SEC Filing - First Hawaiian, Inc.

View:

Download DOC

Download PDF

Download XLS

Download XBRL

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): April 28, 2023

FIRST HAWAIIAN, INC.

(Exact Name of Registrant as Specified in Its Charter)


Delaware
(State or Other Jurisdiction of Incorporation)


001-14585		99-0156159
(Commission File Number)		(IRS Employer Identification No.)


999 Bishop St., 29th Floor
Honolulu, Hawaii		96813
(Address of Principal Executive Offices)		(Zip Code)

(808) 525-7000

(Registrant’s Telephone Number, Including Area Code)

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class:	Trading Symbol(s)	Name of each exchange on which registered:
Common Stock, par value $0.01 per share	FHB	NASDAQ Global Select Market

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

Emerging growth company ☐

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

Item 2.02 Results of Operations and Financial Condition.

On April 28, 2023, First Hawaiian, Inc. (together with its consolidated subsidiary, “First Hawaiian”) reported its earnings for the quarter ended March 31, 2023. A copy of First Hawaiian’s press release containing this information is being furnished as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated herein by reference.

All information provided in this Current Report on Form 8-K, including Exhibit 99.1, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities under that Section, and shall not be deemed to be incorporated by reference into any filing of First Hawaiian under the Securities Act of 1933, as amended, or the Exchange Act except as expressly set forth by specific reference in such a filing.

Item 9.01 Financial Statements and Exhibits.

(d)Exhibits


Exhibit No.		Description

99.1		Press release of First Hawaiian, Inc. dated April 28, 2023 containing financial information for its quarter ended March 31, 2023.

104		Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Pril
	FIRST HAWAIIAN, INC.

Date: April 28, 2023	By:	/s/ Robert S. Harrison
		Robert S. Harrison
		Chairman of the Board, President and Chief Executive Officer
		(Principal Executive Officer)

EXHIBIT 99.1

For Immediate Release

First Hawaiian, Inc. Reports First Quarter 2023 Financial Results and Declares Dividend

HONOLULU, Hawaii April 28, 2023--(Globe Newswire)--First Hawaiian, Inc. (NASDAQ:FHB), (“First Hawaiian” or the “Company”) today reported financial results for its quarter ended March 31, 2023.

“Our first quarter results reflect the strength of our balance sheet, the value of our customer relationships and our commitment to the communities we serve,” said Bob Harrison, Chairman, President and CEO. “Our financial results were solid, we grew capital and our credit quality metrics remained excellent. We remain well positioned to serve our customers and the community.”

On April 26, 2023, the Company’s Board of Directors declared a quarterly cash dividend of $0.26 per share. The dividend will be payable on June 2, 2023, to stockholders of record at the close of business on May 22, 2023.

First Quarter 2023 Highlights:

●

Net income of $66.8 million, or $0.52 per diluted share

●

Total loans and leases increased $129.3 million versus prior quarter

●

Total deposits decreased $407.5 million versus prior quarter

●

Net interest margin decreased 4 basis points to 3.11%

●

Recorded a $8.8 million provision for credit losses

●

Board of Directors declared a quarterly dividend of $0.26 per share

Balance Sheet

Total assets were $24.9 billion as of March 31, 2023, compared to $24.6 billion as of December 31, 2022.

Gross loans and leases were $14.2 billion as of March 31, 2023, an increase of $129.3 million, or 0.9%, from $14.1 billion as of December 31, 2022.

Total deposits were $21.3 billion as of March 31, 2023, a decrease of $407.5 million, or 1.9%, from $21.7 billion as of December 31, 2022.

Net Interest Income

Net interest income for the first quarter of 2023 was $167.2 million, a decrease of $4.5 million, or 2.6%, compared to $171.8 million for the prior quarter.

The net interest margin was 3.11% in the first quarter of 2023, a decrease of 4 basis points compared to 3.15% in the prior quarter.

Provision Expense

During the quarter ended March 31, 2023, we recorded a $8.8 million provision for credit losses. In the quarter ended December 31, 2022, we recorded a $3.0 million provision for credit losses.

Noninterest Income

Noninterest income was $49.0 million in the first quarter of 2023, an increase of $0.9 million compared to noninterest income of $48.2 million in the prior quarter.

Noninterest Expense

Noninterest expense was $118.6 million in the first quarter of 2023, an increase of $4.6 million compared to noninterest expense of $113.9 million in the prior quarter.

The efficiency ratio was 54.5% and 51.5% for the quarters ended March 31, 2023 and December 31, 2022, respectively.

Taxes

The effective tax rate was 24.8% and 22.8% for the quarters ended March 31, 2023 and December 31, 2022, respectively.

Asset Quality

The allowance for credit losses was $147.1 million, or 1.03% of total loans and leases, as of March 31, 2023, compared to $143.9 million, or 1.02% of total loans and leases, as of December 31, 2022. The reserve for unfunded commitments was $36.2 million as of March 31, 2023, compared to $33.8 million as of December 31, 2022. Net charge-offs were $3.2 million, or 0.09% of average loans and leases on an annualized basis for the quarter ended March 31, 2023, compared to net charge-offs of $3.5 million, or 0.10% of average loans and leases on an annualized basis, for the quarter ended December 31, 2022. Total non-performing assets were $13.8 million, or 0.10% of total loans and leases and other real estate owned, on March 31, 2023, compared to total non-performing assets of $12.0 million, or 0.09% of total loans and leases and other real estate owned, on December 31, 2022.

Capital

Total stockholders’ equity was $2.3 billion on March 31, 2023 and December 31, 2022.

The tier 1 leverage, common equity tier 1 and total capital ratios were 8.26%, 11.97% and 13.09%, respectively, on March 31, 2023, compared with 8.11%, 11.82% and 12.92%, respectively, on December 31, 2022.

The Company did not repurchase any shares in the first quarter.

First Hawaiian, Inc.

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

Conference Call Information

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

To access the call by phone, please register via the following link:

https://register.vevent.com/register/BI2a46e3679b7649d98326df98e6359e6f, and you will be provided with dial in details. To avoid delays, we encourage participants to dial into the conference call fifteen minutes ahead of the scheduled start time.

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

Forward-Looking Statements

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

Use of Non-GAAP Financial Measures

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

Table 12 at the end of this document provides a reconciliation of these non-GAAP financial measures with their most directly comparable GAAP measures.


Investor Relations Contact:	Media Contact:
Kevin Haseyama, CFA	Lindsay Chambers
(808) 525-6268	(808) 525-6254
khaseyama@fhb.com	lchambers@fhb.com


Financial Highlights	Table 1
	For the Three Months Ended
	March 31,			December 31,			March 31,
(dollars in thousands, except per share data)	2023			2022			2022
Operating Results:
Net interest income	$	167,247		$	171,794		$	133,872
Provision for credit losses		8,800			2,956			(5,747)
Noninterest income		49,023			48,151			41,380
Noninterest expense		118,567			113,922			104,042
Net income		66,818			79,588			57,719
Basic earnings per share		0.52			0.62			0.45
Diluted earnings per share		0.52			0.62			0.45
Dividends declared per share		0.26			0.26			0.26
Dividend payout ratio		50.00	%		41.94	%		57.78	%
Performance Ratios⁽¹⁾:
Net interest margin		3.11	%		3.15	%		2.42	%
Efficiency ratio		54.46	%		51.47	%		59.04	%
Return on average total assets		1.10	%		1.28	%		0.93	%
Return on average tangible assets (non-GAAP)⁽²⁾		1.15	%		1.34	%		0.97	%
Return on average total stockholders' equity		11.78	%		14.27	%		9.19	%
Return on average tangible stockholders' equity (non-GAAP)⁽²⁾		20.78	%		25.93	%		15.08	%
Average Balances:
Average loans and leases	$	14,079,337		$	13,876,136		$	12,819,612
Average earning assets		21,873,259			21,856,135			22,463,209
Average assets		24,548,124			24,575,648			25,080,453
Average deposits		21,468,624			21,725,177			21,960,819
Average stockholders' equity		2,299,422			2,213,030			2,547,865
Market Value Per Share:
Closing		20.63			26.04			27.89
High		28.28			27.16			31.16
Low		19.68			24.06			26.93


	As of			As of			As of
	March 31,			December 31,			March 31,
(dollars in thousands, except per share data)	2023			2022			2022
Balance Sheet Data:
Loans and leases	$	14,221,272		$	14,092,012		$	12,891,743
Total assets		24,884,207			24,577,223			25,042,720
Total deposits		21,281,500			21,689,029			22,270,430
Short-term borrowings		250,000			75,000			—
Long-term borrowings		500,000			—			—
Total stockholders' equity		2,329,012			2,269,005			2,285,149

Per Share of Common Stock:
Book value	$	18.26		$	17.82		$	17.90
Tangible book value (non-GAAP)⁽²⁾		10.45			10.00			10.10

Asset Quality Ratios:
Non-accrual loans and leases / total loans and leases		0.10	%		0.08	%		0.07	%
Allowance for credit losses for loans and leases / total loans and leases		1.03	%		1.02	%		1.17	%

Capital Ratios:
Common Equity Tier 1 Capital Ratio		11.97	%		11.82	%		12.27	%
Tier 1 Capital Ratio		11.97	%		11.82	%		12.27	%
Total Capital Ratio		13.09	%		12.92	%		13.48	%
Tier 1 Leverage Ratio		8.26	%		8.11	%		7.50	%
Total stockholders' equity to total assets		9.36	%		9.23	%		9.13	%
Tangible stockholders' equity to tangible assets (non-GAAP)⁽²⁾		5.58	%		5.40	%		5.36	%

Non-Financial Data:
Number of branches		51			51			51
Number of ATMs		296			294			298
Number of Full-Time Equivalent Employees		2,100			2,063			2,022

(1)	Except for the efficiency ratio, amounts are annualized for the three months ended March 31, 2023, December 31, 2022 and March 31, 2022.

(2)

Return on average tangible assets, return on average tangible stockholders’ equity, tangible book value per share and tangible stockholders’ equity to tangible assets are non-GAAP financial measures. We compute our return on average tangible assets as the ratio of net income to average tangible assets, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total assets. We compute our return on average tangible stockholders’ equity as the ratio of net income to average tangible stockholders’ equity, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total stockholders’ equity. We compute our tangible book value per share as the ratio of tangible stockholders’ equity to outstanding shares. Tangible stockholders’ equity is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our total stockholders’ equity. We compute our tangible stockholders’ equity to tangible assets as the ratio of tangible stockholders’ equity to tangible assets, each of which we calculate by subtracting (and thereby effectively excluding) the value of our goodwill. For a reconciliation to the most directly comparable GAAP financial measure, see Table 12, GAAP to Non-GAAP Reconciliation.


Consolidated Statements of Income	Table 2
	For the Three Months Ended
	March 31,		December 31,		March 31,
(dollars in thousands, except per share amounts)	2023		2022		2022
Interest income
Loans and lease financing	$	172,339	$	159,526	$	103,732
Available-for-sale investment securities		18,688		18,714		32,107
Held-to-maturity investment securities		18,957		19,137		—
Other		3,561		3,088		782
Total interest income		213,545		200,465		136,621
Interest expense
Deposits		43,284		28,202		2,749
Short-term and long-term borrowings		2,563		469		—
Other		451		—		—
Total interest expense		46,298		28,671		2,749
Net interest income		167,247		171,794		133,872
Provision for credit losses		8,800		2,956		(5,747)
Net interest income after provision for credit losses		158,447		168,838		139,619
Noninterest income
Service charges on deposit accounts		7,231		7,376		7,501
Credit and debit card fees		16,298		16,376		14,850
Other service charges and fees		9,162		9,185		9,654
Trust and investment services income		9,614		9,023		8,883
Bank-owned life insurance		5,120		2,865		(417)
Other		1,598		3,326		909
Total noninterest income		49,023		48,151		41,380
Noninterest expense
Salaries and employee benefits		56,032		49,629		48,226
Contracted services and professional fees		16,313		17,638		17,147
Occupancy		7,782		8,175		7,410
Equipment		9,736		9,984		5,977
Regulatory assessment and fees		3,836		2,591		2,224
Advertising and marketing		1,994		2,072		2,028
Card rewards program		8,085		8,681		6,883
Other		14,789		15,152		14,147
Total noninterest expense		118,567		113,922		104,042
Income before provision for income taxes		88,903		103,067		76,957
Provision for income taxes		22,085		23,479		19,238
Net income	$	66,818	$	79,588	$	57,719
Basic earnings per share	$	0.52	$	0.62	$	0.45
Diluted earnings per share	$	0.52	$	0.62	$	0.45
Basic weighted-average outstanding shares		127,453,820		127,356,795		127,556,242
Diluted weighted-average outstanding shares		128,033,812		127,894,773		128,121,126


Consolidated Balance Sheets	Table 3
	March 31,		December 31,		March 31,
(dollars in thousands)	2023		2022		2022
Assets
Cash and due from banks	$	253,705	$	297,502	$	274,022
Interest-bearing deposits in other banks		611,887		229,122		1,352,138
Investment securities:
Available-for-sale, at fair value (amortized cost: $3,427,708 as of March 31, 2023, $3,549,599 as of December 31, 2022 and $8,733,170 as of March 31, 2022)		3,054,280		3,151,133		8,062,384
Held-to-maturity, at amortized cost (fair value: $3,824,478 as of March 31, 2023, $3,814,822 as of December 31, 2022 and nil as of March 31, 2022)		4,261,361		4,320,639		—
Loans and leases		14,221,272		14,092,012		12,891,743
Less: allowance for credit losses		147,122		143,900		150,280
Net loans and leases		14,074,150		13,948,112		12,741,463

Premises and equipment, net		278,121		280,355		315,766
Other real estate owned and repossessed personal property		91		91		—
Accrued interest receivable		79,200		78,194		61,561
Bank-owned life insurance		473,255		473,067		471,401
Goodwill		995,492		995,492		995,492
Mortgage servicing rights		6,299		6,562		7,650
Other assets		796,366		796,954		760,843
Total assets	$	24,884,207	$	24,577,223	$	25,042,720
Liabilities and Stockholders' Equity
Deposits:
Interest-bearing	$	12,579,155	$	12,824,383	$	12,504,821
Noninterest-bearing		8,702,345		8,864,646		9,765,609
Total deposits		21,281,500		21,689,029		22,270,430
Short-term borrowings		250,000		75,000		—
Long-term borrowings		500,000		—		—
Retirement benefits payable		101,622		102,577		134,323
Other liabilities		422,073		441,612		352,818
Total liabilities		22,555,195		22,308,218		22,757,571

Stockholders' equity
Common stock ($0.01 par value; authorized 300,000,000 shares; issued/outstanding: 141,291,086 / 127,573,680 shares as of March 31, 2023, issued/outstanding: 140,963,918 / 127,363,327 shares as of December 31, 2022 and issued/outstanding: 140,875,595 / 127,686,307 shares as of March 31, 2022)		1,413		1,410		1,409
Additional paid-in capital		2,540,653		2,538,336		2,530,795
Retained earnings		769,791		736,544		628,642
Accumulated other comprehensive loss, net		(611,679)		(639,254)		(517,502)
Treasury stock (13,717,406 shares as of March 31, 2023, 13,600,591 shares as of December 31, 2022 and 13,189,288 shares as of March 31, 2022)		(371,166)		(368,031)		(358,195)
Total stockholders' equity		2,329,012		2,269,005		2,285,149
Total liabilities and stockholders' equity	$	24,884,207	$	24,577,223	$	25,042,720


Average Balances and Interest Rates																	Table 4
	Three Months Ended						Three Months Ended						Three Months Ended
	March 31, 2023						December 31, 2022						March 31, 2022
	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	$	299.6	$	3.4	4.60	%	$	321.3	$	2.9	3.64	%	$	1,138.3	$	0.6	0.20	%
Available-for-Sale Investment Securities
Taxable		3,081.4		18.4	2.39			3,180.8		18.3	2.30			7,800.3		29.2	1.50
Non-Taxable		31.1		0.4	5.55			37.9		0.5	5.42			636.7		3.6	2.32
Held-to-Maturity Investment Securities
Taxable		3,683.8		15.7	1.70			3,754.9		15.8	1.69			—		—	—
Non-Taxable		612.2		4.1	2.74			613.4		4.2	2.69			—		—	—
Total Investment Securities		7,408.5		38.6	2.09			7,587.0		38.8	2.04			8,437.0		32.8	1.56
Loans Held for Sale		0.1		—	5.53			0.1		—	6.50			1.2		—	2.02
Loans and Leases⁽¹⁾
Commercial and industrial		2,192.9		32.4	5.98			2,126.3		28.1	5.24			1,973.1		14.6	3.01
Commercial real estate		4,105.7		58.3	5.76			4,116.8		53.9	5.19			3,632.2		25.8	2.88
Construction		873.9		14.7	6.83			804.4		11.8	5.83			766.9		5.7	3.03
Residential:
Residential mortgage		4,307.0		38.4	3.57			4,280.6		38.1	3.56			4,111.0		34.8	3.38
Home equity line		1,074.9		8.7	3.27			1,029.7		8.1	3.10			891.6		5.5	2.48
Consumer		1,213.5		17.2	5.75			1,220.9		17.1	5.55			1,218.6		15.6	5.19
Lease financing		311.4		3.1	4.10			297.4		2.9	3.92			226.2		1.9	3.42
Total Loans and Leases		14,079.3		172.8	4.96			13,876.1		160.0	4.58			12,819.6		103.9	3.27
Other Earning Assets		85.8		0.2	0.76			71.6		0.2	0.80			67.1		0.2	1.31
Total Earning Assets⁽²⁾		21,873.3		215.0	3.97			21,856.1		201.9	3.67			22,463.2		137.5	2.47
Cash and Due from Banks		286.1						286.4						292.1
Other Assets		2,388.7						2,433.1						2,325.2
Total Assets	$	24,548.1					$	24,575.6					$	25,080.5

Interest-Bearing Liabilities
Interest-Bearing Deposits
Savings	$	6,354.3	$	13.9	0.89	%	$	6,455.5	$	10.3	0.63	%		6,668.4	$	0.5	0.03	%
Money Market		3,853.5		14.3	1.50			4,012.9		9.8	0.97			4,048.9		0.5	0.05
Time		2,515.6		15.1	2.44			2,163.2		8.1	1.48			1,748.5		1.7	0.39
Total Interest-Bearing Deposits		12,723.4		43.3	1.38			12,631.6		28.2	0.89			12,465.8		2.7	0.09
Federal Funds Purchased		67.1		0.7	4.43			45.5		0.5	4.09			—		—	—
Other Short-Term Borrowings		52.8		0.7	5.02			—		—	—			—		—	—
Long-Term Borrowings		105.5		1.2	4.52			—		—	—			—		—	—
Other Interest-Bearing Liabilities		42.8		0.4	4.27			—		—	—			—		—	—
Total Interest-Bearing Liabilities		12,991.6		46.3	1.45			12,677.1		28.7	0.90			12,465.8		2.7	0.09
Net Interest Income			$	168.7					$	173.2					$	134.8
Interest Rate Spread					2.52	%					2.77	%					2.38	%
Net Interest Margin					3.11	%					3.15	%					2.42	%
Noninterest-Bearing Demand Deposits		8,745.2						9,093.6						9,495.0
Other Liabilities		511.9						591.9						571.8
Stockholders' Equity		2,299.4						2,213.0						2,547.9
Total Liabilities and Stockholders' Equity	$	24,548.1					$	24,575.6					$	25,080.5

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

(2)	Interest income includes taxable-equivalent basis adjustments of $1.4 million, $1.4 million and $1.0 million for the three months ended March 31, 2023, December 31, 2022 and March 31, 2022, respectively.


Analysis of Change in Net Interest Income						Table 5
	Three Months Ended March 31, 2023
	Compared to December 31, 2022
(dollars in millions)	Volume		Rate		Total
Change in Interest Income:
Interest-Bearing Deposits in Other Banks	$	(0.2)	$	0.7	$	0.5
Available-for-Sale Investment Securities
Taxable		(0.6)		0.7		0.1
Non-Taxable		(0.1)		—		(0.1)
Held-to-Maturity Investment Securities
Taxable		(0.2)		0.1		(0.1)
Non-Taxable		(0.1)		—		(0.1)
Total Investment Securities		(1.0)		0.8		(0.2)
Loans and Leases
Commercial and industrial		0.8		3.5		4.3
Commercial real estate		(0.2)		4.6		4.4
Construction		1.0		1.9		2.9
Residential:
Residential mortgage		0.2		0.1		0.3
Home equity line		0.3		0.3		0.6
Consumer		(0.2)		0.3		0.1
Lease financing		0.1		0.1		0.2
Total Loans and Leases		2.0		10.8		12.8
Total Change in Interest Income		0.8		12.3		13.1

Change in Interest Expense:
Interest-Bearing Deposits
Savings		(0.2)		3.8		3.6
Money Market		(0.4)		4.9		4.5
Time		1.4		5.6		7.0
Total Interest-Bearing Deposits		0.8		14.3		15.1
Federal Funds Purchased		0.2		—		0.2
Other Short-Term Borrowings		0.7		—		0.7
Long-Term Borrowings		1.2		—		1.2
Other Interest-Bearing Liabilities		0.4		—		0.4
Total Change in Interest Expense		3.3		14.3		17.6
Change in Net Interest Income	$	(2.5)	$	(2.0)	$	(4.5)


Analysis of Change in Net Interest Income						Table 6
	Three Months Ended March 31, 2023
	Compared to March 31, 2022
(dollars in millions)	Volume		Rate		Total
Change in Interest Income:
Interest-Bearing Deposits in Other Banks	$	(0.7)	$	3.5	$	2.8
Available-for-Sale Investment Securities
Taxable		(23.0)		12.2		(10.8)
Non-Taxable		(5.5)		2.3		(3.2)
Held-to-Maturity Investment Securities
Taxable		15.7		—		15.7
Non-Taxable		4.1		—		4.1
Total Investment Securities		(8.7)		14.5		5.8
Loans and Leases
Commercial and industrial		1.8		16.0		17.8
Commercial real estate		3.7		28.8		32.5
Construction		0.9		8.1		9.0
Residential:
Residential mortgage		1.7		1.9		3.6
Home equity line		1.3		1.9		3.2
Consumer		(0.1)		1.7		1.6
Lease financing		0.8		0.4		1.2
Total Loans and Leases		10.1		58.8		68.9
Other Earning Assets		0.1		(0.1)		—
Total Change in Interest Income		0.8		76.7		77.5

Change in Interest Expense:
Interest-Bearing Deposits
Savings		—		13.4		13.4
Money Market		—		13.8		13.8
Time		1.0		12.4		13.4
Total Interest-Bearing Deposits		1.0		39.6		40.6
Federal Funds Purchased		0.7		—		0.7
Other Short-Term Borrowings		0.7		—		0.7
Long-Term Borrowings		1.2		—		1.2
Other Interest-Bearing Liabilities		0.4		—		0.4
Total Change in Interest Expense		4.0		39.6		43.6
Change in Net Interest Income	$	(3.2)	$	37.1	$	33.9


Loans and Leases						Table 7
	March 31,		December 31,		March 31,
(dollars in thousands)	2023		2022		2022
Commercial and industrial:
Commercial and industrial excluding Paycheck Protection Program loans	$	2,254,506	$	2,217,604	$	1,817,346
Paycheck Protection Program loans		13,826		18,293		106,188
Total commercial and industrial		2,268,332		2,235,897		1,923,534
Commercial real estate		4,106,200		4,132,309		3,759,980
Construction		913,959		844,643		708,300
Residential:
Residential mortgage		4,318,742		4,302,788		4,153,824
Home equity line		1,095,365		1,055,351		918,101
Total residential		5,414,107		5,358,139		5,071,925
Consumer		1,191,552		1,222,934		1,204,834
Lease financing		327,122		298,090		223,170
Total loans and leases	$	14,221,272	$	14,092,012	$	12,891,743


Deposits						Table 8
	March 31,		December 31,		March 31,
(dollars in thousands)	2023		2022		2022
Demand	$	8,702,345	$	8,864,646	$	9,765,609
Savings		6,173,398		6,382,910		6,812,758
Money Market		3,818,355		3,965,423		3,990,225
Time		2,587,402		2,476,050		1,701,838
Total Deposits	$	21,281,500	$	21,689,029	$	22,270,430


Non-Performing Assets and Accruing Loans and Leases Past Due 90 Days or More						Table 9
	March 31,		December 31,		March 31,
(dollars in thousands)	2023		2022		2022
Non-Performing Assets
Non-Accrual Loans and Leases
Commercial Loans:
Commercial and industrial	$	1,158	$	1,215	$	707
Commercial real estate		727		727		727
Lease financing		—		—		75
Total Commercial Loans		1,885		1,942		1,509
Residential Loans:
Residential mortgage		6,896		6,166		7,092
Home equity line		4,903		3,797		—
Total Residential Loans		11,799		9,963		7,092
Total Non-Accrual Loans and Leases		13,684		11,905		8,601
Other Real Estate Owned		91		91		—
Total Non-Performing Assets	$	13,775	$	11,996	$	8,601

Accruing Loans and Leases Past Due 90 Days or More
Commercial Loans:
Commercial and industrial	$	461	$	291	$	591
Commercial real estate		1,346		—		—
Construction		102		—		—
Total Commercial Loans		1,909		291		591
Residential Loans:
Residential mortgage		58		58		13
Home equity line		—		—		2,252
Total Residential Loans		58		58		2,265
Consumer		2,502		2,885		1,588
Total Accruing Loans and Leases Past Due 90 Days or More	$	4,469	$	3,234	$	4,444

Total Loans and Leases	$	14,221,272	$	14,092,012	$	12,891,743


Allowance for Credit Losses and Reserve for Unfunded Commitments	Table 10
	For the Three Months Ended
	March 31,			December 31,			March 31,
(dollars in thousands)	2023			2022			2022
Balance at Beginning of Period	$	177,735		$	178,304		$	187,584
Loans and Leases Charged-Off
Commercial and industrial		(791)			(735)			(706)
Residential Loans:
Residential mortgage		(122)			(102)			—
Home equity line		(135)			(12)			(43)
Total Residential Loans		(257)			(114)			(43)
Consumer		(4,782)			(5,094)			(4,109)
Total Loans and Leases Charged-Off		(5,830)			(5,943)			(4,858)
Recoveries on Loans and Leases Previously Charged-Off
Commercial Loans:
Commercial and industrial		246			303			53
Commercial real estate		—			—			14
Total Commercial Loans		246			303			67
Residential Loans:
Residential mortgage		27			173			16
Home equity line		177			138			28
Total Residential Loans		204			311			44
Consumer		2,166			1,804			2,148
Total Recoveries on Loans and Leases Previously Charged-Off		2,616			2,418			2,259
Net Loans and Leases Charged-Off		(3,214)			(3,525)			(2,599)
Provision for Credit Losses		8,800			2,956			(5,747)
Balance at End of Period	$	183,321		$	177,735		$	179,238
Components:
Allowance for Credit Losses	$	147,122		$	143,900		$	150,280
Reserve for Unfunded Commitments		36,199			33,835			28,958
Total Allowance for Credit Losses and Reserve for Unfunded Commitments	$	183,321		$	177,735		$	179,238
Average Loans and Leases Outstanding	$	14,079,337		$	13,876,136		$	12,819,612
Ratio of Net Loans and Leases Charged-Off to Average Loans and Leases Outstanding⁽¹⁾		0.09	%		0.10	%		0.08	%
Ratio of Allowance for Credit Losses for Loans and Leases to Loans and Leases Outstanding		1.03	%		1.02	%		1.17	%
Ratio of Allowance for Credit Losses for Loans and Leases to Non-accrual Loans and Leases		10.75x			12.09x			17.47x

(1)	Annualized for the three months ended March 31, 2023, December 31, 2022 and March 31, 2022.

Loans and Leases by Year of Origination and Credit Quality Indicator

Table 11

Revolving

Loans

Converted

Term Loans

Revolving

to Term

Amortized Cost Basis by Origination Year

Loans

Amortized

(dollars in thousands)

2023

2022

2021

2020

2019

Prior

Cost Basis

Total

Commercial Lending

Commercial and Industrial

Risk rating:

Pass

66,587

338,534

412,459

48,560

167,698

178,991

921,651

13,566

2,148,046

Special Mention

152

16,591

202

994

2,526

1,548

2,557

283

24,853

Substandard

—

594

274

1,058

958

1,422

11,043

15,390

Other ⁽¹⁾

5,223

14,426

6,965

3,780

3,312

2,287

44,050

—

80,043

Total Commercial and Industrial

71,962

370,145

419,900

54,392

174,494

184,248

979,301

13,890

2,268,332

Current period gross charge-offs

—

711

—

791

Commercial Real Estate

Risk rating:

Pass

105,554

880,292

661,523

321,162

521,596

1,533,711

56,034

—

4,079,872

Special Mention

—

163

—

551

7,031

11,490

659

—

19,894

Substandard

—

172

—

5,808

305

—

6,285

Other ⁽¹⁾

—

149

—

149

Total Commercial Real Estate

105,554

880,455

661,523

321,885

528,627

1,551,158

56,998

—

4,106,200

Current period gross charge-offs

—

Construction

Risk rating:

Pass

15,219

152,263

333,608

89,515

103,855

141,243

20,349

—

856,052

Special Mention

—

213

—

213

Substandard

—

486

—

486

Other ⁽¹⁾

817

29,615

16,206

2,991

2,160

4,478

941

—

57,208

Total Construction

16,036

181,878

349,814

92,506

106,228

146,207

21,290

—

913,959

Current period gross charge-offs

—

Lease Financing

Risk rating:

Pass

51,664

99,102

22,653

42,081

37,333

72,254

—

325,087

Special Mention

—

388

—

470

Substandard

—

184

1,372

—

1,565

Total Lease Financing

51,664

99,102

23,041

42,347

37,342

73,626

—

327,122

Current period gross charge-offs

—

Total Commercial Lending

245,216

1,531,580

1,454,278

511,130

846,691

1,955,239

1,057,589

13,890

7,615,613

Current period gross charge-offs

—

711

—

791


															Revolving
															Loans
															Converted
	Term Loans												Revolving		to Term
	Amortized Cost Basis by Origination Year												Loans		Loans
(continued)													Amortized		Amortized
(dollars in thousands)	2023		2022		2021		2020		2019		Prior		Cost Basis		Cost Basis		Total
Residential Lending
Residential Mortgage
FICO:
740 and greater	$	61,686	$	550,291	$	1,044,555	$	546,035	$	235,535	$	1,057,166	$	—	$	—	$	3,495,268
680 - 739		11,937		75,088		118,790		86,202		35,379		145,363		—		—		472,759
620 - 679		2,776		11,464		17,424		9,946		9,243		36,678		—		—		87,531
550 - 619		—		2,613		2,865		2,447		825		12,487		—		—		21,237
Less than 550		—		530		2,445		1,498		275		7,276		—		—		12,024
No Score ⁽³⁾		4,909		19,766		14,573		6,773		10,494		61,168		—		—		117,683
Other ⁽²⁾		4,425		18,205		18,013		13,511		9,064		35,164		13,306		552		112,240
Total Residential Mortgage		85,733		677,957		1,218,665		666,412		300,815		1,355,302		13,306		552		4,318,742
Current period gross charge-offs		—		—		—		—		—		122		—		—		122

Home Equity Line
FICO:
740 and greater		—		—		—		—		—		—		824,038		1,304		825,342
680 - 739		—		—		—		—		—		—		190,187		2,440		192,627
620 - 679		—		—		—		—		—		—		52,239		1,728		53,967
550 - 619		—		—		—		—		—		—		12,734		1,566		14,300
Less than 550		—		—		—		—		—		—		5,370		661		6,031
No Score ⁽³⁾		—		—		—		—		—		—		3,098		—		3,098
Total Home Equity Line		—		—		—		—		—		—		1,087,666		7,699		1,095,365
Current period gross charge-offs		—		—		—		—		—		—		116		19		135

Total Residential Lending	$	85,733	$	677,957	$	1,218,665	$	666,412	$	300,815	$	1,355,302	$	1,100,972	$	8,251	$	5,414,107
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	122	$	116	$	19	$	257

Consumer Lending
FICO:
740 and greater		40,337		158,451		96,174		46,618		37,211		24,636		114,058		161		517,646
680 - 739		23,366		97,741		56,306		29,741		24,169		15,970		70,708		441		318,442
620 - 679		7,022		44,839		26,924		12,728		14,484		11,731		33,772		860		152,360
550 - 619		750		10,172		9,698		6,475		7,647		7,519		11,937		855		55,053
Less than 550		122		4,446		5,400		4,078		4,951		4,518		4,329		526		28,370
No Score ⁽³⁾		866		2,376		8		—		16		36		36,396		167		39,865
Other ⁽²⁾		76		1,588		4,060		348		1,136		—		72,608		—		79,816
Total Consumer Lending	$	72,539	$	319,613	$	198,570	$	99,988	$	89,614	$	64,410	$	343,808	$	3,010	$	1,191,552
Current period gross charge-offs	$	—	$	635	$	681	$	312	$	614	$	867	$	1,471	$	202	$	4,782

Total Loans and Leases	$	403,488	$	2,529,150	$	2,871,513	$	1,277,530	$	1,237,120	$	3,374,951	$	2,502,369	$	25,151	$	14,221,272
Current period gross charge-offs	$	—	$	695	$	681	$	312	$	634	$	1,700	$	1,587	$	221	$	5,830

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

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

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


GAAP to Non-GAAP Reconciliation	Table 12
	For the Three Months Ended
	March 31,			December 31,			March 31,
(dollars in thousands, except per share amounts)	2023			2022			2022
Income Statement Data:
Net income	$	66,818		$	79,588		$	57,719

Average total stockholders' equity	$	2,299,422		$	2,213,030		$	2,547,865
Less: average goodwill		995,492			995,492			995,492
Average tangible stockholders' equity	$	1,303,930		$	1,217,538		$	1,552,373

Average total assets	$	24,548,124		$	24,575,648		$	25,080,453
Less: average goodwill		995,492			995,492			995,492
Average tangible assets	$	23,552,632		$	23,580,156		$	24,084,961

Return on average total stockholders' equity⁽¹⁾		11.78	%		14.27	%		9.19	%
Return on average tangible stockholders' equity (non-GAAP)⁽¹⁾		20.78	%		25.93	%		15.08	%

Return on average total assets⁽¹⁾		1.10	%		1.28	%		0.93	%
Return on average tangible assets (non-GAAP)⁽¹⁾		1.15	%		1.34	%		0.97	%



	As of			As of			As of
	March 31,			December 31,			March 31,
(dollars in thousands, except per share amounts)	2023			2022			2022
Balance Sheet Data:
Total stockholders' equity	$	2,329,012		$	2,269,005		$	2,285,149
Less: goodwill		995,492			995,492			995,492
Tangible stockholders' equity	$	1,333,520		$	1,273,513		$	1,289,657

Total assets	$	24,884,207		$	24,577,223		$	25,042,720
Less: goodwill		995,492			995,492			995,492
Tangible assets	$	23,888,715		$	23,581,731		$	24,047,228

Shares outstanding		127,573,680			127,363,327			127,686,307

Total stockholders' equity to total assets		9.36	%		9.23	%		9.13	%
Tangible stockholders' equity to tangible assets (non-GAAP)		5.58	%		5.40	%		5.36	%

Book value per share	$	18.26		$	17.82		$	17.90
Tangible book value per share (non-GAAP)	$	10.45		$	10.00		$	10.10

(1)	Annualized for the three months ended March 31, 2023, December 31, 2022 and March 31, 2022.