First Hawaiian (FHB) 8-K First Hawaiian, Inc. Reports Second Quarter 2023 Financial Results and Declares Dividend

EXHIBIT 99.1

For Immediate Release

First Hawaiian, Inc. Reports Second Quarter 2023 Financial Results and Declares Dividend

HONOLULU, Hawaii July 28, 2023--(Globe Newswire)--First Hawaiian, Inc. (NASDAQ:FHB), (“First Hawaiian” or the “Company”) today reported financial results for its quarter ended June 30, 2023.

“I’m pleased to report that we had a solid second quarter in spite of a challenging interest rate environment,” said Bob Harrison, Chairman, President and CEO. “We grew loans and capital, credit quality remains excellent, and our profitability measures continue to be strong.”

On July 19, 2023, the Company’s Board of Directors declared a quarterly cash dividend of $0.26 per share. The dividend will be payable on September 1, 2023, to stockholders of record at the close of business on August 21, 2023.

Second Quarter 2023 Highlights:

● Net income of $62.4 million, or $0.49 per diluted share

● Total loans and leases increased $141.6 million versus prior quarter

● Total deposits decreased $203.3 million versus prior quarter

● Net interest margin decreased 20 basis points to 2.91%

● Recorded a $5.0 million provision for credit losses

● Board of Directors declared a quarterly dividend of $0.26 per share

Balance Sheet

Total assets were $24.5 billion as of June 30, 2023, compared to $24.9 billion as of March 31, 2023.

Gross loans and leases were $14.4 billion as of June 30, 2023, an increase of $141.6 million, or 1.0%, from $14.2 billion as of March 31, 2023.

Total deposits were $21.1 billion as of June 30, 2023, a decrease of $203.3 million, or 1.0%, from $21.3 billion as of March 31, 2023.

Net Interest Income

Net interest income for the second quarter of 2023 was $159.9 million, a decrease of $7.3 million, or 4.4%, compared to $167.2 million for the prior quarter.

The net interest margin was 2.91% in the second quarter of 2023, a decrease of 20 basis points compared to 3.11% in the prior quarter.

Provision Expense

During the quarter ended June 30, 2023, we recorded a $5.0 million provision for credit losses. In the quarter ended March 31, 2023, we recorded a $8.8 million provision for credit losses.

Noninterest Income

Noninterest income was $47.3 million in the second quarter of 2023, a decrease of $1.7 million compared to noninterest income of $49.0 million in the prior quarter.

Noninterest Expense

Noninterest expense was $120.9 million in the second quarter of 2023, an increase of $2.3 million compared to noninterest expense of $118.6 million in the prior quarter.

The efficiency ratio was 58.0% and 54.5% for the quarters ended June 30, 2023 and March 31, 2023, respectively.

Taxes

The effective tax rate was 23.3% and 24.8% for the quarters ended June 30, 2023 and March 31, 2023, respectively.

Asset Quality

The allowance for credit losses was $148.6 million, or 1.03% of total loans and leases, as of June 30, 2023, compared to $147.1 million, or 1.03% of total loans and leases, as of March 31, 2023. The reserve for unfunded commitments was $36.2 million as of both June 30, 2023 and  March 31, 2023. Net charge-offs were $3.5 million, or 0.10% of average loans and leases on an annualized basis, for the quarter ended June 30, 2023, compared to net charge-offs of $3.2 million, or 0.09% of average loans and leases on an annualized basis, for the quarter ended March 31, 2023. Total non-performing assets were $13.2 million, or 0.09% of total loans and leases and other real estate owned, on June 30, 2023, compared to total non-performing assets of $13.8 million, or 0.10% of total loans and leases and other real estate owned, on March 31, 2023.

Capital

Total stockholders’ equity was $2.4 billion and $2.3 billion on June 30, 2023 and March 31, 2023, respectively.

The tier 1 leverage, common equity tier 1 and total capital ratios were 8.30%, 12.05%, and 13.17%, respectively, on June 30, 2023, compared with 8.26%, 11.97%, and 13.09%, respectively, on March 31, 2023.

The Company did not repurchase any shares in the second quarter.

First Hawaiian, Inc.

First Hawaiian, Inc. (NASDAQ:FHB) is a bank holding company headquartered in Honolulu, Hawaii. Its principal subsidiary, First Hawaiian Bank, founded in 1858 under the name Bishop & Company, is Hawaii’s oldest and largest financial institution with branch locations throughout Hawaii, Guam and Saipan. The company offers a comprehensive suite of banking services to consumer and commercial customers including deposit products, loans, wealth management, insurance, trust, retirement planning, credit card and merchant processing services. Customers may also access their accounts through ATMs, online and mobile banking channels. For more information about First Hawaiian, Inc., visit the Company’s website, www.fhb.com.

Conference Call Information

First Hawaiian will host a conference call to discuss the Company’s results today at 1:00 p.m. Eastern Time, 7:00 a.m. Hawaii Time.  

To access the call by phone, please register via the following link:

https://register.vevent.com/register/BI348950fc095448439d48b25a0e9c5697, and you will be provided with dial in details. To avoid delays, we encourage participants to dial into the conference call fifteen minutes ahead of the scheduled start time.

A live webcast of the conference call, including a slide presentation, will be available at the following link: www.fhb.com/earnings.  The archive of the webcast will be available at the same location.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance.  These statements are often, but not always, made through the use of words or phrases such as “may”, “might”, “should”, “could”, “predict”, “potential”, “believe”, “expect”, “continue”, “will”, “anticipate”, “seek”, “estimate”, “intend”, “plan”, “projection”, “would”, “annualized” and “outlook”, or the negative version of those words or other comparable words or phrases of a future or forward-looking nature.  These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management's beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control.  Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, estimates and uncertainties that are difficult to predict. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, there can be no assurance that actual results will not prove to be materially different from the results expressed or implied by the forward-looking statements.  A number of important factors could cause actual results or performance to differ materially from the forward-looking statements, including (without limitation) the risks and uncertainties associated with the domestic and global economic environment and capital market conditions and other risk factors.  For a discussion of some of these risks and important factors that could affect our future results and financial condition, see our U.S. Securities and Exchange Commission (“SEC”) filings, including, but not limited to, our Annual Report on Form 10-K for the year ended December 31, 2022 and our Quarterly Report on Form 10-Q for the quarter ended March 31, 2023.

Use of Non-GAAP Financial Measures

Return on average tangible assets, return on average tangible stockholders’ equity, tangible book value per share and tangible stockholders’ equity to tangible assets are non-GAAP financial measures. We believe that these measurements are useful for investors, regulators, management and others to evaluate financial performance and capital adequacy relative to other financial institutions. Although these non-GAAP financial measures are frequently used by stakeholders in the evaluation of a company, they have limitations as analytical tools and should not be considered in isolation or as a substitute for analysis of our results or financial condition as reported under GAAP. Investors should consider our performance and capital adequacy as reported under GAAP and all other relevant information when assessing our performance and capital adequacy.

Table 14 at the end of this document provides a reconciliation of these non-GAAP financial measures with their most directly comparable GAAP measures.

Investor Relations Contact:	Media Contact:
Kevin Haseyama, CFA	Lindsay Chambers
(808) 525-6268	(808) 525-6254
khaseyama@fhb.com	lchambers@fhb.com

Financial Highlights	Table 1
	For the Three Months Ended									For the Six Months Ended
	June 30,			March 31,			June 30,			June 30,
(dollars in thousands, except per share data)	2023			2023			2022			2023			2022
Operating Results:
Net interest income	$	159,939		$	167,247		$	145,147		$	327,186		$	279,019
Provision for credit losses		5,000			8,800			1,000			13,800			(4,747)
Noninterest income		47,348			49,023			44,137			96,371			85,517
Noninterest expense		120,881			118,567			109,175			239,448			213,217
Net income		62,442			66,818			59,360			129,260			117,079
Basic earnings per share		0.49			0.52			0.46			1.01			0.92
Diluted earnings per share		0.49			0.52			0.46			1.01			0.91
Dividends declared per share		0.26			0.26			0.26			0.52			0.52
Dividend payout ratio		53.06	%		50.00	%		56.52	%		51.49	%		57.14	%
Performance Ratios(1):
Net interest margin		2.91	%		3.11	%		2.60	%		3.01	%		2.51	%
Efficiency ratio		57.96	%		54.46	%		57.33	%		56.17	%		58.15	%
Return on average total assets		1.01	%		1.10	%		0.94	%		1.06	%		0.94	%
Return on average tangible assets (non-GAAP)(2)		1.05	%		1.15	%		0.98	%		1.10	%		0.98	%
Return on average total stockholders' equity		10.68	%		11.78	%		10.52	%		11.23	%		9.82	%
Return on average tangible stockholders' equity (non-GAAP)(2)		18.57	%		20.78	%		18.79	%		19.65	%		16.76	%
Average Balances:
Average loans and leases	$	14,283,222		$	14,079,337		$	13,058,558		$	14,181,842		$	12,939,745
Average earning assets		22,186,316			21,873,259			22,520,605			22,030,652			22,492,066
Average assets		24,821,486			24,548,124			25,250,176			24,685,560			25,165,783
Average deposits		21,057,259			21,468,624			22,401,558			21,261,805			22,182,406
Average stockholders' equity		2,344,285			2,299,422			2,262,654			2,321,977			2,404,471
Market Value Per Share:
Closing		18.01			20.63			22.80			18.01			22.80
High		21.00			28.28			28.44			28.28			31.16
Low		15.08			19.68			21.49			15.08			21.49

	As of			As of			As of			As of
	June 30,			March 31,			December 31,			June 30,
(dollars in thousands, except per share data)	2023			2023			2022			2022
Balance Sheet Data:
Loans and leases	$	14,362,832		$	14,221,272		$	14,092,012		$	13,262,781
Total assets		24,511,566			24,884,207			24,577,223			25,377,533
Total deposits		21,078,166			21,281,500			21,689,029			22,601,454
Short-term borrowings		—			250,000			75,000			—
Long-term borrowings		500,000			500,000			—			—
Total stockholders' equity		2,359,738			2,329,012			2,269,005			2,252,611
Per Share of Common Stock:
Book value	$	18.49		$	18.26		$	17.82		$	17.67
Tangible book value (non-GAAP)(2)		10.69			10.45			10.00			9.86
Asset Quality Ratios:
Non-accrual loans and leases / total loans and leases		0.09	%		0.10	%		0.08	%		0.06	%
Allowance for credit losses for loans and leases / total loans and leases		1.03	%		1.03	%		1.02	%		1.12	%
Capital Ratios:
Common Equity Tier 1 Capital Ratio		12.05	%		11.97	%		11.82	%		11.98	%
Tier 1 Capital Ratio		12.05	%		11.97	%		11.82	%		11.98	%
Total Capital Ratio		13.17	%		13.09	%		12.92	%		13.14	%
Tier 1 Leverage Ratio		8.30	%		8.26	%		8.11	%		7.54	%
Total stockholders' equity to total assets		9.63	%		9.36	%		9.23	%		8.88	%
Tangible stockholders' equity to tangible assets (non-GAAP)(2)		5.80	%		5.58	%		5.40	%		5.16	%
Non-Financial Data:
Number of branches		51			51			51			51
Number of ATMs		296			296			294			297
Number of Full-Time Equivalent Employees		2,126			2,100			2,063			2,021

(1) Except for the efficiency ratio, amounts are annualized for the three and six months ended June 30, 2023 and 2022 and three months ended March 31, 2023.

(2) Return on average tangible assets, return on average tangible stockholders’ equity, tangible book value per share and tangible stockholders’ equity to tangible assets are non-GAAP financial measures. We compute our return on average tangible assets as the ratio of net income to average tangible assets, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total assets. We compute our return on average tangible stockholders’ equity as the ratio of net income to average tangible stockholders’ equity, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total stockholders’ equity. We compute our tangible book value per share as the ratio of tangible stockholders’ equity to outstanding shares. Tangible stockholders’ equity is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our total stockholders’ equity. We compute our tangible stockholders’ equity to tangible assets as the ratio of tangible stockholders’ equity to tangible assets, each of which we calculate by subtracting (and thereby effectively excluding) the value of our goodwill. For a reconciliation to the most directly comparable GAAP financial measure, see Table 14, GAAP to Non-GAAP Reconciliation.

Consolidated Statements of Income	Table 2
	For the Three Months Ended						For the Six Months Ended
	June 30,		March 31,		June 30,		June 30,
(dollars in thousands, except per share amounts)	2023		2023		2022		2023		2022
Interest income
Loans and lease financing	$	185,340	$	172,339	$	111,916	$	357,679	$	215,648
Available-for-sale investment securities		18,094		18,688		16,643		36,782		48,750
Held-to-maturity investment securities		18,282		18,957		18,289		37,239		18,289
Other		7,489		3,561		2,896		11,050		3,678
Total interest income		229,205		213,545		149,744		442,750		286,365
Interest expense
Deposits		58,071		43,284		4,597		101,355		7,346
Short-term and long-term borrowings		10,656		2,563		—		13,219		—
Other		539		451		—		990		—
Total interest expense		69,266		46,298		4,597		115,564		7,346
Net interest income		159,939		167,247		145,147		327,186		279,019
Provision for credit losses		5,000		8,800		1,000		13,800		(4,747)
Net interest income after provision for credit losses		154,939		158,447		144,147		313,386		283,766
Noninterest income
Service charges on deposit accounts		7,246		7,231		6,843		14,477		14,344
Credit and debit card fees		15,461		16,298		17,056		31,759		31,906
Other service charges and fees		9,056		9,162		9,018		18,218		18,672
Trust and investment services income		9,448		9,614		8,759		19,062		17,642
Bank-owned life insurance		3,271		5,120		(859)		8,391		(1,276)
Other		2,866		1,598		3,320		4,464		4,229
Total noninterest income		47,348		49,023		44,137		96,371		85,517
Noninterest expense
Salaries and employee benefits		57,904		56,032		49,902		113,936		98,128
Contracted services and professional fees		17,498		16,313		18,617		33,811		35,764
Occupancy		7,554		7,782		7,334		15,336		14,744
Equipment		11,000		9,736		7,754		20,736		13,731
Regulatory assessment and fees		3,676		3,836		2,301		7,512		4,525
Advertising and marketing		1,891		1,994		1,994		3,885		4,022
Card rewards program		7,681		8,085		7,285		15,766		14,168
Other		13,677		14,789		13,988		28,466		28,135
Total noninterest expense		120,881		118,567		109,175		239,448		213,217
Income before provision for income taxes		81,406		88,903		79,109		170,309		156,066
Provision for income taxes		18,964		22,085		19,749		41,049		38,987
Net income	$	62,442	$	66,818	$	59,360	$	129,260	$	117,079
Basic earnings per share	$	0.49	$	0.52	$	0.46	$	1.01	$	0.92
Diluted earnings per share	$	0.49	$	0.52	$	0.46	$	1.01	$	0.91
Basic weighted-average outstanding shares		127,591,371		127,453,820		127,672,244		127,522,975		127,614,564
Diluted weighted-average outstanding shares		127,832,351		128,033,812		128,014,777		127,901,225		128,108,630

Consolidated Balance Sheets	Table 3
	June 30,		March 31,		December 31,		June 30,
(dollars in thousands, except share amount)	2023		2023		2022		2022
Assets
Cash and due from banks	$	318,333	$	253,705	$	297,502	$	279,629
Interest-bearing deposits in other banks		239,798		611,887		229,122		1,254,047
Investment securities:
Available-for-sale, at fair value (amortized cost: $3,296,825 as of June 30, 2023, $3,427,708 as of March 31, 2023, $3,549,599 as of December 31, 2022 and $4,267,809 as of June 30, 2022)		2,909,372		3,054,280		3,151,133		3,967,746
Held-to-maturity, at amortized cost (fair value: $3,697,261 as of June 30, 2023, $3,824,478 as of March 31, 2023, $3,814,822 as of December 31, 2022 and $3,910,780 as of June 30, 2022)		4,180,408		4,261,361		4,320,639		4,093,215
Loans held for sale		—		—		—		180
Loans and leases		14,362,832		14,221,272		14,092,012		13,262,781
Less: allowance for credit losses		148,581		147,122		143,900		148,942
Net loans and leases		14,214,251		14,074,150		13,948,112		13,113,839
Premises and equipment, net		277,817		278,121		280,355		310,047
Other real estate owned and repossessed personal property		—		91		91		—
Accrued interest receivable		80,710		79,200		78,194		63,240
Bank-owned life insurance		476,177		473,255		473,067		470,542
Goodwill		995,492		995,492		995,492		995,492
Mortgage servicing rights		6,072		6,299		6,562		7,152
Other assets		813,136		796,366		796,954		822,404
Total assets	$	24,511,566	$	24,884,207	$	24,577,223	$	25,377,533
Liabilities and Stockholders' Equity
Deposits:
Interest-bearing	$	12,911,539	$	12,579,155	$	12,824,383	$	12,990,571
Noninterest-bearing		8,166,627		8,702,345		8,864,646		9,610,883
Total deposits		21,078,166		21,281,500		21,689,029		22,601,454
Short-term borrowings		—		250,000		75,000		—
Long-term borrowings		500,000		500,000		—		—
Retirement benefits payable		100,671		101,622		102,577		134,151
Other liabilities		472,991		422,073		441,612		389,317
Total liabilities		22,151,828		22,555,195		22,308,218		23,124,922
Stockholders' equity
Common stock ($0.01 par value; authorized 300,000,000 shares; issued/outstanding: 141,327,860 / 127,608,037 shares as of June 30, 2023, issued/outstanding: 141,291,086 / 127,573,680 shares as of March 31, 2023, issued/outstanding: 140,963,918 / 127,363,327 shares as of December 31, 2022 and issued/outstanding: 140,943,908 / 127,451,087 shares as of June 30, 2022)		1,413		1,413		1,410		1,409
Additional paid-in capital		2,543,226		2,540,653		2,538,336		2,533,407
Retained earnings		799,045		769,791		736,544		654,777
Accumulated other comprehensive loss, net		(612,736)		(611,679)		(639,254)		(571,457)
Treasury stock (13,719,823 shares as of June 30, 2023, 13,717,406 shares as of March 31, 2023, 13,600,591 shares as of December 31, 2022 and 13,492,821 shares as of June 30, 2022)		(371,210)		(371,166)		(368,031)		(365,525)
Total stockholders' equity		2,359,738		2,329,012		2,269,005		2,252,611
Total liabilities and stockholders' equity	$	24,511,566	$	24,884,207	$	24,577,223	$	25,377,533

Average Balances and Interest Rates																		Table 4
	Three Months Ended						Three Months Ended							Three Months Ended
	June 30, 2023						March 31, 2023							June 30, 2022
	Average		Income/		Yield/		Average			Income/		Yield/		Average		Income/		Yield/
(dollars in millions)	Balance		Expense		Rate		Balance			Expense		Rate		Balance		Expense		Rate
Earning Assets
Interest-Bearing Deposits in Other Banks	$	569.3	$	7.2	5.07	%	$	299.6		$	3.4	4.60	%	$	1,297.3	$	2.8	0.85	%
Available-for-Sale Investment Securities
Taxable		2,978.6		18.0	2.42			3,081.4			18.4	2.39			3,946.4		16.6	1.68
Non-Taxable		5.8		0.1	5.74			31.1			0.4	5.55			8.4		0.1	5.26
Held-to-Maturity Investment Securities
Taxable		3,618.7		15.3	1.69			3,683.8			15.7	1.70			3,533.6		15.0	1.70
Non-Taxable		610.4		3.7	2.46			612.2			4.1	2.74			607.0		4.1	2.71
Total Investment Securities		7,213.5		37.1	2.06			7,408.5			38.6	2.09			8,095.4		35.8	1.77
Loans Held for Sale		0.5		—	5.87			0.1			—	5.53			0.3		—	5.06
Loans and Leases(1)
Commercial and industrial		2,265.7		36.2	6.41			2,192.9			32.4	5.98			1,951.3		15.0	3.09
Commercial real estate		4,183.6		64.9	6.22			4,105.7			58.3	5.76			3,808.9		30.7	3.23
Construction		874.3		15.2	6.96			873.9			14.7	6.83			711.3		6.3	3.57
Residential:
Residential mortgage		4,314.0		39.1	3.62			4,307.0			38.4	3.57			4,183.0		36.7	3.51
Home equity line		1,119.3		9.2	3.31			1,074.9			8.7	3.27			945.7		5.9	2.49
Consumer		1,196.6		17.7	5.92			1,213.5			17.2	5.75			1,218.0		15.5	5.09
Lease financing		329.7		3.6	4.43			311.4			3.1	4.10			240.4		2.1	3.53
Total Loans and Leases		14,283.2		185.9	5.22			14,079.3			172.8	4.96			13,058.6		112.2	3.44
Other Earning Assets		119.8		0.3	0.99			85.8			0.2	0.76			69.0		0.1	0.79
Total Earning Assets(2)		22,186.3		230.5	4.16			21,873.3			215.0	3.97			22,520.6		150.9	2.68
Cash and Due from Banks		257.9						286.1							300.8
Other Assets		2,377.3						2,388.7							2,428.8
Total Assets	$	24,821.5					$	24,548.1						$	25,250.2
Interest-Bearing Liabilities
Interest-Bearing Deposits
Savings	$	6,099.4	$	16.1	1.05	%	$	6,354.3		$	13.9	0.89	%		6,971.3	$	1.7	0.10	%
Money Market		3,809.8		19.6	2.07			3,853.5			14.3	1.50			4,127.4		1.4	0.14
Time		2,877.8		22.4	3.12			2,515.6			15.1	2.44			1,671.4		1.5	0.36
Total Interest-Bearing Deposits		12,787.0		58.1	1.82			12,723.4			43.3	1.38			12,770.1		4.6	0.14
Federal Funds Purchased		2.9		—	5.00			67.1			0.7	4.43			—		—	—
Other Short-Term Borrowings		362.9		4.7	5.16			52.8			0.7	5.02			—		—	—
Long-Term Borrowings		500.0		6.0	4.78			105.5	���		1.2	4.52			—		—	—
Other Interest-Bearing Liabilities		54.0		0.5	4.00			42.8			0.4	4.27			—		—	—
Total Interest-Bearing Liabilities		13,706.8		69.3	2.03			12,991.6			46.3	1.45			12,770.1		4.6	0.14
Net Interest Income			$	161.2						$	168.7					$	146.3
Interest Rate Spread					2.13	%						2.52	%					2.54	%
Net Interest Margin					2.91	%						3.11	%					2.60	%
Noninterest-Bearing Demand Deposits		8,270.3						8,745.2							9,631.4
Other Liabilities		500.1						511.9							586.0
Stockholders' Equity		2,344.3						2,299.4							2,262.7
Total Liabilities and Stockholders' Equity	$	24,821.5					$	24,548.1						$	25,250.2

(1) Non-performing loans and leases are included in the respective average loan and lease balances. Income, if any, on such loans and leases is recognized on a cash basis.

(2) Interest income includes taxable-equivalent basis adjustments of $1.3 million, $1.4 million and $1.2 million for the three months ended June 30, 2023, March 31, 2023 and June 30, 2022, respectively.

Average Balances and Interest Rates											Table 5
	Six Months Ended						Six Months Ended
	June 30, 2023						June 30, 2022
	Average		Income/		Yield/		Average		Income/		Yield/
(dollars in millions)	Balance		Expense		Rate		Balance		Expense		Rate
Earning Assets
Interest-Bearing Deposits in Other Banks	$	435.2	$	10.6	4.91	%	$	1,218.3	$	3.3	0.55	%
Available-for-Sale Investment Securities
Taxable		3,029.7		36.4	2.41			5,862.7		45.7	1.56
Non-Taxable		18.4		0.5	5.58			320.8		3.9	2.41
Held-to-Maturity Investment Securities
Taxable		3,651.1		30.9	1.70			1,776.6		15.0	1.69
Non-Taxable		611.3		7.9	2.60			305.2		4.1	2.71
Total Investment Securities		7,310.5		75.7	2.08			8,265.3		68.7	1.66
Loans Held for Sale		0.3		—	5.79			0.8		—	2.60
Loans and Leases(1)
Commercial and industrial		2,229.5		68.6	6.20			1,962.1		29.7	3.05
Commercial real estate		4,144.9		123.2	5.99			3,721.0		56.4	3.06
Construction		874.1		29.9	6.89			738.9		12.1	3.30
Residential:
Residential mortgage		4,310.5		77.5	3.59			4,147.2		71.5	3.45
Home equity line		1,097.2		17.9	3.29			918.8		11.3	2.48
Consumer		1,205.0		34.8	5.84			1,218.3		31.1	5.14
Lease financing		320.6		6.8	4.27			233.4		4.0	3.48
Total Loans and Leases		14,181.8		358.7	5.09			12,939.7		216.1	3.36
Other Earning Assets		102.9		0.5	0.90			68.0		0.4	1.05
Total Earning Assets(2)		22,030.7		445.5	4.07			22,492.1		288.5	2.58
Cash and Due from Banks		271.9						296.5
Other Assets		2,383.0						2,377.2
Total Assets	$	24,685.6					$	25,165.8
Interest-Bearing Liabilities
Interest-Bearing Deposits
Savings	$	6,226.2	$	30.0	0.97	%	$	6,820.7	$	2.2	0.07	%
Money Market		3,831.5		33.9	1.78			4,088.3		2.0	0.09
Time		2,697.7		37.5	2.80			1,709.8		3.2	0.38
Total Interest-Bearing Deposits		12,755.4		101.4	1.60			12,618.8		7.4	0.12
Federal Funds Purchased		34.8		0.8	4.45			—		—	—
Other Short-Term Borrowings		208.7		5.3	5.14			—		—	—
Long-Term Borrowings		303.8		7.1	4.73			—		—	—
Other Interest-Bearing Liabilities		48.5		1.0	4.12			—		—	—
Total Interest-Bearing Liabilities		13,351.2		115.6	1.75			12,618.8		7.4	0.12
Net Interest Income			$	329.9					$	281.1
Interest Rate Spread					2.32	%					2.46	%
Net Interest Margin					3.01	%					2.51	%
Noninterest-Bearing Demand Deposits		8,506.4						9,563.6
Other Liabilities		506.0						578.9
Stockholders' Equity		2,322.0						2,404.5
Total Liabilities and Stockholders' Equity	$	24,685.6					$	25,165.8

(1) Non-performing loans and leases are included in the respective average loan and lease balances. Income, if any, on such loans and leases is recognized on a cash basis.

(2) Interest income includes taxable-equivalent basis adjustments of $2.7 million and $2.1 million for the six months ended June 30, 2023 and 2022, respectively.

Analysis of Change in Net Interest Income						Table 6
	Three Months Ended June 30, 2023
	Compared to March 31, 2023
(dollars in millions)	Volume		Rate		Total
Change in Interest Income:
Interest-Bearing Deposits in Other Banks	$	3.4	$	0.4	$	3.8
Available-for-Sale Investment Securities
Taxable		(0.6)		0.2		(0.4)
Non-Taxable		(0.3)		—		(0.3)
Held-to-Maturity Investment Securities
Taxable		(0.3)		(0.1)		(0.4)
Non-Taxable		—		(0.4)		(0.4)
Total Investment Securities		(1.2)		(0.3)		(1.5)
Loans and Leases
Commercial and industrial		1.2		2.6		3.8
Commercial real estate		1.3		5.3		6.6
Construction		—		0.5		0.5
Residential:
Residential mortgage		0.1		0.6		0.7
Home equity line		0.4		0.1		0.5
Consumer		(0.2)		0.7		0.5
Lease financing		0.2		0.3		0.5
Total Loans and Leases		3.0		10.1		13.1
Other Earning Assets		0.1		—		0.1
Total Change in Interest Income		5.3		10.2		15.5
Change in Interest Expense:
Interest-Bearing Deposits
Savings		(0.5)		2.7		2.2
Money Market		(0.2)		5.5		5.3
Time		2.5		4.8		7.3
Total Interest-Bearing Deposits		1.8		13.0		14.8
Federal Funds Purchased		(0.8)		0.1		(0.7)
Other Short-Term Borrowings		4.0		—		4.0
Long-Term Borrowings		4.7		0.1		4.8
Other Interest-Bearing Liabilities		0.1		—		0.1
Total Change in Interest Expense		9.8		13.2		23.0
Change in Net Interest Income	$	(4.5)	$	(3.0)	$	(7.5)

Analysis of Change in Net Interest Income						Table 7
	Three Months Ended June 30, 2023
	Compared to June 30, 2022
(dollars in millions)	Volume		Rate		Total
Change in Interest Income:
Interest-Bearing Deposits in Other Banks	$	(2.3)	$	6.7	$	4.4
Available-for-Sale Investment Securities
Taxable		(4.7)		6.1		1.4
Held-to-Maturity Investment Securities
Taxable		0.3		—		0.3
Non-Taxable		—		(0.4)		(0.4)
Total Investment Securities		(4.4)		5.7		1.3
Loans and Leases
Commercial and industrial		2.8		18.4		21.2
Commercial real estate		3.3		30.9		34.2
Construction		1.7		7.2		8.9
Residential:
Residential mortgage		1.2		1.2		2.4
Home equity line		1.2		2.1		3.3
Consumer		(0.3)		2.5		2.2
Lease financing		0.9		0.6		1.5
Total Loans and Leases		10.8		62.9		73.7
Other Earning Assets		0.1		0.1		0.2
Total Change in Interest Income		4.2		75.4		79.6
Change in Interest Expense:
Interest-Bearing Deposits
Savings		(0.2)		14.6		14.4
Money Market		(0.1)		18.3		18.2
Time		1.8		19.1		20.9
Total Interest-Bearing Deposits		1.5		52.0		53.5
Other Short-Term Borrowings		4.7		—		4.7
Long-Term Borrowings		6.0		—		6.0
Other Interest-Bearing Liabilities		0.5		—		0.5
Total Change in Interest Expense		12.7		52.0		64.7
Change in Net Interest Income	$	(8.5)	$	23.4	$	14.9

Analysis of Change in Net Interest Income						Table 8
	Six Months Ended June 30, 2023
	Compared to June 30, 2022
(dollars in millions)	Volume		Rate		Total
Change in Interest Income:
Interest-Bearing Deposits in Other Banks	$	(3.4)	$	10.7	$	7.3
Available-for-Sale Investment Securities
Taxable		(27.6)		18.3		(9.3)
Non-Taxable		(5.6)		2.2		(3.4)
Held-to-Maturity Investment Securities
Taxable		15.8		0.1		15.9
Non-Taxable		4.0		(0.2)		3.8
Total Investment Securities		(13.4)		20.4		7.0
Loans and Leases
Commercial and industrial		4.5		34.4		38.9
Commercial real estate		7.1		59.7		66.8
Construction		2.5		15.3		17.8
Residential:
Residential mortgage		3.0		3.0		6.0
Home equity line		2.5		4.1		6.6
Consumer		(0.4)		4.1		3.7
Lease financing		1.7		1.1		2.8
Total Loans and Leases		20.9		121.7		142.6
Other Earning Assets		0.2		(0.1)		0.1
Total Change in Interest Income		4.3		152.7		157.0
Change in Interest Expense:
Interest-Bearing Deposits
Savings		(0.2)		28.0		27.8
Money Market		(0.1)		32.0		31.9
Time		2.8		31.5		34.3
Total Interest-Bearing Deposits		2.5		91.5		94.0
Federal Funds Purchased		0.8		—		0.8
Other Short-Term Borrowings		5.3		—		5.3
Long-Term Borrowings		7.1		—		7.1
Other Interest-Bearing Liabilities		1.0		—		1.0
Total Change in Interest Expense		16.7		91.5		108.2
Change in Net Interest Income	$	(12.4)	$	61.2	$	48.8

Loans and Leases								Table 9
	June 30,		March 31,		December 31,		June 30,
(dollars in thousands)	2023		2023		2022		2022
Commercial and industrial:
Commercial and industrial excluding Paycheck Protection Program loans	$	2,175,841	$	2,254,506	$	2,217,604	$	1,898,899
Paycheck Protection Program loans		11,990		13,826		18,293		43,233
Total commercial and industrial		2,187,831		2,268,332		2,235,897		1,942,132
Commercial real estate		4,290,948		4,106,200		4,132,309		3,956,828
Construction		913,837		913,959		844,643		727,771
Residential:
Residential mortgage		4,317,537		4,318,742		4,302,788		4,212,768
Home equity line		1,138,163		1,095,365		1,055,351		971,569
Total residential		5,455,700		5,414,107		5,358,139		5,184,337
Consumer		1,182,116		1,191,552		1,222,934		1,207,051
Lease financing		332,400		327,122		298,090		244,662
Total loans and leases	$	14,362,832	$	14,221,272	$	14,092,012	$	13,262,781

Deposits								Table 10
	June 30,		March 31,		December 31,		June 30,
(dollars in thousands)	2023		2023		2022		2022
Demand	$	8,166,627	$	8,702,345	$	8,864,646	$	9,610,883
Savings		5,835,975		6,173,398		6,382,910		7,243,185
Money Market		3,767,792		3,818,355		3,965,423		4,079,706
Time		3,307,772		2,587,402		2,476,050		1,667,680
Total Deposits	$	21,078,166	$	21,281,500	$	21,689,029	$	22,601,454

Non-Performing Assets and Accruing Loans and Leases Past Due 90 Days or More								Table 11
	June 30,		March 31,		December 31,		June 30,
(dollars in thousands)	2023		2023		2022		2022
Non-Performing Assets
Non-Accrual Loans and Leases
Commercial Loans:
Commercial and industrial	$	1,024	$	1,158	$	1,215	$	682
Commercial real estate		—		727		727		727
Total Commercial Loans		1,024		1,885		1,942		1,409
Residential Loans:
Residential mortgage		6,097		6,896		6,166		6,450
Home equity line		6,107		4,903		3,797		—
Total Residential Loans		12,204		11,799		9,963		6,450
Total Non-Accrual Loans and Leases		13,228		13,684		11,905		7,859
Other Real Estate Owned		—		91		91		—
Total Non-Performing Assets	$	13,228	$	13,775	$	11,996	$	7,859
Accruing Loans and Leases Past Due 90 Days or More
Commercial Loans:
Commercial and industrial	$	599	$	461	$	291	$	2,230
Commercial real estate		619		1,346		—		176
Construction		—		102		—		352
Total Commercial Loans		1,218		1,909		291		2,758
Residential Loans:
Residential mortgage		58		58		58		750
Home equity line		—		—		—		1,039
Total Residential Loans		58		58		58		1,789
Consumer		1,975		2,502		2,885		1,218
Total Accruing Loans and Leases Past Due 90 Days or More	$	3,251	$	4,469	$	3,234	$	5,765
Total Loans and Leases	$	14,362,832	$	14,221,272	$	14,092,012	$	13,262,781

Allowance for Credit Losses and Reserve for Unfunded Commitments	Table 12
	For the Three Months Ended									For the Six Months Ended
	June 30,			March 31,			June 30,			June 30,			June 30,
(dollars in thousands)	2023			2023			2022			2023			2022
Balance at Beginning of Period	$	183,321		$	177,735		$	179,238			177,735			187,584
Loans and Leases Charged-Off
Commercial and industrial		(997)			(791)			(243)			(1,788)			(949)
Residential Loans:
Residential mortgage		—			(122)			—			(122)			—
Home equity line		(137)			(135)			(1,120)			(272)			(1,163)
Total Residential Loans		(137)			(257)			(1,120)			(394)			(1,163)
Consumer		(4,516)			(4,782)			(3,659)			(9,298)			(7,768)
Total Loans and Leases Charged-Off		(5,650)			(5,830)			(5,022)			(11,480)			(9,880)
Recoveries on Loans and Leases Previously Charged-Off
Commercial Loans:
Commercial and industrial		292			246			301			538			354
Commercial real estate		—			—			—			—			14
Lease financing		—			—			60			—			60
Total Commercial Loans		292			246			361			538			428
Residential Loans:
Residential mortgage		30			27			192			57			208
Home equity line		59			177			191			236			219
Total Residential Loans		89			204			383			293			427
Consumer		1,728			2,166			1,940			3,894			4,088
Total Recoveries on Loans and Leases Previously Charged-Off		2,109			2,616			2,684			4,725			4,943
Net Loans and Leases Charged-Off		(3,541)			(3,214)			(2,338)			(6,755)			(4,937)
Provision for Credit Losses		5,000			8,800			1,000			13,800			(4,747)
Balance at End of Period	$	184,780		$	183,321		$	177,900		$	184,780		$	177,900
Components:
Allowance for Credit Losses	$	148,581		$	147,122		$	148,942		$	148,581		$	148,942
Reserve for Unfunded Commitments		36,199			36,199			28,958			36,199			28,958
Total Allowance for Credit Losses and Reserve for Unfunded Commitments	$	184,780		$	183,321		$	177,900		$	184,780		$	177,900
Average Loans and Leases Outstanding	$	14,283,222		$	14,079,337		$	13,058,558		$	14,181,842		$	12,939,745
Ratio of Net Loans and Leases Charged-Off to Average Loans and Leases Outstanding(1)		0.10	%		0.09	%		0.07	%		0.10	%		0.08	%
Ratio of Allowance for Credit Losses for Loans and Leases to Loans and Leases Outstanding		1.03	%		1.03	%		1.12	%		1.03	%		1.12	%
Ratio of Allowance for Credit Losses for Loans and Leases to Non-accrual Loans and Leases		11.23x			10.75x			18.95x			11.23x			18.95x

(1) Annualized for the three and six months ended June 30, 2023 and 2022 and three months ended March 31, 2023.

Loans and Leases by Year of Origination and Credit Quality Indicator																		Table 13
															Revolving
															Loans
															Converted
	Term Loans												Revolving		to Term
	Amortized Cost Basis by Origination Year												Loans		Loans
													Amortized		Amortized
(dollars in thousands)	2023		2022		2021		2020		2019		Prior		Cost Basis		Cost Basis		Total
Commercial Lending
Commercial and Industrial
Risk rating:
Pass	$	33,877	$	299,913	$	385,159	$	38,769	$	157,794	$	165,747	$	952,182	$	15,003	$	2,048,444
Special Mention		103		31,193		154		849		2,397		1,481		2,967		186		39,330
Substandard		352		563		260		936		819		1,100		12,539		17		16,586
Other (1)		11,743		13,284		6,301		3,275		2,644		1,668		44,556		—		83,471
Total Commercial and Industrial		46,075		344,953		391,874		43,829		163,654		169,996		1,012,244		15,206		2,187,831
Current period gross charge-offs		72		60		9		28		92		1,527		—		—		1,788
Commercial Real Estate
Risk rating:
Pass		212,159		876,558		655,847		333,142		564,881		1,499,805		72,447		—		4,214,839
Special Mention		1,737		156		—		547		6,983		12,389		12,952		—		34,764
Substandard		—		5,141		—		171		—		35,883		2		—		41,197
Other (1)		—		—		—		—		—		148		—		—		148
Total Commercial Real Estate		213,896		881,855		655,847		333,860		571,864		1,548,225		85,401		—		4,290,948
Current period gross charge-offs		—		—		—		—		—		—		—		—		—
Construction
Risk rating:
Pass		77,826		182,679		365,959		76,728		61,906		82,554		6,562		—		854,214
Special Mention		—		—		—		—		205		—		—		—		205
Other (1)		6,601		26,882		15,766		3,261		2,136		4,067		705		—		59,418
Total Construction		84,427		209,561		381,725		79,989		64,247		86,621		7,267		—		913,837
Current period gross charge-offs		—		—		—		—		—		—		—		—		—
Lease Financing
Risk rating:
Pass		69,487		94,276		21,167		39,215		35,964		70,312		—		—		330,421
Special Mention		—		—		365		60		—		—		—		—		425
Substandard		—		—		—		171		7		1,376		—		—		1,554
Total Lease Financing		69,487		94,276		21,532		39,446		35,971		71,688		—		—		332,400
Current period gross charge-offs		—		—		—		—		—		—		—		—		—
Total Commercial Lending	$	413,885	$	1,530,645	$	1,450,978	$	497,124	$	835,736	$	1,876,530	$	1,104,912	$	15,206	$	7,725,016
Current period gross charge-offs	$	72	$	60	$	9	$	28	$	92	$	1,527	$	—	$	—	$	1,788

															Revolving
															Loans
															Converted
	Term Loans												Revolving		to Term
	Amortized Cost Basis by Origination Year												Loans		Loans
(continued)													Amortized		Amortized
(dollars in thousands)	2023		2022		2021		2020		2019		Prior		Cost Basis		Cost Basis		Total
Residential Lending
Residential Mortgage
FICO:
740 and greater	$	138,593	$	530,776	$	1,030,287	$	544,330	$	236,821	$	1,036,361	$	—	$	—	$	3,517,168
680 - 739		25,500		81,562		117,701		74,446		34,186		135,766		—		—		469,161
620 - 679		2,468		11,212		16,463		10,747		5,743		38,132		—		—		84,765
550 - 619		—		3,383		4,058		2,471		254		12,362		—		—		22,528
Less than 550		—		197		2,372		1,581		51		5,403		—		—		9,604
No Score (3)		6,075		19,497		12,552		6,378		9,837		56,201		—		—		110,540
Other (2)		9,916		18,075		17,857		12,952		8,915		28,438		7,618		—		103,771
Total Residential Mortgage		182,552		664,702		1,201,290		652,905		295,807		1,312,663		7,618		—		4,317,537
Current period gross charge-offs		—		—		—		—		—		122		—		—		122
Home Equity Line
FICO:
740 and greater		—		—		—		—		—		—		930,741		1,668		932,409
680 - 739		—		—		—		—		—		—		151,418		2,449		153,867
620 - 679		—		—		—		—		—		—		32,897		1,376		34,273
550 - 619		—		—		—		—		—		—		9,428		1,448		10,876
Less than 550		—		—		—		—		—		—		5,127		312		5,439
No Score (3)		—		—		—		—		—		—		1,299		—		1,299
Total Home Equity Line		—		—		—		—		—		—		1,130,910		7,253		1,138,163
Current period gross charge-offs		—		—		—		—		—		—		254		18		272
Total Residential Lending	$	182,552	$	664,702	$	1,201,290	$	652,905	$	295,807	$	1,312,663	$	1,138,528	$	7,253	$	5,455,700
Current period gross charge-offs	$	—	$	—	$	—	$	—	$	—	$	122	$	254	$	18	$	394
Consumer Lending
FICO:
740 and greater		70,561		153,960		93,788		45,022		34,093		19,410		117,437		140		534,411
680 - 739		44,064		84,900		49,136		23,895		19,424		11,352		72,327		431		305,529
620 - 679		14,643		37,576		19,488		9,771		11,007		8,482		33,692		941		135,600
550 - 619		2,255		10,974		8,135		5,608		6,314		5,207		11,730		748		50,971
Less than 550		418		4,358		4,478		2,695		2,975		2,765		4,247		560		22,496
No Score (3)		1,425		586		2		—		6		17		39,035		167		41,238
Other (2)		36		1,208		3,536		343		1,113		1		85,634		—		91,871
Total Consumer Lending	$	133,402	$	293,562	$	178,563	$	87,334	$	74,932	$	47,234	$	364,102	$	2,987	$	1,182,116
Current period gross charge-offs	$	58	$	1,244	$	1,260	$	630	$	1,239	$	1,388	$	3,131	$	348	$	9,298
Total Loans and Leases	$	729,839	$	2,488,909	$	2,830,831	$	1,237,363	$	1,206,475	$	3,236,427	$	2,607,542	$	25,446	$	14,362,832
Current period gross charge-offs	$	130	$	1,304	$	1,269	$	658	$	1,331	$	3,037	$	3,385	$	366	$	11,480

(1) Other credit quality indicators used for monitoring purposes are primarily FICO scores. The majority of the loans in this population were originated to borrowers with a prime FICO score.

(2) Other credit quality indicators used for monitoring purposes are primarily internal risk ratings. The majority of the loans in this population were graded with a “Pass” rating.

(3) No FICO scores are primarily related to loans and leases extended to non-residents. Loans and leases of this nature are primarily secured by collateral and/or are closely monitored for performance.

GAAP to Non-GAAP Reconciliation	Table 14
	For the Three Months Ended									For the Six Months Ended
	June 30,			March 31,			June 30,			June 30,
(dollars in thousands)	2023			2023			2022			2023			2022
Income Statement Data:
Net income	$	62,442		$	66,818		$	59,360		$	129,260		$	117,079
Average total stockholders' equity	$	2,344,285		$	2,299,422		$	2,262,654		$	2,321,977		$	2,404,471
Less: average goodwill		995,492			995,492			995,492			995,492			995,492
Average tangible stockholders' equity	$	1,348,793		$	1,303,930		$	1,267,162		$	1,326,485		$	1,408,979
Average total assets	$	24,821,486		$	24,548,124		$	25,250,176		$	24,685,560		$	25,165,783
Less: average goodwill		995,492			995,492			995,492			995,492			995,492
Average tangible assets	$	23,825,994		$	23,552,632		$	24,254,684		$	23,690,068		$	24,170,291
Return on average total stockholders' equity(1)		10.68	%		11.78	%		10.52	%		11.23	%		9.82	%
Return on average tangible stockholders' equity (non-GAAP)(1)		18.57	%		20.78	%		18.79	%		19.65	%		16.76	%
Return on average total assets(1)		1.01	%		1.10	%		0.94	%		1.06	%		0.94	%
Return on average tangible assets (non-GAAP)(1)		1.05	%		1.15	%		0.98	%		1.10	%		0.98	%

	As of			As of			As of			As of
	June 30,			March 31,			December 31,			June 30,
(dollars in thousands, except shares outstanding and per share amounts)	2023			2023			2022			2022
Balance Sheet Data:
Total stockholders' equity	$	2,359,738		$	2,329,012		$	2,269,005		$	2,252,611
Less: goodwill		995,492			995,492			995,492			995,492
Tangible stockholders' equity	$	1,364,246		$	1,333,520		$	1,273,513		$	1,257,119
Total assets	$	24,511,566		$	24,884,207		$	24,577,223		$	25,377,533
Less: goodwill		995,492			995,492			995,492			995,492
Tangible assets	$	23,516,074		$	23,888,715		$	23,581,731		$	24,382,041
Shares outstanding		127,608,037			127,573,680			127,363,327			127,451,087
Total stockholders' equity to total assets		9.63	%		9.36	%		9.23	%		8.88	%
Tangible stockholders' equity to tangible assets (non-GAAP)		5.80	%		5.58	%		5.40	%		5.16	%
Book value per share	$	18.49		$	18.26		$	17.82		$	17.67
Tangible book value per share (non-GAAP)	$	10.69		$	10.45		$	10.00		$	9.86

(1) Annualized for the three and six months ended June 30, 2023 and 2022 and three months ended March 31, 2023.