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Heartland Financial USA, Inc. ("HTLF") Reports Annual Earnings and Fourth Quarter Results as of December 31, 2023

Fourth Quarter Highlights

  • Net loss available to common stockholders of ($72.4) million or ($1.69) per diluted common share.
  • Adjusted earnings available to common stockholders of $45.6 million, or $1.06 per diluted common share (non-GAAP), which excludes losses related to balance sheet repositioning, losses on sale or write-down of assets, FDIC special assessment expense, and restructuring costs.
  • Loan growth of $196.2 million or 2%.
  • Average customer deposits grew $270.7 million or 2%.
  • Common equity ratio increased to 9.27%; Tangible common equity ratio (non-GAAP) improved 80 basis points to 6.53%.
  • Net interest margin, fully tax-equivalent (non-GAAP) improved 34 basis points to 3.52%.
  • Consolidated final charter, with an expense of $1.3 million in the quarter, and initiated HTLF 3.0, the Company's new strategic plan which includes:
    • Investing in growth through banker expansion and talent acquisition in the Central Valley of California, Denver, Kansas City, Milwaukee, Minneapolis, and Phoenix.
    • Expanding Treasury Management products and capabilities.
    • Creation of consumer and small business digital platforms.
    • Footprint and facilities optimization, with a focus on efficient return on capital.
  • In the quarter we took the following actions as part of HTLF 3.0:
    • An $865.4 million balance sheet repositioning resulting in a $140.0 million pre-tax loss.
    • Centralized retail management span of control with restructuring costs of $944,000.
    • Footprint consolidation resulting in $1.1 million in restructuring costs and $2.1 million in losses on sales/valuations of facilities.

 Quarter Ended
December 31,
 Year Ended December 31,
 2023 2022 2023 2022
Earnings Summary:       
Net income/(loss) available to common stockholders (in millions)$(72.4) $58.6  $71.9  $204.1 
Diluted earnings/(loss) per common share (1.69)  1.37   1.68   4.79 
Return on average assets(1.42)%  1.21%  0.40%  1.08%
Return on average common equity (16.61)  15.02   4.19   11.74 
Return on average tangible common equity (non-GAAP)(1) (24.88)  25.19   6.91   18.56 
Net interest margin 3.47   3.61   3.29   3.32 
Net interest margin, fully tax-equivalent (non-GAAP)(1) 3.52   3.65   3.33   3.37 
Efficiency ratio 293.86   60.05   79.58   61.03 
Adjusted efficiency ratio, fully-tax equivalent (non-GAAP)(1) 59.31   54.33   59.06   57.74 
        
Adjusted Earnings Summary (1):       
Adjusted earnings available to common stockholders (in millions)$45.6  $62.5  $193.9  $209.5 
Adjusted diluted earnings per common share 1.06   1.46   4.53   4.91 
Adjusted annualized return on average assets 0.96%  1.28%  1.01%  1.11%
Adjusted annualized return on average common equity 10.46   16.00   11.31   12.06 
Adjusted annualized return on average tangible common equity 16.38   26.77   17.82   19.03 
        
(1) Refer to "Non-GAAP Measures" in this earnings release for additional information on the usage and presentation of these non-GAAP measures, and refer to the financial tables for reconciliations to the most directly comparable GAAP measures.


“2023 was a year of significant progress and successful execution of HTLF’s strategic plans. With the completion of the charter consolidation initiative in the fourth quarter, we are now able to focus on HTLF 3.0, a set of initiatives that will drive improved efficiency, enhance EPS growth, deliver higher return on assets, and more efficient use of capital. The balance sheet repositioning, retail span of control and facilities optimization initiatives we executed during the quarter represent the beginning of HTLF 3.0.”
Bruce K. Lee, president and chief executive officer, HTLF
 

DENVER, Jan. 29, 2024 (GLOBE NEWSWIRE) -- Heartland Financial USA, Inc. (NASDAQ: HTLF) today reported the following results for the quarter ended December 31, 2023 compared to the quarter ended December 31, 2022:

  • Net income/(loss) available to common stockholders of ($72.4) million compared to $58.6 million, a decrease of $131.0 million or 223%. Adjusted earnings available to common stockholders(1) of $45.6 million compared to $62.5 million, a decrease of $16.9 million or 27%.
  • Earnings/(loss) per diluted common share of ($1.69) compared to $1.37, a decrease of $3.06. Adjusted diluted earnings per common share(1) of $1.06 compared to $1.46, a decrease of $0.40.
  • Net interest income of $156.1 million compared to $165.2 million, a decrease of $9.1 million or 5%.
  • Return on average assets of (1.42%) compared to 1.21%. Adjusted annualized return on average assets(1) of 0.96% compared to 1.28%.
  • Return on average common equity of (16.61%) compared to 15.02%. Adjusted annualized return on average common equity(1) of 10.46% compared to 16.00%.
  • Return on average tangible common equity(1) of (24.88%) compared to 25.19%. Adjusted annualized return on average tangible common equity(1) of 16.38% compared to 26.77%.

HTLF reported the following results for the year ended December 31, 2023 compared to the year ended December 31, 2022:

  • Net income available to common stockholders of $71.9 million compared to $204.1 million, a decrease of $132.3 million or 65%. Adjusted earnings available to common stockholders(1) of $193.9 million compared to $209.5 million, a decrease of $15.6 million or 7%.
  • Earnings per diluted common share of $1.68 compared to $4.79, a decrease of $3.11. Adjusted diluted earnings per common share(1) of $4.53 compared to $4.91, a decrease of $0.38 or 8%.
  • Net interest income of $601.2 million compared to $598.2 million, an increase of $3.0 million or 1%.
  • Return on average assets of 0.40% compared to 1.08%. Adjusted annualized return on average assets(1) of 1.01% compared to 1.11%.
  • Return on average common equity of 4.19% compared to 11.74%. Adjusted annualized return on average common equity(1) of 11.31% compared to 12.06%.
  • Return on average tangible common equity (non-GAAP) of 6.91% compared to 18.56%. Adjusted annualized return on average tangible common equity(1) of 17.82% compared to 19.03%.

Commenting on HTLF's 2023 results, Bruce K. Lee, HTLF’s president and chief executive officer, said, “2023 was a year of significant progress and successful execution of HTLF’s strategic plans. With the completion of the charter consolidation initiative in the fourth quarter, we are now able to focus on HTLF 3.0, a set of initiatives that will drive improved efficiency, enhance EPS growth, deliver higher return on assets, and more efficient use of capital. The balance sheet repositioning, retail span of control and facilities optimization initiatives we executed during the quarter represent the beginning of HTLF 3.0.”

Announced and Initiated HTLF 3.0

HTLF’s new strategic plan, HTLF 3.0, was announced and initiated in the fourth quarter of 2023. HTLF 3.0's initiatives include:

  • Investing in growth through banker expansion and talent acquisition in the Central Valley of California, Denver, Kansas City, Milwaukee, Minneapolis, and Phoenix.
  • Expanding Treasury Management products and capabilities.
  • Creation of consumer and small business digital platforms.
  • Footprint and facilities optimization, with a focus on efficient return on capital.

In the quarter we took the following actions as part of HTLF 3.0:

  • A $865.4 million balance sheet repositioning resulting in a $140.0 million pre-tax loss.
  • Centralized retail management span of control with restructuring costs of $944,000.
  • Footprint consolidation resulting in $1.1 million in restructuring costs and $2.1 million in losses on sales/valuations of facilities.

Charter Consolidation Update

During the fourth quarter of 2023, Dubuque Bank and Trust Company was consolidated into HTLF Bank, which successfully completed the consolidation of all 11 charters. Total consolidation restructuring costs were $17 million, of which $1.3 million were incurred in the fourth quarter of 2023.

Net Interest Income and Net Interest Margin

Net interest margin was 3.47% (3.52% on a fully tax-equivalent basis, non-GAAP) during the fourth quarter of 2023, compared to 3.61% (3.65% on a fully tax-equivalent basis, non-GAAP) during the fourth quarter of 2022.

Total interest income and average earning asset changes for the fourth quarter of 2023 compared to the fourth quarter of 2022 were:

  • Total interest income was $255.9 million compared to $204.7 million, an increase of $51.2 million or 25%, primarily attributable to higher yields and an increase in average loans.
  • Total interest income on a tax-equivalent basis was $257.9 million, an increase of $51.1 million or 25%, from $206.9 million.
  • Average earning assets decreased $321.9 million or 2% to $17.85 billion compared to $18.17 billion, which was primarily attributable to the balance sheet repositioning completed in the fourth quarter of 2023.
  • The average rate on earning assets increased 121 basis points to 5.73% from 4.52%, primarily due to recent interest rate increases.

Total interest expense and average interest-bearing liability changes for the fourth quarter of 2023 compared to the fourth quarter of 2022 were:

  • Total interest expense was $99.7 million, an increase of $60.3 million from $39.5 million, due to increases in the average interest rate paid and the average balance of interest-bearing liabilities.
  • The average interest rate paid on interest-bearing liabilities increased 180 basis points to 3.11% from 1.31%.
  • Average interest-bearing deposits increased $638.2 million or 6% to $11.95 billion from $11.31 billion, primarily due to growth in time deposits. Total average interest-bearing deposits were 72% of total average deposits compared to 65%.
  • The average interest rate paid on HTLF's interest-bearing deposits increased 179 basis points to 2.92% from 1.13%.
  • Average borrowings increased $103.4 million or 15% to $773.7 million from $670.2 million, and the average interest rate paid on borrowings was 5.99% compared to 4.30%.

Net interest income changes for the fourth quarter of 2023 compared to the fourth quarter of 2022 were:

  • Net interest income totaled $156.1 million compared to $165.2 million, a decrease of $9.1 million or 5%.
  • Net interest income on a tax-equivalent basis (non-GAAP) totaled $158.2 million compared to $167.4 million, a decrease of $9.2 million or 5%.

Noninterest Income and Noninterest Expense

Total noninterest income was ($111.8) million during the fourth quarter of 2023 compared to $30.0 million during the fourth quarter of 2022, a decrease of $141.8 million. Significant changes by noninterest income category for the fourth quarter of 2023 compared to the fourth quarter of 2022 were:

  • Service charges and fees increased $1.3 million or 7% to $18.7 million from $17.4 million, which was primarily attributable to an increase in debit interchange volume.
  • Net securities losses totaled $140.0 million compared to net securities losses of $153,000, which was an increase of $139.9 million attributable to the balance sheet repositioning strategy executed in the quarter.
  • Net gains of sales of loans held for sale decreased $794,000 to $94,000 compared to $888,000, primarily due to a decrease of loans sold to the secondary market as HTLF exits mortgage loan originations through PrimeWest.

Total noninterest expense for the fourth quarter of 2023 was $130.3 million compared to $117.2 million for the same quarter of 2022, which was an increase of $13.1 million or 11%. Significant changes within the noninterest expense category for the fourth quarter of 2023 compared to the fourth quarter of 2022 were:

  • Salaries and employee benefits totaled $64.8 million compared to $61.6 million, which was an increase of $3.2 million or 5%. The fourth quarter of 2023 included $813,000 higher severance related expenses and the fourth quarter of 2022 included a $1.5 million benefit associated with the employer tax credit. Increases in other components of salary expenses during the fourth quarter of 2023 were largely offset by lower incentive compensation expense.
  • FDIC insurance assessment of $10.3 million, which included a one-time special assessment of $8.1 million in the fourth quarter of 2023 compared to $1.9 million in the fourth quarter of 2022, which was an increase of $8.4 million.
  • Acquisition, integration and restructuring costs totaled $4.4 million compared to $2.4 million, an increase of $1.9 million or 79% due to the addition of HTLF 3.0 initiatives and the completion of the charter consolidation project.
  • Partnership investment in tax credit projects increased $326,000 or 10% to $3.6 million compared to $3.2 million. The expense is dependent upon the number and timing of tax credit projects placed into service.

HTLF's effective tax rate was 27.97% for the fourth quarter of 2023 compared to 18.67% for the fourth quarter of 2022. The following items impacted HTLF's fourth quarter 2023 and 2022 tax calculations:

  • Various tax credits of $3.8 million compared to $3.6 million.
  • Tax expense of $1.3 million compared to $561,000 resulting from disallowed interest expense related to tax-exempt loans and securities, aligning with the increases in total interest expense.
  • Tax-exempt interest income as a percentage of pre-tax income of (7.93%) compared to 10.85%.

For the years ended December 31, 2023 and 2022, HTLF's effective tax rate was 17.42% and 20.76%, respectively.

Total Assets, Total Loans and Total Deposits

Total assets were $19.41 billion at December 31, 2023, a decrease of $832.5 million or 4% from $20.24 billion at year-end 2022. Securities represented 29% and 35% of total assets at December 31, 2023, and December 31, 2022, respectively, primarily due to the balance sheet repositioning.

Total loans held to maturity were $12.07 billion at December 31, 2023, compared to $11.87 billion at September 30, 2023 and $11.43 billion at December 31, 2022. Loans increased $196.2 million or 2% during the fourth quarter of 2023 and $640.3 million or 6% since year-end 2022.

Significant changes by loan category at December 31, 2023 compared to September 30, 2023 included:

  • Commercial and business lending, which includes commercial and industrial, PPP, and owner occupied commercial real estate loans, increased $267.8 million or 4% to $6.29 billion at December 31, 2023, compared to $6.03 billion at September 30, 2023.
  • Commercial real estate lending, which includes non-owner occupied commercial real estate and construction loans, decreased $120.5 million or 3% to $3.57 billion from $3.69 billion.
  • Agricultural and agricultural real estate loans totaled $919.2 million compared to $842.1 million, an increase of $77.1 million or 9%.
  • Residential loans totaled $797.8 million compared to $813.8 million, a decrease of $16.0 million or 2%.
  • Consumer loans decreased $12.2 million or 2% to $493.2 million from $505.4 million.

Significant changes by loan category at December 31, 2023 compared to December 31, 2022 included:

  • Commercial and business lending, which includes commercial and industrial, PPP, and owner occupied commercial real estate loans, increased $552.3 million or 10% to $6.29 billion at December 31, 2023, compared to $5.74 billion at December 31, 2022.
  • Commercial real estate lending, which includes non-owner occupied commercial real estate and construction loans, increased $158.4 million or 5% to $3.57 billion from $3.41 billion.
  • Agricultural and agricultural real estate loans totaled $919.2 million, a decrease of $1.3 million or less than 1% from $920.5 million.
  • Residential loans totaled $797.8 million compared to $853.4 million, a decrease of $55.5 million or 7%.
  • Consumer loans decreased $13.5 million or 3% to $493.2 million from $506.7 million.

Total deposits were $16.20 billion as of December 31, 2023, compared to $17.10 billion at September 30, 2023, which was a decrease of $899.3 million or 5%. Total deposits were $16.2 billion as of December 31, 2023, compared to $17.51 billion at December 31, 2022, a decrease of $1.31 billion or 7%.

Total customer deposits were $14.86 billion as of December 31, 2023, compared to $14.80 billion at September 30, 2023, which was an increase of $58.8 million or less than 1%. Significant customer deposit changes by category at December 31, 2023, compared to September 30, 2023, included:

  • Customer demand deposits decreased $292.5 million or 6% to $4.50 billion compared to $4.79 billion.
  • Customer savings deposits increased $220.8 million or 3% to $8.41 billion compared to $8.19 billion.
  • Customer time deposits increased $130.5 million or 7% to $1.94 billion compared to $1.81 billion.

Total customer deposits were $14.86 billion at December 31, 2023 compared to $15.22 billion at December 31, 2022, which was a decrease of $367.3 million or 2%. Significant customer deposit changes by category at December 31, 2023 compared to December 31, 2022, included:

  • Customer demand deposits decreased $1.20 billion or 21% to $4.50 billion compared to $5.70 billion.
  • Customer savings deposits decreased $259.7 million or 3% to $8.41 billion compared to $8.67 billion.
  • Customer time deposits increased $1.09 billion to $1.94 billion compared to $851.5 million.

Total wholesale and institutional deposits were $1.35 billion as of December 31, 2023, which was a decrease of $958.1 million or 42% from $2.30 billion at September 30, 2023. Significant wholesale and institutional deposit changes by category at December 31, 2023, compared to September 30, 2023, included:

  • Wholesale and institutional savings deposits decreased $170.1 million or 30% to $394.4 million compared to $564.5 million.
  • Wholesale time deposits decreased $788.0 million or 45% to $950.9 million compared to $1.74 billion.

Total wholesale and institutional deposits were $1.35 billion as of December 31, 2023, which was a decrease of $943.9 million or 41% from $2.29 billion at December 31, 2022. Significant wholesale and institutional deposit changes by category at December 31, 2023 compared to December 31, 2022 included:

  • Wholesale and institutional savings deposits decreased $929.1 million or 70% to $394.4 million compared to $1.32 billion.
  • Wholesale time deposits decreased $14.8 million or 2% to $950.9 million compared to $965.7 million.

Provision and Allowance

Provision and Allowance for Credit Losses for Loans
Provision for credit losses for loans for the fourth quarter of 2023 was $12.8 million, which was an increase of $10.7 million from $2.1 million of provision benefit recorded in the fourth quarter of 2022. The provision expense for the fourth quarter of 2023 was primarily impacted by a customer that moved to non accrual due to its abrupt decision to discontinue business operations.

HTLF's allowance for credit losses for loans totaled $122.6 million at December 31, 2023, compared to $109.5 million at December 31, 2022, respectively. The following items impacted HTLF's allowance for credit losses for loans for the year ended December 31, 2023:

  • Provision expense for the year ended December 31, 2023, totaled $25.4 million.
  • Net charge-offs of $12.4 million were recorded for the year or 0.11% of average loans. Net charge-offs of $392,000 were recorded in the fourth quarter of 2022 or 0.01% of average loans.

Provision and Allowance for Credit Losses for Unfunded Commitments
HTLF's allowance for unfunded commitments totaled $16.5 million and $20.2 million at December 31, 2023 and December 31, 2022, respectively. The following impacted HTLF's allowance for credit losses for unfunded commitments during 2023:

  • Provision benefit for the year ended December 31, 2023, totaled $3.7 million.
  • Unfunded commitments decreased $103.9 million or 2% to $4.63 billion at December 31, 2023 compared to $4.73 billion at December 31, 2022.

Total Provision and Allowance for Lending Related Credit Losses
The total provision expense for lending related credit losses was $11.7 million for the fourth quarter of 2023 compared to $3.4 million for the fourth quarter of 2022. The total allowance for lending related credit losses was $139.0 million at December 31, 2023, which was 1.15% of total loans as of December 31, 2023, compared to $129.7 million or 1.13% of total loans as of December 31, 2022.

Nonperforming Assets

Nonperforming assets increased $43.6 million or 65% to $110.5 million, which was 0.57% of total assets at December 31, 2023, compared to $66.9 million or 0.33% of total assets at December 31, 2022. The increase was primarily driven by a well-collateralized long-term manufacturing customer who is experiencing cash flow challenges due to a recent acquisition. Nonperforming loans were $97.9 million or 0.81% of total loans at December 31, 2023, compared to $58.5 million or 0.51% of total loans at December 31, 2022. At December 31, 2023, loans delinquent 30-89 days were 0.09% of total loans compared to 0.04% of total loans at December 31, 2022.

Non-GAAP Financial Measures

This earnings release contains references to financial measures which are not defined by generally accepted accounting principles ("GAAP"). Management believes the non-GAAP measures are helpful for investors to analyze and evaluate the company's financial condition and operating results. However, these non-GAAP measures have inherent limitations and should not be considered a substitute for operating results determined in accordance with GAAP. Additionally, because non-GAAP measures are not standardized, it may not be possible to compare the non-GAAP measures in this earnings release with other companies' non-GAAP measures. Reconciliations of each non-GAAP measure to the most directly comparable GAAP measure may be found in the financial tables in this earnings release.

Below are the non-GAAP measures included in this earnings release, management's reason for including each measure and the method of calculating each measure:

  • Adjusted earnings available to common stockholders, adjusts net income for the loss from sale of securities, and other non-operating expenses as well as the tax effect of those transactions. Management believes this measure enhances the comparability net income available to common stockholders as it reflects adjustments commonly made by management, investors and analysts to evaluate the ongoing operations and enhance comparability with the results of prior periods.
  • Adjusted annualized return on average assets, adjusts net income for the loss from sale of securities, and other non-operating expenses as well as the tax effect of those transactions. Management believes this measure enhances the comparability of annualized return on average assets as it reflects adjustments commonly made by management, investors and analysts to evaluate the ongoing operations and enhance comparability with the results of prior periods.
  • Annualized net interest margin, fully tax-equivalent, adjusts net interest income for the tax-favored status of certain loans and securities. Management believes this measure enhances the comparability of net interest income arising from taxable and tax-exempt sources.
  • Adjusted efficiency ratio, fully tax equivalent, expresses noninterest expenses as a percentage of fully tax-equivalent net interest income and noninterest income. This efficiency ratio is presented on a tax-equivalent basis which adjusts net interest income and noninterest expenses for the tax favored status of certain loans, securities, and tax credit projects. Management believes the presentation of this non-GAAP measure provides supplemental useful information for proper understanding of the financial results as it enhances the comparability of income and expenses arising from taxable and nontaxable sources and excludes specific items as noted in reconciliation contained in this earnings release.
  • Net interest income, fully tax equivalent, is net income adjusted for the tax-favored status of certain loans and securities. Management believes this measure enhances the comparability of net interest income arising from taxable and tax-exempt sources. Net interest margin, fully tax equivalent, is net interest income adjusted for the tax-favored status of certain loans and securities divided by average earning assets.
  • Tangible book value per common share is total common equity less goodwill and core deposit and customer relationship intangibles, net, divided by common shares outstanding, net of treasury. This measure is included as it is considered to be a critical metric to analyze and evaluate use of equity, financial condition and capital strength.
  • Tangible common equity ratio is total common equity less goodwill and core deposit and customer relationship intangibles, net, divided by total assets less goodwill and core deposit and customer relationship intangibles, net. This measure is included as it is considered to be a critical metric to analyze and evaluate financial condition and capital strength.
  • Adjusted annualized return on average common equity, adjusts net income for the loss from sale of securities, and other non-operating expenses as well as the tax effect of those transactions. Management believes this measure enhances the comparability of annualized return on average assets as it reflects adjustments commonly made by management, investors and analysts to evaluate the ongoing operations and enhance comparability with the results of prior periods.
  • Annualized return on average tangible common equity is net income excluding intangible amortization calculated as (1) net income excluding tax-effected core deposit and customer relationship intangibles amortization, divided by (2) average common equity less goodwill and core deposit and customer relationship intangibles, net. This measure is included as it is considered to be a critical metric to analyze and evaluate use of equity, financial condition and capital strength.
  • Adjusted annualized return on average tangible common equity, adjusts net income available to common stockholders for the loss from sale of securities, and other non-operating expenses as well as the tax effect of those transactions. Management believes this measure enhances the comparability of annualized return on average assets as it reflects adjustments commonly made by management, investors and analysts to evaluate the ongoing operations and enhance comparability with the results of prior periods.
  • Annualized ratio of core expenses to average assets adjusts noninterest expenses to exclude specific items noted in the reconciliation. Management includes this measure as it is considered to be a critical metric to analyze and evaluate controllable expenses related to primary business operations.

Conference Call Details

HTLF will host a conference call for shareholders, analysts and other interested parties at 5:00 p.m. EDT today. To join via webcast, please visit https://ir.htlf.com/news-and-events/event-calendar/default.aspx 10 minutes prior to the call. A replay will be available until January 28, 2025, by logging on to www.htlf.com.

About HTLF

Heartland Financial USA, Inc., operating under the brand name HTLF, is a bank holding company with assets of $19.41 billion. HTLF has banks serving communities in Arizona, California, Colorado, Illinois, Iowa, Kansas, Minnesota, Missouri, Montana, New Mexico, Texas and Wisconsin. HTLF is committed to its core commercial business, supported by a strong retail operation, and provides a diversified line of financial services including treasury management, wealth management, investments and residential mortgage. Additional information is available at www.htlf.com.

Safe Harbor Statement

This release (including any information incorporated herein by reference), and future oral and written statements of the company and its management, may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, with respect to the business, financial condition, results of operations, plans, objectives and future performance of HTLF.

Any statements about the company's expectations, beliefs, plans, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. Forward-looking statements may include information about possible or assumed future results of the company's operations or performance. These forward-looking statements are generally identified by the use of the words such as "believe", "expect", "intent", "anticipate", "plan", "intend", "estimate", "project", "may", "will", "would", "could", "should", "may", "view", "opportunity", "potential", or similar or negative expressions of these words or phrases that are used in this release, and future oral and written statements of the company and its management. Although the company may make these statements based on management’s experience, beliefs, expectations, assumptions and best estimate of future events, the ability of the company to predict results or the actual effect or outcomes of plans or strategies is inherently uncertain, and there may be events or factors that management has not anticipated. Therefore, the accuracy and achievement of such forward-looking statements and estimates are subject to a number of risks, many of which are beyond the ability of management to control or predict, that could cause actual results to differ materially from those in its forward-looking statements. These factors, which the company currently believes could have a material effect on its operations and future prospects, are detailed below and in the risk factors in HTLF's reports filed with the Securities and Exchange Commission ("SEC"), including the "Risk Factors" section under Item 1A of Part I of the company’s Annual Report on Form 10-K for the year ended December 31, 2022, include, among others:

  • Economic and Market Conditions Risks, including risks related to the deterioration of the U.S. economy in general and in the local economies in which HTLF conducts its operations and future civil unrest, natural disasters, pandemics and governmental measures addressing them, climate change and climate-related regulations, persistent inflation, higher interest rates, supply chain issues, labor shortages, terrorist threats or acts of war;
  • Credit Risks, including risks of increasing credit losses due to deterioration in the financial condition of HTLF's borrowers, changes in asset and collateral values due to climate and other borrower industry risks, which may impact the provision for credit losses and net charge-offs;
  • Liquidity and Interest Rate Risks, including the impact of capital market conditions, rising interest rates and changes in monetary policy on our borrowings and net interest income;
  • Operational Risks, including processing, information systems, cybersecurity, vendor, business interruption, and fraud risks;
  • Strategic and External Risks, including economic, political, and competitive forces impacting our business;
  • Legal, Compliance and Reputational Risks, including regulatory and litigation risks; and
  • Risks of Owning Stock in HTLF, including stock price volatility and dilution as a result of future equity offerings and acquisitions.

There can be no assurance that other factors not currently anticipated by HTLF will not materially and adversely affect HTLF's business, financial condition and results of operations. Additionally, all statements in this release, including forward-looking statements speak only as of the date they are made. HTLF does not undertake and specifically disclaims any obligation to publicly release the results of any revisions which may be made to or correct or update any forward-looking statement to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events or to otherwise update any statement in light of new information or future events. Further information concerning HTLF and its business, including additional factors that could materially affect HTLF's financial results, is included in HTLF’s filings with the SEC.

-FINANCIAL TABLES FOLLOW-

CONTACT:
Kevin L. Thompson
Executive Vice President
Chief Financial Officer
(563) 589-1994
kthompson@htlf.com 

 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 For the Quarter Ended
December 31,
 For the Year Ended
December 31,
 2023 2022 2023 2022
Interest Income       
Interest and fees on loans$192,861  $143,970  $697,997  $477,970 
Interest on securities:       
Taxable 54,573   53,178   223,521   169,544 
Nontaxable 6,278   6,132   25,268   24,006 
Interest on federal funds sold    11   3   11 
Interest on deposits with other banks and short-term investments 2,174   1,410   7,007   3,125 
Total Interest Income 255,886   204,701   953,796   674,656 
Interest Expense       
Interest on deposits 88,071   32,215   319,688   56,880 
Interest on borrowings 5,874   2,223   10,311   2,717 
Interest on term debt 5,804   5,043   22,560   16,823 
Total Interest Expense 99,749   39,481   352,559   76,420 
Net Interest Income 156,137   165,220   601,237   598,236 
Provision for credit losses 11,738   3,387   21,707   15,370 
Net Interest Income After Provision for Credit Losses 144,399   161,833   579,530   582,866 
Noninterest Income       
Service charges and fees 18,708   17,432   74,024   68,031 
Loan servicing income 158   790   1,561   2,741 
Trust fees 4,905   5,440   20,715   22,570 
Brokerage and insurance commissions 729   629   2,794   2,986 
Capital market fees 1,676   1,824   10,007   11,543 
Securities gains (losses), net (140,007)  (153)  (141,539)  (425)
Unrealized gain (loss) on equity securities, net 75   (7)  240   (622)
Net gains on sale of loans held for sale 94   888   3,880   9,032 
Valuation adjustment on servicing rights          1,658 
Income on bank owned life insurance 729   600   3,771   2,341 
Other noninterest income 1,132   2,532   3,621   8,409 
Total Noninterest Income (111,801)  29,975   (20,926)  128,264 
Noninterest Expense       
Salaries and employee benefits 64,766   61,611   251,276   254,478 
Occupancy 6,509   6,905   26,847   28,155 
Furniture and equipment 2,901   3,019   11,599   12,499 
Professional fees 17,060   16,320   58,667   58,606 
FDIC insurance assessments 10,313   1,866   19,940   7,000 
Advertising 1,677   1,829   8,347   6,221 
Core deposit and customer relationship intangibles amortization 1,611   1,841   6,739   7,834 
Other real estate and loan collection expenses, net 505   373   1,489   950 
(Gain) loss on sales/valuations of assets, net 2,072   2,388   (77)  (1,047)
Acquisition, integration and restructuring costs 4,365   2,442   10,359   7,586 
Partnership investment in tax credit projects 3,573   3,247   5,401   5,040 
Other noninterest expenses 14,933   15,377   61,240   56,055 
Total Noninterest Expense 130,285   117,218   461,827   443,377 
Income Before Income Taxes (97,687)  74,590   96,777   267,753 
Income taxes (27,324)  13,936   16,857   55,573 
Net Income/(Loss) (70,363)  60,654   79,920   212,180 
Preferred dividends (2,012)  (2,012)  (8,050)  (8,050)
Net Income/(Loss) Available to Common Stockholders$(72,375) $58,642  $71,870  $204,130 
Earnings/(loss) per common share-diluted$(1.69) $1.37  $1.68  $4.79 
Weighted average shares outstanding-diluted 42,838,405   42,699,752   42,791,795   42,630,703 
                


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 For the Quarter Ended
 12/31/2023 9/30/2023 6/30/2023 3/31/2023 12/31/2022
Interest Income         
Interest and fees on loans$192,861  $182,394  $168,899  $153,843  $143,970 
Interest on securities:         
Taxable 54,573   54,800   58,172   55,976   53,178 
Nontaxable 6,278   6,584   6,378   6,028   6,132 
Interest on federal funds sold    3         11 
Interest on deposits with other banks and short-term investments 2,174   1,651   2,051   1,131   1,410 
Total Interest Income 255,886   245,432   235,500   216,978   204,701 
Interest Expense         
Interest on deposits 88,071   92,744   81,975   56,898   32,215 
Interest on borrowings 5,874   1,167   848   2,422   2,223 
Interest on term debt 5,804   5,765   5,545   5,446   5,043 
Total Interest Expense 99,749   99,676   88,368   64,766   39,481 
Net Interest Income 156,137   145,756   147,132   152,212   165,220 
Provision for credit losses 11,738   1,516   5,379   3,074   3,387 
Net Interest Income After Provision for Credit Losses 144,399   144,240   141,753   149,138   161,833 
Noninterest Income         
Service charges and fees 18,708   18,553   19,627   17,136   17,432 
Loan servicing income 158   278   411   714   790 
Trust fees 4,905   4,734   5,419   5,657   5,440 
Brokerage and insurance commissions 729   692   677   696   629 
Capital markets fees 1,676   1,845   4,037   2,449   1,824 
Securities gains (losses), net (140,007)  (114)  (314)  (1,104)  (153)
Unrealized gain (loss) on equity securities, net 75   13   (41)  193   (7)
Net gains on sale of loans held for sale 94   905   1,050   1,831   888 
Valuation adjustment on servicing rights              
Income on bank owned life insurance 729   858   1,220   964   600 
Other noninterest income 1,132   619   407   1,463   2,532 
Total Noninterest Income (111,801)  28,383   32,493   29,999   29,975 
Noninterest Expense         
Salaries and employee benefits 64,766   62,262   62,099   62,149   61,611 
Occupancy 6,509   6,438   6,691   7,209   6,905 
Furniture and equipment 2,901   2,720   3,063   2,915   3,019 
Professional fees 17,060   13,616   15,194   12,797   16,320 
FDIC insurance assessments 10,313   3,313   3,035   3,279   1,866 
Advertising 1,677   1,633   3,052   1,985   1,829 
Core deposit and customer relationship intangibles amortization 1,611   1,625   1,715   1,788   1,841 
Other real estate and loan collection expenses, net 505   481   348   155   373 
(Gain) loss on sales/valuations of assets, net 2,072   108   (3,372)  1,115   2,388 
Acquisition, integration and restructuring costs 4,365   2,429   1,892   1,673   2,442 
Partnership investment in tax credit projects 3,573   1,136   154   538   3,247 
Other noninterest expenses 14,933   15,292   15,575   15,440   15,377 
Total Noninterest Expense 130,285   111,053   109,446   111,043   117,218 
Income Before Income Taxes (97,687)  61,570   64,800   68,094   74,590 
Income taxes (27,324)  13,479   15,384   15,318   13,936 
Net Income/(Loss) (70,363)  48,091   49,416   52,776   60,654 
Preferred dividends (2,012)  (2,013)  (2,012)  (2,013)  (2,012)
Net Income/(Loss) Available to Common Stockholders$(72,375) $46,078  $47,404  $50,763  $58,642 
Earnings/(loss) per common share-diluted$(1.69) $1.08  $1.11  $1.19  $1.37 
Weighted average shares outstanding-diluted 42,838,405   42,812,563   42,757,603   42,742,878   42,699,752 
                    


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 As of
 12/31/2023 9/30/2023 6/30/2023 3/31/2023 12/31/2022
Assets         
Cash and due from banks$275,554  $248,756  $317,303  $274,354  $309,045 
Interest-bearing deposits with other banks and other short-term investments 47,459   99,239   82,884   87,757   54,042 
Cash and cash equivalents 323,013   347,995   400,187   362,111   363,087 
Time deposits in other financial institutions 1,240   1,490   1,490   1,740   1,740 
Securities:         
Carried at fair value 4,646,891   5,482,687   5,798,041   6,096,657   6,147,144 
Held to maturity, at cost 838,241   835,468   834,673   832,098   829,403 
Other investments, at cost 91,277   90,001   72,291   72,364   74,567 
Loans held for sale 5,071   6,262   14,353   10,425   5,277 
Loans:         
Held to maturity 12,068,645   11,872,436   11,717,974   11,495,353   11,428,352 
Allowance for credit losses (122,566)  (110,208)  (111,198)  (112,707)  (109,483)
Loans, net 11,946,079   11,762,228   11,606,776   11,382,646   11,318,869 
Premises, furniture and equipment, net 181,070   187,436   190,420   191,267   197,330 
Goodwill 576,005   576,005   576,005   576,005   576,005 
Core deposit and customer relationship intangibles, net 18,415   20,026   21,651   23,366   25,154 
Servicing rights, net             7,840 
Cash surrender value on life insurance 197,085   196,694   195,793   194,419   193,403 
Other real estate, net 12,548   14,362   2,677   7,438   8,401 
Other assets 574,772   609,139   510,359   432,008   496,008 
Total Assets$19,411,707  $20,129,793  $20,224,716  $20,182,544  $20,244,228 
Liabilities and Equity         
Liabilities         
Deposits:         
Demand$4,500,304  $4,792,813  $4,897,858  $5,119,554  $5,701,340 
Savings 8,805,597   8,754,911   8,772,596   9,256,609   9,994,391 
Time 2,895,813   3,553,269   3,993,089   3,305,183   1,817,278 
Total deposits 16,201,714   17,100,993   17,663,543   17,681,346   17,513,009 
Borrowings 622,255   392,634   44,364   92,337   376,117 
Term debt 372,396   372,059   372,403   372,097   371,753 
Accrued expenses and other liabilities 282,225   438,577   285,416   207,359   248,294 
Total Liabilities 17,478,590   18,304,263   18,365,726   18,353,139   18,509,173 
Stockholders' Equity         
Preferred equity 110,705   110,705   110,705   110,705   110,705 
Common stock 42,688   42,656   42,645   42,559   42,467 
Capital surplus 1,090,740   1,088,267   1,087,358   1,084,112   1,080,964 
Retained earnings 1,141,501   1,226,740   1,193,522   1,158,948   1,120,925 
Accumulated other comprehensive income/(loss) (452,517)  (642,838)  (575,240)  (566,919)  (620,006)
Total Equity 1,933,117   1,825,530   1,858,990   1,829,405   1,735,055 
Total Liabilities and Equity$19,411,707  $20,129,793  $20,224,716  $20,182,544  $20,244,228 
                    


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 For the Quarter Ended
 12/31/2023 9/30/2023 6/30/2023 3/31/2023 12/31/2022
Average Balances         
Assets$19,667,825  $20,207,920  $20,221,511  $20,118,005  $19,913,849 
Loans, net of unearned 11,938,272   11,800,064   11,625,442   11,378,078   11,117,513 
Total deposits 16,709,394   17,507,813   17,689,138   17,505,867   17,319,218 
Customer deposits 14,969,948   14,699,235   14,655,535   15,123,181   15,739,698 
Earning assets 17,853,957   18,439,010   18,523,552   18,392,649   18,175,838 
Interest-bearing liabilities 12,721,680   13,158,631   13,209,794   12,582,234   11,980,032 
Common equity 1,729,086   1,746,818   1,727,013   1,655,860   1,548,739 
Total stockholders' equity 1,839,791   1,857,523   1,837,718   1,766,565   1,659,444 
Tangible common equity (non-GAAP)(1) 1,133,888   1,149,992   1,128,527   1,055,617   946,688 
          
Key Performance Ratios         
Annualized return on average assets(1.42)%  0.94%  0.98%  1.06%  1.21%
Adjusted annualized return on average assets (non-GAAP)(1) 0.96   0.98   0.96   1.12   1.28 
Annualized return on average common equity (GAAP) (16.61)  10.47   11.01   12.43   15.02 
Adjusted annualized return on average common equity (non-GAAP)(1) 10.46   10.92   10.80   13.16   16.00 
Annualized return on average tangible common equity (non-GAAP)(1) (24.89)  16.32   17.31   20.03   25.17 
Adjusted annualized return on average tangible common equity (non-GAAP)(1) 16.38   17.02   17.00   21.17   26.77 
Annualized ratio of net charge-offs (recoveries) to average loans 0.01   0.12   0.32   (0.04)  (0.06)
Annualized net interest margin (GAAP) 3.47   3.14   3.19   3.36   3.61 
Annualized net interest margin, fully tax-equivalent (non-GAAP)(1) 3.52   3.18   3.23   3.40   3.65 
Efficiency ratio (GAAP) 293.86   63.77   60.93   60.94   60.05 
Adjusted efficiency ratio, fully tax-equivalent (non-GAAP)(1) 59.31   59.95   59.88   57.16   54.33 
Annualized ratio of total noninterest expenses to average assets (GAAP) 2.63   2.18   2.17   2.24   2.34 
Annualized ratio of core expenses to average assets (non-GAAP)(1) 2.23   2.08   2.16   2.14   2.14 
          
(1) Refer to "Non-GAAP Measures" in this earnings release for additional information on the usage and presentation of these non-GAAP measures, and refer to these financial tables for the reconciliations to the most directly comparable GAAP measures.
 


    
 For the Quarter Ended
December 31,
 For the Year Ended
December 31,
 2023 2022 2023 2022
Average Balances       
Assets$19,667,825  $19,913,849  $20,053,004  $19,621,839 
Loans, net of unearned 11,938,272   11,117,513   11,687,313   10,608,831 
Deposits 16,709,394   17,319,218   17,351,294   17,029,398 
Earning assets 17,853,957   18,175,838   18,301,190   18,021,134 
Interest-bearing liabilities 12,721,680   11,980,032   12,919,125   11,437,921 
Common equity 1,729,086   1,548,739   1,714,983   1,738,041 
Total stockholders' equity 1,839,791   1,659,444   1,825,688   1,848,746 
Tangible common equity (non-GAAP)(1) 1,133,888   946,688   1,117,311   1,133,124 
        
Key Performance Ratios       
Annualized return on average assets(1.42)%  1.21%  0.40%  1.08%
Adjusted annualized return on average assets (non-GAAP)(1) 0.96   1.28   1.01   1.11 
Annualized return on average common equity (GAAP) (16.61)  15.02   4.19   11.74 
Adjusted annualized return on average common equity (non-GAAP)(1) 10.46   16.00   11.31   12.06 
Annualized return on average tangible common equity (non-GAAP)(1) (24.89)  25.17   6.89   18.55 
Adjusted annualized return on average tangible common equity (non-GAAP)(1) 16.38   26.77   17.82   19.03 
Annualized ratio of net charge-offs (recoveries) to average loans 0.01   (0.06)  0.11   0.11 
Annualized net interest margin (GAAP) 3.47   3.61   3.29   3.32 
Annualized net interest margin, fully tax-equivalent (non-GAAP)(1) 3.52   3.65   3.33   3.37 
Efficiency ratio (GAAP) 293.86   60.05   79.58   61.03 
Adjusted efficiency ratio, fully tax-equivalent (non-GAAP)(1) 59.31   54.33   59.06   57.74 
Annualized ratio of total noninterest expenses to average assets (GAAP) 2.63   2.34   2.30   2.26 
Annualized ratio of core expenses to average assets (non-GAAP)(1) 2.23   2.14   2.15   2.16 
        
(1) Refer to "Non-GAAP Measures" in this earnings release for additional information on the usage and presentation of these non-GAAP measures, and refer to these financial tables for the reconciliations to the most directly comparable GAAP measures.
 


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE AND FULL TIME EQUIVALENT EMPLOYEE DATA
 As of and for the Quarter Ended
 12/31/2023 9/30/2023 6/30/2023 3/31/2023 12/31/2022
Common Share Data         
Book value per common share$42.69  $40.20  $41.00  $40.38  $38.25 
Tangible book value per common share (non-GAAP)(1) 28.77   26.23   26.98   26.30   24.09 
ASC 320 effect on book value per common share (11.00)  (16.27)  (14.04)  (13.35)  (14.58)
          
Common shares outstanding, net of treasury stock 42,688,008   42,656,303   42,644,544   42,558,726   42,467,394 
          
Capital Ratios         
Common equity ratio 9.27%  8.49%  8.65%  8.54%  8.16%
Tangible common equity ratio (non-GAAP)(1) 6.53   5.73   5.86   5.72   5.21 
Tier 1 leverage ratio 9.44   9.59   9.40   9.25   9.13 
Common equity tier 1 ratio(2) 10.97   11.37   11.33   11.28   11.07 
Total risk based capital ratio(2) 14.53   14.90   14.93   14.98   14.76 
          
Other Selected Trend Information         
Effective tax rate 27.97%  21.89%  23.74%  22.50%  18.68%
Full time equivalent employees 1,970   1,965   1,966   1,991   2,002 
          
Loans Held to Maturity         
Commercial and industrial$3,652,047  $3,591,809  $3,590,680  $3,498,345  $3,464,414 
Paycheck Protection Program ("PPP") 2,777   3,750   4,139   8,258   11,025 
Owner occupied commercial real estate 2,638,175   2,429,659   2,398,698   2,312,538   2,265,307 
Commercial and business lending 6,292,999   6,025,218   5,993,517   5,819,141   5,740,746 
Non-owner occupied commercial real estate 2,553,711   2,656,358   2,530,736   2,421,341   2,330,940 
Real estate construction 1,011,716   1,029,554   1,013,134   1,102,186   1,076,082 
Commercial real estate lending 3,565,427   3,685,912   3,543,870   3,523,527   3,407,022 
Total commercial lending 9,858,426   9,711,130   9,537,387   9,342,668   9,147,768 
Agricultural and agricultural real estate 919,184   842,116   839,817   810,183   920,510 
Residential mortgage 797,829   813,803   828,437   841,084   853,361 
Consumer 493,206   505,387   512,333   501,418   506,713 
Total loans held to maturity$12,068,645  $11,872,436  $11,717,974  $11,495,353  $11,428,352 
          
Total unfunded loan commitments$4,625,768  $4,813,798  $4,905,147  $4,867,925  $4,729,677 
          
Deposits         
Demand-customer$4,500,304  $4,792,813  $4,897,858  $5,119,554  $5,701,340 
Savings-customer 8,411,240   8,190,430   8,149,596   8,501,337   8,670,898 
Savings-wholesale and institutional 394,357   564,481   623,000   755,272   1,323,493 
Total savings 8,805,597   8,754,911   8,772,596   9,256,609   9,994,391 
Time-customer 1,944,884   1,814,335   1,597,849   1,071,476   851,539 
Time-wholesale 950,929   1,738,934   2,395,240   2,233,707   965,739 
Total time 2,895,813   3,553,269   3,993,089   3,305,183   1,817,278 
Total deposits$16,201,714  $17,100,993  $17,663,543  $17,681,346  $17,513,009 
          
Total customer deposits$14,856,428  $14,797,578  $14,645,303  $14,692,367  $15,223,777 
Total wholesale and institutional deposits 1,345,286   2,303,415   3,018,240   2,988,979   2,289,232 
Total deposits$16,201,714  $17,100,993  $17,663,543  $17,681,346  $17,513,009 
          
(1) Refer to "Non-GAAP Measures" in this earnings release for additional information on the usage and presentation of these non-GAAP measures, and refer to these financial tables for the reconciliations to the most directly comparable GAAP measures.
(2) December 31, 2023 calculation is preliminary.
 


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 As of and for the Quarter Ended
 12/31/2023 9/30/2023 6/30/2023 3/31/2023 12/31/2022
Allowance for Credit Losses-Loans         
Balance, beginning of period$110,208  $111,198  $112,707  $109,483  $105,715 
Provision (benefit) for credit losses 12,750   2,672   7,829   2,184   2,075 
Charge-offs (3,886)  (3,964)  (9,613)  (2,151)  (2,668)
Recoveries 3,494   302   275   3,191   4,361 
Balance, end of period$122,566  $110,208  $111,198  $112,707  $109,483 
          
Allowance for Unfunded Commitments         
Balance, beginning of period$17,480  $18,636  $21,086  $20,196  $18,884 
Provision for credit losses (1,012)  (1,156)  (2,450)  890   1,312 
Balance, end of period$16,468  $17,480  $18,636  $21,086  $20,196 
          
Allowance for lending related credit losses$139,034  $127,688  $129,834  $133,793  $129,679 
          
Provision for Credit Losses         
Provision (benefit) for credit losses-loans$12,750  $2,672  $7,829  $2,184  $2,075 
Provision for credit losses-unfunded commitments (1,012)  (1,156)  (2,450)  890   1,312 
Total provision (benefit) for credit losses$11,738  $1,516  $5,379  $3,074  $3,387 
          
Asset Quality         
Nonaccrual loans$95,426  $51,304  $61,956  $58,066  $58,231 
Loans past due ninety days or more 2,507   511   1,459   174   273 
Other real estate owned 12,548   14,362   2,677   7,438   8,401 
Other repossessed assets    1   5   24   26 
Total nonperforming assets$110,481  $66,178  $66,097  $65,702  $66,931 
          
Nonperforming Assets Activity         
Balance, beginning of period$66,178  $66,097  $65,702  $66,931  $73,268 
Net loan (charge offs) recoveries (392)  (3,662)  (9,338)  1,040   1,693 
New nonperforming loans 61,193   19,295   19,805   4,626   1,439 
Reduction of nonperforming loans(1) (14,278)  (14,691)  (5,253)  (5,711)  (8,875)
OREO/Repossessed assets sales proceeds (2,220)  (861)  (4,819)  (1,184)  (594)
Balance, end of period$110,481  $66,178  $66,097  $65,702  $66,931 
          
Asset Quality Ratios         
Ratio of nonperforming loans to total loans 0.81%  0.44%  0.54%  0.51%  0.51%
Ratio of nonperforming assets to total assets 0.57   0.33   0.33   0.33   0.33 
Annualized ratio of net loan charge-offs (recoveries) to average loans 0.01   0.12   0.32   (0.04)  (0.06)
Allowance for loan credit losses as a percent of loans 1.02   0.93   0.95   0.98   0.96 
Allowance for lending related credit losses as a percent of loans 1.15   1.08   1.11   1.16   1.13 
Allowance for loan credit losses as a percent of nonperforming loans 125.15   212.70   175.35   193.52   187.14 
Loans delinquent 30-89 days as a percent of total loans 0.09   0.12   0.12   0.10   0.04 
          
(1) Includes principal reductions, transfers to performing status and transfers to OREO.
 


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS
 For the Quarter Ended
 December 31, 2023 September 30, 2023 December 31, 2022
 Average
Balance
 Interest Rate Average
Balance
 Interest Rate Average
Balance
 Interest Rate
Earning Assets                 
Securities:                 
Taxable$5,119,970  $54,573 4.23% $5,726,057  $54,800 3.80% $6,122,313  $53,178 3.45%
Nontaxable(1) 759,464   7,681 4.01   881,162   8,085 3.64   890,368   7,762 3.46 
Total securities 5,879,434   62,254 4.20   6,607,219   62,885 3.78   7,012,681   60,940 3.45 
Interest on deposits with other banks and other short-term investments 146,027   2,174 5.91   142,301   1,651 4.60   151,405   1,410 3.69 
Federal funds sold        152   3 7.83   739   11 5.91 
Loans:(2)                 
Commercial and industrial(1) 3,624,034   66,980 7.33   3,610,677   63,001 6.92   3,346,843   45,290 5.37 
PPP loans 3,064   8 1.04   3,948   11 1.11   12,252   397 12.86 
Owner occupied commercial real estate 2,436,234   31,714 5.16   2,412,501   30,127 4.95   2,277,055   26,194 4.56 
Non-owner occupied commercial real estate 2,688,805   42,417 6.26   2,586,011   38,779 5.95   2,286,298   29,273 5.08 
Real estate construction 1,035,010   20,200 7.74   1,027,544   19,448 7.51   1,050,802   16,585 6.26 
Agricultural and agricultural real estate 844,353   13,069 6.14   822,957   12,582 6.07   785,647   10,159 5.13 
Residential mortgage 810,069   9,531 4.67   827,402   9,482 4.55   858,767   9,168 4.24 
Consumer 496,703   9,597 7.67   509,024   9,615 7.49   499,849   7,426 5.89 
Less: allowance for credit losses-loans (109,776)      (110,726)      (106,500)    
Net loans 11,828,496   193,516 6.49   11,689,338   183,045 6.21   11,011,013   144,492 5.21 
Total earning assets 17,853,957   257,944 5.73%  18,439,010   247,584 5.33%  18,175,838   206,853 4.52%
Nonearning Assets 1,813,868       1,768,910       1,738,011     
Total Assets$19,667,825      $20,207,920      $19,913,849     
Interest-bearing Liabilities                 
Savings$8,782,197  $53,807 2.43% $8,737,581  $49,195 2.23% $9,987,692  $25,950 1.03%
Time deposits 3,165,788   34,264 4.29   3,945,371   43,549 4.38   1,322,094   6,265 1.88 
Borrowings 401,463   5,874 5.80   103,567   1,167 4.47   298,804   2,223 2.95 
Term debt 372,232   5,804 6.19   372,112   5,765 6.15   371,442   5,043 5.39 
Total interest-bearing liabilities 12,721,680   99,749 3.11%  13,158,631   99,676 3.01%  11,980,032   39,481 1.31%
Noninterest-bearing Liabilities                 
Noninterest-bearing deposits 4,761,409       4,824,861       6,009,432     
Accrued interest and other liabilities 344,945       366,905       264,941     
Total noninterest-bearing liabilities 5,106,354       5,191,766       6,274,373     
Equity 1,839,791       1,857,523       1,659,444     
Total Liabilities and Equity$19,667,825      $20,207,920      $19,913,849     
Net interest income, fully tax-equivalent (non-GAAP)(1)(3)  $158,195     $147,908     $167,372  
Net interest spread(1)    2.62%     2.32%     3.21%
Net interest income, fully tax-equivalent (non-GAAP) to total earning assets(1)(3)    3.52%     3.18%     3.65%
Interest-bearing liabilities to earning assets 71.25%      71.36%      65.91%    
 
(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.
(2) Nonaccrual loans and loans held for sale are included in the average loans outstanding.
(3) Refer to "Non-GAAP Measures" in this earnings release for additional information on the usage and presentation of these non-GAAP measures, and refer to these financial tables for the reconciliations to the most directly comparable GAAP measures.
 


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS
 For the Year Ended
 December 31, 2023 December 31, 2022
 Average
Balance
 Interest Rate Average
Balance
 Interest Rate
Earning Assets           
Securities:           
Taxable$5,723,603  $223,521 3.91% $6,335,586  $169,544 2.68%
Nontaxable(1) 864,288   31,292 3.62   965,474   30,387 3.15 
Total securities 6,587,891   254,813 3.87   7,301,060   199,931 2.74 
Interest-bearing deposits with other banks and other short-term investments 136,964   7,007 5.12   216,786   3,125 1.44 
Federal funds sold 38   3 7.89   192   11 5.73 
Loans:(2)           
Commercial and industrial(1) 3,566,610   236,532 6.63   3,070,890   140,310 4.57 
PPP loans 5,797   69 1.19   50,464   6,884 13.64 
Owner occupied commercial real estate 2,375,883   116,641 4.91   2,272,088   93,936 4.13 
Non-owner occupied commercial real estate 2,517,645   147,528 5.86   2,196,922   99,202 4.52 
Real estate construction 1,047,192   76,307 7.29   923,316   48,258 5.23 
Agricultural and agricultural real estate 837,861   49,260 5.88   778,526   34,064 4.38 
Residential mortgage 832,562   37,669 4.52   852,541   34,276 4.02 
Consumer 503,763   36,522 7.25   464,084   23,058 4.97 
Less: allowance for credit losses-loans (111,016)      (105,735)    
Net loans 11,576,297   700,528 6.05   10,503,096   479,988 4.57 
Total earning assets 18,301,190   962,351 5.26%  18,021,134   683,055 3.79%
Nonearning Assets 1,751,814       1,600,705     
Total Assets$20,053,004      $19,621,839     
Interest-bearing Liabilities           
Savings$9,043,067  $182,179 2.01% $9,737,100  $46,623 0.48%
Time deposits 3,299,405   137,509 4.17   1,160,538   10,257 0.88 
Borrowings 204,524   10,311 5.04   168,404   2,717 1.61 
Term debt 372,129   22,560 6.06   371,879   16,823 4.52 
Total interest-bearing liabilities 12,919,125   352,559 2.73%  11,437,921   76,420 0.67%
Noninterest-bearing Liabilities           
Noninterest-bearing deposits 5,008,822       6,131,760     
Accrued interest and other liabilities 299,369       203,412     
Total noninterest-bearing liabilities 5,308,191       6,335,172     
Equity 1,825,688       1,848,746     
Total Liabilities and Equity$20,053,004      $19,621,839     
Net interest income, fully tax-equivalent (non-GAAP)(1)(3)  $609,792     $606,635  
Net interest spread(1)    2.53%     3.12%
Net interest income, fully tax-equivalent (non-GAAP) to total earning assets(1)(3)    3.33%     3.37%
Interest-bearing liabilities to earning assets 70.59%      63.47%    
            
(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.
(2) Nonaccrual loans and loans held for sale are included in the average loans outstanding.
(3) Refer to "Non-GAAP Measures" in this earnings release for additional information on the usage and presentation of these non-GAAP measures, and refer to these financial tables for the reconciliations to the most directly comparable GAAP measures.
 


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 For the Quarter Ended
 12/31/2023 9/30/2023 6/30/2023 3/31/2023 12/31/2022
Reconciliation of Annualized Return on Average Tangible Common Equity (non-GAAP)         
Earnings available to common stockholders (GAAP)$(72,375) $46,078  $47,404  $50,763  $58,642 
Plus core deposit and customer relationship intangibles amortization, net of tax(2) 1,229   1,240   1,309   1,364   1,410 
Earnings available to common stockholders excluding intangible amortization (non-GAAP)$(71,146) $47,318  $48,713  $52,127  $60,052 
          
Average common equity (GAAP)$1,729,086  $1,746,818  $1,727,013  $1,655,860  $1,548,739 
Less average goodwill 576,005   576,005   576,005   576,005   576,005 
Less average core deposit and customer relationship intangibles, net 19,193   20,821   22,481   24,238   26,046 
Average tangible common equity (non-GAAP)$1,133,888  $1,149,992  $1,128,527  $1,055,617  $946,688 
Annualized return on average common equity (GAAP)(16.61)%  10.47%  11.01%  12.43%  15.02%
Annualized return on average tangible common equity (non-GAAP)(24.89)%  16.32%  17.31%  20.03%  25.17%
          
Reconciliation of Annualized Net Interest Margin, Fully Tax-Equivalent (non-GAAP)         
Net Interest Income (GAAP)$156,137  $145,756  $147,132  $152,212  $165,220 
Plus tax-equivalent adjustment(1) 2,058   2,152   2,136   2,209   2,152 
Net interest income, fully tax-equivalent (non-GAAP)$158,195  $147,908  $149,268  $154,421  $167,372 
          
Average earning assets$17,853,957  $18,439,010  $18,523,552  $18,392,649  $18,175,838 
          
Annualized net interest margin (GAAP) 3.47%  3.14%  3.19%  3.36%  3.61%
Annualized net interest margin, fully tax-equivalent (non-GAAP) 3.52   3.18   3.23   3.40   3.65 
Net purchase accounting discount amortization on loans included in annualized net interest margin 0.02   0.01   0.03   0.02   0.03 
          
Reconciliation of Tangible Book Value Per Common Share (non-GAAP)         
Common equity (GAAP)$1,822,412  $1,714,825  $1,748,285  $1,718,700  $1,624,350 
Less goodwill 576,005   576,005   576,005   576,005   576,005 
Less core deposit and customer relationship intangibles, net 18,415   20,026   21,651   23,366   25,154 
Tangible common equity (non-GAAP)$1,227,992  $1,118,794  $1,150,629  $1,119,329  $1,023,191 
          
Common shares outstanding, net of treasury stock 42,688,008   42,656,303   42,644,544   42,558,726   42,467,394 
Common equity (book value) per share (GAAP)$42.69  $40.20  $41.00  $40.38  $38.25 
Tangible book value per common share (non-GAAP)$28.77  $26.23  $26.98  $26.30  $24.09 
          
Reconciliation of Tangible Common Equity Ratio (non-GAAP)         
Tangible common equity (non-GAAP)$1,227,992  $1,118,794  $1,150,629  $1,119,329  $1,023,191 
          
Total assets (GAAP)$19,411,707  $20,129,793  $20,224,716  $20,182,544  $20,244,228 
Less goodwill 576,005   576,005   576,005   576,005   576,005 
Less core deposit and customer relationship intangibles, net 18,415   20,026   21,651   23,366   25,154 
Total tangible assets (non-GAAP)$18,817,287  $19,533,762  $19,627,060  $19,583,173  $19,643,069 
Tangible common equity ratio (non-GAAP) 6.53%  5.73%  5.86%  5.72%  5.21%
          
(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.
(2) Tax effect is calculated based on the respective periods’ year-to-date effective tax rate excluding the impact of discrete items.
 


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 For the Quarter Ended
12/31/2023 9/30/2023 6/30/2023 3/31/2023 12/31/2022
Reconciliation of Adjusted Efficiency Ratio, fully tax-equivalent (non-GAAP) 
Net interest income (GAAP)$156,137  $145,756  $147,132  $152,212  $165,220 
Tax-equivalent adjustment(1) 2,058   2,152   2,136   2,209   2,152 
Fully tax-equivalent net interest income 158,195   147,908   149,268   154,421   167,372 
Noninterest income (111,801)  28,383   32,493   29,999   29,975 
Securities (gains)/losses, net 140,007   114   314   1,104   153 
Unrealized (gain) loss on equity securities, net (75)  (13)  41   (193)  7 
Valuation adjustment on servicing rights              
Adjusted revenue (non-GAAP)$186,326  $176,392  $182,116  $185,331  $197,507 
          
Total noninterest expenses (GAAP)$130,285  $111,053  $109,446  $111,043  $117,218 
Less:         
Core deposit and customer relationship intangibles amortization 1,611   1,625   1,715   1,788   1,841 
Partnership investment in tax credit projects 3,573   1,136   154   538   3,247 
(Gain) loss on sales/valuation of assets, net 2,072   108   (3,372)  1,115   2,388 
Acquisition, integration and restructuring costs 4,365   2,429   1,892   1,673   2,442 
FDIC special assessment 8,145             
Core expenses (non-GAAP)$110,519  $105,755  $109,057  $105,929  $107,300 
          
Efficiency ratio (GAAP) 293.86%  63.77%  60.93%  60.94%  60.05%
Adjusted efficiency ratio, fully tax-equivalent (non-GAAP) 59.31%  59.95%  59.88%  57.16%  54.33%
          
Reconciliation of Annualized Ratio of Core Expenses to Average Assets (non-GAAP)         
Total noninterest expenses (GAAP)$130,285  $111,053  $109,446  $111,043  $117,218 
Core expenses (non-GAAP) 110,519   105,755   109,057   105,929   107,300 
          
Average assets$19,667,825  $20,207,920  $20,221,511  $20,118,005  $19,913,849 
Total noninterest expenses to average assets (GAAP) 2.63%  2.18%  2.17%  2.24%  2.34%
Core expenses to average assets (non-GAAP) 2.23%  2.08%  2.16%  2.14%  2.14%
          
Acquisition, integration and restructuring costs         
Salaries and employee benefits$1,425  $94  $93  $74  $424 
Occupancy 1,092             
Furniture and equipment 19             
Professional fees 793   1,617   1,068   934   1,587 
Advertising 28   178   222   122   95 
Other noninterest expenses 1,008   540   509   543   336 
Total acquisition, integration and restructuring costs$4,365  $2,429  $1,892  $1,673  $2,442 
          
(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.
(2) Tax effect is calculated based on the respective periods’ year-to-date effective tax rate excluding the impact of discrete items.
 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 For the Quarter Ended
 12/31/2023 9/30/2023 6/30/2023 3/31/2023 12/31/2022
Reconciliation of Adjusted Earnings         
Net income/(loss)$(70,363) $48,091  $49,416  $52,776  $60,654 
Loss from sale of securities 140,007   114   314   1,104   153 
(Gain) loss on sales/valuation of assets, net 2,072   108   (3,372)  1,115   2,388 
Acquisition, integration and restructuring costs 4,365   2,429   1,892   1,673   2,442 
FDIC special assessment 8,145             
Total adjustments 154,589   2,651   (1,166)  3,892   4,983 
Tax effect of adjustments(2) (36,638)  (628)  276   (922)  (1,166)
Adjusted earnings$47,588  $50,114  $48,526  $55,746  $64,471 
          
Preferred dividends (2,012)  (2,013)  (2,012)  (2,013)  (2,012)
Adjusted earnings available to common stockholders$45,576  $48,101  $46,514  $53,733  $62,459 
          
Plus core deposit and customer relationship intangibles amortization, net of tax(2) 1,229   1,240   1,309   1,364   1,410 
Earnings available to common stockholders excluding intangible amortization (non-GAAP)$46,805  $49,341  $47,823  $55,097  $63,869 
          
          
Reconciliation of Adjusted Annualized Return on Average Assets 
Average assets$19,667,825  $20,207,920  $20,221,511  $20,118,005  $19,913,849 
Adjusted annualized return on average assets (non-GAAP) 0.96%  0.98%  0.96%  1.12%  1.28%
          
Reconciliation of Adjusted Annualized Return on Average Common Equity         
Average common stockholders' equity (GAAP)$1,729,086  $1,746,818  $1,727,013  $1,655,860  $1,548,739 
Adjusted annualized average common equity (non-GAAP) 10.46%  10.92%  10.80%  13.16%  16.00%
          
Reconciliation of Adjusted Annualized Return on Average Tangible Common Equity         
Average tangible common equity (non-GAAP)$1,133,888  $1,149,992  $1,128,527  $1,055,617  $946,688 
Adjusted annualized average tangible common equity (non-GAAP) 16.38%  17.02%  17.00%  21.17%  26.77%
          
Reconciliation of Adjusted Diluted Earnings Per Common Share         
Weighted average shares outstanding-diluted 42,838,405   42,812,563   42,757,603   42,742,878   42,699,752 
Adjusted diluted earnings per common share$1.06  $1.12  $1.09  $1.26  $1.46 
          
(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.
(2) Tax effect is calculated based on the respective periods’ year-to-date effective tax rate excluding the impact of discrete items.
 


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 For the Quarter Ended
December 31,
 For the Year Ended
December 31,
 2023 2022 2023 2022
Reconciliation of Annualized Return on Average Tangible Common Equity (non-GAAP)       
Earnings available to common stockholders (GAAP)$(72,375) $58,642  $71,870  $204,130 
Plus core deposit and customer relationship intangibles amortization, net of tax(2) 1,229   1,410   5,142   6,071 
Earnings available to common stockholders excluding intangible amortization (non-GAAP)$(71,146) $60,052  $77,012  $210,201 
        
Average common equity (GAAP)$1,729,086  $1,548,739  $1,714,983  $1,738,041 
Less average goodwill 576,005   576,005   576,005   576,005 
Less average core deposit and customer relationship intangibles, net 19,193   26,046   21,667   28,912 
Average tangible common equity (non-GAAP)$1,133,888  $946,688  $1,117,311  $1,133,124 
Annualized return on average common equity (GAAP)(16.61)%  15.02%  4.19%  11.74%
Annualized return on average tangible common equity (non-GAAP)(24.89)%  25.17%  6.89%  18.55%
        
Reconciliation of Annualized Net Interest Margin, Fully Tax-Equivalent (non-GAAP)       
Net Interest Income (GAAP)$156,137  $165,220  $601,237  $598,236 
Plus tax-equivalent adjustment(1) 2,058   2,152   8,555   8,399 
Net interest income, fully tax-equivalent (non-GAAP)$158,195  $167,372  $609,792  $606,635 
        
Average earning assets$17,853,957  $18,175,838  $18,301,190  $18,021,134 
        
Annualized net interest margin (GAAP) 3.47%  3.61%  3.29%  3.32%
Annualized net interest margin, fully tax-equivalent (non-GAAP) 3.52   3.65   3.33   3.37 
Net purchase accounting discount amortization on loans included in annualized net interest margin 0.02   0.03   0.02   0.04 
        
(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.
(2) Tax effect is calculated based on the respective periods’ year-to-date effective tax rate excluding the impact of discrete items.
 


 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 For the Quarter Ended
December 31,
 For the Year Ended
December 31,
 2023 2022 2023 2022
Reconciliation of Efficiency Ratio (non-GAAP)       
Net interest income (GAAP)$156,137  $165,220  $601,237  $598,236 
Tax-equivalent adjustment(1) 2,058   2,152   8,555   8,399 
Fully tax-equivalent net interest income 158,195   167,372   609,792   606,635 
Noninterest income (111,801)  29,975   (20,926)  128,264 
Securities (gains)/losses, net 140,007   153   141,539   425 
Unrealized (gain) loss on equity securities, net (75)  7   (240)  622 
Valuation adjustment on servicing rights          (1,658)
Adjusted revenue (non-GAAP)$186,326  $197,507  $730,165  $734,288 
        
Total noninterest expenses (GAAP)$130,285  $117,218  $461,827  $443,377 
Less:       
Core deposit and customer relationship intangibles amortization 1,611   1,841   6,739   7,834 
Partnership investment in tax credit projects 3,573   3,247   5,401   5,040 
(Gain) loss on sales/valuations of assets, net 2,072   2,388   (77)  (1,047)
Acquisition, integration and restructuring costs 4,365   2,442   10,359   7,586 
FDIC special assessment 8,145      8,145    
Core expenses (non-GAAP)$110,519  $107,300  $431,260  $423,964 
Efficiency ratio (GAAP) 293.86%  60.05%  79.58%  61.03%
Adjusted efficiency ratio, fully tax-equivalent (non-GAAP) 59.31%  54.33%  59.06%  57.74%
        
Reconciliation of Annualized Ratio of Core Expenses to Average Assets (non-GAAP)       
Total noninterest expenses (GAAP)$130,285  $117,218  $461,827  $443,377 
Core expenses (non-GAAP) 110,519   107,300   431,260   423,964 
        
Average assets$19,667,825  $19,913,849  $20,053,004  $19,621,839 
Total noninterest expenses to average assets (GAAP) 2.63%  2.34%  2.30%  2.26%
Core expenses to average assets (non-GAAP) 2.23%  2.14%  2.15%  2.16%
        
Acquisition, integration and restructuring costs       
Salaries and employee benefits$1,425  $424  $1,686  $1,404 
Occupancy 1,092      1,092    
Furniture and equipment 19      19    
Professional fees 793   1,587   4,412   5,082 
Advertising 28   95   550   382 
Other noninterest expenses 1,008   336   2,600   718 
Total acquisition, integration and restructuring costs$4,365  $2,442  $10,359  $7,586 
        
(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.
 
HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
 For the Quarter Ended
December 31,
 For the Year Ended
December 31,
 2023 2022 2023 2022
Reconciliation of Adjusted Earnings (non-GAAP)       
Net income/(loss)$(70,363) $60,654  $79,920  $212,180 
Loss from sale of securities 140,007   153   141,539   425 
(Gain) loss on sales/valuation of assets, net 2,072   2,388   (77)  (1,047)
Acquisition, integration and restructuring costs 4,365   2,442   10,359   7,586 
FDIC special assessment 8,145      8,145    
Total adjustments 154,589   4,983   159,966   6,964 
Tax effect of adjustments(2) (36,638)  (1,166)  (37,912)  (1,567)
Adjusted earnings$47,588  $64,471  $201,974  $217,577 
        
Preferred dividends (2,012)  (2,012)  (8,050)  (8,050)
Adjusted earnings available to common stockholders$45,576  $62,459  $193,924  $209,527 
        
Plus core deposit and customer relationship intangibles amortization, net of tax(2) 1,229   1,410   5,142   6,071 
Earnings available to common stockholders excluding intangible amortization (non-GAAP)$46,805  $63,869  $199,066  $215,598 
        
        
Reconciliation of Adjusted Annualized Return on Average Assets       
Average assets$19,667,825  $19,913,849  $20,053,004  $19,621,839 
Adjusted annualized return on average assets (non-GAAP) 0.96%  1.28%  1.01%  1.11%
        
Reconciliation of Adjusted Annualized Return on Average Common Equity       
Average common stockholders' equity (GAAP)$1,729,086  $1,548,739  $1,714,983  $1,738,041 
Adjusted annualized average common equity (non-GAAP) 10.46%  16.00%  11.31%  12.06%
        
Reconciliation of Adjusted Annualized Return on Average Tangible Common Equity       
Average tangible common equity (non-GAAP)$1,133,888  $946,688  $1,117,311  $1,133,124 
Adjusted annualized average tangible common equity (non-GAAP) 16.38%  26.77%  17.82%  19.03%
        
Reconciliation of Adjusted Diluted Earnings Per Common Share       
Weighted average shares outstanding-diluted 42,838,405   42,699,752   42,791,795   42,630,703 
Adjusted diluted earnings per common share$1.06  $1.46  $4.53  $4.91 
        
(2) Tax effect is calculated based on the respective periods’ year-to-date effective tax rate excluding the impact of discrete items.
 


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