Press Release

First Hawaiian, Inc. Reports Fourth Quarter 2021 Financial Results and Declares Dividend

First Hawaiian, Inc. Reports Fourth Quarter 2021 Financial Results and Declares Dividend

January 21, 2022 at 8:00 AM EST

HONOLULU, Jan. 21, 2022 (GLOBE NEWSWIRE) -- First Hawaiian, Inc. (NASDAQ:FHB), (“First Hawaiian” or the “Company”) today reported financial results for its quarter ended December 31, 2021.

“We are pleased to report that we closed 2021 with a solid fourth quarter,” said Bob Harrison, Chairman, President and CEO. “We saw strong loan growth, continued to grow consumer and commercial deposits while reducing excess liquidity, and credit quality remained excellent.”

On January 19, 2022 the Company’s Board of Directors declared a quarterly cash dividend of $0.26 per share. The dividend will be payable on March 4, 2022 to stockholders of record at the close of business on February 18, 2022.

Additionally, the Company’s Board of Directors adopted a stock repurchase program for up to $75 million of its outstanding common stock during 2022.

Fourth Quarter 2021 Highlights:

  • Net income of $57.0 million, or $0.44 per diluted share
  • Total loans and leases increased $127.7 million versus prior quarter
  • Total deposits decreased $303.9 million versus prior quarter, reduced public deposits by $978.4 million
  • Incurred a $9.0 million charge in connection with the prepayment of $200.0 million of Federal Home Loan Bank advances at a weighted average rate of 2.73%
  • No provision for credit losses was taken in the quarter
  • Board of Directors declared a quarterly dividend of $0.26 per share
  • Repurchased $21.5 million of stock under share repurchase program

Balance Sheet

Total assets were $25.0 billion as of December 31, 2021, compared to $25.5 billion as of September 30, 2021.

Gross loans and leases were $13.0 billion as of December 31, 2021, an increase of $127.7 million, or 1.0%, from $12.8 billion as of September 30, 2021.

Total deposits were $21.8 billion as of December 31, 2021, a decrease of $303.9 million, or 1.4%, from $22.1 billion as of September 30, 2021.

Net Interest Income

Net interest income for the fourth quarter of 2021 was $137.3 million, an increase of $4.7 million, or 3.6%, compared to $132.6 million for the prior quarter.

The net interest margin (NIM) was 2.38% in the fourth quarter of 2021, an increase of 2 basis points compared to 2.36% in the third quarter of 2021.

Provision Expense

During the quarter ended December 31, 2021, we did not record a provision for credit losses. In the quarter ended September 30, 2021 we recorded a $4.0 million negative provision for credit losses.

Noninterest Income

Noninterest income was $41.6 million in the fourth quarter of 2021, a decrease of $8.5 million compared to noninterest income of $50.1 million in the third quarter of 2021.

Noninterest Expense

Noninterest expense was $108.7 million in the fourth quarter of 2021, an increase of $7.7 million compared to noninterest expense of $101.0 million in the third quarter of 2021.

The efficiency ratio was 60.5% and 55.1% for the quarters ended December 31, 2021 and September 30, 2021, respectively.

Taxes

The effective tax rate was 18.7% for the quarter ended December 31, 2021 and 25.0% for the quarter ended September 30, 2021.

Asset Quality

The allowance for credit losses was $157.3 million, or 1.21% of total loans and leases, as of December 31, 2021, compared to $161.2 million, or 1.26% of total loans and leases, as of September 30, 2021. The reserve for unfunded commitments was $30.3 million as of December 31, 2021 compared to $32.5 million as of September 30, 2021. Net charge-offs were $6.2 million, or 0.19% of average loans and leases on an annualized basis, for the quarter ended December 31, 2021, compared to net charge-offs of $0.6 million, or 0.02% of average loans and leases on an annualized basis, for the quarter ended September 30, 2021. Total non-performing assets were $7.3 million, or 0.06% of total loans and leases and other real estate owned, at December 31, 2021, compared to total non-performing assets of $8.6 million, or 0.07% of total loans and leases and other real estate owned at September 30, 2021.

Capital

Total stockholders’ equity was $2.7 billion at both December 31, 2021 and September 30, 2021.

The tier 1 leverage, common equity tier 1 and total capital ratios were 7.24%, 12.24% and 13.49%, respectively, at December 31, 2021, compared with 7.39%, 12.63% and 13.88%, respectively, at September 30, 2021.

The Company repurchased 0.77 million shares of common stock at a total cost of $21.5 million under the stock repurchase program in the fourth quarter. The average cost was $27.92 per share repurchased. Total repurchases in 2021 were $75.0 million.

As to the stock repurchase program approved for 2022, repurchases of shares of the Company’s common stock may be conducted through open-market purchases, which may include purchases under a trading plan adopted pursuant to Securities and Exchange Commission Rule 10b5-1, or through privately negotiated transactions. The timing and exact amount of share repurchases, if any, will be subject to management’s discretion and various factors, including the Company’s capital position and financial performance, as well as market conditions. The repurchase program may be suspended, terminated or modified at any time for any reason.

First Hawaiian, Inc. 

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

Conference Call Information

First Hawaiian will host a conference call to discuss the Company’s results today at 1:00 p.m. Eastern Time, 8:00 a.m. Hawaii Time. To access the call, participants should dial (844) 452-2942 (US/Canada), or (574) 990-9846 (International) ten minutes prior to the start of the call and enter the conference ID: 8790379. A live webcast of the conference call, including a slide presentation, will be available at the following link: www.fhb.com/earnings. The archive of the webcast will be available at the same location. A telephonic replay of the conference call will be available two hours after the conclusion of the call until 4:30 p.m. (Eastern Time) on January 28, 2022. Access the replay by dialing (855) 859-2056 or (404) 537-3406 and entering the conference ID: 8790379.

Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. These statements are often, but not always, made through the use of words or phrases such as “may”, “might”, “should”, “could”, “predict”, “potential”, “believe”, “expect”, “continue”, “will”, “anticipate”, “seek”, “estimate”, “intend”, “plan”, “projection”, “would”, “annualized” and “outlook”, or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management’s beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, estimates and uncertainties that are difficult to predict. Further, statements about the potential effects of the COVID-19 pandemic on our businesses and financial results and conditions may constitute forward-looking statements and are subject to the risk that the actual effects may differ, possibly materially, from what is reflected in those forward-looking statements due to factors and future developments that are uncertain, unpredictable and in many cases beyond our control, including the scope and duration of the pandemic, actions taken by governmental authorities in response to the pandemic, and the direct and indirect impact of the pandemic on our customers, third parties and us. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, there can be no assurance that actual results will not prove to be materially different from the results expressed or implied by the forward-looking statements. A number of important factors could cause actual results or performance to differ materially from the forward-looking statements, including (without limitation) the risks and uncertainties associated with the ongoing impacts of COVID-19, the domestic and global economic environment and capital market conditions and other risk factors. For a discussion of some of these risks and important factors that could affect our future results and financial condition, see our U.S. Securities and Exchange Commission (“SEC”) filings, including, but not limited to, our Annual Report on Form 10-K for the year ended December 31, 2020 and our Quarterly Report on Form 10-Q for the quarters ended March 31, 2021, June 30, 2021, and September 30, 2021.

Use of Non-GAAP Financial Measures

We present net interest income, noninterest income, noninterest expense, net income, earnings per share (basic and diluted) and the related ratios described below, on an adjusted, or “core,” basis, each a non-GAAP financial measure. These core measures exclude from the corresponding GAAP measure the impact of certain items that we do not believe are representative of our financial results. We believe that the presentation of these non-GAAP financial measures helps identify underlying trends in our business from period to period that could otherwise be distorted by the effect of certain expenses, gains and other items included in our operating results. We believe that these core measures provide useful information about our operating results and enhance the overall understanding of our past performance and future performance. Investors should consider our performance and financial condition as reported under GAAP and all other relevant information when assessing our performance or financial condition.

Core net interest margin, core efficiency ratio, core return on average total assets and core return on average total stockholders’ equity are non-GAAP financial measures. We compute our core net interest margin as the ratio of core net interest income to average earning assets. We compute our core efficiency ratio as the ratio of core noninterest expense to the sum of core net interest income and core noninterest income. We compute our core return on average total assets as the ratio of core net income to average total assets. We compute our core return on average total stockholders’ equity as the ratio of core net income to average total stockholders’ equity.

Return on average tangible stockholders’ equity, core return on average tangible stockholders’ equity, return on average tangible assets, core return on average tangible assets and tangible stockholders’ equity to tangible assets are non-GAAP financial measures. We compute our return on average tangible stockholders’ equity as the ratio of net income to average tangible stockholders’ equity, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total stockholders’ equity. We compute our core return on average tangible stockholders’ equity as the ratio of core net income to average tangible stockholders’ equity, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total stockholders’ equity. We compute our return on average tangible assets as the ratio of net income to average tangible assets, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total assets. We compute our core return on average tangible assets as the ratio of core net income to average tangible assets. We compute our tangible stockholders’ equity to tangible assets as the ratio of tangible stockholders’ equity to tangible assets, each of which we calculate by subtracting (and thereby effectively excluding) the value of our goodwill. We believe that these measurements are useful for investors, regulators, management and others to evaluate financial performance and capital adequacy relative to other financial institutions. Although these non-GAAP financial measures are frequently used by stakeholders in the evaluation of a company, they have limitations as analytical tools and should not be considered in isolation or as a substitute for analysis of our results or financial condition as reported under GAAP.

Tables 14 and 15 at the end of this document provide a reconciliation of these non-GAAP financial measures with their most directly comparable GAAP measures.

Investor Relations Contact:
Kevin Haseyama, CFA
(808) 525-6268
khaseyama@fhb.com
Media Contact:
Susan Kam
(808) 525-6254
skam@fhb.com


                                 
Financial Highlights                           Table 1
    For the Three Months Ended   For the Year Ended  
    December 31   September 30   December 31   December 31  
(dollars in thousands, except per share data)   2021   2021    2020   2021
  2020  
Operating Results:                                
Net interest income   $ 137,327   $ 132,593     $ 135,227   $ 530,559     $ 535,734  
Provision for credit losses         (4,000 )     20,000     (39,000 )     121,718  
Noninterest income     41,573     50,104       53,598     184,916       197,380  
Noninterest expense     108,749     101,036       88,127     405,479       367,672  
Net income     57,022     64,279       61,739     265,735       185,754  
Basic earnings per share     0.45     0.50       0.48     2.06       1.43  
Diluted earnings per share     0.44     0.50       0.47     2.05       1.43  
Dividends declared per share     0.26     0.26       0.26     1.04       1.04  
Dividend payout ratio     59.09 %   52.00 %     55.32 %   50.73 %     72.73 %
Supplemental Income Statement Data (non-GAAP):                                
Core net interest income   $ 137,327   $ 132,593     $ 135,227   $ 530,559     $ 535,734  
Core noninterest income     47,587     50,104       58,438     190,828       202,322  
Core noninterest expense     99,775     98,936       88,127     393,245       367,672  
Core net income     68,013     65,819       65,288     279,229       189,378  
Core basic earnings per share     0.53     0.51       0.50     2.17       1.46  
Core diluted earnings per share     0.53     0.51       0.50     2.16       1.45  
Performance Ratios(1):                                
Net interest margin     2.38 %     2.36 %     2.71 %   2.43 %      2.77 %
Core net interest margin (non-GAAP)     2.38 %     2.36 %     2.71 %   2.43 %      2.77 %
Efficiency ratio     60.50 %     55.07 %     46.59 %   56.45 %      50.10 %
Core efficiency ratio (non-GAAP)     53.71 %     53.92 %     45.43 %   54.30 %      49.77 %
Return on average total assets     0.88 %     1.02 %     1.09 %   1.09 %      0.85 %
Core return on average total assets (non-GAAP)     1.05 %     1.04 %     1.16 %   1.14 %      0.87 %
Return on average tangible assets (non-GAAP)     0.92 %     1.06 %     1.14 %   1.13 %      0.89 %
Core return on average tangible assets (non-GAAP)(2)     1.09 %     1.09 %     1.21 %   1.19 %      0.91 %
Return on average total stockholders’ equity     8.46 %     9.31 %     8.99 %   9.81 %      6.88 %
Core return on average total stockholders’ equity (non-GAAP)     10.09 %     9.54 %     9.51 %   10.31 %      7.02 %
Return on average tangible stockholders’ equity (non-GAAP)     13.47 %     14.63 %     14.14 %   15.51 %      10.91 %
Core return on average tangible stockholders’ equity (non-GAAP)(3)     16.06   14.98 %     14.95 %   16.30 %      11.12 %
Average Balances:                                
Average loans and leases   $ 12,814,316   $ 12,881,885     $ 13,366,980   $ 13,034,295     $ 13,518,308  
Average earning assets     23,100,445     22,533,174       19,977,933     21,921,149       19,376,343  
Average assets     25,650,505     25,058,085       22,468,040     24,426,258       21,869,064  
Average deposits     22,246,577     21,621,836       19,020,800     21,011,587       18,252,998  
Average stockholders’ equity     2,675,513     2,738,540       2,732,271     2,708,370       2,698,853  
Market Value Per Share:                                
Closing     27.33     29.35       23.58     27.33       23.58  
High     30.14     30.06       23.90     30.80       31.25  
Low     25.17     25.75       14.16     23.14       13.56  


                       
      As of   As of   As of  
      December 31   September 30   December 31  
(dollars in thousands, except per share data)     2021   2021   2020  
Balance Sheet Data:                      
Loans and leases     $ 12,961,999   $ 12,834,339   $ 13,279,097  
Total assets       24,992,410     25,548,322     22,662,831  
Total deposits       21,816,146     22,120,003     19,227,723  
Long-term borrowings           200,000     200,010  
Total stockholders’ equity       2,656,912     2,711,734     2,744,104  
                       
Per Share of Common Stock:                      
Book value     $ 20.84   $ 21.14   $ 21.12  
Tangible book value (non-GAAP)(4)       13.03     13.38     13.46  
                       
Asset Quality Ratios:                      
Non-accrual loans and leases / total loans and leases       0.05 %     0.07 %   0.07 %
Allowance for credit losses for loans and leases / total loans and leases       1.21 %     1.26 %   1.57 %
                       
Capital Ratios:                      
Common Equity Tier 1 Capital Ratio        12.24 %     12.63 %   12.47 %
Tier 1 Capital Ratio       12.24 %     12.63 %   12.47 %
Total Capital Ratio       13.49 %     13.88 %   13.73 %
Tier 1 Leverage Ratio       7.24 %     7.39 %   8.00 %
Total stockholders’ equity to total assets       10.63 %     10.61 %   12.11 %
Tangible stockholders’ equity to tangible assets (non-GAAP)       6.92 %     6.99 %   8.07 %
                       
Non-Financial Data:                      
Number of branches       54     54     54  
Number of ATMs       299     298     297  
Number of Full-Time Equivalent Employees       2,036     2,025     2,103  


(1)   Except for the efficiency ratio and the core efficiency ratio, amounts are annualized for the three months ended December 31, 2021, September 30, 2021 and December 31, 2020.

(2)   Core return on average tangible assets is a non-GAAP financial measure. We compute our core return on average tangible assets as the ratio of core net income to average tangible assets, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total assets. For a reconciliation to the most directly comparable GAAP financial measure for core net income, see Table 14, GAAP to Non-GAAP Reconciliation.

(3)   Core return on average tangible stockholders’ equity is a non-GAAP financial measure. We compute our core return on average tangible stockholders’ equity as the ratio of core net income to average tangible stockholders’ equity, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total stockholders’ equity. For a reconciliation to the most directly comparable GAAP financial measure for core net income, see Table 14, GAAP to Non-GAAP Reconciliation.

(4)   Tangible book value is a non-GAAP financial measure. We compute our tangible book value as the ratio of tangible stockholders’ equity to shares outstanding. Tangible stockholders’ equity is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our total stockholders’ equity. For a reconciliation to the most directly comparable GAAP financial measure for core net income, see Table 14, GAAP to Non-GAAP Reconciliation.


                               
Consolidated Statements of Income   Table 2
    For the Three Months Ended   For the Year Ended
    December 31   September 30   December 31   December 31
(dollars in thousands, except per share amounts)   2021
  2021
  2020
  2021   2020
Interest income                              
Loans and lease financing   $ 111,865     $ 110,765     $ 118,314     $ 444,488     $ 496,523  
Available-for-sale securities     28,393       25,234       22,752       101,410       81,808  
Other     1,051       1,205       615       3,413       4,428  
Total interest income     141,309       137,204       141,681       549,311       582,759  
Interest expense                              
Deposits     3,216       3,218       5,061       13,853       35,471  
Short-term and long-term borrowings     766       1,393       1,393       4,899       11,554  
Total interest expense     3,982       4,611       6,454       18,752       47,025  
Net interest income     137,327       132,593       135,227       530,559       535,734  
Provision for credit losses           (4,000 )     20,000       (39,000 )     121,718  
Net interest income after provision for credit losses     137,327       136,593       115,227       569,559       414,016  
Noninterest income                              
Service charges on deposit accounts     7,171       6,989       6,769       27,510       28,169  
Credit and debit card fees     16,266       16,017       15,583       63,580       55,451  
Other service charges and fees     9,196       10,233       8,404       38,578       33,876  
Trust and investment services income     8,895       8,625       8,733       34,719       35,652  
Bank-owned life insurance     2,851       4,841       4,159       13,185       15,754  
Investment securities (losses) gains, net                 (12 )     102       (114 )
Other     (2,806 )     3,399       9,962       7,242       28,592  
Total noninterest income     41,573       50,104       53,598       184,916       197,380  
Noninterest expense                              
Salaries and employee benefits     45,982       46,484       42,687       182,384       174,221  
Contracted services and professional fees     14,603       15,042       13,940       63,349       60,546  
Occupancy     8,074       6,790       7,355       29,348       28,821  
Equipment     6,317       6,549       5,225       24,719       20,277  
Regulatory assessment and fees     2,557       1,828       2,168       8,245       8,659  
Advertising and marketing     1,579       1,469       1,096       6,108       5,695  
Card rewards program     7,471       6,676       4,890       25,244       22,114  
Other     22,166       16,198       10,766       66,082       47,339  
Total noninterest expense     108,749       101,036       88,127       405,479       367,672  
Income before provision for income taxes     70,151       85,661       80,698       348,996       243,724  
Provision for income taxes     13,129       21,382       18,959       83,261       57,970  
Net income   $ 57,022     $ 64,279     $ 61,739     $ 265,735     $ 185,754  
Basic earnings per share   $ 0.45     $ 0.50     $ 0.48     $ 2.06     $ 1.43  
Diluted earnings per share   $ 0.44     $ 0.50     $ 0.47     $ 2.05     $ 1.43  
Basic weighted-average outstanding shares     127,893,011       128,660,038       129,912,104       128,963,131       129,890,225  
Diluted weighted-average outstanding shares     128,512,257       129,210,448       130,314,381       129,537,922       130,220,077  


                     
Consolidated Balance Sheets     Table 3
      December 31   September 30   December 31
(dollars in thousands)     2021
  2021
  2020
Assets                    
Cash and due from banks     $ 246,716     $ 268,467     $ 303,373  
Interest-bearing deposits in other banks       1,011,753       2,130,615       737,571  
Investment securities, at fair value (amortized cost: $8,560,733 as of
December 31, 2021, $7,994,266 as of September 30, 2021 and
$5,985,031 as of December 31, 2020)
      8,428,032       7,953,727       6,071,415  
Loans held for sale       538       2,052       11,579  
Loans and leases       12,961,999       12,834,339       13,279,097  
Less: allowance for credit losses       157,262       161,246       208,454  
Net loans and leases       12,804,737       12,673,093       13,070,643  
                     
Premises and equipment, net       318,448       317,272       322,401  
Other real estate owned and repossessed personal property       175              
Accrued interest receivable       63,158       64,855       69,626  
Bank-owned life insurance       471,819       468,968       466,537  
Goodwill       995,492       995,492       995,492  
Mortgage servicing rights       8,302       9,107       10,731  
Other assets       643,240       664,674       603,463  
Total assets     $ 24,992,410     $ 25,548,322     $ 22,662,831  
Liabilities and Stockholders’ Equity                    
Deposits:                    
Interest-bearing     $ 12,422,283     $ 13,246,579     $ 11,705,609  
Noninterest-bearing       9,393,863       8,873,424       7,522,114  
Total deposits       21,816,146       22,120,003       19,227,723  
Long-term borrowings             200,000       200,010  
Retirement benefits payable       134,491       144,400       143,373  
Other liabilities       384,861       372,185       347,621  
Total liabilities       22,335,498       22,836,588       19,918,727  
                     
Stockholders’ equity                    
Common stock ($0.01 par value; authorized 300,000,000 shares;
issued/outstanding: 140,581,715 / 127,502,472 shares as of
December 31, 2021, issued/outstanding: 140,563,799 / 128,255,570
shares as of September 30, 2021 and issued/outstanding:
140,191,133 / 129,912,272 shares as of December 31, 2020)
      1,406       1,406       1,402  
Additional paid-in capital       2,527,663       2,524,168       2,514,014  
Retained earnings       604,534       581,094       473,974  
Accumulated other comprehensive (loss) income, net       (121,693 )     (61,463 )     31,604  
Treasury stock (13,079,243 shares as of December 31, 2021,
12,308,229 shares as of September 30, 2021 and 10,278,861 shares
as of December 31, 2020)
      (354,998 )     (333,471 )     (276,890 )
Total stockholders’ equity       2,656,912       2,711,734       2,744,104  
Total liabilities and stockholders’ equity     $ 24,992,410     $ 25,548,322     $ 22,662,831  


                                                   
Average Balances and Interest Rates                                               Table 4
    Three Months Ended   Three Months Ended   Three Months Ended  
    December 31, 2021   September 30, 2021   December 31, 2020  
    Average   Income/   Yield/   Average   Income/   Yield/   Average   Income/   Yield/  
(dollars in millions)   Balance   Expense   Rate   Balance   Expense   Rate   Balance   Expense   Rate  
Earning Assets                                                  
Interest-Bearing Deposits in Other Banks   $ 2,074.5   $ 0.8   0.15 %   $ 2,356.4   $ 0.9   0.16 % $ 688.1   $ 0.2   0.10 %
Available-for-Sale Investment Securities                                                  
Taxable     7,515.2     25.8   1.37     6,654.6     22.9   1.37     5,632.9     22.0   1.56  
Non-Taxable     615.3     3.3   2.14     561.1     2.9   2.11     220.0     0.9   1.74  
Total Available-for-Sale Investment Securities     8,130.5     29.1   1.43     7,215.7     25.8   1.43     5,852.9     22.9   1.57  
Loans Held for Sale     1.0       1.35     2.2       2.39     16.2     0.1   2.00  
Loans and Leases(1)                                                  
Commercial and industrial     2,084.0     21.1   4.01     2,367.2     19.7   3.29     3,077.6     22.6   2.93  
Commercial real estate     3,572.9     26.0   2.89     3,447.0     25.4   2.92     3,407.2     26.2   3.06  
Construction     806.6     6.3   3.09     862.4     7.0   3.24     703.1     5.6   3.14  
Residential:                                                  
Residential mortgage     4,014.9     34.9   3.48     3,866.1     34.6   3.58     3,679.6     37.1   4.03  
Home equity line     864.4     5.5   2.52     837.7     5.5   2.62     856.8     6.1   2.81  
Consumer     1,241.3     16.3   5.22     1,260.2     16.8   5.28     1,394.5     19.0   5.43  
Lease financing     230.2     1.9   3.27     241.3     2.0   3.23     248.2     1.8   2.89  
Total Loans and Leases     12,814.3     112.0   3.48     12,881.9     111.0   3.43     13,367.0     118.4   3.53  
Other Earning Assets     80.1     0.3   1.27     77.0     0.3   1.34     53.7     0.4   3.26  
Total Earning Assets(2)     23,100.4     142.2   2.45     22,533.2     138.0   2.44     19,977.9     142.0   2.83  
Cash and Due from Banks     282.2               290.5               289.2            
Other Assets     2,267.9               2,234.4               2,200.9            
Total Assets   $ 25,650.5             $ 25,058.1             $ 22,468.0            
                                                   
Interest-Bearing Liabilities                                                  
Interest-Bearing Deposits                                                  
Savings   $ 7,086.0   $ 0.8   0.04 %   $ 6,886.0   $ 0.6   0.03 %   5,786.4   $ 0.5   0.03 %
Money Market     4,048.3     0.5   0.05     3,957.1     0.5   0.05     3,440.9     0.4   0.05  
Time     1,819.0     1.9   0.42     1,884.4     2.1   0.45     2,461.3     4.2   0.67  
Total Interest-Bearing Deposits     12,953.3     3.2   0.10     12,727.5     3.2   0.10     11,688.6     5.1   0.17  
Long-Term Borrowings     110.9     0.8   2.74     200.0     1.4   2.76     200.0     1.4   2.77  
Total Interest-Bearing Liabilities     13,064.2     4.0   0.12     12,927.5     4.6   0.14     11,888.6     6.5   0.22  
Net Interest Income         $ 138.2             $ 133.4             $ 135.5      
Interest Rate Spread               2.33 %               2.30 %             2.61 %
Net Interest Margin               2.38 %               2.36 %             2.71 %
Noninterest-Bearing Demand Deposits     9,293.3               8,894.3               7,332.2            
Other Liabilities     617.5               497.7               514.9            
Stockholders’ Equity     2,675.5               2,738.6               2,732.3            
Total Liabilities and Stockholders’ Equity   $ 25,650.5             $ 25,058.1             $ 22,468.0            


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

(2)   Interest income includes taxable-equivalent basis adjustments of $0.9 million, $0.8 million and $0.3 million for the three months ended December 31, 2021, September 30, 2021 and December 31, 2020, respectively.


                                   
Average Balances and Interest Rates                               Table 5
    Year Ended   Year Ended  
    December 31, 2021   December 31, 2020  
    Average   Income/   Yield/   Average   Income/   Yield/  
(dollars in millions)   Balance   Expense   Rate   Balance   Expense   Rate  
Earning Assets                                  
Interest-Bearing Deposits in Other Banks   $ 1,723.0   $ 2.3   0.14 %   $ 882.1   $ 2.4   0.27 %
Available-for-Sale Investment Securities                                  
Taxable     6,608.9     93.3   1.41     4,844.5     80.9   1.67  
Non-Taxable     481.9     10.2   2.12     62.0     1.1   1.77  
Total Available-for-Sale Investment Securities     7,090.8     103.5   1.46     4,906.5     82.0   1.67  
Loans Held for Sale     3.6     0.1   2.24     13.0     0.3   2.21  
Loans and Leases(1)                                  
Commercial and industrial     2,586.8     82.2   3.18     3,168.7     93.2   2.94  
Commercial real estate     3,456.7     101.6   2.94     3,419.1     116.9   3.42  
Construction     804.5     25.4   3.16     615.7     21.3   3.46  
Residential:                                  
Residential mortgage     3,836.6     138.3   3.60     3,698.7     148.4   4.01  
Home equity line     834.3     22.2   2.66     875.1     27.1   3.10  
Consumer     1,275.5     67.8   5.31     1,501.6     82.9   5.52  
Lease financing     239.9     7.6   3.14     239.4     6.9   2.90  
Total Loans and Leases     13,034.3     445.1   3.42     13,518.3     496.7   3.67  
Other Earning Assets     69.4     1.1   1.54     56.4     2.0   3.66  
Total Earning Assets(2)     21,921.1     552.1   2.52     19,376.3     583.4   3.01  
Cash and Due from Banks     289.3               304.9            
Other Assets     2,215.9               2,187.9            
Total Assets   $ 24,426.3             $ 21,869.1            
                                   
Interest-Bearing Liabilities                                  
Interest-Bearing Deposits                                  
Savings   $ 6,581.1   $ 2.5   0.04 %   $ 5,538.1   $ 5.2   0.09 %
Money Market     3,831.4     2.1   0.05     3,266.6     6.6   0.20  
Time     2,005.0     9.3   0.47     2,839.8     23.7   0.83  
Total Interest-Bearing Deposits     12,417.5     13.9   0.11     11,644.5     35.5   0.30  
Federal Funds Purchased               1.4       0.43  
Short-Term Borrowings               208.2     6.0   2.88  
Long-Term Borrowings     177.5     4.9   2.76     200.0     5.5   2.77  
Total Interest-Bearing Liabilities     12,595.0     18.8   0.15     12,054.1     47.0   0.39  
Net Interest Income         $ 533.3             $ 536.4      
Interest Rate Spread               2.37 %               2.62 %
Net Interest Margin               2.43 %               2.77 %
Noninterest-Bearing Demand Deposits     8,594.1               6,608.5            
Other Liabilities     528.8               507.6            
Stockholders’ Equity     2,708.4               2,698.9            
Total Liabilities and Stockholders’ Equity   $ 24,426.3             $ 21,869.1            


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

(2)   Interest income includes taxable-equivalent basis adjustments of $2.8 million and $0.7 million for the years ended December 31, 2021 and 2020, respectively.


                   
Analysis of Change in Net Interest Income                 Table 6
    Three Months Ended December 31, 2021
    Compared to September 30, 2021
(dollars in millions)   Volume   Rate   Total
Change in Interest Income:                  
Interest-Bearing Deposits in Other Banks   $ (0.1 )   $     $ (0.1 )
Available-for-Sale Investment Securities                  
Taxable     2.9             2.9  
Non-Taxable     0.3       0.1       0.4  
Total Available-for-Sale Investment Securities     3.2       0.1       3.3  
Loans and Leases                  
Commercial and industrial     (2.5 )     3.9       1.4  
Commercial real estate     0.9       (0.3 )     0.6  
Construction     (0.4 )     (0.3 )     (0.7 )
Residential:                  
Residential mortgage     1.3       (1.0 )     0.3  
Home equity line     0.2       (0.2 )      
Consumer     (0.3 )     (0.2 )     (0.5 )
Lease financing     (0.1 )           (0.1 )
Total Loans and Leases     (0.9 )     1.9       1.0  
Total Change in Interest Income     2.2       2.0       4.2  
                   
Change in Interest Expense:                  
Interest-Bearing Deposits                  
Savings           0.2       0.2  
Time     (0.1 )     (0.1 )     (0.2 )
Total Interest-Bearing Deposits     (0.1 )     0.1        
Long-Term Borrowings     (0.6 )           (0.6 )
Total Change in Interest Expense     (0.7 )     0.1       (0.6 )
Change in Net Interest Income   $ 2.9     $ 1.9     $ 4.8  


                   
Analysis of Change in Net Interest Income                 Table 7
    Three Months Ended December 31, 2021
    Compared to December 31, 2020
(dollars in millions)   Volume   Rate   Total
Change in Interest Income:                  
Interest-Bearing Deposits in Other Banks   $ 0.5     $ 0.1     $ 0.6  
Available-for-Sale Investment Securities                  
Taxable     6.7       (2.9 )     3.8  
Non-Taxable     2.1       0.3       2.4  
Total Available-for-Sale Investment Securities     8.8       (2.6 )     6.2  
Loans Held for Sale     (0.1 )           (0.1 )
Loans and Leases                  
Commercial and industrial     (8.5 )     7.0       (1.5 )
Commercial real estate     1.3       (1.5 )     (0.2 )
Construction     0.8       (0.1 )     0.7  
Residential:                  
Residential mortgage     3.2       (5.4 )     (2.2 )
Home equity line           (0.6 )     (0.6 )
Consumer     (2.0 )     (0.7 )     (2.7 )
Lease financing     (0.1 )     0.2       0.1  
Total Loans and Leases     (5.3 )     (1.1 )     (6.4 )
Other Earning Assets     0.2       (0.3 )     (0.1 )
Total Change in Interest Income     4.1       (3.9 )     0.2  
                   
Change in Interest Expense:                  
Interest-Bearing Deposits                  
Savings     0.1       0.2       0.3  
Money Market     0.1             0.1  
Time     (0.9 )     (1.4 )     (2.3 )
Total Interest-Bearing Deposits     (0.7 )     (1.2 )     (1.9 )
Long-Term Borrowings     (0.6 )           (0.6 )
Total Change in Interest Expense     (1.3 )     (1.2 )     (2.5 )
Change in Net Interest Income   $ 5.4     $ (2.7 )   $ 2.7  


                   
Analysis of Change in Net Interest Income                 Table 8
    Year Ended December 31, 2021
    Compared to December 31, 2020
(dollars in millions)   Volume   Rate   Total
Change in Interest Income:                  
Interest-Bearing Deposits in Other Banks   $ 1.5     $ (1.6 )   $ (0.1 )
Available-for-Sale Investment Securities                  
Taxable     26.3       (13.9 )     12.4  
Non-Taxable     8.8       0.3       9.1  
Total Available-for-Sale Investment Securities     35.1       (13.6 )     21.5  
Loans Held for Sale     (0.2 )           (0.2 )
Loans and Leases                  
Commercial and industrial     (18.1 )     7.1       (11.0 )
Commercial real estate     1.3       (16.6 )     (15.3 )
Construction     6.1       (2.0 )     4.1  
Residential:                  
Residential mortgage     5.4       (15.5 )     (10.1 )
Home equity line     (1.2 )     (3.7 )     (4.9 )
Consumer     (12.1 )     (3.0 )     (15.1 )
Lease financing     0.1       0.6       0.7  
Total Loans and Leases     (18.5 )     (33.1 )     (51.6 )
Other Earning Assets     0.4       (1.3 )     (0.9 )
Total Change in Interest Income     18.3       (49.6 )     (31.3 )
                   
Change in Interest Expense:                  
Interest-Bearing Deposits                  
Savings     0.7       (3.4 )     (2.7 )
Money Market     1.0       (5.5 )     (4.5 )
Time     (5.8 )     (8.6 )     (14.4 )
Total Interest-Bearing Deposits     (4.1 )     (17.5 )     (21.6 )
Short-Term Borrowings     (3.0 )     (3.0 )     (6.0 )
Long-Term Borrowings     (0.6 )           (0.6 )
Total Change in Interest Expense     (7.7 )     (20.5 )     (28.2 )
Change in Net Interest Income   $ 26.0     $ (29.1 )   $ (3.1 )


                     
Loans and Leases                   Table 9
      December 31   September 30   December 31
(dollars in thousands)     2021   2021   2020
Commercial and industrial:                    
Commercial and industrial excluding Paycheck Protection
Program loans
    $ 1,870,657   $ 1,692,315   $ 2,218,266
Paycheck Protection Program loans       216,442     503,069     801,241
Total commercial and industrial       2,087,099     2,195,384     3,019,507
Commercial real estate       3,639,623     3,569,768     3,392,676
Construction       813,969     826,078     735,819
Residential:                    
Residential mortgage       4,083,367     3,914,632     3,690,218
Home equity line       876,608     852,074     841,624
Total residential       4,959,975     4,766,706     4,531,842
Consumer       1,229,939     1,238,714     1,353,842
Lease financing       231,394     237,689     245,411
Total loans and leases     $ 12,961,999   $ 12,834,339   $ 13,279,097


                     
Deposits                   Table 10
      December 31   September 30   December 31
(dollars in thousands)     2021   2021   2020
Demand     $ 9,393,863   $ 8,873,424   $ 7,522,114
Savings       6,612,775     7,347,079     6,020,075
Money Market       4,033,070     4,019,250     3,337,236
Time       1,776,438     1,880,250     2,348,298
Total Deposits     $ 21,816,146   $ 22,120,003   $ 19,227,723


                     
Non-Performing Assets and Accruing Loans and Leases Past Due 90 Days or More                   Table 11
      December 31   September 30   December 31
(dollars in thousands)     2021    2021   2020
Non-Performing Assets                    
Non-Accrual Loans and Leases                    
Commercial Loans:                    
Commercial and industrial     $ 718   $ 746   $ 518
Commercial real estate       727     745     80
Construction               2,043
Total Commercial Loans       1,445     1,491     2,641
Residential Loans:                    
Residential mortgage       5,637     7,137     6,441
Total Residential Loans       5,637     7,137     6,441
Total Non-Accrual Loans and Leases       7,082     8,628     9,082
Other Real Estate Owned       175        
Total Non-Performing Assets     $ 7,257   $ 8,628   $ 9,082
                     
Accruing Loans and Leases Past Due 90 Days or More                    
Commercial Loans:                    
Commercial and industrial     $ 740   $ 439   $ 2,108
Commercial real estate               882
Construction               93
Total Commercial Loans       740     439     3,083
Residential Loans:                    
Residential mortgage       987     100    
Home equity line       3,681     3,871     4,818
Total Residential Loans       4,668     3,971     4,818
Consumer       1,800     1,376     3,266
Total Accruing Loans and Leases Past Due 90 Days or More     $ 7,208   $ 5,786   $ 11,167
                     
Restructured Loans on Accrual Status and Not Past Due 90 Days or More     $ 34,893   $ 36,234   $ 16,684
Total Loans and Leases     $ 12,961,999   $ 12,834,339   $ 13,279,097


                                 
Allowance for Credit Losses                           Table 12
    For the Three Months Ended   For the Year Ended  
    December 31   September 30   December 31   December 31   December 31  
(dollars in thousands)   2021
  2021
  2020
   2021
  2020
 
Balance at Beginning of Period   $ 161,246     $ 169,148     $ 195,876     $ 208,454     $ 130,530    
Adjustment to Adopt ASC Topic 326                             770    
After Adoption of ASC Topic 326     161,246       169,148       195,876       208,454       131,300    
Loans and Leases Charged-Off                                
Commercial Loans:                                
Commercial and industrial     (4,432 )     (224 )     (799 )     (5,949 )     (15,572 )  
Commercial real estate                 (30 )     (66 )     (2,753 )  
Construction                             (379 )  
Total Commercial Loans     (4,432 )     (224 )     (829 )     (6,015 )     (18,704 )  
Residential Loans:                                
Residential mortgage     (534 )                 (632 )     (14 )  
Home equity line     (107 )     (235 )     (46 )     (342 )     (54 )  
Total Residential Loans     (641 )     (235 )     (46 )     (974 )     (68 )  
Consumer     (3,250 )     (2,926 )     (7,049 )     (16,634 )     (28,791 )  
Total Loans and Leases Charged-Off     (8,323 )     (3,385 )     (7,924 )     (23,623 )     (47,563 )  
Recoveries on Loans and Leases Previously Charged-Off                                
Commercial Loans:                                
Commercial and industrial     244       121       2,986       867       5,005    
Commercial real estate     9       15       615       39       615    
Construction     100             30       266       200    
Total Commercial Loans     353       136       3,631       1,172       5,820    
Residential Loans:                                
Residential mortgage     15       215       37       261       216    
Home equity line     28       27       21       117       167    
Total Residential Loans     43       242       58       378       383    
Consumer     1,743       2,405       2,812       9,600       10,499    
Total Recoveries on Loans and Leases Previously Charged-Off     2,139       2,783       6,501       11,150       16,702    
Net Loans and Leases Charged-Off     (6,184 )     (602 )     (1,423 )     (12,473 )     (30,861 )  
Provision for Credit Losses - Loans and Leases     2,200       (7,300 )     14,001       (38,719 )     108,015    
Balance at End of Period   $ 157,262     $ 161,246     $ 208,454     $ 157,262     $ 208,454    
Average Loans and Leases Outstanding   $ 12,814,316     $ 12,881,885     $ 13,366,980     $ 13,034,295     $ 13,518,308    
Ratio of Net Loans and Leases Charged-Off to Average Loans and Leases Outstanding(1)     0.19 %     0.02 %     0.04 %     0.10     0.23 %  
Ratio of Allowance for Credit Losses for Loans and Leases to Loans and Leases Outstanding     1.21     1.26 %     1.57 %     1.21 %      1.57 %  
Ratio of Allowance for Credit Losses for Loans and Leases to Non-accrual Loans and Leases     22.21x     18.69x     22.95x     22.21x     22.95x  


(1)   Annualized for the three months ended December 31, 2021, September 30, 2021 and December 31, 2020.


                                                       
Loans and Leases by Year of Origination and Credit Quality Indicator     Table 13
                                              Revolving      
                                              Loans      
                                              Converted      
    Term Loans   Revolving   to Term      
    Amortized Cost Basis by Origination Year   Loans   Loans      
                                        Amortized   Amortized      
(dollars in thousands)   2021   2020   2019   2018   2017   Prior   Cost Basis   Cost Basis   Total
Commercial Lending                                                      
Commercial and Industrial                                                      
Risk rating:                                                      
Pass   $ 623,098   $ 129,665   $ 223,388   $ 88,409   $ 29,380   $ 168,591   $ 644,947   $ 40,193   $ 1,947,671
Special Mention     397     4,382     4,213     12,552     974     5,313     4,804     986     33,621
Substandard     354     1,380     1,951     1,285     60     3,551     17,893     1,043     27,517
Other (1)     13,277     7,070     7,741     4,453     1,995     370     43,384         78,290
Total Commercial and Industrial     637,126     142,497     237,293     106,699     32,409     177,825     711,028     42,222     2,087,099
                                                       
Commercial Real Estate                                                      
Risk rating:                                                      
Pass     693,370     338,140     533,887     487,739     415,186     940,732     78,479     14,891     3,502,424
Special Mention             48,499     7,470     25,513     30,255     7,600         119,337
Substandard                 1,776     164     15,303     459         17,702
Other (1)                         160             160
Total Commercial
Real Estate
    693,370     338,140     582,386     496,985     440,863     986,450     86,538     14,891     3,639,623
                                                       
Construction                                                      
Risk rating:                                                      
Pass     154,558     107,767     210,314     155,311     62,770     48,021     22,859         761,600
Special Mention             244     707         356             1,307
Substandard                 363         839             1,202
Other (1)     26,835     8,875     4,317     4,308     2,684     2,048     793         49,860
Total Construction     181,393     116,642     214,875     160,689     65,454     51,264     23,652         813,969
                                                       
Lease Financing                                                      
Risk rating:                                                      
Pass     33,980     60,650     48,236     9,449     15,009     57,130             224,454
Special Mention     501     2,702     1,506     311     153                 5,173
Substandard         270     140     16     871     470             1,767
Total Lease Financing     34,481     63,622     49,882     9,776     16,033     57,600             231,394
                                                       
Total Commercial
Lending
  $ 1,546,370   $ 660,901   $ 1,084,436   $ 774,149   $ 554,759   $ 1,273,139   $ 821,218   $ 57,113   $ 6,772,085


                                                       
                                              Revolving      
                                              Loans      
                                              Converted      
    Term Loans   Revolving   to Term      
    Amortized Cost Basis by Origination Year   Loans   Loans      
(continued)                                       Amortized   Amortized      
(dollars in thousands)   2021   2020   2019   2018   2017   Prior   Cost Basis   Cost Basis   Total
Residential Lending                                                      
Residential Mortgage                                                      
FICO:                                                      
740 and greater   $ 1,101,958   $ 635,061   $ 286,993   $ 198,622   $ 251,906   $ 829,175   $   $   $ 3,303,715
680 - 739     140,997     81,590     45,163     27,315     32,855     125,906             453,826
620 - 679     15,781     11,943     5,268     10,149     9,069     37,404             89,614
550 - 619     1,735     873     698     533     2,033     7,475             13,347
Less than 550                 345     2,603     2,838             5,786
No Score (3)     18,882     7,938     15,051     18,107     17,333     42,185             119,496
Other (2)     25,625     16,263     10,242     11,297     16,242     17,152     44     718     97,583
Total Residential Mortgage     1,304,978     753,668     363,415     266,368     332,041     1,062,135     44     718     4,083,367
                                                       
Home Equity Line                                                      
FICO:                                                      
740 and greater                             671,566     1,873     673,439
680 - 739                             141,889     3,968     145,857
620 - 679                             37,815     2,500     40,315
550 - 619                             9,090     948     10,038
Less than 550                             2,574     68     2,642
No Score (3)                             4,317         4,317
Total Home Equity Line                             867,251     9,357     876,608
Total Residential Lending     1,304,978     753,668     363,415     266,368     332,041     1,062,135     867,295     10,075     4,959,975
                                                       
Consumer Lending                                                      
FICO: