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First Financial Bancorp.
First Financial Bancorp Announces Third Quarter 2023 Financial Results and Quarterly Dividend
Business
Oct 24 2023
3 min read

First Financial Bancorp Announces Third Quarter 2023 Financial Results and Quarterly Dividend

  • Earnings per diluted share of $0.66; $0.67 on an adjusted(1) basis; 10% increase YoY
  • Return on average assets of 1.48%; 1.49% on an adjusted(1) basis
  • Net interest margin on FTE basis(1) of 4.33%; 15 bp decrease from linked quarter
  • Loan growth of $96.6 million; 3.6% on an annualized basis
  • Average deposit balances increased 3.8% on an annualized basis, excluding brokered deposits
  • Strong adjusted(1) fee income of $56.8 million driven by the leasing and wealth management
  • Quarterly dividend of $0.23 approved by Board of Directors

CINCINNATI, Oct. 24, 2023 /PRNewswire/ -- First Financial Bancorp. (Nasdaq: FFBC) ("First Financial" or the "Company") announced financial results for the three and nine months ended September 30, 2023. 

For the three months ended September 30, 2023, the Company reported net income of $63.1 million, or $0.66 per diluted common share.  These results compare to net income of $65.7 million, or $0.69 per diluted common share, for the second quarter of 2023.  For the nine months ended September 30, 2023, First Financial had earnings per diluted share of $2.09 compared to $1.57 for the same period in 2022.

Return on average assets for the third quarter of 2023 was 1.48% while return on average tangible common equity was 23.60%(1).  These compare to return on average assets of 1.55% and return on average tangible common equity of 25.27%(1) in the second quarter of 2023.

Third quarter 2023 highlights include:

  • Net interest margin of 4.28%, or 4.33% on a fully tax-equivalent basis(1)
    • 15 bp decrease to 4.33% from 4.48% in the second quarter due to increasing deposit costs
    • Higher asset yields significantly offset 37 bp increase in cost of deposits
    • Average deposit balances increased $73.3 million with growth in money market accounts and retail CDs offsetting declines in noninterest bearing checking and savings accounts
  • Noninterest income of $56.6 million, or $56.8 million as adjusted(1)
    • Foreign exchange income of $13.4 million reflected continued strong activity
    • Record wealth management fees of $6.9 million; 3.4% increase from linked quarter
    • Leasing business income of $14.5 million; 41.6% increase from linked quarter
    • Adjusted(1) $0.2 million for losses on investment securities and other items not expected to recur
  • Noninterest expenses of $122.0 million, or $121.5 million as adjusted(1)
    • $1.4 million increase from linked quarter driven primarily by higher employee costs, leasing expenses and fraud losses
    • Second quarter adjustments(1) include costs related to our online banking conversion and other costs not expected to recur such as acquisition, severance and branch consolidation costs
    • Efficiency ratio of 57.5%; 57.3% as adjusted(1)

______________________________________________________________________________

(1) Non-GAAP measure.  For details on the calculation of these non-GAAP financial measures and a reconciliation to the GAAP financial measure, see the sections titled "Use of Non-GAAP Financial Measures" in this release and "Appendix: Non-GAAP to GAAP Reconciliation" in the accompanying slide presentation.

(2) The consolidated balance sheets at December 31, 2022 and September 30, 2022 include assets acquired and liabilities assumed in the acquisition of Summit Financial Group.  The fair value measurements of assets acquired and liabilities assumed are subject to refinement for up to one year after the closing date of the acquisition as additional information relative to closing date fair values becomes available.  These fair value measurements were considered final as of December 31, 2022.

  • Moderate loan growth during the quarter
    • Loan balances increased $96.6 million compared to the first quarter
    • Growth of 3.6% on an annualized basis
    • Residential mortgages and finance leases drove quarterly growth
  • Total Allowance for Credit Losses of $162.2 million; Total quarterly provision expense of $11.7 million
    • Loans and leases - ACL of $145.2 million; decreased 5 bps to 1.36% of total loans
    • Unfunded Commitments - ACL of $17.0 million
    • Provision expense driven by net charge-offs; Classified assets increased slightly to $140.6 million
    • Net charge-offs 61 bps of total loans and included $6.1 million from loan sale and $6.9 million from a COVID impacted business
  • Capital ratios remain solid
    • Total capital ratio increased 7 bps to 13.51%
    • Tier 1 common equity increased 26 bps to 11.60%
    • Tangible common equity decreased 6 bps to 6.50%(1); 9.07%(1) excluding impact from AOCI
    • Tangible book value per share of $10.91(1)

Additionally, the board of directors approved a quarterly dividend of $0.23 per common share for the next regularly scheduled dividend, payable on December 15, 2023 to shareholders of record as of December 1, 2023.

Archie Brown, President and CEO, commented on the quarter, "Overall, I am pleased with our third quarter performance.  Strong net interest income and robust fee income led to a 13% increase in net income from the third quarter of 2022.  Adjusted return on assets was 1.49% and adjusted return on average tangible common equity was 23.8%.  As expected, higher deposit costs led to a slight reduction in earnings on a linked quarter basis.  Even so, our net interest margin was 4.33% for the quarter, which was at the high end of our expectations."

Mr. Brown continued, "Loan growth was in line with expectations for the period, led by growth in the Leasing and Mortgage  portfolios.  We expect moderate loan growth over the remainder of the year.  Deposit balances were stable during the quarter.  While the change in mix from non-interest bearing to CDs and Money Market accounts continued, we experienced slight growth in total balances and our loan to deposit ratio remained flat at 82%.  Our fee income continued to exceed expectations this quarter, with strong performance from wealth management, equipment leasing, Bannockburn, and mortgage banking." 

Mr. Brown commented on asset quality, "Credit trends were mixed during the period, and we experienced elevated net charge-offs.  During the third quarter we elected to sell approximately $32 million in commercial real estate loans and incurred a $6.1 million loss on the sale.  We also recorded a $6.9 million loss on a large C&I loan that was negatively impacted during Covid and has been unable to rebound in the period since.  Additionally, nonaccrual loan balances increased during the period due to the downgrade of one office loan whose major tenant vacated the space during the quarter.  Classified Assets remain low and we expect provision expense to to be fairly stable in the fourth quarter."

Mr. Brown concluded, "We remain pleased with our high net interest margin, favorable fee income trends and robust earnings.  During the quarter, our regulatory capital levels strengthened, and our strong earnings helped to maintain the tangible common equity ratio despite the negative impact to AOCI from the increase in market rates.  We are encouraged by our performance in 2023 and we believe we are well positioned to navigate the current economic environment and continue to deliver strong results."

Full detail of the Company's third quarter 2023 performance is provided in the accompanying financial statements and slide presentation.

Teleconference / Webcast InformationFirst Financial's executive management will host a conference call to discuss the Company's financial and operating results on Wednesday, October 25, 2023 at 8:30 a.m. Eastern Time.  Members of the public who would like to listen to the conference call should dial (888) 550-5723 (U.S. toll free) or (646) 960-0471 (U.S. local), access code 5048068.  The number should be dialed five to ten minutes prior to the start of the conference call.  A replay of the conference call will be available beginning one hour after the completion of the live call at (800) 770-2030 (U.S. toll free), (647) 362-9199 (U.S. local), access code 5048068.  The recording will be available until November 8, 2023.  The conference call will also be accessible as an audio webcast via the Investor Relations section of the Company's website at  www.bankatfirst.com.  The webcast will be archived on the Investor Relations section of the Company's website for 12 months.

Press Release and Additional Information on WebsiteThis press release as well as supplemental information are available to the public through the Investor Relations section of First Financial's website at www.bankatfirst.com.

Use of Non-GAAP Financial MeasuresThis earnings release contains GAAP financial measures and Non-GAAP financial measures where management believes it to be helpful in understanding the Company's results of operations or financial position.  Where Non-GAAP financial measures are used, the comparable GAAP financial measures, as well as a reconciliation to the comparable GAAP financial measure, can be found in the section titled "Appendix: Non-GAAP to GAAP Reconciliation" in the accompanying slide presentation.

Forward-Looking StatementsCertain statements contained in this report which are not statements of historical fact constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  Words such as ''believes,'' ''anticipates,'' "likely," "expected," "estimated," ''intends'' and other similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements.  Examples of forward-looking statements include, but are not limited to, statements we make about (i) our future operating or financial performance, including revenues, income or loss and earnings or loss per share, (ii) future common stock dividends, (iii) our capital structure, including future capital levels, (iv) our plans, objectives and strategies, and (v) the assumptions that underlie our forward-looking statements.

As with any forecast or projection, forward-looking statements are subject to inherent uncertainties, risks and changes in circumstances that may cause actual results to differ materially from those set forth in the forward-looking statements.  Forward-looking statements are not historical facts but instead express only management's beliefs regarding future results or events, many of which, by their nature, are inherently uncertain and outside of management's control. It is possible that actual results and outcomes may differ, possibly materially, from the anticipated results or outcomes indicated in these forward-looking statements.  Important factors that could cause actual results to differ materially from those in our forward-looking statements include the following, without limitation:

  • economic, market, liquidity, credit, interest rate, operational and technological risks associated with the Company's business;
  • future credit quality and performance, including our expectations regarding future loan losses and our allowance for credit losses
  • the effect of and changes in policies and laws or regulatory agencies, including the Dodd-Frank Wall Street Reform and Consumer Protection Act and other legislation and regulation relating to the banking industry;
  • Management's ability to effectively execute its business plans;
  • mergers and acquisitions, including costs or difficulties related to the integration of acquired companies;
  • the possibility that any of the anticipated benefits of the Company's acquisitions will not be realized or will not be realized within the expected time period;
  • the effect of changes in accounting policies and practices;
  • changes in consumer spending, borrowing and saving and changes in unemployment;
  • changes in customers' performance and creditworthiness;
  • the costs and effects of litigation and of unexpected or adverse outcomes in such litigation;  
  • current and future economic and market conditions, including the effects of changes in housing prices, fluctuations in unemployment rates, U.S. fiscal debt, budget and tax matters, geopolitical matters, and any slowdown in global economic growth;
  • the adverse impact on the U.S. economy, including the markets in which we operate, of the novel coronavirus, which causes the Coronavirus disease 2019 ("COVID-19"), global pandemic, and the impact  on the performance of our loan and lease portfolio, the market value of our investment securities, the availability of sources of funding and the demand for our products;
  • our capital and liquidity requirements (including under regulatory capital standards, such as the Basel III capital standards) and our ability to generate capital internally or raise capital on favorable terms;
  • financial services reform and other current, pending or future legislation or regulation that could have a negative effect on our revenue and businesses, including the Dodd-Frank Act and other legislation and regulation relating to bank products and services;
  • the effect of the current interest rate environment or changes in interest rates or in the level or composition of our assets or liabilities on our net interest income, net interest margin and our mortgage originations, mortgage servicing rights and mortgage loans held for sale;
  • the effect of a fall in stock market prices on our brokerage, asset and wealth management businesses;
  • a failure in or breach of our operational or security systems or infrastructure, or those of our third-party vendors or other service providers, including as a result of cyber attacks;
  • the effect of changes in the level of checking or savings account deposits on our funding costs and net interest margin; and
  • our ability to develop and execute effective business plans and strategies.

Additional factors that may cause our actual results to differ materially from those described in our forward-looking statements can be found in our Form 10-K for the year ended December 31, 2022, as well as our other filings with the SEC, which are available on the SEC website at www.sec.gov. 

All forward-looking statements included in this filing are made as of the date hereof and are based on information available at the time of the filing.  Except as required by law, the Company does not assume any obligation to update any forward-looking statement.

About First Financial Bancorp.First Financial Bancorp. is a Cincinnati, Ohio based bank holding company.  As of September 30, 2023, the Company had $17.1 billion in assets, $10.6 billion in loans, $12.9 billion in deposits and $2.1 billion in shareholders' equity.  The Company's subsidiary, First Financial Bank, founded in 1863, provides banking and financial services products through its six lines of business: Commercial, Retail Banking, Investment Commercial Real Estate, Mortgage Banking, Commercial Finance and Wealth Management.  These business units provide traditional banking services to business and retail clients.  Wealth Management provides wealth planning, portfolio management, trust and estate, brokerage and retirement plan services and had approximately $3.3 billion in assets under management as of September 30, 2023.  The Company operated 130 full service banking centers as of September 30, 2023, located in Ohio, Indiana, Kentucky and Illinois, while the Commercial Finance business lends into targeted industry verticals on a nationwide basis.  Additional information about the Company, including its products, services and banking locations, is available at www.bankatfirst.com.

FIRST FINANCIAL BANCORP.

CONSOLIDATED FINANCIAL HIGHLIGHTS

(Dollars in thousands, except per share data)

(Unaudited)

Three Months Ended,

Nine months ended,

Sep. 30,

June 30,

Mar. 31,

Dec. 31,

Sep. 30,

Sep. 30,

2023

2023

2023

2022

2022

2023

2022

RESULTS OF OPERATIONS

Net income

$     63,061

$     65,667

$     70,403

$     69,086

$     55,705

$     99,131

$   148,526

Net earnings per share - basic

$         0.67

$         0.70

$         0.75

$         0.74

$         0.60

$         2.12

$         1.59

Net earnings per share - diluted

$         0.66

$         0.69

$         0.74

$         0.73

$         0.59

$         2.09

$         1.57

Dividends declared per share

$         0.23

$         0.23

$         0.23

$         0.23

$         0.23

$         0.69

$         0.69

KEY FINANCIAL RATIOS

Return on average assets

1.48 %

1.55 %

1.69 %

1.63 %

1.35 %

1.57 %

1.22 %

Return on average shareholders' equity

11.62 %

12.32 %

13.71 %

13.64 %

10.58 %

12.53 %

9.29 %

Return on average tangible shareholders' equity (1)

23.60 %

25.27 %

29.02 %

29.93 %

22.29 %

25.87 %

19.14 %

Net interest margin

4.28 %

4.43 %

4.51 %

4.43 %

3.93 %

4.41 %

3.49 %

Net interest margin (fully tax equivalent) (1)(2)

4.33 %

4.48 %

4.55 %

4.47 %

3.98 %

4.45 %

3.53 %

Ending shareholders' equity as a percent of ending assets

12.49 %

12.54 %

12.53 %

12.01 %

12.00 %

12.49 %

12.00 %

Ending tangible shareholders' equity as a percent of:

Ending tangible assets (1)

6.50 %

6.56 %

6.47 %

5.95 %

5.79 %

6.50 %

5.79 %

Risk-weighted assets (1)

7.88 %

8.03 %

7.87 %

7.32 %

7.21 %

7.88 %

7.21 %

Average shareholders' equity as a percent of average assets

12.70 %

12.60 %

12.29 %

11.98 %

12.75 %

12.53 %

13.15 %

Average tangible shareholders' equity as a percent of

    average tangible assets (1)

6.69 %

6.57 %

6.21 %

5.84 %

6.49 %

6.49 %

6.85 %

Book value per share

$        22.39

$        22.52

$        22.29

$        21.51

$        21.03

$        22.39

$        21.03

Tangible book value per share (1)

$        10.91

$        11.02

$        10.76

$          9.97

$          9.48

$        10.91

$          9.48

Common equity tier 1 ratio (3)

11.60 %

11.34 %

11.00 %

10.83 %

10.82 %

11.60 %

10.82 %

Tier 1 ratio (3)

11.94 %

11.68 %

11.34 %

11.17 %

11.17 %

11.94 %

11.17 %

Total capital ratio (3)

13.51 %

13.44 %

13.11 %

13.09 %

13.15 %

13.51 %

13.15 %

Leverage ratio (3)

9.59 %

9.33 %

9.03 %

8.89 %

8.88 %

9.59 %

8.88 %

AVERAGE BALANCE SHEET ITEMS

Loans (4)

$  10,623,734

$  10,513,505

$  10,373,302

$  10,059,119

$  9,597,197

$  10,504,431

$  9,411,807

Investment securities

3,394,237

3,560,453

3,635,317

3,705,304

4,003,472

3,529,119

4,142,157

Interest-bearing deposits with other banks

386,173

329,584

318,026

372,054

317,146

344,844

295,174

  Total earning assets

$  14,404,144

$  14,403,542

$  14,326,645

$  14,136,477

$  13,917,815

$  14,378,394

$  13,849,138

Total assets

$  16,951,389

$  16,968,055

$  16,942,999

$  16,767,598

$  16,385,989

$  16,954,178

$  16,253,031

Noninterest-bearing deposits

$    3,493,305

$    3,663,419

$    3,954,915

$    4,225,192

$    4,176,242

$    3,702,189

$    4,187,145

Interest-bearing deposits

9,293,860

9,050,464

8,857,226

8,407,114

8,194,781

9,068,783

8,375,581

  Total deposits

$  12,787,165

$  12,713,883

$  12,812,141

$  12,632,306

$  12,371,023

$  12,770,972

$  12,562,726

Borrowings

$    1,403,071

$    1,523,699

$    1,434,338

$    1,489,088

$    1,406,718

$    1,453,588

$    1,071,845

Shareholders' equity

$    2,153,601

$    2,137,765

$    2,082,210

$    2,009,564

$    2,089,179

$    2,124,787

$    2,137,615

CREDIT QUALITY RATIOS

Allowance to ending loans

1.36 %

1.41 %

1.36 %

1.29 %

1.27 %

1.36 %

1.27 %

Allowance to nonaccrual loans

193.75 %

276.70 %

409.46 %

464.58 %

341.61 %

193.75 %

341.61 %

Allowance to nonperforming loans

193.75 %

276.70 %

409.46 %

335.94 %

262.09 %

193.75 %

262.09 %

Nonperforming loans to total loans

0.70 %

0.51 %

0.33 %

0.38 %

0.48 %

0.70 %

0.48 %

Nonaccrual loans to total loans

0.70 %

0.51 %

0.33 %

0.28 %

0.37 %

0.70 %

0.37 %

Nonperforming assets to ending loans, plus OREO

0.71 %

0.51 %

0.33 %

0.39 %

0.48 %

0.71 %

0.48 %

Nonperforming assets to total assets

0.44 %

0.32 %

0.21 %

0.23 %

0.28 %

0.44 %

0.28 %

Classified assets to total assets

0.82 %

0.81 %

0.94 %

0.75 %

0.69 %

0.82 %

0.69 %

Net charge-offs to average loans (annualized)

0.61 %

0.22 %

0.00 %

(0.01) %

0.07 %

0.28 %

0.08 %

(1) Non-GAAP measure.  For details on the calculation of these non-GAAP financial measures and a reconciliation to the GAAP financial measure, see the sections titled "Use of Non-GAAP Financial Measures" in this release and "Appendix: Non-GAAP to GAAP Reconciliation" in the accompanying slide presentation.

(2) The tax equivalent adjustment to net interest income recognizes the income tax savings when comparing taxable and tax-exempt assets and assumes a 21% tax rate.  Management believes that it is a standard practice in the banking industry to present net interest margin and net interest income on a fully tax equivalent basis.  Therefore, management believes these measures provide useful information to investors by allowing them to make peer comparisons.  Management also uses these measures to make peer comparisons.

(3) September 30, 2023 regulatory capital ratios are preliminary.

(4) Includes loans held for sale.

 

FIRST FINANCIAL BANCORP.

CONSOLIDATED STATEMENTS OF INCOME

(Dollars in thousands, except per share data)

(Unaudited)

Three months ended,

Nine months ended,

Sep. 30,

Sep. 30,

2023

2022

% Change

2023

2022

% Change

Interest income

  Loans and leases, including fees

$     192,261

$     122,170

57.4 %

$     546,354

$     306,443

78.3 %

  Investment securities

     Taxable

31,297

26,331

18.9 %

95,226

72,066

32.1 %

     Tax-exempt

3,522

5,014

(29.8) %

10,499

14,361

(26.9) %

        Total investment securities interest

34,819

31,345

11.1 %

105,725

86,427

22.3 %

  Other earning assets

5,011

1,597

213.8 %

12,488

2,222

462.0 %

       Total interest income

232,091

155,112

49.6 %

664,567

395,092

68.2 %

Interest expense

  Deposits

57,069

6,386

793.7 %

132,817

11,972

1,009.4 %

  Short-term borrowings

14,615

6,158

137.3 %

43,101

8,041

436.0 %

  Long-term borrowings

4,952

4,676

5.9 %

14,644

13,832

5.9 %

      Total interest expense

76,636

17,220

345.0 %

190,562

33,845

463.0 %

      Net interest income

155,455

137,892

12.7 %

474,005

361,247

31.2 %

  Provision for credit losses-loans and leases

12,907

7,898

63.4 %

34,270

(1,958)

N/M

  Provision for credit losses-unfunded commitments

(1,234)

386

(419.7) %

(1,393)

3,641

(138.3) %

      Net interest income after provision for credit losses

143,782

129,608

10.9 %

441,128

359,564

22.7 %

Noninterest income

  Service charges on deposit accounts

6,957

6,279

10.8 %

20,443

21,656

(5.6) %

  Wealth management fees

6,943

5,487

26.5 %

19,990

17,858

11.9 %

  Bankcard income

3,406

3,484

(2.2) %

10,690

10,644

0.4 %

  Client derivative fees

1,612

1,447

11.4 %

4,444

3,619

22.8 %

  Foreign exchange income

13,384

11,752

13.9 %

45,321

35,373

28.1 %

  Leasing business income

14,537

7,127

104.0 %

38,466

20,450

88.1 %

  Net gains from sales of loans

4,086

3,729

9.6 %

10,260

12,842

(20.1) %

  Net gain (loss) on sale of investment securities

(4)

(179)

(97.8) %

(407)

(176)

131.3 %

  Net gain (loss) on equity  securities

(54)

(701)

(92.3) %

4

(1,954)

(100.2) %

  Other

5,761

4,109

40.2 %

16,218

13,294

22.0 %

      Total noninterest income

56,628

42,534

33.1 %

165,429

133,606

23.8 %

Noninterest expenses

  Salaries and employee benefits

75,641

66,808

13.2 %

222,094

195,747

13.5 %

  Net occupancy

5,809

5,669

2.5 %

17,100

16,774

1.9 %

  Furniture and equipment

3,341

3,222

3.7 %

10,020

9,990

0.3 %

  Data processing

8,473

8,497

(0.3) %

27,364

25,095

9.0 %

  Marketing

2,598

2,523

3.0 %

7,560

6,546

15.5 %

  Communication

744

657

13.2 %

2,022

1,993

1.5 %

  Professional services

2,524

2,346

7.6 %

6,778

6,719

0.9 %

  State intangible tax

981

1,090

(10.0) %

2,930

3,311

(11.5) %

  FDIC assessments

2,665

1,885

41.4 %

8,297

5,021

65.2 %

  Intangible amortization

2,600

2,783

(6.6) %

7,801

8,612

(9.4) %

  Leasing business expense

8,877

5,746

54.5 %

23,545

14,302

64.6 %

  Other

7,791

23,842

(67.3) %

23,841

36,797

(35.2) %

      Total noninterest expenses

122,044

125,068

(2.4) %

359,352

330,907

8.6 %

Income before income taxes

78,366

47,074

66.5 %

247,205

162,263

52.3 %

Income tax expense (benefit)

15,305

(8,631)

(277.3) %

48,074

13,737

250.0 %

      Net income

$       63,061

$       55,705

13.2 %

$     199,131

$     148,526

34.1 %

ADDITIONAL DATA

Net earnings per share - basic

$          0.67

$          0.60

$          2.12

$          1.59

Net earnings per share - diluted

$          0.66

$          0.59

$          2.09

$          1.57

Dividends declared per share

$          0.23

$          0.23

$          0.69

$          0.69

Return on average assets

1.48 %

1.35 %

1.57 %

1.22 %

Return on average shareholders' equity

11.62 %

10.58 %

12.53 %

9.29 %

Interest income

$     232,091

$     155,112

49.6 %

$     664,567

$     395,092

68.2 %

Tax equivalent adjustment

1,659

1,712

(3.1) %

4,684

4,804

(2.5) %

   Interest income - tax equivalent

233,750

156,824

49.1 %

669,251

399,896

67.4 %

Interest expense

76,636

17,220

345.0 %

190,562

33,845

463.0 %

   Net interest income - tax equivalent

$     157,114

$     139,604

12.5 %

$     478,689

$     366,051

30.8 %

Net interest margin

4.28 %

3.93 %

4.41 %

3.49 %

Net interest margin (fully tax equivalent) (1)

4.33 %

3.98 %

4.45 %

3.53 %

Full-time equivalent employees

2,121

2,072

(1) The tax equivalent adjustment to net interest income recognizes the income tax savings when comparing taxable and tax-exempt assets and assumes a 21% tax rate.  Management believes that it is a standard practice in the banking industry to present net interest income on a fully tax equivalent basis.  Therefore, management believes these measures provide useful information to investors by allowing them to make peer comparisons.  Management also uses these measures to make peer comparisons.

 

FIRST FINANCIAL BANCORP.

CONSOLIDATED QUARTERLY STATEMENTS OF INCOME

(Dollars in thousands, except per share data)

(Unaudited)

2023

Third

Second

First

Year to

% Change

Quarter

Quarter

Quarter

Date

Linked Qtr.

Interest income

  Loans and leases, including fees

$ 192,261

$ 184,387

$ 169,706

$ 546,354

4.3 %

  Investment securities

     Taxable

31,297

32,062

31,867

95,226

(2.4) %

     Tax-exempt

3,522

3,513

3,464

10,499

0.3 %

        Total investment securities interest

34,819

35,575

35,331

105,725

(2.1) %

  Other earning assets

5,011

3,933

3,544

12,488

27.4 %

       Total interest income

232,091

223,895

208,581

664,567

3.7 %

Interest expense

  Deposits

57,069

44,292

31,456

132,817

28.8 %

  Short-term borrowings

14,615

15,536

12,950

43,101

(5.9) %

  Long-term borrowings

4,952

4,835

4,857

14,644

2.4 %

      Total interest expense

76,636

64,663

49,263

190,562

18.5 %

      Net interest income

155,455

159,232

159,318

474,005

(2.4) %

  Provision for credit losses-loans and leases

12,907

12,719

8,644

34,270

1.5 %

  Provision for credit losses-unfunded commitments

(1,234)

(1,994)

1,835

(1,393)

(38.1) %

      Net interest income after provision for credit losses

143,782

148,507

148,839

441,128

(3.2) %

Noninterest income

  Service charges on deposit accounts

6,957

6,972

6,514

20,443

(0.2) %

  Wealth management fees

6,943

6,713

6,334

19,990

3.4 %

  Bankcard income

3,406

3,692

3,592

10,690

(7.7) %

  Client derivative fees

1,612

1,827

1,005

4,444

(11.8) %

  Foreign exchange income

13,384

15,039

16,898

45,321

(11.0) %

  Leasing business income

14,537

10,265

13,664

38,466

41.6 %

  Net gains from sales of loans

4,086

3,839

2,335

10,260

6.4 %

  Net gain (loss) on sale of investment securities

(4)

(384)

(19)

(407)

(99.0) %

  Net gain (loss) on equity securities

(54)

(82)

140

4

34.1 %

  Other

5,761

5,377

5,080

16,218

7.1 %

      Total noninterest income

56,628

53,258

55,543

165,429

6.3 %

Noninterest expenses

  Salaries and employee benefits

75,641

74,199

72,254

222,094

1.9 %

  Net occupancy

5,809

5,606

5,685

17,100

3.6 %

  Furniture and equipment

3,341

3,362

3,317

10,020

(0.6) %

  Data processing

8,473

9,871

9,020

27,364

(14.2) %

  Marketing

2,598

2,802

2,160

7,560

(7.3) %

  Communication

744

644

634

2,022

15.5 %

  Professional services

2,524

2,308

1,946

6,778

9.4 %

  State intangible tax

981

964

985

2,930

1.8 %

  FDIC assessments

2,665

2,806

2,826

8,297

(5.0) %

  Intangible amortization

2,600

2,601

2,600

7,801

0.0 %

  Leasing business expense

8,877

6,730

7,938

23,545

31.9 %

  Other

7,791

8,722

7,328

23,841

(10.7) %

      Total noninterest expenses

122,044

120,615

116,693

359,352

1.2 %

Income before income taxes

78,366

81,150

87,689

247,205

(3.4) %

Income tax expense (benefit)

15,305

15,483

17,286

48,074

(1.1) %

      Net income

$   63,061

$   65,667

$   70,403

$ 199,131

(4.0) %

ADDITIONAL DATA

Net earnings per share - basic

$      0.67

$      0.70

$      0.75

$      2.12

Net earnings per share - diluted

$      0.66

$      0.69

$      0.74

$      2.09

Dividends declared per share

$      0.23

$      0.23

$      0.23

$      0.69

Return on average assets

1.48 %

1.55 %

1.69 %

1.57 %

Return on average shareholders' equity

11.62 %

12.32 %

13.71 %

12.53 %

Interest income

$ 232,091

$ 223,895

$ 208,581

$ 664,567

3.7 %

Tax equivalent adjustment

1,659

1,601

1,424

4,684

3.6 %

   Interest income - tax equivalent

233,750

225,496

210,005

669,251

3.7 %

Interest expense

76,636

64,663

49,263

190,562

18.5 %

   Net interest income - tax equivalent

$ 157,114

$ 160,833

$ 160,742

$ 478,689

(2.3) %

Net interest margin

4.28 %

4.43 %

4.51 %

4.41 %

Net interest margin (fully tax equivalent) (1)

4.33 %

4.48 %

4.55 %

4.45 %

Full-time equivalent employees

2,121

2,193

2,066

(1) The tax equivalent adjustment to net interest income recognizes the income tax savings when comparing taxable and tax-exempt assets and assumes a 21% tax rate.  Management believes that it is a standard practice in the banking industry to present net interest income on a fully tax equivalent basis.  Therefore, management believes these measures provide useful information to investors by allowing them to make peer comparisons.  Management also uses these measures to make peer comparisons.

 

FIRST FINANCIAL BANCORP.

CONSOLIDATED QUARTERLY STATEMENTS OF INCOME

(Dollars in thousands, except per share data)

(Unaudited)

2022

Fourth

Third

Second

First

Full

Quarter

Quarter

Quarter

Quarter

Year

Interest income

  Loans and leases, including fees

$ 152,299

$  122,170

$   97,091

$   87,182

$  458,742

  Investment securities

     Taxable

30,248

26,331

23,639

22,096

102,314

     Tax-exempt

4,105

5,014

4,916

4,431

18,466

        Total investment securities interest

34,353

31,345

28,555

26,527

120,780

  Other earning assets

3,262

1,597

505

120

5,484

       Total interest income

189,914

155,112

126,151

113,829

585,006

Interest expense

  Deposits

16,168

6,386

2,963

2,623

28,140

  Short-term borrowings

11,091

6,158

1,566

317

19,132

  Long-term borrowings

4,759

4,676

4,612

4,544

18,591

      Total interest expense

32,018

17,220

9,141

7,484

65,863

      Net interest income

157,896

137,892

117,010

106,345

519,143

  Provision for credit losses-loans and leases

8,689

7,898

(4,267)

(5,589)

6,731

  Provision for credit losses-unfunded commitments

1,341

386

3,481

(226)

4,982

      Net interest income after provision for credit losses

147,866

129,608

117,796

112,160

507,430

Noninterest income

  Service charges on deposit accounts

6,406

6,279

7,648

7,729

28,062

  Wealth management fees

5,648

5,487

6,311

6,060

23,506

  Bankcard income

3,736

3,484

3,823

3,337

14,380

  Client derivative fees

1,822

1,447

1,369

803

5,441

  Foreign exchange income

19,592

11,752

13,470

10,151

54,965

  Leasing business income

11,124

7,127

7,247

6,076

31,574

  Net gains from sales of loans

2,206

3,729

5,241

3,872

15,048

  Net gain (loss) on sale of investment securities

(393)

(179)

0

3

(569)

  Net  gain (loss) on equity securities

1,315

(701)

(1,054)

(199)

(639)

  Other

4,579

4,109

5,723

3,462

17,873

      Total noninterest income

56,035

42,534

49,778

41,294

189,641

Noninterest expenses

  Salaries and employee benefits

73,621

66,808

64,992

63,947

269,368

  Net occupancy

5,434

5,669

5,359

5,746

22,208

  Furniture and equipment

3,234

3,222

3,201

3,567

13,224

  Data processing

8,567

8,497

8,334

8,264

33,662

  Marketing

2,198

2,523

2,323

1,700

8,744

  Communication

690

657

670

666

2,683

  Professional services

3,015

2,346

2,214

2,159

9,734

  State intangible tax

974

1,090

1,090

1,131

4,285

  FDIC assessments

2,173

1,885

1,677

1,459

7,194

  Intangible amortization

2,573

2,783

2,915

2,914

11,185

  Leasing business expense

6,061

5,746

4,687

3,869

20,363

  Other

15,902

23,842

5,572

7,383

52,699

      Total noninterest expenses

124,442

125,068

103,034

102,805

455,349

Income before income taxes

79,459

47,074

64,540

50,649

241,722

Income tax expense (benefit)

10,373

(8,631)

13,020

9,348

24,110

      Net income

$   69,086

$   55,705

$   51,520

$   41,301

$  217,612

ADDITIONAL DATA

Net earnings per share - basic

$      0.74

$      0.60

$      0.55

$      0.44

$       2.33

Net earnings per share - diluted

$      0.73

$      0.59

$      0.55

$      0.44

$       2.30

Dividends declared per share

$      0.23

$      0.23

$      0.23

$      0.23

$       0.92

Return on average assets

1.63 %

1.35 %

1.28 %

1.03 %

1.33 %

Return on average shareholders' equity

13.64 %

10.58 %

9.84 %

7.53 %

10.34 %

Interest income

$ 189,914

$  155,112

$  126,151

$  113,829

$  585,006

Tax equivalent adjustment

1,553

1,712

1,625

1,467

6,357

   Interest income - tax equivalent

191,467

156,824

127,776

115,296

591,363

Interest expense

32,018

17,220

9,141

7,484

65,863

   Net interest income - tax equivalent

$ 159,449

$  139,604

$  118,635

$  107,812

$  525,500

Net interest margin

4.43 %

3.93 %

3.41 %

3.11 %

3.73 %

Net interest margin (fully tax equivalent) (1)

4.47 %

3.98 %

3.45 %

3.16 %

3.77 %

Full-time equivalent employees

2,070

2,072

2,096

2,050

(1) The tax equivalent adjustment to net interest income recognizes the income tax savings when comparing taxable and tax-exempt assets and assumes a 21% tax rate.  Management believes that it is a standard practice in the banking industry to present net interest income on a fully tax equivalent basis.  Therefore, management believes these measures provide useful information to investors by allowing them to make peer comparisons.  Management also uses these measures to make peer comparisons.

 

FIRST FINANCIAL BANCORP.

CONSOLIDATED STATEMENTS OF CONDITION

(Dollars in thousands)

(Unaudited)

Sep. 30,

June 30,

Mar. 31,

Dec. 31,

Sep. 30,

% Change

% Change

2023

2023

2023

2022

2022

Linked Qtr.

Comp Qtr.

ASSETS

     Cash and due from banks

$      220,335

$      217,385

$      199,835

$      207,501

$      195,553

1.4 %

12.7 %

     Interest-bearing deposits with other banks

452,867

485,241

305,465

388,182

338,978

(6.7) %

33.6 %

     Investment securities available-for-sale

3,044,361

3,249,404

3,384,949

3,409,648

3,531,353

(6.3) %

(13.8) %

     Investment securities held-to-maturity

81,236

82,372

83,070

84,021

85,823

(1.4) %

(5.3) %

     Other investments

133,725

141,892

143,606

143,160

138,767

(5.8) %

(3.6) %

     Loans held for sale

12,391

15,267

9,280

7,918

10,684

(18.8) %

16.0 %

     Loans and leases

       Commercial and industrial

3,420,873

3,433,162

3,449,289

3,410,272

3,139,219

(0.4) %

9.0 %

       Lease financing

399,973

360,801

273,898

236,124

176,072

10.9 %

127.2 %

       Construction real estate

578,824

536,464

525,906

512,050

489,446

7.9 %

18.3 %

       Commercial real estate

3,992,654

4,048,460

4,056,627

4,052,759

3,976,345

(1.4) %

0.4 %

       Residential real estate

1,293,470

1,221,484

1,145,069

1,092,265

1,024,596

5.9 %

26.2 %

       Home equity

743,991

728,711

724,672

733,791

737,318

2.1 %

0.9 %

       Installment

160,648

165,216

204,372

209,895

202,267

(2.8) %

(20.6) %

       Credit card

56,386

55,911

53,552

51,815

52,173

0.8 %

8.1 %

          Total loans

10,646,819

10,550,209

10,433,385

10,298,971

9,797,436

0.9 %

8.7 %

       Less:

          Allowance for credit losses

(145,201)

(148,646)

(141,591)

(132,977)

(124,096)

(2.3) %

17.0 %

                Net loans

10,501,618

10,401,563

10,291,794

10,165,994

9,673,340

1.0 %

8.6 %

     Premises and equipment

192,572

192,077

188,959

189,080

189,067

0.3 %

1.9 %

     Operating leases

136,883

132,272

153,986

91,738

84,851

3.5 %

61.3 %

     Goodwill

1,005,868

1,005,828

1,005,738

1,001,507

998,422

0.0 %

0.7 %

     Other intangibles

86,378

88,662

91,169

93,919

96,528

(2.6) %

(10.5) %

     Accrued interest and other assets

1,186,618

1,078,186

1,076,033

1,220,648

1,280,427

10.1 %

(7.3) %

       Total Assets

$  17,054,852

$ 17,090,149

$  16,933,884

$ 17,003,316

$  16,623,793

(0.2) %

2.6 %

LIABILITIES

     Deposits

       Interest-bearing demand

$   2,880,617

$   2,919,472

$   2,761,811

$   3,037,153

$   2,980,465

(1.3) %

(3.4) %

       Savings

4,023,455

3,785,445

3,746,403

3,828,139

3,980,020

6.3 %

1.1 %

       Time

2,572,909

2,484,780

2,336,368

1,700,705

1,242,412

3.5 %

107.1 %

          Total interest-bearing deposits

9,476,981

9,189,697

8,844,582

8,565,997

8,202,897

3.1 %

15.5 %

       Noninterest-bearing

3,438,572

3,605,181

3,830,102

4,135,180

4,137,038

(4.6) %

(16.9) %

          Total deposits

12,915,553

12,794,878

12,674,684

12,701,177

12,339,935

0.9 %

4.7 %

     Federal funds purchased and securities sold

         under agreements to repurchase

0

0

0

0

3,535

0.0 %

100.0 %

     FHLB short-term borrowings

755,000

1,050,300

1,089,400

1,130,000

972,600

(28.1) %

(22.4) %

     Other

219,188

165,983

128,160

157,156

184,912

32.1 %

18.5 %

          Total short-term borrowings

974,188

1,216,283

1,217,560

1,287,156

1,161,047

(19.9) %

(16.1) %

     Long-term debt

340,902

339,963

342,647

346,672

355,116

0.3 %

(4.0) %

          Total borrowed funds

1,315,090

1,556,246

1,560,207

1,633,828

1,516,163

(15.5) %

(13.3) %

     Accrued interest and other liabilities

694,700

595,606

577,497

626,938

773,563

16.6 %

(10.2) %

       Total Liabilities

14,925,343

14,946,730

14,812,388

14,961,943

14,629,661

(0.1) %

2.0 %

SHAREHOLDERS' EQUITY

     Common stock

1,636,054

1,632,659

1,629,428

1,634,605

1,631,696

0.2 %

0.3 %

     Retained earnings

1,101,905

1,060,715

1,016,893

968,237

920,943

3.9 %

19.6 %

     Accumulated other comprehensive income (loss)

(410,005)

(353,010)

(328,059)

(358,663)

(354,570)

16.1 %

15.6 %

     Treasury stock, at cost

(198,445)

(196,945)

(196,766)

(202,806)

(203,937)

0.8 %

(2.7) %

       Total Shareholders' Equity

2,129,509

2,143,419

2,121,496

2,041,373

1,994,132

(0.6) %

6.8 %

       Total Liabilities and Shareholders' Equity

$  17,054,852

$ 17,090,149

$  16,933,884

$ 17,003,316

$  16,623,793

(0.2) %

2.6 %

 

FIRST FINANCIAL BANCORP.

AVERAGE CONSOLIDATED STATEMENTS OF CONDITION

(Dollars in thousands)

(Unaudited)

Quarterly Averages

Year-to-Date Averages

Sep. 30,

June 30,

Mar. 31,

Dec. 31,

Sep. 30,

Sep. 30,

2023

2023

2023

2022

2022

2023

2022

ASSETS

     Cash and due from banks

$      211,670

$      221,527

$      218,724

$      218,216

$      228,068

$      217,281

$      239,219

     Interest-bearing deposits with other banks

386,173

329,584

318,026

372,054

317,146

344,844

295,174

     Investment securities

3,394,237

3,560,453

3,635,317

3,705,304

4,003,472

3,529,119

4,142,157

     Loans held for sale

15,420

11,856

5,531

8,639

12,283

10,972

14,427

     Loans and leases

       Commercial and industrial

3,443,615

3,469,683

3,456,681

3,249,252

3,040,547

3,456,612

2,888,291

       Lease financing

371,598

323,819

252,219

203,790

158,667

316,316

136,392

       Construction real estate

547,884

518,190

536,294

501,787

469,489

534,165

468,108

       Commercial real estate

4,024,798

4,050,946

4,017,021

4,028,944

3,969,935

4,030,950

4,044,214

       Residential real estate

1,260,249

1,181,053

1,115,889

1,066,859

998,476

1,186,259

946,417

       Home equity

735,251

726,333

728,185

735,039

728,791

729,949

716,333

       Installment

164,092

172,147

205,934

208,484

164,063

180,571

143,403

       Credit card

60,827

59,478

55,548

56,325

54,946

58,637

54,222

          Total loans

10,608,314

10,501,649

10,367,771

10,050,480

9,584,914

10,493,459

9,397,380

       Less:

          Allowance for credit losses

(150,297)

(145,578)

(136,419)

(127,541)

(119,000)

(144,149)

(124,145)

                Net loans

10,458,017

10,356,071

10,231,352

9,922,939

9,465,914

10,349,310

9,273,235

     Premises and equipment

194,228

190,583

190,346

189,342

190,738

191,733

191,814

     Operating leases

132,984

138,725

107,092

88,365

83,970

126,362

73,126

     Goodwill

1,005,844

1,005,791

1,005,713

998,575

999,690

1,005,783

999,960

     Other intangibles

87,427

89,878

92,587

95,256

97,781

89,945

100,370

     Accrued interest and other assets

1,065,389

1,063,587

1,138,311

1,168,908

986,927

1,088,829

923,549

       Total Assets

$  16,951,389

$ 16,968,055

$  16,942,999

$  16,767,598

$  16,385,989

$  16,954,178

$  16,253,031

LIABILITIES

     Deposits

       Interest-bearing demand

$   2,927,416

$   2,906,855

$   2,906,712

$   3,103,091

$   3,105,547

$   2,913,737

$   3,177,253

       Savings

3,919,590

3,749,902

3,818,807

3,943,342

4,036,565

3,829,802

4,085,787

       Time

2,446,854

2,393,707

2,131,707

1,360,681

1,052,669

2,325,244

1,112,541

          Total interest-bearing deposits

9,293,860

9,050,464

8,857,226

8,407,114

8,194,781

9,068,783

8,375,581

       Noninterest-bearing

3,493,305

3,663,419

3,954,915

4,225,192

4,176,242

3,702,189

4,187,145

          Total deposits

12,787,165

12,713,883

12,812,141

12,632,306

12,371,023

12,770,972

12,562,726

     Federal funds purchased and securities sold

          under agreements to repurchase

10,788

21,881

26,380

16,167

32,637

19,626

34,028

     FHLB short-term borrowings

878,199

1,028,207

925,144

944,320

892,786

943,678

581,470

     Other

175,682

132,088

139,195

184,439

131,237

149,122

91,654

          Total short-term borrowings

1,064,669

1,182,176

1,090,719

1,144,926

1,056,660

1,112,426

707,152

     Long-term debt

338,402

341,523

343,619

344,162

350,058

341,162

364,693

       Total borrowed funds

1,403,071

1,523,699

1,434,338

1,489,088

1,406,718

1,453,588

1,071,845

     Accrued interest and other liabilities

607,552

592,708

614,310

636,640

519,069

604,831

480,845

       Total Liabilities

14,797,788

14,830,290

14,860,789

14,758,034

14,296,810

14,829,391

14,115,416

SHAREHOLDERS' EQUITY

     Common stock

1,634,102

1,631,230

1,633,396

1,632,941

1,631,078

1,632,912

1,635,103

     Retained earnings

1,076,515

1,034,092

989,777

941,987

899,524

1,033,779

869,574

     Accumulated other comprehensive loss

(358,769)

(330,263)

(339,450)

(361,284)

(236,566)

(342,898)

(156,047)

     Treasury stock, at cost

(198,247)

(197,294)

(201,513)

(204,080)

(204,857)

(199,006)

(211,015)

       Total Shareholders' Equity

2,153,601

2,137,765

2,082,210

2,009,564

2,089,179

2,124,787

2,137,615

       Total Liabilities and Shareholders' Equity

$  16,951,389

$ 16,968,055

$  16,942,999

$  16,767,598

$  16,385,989

$  16,954,178

$  16,253,031

 

FIRST FINANCIAL BANCORP.

NET INTEREST MARGIN RATE/VOLUME ANALYSIS

(Dollars in thousands)

(Unaudited)

 Quarterly Averages

Year-to-Date Averages

September 30, 2023

June 30, 2023

September 30, 2022

September 30, 2023

September 30, 2022

Balance

Interest

Yield

Balance

Interest

Yield

Balance

Interest

Yield

Balance

Yield

Balance

Yield

Earning assets

    Investments:

      Investment securities

$  3,394,237

$       34,819

4.07 %

$  3,560,453

$      35,575

4.01 %

$  4,003,472

$      31,345

3.11 %

$  3,529,119

4.01 %

$  4,142,157

2.79 %

      Interest-bearing deposits with other banks

386,173

5,011

5.15 %

329,584

3,933

4.79 %

317,146

1,597

2.00 %

344,844

4.84 %

295,174

1.01 %

    Gross loans (1)

10,623,734

192,261

7.18 %

10,513,505

184,387

7.03 %

9,597,197

122,170

5.05 %

10,504,431

6.95 %

9,411,807

4.35 %

       Total earning assets

14,404,144

232,091

6.39 %

14,403,542

223,895

6.23 %

13,917,815

155,112

4.42 %

14,378,394

6.18 %

13,849,138

3.81 %

Nonearning assets

    Allowance for credit losses

(150,297)

(145,578)

(119,000)

(144,149)

(124,145)

    Cash and due from banks

211,670

221,527

228,068

217,281

239,219

    Accrued interest and other assets

2,485,872

2,488,564

2,359,106

2,502,652

2,288,819

       Total assets

$ 16,951,389

$ 16,968,055

$ 16,385,989

$ 16,954,178

$ 16,253,031

Interest-bearing liabilities

    Deposits:

      Interest-bearing demand

$  2,927,416

$       12,953

1.76 %

$  2,906,855

$        8,351

1.15 %

$  3,105,547

$        2,404

0.31 %

$  2,913,737

1.28 %

$  3,177,253

0.16 %

      Savings

3,919,590

19,853

2.01 %

3,749,902

14,055

1.50 %

4,036,565

2,199

0.22 %

3,829,802

1.45 %

4,085,787

0.13 %

      Time

2,446,854

24,263

3.93 %

2,393,707

21,886

3.67 %

1,052,669

1,783

0.67 %

2,325,244

3.64 %

1,112,541

0.50 %

    Total interest-bearing deposits

9,293,860

57,069

2.44 %

9,050,464

44,292

1.96 %

8,194,781

6,386

0.31 %

9,068,783

1.96 %

8,375,581

0.19 %

    Borrowed funds

      Short-term borrowings

1,064,669

14,615

5.45 %

1,182,176

15,536

5.27 %

1,056,660

6,158

2.31 %

1,112,426

5.18 %

707,152

1.52 %

      Long-term debt

338,402

4,952

5.81 %

341,523

4,835

5.68 %

350,058

4,676

5.30 %

341,162

5.74 %

364,693

5.07 %

        Total borrowed funds

1,403,071

19,567

5.53 %

1,523,699

20,371

5.36 %

1,406,718

10,834

3.06 %

1,453,588

5.31 %

1,071,845

2.73 %

       Total interest-bearing liabilities

10,696,931

76,636

2.84 %

10,574,163

64,663

2.45 %

9,601,499

17,220

0.71 %

10,522,371

2.42 %

9,447,426

0.48 %

Noninterest-bearing liabilities

    Noninterest-bearing demand deposits

3,493,305

3,663,419

4,176,242

3,702,189

4,187,145

    Other liabilities

607,552

592,708

519,069

604,831

480,845

    Shareholders' equity

2,153,601

2,137,765

2,089,179

2,124,787

2,137,615

       Total liabilities & shareholders' equity

$ 16,951,389

$ 16,968,055

$ 16,385,989

$ 16,954,178

$ 16,253,031

Net interest income

$     155,455

$     159,232

$     137,892

$     474,005

$     361,247

Net interest spread

3.55 %

3.78 %

3.71 %

3.76 %

3.33 %

Net interest margin

4.28 %

4.43 %

3.93 %

4.41 %

3.49 %

Tax equivalent adjustment

0.05 %

0.05 %

0.05 %

0.04 %

0.04 %

Net interest margin (fully tax equivalent)

4.33 %

4.48 %

3.98 %

4.45 %

3.53 %

(1) Loans held for sale and nonaccrual loans are included in gross loans.

 

FIRST FINANCIAL BANCORP.

NET INTEREST MARGIN RATE/VOLUME ANALYSIS  (1)

(Dollars in thousands)

(Unaudited)

 Linked Qtr. Income Variance

 Comparable Qtr. Income Variance

Year-to-Date Income Variance

Rate

Volume

Total

Rate

Volume

Total

Rate

Volume

Total

Earning assets

    Investment securities

$        552

$    (1,308)

$      (756)

$     9,724

$    (6,250)

$      3,474

$    37,663

$  (18,365)

$    19,298

    Interest-bearing deposits with other banks

297

781

1,078

2,518

896

3,414

8,467

1,799

10,266

    Gross loans (2)

3,811

4,063

7,874

51,513

18,578

70,091

183,082

56,829

239,911

       Total earning assets

4,660

3,536

8,196

63,755

13,224

76,979

229,212

40,263

269,475

Interest-bearing liabilities

    Total interest-bearing deposits

$    10,678

$      2,099

$    12,777

$    43,934

$     6,749

$    50,683

$  110,693

$    10,152

$  120,845

    Borrowed funds

    Short-term borrowings

516

(1,437)

(921)

8,347

110

8,457

19,358

15,702

35,060

    Long-term debt

108

9

117

447

(171)

276

1,822

(1,010)

812

       Total borrowed funds

624

(1,428)

(804)

8,794

(61)

8,733

21,180

14,692

35,872

       Total interest-bearing liabilities

11,302

671

11,973

52,728

6,688

59,416

131,873

24,844

156,717

          Net interest income (1)

$    (6,642)

$      2,865

$    (3,777)

$    11,027

$     6,536

$    17,563

$    97,339

$    15,419

$  112,758

(1) Not tax equivalent.

(2) Loans held for sale and nonaccrual loans are included in gross loans.

 

FIRST FINANCIAL BANCORP.

CREDIT QUALITY

(Dollars in thousands)

(Unaudited)

Nine months ended,

Sep. 30,

June 30,

Mar. 31,

Dec. 31,

Sep. 30,

Sep. 30,

Sep. 30,

2023

2023

2023

2022

2022

2023

2022

ALLOWANCE FOR CREDIT LOSS ACTIVITY

Balance at beginning of period

$  148,646

$  141,591

$  132,977

$  124,096

$  117,885

$ 132,977

$ 131,992

  Provision for credit losses

12,907

12,719

8,644

8,689

7,898

34,270

(1,958)

  Gross charge-offs

    Commercial and industrial

9,207

2,372

730

334

1,947

12,309

5,565

    Lease financing

76

90

13

0

13

179

152

    Construction real estate

0

0

0

0

0

0

0

    Commercial real estate

6,008

2,648

66

245

3

8,722

3,422

    Residential real estate

10

20

0

79

119

30

145

    Home equity

54

21

91

72

45

166

88

    Installment

1,349

1,515

1,524

717

294

4,388

832

    Credit card

319

274

217

212

237

810

695

      Total gross charge-offs

17,023

6,940

2,641

1,659

2,658

26,604

10,899

  Recoveries

    Commercial and industrial

335

631

109

293

90

1,075

646

    Lease financing

1

1

1

0

13

3

49

    Construction real estate

0

0

0

0

0

0

0

    Commercial real estate

39

153

2,238

1,327

561

2,430

2,977

    Residential real estate

44

113

66

15

35

223

159

    Home equity

125

232

80

88

185

437

810

    Installment

87

90

54

68

29

231

97

    Credit card

40

56

63

60

58

159

223

      Total recoveries

671

1,276

2,611

1,851

971

4,558

4,961

  Total net charge-offs

16,352

5,664

30

(192)

1,687

22,046

5,938

Ending allowance for credit losses

$  145,201

$  148,646

$  141,591

$  132,977

$  124,096

$ 145,201

$ 124,096

NET CHARGE-OFFS TO AVERAGE LOANS AND LEASES (ANNUALIZED)

  Commercial and industrial

1.02 %

0.20 %

0.07 %

0.01 %

0.24 %

0.43 %

0.23 %

  Lease financing

0.08 %

0.11 %

0.02 %

0.00 %

0.00 %

0.07 %

0.10 %

  Construction real estate

0.00 %

0.00 %

0.00 %

0.00 %

0.00 %

0.00 %

0.00 %

  Commercial real estate

0.59 %

0.25 %

(0.22) %

(0.11) %

(0.06) %

0.21 %

0.01 %

  Residential real estate

(0.01) %

(0.03) %

(0.02) %

0.02 %

0.03 %

(0.02) %

0.00 %

  Home equity

(0.04) %

(0.12) %

0.01 %

(0.01) %

(0.08) %

(0.05) %

(0.13) %

  Installment

3.05 %

3.32 %

2.89 %

1.24 %

0.64 %

3.08 %

0.69 %

  Credit card

1.82 %

1.47 %

1.12 %

1.07 %

1.29 %

1.48 %

1.16 %

     Total net charge-offs

0.61 %

0.22 %

0.00 %

(0.01) %

0.07 %

0.28 %

0.08 %

COMPONENTS OF NONPERFORMING LOANS, NONPERFORMING ASSETS, AND UNDERPERFORMING ASSETS

  Nonaccrual loans (1)

    Commercial and industrial

$    17,152

$    21,508

$    13,971

$     8,242

$     8,719

$   17,152

$     8,719

    Lease financing

7,731

4,833

175

178

199

7,731

199

    Construction real estate

0

0

0

0

0

0

0

    Commercial real estate

33,019

11,876

5,362

5,786

13,435

33,019

13,435

    Residential real estate

12,328

11,697

11,129

10,691

10,250

12,328

10,250

    Home equity

3,937

3,239

3,399

3,123

3,445

3,937

3,445

    Installment

774

568

544

603

279

774

279

      Nonaccrual loans

74,941

53,721

34,580

28,623

36,327

74,941

36,327

  Accruing troubled debt restructurings (TDRs) (2)

N/A

N/A

N/A

10,960

11,022

N/A

11,022

     Total nonperforming loans (2)

74,941

53,721

34,580

39,583

47,349

74,941

47,349

  Other real estate owned (OREO)

142

281

191

191

22

142

22

     Total nonperforming assets (2)

75,083

54,002

34,771

39,774

47,371

75,083

47,371

  Accruing loans past due 90 days or more

698

873

159

857

139

698

139

     Total underperforming assets (2)

$    75,781

$    54,875

$    34,930

$    40,631

$    47,510

$   75,781

$   47,510

Total classified assets (2)

$  140,552

$  138,909

$  158,984

$  128,137

$  114,956

$ 140,552

$ 114,956

CREDIT QUALITY RATIOS

Allowance for credit losses to

     Nonaccrual loans

193.75 %

276.70 %

409.46 %

464.58 %

341.61 %

193.75 %

341.61 %

     Nonperforming loans

193.75 %

276.70 %

409.46 %

335.94 %

262.09 %

193.75 %

262.09 %

     Total ending loans

1.36 %

1.41 %

1.36 %

1.29 %

1.27 %

1.36 %

1.27 %

Nonperforming loans to total loans

0.70 %

0.51 %

0.33 %

0.38 %

0.48 %

0.70 %

0.48 %

Nonaccrual loans to total loans

0.70 %

0.51 %

0.33 %

0.28 %

0.37 %

0.70 %

0.37 %

Nonperforming assets to

     Ending loans, plus OREO

0.71 %

0.51 %

0.33 %

0.39 %

0.48 %

0.71 %

0.48 %

     Total assets

0.44 %

0.32 %

0.21 %

0.23 %

0.28 %

0.44 %

0.28 %

Nonperforming assets, excluding accruing TDRs to

     Ending loans, plus OREO

0.71 %

0.51 %

0.33 %

0.28 %

0.37 %

0.71 %

0.37 %

     Total assets

0.44 %

0.32 %

0.21 %

0.17 %

0.22 %

0.44 %

0.22 %

Classified assets to total assets

0.82 %

0.81 %

0.94 %

0.75 %

0.69 %

0.82 %

0.69 %

(1)  Nonaccrual loans include nonaccrual TDRs of $10.0 million and $12.8 million, as of December 31, 2022 and  September 30, 2022, respectively.

(2)  Upon adoption of ASU 2022-02 as of January 1, 2023, the TDR model was eliminated.  Prospectively, disclosures will include modifications of loans to borrowers experiencing financial difficulty (FDM).  FDMs are excluded from nonperforming, underperforming and classified assets. 

 

FIRST FINANCIAL BANCORP.

CAPITAL ADEQUACY

(Dollars in thousands, except per share data)

(Unaudited)

Nine months ended,

Sep. 30,

June 30,

Mar. 31,

Dec. 31,

Sep. 30,

Sep. 30,

Sep. 30,

2023

2023

2023

2022

2022

2023

2022

PER COMMON SHARE

Market Price

  High

$        24.02

$        22.27

$        26.24

$        26.68

$        23.75

$      26.24

$     26.73

  Low

$        19.19

$        18.20

$        21.30

$        21.56

$        19.02

$      18.20

$     19.02

  Close

$        19.60

$        20.44

$        21.77

$        24.23

$        21.08

$      19.60

$     21.08

Average shares outstanding - basic

94,030,275

93,924,068

93,732,532

93,590,674

93,582,250

93,896,716

93,507,831

Average shares outstanding - diluted

95,126,269

95,169,348

94,960,158

94,831,788

94,793,766

95,085,871

94,504,453

Ending shares outstanding

95,117,180

95,185,483

95,190,406

94,891,099

94,833,964

95,117,180

94,833,964

Total shareholders' equity

$  2,129,509

$  2,143,419

$  2,121,496

$  2,041,373

$  1,994,132

$                  2,129,509

$                  1,994,132

REGULATORY CAPITAL

Preliminary

Preliminary

Common equity tier 1 capital

$  1,527,793

$  1,481,913

$  1,432,332

$  1,399,420

$  1,348,413

$     1,527,793

$   1,348,413

Common equity tier 1 capital ratio

11.60 %

11.34 %

11.00 %

10.83 %

10.82 %

11.60 %

10.82 %

Tier 1 capital

$  1,572,248

$  1,526,362

$  1,476,734

$  1,443,698

$  1,392,565

$   1,572,248

$     1,392,565

Tier 1 ratio

11.94 %

11.68 %

11.34 %

11.17 %

11.17 %

11.94 %

11.17 %

Total capital

$  1,778,993

$  1,756,968

$  1,707,270

$  1,691,255

$  1,640,052

$    1,778,993

$ 1,640,052

Total capital ratio

13.51 %

13.44 %

13.11 %

13.09 %

13.15 %

13.51 %

13.15 %

Total capital in excess of minimum requirement

$     396,083

$     384,735

$     339,585

$    334,316

$    330,973

$  396,083

$ 330,973

Total risk-weighted assets

$  13,170,574

$  13,068,888

$  13,025,567

$  12,923,233

$  12,467,422

$  13,170,574

$  12,467,422

Leverage ratio

9.59 %

9.33 %

9.03 %

8.89 %

8.88 %

9.59 %

8.88 %

OTHER CAPITAL RATIOS

Ending shareholders' equity to ending assets

12.49 %

12.54 %

12.53 %

12.01 %

12.00 %

12.49 %

12.00 %

Ending tangible shareholders' equity to ending tangible assets (1)

6.50 %

6.56 %

6.47 %

5.95 %

5.79 %

6.50 %

5.79 %

Average shareholders' equity to average assets

12.70 %

12.60 %

12.29 %

11.98 %

12.75 %

12.53 %

13.15 %

Average tangible shareholders' equity to average tangible assets (1)

6.69 %

6.57 %

6.21 %

5.84 %

6.49 %

6.49 %

6.85 %

REPURCHASE PROGRAM (2)

Shares repurchased

0

0

0

0

0

0

0

Average share repurchase price

N/A

N/A

N/A

N/A

N/A

N/A

N/A

Total cost of shares repurchased

N/A

N/A

N/A

N/A

N/A

N/A

N/A

(1) Non-GAAP measure.  For details on the calculation of these non-GAAP financial measures and a reconciliation to the GAAP financial measure, see the sections titled "Use of Non-GAAP Financial Measures" in this release and "Appendix: Non-GAAP to GAAP Reconciliation" in the accompanying slide presentation.

(2) Represents share repurchases as part of publicly announced plans.

N/A = Not applicable

 

Cision View original content:https://www.prnewswire.com/news-releases/first-financial-bancorp-announces-third-quarter-2023-financial-results-and-quarterly-dividend-301966141.html

SOURCE First Financial Bancorp.