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Heartland Financial USA, Inc. ("HTLF") Reports Quarterly Results as of June 30, 2024

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Heartland Financial USA (NASDAQ: HTLF) announced its Q2 2024 results with a net income of $37.7M, or $0.88 per share, and adjusted earnings of $49.6M, or $1.15 per share. The report highlights $6.0M in acquisition costs and a $10.6M pre-tax loss from selling $108.4M in CRE securities to improve risk and liquidity.

The common equity ratio increased to 10.19%, and the tangible common equity ratio rose to 7.28%. The net interest margin improved to 3.73% from 3.57% in Q1, with an annual loan yield increase to 6.76% and deposit costs down to 2.08%. The sale of all Rocky Mountain Bank branches, expected to yield a $30M gain, closed in mid-July.

Compared to Q2 2023, net income fell by $9.7M, and EPS dropped by $0.23. However, adjusted earnings rose to $49.6M from $46.5M. Net interest income climbed to $158.7M, up by $11.6M. Notably, noninterest income fell by $14.3M due to increased security losses and decreased service charges. Noninterest expenses rose by $6.8M.

Heartland Financial USA (NASDAQ: HTLF) ha annunciato i risultati del secondo trimestre 2024, registrando un utile netto di $37,7 milioni, ovvero $0,88 per azione, e un utile rettificato di $49,6 milioni, ovvero $1,15 per azione. Il report evidenzia $6,0 milioni in costi di acquisizione e una perdita ante imposte di $10,6 milioni dalla vendita di $108,4 milioni in titoli CRE, per migliorare il rischio e la liquidità.

Il rapporto di capitale comune è aumentato al 10,19%, e il rapporto di capitale tangibile comune è salito al 7,28%. Il margine di interesse netto è migliorato al 3,73% rispetto al 3,57% del primo trimestre, con un aumento del rendimento sui prestiti annui al 6,76% e una diminuzione dei costi sui depositi al 2,08%. La vendita di tutte le filiali di Rocky Mountain Bank, che si prevede genererà un guadagno di $30 milioni, è stata completata a metà luglio.

Rispetto al secondo trimestre 2023, l'utile netto è diminuito di $9,7 milioni e l'EPS è sceso di $0,23. Tuttavia, gli utili rettificati sono aumentati a $49,6 milioni rispetto ai $46,5 milioni precedenti. L'utile netto da interessi è salito a $158,7 milioni, con un incremento di $11,6 milioni. In particolare, l'utile non da interessi è diminuito di $14,3 milioni a causa dell'aumento delle perdite sui titoli e della diminuzione delle commissioni di servizio. Le spese non da interessi sono aumentate di $6,8 milioni.

Heartland Financial USA (NASDAQ: HTLF) anunció sus resultados del segundo trimestre de 2024, con un ingreso neto de $37,7 millones, o $0,88 por acción, y unas ganancias ajustadas de $49,6 millones, o $1,15 por acción. El informe destaca costos de adquisición de $6,0 millones y una pérdida antes de impuestos de $10,6 millones por la venta de $108,4 millones en valores CRE para mejorar el riesgo y la liquidez.

El ratio de capital común aumentó al 10,19%, y el ratio de capital tangible común subió al 7,28%. El margen de interés neto mejoró al 3,73% desde el 3,57% en el primer trimestre, con un aumento en el rendimiento de los préstamos anuales al 6,76% y una disminución en los costos de depósitos al 2,08%. La venta de todas las sucursales de Rocky Mountain Bank, que se espera genere una ganancia de $30 millones, se cerró a mediados de julio.

Comparado con el segundo trimestre de 2023, el ingreso neto cayó en $9,7 millones, y el EPS descendió $0,23. Sin embargo, las ganancias ajustadas aumentaron a $49,6 millones desde $46,5 millones. El ingreso neto por intereses ascendió a $158,7 millones, aumentando en $11,6 millones. Notablemente, los ingresos no por intereses cayeron en $14,3 millones debido a mayores pérdidas en valores y a menores cargos por servicios. Los gastos no por intereses aumentaron en $6,8 millones.

Heartland Financial USA (NASDAQ: HTLF)는 2024년 2분기 실적을 발표하며 순이익이 3,770만 달러, 주당 0.88달러, 조정된 수익이 4,960만 달러, 주당 1.15달러라고 전했습니다. 보고서에는 인수 비용 600만 달러와 위험과 유동성을 개선하기 위해 1억 840만 달러의 CRE 증권 매각에 따른 세전 손실 1,060만 달러가 강조되었습니다.

보통주 자본 비율은 10.19%로 증가했으며, 유형 보통주 자본 비율은 7.28%로 상승했습니다. 순이자 마진은 3.73%로 1분기 3.57%에서 개선되었고, 연간 대출 수익률은 6.76%로 증가했으며, 예금 비용은 2.08%로 감소했습니다. Rocky Mountain Bank의 모든 지점 판매는 3천만 달러의 이익을 기대하며 7월 중순에 마무리되었습니다.

2023년 2분기와 비교할 때, 순이익은 970만 달러 감소했으며, 주당 순이익(EPS)은 0.23달러 하락했습니다. 그러나 조정된 수익은 4,650만 달러에서 4,960만 달러로 증가했습니다. 순이자 수익은 1억 5,870만 달러로 증가하며 1,160만 달러 상승했습니다. 특히, 비이자 수익은 보안 손실 증가 및 서비스 수수료 감소로 인해 1,430만 달러 감소했습니다. 비이자 비용은 680만 달러 증가했습니다.

Heartland Financial USA (NASDAQ: HTLF) a annoncé ses résultats du deuxième trimestre 2024, avec un revenu net de 37,7 millions de dollars, soit 0,88 $ par action, et des gains ajustés de 49,6 millions de dollars, soit 1,15 $ par action. Le rapport met en avant des coûts d'acquisition de 6,0 millions de dollars et une perte avant impôts de 10,6 millions de dollars liée à la vente de 108,4 millions de dollars de titres CRE pour améliorer le risque et la liquidité.

Le ratio des capitaux propres ordinaires a augmenté à 10,19 %, et le ratio des capitaux propres tangibles ordinaires a grimpé à 7,28 %. La marge d'intérêt nette s'est améliorée à 3,73 %, contre 3,57 % au premier trimestre, avec une augmentation du rendement des prêts annuels à 6,76 % et une diminution des coûts de dépôts à 2,08 %. La vente de toutes les agences de la Rocky Mountain Bank, qui devrait générer un gain de 30 millions de dollars, a été finalisée à la mi-juillet.

Comparé au deuxième trimestre de 2023, le revenu net a chuté de 9,7 millions de dollars et le bénéfice par action (EPS) a baissé de 0,23 $. Cependant, les gains ajustés sont passés à 49,6 millions de dollars contre 46,5 millions de dollars. Le revenu net d'intérêts a grimpé à 158,7 millions de dollars, en hausse de 11,6 millions de dollars. Il est à noter que le revenu non d'intérêts a diminué de 14,3 millions de dollars en raison de la hausse des pertes sur titres et de la baisse des frais de service. Les dépenses non d'intérêts ont augmenté de 6,8 millions de dollars.

Heartland Financial USA (NASDAQ: HTLF) hat seine Ergebnisse für das 2. Quartal 2024 bekannt gegeben, mit einem Nettoergebnis von 37,7 Millionen USD, oder 0,88 USD pro Aktie, und bereinigten Erträgen von 49,6 Millionen USD, oder 1,15 USD pro Aktie. Der Bericht hebt 6,0 Millionen USD an Akquisekosten und einen vorsteuerlichen Verlust von 10,6 Millionen USD durch den Verkauf von 108,4 Millionen USD an CRE-Wertpapieren hervor, um Risiko und Liquidität zu verbessern.

Das Eigenkapitalverhältnis stieg auf 10,19%, und das tangible Eigenkapitalverhältnis stieg auf 7,28%. Die Nettozinsmarge verbesserte sich auf 3,73% von 3,57% im 1. Quartal, mit einem jährlichen Darlehenszins, der auf 6,76% stieg und den Einlagenkosten, die auf 2,08% sanken. Der Verkauf aller Filialen der Rocky Mountain Bank, der voraussichtlich einen Gewinn von 30 Millionen USD bringen wird, wurde Mitte Juli abgeschlossen.

Im Vergleich zum 2. Quartal 2023 fiel das Nettoergebnis um 9,7 Millionen USD, und das EPS sank um 0,23 USD. Die bereinigten Erträge stiegen jedoch von 46,5 Millionen USD auf 49,6 Millionen USD. Das Nettozins Ergebnis stieg auf 158,7 Millionen USD, ein Anstieg um 11,6 Millionen USD. Nennenswert ist, dass das nicht zinsertrags Einkommen um 14,3 Millionen USD aufgrund erhöhter Wertpapierverluste und gesenkter Dienstgebühren gesunken ist. Die nicht zinsertragsausgaben stiegen um 6,8 Millionen USD.

Positive
  • Net interest income increased by $11.6M or 8%.
  • Adjusted earnings available to common stockholders increased to $49.6M from $46.5M.
  • Common equity ratio increased to 10.19%; Tangible common equity ratio improved to 7.28%.
  • Net interest margin improved to 3.73% from 3.57% in Q1.
  • Annualized loan yield increased to 6.76%.
  • Annualized cost of deposits decreased to 2.08%.
  • Sale of Rocky Mountain Bank expected to yield a $30M gain in Q3.
Negative
  • Net income available to common stockholders decreased by $9.7M or 20%.
  • EPS decreased by $0.23 or 21%.
  • Noninterest income decreased by $14.3M or 44%.
  • $6.0M in acquisition, integration, and restructuring costs.
  • $10.6M pre-tax loss from selling $108.4M in CRE securities.

Insights

As a financial analyst, I see several key points in HTLF's Q2 2024 results:

  • Quarterly net income available to common stockholders was $37.7 million ($0.88 per share), down from $47.4 million ($1.11 per share) in Q2 2023. However, adjusted earnings of $49.6 million ($1.15 per share) show improvement when excluding one-time items.
  • Net interest margin improved to 3.73% from 3.23% year-over-year, indicating better profitability on lending activities.
  • The efficiency ratio increased to 65.70% from 60.93%, suggesting some decline in operational efficiency.
  • Total loans decreased slightly by 4% year-to-date, while deposits fell by 8%, potentially indicating some balance sheet contraction.
  • The sale of Rocky Mountain Bank branches, expected to close in Q3, should result in a $30 million gain and improve capital ratios.

Overall, while headline numbers show some pressure, core operations appear stable with margin improvements offsetting loan and deposit declines. The upcoming merger with UMB and strategic initiatives like the Rocky Mountain Bank sale could drive future efficiencies and growth.

From a banking industry perspective, HTLF's results reflect broader trends and challenges:

  • The improvement in net interest margin to 3.73% is noteworthy, outpacing many peers in the current rate environment. This suggests effective asset-liability management.
  • The 8% decline in deposits year-to-date, with a 39% reduction in wholesale deposits, indicates a shift away from higher-cost funding sources. This aligns with industry efforts to optimize funding mix in a higher rate environment.
  • The increase in nonperforming assets to 0.59% of total assets, while still manageable, bears watching. The addition of a $33.2 million nonperforming food manufacturing loan highlights potential stress in certain sectors.
  • The strategic sale of Rocky Mountain Bank branches demonstrates a focus on efficiency and market optimization, a trend seen across the banking sector as institutions reevaluate their geographic footprints.
  • The pending merger with UMB aligns with ongoing consolidation in the banking industry, as mid-sized banks seek scale to compete with larger institutions.

HTLF's actions, including branch divestitures and the UMB merger, position it well within the evolving competitive landscape of regional banking.

Analyzing HTLF's Q2 results from a risk management perspective:

  • The sale of $108.4 million in securities with CRE exposure, despite a $10.6 million pre-tax loss, demonstrates proactive risk management. This move improves the bank's risk profile and liquidity position.
  • The increase in the allowance for credit losses to 1.21% of total loans from 1.15% at year-end 2023 suggests prudent reserving practices in light of economic uncertainties.
  • The rise in nonperforming assets to 0.59% of total assets, while not alarming, warrants close monitoring. The concentration in specific sectors (food manufacturing, agriculture) highlights the importance of sector-specific risk assessments.
  • The improvement in the tangible common equity ratio to 7.28% enhances the bank's capital buffer against potential losses.
  • The strategic divestiture of Rocky Mountain Bank branches and the pending UMB merger indicate a focus on optimizing the risk-return profile of the institution.

Overall, HTLF appears to be taking appropriate steps to manage risks in a challenging environment, balancing growth with prudent risk management practices.

Second Quarter Highlights

  • Quarterly net income available to common stockholders of $37.7 million or $0.88 per common share.
  • Adjusted earnings available to common stockholders of $49.6 million or $1.15 adjusted diluted earnings per common share (non-GAAP).
  • $6.0 million of acquisition, integration and restructuring expenses in the quarter.
  • Sold $108.4 million of securities with CRE exposure at a pre-tax loss of $10.6 million to improve the risk and liquidity profile of the Company.
  • Common equity ratio increased to 10.19%; Tangible common equity ratio (non-GAAP) improved 40 basis points to 7.28%.
  • Net interest margin, full tax-equivalent (non-GAAP) increased to 3.73% for the quarter ended June 30, 2024 from 3.57% for the quarter ended March 31, 2024.
    • Annualized loan yield increased 13 basis points to 6.76%.
    • Annualized cost of deposits decreased 3 basis points to 2.08%.
  • Closed on the sale of all nine Rocky Mountain Bank branches in Montana in mid-July, including loans of $343.8 million and deposits of $531.8 million. The expected gain of $30 million will be realized in the third quarter of 2024 and may potentially be utilized to offset future losses related to selling securities or disposing of real estate.
 For the Quarter Ended Six Months Ended June 30,
 6/30/2024 3/31/2024 6/30/2023  2024   2023 
Earnings Summary:         
Net income/(loss) available to common stockholders (in millions)$37.7  $49.7  $47.4  $87.4  $98.2 
Diluted earnings/(loss) per common share 0.88   1.16   1.11   2.03   2.30 
Return on average assets 0.84%  1.08%  0.98%  0.96%  1.02%
Return on average common equity 8.14   10.90   11.01   9.51   11.70 
Return on average tangible common equity (non-GAAP)(1) 12.28   16.49   17.31   14.36   18.62 
Net interest margin 3.68   3.52   3.19   3.60   3.27 
Net interest margin, fully tax-equivalent (non-GAAP)(1) 3.73   3.57   3.23   3.65   3.32 
Efficiency ratio 65.70   62.46   60.93   64.05   60.94 
Adjusted efficiency ratio, fully-tax equivalent (non-GAAP)(1) 57.73   58.77   59.88   58.25   58.51 
          
Adjusted Earnings Summary (1):         
Adjusted earnings available to common stockholders (in millions)$49.6  $52.4  $46.5  $102.0  $100.2 
Adjusted diluted earnings per common share 1.15   1.22   1.09   2.37   2.34 
Adjusted annualized return on average assets 1.09%  1.13%  0.96%  1.11%  1.04%
Adjusted annualized return on average common equity 10.71   11.50   10.80   11.10   11.95 
Adjusted annualized return on average tangible common equity 16.05   17.38   17.00   16.70   19.00 
          

(1) Refer to "Non-GAAP Measures" in this earnings release for additional information on the usage and presentation of these non-GAAP measures, and refer to the financial tables for reconciliations to the most directly comparable GAAP measures.

 "HTLF delivered a solid second quarter. Net interest income increased while our adjusted efficiency ratio decreased. Our margin expanded through increased loan yields and decreased deposit costs as we continue to pay down high cost wholesale deposits. In July we completed the sale of Rocky Mountain Bank in Montana, a result of our strategic initiatives that will drive efficiency, enhance EPS growth, deliver higher return on assets and more efficient use of capital. We’re excited to be working closely with our partners at UMB on integration planning for our two companies as we continue towards an expected Q1 2025 transaction close date." 
 Bruce K. Lee, President and Chief Executive Officer, HTLF 


DENVER, July 30, 2024 (GLOBE NEWSWIRE) -- Heartland Financial USA, Inc. (NASDAQ: HTLF) today reported the following results for the quarter ended June 30, 2024, compared to the quarter ended June 30, 2023:

  • Net income available to common stockholders of $37.7 million compared to $47.4 million, a decrease of $9.7 million or 20%.
  • Earnings per diluted common share of $0.88 compared to $1.11, a decrease of $0.23 or 21%.
  • Adjusted earnings available to common stockholders(1) of $49.6 million or $1.15 per diluted common share compared to $46.5 million or $1.09 per diluted common share. Adjusted earnings in the second quarter of 2024 excludes $10.1 million of loss of security sales and $6.0 million of acquisition, integration and restructuring costs.
  • Net interest income of $158.7 million compared to $147.1 million, an increase of $11.6 million or 8%.
  • Annualized return on average assets of 0.84% compared to 0.98%. Adjusted annualized return on average assets(1) of 1.09% compared to 0.96%.
  • Annualized return on average common equity of 8.14% compared to 11.01%. Adjusted annualized return on average common equity(1) of 10.71% compared to 10.80%.
  • Annualized return on average tangible common equity(1) of 12.28% compared to 17.31%. Adjusted annualized return on average tangible common equity(1) of 16.05% compared to 17.00%.

Rocky Mountain Bank Sale

HTLF Bank closed on the sale of all nine Rocky Mountain Bank branches in Montana in mid-July along with all associated deposits and certain related assets to two purchasers. Loans of $348.8 million, deposits of $538.3 million and fixed assets of $13.2 million have been moved to available for sale categories as of June 30, 2024.

Net Interest Income and Net Interest Margin

Net interest margin, expressed as a percentage of average earning assets, was 3.68% (3.73% on a fully tax-equivalent basis, non-GAAP) for the second quarter of 2024 compared to 3.52% (3.57% on a fully tax-equivalent basis, non-GAAP) for the first quarter of 2024, and 3.19% (3.23% on a fully tax-equivalent basis, non-GAAP) for the second quarter of 2023.

Total interest income and average earning asset changes for the second quarter of 2024 compared to the second quarter of 2023 were:

  • Total interest income was $255.6 million compared to $235.5 million, an increase of $20.1 million or 9%, primarily attributable to an increase in yields on average earning assets. Interest income on loans during the second quarter of 2024 was positively impacted by $2.0 million due to the payoff of a $29.6 million owner-occupied commercial real estate loan which had previously been on nonaccrual.
  • Total interest income on a tax-equivalent basis (non-GAAP) was $257.6 million, an increase of $20.0 million or 8%, from $237.6 million.
  • Average earning assets decreased $1.19 billion or 6% to $17.33 billion compared to $18.52 billion, primarily due to the sale of $865.4 million of securities during the fourth quarter of 2023, and $108.4 million of securities during the second quarter of 2024. The proceeds were utilized to pay down high-cost wholesale deposits and borrowings.
  • The average rate on earning assets increased 83 basis points to 5.98% from 5.15%, primarily due to recent interest rate increases on earning assets.

Total interest expense and average interest-bearing liability changes for the second quarter of 2024 compared to the second quarter of 2023 were:

  • Total interest expense was $96.9 million, an increase of $8.5 million from $88.4 million, primarily due to increases in the average interest rate paid on interest-bearing liabilities, partially offset by decreases in average interest-bearing liabilities.
  • The average interest rate paid on interest-bearing liabilities increased 45 basis points to 3.13% from 2.68%.
  • Average interest-bearing deposits decreased $1.54 billion or 12% to $11.21 billion from $12.75 billion.
  • The average interest rate paid on interest-bearing deposits increased 31 basis points to 2.89% from 2.58%.
  • Average borrowings increased $792.9 million or 172% to $1.25 billion from $461.7 million, and the average interest rate paid on borrowings was 5.26% compared to 5.55%.

Net interest income changes for the second quarter of 2024 compared to the second quarter of 2023 were:

  • Net interest income totaled $158.7 million compared to $147.1 million, an increase of $11.6 million or 8%.
  • Net interest income on a tax-equivalent basis (non-GAAP) totaled $160.7 million compared to $149.3 million, an increase of $11.5 million or 8%.

Noninterest Income and Noninterest Expense

Total noninterest income was $18.2 million during the second quarter of 2024 compared to $32.5 million during the second quarter of 2023, a decrease of $14.3 million or 44%. Significant changes within the noninterest income category for the second quarter of 2024 compared to the second quarter of 2023 were:

  • Net security losses increased $9.8 million to $10.1 million compared to net security losses of $314,000.
  • Service charges and fees decreased $2.7 million or 14% to $17.0 million from $19.6 million, primarily attributable to a decrease in consumer NSF and overdraft fees. In the fourth quarter of 2023, HTLF instituted a new fee policy across our single charter customer base in response to industry changes related to consumer overdraft fees.
  • Capital market fees decreased $2.0 million or 51% to $2.0 million from $4.0 million due to lower capital markets activity.
  • Net gains on sales of loans held for sale decreased $1.1 million or 100% to $0 from $1.1 million, due to HTLF ceasing originations of residential mortgage loans to be sold to the secondary market.

Total noninterest expense was $116.2 million during the second quarter of 2024 compared to $109.4 million during the second quarter of 2023, an increase of $6.8 million or 6%. Significant changes within the noninterest expense category for the second quarter of 2024 compared to the second quarter of 2023 were:

  • Acquisition, integration, and restructuring costs totaled $6.0 million compared to $1.9 million, an increase of $4.1 million primarily attributable to expenses related to the pending UMB merger.
  • Salaries and employee benefits totaled $65.1 million compared to $62.1 million, an increase of $3.0 million or 5%. The increase was attributable to higher benefit costs including incentive compensation and retirement plans partially offset by a reduction of full-time equivalent employees. Full-time equivalent employees totaled 1,843 compared to 1,966, a decrease of 123 or 6%.
  • FDIC insurance assessments totaled $3.3 million compared to $3.0 million, an increase of $305,000.
  • Loss on sale of assets totaled $193,000 compared to a gain on assets of $3.4 million. During the second quarter of 2023, the recordkeeping and administration services component of HTLF's Retirement Plan Services business was sold, which generated a gain of $4.3 million.
  • Other noninterest expense totaled $14.3 million compared to $15.6 million, a decrease of $1.3 million or 8%, in conjunction with HTLF's 3.0 efficiency efforts.

The effective tax rate was 23.12% for the second quarter of 2024 compared to 23.74% for second quarter of 2023. The following items impacted the second quarter 2024 and 2023 tax calculations:

  • Various tax credits of $629,000 compared to $568,000.
  • Tax-exempt interest income as a percentage of pre-tax income of 14.49% compared to 12.40%.
  • Tax benefit of $92,000 compared to a tax expense of $121,000 resulting from the vesting of restricted stock units.
  • Tax expense of $1.1 million compared to $1.1 million resulting from the disallowed interest expense related to tax-exempt loans and securities.

Total Assets, Total Loans and Total Deposits

Total assets were $18.81 billion at June 30, 2024, a decrease of $599.0 million or 3% from $19.41 billion at year-end 2023. Securities represented 27% and 29% of total assets at June 30, 2024, and December 31, 2023, respectively.

Total loans held to maturity were $11.61 billion at June 30, 2024, compared to $11.64 billion at March 31, 2024, and $12.07 billion at December 31, 2023. Loans decreased $36.3 million or less than 1% during the second quarter of 2024 and $460.3 million or 4% since year-end 2023. Excluding the impact of the transfer of $348.8 million of loans to held for sale related to the planned sale of Rocky Mountain Bank, loans held to maturity decreased $40.3 million or less than 1% during the second quarter of 2024 and $111.6 million or 1% since year-end 2023. Significant changes by loan category at June 30, 2024 compared to March 31, 2024 included:

  • Commercial and business lending, which includes commercial and industrial, PPP and owner occupied commercial real estate loans, increased $6.8 million or less than 1% to $6.10 billion compared to $6.09 billion. Excluding the transfer related to Rocky Mountain Bank, commercial and business lending increased $5.1 million or less than 1%.
  • Commercial real estate lending, which includes non-owner occupied commercial real estate and construction loans, decreased $19.7 million or less than 1% to $3.52 billion compared to $3.54 billion. Excluding the transfer related to Rocky Mountain Bank, commercial real estate lending decreased $22.6 million or less than 1%.
  • Agricultural and agricultural real estate loans decreased $6.9 million or 1% to $803.0 million compared to $809.9 million. Excluding the transfer related to Rocky Mountain Bank, agricultural and agricultural real estate loans decreased $4.3 million or less than 1%.
  • Residential mortgage loans decreased $22.6 million or 3% to $733.4 million compared to $756.0 million. Excluding the transfer related to Rocky Mountain Bank, residential mortgage loans decreased $23.3 million or 3%.

Significant changes by loan category at June 30, 2024 compared to December 31, 2023 included:

  • Commercial and business lending, which includes commercial and industrial, PPP and owner occupied commercial real estate loans, decreased $193.9 million or 3% to $6.10 billion compared to $6.29 billion. Excluding the transfer related to Rocky Mountain Bank, commercial and business lending decreased $35.9 million or 1%.
  • Commercial real estate lending, which includes non-owner occupied commercial real estate and construction loans, decreased $48.4 million or 1% to $3.52 billion compared to $3.57 billion. Excluding the transfer related to Rocky Mountain Bank, commercial real estate lending increased $13.1 million or less than 1%.
  • Agricultural and agricultural real estate loans decreased $116.2 million or 13% to $803.0 million compared to $919.2 million. Excluding the transfer related to Rocky Mountain Bank, agricultural and agricultural real estate loans decreased $50.8 million or 6%.
  • Residential mortgage loans decreased $64.4 million or 8% to $733.4 million compared to $797.8 million. Excluding the transfer related to Rocky Mountain Bank, residential mortgage loans decreased $33.2 million or 4%.

Total deposits were $14.96 billion as of June 30, 2024, compared to $15.30 billion as of March 31, 2024, a decrease of $345.6 million or 2%. Total deposits were $14.96 billion as of June 30, 2024, compared to $16.20 billion at December 31, 2023, which was a decrease of $1.25 billion or 8%. Excluding the impact of the transfer of $538.3 million of deposits to held for sale related to the planned sale of Rocky Mountain Bank, deposits decreased $403.6 million or 3% during the second quarter of 2024 and $706.8 million or 4% since year-end 2023.

Total customer deposits were $14.13 billion as of June 30, 2024, compared to $14.27 billion at March 31, 2024, a decrease of $135.6 million or less than 1%. Excluding the impact of the transfer of $538.3 million of deposits to held for sale related to the planned sale of Rocky Mountain Bank, customer deposits decreased $193.7 million or 1%. Significant customer deposit changes by category at June 30, 2024, compared to March 31, 2024, included:

  • Customer demand deposits decreased $20.2 million or less than 1% to $4.24 billion compared to $4.26 billion. Excluding the transfer related to Rocky Mountain Bank, customer demand deposits decreased $31.6 million or less than 1%.
  • Customer savings deposits decreased $118.2 million or 1% to $8.15 billion compared to $8.27 billion. Excluding the transfer related to Rocky Mountain Bank, customer savings deposits decreased $157.0 million or 2%.
  • Customer time deposits increased $2.8 million or less than 1% to $1.74 billion compared to $1.73 billion. Excluding the transfer related to Rocky Mountain Bank, customer time deposits decreased $5.0 million or less than 1%.

Total customer deposits were $14.13 billion as of June 30, 2024, compared to $14.86 billion at December 31, 2023, a decrease of $722.7 million or 5%. Excluding the impact of the transfer of $538.3 million of deposits to held for sale related to the planned sale of Rocky Mountain Bank, customer deposits decreased $184.4 million. Significant customer deposit changes by category at June 30, 2024, compared to December 31, 2023, included:

  • Customer demand deposits decreased $256.1 million or 6% to $4.24 billion compared to $4.50 billion. Excluding the transfer related to Rocky Mountain Bank, customer demand deposits decreased $123.5 million or 3%.
  • Customer savings deposits decreased $259.4 million or 3% to $8.15 billion compared to $8.41 billion. Excluding the transfer related to Rocky Mountain Bank, customer savings deposits increased $32.0 million or less than 1%.
  • Customer time deposits decreased $207.2 million or 11% to $1.74 billion compared to $1.94 billion. Excluding the transfer related to Rocky Mountain Bank, customer time deposits decreased $92.9 million or 5%.

Total wholesale and institutional deposits were $822.9 million as of June 30, 2024, a decrease of $209.9 million or 20% from $1.03 billion at March 31, 2024. Significant wholesale and institutional deposit changes by category at June 30, 2024 compared to March 31, 2024 included:

  • Wholesale and institutional savings deposits decreased $80.6 million or 20% to $318.6 million compared to $399.3 million.
  • Wholesale time deposits decreased $129.3 million or 20% to $504.3 million compared to $633.6 million.

Total wholesale and institutional deposits were $822.9 million as of June 30, 2024, which was a decrease of $522.4 million or 39% from $1.35 billion at December 31, 2023. Significant wholesale and institutional deposit changes by category at June 30, 2024 compared to December 31, 2023 included:

  • Wholesale and institutional savings deposits decreased $75.7 million or 19% to $318.6 million compared to $394.4 million.
  • Wholesale time deposits decreased $446.6 million or 47% to $504.3 million compared to $950.9 million.

Provision and Allowance

Provision and Allowance for Credit Losses for Loans
Provision for credit losses for loans for the second quarter of 2024 was $9.7 million, an increase of $1.9 million from $7.8 million recorded in the second quarter of 2023.

The allowance for credit losses for loans totaled $126.9 million at June 30, 2024 and $122.6 million at December 31, 2023. The following items impacted the allowance for credit losses for loans at June 30, 2024:

  • Provision expense for the six months ended June 30, 2024, totaled $13.4 million. Provision expense was primarily impacted in the second quarter of 2024 by one new nonperforming food manufacturing loan which increased the specific reserve by $10.0 million.
  • Net charge-offs of $9.1 million, of which the majority have been reserved for in prior periods, were recorded for the first six months of 2024.

Provision and Allowance for Credit Losses for Unfunded Commitments
The allowance for unfunded commitments decreased $3.4 million or 21% to $13.1 million at June 30, 2024, from $16.5 million at December 31, 2023. The following impacted HTLF's allowance for credit losses for unfunded commitments during 2024:

  • Provision benefit for the six months ended June 30, 2024, totaled $3.4 million.
  • Reduction of $84.6 million in unfunded commitments for construction loans, which carry the highest loss rate.
  • Total unfunded commitments decreased $244.2 million or 5% to $4.38 billion at June 30, 2024 compared to $4.63 billion at December 31, 2023.

Total Provision and Allowance for Lending Related Credit Losses
The total provision expense for lending related credit losses was $9.0 million for the second quarter of 2024 compared to $5.4 million for the second quarter of 2023. The total allowance for lending related credit losses was $139.9 million or 1.21% of total loans at June 30, 2024, compared to $139.0 million or 1.15% of total loans as of December 31, 2023.

Nonperforming Assets

Nonperforming assets were $111.3 million or 0.59% of total assets at June 30, 2024, compared to $110.5 million or 0.57% of total assets at December 31, 2023. Nonperforming assets were reduced by the payoff of a $29.6 million owner occupied commercial real estate loan relationship. The reduction was offset by an increase primarily due to the addition of a $33.2 million food manufacturing customer and the addition of an $8.0 million agriculture customer. Nonperforming loans were $103.8 million or 0.89% of total loans at June 30, 2024, compared to $97.9 million or 0.81% of total loans at December 31, 2023. At June 30, 2024, loans delinquent 30-89 days were 0.25% of total loans compared to 0.09% of total loans at December 31, 2023. The increase in the 30-89 day delinquencies was due to a single $9.2 million real estate construction loan which became current subsequent to June 30, 2024. Other real estate owned, net, decreased $5.0 million or 40% to $7.5 million at June 30, 2024 from $12.5 million at December 31, 2023.

Non-GAAP Financial Measures

This earnings release contains references to financial measures which are not defined by generally accepted accounting principles ("GAAP"). Management believes the non-GAAP measures are helpful for investors to analyze and evaluate the company's financial condition and operating results. However, these non-GAAP measures have inherent limitations and should not be considered a substitute for operating results determined in accordance with GAAP. Additionally, because non-GAAP measures are not standardized, it may not be possible to compare the non-GAAP measures in this earnings release with other companies' non-GAAP measures. Reconciliations of each non-GAAP measure to the most directly comparable GAAP measure may be found in the financial tables in this earnings release.

Below are the non-GAAP measures included in this earnings release, management's reason for including each measure and the method of calculating each measure:

  • Adjusted earnings available to common stockholders and adjusted diluted earnings per common share, adjust net income for the gain/loss from sale of securities, and other non-operating expenses as well as the tax effect of those transactions. Management believes these measures enhance the comparability net income available to common stockholders as it reflects adjustments commonly made by management, investors and analysts to evaluate the ongoing operations and enhance comparability with the results of prior periods.
  • Adjusted annualized return on average assets, adjusts net income for the gain/loss from sale of securities, and other non-operating expenses as well as the tax effect of those transactions. Management believes this measure enhances the comparability of annualized return on average assets as it reflects adjustments commonly made by management, investors and analysts to evaluate the ongoing operations and enhance comparability with the results of prior periods.
  • Annualized net interest margin, fully tax-equivalent, adjusts net interest income for the tax-favored status of certain loans and securities. Management believes this measure enhances the comparability of net interest income arising from taxable and tax-exempt sources.
  • Adjusted efficiency ratio, fully tax equivalent, expresses noninterest expenses as a percentage of fully tax-equivalent net interest income and noninterest income. This efficiency ratio is presented on a tax-equivalent basis which adjusts net interest income and noninterest expenses for the tax favored status of certain loans, securities, and tax credit projects. Management believes the presentation of this non-GAAP measure provides supplemental useful information for proper understanding of the financial results as it enhances the comparability of income and expenses arising from taxable and nontaxable sources and excludes specific items as noted in reconciliation contained in this earnings release.
  • Net interest income, fully tax equivalent, is net income adjusted for the tax-favored status of certain loans and securities. Management believes this measure enhances the comparability of net interest income arising from taxable and tax-exempt sources. Net interest margin, fully tax equivalent, is net interest income adjusted for the tax-favored status of certain loans and securities divided by average earning assets.
  • Tangible book value per common share is total common equity less goodwill and core deposit and customer relationship intangibles, net, divided by common shares outstanding, net of treasury. This measure is included as it is considered to be a critical metric to analyze and evaluate use of equity, financial condition and capital strength.
  • Tangible common equity ratio is total common equity less goodwill and core deposit and customer relationship intangibles, net, divided by total assets less goodwill and core deposit and customer relationship intangibles, net. This measure is included as it is considered to be a critical metric to analyze and evaluate financial condition and capital strength.
  • Adjusted annualized return on average common equity, adjusts net income for the loss from sale of securities, and other non-operating expenses as well as the tax effect of those transactions. Management believes this measure enhances the comparability of annualized return on average assets as it reflects adjustments commonly made by management, investors and analysts to evaluate the ongoing operations and enhance comparability with the results of prior periods.
  • Annualized return on average tangible common equity is net income excluding intangible amortization calculated as (1) net income excluding tax-effected core deposit and customer relationship intangibles amortization, divided by (2) average common equity less goodwill and core deposit and customer relationship intangibles, net. This measure is included as it is considered to be a critical metric to analyze and evaluate use of equity, financial condition and capital strength.
  • Adjusted annualized return on average tangible common equity, adjusts net income available to common stockholders for the loss from sale of securities, and other non-operating expenses as well as the tax effect of those transactions. Management believes this measure enhances the comparability of annualized return on average assets as it reflects adjustments commonly made by management, investors and analysts to evaluate the ongoing operations and enhance comparability with the results of prior periods.
  • Annualized ratio of core expenses to average assets adjusts noninterest expenses to exclude specific items noted in the reconciliation. Management includes this measure as it is considered to be a critical metric to analyze and evaluate controllable expenses related to primary business operations.

About HTLF

Heartland Financial USA, Inc., is a Denver, Colorado-based bank holding company operating under the brand name HTLF, with assets of $18.81 billion as of June 30, 2024. HTLF's banks serve communities in Arizona, California, Colorado, Illinois, Iowa, Kansas, Minnesota, Missouri, New Mexico, Texas and Wisconsin. HTLF is committed to its core commercial business, supported by a strong retail operation, and provides a diversified line of financial services including treasury management, wealth management, investments and residential mortgage. Additional information is available at www.htlf.com.

Safe Harbor Statement

This release (including any information incorporated herein by reference), and future oral and written statements of the company and its management, may contain 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, with respect to the business, financial condition, results of operations, plans, objectives and future performance of HTLF.

Any statements about the company's expectations, beliefs, plans, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. Forward-looking statements may include information about possible or assumed future results of the company's operations or performance. These forward-looking statements are generally identified by the use of the words such as "believe", "expect", "intent", "anticipate", "plan", "intend", "estimate", "project", "may", "will", "would", "could", "should", "may", "view", "opportunity", "potential", or similar or negative expressions of these words or phrases that are used in this release, and future oral and written statements of the company and its management. Although the company may make these statements based on management’s experience, beliefs, expectations, assumptions and best estimate of future events, the ability of the company to predict results or the actual effect or outcomes of plans or strategies is inherently uncertain, and there may be events or factors that management has not anticipated. Therefore, the accuracy and achievement of such forward-looking statements and estimates are subject to a number of risks, many of which are beyond the ability of management to control or predict, that could cause actual results to differ materially from those in its forward-looking statements. These factors, which the company currently believes could have a material effect on its operations and future prospects, are detailed below and in the risk factors in HTLF's reports filed with the Securities and Exchange Commission ("SEC"), including the "Risk Factors" section under Item 1A of Part I of the company’s Annual Report on Form 10-K for the year ended December 31, 2023 and updates in HTLF's Forms 10-Q filed thereafter, and include, among others:

  • Economic and Market Conditions Risks, including risks related to the deterioration of the U.S. economy in general and in the local economies in which HTLF conducts its operations and future civil unrest, natural disasters, pandemics and governmental measures addressing them, climate change and climate-related regulations, persistent inflation, higher interest rates, supply chain issues, labor shortages, terrorist threats or acts of war;
  • Credit Risks, including risks of increasing credit losses due to deterioration in the financial condition of HTLF's borrowers, changes in asset and collateral values due to climate and other borrower industry risks, which may impact the provision for credit losses and net charge-offs;
  • Liquidity and Interest Rate Risks, including the impact of capital market conditions, rising interest rates and changes in monetary policy on our borrowings and net interest income;
  • Risks related to the planned merger with UMB Financial Corporation (the “Merger”), the fluctuation of the market value of the merger consideration, risks related to combining our businesses, including expenses related to the Merger and integration of the combined entity, risks that the Merger may not occur, and the risk of litigation related to the Merger;
  • Operational Risks, including processing, information systems, cybersecurity, vendor, business interruption, and fraud risks;
  • Strategic and External Risks, including economic, political, and competitive forces impacting our business;
  • Legal, Compliance and Reputational Risks, including regulatory and litigation risks; and
  • Risks of Owning Stock in HTLF, including stock price volatility and dilution as a result of future equity offerings and acquisitions.

There can be no assurance that other factors not currently anticipated by HTLF will not materially and adversely affect HTLF's business, financial condition and results of operations. Additionally, all statements in this release, including forward-looking statements speak only as of the date they are made. HTLF does not undertake and specifically disclaims any obligation to publicly release the results of any revisions which may be made to or correct or update any forward-looking statement to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events or to otherwise update any statement in light of new information or future events. Further information concerning HTLF and its business, including additional factors that could materially affect HTLF's financial results, is included in HTLF’s filings with the SEC.

-FINANCIAL TABLES FOLLOW-

CONTACT: 
Kevin L. Thompson 
Executive Vice President 
Chief Financial Officer 
(563) 589-1994 
kthompson@htlf.com 
  


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 For the Quarter Ended
June 30,		 For the Six Months Ended
June 30,
  2024   2023   2024   2023 
Interest Income       
Interest and fees on loans$199,161  $168,899  $394,822  $322,742 
Interest on securities:       
Taxable 47,381   58,172   94,395   114,148 
Nontaxable 6,042   6,378   12,083   12,406 
Interest on federal funds sold —   —   —   — 
Interest on deposits with other banks and short-term investments 3,045   2,051   6,051   3,182 
Total Interest Income 255,629   235,500   507,351   452,478 
Interest Expense       
Interest on deposits 80,499   81,975   164,633   138,873 
Interest on borrowings 10,825   848   18,349   3,270 
Interest on term debt 5,564   5,545   11,413   10,991 
Total Interest Expense 96,888   88,368   194,395   153,134 
Net Interest Income 158,741   147,132   312,956   299,344 
Provision for credit losses 9,008   5,379   9,994   8,453 
Net Interest Income After Provision for Credit Losses 149,733   141,753   302,962   290,891 
Noninterest Income       
Service charges and fees 16,964   19,627   34,027   36,763 
Loan servicing income 107   411   238   1,125 
Trust fees 5,532   5,419   10,575   11,076 
Brokerage and insurance commissions 894   677   1,648   1,373 
Capital markets fees 1,996   4,037   2,887   6,486 
Securities gains (losses), net (10,111)  (314)  (10,053)  (1,418)
Unrealized gain/(loss) on equity securities, net 133   (41)  228   152 
Net gains on sale of loans held for sale —   1,050   104   2,881 
Income on bank owned life insurance 1,326   1,220   2,503   2,184 
Other noninterest income 1,366   407   3,713   1,870 
Total Noninterest Income 18,207   32,493   45,870   62,492 
Noninterest Expense       
Salaries and employee benefits 65,120   62,099   129,075   124,248 
Occupancy 6,262   6,691   13,525   13,900 
Furniture and equipment 2,155   3,063   4,492   5,978 
Professional fees 15,372   15,194   30,903   27,991 
FDIC insurance assessments 3,340   3,035   8,309   6,314 
Advertising 1,368   3,052   2,726   5,037 
Core deposit intangibles amortization 1,421   1,715   2,913   3,503 
Other real estate and loan collection expenses, net 515   348   1,027   503 
(Gain) loss on sales/valuations of assets, net 193   (3,372)  407   (2,257)
Acquisition, integration and restructuring costs 5,973   1,892   7,348   3,565 
Partnership investment in tax credit projects 222   154   716   692 
Other noninterest expense 14,303   15,575   28,398   31,015 
Total Noninterest Expense 116,244   109,446   229,839   220,489 
Income Before Income Taxes 51,696   64,800   118,993   132,894 
Income taxes 11,954   15,384   27,544   30,702 
Net Income/(Loss) 39,742   49,416   91,449   102,192 
Preferred dividends (2,012)  (2,012)  (4,025)  (4,025)
Net Income/(Loss) Available to Common Stockholders$37,730  $47,404  $87,424  $98,167 
Earnings/(loss) per common share-diluted$0.88  $1.11  $2.03  $2.30 
Weighted average shares outstanding-diluted 43,060,354   42,757,603   43,001,157   42,753,197 


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 For the Quarter Ended
 6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023
Interest Income         
Interest and fees on loans$199,161  $195,661  $192,861  $182,394  $168,899 
Interest on securities:         
Taxable 47,381   47,014   54,573   54,800   58,172 
Nontaxable 6,042   6,041   6,278   6,584   6,378 
Interest on federal funds sold —   —   —   3   — 
Interest on deposits with other banks and short-term investments 3,045   3,006   2,174   1,651   2,051 
Total Interest Income 255,629   251,722   255,886   245,432   235,500 
Interest Expense         
Interest on deposits 80,499   84,134   88,071   92,744   81,975 
Interest on borrowings 10,825   7,524   5,874   1,167   848 
Interest on term debt 5,564   5,849   5,804   5,765   5,545 
Total Interest Expense 96,888   97,507   99,749   99,676   88,368 
Net Interest Income 158,741   154,215   156,137   145,756   147,132 
Provision for credit losses 9,008   986   11,738   1,516   5,379 
Net Interest Income After Provision for Credit Losses 149,733   153,229   144,399   144,240   141,753 
Noninterest Income         
Service charges and fees 16,964   17,063   18,708   18,553   19,627 
Loan servicing income 107   131   158   278   411 
Trust fees 5,532   5,043   4,905   4,734   5,419 
Brokerage and insurance commissions 894   754   729   692   677 
Capital markets fees 1,996   891   1,676   1,845   4,037 
Securities gains (losses), net (10,111)  58   (140,007)  (114)  (314)
Unrealized gain/(loss) on equity securities, net 133   95   75   13   (41)
Net gains on sale of loans held for sale —   104   94   905   1,050 
Income on bank owned life insurance 1,326   1,177   729   858   1,220 
Other noninterest income 1,366   2,347   1,132   619   407 
Total Noninterest Income 18,207   27,663   (111,801)  28,383   32,493 
Noninterest Expense         
Salaries and employee benefits 65,120   63,955   64,766   62,262   62,099 
Occupancy 6,262   7,263   6,509   6,438   6,691 
Furniture and equipment 2,155   2,337   2,901   2,720   3,063 
Professional fees 15,372   15,531   17,060   13,616   15,194 
FDIC insurance assessments 3,340   4,969   10,313   3,313   3,035 
Advertising 1,368   1,358   1,677   1,633   3,052 
Core deposit intangibles amortization 1,421   1,492   1,611   1,625   1,715 
Other real estate and loan collection expenses, net 515   512   505   481   348 
(Gain) loss on sales/valuations of assets, net 193   214   2,072   108   (3,372)
Acquisition, integration and restructuring costs 5,973   1,375   4,365   2,429   1,892 
Partnership investment in tax credit projects 222   494   3,573   1,136   154 
Other noninterest expense 14,303   14,095   14,933   15,292   15,575 
Total Noninterest Expense 116,244   113,595   130,285   111,053   109,446 
Income Before Income Taxes 51,696   67,297   (97,687)  61,570   64,800 
Income taxes 11,954   15,590   (27,324)  13,479   15,384 
Net Income/(Loss) 39,742   51,707   (70,363)  48,091   49,416 
Preferred dividends (2,012)  (2,013)  (2,012)  (2,013)  (2,012)
Net Income/(Loss) Available to Common Stockholders$37,730  $49,694  $(72,375) $46,078  $47,404 
Earnings/(loss) per common share-diluted$0.88  $1.16  $(1.69) $1.08  $1.11 
Weighted average shares outstanding-diluted 43,060,354   42,915,768   42,838,405   42,812,563   42,757,603 


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 As of
 6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023
Assets         
Cash and due from banks$226,735  $208,176  $275,554  $248,756  $317,303 
Interest-bearing deposits with other banks and short-term investments 147,211   236,190   47,459   99,239   82,884 
Cash and cash equivalents 373,946   444,366   323,013   347,995   400,187 
Time deposits in other financial institutions 1,340   1,240   1,240   1,490   1,490 
Securities:         
Carried at fair value 4,185,054   4,418,222   4,646,891   5,482,687   5,798,041 
Held to maturity, at cost 842,980   841,055   838,241   835,468   834,673 
Other investments, at cost 70,684   68,524   91,277   90,001   72,291 
Loans held for sale 348,761   352,744   5,071   6,262   14,353 
Loans:         
Held to maturity 11,608,309   11,644,641   12,068,645   11,872,436   11,717,974 
Allowance for credit losses (126,861)  (123,934)  (122,566)  (110,208)  (111,198)
Loans, net 11,481,448   11,520,707   11,946,079   11,762,228   11,606,776 
Premises, furniture and equipment, net 175,953   176,582   181,070   187,436   190,420 
Goodwill 576,005   576,005   576,005   576,005   576,005 
Core deposit intangibles, net 15,501   16,923   18,415   20,026   21,651 
Cash surrender value on life insurance 199,036   197,671   197,085   196,694   195,793 
Other real estate, net 7,533   2,590   12,548   14,362   2,677 
Other assets 534,429   516,198   574,772   609,139   510,359 
Total Assets$18,812,670  $19,132,827  $19,411,707  $20,129,793  $20,224,716 
Liabilities and Equity         
Liabilities         
Deposits:         
Demand$4,244,169  $4,264,390  $4,500,304  $4,792,813  $4,897,858 
Savings 8,470,416   8,669,221   8,805,597   8,754,911   8,772,596 
Time 2,242,005   2,368,555   2,895,813   3,553,269   3,993,089 
Total deposits 14,956,590   15,302,166   16,201,714   17,100,993   17,663,543 
Deposits held for sale 538,308   596,328   —   —   — 
Borrowings 694,909   650,033   622,255   392,634   44,364 
Term debt 372,988   372,652   372,396   372,059   372,403 
Accrued expenses and other liabilities 222,025   232,815   282,225   438,577   285,416 
Total Liabilities 16,784,820   17,153,994   17,478,590   18,304,263   18,365,726 
Stockholders' Equity         
Preferred equity 110,705   110,705   110,705   110,705   110,705 
Common stock 42,852   42,784   42,688   42,656   42,645 
Capital surplus 1,096,619   1,093,207   1,090,740   1,088,267   1,087,358 
Retained earnings 1,203,092   1,178,330   1,141,501   1,226,740   1,193,522 
Accumulated other comprehensive income/(loss) (425,418)  (446,193)  (452,517)  (642,838)  (575,240)
Total Equity 2,027,850   1,978,833   1,933,117   1,825,530   1,858,990 
Total Liabilities and Equity$18,812,670  $19,132,827  $19,411,707  $20,129,793  $20,224,716 


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 For the Quarter Ended
 6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023
Average Balances         
Assets$19,043,362  $19,296,638  $19,667,825  $20,207,920  $20,221,511 
Loans, net of unearned 12,010,289   12,021,930   11,938,272   11,800,064   11,625,442 
Total deposits 15,562,920   16,042,402   16,709,394   17,507,813   17,689,138 
Customer deposits 14,768,407   14,816,652   14,969,948   14,699,235   14,655,535 
Earning assets 17,331,435   17,597,068   17,853,957   18,439,010   18,523,552 
Interest-bearing liabilities 12,461,957   12,607,745   12,721,680   13,158,631   13,209,794 
Common equity 1,863,236   1,832,959   1,729,086   1,746,818   1,727,013 
Total stockholders' equity 1,973,941   1,943,664   1,839,791   1,857,523   1,837,718 
Tangible common equity (non-GAAP)(1) 1,271,046   1,239,313   1,133,888   1,149,992   1,128,527 
          
Key Performance Ratios         
Annualized return on average assets 0.84%  1.08% (1.42)%  0.94%  0.98%
Adjusted annualized return on average assets (non-GAAP)(1) 1.09   1.13   0.96   0.98   0.96 
Annualized return on average common equity (GAAP) 8.14   10.90   (16.61)  10.47   11.01 
Adjusted annualized return on average common equity (non-GAAP)(1) 10.71   11.50   10.46   10.92   10.80 
Annualized return on average tangible common equity (non-GAAP)(1) 12.28   16.49   (24.89)  16.32   17.31 
Adjusted annualized return on average tangible common equity (non-GAAP)(1) 16.05   17.38   16.38   17.02   17.00 
Annualized ratio of net charge-offs/(recoveries) to average loans 0.23   0.08   0.01   0.12   0.32 
Annualized net interest margin (GAAP) 3.68   3.52   3.47   3.14   3.19 
Annualized net interest margin, fully tax-equivalent (non-GAAP)(1) 3.73   3.57   3.52   3.18   3.23 
Annualized cost of deposits 2.08   2.11   2.09   2.10   1.86 
Efficiency ratio (GAAP) 65.70   62.46   293.86   63.77   60.93 
Adjusted efficiency ratio, fully tax-equivalent (non-GAAP)(1) 57.73   58.77   59.31   59.95   59.88 
Annualized ratio of total noninterest expenses to average assets (GAAP) 2.46   2.37   2.63   2.18   2.17 
Annualized ratio of core expenses to average assets (non-GAAP)(1) 2.30   2.25   2.23   2.08   2.16 
          


 For the Quarter Ended
June 30,		 For the Six Months Ended
June 30,
  2024   2023   2024   2023 
Average Balances       
Assets$19,043,362  $20,221,511  $19,170,002  $20,170,044 
Loans, net of unearned 12,010,289   11,625,442   12,016,110   11,502,443 
Total deposits 15,562,920   17,689,138   15,802,661   17,598,009 
Customer deposits 14,768,407   14,655,535   14,792,530   14,888,066 
Earning assets 17,331,435   18,523,552   17,464,253   18,458,462 
Interest-bearing liabilities 12,461,957   13,209,794   12,534,852   12,897,747 
Common equity 1,863,236   1,727,013   1,848,098   1,691,633 
Total stockholders' equity 1,973,941   1,837,718   1,958,803   1,802,338 
Tangible common equity (non-GAAP)(1) 1,271,046   1,128,527   1,255,180   1,092,273 
        
Key Performance Ratios       
Annualized return on average assets 0.84%  0.98%  0.96%  1.02%
Adjusted annualized return on average assets (non-GAAP)(1) 1.09   0.96   1.11   1.04 
Annualized return on average common equity (GAAP) 8.14   11.01   9.51   11.70 
Adjusted annualized return on average common equity (non-GAAP)(1) 10.71   10.80   11.10   11.95 
Annualized return on average tangible common equity (non-GAAP)(1) 12.28   17.31   14.36   18.62 
Adjusted annualized return on average tangible common equity (non-GAAP)(1) 16.05   17.00   16.70   19.00 
Annualized ratio of net charge-offs/(recoveries) to average loans 0.23   0.32   0.15   0.15 
Annualized net interest margin (GAAP) 3.68   3.19   3.60   3.27 
Annualized net interest margin, fully tax-equivalent (non-GAAP)(1) 3.73   3.23   3.65   3.32 
Annualized cost of deposits 2.08   1.86   2.10   1.59 
Efficiency ratio (GAAP) 65.70   60.93   64.05   60.94 
Adjusted efficiency ratio, fully tax-equivalent (non-GAAP)(1) 57.73   59.88   58.25   58.51 
Annualized ratio of total noninterest expenses to average assets (GAAP) 2.46   2.17   2.41   2.20 
Annualized ratio of core expenses to average assets (non-GAAP)(1) 2.30   2.16   2.28   2.15 
        
(1) Refer to "Non-GAAP Measures" in this earnings release for additional information on the usage and presentation of these non-GAAP measures, and refer to these financial tables for the reconciliations to the most directly comparable GAAP measures.


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE AND FULL TIME EQUIVALENT EMPLOYEE DATA
 As of and for the Quarter Ended
 6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023
Common Share Data         
Book value per common share$44.74  $43.66  $42.69  $40.20  $41.00 
Tangible book value per common share (non-GAAP)(1) 30.94   29.81   28.77   26.23   26.98 
ASC 320 effect on book value per common share (10.82)  (11.18)  (11.00)  (16.27)  (14.04)
          
Common shares outstanding, net of treasury stock 42,852,180   42,783,670   42,688,008   42,656,303   42,644,544 
          
Capital Ratios         
Common equity ratio 10.19%  9.76%  9.39%  8.52%  8.64%
Tangible common equity ratio (non-GAAP)(1) 7.28   6.88   6.53   5.73   5.86 
Tier 1 leverage ratio 10.13   9.84   9.44   9.59   9.40 
Common equity tier 1 ratio(2) 11.68   11.40   10.97   11.37   11.33 
Total risk based capital ratio(2) 15.32   14.99   14.53   14.90   14.93 
          
Other Selected Trend Information          
Effective tax rate 23.12%  23.17%  27.97%  21.89%  23.74%
Full time equivalent employees 1,843   1,888   1,970   1,965   1,966 
          
Loans Held to Maturity         
Commercial and industrial$3,541,239  $3,545,051  $3,652,047  $3,591,809  $3,590,680 
Paycheck Protection Program ("PPP") 1,864   2,172   2,777   3,750   4,139 
Owner occupied commercial real estate 2,555,964   2,545,033   2,638,175   2,429,659   2,398,698 
Commercial and business lending 6,099,067   6,092,256   6,292,999   6,025,218   5,993,517 
Non-owner occupied commercial real estate 2,434,258   2,495,068   2,553,711   2,656,358   2,530,736 
Real estate construction 1,082,726   1,041,583   1,011,716   1,029,554   1,013,134 
Commercial real estate lending 3,516,984   3,536,651   3,565,427   3,685,912   3,543,870 
Total commercial lending 9,616,051   9,628,907   9,858,426   9,711,130   9,537,387 
Agricultural and agricultural real estate 802,958   809,876   919,184   842,116   839,817 
Residential mortgage 733,401   756,021   797,829   813,803   828,437 
Consumer 455,899   449,837   493,206   505,387   512,333 
Total loans held to maturity$11,608,309  $11,644,641  $12,068,645  $11,872,436  $11,717,974 
          
Total unfunded loan commitments$4,381,565  $4,537,718  $4,625,768  $4,813,798  $4,905,147 
          
Deposits          
Demand-customer$4,244,169  $4,264,390  $4,500,304  $4,792,813  $4,897,858 
Savings-customer 8,151,794   8,269,956   8,411,240   8,190,430   8,149,596 
Savings-wholesale and institutional 318,622   399,265   394,357   564,481   623,000 
Total savings 8,470,416   8,669,221   8,805,597   8,754,911   8,772,596 
Time-customer 1,737,723   1,734,971   1,944,884   1,814,335   1,597,849 
Time-wholesale 504,282   633,584   950,929   1,738,934   2,395,240 
Total time 2,242,005   2,368,555   2,895,813   3,553,269   3,993,089 
Total deposits $14,956,590  $15,302,166  $16,201,714  $17,100,993  $17,663,543 
          
Total customer deposits$14,133,686  $14,269,317  $14,856,428  $14,797,578  $14,645,303 
Total wholesale and institutional deposits 822,904   1,032,849   1,345,286   2,303,415   3,018,240 
Total deposits$14,956,590  $15,302,166  $16,201,714  $17,100,993  $17,663,543 
          
(1) Refer to "Non-GAAP Measures" in this earnings release for additional information on the usage and presentation of these non-GAAP measures, and refer to these financial tables for the reconciliations to the most directly comparable GAAP measures.
(2) June 30, 2024 calculation is preliminary.


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 As of and for the Quarter Ended
 6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023
Allowance for Credit Losses-Loans         
Balance, beginning of period$123,934  $122,566  $110,208  $111,198  $112,707 
Provision for credit losses 9,737   3,668   12,750   2,672   7,829 
Charge-offs (7,388)  (4,093)  (3,886)  (3,964)  (9,613)
Recoveries 578   1,793   3,494   302   275 
Balance, end of period$126,861  $123,934  $122,566  $110,208  $111,198 
          
Allowance for Unfunded Commitments         
Balance, beginning of period$13,786  $16,468  $17,480  $18,636  $21,086 
Provision for credit losses (729)  (2,682)  (1,012)  (1,156)  (2,450)
Balance, end of period$13,057  $13,786  $16,468  $17,480  $18,636 
          
Allowance for lending related credit losses$139,918  $137,720  $139,034  $127,688  $129,834 
          
Provision for Credit Losses         
Provision for credit losses-loans$9,737  $3,668  $12,750  $2,672  $7,829 
Provision for credit losses-unfunded commitments (729)  (2,682)  (1,012)  (1,156)  (2,450)
Total provision (benefit) for credit losses$9,008  $986  $11,738  $1,516  $5,379 
          
Asset Quality         
Nonaccrual loans$103,123  $94,800  $95,426  $51,304  $61,956 
Loans past due ninety days or more 663   611   2,507   511   1,459 
Other real estate owned 7,533   2,590   12,548   14,362   2,677 
Other repossessed assets —   —   —   1   5 
Total nonperforming assets$111,319  $98,001  $110,481  $66,178  $66,097 
          
Nonperforming Assets Activity          
Balance, beginning of period$98,001  $110,481  $66,178  $66,097  $65,702 
Net loan (charge-offs) recoveries (6,810)  (2,300)  (392)  (3,662)  (9,338)
New nonperforming loans 48,346   5,470   61,193   19,295   19,805 
Reduction of nonperforming loans(1) (28,050)  (5,692)  (14,278)  (14,691)  (5,253)
OREO/Repossessed assets sales proceeds (168)  (9,958)  (2,220)  (861)  (4,819)
Balance, end of period$111,319  $98,001  $110,481  $66,178  $66,097 
          
Asset Quality Ratios         
Ratio of nonperforming loans to total loans 0.89%  0.82%  0.81%  0.44%  0.54%
Ratio of nonperforming assets to total assets 0.59   0.51   0.57   0.33   0.33 
Annualized ratio of net loan charge-offs (recoveries) to average loans 0.23   0.08   0.01   0.12   0.32 
Allowance for loan credit losses as a percent of loans 1.09   1.06   1.02   0.93   0.95 
Allowance for lending related credit losses as a percent of loans 1.21   1.18   1.15   1.08   1.11 
Allowance for loan credit losses as a percent of nonperforming loans 122.23   129.89   125.15   212.70   175.35 
Loans delinquent 30-89 days as a percent of total loans 0.25   0.31   0.09   0.12   0.12 
          
(1) Includes principal reductions, transfers to performing status and transfers to OREO.


   
HEARTLAND FINANCIAL USA, INC.  
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS
 For the Quarter Ended
 June 30, 2024 March 31, 2024 June 30, 2023
 Average
Balance		 Interest Rate Average
Balance		 Interest Rate Average
Balance		 Interest Rate
Earning Assets                 
Securities:                 
Taxable$4,490,407  $47,381 4.24% $4,665,196  $47,014 4.05% $5,962,207  $58,172 3.91%
Nontaxable(1) 759,234   7,383 3.91   778,632   7,383 3.81   895,458   7,896 3.54 
Total securities 5,249,641   54,764 4.20   5,443,828   54,397 4.02   6,857,665   66,068 3.86 
Interest on deposits with other banks and short-term investments 194,824   3,045 6.29   253,189   3,006 4.78   153,622   2,051 5.36 
Federal funds sold —   — —   —   — —   —   — — 
Loans:(2)                 
Commercial and industrial(1) 3,638,004   69,469 7.68   3,642,588   66,985 7.40   3,565,449   56,644 6.37 
PPP loans 2,242   7 1.26   2,587   8 1.24   6,302   24 1.53 
Owner occupied commercial real estate 2,615,504   37,028 5.69   2,609,773   35,517 5.47   2,366,107   28,031 4.75 
Non-owner occupied commercial real estate 2,519,346   39,272 6.27   2,550,419   39,849 6.28   2,462,098   35,583 5.80 
Real estate construction 1,093,399   21,770 8.01   1,061,843   20,849 7.90   1,028,109   18,528 7.23 
Agricultural and agricultural real estate 879,707   13,390 6.12   878,621   13,756 6.30   848,554   12,256 5.79 
Residential real estate 776,821   9,454 4.89   791,248   10,135 5.15   840,741   9,383 4.48 
Consumer 485,266   9,421 7.81   484,851   9,201 7.63   508,082   9,068 7.16 
Less: allowance for credit losses (123,319)  — —   (121,879)  — —   (113,177)  — — 
Net loans 11,886,970   199,811 6.76   11,900,051   196,300 6.63   11,512,265   169,517 5.91 
Total earning assets 17,331,435   257,620 5.98%  17,597,068   253,703 5.80%  18,523,552   237,636 5.15%
Nonearning Assets 1,711,927       1,699,570       1,697,959     
Total Assets$19,043,362      $19,296,638      $20,221,511     
Interest-bearing Liabilities                 
Savings$8,834,746  $55,440 2.52% $8,809,530  $54,667 2.50% $8,935,775  $41,284 1.85%
Time deposits 2,372,653   25,059 4.25   2,782,195   29,467 4.26   3,812,330   40,691 4.28 
Borrowings 881,738   10,825 4.94   643,525   7,524 4.70   89,441   848 3.80 
Term debt 372,820   5,564 6.00   372,495   5,849 6.32   372,248   5,545 5.97 
Total interest-bearing liabilities 12,461,957   96,888 3.13%  12,607,745   97,507 3.11%  13,209,794   88,368 2.68%
Noninterest-bearing Liabilities                 
Noninterest-bearing deposits 4,355,521       4,450,677       4,941,033     
Accrued interest and other liabilities 251,943       294,552       232,966     
Total noninterest-bearing liabilities 4,607,464       4,745,229       5,173,999     
Stockholders' Equity 1,973,941       1,943,664       1,837,718     
Total Liabilities and Stockholders' Equity$19,043,362      $19,296,638      $20,221,511     
Net interest income, fully tax-equivalent (non-GAAP)(1)(3)  $160,732     $156,196     $149,268  
Net interest spread(1)    2.85%     2.69%     2.47%
Net interest income, fully tax-equivalent (non-GAAP)(1)(3) to total earning assets    3.73%     3.57%     3.23%
Interest-bearing liabilities to earning assets 71.90%      71.65%      71.31%    
                  
(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.  
(2) Nonaccrual loans and loans held for sale are included in the average loans outstanding.
(3) Refer to "Non-GAAP Measures" in this earnings release for additional information on the usage and presentation of these non-GAAP measures, and refer to these financial tables for the reconciliations to the most directly comparable GAAP measures.


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS
 For the Six Months Ended
 June 30, 2024 June 30, 2023
 Average
Balance		 Interest Rate Average
Balance		 Interest Rate
Earning Assets           
Securities:           
Taxable$4,577,802  $94,395 4.14% $6,029,175  $114,148 3.82%
Nontaxable(1) 768,933   14,766 3.85   908,992   15,704 3.48 
Total securities 5,346,735   109,161 4.11   6,938,167   129,852 2.50 
Interest on deposits with other banks and other short-term investments 224,007   6,051 5.42   129,645   3,182 4.95 
Federal funds sold —   — —   —   — — 
Loans:(2)           
Commercial and industrial(1) 3,640,298   136,454 7.54   3,512,807   106,551 6.12 
PPP loans 2,415   14 1.17   8,126   50 1.24 
Owner occupied commercial real estate 2,612,638   72,545 5.58   2,327,702   54,800 4.75 
Non-owner occupied commercial real estate 2,534,882   79,121 6.28   2,397,004   66,332 5.58 
Real estate construction 1,077,621   42,619 7.95   1,063,372   36,659 6.95 
Agricultural and agricultural real estate 879,164   27,146 6.21   842,136   23,609 5.65 
Residential mortgage 784,034   19,589 5.02   846,618   18,656 4.44 
Consumer 485,058   18,622 7.72   504,678   17,310 6.92 
Less: allowance for credit losses-loans (122,599)  — —   (111,793)  — — 
Net loans 11,893,511   396,110 6.70   11,390,650   323,967 5.74 
Total earning assets 17,464,253   511,322 5.89%  18,458,462   457,001 4.99%
Nonearning Assets 1,705,749       1,711,582     
Total Assets$19,170,002      $20,170,044     
Interest-bearing Liabilities           
Savings$8,822,138  $110,107 2.51% $9,330,939  $79,177 1.71%
Time deposits 2,577,424   54,526 4.25   3,038,985   59,696 3.96 
Borrowings 762,632   18,349 4.84   155,738   3,270 4.23 
Term debt 372,658   11,413 6.16   372,085   10,991 5.96 
Total interest-bearing liabilities 12,534,852   194,395 3.12%  12,897,747   153,134 2.39%
Noninterest-bearing Liabilities           
Noninterest-bearing deposits 4,403,099       5,228,085     
Accrued interest and other liabilities 273,248       241,874     
Total noninterest-bearing liabilities 4,676,347       5,469,959     
Stockholders' Equity 1,958,803       1,802,338     
Total Liabilities and Stockholders' Equity$19,170,002      $20,170,044     
Net interest income, fully tax-equivalent (non-GAAP)(1)(3)  $316,927     $303,867  
Net interest spread(1)    2.77%     2.60%
Net interest income, fully tax-equivalent (non-GAAP)(1)(3) to total earning assets    3.65%     3.32%
Interest-bearing liabilities to earning assets 71.77%      69.87%    
            
(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.  
(2) Nonaccrual loans and loans held for sale are included in the average loans outstanding.
(3) Refer to "Non-GAAP Measures" in this earnings release for additional information on the usage and presentation of these non-GAAP measures, and refer to these financial tables for the reconciliations to the most directly comparable GAAP measures.


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA AND FULL TIME EQUIVALENT EMPLOYEE DATA
 For the Quarter Ended
 6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023
Reconciliation of Annualized Return on Average Tangible Common Equity (non-GAAP)         
Earnings available to common stockholders (GAAP)$37,730  $49,694  $(72,375) $46,078  $47,404 
Plus core deposit intangibles amortization, net of tax(2) 1,081   1,131   1,229   1,240   1,309 
Earnings available to common stockholders excluding intangible amortization (non-GAAP)$38,811  $50,825  $(71,146) $47,318  $48,713 
          
Average common equity (GAAP)$1,863,236  $1,832,959  $1,729,086  $1,746,818  $1,727,013 
Less average goodwill 576,005   576,005   576,005   576,005   576,005 
Less average core deposit intangibles, net 16,185   17,641   19,193   20,821   22,481 
Average tangible common equity (non-GAAP)$1,271,046  $1,239,313  $1,133,888  $1,149,992  $1,128,527 
Annualized return on average common equity (GAAP) 8.14%  10.90% (16.61)%  10.47%  11.01%
Annualized return on average tangible common equity (non-GAAP) 12.28%  16.49% (24.89)%  16.32%  17.31%
          
Reconciliation of Annualized Net Interest Margin, Fully Tax-Equivalent (non-GAAP)         
Net Interest Income (GAAP)$158,741  $154,215  $156,137  $145,756  $147,132 
Plus tax-equivalent adjustment(1) 1,991   1,981   2,058   2,152   2,136 
Net interest income, fully tax-equivalent (non-GAAP)$160,732  $156,196  $158,195  $147,908  $149,268 
          
Average earning assets$17,331,435  $17,597,068  $17,853,957  $18,439,010  $18,523,552 
          
Annualized net interest margin (GAAP) 3.68%  3.52%  3.47%  3.14%  3.19%
Annualized net interest margin, fully tax-equivalent (non-GAAP) 3.73   3.57   3.52   3.18   3.23 
Net purchase accounting discount amortization on loans included in annualized net interest margin 0.01   0.02   0.02   0.01   0.03 


Reconciliation of Tangible Book Value Per Common Share (non-GAAP)                   
Common equity (GAAP)$1,917,145  $1,868,128  $1,822,412  $1,714,825  $1,748,285 
Less goodwill 576,005   576,005   576,005   576,005   576,005 
Less core deposit intangibles, net 15,501   16,923   18,415   20,026   21,651 
Tangible common equity (non-GAAP)$1,325,639  $1,275,200  $1,227,992  $1,118,794  $1,150,629 
          
Common shares outstanding, net of treasury stock 42,852,180   42,783,670   42,688,008   42,656,303   42,644,544 
Common equity (book value) per share (GAAP)$44.74  $43.66  $42.69  $40.20  $41.00 
Tangible book value per common share (non-GAAP)$30.94  $29.81  $28.77  $26.23  $26.98 
          
Reconciliation of Tangible Common Equity Ratio (non-GAAP)                   
Tangible common equity (non-GAAP)$1,325,639  $1,275,200  $1,227,992  $1,118,794  $1,150,629 
          
Total assets (GAAP)$18,812,670  $19,132,827  $19,411,707  $20,129,793  $20,224,716 
Less goodwill 576,005   576,005   576,005   576,005   576,005 
Less core deposit intangibles, net 15,501   16,923   18,415   20,026   21,651 
Total tangible assets (non-GAAP)$18,221,164  $18,539,899  $18,817,287  $19,533,762  $19,627,060 
Tangible common equity ratio (non-GAAP) 7.28%  6.88%  6.53%  5.73%  5.86%
          
(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.
(2) Tax effect is calculated based on the respective periods’ year-to-date effective tax rate excluding the impact of discrete items.


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 For the Quarter Ended
6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023
Reconciliation of Adjusted Efficiency Ratio, fully tax-equivalent (non-GAAP) 
Net interest income (GAAP)$158,741  $154,215  $156,137  $145,756  $147,132 
Tax-equivalent adjustment(1) 1,991   1,981   2,058   2,152   2,136 
Fully tax-equivalent net interest income 160,732   156,196   158,195   147,908   149,268 
Noninterest income 18,207   27,663   (111,801)  28,383   32,493 
Securities (gains)/losses, net 10,111   (58)  140,007   114   314 
Unrealized (gain)/loss on equity securities, net (133)  (95)  (75)  (13)  41 
Adjusted revenue (non-GAAP)$188,917  $183,706  $186,326  $176,392  $182,116 
          
Total noninterest expenses (GAAP)$116,246  $113,595  $130,285  $111,053  $109,446 
Less:         
Core deposit intangibles amortization 1,421   1,492   1,611   1,625   1,715 
Partnership investment in tax credit projects 222   494   3,573   1,136   154 
(Gain) loss on sales/valuation of assets, net 193   214   2,072   108   (3,372)
Acquisition, integration and restructuring costs 5,973   1,375   4,365   2,429   1,892 
FDIC special assessment (631)  2,049   8,145   —   — 
Core expenses (non-GAAP)$109,068  $107,971  $110,519  $105,755  $109,057 
          
Efficiency ratio (GAAP) 65.70%  62.46%  293.86%  63.77%  60.93%
Adjusted efficiency ratio, fully tax-equivalent (non-GAAP) 57.73%  58.77%  59.31%  59.95%  59.88%
          
Reconciliation of Annualized Ratio of Core Expenses to Average Assets (non-GAAP)         
Total noninterest expenses (GAAP)$116,246  $113,595  $130,285  $111,053  $109,446 
Core expenses (non-GAAP) 109,068   107,971   110,519   105,755   109,057 
          
Average assets$19,043,362  $19,296,638  $19,667,825  $20,207,920  $20,221,511 
Total noninterest expenses to average assets (GAAP) 2.46%  2.37%  2.63%  2.18%  2.17%
Core expenses to average assets (non-GAAP) 2.30%  2.25%  2.23%  2.08%  2.16%
          
Acquisition, integration and restructuring costs         
Salaries and employee benefits$462  $168  $1,425  $94  $93 
Occupancy —   —   1,092   —   — 
Furniture and equipment 53   —   19   —   — 
Professional fees 5,385   931   793   1,617   1,068 
Advertising —   —   28   178   222 
Other noninterest expenses 73   276   1,008   540   509 
Total acquisition, integration and restructuring costs$5,973  $1,375  $4,365  $2,429  $1,892 
          
(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.
 
 
 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 For the Quarter Ended
 6/30/2024 3/31/2024 12/31/2023 9/30/2023 6/30/2023
Reconciliation of Adjusted Earnings         
Net income/(loss)$39,742  $51,707  $(70,363) $48,091  $49,416 
(Gain)/loss from sale of securities 10,111   (58)  140,007   114   314 
(Gain)/loss on sales/valuation of assets, net 193   214   2,072   108   (3,372)
Acquisition, integration and restructuring costs 5,973   1,375   4,365   2,429   1,892 
FDIC special assessment (631)  2,049   8,145   —   — 
Total adjustments 15,646   3,580   154,589   2,651   (1,166)
Tax effect of adjustments(2) (3,739)  (866)  (36,638)  (628)  276 
Adjusted earnings$51,649  $54,421  $47,588  $50,114  $48,526 
          
Preferred dividends (2,012)  (2,013)  (2,012)  (2,013)  (2,012)
Adjusted earnings available to common stockholders$49,637  $52,408  $45,576  $48,101  $46,514 
          
Plus core deposit intangibles amortization, net of tax(2) 1,081   1,131   1,229   1,240   1,309 
Earnings available to common stockholders excluding intangible amortization (non-GAAP)$50,718  $53,539  $46,805  $49,341  $47,823 
          
Reconciliation of Adjusted Annualized Return on Average Assets         
Average assets$19,043,362  $19,296,638  $19,667,825  $20,207,920  $20,221,511 
Adjusted annualized return on average assets (non-GAAP) 1.09%  1.13%  0.96%  0.98%  0.96%
          
Reconciliation of Adjusted Annualized Return on Average Common Equity         
Average common stockholders' equity (GAAP)$1,863,236  $1,832,959  $1,729,086  $1,746,818  $1,727,013 
Adjusted annualized average common equity (non-GAAP) 10.71%  11.50%  10.46%  10.92%  10.80%
          
Reconciliation of Adjusted Annualized Return on Average Tangible Common Equity         
Average tangible common equity (non-GAAP)$1,271,046  $1,239,313  $1,133,888  $1,149,992  $1,128,527 
Adjusted annualized average tangible common equity (non-GAAP) 16.05%  17.38%  16.38%  17.02%  17.00%
          
Reconciliation of Adjusted Diluted Earnings Per Common Share         
Weighted average shares outstanding-diluted 43,060,354   42,915,768   42,838,405   42,812,563   42,757,603 
Adjusted diluted earnings per common share$1.15  $1.22  $1.06  $1.12  $1.09 
          
(2) Tax effect is calculated based on the respective periods’ year-to-date effective tax rate excluding the impact of discrete items.


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 For the Quarter Ended
June 30,		 For the Six Months Ended
June 30,
  2024   2023   2024   2023 
Reconciliation of Annualized Return on Average Tangible Common Equity (non-GAAP)       
Earnings available to common stockholders (GAAP)$37,730  $47,404  $87,424  $98,167 
Plus core deposit intangibles amortization, net of tax(2) 1,081   1,309   2,211   2,673 
Earnings available to common stockholders excluding intangible amortization (non-GAAP)$38,811  $48,713  $89,635  $100,840 
        
Average common equity (GAAP)$1,863,236  $1,727,013  $1,848,098  $1,691,633 
Less average goodwill 576,005   576,005   576,005   576,005 
Less average core deposit intangibles, net 16,185   22,481   16,913   23,355 
Average tangible common equity (non-GAAP)$1,271,046  $1,128,527  $1,255,180  $1,092,273 
Annualized return on average common equity (GAAP) 8.14%  11.01%  9.51%  11.70%
Annualized return on average tangible common equity (non-GAAP) 12.28%  17.31%  14.36%  18.62%
        
Reconciliation of Annualized Net Interest Margin, Fully Tax-Equivalent (non-GAAP)       
Net Interest Income (GAAP)$158,741  $147,132  $312,956  $299,344 
Plus tax-equivalent adjustment(1) 1,991   2,136   3,971   4,345 
Net interest income, fully tax-equivalent (non-GAAP)$160,732  $149,268  $316,927  $303,689 
        
Average earning assets$17,331,435  $18,523,552  $17,464,253  $18,458,462 
        
Annualized net interest margin (GAAP) 3.68%  3.19%  3.60%  3.27%
Annualized net interest margin, fully tax-equivalent (non-GAAP) 3.73   3.23   3.65   3.32 
Net purchase accounting discount amortization on loans included in annualized net interest margin 0.01   0.03   0.02   0.02 
        
(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.
(2) Tax effect is calculated based on the respective periods’ year-to-date effective tax rate excluding the impact of discrete items.


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 For the Quarter Ended
June 30,		 For the Six Months Ended
June 30,
 2024   2023   2024   2023 
Reconciliation of Adjusted Efficiency Ratio, Fully Tax-Equivalent (non-GAAP)       
Net interest income (GAAP)$158,741  $147,132  $312,956  $299,344 
Tax-equivalent adjustment(1) 1,991   2,136   3,971   4,345 
Fully tax-equivalent net interest income 160,732   149,268   316,927   303,689 
Noninterest income (GAAP) 18,207   32,493   45,870   62,492 
Securities (gains)/losses, net 10,111   314   10,053   1,418 
Unrealized (gain)/loss on equity securities, net (133)  41   (228)  (152)
Adjusted revenue (non-GAAP)$188,917  $182,116  $372,622  $367,447 
        
Total noninterest expenses (GAAP)$116,246  $109,446  $229,841  $220,489 
Less:       
Core deposit intangibles amortization 1,421   1,715   2,913   3,503 
Partnership investment in tax credit projects 222   154   716   692 
(Gain)/loss on sales/valuation of assets, net 193   (3,372)  407   (2,257)
Acquisition, integration and restructuring costs 5,973   1,892   7,348   3,565 
FDIC special assessment (631)  —   1,418   — 
Core expenses (non-GAAP)$109,068  $109,057  $217,039  $214,986 
        
Efficiency ratio (GAAP) 65.70%  60.93%  64.05%  60.94%
Adjusted efficiency ratio, fully tax-equivalent (non-GAAP) 57.73%  59.88%  58.25%  58.51%
        
Reconciliation of Annualized Ratio of Core Expenses to Average Assets (non-GAAP)       
Total noninterest expenses (GAAP)$116,246  $109,446  $229,841  $220,489 
Core expenses (non-GAAP) 109,068   109,057   217,039   214,986 
        
Average assets$19,043,362  $20,221,511  $19,170,002  $20,170,044 
Total noninterest expenses to average assets (GAAP) 2.46%  2.17%  2.41%  2.20%
Core expenses to average assets (non-GAAP) 2.30%  2.16%  2.28%  2.15%
        
Acquisition, integration and restructuring costs       
Salaries and employee benefits$462  $93  $631  $167 
Occupancy —   —   —   — 
Furniture and equipment 53   —   53   — 
Professional fees 5,385   1,068   6,316   2,002 
Advertising —   222   —   344 
Other noninterest expenses 73   509   348   1,052 
Total acquisition, integration and restructuring costs$5,973  $1,892  $7,348  $3,565 
        
(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.       


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 For the Quarter Ended
June 30,		 For the Six Months Ended
June 30,
  2024   2023   2024   2023 
Reconciliation of Adjusted Earnings (non-GAAP)       
Net income/(loss)$39,742  $49,416  $91,449  $102,192 
(Gain)/loss from sale of securities 10,111   314   10,053   1,418 
(Gain)/loss on sales/valuation of assets, net 193   (3,372)  407   (2,257)
Acquisition, integration and restructuring costs 5,973   1,892   7,348   3,565 
FDIC special assessment (631)  —   1,418   — 
Total adjustments 15,646   (1,166)  19,226   2,726 
Tax effect of adjustments(2) (3,739)  276   (4,633)  (646)
Adjusted earnings$51,649  $48,526  $106,042  $104,272 
        
Preferred dividends (2,012)  (2,012)  (4,025)  (4,025)
Adjusted earnings available to common stockholders$49,637  $46,514  $102,017  $100,247 
        
Plus core deposit intangibles amortization, net of tax(2) 1,081   1,309   2,211   2,673 
Earnings available to common stockholders excluding intangible amortization (non-GAAP)$50,718  $47,823  $104,228  $102,920 
        
Reconciliation of Adjusted Annualized Return on Average Assets       
Average assets$19,043,362  $20,221,511  $19,170,002  $20,170,044 
Adjusted annualized return on average assets (non-GAAP) 1.09%  0.96%  1.11%  1.04%
        
Reconciliation of Adjusted Annualized Return on Average Common Equity       
Average common stockholders' equity (GAAP)$1,863,236  $1,727,013  $1,848,098  $1,691,633 
Adjusted annualized return on average common equity (non-GAAP) 10.71%  10.80%  11.10%  11.95%
        
Reconciliation of Adjusted Annualized Return on Average Tangible Common Equity       
Average tangible common equity (non-GAAP)$1,271,046  $1,128,527  $1,255,180  $1,092,273 
Adjusted annualized return on average tangible common equity (non-GAAP) 16.05%  17.00%  16.70%  19.00%
        
Reconciliation of Adjusted Diluted Earnings Per Common Share       
Weighted average shares outstanding-diluted 43,060,354   42,757,603   43,001,157   42,753,197 
Adjusted diluted earnings per common share$1.15  $1.09  $2.37  $2.34 
        
(2) Tax effect is calculated based on the respective periods’ year-to-date effective tax rate excluding the impact of discrete items.

FAQ

What were HTLF's net earnings for Q2 2024?

HTLF reported net earnings of $37.7 million or $0.88 per share for Q2 2024.

How much did HTLF's adjusted earnings increase in Q2 2024?

Adjusted earnings rose to $49.6 million or $1.15 per share in Q2 2024.

What was the tangible common equity ratio for HTLF in Q2 2024?

The tangible common equity ratio improved to 7.28% in Q2 2024.

How much did HTLF's net interest margin improve in Q2 2024?

The net interest margin improved to 3.73% in Q2 2024 from 3.57% in Q1.

What was the impact of the Rocky Mountain Bank sale on HTLF?

The sale of Rocky Mountain Bank branches, expected to yield a $30 million gain, was closed in mid-July.

How did HTLF's noninterest income change in Q2 2024?

HTLF's noninterest income decreased by $14.3 million or 44% in Q2 2024.

What were the acquisition costs for HTLF in Q2 2024?

Acquisition, integration, and restructuring costs totaled $6.0 million in Q2 2024.

What were HTLF's total assets at the end of Q2 2024?

HTLF's total assets were $18.81 billion at the end of Q2 2024.

How much did HTLF's net income decrease compared to Q2 2023?

Net income decreased by $9.7 million or 20% compared to Q2 2023.

What was HTLF's net interest income for Q2 2024?

HTLF's net interest income for Q2 2024 was $158.7 million.

Stock HTLF logo
Heartland Financial USA, Inc.

NASDAQ:HTLF

HTLF Rankings

#1726 Ranked by Market Cap
#1447 Ranked by Dividends

HTLF Latest News

Oct 29, 2024
Heartland Financial USA, Inc. ("HTLF") Reports Quarterly Results as of September 30, 2024
Oct 24, 2024
Heartland Financial USA, Inc. (“HTLF”) Announces Common Stock and Series E Preferred Stock Dividends
Jul 25, 2024
Heartland Financial USA, Inc. (“HTLF”) Announces Common Stock and Series E Preferred Stock Dividends
Apr 29, 2024
UMB Announces Agreement to Acquire Heartland Financial
Apr 29, 2024
UMB Announces Agreement to Acquire Heartland Financial

HTLF Stock Data

2.90B
42.10M
1.75%
82.29%
1.42%
Banks - Regional
State Commercial Banks
Link
United States of America
DENVER