First Financial Bancorp Announces Fourth Quarter and Full Year 2023 Financial Results and Quarterly Dividend

About this update from First Financial Bancorp.

Earnings per diluted share of $0.60 ; $0.62 on an adjusted (1) basis Return on average assets of 1.31%; 1.37% on an adjusted (1) basis Net interest margin on FTE basis (1) of 4.26%; 7 bp decrease from linked quarter Loan growth of $286.4 million ; 10.7% on an annualized basis Average deposit balances increased 12.9% on an annualized basis Credit trends stable to improving in the quarter Tangible Book Value increased $1.47 , or 13.5% from linked quarter Quarterly dividend of $0.23 approved by Board of Directors CINCINNATI , Jan. 25, 2024 /PRNewswire/ -- First Financial Bancorp . (Nasdaq: FFBC) ("First Financial" or the "Company") announced financial results for the three and twelve months ended December 31, 2023 . For the three months ended December 31, 2023 , the Company reported net income of $56.7 million , or $0.60 per diluted common share. These results compare to net income of $63.1 million , or $0.66 per diluted common share, for the third quarter of 2023. For the twelve months ended December 31, 2023 , First Financial had earnings per diluted share of $2.69 compared to $2.30 for the same period in 2022. Return on average assets for the fourth quarter of 2023 was 1.31% while return on average tangible common equity was 21.36%(1). These compare to return on average assets of 1.48% and return on average tangible common equity of 23.60%(1) in the third quarter of 2023. Fourth quarter 2023 highlights include: Net interest margin of 4.21%, or 4.26% on a fully tax-equivalent basis(1) 7 bp decrease to 4.26% from 4.33% in the third quarter due to increasing funding costs Higher asset yields and earning asset mix significantly offset 31 bp increase in cost of deposits Average deposit balances increased $415.7 million with growth in money market accounts, interest bearing checking accounts, retail CDs and brokered CD's offsetting declines in noninterest bearing checking and savings accounts Noninterest income of $47.0 million , or $47.6 million as adjusted(1) Bannockburn income of $8.7 million included $4.6 million loss on a trade; loss was offset by lower noninterest expenses Strong leasing business income of $12.9 million Higher other noninterest income driven by increase in syndication fees Adjusted(1) $0.6 million for losses on investment securities and other items not expected to recur Noninterest expenses of $119.1 million , or $116.8 million as adjusted(1) $2.9 million decrease from linked quarter driven primarily by lower employee costs and marketing expenses Fourth quarter adjustments(1) include $0.9 million FDIC special assessment and other costs not expected to recur such as acquisition, severance and branch consolidation costs Efficiency ratio of 59.3%; 58.0% 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. Accelerating loan growth during the quarter Loan balances increased $286.4 million compared to the third quarter Growth of 10.7% on an annualized basis CRE, specialty lending, residential mortgages and finance leases drove quarterly growth Robust deposit growth during the quarter Total deposits increased $445.2 million , or 3.4%, from linked quarter Average deposit balances increased $415.7 million with growth in money market accounts, interest bearing checking accounts, retail CDs and brokered CD's offsetting declines in noninterest bearing checking and savings accounts Total Allowance for Credit Losses of $159.9 million ; Total quarterly provision expense of $10.2 million Loans and leases - ACL of $141.4 million ; decreased 7 bps to 1.29% of total loans Unfunded Commitments - ACL of $18.4 million ; increased $1.4 million from linked quarter Provision expense driven by net charge-offs and loan growth; Classified assets were stable at $141.0 million Annualized net charge-offs were 46 bps of total loans and included $9.2 million related to a single relationship that was previously reserved for Capital ratios remain solid Total capital ratio increased 24 bps to 13.75% Tier 1 common equity increased 25 bps to 11.85% Tangible common equity increased 67 bps to 7.17%(1); 9.05%(1) excluding impact from AOCI Tangible book value per share of $12.38 (1); 13.5% increase from linked quarter Additionally, the board of directors approved a quarterly dividend of $0.23 per common share for the next regularly scheduled dividend, payable on March 15, 2024 to shareholders of record as of March 1, 2024 . Archie Brown , President and CEO, commented on the quarter, "I am pleased with our fourth quarter performance. Adjusted(1) earnings per share were $0.62 , which resulted in an adjusted(1) return on assets of 1.37% and an adjusted(1) return on tangible common equity ratio of 22.2%. As expected, rising funding costs outpaced our asset yields, however our net interest margin remained very strong at 4.26%. Additionally, balance sheet trends were positive during the quarter, with loans increasing $286 million , or 11% on an annualized basis, and average deposits increasing $416 million , or 13% on an annualized basis." Mr. Brown continued, "Noninterest income and expenses were both lower than we expected during the quarter. The decline in noninterest income included a $4.6 million loss on a trade at Bannockburn, however excluding this loss, foreign exchange income was within our range of expectations. Leasing income also declined during the period due to lower end of term fees and lease originations shifting to a greater mix of finance leases. While this shift increased interest income and the net interest margin, it resulted in lower noninterest income during the period. Noninterest expenses declined for the quarter primarily due to lower incentive compensation, which is tied directly to noninterest income." Mr. Brown commented on asset quality, "Asset quality was stable for the quarter with underlying credit trends improving. Net charge-offs were 46 basis points during the quarter and were driven by a relationship that included borrower fraud . This loan had been on non-accrual for most of the year and was almost fully reserved coming into the fourth quarter. Additionally, nonperforming assets declined by 12% to 0.38% of total assets and classified asset balances were relatively unchanged from the third quarter." Mr. Brown discussed full year results, "2023 was a record year for First Financial. Adjusted(1) earnings per share increased 17% from the prior year to $2.77 , while adjusted(1) return on assets was 1.55%, adjusted (1) return on tangible common equity was 25.4% and our adjusted(1) efficiency ratio was 56%. Total revenue of $840.2 million was the highest in the Company's history, increasing 18.5% over the prior year. Our balance sheet responded favorably to the interest rate environment, resulting in a 21% increase in net interest income. Additionally, record years from wealth management and Summit drove a 12% increase in noninterest income." Mr. Brown continued, "We are extremely pleased with the performance of our balance sheet during 2023, especially given the turmoil in the banking industry in the first half of the year. Loan production was solid, exceeding 6% in balance growth, while average deposit balances increased 2.4% compared to the prior year. We are also very happy with the 122 basis point expansion in the tangible common equity ratio and 24% increase in tangible book value per share for the year." Mr. Brown commented on full year asset quality, "Asset quality trends were elevated during the year. Net charge-offs increased to 33 basis points for 2023, after we achieved a record low of 6 basis points in 2022. This increase was driven by two large relationships, as well as the loss on the sale of a small portfolio of ICRE loans. Non-performing assets to total assets ended the year at 38 basis points. We believe we are well positioned to manage the coming year and we are cautiously optimistic regarding asset quality in 2024." Mr. Brown concluded, "Finally, I'd like to commend our associates for their exemplary performance in 2023. They were client focused and executed at a very high level despite the industry uncertainty earlier in the year. During the year we have strengthened our team with the addition of talent in Wealth Management and in expansion markets, including Chicago, IL , Evansville, IN and Cleveland , OH. I'm extremely proud of the work our team accomplished in 2023 and believe we are positioned to have sustained success in 2024 and beyond." Full detail of the Company's fourth quarter 2023 performance is provided in the accompanying financial statements and slide presentation. Teleconference / Webcast Information First Financial's executive management will host a conference call to discuss the Company's financial and operating results on Friday, January 26, 2024 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 February 9, 2024 . 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 Website This 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 Measures This 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 Statements Certain 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 December 31, 2023 , the Company had $17.5 billion in assets, $10.9 billion in loans, $13.4 billion in deposits and $2.3 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 $3.5 billion in assets under management as of December 31, 2023 . The Company operated 130 full service banking centers as of December 31, 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, Twelve months ended, Dec. 31 , Sep. 30 , June 30 , Mar. 31 , Dec. 31 , Dec. 31 , 2023 2023 2023 2023 2022 2023 2022 RESULTS OF OPERATIONS Net income $ 56,732 $ 63,061 $ 65,667 $ 70,403 $ 69,086 $ 255,863 $ 217,612 Net earnings per share - basic $ 0.60 $ 0.67 $ 0.70 $ 0.75 $ 0.74 $ 2.72 $ 2.33 Net earnings per share - diluted $ 0.60 $ 0.66 $ 0.69 $ 0.74 $ 0.73 $ 2.69 $ 2.30 Dividends declared per share $ 0.23 $ 0.23 $ 0.23 $ 0.23 $ 0.23 $ 0.92 $ 0.92 KEY FINANCIAL RATIOS Return on average assets 1.31 % 1.48 % 1.55 % 1.69 % 1.63 % 1.51 % 1.33 % Return on average shareholders' equity 10.50 % 11.62 % 12.32 % 13.71 % 13.64 % 12.01 % 10.34 % Return on average tangible shareholders' equity (1) 21.36 % 23.60 % 25.27 % 29.02 % 29.93 % 24.72 % 21.62 % Net interest margin 4.21 % 4.28 % 4.43 % 4.51 % 4.43 % 4.36 % 3.73 % Net interest margin (fully tax equivalent) (1)(2) 4.26 % 4.33 % 4.48 % 4.55 % 4.47 % 4.40 % 3.77 % Ending shareholders' equity as a percent of ending assets 12.94 % 12.49 % 12.54 % 12.53 % 12.01 % 12.94 % 12.01 % Ending tangible shareholders' equity as a percent of: Ending tangible assets (1) 7.17 % 6.50 % 6.56 % 6.47 % 5.95 % 7.17 % 5.95 % Risk-weighted assets (1) 8.90 % 7.88 % 8.03 % 7.87 % 7.32 % 8.90 % 7.32 % Average shareholders' equity as a percent of average assets 12.52 % 12.70 % 12.60 % 12.29 % 11.98 % 12.53 % 12.85 % Average tangible shareholders' equity as a percent of average tangible assets (1) 6.57 % 6.69 % 6.57 % 6.21 % 5.84 % 6.51 % 6.59 % Book value per share $ 23.84 $ 22.39 $ 22.52 $ 22.29 $ 21.51 $ 23.84 $ 21.51 Tangible book value per share (1) $ 12.38 $ 10.91 $ 11.02 $ 10.76 $ 9.97 $ 12.38 $ 9.97 Common equity tier 1 ratio (3) 11.85 % 11.60 % 11.34 % 11.00 % 10.83 % 11.85 % 10.83 % Tier 1 ratio (3) 12.19 % 11.94 % 11.68 % 11.34 % 11.17 % 12.19 % 11.17 % Total capital ratio (3) 13.75 % 13.51 % 13.44 % 13.11 % 13.09 % 13.75 % 13.09 % Leverage ratio (3) 9.70 % 9.59 % 9.33 % 9.03 % 8.89 % 9.70 % 8.89 % AVERAGE BALANCE SHEET ITEMS Loans (4) $ 10,751,028 $ 10,623,734 $ 10,513,505 $ 10,373,302 $ 10,059,119 $ 10,566,587 $ 9,574,965 Investment securities 3,184,408 3,394,237 3,560,453 3,635,317 3,705,304 3,442,233 4,032,046 Interest-bearing deposits with other banks 548,153 386,173 329,584 318,026 372,054 396,089 314,552 Total earning assets $ 14,483,589 $ 14,404,144 $ 14,403,542 $ 14,326,645 $ 14,136,477 $ 14,404,909 $ 13,921,563 Total assets $ 17,124,955 $ 16,951,389 $ 16,968,055 $ 16,942,999 $ 16,767,598 $ 16,997,223 $ 16,382,730 Noninterest-bearing deposits $ 3,368,024 $ 3,493,305 $ 3,663,419 $ 3,954,915 $ 4,225,192 $ 3,617,961 $ 4,196,735 Interest-bearing deposits 9,834,819 9,293,860 9,050,464 8,857,226 8,407,114 9,261,866 8,383,529 Total deposits $ 13,202,843 $ 12,787,165 $ 12,713,883 $ 12,812,141 $ 12,632,306 $ 12,879,827 $ 12,580,264 Borrowings $ 1,083,954 $ 1,403,071 $ 1,523,699 $ 1,434,338 $ 1,489,088 $ 1,360,420 $ 1,177,013 Shareholders' equity $ 2,144,482 $ 2,153,601 $ 2,137,765 $ 2,082,210 $ 2,009,564 $ 2,129,751 $ 2,105,339 CREDIT QUALITY RATIOS Allowance to ending loans 1.29 % 1.36 % 1.41 % 1.36 % 1.29 % 1.29 % 1.29 % Allowance to nonaccrual loans 215.10 % 193.75 % 276.70 % 409.46 % 464.58 % 215.10 % 464.58 % Allowance to nonperforming loans 215.10 % 193.75 % 276.70 % 409.46 % 335.94 % 215.10 % 335.94 % Nonperforming loans to total loans 0.60 % 0.70 % 0.51 % 0.33 % 0.38 % 0.60 % 0.38 % Nonaccrual loans to total loans 0.60 % 0.70 % 0.51 % 0.33 % 0.28 % 0.60 % 0.28 % Nonperforming assets to ending loans, plus OREO 0.60 % 0.71 % 0.51 % 0.33 % 0.39 % 0.60 % 0.39 % Nonperforming assets to total assets 0.38 % 0.44 % 0.32 % 0.21 % 0.23 % 0.38 % 0.23 % Classified assets to total assets 0.80 % 0.82 % 0.81 % 0.94 % 0.75 % 0.80 % 0.75 % Net charge-offs to average loans (annualized) 0.46 % 0.61 % 0.22 % 0.00 % (0.01) % 0.33 % 0.06 % (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) December 31, 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, Twelve months ended, Dec. 31 , Dec. 31 , 2023 2022 % Change 2023 2022 % Change Interest income Loans and leases, including fees $ 197,416 $ 152,299 29.6 % $ 743,770 $ 458,742 62.1 % Investment securities Taxable 30,294 30,248 0.2 % 125,520 102,314 22.7 % Tax-exempt 3,402 4,105 (17.1) % 13,901 18,466 (24.7) % Total investment securities interest 33,696 34,353 (1.9) % 139,421 120,780 15.4 % Other earning assets 7,325 3,262 124.6 % 19,813 5,484 261.3 % Total interest income 238,437 189,914 25.5 % 903,004 585,006 54.4 % Interest expense Deposits 69,193 16,168 328.0 % 202,010 28,140 617.9 % Short-term borrowings 10,277 11,091 (7.3) % 53,378 19,132 179.0 % Long-term borrowings 5,202 4,759 9.3 % 19,846 18,591 6.8 % Total interest expense 84,672 32,018 164.5 % 275,234 65,863 317.9 % Net interest income 153,765 157,896 (2.6) % 627,770 519,143 20.9 % Provision for credit losses-loans and leases 8,804 8,689 1.3 % 43,074 6,731 539.9 % Provision for credit losses-unfunded commitments 1,426 1,341 6.3 % 33 4,982 (99.3) % Net interest income after provision for credit losses 143,535 147,866 (2.9) % 584,663 507,430 15.2 % Noninterest income Service charges on deposit accounts 6,846 6,406 6.9 % 27,289 28,062 (2.8) % Wealth management fees 6,091 5,648 7.8 % 26,081 23,506 11.0 % Bankcard income 3,349 3,736 (10.4) % 14,039 14,380 (2.4) % Client derivative fees 711 1,822 (61.0) % 5,155 5,441 (5.3) % Foreign exchange income 8,730 19,592 (55.4) % 54,051 54,965 (1.7) % Leasing business income 12,856 11,124 15.6 % 51,322 31,574 62.5 % Net gains from sales of loans 2,957 2,206 34.0 % 13,217 15,048 (12.2) % Net gain (loss) on sale of investment securities (851) (393) 116.5 % (1,258) (569) 121.1 % Net gain (loss) on equity securities 202 1,315 (84.6) % 206 (639) (132.2) % Other 6,102 4,579 33.3 % 22,320 17,873 24.9 % Total noninterest income 46,993 56,035 (16.1) % 212,422 189,641 12.0 % Noninterest expenses Salaries and employee benefits 70,637 73,621 (4.1) % 292,731 269,368 8.7 % Net occupancy 5,890 5,434 8.4 % 22,990 22,208 3.5 % Furniture and equipment 3,523 3,234 8.9 % 13,543 13,224 2.4 % Data processing 8,488 8,567 (0.9) % 35,852 33,662 6.5 % Marketing 2,087 2,198 (5.1) % 9,647 8,744 10.3 % Communication 707 690 2.5 % 2,729 2,683 1.7 % Professional services 3,148 3,015 4.4 % 9,926 9,734 2.0 % State intangible tax 984 974 1.0 % 3,914 4,285 (8.7) % FDIC assessments 3,651 2,173 68.0 % 11,948 7,194 66.1 % Intangible amortization 2,601 2,573 1.1 % 10,402 11,185 (7.0) % Leasing business expense 8,955 6,061 47.7 % 32,500 20,363 59.6 % Other 8,466 15,902 (46.8) % 32,307 52,699 (38.7) % Total noninterest expenses 119,137 124,442 (4.3) % 478,489 455,349 5.1 % Income before income taxes 71,391 79,459 (10.2) % 318,596 241,722 31.8 % Income tax expense (benefit) 14,659 10,373 41.3 % 62,733 24,110 160.2 % Net income $ 56,732 $ 69,086 (17.9) % $ 255,863 $ 217,612 17.6 % ADDITIONAL DATA Net earnings per share - basic $ 0.60 $ 0.74 $ 2.72 $ 2.33 Net earnings per share - diluted $ 0.60 $ 0.73 $ 2.69 $ 2.30 Dividends declared per share $ 0.23 $ 0.23 $ 0.92 $ 0.92 Return on average assets 1.31 % 1.63 % 1.51 % 1.33 % Return on average shareholders' equity 10.50 % 13.64 % 12.01 % 10.34 % Interest income $ 238,437 $ 189,914 25.5 % $ 903,004 $ 585,006 54.4 % Tax equivalent adjustment 1,672 1,553 7.7 % 6,356 6,357 0.0 % Interest income - tax equivalent 240,109 191,467 25.4 % 909,360 591,363 53.8 % Interest expense 84,672 32,018 164.5 % 275,234 65,863 317.9 % Net interest income - tax equivalent $ 155,437 $ 159,449 (2.5) % $ 634,126 $ 525,500 20.7 % Net interest margin 4.21 % 4.43 % 4.36 % 3.73 % Net interest margin (fully tax equivalent) (1) 4.26 % 4.47 % 4.40 % 3.77 % Full-time equivalent employees 2,129 2,070 (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 Fourth Third Second First Year to % Change Quarter Quarter Quarter Quarter Date Linked Qtr. Interest income Loans and leases, including fees $ 197,416 $ 192,261 $ 184,387 $ 169,706 $ 743,770 2.7 % Investment securities Taxable 30,294 31,297 32,062 31,867 125,520 (3.2) % Tax-exempt 3,402 3,522 3,513 3,464 13,901 (3.4) % Total investment securities interest 33,696 34,819 35,575 35,331 139,421 (3.2) % Other earning assets 7,325 5,011 3,933 3,544 19,813 46.2 % Total interest income 238,437 232,091 223,895 208,581 903,004 2.7 % Interest expense Deposits 69,193 57,069 44,292 31,456 202,010 21.2 % Short-term borrowings 10,277 14,615 15,536 12,950 53,378 (29.7) % Long-term borrowings 5,202 4,952 4,835 4,857 19,846 5.0 % Total interest expense 84,672 76,636 64,663 49,263 275,234 10.5 % Net interest income 153,765 155,455 159,232 159,318 627,770 (1.1) % Provision for credit losses-loans and leases 8,804 12,907 12,719 8,644 43,074 (31.8) % Provision for credit losses-unfunded commitments 1,426 (1,234) (1,994) 1,835 33 (215.6) % Net interest income after provision for credit losses 143,535 143,782 148,507 148,839 584,663 (0.2) % Noninterest income Service charges on deposit accounts 6,846 6,957 6,972 6,514 27,289 (1.6) % Wealth management fees 6,091 6,943 6,713 6,334 26,081 (12.3) % Bankcard income 3,349 3,406 3,692 3,592 14,039 (1.7) % Client derivative fees 711 1,612 1,827 1,005 5,155 (55.9) % Foreign exchange income 8,730 13,384 15,039 16,898 54,051 (34.8) % Leasing business income 12,856 14,537 10,265 13,664 51,322 (11.6) % Net gains from sales of loans 2,957 4,086 3,839 2,335 13,217 (27.6) % Net gain (loss) on sale of investment securities (851) (4) (384) (19) (1,258) N/M Net gain (loss) on equity securities 202 (54) (82) 140 206 474.1 % Other 6,102 5,761 5,377 5,080 22,320 5.9 % Total noninterest income 46,993 56,628 53,258 55,543 212,422 (17.0) % Noninterest expenses Salaries and employee benefits 70,637 75,641 74,199 72,254 292,731 (6.6) % Net occupancy 5,890 5,809 5,606 5,685 22,990 1.4 % Furniture and equipment 3,523 3,341 3,362 3,317 13,543 5.4 % Data processing 8,488 8,473 9,871 9,020 35,852 0.2 % Marketing 2,087 2,598 2,802 2,160 9,647 (19.7) % Communication 707 744 644 634 2,729 (5.0) % Professional services 3,148 2,524 2,308 1,946 9,926 24.7 % State intangible tax 984 981 964 985 3,914 0.3 % FDIC assessments 3,651 2,665 2,806 2,826 11,948 37.0 % Intangible amortization 2,601 2,600 2,601 2,600 10,402 0.0 % Leasing business expense 8,955 8,877 6,730 7,938 32,500 0.9 % Other 8,466 7,791 8,722 7,328 32,307 8.7 % Total noninterest expenses 119,137 122,044 120,615 116,693 478,489 (2.4) % Income before income taxes 71,391 78,366 81,150 87,689 318,596 (8.9) % Income tax expense (benefit) 14,659 15,305 15,483 17,286 62,733 (4.2) % Net income $ 56,732 $ 63,061 $ 65,667 $ 70,403 $ 255,863 (10.0) % ADDITIONAL DATA Net earnings per share - basic $ 0.60 $ 0.67 $ 0.70 $ 0.75 $ 2.72 Net earnings per share - diluted $ 0.60 $ 0.66 $ 0.69 $ 0.74 $ 2.69 Dividends declared per share $ 0.23 $ 0.23 $ 0.23 $ 0.23 $ 0.92 Return on average assets 1.31 % 1.48 % 1.55 % 1.69 % 1.51 % Return on average shareholders' equity 10.50 % 11.62 % 12.32 % 13.71 % 12.01 % Interest income $ 238,437 $ 232,091 $ 223,895 $ 208,581 $ 903,004 2.7 % Tax equivalent adjustment 1,672 1,659 1,601 1,424 6,356 0.8 % Interest income - tax equivalent 240,109 233,750 225,496 210,005 909,360 2.7 % Interest expense 84,672 76,636 64,663 49,263 275,234 10.5 % Net interest income - tax equivalent $ 155,437 $ 157,114 $ 160,833 $ 160,742 $ 634,126 (1.1) % Net interest margin 4.21 % 4.28 % 4.43 % 4.51 % 4.36 % Net interest margin (fully tax equivalent) (1) 4.26 % 4.33 % 4.48 % 4.55 % 4.40 % Full-time equivalent employees 2,129 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) Dec. 31 , Sep. 30 , June 30 , Mar. 31 , Dec. 31 , % Change % Change 2023 2023 2023 2023 2022 Linked Qtr. Comp Qtr. ASSETS Cash and due from banks $ 213,059 $ 220,335 $ 217,385 $ 199,835 $ 207,501 (3.3) % 2.7 % Interest-bearing deposits with other banks 792,960 452,867 485,241 305,465 388,182 75.1 % 104.3 % Investment securities available-for-sale 3,021,126 3,044,361 3,249,404 3,384,949 3,409,648 (0.8) % (11.4) % Investment securities held-to-maturity 80,321 81,236 82,372 83,070 84,021 (1.1) % (4.4) % Other investments 129,945 133,725 141,892 143,606 143,160 (2.8) % (9.2) % Loans held for sale 9,213 12,391 15,267 9,280 7,918 (25.6) % 16.4 % Loans and leases Commercial and industrial 3,501,221 3,420,873 3,433,162 3,449,289 3,410,272 2.3 % 2.7 % Lease financing 474,817 399,973 360,801 273,898 236,124 18.7 % 101.1 % Construction real estate 564,832 578,824 536,464 525,906 512,050 (2.4) % 10.3 % Commercial real estate 4,080,939 3,992,654 4,048,460 4,056,627 4,052,759 2.2 % 0.7 % Residential real estate 1,333,674 1,293,470 1,221,484 1,145,069 1,092,265 3.1 % 22.1 % Home equity 758,676 743,991 728,711 724,672 733,791 2.0 % 3.4 % Installment 159,078 160,648 165,216 204,372 209,895 (1.0) % (24.2) % Credit card 59,939 56,386 55,911 53,552 51,815 6.3 % 15.7 % Total loans 10,933,176 10,646,819 10,550,209 10,433,385 10,298,971 2.7 % 6.2 % Less: Allowance for credit losses (141,433) (145,201) (148,646) (141,591) (132,977) (2.6) % 6.4 % Net loans 10,791,743 10,501,618 10,401,563 10,291,794 10,165,994 2.8 % 6.2 % Premises and equipment 194,740 192,572 192,077 188,959 189,080 1.1 % 3.0 % Operating leases 153,214 136,883 132,272 153,986 91,738 11.9 % 67.0 % Goodwill 1,005,868 1,005,868 1,005,828 1,005,738 1,001,507 0.0 % 0.4 % Other intangibles 83,949 86,378 88,662 91,169 93,919 (2.8) % (10.6) % Accrued interest and other assets 1,056,762 1,186,618 1,078,186 1,076,033 1,220,648 (10.9) % (13.4) % Total Assets $ 17,532,900 $ 17,054,852 $ 17,090,149 $ 16,933,884 $ 17,003,316 2.8 % 3.1 % LIABILITIES Deposits Interest-bearing demand $ 2,993,219 $ 2,880,617 $ 2,919,472 $ 2,761,811 $ 3,037,153 3.9 % (1.4) % Savings 4,331,228 4,023,455 3,785,445 3,746,403 3,828,139 7.6 % 13.1 % Time 2,718,390 2,572,909 2,484,780 2,336,368 1,700,705 5.7 % 59.8 % Total interest-bearing deposits 10,042,837 9,476,981 9,189,697 8,844,582 8,565,997 6.0 % 17.2 % Noninterest-bearing 3,317,960 3,438,572 3,605,181 3,830,102 4,135,180 (3.5) % (19.8) % Total deposits 13,360,797 12,915,553 12,794,878 12,674,684 12,701,177 3.4 % 5.2 % FHLB short-term borrowings 800,000 755,000 1,050,300 1,089,400 1,130,000 6.0 % (29.2) % Other 137,814 219,188 165,983 128,160 157,156 (37.1) % (12.3) % Total short-term borrowings 937,814 974,188 1,216,283 1,217,560 1,287,156 (3.7) % (27.1) % Long-term debt 344,115 340,902 339,963 342,647 346,672 0.9 % (0.7) % Total borrowed funds 1,281,929 1,315,090 1,556,246 1,560,207 1,633,828 (2.5) % (21.5) % Accrued interest and other liabilities 622,200 694,700 595,606 577,497 626,938 (10.4) % (0.8) % Total Liabilities 15,264,926 14,925,343 14,946,730 14,812,388 14,961,943 2.3 % 2.0 % SHAREHOLDERS' EQUITY Common stock 1,638,972 1,636,054 1,632,659 1,629,428 1,634,605 0.2 % 0.3 % Retained earnings 1,136,718 1,101,905 1,060,715 1,016,893 968,237 3.2 % 17.4 % Accumulated other comprehensive income (loss) (309,819) (410,005) (353,010) (328,059) (358,663) (24.4) % (13.6) % Treasury stock, at cost (197,897) (198,445) (196,945) (196,766) (202,806) (0.3) % (2.4) % Total Shareholders' Equity 2,267,974 2,129,509 2,143,419 2,121,496 2,041,373 6.5 % 11.1 % Total Liabilities and Shareholders' Equity $ 17,532,900 $ 17,054,852 $ 17,090,149 $ 16,933,884 $ 17,003,316 2.8 % 3.1 % FIRST FINANCIAL BANCORP . AVERAGE CONSOLIDATED STATEMENTS OF CONDITION (Dollars in thousands) (Unaudited) Quarterly Averages Year-to-Date Averages Dec. 31 , Sep. 30 , June 30 , Mar. 31 , Dec. 31 , Dec. 31 , 2023 2023 2023 2023 2022 2023 2022 ASSETS Cash and due from banks $ 214,678 $ 211,670 $ 221,527 $ 218,724 $ 218,216 $ 216,625 $ 233,925 Interest-bearing deposits with other banks 548,153 386,173 329,584 318,026 372,054 396,089 314,552 Investment securities 3,184,408 3,394,237 3,560,453 3,635,317 3,705,304 3,442,233 4,032,046 Loans held for sale 12,547 15,420 11,856 5,531 8,639 11,369 12,968 Loans and leases Commercial and industrial 3,422,381 3,443,615 3,469,683 3,456,681 3,249,252 3,447,984 2,979,273 Lease financing 419,179 371,598 323,819 252,219 203,790 342,243 153,380 Construction real estate 540,314 547,884 518,190 536,294 501,787 535,715 476,597 Commercial real estate 4,060,733 4,024,798 4,050,946 4,017,021 4,028,944 4,038,457 4,040,365 Residential real estate 1,320,670 1,260,249 1,181,053 1,115,889 1,066,859 1,220,138 976,775 Home equity 750,925 735,251 726,333 728,185 735,039 735,236 721,048 Installment 160,242 164,092 172,147 205,934 208,484 175,447 159,807 Credit card 64,037 60,827 59,478 55,548 56,325 59,998 54,752 Total loans 10,738,481 10,608,314 10,501,649 10,367,771 10,050,480 10,555,218 9,561,997 Less: Allowance for credit losses (149,398) (150,297) (145,578) (136,419) (127,541) (145,472) (125,001) Net loans 10,589,083 10,458,017 10,356,071 10,231,352 9,922,939 10,409,746 9,436,996 Premises and equipment 194,435 194,228 190,583 190,346 189,342 192,414 191,191 Operating leases 139,331 132,984 138,725 107,092 88,365 129,631 76,967 Goodwill 1,005,870 1,005,844 1,005,791 1,005,713 998,575 1,005,805 999,611 Other intangibles 85,101 87,427 89,878 92,587 95,256 88,724 99,081 Accrued interest and other assets 1,151,349 1,065,389 1,063,587 1,138,311 1,168,908 1,104,587 985,393 Total Assets $ 17,124,955 $ 16,951,389 $ 16,968,055 $ 16,942,999 $ 16,767,598 $ 16,997,223 $ 16,382,730 LIABILITIES Deposits Interest-bearing demand $ 2,988,086 $ 2,927,416 $ 2,906,855 $ 2,906,712 $ 3,103,091 $ 2,932,477 $ 3,158,560 Savings 4,235,658 3,919,590 3,749,902 3,818,807 3,943,342 3,932,100 4,049,883 Time 2,611,075 2,446,854 2,393,707 2,131,707 1,360,681 2,397,289 1,175,086 Total interest-bearing deposits 9,834,819 9,293,860 9,050,464 8,857,226 8,407,114 9,261,866 8,383,529 Noninterest-bearing 3,368,024 3,493,305 3,663,419 3,954,915 4,225,192 3,617,961 4,196,735 Total deposits 13,202,843 12,787,165 12,713,883 12,812,141 12,632,306 12,879,827 12,580,264 Federal funds purchased and securities sold under agreements to repurchase 3,586 10,788 21,881 26,380 16,167 15,583 29,526 FHLB short-term borrowings 554,826 878,199 1,028,207 925,144 944,320 845,666 672,928 Other 185,221 175,682 132,088 139,195 184,439 158,221 115,041 Total short-term borrowings 743,633 1,064,669 1,182,176 1,090,719 1,144,926 1,019,470 817,495 Long-term debt 340,321 338,402 341,523 343,619 344,162 340,950 359,518 Total borrowed funds 1,083,954 1,403,071 1,523,699 1,434,338 1,489,088 1,360,420 1,177,013 Accrued interest and other liabilities 693,676 607,552 592,708 614,310 636,640 627,225 520,114 Total Liabilities 14,980,473 14,797,788 14,830,290 14,860,789 14,758,034 14,867,472 14,277,391 SHAREHOLDERS' EQUITY Common stock 1,637,197 1,634,102 1,631,230 1,633,396 1,632,941 1,633,992 1,634,558 Retained earnings 1,111,786 1,076,515 1,034,092 989,777 941,987 1,053,441 887,826 Accumulated other comprehensive loss (406,265) (358,769) (330,263) (339,450) (361,284) (358,870) (207,778) Treasury stock, at cost (198,236) (198,247) (197,294) (201,513) (204,080) (198,812) (209,267) Total Shareholders' Equity 2,144,482 2,153,601 2,137,765 2,082,210 2,009,564 2,129,751 2,105,339 Total Liabilities and Shareholders' Equity $ 17,124,955 $ 16,951,389 $ 16,968,055 $ 16,942,999 $ 16,767,598 $ 16,997,223 $ 16,382,730 FIRST FINANCIAL BANCORP . NET INTEREST MARGIN RATE/VOLUME ANALYSIS (Dollars in thousands) (Unaudited) Quarterly Averages Year-to-Date Averages December 31, 2023 September 30, 2023 December 31, 2022 December 31, 2023 December 31, 2022 Balance Interest Yield Balance Interest Yield Balance Interest Yield Balance Yield Balance Yield Earning assets Investments: Investment securities $ 3,184,408 $ 33,696 4.20 % $ 3,394,237 $ 34,819 4.07 % $ 3,705,304 $ 34,353 3.68 % $ 3,442,233 4.05 % $ 4,032,046 3.00 % Interest-bearing deposits with other banks 548,153 7,325 5.30 % 386,173 5,011 5.15 % 372,054 3,262 3.48 % 396,089 5.00 % 314,552 1.74 % Gross loans (1) 10,751,028 197,416 7.29 % 10,623,734 192,261 7.18 % 10,059,119 152,299 6.01 % 10,566,587 7.04 % 9,574,965 4.79 % Total earning assets 14,483,589 238,437 6.53 % 14,404,144 232,091 6.39 % 14,136,477 189,914 5.33 % 14,404,909 6.27 % 13,921,563 4.20 % Nonearning assets Allowance for credit losses (149,398) (150,297) (127,541) (145,472) (125,001) Cash and due from banks 214,678 211,670 218,216 216,625 233,925 Accrued interest and other assets 2,576,086 2,485,872 2,540,446 2,521,161 2,352,243 Total assets $ 17,124,955 $ 16,951,389 $ 16,767,598 $ 16,997,223 $ 16,382,730 Interest-bearing liabilities Deposits: Interest-bearing demand $ 2,988,086 $ 14,480 1.92 % $ 2,927,416 $ 12,953 1.76 % $ 3,103,091 $ 5,195 0.66 % $ 2,932,477 1.45 % $ 3,158,560 0.28 % Savings 4,235,658 26,632 2.49 % 3,919,590 19,853 2.01 % 3,943,342 4,819 0.48 % 3,932,100 1.73 % 4,049,883 0.22 % Time 2,611,075 28,081 4.27 % 2,446,854 24,263 3.93 % 1,360,681 6,154 1.79 % 2,397,289 3.81 % 1,175,086 0.88 % Total interest-bearing deposits 9,834,819 69,193 2.79 % 9,293,860 57,069 2.44 % 8,407,114 16,168 0.76 % 9,261,866 2.18 % 8,383,529 0.34 % Borrowed funds Short-term borrowings 743,633 10,277 5.48 % 1,064,669 14,615 5.45 % 1,144,926 11,091 3.84 % 1,019,470 5.24 % 817,495 2.34 % Long-term debt 340,321 5,202 6.06 % 338,402 4,952 5.81 % 344,162 4,759 5.49 % 340,950 5.82 % 359,518 5.17 % Total borrowed funds 1,083,954 15,479 5.67 % 1,403,071 19,567 5.53 % 1,489,088 15,850 4.22 % 1,360,420 5.38 % 1,177,013 3.20 % Total interest-bearing liabilities 10,918,773 84,672 3.08 % 10,696,931 76,636 2.84 % 9,896,202 32,018 1.28 % 10,622,286 2.59 % 9,560,542 0.69 % Noninterest-bearing liabilities Noninterest-bearing demand deposits 3,368,024 3,493,305 4,225,192 3,617,961 4,196,735 Other liabilities 693,676 607,552 636,640 627,225 520,114 Shareholders' equity 2,144,482 2,153,601 2,009,564 2,129,751 2,105,339 Total liabilities & shareholders' equity $ 17,124,955 $ 16,951,389 $ 16,767,598 $ 16,997,223 $ 16,382,730 Net interest income $ 153,765 $ 155,455 $ 157,896 $ 627,770 $ 519,143 Net interest spread 3.45 % 3.55 % 4.05 % 3.68 % 3.51 % Net interest margin 4.21 % 4.28 % 4.43 % 4.36 % 3.73 % Tax equivalent adjustment 0.05 % 0.05 % 0.04 % 0.04 % 0.04 % Net interest margin (fully tax equivalent) 4.26 % 4.33 % 4.47 % 4.40 % 3.77 % (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 $ 1,097 $ (2,220) $ (1,123) $ 4,855 $ (5,512) $ (657) $ 42,530 $ (23,889) $ 18,641 Interest-bearing deposits with other banks 149 2,165 2,314 1,710 2,353 4,063 10,250 4,079 14,329 Gross loans (2) 2,818 2,337 5,155 32,412 12,705 45,117 215,229 69,799 285,028 Total earning assets 4,064 2,282 6,346 38,977 9,546 48,523 268,009 49,989 317,998 Interest-bearing liabilities Total interest-bearing deposits $ 8,318 $ 3,806 $ 12,124 $ 42,980 $ 10,045 $ 53,025 $ 154,713 $ 19,157 $ 173,870 Borrowed funds Short-term borrowings 99 (4,437) (4,338) 4,732 (5,546) (814) 23,671 10,575 34,246 Long-term debt 221 29 250 502 (59) 443 2,336 (1,081) 1,255 Total borrowed funds 320 (4,408) (4,088) 5,234 (5,605) (371) 26,007 9,494 35,501 Total interest-bearing liabilities 8,638 (602) 8,036 48,214 4,440 52,654 180,720 28,651 209,371 Net interest income (1) $ (4,574) $ 2,884 $ (1,690) $ (9,237) $ 5,106 $ (4,131) $ 87,289 $ 21,338 $ 108,627 (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 , June 30 , Mar. 31 , Dec. 31 , Full Year Full Year 2023 2023 2023 2023 2022 2023 2022 ALLOWANCE FOR CREDIT LOSS ACTIVITY Balance at beginning of period $ 145,201 $ 148,646 $ 141,591 $ 132,977 $ 124,096 $ 132,977 $ 131,992 Provision for credit losses 8,804 12,907 12,719 8,644 8,689 43,074 6,731 Gross charge-offs Commercial and industrial 6,866 9,207 2,372 730 334 19,175 5,899 Lease financing 4,244 76 90 13 0 4,423 152 Construction real estate 0 0 0 0 0 0 0 Commercial real estate 1 6,008 2,648 66 245 8,723 3,667 Residential real estate 9 10 20 0 79 39 224 Home equity 174 54 21 91 72 340 160 Installment 2,054 1,349 1,515 1,524 717 6,442 1,549 Credit card 363 319 274 217 212 1,173 907 Total gross charge-offs 13,711 17,023 6,940 2,641 1,659 40,315 12,558 Recoveries Commercial and industrial 459 335 631 109 293 1,534 939 Lease financing 52 1 1 1 0 55 49 Construction real estate 0 0 0 0 0 0 0 Commercial real estate 93 39 153 2,238 1,327 2,523 4,304 Residential real estate 24 44 113 66 15 247 174 Home equity 178 125 232 80 88 615 898 Installment 210 87 90 54 68 441 165 Credit card 123 40 56 63 60 282 283 Total recoveries 1,139 671 1,276 2,611 1,851 5,697 6,812 Total net charge-offs 12,572 16,352 5,664 30 (192) 34,618 5,746 Ending allowance for credit losses $ 141,433 $ 145,201 $ 148,646 $ 141,591 $ 132,977 $ 141,433 $ 132,977 NET CHARGE-OFFS TO AVERAGE LOANS AND LEASES (ANNUALIZED) Commercial and industrial 0.74 % 1.02 % 0.20 % 0.07 % 0.01 % 0.51 % 0.17 % Lease financing 3.97 % 0.08 % 0.11 % 0.02 % 0.00 % 1.28 % 0.07 % Construction real estate 0.00 % 0.00 % 0.00 % 0.00 % 0.00 % 0.00 % 0.00 % Commercial real estate (0.01) % 0.59 % 0.25 % (0.22) % (0.11) % 0.15 % (0.02) % Residential real estate 0.00 % (0.01) % (0.03) % (0.02) % 0.02 % (0.02) % 0.01 % Home equity 0.00 % (0.04) % (0.12) % 0.01 % (0.01) % (0.04) % (0.10) % Installment 4.57 % 3.05 % 3.32 % 2.89 % 1.24 % 3.42 % 0.87 % Credit card 1.49 % 1.82 % 1.47 % 1.12 % 1.07 % 1.49 % 1.14 % Total net charge-offs 0.46 % 0.61 % 0.22 % 0.00 % (0.01) % 0.33 % 0.06 % COMPONENTS OF NONPERFORMING LOANS, NONPERFORMING ASSETS, AND UNDERPERFORMING ASSETS Nonaccrual loans (1) Commercial and industrial $ 15,746 $ 17,152 $ 21,508 $ 13,971 $ 8,242 $ 15,746 $ 8,242 Lease financing 3,610 7,731 4,833 175 178 3,610 178 Construction real estate 0 0 0 0 0 0 0 Commercial real estate 27,984 33,019 11,876 5,362 5,786 27,984 5,786 Residential real estate 14,067 12,328 11,697 11,129 10,691 14,067 10,691 Home equity 3,476 3,937 3,239 3,399 3,123 3,476 3,123 Installment 870 774 568 544 603 870 603 Nonaccrual loans 65,753 74,941 53,721 34,580 28,623 65,753 28,623 Accruing troubled debt restructurings (TDRs) (2) N/A N/A N/A N/A 10,960 N/A 10,960 Total nonperforming loans (2) 65,753 74,941 53,721 34,580 39,583 65,753 39,583 Other real estate owned (OREO) 106 142 281 191 191 106 191 Total nonperforming assets (2) 65,859 75,083 54,002 34,771 39,774 65,859 39,774 Accruing loans past due 90 days or more 2,028 698 873 159 857 2,028 857 Total underperforming assets (2) $ 67,887 $ 75,781 $ 54,875 $ 34,930 $ 40,631 $ 67,887 $ 40,631 Total classified assets (2) $ 140,995 $ 140,552 $ 138,909 $ 158,984 $ 128,137 $ 140,995 $ 128,137 CREDIT QUALITY RATIOS Allowance for credit losses to Nonaccrual loans 215.10 % 193.75 % 276.70 % 409.46 % 464.58 % 215.10 % 464.58 % Nonperforming loans 215.10 % 193.75 % 276.70 % 409.46 % 335.94 % 215.10 % 335.94 % Total ending loans 1.29 % 1.36 % 1.41 % 1.36 % 1.29 % 1.29 % 1.29 % Nonperforming loans to total loans 0.60 % 0.70 % 0.51 % 0.33 % 0.38 % 0.60 % 0.38 % Nonaccrual loans to total loans 0.60 % 0.70 % 0.51 % 0.33 % 0.28 % 0.60 % 0.28 % Nonperforming assets to Ending loans, plus OREO 0.60 % 0.71 % 0.51 % 0.33 % 0.39 % 0.60 % 0.39 % Total assets 0.38 % 0.44 % 0.32 % 0.21 % 0.23 % 0.38 % 0.23 % Nonperforming assets, excluding accruing TDRs to Ending loans, plus OREO 0.60 % 0.71 % 0.51 % 0.33 % 0.28 % 0.60 % 0.28 % Total assets 0.38 % 0.44 % 0.32 % 0.21 % 0.17 % 0.38 % 0.17 % Classified assets to total assets 0.80 % 0.82 % 0.81 % 0.94 % 0.75 % 0.80 % 0.75 % (1) Nonaccrual loans include nonaccrual TDRs of $10.0 million as of December 31, 2022 . (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) Three Months Ended, Twelve months ended, Dec. 31 , Sep. 30 , June 30 , Mar. 31 , Dec. 31 , Dec. 31 , Dec. 31 , 2023 2023 2023 2023 2022 2023 2022 PER COMMON SHARE Market Price High $ 24.28 $ 24.02 $ 22.27 $ 26.24 $ 26.68 $ 26.24 $ 26.73 Low $ 17.37 $ 19.19 $ 18.20 $ 21.30 $ 21.56 $ 17.37 $ 19.02 Close $ 23.75 $ 19.60 $ 20.44 $ 21.77 $ 24.23 $ 23.75 $ 24.23 Average shares outstanding - basic 94,063,570 94,030,275 93,924,068 93,732,532 93,590,674 93,938,772 93,528,712 Average shares outstanding - diluted 95,126,316 95,126,269 95,169,348 94,960,158 94,831,788 95,096,067 94,586,851 Ending shares outstanding 95,141,244 95,117,180 95,185,483 95,190,406 94,891,099 95,141,244 94,891,099 Total shareholders' equity $ 2,267,974 $ 2,129,509 $ 2,143,419 $ 2,121,496 $ 2,041,373 $ 2,267,974 $ 2,041,373 REGULATORY CAPITAL Preliminary Preliminary Common equity tier 1 capital $ 1,568,815 $ 1,527,793 $ 1,481,913 $ 1,432,332 $ 1,399,420 $ 1,568,815 $ 1,399,420 Common equity tier 1 capital ratio 11.85 % 11.60 % 11.34 % 11.00 % 10.83 % 11.85 % 10.83 % Tier 1 capital $ 1,613,480 $ 1,572,248 $ 1,526,362 $ 1,476,734 $ 1,443,698 $ 1,613,480 $ 1,443,698 Tier 1 ratio 12.19 % 11.94 % 11.68 % 11.34 % 11.17 % 12.19 % 11.17 % Total capital $ 1,820,285 $ 1,778,993 $ 1,756,968 $ 1,707,270 $ 1,691,255 $ 1,820,285 $ 1,691,255 Total capital ratio 13.75 % 13.51 % 13.44 % 13.11 % 13.09 % 13.75 % 13.09 % Total capital in excess of minimum requirement $ 430,482 $ 396,083 $ 384,735 $ 339,585 $ 334,316 $ 430,482 $ 334,316 Total risk-weighted assets $ 13,236,221 $ 13,170,574 $ 13,068,888 $ 13,025,567 $ 12,923,233 $ 13,236,221 $ 12,923,233 Leverage ratio 9.70 % 9.59 % 9.33 % 9.03 % 8.89 % 9.70 % 8.89 % OTHER CAPITAL RATIOS Ending shareholders' equity to ending assets 12.94 % 12.49 % 12.54 % 12.53 % 12.01 % 12.94 % 12.01 % Ending tangible shareholders' equity to ending tangible assets (1) 7.17 % 6.50 % 6.56 % 6.47 % 5.95 % 7.17 % 5.95 % Average shareholders' equity to average assets 12.52 % 12.70 % 12.60 % 12.29 % 11.98 % 12.53 % 12.85 % Average tangible shareholders' equity to average tangible assets (1) 6.57 % 6.69 % 6.57 % 6.21 % 5.84 % 6.51 % 6.59 % 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 View original content: https://www.prnewswire.com/news-releases/first-financial-bancorp-announces-fourth-quarter-and-full-year-2023-financial-results-and-quarterly-dividend-302045138.html SOURCE First Financial Bancorp .

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