Exhibit

EXHIBIT 99.1

SOUTHSIDE BANCSHARES, INC.

ANNOUNCES FINANCIAL RESULTS FOR THE

FOURTH QUARTER AND YEAR ENDED DECEMBER 31, 2019


•	Linked quarter loans increased $68.3 million, or 2.0%, to $3.57 billion from $3.50 billion


•	Linked quarter nonperforming assets as a percent of total assets decreased from 0.45% to 0.26%


•	Fourth quarter net income was $17.3 million and earnings per diluted common share were $0.51


•	Fourth quarter annualized return on average assets of 1.03%

Tyler, Texas, (January 31, 2020) Southside Bancshares, Inc. (“Southside” or the “Company”) (NASDAQ:SBSI) today reported its financial results for the quarter and year ended December 31, 2019. Southside reported net income of $17.3 million for the three months ended December 31, 2019, a decrease of $46,000, or 0.3%, compared to $17.4 million for the same period in 2018. Earnings per diluted common share increased $0.01, or 2.0%, to $0.51 for the three months ended December 31, 2019, from $0.50 for the same period in 2018. The annualized return on average shareholders’ equity for the three months ended December 31, 2019 was 8.42%, compared to 9.30% for the same period in 2018. The annualized return on average assets was 1.03% for the three months ended December 31, 2019, compared to 1.14% for the same period in 2018.

“I am pleased to report Southside enjoyed a solid year in 2019, as earnings per share increased 4.3% to $2.20, loan growth of 7.7%, or $255.4 million, exceeding our original projections, and nonaccrual loans decreased 86.1%, or $30.8 million,” stated Lee R. Gibson, President and Chief Executive Officer of Southside. “At December 31, 2019, our nonperforming assets to total assets ratio decreased to 0.26%.”

“For the quarter ended December 31, 2019, provision for loan losses increased $1.5 million on a linked quarter basis largely due to a partial charge-off of a previously reported nonaccrual loan that paid off in the fourth quarter. Linked quarter, our net interest spread and margin declined two and five basis points, respectively, primarily due to securities increasing more than loans and representing a larger percentage of average earning assets when compared to the third quarter.”

“In November we opened our 60^th branch location in Kingwood, just north of Houston. We have loaned into the Houston market for several years and have recently hired a commercial lender designated to this market. In addition, we anticipate filing an application to open a loan production office within the greater Houston area, which is subject to regulatory approval.”

“The Texas economy remains strong as company relocations and expansions continue to drive both job and population growth.”

Operating Results for the Three Months Ended December 31, 2019

Net income was $17.3 million for the three months ended December 31, 2019, compared to $17.4 million for the same period in 2018, a decrease of $46,000, or 0.3%. Earnings per diluted common share were $0.51 for the three months ended December 31, 2019, compared to $0.50 for the same period in 2018. Annualized returns on average assets and average shareholders’ equity for the three months ended December 31, 2019 were 1.03% and 8.42%, respectively. Our efficiency ratio (FTE) was 53.87%⁽¹⁾ for the three months ended December 31, 2019, compared to 50.53% for the three months ended September 30, 2019.

Net interest income for the three months ended December 31, 2019 was $43.2 million compared to $42.4 million for the same period in 2018. Linked quarter, net interest income increased $0.8 million, or 1.9%, compared to $42.4 million during the three months ended September 30, 2019. The increase in net interest income for the linked quarter was due to the decrease in interest expense on our interest bearing liabilities, a result of a decrease in average rate paid on our interest bearing liabilities during the three months ended December 31, 2019.

Our tax equivalent net interest margin was 2.98% for the three months ended December 31, 2019 compared to 3.21% for the same period in 2018. The decrease was due to a decrease in average yield on interest earning assets of 20 basis points and an increase in average interest bearing liabilities, partially offset by an increase in interest earnings assets. The average rate paid on interest bearing liabilities was 1.46% for the three months ended December 31, 2019 and 2018. Our tax equivalent net interest margin decreased 5 basis points compared to 3.03% for the three months ended September 30, 2019. This decrease was due to a decrease in the average yield on interest earning assets of 16 basis points and the increase in average interest bearing liabilities.

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Noninterest income was $10.5 million for the three months ended December 31, 2019, an increase of 3.3%, compared to $10.1 million for the same period in 2018. The increase was primarily due to an increase in deposit services income and trust fees. On a linked quarter basis, noninterest income decreased $0.6 million, or 5.8%, primarily due to a decrease in swap fee income and fair value of written loan commitments, both included in other noninterest income.

Noninterest expense was $30.9 million for the three months ended December 31, 2019, an increase of 2.5%, compared to $30.2 million for the same period in 2018. The increase was due to an increase in salaries and employee benefits, partially offset by decreases in net occupancy expense and FDIC insurance expense. On a linked quarter basis, noninterest expense increased $1.9 million, or 6.6%, compared to the three months ended September 30, 2019. The $1.0 million increase in salaries and employee benefits was primarily related to employee benefits, which included $0.6 million of increase in health insurance expense and $0.2 million in salaries and payroll taxes. Additionally, we incurred losses on the disposition of certain assets of approximately $0.6 million, included in other noninterest expense.

Income tax expense increased $0.3 million for the three months ended December 31, 2019 compared to the same period in 2018. On a linked quarter basis, income tax expense decreased $0.8 million. Our effective tax rate (“ETR”) increased to 14.1% for the three months ended December 31, 2019 compared to 12.7% for the three months ended December 31, 2018 and decreased compared to 15.6% for the three months ended September 30, 2019. The higher ETR for the three months ended December 31, 2019, as compared to the same period in 2018, was primarily due to a decrease in tax-exempt income as a percentage of pre-tax income for the three months ended December 31, 2019.

Operating Results for the Year Ended December 31, 2019

Net income was $74.6 million for the year ended December 31, 2019 compared to $74.1 million for the same period in 2018, an increase of $0.4 million, or 0.6%. Earnings per diluted common share was $2.20 for the year ended December 31, 2019 compared to $2.11 for the same period in 2018, an increase of 4.3%. The increase in net income was largely driven by increases in interest income and the net gain on the sale of available for sale securities, as well as the decrease in provision for loan losses, partially offset by an increase in interest expense and income tax expense. Returns on average assets and average shareholders’ equity for the year ended December 31, 2019 were 1.17% and 9.53%, respectively. Our efficiency ratio (FTE) was 52.36%⁽¹⁾ for the year ended December 31, 2019.

Net interest income for the year ended December 31, 2019 was $169.8 million, compared to $172.1 million during the same period in 2018, a decrease of $2.3 million, or 1.3%. The decrease in net interest income was due to an increase in interest expense, a result of the higher funding costs of our interest bearing liabilities and, to a lesser extent, an increase in the average balance of our interest bearing liabilities. The increase in interest expense was partially offset by the increase in interest income on our interest earning assets, a result of higher interest rates and a shift in the mix of earning assets.

Our tax equivalent net interest margin was 3.06% for the year ended December 31, 2019, compared to 3.18% for the same period in 2018. The decrease was primarily due to the higher rates paid on interest bearing liabilities and the increase in average interest bearing liabilities.

Noninterest income was $42.4 million for the year ended December 31, 2019, an increase of 3.9%, compared to $40.8 million for the same period in 2018. The increase was primarily due to an increase in net gain on sale of securities available for sale and deposit services income, partially offset by decreases in other noninterest income, bank owned life insurance, trust fees and gain on sale of loans.

Noninterest expense was $119.3 million for the year ended December 31, 2019, compared to $120.1 million for the same period in 2018, a decrease of $0.8 million, or 0.7%. The decrease was primarily due to a decrease in acquisition expense, FDIC insurance, amortization of intangibles and net occupancy expense, partially offset by increases in salaries and employee benefits, professional fees and software and data processing expense.

Income tax expense increased $3.1 million for the year ended December 31, 2019, compared to the same period in 2018. Our ETR was approximately 15.1% and 12.1% for the years ended December 31, 2019 and 2018, respectively. The higher ETR for the year ended December 31, 2019, as compared to the same period in 2018, was primarily due to a decrease in tax-exempt income as a percentage of pre-tax income for the year ended December 31, 2019 and a discrete tax benefit of approximately $0.8 million recorded in 2018 associated with the remeasurement of our net deferred tax asset.

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Balance Sheet Data

At December 31, 2019, we had $6.75 billion in total assets, compared to $6.12 billion at December 31, 2018 and $6.54 billion at September 30, 2019.

Loans at December 31, 2019 were $3.57 billion, an increase of $255.4 million, or 7.7%, compared to $3.31 billion at December 31, 2018. Linked quarter loans increased $68.3 million, or 2.0%, from $3.50 billion at September 30, 2019. The linked quarter net increase in our loans consisted of increases of $23.9 million of construction loans, $19.4 million of commercial loans, $17.1 million of municipal loans and $13.9 million of commercial real estate loans, partially offset by decreases of $5.1 million of 1-4 family residential loans and $0.9 million of loans to individuals.

Securities at December 31, 2019 were $2.49 billion, an increase of $341.1 million, or 15.8%, compared to $2.15 billion at December 31, 2018. Linked quarter securities increased $112.1 million, or 4.7%, from $2.38 billion at September 30, 2019.

Deposits at December 31, 2019 were $4.70 billion, an increase of $277.7 million, or 6.3%, compared to $4.43 billion at December 31, 2018. Linked quarter deposits increased $212.0 million, or 4.7%, from $4.49 billion at September 30, 2019, primarily due to an increase in public fund deposits, partially offset by decreases in brokered deposits.

Asset Quality

Nonperforming assets at December 31, 2019 were $17.4 million, or 0.26% of total assets, a decrease of $25.5 million, or 59.3%, compared to $42.9 million, or 0.70% of total assets, at December 31, 2018, and a decrease of $12.3 million, or 41.3%, from $29.7 million, or 0.45% of total assets, at September 30, 2019. During the three months ended December 31, 2019, our nonaccrual loans decreased $12.2 million, or 71.1%.

The allowance for loan losses decreased to $24.8 million, or 0.69% of total loans, at December 31, 2019 compared to $27.0 million, or 0.82% of total loans, at December 31, 2018, due to a partial reversal of provision during the first quarter of 2019 associated with the sale of three large nonaccrual commercial real estate loans and a decrease in our classified loans during 2019, partially offset by growth in the loan portfolio. The allowance for loan losses at September 30, 2019 was $25.1 million, or 0.72% of total loans.

For the three months ended December 31, 2019, we recorded provision for loan losses of $2.5 million, compared to $2.4 million for the three months ended December 31, 2018 and $1.0 million for the three months ended September 30, 2019. The provision for loan losses for the year ended December 31, 2019 was $5.1 million, compared to $8.4 million for the year ended December 31, 2018.

Net charge-offs were $2.8 million for the three months ended December 31, 2019, compared to net charge-offs of $1.5 million for the three months ended December 31, 2018 and $0.6 million net charge-offs for the three months ended September 30, 2019. Net charge-offs were $7.3 million for the year ended December 31, 2019, compared to $2.2 million for the year ended December 31, 2018.

Dividend

Southside Bancshares, Inc. declared a fourth quarter cash dividend of $0.31 and a special cash dividend of $0.03 per share on November 7, 2019, which was paid on December 12, 2019, to all shareholders of record as of November 27, 2019.

_______________

(1) Refer to “Non-GAAP Financial Measures” below and to “Non-GAAP Reconciliation” at the end of the financial statement tables in this Earnings Release for a reconciliation of this non-GAAP financial measure to the nearest GAAP financial measure.

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Conference Call

Southside's management team will host a conference call to discuss its fourth quarter and year ended December 31, 2019 financial results on Friday, January 31, 2020 at 9:00 a.m. CST. The call can be accessed by dialing 844-775-2540 and by identifying the conference ID number 1545889 or by identifying “Southside Bancshares, Inc., Fourth Quarter and Year End 2019 Earnings Call.” To listen to the call via webcast, register at https://investors.southside.com.

For those unable to listen to the conference call live, a recording will be available from approximately 12:00 p.m. CST January 31, 2020 through 12:00 p.m. CST February 12, 2020 by accessing the company website, https://investors.southside.com.

Non-GAAP Financial Measures

Our accounting and reporting policies conform to generally accepted accounting principles (“GAAP”) in the United States and prevailing practices in the banking industry. However, certain non-GAAP measures are used by management to supplement the evaluation of our performance. These include the following fully taxable-equivalent measures (“FTE”): (i) Net interest income (FTE), (ii) Net interest margin (FTE), (iii) Net interest spread (FTE), and (iv) Efficiency ratio (FTE), which include the effects of taxable-equivalent adjustments using a federal income tax rate of 21% for the year ended December 31, 2019 and 2018 to increase tax-exempt interest income to a tax-equivalent basis. Interest income earned on certain assets is completely or partially exempt from federal income tax. As such, these tax-exempt instruments typically yield lower returns than taxable investments.

Net interest income (FTE), Net interest margin (FTE) and Net interest spread (FTE). Net interest income (FTE) is a non-GAAP measure that adjusts for the tax-favored status of net interest income from certain loans and investments. We believe this measure to be the preferred industry measurement of net interest income and it enhances comparability of net interest income arising from taxable and tax-exempt sources. The most directly comparable financial measure calculated in accordance with GAAP is our net interest income. Net interest margin (FTE) is the ratio of net interest income (FTE) to average earning assets. The most directly comparable financial measure calculated in accordance with GAAP is our net interest margin. Net interest spread (FTE) is the difference in the average yield on average earning assets on a tax-equivalent basis and the average rate paid on average interest bearing liabilities. The most directly comparable financial measure calculated in accordance with GAAP is our net interest spread.

Efficiency ratio (FTE). The efficiency ratio (FTE) is a non-GAAP measure that provides a measure of productivity in the banking industry. This ratio is calculated to measure the cost of generating one dollar of revenue. The ratio is designed to reflect the percentage of one dollar which must be expended to generate that dollar of revenue. We calculate this ratio by dividing noninterest expense, excluding amortization expense on intangibles and certain nonrecurring expense by the sum of net interest income (FTE) and noninterest income, excluding net gain (loss) on sale of securities available for sale and certain nonrecurring impairments. The most directly comparable financial measure calculated in accordance with GAAP is our efficiency ratio.

These non-GAAP financial measures should not be considered alternatives to GAAP-basis financial statements and other bank holding companies may define or calculate these non-GAAP measures or similar measures differently. Whenever we present a non-GAAP financial measure in an SEC filing, we are also required to present the most directly comparable financial measure calculated and presented in accordance with GAAP and reconcile the differences between the non-GAAP financial measure and such comparable GAAP measure.

Management believes adjusting net interest income, net interest margin and net interest spread to a fully taxable-equivalent basis is a standard practice in the banking industry as these measures provide useful information to make peer comparisons. Tax-equivalent adjustments are reflected in the respective earning asset categories as listed in the “Average Balances with Average Yields and Rates” tables.

A reconciliation of our non-GAAP financial measures to the comparable GAAP financial measures is included at the end of the financial statement tables.

About Southside Bancshares, Inc.

Southside Bancshares, Inc. is a bank holding company with approximately $6.75 billion in assets as of December 31, 2019, that owns 100% of Southside Bank. Southside Bank currently has 60 branches in Texas and operates a network of 82 ATMs/ITMs.

To learn more about Southside Bancshares, Inc., please visit our investor relations website at https://investors.southside.com. Our investor relations site provides a detailed overview of our activities, financial information and historical stock price data. To receive e-mail notification of company news, events and stock activity, please register on the E-mail Notification portion of the website. Questions or comments may be directed to Lindsey Bailes at (903) 630-7965, or lindsey.bailes@southside.com.

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Forward-Looking Statements

Certain statements of other than historical fact that are contained in this press release and in other written material, documents and oral statements issued by or on behalf of the Company may be considered to be “forward-looking statements” within the meaning of and subject to the safe harbor protections of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are not guarantees of future performance, nor should they be relied upon as representing management’s views as of any subsequent date. These statements may include words such as “expect,” “estimate,” “project,” “anticipate,” “appear,” “believe,” “could,” “should,” “may,” “likely,” “intend,” “probability,” “risk,” “target,” “objective,” “plans,” “potential,” and similar expressions. Forward-looking statements are statements with respect to the Company’s beliefs, plans, expectations, objectives, goals, anticipations, assumptions and estimates about the Company's future performance and are subject to significant known and unknown risks and uncertainties, which could cause the Company's actual results to differ materially from the results discussed in the forward-looking statements. For example, discussions about trends in asset quality, capital, liquidity, the pace of loan and revenue growth, the Company's ability to sell nonperforming assets, expense reductions, planned operational efficiencies, earnings, successful integration of completed acquisitions and certain market risk disclosures, including the impact of interest rates, tax reform and other economic factors, are based upon information presently available to management and are dependent on choices about key model characteristics and assumptions and are subject to various limitations. By their nature, certain of the market risk disclosures are only estimates and could be materially different from what actually occurs in the future.

Additional information concerning the Company and its business, including additional factors that could materially affect the Company’s financial results, is included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018, under “Part I - Item 1. Forward Looking Information” and "Part I - Item 1A. Risk Factors" and in the Company’s other filings with the Securities and Exchange Commission. The Company disclaims any obligation to update any factors or to announce publicly the result of revisions to any of the forward-looking statements included herein to reflect future events or developments.

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Southside Bancshares, Inc.

Consolidated Financial Summary (Unaudited)

(Dollars in thousands)



	As of
	2019												2018
	Dec 31,			Sep 30,			Jun 30,			Mar 31,			Dec 31,
ASSETS
Cash and due from banks	$	66,949		$	92,300		$	77,319		$	81,981		$	87,375
Interest earning deposits	43,748			22,524			54,642			184,612			23,884
Federal funds sold	—			—			560			3,350			9,460
Securities available for sale, at estimated fair value	2,358,597			2,240,381			2,088,787			1,876,255			1,989,436
Securities held to maturity, at carrying value	134,863			140,955			147,091			147,431			162,931
Total securities	2,493,460			2,381,336			2,235,878			2,023,686			2,152,367
Federal Home Loan Bank stock, at cost	50,087			45,039			44,718			35,269			32,583
Loans held for sale	383			1,000			1,812			384			601
Loans	3,568,204			3,499,917			3,460,143			3,305,110			3,312,799
Less: Allowance for loan losses	(24,797		)	(25,129		)	(24,705		)	(24,155		)	(27,019		)
Net loans	3,543,407			3,474,788			3,435,438			3,280,955			3,285,780
Premises & equipment, net	143,912			141,683			140,105			138,290			135,972
Goodwill	201,116			201,116			201,116			201,116			201,116
Other intangible assets, net	13,361			14,391			15,471			16,600			17,779
Bank owned life insurance	100,498			99,916			99,294			98,704			98,160
Other assets	91,992			67,982			66,517			152,249			78,417
Total assets	$	6,748,913		$	6,542,075		$	6,372,870		$	6,217,196		$	6,123,494

LIABILITIES AND SHAREHOLDERS' EQUITY
Noninterest bearing deposits	$	1,040,112		$	1,038,695		$	1,028,861		$	1,038,116		$	994,680
Interest bearing deposits	3,662,657			3,452,072			3,450,395			3,529,777			3,430,350
Total deposits	4,702,769			4,490,767			4,479,256			4,567,893			4,425,030
Other borrowings and Federal Home Loan Bank borrowings	1,001,102			988,577			849,821			628,498			755,875
Subordinated notes, net of unamortized debt issuance costs	98,576			98,532			98,490			98,448			98,407
Trust preferred subordinated debentures, net of unamortized debt issuance costs	60,250			60,249			60,248			60,247			60,246
Other liabilities	81,636			93,497			97,290			104,077			52,645
Total liabilities	5,944,333			5,731,622			5,585,105			5,459,163			5,392,203
Shareholders' equity	804,580			810,453			787,765			758,033			731,291
Total liabilities and shareholders' equity	$	6,748,913		$	6,542,075		$	6,372,870		$	6,217,196		$	6,123,494

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Southside Bancshares, Inc.

Consolidated Financial Highlights (Unaudited)

(Dollars and shares in thousands, except per share data)



	Three Months Ended
	2019												2018
	Dec 31,			Sep 30,			Jun 30,			Mar 31,			Dec 31,
Income Statement:
Total interest income	$	60,533		$	60,555		$	60,672		$	59,027		$	58,022
Total interest expense	17,357			18,182			17,541			17,902			15,612
Net interest income	43,176			42,373			43,131			41,125			42,410
Provision for loan losses	2,508			1,005			2,506			(918		)	2,446
Net interest income after provision for loan losses	40,668			41,368			40,625			42,043			39,964
Noninterest income
Deposit services	6,647			6,753			6,652			5,986			6,325
Net gain on sale of securities available for sale	42			42			416			256			61
Gain on sale of loans	104			131			181			93			101
Trust fees	1,685			1,523			1,520			1,541			1,573
Bank owned life insurance	582			622			559			544			554
Brokerage services	531			555			477			517			499
Other	874			1,485			1,449			601			1,021
Total noninterest income	10,465			11,111			11,254			9,538			10,134
Noninterest expense
Salaries and employee benefits	19,406			18,388			17,891			18,046			17,823
Net occupancy	3,234			3,430			3,289			3,175			3,475
Acquisition expense	—			—			—			—			118
Advertising, travel & entertainment	791			593			733			847			786
ATM expense	236			232			246			180			250
Professional fees	1,142			1,192			1,069			1,314			1,189
Software and data processing	1,259			1,116			1,086			1,076			1,057
Communications	485			480			489			487			477
FDIC insurance	—			—			437			422			455
Amortization of intangibles	1,030			1,080			1,129			1,179			1,228
Other	3,361			2,515			3,331			2,901			3,338
Total noninterest expense	30,944			29,026			29,700			29,627			30,196
Income before income tax expense	20,189			23,453			22,179			21,954			19,902
Income tax expense	2,854			3,661			3,569			3,137			2,521
Net income	$	17,335		$	19,792		$	18,610		$	18,817		$	17,381

Common Share Data:
Weighted-average basic shares outstanding	33,790			33,773			33,726			33,697			34,611
Weighted-average diluted shares outstanding	33,934			33,901			33,876			33,846			34,748
Common shares outstanding end of period	33,823			33,795			33,749			33,718			33,725
Earnings per common share
Basic	$	0.51		$	0.59		$	0.55		$	0.56		$	0.50
Diluted	0.51			0.58			0.55			0.56			0.50
Book value per common share	23.79			23.98			23.34			22.48			21.68
Tangible book value per common share ⁽¹⁾	17.45			17.60			16.92			16.02			15.19
Cash dividends paid per common share	0.34			0.31			0.31			0.30			0.32

Selected Performance Ratios:
Return on average assets	1.03		%	1.23		%	1.20		%	1.21		%	1.14		%
Return on average shareholders’ equity	8.42			9.78			9.68			10.35			9.30
Return on average tangible common equity ⁽¹⁾	11.97			13.96			14.12			15.44			13.95
Average yield on earning assets (FTE) ⁽¹⁾	4.12			4.28			4.42			4.33			4.32
Average rate on interest bearing liabilities	1.46			1.60			1.61			1.62			1.46
Net interest spread (FTE) ⁽¹⁾	2.66			2.68			2.81			2.71			2.86
Net interest margin (FTE) ⁽¹⁾	2.98			3.03			3.17			3.07			3.21
Average earning assets to average interest bearing liabilities	128.00			128.33			128.99			127.70			131.07
Noninterest expense to average total assets	1.85			1.80			1.91			1.91			1.98
Efficiency ratio (FTE) ⁽¹⁾	53.87			50.53			51.44			53.66			52.18


(1)	Refer to “Non-GAAP Reconciliation” at the end of the financial statement tables in this Earnings Release for a reconciliation of this non-GAAP financial measure to the nearest GAAP financial measure.

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Southside Bancshares, Inc.

Consolidated Financial Highlights (Unaudited)

(Dollars in thousands)



	Three Months Ended
	2019												2018
	Dec 31,			Sep 30,			Jun 30,			Mar 31,			Dec 31,
Nonperforming Assets:	$	17,449		$	29,747		$	29,363		$	38,111		$	42,906
Nonaccrual loans ⁽¹⁾	4,963			17,148			16,376			17,691			35,770
Accruing loans past due more than 90 days ⁽¹⁾	—			—			—			7,927			—
Restructured loans⁽²⁾	12,014			11,683			11,918			11,490			5,930
Other real estate owned	472			912			1,069			978			1,206
Repossessed assets	—			4			—			25			—

Asset Quality Ratios:
Nonaccruing loans to total loans	0.14		%	0.49		%	0.47		%	0.54		%	1.08		%
Allowance for loan losses to nonaccruing loans	499.64			146.54			150.86			136.54			75.54
Allowance for loan losses to nonperforming assets	142.11			84.48			84.14			63.38			62.97
Allowance for loan losses to total loans	0.69			0.72			0.71			0.73			0.82
Nonperforming assets to total assets	0.26			0.45			0.46			0.61			0.70
Net charge-offs (recoveries) to average loans	0.32			0.07			0.23			0.24			0.18

Capital Ratios:
Shareholders’ equity to total assets	11.92			12.39			12.36			12.19			11.94
Common equity tier 1 capital	14.07			14.19			14.02			14.38			14.77
Tier 1 risk-based capital	15.46			15.61			15.46			15.88			16.29
Total risk-based capital	18.43			18.65			18.52			19.06			19.59
Tier 1 leverage capital	10.18			10.46			10.48			10.18			10.64
Period end tangible equity to period end tangible assets⁽³⁾	9.03			9.40			9.28			9.01			8.68
Average shareholders’ equity to average total assets	12.28			12.54			12.36			11.70			12.23


(1)	Excludes purchased credit impaired ("PCI") loans measured at fair value at acquisition if the timing and amount of cash flows expected to be collected from those sales can be reasonably estimated.


(2)	Includes $0.8 million, $0.8 million, $0.8 million, $0.7 million and $3.1 million in PCI loans restructured as of December 31, 2019, September 30, 2019, June 30, 2019, March 31, 2019 and December 31, 2018, respectively.


(3)	Refer to the “Non-GAAP Reconciliation” at the end of the financial statement tables in this Earnings Release for a reconciliation of this non-GAAP financial measure to the nearest GAAP financial measure.

Loan Portfolio Composition

The following table sets forth loan totals by category for the periods presented (in thousands):



	Three Months Ended
	2019								2018
	Dec 31,		Sep 30,		Jun 30,		Mar 31,		Dec 31,
Real Estate Loans:
Construction	$	644,948	$	621,040	$	579,565	$	603,411	$	507,732
1-4 Family Residential	787,562		792,638		782,073		786,198		794,499
Commercial	1,250,208		1,236,307		1,251,248		1,104,378		1,194,118
Commercial Loans	401,521		382,077		389,521		367,995		356,649
Municipal Loans	383,960		366,906		357,028		343,026		353,370
Loans to Individuals	100,005		100,949		100,708		100,102		106,431
Total Loans	$	3,568,204	$	3,499,917	$	3,460,143	$	3,305,110	$	3,312,799

Page-8

Southside Bancshares, Inc.

Consolidated Financial Highlights (Unaudited)

(Dollars and shares in thousands, except per share data)



	Year Ended
	December 31,
	2019			2018
Income Statement:
Total interest income	$	240,787		$	229,165
Total interest expense	70,982			57,101
Net interest income	169,805			172,064
Provision for loan losses	5,101			8,437
Net interest income after provision for loan losses	164,704			163,627
Noninterest income
Deposit services	26,038			25,082
Net gain (loss) on sale of securities available for sale	756			(1,839		)
Gain on sale of loans	509			692
Trust fees	6,269			6,832
Bank owned life insurance	2,307			2,923
Brokerage services	2,080			1,987
Other	4,409			5,096
Total noninterest income	42,368			40,773
Noninterest expense
Salaries and employee benefits	73,731			70,643
Net occupancy	13,128			13,814
Acquisition expense	—			2,413
Advertising, travel & entertainment	2,964			2,894
ATM expense	894			1,090
Professional fees	4,717			4,035
Software and data processing	4,537			3,996
Communications	1,941			1,847
FDIC insurance	859			1,871
Amortization of intangibles	4,418			5,213
Other	12,108			12,283
Total noninterest expense	119,297			120,099
Income before income tax expense	87,775			84,301
Income tax expense	13,221			10,163
Net income	$	74,554		$	74,138

Common Share Data:
Weighted-average basic shares outstanding	33,747			34,951
Weighted-average diluted shares outstanding	33,895			35,116
Common shares outstanding end of period	33,823			33,725
Earnings per common share
Basic	$	2.21		$	2.12
Diluted	2.20			2.11
Book value per common share	23.79			21.68
Tangible book value per common share ⁽¹⁾	17.45			15.19
Cash dividends paid per common share	1.26			1.20

Selected Performance Ratios:
Return on average assets	1.17		%	1.19		%
Return on average shareholders’ equity	9.53			9.87
Return on average tangible common equity ⁽¹⁾	13.80			14.79
Average yield on earning assets (FTE) ⁽¹⁾	4.28			4.18
Average rate on interest bearing liabilities	1.57			1.30
Net interest spread (FTE) ⁽¹⁾	2.71			2.88
Net interest margin (FTE) ⁽¹⁾	3.06			3.18
Average earning assets to average interest bearing liabilities	128.25			129.89
Noninterest expense to average total assets	1.86			1.93
Efficiency ratio (FTE) ⁽¹⁾	52.36			49.98


(1)	Refer to “Non-GAAP Reconciliation” at the end of the financial statement tables in this Earnings Release for a reconciliation of this non-GAAP financial measure to the nearest GAAP financial measure.

Page-9

Southside Bancshares, Inc.

Consolidated Financial Highlights (Unaudited)

(Dollars in thousands)



	Year Ended
	December 31,
	2019			2018
Nonperforming Assets:	$	17,449		$	42,906
Nonaccrual loans ⁽¹⁾	4,963			35,770
Accruing loans past due more than 90 days ⁽¹⁾	—			—
Restructured loans⁽²⁾	12,014			5,930
Other real estate owned	472			1,206
Repossessed assets	—			—

Asset Quality Ratios:
Nonaccruing loans to total loans	0.14		%	1.08		%
Allowance for loan losses to nonaccruing loans	499.64			75.54
Allowance for loan losses to nonperforming assets	142.11			62.97
Allowance for loan losses to total loans	0.69			0.82
Nonperforming assets to total assets	0.26			0.70
Net charge-offs (recoveries) to average loans	0.21			0.07

Capital Ratios:
Shareholders’ equity to total assets	11.92			11.94
Common equity tier 1 capital	14.07			14.77
Tier 1 risk-based capital	15.46			16.29
Total risk-based capital	18.43			19.59
Tier 1 leverage capital	10.18			10.64
Period end tangible equity to period end tangible assets⁽³⁾	9.03			8.68
Average shareholders’ equity to average total assets	12.23			12.06


(1)	Excludes PCI loans measured at fair value at acquisition if the timing and amount of cash flows expected to be collected from those sales can be reasonably estimated.


(2)	Includes $0.8 million and $3.1 million in PCI loans restructured as of December 31, 2019 and December 31, 2018, respectively.


(3)	Refer to the “Non-GAAP Reconciliation” at the end of the financial statement tables in this Earnings Release for a reconciliation of this non-GAAP financial measure to the nearest GAAP financial measure.

Page-10

Southside Bancshares, Inc.

Average Balances and Average Yields and Rates (Annualized) (Unaudited)

(Dollars in thousands)

The tables that follow show average earning assets and interest bearing liabilities together with the average yield on the earning assets and the average rate of the interest bearing liabilities for the periods presented. The interest and related yields presented are on a fully taxable-equivalent basis and are therefore non-GAAP measures. See “Non-GAAP Financial Measures” and “Non-GAAP Reconciliation” for more information.



	Three Months Ended
	December 31, 2019							September 30, 2019
	Average Balance			Interest		Average Yield/Rate		Average Balance			Interest		Average Yield/Rate
ASSETS
Loans ⁽¹⁾	$	3,540,274		$	43,166	4.84	%	$	3,477,187		$	43,780	5.00	%
Loans held for sale	1,114			9		3.21	%	2,497			26		4.13	%
Securities:
Taxable investment securities ⁽²⁾	10,083			86		3.38	%	3,000			26		3.44	%
Tax-exempt investment securities ⁽²⁾	699,868			6,431		3.65	%	555,835			5,328		3.80	%
Mortgage-backed and related securities ⁽²⁾	1,674,503			12,197		2.89	%	1,660,331			12,569		3.00	%
Total securities	2,384,454			18,714		3.11	%	2,219,166			17,923		3.20	%
Federal Home Loan Bank stock, at cost, and equity investments	59,743			437		2.90	%	57,108			422		2.93	%
Interest earning deposits	44,039			247		2.23	%	26,746			206		3.06	%
Federal funds sold	—			—		—		—			—		—
Total earning assets	6,029,624			62,573		4.12	%	5,782,704			62,357		4.28	%
Cash and due from banks	72,018							73,815
Accrued interest and other assets	574,124							570,657
Less: Allowance for loan losses	(25,618		)					(24,938		)
Total assets	$	6,650,148						$	6,402,238
LIABILITIES AND SHAREHOLDERS’ EQUITY
Savings accounts	$	372,798		262		0.28	%	$	367,615		270		0.29	%
Certificates of deposits	1,204,392			6,172		2.03	%	1,118,410			6,011		2.13	%
Interest bearing demand accounts	1,936,969			4,067		0.83	%	1,966,764			5,085		1.03	%
Total interest bearing deposits	3,514,159			10,501		1.19	%	3,452,789			11,366		1.31	%
Federal Home Loan Bank borrowings	1,019,844			4,716		1.83	%	881,088			4,647		2.09	%
Subordinated notes, net of unamortized debt issuance costs	98,554			1,426		5.74	%	98,511			1,425		5.74	%
Trust preferred subordinated debentures, net of unamortized debt issuance costs	60,250			643		4.23	%	60,248			685		4.51	%
Other borrowings	17,874			71		1.58	%	13,401			59		1.75	%
Total interest bearing liabilities	4,710,681			17,357		1.46	%	4,506,037			18,182		1.60	%
Noninterest bearing deposits	1,049,211							1,020,325
Accrued expenses and other liabilities	73,408							72,923
Total liabilities	5,833,300							5,599,285
Shareholders’ equity	816,848							802,953
Total liabilities and shareholders’ equity	$	6,650,148						$	6,402,238
Net interest income (FTE)				$	45,216						$	44,175
Net interest margin (FTE)						2.98	%						3.03	%
Net interest spread (FTE)						2.66	%						2.68	%


(1)	Interest on loans includes net fees on loans that are not material in amount.


(2)	For the purpose of calculating the average yield, the average balance of securities is presented at historical cost.

Note: As of December 31, 2019 and September 30, 2019, loans totaling $5.0 million and $17.1 million, respectively, were on nonaccrual status. Our policy is to reverse previously accrued but unpaid interest on nonaccrual loans; thereafter, interest income is recorded to the extent received when appropriate.

Page-11

Southside Bancshares, Inc.

Average Balances and Average Yields and Rates (Annualized) (Unaudited)

(Dollars in thousands)



	Three Months Ended
	June 30, 2019							March 31, 2019
	Average Balance			Interest		Average Yield/Rate		Average Balance			Interest		Average Yield/Rate
ASSETS
Loans ⁽¹⁾	$	3,387,323		$	43,559	5.16	%	$	3,296,665		$	42,210	5.19	%
Loans held for sale	1,965			21		4.29	%	611			7		4.65	%
Securities:
Taxable investment securities ⁽²⁾	3,000			27		3.61	%	3,000			28		3.79	%
Tax-exempt investment securities ⁽²⁾	459,996			4,513		3.94	%	659,187			5,732		3.53	%
Mortgage-backed and related securities ⁽²⁾	1,680,109			13,246		3.16	%	1,647,564			12,474		3.07	%
Total securities	2,143,105			17,786		3.33	%	2,309,751			18,234		3.20	%
Federal Home Loan Bank stock, at cost, and equity investments	52,311			440		3.37	%	53,764			355		2.68	%
Interest earning deposits	66,017			411		2.50	%	64,690			386		2.42	%
Federal funds sold	3,365			39		4.65	%	7,635			47		2.50	%
Total earning assets	5,654,086			62,256		4.42	%	5,733,116			61,239		4.33	%
Cash and due from banks	78,757							83,147
Accrued interest and other assets	534,835							513,738
Less: Allowance for loan losses	(24,838		)					(27,060		)
Total assets	$	6,242,840						$	6,302,941
LIABILITIES AND SHAREHOLDERS’ EQUITY
Savings accounts	$	365,205		262		0.29	%	$	360,664		258		0.29	%
Certificates of deposit	1,119,464			5,861		2.10	%	1,154,203			5,697		2.00	%
Interest bearing demand accounts	1,969,593			5,334		1.09	%	1,982,891			5,286		1.08	%
Total interest bearing deposits	3,454,262			11,457		1.33	%	3,497,758			11,241		1.30	%
Federal Home Loan Bank borrowings	755,748			3,899		2.07	%	816,389			4,457		2.21	%
Subordinated notes, net of unamortized debt issuance costs	98,469			1,410		5.74	%	98,428			1,400		5.77	%
Trust preferred subordinated debentures, net of unamortized debt issuance costs	60,247			718		4.78	%	60,246			729		4.91	%
Other borrowings	14,530			57		1.57	%	16,788			75		1.81	%
Total interest bearing liabilities	4,383,256			17,541		1.61	%	4,489,609			17,902		1.62	%
Noninterest bearing deposits	1,014,746							986,343
Accrued expenses and other liabilities	73,494							89,768
Total liabilities	5,471,496							5,565,720
Shareholders’ equity	771,344							737,221
Total liabilities and shareholders’ equity	$	6,242,840						$	6,302,941
Net interest income (FTE)				$	44,715						$	43,337
Net interest margin (FTE)						3.17	%						3.07	%
Net interest spread (FTE)						2.81	%						2.71	%


(1)	Interest on loans includes net fees on loans that are not material in amount.


(2)	For the purpose of calculating the average yield, the average balance of securities is presented at historical cost.

Note: As of June 30, 2019 and March 31, 2019, loans totaling $16.4 million and $17.7 million, respectively, were on nonaccrual status. Our policy is to reverse previously accrued but unpaid interest on nonaccrual loans; thereafter, interest income is recorded to the extent received when appropriate.

Page-12

Southside Bancshares, Inc.

Average Balances and Average Yields and Rates (Annualized) (Unaudited)

(Dollars in thousands)



	Three Months Ended
	December 31, 2018
	Average Balance			Interest		Average Yield/Rate
ASSETS
Loans ⁽¹⁾	$	3,289,840		$	41,320	4.98	%
Loans held for sale	633			8		5.01	%
Securities:
Taxable investment securities⁽²⁾	13,066			103		3.13	%
Tax-exempt investment securities⁽²⁾	722,162			7,828		4.30	%
Mortgage-backed and related securities ⁽²⁾	1,434,982			10,394		2.87	%
Total securities	2,170,210			18,325		3.35	%
Federal Home Loan Bank stock, at cost, and equity investments	44,304			393		3.52	%
Interest earning deposits	36,098			411		4.52	%
Federal funds sold	16,967			97		2.27	%
Total earning assets	5,558,052			60,554		4.32	%
Cash and due from banks	79,544
Accrued interest and other assets	452,257
Less: Allowance for loan losses	(26,231		)
Total assets	$	6,063,622
LIABILITIES AND SHAREHOLDERS’ EQUITY
Savings accounts	$	361,407		257		0.28	%
Certificates of deposit	1,123,101			5,170		1.83	%
Interest bearing demand accounts	1,968,786			4,908		0.99	%
Total interest bearing deposits	3,453,294			10,335		1.19	%
Federal Home Loan Bank borrowings	612,134			3,066		1.99	%
Subordinated notes, net of unamortized debt issuance costs	98,385			1,431		5.77	%
Trust preferred subordinated debentures, net of unamortized debt issuance costs	60,245			699		4.60	%
Other borrowings	16,405			81		1.96	%
Total interest bearing liabilities	4,240,463			15,612		1.46	%
Noninterest bearing deposits	1,034,556
Accrued expenses and other liabilities	47,234
Total liabilities	5,322,253
Shareholders’ equity	741,369
Total liabilities and shareholders’ equity	$	6,063,622
Net interest income (FTE)				$	44,942
Net interest margin (FTE)						3.21	%
Net interest spread (FTE)						2.86	%


(1)	Interest on loans includes net fees on loans that are not material in amount.


(2)	For the purpose of calculating the average yield, the average balance of securities is presented at historical cost.

Note: As of December 31, 2018, loans totaling $35.8 million were on nonaccrual status. Our policy is to reverse previously accrued but unpaid interest on nonaccrual loans; thereafter, interest income is recorded to the extent received when appropriate.

Page-13

Southside Bancshares, Inc.

Average Balances and Average Yields and Rates (Unaudited)

(Dollars in thousands)



	Year Ended
	December 31, 2019							December 31, 2018
	Average Balance			Interest		Average Yield/Rate		Average Balance			Interest		Average Yield/Rate
ASSETS
Loans ⁽¹⁾	$	3,426,171		$	172,715	5.04	%	$	3,290,651		$	160,982	4.89	%
Loans held for sale	1,551			63		4.06	%	1,451			63		4.34	%
Securities:
Taxable investment securities⁽²⁾	4,785			167		3.49	%	15,790			417		2.64	%
Tax-exempt investment securities⁽²⁾	593,729			22,004		3.71	%	781,127			31,964		4.09	%
Mortgage-backed and related securities ⁽²⁾	1,665,686			50,486		3.03	%	1,462,055			41,584		2.84	%
Total securities	2,264,200			72,657		3.21	%	2,258,972			73,965		3.27	%
Federal Home Loan Bank stock, at cost, and equity investments	55,752			1,654		2.97	%	54,998			1,595		2.90	%
Interest earning deposits	50,252			1,250		2.49	%	78,266			1,624		2.07	%
Federal funds sold	2,722			86		3.16	%	15,647			294		1.88	%
Total earning assets	5,800,648			248,425		4.28	%	5,699,985			238,523		4.18	%
Cash and due from banks	76,895							77,946
Accrued interest and other assets	547,241							473,639
Less: Allowance for loan losses	(25,608		)					(24,378		)
Total assets	$	6,399,176						$	6,227,192
LIABILITIES AND SHAREHOLDERS’ EQUITY
Savings accounts	$	366,606		1,052		0.29	%	$	359,509		907		0.25	%
Certificates of deposit	1,149,171			23,741		2.07	%	1,160,423			18,112		1.56	%
Interest bearing demand accounts	1,963,936			19,772		1.01	%	1,978,140			16,845		0.85	%
Total interest bearing deposits	3,479,713			44,565		1.28	%	3,498,072			35,864		1.03	%
Federal Home Loan Bank borrowings	868,859			17,719		2.04	%	720,785			12,813		1.78	%
Subordinated notes, net of unamortized debt issuance costs	98,491			5,661		5.75	%	98,327			5,659		5.76	%
Trust preferred subordinated debentures, net of unamortized debt issuance costs	60,248			2,775		4.61	%	60,243			2,610		4.33	%
Other borrowings	15,645			262		1.67	%	10,880			155		1.42	%
Total interest bearing liabilities	4,522,956			70,982		1.57	%	4,388,307			57,101		1.30	%
Noninterest bearing deposits	1,017,836							1,040,447
Accrued expenses and other liabilities	76,017							47,176
Total liabilities	5,616,809							5,475,930
Shareholders’ equity	782,367							751,262
Total liabilities and shareholders’ equity	$	6,399,176						$	6,227,192
Net interest income (FTE)				$	177,443						$	181,422
Net interest margin (FTE)						3.06	%						3.18	%
Net interest spread (FTE)						2.71	%						2.88	%


(1)	Interest on loans includes net fees on loans that are not material in amount.


(2)	For the purpose of calculating the average yield, the average balance of securities is presented at historical cost.

Note: As of December 31, 2019 and 2018, loans totaling $5.0 million and $35.8 million, respectively, were on nonaccrual status. Our policy is to reverse previously accrued but unpaid interest on nonaccrual loans; thereafter, interest income is recorded to the extent received when appropriate.

Page-14

Southside Bancshares, Inc.

Non-GAAP Reconciliation (Unaudited)

(Dollars and shares in thousands, except per share data)

The following tables set forth the reconciliation of return on average common equity to return on average tangible common equity, book value per share to tangible book value per share, net interest income to net interest income adjusted to a fully taxable-equivalent basis assuming a 21% marginal tax rate for interest earned on tax-exempt assets such as municipal loans and investment securities, along with the calculation of total revenue, adjusted noninterest expense, efficiency ratio (FTE), net interest margin (FTE) and net interest spread (FTE) for the applicable periods presented.



	Three Months Ended															Year Ended
	2019												2018			December 31,
	Dec 31,			Sep 30,			Jun 30,			Mar 31,			Dec 31,			2019			2018
Reconciliation of return on average common equity to return on average tangible common equity:
Net income	$	17,335		$	19,792		$	18,610		$	18,817		$	17,381		$	74,554		$	74,138
After-tax amortization expense	814			853			892			931			970			3,490			4,118
Adjusted net income available to common shareholders	$	18,149		$	20,645		$	19,502		$	19,748		$	18,351		$	78,044		$	78,256

Average shareholders' equity	$	816,848		$	802,953		$	771,344		$	737,221		$	741,369		$	782,367		$	751,262
Less: Average intangibles for the period	(215,101		)	(216,169		)	(217,266		)	(218,438		)	(219,645		)	(216,733		)	(222,325		)
Average tangible shareholders' equity	$	601,747		$	586,784		$	554,078		$	518,783		$	521,724		$	565,634		$	528,937

Return on average tangible common equity	11.97		%	13.96		%	14.12		%	15.44		%	13.95		%	13.80		%	14.79		%

Reconciliation of book value per share to tangible book value per share:
Common equity at end of period	$	804,580		$	810,453		$	787,765		$	758,033		$	731,291		$	804,580		$	731,291
Less: Intangible assets at end of period	(214,477		)	(215,507		)	(216,587		)	(217,716		)	(218,895		)	(214,477		)	(218,895		)
Tangible common shareholders' equity at end of period	$	590,103		$	594,946		$	571,178		$	540,317		$	512,396		$	590,103		$	512,396

Total assets at end of period	$	6,748,913		$	6,542,075		$	6,372,870		$	6,217,196		$	6,123,494		$	6,748,913		$	6,123,494
Less: Intangible assets at end of period	(214,477		)	(215,507		)	(216,587		)	(217,716		)	(218,895		)	(214,477		)	(218,895		)
Tangible assets at end of period	$	6,534,436		$	6,326,568		$	6,156,283		$	5,999,480		$	5,904,599		$	6,534,436		$	5,904,599

Period end tangible equity to period end tangible assets	9.03		%	9.40		%	9.28		%	9.01		%	8.68		%	9.03		%	8.68		%

Common shares outstanding end of period	33,823			33,795			33,749			33,718			33,725			33,823			33,725
Tangible book value per common share	$	17.45		$	17.60		$	16.92		$	16.02		$	15.19		$	17.45		$	15.19

Reconciliation of efficiency ratio to efficiency ratio (FTE), net interest margin to net interest margin (FTE) and net interest spread to net interest spread (FTE):
Net interest income (GAAP)	$	43,176		$	42,373		$	43,131		$	41,125		$	42,410		$	169,805		$	172,064
Tax equivalent adjustments:
Loans	653			641			598			598			599			2,490			2,354
Tax-exempt investment securities	1,387			1,161			986			1,614			1,933			5,148			7,004
Net interest income (FTE) ⁽¹⁾	45,216			44,175			44,715			43,337			44,942			177,443			181,422
Noninterest income	10,465			11,111			11,254			9,538			10,134			42,368			40,773
Nonrecurring income ⁽²⁾	(42		)	(42		)	(557		)	171			(66		)	(470		)	1,198
Total revenue	$	55,639		$	55,244		$	55,412		$	53,046		$	55,010		$	219,341		$	223,393

Noninterest expense	$	30,944		$	29,026		$	29,700		$	29,627		$	30,196		$	119,297		$	120,099
Pre-tax amortization expense	(1,030		)	(1,080		)	(1,129		)	(1,179		)	(1,228		)	(4,418		)	(5,213		)
Nonrecurring expense ⁽³⁾	56			(33		)	(67		)	18			(264		)	(26		)	(3,236		)
Adjusted noninterest expense	$	29,970		$	27,913		$	28,504		$	28,466		$	28,704		$	114,853		$	111,650

Efficiency ratio	55.92		%	52.23		%	52.95		%	56.00		%	54.70		%	54.25		%	52.16		%
Efficiency ratio (FTE) ⁽¹⁾	53.87		%	50.53		%	51.44		%	53.66		%	52.18		%	52.36		%	49.98		%

Average earning assets	$	6,029,624		$	5,782,704		$	5,654,086		$	5,733,116		$	5,558,052		$	5,800,648		$	5,699,985

Net interest margin	2.84		%	2.91		%	3.06		%	2.91		%	3.03		%	2.93		%	3.02		%
Net interest margin (FTE) ⁽¹⁾	2.98		%	3.03		%	3.17		%	3.07		%	3.21		%	3.06		%	3.18		%

Net interest spread	2.52		%	2.55		%	2.69		%	2.56		%	2.68		%	2.58		%	2.72		%
Net interest spread (FTE) ⁽¹⁾	2.66		%	2.68		%	2.81		%	2.71		%	2.86		%	2.71		%	2.88		%


(1)	These amounts are presented on a fully taxable-equivalent basis and are non-GAAP measures.


(2)	These adjustments may include net gain and loss on sale of securities available for sale, loss on fair value hedge, other-than-temporary impairment charges and additional bank owned life insurance income realized as a result of the death benefits for a retired covered officer, in the periods where applicable.


(3)	These adjustments may include acquisition expenses, foreclosure expenses and branch closure expenses, in the periods where applicable.

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