First Hawaiian, Inc. Reports Second Quarter 2021 Financial Results and Declares Dividend

Honolulu, Hawaii, UNITED STATES


HONOLULU, July 23, 2021 (GLOBE NEWSWIRE) -- First Hawaiian, Inc. (NASDAQ:FHB), (“First Hawaiian” or the “Company”) today reported financial results for its quarter ended June 30, 2021.

“We are pleased with our financial performance during the second quarter, which was driven by the strong return of tourism and pickup in the local economy,” said Bob Harrison, Chairman, President and CEO.  “We had good activity in the loan portfolio, solid growth in fee income and credit quality remained excellent. In addition, we benefitted from the improved outlook for the local economy with the release of $35 million from our reserves for credit losses.”

On July 21, 2021 the Company’s Board of Directors declared a quarterly cash dividend of $0.26 per share. The dividend will be payable on September 3, 2021 to stockholders of record at the close of business on August 23, 2021.  

Second Quarter 2021 Highlights:

  • Net income of $86.7 million, or $0.67 per diluted share
  • Total loans and leases decreased $196.5 million, or 1.5%, versus prior quarter
  • Total deposits increased $701.4 million, or 3.5%, versus prior quarter
  • Recorded a $35.0 million negative provision for credit losses
  • Board of Directors declared a quarterly dividend of $0.26 per share
  • Repurchased $22.4 million of stock under share repurchase program

Balance Sheet

Total assets were $24.2 billion as of June 30, 2021, compared to $23.5 billion as of March 31, 2021.

Gross loans and leases were $13.1 billion as of June 30, 2021, a decrease of $196.5 million, or 1.5%, from $13.3 billion as of March 31, 2021.

Total deposits were $20.8 billion as of June 30, 2021, an increase of $701.4 million, or 3.5%, from $20.1 billion as of March 31, 2021.

Net Interest Income

Net interest income for the second quarter of 2021 was $131.5 million, an increase of $2.3 million, or 1.8%, compared to $129.2 million for the prior quarter.  

The net interest margin (NIM) was 2.46% in the second quarter of 2021, a decrease of 9 basis points compared to 2.55% in the first quarter of 2021.

Provision Expense

During the quarter ended June 30, 2021, we recorded a $35.0 million negative provision for credit losses. We did not record a provision for credit losses in the quarter ended March 31, 2021.

Noninterest Income

Noninterest income was $49.4 million in the second quarter of 2021, an increase of $5.5 million compared to noninterest income of $43.9 million in the first quarter of 2021.     

Noninterest Expense

Noninterest expense was $99.4 million in the second quarter of 2021, an increase of $3.1 million compared to noninterest expense of $96.3 million in the first quarter of 2021.

The efficiency ratio was 54.7% and 55.5% for the quarters ended June 30, 2021 and March 31, 2021, respectively.

Taxes

The effective tax rate was 25.5% for the quarter ended June 30, 2021 and 24.8% for the quarter ended March 31, 2021.

Asset Quality

The allowance for credit losses was $169.1 million, or 1.29% of total loans and leases, as of June 30, 2021, compared to $200.4 million, or 1.51% of total loans and leases, as of March 31, 2021. The reserve for unfunded commitments was $29.2 million as of June 30, 2021 compared to $34.1 million as of March 31, 2021. Net charge-offs were $1.1 million, or 0.03% of average loans and leases on an annualized basis, for the quarter ended June 30, 2021, compared to net charge-offs of $4.6 million, or 0.14% of average loans and leases on an annualized basis, for the quarter ended March 31, 2021. Total non-performing assets were $8.9 million, or 0.07% of total loans and leases and other real estate owned, at June 30, 2021, compared to total non-performing assets of $9.1 million, or 0.07% of total loans and leases and other real estate owned at March 31, 2021.  

Capital

Total stockholders' equity was $2.7 billion at both June 30, 2021 and March 31, 2021.    

The tier 1 leverage, common equity tier 1 and total capital ratios were 7.68%, 12.76% and 14.01%, respectively, at June 30, 2021, compared with 7.90%, 12.82% and 14.07%, respectively, at March 31, 2021.

The Company repurchased 0.8 million shares of common stock at a total cost of $22.4 million under the stock repurchase program in the second quarter. The average cost was $27.99 per share repurchased. Remaining buyback authority under the stock repurchase program was $43.1 million at June 30, 2021.

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, participants should dial (844) 452-2942 (US/Canada), or (574) 990-9846 (International) ten minutes prior to the start of the call and enter the conference ID: 3681457.   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. A telephonic replay of the conference call will be available two hours after the conclusion of the call until 4:30 p.m. (Eastern Time) on July 30, 2021. Access the replay by dialing (855) 859-2056 or (404) 537-3406 and entering the conference ID: 3681457.

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. Further, statements about the potential effects of the COVID-19 pandemic on our businesses and financial results and conditions may constitute forward-looking statements and are subject to the risk that the actual effects may differ, possibly materially, from what is reflected in those forward-looking statements due to factors and future developments that are uncertain, unpredictable and in many cases beyond our control, including the scope and duration of the pandemic, actions taken by governmental authorities in response to the pandemic, and the direct and indirect impact of the pandemic on our customers, third parties and us. 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 ongoing impacts of COVID-19, 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, 2020 and our Quarterly Report on Form 10-Q for the quarter ended March 31, 2021.

Use of Non-GAAP Financial Measures

We present net interest income, noninterest income, noninterest expense, net income, earnings per share (basic and diluted) and the related ratios described below, on an adjusted, or ‘‘core,’’ basis, each a non-GAAP financial measure. These core measures exclude from the corresponding GAAP measure the impact of certain items that we do not believe are representative of our financial results. We believe that the presentation of these non-GAAP financial measures helps identify underlying trends in our business from period to period that could otherwise be distorted by the effect of certain expenses, gains and other items included in our operating results. We believe that these core measures provide useful information about our operating results and enhance the overall understanding of our past performance and future performance. Investors should consider our performance and financial condition as reported under GAAP and all other relevant information when assessing our performance or financial condition.

Core net interest margin, core efficiency ratio, core return on average total assets and core return on average total stockholders’ equity are non-GAAP financial measures. We compute our core net interest margin as the ratio of core net interest income to average earning assets. We compute our core efficiency ratio as the ratio of core noninterest expense to the sum of core net interest income and core noninterest income.   We compute our core return on average total assets as the ratio of core net income to average total assets. We compute our core return on average total stockholders’ equity as the ratio of core net income to average total stockholders’ equity.

Return on average tangible stockholders’ equity, core return on average tangible stockholders’ equity, return on average tangible assets, core return on average tangible assets and tangible stockholders’ equity to tangible assets are non-GAAP financial measures. 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 core return on average tangible stockholders’ equity as the ratio of core 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 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 core return on average tangible assets as the ratio of core net income to average tangible assets. 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. 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.

Tables 14 and 15 at the end of this document provide a reconciliation of these non-GAAP financial measures with their most directly comparable GAAP measures.

Investor Relations Contact:
Kevin Haseyama, CFA
(808) 525-6268
khaseyama@fhb.com
Media Contact:
Susan Kam
(808) 525-6254
skam@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) 2021    2021    2020 2021    2020 
Operating Results:                   
Net interest income $ 131,481  $129,158  $127,822  $ 260,639  $266,505  
Provision for credit losses   (35,000)     55,446    (35,000)  96,646  
Noninterest income   49,371   43,868   45,656    93,239   94,884  
Noninterest expense   99,388   96,306   91,450    195,694   187,916  
Net income   86,741   57,693   20,049    144,434   58,914  
Basic earnings per share   0.67   0.44   0.15    1.11   0.45  
Diluted earnings per share   0.67   0.44   0.15    1.11   0.45  
Dividends declared per share   0.26   0.26   0.26    0.52   0.52  
Dividend payout ratio   38.81 % 59.09 % 173.33 %  46.85 % 115.56 %
Supplemental Income Statement Data (non-GAAP):                   
Core net interest income $ 131,481  $129,158  $127,822  $ 260,639  $266,505  
Core noninterest income   49,269   43,868   45,867    93,137   95,010  
Core noninterest expense   98,228   96,306   91,450    194,534   187,916  
Core net income   87,704   57,693   20,204    145,397   59,007  
Core basic earnings per share   0.68   0.44   0.16    1.12   0.45  
Core diluted earnings per share   0.68   0.44   0.16    1.12   0.45  
Performance Ratios(1):                   
Net interest margin   2.46 %   2.55 % 2.58 %  2.50 %   2.84 %
Core net interest margin (non-GAAP)   2.46 %   2.55 % 2.58 %  2.50 %   2.84 %
Efficiency ratio   54.74 %   55.53 % 52.70 %  55.12 %   51.99 %
Core efficiency ratio (non-GAAP)   54.13 %   55.53 % 52.64 %  54.81 %   51.97 %
Return on average total assets   1.45 %   1.02 % 0.36 %  1.24 %   0.56 %
Core return on average total assets (non-GAAP)   1.46 %   1.02 % 0.36 %  1.25 %   0.56 %
Return on average tangible assets (non-GAAP)   1.51 %   1.07 % 0.38 %  1.30 %   0.58 %
Core return on average tangible assets (non-GAAP)(2)   1.53 %   1.07 % 0.38 %  1.30 %   0.58 %
Return on average total stockholders' equity   12.92 %   8.58 % 2.99 %  10.75 %   4.42 %
Core return on average total stockholders' equity (non-GAAP)   13.07 %   8.58 % 3.01 %  10.82 %   4.43 %
Return on average tangible stockholders' equity (non-GAAP)   20.51 %   13.51 % 4.74 %  16.99 %   7.04 %
Core return on average tangible stockholders’ equity (non-GAAP)(3)   20.74 %   13.51 % 4.77 %  17.10 %   7.05 %
Average Balances:                   
Average loans and leases $ 13,205,086  $13,242,270  $13,956,669  $ 13,223,575  $13,574,048  
Average earning assets   21,539,264   20,476,149   19,854,795    21,010,643   18,834,492  
Average assets   24,015,065   22,944,699   22,341,654    23,482,839   21,327,479  
Average deposits   20,638,015   19,503,067   18,540,394    20,073,676   17,541,849  
Average stockholders' equity   2,691,966   2,727,701   2,697,775    2,709,735   2,679,293  
Market Value Per Share:                   
Closing   28.34   27.37   17.24    28.34   17.24  
High   29.85   30.80   21.50    30.80   31.25  
Low   24.75   23.14   13.56    23.14   13.56  


                  
  As of As of As of As of 
  June 30,  March 31,  December 31,  June 30,  
(dollars in thousands, except per share data) 2021 2021 2020 2020 
Balance Sheet Data:                 
Loans and leases $ 13,103,785  $13,300,289  $13,279,097  $13,764,030  
Total assets   24,246,328   23,497,596   22,662,831   22,993,715  
Total deposits   20,835,115   20,133,681   19,227,723   19,361,634  
Short-term borrowings           200,000  
Long-term borrowings   200,000   200,010   200,010   200,019  
Total stockholders' equity   2,731,341   2,683,630   2,744,104   2,701,897  
                  
Per Share of Common Stock:                 
Book value $ 21.17  $20.68  $21.12  $20.81  
Tangible book value (non-GAAP)(4)   13.45   13.01   13.46   13.14  
                  
Asset Quality Ratios:                 
Non-accrual loans and leases / total loans and leases   0.07 %   0.07 % 0.07 % 0.24 %
Allowance for credit losses for loans and leases / total loans and leases   1.29 %   1.51 % 1.57 % 1.40 %
                  
Capital Ratios:                 
Common Equity Tier 1 Capital Ratio    12.76 %   12.82 % 12.47 % 11.86 %
Tier 1 Capital Ratio   12.76 %   12.82 % 12.47 % 11.86 %
Total Capital Ratio   14.01 %   14.07 % 13.73 % 13.11 %
Tier 1 Leverage Ratio   7.68 %   7.90 % 8.00 % 7.75 %
Total stockholders' equity to total assets   11.26 %   11.42 % 12.11 % 11.75 %
Tangible stockholders' equity to tangible assets (non-GAAP)   7.47 %   7.50 % 8.07 % 7.76 %
                  
Non-Financial Data:                 
Number of branches   54   54   54   58  
Number of ATMs   294   297   297   295  
Number of Full-Time Equivalent Employees   2,087   2,090   2,103   2,100  

________________________
(1)   Except for the efficiency ratio and the core efficiency ratio, amounts are annualized for the three and six months ended June 30, 2021 and 2020 and the three months ended March 31, 2021.

(2)   Core return on average tangible assets is a non-GAAP financial measure. We compute our core return on average tangible assets as the ratio of core 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. For a reconciliation to the most directly comparable GAAP financial measure for core net income, see Table 14, GAAP to Non-GAAP Reconciliation.

(3)   Core return on average tangible stockholders’ equity is a non-GAAP financial measure. We compute our core return on average tangible stockholders’ equity as the ratio of core 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. For a reconciliation to the most directly comparable GAAP financial measure for core net income, see Table 14, GAAP to Non-GAAP Reconciliation.

(4)   Tangible book value is a non-GAAP financial measure. We compute our tangible book value as the ratio of tangible stockholders’ equity to shares outstanding. Tangible stockholders’ equity is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our total stockholders’ equity. For a reconciliation to the most directly comparable GAAP financial measure for core net income, 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)  2021 2021 2020 2021 2020
Interest income                 
Loans and lease financing  $ 110,919  $110,939  $122,298  $ 221,858  $257,269 
Available-for-sale securities    24,637   23,146   17,529    47,783   38,739 
Other    666   491   792    1,157   3,143 
Total interest income    136,222   134,576   140,619    270,798   299,151 
Interest expense                 
Deposits    3,363   4,056   8,583    7,419   24,183 
Short-term and long-term borrowings    1,378   1,362   4,214    2,740   8,463 
Total interest expense    4,741   5,418   12,797    10,159   32,646 
Net interest income    131,481   129,158   127,822    260,639   266,505 
Provision for credit losses    (35,000)     55,446    (35,000)  96,646 
Net interest income after provision for credit losses    166,481   129,158   72,376    295,639   169,859 
Noninterest income                 
Service charges on deposit accounts    6,632   6,718   5,927    13,350   14,877 
Credit and debit card fees    16,746   14,551   10,870    31,297   25,819 
Other service charges and fees    10,303   8,846   7,912    19,149   16,451 
Trust and investment services income    8,707   8,492   8,664    17,199   18,255 
Bank-owned life insurance    3,104   2,389   4,432    5,493   6,692 
Investment securities gains (losses), net    102      (211)   102   (126)
Other    3,777   2,872   8,062    6,649   12,916 
Total noninterest income    49,371   43,868   45,656    93,239   94,884 
Noninterest expense                 
Salaries and employee benefits    45,982   43,936   42,414    89,918   87,243 
Contracted services and professional fees    16,516   17,188   15,478    33,704   31,533 
Occupancy    7,314   7,170   7,302    14,484   14,545 
Equipment    6,362   5,491   5,207    11,853   9,915 
Regulatory assessment and fees    1,826   2,034   2,100    3,860   4,046 
Advertising and marketing    1,469   1,591   1,402    3,060   3,225 
Card rewards program    6,262   4,835   5,163    11,097   12,178 
Other    13,657   14,061   12,384    27,718   25,231 
Total noninterest expense    99,388   96,306   91,450    195,694   187,916 
Income before provision for income taxes    116,464   76,720   26,582    193,184   76,827 
Provision for income taxes    29,723   19,027   6,533    48,750   17,913 
Net income  $ 86,741  $57,693  $20,049  $ 144,434  $58,914 
Basic earnings per share  $ 0.67  $0.44  $0.15  $ 1.11  $0.45 
Diluted earnings per share  $ 0.67  $0.44  $0.15  $ 1.11  $0.45 
Basic weighted-average outstanding shares    129,392,339   129,933,104   129,856,730    129,661,228   129,876,218 
Diluted weighted-average outstanding shares    129,828,847   130,589,878   130,005,195    130,164,762   130,163,722 



             
Consolidated Balance Sheets Table 3
  June 30,  March 31,  December 31,  June 30, 
(dollars in thousands) 2021 2021 2020 2020
Assets            
Cash and due from banks $ 347,861  $278,994  $303,373  $347,592 
Interest-bearing deposits in other banks   1,558,437   983,816   737,571   1,507,630 
Investment securities, at fair value (amortized cost: $6,951,153 as of June 30, 2021, $6,708,431 as of March 31, 2021, $5,985,031 as of December 31, 2020 and $5,025,433 as of June 30, 2020)   6,953,930   6,692,479   6,071,415   5,135,775 
Loans held for sale   1,241   9,390   11,579   6,698 
Loans and leases   13,103,785   13,300,289   13,279,097   13,764,030 
Less: allowance for credit losses   169,148   200,366   208,454   192,120 
Net loans and leases   12,934,637   13,099,923   13,070,643   13,571,910 
             
Premises and equipment, net   319,452   319,949   322,401   322,919 
Other real estate owned and repossessed personal property           446 
Accrued interest receivable   66,734   69,879   69,626   58,420 
Bank-owned life insurance   466,402   468,927   466,537   458,720 
Goodwill   995,492   995,492   995,492   995,492 
Mortgage servicing rights   10,007   10,869   10,731   11,595 
Other assets   592,135   567,878   603,463   576,518 
Total assets $ 24,246,328  $23,497,596  $22,662,831  $22,993,715 
Liabilities and Stockholders' Equity            
Deposits:            
Interest-bearing $ 12,245,193  $11,958,606  $11,705,609  $12,481,543 
Noninterest-bearing   8,589,922   8,175,075   7,522,114   6,880,091 
Total deposits   20,835,115   20,133,681   19,227,723   19,361,634 
Short-term borrowings           200,000 
Long-term borrowings   200,000   200,010   200,010   200,019 
Retirement benefits payable   144,101   143,736   143,373   138,624 
Other liabilities   335,771   336,539   347,621   391,541 
Total liabilities   21,514,987   20,813,966   19,918,727   20,291,818 
             
Stockholders' equity            
Common stock ($0.01 par value; authorized 300,000,000 shares; issued/outstanding: 140,542,398 / 129,019,871 shares as of June 30, 2021, issued/outstanding: 140,455,180 / 129,749,890 shares as of March 31, 2021, issued/outstanding: 140,191,133 / 129,912,272 shares as of December 31, 2020 and issued/outstanding: 140,140,542 / 129,866,898 shares as of June 30, 2020)   1,405   1,405   1,402   1,401 
Additional paid-in capital   2,520,790   2,517,048   2,514,014   2,509,271 
Retained earnings   550,511   497,418   473,974   415,296 
Accumulated other comprehensive (loss) income, net   (29,702)  (43,435)  31,604   52,731 
Treasury stock (11,522,527 shares as of June 30, 2021, 10,705,290 shares as of March 31, 2021, 10,278,861 shares as of December 31, 2020 and 10,273,644 shares as of June 30, 2020)   (311,663)  (288,806)  (276,890)  (276,802)
Total stockholders' equity   2,731,341   2,683,630   2,744,104   2,701,897 
Total liabilities and stockholders' equity $ 24,246,328  $23,497,596  $22,662,831  $22,993,715 



                             
Average Balances and Interest Rates                         Table 4
  Three Months Ended  Three Months Ended  Three Months Ended  
  June 30, 2021 March 31, 2021 June 30, 2020 
  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 $ 1,503.0 $ 0.4  0.10 %  $938.7 $0.2 0.10 %$1,436.2 $0.4 0.10 %
Available-for-Sale Investment Securities                            
Taxable   6,298.3   22.5  1.43   5,949.9  22.1 1.49   4,389.7  17.5 1.60  
Non-Taxable   468.4   2.7  2.30   278.0  1.3 1.80   0.7   2.58  
Total Available-for-Sale Investment Securities   6,766.7   25.2  1.49   6,227.9  23.4 1.50   4,390.4  17.5 1.60  
Loans Held for Sale   2.0    1.44   9.2  0.1 2.46   9.8  0.1 2.93  
Loans and Leases(1)                            
Commercial and industrial   2,882.1   21.1  2.94   3,026.7  20.4 2.74   3,601.0  24.3 2.71  
Commercial real estate   3,419.7   25.3  2.97   3,385.2  24.9 2.98   3,438.8  28.3 3.31  
Construction   800.9   6.3  3.15   746.8  5.8 3.16   584.1  4.9 3.35  
Residential:                            
Residential mortgage   3,765.4   34.0  3.62   3,696.1  34.7 3.76   3,682.7  35.7 3.88  
Home equity line   812.6   5.5  2.72   822.0  5.7 2.80   885.2  6.8 3.07  
Consumer   1,277.9   16.9  5.32   1,323.7  17.7 5.43   1,526.5  20.6 5.42  
Lease financing   246.5   1.9  3.06   241.8  1.8 3.02   238.4  1.7 2.88  
Total Loans and Leases   13,205.1   111.0  3.37   13,242.3  111.0 3.39   13,956.7  122.3 3.52  
Other Earning Assets   62.5   0.3  1.91   58.0  0.3 1.79   61.7  0.4 2.79  
Total Earning Assets(2)   21,539.3   136.9  2.55   20,476.1  135.0 2.66   19,854.8  140.7 2.84  
Cash and Due from Banks   290.7        294.0        295.1       
Other Assets   2,185.1        2,174.6        2,191.8       
Total Assets $ 24,015.1       $22,944.7       $22,341.7       
                             
Interest-Bearing Liabilities                            
Interest-Bearing Deposits                            
Savings $ 6,361.8 $ 0.5  0.03 %  $5,975.1 $0.6 0.04 % 5,501.9 $0.9 0.07 %
Money Market   3,783.1   0.5  0.06   3,530.0  0.4 0.05   3,270.3  1.1 0.13  
Time   2,034.5   2.3  0.45   2,288.5  3.0 0.53   3,335.6  6.6 0.79  
Total Interest-Bearing Deposits   12,179.4   3.3  0.11   11,793.6  4.0 0.14   12,107.8  8.6 0.29  
Short-Term Borrowings              395.6  2.8 2.88  
Long-Term Borrowings   200.0   1.4  2.76   200.0  1.4 2.76   200.0  1.4 2.77  
Total Interest-Bearing Liabilities   12,379.4   4.7  0.15   11,993.6  5.4 0.18   12,703.4  12.8 0.41  
Net Interest Income    $ 132.2       $129.6       $127.9    
Interest Rate Spread        2.40 %        2.48 %      2.43 %
Net Interest Margin        2.46 %        2.55 %      2.58 %
Noninterest-Bearing Demand Deposits   8,458.6        7,709.5        6,432.6       
Other Liabilities   485.1        513.9        507.9       
Stockholders' Equity   2,692.0        2,727.7        2,697.8       
Total Liabilities and Stockholders' Equity $ 24,015.1       $22,944.7       $22,341.7       

________________________
(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 $0.7 million, $0.4 million and $0.1 million for the three months ended June 30, 2021, March 31, 2021 and June 30, 2020, respectively.



                    
Average Balances and Interest Rates                Table 5
  Six Months Ended  Six Months Ended  
  June 30, 2021 June 30, 2020 
  Average Income/ Yield/
 Average Income/ Yield/
 
(dollars in millions) Balance Expense Rate
 Balance Expense Rate
 
Earning Assets                   
Interest-Bearing Deposits in Other Banks $ 1,222.4 $ 0.6  0.10 %  $976.5 $2.0 0.40 %
Available-for-Sale Investment Securities                   
Taxable   6,125.1   44.6  1.46   4,211.4  38.7 1.84  
Non-Taxable   373.7   4.0  2.11   0.4   2.58  
Total Available-for-Sale Investment Securities   6,498.8   48.6  1.49   4,211.8  38.7 1.84  
Loans Held for Sale   5.6   0.1  2.28   12.8  0.1 2.17  
Loans and Leases(1)                   
Commercial and industrial   2,954.0   41.5  2.84   3,188.4  48.9 3.08  
Commercial real estate   3,402.6   50.2  2.98   3,426.3  62.9 3.69  
Construction   774.0   12.1  3.16   561.5  10.6 3.79  
Residential:                   
Residential mortgage   3,730.9   68.7  3.68   3,711.5  73.4 3.95  
Home equity line   817.3   11.2  2.76   886.3  14.5 3.28  
Consumer   1,300.7   34.7  5.37   1,569.2  43.6 5.59  
Lease financing   244.1   3.7  3.04   230.8  3.3 2.90  
Total Loans and Leases   13,223.6   222.1  3.38   13,574.0  257.2 3.80  
Other Earning Assets   60.2   0.5  1.85   59.4  1.2 3.99  
Total Earning Assets(2)   21,010.6   271.9  2.60   18,834.5  299.2 3.19  
Cash and Due from Banks   292.3        311.2       
Other Assets   2,179.9        2,181.8       
Total Assets $ 23,482.8       $21,327.5       
                    
Interest-Bearing Liabilities                   
Interest-Bearing Deposits                   
Savings $ 6,169.5 $ 1.1  0.04 %  $5,296.1 $4.2 0.16 %
Money Market   3,657.3   1.0  0.05   3,167.6  5.7 0.36  
Time   2,160.8   5.3  0.49   2,935.1  14.3 0.98  
Total Interest-Bearing Deposits   11,987.6   7.4  0.12   11,398.8  24.2 0.43  
Short-Term Borrowings        398.6  5.7 2.88  
Long-Term Borrowings   200.0   2.7  2.76   200.0  2.7 2.77  
Total Interest-Bearing Liabilities   12,187.6   10.1  0.17   11,997.4  32.6 0.55  
Net Interest Income    $ 261.8       $266.6    
Interest Rate Spread        2.43 %        2.64 %
Net Interest Margin        2.50 %        2.84 %
Noninterest-Bearing Demand Deposits   8,086.1        6,143.0       
Other Liabilities   499.4        507.8       
Stockholders' Equity   2,709.7        2,679.3       
Total Liabilities and Stockholders' Equity $ 23,482.8       $21,327.5       

________________________
(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 $1.1 million and $0.1 million for the six months ended June 30, 2021 and 2020, respectively.



          
Analysis of Change in Net Interest Income        Table 6
  Three Months Ended June 30, 2021
  Compared to March 31, 2021
(dollars in millions) Volume Rate Total
Change in Interest Income:         
Interest-Bearing Deposits in Other Banks $ 0.2  $  $ 0.2 
Available-for-Sale Investment Securities         
Taxable   1.3    (0.9)   0.4 
Non-Taxable   1.0    0.4    1.4 
Total Available-for-Sale Investment Securities   2.3    (0.5)   1.8 
Loans Held for Sale   (0.1)      (0.1)
Loans and Leases         
Commercial and industrial   (0.9)   1.6    0.7 
Commercial real estate   0.4       0.4 
Construction   0.5       0.5 
Residential:         
Residential mortgage   0.6    (1.3)   (0.7)
Home equity line   (0.1)   (0.1)   (0.2)
Consumer   (0.5)   (0.3)   (0.8)
Lease financing   0.1       0.1 
Total Loans and Leases   0.1    (0.1)   
Total Change in Interest Income   2.5    (0.6)   1.9 
          
Change in Interest Expense:         
Interest-Bearing Deposits         
Savings      (0.1)   (0.1)
Money Market      0.1    0.1 
Time   (0.3)   (0.4)   (0.7)
Total Interest-Bearing Deposits   (0.3)   (0.4)   (0.7)
Total Change in Interest Expense   (0.3)   (0.4)   (0.7)
Change in Net Interest Income $ 2.8  $ (0.2) $ 2.6 



          
Analysis of Change in Net Interest Income        Table 7
  Three Months Ended June 30, 2021
  Compared to June 30, 2020
(dollars in millions) Volume Rate Total
Change in Interest Income:         
Available-for-Sale Investment Securities         
Taxable $ 7.0  $ (2.0) $ 5.0 
Non-Taxable   2.7       2.7 
Total Available-for-Sale Investment Securities   9.7    (2.0)   7.7 
Loans Held for Sale   (0.1)      (0.1)
Loans and Leases         
Commercial and industrial   (5.2)   2.0    (3.2)
Commercial real estate   (0.1)   (2.9)   (3.0)
Construction   1.7    (0.3)   1.4 
Residential:         
Residential mortgage   0.8    (2.5)   (1.7)
Home equity line   (0.5)   (0.8)   (1.3)
Consumer   (3.3)   (0.4)   (3.7)
Lease financing   0.1    0.1    0.2 
Total Loans and Leases   (6.5)   (4.8)   (11.3)
Other Earning Assets      (0.1)   (0.1)
Total Change in Interest Income   3.1    (6.9)   (3.8)
          
Change in Interest Expense:         
Interest-Bearing Deposits         
Savings   0.1    (0.5)   (0.4)
Money Market   0.1    (0.7)   (0.6)
Time   (2.0)   (2.3)   (4.3)
Total Interest-Bearing Deposits   (1.8)   (3.5)   (5.3)
Short-Term Borrowings   (1.4)   (1.4)   (2.8)
Total Change in Interest Expense   (3.2)   (4.9)   (8.1)
Change in Net Interest Income $ 6.3  $ (2.0) $ 4.3 



          
Analysis of Change in Net Interest Income        Table 8
  Six Months Ended June 30, 2021
  Compared to June 30, 2020
(dollars in millions) Volume Rate Total
Change in Interest Income:         
Interest-Bearing Deposits in Other Banks $ 0.3  $ (1.7) $ (1.4)
Available-for-Sale Investment Securities         
Taxable   15.0    (9.1)   5.9 
Non-Taxable   4.0       4.0 
Total Available-for-Sale Investment Securities   19.0    (9.1)   9.9 
Loans and Leases         
Commercial and industrial   (3.6)   (3.8)   (7.4)
Commercial real estate   (0.4)   (12.3)   (12.7)
Construction   3.5    (2.0)   1.5 
Residential:         
Residential mortgage   0.4    (5.1)   (4.7)
Home equity line   (1.1)   (2.2)   (3.3)
Consumer   (7.3)   (1.6)   (8.9)
Lease financing   0.2    0.2    0.4 
Total Loans and Leases   (8.3)   (26.8)   (35.1)
Other Earning Assets      (0.7)   (0.7)
Total Change in Interest Income   11.0    (38.3)   (27.3)
          
Change in Interest Expense:         
Interest-Bearing Deposits         
Savings   0.5    (3.6)   (3.1)
Money Market   0.8    (5.5)   (4.7)
Time   (3.1)   (5.9)   (9.0)
Total Interest-Bearing Deposits   (1.8)   (15.0)   (16.8)
Short-Term Borrowings   (2.8)   (2.9)   (5.7)
Total Change in Interest Expense   (4.6)   (17.9)   (22.5)
Change in Net Interest Income $ 15.6  $ (20.4) $ (4.8)



             
Loans and Leases           Table 9
  June 30,  March 31,  December 31,  June 30, 
(dollars in thousands) 2021    2021    2020    2020
Commercial and industrial:            
Commercial and industrial excluding Paycheck Protection Program loans $ 1,753,444 $1,962,672 $2,218,266 $2,507,312
Paycheck Protection Program loans   811,103  1,158,764  801,241  916,396
Total commercial and industrial   2,564,547  3,121,436  3,019,507  3,423,708
Commercial real estate   3,528,068  3,396,233  3,392,676  3,423,499
Construction   853,865  739,271  735,819  617,935
Residential:            
Residential mortgage   3,821,407  3,715,676  3,690,218  3,691,950
Home equity line   825,368  805,746  841,624  876,491
Total residential   4,646,775  4,521,422  4,531,842  4,568,441
Consumer   1,267,559  1,283,779  1,353,842  1,492,160
Lease financing   242,971  238,148  245,411  238,287
Total loans and leases $ 13,103,785 $13,300,289 $13,279,097 $13,764,030



              
Deposits            Table 10
   June 30,  March 31,  December 31,  June 30, 
(dollars in thousands)  2021    2021    2020    2020
Demand  $ 8,589,922 $8,175,075 $7,522,114 $6,880,091
Savings    6,421,053  6,141,161  6,020,075  5,727,367
Money Market    3,920,477  3,642,604  3,337,236  3,247,511
Time    1,903,663  2,174,841  2,348,298  3,506,665
Total Deposits  $ 20,835,115 $20,133,681 $19,227,723 $19,361,634



              
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)  2021    2021    2020    2020
Non-Performing Assets             
Non-Accrual Loans and Leases             
Commercial Loans:             
Commercial and industrial  $ 828 $593 $518 $11,559
Commercial real estate    937  937  80  13,168
Construction     579  2,043  2,043
Total Commercial Loans    1,765  2,109  2,641  26,770
Residential Loans:             
Residential mortgage    7,140  6,999  6,441  6,059
Total Residential Loans    7,140  6,999  6,441  6,059
Total Non-Accrual Loans and Leases    8,905  9,108  9,082  32,829
Other Real Estate Owned         446
Total Non-Performing Assets  $ 8,905 $9,108 $9,082 $33,275
              
Accruing Loans and Leases Past Due 90 Days or More             
Commercial Loans:             
Commercial and industrial  $ 494 $1,365 $2,108 $2,309
Commercial real estate     1,054  882  900
Construction    60  89  93  248
Total Commercial Loans    554  2,508  3,083  3,457
Residential Loans:             
Home equity line    4,680  4,975  4,818  4,496
Total Residential Loans    4,680  4,975  4,818  4,496
Consumer    1,134  2,024  3,266  2,167
Total Accruing Loans and Leases Past Due 90 Days or More  $ 6,368 $9,507 $11,167 $10,120
              
Restructured Loans on Accrual Status and Not Past Due 90 Days or More  $ 36,668 $39,831 $16,684 $11,182
Total Loans and Leases  $ 13,103,785 $13,300,289 $13,279,097 $13,764,030



                 
Allowance for Credit Losses             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) 2021 2021    2020    2021 2020 
Balance at Beginning of Period $ 200,366  $208,454  $166,013  $ 208,454  $130,530  
Adjustment to Adopt ASC Topic 326              770  
After Adoption of ASC Topic 326   200,366   208,454   166,013    208,454   131,300  
Loans and Leases Charged-Off                
Commercial Loans:                
Commercial and industrial   (330)  (963)  (13,974)   (1,293)  (14,175) 
Commercial real estate     (66)  (2,723)   (66)  (2,723) 
Construction        (379)     (379) 
Total Commercial Loans   (330)  (1,029)  (17,076)   (1,359)  (17,277) 
Residential Loans:                
Residential mortgage     (98)  (14)   (98)  (14) 
Home equity line              (8) 
Total Residential Loans     (98)  (14)   (98)  (22) 
Consumer   (3,917)  (6,541)  (8,907)   (10,458)  (17,504) 
Total Loans and Leases Charged-Off   (4,247)  (7,668)  (25,997)   (11,915)  (34,803) 
Recoveries on Loans and Leases Previously Charged-Off                
Commercial Loans:                
Commercial and industrial   287   215   100    502   320  
Commercial real estate   12   3       15     
Construction     166   30    166   140  
Total Commercial Loans   299   384   130    683   460  
Residential Loans:                
Residential mortgage   14   17   17    31   152  
Home equity line   38   24   8    62   130  
Total Residential Loans   52   41   25    93   282  
Consumer   2,797   2,655   2,456    5,452   4,539  
Total Recoveries on Loans and Leases Previously Charged-Off   3,148   3,080   2,611    6,228   5,281  
Net Loans and Leases Charged-Off   (1,099)  (4,588)  (23,386)   (5,687)  (29,522) 
Provision for Credit Losses - Loans and Leases   (30,119)  (3,500)  49,493    (33,619)  90,342  
Balance at End of Period $ 169,148  $200,366  $192,120  $ 169,148  $192,120  
Average Loans and Leases Outstanding $ 13,205,086  $13,242,270  $13,956,669  $ 13,223,575  $13,574,048  
Ratio of Net Loans and Leases Charged-Off to Average Loans and Leases Outstanding(1)   0.03 %   0.14 % 0.67 %  0.09 %   0.44 %
Ratio of Allowance for Credit Losses for Loans and Leases to Loans and Leases Outstanding   1.29 %   1.51 % 1.40 %  1.29 %   1.40 %

________________________
(1)   Annualized for the three and six months ended June 30, 2021 and 2020 and three months ended March 31, 2021.


                            
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) 2021 2020 2019 2018 2017 Prior Cost Basis Cost Basis Total
Commercial Lending                           
Commercial and Industrial                           
Risk rating:                           
Pass $ 606,765 $ 422,457 $ 242,554 $ 136,069 $ 48,828 $ 207,502 $ 674,340 $ 23,935 $ 2,362,450
Special Mention   122   8,994   33,617   12,735   1,425   4,647   14,338   376   76,254
Substandard     7,149   2,400   16,246   137   8,731   6,397   1,344   42,404
Other (1)   9,812   8,774   10,337   6,632   3,531   965   43,388     83,439
Total Commercial and Industrial   616,699   447,374   288,908   171,682   53,921   221,845   738,463   25,655   2,564,547
                            
Commercial Real Estate                           
Risk rating:                           
Pass   288,366   342,013   571,608   557,533   449,551   1,055,803   63,775   2   3,328,651
Special Mention     1,482   52,852   16,081   33,022   55,933   7,604     166,974
Substandard     411     7,016   2,069   21,962   502     31,960
Other (1)             483       483
Total Commercial Real Estate   288,366   343,906   624,460   580,630   484,642   1,134,181   71,881   2   3,528,068
                            
Construction                           
Risk rating:                           
Pass   49,592   97,149   296,405   173,352   62,983   70,998   55,892     806,371
Special Mention       494   705     361       1,560
Substandard         373     1,378       1,751
Other (1)   11,829   15,036   5,247   5,381   2,953   2,930   807     44,183
Total Construction   61,421   112,185   302,146   179,811   65,936   75,667   56,699     853,865
                            
Lease Financing                           
Risk rating:                           
Pass   21,690   69,598   55,494   11,376   16,623   60,091       234,872
Special Mention   545   308   465   246   81   232       1,877
Substandard     2,720   1,668   260   1,072   502       6,222
Total Lease Financing   22,235   72,626   57,627   11,882   17,776   60,825       242,971
                            
Total Commercial Lending $ 988,721 $ 976,091 $ 1,273,141 $ 944,005 $ 622,275 $ 1,492,518 $ 867,043 $ 25,657 $ 7,189,451


                            
                       Revolving   
                       Loans   
                       Converted   
  Term Loans Revolving to Term   
  Amortized Cost Basis by Origination Year Loans Loans   
(continued)                   Amortized Amortized   
(dollars in thousands) 2021 2020 2019 2018 2017 Prior Cost Basis Cost Basis Total
Residential Lending                           
Residential Mortgage                           
FICO:                           
740 and greater $ 570,542 $ 675,163 $ 329,047 $ 224,827 $ 293,853 $ 958,515 $ $ $ 3,051,947
680 - 739   68,225   86,857   50,699   43,075   42,753   144,223       435,832
620 - 679   11,867   12,564   9,988   6,352   9,310   41,478       91,559
550 - 619     1,018   171   1,322   1,752   11,788       16,051
Less than 550     1,274     346   2,545   2,807       6,972
No Score (3)   10,207   8,602   15,988   21,087   18,814   51,217       125,915
Other (2)   10,440   17,605   12,917   11,910   19,349   20,130   625   155   93,131
Total Residential Mortgage   671,281   803,083   418,810   308,919   388,376   1,230,158   625   155   3,821,407
                            
Home Equity Line                           
FICO:                           
740 and greater               610,924   1,757   612,681
680 - 739               147,286   3,619   150,905
620 - 679               39,660   2,036   41,696
550 - 619               12,966   1,256   14,222
Less than 550               2,025   47   2,072
No Score (3)               3,792     3,792
Total Home Equity Line               816,653   8,715   825,368
Total Residential Lending   671,281   803,083   418,810   308,919   388,376   1,230,158   817,278   8,870   4,646,775
                            
Consumer Lending                           
FICO:                           
740 and greater   82,086   97,867   100,874   77,671   38,340   16,537   112,925   284   526,584
680 - 739   50,771   70,303   73,024   48,071   26,097   12,183   70,627   747   351,823
620 - 679   21,372   31,170   37,145   25,852   17,799   9,120   31,515   1,258   175,231
550 - 619   2,887   9,729   17,206   14,016   11,217   6,263   10,652   1,234   73,204
Less than 550   322   3,826   6,934   5,439   3,757   2,295   3,184   748   26,505
No Score (3)   834   63   85   51   87