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

Wintrust Financial Corporation

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 Ended																			Six 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 Ended																		Six 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		$	294,688	NM			(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		$	513,232	26	%		(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			1,592,329	9			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			1,145,602	56			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			1,321,745	10			6
Industrial		2,002,740			1,858,088			1,836,276			1,777,658			1,746,280	18			15
Retail		1,304,083			1,309,680			1,304,444			1,331,316			1,331,059	0			(2	)
Multi-family		2,696,478			2,635,411			2,560,709			2,305,433			2,171,583	11			24
Mixed use and other		1,440,652			1,446,806			1,425,412			1,368,537			1,330,220	2			8
Home equity		336,974			337,016			332,698			328,822			325,826	3			3
Residential real estate
Residential real estate loans for investment		2,455,392			2,309,393			2,207,595			2,086,795			1,965,051	23			25
Residential mortgage loans, early buy-out eligible loans guaranteed by U.S. government agencies		117,024			119,301			80,701			57,161			34,764	91			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		$	21,076,559	8	%		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			398,085	NM			(4	)
Community Advantage - homeowners association		405,042			389,922			380,875			365,967			341,095	13			19
Insurance agency lending		925,520			905,727			897,678			879,183			906,375	6			2
Premium Finance receivables
U.S. property & casualty insurance		5,900,228			5,043,486			5,103,820			4,983,795			4,781,042	31			23
Canada property & casualty insurance		862,470			695,394			745,639			729,545			760,405	32			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		$	15,976,544	12	%		10	%
Total loans, net of unearned income	$	41,023,408		$	39,565,471		$	39,196,485		$	38,167,613		$	37,053,103	9	%		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, 2023	2.9	%		1.8	%		(0.9	)%		(3.4	)%
Mar 31, 2023	3.0			1.7			(1.3	)		(3.4	)
Dec 31, 2022	5.6			3.0			(2.9	)		(6.8	)
Sep 30, 2022	6.5			3.6			(3.9	)		(8.6	)
Jun 30, 2022	10.2			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, 2023	One 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		34	bps	76	bps	36	bps	25	bps
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 Ended																			Six 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 Ended																		Six 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, 2023								As of Mar 31, 2023								As 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 Ended																			Six 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 Ended																			Six 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 Ended																			Six 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