Old National Bancorp : reports 2021 record net income driven by commercial loan growth of 7.2% – Form 8-K

0



Old National reports 2021 record net income driven by

commercial loan growth of 7.2%

Evansville, Ind. (January 18, 2022)

Old National Bancorp (NASDAQ: ONB) reports 4Q21 net income of $56.2 million, diluted EPS of $0.34.

Adjusted1 net income of $60.9 million, or $0.37 per diluted share.

Full-year net income of $277.5 million, or $1.67 per diluted share.

Adjusted1 net income of $286.5 million, or$1.73 per diluted share.

CEO COMMENTARY:

“Old National’s 4th quarter capped off a year of record earnings driven by robust commercial loan growth, strong credit quality and well controlled expenses,” said Chairman and CEO Jim Ryan. “I’m particularly pleased that we achieved these strong results while also working steadily to remain on-task to complete our anticipated merger with First Midwest Bank – which also enjoyed strong 4th quarter and full-year 2021 results.”

FOURTH QUARTER HIGHLIGHTS2:

Net income

•Net income of $56.2 million

•Earnings per diluted share of $0.34

Net interest income/NIM

•Net interest income on a fully taxable equivalent basis of $150.2 million compared to $155.1 million

•Net interest margin on a fully taxable equivalent basis of 2.77% compared to 2.92%

Operating Performance

•Pre-provision net revenue1 (“PPNR”) of $69.8 million

•Adjusted PPNR1 of $78.1 million

•Noninterest expense of $131.9 million

•Adjusted noninterest expense1 of $123.2 million

•Efficiency ratio1 of 64.27%

•Adjusted efficiency ratio1 of 59.95%

Loans and Credit Quality

•End-of-period total loans3 of $13,637.3 million compared to $13,636.1 million

â—¦Total commercial loans increased $162.5 million, excluding the $185.9 million decrease in PPP loans

•Fourth-quarter total commercial production of $1.1 billion

•Provision for credit losses was a recapture of $1.9 million

•December 31 pipeline of $2.5 billion

•Net recoveries of $1.4 million compared to net recoveries of $3.0 million

•Non-performing loans of 0.92% of total loans compared to 0.94%

Return Profile & Capital

•Return on average common equity of 7.49%

•Return on average tangible common equity1 of 12.07%

•Adjusted return on average tangible common equity1 of 13.04%

•No shares of common stock were repurchased during the current quarter

Notable Items

•$2.0 million in tax credit amortization

•$6.7 million in merger-related charges

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 (“Old National”) reported fourth quarter 2021 net income of $56.2 million, or $0.34 per diluted share.

Included in the fourth quarter were pre-tax charges of $6.7 million related to the pending merger with First Midwest Bancorp, Inc. Excluding these charges from the current quarter and netting out debt securities gains, adjusted net income was $60.9 million, or $0.37 per diluted share.

LOANS

Strong commercial production resulted in 6.9% annualized commercial loan growth.

•Period-end total loans were $13,637.3 million at December 31, 2021, consistent with the $13,636.1 million at September 30, 2021.

•Paycheck Protection Program (PPP) loans declined $185.9 million to $169.0 million at December 31, 2021, compared to $354.9 million at September 30, 2021.

•Excluding the $185.9 million decrease in PPP loans during the quarter, total loans increased $187.1 million, or 5.6% annualized.

•Excluding PPP loans, total commercial loans increased $162.5 million, or 6.9% annualized.

•Total commercial loan production in the fourth quarter was $1.1 billion; period-end pipeline totaled $2.5 billion.

•Consumer loans increased $9.9 million to $1,574.1 million and residential mortgage loans increased $30.5 million to $2,255.3 million.

•Average total loans in the fourth quarter were $13,603.6 million, a decrease of $83.7 million from the third quarter of 2021.

•Excluding PPP loans, average total loans in the fourth quarter increased $178.1 million from the third quarter of 2021.

DEPOSITS

Total deposit growth bolstered by strong increase in checking and NOW accounts.

•Period-end total deposits were $18,569.2 million at December 31, 2021, an increase of $373.0 million, or 8.2% annualized, when compared to the $18,196.1 million at September 30, 2021.

•Checking and NOW deposits increased $382.0 million to $5,338.0 million at December 31, 2021 from $4,956.0 million at September 30, 2021.

•On average, total deposits in the fourth quarter increased $438.3 million to $18,414.3 million, compared to $17,976.0 million in the third quarter of 2021.

NET INTEREST INCOME AND MARGIN

Decrease in PPP interest and fees negatively impact net interest income and margin; funding costs modestly lower.

•Net interest income decreased to $146.8 million in the fourth quarter of 2021 compared to $151.6 million in the third quarter of 2021.

•The net interest margin on a fully taxable equivalent basis decreased 15 basis point to 2.77% compared to 2.92% in the third quarter of 2021.

•PPP interest and net fees combined were $7.7 million, or 11 basis points of net interest margin, in the fourth quarter of 2021 compared to $12.2 million, or 16 basis points of net interest margin, in the third quarter of 2021.

•Accretion income was $3.9 million, or 7 basis points of net interest margin, in the fourth quarter of 2021 compared to $3.0 million, or 6 basis points of net interest margin, in the third quarter of 2021.

•Interest collected on nonaccrual loans was $1.4 million, or 3 basis points of net interest margin, in the fourth quarter of 2021 compared to $2.3 million, or 4 basis points of net interest margin, in the third quarter of 2021.

•The cost of total deposits declined 1 basis point to 0.05% in the fourth quarter of 2021 and the cost of total interest-bearing deposits also declined 1 basis point to 0.08%.

CREDIT QUALITY

Strong credit quality remains a hallmark of the Old National franchise.

•Old National recorded a provision recapture in the fourth quarter of 2021 of $1.9 million, compared to $4.6 million in provision recapture recorded in the third quarter of 2021.

•Net recoveries in the fourth quarter were $1.4 million, compared to net recoveries of $3.0 million in the third quarter of 2021.

•30-89 day delinquencies were 0.11% at the end of the fourth quarter.

•Non-performing loans decreased as a percentage of total loans to 0.92%.

•Loans acquired from previous acquisitions were recorded at fair value at the acquisition date. As of December 31, 2021, the remaining discount on these acquired loans was $33.7 million.

•The allowance for credit losses stood at $107.3 million, or 0.79% of total loans at December 31, 2021.

NONINTEREST INCOME

Noninterest income decreased primarily due to lower mortgage banking revenue.

•Total noninterest income for the fourth quarter of 2021 was $51.5 million, a decrease of $3.0 million from the third quarter of 2021.

•Mortgage banking revenue decreased $3.5 million when compared to the third quarter of 2021, due primarily to a smaller pipeline.

•Gains on sales of debt securities decreased $0.8 million when compared to the third quarter of 2021.

NONINTEREST EXPENSE

Increase in fourth quarter expenses due primarily to increased personnel and marketing expenses.

•Noninterest expense for the fourth quarter of 2021 was $131.9 million and included $6.7 million in merger-related charges and $2.0 million in tax credit amortization.

•Excluding these items, adjusted noninterest expense for the fourth quarter was $123.2 million, compared to the $118.2 million in adjusted noninterest expense in the third quarter of 2021.

•The fourth quarter efficiency ratio was 64.27%, while the adjusted efficiency ratio was 59.95%.

INCOME TAXES

•On a fully taxable-equivalent basis, income tax expense in the fourth quarter was $15.5 million, resulting in a 21.6% FTE tax rate, compared to 22.8% in the third quarter of 2021.

•Income tax expense included $2.9 million in tax credit benefit.

CAPITAL AND LIQUIDITY

Capital ratios remain strong.

•At the end of the fourth quarter, preliminary total risk-based capital was 12.77% and preliminary regulatory tier 1 capital was 12.04%.

•Tangible common equity to tangible assets was 8.30% at the end of the fourth quarter compared to 8.55% in the third quarter of 2021.

•The Company did not repurchase any shares of common stock during the fourth quarter.

•A low loan to deposit ratio of 73.4%, combined with existing funding sources plus available unencumbered, high-quality collateral, provides strong liquidity.

NON-GAAP RECONCILIATIONS

($ in millions, except EPS, shares in 000s)

4Q21

Adjustments4

Adjusted 4Q21

Total Revenues (FTE) $ 201.7 $ (0.4) $ 201.3
Less: Provision for Credit Losses 1.9 1.9
Less: Noninterest Expenses (131.9) 6.7 (125.2)
Income before Income Taxes (FTE) $ 71.7 $ 6.3 $ 78.0
Income Taxes (FTE) (15.5) (1.6) (17.1)
Net Income $ 56.2 $ 4.7 $ 60.9
Average Shares Outstanding 166,128 166,128
Earnings Per Share – Diluted $ 0.34 $ 0.03 $ 0.37

4 Tax-effect calculations use the current statutory FTE tax rates (federal + state)

($ in millions, except EPS, shares in 000s) 2021

Adjustments4

Adjusted 2021

Total Revenues (FTE) $ 824.5 $ (4.3) $ 820.2
Less: Provision for Credit Losses 28.8 28.8
Less: Noninterest Expenses (500.5) 16.5 (484.0)
Income before Income Taxes (FTE) $ 352.8 $ 12.2 $ 365.0
Income Taxes (FTE) (75.3) (3.2) (78.5)
Net Income $ 277.5 $ 9.0 $ 286.5
Average Shares Outstanding 165,929 165,929
Earnings Per Share – Diluted $ 1.67 $ 0.06 $ 1.73

4 Tax-effect calculations use the current statutory FTE tax rates (federal + state)

($ in millions)

4Q21

3Q21

Net Interest Income $ 146.8 $ 151.6
Add: FTE Adjustment 3.4 3.5
Net Interest Income (FTE) $ 150.2 $ 155.1
Average Earning Assets $ 21,670.7 $ 21,228.6
Net Interest Margin (FTE) 2.77 % 2.92 %
($ in millions)

4Q21

4Q20

Net Interest Income $ 146.8 $ 161.1
Add: FTE Adjustment 3.4 3.5
Net Interest Income (FTE) $ 150.2 $ 164.6
Add: Total Noninterest Income 51.5 58.5
Less: Noninterest Expense 131.9 142.3
Pre-Provision Net Revenue $ 69.8 $ 80.8
Less: Debt Securities Gains/Losses (0.4) (0.2)
Less: Gain on Branch Actions (0.1)
Add: Merger-Related Charges 6.7
Add: ONB Way Charges 3.6
Add: Amortization of Tax Credit Investments 2.0 9.9
Adjusted Pre-Provision Net Revenue $ 78.1 $ 94.0
($ in millions)

4Q21

3Q21

4Q20

2021

2020

Noninterest Expense $ 131.9 $ 121.3 $ 142.3 $ 500.5 $ 541.4
Less: ONB Way Charges (3.6) (1.9) (42.6)
Less: Merger-Related Charges (6.7) (1.4) (14.6)
Noninterest Expense less Charges $ 125.2 $ 119.9 $ 138.7 $ 484.0 $ 498.8
Less: Amortization of Tax Credit Investments (2.0) (1.7) (9.9) (6.7) (18.8)
Adjusted Noninterest Expense $ 123.2 $ 118.2 $ 128.8 $ 477.3 $ 480.0
Less: Intangible Amortization (2.6) (2.8) (3.3) (11.4) (14.1)
Adjusted Noninterest Expense Less Intangible Amortization $ 120.6 $ 115.4 $ 125.5 $ 465.9 $ 465.9
Net Interest Income $ 146.8 $ 151.6 $ 161.1 $ 596.4 $ 596.1
FTE Adjustment 3.4 3.5 3.5 13.9 13.6
Net Interest Income (FTE) $ 150.2 $ 155.1 $ 164.6 $ 610.3 $ 609.7
Total Noninterest Income 51.5 54.5 58.5 214.2 239.2
Total Revenue (FTE) $ 201.7 $ 209.6 $ 223.1 $ 824.5 $ 848.9
Less: Debt Securities Gains/Losses (0.4) (1.2) (0.2) (4.3) (10.8)
Less: Gain on Branch Actions (0.1)
Adjusted Total Revenue (FTE) $ 201.3 $ 208.4 $ 222.8 $ 820.2 $ 838.1
Efficiency Ratio 64.27 % 56.86 % 62.37 % 59.65 % 62.91 %
Adjusted Efficiency Ratio 59.95 % 55.38 % 56.35 % 56.80 % 55.59 %
($ in millions)

4Q21

3Q21

Net Income $ 56.2 $ 71.7

Add: Intangible Amortization (net of tax5)

1.9 2.1
Tangible Net Income $ 58.1 $ 73.8

Less: Securities Gains/Losses (net of tax5)

(0.3) (0.9)

Add: Merger-Related Charges (net of tax5)

5.0 1.1
Adjusted Tangible Net Income $ 62.8 $ 74.0
Average Total Shareholders’ Equity 2,998.8 3,027.9
Less: Average Goodwill (1,037.0) (1,037.0)
Less: Average Intangibles (36.0) (38.6)
Average Tangible Shareholders’ Equity $ 1,925.8 $ 1,952.3
Return on Average Tangible Common Equity 12.07 % 15.13 %
Adjusted Return on Average Tangible Common Equity 13.04 % 15.16 %

5 Tax-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 Tuesday, January 18, 2022, to review fourth-quarter 2021 financial results. The live audio webcast link and 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. To listen to the live conference call, dial U.S. (877) 660-9071 or International (929) 517-9523, Conference I.D. 3313815. A replay of the call will also be available from Noon Central Time on January 18 through February 1. To access the replay, dial (855) 859-2056, Conference ID Code 3313815.

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 $24.5 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 ten 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 STATEMENTS

This communication includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, with respect to Old National’s future plans, objectives, performance, revenues, growth, profits, operating expenses or Old National’s underlying assumptions; First Midwest’s and Old National’s beliefs, goals, intentions, and expectations regarding the proposed transaction, revenues, earnings, loan production, asset quality, and capital levels, among other matters; our estimates of future costs and benefits of the actions we may take; our assessments of expected losses on loans; our assessments of interest rate and other market risks; our ability to achieve our financial and other strategic goals; the expected timing of completion of the proposed transaction; the expected cost savings, synergies and other anticipated benefits from the proposed transaction; and other statements that are not historical facts.

Forward‐looking statements are typically identified by such words as “believe,” “expect,” “anticipate,” “intend,” “outlook,” “estimate,” “forecast,” “project,” “should,” “will,” and other similar words and expressions, and are subject to numerous assumptions, risks, and uncertainties, which change over time. These forward-looking statements include, without limitation, those relating to the terms, timing and closing of the proposed transaction.

Additionally, forward‐looking statements speak only as of the date they are made; Old National does not assume any duty, and does not undertake, to update such forward‐looking statements, whether written or oral, that may be made from time to time, whether as a result of new information, future events, or otherwise. Furthermore, because forward‐looking statements are subject to assumptions and uncertainties, actual results or future events could differ, possibly materially, from those indicated in such forward-looking statements as a result of a variety of factors, many of which are beyond the control of Old National. Such statements are based upon the current beliefs and expectations of the management of Old National and are subject to significant risks and uncertainties outside of the control of the parties. Caution should be exercised against placing undue reliance on forward-looking statements. The factors that could cause actual results to differ materially include the following: the occurrence of any event, change or other circumstances that could give rise to the right of one or both of the parties to terminate the definitive merger agreement between First Midwest and Old National; the outcome of any legal proceedings that may be instituted against First Midwest or Old National; the possibility that the proposed transaction will not close when expected or at all because required regulatory or other approvals are not received or other conditions to the closing are not satisfied on a timely basis or at all, or are obtained subject to conditions that are not anticipated (and the risk that required regulatory approvals may result in the imposition of conditions that could adversely affect the combined company or the expected benefits of the proposed transaction); the ability of First Midwest and Old National to meet expectations regarding the timing, completion and accounting and tax treatments of the proposed transaction; the risk that any announcements relating to the proposed transaction could have adverse effects on the market price of the common stock of either or both parties to the proposed transaction; the possibility that the anticipated benefits of the proposed transaction will not be realized when expected or at all, including as a result of the impact of, or problems arising from, the integration of the two companies or as a result of the strength of the economy and competitive factors in the areas where First Midwest and Old National do business; certain restrictions during the pendency of the proposed transaction that may impact the parties’ ability to pursue certain business opportunities or strategic transactions; the possibility that the transaction may be more expensive to complete than anticipated, including as a result of unexpected factors or events; diversion of management’s attention from ongoing business operations and opportunities; the possibility that the parties may be unable to achieve expected synergies and operating efficiencies in the merger within the expected timeframes or at all and to successfully integrate First Midwest’s operations and those of Old National; such integration may be more difficult, time consuming or costly than expected; revenues following the proposed transaction may be lower than expected; First Midwest’s and Old National’s success in executing their respective business plans and strategies and managing the risks involved in the foregoing; the dilution caused by Old National’s issuance of additional shares of its capital stock in connection with the proposed transaction; effects of the announcement, pendency or completion of the proposed transaction on the ability of First Midwest and Old National to retain customers and retain and hire key personnel and maintain relationships with their suppliers, and on their operating results and businesses generally; risks related to the potential impact of general economic, political and market factors on the companies or the proposed transaction and other factors that may affect future results of First Midwest and Old National; uncertainty as to the

extent of the duration, scope, and impacts of the COVID-19 pandemic on First Midwest, Old National and the proposed transaction; and the other factors discussed in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of each of First Midwest’s and Old National’s Annual Report on Form 10‐K for the year ended December 31, 2020, in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of each of First Midwest’s and Old National’s Quarterly Report on Form 10‐Q for the quarter ended September 30, 2021, and in other reports First Midwest and Old National file with the U.S. Securities and Exchange Commission (the “SEC”).

Financial Highlights (unaudited)
($ and shares in thousands, except per share data)
Three Months Ended Twelve Months Ended
December 31, September 30, December 31, December 31, December 31,
2021 2021 2020 2021 2020
Income Statement
Net interest income $ 146,781 $ 151,572 $ 161,079 $ 596,400 $ 596,094
Tax equivalent adjustment (1) 3,442 3,501 3,517 13,913 13,586
Net interest income – tax equivalent basis 150,223 155,073 164,596 610,313 609,680
Provision for credit losses (1,914) (4,613) (1,100) (28,812) 38,395
Noninterest income 51,484 54,515 58,552 214,219 239,274
Noninterest expense 131,937 121,274 142,318 500,569 541,417
Net income 56,188 71,746 74,120 277,538 226,409
Per Common Share Data
Weighted average diluted shares 166,128 165,939 165,631 165,929 166,177
Net income (diluted) $ 0.34 $ 0.43 $ 0.44 $ 1.67 $ 1.36
Cash dividends 0.14 0.14 0.14 0.56 0.56
Common dividend payout ratio (2) 41 % 33 % 31 % 33 % 41 %
Book value $ 18.16 $ 18.31 $ 17.98 $ 18.16 $ 17.98
Stock price 18.12 16.95 16.56 18.12 16.56
Tangible common book value (3) 11.70 11.83 11.43 11.70 11.43
Performance Ratios
Return on average assets 0.93 % 1.20 % 1.30 % 1.17 % 1.04 %
Return on average common equity 7.49 % 9.48 % 10.11 % 9.26 % 7.87 %
Return on tangible common equity (3) 11.98 % 15.05 % 16.20 % 14.74 % 12.54 %
Return on average tangible common equity (3) 12.07 % 15.13 % 16.57 % 14.89 % 13.27 %
Net interest margin (FTE) 2.77 % 2.92 % 3.26 % 2.89 % 3.18 %
Efficiency ratio (4) 64.27 % 56.86 % 62.37 % 59.65 % 62.91 %
Net charge-offs (recoveries) to average loans (0.04) % (0.09) % (0.03) % (0.03) % 0.02 %
Allowance for credit losses to ending loans 0.79 % 0.79 % 0.95 % 0.79 % 0.95 %
Non-performing loans to ending loans 0.92 % 0.94 % 1.20 % 0.92 % 1.20 %
Balance Sheet (EOP)
Total loans $ 13,601,846 $ 13,584,828 $ 13,786,479 $ 13,601,846 $ 13,786,479
Total assets 24,453,564 24,018,733 22,960,622 24,453,564 22,960,622
Total deposits 18,569,195 18,196,149 17,037,453 18,569,195 17,037,453
Total borrowed funds 2,575,240 2,536,303 2,676,554 2,575,240 2,676,554
Total shareholders’ equity 3,012,018 3,035,892 2,972,656 3,012,018 2,972,656
Capital Ratios (3)
Risk-based capital ratios (EOP):
Tier 1 common equity 12.04 % 12.08 % 11.75 % 12.04 % 11.75 %
Tier 1 12.04 % 12.08 % 11.75 % 12.04 % 11.75 %
Total 12.77 % 12.84 % 12.69 % 12.77 % 12.69 %
Leverage ratio (to average assets) 8.59 % 8.54 % 8.20 % 8.59 % 8.20 %
Total equity to assets (averages) 12.35 % 12.69 % 12.83 % 12.60 % 13.20 %
Tangible common equity to tangible assets 8.30 % 8.55 % 8.64 % 8.30 % 8.64 %
Nonfinancial Data
Full-time equivalent employees 2,374 2,410 2,445 2,374 2,445
Banking centers 162 162 162 162 162
(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.
December 31, 2021 capital ratios are preliminary.
(4) 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
Income Statement (unaudited)
($ and shares in thousands, except per share data)
Three Months Ended Twelve Months Ended
December 31, September 30, December 31, December 31, December 31,
2021 2021 2020 2021 2020
Interest income $ 156,928 $ 162,026 $ 173,249 $ 638,649 $ 663,308
Less: interest expense 10,147 10,454 12,170 42,249 67,214
Net interest income 146,781 151,572 161,079 596,400 596,094
Provision for credit losses (1,914) (4,613) (1,100) (28,812) 38,395
Net interest income after provision for credit losses 148,695 156,185 162,179 625,212 557,699
Wealth management fees 9,833 10,134 9,259 40,409 36,806
Service charges on deposit accounts 9,121 8,926 8,724 34,685 35,081
Debit card and ATM fees 5,071 4,942 5,072 20,739 20,178
Mortgage banking revenue 7,336 10,870 16,233 42,558 62,775
Investment product fees 6,258 6,475 5,544 24,639 21,614
Capital markets income 6,394 6,017 6,545 21,997 22,480
Company-owned life insurance 2,737 2,355 3,153 10,589 12,031
Other income 4,299 3,589 3,861 14,276 17,542
Gains (losses) on sales of debt securities 435 1,207 161 4,327 10,767
Total noninterest income 51,484 54,515 58,552 214,219 239,274
Salaries and employee benefits 72,336 71,005 78,001 284,098 293,590
Occupancy 13,151 12,757 13,008 54,834 55,316
Equipment 4,473 3,756 3,778 16,704 16,690
Marketing 4,723 3,267 3,242 12,684 10,874
Data processing 11,489 11,508 12,362 47,047 41,086
Communication 2,412 2,372 2,396 10,073 9,731
Professional fees 5,409 3,416 4,834 20,077 15,755
FDIC assessment 1,598 1,628 1,780 6,059 6,722
Amortization of intangibles 2,573 2,779 3,244 11,336 14,091
Amortization of tax credit investments 2,019 1,736 9,871 6,770 18,788
Other expense 11,754 7,050 9,802 30,887 58,774
Total noninterest expense 131,937 121,274 142,318 500,569 541,417
Income before income taxes 68,242 89,426 78,413 338,862 255,556
Income tax expense 12,054 17,680 4,293 61,324 29,147
Net income $ 56,188 $ 71,746 $ 74,120 $ 277,538 $ 226,409
Diluted Earnings Per Share
Net income $ 0.34 $ 0.43 $ 0.44 $ 1.67 $ 1.36
Average Common Shares Outstanding
Basic 165,278 165,258 164,799 165,178 165,509
Diluted 166,128 165,939 165,631 165,929 166,177
Common shares outstanding at end of period 165,838 165,814 165,367 165,838 165,367
Balance Sheet (unaudited)
($ in thousands)
December 31, September 30, December 31,
2021 2021 2020
Assets
Federal Reserve Bank account $ 627,354 $ 600,581 $ 307,967
Money market investments 22,002 16,294 13,537
Investments:
Treasury and government-sponsored agencies 1,778,357 1,803,273 852,196
Mortgage-backed securities 3,698,831 3,354,701 3,339,098
States and political subdivisions 1,654,986 1,609,283 1,492,162
Other securities 432,478 442,503 458,639
Total investments 7,564,652 7,209,760 6,142,095
Loans held for sale, at fair value 35,458 51,306 63,250
Loans:
Commercial 3,391,769 3,505,183 3,956,422
Commercial and agriculture real estate 6,380,674 6,290,632 5,946,512
Consumer:
Home equity 560,590 554,322 556,414
Other consumer loans 1,013,524 1,009,909 1,078,709
Subtotal of commercial and consumer loans 11,346,557 11,360,046 11,538,057
Residential real estate 2,255,289 2,224,782 2,248,422
Total loans 13,601,846 13,584,828 13,786,479
Total earning assets 21,851,312 21,462,769 20,313,328
Allowance for credit losses (107,341) (107,868) (131,388)
Non-earning Assets:
Cash and due from banks 172,663 180,583 268,208
Premises and equipment, net 476,186 476,036 464,408
Operating lease right-of-use assets 69,560 69,912 76,197
Goodwill and other intangible assets 1,071,672 1,074,245 1,083,008
Company-owned life insurance 463,324 461,310 456,110
Other assets 456,188 401,746 430,751
Total non-earning assets 2,709,593 2,663,832 2,778,682
Total assets $ 24,453,564 $ 24,018,733 $ 22,960,622
Liabilities and Equity
Noninterest-bearing demand deposits $ 6,303,106 $ 6,440,526 $ 5,633,672
Interest-bearing:
Checking and NOW accounts 5,338,022 4,956,012 4,877,046
Savings accounts 3,798,494 3,708,807 3,395,747
Money market accounts 2,169,160 2,097,967 1,908,118
Other time deposits 960,413 992,837 1,103,313
Total core deposits 18,569,195 18,196,149 16,917,896
Brokered deposits 119,557
Total deposits 18,569,195 18,196,149 17,037,453
Federal funds purchased and interbank borrowings 276 34 1,166
Securities sold under agreements to repurchase 392,275 375,247 431,166
Federal Home Loan Bank advances 1,886,019 1,890,054 1,991,435
Other borrowings 296,670 270,968 252,787
Total borrowed funds 2,575,240 2,536,303 2,676,554
Operating lease liabilities 76,236 76,771 86,598
Accrued expenses and other liabilities 220,875 173,618 187,361
Total liabilities 21,441,546 20,982,841 19,987,966
Common stock, surplus, and retained earnings 3,014,393 2,979,082 2,824,885
Accumulated other comprehensive income (loss), net of tax (2,375) 56,810 147,771
Total shareholders’ equity 3,012,018 3,035,892 2,972,656
Total liabilities and shareholders’ equity $ 24,453,564 $ 24,018,733 $ 22,960,622
Average Balance Sheet and Interest Rates (unaudited)
($ in thousands)
Three Months Ended Three Months Ended Three Months Ended
December 31, 2021 September 30, 2021 December 31, 2020
Average Income (1)/ Yield/ Average Income (1)/ Yield/ Average Income (1)/ Yield/
Earning Assets: Balance Expense Rate Balance Expense Rate Balance Expense Rate
Money market and other interest-earning
investments $ 726,144 $ 276 0.15 % $ 467,572 $ 177 0.15 % $ 413,782 $ 126 0.12 %
Investments:
Treasury and government-sponsored agencies 1,763,544 6,390 1.45 % 1,730,553 6,968 1.61 % 648,314 2,937 1.81 %
Mortgage-backed securities 3,513,482 15,071 1.72 % 3,313,027 14,509 1.75 % 3,291,436 16,137 1.96 %
States and political subdivisions 1,625,390 12,941 3.18 % 1,586,743 12,609 3.18 % 1,437,890 12,008 3.34 %
Other securities 438,583 2,608 2.38 % 443,393 2,638 2.38 % 462,836 2,629 2.27 %
Total investments 7,340,999 37,010 2.02 % 7,073,716 36,724 2.08 % 5,840,476 33,711 2.31 %
Loans: (2)
Commercial 3,420,274 31,641 3.62 % 3,645,197 36,139 3.88 % 4,132,831 46,468 4.40 %
Commercial and agriculture real estate 6,341,296 57,347 3.54 % 6,200,144 57,820 3.65 % 5,829,912 58,334 3.92 %
Consumer:
Home equity 556,851 4,380 3.12 % 549,229 4,448 3.21 % 550,548 4,380 3.17 %
Other consumer loans 1,009,690 9,488 3.73 % 1,018,385 9,690 3.77 % 1,099,504 11,276 4.08 %
Subtotal commercial and consumer loans 11,328,111 102,856 3.60 % 11,412,955 108,097 3.76 % 11,612,795 120,458 4.13 %
Residential real estate loans 2,275,469 20,228 3.56 % 2,274,347 20,529 3.61 % 2,314,938 22,471 3.88 %
Total loans 13,603,580 123,084 3.56 % 13,687,302 128,626 3.70 % 13,927,733 142,929 4.04 %
Total earning assets $ 21,670,723 $ 160,370 2.93 % $ 21,228,590 $ 165,527 3.08 % $ 20,181,991 $ 176,766 3.46 %
Less: Allowance for credit losses (107,990) (111,216) (137,539)
Non-earning Assets:
Cash and due from banks $ 228,126 $ 272,855 $ 341,154
Other assets 2,481,792 2,479,079 2,479,253
Total assets $ 24,272,651 $ 23,869,308 $ 22,864,859
Interest-Bearing Liabilities:
Checking and NOW accounts $ 5,093,496 $ 458 0.04 % $ 4,873,914 $ 484 0.04 % $ 4,708,568 $ 629 0.05 %
Savings accounts 3,766,543 524 0.06 % 3,678,944 500 0.05 % 3,329,494 487 0.06 %
Money market accounts 2,139,702 456 0.08 % 2,110,981 438 0.08 % 1,932,594 445 0.09 %
Other time deposits 978,723 1,047 0.42 % 998,060 1,156 0.46 % 1,158,715 2,189 0.75 %
Total interest-bearing core deposits 11,978,464 2,485 0.08 % 11,661,899 2,578 0.09 % 11,129,371 3,750 0.13 %
Brokered deposits 0.00 % 0.00 % 37,176 26 0.28 %
Total interest-bearing deposits 11,978,464 2,485 0.08 % 11,661,899 2,578 0.09 % 11,166,547 3,776 0.13 %
Federal funds purchased and interbank borrowings 1,162 0.00 % 689 0.00 % 843 0.03 %
Securities sold under agreements to repurchase 381,744 92 0.10 % 384,724 90 0.09 % 438,272 125 0.11 %
Federal Home Loan Bank advances 1,887,821 5,122 1.08 % 1,890,916 5,326 1.12 % 2,089,519 5,953 1.13 %
Other borrowings 274,926 2,448 3.56 % 270,597 2,460 3.64 % 240,815 2,316 3.85 %
Total borrowed funds 2,545,653 7,662 1.19 % 2,546,926 7,876 1.23 % 2,769,449 8,394 1.21 %
Total interest-bearing liabilities $ 14,524,117 $ 10,147 0.28 % $ 14,208,825 $ 10,454 0.29 % $ 13,935,996 $ 12,170 0.35 %
Noninterest-Bearing Liabilities and Shareholders’ Equity
Demand deposits $ 6,435,829 $ 6,314,100 $ 5,644,017
Other liabilities 313,880 318,448 352,256
Shareholders’ equity 2,998,825 3,027,935 2,932,590
Total liabilities and shareholders’ equity $ 24,272,651 $ 23,869,308 $ 22,864,859
Net interest rate spread 2.65 % 2.79 % 3.11 %
Net interest margin (FTE) 2.77 % 2.92 % 3.26 %
FTE adjustment $ 3,442 $ 3,501 $ 3,517
(1) Interest income is reflected on a fully taxable equivalent basis (FTE).
(2) Includes loans held for sale.
Average Balance Sheet and Interest Rates (unaudited)
($ in thousands)
Twelve Months Ended Twelve Months Ended
December 31, 2021 December 31, 2020
Average Income (1)/ Yield/ Average Income (1)/ Yield/
Earning Assets: Balance Expense Rate Balance Expense Rate
Money market and other interest-earning
investments $ 450,158 $ 589 0.13 % $ 174,494 $ 568 0.33 %
Investments:
Treasury and government-sponsored agencies 1,573,855 24,209 1.54 % 547,054 12,124 2.22 %
Mortgage-backed securities 3,356,950 60,479 1.80 % 3,246,520 70,611 2.17 %
States and political subdivisions 1,548,939 50,115 3.24 % 1,347,490 47,034 3.49 %
Other securities 443,606 10,680 2.41 % 485,430 11,990 2.47 %
Total investments $ 6,923,350 $ 145,483 2.10 % $ 5,626,494 $ 141,759 2.52 %
Loans: (2)
Commercial 3,763,099 138,063 3.67 % 3,843,089 140,473 3.66 %
Commercial and agriculture real estate 6,168,146 228,568 3.71 % 5,477,562 234,670 4.28 %
Consumer:
Home equity 547,322 17,181 3.14 % 553,570 18,561 3.35 %
Other consumer loans 1,030,145 39,100 3.80 % 1,131,028 46,661 4.13 %
Subtotal commercial and consumer loans 11,508,712 422,912 3.67 % 11,005,249 440,365 4.00 %
Residential real estate loans 2,269,989 83,578 3.68 % 2,352,444 94,202 4.00 %
Total loans 13,778,701 506,490 3.68 % 13,357,693 534,567 4.00 %
Total earning assets $ 21,152,209 $ 652,562 3.09 % $ 19,158,681 $ 676,894 3.53 %
Less: Allowance for credit losses (117,436) (115,321)
Non-earning Assets:
Cash and due from banks $ 256,860 $ 327,053
Other assets 2,492,054 2,414,602
Total assets $ 23,783,687 $ 21,785,015
Interest-Bearing Liabilities:
Checking and NOW accounts $ 4,945,435 $ 2,065 0.04 % $ 4,464,027 $ 5,449 0.12 %
Savings accounts 3,648,019 2,003 0.05 % 3,113,435 3,156 0.10 %
Money market accounts 2,080,332 1,750 0.08 % 1,866,196 4,585 0.25 %
Other time deposits 1,020,359 5,105 0.50 % 1,337,269 14,013 1.05 %
Total interest-bearing core deposits 11,694,145 10,923 0.09 % 10,780,927 27,203 0.25 %
Brokered deposits 41,371 31 0.08 % 85,041 966 1.14 %
Total interest-bearing deposits 11,735,516 10,954 0.09 % 10,865,968 28,169 0.26 %
Federal funds purchased and interbank borrowings 1,113 0.00 % 138,257 1,296 0.94 %
Securities sold under agreements to repurchase 392,777 397 0.10 % 375,961 854 0.23 %
Federal Home Loan Bank advances 1,902,407 21,075 1.11 % 2,055,155 27,274 1.33 %
Other borrowings 269,484 9,823 3.65 % 242,642 9,621 3.96 %
Total borrowed funds 2,565,781 31,295 1.22 % 2,812,015 39,045 1.39 %
Total interest-bearing liabilities 14,301,297 42,249 0.30 % 13,677,983 67,214 0.49 %
Noninterest-Bearing Liabilities and Shareholders’ Equity
Demand deposits $ 6,163,937 $ 4,945,506
Other liabilities 320,933 286,066
Shareholders’ equity 2,997,520 2,875,460
Total liabilities and shareholders’ equity $ 23,783,687 $ 21,785,015
Net interest rate spread 2.79 % 3.04 %
Net interest margin (FTE) 2.89 % 3.18 %
FTE adjustment $ 13,913 $ 13,586
(1) Interest income is reflected on a fully taxable equivalent basis (FTE).
(2) Includes loans held for sale.
Asset Quality (EOP) (unaudited)
($ in thousands)
Three Months Ended Twelve Months Ended
December 31, September 30, December 31, December 31, December 31,
2021 2021 2020 2021 2020
Beginning allowance for credit losses $ 107,868 $ 109,444 $ 131,388 $ 131,388 $ 54,619
Impact of adopting ASC 326 on 01/01/2020 41,347
Provision for credit losses (1,914) (4,613) (1,100) (28,812) 38,395
Gross charge-offs (545) (1,215) (707) (4,310) (15,553)
Gross recoveries 1,932 4,252 1,807 9,075 12,580
Net (charge-offs) recoveries 1,387 3,037 1,100 4,765 (2,973)
Ending allowance for credit losses $ 107,341 $ 107,868 $ 131,388 $ 107,341 $ 131,388
Net charge-offs (recoveries) / average loans (1) (0.04) % (0.09) % (0.03) % (0.03) % 0.02 %
Average loans outstanding (1) $ 13,594,543 $ 13,675,436 $ 13,910,145 $ 13,766,590 $ 13,341,677
EOP loans outstanding (1) 13,601,846 13,584,828 13,786,479 13,601,846 13,786,479
Allowance for credit losses / EOP loans (1) 0.79 % 0.79 % 0.95 % 0.79 % 0.95 %
Underperforming Assets:
Loans 90 Days and over (still accruing) $ 7 $ 113 $ 167 $ 7 $ 167
Non-performing loans:
Nonaccrual loans (2) 106,691 111,586 147,339 106,691 147,339
TDRs still accruing 18,378 16,420 17,749 18,378 17,749
Total non-performing loans 125,069 128,006 165,088 125,069 165,088
Foreclosed properties 2,030 1,943 1,324 2,030 1,324
Total underperforming assets $ 127,106 $ 130,062 $ 166,579 $ 127,106 $ 166,579
Classified and Criticized Assets:
Nonaccrual loans (2) 106,691 111,586 147,339 106,691 147,339
Substandard accruing loans 162,572 164,192 157,276 162,572 157,276
Loans 90 days and over (still accruing) 7 113 167 7 167
Total classified loans – “problem loans” $ 269,270 $ 275,891 $ 304,782 $ 269,270 $ 304,782
Other classified assets 4,338 4,300 3,706 4,338 3,706
Criticized loans – “special mention loans” 235,910 240,215 287,192 235,910 287,192
Total classified and criticized assets $ 509,518 $ 520,406 $ 595,680 $ 509,518 $ 595,680
Non-performing loans / EOP loans (1) 0.92 % 0.94 % 1.20 % 0.92 % 1.20 %
Allowance to non-performing loans 86 % 84 % 80 % 86 % 80 %
Under-performing assets / EOP loans (1) 0.93 % 0.96 % 1.21 % 0.93 % 1.21 %
EOP total assets $ 24,453,564 $ 24,018,733 $ 22,960,622 $ 24,453,564 $ 22,960,622
Under-performing assets / EOP assets 0.52 % 0.54 % 0.73 % 0.52 % 0.73 %
EOP – End of period actual balances
(1) Excludes loans held for sale.
(2) Includes non-accruing TDRs totaling $11.7 million at December 31, 2021, $12.8 million at September 30, 2021, and $14.9 million at December 30, 2020.
Non-GAAP Measures (unaudited)
($ in thousands)
Three Months Ended Twelve Months Ended
December 31, September 30, December 31, December 31, December 31,
2021 2021 2020 2021 2020
Actual End of Period Balances
GAAP shareholders’ equity $ 3,012,018 $ 3,035,892 $ 2,972,656 $ 3,012,018 $ 2,972,656
Deduct:
Goodwill 1,036,994 1,036,994 1,036,994 1,036,994 1,036,994
Intangibles 34,678 37,251 46,014 34,678 46,014
1,071,672 1,074,245 1,083,008 1,071,672 1,083,008
Tangible shareholders’ equity $ 1,940,346 $ 1,961,647 $ 1,889,648 $ 1,940,346 $ 1,889,648
Average Balances
GAAP shareholders’ equity $ 2,998,825 $ 3,027,935 $ 2,932,590 $ 2,997,520 $ 2,875,460
Deduct:
Goodwill 1,036,994 1,036,994 1,036,994 1,036,994 1,036,994
Intangibles 35,992 38,585 47,536 40,071 52,740
1,072,986 1,075,579 1,084,530 1,077,065 1,089,734
Average tangible shareholders’ equity $ 1,925,839 $ 1,952,356 $ 1,848,060 $ 1,920,455 $ 1,785,726
Actual End of Period Balances
GAAP assets $ 24,453,564 $ 24,018,733 $ 22,960,622 $ 24,453,564 $ 22,960,622
Add:
Trust overdrafts 116 26 26
Deduct:
Goodwill 1,036,994 1,036,994 1,036,994 1,036,994 1,036,994
Intangibles 34,678 37,251 46,014 34,678 46,014
1,071,672 1,074,245 1,083,008 1,071,672 1,083,008
Tangible assets $ 23,381,892 $ 22,944,604 $ 21,877,640 $ 23,381,892 $ 21,877,640
Risk-weighted assets (2) $ 16,588,469 $ 16,227,070 $ 15,369,076 $ 16,588,469 $ 15,369,076
GAAP net income $ 56,188 $ 71,746 $ 74,120 $ 277,538 $ 226,409
Add:
Amortization of intangibles (net of tax) 1,930 2,084 2,433 8,502 10,585
Tangible net income $ 58,118 $ 73,830 $ 76,553 $ 286,040 $ 236,994
Tangible Ratios
Return on tangible common equity 11.98 % 15.05 % 16.20 % 14.74 % 12.54 %
Return on average tangible common equity 12.07 % 15.13 % 16.57 % 14.89 % 13.27 %
Return on tangible assets 0.99 % 1.29 % 1.40 % 1.22 % 1.08 %
Tangible common equity to tangible assets 8.30 % 8.55 % 8.64 % 8.30 % 8.64 %
Tangible common equity to risk-weighted assets (2) 11.70 % 12.09 % 12.30 % 11.70 % 12.30 %
Tangible common book value (1) 11.70 11.83 11.43 11.70 11.43
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 common equity (2) $ 1,998,056 $ 1,960,340 $ 1,805,194 $ 1,998,056 $ 1,805,194
Risk-weighted assets (2) 16,588,469 16,227,070 15,369,076 16,588,469 15,369,076
Tier 1 common equity to risk-weighted assets (2) 12.04 % 12.08 % 11.75 % 12.04 % 11.75 %
(2) December 31, 2021 figures are preliminary.

Disclaimer

Old National Bancorp published this content on 18 January 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 18 January 2022 13:04:03 UTC.

Publicnow 2022

All news about OLD NATIONAL BANCORP

Analyst Recommendations on OLD NATIONAL BANCORP
Sales 2021 825 M

Net income 2021 284 M

Net Debt 2021

P/E ratio 2021 11,6x
Yield 2021 2,82%
Capitalization 3 291 M
3 291 M
Capi. / Sales 2021 3,99x
Capi. / Sales 2022 2,33x
Nbr of Employees 2 374
Free-Float 98,7%

Chart OLD NATIONAL BANCORP

Duration :


Period :

Old National Bancorp Technical Analysis Chart | MarketScreener

Technical analysis trends OLD NATIONAL BANCORP

Short Term Mid-Term Long Term
Trends Bullish Bullish Neutral

Income Statement Evolution

Sell

Buy

Mean consensus OUTPERFORM
Number of Analysts 7
Last Close Price
19,85 $
Average target price
22,08 $
Spread / Average Target 11,3%



Share.

About Author

Comments are closed.