First Financial Bancorp.NASDAQ: FFBC

First Financial Bancorp Announces Fourth Quarter and Full Year 2019 Financial Results

· Issued by First Financial Bancorp. via PR Newswire
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- Fourth Quarter 2019 Earnings per Diluted Share of $0.49; $0.52 on an Adjusted Basis

- 32.6% Decline in Classified Assets

- 6.0% Loan Growth on an Annualized Basis

- 8.1% Average Deposit Growth on an Annualized Basis

- 3.89% Fully Tax Equivalent Net Interest Margin

CINCINNATI, Jan. 23, 2020 /PRNewswire/ -- First Financial Bancorp. (Nasdaq: FFBC) ("First Financial" or the "Company") announced financial results for the fourth quarter 2019.

For the three months ended December 31, 2019, the Company reported net income of $48.7 million, or $0.49 per diluted common share.  These results compare to net income of $50.9 million, or $0.51 per diluted common share, for the third quarter of 2019 and $55.0 million, or $0.56 per diluted common share, for the fourth quarter of 2018.  For the twelve months ended December 31, 2019, First Financial had earnings per diluted common share of $2.00 compared to $1.93 for the same period in 2018.

Return on average assets for the fourth quarter of 2019 was 1.34% while return on average tangible common equity was 15.84%.  These compare to returns on average assets of 1.41% and 1.59%, and returns on average tangible common equity of 16.15% and 19.63%, in the third quarter of 2019 and the fourth quarter of 2018, respectively.

Fourth quarter 2019 highlights include:

  • After adjustments(1) for merger-related and nonrecurring items:
    • Net income of $0.52 per diluted common share
    • 1.41% return on average assets; 16.73% return on average tangible common equity 
  • Adjustments to net income include:
    • $0.7 million of severance and other merger related costs
    • $2.9 million historic tax credit investment write-down; offset by impact to income taxes
    • $1.7 million of other nonrecurring costs such as branch consolidation costs
    • $0.7 million of taxes on merger-related executive compensation
  • Loan balances grew 6.0% on an annualized basis
    • $138.0 million increase compared to the linked quarter driven by commercial real estate
  • Average deposit balances grew 8.1% on an annualized basis
    • Noninterest bearing demand deposits grew 19.8% on an annualized basis
  • Net interest margin of 3.89% on a fully tax-equivalent basis(1)
    • 7 basis point reduction from the linked quarter
    • Impact of lower interest rates on asset yields partially offset by funding cost reductions and favorable shift in funding mix
  • Noninterest income of $36.8 million
    • Positively impacted by full quarter impact of Bannockburn acquisition, strong mortgage banking activity and client derivative fees

(1)

Financial information in this release that is described as "adjusted" or that is presented on a fully tax equivalent basis is non-GAAP.  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.

  • Noninterest expenses of $93.1 million, or $87.8 million as adjusted(1)
    • Efficiency ratio of 59.8%; 56.4% as adjusted(1)
    • Includes $1.7 million of additional incentive compensation due to strong operating results
    • $0.4 million contribution to First Financial Foundation
    • $0.8 million of additional collection expenses in fourth quarter
  • Significant decline in nonperforming and classified asset levels; ALLL relatively flat at $57.7 million, or 0.63% of loans; Provision expense sufficient to cover net charge-offs and loan growth
  • Strong capital ratios
    • Total capital of 13.39%; Tier 1 common equity of 11.30%; Tangible common equity of 9.07%
    • Tangible book value per share of $12.42

Archie Brown, President and Chief Executive Officer, commented, "We are very pleased to announce fourth quarter results that are highlighted by strong earnings, record loan originations, improved loan growth and a significant reduction in classified assets."

Mr. Brown continued, "A 31% increase in loan originations from the linked quarter resulted in 6.0% annualized loan growth.  This was our strongest quarter to date in loan volume with originations increasing across most of our portfolios, led by Commercial Real Estate and Commercial loans.  Net interest margin was once again at the high end of our expectations as our proactive funding cost management partially offset lower asset yields following the third rate cut in four months in October.  Credit quality trends significantly improved as net charge-offs normalized during the period and we resolved a number of problem loans, resulting in significantly lower classified asset balances."

Mr. Brown further remarked, "The full quarter impact of the Bannockburn acquisition along with near record level client derivative fees and sustained mortgage banking volume drove noninterest income higher.  Expenses were elevated during the period primarily due to the write-down of a historic tax credit investment and higher incentive compensation resulting from our strong operating results, however our adjusted efficiency ratio was in line with our stated expectations and reflects our deliberate expense management efforts."

Mr. Brown concluded, "2019 was another successful year for First Financial. The year was highlighted by record earnings, top quartile returns, shareholder-focused capital actions and the Bannockburn acquisition despite headwinds from the Fed rate cuts and increased credit costs related to one loan in our Franchise portfolio. Our success is a direct reflection of the work performed by our associates.  Their resolve and dedication to delivering unparalleled service to our clients and return to our shareholders embodies our organizational values and they have worked tirelessly to establish themselves and First Financial as valued partners in our communities.  Due to their continued efforts and commitment I remain confident in our ability to sustain this success into 2020 and beyond."

Full detail of the Company's fourth quarter and full year 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 Friday, January 24, 2020 at 8:30 a.m. Eastern Time.  Members of the public who would like to listen to the conference call should dial (877) 506-6873 (U.S. toll free), (855) 669-9657 (Canada toll free) or +1 (412) 380-2003 (International) (no passcode required).  The number should be dialed five to ten minutes prior to the start of the conference call.  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.  A replay of the conference call will be available beginning one hour after the completion of the live call at (877) 344-7529 (U.S. toll free), (855) 669-9658 (Canada toll free) and +1 (412) 317-0088 (International); conference number 10137978.  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 StatementCertain 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: (i) economic, market, liquidity, credit, interest rate, operational and technological risks associated with the Company's business; (ii) 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; (iii) management's ability to effectively execute its business plans; (iv) mergers and acquisitions, including costs or difficulties related to the integration of acquired companies; (v) the possibility that any of the anticipated benefits of the Company's merger with MainSource Financial Group, Inc. will not be realized or will not be realized within the expected time period; (vi) the effect of changes in accounting policies and practices; (vii) changes in consumer spending, borrowing and saving and changes in unemployment; (viii) changes in customers' performance and creditworthiness; and (ix) the costs and effects of litigation and of unexpected or adverse outcomes in such litigation.  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, 2018, 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 December 31, 2019, the Company had $14.5 billion in assets, $9.2 billion in loans, $10.2 billion in deposits and $2.2 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 $2.9 billion in assets under management as of December 31, 2019.  The Company operated 145 full service banking centers as of December 31, 2019, primarily in Ohio, Indiana and Kentucky, 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,

Twelve months ended,

Dec. 31,

Sep. 30,

Jun. 30,

Mar. 31,

Dec. 31,

Dec. 31,

2019

2019

2019

2019

2018

2019

2018

RESULTS OF OPERATIONS

Net income

$

48,677

$

50,856

$

52,703

$

45,839

$

55,014

$

198,075

$

172,595

Net earnings per share - basic

$

0.49

$

0.52

$

0.54

$

0.47

$

0.56

$

2.01

$

1.95

Net earnings per share - diluted

$

0.49

$

0.51

$

0.53

$

0.47

$

0.56

$

2.00

$

1.93

Dividends declared per share

$

0.23

$

0.23

$

0.22

$

0.22

$

0.20

$

0.90

$

0.78

KEY FINANCIAL RATIOS

Return on average assets

1.34

%

1.41

%

1.50

%

1.33

%

1.59

%

1.39

%

1.37

%

Return on average shareholders' equity

8.60

%

9.13

%

9.85

%

8.88

%

10.68

%

9.11

%

9.85

%

Return on average tangible shareholders' equity

15.84

%

16.15

%

17.33

%

15.95

%

19.63

%

16.32

%

17.32

%

Net interest margin

3.84

%

3.91

%

3.99

%

4.05

%

4.16

%

3.95

%

4.05

%

Net interest margin (fully tax equivalent) (1)

3.89

%

3.96

%

4.04

%

4.10

%

4.21

%

4.00

%

4.10

%

Ending shareholders' equity as a percent of ending assets

15.49

%

15.62

%

15.16

%

15.14

%

14.86

%

15.49

%

14.86

%

Ending tangible shareholders' equity as a percent of:

Ending tangible assets

9.07

%

9.17

%

9.34

%

9.15

%

8.79

%

9.07

%

8.79

%

Risk-weighted assets

11.09

%

11.34

%

11.82

%

11.61

%

11.20

%

11.09

%

11.20

%

Average shareholders' equity as a percent of average assets

15.53

%

15.43

%

15.22

%

15.01

%

14.84

%

15.30

%

13.89

%

Average tangible shareholders' equity as a percent of

    average tangible assets

9.07

%

9.35

%

9.26

%

8.95

%

8.66

%

9.16

%

8.40

%

Book value per share

$

22.82

$

22.59

$

22.18

$

21.60

$

21.23

$

22.82

$

21.23

Tangible book value per share

$

12.42

$

12.33

$

12.79

$

12.19

$

11.72

$

12.42

$

11.72

Common equity tier 1 ratio (2)

11.30

%

11.52

%

12.00

%

12.03

%

11.87

%

11.30

%

11.87

%

Tier 1 ratio (2)

11.69

%

11.91

%

12.40

%

12.43

%

12.28

%

11.69

%

12.28

%

Total capital ratio (2)

13.39

%

13.62

%

14.20

%

14.24

%

14.10

%

13.39

%

14.10

%

Leverage ratio (2)

9.58

%

9.75

%

10.02

%

9.84

%

9.71

%

9.58

%

9.71

%

AVERAGE BALANCE SHEET ITEMS

Loans (3)

$

9,149,222

$

9,014,092

$

8,852,662

$

8,773,310

$

8,766,302

$

8,948,535

$

8,151,068

Investment securities

3,102,867

3,290,666

3,408,994

3,355,732

3,204,758

3,288,875

2,897,167

Interest-bearing deposits with other banks

36,672

38,569

33,255

34,709

32,013

35,814

32,090

  Total earning assets

$

12,288,761

$

12,343,327

$

12,294,911

$

12,163,751

$

12,003,073

$

12,273,224

$

11,080,325

Total assets

$

14,460,288

$

14,320,514

$

14,102,733

$

13,952,551

$

13,768,958

$

14,210,719

$

12,611,438

Noninterest-bearing deposits

$

2,638,908

$

2,513,458

$

2,484,214

$

2,457,587

$

2,476,773

$

2,524,011

$

2,217,349

Interest-bearing deposits

7,583,531

7,504,708

7,612,146

7,610,092

7,573,069

7,577,347

7,098,836

  Total deposits

$

10,222,439

$

10,018,166

$

10,096,360

$

10,067,679

$

10,049,842

$

10,101,358

$

9,316,185

Borrowings

$

1,613,696

$

1,816,983

$

1,656,570

$

1,587,068

$

1,509,642

$

1,669,059

$

1,385,994

Shareholders' equity

$

2,245,107

$

2,210,327

$

2,146,997

$

2,094,234

$

2,042,884

$

2,174,679

$

1,752,261

CREDIT QUALITY RATIOS

Allowance to ending loans

0.63

%

0.62

%

0.69

%

0.64

%

0.64

%

0.63

%

0.64

%

Allowance to nonaccrual loans

119.69

%

93.18

%

119.86

%

95.40

%

79.97

%

119.69

%

79.97

%

Allowance to nonperforming loans

96.73

%

71.46

%

69.33

%

68.94

%

65.13

%

96.73

%

65.13

%

Nonperforming loans to total loans

0.65

%

0.87

%

0.99

%

0.93

%

0.98

%

0.65

%

0.98

%

Nonperforming assets to ending loans, plus OREO

0.67

%

0.89

%

1.00

%

0.95

%

1.00

%

0.67

%

1.00

%

Nonperforming assets to total assets

0.42

%

0.56

%

0.62

%

0.60

%

0.63

%

0.42

%

0.63

%

Classified assets to total assets

0.62

%

0.92

%

1.02

%

1.01

%

0.94

%

0.62

%

0.94

%

Net charge-offs to average loans (annualized)

0.15

%

0.45

%

0.08

%

0.64

%

0.29

%

0.33

%

0.15

%

(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 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.

(2) December 31, 2019 regulatory capital ratios are preliminary.

(3) Includes loans held for sale.

FIRST FINANCIAL BANCORP.

CONSOLIDATED STATEMENTS OF INCOME

(Dollars in thousands, except per share data)

(Unaudited)

Three months ended,

Twelve months ended,

Dec. 31,

Dec. 31,

2019

2018

% Change

2019

2018

% Change

Interest income

  Loans and leases, including fees

$

122,802

$

126,580

(3.0)

%

$

499,009

$

447,187

11.6

%

  Investment securities

     Taxable

20,137

22,761

(11.5)

%

90,168

79,076

14.0

%

     Tax-exempt

4,545

3,896

16.7

%

17,596

13,428

31.0

%

        Total investment securities interest

24,682

26,657

(7.4)

%

107,764

92,504

16.5

%

  Other earning assets

167

192

(13.0)

%

805

691

16.5

%

       Total interest income

147,651

153,429

(3.8)

%

607,578

540,382

12.4

%

Interest expense

  Deposits

19,026

17,198

10.6

%

79,032

56,962

38.7

%

  Short-term borrowings

5,430

5,186

4.7

%

25,235

18,033

39.9

%

  Long-term borrowings

4,293

5,086

(15.6)

%

19,057

16,152

18.0

%

      Total interest expense

28,749

27,470

4.7

%

123,324

91,147

35.3

%

      Net interest income

118,902

125,959

(5.6)

%

484,254

449,235

7.8

%

  Provision for loan and lease losses

4,629

5,310

(12.8)

%

30,598

14,586

109.8

%

      Net interest income after provision for loan and lease losses

114,273

120,649

(5.3)

%

453,656

434,649

4.4

%

Noninterest income

  Service charges on deposit accounts

9,343

10,185

(8.3)

%

37,939

35,108

8.1

%

  Trust and wealth management fees

3,913

3,703

5.7

%

15,644

15,082

3.7

%

  Bankcard income

3,405

6,247

(45.5)

%

18,804

20,245

(7.1)

%

  Client derivative fees

4,194

1,433

192.7

%

15,662

7,682

103.9

%

  Foreign exchange income

6,014

0

100.0

%

7,739

0

100.0

%

  Net gains from sales of loans

4,723

1,428

230.7

%

14,851

6,071

144.6

%

  Net gains (losses) on sale of investment securities

(296)

36

(922.2)

%

(406)

(161)

(152.2)

%

  Other

5,472

6,472

(15.5)

%

21,140

19,355

9.2

%

      Total noninterest income

36,768

29,504

24.6

%

131,373

103,382

27.1

%

Noninterest expenses

  Salaries and employee benefits

53,952

51,505

4.8

%

209,061

188,990

10.6

%

  Net occupancy

6,334

6,322

0.2

%

24,069

24,215

(0.6)

%

  Furniture and equipment

4,145

3,498

18.5

%

15,903

14,908

6.7

%

  Data processing

5,996

5,599

7.1

%

21,881

28,077

(22.1)

%

  Marketing

1,980

1,651

19.9

%

6,908

7,598

(9.1)

%

  Communication

882

805

9.6

%

3,267

3,167

3.2

%

  Professional services

2,192

1,794

22.2

%

11,254

12,272

(8.3)

%

  State intangible tax

1,767

1,086

62.7

%

5,829

4,152

40.4

%

  FDIC assessments

1,055

1,018

3.6

%

1,973

3,969

(50.3)

%

  Intangible amortization

3,150

2,229

41.3

%

9,671

7,359

31.4

%

  Other

11,611

7,845

48.0

%

32,351

29,103

11.2

%

      Total noninterest expenses

93,064

83,352

11.7

%

342,167

323,810

5.7

%

Income before income taxes

57,977

66,801

(13.2)

%

242,862

214,221

13.4

%

Income tax expense

9,300

11,787

(21.1)

%

44,787

41,626

7.6

%

      Net income

$

48,677

$

55,014

(11.5)

%

$

198,075

$

172,595

14.8

%

ADDITIONAL DATA

Net earnings per share - basic

$

0.49

$

0.56

$

2.01

$

1.95

Net earnings per share - diluted

$

0.49

$

0.56

$

2.00

$

1.93

Dividends declared per share

$

0.23

$

0.20

$

0.90

$

0.78

Return on average assets

1.34

%

1.59

%

1.39

%

1.37

%

Return on average shareholders' equity

8.60

%

10.68

%

9.11

%

9.85

%

Interest income

$

147,651

$

153,429

(3.8)

%

$

607,578

$

540,382

12.4

%

Tax equivalent adjustment

1,630

1,442

13.0

%

6,328

5,147

22.9

%

   Interest income - tax equivalent

149,281

154,871

(3.6)

%

613,906

545,529

12.5

%

Interest expense

28,749

27,470

4.7

%

123,324

91,147

35.3

%

   Net interest income - tax equivalent

$

120,532

$

127,401

(5.4)

%

$

490,582

$

454,382

8.0

%

Net interest margin

3.84

%

4.16

%

3.95

%

4.05

%

Net interest margin (fully tax equivalent) (1)

3.89

%

4.21

%

4.00

%

4.10

%

Full-time equivalent employees

2,065

2,073

(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)

2019

Fourth

Third

Second

First

Full

% Change

Quarter

Quarter

Quarter

Quarter

Year

Linked Qtr.

Interest income

  Loans and leases, including fees

$

122,802

$

126,786

$

126,365

$

123,056

$

499,009

(3.1)

%

  Investment securities

     Taxable

20,137

22,180

23,616

24,235

90,168

(9.2)

%

     Tax-exempt

4,545

4,457

4,336

4,258

17,596

2.0

%

        Total investment securities interest

24,682

26,637

27,952

28,493

107,764

(7.3)

%

  Other earning assets

167

222

206

210

805

(24.8)

%

       Total interest income

147,651

153,645

154,523

151,759

607,578

(3.9)

%

Interest expense

  Deposits

19,026

20,151

20,612

19,243

79,032

(5.6)

%

  Short-term borrowings

5,430

7,199

6,646

5,960

25,235

(24.6)

%

  Long-term borrowings

4,293

4,760

4,963

5,041

19,057

(9.8)

%

      Total interest expense

28,749

32,110

32,221

30,244

123,324

(10.5)

%

      Net interest income

118,902

121,535

122,302

121,515

484,254

(2.2)

%

  Provision for loan and lease losses

4,629

5,228

6,658

14,083

30,598

(11.5)

%

      Net interest income after provision for loan and lease losses

114,273

116,307

115,644

107,432

453,656

(1.7)

%

Noninterest income

  Service charges on deposit accounts

9,343

9,874

9,819

8,903

37,939

(5.4)

%

  Trust and wealth management fees

3,913

3,718

3,943

4,070

15,644

5.2

%

  Bankcard income

3,405

3,316

6,497

5,586

18,804

2.7

%

  Client derivative fees

4,194

4,859

4,905

1,704

15,662

(13.7)

%

  Foreign exchange income

6,014

1,708

17

0

7,739

252.1

%

  Net gains from sales of loans

4,723

4,806

3,432

1,890

14,851

(1.7)

%

  Net gains (losses) on sale of investment securities

(296)

105

(37)

(178)

(406)

381.9

%

  Other

5,472

4,754

6,062

4,852

21,140

15.1

%

      Total noninterest income

36,768

33,140

34,638

26,827

131,373

10.9

%

Noninterest expenses

  Salaries and employee benefits

53,952

53,212

53,985

47,912

209,061

1.4

%

  Net occupancy

6,334

5,509

5,596

6,630

24,069

15.0

%

  Furniture and equipment

4,145

4,120

4,222

3,416

15,903

0.6

%

  Data processing

5,996

5,774

4,984

5,127

21,881

3.8

%

  Marketing

1,980

1,346

1,976

1,606

6,908

47.1

%

  Communication

882

910

747

728

3,267

(3.1)

%

  Professional services

2,192

4,771

2,039

2,252

11,254

(54.1)

%

  State intangible tax

1,767

1,445

1,307

1,310

5,829

22.3

%

  FDIC assessments

1,055

(1,097)

1,065

950

1,973

(196.2)

%

  Intangible amortization

3,150

2,432

2,044

2,045

9,671

29.5

%

  Other

11,611

7,804

6,413

6,523

32,351

48.8

%

      Total noninterest expenses

93,064

86,226

84,378

78,499

342,167

7.9

%

Income before income taxes

57,977

63,221

65,904

55,760

242,862

(8.3)

%

Income tax expense

9,300

12,365

13,201

9,921

44,787

(24.8)

%

      Net income

$

48,677

$

50,856

$

52,703

$

45,839

$

198,075

(4.3)

%

ADDITIONAL DATA

Net earnings per share - basic

$

0.49

$

0.52

$

0.54

$

0.47

$

2.01

Net earnings per share - diluted

$

0.49

$

0.51

$

0.53

$

0.47

$

2.00

Dividends declared per share

$

0.23

$

0.23

$

0.22

$

0.22

$

0.90

Return on average assets

1.34

%

1.41

%

1.50

%

1.33

%

1.39

%

Return on average shareholders' equity

8.60

%

9.13

%

9.85

%

8.88

%

9.11

%

Interest income

$

147,651

$

153,645

$

154.523

$

151,759

$

607,578

(3.9)

%

Tax equivalent adjustment

1,630

1,759

1.416

1,523

6,328

(7.3)

%

   Interest income - tax equivalent

149,281

155,404

155.939

153,282

613,906

(3.9)

%

Interest expense

28,749

32,110

32.221

30,244

123,324

(10.5)

%

   Net interest income - tax equivalent

$

120,532

$

123,294

$

123.718

$

123,038

$

490,582

(2.2)

%

Net interest margin

3.84

%

3.91

%

3.99

%

4.05

%

3.95

%

Net interest margin (fully tax equivalent) (1)

3.89

%

3.96

%

4.04

%

4.10

%

4.00

%

Full-time equivalent employees

2,065

2,064

2,076

2,087

(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)

2018

Fourth

Third

Second

First

Full

Quarter

Quarter

Quarter

Quarter

Year

Interest income

  Loans and leases, including fees

$

126,580

$

123,397

$

122,290

$

74,920

$

447,187

  Investment securities

     Taxable

22,761

21,801

20,844

13,670

79,076

     Tax-exempt

3,896

3,807

4,068

1,657

13,428

        Total investment securities interest

26,657

25,608

24,912

15,327

92,504

  Other earning assets

192

215

177

107

691

       Total interest income

153,429

149,220

147,379

90,354

540,382

Interest expense

  Deposits

17,198

14,672

14,794

10,298

56,962

  Short-term borrowings

5,186

6,052

4,132

2,663

18,033

  Long-term borrowings

5,086

5,011

4,474

1,581

16,152

      Total interest expense

27,470

25,735

23,400

14,542

91,147

      Net interest income

125,959

123,485

123,979

75,812

449,235

  Provision for loan and lease losses

5,310

3,238

3,735

2,303

14,586

      Net interest income after provision for loan and lease losses

120,649

120,247

120,244

73,509

434,649

Noninterest income

  Service charges on deposit accounts

10,185

10,316

9,568

5,039

35,108

  Trust and wealth management fees

3,703

3,728

3,697

3,954

15,082

  Bankcard income

6,247

5,261

5,343

3,394

20,245

  Client derivative fees

1,433

3,029

1,463

1,757

7,682

  Net gains from sales of loans

1,428

1,739

2,316

588

6,071

  Net gains on sale of investment securities

36

(167)

(30)

0

(161)

  Other

6,472

4,778

5,899

2,206

19,355

      Total noninterest income

29,504

28,684

28,256

16,938

103,382

Noninterest expenses

  Salaries and employee benefits

51,505

50,852

55,531

31,102

188,990

  Net occupancy

6,322

6,765

6,631

4,497

24,215

  Furniture and equipment

3,498

4,072

5,298

2,040

14,908

  Data processing

5,599

4,502

14,304

3,672

28,077

  Marketing

1,651

2,502

2,644

801

7,598

  Communication

805

785

1,118

459

3,167

  Professional services

1,794

2,621

5,659

2,198

12,272

  State intangible tax

1,086

1,223

1,078

765

4,152

  FDIC assessments

1,018

734

1,323

894

3,969

  Intangible amortization

2,229

2,486

2,364

280

7,359

  Other

7,845

8,873

6,805

5,580

29,103

      Total noninterest expenses

83,352

85,415

102,755

52,288

323,810

Income before income taxes

66,801

63,516

45,745

38,159

214,221

Income tax expense (benefit)

11,787

12,859

9,327

7,653

41,626

      Net income

$

55,014

$

50,657

$

36,418

$

30,506

$

172,595

ADDITIONAL DATA

Net earnings per share - basic

$

0.56

$

0.52

$

0.37

$

0.49

$

1.95

Net earnings per share - diluted

$

0.56

$

0.51

$

0.37

$

0.49

$

1.93

Dividends declared per share

$

0.20

$

0.20

$

0.19

$

0.19

$

0.78

Return on average assets

1.59

%

1.45

%

1.05

%

1.40

%

1.37

%

Return on average shareholders' equity

10.68

%

9.94

%

7.36

%

13.31

%

9.85

%

Interest income

$

153,429

$

149,220

$

147,379

$

90,354

$

540,382

Tax equivalent adjustment

1,442

1,567

1,420

718

5,147

   Interest income - tax equivalent

154,871

150,787

148,799

91,072

545,529

Interest expense

27,470

25,735

23,400

14,542

91,147

   Net interest income - tax equivalent

$

127,401

$

125,052

$

125,399

$

76,530

$

454,382

Net interest margin

4.16

%

4.06

%

4.10

%

3.80

%

4.05

%

Net interest margin (fully tax equivalent) (1)

4.21

%

4.12

%

4.15

%

3.84

%

4.10

%

Full-time equivalent employees

2,073

2,028

2,118

1,289

(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)

Dec. 31,

Sep. 30,

Jun. 30,

Mar. 31,

Dec. 31,

% Change

% Change

2019

2019

2019

2019

2018

Linked Qtr.

Comp Qtr.

ASSETS

     Cash and due from banks

$

200,691

$

242,482

$

169,694

$

169,004

$

236,221

(17.2)

%

(15.0)

%

     Interest-bearing deposits with other banks

56,948

39,669

101,668

50,224

37,738

43.6

%

50.9

%

     Investment securities available-for-sale

2,852,084

2,850,502

3,152,970

3,113,811

2,779,255

0.1

%

2.6

%

     Investment securities held-to-maturity

142,862

148,778

154,327

158,305

429,328

(4.0)

%

(66.7)

%

     Other investments

125,020

124,965

127,439

115,731

115,660

0.0

%

8.1

%

     Loans held for sale

13,680

23,528

20,244

8,217

4,372

(41.9)

%

212.9

%

     Loans and leases

       Commercial and industrial

2,465,877

2,470,017

2,547,997

2,543,427

2,514,661

(0.2)

%

(1.9)

%

       Lease financing

88,364

92,616

90,638

95,573

93,415

(4.6)

%

(5.4)

%

       Construction real estate

493,182

515,960

497,683

458,113

548,935

(4.4)

%

(10.2)

%

       Commercial real estate

4,194,651

4,015,908

3,903,654

3,802,179

3,754,681

4.5

%

11.7

%

       Residential real estate

1,055,949

1,055,007

1,015,820

975,120

955,646

0.1

%

10.5

%

       Home equity

771,869

776,885

787,139

797,118

817,282

(0.6)

%

(5.6)

%

       Installment

82,589

88,275

89,149

90,689

93,212

(6.4)

%

(11.4)

%

       Credit card

49,184

49,010

48,706

46,982

46,382

0.4

%

6.0

%

          Total loans

9,201,665

9,063,678

8,980,786

8,809,201

8,824,214

1.5

%

4.3

%

       Less:

          Allowance for loan and lease losses

57,650

56,552

61,549

56,722

56,542

1.9

%

2.0

%

                Net loans

9,144,015

9,007,126

8,919,237

8,752,479

8,767,672

1.5

%

4.3

%

     Premises and equipment

214,506

213,681

211,313

210,676

215,652

0.4

%

(0.5)

%

     Goodwill

937,771

937,689

879,727

879,727

880,251

0.0

%

6.5

%

     Other intangibles

76,201

79,506

36,349

38,571

40,805

(4.2)

%

86.7

%

     Accrued interest and other assets

747,847

812,519

664,695

577,518

479,706

(8.0)

%

55.9

%

       Total Assets

$

14,511,625

$

14,480,445

$

14,437,663

$

14,074,263

$

13,986,660

0.2

%

3.8

%

LIABILITIES

     Deposits

       Interest-bearing demand

$

2,364,881

$

2,316,301

$

2,332,692

$

2,235,036

$

2,307,071

2.1

%

2.5

%

       Savings

2,960,979

2,924,200

2,953,114

3,100,894

3,167,325

1.3

%

(6.5)

%

       Time

2,240,441

2,308,617

2,321,908

2,309,810

2,173,564

(3.0)

%

3.1

%

          Total interest-bearing deposits

7,566,301

7,549,118

7,607,714

7,645,740

7,647,960

0.2

%

(1.1)

%

       Noninterest-bearing

2,643,928

2,534,739

2,501,290

2,488,157

2,492,434

4.3

%

6.1

%

          Total deposits

10,210,229

10,083,857

10,109,004

10,133,897

10,140,394

1.3

%

0.7

%

     Federal funds purchased and securities sold

         under agreements to repurchase

165,181

85,286

260,621

95,015

183,591

93.7

%

(10.0)

%

     FHLB short-term borrowings

1,151,000

1,128,900

1,052,700

952,400

857,100

2.0

%

34.3

%

          Total short-term borrowings

1,316,181

1,214,186

1,313,321

1,047,415

1,040,691

8.4

%

26.5

%

     Long-term debt

414,376

498,778

547,042

546,423

570,739

(16.9)

%

(27.4)

%

          Total borrowed funds

1,730,557

1,712,964

1,860,363

1,593,838

1,611,430

1.0

%

7.4

%

     Accrued interest and other liabilities

323,134

422,311

280,107

216,109

156,587

(23.5)

%

106.4

%

       Total Liabilities

12,263,920

12,219,132

12,249,474

11,943,844

11,908,411

0.4

%

3.0

%

SHAREHOLDERS' EQUITY

     Common stock

1,640,771

1,639,333

1,623,699

1,622,554

1,633,256

0.1

%

0.5

%

     Retained earnings

711,249

685,368

657,730

626,408

600,014

3.8

%

18.5

%

     Accumulated other comprehensive income (loss)

13,323

15,450

5,193

(19,635)

(44,408)

(13.8)

%

130.0

%

     Treasury stock, at cost

(117,638)

(78,838)

(98,433)

(98,908)

(110,613)

49.2

%

6.4

%

       Total Shareholders' Equity

2,247,705

2,261,313

2,188,189

2,130,419

2,078,249

(0.6)

%

8.2

%

       Total Liabilities and Shareholders' Equity

$

14,511,625

$

14,480,445

$

14,437,663

$

14,074,263

$

13,986,660

0.2

%

3.8

%

FIRST FINANCIAL BANCORP.

AVERAGE CONSOLIDATED STATEMENTS OF CONDITION

(Dollars in thousands)

(Unaudited)

Quarterly Averages

Year-to-Date Averages

Dec. 31,

Sep. 30,

Jun. 30,

Mar. 31,

Dec. 31,

December 31,

2019

2019

2019

2019

2018

2019

2018

ASSETS

     Cash and due from banks

$

221,060

$

191,000

$

173,278

$

181,695

$

213,927

$

191,864

$

188,971

     Federal funds sold

0

0

0

0

0

0

196

     Interest-bearing deposits with other banks

36,672

38,569

33,255

34,709

32,013

35,814

31,894

     Investment securities

3,102,867

3,290,666

3,408,994

3,355,732

3,204,758

3,288,875

2,897,167

     Loans held for sale

21,050

18,197

13,258

6,392

10,411

14,774

12,340

     Loans and leases

       Commercial and industrial

2,469,810

2,509,782

2,533,981

2,509,274

2,402,296

2,505,615

2,518,333

       Lease financing

91,225

94,858

94,458

91,043

94,111

92,902

91,476

       Construction real estate

501,892

509,742

457,962

496,153

567,086

491,503

540,014

       Commercial real estate

4,102,288

3,925,028

3,834,404

3,762,314

3,793,376

3,906,992

3,310,697

       Residential real estate

1,053,707

1,035,975

989,923

961,584

941,047

1,010,620

809,114

       Home equity

773,119

781,340

789,087

807,768

813,779

787,716

724,926

       Installment

85,515

88,760

89,778

91,270

95,779

88,815

95,847

       Credit card

50,616

50,410

49,811

47,512

48,417

49,598

47,951

          Total loans

9,128,172

8,995,895

8,839,404

8,766,918

8,755,891

8,933,761

8,138,358

       Less:

          Allowance for loan and lease losses

56,649

61,911

58,335

57,088

58,216

58,504

56,115

                Net loans

9,071,523

8,933,984

8,781,069

8,709,830

8,697,675

8,875,257

8,082,243

     Premises and equipment

215,171

215,671

211,714

213,208

218,430

213,951

199,727

     Goodwill

937,710

899,888

879,726

878,541

878,669

899,131

714,528

     Other intangibles

78,190

51,365

37,666

39,900

42,305

51,884

33,682

     Accrued interest and other assets

776,045

681,174

563,773

532,544

470,770

639,169

450,690

       Total Assets

$

14,460,288

$

14,320,514

$

14,102,733

$

13,952,551

$

13,768,958

$

14,210,719

$

12,611,438

LIABILITIES

     Deposits

       Interest-bearing demand

$

2,373,962

$

2,325,405

$

2,334,322

$

2,269,948

$

2,342,528

$

2,326,193

$

2,169,396

       Savings

2,995,395

2,945,076

3,057,100

3,115,557

3,156,789

3,027,725

2,990,731

       Time

2,214,174

2,234,227

2,220,724

2,224,587

2,073,752

2,223,429

1,938,709

          Total interest-bearing deposits

7,583,531

7,504,708

7,612,146

7,610,092

7,573,069

7,577,347

7,098,836

       Noninterest-bearing

2,638,908

2,513,458

2,484,214

2,457,587

2,476,773

2,524,011

2,217,349

          Total deposits

10,222,439

10,018,166

10,096,360

10,067,679

10,049,842

10,101,358

9,316,185

     Federal funds purchased and securities sold

          under agreements to repurchase

206,800

185,156

126,872

103,147

65,805

155,859

87,221

     FHLB short-term borrowings

952,625

1,112,091

982,993

913,974

873,533

990,860

860,206

          Total short-term borrowings

1,159,425

1,297,247

1,109,865

1,017,121

939,338

1,146,719

947,427

     Long-term debt

454,271

519,736

546,705

569,947

570,304

522,340

438,567

       Total borrowed funds

1,613,696

1,816,983

1,656,570

1,587,068

1,509,642

1,669,059

1,385,994

     Accrued interest and other liabilities

379,046

275,038

202,806

203,570

166,590

265,623

156,998

       Total Liabilities

12,215,181

12,110,187

11,955,736

11,858,317

11,726,074

12,036,040

10,859,177

SHAREHOLDERS' EQUITY

     Common stock

1,640,066

1,629,286

1,622,994

1,625,228

1,632,361

1,629,434

1,371,373

     Retained earnings

691,236

662,899

635,629

610,737

576,145

650,381

535,139

     Accumulated other comprehensive loss

13,986

11,985

(12,889)

(39,796)

(55,161)

(6,480)

(43,081)

     Treasury stock, at cost

(100,181)

(93,843)

(98,737)

(101,935)

(110,461)

(98,656)

(111,170)

       Total Shareholders' Equity

2,245,107

2,210,327

2,146,997

2,094,234

2,042,884

2,174,679

1,752,261

       Total Liabilities and Shareholders' Equity

$

14,460,288

$

14,320,514

$

14,102,733

$

13,952,551

$

13,768,958

$

14,210,719

$

12,611,438

FIRST FINANCIAL BANCORP.

NET INTEREST MARGIN RATE/VOLUME ANALYSIS

(Dollars in thousands)

(Unaudited)

 Quarterly Averages

Year-to-Date Averages

December 31, 2019

September 30, 2019

December 31, 2018

December 31, 2019

December 31, 2018

Balance

Yield

Balance

Yield

Balance

Yield

Balance

Yield

Balance

Yield

Earning assets

    Investments:

      Investment securities

$

3,102,867

3.16

%

$

3,290,666

3.21

%

$

3,204,758

3.30

%

$

3,288,875

3.28

%

$

2,897,167

3.19

%

      Interest-bearing deposits with other banks

36,672

1.81

%

38,569

2.28

%

32,013

2.38

%

35,814

2.25

%

32,090

2.15

%

    Gross loans (1)

9,149,222

5.33

%

9,014,092

5.58

%

8,766,302

5.73

%

8,948,535

5.58

%

8,151,068

5.49

%

       Total earning assets

12,288,761

4.77

%

12,343,327

4.94

%

12,003,073

5.07

%

12,273,224

4.95

%

11,080,325

4.88

%

Nonearning assets

    Allowance for loan and lease losses

(56,649)

(61,911)

(58,216)

(58,504)

(56,115)

    Cash and due from banks

221,060

191,000

213,927

191,864

188,971

    Accrued interest and other assets

2,007,116

1,848,098

1,610,174

1,804,135

1,398,257

       Total assets

$

14,460,288

$

14,320,514

$

13,768,958

$

14,210,719

$

12,611,438

Interest-bearing liabilities

    Deposits:

      Interest-bearing demand

$

2,373,962

0.53

%

$

2,325,405

0.56

%

$

2,342,528

0.48

%

$

2,326,193

0.55

%

$

2,169,396

0.39

%

      Savings

2,995,395

0.60

%

2,945,076

0.69

%

3,156,789

0.66

%

3,027,725

0.71

%

2,990,731

0.60

%

      Time

2,214,174

2.03

%

2,234,227

2.09

%

2,073,752

1.75

%

2,223,429

2.02

%

1,938,709

1.57

%

    Total interest-bearing deposits

7,583,531

1.00

%

7,504,708

1.07

%

7,573,069

0.90

%

7,577,347

1.04

%

7,098,836

0.80

%

    Borrowed funds

      Short-term borrowings

1,159,425

1.86

%

1,297,247

2.20

%

939,338

2.19

%

1,146,719

2.20

%

947,427

1.90

%

      Long-term debt

454,271

3.75

%

519,736

3.63

%

570,304

3.54

%

522,340

3.65

%

438,567

3.68

%

        Total borrowed funds

1,613,696

2.39

%

1,816,983

2.61

%

1,509,642

2.70

%

1,669,059

2.65

%

1,385,994

2.47

%

       Total interest-bearing liabilities

9,197,227

1.24

%

9,321,691

1.37

%

9,082,711

1.20

%

9,246,406

1.33

%

8,484,830

1.07

%

Noninterest-bearing liabilities

    Noninterest-bearing demand deposits

2,638,908

2,513,458

2,476,773

2,524,011

2,217,349

    Other liabilities

379,046

275,038

166,590

265,623

156,998

    Shareholders' equity

2,245,107

2,210,327

2,042,884

2,174,679

1,752,261

       Total liabilities & shareholders' equity

$

14,460,288

$

14,320,514

$

13,768,958

$

14,210,719

$

12,611,438

Net interest income

$

118,902

$

121,535

$

125,959

$

484,254

$

449,235

Net interest spread

3.53

%

3.57

%

3.87

%

3.62

%

3.81

%

Net interest margin

3.84

%

3.91

%

4.16

%

3.95

%

4.05

%

Tax equivalent adjustment

0.05

%

0.05

%

0.05

%

0.05

%

0.05

%

Net interest margin (fully tax equivalent)

3.89

%

3.96

%

4.21

%

4.00

%

4.10

%

(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

$

(461)

$

(1,494)

$

(1,955)

$

(1,165)

$

(810)

$

(1,975)

$

2,425

$

12,835

$

15,260

    Interest-bearing deposits with other banks

(46)

(9)

(55)

(46)

21

(25)

30

84

114

    Gross loans (2)

(5,798)

1,814

(3,984)

(8,918)

5,140

(3,778)

7,352

44,470

51,822

       Total earning assets

(6,305)

311

(5,994)

(10,129)

4,351

(5,778)

9,807

57,389

67,196

Interest-bearing liabilities

    Total interest-bearing deposits

$

(1,323)

$

198

$

(1,125)

$

1,802

$

26

$

1,828

$

17,079

$

4,991

$

22,070

    Borrowed funds

    Short-term borrowings

(1,124)

(645)

(1,769)

(787)

1,031

244

2,816

4,386

7,202

    Long-term debt

152

(619)

(467)

304

(1,097)

(793)

(151)

3,056

2,905

       Total borrowed funds

(972)

(1,264)

(2,236)

(483)

(66)

(549)

2,665

7,442

10,107

       Total interest-bearing liabilities

(2,295)

(1,066)

(3,361)

1,319

(40)

1,279

19,744

12,433

32,177

          Net interest income (1)

$

(4,010)

$

1,377

$

(2,633)

$

(11,448)

$

4,391

$

(7,057)

$

(9,937)

$

44,956

$

35,019

(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)

Dec. 31,

Sep. 30,

Jun. 30,

Mar. 31,

Dec. 31,

Full Year

Full Year

2019

2019

2019

2019

2018

2019

2018

ALLOWANCE FOR LOAN AND LEASE LOSS ACTIVITY

Balance at beginning of period

$

56,552

$

61,549

$

56,722

$

56,542

$

57,715

$

56,542

$

54,021

  Provision for loan and lease losses

4,629

5,228

6,658

14,083

5,310

30,598

14,586

  Gross charge-offs

    Commercial and industrial

2,919

9,556

1,873

12,328

6,060

26,676

11,533

    Lease financing

62

0

0

100

0

162

0

    Construction real estate

0

0

0

0

0

0

0

    Commercial real estate

1,854

535

86

1,214

1,679

3,689

4,835

    Residential real estate

167

278

150

82

80

677

422

    Home equity

807

627

689

468

747

2,591

1,725

    Installment

31

65

78

49

158

223

435

    Credit card

319

598

289

341

392

1,547

1,720

      Total gross charge-offs

6,159

11,659

3,165

14,582

9,116

35,565

20,670

  Recoveries

    Commercial and industrial

1,796

556

291

240

485

2,883

2,066

    Lease financing

0

0

0

0

0

0

1

    Construction real estate

0

0

5

63

0

68

146

    Commercial real estate

439

347

254

73

1,681

1,113

4,106

    Residential real estate

72

64

101

36

44

273

211

    Home equity

243

335

572

185

274

1,335

1,309

    Installment

49

93

61

48

94

251

575

    Credit card

29

39

50

34

55

152

191

      Total recoveries

2,628

1,434

1,334

679

2,633

6,075

8,605

  Total net charge-offs

3,531

10,225

1,831

13,903

6,483

29,490

12,065

Ending allowance for loan and lease losses

$

57,650

$

56,552

$

61,549

$

56,722

$

56,542

$

57,650

$

56,542

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

  Commercial and industrial

0.18

%

1.42

%

0.25

%

1.95

%

0.92

%

0.95

%

0.38

%

  Lease financing

0.27

%

0.00

%

0.00

%

0.45

%

0.00

%

0.17

%

0.00

%

  Construction real estate

0.00

%

0.00

%

0.00

%

(0.05)

%

0.00

%

(0.01)

%

(0.03)

%

  Commercial real estate

0.14

%

0.02

%

(0.02)

%

0.12

%

0.00

%

0.07

%

0.02

%

  Residential real estate

0.04

%

0.08

%

0.02

%

0.02

%

0.02

%

0.04

%

0.03

%

  Home equity

0.29

%

0.15

%

0.06

%

0.14

%

0.23

%

0.16

%

0.06

%

  Installment

(0.08)

%

(0.13)

%

0.08

%

0.00

%

0.27

%

(0.03)

%

(0.15)

%

  Credit card

2.27

%

4.40

%

1.92

%

2.62

%

2.76

%

2.81

%

3.19

%

     Total net charge-offs

0.15

%

0.45

%

0.08

%

0.64

%

0.29

%

0.33

%

0.15

%

COMPONENTS OF NONPERFORMING LOANS, NONPERFORMING ASSETS, AND UNDERPERFORMING ASSETS

  Nonaccrual loans (1)

    Commercial and industrial

$

24,346

$

28,358

$

18,502

$

19,263

$

30,925

$

24,346

$

30,925

    Lease financing

223

284

295

301

22

223

22

    Construction real estate

0

5

6

7

9

0

9

    Commercial real estate

7,295

14,889

15,981

21,082

20,500

7,295

20,500

    Residential real estate

10,892

11,655

11,627

13,052

13,495

10,892

13,495

    Home equity

5,242

5,427

4,745

5,581

5,580

5,242

5,580

    Installment

167

75

195

170

169

167

169

      Nonaccrual loans

48,165

60,693

51,351

59,456

70,700

48,165

70,700

  Accruing troubled debt restructurings (TDRs)

11,435

18,450

37,420

22,817

16,109

11,435

16,109

     Total nonperforming loans

59,600

79,143

88,771

82,273

86,809

59,600

86,809

  Other real estate owned (OREO)

2,033

1,613

1,421

1,665

1,401

2,033

1,401

     Total nonperforming assets

61,633

80,756

90,192

83,938

88,210

61,633

88,210

  Accruing loans past due 90 days or more

201

287

107

178

63

201

63

     Total underperforming assets

$

61,834

$

81,043

$

90,299

$

84,116

$

88,273

$

61,834

$

88,273

Total classified assets

$

89,250

$

132,500

$

147,753

$

142,014

$

131,668

$

89,250

$

131,668

CREDIT QUALITY RATIOS

Allowance for loan and lease losses to

     Nonaccrual loans

119.69

%

93.18

%

119.86

%

95.40

%

79.97

%

119.69

%

79.97

%

     Nonperforming loans

96.73

%

71.46

%

69.33

%

68.94

%

65.13

%

96.73

%

65.13

%

     Total ending loans

0.63

%

0.62

%

0.69

%

0.64

%

0.64

%

0.63

%

0.64

%

Nonperforming loans to total loans

0.65

%

0.87

%

0.99

%

0.93

%

0.98

%

0.65

%

0.98

%

Nonperforming assets to

     Ending loans, plus OREO

0.67

%

0.89

%

1.00

%

0.95

%

1.00

%

0.67

%

1.00

%

     Total assets

0.42

%

0.56

%

0.62

%

0.60

%

0.63

%

0.42

%

0.63

%

Nonperforming assets, excluding accruing TDRs to

     Ending loans, plus OREO

0.55

%

0.69

%

0.59

%

0.69

%

0.82

%

0.55

%

0.82

%

     Total assets

0.35

%

0.43

%

0.37

%

0.43

%

0.52

%

0.35

%

0.52

%

Classified assets to total assets

0.62

%

0.92

%

1.02

%

1.01

%

0.94

%

0.62

%

0.94

%

(1)  Nonaccrual loans include nonaccrual TDRs of $18.5 million, $21.5 million, $11.0 million, $13.1 million, and $22.4 million, as of December 31, 2019, September 30, 2019, June 30, 2019, March 31, 2019, and December 31, 2018, respectively.

FIRST FINANCIAL BANCORP.

CAPITAL ADEQUACY

(Dollars in thousands, except per share data)

(Unaudited)

Twelve months ended,

Dec. 31,

Sep. 30,

Jun. 30,

Mar. 31,

Dec. 31,

Dec. 31,

Dec. 31,

2019

2019

2019

2019

2018

2019

2018

PER COMMON SHARE

Market Price

  High

$

26.04

$

25.49

$

25.80

$

28.56

$

29.58

$

28.56

$

33.55

  Low

$

23.24

$

22.37

$

22.16

$

23.02

$

22.40

$

22.16

$

22.40

  Close

$

25.44

$

24.48

$

24.22

$

24.06

$

23.72

$

25.44

$

23.72

Average shares outstanding - basic

98,684,706

98,517,025

98,083,799

97,926,088

97,424,839

98,305,570

88,582,090

Average shares outstanding - diluted

99,232,167

99,077,723

98,648,384

98,436,311

98,468,237

98,851,471

89,614,205

Ending shares outstanding

98,490,998

100,094,819

98,647,690

98,613,872

97,894,286

98,490,998

97,894,286

Total shareholders' equity

$

2,247,705

$

2,261,313

$

2,188,189

$

2,130,419

$

2,078,249

$

2,247,705

$

2,078,249

REGULATORY CAPITAL

Preliminary

Preliminary

Common equity tier 1 capital

$

1,245,746

$

1,253,803

$

1,281,406

$

1,246,004

$

1,215,613

$

1,245,746

$

1,215,613

Common equity tier 1 capital ratio

11.30

%

11.52

%

12.00

%

12.03

%

11.87

%

11.30

%

11.87

%

Tier 1 capital

$

1,288,185

$

1,296,399

$

1,323,905

$

1,287,757

$

1,257,366

$

1,288,185

$

1,257,366

Tier 1 ratio

11.69

%

11.91

%

12.40

%

12.43

%

12.28

%

11.69

%

12.28

%

Total capital

$

1,475,813

$

1,482,708

$

1,515,382

$

1,474,723

$

1,444,146

$

1,475,813

$

1,444,146

Total capital ratio

13.39

%

13.62

%

14.20

%

14.24

%

14.10

%

13.39

%

14.10

%

Total capital in excess of minimum requirement

$

318,315

$

339,935

$

394,571

$

387,048

$

432,832

$

318,315

$

432,832

Total risk-weighted assets

$

11,023,795

$

10,883,554

$

10,674,393

$

10,358,805

$

10,241,159

$

11,023,795

$

10,241,159

Leverage ratio

9.58

%

9.75

%

10.02

%

9.84

%

9.71

%

9.58

%

9.71

%

OTHER CAPITAL RATIOS

Ending shareholders' equity to ending assets

15.49

%

15.62

%

15.16

%

15.14

%

14.86

%

15.49

%

14.86

%

Ending tangible shareholders' equity to ending tangible assets

9.07

%

9.17

%

9.34

%

9.15

%

8.79

%

9.07

%

8.79

%

Average shareholders' equity to average assets

15.53

%

15.43

%

15.22

%

15.01

%

14.84

%

15.30

%

13.89

%

Average tangible shareholders' equity to average tangible assets

9.07

%

9.35

%

9.26

%

8.95

%

8.66

%

9.16

%

8.40

%

REPURCHASE PROGRAM (1)

Shares repurchased

1,609,778

1,143,494

0

0

0

2,753,272

0

Average share repurchase price

$

24.13

$

23.94

N/A

N/A

N/A

$

24.05

N/A

Total cost of shares repurchased

$

38,846

$

27,372

N/A

N/A

N/A

$

66,218

N/A

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

N/A = Not applicable

View original content:http://www.prnewswire.com/news-releases/first-financial-bancorp-announces-fourth-quarter-and-full-year-2019-financial-results-300992435.html

SOURCE First Financial Bancorp.