Shareholders’ Equity and Earnings Per Share

Series D Preferred Stock

In June 2015, the Company issued and sold 5,000,000 shares of fixed-to-floating non-cumulative perpetual preferred stock, Series D, liquidation preference $25 per share (the “Series D Preferred Stock”) for $125.0 million in a public offering. When, as and if declared, dividends on the Series D Preferred Stock are payable quarterly in arrears at a fixed rate of 6.50% per annum from the original issuance date to, but excluding, July 15, 2025, and from (and including) that date at a floating rate equal to three-month LIBOR plus a spread of 4.06% per annum.

Common Stock Warrant

Pursuant to the U.S. Department of the Treasury’s (the “U.S. Treasury”) Capital Purchase Program, on December 19, 2008, the Company issued to the U.S. Treasury a warrant to exercise 1,643,295 warrant shares of Wintrust common stock with a term of 10 years. In February 2011, the U.S. Treasury sold all of its interest in the warrant issued to it in a secondary underwritten public offering. During 2018, certain holders of the interest in the warrant exercised 22,952 warrant shares, which resulted in 16,571 shares of common stock issued. On December 19, 2018, the Company’s warrant shares expired. Any warrant shares not exercised prior to this date expired and became void, and the holder did not receive any shares of the Company’s common stock.

Other

At the January 2019 Board of Directors meeting, a quarterly cash dividend of $0.25 per share ($1.00 on an annualized basis) was declared. It was paid on February 21, 2019 to shareholders of record as of February 7, 2019.

Accumulated Other Comprehensive Income (Loss)

The following tables summarize the components of other comprehensive income (loss), including the related income tax effects, and the related amount reclassified to net income for the periods presented (in thousands).



	Accumulated Unrealized Losses on Securities			Accumulated Unrealized Gains on Derivative Instruments			Accumulated Foreign Currency Translation Adjustments			Total Accumulated Other Comprehensive Loss
Balance at January 1, 2019	$	(42,353	)	$	7,857		$	(42,376	)	$	(76,872	)
Other comprehensive income (loss) during the period, net of tax, before reclassifications	27,956			(1,039		)	2,277			29,194
Amount reclassified from accumulated other comprehensive loss into net income, net of tax	49			(2,612		)	—			(2,563		)
Amount reclassified from accumulated other comprehensive loss related to amortization of unrealized losses on investment securities transferred to held-to-maturity from available-for-sale, net of tax	(103		)	—			—			(103		)
Net other comprehensive income (loss) during the period, net of tax	$	27,902		$	(3,651	)	$	2,277		$	26,528
Balance at March 31, 2019	$	(14,451	)	$	4,206		$	(40,099	)	$	(50,344	)


	Accumulated Unrealized Losses on Securities			Accumulated Unrealized Gains on Derivative Instruments			Accumulated Foreign Currency Translation Adjustments			Total Accumulated Other Comprehensive Loss
Balance at January 1, 2018	$	(15,813	)	$	7,164		$	(33,186	)	$	(41,835	)
Cumulative effect adjustment from the adoption of:
ASU 2016-01	(1,880		)	—			—			(1,880		)
ASU 2018-02	(4,517		)	1,543			—			(2,974		)
Other comprehensive (loss) income during the period, net of tax, before reclassifications	(26,474		)	2,746			(2,897		)	(26,625		)
Amount reclassified from accumulated other comprehensive loss into net income, net of tax	713			(497		)	—			216
Amount reclassified from accumulated other comprehensive loss related to amortization of unrealized losses on investment securities transferred to held-to-maturity from available-for-sale, net of tax	3			—			—			3
Net other comprehensive (loss) income during the period, net of tax	$	(25,758	)	$	2,249		$	(2,897	)	$	(26,406	)
Balance at March 31, 2018	$	(47,968	)	$	10,956		$	(36,083	)	$	(73,095	)



	Amount Reclassified from Accumulated Other Comprehensive Income for the
Details Regarding the Component of Accumulated Other Comprehensive Income	Three Months Ended						Impacted Line on the Consolidated Statements of Income
	March 31,
	2019			2018
Accumulated unrealized losses on securities
Losses included in net income	$	(67	)	$	(975	)	Gains (losses) on investment securities, net
	(67		)	(975		)	Income before taxes
Tax effect	$	18		$	262		Income tax expense
Net of tax	$	(49	)	$	(713	)	Net income

Accumulated unrealized losses on derivative instruments
Amount reclassified to interest expense on deposits	$	(3,589	)	$	(680	)	Interest on deposits
Amount reclassified to interest expense on other borrowings	27			—			Interest on other borrowings
	3,562			680			Income before taxes
Tax effect	$	(950	)	$	(183	)	Income tax expense
Net of tax	$	2,612		$	497		Net income

Earnings per Share

The following table shows the computation of basic and diluted earnings per share for the periods indicated:



		Three Months Ended
(In thousands, except per share data)		March 31, 2019		March 31, 2018
Net income		$	89,146	$	81,981
Less: Preferred stock dividends		2,050		2,050
Net income applicable to common shares	(A)	87,096		79,931
Weighted average common shares outstanding	(B)	56,529		56,137
Effect of dilutive potential common shares
Common stock equivalents		699		888
Weighted average common shares and effect of dilutive potential common shares	(C)	57,228		57,025
Net income per common share:
Basic	(A/B)	$	1.54	$	1.42
Diluted	(A/C)	$	1.52	$	1.40

Potentially dilutive common shares can result from stock options, restricted stock unit awards, stock warrants and shares to be issued under the Employee Stock Purchase Plan and the Directors Deferred Fee and Stock Plan, being treated as if they had been either exercised or issued, computed by application of the treasury stock method. While potentially dilutive common shares are typically included in the computation of diluted earnings per share, potentially dilutive common shares are excluded from this computation in periods in which the effect would reduce the loss per share or increase the income per share.