Old National's 2nd Quarter Results Supported by Strong Deposit Franchise, Ample Capital, Stable Credit and Expense Discipline

Rhea-AI Summary

Old National Bancorp (NASDAQ: ONB) reports 2Q23 net income applicable to common shares of $151.0 million, diluted EPS of $0.52; $156.3 million and $0.54 on an adjusted1 basis, respectively. The CEO highlights a 4% increase in total deposits, strong liquidity position, disciplined expense management, and strong credit metrics. Net interest income was $388.0 million, NIM was 3.60%, PPNR was $223.0 million, and efficiency ratio was 51.2%. Total deposits were $36.2 billion, up 3.8%, and total loans were $32.5 billion, up 2.2%. Provision for credit losses was $14.8 million, and net charge-offs were $10.1 million. Return on average tangible common equity was 21.4%. Old National continues to recover from the Louisville tragedy and expresses gratitude for the support received.

Positive

• Strong net income and EPS figures for the 2Q23
• 4% increase in total deposits, indicating growth in the deposit franchise
• Disciplined expense management and strong credit metrics
• Net interest income of $388.0 million and NIM of 3.60%
• Positive return on average tangible common equity of 21.4%
• Continuing recovery from the Louisville tragedy and gratitude for support received

Negative

• None.

EVANSVILLE, Ind., July 25, 2023 (GLOBE NEWSWIRE) --

Old National Bancorp (NASDAQ: ONB) reports 2Q23 net income applicable to common shares of $151.0 million, diluted EPS of $0.52; $156.3 million and $0.54 on an adjusted1 basis, respectively.

CEO COMMENTARY:

"The strength of Old National’s deposit franchise was evident once again with a nearly 4% quarterly increase in total deposits that bolstered our already strong liquidity position," said CEO Jim Ryan. "In addition, Old National continues to be well capitalized with disciplined expense management and strong credit metrics as we execute on our growth strategy and continue to serve our clients and communities with passion, strength and stability."

SECOND QUARTER HIGHLIGHTS²:

Net Income	Net income applicable to common shares of $151.0 million; adjusted net income applicable to common shares1 of $156.3 million
	Earnings per diluted common share ("EPS") of $0.52; adjusted EPS1 of $0.54
Net Interest Income/NIM	Net interest income on a fully taxable equivalent basis1 of $388.0 million
	Net interest margin on a fully taxable equivalent basis1 ("NIM") of 3.60%, down 9 basis points ("bps")
Operating Performance	Pre-provision net revenue1 (“PPNR”) of $223.0 million; adjusted PPNR1 of $229.0 million
	Noninterest expense of $246.6 million; adjusted noninterest expense1 of $240.6 million
	Efficiency ratio1 of 51.2%; adjusted efficiency ratio1 of 49.4%
Deposits and Funding	Period-end total deposits of $36.2 billion, up 3.8%; core deposits up 2.4%
	Granular low-cost deposit franchise; total deposit costs of 115 bps and a cycle to date (2Q22-2Q23) total deposit beta of 23% (interest-bearing deposit beta of 33%)
Loans and Credit Quality	End-of-period total loans3 of $32.5 billion, up 2.2%
	Provision for credit losses4 ("provision") of $14.8 million
	Net charge-offs of $10.1 million, or 13 bps of average loans; 6 bps excluding purchased credit deteriorated ("PCD") loans that had an allowance at acquisition
	30+ day delinquencies of 0.12% and non-performing loans of 0.91% of total loans
Return Profile & Capital	Return on average tangible common equity1 of 21.4%; adjusted return on average tangible common equity1 of 22.1%
Notable Items	$3.4 million of Louisville expenses5
	$2.4 million of merger-related charges
	$0.2 million of property optimization charges

_{¹ Non-GAAP financial measure that management believes is useful in evaluating the financial results of the Company – refer to the Non-GAAP reconciliations contained in this release ² Comparisons are on a linked-quarter basis, unless otherwise noted ³ Includes loans held for sale     
⁴ Includes the provision for unfunded commitments     ⁵ Includes expenses related to the tragic April 10 event at our downtown Louisville location      ⁶ Uninsured and uncollateralized deposits include the estimate of Old National Bank federally uninsured deposits for regulatory purposes, as adjusted for $1.5 billion of affiliate deposits and $4.2 billion of collateralized or otherwise insured deposits}

LOUISVILLE UPDATE
Our Old National Bancorp ("Old National") family continues to recover and heal from the Louisville tragedy on April 10 that claimed the lives of five of our team members and impacted many others. More than three months later, our ONB family continues to do our best to love, care and support one another. Additionally, in June, our downtown Louisville team began serving clients at a new location: 400 West Market Street in the heart of downtown Louisville. Once again, Old National wants to say thank you to the countless individuals and organizations who have cared for and supported our family during this challenging time.

RESULTS OF OPERATIONS
Old National reported second quarter 2023 net income applicable to common shares of $151.0 million, or $0.52 per diluted common share.

Included in the second quarter were pre-tax charges of $3.4 million for Louisville expenses⁵, $2.4 million related to the February 15, 2022 merger with First Midwest Bancorp, Inc. ("First Midwest") and $0.2 million for property optimization. Excluding these transactions from the current quarter, adjusted net income was $156.3 million, or $0.54 per diluted common share.

DEPOSITS AND FUNDING
Growth in low-cost deposits including normal seasonal patterns in public funds.

• Period-end total deposits were $36.2 billion at June 30, 2023, up 3.8%; core deposits increased 2.4%.
  • Reflect continuing effective competition for new client relationships.
  • Include normal seasonal patterns in public funds.
• On average, total deposits for the second quarter were $35.1 billion, an increase of 0.6%.
• Granular low-cost deposit franchise; total deposit costs of 115 bps and a cycle to date total deposit beta of 23% (interest-bearing deposit beta of 33%).
• Deposits that were either insured or collateralized⁶ at June 30, 2023 were more than 70% of total deposits.
• A loan to deposit ratio of 90% at June 30, 2023, combined with existing funding sources provides strong liquidity.

LOANS
Broad-based disciplined commercial loan growth.

• Period-end total loans³ were $32.5 billion at June 30, 2023, up 2.2% from March 31, 2023.
• Total commercial loan production in the second quarter was $1.9 billion; period-end commercial pipeline totaled $3.1 billion, down from $5.4 billion at March 31, 2023.
• Average total loans in the second quarter were $32.3 billion, an increase of $985.0 million from the first quarter of 2023.

CREDIT QUALITY
Strong credit quality continues to be a hallmark of Old National.

• Provision⁴ expense in the second quarter of 2023 was $14.8 million, compared to $13.4 million in the first quarter of 2023, reflecting loan and unfunded commitment growth, as well as economic factors.
• Net charge-offs in the second quarter were $10.1 million, or 13 bps of average loans compared to net charge-offs of 21 bps of average loans in the first quarter of 2023.
  • Excluding PCD loans that had an allowance for credit losses established at acquisition, net charge-offs to average loans were 6 bps for the second quarter and 5 bps for the first quarter of 2023.
• 30+ day delinquencies as a percentage of loans were 0.12% at the end of the second quarter of 2023, compared to 0.14% at the end of the first quarter of 2023.
• Non-performing loans as a percentage of total loans were 0.91% compared to 0.74% for the first quarter of 2023, up due primarily to migration of PCD loans.
• Loans acquired from previous acquisitions were recorded at fair value at the acquisition date. As of June 30, 2023, the remaining discount on these acquired loans was $90 million.
• The allowance for credit losses, including the allowance for credit losses on unfunded commitments, stood at $337.6 million, or 1.04% of total loans at June 30, 2023, compared to $332.9 million, or 1.05% of total loans at March 31, 2023.

NET INTEREST INCOME AND MARGIN
Growth in net interest income; margin compression reflective of the rate environment.

• Net interest income on a fully taxable equivalent basis increased to $388.0 million in the second quarter of 2023 compared to $387.2 million in the first quarter of 2023, driven by loan growth, the higher rate environment and more days in the quarter, which were partly offset by higher funding costs and lower accretion income on loans.
• Net interest margin on a fully taxable equivalent basis decreased 9 bps to 3.60% compared to the first quarter of 2023.
• Accretion income on loans and borrowings was $6.6 million, or 6 bps of net interest margin, in the second quarter of 2023 compared to $7.9 million, or 8 bps of net interest margin, in the first quarter of 2023.
• Cost of total deposits was 1.15%, increasing 43 bps and the cost of total interest-bearing deposits increased       57 bps to 1.66% in the second quarter of 2023.

NONINTEREST INCOME
Higher bank fees, mortgage banking revenue and other income.

• Total noninterest income for the second quarter of 2023 was $81.6 million.
• Excluding realized debt securities gains/losses for both periods, adjusted noninterest income for the second quarter was up 8.8% compared to the first quarter of 2023, driven by higher service charges on deposit accounts, debit card and ATM fees, mortgage banking revenue, company-owned life insurance and other income.

NONINTEREST EXPENSE
Disciplined expense management.

• Noninterest expense for the second quarter of 2023 was $246.6 million and included $3.4 million of Louisville expenses⁵, $2.4 million of merger-related charges and $0.2 million for property optimization.
• Excluding these items, adjusted noninterest expense for the second quarter was $240.6 million, compared to $234.8 million for the first quarter of 2023; increase was driven by higher salary and employee benefits resulting from performance-driven incentive accruals.
• The efficiency ratio¹ was 51.2%, while the adjusted efficiency ratio¹ was 49.4% for the second quarter of 2023 compared to 52.8% and 48.8%, respectively, for the first quarter of 2023.

INCOME TAXES

• Income tax expense in the second quarter of 2023 was $47.4 million, resulting in an effective tax rate of 23.4% compared to 22.0% in the first quarter of 2023. On an adjusted fully taxable equivalent ("FTE") basis, the effective tax rate was 25.2% in the second quarter compared to 24.1% in the first quarter.
• Income tax expense included $3.1 million of tax credit benefit.

CAPITAL
Capital ratios remain strong.

• All regulatory capital ratios grew in the quarter with preliminary total risk-based capital up 18 bps to 12.14% and preliminary regulatory Tier 1 capital up 15 bps to 10.79%, driven by retained earnings, partly offset by loan growth and merger-related charges.
• Tangible common equity to tangible assets was 6.33% at the end of the second quarter compared to 6.37% in the first quarter of 2023.

CONFERENCE CALL AND WEBCAST
Old National will host a conference call and live webcast at 9:00 a.m. Central Time on Tuesday, July 25, 2023, to review second quarter financial results. The live audio webcast link and corresponding presentation slides will be available on the Company’s Investor Relations web page at oldnational.com and will be archived there for 12 months. To listen to the live conference call, dial U.S. (888) 300-3045 or International (646) 568-1027, Access code 5258325. A replay of the call will also be available from approximately noon Central Time on July 25, 2023 through August 8, 2023. To access the replay, dial U.S. (800) 770-2030 or International (647) 362-9199, Access code 5258325.

ABOUT OLD NATIONAL
Old National Bancorp (NASDAQ: ONB) is the holding company of Old National Bank, which is the sixth largest commercial bank headquartered in the Midwest. With approximately $48 billion of assets and $29 billion of assets under management, Old National ranks among the top 30 banking companies headquartered in the U.S. Tracing our roots to 1834, Old National Bank has focused on community banking by building long-term, highly valued partnerships with clients and in the communities it serves. In addition to providing extensive services in retail and commercial banking, Old National offers comprehensive wealth management, investment, and capital market services. For more information and financial data, please visit Investor Relations at oldnational.com.

USE OF NON-GAAP FINANCIAL MEASURES
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. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in the tables at the end of this release.

The Company presents EPS, the efficiency ratio, return on average common equity, and return on average tangible common equity, all adjusted for certain notable items. These items include the current expected credit loss ("CECL") Day 1 non-PCD provision expense, Louisville expenses⁵, merger-related charges associated with completed acquisitions, gain on sale of health savings accounts, property optimization charges and gains/losses on sales of debt securities. Management believes excluding these items from EPS, the efficiency ratio, 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 items do not pertain to its core business operations and their exclusion may facilitate better comparability between periods. Management believes that excluding merger-related charges and the CECL Day 1 non-PCD provision expense 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 items from these metrics may enhance comparability for peer comparison purposes.

Income tax expense, provision for credit losses, and the certain notable items listed above are excluded from the calculation of pre-provision net revenues, adjusted due to the fluctuation in income before income tax and the level of provision for credit losses required. Management believes pre-provision net revenues, adjusted may be useful in assessing the Company's underlying operating performance and their exclusion may facilitate better comparability between periods and for peer comparison purposes.

The Company presents adjusted noninterest expense, which excludes Louisville expenses⁵, merger-related charges and property optimization charges, as well as adjusted noninterest income, which excludes the gain on sale of health savings accounts and gains/losses on sales of debt securities. Management believes that excluding these items from noninterest expense and noninterest income 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 21%. Management believes that it is standard practice in the banking industry to present net interest income and net interest margin on a fully tax-equivalent basis and that it may enhance comparability for peer comparison purposes.

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.

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.

FORWARD-LOOKING STATEMENTS
This communication contains certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Act”), notwithstanding that such statements are not specifically identified as such. In addition, certain statements may be contained in our future filings with the SEC, in press releases, and in oral and written statements made by us or with our approval that are not statements of historical fact and constitute forward‐looking statements within the meaning of the Act. These statements include, but are not limited to, descriptions of Old National’s financial condition, results of operations, asset and credit quality trends, profitability and business plans or opportunities. Forward-looking statements can be identified by the use of the words "anticipate," "believe," "contemplate," "could," "estimate," "expect," "intend," "may," "outlook," "plan," "should," and "will," and other words of similar meaning. These forward-looking statements express management’s current expectations or forecasts of future events and, by their nature, are subject to risks and uncertainties. There are a number of factors that could cause actual results or outcomes to differ materially from those in such statements. Factors that might cause such a difference include, but are not limited to: competition; government legislation, regulations and policies; the ability of Old National to execute its business plan; unanticipated changes in our liquidity position, including but not limited to changes in our access to sources of liquidity and capital to address our liquidity needs; changes in economic conditions and economic and business uncertainty which could materially impact credit quality trends and the ability to generate loans and gather deposits; inflation and governmental responses to inflation, including increasing interest rates; market, economic, operational, liquidity, credit, and interest rate risks associated with our business; our ability to successfully manage our credit risk and the sufficiency of our allowance for credit losses; uncertainty about the discontinued use of LIBOR and the transition to an alternative rate; the potential impact of future business combinations on our performance and financial condition, including our ability to successfully integrate the businesses and the success of revenue-generating and cost reduction initiatives; failure or circumvention of our internal controls; operational risks or risk management failures by us or critical third parties, including without limitation with respect to data processing, information systems, cybersecurity, technological changes, vendor issues, business interruption, and fraud risks; significant changes in accounting, tax or regulatory practices or requirements; new legal obligations or liabilities; disruptive technologies in payment systems and other services traditionally provided by banks; failure or disruption of our information systems; computer hacking and other cybersecurity threats; the effects of climate change on Old National and its customers, borrowers, or service providers; political and economic uncertainty and instability; the impacts of pandemics, epidemics and other infectious disease outbreaks; other matters discussed in this communication; and other factors identified in our Annual Report on Form 10-K for the year ended December 31, 2022 and other filings with the Securities and Exchange Commission. These forward-looking statements are made only as of the date of this communication and are not guarantees of future results, performance or outcomes, and Old National does not undertake an obligation to update these forward-looking statements to reflect events or conditions after the date of this communication.

CONTACTS:
Media: Kathy Schoettlin		Investors: Lynell Walton
(812) 465-7269		(812) 464-1366
Kathy.Schoettlin@oldnational.com		Lynell.Walton@oldnational.com

Financial Highlights (unaudited)
($ and shares in thousands, except per share data)
	Three Months Ended																Six Months Ended
	June 30,			March 31,			December 31,			September 30,			June 30,				June 30,			June 30,
	2023			2023			2022			2022			2022				2023			2022
Income Statement
Net interest income	$	382,171		$	381,488		$	391,090		$	376,589		$	337,472			$	763,659		$	560,257
FTE adjustment1,4		5,825			5,666			5,378			4,950			4,314				11,491			8,086
Net interest income - tax equivalent basis4		387,996			387,154			396,468			381,539			341,786				775,150			568,343
Provision for credit losses2		14,787			13,437			11,408			15,490			9,165				28,224			117,901
Noninterest income		81,629			70,681			165,037			80,385			89,117				152,310			154,357
Noninterest expense2		246,584			250,711			282,675			262,444			277,475				497,295			493,064
Net income (loss) available to common shareholders	$	151,003		$	142,566		$	196,701		$	136,119		$	110,952			$	293,569		$	81,349
Per Common Share Data
Weighted average diluted shares		291,266			292,756			293,131			292,483			291,881				291,870			260,253
EPS, diluted	$	0.52		$	0.49		$	0.67		$	0.47		$	0.38			$	1.01		$	0.31
Cash dividends		0.14			0.14			0.14			0.14			0.14				0.28			0.28
Dividend payout ratio3		27	%		29	%		21	%		30	%		37	%			28	%		90	%
Book value	$	17.25		$	17.24		$	16.68		$	16.05		$	16.51			$	17.25		$	16.51
Stock price		13.94			14.42			17.98			16.47			14.79				13.94			14.79
Tangible book value4		10.03			9.98			9.42			8.75			9.23				10.03			9.23
Performance Ratios
ROAA		1.29	%		1.25	%		1.74	%		1.22	%		1.01	%			1.27	%		0.43	%
ROAE		12.0	%		11.6	%		16.8	%		11.1	%		9.1	%			11.8	%		3.6	%
ROATCE4		21.4	%		21.0	%		31.5	%		20.5	%		16.9	%			21.2	%		6.8	%
NIM (FTE)		3.60	%		3.69	%		3.85	%		3.71	%		3.33	%			3.65	%		3.13	%
Efficiency ratio4		51.2	%		52.8	%		49.1	%		55.3	%		62.7	%			52.0	%		66.6	%
Efficiency ratio (prior presentation)5	N/A			N/A			N/A				56.2	%		62.7	%		N/A				68.1	%
NCOs to average loans		0.13	%		0.21	%		0.05	%		0.10	%		0.02	%			0.17	%		0.04	%
ACL on loans to EOP loans		0.93	%		0.94	%		0.98	%		0.99	%		0.97	%			0.93	%		0.97	%
ACL6 to EOP loans		1.04	%		1.05	%		1.08	%		1.08	%		1.05	%			1.04	%		1.05	%
NPLs to EOP loans		0.91	%		0.74	%		0.81	%		0.81	%		0.78	%			0.91	%		0.78	%
Balance Sheet (EOP)
Total loans	$	32,432,473		$	31,822,374		$	31,123,641		$	30,528,933		$	29,553,648			$	32,432,473		$	29,553,648
Total assets		48,496,755			47,842,644			46,763,372			46,215,526			45,748,355				48,496,755			45,748,355
Total deposits		36,231,315			34,917,792			35,000,830			36,053,663			35,538,975				36,231,315			35,538,975
Total borrowed funds		6,034,008			6,740,454			5,586,314			4,264,750			4,384,411				6,034,008			4,384,411
Total shareholders' equity		5,292,095			5,277,426			5,128,595			4,943,383			5,078,783				5,292,095			5,078,783
Capital Ratios
Risk-based capital ratios (EOP):
Tier 1 common equity		10.14	%		9.98	%		10.03	%		9.88	%		9.90	%			10.14	%		9.90	%
Tier 1 capital		10.79	%		10.64	%		10.71	%		10.58	%		10.63	%			10.79	%		10.63	%
Total capital		12.14	%		11.96	%		12.02	%		11.84	%		12.03	%			12.14	%		12.03	%
Leverage ratio (average assets)		8.59	%		8.53	%		8.52	%		8.26	%		8.19	%			8.59	%		8.19	%
Equity to assets (averages)4		10.96	%		11.00	%		10.70	%		11.18	%		11.22	%			10.98	%		11.57	%
TCE to TA4		6.33	%		6.37	%		6.18	%		5.82	%		6.20	%			6.33	%		6.20	%
Nonfinancial Data
Full-time equivalent employees		4,021			4,023			3,967			4,008			4,196				4,021			4,196
Banking centers		256			256			263			263			266				256			266
1 Calculated using the federal statutory tax rate in effect of 21% for all periods.
2 Provision for unfunded commitments is included in the provision for credit losses. The reclassification of the provision for unfunded commitments out of other expense as a component of noninterest expense was made to amounts prior to December 31, 2022 to conform to the current period presentation.
3 Cash dividends per common share divided by net income per common share (basic).
4 Represents a non-GAAP financial measure. Refer the "Non-GAAP Measures" table for reconciliations to GAAP financial measures.     June 30, 2023 capital ratios are preliminary.
5 Presented as calculated prior to December 31, 2022, which included the provision for unfunded commitments in noninterest expense. Management believes that removing the provision for unfunded commitments from this metric enhances comparability for peer comparison purposes.
6 Includes the allowance for credit losses on loans and unfunded commitments.
FTE - Fully taxable equivalent basis ROAA - Return on average assets ROAE - Return on average equity ROATCE - Return on average tangible common equity
NCOs - Net Charge-offs ALL - Allowance for loan losses ACL - Allowance for Credit Losses
EOP - End of period actual balances NPLs - Non-performing Loans TCE - Tangible common equity TA - Tangible assets

Income Statement (unaudited)
($ and shares in thousands, except per share data)
	Three Months Ended																Six Months Ended
	June 30,			March 31,			December 31,			September 30,			June 30,				June 30,			June 30,
	2023			2023			2022			2022			2022				2023			2022
Interest income	$	544,902		$	495,649		$	457,821		$	406,518		$	354,358			$	1,040,551		$	589,863
Less: interest expense		162,731			114,161			66,731			29,929			16,886				276,892			29,606
Net interest income		382,171			381,488			391,090			376,589			337,472				763,659			560,257
Provision for credit losses1		14,787			13,437			11,408			15,490			9,165				28,224			117,901
Net interest income after provision for credit losses		367,384			368,051			379,682			361,099			328,307				735,435			442,356
Wealth and investment services fees		26,521			26,920			25,668			25,359			27,872				53,441			49,824
Service charges on deposit accounts		17,751			17,003			18,109			20,042			20,324				34,754			34,350
Debit card and ATM fees		10,653			9,982			10,798			10,608			11,222				20,635			18,821
Mortgage banking revenue		4,165			3,400			3,888			5,360			6,522				7,565			13,767
Capital markets income		6,173			6,939			5,377			8,906			7,261				13,112			11,703
Company-owned life insurance		4,698			3,186			3,108			3,361			4,571				7,884			8,095
Gain on sale of health savings accounts		—			—			90,673			—			—				—			—
Other income		11,651			8,467			7,589			6,921			11,430				20,118			17,540
Gains (losses) on sales of debt securities		17			(5,216	)		(173	)		(172	)		(85	)			(5,199	)		257
Total noninterest income		81,629			70,681			165,037			80,385			89,117				152,310			154,357
Salaries and employee benefits		135,810			137,364			142,459			147,203			161,817				273,174			285,964
Occupancy		26,085			28,282			26,488			26,418			26,496				54,367			47,515
Equipment		7,721			7,389			7,591			7,328			7,550				15,110			12,718
Marketing		9,833			9,417			8,508			10,361			9,119				19,250			13,395
Technology		20,056			19,202			19,951			20,269			25,883				39,258			44,645
Communication		4,232			4,461			4,159			5,392			5,878				8,693			9,295
Professional fees		6,397			6,732			6,360			6,559			6,336				13,129			26,127
FDIC assessment		9,624			10,404			5,809			6,249			4,699				20,028			7,274
Amortization of intangibles		6,060			6,186			6,787			7,089			7,170				12,246			11,981
Amortization of tax credit investments		2,762			2,761			5,258			2,662			1,525				5,523			3,041
Property optimization		242			1,317			26,818			—			—				1,559			—
Other expense1		17,762			17,196			22,487			22,914			21,002				34,958			31,109
Total noninterest expense		246,584			250,711			282,675			262,444			277,475				497,295			493,064
Income (loss) before income taxes		202,429			188,021			262,044			179,040			139,949				390,450			103,649
Income tax expense (benefit)		47,393			41,421			61,309			38,887			24,964				88,814			16,250
Net income (loss)	$	155,036		$	146,600		$	200,735		$	140,153		$	114,985			$	301,636		$	87,399
Preferred dividends		(4,033	)		(4,034	)		(4,034	)		(4,034	)		(4,033	)			(8,067	)		(6,050	)
Net income (loss) applicable to common shares	$	151,003		$	142,566		$	196,701		$	136,119		$	110,952			$	293,569		$	81,349
EPS, diluted	$	0.52		$	0.49		$	0.67		$	0.47		$	0.38			$	1.01		$	0.31
Weighted Average Common Shares Outstanding
Basic		290,559			291,088			291,012			290,961			290,862				290,822			259,108
Diluted		291,266			292,756			293,131			292,483			291,881				291,870			260,253
Common shares outstanding (EOP)		292,597			291,922			292,903			292,880			292,893				292,597			292,893
1 Provision for unfunded commitments is included in the provision for credit losses. The reclassification of the provision for unfunded commitments out of other expense as a component of noninterest expense was made to amounts prior to December 31, 2022 to conform to the current period presentation.

End of Period Balance Sheet (unaudited)
($ in thousands)
	June 30,			March 31,			December 31,			September 30,			June 30,
		2023			2023			2022			2022			2022
Assets
Cash and due from banks	$	473,023		$	386,879		$	453,432		$	466,846		$	455,620
Money market and other interest-earnings investments		724,863			727,056			274,980			334,765			342,344
Investments:
Treasury and government-sponsored agencies		2,309,285			2,236,413			2,195,175			2,186,551			2,461,173
Mortgage-backed securities		5,168,458			5,395,680			5,476,718			5,584,241			5,976,921
States and political subdivisions		1,760,725			1,785,072			1,827,164			1,829,561			1,839,333
Other securities		802,323			826,575			730,476			693,303			719,223
Total investments		10,040,791			10,243,740			10,229,533			10,293,656			10,996,650
Loans held for sale, at fair value		114,369			10,584			11,926			19,748			26,217
Loans:
Commercial		9,698,241			9,751,875			9,508,904			9,311,148			8,923,983
Commercial and agriculture real estate		13,450,209			12,908,380			12,457,070			12,227,888			11,796,503
Residential real estate		6,684,480			6,568,666			6,460,441			6,267,306			6,079,057
Consumer		2,599,543			2,593,453			2,697,226			2,722,591			2,754,105
Total loans		32,432,473			31,822,374			31,123,641			30,528,933			29,553,648
Allowance for credit losses on loans		(300,555	)		(298,711	)		(303,671	)		(302,254	)		(288,003	)
Premises and equipment, net		564,299			566,758			557,307			588,021			586,031
Operating lease right-of-use assets		184,700			183,687			189,714			187,626			192,196
Goodwill and other intangible assets		2,112,875			2,118,935			2,125,121			2,135,792			2,131,815
Company-owned life insurance		771,753			770,471			768,552			767,089			769,595
Other assets		1,378,164			1,310,871			1,332,837			1,195,304			982,242
Total assets	$	48,496,755		$	47,842,644		$	46,763,372		$	46,215,526		$	45,748,355
Liabilities and Equity
Noninterest-bearing demand deposits	$	10,532,838		$	10,995,083		$	11,930,798		$	12,400,077		$	12,388,379
Interest-bearing:
Checking and NOW accounts		7,654,202			7,903,520			8,340,955			8,963,014			8,473,510
Savings accounts		5,578,323			6,030,255			6,326,158			6,616,512			6,796,152
Money market accounts		7,200,288			5,867,239			5,389,139			5,602,729			5,373,318
Other time deposits		4,012,813			3,361,979			2,775,991			2,393,083			2,479,304
Total core deposits		34,978,464			34,158,076			34,763,041			35,975,415			35,510,663
Brokered deposits		1,252,851			759,716			237,789			78,248			28,312
Total deposits		36,231,315			34,917,792			35,000,830			36,053,663			35,538,975
Federal funds purchased and interbank borrowings		136,060			618,955			581,489			301,031			1,561
Securities sold under agreements to repurchase		311,447			393,018			432,804			438,053			476,173
Federal Home Loan Bank advances		4,771,183			4,981,612			3,829,018			2,804,617			3,283,963
Other borrowings		815,318			746,869			743,003			721,049			622,714
Total borrowed funds		6,034,008			6,740,454			5,586,314			4,264,750			4,384,411
Operating lease liabilities		206,178			205,249			211,964			207,725			215,188
Accrued expenses and other liabilities		733,159			701,723			835,669			746,005			530,998
Total liabilities		43,204,660			42,565,218			41,634,777			41,272,143			40,669,572
Preferred stock, common stock, surplus, and retained earnings		6,100,728			5,985,784			5,915,017			5,751,833			5,647,916
Accumulated other comprehensive income (loss), net of tax		(808,633	)		(708,358	)		(786,422	)		(808,450	)		(569,133	)
Total shareholders' equity		5,292,095			5,277,426			5,128,595			4,943,383			5,078,783
Total liabilities and shareholders' equity	$	48,496,755		$	47,842,644		$	46,763,372		$	46,215,526		$	45,748,355

Average Balance Sheet and Interest Rates (unaudited)
($ in thousands)
		Three Months Ended								Three Months Ended								Three Months Ended
		June 30, 2023								March 31, 2023								June 30, 2022
		Average			Income1/		Yield/			Average			Income1/		Yield/			Average			Income1/		Yield/
Earning Assets:		Balance			Expense		Rate			Balance			Expense		Rate			Balance			Expense		Rate
Money market and other interest-earning investments		$	724,601		$	8,966	4.96	%		$	497,953		$	3,098	2.52	%		$	1,088,005		$	1,830	0.67	%
Investments:
Treasury and government-sponsored agencies			2,222,269			19,355	3.48	%			2,197,426			16,531	3.01	%			2,487,717			11,818	1.90	%
Mortgage-backed securities			5,301,084			34,291	2.59	%			5,429,200			35,090	2.59	%			6,008,470			33,534	2.23	%
States and political subdivisions			1,768,897			14,396	3.26	%			1,808,316			14,690	3.25	%			1,834,189			14,571	3.18	%
Other securities			824,482			9,995	4.85	%			738,139			8,604	4.66	%			723,279			5,467	3.02	%
Total investments			10,116,732			78,037	3.09	%			10,173,081			74,915	2.95	%			11,053,655			65,390	2.37	%
Loans:2
Commercial			9,862,728			163,721	6.64	%			9,457,089			147,620	6.24	%			8,692,646			95,743	4.36	%
Commercial and agriculture real estate			13,164,390			199,287	6.06	%			12,654,366			179,475	5.67	%			11,547,958			113,545	3.89	%
Residential real estate loans			6,643,254			60,717	3.66	%			6,523,074			58,099	3.56	%			5,905,151			51,686	3.50	%
Consumer			2,585,493			39,999	6.21	%			2,636,350			38,108	5.86	%			2,715,923			30,478	4.50	%
Total loans			32,255,865			463,724	5.75	%			31,270,879			423,302	5.42	%			28,861,678			291,452	4.01	%
Total earning assets		$	43,097,198		$	550,727	5.11	%		$	41,941,913		$	501,315	4.79	%		$	41,003,338		$	358,672	3.48	%
Less: Allowance for credit losses on loans			(301,311	)							(304,393	)							(282,943	)
Non-earning Assets:
Cash and due from banks		$	418,972							$	437,872							$	277,283
Other assets			4,884,694								4,907,115								4,735,701
Total assets		$	48,099,553							$	46,982,507							$	45,733,379
Interest-Bearing Liabilities:
Checking and NOW accounts		$	7,881,863		$	24,358	1.24	%		$	7,988,579		$	19,359	0.98	%		$	8,445,683		$	1,786	0.08	%
Savings accounts			5,785,603			3,247	0.23	%			6,183,409			2,230	0.15	%			6,835,675			673	0.04	%
Money market accounts			6,084,963			35,358	2.33	%			5,641,288			20,010	1.44	%			5,317,300			1,027	0.08	%
Other time deposits			3,680,029			26,633	2.90	%			3,057,870			15,289	2.03	%			2,491,998			1,627	0.26	%
Total interest-bearing core deposits			23,432,458			89,596	1.53	%			22,871,146			56,888	1.01	%			23,090,656			5,113	0.09	%
Brokered deposits			948,397			11,378	4.81	%			500,530			5,705	4.62	%			7,447			74	0.00	%
Total interest-bearing deposits			24,380,855			100,974	1.66	%			23,371,676			62,593	1.09	%			23,098,103			5,187	0.09	%
Federal funds purchased and interbank borrowings			441,145			5,655	5.14	%			419,291			4,839	4.68	%			1,222			2	0.47	%
Securities sold under agreements to repurchase			340,178			900	1.06	%			412,819			779	0.77	%			466,885			85	0.07	%
Federal Home Loan Bank advances			5,283,728			45,088	3.42	%			4,273,343			37,996	3.61	%			3,053,423			6,925	0.91	%
Other borrowings			796,536			10,114	5.09	%			781,221			7,954	4.13	%			611,772			4,687	3.06	%
Total borrowed funds			6,861,587			61,757	3.61	%			5,886,674			51,568	3.55	%			4,133,302			11,699	1.14	%
Total interest-bearing liabilities		$	31,242,442		$	162,731	2.09	%		$	29,258,350		$	114,161	1.58	%		$	27,231,405		$	16,886	0.25	%
Noninterest-Bearing Liabilities and Shareholders' Equity
Demand deposits		$	10,741,646							$	11,526,267							$	12,714,946
Other liabilities			841,663								1,031,702								657,128
Shareholders' equity			5,273,802								5,166,188								5,129,900
Total liabilities and shareholders' equity		$	48,099,553							$	46,982,507							$	45,733,379
Net interest rate spread							3.02	%							3.21	%							3.23	%
Net interest margin (GAAP)							3.55	%							3.64	%							3.29	%
Net interest margin (FTE)3							3.60	%							3.69	%							3.33	%
FTE adjustment					$	5,825							$	5,666							$	4,314
1 Interest income is reflected on a FTE.
2 Includes loans held for sale.
3 Represents a non-GAAP financial measure. Refer the "Non-GAAP Measures" table for reconciliations to GAAP financial measures.

Average Balance Sheet and Interest Rates (unaudited)
($ in thousands)
		Six Months Ended								Six Months Ended
		June 30, 2023								June 30, 2022
		Average			Income1/		Yield/			Average			Income1/		Yield/
Earning Assets:		Balance			Expense		Rate			Balance			Expense		Rate
Money market and other interest-earning investments		$	611,903		$	12,064	3.98	%		$	1,211,518		$	2,138	0.36	%
Investments:
Treasury and government-sponsored agencies			2,209,916			35,886	3.25	%			2,342,401			20,038	1.71	%
Mortgage-backed securities			5,364,788			69,381	2.59	%			5,441,902			57,910	2.13	%
States and political subdivisions			1,788,498			29,086	3.25	%			1,786,684			28,208	3.16	%
Other securities			781,549			18,599	4.76	%			664,741			9,611	2.89	%
Total investments		$	10,144,751		$	152,952	3.02	%		$	10,235,728		$	115,767	2.26	%
Loans:2
Commercial			9,661,029			311,341	6.45	%			7,301,008			151,026	4.11	%
Commercial and agriculture real estate			12,910,787			378,762	5.87	%			10,156,292			190,952	3.74	%
Residential real estate loans			6,582,982			118,817	3.61	%			4,953,222			85,673	3.46	%
Consumer			2,611,295			78,106	6.03	%			2,411,976			52,393	4.38	%
Total loans			31,766,093			887,026	5.59	%			24,822,498			480,044	3.86	%
Total earning assets		$	42,522,747		$	1,052,042	4.95	%		$	36,269,744		$	597,949	3.29	%
Less: Allowance for credit losses on loans			(302,844	)							(225,876	)
Non-earning Assets:
Cash and due from banks		$	428,370							$	273,083
Other assets			4,895,843								4,111,637
Total assets		$	47,544,116							$	40,428,588
Interest-Bearing Liabilities:
Checking and NOW accounts		$	7,934,927		$	43,717	1.11	%		$	7,619,757		$	2,381	0.06	%
Savings accounts			5,983,407			5,477	0.18	%			6,073,081			1,262	0.04	%
Money market accounts			5,864,351			55,368	1.90	%			4,552,241			1,719	0.08	%
Other time deposits			3,370,668			41,922	2.51	%			2,120,638			2,945	0.28	%
Total interest-bearing core deposits			23,153,353			146,484	1.28	%			20,365,717			8,307	0.08	%
Brokered deposits			725,701			17,083	4.75	%			3,744			74	3.99	%
Total interest-bearing deposits			23,879,054			163,567	1.38	%			20,369,461			8,381	0.08	%
Federal funds purchased and interbank borrowings			430,278			10,494	4.92	%			1,168			2	0.25	%
Securities sold under agreements to repurchase			376,298			1,679	0.90	%			458,459			181	0.08	%
Federal Home Loan Bank advances			4,781,326			83,084	3.50	%			2,822,984			12,888	0.92	%
Other borrowings			788,921			18,068	4.62	%			522,599			8,154	3.12	%
Total borrowed funds			6,376,823			113,325	3.58	%			3,805,210			21,225	1.12	%
Total interest-bearing liabilities			30,255,877			276,892	1.85	%			24,174,671			29,606	0.25	%
Noninterest-Bearing Liabilities and Shareholders' Equity
Demand deposits		$	11,131,789							$	11,014,359
Other liabilities			936,158								562,882
Shareholders' equity			5,220,292								4,676,676
Total liabilities and shareholders' equity		$	47,544,116							$	40,428,588
Net interest rate spread							3.10	%							3.04	%
Net interest margin (GAAP)							3.59	%							3.09	%
Net interest margin (FTE)3							3.65	%							3.13	%
FTE adjustment					$	11,491							$	8,086
1 Interest income is reflected on a FTE.
2 Includes loans held for sale.
3 Represents a non-GAAP financial measure. Refer the "Non-GAAP Measures" table for reconciliations to GAAP financial measures.

Asset Quality (EOP) (unaudited)
($ in thousands)
	Three Months Ended																Six Months Ended
	June 30,			March 31,			December 31,			September 30,			June 30,				June 30,			June 30,
		2023			2023			2022			2022			2022				2023			2022
Allowance for credit losses:
Beginning allowance for credit losses on loans	$	298,711		$	303,671		$	302,254		$	288,003		$	280,507			$	303,671		$	107,341
Allowance established for acquired PCD loans		—			—			—			10,558			—				—			78,531
Provision for credit losses on loans		11,936			11,469			5,389			11,288			9,254				23,405			106,663
Gross charge-offs		(14,331	)		(18,180	)		(7,081	)		(11,440	)		(4,096	)			(32,511	)		(8,760	)
Gross recoveries		4,239			1,751			3,109			3,845			2,338				5,990			4,228
NCOs		(10,092	)		(16,429	)		(3,972	)		(7,595	)		(1,758	)			(26,521	)		(4,532	)
Ending allowance for credit losses on loans	$	300,555		$	298,711		$	303,671		$	302,254		$	288,003			$	300,555		$	288,003
Beginning allowance for credit losses on unfunded commitments	$	34,156		$	32,188		$	26,169		$	21,966		$	22,046			$	32,188		$	10,879
Provision (release) for credit losses on unfunded commitments		2,851			1,968			6,019			4,203			(80	)			4,819			11,087
Ending allowance for credit losses on unfunded commitments	$	37,007		$	34,156		$	32,188		$	26,169		$	21,966			$	37,007		$	21,966
Allowance for credit losses	$	337,562		$	332,867		$	335,859		$	328,423		$	309,969			$	337,562		$	309,969
Provision for credit losses on loans	$	11,936		$	11,469		$	5,389		$	11,288		$	9,254			$	23,405		$	106,663
Provision (release) for credit losses on unfunded commitments1		2,851			1,968			6,019			4,203			(80	)			4,819			11,087
Provision for credit losses1	$	14,787		$	13,437		$	11,408		$	15,491		$	9,174			$	28,224		$	117,750
NCOs / average loans2		0.13	%		0.21	%		0.05	%		0.10	%		0.02	%			0.17	%		0.04	%
Average loans2	$	32,251,242		$	31,267,836		$	30,732,473		$	29,890,008		$	28,847,003			$	31,762,256		$	24,808,593
EOP loans2		32,432,473			31,822,374			31,123,641			30,528,933			29,553,648				32,432,473			29,553,648
ACL on loans / EOP loans2		0.93	%		0.94	%		0.98	%		0.99	%		0.97	%			0.93	%		0.97	%
ACL / EOP loans2		1.04	%		1.05	%		1.08	%		1.08	%		1.05	%			1.04	%		1.05	%
Underperforming Assets:
Loans 90 days and over (still accruing)	$	303		$	1,231		$	2,650		$	767		$	882			$	303		$	882
NPLs:
Nonaccrual loans3,4		295,509			234,337			238,178			233,659			214,924				295,509			214,924
TDRs still accruing4	N/A			N/A				15,313			13,674			15,665			N/A				15,665
Total NPLs		295,509			234,337			253,491			247,333			230,589				295,509			230,589
Foreclosed assets		9,824			10,817			10,845			11,967			12,618				9,824			12,618
Total underperforming assets	$	305,636		$	246,385		$	266,986		$	260,067		$	244,089			$	305,636		$	244,089
Classified and Criticized Assets:
Nonaccrual loans3	$	295,509		$	234,337		$	238,178		$	233,659		$	214,924			$	295,509		$	214,924
Substandard loans (still accruing)		524,709			570,229			504,657			476,724			490,566				524,709			490,566
Loans 90 days and over (still accruing)		303			1,231			2,650			767			882				303			882
Total classified loans - "problem loans"		820,521			805,797			745,485			711,150			706,372				820,521			706,372
Other classified assets		40,942			26,441			24,735			24,773			25,004				40,942			25,004
Criticized loans - "special mention loans"		614,547			593,307			636,069			549,994			452,835				614,547			452,835
Total classified and criticized assets	$	1,476,010		$	1,425,545		$	1,406,289		$	1,285,917		$	1,184,211			$	1,476,010		$	1,184,211
Loans 30-89 days past due	$	39,748		$	42,071		$	55,522		$	65,632		$	48,889			$	39,748		$	48,889
NPLs / EOP loans2		0.91	%		0.74	%		0.81	%		0.81	%		0.78	%			0.91	%		0.78	%
ACL to NPLs		114	%		142	%		132	%		133	%		134	%			114	%		134	%
Under-performing assets/EOP loans2		0.94	%		0.77	%		0.86	%		0.85	%		0.83	%			0.94	%		0.83	%
Under-performing assets/EOP assets		0.63	%		0.51	%		0.57	%		0.56	%		0.53	%			0.63	%		0.53	%
30+ day delinquencies/EOP loans2		0.12	%		0.14	%		0.19	%		0.22	%		0.17	%			0.12	%		0.17	%
1 Excludes $0.2 million of expense to establish an allowance on held-to-maturity securities during the first quarter of 2022. Provision for unfunded commitments is included in the provision for credit losses. The reclassification of the provision for unfunded commitments out of other expense as a component of noninterest expense was made to amounts prior to December 31, 2022 to conform to the current period presentation.
2 Excludes loans held for sale.
3 Includes non-accruing TDRs totaling $24.0 million at December 31, 2022, $23.8 million at September 30, 2022, and $24.3 million at June 30, 2022.
4 As a result of accounting guidance adopted in 2023, the TDR classification is no longer applicable subsequent to December 31, 2022.
PCD - Purchased credit deteriorated TDR - Troubled debt restructuring

                

Non-GAAP Measures (unaudited)
($ and shares in thousands, except per share data)
	Three Months Ended																Six Months Ended
	June 30,			March 31,			December 31,			September 30,			June 30,				June 30,			June 30,
		2023			2023			2022			2022			2022				2023			2022
Earnings Per Share:
Net income applicable to common shares	$	151,003		$	142,566		$	196,701		$	136,119		$	110,952			$	293,569		$	81,349
Adjustments:
Louisville expenses		3,361			—			—			—			—				3,361			—
Tax effect1		(392	)		—			—			—			—				(392	)		—
Louisville expenses, net		2,969			—			—			—			—				2,969			—
Merger-related charges2		2,372			14,558			20,314			22,743			36,585				16,930			88,884
Tax effect1		(277	)		(3,172	)		(5,160	)		(8,529	)		(13,057	)			(3,449	)		(22,591	)
Merger-related charges, net		2,095			11,386			15,154			14,214			23,528				13,481			66,293
Debt Securities (gains) losses		(17	)		5,216			173			172			85				5,199			(257	)
Tax effect1		2			(1,137	)		(44	)		(65	)		(30	)			(1,135	)		32
Debt securities (gains) losses, net		(15	)		4,079			129			107			55				4,064			(225	)
Property optimization charges		242			1,317			26,818			—			—				1,559			—
Tax effect1		(28	)		(287	)		(6,812	)		—			—				(315	)		—
Property optimization charges, net		214			1,030			20,006			—			—				1,244			—
Gain on sale of health savings accounts		—			—			(90,673	)		—			—				—			—
Tax effect1		—			—			23,031			—			—				—			—
Gain on sale of health savings accounts, net		—			—			(67,642	)		—			—				—			—
Day 1 non-PCD		—			—			—			—			—				—			96,270
Tax effect1		—			—			—			—			—				—			(17,550	)
Day 1 non-PCD, net		—			—			—			—			—				—			78,720
Total adjustments, net		5,263			16,495			(32,353	)		14,321			23,583				21,758			144,788
Net income applicable to common shares, adjusted	$	156,266		$	159,061		$	164,348		$	150,440		$	134,535			$	315,327		$	226,137
Weighted average diluted common shares outstanding		291,266			292,756			293,131			292,483			291,881				291,870			260,253
EPS, diluted	$	0.52		$	0.49		$	0.67		$	0.47		$	0.38			$	1.01		$	0.31
Adjusted EPS, diluted	$	0.54		$	0.54		$	0.56		$	0.51		$	0.46			$	1.08		$	0.87
NIM:
Net interest income	$	382,171		$	381,488		$	391,090		$	376,589		$	337,472			$	763,659		$	560,257
Add: FTE adjustment3		5,825			5,666			5,378			4,950			4,314				11,491			8,086
Net interest income (FTE)	$	387,996		$	387,154		$	396,468		$	381,539		$	341,786			$	775,150		$	568,343
Average earning assets	$	43,097,198		$	41,941,913		$	41,206,695		$	41,180,026		$	41,003,338			$	42,522,747		$	36,269,744
NIM (GAAP)		3.55	%		3.64	%		3.80	%		3.66	%		3.29	%			3.59	%		3.09	%
NIM (FTE)		3.60	%		3.69	%		3.85	%		3.71	%		3.33	%			3.65	%		3.13	%
Refer to last page of Non-GAAP reconciliations for footnotes.

Non-GAAP Measures (unaudited)
($ in thousands)
	Three Months Ended																Six Months Ended
	June 30,			March 31,			December 31,			September 30,			June 30,				June 30,			June 30,
		2023			2023			2022			2022			2022				2023			2022
PPNR:
Net interest income (FTE)3	$	387,996		$	387,154		$	396,468		$	381,539		$	341,786			$	775,150		$	568,343
Add: Noninterest income		81,629			70,681			165,037			80,385			89,117				152,310			154,357
Total revenue (FTE)		469,625			457,835			561,505			461,924			430,903				927,460			722,700
Less: Noninterest expense		(246,584	)		(250,711	)		(282,675	)		(262,444	)		(277,475	)			(497,295	)		(493,064	)
PPNR	$	223,041		$	207,124		$	278,830		$	199,480		$	153,428			$	430,165		$	229,636
Adjustments:
Gain on sale of health savings accounts	$	—		$	—		$	(90,673	)	$	—		$	—			$	—		$	—
Debt securities (gains) losses		(17	)		5,216			173			172			85				5,199			(257	)
Noninterest income adjustments		(17	)		5,216			(90,500	)		172			85				5,199			(257	)
Adjusted noninterest income		81,612			75,897			74,537			80,557			89,202				157,509			154,100
Adjusted revenue	$	469,608		$	463,051		$	471,005		$	462,096		$	430,988			$	932,659		$	722,443
Adjustments:
Louisville expenses	$	3,361		$	—		$	—		$	—		$	—			$	3,361		$	—
Merger-related charges4		2,372			14,558			20,314			22,743			36,585				16,930			77,871
Property optimization charges		242			1,317			26,818			—			—				1,559			—
Noninterest expense adjustments		5,975			15,875			47,132			22,743			36,585				21,850			77,871
Adjusted total noninterest expense		(240,609	)		(234,836	)		(235,543	)		(239,701	)		(240,890	)			(475,445	)		(415,193	)
Adjusted PPNR	$	228,999		$	228,215		$	235,462		$	222,395		$	190,098			$	457,214		$	307,250
Efficiency Ratio:
Noninterest expense	$	246,584		$	250,711		$	282,675		$	262,444		$	277,475			$	497,295		$	493,064
Less: Amortization of intangibles		(6,060	)		(6,186	)		(6,787	)		(7,089	)		(7,170	)			(12,246	)		(11,981	)
Noninterest expense, excl. amortization of intangibles		240,524			244,525			275,888			255,355			270,305				485,049			481,083
Less: Amortization of tax credit investments		(2,762	)		(2,761	)		(5,258	)		(2,662	)		(1,525	)			(5,523	)		(3,041	)
Less: Noninterest expense adjustments		(5,975	)		(15,875	)		(47,132	)		(22,743	)		(36,585	)			(21,850	)		(77,871	)
Adjusted noninterest expense	$	231,787		$	225,889		$	223,498		$	229,950		$	232,195			$	457,676		$	400,171
Total revenue (FTE)3	$	469,625		$	457,835		$	561,505		$	461,924		$	430,903			$	927,460		$	722,700
Less: Debt securities (gains) losses		(17	)		5,216			173			172			85				5,199			(257	)
Total revenue excl. debt securities (gains) losses		469,608			463,051			561,678			462,096			430,988				932,659			722,443
Less: Gain on sale of health savings accounts		—			—			(90,673	)		—			—				—			—
Total adjusted revenue	$	469,608		$	463,051		$	471,005		$	462,096		$	430,988			$	932,659		$	722,443
Efficiency Ratio		51.2	%		52.8	%		49.1	%		55.3	%		62.7	%			52.0	%		66.6	%
Efficiency Ratio (prior presentation)5	N/A			N/A			N/A				56.2	%		62.7	%		N/A				68.1	%
Adjusted Efficiency Ratio		49.4	%		48.8	%		47.5	%		49.8	%		53.9	%			49.1	%		55.4	%
Adjusted Efficiency Ratio (prior presentation)5	N/A			N/A			N/A				50.7	%		53.9	%		N/A				55.4	%
Refer to last page of Non-GAAP reconciliations for footnotes.

Non-GAAP Measures (unaudited)
($ in thousands)
	Three Months Ended																Six Months Ended
	June 30,			March 31,			December 31,			September 30,			June 30,				June 30,			June 30,
		2023			2023			2022			2022			2022				2023			2022
ROAE and ROATCE:
Net income (loss) applicable to common shares	$	151,003		$	142,566		$	196,701		$	136,119		$	110,952			$	293,569		$	81,349
Amortization of intangibles		6,060			6,186			6,787			7,089			7,170				12,246			11,981
Tax effect1		(1,515	)		(1,547	)		(1,697	)		(1,772	)		(1,793	)			(3,062	)		(2,670	)
Amortization of intangibles, net		4,545			4,639			5,090			5,317			5,377				9,184			9,311
Net income (loss) applicable to common shares, excluding intangible amortization		155,548			147,205			201,791			141,436			116,329				302,753			90,660
Total adjustments, net (see pg.11)		5,263			16,495			(32,353	)		14,321			23,583				21,758			144,788
Adjusted tangible net income applicable to common shares	$	160,811		$	163,700		$	169,438		$	155,757		$	139,912			$	324,511		$	235,448
Average shareholders' equity	$	5,273,802		$	5,166,188		$	4,936,582		$	5,134,153		$	5,129,900			$	5,220,292		$	4,676,676
Less: Average preferred equity		(243,719	)		(243,719	)		(243,719	)		(243,719	)		(243,719	)			(243,719	)		(180,814	)
Average shareholders' common equity	$	5,030,083		$	4,922,469		$	4,692,863		$	4,890,434		$	4,886,181			$	4,976,573		$	4,495,862
Average goodwill and other intangible assets		(2,115,894	)		(2,122,157	)		(2,132,480	)		(2,129,858	)		(2,136,964	)			(2,119,008	)		(1,845,422	)
Average tangible shareholder's common equity	$	2,914,189		$	2,800,312		$	2,560,383		$	2,760,576		$	2,749,217			$	2,857,565		$	2,650,440
ROAE		12.0	%		11.6	%		16.8	%		11.1	%		9.1	%			11.8	%		3.6	%
ROAE, adjusted		12.4	%		12.9	%		14.0	%		12.3	%		11.0	%			12.7	%		10.1	%
ROATCE		21.4	%		21.0	%		31.5	%		20.5	%		16.9	%			21.2	%		6.8	%
ROATCE, adjusted		22.1	%		23.4	%		26.5	%		22.6	%		20.4	%			22.7	%		17.8	%
Refer to last page of Non-GAAP reconciliations for footnotes.

Non-GAAP Measures (unaudited)
($ in thousands)
	As of
	June 30,			March 31,			December 31,			September 30,			June 30,
		2023			2023			2022			2022			2022
Tangible Common Equity:
Shareholders' equity	$	5,292,095		$	5,277,426		$	5,128,595		$	4,943,383		$	5,078,783
Less: Preferred equity		(243,719	)		(243,719	)		(243,719	)		(243,719	)		(243,719	)
Shareholders' common equity	$	5,048,376		$	5,033,707		$	4,884,876		$	4,699,664		$	4,835,064
Less: Goodwill and other intangible assets		(2,112,875	)		(2,118,935	)		(2,125,121	)		(2,135,792	)		(2,131,815	)
Tangible shareholders' common equity	$	2,935,501		$	2,914,772		$	2,759,755		$	2,563,872		$	2,703,249
Total assets	$	48,496,755		$	47,842,644		$	46,763,372		$	46,215,526		$	45,748,355
Less: Goodwill and other intangible assets		(2,112,875	)		(2,118,935	)		(2,125,121	)		(2,135,792	)		(2,131,815	)
Tangible assets	$	46,383,880		$	45,723,709		$	44,638,251		$	44,079,734		$	43,616,540
Risk-weighted assets6	$	37,414,177		$	36,801,707		$	35,950,900		$	34,741,765		$	33,662,205
Tangible common equity to tangible assets		6.33	%		6.37	%		6.18	%		5.82	%		6.20	%
Tangible common equity to risk-weighted assets6		7.85	%		7.92	%		7.68	%		7.38	%		8.03	%
Tangible Common Equity:
Common shares outstanding		292,597			291,922			292,903			292,880			292,893
Tangible common book value	$	10.03		$	9.98		$	9.42		$	8.75		$	9.23
1 Tax-effect calculations use management's estimate of the full year FTE tax rates (federal + state). 2 Includes $11.0 million of provision for unfunded commitments for the six months ended June 30, 2022. 3   Calculated using the federal statutory tax rate in effect of 21% for all periods. 4   Excludes $11.0 million of provision for unfunded commitments that is included in provision for credit losses for the six months ended June 30, 2022. 5 Presented as calculated prior to December 31, 2022, which included the provision for unfunded commitments in noninterest expense. Management believes that removing the provision for unfunded commitments from this metric enhances comparability for peer comparison purposes. 6   June 30, 2023 figures are preliminary.

FAQ

What are Old National Bancorp's 2Q23 net income and diluted EPS?

Old National Bancorp reported 2Q23 net income applicable to common shares of $151.0 million and diluted EPS of $0.52.

What was the increase in total deposits for Old National Bancorp?

Old National Bancorp saw a 3.8% increase in total deposits, with a 4% quarterly increase indicating growth in the deposit franchise.

What were the net interest income and NIM for Old National Bancorp in 2Q23?

Old National Bancorp's net interest income was $388.0 million, and NIM was 3.60%.

What was the provision for credit losses and net charge-offs for Old National Bancorp in 2Q23?

Old National Bancorp had a provision for credit losses of $14.8 million and net charge-offs of $10.1 million in 2Q23.

How did Old National Bancorp express gratitude for the support received after the Louisville tragedy?

Old National Bancorp expressed gratitude for the support received after the Louisville tragedy and continues to recover from the event.