FHB First Hawaiian Inc

First Hawaiian, Inc. (NASDAQ:FHB), (“First Hawaiian” or the “Company”) today reported financial results for its quarter ended December 31, 2023.

“I’m happy to report that we finished 2023 with a strong fourth quarter. Our loan balances were stable, we grew consumer and commercial deposits, and credit quality remained excellent,” said Bob Harrison, Chairman, President, and CEO. “During the fourth quarter we also took action to strengthen our balance sheet and increase our future earnings power by selling low-yielding securities. We intend to use the proceeds to reduce high-cost deposits which will increase our net interest margin and net interest income in 2024.”

On January 24, 2024, the Company’s Board of Directors declared a quarterly cash dividend of $0.26 per share. The dividend will be payable on March 1, 2024, to stockholders of record at the close of business on February 16, 2024.  

Additionally, the Company’s Board of Directors adopted a stock repurchase program for up to $40 million of its outstanding common stock during 2024.

Fourth Quarter 2023 Highlights:

• Net income of $47.5 million, or $0.37 per diluted share
• Total loans and leases increased $21.2 million versus prior quarter
• Total deposits decreased $178.8 million versus prior quarter
• Net interest margin decreased 5 basis points to 2.81%
• Recorded a $5.3 million provision for credit losses
• Sold $525.6 million of low-yielding investment securities and recognized a $40.0 million loss
• Sold 120,104 shares of Visa Class B stock for a gain of $40.8 million
• $16.3 million FDIC special assessment included in expenses
• Board of Directors declared a quarterly dividend of $0.26 per share

Balance Sheet

Total assets were $24.9 billion at December 31, 2023 and September 30, 2023.

Gross loans and leases were $14.4 billion as of December 31, 2023, an increase of $21.2 million, or 0.1%, from $14.3 billion as of September 30, 2023.

Total deposits were $21.3 billion as of December 31, 2023, a decrease of $178.8 million, or 0.8%, from $21.5 billion as of September 30, 2023.

Net Interest Income

Net interest income for the fourth quarter of 2023 was $151.8 million, a decrease of $5.4 million, or 3.4%, compared to $157.1 million for the prior quarter.  

The net interest margin was 2.81% in the fourth quarter of 2023, a decrease of 5 basis points compared to 2.86% in the prior quarter.

Provision Expense

During the quarter ended December 31, 2023, we recorded a $5.3 million provision for credit losses. In the quarter ended September 30, 2023, we recorded a $7.5 million provision for credit losses.

Noninterest Income

Noninterest income was $58.3 million in the fourth quarter of 2023, an increase of $12.3 million compared to noninterest income of $46.1 million in the prior quarter.

Noninterest Expense

Noninterest expense was $142.3 million in the fourth quarter of 2023, an increase of $22.9 million compared to noninterest expense of $119.4 million in the prior quarter.

The efficiency ratio was 67.3% and 58.3% for the quarters ended December 31, 2023 and September 30, 2023, respectively.

Taxes

The effective tax rate was 24.0% and 23.8% for the quarters ended December 31, 2023 and September 30, 2023, respectively.

Asset Quality

The allowance for credit losses was $156.5 million, or 1.09% of total loans and leases, as of December 31, 2023, compared to $154.8 million, or 1.08% of total loans and leases, as of September 30, 2023. The reserve for unfunded commitments was $35.6 million as of December 31, 2023 compared to $37.8 million as of September 30, 2023. Net charge-offs were $5.8 million, or 0.16% of average loans and leases on an annualized basis, for the quarter ended December 31, 2023, compared to net recoveries of $0.3 million, or 0.01% of average loans and leases on an annualized basis, for the quarter ended September 30, 2023. Total non-performing assets were $18.6 million, or 0.13% of total loans and leases and other real estate owned, on December 31, 2023, compared to total non-performing assets of $14.6 million, or 0.10% of total loans and leases and other real estate owned, on September 30, 2023.

Capital

Total stockholders' equity was $2.5 billion on December 31, 2023 an increase of $135.1 million from $2.4 billion as of September 30, 2023.

The tier 1 leverage, common equity tier 1 and total capital ratios were 8.64%, 12.39% and 13.57%, respectively, on December 31, 2023, compared with 8.45%, 12.21% and 13.38%, respectively, on September 30, 2023.

The Company did not repurchase any shares in the fourth quarter.

As to the stock repurchase program approved for 2024, repurchases of shares of the Company’s common stock may be conducted through open-market purchases, which may include purchases under a trading plan adopted pursuant to Securities and Exchange Commission Rule 10b5-1, or through privately negotiated transactions. The timing and exact amount of share repurchases, if any, will be subject to management’s discretion and various factors, including the Company’s capital position and financial performance, as well as market conditions. The repurchase program may be suspended, terminated or modified at any time for any reason.

First Hawaiian, Inc.

First Hawaiian, Inc. (NASDAQ:FHB) is a bank holding company headquartered in Honolulu, Hawaii. Its principal subsidiary, First Hawaiian Bank, founded in 1858 under the name Bishop & Company, is Hawaii’s oldest and largest financial institution with branch locations throughout Hawaii, Guam and Saipan. The company offers a comprehensive suite of banking services to consumer and commercial customers including deposit products, loans, wealth management, insurance, trust, retirement planning, credit card and merchant processing services. Customers may also access their accounts through ATMs, online and mobile banking channels. For more information about First Hawaiian, Inc., visit the Company’s website, www.fhb.com.

Conference Call Information

First Hawaiian will host a conference call to discuss the Company’s results today at 1:00 p.m. Eastern Time, 8:00 a.m. Hawaii Time.

To access the call by phone, please register via the following link: https://register.vevent.com/register/BIb0fdeb3d43a84da4acc2b0efeb9ba356, and you will be provided with dial in details. To avoid delays, we encourage participants to dial into the conference call fifteen minutes ahead of the scheduled start time.

A live webcast of the conference call, including a slide presentation, will be available at the following link: www.fhb.com/earnings. The archive of the webcast will be available at the same location.

Forward-Looking StatementsThis press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. These statements are often, but not always, made through the use of words or phrases such as “may”, “might”, “should”, “could”, “predict”, “potential”, “believe”, “expect”, “continue”, “will”, “anticipate”, “seek”, “estimate”, “intend”, “plan”, “projection”, “would”, “annualized” and “outlook”, or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management's beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, estimates and uncertainties that are difficult to predict. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, there can be no assurance that actual results will not prove to be materially different from the results expressed or implied by the forward-looking statements. A number of important factors could cause actual results or performance to differ materially from the forward-looking statements, including (without limitation) the risks and uncertainties associated with the domestic and global economic environment and capital market conditions and other risk factors. For a discussion of some of these risks and important factors that could affect our future results and financial condition, see our U.S. Securities and Exchange Commission (“SEC”) filings, including, but not limited to, our Annual Report on Form 10-K for the year ended December 31, 2022 and our Quarterly Report on Form 10-Q for the quarters ended March 31, 2023, June 30, 2023 and September 30, 2023.

Use of Non-GAAP Financial MeasuresReturn on average tangible assets, return on average tangible stockholders’ equity, tangible book value per share and tangible stockholders’ equity to tangible assets are non-GAAP financial measures. We believe that these measurements are useful for investors, regulators, management and others to evaluate financial performance and capital adequacy relative to other financial institutions. Although these non-GAAP financial measures are frequently used by stakeholders in the evaluation of a company, they have limitations as analytical tools and should not be considered in isolation or as a substitute for analysis of our results or financial condition as reported under GAAP. Investors should consider our performance and capital adequacy as reported under GAAP and all other relevant information when assessing our performance and capital adequacy.

Table 14 at the end of this document provides a reconciliation of these non-GAAP financial measures with their most directly comparable GAAP measures.

Investor Relations Contact: Kevin Haseyama, CFA(808) 525-6268khaseyama@fhb.com

Media Contact:Lindsay Chambers(808) 525-6254lchambers@fhb.com

Financial Highlights		Table 1
		For the Three Months Ended									For the Year Ended
		December 31,			September 30,			December 31,			December 31,
(dollars in thousands, except per share data)		2023			2023			2022			2023			2022
Operating Results:
Net interest income		$	151,793		$	157,148		$	171,794		$	636,127		$	613,549
Provision for credit losses			5,330			7,500			2,956			26,630			1,392
Noninterest income			58,347			46,097			48,151			200,815			179,525
Noninterest expense			142,307			119,383			113,922			501,138			440,471
Net income			47,502			58,221			79,588			234,983			265,685
Basic earnings per share			0.37			0.46			0.62			1.84			2.08
Diluted earnings per share			0.37			0.46			0.62			1.84			2.08
Dividends declared per share			0.26			0.26			0.26			1.04			1.04
Dividend payout ratio			70.27	%		56.52	%		41.94	%		56.52	%		50.00	%
Performance Ratios(1):
Net interest margin			2.81	%		2.86	%		3.15	%		2.92	%		2.78	%
Efficiency ratio			67.28	%		58.31	%		51.47	%		59.48	%		55.20	%
Return on average total assets			0.77	%		0.93	%		1.28	%		0.95	%		1.06	%
Return on average tangible assets (non-GAAP)(2)			0.81	%		0.97	%		1.34	%		0.99	%		1.11	%
Return on average total stockholders' equity			7.94	%		9.76	%		14.27	%		10.01	%		11.44	%
Return on average tangible stockholders' equity (non-GAAP)(2)			13.66	%		16.84	%		25.93	%		17.39	%		20.03	%
Average Balances:
Average loans and leases		$	14,349,322		$	14,349,402		$	13,876,136		$	14,266,291		$	13,314,821
Average earning assets			21,688,816			22,060,480			21,856,135			21,952,009			22,272,795
Average assets			24,404,727			24,727,893			24,575,648			24,625,445			24,964,422
Average deposits			20,908,221			21,212,102			21,725,177			21,160,155			22,058,497
Average stockholders' equity			2,374,669			2,367,422			2,213,030			2,346,713			2,321,606
Market Value Per Share:
Closing			22.86			18.05			26.04			22.86			26.04
High			23.22			22.59			27.16			28.28			31.16
Low			17.18			17.41			24.06			15.08			21.21

		As of			As of			As of
		December 31,			September 30,			December 31,
(dollars in thousands, except per share data)		2023			2023			2022
Balance Sheet Data:
Loans and leases		$	14,353,497		$	14,332,335		$	14,092,012
Total assets			24,926,474			24,912,524			24,577,223
Total deposits			21,332,657			21,511,489			21,689,029
Short-term borrowings			500,000			500,000			75,000
Total stockholders' equity			2,486,066			2,351,009			2,269,005
Per Share of Common Stock:
Book value		$	19.48		$	18.42		$	17.82
Tangible book value (non-GAAP)(2)			11.68			10.62			10.00
Asset Quality Ratios:
Non-accrual loans and leases / total loans and leases			0.13	%		0.10	%		0.08	%
Allowance for credit losses for loans and leases / total loans and leases			1.09	%		1.08	%		1.02	%
Capital Ratios:
Common Equity Tier 1 Capital Ratio			12.39	%		12.21	%		11.82	%
Tier 1 Capital Ratio			12.39	%		12.21	%		11.82	%
Total Capital Ratio			13.57	%		13.38	%		12.92	%
Tier 1 Leverage Ratio			8.64	%		8.45	%		8.11	%
Total stockholders' equity to total assets			9.97	%		9.44	%		9.23	%
Tangible stockholders' equity to tangible assets (non-GAAP)(2)			6.23	%		5.67	%		5.40	%
Non-Financial Data:
Number of branches			50			50			51
Number of ATMs			275			294			294
Number of Full-Time Equivalent Employees			2,089			2,087			2,063

                                                           

(1)   Except for the efficiency ratio, amounts are annualized for the three months ended December 31, 2023, September 30, 2023 and December 31, 2022.

(2)   Return on average tangible assets, return on average tangible stockholders’ equity, tangible book value per share and tangible stockholders’ equity to tangible assets are non-GAAP financial measures. We compute our return on average tangible assets as the ratio of net income to average tangible assets, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total assets. We compute our return on average tangible stockholders’ equity as the ratio of net income to average tangible stockholders’ equity, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total stockholders’ equity. We compute our tangible book value per share as the ratio of tangible stockholders’ equity to outstanding shares. Tangible stockholders’ equity is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our total stockholders’ equity. We compute our tangible stockholders’ equity to tangible assets as the ratio of tangible stockholders’ equity to tangible assets, each of which we calculate by subtracting (and thereby effectively excluding) the value of our goodwill. For a reconciliation to the most directly comparable GAAP financial measure, see Table 14, GAAP to Non-GAAP Reconciliation.

Consolidated Statements of Income		Table 2
		For the Three Months Ended									For the Year Ended
		December 31,			September 30,			December 31,			December 31,
(dollars in thousands, except per share amounts)		2023			2023			2022			2023			2022
Interest income
Loans and lease financing		$	196,276		$	194,098		$	159,526		$	748,053		$	509,820
Available-for-sale investment securities			19,033			18,426			18,714			74,241			87,108
Held-to-maturity investment securities			17,987			18,271			19,137			73,497			55,376
Other			7,734			9,004			3,088			27,788			10,916
Total interest income			241,030			239,799			200,465			923,579			663,220
Interest expense
Deposits			82,215			74,651			28,202			258,221			49,201
Short-term and long-term borrowings			6,232			6,838			469			26,289			470
Other			790			1,162			—			2,942			—
Total interest expense			89,237			82,651			28,671			287,452			49,671
Net interest income			151,793			157,148			171,794			636,127			613,549
Provision for credit losses			5,330			7,500			2,956			26,630			1,392
Net interest income after provision for credit losses			146,463			149,648			168,838			609,497			612,157
Noninterest income
Service charges on deposit accounts			7,646			7,524			7,376			29,647			28,809
Credit and debit card fees			16,381			15,748			16,376			63,888			66,028
Other service charges and fees			9,535			9,546			9,185			37,299			37,036
Trust and investment services income			9,645			9,742			9,023			38,449			36,465
Bank-owned life insurance			5,063			1,872			2,865			15,326			1,248
Investment securities gains, net			792			—			—			792			—
Other			9,285			1,665			3,326			15,414			9,939
Total noninterest income			58,347			46,097			48,151			200,815			179,525
Noninterest expense
Salaries and employee benefits			55,882			55,937			49,629			225,755			199,129
Contracted services and professional fees			16,219			16,393			17,638			66,423			70,027
Occupancy			7,561			6,711			8,175			29,608			31,034
Equipment			12,547			11,826			9,984			45,109			34,506
Regulatory assessment and fees			20,412			4,149			2,591			32,073			9,603
Advertising and marketing			1,441			2,289			2,072			7,615			7,996
Card rewards program			7,503			8,358			8,681			31,627			30,990
Other			20,742			13,720			15,152			62,928			57,186
Total noninterest expense			142,307			119,383			113,922			501,138			440,471
Income before provision for income taxes			62,503			76,362			103,067			309,174			351,211
Provision for income taxes			15,001			18,141			23,479			74,191			85,526
Net income		$	47,502		$	58,221		$	79,588		$	234,983		$	265,685
Basic earnings per share		$	0.37		$	0.46		$	0.62		$	1.84		$	2.08
Diluted earnings per share		$	0.37		$	0.46		$	0.62		$	1.84		$	2.08
Basic weighted-average outstanding shares			127,612,734			127,609,860			127,356,795			127,567,547			127,489,889
Diluted weighted-average outstanding shares			128,028,964			127,936,440			127,894,773			127,915,873			127,981,699

Consolidated Balance Sheets		Table 3
		December 31,				September 30,				December 31,
(dollars in thousands, except share amount)		2023				2023				2022
Assets
Cash and due from banks		$	185,015			$	246,028			$	297,502
Interest-bearing deposits in other banks			1,554,882				967,400				229,122
Investment securities:
Available-for-sale, at fair value (amortized cost: $2,558,675 as of December 31, 2023, $3,172,031 as of September 30, 2023 and $3,549,599 as of December 31, 2022)			2,255,336				2,722,704				3,151,133
Held-to-maturity, at amortized cost (fair value: $3,574,856 as of December 31, 2023, $3,433,029 as of September 30, 2023 and $3,814,822 as of December 31, 2022)			4,041,449				4,104,114				4,320,639
Loans held for sale			190				—				—
Loans and leases			14,353,497				14,332,335				14,092,012
Less: allowance for credit losses			156,533				154,795				143,900
Net loans and leases			14,196,964				14,177,540				13,948,112
Premises and equipment, net			281,461				277,805				280,355
Other real estate owned and repossessed personal property			—				—				91
Accrued interest receivable			84,417				84,327				78,194
Bank-owned life insurance			479,907				477,698				473,067
Goodwill			995,492				995,492				995,492
Mortgage servicing rights			5,699				5,855				6,562
Other assets			845,662				853,561				796,954
Total assets		$	24,926,474			$	24,912,524			$	24,577,223
Liabilities and Stockholders' Equity
Deposits:
Interest-bearing		$	13,749,095			$	13,612,493			$	12,824,383
Noninterest-bearing			7,583,562				7,898,996				8,864,646
Total deposits			21,332,657				21,511,489				21,689,029
Short-term borrowings			500,000				500,000				75,000
Retirement benefits payable			103,285				99,685				102,577
Other liabilities			504,466				450,341				441,612
Total liabilities			22,440,408				22,561,515				22,308,218
Stockholders' equity
Common stock ($0.01 par value; authorized 300,000,000 shares; issued/outstanding: 141,340,539 / 127,618,761 shares as of December 31, 2023, issued/outstanding: 141,330,663 / 127,609,934 shares as of September 30, 2023 and issued/outstanding: 140,963,918 / 127,363,327 shares as of December 31, 2022)			1,413				1,413				1,410
Additional paid-in capital			2,548,250				2,545,659				2,538,336
Retained earnings			837,859				823,895				736,544
Accumulated other comprehensive loss, net			(530,210	)			(648,731	)			(639,254	)
Treasury stock (13,721,778 shares as of December 31, 2023, 13,720,729 shares as of September 30, 2023 and 13,600,591 shares as of December 31, 2022)			(371,246	)			(371,227	)			(368,031	)
Total stockholders' equity			2,486,066				2,351,009				2,269,005
Total liabilities and stockholders' equity		$	24,926,474			$	24,912,524			$	24,577,223

Average Balances and Interest Rates																								Table 4
		Three Months Ended								Three Months Ended								Three Months Ended
		December 31, 2023								September 30, 2023								December 31, 2022
		Average			Income/			Yield/		Average			Income/			Yield/		Average			Income/			Yield/
(dollars in millions)		Balance			Expense			Rate		Balance			Expense			Rate		Balance			Expense			Rate
Earning Assets
Interest-Bearing Deposits in Other Banks		$	568.0		$	7.8		5.39	%	$	608.6		$	8.2		5.36	%	$	321.3		$	2.9		3.64	%
Available-for-Sale Investment Securities
Taxable			2,598.4			19.0		2.92			2,834.6			18.4		2.59			3,180.8			18.3		2.30
Non-Taxable			1.9			—		5.12			2.3			—		5.48			37.9			0.5		5.42
Held-to-Maturity Investment Securities
Taxable			3,472.1			14.8		1.70			3,544.1			15.0		1.70			3,754.9			15.8		1.69
Non-Taxable			603.9			3.9		2.58			604.3			4.1		2.66			613.4			4.2		2.69
Total Investment Securities			6,676.3			37.7		2.25			6,985.3			37.5		2.14			7,587.0			38.8		2.04
Loans Held for Sale			0.7			—		7.41			0.4			—		6.63			0.1			—		6.50
Loans and Leases(1)
Commercial and industrial			2,148.1			36.7		6.78			2,123.5			35.7		6.66			2,126.3			28.1		5.24
Commercial real estate			4,356.3			71.4		6.51			4,381.8			71.4		6.47			4,116.8			53.9		5.19
Construction			888.7			16.7		7.45			873.7			15.5		7.05			804.4			11.8		5.83
Residential:
Residential mortgage			4,294.8			38.8		3.61			4,316.3			40.1		3.72			4,280.6			38.1		3.56
Home equity line			1,174.8			11.3		3.83			1,154.0			10.1		3.45			1,029.7			8.1		3.10
Consumer			1,132.4			18.4		6.43			1,172.8			18.3		6.19			1,220.9			17.1		5.55
Lease financing			354.2			3.6		4.03			327.3			3.7		4.48			297.4			2.9		3.92
Total Loans and Leases			14,349.3			196.9		5.45			14,349.4			194.8		5.39			13,876.1			160.0		4.58
Other Earning Assets			94.5			—		0.06			116.8			0.8		2.64			71.6			0.2		0.80
Total Earning Assets(2)			21,688.8			242.4		4.44			22,060.5			241.3		4.35			21,856.1			201.9		3.67
Cash and Due from Banks			240.8								276.0								286.4
Other Assets			2,475.1								2,391.4								2,433.1
Total Assets		$	24,404.7							$	24,727.9							$	24,575.6
Interest-Bearing Liabilities
Interest-Bearing Deposits
Savings		$	6,067.2		$	22.4		1.46	%	$	5,982.5		$	19.2		1.27	%		6,455.5		$	10.3		0.63	%
Money Market			3,905.0			27.5		2.79			3,907.2			24.7		2.51			4,012.9			9.8		0.97
Time			3,390.7			32.3		3.78			3,362.7			30.8		3.63			2,163.2			8.1		1.48
Total Interest-Bearing Deposits			13,362.9			82.2		2.44			13,252.4			74.7		2.23			12,631.6			28.2		0.89
Federal Funds Purchased			—			—		—			—			—		—			45.5			0.5		4.09
Other Short-Term Borrowings			515.2			6.2		4.80			113.1			1.5		5.17			—			—		—
Long-Term Borrowings			—			—		—			440.2			5.3		4.83			—			—		—
Other Interest-Bearing Liabilities			42.1			0.8		7.44			89.1			1.2		5.17			—			—		—
Total Interest-Bearing Liabilities			13,920.2			89.2		2.54			13,894.8			82.7		2.36			12,677.1			28.7		0.90
Net Interest Income					$	153.2							$	158.6							$	173.2
Interest Rate Spread								1.90	%							1.99	%							2.77	%
Net Interest Margin								2.81	%							2.86	%							3.15	%
Noninterest-Bearing Demand Deposits			7,545.3								7,959.7								9,093.6
Other Liabilities			564.5								506.0								591.9
Stockholders' Equity			2,374.7								2,367.4								2,213.0
Total Liabilities and Stockholders' Equity		$	24,404.7							$	24,727.9							$	24,575.6

                                                                     

(1)   Non-performing loans and leases are included in the respective average loan and lease balances. Income, if any, on such loans and leases is recognized on a cash basis.

(2)   Interest income includes taxable-equivalent basis adjustments of $1.4 million, $1.5 million and $1.4 million for the three months ended December 31, 2023, September 30, 2023 and December 31, 2022, respectively.

Average Balances and Interest Rates																Table 5
		Year Ended								Year Ended
		December 31, 2023								December 31, 2022
		Average			Income/			Yield/		Average			Income/			Yield/
(dollars in millions)		Balance			Expense			Rate		Balance			Expense			Rate
Earning Assets
Interest-Bearing Deposits in Other Banks		$	512.3		$	26.5		5.18	%	$	867.6		$	10.3		1.19	%
Available-for-Sale Investment Securities
Taxable			2,871.8			73.8		2.57			4,650.1			83.2		1.79
Non-Taxable			10.2			0.6		5.55			180.0			4.9		2.74
Held-to-Maturity Investment Securities
Taxable			3,579.0			60.7		1.70			2,728.2			45.5		1.67
Non-Taxable			607.7			15.9		2.61			460.6			12.5		2.71
Total Investment Securities			7,068.7			151.0		2.14			8,018.9			146.1		1.82
Loans Held for Sale			0.4			—		6.63			0.6			—		3.14
Loans and Leases(1)
Commercial and industrial			2,182.3			141.0		6.46			2,019.5			78.4		3.88
Commercial real estate			4,257.9			266.0		6.25			3,895.3			153.2		3.93
Construction			877.7			62.1		7.08			755.0			32.5		4.30
Residential:
Residential mortgage			4,308.0			156.4		3.63			4,200.2			145.5		3.46
Home equity line			1,131.1			39.3		3.47			965.0			26.5		2.75
Consumer			1,178.6			71.5		6.07			1,218.9			65.3		5.35
Lease financing			330.7			14.1		4.26			260.9			9.7		3.69
Total Loans and Leases			14,266.3			750.4		5.26			13,314.8			511.1		3.84
Other Earning Assets			104.3			1.3		1.20			70.9			0.6		0.89
Total Earning Assets(2)			21,952.0			929.2		4.23			22,272.8			668.1		3.00
Cash and Due from Banks			265.1								289.0
Other Assets			2,408.3								2,402.6
Total Assets		$	24,625.4							$	24,964.4
Interest-Bearing Liabilities
Interest-Bearing Deposits
Savings		$	6,124.7		$	71.5		1.17	%	$	6,741.5		$	19.2		0.29	%
Money Market			3,869.1			86.1		2.22			4,068.8			16.6		0.41
Time			3,040.0			100.6		3.31			1,826.7			13.4		0.73
Total Interest-Bearing Deposits			13,033.8			258.2		1.98			12,637.0			49.2		0.39
Federal Funds Purchased			17.2			0.8		4.45			11.5			0.5		4.08
Other Short-Term Borrowings			261.9			13.0		4.98			—			—		—
Long-Term Borrowings			261.6			12.5		4.78			—			—		—
Other Interest-Bearing Liabilities			57.1			3.0		5.15			—			—		—
Total Interest-Bearing Liabilities			13,631.6			287.5		2.11			12,648.5			49.7		0.39
Net Interest Income					$	641.7							$	618.4
Interest Rate Spread								2.12	%							2.61	%
Net Interest Margin								2.92	%							2.78	%
Noninterest-Bearing Demand Deposits			8,126.4								9,421.5
Other Liabilities			520.7								572.8
Stockholders' Equity			2,346.7								2,321.6
Total Liabilities and Stockholders' Equity		$	24,625.4							$	24,964.4

                                                                            

(1)   Non-performing loans and leases are included in the respective average loan and lease balances. Income, if any, on such loans and leases is recognized on a cash basis.

(2)   Interest income includes taxable-equivalent basis adjustments of $5.6 million and $4.9 million for the years ended December 31, 2023 and 2022, respectively.

Analysis of Change in Net Interest Income											Table 6
		Three Months Ended December 31, 2023
		Compared to September 30, 2023
(dollars in millions)		Volume				Rate				Total
Change in Interest Income:
Interest-Bearing Deposits in Other Banks		$	(0.5	)		$	0.1			$	(0.4	)
Available-for-Sale Investment Securities
Taxable			(1.6	)			2.2				0.6
Held-to-Maturity Investment Securities
Taxable			(0.2	)			—				(0.2	)
Non-Taxable			—				(0.2	)			(0.2	)
Total Investment Securities			(1.8	)			2.0				0.2
Loans and Leases
Commercial and industrial			0.4				0.6				1.0
Commercial real estate			(0.4	)			0.4				—
Construction			0.3				0.9				1.2
Residential:
Residential mortgage			(0.2	)			(1.1	)			(1.3	)
Home equity line			0.1				1.1				1.2
Consumer			(0.6	)			0.7				0.1
Lease financing			0.3				(0.4	)			(0.1	)
Total Loans and Leases			(0.1	)			2.2				2.1
Other Earning Assets			(0.2	)			(0.6	)			(0.8	)
Total Change in Interest Income			(2.6	)			3.7				1.1
Change in Interest Expense:
Interest-Bearing Deposits
Savings			0.3				2.9				3.2
Money Market			—				2.8				2.8
Time			0.2				1.3				1.5
Total Interest-Bearing Deposits			0.5				7.0				7.5
Other Short-Term Borrowings			4.9				(0.2	)			4.7
Long-Term Borrowings			(2.6	)			(2.7	)			(5.3	)
Other Interest-Bearing Liabilities			(0.8	)			0.4				(0.4	)
Total Change in Interest Expense			2.0				4.5				6.5
Change in Net Interest Income		$	(4.6	)		$	(0.8	)		$	(5.4	)

Analysis of Change in Net Interest Income											Table 7
		Three Months Ended December 31, 2023
		Compared to December 31, 2022
(dollars in millions)		Volume				Rate				Total
Change in Interest Income:
Interest-Bearing Deposits in Other Banks		$	3.0			$	1.9			$	4.9
Available-for-Sale Investment Securities
Taxable			(3.7	)			4.4				0.7
Non-Taxable			(0.5	)			—				(0.5	)
Held-to-Maturity Investment Securities
Taxable			(1.1	)			0.1				(1.0	)
Non-Taxable			(0.1	)			(0.2	)			(0.3	)
Total Investment Securities			(5.4	)			4.3				(1.1	)
Loans and Leases
Commercial and industrial			0.3				8.3				8.6
Commercial real estate			3.3				14.2				17.5
Construction			1.3				3.6				4.9
Residential:
Residential mortgage			0.1				0.6				0.7
Home equity line			1.2				2.0				3.2
Consumer			(1.3	)			2.6				1.3
Lease financing			0.6				0.1				0.7
Total Loans and Leases			5.5				31.4				36.9
Other Earning Assets			—				(0.2	)			(0.2	)
Total Change in Interest Income			3.1				37.4				40.5
Change in Interest Expense:
Interest-Bearing Deposits
Savings			(0.6	)			12.7				12.1
Money Market			(0.2	)			17.9				17.7
Time			6.4				17.8				24.2
Total Interest-Bearing Deposits			5.6				48.4				54.0
Federal Funds Purchased			(0.3	)			(0.2	)			(0.5	)
Other Short-Term Borrowings			6.2				—				6.2
Other Interest-Bearing Liabilities			0.8				—				0.8
Total Change in Interest Expense			12.3				48.2				60.5
Change in Net Interest Income		$	(9.2	)		$	(10.8	)		$	(20.0	)

Analysis of Change in Net Interest Income											Table 8
		Year Ended December 31, 2023
		Compared to December 31, 2022
(dollars in millions)		Volume				Rate				Total
Change in Interest Income:
Interest-Bearing Deposits in Other Banks		$	(5.8	)		$	22.0			$	16.2
Available-for-Sale Investment Securities
Taxable			(38.3	)			28.9				(9.4	)
Non-Taxable			(6.9	)			2.6				(4.3	)
Held-to-Maturity Investment Securities
Taxable			14.4				0.8				15.2
Non-Taxable			3.9				(0.5	)			3.4
Total Investment Securities			(26.9	)			31.8				4.9
Loans and Leases
Commercial and industrial			6.8				55.8				62.6
Commercial real estate			15.4				97.4				112.8
Construction			5.9				23.7				29.6
Residential:
Residential mortgage			3.7				7.2				10.9
Home equity line			5.1				7.7				12.8
Consumer			(2.3	)			8.5				6.2
Lease financing			2.8				1.6				4.4
Total Loans and Leases			37.4				201.9				239.3
Other Earning Assets			0.4				0.3				0.7
Total Change in Interest Income			5.1				256.0				261.1
Change in Interest Expense:
Interest-Bearing Deposits
Savings			(1.9	)			54.2				52.3
Money Market			(0.9	)			70.4				69.5
Time			13.8				73.4				87.2
Total Interest-Bearing Deposits			11.0				198.0				209.0
Federal Funds Purchased			0.2				0.1				0.3
Other Short-Term Borrowings			13.0				—				13.0
Long-Term Borrowings			12.5				—				12.5
Other Interest-Bearing Liabilities			3.0				—				3.0
Total Change in Interest Expense			39.7				198.1				237.8
Change in Net Interest Income		$	(34.6	)		$	57.9			$	23.3

Loans and Leases									Table 9
		December 31,			September 30,			December 31,
(dollars in thousands)		2023			2023			2022
Commercial and industrial:
Commercial and industrial excluding Paycheck Protection Program loans		$	2,156,872		$	2,091,379		$	2,217,604
Paycheck Protection Program loans			8,477			10,063			18,293
Total commercial and industrial			2,165,349			2,101,442			2,235,897
Commercial real estate			4,340,243			4,387,751			4,132,309
Construction			900,292			885,112			844,643
Residential:
Residential mortgage			4,283,315			4,303,924			4,302,788
Home equity line			1,174,588			1,167,388			1,055,351
Total residential			5,457,903			5,471,312			5,358,139
Consumer			1,109,901			1,154,203			1,222,934
Lease financing			379,809			332,515			298,090
Total loans and leases		$	14,353,497		$	14,332,335		$	14,092,012

Deposits									Table 10
		December 31,			September 30,			December 31,
(dollars in thousands)		2023			2023			2022
Demand		$	7,583,562		$	7,898,996		$	8,864,646
Savings			6,445,084			6,028,308			6,382,910
Money Market			3,847,853			3,923,054			3,965,423
Time			3,456,158			3,661,131			2,476,050
Total Deposits		$	21,332,657		$	21,511,489		$	21,689,029

Non-Performing Assets and Accruing Loans and Leases Past Due 90 Days or More									Table 11
		December 31,			September 30,			December 31,
(dollars in thousands)		2023			2023			2022
Non-Performing Assets
Non-Accrual Loans and Leases
Commercial Loans:
Commercial and industrial		$	970		$	988		$	1,215
Commercial real estate			2,953			—			727
Total Commercial Loans			3,923			988			1,942
Residential Loans:
Residential mortgage			7,620			7,435			6,166
Home equity line			7,052			6,200			3,797
Total Residential Loans			14,672			13,635			9,963
Total Non-Accrual Loans and Leases			18,595			14,623			11,905
Other Real Estate Owned			—			—			91
Total Non-Performing Assets		$	18,595		$	14,623		$	11,996
Accruing Loans and Leases Past Due 90 Days or More
Commercial Loans:
Commercial and industrial		$	494		$	289		$	291
Commercial real estate			300			170			—
Total Commercial Loans			794			459			291
Residential mortgage			—			1,430			58
Consumer			2,702			1,681			2,885
Total Accruing Loans and Leases Past Due 90 Days or More		$	3,496		$	3,570		$	3,234
Total Loans and Leases		$	14,353,497		$	14,332,335		$	14,092,012

Allowance for Credit Losses and Reserve for Unfunded Commitments		Table 12
		For the Three Months Ended												For the Year Ended
		December 31,				September 30,				December 31,				December 31,				December 31,
(dollars in thousands)		2023				2023				2022				2023				2022
Balance at Beginning of Period		$	192,570			$	184,780			$	178,304				177,735				187,584
Loans and Leases Charged-Off
Commercial Loans:
Commercial and industrial			(910	)			(784	)			(735	)			(3,482	)			(2,012	)
Commercial real estate			(2,500	)			—				—				(2,500	)			(750	)
Total Commercial Loans			(3,410	)			(784	)			(735	)			(5,982	)			(2,762	)
Residential Loans:
Residential mortgage			—				—				(102	)			(122	)			(103	)
Home equity line			(20	)			—				(12	)			(292	)			(1,175	)
Total Residential Loans			(20	)			—				(114	)			(414	)			(1,278	)
Consumer			(4,147	)			(3,665	)			(5,094	)			(17,110	)			(16,848	)
Total Loans and Leases Charged-Off			(7,577	)			(4,449	)			(5,943	)			(23,506	)			(20,888	)
Recoveries on Loans and Leases Previously Charged-Off
Commercial Loans:
Commercial and industrial			171				2,637				303				3,346				897
Commercial real estate			—				—				—				—				14
Lease financing			—				—				—				—				60
Total Commercial Loans			171				2,637				303				3,346				971
Residential Loans:
Residential mortgage			31				53				173				141				418
Home equity line			163				303				138				702				713
Total Residential Loans			194				356				311				843				1,131
Consumer			1,450				1,746				1,804				7,090				7,545
Total Recoveries on Loans and Leases Previously Charged-Off			1,815				4,739				2,418				11,279				9,647
Net Loans and Leases (Charged-Off) Recovered			(5,762	)			290				(3,525	)			(12,227	)			(11,241	)
Provision for Credit Losses			5,330				7,500				2,956				26,630				1,392
Balance at End of Period		$	192,138			$	192,570			$	177,735			$	192,138			$	177,735
Components:
Allowance for Credit Losses		$	156,533			$	154,795			$	143,900			$	156,533			$	143,900
Reserve for Unfunded Commitments			35,605				37,775				33,835				35,605				33,835
Total Allowance for Credit Losses and Reserve for Unfunded Commitments		$	192,138			$	192,570			$	177,735			$	192,138			$	177,735
Average Loans and Leases Outstanding		$	14,349,322			$	14,349,402			$	13,876,136			$	14,266,291			$	13,314,821
Ratio of Net Loans and Leases Charged-Off (Recovered) to Average Loans and Leases Outstanding(1)			0.16		%		(0.01	)	%		0.10		%		0.09		%		0.08		%
Ratio of Allowance for Credit Losses for Loans and Leases to Loans and Leases Outstanding			1.09		%		1.08		%		1.02		%		1.09		%		1.02		%
Ratio of Allowance for Credit Losses for Loans and Leases to Non-accrual Loans and Leases			8.42x				10.59x				12.09x				8.42x				12.09x

                                                                   

(1)   Annualized for the three months ended December 31, 2023, September 30, 2023 and December 31, 2022.

Loans and Leases by Year of Origination and Credit Quality Indicator																											Table 13
																							Revolving
																							Loans
																							Converted
		Term Loans																		Revolving			to Term
		Amortized Cost Basis by Origination Year																		Loans			Loans
																				Amortized			Amortized
(dollars in thousands)		2023			2022			2021			2020			2019			Prior			Cost Basis			Cost Basis			Total
Commercial Lending
Commercial and Industrial
Risk rating:
Pass		$	85,839		$	273,663		$	346,024		$	32,753		$	146,893		$	141,681		$	971,065		$	1,823		$	1,999,741
Special Mention			1			44,069			80			653			1,032			1,290			22,807			14			69,946
Substandard			—			342			230			677			1,686			829			8,330			—			12,094
Other (1)			15,978			11,598			4,814			2,370			1,702			1,125			45,981			—			83,568
Total Commercial and Industrial			101,818			329,672			351,148			36,453			151,313			144,925			1,048,183			1,837			2,165,349
Current period gross charge-offs			130			70			75			87			168			2,952			—			—			3,482
Commercial Real Estate
Risk rating:
Pass			346,369			872,783			676,362			337,529			523,446			1,414,613			74,238			1,350			4,246,690
Special Mention			2,307			7,618			41,320			1,359			13,550			11,998			819			—			78,971
Substandard			205			5,079			2,003			—			2,953			2,545			1,655			—			14,440
Other (1)			—			—			—			—			—			142			—			—			142
Total Commercial Real Estate			348,881			885,480			719,685			338,888			539,949			1,429,298			76,712			1,350			4,340,243
Current period gross charge-offs			—			—			—			—			2,500			—			—			—			2,500
Construction
Risk rating:
Pass			156,432			269,623			265,674			60,057			63,018			27,847			6,070			—			848,721
Special Mention			—			—			—			—			189			665			—			—			854
Other (1)			12,728			21,036			8,250			2,143			2,031			3,820			709			—			50,717
Total Construction			169,160			290,659			273,924			62,200			65,238			32,332			6,779			—			900,292
Current period gross charge-offs			—			—			—			—			—			—			—			—			—
Lease Financing
Risk rating:
Pass			145,914			82,833			18,680			31,791			30,299			68,520			—			—			378,037
Special Mention			56			137			414			35			—			—			—			—			642
Substandard			712			416			—			—			2			—			—			—			1,130
Total Lease Financing			146,682			83,386			19,094			31,826			30,301			68,520			—			—			379,809
Current period gross charge-offs			—			—			—			—			—			—			—			—			—
Total Commercial Lending		$	766,541		$	1,589,197		$	1,363,851		$	469,367		$	786,801		$	1,675,075		$	1,131,674		$	3,187		$	7,785,693
Current period gross charge-offs		$	130		$	70		$	75		$	87		$	2,668		$	2,952		$	—		$	—		$	5,982

																							Revolving
																							Loans
																							Converted
		Term Loans																		Revolving			to Term
		Amortized Cost Basis by Origination Year																		Loans			Loans
(continued)																				Amortized			Amortized
(dollars in thousands)		2023			2022			2021			2020			2019			Prior			Cost Basis			Cost Basis			Total
Residential Lending
Residential Mortgage
FICO:
740 and greater		$	211,598		$	529,296		$	999,522		$	529,881		$	227,058		$	987,251		$	—		$	—		$	3,484,606
680 - 739			36,975			67,205			117,337			68,122			33,148			130,387			—			—			453,174
620 - 679			3,544			16,395			19,184			12,811			4,096			38,987			—			—			95,017
550 - 619			1,305			6,521			1,917			2,492			398			11,679			—			—			24,312
Less than 550			—			—			2,909			2,017			582			6,439			—			—			11,947
No Score (3)			9,137			19,311			11,492			6,043			9,679			51,109			—			—			106,771
Other (2)			15,802			17,528			17,432			12,534			8,599			25,513			10,080			—			107,488
Total Residential Mortgage			278,361			656,256			1,169,793			633,900			283,560			1,251,365			10,080			—			4,283,315
Current period gross charge-offs			—			—			—			—			—			122			—			—			122
Home Equity Line
FICO:
740 and greater			—			—			—			—			—			—			964,932			1,511			966,443
680 - 739			—			—			—			—			—			—			151,716			1,920			153,636
620 - 679			—			—			—			—			—			—			36,541			1,189			37,730
550 - 619			—			—			—			—			—			—			9,896			1,012			10,908
Less than 550			—			—			—			—			—			—			4,488			100			4,588
No Score (3)			—			—			—			—			—			—			1,283			—			1,283
Total Home Equity Line			—			—			—			—			—			—			1,168,856			5,732			1,174,588
Current period gross charge-offs			—			—			—			—			—			—			273			19			292
Total Residential Lending		$	278,361		$	656,256		$	1,169,793		$	633,900		$	283,560		$	1,251,365		$	1,178,936		$	5,732		$	5,457,903
Current period gross charge-offs		$	—		$	—		$	—		$	—		$	—		$	122		$	273		$	19		$	414
Consumer Lending
FICO:
740 and greater			92,117			128,358			76,148			33,507			21,819			8,970			123,592			155			484,666
680 - 739			68,865			71,031			37,925			17,116			13,270			5,690			76,645			401			290,943
620 - 679			28,533			29,229			16,919			7,843			7,972			4,624			35,210			781			131,111
550 - 619			4,996			10,859			7,760			4,917			4,651			2,986			13,223			925			50,317
Less than 550			1,790			6,370			4,842			2,796			2,905			2,040			5,222			455			26,420
No Score (3)			1,545			229			—			—			1			10			42,933			136			44,854
Other (2)			361			368			982			335			1,059			1			78,484			—			81,590
Total Consumer Lending		$	198,207		$	246,444		$	144,576		$	66,514		$	51,677		$	24,321		$	375,309		$	2,853		$	1,109,901
Current period gross charge-offs		$	639		$	2,400		$	2,135		$	1,142		$	1,816		$	2,622		$	5,790		$	566		$	17,110
Total Loans and Leases		$	1,243,109		$	2,491,897		$	2,678,220		$	1,169,781		$	1,122,038		$	2,950,761		$	2,685,919		$	11,772		$	14,353,497
Current period gross charge-offs		$	769		$	2,470		$	2,210		$	1,229		$	4,484		$	5,696		$	6,063		$	585		$	23,506

                                                                   

(1)   Other credit quality indicators used for monitoring purposes are primarily FICO scores. The majority of the loans in this population were originated to borrowers with a prime FICO score.

(2)   Other credit quality indicators used for monitoring purposes are primarily internal risk ratings. The majority of the loans in this population were graded with a “Pass” rating.

(3)   No FICO scores are primarily related to loans and leases extended to non-residents. Loans and leases of this nature are primarily secured by collateral and/or are closely monitored for performance.

GAAP to Non-GAAP Reconciliation		Table 14
		For the Three Months Ended									For the Year Ended
		December 31,			September 30,			December 31,			December 31,
(dollars in thousands)		2023			2023			2022			2023			2022
Income Statement Data:
Net income		$	47,502		$	58,221		$	79,588		$	234,983		$	265,685
Average total stockholders' equity		$	2,374,669		$	2,367,422		$	2,213,030		$	2,346,713		$	2,321,606
Less: average goodwill			995,492			995,492			995,492			995,492			995,492
Average tangible stockholders' equity		$	1,379,177		$	1,371,930		$	1,217,538		$	1,351,221		$	1,326,114
Average total assets		$	24,404,727		$	24,727,893		$	24,575,648		$	24,625,445		$	24,964,422
Less: average goodwill			995,492			995,492			995,492			995,492			995,492
Average tangible assets		$	23,409,235		$	23,732,401		$	23,580,156		$	23,629,953		$	23,968,930
Return on average total stockholders' equity(1)			7.94	%		9.76	%		14.27	%		10.01	%		11.44	%
Return on average tangible stockholders' equity (non-GAAP)(1)			13.66	%		16.84	%		25.93	%		17.39	%		20.03	%
Return on average total assets(1)			0.77	%		0.93	%		1.28	%		0.95	%		1.06	%
Return on average tangible assets (non-GAAP)(1)			0.81	%		0.97	%		1.34	%		0.99	%		1.11	%

		As of			As of			As of
		December 31,			September 30,			December 31,
(dollars in thousands, except per share amounts)		2023			2023			2022
Balance Sheet Data:
Total stockholders' equity		$	2,486,066		$	2,351,009		$	2,269,005
Less: goodwill			995,492			995,492			995,492
Tangible stockholders' equity		$	1,490,574		$	1,355,517		$	1,273,513
Total assets		$	24,926,474		$	24,912,524		$	24,577,223
Less: goodwill			995,492			995,492			995,492
Tangible assets		$	23,930,982		$	23,917,032		$	23,581,731
Shares outstanding			127,618,761			127,609,934			127,363,327
Total stockholders' equity to total assets			9.97	%		9.44	%		9.23	%
Tangible stockholders' equity to tangible assets (non-GAAP)			6.23	%		5.67	%		5.40	%
Book value per share		$	19.48		$	18.42		$	17.82
Tangible book value per share (non-GAAP)		$	11.68		$	10.62		$	10.00

                                                                     

(1)   Annualized for the three months ended December 31, 2023, September 30, 2023 and December 31, 2022.