First Midwest Bancorp, Inc. Announces 2021 Fourth Quarter and Full Year Results
First Midwest Bancorp reported Q4 2021 net income of $44 million ($0.39/share), down from $50 million in Q3 2021, yet up from $37 million in Q4 2020. Full-year net income rose to $182 million ($1.60/share), an 84% increase from 2020. Total revenue for Q4 was $183 million, reflecting a 4% rise year-over-year. Loans increased by 3% to $15 billion, with deposits rising 10% to $17 billion. The company is preparing for a merger with Old National Bank, valued at $6.5 billion, enhancing its market position significantly.
- Net income increased 84% year-over-year to $182 million.
- Total revenue for Q4 2021 rose 4% to $183 million.
- Loans grew by 3% to $15 billion.
- Total average deposits increased by 10% to $17 billion.
- Strong capital levels with Tier 1 capital at 12.22%.
- Q4 2021 net income decreased 12% from Q3 2021.
- Net interest income declined by 6% compared to Q4 2020.
- Net interest margin decreased by 39 basis points from Q4 2020.
CHICAGO, Jan. 18, 2022 (GLOBE NEWSWIRE) -- First Midwest Bancorp, Inc. (the "Company" or "First Midwest"), the holding company of First Midwest Bank (the "Bank"), today reported results of operations and financial condition for the fourth quarter and full year of 2021. Net income applicable to common shares for the fourth quarter of 2021 was
Comparative results for all periods were impacted by the timing of costs related to acquisitions. In addition, certain periods were impacted by retail and balance sheet optimization strategies, and securities gains, as well as the Company's response to the COVID-19 pandemic (the "pandemic") and federal, state and local responses to the pandemic. To facilitate comparisons between periods, adjustments to reported results have been made to reflect these impacts. For additional detail on these adjustments, see the "Non-GAAP Financial Information" section presented later in this release.
FOURTH QUARTER AND FULL YEAR HIGHLIGHTS
- Improved diluted EPS to
$0.39 for the fourth quarter of 2021 and$1.60 for the full year of 2021, up18% and84% from the same periods in 2020; down5% and up44% on an adjusted(1) basis, respectively.- Generated total revenue of
$183 million for the fourth quarter of 2021 and$751 million for the full year of 2021, both up4% from the same periods in 2020.- Net interest income and margin down
6% and 39 basis points ("bps"), respectively, from the fourth quarter of 2020 and down2% and 27 bps from the full year of 2020, reflective of the lower interest rate environment and elevated liquidity. - Fee-based revenues up
1% and15% from the fourth quarter of 2020 and full year of 2020, respectively.
- Net interest income and margin down
- Controlled noninterest expense to average assets of
2.18% for the fourth quarter of 2021 and2.21% for the full year of 2021, down 7 bps and 17 bps from the same periods in 2020.
- Generated total revenue of
- Grew total loans to
$15 billion , up3% from the prior year, excluding PPP loans. - Increased total average deposits to
$17 billion for both the fourth quarter and full year of 2021, up10% and13% from the same periods in 2020. - Established the allowance for credit losses ("ACL") at
$210 million , or1.45% of total loans, excluding PPP loans, compared to1.77% at December 31, 2020, reflective of improving credit environment.- Lowered non-performing assets and performing loans classified as substandard and special mention
21% and16% , respectively, compared to December 31, 2020. - Reduced net loan charge-offs ("NCOs") to average loans to
0.05% for the fourth quarter of 2021 and0.23% for the full year of 2021, compared to0.12% and0.24% for the same periods in 2020, excluding purchased credit deteriorated ("PCD") and PPP loans.
- Lowered non-performing assets and performing loans classified as substandard and special mention
- Generated 67 bps of Tier 1 capital to risk-weighted assets during 2021, ending the year at
12.2% , largely reflective of higher retained earnings.
"The best of First Midwest was once again on display throughout 2021," said Michael L. Scudder, Chairman of the Board and Chief Executive Officer of the Company. "The year's financial results were strong, reflecting solid operating performance. I am extremely proud of our 2,000 colleagues who represent First Midwest each day. Amid the demands of an ongoing health crisis and challenging operating environment, they have remained agile and focused – all while working tirelessly to help support our clients, communities, and each other."
Mr. Scudder continued, "We are very encouraged and excited about what lies ahead for our Company. Strong capital levels and a highly engaged team provide operating flexibility as we see economic recovery and growing opportunities for business expansion. As we look to our future, our ongoing integration planning efforts relative to our announced business combination with Old National Bank are on pace and in line with our expectations. This combination will see us grow to become one of the Midwest’s largest commercial banks and position us well for continued expansion, investment, and innovation in talent, capabilities, and services – all to the benefit of our clients, colleagues, communities and stockholders."
PENDING MERGER
First Midwest and Old National Bancorp
On June 1, 2021, the Company and Old National Bancorp ("Old National"), the holding company for Old National Bank, jointly announced that they entered into a definitive merger agreement to combine in an all-stock merger of equals transaction to create a premier Midwestern bank with approximately
As of the date of announcement, the overall transaction was valued at approximately
(1) This metric is a non-GAAP financial measure. For details on the calculation of this metric, see the sections titled "Non-GAAP Financial Information" and "Non-GAAP Reconciliations" presented later in this release.
OPERATING PERFORMANCE
Net Interest Income and Margin Analysis
(Dollar amounts in thousands)
Quarters Ended | |||||||||||||||||||||||||||||||
December 31, 2021 | September 30, 2021 | December 31, 2020 | |||||||||||||||||||||||||||||
Average Balance | Interest | Yield/ Rate (%) | Average Balance | Interest | Yield/ Rate (%) | Average Balance | Interest | Yield/ Rate (%) | |||||||||||||||||||||||
Assets | |||||||||||||||||||||||||||||||
Other interest-earning assets | $ | 2,122,042 | $ | 1,462 | 0.27 | $ | 1,672,005 | $ | 1,222 | 0.29 | $ | 1,244,999 | $ | 930 | 0.30 | ||||||||||||||||
Securities(1) | 3,308,840 | 18,711 | 2.26 | 3,265,812 | 16,189 | 1.98 | 3,164,310 | 17,051 | 2.16 | ||||||||||||||||||||||
Federal Home Loan Bank ("FHLB") and Federal Reserve Bank ("FRB") stock | 106,096 | 867 | 3.27 | 106,759 | 852 | 3.19 | 123,287 | 1,342 | 4.35 | ||||||||||||||||||||||
Loans, excluding PPP loans(1) | 14,308,310 | 122,879 | 3.41 | 14,364,785 | 127,631 | 3.53 | 13,335,154 | 126,474 | 3.77 | ||||||||||||||||||||||
PPP loans(1) | 317,553 | 5,119 | 6.40 | 549,380 | 9,772 | 7.06 | 1,013,511 | 15,195 | 5.96 | ||||||||||||||||||||||
Total loans(1) | 14,625,863 | 127,998 | 3.47 | 14,914,165 | 137,403 | 3.66 | 14,348,665 | 141,669 | 3.93 | ||||||||||||||||||||||
Total interest-earning assets(1) | 20,162,841 | 149,038 | 2.94 | 19,958,741 | 155,666 | 3.10 | 18,881,261 | 160,992 | 3.39 | ||||||||||||||||||||||
Cash and due from banks | 286,846 | 277,720 | 252,268 | ||||||||||||||||||||||||||||
Allowance for loan losses | (208,048 | ) | (215,395 | ) | (246,278 | ) | |||||||||||||||||||||||||
Other assets | 1,805,033 | 1,878,494 | 1,995,074 | ||||||||||||||||||||||||||||
Total assets | $ | 22,046,672 | $ | 21,899,560 | $ | 20,882,325 | |||||||||||||||||||||||||
Liabilities and Stockholders' Equity | |||||||||||||||||||||||||||||||
Savings deposits | $ | 2,825,792 | 125 | 0.02 | $ | 2,785,816 | 124 | 0.02 | $ | 2,436,930 | 109 | 0.02 | |||||||||||||||||||
NOW accounts | 3,165,689 | 280 | 0.04 | 3,213,637 | 275 | 0.03 | 2,774,989 | 277 | 0.04 | ||||||||||||||||||||||
Money market deposits | 3,316,492 | 510 | 0.06 | 3,211,355 | 549 | 0.07 | 2,923,881 | 694 | 0.09 | ||||||||||||||||||||||
Time deposits | 1,736,197 | 1,702 | 0.39 | 1,800,493 | 1,915 | 0.42 | 2,047,260 | 3,131 | 0.61 | ||||||||||||||||||||||
Borrowed funds | 1,288,778 | 3,143 | 0.97 | 1,281,968 | 3,146 | 0.97 | 1,661,731 | 4,158 | 1.00 | ||||||||||||||||||||||
Senior and subordinated debt | 235,490 | 3,467 | 5.84 | 235,284 | 3,467 | 5.85 | 234,669 | 3,482 | 5.90 | ||||||||||||||||||||||
Total interest-bearing liabilities | 12,568,438 | 9,227 | 0.29 | 12,528,553 | 9,476 | 0.30 | 12,079,460 | 11,851 | 0.39 | ||||||||||||||||||||||
Demand deposits | 6,411,550 | 6,272,903 | 5,753,600 | ||||||||||||||||||||||||||||
Total funding sources | 18,979,988 | 0.19 | 18,801,456 | 0.20 | 17,833,060 | 0.26 | |||||||||||||||||||||||||
Other liabilities | 336,533 | 364,576 | 373,854 | ||||||||||||||||||||||||||||
Stockholders' equity | 2,730,151 | 2,733,528 | 2,675,411 | ||||||||||||||||||||||||||||
Total liabilities and stockholders' equity | $ | 22,046,672 | $ | 21,899,560 | $ | 20,882,325 | |||||||||||||||||||||||||
Tax-equivalent net interest income/margin(1) | 139,811 | 2.75 | 146,190 | 2.91 | 149,141 | 3.14 | |||||||||||||||||||||||||
Tax-equivalent adjustment | (1,035 | ) | (994 | ) | (1,030 | ) | |||||||||||||||||||||||||
Net interest income (GAAP)(1) | $ | 138,776 | $ | 145,196 | $ | 148,111 | |||||||||||||||||||||||||
Impact of acquired loan accretion(1) | $ | 5,684 | 0.11 | $ | 6,231 | 0.12 | $ | 7,603 | 0.16 | ||||||||||||||||||||||
Tax-equivalent net interest income/margin, adjusted(1) | $ | 134,127 | 2.64 | $ | 139,959 | 2.79 | $ | 141,538 | 2.98 | ||||||||||||||||||||||
(1) Interest income and yields on tax-exempt securities and loans are presented on a tax-equivalent basis, assuming a federal income tax rate of
Net interest income for the fourth quarter of 2021 decreased by
Acquired loan accretion contributed
Tax-equivalent net interest margin for the current quarter was
For the fourth quarter of 2021, total average interest-earning assets increased by
Total average funding sources for the fourth quarter of 2021 increased by
Noninterest Income Analysis
(Dollar amounts in thousands)
Quarters Ended | December 31, 2021 Percent Change From | |||||||||||||||
December 31, 2021 | September 30, 2021 | December 31, 2020 | September 30, 2021 | December 31, 2020 | ||||||||||||
Wealth management fees | $ | 14,246 | $ | 14,820 | $ | 13,548 | (3.9 | ) | 5.2 | |||||||
Service charges on deposit accounts | 12,149 | 11,496 | 10,811 | 5.7 | 12.4 | |||||||||||
Mortgage banking income | 6,149 | 6,664 | 9,191 | (7.7 | ) | (33.1 | ) | |||||||||
Card-based fees, net | 4,451 | 4,992 | 4,530 | (10.8 | ) | (1.7 | ) | |||||||||
Capital market products income | 1,462 | 1,333 | 659 | 9.7 | 121.9 | |||||||||||
Other service charges, commissions, and fees | 3,775 | 2,832 | 2,993 | 33.3 | 26.1 | |||||||||||
Total fee-based revenues | 42,232 | 42,137 | 41,732 | 0.2 | 1.2 | |||||||||||
Other income | 2,247 | 3,043 | 3,550 | (26.2 | ) | (36.7 | ) | |||||||||
Swap termination costs | — | — | (17,567 | ) | N/M | N/M | ||||||||||
Total noninterest income | $ | 44,479 | $ | 45,180 | $ | 27,715 | (1.6 | ) | 60.5 | |||||||
N/M – Not meaningful.
Total noninterest income of
Mortgage banking income for the fourth quarter of 2021 resulted from sales of
Capital market products income increased compared to both prior periods as a result higher levels of sales to corporate clients in light of market conditions. Other service charges, commissions, and fees for the fourth quarter of 2021 was elevated as a result of sales of loans at gains. Other income compared to both prior periods was impacted by lower fair value adjustments on equity securities as a result of the market environment, partially offset by benefit settlements on bank-owned life insurance. In addition, other income for the third quarter of 2021 was elevated as a result of net gains from the disposition of branch properties and other miscellaneous items.
During the fourth quarter of 2020, the Company terminated longer term interest rate swaps with notional amounts of
Noninterest Expense Analysis
(Dollar amounts in thousands)
Quarters Ended | December 31, 2021 Percent Change From | |||||||||||||||||
December 31, 2021 | September 30, 2021 | December 31, 2020 | September 30, 2021 | December 31, 2020 | ||||||||||||||
Salaries and employee benefits: | ||||||||||||||||||
Salaries and wages | $ | 56,334 | $ | 51,503 | $ | 55,950 | 9.4 | 0.7 | ||||||||||
Retirement and other employee benefits | 11,112 | 10,924 | 10,430 | 1.7 | 6.5 | |||||||||||||
Total salaries and employee benefits | 67,446 | 62,427 | 66,380 | 8.0 | 1.6 | |||||||||||||
Net occupancy and equipment expense | 13,550 | 14,198 | 14,002 | (4.6 | ) | (3.2 | ) | |||||||||||
Technology and related costs | 10,468 | 10,742 | 11,005 | (2.6 | ) | (4.9 | ) | |||||||||||
Professional services | 7,620 | 6,991 | 8,424 | 9.0 | (9.5 | ) | ||||||||||||
Advertising and promotions | 2,853 | 3,168 | 1,850 | (9.9 | ) | 54.2 | ||||||||||||
Net other real estate owned ("OREO") expense | 442 | (4 | ) | 106 | N/M | 317.0 | ||||||||||||
Other expenses | 14,565 | 15,616 | 12,851 | (6.7 | ) | 13.3 | ||||||||||||
Acquisition and integration related expenses | 3,945 | 2,916 | 1,860 | 35.3 | 112.1 | |||||||||||||
Optimization costs | — | — | 1,493 | N/M | N/M | |||||||||||||
Total noninterest expense | $ | 120,889 | $ | 116,054 | $ | 117,971 | 4.2 | 2.5 | ||||||||||
Acquisition and integration related expenses | (3,945 | ) | (2,916 | ) | (1,860 | ) | 35.3 | 112.1 | ||||||||||
Optimization costs | — | — | (1,493 | ) | N/M | N/M | ||||||||||||
Total noninterest expense, adjusted(1) | $ | 116,944 | $ | 113,138 | $ | 114,618 | 3.4 | 2.0 | ||||||||||
N/M – Not meaningful.
(1) See the "Non-GAAP Financial Information" section presented later in this release for a discussion of this non-GAAP financial measure.
Total noninterest expense increased
The increase in salaries and employee benefits compared to both prior periods was driven primarily by higher compensation accruals and deferred compensation plan obligations due to income on the respective equity securities held in a grantor trust. Compared to the fourth quarter of 2020, the increase in salaries and employee benefits was impacted by merit increases, partially offset by the ongoing benefits of optimization strategies. Net occupancy expense decreased compared to both prior periods as a result of lower maintenance costs. Professional services expense increased compared to the third quarter of 2021 due mainly to higher loan related fees associated with 1-4 family mortgage production. Compared to the fourth quarter of 2020, professional services expense decreased due primarily to lower loan remediation costs. Advertising and promotions expense increased compared to the fourth quarter of 2020 due to the timing of certain costs related to marketing campaigns. Other expenses decreased compared to the third quarter of 2021 as a result of lower other miscellaneous expenses. Compared to the fourth quarter of 2020, other expenses increased due primarily to higher servicing fees from purchases of consumer loans.
Optimization costs of
Acquisition and integration related expenses for the fourth and third quarters of 2021 resulted from the pending merger with Old National. Acquisition and integration related expenses for the fourth quarter of 2020 resulted from the acquisition of Park Bank, which closed in the first quarter of 2020.
LOAN PORTFOLIO AND ASSET QUALITY
Loan Portfolio Composition
(Dollar amounts in thousands)
As of | December 31, 2021 Percent Change From | ||||||||||||||
December 31, 2021 | September 30, 2021 | December 31, 2020 | September 30, 2021 | December 31, 2020 | |||||||||||
Commercial and industrial | $ | 4,834,332 | $ | 4,705,458 | $ | 4,578,254 | 2.7 | 5.6 | |||||||
Agricultural | 327,873 | 349,159 | 364,038 | (6.1 | ) | (9.9 | ) | ||||||||
Commercial real estate: | |||||||||||||||
Office, retail, and industrial | 1,746,944 | 1,765,592 | 1,861,768 | (1.1 | ) | (6.2 | ) | ||||||||
Multi-family | 1,120,748 | 1,082,941 | 872,813 | 3.5 | 28.4 | ||||||||||
Construction | 588,247 | 595,204 | 612,611 | (1.2 | ) | (4.0 | ) | ||||||||
Other commercial real estate | 1,275,906 | 1,408,955 | 1,481,976 | (9.4 | ) | (13.9 | ) | ||||||||
Total commercial real estate | 4,731,845 | 4,852,692 | 4,829,168 | (2.5 | ) | (2.0 | ) | ||||||||
Total corporate loans, excluding PPP loans | 9,894,050 | 9,907,309 | 9,771,460 | (0.1 | ) | 1.3 | |||||||||
PPP loans | 230,687 | 384,100 | 785,563 | (39.9 | ) | (70.6 | ) | ||||||||
Total corporate loans | 10,124,737 | 10,291,409 | 10,557,023 | (1.6 | ) | (4.1 | ) | ||||||||
Home equity | 565,443 | 591,126 | 761,725 | (4.3 | ) | (25.8 | ) | ||||||||
1-4 family mortgages | 3,418,059 | 3,332,732 | 3,022,413 | 2.6 | 13.1 | ||||||||||
Installment | 557,252 | 573,465 | 410,071 | (2.8 | ) | 35.9 | |||||||||
Total consumer loans | 4,540,754 | 4,497,323 | 4,194,209 | 1.0 | 8.3 | ||||||||||
Total loans | $ | 14,665,491 | $ | 14,788,732 | $ | 14,751,232 | (0.8 | ) | (0.6 | ) | |||||
Total loans includes loans originated under the PPP loan program, which totaled
Consumer loans compared to both prior periods were impacted by purchases of 1-4 family mortgages, as well as strong production in the 1-4 family mortgages portfolio, which was partially offset by higher prepayments. In addition, consumer loans compared to December 31, 2020 were impacted by purchases of installment loans.
Allowance for Credit Losses
(Dollar amounts in thousands)
As of or for the Quarters Ended | December 31, 2021 Percent Change From | |||||||||||||||||
December 31, 2021 | September 30, 2021 | December 31, 2020 | September 30, 2021 | December 31, 2020 | ||||||||||||||
ACL, excluding PCD loans | $ | 190,510 | $ | 195,903 | $ | 215,915 | (2.8 | ) | (11.8 | ) | ||||||||
PCD loan ACL | 19,352 | 18,963 | 31,127 | 2.1 | (37.8 | ) | ||||||||||||
Total ACL | $ | 209,862 | $ | 214,866 | $ | 247,042 | (2.3 | ) | (15.1 | ) | ||||||||
Provision for credit losses | $ | (2,924 | ) | $ | — | $ | 10,507 | N/M | (127.8 | ) | ||||||||
ACL to total loans | 1.43 | % | 1.45 | % | 1.67 | % | ||||||||||||
ACL to total loans, excluding PPP loans(1) | 1.45 | % | 1.49 | % | 1.77 | % | ||||||||||||
ACL to non-accrual loans | 205.79 | % | 243.94 | % | 173.33 | % | ||||||||||||
N/M – Not meaningful.
(1) This ratio excludes PPP loans that are fully guaranteed by the Small Business Administration ("SBA"). As a result, no allowance for credit losses is associated with these loans. See the "Non-GAAP Financial Information" section presented later in this release for a discussion of this non-GAAP financial measure.
The ACL was
Asset Quality
(Dollar amounts in thousands)
As of | December 31, 2021 Percent Change From | |||||||||||||||||
December 31, 2021 | September 30, 2021 | December 31, 2020 | September 30, 2021 | December 31, 2020 | ||||||||||||||
Non-accrual loans, excluding PCD loans(1) | $ | 80,920 | $ | 64,166 | $ | 109,957 | 26.1 | (26.4 | ) | |||||||||
Non-accrual PCD loans | 21,059 | 23,917 | 32,568 | (11.9 | ) | (35.3 | ) | |||||||||||
Total non-accrual loans | 101,979 | 88,083 | 142,525 | 15.8 | (28.4 | ) | ||||||||||||
90 days or more past due loans, still accruing interest(1) | 927 | 1,293 | 4,395 | (28.3 | ) | (78.9 | ) | |||||||||||
Total non-performing loans, ("NPLs") | 102,906 | 89,376 | 146,920 | 15.1 | (30.0 | ) | ||||||||||||
Accruing troubled debt restructurings ("TDRs") | 534 | 539 | 813 | (0.9 | ) | (34.3 | ) | |||||||||||
Foreclosed assets(2) | 25,837 | 26,375 | 16,671 | (2.0 | ) | 55.0 | ||||||||||||
Total non-performing assets ("NPAs") | $ | 129,277 | $ | 116,290 | $ | 164,404 | 11.2 | (21.4 | ) | |||||||||
30-89 days past due loans | $ | 34,430 | $ | 30,718 | $ | 40,656 | 12.1 | (15.3 | ) | |||||||||
Special mention loans(3) | $ | 314,772 | $ | 330,218 | $ | 409,083 | (4.7 | ) | (23.1 | ) | ||||||||
Substandard loans(3) | 325,520 | 351,192 | 357,219 | (7.3 | ) | (8.9 | ) | |||||||||||
Total performing loans classified as substandard and special mention(3) | $ | 640,292 | $ | 681,410 | $ | 766,302 | (6.0 | ) | (16.4 | ) | ||||||||
Non-accrual loans to total loans: | ||||||||||||||||||
Non-accrual loans to total loans | 0.70 | % | 0.60 | % | 0.97 | % | ||||||||||||
Non-accrual loans to total loans, excluding PPP loans(1)(4) | 0.71 | % | 0.61 | % | 1.02 | % | ||||||||||||
Non-accrual loans to total loans, excluding PCD and PPP loans(1)(4) | 0.57 | % | 0.45 | % | 0.80 | % | ||||||||||||
Non-performing loans to total loans: | ||||||||||||||||||
NPLs to total loans | 0.70 | % | 0.60 | % | 1.00 | % | ||||||||||||
NPLs to total loans, excluding PPP loans(1)(4) | 0.71 | % | 0.62 | % | 1.05 | % | ||||||||||||
NPLs to total loans, excluding PCD and PPP loans(1)(4) | 0.57 | % | 0.46 | % | 0.83 | % | ||||||||||||
Non-performing assets to total loans plus foreclosed assets: | ||||||||||||||||||
NPAs to total loans plus foreclosed assets | 0.88 | % | 0.78 | % | 1.11 | % | ||||||||||||
NPAs to total loans plus foreclosed assets, excluding PPP loans(1)(4) | 0.89 | % | 0.81 | % | 1.18 | % | ||||||||||||
NPAs to total loans plus foreclosed assets, excluding PCD and PPP loans(1)(4) | 0.76 | % | 0.65 | % | 0.96 | % | ||||||||||||
Performing loans classified as substandard and special mention to corporate loans: | ||||||||||||||||||
Performing loans classified as substandard and special mention to corporate loans(3) | 6.32 | % | 6.62 | % | 7.26 | % | ||||||||||||
Performing loans classified as substandard and special mention to corporate loans, excluding PPP loans(3) | 6.47 | % | 6.88 | % | 7.84 | % | ||||||||||||
(1) See the "Non-GAAP Financial Information" section presented later in this release for a discussion of this non-GAAP financial measure.
(2) Foreclosed assets consists of OREO and other foreclosed assets acquired in partial or total satisfaction of defaulted loans. Other foreclosed assets are included in other assets in the Consolidated Statements of Financial Condition.
(3) Performing loans classified as substandard and special mention excludes accruing TDRs.
(4) This ratio excludes PPP loans that are fully guaranteed by the SBA. As a result, no allowance for credit losses is associated with these loans.
NPAs represented
Performing loans classified as substandard and special mention decreased to
Charge-Off Data
(Dollar amounts in thousands)
Quarters Ended | ||||||||||||||||||||
December 31, 2021 | % of Total | September 30, 2021 | % of Total | December 31, 2020 | % of Total | |||||||||||||||
Net loan charge-offs(1) | ||||||||||||||||||||
Commercial and industrial | $ | (39 | ) | (1.9 | ) | $ | 5,002 | 59.8 | $ | 3,536 | 33.6 | |||||||||
Agricultural | 122 | 5.9 | (37 | ) | (0.4 | ) | 1,779 | 16.9 | ||||||||||||
Commercial real estate: | ||||||||||||||||||||
Office, retail, and industrial | (7 | ) | (0.3 | ) | 556 | 6.7 | 1,701 | 16.1 | ||||||||||||
Multi-family | 85 | 4.1 | 1 | — | 19 | 0.2 | ||||||||||||||
Construction | 189 | 9.1 | 986 | 11.8 | 140 | 1.3 | ||||||||||||||
Other commercial real estate | 261 | 12.5 | 829 | 9.9 | 916 | 8.7 | ||||||||||||||
Consumer | 1,469 | 70.6 | 1,023 | 12.2 | 2,448 | 23.2 | ||||||||||||||
Total NCOs | $ | 2,080 | 100.0 | $ | 8,360 | 100.0 | $ | 10,539 | 100.0 | |||||||||||
Less: NCOs on PCD loans(2) | (327 | ) | 15.7 | (1,757 | ) | 21.0 | (6,488 | ) | 61.6 | |||||||||||
Total NCOs, excluding PCD loans(2) | $ | 1,753 | $ | 6,603 | $ | 4,051 | ||||||||||||||
Total recoveries included above | $ | 2,254 | $ | 3,397 | $ | 2,588 | ||||||||||||||
Quarter-to-Date(1)(3): | ||||||||||||||||||||
Net charge-offs to average loans | 0.06 | % | 0.22 | % | 0.29 | % | ||||||||||||||
Net charge-offs to average loans, excluding PPP loans(2)(4) | 0.06 | % | 0.23 | % | 0.31 | % | ||||||||||||||
Net charge-offs to average loans, excluding PCD and PPP loans(2)(4) | 0.05 | % | 0.18 | % | 0.12 | % | ||||||||||||||
Year-to-Date(1)(3): | ||||||||||||||||||||
Net charge-offs to average loans | 0.27 | % | 0.35 | % | 0.36 | % | ||||||||||||||
Net charge-offs to average loans, excluding PPP loans(2)(4) | 0.29 | % | 0.37 | % | 0.38 | % | ||||||||||||||
Net charge-offs to average loans, excluding PCD and PPP loans(2)(4) | 0.23 | % | 0.29 | % | 0.24 | % | ||||||||||||||
(1) Amounts represent charge-offs, net of recoveries.
(2) See the "Non-GAAP Financial Information" section presented later in this release for a discussion of this non-GAAP financial measure.
(3) Annualized based on the actual number of days for each period presented.
(4) This ratio excludes PPP loans that are fully guaranteed by the SBA. As a result, no allowance for credit losses is associated with these loans.
Net loan charge-offs to average loans, annualized, were
DEPOSIT PORTFOLIO
Deposit Composition
(Dollar amounts in thousands)
Average for the Quarters Ended | December 31, 2021 Percent Change From | ||||||||||||||
December 31, 2021 | September 30, 2021 | December 31, 2020 | September 30, 2021 | December 31, 2020 | |||||||||||
Demand deposits | $ | 6,411,550 | $ | 6,272,903 | $ | 5,753,600 | 2.2 | 11.4 | |||||||
Savings deposits | 2,825,792 | 2,785,816 | 2,436,930 | 1.4 | 16.0 | ||||||||||
NOW accounts | 3,165,689 | 3,213,637 | 2,774,989 | (1.5 | ) | 14.1 | |||||||||
Money market accounts | 3,316,492 | 3,211,355 | 2,923,881 | 3.3 | 13.4 | ||||||||||
Core deposits | 15,719,523 | 15,483,711 | 13,889,400 | 1.5 | 13.2 | ||||||||||
Time deposits | 1,736,197 | 1,800,493 | 2,047,260 | (3.6 | ) | (15.2 | ) | ||||||||
Total deposits | $ | 17,455,720 | $ | 17,284,204 | $ | 15,936,660 | 1.0 | 9.5 | |||||||
Total average deposits were
CAPITAL MANAGEMENT
Capital Ratios
As of | |||||||||
December 31, 2021 | September 30, 2021 | December 31, 2020 | |||||||
Company regulatory capital ratios: | |||||||||
Total capital to risk-weighted assets | 14.47 | % | 14.26 | % | 14.14 | % | |||
Tier 1 capital to risk-weighted assets | 12.22 | % | 11.99 | % | 11.55 | % | |||
Common equity Tier 1 ("CET1") to risk-weighted assets | 10.74 | % | 10.51 | % | 10.06 | % | |||
Tier 1 capital to average assets | 8.97 | % | 8.89 | % | 8.91 | % | |||
Company tangible common equity ratios(1)(2): | |||||||||
Tangible common equity to tangible assets | 7.63 | % | 7.53 | % | 7.67 | % | |||
Tangible common equity to tangible assets, excluding PPP loans | 7.72 | % | 7.67 | % | 7.98 | % | |||
Tangible common equity, excluding accumulated other comprehensive income ("AOCI"), to tangible assets | 7.81 | % | 7.65 | % | 7.54 | % | |||
Tangible common equity, excluding AOCI, to tangible assets, excluding PPP loans | 7.90 | % | 7.79 | % | 7.85 | % | |||
Tangible common equity to risk-weighted assets | 10.24 | % | 10.08 | % | 9.93 | % | |||
(1) These ratios are not subject to formal Federal Reserve regulatory guidance.
(2) Tangible common equity ("TCE") is a non-GAAP measure that represents common stockholders' equity less goodwill and identifiable intangible assets. For details of the calculation of these ratios, see the sections titled, "Non-GAAP Financial Information" and "Non-GAAP Reconciliations" presented later in this release.
Risk-weighted regulatory capital ratios compared to all prior periods were impacted by retained earnings and the mix of risk-weighted assets. Total capital to risk-weighted assets compared to December 31, 2020 was impacted by the beginning of the five-year phase-out of Tier 2 treatment of the Company's subordinated debt. The Company elected the five-year current expected credit losses ("CECL") transition relief for regulatory capital, which retained approximately 30 basis points of CET1 and Tier 1 capital at December 31, 2021.
The Board of Directors approved a quarterly cash dividend of
Press Release and Additional Information Available on Website
This press release and the accompanying unaudited Selected Financial Information are available through the Investor Relations section of First Midwest's website at investor.firstmidwest.com.
Forward-Looking Statements
This communication may contain certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, regarding the financial condition, results of operations, business plans and future performance of First Midwest. In some cases, forward-looking statements can be identified by the use of words such as "may," "might," "will," "would," "should," "could," "expect," "plan," "intend," "anticipate," "believe," "estimate," "outlook," "forecast," "predict," "project," "probable," "potential," "possible," "target," "continue," "look forward," or "assume" and words of similar import. Because forward-looking statements relate to future results and occurrences, they are subject to inherent uncertainties, risks, and changes in circumstances that are difficult to predict. Forward-looking statements are not historical facts or guarantees of future performance but instead express only management's beliefs regarding future results or events, many of which, by their nature, are inherently uncertain and outside of management's control. It is possible that actual results and events may differ, possibly materially, from the anticipated results or events indicated in these forward-looking statements. First Midwest cautions you not to place undue reliance on these statements. Forward-looking statements speak only as of the date made, and First Midwest undertakes no obligation to update any forward-looking statements.
Forward-looking statements may be deemed to include, among other things, statements relating to First Midwest's future financial performance, the performance of First Midwest's loan or securities portfolio, the expected amount of future credit allowances or charge-offs, the timing of the pending merger of First Midwest and Old National, the failure to obtain necessary regulatory approvals or to satisfy any of the other conditions to the merger on a timely basis or at all, the possibility that the anticipated benefits of the merger are not realized when expected or at all, corporate strategies or objectives, including the impact of certain actions and initiatives, anticipated trends in First Midwest's business, regulatory developments, estimated synergies, cost savings and financial benefits of completed transactions, growth strategies, the inability to realize cost savings or improved revenues or to implement integration plans associated with the proposed merger with Old National and the continued or potential effects of the COVID-19 pandemic and related variants and mutations on First Midwest's business, financial condition, liquidity, loans, asset quality and results of operations. These statements are subject to certain risks, uncertainties and assumptions, including the duration, extent and severity of the COVID-19 pandemic and related variants and mutations, including the continued effects on First Midwest's business, operations and employees, as well as on First Midwest's customers and service providers, and on economies and markets more generally and other risks, uncertainties and assumptions that are discussed under the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in First Midwest's Annual Report on Form 10-K for the year ended December 31, 2020, and in First Midwest's subsequent filings made with the Securities and Exchange Commission ("SEC"). These risks and uncertainties are not exhaustive, and other sections of these reports describe additional factors that could adversely impact First Midwest's business and financial performance.
Non-GAAP Financial Information
The Company's accounting and reporting policies conform to U.S. generally accepted accounting principles ("GAAP") and general practices within the banking industry. As a supplement to GAAP, the Company provides non-GAAP performance results, which the Company believes are useful because they assist investors in assessing the Company's operating performance. These non-GAAP financial measures include EPS, adjusted, the efficiency ratio, return on average assets, adjusted, tax-equivalent net interest income (including its individual components), tax-equivalent net interest margin, tax-equivalent net interest margin, adjusted, noninterest expense, adjusted, tangible common equity to tangible assets, tangible common equity, excluding AOCI, to tangible assets, tangible common equity to risk-weighted assets, return on average common equity, adjusted, return on average tangible common equity, return on average tangible common equity, adjusted, non-accrual loans, excluding PCD loans, non-accrual loans to total loans, excluding PPP loans, non-accrual loans to total loans, excluding PCD and PPP loans, NPLs to total loans, excluding PPP loans, NPLs to total loans, excluding PCD and PPP loans, NPAs to total loans plus foreclosed assets, excluding PPP loans, NPAs to total loans plus foreclosed assets, excluding PCD and PPP loans, performing loans classified as substandard and special mention to corporate loans, excluding PPP loans, NCOs, excluding PCD loans, NCOs to average loans, excluding PPP loans, NCOs to average loans, excluding PCD and PPP loans, and pre-tax, pre-provision earnings, adjusted.
The Company presents EPS, the efficiency ratio, return on average assets, return on average common equity, and return on average tangible common equity, all adjusted for certain significant transactions. These transactions include acquisition and integration related expenses associated with completed and pending acquisitions (all periods), optimization costs (second and first quarters of 2021 and fourth quarter of 2020), swap termination costs (fourth quarter of 2020), income tax benefits (fourth quarter of 2020), and net securities gains (full year 2020). In addition, net OREO expense is excluded from the calculation of the efficiency ratio. Management believes excluding these transactions from EPS, the efficiency ratio, return on average assets, return on average common equity, and return on average tangible common equity may be useful in assessing the Company's underlying operational performance since these transactions do not pertain to its core business operations and their exclusion may facilitate better comparability between periods. Management believes that excluding acquisition and integration related expenses from these metrics may be useful to the Company, as well as analysts and investors, since these expenses can vary significantly based on the size, type, and structure of each acquisition. Additionally, management believes excluding these transactions from these metrics may enhance comparability for peer comparison purposes.
Income tax expense, provision for loan losses, and the certain significant transactions listed above are excluded from the calculation of pre-tax, pre-provision earnings, adjusted due to the fluctuation in income before income tax and the level of provision for loan losses required based on the estimated impact of the pandemic on the ACL. Management believes pre-tax, pre-provision earnings, adjusted may be useful in assessing the Company's underlying operational performance and their exclusion may facilitate better comparability between periods and for peer comparison purposes.
The Company presents noninterest expense, adjusted, which excludes optimization costs, and acquisition and integration related expenses. Management believes that excluding these items from noninterest expense may be useful in assessing the Company’s underlying operational performance as these items either do not pertain to its core business operations or their exclusion may facilitate better comparability between periods and for peer comparison purposes.
The tax-equivalent adjustment to net interest income and net interest margin recognizes the income tax savings when comparing taxable and tax-exempt assets. Interest income and yields on tax-exempt securities and loans are presented using the current federal income tax rate of
In management's view, tangible common equity measures are capital adequacy metrics that may be meaningful to the Company, as well as analysts and investors, in assessing the Company's use of equity and in facilitating comparisons with peers. These non-GAAP measures are valuable indicators of a financial institution's capital strength since they eliminate intangible assets from stockholders' equity and retain the effect of accumulated other comprehensive loss in stockholders' equity.
The Company presents non-accrual loans, non-accrual loans to total loans, NPLs to total loans, NPAs to total loans plus foreclosed assets, performing loans classified as substandard and special mention to corporate loans, excluding PPP loans, NCOs, and NCOs to average loans, all excluding PCD and/or PPP loans. Management believes excluding PCD and PPP loans is useful as it facilitates better comparability between periods. Prior to the adoption of CECL on January 1, 2020, PCI loans with an accretable yield were considered current and were not included in past due and non-accrual loan totals and the portion of PCI loans deemed to be uncollectible was recorded as a reduction of the credit-related acquisition adjustment, which was netted within loans. Subsequent to adoption, PCD loans, including those previously classified as PCI, are included in past due and non-accrual loan totals and an ACL on PCD loans is established as of the acquisition date and the PCD loans are no longer recorded net of a credit-related acquisition adjustment. PCD loans deemed to be uncollectible are recorded as a charge-off through the ACL. The Company began originating PPP loans during the second quarter of 2020 and the loans are fully guaranteed by the SBA and are expected to be forgiven if the applicable criteria are met. Additionally, management believes excluding PCD and PPP loans from these metrics may enhance comparability for peer comparison purposes.
Although intended to enhance investors' understanding of the Company's business and performance, these non-GAAP financial measures should not be considered an alternative to GAAP. In addition, these non-GAAP financial measures may differ from those used by other financial institutions to assess their business and performance. See the previously provided tables and the following reconciliations in the "Non-GAAP Reconciliations" section for details on the calculation of these measures to the extent presented herein.
About First Midwest
First Midwest (NASDAQ: FMBI) is a relationship-focused financial institution and one of the largest independent publicly traded bank holding companies based on assets headquartered in Chicago and the Midwest, with approximately
CONTACTS:
Investors Patrick S. Barrett EVP, Chief Financial Officer (708) 831-7231 pat.barrett@firstmidwest.com | Media Maurissa Kanter SVP, Director of Corporate Communications (708) 831-7345 maurissa.kanter@firstmidwest.com |
Accompanying Unaudited Selected Financial Information
First Midwest Bancorp, Inc. | |||||||||||||||||||
Consolidated Statements of Financial Condition (Unaudited) (Dollar amounts in thousands) | |||||||||||||||||||
As of | |||||||||||||||||||
December 31, | September 30, | June 30, | March 31, | December 31, | |||||||||||||||
2021 | 2021 | 2021 | 2021 | 2020 | |||||||||||||||
Period-End Balance Sheet | |||||||||||||||||||
Assets | |||||||||||||||||||
Cash and due from banks | $ | 220,207 | $ | 270,020 | $ | 232,989 | $ | 223,713 | $ | 196,364 | |||||||||
Interest-bearing deposits in other banks | 1,898,865 | 1,654,917 | 1,312,412 | 786,814 | 920,880 | ||||||||||||||
Equity securities, at fair value | 118,857 | 114,848 | 112,977 | 96,983 | 76,404 | ||||||||||||||
Securities available-for-sale, at fair value | 3,147,220 | 3,212,908 | 3,156,194 | 3,195,405 | 3,096,408 | ||||||||||||||
Securities held-to-maturity, at amortized cost | 8,655 | 10,853 | 11,593 | 11,711 | 12,071 | ||||||||||||||
FHLB and FRB stock | 106,097 | 106,090 | 106,890 | 106,170 | 117,420 | ||||||||||||||
Loans: | |||||||||||||||||||
Commercial and industrial | 4,834,332 | 4,705,458 | 4,608,148 | 4,546,317 | 4,578,254 | ||||||||||||||
Agricultural | 327,873 | 349,159 | 342,834 | 355,883 | 364,038 | ||||||||||||||
Commercial real estate: | |||||||||||||||||||
Office, retail, and industrial | 1,746,944 | 1,765,592 | 1,807,428 | 1,827,116 | 1,861,768 | ||||||||||||||
Multi-family | 1,120,748 | 1,082,941 | 1,012,722 | 906,124 | 872,813 | ||||||||||||||
Construction | 588,247 | 595,204 | 577,338 | 614,021 | 612,611 | ||||||||||||||
Other commercial real estate | 1,275,906 | 1,408,955 | 1,461,370 | 1,463,582 | 1,481,976 | ||||||||||||||
PPP loans | 230,687 | 384,100 | 705,915 | 1,109,442 | 785,563 | ||||||||||||||
Home equity | 565,443 | 591,126 | 629,367 | 690,030 | 761,725 | ||||||||||||||
1-4 family mortgages | 3,418,059 | 3,332,732 | 3,287,773 | 3,187,066 | 3,022,413 | ||||||||||||||
Installment | 557,252 | 573,465 | 602,324 | 483,945 | 410,071 | ||||||||||||||
Total loans | 14,665,491 | 14,788,732 | 15,035,219 | 15,183,526 | 14,751,232 | ||||||||||||||
Allowance for loan losses | (201,237 | ) | (206,241 | ) | (214,601 | ) | (235,359 | ) | (239,017 | ) | |||||||||
Net loans | 14,464,254 | 14,582,491 | 14,820,618 | 14,948,167 | 14,512,215 | ||||||||||||||
OREO | 5,196 | 5,106 | 5,289 | 6,273 | 8,253 | ||||||||||||||
Premises, furniture, and equipment, net | 120,555 | 123,413 | 125,837 | 129,514 | 132,045 | ||||||||||||||
Investment in bank-owned life insurance ("BOLI") | 300,730 | 300,387 | 300,537 | 301,365 | 301,101 | ||||||||||||||
Goodwill and other intangible assets | 920,599 | 923,383 | 926,176 | 928,974 | 932,764 | ||||||||||||||
Accrued interest receivable and other assets | 467,007 | 473,764 | 513,912 | 473,502 | 532,753 | ||||||||||||||
Total assets | $ | 21,778,242 | $ | 21,778,180 | $ | 21,625,424 | $ | 21,208,591 | $ | 20,838,678 | |||||||||
Liabilities and Stockholders' Equity | |||||||||||||||||||
Noninterest-bearing deposits | $ | 6,191,885 | $ | 6,097,698 | $ | 6,187,478 | $ | 6,156,145 | $ | 5,797,899 | |||||||||
Interest-bearing deposits | 10,999,044 | 11,100,704 | 10,845,405 | 10,455,309 | 10,214,565 | ||||||||||||||
Total deposits | 17,190,929 | 17,198,402 | 17,032,883 | 16,611,454 | 16,012,464 | ||||||||||||||
Borrowed funds | 1,291,816 | 1,274,572 | 1,299,424 | 1,295,737 | 1,546,414 | ||||||||||||||
Senior and subordinated debt | 235,588 | 235,383 | 235,178 | 234,973 | 234,768 | ||||||||||||||
Accrued interest payable and other liabilities | 317,181 | 346,600 | 353,791 | 413,112 | 355,026 | ||||||||||||||
Stockholders' equity | 2,742,728 | 2,723,223 | 2,704,148 | 2,653,315 | 2,690,006 | ||||||||||||||
Total liabilities and stockholders' equity | $ | 21,778,242 | $ | 21,778,180 | $ | 21,625,424 | $ | 21,208,591 | $ | 20,838,678 | |||||||||
Stockholders' equity, excluding AOCI | $ | 2,780,521 | $ | 2,748,604 | $ | 2,710,089 | $ | 2,675,411 | $ | 2,663,627 | |||||||||
Stockholders' equity, common | 2,512,228 | 2,492,723 | 2,473,648 | 2,422,815 | 2,459,506 | ||||||||||||||
First Midwest Bancorp, Inc. | ||||||||||||||||||||||||||||
Condensed Consolidated Statements of Income (Unaudited) (Dollar amounts in thousands) | ||||||||||||||||||||||||||||
Quarters Ended | Years Ended | |||||||||||||||||||||||||||
December 31, | September 30, | June 30, | March 31, | December 31, | December 31, | December 31, | ||||||||||||||||||||||
2021 | 2021 | 2021 | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||||
Income Statement | ||||||||||||||||||||||||||||
Interest income | $ | 148,003 | $ | 154,672 | $ | 154,000 | $ | 151,150 | $ | 159,962 | $ | 607,825 | $ | 651,318 | ||||||||||||||
Interest expense | 9,227 | 9,476 | 9,712 | 10,035 | 11,851 | 38,450 | 71,669 | |||||||||||||||||||||
Net interest income | 138,776 | 145,196 | 144,288 | 141,115 | 148,111 | 569,375 | 579,649 | |||||||||||||||||||||
Provision for loan losses | (2,924 | ) | — | — | 6,098 | 10,507 | 3,174 | 98,615 | ||||||||||||||||||||
Net interest income after provision for loan losses | 141,700 | 145,196 | 144,288 | 135,017 | 137,604 | 566,201 | 481,034 | |||||||||||||||||||||
Noninterest Income | ||||||||||||||||||||||||||||
Wealth management fees | 14,246 | 14,820 | 14,555 | 14,149 | 13,548 | 57,770 | 50,688 | |||||||||||||||||||||
Service charges on deposit accounts | 12,149 | 11,496 | 10,778 | 9,980 | 10,811 | 44,403 | 42,059 | |||||||||||||||||||||
Mortgage banking income | 6,149 | 6,664 | 6,749 | 10,187 | 9,191 | 29,749 | 21,115 | |||||||||||||||||||||
Card-based fees, net | 4,451 | 4,992 | 4,764 | 4,556 | 4,530 | 18,763 | 16,150 | |||||||||||||||||||||
Capital market products income | 1,462 | 1,333 | 1,954 | 2,089 | 659 | 6,838 | 6,961 | |||||||||||||||||||||
Other service charges, commissions, and fees | 3,775 | 2,832 | 2,823 | 2,761 | 2,993 | 12,191 | 10,576 | |||||||||||||||||||||
Total fee-based revenues | 42,232 | 42,137 | 41,623 | 43,722 | 41,732 | 169,714 | 147,549 | |||||||||||||||||||||
Other income | 2,247 | 3,043 | 4,647 | 2,081 | 3,550 | 12,018 | 11,633 | |||||||||||||||||||||
Swap termination costs | — | — | — | — | (17,567 | ) | — | (31,852 | ) | |||||||||||||||||||
Net securities gains | — | — | — | — | — | — | 13,323 | |||||||||||||||||||||
Total noninterest income | 44,479 | 45,180 | 46,270 | 45,803 | 27,715 | 181,732 | 140,653 | |||||||||||||||||||||
Noninterest Expense | ||||||||||||||||||||||||||||
Salaries and employee benefits: | ||||||||||||||||||||||||||||
Salaries and wages | 56,334 | 51,503 | 51,887 | 53,693 | 55,950 | 213,417 | 211,917 | |||||||||||||||||||||
Retirement and other employee benefits | 11,112 | 10,924 | 12,324 | 12,708 | 10,430 | 47,068 | 45,728 | |||||||||||||||||||||
Total salaries and employee benefits | 67,446 | 62,427 | 64,211 | 66,401 | 66,380 | 260,485 | 257,645 | |||||||||||||||||||||
Net occupancy and equipment expense | 13,550 | 14,198 | 13,654 | 14,752 | 14,002 | 56,154 | 57,081 | |||||||||||||||||||||
Technology and related costs | 10,468 | 10,742 | 10,453 | 10,284 | 11,005 | 41,947 | 39,822 | |||||||||||||||||||||
Professional services | 7,620 | 6,991 | 7,568 | 8,059 | 8,424 | 30,238 | 35,019 | |||||||||||||||||||||
Advertising and promotions | 2,853 | 3,168 | 2,899 | 1,835 | 1,850 | 10,755 | 10,109 | |||||||||||||||||||||
Net OREO expense | 442 | (4 | ) | 160 | 589 | 106 | 1,187 | 1,196 | ||||||||||||||||||||
Other expenses | 14,565 | 15,616 | 14,670 | 14,735 | 12,851 | 59,586 | 52,503 | |||||||||||||||||||||
Acquisition and integration related expenses | 3,945 | 2,916 | 7,773 | 245 | 1,860 | 14,879 | 13,462 | |||||||||||||||||||||
Optimization costs | — | — | 31 | 1,525 | 1,493 | 1,556 | 19,869 | |||||||||||||||||||||
Total noninterest expense | 120,889 | 116,054 | 121,419 | 118,425 | 117,971 | 476,787 | 486,706 | |||||||||||||||||||||
Income before income tax expense | 65,290 | 74,322 | 69,139 | 62,395 | 47,348 | 271,146 | 134,981 | |||||||||||||||||||||
Income tax expense | 16,737 | 19,459 | 18,018 | 17,372 | 5,743 | 71,586 | 27,083 | |||||||||||||||||||||
Net income | $ | 48,553 | $ | 54,863 | $ | 51,121 | $ | 45,023 | $ | 41,605 | $ | 199,560 | $ | 107,898 | ||||||||||||||
Preferred dividends | (4,034 | ) | (4,033 | ) | (4,034 | ) | (4,034 | ) | (4,049 | ) | (16,135 | ) | (9,119 | ) | ||||||||||||||
Net income applicable to non-vested restricted shares | (398 | ) | (517 | ) | (521 | ) | (486 | ) | (369 | ) | (1,922 | ) | (984 | ) | ||||||||||||||
Net income applicable to common shares | $ | 44,121 | $ | 50,313 | $ | 46,566 | $ | 40,503 | $ | 37,187 | $ | 181,503 | $ | 97,795 | ||||||||||||||
Net income applicable to common shares, adjusted(1) | 47,080 | 52,500 | 52,419 | 41,831 | 49,238 | 193,830 | 133,052 |
Footnotes to Condensed Consolidated Statements of Income
(1) See the "Non-GAAP Reconciliations" section for the detailed calculation.
First Midwest Bancorp, Inc. | ||||||||||||||||||||||||||||
Selected Financial Information (Unaudited) (Amounts in thousands, except per share data) | ||||||||||||||||||||||||||||
As of or for the | ||||||||||||||||||||||||||||
Quarters Ended | Years Ended | |||||||||||||||||||||||||||
December 31, | September 30, | June 30, | March 31, | December 31, | December 31, | December 31, | ||||||||||||||||||||||
2021 | 2021 | 2021 | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||||
EPS | ||||||||||||||||||||||||||||
Basic EPS | $ | 0.39 | $ | 0.45 | $ | 0.41 | $ | 0.36 | $ | 0.33 | $ | 1.61 | $ | 0.87 | ||||||||||||||
Diluted EPS | $ | 0.39 | $ | 0.44 | $ | 0.41 | $ | 0.36 | $ | 0.33 | $ | 1.60 | $ | 0.87 | ||||||||||||||
Diluted EPS, adjusted(1) | $ | 0.41 | $ | 0.46 | $ | 0.46 | $ | 0.37 | $ | 0.43 | $ | 1.70 | $ | 1.18 | ||||||||||||||
Common Stock and Related Per Common Share Data | ||||||||||||||||||||||||||||
Book value | $ | 22.01 | $ | 21.83 | $ | 21.67 | $ | 21.22 | $ | 21.52 | $ | 22.01 | $ | 21.52 | ||||||||||||||
Tangible book value | $ | 13.95 | $ | 13.75 | $ | 13.55 | $ | 13.08 | $ | 13.36 | $ | 13.95 | $ | 13.36 | ||||||||||||||
Dividends declared per share | $ | 0.14 | $ | 0.14 | $ | 0.14 | $ | 0.14 | $ | 0.14 | $ | 0.56 | $ | 0.56 | ||||||||||||||
Closing price at period end | $ | 20.48 | $ | 19.01 | $ | 19.83 | $ | 21.91 | $ | 15.92 | $ | 20.48 | $ | 15.92 | ||||||||||||||
Closing price to book value | 0.9 | 0.9 | 0.9 | 1.0 | 0.7 | 0.9 | 0.7 | |||||||||||||||||||||
Period end shares outstanding | 114,128 | 114,167 | 114,177 | 114,196 | 114,296 | 114,128 | 114,296 | |||||||||||||||||||||
Period end treasury shares | 11,259 | 11,213 | 11,199 | 11,176 | 11,071 | 11,259 | 11,071 | |||||||||||||||||||||
Common dividends | $ | 15,792 | $ | 15,974 | $ | 15,979 | $ | 15,997 | $ | 16,017 | $ | 63,742 | $ | 64,045 | ||||||||||||||
Dividend payout ratio | 35.90 | % | 31.11 | % | 34.15 | % | 38.89 | % | 42.42 | % | 34.78 | % | 64.37 | % | ||||||||||||||
Dividend payout ratio, adjusted(1) | 34.15 | % | 30.43 | % | 30.43 | % | 37.84 | % | 32.56 | % | 32.94 | % | 47.46 | % | ||||||||||||||
Key Ratios/Data | ||||||||||||||||||||||||||||
Return on average common equity(2) | 7.00 | % | 7.97 | % | 7.60 | % | 6.70 | % | 6.05 | % | 7.32 | % | 4.01 | % | ||||||||||||||
Return on average common equity, adjusted(1)(2) | 7.47 | % | 8.32 | % | 8.56 | % | 6.92 | % | 8.01 | % | 7.82 | % | 5.46 | % | ||||||||||||||
Return on average tangible common equity(1)(2) | 11.62 | % | 13.17 | % | 12.77 | % | 11.35 | % | 10.35 | % | 12.24 | % | 7.02 | % | ||||||||||||||
Return on average tangible common equity, adjusted(1)(2) | 12.36 | % | 13.72 | % | 14.31 | % | 11.71 | % | 13.53 | % | 13.03 | % | 9.36 | % | ||||||||||||||
Return on average assets(2) | 0.87 | % | 0.99 | % | 0.95 | % | 0.87 | % | 0.79 | % | 0.92 | % | 0.53 | % | ||||||||||||||
Return on average assets, adjusted(1)(2) | 0.93 | % | 1.03 | % | 1.06 | % | 0.90 | % | 1.02 | % | 0.98 | % | 0.70 | % | ||||||||||||||
Loans to deposits | 85.31 | % | 85.99 | % | 88.27 | % | 91.40 | % | 92.12 | % | 85.31 | % | 92.12 | % | ||||||||||||||
Efficiency ratio(1) | 63.22 | % | 59.12 | % | 59.24 | % | 61.77 | % | 58.90 | % | 60.81 | % | 60.84 | % | ||||||||||||||
Net interest margin(2)(3) | 2.75 | % | 2.91 | % | 2.96 | % | 3.03 | % | 3.14 | % | 2.91 | % | 3.18 | % | ||||||||||||||
Yield on average interest-earning assets(2)(3) | 2.94 | % | 3.10 | % | 3.16 | % | 3.24 | % | 3.39 | % | 3.11 | % | 3.57 | % | ||||||||||||||
Cost of funds(2)(4) | 0.19 | % | 0.20 | % | 0.21 | % | 0.23 | % | 0.26 | % | 0.21 | % | 0.41 | % | ||||||||||||||
Noninterest expense to average assets(2) | 2.18 | % | 2.10 | % | 2.26 | % | 2.30 | % | 2.25 | % | 2.21 | % | 2.38 | % | ||||||||||||||
Noninterest expense, adjusted to average assets, excluding PPP loans(1)(2) | 2.14 | % | 2.10 | % | 2.22 | % | 2.38 | % | 2.29 | % | 2.21 | % | 2.31 | % | ||||||||||||||
Effective income tax rate | 25.63 | % | 26.18 | % | 26.06 | % | 27.84 | % | 12.13 | % | 26.40 | % | 20.06 | % | ||||||||||||||
Effective income tax rate, adjusted(1) | 25.63 | % | 26.18 | % | 26.06 | % | 27.84 | % | 19.81 | % | 26.40 | % | 22.76 | % | ||||||||||||||
Capital Ratios | ||||||||||||||||||||||||||||
Total capital to risk-weighted assets(1) | 14.47 | % | 14.26 | % | 14.19 | % | 14.26 | % | 14.14 | % | 14.47 | % | 14.14 | % | ||||||||||||||
Tier 1 capital to risk-weighted assets(1) | 12.22 | % | 11.99 | % | 11.71 | % | 11.67 | % | 11.55 | % | 12.22 | % | 11.55 | % | ||||||||||||||
CET1 to risk-weighted assets(1) | 10.74 | % | 10.51 | % | 10.23 | % | 10.17 | % | 10.06 | % | 10.74 | % | 10.06 | % | ||||||||||||||
Tier 1 capital to average assets(1) | 8.97 | % | 8.89 | % | 8.85 | % | 8.96 | % | 8.91 | % | 8.97 | % | 8.91 | % | ||||||||||||||
Tangible common equity to tangible assets(1) | 7.63 | % | 7.53 | % | 7.48 | % | 7.37 | % | 7.67 | % | 7.63 | % | 7.67 | % | ||||||||||||||
Tangible common equity, excluding AOCI, to tangible assets(1) | 7.81 | % | 7.65 | % | 7.50 | % | 7.48 | % | 7.54 | % | 7.81 | % | 7.54 | % | ||||||||||||||
Tangible common equity to risk-weighted assets(1) | 10.24 | % | 10.08 | % | 9.92 | % | 9.73 | % | 9.93 | % | 10.24 | % | 9.93 | % | ||||||||||||||
Note: Selected Financial Information footnotes are located at the end of this section. | ||||||||||||||||||||||||||||
First Midwest Bancorp, Inc. | ||||||||||||||||||||||||||||
Selected Financial Information (Unaudited) (Amounts in thousands, except per share data) | ||||||||||||||||||||||||||||
As of or for the | ||||||||||||||||||||||||||||
Quarters Ended | Years Ended | |||||||||||||||||||||||||||
December 31, | September 30, | June 30, | March 31, | December 31, | December 31, | December 31, | ||||||||||||||||||||||
2021 | 2021 | 2021 | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||||
Asset quality Performance Data | ||||||||||||||||||||||||||||
Non-performing assets | ||||||||||||||||||||||||||||
Commercial and industrial | $ | 11,096 | $ | 9,952 | $ | 42,036 | $ | 59,723 | $ | 38,314 | $ | 11,096 | $ | 38,314 | ||||||||||||||
Agricultural | 6,410 | 6,682 | 7,135 | 8,684 | 10,719 | 6,410 | 10,719 | |||||||||||||||||||||
Commercial real estate: | ||||||||||||||||||||||||||||
Office, retail, and industrial | 23,756 | 13,450 | 17,367 | 23,339 | 27,382 | 23,756 | 27,382 | |||||||||||||||||||||
Multi-family | 12,751 | 2,672 | 2,622 | 3,701 | 1,670 | 12,751 | 1,670 | |||||||||||||||||||||
Construction | 1,104 | 1,154 | 1,154 | 1,154 | 1,155 | 1,104 | 1,155 | |||||||||||||||||||||
Other commercial real estate | 11,629 | 13,083 | 14,200 | 15,406 | 15,219 | 11,629 | 15,219 | |||||||||||||||||||||
Consumer | 14,174 | 17,173 | 16,867 | 16,643 | 15,498 | 14,174 | 15,498 | |||||||||||||||||||||
Non-accrual, excluding PCD loans | 80,920 | 64,166 | 101,381 | 128,650 | 109,957 | 80,920 | 109,957 | |||||||||||||||||||||
Non-accrual PCD loans | 21,059 | 23,917 | 23,101 | 29,734 | 32,568 | 21,059 | 32,568 | |||||||||||||||||||||
Total non-accrual loans | 101,979 | 88,083 | 124,482 | 158,384 | 142,525 | 101,979 | 142,525 | |||||||||||||||||||||
90 days or more past due loans, still accruing interest | 927 | 1,293 | 878 | 5,354 | 4,395 | 927 | 4,395 | |||||||||||||||||||||
Total NPLs | 102,906 | 89,376 | 125,360 | 163,738 | 146,920 | 102,906 | 146,920 | |||||||||||||||||||||
Accruing TDRs | 534 | 539 | 782 | 798 | 813 | 534 | 813 | |||||||||||||||||||||
Foreclosed assets(5) | 25,837 | 26,375 | 26,732 | 13,228 | 16,671 | 25,837 | 16,671 | |||||||||||||||||||||
Total NPAs | $ | 129,277 | $ | 116,290 | $ | 152,874 | $ | 177,764 | $ | 164,404 | $ | 129,277 | $ | 164,404 | ||||||||||||||
30-89 days past due loans | $ | 34,430 | $ | 30,718 | $ | 21,051 | $ | 30,973 | $ | 40,656 | $ | 34,430 | $ | 40,656 | ||||||||||||||
Allowance for credit losses | ||||||||||||||||||||||||||||
Allowance for loan losses | $ | 201,237 | $ | 206,241 | $ | 214,601 | $ | 235,359 | $ | 239,017 | $ | 201,237 | $ | 239,017 | ||||||||||||||
Reserve for unfunded commitments | 8,625 | 8,625 | 8,625 | 8,025 | 8,025 | 8,625 | 8,025 | |||||||||||||||||||||
Total ACL | $ | 209,862 | $ | 214,866 | $ | 223,226 | $ | 243,384 | $ | 247,042 | $ | 209,862 | $ | 247,042 | ||||||||||||||
Provision for loan losses | $ | (2,924 | ) | $ | — | $ | — | $ | 6,098 | $ | 10,507 | $ | 3,174 | $ | 98,615 | |||||||||||||
Net charge-offs by category | ||||||||||||||||||||||||||||
Commercial and industrial | $ | (39 | ) | $ | 5,002 | $ | 14,733 | $ | 1,740 | $ | 3,536 | $ | 21,436 | $ | 18,421 | |||||||||||||
Agricultural | 122 | (37 | ) | — | 363 | 1,779 | 448 | 3,389 | ||||||||||||||||||||
Commercial real estate: | ||||||||||||||||||||||||||||
Office, retail, and industrial | (7 | ) | 556 | 3,878 | 4,377 | 1,701 | 8,804 | 6,455 | ||||||||||||||||||||
Multi-family | 85 | 1 | 2 | (5 | ) | 19 | 83 | 33 | ||||||||||||||||||||
Construction | 189 | 986 | 208 | — | 140 | 1,383 | 7,635 | |||||||||||||||||||||
Other commercial real estate | 261 | 829 | 459 | 371 | 916 | 1,920 | 2,852 | |||||||||||||||||||||
Consumer | 1,469 | 1,023 | 1,478 | 2,910 | 2,448 | 6,880 | 12,534 | |||||||||||||||||||||
Total NCOs | $ | 2,080 | $ | 8,360 | $ | 20,758 | $ | 9,756 | $ | 10,539 | $ | 40,954 | $ | 51,319 | ||||||||||||||
Less: NCOs on PCD loans | (327 | ) | (1,757 | ) | (4,337 | ) | (2,107 | ) | (6,488 | ) | (8,528 | ) | (18,964 | ) | ||||||||||||||
Total NCOs, excluding PCD loans | $ | 1,753 | $ | 6,603 | $ | 16,421 | $ | 7,649 | $ | 4,051 | $ | 32,426 | $ | 32,355 | ||||||||||||||
Total recoveries included above | $ | 2,254 | $ | 3,397 | $ | 2,869 | $ | 1,561 | $ | 2,588 | $ | 10,081 | $ | 7,510 | ||||||||||||||
Note: Selected Financial Information footnotes are located at the end of this section. | ||||||||||||||||||||||||||||
First Midwest Bancorp, Inc. | ||||||||||||||||||||||||||||
Selected Financial Information (Unaudited) | ||||||||||||||||||||||||||||
As of or for the | ||||||||||||||||||||||||||||
Quarters Ended | Years Ended | |||||||||||||||||||||||||||
December 31, | September 30, | June 30, | March 31, | December 31, | December 31, | December 31, | ||||||||||||||||||||||
2021 | 2021 | 2021 | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||||
Performing loans classified as substandard and special mention | ||||||||||||||||||||||||||||
Special mention loans(7) | $ | 314,772 | $ | 330,218 | $ | 343,547 | $ | 355,563 | $ | 409,083 | $ | 314,772 | $ | 409,083 | ||||||||||||||
Substandard loans(7) | 325,520 | 351,192 | 325,727 | 342,600 | 357,219 | 325,520 | 357,219 | |||||||||||||||||||||
Total performing loans classified as substandard and special mention(7) | $ | 640,292 | $ | 681,410 | $ | 669,274 | $ | 698,163 | $ | 766,302 | $ | 640,292 | $ | 766,302 | ||||||||||||||
Asset quality ratios | ||||||||||||||||||||||||||||
Non-accrual loans to total loans | 0.70 | % | 0.60 | % | 0.83 | % | 1.04 | % | 0.97 | % | 0.70 | % | 0.97 | % | ||||||||||||||
Non-accrual loans to total loans, excluding PPP loans(6) | 0.71 | % | 0.61 | % | 0.87 | % | 1.13 | % | 1.02 | % | 0.71 | % | 1.02 | % | ||||||||||||||
Non-accrual loans to total loans, excluding PCD and PPP loans(6) | 0.57 | % | 0.45 | % | 0.72 | % | 0.93 | % | 0.80 | % | 0.57 | % | 0.80 | % | ||||||||||||||
NPLs to total loans | 0.70 | % | 0.60 | % | 0.83 | % | 1.08 | % | 1.00 | % | 0.70 | % | 1.00 | % | ||||||||||||||
NPLs to total loans, excluding PPP loans(6) | 0.71 | % | 0.62 | % | 0.87 | % | 1.16 | % | 1.05 | % | 0.71 | % | 1.05 | % | ||||||||||||||
NPLs to total loans, excluding PCD and PPP loans(6) | 0.57 | % | 0.46 | % | 0.72 | % | 0.97 | % | 0.83 | % | 0.57 | % | 0.83 | % | ||||||||||||||
NPAs to total loans plus foreclosed assets | 0.88 | % | 0.78 | % | 1.01 | % | 1.17 | % | 1.11 | % | 0.88 | % | 1.11 | % | ||||||||||||||
NPAs to total loans plus foreclosed assets, excluding PPP loans(6) | 0.89 | % | 0.81 | % | 1.06 | % | 1.26 | % | 1.18 | % | 0.89 | % | 1.18 | % | ||||||||||||||
NPAs to total loans plus foreclosed assets, excluding PCD and PPP loans(6) | 0.76 | % | 0.65 | % | 0.92 | % | 1.07 | % | 0.96 | % | 0.76 | % | 0.96 | % | ||||||||||||||
NPAs to tangible common equity plus ACL | 7.18 | % | 6.52 | % | 8.63 | % | 10.23 | % | 9.27 | % | 7.18 | % | 9.27 | % | ||||||||||||||
Non-accrual loans to total assets | 0.47 | % | 0.40 | % | 0.58 | % | 0.75 | % | 0.68 | % | 0.47 | % | 0.68 | % | ||||||||||||||
Performing loans classified as substandard and special mention to corporate loans(7) | 6.32 | % | 6.62 | % | 6.36 | % | 6.45 | % | 7.26 | % | 6.32 | % | 7.26 | % | ||||||||||||||
Performing loans classified as substandard and special mention to corporate loans, excluding PPP loans(6)(7) | 6.47 | % | 6.88 | % | 6.82 | % | 7.19 | % | 7.84 | % | 6.47 | % | 7.84 | % | ||||||||||||||
Allowance for credit losses and net charge-off ratios | ||||||||||||||||||||||||||||
ACL to total loans(7) | 1.43 | % | 1.45 | % | 1.48 | % | 1.60 | % | 1.67 | % | 1.43 | % | 1.67 | % | ||||||||||||||
ACL to non-accrual loans | 205.79 | % | 243.94 | % | 179.32 | % | 153.67 | % | 173.33 | % | 205.79 | % | 173.33 | % | ||||||||||||||
ACL to NPLs | 203.94 | % | 240.41 | % | 178.07 | % | 148.64 | % | 168.15 | % | 203.94 | % | 168.15 | % | ||||||||||||||
NCOs to average loans(2) | 0.06 | % | 0.22 | % | 0.55 | % | 0.26 | % | 0.29 | % | 0.27 | % | 0.36 | % | ||||||||||||||
NCOs to average loans, excluding PPP loans(2)(6) | 0.06 | % | 0.23 | % | 0.59 | % | 0.28 | % | 0.31 | % | 0.29 | % | 0.38 | % | ||||||||||||||
NCOs to average loans, excluding PCD and PPP loans(2)(6) | 0.05 | % | 0.18 | % | 0.47 | % | 0.22 | % | 0.12 | % | 0.23 | % | 0.24 | % |
Footnotes to Selected Financial Information
(1) See the "Non-GAAP Reconciliations" section for the detailed calculation.
(2) Annualized based on the actual number of days for each period presented.
(3) Presented on a tax-equivalent basis, assuming the applicable federal income tax rate of
(4) Cost of funds expresses total interest expense as a percentage of total average funding sources.
(5) Foreclosed assets consists of OREO and other foreclosed assets acquired in partial or total satisfaction of defaulted loans. Other foreclosed assets are included in other assets in the Consolidated Statements of Financial Condition.
(6) This ratio excludes PPP loans that are fully guaranteed by the SBA. As a result, no allowance for credit losses is associated with these loans.
(7) Performing loans classified as substandard and special mention excludes accruing TDRs.
First Midwest Bancorp, Inc. | ||||||||||||||||||||||||||||
Non-GAAP Reconciliations (Unaudited) (Amounts in thousands, except per share data) | ||||||||||||||||||||||||||||
Quarters Ended | Years Ended | |||||||||||||||||||||||||||
December 31, | September 30, | June 30, | March 31, | December 31, | December 31, | December 31, | ||||||||||||||||||||||
2021 | 2021 | 2021 | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||||
EPS | ||||||||||||||||||||||||||||
Net income | $ | 48,553 | $ | 54,863 | $ | 51,121 | $ | 45,023 | $ | 41,605 | $ | 199,560 | $ | 107,898 | ||||||||||||||
Dividends and accretion on preferred stock | (4,034 | ) | (4,033 | ) | (4,034 | ) | (4,034 | ) | (4,049 | ) | (16,135 | ) | (9,119 | ) | ||||||||||||||
Net income applicable to non-vested restricted shares | (398 | ) | (517 | ) | (521 | ) | (486 | ) | (369 | ) | (1,922 | ) | (984 | ) | ||||||||||||||
Net income applicable to common shares | 44,121 | 50,313 | 46,566 | 40,503 | 37,187 | 181,503 | 97,795 | |||||||||||||||||||||
Adjustments to net income: | ||||||||||||||||||||||||||||
Acquisition and integration related expenses | 3,945 | 2,916 | 7,773 | 245 | 1,860 | 14,879 | 13,462 | |||||||||||||||||||||
Tax effect of acquisition and integration related expenses | (986 | ) | (729 | ) | (1,943 | ) | (61 | ) | (465 | ) | (3,719 | ) | (3,365 | ) | ||||||||||||||
Optimization costs | — | — | 31 | 1,525 | 1,493 | 1,556 | 19,869 | |||||||||||||||||||||
Tax effect of optimization costs | — | — | (8 | ) | (381 | ) | (373 | ) | (389 | ) | (4,967 | ) | ||||||||||||||||
Swap termination costs | — | — | — | — | 17,567 | — | 31,852 | |||||||||||||||||||||
Tax effect of swap termination costs | — | — | — | — | (4,392 | ) | — | (7,963 | ) | |||||||||||||||||||
Income tax benefits | — | — | — | — | (3,639 | ) | — | (3,639 | ) | |||||||||||||||||||
Net securities gains | — | — | — | — | — | — | (13,323 | ) | ||||||||||||||||||||
Tax effect of net securities gains | — | — | — | — | — | — | 3,331 | |||||||||||||||||||||
Total adjustments to net income, net of tax | 2,959 | 2,187 | 5,853 | 1,328 | 12,051 | 12,327 | 35,257 | |||||||||||||||||||||
Net income applicable to common shares, adjusted(1) | $ | 47,080 | $ | 52,500 | $ | 52,419 | $ | 41,831 | $ | 49,238 | $ | 193,830 | $ | 133,052 | ||||||||||||||
Weighted-average common shares outstanding: | ||||||||||||||||||||||||||||
Weighted-average common shares outstanding (basic) | 112,930 | 112,898 | 112,865 | 113,098 | 113,174 | 112,947 | 112,355 | |||||||||||||||||||||
Dilutive effect of common stock equivalents | 995 | 878 | 775 | 773 | 430 | 834 | 347 | |||||||||||||||||||||
Weighted-average diluted common shares outstanding | 113,925 | 113,776 | 113,640 | 113,871 | 113,604 | 113,781 | 112,702 | |||||||||||||||||||||
Basic EPS | $ | 0.39 | $ | 0.45 | $ | 0.41 | $ | 0.36 | $ | 0.33 | $ | 1.61 | $ | 0.87 | ||||||||||||||
Diluted EPS | $ | 0.39 | $ | 0.44 | $ | 0.41 | $ | 0.36 | $ | 0.33 | $ | 1.60 | $ | 0.87 | ||||||||||||||
Diluted EPS, adjusted(1) | $ | 0.41 | $ | 0.46 | $ | 0.46 | $ | 0.37 | $ | 0.43 | $ | 1.70 | $ | 1.18 | ||||||||||||||
Anti-dilutive shares not included in the computation of diluted EPS | — | — | — | — | — | — | — | |||||||||||||||||||||
Dividend Payout Ratio | ||||||||||||||||||||||||||||
Dividends declared per share | $ | 0.14 | $ | 0.14 | $ | 0.14 | $ | 0.14 | $ | 0.14 | $ | 0.56 | $ | 0.56 | ||||||||||||||
Dividend payout ratio | 35.90 | % | 31.11 | % | 34.15 | % | 38.89 | % | 42.42 | % | 34.78 | % | 64.37 | % | ||||||||||||||
Dividend payout ratio, adjusted(1) | 34.15 | % | 30.43 | % | 30.43 | % | 37.84 | % | 32.56 | % | 32.94 | % | 47.46 | % | ||||||||||||||
Note: Non-GAAP Reconciliations footnotes are located at the end of this section. | ||||||||||||||||||||||||||||
First Midwest Bancorp, Inc. | ||||||||||||||||||||||||||||
Non-GAAP Reconciliations (Unaudited) (Amounts in thousands, except per share data) | ||||||||||||||||||||||||||||
As of or for the | ||||||||||||||||||||||||||||
Quarters Ended | Years Ended | |||||||||||||||||||||||||||
December 31, | September 30, | June 30, | March 31, | December 31, | December 31, | December 31, | ||||||||||||||||||||||
2021 | 2021 | 2021 | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||||
Return on Average Common and Tangible Common Equity | ||||||||||||||||||||||||||||
Net income applicable to common shares | $ | 44,121 | $ | 50,313 | $ | 46,566 | $ | 40,503 | $ | 37,187 | $ | 181,503 | $ | 97,795 | ||||||||||||||
Intangibles amortization | 2,784 | 2,793 | 2,798 | 2,807 | 2,807 | 11,182 | 11,207 | |||||||||||||||||||||
Tax effect of intangibles amortization | (696 | ) | (698 | ) | (700 | ) | (702 | ) | (702 | ) | (2,796 | ) | (2,803 | ) | ||||||||||||||
Net income applicable to common shares, excluding intangibles amortization | 46,209 | 52,408 | 48,664 | 42,608 | 39,292 | 189,889 | 106,199 | |||||||||||||||||||||
Total adjustments to net income, net of tax(1) | 2,959 | 2,187 | 5,853 | 1,328 | 12,051 | 12,327 | 35,257 | |||||||||||||||||||||
Net income applicable to common shares, adjusted(1) | $ | 49,168 | $ | 54,595 | $ | 54,517 | $ | 43,936 | $ | 51,343 | $ | 202,216 | $ | 141,456 | ||||||||||||||
Average stockholders' common equity | $ | 2,499,651 | $ | 2,503,028 | $ | 2,456,034 | $ | 2,453,253 | $ | 2,444,911 | $ | 2,478,187 | $ | 2,437,011 | ||||||||||||||
Less: average intangible assets | (921,937 | ) | (924,743 | ) | (927,522 | ) | (931,322 | ) | (934,347 | ) | (926,351 | ) | (923,741 | ) | ||||||||||||||
Average tangible common equity | $ | 1,577,714 | $ | 1,578,285 | $ | 1,528,512 | $ | 1,521,931 | $ | 1,510,564 | $ | 1,551,836 | $ | 1,513,270 | ||||||||||||||
Return on average common equity(2) | 7.00 | % | 7.97 | % | 7.60 | % | 6.70 | % | 6.05 | % | 7.32 | % | 4.01 | % | ||||||||||||||
Return on average common equity, adjusted(1)(2) | 7.47 | % | 8.32 | % | 8.56 | % | 6.92 | % | 8.01 | % | 7.82 | % | 5.46 | % | ||||||||||||||
Return on average tangible common equity(2) | 11.62 | % | 13.17 | % | 12.77 | % | 11.35 | % | 10.35 | % | 12.24 | % | 7.02 | % | ||||||||||||||
Return on average tangible common equity, adjusted(1)(2) | 12.36 | % | 13.72 | % | 14.31 | % | 11.71 | % | 13.53 | % | 13.03 | % | 9.36 | % | ||||||||||||||
Return on Average Assets | ||||||||||||||||||||||||||||
Net income | $ | 48,553 | $ | 54,863 | $ | 51,121 | $ | 45,023 | $ | 41,605 | $ | 199,560 | $ | 107,898 | ||||||||||||||
Total adjustments to net income, net of tax(1) | 2,959 | 2,187 | 5,853 | 1,328 | 12,051 | 12,327 | 35,257 | |||||||||||||||||||||
Net income, adjusted(1) | $ | 51,512 | $ | 57,050 | $ | 56,974 | $ | 46,351 | $ | 53,656 | $ | 211,887 | $ | 143,155 | ||||||||||||||
Average assets | $ | 22,046,672 | $ | 21,899,560 | $ | 21,533,209 | $ | 20,919,040 | $ | 20,882,325 | $ | 21,603,531 | $ | 20,424,771 | ||||||||||||||
Return on average assets(2) | 0.87 | % | 0.99 | % | 0.95 | % | 0.87 | % | 0.79 | % | 0.92 | % | 0.53 | % | ||||||||||||||
Return on average assets, adjusted(1)(2) | 0.93 | % | 1.03 | % | 1.06 | % | 0.90 | % | 1.02 | % | 0.98 | % | 0.70 | % | ||||||||||||||
Noninterest Expense to Average Assets | ||||||||||||||||||||||||||||
Noninterest expense | $ | 120,889 | $ | 116,054 | $ | 121,419 | $ | 118,425 | $ | 117,971 | $ | 476,787 | $ | 486,706 | ||||||||||||||
Less: | ||||||||||||||||||||||||||||
Acquisition and integration related expenses | (3,945 | ) | (2,916 | ) | (7,773 | ) | (245 | ) | (1,860 | ) | (14,879 | ) | (13,462 | ) | ||||||||||||||
Optimization costs | — | — | (31 | ) | (1,525 | ) | (1,493 | ) | (1,556 | ) | (19,869 | ) | ||||||||||||||||
Total | $ | 116,944 | $ | 113,138 | $ | 113,615 | $ | 116,655 | $ | 114,618 | $ | 460,352 | $ | 453,375 | ||||||||||||||
Average assets | $ | 22,046,672 | $ | 21,899,560 | $ | 21,533,209 | $ | 20,919,040 | $ | 20,882,325 | $ | 21,603,531 | $ | 20,424,771 | ||||||||||||||
Less: average PPP loans | (317,553 | ) | (549,380 | ) | (1,035,386 | ) | (1,014,798 | ) | (1,013,511 | ) | (726,876 | ) | (775,883 | ) | ||||||||||||||
Average assets, excluding PPP loans | $ | 21,729,119 | $ | 21,350,180 | $ | 20,497,823 | $ | 19,904,242 | $ | 19,868,814 | $ | 20,876,655 | $ | 19,648,888 | ||||||||||||||
Noninterest expense to average assets(2) | 2.18 | % | 2.10 | % | 2.26 | % | 2.30 | % | 2.25 | % | 2.21 | % | 2.38 | % | ||||||||||||||
Noninterest expense, adjusted to average assets, excluding PPP loans(2) | 2.14 | % | 2.10 | % | 2.22 | % | 2.38 | % | 2.29 | % | 2.21 | % | 2.31 | % | ||||||||||||||
Note: Non-GAAP Reconciliations footnotes are located at the end of this section. | ||||||||||||||||||||||||||||
First Midwest Bancorp, Inc. | ||||||||||||||||||||||||||||
Non-GAAP Reconciliations (Unaudited) (Amounts in thousands, except per share data) | ||||||||||||||||||||||||||||
As of or for the | ||||||||||||||||||||||||||||
Quarters Ended | Years Ended | |||||||||||||||||||||||||||
December 31, | September 30, | June 30, | March 31, | December 31, | December 31, | December 31, | ||||||||||||||||||||||
2021 | 2021 | 2021 | 2021 | 2020 | 2021 | 2020 | ||||||||||||||||||||||
Efficiency Ratio Calculation | ||||||||||||||||||||||||||||
Noninterest expense | $ | 120,889 | $ | 116,054 | $ | 121,419 | $ | 118,425 | $ | 117,971 | $ | 476,787 | $ | 486,706 | ||||||||||||||
Less: | ||||||||||||||||||||||||||||
Acquisition and integration related expenses | (3,945 | ) | (2,916 | ) | (7,773 | ) | (245 | ) | (1,860 | ) | (14,879 | ) | (13,462 | ) | ||||||||||||||
Net OREO expense | (442 | ) | 4 | (160 | ) | (589 | ) | (106 | ) | (1,187 | ) | (1,196 | ) | |||||||||||||||
Optimization costs | — | — | (31 | ) | (1,525 | ) | (1,493 | ) | (1,556 | ) | (19,869 | ) | ||||||||||||||||
Total | $ | 116,502 | $ | 113,142 | $ | 113,455 | $ | 116,066 | $ | 114,512 | $ | 459,165 | $ | 452,179 | ||||||||||||||
Tax-equivalent net interest income(3) | $ | 139,811 | $ | 146,190 | $ | 145,241 | $ | 142,098 | $ | 149,141 | $ | 573,340 | $ | 584,079 | ||||||||||||||
Noninterest income | 44,479 | 45,180 | 46,270 | 45,803 | 27,715 | 181,732 | 140,653 | |||||||||||||||||||||
Less: | ||||||||||||||||||||||||||||
Swap termination costs | — | — | — | — | 17,567 | — | 31,852 | |||||||||||||||||||||
Net securities gains | — | — | — | — | — | — | (13,323 | ) | ||||||||||||||||||||
Total | $ | 184,290 | $ | 191,370 | $ | 191,511 | $ | 187,901 | $ | 194,423 | $ | 755,072 | $ | 743,261 | ||||||||||||||
Efficiency ratio | 63.22 | % | 59.12 | % | 59.24 | % | 61.77 | % | 58.90 | % | 60.81 | % | 60.84 | % | ||||||||||||||
Pre-Tax, Pre-Provision Earnings | ||||||||||||||||||||||||||||
Net Income | $ | 48,553 | $ | 54,863 | $ | 51,121 | $ | 45,023 | $ | 41,605 | $ | 199,560 | $ | 107,898 | ||||||||||||||
Income tax expense | 16,737 | 19,459 | 18,018 | 17,372 | 5,743 | 71,586 | 27,083 | |||||||||||||||||||||
Provision for credit losses | (2,924 | ) | — | — | 6,098 | 10,507 | 3,174 | 98,615 | ||||||||||||||||||||
Pre-Tax, Pre-Provision Earnings | $ | 62,366 | $ | 74,322 | $ | 69,139 | $ | 68,493 | $ | 57,855 | $ | 274,320 | $ | 233,596 | ||||||||||||||
Adjustments to pre-tax, pre-provision earnings: | ||||||||||||||||||||||||||||
Acquisition and integration related expenses | $ | 3,945 | $ | 2,916 | $ | 7,773 | $ | 245 | $ | 1,860 | $ | 14,879 | $ | 13,462 | ||||||||||||||
Optimization costs | — | — | 31 | 1,525 | 1,493 | 1,556 | 19,869 | |||||||||||||||||||||
Swap termination costs | — | — | — | — | 17,567 | — | 31,852 | |||||||||||||||||||||
Net securities gains | — | — | — | — | — | — | (13,323 | ) | ||||||||||||||||||||
Total adjustments | 3,945 | 2,916 | 7,804 | 1,770 | 20,920 | 16,435 | 51,860 | |||||||||||||||||||||
Pre-Tax, Pre-Provision Earnings, adjusted | $ | 66,311 | $ | 77,238 | $ | 76,943 | $ | 70,263 | $ | 78,775 | $ | 290,755 | $ | 285,456 | ||||||||||||||
Note: Non-GAAP Reconciliations footnotes are located at the end of this section. | ||||||||||||||||||||||||||||
First Midwest Bancorp, Inc. | ||||||||||||||||||||
Non-GAAP Reconciliations (Unaudited) (Amounts in thousands, except per share data) | ||||||||||||||||||||
As of or for the | ||||||||||||||||||||
Quarters Ended | ||||||||||||||||||||
December 31, | September 30, | June 30, | March 31, | December 31, | ||||||||||||||||
2021 | 2021 | 2021 | 2021 | 2020 | ||||||||||||||||
Tangible Common Equity | ||||||||||||||||||||
Stockholders' equity, common | $ | 2,512,228 | $ | 2,492,723 | $ | 2,473,648 | $ | 2,422,815 | $ | 2,459,506 | ||||||||||
Less: goodwill and other intangible assets | (920,599 | ) | (923,383 | ) | (926,176 | ) | (928,974 | ) | (932,764 | ) | ||||||||||
Tangible common equity | 1,591,629 | 1,569,340 | 1,547,472 | 1,493,841 | 1,526,742 | |||||||||||||||
Less: AOCI | 37,793 | 25,381 | 5,941 | 22,096 | (26,379 | ) | ||||||||||||||
Tangible common equity, excluding AOCI | $ | 1,629,422 | $ | 1,594,721 | $ | 1,553,413 | $ | 1,515,937 | $ | 1,500,363 | ||||||||||
Total assets | $ | 21,778,242 | $ | 21,778,180 | $ | 21,625,424 | $ | 21,208,591 | $ | 20,838,678 | ||||||||||
Less: goodwill and other intangible assets | (920,599 | ) | (923,383 | ) | (926,176 | ) | (928,974 | ) | (932,764 | ) | ||||||||||
Tangible assets | 20,857,643 | 20,854,797 | 20,699,248 | 20,279,617 | 19,905,914 | |||||||||||||||
Less: PPP loans | (230,687 | ) | (384,100 | ) | (705,915 | ) | (1,109,442 | ) | (785,563 | ) | ||||||||||
Tangible assets, excluding PPP loans | $ | 20,626,956 | $ | 20,470,697 | $ | 19,993,333 | $ | 19,170,175 | $ | 19,120,351 | ||||||||||
Tangible common equity to tangible assets | 7.63 | % | 7.53 | % | 7.48 | % | 7.37 | % | 7.67 | % | ||||||||||
Tangible common equity to tangible assets, excluding PPP loans | 7.72 | % | 7.67 | % | 7.74 | % | 7.79 | % | 7.98 | % | ||||||||||
Tangible common equity, excluding AOCI, to tangible assets | 7.81 | % | 7.65 | % | 7.50 | % | 7.48 | % | 7.54 | % | ||||||||||
Tangible common equity, excluding AOCI, to tangible assets, excluding PPP loans | 7.90 | % | 7.79 | % | 7.77 | % | 7.91 | % | 7.85 | % | ||||||||||
Tangible common equity to risk-weighted assets | 10.24 | % | 10.08 | % | 9.92 | % | 9.73 | % | 9.93 | % | ||||||||||
Footnotes to Non-GAAP Reconciliations
(1) Adjustments to net income for each period presented are detailed in the EPS non-GAAP reconciliation above. For additional discussion of adjustments, see the "Non-GAAP Financial Information" section.
(2) Annualized based on the actual number of days for each period presented.
(3) Presented on a tax-equivalent basis, assuming the applicable federal income tax rate of
FAQ
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