0.19
%

0.16
%

0.16
%

0.12
%

0.11
%
Investment securities

2.09


2.07


2.01


2.03


2.03

FHLB and FRB stock

5.29


5.20


5.18


5.20


5.21

Liquidity management assets

1.35


1.09


1.13


1.24


1.11

Other earning assets

2.91


2.71


2.64


2.59


2.50

Mortgage loans held-for-sale

3.72


3.47


3.51


3.31


3.18

Loans, net of unearned income

3.33


3.41


3.44


3.46


3.43

Total earning assets

2.86
%

2.83
%

2.90
%

3.00
%

2.96
%











Rate paid on:










NOW and interest-bearing demand deposits

0.08
%

0.08
%

0.08
%

0.08
%

0.10
%
Wealth management deposits

0.65


0.67


0.67


0.71


0.72

Money market accounts

0.09


0.09


0.09


0.12


0.12

Savings accounts

0.03


0.04


0.04


0.04


0.05

Time deposits

0.42


0.51


0.74


1.10


1.36

Interest-bearing deposits

0.22


0.24


0.29


0.38


0.45

Federal Home Loan Bank advances

1.57


1.57


1.58


1.59


1.60

Other borrowings

1.84


1.78


1.94


1.96


2.04

Subordinated notes

5.02


5.05


5.02


5.05


5.02

Junior subordinated debentures

2.47


4.23


4.23


4.25


4.27

Total interest-bearing liabilities

0.39
%

0.42
%

0.48
%

0.56
%

0.63
%











Interest rate spread ⁽¹⁾⁽²⁾

2.47
%

2.41
%

2.42
%

2.44
%

2.33
%
Less: Fully taxable-equivalent adjustment

(0.01
)

(0.01
)

(0.01
)

(0.01
)

(0.01
)
Net free funds/contribution ⁽³⁾

0.14


0.14


0.17


0.19


0.21

Net interest margin (GAAP) ⁽²⁾

2.60
%

2.54
%

2.58
%

2.62
%

2.53
%
Fully taxable-equivalent adjustment

0.01


0.01


0.01


0.01


0.01

Net interest margin, fully taxable-equivalent (non-GAAP) ⁽²⁾

2.61
%

2.55
%

2.59
%

2.63
%

2.54
%

(1) Interest rate spread is the difference between the yield earned on earning assets and the rate paid on interest-bearing liabilities.
(2) See “Supplemental Non-GAAP Financial Measures/Ratios” at Table 17 for additional information on this performance measure/ratio.
(3) Net free funds are the difference between total average earning assets and total average interest-bearing liabilities. The estimated contribution to net interest margin from net free funds is calculated using the rate paid for total interest-bearing liabilities.

TABLE 7: INTEREST RATE SENSITIVITY

As an ongoing part of its financial strategy, the Company attempts to manage the impact of fluctuations in market interest rates on net interest income. Management measures its exposure to changes in interest rates by modeling many different interest rate scenarios.

The following interest rate scenarios display the percentage change in net interest income over a one-year time horizon assuming increases of 100 and 200 basis points and a decrease of 100 basis points. The Static Shock Scenario results incorporate actual cash flows and repricing characteristics for balance sheet instruments following an instantaneous, parallel change in market rates based upon a static (i.e. no growth or constant) balance sheet. Conversely, the Ramp Scenario results incorporate management’s projections of future volume and pricing of each of the product lines following a gradual, parallel change in market rates over twelve months. Actual results may differ from these simulated results due to timing, magnitude, and frequency of interest rate changes as well as changes in market conditions and management strategies. The interest rate sensitivity for both the Static Shock and Ramp Scenario is as follows:

Static Shock Scenario

+200 Basis Points

+100 Basis Points

-100 Basis Points
Mar 31, 2022

21.4
%

11.0
%

(11.3
) %
Dec 31, 2021

25.3


12.4


(8.5
)
Sep 30, 2021

24.3


11.5


(7.8
)
Jun 30, 2021

24.6


11.7


(6.9
)
Mar 31, 2021

22.0


10.2


(7.2
)

Ramp Scenario
+200 Basis Points

+100 Basis Points

-100 Basis Points
Mar 31, 2022
11.2
%

5.8
%

(7.1
) %
Dec 31, 2021
13.9


6.9


(5.6
)
Sep 30, 2021
10.8


5.4


(3.8
)
Jun 30, 2021
11.4


5.8


(3.3
)
Mar 31, 2021
10.7


5.4


(3.6
)

TABLE 8: MATURITIES AND SENSITIVITIES TO CHANGES IN INTEREST RATES

Loans repricing or maturity period

As of March 31, 2022

One year or
less

From one to
five years

From five to
fifteen years

After fifteen
years

Total

(In thousands)

Commercial

Fixed rate

459,243

2,128,103

1,317,788

11,690

3,916,824

Fixed rate - PPP

14,053

239,911

—

253,964

Variable rate

7,410,135

2,985

—

7,413,175

Total commercial

7,883,431

2,370,999

1,317,843

11,690

11,583,963

Commercial real estate

Fixed rate

445,996

2,464,523

528,599

38,784

3,477,902

Variable rate

5,740,276

16,896

—

5,757,172

Total commercial real estate

6,186,272

2,481,419

528,599

38,784

9,235,074

Home equity

Fixed rate

13,341

3,596

16,984

Variable rate

304,451

—

304,451

Total home equity

317,792

3,596

321,435

Residential real estate

Fixed rate

15,634

5,566

29,696

925,814

976,710

Variable rate

61,274

215,288

546,713

—

823,275

Total residential real estate

76,908

220,854

576,409

925,814

1,799,985

Premium finance receivables - property & casualty

Fixed rate

4,794,729

142,679

—

4,937,408

Variable rate

—

Total premium finance receivables - property & casualty

4,794,729

142,679

—

4,937,408

Premium finance receivables - life insurance

Fixed rate

8,668

486,604

21,756

—

517,028

Variable rate

6,837,135

—

6,837,135

Total premium finance receivables - life insurance

6,845,803

486,604

21,756

—

7,354,163

Consumer and other

Fixed rate

19,937

5,204

494

25,725

Variable rate

22,794

—

22,794

Total consumer and other

42,731

5,204

494

48,519

Total per category

Fixed rate

5,757,548

5,236,275

1,897,936

976,822

13,868,581

Fixed rate - PPP

14,053

239,911

—

253,964

Variable rate

20,376,065

235,169

546,768

—

21,158,002

Total loans, net of unearned income

26,147,666

5,711,355

2,444,704

976,822

35,280,547

Variable Rate Loan Pricing by Index:

Prime

3,399,089

One- month LIBOR

7,944,718

Three- month LIBOR

299,324

Twelve- month LIBOR

6,803,367

U.S. Treasury tenors

115,188

SOFR tenors

1,758,787

Ameribor tenors

221,689

One-month BSBY

7,360

Other

608,480

Total variable rate

21,158,002

LIBOR - London Interbank Offered Rate.
SOFR - Secured Overnight Financing Rate.
Ameribor - American Interbank Offered Rate.
BSBY - Bloomberg Short Term Bank Yield Index.

Graph available at the following link: http://ml.globenewswire.com/Resource/Download/6f805a0f-1ab3-41bc-b7e4-bb73be6c86b3

Source: Bloomberg

As noted in the table on the previous page, the majority of the Company’s portfolio is tied to LIBOR indices which, as shown in the table above, do not mirror the same changes as the Prime rate which has historically moved when the Federal Reserve raises or lowers interest rates. Specifically, the Company has $7.9 billion of variable rate loans tied to one-month LIBOR and $6.8 billion of variable rate loans tied to twelve-month LIBOR. The above chart shows:



Basis Point (bp) Change in


Prime

1-month LIBOR

12-month LIBOR

First Quarter 2022

25
bps
35
bps
152
bps
Fourth Quarter 2021

0

2

34

Third Quarter 2021

0

-2

-1

Second Quarter 2021

0

-1

-3

First Quarter 2021

0

-3

-6

TABLE 9: ALLOWANCE FOR CREDIT LOSSES



Three Months Ended


Mar 31,

Dec 31,

Sep 30,

Jun 30,

Mar 31,
(Dollars in thousands)


2022



2021



2021



2021



2021

Allowance for credit losses at beginning of period

$
299,731


$
296,138


$
304,121


$
321,308


$
379,969

Provision for credit losses


4,106



9,299



(7,916
)


(15,299
)


(45,347
)
Initial allowance for credit losses recognized on PCD assets acquired during the period ⁽¹⁾


—



470



—



—



—

Other adjustments


22



5



(65
)


34



31

Charge-offs:










Commercial


1,414



4,431



1,352



3,237



11,781

Commercial real estate


777



495



406



1,412



980

Home equity


197



135



59



142



—

Residential real estate


466



1,067



10



3



2

Premium finance receivables


1,678



2,314



1,390



2,077



3,239

Consumer and other


193



157



112



104



114

Total charge-offs


4,725



8,599



3,329



6,975



16,116

Recoveries:










Commercial


538



389



816



902



452

Commercial real estate


32



217



373



514



200

Home equity


93



461



313



328



101

Residential real estate


5



85



5



36



204

Premium finance receivables


1,476



1,240



1,728



3,239



1,782

Consumer and other


49



26



92



34



32

Total recoveries


2,193



2,418



3,327



5,053



2,771

Net charge-offs


(2,532
)


(6,181
)


(2
)


(1,922
)


(13,345
)
Allowance for credit losses at period end

$
301,327


$
299,731


$
296,138


$
304,121


$
321,308












Annualized net charge-offs (recoveries) by category as a percentage of its own respective category’s average:
Commercial


0.03
%


0.14
%


0.02
%


0.08
%


0.37
%
Commercial real estate


0.03



0.01



0.00



0.04



0.04

Home equity


0.13



(0.38
)


(0.28
)


(0.20
)


(0.10
)
Residential real estate


0.11



0.25



0.00



(0.01
)


(0.06
)
Premium finance receivables


0.01



0.04



(0.01
)


(0.04
)


0.06

Consumer and other


1.19



0.95



0.26



0.69



0.57

Total loans, net of unearned income


0.03
%


0.07
%


0.00
%


0.02
%


0.17
%











Loans at period end

$
35,280,547


$
34,789,104


$
33,264,043


$
32,911,187


$
33,171,233

Allowance for loan losses as a percentage of loans at period end


0.71
%


0.71
%


0.75
%


0.79
%


0.84
%
Allowance for loan and unfunded lending-related commitment losses as a percentage of loans at period end


0.85



0.86



0.89



0.92



0.97

Allowance for loan and unfunded lending-related commitment losses as a percentage of loans at period end, excluding PPP loans


0.86



0.88



0.92



0.98



1.08

(1) The initial allowance for credit losses on purchased credit deteriorated (“PCD”) loans acquired during the period measured approximately $2.8 million, of which approximately $2.3 million was charged-off related to PCD loans that met the Company’s charge-off policy at the time of acquisition. After considering these loans that were immediately charged-off, the net impact of PCD allowance for credit losses at the acquisition date was approximately $470,000.

TABLE 10: ALLOWANCE AND PROVISION FOR CREDIT LOSSES BY COMPONENT



Three Months Ended


Mar 31,

Dec 31,

Sep 30,

Jun 30,

Mar 31,
(In thousands)


2022



2021



2021



2021



2021

Provision for loan losses

$
5,214


$
4,929


$
(12,410
)

$
(14,731
)

$
(28,351
)
Provision for unfunded lending-related commitments losses


(1,189
)


4,375



4,501



(558
)


(17,035
)
Provision for held-to-maturity securities losses


81



(5
)


(7
)


(10
)


39

Provision for credit losses

$
4,106


$
9,299


$
(7,916
)

$
(15,299
)

$
(45,347
)











Allowance for loan losses

$
250,539


$
247,835


$
248,612


$
261,089


$
277,709

Allowance for unfunded lending-related commitments losses


50,629



51,818



47,443



42,942



43,500

Allowance for loan losses and unfunded lending-related commitments losses


301,168



299,653



296,055



304,031



321,209

Allowance for held-to-maturity securities losses


159



78



83



90



99

Allowance for credit losses

$
301,327


$
299,731


$
296,138


$
304,121


$
321,308

TABLE 11: ALLOWANCE BY LOAN PORTFOLIO

The table below summarizes the calculation of allowance for loan losses and allowance for unfunded lending-related commitments losses for the Company’s loan portfolios as well as core and niche portfolios, as of March 31, 2022, December 31, 2021 and September 30, 2021.


As of Mar 31, 2022
As of Dec 31, 2021
As of Sep 30, 2021
(Dollars in thousands)
Recorded Investment

Calculated Allowance

% of its category’s balance
Recorded Investment

Calculated Allowance

% of its category’s balance
Recorded Investment

Calculated Allowance

% of its category’s balance
Commercial:















Commercial, industrial and other, excluding PPP loans
$
11,329,999

$
120,910

1.07
%
$
11,345,785

$
119,305

1.05
%
$
10,105,984

$
109,780

1.09
%
Commercial PPP loans

253,964


1

0.00


558,283


2

0.00


1,081,988


2

0.00

Commercial real estate:















Construction and development

1,396,406


34,206

2.45


1,356,204


35,206

2.60


1,343,715


34,101

2.54

Non-construction

7,838,668


110,700

1.41


7,634,082


109,377

1.43


7,541,999


105,934

1.40

Home equity

321,435


10,566

3.29


335,155


10,699

3.19


347,662


10,939

3.15

Residential real estate

1,799,985


9,429

0.52


1,637,099


8,782

0.54


1,547,736


16,272

1.05

Premium finance receivables















Commercial insurance loans

4,937,408


14,082

0.29


4,855,487


15,246

0.31


4,616,977


17,996

0.39

Life insurance loans

7,354,163


640

0.01


7,042,810


613

0.01


6,655,453


579

0.01

Consumer and other

48,519


634

1.31


24,199


423

1.75


22,529


452

2.01

Total loans, net of unearned income
$
35,280,547

$
301,168

0.85
%
$
34,789,104

$
299,653

0.86
%
$
33,264,043

$
296,055

0.89
%
Total loans, net of unearned income, excluding PPP loans
$
35,026,583

$
301,167

0.86
%
$
34,230,821

$
299,651

0.88
%
$
32,182,055

$
296,053

0.92
%
















Total core loans ⁽¹⁾
$
20,084,782

$
262,447

1.31
%
$
19,599,090

$
260,511

1.33
%
$
18,690,730

$
257,788

1.38
%
Total niche loans ⁽¹⁾

14,941,801


38,720

0.26


14,631,731


39,140

0.27


13,491,325


38,265

0.28

Total PPP loans

253,964


1

0.00


558,283


2

0.00


1,081,988


2

0.00

(1) See Table 1 for additional detail on core and niche loans.

TABLE 12: LOAN PORTFOLIO AGING

(Dollars in thousands)

Mar 31, 2022

Dec 31, 2021

Sep 30, 2021

Jun 30, 2021

Mar 31, 2021
Loan Balances:










Commercial










Nonaccrual

$
16,878

$
20,399

$
26,468

$
23,232

$
22,459
90+ days and still accruing


—


15


—


1,244


—
60-89 days past due


1,294


24,262


9,768


5,204


13,292
30-59 days past due


31,889


43,861


25,224


18,478


35,541
Current


11,533,902


11,815,531


11,126,512


11,394,118


12,636,915
Total commercial

$
11,583,963

$
11,904,068

$
11,187,972

$
11,442,276

$
12,708,207
Commercial real estate










Nonaccrual

$
12,301

$
21,746

$
23,706

$
26,035

$
34,380
90+ days and still accruing


—


—


—


—


—
60-89 days past due


2,648


284


5,395


4,382


8,156
30-59 days past due


30,141


40,443


79,818


19,698


70,168
Current


9,189,984


8,927,813


8,776,795


8,628,254


8,432,075
Total commercial real estate

$
9,235,074

$
8,990,286

$
8,885,714

$
8,678,369

$
8,544,779
Home equity










Nonaccrual

$
1,747

$
2,574

$
3,449

$
3,478

$
5,536
90+ days and still accruing


—


—


164


—


—
60-89 days past due


199


—


340


301


492
30-59 days past due


545


1,120


867


777


780
Current


318,944


331,461


342,842


365,250


383,445
Total home equity

$
321,435

$
335,155

$
347,662

$
369,806

$
390,253
Residential real estate










Early buy-out loans guaranteed by U.S. government agencies ⁽¹⁾

$
50,096

$
30,828

$
26,986

$
50,778

$
51,841
Nonaccrual


7,262


16,440


22,633


23,050


21,553
90+ days and still accruing


—


—


—


—


—
60-89 days past due


293


982


1,540


1,584


944
30-59 days past due


18,808


12,145


1,076


2,139


13,768
Current


1,723,526


1,576,704


1,495,501


1,452,734


1,333,867
Total residential real estate

$
1,799,985

$
1,637,099

$
1,547,736

$
1,530,285

$
1,421,973
Premium finance receivables










Nonaccrual

$
6,707

$
5,433

$
7,300

$
6,418

$
9,690
90+ days and still accruing


12,363


7,217


5,811


3,570


4,783
60-89 days past due


31,291


28,104


15,804


7,759


5,113
30-59 days past due


36,800


89,070


21,654


32,758


31,373
Current


12,204,410


11,768,473


11,221,861


10,830,922


10,019,079
Total premium finance receivables

$
12,291,571

$
11,898,297

$
11,272,430

$
10,881,427

$
10,070,038
Consumer and other










Nonaccrual

$
4

$
477

$
384

$
485

$
497
90+ days and still accruing


43


137


126


178


161
60-89 days past due


5


34


16


22


8
30-59 days past due


221


509


125


75


74
Current


48,246


23,042


21,878


8,264


35,243
Total consumer and other

$
48,519

$
24,199

$
22,529

$
9,024

$
35,983
Total loans, net of unearned income










Early buy-out loans guaranteed by U.S. government agencies ⁽¹⁾

$
50,096

$
30,828

$
26,986

$
50,778

$
51,841
Nonaccrual


44,899


67,069


83,940


82,698


94,115
90+ days and still accruing


12,406


7,369


6,101


4,992


4,944
60-89 days past due


35,730


53,666


32,863


19,252


28,005
30-59 days past due


118,404


187,148


128,764


73,925


151,704
Current


35,019,012


34,443,024


32,985,389


32,679,542


32,840,624
Total loans, net of unearned income

$
35,280,547

$
34,789,104

$
33,264,043

$
32,911,187

$
33,171,233

(1) Early buy-out loans are insured or guaranteed by the FHA or the U.S. Department of Veterans Affairs, subject to indemnifications and insurance limits for certain loans.

TABLE 13: NON-PERFORMING ASSETS ⁽¹⁾ AND TROUBLED DEBT RESTRUCTURINGS (“TDRs”)


Mar 31,

Dec 31,

Sep 30,

Jun 30,

Mar 31,
(Dollars in thousands)

2022



2021



2021



2021



2021

Loans past due greater than 90 days and still accruing ⁽²⁾ :









Commercial
$
—


$
15


$
—


$
1,244


$
—

Commercial real estate

—



—



—



—



—

Home equity

—



—



164



—



—

Residential real estate

—



—



—



—



—

Premium finance receivables

12,363



7,217



5,811



3,570



4,783

Consumer and other

43



137



126



178



161

Total loans past due greater than 90 days and still accruing

12,406



7,369



6,101



4,992



4,944

Non-accrual loans:









Commercial

16,878



20,399



26,468



23,232



22,459

Commercial real estate

12,301



21,746



23,706



26,035



34,380

Home equity

1,747



2,574



3,449



3,478



5,536

Residential real estate

7,262



16,440



22,633



23,050



21,553

Premium finance receivables

6,707



5,433



7,300



6,418



9,690

Consumer and other

4



477



384



485



497

Total non-accrual loans

44,899



67,069



83,940



82,698



94,115

Total non-performing loans:









Commercial

16,878



20,414



26,468



24,476



22,459

Commercial real estate

12,301



21,746



23,706



26,035



34,380

Home equity

1,747



2,574



3,613



3,478



5,536

Residential real estate

7,262



16,440



22,633



23,050



21,553

Premium finance receivables

19,070



12,650



13,111



9,988



14,473

Consumer and other

47



614



510



663



658

Total non-performing loans
$
57,305


$
74,438


$
90,041


$
87,690


$
99,059

Other real estate owned

4,978



1,959



9,934



10,510



8,679

Other real estate owned - from acquisitions

1,225



2,312



3,911



5,062



7,134

Other repossessed assets

—



—



—



—



—

Total non-performing assets
$
63,508


$
78,709


$
103,886


$
103,262


$
114,872

Accruing TDRs not included within non-performing assets
$
35,922


$
37,486


$
38,468


$
44,019


$
46,151

Total non-performing loans by category as a percent of its own respective category’s period-end balance:









Commercial

0.15
%


0.17
%


0.24
%


0.21
%


0.18
%
Commercial real estate

0.13



0.24



0.27



0.30



0.40

Home equity

0.54



0.77



1.04



0.94



1.42

Residential real estate

0.40



1.00



1.46



1.51



1.52

Premium finance receivables

0.16



0.11



0.12



0.09



0.14

Consumer and other

0.10



2.54



2.26



7.35



1.83

Total loans, net of unearned income

0.16
%


0.21
%


0.27
%


0.27
%


0.30
%
Total non-performing assets as a percentage of total assets

0.13
%


0.16
%


0.22
%


0.22
%


0.25
%
Allowance for loan losses and unfunded lending-related commitments losses as a percentage of non-accrual loans

670.77
%


446.78
%


352.70
%


367.64
%


341.29
%

(1) Excludes early buy-out loans guaranteed by U.S. government agencies. Early buy-out loans are insured or guaranteed by the FHA or the U.S. Department of Veterans Affairs, subject to indemnifications and insurance limits for certain loans.
(2) As of March 31, 2022, December 31, 2021, September 30, 2021, and June 2021, approximately $320,000, $320,000, $445,000 and $320,000, respectively, of TDRs were past due greater than 90 days and still accruing interest. No TDRs as of March 31, 2021 were past due greater than 90 days and still accruing interest.

Non-performing Loans Rollforward, excluding early buy-out loans guaranteed by U.S. government agencies


Three Months Ended

Mar 31,

Dec 31,

Sep 30,

Jun 30,

Mar 31,
(In thousands)

2022



2021



2021



2021



2021











Balance at beginning of period
$
74,438


$
90,041


$
87,690


$
99,059


$
127,513

Additions from becoming non-performing in the respective period

4,141



6,851



9,341



12,762



9,894

Return to performing status

(729
)


(6,616
)


(3,322
)


—



(654
)
Payments received

(20,139
)


(13,212
)


(5,568
)


(12,312
)


(22,731
)
Transfer to OREO and other repossessed assets

(4,377
)


(275
)


(720
)


(3,660
)


(1,372
)
Charge-offs, net

(2,354
)


(5,167
)


(548
)


(4,684
)


(2,952
)
Net change for niche loans ⁽¹⁾

6,325



2,816



3,168



(3,475
)


(10,639
)
Balance at end of period
$
57,305


$
74,438


$
90,041


$
87,690


$
99,059

(1) This includes activity for premium finance receivables and indirect consumer loans.

TDRs


Mar 31,

Dec 31,

Sep 30,

Jun 30,

Mar 31,
(In thousands)

2022


2021


2021


2021


2021
Accruing TDRs:









Commercial
$
2,773

$
4,131

$
4,532

$
6,911

$
7,536
Commercial real estate

10,068


8,421


8,385


9,659


9,478
Residential real estate and other

23,081


24,934


25,551


27,449


29,137
Total accrual
$
35,922

$
37,486

$
38,468

$
44,019

$
46,151
Non-accrual TDRs: ⁽¹⁾









Commercial
$
4,935

$
6,746

$
3,079

$
4,104

$
5,583
Commercial real estate

2,050


2,050


3,239


3,434


1,309
Residential real estate and other

1,964


3,027


3,685


4,190


3,540
Total non-accrual
$
8,949

$
11,823

$
10,003

$
11,728

$
10,432
Total TDRs:









Commercial
$
7,708

$
10,877

$
7,611

$
11,015

$
13,119
Commercial real estate

12,118


10,471


11,624


13,093


10,787
Residential real estate and other

25,045


27,961


29,236


31,639


32,677
Total TDRs
$
44,871

$
49,309

$
48,471

$
55,747

$
56,583

(1) Included in total non-performing loans.

Other Real Estate Owned


Three Months Ended

Mar 31,

Dec 31,

Sep 30,

Jun 30,

Mar 31,
(In thousands)

2022



2021



2021



2021



2021

Balance at beginning of period
$
4,271


$
13,845


$
15,572


$
15,813


$
16,558

Disposals/resolved

(2,497
)


(9,664
)


(1,949
)


(3,152
)


(2,162
)
Transfers in at fair value, less costs to sell

4,429



275



315



3,660



1,587

Fair value adjustments

—



(185
)


(93
)


(749
)


(170
)
Balance at end of period
$
6,203


$
4,271


$
13,845


$
15,572


$
15,813












Period End

Mar 31,

Dec 31,

Sep 30,

Jun 30,

Mar 31,
Balance by Property Type:

2022



2021



2021



2021



2021

Residential real estate
$
1,127


$
1,310


$
1,592


$
1,952


$
2,713

Residential real estate development

—



—



934



1,030



1,287

Commercial real estate

5,076



2,961



11,319



12,590



11,813

Total
$
6,203


$
4,271


$
13,845


$
15,572


$
15,813

TABLE 14: NON-INTEREST INCOME


Three Months Ended

Q1 2022 compared to Q4 2021

Q1 2022 compared to Q1 2021

Mar 31,

Dec 31,

Sep 30,

Jun 30,

Mar 31,


(Dollars in thousands)

2022



2021



2021



2021



2021


$ Change

% Change

$ Change

% Change
Brokerage
$
4,632


$
5,292


$
5,230


$
5,148


$
5,040


$
(660
)

(12
)%

$
(408
)

(8
)%
Trust and asset management

26,762



27,197



26,301



25,542



24,269



(435
)

(2
)


2,493


10

Total wealth management

31,394



32,489



31,531



30,690



29,309



(1,095
)

(3
)


2,085


7

Mortgage banking

77,231



53,138



55,794



50,584



113,494



24,093


45



(36,263
)

(32
)
Service charges on deposit accounts

15,283



14,734



14,149



13,249



12,036



549


4



3,247


27

(Losses) gains on investment securities, net

(2,782
)


(1,067
)


(2,431
)


1,285



1,154



(1,715
)

NM



(3,936
)

NM

Fees from covered call options

3,742



1,128



1,157



1,388



—



2,614


NM



3,742


NM

Trading gains (losses), net

3,889



206



58



(438
)


419



3,683


NM



3,470


NM

Operating lease income, net

15,475



14,204



12,807



12,240



14,440



1,271


9



1,035


7

Other:

















Interest rate swap fees

4,569



3,526



4,868



2,820



2,488



1,043


30



2,081


84

BOLI

48



1,192



2,154



1,342



1,124



(1,144
)

(96
)


(1,076
)

(96
)
Administrative services

1,853



1,846



1,359



1,228



1,256



7


—



597


48

Foreign currency remeasurement gains (losses)

11



111



77



(782
)


99



(100
)

(90
)


(88
)

(89
)
Early pay-offs of capital leases

265



249



209



195



(52
)


16


6



317


NM

Miscellaneous

11,812



12,011



14,742



15,572



10,739



(199
)

(2
)


1,073


10

Total Other

18,558



18,935



23,409



20,375



15,654



(377
)

(2
)


2,904


19

Total Non-Interest Income
$
162,790


$
133,767


$
136,474


$
129,373


$
186,506


$
29,023


22
%

$
(23,716
)

(13
)%

NM - Not meaningful.

TABLE 15: MORTGAGE BANKING


Three Months Ended
(Dollars in thousands)
Mar 31, 2022

Dec 31, 2021

Sep 30, 2021

Jun 30, 2021

Mar 31, 2021
Originations:









Retail originations
$
647,785


$
980,627


$
1,153,265


$
1,328,721


$
1,641,664

Veterans First originations

247,738



318,244



405,663



395,290



580,303

Total originations for sale (A)
$
895,523


$
1,298,871


$
1,558,928


$
1,724,011


$
2,221,967

Originations for investment

274,628



177,676



181,886



249,749



321,858

Total originations
$
1,170,151


$
1,476,547


$
1,740,814


$
1,973,760


$
2,543,825











Retail originations as percentage of originations for sale

72
%


75
%


74
%


77
%


74
%
Veterans First originations as a percentage of originations for sale

28



25



26



23



26











Purchases as a percentage of originations for sale

53
%


52
%


56
%


53
%


27
%
Refinances as a percentage of originations for sale

47



48



44



47



73











Production Margin:









Production revenue (B) ⁽¹⁾
$
14,585


$
28,182


$
39,247


$
37,531


$
71,282











Total originations for sale (A)
$
895,523


$
1,298,871


$
1,558,928


$
1,724,011


$
2,221,967

Add: Current period end mandatory interest rate lock commitments to fund originations for sale ⁽²⁾

330,196



353,509



510,982



605,400



798,534

Less: Prior period end mandatory interest rate lock commitments to fund originations for sale ⁽²⁾

353,509



510,982



605,400



798,534



1,072,717

Total mortgage production volume (C)
$
872,210


$
1,141,398


$
1,464,510


$
1,530,877


$
1,947,784











Production margin (B / C)

1.67
%


2.47
%


2.68
%


2.45
%


3.66
%










Mortgage Servicing:









Loans serviced for others (D)
$
13,426,535


$
13,126,254


$
12,720,126


$
12,307,337


$
11,530,676

MSRs, at fair value (E)

199,146



147,571



133,552



127,604



124,316

Percentage of MSRs to loans serviced for others (E / D)

1.48
%


1.12
%


1.05
%


1.04
%


1.08
%
Servicing income
$
10,851


$
10,766


$
10,454


$
9,830


$
9,636











Components of MSR:









MSR - current period capitalization
$
14,401


$
15,080


$
15,546


$
17,512


$
24,616

MSR - collection of expected cash flows - paydowns

(1,215
)


(1,101
)


(1,036
)


(991
)


(728
)
MSR - collection of expected cash flows - payoffs

(4,801
)


(6,385
)


(7,558
)


(7,549
)


(9,440
)
MSR - changes in fair value model assumptions

43,365



6,656



(888
)


(5,540
)


18,045











Summary of Mortgage Banking Revenue:









Production revenue ⁽¹⁾
$
14,585


$
28,182


$
39,247


$
37,531


$
71,282

Servicing income

10,851



10,766



10,454



9,830



9,636

MSR activity

51,750



14,250



6,064



3,432



32,493

Other

45



(60
)


29



(209
)


83

Total mortgage banking revenue
$
77,231


$
53,138


$
55,794


$
50,584


$
113,494

(1) Production revenue represents revenue earned from the origination and subsequent sale of mortgages, including gains on loans sold and fees from originations, changes in other related financial instruments carried at fair value, processing and other related activities, and excludes servicing fees, changes in the fair value of servicing rights and changes to the mortgage recourse obligation and other non-production revenue.
(2) Certain volume adjusted for the estimated pull-through rate of the loan, which represents the Company’s best estimate of the likelihood that a committed loan will ultimately fund.

TABLE 16: NON-INTEREST EXPENSE


Three Months Ended

Q1 2022 compared to Q4 2021

Q1 2022 compared to Q1 2021

Mar 31,

Dec 31,

Sep 30,

Jun 30,

Mar 31,


(Dollars in thousands)

2022



2021



2021



2021


2021


$ Change

% Change

$ Change

% Change
Salaries and employee benefits:

















Salaries
$
92,116


$
91,612


$
88,161


$
91,089

$
91,053


$
504


1
%

$
1,063


1
%
Commissions and incentive compensation

51,793



49,923



57,026



53,751


61,367



1,870


4



(9,574
)

(16
)
Benefits

28,446



25,596



25,725



27,977


28,389



2,850


11



57


—

Total salaries and employee benefits

172,355



167,131



170,912



172,817


180,809



5,224


3



(8,454
)

(5
)
Software and equipment

22,810



23,708



22,029



20,866


20,912



(898
)

(4
)


1,898


9

Operating lease equipment depreciation

9,708



10,147



10,013



9,949


10,771



(439
)

(4
)


(1,063
)

(10
)
Occupancy, net

17,824



18,343



18,158



17,687


19,996



(519
)

(3
)


(2,172
)

(11
)
Data processing

7,505



7,207



7,104



6,920


6,048



298


4



1,457


24

Advertising and marketing

11,924



13,981



13,443



11,305


8,546



(2,057
)

(15
)


3,378


40

Professional fees

8,401



7,551



7,052



7,304


7,587



850


11



814


11

Amortization of other acquisition-related intangible assets

1,609



1,811



1,877



2,039


2,007



(202
)

(11
)


(398
)

(20
)
FDIC insurance

7,729



7,317



6,750



6,405


6,558



412


6



1,171


18

OREO expense, net

(1,032
)


(641
)


(1,531
)


769


(251
)


(391
)

61



(781
)

NM

Other:

















Commissions - 3rd party brokers

917



861



884



889


846



56


7



71


8

Postage

1,416



1,684



2,018



1,900


1,743



(268
)

(16
)


(327
)

(19
)
Miscellaneous

23,132



24,299



23,435



21,262


21,317



(1,167
)

(5
)


1,815


9

Total other

25,465



26,844



26,337



24,051


23,906



(1,379
)

(5
)


1,559


7

Total Non-Interest Expense
$
284,298


$
283,399


$
282,144


$
280,112

$
286,889


$
899


0
%

$
(2,591
)

(1
)%

NM - Not meaningful.

TABLE 17: SUPPLEMENTAL NON-GAAP FINANCIAL MEASURES/RATIOS

The accounting and reporting policies of Wintrust conform to generally accepted accounting principles (“GAAP”) in the United States and prevailing practices in the banking industry. However, certain non-GAAP performance measures and ratios are used by management to evaluate and measure the Company’s performance. These include taxable-equivalent net interest income (including its individual components), taxable-equivalent net interest margin (including its individual components), the taxable-equivalent efficiency ratio, tangible common equity ratio, tangible book value per common share, return on average tangible common equity, and pre-tax income, excluding provision for credit losses. Management believes that these measures and ratios provide users of the Company’s financial information a more meaningful view of the performance of the Company’s interest-earning assets and interest-bearing liabilities and of the Company’s operating efficiency. Other financial holding companies may define or calculate these measures and ratios differently.

Management reviews yields on certain asset categories and the net interest margin of the Company and its banking subsidiaries on a fully taxable-equivalent basis. In this non-GAAP presentation, net interest income is adjusted to reflect tax-exempt interest income on an equivalent before-tax basis using tax rates effective as of the end of the period. This measure ensures comparability of net interest income arising from both taxable and tax-exempt sources. Net interest income on a fully taxable-equivalent basis is also used in the calculation of the Company’s efficiency ratio. The efficiency ratio, which is calculated by dividing non-interest expense by total taxable-equivalent net revenue (less securities gains or losses), measures how much it costs to produce one dollar of revenue. Securities gains or losses are excluded from this calculation to better match revenue from daily operations to operational expenses. Management considers the tangible common equity ratio and tangible book value per common share as useful measurements of the Company’s equity. The Company references the return on average tangible common equity as a measurement of profitability. Management considers pre-tax income, excluding provision for credit losses, as a useful measurement of the Company’s core net income.


Three Months Ended

Mar 31,

Dec 31,

Sep 30,

Jun 30,

Mar 31,
(Dollars and shares in thousands)

2022



2021



2021



2021



2021

Reconciliation of Non-GAAP Net Interest Margin and Efficiency Ratio:
(A) Interest Income (GAAP)
$
328,252


$
327,979


$
322,457


$
319,579


$
305,469

Taxable-equivalent adjustment:









- Loans

427



417



411



415



384

- Liquidity Management Assets

465



486



492



494



500

- Other Earning Assets

2



2



—



—



—

(B) Interest Income (non-GAAP)
$
329,146


$
328,884


$
323,360


$
320,488


$
306,353

(C) Interest Expense (GAAP)

28,958



32,003



34,961



39,989



43,574

(D) Net Interest Income (GAAP) (A minus C)
$
299,294


$
295,976


$
287,496


$
279,590


$
261,895

(E) Net Interest Income (non-GAAP) (B minus C)
$
300,188


$
296,881


$
288,399


$
280,499


$
262,779

Net interest margin (GAAP)

2.60
%


2.54
%


2.58
%


2.62
%


2.53
%
Net interest margin, fully taxable-equivalent (non-GAAP)

2.61



2.55



2.59



2.63



2.54

(F) Non-interest income
$
162,790


$
133,767


$
136,474


$
129,373


$
186,506

(G) (Losses) gains on investment securities, net

(2,782
)


(1,067
)


(2,431
)


1,285



1,154

(H) Non-interest expense

284,298



283,399



282,144



280,112



286,889

Efficiency ratio (H/(D+F-G))

61.16
%


65.78
%


66.17
%


68.71
%


64.15
%
Efficiency ratio (non-GAAP) (H/(E+F-G))

61.04



65.64



66.03



68.56



64.02











Reconciliation of Non-GAAP Tangible Common Equity Ratio:
Total shareholders’ equity (GAAP)
$
4,492,256


$
4,498,688


$
4,410,317


$
4,339,011


$
4,252,511

Less: Non-convertible preferred stock (GAAP)

(412,500
)


(412,500
)


(412,500
)


(412,500
)


(412,500
)
Less: Intangible assets (GAAP)

(682,101
)


(683,456
)


(675,910
)


(678,333
)


(680,052
)
(I) Total tangible common shareholders’ equity (non-GAAP)
$
3,397,655


$
3,402,732


$
3,321,907


$
3,248,178


$
3,159,959

(J) Total assets (GAAP)
$
50,250,661


$
50,142,143


$
47,832,271


$
46,738,450


$
45,682,202

Less: Intangible assets (GAAP)

(682,101
)


(683,456
)


(675,910
)


(678,333
)


(680,052
)
(K) Total tangible assets (non-GAAP)
$
49,568,560


$
49,458,687


$
47,156,361


$
46,060,117


$
45,002,150

Common equity to assets ratio (GAAP) (L/J)

8.1
%


8.1
%


8.4
%


8.4
%


8.4
%
Tangible common equity ratio (non-GAAP) (I/K)

6.9



6.9



7.0



7.1



7.0


Three Months Ended

Mar 31,

Dec 31,

Sep 30,

Jun 30,

Mar 31,
(Dollars and shares in thousands)

2022



2021



2021



2021



2021

Reconciliation of Non-GAAP Tangible Book Value per Common Share:
Total shareholders’ equity
$
4,492,256


$
4,498,688


$
4,410,317


$
4,339,011


$
4,252,511

Less: Preferred stock

(412,500
)


(412,500
)


(412,500
)


(412,500
)


(412,500
)
(L) Total common equity
$
4,079,756


$
4,086,188


$
3,997,817


$
3,926,511


$
3,840,011

(M) Actual common shares outstanding

57,253



57,054



56,956



57,067



57,023

Book value per common share (L/M)
$
71.26


$
71.62


$
70.19


$
68.81


$
67.34

Tangible book value per common share (non-GAAP) (I/M)

59.34



59.64



58.32



56.92



55.42











Reconciliation of Non-GAAP Return on Average Tangible Common Equity:
(N) Net income applicable to common shares
$
120,400


$
91,766


$
102,146


$
98,118


$
146,157

Add: Intangible asset amortization

1,609



1,811



1,877



2,039



2,007

Less: Tax effect of intangible asset amortization

(430
)


(505
)


(509
)


(553
)


(522
)
After-tax intangible asset amortization
$
1,179


$
1,306


$
1,368


$
1,486


$
1,485

(O) Tangible net income applicable to common shares (non-GAAP)
$
121,579


$
93,072


$
103,514


$
99,604


$
147,642

Total average shareholders’ equity
$
4,500,460


$
4,433,953


$
4,343,915


$
4,256,778


$
4,164,890

Less: Average preferred stock

(412,500
)


(412,500
)


(412,500
)


(412,500
)


(412,500
)
(P) Total average common shareholders’ equity
$
4,087,960


$
4,021,453


$
3,931,415


$
3,844,278


$
3,752,390

Less: Average intangible assets

(682,603
)


(677,470
)


(677,201
)


(679,535
)


(680,805
)
(Q) Total average tangible common shareholders’ equity (non-GAAP)
$
3,405,357


$
3,343,983


$
3,254,214


$
3,164,743


$
3,071,585

Return on average common equity, annualized (N/P)

11.94
%


9.05
%


10.31
%


10.24
%


15.80
%
Return on average tangible common equity, annualized (non-GAAP) (O/Q)

14.48



11.04



12.62



12.62



19.49











Reconciliation of Non-GAAP Pre-Tax, Pre-Provision Income:


Income before taxes
$
173,680


$
137,045


$
149,742


$
144,150


$
206,859

Add: Provision for credit losses

4,106



9,299



(7,916
)


(15,299
)


(45,347
)
Pre-tax income, excluding provision for credit losses (non-GAAP)
$
177,786


$
146,344


$
141,826


$
128,851


$
161,512

WINTRUST SUBSIDIARIES AND LOCATIONS

Wintrust is a financial holding company whose common stock is traded on the Nasdaq Global Select Market (Nasdaq: WTFC). Its 15 community bank subsidiaries are: Lake Forest Bank & Trust Company, N.A., Hinsdale Bank & Trust Company, N.A., Wintrust Bank, N.A., in Chicago, Libertyville Bank & Trust Company, N.A., Barrington Bank & Trust Company, N.A., Crystal Lake Bank & Trust Company, N.A., Northbrook Bank & Trust Company, N.A., Schaumburg Bank & Trust Company, N.A., Village Bank & Trust, N.A., in Arlington Heights, Beverly Bank & Trust Company, N.A. in Chicago, Wheaton Bank & Trust Company, N.A., State Bank of The Lakes, N.A., in Antioch, Old Plank Trail Community Bank, N.A. in New Lenox, St. Charles Bank & Trust Company, N.A. and Town Bank, N.A., in Hartland, Wisconsin.

In addition to the locations noted above, the banks also operate facilities in Illinois in Addison, Algonquin, Aurora, Bloomingdale, Bolingbrook, Buffalo Grove, Burbank, Cary, Clarendon Hills, Crete, Countryside, Darien, Deerfield, Des Plaines, Downers Grove, Elgin, Elk Grove Village, Elmhurst, Evanston, Evergreen Park, Frankfort, Geneva, Glen Ellyn, Glencoe, Glenview, Gurnee, Grayslake, Hanover Park, Highland Park, Highwood, Hoffman Estates, Homer Glen, Itasca, Joliet, Lake Bluff, Lake Villa, Lansing, Lemont, Lindenhurst, Lynwood, Markham, Maywood, McHenry, Mokena, Mount Prospect, Mundelein, Naperville, Northfield, Norridge, Oak Lawn, Oak Park, Orland Park, Palatine, Park Ridge, Prospect Heights, Riverside, Rockford, Rolling Meadows, Round Lake Beach, Shorewood, Skokie, South Holland, Spring Grove, Steger, Stone Park, Vernon Hills, Wauconda, Waukegan, Western Springs, Willowbrook, Wilmette, Winnetka and Wood Dale, and in Wisconsin in Burlington, Clinton, Delafield, Delavan, Elm Grove, Genoa City, Kenosha, Lake Geneva, Madison, Menomonee Falls, Milwaukee, Pewaukee, Racine, Wales, Walworth, Whitefish Bay and Wind Lake, and in Dyer, Indiana and in Naples, Florida.

Additionally, the Company operates various non-bank business units:

FIRST Insurance Funding and Wintrust Life Finance, each a division of Lake Forest Bank & Trust Company, N.A., serve commercial and life insurance loan customers, respectively, throughout the United States.
First Insurance Funding of Canada serves commercial insurance loan customers throughout Canada.
Tricom, Inc. of Milwaukee provides high-yielding, short-term accounts receivable financing and value-added out-sourced administrative services, such as data processing of payrolls, billing and cash management services, to temporary staffing service clients located throughout the United States.
Wintrust Mortgage, a division of Barrington Bank & Trust Company, N.A., engages primarily in the origination and purchase of residential mortgages for sale into the secondary market through origination offices located throughout the United States. Loans are also originated nationwide through relationships with wholesale and correspondent offices.
Wintrust Investments, LLC is a broker-dealer providing a full range of private client and brokerage services to clients and correspondent banks located primarily in the Midwest.
Great Lakes Advisors LLC provides money management services and advisory services to individual accounts.
The Chicago Trust Company, N.A., a trust subsidiary, allows Wintrust to service customers’ trust and investment needs at each banking location.
Wintrust Asset Finance offers direct leasing opportunities.
CDEC provides Qualified Intermediary services (as defined by U.S. Treasury regulations) for taxpayers seeking to structure tax-deferred like-kind exchanges under Internal Revenue Code Section 1031.

FORWARD-LOOKING STATEMENTS

This document contains forward-looking statements within the meaning of federal securities laws. Forward-looking information can be identified through the use of words such as “intend,” “plan,” “project,” “expect,” “anticipate,” “believe,” “estimate,” “contemplate,” “possible,” “will,” “may,” “should,” “would” and “could.” Forward-looking statements and information are not historical facts, are premised on many factors and assumptions, and represent only management’s expectations, estimates and projections regarding future events. Similarly, these statements are not guarantees of future performance and involve certain risks and uncertainties that are difficult to predict, such as the impacts of the COVID-19 pandemic (including the emergence of variant strains), and which may include, but are not limited to, those listed below and the Risk Factors discussed under Item 1A of the Company’s 2021 Annual Report on Form 10-K and in any of the Company’s subsequent SEC filings. The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and is including this statement for purposes of invoking these safe harbor provisions. Such forward-looking statements may be deemed to include, among other things, statements relating to the Company’s future financial performance, the performance of its loan portfolio, the expected amount of future credit reserves and charge-offs, delinquency trends, growth plans, regulatory developments, securities that the Company may offer from time to time, and management’s long-term performance goals, as well as statements relating to the anticipated effects on financial condition and results of operations from expected developments or events, the Company’s business and growth strategies, including future acquisitions of banks, specialty finance or wealth management businesses, internal growth and plans to form additional de novo banks or branch offices. Actual results could differ materially from those addressed in the forward-looking statements as a result of numerous factors, including the following:

the severity, magnitude and duration of the COVID-19 pandemic, including the emergence of variant strains, and the direct and indirect impact of such pandemic, as well as responses to the pandemic by the government, businesses and consumers, on our operations and personnel, commercial activity and demand across our business and our customers’ businesses;
the disruption of global, national, state and local economies associated with the COVID-19 pandemic, which could affect the Company’s liquidity and capital positions, impair the ability of our borrowers to repay outstanding loans, impair collateral values and further increase our allowance for credit losses;
the impact of the COVID-19 pandemic on our financial results, including possible lost revenue and increased expenses (including the cost of capital), as well as possible goodwill impairment charges;
economic conditions that affect the economy, housing prices, the job market and other factors that may adversely affect the Company’s liquidity and the performance of its loan portfolios, particularly in the markets in which it operates;
negative effects suffered by us or our customers resulting from changes in U.S. trade policies;
the extent of defaults and losses on the Company’s loan portfolio, which may require further increases in its allowance for credit losses;
estimates of fair value of certain of the Company’s assets and liabilities, which could change in value significantly from period to period;
the financial success and economic viability of the borrowers of our commercial loans;
commercial real estate market conditions in the Chicago metropolitan area and southern Wisconsin;
the extent of commercial and consumer delinquencies and declines in real estate values, which may require further increases in the Company’s allowance for credit losses;
inaccurate assumptions in our analytical and forecasting models used to manage our loan portfolio;
changes in the level and volatility of interest rates, the capital markets and other market indices (including developments and volatility arising from or related to the COVID-19 pandemic) that may affect, among other things, the Company’s liquidity and the value of its assets and liabilities;
the interest rate environment, including a prolonged period of low interest rates or rising interest rates, either broadly or for some types of instruments, which may affect the Company’s net interest income and net interest margin, and which could materially adversely affect the Company’s profitability;
competitive pressures in the financial services business which may affect the pricing of the Company’s loan and deposit products as well as its services (including wealth management services), which may result in loss of market share and reduced income from deposits, loans, advisory fees and income from other products;
failure to identify and complete favorable acquisitions in the future or unexpected difficulties or developments related to the integration of the Company’s recent or future acquisitions;
unexpected difficulties and losses related to FDIC-assisted acquisitions;
harm to the Company’s reputation;
any negative perception of the Company’s financial strength;
ability of the Company to raise additional capital on acceptable terms when needed;
disruption in capital markets, which may lower fair values for the Company’s investment portfolio;
ability of the Company to use technology to provide products and services that will satisfy customer demands and create efficiencies in operations and to manage risks associated therewith;
failure or breaches of our security systems or infrastructure, or those of third parties;
security breaches, including denial of service attacks, hacking, social engineering attacks, malware intrusion or data corruption attempts and identity theft;
adverse effects on our information technology systems resulting from failures, human error or cyberattacks (including ransomware);
adverse effects of failures by our vendors to provide agreed upon services in the manner and at the cost agreed, particularly our information technology vendors;
increased costs as a result of protecting our customers from the impact of stolen debit card information;
accuracy and completeness of information the Company receives about customers and counterparties to make credit decisions;
ability of the Company to attract and retain senior management experienced in the banking and financial services industries;
environmental liability risk associated with lending activities;
the impact of any claims or legal actions to which the Company is subject, including any effect on our reputation;
losses incurred in connection with repurchases and indemnification payments related to mortgages and increases in reserves associated therewith;
the loss of customers as a result of technological changes allowing consumers to complete their financial transactions without the use of a bank;
the soundness of other financial institutions;
the expenses and delayed returns inherent in opening new branches and de novo banks;
liabilities, potential customer loss or reputational harm related to closings of existing branches;
examinations and challenges by tax authorities, and any unanticipated impact of the Tax Act;
changes in accounting standards, rules and interpretations, and the impact on the Company’s financial statements;
the ability of the Company to receive dividends from its subsidiaries;
uncertainty about the discontinued use of LIBOR and transition to an alternative rate;
a decrease in the Company’s capital ratios, including as a result of declines in the value of its loan portfolios, or otherwise;
legislative or regulatory changes, particularly changes in regulation of financial services companies and/or the products and services offered by financial services companies, including those changes that are in response to the COVID-19 pandemic, including without limitation the Coronavirus Aid, Relief, and Economic Security Act, the Economic Aid to Hard-Hit Small Businesses, Nonprofits and Venues Act, and the rules and regulations that may be promulgated thereunder;
a lowering of our credit rating;
changes in U.S. monetary policy and changes to the Federal Reserve’s balance sheet, including changes in response to the COVID-19 pandemic, persistent inflation or otherwise;
regulatory restrictions upon our ability to market our products to consumers and limitations on our ability to profitably operate our mortgage business;
increased costs of compliance, heightened regulatory capital requirements and other risks associated with changes in regulation and the regulatory environment;
the impact of heightened capital requirements;
increases in the Company’s FDIC insurance premiums, or the collection of special assessments by the FDIC;
delinquencies or fraud with respect to the Company’s premium finance business;
credit downgrades among commercial and life insurance providers that could negatively affect the value of collateral securing the Company’s premium finance loans;
the Company’s ability to comply with covenants under its credit facility;
fluctuations in the stock market, which may have an adverse impact on the Company’s wealth management business and brokerage operation; and
widespread outages of operational, communication, or other systems, whether internal or provided by third parties, natural or other disasters (including acts of terrorism, armed hostilities and pandemics), and the effects of climate change could have an adverse effect on the Company’s financial condition and results of operations, lead to material disruption of the Company’s operations or the ability or willingness of clients to access the Company’s products and services.

Therefore, there can be no assurances that future actual results will correspond to these forward-looking statements. The reader is cautioned not to place undue reliance on any forward-looking statement made by the Company. Any such statement speaks only as of the date the statement was made or as of such date that may be referenced within the statement. The Company undertakes no obligation to update any forward-looking statement to reflect the impact of circumstances or events after the date of the press release. Persons are advised, however, to consult further disclosures management makes on related subjects in its reports filed with the Securities and Exchange Commission and in its press releases.

CONFERENCE CALL, WEBCAST AND REPLAY

The Company will hold a conference call on Wednesday, April 20, 2022 at 11:00 a.m. (Central Time) regarding first quarter 2022 results. Individuals interested in listening should call (877) 363-5049 and enter Conference ID #6069787. A simultaneous audio-only webcast and replay of the conference call as well as an accompanying slide presentation may be accessed via the Company’s website at https://www.wintrust.com, Investor Relations, Investor News and Events, Presentations & Conference Calls. The text of the first quarter 2022 earnings press release will be available on the home page of the Company’s website at https://www.wintrust.com and at the Investor Relations, Investor News and Events, Press Releases link on its website.

FOR MORE INFORMATION CONTACT:
Edward J. Wehmer, Founder & Chief Executive Officer
David A. Dykstra, Vice Chairman & Chief Operating Officer
(847) 939-9000
Web site address: www.wintrust.com

Company Name:	Wintrust Financial Corporation
Stock Symbol:	WTFC
Market:	NASDAQ
Website:	wintrust.com

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