0000707179-20-000177.txt : 20201019 0000707179-20-000177.hdr.sgml : 20201019 20201019080117 ACCESSION NUMBER: 0000707179-20-000177 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 16 CONFORMED PERIOD OF REPORT: 20201019 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20201019 DATE AS OF CHANGE: 20201019 FILER: COMPANY DATA: COMPANY CONFORMED NAME: OLD NATIONAL BANCORP /IN/ CENTRAL INDEX KEY: 0000707179 STANDARD INDUSTRIAL CLASSIFICATION: NATIONAL COMMERCIAL BANKS [6021] IRS NUMBER: 351539838 STATE OF INCORPORATION: IN FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-15817 FILM NUMBER: 201245265 BUSINESS ADDRESS: STREET 1: ONE MAIN ST CITY: EVANSVILLE STATE: IN ZIP: 47708 BUSINESS PHONE: 8124641434 MAIL ADDRESS: STREET 1: ONE MAIN ST CITY: EVANSVILLE STATE: IN ZIP: 47708 FORMER COMPANY: FORMER CONFORMED NAME: O DATE OF NAME CHANGE: 19950822 8-K 1 onb-20201019.htm 8-K onb-20201019
Old National Bancorp /IN/0000707179FALSE00007071792020-10-192020-10-19



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
_________________________________________________________

FORM 8-K
_________________________________________________________

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of report (Date of earliest event reported): 10/19/2020
_________________________________________________________

OLD NATIONAL BANCORP
(Exact name of Registrant as specified in its charter)
_________________________________________________________
INDIANA
001-1581735-1539838
(State or other jurisdiction of incorporation)
(Commission File Number)
(IRS Employer Identification No.)

One Main Street
Evansville, Indiana47708
(Address of Principal Executive Offices)
 (Zip Code)
Registrant’s telephone number, including area code: (800) 731-2265
________________________________________________________
(Former name or former address if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

    Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Trading
Symbol(s)
Name of each exchange on which registered
Common Stock, No Par ValueONBThe NASDAQ Stock Market LLC
Indicate by check mark whether the Registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (s230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (s240.12b-2 of this chapter).
Emerging growth company    

If an emerging growth company, indicate by check mark if the Registrant has elected not to use extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.    




Item 2.02 Results of Operations and Financial Condition.

On October 19, 2020, Old National Bancorp (the “Company”) issued a press release (“Press Release”) reporting its financial results for the third quarter of 2020. The Press Release is furnished as Exhibit 99.1 hereto and is incorporated herein by reference. A slide presentation outlining third quarter 2020 earnings, strategic developments, and the Company’s financial outlook will be available on the “Investor Relations” section of the Company’s website to complement the conference call to be held on October 19, 2020, at 9:00 a.m. CDT and will be accessible at http://www.oldnational.com immediately before the conference call begins.

Forward-Looking Statements

In this report, we have made various statements regarding current expectations or forecasts of future events, which speak only as of the date the statements are made. These statements are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are also made from time-to-time in press releases and in oral statements made by the officers of the Company. Forward-looking statements can be identified by the use of the words “expect,” “may,” “could,” “intend,” “project,” “estimate,” “believe,” “anticipate,” and other words of similar meaning. Such forward-looking statements are based on assumptions and estimates, which although believed to be reasonable, may turn out to be incorrect, such as statements about the potential impacts of the COVID-19 pandemic. Therefore, undue reliance should not be placed upon these estimates and statements. We cannot assure that any of these statements, estimates, or beliefs will be realized and actual results may differ from those contemplated in these “forward-looking statements.” We undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events, or otherwise. You are advised to consult further disclosures we may make on related subjects in our filings with the SEC.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit No.    Description

99.1         Press Release issued by Old National Bancorp on October 19, 2020

104         Cover Page Interactive Data File (embedded within the Inline XBRL document).
2




SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: October 19, 2020

OLD NATIONAL BANCORP

By: /s/ Brendon B. Falconer
Brendon B. Falconer
Senior Executive Vice President and
Chief Financial Officer


3

EX-99.1 2 onbexhibit991er3q20.htm EX-99.1 Document

Exhibit 99.1
Old National Bancorp
capture11.jpg
One Main Street
Evansville, IN 47708Media: Kathy A. Schoettlin (812) 465-7269
oldnational.comInvestors: Lynell J. Walton (812) 464-1366

Old National reports 3rd quarter earnings of $77.9 million,
or $0.47 per share

Evansville, Ind. (October 19, 2020)
Old National Bancorp (NASDAQ: ONB) reports 3Q20 net income of $77.9 million, diluted EPS of $0.47.
Adjusted1 net income of $76.4 million, or $0.46 per diluted share.
CEO COMMENTARY:
 “Our excellent 3rd quarter results are not only a testament to our ONB Way strategy and the overall strength of our organization, they are an indicator of the strength and resiliency of the clients and communities we serve,” said Chairman and CEO Jim Ryan. “More specifically, our quarterly success was driven by very strong commercial production throughout the franchise and outstanding credit metrics that actually resulted in net recoveries.”
THIRD QUARTER HIGHLIGHTS2:
Net income
Net income of $77.9 million
Earnings per diluted share of $0.47
Net interest income/NIM
Net interest income on a fully taxable equivalent basis of $149.0 million compared to $149.0 million
Net interest margin on a fully taxable equivalent basis of 3.03% compared to 3.14%
Operating Performance
Pre-provision net revenue1 (“PPNR”) of $93.5 million
Adjusted PPNR1 of $94.6 million, up 3.4% over third quarter of 2019
Noninterest expense of $120.2 million
Adjusted noninterest expense1 of $114.2 million
Efficiency ratio1 of 55.93%
Adjusted efficiency ratio1 of 53.06%, a 73 basis point improvement

Loans and Credit Quality
End-of-period total loans3 of $13,977.6 million compared to $13,738.2 million
Commercial real estate loans grew $298.2 million
Third-quarter total commercial production, excluding PPP loans, of $977.8 million
Provision for credit losses of $0.0 million
September 30 pipeline of $2.9 billion
Net recoveries of $3.0 million compared to net charge-offs of $0.5 million
Non-performing loans of 1.15% of total loans compared to 1.04%
Return Profile & Capital
Return on average common equity of 10.79%
Return on average tangible common equity1 of 17.88%
Adjusted return on average tangible common equity1 of 17.54%
No shares of common stock were repurchased during the current quarter
Notable Items
$2.9 million in ONB Way charges
$3.1 million in tax credit amortization

1 Non-GAAP financial measure that Management believes is useful in evaluating the financial results of the Company – please refer to the Non GAAP reconciliations contained in this release 2 Comparisons are on a linked-quarter basis, unless otherwise noted 3 Includes loans held for sale







RESULTS OF OPERATIONS

Old National Bancorp reported third quarter 2020 net income of $77.9 million, or $0.47 per diluted share.

Included in the third quarter were pre-tax charges of $2.9 million for the ONB Way. Excluding these charges from the current quarter and netting out debt securities gains, adjusted net income was $76.4 million, or $0.46 per diluted share.

LOANS
Strong commercial production drove total loan balances higher.

Period-end total loans were $13,977.6 million at September 30, 2020, an increase of $239.4 million when compared to the $13,738.2 million at June 30, 2020.
Commercial real estate loans increased $298.2 million to $5,701.5 million, or 22.1% annualized growth.
Commercial and industrial loans decreased $42.9 million to $4,264.6 million.
Consumer loans decreased $14.4 million to $1,661.1 million and residential mortgage loans increased $36.0 million to $2,265.3 million.
Total commercial loan production in the third quarter, excluding $20 million in PPP loan production, was $977.8 million; period-end pipeline totaled $2.9 billion.
Average total loans in the third quarter were $13,849.0 million, an increase of $398.9 million from the second quarter of 2020.

DEPOSITS
A low-cost core deposit franchise continues to be one of Old National’s strengths.

Period-end total deposits were $16,506.5 million at September 30, 2020, an increase of $187.1 million when compared to the $16,319.4 million at June 30, 2020.
Noninterest-bearing deposits increased to $5,463.0 million at September 30, 2020 from $5,217.7 million at June 30, 2020.
On average, total deposits in the third quarter were $16,436.8 million, compared to $15,652.8 million in the second quarter of 2020.

NET INTEREST INCOME AND MARGIN
Net interest income unchanged while net interest margin is lower as decline in asset yields outpaces decline in deposit and funding costs.

Net interest income remained unchanged at $145.6 million in the third quarter of 2020 when compared to the second quarter of 2020.
The net interest margin on a fully taxable equivalent basis decreased 11 basis points to 3.03% compared to 3.14% in the second quarter of 2020.
PPP interest and net fees combined to have a positive impact of $8.8 million to net interest income in the third quarter while having a net neutral impact to the interest margin.
Accretion income was $5.4 million, or 11 basis points of net interest margin, in the third quarter of 2020 compared to $5.8 million, or 12 basis points of net interest margin, in the second quarter of 2020. In the third quarter of 2020, accretion income was 2.6% of adjusted total revenue.
Interest collected on nonaccrual loans was $1.0 million, or 2 basis points of net interest margin, in the third quarter of 2020 compared to $0.6 million, or 1 basis point of net interest margin, in the second quarter of 2020.
The cost of total deposits declined 4 basis points to 0.13% in the third quarter of 2020 while the cost of total interest-bearing deposits decreased 6 basis points to 0.19%.

CREDIT QUALITY
Strong credit quality remains a hallmark of the Old National franchise.
Old National recorded no provision for credit losses in the third quarter of 2020, compared to $22.5 million in the second quarter.



Net recoveries in the third quarter were $3.0 million, compared to net charge-offs of $0.5 million in the second quarter.

30-89 day delinquencies were 0.20% at the end of the third quarter.
Non-performing loans increased as a percentage of total loans to 1.15%.
Loans acquired from previous acquisitions were recorded at fair value at the acquisition date. As of September 30, 2020, the remaining discount on these acquired loans was $56.0 million.
The allowance for credit losses was $131.4 million, or 0.95% of total loans at September 30, 2020.

NONINTEREST INCOME
Noninterest income increased due to a rebound in deposit service charges and continued strength in mortgage banking revenue.

Total noninterest income for the third quarter of 2020 was $64.7 million, an increase of $6.3 million from the second quarter of 2020.
Service charges on deposit accounts increased $1.1 million and mortgage banking revenue increased $0.8 million when compared to the second quarter of 2020.
Gains on sales of debt securities increased $4.4 million when compared to the second quarter of 2020.

NONINTEREST EXPENSE
Third quarter results demonstrate benefit of The ONB Way, helping drive positive operating leverage1.

Noninterest expense for the third quarter of 2020 was $120.2 million and included $2.9 million in ONB Way charges and $3.1 million in tax credit amortization.
Excluding these items, adjusted noninterest expense for the third quarter was $114.2 million, compared to the $115.0 million in adjusted noninterest expense in the second quarter of 2020.
The third quarter efficiency ratio was 55.93%, while the adjusted efficiency ratio was 53.06%.
Adjusted operating leverage1 was +298 basis points for the third quarter of 2020 as compared to the third quarter of 2019.

INCOME TAXES

On a fully taxable-equivalent basis, income tax expense in the third quarter was $15.6 million, resulting in a 16.6% FTE tax rate.
Income tax expense included $3.7 million in tax credit benefit.

CAPITAL AND LIQUIDITY
Capital ratios remain strong.

At the end of the third quarter, total risk-based capital was 13.10% and regulatory tier 1 capital was 12.10%.
Tangible common equity to tangible assets was 8.58% at the end of the third quarter compared to 8.45% in the second quarter of 2020.
The Company did not repurchase any shares of common stock during the third quarter.
A low loan to deposit ratio of 84.7%, combined with existing funding sources plus available unencumbered, high-quality collateral, provides strong liquidity.


NON-GAAP RECONCILIATIONS



($ in millions, except EPS, shares in 000s)
3Q20
Adjustments4
Adjusted 3Q20
Total Revenues (FTE)$213.7 $(4.9)$208.8 
Less: Provision for Credit Losses— — — 
Less: Noninterest Expenses(120.2)2.9 (117.3)
Income before Income Taxes (FTE)$93.5 $(2.0)$91.5 
Income Taxes(15.6)0.5 (15.1)
Net Income$77.9 $(1.5)$76.4 
Average Shares Outstanding165,419 — 165,419 
Earnings Per Share - Diluted$0.47 $(0.01)$0.46 
4 Tax-effect calculations use the current statutory FTE tax rates (federal + state)

($ in millions)
3Q20
2Q20
Net Interest Income$145.6 $145.6 
Add: FTE Adjustment3.4 3.4 
Net Interest Income (FTE)$149.0 $149.0 
Average Earning Assets$19,654.3 $19,007.7 
Net Interest Margin (FTE)3.03 %3.14 %
($ in millions)
3Q20
3Q19
Net Interest Income$145.6 $153.1 
Add: FTE Adjustment3.4 3.2 
Net Interest Income (FTE)$149.0 $156.3 
Add: Total Noninterest Income64.7 53.9 
Less: Noninterest Expense120.2 122.6 
Pre-Provision Net Revenue$93.5 $87.6 
Less: Debt Securities Gains(4.9)(0.4)
Add: ONB Way Charges2.9 1.8 
Add: Merger and Integration Charges— 1.3 
Add: Amortization of Tax Credit Investments3.1 1.2 
Adjusted Pre-Provision Net Revenue$94.6 $91.5 




($ in millions)
3Q20
2Q20
3Q19
Noninterest Expense$120.2 $120.2 $122.6 
Less: ONB Way Charges(2.9)(4.9)(1.8)
Less: Merger and Integration Charges— — (1.3)
Noninterest Expense less Charges$117.3 $115.3 $119.5 
Less: Amortization of Tax Credit Investments(3.1)(0.3)(1.2)
Adjusted Noninterest Expense$114.2 $115.0 $118.3 
Less: Intangible Amortization(3.4)(3.6)(4.2)
Adjusted Noninterest Expense Less Intangible Amortization$110.8 $111.4 $114.1 
Net Interest Income$145.6 $145.6 $153.1 
FTE Adjustment3.4 3.4 3.2 
Net Interest Income (FTE)$149.0 $149.0 $156.3 
Total Noninterest Income64.7 58.5 53.9 
Total Revenue (FTE)$213.7 $207.5 $210.2 
Less: Debt Securities Gains/Losses(4.9)(0.5)(0.4)
Add: Loss on Branch Actions— 0.1 — 
Adjusted Total Revenue (FTE)$208.8 $207.1 $209.8 
Efficiency Ratio55.93 %56.29 %56.44 %
Adjusted Efficiency Ratio53.06 %53.79 %54.40 %
Operating Leverage5 (basis points)
357 
Adjusted Operating Leverage6 (basis points)
298 
         5 Year-over-year basis point change in noninterest expenses plus change in total revenue
         6 Year-over-year basis point change in adjusted noninterest expense plus change in adjusted total revenue

($ in millions)
3Q20
2Q20
Net Income$77.9 $51.7 
Add: Intangible Amortization (net of tax7)
2.6 2.7 
Tangible Net Income$80.5 $54.4 
Less: Securities Gains/Losses (net of tax7)
(3.7)(0.4)
Add: Loss on Branch Actions (net of tax7)
— 0.1 
Add: ONB Way Charges (net of tax7)
2.2 3.7 
Adjusted Tangible Net Income$79.0 $57.8 
Average Total Shareholders’ Equity2,889.5 2,845.4 
Less: Average Goodwill(1,037.0)(1,037.0)
Less: Average Intangibles(50.9)(54.4)
Average Tangible Shareholders’ Equity$1,801.6 $1,754.0 
Return on Average Tangible Common Equity17.88 %12.41 %
Adjusted Return on Average Tangible Common Equity17.54 %13.18 %
7Tax-effect calculations use the current statutory FTE tax rates (federal + state)

CONFERENCE CALL AND WEBCAST
Old National will host a conference call and live webcast at 9:00 a.m. Central Time on Monday, October 19, 2020, to review third-quarter 2020 financial results. The live audio web cast of the call, along with the corresponding presentation slides, will be available on the Company’s Investor Relations web page at oldnational.com and will be archived there for 12 months. A replay of the call will also be available from Noon Central Time on October 19 through November 2. To access the replay, dial 1-855-859-2056, Conference ID Code 1086029.

ABOUT OLD NATIONAL
Old National Bancorp (NASDAQ: ONB), the holding company of Old National Bank, is the largest bank holding company headquartered in Indiana. With $22.5 billion in assets, it ranks among the top 100 banking companies in the U.S. and has been recognized as a World’s Most Ethical Company by the Ethisphere Institute for nine consecutive years.  Since its founding in Evansville in 1834, Old National Bank has focused on community banking by building long-term, highly



valued partnerships and keeping our clients at the center of all we do. This is an approach to business that we call The ONB Way. Today, Old National’s footprint includes Indiana, Kentucky, Michigan, Minnesota and Wisconsin. In addition to providing extensive services in retail and commercial banking, Old National offers comprehensive wealth management, investment and capital market services. For more information and financial data, please visit Investor Relations at oldnational.com.

USE OF NON-GAAP FINANCIAL MEASURES
This earnings release contains GAAP financial measures and non-GAAP financial measures where management believes it to be helpful in understanding Old National’s results of operations or financial position. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in the tables of this release.
















FORWARD-LOOKING STATEMENT
This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  These statements include, but are not limited to, descriptions of Old National Bancorp’s (“Old National’s”) financial condition, results of operations, asset and credit quality trends and profitability.  Forward-looking statements can be identified by the use of the words “anticipate,” “believe,” “expect,” “intend,” “could” and “should,” and other words of similar meaning.  These forward-looking statements express management’s current expectations or forecasts of future events and, by their nature, are subject to risks and uncertainties, such as statements about the potential impacts of the COVID-19 pandemic. There are a number of factors that could cause actual results to differ materially from those in such statements.  Factors that might cause such a difference include, but are not limited to: the severity, magnitude and duration of the COVID-19 pandemic, including impacts of the pandemic and of businesses’ and governments’ responses to the pandemic on our operations and personnel, and on commercial activity and demand across our and our customers’ businesses; market, economic, operational, liquidity, credit and interest rate risks associated with Old National’s business(including developments and volatility arising from the COVID-19 pandemic); competition; government legislation and policies (including the impact of the Dodd-Frank Wall Street Reform and Consumer Protection Act and its related regulations); ability of Old National to execute its business plan, including the anticipated impact from the ONB Way strategic plan that may differ from current estimates; changes in the economy which could materially impact credit quality trends and the ability to generate loans and gather deposits; failure or circumvention of our internal controls; failure or disruption of our information systems; significant changes in accounting, tax or regulatory practices or requirements, including the impact of the CECL standard as well as changes to address the impact of COVID-19; new legal obligations or liabilities or unfavorable resolutions of litigations; disruptive technologies in payment systems and other services traditionally provided by banks; computer hacking and other cybersecurity threats; other matters discussed in this press release; and other factors identified in our Annual Report on Form 10-K and other periodic filings with the SEC.  These forward-looking statements are made only as of the date of this press release, and Old National does not undertake an obligation to release revisions to these forward-looking statements to reflect events or conditions after the date of this press release.



Financial Highlights (unaudited)
($ and shares in thousands, except per share data)
Three Months EndedNine Months Ended
September 30,June 30,September 30,September 30,September 30,
20202020201920202019
Income Statement
Net interest income$145,573 $145,671 $153,096 $435,015 $455,374 
Tax equivalent adjustment (1)3,379 3,367 3,171 10,069 9,659 
Net interest income - tax equivalent basis148,952 149,038 156,267 445,084 465,033 
Provision for loan losses (4)— 22,545 1,437 39,495 3,483 
Noninterest income64,759 58,461 53,961 180,722 151,591 
Noninterest expense120,234 120,121 122,585 399,099 373,744 
Net income77,944 51,705 69,781 152,289 189,021 
Per Common Share Data
Weighted average diluted shares165,419 165,302 171,551 166,370 173,527 
Net income (diluted)$0.47 $0.32 $0.41 $0.92 $1.09 
Cash dividends0.14 0.14 0.13 0.42 0.39 
Common dividend payout ratio (2)30 %44 %32 %46 %35 %
Book value$17.67 $17.35 $16.66 $17.67 $16.66 
Stock price12.56 13.76 17.20 12.56 17.20 
Tangible common book value (3)11.10 10.75 10.18 11.10 10.18 
Performance Ratios
Return on average assets1.40 %0.96 %1.39 %0.95 %1.26 %
Return on average common equity10.79 %7.27 %9.91 %7.11 %9.12 %
Return on tangible common equity (3)17.56 %12.27 %16.85 %11.66 %15.31 %
Return on average tangible common equity (3)17.88 %12.41 %17.01 %12.12 %16.00 %
Net interest margin (FTE)3.03 %3.14 %3.57 %3.15 %3.58 %
Efficiency ratio (5)55.93 %56.29 %56.44 %63.11 %58.65 %
Net charge-offs (recoveries) to average loans(0.09)%0.02 %0.03 %0.04 %0.02 %
Allowance for loan losses to ending loans (4)0.95 %0.94 %0.47 %0.95 %0.47 %
Non-performing loans to ending loans1.15 %1.04 %1.31 %1.15 %1.31 %
Balance Sheet (EOP)
Total loans$13,892,509 $13,615,701 $12,017,648 $13,892,509 $12,017,648 
Total assets22,460,476 22,102,188 20,438,788 22,460,476 20,438,788 
Total deposits16,506,494 16,319,446 14,448,352 16,506,494 14,448,352 
Total borrowed funds2,725,731 2,641,436 2,831,863 2,725,731 2,831,863 
Total shareholders' equity2,921,149 2,864,255 2,832,530 2,921,149 2,832,530 
Capital Ratios (3)
Risk-based capital ratios (EOP):
    Tier 1 common equity12.10 %11.70 %12.03 %12.10 %12.03 %
    Tier 112.10 %11.70 %12.03 %12.10 %12.03 %
    Total13.10 %12.68 %12.97 %13.10 %12.97 %
Leverage ratio (to average assets)8.15 %8.12 %8.79 %8.15 %8.79 %
Total equity to assets (averages)12.97 %13.16 %13.98 %13.33 %13.84 %
Tangible common equity to tangible assets8.58 %8.45 %8.95 %8.58 %8.95 %
Nonfinancial Data
Full-time equivalent employees 2,4842,5302,7782,4842,778
Banking centers162162192162192
(1) Calculated using the federal statutory tax rate in effect of 21% for all periods.
(2) Cash dividends per share divided by net income per share (basic).
(3) Represents a non-GAAP financial measure. Refer the "Non-GAAP Measures" table for reconciliations to GAAP financial measures.
(4) Beginning January 1, 2020, calculation is based on current expected loss methodology. Prior to January 1, 2020, calculation was
based on incurred loss methodology.
(5) Efficiency ratio is defined as noninterest expense before amortization of intangibles as a percent of FTE net interest income and
      noninterest revenues, excluding net gains from debt securities transactions. This presentation excludes amortization of intangibles
      and net debt securities gains, as is common in other company releases, and better aligns with true operating performance.
FTE - Fully taxable equivalent basis EOP - End of period actual balances N/A - Not applicable




Income Statement (unaudited)
($ and shares in thousands, except per share data)
Three Months EndedNine Months Ended
September 30,June 30,September 30,September 30,September 30,
20202020201920202019
Interest income$160,086 $161,974 $185,853 $490,059 $553,834 
Less: interest expense14,513 16,303 32,757 55,044 98,460 
  Net interest income145,573 145,671 153,096 435,015 455,374 
Provision for loan losses (1)— 22,545 1,437 39,495 3,483 
  Net interest income after provision for loan losses145,573 123,126 151,659 395,520 451,891 
Wealth management fees9,239 9,424 9,160 27,547 27,604 
Service charges on deposit accounts8,698 7,582 11,860 26,357 34,201 
Debit card and ATM fees5,276 4,832 5,370 15,106 16,292 
Mortgage banking revenue18,110 17,313 8,850 46,542 20,996 
Investment product fees5,351 4,845 5,244 16,070 16,106 
Capital markets income5,428 6,179 4,560 15,935 10,227 
Company-owned life insurance2,830 2,968 2,703 8,878 8,602 
Other income4,906 4,807 5,790 13,681 16,077 
Gains (losses) on sales of debt securities4,921 511 424 10,606 1,486 
  Total noninterest income64,759 58,461 53,961 180,722 151,591 
Salaries and employee benefits69,860 66,556 71,729 215,589 214,478 
Occupancy13,930 13,245 11,934 42,308 41,071 
Equipment3,754 3,853 3,954 12,912 12,945 
Marketing2,140 2,395 4,105 7,632 12,267 
Data processing 9,628 9,629 8,961 28,724 28,509 
Communication2,241 2,296 2,349 7,335 8,252 
Professional fees3,083 3,545 5,037 10,921 12,868 
FDIC assessment1,319 2,014 960 4,942 4,501 
Amortization of intangibles3,459 3,612 4,168 10,847 12,965 
Amortization of tax credit investments3,115 287 1,211 8,917 2,039 
Other expense7,705 12,689 8,177 48,972 23,849 
  Total noninterest expense120,234 120,121 122,585 399,099 373,744 
  Income before income taxes90,098 61,466 83,035 177,143 229,738 
  Income tax expense12,154 9,761 13,254 24,854 40,717 
   Net income$77,944 $51,705 $69,781 $152,289 $189,021 
Diluted Earnings Per Share
Net income$0.47 $0.32 $0.41 $0.92 $1.09 
Average Common Shares Outstanding
    Basic164,773164,732170,746165,748172,807
    Diluted165,419165,302171,551166,370173,527
Common shares outstanding at end of period165,333165,093170,031165,333170,031
(1) Beginning January 1, 2020, calculation is based on current expected loss methodology. Prior to January 1, 2020, calculation was
based on incurred loss methodology.



Balance Sheet (unaudited)
($ in thousands)
September 30,June 30,September 30,
202020202019
Assets
  Federal Reserve Bank account$87,682 $54,807 $80,018 
  Money market investments13,437 14,633 19,410 
  Investments:
    Treasury and government-sponsored agencies501,771 489,232 524,919 
    Mortgage-backed securities3,382,280 3,304,054 3,248,367 
    States and political subdivisions1,426,495 1,355,959 1,231,248 
    Other securities462,958 512,375 490,389 
      Total investments5,773,504 5,661,620 5,494,923 
  Loans held for sale, at fair value85,091 122,507 58,285 
  Loans:
    Commercial4,264,568 4,307,505 2,950,559 
    Commercial and agriculture real estate5,701,493 5,403,316 5,112,123 
    Consumer:
      Home equity549,115 547,286 555,905 
      Other consumer loans1,112,034 1,128,296 1,162,438 
    Subtotal of commercial and consumer loans11,627,210 11,386,403 9,781,025 
    Residential real estate2,265,299 2,229,298 2,236,623 
      Total loans13,892,509 13,615,701 12,017,648 
        Total earning assets19,852,223 19,469,268 17,670,284 
Allowance for loan losses (1)(131,388)(128,394)(56,910)
Non-earning Assets:
    Cash and due from banks229,631 241,054 320,822 
    Premises and equipment, net463,253 462,796 492,065 
    Operating lease right-of-use assets77,482 80,400 102,976 
    Goodwill and other intangible assets1,086,252 1,089,711 1,101,045 
    Company-owned life insurance455,975 453,116 447,110 
    Other assets 427,048 434,237 361,396 
      Total non-earning assets2,739,641 2,761,314 2,825,414 
        Total assets$22,460,476 $22,102,188 $20,438,788 
Liabilities and Equity
  Noninterest-bearing demand deposits$5,463,007 $5,217,678 $3,996,264 
  Interest-bearing:
    Checking and NOW accounts4,588,432 4,567,046 3,936,318 
    Savings accounts3,287,302 3,166,680 2,863,718 
    Money market accounts1,904,404 1,895,809 1,821,989 
    Other time deposits1,206,658 1,321,499 1,704,238 
     Total core deposits16,449,803 16,168,712 14,322,527 
  Brokered CD's56,691 150,734 125,825 
     Total deposits16,506,494 16,319,446 14,448,352 
  Federal funds purchased and interbank borrowings1,259 801 240,589 
  Securities sold under agreements to repurchase399,141 367,744 337,551 
  Federal Home Loan Bank advances2,087,648 2,035,014 2,001,960 
  Other borrowings237,683 237,877 251,763 
     Total borrowed funds2,725,731 2,641,436 2,831,863 
Operating lease liabilities88,552 91,845 107,272 
Accrued expenses and other liabilities218,550 185,206 218,771 
     Total liabilities19,539,327 19,237,933 17,606,258 
Common stock, surplus, and retained earnings2,771,865 2,715,212 2,774,016 
Accumulated other comprehensive income (loss), net of tax149,284 149,043 58,514 
     Total shareholders' equity2,921,149 2,864,255 2,832,530 
       Total liabilities and shareholders' equity$22,460,476 $22,102,188 $20,438,788 
(1) Beginning January 1, 2020, calculation is based on current expected loss methodology. Prior to January 1, 2020,
calculation was based on incurred loss methodology.



Average Balance Sheet and Interest Rates (unaudited)
($ in thousands)
Three Months EndedThree Months EndedThree Months Ended
September 30, 2020June 30, 2020September 30, 2019
AverageIncome (1)/Yield/AverageIncome (1)/Yield/AverageIncome (1)/Yield/
Earning Assets:BalanceExpenseRateBalanceExpenseRateBalanceExpenseRate
  Money market and other interest-earning
      investments$137,880 $59 0.17 %$85,680 $34 0.16 %$63,142 $528 3.32 %
  Investments:
    Treasury and government-sponsored agencies454,005 2,457 2.17 %501,838 3,033 2.42 %682,940 4,341 2.54 %
    Mortgage-backed securities3,342,284 17,478 2.09 %3,179,165 17,930 2.26 %3,019,322 18,589 2.46 %
    States and political subdivisions1,383,765 11,860 3.43 %1,293,756 11,757 3.63 %1,172,017 10,896 3.72 %
    Other securities487,405 2,922 2.40 %497,204 3,224 2.59 %499,308 4,049 3.24 %
       Total investments5,667,459 34,717 2.45 %5,471,963 35,944 2.63 %5,373,587 37,875 2.82 %
  Loans: (2)
    Commercial4,274,894 33,223 3.04 %4,049,403 31,729 3.10 %3,018,638 35,428 4.59 %
    Commercial and agriculture real estate5,546,486 55,891 3.94 %5,340,622 58,007 4.30 %5,037,909 71,604 5.56 %
    Consumer:
      Home equity551,380 4,336 3.13 %554,701 4,213 3.06 %557,607 7,102 5.05 %
      Other consumer loans1,120,681 11,635 4.13 %1,135,943 11,530 4.08 %1,175,900 12,226 4.13 %
    Subtotal commercial and consumer loans11,493,441 105,085 3.64 %11,080,669 105,479 3.83 %9,790,054 126,360 5.12 %
    Residential real estate loans2,355,512 23,604 4.01 %2,369,407 23,884 4.03 %2,283,704 24,261 4.25 %
       Total loans13,848,953 128,689 3.66 %13,450,076 129,363 3.82 %12,073,758 150,621 4.91 %
      Total earning assets$19,654,292 $163,465 3.29 %$19,007,719 $165,341 3.46 %$17,510,487 $189,024 4.27 %
Less: Allowance for loan losses (3)(132,447)(107,619)(56,894)
Non-earning Assets:
Cash and due from banks$346,343 $332,745 $264,145 
Other assets2,405,517 2,384,934 2,429,466 
      Total assets$22,273,705 $21,617,779 $20,147,204 
Interest-Bearing Liabilities:
  Checking and NOW accounts$4,607,427 $886 0.08 %$4,431,074 $1,075 0.10 %$3,895,654 $4,448 0.45 %
  Savings accounts3,232,375 634 0.08 %3,060,012 736 0.10 %2,855,401 2,128 0.30 %
  Money market accounts1,902,407 724 0.15 %1,844,488 910 0.20 %1,822,698 4,017 0.87 %
  Other time deposits1,253,058 2,852 0.91 %1,378,115 3,786 1.10 %1,733,492 7,016 1.61 %
     Total interest-bearing deposits10,995,267 5,096 0.18 %10,713,689 6,507 0.24 %10,307,245 17,609 0.68 %
  Brokered CD's150,545 201 0.53 %68,149 291 1.72 %181,425 1,098 2.40 %
     Total interest-bearing deposits and CD's11,145,812 5,297 0.19 %10,781,838 6,798 0.25 %10,488,670 18,707 0.71 %
  Federal funds purchased and interbank borrowings18,347 12 0.25 %143,811 44 0.12 %254,971 1,484 2.31 %
  Securities sold under agreements to repurchase385,149 160 0.16 %350,545 185 0.21 %340,158 715 0.83 %
 Federal Home Loan Bank advances2,021,468 6,709 1.32 %2,144,497 6,844 1.28 %1,889,407 9,123 1.92 %
 Other borrowings237,811 2,335 3.93 %251,738 2,432 3.87 %251,817 2,728 4.33 %
     Total borrowed funds2,662,775 9,216 1.38 %2,890,591 9,505 1.32 %2,736,353 14,050 2.04 %
     Total interest-bearing liabilities13,808,587 14,513 0.42 %13,672,429 16,303 0.48 %13,225,023 32,757 0.98 %
Noninterest-Bearing Liabilities and Shareholders' Equity
Demand deposits$5,291,037 $4,871,002 $3,841,867 
Other liabilities284,536 228,950 262,862 
Shareholders' equity2,889,545 2,845,398 2,817,452 
Total liabilities and shareholders' equity$22,273,705 $21,617,779 $20,147,204 
Net interest rate spread2.87 %2.98 %3.29 %
Net interest margin (FTE)3.03 %3.14 %3.57 %
FTE adjustment$3,379 $3,367 $3,171 
(1) Interest income is reflected on a fully taxable equivalent basis (FTE).
(2) Includes loans held for sale.
(3) Beginning January 1, 2020, calculation is based on current expected loss methodology. Prior to January 1, 2020, calculation was based on incurred loss methodology.



Average Balance Sheet and Interest Rates (unaudited)
($ in thousands)
Nine Months EndedNine Months Ended
September 30, 2020September 30, 2019
AverageIncome (1)/Yield/AverageIncome (1)/Yield/
Earning Assets:BalanceExpenseRateBalanceExpenseRate
  Money market and other interest-earning
      investments$94,149 $442 0.63 %$60,071 $1,140 2.54 %
  Investments:
    Treasury and government-sponsored agencies513,055 9,187 2.39 %694,628 12,544 2.41 %
    Mortgage-backed securities3,231,439 54,474 2.25 %2,763,406 54,991 2.65 %
    States and political subdivisions1,317,136 35,026 3.55 %1,198,962 33,584 3.73 %
    Other securities493,016 9,361 2.53 %497,854 12,553 3.36 %
       Total investments$5,554,646 $108,048 2.59 %$5,154,850 $113,672 2.94 %
  Loans: (2)
    Commercial3,745,803 94,005 3.30 %3,067,830 109,290 4.70 %
    Commercial and agriculture real estate5,359,254 176,337 4.32 %5,015,973 208,894 5.49 %
    Consumer:
      Home equity554,800 14,180 3.41 %567,953 22,089 5.20 %
      Other consumer loans1,141,399 35,384 4.14 %1,189,988 36,436 4.09 %
    Subtotal commercial and consumer loans10,801,256 319,906 3.96 %9,841,744 376,709 5.12 %
    Residential real estate loans2,365,037 71,732 4.04 %2,263,595 71,972 4.24 %
       Total loans13,166,293 391,638 3.93 %12,105,339 448,681 4.91 %
      Total earning assets$18,815,088 $500,128 3.52 %$17,320,260 $563,493 4.32 %
Less: Allowance for loan losses (3)(107,860)(56,442)
Non-earning Assets:
Cash and due from banks$322,318 $242,938 
Other assets2,392,893 2,464,192 
      Total assets$21,422,439 $19,970,948 
Interest-Bearing Liabilities:
  Checking and NOW accounts$4,381,919 $4,820 0.15 %$3,829,213 $11,786 0.41 %
  Savings accounts3,040,889 2,669 0.12 %2,889,977 6,556 0.30 %
  Money market accounts1,843,902 4,141 0.30 %1,772,150 10,572 0.80 %
  Other time deposits1,397,222 11,823 1.13 %1,784,200 21,299 1.60 %
     Total interest-bearing deposits10,663,932 23,453 0.29 %10,275,540 50,213 0.65 %
  Brokered CD's101,112 940 1.24 %194,985 3,457 2.37 %
     Total interest-bearing deposits and CD's10,765,044 24,393 0.30 %10,470,525 53,670 0.69 %
  Federal funds purchased and interbank borrowings184,397 1,296 0.94 %290,699 5,219 2.40 %
  Securities sold under agreements to repurchase355,039 729 0.27 %344,294 2,048 0.80 %
 Federal Home Loan Bank advances2,043,617 21,321 1.39 %1,753,283 29,093 2.22 %
 Other borrowings243,255 7,305 4.00 %251,070 8,430 4.48 %
     Total borrowed funds2,826,308 30,651 1.45 %2,639,346 44,790 2.27 %
     Total interest-bearing liabilities13,591,352 55,044 0.54 %13,109,871 98,460 1.00 %
Noninterest-Bearing Liabilities and Shareholders' Equity
Demand deposits$4,710,969 $3,833,605 
Other liabilities263,841 263,799 
Shareholders' equity2,856,277 2,763,673 
Total liabilities and shareholders' equity$21,422,439 $19,970,948 
Net interest rate spread2.98 %3.32 %
Net interest margin (FTE)3.15 %3.58 %
FTE adjustment$10,069 $9,659 
(1) Interest income is reflected on a fully taxable equivalent basis (FTE).
(2) Includes loans held for sale.
(3) Beginning January 1, 2020, calculation is based on current expected loss methodology. Prior to January 1, 2020, calculation was based on incurred
loss methodology.




Asset Quality (EOP) (unaudited)
($ in thousands)
Three Months EndedNine Months Ended
September 30,June 30,September 30,September 30,September 30,
20202020201920202019
Beginning allowance for loan losses$128,394 $106,380 $56,292 $54,619 $55,461 
Impact of adopting ASC 326 on 1/1/2020 (1)— — N/A41,347 N/A
  Provision for loan losses (1)— 22,545 1,437 39,495 3,483 
     Gross charge-offs(4,169)(2,232)(2,716)(14,846)(8,485)
     Gross recoveries7,163 1,701 1,897 10,773 6,451 
  Net (charge-offs) recoveries2,994 (531)(819)(4,073)(2,034)
Ending allowance for loan losses (1)$131,388 $128,394 $56,910 $131,388 $56,910 
Net charge-offs (recoveries) / average loans (2)(0.09)%0.02 %0.03 %0.04 %0.02 %
Average loans outstanding (2)$13,827,019 $13,435,260 $12,061,705 $13,150,805 $12,097,310 
EOP loans outstanding (2)13,892,509 13,615,701 12,017,648 13,892,509 12,017,648 
Allowance for loan losses / EOP loans (1)(2)0.95 %0.94 %0.47 %0.95 %0.47 %
Underperforming Assets:
   Loans 90 Days and over (still accruing)$90 $779 $703 $90 $703 
   Non-performing loans:
      Nonaccrual loans (3)137,611 125,546 138,498 137,611 138,498 
      TDRs still accruing22,037 16,582 18,884 22,037 18,884 
         Total non-performing loans159,648 142,128 157,382 159,648 157,382 
   Foreclosed properties1,248 1,786 2,941 1,248 2,941 
Total underperforming assets$160,986 $144,693 $161,026 $160,986 $161,026 
Classified and Criticized Assets:
Nonaccrual loans (3)137,611 125,546 138,498 137,611 138,498 
Substandard accruing loans189,524 192,433 145,987 189,524 145,987 
Loans 90 days and over (still accruing)90 779 703 90 703 
Total classified loans - "problem loans"$327,225 $318,758 $285,188 $327,225 $285,188 
Other classified assets3,860 2,565 2,556 3,860 2,556 
Criticized loans - "special mention loans"272,859 220,300 233,519 272,859 233,519 
Total classified and criticized assets$603,944 $541,623 $521,263 $603,944 $521,263 
Non-performing loans / EOP loans (2)1.15 %1.04 %1.31 %1.15 %1.31 %
Allowance to non-performing loans (1)(4)82 %90 %36 %82 %36 %
Under-performing assets / EOP loans (2)1.16 %1.06 %1.34 %1.16 %1.34 %
EOP total assets$22,460,476 $22,102,188 $20,438,788 $22,460,476 $20,438,788 
Under-performing assets / EOP assets0.72 %0.65 %0.79 %0.72 %0.79 %
EOP - End of period actual balances
 (1) Beginning January 1, 2020, calculation is based on current expected loss methodology. Prior to January 1, 2020, calculation was
based on incurred loss methodology.
(2) Excludes loans held for sale.
(3) Includes non-accruing TDRs totaling $7.7 million at September 30, 2020, $11.3 million at June 30, 2020, and $21.8 million at
September 30, 2019.
(4) Includes acquired loans that were recorded at fair value in accordance with ASC 805 at the date of acquisition. As such, the credit risk
      was incorporated in the fair value recorded and no allowance for loan losses was recorded for 2019 quarter ends.




Non-GAAP Measures (unaudited)
($ in thousands)
Three Months EndedNine Months Ended
September 30,June 30,September 30,September 30,September 30,
20202020201920202019
Actual End of Period Balances
GAAP shareholders' equity $2,921,149 $2,864,255 $2,832,530 $2,921,149 $2,832,530 
Deduct:
Goodwill 1,036,994 1,036,994 1,036,994 1,036,994 1,036,994 
Intangibles 49,258 52,717 64,051 49,258 64,051 
1,086,252 1,089,711 1,101,045 1,086,252 1,101,045 
Tangible shareholders' equity $1,834,897 $1,774,544 $1,731,485 $1,834,897 $1,731,485 
Average Balances
GAAP shareholders' equity $2,889,545 $2,845,398 $2,817,452 $2,856,277 $2,763,673 
Deduct:
Goodwill 1,036,994 1,036,994 1,036,306 1,036,994 1,036,274 
Intangibles 50,926 54,449 66,047 54,488 70,361 
1,087,920 1,091,443 1,102,353 1,091,482 1,106,635 
Average tangible shareholders' equity $1,801,625 $1,753,955 $1,715,099 $1,764,795 $1,657,038 
Actual End of Period Balances
GAAP assets $22,460,476 $22,102,188 $20,438,788 $22,460,476 $20,438,788 
Add:
Trust overdrafts17 15 24 17 24 
Deduct:
Goodwill 1,036,994 1,036,994 1,036,994 1,036,994 1,036,994 
Intangibles 49,258 52,717 64,051 49,258 64,051 
1,086,252 1,089,711 1,101,045 1,086,252 1,101,045 
Tangible assets $21,374,241 $21,012,492 $19,337,767 $21,374,241 $19,337,767 
Risk-weighted assets$14,445,341 $14,416,184 $13,975,295 $14,445,341 $13,975,295 
GAAP net income$77,944 $51,705 $69,781 $152,289 $189,021 
Add:
Amortization of intangibles (net of tax)2,595 2,708 3,145 8,152 9,780 
Tangible net income$80,539 $54,413 $72,926 $160,441 $198,801 
Tangible Ratios
Return on tangible common equity17.56 %12.27 %16.85 %11.66 %15.31 %
Return on average tangible common equity17.88 %12.41 %17.01 %12.12 %16.00 %
Return on tangible assets 1.51 %1.04 %1.51 %1.00 %1.37 %
Tangible common equity to tangible assets 8.58 %8.45 %8.95 %8.58 %8.95 %
Tangible common equity to risk-weighted assets 12.70 %12.31 %12.39 %12.70 %12.39 %
Tangible common book value (1)11.10 10.75 10.18 11.10 10.18 
Tangible common equity presentation includes other comprehensive income as is common in other company releases.
(1) Tangible common shareholders' equity divided by common shares issued and outstanding at period-end.
Tier 1 capital$1,748,150$1,686,714$1,681,457$1,748,150$1,681,457
Risk-weighted assets14,445,341 14,416,184 13,975,295 14,445,341 13,975,295 
Tier 1 common equity to risk-weighted assets12.10 %11.70 %12.03 %12.10 %12.03 %

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Cover
Oct. 19, 2020
Cover [Abstract]  
Document Type 8-K
Document Period End Date Oct. 19, 2020
Entity Registrant Name Old National Bancorp /IN/
Entity Incorporation, State or Country Code IN
Entity File Number 001-15817
Entity Tax Identification Number 35-1539838
Entity Address, Address Line One One Main Street
Entity Address, City or Town Evansville,
Entity Address, State or Province IN
Entity Address, Postal Zip Code 47708
City Area Code 800
Local Phone Number 731-2265
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, No Par Value
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