Premier Financial Corp. Announces Third Quarter 2023 Results Including Core Deposit Growth and Increased Net Interest Margin

Rhea-AI Summary

Premier Financial Corp. (Nasdaq: PFC) announced its third-quarter 2023 results, reporting net income of $24.7 million ($0.69 per diluted common share). The company saw growth in core net income, net interest margin, and deposit growth. Expenses decreased by 14.5% and loan delinquencies were down by 9.5%. Regulatory capital ratios also improved. Premier also launched a new digital banking platform to enhance customer experience.

Positive

• Premier Financial Corp. reported net income of $24.7 million ($0.69 per diluted common share) for Q3 2023, showing improvement in core net income, net interest margin, and deposit growth. Expenses decreased by 14.5% and loan delinquencies were down by 9.5%. Regulatory capital ratios improved by 23 basis points. The company also launched a new digital banking platform to enhance customer experience.

Negative

• None.

Third Quarter 2023 Highlights

• Core net income up from prior quarter
• Net interest margin increased one basis point to 2.73% from prior quarter
• Deposit growth of $71 million (up 4.1% annualized), including $92 million for core customer deposits excluding brokered (up 5.6% annualized)
• Expenses down 14.5%, or 6.8% excluding transaction costs, and core efficiency ratio improved by 96 basis points from prior quarter
• Loan delinquencies down 9.5% from prior quarter and two consecutive quarters of net recoveries
• Regulatory capital ratios improve by 23 basis points from prior quarter including common equity tier 1 (“CET1”) ratio up to 11.08%
• Declared dividend of $0.31 per share, up 3.3% from prior year comparable period
• Launched new digital banking platform to improve clients’ banking experience in October

DEFIANCE, Ohio--(BUSINESS WIRE)-- Premier Financial Corp. (Nasdaq: PFC) (“Premier” or the “Company”) announced today 2023 third quarter results, including net income of $24.7 million ($0.69 per diluted common share) compared to $48.4 million ($1.35 per diluted common share), or core $24.2 million ($0.68 per diluted common share) excluding the insurance agency sale, for the second quarter of 2023.

“I am pleased to announce Premier’s continued improvement in net income, net interest income, and net interest margin performance for the third quarter,” said Gary Small, President and CEO of Premier. “Average annualized loan growth for the quarter totaled 2.9%, consistent with our focus on serving existing client needs while remaining very selective in the pursuit of new relationships. Continued success in attracting customer deposits (up 5.6% annualized for the quarter) will translate into higher loan growth as we enter 2024.”

“Premier’s credit metrics remain steady with delinquencies down as our consumer and commercial clients continue to manage their resources well. Commercial line usage is drifting lower each month as clients utilize their excess cash to reduce line balances. The business outlook across our markets remains strong, yet conservative. Warehouse vacancy is low and manufacturing order boards remain robust, with labor availability as the major constraint. Many companies are focusing on profit margins versus growth as they work through the uncertain economic environment. The housing market remains very tight in most markets with continuing new job creation, a consistent theme across the network. The Federal Reserve’s more paced approach toward interest rates in recent months has allowed the bank, and our clients, time to address the impacts of the higher rate environment,” added Small.

“We at Premier will continue to build capital and make investments designed to improve our business, our client experience, and benefit the communities we serve,” Small continued. “To that end, all of us at Premier are very excited to have just concluded a major initiative focused on improving our client experience. We’ve recently installed a new state-of-the-art digital banking system designed to improve our clients’ banking experience across all channels of the organization. The new digital banking platform has transformed our mobile and online banking experience, bringing new features and services to our clients. Now that we’ve completed the consumer upgrades, expect to see more regarding business banking improvements in early 2024. Premier remains committed to providing an exceptional customer experience, and are committed to making investments that will best serve our clients today and in the future.”

Quarterly results

Capital, deposits and liquidity

Regulatory ratios all improved during the third quarter of 2023, including CET1 of 11.08%, Tier 1 of 11.55% and Total Capital of 13.33%, each up 23 basis points. All of these ratios also exceed well-capitalized guidelines pro forma for accumulated other comprehensive income (“AOCI”), including CET1 of 8.36%, Tier 1 of 8.84% and Total Capital of 10.61%.

Total deposits increased 4.1% annualized, or $71.2 million, during the third quarter of 2023, due to a $92.3 million increase in customer deposits (up 5.6% annualized), offset partly by a decrease of $21.1 million in brokered deposits. Total average interest-bearing deposit costs increased 47 basis points to 2.54% for the third quarter of 2023. This increase was primarily due to brokered deposits and the migration of customers from non-interest bearing deposits into interest-bearing deposits, including higher cost time deposits, as customers continue to seek better yields. Total average customer deposit costs including non-interest and excluding brokered deposits and acquisition marks were 1.85% during the month of September, representing a cumulative beta of 32% compared to the change in the monthly average effective Federal Funds rate that increased 525 basis points to 5.33% since December 2021, as reported by the Federal Reserve Economic Data.

At September 30, 2023, uninsured deposits were 32.8% of total deposits, or 17.7% adjusting for collateralized deposits, other insured deposits and internal company accounts. Total quantifiable liquidity sources totaled $2.57 billion, or 204.0% of adjusted uninsured deposits, and were comprised of the following at September 30, 2023:

• $117.5 million of cash and cash equivalents with a 5.40% Federal Reserve rate;
• $280.9 million of unpledged securities with an average yield of 3.05%;
• $1.3 billion of Federal Home Loan Bank (“FHLB”) borrowing capacity with an overnight borrowing rate of 5.40%;
• $316.7 million of brokered deposits based on a Company policy limit of 10% of deposits, with market pricing dependent on brokers and duration;
• $70.0 million of unused lines of credit with an average borrowing rate of 6.65%; and
• $471.4 million of borrowing capacity at the Federal Reserve with an average rate of 5.48%.

Additional liquidity sources include deposit growth, cash earnings in excess of dividends, loan repayments/participations/sales, and securities cash flows, which are estimated to be $66.5 million over the next 12 months.

Net interest income and margin

Net interest income of $54.3 million on a tax equivalent (“TE”) basis in the third quarter of 2023 was up 0.5% from $54.1 million in the second quarter of 2023 but down 14.5% from $63.5 million in the third quarter of 2022. The TE net interest margin of 2.73% in the third quarter of 2023 increased one basis point from 2.72% in the second quarter of 2023 but decreased 67 basis points from 3.40% in the third quarter of 2022. Results for all periods include the impact of Paycheck Protection Program (“PPP”) as well as acquisition marks and related accretion. Third quarter 2023 includes $142 thousand of accretion in interest income, $180 thousand of accretion in interest expense, and $4 thousand of interest income on average balances of $553 thousand for PPP.

Excluding the impact of acquisition marks accretion and PPP loans, core net interest income was $54.0 million, up 0.6% from $53.7 million in the second quarter of 2023 but down 14.1% from $62.9 million in the third quarter of 2022. Additionally, the core net interest margin was 2.71% for the third quarter of 2023, up one basis point from 2.70% for the second quarter of 2023 but down 65 basis points from 3.36% for the third quarter of 2022. These results are positively impacted by the combination of loan growth and higher loan yields, which were 5.12% for the third quarter of 2023 compared to 4.86% in the second quarter of 2023 and 4.29% in the third quarter of 2022. Excluding the impact of PPP, balance sheet hedges and acquisition marks accretion, loan yields were 5.16% in September 2023 for an increase of 141 basis points since December 2021, which represents a cumulative beta of 27% compared to the change in the monthly average effective Federal Funds rate for the same period.

The cost of funds in the third quarter of 2023 was 2.17%, up 25 basis points from the second quarter of 2023 and up 162 basis points from the third quarter of 2022. The increases are largely due to the higher average deposit costs discussed above. Excluding the impact of balance sheet hedges and acquisition marks accretion, cost of funds were 2.24% in September 2023 for an increase of 203 basis points since December 2021, which represents a cumulative beta of 39% compared to the change in the monthly average effective Federal Funds rate for the same period.

“Our margin has been very consistent over the past six months as we’ve taken steps to attract new money at the right rate, manage the migration of existing deposits into higher rate offerings, and have appropriately repriced loan renewals to reflect today’s environment,” said Small. “These steps, combined with nimble balance sheet management, will be the key to additional net interest income and margin improvement in the future.”

Non-interest income

Excluding insurance commissions, total non-interest income in the third quarter of 2023 of $13.3 million was up 2.6% from $12.9 million in the second quarter of 2023 excluding the $36.3 million gain on the sale of the insurance agency, and 0.3% from $13.2 million in the third quarter of 2022, primarily due to fluctuations in mortgage banking and gains/losses on securities. Mortgage banking income increased $0.3 million on a linked quarter basis but decreased $0.7 million year-over-year, primarily as a result of fluctuations in gain margins.

Security gains were $256 thousand in the third quarter of 2023, partly due to increased valuations on equity securities. This compares to gains of $64 thousand in the second quarter of 2023 and $43 thousand in the third quarter of 2022, each primarily from increased valuations on equity securities. Service fees in the third quarter of 2023 were $6.9 million, a 3.4% decrease from $7.2 million in the second quarter of 2023 but a 6.1% increase from $6.5 million in the third quarter of 2022. This change was primarily due to fluctuations in loan fees, including commercial customer swap activity. Due to the insurance agency sale in the second quarter of 2023, there were no insurance commissions in the third quarter of 2023, compared to $4.1 million in the second quarter of 2023 and $3.5 million in the third quarter of 2022. Wealth management income of $1.5 million in the third quarter of 2023 was consistent with $1.5 million in the second quarter of 2023 and up from $1.4 million in the third quarter of 2022.

Non-interest expenses

Non-interest expenses in the third quarter of 2023 were $38.1 million, a 6.8% decrease from $40.8 million in the second quarter of 2023, excluding transaction costs for the insurance agency sale, and a 7.4% decrease from $41.1 million in the third quarter of 2022. Compensation and benefits were $21.8 million in the third quarter of 2023, compared to $24.2 million in the second quarter of 2023 and $24.5 million in the third quarter of 2022. The linked quarter decrease was primarily due to the insurance agency sale and cost saving initiatives that began during the second quarter of 2023. The year-over-year decrease was primarily due to the insurance agency sale, partially offset by costs related to higher staffing levels for our 2022 growth initiatives and higher base compensation, including 2022 mid-year adjustments and 2023 annual adjustments. FDIC premiums decreased $0.4 million on a linked quarter basis due to accrual true-up in the prior quarter, but increased $0.4 million from the third quarter of 2022 primarily due to year-over-year growth. All other non-interest expenses increased only a net $11 thousand on a linked quarter basis and decreased a net $0.7 million on a year-over-year basis due to the insurance agency sale and cost saving initiatives. The efficiency ratio for the third quarter of 2023 of 56.5% improved from 57.5% (excluding transaction costs and the insurance agency gain on sale) in the second quarter of 2023 due to cost saving initiatives but worsened from 51.3% in the third quarter of 2022 due to lower revenues.

“We continue to execute on expense reductions and are pleased to have improved our core efficiency ratio almost 100 basis points this quarter,” said Paul Nungester, CFO of Premier. “Through the combination of successful cost save initiatives implemented to-date and the insurance agency sale, we have reduced our expense run-rate 11% to $152 million annualized from our beginning of the year estimate of $170 million.”

Credit quality

Non-performing assets totaled $39.9 million, or 0.47% of assets, at September 30, 2023, an increase from $37.6 million at June 30, 2023, and from $33.6 million at September 30, 2022. Loan delinquencies decreased to $17.2 million, or 0.24% of loans, at September 30, 2023, from $19.0 million at June 30, 2023, but increased from $13.2 million at September 30, 2022. Classified loans totaled $63.5 million, or 0.90% of loans, as of September 30, 2023, an increase from $60.5 million at June 30, 2023, and from $45.0 million at September 30, 2022.

The 2023 third quarter results include net recoveries of $347 thousand and a total provision benefit of $0.8 million, compared with net loan charge-offs of $154 thousand and a total provision expense of $4.0 million for the same period in 2022. The allowance for credit losses as a percentage of total loans was 1.14% at September 30, 2023, compared with 1.13% at June 30, 2023, and 1.14% at September 30, 2022. The allowance for credit losses as a percentage of total loans excluding PPP and including unaccreted acquisition marks was 1.17% at September 30, 2023, compared with 1.16% at June 30, 2023, and 1.19% at September 30, 2022. The continued economic improvement following the 2020 pandemic-related downturn has resulted in a year-over-year decrease in the allowance percentages.

“Our commercial and credit teams have expanded their loan review and analysis routines looking for early warning indicators of potential stress on specific loans and categories (e.g., office), with particular focus on ‘shocking’ the portfolio for the effect of future repricing scenarios,” said Small.

Year to date results

For the nine-month period ended September 30, 2023, net income totaled $91.2 million, or $2.55 per diluted common share, compared to $76.9 million, or $2.15 per diluted common share for the nine months ended September 30, 2022. 2023 results include the impact of the insurance agency sale for a net gain on sale after transaction costs of $32.6 million pre-tax, or $0.67 per diluted share after-tax. Excluding the impact of this item, year-to-date 2023 core net income were $67.1 million, or $1.87 per diluted share.

Net interest income of $164.8 million on a TE basis for the first nine months of 2023 was down 8.9% from $181.0 million for the same period in 2022. The TE net interest margin of 2.78% in the first nine months of 2023 decreased 62 basis points from 3.40% for the same period in 2022. Results for all periods include the impact of PPP as well as acquisition marks and related accretion. 2023 year-to-date includes $475 thousand of accretion in interest income, $613 thousand of accretion in interest expense, and $15 thousand of interest income on average balances of $729 thousand for PPP. Excluding the impact of acquisition marks accretion and PPP loans, core net interest income was $163.7 million, down 6.5% from $175.1 million in the first nine months 2022. Additionally, the core net interest margin was 2.76% for the first nine months of 2023, down 53 basis points from 3.29% for the same period of 2022. These results are positively impacted by the combination of loan growth and higher loan yields, which were 4.88% for the first nine months of 2023 compared to 4.13% for the same period in 2022. The cost of funds in the first nine months of 2023 was 1.87%, up 154 basis points for the same period of 2022. The year-over-year increase is largely due to utilization of higher cost FHLB borrowings in support of loan growth in excess of deposit growth during 2022.

Excluding insurance commissions and the $36.3 million gain on the sale of the insurance agency, total non-interest income in the first nine months of 2023 of $33.9 million was down 5.5% from $35.9 million for the same period of 2022. Insurance commissions were $8.9 million in 2023 down from $12.0 million in the first nine months of 2022 due to the insurance agency sale on June 30, 2023. Mortgage banking income decreased $4.2 million year-over-year as a result of a $3.1 million decrease in gains primarily from lower production and margins, as well as a $155 thousand mortgage servicing rights (“MSR”) valuation gain in the first nine months of 2023 compared to a $1.6 million gain for the same period of 2022.

Security losses were $1.1 million in the nine months of 2023, primarily due to decreased valuations on equity securities. This compares to a loss of $1.8 million from decreased valuations on equity securities in the first nine months 2022. The company also sold $21 million of available-for-sale (“AFS”) securities for a $27 thousand gain with average yields less than FHLB borrowing rates during the first nine months of 2023. Service fees in the first nine months of 2023 were $20.6 million, a 7.0% increase from $19.2 million in the first nine months of 2022, primarily due to fluctuations in loan fees including commercial customer swap activity and consumer activity for interchange and ATM/NSF charges. Wealth management income of $4.5 million in the first nine months of 2023 was up 6.7% from $4.2 million in the first nine months of 2022. Bank owned life insurance income of $3.5 million in the first nine months of 2023 increased from $3.0 million in the first nine months of 2022 with $0.4 million of claim gains in 2023 compared to none in 2022.

Excluding transaction costs for the insurance agency sale, non-interest expenses in the first nine months of 2023 were $121.7 million, essentially flat from $121.5 million in the first nine months of 2022. Compensation and benefits were $71.6 million in the first nine months of 2023, compared to $72.4 million in the first nine months of 2022. The year-over-year decrease was primarily due to the insurance agency sale on June 30, 2023, and cost saving initiatives that began during the second quarter of 2023 partially offset by costs related to higher staffing levels for our 2022 growth initiatives and higher base compensation, including 2022 mid-year adjustments and 2023 annual adjustments. FDIC premiums increased $2.1 million on a year-over-year basis primarily due to higher rates and our 2022 growth initiatives. All other non-interest expenses decreased a net $1.1 million on a year-over-year basis. The efficiency ratio (excluding transaction costs and the insurance agency gain on sale) for the first nine months of 2023 of 58.3% worsened from 52.7% in the first nine months of 2022 due to lower revenues partly offset by cost saving initiatives that began during the second quarter of 2023.

Results for the first nine months of 2023 include net loan charge-offs of $1.9 million and a total provision expense of $3.5 million, compared with net loan charge-offs of $5.3 million and a total provision expense of $11.5 million for the same period in 2022. The provision expense for both years is primarily due to relative loan growth.

Total assets at $8.56 billion

Total assets at September 30, 2023, were $8.56 billion, compared to $8.62 billion at June 30, 2023, and $8.24 billion at September 30, 2022. Loans receivable were $6.70 billion at September 30, 2023, compared to $6.71 billion at June 30, 2023, and $6.21 billion at September 30, 2022. At September 30, 2023, loans receivable increased $489.2 million on a year-over-year basis, or 7.9%. Commercial loans excluding PPP increased by $248.3 million from September 30, 2022, or 6.0%. Securities at September 30, 2023, were $0.92 billion, compared to $0.97 billion at June 30, 2023, and $1.08 billion at September 30, 2022. All securities are either AFS or trading and are reflected at fair value on the balance sheet. Also, at September 30, 2023, goodwill and other intangible assets totaled $308.8 million compared to $309.9 million at June 30, 2023, and $337.9 million at September 30, 2022, with the decreases attributable to intangibles amortization and the insurance agency sale.

Total non-brokered deposits at September 30, 2023, were $6.67 billion, compared with $6.58 billion at June 30, 2023, and $6.67 billion at September 30, 2022. At September 30, 2023, customer deposits increased $92.3 million on a linked quarter basis, or 5.6% annualized. Brokered deposits were $392.2 million at September 30, 2023, compared to $413.2 million at June 30, 2023 and $69.9 million at September 30, 2022.

Total stockholders’ equity was $919.6 million at September 30, 2023, compared to $937.0 million at June 30, 2023, and $865.0 million at September 30, 2022. The quarterly decrease in stockholders’ equity was primarily due to a decrease in AOCI, which was related to $24.9 million for a negative valuation adjustment on the AFS securities portfolio, partly offset by net earnings after dividends. The year-over-year increase was primarily due to net earnings after dividends including the impact the insurance agency sale offset partly by a decrease in AOCI, which was primarily related to $16.3 million of negative valuation adjustments on the AFS securities portfolio. At September 30, 2023, 1,199,634 common shares remained available for repurchase under the Company’s existing repurchase program.

Dividend to be paid November 17

The Board of Directors declared a quarterly cash dividend of $0.31 per common share payable November 17, 2023, to shareholders of record at the close of business on November 10, 2023. The dividend represents an annual dividend of 7.5 percent based on the Premier common stock closing price on October 23, 2023. Premier has approximately 35,731,000 common shares outstanding.

Conference call

Premier will host a conference call at 11:00 a.m. ET on Wednesday, October 25, 2023, to discuss the earnings results and business trends. The conference call may be accessed by calling 1-833-470-1428 and using access code 346494. Internet access to the call is also available (in listen-only mode) at the following URL: https://events.q4inc.com/attendee/320076724. The webcast replay of the conference call will be available at www.PremierFinCorp.com for one year.

About Premier Financial Corp.

Premier Financial Corp. (Nasdaq: PFC), headquartered in Defiance, Ohio, is the holding company for Premier Bank. Premier Bank, headquartered in Youngstown, Ohio, operates 75 branches and 9 loan offices in Ohio, Michigan, Indiana and Pennsylvania and also serves clients through a team of wealth professionals dedicated to each community banking branch. For more information, visit the company’s website at PremierFinCorp.com.

Financial Statements and Highlights Follow-

Safe Harbor Statement

This document may contain certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. These statements may include, but are not limited to, statements regarding projections, forecasts, goals and plans of Premier Financial Corp. and its management, future movements of interests, loan or deposit production levels, future credit quality ratios, future strength in the market area, and growth projections. These statements do not describe historical or current facts and may be identified by words such as “intend,” “intent,” “believe,” “expect,” “estimate,” “target,” “plan,” “anticipate,” or similar words or phrases, or future or conditional verbs such as “will,” “would,” “should,” “could,” “might,” “may,” “can,” or similar verbs. There can be no assurances that the forward-looking statements included in this presentation will prove to be accurate. In light of the significant uncertainties in the forward-looking statements, the inclusion of such information should not be regarded as a representation by Premier or any other persons, that our objectives and plans will be achieved. Forward-looking statements involve numerous risks and uncertainties, any one or more of which could affect Premier’s business and financial results in future periods and could cause actual results to differ materially from plans and projections. These risks and uncertainties include, but not limited to: financial markets, our customers, and our business and results of operation; changes in interest rates; disruptions in the mortgage market; risks and uncertainties inherent in general and local banking, insurance and mortgage conditions; political uncertainty; uncertainty in U.S. fiscal or monetary policy; uncertainty concerning or disruptions relating to tensions surrounding the current socioeconomic landscape; competitive factors specific to markets in which Premier and its subsidiaries operate; increasing competition for financial products from other financial institutions and nonbank financial technology companies; future interest rate levels; legislative or regulatory rulemaking or actions; capital market conditions; security breaches or unauthorized disclosure of confidential customer or Company information; interruptions in the effective operation of information and transaction processing systems of Premier or Premier’s vendors and service providers; failures or delays in integrating or adopting new technology; the impact of the cessation of LIBOR interest rates and implementation of a replacement rate; and other risks and uncertainties detailed from time to time in our Securities and Exchange Commission (SEC) filings, including our Annual Report on Form 10-K for the year ended December 31, 2022 and any further amendments thereto. All forward-looking statements made in this presentation are based on information presently available to the management of Premier and speak only as of the date on which they are made. We assume no obligation to update any forward-looking statements, whether as a result of new information, future developments or otherwise, except as may be required by law. As required by U.S. GAAP, Premier will evaluate the impact of subsequent events through the issuance date of its September 30, 2023, consolidated financial statements as part of its Quarterly Report on Form 10-Q to be filed with the SEC. Accordingly, subsequent events could occur that may cause Premier to update its critical accounting estimates and to revise its financial information from that which is contained in this news release.

Non-GAAP Reporting Measures

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

Consolidated Balance Sheets (Unaudited)
Premier Financial Corp.
		September 30,			June 30,			March 31,			December 31,			September 30,
(in thousands)			2023			2023			2023			2022			2022
Assets
Cash and cash equivalents
Cash and amounts due from depositories		$	70,642		$	71,096		$	68,628		$	88,257		$	67,124
Interest-bearing deposits			46,855			50,631			88,399			39,903			37,868
			117,497			121,727			157,027			128,160			104,992
Available-for-sale, carried at fair value			911,184			961,123			998,128			1,040,081			1,063,713
Equity securities, carried at fair value			5,860			6,458			6,387			7,832			15,336
Securities investments			917,044			967,581			1,004,515			1,047,913			1,079,049
Loans (1)			6,696,869			6,708,568			6,575,829			6,460,620			6,207,708
Allowance for credit losses - loans			(76,513	)		(75,921	)		(74,273	)		(72,816	)		(70,626	)
Loans, net			6,620,356			6,632,647			6,501,556			6,387,804			6,137,082
Loans held for sale			135,218			128,079			119,604			115,251			129,142
Mortgage servicing rights			19,642			20,160			20,654			21,171			20,832
Accrued interest receivable			34,648			30,056			29,388			28,709			26,021
Federal Home Loan Bank stock			25,049			39,887			37,056			29,185			28,262
Bank Owned Life Insurance			172,906			171,856			170,841			170,713			169,728
Office properties and equipment			55,679			55,736			55,982			55,541			53,747
Real estate and other assets held for sale			387			561			393			619			416
Goodwill			295,602			295,602			317,988			317,988			317,948
Core deposit and other intangibles			13,220			14,298			17,804			19,074			19,972
Other assets			155,628			138,021			129,508			133,214			148,949
Total Assets		$	8,562,876		$	8,616,211		$	8,562,316		$	8,455,342		$	8,236,140
Liabilities and Stockholders’ Equity
Non-interest-bearing deposits		$	1,545,595		$	1,573,837		$	1,649,726		$	1,869,509		$	1,826,511
Interest-bearing deposits			5,127,863			5,007,358			4,969,436			4,893,502			4,836,113
Brokered deposits			392,181			413,237			154,869			143,708			69,881
Total deposits			7,065,639			6,994,432			6,774,031			6,906,719			6,732,505
Advances from FHLB			339,000			455,000			658,000			428,000			411,000
Subordinated debentures			85,197			85,166			85,123			85,103			85,071
Advance payments by borrowers			22,781			26,045			26,300			34,188			33,511
Reserve for credit losses - unfunded commitments			4,690			5,708			6,577			6,816			7,061
Other liabilities			126,002			112,889			97,835			106,795			102,032
Total Liabilities			7,643,309			7,679,240			7,647,866			7,567,621			7,371,180
Stockholders’ Equity
Preferred stock			-			-			-			-			-
Common stock, net			306			306			306			306			306
Additional paid-in-capital			690,038			689,579			689,807			691,453			691,578
Accumulated other comprehensive income (loss)			(200,282	)		(168,721	)		(153,709	)		(173,460	)		(181,231	)
Retained earnings			560,945			547,336			510,021			502,909			488,305
Treasury stock, at cost			(131,440	)		(131,529	)		(131,975	)		(133,487	)		(133,998	)
Total Stockholders’ Equity			919,567			936,971			914,450			887,721			864,960
Total Liabilities and Stockholders’ Equity		$	8,562,876		$	8,616,211		$	8,562,316		$	8,455,342		$	8,236,140
(1) Includes PPP loans of:		$	526		$	577		$	791		$	1,143		$	1,181

Consolidated Statements of Income (Unaudited)
Premier Financial Corp.
	Three Months Ended															Nine Months Ended
(in thousands, except per share amounts)	9/30/23			6/30/23			3/31/23			12/31/22			9/30/22			9/30/23			9/30/22
Interest Income:
Loans	$	86,612		$	81,616		$	76,057		$	72,194		$	65,559		$	244,285		$	177,366
Investment securities		6,943			6,997			7,261			7,605			6,814			21,201			18,489
Interest-bearing deposits		652			641			444			444			221			1,737			387
FHLB stock dividends		690			905			394			482			510			1,989			743
Total interest income		94,897			90,159			84,156			80,725			73,104			269,212			196,985
Interest Expense:
Deposits		34,874			26,825			21,458			13,161			6,855			83,157			11,749
FHLB advances		4,597			8,217			5,336			3,941			2,069			18,150			2,609
Subordinated debentures		1,162			1,125			1,075			1,000			868			3,362			2,326
Notes Payable		-			-			-			4			-			-			1
Total interest expense		40,633			36,167			27,869			18,106			9,792			104,669			16,685
Net interest income		54,264			53,992			56,287			62,619			63,312			164,543			180,300
Provision (benefit) for credit losses - loans		245			1,410			3,944			3,020			3,706			5,599			9,483
Provision (benefit) for credit losses - unfunded commitments		(1,018	)		(870	)		(238	)		(246	)		306			(2,126	)		2,030
Total provision (benefit) for credit losses		(773	)		540			3,706			2,774			4,012			3,473			11,513
Net interest income after provision		55,037			53,452			52,581			59,845			59,300			161,070			168,787
Non-interest Income:
Service fees and other charges		6,947			7,190			6,428			6,632			6,545			20,564			19,221
Mortgage banking income		3,274			2,940			(274	)		(299	)		3,970			5,940			10,170
Gain (loss) on sale of non-mortgage loans		-			71			-			-			-			71			-
Gain (loss) on sale of available for sale securities		-			(7	)		34			1			-			27			-
Gain (loss) on equity securities		256			71			(1,445	)		1,209			43			(1,118	)		(1,760	)
Gain on sale of insurance agency		-			36,296			-			-			-			36,296			-
Insurance commissions		-			4,131			4,725			3,576			3,488			8,856			12,043
Wealth management income		1,509			1,537			1,485			1,582			1,355			4,531			4,246
Income from Bank Owned Life Insurance		1,050			1,015			1,417			984			983			3,482			2,961
Other non-interest income		217			102			92			543			320			412			1,051
Total Non-interest Income		13,253			53,346			12,462			14,228			16,704			79,061			47,932
Non-interest Expense:
Compensation and benefits		21,813			24,175			25,658			24,999			24,522			71,646			72,397
Occupancy		3,145			3,320			3,574			3,383			3,463			10,039			10,657
FDIC insurance premium		1,346			1,786			1,288			1,276			976			4,420			2,370
Financial institutions tax		989			961			852			795			1,050			2,802			3,315
Data processing		4,010			3,640			3,863			3,882			3,121			11,513			9,899
Amortization of intangibles		1,078			1,223			1,270			1,293			1,338			3,571			4,156
Transaction costs		-			3,652			-			-			-			3,652			-
Other non-interest expense		5,671			5,738			6,286			7,400			6,629			17,695			18,689
Total Non-interest Expense		38,052			44,495			42,791			43,028			41,099			125,338			121,483
Income before income taxes		30,238			62,303			22,252			31,045			34,905			114,793			95,236
Income tax expense		5,551			13,912			4,103			5,770			6,710			23,566			18,324
Net Income	$	24,687		$	48,391		$	18,149		$	25,275		$	28,195		$	91,227		$	76,912
Earnings per common share:
Basic	$	0.69		$	1.35		$	0.51		$	0.71		$	0.79		$	2.55		$	2.15
Diluted	$	0.69		$	1.35		$	0.51		$	0.71		$	0.79		$	2.55		$	2.15
Average Shares Outstanding:
Basic		35,730			35,722			35,606			35,589			35,582			35,701			35,709
Diluted		35,794			35,800			35,719			35,790			35,704			35,769			35,818

Premier Financial Corp.
Selected Quarterly Information
	Three Months Ended																Nine Months Ended
(dollars in thousands, except per share data)	9/30/23			6/30/23			3/31/23			12/31/22			9/30/22				9/30/23			9/30/22
Summary of Operations
Tax-equivalent interest income (1)	$	94,951		$	90,226		$	84,260		$	80,889		$	73,301			$	269,437		$	197,637
Interest expense		40,633			36,167			27,869			18,106			9,792				104,669			16,685
Tax-equivalent net interest income (1)		54,318			54,059			56,391			62,783			63,509				164,768			180,952
Provision expense for credit losses		(773	)		540			3,706			2,774			4,012				3,473			11,513
Non-interest income (ex securities gains/losses)		12,997			53,282			13,873			13,018			16,661				80,152			49,692
Core non-interest income (ex securities gains/losses) (2)		12,997			16,986			13,873			13,018			16,661				43,856			49,692
Non-interest expense		38,052			44,495			42,791			43,028			41,099				125,338			121,483
Core non-interest expense (2)		38,052			40,843			42,791			43,028			41,099				121,686			121,483
Income tax expense		5,551			13,912			4,103			5,770			6,710				23,566			18,324
Net income		24,687			48,391			18,149			25,275			28,195				91,227			76,912
Core net income (2)		24,687			24,230			18,149			25,275			28,195				67,066			76,912
Tax equivalent adjustment (1)		54			67			104			164			197				225			652
At Period End
Total assets	$	8,562,876		$	8,616,211		$	8,562,316		$	8,455,342		$	8,236,140
Goodwill and intangibles		308,822			309,900			335,792			337,062			337,920
Tangible assets (3)		8,254,054			8,306,311			8,226,524			8,118,280			7,898,220
Earning assets		7,744,522			7,818,825			7,751,130			7,620,056			7,411,403
Loans		6,696,869			6,708,568			6,575,829			6,460,620			6,207,708
Allowance for loan losses		76,513			75,921			74,273			72,816			70,626
Deposits		7,065,639			6,994,432			6,774,031			6,906,719			6,732,505
Stockholders’ equity		919,567			936,971			914,450			887,721			864,960
Stockholders’ equity / assets		10.74	%		10.87	%		10.68	%		10.50	%		10.50	%
Tangible equity (3)		610,745			627,071			578,658			550,659			527,040
Tangible equity / tangible assets		7.40	%		7.55	%		7.03	%		6.78	%		6.67	%
Average Balances
Total assets	$	8,582,219		$	8,597,786		$	8,433,100		$	8,304,462		$	8,161,389			$	8,538,248		$	7,807,013
Earning assets		7,969,363			7,951,520			7,783,850			7,653,648			7,477,795				7,904,565			7,097,421
Loans		6,763,232			6,714,240			6,535,080			6,359,564			6,120,324				6,671,687			5,726,369
Deposits and interest-bearing liabilities		7,486,595			7,538,674			7,385,946			7,278,531			7,116,910				7,470,774			6,748,783
Deposits		7,045,827			6,799,605			6,833,521			6,773,382			6,654,328				6,893,762			6,452,713
Stockholders’ equity		939,456			921,441			901,587			875,287			912,224				920,967			945,141
Goodwill and intangibles		309,330			334,862			336,418			337,207			338,583				326,771			339,946
Tangible equity (3)		630,126			586,579			565,169			538,080			573,641				594,196			605,195
Per Common Share Data
Earnings per share ("EPS") - Basic	$	0.69		$	1.35		$	0.51		$	0.71		$	0.79			$	2.55		$	2.15
EPS - Diluted		0.69			1.35			0.51			0.71			0.79				2.55			2.15
EPS - Core diluted (2)		0.69			0.68			0.51			0.71			0.79				1.87			2.15
Dividends Paid		0.31			0.31			0.31			0.30			0.30				0.93			0.90
Market Value:
High	$	22.89		$	21.01		$	27.80		$	30.51		$	29.36			$	27.99		$	32.52
Low		15.70			13.60			20.39			26.11			24.67				13.60			24.67
Close		17.06			16.02			20.73			26.97			25.70				17.06			25.70
Common Book Value		25.74			26.23			25.61			24.94			24.32
Tangible Common Book Value (3)		17.09			17.55			16.21			15.47			14.82
Shares outstanding, end of period (000s)		35,731			35,727			35,701			35,591			35,563
Performance Ratios (annualized)
Tax-equivalent net interest margin (1)		2.73	%		2.72	%		2.90	%		3.28	%		3.40	%			2.78	%		3.40	%
Return on average assets		1.14	%		2.26	%		0.86	%		1.21	%		1.37	%			1.43	%		1.32	%
Core return on average assets (2)		1.14	%		1.13	%		0.86	%		1.22	%		1.39	%			1.05	%		1.32	%
Return on average equity		10.43	%		21.06	%		8.07	%		11.46	%		12.26	%			13.24	%		10.88	%
Core return on average equity (2)		10.43	%		10.55	%		8.07	%		11.58	%		12.40	%			9.74	%		10.88	%
Return on average tangible equity		15.54	%		33.09	%		12.88	%		18.64	%		19.50	%			20.53	%		16.99	%
Core return on average tangible equity (2)		15.54	%		16.57	%		10.51	%		14.64	%		16.33	%			15.09	%		16.99	%
Efficiency ratio (4)		56.53	%		41.45	%		60.90	%		56.76	%		51.26	%			51.18	%		52.67	%
Core efficiency ratio (2)		56.53	%		57.49	%		60.90	%		56.76	%		51.26	%			58.33	%		52.67	%
Effective tax rate		18.36	%		22.33	%		18.44	%		18.59	%		19.22	%			20.53	%		19.24	%
Common dividend payout ratio		44.93	%		22.96	%		60.78	%		42.25	%		37.97	%			36.47	%		41.86	%
(1) Interest income on tax-exempt securities and loans has been adjusted to a tax-equivalent basis using the statutory federal income tax rate of 21%.
(2) Core items exclude the impact of insurance agency disposition related items. See non-GAAP reconciliations.
(3) Tangible assets = total assets less the sum of goodwill and core deposit and other intangibles. Tangible equity = total stockholders' equity less the sum of goodwill, core deposit and other intangibles, and preferred stock. Tangible common book value = tangible equity divided by shares outstanding at the end of the period.
(4) Efficiency ratio = Non-interest expense divided by sum of tax-equivalent net interest income plus non-interest income, excluding securities gains or losses, net.

Premier Financial Corp.
Yield Analysis
(dollars in thousands)	Three Months Ended																Nine Months Ended
	9/30/23			6/30/23			3/31/23			12/31/22			9/30/22				9/30/23			9/30/22
Average Balances
Interest-earning assets:
Loans receivable (1)	$	6,763,232		$	6,714,240		$	6,535,080		$	6,359,564		$	6,120,324			$	6,671,687		$	5,726,369
Securities		1,137,730			1,155,451			1,190,359			1,236,511			1,262,435				1,160,987			1,266,681
Interest Bearing Deposits		38,210			36,730			35,056			29,884			68,530				36,677			84,745
FHLB stock		30,191			45,099			30,353			28,386			27,414				35,214			19,626
Total interest-earning assets		7,969,363			7,951,520			7,790,848			7,654,345			7,478,703				7,904,565			7,097,421
Non-interest-earning assets		612,856			646,266			642,252			650,117			682,686				633,683			709,592
Total assets	$	8,582,219		$	8,597,786		$	8,433,100		$	8,304,462		$	8,161,389			$	8,538,248		$	7,807,013
Deposits and Interest-bearing Liabilities:
Interest bearing deposits	$	5,490,945		$	5,195,727		$	5,078,510		$	4,901,412		$	4,846,419			$	5,256,571		$	4,688,047
FHLB advances and other		355,576			653,923			467,311			419,761			377,533				491,861			210,908
Subordinated debentures		85,179			85,146			85,114			85,084			85,049				85,147			85,019
Notes payable		13			-			-			304			-				4			143
Total interest-bearing liabilities		5,931,713			5,934,796			5,630,935			5,406,561			5,309,001				5,833,583			4,984,117
Non-interest bearing deposits		1,554,882			1,603,878			1,755,011			1,871,970			1,807,909				1,637,191			1,764,666
Total including non-interest-bearing deposits		7,486,595			7,538,674			7,385,946			7,278,531			7,116,910				7,470,774			6,748,783
Other non-interest-bearing liabilities		156,168			137,671			145,567			150,644			132,255				146,507			113,089
Total liabilities		7,642,763			7,676,345			7,531,513			7,429,175			7,249,165				7,617,281			6,861,872
Stockholders' equity		939,456			921,441			901,587			875,287			912,224				920,967			945,141
Total liabilities and stockholders' equity	$	8,582,219		$	8,597,786		$	8,433,100		$	8,304,462		$	8,161,389			$	8,538,248		$	7,807,013
IEAs/IBLs		134	%		134	%		138	%		142	%		141	%			136	%		142	%
Interest Income/Expense
Interest-earning assets:
Loans receivable (2)	$	86,618		$	81,622		$	76,063		$	72,201		$	65,564			$	244,303		$	177,385
Securities (2)		6,991			7,058			7,359			7,762			7,006				21,408			19,122
Interest Bearing Deposits		652			641			444			444			221				1,737			387
FHLB stock		690			905			394			482			510				1,989			743
Total interest-earning assets		94,951			90,226			84,260			80,889			73,301				269,437			197,637
Deposits and Interest-bearing Liabilities:
Interest bearing deposits	$	34,874		$	26,825		$	21,458		$	13,161		$	6,855			$	83,157		$	11,749
FHLB advances and other		4,597			8,217			5,336			3,941			2,069				18,150			2,609
Subordinated debentures		1,162			1,125			1,075			1,001			868				3,362			2,326
Notes payable		-			-			-			3			-				-			1
Total interest-bearing liabilities		40,633			36,167			27,869			18,106			9,792				104,669			16,685
Non-interest bearing deposits		-			-			-			-			-				-			-
Total including non-interest-bearing deposits		40,633			36,167			27,869			18,106			9,792				104,669			16,685
Net interest income	$	54,318		$	54,059		$	56,391		$	62,783		$	63,509			$	164,768		$	180,952
Less: PPP income		(4	)		(5	)		(6	)		(6	)		(26	)			(15	)		(3,827	)
Less: Acquisition marks accretion		(322	)		(380	)		(387	)		(554	)		(608	)			(1,088	)		(2,051	)
Core net interest income	$	53,992		$	53,674		$	55,998		$	62,223		$	62,875			$	163,665		$	175,074
Annualized Average Rates
Interest-earning assets:
Loans receivable		5.12	%		4.86	%		4.66	%		4.54	%		4.29	%			4.88	%		4.13	%
Securities (3)		2.46	%		2.44	%		2.47	%		2.51	%		2.22	%			2.46	%		2.01	%
Interest Bearing Deposits		6.83	%		6.98	%		5.07	%		5.94	%		1.29	%			6.31	%		0.61	%
FHLB stock		9.14	%		8.03	%		5.19	%		6.79	%		7.44	%			7.53	%		5.05	%
Total interest-earning assets		4.77	%		4.54	%		4.33	%		4.23	%		3.92	%			4.54	%		3.71	%
Deposits and Interest-bearing Liabilities:
Interest bearing deposits		2.54	%		2.07	%		1.69	%		1.07	%		0.57	%			2.11	%		0.33	%
FHLB advances and other		5.17	%		5.03	%		4.57	%		3.76	%		2.19	%			4.92	%		1.65	%
Subordinated debentures		5.46	%		5.29	%		5.05	%		4.71	%		4.08	%			5.26	%		3.65	%
Notes payable		-			-			-			3.95	%		-				-			0.93	%
Total interest-bearing liabilities		2.74	%		2.44	%		1.98	%		1.34	%		0.74	%			3.59	%		0.67	%
Non-interest bearing deposits		-			-			-			-			-				-			-
Total including non-interest-bearing deposits		2.17	%		1.92	%		1.51	%		1.00	%		0.55	%			1.87	%		0.33	%
Net interest spread		2.03	%		2.10	%		2.35	%		2.89	%		3.18	%			0.95	%		3.04	%
Net interest margin (4)		2.73	%		2.72	%		2.90	%		3.28	%		3.40	%			2.78	%		3.40	%
Core net interest margin (4)		2.71	%		2.70	%		2.88	%		3.25	%		3.36	%			2.76	%		3.29	%
(1) Includes average PPP loans of:	$	553		$	673		$	965		$	1,160		$	1,889			$	729		$	15,790
(2) Interest on certain tax exempt loans and securities is not taxable for Federal income tax purposes. In order to compare the tax-exempt yields on these assets to taxable yields, the interest earned on these assets is adjusted to a pre-tax equivalent amount based on the marginal corporate federal income tax rate of 21%.
(3) Securities yield = annualized interest income divided by the average balance of securities, excluding average unrealized gains/losses.
(4) Net interest margin is tax equivalent net interest income divided by average interest-earning assets. Core net interest margin represents net interest margin excluding PPP and acquisition marks accretion.

Premier Financial Corp.
Deposits and Liquidity
(dollars in thousands)
	As of and for the Three Months Ended
	9/30/23				6/30/23				3/31/23				12/31/22				9/30/22
Ending Balances
Non-interest-bearing demand deposits	$	1,545,595			$	1,573,837			$	1,649,726			$	1,869,509			$	1,826,511
Savings deposits		709,938				748,392				775,186				797,376				817,853
Interest-bearing demand deposits		580,069				594,325				646,329				653,960				665,974
Money market account deposits		1,279,551				1,282,721				1,342,451				1,493,729				1,463,600
Time deposits		925,353				904,717				856,720				768,678				630,077
Public funds, ICS and CDARS deposits		1,632,952				1,477,203				1,348,750				1,179,759				1,258,610
Brokered deposits		392,181				413,237				154,869				143,708				69,881
Total deposits	$	7,065,639			$	6,994,432			$	6,774,031			$	6,906,719			$	6,732,505
Average Balances
Non-interest-bearing demand deposits	$	1,554,882			$	1,603,878			$	1,755,011			$	1,871,970			$	1,807,909
Savings deposits		728,545				762,074				782,215				806,653				825,673
Interest-bearing demand deposits		575,744				603,572				637,423				651,685				681,247
Money market account deposits		1,278,381				1,311,177				1,430,905				1,418,549				1,493,019
Time deposits		912,579				872,991				825,652				685,453				610,708
Public funds, ICS and CDARS deposits		1,573,213				1,399,749				1,232,230				1,235,772				1,204,968
Brokered deposits		422,483				246,164				170,085				103,300				30,804
Total deposits	$	7,045,827			$	6,799,605			$	6,833,521			$	6,773,382			$	6,654,328
Average Rates
Non-interest-bearing demand deposits		0.00	%			0.00	%			0.00	%			0.00	%			0.00	%
Savings deposits		0.03	%			0.02	%			0.02	%			0.02	%			0.02	%
Interest-bearing demand deposits		0.11	%			0.10	%			0.07	%			0.07	%			0.07	%
Money market account deposits		2.02	%			1.73	%			1.54	%			0.81	%			0.40	%
Time deposits		2.68	%			2.27	%			1.83	%			1.05	%			0.58	%
Public funds, ICS and CDARS deposits		4.18	%			3.71	%			3.32	%			2.41	%			1.38	%
Brokered deposits		5.36	%			4.92	%			4.19	%			3.32	%			2.37	%
Total deposits		1.98	%			1.58	%			1.26	%			0.78	%			0.41	%
Other Deposits Data
Loans/Deposits Ratio		94.8	%			95.9	%			97.1	%			93.5	%			92.2	%
Uninsured deposits %		32.8	%			31.5	%			32.3	%			35.3	%			35.5	%
Adjusted uninsured deposits % (1)		17.7	%			17.3	%			19.6	%			22.2	%			22.2	%
Top 20 depositors %		14.1	%			12.4	%			12.1	%			5.4	%			11.3	%
Public funds %		18.8	%			17.5	%			16.5	%			14.8	%			15.9	%
Average account size (excluding brokered)	$	27.1			$	26.7			$	27.0			$	27.8			$	27.5
Securities Data
Held-to-maturity (HTM) at fair value	$	-			$	-			$	-			$	-			$	-
Available-for-sale (AFS) at fair value (2)		911,184				961,123				998,128				1,040,081				1,063,713
Equity investment at fair value (3)		5,860				6,458				6,387				7,832				15,336
Total securities at fair value	$	917,044			$	967,581			$	1,004,515			$	1,047,913			$	1,079,049
Cash+Securities/Assets		12.1	%			12.6	%			13.6	%			13.9	%			14.4	%
Projected AFS cash flow in next 12 months	$	66,495			$	64,687			$	73,184			$	73,319			$	76,119
AFS average life (years)		6.5				6.5				6.4				6.5				6.6
Liquidity Sources
Cash and cash equivalents	$	117,497			$	121,727			$	157,027			$	128,160			$	104,992
Unpledged securities at fair value		280,916				298,471				211,468				288,134				342,979
FHLB borrowing capacity		1,311,091				1,542,459				1,358,650				1,528,978				1,217,516
Brokered deposits (Company policy limit of 10%)		316,697				288,719				524,889				549,370				605,552
Bank and parent lines of credit		70,000				70,000				70,000				70,000				70,000
Federal Reserve - Discount Window and BTFP (4)		471,395				491,141				129,918				44,471				-
Total	$	2,567,596			$	2,812,517			$	2,451,952			$	2,609,113			$	2,341,039
Total liquidity to adjusted uninsured deposits ratio		204.0	%			230.5	%			183.2	%			168.9	%			155.4	%
(1) Adjusted for collateralized deposits, other insured deposits and intra-company accounts.
(2) Mark-to-market included in accumulated other comprehensive income.
(3) Mark-to-market included in net income each quarter.
(4) Includes borrowing capacity related to unpledged securities at par value in excess of fair value under Bank Term Funding Program.

Premier Financial Corp.
Loans and Capital
(dollars in thousands)
		9/30/23			6/30/23			3/31/23			12/31/22			9/30/22
Loan Portfolio Composition
Residential real estate		$	1,797,676		$	1,711,632		$	1,624,331		$	1,535,574		$	1,478,360
Residential real estate construction			51,637			111,708			141,209			176,737			119,204
Total residential loans			1,849,313			1,823,340			1,765,540			1,712,311			1,597,564
Commercial real estate			2,820,410			2,848,410			2,813,441			2,762,311			2,674,078
Commercial construction			502,502			472,328			440,510			428,743			398,044
Commercial excluding PPP			1,038,939			1,068,795			1,060,351			1,054,037			1,041,423
Core commercial loans (1)			4,361,851			4,389,533			4,314,302			4,245,091			4,113,545
Consumer direct/indirect			203,800			210,390			212,299			213,405			212,790
Home equity and improvement lines			269,053			272,792			271,676			277,613			272,367
Total consumer loans			472,853			483,182			483,975			491,018			485,157
Deferred loan origination fees			12,326			11,936			11,221			11,057			10,261
Core loans (1)			6,696,343			6,707,991			6,575,038			6,459,477			6,206,527
PPP loans			526			577			791			1,143			1,181
Total loans		$	6,696,869		$	6,708,568		$	6,575,829		$	6,460,620		$	6,207,708
Loans held for sale		$	135,218		$	128,079		$	119,631		$	115,251		$	129,142
Core residential loans (1)			1,984,531			1,951,419			1,885,171			1,827,562			1,726,706
Total loans including loans held for sale but excluding PPP			6,831,561			6,836,070			6,694,669			6,574,728			6,335,669
Undisbursed construction loan funds - residential		$	82,689		$	102,198		$	157,934		$	209,306		$	231,598
Undisbursed construction loan funds - commercial			284,610			353,455			446,294			463,469			493,199
Undisbursed construction loan funds - total			367,299			455,653			604,228			672,775			724,797
Total construction loans including undisbursed funds		$	921,438		$	1,039,689		$	1,185,947		$	1,278,255		$	1,242,045
Gross loans (2)		$	7,051,842		$	7,152,285		$	7,168,836		$	7,122,338		$	6,922,244
Fixed rate loans %			49.8	%		49.8	%		49.5	%		48.8	%		48.7	%
Floating rate loans %			15.8	%		15.9	%		13.4	%		14.3	%		16.0	%
Adjustable rate loans repricing within 1 year %			2.9	%		1.5	%		2.0	%		2.6	%		0.8	%
Adjustable rate loans repricing over 1 year %			31.5	%		32.8	%		35.1	%		34.3	%		34.5	%
Commercial Real Estate Loans Composition
Non owner occupied excluding office		$	1,023,585		$	1,012,400		$	947,442		$	934,760		$	905,512
Non owner occupied office			207,869			225,046			220,668			222,300			203,565
Owner occupied excluding office			597,303			603,650			609,203			578,514			570,662
Owner occupied office			106,761			107,240			109,014			108,087			105,224
Multifamily			627,602			633,909			661,996			660,823			637,701
Agriculture land			119,710			123,104			122,384			125,384			122,416
Other commercial real estate			137,580			143,061			142,734			132,443			128,998
Total commercial real estate loans		$	2,820,410		$	2,848,410		$	2,813,441		$	2,762,311		$	2,674,078
Capital Balances
Total equity		$	919,567		$	936,971		$	914,450		$	887,721		$	864,960
Less: Regulatory goodwill and intangibles			303,740			304,818			330,711			331,981			332,839
Less: Accumulated other comprehensive income/(loss) ("AOCI")			(200,282	)		(168,721	)		(153,709	)		(173,460	)		(181,231	)
Common equity tier 1 capital ("CET1")			816,109			800,874			737,448			729,200			713,352
Add: Tier 1 subordinated debt			35,000			35,000			35,000			35,000			35,000
Tier 1 capital			851,109			835,874			772,448			764,200			748,352
Add: Regulatory allowances			80,791			80,812			80,003			78,780			76,530
Add: Tier 2 subordinated debt			50,000			50,000			50,000			50,000			50,000
Total risk-based capital		$	981,900		$	966,686		$	902,451		$	892,980		$	874,882
Total risk-weighted assets		$	7,364,534		$	7,381,940		$	7,370,704		$	7,355,979		$	7,385,877
Capital Ratios
CET1 Ratio			11.08	%		10.85	%		10.01	%		9.91	%		9.66	%
CET1 Ratio including AOCI			8.36	%		8.56	%		7.92	%		7.55	%		7.20	%
Tier 1 Capital Ratio			11.55	%		11.32	%		10.48	%		10.39	%		10.13	%
Tier 1 Capital Ratio including AOCI			8.84	%		9.04	%		8.39	%		8.03	%		7.68	%
Total Capital Ratio			13.33	%		13.10	%		12.24	%		12.14	%		11.85	%
Total Capital Ratio including AOCI			10.61	%		10.81	%		10.16	%		9.78	%		9.39	%
(1) Core loans represents total loans excluding undisbursed loan funds, deferred loan origination fees and PPP loans. Core commercial loans represents total commercial real estate, commercial and commercial construction excluding commercial undisbursed loan funds, deferred loan origination fees and PPP loans. Core residential loans represents total loans held for sale, one to four family residential real estate and residential construction excluding residential undisbursed loan funds and deferred loan origination fees.
(2) Gross loans represent total loans including undisbursed construction funds but excluding deferred loan origination fees.

Premier Financial Corp.
Loan Delinquency Information
(dollars in thousands)	Total Balance			Current			30 to 89 days past due			% of Total			Non Accrual Loans			% of Total
September 30, 2023
One to four family residential real estate	$	1,797,676		$	1,778,106		$	7,857		0.44	%		$	11,713		0.65	%
Construction		921,438			921,438			-		0.00	%			-		0.00	%
Commercial real estate		2,820,410			2,809,421			24		0.00	%			10,965		0.39	%
Commercial		1,039,465			1,025,632			1,670		0.16	%			12,163		1.17	%
Home equity and improvement		269,053			263,806			3,471		1.29	%			1,776		0.66	%
Consumer finance		203,800			196,754			4,200		2.06	%			2,846		1.40	%
Gross loans	$	7,051,842		$	6,995,157		$	17,222		0.24	%		$	39,463		0.56	%
June 30, 2023
One to four family residential real estate	$	1,711,632		$	1,694,024		$	7,320		0.43	%		$	10,288		0.60	%
Construction		1,039,689			1,039,404			285		0.03	%			-		0.00	%
Commercial real estate		2,848,410			2,833,765			596		0.02	%			14,049		0.49	%
Commercial		1,069,372			1,057,057			4,290		0.40	%			8,025		0.75	%
Home equity and improvement		272,792			267,617			2,945		1.08	%			2,230		0.82	%
Consumer finance		210,390			204,404			3,587		1.70	%			2,399		1.14	%
Gross loans	$	7,152,285		$	7,096,271		$	19,023		0.27	%		$	36,991		0.52	%
September 30, 2022
One to four family residential real estate	$	1,478,360		$	1,464,319		$	6,232		0.42	%		$	7,809		0.53	%
Construction		1,242,045			1,242,045			-		0.00	%			-		0.00	%
Commercial real estate		2,674,078			2,660,068			116		0.00	%			13,894		0.52	%
Commercial		1,042,604			1,034,898			338		0.03	%			7,368		0.71	%
Home equity and improvement		272,367			267,077			3,144		1.15	%			2,146		0.79	%
Consumer finance		212,790			207,453			3,417		1.61	%			1,920		0.90	%
Gross loans	$	6,922,244		$	6,875,860		$	13,247		0.19	%		$	33,137		0.48	%
Loan Risk Ratings Information
(dollars in thousands)	Total Balance			Pass Rated			Special Mention			% of Total			Classified			% of Total
September 30, 2023
One to four family residential real estate	$	1,786,659		$	1,775,530		$	422		0.02	%		$	10,707		0.60	%
Construction		921,438			913,605			7,833		0.85	%			-		0.00	%
Commercial real estate		2,819,121			2,738,398			54,523		1.93	%			26,200		0.93	%
Commercial		1,034,943			982,927			31,930		3.09	%			20,086		1.94	%
Home equity and improvement		267,106			265,975			-		0.00	%			1,131		0.42	%
Consumer finance		203,584			200,965			-		0.00	%			2,619		1.29	%
PCD loans		18,991			13,374			2,814		14.82	%			2,803		14.76	%
Gross loans	$	7,051,842		$	6,890,774		$	97,522		1.38	%		$	63,546		0.90	%
June 30, 2023
One to four family residential real estate	$	1,700,468		$	1,689,666		$	484		0.03	%		$	10,318		0.61	%
Construction		1,039,689			1,031,356			8,333		0.80	%			-		0.00	%
Commercial real estate		2,847,035			2,797,688			20,751		0.73	%			28,596		1.00	%
Commercial		1,063,744			1,021,403			27,376		2.57	%			14,965		1.41	%
Home equity and improvement		270,722			269,038			-		0.00	%			1,684		0.62	%
Consumer finance		210,158			207,963			-		0.00	%			2,195		1.04	%
PCD loans		20,469			13,981			3,786		18.50	%			2,702		13.20	%
Gross loans	$	7,152,285		$	7,031,095		$	60,730		0.85	%		$	60,460		0.85	%
September 30, 2022
One to four family residential real estate	$	1,466,470		$	1,458,082		$	1,267		0.09	%		$	7,121		0.49	%
Construction		1,242,045			1,240,745			1,300		0.10	%			-		0.00	%
Commercial real estate		2,672,451			2,584,984			65,233		2.44	%			22,234		0.83	%
Commercial		1,036,441			1,009,384			20,106		1.94	%			6,951		0.67	%
Home equity and improvement		269,786			268,384			-		0.00	%			1,402		0.52	%
Consumer finance		212,493			210,602			-		0.00	%			1,891		0.89	%
PCD loans		22,558			17,044			93		0.41	%			5,421		24.03	%
Gross loans	$	6,922,244		$	6,789,225		$	87,999		1.27	%		$	45,020		0.65	%

Premier Financial Corp.
Mortgage and Credit Information
(dollars in thousands)
		As of and for the Three Months Ended																						Nine Months Ended
Mortgage Banking Summary		9/30/23				6/30/23				3/31/23				12/31/22				9/30/22						9/30/23				9/30/22
Revenue from sales and servicing of mortgage loans:
Mortgage banking gains, net		$	2,584			$	2,242			$	(837	)		$	(1,285	)		$	3,363					$	3,989			$	7,072
Mortgage loan servicing revenue (expense):
Mortgage loan servicing revenue			1,850				1,845				1,888				1,862				1,861						5,583				5,602
Amortization of mortgage servicing rights			(1,291	)			(1,277	)			(1,219	)			(1,271	)			(1,350	)					(3,787	)			(4,128	)
Mortgage servicing rights valuation adjustments			131				130				(106	)			396				96						155				1,624
			690				698				563				987				607						1,951				3,098
Total revenue from sale/servicing of mortgage loans		$	3,274			$	2,940			$	(274	)		$	(298	)		$	3,970					$	5,940			$	10,170
Mortgage servicing rights:
Balance at beginning of period		$	20,823			$	21,447			$	21,858			$	21,915			$	21,872					$	21,858			$	22,244
Loans sold, servicing retained			642				653				808				1,214				1,393						2,103				3,799
Amortization			(1,291	)			(1,277	)			(1,219	)			(1,271	)			(1,350	)					(3,787	)			(4,128	)
Balance at end of period			20,174				20,823				21,447				21,858				21,915						20,174				21,915
Valuation allowance:
Balance at beginning of period			(663	)			(793	)			(687	)			(1,083	)			(1,179	)					(687	)			(2,707	)
Impairment recovery (charges)			131				130				(106	)			396				96						155				1,624
Balance at end of period			(532	)			(663	)			(793	)			(687	)			(1,083	)					(532	)			(1,083	)
Net carrying value at end of period		$	19,642			$	20,160			$	20,654			$	21,171			$	20,832					$	19,642			$	20,832
Allowance for credit losses - loans
Beginning allowance		$	75,921			$	74,273			$	72,816			$	70,626			$	67,074					$	72,816			$	66,468
Provision (benefit) for credit losses - loans			245				1,410				3,944				3,020				3,706						5,599				9,483
Net recoveries (charge-offs)			347				238				(2,487	)			(830	)			(154	)					(1,902	)			(5,325	)
Ending allowance		$	76,513			$	75,921			$	74,273			$	72,816			$	70,626					$	76,513			$	70,626
Total loans		$	6,696,869			$	6,708,568			$	6,575,829			$	6,460,620			$	6,207,708
Less: PPP loans			(526	)			(577	)			(791	)			(1,143	)			(1,181	)
Total loans ex PPP		$	6,696,343			$	6,707,991			$	6,575,038			$	6,459,477			$	6,206,527
Allowance for credit losses (ACL)		$	76,513			$	75,921			$	74,273			$	72,816			$	70,626
Add: Unaccreted purchase accounting marks			1,526				1,901				2,301				2,706				3,291
Adjusted ACL		$	78,039			$	77,822			$	76,574			$	75,522			$	73,917
ACL/Loans			1.14	%			1.13	%			1.13	%			1.13	%			1.14	%
Adjusted ACL/Loans ex PPP			1.17	%			1.16	%			1.16	%			1.17	%			1.19	%
Credit Quality
Total non-performing loans (1)		$	39,463			$	36,991			$	34,377			$	33,822			$	33,137
Real estate owned (REO)			387				561				393				619				416
Total non-performing assets (2)		$	39,850			$	37,552			$	34,770			$	34,441			$	33,553
Net charge-offs (recoveries)			(347	)			(238	)			2,487				830				154
Allowance for credit losses / non-performing assets			192.00	%			202.18	%			213.61	%			211.42	%			210.49	%
Allowance for credit losses / non-performing loans			193.89	%			205.24	%			216.05	%			215.29	%			213.13	%
Non-performing assets / loans plus REO			0.60	%			0.56	%			0.53	%			0.53	%			0.54	%
Non-performing assets / total assets			0.47	%			0.44	%			0.41	%			0.41	%			0.41	%
Net charge-offs (recoveries) / average loans			-0.02	%			-0.01	%			0.15	%			0.05	%			0.01	%
Net charge-offs (recoveries) / average loans LTM			0.04	%			0.14	%			0.14	%			0.10	%			0.26	%
(1) Non-performing loans consist of non-accrual loans.
(2) Non-performing assets are non-performing loans plus real estate and other assets acquired by foreclosure or deed-in-lieu thereof.

Premier Financial Corp.
Non-GAAP Reconciliations
		Three Months Ended																						Nine Months Ended
(In thousands, except per share and ratio data)		9/30/23				6/30/23				3/31/23				12/31/22				9/30/22						9/30/23				9/30/22
Total non-interest expenses		$	38,052			$	44,495			$	42,791			$	43,028			$	41,099					$	125,338			$	121,483
Less: Transaction costs (pre-tax)			-				3,652				-				-				-						3,652				-
Core non-interest expenses		$	38,052			$	40,843			$	42,791			$	43,028			$	41,099					$	121,686			$	121,483
Non-interest income		$	13,253			$	53,346			$	12,462			$	14,228			$	16,704					$	79,061			$	47,932
Less: Gain on sale of insurance agency (pre-tax)			-				36,296				-				-				-						36,296				-
Core non-interest income		$	13,253			$	17,050			$	12,462			$	14,228			$	16,704					$	42,765			$	47,932
Less: Securities gains (losses)			256				64				(1,411	)			1,210				43						(1,091	)			(1,760	)
Core non-interest income (ex securities gains/losses)		$	12,997			$	16,986			$	13,873			$	13,018			$	16,661					$	43,856			$	49,692
Tax-equivalent net interest income		$	54,318			$	54,059			$	56,391			$	62,783			$	63,509					$	164,768			$	180,952
Core non-interest income (ex securities gains/losses)			12,997				16,986				13,873				13,018				16,661						43,856				49,692
Total core revenues			67,315				71,045				70,264				75,801				80,170						208,624				230,644
Core non-interest expenses		$	38,052			$	40,843			$	42,791			$	43,028			$	41,099					$	121,686			$	121,483
Core efficiency ratio			56.53	%			57.49	%			60.90	%			56.76	%			51.26	%					58.33	%			52.67	%
Income (loss) before income taxes		$	30,238			$	62,303			$	22,252			$	31,045			$	34,905					$	114,793			$	95,236
Add: Provision (benefit) for credit losses			(773	)			540				3,706				2,774				4,012						3,473				11,513
Pre-tax pre-provision income			29,465				62,843				25,958				33,819				38,917						118,266				106,749
Add: Transaction costs (pre-tax)			-				3,652				-				-				-						3,652				-
Less: Gain on sale of insurance agency (pre-tax)			-				36,296				-				-				-						36,296				-
Core pre-tax pre-provision income		$	29,465			$	30,199			$	25,958			$	33,819			$	38,917					$	85,622			$	106,749
Average total assets		$	8,582,219			$	8,597,786			$	8,433,100			$	8,304,462			$	8,161,389					$	8,538,248			$	7,807,013
Core pre-tax pre-provision return on average assets			1.36	%			1.41	%			1.25	%			1.62	%			1.89	%					1.34	%			1.83	%
Net income (loss)		$	24,687			$	48,391			$	18,149			$	25,275			$	28,195					$	91,227			$	76,912
Less: Gain on sale of insurance agency (pre-tax)			-				36,296				-				-				-						36,296				-
Add: Transaction costs (pre-tax)			-				3,652				-				-				-						3,652				-
Add: Tax impact of sale transaction			-				8,483				-				-				-						8,483				-
Core net income		$	24,687			$	24,230			$	18,149			$	25,275			$	28,195					$	67,066			$	76,912
Diluted shares - Reported			35,794				35,800				35,719				35,790				35,704						35,769				35,818
Core diluted EPS		$	0.69			$	0.68			$	0.51			$	0.71			$	0.79					$	1.87			$	2.15
Average total assets		$	8,582,219			$	8,597,786			$	8,433,100			$	8,304,462			$	8,161,389					$	8,538,248			$	7,807,013
Core return on average assets			1.14	%			1.13	%			0.87	%			1.21	%			1.37	%					1.05	%			1.32	%
Average total equity		$	939,456			$	921,441			$	901,587			$	875,287			$	912,224					$	920,967			$	945,141
Core return on average equity			10.43	%			10.55	%			8.16	%			11.46	%			12.26	%					9.74	%			10.88	%
Average total tangible equity		$	630,126			$	586,579			$	565,169			$	538,080			$	573,641					$	594,196			$	605,195
Core return on average tangible equity			15.54	%			16.57	%			13.02	%			18.64	%			19.50	%					15.09	%			16.99	%

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20231024691802/en/

Paul Nungester

EVP and CFO 419.785.8700

PNungester@yourpremierbank.com

Source: Premier Financial Corp.

FAQ

What were Premier Financial Corp.'s net income and earnings per share for Q3 2023?

Premier Financial Corp. reported net income of $24.7 million ($0.69 per diluted common share) for Q3 2023.

What were the key highlights of Premier Financial Corp.'s Q3 2023 results?

The key highlights of Premier Financial Corp.'s Q3 2023 results include growth in core net income, net interest margin, and deposit growth. Expenses decreased by 14.5% and loan delinquencies were down by 9.5%. Regulatory capital ratios also improved.

What new initiative did Premier Financial Corp. launch?

Premier Financial Corp. launched a new digital banking platform to enhance customer experience.