Join today and have your say! It’s FREE!

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.
Please Try Again
{{ error }}
By providing my email, I consent to receiving investment related electronic messages from Stockhouse.

or

Sign In

Please Try Again
{{ error }}
Password Hint : {{passwordHint}}
Forgot Password?

or

Please Try Again {{ error }}

Send my password

SUCCESS
An email was sent with password retrieval instructions. Please go to the link in the email message to retrieve your password.

Become a member today, It's free!

We will not release or resell your information to third parties without your permission.

Premier Financial Corp. Announces Full Year 2022 Results and Dividend Increase

PFC

Fourth Quarter 2022 Highlights

  • Loan growth of $239.0 million (up 15.1% annualized) including $131.5 million for commercial loans excluding PPP (up 12.8% annualized)
  • Customer deposits growth of $100.4 million (up 6.0% annualized) including $43.0 million of non-interest-bearing (up 9.4% annualized)
  • Net interest income (tax equivalent) of $62.8 million or $62.2 million excluding PPP and acquisition marks accretion, up 9.3% and 17.0%, respectively, from 2021 fourth quarter
  • Completed an insurance agency acquisition
  • Declared dividend of $0.31 per share, up 3.3% from prior year comparable period

Full Year 2022 Highlights

  • Loan growth of $1.1 billion (up 20.5%) including $694.7 million for commercial loans excluding PPP (up 19.6%)
  • Customer deposits growth of $481.0 million (up 7.7%) including $144.7 million of non-interest-bearing (up 8.4%)
  • Net interest income (tax equivalent) of $243.7 million or $237.3 million excluding PPP and acquisition marks accretion, up 6.7% and 14.1%, respectively, from 2021
  • Asset quality improved with non-performing loans down 30% and classified loans down 37% from 2021

Premier Financial Corp. (Nasdaq: PFC) (“Premier” or the “Company”) announced today 2022 fourth quarter and full year results. Net income for the fourth quarter of 2022 was $25.3 million, or $0.71 per diluted common share, compared to $25.3 million, or $0.69 per diluted common share, for the fourth quarter of 2021. Net income for 2022 was $102.2 million, or $2.85 per diluted common share, compared to $126.1 million, or $3.39 per diluted common share, for 2021.

“We continued to have stronger than anticipated loan and deposit growth as we closed the fourth quarter,” said Gary Small, President and CEO of Premier. “Full year loan growth exceeded 20% with core customer deposits up 7.7%. For the full year, tax equivalent net interest income grew $29 million, or 14% on a core basis excluding PPP and purchase accounting marks. The growth reflects the strength of our client base and the markets in which we operate. We did experience a step up in deposit betas during the quarter although this is in line with our overall historical range for the deposit book of business. As noted last quarter, we are utilizing non-core funding enabling us to thoughtfully manage core deposit costs across the organization. Diligent funding cost management will be a key for the organization and the industry in 2023.”

Quarterly results

Strong loan and deposit growth

Gross loans including those held for sale increased $239.0 million (up 15.1% annualized) on a linked quarter basis. Loan growth occurred in each category, including $131.5 million from commercial loans excluding PPP (up 12.8% annualized), $100.9 million from residential loans including held for sale (up 23.4% annualized) and $5.9 million from consumer/home equity loans (up 4.8% annualized). PPP loans decreased $38 thousand and were only $1.1 million as of December 31, 2022.

Customer deposits increased $100.4 million (up 6.0% annualized) on a linked quarter basis. Deposit growth occurred in each customer category, including $43.0 million from non-interest bearing deposits (up 9.4% annualized) and $57.4 million from interest-bearing deposits (up 4.7% annualized). Brokered deposits also added $73.8 million.

Net interest income and margin

Net interest income of $62.8 million on a tax equivalent (“TE”) basis in the fourth quarter of 2022 was down 1.1% from $63.5 million in the third quarter of 2022 but up 9.3% from $57.5 million in the fourth quarter of 2021. TE net interest margin of 3.28% in the fourth quarter of 2022 decreased 12 basis points from 3.40% in the third quarter of 2022 and 13 basis points from 3.41% in the fourth quarter of 2021. Results for all periods include the impact of PPP as well as acquisition marks and related accretion. Fourth quarter 2022 includes $329 thousand of accretion in interest income, $225 thousand of accretion in interest expense and $6 thousand of interest income on average balances of $1.2 million for PPP. Excluding the impact of acquisition marks accretion and PPP loans, core net interest income was $62.2 million, down 1.0% from $62.9 million in the third quarter of 2022 but up 17.0% from $53.2 million in the fourth quarter of 2021. Additionally, core net interest margin was 3.25% for the fourth quarter of 2022, down 11 basis points from 3.36% for the third quarter of 2022 but up 4 basis points from 3.21% for the fourth quarter of 2021. These results are positively impacted by the combination of loan growth excluding PPP as discussed above and higher loan yields excluding PPP and acquisition marks accretion, which were 4.51% for the fourth quarter of 2022 compared to 4.24% in the third quarter of 2022 and 3.86% in the fourth quarter of 2021. The fourth quarter increase of 27 basis points represents a beta of 18% compared to the change in the quarterly average effective Federal Funds rate that increased 147 basis points to 3.65% for the fourth quarter of 2022 as reported by the Federal Reserve Economic Data. The cost of funds in the fourth quarter of 2022 was 1.00%, up 45 basis points from the third quarter of 2022 and up 79 basis points from the fourth quarter of 2021. The year-over-year increase is largely due to utilization of higher cost FHLB borrowings in support of loan growth in excess of deposit growth. The linked quarter increase is due to higher rates on FHLB borrowings, utilization of brokered deposits and higher average deposit costs. Excluding brokered deposits and acquisition marks accretion, average deposit costs increased 33 basis points to 0.72% for the fourth quarter of 2022, which represents a beta of 22% compared to the change in the quarterly average effective Federal Funds rate.

Non-interest income

Service fees in the fourth quarter of 2022 were $6.6 million, a 1.3% increase from $6.5 million in the third quarter of 2022 and a 4.4% increase from $6.4 million in the fourth quarter of 2021, primarily due to fluctuations in consumer activity for interchange and ATM/NSF charges. However, total non-interest income in the fourth quarter of 2022 of $14.2 million was down 14.8% from $16.7 million in the third quarter of 2022 and down 19.1% from $17.6 million in the fourth quarter of 2021 primarily due to fluctuations in mortgage banking and gains/losses on securities. Mortgage banking income decreased by $4.3 million on a linked quarter basis due to a $4.6 million decrease in gains, primarily from higher hedge costs, partially offset by a $0.3 million higher MSR valuation gain. Mortgage banking income for the fourth quarter decreased $3.4 million year-over-year due to a $4.1 million decrease in gains primarily from compressed margins and lower saleable mix offset partly by a $0.5 million benefit from lower MSR amortization and a $0.2 million higher MSR valuation gain. Securities gains were $1.2 million in the fourth quarter of 2022 primarily from $1.3 million of gains on the sale of $8.7 million of equity securities, which were partially offset by $0.1 million of decreased valuations on remaining equity securities. This compares to $43 thousand of losses from decreased valuations on equity securities in the third quarter of 2022 and $1.1 million of gains from increased valuations on equity securities in the fourth quarter of 2021. An additional $9.6 million of available-for-sale securities were sold for a gain of $1 thousand during the fourth quarter of 2022. The combined $18.3 million of proceeds from security sales will benefit net interest income beginning in the first quarter of 2023. BOLI income of $1.0 million in the fourth quarter 2022 decreased from $2.1 million in the fourth quarter 2021 due to $1.1 million of claim gains in 2021 compared to none in 2022.

“We are pleased to note we originated over $1 billion in residential mortgages for the year in a very difficult environment,” Small added. “We continue to adjust our product offering to optimize the saleable mix and improve our gain on sale margins and remain very committed to the business over the long-term.”

Non-interest expenses

Non-interest expenses in the fourth quarter of 2022 were $43.0 million, a 4.7% increase from $41.1 million in the third quarter of 2022 and a 3.7% increase from $41.5 million in the fourth quarter of 2021. Compensation and benefits were $25.0 million in the fourth quarter of 2022, compared to $24.5 million in the third quarter of 2022 and $24.2 million in the fourth quarter of 2021. The linked quarter increase was primarily due to lower deferred costs related to decreased loan production. The year-over-year increase was primarily due to costs related to higher staffing levels for our growth initiatives and higher base compensation including mid-year adjustments. Data processing and FDIC premiums increased $0.8 million and $0.3 million on a linked quarter basis, respectively, and $0.4 million and $0.5 million on a year-over-year basis, respectively, due to our growth initiatives. All other non-interest expenses increased a net $0.4 million on a linked quarter basis and decreased a net $0.1 million on a year-over-year basis. The efficiency ratio for the fourth quarter 2022 of 56.76% worsened from 51.26% in the third quarter of 2022 and from 56.14% in the fourth quarter of 2021, primarily due to higher expenses.

Credit quality

Non-performing assets totaled $34.4 million, or 0.4% of assets, at December 31, 2022, an increase from $33.6 million at September 30, 2022, but a decrease from $48.2 million at December 31, 2021. Loan delinquencies increased to $18.3 million, or 0.3% of loans, at December 31, 2022, from $13.2 million at September 30, 2022, and from $12.3 million at December 31, 2021. Classified loans totaled $43.8 million, or 0.6% of loans, as of December 31, 2022, a decrease from $45.0 million at September 30, 2022, and from $69.5 million at December 31, 2021.

The 2022 fourth quarter results include net loan charge-offs of $830 thousand and a total provision expense of $2.8 million, compared with net loan charge-offs of $9.6 million and a total provision expense of $2.0 million for the same period in 2021. The current year provision is primarily due to higher non-PPP loan growth in 2022 compared to 2021. The allowance for credit losses as a percentage of total loans was 1.13% at December 31, 2022, compared with 1.14% at September 30, 2022, and 1.26% at December 31, 2021. The allowance for credit losses as a percentage of total loans excluding PPP and including unaccreted acquisition marks was 1.17% at December 31, 2022, compared with 1.19% at September 30, 2022, and 1.37% at December 31, 2021. The continued economic improvement following the 2020 pandemic-related downturn has resulted in a year-over-year decrease in the allowance percentages.

“We are pleased with our improved asset quality this year, including a 28.5% decrease in non-performing assets to 0.41% of total assets and a 37.0% decrease in classified loans to 0.61% of loans,” said Paul Nungester, CFO of Premier. “Net charge-offs for 2022 were only 0.015% of average loans excluding $5.3 million for the student loan servicer credit that was reserved for in 2021.”

Annual results

For the year ended December 31, 2022, net income totaled $102.2 million, or $2.85 per diluted common share, compared to $126.1 million, or $3.39 per diluted common share for the year ended December 31, 2021. The year-over-year comparison is primarily impacted by fluctuations in the provision for credit losses, which was an expense of $14.3 million or $0.32 per diluted share in 2022 compared to a benefit of $7.1 million or $0.15 per share in 2021. The current year’s provision expense is primarily due to loan growth, whereas the prior year’s provision benefit was primarily due to the improving economic environment following the COVID-19 pandemic-induced economic recession and reserve increase in 2020.

TE net interest income of $243.7 million in 2022 was up 6.7% from $228.4 million in 2021. TE net interest margin of 3.37% in 2022 decreased by two basis points from 3.39% in 2021. Results for each period include the impact of PPP as well as acquisition marks and related accretion. 2022 includes $1.7 million of accretion in interest income, $0.9 million of accretion in interest expense and $3.8 million of interest income on average balances of $12.1 million for PPP. Excluding the impact of acquisition marks accretion and PPP loans, core net interest income was $237.3 million, up 14.1% from $208.0 million in 2021. Additionally, core net interest margin was 3.28% for 2022, up four basis points from 3.24% for 2021. These improved results are primarily due to loan growth excluding PPP partially offset by lower PPP income and accretion from acquisition marks. Cost of funds in 2022 was 0.51%, up 26 basis points from 2021. The year-over-year increase is primarily due to an increased utilization of higher cost FHLB borrowings in support of loan growth in excess of deposit growth and higher average deposit costs.

Service fees in 2022 were $25.9 million, a 7.0% increase from $24.2 million in 2021, primarily due to increased consumer activity for interchange and ATM/NSF charges. However, total non-interest income in 2022 of $62.2 million was down 21.6% from $79.3 million in 2021 due to fluctuations in mortgage banking, gains/losses on securities, BOLI and other income. Mortgage banking income decreased $12.1 million from 2021 due to a $10.7 million decrease in gains primarily from compressed margins and lower saleable mix and a $3.8 million decrease from lower MSR valuation gains, partially offset by a $2.5 million benefit from lower MSR amortization. Securities losses were $0.6 million in 2022 primarily from $1.3 million of gains on the sale of $8.7 million of equity securities that partially offset $1.9 million of decreased valuations on equity securities compared to $4.2 million of net gains in 2021 comprised of $2.2 million from available-for-sale security sales gains and $2.0 million of gains from increased valuations on equity securities. BOLI income for 2022 decreased $1.2 million from 2021, primarily due to $1.1 million of claim gains in 2021. Other income for 2022 decreased $1.1 million from 2021, primarily due to a $1.3 million non-recurring settlement payment in 2021.

Non-interest expenses in 2022 were $164.5 million, a 4.6% increase from $157.3 million in 2021, primarily due to fluctuations in compensation and benefit expenses. Compensation and benefits were $97.4 million in 2022 compared to $90.6 million in 2021. The year-over-year increase was primarily due to costs related to higher staffing levels for our growth initiatives and higher base compensation including mid-year adjustments. All other non-interest expenses increased a net $0.4 million on a year-over-year basis. The efficiency ratio for 2022 was 53.68% compared to 51.83% in 2021, partly due to higher expenses but also due to lower non-interest income discussed above.

Total assets at $8.46 billion

Total assets at December 31, 2022, were $8.46 billion, compared to $8.24 billion at September 30, 2022, and $7.48 billion at December 31, 2021. Gross loans receivable were $6.46 billion at December 31, 2022, compared to $6.21 billion at September 30, 2022, and $5.30 billion at December 31, 2021. At December 31, 2022, gross loans receivable increased $1.16 billion from a year ago, despite a $57.8 million decrease in PPP loans. Excluding PPP, loans grew $1.22 billion organically, or 23.3% from a year ago. Commercial loans excluding PPP increased by $694.7 million from December 31, 2021, to 2022, or 19.6%. Securities at December 31, 2022, were $1.05 billion, compared to $1.08 billion at September 30, 2022, and $1.22 billion at December 31, 2021. Also, at December 31, 2022, goodwill and other intangible assets totaled $337.1 million compared to $337.9 million at September 30, 2022, and $342.1 million at December 31, 2021, with the decreases attributable to intangibles amortization.

Total non-brokered deposits at December 31, 2022, were $6.76 billion, compared with $6.66 billion at September 30, 2022, and $6.28 billion at December 31, 2021. At December 31, 2022, customer deposits grew $100.4 million organically, or 6.0% annualized from the prior quarter and $481.0 million or 7.7% from December 31, 2021. Brokered deposits were $143.7 million at December 31, 2022, compared to $69.9 million at September 30, 2022 and none at December 31, 2021.

Total stockholders’ equity was $0.89 billion at December 31, 2022, compared to $0.86 billion at September 30, 2022, and $1.02 billion at December 31, 2021. The quarterly increase in stockholders’ equity was primarily due to net earnings after dividends. The year-over-year decrease was primarily due to a decrease in accumulated other comprehensive income (“AOCI”), which was primarily related to a $138 million negative valuation adjustment on the available-for-sale securities portfolio. At December 31, 2022, 1,200,025 common shares remained available for repurchase under the Company’s existing repurchase program.

Insurance Agency Acquisition

On December 30, 2022, Premier, through its wholly owned subsidiary First Insurance Group of the Midwest, Inc. (“FIG”), completed the acquisition of Benham Insurance Associates, Inc. (“BIA”), a property and casualty insurance agency. Located in Holland, Ohio, with annual revenues of approximately $0.2 million, BIA will be added to Premier’s FIG platform.

Dividend to be paid February 17

The Board of Directors declared a quarterly cash dividend of $0.31 per common share payable February 17, 2023, to shareholders of record at the close of business on February 10, 2023. The dividend represents an annual dividend of 4.5 percent based on the Premier common stock closing price on January 23, 2022. Premier has approximately 35,602,000 common shares outstanding.

Conference call

Premier will host a conference call at 11:00 a.m. ET on Wednesday, January 25, 2023, to discuss the earnings results and business trends. The conference call may be accessed by calling 1-844-200-6205 and using access code 105871. Internet access to the call is also available (in listen-only mode) at the following URL: https://events.q4inc.com/attendee/815175646. The webcast replay of the conference call will be available at www.PremierFinCorp.com for one year.

About Premier Financial Corp.

Premier Financial Corp. (Nasdaq: PFC), headquartered in Defiance, Ohio, is the holding company for Premier Bank and First Insurance Group. Premier Bank, headquartered in Youngstown, Ohio, operates 74 branches and 12 loan offices in Ohio, Michigan, Indiana, Pennsylvania and West Virginia (West Virginia office operates as Home Savings Bank) and serves clients through a team of wealth professionals dedicated to each community banking branch. First Insurance Group is a full-service insurance agency with ten offices in Ohio. For more information, visit the company’s website at PremierFinCorp.com.

Financial Statements and Highlights Follow-

Safe Harbor Statement

This document may contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. These statements may include, but are not limited to, statements regarding projections, forecasts, goals and plans of Premier Financial Corp. and its management, future movements of interests, loan or deposit production levels, future credit quality ratios, future strength in the market area, and growth projections. These statements do not describe historical or current facts and may be identified by words such as “intend,” “intent,” “believe,” “expect,” “estimate,” “target,” “plan,” “anticipate,” or similar words or phrases, or future or conditional verbs such as “will,” “would,” “should,” “could,” “might,” “may,” “can,” or similar verbs. There can be no assurances that the forward-looking statements included in this presentation will prove to be accurate. In light of the significant uncertainties in the forward-looking statements, the inclusion of such information should not be regarded as a representation by Premier or any other persons, that our objectives and plans will be achieved. Forward-looking statements involve numerous risks and uncertainties, any one or more of which could affect Premier’s business and financial results in future periods and could cause actual results to differ materially from plans and projections. These risks and uncertainties include, but not limited to: impacts from the novel coronavirus (COVID-19) pandemic on the economy, financial markets, our customers, and our business and results of operation; changes in interest rates; disruptions in the mortgage market; risks and uncertainties inherent in general and local banking, insurance and mortgage conditions; political uncertainty; uncertainty in U.S. fiscal or monetary policy; uncertainty concerning or disruptions relating to tensions surrounding the current socioeconomic landscape; competitive factors specific to markets in which Premier operates; increasing competition for financial products from other financial institutions and nonbank financial technology companies; legislative or regulatory rulemaking or actions; capital market conditions; security breaches or unauthorized disclosure of confidential customer or Company information; interruptions in the effective operation of information and transaction processing systems of Premier or Premier’s vendors and service providers; failures or delays in integrating or adopting new technology; the impact of the cessation of LIBOR interest rates and implementation of a replacement rate; and other risks and uncertainties detailed from time to time in our Securities and Exchange Commission (SEC) filings, including our Annual Report on Form 10-K for the year ended December 31, 2021 and any further amendments thereto. All forward-looking statements made in this presentation are based on information presently available to the management of Premier and speak only as of the date on which they are made. We assume no obligation to update any forward-looking statements, whether as a result of new information, future developments or otherwise, except as may be required by law. As required by U.S. GAAP, Premier will evaluate the impact of subsequent events through the issuance date of its December 31, 2022, consolidated financial statements as part of its Annual Report on Form 10-K to be filed with the SEC. Accordingly, subsequent events could occur that may cause Premier to update its critical accounting estimates and to revise its financial information from that which is contained in this news release.

Non-GAAP Reporting Measures

We believe that net income, as defined by U.S. GAAP, is the most appropriate earnings measurement. However, we consider core net interest income to be a useful supplemental measure of our operating performance. We define core net interest income as net interest income on a tax-equivalent basis excluding income from PPP loans and purchase accounting marks accretion. We believe that this metric is a useful supplemental measure of operating performance because investors and equity analysts may use this measure to compare the operating performance of the Company between periods or as compared to other financial institutions or other companies on a consistent basis without having to account for income from PPP loans and purchase accounting marks accretion. Our supplemental reporting measures and similarly entitled financial measures are widely used by investors, equity and debt analysts and ratings agencies in the valuation, comparison, rating and investment recommendations of companies. Our management uses these financial measures to facilitate internal and external comparisons to historical operating results and in making operating decisions. Additionally, they are utilized by the Board of Directors to evaluate management. The supplemental reporting measures do not represent net income or cash flow provided from operating activities as determined in accordance with U.S. GAAP and should not be considered as alternative measures of profitability or liquidity. Finally, the supplemental reporting measures, as defined by us, may not be comparable to similarly entitled items reported by other financial institutions or other companies. Please see the exhibits for reconciliations of our supplemental reporting measures.

Consolidated Balance Sheets (Unaudited)
Premier Financial Corp.
December 31, September 30, June 30, March 31, December 31,
(in thousands)

2022

2022

2022

2022

2021

Assets
Cash and cash equivalents
Cash and amounts due from depositories

$

88,257

$

67,124

$

62,080

$

62,083

$

54,858

Interest-bearing deposits

39,903

37,868

72,314

91,683

106,708

128,160

104,992

134,394

153,766

161,566

Available-for-sale, carried at fair value

1,040,081

1,063,713

1,140,466

1,219,365

1,206,260

Equity securities, carried at fair value

7,832

15,336

13,293

13,454

14,097

Securities investments

1,047,913

1,079,049

1,153,759

1,232,819

1,220,357

Loans (1)

6,460,620

6,207,708

5,890,823

5,388,331

5,296,168

Allowance for credit losses - loans

(72,816

)

(70,626

)

(67,074

)

(67,195

)

(66,468

)

Loans, net

6,387,804

6,137,082

5,823,749

5,321,136

5,229,700

Loans held for sale

115,251

129,142

145,092

153,498

162,947

Mortgage servicing rights

21,171

20,832

20,693

20,715

19,538

Accrued interest receivable

28,709

26,021

22,533

21,765

20,767

Federal Home Loan Bank stock

29,185

28,262

23,991

15,332

11,585

Bank Owned Life Insurance

170,713

169,728

168,746

167,763

166,767

Office properties and equipment

55,541

53,747

54,060

54,684

55,602

Real estate and other assets held for sale

619

416

462

253

171

Goodwill

317,988

317,948

317,948

317,948

317,948

Core deposit and other intangibles

19,074

19,972

21,311

22,691

24,129

Other assets

133,214

148,949

123,886

108,510

90,325

Total Assets

$

8,455,342

$

8,236,140

$

8,010,624

$

7,590,880

$

7,481,402

Liabilities and Stockholders’ Equity
Non-interest-bearing deposits

$

1,869,509

$

1,826,511

$

1,786,516

$

1,733,157

$

1,724,772

Interest-bearing deposits

4,893,502

4,836,113

4,729,828

4,584,078

4,557,279

Brokered deposits

143,708

69,881

-

-

-

Total deposits

6,906,719

6,732,505

6,516,344

6,317,235

6,282,051

Advances from FHLB

428,000

411,000

380,000

150,000

-

Notes payable and other interest-bearing liabilities

-

-

-

-

-

Subordinated debentures

85,103

85,071

85,039

85,008

84,976

Advance payments by borrowers

34,188

33,511

40,344

20,332

24,716

Reserve for credit losses - unfunded commitments

6,816

7,061

6,755

5,340

5,031

Other liabilities

106,795

102,032

80,995

69,669

61,132

Total Liabilities

7,567,621

7,371,180

7,109,477

6,647,584

6,457,906

Stockholders’ Equity
Preferred stock

-

-

-

-

-

Common stock, net

306

306

306

306

306

Additional paid-in-capital

691,453

691,578

690,905

691,350

691,132

Accumulated other comprehensive income (loss)

(173,460

)

(181,231

)

(126,754

)

(75,497

)

(3,428

)

Retained earnings

502,909

488,305

470,779

459,087

443,517

Treasury stock, at cost

(133,487

)

(133,998

)

(134,089

)

(131,950

)

(108,031

)

Total Stockholders’ Equity

887,721

864,960

901,147

943,296

1,023,496

Total Liabilities and Stockholders’ Equity

$

8,455,342

$

8,236,140

$

8,010,624

$

7,590,880

$

7,481,402

(1) Includes PPP loans of:

$

1,143

$

1,181

$

4,561

$

18,660

$

58,906

Consolidated Statements of Income (Unaudited)
Premier Financial Corp.
Three Months Ended Twelve Months Ended
(in thousands, except per share amounts) 12/31/22 9/30/22 6/30/22 3/31/22 12/31/21 12/31/22 12/31/21
Interest Income:
Loans

$

72,194

$

65,559

$

56,567

$

55,241

$

55,007

$

249,561

$

223,787

Investment securities

7,605

6,814

6,197

5,479

5,369

26,095

19,369

Interest-bearing deposits

444

221

120

46

56

831

198

FHLB stock dividends

482

510

174

59

58

1,225

233

Total interest income

80,725

73,104

63,058

60,825

60,490

277,712

243,587

Interest Expense:
Deposits

13,161

6,855

2,671

2,222

2,615

24,909

13,482

FHLB advances

3,941

2,069

527

13

-

6,550

23

Subordinated debentures

1,000

868

763

696

673

3,327

2,713

Notes Payable

4

-

1

-

-

5

-

Total interest expense

18,106

9,792

3,962

2,931

3,288

34,791

16,218

Net interest income

62,619

63,312

59,096

57,894

57,202

242,921

227,369

Provision (benefit) for credit losses - loans

3,020

3,706

5,151

626

2,816

12,503

(6,733

)

Provision (benefit) for credit losses - unfunded commitments

(246

)

306

1,415

309

(807

)

1,784

(319

)

Total provision (benefit) for credit losses

2,774

4,012

6,566

935

2,009

14,287

(7,052

)

Net interest income after provision

59,845

59,300

52,530

56,959

55,193

228,634

234,421

Non-interest Income:
Service fees and other charges

6,632

6,545

6,676

6,000

6,351

25,853

24,168

Mortgage banking income

(299

)

3,970

1,948

4,252

3,060

9,871

21,925

Gain (loss) on sale of available for sale securities

1

-

-

-

-

1

2,218

Gain (loss) on equity securities

1,209

43

(1,161

)

(643

)

1,132

(551

)

1,954

Insurance commissions

3,576

3,488

4,334

4,639

3,379

16,228

15,780

Wealth management income

1,582

1,355

1,414

1,477

1,383

5,828

6,027

Income from Bank Owned Life Insurance

984

983

983

996

2,145

3,946

5,121

Other non-interest income

543

320

171

142

129

984

2,133

Total Non-interest Income

14,228

16,704

14,365

16,863

17,579

62,160

79,326

Non-interest Expense:
Compensation and benefits

24,999

24,522

22,334

25,541

24,247

97,396

90,646

Occupancy

3,383

3,463

3,494

3,700

3,859

14,039

15,501

FDIC insurance premium

1,276

976

802

593

781

3,647

2,896

Financial institutions tax

795

1,050

1,074

1,191

526

4,110

4,079

Data processing

3,882

3,121

3,442

3,335

3,447

13,780

13,550

Amortization of intangibles

1,293

1,338

1,380

1,438

1,483

5,450

6,208

Other non-interest expense

7,400

6,629

6,563

5,497

7,145

26,089

24,444

Total Non-interest Expense

43,028

41,099

39,089

41,295

41,488

164,511

157,324

Income before income taxes

31,045

34,905

27,806

32,527

31,284

126,283

156,423

Income tax expense

5,770

6,710

5,446

6,170

5,974

24,096

30,372

Net Income

$

25,275

$

28,195

$

22,360

$

26,357

$

25,310

$

102,187

$

126,051

Earnings per common share:
Basic

$

0.71

$

0.79

$

0.63

$

0.73

$

0.69

$

2.86

$

3.39

Diluted

$

0.71

$

0.79

$

0.63

$

0.73

$

0.69

$

2.85

$

3.39

Average Shares Outstanding:
Basic

35,589

35,582

35,560

35,978

36,740

35,679

37,109

Diluted

35,790

35,704

35,682

36,090

36,848

35,809

37,200

Premier Financial Corp.
Selected Quarterly Information
(dollars in thousands,
except per share data)

4Q22

3Q22

2Q22

1Q22

4Q21

YTD 2022 YTD 2021
Summary of Operations
Tax-equivalent interest income (1)

$

80,889

$

73,301

$

63,283

$

61,054

$

60,740

$

278,526

$

244,600

Interest expense

18,106

9,792

3,962

2,931

3,288

34,791

16,218

Tax-equivalent net interest income (1)

62,783

63,509

59,321

58,123

57,452

243,735

228,382

Provision expense (benefit) for credit losses

2,774

4,012

6,566

935

2,009

14,287

(7,052

)

Investment securities gains (losses)

1,210

43

(1,161

)

(643

)

1,132

(550

)

4,172

Non-interest income (ex securities gains/losses)

13,018

16,661

15,526

17,506

16,447

62,710

75,154

Non-interest expense

43,028

41,099

39,089

41,295

41,488

164,511

157,324

Income tax expense

5,770

6,710

5,446

6,170

5,974

24,096

30,372

Net income

25,275

28,195

22,360

26,357

25,310

102,187

126,051

Tax equivalent adjustment (1)

164

197

225

229

250

814

1,013

At Period End
Total assets

$

8,455,342

$

8,236,140

$

8,010,624

$

7,590,880

$

7,481,402

Goodwill and intangibles

337,062

337,920

339,259

340,639

342,077

Tangible assets (2)

8,118,280

7,898,220

7,671,365

7,250,241

7,139,325

Earning assets

7,620,056

7,411,403

7,218,905

6,881,663

6,797,765

Loans

6,460,620

6,207,708

5,890,823

5,388,331

5,296,168

Allowance for loan losses

72,816

70,626

67,074

67,195

66,468

Deposits

6,906,719

6,732,505

6,516,344

6,317,235

6,282,051

Stockholders’ equity

887,721

864,960

901,147

943,296

1,023,496

Stockholders’ equity / assets

10.50

%

10.50

%

11.25

%

12.43

%

13.68

%

Tangible equity (2)

550,659

527,040

561,888

602,657

681,419

Tangible equity / tangible assets

6.78

%

6.67

%

7.32

%

8.31

%

9.54

%

Average Balances
Total assets

$

8,304,462

$

8,161,389

$

7,742,550

$

7,541,414

$

7,510,397

$

7,932,398

$

7,482,578

Earning assets

7,653,648

7,477,795

7,051,661

6,754,862

6,736,250

7,237,621

6,732,178

Loans

6,359,564

6,120,324

5,667,853

5,382,825

5,356,113

5,885,969

5,473,668

Deposits and interest-bearing liabilities

7,278,531

7,116,910

6,706,250

6,415,483

6,386,341

6,882,309

6,385,080

Deposits

6,773,382

6,654,328

6,385,857

6,314,217

6,301,384

6,533,539

6,287,531

Stockholders’ equity

875,287

912,224

921,847

1,033,816

1,035,717

927,534

1,009,037

Goodwill and intangibles

337,207

338,583

339,932

341,353

342,853

339,255

345,187

Tangible equity (2)

538,080

573,641

581,915

692,463

692,864

588,279

663,850

Per Common Share Data
Net Income (Loss):
Basic

$

0.71

$

0.79

$

0.63

$

0.73

$

0.69

$

2.86

$

3.39

Diluted

0.71

0.79

0.63

0.73

0.69

2.85

3.39

Dividends Paid

0.30

0.30

0.30

0.30

0.28

1.20

1.05

Market Value:
High

$

30.51

$

29.36

$

30.13

$

32.52

$

34.00

$

32.52

$

35.90

Low

26.11

24.67

25.31

28.58

28.75

24.67

22.23

Close

26.97

25.70

25.35

30.33

30.91

26.97

30.91

Common Book Value

24.94

24.32

25.35

26.48

28.13

Tangible Common Book Value (2)

15.47

14.82

15.80

16.92

18.73

Shares outstanding, end of period (000s)

35,591

35,563

35,555

35,621

36,384

Performance Ratios (annualized)
Tax-equivalent net interest margin (1)

3.28

%

3.40

%

3.36

%

3.44

%

3.41

%

3.37

%

3.39

%

Return on average assets

1.21

%

1.37

%

1.16

%

1.42

%

1.34

%

1.29

%

1.68

%

Return on average equity

11.46

%

12.26

%

9.73

%

10.34

%

9.70

%

11.02

%

12.49

%

Return on average tangible equity

18.64

%

19.50

%

15.41

%

15.44

%

14.49

%

17.37

%

18.99

%

Efficiency ratio (3)

56.76

%

51.26

%

52.23

%

54.60

%

56.14

%

53.68

%

51.83

%

Effective tax rate

18.59

%

19.22

%

19.59

%

18.97

%

19.10

%

19.08

%

19.42

%

Common dividend payout ratio

42.25

%

37.97

%

47.62

%

41.10

%

40.58

%

42.11

%

30.97

%

(1) Interest income on tax-exempt securities and loans has been adjusted to a tax-equivalent basis using the statutory federal income tax rate of 21%.
(2) Tangible assets = total assets less the sum of goodwill and core deposit and other intangibles. Tangible equity = total stockholders' equity less the sum of goodwill, core deposit and other intangibles, and preferred stock. Tangible common book value = tangible equity divided by shares outstanding at the end of the period.
(3) Efficiency ratio = Non-interest expense divided by sum of tax-equivalent net interest income plus non-interest income, excluding securities gains or losses, net.
Premier Financial Corp.
Yield Analysis
(dollars in thousands)
Three Months Ended Twelve Months Ended
12/31/22 9/30/22 6/30/22 3/31/22 12/31/21 12/31/22 12/31/21
Average Balances
Interest-earning assets:
Loans receivable (1)

$

6,359,564

$

6,120,324

$

5,667,853

$

5,382,825

$

5,356,113

$

5,885,969

$

5,473,668

Securities

1,235,814

1,261,527

1,288,073

1,250,321

1,245,096

1,258,901

1,135,434

Interest Bearing Deposits

29,884

68,530

76,401

109,757

123,456

70,917

111,433

FHLB stock

28,386

27,414

19,334

11,959

11,585

21,834

11,643

Total interest-earning assets

7,653,648

7,477,795

7,051,661

6,754,862

6,736,250

7,237,621

6,732,178

Non-interest-earning assets

650,814

683,594

690,889

786,552

774,147

694,777

750,400

Total assets

$

8,304,462

$

8,161,389

$

7,742,550

$

7,541,414

$

7,510,397

$

7,932,398

$

7,482,578

Deposits and Interest-bearing Liabilities:
Interest bearing deposits

$

4,901,412

$

4,846,419

$

4,614,223

$

4,600,801

$

4,609,064

$

4,741,827

$

4,611,525

FHLB advances and other

419,761

377,533

234,945

16,278

-

263,551

12,586

Subordinated debentures

85,084

85,049

85,020

84,988

84,957

85,036

84,911

Notes payable

304

-

428

-

-

183

52

Total interest-bearing liabilities

5,406,561

5,309,001

4,934,616

4,702,067

4,694,021

5,090,597

4,709,074

Non-interest bearing deposits

1,871,970

1,807,909

1,771,634

1,713,416

1,692,320

1,791,712

1,676,006

Total including non-interest-bearing deposits

7,278,531

7,116,910

6,706,250

6,415,483

6,386,341

6,882,309

6,385,080

Other non-interest-bearing liabilities

150,644

132,255

114,453

92,115

88,339

122,555

88,461

Total liabilities

7,429,175

7,249,165

6,820,703

6,507,598

6,474,680

7,004,864

6,473,541

Stockholders' equity

875,287

912,224

921,847

1,033,816

1,035,717

927,534

1,009,037

Total liabilities and stockholders' equity

$

8,304,462

$

8,161,389

$

7,742,550

$

7,541,414

$

7,510,397

$

7,932,398

$

7,482,578

Average interest-earning assets to interest-bearing liabilities

142

%

141

%

143

%

144

%

144

%

142

%

143

%

Interest Income/Expense
Interest-earning assets:
Loans receivable (2)

$

72,201

$

65,564

$

56,573

$

55,248

$

55,013

$

249,586

$

223,823

Securities (2)

7,762

7,006

6,416

5,701

5,612

26,884

20,346

Interest Bearing Deposits

444

221

120

46

56

831

198

FHLB stock

482

510

174

59

59

1,225

233

Total interest-earning assets

80,889

73,301

63,283

61,054

60,740

278,526

244,600

Deposits and Interest-bearing Liabilities:
Interest bearing deposits

$

13,161

$

6,855

$

2,671

$

2,222

$

2,615

$

24,909

$

13,482

FHLB advances and other

3,941

2,069

527

13

-

6,550

23

Subordinated debentures

1,001

868

763

696

673

3,327

2,713

Notes payable

3

-

1

-

-

5

-

Total interest-bearing liabilities

18,106

9,792

3,962

2,931

3,288

34,791

16,218

Non-interest bearing deposits

-

-

-

-

-

-

-

Total including non-interest-bearing deposits

18,106

9,792

3,962

2,931

3,288

34,791

16,218

Net interest income

$

62,783

$

63,509

$

59,321

$

58,123

$

57,452

$

243,735

$

228,382

Less: PPP income

(6

)

(26

)

(160

)

(3,641

)

(2,686

)

(3,833

)

(14,544

)

Less: Acquisition marks accretion

(554

)

(608

)

(706

)

(737

)

(1,595

)

(2,606

)

(5,869

)

Core net interest income

$

62,223

$

62,875

$

58,455

$

53,745

$

53,171

$

237,296

$

207,969

Average Rates (3)
Interest-earning assets:
Loans receivable

4.54

%

4.29

%

3.99

%

4.11

%

4.11

%

4.24

%

4.09

%

Securities (4)

2.51

%

2.22

%

1.99

%

1.82

%

1.80

%

2.14

%

1.79

%

Interest Bearing Deposits

5.94

%

1.29

%

0.63

%

0.17

%

0.18

%

1.17

%

0.18

%

FHLB stock

6.79

%

7.44

%

3.60

%

1.97

%

2.04

%

5.61

%

2.00

%

Total interest-earning assets

4.23

%

3.92

%

3.59

%

3.62

%

3.61

%

3.85

%

3.63

%

Deposits and Interest-bearing Liabilities:
Interest bearing deposits

1.07

%

0.57

%

0.23

%

0.19

%

0.23

%

0.53

%

0.29

%

FHLB advances and other

3.76

%

2.19

%

0.90

%

0.32

%

0.00

%

2.49

%

0.18

%

Subordinated debentures

4.71

%

4.08

%

3.59

%

3.28

%

3.17

%

3.91

%

3.20

%

Notes payable

3.95

%

-

0.93

%

-

-

2.73

%

0.75

%

Total interest-bearing liabilities

1.34

%

0.74

%

0.32

%

0.25

%

0.28

%

0.68

%

0.37

%

Non-interest bearing deposits

-

-

-

-

-

-

-

Total including non-interest-bearing deposits

1.00

%

0.55

%

0.24

%

0.18

%

0.21

%

0.51

%

0.25

%

Net interest spread

2.89

%

3.18

%

3.27

%

3.37

%

3.33

%

3.17

%

3.29

%

Net interest margin (5)

3.28

%

3.40

%

3.36

%

3.44

%

3.41

%

3.37

%

3.39

%

Core net interest margin (5)

3.25

%

3.36

%

3.32

%

3.20

%

3.21

%

3.28

%

3.24

%

(1) Includes average PPP loans of:

$

1,160

$

1,889

$

12,966

$

32,853

$

101,804

$

12,102

$

282,693

(2) Interest on certain tax exempt loans and securities is not taxable for Federal income tax purposes. In order to compare the tax-exempt yields on these assets to taxable yields, the interest earned on these assets is adjusted to a pre-tax equivalent amount based on the marginal corporate federal income tax rate of 21%.
(3) Annualized.
(4) Securities yield = annualized interest income divided by the average balance of securities, excluding average unrealized gains/losses.
(5) Net interest margin is tax equivalent net interest income divided by average interest-earning assets. Core net interest margin represents net interest margin excluding PPP and acquisition marks accretion.
Premier Financial Corp.
Loans and Deposits Composition
(dollars in thousands)

4Q22

3Q22

2Q22

1Q22

4Q21

Loan Portfolio Composition
Residential real estate

$

1,535,574

$

1,478,360

$

1,382,202

$

1,222,057

$

1,167,466

Residential real estate construction

176,737

119,204

85,256

97,746

121,621

Total residential loans

1,712,311

1,597,564

1,467,458

1,319,803

1,289,087

Commercial real estate

2,762,311

2,674,078

2,655,730

2,495,469

2,450,349

Commercial construction

428,743

398,044

319,590

260,421

263,304

Commercial excluding PPP

1,054,037

1,041,423

987,242

891,893

836,732

Core commercial loans (1)

4,245,091

4,113,545

3,962,562

3,647,783

3,550,385

Consumer direct/indirect

213,405

212,790

180,539

132,294

126,417

Home equity and improvement lines

277,613

272,367

266,144

261,176

264,354

Total consumer loans

491,018

485,157

446,683

393,470

390,771

Deferred loan origination fees

11,057

10,261

9,559

8,615

7,019

Core loans (1)

6,459,477

6,206,527

5,886,262

5,369,671

5,237,262

PPP loans

1,143

1,181

4,561

18,660

58,906

Total loans

$

6,460,620

$

6,207,708

$

5,890,823

$

5,388,331

$

5,296,168

Loans held for sale

$

115,251

$

129,142

$

145,092

$

153,498

$

162,947

Core residential loans (1)

1,827,562

1,726,706

1,612,550

1,473,301

1,452,034

Total loans including loans held for sale but excluding PPP

6,574,728

6,335,669

6,031,354

5,523,169

5,400,209

Undisbursed construction loan funds - residential

$

209,306

$

231,598

$

239,748

$

210,702

$

204,772

Undisbursed construction loan funds - commercial

463,469

493,199

449,101

314,843

273,118

Undisbursed construction loan funds - total

672,775

724,797

688,849

525,545

477,890

Total construction loans including undisbursed funds

$

1,278,255

$

1,242,045

$

1,093,695

$

883,712

$

862,815

Gross loans (2)

$

7,122,338

$

6,922,244

$

6,570,113

$

5,905,261

$

5,767,039

Deposit Portfolio Composition
Non-interest-bearing demand deposits

$

1,869,509

$

1,826,511

$

1,786,516

$

1,733,157

$

1,724,772

Interest-bearing demand deposits

1,048,666

1,084,550

1,060,308

1,135,088

1,015,795

Savings deposits

798,003

820,650

832,859

830,143

804,451

Money market account deposits

2,136,774

2,112,905

2,045,998

1,894,172

1,936,910

Retail time deposits less than $250

645,318

550,275

532,836

586,967

636,477

Retail time deposits greater than $250

264,741

267,733

257,827

137,708

163,646

Brokered deposits

143,708

69,881

-

-

-

Total deposits

$

6,906,719

$

6,732,505

$

6,516,344

$

6,317,235

$

6,282,051

(1) Core loans represents total loans excluding undisbursed loan funds, deferred loan origination fees and PPP loans. Core commercial loans represents total commercial real estate, commercial and commercial construction excluding commercial undisbursed loan funds, deferred loan origination fees and PPP loans. Core residential loans represents total loans held for sale, one to four family residential real estate and residential construction excluding residential undisbursed loan funds and deferred loan origination fees.
(2) Gross loans represent total loans including undisbursed construction funds but excluding deferred loan origination fees.
Premier Financial Corp.
Loan Delinquency Information
(dollars in thousands) Total Balance Current 30 to 89 days past
due
% of
Total
Non Accrual
Loans
% of
Total
December 31, 2022
One to four family residential real estate

$

1,535,574

$

1,520,074

$

6,792

0.4

%

$

8,708

0.6

%

Construction

1,278,255

1,277,818

437

0.0

%

-

0.0

%

Commercial real estate

2,762,311

2,747,539

1,205

0.0

%

13,567

0.5

%

Commercial

1,055,180

1,047,829

497

0.0

%

6,854

0.6

%

Home equity and improvement

277,613

270,138

5,216

1.9

%

2,259

0.8

%

Consumer finance

213,405

206,779

4,192

2.0

%

2,434

1.1

%

Gross loans

$

7,122,338

$

7,070,177

$

18,339

0.3

%

$

33,822

0.5

%

September 30, 2022
One to four family residential real estate

$

1,478,360

$

1,464,319

$

6,232

0.4

%

$

7,809

0.5

%

Construction

1,242,045

1,242,045

-

0.0

%

-

0.0

%

Commercial real estate

2,674,078

2,660,068

116

0.0

%

13,894

0.5

%

Commercial

1,042,604

1,034,898

338

0.0

%

7,368

0.7

%

Home equity and improvement

272,367

267,077

3,144

1.2

%

2,146

0.8

%

Consumer finance

212,790

207,453

3,417

1.6

%

1,920

0.9

%

Gross loans

$

6,922,244

$

6,875,860

$

13,247

0.2

%

$

33,137

0.5

%

December 31, 2021
One to four family residential real estate

$

1,167,466

$

1,149,333

$

6,212

0.5

%

$

11,921

1.0

%

Construction

862,815

861,326

1,489

0.2

%

-

0.0

%

Commercial real estate

2,450,349

2,435,491

15

0.0

%

14,843

0.6

%

Commercial

895,638

879,521

76

0.0

%

16,041

1.8

%

Home equity and improvement

264,354

258,661

2,517

1.0

%

3,176

1.2

%

Consumer finance

126,417

122,361

2,023

1.6

%

2,033

1.6

%

Gross loans

$

5,767,039

$

5,706,693

$

12,332

0.2

%

$

48,014

0.8

%

Loan Risk Ratings Information
(dollars in thousands) Total Balance Pass Rated Special Mention % of
Total
Classified % of
Total
December 31, 2022
One to four family residential real estate

$

1,524,029

$

1,514,719

$

935

0.1

%

$

8,375

0.5

%

Construction

1,278,255

1,278,255

-

0.0

%

-

0.0

%

Commercial real estate

2,760,766

2,694,443

46,029

1.7

%

20,294

0.7

%

Commercial

1,050,122

1,016,973

26,319

2.5

%

6,830

0.7

%

Home equity and improvement

275,204

273,613

-

0.0

%

1,591

0.6

%

Consumer finance

213,131

210,760

-

0.0

%

2,371

1.1

%

PCD loans

20,831

13,904

2,590

12.4

%

4,337

20.8

%

Gross loans

$

7,122,338

$

7,002,667

$

75,873

1.1

%

$

43,798

0.6

%

September 30, 2022
One to four family residential real estate

$

1,466,470

$

1,458,082

$

1,267

0.1

%

$

7,121

0.5

%

Construction

1,242,045

1,240,745

1,300

0.1

%

-

0.0

%

Commercial real estate

2,672,451

2,584,984

65,233

2.4

%

22,234

0.8

%

Commercial

1,036,441

1,009,384

20,106

1.9

%

6,951

0.7

%

Home equity and improvement

269,786

268,384

-

0.0

%

1,402

0.5

%

Consumer finance

212,493

210,602

-

0.0

%

1,891

0.9

%

PCD loans

22,558

17,044

93

0.4

%

5,421

24.0

%

Gross loans

$

6,922,244

$

6,789,225

$

87,999

1.3

%

$

45,020

0.7

%

December 31, 2021
One to four family residential real estate

$

1,154,070

$

1,142,688

$

1,316

0.1

%

$

10,066

0.9

%

Construction

862,815

843,293

19,522

2.3

%

-

0.0

%

Commercial real estate

2,444,471

2,321,654

93,676

3.8

%

29,141

1.2

%

Commercial

886,472

857,905

14,815

1.7

%

13,752

1.6

%

Home equity and improvement

260,948

258,914

-

0.0

%

2,034

0.8

%

Consumer finance

125,926

124,073

-

0.0

%

1,853

1.5

%

PCD loans

32,337

19,547

101

0.3

%

12,689

39.2

%

Gross loans

$

5,767,039

$

5,568,074

$

129,430

2.2

%

$

69,535

1.2

%

Premier Financial Corp.
Selected Quarterly Information
(dollars in thousands)
As of and for the three months ended Twelve months ended
Mortgage Banking Summary 12/31/22 9/30/22 6/30/22 3/31/22 12/31/21 12/31/22 12/31/21
Revenue from sales and servicing of mortgage loans:
Mortgage banking gains, net

$

(1,285

)

$

3,363

$

1,166

$

2,543

$

2,774

$

5,787

$

16,437

Mortgage loan servicing revenue (expense):
Mortgage loan servicing revenue

1,862

1,861

1,862

1,879

1,909

7,464

7,574

Amortization of mortgage servicing rights

(1,271

)

(1,350

)

(1,375

)

(1,403

)

(1,774

)

(5,399

)

(7,892

)

Mortgage servicing rights valuation adjustments

396

96

295

1,233

151

2,019

5,806

987

607

782

1,709

286

4,084

5,488

Total revenue from sale/servicing of mortgage loans

$

(298

)

$

3,970

$

1,948

$

4,252

$

3,060

$

9,871

$

21,925

Mortgage servicing rights:
Balance at beginning of period

$

21,915

$

21,872

$

22,189

$

22,244

$

21,963

$

22,244

$

21,666

Loans sold, servicing retained

1,214

1,393

1,058

1,348

2,056

5,013

8,471

Amortization

(1,271

)

(1,350

)

(1,375

)

(1,403

)

(1,774

)

(5,399

)

(7,893

)

Balance at end of period

21,858

21,915

21,872

22,189

22,245

21,858

22,244

Valuation allowance:
Balance at beginning of period

(1,083

)

(1,179

)

(1,474

)

(2,707

)

(2,858

)

(2,706

)

(8,513

)

Impairment recovery (charges)

396

96

295

1,233

151

2,019

5,807

Balance at end of period

(687

)

(1,083

)

(1,179

)

(1,474

)

(2,707

)

(687

)

(2,706

)

Net carrying value at end of period

$

21,171

$

20,832

$

20,693

$

20,715

$

19,538

$

21,171

$

19,538

$

-

Allowance Summary
Beginning allowance

$

70,626

$

67,074

$

67,195

$

66,468

$

73,217

$

66,468

$

82,079

Provision (benefit) for credit losses - loans

3,020

3,706

5,151

626

2,816

12,503

(6,733

)

Net recoveries (charge-offs)

(830

)

(154

)

(5,272

)

101

(9,565

)

(6,155

)

(8,878

)

Ending allowance

$

72,816

$

70,626

$

67,074

$

67,195

$

66,468

$

72,816

$

66,468

Total loans

$

6,460,620

$

6,207,708

$

5,890,823

$

5,388,331

$

5,296,168

Less: PPP loans

(1,143

)

(1,181

)

(4,561

)

(18,660

)

(58,906

)

Total loans ex PPP

$

6,459,477

$

6,206,527

$

5,886,262

$

5,369,671

$

5,237,262

Allowance for credit losses (ACL)

$

72,816

$

70,626

$

67,074

$

67,195

$

66,468

Add: Unaccreted purchase accounting marks

2,706

3,291

3,924

4,652

5,418

Adjusted ACL

$

75,522

$

73,917

$

70,998

$

71,847

$

71,886

ACL/Loans

1.13

%

1.14

%

1.14

%

1.25

%

1.26

%

Adjusted ACL/Loans ex PPP

1.17

%

1.19

%

1.21

%

1.34

%

1.37

%

Credit Quality
Total non-performing loans (1)

$

33,822

$

33,137

$

34,735

$

47,298

$

48,014

Real estate owned (REO)

619

416

462

253

171

Total non-performing assets (2)

$

34,441

$

33,553

$

35,197

$

47,551

$

48,185

Net charge-offs (recoveries)

830

154

5,272

(101

)

9,565

Restructured loans, accruing (3)

6,587

6,909

5,899

6,287

7,768

Allowance for credit losses - loans / loans

1.13

%

1.14

%

1.14

%

1.25

%

1.26

%

Allowance for credit losses - loans / non-performing assets

211.42

%

210.49

%

190.57

%

141.31

%

137.94

%

Allowance for credit losses - loans / non-performing loans

215.29

%

213.13

%

193.10

%

142.07

%

138.43

%

Non-performing assets / loans plus REO

0.53

%

0.54

%

0.60

%

0.88

%

0.91

%

Non-performing assets / total assets

0.41

%

0.41

%

0.44

%

0.63

%

0.64

%

Net charge-offs / average loans (annualized)

0.05

%

0.01

%

0.37

%

-0.01

%

0.71

%

Net charge-offs / average loans LTM

0.10

%

0.26

%

0.27

%

0.17

%

0.16

%

(1) Non-performing loans consist of non-accrual loans.
(2) Non-performing assets are non-performing loans plus real estate and other assets acquired by foreclosure or deed-in-lieu thereof.
(3) Accruing restructured loans are loans with known credit problems that are not contractually past due and therefore are not included in non-performing loans.