Market Newsdesk

April 20, 2022 5:00 pm

Eagle Bancorp, Inc. Announces Net Income for First Quarter 2022 of $45.7 Million or $1.42 Per Diluted Share

BETHESDA, Md., April 20, 2022 (GLOBE NEWSWIRE) — Eagle Bancorp, Inc. (the “Company”) (NASDAQ: EGBN), the parent company of EagleBank (the “Bank”), today announced net income of $45.7 million for the first quarter 2022 compared to net income of $41.6 million for the prior quarter and $43.5 million for the year-ago quarter. Net income was $1.43 per share (basic) and $1.42 per share (diluted) for the first quarter 2022, compared to basic and diluted shares of $1.30 per share for the prior quarter and $1.36 per share for the year-ago quarter.

The increase in earnings of $4.1 million from the prior quarter was primarily driven by a decrease in non-interest expense from an accrual reduction of $5.0 million related to share-based compensation awards and deferred compensation to our former CEO and Chairman. The increase to earnings from this accrual reduction was partially offset by (in comparison to the prior quarter) a smaller reversal of the provision for credit losses on loans and a decline in noninterest income.

First Quarter 2022 Highlights

Loans increased by $48.2 million from the prior quarter-end. This was the second consecutive quarterly increase.
There was a reversal of $2.8 million from the provision for credit losses on loans. This was the fifth consecutive quarterly reversal.
Salaries and employee benefits decreased $7.6 million from the prior quarter, primarily due to an accrual reduction of $5.0 million related to share-based compensation awards and deferred compensation associated with our former CEO and Chairman.
During the quarter, $1.1 billion of securities designated as available-for-sale (“AFS”) were transferred to held-to-maturity (“HTM”), net of $66 million of unrealized losses, and a portion of securities purchased during the quarter were designated as securities HTM. At quarter-end, $1.2 billion, or 39.3% of the securities portfolio, was classified as securities HTM.
The increase in the overall interest rate environment created unrealized losses in securities AFS that are recorded in accumulated other comprehensive income. As a result, shareholders’ equity, book value per share and tangible book value per share declined from the prior quarter-end.

(Dollars in thousands, except per share)	As of or for the Three Months Ended									Percent Change
	March 31,			December 31,			March 31,			Q1-22		Q1-22
	2022			2021			2021			vs. Q4 21		vs. Q1 21
Income Statement
Net income	$	45,744		$	41,620		$	43,469		9.9	%	5.2	%
Net income per diluted share	$	1.42		$	1.30		$	1.36		9.2	%	4.4	%

Return on Average Assets		1.46	%		1.32	%		1.53	%
Return on Average Common Equity		13.83	%		12.30	%		14.05	%
Return on Average Tangible Common Equity¹		14.99	%		13.35	%		15.33	%
Net interest margin		2.65	%		2.55	%		2.98	%
Efficiency Ratio¹		35.28	%		44.29	%		40.74	%

Balance Sheet
Assets	$	11,212,943		$	11,847,310		$	11,127,864		(5.4	)%	0.8	%
Loans		7,113,807			7,065,598			7,526,689		0.7	%	(5.5	)%
Loans (excluding PPP loans)²		7,078,063			7,014,493			6,961,671		0.9	%	1.7	%
Deposits		9,586,259			9,981,540			9,198,844		(4.0	)%	4.2	%
Total Capital (to risk weighted assets)		15.72	%		16.15	%		17.86	%

Per Share
Book value per share	$	39.44		$	42.28		$	39.45		(6.7	)%	—	%
Tangible book value per share	$	36.19		$	38.97		$	36.16		(7.1	)%	0.1	%

Asset quality
Allowance for credit losses to total loans		1.01	%		1.06	%		1.36	%
Nonperforming assets (“NPAs”) to total assets		0.23	%		0.26	%		0.51	%
Net charge-off ratio to avg. loans (annualized)		0.03	%		0.07	%		0.27	%

CEO Commentary

Susan G. Riel, President and Chief Executive Officer of Eagle Bancorp, Inc. commented, “The results for the first quarter represent a continuation of our strong performance from last year. Loan balances increased for a second consecutive quarter and asset quality metrics continue to improve.”

“This quarter’s loan growth was driven by growth from our CRE and C&I lending teams. We were also successful in migrating many of our construction loans into income producing CRE as projects were completed.”

“Even with the completion of construction projects, our pipeline remains strong as unfunded commitments were up slightly to $2.1 billion at quarter-end. As more opportunities arise, our total risk-based capital of 15.72%, gives us ample room to continue to grow the loan portfolio.”

“For our shareholders, we remain focused on increasing value and returning cash through dividends. At the end of the quarter, our board declared a dividend of $0.40 per share, which is a payout ratio of 28% based on first quarter earnings.”

“We once again thank all of our employees for their commitment in serving the needs of our clients and communities. Additionally, we remain committed to a culture of respect, diversity and inclusion in both the workplace and the communities we serve.”

Income Statement

Net interest income was $80.5 million for the first quarter 2022, compared to $78.2 million for the prior quarter and $82.7 million for the year-ago quarter. The increase in net interest income from the prior quarter was driven by the deployment of excess liquidity into investment securities, partially offset by lower interest and fees on loans.
Net interest margin was 2.65% for the first quarter 2022, compared to 2.55% for the prior quarter and 2.98% for the year-ago quarter. The increase in margin from the prior quarter was primarily attributable to an increase in the investment of excess liquidity into higher earning assets, including securities. Average securities (both securities AFS and securities HTM) were $730 million higher than in the prior quarter.
- The yield on the loan portfolio was 4.35% for the first quarter 2022, compared to 4.45% for the prior quarter and 4.65% for the year-ago quarter. Loan yields were down 10 basis points from the prior quarter as higher yielding loans continued to be replaced by lower yielding loans, and the impact of rising rates on existing adjustable rate loans and new loans occurred later in the first quarter.
- The cost of funds was 0.26% for first quarter 2022, compared to 0.26% for the prior quarter and 0.42% for the year-ago quarter. While it did not have much of an impact on the first quarter of 2022, in the last half of March, rates on most interest bearing demand deposit accounts were increased by 5 basis points and a Federal Home Loan Bank (“FHLB”) advance of $150 million was repaid.
Pre-provision net revenue (“PPNR”),³ a non-GAAP measure, was $56.9 million for the first quarter 2022, compared to $49.5 million for the prior quarter and $55.3 million for the year-ago quarter. As a percent of average assets, adjusted PPNR for the first quarter 2022 was 1.79%, compared to 1.56% for the prior quarter and 1.95% for the year-ago quarter. This increase in PPNR as a percent of average assets from the prior quarter was primarily attributable to lower noninterest expense driving the larger 15.0% increase in PPNR over the smaller 1.3% increase in average assets.

(Dollars in thousands)	Three Months Ended									Percent Change
	March 31,			December 31,			March 31,			Q1-22		Q1-22
	2022			2021			2021			vs. Q4 21		vs. Q1 21
Net interest income	$	80,452		$	78,186		$	82,651		2.9	%	(2.7	)%
Noninterest income		7,453			10,574			10,587		(29.5	)%	(29.6	)%
Less: Noninterest expense		(31,012	)		(39,309	)		(37,987	)	(21.1	)%	(18.4	)%
PPNR	$	56,893		$	49,451		$	55,251		15.0	%	3.0	%

Average Assets	$	12,700,993		$	12,538,596		$	11,517,836		1.3	%	10.3	%
PPNR to Avg. Assets (non-GAAP)		1.79	%		1.56	%		1.95	%

Provision for credit losses on loans was a reversal of $2.8 million for the first quarter 2022, compared to a reversal of $6.4 million for the prior quarter and a reversal of $2.4 million for the year-ago quarter. The first quarter 2022 reversal was primarily driven by improvements in the economic environment, and related adjustments to the quantitative components of the CECL model, in particular the lower modeled probability of default, as well as improvements in asset quality.
Noninterest income was $7.5 million for the first quarter 2022, as compared to $10.6 million for the prior quarter and $10.6 million for the year-ago quarter. The decline in noninterest income from the prior quarter was primarily due to decreases in Federal Housing Administration (“FHA”) multifamily income, lower gain on sale of investment securities and lower gain on sale of residential mortgage loans.

Residential mortgage loan locked commitments were $136.7 million, down from $163.0 million the prior quarter and down from $303.3 million for the year-ago quarter. As interest rates rose in the first quarter, the refinance activity slowed resulting in fewer locked loans.
Noninterest expense was $31.0 million for the first quarter 2022 compared to $39.3 million for the prior quarter and $38.0 million for the year-ago quarter. The major changes from the prior quarter were as follows:
- Salaries and employee benefits were $17.0 million, down $7.6 million from the prior quarter. The decrease was primarily due to the reduction of the $5.0 million accrual related to share-based compensation awards and deferred compensation for our former CEO and Chairman in the first quarter of 2022, because we believe any compensation related claims are now time barred under Maryland law. The accrual was originally recorded in the first quarter of 2019. Absent the accrual reduction, salaries and employee benefits were down $2.6 million⁴ from the prior quarter, primarily on lower incentive bonus accruals offset by increases in share based compensation and payroll taxes.
- Legal, accounting and professional fees were $1.6 million, down $1.4 million from the prior quarter.

Efficiency ratio
⁵ was 35.3% for the first quarter 2022 compared to 44.3% for the prior quarter and 40.7% for the year-ago quarter. The improvement in the efficiency ratio from the prior quarter was primarily driven by the decrease in noninterest expense (see noninterest expense section above).
Effective income tax rate for the first quarter 2022 was 23.4%, compared to 26.3% for the prior quarter and 25.1% for the year-ago quarter. The reduction in the effective tax rate from the prior quarter was attributable to the decrease in noninterest expense related to the accrual reduction discussed above in noninterest expenses. This accrual was not tax deductible when recorded, conversely there was no negative tax impact when the accrual was reduced.

Balance Sheet

Total assets at March 31, 2022 were $11.2 billion, down 5.4% from a quarter ago and up 0.8% from a year ago. The decrease from the prior quarter-end was driven by the utilization of interest-bearing deposits with banks and other short-term investments to satisfy deposit outflows and the repayment of a $150 million FHLB advance.
Investment securities (AFS and HTM) had a balance of $2.9 billion at March 31, 2022, up 11.6% from a quarter ago and up 113.9% from a year ago. The increase from the prior quarter-end was primarily due to more excess liquidity being invested in higher earning assets in response to higher rates on investments available in the market during the quarter. Investments at quarter-end were $306 million higher than that of the prior quarter-end, and investments made during the first quarter of 2022 were primarily agency mortgage backed securities and agency bonds.

At quarter-end, securities HTM were $1.2 billion of investment securities (AFS and HTM). The transfer of securities from AFS to HTM and purchases of securities designated as HTM during the quarter will reduce the impact of changes in interest rates on capital and tangible capital.
Total loans (excluding loans held for sale) were $7.1 billion as of March 31, 2022, up 0.7% from a quarter ago and down 5.5% from a year ago. Excluding PPP loans, loan balances were $7.1 billion as of March 31, 2022, up 0.9% from a quarter ago and up 1.7% from a year ago.⁶ The increase in loans, excluding PPP loans, from the prior quarter-end was driven by growth from commercial real estate (“CRE”) loans and commercial & industrial loans (“C&I”).

										Percent Change
(Dollars in thousands)	March 31,			December 31,			March 31,			Q1-22		Q1-22
	2022			2021			2021			vs. Q4 21		vs. Q1 21
Total loans, excluding loans held for sale (GAAP)	$	7,113,807		$	7,065,598		$	7,526,689		0.7	%	(5.5	)%
Less: PPP loans (non-GAAP)		(35,744	)		(51,105	)		(565,018	)
Total loans, excluding loans held for sale and PPP loans (non-GAAP)	$	7,078,063		$	7,014,493		$	6,961,671		0.9	%	1.7	%

Allowance for credit losses was 1.01% of total loans at March 31, 2022, compared to 1.06% a quarter ago, and 1.36% a year ago. The reduction in the allowance for credit losses as a percent of total loans from the prior quarter-end was primarily driven by the reversal of the allowance for credit losses.

Net charge-offs as a percent of average loans (excluding loans held for sale) (on an annualized basis), was 0.03% for the first quarter 2022, as compared to 0.07% a quarter ago, and 0.27% for the year-ago quarter. Net charge-offs for the quarter were $459 thousand.
Nonperforming loans and assets: Both nonperforming loans and assets decreased compared to the prior quarter and the year-ago quarter as there were no new nonaccrual loans or assets added since the prior quarter-end and several nonaccrual loans from the prior quarter-end became current, were charged-off or paid-down.
- Nonperforming loans as a percent of loans were 0.33% at March 31, 2022, compared to 0.41% a quarter ago and 0.69% a year ago.
- Nonperforming assets as a percent of assets were 0.23% at March 31, 2022, compared to 0.26% a quarter ago and 0.51% a year ago.

Total deposits were $9.6 billion at March 31, 2022, down 4.0% from a quarter ago and up 4.2% from a year ago. While deposits were down from prior quarter-end, average deposits for the quarter were up, and the deposit mix and cost of funds remains favorable.
- Average noninterest bearing deposits to average total deposits was 36.1% for the first quarter 2022, compared to 36.3% a quarter ago and 32.0% for the year-ago quarter.

Total shareholders’ equity was $1.3 billion at March 31, 2022, down 6.3% from a quarter ago, and up 0.4% from a year ago. The decrease in shareholders’ equity from the prior quarter-end was primarily as a result of the increase in the overall interest rate environment, which created unrealized losses in investment securities available for sale, that are recorded in accumulated other comprehensive income. These reductions to equity were partially offset by retained earnings.

These same factors, along with the issuance of shares from share-based compensation, reduced book value and tangible book value from the prior quarter-end:
- Book value per share was $39.44, down from $42.28 a quarter ago, and down from $39.45 a year ago.
- Tangible book value per share⁷ was $36.19, down from $38.97 a quarter ago, and up from $36.16 a year ago.

Dividends: On March 21, 2022, the Board of Directors declared a quarterly cash dividend of $0.40 per common share payable on April 29, 2022 to shareholders of record on April 11, 2022.
Capital ratios for the Company remain strong and substantially in excess of regulatory minimum requirements. Regulatory ratios based on risk-weighted assets declined from the prior quarter as non-risk weighted cash was moved into risk-weighted securities and loans. Common capital ratios declined as rising rates created unrealized losses on securities AFS which negatively impacted common equity and tangible common equity.

	For the Company
							Well
	March 31,		December 31,		March 31,		Capitalized
	2022		2021		2021		Minimum
Regulatory Ratios
Total Capital (to risk weighted assets)	15.72	%	16.15	%	17.86	%	10.00	%
Tier 1 Capital (to risk weighted assets)	14.60	%	15.02	%	14.42	%	8.00	%
Common Equity Tier 1 (to risk weighted assets)	14.60	%	15.02	%	14.42	%	6.50	%
Tier 1 Capital (to average assets)	9.82	%	10.19	%	10.28	%	5.00	%

Common Capital Ratios
Common Equity Ratio	11.28	%	11.40	%	11.33	%	—	%
Tangible Common Equity Ratio	10.45	%	10.60	%	10.48	%	—	%

Additional financial information: The financial information that follows provides more detail on the Company’s financial performance for the three months ended March 31, 2022 as compared to the three months ended December 31, 2021 and March 31, 2021 as well as eight quarters of trend data. Persons wishing additional information should refer to the Company’s annual report on Form 10-K for the year ended December 31, 2021, and other reports filed with the Securities and Exchange Commission (the “SEC”).

About Eagle Bancorp: The Company is the holding company for EagleBank, which commenced operations in 1998. The Bank is headquartered in Bethesda, Maryland, and operates through seventeen banking offices and five lending offices, located in Suburban Maryland, Washington, D.C. and Northern Virginia. The Company focuses on building relationships with businesses, professionals and individuals in its marketplace, and is committed to a culture of respect, diversity, equity and inclusion in both its workplace and the communities in which it operates.

Conference call: Eagle Bancorp will host a conference call to discuss its first quarter 2022 financial results on Thursday, April 21, 2022 at 10:00 a.m. eastern time. The public is invited to listen to this conference call by dialing 1.877.303.6220, conference ID Code: 3149886, or by accessing the call on the Company’s website, www.EagleBankCorp.com. A replay of the conference call will be available on the Company’s website through May 5, 2022.

Forward-looking statements: This press release contains forward-looking statements within the meaning of the Securities Exchange Act of 1934, as amended, including statements of goals, intentions, and expectations as to future trends, plans, events or results of Company operations and policies and regarding general economic conditions. In some cases, forward-looking statements can be identified by use of words such as “may,” “will,” “can,” “anticipates,” “believes,” “expects,” “plans,” “estimates,” “potential,” “continue,” “should,” “could,” “strive,” “feel” and similar words or phrases. These statements are based upon current and anticipated economic conditions, nationally and in the Company’s market (including the macroeconomic and other challenges and uncertainties resulting from the COVID-19 pandemic, including on our credit quality, asset and loan growth and broader business operations), interest rates and interest rate policy, competitive factors, and other conditions which by their nature, are not susceptible to accurate forecast and are subject to significant uncertainty. Because of these uncertainties and the assumptions on which this discussion and the forward-looking statements are based, actual future operations and results in the future may differ materially from those indicated herein. For details on factors that could affect these expectations, see the risk factors and other cautionary language included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021 and in other periodic and current reports filed with the SEC. Readers are cautioned against placing undue reliance on any such forward-looking statements. The Company’s past results are not necessarily indicative of future performance, and nothing contained herein is meant to or should be considered and treated as earnings guidance of future quarters’ performance projections. All information is as of the date of this press release. Any forward-looking statements made by or on behalf of the Company speak only as to the date they are made. Except to the extent required by applicable law or regulation, the Company undertakes no obligation to revise or update publicly any forward-looking statement for any reason.

__________________________________
¹ A reconciliation between this non-GAAP financial measure and the nearest GAAP measure is provided in the tables that accompany this document.
² A reconciliation between this non-GAAP financial measure and the nearest GAAP measure is provided in the table under the subsection, “Total Loans.”
³ A reconciliation between this non-GAAP financial measure and the nearest GAAP measure is provided in the table below. An explanation of the reconciliations and the reasons why the Company believes this non-GAAP financial measure to be important for investors is included with the reconciliation tables accompanying this document.
⁴ A reconciliation between this non-GAAP financial measure and the nearest GAAP measure is provided in the tables that accompany this document.
⁵ A reconciliation between this non-GAAP financial measure and the nearest GAAP measure is provided in the tables that accompany this document.
⁶ A reconciliation between this non-GAAP financial measure and the nearest GAAP measure is provided in the table below. An explanation of the reconciliations and the reasons why the Company believes this non-GAAP financial measure to be important for investors is included with the reconciliation tables accompanying this document.
⁷ A reconciliation of non-GAAP financial measures to the nearest GAAP measure is provided in the tables that accompany this document.


Eagle Bancorp, Inc.
Consolidated Financial Highlights (Unaudited)
(Dollars in thousands, except per share data)

	Three Months Ended
	March 31,			December 31,			March 31,
	2022			2021			2021
Income Statements:
Total interest income	$	88,321		$	86,230		$	94,194
Total interest expense		7,869			8,044			11,543
Net interest income		80,452			78,186			82,651
Provision (reversal) for credit losses		(2,787	)		(6,412	)		(2,350	)
Provision (reversal) for unfunded commitments		(11	)		(632	)		(442	)
Net interest income after provision for credit losses		83,250			85,230			85,443
Noninterest income (before investment gain)		7,478			9,668			10,366
Gain (loss) on sale of investment securities		(25	)		906			221
Total noninterest income		7,453			10,574			10,587
Total noninterest expense		31,012			39,309			37,987
Income before income tax expense		59,691			56,495			58,043
Income tax expense		13,947			14,875			14,574
Net income	$	45,744		$	41,620		$	43,469

Per Share Data:
Earnings per weighted average common share, basic	$	1.43		$	1.30		$	1.36
Earnings per weighted average common share, diluted	$	1.42		$	1.30		$	1.36
Weighted average common shares outstanding, basic		32,033,280			31,950,320			31,869,655
Weighted average common shares outstanding, diluted		32,110,099			32,030,998			31,922,940
Actual shares outstanding at period end		32,079,474			31,950,092			31,960,379
Book value per common share at period end	$	39.44		$	42.28		$	39.45
Tangible book value per common share at period end⁽¹⁾	$	36.19		$	38.97		$	36.16
Dividend per common share	$	0.40		$	0.40		$	0.25

Performance Ratios (annualized):
Return on average assets		1.46	%		1.32	%		1.53	%
Return on average common equity		13.83	%		12.30	%		14.05	%
Return on average tangible common equity⁽¹⁾		14.99	%		13.35	%		15.33	%
Net interest margin		2.65	%		2.55	%		2.98	%
Efficiency ratio⁽²⁾		35.28	%		44.29	%		40.74	%

Other Ratios:
Allowance for credit losses to total loans⁽³⁾		1.01	%		1.06	%		1.36	%
Allowance for credit losses to total nonperforming loans		301	%		257	%		195	%
Nonperforming loans to total loans⁽³⁾		0.33	%		0.41	%		0.69	%
Nonperforming assets to total assets		0.23	%		0.26	%		0.51	%
Net charge-offs (annualized) to average total loans⁽³⁾		0.03	%		0.07	%		0.27	%
Average noninterest bearing deposits to average deposits		36.1	%		36.3	%		32.0	%
Yield on loans⁽³⁾		4.35	%		4.45	%		4.65	%
Cost of funds		0.26	%		0.26	%		0.42	%


Eagle Bancorp, Inc.
Consolidated Financial Highlights (Continued) (Unaudited)
(Dollars in thousands)

	Three Months Ended
	March 31,			December 31,			March 31,
	2022			2021			2021
Capital Ratios
Common equity to total assets		11.28	%		11.40	%		11.33	%
Tier 1 capital (to average assets)		9.82	%		10.19	%		10.28	%
Total capital (to risk weighted assets)		15.72	%		16.15	%		17.86	%
Common equity tier 1 capital (to risk weighted assets)		14.60	%		15.02	%		14.42	%
Tangible common equity ratio⁽¹⁾		10.45	%		10.60	%		10.48	%

Loan Balances – Period End:
Commercial and Industrial	$	1,377,615		$	1,354,317		$	1,398,155
PPP loans	$	35,744		$	51,105		$	565,018
Commercial real estate – income producing	$	3,543,795		$	3,385,298		$	3,430,077
Commercial real estate – owner occupied	$	1,104,982		$	1,087,776		$	1,012,457
1-4 Family mortgage	$	72,238		$	73,966		$	71,209
Construction – commercial and residential	$	783,101		$	896,319		$	829,481
Construction – C&I (owner occupied)	$	140,282		$	159,579		$	152,240
Home equity	$	54,804		$	55,811		$	67,167
Other consumer	$	1,246		$	1,427		$	885

Average Balances:
Total assets	$	12,700,993		$	12,538,596		$	11,517,836
Total earning assets	$	12,326,472		$	12,180,872		$	11,236,440
Total loans⁽³⁾	$	7,053,701		$	6,890,414		$	7,726,716
Total deposits	$	10,874,976		$	10,670,205		$	9,601,249
Total borrowings	$	371,987		$	402,393		$	573,750
Total shareholders’ equity	$	1,341,626		$	1,342,525		$	1,254,780

Asset Quality:
Net charge-offs	$	459		$	1,165		$	5,284
Non-performing loans	$	23,750		$	29,208		$	52,276
Other real estate owned	$	1,635		$	1,635		$	4,987
Non-performing assets	$	25,386		$	30,843		$	57,262

(1) A reconciliation of non-GAAP financial measures to the nearest non-GAAP measure is provided in the tables that accompany this document.
(2) Computed by dividing noninterest expense by the sum of net interest income and noninterest income. The efficiency ratio measures a bank’s overhead as a percentage of its revenue.
(3) Excludes loans held for sale.


GAAP Reconciliation (unaudited)
(dollars in thousands, except per share data)

	March 31,			December 31,			March 31,
	2022			2021			2021
Common shareholders’ equity	$	1,265,274		$	1,350,775		$	1,260,833
Less: Intangible assets		(104,241	)		(105,793	)		(105,179	)
Tangible common equity	$	1,161,033		$	1,244,982		$	1,155,654

Book value per common share	$	39.44		$	42.28		$	39.45
Less: Intangible book value per common share		(3.25	)		(3.31	)		(3.29	)
Tangible book value per common share	$	36.19		$	38.97		$	36.16

Total assets	$	11,212,943		$	11,847,310		$	11,127,864
Less: Intangible assets		(104,241	)		(105,793	)		(105,179	)
Tangible assets	$	11,108,702		$	11,741,517		$	11,022,685

Tangible common equity ratio		10.45	%		10.60	%		10.48	%

Allowance for credit losses	$	71,505		$	74,965		$	102,070

Total loans, excluding loans held for sale	$	7,113,807		$	7,065,598		$	7,526,689
Less: PPP loans (non-GAAP)		(35,744	)		(51,105	)		(565,018	)
Total loans excluding PPP loans (non-GAAP)	$	7,078,063		$	7,014,493		$	6,961,671

Allowance for credit losses:
As a % of total loans (GAAP)		1.01	%		1.06	%		1.36	%
As a % of total loans excl. PPP loans (non-GAAP)		1.01	%		1.07	%		1.47	%

	Three Months Ended
	March 31,			December 31,			March 31,
	2022			2021			2021
Average common shareholders’ equity		1,341,626		$	1,342,525		$	1,254,780
Less: Average intangible assets		(104,246	)		(105,565	)		(105,164	)
Average tangible common equity	$	1,237,380		$	1,236,960		$	1,149,616

Net Income Available to Common Shareholders	$	45,744		$	41,620		$	43,469
Return on Average Tangible Common Equity ⁽¹⁾		14.99	%		13.35	%		15.33	%

Net interest income	$	80,452		$	78,186		$	82,651
Noninterest income		7,453			10,574			10,587
Operating revenue	$	87,905		$	88,760		$	93,238
Noninterest expense	$	31,012		$	39,309		$	37,987
Efficiency ratio		35.3	%		44.3	%		40.7	%

Salaries and employee benefits	$	17,019		$	24,608
Accrual reduction for former CEO and Chairman		5,018			—
Adj. Salaries and employee benefits (non-GAAP)	$	22,037		$	24,608
Change	$	(2,571	)

(1) Periods of less than a year are annualized.

Non-GAAP Reconciliation (unaudited) – Continued

Tangible common equity to tangible assets (the “tangible common equity ratio”), tangible book value per common share, and the return on average tangible common equity are non-GAAP financial measures derived from GAAP based amounts. The Company calculates the tangible common equity ratio by excluding the balance of intangible assets from common shareholders’ equity and dividing by tangible assets. The Company calculates tangible book value per common share by dividing tangible common equity by common shares outstanding, as compared to book value per common share, which the Company calculates by dividing common shareholders’ equity by common shares outstanding. The Company calculates the annualized return on average tangible common equity ratio by dividing net income available to common shareholders by average tangible common equity which is calculated by excluding the average balance of intangible assets from the average common shareholders’ equity. The Company considers this information important to shareholders as tangible equity is a measure that is consistent with the calculation of capital for bank regulatory purposes, which excludes intangible assets from the calculation of risk based ratios and as such is useful for investors, regulators, management and others to evaluate capital adequacy and to compare against other financial institutions. The above table provides reconciliation of these financial measures defined by GAAP with non-GAAP financial measures.

Pre-provision net revenue is a non-GAAP financial measure derived from GAAP based amounts. The Company calculates PPNR by subtracting noninterest expenses from the sum of net interest income and noninterest income. PPNR to Average Assets is calculated by dividing the PPNR amount by average assets to obtain a percentage. The Company considers this information important to shareholders because it illustrates revenue excluding the impact of provisions and reversals to the allowance for credit losses on loans. The table in the “Income Statement” section of this earnings release provides a reconciliation of PPNR and PPNR to Average Assets to the nearest GAAP measure.

Total loans excluding PPP loans is a non-GAAP financial measure derived from GAAP based amounts. The Company calculates Total loans excluding PPP loans by subtracting the total amount of outstanding PPP loans from the amount of total loans, excluding loans held for sale. The Company considers this information important to shareholders because it allows investors to see changes in the Company’s loan growth without the impact of the PPP loans, which were loan products specific to relief efforts in response to the COVID-19 pandemic. Excluding the impact of PPP loans also allows investors to better compare the Company’s loan growth to historical periods prior to the pandemic. The table in the “Balance Sheet” section of this earnings release and the table above provides a reconciliation of total loans excluding PPP loans to the nearest GAAP measure.

Efficiency ratio is a non-GAAP measure calculated by dividing GAAP non-interest expense by the sum of GAAP net interest income and GAAP non-interest (loss) income. Management believes that reporting the non-GAAP efficiency ratio more closely measures its effectiveness of controlling operational activities. The table above shows the calculation of the efficiency ratio from these GAAP measures.

Adjusted Salaries and Employee Benefits is a non-GAAP financial measure derived from GAAP based amounts. The Company calculates Adjusted Salaries and Employee Benefits by subtracting from total salaries and employee benefits the one-time accrual reduction of $5.0 million related to share-based compensation awards and deferred compensation for the Company’s former CEO and Chairman in the first quarter of 2022. The Company considers this information important to shareholders because the accrual reduction was a one-time event that occurred during the first quarter of 2022. The Adjusted Salaries and Employee Benefits non-GAAP measure provides investors insight into how salaries and employee benefits changed during the first quarter of 2022 exclusive of the one-time accrual reduction, and allows investors to better compare the Company’s performance against historical periods. The table above provides a reconciliation of Adjusted Salaries and Employee Benefits to the nearest GAAP measure.


Eagle Bancorp, Inc.
Consolidated Balance Sheets (Unaudited)
(Dollars in thousands, except per share data)
	March 31,			December 31,			March 31,
Assets	2022			2021			2021
Cash and due from banks	$	12,140		$	12,886		$	9,112
Federal funds sold		27,359			20,391			25,785
Interest bearing deposits with banks and other short-term investments		682,883			1,680,945			1,708,374
Investment securities available for sale at fair value (amortized cost of $1,877,129 , $2,652,667, and $1,370,927, net of allowance for credit losses of $18, $620 and $78 as of March 31, 2022, December 31, 2021 and March 31, 2021, respectively)		1,774,816			2,623,408			1,369,107
Investment securities held to maturity (fair value of $1,144,505, $0 and $0, net of allowance for credit losses of $817, $0 and $0, as of March 31, 2022, December 31, 2021 and March 31, 2021, respectively)		1,154,216			—			—
Federal Reserve and Federal Home Loan Bank stock		29,026			34,153			33,978
Loans held for sale		25,504			47,218			142,196
Loans		7,113,807			7,065,598			7,526,689
Less allowance for credit losses		(71,505	)		(74,965	)		(102,070	)
Loans, net		7,042,302			6,990,633			7,424,619
Premises and equipment, net		14,014			14,557			15,045
Operating lease right-of-use assets		28,969			30,555			30,707
Deferred income taxes		66,807			43,174			44,623
Bank owned life insurance		109,415			108,789			77,119
Intangible assets, net		104,241			105,793			105,179
Other real estate owned		1,635			1,635			4,987
Other assets		139,616			133,173			137,033
Total Assets	$	11,212,943		$	11,847,310		$	11,127,864
Liabilities and Shareholders’ Equity
Deposits:
Noninterest bearing demand	$	2,951,594		$	3,277,956		$	2,594,334
Interest bearing transaction		888,598			777,255			862,709
Savings and money market		5,047,548			5,197,247			4,875,840
Time deposits		698,519			729,082			865,961
Total deposits		9,586,259			9,981,540			9,198,844
Customer repurchase agreements		28,293			23,918			20,061
Other short-term borrowings		150,000			300,000			300,000
Long-term borrowings		69,701			69,670			218,175
Operating lease liabilities		33,935			35,501			33,338
Reserve for unfunded commitments		4,369			4,379			5,056
Other liabilities		75,112			81,527			91,557
Total liabilities		9,947,669			10,496,535			9,867,031
Shareholders’ Equity
Common stock, par value $.01 per share; shares authorized 100,000,000, shares issued and outstanding 32,079,474, 31,950,092, and 31,960,379 respectively		318			316			316
Additional paid in capital		437,820			434,640			428,917
Retained earnings		963,140			930,061			833,598
Accumulated other comprehensive loss		(136,004	)		(14,242	)		(1,998	)
Total Shareholders’ Equity		1,265,274			1,350,775			1,260,833
Total Liabilities and Shareholders’ Equity	$	11,212,943		$	11,847,310		$	11,127,864


Eagle Bancorp, Inc.
Consolidated Statements of Income (Unaudited)
(Dollars in thousands, except per share data)
	Three Months Ended
	March 31,			December 31,			March 31,
	2022			2021			2021
Interest Income
Interest and fees on loans	$	75,830		$	77,625		$	89,238
Interest and dividends on investment securities		11,430			7,327			4,395
Interest on balances with other banks and short-term investments		1,057			1,272			553
Interest on federal funds sold		4			6			8
Total interest income		88,321			86,230			94,194

Interest Expense
Interest on deposits		6,359			6,484			7,899
Interest on customer repurchase agreements		13			17			11
Interest on other short-term borrowings		460			506			495
Interest on long-term borrowings		1,037			1,037			3,138
Total interest expense		7,869			8,044			11,543
Net Interest Income		80,452			78,186			82,651
Provision / (Reversal) for Credit Losses		(2,787	)		(6,412	)		(2,350	)
Provision / (Reversal) for Unfunded Commitments		(11	)		(632	)		(442	)
Net Interest Income After Provision For Credit Losses		83,250			85,230			85,443

Noninterest Income
Service charges on deposits		1,286			1,259			977
Gain on sale of loans		1,492			2,057			5,178
Gain (loss) on sale of investment securities		(25	)		906			221
Increase in the cash surrender value of bank owned life insurance		627			630			389
Other income		4,073			5,722			3,822
Total noninterest income		7,453			10,574			10,587

Noninterest Expense
Salaries and employee benefits		17,019			24,608			21,769
Premises and equipment expenses		3,128			3,755			3,618
Marketing and advertising		1,064			1,286			886
Data processing		2,880			3,258			2,814
Legal, accounting and professional fees		1,561			2,987			2,999
FDIC insurance		1,058			311			2,428
Other expenses		4,302			3,104			3,473
Total noninterest expense		31,012			39,309			37,987
Income Before Income Tax Expense		59,691			56,495			58,043
Income Tax Expense		13,947			14,875			14,574
Net Income	$	45,744		$	41,620		$	43,469

Earnings Per Common Share
Basic	$	1.43		$	1.30		$	1.36
Diluted	$	1.42		$	1.30		$	1.36


Eagle Bancorp, Inc.
Consolidated Average Balances, Interest Yields And Rates (Unaudited)
(Dollars in thousands)
	Three Months Ended March 31,
	2022						2021
	Average Balance		Interest		Average Yield/Rate		Average Balance		Interest		Average Yield/Rate
ASSETS
Interest earning assets:
Interest bearing deposits with other banks and other short-term investments	$	2,403,017	$	1,057	0.18	%	$	2,103,679	$	553	0.11	%
Loans held for sale⁽¹⁾		26,887		219	3.26	%		104,784		739	2.82	%
Loans^{(1) (2)}		7,053,701		75,611	4.35	%		7,726,716		88,499	4.65	%
Investment securities available for sale⁽²⁾		2,794,681		11,280	1.64	%		1,268,952		4,395	1.40	%
Investment securities held to maturity⁽²⁾		24,011		150	2.53	%		—		—	—	%
Federal funds sold		24,176		4	0.07	%		32,309		8	0.10	%
Total interest earning assets		12,326,473		88,321	2.91	%		11,236,440		94,194	3.40	%
Total noninterest earning assets		449,625						390,775
Less: allowance for credit losses		75,105						109,379
Total noninterest earning assets		374,520						281,396
TOTAL ASSETS	$	12,700,993					$	11,517,836
LIABILITIES AND SHAREHOLDERS’ EQUITY
Interest bearing liabilities:
Interest bearing transaction	$	754,833	$	322	0.17	%	$	771,321	$	427	0.22	%
Savings and money market		5,476,721		3,723	0.28	%		4,839,348		3,970	0.33	%
Time deposits		722,646		2,314	1.30	%		921,208		3,503	1.54	%
Total interest bearing deposits		6,954,200		6,359	0.37	%		6,531,877		7,900	0.49	%
Customer repurchase agreements		25,628		13	0.21	%		20,615		11	0.22	%
Other short-term borrowings		276,669		460	0.67	%		300,003		495	0.66	%
Long-term borrowings		69,690		1,037	5.95	%		253,132		3,137	4.96	%
Total interest bearing liabilities		7,326,187		7,869	0.44	%		7,105,627		11,543	0.66	%
Noninterest bearing liabilities:
Noninterest bearing demand		3,920,776						3,069,372
Other liabilities		112,404						88,057
Total noninterest bearing liabilities		4,033,180						3,157,429
Shareholders’ equity		1,341,626						1,254,780
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	12,700,993					$	11,517,836
Net interest income			$	80,452					$	82,651
Net interest spread					2.47	%					2.74	%
Net interest margin					2.65	%					2.98	%
Cost of funds					0.26	%					0.42	%

(1) Loans placed on nonaccrual status are included in average balances. Net loan fees and late charges included in interest income on loans totaled $3.7 million and $7.8 million for the three months ended March 31, 2022 and March 31, 2021, respectively.
(2) Interest and fees on loans and investments exclude tax equivalent adjustments.


Eagle Bancorp, Inc.
Statements of Income and Highlights Quarterly Trends (Unaudited)
(Dollars in thousands, except per share data)

	Three Months Ended
	March 31,			December 31,			September 30,			June 30,			March 31,			December 31,			September 30,			June 30,
Income Statements:	2022			2021			2021			2021			2021			2020			2020			2020
Total interest income	$	88,321		$	86,230		$	89,152		$	94,920		$	94,194		$	94,680		$	93,833		$	97,672
Total interest expense		7,869			8,044			10,107			10,288			11,543			13,262			14,795			16,309
Net interest income		80,452			78,186			79,045			84,632			82,651			81,418			79,038			81,363
Provision (reversal) for credit losses		(2,787	)		(6,412	)		(8,203	)		(3,856	)		(2,350	)		4,917			6,607			19,737
Provision (reversal) for unfunded commitments		(11	)		(632	)		716			(761	)		(442	)		406			(2,078	)		940
Net interest income after provision for credit losses		83,250			85,230			86,532			89,249			85,443			76,095			74,509			60,686
Noninterest income (before investment gain (loss))		7,478			9,668			6,780			10,607			10,366			9,722			17,729			11,782
Gain on sale of investment securities		(25	)		906			1,519			318			221			165			115			713
Total noninterest income		7,453			10,574			8,299			10,925			10,587			9,887			17,844			12,495
Salaries and employee benefits		17,019			24,608			22,145			19,876			21,769			20,151			19,388			17,104
Premises and equipment		3,128			3,755			3,859			3,644			3,618			3,301			5,125			3,468
Marketing and advertising		1,064			1,286			1,013			980			886			1,161			928			1,111
Other expenses		9,801			9,660			9,358			10,994			11,714			10,396			11,474			13,209
Total noninterest expense		31,012			39,309			36,375			35,494			37,987			35,009			36,915			34,892
Income before income tax expense		59,691			56,495			58,456			64,680			58,043			50,973			55,438			38,289
Income tax expense		13,947			14,875			14,847			16,687			14,574			12,081			14,092			9,433
Net income	$	45,744		$	41,620		$	43,609		$	47,993		$	43,469		$	38,892		$	41,346		$	28,856
Per Share Data:
Earnings per weighted average common share, basic	$	1.43		$	1.30		$	1.36		$	1.50		$	1.36		$	1.21		$	1.28		$	0.90
Earnings per weighted average common share, diluted	$	1.42		$	1.30		$	1.36		$	1.50		$	1.36		$	1.21		$	1.28		$	0.90
Weighted average common shares outstanding, basic		32,033,280			31,950,320			31,959,357			31,962,819			31,869,655			32,037,099			32,229,322			32,224,695
Weighted average common shares outstanding, diluted		32,110,099			32,030,998			32,030,527			32,025,110			31,922,940			32,075,175			32,250,885			32,240,825
Actual shares outstanding at period end		32,079,474			31,950,092			31,947,458			31,961,573			31,960,379			31,779,663			32,228,636			32,224,756
Book value per common share at period end	$	39.44		$	42.28		$	41.68		$	40.87		$	39.45		$	39.05		$	37.96		$	36.86
Tangible book value per common share at period end⁽¹⁾	$	36.19		$	38.97		$	38.39		$	37.58		$	36.16		$	35.74		$	34.70		$	33.62
Dividend per common share	$	0.40		$	0.40		$	0.40		$	0.35		$	0.25		$	0.22		$	0.22		$	0.22
Performance Ratios (annualized):
Return on average assets		1.46	%		1.32	%		1.46	%		1.68	%		1.53	%		1.39	%		1.57	%		1.12	%
Return on average common equity		13.83	%		12.30	%		13.00	%		14.92	%		14.05	%		12.53	%		14.46	%		9.84	%
Return on average tangible common equity⁽¹⁾		14.99	%		13.35	%		14.11	%		16.25	%		15.33	%		13.69	%		15.93	%		10.80	%
Net interest margin		2.65	%		2.55	%		2.73	%		3.04	%		2.98	%		2.98	%		3.08	%		3.26	%
Efficiency ratio⁽²⁾		35.3	%		44.3	%		41.7	%		37.1	%		40.7	%		38.3	%		38.1	%		37.2	%
Other Ratios:
Allowance for credit losses to total loans⁽³⁾		1.01	%		1.06	%		1.21	%		1.28	%		1.36	%		1.41	%		1.40	%		1.36	%
Allowance for credit losses to total nonperforming loans		301	%		257	%		265	%		187	%		195	%		180	%		190	%		185	%
Nonperforming loans to total loans⁽³⁾		0.33	%		0.41	%		0.46	%		0.68	%		0.69	%		0.79	%		0.74	%		0.74	%
Nonperforming assets to total assets		0.23	%		0.26	%		0.31	%		0.50	%		0.51	%		0.59	%		0.62	%		0.69	%
Net charge-offs (annualized) to average total loans⁽³⁾		0.03	%		0.07	%		0.08	%		0.30	%		0.27	%		0.28	%		0.26	%		0.36	%
Tier 1 capital (to average assets)		9.82	%		10.19	%		10.58	%		10.65	%		10.28	%		10.31	%		10.82	%		10.63	%
Total capital (to risk weighted assets)		15.72	%		16.15	%		16.59	%		17.98	%		17.86	%		17.04	%		16.72	%		16.26	%
Common equity tier 1 capital (to risk weighted assets)		14.60	%		15.02	%		15.33	%		14.67	%		14.42	%		13.49	%		13.19	%		12.80	%
Tangible common equity ratio⁽¹⁾		10.45	%		10.60	%		10.68	%		11.07	%		10.48	%		10.31	%		11.18	%		11.17	%
Average Balances (in thousands):
Total assets	$	12,700,993		$	12,538,596		$	11,826,326		$	11,453,080		$	11,517,836		$	11,141,826		$	10,473,595		$	10,326,709
Total earning assets	$	12,326,472		$	12,180,872		$	11,486,280		$	11,152,933		$	11,236,440		$	10,872,259		$	10,205,939		$	10,056,500
Total loans⁽³⁾	$	7,053,701		$	6,890,414		$	7,055,621		$	7,382,238		$	7,726,716		$	7,896,324		$	7,910,260		$	8,015,751
Total deposits	$	10,874,976		$	10,670,206		$	9,948,114		$	9,530,909		$	9,601,249		$	9,227,733		$	8,591,912		$	8,482,718
Total borrowings	$	371,987		$	402,393		$	448,697		$	536,926		$	573,750		$	596,307		$	596,472		$	598,463
Total shareholders’ equity	$	1,341,626		$	1,342,525		$	1,331,022		$	1,290,029		$	1,254,780		$	1,235,174		$	1,211,145		$	1,179,452

(1) See footnote (1) for Consolidated Financial Highlights.
(2) Computed by dividing noninterest expense by the sum of net interest income and noninterest income.
(3) Excludes loans held for sale.

EAGLE BANCORP, INC

CONTACT:

David G. Danielson
240.552.9534

April 20, 2022 4:58 pm

Globe Life Announces Executive Promotions

PR Newswire

MCKINNEY, Texas
, April 20, 2022 /PRNewswire/ — Globe Life Inc. (NYSE:GL) announced today the promotions of Frank Svoboda and Matt Darden to the newly created titles of Senior Executive Vice President and Chief Financial Officer and Senior Executive Vice President and Chief Strategy Officer, respectively.

“We congratulate Frank and Matt on their well-deserved promotions which reflect the significant contributions they have made to Globe Life over the past several years,” said Globe Life Co-Chairmen and Chief Executive Officers Gary Coleman and Larry Hutchison. “They have each provided outstanding executive leadership and together they bring a vast range of experience and skill sets to the Company. Frank and Matt have been instrumental in the development and execution of the Company’s strategy and will continue to work closely with us on all aspects of Globe Life’s business.”

Globe Life Inc. is a holding company specializing in life and supplemental health insurance for middle-income families marketed through multiple distribution channels including direct to consumer, and exclusive and independent agencies.

View original content to download multimedia:https://www.prnewswire.com/news-releases/globe-life-announces-executive-promotions-301529612.html

SOURCE Globe Life Inc.

April 20, 2022 4:56 pm

United Security Bancshares Reports 1st Quarter 2022 Financial Results

United Security Bancshares Reports 1st Quarter 2022 Financial Results

FRESNO, Calif.–(BUSINESS WIRE)–United Security Bancshares (Nasdaq: UBFO) today announced its unaudited financial results for the quarter ended March 31, 2022. The Company recognized net income of $2.4 million, or $0.14 per basic and diluted share, for the quarter ended March 31, 2022, compared to net income of $1.4 million, or $0.08 per basic and diluted share for the quarter ended March 31, 2021.

First Quarter 2022 Highlights (at or for the quarter ended March 31, 2022, except where noted)

Net income for the quarter increased 73.1% to $2.4 million, compared to $1.4 million for the quarter ended March 31, 2021. Loan interest income increased $1.0 million and investment securities income increased $0.4 million as a result of significant growth in loan and investment securities portfolio balances compared to the first quarter of 2021.

Total assets increased 1.4% to $1.35 billion, compared to $1.33 billion at December 31, 2021.

Total loans, net of unearned fees, increased 0.9% to $879.4 million, compared to $871.5 million at December 31, 2021. Included in total loans are $35.6 million in residential mortgage loans purchased during the quarter.

Total investments increased 0.5%, or $0.9 million, to $183.5 million, compared to $182.6 million at December 31, 2021.

Total deposits increased 2.2% to $1.21 billion, compared to $1.19 billion at December 31, 2021.

The allowance for credit losses as a percentage of gross loans decreased to 1.06%, compared to 1.07% at December 31, 2021. The decrease in the allowance for credit losses as a percentage of gross loans is principally due to growth in the purchased residential mortgage loan portfolio, which requires lower reserves compared to other loan segments.

Net interest income before the provision for credit losses increased 17.3% to $9.4 million for the quarter ended March 31, 2022, compared to $8.0 million for the quarter ended March 31, 2021.

Book value per share decreased to $6.67, compared to $7.06 at December 31, 2021 resulting from an increase in accumulated other comprehensive loss related to unrealized losses within the investment portfolio.

Net interest margin decreased to 3.10% from 3.16% for the quarter ended March 31, 2021.

Annualized average cost of deposits was 0.17% for the quarters ended March 31, 2022 and March 31, 2021.

Net charge-offs decreased to $61,000, compared to net charge-offs of $348,000 for the quarter ended March 31, 2021.

Capital position remains well-capitalized with a 9.62% Tier 1 Leverage Ratio compared to 9.79% as of December 31, 2021.

Annualized return on average assets (“ROAA”) was 0.74%, compared to 0.51% for the quarter ended March 31, 2021.

Annualized return on average equity (“ROAE”) was 8.33%, compared to 4.82% for the quarter ended March 31, 2021.

Dennis Woods, President and Chief Executive Officer, stated: “The first quarter reflected a continuation of the positive momentum experienced in 2021. We saw solid growth in revenue, our deposit base, and our loan and investment portfolios. During the first quarter, we began to execute our 2022 strategy which includes investments in loans and securities, in addition to organic loan growth. Core net income, which is a non-GAAP measure, grew 47.0% over the prior year as a result of robust deposit growth and the successful execution of our 2021 cash deployment strategy. Our credit quality, capital, and liquidity levels remain strong and we are well-positioned to benefit from the increases in interest rates anticipated this year.”

Provided at the end of this Press Release is a reconciliation of Core Net Income, as a non-GAAP measure, to Net Income. This reconciliation excludes Non-Core items such as the Fair Value Adjustment for TRUPs and gain or loss on sale of other real estate owned (OREO). Management believes that financial results are more comparative excluding the impact of such non-core items.

Results of Operations

Net income for the quarter ended March 31, 2022 increased $1.0 million when compared to the quarter ended March 31, 2021. The increase is the result of increases of $1.0 million in loan interest income and fees, $0.4 million in investment income, and lower provision expense, partially offset by an increase of $431,000 in the tax provision and an increase of $122,000 in professional fees. The change in fair value of junior subordinated debentures, which is caused by changes in LIBOR rates, was reflected as a $1,033,000 loss for the quarter ended March 31, 2021, compared to a $999,000 loss for the quarter ended March 31, 2022. The provision for credit losses was $5,000 for the quarter ended March 31, 2022, compared to $375,000 for the quarter ended March 31, 2021. ROAE for the quarter ended March 31, 2022 was 8.33%, compared to 4.82% for the quarter ended March 31, 2021. ROAA was 0.74% for the quarter ended March 31, 2022, compared to 0.51% for the quarter ended March 31, 2021.

The annualized average cost of deposits was 0.17% for the quarters ended March 31, 2022 and March 31, 2021. Average interest-bearing deposits increased 25.7% between the periods ended March 31, 2021 and 2022 from $578.5 million to $727.1 million, respectively.

Net interest income, before the provision for credit losses, for the quarter ended March 31, 2022 totaled $9.4 million, an increase of $1.4 million, or 17.3%, from $8.0 million for the same period ended March 31, 2021. The impact of the Company’s 2021 phase 1 and phase 2 cash deployment strategies, which included over $250 million in investment and mortgage loan purchases, are reflected in the increase in net interest income. The Company’s net interest margin contracted from 3.16% for the quarter ended March 31, 2021 to 3.10% for the quarter ended March 31, 2022. The decrease was the result of earning assets repricing in the current interest rate environment. This decrease was partially offset by a decrease in the yield on interest-bearing liabilities. Loan yields decreased from 4.89% to 4.25% between the two periods. The yield on interest-bearing liabilities decreased from 0.33% to 0.30% between the two periods. Included in interest income for the quarter ended March 31, 2022 were $121,000 in fees related to SBA PPP loans, compared to $345,000 for the same period ended March 31, 2021.

Noninterest income for the quarter ended March 31, 2022 reflected a loss of $206,000, amounting to an increase in loss of $47,000 when compared to the loss of $159,000 reported for the quarter ended March 31, 2021. On a year-over-year comparative basis, noninterest income decreased primarily due to an increase in the loss on equity securities of $122,000. Customer service fees totaled $654,000 for the quarter ended March 31, 2022 and $656,000 for the quarter ended March 31, 2021. For the quarter ended March 31, 2022, a loss on the fair value of junior subordinated debentures (TRUPs) of $999,000 was recorded, compared to a loss of $1,033,000 for the same period in 2021. The change in the fair value of TRUPs reflected in noninterest income was caused by fluctuations in the LIBOR yield curve. Generally, an increase in the three month LIBOR yield curve will result in negative fair value adjustments. Conversely, a decrease in the three month LIBOR yield curve will result in positive fair value adjustments.

For the quarter ended March 31, 2022, noninterest expense totaled $5.82 million, an increase of $251,000 compared to $5.57 million for the quarter ended March 31, 2021. On a year-over-year comparative basis, noninterest expense increased due to increases in professional fees of $122,000 and increases in regulatory assessments of $65,000 due to an increase in FDIC assessment rate. Other noninterest expense increased $88,000 due to higher telephone and insurance expense.

The efficiency ratio for the quarter ended March 31, 2022 decreased to 63.0%, compared to 70.6% for the quarter ended March 31, 2021. This decrease is attributed to revenue growth outpacing the increase in noninterest expense.

The Company recorded an income tax provision of $968,000 for the quarter ended March 31, 2022, compared to $537,000 for the same period in 2021. The effective tax rate for the quarter ended March 31, 2022 was 28.38%, compared to 27.57% for the quarter ended March 31, 2021.

Balance Sheet Review

Total assets increased $18.9 million, or 1.4%, between December 31, 2021 and March 31, 2022. Gross loan balances grew $7.6 million and investment securities increased $0.9 million. Included in the loan and investment growth during the quarter were purchases of $35.6 million in residential mortgage loans and $34.6 million in investment securities, respectively. Total cash and cash equivalents increased $5.7 million between December 31, 2021 and March 31, 2022. Unfunded loan commitments decreased from $239.1 million at December 31, 2021 to $225.4 million at March 31, 2022. OREO balances remained at $4.6 million at December 31, 2021 and March 31, 2022.

Total deposits increased $26.2 million, or 2.2%, to $1.2 billion during the quarter ended March 31, 2022. This increase was due to increases of $26.5 million in NOW and money market accounts and $14.4 million in savings accounts, offset by decreases of $11.7 million in noninterest bearing deposits and $3.0 million in time deposits. In total, NOW, money market and savings accounts increased 6.4% to $684.7 million at March 31, 2022, compared to $643.8 million at December 31, 2021. Noninterest bearing deposits decreased 2.5% to $465.0 million at March 31, 2022, compared to $476.7 million at December 31, 2021. Core deposits, which are made up of the balance of noninterest bearing deposits, NOW, money market, savings, and time deposits accounts less than $250,000, increased $26.8 million.

Shareholders’ equity at March 31, 2022 was $113.6 million, a decrease of $6.6 million from shareholders’ equity of $120.2 million at December 31, 2021. This decrease in equity was primarily attributed to an increase in accumulated other comprehensive loss. At March 31, 2022, the accumulated other comprehensive loss totaled $8.5 million, compared to $1.2 million at December 31, 2021. The increase in the loss was primarily the result of unrealized losses on investment securities of $8.2 million and was partially offset by a $0.9 million gain on junior subordinated debentures (TRUPs) caused by a change in market credit spreads during the quarter ended March 31, 2022. The change unrealized loss on the investment portfolio is attributed to changes in interest rates, and not credit quality. The Company does not intend to sell and it is more likely than not that it will not be required to sell any securities that have an unrealized loss.

The Board of Directors of United Security Bancshares declared a cash dividend on common stock of $0.11 per share on March 22, 2022. The dividend was payable on April 18, 2022, to shareholders of record as of April 6, 2022. No assurances can be provided that future dividends will be declared and/or as to the timing of such future dividends, if any. The Company continues to be well capitalized and expects to maintain adequate capital levels.

Credit Quality

The Company recorded a provision for credit losses of $5,000 for the quarter ended March 31, 2022, compared to a provision of $375,000 for the quarter ended March 31, 2021. Net loan charge-offs totaled $61,000 for the quarter ended March 31, 2022, as compared to net loan charge-offs of $348,000 for the quarter ended March 31, 2021. The reduced provision recorded during the quarter is attributed to lower net charge-offs, decreases in nonperforming assets and lower loan portfolio growth rate, partially offset by a qualitative adjustment for economic uncertainty resulting in an increase in required reserves. The qualitative adjustment is attributed to higher inflation, anticipated magnitude of interest rate hikes in 2022 and 2023, and the increased likelihood of a recession. For the quarter ended March 31, 2021, the provision recorded was attributed to growth of the loan portfolio and net charge-offs recognized in the student loan portfolio.

The Company’s allowance for loan loss totaled 1.06% of the loan portfolio at March 31, 2022, compared to 1.07% at December 31, 2021. The decrease in the allowance for credit losses as a percentage of gross loans is primarily the result of a change in loan mix resulting from purchases of residential mortgage loans during the first quarter. The reserve required on the residential mortgage loan segment is lower than reserves required for other loan segments due to lower historical loss rates. Management considers the allowance for credit losses at March 31, 2022 to be adequate.

Non-performing assets, comprised of nonaccrual loans, troubled debt restructures (TDRs), other real estate owned through foreclosure, and loans more than 90 days past due and still accruing interest, decreased $593,000 between December 31, 2021 and March 31, 2022 to $16.1 million. Nonperforming assets as a percentage of total assets decreased from 1.25% at December 31, 2021 to 1.19% at March 31, 2022. The decrease in nonperforming assets is attributed to decreases in total restructured loans of $140,000 between December 31, 2021 and March 31, 2022. OREO balances remained at $4.6 million at December 31, 2021 and March 31, 2022. Nonaccrual loans decreased $108,000 between December 31, 2021 and March 31, 2022.

About United Security Bancshares

United Security Bancshares (NASDAQ: UBFO) is the holding company for United Security Bank, which was founded in 1987. United Security Bank is headquartered in Fresno and operates 12 full-service branch offices in Fresno, Bakersfield, Campbell, Caruthers, Coalinga, Firebaugh, Mendota, Oakhurst, San Joaquin, and Taft, California. Additionally, United Security Bank operates Commercial Real Estate Construction, Commercial Lending, and Consumer Lending departments. For more information, please visit www.unitedsecuritybank.com.

Non-GAAP Financial Measures

This press release and the accompanying financial tables contain a non-GAAP financial measure (Net Income before Non-Core) within the meaning of the Securities and Exchange Commission’s Regulation G. In the accompanying financial tables, the Company has provided a reconciliation of this non-GAAP financial measure to the most directly comparable GAAP financial measure. The Company’s management believes that this non-GAAP financial measure provides useful information about the Company’s results of operations and/or financial position to both investors and management. The Company provides this non-GAAP financial measure to investors to assist them in performing their analysis of its historical operating results. The non-GAAP financial measure shows the Company’s operating results before consideration of certain adjustments and, consequently, this non-GAAP financial measure should not be construed as an alternative to net income (loss) as an indicator of the Company’s operating performance, as determined in accordance with GAAP. The Company may calculate this non-GAAP financial measure differently than other companies.

Forward-Looking Statements

This press release 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, and the Company intends such statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts and often include the words “believe,” “expect,” “anticipate,” “intend,” “plan,” “estimate,” or words of similar meaning, or future or conditional verbs such as “will,” “would,” “should,” “could,” or “may.” Forward-looking statements are based on management’s knowledge and belief as of today and are not guarantees of future performance, nor should they be relied upon as representing management’s views as of any subsequent date. Forward-looking statements are subject to risks and uncertainties and actual results may differ materially from those presented. Factors that might cause such differences, some of which are beyond the Company’s ability to control or predict, include, but are not limited to: (1) the effects of the COVID-19 pandemic, or other similar outbreaks, including the effects of the steps being taken to address the pandemic and their impact on the Company’s markets, customers and employees, (2) changes in general economic and financial market conditions, either nationally or locally, (3) changes in interest rates, (4) changes in banking laws or regulations, (5) increased competition in the Company’s markets, impacting the ability to execute its business plans, (6) loss of key personnel, (7) unanticipated credit losses, (8) drought, earthquakes or other natural disasters impacting the local economy and/or the condition of real estate collateral, (9) the impact of technological changes and the ability to develop and maintain secure and reliable electronic systems, (10) uncertainty regarding the replacement of LIBOR, and (11) changes in accounting policies or procedures.

The Company undertakes no obligation to publicly revise these forward-looking statements to reflect subsequent events or circumstances. For a more complete discussion of these risks and uncertainties, see the Company’s Annual Report on Form 10-K, for the year ended December 31, 2021, and particularly the section entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Readers should carefully review all disclosures the Company files from time to time with the Securities and Exchange Commission.

United Security Bancshares
Consolidated Balance Sheets (unaudited)
(in thousands- except share data)
	March 31, 2022			December 31, 2021
Assets
Cash and non-interest-bearing deposits in other banks	$	38,243		$	31,057
Due from Federal Reserve Bank (“FRB”)		186,691			188,162
Cash and cash equivalents		224,934			219,219

Investment securities (at fair value)
Available-for-sale (“AFS”) securities		179,964			178,902
Marketable equity securities		3,563			3,744
Total investment securities		183,527			182,646
Loans		876,963			869,314
Unearned fees and unamortized loan origination costs – net		2,416			2,219
Allowance for credit losses		(9,276	)		(9,333	)
Net loans		870,103			862,200

Premises and equipment – net		8,920			8,950
Accrued interest receivable		7,801			7,530
Other real estate owned (“OREO”)		4,582			4,582
Goodwill		4,488			4,488
Deferred tax assets – net		6,974			3,615
Cash surrender value of life insurance		22,477			22,338
Operating lease right-of-use assets		2,443			2,594
Other assets		13,553			12,782
Total assets	$	1,349,802		$	1,330,944

Liabilities and Shareholders’ Equity
Deposits
Noninterest-bearing	$	465,043		$	476,749
Interest-bearing		749,289			711,357
Total deposits		1,214,332			1,188,106

Operating lease liabilities		2,554			2,705
Other liabilities		8,455			8,737
Junior subordinated debentures (at fair value)		10,887			11,189
Total liabilities		1,236,228			1,210,737

Shareholders’ Equity
Common stock, no par value; 20,000,000 shares authorized; issued and outstanding: 17,034,407 at March 31, 2022 and 17,028,239 at December 31, 2021.		59,736			59,636
Retained earnings		62,313			61,745
Accumulated other comprehensive loss		(8,475	)		(1,174	)
Total shareholders’ equity		113,574			120,207
Total liabilities and shareholders’ equity	$	1,349,802		$	1,330,944

United Security Bancshares
Consolidated Statements of Income (unaudited)
(in thousands – except share data)
	Three Months Ended
	March 31, 2022			March 31, 2021
Interest Income:
Interest and fees on loans	$	9,119		$	8,071
Interest on investment securities		790			387
Interest on deposits in FRB		82			62
Total interest income		9,991			8,520

Interest Expense:
Interest on deposits		508			427
Interest on other borrowed funds		45			46
Total interest expense		553			473
Net Interest Income		9,438			8,047
Provision for Credit Losses		5			375
Net Interest Income after Provision for Credit Losses		9,433			7,672

Noninterest Income:
Customer service fees		654			656
Increase in cash surrender value of bank-owned life insurance		139			132
Unrealized loss on fair value of marketable equity securities		(182	)		(60	)
Loss on fair value of junior subordinated debentures		(999	)		(1,033	)
Gain on sale of investment securities		30			—
Gain on sale of assets		—			13
Other		152			133
Total noninterest income (loss)		(206	)		(159	)

Noninterest Expense:
Salaries and employee benefits		3,049			3,024
Occupancy expense		780			856
Data processing		115			87
Professional fees		949			827
Regulatory assessments		231			166
Director fees		118			92
Correspondent bank service charges		25			19
Net cost on operation and sale of OREO		(8	)		25
Other		557			469
Total noninterest expense		5,816			5,565

Income Before Provision for Taxes		3,411			1,948
Provision for Taxes on Income		968			537
Net Income		2,443			1,411

Basic earnings per common share	$	0.14		$	0.08
Diluted earnings per common share	$	0.14		$	0.08
Weighted average basic shares for EPS		17,030,409			17,010,131
Weighted average diluted shares for EPS		17,051,819			17,026,752

United Security Bancshares
Average Balances and Rates (unaudited)
(in thousands)	Three Months Ended
	March 31, 2022			March 31, 2021
Average Balances:
Loans (1)	$	870,851		$	669,723
Investment securities		187,761			103,236
Interest-bearing deposits in FRB		177,243			258,918
Total interest-earning assets		1,235,855			1,031,877
Allowance for credit losses		(9,514	)		(8,507	)
Cash and due from banks		37,288			41,650
Other real estate owned		4,582			5,074
Other non-earning assets		65,384			60,641
Total average assets	$	1,333,595		$	1,130,735

Interest-bearing deposits	$	727,132		$	578,513
Junior subordinated debentures		11,156			10,896
Total interest-bearing liabilities		738,288			589,409

Noninterest-bearing deposits		466,062			412,455
Other liabilities		9,970			9,914
Total liabilities		1,214,320			1,011,778
Total equity		119,275			118,957
Total liabilities and equity	$	1,333,595		$	1,130,735

Average Rates:
Loans (1)		4.25	%		4.89	%
Investment securities		1.71	%		1.52	%
Interest-bearing deposits in FRB		0.19	%		0.10	%
Earning assets		3.28	%		3.35	%
Interest bearing deposits		0.28	%		0.30	%
Total deposits		0.17	%		0.17	%
Junior subordinated debentures		1.64	%		1.71	%
Total interest-bearing liabilities		0.30	%		0.33	%
Net interest margin (2)		3.10	%		3.16	%

(1) Loan amounts include nonaccrual loans, but the related interest income has been included only if collected for the period prior to the loan being placed on a nonaccrual basis.

(2) Net interest margin is computed by dividing annualized net interest income by average interest-earning assets.

United Security Bancshares
Condensed – Consolidated Balance Sheets (unaudited)
(in thousands)
	March 31, 2022			December 31, 2021			September 30, 2021			June 30, 2021			March 31, 2021
Cash and cash equivalents	$	224,934		$	219,219		$	259,428		$	160,908		$	307,909
Investment securities		183,527			182,646			165,508			170,767			147,340
Loans		879,379			871,533			809,114			842,049			674,489
Allowance for credit losses		(9,276	)		(9,333	)		(9,144	)		(9,200	)		(8,549	)
Net loans		870,103			862,200			799,970			832,849			665,940
Other assets		71,238			66,879			67,875			66,531			65,747
Total assets	$	1,349,802		$	1,330,944		$	1,292,781		$	1,231,055		$	1,186,936

Non-interest-bearing	$	465,043		$	476,749		$	455,584		$	442,140		$	429,005
Interest-bearing		749,289			711,357			695,131			648,302			618,776
Total deposits		1,214,332			1,188,106			1,150,715			1,090,442			1,047,781
Other liabilities		21,896			22,631			22,938			22,248			21,822
Total liabilities		1,236,228			1,210,737			1,173,653			1,112,690			1,069,603
Total shareholders’ equity		113,574			120,207			119,128			118,365			117,333
Total liabilities and shareholder’s equity	$	1,349,802		$	1,330,944		$	1,292,781		$	1,231,055		$	1,186,936

United Security Bancshares
Condensed – Consolidated Statements of Income (unaudited)
(in thousands)	For the Quarters Ended:
	March 31, 2022			December 31, 2021		September 30, 2021		June 30, 2021		March 31, 2021
Total interest income	$	9,991		$	9,930	$	9,877	$	9,404	$	8,520
Total interest expense		553			552		540		513		473
Net interest income		9,438			9,378		9,337		8,891		8,047
Provision for credit losses		5			453		453		826		375
Net interest income after provision for credit losses		9,433			8,925		8,884		8,065		7,672

Total non-interest (loss) income		(206	)		1,291		930		1,322		(159	)
Total non-interest expense		5,816			6,282		6,164		5,605		5,565
Income before provision for taxes		3,411			3,934		3,650		3,782		1,948
Provision for taxes on income		968			564		1,039		1,077		537
Net income	$	2,443		$	3,370	$	2,611	$	2,705	$	1,411

United Security Bancshares
Nonperforming Assets (unaudited)
(dollars in thousands)
	March 31, 2022			December 31, 2021
RE construction & development	$	11,147		$	11,226
Agricultural		183			212
Total nonaccrual loans	$	11,330		$	11,438

Loans past due 90 days and still accruing		—			453
Restructured loans		144			176
Total nonperforming loans	$	11,474		$	12,067
Other real estate owned		4,582			4,582
Total nonperforming assets	$	16,056		$	16,649

Nonperforming loans to total gross loans		1.31	%		1.39	%
Nonperforming assets to total assets		1.19	%		1.25	%
Allowance for credit losses to nonperforming loans		80.84	%		77.34	%

United Security Bancshares
Selected Financial Data (unaudited)
(dollars in thousands, except per share amounts)
	Three Months Ended March 31,
	2022		2021

Return on average assets	0.74	%	0.51	%
Return on average equity	8.33	%	4.82	%
Annualized net charge-off to average loans	0.03	%	0.21	%


	March 31, 2022		December 31, 2021
Shares outstanding – period end	17,034,407		17,028,239
Book value per share	$6.67		$7.06
Efficiency ratio (1)	63.00	%	58.89	%
Total impaired loans	$11,942		$12,034
Net loan to deposit ratio	71.65	%	72.57	%
Allowance for credit losses to total loans	1.06	%	1.07	%
Tier 1 capital to adjusted average assets (leverage)
Company	9.62	%	9.79	%
Bank	9.55	%	9.64	%

(1) Efficiency ratio is defined as total noninterest expense divided by net interest income before provision for credit losses plus total noninterest income.

United Security Bancshares
Net Income before Non-Core Reconciliation
Non-GAAP Information (dollars in thousands)
(unaudited)
	Three Months Ended March 31,
	2022			2021			Change $		Change %
Net income	$	2,443		$	1,411		$	1,032	73.1	%

Junior subordinated debenture (1) fair value adjustment		(999	)		(1,033	)

Income tax effect		290			300
Non-core items net of taxes		(709	)		(733	)

Non-GAAP core net income	$	3,152		$	2,144		$	1,008	47.0	%

(1) Junior subordinated debenture fair value adjustment is not part of Core Income and depending upon market rates, can “add to” or “subtract from” Core Income and mask Non-GAAP Core Income change.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220420006122/en/

Dennis Woods, President and CEO

559-248-4928

KEYWORDS: California United States North America

INDUSTRY KEYWORDS: Banking Professional Services Finance

MEDIA:

April 20, 2022 4:55 pm

Carvana Co. Announces Proposed Offering of Series A Preferred Stock

Carvana Co. Announces Proposed Offering of Series A Preferred Stock

PHOENIX–(BUSINESS WIRE)–
Carvana Co. (NYSE: CVNA), the leading e-commerce platform for buying and selling used cars, today announced its intention to offer, subject to market and other conditions, $1 billion of a new series of perpetual preferred stock, liquidation preference $1,000 per share (the “Series A Preferred Stock”) in a private offering only to (i) qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”) and (ii) non-U.S. persons outside the United States in offshore transactions in reliance on Regulation S under the Securities Act.

J.P. Morgan Securities LLC and Citigroup will act as book-running managers for the proposed Series A Preferred Stock private offering.

Holders of Series A Preferred Stock will be entitled to receive dividend payments only when, as and if declared by Carvana’s board of directors. Dividends will either be (a) payable in cash, if and to the extent declared by Carvana’s board of directors, or (b) added to the liquidation preference if not so declared. Dividends, if declared and paid in cash, will be payable on March 31, June 30, September 30 and December 31 (each, a “Quarter Date”) of each year beginning on June 30, 2022. Dividends, if not declared and paid in cash, will compound quarterly on each Quarter Date and be added to the liquidation preference. No dividend may be declared unless paid immediately in cash (it being understood that no dividends may be declared and paid in securities or otherwise “in kind”).

The dividend rate, redemption and other terms of the Series A Preferred Stock will be determined at the time of pricing of the offering.

The net proceeds of the Series A Preferred Stock private offering will, together with a proposed offering of a new series of unsecured senior notes due 2030 (the “New Notes”), be used to finance Carvana’s announced acquisition of the U.S. based physical auction business of ADESA, Inc., and they will also be used for working capital, capital expenditures and other general corporate purposes. The consummation of the private offering of the Series A Preferred Stock is not contingent upon the closing of the New Notes offering, and the New Notes offering is not contingent upon the closing of the private offering of the Series A Preferred Stock.

Carvana has also announced a public offering of $1 billion of Class A common stock pursuant to an effective registration statement and a preliminary prospectus supplement. Ernest Garcia, II, along with Ernie Garcia, III, Carvana’s Chief Executive Officer, and entities controlled by one or both of them, have indicated an interest in purchasing up to an aggregate of $432 million of the Company’s Class A common stock in the offering, based on their pro rata ownership. Carvana intends to use the net proceeds from the offering of Class A common stock for general corporate purposes.

This press release is not an offer to sell or a solicitation of an offer to buy the New Notes, any shares of Series A Preferred Stock or any shares of Class A common stock.

The Series A Preferred Stock has not been registered under the Securities Act or any securities laws of any jurisdiction and may not be offered or sold except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and such other securities laws. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the Series A Preferred Stock in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction. The Series A Preferred Stock will be offered only to (i) qualified institutional buyers in reliance on the exemption from registration provided by Rule 144A under the Securities Act and (ii) non-U.S. persons outside the United States in offshore transactions in reliance on Regulation S under the Securities Act. Offers of these securities have will be made only by means of a private offering memorandum.

About Carvana

Founded in 2012 and based in Phoenix, Carvana’s mission is to change the way people buy and sell cars. With a continued focus on its customers, technology and innovation, Carvana offers an intuitive and convenient online car buying, selling, and financing experience. Carvana.com enables customers to quickly and easily shop more than 71,000 vehicles, finance, trade in or sell their current vehicle to Carvana, sign contracts and schedule delivery or pickup at one of its patented, automated Car Vending Machines. Carvana is a Fortune 500 company, providing as-soon-as-next-day delivery to customers in over 300 U.S. markets.

Note Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect Carvana’s current intentions, expectations or beliefs regarding the proposed Series A Preferred Stock private offering, Class A common stock offering, and the proposed private offering of New Notes. There can be no guarantee Carvana will consummate any of the offerings on the proposed terms, if at all, or will consummate its proposed acquisition of the U.S. based physical auction business of ADESA, Inc. These statements may be preceded by, followed by or include the words “aim,” “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “intend,” “likely,” “outlook,” “plan,” “potential,” “project,” “projection,” “seek,” “can,” “could,” “may,” “should,” “would,” “will,” the negatives thereof and other words and terms of similar meaning. Forward-looking statements include all statements that are not historical facts. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. Among these factors are risks related to the “Risk Factors” identified in our Annual Report on Form 10-K for 2021. There is no assurance that any forward-looking statements will materialize. You are cautioned not to place undue reliance on forward-looking statements, which reflect expectations only as of this date. Carvana does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments, or otherwise, except as required by law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220420006062/en/

Investors

Mike Levin

[email protected]

Media

Kristin Thwaites

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KEYWORDS: Arizona United States North America

INDUSTRY KEYWORDS: Online Retail Retail Automotive General Automotive Technology Fleet Management Internet

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April 20, 2022 4:54 pm

Carvana Co. Announces Proposed Offering of Class A Common Stock

Carvana Co. Announces Proposed Offering of Class A Common Stock

PHOENIX–(BUSINESS WIRE)–
Carvana Co. (NYSE: CVNA), the leading e-commerce platform for buying and selling used cars, today announced its intention to offer, subject to market and other conditions, $1 billion of its Class A common stock in a public offering registered under the Securities Act of 1933, as amended (the “Securities Act”).

Ernest Garcia, II, along with Ernie Garcia, III, Carvana’s Chief Executive Officer, and entities controlled by one or both of them, have indicated an interest in purchasing up to an aggregate of $432 million of the Company’s Class A common stock in the offering, based on their pro rata ownership.

Citigroup and J.P. Morgan Securities LLC will act as book-running managers for the proposed offering.

Carvana intends to use the net proceeds from the public offering of Class A common stock for general corporate purposes.

Separately, Carvana is proposing to offer (x) up to $1 billion of series A perpetual preferred stock (the “Series A Preferred Stock”) and (y) up to $2.275 billion aggregate principal amount of senior unsecured notes due 2030 (the “New Notes”), in each case pursuant to a separate offering memorandum for each proposed offering only to (i) qualified institutional buyers in reliance on the exemption from registration provided by Rule 144A under the Securities Act and (ii) non-U.S. persons outside the United States in offshore transactions in reliance on Regulation S under the Securities Act. The net proceeds of the offerings are to be used to finance Carvana’s announced acquisition of the U.S. based physical auction business of ADESA, Inc., and they will also be used for working capital, capital expenditures and other general corporate purposes. This press release is not an offer to sell or a solicitation of an offer to buy the Series A Preferred Stock or the New Notes, and the offering of the Class A common stock is not contingent on the offering of the Series A Preferred Stock or the New Notes.

The offering of Class A common stock will be made only by means of an effective registration statement (including a prospectus), a preliminary prospectus supplement and a final prospectus supplement. A copy of the prospectus and the preliminary prospectus supplement and, when available, the final prospectus supplement relating to these securities may be obtained from Citigroup Global Markets Inc. c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, by telephone at (800) 831-9146 or J.P. Morgan Securities LLC c/o Broadridge Financial Solutions, 1155 Long Island Avenue, Edgewood, NY 11717, by telephone at (866) 803-9204, or by email at [email protected].

An automatic shelf registration statement relating to the Class A common stock has been filed with the U.S. Securities and Exchange Commission and is effective. This press release shall not constitute an offer to sell or a solicitation of an offer to buy the Class A common stock, nor shall there be any sale of these securities in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the applicable securities laws of such state or jurisdiction.

About Carvana

Note Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect Carvana’s current intentions, expectations or beliefs regarding the proposed Class A common stock offering, Series A Preferred Stock private offering and the proposed private offering of New Notes. There can be no guarantee Carvana will consummate any of the offerings on the proposed terms, if at all, or consummate its proposed acquisition of the U.S. based physical auction business of ADESA, Inc. These statements may be preceded by, followed by or include the words “aim,” “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “intend,” “likely,” “outlook,” “plan,” “potential,” “project,” “projection,” “seek,” “can,” “could,” “may,” “should,” “would,” “will,” the negatives thereof and other words and terms of similar meaning. Forward-looking statements include all statements that are not historical facts. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. Among these factors are risks related to the “Risk Factors” identified in our Annual Report on Form 10-K for 2021 and in the preliminary prospectus supplement for the proposed offering of Class A common stock. There is no assurance that any forward-looking statements will materialize. You are cautioned not to place undue reliance on forward-looking statements, which reflect expectations only as of this date. Carvana does not undertake any obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments, or otherwise, except as required by law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220420006058/en/

Investors

Mike Levin

[email protected]

Media

Kristin Thwaites

[email protected]

KEYWORDS: United States North America Arizona

INDUSTRY KEYWORDS: Online Retail Retail Automotive General Automotive Technology Specialty Internet

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April 20, 2022 4:51 pm

Marin Software Announces Date of First Quarter 2022 Financial Results Conference Call

PR Newswire

SAN FRANCISCO
, April 20, 2022 /PRNewswire/ — Marin Software Incorporated (NASDAQ: MRIN), a leading provider of digital marketing software for performance-driven advertisers and agencies, today announced that it will report financial results for the quarter ended March 31, 2022, after market close on Thursday, May 5. The company also announced that it will hold a conference call on the same day at 2:00 PM Pacific Time (5:00 PM Eastern Time) to discuss its quarterly financial results. This conference call may include forward-looking statements.

The conference call can be accessed by dialing (877) 704-4453 from the United States or +1 (201) 389-0920 internationally with conference ID 13728727, and a live webcast of the conference call can be accessed at https://services.choruscall.com/mediaframe/webcast.html?webcastid=1I1l517G.

Following the completion of the call through 11:59 PM Eastern Time on Thursday, May 12, 2022, a recorded replay will be available on the company’s website, and a telephone replay will be available by dialing (844) 512-2921 from the United States or +1 (412) 317-6671 internationally with recording access code 13728727.

About Marin Software
Marin Software Incorporated’s (NASDAQ: MRIN) mission is to give advertisers the power to drive higher efficiency and transparency in their paid marketing programs that run on the world’s largest publishers. Marin Software offers a unified SaaS advertising management platform for search, social, and eCommerce advertising. The Company helps digital marketers convert precise audiences, improve financial performance, and make better decisions. Headquartered in San Francisco with offices worldwide, Marin Software’s technology powers marketing campaigns around the globe. For more information about Marin Software, please visit www.marinsoftware.com.

View original content:https://www.prnewswire.com/news-releases/marin-software-announces-date-of-first-quarter-2022-financial-results-conference-call-301529608.html

SOURCE Marin Software

April 20, 2022 4:51 pm

Northern States Power Company-Minnesota Announces Redemption of 2.15% First Mortgage Bonds, Series due August 15, 2022

Northern States Power Company-Minnesota Announces Redemption of 2.15% First Mortgage Bonds, Series due August 15, 2022

MINNEAPOLIS–(BUSINESS WIRE)–
Northern States Power Company, a Minnesota corporation, announced today that it has submitted a redemption notice to The Depository Trust Company, as registered holder, to redeem all of its outstanding 2.15% First Mortgage Bonds, Series due August 15, 2022 (the “Bonds”) on May 20, 2022 (the “Redemption Date”). The redemption price for the Bonds will be equal to 100% of the principal amount being redeemed plus accrued and unpaid interest thereon to but excluding the Redemption Date. The aggregate principal amount of Bonds currently outstanding is $300,000,000.

This press release does not constitute a notice of redemption of the Bonds. Holders of the Bonds should refer to the notice of redemption to be delivered through The Depository Trust Company.

This press release is not an offer to sell or a solicitation of an offer to buy any securities.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220420006138/en/

Xcel Energy

Financial analysts:

Paul Johnson, 612-215-4535

Vice President, Treasurer & Investor Relations

or

News media inquiries:

Xcel Energy Media Relations, 612-215-5300

KEYWORDS: United States North America Minnesota Colorado

INDUSTRY KEYWORDS: Alternative Energy Energy Other Energy Utilities

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April 20, 2022 4:48 pm

Amerant Reports First Quarter 2022 Net Income of $16.0 Million or Diluted Earnings Per Share of $0.45

CORAL GABLES, Fla., April 20, 2022 (GLOBE NEWSWIRE) — Amerant Bancorp Inc. (NASDAQ: AMTB) (the “Company” or “Amerant”) today reported net income attributable to the Company of $16.0 million in the first quarter of 2022, or $0.45 per diluted share, a decrease compared to net income attributable to the Company of $65.5 million, or $1.77 per diluted share, in the fourth quarter of 2021, which included the sale of the Company’s headquarter building, and an increase compared to the net income attributable to the Company of $14.5 million, or $0.38 per diluted share, in the first quarter of 2021.

Core Pre-Provision Net Revenue (“Core PPNR”)¹ was $17.9 million in the first quarter of 2022, a decrease from $18.9 million in the fourth quarter of 2021, and an increase from $15.8 million in the first quarter of 2021. Return on assets (“ROA”) and return on equity (“ROE”) were 0.84% and 8.10%, respectively, in the first quarter of 2022, compared to 3.45% and 32.04%, respectively, in the fourth quarter of 2021, and 0.76% and 7.47%, respectively, in the first quarter of 2021.

¹Non-GAAP measure, see “Non-GAAP Financial Measures” for more information and Exhibit 2 for a reconciliation to GAAP.

Financial Highlights:

Total gross loans were $5.72 billion up $153.6 million, or 2.8%, compared to $5.57 billion in 4Q21; average yield increased to 4.16% in 1Q22 from 4.10% in 4Q21.
Sold $57.3 million in loans from NYC available for sale portfolio; $68.6 million in available for sale loans remain as of March 31, 2022. The NYC loan portfolio decreased to $373.0 million as of March 31, 2022, down by $118 million from December 31, 2021.

Total deposits as of 1Q22 were $5.69 billion, up $60.8 million compared to $5.63 billion in 4Q21.
Core deposits were $4.44 billion, up $150.4 million, or 3.5%, compared to 4Q21.
Average cost of total deposits decreased to 0.38% in 1Q22 from 0.41% in 4Q21.
Non-interest bearing to total deposits increased to 23.2% of total deposits compared to 21.0% for 4Q21.
Released $10.0 million from the allowance for loan losses (“ALL”) during the first quarter of 2022, compared to a release of $6.5 million in the fourth quarter of 2021.
Repaid $180.0 million in short-term FHLB advances and borrowed $350.0 million in longer-term advances to extend duration.
AUM totaled $2.13 billion, down $91.7 million, or 4.1%, from 4Q21, reflective of market decline in value.
Noninterest income was $14.0 million, down 81.9% from $77.3 million in 4Q21, as the fourth quarter of 2021 included a $62.4 million gain on the sale of the Company’s headquarters building.
Noninterest expense was $60.8 million, up 10.4% from $55.1 million in 4Q21, as the first quarter of 2022 included $6.6 million in non-recurring noninterest expense charges, including $4.0 million of estimated contract termination costs.

“We are pleased to report solid loan and deposit growth in the quarter, which reflects the increasing momentum we have toward achieving our end goal of becoming a top quartile performing community bank,” said Jerry Plush, Vice Chairman, President and CEO. “We continued to make significant progress in the transformation of Amerant. Our first quarter results reflect a number of non-recurring items, many of these resulting from positive steps taken to generate greater value for our shareholders in coming quarters.”

Significant Actions:

Changes in the Board of Directors, which included the appointment of four new board members, all of whom live in our footprint, and the retirement of two long-time board members.
Completed the private placement of $30 million of 4.25% fixed-to-floating rate subordinated notes due 2032, considered as tier 2 capital.
Repurchased a total of 1.6 million shares under authorized buyback programs.
Paid a cash dividend of $0.09 per share on February 28, 2022 and declared a $0.09 per share cash dividend on April 13, 2022 to be paid on May 31, 2022.
Reduced headcount by 80 FTEs as per our agreement with FIS; total bank only FTEs were 598 as of March 31, 2022.
Initiated the reorganization of lines of business to focus on commercial banking and consumer banking separately to drive performance in the geographies we serve.
Joined the USDF Consortium as the 7th bank to join the association formed to provide a base source for banks’ digital asset & blockchain strategies; continue to evaluate numerous fintech solutions.
Launched Employee Stock Purchase Program (“ESPP”), subject to shareholders approval at the Company’s Annual meeting.
Hired a new head of retail banking.
Entered into a multi-year agreement to drive our equipment financing business; this partnership provides an efficient white label solution to drive sales and provide underwriting capabilities.
Issued the Company’s first Environmental, Social and Governance (“ESG”) report on April 15, 2022 demonstrating its commitment to sustainability.
Announced a multi-year partnership with the University of Miami athletics, making Amerant the “Official Hometown Bank” of the Miami Hurricanes.

Summary Results

The summary results of the first quarter ended March 31, 2022 were as follows:

Net income attributable to Amerant was $16.0 million in the first quarter of 2022, down 75.6% from $65.5 million in the fourth quarter of 2021, and up 10.3% from $14.5 million in the first quarter of 2021. Core net income¹ was $22.2 million in the first quarter of 2022 compared to $19.3 million in the fourth quarter of 2021, and compared to core net income of $12.6 million in the first quarter of 2021.
Net Interest Income (“NII”) was $55.6 million, down 0.2% from $55.8 million in the fourth quarter of 2021, and up 17.0% from $47.6 million in the first quarter of 2021. Net interest margin (“NIM”) was 3.18% in the first quarter of 2022, up 1 basis point from 3.17% in the fourth quarter of 2021, and up 52 basis points from 2.66% in the first quarter of 2021.
Amerant released $10.0 million from the allowance for loan losses during the first quarter of 2022, compared to a release of $6.5 million in the fourth quarter of 2021. No provision for loan losses was recorded in the first quarter of 2021. The ratio of allowance for loan losses to total loans held for investment was 1% as of March 31, 2022, compared with 1.29% as of December 31, 2021, and 1.93% as of March 31, 2021. The ratio of net charge-offs to average total loans held for investment in the first quarter of 2022 was 0.29% compared to 0.52% in the fourth quarter of 2021, and zero net charge offs in the first quarter of 2021.
Non-interest income was $14.0 million in the first quarter of 2022, down 81.9% from $77.3 million in the fourth quarter of 2021, as the fourth quarter of 2021 included a $62.4 million gain on the sale of the Company’s headquarters building, and slightly down 1.0% from $14.2 million in the first quarter of 2021.
Non-interest expense was $60.8 million, up 10.4% from $55.1 million in the fourth quarter of 2021 and up 39.4% from $43.6 million in the first quarter of 2021, as the first quarter of 2022 included $6.6 million in non-recurring charges, inclusive of $4.0 million on estimated contract termination costs.
The efficiency ratio was 87.3% in the first quarter of 2022, compared to 41.4% in the fourth quarter of 2021, and 70.7% in the first quarter of 2021. Core efficiency ratio¹was 76.4% in the first quarter of 2022, compared to 75.0% in the fourth quarter of 2021, and 73.4% in the first quarter of 2021.
Total gross loans, which include loans held for sale, were $5.72 billion at the close of the first quarter of 2022, up $153.6 million, or 2.8%, compared to the close of the fourth quarter of 2021. Total deposits were $5.69 billion at the close of the first quarter of 2022, up by $60.8 million, or 1.08%, compared to the close of the fourth quarter of 2021, and slightly up by $13.6 million, or 0.2%, compared to the close of the first quarter 2021.
Stockholders’ book value per common share attributable to the Company was $21.82 at March 31, 2022, compared to $23.18 at December 31, 2021, and $20.70 at March 31, 2021. Tangible stockholders’ book value (“TBV”)¹ per common share was $21.15 as of March 31, 2022, compared to $22.55 at December 31, 2021, and $20.13 at March 31, 2021.

Credit Quality

The ALL was $56.1 million at the close of the first quarter of 2022, compared to $69.9 million at the close of the fourth quarter of 2021, and $110.9 million at the close of the first quarter of 2021. The Company released $10.0 million from the ALL in the first quarter of 2022, compared to a release of $6.5 million in the fourth quarter of 2021. No provision for loan losses was recorded in the first quarter of 2021. The ALL release during the first quarter of 2022 was primarily attributed to improved macro-economic conditions and loan upgrades, as well as payoffs and pay-downs of non-performing loans and special mention loans, partially offset by additional reserves requirements for charge-offs, loan growth and two loans downgraded to non-performing during the period. During the first quarter of 2022, the $14.1 million ALL associated with the COVID-19 pandemic was reduced to $4.9 million reflecting the improved macro-economic conditions, while still taking into account impact for supply chain disruptions, inflationary pressures and labor shortages prevalent in the current economic environment.

Net charge-offs during the first quarter of 2022 totaled $3.8 million, compared to $7.0 million in the fourth quarter of 2021 and zero net charge offs in the first quarter of 2021. Charge-offs during the period were primarily due to $3.3 million in two commercial loans and $1.0 million in consumer loans, offset by $0.5 million in recoveries.

Classified and special mention loans decreased 5.6% and 51.2%, respectively, compared to the fourth quarter of 2021, and decreased 46.9% and 67.0%, respectively, compared to the first quarter of 2021. The decrease in classified loans was primarily due to $12.9 million in payoffs. The decrease in special mention loans was primarily due to the upgrade of one CRE loan totaling $24.9 million.

Non-performing assets totaled $56.7 million at the end of the first quarter of 2022, a decrease of $2.8 million or 4.7%, compared to the fourth quarter of 2021, and $33.2 million, or 37.0%, compared to the first quarter of 2021, due to the decrease in classified loans as mentioned above. The ratio of non-performing assets to total assets at the end of the first quarter of 2022 was 73 basis points, down 5 basis points from 78 basis points in the fourth quarter of 2021 and 43 basis points from 116 basis points in the first quarter of 2021, respectively. In the first quarter of 2022, the ratio of ALL to non-performing loans decreased to 119.34%, from 140.41% at December 31, 2021 and decreased from 123.92% at the close of the first quarter of 2021.

Loans and Deposits

Total loans, including loans held for sale, as of March 31, 2022 were $5.72 billion, up $153.6 million, or 2.8%, compared to December 31, 2021. Loans held for sale totaled $85.7 million and $158.1 million as of March 31, 2022 and December 31, 2021, respectively. There were $1.0 million in loans held for sale in the first quarter of 2021. Loans held for sale include $17.1 million primarily in residential mortgage loans originated for sale, and $68.6 million New York loans held for sale. In the first quarter of 2022, the Company completed the sale of $57.3 million in loans held for sale related to the New York portfolio, at par value. Despite the sale of the NY portfolio and other recorded paydowns, net loan growth was driven by sales efforts in CRE and C&I during the quarter. This growth was also complemented with some purchases performed under the indirect lending program.

Total deposits as of March 31, 2022 were $5.69 billion, up $60.8 million, or 1.1%, compared to December 31, 2021. The quarter-over-quarter increase in total deposits was primarily attributable to an increase in customer transaction account balances of $198.1 million, or 4.7%, compared to December 31, 2021, with non-interest bearing deposits, interest-bearing demand and savings and money market growth contributing $135.0 million, $49.2 million and $13.8 million to such growth, respectively. Offsetting the increase in total deposits was a reduction of $89.6 million, or 6.7%, in time deposits. Customer CDs compared to the prior quarter decreased $97.2 million, or 9.3% as the Company continued to focus on increasing core deposits and emphasizing multi-product relationships versus single product higher-cost CDs. Brokered time deposits remain somewhat flat for the first quarter of 2021.

Core deposits, which consist of total deposits excluding all time deposits, as of March 31, 2022 were $4.4 billion, an increase of $150.4 million or 3.5%, compared to December 31, 2021, and $647.5 million, or 17.1% compared to March 31, 2021. The $4.4 billion in core deposits includes interest-bearing demand deposits of $1.5 billion and savings and money market deposits of $1.6 billion, which remained flat from December 31, 2021, as well as noninterest bearing demand deposits of $1.3 billion, which increased from $1.2 billion as of December 31, 2021. Domestic deposits totaled $3.2 billion, slightly up $42.9 million, or 1.4%, compared to December 31, 2021, while foreign deposits totaled $2.5 billion, slightly up $18.0 million, or 0.7%, compared to December 31, 2021, primarily driven by our efforts to grow deposits from customers in other countries other than Venezuela.

Net Interest Income and Net Interest Margin

First quarter 2022 NII was $55.6 million, flat from $55.8 million in the fourth quarter of 2021 and up $8.1 million, or 16.98%, from $47.6 million in the first quarter of 2021. NIM was 3.18% in the first quarter of 2022, up 1 basis point from 3.17% in the fourth quarter of 2021, and up 52 basis points from 2.66% in the first quarter of 2021. During the first quarter of 2022 the Company repaid $180.0 million in short-term FHLB advances and borrowed $350.0 million in longer-term advances to extend the duration of this portfolio. With these actions the Company effectively increased the duration of financial liabilities under a scenario of an imminent increase in interest rates.

The year-over-year increase in NII was primarily driven by higher average yields on loans and available for sale securities, lower average balances and rates on customer CDs, lower balances in brokered time deposits and lower money market deposit costs as well as lower balances in FHLB advances. Partially offsetting the year-over-year increase in NII were lower balances on loans and available for sale securities, as well as higher costs in interest bearing deposits, brokered time deposits, FHLB advances, and the cost of the new subordinated debt.

Noninterest income

In the first quarter of 2022, noninterest income was $14.0 million, down $63.3 million, or 81.9%, from $77.3 million in the fourth quarter of 2021. The decrease was primarily driven by the absence of the $62.4 million gain on the sale of the Company’s headquarters building recorded in the fourth quarter of 2021. Contributing to the decrease were also net losses on the early extinguishment of FHLB advances, lower income from brokerage, advisory and fiduciary activities, net unrealized losses on derivatives valuation, as well as decreased mortgage banking income. Record fee income from client derivatives as well as net securities gains partially offset the aforementioned decrease in noninterest income.

Noninterest income slightly decreased $0.1 million, or 0.97%, in the first quarter of 2022 from $14.2 million in the first quarter of 2021. The year-over-year decrease in noninterest income was primarily driven by lower net gains on securities and net losses on the early extinguishment of FHLB advances. The decrease was mostly offset by an increase in derivative client income, deposit and service fees and other income from mortgage banking.

During the first quarter of 2022, Amerant Mortgage (“AMTM”) solidified its wholesale team and launched its construction loan program to help drive future revenues. In the first quarter of 2022, AMTM received 292 applications and funded 156 loans totaling $91.1 million. Total mortgage loans held for sale were $17.1 million as of March 31, 2022. On March 31, 2022, the Company increased its ownership interest in AMTM from 51% to 57.4% to meet Fannie Mae’s required capital guidelines.

The Company’s assets under management and custody (“AUM”) totaled $2.1 billion as of March 31, 2022, decreasing $91.7 million, or 4.1%, from $2.2 billion as of December 31, 2021, and increasing $110.5 million, or 5.5% from $2.0 billion as of March 31, 2021. The quarter-over-quarter decrease in AUM was primarily driven by lower market valuations, though Amerant’s advisory portfolios performed relatively well compared to the overall market drop as the decrease in market value was partially offset by an increase of $12.1 million in net new assets.

The year-over-year increase in AUM was primarily driven by increased market value as well as net new assets of $114.7 million that were recorded in the last twelve months, attributed to the Company’s relationship-centric strategy.

Noninterest expense

First quarter of 2022 noninterest expense was $60.8 million, up $5.7 million, or 10.40%, from $55.1 million in the fourth quarter of 2021. The increase was primarily driven by estimated technology contract termination costs resulting from the upcoming transition to FIS supported systems and applications, as well as a valuation expense recorded on the change in fair value of NY loans held for sale. In addition, there were higher: (i) net rent expense related to the leasing of the Company’s headquarters building; (ii) advertising expenses related to build brand awareness; (iii) severance expenses in connection with the restructuring of business lines; and (iv) commissions paid primarily related to AMTM. These increases were partially offset by lower (i) salaries and variable compensation costs driven by a lower number of full-time-equivalent employees (“FTEs”) in 1Q22 compared to 4Q21 as a result of the Company’s agreement with FIS; (ii) legal fees; and (iii) depreciation and amortization expenses resulting from the sale of the Company’s headquarters building.

Noninterest expense in the first quarter of 2022, increased $17.2 million, or 39.4% compared to $43.6 million in the first quarter of 2021. The increase was primarily driven by the aforementioned reasons as well as higher total salaries and employee benefits primarily driven by higher long term incentive plan expenses, salaries and variable compensation as well as severance expenses; (ii) professional and other service fees primarily in connection with customer derivative transactions and services received from FIS, as well as the onboarding of the new firm as a result of outsourcing of the Company’s internal audit function.

In the first quarter of 2022, AMTM had noninterest expenses totaling $3.5 million, which includes $2.6 million in salaries and employee benefits, $0.9 million in residential mortgage loan operations, professional fees and other noninterest expenses.

The efficiency ratio was 87.29% in the first quarter of 2022, compared to 41.40% in the fourth quarter of 2021, and 70.67% in the first quarter of 2021. The quarter-over-quarter increase in the efficiency ratio was primarily driven by the absence of the gain on sale of the Company’s headquarters building recorded in the fourth quarter of 2021. The year-over-year increase in the efficiency ratio was primarily due to higher noninterest expenses as noted above. Core efficiency ratio¹ increased to 76.36% in the first quarter of 2022 compared to 74.98% in the fourth quarter of 2021 and 73.35% in the first quarter of 2021, primarily driven by higher rent expense, advertising expenses and commissions paid, as previously described.

Amerant continues to work on increasing operating efficiencies. As of March 31, 2022, total FTEs reached 677 compared to 763 on December 31, 2021, primarily as a result of the Company’s agreement with FIS. Also, the Company is focused on further strengthening its business structure as evidenced by the larger percentage of team members in business generation roles than in support functions.

Capital Resources and Liquidity

The Company’s capital continues to be strong and well in excess of the minimum regulatory requirements to be considered “well-capitalized” at March 31, 2022.

Stockholders’ equity attributable to the Company totaled $749.4 million as of March 31, 2022, down $82.5 million, or 9.9%, from $831.9 million as of December 31, 2021, primarily driven by: (i) an aggregate of $54.8 million of Class A common stock repurchased in the first quarter of 2022, under the Class A repurchase programs launched in 2021 and 2022; (ii) an after-tax unrealized loss of $39.7 million in the market value of debt securities available for sale as a result of the increase of more than 100 basis points recorded in long term interest rates; and (iii) $3.2 million of dividends declared and paid by the Company in the first quarter of 2022. These decreases were partially offset by net income of $16.0 million in the first quarter of 2022.

Book value per common share decreased to $21.82 at March 31, 2022 compared to $23.18 at December 31, 2021 primarily driven by the unrealized loss of $39.7 million in the fair value of debt securities available for sale, which more than offset share repurchases and net income during the first quarter of 2022. TBV¹per common share decreased to $21.15 at March 31, 2022 compared to $22.55 at December 31, 2021.

Amerant’s liquidity position includes cash and cash equivalents of $276.2 million at the close of the first quarter of 2022, compared to $274.2 million as of December 31, 2021. Additionally, as of the end of the first quarter of 2022 and the fourth quarter of 2021 the Company, through its subsidiary Amerant Bank, had $1.3 billion and $1.4 billion, respectively, in available borrowing capacity with the FHLB.

¹Non-GAAP measure, see “Non-GAAP Financial Measures” for more information and Exhibit 2 for a reconciliation to GAAP.

First Quarter 2022 Earnings Conference Call

The Company will hold an earnings conference call on Thursday, April 21, 2022 at 9:00 a.m. (Eastern Time) to discuss its first quarter 2022 results. The conference call and presentation materials can be accessed via webcast by logging on from the Investor Relations section of the Company’s website at https://investor.amerantbank.com. The online replay will remain available for approximately one month following the call through the above link.

About Amerant Bancorp Inc. (NASDAQ: AMTB)

Amerant Bancorp Inc. is a bank holding company headquartered in Coral Gables, Florida since 1979. The Company operates through its main subsidiary, Amerant Bank, N.A. (the “Bank”), as well as its other subsidiaries: Amerant Investments, Inc., Elant Bank and Trust Ltd., and Amerant Mortgage, LLC. The Company provides individuals and businesses in the U.S., as well as select international clients, with deposit, credit and wealth management services. The Bank, which has operated for over 40 years, is the second largest community bank headquartered in Florida. The Bank operates 24 banking centers – 17 in South Florida and 7 in the Houston, Texas area. For more information, visit investor.amerantbank.com.

FIS® and any associated brand names/logos are the trademarks of FIS and/or its affiliates.

Cautionary Notice Regarding Forward-Looking Statements

This press release contains “forward-looking statements” including statements including statements with respect to the Company’s objectives, expectations and intention with respect to the Company’s objectives, expectations and intentions and other statements that are not historical facts. All statements other than statements of historical fact are statements that could be forward-looking statements. You can identify these forward-looking statements through our use of words such as “may,” “will,” “anticipate,” “assume,” “should,” “indicate,” “would,” “believe,” “contemplate,” “expect,” “estimate,” “continue,” “plan,” “point to,” “project,” “could,” “intend,” “target,” “goals,” “outlooks,” “modeled,” “dedicated,” “create,” and other similar words and expressions of the future.

Forward-looking statements, including those relating to our beliefs, plans, objectives, goals, expectations, anticipations, estimates and intentions, involve known and unknown risks, uncertainties and other factors, which may be beyond our control, and which may cause the Company’s actual results, performance, achievements, or financial condition to be materially different from future results, performance, achievements, or financial condition expressed or implied by such forward-looking statements. You should not rely on any forward-looking statements as predictions of future events. You should not expect us to update any forward-looking statements, except as required by law. All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary notice, together with those risks and uncertainties described in “Risk factors” in our annual report on Form 10-K for the fiscal year ended December 31, 2021 and in our other filings with the U.S. Securities and Exchange Commission (the “SEC”), which are available at the SEC’s website www.sec.gov.

Interim Financial Information

Unaudited financial information as of and for interim periods, including the three months ended March 31, 2022 and 2021, may not reflect our results of operations for our fiscal year ending, or financial condition as of December 31, 2022, or any other period of time or date.

Non-GAAP Financial Measures

The Company supplements its financial results that are determined in accordance with accounting principles generally accepted in the United States of America (“GAAP”) with non-GAAP financial measures, such as “pre-provision net revenue (PPNR)”, “core pre-provision net revenue (Core PPNR)”, “core net income (loss)”, “core net income (loss) per share (basic and diluted)”, “core return on assets (Core ROA)”, “core return on equity (Core ROE)”, “core efficiency ratio”, and “tangible stockholders’ equity (book value) per common share”. This supplemental information is not required by, or is not presented in accordance with GAAP. The Company refers to these financial measures and ratios as “non-GAAP financial measures” and they should not be considered in isolation or as a substitute for the GAAP measures presented herein.

We use certain non-GAAP financial measures, including those mentioned above, both to explain our results to shareholders and the investment community and in the internal evaluation and management of our businesses. Our management believes that these non-GAAP financial measures and the information they provide are useful to investors since these measures permit investors to view our performance using the same tools that our management uses to evaluate our past performance and prospects for future performance, especially in light of the additional costs we have incurred in connection with the Company’s restructuring activities that began in 2018 and continued in 2022, including the effect of non-core banking activities such as the sale of loans and securities, the valuation of securities, derivatives and loans held for sale, the sale of our corporate headquarters in the fourth quarter of 2021, and other non-recurring actions intended to improve customer service and operating performance. While we believe that these non-GAAP financial measures are useful in evaluating our performance, this information should be considered as supplemental and not as a substitute for or superior to the related financial information prepared in accordance with GAAP. Additionally, these non-GAAP financial measures may differ from similar measures presented by other companies.

Exhibit 2 reconciles these non-GAAP financial measures to reported results.

Exhibit 1- Selected Financial Information

The following table sets forth selected financial information derived from our unaudited and audited consolidated financial statements.

(in thousands)	March 31, 2022		December 31, 2021		September 30, 2021		June 30, 2021		March 31, 2021
Consolidated Balance Sheets
Total assets	$	7,805,836	$	7,638,399	$	7,489,305	$	7,532,844	$	7,751,098
Total investments		1,324,969		1,341,241		1,422,738		1,359,240		1,375,292
Total gross loans (1)		5,721,177		5,567,540		5,478,924		5,608,548		5,754,838
Allowance for loan losses		56,051		69,899		83,442		104,185		110,940
Total deposits		5,691,701		5,630,871		5,626,377		5,674,908		5,678,079
Core deposits (2)		4,443,414		4,293,031		4,183,587		4,041,867		3,795,949
Advances from the FHLB and other borrowings		980,047		809,577		809,095		808,614		1,050,000
Senior notes		58,973		58,894		58,815		58,736		58,656
Subordinated notes (3)		29,156		—		—		—		—
Junior subordinated debentures		64,178		64,178		64,178		64,178		64,178
Stockholders’ equity (4)(5)(6)(7)		749,396		831,873		812,662		799,068		785,014
Assets under management and custody (8)		2,129,387		2,221,077		2,188,317		2,132,516		2,018,870

	Three Months Ended
(in thousands, except percentages and per share amounts)	March 31, 2022			December 31, 2021			September 30, 2021			June 30, 2021			March 31, 2021
Consolidated Results of Operations
Net interest income	$	55,645		$	55,780		$	51,821		$	49,971		$	47,569
(Reversal of) provision for loan losses		(10,000	)		(6,500	)		(5,000	)		(5,000	)		—
Noninterest income		14,025			77,290			13,434			15,734			14,163
Noninterest expense		60,818			55,088			48,404			51,125			43,625
Net income attributable to Amerant Bancorp Inc. (9)		15,950			65,469			17,031			15,962			14,459
Effective income tax rate		21.10	%		23.88	%		24.96	%		22.65	%		20.15	%

Common Share Data
Stockholders’ book value per common share	$	21.82		$	23.18		$	21.68		$	21.27		$	20.70
Tangible stockholders’ equity (book value) per common share (10)	$	21.15		$	22.55		$	21.08		$	20.67		$	20.13
Basic earnings per common share	$	0.46		$	1.79		$	0.46		$	0.43		$	0.38
Diluted earnings per common share (11)	$	0.45		$	1.77		$	0.45		$	0.42		$	0.38
Basic weighted average shares outstanding		34,820			36,607			37,134			37,330			37,618
Diluted weighted average shares outstanding (11)		35,114			37,065			37,518			37,693			37,846
Cash dividend declared per common share (7)	$	0.09		$	0.06		$	—		$	—		$	—

	Three Months Ended
	March 31, 2022		December 31, 2021		September 30, 2021		June 30, 2021		March 31, 2021
Other Financial and Operating Data (12)

Profitability Indicators (%)
Net interest income / Average total interest earning assets (NIM) (13)	3.18	%	3.17	%	2.94	%	2.81	%	2.66	%
Net income / Average total assets (ROA) (14)	0.84	%	3.45	%	0.90	%	0.83	%	0.76	%
Net income / Average stockholders’ equity (ROE) (15)	8.10	%	32.04	%	8.38	%	8.11	%	7.47	%
Noninterest income / Total revenue (16)	20.13	%	58.08	%	20.59	%	23.95	%	22.94	%

Capital Indicators (%)
Total capital ratio (17)	13.80	%	14.56	%	14.53	%	14.17	%	14.12	%
Tier 1 capital ratio (18)	12.48	%	13.45	%	13.28	%	12.92	%	12.87	%
Tier 1 leverage ratio (19)	10.67	%	11.52	%	11.18	%	10.75	%	10.54	%
Common equity tier 1 capital ratio (CET1) (20)	11.55	%	12.50	%	12.31	%	11.95	%	11.90	%
Tangible common equity ratio (21)	9.34	%	10.63	%	10.58	%	10.35	%	9.88	%

Asset Quality Indicators (%)
Non-performing assets / Total assets (22)	0.73	%	0.78	%	1.24	%	1.61	%	1.16	%
Non-performing loans / Total loans (1) (23)	0.82	%	0.89	%	1.51	%	2.16	%	1.56	%
Allowance for loan losses / Total non-performing loans	119.34	%	140.41	%	100.84	%	86.02	%	123.92	%
Allowance for loan losses / Total loans held for investment (1)	0.99	%	1.29	%	1.59	%	1.86	%	1.93	%
Net charge-offs / Average total loans held for investment (24)	0.29	%	0.52	%	1.16	%	0.12	%	—	%

Efficiency Indicators (% except FTE)
Noninterest expense / Average total assets	3.20	%	2.90	%	2.55	%	2.67	%	2.28	%
Salaries and employee benefits / Average total assets	1.60	%	1.65	%	1.53	%	1.61	%	1.38	%
Other operating expenses/ Average total assets (25)	1.60	%	1.25	%	1.02	%	1.06	%	0.90	%
Efficiency ratio (26)	87.29	%	41.40	%	74.18	%	77.80	%	70.67	%
Full-Time-Equivalent Employees (FTEs) (27)	677		763		733		719		731

	Three Months Ended
(in thousands, except percentages and per share amounts)	March 31, 2022			December 31, 2021			September 30, 2021			June 30, 2021			March 31, 2021
Core Selected Consolidated Results of Operations and Other Data (10)

Pre-provision net revenue (PPNR)	$	9,928		$	79,141		$	17,485		$	15,397		$	18,107
Core pre-provision net revenue (Core PPNR)	$	17,869		$	18,911		$	18,297		$	16,934		$	15,765
Core net income	$	22,216		$	19,339		$	17,669		$	17,199		$	12,589
Core basic earnings per common share		0.64			0.53			0.48			0.46			0.33
Core earnings per diluted common share (11)		0.63			0.52			0.47			0.46			0.33
Core net income / Average total assets (Core ROA) (14)		1.17	%		1.02	%		0.93	%		0.90	%		0.66	%
Core net income / Average stockholders’ equity (Core ROE) (15)		11.28	%		9.46	%		8.69	%		8.74	%		6.50	%
Core efficiency ratio (28)		76.36	%		74.98	%		72.95	%		74.45	%		73.35	%

__________________
(1)	Total gross loans include loans held for investment net of unamortized deferred loan origination fees and costs. In addition, at March 31, 2022, December 31, 2021, September 30, 2021 and March 31, 2021, total loans include $68.6 million, $143.2 million, $219.1 million and $1.0 million, respectively, in loans held for sale carried at the lower of cost or estimated fair value. During the first quarter of 2022 and the fourth quarter of 2021, the Company sold approximately $57.3 million and $49.4 million, respectively, in loans held for sale carried at the lower of cost or estimated fair value related to the NY portfolio. In addition, as of March 31, 2022, December 31, 2021, September 30, 2021 and June 30, 2021, total loans include $17.1 million, $14.9 million, $5.8 million and $1.8 million, respectively, primarily in mortgage loans held for sale carried at fair value.
(2)	Core deposits consist of total deposits excluding all time deposits.
(3)	On March 9, 2022, the Company completed a $30.0 million offering of subordinated notes with at 4.50% fixed-to-floating rate and due in March 15, 2032 (the “Subordinated Notes”). The Subordinated Notes will initially bear interest at a fixed rate of 4.25% per annum, from and including March 9, 2022, to but excluding March 15, 2027, with interest payable semi-annually in arrears. From and including March 15, 2027, to but excluding the stated maturity date or early redemption date, the interest rate will reset quarterly to an annual floating rate equal to the then-current benchmark rate, which will initially be the three-month Secured Overnight Financing Rate (“SOFR”) plus 251 basis points, with interest during such period payable quarterly in arrears. If three-month SOFR cannot be determined during the applicable floating rate period, a different index will be determined and used in accordance with the terms of the Notes. Subordinated notes are presented net of direct issuance costs which are deferred and amortized over 10 years. The Subordinated Notes have been structured to qualify as Tier 2 capital of the Company for regulatory capital purposes, and rank equally in right of payment to all of our existing and future subordinated indebtedness.
(4)	In the first quarter of 2022, the Company repurchased an aggregate of 652,118 shares of Class A common stock at a weighted average price of $33.96 per share, under the Class A common stock repurchase program launched in 2021 (the “Class A Common Stock Repurchase Program”). The aggregate purchase price for these transactions was approximately $22.1 million, including transaction costs. On January 31, 2022, the Company announced the completion of the Class A Common Stock repurchase program. In addition, in the first quarter of 2022, the Company announced the launching of a new repurchase program pursuant to which the Company may purchase, from time to time, up to an aggregate amount of $50 million of its shares of Class A common stock (the “New Class A Common Stock Repurchase Program”). In the first quarter of 2022, the Company repurchased an aggregate of 991,362 shares of Class A common stock at a weighted average price of $32.96 per share, under the new Class A Common Stock Repurchase Program. The aggregate purchase price for these transactions was approximately $32.7 million, including transaction costs. As of April 6, 2022, the Company has repurchased an additional 121,146 shares of Class A common stock at weighted average price of $31.02 under the New Class A Common Stock Repurchase Program. The aggregate purchase price for these transactions was approximately $3.8 million, including transaction costs.
(5)	In the fourth quarter of 2021, the Company’s shareholders approved a clean-up merger, previously announced by the Company, pursuant to which a subsidiary of the Company merged with and into the Company (the “Merger”). Under the terms of the Merger, each outstanding share of Class B common stock was converted to 0.95 of a share of Class A common stock. In addition, any shareholder who owned fewer than 100 shares of Class A common stock upon completion of the Merger, received cash in lieu of Class A common stock. There were no authorized or outstanding Class B common stock at December 31, 2021. Furthermore, in connection with the Merger, the Company’s Board of Directors authorized the Class A Common Stock Repurchase Program which provided for the potential to repurchase up to $50 million of shares of Class A common stock. In the fourth quarter of 2021, the Company repurchased an aggregate of 1,175,119 shares of Class A common stock for an aggregate purchase price of $36.3 million, including $27.9 million repurchased under the Class A Common Stock Repurchase Program and $8.5 million shares cashed out in accordance with the terms of the Merger. The total weighted average market price of these transactions was $30.92 per share.
(6)	On March 10, 2021, the Company’s Board of Directors approved a stock repurchase program which provided for the potential repurchase of up to $40 million of shares of the Company’s Class B common stock (the “ Class B Common Stock Repurchase Program”). In the third, second and first quarters of 2021, the Company repurchased an aggregate of 63,000, 386,195 and 116,037 shares of Class B common stock, respectively, at a weighted average price per share of $18.55, $16.62 and $15.98, respectively, under the Class B Common Stock Repurchase Program. In the third quarter of 2021, the Company’s Board of Directors terminated the Class B Common Stock Repurchase Program.
(7)	In the first quarter of 2022 and fourth quarter of 2021, the Company’s Board of Directors declared a cash dividend of $0.09 per share of the Company’s common stock and $0.06 per share of the Company’s common stock, respectively. The dividend declared in the first quarter of 2022 was paid on February 28, 2022 to shareholders of record at the close of business on February 11, 2022. The dividend declared in the fourth quarter of 2021 was paid on or before January 15, 2022 to holders of record as of December 22, 2021. The aggregate amount paid in connection with these dividends in the first quarter of 2022 and the fourth quarter of 2021 was $3.2 million and $2.2 million, respectively.
(8)	Assets held for clients in an agency or fiduciary capacity which are not assets of the Company and therefore are not included in the consolidated financial statements.
(9)	In the three months ended March 31, 2022, December 31, 2021, September 30, 2021 and June 30, 2021, net income exclude losses of $1.1 million, $1.2 million, $0.6 million, $0.8 million, respectively, attributable to a 49% minority interest of Amerant Mortgage LLC. There was no minority interest at March 31, 2021. Beginning March 31, 2022, the minority interest share changed from 49% to 42.6%. This change had no impact to the Company’s financial condition or results of operations as of and for the first quarter ended March 31, 2022.
(10)	This presentation contains adjusted financial information determined by methods other than GAAP. This adjusted financial information is reconciled to GAAP in Exhibit 2 – Non-GAAP Financial Measures Reconciliation.
(11)	In all the periods shown, potential dilutive instruments consisted of unvested shares of restricted stock, restricted stock units and performance share units. For all other periods presented, potential dilutive instruments were included in the diluted earnings per share computation because, when the unamortized deferred compensation cost related to these shares was divided by the average market price per share in those periods, fewer shares would have been purchased than restricted shares assumed issued. Therefore, in those periods, such awards resulted in higher diluted weighted average shares outstanding than basic weighted average shares outstanding, and had a dilutive effect in per share earnings.
(12)	Operating data for the periods presented have been annualized.
(13)	NIM is defined as NII divided by average interest-earning assets, which are loans, securities, deposits with banks and other financial assets which yield interest or similar income.
(14)	Calculated based upon the average daily balance of total assets.
(15)	Calculated based upon the average daily balance of stockholders’ equity.
(16)	Total revenue is the result of net interest income before provision for loan losses plus noninterest income.
(17)	Total stockholders’ equity divided by total risk-weighted assets, calculated according to the standardized regulatory capital ratio calculations.
(18)	Tier 1 capital divided by total risk-weighted assets. Tier 1 capital is composed of Common Equity Tier 1 (CET1) capital plus outstanding qualifying trust preferred securities of $62.3 million at each of all the dates presented.
(19)	Tier 1 capital divided by quarter to date average assets.
(20)	CET1 capital divided by total risk-weighted assets.
(21)	Tangible common equity is calculated as the ratio of common equity less goodwill and other intangibles divided by total assets less goodwill and other intangible assets. Other intangible assets consist of, among other things, mortgage servicing rights and are included in other assets in the Company’s consolidated balance sheets.
(22)	Non-performing assets include all accruing loans past due by 90 days or more, all nonaccrual loans, restructured loans that are considered “troubled debt restructurings” or “TDRs”, and OREO properties acquired through or in lieu of foreclosure.
(23)	Non-performing loans include all accruing loans past due by 90 days or more, all nonaccrual loans and restructured loans that are considered TDRs.
(24)	Calculated based upon the average daily balance of outstanding loan principal balance net of unamortized deferred loan origination fees and costs, excluding the allowance for loan losses. During the first quarter of 2022, and the fourth, third and second quarters of 2021, there were net charge offs of $3.8 million, $7.0 million, $15.7 million, $1.8 million and $5.9 million, respectively. In the first quarter of 2021, there were zero net charge offs. During the first quarter of 2022, the Company charged-off $3.3 million in two commercial loans, including $2.5 million related to a nonaccrual loan paid off during the period. During the fourth quarter of 2021, the Company charged-off an aggregate of $4.2 million related to various commercial loans and $1.8 million related to one real estate loan. During the third quarter of 2021, the Company charged-off $5.7 million against the allowance for loan losses as result of the deterioration of one commercial loan relationship.
(25)	Other operating expenses is the result of total noninterest expense less salary and employee benefits.
(26)	Efficiency ratio is the result of noninterest expense divided by the sum of noninterest income and NII.
(27)	As of March 31, 2022, December 31, 2021, September 30, 2021 and June 30, 2021, includes 79, 72, 52 and 38 FTEs for Amerant Mortgage LLC, respectively. In addition, effective January 1, 2022, there were 80 employees who are no longer working for the Company as a result of the new agreement with Fidelity National Information Services, Inc.(“FIS”).
(28)	Core efficiency ratio is the efficiency ratio less the effect of restructuring costs and other adjustments, described in Exhibit 2 – Non-GAAP Financial Measures Reconciliation.

Exhibit 2- Non-GAAP Financial Measures Reconciliation

The following table sets forth selected financial information derived from the Company’s interim unaudited and annual audited consolidated financial statements, adjusted for certain costs incurred by the Company in the periods presented related to tax deductible restructuring costs, provision for (reversal of) loan losses, provision for income tax expense (benefit), the effect of non-core banking activities such as the sale of loans and securities, the valuation of securities, derivatives and loans held for sale, the sale and leaseback of our corporate headquarters in the fourth quarter of 2021, and other non-recurring actions intended to improve customer service and operating performance. The Company believes these adjusted numbers are useful to understand the Company’s performance absent these transactions and events.

	Three Months Ended,
(in thousands)	March 31, 2022			December 31, 2021			September 30, 2021			June 30, 2021			March 31, 2021


Net income attributable to Amerant Bancorp Inc.	$	15,950		$	65,469		$	17,031		$	15,962		$	14,459
Plus: (reversal of) provision for loan losses		(10,000	)		(6,500	)		(5,000	)		(5,000	)		—
Plus: provision for income tax expense (1)		3,978			20,172			5,454			4,435			3,648
Pre-provision net revenue (PPNR)		9,928			79,141			17,485			15,397			18,107
Plus: non-routine noninterest expense items		6,574			1,895			758			4,164			240
Less: non-routine noninterest income items		1,367			(62,125	)		54			(2,627	)		(2,582	)
Core pre-provision net revenue (Core PPNR)	$	17,869		$	18,911		$	18,297		$	16,934		$	15,765

Total noninterest income	$	14,025		$	77,290		$	13,434		$	15,734		$	14,163
Less: Non-routine noninterest income items:
Less: gain on sale of Headquarters building (1)		—			62,387			—			—			—
Derivatives losses, net		(1,345	)		—			—			—			—
Securities gains (losses), net		769			(117	)		(54	)		1,329			2,582
Loss on early extinguishment of FHLB advances, net		(714	)		—			—			(2,488	)		—
(Loss) gain on sale of loans		(77	)		(145	)		—			3,786			—
Total non-routine noninterest income items	$	(1,367	)	$	62,125		$	(54	)	$	2,627		$	2,582
Core noninterest income	$	15,392		$	15,165		$	13,488		$	13,107		$	11,581

Total noninterest expenses	$	60,818		$	55,088		$	48,404		$	51,125		$	43,625
Less: non-routine noninterest expense items
Restructuring costs (2):
Staff reduction costs (3)		765			26			250			3,322			6
Contract termination costs (4)		4,012			—			—			—			—
Legal and Consulting fees (5)		1,246			1,277			412			—			—
Digital transformation expenses		45			50			96			32			234
Lease impairment charge		14			—			—			810			—
Branch closure expenses (6)		33			542			—			—			—
Total restructuring costs	$	6,115		$	1,895		$	758		$	4,164		$	240
Other non-routine noninterest expense items:
Loans held for sale valuation expense (7)		459			—			—			—			—
Total non-routine noninterest expense items	$	6,574		$	1,895		$	758		$	4,164		$	240
Core noninterest expenses	$	54,244		$	53,193		$	47,646		$	46,961		$	43,385



(in thousands, except percentages and per share amounts)	March 31, 2022			December 31, 2021			September 30, 2021			June 30, 2021			March 31, 2021
Net income attributable to Amerant Bancorp Inc.	$	15,950		$	65,469		$	17,031		$	15,962		$	14,459
Plus after-tax non-routine items in noninterest expense:
Non-routine items in noninterest expense before income tax effect		6,574			1,895			758			4,164			240
Income tax effect (8)		(1,387	)		(478	)		(229	)		(897	)		(48	)
Total after-tax non-routine items in noninterest expense		5,187			1,417			529			3,267			192
Plus after-tax non-routine items in noninterest income:
Non-routine items in noninterest income before income tax effect		1,367			(62,125	)		54			(2,627	)		(2,582	)
Income tax effect (8)		(288	)		14,578			55			597			520
Total after-tax non-routine items in noninterest income		1,079			(47,547	)		109			(2,030	)		(2,062	)
Core net income	$	22,216		$	19,339		$	17,669		$	17,199		$	12,589

Basic earnings per share	$	0.46		$	1.79		$	0.46		$	0.43		$	0.38
Plus: after tax impact of non-routine items in noninterest expense		0.15			0.04			0.02			0.09			0.01
Less: after tax impact of non-routine items in noninterest income		0.03			(1.30	)		—			(0.06	)		(0.06	)
Total core basic earnings per common share	$	0.64		$	0.53		$	0.48		$	0.46		$	0.33

Diluted earnings per share (9)	$	0.45		$	1.77		$	0.45		$	0.42		$	0.38
Plus: after tax impact of non-routine items in noninterest expense		0.15			0.04			0.02			0.09			0.01
Less: after tax impact of non-routine items in noninterest income		0.03			(1.29	)		—			(0.05	)		(0.06	)
Total core diluted earnings per common share	$	0.63		$	0.52		$	0.47		$	0.46		$	0.33

Net income / Average total assets (ROA)		0.84	%		3.45	%		0.90	%		0.83	%		0.76	%
Plus: after tax impact of non-routine items in noninterest expense		0.27	%		0.07	%		0.02	%		0.17	%		0.01	%
Less: after tax impact of non-routine items in noninterest income		0.06	%	(2.50)%				0.01	%	(0.10)%			(0.11)%
Core net income / Average total assets (Core ROA)		1.17	%		1.02	%		0.93	%		0.90	%		0.66	%

Net income / Average stockholders’ equity (ROE)		8.10	%		32.04	%		8.38	%		8.11	%		7.47	%
Plus: after tax impact of non-routine items in noninterest expense		2.63	%		0.69	%		0.26	%		1.66	%		0.10	%
Less: after tax impact of non-routine items in noninterest income		0.55	%	(23.27)%				0.05	%	(1.03)%			(1.07)%
Core net income / Average stockholders’ equity (Core ROE)		11.28	%		9.46	%		8.69	%		8.74	%		6.50	%

Efficiency ratio		87.29	%		41.40	%		74.18	%		77.81	%		70.67	%
Less: impact of non-routine items in noninterest expense	(9.43)%			(1.43)%			(1.16)%			(6.34)%			(0.39)%
Plus: impact of non-routine items in noninterest income	(1.50)%				35.01	%	(0.07)%				2.98	%		3.07	%
Core efficiency ratio		76.36	%		74.98	%		72.95	%		74.45	%		73.35	%

	Three Months Ended,
(in thousands, except percentages, share data and per share amounts)	March 31, 2022			December 31, 2021			September 30, 2021			June 30, 2021			March 31, 2021

Stockholders’ equity	$	749,396		$	831,873		$	812,662		$	799,068		$	785,014
Less: goodwill and other intangibles (10)		(22,795	)		(22,528	)		(22,529	)		(22,505	)		(21,515	)
Tangible common stockholders’ equity	$	726,601		$	809,345		$	790,133		$	776,563		$	763,499
Total assets		7,805,836			7,638,399			7,489,305			7,532,844			7,751,098
Less: goodwill and other intangibles (10)		(22,795	)		(22,528	)		(22,529	)		(22,505	)		(21,515	)
Tangible assets	$	7,783,041		$	7,615,871		$	7,466,776		$	7,510,339		$	7,729,583
Common shares outstanding		34,350,822			35,883,320			37,487,339			37,562,792			37,921,961
Tangible common equity ratio		9.34	%		10.63	%		10.58	%		10.34	%		9.88	%
Stockholders’ book value per common share	$	21.82		$	23.18		$	21.68		$	21.27		$	20.70
Tangible stockholders’ book value per common share	$	21.15		$	22.55		$	21.08		$	20.67		$	20.13

____________
(1)	The Company sold its Coral Gables headquarters for $135 million, with an approximate carrying value of $69.9 million at the time of sale and transaction costs of $2.6 million. The Company leased-back the property for an 18-year term. The provision for income tax expense includes around $16.1 million related to this transaction in the three months ended December 31, 2021.
(2)	Expenses incurred for actions designed to implement the Company’s strategy. These actions include, but are not limited to reductions in workforce, streamlining operational processes, rolling out the Amerant brand, implementation of new technology system applications, decommissioning of legacy technologies, enhanced sales tools and training, expanded product offerings and improved customer analytics to identify opportunities.
(3)	In the first quarter of 2022, includes expenses mainly in connection with restructuring of business lines and the outsourcing of certain human resources functions. In the second quarter of 2021, includes expenses in connection with the departure of the Company’s Chief Operating Officer and the elimination of various other support function positions, including the NY LPO. In all of the other periods shown, includes expenses related to the elimination of various support function positions.
(4)	Contract termination and related costs associated with third party vendors resulting from the Company’s engagement of FIS.
(5)	Includes: (i) expenses in connection with the engagement of FIS of $0.8 million, $0.5 million and $0.2 million in the three months ended March 31, 2022, December 31, 2021 and September 30, 2021, respectively; (ii) an aggregate of $0.3 million in connection with information technology projects, and certain search and recruitment expenses in the three months ended March 31, 2022, and (iii) expenses in connection with the Merger and related transactions of $0.6 million and $0.2 million in the three months ended December 31, 2021 and September 30, 2021, respectively.
(6)	Expenses related to the lease termination of a branch in Fort Lauderdale, Florida in 2021 and in Wellington, Florida in 2022.
(7)	Fair value adjustment related to the New York loan portfolio held for sale carried at the lower of cost or fair value.
(8)	In the three months ended March 31, 2022 and 2021, amounts were calculated based upon the effective tax rate for the periods of 21.10% and 20.15%, respectively. For all of the other periods shown, amounts represent the difference between the prior and current period year-to-date tax effect.
(9)	In the three months ended March 31, 2022, December 31, 2021, September 30, 2021 and June 30, 2021, potential dilutive instruments consisted of unvested shares of restricted stock, restricted stock units and performance share units (restricted stock and restricted stock units in the three months ended March 31, 2021). In all the periods presented, potential dilutive instruments were included in the diluted earnings per share computation because, when the unamortized deferred compensation cost related to these shares was divided by the average market price per share in those periods, fewer shares would have been purchased than restricted shares assumed issued. Therefore, in those periods, such awards resulted in higher diluted weighted average shares outstanding than basic weighted average shares outstanding, and had a dilutive effect in per share earnings.
(10)	Other intangible assets consist of, among other things, mortgage servicing rights (“MSRs”) of $0.9 million, $0.6 million, $0.6 million and $0.5 million at March 31, 2022, December 31, 2021, September 30, 2021 and June 30 2021, respectively, and are included in other assets in the Company’s consolidated balance sheets. We had no MSRs at March 31, 2021.

Exhibit 3 – Average Balance Sheet, Interest and Yield/Rate Analysis

The following tables present average balance sheet information, interest income, interest expense and the corresponding average yields earned and rates paid for the periods presented. The average balances for loans include both performing and nonperforming balances. Interest income on loans includes the effects of discount accretion and the amortization of non-refundable loan origination fees, net of direct loan origination costs, accounted for as yield adjustments. Average balances represent the daily average balances for the periods presented.

	Three Months Ended
	March 31, 2022							December 31, 2021							March 31, 2021
(in thousands, except percentages)	Average Balances		Income/ Expense			Yield/ Rates		Average Balances		Income/ Expense			Yield/ Rates		Average Balances		Income/ Expense		Yield/ Rates
Interest-earning assets:
Loan portfolio, net (1)(2)	$	5,492,547		$	56,338	4.16	%	$	5,475,207		$	56,521	4.10	%	$	5,678,547	$	52,771	3.77	%
Debt securities available for sale (3)		1,170,491			7,378	2.56	%		1,171,691			7,010	2.37	%		1,207,764		6,495	2.18	%
Debt securities held to maturity (4)		114,655			703	2.49	%		121,842			745	2.43	%		67,729		302	1.81	%
Debt securities held for trading		35			1	11.59	%		143			1	2.77	%		104		1	3.90	%
Equity securities with readily determinable fair value not held for trading		1,301			—	—	%		17,138			59	1.37	%		24,225		84	1.41	%
Federal Reserve Bank and FHLB stock		51,505			546	4.30	%		49,591			535	4.28	%		63,781		625	3.97	%
Deposits with banks		259,225			132	0.21	%		155,479			58	0.15	%		205,355		51	0.10	%
Total interest-earning assets		7,089,759			65,098	3.72	%		6,991,091			64,929	3.68	%		7,247,505		60,329	3.38	%
Total non-interest-earning assets less allowance for loan losses		616,872							537,549							498,754
Total assets	$	7,706,631						$	7,528,640						$	7,746,259

	Three Months Ended
	March 31, 2022							December 31, 2021							March 31, 2021
(in thousands, except percentages)	Average Balances			Income/ Expense		Yield/ Rates		Average Balances			Income/ Expense		Yield/ Rates		Average Balances			Income/ Expense		Yield/ Rates
Interest-bearing liabilities:
Checking and saving accounts –
Interest bearing DDA	$	1,556,480		$	290	0.08	%	$	1,342,416		$	208	0.06	%	$	1,258,301		$	113	0.04	%
Money market		1,253,293			734	0.24	%		1,337,529			788	0.23	%		1,236,026			966	0.32	%
Savings		325,121			11	0.01	%		327,090			11	0.01	%		318,800			14	0.02	%
Total checking and saving accounts		3,134,894			1,035	0.13	%		3,007,035			1,007	0.13	%		2,813,127			1,093	0.16	%
Time deposits		1,295,278			4,281	1.34	%		1,380,337			4,777	1.37	%		1,956,559			7,360	1.53	%
Total deposits		4,430,172			5,316	0.49	%		4,387,372			5,784	0.52	%		4,769,686			8,453	0.72	%
Securities sold under agreements to repurchase		—			—	—	%		55			—	—	%		—			—	—	%
Advances from the FHLB and other borrowings (5)		917,039			2,481	1.10	%		863,137			1,805	0.83	%		1,050,000			2,758	1.07	%
Senior notes		58,934			942	6.48	%		58,855			942	6.35	%		58,618			942	6.52	%
Subordinated notes		7,451			88	4.79	%		—			—	—	%		—			—	—	%
Junior subordinated debentures		64,178			626	3.96	%		64,178			618	3.82	%		64,178			607	3.84	%
Total interest-bearing liabilities		5,477,774			9,453	0.70	%		5,373,597			9,149	0.68	%		5,942,482			12,760	0.87	%
Non-interest-bearing liabilities:
Non-interest bearing demand deposits		1,199,264							1,210,365							925,266
Accounts payable, accrued liabilities and other liabilities		231,088							133,927							93,450
Total non-interest-bearing liabilities		1,430,352							1,344,292							1,018,716
Total liabilities		6,908,126							6,717,889							6,961,198
Stockholders’ equity		798,505							810,751							785,061
Total liabilities and stockholders’ equity	$	7,706,631						$	7,528,640						$	7,746,259
Excess of average interest-earning assets over average interest-bearing liabilities	$	1,611,985						$	1,617,494						$	1,305,023
Net interest income				$	55,645						$	55,780						$	47,569
Net interest rate spread						3.02	%						3.00	%						2.51	%
Net interest margin (6)						3.18	%						3.17	%						2.66	%
Cost of total deposits (7)						0.38	%						0.41	%						0.60	%
Ratio of average interest-earning assets to average interest-bearing liabilities		129.43	%						130.10	%						121.96	%
Average non-performing loans/ Average total loans		0.71	%						1.13	%						1.54	%

___________
(1)	Includes loans held for investment net of the allowance for loan losses and loans held for sale. The average balance of the allowance for loan losses was $67.5 million, $82.1 million, and $111.1 million in the three months ended March 31, 2022, December 31, 2021 and March 31, 2021, respectively.The average balance of total loans held for sale was $137.7 million, $206.8 million, and $128 thousand in the three months ended March 31, 2022, December 31, 2021 and March 31, 2021, respectively.
(2)	Includes average non-performing loans of $39.2 million, $63.0 million and $89.2 million for the three months ended March 31, 2022, December 31, 2021 and March 31, 2021, respectively.
(3)	Includes nontaxable securities with average balances of $16.2 million, $17.7 million and $54.7 million for the three months ended March 31, 2022, December 31, 2021 and March 31, 2021, respectively. The tax equivalent yield for these nontaxable securities was 2.81%, 1.79% and 3.80% for the three months ended March 31, 2022, December 31, 2021 and March 31, 2021, respectively. In 2022 and 2021, the tax equivalent yields were calculated by assuming a 21% tax rate and dividing the actual yield by 0.79.
(4)	Includes nontaxable securities with average balances of $37.8 million, $44.3 million and $56.6 million for the three months ended March 31, 2022, December 31, 2021 and March 31, 2021, respectively. The tax equivalent yield for these nontaxable securities was 3.67%, 3.06% and 2.40% for the three months ended March 31, 2022, December 31, 2021 and March 31, 2021. In 2022 and 2021, the tax equivalent yields were calculated assuming a 21% tax rate and dividing the actual yield by 0.79.
(5)	The terms of the FHLB advance agreements require the Bank to maintain certain investment securities or loans as collateral for these advances.
(6)	NIM is defined as net interest income divided by average interest-earning assets, which are loans, securities, deposits with banks and other financial assets which yield interest or similar income.
(7)	Calculated based upon the average balance of total noninterest bearing and interest bearing deposits.

Exhibit 4 – Noninterest Income

This table shows the amounts of each of the categories of noninterest income for the periods presented.

	Three Months Ended
	March 31, 2022					December 31, 2021					March 31, 2021
(in thousands, except percentages)	Amount			%		Amount			%		Amount		%

Deposits and service fees	$	4,620		32.9	%	$	4,521		5.9	%	$	4,106	29.0	%
Brokerage, advisory and fiduciary activities		4,596		32.8	%		4,987		6.5	%		4,603	32.5	%
Change in cash surrender value of bank owned life insurance (“BOLI”)⁽¹⁾		1,342		9.6	%		1,366		1.8	%		1,356	9.6	%
Cards and trade finance servicing fees		590		4.2	%		503		0.7	%		339	2.4	%
Loss on early extinguishment of FHLB advances, net		(714	)	(5.1)%			—		—	%		—	—	%
Gain on sale of Headquarters Building ⁽²⁾		—		—	%		62,387		80.7	%		—	—	%
Securities gains (losses), net ⁽³⁾		769		5.5	%		(117	)	(0.2)%			2,582	18.2	%
Derivative losses, net ⁽⁴⁾		(1,345	)	(9.6)%			—		—	%		—	—	%
Loan-level derivative income ⁽⁵⁾		3,152		22.5	%		1,973		2.6	%		232	1.6	%
Other noninterest income ⁽⁶⁾⁽⁷⁾		1,015		7.2	%		1,670		2.0	%		945	6.7	%
Total noninterest income	$	14,025		100.0	%	$	77,290		100.0	%	$	14,163	100.0	%

__________________
(1)	Changes in cash surrender value of BOLI are not taxable.
(2)	The Company sold its Coral Gables headquarters for $135 million, with an approximate carrying value of $69.9 million at the time of sale and transaction costs of $2.6 million. The Company leased-back the property for an 18-year term.
(3)	Includes: (i) net gain on sale of debt securities of $49 thousand, $37 thousand and $2.9 million in the three months ended March 31, 2022, December 31, 2021 and March 31, 2021, respectively, and (iii) unrealized gains of $0.7 million in the three months ended March 31, 2022 and unrealized losses of $0.1 million and $0.4 million in the three months ended December 31, 2021 and March 31, 2021, respectively, related to the change in fair value of marketable equity securities. In addition, the three months ended December 31, 2021 includes a realized loss of $42 thousand on the sale of a mutual fund with a fair value of $23.4 million at the time of the sale.
(4)	Unrealized losses related to uncovered interest rate swaps with clients.
(5)	Income from interest rate swaps and other derivative transactions with customers. In three months ended March 31, 2022 and December 31, 2021, the Company incurred in expenses related to derivative transactions with customers of $1.0 million and $0.7 million, respectively, which are included as part of noninterest expenses under professional and other services fees. We had no expenses associated with derivative transactions with customers in the three months ended March 31, 2021.
(6)	Includes mortgage banking revenue related to Amerant Mortgage of $0.8 million and $0.9 million in the three months ended March 31, 2022 and December 31 2021, respectively. Other sources of income in the periods shown include from foreign currency exchange transactions with customers and valuation income on the investment balances held in the non-qualified deferred compensation plan.
(7)	In the three months ended March 31, 2022, rental income associated with the subleasing of portions of the Company’s headquarters building is presented as a reduction to rent expense under lease agreements under occupancy and equipment cost. In all of the other periods shown rental income in connection with the previously-owned headquarters building is shown as part of other income.

Exhibit 5 – Noninterest Expense

This table shows the amounts of each of the categories of noninterest expense for the periods presented.

	Three Months Ended
	March 31, 2022				December 31, 2021				March 31, 2021
(in thousands, except percentages)	Amount		%		Amount		%		Amount		%

Salaries and employee benefits ⁽¹⁾	$	30,403	50.0	%	$	31,309	56.8	%	$	26,427	60.6	%
Occupancy and equipment ^{(2) (3)}		6,725	11.1	%		5,765	10.5	%		4,488	10.3	%
Professional and other services fees ^{(4) (5)}		7,182	11.8	%		7,250	13.2	%		3,784	8.7	%
Telecommunications and data processing		4,038	6.6	%		3,897	7.1	%		3,727	8.5	%
Depreciation and amortization ⁽⁶⁾		1,152	1.9	%		1,520	2.8	%		1,786	4.1	%
FDIC assessments and insurance		1,396	2.3	%		1,340	2.4	%		1,755	4.0	%
Loans held for sale valuation expense ⁽⁷⁾		459	0.8	%		—	—	%		—	—	%
Advertising expenses		2,972	4.9	%		1,463	2.7	%		316	0.7	%
Contract termination costs ⁽⁸⁾		4,012	6.6	%		—	—	%		—	—	%
Other operating expenses ⁽⁹⁾		2,479	4.0	%		2,544	4.5	%		1,342	3.1	%
Total noninterest expense ⁽¹⁰⁾	$	60,818	100.0	%	$	55,088	100.0	%	$	43,625	100.0	%

___________
(1)	Includes severance expense of $0.8 million and $0.3 million in the three months ended March 31, 2022 and December 31, 2021, respectively, mainly in connection with the restructuring of business lines and the elimination of certain support functions in the three months ended March 31, 2022 and with the elimination of various support function positions in the three months ended December 31, 2021. There were no significant severance expenses in the three months ended March 31, 2021.
(2)	In the three months ended March 31, 2022 and December 31, 2021, includes $47 thousand and $0.5 million, respectively, related to the lease termination of a branch in Fort Lauderdale, Florida in 2021.
(3)	In the three months ended March 31, 2022, rent expense under lease agreements is presented net of rental income associated with the subleasing of portions of the Company’s headquarters building. In all of the other periods shown rental income in connection with the previously-owned headquarters building is shown as part of other income.
(4)	In the three months ended March 31, 2022, includes additional expenses of $1.2 million, including (i) $0.8 million related to the engagement of FIS; (ii) $0.2 million in connection with certain search and recruitment expenses, and (iii) $0.1 million of costs associated with the subleasing of the NY office space. In the three months ended December 31, 2021, includes additional expenses of $1.3 million mainly related to: (i) the Merger and related transactions, and (ii) $0.5 million related to the engagement of FIS.
(5)	Other services fees include expenses of $1.0 million and $0.7 million in the three months ended March 31, 2022 and December 31, 2021, respectively, in connection with our loan-level derivative income generation activities. We had no expenses in connection with our loan-level derivative income generation activities in the three months ended March 31, 2021.
(6)	In the three months ended December 31, 2021 and March 31, 2021, includes $0.2 million and $0.5 million, respectively, of depreciation expense associated with the headquarters building. No depreciation expense related to the headquarters building was recorded in the three months ended March 31, 2022 as this property was sold and leased-back in the fourth quarter of 2021.
(7)	Valuation allowance as a result of fair value adjustment related to loans held for sale carried at the lower of fair value or cost.
(8)	Contract termination and related costs associated with third party vendors resulting from the Company’s engagement of FIS.
(9)	In all of the periods shown, includes charitable contributions, community engagement, postage and courier expenses, provisions for possible losses on contingent loans, and debits which mirror the valuation income on the investment balances held in the non-qualified deferred compensation plan in order to adjust the liability to participants of the deferred compensation plan.
(10)	Includes $3.5 million and $3.3 million in the three months ended March 31, 2022 and December 31, 2021, respectively, related to Amerant Mortgage, primarily consisting of salaries and employee benefits, mortgage lending costs and professional and other services fees.

Exhibit 6 – Consolidated Balance Sheets

(in thousands, except share data)	March 31, 2022			December 31, 2021			September 30, 2021			June 30, 2021			March 31, 2021
Assets
Cash and due from banks	$	35,242		$	33,668		$	27,501		$	45,198		$	37,744
Interest earning deposits with banks		234,709			240,540			138,732			126,314			195,755
Restricted cash		6,243			—			—			—			—
Cash and cash equivalents		276,194			274,208			166,233			171,512			233,499
Securities
Debt securities available for sale		1,145,785			1,175,319			1,220,391			1,194,068			1,190,201
Debt securities held to maturity		112,008			118,175			130,543			93,311			104,657
Trading securities		—			—			194			198			—
Equity securities with readily determinable fair value not held for trading		13,370			252			23,870			23,988			23,965
Federal Reserve Bank and Federal Home Loan Bank stock		53,806			47,495			47,740			47,675			56,469
Securities		1,324,969			1,341,241			1,422,738			1,359,240			1,375,292
Loans held for sale, at lower of cost or fair value (1)		68,591			143,195			219,083			—			—
Mortgage loans held for sale, at fair value		17,108			14,905			5,812			1,775			1,044
Loans held for investment, gross		5,635,478			5,409,440			5,254,029			5,606,773			5,753,794
Less: Allowance for loan losses		56,051			69,899			83,442			104,185			110,940
Loans held for investment, net		5,579,427			5,339,541			5,170,587			5,502,588			5,642,854
Bank owned life insurance		224,348			223,006			221,640			220,271			218,903
Premises and equipment, net (2)		37,929			37,860			108,885			108,708			109,071
Deferred tax assets, net		22,119			11,301			9,861			13,516			15,607
Operating lease right-of-use assets (2)		139,477			141,139			51,530			52,519			54,507
Goodwill		19,506			19,506			19,506			19,506			19,506
Accrued interest receivable and other assets		96,168			92,497			93,430			83,209			80,815
Total assets	$	7,805,836		$	7,638,399		$	7,489,305		$	7,532,844		$	7,751,098
Liabilities and Stockholders’ Equity
Deposits
Demand
Noninterest bearing	$	1,318,294		$	1,183,251		$	1,210,154		$	1,065,622		$	977,595
Interest bearing		1,543,708			1,507,441			1,317,938			1,293,626			1,324,127
Savings and money market		1,581,412			1,602,339			1,655,495			1,682,619			1,494,227
Time		1,248,287			1,337,840			1,442,790			1,633,041			1,882,130
Total deposits		5,691,701			5,630,871			5,626,377			5,674,908			5,678,079
Advances from the Federal Home Loan Bank		980,047			809,577			809,095			808,614			1,050,000
Senior notes		58,973			58,894			58,815			58,736			58,656
Subordinated notes		29,156			—			—			—			—
Junior subordinated debentures held by trust subsidiaries		64,178			64,178			64,178			64,178			64,178
Operating lease Liabilities (2)		135,651			136,595			48,709			49,627			50,747
Accounts payable, accrued liabilities and other liabilities		96,734			106,411			69,469			77,713			64,424
Total liabilities		7,056,440			6,806,526			6,676,643			6,733,776			6,966,084

Stockholders’ equity
Class A common stock		3,434			3,589			2,903			2,904			2,904
Class B common stock		—			—			847			853			892
Additional paid in capital		208,109			262,510			299,273			299,547			304,448
Retained earnings		565,963			553,167			489,854			472,823			456,861
Accumulated other comprehensive (loss) income		(24,424	)		15,217			21,236			23,758			19,909
Total stockholders’ equity before noncontrolling interest		753,082			834,483			814,113			799,885			785,014
Noncontrolling interest		(3,686	)		(2,610	)		(1,451	)		(817	)		—
Total stockholders’ equity		749,396			831,873			812,662			799,068			785,014
Total liabilities and stockholders’ equity	$	7,805,836		$	7,638,399		$	7,489,305		$	7,532,844		$	7,751,098

__________
(1)	Includes a $0.5 million valuation allowance as a result of fair value adjustment as of March 31, 2022.
(2)	As of March 31, 2022 and December 31, 2021, includes the effect of the sale and lease back of the Company’s headquarters building in the fourth quarter of 2021.

Exhibit 7 – Loans

Loans by Type – Held For Investment

The loan portfolio held for investment consists of the following loan classes:

(in thousands)	March 31, 2022		December 31, 2021		September 30, 2021		June 30, 2021		March 31, 2021
Real estate loans
Commercial real estate
Non-owner occupied	$	1,570,006	$	1,540,590	$	1,593,664	$	1,699,876	$	1,713,967
Multi-family residential		540,726		514,679		504,337		658,022		722,783
Land development and construction loans		296,609		327,246		318,449		361,077		351,502
		2,407,341		2,382,515		2,416,450		2,718,975		2,788,252
Single-family residential		707,594		661,339		618,139		616,545		625,298
Owner occupied		927,921		962,538		936,590		943,342		940,126
		4,042,856		4,006,392		3,971,179		4,278,862		4,353,676
Commercial loans		1,093,205		965,673		910,696		1,003,411		1,104,594
Loans to financial institutions and acceptances		13,730		13,710		13,690		13,672		16,658
Consumer loans and overdrafts		485,687		423,665		358,464		310,828		278,866
Total loans	$	5,635,478	$	5,409,440	$	5,254,029	$	5,606,773	$	5,753,794

Loans by Type – Held For Sale

The loan portfolio held for sale consists of the following loan classes:

(in thousands)	March 31, 2022		December 31, 2021		September 30, 2021		June 30, 2021		March 31, 2021
Loans held for sale at the lower of cost or fair value
Real estate loans
Commercial real estate
Non-owner occupied	$	46,947	$	110,271	$	160,034	$	—	$	—
Multi-family residential		20,796		31,606		57,725		—		—
		67,743		141,877		217,759		—		—
Single-family residential		—		—		—		—		1,044
Owner occupied		1,306		1,318		1,324		—		—
Total real estate loans		69,049		143,195		219,083		—		1,044
Less: valuation allowance		458		—		—		—		—
Total loans held for sale at the lower of cost or fair value (1)		68,591		143,195		219,083		—		1,044

Loans held for sale at fair value
Land development and construction loans		836		—		—		—		—
Single-family residential		16,272		14,905		5,812		1,775
Total loans held for sale at fair value (2)		17,108		14,905		5,812		1,775		—
Total loans held for sale (3)	$	85,699	$	158,100	$	224,895	$	1,775	$	1,044

__________________
(1)	During the three months ended March 31, 2022 and December 31, 2021, the Company sold $57.3 million and $49.4 million in loans held for sale carried at the lower of cost or estimated fair value related to the NY portfolio.
(2)	Loans held for sale in connection with Amerant Mortgage ongoing business.
(3)	Remained current and in accrual status at each of the periods shown.

Non-Performing Assets

This table shows a summary of our non-performing assets by loan class, which includes non-performing loans and other real estate owned, or OREO, at the dates presented. Non-performing loans consist of (i) nonaccrual loans; (ii) accruing loans 90 days or more contractually past due as to interest or principal; and (iii) restructured loans that are considered TDRs.

(in thousands)	March 31, 2022		December 31, 2021		September 30, 2021		June 30, 2021		March 31, 2021
Non-Accrual Loans ⁽¹⁾
Real Estate Loans
Commercial real estate (CRE)
Non-owner occupied	$	12,825	$	7,285	$	28,507	$	48,347	$	8,515
Multi-family residential		—		—		—		9,928		11,369
		12,825		7,285		28,507		58,275		19,884
Single-family residential		3,717		5,126		6,344		7,174		10,814
Owner occupied		10,770		8,665		11,040		11,277		12,527
		27,312		21,076		45,891		76,726		43,225
Commercial loans ^{(2) (3)}		19,178		28,440		36,500		43,876		45,282
Consumer loans and overdrafts		468		257		353		198		270
Total Non-Accrual Loans	$	46,958	$	49,773	$	82,744	$	120,800	$	88,777

Past Due Accruing Loans ⁽⁴⁾
Real Estate Loans
Commercial real estate (CRE)
Non-owner occupied	$	—	$	—	$	—	$	—	$	743
Single-family residential		—		—		4		20		—
Owner occupied		—		—		—		—		—
Commercial		—		—		—		295		—
Consumer loans and overdrafts		10		8		1		4		3
Total Past Due Accruing Loans		10		8		5		319		746
Total Non-Performing Loans		46,968		49,781		82,749		121,119		89,523
Other Real Estate Owned		9,720		9,720		9,800		400		400
Total Non-Performing Assets	$	56,688	$	59,501	$	92,549	$	121,519	$	89,923

__________________
(1)	Includes loan modifications that met the definition of TDRs which may be performing in accordance with their modified loan terms. As of March 31, 2022, December 31, 2021, September 30, 2021, June 30, 2021 and March 31, 2021, non-performing TDRs include $8.6 million, $9.1 million, $9.3 million, $9.6 million and $9.8 million, respectively, in a multiple loan relationship to a South Florida borrower.
(2)	As of March 31, 2022, December 31, 2021, September 30, 2021, June 30, 2021 and March 31, 2021, includes $9.1 million, $9.1 million, $13.9 million, $19.6 and $19.6 million, respectively, in a commercial relationship placed in nonaccrual status during the second quarter of 2020. During the third quarters of 2021 and 2020, the Company charged off $5.7 million and $19.3 million, respectively, against the allowance for loan losses as result of the deterioration of this commercial relationship. In addition, in connection with this loan relationship, the Company collected a partial principal payment of $4.8 million in the fourth quarter of 2021.
(3)	In the first quarter of 2022, the Company collected a partial payment of around $9.8 million on one commercial nonaccrual loan of $12.4 million. Also, in the first quarter of 2022, the Company charged-off the remaining balance of this loan of $2.5 million against its specific reserve at December 31, 2021.
(4)	Loans past due 90 days or more but still accruing.

Loans by Credit Quality Indicators

This table shows the Company’s loans by credit quality indicators. We have no purchased credit-impaired loans.

	March 31, 2022								December 31, 2021								March 31, 2021
(in thousands)	Special Mention		Substandard		Doubtful		Total (1)		Special Mention		Substandard		Doubtful		Total (1)		Special Mention		Substandard		Doubtful		Total (1)
Real Estate Loans
Commercial Real Estate (CRE)
Non-owner occupied	$	3,221	$	11,522	$	1,303	$	16,046	$	34,205	$	5,890	$	1,395	$	41,490	$	45,206	$	5,684	$	3,576	$	54,466
Multi-family residential		—		—		—		—		—		—		—		—		—		11,369		—		11,369
Land development and construction loans		—		—		—		—		—		—		—		—		—		—		—		—
		3,221		11,522		1,303		16,046		34,205		5,890		1,395		41,490		45,206		17,053		3,576		65,835
Single-family residential		—		3,812		—		3,812		—		5,221		—		5,221		—		10,814		—		10,814
Owner occupied		7,383		10,862		—		18,245		7,429		8,759		—		16,188		21,045		12,627		—		33,672
		10,604		26,196		1,303		38,103		41,634		19,870		1,395		62,899		66,251		40,494		3,576		110,321
Commercial loans (2)		25,545		18,519		1,989		46,053		32,452		20,324		9,497		62,273		43,313		21,045		25,917		90,275
Consumer loans and overdrafts		—		468		—		468		—		270		—		270		—		298		—		298
	$	36,149	$	45,183	$	3,292	$	84,624	$	74,086	$	40,464	$	10,892	$	125,442	$	109,564	$	61,837	$	29,493	$	200,894

__________
(1)	There were no loans categorized as “Loss” as of the dates presented.
(2)	Loan balances as of March 31, 2022 and December 31, 2021 include $9.1 million in a commercial relationship placed in nonaccrual status and downgraded during the second quarter of 2020 ($19.6 million at March 31, 2021). As of March 31, 2022 and December 31, 2021, Substandard loans include $7.9 million and $4.9 million, respectively and doubtful loans include $1.2 million and $4.2 million, respectively, related to this commercial relationship (Substandard loans include $7.3 million and doubtful loans include $12.3 million at March 31, 2021). During the third quarters of 2021 and 2020, the Company charged off $5.7 million and $19.3 million, respectively, against the allowance for loan losses as result of the deterioration of this commercial relationship. In addition, in connection with this loan relationship, the Company collected a partial principal payment of $4.8 million in the fourth quarter of 2021.

Exhibit 8 – Deposits by Country of Domicile

This table shows the Company’s deposits by country of domicile of the depositor as of the dates presented.

(in thousands)	March 31, 2022		December 31, 2021		September 30, 2021		June 30, 2021		March 31, 2021

Domestic	$	3,180,112	$	3,137,258	$	3,090,563	$	3,140,541	$	3,175,522
Foreign:
Venezuela		2,004,305		2,019,480		2,054,149		2,075,658		2,088,519
Others		507,284		474,133		481,665		458,709		414,038
Total foreign		2,511,589		2,493,613		2,535,814		2,534,367		2,502,557
Total deposits	$	5,691,701	$	5,630,871	$	5,626,377	$	5,674,908	$	5,678,079

CONTACTS:

Investors

Laura Rossi

[email protected]

(305) 460-8728

Media

Silvia M. Larrieu

[email protected]

(305) 441-8414

April 20, 2022 4:48 pm

CBNK Quarterly Earnings Grow 13.7 Percent Year Over Year

Diluted EPS of $0.71, ROAA of 2.01%, and ROAE of 20.30% for 1Q 2022

ROCKVILLE, Md., April 20, 2022 (GLOBE NEWSWIRE) — Capital Bancorp, Inc. (the “Company”) (NASDAQ: CBNK), the holding company for Capital Bank, N.A. (the “Bank”), today reported net income of $10.2 million, or $0.71 per diluted share, for the first quarter of 2022. By comparison, net income was $9.0 million, or $0.65 per diluted share, for the first quarter of 2021. Portfolio loans, net, increased $213.9 million when compared to the period ended March 31, 2021.

“We started the year with another quarter of outstanding profitability at both the Commercial Bank and OpenSky^®,” said Ed Barry, CEO of the Company and the Bank. “Loan production at the Commercial Bank was strong as new hires and strategic initiatives continue to gain momentum, but growth was negatively impacted by payoffs and selective offboarding of certain lower-quality credit relationships. OpenSky^® profitability was stable as updated agreements with service providers delivered savings on data processing costs offsetting anticipated card holder attrition which resulted in a decline in open accounts for the quarter. We are optimistic that our business-wide strategic investments will begin to deliver both increased revenues and lower costs in the coming quarters.”

Steven Schwartz, Chairman of the Board of the Company, said, “Despite the detrimental impact of rising interest rates on our mortgage refinance origination volume, we are pleased with the earnings for the quarter. I believe our commercial loan portfolio is well positioned to benefit from the anticipated interest rate increases and our continued focus on a diversified revenue model should maintain our superior results.”

First Quarter 2022 Highlights

Capital Bancorp, Inc.

Strong Earnings – Continued strong performance by the Commercial Bank and OpenSky^® contributed to the first quarter’s results. Quarterly net income increased to $10.2 million from $9.0 million in the first quarter of 2021. Earnings were $0.71 per diluted share for the three months ended March 31, 2022 and $0.65 for the three months ended March 31, 2021.
Outstanding Performance Ratios – Return on average assets (“ROAA”) and return on average equity (“ROAE”) were 2.01% and 20.30%, respectively, for the three months ended March 31, 2022 compared to 1.87% and 22.30%, respectively, for the three months ended March 31, 2021.
Expanded Net Interest Margin – Net interest margin was 6.79% for the three months ended March 31, 2022, compared to 5.15% for the same three month period last year. The margin expansion was primarily driven by increases in the yield on portfolio loans due to the recognition of deferred fees associated with the credit card portfolio, as well as an acceleration in the deferred fees related to forgiven loans in the Small Business Administration Payroll Protection Program (“SBA-PPP”).
Robust Capital Positions – As of March 31, 2022, the Company reported a common equity tier 1 capital ratio of 15.04% and an allowance for loan losses to total loans ratio of 1.60%, or 1.65% excluding SBA-PPP loans. Quarter over quarter, tangible book value per common share grew 18.5 percent to $14.39 at March 31, 2022.

Commercial Bank

Strong Portfolio Loan Growth – Portfolio loans, excluding credit cards, increased by $179.6 million, or 14.6 percent, to $1.4 billion at March 31, 2022 compared to March 31, 2021. The quarter over quarter growth was mainly due to a 30.3 percent increase in commercial real estate loans of $131.4 million, of which $72.8 million was owner occupied. Also contributing to the quarter over quarter growth was a 17.2 percent increase in commercial and industrial loans of $26.1 million and an 11.0 percent increase in construction real estate loans of $24.4 million.
Growth in Core Deposits and Reduced Cost of Funds – Noninterest bearing deposits increased 6.9 percent compared to March 31, 2021. The $53.3 million year over year increase was primarily due to an increase in commercial demand deposits reflecting management’s ongoing strategic initiative to improve the deposit franchise. At March 31, 2022, noninterest bearing deposits represented 44.3% of total deposits compared to 41.4% at March 31, 2021. Overall, the cost of interest bearing liabilities was reduced 39 basis points, from 0.81% for the quarter ended March 31, 2021 to 0.42% for the quarter ended March 31, 2022.
Improving Credit Metrics – Non-performing assets (“NPAs”) decreased to 0.28% of total assets at March 31, 2022 compared to 0.58% at March 31, 2021 with the disposition of $3.3 million in other real estate owned and a reduction in nonaccrual loans of $2.8 million as management continues to focus on reducing non-performing assets. The provision for loan losses increased $449 thousand compared to the first quarter of 2021. The current provision for the three months ended March 31, 2022 was $952 thousand and was primarily related to the credit card portfolio and the cycling of accounts, not a deterioration in overall credit quality.
SBA-PPP Loans
– SBA-PPP loans, net of $1.3 million in unearned fees, totaled $51.1 million at March 31, 2022 which was comprised of $1.7 million in 2020 originations and $49.4 million of 2021 originations. As of March 31, 2022, the Company has obtained forgiveness for $323.3 million of SBA-PPP loans.

Capital Bank Home Loans

Slowing Mortgage Originations – Origination volumes declined 68.8 percent, to $110.4 million, in the first quarter of 2022, when compared to $353.8 million in the first quarter of 2021. The continued steepening of the yield curve in the first quarter of 2022 slowed originations from the year earlier when low interest rates fueled refinance volumes.
Purchase Volume – While purchase volumes increased to 73.2 percent of total originations for the first quarter of 2022, up from 24.6 percent during the first quarter of 2021, total purchase originations declined by 8.3% during the same period.

OpenSky

^®

Strong Revenue Growth – OpenSky^® revenue grew by 47.6 percent to $20.9 million for the quarter ended March 31, 2022 from the same period in 2021 due to an increase in average credit card loan balances as well as an increase in the yield on those credit card loans. The surge in new account originations over the past two years has slowed as government stimulus ended and competition increased. New account originations have reverted to a pace reminiscent of 2019, and is not enough to offset the normal customer lifecycle of the 2020 and 2021 vintages.
Continued Growth in OpenSky
^®
Loans and Deposits – OpenSky^®loan balances, net of reserves, increased by $40.0 million to $123.7 million compared to $83.7 million in the first quarter of 2021. Corresponding deposit balances increased 2.1 percent or $4.5 million from $215.9 million at March 31, 2021 to $220.4 million at March 31, 2022.
Expense Management Efforts Demonstrate Scale – Key contracts renegotiated during the first quarter of 2022 will engender cost saves and scale benefits throughout the remainder of the year and into the future.

COMPARATIVE FINANCIAL HIGHLIGHTS – Unaudited

	Quarter Ended
	March 31,
(dollars in thousands except per share data)		2022			2021		% Change
Earnings Summary
Interest income	$	34,402		$	26,638		29.1	%
Interest expense		1,071			2,194		(51.2	)%
Net interest income		33,331			24,444		36.4	%
Provision for loan losses		952			503		89.3	%
Noninterest income		8,288			13,951		(40.6	)%
Noninterest expense		27,102			25,767		5.2	%
Income before income taxes		13,565			12,125		11.9	%
Income tax expense		3,354			3,143		6.7	%
Net income	$	10,211		$	8,982		13.7	%

Pre-tax pre-provision net revenue (“PPNR”) ⁽²⁾	$	14,517		$	12,628		15.0	%
Weighted average common shares – Basic		13,989			13,757		1.7	%
Weighted average common shares – Diluted		14,339			13,899		3.2	%
Earnings per share – Basic	$	0.73		$	0.65		12.3	%
Earnings per share – Diluted	$	0.71		$	0.65		9.2	%
Return on average assets ⁽¹⁾		2.01	%		1.87	%	7.5	%
Return on average assets, excluding impact of SBA-PPP loans^{(1) (2)}		1.67	%		1.54	%	8.4	%
Return on average equity		20.30	%		22.30	%	(9.0	)%

	Quarter Ended				1Q22 vs. 1Q21		Quarter Ended
	March 31,				1Q22 vs. 1Q21		December 31,		September 30,		June 30,
(in thousands except per share data)	2022		2021		% Change		2021		2021		2021
Balance Sheet Highlights
Assets	$	2,122,453	$	2,091,851	1.5	%	$	2,055,300	$	2,169,556	$	2,151,850
Investment securities available for sale		172,712		128,023	34.9	%		184,455		189,165		160,515
Mortgage loans held for sale		17,036		60,816	(72.0	)%		15,989		36,005		47,935
SBA-PPP loans, net of fees		51,085		267,871	(80.9	)%		108,285		137,178		202,763
Portfolio loans receivable ⁽³⁾		1,526,256		1,312,375	16.3	%		1,523,982		1,445,126		1,392,471
Allowance for loan losses		25,252		23,550	7.2	%		25,181		24,753		24,079
Deposits		1,862,722		1,863,069	—	%		1,797,137		1,921,238		1,917,419
FHLB borrowings		22,000		22,000	—	%		22,000		22,000		22,000
Other borrowed funds		12,062		12,062	—	%		12,062		12,062		12,062
Total stockholders’ equity		201,492		167,003	20.7	%		197,903		189,080		177,204
Tangible common equity⁽²⁾		201,492		167,003	20.7	%		197,903		189,080		177,204

Common shares outstanding		14,001		13,759	1.8	%		13,962		13,802		13,772
Tangible book value per share⁽²⁾	$	14.39	$	12.14	18.5	%	$	14.17	$	13.70	$	12.87

______________
⁽¹⁾Annualized for the quarterly periods
⁽²⁾Refer to Appendix for reconciliation of non-GAAP measures.
⁽³⁾Loans are reflected net of deferred fees and costs.

Operating Results – Comparison of Three Months Ended March 31, 2022 and 2021

For the three months ended March 31, 2022, net interest income increased $8.9 million, or 36.4 percent, to $33.3 million from the same period in 2021, primarily due to an increase in interest earned on the credit card loan portfolio. The net interest margin increased 164 basis points to 6.79% for the three months ended March 31, 2022 from the same period in 2021 due in large part to the acceleration of the deferred fees associated with the SBA-PPP loan forgiveness as well as the recognition of deferred fees on the credit card loans. Net interest margin, excluding credit card and SBA-PPP loans, was 3.82% for the first quarter of 2022 compared to 3.63% for the same period in 2021. For the three months ended March 31, 2022, average interest earning assets increased $66.9 million, or 3.5 percent, to $2.0 billion as compared to the same period in 2021, and the average yield on interest earning assets increased 139 basis points. Compared to the same period in the prior year, average interest-bearing liabilities decreased $55.4 million, or 5.0 percent, while the average cost of interest-bearing liabilities decreased 39 basis points to 0.42% from 0.81%.

The provision for loan losses of $952 thousand for the three months ended March 31, 2022 was primarily related to growth in the credit card portfolio and the cycling of credit card accounts. Net charge-offs for the first quarter of 2022 were $881 thousand, or 0.24% on an annualized basis of average portfolio loans, compared to $388 thousand, or 0.12% on an annualized basis of average loans for the first quarter of 2021. All of the $881 thousand in net charge-offs during the quarter were related to the credit card portfolio.

For the quarter ended March 31, 2022, noninterest income was $8.3 million, a decrease of $5.7 million, or 40.6 percent, from $14.0 million in the prior year quarter. The decrease was primarily the result of reduced mortgage banking revenue.

Net credit card loan balances increased by $40.0 million to $123.7 million as of March 31, 2022 from $83.7 million at March 31, 2021. The related deposit account balances increased 2.1 percent to $220.4 million at March 31, 2022 when compared to $215.9 million at March 31, 2021. For the three months ended March 31, 2022, OpenSky’s^®secured credit card accounts decreased by 30 thousand net compared to 74 thousand net new accounts for the same period in 2021 suggesting consumer behaviors may be returning to historical trends after being elevated in response to COVID-19 throughout 2020 and the first half of 2021.

The efficiency ratio for the three months ended March 31, 2022 decreased to 65.12% compared to 67.11% for the three months ended March 31, 2021.

Noninterest expense was $27.1 million for the three months ended March 31, 2022, as compared to $25.8 million for the three months ended March 31, 2021, an increase of $1.3 million, or 5.2 percent. The increase was primarily driven by increases in salaries and employee benefits of $1.7 million, advertising expenses of $806 thousand, and professional fees of $697 thousand and were offset by decreases in data processing expenses of $1.0 million, loan processing expenses of $660 thousand, and occupancy and equipment expense of $103 thousand.

Financial Condition

Total assets at March 31, 2022 were $2.1 billion, an increase of 1.5% from March 31, 2021. Net portfolio loans, which exclude mortgage loans held for sale and SBA-PPP loans, totaled $1.5 billion as of March 31, 2022, an increase of 16.3 percent as compared to $1.3 billion at March 31, 2021.

While total deposits remained steady at $1.9 billion for the periods ended March 31, 2022 and March 31, 2021, the composition of the deposit portfolio shifted, with an increase in noninterest bearing deposits of $53.3 million, or 6.9%, when comparing March 31, 2022 to March 31, 2021. At March 31, 2022, there were no listing service or brokered deposits compared to $86.0 million at March 31, 2021.

The Company recorded a provision for loan losses of $952 thousand during the three months ended March 31, 2022, which increased the allowance for loan losses to $25.3 million, or 1.60% of total loans (1.65%, excluding SBA-PPP loans, on a non-GAAP basis) at March 31, 2022. Nonperforming assets were $6.0 million, or 0.28% of total assets, as of March 31, 2022, down from $12.1 million, or 0.58% of total assets, at March 31, 2021, and was comprised solely of nonperforming loans. Included in nonperforming loans at March 31, 2022 were troubled debt restructurings of $525 thousand.

Stockholders’ equity increased to $201.5 million as of March 31, 2022, compared to $167.0 million at March 31, 2021. This increase was primarily attributable to earnings during the period of $41.2 million which were offset by unrealized losses recorded net of tax on the available for sale securities in the rising interest rate environment creating a $7.8 million reduction in accumulated other comprehensive income during the period. As of March 31, 2022, the Bank’s capital ratios continued to exceed the regulatory requirements for a “well-capitalized” institution.

Consolidated Statements of Income (Unaudited)
	Three Months Ended March 31,
(in thousands)	2022		2021
Interest income
Loans, including fees	$	33,889	$	26,068
Investment securities available for sale		370		478
Federal funds sold and other		143		92
Total interest income		34,402		26,638

Interest expense
Deposits		884		2,006
Borrowed funds		187		188
Total interest expense		1,071		2,194

Net interest income		33,331		24,444
Provision for loan losses		952		503
Net interest income after provision for loan losses		32,379		23,941

Noninterest income
Service charges on deposits		163		148
Credit card fees		5,924		5,940
Mortgage banking revenue		1,790		7,743
Other fees and charges		411		120
Total noninterest income		8,288		13,951

Noninterest expenses
Salaries and employee benefits		10,310		8,568
Occupancy and equipment		1,026		1,129
Professional fees		2,321		1,624
Data processing		8,276		9,311
Advertising		1,639		833
Loan processing		392		1,052
Other operating		3,138		3,250
Total noninterest expenses		27,102		25,767
Income before income taxes		13,565		12,125
Income tax expense		3,354		3,143
Net income	$	10,211	$	8,982

Consolidated Balance Sheets
(in thousands except share data)	(unaudited) March 31, 2022			December 31, 2021
Assets
Cash and due from banks	$	14,955		$	42,914
Interest bearing deposits at other financial institutions		298,501			136,824
Federal funds sold		330			3,657
Total cash and cash equivalents		313,786			183,395
Investment securities available for sale		172,712			184,455
Marketable equity securities		245			245
Restricted investments		3,602			3,498
Loans held for sale		17,036			15,989
SBA-PPP loans receivable, net of fees		51,085			108,285
Portfolio loans receivable, net of deferred fees and costs		1,526,256			1,523,982
Less allowance for loan losses		(25,252	)		(25,181	)
Total portfolio loans held for investment, net		1,501,004			1,498,801
Premises and equipment, net		2,977			3,282
Accrued interest receivable		7,512			7,901
Deferred income taxes, net		12,366			9,793
Other real estate owned		—			86
Bank owned life insurance		35,758			35,506
Other assets		4,370			4,064
Total assets	$	2,122,453		$	2,055,300

Liabilities
Deposits
Noninterest bearing	$	825,174		$	787,650
Interest bearing		1,037,548			1,009,487
Total deposits		1,862,722			1,797,137
Federal Home Loan Bank advances		22,000			22,000
Other borrowed funds		12,062			12,062
Accrued interest payable		480			473
Other liabilities		23,697			25,725
Total liabilities		1,920,961			1,857,397

Stockholders’ equity
Common stock, $.01 par value; 49,000,000 shares authorized; 14,000,520 and 13,962,334 issued and outstanding		140			140
Additional paid-in capital		55,226			54,306
Retained earnings		153,949			144,533
Accumulated other comprehensive loss		(7,823	)		(1,076	)
Total stockholders’ equity		201,492			197,903
Total liabilities and stockholders’ equity	$	2,122,453		$	2,055,300

The following table shows the average outstanding balance of each principal category of our assets, liabilities and stockholders’ equity, together with the average yields on our assets and the average costs of our liabilities for the periods indicated. Such yields and costs are calculated by dividing the annualized income or expense by the average daily balances of the corresponding assets or liabilities for the same period.

	Three Months Ended March 31,
		2022						2021
	Average Outstanding Balance		Interest Income/ Expense		Average Yield/ Rate ⁽¹⁾		Average Outstanding Balance		Interest Income/ Expense		Average Yield/ Rate ⁽¹⁾
	(Dollars in thousands)
Assets
Interest earning assets:
Interest bearing deposits	$	197,720	$	101	0.21	%	$	205,799	$	49	0.10	%
Federal funds sold		4,658		1	0.09			3,871		—	—
Investment securities available for sale		180,567		370	0.83			106,704		478	1.82
Restricted stock and equity securities		3,766		41	4.42			3,906		43	4.43
Loans held for sale		13,500		111	3.33			72,460		481	2.69
SBA-PPP loans receivable		83,264		2,066	10.06			232,371		2,469	4.31
Portfolio loans receivable⁽²⁾		1,506,902		31,712	8.53			1,298,352		23,118	7.22
Total interest earning assets		1,990,377		34,402	7.01			1,923,463		26,638	5.62
Noninterest earning assets		66,824						25,803
Total assets	$	2,057,201					$	1,949,266

Liabilities and Stockholders’ Equity
Interest bearing liabilities:
Interest bearing demand accounts	$	293,979		37	0.05		$	256,958		68	0.11
Savings		8,274		1	0.05			5,631		1	0.05
Money market accounts		539,264		301	0.23			471,154		530	0.46
Time deposits		170,748		545	1.29			332,660		1,407	1.72
Borrowed funds		34,062		187	2.23			35,343		188	2.15
Total interest bearing liabilities		1,046,327		1,071	0.42			1,101,746		2,194	0.81
Noninterest bearing liabilities:
Noninterest bearing liabilities		24,156						24,059
Noninterest bearing deposits		782,747						660,086
Stockholders’ equity		203,971						163,375
Total liabilities and stockholders’ equity	$	2,057,201					$	1,949,266

Net interest spread					6.59	%					4.81	%
Net interest income			$	33,331					$	24,444
Net interest margin⁽³⁾					6.79	%					5.15	%

_______________
⁽¹⁾Annualized.
⁽²⁾Includes nonaccrual loans.
⁽³⁾For the three months ended March 31, 2022 and March 31, 2021, collectively, SBA-PPP loans and credit card loans accounted for 297 and 152 basis points of the reported net interest margin, respectively.

HISTORICAL FINANCIAL HIGHLIGHTS – Unaudited
	Quarter Ended
(dollars in thousands except per share data)	March 31, 2022			December 31, 2021			September 30, 2021			June 30, 2021			March 31, 2021
Earnings:
Net income	$	10,211		$	10,171		$	11,177		$	9,648		$	8,982
Earnings per common share, diluted		0.71			0.71			0.79			0.68			0.65
Net interest margin		6.79	%		6.49	%		6.27	%		5.47	%		5.15	%
Net interest margin, excluding credit cards & SBA-PPP loans ⁽¹⁾		3.82	%		3.70	%		3.52	%		3.55	%		3.63	%
Return on average assets⁽²⁾		2.01	%		1.95	%		2.13	%		1.90	%		1.87	%
Return on average assets, excluding impact of SBA-PPP loans⁽¹⁾⁽²⁾		1.67	%		1.80	%		1.99	%		1.65	%		1.54	%
Return on average equity⁽²⁾		20.30	%		20.66	%		23.87	%		22.36	%		22.30	%
Efficiency ratio		65.12	%		65.83	%		64.10	%		66.37	%		67.11	%
Balance Sheet:
Total portfolio loans receivable, net	$	1,526,256		$	1,523,982		$	1,445,126		$	1,392,471		$	1,312,375
Total deposits		1,862,722			1,797,137			1,921,238			1,917,419			1,863,069
Total assets		2,122,453			2,055,300			2,169,556			2,151,850			2,091,851
Total shareholders’ equity		201,492			197,903			189,080			177,204			167,003
Asset Quality Ratios:
Nonperforming assets to total assets		0.28	%		0.56	%		0.77	%		0.54	%		0.58	%
Nonperforming assets to total assets, excluding the SBA-PPP loans ⁽¹⁾		0.29	%		0.59	%		0.83	%		0.60	%		0.66	%
Nonperforming loans to total loans		0.38	%		0.70	%		0.85	%		0.52	%		0.56	%
Nonperforming loans to portfolio loans ⁽¹⁾		0.39	%		0.75	%		0.94	%		0.60	%		0.67	%
Net charge-offs to average portfolio loans ⁽¹⁾⁽²⁾		0.24	%		0.18	%		0.08	%		0.08	%		0.12	%
Allowance for loan losses to total loans		1.60	%		1.54	%		1.56	%		1.51	%		1.49	%
Allowance for loan losses to portfolio loans ⁽¹⁾		1.65	%		1.65	%		1.71	%		1.73	%		1.79	%
Allowance for loan losses to non-performing loans		422.65	%		220.40	%		182.48	%		287.40	%		267.07	%
Bank Capital Ratios:
Total risk based capital ratio		14.36	%		13.79	%		13.86	%		13.51	%		13.55	%
Tier 1 risk based capital ratio		13.10	%		12.53	%		12.60	%		12.25	%		12.29	%
Leverage ratio		8.74	%		8.36	%		7.83	%		7.58	%		7.54	%
Common equity Tier 1 capital ratio		13.10	%		12.53	%		12.60	%		12.25	%		12.29	%
Tangible common equity		8.11	%		8.36	%		7.57	%		7.17	%		7.01	%
Holding Company Capital Ratios:
Total risk based capital ratio		17.16	%		16.41	%		15.75	%		16.14	%		16.07	%
Tier 1 risk based capital ratio		15.19	%		14.43	%		14.49	%		14.10	%		13.98	%
Leverage ratio		10.25	%		9.73	%		9.12	%		8.78	%		8.84	%
Common equity Tier 1 capital ratio		15.04	%		14.28	%		14.34	%		13.94	%		13.81	%
Tangible common equity		9.49	%		9.63	%		8.72	%		8.23	%		7.98	%
Composition of Loans:
SBA-PPP loans, net	$	51,085		$	108,285		$	137,178		$	202,763		$	267,871
Residential real estate	$	420,242		$	401,607		$	418,205		$	420,015		$	420,461
Commercial real estate		564,725			556,339			502,523			471,807			433,336
Construction real estate		245,722			255,147			251,256			223,832			221,277
Commercial and industrial		177,504			175,956			143,244			158,392			151,410
Credit card, net of reserve		123,750			141,120			134,979			121,410			83,740
Other consumer loans		909			1,033			1,425			1,034			2,991
Portfolio loans receivable	$	1,532,852		$	1,531,202		$	1,451,632		$	1,396,490		$	1,313,215
Deferred origination fees, net		(6,596	)		(7,220	)		(6,506	)		(4,019	)		(840	)
Portfolio loans receivable, net	$	1,526,256		$	1,523,982		$	1,445,126		$	1,392,471		$	1,312,375
Composition of Deposits:
Noninterest bearing	$	825,174		$	787,650		$	833,187		$	828,308		$	771,924
Interest-bearing demand		279,591			330,924			369,812			314,883			300,992
Savings		9,894			6,994			6,682			6,965			6,012
Money markets		585,920			493,919			493,029			484,567			471,303
Time deposits		162,143			177,650			218,528			282,696			312,838
Total Deposits	$	1,862,722		$	1,797,137		$	1,921,238		$	1,917,419		$	1,863,069
Capital Bank Home Loan Metrics:
Origination of loans held for sale	$	110,446		$	158,051		$	217,175		$	265,517		$	353,774
Mortgage loans sold		109,953			178,068			229,111			278,384			400,112
Gain on sale of loans		3,042			4,423			6,108			7,763			12,008
Purchase volume as a % of originations		73.16	%		56.44	%		50.98	%		50.64	%		24.59	%
Gain on sale as a % of loans sold⁽³⁾		2.77	%		2.48	%		2.67	%		2.79	%		3.00	%
Mortgage commissions	$	1,125		$	1,462		$	1,884		$	2,364		$	3,320
OpenSky ^® Portfolio Metrics:
Active customer accounts		630,709			660,397			700,383			707,600			642,272
Secured credit card loans, gross		113,343			131,245			131,289			120,381			85,897
Unsecured credit card loans, gross		12,764			12,135			5,949			3,356			363
Noninterest secured credit card deposits		220,354			229,530			242,405			241,724			215,883

_______________
⁽¹⁾Refer to Appendix for reconciliation of non-GAAP measures.
⁽²⁾Annualized.
⁽³⁾Gain on sale percentage is calculated as gain on sale of loans divided by mortgage loans sold.

Appendix

Reconciliation of Non-GAAP Measures

Return on Average Assets, as Adjusted	Quarters Ended
Dollars in thousands	March 31, 2022			December 31, 2021			September 30, 2021			June 30, 2021			March 31, 2021

Net Income	$	10,211		$	10,171		$	11,177		$	9,648		$	8,982
Less: SBA-PPP loan income		2,066			1,347			1,525			2,272			2,469
Net Income, as Adjusted	$	8,145		$	8,824		$	9,652		$	7,376		$	6,513
Average Total Assets		2,057,201			2,066,283			2,084,772			2,041,232			1,949,266
Less: Average SBA-PPP Loans		83,264			116,595			162,217			250,040			232,371
Average Total Assets, as Adjusted	$	1,973,937		$	1,949,688		$	1,922,555		$	1,791,192		$	1,716,895
Return on Average Assets, as Adjusted		1.67	%		1.80	%		1.99	%		1.65	%		1.54	%

Net Interest Margin, as Adjusted	Quarters Ended
Dollars in thousands	March 31, 2022			December 31, 2021			September 30, 2021			June 30, 2021			March 31, 2021

Net Interest Income	$	33,331		$	32,671		$	32,059		$	27,520		$	24,444
Less Credit card loan income		14,487			15,010			15,086			10,497			7,660
Less SBA-PPP loan income		2,066			1,347			1,525			2,272			2,469
Net Interest Income, as Adjusted	$	16,778		$	16,314		$	15,448		$	14,751		$	14,315
Average Interest Earning Assets		1,990,377			1,996,331			2,026,616			2,016,801			1,923,463
Less Average credit card loans		124,923			131,306			124,771			100,456			92,150
Less Average SBA-PPP loans		83,264			116,595			162,217			250,040			232,371
Total Average Interest Earning Assets, as Adjusted	$	1,782,190		$	1,748,430		$	1,739,628		$	1,666,305		$	1,598,941
Net Interest Margin, as Adjusted		3.82	%		3.70	%		3.52	%		3.55	%		3.63	%

Tangible Book Value per Share	Quarters Ended
Dollars in thousands, except per share amounts	March 31, 2022		December 31, 2021		September 30, 2021		June 30, 2021		March 31, 2021

Total Stockholders’ Equity	$	201,492	$	197,903	$	189,080	$	177,204	$	167,003
Less: Preferred equity		—		—		—		—		—
Less: Intangible assets		—		—		—		—		—
Tangible Common Equity	$	201,492	$	197,903	$	189,080	$	177,204	$	167,003
Period End Shares Outstanding		14,000,520		13,962,334		13,801,936		13,771,615		13,759,218
Tangible Book Value per Share	$	14.39	$	14.17	$	13.70	$	12.87	$	12.14

Allowance for Loan Losses to Total Portfolio Loans	Quarters Ended
Dollars in thousands	March 31, 2022			December 31, 2021			September 30, 2021			June 30, 2021			March 31, 2021

Allowance for Loan Losses	$	25,252		$	25,181		$	24,753		$	24,079		$	23,550
Total Loans		1,577,341			1,632,267			1,582,304			1,595,234			1,578,087
Less: SBA-PPP loans		51,085			108,285			137,178			202,763			265,712
Total Portfolio Loans	$	1,526,256		$	1,523,982		$	1,445,126		$	1,392,471		$	1,312,375
Allowance for Loan Losses to Total Portfolio Loans		1.65	%		1.65	%		1.71	%		1.73	%		1.79	%


Nonperforming Assets to Total Assets, net SBA-PPP Loans	Quarters Ended
Dollars in thousands	March 31, 2022			December 31, 2021			September 30, 2021			June 30, 2021			March 31, 2021

Total Nonperforming Assets	$	5,975		$	11,512		$	16,801		$	11,615		$	12,112
Total Assets		2,122,453			2,055,300			2,169,556			2,151,850			2,091,851
Less: SBA-PPP loans		51,085			108,285			137,178			202,763			265,712
Total Assets, net SBA-PPP Loans	$	2,071,368		$	1,947,015		$	2,032,378		$	1,949,087		$	1,826,139
Nonperforming Assets to Total Assets, net SBA-PPP Loans		0.29	%		0.59	%		0.83	%		0.60	%		0.66	%


Nonperforming Loans to Portfolio Loans	Quarters Ended
Dollars in thousands	March 31, 2022			December 31, 2021			September 30, 2021			June 30, 2021			March 31, 2021

Total Nonperforming Loans	$	5,975		$	11,425		$	13,565		$	8,378		$	8,818
Total Loans		1,577,341			1,632,267			1,582,304			1,595,234			1,578,087
Less: SBA-PPP loans		51,085			108,285			137,178			202,763			265,712
Total Portfolio Loans	$	1,526,256		$	1,523,982		$	1,445,126		$	1,392,471		$	1,312,375
Nonperforming Loans to Total Portfolio Loans		0.39	%		0.75	%		0.94	%		0.60	%		0.67	%


Net Charge-offs to Average Portfolio Loans	Quarters Ended
Dollars in thousands	March 31, 2022			December 31, 2021			September 30, 2021			June 30, 2021			March 31, 2021

Total Net Charge-offs	$	881		$	672		$	301		$	251		$	388
Total Average Loans		1,590,166			1,582,473			1,569,198			1,567,973			1,530,723
Less: Average SBA-PPP loans		83,264			116,595			162,217			250,040			232,371
Total Average Portfolio Loans	$	1,506,902		$	1,465,878		$	1,406,981		$	1,317,933		$	1,298,352
Net Charge-offs to Average Portfolio Loans		0.24	%		0.18	%		0.08	%		0.08	%		0.12	%


Pre-tax, Pre-Provision Net Revenue (“PPNR”)	Quarters Ended
Dollars in thousands	March 31, 2022			December 31, 2021			September 30, 2021			June 30, 2021			March 31, 2021

Net income	$	10,211		$	10,171		$	11,177		$	9,648		$	8,982
Add: Income Tax Expense		3,354			3,522			3,877			3,357			3,143
Add: Provision for Loan Losses		952			1,100			975			781			503
Pre-tax, Pre-Provision Net Revenue (“PPNR”)	$	14,517		$	14,793		$	16,029		$	13,786		$	12,628

ABOUT CAPITAL BANCORP, INC.

Capital Bancorp, Inc., Rockville, Maryland is a registered bank holding company incorporated under the laws of Maryland. The Company’s wholly-owned subsidiary, Capital Bank, N.A., is the fourth largest bank headquartered in Maryland at March 31, 2022. Capital Bancorp has been providing financial services since 1999 and now operates bank branches in five locations in the greater Washington, D.C. and Baltimore, Maryland markets. Capital Bancorp had assets of approximately $2.1 billion at March 31, 2022 and its common stock is traded in the NASDAQ Global Market under the symbol “CBNK.” More information can be found at the Company’s website www.CapitalBankMD.com under its investor relations page.

FORWARD-LOOKING STATEMENTS

This earnings release contains forward-looking statements. These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. Any statements about our management’s expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. These statements are often, but not always, made through the use of words or phrases such as “anticipate,” “believes,” “can,” “could,” “may,” “predicts,” “potential,” “should,” “will,” “estimate,” “plans,” “projects,” “continuing,” “ongoing,” “expects,” “optimistic,” “intends” and similar words or phrases. Any or all of the forward-looking statements in this earnings release may turn out to be inaccurate. The inclusion of forward-looking information in this earnings release should not be regarded as a representation by us or any other person that the future plans, estimates or expectations contemplated by us will be achieved. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy and financial needs. Our actual results could differ materially from those anticipated in such forward-looking statements. Accordingly, we caution you that any such forward-looking statements are not a guarantee of future performance and that actual results may prove to be materially different from the results expressed or implied by the forward-looking statements due to a number of factors. For details on some of the factors that could affect these expectations, see risk factors and other cautionary language included in the Company’s Annual Report on Form 10-K and other periodic and current reports filed with the Securities and Exchange Commission.

While there is no assurance that any list of risks and uncertainties or risk factors is complete, below are certain factors which could cause actual results to differ materially from those contained or implied in the forward-looking statements: changes in general economic, political, or industry conditions; geopolitical concerns, including the ongoing war in Ukraine; the magnitude and duration of the COVID-19 pandemic and related variants and mutations and their impact on the global economy and financial market conditions and our business, results of operations, and financial condition; uncertainty in U.S. fiscal and monetary policy, including the interest rate policies of the Board of Governors of the Federal Reserve System; inflation/deflation, interest rate, market, and monetary fluctuations; volatility and disruptions in global capital and credit markets; the transition away from USD LIBOR and uncertainty regarding potential alternative reference rates, including SOFR; competitive pressures on product pricing and services; success, impact, and timing of our business strategies, including market acceptance of any new products or services; the impact of changes in financial services policies, laws, and regulations, including those concerning taxes, banking, securities, and insurance, and the application thereof by regulatory bodies; cybersecurity threats and the cost of defending against them, including the costs of compliance with potential legislation to combat cybersecurity at a state, national, or global level; and other factors that may affect our future results.

These forward-looking statements are made as of the date of this communication, and the Company does not intend, and assumes no obligation, to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events or circumstances, except as required by law.

FINANCIAL CONTACT: Alan Jackson (240) 283-0402

MEDIA CONTACT: Ed Barry (240) 283-1912

WEB SITE: www.CapitalBankMD.com

April 20, 2022 4:48 pm

ASGN Releases 2021 Environmental Social Governance Report

ASGN Releases 2021 Environmental Social Governance Report

RICHMOND, Va.–(BUSINESS WIRE)–
ASGN Incorporated (NYSE: ASGN), a leading provider of IT services and solutions, including technology, creative, and digital, across the commercial and government sectors, today announced the release of its third annual Environmental Social Governance (ESG) Report.

“We made remarkable progress against our ESG objectives this past year, adhering to the priorities we laid out in our 2020 Report, while also introducing new efforts to continue to push forward our commitment to the highest standards of sustainability and corporate purpose,” said Ted Hanson, ASGN’s Chief Executive Officer. “Importantly, in May 2021, ASGN became a corporate participant in the United Nations Global Compact (UNGC), joining over 13,000 companies in aligning our strategies and operations with universal principles on human rights, labor, environment and anti-corruption. We also significantly augmented our disclosures by leveraging new reporting frameworks, including the Global Reporting Initiative (GRI), the Task Force on Climate-Related Financial Disclosure (TCFD) and the UNGC’s Communication on Progress (CoP), as well as implemented comprehensive policies on Anti-Corruption, Board Diversity, and Human Rights.”

Mr. Hanson continued, “ASGN remains committed to continually furthering our progress, and so we have established a new set of expectations for 2022 that will, amongst other objectives, broaden the diversity of our senior executives and suppliers, standardize our data security platforms and bring ASGN closer to reducing our carbon emissions per our 2019 baseline. I could not be prouder of how far we’ve come, and I would like to thank our entire team for their dedication to our Company, our clients and our communities enabling us to advance our ESG goals.”

For more information about ASGN’s sustainability commitments and to view the Company’s 2021 ESG Report please visit asgn.com/sustainability.

About ASGN Incorporated

ASGN Incorporated (NYSE: ASGN) is a leading provider of IT services and solutions, including technology, creative, and digital, across the commercial and government sectors. ASGN helps corporate enterprises and government organizations develop, implement and operate critical IT and business solutions through its integrated offering of professional staffing and IT solutions. For more information, visit us at asgn.com.

Safe Harbor

Certain statements made in this press release are “forward-looking statements” within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and involve a high degree of risk and uncertainty. Forward looking statements may include statements regarding our anticipated financial and operating performance as well as those related to our sustainability targets, goals, commitments and programs. All statements in this press release, other than those setting forth strictly historical information, are forward-looking statements. Forward-looking statements are not guarantees of future performance and actual results might differ materially. In particular, we make no assurances of the achievement of our environmental, social or governance targets, goals or commitments. Such risks, uncertainties and factors include the risk factors discussed in our most recent Annual Report on Form 10-K for the year ended December 31, 2021 as filed with the SEC on March 1, 2022 and Current Reports on Form 8-K also filed with the SEC. The forward-looking statements in this release are made as of today, and we specifically disclaim any intention or duty to update any forward-looking statements contained in this press release to reflect subsequent events or circumstances.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220420006127/en/

ESG

Adam Bleibtreu

Chief Marketing Officer

818-878-7900

[email protected]

Investors

Kimberly Esterkin

Addo Investor Relations

310-829-5400

[email protected]

KEYWORDS: Virginia United States North America

INDUSTRY KEYWORDS: Professional Services Technology Other Technology Human Resources Software Consulting

MEDIA:

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