INVESTOR UPDATE Third Quarter 2022
Forward Looking Statement This presentation contains forward-looking statements made pursuant to the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements can often, but not always, be identified by the use of words like “believe”, “continue”, “pattern”, “estimate”, “project”, “intend”, “anticipate”, “expect” and similar expressions or future or conditional verbs such as “will”, would”, “should”, “could”, “might”, “can”, “may”, or similar expressions. These forward-looking statements include, but are not limited to, statements relating to First Merchants’ goals, intentions and expectations; statements regarding the First Merchants’ business plan and growth strategies; statements regarding the asset quality of First Merchants’ loan and investment portfolios; and estimates of First Merchants’ risks and future costs and benefits. These forward-looking statements are subject to significant risks, assumptions and uncertainties that may cause results to differ materially from those set forth in forward-looking statements, including, among other things: possible changes in economic and business conditions; the existence or exacerbation of general geopolitical instability and uncertainty; the effects of a pandemic or other unforeseeable event; the ability of First Merchants to integrate recent acquisitions and attract new customers; possible changes in monetary and fiscal policies, and laws and regulations; the effects of easing restrictions on participants in the financial services industry; the cost and other effects of legal and administrative cases; possible changes in the credit worthiness of customers and the possible impairment of collectability of loans; fluctuations in market rates of interest; competitive factors in the banking industry; changes in the banking legislation or regulatory requirements of federal and state agencies applicable to bank holding companies and banks like First Merchants’ affiliate bank; continued availability of earnings and excess capital sufficient for the lawful and prudent declaration of dividends; changes in market, economic, operational, liquidity, credit and interest rate risks associated with the First Merchants’ business; and other risks and factors identified in each of First Merchants’ filings with the Securities and Exchange Commission. First Merchants undertakes no obligation to update any forward-looking statement, whether written or oral, relating to the matters discussed in this presentation or press release. In addition, the company’s past results of operations do not necessarily indicate its anticipated future results. NON-GAAP FINANCIAL MEASURES These slides contain non-GAAP financial measures. For purposes of Regulation G, a non-GAAP financial measure is a numerical measure of the registrant’s historical or future financial performance, financial position or cash flows that excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable measure calculated and presented in accordance with GAAP in the statement of income, balance sheet or statement of cash flows (or equivalent statements) of the issuer; or includes amounts, or is subject to adjustments that have the effect of including amounts, that are excluded from the most directly comparable measure so calculated and presented. In this regard, GAAP refers to generally accepted accounting principles in the United States. Pursuant to the requirements of Regulation G, First Merchants Corporation has provided reconciliations within the slides, as necessary, of the non-GAAP financial measure to the most directly comparable GAAP financial measure.
Executive Management Team 3 Mark Hardwick Chief Executive Officer Mark K. Hardwick currently serves as the Chief Executive Officer of First Merchants Corporation and First Merchants Bank. Mark joined First Merchants in November of 1997 as Corporate Controller and was promoted to Chief Financial Officer in April of 2002. In 2016, Mark’s title expanded to include Chief Operating Officer, overseeing the leadership responsibilities for finance, operations, technology, risk, legal, and facilities for the corporation. Prior to joining First Merchants Corporation, Mark served as a senior accountant with BKD, LLP in Indianapolis. Mark is a graduate of Ball State University with a Master of Business Administration and Bachelor’s degree in Accounting. He is also a certified public accountant and a graduate of the Stonier School of Banking. FMB: 24 Yrs Banking: 24 Yrs FMB: 7 Yrs Banking: 19 Yrs Michele Kawiecki Chief Financial Officer Michele Kawiecki currently serves as Executive Vice President and Chief Financial Officer for First Merchants Corporation and First Merchants Bank. Michele joined First Merchants in 2015 as Director of Finance. Prior to joining First Merchants, Michele spent 12 years with UMB Financial Corporation in Kansas City, Missouri having served as Senior Vice President of Capital Management and Assistant Treasurer; Director of Corporate Development and the Enterprise Project Management Office; and Chief Risk Officer. Prior to UMB, she worked for PriceWaterhouseCoopers LLP as an Audit Manager. Michele earned both a Master of Science in Accounting and an Executive Master of Business Administration from the University of Missouri-Kansas City and a Bachelor’s degree in Accounting from Dakota Wesleyan University. FMB: 14 Yrs Banking: 34 Yrs Mike Stewart President Mike Stewart currently serves as President for First Merchants Corporation and First Merchants Bank overseeing the Commercial, Private Wealth, and Consumer Lines of Business for the Bank. Mike joined the bank in 2008 as Chief Banking Officer. Prior to joining First Merchants, Mike spent 18 years with National City Bank in various commercial sales and credit roles. Mike has a Master of Business Administration from Butler University and a Bachelor’s degree in Finance from Millikin University. FMB: 14 Yrs Banking: 32 Yrs John Martin Chief Credit Officer John Martin currently serves as Executive Vice President and Chief Credit Officer of First Merchants Corporation overseeing the Commercial, Small Business and Consumer Credit functions, as well as the Mortgage Line of Business. Prior to joining First Merchants, John spent 18 years with National City Bank in various sales and senior credit roles. John is a graduate of Indiana University where he earned a Bachelor of Arts in Economics. He also holds a Master of Business Administration in Finance from Case Western Reserve University.
First Merchants Corporation (NASDAQ: FRME) Financial Highlights as of 9/30/2022 $17.7 Billion $11.7 Billion $14.4 Billion $6.6 Billion Assets Under Advisement* Total Assets Total Loans Total Deposits TCE/TA: YTD Return on TCE YTD ROAA: Dividend Yield: Price / Tangible Book: Price / LTM EPS: 1.19% 6.66% 16.22% 3.15% 2.01x 11.0x Moody’s a3 Baseline Credit Assessment1 Market Cap $2.3B Largest financial services holding company headquartered in Central Indiana 122 Banking Centers 4 *Assets Under Management - $3.1 Billion 1Moody’s Credit Opinion – First Merchants Corporation, September 24, 2021, baseline Credit Assessment (BCA) reflects a bank’s standalone credit strength
Highlights 5 ▪ Reported EPS of $1.08 compared to $0.98 in Q3 2021 and $0.63 in Q2 2022. Excluding Paycheck Protection Program (“PPP”) income and expenses related to the Level One acquisition, current quarter EPS was $1.12 compared to Q3 2021 of $0.87 and Q2 2022 of $1.011,2 ▪ 10.2% annualized organic loan growth on a linked quarter basis, excluding PPP loans ▪ System Integration of Level One Bank completed in August of 2022 ▪ Completed 2 branch consolidations during 3Q 2022, totaling 5 year-to-date 12.54% ROE 20.85% ROTCE ROE & ROTCE (Annualized) $63.3 Million $1.08 Per Share Net Income & EPS1 1.43% ROA 1.73% PTPP ROA ROA (Annualized) 1Net Income and EPS reported on a diluted basis and for common stockholders 2See “Non-GAAP Financial Information” for reconciliation Year-to-Date 10.14% ROE 16.22% ROTCE ROE & ROTCE (Annualized) $150.4 Million $2.62 Per Share Net Income & EPS1 1.19% ROA 1.61% PTPP ROA ROA (Annualized) Third Quarter ▪ Reported EPS of $2.62 compared to $2.92 in 2021. Excluding PPP income and expenses related to the Level One acquisition, current YTD EPS was $3.01 compared to $2.54 in 20211,2
Business Strategy 6 Full Spectrum of Debt Capital and Treasury Service Offerings Located in Prime Growth Markets Small Business & SBA Middle Market C&I Investment Real Estate Public Finance Sponsor Finance Full Spectrum of Consumer Deposit and Lending Offerings Supported by: Talented Customer Service Oriented Banking Center and Call Center Professionals Competitive Digital Solutions ▪ Deposit and CRM ▪ Online Banking ▪ Mobile Banking Diverse Locations in Stable Rural and Growth Metro Markets Comprehensive and coordinated approach to personal wealth management Expertise in: Investment Management Private Banking Fiduciary Estate Financial Planning Strengthen commercial relationships with personal services for executives/owners and retirement plan services for companies Partner with consumer to offer personal investment advice through First Merchants Investment Services Offering a full suite of mortgage solutions to assist with purchasing, constructing, renovating, or refinancing a home. Strengthen existing Commercial, Consumer and Private Wealth relationships Create new household relationships Support underserved borrowers and neighborhoods Deliver solutions through a personalized, efficient, and scalable model Commercial Banking Private Wealth Advisors Consumer Banking Mortgage Banking Asset Based Lending Syndications Treasury Management Services Merchant Processing Services
▪ The Commercial portfolio grew across each segment and each region in the quarter. The pace was slower than the strong 2nd quarter 13% annualized growth rate; however, the commercial pipeline remains strong at the end of September. ▪ Consumer loan growth increases showed continued strength in the current quarter with Private Banking, HELOC and Small Business as the key drivers. Consumer pipeline remains strong at end of September. ▪ On balance sheet, prime Mortgages showed continued growth as adjustable-rate options are preferred to longer term, fixed rates. Mortgage pipeline is weighted towards purchases and construction volumes. 3Q22 2022 YTD Commercial (8.2)% (6.9)% Consumer (6.7)% (4.8)% Total Deposits (3.7)% (2.4)% ▪ Strategic focus on relationship pricing and margin ▪ The decline in balances across both segments is primarily with non-relationship orientated clients or as a result of deploying excess liquidity with their businesses or households Deposit Growth Annualized1 Business Highlights 7 Indianapolis Indianapolis MSA Rank: 7 Deposits: $2.8B Loans: $3.6B Columbus Columbus MSA Rank: 12 Deposits: $0.7B Loans: $1.4B Northwest Indiana Lake County Rank: 6 Lafayette MSA Rank: 2 Deposits: $3.3B Loans: $2.1B Northeast Indiana Muncie MSA Rank: 1 Ft Wayne MSA Rank: 4 Deposits: $4.5B Loans: $2.2B Michigan Monroe MSA Rank: 1 Detroit MSA Rank: 9 Deposits: $3.1B Loans: $2.4B MSA and County ranking data per FDIC Loan Growth Annualized1 3Q22 2022 YTD Commercial 2.3%2 7.5%2 Consumer 21.6% 14.2% Mortgage 48.8% 63.5% Total Loans – Adjusted 10.2%2 13.5%2 1Excluding $1.6 billion of loans and $1.9 billion of deposits acquired from Level One 2Excluding Change in PPP Loans
Third Quarter Financial Results 8 ▪ 53.34% Efficiency Ratio, 51.39% excluding acquisition costs1 ▪ Net interest income, excluding the impact of PPP loan income and fair value accretion, increased $12.2 million over prior quarter and $41.8 million over 3Q 2021 ▪ Pre-Tax, Pre-Provision (PTPP) Earnings totaled $77 million excluding acquisition costs, PTPP ROA was 1.73% and PTPP ROE was 15.25%1 ▪ Declines in TCE Ratio of 0.38% and Tangible Book Value per share of 5.82% reflect the impact of AOCI changes in equity due to market volatility 3Q22 Highlights 1See “Non-GAAP Financial Information” for reconciliation ($M except per share data) 9/30/21 12/31/21 3/31/22 6/30/22 9/30/22 Variance Linked Quarter % Variance Linked QTR- Annualized Balance Sheet & Asset Quality 1. Total Assets $15,060.7 $15,453.1 $15,465.3 $17,780.5 $17,719.0 ($61.5) -1.4% 2. Total Loans 9,047.6 9,253.0 9,360.2 11,406.5 11,675.4 268.9 9.4% 3. Investments 4,445.5 4,524.4 4,489.3 4,630.0 4,294.8 (335.3) -29.0% 4. Deposits 12,348.7 12,732.6 12,906.0 14,570.9 14,434.8 (136.0) -3.7% 5. Common Equity 1,868.1 1,912.6 1,807.6 1,977.6 1,906.7 (71.0) -14.4% 6. TCE Ratio 8.94% 9.01% 8.31% 7.04% 6.66% -0.38% 7. Total RBC Ratio 14.02 13.92 13.85 12.73 12.84% 0.11 8. ACL / Loans 2.21 2.11 2.09 1.98 1.94 -0.04 9. NCOs / Avg Loans -0.01 0.20 -0.03 0.01 -0.01 -0.02 10. NPAs + 90PD / Assets 0.35 0.29 0.33 0.30 0.29 -0.01 Summary Income Statement 11. Net Interest Income $104.7 $101.3 $102.3 $128.7 $140.3 $11.6 36.2% 12. Provision for Loan Losses 0.0 0.0 0.0 16.8 0.0 (16.8) 13. Non-interest Income 28.5 25.8 25.9 28.3 29.6 1.3 19.0% 14. Non-interest Expense 71.4 72.4 72.3 97.3 96.4 (0.9) -3.8% 15. Pre-tax Income 61.8 54.7 55.9 42.9 73.5 30.7 286.0% 16. Provision for Taxes 9.1 7.0 7.3 3.9 9.8 5.9 610.6% 17. Net Income 52.8 47.7 48.6 39.0 63.7 24.7 253.7% 18. Preferred Stock Dividends 0.0 0.0 0.0 0.5 0.5 0.0 19. Net Income Available to Common Stockholders 52.8 47.7 48.6 38.5 63.3 24.7 256.8% 20. ROAA 1.41% 1.25% 1.26% 0.88% 1.43% 0.55% 21. ROAE 11.17 10.10 10.28 7.62 12.54 4.92 22. ROTCE 16.33 14.78 14.99 12.91 20.85 7.94 23. Net Interest Margin 3.20 3.04 3.03 3.28 3.55 0.27 24. Efficiency Ratio 51.18 53.49 52.79 58.45 53.34 -5.11 Per Share 25. Earnings per Diluted Share $0.98 $0.89 $0.91 $0.63 $1.08 $0.45 26. Tangible Book Value per Share 24.31 25.21 23.26 20.45 19.26 (1.19) 27. Dividend per Share 0.29 0.29 0.29 0.32 0.32 0.00 28. Dividend Payout Ratio 29.6% 32.6% 31.9% 50.8% 29.6% -21.2% For the Three Months Ended,
Year-to-Date Financial Results 9 ▪ 54.95% Efficiency Ratio, 51.53% excluding acquisition costs1 ▪ Net interest income, excluding the impact of PPP loan income and fair value accretion, increased $84.4 million or 30.5% over prior year ▪ Pre-Tax, Pre-Provision (PTPP) Earnings totaled $205.1 million excluding acquisition costs, PPTP ROA was 1.61% and PPTP ROE was 13.83%1 ▪ Declines in TCE Ratio of 2.28% and Tangible Book Value per share of 20.77% reflect the impact of AOCI changes in equity due to market volatility and the acquisition of Level One ▪ PPP fee income totaled $3.1 million, a decrease of $24.1 million from prior year. Year-to-Date Highlights 1See “Non-GAAP Financial Information” for reconciliation ($M except per share data) 2020 2021 2022 Variance YOY % Variance YOY Balance Sheet & Asset Quality 1. Total Assets $13,737.4 $15,060.7 $17,719.0 $2,658.3 17.7% 2. Total Loans 9,247.0 9,047.6 11,675.4 2,627.8 29.0% 3. Investments 2,933.3 4,445.5 4,294.8 (150.7) -3.4% 4. Deposits 10,906.2 12,348.7 14,434.8 2,086.1 16.9% 5. Common Equity 1,833.7 1,868.1 1,906.7 38.6 2.1% 6. TCE Ratio 9.57% 8.94% 6.66% -2.28% 7. Total RBC Ratio 14.38 14.02 12.84% -1.18 8. ALLL / Loans 1.37 2.21 1.94 -0.27 9. NCOs / Avg Loans 0.11 0.07 -0.01 -0.08 10. NPAs + 90PD / Assets 0.49 0.35 0.29 -0.06 Summary Income Statement 11. Net Interest Income $279.8 $309.4 $371.2 $61.8 20.0% 12. Provision for Loan Losses 54.2 0.0 16.8 16.8 13. Non-interest Income 82.4 83.5 83.8 0.3 0.4% 14. Non-interest Expense 190.9 206.8 266.0 59.2 28.6% 15. Pre-tax Income 117.2 186.1 172.3 (13.8) -7.4% 16. Provision for Taxes 13.7 28.3 20.9 (7.4) -26.0% 17. Net Income 103.5 157.8 151.3 (6.5) -4.1% 18. Preferred Stock Dividends 0.0 0.0 0.9 0.9 19. Net Income Available to Common Stockholders 103.5 157.8 150.4 (7.4) -4.7% 20. ROAA 1.04% 1.43% 1.19% -0.24% 21. ROAE 7.60 11.32 10.14 -1.18 22. ROTCE 11.47 16.65 16.22 -0.43 23. Net Interest Margin 3.26 3.22 3.30 0.08 24. Efficiency Ratio 50.52 50.10 54.95 4.85 Per Share 25. Earnings per Diluted Share $1.91 $2.92 $2.62 ($0.30) 26. Tangible Book Value per Share 23.48 24.31 19.26 (5.05) 27. Dividend per Share 0.78 0.84 0.93 0.09 28. Dividend Payout Ratio 40.8% 28.8% 35.5% 6.7% For the Nine Months Ended September 30,
▪ Net unrealized AFS Loss of $392.5 million Investment Portfolio Highlights 10 3Q22 Investment Portfolio Composition Yield on Investments (%) / Total Investments ($B) $4.3B Total Investment Portfolio Gains / LossesHighlights Realized Gains ▪ 3Q 2021 $1.7 million ▪ 4Q 2021 $0.4 million ▪ 1Q 2022 $0.6 million ▪ 2Q 2022 $0.1 million ▪ 3Q 2022 $0.4 million Unrealized AFS Loss▪ Effective duration of 6.6 years ▪ 2022/2023 roll off cash flow $260 million / ~2.20% yield ▪ AA rated municipal bond portfolio ▪ Allowance for Credit Losses for Investments of $245,000 ▪ 49% of portfolio classified as Held-to-Maturity Municipal Bonds 58% Mortgage- Backed Securities 24% Collateralized Mortgage Obligations 6% U.S. Agencies 11% Corporate Obligations 1% $4.4 $4.5 $4.5 $4.6 $4.3 2.56% 2.51% 2.55% 2.63% 2.66% 3Q21 4Q21 1Q22 2Q22 3Q22 Investments ($B) Yield on Investments (%)
Commercial & Industrial 28.5% Commercial Real Estate Owner-Occupied 10.9% Commercial Real Estate Non-Owner Occupied 19.7% Construction Land & Land Development 7.1% Agricultural Land & Production 1.9% Public Finance/Other Commercial 7.8% Residential Mortgage 17.3% Home Equity 5.3% Other Consumer 1.5% Loan Portfolio Highlights 11 3Q22 Loan Composition Yield on Loans (%) / Total Loans ($B) $11.7B Total 3Q22 Portfolio by Yield Type Highlights Total loan rate mix as of 3Q22 • $7.7 billion variable rate • $4.0 billion fixed rate ▪ Portfolio composition is ~75% Commercial oriented ▪ Loan yields remained strong at 4.76% ▪ New/renewed loan yields averaged 4.96% for the quarter compared to 3.87% in 2Q22 ▪ Acquired Level One loans totaled $1.6 billion $0.9 $0.7 $0.7$0.4$0.7$0.7 $9.0 $9.3 $9.4 $11.4 $11.7 4.07% 3.87% 3.73% 4.09% 4.76% 3Q21 4Q21 1Q22 2Q22 3Q22 Total Loans ($B) Yield on Loans (%) Fixed Rate 35% LIBOR-Based 23% Prime-Based 15% Other Variable Rates 14% SOFR-Based 13%
Allowance for Credit Losses - Loans 12 3Q22 Allowance for Credit Losses - Loans Highlights ▪ No Q3 provision expense ▪ Year-to-date provision expense of $16.8 million reflects: • $14 million for CECL Day 1 non-PCD loans • $2.8 million for Level One’s unfunded commitments ▪ The reserve for unfunded commitments totals $23.3 million and is recorded in Other Liabilities ▪ The remaining fair value accretion on acquired loans is $34.0 million $200.0 $195.4 $196.0 $226.3 $226.7 2.21% 2.11% 2.09% 1.98% 1.94% 3Q21 4Q21 1Q22 2Q22 3Q22 Allowance Allowance to Loans $130,648 $204,703 $195,397 $226,702 $74,055 $16,599 $751 $13,955 ALLL 12/31/2020 Day 1 CECL Adjustment ACL - Loans 1/1/2021 ACL - Loans 12/31/2021 Level One - PCD Credit Mark Net Recoveries YTD Provision Exp. YTD ACL-Loans 9/30/2022 Increase Decrease Change in ACL – Loans
Deposit Portfolio Highlights 13 3Q22 Deposit Composition Highlights $14.4B Total 1Defined as total deposits less time deposits > $100k Cost of Total Deposits (%) / Total Deposits ($B) ▪ Strong core deposit base • 97% core deposits1 • 23% non-interest bearing • ~54% yield 5 bps or less ▪ Total deposit costs increased to 0.46% • Up 23 bps from 2Q22 ▪ Acquired Level One deposits totaled $1.9 billion Demand Deposits 59% Savings Deposits 35% Certificates & Time Deposits > $100k 3% Certificates & Time Deposits < $100k 3% $12.3 $12.7 $12.9 $14.6 $14.4 0.18% 0.18% 0.13% 0.23% 0.46% 3Q21 4Q21 1Q22 2Q22 3Q22 Total Deposits ($B) Cost of Total Deposits (%)
Net Interest Margin 14 $105.1$97.1 $97.3 $105.1 $107.0$97.8 $107.0 $97.3 $105.1 $110.0$109.2 $107.0 $105.1 $109.2 $110.0 $106.9 1Adjusted for Fair Value Accretion and PPP Loan Income 3Q21 4Q21 1Q22 2Q22 3Q22 1. Net Interest Income - FTE ($millions) 110.0$ 106.9$ 108.0$ 134.8$ 146.6$ 2. Fair Value Accretion 1.5$ 1.5$ 1.0$ 3.2$ 3.2$ 3. PPP Loan Income 8.2$ 3.7$ 1.9$ 0.9$ 0.3$ 4. Adjusted Net Interest Income - FTE1 100.3$ 101.7$ 105.1$ 130.7$ 143.1$ 5. Tax Equivalent Yield on Earning Assets 3.46% 3.29% 3.23% 3.58% 4.11% 6. Interest Expense/Average Earning Assets 0.26% 0.25% 0.20% 0.30% 0.56% 7. Net Interest Margin 3.20% 3.04% 3.03% 3.28% 3.55% 8. Fair Value Accretion Effect 0.04% 0.04% 0.03% 0.08% 0.08% 9. Impact of PPP Loans 0.17% 0.08% 0.03% 0.01% 0.00% 10. Adjusted Net Interest Margin1 2.99% 2.92% 2.97% 3.19% 3.47% $110.0 $106. $108.0 $134.8 $146.6 3.20% 3.04% 3.03% 3.28% 3.55% 3Q21 4Q21 1Q22 2Q22 3Q22 Net Interest Income - FTE ($millions) Net Interest Margin
Non-Interest Income Highlights 15 3Q22 Non-Interest Income Detail ($M) $29.6M Total Non-Interest Income Trends ($M) Fee Income / Revenue Highlights ▪ Customer-related fees totaling $22.9 million for 3Q22, declined $2.9 million from 2Q22 ▪ BOLI gain of $5.3 million was recorded and offset by $1.9 million write-down of an equity investment 20.6% 19.4% 19.3% 17.3% 16.8% $7.4 $7.1 $7.3 $7.6 $7.2 $4.0 $3.4 $2.2 $3.2 $2.5 $6.2 $6.5 $6.4 $7.7 $7.2 $4.2 $3.9 $5.7 $5.2 $4.8 $6.7 $4.9 $4.3 $4.6 $7.9 $28.5M $25.8M $25.9M $28.3M $29.6M 3Q21 4Q21 1Q22 2Q22 3Q22 Wealth Management Gain on Sale of Loans Service Charges Card Payment Fees Other Wealth Management $7.2 24% Gain on Sale of Loans $2.5 8% Service Charges $7.2 24% Card Payment Fees $4.8 16% Gain on Sale of Securities $0.4 1% Derivative Hedge Fees $0.7 2% BOLI $6.7 23% Other Customer Fees $0.5 2%
Non-Interest Expense Highlights 16 3Q22 Non-Interest Expense Detail $96.4M Total Non-Interest Expense Trends ($M) Efficiency Ratio Highlights ▪ 3Q22 included integration costs of $3.4 million and $0.6 million of severance ▪ Core expense increased due to salaries, incentives, and marketing Salary & Benefits $56.0 58% Premises & Equipment $12.7 13% Outside Data Processing $6.8 7% Professional & Other Outside Services $4.5 5% Intangible Asset Amortization $2.3 2% Marketing $2.4 3% FDIC Expense $2.8 3% Other $8.9 9% 51.18% 53.49% 52.79% 58.45% 53.34% $43.3 $42.4 $42.5 $56.0 $56.0 $10.1 $10.6 $11.3 $13.4 $12.7 $4.8 $4.6 $4.4 $4.9 $6.8 $13.2 $14.8 $14.1 $23.0 $20.9 $71.4M $72.4M $72.3M $97.3M $96.4M 3Q21 4Q21 1Q22 2Q22 3Q22 Salary & Benefits Premises & Equipment Outside Data Processing Other 12Q22 and 3Q22 Efficiency Ratio excluding acquisition costs, see “Non-GAAP Financial Information” for reconciliation 50.75%1 51.39%1
Capital Ratios 17 Tangible Common Equity Ratio Common Equity Tier 1 Ratio Total Risk-Based Capital Ratio 9.31% 9.31% 9.57% 9.31% 9.65%9.57%9.31% 9.57% 9.65% 9.04%8.78% ▪ Reduction in TCE due to AOCI changes in equity resulting from market volatility and cash consideration used in acquisition of Level One 8.94% 9.01% 8.31% 7.04% 6.66% 3Q21 4Q21 1Q22 2Q22 3Q22 TCE Ratio Target TCE (9.00%) Highlights 11.75% 11.68% 11.63% 10.27% 10.40% 3Q21 4Q21 1Q22 2Q22 3Q22 CET 1 Ratio Target CET1 Ratio (10.00%) 14.02% 13.92% 13.85% 12.73% 12.84% 3Q21 4Q21 1Q22 2Q22 3Q22 TRBC Ratio Target TRBC Ratio (12.50%)
Loan Portfolio 18 Geography Loan Portfolio Trends ($M) 1Included in C&I and Sponsor above 85% of borrowers within four state Midwest geography 3Q22 Highlights Total Loans grew $291 million, 10.2% annualized, excluding PPP ▪ Residential Mortgage grew $191 million • 76% adjustable-rate mortgages • Combination of 3, 5, 7, 10, and 15 year ARM products • 80% of ARMs are 7 and 10 year • 749 average credit score ▪ Construction/Land/Land Dev. grew $83 million • Commitments $1.4 billion • Utilization 61% Q3 vs. 53% Q2 ▪ Home Equity grew $36 million 3Q21 4Q21 1Q22 2Q22 3Q22 1. Commercial & Industrial 2,125$ 2,213$ 2,283$ 2,681$ 2,703$ 2. Sponsor Finance 448 504 546 619 630 3. CRE Owner Occupied 953 984 972 1,262 1,266 4. Construction/Land/Land Dev. 522 523 553 746 829 5. CRE Non-Owner Occupied 2,150 2,136 2,073 2,423 2,299 6. Agricultural 241 246 209 215 222 7. Public Finance/Other Commercial 782 807 833 894 915 8. Total Commercial Loans 7,221 7,413 7,469 8,840 8,864 9. Residential Mortgage 1,159 1,168 1,230 1,823 2,014 10. Home Equity 531 524 513 586 622 11. Other Consumer 137 148 148 157 175 12. Total Resid. Mortgage & Consumer 1,827 1,840 1,891 2,566 2,811 13. Total Loans 9,048$ 9,253$ 9,360$ 11,406$ 11,675$ 14. Paycheck Protection Program Loans(1) 198$ 107$ 49$ 33$ 11$
Sponsor Finance • Line utilization 40.2% in Q3, 44.5% in Q2 and 44.4% in Q1. Lower with inclusion of Level 1 commitments in Q3 (~34%) • $607 million in Shared National Credits • $0 dollars in operating leases • $78 million of SBA guaranteed loans. Retained $900,000 of non-guaranteed balances related to sold SBA guaranteed loans (< 20). Acquired through acquisition. Loan Portfolio Insights 19 C & I • $116 million Residential Construction • $713 million CRE Construction and Land Construction Finance Home Equity / Other Consumer Residential Mortgage • > 95% of $612 million in consumer loans had a credit score exceeding 669 at origination • $1.7 billion residential mortgage loans Additional $265 million of residential mortgage secured, related to commercial loan relationships • > 90% of $1.4 billion in residential portfolio loans had a credit score at origination exceeding 669 Commercial Mortgage & Consumer C & I Includes commercial and industrial, sponsor and owner- occupied real estate loans Type $ % Multifamily $455 million 64% Student housing $ 73 million 10% Senior Housing $ 10 million 1% Office Construction $ 14 million 2% (excludes ~18% of portfolio residential loans where origination data is unavailable) (excludes ~23% of loans where origination data is unavailable) • $630 million to 61 companies • Senior Debt/Adj. EBITDA Leverage < 3.0X ~ 90% • Total Leverage/Adj. EBITDA < 4.0X ~ 86% • FCCR > 1.50X ~ 85% • <3% classified Substandard
Asset Quality 20 Asset Quality Trends ($M) 3Q22 Highlights 3Q21 4Q21 1Q22 2Q22 3Q22 1. Non-Accrual Loans 51.5$ 43.1$ 42.7$ 46.0$ 43.5$ 2. Other Real Estate 0.7 0.5 6.3 6.5 6.5 3. 90PD Loans 0.2 1.0 2.1 0.6 0.7 4. Renegotiated Loans 0.4 0.3 0.1 0.2 0.2 5. NPAs + 90PD 52.8$ 44.9$ 51.2$ 53.3$ 50.9$ 6. NPAs + 90PD/Loans and ORE 0.58% 0.49% 0.55% 0.47% 0.44% 7. Classified Loans 144.6$ 122.7$ 102.3$ 192.1$ 207.1$ 8. Classified Loans/Loans 1.60% 1.33% 1.09% 1.68% 1.77% 9. Net Charge-offs (QTD) (0.2)$ 4.6$ (0.6)$ 0.3$ (0.4)$ 10. QTD NCO/Avg. Loans (Annualized) -0.01% 0.20% -0.03% 0.01% -0.01% Strong and Stable Asset Quality ▪ NPAs + 90PD declined to 0.44% of loans and ORE • Lowest in five quarters • Non-accrual loans down $2.5 million ▪ Classified Loan/Loans at pre-pandemic levels ▪ Net recovery of $427,000 • -0.01% of average loans (annualized) • Gross charge-offs of $0.9 million with recoveries of $1.3 million ▪ Year to date net recovery of $751,000
Non-Performing Assets 21 Non-Performing Assets Roll Forward ($M) 3Q22 Highlights Strong and Stable Asset Quality ▪ Net non-accrual loans down $2.5 million • $9 million new non-accrual migration • $4.7 million senior living loan • $1 million environmental services • All other less than $500,000 • $10.7 million non-accrual loans resolved • $3.9 million grain marketing • $1.6 million architecture • $0.9 million senior living ▪ Top three non-accrual relationships total $19.5 million • Senior Living (2 relationships) • Medical Office 3Q21 4Q21 1Q22 2Q22 3Q22 1. Beginning Balance NPAs + 90PD 59.0$ 52.8$ 44.9$ 51.2$ 53.3$ Non-Accrual 2. Add: New Non-Accruals 22.6 6.4 4.4 13.1 9.0 3. Less: To Accrual/ (27.9) (9.5) (4.3) (8.9) (10.7) Payoff/Renegotiated 4. Less: To OREO (0.2) - - 0.5 0.1 5. Less: Charge-offs (0.6) (5.3) (0.5) (1.4) (0.9) 6. Non-Accrual Loans Change (6.1) (8.4) (0.4) 3.3 (2.5) Other Real Estate Owned (ORE) 7. Add: New ORE Properties 0.2 - 5.8 0.5 0.1 8. Less: ORE Sold (0.1) - - (0.2) (0.1) 9. Less: ORE Losses (write-downs) - (0.2) - (0.1) - 10. ORE Change 0.1 (0.2) 5.8 0.2 - 11. 90PD Change - 0.8 1.1 (1.5) 0.1 12. Renegotiated Loans Change (0.2) (0.1) (0.2) 0.1 - 13. NPAs + 90PD Change (6.2) (7.9) 6.3 2.1 (2.4) 14. Ending Balance NPAs + 90PD 52.8$ 44.9$ 51.2$ 53.3$ 50.9$
398.9% 192.2% FRME SNL U.S. Bank Track Record of Shareholder Value 22 10-Year Total Return (2011-2021) Earnings per Share Tangible Book Value per Share Dividends per Share CAGR 2011-2021: 27.3% CAGR 2011-2021: 10.1% CAGR 2011-2021: 39.7% Return on Tangible Common Equity $0.34 $1.41 $1.41 $1.65 $1.72 $1.98 $2.12 $3.22 $3.19 $2.74 $3.81 $2.62 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 YTD'22 $9.64 $10.95 $12.17 $13.65 $14.68 $15.85 $16.96 $19.12 $21.94 $24.27 $25.21 $19.26 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 YTD'22 $0.04 $0.10 $0.18 $0.29 $0.41 $0.54 $0.69 $0.84 $1.00 $1.04 $1.13 $0.93 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 YTD'22 4.37% 14.04% 12.69% 12.94% 12.47% 13.26% 13.29% 18.77% 15.81% 12.21% 16.17% 16.22% 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 YTD'22
$1.6 $1.8 $2.7 $3.1 $3.2 $3.2 $3.6 $3.8 $4.8 $4.5 $4.2 $4.2 $4.3 $5.4 $5.8 $6.8 $7.2 $9.4 $9.9 $12.5 $14.1 $15.5 $17.7 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 3Q22 History of Organic and Whole Bank Acquisition Growth 23 Total Assets ($B) Growth Through Acquisition ✓ Experienced Acquirer ✓ Expanded in Current High-Growth Markets ✓ Extended into Additional High-Growth Markets ✓ Added to Franchise with Stable Deposit Gathering Markets 2000 Decatur Bank & Trust 2001 Frances Slocum Bank & Trust 2002 Lafayette Bank & Trust 2003 Commerce National Bank 2008 Lincoln Bank 2012 Shelby County Bank 2013 Citizens Financial Bank 2014 Community Bank 2015 Cooper State Bank Ameriana Bank 2017 Arlington Bank iAB Financial Bank 2019 Monroe Bank & Trust 2022 (Closed April 1, 2022)
Vision for the Future 24 Our Vision: To enhance the financial wellness of the diverse communities we serve. To be the most responsive, knowledgeable, and high-performing bank for our clients, teammates, and shareholders. We are a collection of dynamic colleagues with diverse experiences and perspectives who share a passion for positively impacting lives. We are genuinely committed to attracting and engaging teammates of diverse backgrounds. We believe in the power of inclusion and belonging. ▪ Lead a brand-focused cultural transformation through inclusivity, teamwork, performance management, career development, rewards and work-life balance ▪ Produce organic growth across all lines of business and markets through focused, data-driven industry leading client acquisition, expansion and retention activities ▪ Invest in the digital transformation of our delivery channels to simplify the client experience ▪ Maintain top-quartile financial results supported by industry-leading governance, risk and compliance practices to ensure long-term sustainability ▪ Continue to leverage our core competency in acquisitions to enhance growth, efficiency and high performance ▪ Cultivate a high-quality shareholder base that values environmental, social and governance initiatives inspired by our stakeholder-centric business model Strategic Imperatives: Our Mission: Our Team:
25 APPENDIX
Non-GAAP 26 1 Includes net unrealized gains or losses on securities available for sale, net gains or losses on cash flow hedges, and amounts resulting from the application of the applicable accounting guidance for defined benefit and other postretirement plans. CAPITAL RATIOS (dollars in thousands): 3Q20 3Q21 4Q21 1Q22 2Q22 3Q22 Total Risk-Based Capital Ratio (dollars in thousands) Total Stockholders' Equity (GAAP) 1,833,656 1,868,090 1,912,571 1,807,633 1,977,641 1,906,666 Adjust for Accumulated Other Comprehensive (Income) Loss 1 (65,468) (39,889) (55,113) 84,392 198,556 314,089 Less: Preferred Stock (125) (125) (125) (125) (25,125) (25,125) Add: Qualifying Capital Securities 46,308 46,546 46,606 46,665 25,000 25,000 Less: Tier 1 Capital Deductions - - - - - - Less: Disallowed Goodwill and Intangible Assets (566,072) (565,221) (564,002) (562,887) (743,285) (740,780) Less: Disallowed Deferred Tax Assets - (1,005) (239) (374) (1,554) (1,267) Add: Modified CECL Transition Amount - 34,542 34,542 23,028 23,028 23,028 Total Tier 1 Capital (Regulatory) 1,248,299$ 1,342,938$ 1,374,240$ 1,398,332$ 1,454,261$ 1,501,611$ Qualifying Subordinated Debentures 65,000 65,000 65,000 65,000 143,074 143,089 Allowance for Loan Losses includible in Tier 2 Capital 125,032 139,200 143,241 146,247 175,059 178,490 Total Risk-Based Capital (Regulatory) 1,438,331$ 1,547,138$ 1,582,481$ 1,609,579$ 1,772,394$ 1,823,190$ Net Risk-Weighted Assets (Regulatory) 10,000,878$ 11,037,663$ 11,369,907$ 11,618,250$ 13,918,947$ 14,196,430$ Total Risk-Based Capital Ratio (Regulatory) 14.38% 14.02% 13.92% 13.85% 12.73% 12.84% Common Equity Tier 1 Capital Ratio Total Tier 1 Capital (Regulatory) 1,248,299$ 1,342,938$ 1,374,240$ 1,398,332$ 1,454,261$ 1,501,611$ Less: Qualified Capital Securities (46,308) (46,546) (46,606) (46,665) (25,000) (25,000) Add: Additional Tier 1 Capital Deductions - - - - - - Common Equity Tier 1 Capital (Regulatory) 1,201,991$ 1,296,392$ 1,327,634$ 1,351,667$ 1,429,261$ 1,476,611$ Net Risk-Weighted Assets (Regulatory) 10,000,878$ 11,037,663$ 11,369,907$ 11,618,250$ 13,918,947$ 14,196,430$ Common Equity Tier 1 Capital Ratio (Regulatory) 12.02% 11.75% 11.68% 11.63% 10.27% 10.40% TANGIBLE COMMON EQUITY RATIO (dollars in thousands): 3Q20 3Q21 4Q21 1Q22 2Q22 3Q22 Tangible Common Equity Ratio (dollars in thousands) Total Stockholders' Equity (GAAP) 1,833,656$ 1,868,090$ 1,912,571$ 1,807,633$ 1,977,641$ 1,906,666$ Less: Preferred Stock (125) (125) (125) (125) (25,125) (25,125) Less: Intangible Assets (574,369) (572,323) (570,860) (569,494) (753,649) (750,713) Tangible Common Equity (non-GAAP) 1,259,162$ 1,295,642$ 1,341,586$ 1,238,014$ 1,198,867$ 1,130,828$ Total Assets (GAAP) 13,737,350$ 15,060,725$ 15,453,149$ 15,465,258$ 17,780,492$ 17,718,985$ Less: Intangible Assets (574,369) (572,323) (570,860) (569,494) (753,649) (750,713) Tangible Assets (non-GAAP) 13,162,981$ 14,488,402$ 14,882,289$ 14,895,764$ 17,026,843$ 16,968,272$ Tangible Common Equity Ratio (non-GAAP) 9.57% 8.94% 9.01% 8.31% 7.04% 6.66%
Non-GAAP 27 TANGIBLE COMMON EQUITY PER SHARE (dollars in thousands): 4Q11 4Q12 4Q13 4Q14 4Q15 4Q16 4Q17 4Q18 Tangible Common Equity Per Share Total Stockholders' Equity (GAAP) 514,467$ 552,236$ 634,923$ 726,827$ 850,509$ 901,657$ 1,303,463$ 1,408,260$ Less: Preferred Stock (90,783) (90,908) (125) (125) (125) (125) (125) (125) Less: Intangible Assets (150,471) (149,529) (202,767) (218,755) (259,764) (258,866) (476,503) (469,784) Tax Benefit 2,224 2,249 4,973 6,085 6,278 5,930 6,788 5,017 Tangible Common Equity, Net of Tax (non-GAAP) 275,437$ 314,048$ 437,004$ 514,032$ 596,898$ 648,596$ 833,623$ 943,368$ Common Shares Outstanding 28,559,707 28,692,616 35,921,761 37,669,948 40,664,258 40,912,697 49,158,238 49,349,800 Tangible Common Equity per Share (non-GAAP) 9.64$ 10.95$ 12.17$ 13.65$ 14.68$ 15.85$ 16.96$ 19.12$ 4Q19 3Q20 4Q20 3Q21 4Q21 1Q22 2Q22 3Q22 Tangible Common Equity Per Share Total Stockholders' Equity (GAAP) 1,786,437$ 1,833,656$ 1,875,645$ 1,868,090$ 1,912,571$ 1,807,633$ 1,977,641$ 1,906,666$ Less: Preferred Stock (125) (125) (125) (125) (125) (125) (25,125) (25,125) Less: Intangible Assets (578,881) (574,369) (572,893) (572,323) (570,860) (569,494) (753,649) (750,713) Tax Benefit 7,257 6,292 5,989 5,153 4,875 4,615 8,692 8,197 Tangible Common Equity, Net of Tax (non-GAAP) 1,214,688$ 1,265,454$ 1,308,616$ 1,300,795$ 1,346,461$ 1,242,629$ 1,207,559$ 1,139,025$ Common Shares Outstanding 55,368,482 53,891,733 53,922,359 53,510,745 53,410,411 53,424,823 59,059,866 59,145,414 Tangible Common Equity per Share (non-GAAP) 21.94$ 23.48$ 24.27$ 24.31$ 25.21$ 23.26$ 20.45$ 19.26$
Non-GAAP 28 ADJUSTED EPS EXCLUDING PAYCHECK PROTECTION PROGRAM ("PPP") AND ACQUISITION-RELATED EXPENSES 3Q21 4Q21 1Q22 2Q22 3Q22 9/30/20 YTD 9/30/21 YTD 9/30/22 YTD (Dollars in Thousands, Except Per Share Amounts) Net Income Available to Common Stockholders - GAAP 52,770$ 47,733$ 48,586$ 38,522$ 63,283$ 103,465$ 157,798$ 150,391$ Adjustments: PPP loan income (8,211) (3,721) (1,884) (891) (323) (10,789) (27,179) (3,098) Acquisition-related expenses - - 152 12,549 3,417 - - 16,118 Acquisition-related provision expense - - - 16,755 - - - 16,755 Tax on adjustment 2,013 912 425 (6,967) (759) 2,645 6,664 (7,301) Adjusted Net Income Available to Common Stockholders - NON-GAAP 46,572$ 44,924$ 47,279$ 59,968$ 65,618$ 95,321$ 137,283$ 172,865$ Average Diluted Common Shares Outstanding 53,960 53,660 53,616 59,308 59,339 54,278 54,093 57,468 Diluted Earnings Per Common Share - GAAP 0.98$ 0.89$ 0.91$ 0.63$ 1.08$ 1.91$ 2.92$ 2.62$ Adjustments: PPP loan income (0.15) (0.07) (0.04) (0.01) - (0.20) (0.50) (0.05) Acquisition-related expenses - - - 0.22 0.05 - - 0.27 Acquisition-related provision expense - - - 0.30 - - - 0.30 Tax on adjustment 0.04 0.02 0.01 (0.13) (0.01) 0.05 0.12 (0.13) Adjusted Diluted Earnings Per Common Share - NON-GAAP 0.87$ 0.84$ 0.88$ 1.01$ 1.12$ 1.76$ 2.54$ 3.01$ PRE-TAX, PRE-PROVISION ("PTPP") EARNINGS EXCLUDING ACQUISITION-RELATED EXPENSES 3Q21 4Q21 1Q22 2Q22 3Q22 9/30/20 YTD 9/30/21 YTD 9/30/22 YTD (Dollars in Thousands, Except Per Share Amounts) Net Interest Income (GAAP) 104,715$ 101,273$ 102,280$ 128,661$ 140,307$ 279,816$ 309,407$ 371,247$ Other Income (GAAP) 28,501 25,847 25,897 28,277 29,616 82,443 83,476 83,790 Total Revenue 133,216 127,120 128,177 156,938 169,923 362,259 392,883 455,037 Less: Other Expenses (GAAP) (71,384) (72,436) (72,325) (97,313) (96,378) (190,869) (206,777) (266,016) Add: Acquisition-Related Expenses (GAAP) - 528 152 12,549 3,417 (111) - 16,118 Pre-Tax, Pre-Provision Earnings (non-GAAP) 61,832$ 55,212$ 56,004$ 72,174$ 76,962$ 171,279$ 186,106$ 205,139$ Average Assets (GAAP) 15,006,087$ 15,298,655$ 15,464,605$ 17,778,221$ 17,770,623$ 13,297,789$ 14,672,596$ 17,012,930$ Average Equity (GAAP) 1,889,037$ 1,890,229$ 1,891,223$ 2,021,123$ 2,018,156$ 1,814,471$ 1,858,680$ 1,977,299$ Average Diluted Common Shares 53,960 53,660 53,616 59,308 59,339 54,278 54,093 57,468 PTPP/Average Assets (PTPP ROA) 1.65% 1.44% 1.45% 1.62% 1.73% 1.72% 1.69% 1.61% PTPP/Average Equity (PTPP ROE) 13.09% 11.68% 11.85% 14.28% 15.25% 12.59% 13.35% 13.83% PTPP/Average Diluted Common Shares 1.15$ 1.03$ 1.04$ 1.22$ 1.30$ 3.16$ 3.44$ 3.57$
Non-GAAP 29 EFFICIENCY RATIO EXCLUDING ACQUISITION-RELATED EXPENSES (dollars in thousands): 3Q22 3Q22 YTD EFFICIENCY RATIO (dollars in thousands): Non Interest Expense (GAAP) 96,378$ 266,016$ Less: Intangible Asset Amortization (2,303) (5,972) Less: OREO and Foreclosure Expenses (328) (626) Less: Acquisition-Related Expenses (3,417) (16,118) Adjusted Non Interest Expense (non-GAAP) 90,330 243,300 Net Interest Income (GAAP) 140,306 371,247 Plus: Fully Taxable Equivalent Adjustment 6,316 18,220 Net Interest Income on a Fully Taxable Equivalent Basis (non-GAAP) 146,622 389,467 Non Interest Income (GAAP) 29,617 83,791 Less: Investment Securities Gains (Losses) (481) (1,137) Adjusted Non Interest Income (non-GAAP) 29,136 82,654 Adjusted Revenue (non-GAAP) 175,758 472,121 Efficiency Ratio Excluding Acquisition-Related Expenses (non-GAAP) 51.39% 51.53% EFFICIENCY RATIO (dollars in thousands): 3Q21 4Q21 1Q22 2Q22 3Q22 3Q20 YTD 3Q21 YTD 3Q22 YTD EFFICIENCY RATIO (dollars in thousands): Non Interest Expense (GAAP) 71,384$ 72,436$ 72,325$ 97,313$ 96,378$ 190,869$ 206,777$ 266,016$ Less: Intangible Asset Amortization (1,463) (1,463) (1,366) (2,303) (2,303) (4,511) (4,284) (5,972) Less: OREO and Foreclosure Expenses 91 (171) (564) 266 (328) (1,906) (821) (626) Adjusted Non Interest Expense (non-GAAP) 70,012 70,802 70,395 95,276 93,747 184,452 201,672 259,418 Net Interest Income (GAAP) 104,715 101,273 102,280 128,661 140,306 279,816 309,407 371,247 Plus: Fully Taxable Equivalent Adjustment 5,331 5,594 5,736 6,168 6,316 12,322 14,991 18,220 Net Interest Income on a Fully Taxable Equivalent Basis (non-GAAP) 110,046 106,867 108,016 134,829 146,622 292,138 324,398 389,467 Non Interest Income (GAAP) 28,501 25,847 25,897 28,277 29,617 82,443 83,476 83,791 Less: Investment Securities Gains (Losses) (1,756) (358) (566) (90) (481) (9,497) (5,316) (1,137) Adjusted Non Interest Income (non-GAAP) 26,745 25,489 25,331 28,187 29,136 72,946 78,160 82,654 Adjusted Revenue (non-GAAP) 136,791 132,356 133,347 163,016 175,758 365,084 402,558 472,121 Efficiency Ratio (non-GAAP) 51.18% 53.49% 52.79% 58.45% 53.34% 50.52% 50.10% 54.95%
Non-GAAP 30 RETURN ON TANGIBLE COMMON EQUITY (dollars in thousands): 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 YTD Return on Tangible Common Equity Total Average Stockholders' Equity (GAAP) 478,440$ 535,506$ 540,255$ 675,295$ 753,724$ 884,664$ 1,110,524$ 1,343,861$ 1,569,615$ 1,814,471$ Less: Average Preferred Stock (74,181) (90,908) (47,537) (125) (125) (125) (125) (125) (125) (125) Less: Average Intangible Assets, Net of Tax (149,554) (147,889) (153,519) (199,354) (215,281) (254,332) (360,005) (467,421) (499,622) (569,963) Average Tangible Common Equity, Net of Tax (non-GAAP) 254,705$ 296,709$ 339,199$ 475,816$ 538,318$ 630,207$ 750,394$ 876,315$ 1,069,868$ 1,244,383$ Net Income Available to Common Stockholders (GAAP) 9,013$ 40,583$ 42,150$ 60,162$ 65,384$ 81,051$ 96,070$ 159,139$ 164,460$ 103,465$ Less: Intangible Asset Amortization, Net of Tax 2,112 1,081 892 1,395 1,720 2,542 3,670 5,307 4,736 3,564 Tangible Net Income (non-GAAP) 11,125$ 41,664$ 43,042$ 61,557$ 67,104$ 83,593$ 99,740$ 164,446$ 169,196$ 107,029$ Return on Tangible Common Equity (non-GAAP) 4.37% 14.04% 12.69% 12.94% 12.47% 13.26% 13.29% 18.77% 15.81% 11.47% RETURN ON TANGIBLE COMMON EQUITY (dollars in thousands): 2020 3Q21 2021 YTD 4Q21 2021 1Q22 2Q22 3Q22 2022 YTD Return on Tangible Common Equity Total Average Stockholders' Equity (GAAP) 1,825,135$ 1,889,037$ 1,858,680$ 1,890,229$ 1,866,632$ 1,891,223$ 2,021,123$ 2,018,156$ 1,977,299$ Less: Average Preferred Stock (125) (125) (125) (125) (125) (125) (25,125) (25,125) (16,792) Less: Average Intangible Assets, Net of Tax (569,377) (567,852) (567,815) (566,616) (567,512) (565,476) (745,614) (744,069) (685,707) Average Tangible Common Equity, Net of Tax (non-GAAP) 1,255,633$ 1,321,060$ 1,290,740$ 1,323,488$ 1,298,995$ 1,325,622$ 1,250,384$ 1,248,962$ 1,274,800$ Net Income Available to Common Stockholders (GAAP) 148,600$ 52,770$ 157,798$ 47,733$ 205,531$ 48,586$ 38,521$ 63,283$ 150,391$ Less: Intangible Asset Amortization, Net of Tax 4,730 1,156 3,384 1,156 4,540 1,079 1,820 1,819 4,718 Tangible Net Income (non-GAAP) 153,330$ 53,926$ 161,182$ 48,889$ 210,071$ 49,665$ 40,341$ 65,102$ 155,109$ Return on Tangible Common Equity (non-GAAP) 12.21% 16.33% 16.65% 14.78% 16.17% 14.99% 12.91% 20.85% 16.22%