• Wintrust Financial Corporation Reports Record Year-to-Date Net Income

    Source: Nasdaq GlobeNewswire / 19 Jul 2023 18:08:13   America/New_York

    ROSEMONT, Ill., July 19, 2023 (GLOBE NEWSWIRE) -- Wintrust Financial Corporation (“Wintrust”, “the Company”, “we” or “our”) (Nasdaq: WTFC) announced record net income of $334.9 million or $5.18 per diluted common share for the first six months of 2023 compared to net income of $221.9 million or $3.56 per diluted common share for the same period of 2022, an increase in diluted earnings per common share of 46%. Pre-tax, pre-provision income (non-GAAP) for the first six months of 2023 totaled $506.5 million as compared to $329.9 million in the first six months of 2022, an increase in pre-tax, pre-provision income of 54%.

    The Company recorded quarterly net income of $154.8 million or $2.38 per diluted common share for the second quarter of 2023, a decrease in diluted earnings per common share of 15% compared to the first quarter of 2023. Pre-tax, pre-provision income (non-GAAP) totaled $239.9 million as compared to $266.6 million for the first quarter of 2023.

    Timothy S. Crane, President and Chief Executive Officer, commented, “We are very pleased with our record net income for the first half of 2023. Our margin stabilized in the second quarter of 2023 and we continue to believe that maintaining such level will allow for strong financial performance in the coming quarters. Specifically, the repricing of our premium finance receivables portfolios in the second quarter helped offset increases in deposit pricing. Strong and balanced deposit growth as well as prudent liquidity management provided stability in our balance sheet through this period of volatility. Credit performance within the portfolio remained strong.”

    Highlights of the second quarter of 2023:
    Comparative information to the first quarter of 2023, unless otherwise noted

    • Total deposits grew by $1.3 billion, or 12.4% annualized.
    • Non-deposit borrowings decreased by $208.2 million.
    • Total loans increased by $1.5 billion, or 14.8% annualized.
    • Net interest margin decreased to 3.64% (3.66% on a fully taxable-equivalent basis, non-GAAP) during the second quarter of 2023 due to higher deposit costs. Importantly, however, net interest margin remained relatively stable throughout the second quarter of 2023.
    • Provision for credit losses totaled $28.5 million in the second quarter of 2023 as compared to a provision for credit losses of $23.0 million in the first quarter of 2023.
    • Net charge-offs totaled $17.0 million or 17 basis points of average total loans on an annualized basis in the second quarter of 2023 as compared to $5.5 million or six basis points of average total loans on an annualized basis in the first quarter of 2023.
    • Non-performing assets remained at a low level and represent 0.22% of total assets.

    Mr. Crane noted, “By effectively leveraging our strong customer relationships, unique market position, diversified products and competitive rates, Wintrust experienced significant deposit growth, with increased deposits of approximately $1.3 billion, or 12% on an annualized basis. This included outstanding balances of our MaxSafe® products increasing approximately $1.7 billion since the end of the first quarter of 2023. Deposit growth provided enhanced liquidity and reduced our reliance on other borrowings such as FHLB advances. Non-deposit borrowings decreased approximately $208.2 million during the quarter. Growth in deposits helped fund approximately $1.5 billion of loan growth during the quarter. This growth came primarily from approximately $1.0 billion in the commercial premium finance receivables portfolio and approximately $370 million largely from draws on existing commercial real estate loan facilities. We remain prudent in our review of credit prospects ensuring our loan growth stays within our conservative credit standards.”

    Mr. Crane commented, “As noted in our first quarter earnings release, our net interest margin was approximately 3.70% at the end of March of 2023. Despite continued acceleration in deposit pricing and the impact of hedging activity, our net interest margin remained relatively stable throughout the second quarter of 2023. Due to our relatively short-term and asset sensitive balance sheet, we believe that we can maintain the net interest margin between 3.60% and 3.70% for the remainder of the year as we expect further upward repricing primarily in our premium finance receivable portfolios to mitigate higher deposit costs as deposit pricing stabilizes. Net interest income decreased by $10.5 million in the second quarter of 2023, however, we expect net interest income to increase in the third quarter given the aforementioned strong balance sheet growth paired with a stable net interest margin.”

    Commenting on credit quality, Mr. Crane stated, “Credit metrics remained strong. The Company has a well-diversified commercial real estate portfolio with exposures primarily consisting of stabilized, income-producing properties. Additionally, the commercial real estate office portfolio represents a small portion of our loan portfolio. In the second quarter of 2023, we took a proactive approach to exit certain credits we considered to be vulnerable to existing market conditions. The resolution of these credits through a sale to external parties resulted in approximately $8.0 million in charge-offs. Net charge-offs totaled $17.0 million or 17 basis points of average total loans on an annualized basis in the second quarter of 2023 as compared to $5.5 million or six basis points of average total loans on an annualized basis in the first quarter of 2023. The allowance for credit losses on our core loan portfolio as of June 30, 2023 was approximately 1.50% of the outstanding balance (see Table 12 for additional information). We believe that the Company’s reserves remain appropriate and we remain diligent in our review of credit.”

    Mr. Crane concluded, “Our second quarter of 2023 results continued to demonstrate the benefits of the diversified, multi-faceted nature of our business model. Net income for the quarter was the second highest in our history, behind only net income from the first quarter of 2023. We remain focused on continuing to grow deposits to enhance liquidity and support future asset growth while remaining well positioned for higher interest rates. Total loans as of June 30, 2023 were $917 million higher than average total loans in the second quarter of 2023, which is expected to benefit the third quarter. We are pleased by our position in the markets we serve to continue to grow deposit and loan relationships and believe we are situated well to expand our net revenues and earnings in the coming quarters.”

    The graphs below illustrate certain financial highlights of the second quarter of 2023 as well as historical financial performance. See “Supplemental Non-GAAP Financial Measures/Ratios” at Table 17 for additional information with respect to non-GAAP financial measures/ratios, including the reconciliations to the corresponding GAAP financial measures/ratios.

    Graphs available at the following link: 
    http://ml.globenewswire.com/Resource/Download/92e4bba1-fb72-4c4a-8da7-f33effeda53f

    SUMMARY OF RESULTS:

    BALANCE SHEET

    Total assets increased $1.4 billion in the second quarter of 2023 as compared to the first quarter of 2023. Total loans increased by $1.5 billion as compared to the first quarter of 2023 primarily due to growth in the property and casualty insurance premium finance receivables and commercial real estate loan portfolios. The growth in the commercial real estate portfolio was largely driven by draws on previously-established credit facilities. Additionally, in the second quarter of 2023, the Company received settlement proceeds related to securities called and previously recognized as a trade date receivable of $940 million as of March 31, 2023. Proceeds received increased interest bearing cash on the balance sheet in the second quarter of 2023.

    Total liabilities increased by $1.4 billion in the second quarter of 2023 as compared to the first quarter of 2023 primarily due to a $1.3 billion increase in total deposits. In the second quarter of 2023, the deposit mix shift continued as non-interest bearing deposits made up 24% of total deposits at June 30, 2023 compared to 26% at March 31, 2023. This included growth of $1.7 billion in the Company’s unique MaxSafe® product balances. The majority of the Company’s deposits are insured as approximately 74% of the total deposit balance is either fully FDIC-insured or fully collateralized as of June 30, 2023.

    For more information regarding changes in the Company’s balance sheet, see Consolidated Statements of Condition and Table 1 through Table 3 in this report.

    NET INTEREST INCOME

    For the second quarter of 2023, net interest income totaled $447.5 million, a decrease of $10.5 million as compared to the first quarter of 2023. The $10.5 million decrease in net interest income in the second quarter of 2023 compared to the first quarter of 2023 was primarily due to net interest margin compression driven by an increase in deposit costs and the impact from hedges of our loan portfolio established to protect against the impact of lower rates.

    Net interest margin was 3.64% (3.66% on a fully taxable-equivalent basis, non-GAAP) during the second quarter of 2023 compared to 3.81% (3.83% on a fully taxable-equivalent basis, non-GAAP) during the first quarter of 2023. The net interest margin decrease as compared to the first quarter of 2023 was due to a 66 basis point increase in the rate paid on interest-bearing liabilities. This decrease was partially offset by a 34 basis point increase in yield on earning assets and a 15 basis point increase in the net free funds contribution. The 66 basis point increase on the rate paid on interest-bearing liabilities in the second quarter of 2023 as compared to the first quarter of 2023 was primarily due to a 74 basis point increase in the rate paid on interest-bearing deposits primarily related to the increasing rate environment. The 34 basis point increase in the yield on earning assets in the second quarter of 2023 as compared to the first quarter of 2023 was primarily due to a 42 basis point expansion on loan yields, which included an unfavorable eight basis point impact from the Company’s existing hedging positions.

    For more information regarding net interest income, see Table 4 through Table 8 in this report.

    ASSET QUALITY

    The allowance for credit losses totaled $387.8 million as of June 30, 2023, an increase of $11.5 million as compared to $376.3 million as of March 31, 2023. A provision for credit losses totaling $28.5 million was recorded for the second quarter of 2023 as compared to $23.0 million recorded in the first quarter of 2023. For more information regarding the provision for credit losses, see Table 11 in this report.

    Management believes the allowance for credit losses is appropriate to account for expected credit losses. The Current Expected Credit Losses (“CECL”) accounting standard requires the Company to estimate expected credit losses over the life of the Company’s financial assets as of the reporting date. There can be no assurances, however, that future losses will not significantly exceed the amounts provided for, thereby affecting future results of operations. A summary of the allowance for credit losses calculated for the loan components in each portfolio as of June 30, 2023, March 31, 2023, and December 31, 2022 is shown on Table 12 of this report.

    Net charge-offs totaled $17.0 million in the second quarter of 2023, as compared to $5.5 million of net charge-offs in the first quarter of 2023. The increase in net charge-offs during the second quarter of 2023 was partially the result of the sale to external parties of certain credits within the commercial real estate portfolio, which resulted in approximately $8.0 million in charge-offs. Net charge-offs as a percentage of average total loans were reported as 17 basis points in the second quarter of 2023 on an annualized basis compared to six basis points on an annualized basis in the first quarter of 2023. For more information regarding net charge-offs, see Table 10 in this report.

    The Company’s delinquency rates remain low and manageable. For more information regarding past due loans, see Table 13 in this report.

    Non-performing assets totaled $120 million and comprised only 0.22% of total assets as of June 30, 2023, as compared to $110 million as of March 31, 2023. Non-performing loans were slightly higher totaling $109 million, or 0.26% of total loans, at June 30, 2023. For more information regarding non-performing assets, see Table 14 in this report.

    NON-INTEREST INCOME

    Wealth management revenue increased by $3.9 million in the second quarter of 2023 as compared to the first quarter of 2023 primarily due to increased asset management fees from the acquisition of two asset management businesses at the beginning of the second quarter, offset by lower fees associated with our tax-deferred like-kind exchange business. Wealth management revenue is comprised of the trust and asset management revenue of The Chicago Trust Company and Great Lakes Advisors, the brokerage commissions, managed money fees and insurance product commissions at Wintrust Investments and fees from tax-deferred like-kind exchange services provided by the Chicago Deferred Exchange Company.

    Mortgage banking revenue increased by $11.7 million in the second quarter of 2023 as compared to the first quarter of 2023 primarily due to increased loan volume and favorable adjustments to the fair value of certain mortgage assets. The Company recorded net positive fair value adjustments of $1.2 million in the second quarter of 2023 related to fair value changes in certain mortgage assets. This included a $2.0 million favorable adjustment in the value of mortgage servicing rights related to changes in fair value model assumptions, net of economic hedges, offset by a $739,000 unfavorable adjustment on the Company’s held-for-sale portfolio of early buy-out exercised loans guaranteed by U.S. government agencies which are held at fair value. The Company intends to monitor the relationship of these assets and will seek to minimize the earnings impact of fair value changes in future quarters.

    The Company recognized nominal net gains on investment securities in the second quarter of 2023 as compared to net gains of $1.4 million in the first quarter of 2023 related to changes in the value of equity securities.

    Fees from covered call options decreased by $7.8 million in the second quarter of 2023 as compared to the first quarter of 2023. The Company has typically written call options with terms of less than three months against certain U.S. Treasury and agency securities held in its portfolio for liquidity and other purposes. Management has entered into these transactions with the goal of economically hedging security positions and enhancing its overall return on its investment portfolio. These option transactions are designed to mitigate overall interest rate risk and do not qualify as hedges pursuant to accounting guidance.

    For more information regarding non-interest income, see Table 15 in this report.

    NON-INTEREST EXPENSE

    Salaries and employee benefits expense increased by $8.1 million in the second quarter of 2023 as compared to the first quarter of 2023. The $8.1 million increase is primarily related to higher incentive compensation expense due to elevated commissions and bonus accruals in the second quarter of 2023 and increased employee insurance costs.

    Advertising and marketing expenses in the second quarter of 2023 totaled $17.8 million, which is a $5.8 million increase as compared to the first quarter of 2023 primarily due to an increase in seasonal media advertising and sponsorship costs. Marketing costs are incurred to promote the Company’s brand, commercial banking capabilities and the Company’s various products, to attract loans and deposits and to announce new branch openings as well as the expansion of the Company’s non-bank businesses. The level of marketing expenditures depends on the timing of sponsorship programs utilized which are determined based on the market area, targeted audience, competition and various other factors. Generally, these expenses are elevated in the second and third quarters of each year.

    Lending expenses, net of deferred origination costs, increased by $4.8 million as compared to the first quarter of 2023 primarily due to increased loan originations in the second quarter of 2023.

    Miscellaneous expense in the second quarter of 2023 decreased by $2.3 million as compared to the first quarter of 2023. Miscellaneous expense includes ATM expenses, correspondent bank charges, directors’ fees, telephone, postage, corporate insurance, dues and subscriptions, problem loan expenses and other miscellaneous operational losses and costs.

    For more information regarding non-interest expense, see Table 16 in this report.

    INCOME TAXES

    The Company recorded income tax expense of $56.7 million in the second quarter of 2023 compared to $63.4 million in the first quarter of 2023. The effective tax rates were 26.81% in the second quarter of 2023 compared to 26.01% in the first quarter of 2023. The effective tax rates were partially impacted by the tax effects related to share-based compensation which fluctuate based on the Company’s stock price and timing of employee stock option exercises and vesting of other share-based awards. The Company recorded net excess tax benefits of $12,000 in the second quarter of 2023, compared to net excess tax benefits of $2.8 million in the first quarter of 2023 related to share-based compensation.

    BUSINESS UNIT SUMMARY

    Community Banking

    Through its community banking unit, the Company provides banking and financial services primarily to individuals, small to mid-sized businesses, local governmental units and institutional clients residing primarily in the local areas the Company services. In the second quarter of 2023, this unit expanded its commercial real estate and residential real estate loan portfolios and grew consumer deposits.

    Mortgage banking revenue was $30.0 million for the second quarter of 2023, an increase of $11.7 million as compared to the first quarter of 2023, primarily due to higher production volume. Service charges on deposit accounts totaled $13.6 million in the second quarter of 2023, an increase of $705,000 as compared to the first quarter of 2023, primarily due to higher fees associated with commercial account activity. The Company’s gross commercial and commercial real estate loan pipelines remained solid as of June 30, 2023 indicating momentum for expected continued loan growth in the third quarter of 2023.

    Specialty Finance

    Through its specialty finance unit, the Company offers financing of insurance premiums for businesses and individuals, equipment financing through structured loans and lease products to customers in a variety of industries, accounts receivable financing and value-added, out-sourced administrative services and other services. Originations within the insurance premium financing receivables portfolio were $5.0 billion during the second quarter of 2023 and average balances increased by $370.0 million as compared to the first quarter of 2023. The Company’s leasing portfolio balance remained steady in the second quarter of 2023, with its portfolio of assets, including capital leases, loans and equipment on operating leases, totaling $3.1 billion as of June 30, 2023 as compared to $3.1 billion as of March 31, 2023. Revenues from the Company’s out-sourced administrative services business were $1.3 million in the second quarter of 2023, a decrease of $296,000 from the first quarter of 2023.

    Wealth Management

    Through four separate subsidiaries within its wealth management unit, the Company offers a full range of wealth management services, including trust and investment services, tax-deferred like-kind exchange services, asset management, securities brokerage services and 401(k) and retirement plan services. Wealth management revenue totaled $33.9 million in the second quarter of 2023, an increase of $3.9 million compared to the first quarter of 2023. The increase in wealth management revenue in the second quarter of 2023 was primarily related to higher asset management fees from the acquisition of two asset management businesses at the beginning of the second quarter, offset by lower fees associated with our tax-deferred like-kind exchange business. At June 30, 2023, the Company’s wealth management subsidiaries had approximately $44.5 billion of assets under administration, which included $7.6 billion of assets owned by the Company and its subsidiary banks, representing an increase from the $35.2 billion of assets under administration at March 31, 2023. The increase in assets under administration was primarily the result of the acquisition of two asset management businesses in the second quarter of 2023.

    ITEMS IMPACTING COMPARATIVE FINANCIAL RESULTS

    Business Combination

    On April 3, 2023, the Company completed its acquisition of Rothschild & Co Asset Management US Inc. and Rothschild & Co Risk Based Investments LLC from Rothschild & Co North America Inc. As of the acquisition date, the Company acquired approximately $12.6 million in assets. As the transaction was determined to be a business combination, the Company recorded goodwill of approximately $2.6 million on the purchase.

    Common Stock Offering

    In June 2022, the Company sold through a public offering a total of 3,450,000 shares of its common stock. Net proceeds to the Company totaled approximately $285.7 million, net of estimated issuance costs.

    WINTRUST FINANCIAL CORPORATION 
    Key Operating Measures

    Wintrust’s key operating measures and growth rates for the second quarter of 2023, as compared to the first quarter of 2023 (sequential quarter) and second quarter of 2022 (linked quarter), are shown in the table below:

           % or(1)
    basis point 
    (bp) change
    from

    1st Quarter
    2023
     % or
    basis point 
    (bp) change
    from

    2nd Quarter
    2022
      Three Months Ended 
    (Dollars in thousands, except per share data) Jun 30, 2023 Mar 31, 2023 Jun 30, 2022 
    Net income $154,750  $180,198  $94,513 (14) %  64 %
    Pre-tax income, excluding provision for credit losses (non-GAAP)(2)  239,944   266,595   152,078 (10)  58 
    Net income per common share – diluted  2.38   2.80   1.49 (15)  60 
    Cash dividends declared per common share  0.40   0.40   0.34 0   18 
    Net revenue(3)  560,567   565,764   440,746 (1)  27 
    Net interest income  447,537   457,995   337,804 (2)  32 
    Net interest margin  3.64%  3.81%  2.92%(17) bps  72 bps
    Net interest margin – fully taxable-equivalent (non-GAAP)(2)  3.66   3.83   2.93 (17)  73 
    Net overhead ratio(4)  1.58   1.49   1.51 9   7 
    Return on average assets  1.18   1.40   0.77 (22)  41 
    Return on average common equity  12.79   15.67   8.53 (288)  426 
    Return on average tangible common equity (non-GAAP)(2)  15.12   18.55   10.36 (343)  476 
    At end of period           
    Total assets $54,286,176  $52,873,511  $50,969,332 11 %   7 %
    Total loans(5)  41,023,408   39,565,471   37,053,103 15   11 
    Total deposits  44,038,707   42,718,211   42,593,326 12   3 
    Total shareholders’ equity  5,041,912   5,015,506   4,727,623 2   7 

    (1)   Period-end balance sheet percentage changes are annualized.
    (2)   
    See Table 17: Supplemental Non-GAAP Financial Measures/Ratios for additional information on this performance measure/ratio.
    (3)   Net revenue is net interest income plus non-interest income.
    (4)   The net overhead ratio is calculated by netting total non-interest expense and total non-interest income, annualizing this amount, and dividing by that period’s average total assets. A lower ratio indicates a higher degree of efficiency.
    (5)   Excludes mortgage loans held-for-sale.

    Certain returns, yields, performance ratios, or quarterly growth rates are “annualized” in this presentation to represent an annual time period. This is done for analytical purposes to better discern, for decision-making purposes, underlying performance trends when compared to full-year or year-over-year amounts. For example, a 5% growth rate for a quarter would represent an annualized 20% growth rate. Additional supplemental financial information showing quarterly trends can be found on the Company’s website at www.wintrust.com by choosing “Financial Reports” under the “Investor Relations” heading, and then choosing “Financial Highlights.”

    WINTRUST FINANCIAL CORPORATION
    Selected Financial Highlights

      Three Months EndedSix Months Ended
    (Dollars in thousands, except per share data) Jun 30,
    2023
     Mar 31,
    2023
     Dec 31,
    2022
     Sep 30,
    2022
     Jun 30,
    2022
    Jun 30,
    2023
     Jun 30,
    2022
    Selected Financial Condition Data (at end of period):   
    Total assets $54,286,176  $52,873,511  $52,949,649  $52,382,939  $50,969,332    
    Total loans(1)  41,023,408   39,565,471   39,196,485   38,167,613   37,053,103    
    Total deposits  44,038,707   42,718,211   42,902,544   42,797,191   42,593,326    
    Total shareholders’ equity  5,041,912   5,015,506   4,796,838   4,637,980   4,727,623    
    Selected Statements of Income Data:   
    Net interest income $447,537  $457,995  $456,816  $401,448  $337,804 $905,532  $637,098 
    Net revenue(2)  560,567   565,764   550,655   502,930   440,746  1,126,331   902,830 
    Net income  154,750   180,198   144,817   142,961   94,513  334,948   221,904 
    Pre-tax income, excluding provision for credit losses (non-GAAP)(3)  239,944   266,595   242,819   206,461   152,078  506,539   329,864 
    Net income per common share – Basic  2.41   2.84   2.27   2.24   1.51  5.26   3.61 
    Net income per common share – Diluted  2.38   2.80   2.23   2.21   1.49  5.18   3.56 
    Cash dividends declared per common share  0.40   0.40   0.34   0.34   0.34  0.80   0.68 
    Selected Financial Ratios and Other Data:   
    Performance Ratios:   
    Net interest margin  3.64%  3.81%  3.71%  3.34%  2.92% 3.72%  2.76%
    Net interest margin – fully taxable-equivalent (non-GAAP)(3)  3.66   3.83   3.73   3.35   2.93  3.74   2.77 
    Non-interest income to average assets  0.86   0.84   0.71   0.79   0.84  0.85   1.08 
    Non-interest expense to average assets  2.44   2.33   2.34   2.32   2.35  2.39   2.34 
    Net overhead ratio(4)  1.58   1.49   1.63   1.53   1.51  1.54   1.25 
    Return on average assets  1.18   1.40   1.10   1.12   0.77  1.29   0.91 
    Return on average common equity  12.79   15.67   12.72   12.31   8.53  14.20   10.22 
    Return on average tangible common equity (non-GAAP)(3)  15.12   18.55   15.21   14.68   10.36  16.79   12.40 
    Average total assets $52,601,953  $52,075,318  $52,087,618  $50,722,694  $49,353,426 $52,340,090  $49,427,225 
    Average total shareholders’ equity  5,044,718   4,895,271   4,710,856   4,795,387   4,526,110  4,970,407   4,513,356 
    Average loans to average deposits ratio  94.3%  93.0%  90.5%  88.8%  86.8% 93.7%  85.3%
    Period-end loans to deposits ratio  93.2   92.6   91.4   89.2   87.0    
    Common Share Data at end of period:   
    Market price per common share $72.62  $72.95  $84.52  $81.55  $80.15    
    Book value per common share  75.65   75.24   72.12   69.56   71.06    
    Tangible book value per common share (non-GAAP)(3)  64.50   64.22   61.00   58.42   59.87    
    Common shares outstanding  61,197,676   61,176,415   60,794,008   60,743,335   60,721,889    
    Other Data at end of period:   
    Tier 1 leverage ratio(5)  9.3%  9.1%  8.8%  8.8%  8.8%   
    Risk-based capital ratios:             
    Tier 1 capital ratio(5)  10.1   10.1   10.0   9.9   9.9    
    Common equity tier 1 capital ratio(5)  9.2   9.2   9.1   9.0   9.0    
    Total capital ratio(5)  11.9   12.1   11.9   11.8   11.9    
    Allowance for credit losses(6) $387,786  $376,261  $357,936  $315,338  $312,192    
    Allowance for loan and unfunded lending-related commitment losses to total loans  0.94%  0.95%  0.91%  0.83%  0.84%   
    Number of:             
    Bank subsidiaries  15   15   15   15   15    
    Banking offices  175   174   174   174   173    

    (1)   Excludes mortgage loans held-for-sale.
    (2)   Net revenue is net interest income and non-interest income.
    (3)   See Table 17: Supplemental Non-GAAP Financial Measures/Ratios for additional information on this performance measure/ratio.
    (4)   The net overhead ratio is calculated by netting total non-interest expense and total non-interest income, annualizing this amount, and dividing by that period’s average total assets. A lower ratio indicates a higher degree of efficiency.
    (5)   Capital ratios for current quarter-end are estimated.
    (6)   The allowance for credit losses includes the allowance for loan losses, the allowance for unfunded lending-related commitments and the allowance for held-to-maturity securities losses.

    WINTRUST FINANCIAL CORPORATION AND SUBSIDIARIES
    CONSOLIDATED STATEMENTS OF CONDITION

      (Unaudited) (Unaudited)   (Unaudited) (Unaudited)
      Jun 30, Mar 31, Dec 31, Sep 30, Jun 30,
    (In thousands)  2023   2023   2022   2022   2022 
    Assets          
    Cash and due from banks $513,858  $445,928  $490,908  $489,590  $498,891 
    Federal funds sold and securities purchased under resale agreements  59   58   58   57   475,056 
    Interest-bearing deposits with banks  2,163,708   1,563,578   1,988,719   3,968,605   3,266,541 
    Available-for-sale securities, at fair value  3,492,481   3,259,845   3,243,017   2,923,653   2,970,121 
    Held-to-maturity securities, at amortized cost  3,564,473   3,606,391   3,640,567   3,389,842   3,413,469 
    Trading account securities  3,027   102   1,127   179   1,010 
    Equity securities with readily determinable fair value  116,275   111,943   110,365   114,012   93,295 
    Federal Home Loan Bank and Federal Reserve Bank stock  195,117   244,957   224,759   178,156   136,138 
    Brokerage customer receivables  15,722   16,042   16,387   20,327   21,527 
    Mortgage loans held-for-sale, at fair value  338,728   302,493   299,935   376,160   513,232 
    Loans, net of unearned income  41,023,408   39,565,471   39,196,485   38,167,613   37,053,103 
    Allowance for loan losses  (302,499)  (287,972)  (270,173)  (246,110)  (251,769)
    Net loans  40,720,909   39,277,499   38,926,312   37,921,503   36,801,334 
    Premises, software and equipment, net  749,393   760,283   764,798   763,029   762,381 
    Lease investments, net  274,351   256,301   253,928   244,822   223,813 
    Accrued interest receivable and other assets  1,455,748   1,413,795   1,391,342   1,316,305   1,112,697 
    Trade date securities receivable     939,758   921,717       
    Goodwill  656,674   653,587   653,524   653,079   654,709 
    Other acquisition-related intangible assets  25,653   20,951   22,186   23,620   25,118 
    Total assets $54,286,176  $52,873,511  $52,949,649  $52,382,939  $50,969,332 
    Liabilities and Shareholders’ Equity          
    Deposits:          
    Non-interest-bearing $10,604,915  $11,236,083  $12,668,160  $13,529,277  $13,855,844 
    Interest-bearing  33,433,792   31,482,128   30,234,384   29,267,914   28,737,482 
    Total deposits  44,038,707   42,718,211   42,902,544   42,797,191   42,593,326 
    Federal Home Loan Bank advances  2,026,071   2,316,071   2,316,071   2,316,071   1,166,071 
    Other borrowings  665,219   583,548   596,614   447,215   482,787 
    Subordinated notes  437,628   437,493   437,392   437,260   437,162 
    Junior subordinated debentures  253,566   253,566   253,566   253,566   253,566 
    Accrued interest payable and other liabilities  1,823,073   1,549,116   1,646,624   1,493,656   1,308,797 
    Total liabilities  49,244,264   47,858,005   48,152,811   47,744,959   46,241,709 
    Shareholders’ Equity:          
    Preferred stock  412,500   412,500   412,500   412,500   412,500 
    Common stock  61,219   61,198   60,797   60,743   60,722 
    Surplus  1,923,623   1,913,947   1,902,474   1,891,621   1,880,913 
    Treasury stock  (1,966)  (1,966)  (304)      
    Retained earnings  3,120,626   2,997,263   2,849,007   2,731,844   2,616,525 
    Accumulated other comprehensive loss  (474,090)  (367,436)  (427,636)  (458,728)  (243,037)
    Total shareholders’ equity  5,041,912   5,015,506   4,796,838   4,637,980   4,727,623 
    Total liabilities and shareholders’ equity $54,286,176  $52,873,511  $52,949,649  $52,382,939  $50,969,332 


    WINTRUST FINANCIAL
    CORPORATION AND SUBSIDIARIES
    CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

     Three Months EndedSix Months Ended
    (In thousands, except per share data)Jun 30,
    2023
     Mar 31,
    2023
     Dec 31,
    2022
     Sep 30,
    2022
     Jun 30,
    2022
    Jun 30,
    2023
     Jun 30,
    2022
    Interest income            
    Interest and fees on loans$621,057 $558,692  $498,838  $402,689  $320,501 $1,179,749  $606,199 
    Mortgage loans held-for-sale 4,178  3,528   3,997   5,371   5,740  7,706   11,827 
    Interest-bearing deposits with banks 16,882  13,468   20,349   15,621   5,790  30,350   7,477 
    Federal funds sold and securities purchased under resale agreements 1  70   1,263   1,845   1,364  71   1,795 
    Investment securities 51,243  59,943   53,092   38,569   36,541  111,186   68,939 
    Trading account securities 6  14   6   7   4  20   9 
    Federal Home Loan Bank and Federal Reserve Bank stock 3,544  3,680   2,918   2,109   1,823  7,224   3,595 
    Brokerage customer receivables 265  295   282   267   205  560   379 
    Total interest income 697,176  639,690   580,745   466,478   371,968  1,336,866   700,220 
    Interest expense            
    Interest on deposits 213,495  144,802   95,447   45,916   18,985  358,297   33,839 
    Interest on Federal Home Loan Bank advances 17,399  19,135   13,823   6,812   4,878  36,534   9,694 
    Interest on other borrowings 8,485  7,854   5,313   4,008   2,734  16,339   4,973 
    Interest on subordinated notes 5,523  5,488   5,520   5,485   5,517  11,011   10,999 
    Interest on junior subordinated debentures 4,737  4,416   3,826   2,809   2,050  9,153   3,617 
    Total interest expense 249,639  181,695   123,929   65,030   34,164  431,334   63,122 
    Net interest income 447,537  457,995   456,816   401,448   337,804  905,532   637,098 
    Provision for credit losses 28,514  23,045   47,646   6,420   20,417  51,559   24,523 
    Net interest income after provision for credit losses 419,023  434,950   409,170   395,028   317,387  853,973   612,575 
    Non-interest income            
    Wealth management 33,858  29,945   30,727   33,124   31,369  63,803   62,763 
    Mortgage banking 29,981  18,264   17,407   27,221   33,314  48,245   110,545 
    Service charges on deposit accounts 13,608  12,903   13,054   14,349   15,888  26,511   31,171 
    Gains (losses) on investment securities, net 0  1,398   (6,745)  (3,103)  (7,797) 1,398   (10,579)
    Fees from covered call options 2,578  10,391   7,956   1,366   1,069  12,969   4,811 
    Trading gains (losses), net 106  813   (306)  (7)  176  919   4,065 
    Operating lease income, net 12,227  13,046   12,384   12,644   15,007  25,273   30,482 
    Other 20,672  21,009   19,362   15,888   13,916  41,681   32,474 
    Total non-interest income 113,030  107,769   93,839   101,482   102,942  220,799   265,732 
    Non-interest expense            
    Salaries and employee benefits 184,923  176,781   180,331   176,095   167,326  361,704   339,681 
    Software and equipment 26,205  24,697   24,699   24,126   24,250  50,902   47,060 
    Operating lease equipment 9,816  9,833   10,078   9,448   8,774  19,649   18,482 
    Occupancy, net 19,176  18,486   17,763   17,727   17,651  37,662   35,475 
    Data processing 9,726  9,409   7,927   7,767   8,010  19,135   15,515 
    Advertising and marketing 17,794  11,946   14,279   16,600   16,615  29,740   28,539 
    Professional fees 8,940  8,163   9,267   7,544   7,876  17,103   16,277 
    Amortization of other acquisition-related intangible assets 1,499  1,235   1,436   1,492   1,579  2,734   3,188 
    FDIC insurance 9,008  8,669   6,775   7,186   6,949  17,677   14,678 
    OREO expenses, net 118  (207)  369   229   294  (89)  (738)
    Other 33,418  30,157   34,912   28,255   29,344  63,575   54,809 
    Total non-interest expense 320,623  299,169   307,836   296,469   288,668  619,792   572,966 
    Income before taxes 211,430  243,550   195,173   200,041   131,661  454,980   305,341 
    Income tax expense 56,680  63,352   50,356   57,080   37,148  120,032   83,437 
    Net income$154,750 $180,198  $144,817  $142,961  $94,513 $334,948  $221,904 
    Preferred stock dividends 6,991  6,991   6,991   6,991   6,991  13,982   13,982 
    Net income applicable to common shares$147,759 $173,207  $137,826  $135,970  $87,522 $320,966  $207,922 
    Net income per common share - Basic$2.41 $2.84  $2.27  $2.24  $1.51 $5.26  $3.61 
    Net income per common share - Diluted$2.38 $2.80  $2.23  $2.21  $1.49 $5.18  $3.56 
    Cash dividends declared per common share$0.40 $0.40  $0.34  $0.34  $0.34 $0.80  $0.68 
    Weighted average common shares outstanding 61,192  60,950   60,769   60,738   58,063  61,072   57,632 
    Dilutive potential common shares 902  873   1,096   837   775  933   823 
    Average common shares and dilutive common shares 62,094  61,823   61,865   61,575   58,838  62,005   58,455 


    TABLE 1
    : LOAN PORTFOLIO MIX AND GROWTH RATES

              % Growth From(1)
    (Dollars in thousands)Jun 30,
    2023
     Mar 31,
    2023
     Dec 31,
    2022
     Sep 30,
    2022
     Jun 30,
    2022
    Dec 31,
    2022(2)
     Jun 30,
    2022
    Balance:            
    Mortgage loans held-for-sale, excluding early buy-out exercised loans guaranteed by U.S. government agencies$235,570 $155,687 $156,297 $216,062 $294,688NM  (20)%
    Mortgage loans held-for-sale, early buy-out exercised loans guaranteed by U.S. government agencies 103,158  146,806  143,638  160,098  218,544(57) (53)
    Total mortgage loans held-for-sale$338,728 $302,493 $299,935 $376,160 $513,23226% (34)%
                 
    Core loans:            
    Commercial            
    Commercial and industrial$5,737,633 $5,855,035 $5,852,166 $5,818,959 $5,502,584(4)% 4%
    Asset-based lending 1,465,848  1,482,071  1,473,344  1,545,038  1,552,033(1) (6)
    Municipal 653,117  655,301  668,235  608,234  535,586(5) 22 
    Leases 1,925,767  1,904,137  1,840,928  1,582,359  1,592,3299  21 
    PPP loans 15,337  17,195  28,923  43,658  82,089(95) (81)
    Commercial real estate            
    Residential construction 51,689  69,998  76,877  66,957  55,941(66) (8)
    Commercial construction 1,409,751  1,234,762  1,102,098  1,176,407  1,145,60256  23 
    Land 298,996  292,293  307,955  282,147  304,775(6) (2)
    Office 1,404,422  1,392,040  1,337,176  1,269,729  1,321,74510  6 
    Industrial 2,002,740  1,858,088  1,836,276  1,777,658  1,746,28018  15 
    Retail 1,304,083  1,309,680  1,304,444  1,331,316  1,331,0590  (2)
    Multi-family 2,696,478  2,635,411  2,560,709  2,305,433  2,171,58311  24 
    Mixed use and other 1,440,652  1,446,806  1,425,412  1,368,537  1,330,2202  8 
    Home equity 336,974  337,016  332,698  328,822  325,8263  3 
    Residential real estate            
    Residential real estate loans for investment 2,455,392  2,309,393  2,207,595  2,086,795  1,965,05123  25 
    Residential mortgage loans, early buy-out eligible loans guaranteed by U.S. government agencies 117,024  119,301  80,701  57,161  34,76491  NM 
    Residential mortgage loans, early buy-out exercised loans guaranteed by U.S. government agencies 70,824  76,851  84,087  91,503  79,092(32) (10)
    Total core loans$23,386,727 $22,995,378 $22,519,624 $21,740,713 $21,076,5598% 11%
                 
    Niche loans:            
    Commercial            
    Franchise$1,091,164 $1,131,913 $1,169,623 $1,118,478 $1,136,929(14)% (4)%
    Mortgage warehouse lines of credit 381,043  235,684  237,392  297,374  398,085NM  (4)
    Community Advantage - homeowners association 405,042  389,922  380,875  365,967  341,09513  19 
    Insurance agency lending 925,520  905,727  897,678  879,183  906,3756  2 
    Premium Finance receivables            
    U.S. property & casualty insurance 5,900,228  5,043,486  5,103,820  4,983,795  4,781,04231  23 
    Canada property & casualty insurance 862,470  695,394  745,639  729,545  760,40532  13 
    Life insurance 8,039,273  8,125,802  8,090,998  8,004,856  7,608,433(1) 6 
    Consumer and other 31,941  42,165  50,836  47,702  44,180(75) (28)
    Total niche loans$17,636,681 $16,570,093 $16,676,861 $16,426,900 $15,976,54412% 10%
                 
    Total loans, net of unearned income$41,023,408 $39,565,471 $39,196,485 $38,167,613 $37,053,1039% 11%

    (1)   NM - Not meaningful.
    (2)   Annualized.

    TABLE 2: DEPOSIT PORTFOLIO MIX AND GROWTH RATES

              % Growth From
    (Dollars in thousands)Jun 30,
    2023
     Mar 31,
    2023
     Dec 31,
    2022
     Sep 30,
    2022
     Jun 30,
    2022
    Mar 31,
    2023(1)
     Jun 30,
    2022
    Balance:            
    Non-interest-bearing$10,604,915  $11,236,083  $12,668,160  $13,529,277  $13,855,844 (23)% (23)%
    NOW and interest-bearing demand deposits 5,814,836   5,576,558   5,591,986   5,676,122   5,918,908 17  (2)
    Wealth management deposits(2) 1,417,984   1,809,933   2,463,833   2,988,195   3,182,407 (87) (55)
    Money market 14,523,124   13,552,277   12,886,795   12,538,489   12,273,350 29  18 
    Savings 5,321,578   5,192,108   4,556,635   3,988,790   3,686,596 10  44 
    Time certificates of deposit 6,356,270   5,351,252   4,735,135   4,076,318   3,676,221 75  73 
    Total deposits$44,038,707  $42,718,211  $42,902,544  $42,797,191  $42,593,326 12% 3%
    Mix:            
    Non-interest-bearing 24%  26%  30%  32%  33%   
    NOW and interest-bearing demand deposits 13   13   13   13   13    
    Wealth management deposits(2) 3   4   5   7   7    
    Money market 33   32   30   29   29    
    Savings 12   12   11   9   9    
    Time certificates of deposit 15   13   11   10   9    
    Total deposits 100%  100%  100%  100%  100%   

    (1)   Annualized. 
    (2)   Represents deposit balances of the Company’s subsidiary banks from brokerage customers of Wintrust Investments, Chicago Deferred Exchange Company, LLC (“CDEC”), trust and asset management customers of the Company.

    TABLE 3: TIME CERTIFICATES OF DEPOSIT MATURITY/RE-PRICING ANALYSIS
    As of June 30, 2023

    (Dollars in thousands) Total Time
    Certificates of
    Deposit
     Weighted-Average
    Rate of Maturing
    Time Certificates
    of Deposit(1)
    1-3 months $1,407,470 3.15%
    4-6 months  1,323,183 2.93 
    7-9 months  1,148,928 3.53 
    10-12 months  1,543,622 4.39 
    13-18 months  595,056 3.25 
    19-24 months  250,020 2.87 
    24+ months  87,991 1.99 
    Total $6,356,270 3.46%

    (1)   Weighted-average rate excludes the impact of purchase accounting fair value adjustments.

    TABLE 4: QUARTERLY AVERAGE BALANCES

      Average Balance for three months ended,
      Jun 30, Mar 31, Dec 31, Sep 30, Jun 30,
    (In thousands)  2023   2023   2022   2022   2022 
    Interest-bearing deposits with banks, securities purchased under resale agreements and cash equivalents(1) $1,454,057  $1,235,748  $2,449,889  $3,039,907  $3,265,607 
    Investment securities(2)  7,252,582   7,956,722   7,310,383   6,655,215   6,589,947 
    FHLB and FRB stock  223,813   233,615   185,290   142,304   136,930 
    Liquidity management assets(3)  8,930,452   9,426,085   9,945,562   9,837,426   9,992,484 
    Other earning assets(3)(4)  17,401   18,445   18,585   21,805   24,059 
    Mortgage loans held-for-sale  307,683   270,966   308,639   455,342   560,707 
    Loans, net of unearned income(3)(5)  40,106,393   39,093,368   38,566,871   37,431,126   35,860,329 
    Total earning assets(3)  49,361,929   48,808,864   48,839,657   47,745,699   46,437,579 
    Allowance for loan and investment security losses  (302,627)  (282,704)  (252,827)  (260,270)  (260,547)
    Cash and due from banks  481,510   488,457   475,691   458,263   476,741 
    Other assets  3,061,141   3,060,701   3,025,097   2,779,002   2,699,653 
    Total assets $52,601,953  $52,075,318  $52,087,618  $50,722,694  $49,353,426 
               
    NOW and interest-bearing demand deposits $5,540,597  $5,271,740  $5,598,291  $5,789,368  $5,230,702 
    Wealth management deposits  1,545,626   2,167,081   2,883,247   3,078,764   2,835,267 
    Money market accounts  13,735,924   12,533,468   12,319,842   12,037,412   11,892,948 
    Savings accounts  5,206,609   4,830,322   4,403,113   3,862,579   3,882,856 
    Time deposits  5,603,024   5,041,638   4,023,232   3,675,930   3,687,778 
    Interest-bearing deposits  31,631,780   29,844,249   29,227,725   28,444,053   27,529,551 
    Federal Home Loan Bank advances  2,227,106   2,474,882   2,088,201   1,403,573   1,197,390 
    Other borrowings  625,757   602,937   480,553   478,909   489,779 
    Subordinated notes  437,545   437,422   437,312   437,191   437,084 
    Junior subordinated debentures  253,566   253,566   253,566   253,566   253,566 
    Total interest-bearing liabilities  35,175,754   33,613,056   32,487,357   31,017,292   29,907,370 
    Non-interest-bearing deposits  10,908,022   12,171,631   13,404,036   13,731,219   13,805,128 
    Other liabilities  1,473,459   1,395,360   1,485,369   1,178,796   1,114,818 
    Equity  5,044,718   4,895,271   4,710,856   4,795,387   4,526,110 
    Total liabilities and shareholders’ equity $52,601,953  $52,075,318  $52,087,618  $50,722,694  $49,353,426 
               
    Net free funds/contribution (6) $14,186,175  $15,195,808  $16,352,300  $16,728,407  $16,530,209 

    (1)   Includes interest-bearing deposits from banks and securities purchased under resale agreements with original maturities of greater than three months. Cash equivalents include federal funds sold and securities purchased under resale agreements with original maturities of three months or less.
    (2)   Investment securities includes investment securities classified as available-for-sale and held-to-maturity, and equity securities with readily determinable fair values. Equity securities without readily determinable fair values are included within other assets.
    (3)   See Table 17: Supplemental Non-GAAP Financial Measures/Ratios for additional information on this performance measure/ratio.
    (4)   Other earning assets include brokerage customer receivables and trading account securities.
    (5)   Loans, net of unearned income, include non-accrual loans.
    (6)   Net free funds are the difference between total average earning assets and total average interest-bearing liabilities. The estimated contribution to net interest margin from net free funds is calculated using the rate paid for total interest-bearing liabilities.

    TABLE 5: QUARTERLY NET INTEREST INCOME

      Net Interest Income for three months ended,
      Jun 30, Mar 31, Dec 31, Sep 30, Jun 30,
    (In thousands)  2023   2023   2022   2022   2022 
    Interest income:          
    Interest-bearing deposits with banks, securities purchased under resale agreements and cash equivalents $16,882  $13,538  $21,612  $17,466  $7,154 
    Investment securities  51,795   60,494   53,630   39,071   37,013 
    FHLB and FRB stock  3,544   3,680   2,918   2,109   1,823 
    Liquidity management assets(1)  72,221   77,712   78,160   58,646   45,990 
    Other earning assets(1)  272   313   289   275   210 
    Mortgage loans held-for-sale  4,178   3,528   3,997   5,371   5,740 
    Loans, net of unearned income(1)  622,939   560,564   500,432   403,719   321,069 
    Total interest income $699,610  $642,117  $582,878  $468,011  $373,009 
               
    Interest expense:          
    NOW and interest-bearing demand deposits $29,178  $18,772  $14,982  $8,041  $2,553 
    Wealth management deposits  9,097   12,258   14,079   11,068   3,685 
    Money market accounts  106,630   68,276   45,468   18,916   8,559 
    Savings accounts  25,603   15,816   8,421   2,130   347 
    Time deposits  42,987   29,680   12,497   5,761   3,841 
    Interest-bearing deposits  213,495   144,802   95,447   45,916   18,985 
    Federal Home Loan Bank advances  17,399   19,135   13,823   6,812   4,878 
    Other borrowings  8,485   7,854   5,313   4,008   2,734 
    Subordinated notes  5,523   5,488   5,520   5,485   5,517 
    Junior subordinated debentures  4,737   4,416   3,826   2,809   2,050 
    Total interest expense $249,639  $181,695  $123,929  $65,030  $34,164 
               
    Less: Fully taxable-equivalent adjustment  (2,434)  (2,427)  (2,133)  (1,533)  (1,041)
    Net interest income (GAAP)(2)  447,537   457,995   456,816   401,448   337,804 
    Fully taxable-equivalent adjustment  2,434   2,427   2,133   1,533   1,041 
    Net interest income, fully taxable-equivalent (non-GAAP)(2) $449,971  $460,422  $458,949  $402,981  $338,845 

    (1)   Interest income on tax-advantaged loans, trading securities and investment securities reflects a taxable-equivalent adjustment based on the marginal federal corporate tax rate in effect as of the applicable period.
    (2)   See Table 17: Supplemental Non-GAAP Financial Measures/Ratios for additional information on this performance measure/ratio.

    TABLE 6: QUARTERLY NET INTEREST MARGIN

      Net Interest Margin for three months ended,
      Jun 30,
    2023
     Mar 31,
    2023
     Dec 31,
    2022
     Sep 30,
    2022
     Jun 30,
    2022
    Yield earned on:          
    Interest-bearing deposits with banks, securities purchased under resale agreements and cash equivalents 4.66% 4.44% 3.50% 2.28% 0.88%
    Investment securities 2.86  3.08  2.91  2.33  2.25 
    FHLB and FRB stock 6.35  6.39  6.25  5.88  5.34 
    Liquidity management assets 3.24  3.34  3.12  2.37  1.85 
    Other earning assets 6.27  6.87  6.17  5.01  3.49 
    Mortgage loans held-for-sale 5.45  5.28  5.14  4.68  4.11 
    Loans, net of unearned income 6.23  5.82  5.15  4.28  3.59 
    Total earning assets 5.68% 5.34% 4.73% 3.89% 3.22%
               
    Rate paid on:          
    NOW and interest-bearing demand deposits 2.11% 1.44% 1.06% 0.55% 0.20%
    Wealth management deposits 2.36  2.29  1.94  1.43  0.52 
    Money market accounts 3.11  2.21  1.46  0.62  0.29 
    Savings accounts 1.97  1.33  0.76  0.22  0.04 
    Time deposits 3.08  2.39  1.23  0.62  0.42 
    Interest-bearing deposits 2.71  1.97  1.30  0.64  0.28 
    Federal Home Loan Bank advances 3.13  3.14  2.63  1.93  1.63 
    Other borrowings 5.44  5.28  4.39  3.32  2.24 
    Subordinated notes 5.06  5.02  5.05  5.02  5.05 
    Junior subordinated debentures 7.49  6.97  5.90  4.33  3.20 
    Total interest-bearing liabilities 2.85% 2.19% 1.51% 0.83% 0.46%
               
    Interest rate spread(1)(2) 2.83% 3.15% 3.22% 3.06% 2.76%
    Less: Fully taxable-equivalent adjustment (0.02) (0.02) (0.02) (0.01) (0.01)
    Net free funds/contribution(3) 0.83  0.68  0.51  0.29  0.17 
    Net interest margin (GAAP)(2) 3.64% 3.81% 3.71% 3.34% 2.92%
    Fully taxable-equivalent adjustment 0.02  0.02  0.02  0.01  0.01 
    Net interest margin, fully taxable-equivalent (non-GAAP)(2) 3.66% 3.83% 3.73% 3.35% 2.93%

    (1)   Interest rate spread is the difference between the yield earned on earning assets and the rate paid on interest-bearing liabilities.
    (2)   See Table 17: Supplemental Non-GAAP Financial Measures/Ratios for additional information on this performance measure/ratio.
    (3)   Net free funds are the difference between total average earning assets and total average interest-bearing liabilities. The estimated contribution to net interest margin from net free funds is calculated using the rate paid for total interest-bearing liabilities.

    TABLE 7: YEAR-TO-DATE AVERAGE BALANCES, AND NET INTEREST INCOME AND MARGIN

     Average Balance
    for six months ended,
    Interest
    for six months ended,
    Yield/Rate
    for six months ended,
    (Dollars in thousands)Jun 30,
    2023
     Jun 30,
    2022
    Jun 30,
    2023
     Jun 30,
    2022
    Jun 30,
    2023
     Jun 30,
    2022
    Interest-bearing deposits with banks, securities purchased under resale agreements and cash equivalents(1)$1,345,506  $3,911,080 $30,421  $9,272 4.56% 0.48%
    Investment securities(2) 7,602,707   6,484,570  112,288   69,876 2.98  2.17 
    FHLB and FRB stock 228,687   136,424  7,224   3,595 6.37  5.31 
    Liquidity management assets(3)(4)$9,176,900  $10,532,074 $149,933  $82,743 3.29% 1.58%
    Other earning assets(3)(4)(5) 17,920   24,622  585   391 6.58  3.20 
    Mortgage loans held-for-sale 289,426   612,078  7,706   11,827 5.37  3.90 
    Loans, net of unearned income(3)(4)(6) 39,602,672   35,348,269  1,183,503   607,194 6.03  3.46 
    Total earning assets(4)$49,086,918  $46,517,043 $1,341,727  $702,155 5.51% 3.04%
    Allowance for loan and investment security losses (292,721)  (256,834)      
    Cash and due from banks 484,964   479,174       
    Other assets 3,060,929   2,687,842       
    Total assets$52,340,090  $49,427,225       
              
    NOW and interest-bearing demand deposits$5,406,911  $5,010,709 $47,949  $4,543 1.79% 0.18%
    Wealth management deposits 1,854,637   2,671,444  21,355   4,603 2.32  0.35 
    Money market accounts 13,138,018   12,330,943  174,907   16,207 2.68  0.27 
    Savings accounts 5,019,505   3,893,519  41,419   683 1.66  0.04 
    Time deposits 5,323,882   3,774,095  72,667   7,803 2.75  0.42 
    Interest-bearing deposits$30,742,953  $27,680,710 $358,297  $33,839 2.35% 0.25%
    Federal Home Loan Bank advances 2,350,309   1,219,110  36,534   9,694 3.13  1.60 
    Other borrowings 614,410   492,011  16,338   4,973 5.36  2.04 
    Subordinated notes 437,484   437,025  11,011   10,999 5.08  5.03 
    Junior subordinated debentures 253,566   253,566  9,154   3,617 7.28  2.84 
    Total interest-bearing liabilities$34,398,722  $30,082,422 $431,334  $63,122 2.53% 0.42%
    Non-interest-bearing deposits 11,536,336   13,769,792       
    Other liabilities 1,434,625   1,061,655       
    Equity 4,970,407   4,513,356       
    Total liabilities and shareholders’ equity$52,340,090  $49,427,225       
    Interest rate spread(4)(7)      2.98% 2.62%
    Less: Fully taxable-equivalent adjustment    (4,861)  (1,935)(0.02) (0.01)
    Net free funds/contribution(8)$14,688,196  $16,434,621    0.76  0.15 
    Net interest income/margin (GAAP)(4)   $905,532  $637,098 3.72% 2.76%
    Fully taxable-equivalent adjustment    4,861   1,935 0.02  0.01 
    Net interest income/margin, fully taxable-equivalent (non-GAAP)(4)   $910,393  $639,033 3.74% 2.77%

    (1)   Includes interest-bearing deposits from banks and securities purchased under resale agreements with original maturities of greater than three months. Cash equivalents include federal funds sold and securities purchased under resale agreements with original maturities of three months or less.
    (2)   Investment securities includes investment securities classified as available-for-sale and held-to-maturity, and equity securities with readily determinable fair values. Equity securities without readily determinable fair values are included within other assets.
    (3)   Interest income on tax-advantaged loans, trading securities and investment securities reflects a taxable-equivalent adjustment based on the marginal federal corporate tax rate in effect as of the applicable period.
    (4)   See Table 17: Supplemental Non-GAAP Financial Measures/Ratios for additional information on this performance measure/ratio.
    (5)   Other earning assets include brokerage customer receivables and trading account securities.
    (6)   Loans, net of unearned income, include non-accrual loans.
    (7)   Interest rate spread is the difference between the yield earned on earning assets and the rate paid on interest-bearing liabilities.
    (8)   Net free funds are the difference between total average earning assets and total average interest-bearing liabilities. The estimated contribution to net interest margin from net free funds is calculated using the rate paid for total interest-bearing liabilities.

    TABLE 8: INTEREST RATE SENSITIVITY

    As an ongoing part of its financial strategy, the Company attempts to manage the impact of fluctuations in market interest rates on net interest income. Management measures its exposure to changes in interest rates by modeling many different interest rate scenarios.

    The following interest rate scenarios display the percentage change in net interest income over a one-year time horizon assuming increases and decreases of 100 and 200 basis points. The Static Shock Scenario results incorporate actual cash flows and repricing characteristics for balance sheet instruments following an instantaneous, parallel change in market rates based upon a static (i.e. no growth or constant) balance sheet. Conversely, the Ramp Scenario results incorporate management’s projections of future volume and pricing of each of the product lines following a gradual, parallel change in market rates over twelve months. Actual results may differ from these simulated results due to timing, magnitude, and frequency of interest rate changes as well as changes in market conditions and management strategies. The interest rate sensitivity for both the Static Shock and Ramp Scenario is as follows:

    Static Shock Scenario +200 Basis
    Points
     +100 Basis
    Points
     -100 Basis
    Points
     -200 Basis
    Points
    Jun 30, 2023 5.7% 2.9% (2.9)% (7.9)%
    Mar 31, 2023 4.2  2.4  (2.4) (7.3)
    Dec 31, 2022 7.2  3.8  (5.0) (12.1)
    Sep 30, 2022 12.9  7.1  (8.7) (18.9)
    Jun 30, 2022 17.0  9.0  (12.6) (23.8)

     

    Ramp Scenario+200 Basis
    Points
     +100 Basis
    Points
     -100 Basis
    Points
     -200 Basis
    Points
    Jun 30, 20232.9% 1.8% (0.9)% (3.4)%
    Mar 31, 20233.0  1.7  (1.3) (3.4)
    Dec 31, 20225.6  3.0  (2.9) (6.8)
    Sep 30, 20226.5  3.6  (3.9) (8.6)
    Jun 30, 202210.2  5.3  (6.9) (14.3)

    As shown above, the magnitude of potential changes in net interest income in various interest rate scenarios has continued to diminish. Given the recent unprecedented rise in interest rates, the Company has made a conscious effort to reposition its exposure to changing interest rates given the uncertainty of the future interest rate environment. To this end, management has executed various derivative instruments including collars and receive fixed swaps to hedge variable rate loan exposures and originated a higher percentage of its loan originations in longer term fixed rate loans. The Company will continue to monitor current and projected interest rates and expects to execute additional derivatives to mitigate potential fluctuations in the net interest margin in future years.

    TABLE 9: MATURITIES AND SENSITIVITIES TO CHANGES IN INTEREST RATES

     Loans repricing or maturity period
    As of June 30, 2023One year or
    less
     From one to
    five years
     From five to
    fifteen years
     After fifteen
    years
     Total
    (In thousands)    
    Commercial         
    Fixed rate$491,950 $2,588,577 $1,707,423 $11,360 $4,799,310
    Variable rate 7,799,656  1,505      7,801,161
    Total commercial$8,291,606 $2,590,082 $1,707,423 $11,360 $12,600,471
    Commercial real estate         
    Fixed rate 580,938  2,884,383  573,579  51,683  4,090,583
    Variable rate 6,509,558  8,631  39    6,518,228
    Total commercial real estate$7,090,496 $2,893,014 $573,618 $51,683 $10,608,811
    Home equity         
    Fixed rate 11,132  2,682    31  13,845
    Variable rate 323,129        323,129
    Total home equity$334,261 $2,682 $ $31 $336,974
    Residential real estate         
    Fixed rate 16,724  3,824  30,511  1,072,690  1,123,749
    Variable rate 73,672  263,888  1,181,931    1,519,491
    Total residential real estate$90,396 $267,712 $1,212,442 $1,072,690 $2,643,240
    Premium finance receivables - property & casualty         
    Fixed rate 6,657,042  105,656      6,762,698
    Variable rate         
    Total premium finance receivables - property & casualty$6,657,042 $105,656 $ $ $6,762,698
    Premium finance receivables - life insurance         
    Fixed rate 121,092  547,337  22,242    690,671
    Variable rate 7,348,602        7,348,602
    Total premium finance receivables - life insurance$7,469,694 $547,337 $22,242 $ $8,039,273
    Consumer and other         
    Fixed rate 4,420  3,912  60  301  8,693
    Variable rate 23,248        23,248
    Total consumer and other$27,668 $3,912 $60 $301 $31,941
              
    Total per category         
    Fixed rate 7,883,298  6,136,371  2,333,815  1,136,065  17,489,549
    Variable rate 22,077,865  274,024  1,181,970    23,533,859
    Total loans, net of unearned income$29,961,163 $6,410,395 $3,515,785 $1,136,065 $41,023,408
              
    Variable Rate Loan Pricing by Index:         
    SOFR tenors        $10,407,621
    One- year CMT         5,819,451
    One- month LIBOR         1,707,349
    Three- month LIBOR         10,276
    Twelve- month LIBOR         1,028,904
    Prime         3,932,654
    Ameribor tenors         356,300
    Other U.S. Treasury tenors         46,387
    BSBY tenors         49,436
    Other         175,481
    Total variable rate        $23,533,859

    SOFR - Secured Overnight Financing Rate.
    CMT - Constant Maturity Treasury Rate.
    LIBOR - London Interbank Offered Rate.
    Ameribor - American Interbank Offered Rate.
    BSBY - Bloomberg Short Term Bank Yield Index.

    Graph available at the following link: 
    http://ml.globenewswire.com/Resource/Download/b5ad0e3b-b9cd-4f50-9166-ef49f007ca12

    Source: Bloomberg

    As noted in the table on the previous page, the majority of the Company’s portfolio is tied to SOFR, CMT and LIBOR indices which, as shown in the table above, do not mirror the same changes as the Prime rate which has historically moved when the Federal Reserve raises or lowers interest rates. Specifically, the Company has variable rate loans of $7.8 billion tied to one-month SOFR, $5.8 billion tied to one-year CMT and $1.7 billion tied to one-month LIBOR. The above chart shows:

      Basis Point (bp) Change in
      1-month
    SOFR
     1-year
    CMT
     1-month
    LIBOR
     Prime 
    Second Quarter 2023 34bps76bps36bps25bps
    First Quarter 2023 44 -9 47 50 
    Fourth Quarter 2022 132 68 125 125 
    Third Quarter 2022 135 125 135 150 
    Second Quarter 2022 139 117 134 125 


    TABLE 10
    : ALLOWANCE FOR CREDIT LOSSES

      Three Months EndedSix Months Ended
      Jun 30, Mar 31, Dec 31, Sep 30, Jun 30,Jun 30, Jun 30,
    (Dollars in thousands)  2023   2023   2022   2022   2022  2023   2022 
    Allowance for credit losses at beginning of period $376,261  $357,936  $315,338  $312,192  $301,327 $357,936  $299,731 
    Cumulative effect adjustment from the adoption of ASU 2022-02     741           741    
    Provision for credit losses  28,514   23,045   47,646   6,420   20,417  51,559   24,523 
    Other adjustments  41   4   31   (105)  (56) 45   (34)
    Charge-offs:             
    Commercial  5,629   2,543   3,019   780   8,928  8,172   10,342 
    Commercial real estate  8,124   5   538   24   40  8,129   817 
    Home equity           43   192     389 
    Residential real estate           5        466 
    Premium finance receivables - property & casualty  4,519   4,629   3,629   6,037   2,903  9,148   4,574 
    Premium finance receivables - life insurance  134   21   28        155   7 
    Consumer and other  110   153      635   253  263   446 
    Total charge-offs  18,516   7,351   7,214   7,524   12,316  25,867   17,041 
    Recoveries:             
    Commercial  505   392   691   2,523   996  897   1,534 
    Commercial real estate  25   100   61   55   553  125   585 
    Home equity  37   35   65   38   123  72   216 
    Residential real estate  6   4   6   60   6  10   11 
    Premium finance receivables - property & casualty  890   1,314   1,279   1,648   1,119  2,204   2,595 
    Premium finance receivables - life insurance     9           9    
    Consumer and other  23   32   33   31   23  55   72 
    Total recoveries  1,486   1,886   2,135   4,355   2,820  3,372   5,013 
    Net charge-offs  (17,030)  (5,465)  (5,079)  (3,169)  (9,496) (22,495)  (12,028)
    Allowance for credit losses at period end $387,786  $376,261  $357,936  $315,338  $312,192 $387,786  $312,192 
                  
    Annualized net charge-offs (recoveries) by category as a percentage of its own respective category’s average:   
    Commercial  0.16%  0.07%  0.08%  (0.06)%  0.27% 0.12%  0.15%
    Commercial real estate  0.31   0.00   0.02   0.00   (0.02) 0.16   0.01 
    Home equity  (0.04)  (0.04)  (0.08)  0.01   0.09  (0.04)  0.11 
    Residential real estate  0.00   0.00   0.00   (0.01)  0.00  0.00   0.05 
    Premium finance receivables - property & casualty  0.24   0.23   0.16   0.30   0.14  0.24   0.02 
    Premium finance receivables - life insurance  0.01   0.00   0.00        0.00   0.00 
    Consumer and other  0.45   0.74   (0.16)  4.02   1.31  0.58   1.26 
    Total loans, net of unearned income  0.17%  0.06%  0.05%  0.03%  0.11% 0.11%  0.07%
                  
    Loans at period end $41,023,408  $39,565,471  $39,196,485  $38,167,613  $37,053,103    
    Allowance for loan losses as a percentage of loans at period end  0.74%  0.73%  0.69%  0.64%  0.68%   
    Allowance for loan and unfunded lending-related commitment losses as a percentage of loans at period end  0.94   0.95   0.91   0.83   0.84    


    TABLE 11
    : ALLOWANCE AND PROVISION FOR CREDIT LOSSES BY COMPONENT

      Three Months EndedSix Months Ended
      Jun 30, Mar 31, Dec 31, Sep 30, Jun 30,Jun 30, Jun 30,
    (In thousands)  2023   2023   2022  2022   2022  2023   2022
    Provision for loan losses $31,516  $22,520  $29,110 $(2,385) $10,782 $54,036  $15,996
    Provision for unfunded lending-related commitments losses  (2,945)  550   18,358  8,578   9,711  (2,395)  8,522
    Provision for held-to-maturity securities losses  (57)  (25)  178  227   (76) (82)  5
    Provision for credit losses $28,514  $23,045  $47,646 $6,420  $20,417 $51,559  $24,523
                  
    Allowance for loan losses $302,499  $287,972  $270,173 $246,110  $251,769    
    Allowance for unfunded lending-related commitments losses  84,881   87,826   87,275  68,918   60,340    
    Allowance for loan losses and unfunded lending-related commitments losses  387,380   375,798   357,448  315,028   312,109    
    Allowance for held-to-maturity securities losses  406   463   488  310   83    
    Allowance for credit losses $387,786  $376,261  $357,936 $315,338  $312,192    


    TABLE 12
    : ALLOWANCE BY LOAN PORTFOLIO

    The table below summarizes the calculation of allowance for loan losses and allowance for unfunded lending-related commitments losses for the Company’s loan portfolios as well as core and niche portfolios, as of June 30, 2023, March 31, 2023 and December 31, 2022.

     As of Jun 30, 2023As of Mar 31, 2023As of Dec 31, 2022
    (Dollars in thousands)Recorded
    Investment
     Calculated
    Allowance
     % of its
    category’s
    balance
    Recorded
    Investment
     Calculated
    Allowance
     % of its
    category’s
    balance
    Recorded
    Investment
     Calculated
    Allowance
     % of its
    category’s
    balance
    Commercial:               
    Commercial, industrial and other$12,600,471 $143,142 1.14%$12,576,985 $149,501 1.19%$12,549,164 $142,769 1.14%
    Commercial real estate:               
    Construction and development 1,760,436  86,725 4.93  1,597,053  75,069 4.70  1,486,930  75,907 5.10 
    Non-construction 8,848,375  128,971 1.46  8,642,025  119,711 1.39  8,464,017  108,445 1.28 
    Home equity 336,974  6,967 2.07  337,016  7,728 2.29  332,698  7,573 2.28 
    Residential real estate 2,643,240  12,252 0.46  2,505,545  11,434 0.46  2,372,383  11,585 0.49 
    Premium finance receivables               
    Commercial insurance loans 6,762,698  8,347 0.12  5,738,880  11,248 0.20  5,849,459  9,967 0.17 
    Life insurance loans 8,039,273  699 0.01  8,125,802  707 0.01  8,090,998  704 0.01 
    Consumer and other 31,941  277 0.87  42,165  400 0.95  50,836  498 0.98 
    Total loans, net of unearned income$41,023,408 $387,380 0.94%$39,565,471 $375,798 0.95%$39,196,485 $357,448 0.91%
                    
    Total core loans(1)$23,386,727 $350,930 1.50%$22,995,378 $334,910 1.46%$22,519,624 $320,403 1.42%
    Total niche loans(1) 17,636,681  36,450 0.21  16,570,093  40,888 0.25  16,676,861  37,045 0.22 
                    

    (1)   See Table 1 for additional detail on core and niche loans.

    TABLE 13: LOAN PORTFOLIO AGING

    (In thousands) Jun 30, 2023 Mar 31, 2023 Dec 31, 2022 Sep 30, 2022 Jun 30, 2022
    Loan Balances:          
    Commercial          
    Nonaccrual $40,460 $47,950 $35,579 $44,293 $32,436
    90+ days and still accruing  573    462  237  
    60-89 days past due  22,808  10,755  21,128  24,641  16,789
    30-59 days past due  48,970  95,593  56,696  34,917  14,120
    Current  12,487,660  12,422,687  12,435,299  12,155,162  11,983,760
    Total commercial $12,600,471 $12,576,985 $12,549,164 $12,259,250 $12,047,105
    Commercial real estate          
    Nonaccrual $18,483 $11,196 $6,387 $10,477 $10,718
    90+ days and still accruing          
    60-89 days past due  1,054  20,539  2,244  6,041  6,771
    30-59 days past due  14,218  72,680  30,675  29,971  34,220
    Current  10,575,056  10,134,663  9,911,641  9,531,695  9,355,496
    Total commercial real estate $10,608,811 $10,239,078 $9,950,947 $9,578,184 $9,407,205
    Home equity          
    Nonaccrual $1,361 $1,190 $1,487 $1,320 $1,084
    90+ days and still accruing  110        
    60-89 days past due  316  116    125  154
    30-59 days past due  601  1,118  2,152  848  930
    Current  334,586  334,592  329,059  326,529  323,658
    Total home equity $336,974 $337,016 $332,698 $328,822 $325,826
    Residential real estate          
    Early buy-out loans guaranteed by U.S. government agencies(1) $187,848 $196,152 $164,788 $148,664 $113,856
    Nonaccrual  13,652  11,333  10,171  9,787  8,330
    90+ days and still accruing    104      
    60-89 days past due  7,243  74  4,364  2,149  534
    30-59 days past due  872  19,183  9,982  15  147
    Current  2,433,625  2,278,699  2,183,078  2,074,844  1,956,040
    Total residential real estate $2,643,240 $2,505,545 $2,372,383 $2,235,459 $2,078,907
    Premium finance receivables - property & casualty          
    Nonaccrual $19,583 $18,543 $13,470 $13,026 $13,303
    90+ days and still accruing  12,785  9,215  15,841  16,624  6,447
    60-89 days past due  22,670  14,287  14,926  15,301  15,299
    30-59 days past due  32,751  32,545  40,557  21,128  23,313
    Current  6,674,909  5,664,290  5,764,665  5,647,261  5,483,085
    Total Premium finance receivables - property & casualty $6,762,698 $5,738,880 $5,849,459 $5,713,340 $5,541,447
    Premium finance receivables - life insurance          
    Nonaccrual $6 $ $ $ $
    90+ days and still accruing  1,667  1,066  17,245  1,831  
    60-89 days past due  3,729  21,552  5,260  13,628  1,796
    30-59 days past due  90,117  52,975  68,725  44,954  65,155
    Current  7,943,754  8,050,209  7,999,768  7,944,443  7,541,482
    Total Premium finance receivables - life insurance $8,039,273 $8,125,802 $8,090,998 $8,004,856 $7,608,433
    Consumer and other          
    Nonaccrual $4 $6 $6 $7 $8
    90+ days and still accruing  28  87  49  31  25
    60-89 days past due  51  10  18  26  8
    30-59 days past due  146  379  224  343  119
    Current  31,712  41,683  50,539  47,295  44,020
    Total consumer and other $31,941 $42,165 $50,836 $47,702 $44,180
    Total loans, net of unearned income          
    Early buy-out loans guaranteed by U.S. government agencies(1) $187,848 $196,152 $164,788 $148,664 $113,856
    Nonaccrual  93,549  90,218  67,100  78,910  65,879
    90+ days and still accruing  15,163  10,472  33,597  18,723  6,472
    60-89 days past due  57,871  67,333  47,940  61,911  41,351
    30-59 days past due  187,675  274,473  209,011  132,176  138,004
    Current  40,481,302  38,926,823  38,674,049  37,727,229  36,687,541
    Total loans, net of unearned income $41,023,408 $39,565,471 $39,196,485 $38,167,613 $37,053,103

    (1)   Early buy-out loans are insured or guaranteed by the Federal Housing Administration or the U.S. Department of Veterans Affairs, subject to indemnifications and insurance limits for certain loans.  

    TABLE 14: NON-PERFORMING ASSETS(1)

     Jun 30, Mar 31, Dec 31, Sep 30, Jun 30,
    (Dollars in thousands) 2023   2023   2022   2022   2022 
    Loans past due greater than 90 days and still accruing:         
    Commercial$573  $  $462  $237  $ 
    Commercial real estate              
    Home equity 110             
    Residential real estate    104          
    Premium finance receivables - property & casualty 12,785   9,215   15,841   16,624   6,447 
    Premium finance receivables - life insurance 1,667   1,066   17,245   1,831    
    Consumer and other 28   87   49   31   25 
    Total loans past due greater than 90 days and still accruing 15,163   10,472   33,597   18,723   6,472 
    Non-accrual loans:         
    Commercial 40,460   47,950   35,579   44,293   32,436 
    Commercial real estate 18,483   11,196   6,387   10,477   10,718 
    Home equity 1,361   1,190   1,487   1,320   1,084 
    Residential real estate 13,652   11,333   10,171   9,787   8,330 
    Premium finance receivables - property & casualty 19,583   18,543   13,470   13,026   13,303 
    Premium finance receivables - life insurance 6             
    Consumer and other 4   6   6   7   8 
    Total non-accrual loans 93,549   90,218   67,100   78,910   65,879 
    Total non-performing loans:         
    Commercial 41,033   47,950   36,041   44,530   32,436 
    Commercial real estate 18,483   11,196   6,387   10,477   10,718 
    Home equity 1,471   1,190   1,487   1,320   1,084 
    Residential real estate 13,652   11,437   10,171   9,787   8,330 
    Premium finance receivables - property & casualty 32,368   27,758   29,311   29,650   19,750 
    Premium finance receivables - life insurance 1,673   1,066   17,245   1,831    
    Consumer and other 32   93   55   38   33 
    Total non-performing loans$108,712  $100,690  $100,697  $97,633  $72,351 
    Other real estate owned 10,275   8,050   8,589   5,376   5,574 
    Other real estate owned - from acquisitions 1,311   1,311   1,311   1,311   1,265 
    Other repossessed assets              
    Total non-performing assets$120,298  $110,051  $110,597  $104,320  $79,190 
    Total non-performing loans by category as a percent of its own respective category’s period-end balance:         
    Commercial 0.33%  0.38%  0.29%  0.36%  0.27%
    Commercial real estate 0.17   0.11   0.06   0.11   0.11 
    Home equity 0.44   0.35   0.45   0.40   0.33 
    Residential real estate 0.52   0.46   0.43   0.44   0.40 
    Premium finance receivables - property & casualty 0.48   0.48   0.50   0.52   0.36 
    Premium finance receivables - life insurance 0.02   0.01   0.21   0.02    
    Consumer and other 0.10   0.22   0.11   0.08   0.07 
    Total loans, net of unearned income 0.26%  0.25%  0.26%  0.26%  0.20%
    Total non-performing assets as a percentage of total assets 0.22%  0.21%  0.21%  0.20%  0.16%
    Allowance for loan losses and unfunded lending-related commitments losses as a percentage of non-accrual loans 414.09%  416.54%  532.71%  399.22%  473.76%
              

    (1)   Excludes early buy-out loans guaranteed by U.S. government agencies. Early buy-out loans are insured or guaranteed by the Federal Housing Administration or the U.S. Department of Veterans Affairs, subject to indemnifications and insurance limits for certain loans.

    Non-performing Loans Rollforward, excluding early buy-out loans guaranteed by U.S. government agencies

     Three Months EndedSix Months Ended
     Jun 30, Mar 31, Dec 31, Sep 30, Jun 30,Jun 30, Jun 30,
    (In thousands) 2023   2023   2022   2022   2022  2023   2022 
                 
    Balance at beginning of period$100,690  $100,697  $97,633  $72,351  $57,305 $100,697  $74,438 
    Additions from becoming non-performing in the respective period 21,246   24,455   10,027   35,234   22,841  45,701   26,982 
    Return to performing status (360)  (480)  (1,167)  (154)  (1,000) (840)  (1,729)
    Payments received (12,314)  (5,261)  (16,351)  (20,417)  (4,029) (17,575)  (24,168)
    Transfer to OREO and other repossessed assets (2,958)     (3,365)  (185)  (1,611) (2,958)  (5,988)
    Charge-offs, net (2,696)  (1,159)  (1,363)  (341)  (1,969) (3,855)  (4,323)
    Net change for niche loans(1) 5,104   (17,562)  15,283   11,145   814  (12,458)  7,139 
    Balance at end of period$108,712  $100,690  $100,697  $97,633  $72,351 $108,712  $72,351 

    (1)   Includes activity for premium finance receivables and indirect consumer loans.

    Other Real Estate Owned

     Three Months Ended
     Jun 30, Mar 31, Dec 31, Sep 30, Jun 30,
    (In thousands) 2023   2023   2022   2022   2022 
    Balance at beginning of period$9,361  $9,900  $6,687  $6,839  $6,203 
    Disposals/resolved (733)  (435)  (152)  (133)  (1,172)
    Transfers in at fair value, less costs to sell 2,958      3,365   134   2,090 
    Fair value adjustments    (104)     (153)  (282)
    Balance at end of period$11,586  $9,361  $9,900  $6,687  $6,839 
              
     Period End
     Jun 30, Mar 31, Dec 31, Sep 30, Jun 30,
    Balance by Property Type: 2023   2023   2022   2022   2022 
    Residential real estate$318  $1,051  $1,585  $1,585  $1,630 
    Residential real estate development             133 
    Commercial real estate 11,268   8,310   8,315   5,102   5,076 
    Total$11,586  $9,361  $9,900  $6,687  $6,839 


    TABLE 15: NON-INTEREST INCOME

     Three Months Ended Q2 2023 compared to
    Q1 2023
     Q2 2023 compared to
    Q2 2022
     Jun 30, Mar 31, Dec 31, Sep 30, Jun 30,  
    (Dollars in thousands)2023  2023   2022   2022   2022  $ Change % Change $ Change % Change
    Brokerage$4,404 $4,533  $4,177  $4,587  $4,272  $(129) (3)% $132  3%
    Trust and asset management 29,454  25,412   26,550   28,537   27,097   4,042  16   2,357  9 
    Total wealth management 33,858  29,945   30,727   33,124   31,369   3,913  13   2,489  8 
    Mortgage banking 29,981  18,264   17,407   27,221   33,314   11,717  64   (3,333) (10)
    Service charges on deposit accounts 13,608  12,903   13,054   14,349   15,888   705  5   (2,280) (14)
    Gains (losses) on investment securities, net 0  1,398   (6,745)  (3,103)  (7,797)  (1,398) (100)  7,797  (100)
    Fees from covered call options 2,578  10,391   7,956   1,366   1,069   (7,813) (75)  1,509  NM 
    Trading gains (losses), net 106  813   (306)  (7)  176   (707) (87)  (70) (40)
    Operating lease income, net 12,227  13,046   12,384   12,644   15,007   (819) (6)  (2,780) (19)
    Other:                 
    Interest rate swap fees 2,711  2,606   2,319   1,997   3,300   105  4   (589) (18)
    BOLI 1,322  1,351   1,394   248   (884)  (29) (2)  2,206  NM 
    Administrative services 1,319  1,615   1,736   1,533   1,591   (296) (18)  (272) (17)
    Foreign currency remeasurement gains (losses) 543  (188)  277   (93)  97   731  NM   446  NM 
    Early pay-offs of capital leases 201  365   131   138   160   (164) (45)  41  26 
    Miscellaneous 14,576  15,260   13,505   12,065   9,652   (684) (4)  4,924  51 
    Total Other 20,672  21,009   19,362   15,888   13,916   (337) (2)  6,756  49 
    Total Non-Interest Income$113,030 $107,769  $93,839  $101,482  $102,942  $5,261  5% $10,088  10%

     

     Six Months Ended    
     Jun 30, Jun 30, $ %
    (Dollars in thousands) 2023  2022  Change Change
    Brokerage$8,937 $8,904  $33  0%
    Trust and asset management 54,866  53,859   1,007  2 
    Total wealth management 63,803  62,763   1,040  2 
    Mortgage banking 48,245  110,545   (62,300) (56)
    Service charges on deposit accounts 26,511  31,171   (4,660) (15)
    Gains (losses) on investment securities, net 1,398  (10,579)  11,977  NM 
    Fees from covered call options 12,969  4,811   8,158  NM 
    Trading gains, net 919  4,065   (3,146) (77)
    Operating lease income, net 25,273  30,482   (5,209) (17)
    Other:       
    Interest rate swap fees 5,317  7,869   (2,552) (32)
    BOLI 2,673  (836)  3,509  NM 
    Administrative services 2,934  3,444   (510) (15)
    Foreign currency remeasurement gains 355  108   247  NM 
    Early pay-offs of leases 566  425   141  33 
    Miscellaneous 29,836  21,464   8,372  39 
    Total Other 41,681  32,474   9,207  28 
    Total Non-Interest Income$220,799 $265,732  $(44,933) (17)%

    NM - Not meaningful. 
    BOLI - Bank-owned life insurance.

    TABLE 16: NON-INTEREST EXPENSE

     Three Months Ended Q2 2023 compared to
    Q1 2023
     Q2 2023 compared to
    Q2 2022
     Jun 30, Mar 31, Dec 31, Sep 30, Jun 30,  
    (Dollars in thousands)2023  2023  2022 2022 2022 $ Change % Change $ Change % Change
    Salaries and employee benefits:                 
    Salaries$107,671 $108,354  $100,232 $97,419 $92,414 $(683) (1)% $15,257  17%
    Commissions and incentive compensation 44,511  39,799   49,546  50,403  46,131  4,712  12   (1,620) (4)
    Benefits 32,741  28,628   30,553  28,273  28,781  4,113  14   3,960  14 
    Total salaries and employee benefits 184,923  176,781   180,331  176,095  167,326  8,142  5   17,597  11 
    Software and equipment 26,205  24,697   24,699  24,126  24,250  1,508  6   1,955  8 
    Operating lease equipment 9,816  9,833   10,078  9,448  8,774  (17) 0   1,042  12 
    Occupancy, net 19,176  18,486   17,763  17,727  17,651  690  4   1,525  9 
    Data processing 9,726  9,409   7,927  7,767  8,010  317  3   1,716  21 
    Advertising and marketing 17,794  11,946   14,279  16,600  16,615  5,848  49   1,179  7 
    Professional fees 8,940  8,163   9,267  7,544  7,876  777  10   1,064  14 
    Amortization of other acquisition-related intangible assets 1,499  1,235   1,436  1,492  1,579  264  21   (80) (5)
    FDIC insurance 9,008  8,669   6,775  7,186  6,949  339  4   2,059  30 
    OREO expense, net 118  (207)  369  229  294  325  NM   (176) (60)
    Other:                 
    Lending expenses, net of deferred origination costs 7,890  3,099   4,952  4,533  4,270  4,791  NM   3,620  85 
    Travel and entertainment 5,401  4,590   5,681  4,252  3,897  811  18   1,504  39 
    Miscellaneous 20,127  22,468   24,279  19,470  21,177  (2,341) (10)  (1,050) (5)
    Total other 33,418  30,157   34,912  28,255  29,344  3,261  11   4,074  14 
    Total Non-Interest Expense$320,623 $299,169  $307,836 $296,469 $288,668 $21,454  7% $31,955  11%

     

      Six Months Ended   
      Jun 30, Jun 30,$ %
    (Dollars in thousands)  2023   2022 Change Change
    Salaries and employee benefits:       
    Salaries $216,025  $184,530 $31,495  17%
    Commissions and incentive compensation  84,310   97,924  (13,614) (14)
    Benefits  61,369   57,227  4,142  7 
    Total salaries and employee benefits  361,704   339,681  22,023  6 
    Software and equipment  50,902   47,060  3,842  8 
    Operating lease equipment  19,649   18,482  1,167  6 
    Occupancy, net  37,662   35,475  2,187  6 
    Data processing  19,135   15,515  3,620  23 
    Advertising and marketing  29,740   28,539  1,201  4 
    Professional fees  17,103   16,277  826  5 
    Amortization of other acquisition-related intangible assets  2,734   3,188  (454) (14)
    FDIC insurance  17,677   14,678  2,999  20 
    OREO expense, net  (89)  (738) 649  (88)
    Other:       
    Lending expenses, net of deferred origination costs  10,989   11,091  (102) (1)
    Travel and entertainment  9,991   6,573  3,418  52 
    Miscellaneous  42,595   37,145  5,450  15 
    Total other  63,575   54,809  8,766  16 
    Total Non-Interest Expense $619,792  $572,966 $46,826  8%

    NM - Not meaningful.

    TABLE 17: SUPPLEMENTAL NON-GAAP FINANCIAL MEASURES/RATIOS

    The accounting and reporting policies of Wintrust conform to generally accepted accounting principles (“GAAP”) in the United States and prevailing practices in the banking industry. However, certain non-GAAP performance measures and ratios are used by management to evaluate and measure the Company’s performance. These include taxable-equivalent net interest income (including its individual components), taxable-equivalent net interest margin (including its individual components), the taxable-equivalent efficiency ratio, tangible common equity ratio, tangible book value per common share, return on average tangible common equity, and pre-tax income, excluding provision for credit losses. Management believes that these measures and ratios provide users of the Company’s financial information a more meaningful view of the performance of the Company’s interest-earning assets and interest-bearing liabilities and of the Company’s operating efficiency. Other financial holding companies may define or calculate these measures and ratios differently.

    Management reviews yields on certain asset categories and the net interest margin of the Company and its banking subsidiaries on a fully taxable-equivalent basis. In this non-GAAP presentation, net interest income is adjusted to reflect tax-exempt interest income on an equivalent before-tax basis using tax rates effective as of the end of the period. This measure ensures comparability of net interest income arising from both taxable and tax-exempt sources. Net interest income on a fully taxable-equivalent basis is also used in the calculation of the Company’s efficiency ratio. The efficiency ratio, which is calculated by dividing non-interest expense by total taxable-equivalent net revenue (less securities gains or losses), measures how much it costs to produce one dollar of revenue. Securities gains or losses are excluded from this calculation to better match revenue from daily operations to operational expenses. Management considers the tangible common equity ratio and tangible book value per common share as useful measurements of the Company’s equity. The Company references the return on average tangible common equity as a measurement of profitability. Management considers pre-tax income, excluding provision for credit losses, as a useful measurement of the Company’s core net income.

     Three Months EndedSix Months Ended
     Jun 30, Mar 31, Dec 31, Sep 30, Jun 30,Jun 30, Jun 30,
    (Dollars and shares in thousands) 2023   2023   2022   2022   2022  2023   2022 
    Reconciliation of Non-GAAP Net Interest Margin and Efficiency Ratio:   
    (A) Interest Income (GAAP)$697,176  $639,690  $580,745  $466,478  $371,968 $1,336,866  $700,220 
    Taxable-equivalent adjustment:            
    - Loans 1,882   1,872   1,594   1,030   568  3,754   995 
    - Liquidity Management Assets 551   551   538   502   472  1,102   937 
    - Other Earning Assets 1   4   1   1   1  5   3 
    (B) Interest Income (non-GAAP)$699,610  $642,117  $582,878  $468,011  $373,009 $1,341,727  $702,155 
    (C) Interest Expense (GAAP) 249,639   181,695   123,929   65,030   34,164  431,334   63,122 
    (D) Net Interest Income (GAAP) (A minus C)$447,537  $457,995  $456,816  $401,448  $337,804 $905,532  $637,098 
    (E) Net Interest Income (non-GAAP) (B minus C)$449,971  $460,422  $458,949  $402,981  $338,845 $910,393  $639,033 
    Net interest margin (GAAP) 3.64%  3.81%  3.71%  3.34%  2.92% 3.72%  2.76%
    Net interest margin, fully taxable-equivalent (non-GAAP) 3.66   3.83   3.73   3.35   2.93  3.74   2.77 
    (F) Non-interest income$113,030  $107,769  $93,839  $101,482  $102,942 $220,799  $265,732 
    (G) Gains (losses) on investment securities, net 0   1,398   (6,745)  (3,103)  (7,797) 1,398   (10,579)
    (H) Non-interest expense 320,623   299,169   307,836   296,469   288,668  619,792   572,966 
    Efficiency ratio (H/(D+F-G)) 57.20%  53.01%  55.23%  58.59%  64.36% 55.10%  62.73%
    Efficiency ratio (non-GAAP) (H/(E+F-G)) 56.95   52.78   55.02   58.41   64.21  54.86   62.60 
     Three Months EndedSix Months Ended
     Jun 30, Mar 31, Dec 31, Sep 30, Jun 30,Jun 30, Jun 30,
    (Dollars and shares in thousands) 2023   2023   2022   2022   2022  2023   2022 
    Reconciliation of Non-GAAP Tangible Common Equity Ratio:   
    Total shareholders’ equity (GAAP)$5,041,912  $5,015,506  $4,796,838  $4,637,980  $4,727,623    
    Less: Non-convertible preferred stock (GAAP) (412,500)  (412,500)  (412,500)  (412,500)  (412,500)   
    Less: Intangible assets (GAAP) (682,327)  (674,538)  (675,710)  (676,699)  (679,827)   
    (I) Total tangible common shareholders’ equity (non-GAAP)$3,947,085  $3,928,468  $3,708,628  $3,548,781  $3,635,296    
    (J) Total assets (GAAP)$54,286,176  $52,873,511  $52,949,649  $52,382,939  $50,969,332    
    Less: Intangible assets (GAAP) (682,327)  (674,538)  (675,710)  (676,699)  (679,827)   
    (K) Total tangible assets (non-GAAP)$53,603,849  $52,198,973  $52,273,939  $51,706,240  $50,289,505    
    Common equity to assets ratio (GAAP) (L/J) 8.5%  8.7%  8.3%  8.1%  8.5%   
    Tangible common equity ratio (non-GAAP) (I/K) 7.4   7.5   7.1   6.9   7.2    

     

    Reconciliation of Non-GAAP Tangible Book Value per Common Share:   
    Total shareholders’ equity$5,041,912  $5,015,506  $4,796,838  $4,637,980  $4,727,623    
    Less: Preferred stock (412,500)  (412,500)  (412,500)  (412,500)  (412,500)   
    (L) Total common equity$4,629,412  $4,603,006  $4,384,338  $4,225,480  $4,315,123    
    (M) Actual common shares outstanding 61,198   61,176   60,794   60,743   60,722    
    Book value per common share (L/M)$75.65  $75.24  $72.12  $69.56  $71.06    
    Tangible book value per common share (non-GAAP) (I/M) 64.50   64.22   61.00   58.42   59.87    
                 
    Reconciliation of Non-GAAP Return on Average Tangible Common Equity:   
    (N) Net income applicable to common shares$147,759  $173,207  $137,826  $135,970  $87,522 $320,966  $207,922 
    Add: Intangible asset amortization 1,499   1,235   1,436   1,492   1,579  2,734   3,188 
    Less: Tax effect of intangible asset amortization (402)  (321)  (370)  (425)  (445) (722)  (870)
    After-tax intangible asset amortization$1,097  $914  $1,066  $1,067  $1,134 $2,012  $2,318 
    (O) Tangible net income applicable to common shares (non-GAAP)$148,856  $174,121  $138,892  $137,037  $88,656 $322,978  $210,240 
    Total average shareholders’ equity$5,044,718  $4,895,271  $4,710,856  $4,795,387  $4,526,110 $4,970,407  $4,513,356 
    Less: Average preferred stock (412,500)  (412,500)  (412,500)  (412,500)  (412,500) (412,500)  (412,500)
    (P) Total average common shareholders’ equity$4,632,218  $4,482,771  $4,298,356  $4,382,887  $4,113,610 $4,557,907  $4,100,856 
    Less: Average intangible assets (682,561)  (675,247)  (676,371)  (678,953)  (681,091) (678,924)  (681,843)
    (Q) Total average tangible common shareholders’ equity (non-GAAP)$3,949,657  $3,807,524  $3,621,985  $3,703,934  $3,432,519 $3,878,983  $3,419,013 
    Return on average common equity, annualized (N/P) 12.79%  15.67%  12.72%  12.31%  8.53% 14.20%  10.22%
    Return on average tangible common equity, annualized (non-GAAP) (O/Q) 15.12   18.55   15.21   14.68   10.36  16.79   12.40 
                 
    Reconciliation of Non-GAAP Pre-Tax, Pre-Provision Income:     
    Income before taxes$211,430  $243,550  $195,173  $200,041  $131,661 $454,980  $305,341 
    Add: Provision for credit losses 28,514   23,045   47,646   6,420   20,417  51,559   24,523 
    Pre-tax income, excluding provision for credit losses (non-GAAP)$239,944  $266,595  $242,819  $206,461  $152,078 $506,539  $329,864 


    WINTRUST
    SUBSIDIARIES AND LOCATIONS

    Wintrust is a financial holding company whose common stock is traded on the Nasdaq Global Select Market (Nasdaq: WTFC). Its 15 community bank subsidiaries are: Lake Forest Bank & Trust Company, N.A., Hinsdale Bank & Trust Company, N.A., Wintrust Bank, N.A., in Chicago, Libertyville Bank & Trust Company, N.A., Barrington Bank & Trust Company, N.A., Crystal Lake Bank & Trust Company, N.A., Northbrook Bank & Trust Company, N.A., Schaumburg Bank & Trust Company, N.A., Village Bank & Trust, N.A., in Arlington Heights, Beverly Bank & Trust Company, N.A. in Chicago, Wheaton Bank & Trust Company, N.A., State Bank of The Lakes, N.A., in Antioch, Old Plank Trail Community Bank, N.A., in New Lenox, St. Charles Bank & Trust Company, N.A. and Town Bank, N.A., in Hartland, Wisconsin.

    In addition to the locations noted above, the banks also operate facilities in Illinois in Addison, Algonquin, Aurora, Bloomingdale, Bolingbrook, Buffalo Grove, Burbank, Cary, Clarendon Hills, Countryside, Crete, Darien, Deerfield, Des Plaines, Downers Grove, Elgin, Elk Grove Village, Elmhurst, Evanston, Evergreen Park, Frankfort, Geneva, Glen Ellyn, Glencoe, Glenview, Grayslake, Gurnee, Hanover Park, Highland Park, Highwood, Hoffman Estates, Homer Glen, Itasca, Joliet, Lake Bluff, Lake Villa, Lansing, Lemont, Lindenhurst, Lombard, Lynwood, Markham, Maywood, McHenry, Mokena, Mount Prospect, Mundelein, Naperville, Norridge, Northfield, Oak Lawn, Oak Park, Orland Park, Palatine, Park Ridge, Prospect Heights, Riverside, Rockford, Rolling Meadows, Round Lake Beach, Shorewood, Skokie, South Holland, Spring Grove, Steger, Stone Park, Vernon Hills, Wauconda, Waukegan, Western Springs, Willowbrook, Wilmette, Winnetka and Wood Dale, and in Wisconsin in Burlington, Clinton, Delafield, Delavan, Elm Grove, Genoa City, Kenosha, Lake Geneva, Madison, Menomonee Falls, Milwaukee, Pewaukee, Racine, Wales, Walworth, Whitefish Bay and Wind Lake, and in Florida in Bonita Springs and Naples, and in Dyer, Indiana.

    Additionally, the Company operates various non-bank business units:

    • FIRST Insurance Funding and Wintrust Life Finance, each a division of Lake Forest Bank & Trust Company, N.A., serve commercial and life insurance loan customers, respectively, throughout the United States.
    • First Insurance Funding of Canada serves commercial insurance loan customers throughout Canada.
    • Tricom, Inc. of Milwaukee provides high-yielding, short-term accounts receivable financing and value-added out-sourced administrative services, such as data processing of payrolls, billing and cash management services, to temporary staffing service clients located throughout the United States.
    • Wintrust Mortgage, a division of Barrington Bank & Trust Company, N.A., engages primarily in the origination and purchase of residential mortgages for sale into the secondary market through origination offices located throughout the United States. Loans are also originated nationwide through relationships with wholesale and correspondent offices.
    • Wintrust Investments, LLC is a broker-dealer providing a full range of private client and brokerage services to clients and correspondent banks located primarily in the Midwest.
    • Great Lakes Advisors LLC provides money management services and advisory services to individual accounts.
    • The Chicago Trust Company, N.A., a trust subsidiary, allows Wintrust to service customers’ trust and investment needs at each banking location.
    • Wintrust Asset Finance offers direct leasing opportunities.
    • CDEC provides Qualified Intermediary services (as defined by U.S. Treasury regulations) for taxpayers seeking to structure tax-deferred like-kind exchanges under Internal Revenue Code Section 1031.

    FORWARD-LOOKING STATEMENTS

    This document contains forward-looking statements within the meaning of federal securities laws. Forward-looking information can be identified through the use of words such as “intend,” “plan,” “project,” “expect,” “anticipate,” “believe,” “estimate,” “contemplate,” “possible,” “will,” “may,” “should,” “would” and “could.” Forward-looking statements and information are not historical facts, are premised on many factors and assumptions, and represent only management’s expectations, estimates and projections regarding future events. Similarly, these statements are not guarantees of future performance and involve certain risks and uncertainties that are difficult to predict, and which may include, but are not limited to, those listed below and the Risk Factors discussed under Item 1A of the Company’s 2022 Annual Report on Form 10-K and in any of the Company’s subsequent SEC filings. The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and is including this statement for purposes of invoking these safe harbor provisions. Such forward-looking statements may be deemed to include, among other things, statements relating to the Company’s future financial performance, the performance of its loan portfolio, the expected amount of future credit reserves and charge-offs, delinquency trends, growth plans, regulatory developments, securities that the Company may offer from time to time, the Company’s business and growth strategies, including future acquisitions of banks, specialty finance or wealth management businesses, internal growth and plans to form additional de novo banks or branch offices, and management’s long-term performance goals, as well as statements relating to the anticipated effects on the Company’s financial condition and results of operations from expected developments or events. Actual results could differ materially from those addressed in the forward-looking statements as a result of numerous factors, including the following:

    • economic conditions and events that affect the economy, housing prices, the job market and other factors that may adversely affect the Company’s liquidity and the performance of its loan portfolios, including an actual or threatened U.S. government debt default or rating downgrade, particularly in the markets in which it operates;
    • negative effects suffered by us or our customers resulting from changes in U.S. trade policies;
    • the extent of defaults and losses on the Company’s loan portfolio, which may require further increases in its allowance for credit losses;
    • estimates of fair value of certain of the Company’s assets and liabilities, which could change in value significantly from period to period;
    • the financial success and economic viability of the borrowers of our commercial loans;
    • commercial real estate market conditions in the Chicago metropolitan area and southern Wisconsin;
    • the extent of commercial and consumer delinquencies and declines in real estate values, which may require further increases in the Company’s allowance for credit losses;
    • inaccurate assumptions in our analytical and forecasting models used to manage our loan portfolio;
    • changes in the level and volatility of interest rates, the capital markets and other market indices that may affect, among other things, the Company’s liquidity and the value of its assets and liabilities;
    • the interest rate environment, including a prolonged period of low interest rates or rising interest rates, either broadly or for some types of instruments, which may affect the Company’s net interest income and net interest margin, and which could materially adversely affect the Company’s profitability;
    • competitive pressures in the financial services business which may affect the pricing of the Company’s loan and deposit products as well as its services (including wealth management services), which may result in loss of market share and reduced income from deposits, loans, advisory fees and income from other products;
    • failure to identify and complete favorable acquisitions in the future or unexpected difficulties or developments related to the integration of the Company’s recent or future acquisitions;
    • unexpected difficulties and losses related to FDIC-assisted acquisitions;
    • harm to the Company’s reputation;
    • any negative perception of the Company’s financial strength;
    • ability of the Company to raise additional capital on acceptable terms when needed;
    • disruption in capital markets, which may lower fair values for the Company’s investment portfolio;
    • ability of the Company to use technology to provide products and services that will satisfy customer demands and create efficiencies in operations and to manage risks associated therewith;
    • failure or breaches of our security systems or infrastructure, or those of third parties;
    • security breaches, including denial of service attacks, hacking, social engineering attacks, malware intrusion and similar events or data corruption attempts and identity theft;
    • adverse effects on our information technology systems resulting from failures, human error or cyberattacks (including ransomware);
    • adverse effects of failures by our vendors to provide agreed upon services in the manner and at the cost agreed, particularly our information technology vendors;
    • increased costs as a result of protecting our customers from the impact of stolen debit card information;
    • accuracy and completeness of information the Company receives about customers and counterparties to make credit decisions;
    • ability of the Company to attract and retain senior management experienced in the banking and financial services industries, and ability of the Company to effectively manage the planned transition of the chief executive officer role;
    • environmental liability risk associated with lending activities;
    • the impact of any claims or legal actions to which the Company is subject, including any effect on our reputation;
    • losses incurred in connection with repurchases and indemnification payments related to mortgages and increases in reserves associated therewith;
    • the loss of customers as a result of technological changes allowing consumers to complete their financial transactions without the use of a bank;
    • the soundness of other financial institutions and the impact of recent failures of financial institutions, including broader financial institution liquidity risk and concerns;
    • the expenses and delayed returns inherent in opening new branches and de novo banks;
    • liabilities, potential customer loss or reputational harm related to closings of existing branches;
    • examinations and challenges by tax authorities, and any unanticipated impact of the Tax Act;
    • changes in accounting standards, rules and interpretations, and the impact on the Company’s financial statements;
    • the ability of the Company to receive dividends from its subsidiaries;
    • the ability of the Company to successfully discontinue use of LIBOR and transition to an alternative benchmark rate for current and future transactions;
    • a decrease in the Company’s capital ratios, including as a result of declines in the value of its loan portfolios, or otherwise;
    • legislative or regulatory changes, particularly changes in regulation of financial services companies and/or the products and services offered by financial services companies;
    • changes in laws, regulations, rules, standards and contractual obligations regarding data privacy and cybersecurity;
    • a lowering of our credit rating;
    • changes in U.S. monetary policy and changes to the Federal Reserve’s balance sheet, including changes in response to persistent inflation or otherwise;
    • regulatory restrictions upon our ability to market our products to consumers and limitations on our ability to profitably operate our mortgage business;
    • increased costs of compliance, heightened regulatory capital requirements and other risks associated with changes in regulation and the regulatory environment;
    • the impact of heightened capital requirements;
    • increases in the Company’s FDIC insurance premiums, or the collection of special assessments by the FDIC;
    • delinquencies or fraud with respect to the Company’s premium finance business;
    • credit downgrades among commercial and life insurance providers that could negatively affect the value of collateral securing the Company’s premium finance loans;
    • the Company’s ability to comply with covenants under its credit facility;
    • fluctuations in the stock market, which may have an adverse impact on the Company’s wealth management business and brokerage operation;
    • widespread outages of operational, communication, or other systems, whether internal or provided by third parties, natural or other disasters (including acts of terrorism, armed hostilities and pandemics), and the effects of climate change could have an adverse effect on the Company’s financial condition and results of operations, lead to material disruption of the Company’s operations or the ability or willingness of clients to access the Company’s products and services; and
    • the severity, magnitude and duration of the COVID-19 pandemic, including the continued emergence of variant strains, and the direct and indirect impact of such pandemic, as well as responses to the pandemic by the government, businesses and consumers, on the economy, our financial results, operations and personnel, commercial activity and demand across our business and our customers’ businesses.

    Therefore, there can be no assurances that future actual results will correspond to these forward-looking statements. The reader is cautioned not to place undue reliance on any forward-looking statement made by the Company. Any such statement speaks only as of the date the statement was made or as of such date that may be referenced within the statement. The Company undertakes no obligation to update any forward-looking statement to reflect the impact of circumstances or events after the date of the press release. Persons are advised, however, to consult further disclosures management makes on related subjects in its reports filed with the Securities and Exchange Commission and in its press releases.

    CONFERENCE CALL, WEBCAST AND REPLAY

    The Company will hold a conference call on Thursday, July 20, 2023 at 9:00 a.m. (CDT) regarding second quarter and year-to-date 2023 earnings results. Individuals interested in participating in the call by addressing questions to management should register for the call to receive the dial-in numbers and unique PIN at the link included within the Company’s press release dated July 6, 2023 available at the Investor Relations, Investor News and Events, Press Releases link on its website at https://www.wintrust.com. A separate simultaneous audio-only webcast link is included within the press release referenced above. Registration for and a replay of the audio-only webcast with an accompanying slide presentation will be available at https://www.wintrust.com, Investor Relations, Investor News and Events, Presentations & Conference Calls. The text of the second quarter and year-to-date 2023 earnings press release will also be available on the home page of the Company’s website at https://www.wintrust.com and at the Investor Relations, Investor News and Events, Press Releases link on its website.

    FOR MORE INFORMATION CONTACT:
    Timothy S. Crane, President & Chief Executive Officer
    David A. Dykstra, Vice Chairman & Chief Operating Officer
    (847) 939-9000
    Web site address: www.wintrust.com


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