Market Newsdesk

April 23, 2021 6:03 am

VistaJet records an 81% increase in flights to Hawaii, and substantial uptick across North American destinations

West Coast, Caribbean and Mexico are poised
for a considerable comeback to pre-pandemic levels

New York, April
23
, 2021: VistaJet, the first and only global business aviation company, today announced a substantial uptick of inbound flights to popular travel markets, including traditional private aviation business and leisure destinations like Los Angeles and Las Vegas.

Reflecting yet another positive indication of the travel industry’s rebound, it also further demonstrates the continued reliance on private travel as health and safety remains top-of-mind among American travelers. Nearly 80% of UHNW individuals are more inclined than before to travel by private jet¹, which they consider a safer and more reliable flight solution.

Below are five destinations where VistaJet has experienced a noticeable uptick in demand:

California: VistaJet recorded a 57% increase in traffic to the greater Los Angeles area when comparing January to February 2021.
- Outbound: Additionally, there has been a 7% increase in the number of flights departing the Bay Area when comparing pre-pandemic January 2019 to 2021. Travel from the local area to international destinations include Central America, the Caribbean and Japan.
British Virgin Islands: Service to the British Virgin Islands has more than doubled. VistaJet expects traffic into this region to continue to be in high demand as customers look to explore, relax and reconnect in more remote destinations.
Hawaii: Traffic into the islands increased 81% in the first two months of 2021 when comparing to pre-pandemic 2020 traffic. VistaJet expects the increase in traffic to remain consistent as clients look for tropical weather year-round.
Las Vegas: By January 2021, traffic into this region approached pre-pandemic 2020 levels. As of February 2021, VistaJet is seeing international traffic into this region and expects demand throughout the year to significantly increase.
Cabo, Mexico: When comparing fall 2019 to fall 2020, there was a 900% increase in arrivals to Cabo; VistaJet expects this trend to continue for 2021 as customers seek out warm weather.

Leona Qi
,
President
, VistaJet
US said: “Safety and travel have become one in the same, and the private aviation industry experienced a sharp rise in first-time fliers over the past year, including a 29% increase in new Members here at VistaJet — which is still a fraction of the potential market of private jet fliers. As the first and only truly global private aviation company having arranged flights to over 187 countries, VistaJet is poised to be at the forefront of both North American and international travel. We are already seeing an influx of bookings, with demand driving over 50% of our group fleet to the US. Currently, our customers are expressing a heightened interest in North American destinations along the West Coast, Caribbean and Mexico.”

With summer travel around the corner, VistaJet recently unveiled VistaJet Protect, a new industry-first policy. Amid the uncertainly around travel due to COVID-19, VistaJet Protect provides clarity to On Demand customers who wish to plan for the future of travel while reducing risk — waiving cancellation fees up to 48 hours prior to a scheduled departure. Members can also fly confidently knowing VistaJet’s fleet of Global 7500 aircraft feature Pūr Air, the industry’s most sophisticated air purification and circulation system, which provides the fastest replacement of fresh air than any other commercial or private aircraft.

Visit vistajet.com for more information on VistaJet and its Members-only exclusive services.

– Ends –

Information

Christina Moschetti | Quinn PR | [email protected]
Sabrina Prieto | VistaJet | [email protected]

About VistaJet
VistaJet is the first and only global business aviation company. On its fleet of over 70 silver and red business jets, VistaJet has flown corporations, governments and private clients to 187 countries, covering 96% of the world. Founded in 2004, the company pioneered an innovative business model where customers have access to an entire fleet whilst paying only for the hours they fly, free of the responsibilities and asset risks linked to aircraft ownership. VistaJet’s signature Program membership offers customers a bespoke subscription of flight hours on its fleet of mid and long-range jets, to fly them anytime, anywhere.
VistaJet is part of Vista Global Holding — the world’s first private aviation ecosystem, integrating a unique portfolio of companies offering asset-light solutions to cover all key aspects of business aviation.
More VistaJet information and news at vistajet.com

VistaJet Limited is a European air carrier that operates 9H registered aircraft under its Maltese Air Operator Certificate No. MT-17 and is incorporated in Malta under Company Number C 55231.
VistaJet US Inc. is an Air Charter Broker that does not operate aircraft.
VistaJet and its subsidiaries are not U.S. direct carriers. VistaJet-owned and U.S. registered aircraft are operated by properly licensed U.S. air carriers, including XOJET Aviation LLC.

¹ LUXX Media, Ultra Affluent Consumer Survey

Attachments

April 23, 2021 6:03 am

Producing Results: Regions reports first quarter 2021 earnings of $614 million, earnings per share of $0.63

Producing Results: Regions reports first quarter 2021 earnings of $614 million, earnings per share of $0.63

Delivers strong revenue and pre-tax pre-provision income⁽¹⁾ growth over the prior year

BIRMINGHAM, Ala.–(BUSINESS WIRE)–
Regions Financial Corporation (NYSE:RF) today announced earnings for the first quarter ended March 31, 2021. The company reported net income available to common shareholders of $614 million, and earnings per diluted share of $0.63. Compared to the first quarter of 2020, strong revenue growth contributed to an 18 percent increase in pre-tax pre-provision income on a reported basis and a 17 percent increase on an adjusted basis⁽¹⁾. The company also generated positive operating leverage of 2.6 percent on a reported basis and 2.1 percent on an adjusted basis⁽¹⁾ versus the comparable prior-year period.

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20210423005081/en/

“Our ability to continue to deliver value in the first quarter is a testament to both the investments we’ve made as well as our associates’ unwavering commitment to our customers and communities. With a 14 percent increase in total revenue compared to the first quarter of 2020, it is clear that our investments are producing solid results,” said John Turner, president and CEO.

“We have remained committed to prudent credit risk management across all our portfolios. The resiliency of our credit metrics reflects our clear and deliberate strategy which includes a focus on client selectivity as we are committed to generating appropriate risk-adjusted returns,” Turner added. “We’re pleased with the strength of our pipelines and the increase in business activity across industries. We’re also encouraged by vaccination rates and rebounding employment across our footprint. While we are all still dealing with the lingering effects of the pandemic, our ongoing conversations with customers reflect optimism about further economic recovery and growth. We’ll continue to deepen our relationships with customers by providing personalized solutions and financial guidance combined with technology solutions that make banking easier.”

SUMMARY OF FIRST QUARTER 2021 RESULTS:

	Quarter Ended
(amounts in millions, except per share data)	3/31/2021			12/31/2020			3/31/2020
Net income	$	642		$	616		$	162
Preferred dividends	28			28			23
Net income available to common shareholders	$	614		$	588		$	139


Weighted-average diluted shares outstanding	968			965			961
Actual shares outstanding—end of period	961			960			957

Diluted earnings per common share	$	0.63		$	0.61		$	0.14

Selected items impacting earnings:
Pre-tax adjusted items⁽¹⁾:
Adjustments to non-interest expense⁽¹⁾	$	(10	)	$	(57	)	$	(12	)
Adjustments to non-interest income⁽¹⁾	4			31			2
Total pre-tax adjusted items⁽¹⁾	$	(6	)	$	(26	)	$	(10	)

Diluted EPS impact*	$	—		$	(0.01	)	$	(0.01	)

Pre-tax additional selected items**:
CECL provision less than (in excess of) net charge-offs	$	225		$	132		$	(250	)
Capital markets income – CVA/DVA	11			8			(34		)
MSR net hedge performance	7			(6		)	14
PPP loans interest income***	40			54			—
COVID-19 related expenses	—			(3		)	—
Reduction in unrecognized tax benefits	—			24			—

—
*	Based on income taxes at an approximate 25% incremental rate. Tax rates associated with leveraged lease terminations are incrementally higher based on their structure. Fourth quarter of 2020 gain associated with the exchange of bank-owned life insurance policies is tax free.
**	Items impacting results or trends during the quarter, but are not considered non-GAAP adjustments. These items generally include market-related measures, impacts of new accounting guidance, or event driven actions.
***	Interest income for PPP loans includes estimated funding costs.

Compared to the fourth quarter of 2020, annualized net charge-offs decreased 3 basis points to 0.40 percent of average loans, while total non-performing loans, total delinquencies and business services criticized loans all declined modestly. The allowance for credit losses decreased 25 basis points to 2.44 percent of total loans, representing 280 percent of non-performing loans, excluding loans held for sale. Excluding PPP loans, which are fully government guaranteed, the allowance for credit losses was 2.57 percent⁽¹⁾of total loans. Improvement in macroeconomic variables, recent government stimulus programs, as well as favorable credit performance led to the reduction in the allowance for credit losses during the quarter. The overall allowance reduction resulted in a net $142 million benefit to the credit loss provision during the quarter.

Compared to the fourth quarter of 2020, total revenue decreased approximately 5 percent on a reported basis and 3 percent on an adjusted basis⁽¹⁾ during the first quarter of 2021, reflecting decreases in both net interest income and non-interest income. Net interest income was negatively impacted during the quarter by lower Paycheck Protection Program (“PPP”) interest income and fewer days in the quarter. Excluding these items, net interest income decreased modestly attributable to lower loan balances and the remixing out of higher yielding consumer indirect categories. At the same time, net interest income benefited from the company’s significant hedging program, deposit cost reductions and active cash management strategies, offsetting the impacts of low interest rates. Non-interest income decreased 6 percent driven primarily by a decline in bank-owned life insurance resulting from a gain on policy exchanges in the prior quarter. Wealth management and mortgage income increased 2 percent and 20 percent, respectively, while capital markets income remained very strong but was lower following a record fourth quarter. Non-interest expense decreased 6 percent during the quarter on a reported basis and 1 percent on an adjusted basis⁽¹⁾, driven by decreases in salaries and benefits. The company’s first quarter efficiency ratio was 57.3 percent on a reported basis and 56.8 percent on an adjusted basis⁽¹⁾. Pre-tax pre-provision income⁽¹⁾ decreased 3 percent on a reported basis compared to the fourth quarter of 2020, and 5 percent on an adjusted basis⁽¹⁾, but increased 18 percent and 17 percent⁽¹⁾, respectively versus the first quarter of 2020.

Non-GAAP adjusted items⁽¹⁾ impacting the company’s earnings are identified to assist investors in analyzing Regions’ operating results on the same basis as that applied by management and provide a basis to predict future performance. Non-GAAP adjusted items⁽¹⁾ in the current quarter reflect, among other items, $3 million of severance charges within salaries and benefits, a $5 million loss on branch and other equipment costs and a $2 million contribution to the Regions Foundation. Partially offsetting these adjusted items was a $3 million gain on an equity investment that was sold during the quarter.

Total revenue

	Quarter Ended
($ amounts in millions)	3/31/2021			12/31/2020			3/31/2020			1Q21 vs. 4Q20					1Q21 vs. 1Q20
Net interest income	$	967		$	1,006		$	928		$	(39	)	(3.9	)%	$	39		4.2	%
Taxable equivalent adjustment	11			11			12			—			—	%	(1		)	(8.3	)%
Net interest income, taxable equivalent basis	$	978		$	1,017		$	940		$	(39	)	(3.8	)%	$	38		4.0	%
Net interest margin (FTE)	3.02		%	3.13		%	3.44		%
Adjusted net interest margin (FTE) (non-GAAP)⁽¹⁾	3.40		%	3.40		%	3.49		%

Non-interest income:
Service charges on deposit accounts	$	157		$	160		$	178		(3		)	(1.9	)%	(21		)	(11.8	)%
Card and ATM fees	115			117			105			(2		)	(1.7	)%	10			9.5	%
Wealth management income	91			89			84			2			2.2	%	7			8.3	%
Capital markets income	100			110			9			(10		)	(9.1	)%	91			NM
Mortgage income	90			75			68			15			20.0	%	22			32.4	%
Commercial credit fee income	22			22			18			—			—	%	4			22.2	%
Bank-owned life insurance	17			43			17			(26		)	(60.5	)%	—			—	%
Securities gains (losses), net	1			—			—			1			NM		1			NM
Market value adjustments on employee benefit assets*	7			7			(25		)	—			—	%	32			128.0	%
Gains on equity investment**	3			6			—			(3		)	(50.0	)	3			NM
Other	38			51			31			(13		)	(25.5	)%	7			22.6	%
Non-interest income	$	641		$	680		$	485		$	(39	)	(5.7	)%	$	156		32.2	%
Total revenue	$	1,608		$	1,686		$	1,413		$	(78	)	(4.6	)%	$	195		13.8	%

Adjusted total revenue (non-GAAP)⁽¹⁾	$	1,604		$	1,655		$	1,411		$	(51	)	(3.1	)%	$	193		13.7	%

NM – Not Meaningful

* These market value adjustments relate to assets held for employee benefits that are offset within salaries and employee benefits expense.

** The first quarter of 2021 amount reflects a gain on sale of an equity investment, whereas the prior quarters reflect valuation gains.

Total revenue of approximately $1.6 billion decreased 5 percent on a reported basis and 3 percent on an adjusted basis⁽¹⁾compared to the fourth quarter of 2020. Net interest income decreased 4 percent, while net interest margin decreased 11 basis points. The decrease in net interest income was primarily attributable to lower PPP interest income stemming from a temporary closure of the Small Business Administration portal during the quarter, as well as two fewer days in the quarter. Excluding the impacts of PPP and days, net interest income was negatively impacted by lower loan balances and the remixing out of higher yielding consumer indirect categories. The company offset pressure on asset yields from the low rate environment through its interest rate hedging program, a continued focus on lower deposit costs and active cash management strategies. Strong deposit growth trends continued, as cash balances rose to record levels, negatively impacting net interest margin. Excluding the impact of PPP interest income and excess cash balances held at the Federal Reserve, the company’s adjusted net interest margin⁽¹⁾ remained stable at 3.40 percent.

Non-interest income decreased approximately 6 percent on a reported basis and 2 percent on an adjusted basis⁽¹⁾ compared to the fourth quarter of 2020. Increases in mortgage and wealth management income were offset by declines in most other categories. Mortgage income increased to $90 million driven primarily by agency gain on sale and favorable mortgage servicing rights valuation. Wealth management income increased 2 percent reflecting higher sales volumes and improved market values. Capital markets experienced another strong quarter with income of $100 million. Almost every area within capital markets produced stronger than expected results as customers responded to interest rate changes and potential regulatory and tax headwinds. Service charges decreased 2 percent reflecting both seasonal declines and the impact of additional government stimulus while card and ATM fees decreased 2 percent. Additionally, bank-owned life insurance decreased to $17 million reflecting the impact of a gain associated with a policy exchange completed during the prior quarter.

Non-interest expense

	Quarter Ended
($ amounts in millions)	3/31/2021		12/31/2020		3/31/2020		1Q21 vs. 4Q20					1Q21 vs. 1Q20
Salaries and employee benefits	$	546	$	581	$	467	$	(35	)	(6.0	)%	$	79		16.9	%
Net occupancy expense	77		78		79		(1		)	(1.3	)%	(2		)	(2.5	)%
Equipment and software expense	90		90		83		—			—	%	7			8.4	%
Outside services	38		37		45		1			2.7	%	(7		)	(15.6	)%
Professional, legal and regulatory expenses	29		21		18		8			38.1	%	11			61.1	%
Marketing	22		26		24		(4		)	(15.4	)%	(2		)	(8.3	)%
FDIC insurance assessments	10		12		11		(2		)	(16.7	)%	(1		)	(9.1	)%
Credit/checkcard expenses	14		13		13		1			7.7	%	1			7.7	%
Branch consolidation, property and equipment charges	5		7		11		(2		)	(28.6	)%	(6		)	(54.5	)%
Visa class B shares expense	4		6		4		(2		)	(33.3	)%	—			—	%
Loss on early extinguishment of debt	—		14		—		(14		)	(100.0	)%	—			NM
Other	93		102		81		(9		)	(8.8	)%	12			14.8	%
Total non-interest expense	$	928	$	987	$	836	$	(59	)	(6.0	)%	$	92		11.0	%
Total adjusted non-interest expense⁽¹⁾	$	918	$	930	$	824	$	(12	)	(1.3	)%	$	94		11.4	%

NM – Not Meaningful

Non-interest expense decreased 6 percent on a reported basis and 1 percent on an adjusted basis⁽¹⁾ compared to the fourth quarter of 2020. Salaries and benefits decreased 6 percent. Excluding the impact of severance charges, salaries and benefits decreased 2 percent driven primarily by a reduction in production-based incentives. Overall base salaries were also lower as the company continued to build greater efficiencies through its ongoing continuous improvement process focused on making banking easier for customers and associates. Other expenses decreased 9 percent resulting primarily from a large contribution to the Regions Foundation in the fourth quarter. Partially offsetting these decreases was a 38 percent increase in professional fees driven by higher legal and consulting costs.

The company’s first quarter efficiency ratio was 57.3 percent on a reported basis and 56.8 percent on an adjusted basis⁽¹⁾. The effective tax rate was 21.9 percent.

Loans and Leases

	Average Balances

($ amounts in millions)	1Q21		4Q20		1Q20		1Q21 vs. 4Q20					1Q21 vs. 1Q20
Commercial and industrial	$	42,816	$	43,889	$	40,519	$	(1,073	)	(2.4	)%	$	2,297		5.7	%
Commercial real estate—owner-occupied	5,678		5,708		5,832		(30		)	(0.5	)%	(154		)	(2.6	)%
Investor real estate	7,222		7,448		6,648		(226		)	(3.0	)%	574			8.6	%
Business Lending	55,716		57,045		52,999		(1,329		)	(2.3	)%	2,717			5.1	%
Residential first mortgage	16,606		16,433		14,469		173			1.1	%	2,137			14.8	%
Home equity	7,085		7,411		8,275		(326		)	(4.4	)%	(1,190		)	(14.4	)%
Indirect—vehicles*	850		1,023		1,679		(173		)	(16.9	)%	(829		)	(49.4	)%
Indirect—other consumer**	2,352		2,514		3,263		(162		)	(6.4	)%	(911		)	(27.9	)%
Consumer credit card	1,151		1,190		1,348		(39		)	(3.3	)%	(197		)	(14.6	)%
Other consumer	995		1,048		1,216		(53		)	(5.1	)%	(221		)	(18.2	)%
Consumer Lending	29,039		29,619		30,250		(580		)	(2.0	)%	(1,211		)	(4.0	)%
Total Loans	$	84,755	$	86,664	$	83,249	$	(1,909	)	(2.2	)%	$	1,506		1.8	%

Adjusted Business Lending (non-GAAP)⁽¹⁾	$	51,918	$	52,665	$	52,999	(747		)	(1.4	)%	$	(1,081	)	(2.0	)%
Adjusted Consumer Lending (non-GAAP)⁽¹⁾	27,155		27,432		26,875		(277		)	(1.0	)%	280			1.0	%
Adjusted Total Loans (non-GAAP)⁽¹⁾	$	79,073	$	80,097	$	79,874	$	(1,024	)	(1.3	)%	$	(801	)	(1.0	)%

NM – Not meaningful.

* Indirect vehicles is an exit portfolio.

** A portion of indirect other consumer is an exit portfolio due to the company’s decision not to renew a 3rd party relationship in the fourth quarter of 2019.

Average loans and leases decreased approximately 2 percent compared to the prior quarter. Excluding the company’s indirect auto and indirect-other consumer exit portfolios, outstanding PPP loans, and certain commercial loans transferred to held for sale during the fourth quarter of 2020, adjusted average loans and leases⁽¹⁾ decreased approximately 1 percent. Adjusted business lending⁽¹⁾ decreased 1 percent driven by excess liquidity, customers’ continued use of capital markets and further deleveraging. Commercial loan line utilization levels ended the quarter at approximately 39 percent, well below pre-pandemic trends. Excluding exit portfolios, adjusted consumer lending⁽¹⁾ decreased 1 percent as growth in residential first mortgage was offset by declines in other categories.

Deposits

	Average Balances

($ amounts in millions)	1Q21		4Q20		1Q20		1Q21 vs. 4Q20					1Q21 vs. 1Q20
Customer low-cost deposits	$	117,775	$	114,158	$	87,451	$	3,617		3.2	%	$	30,324		34.7	%
Customer time deposits	5,158		5,598		7,302		(440		)	(7.9	)%	(2,144		)	(29.4	)%
Corporate treasury time deposits	4		11		280		(7		)	(63.6	)%	(276		)	(98.6	)%
Corporate treasury other deposits	—		—		639		—			NM		(639		)	(100.0	)%
Total Deposits	$	122,937	$	119,767	$	95,672	$	3,170		2.6	%	$	27,265		28.5	%

($ amounts in millions)	1Q21		4Q20		1Q20		1Q21 vs. 4Q20					1Q21 vs. 1Q20
Consumer Bank Segment	$	72,949	$	69,912	$	59,711	$	3,037		4.3	%	$	13,238		22.2	%
Corporate Bank Segment	40,285		40,581		26,618		(296		)	(0.7	)%	13,667			51.3	%
Wealth Management Segment	9,281		8,884		8,073		397			4.5	%	1,208			15.0	%
Other	422		390		1,270		32			8.2	%	(848		)	(66.8	)%
Total Deposits	$	122,937	$	119,767	$	95,672	$	3,170		2.6	%	$	27,265		28.5	%

Total average deposit balances increased 3 percent to a new record high in the first quarter of 2021. Growth was led by the Consumer segment reflecting the impact from recent government stimulus payments.

Asset quality

	As of and for the Quarter Ended
($ amounts in millions)	3/31/2021	12/31/2020	3/31/2020
ACL/Loans, net	2.44%	2.69%	1.89%
ALL/Loans, net	2.33%	2.54%	1.77%
Allowance for credit losses to non-performing loans, excluding loans held for sale	280%	308%	261%
Allowance for loan losses to non-performing loans, excluding loans held for sale	268%	291%	244%
Provision for (benefit from) credit losses	$(142)	$(38)	$373
Net loans charged-off	$83	$94	$123
Net loan charge-offs as a % of average loans, annualized	0.40%	0.43%	0.59%
Non-accrual loans, excluding loans held for sale/Loans, net	0.87%	0.87%	0.72%
NPAs (ex. 90+ past due)/Loans, foreclosed properties, non-marketable investments and non-performing loans held for sale	0.90%	0.91%	0.79%
NPAs (inc. 90+ past due)/Loans, foreclosed properties, non-marketable investments and non-performing loans held for sale*	1.09%	1.10%	0.96%
Total TDRs, excluding loans held for sale	$577	$602	$599
Total Criticized Loans—Business Services^**	$3,756	$3,800	$2,524

* Excludes guaranteed residential first mortgages that are 90+ days past due and still accruing.

** Business services represents the combined total of commercial and investor real estate loans.

Improvement in macroeconomic variables, recent government stimulus programs, as well as credit metrics continuing to perform better than anticipated, resulted in a net $142 million benefit to the credit loss provision during the first quarter of 2021. The resulting allowance for credit losses was equal to 2.44 percent of total loans and 280 percent of total non-accrual loans, excluding loans held for sale. Excluding PPP loans, which are fully government guaranteed, the allowance for credit losses amounted to 2.57 percent⁽¹⁾ of total loans. Annualized net charge-offs decreased 3 basis points to 40 basis points of average loans. The decrease reflects broad-based improvement across the commercial and consumer loan portfolios. Total non-accrual loans, excluding loans held for sale, total delinquencies, and total business services criticized loans all declined modestly.

Capital and liquidity

	As of and for Quarter Ended
	3/31/2021	12/31/2020	3/31/2020
Common Equity Tier 1 ratio⁽²⁾	10.3%	9.8%	9.4%
Tier 1 capital ratio⁽²⁾	11.9%	11.4%	10.6%
Tangible common stockholders’ equity to tangible assets (non-GAAP)⁽¹⁾	7.43%	7.91%	8.68%
Tangible common book value per share (non-GAAP)^(1)*	$11.46	$11.71	$11.67
Loans, net of unearned income, to total deposits	65.4%	69.6%	88.1%

* Tangible common book value per share includes the impact of quarterly earnings and changes to market value adjustments within accumulated other comprehensive income, as well as continued capital returns.

Regions maintains a solid capital position as estimated capital ratios remain well above current regulatory requirements. The Tier 1⁽²⁾ and Common Equity Tier 1⁽²⁾ ratios were estimated at 11.9 percent and 10.3 percent, respectively, at quarter-end.

The company declared $149 million in dividends to common shareholders during the first quarter of 2021. The company did not repurchase shares in the quarter.

Although not required, the company will participate in the Federal Reserve Supervisory Stress Test administered during the first half of 2021. During the Supervisory Stress Test Resubmission, results of which were received in December, Regions exceeded all minimum capital levels under the provided scenarios. Regions’ robust capital planning process is designed to ensure efficient use of capital to support lending activities and appropriate shareholder returns.


(1)	Non-GAAP; refer to pages 5, 6, 9, 10, 12, 16, 18 and 21 of the financial supplement to this earnings release.
(2)	Current quarter Common Equity Tier 1, and Tier 1 capital ratios are estimated.

Conference Call

In addition to the live audio webcast at 10 a.m. ET on April 23, 2021, an archived recording of the webcast will be available at the Investor Relations page of www.regions.com following the live event. A replay of the earnings call will also be available beginning Friday, April 23, 2021, at 2:30 p.m. ET through Sunday, May 23, 2021. To listen by telephone, please dial 855-859-2056, and use access code 8791000.

About Regions Financial Corporation

Regions Financial Corporation (NYSE:RF), with $153 billion in assets, is a member of the S&P 500 Index and is one of the nation’s largest full-service providers of consumer and commercial banking, wealth management, and mortgage products and services. Regions serves customers across the South, Midwest and Texas, and through its subsidiary, Regions Bank, operates more than 1,300 banking offices and approximately 2,000 ATMs. Regions Bank is an Equal Housing Lender and Member FDIC. Additional information about Regions and its full line of products and services can be found at www.regions.com.

Forward-Looking Statements

This release may include forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not based on historical information, but rather are related to future operations, strategies, financial results or other developments. Forward-looking statements are based on management’s current expectations as well as certain assumptions and estimates made by, and information available to, management at the time the statements are made. Those statements are based on general assumptions and are subject to various risks, and because they also relate to the future they are likewise subject to inherent uncertainties and other factors that may cause actual results to differ materially from the views, beliefs and projections expressed in such statements. Therefore, we caution you against relying on any of these forward-looking statements. These risks, uncertainties and other factors include, but are not limited to, those described below:

Current and future economic and market conditions in the United States generally or in the communities we serve (in particular the Southeastern United States), including the effects of possible declines in property values, increases in unemployment rates, financial market disruptions and potential reductions of economic growth, which may adversely affect our lending and other businesses and our financial results and conditions.
Possible changes in trade, monetary and fiscal policies of, and other activities undertaken by, governments, agencies, central banks and similar organizations, which could have a material adverse effect on our earnings.
Possible changes in market interest rates or capital markets could adversely affect our revenue and expense, the value of assets and obligations, and the availability and cost of capital and liquidity.
The impact of pandemics, including the ongoing COVID-19 pandemic, on our businesses, operations, and financial results and conditions. The duration and severity of the ongoing COVID-19 pandemic, which has disrupted the global economy, has and could continue to adversely affect our capital and liquidity position, impair the ability of borrowers to repay outstanding loans and increase our allowance for credit losses, impair collateral values, and result in lost revenue or additional expenses. The pandemic could also cause an outflow of deposits, result in goodwill impairment charges and the impairment of other financial and nonfinancial assets, and increase our cost of capital.
Any impairment of our goodwill or other intangibles, any repricing of assets, or any adjustment of valuation allowances on our deferred tax assets due to changes in law, adverse changes in the economic environment, declining operations of the reporting unit or other factors.
The effect of changes in tax laws, including the effect of any future interpretations of or amendments to Tax Reform, which may impact our earnings, capital ratios and our ability to return capital to shareholders.
Possible changes in the creditworthiness of customers and the possible impairment of the collectability of loans and leases, including operating leases.
Changes in the speed of loan prepayments, loan origination and sale volumes, charge-offs, credit loss provisions or actual credit losses where our allowance for credit losses may not be adequate to cover our eventual losses.
Possible acceleration of prepayments on mortgage-backed securities due to low interest rates, and the related acceleration of premium amortization on those securities.
Loss of customer checking and savings account deposits as customers pursue other, higher-yield investments, which could increase our funding costs.
Possible changes in consumer and business spending and saving habits and the related effect on our ability to increase assets and to attract deposits, which could adversely affect our net income.
Our ability to effectively compete with other traditional and non-traditional financial services companies, including fintechs, some of whom possess greater financial resources than we do or are subject to different regulatory standards than we are.
Our inability to develop and gain acceptance from current and prospective customers for new products and services and the enhancement of existing products and services to meet customers’ needs and respond to emerging technological trends in a timely manner could have a negative impact on our revenue.
Our inability to keep pace with technological changes, including those related to the offering of digital banking and financial services, could result in losing business to competitors.
Changes in laws and regulations affecting our businesses, including legislation and regulations relating to bank products and services, as well as changes in the enforcement and interpretation of such laws and regulations by applicable governmental and self-regulatory agencies, including as a result of the recent change in U.S. presidential administration and control of the U.S. Congress, which could require us to change certain business practices, increase compliance risk, reduce our revenue, impose additional costs on us, or otherwise negatively affect our businesses.
Our capital actions, including dividend payments, common stock repurchases, or redemptions of preferred stock or other regulatory capital instruments, must not cause us to fall below minimum capital ratio requirements, with applicable buffers taken into account, and must comply with other requirements and restrictions under law or imposed by our regulators, which may impact our ability to return capital to shareholders.
Our ability to comply with stress testing and capital planning requirements (as part of the CCAR process or otherwise) may continue to require a significant investment of our managerial resources due to the importance of such tests and requirements.
Our ability to comply with applicable capital and liquidity requirements (including, among other things, the Basel III capital standards), including our ability to generate capital internally or raise capital on favorable terms, and if we fail to meet requirements, our financial condition and market perceptions of us could be negatively impacted.
The effects of any developments, changes or actions relating to any litigation or regulatory proceedings brought against us or any of our subsidiaries.
The costs, including possibly incurring fines, penalties, or other negative effects (including reputational harm) of any adverse judicial, administrative, or arbitral rulings or proceedings, regulatory enforcement actions, or other legal actions to which we or any of our subsidiaries are a party, and which may adversely affect our results.
Our ability to manage fluctuations in the value of assets and liabilities and off-balance sheet exposure so as to maintain sufficient capital and liquidity to support our business.
Our ability to execute on our strategic and operational plans, including our ability to fully realize the financial and nonfinancial benefits relating to our strategic initiatives.
The risks and uncertainties related to our acquisition or divestiture of businesses.
The success of our marketing efforts in attracting and retaining customers.
Our ability to recruit and retain talented and experienced personnel to assist in the development, management and operation of our products and services may be affected by changes in laws and regulations in effect from time to time.
Fraud or misconduct by our customers, employees or business partners.
Any inaccurate or incomplete information provided to us by our customers or counterparties.
Inability of our framework to manage risks associated with our business such as credit risk and operational risk, including third-party vendors and other service providers, which could, among other things, result in a breach of operating or security systems as a result of a cyber attack or similar act or failure to deliver our services effectively.
Dependence on key suppliers or vendors to obtain equipment and other supplies for our business on acceptable terms.
The inability of our internal controls and procedures to prevent, detect or mitigate any material errors or fraudulent acts.
The effects of geopolitical instability, including wars, conflicts, civil unrest, and terrorist attacks and the potential impact, directly or indirectly, on our businesses.
The effects of man-made and natural disasters, including fires, floods, droughts, tornadoes, hurricanes, and environmental damage (specifically in the Southeastern United States), which may negatively affect our operations and/or our loan portfolios and increase our cost of conducting business. The severity and impact of future earthquakes, fires, hurricanes, tornadoes, droughts, floods and other weather-related events are difficult to predict and may be exacerbated by global climate change.
Changes in commodity market prices and conditions could adversely affect the cash flows of our borrowers operating in industries that are impacted by changes in commodity prices (including businesses indirectly impacted by commodities prices such as businesses that transport commodities or manufacture equipment used in the production of commodities), which could impair their ability to service any loans outstanding to them and/or reduce demand for loans in those industries.
Our ability to identify and address cyber-security risks such as data security breaches, malware, ransomware,“denial of service” attacks, “hacking” and identity theft, including account take-overs, a failure of which could disrupt our business and result in the disclosure of and/or misuse or misappropriation of confidential or proprietary information, disruption or damage to our systems, increased costs, losses, or adverse effects to our reputation.
Our ability to achieve our expense management initiatives.
Market replacement of LIBOR and the related effect on our LIBOR-based financial products and contracts, including, but not limited to, derivative products, debt obligations, deposits, investments, and loans.
Possible downgrades in our credit ratings or outlook could, among other negative impacts, increase the costs of funding from capital markets.
The effects of a possible downgrade in the U.S. government’s sovereign credit rating or outlook, which could result in risks to us and general economic conditions that we are not able to predict.
The effects of problems encountered by other financial institutions that adversely affect us or the banking industry generally could require us to change certain business practices, reduce our revenue, impose additional costs on us, or otherwise negatively affect our businesses.
The effects of the failure of any component of our business infrastructure provided by a third party could disrupt our businesses, result in the disclosure of and/or misuse of confidential information or proprietary information, increase our costs, negatively affect our reputation, and cause losses.
Our ability to receive dividends from our subsidiaries could affect our liquidity and ability to pay dividends to shareholders.
Changes in accounting policies or procedures as may be required by the FASB or other regulatory agencies could materially affect our financial statements and how we report those results, and expectations and preliminary analyses relating to how such changes will affect our financial results could prove incorrect.
Other risks identified from time to time in reports that we file with the SEC.
Fluctuations in the price of our common stock and inability to complete stock repurchases in the time frame and/or on the terms anticipated.
The effects of any damage to our reputation resulting from developments related to any of the items identified above.

The foregoing list of factors is not exhaustive. For discussion of these and other factors that may cause actual results to differ from expectations, look under the captions “Forward-Looking Statements” and “Risk Factors” of Regions’ Annual Report on Form 10-K for the year ended December 31, 2020 as filed with the SEC.

Further, statements about the potential effects of the COVID-19 pandemic on our businesses and financial results and conditions may constitute forward-looking statements and are subject to the risk that the actual effects may differ, possibly materially, from what is reflected in those forward-looking statements due to factors and future developments that are uncertain, unpredictable and in many cases beyond our control, including the scope and duration of the pandemic (including any second wave or resurgences), actions taken by governmental authorities in response to the pandemic, and the direct and indirect impact of the pandemic on our customers, third parties and us.

The words “future,” “anticipates,” “assumes,” “intends,” “plans,” “seeks,” “believes,” “predicts,” “potential,” “objectives,” “estimates,” “expects,” “targets,” “projects,” “outlook,” “forecast,” “would,” “will,” “may,” “might,” “could,” “should,” “can,” and similar terms and expressions often signify forward-looking statements. You should not place undue reliance on any forward-looking statements, which speak only as of the date made. Factors or events that could cause our actual results to differ may emerge from time to time, and it is not possible to predict all of them. We assume no obligation and do not intend to update or revise any forward-looking statements that are made from time to time, either as a result of future developments, new information or otherwise, except as may be required by law.

Regions’ Investor Relations contact is Dana Nolan at (205) 264-7040; Regions’ Media contact is Jeremy King at (205) 264-4551.

Use of non-GAAP financial measures

Management uses pre-tax pre-provision income (non-GAAP) and adjusted pre-tax pre-provision income (non-GAAP), as well as the adjusted efficiency ratio (non-GAAP) and the adjusted fee income ratio (non-GAAP) to monitor performance and believes these measures provide meaningful information to investors. Non-interest expense (GAAP) is presented excluding certain adjustments to arrive at adjusted non-interest expense (non-GAAP), which is the numerator for the efficiency ratio. Non-interest income (GAAP) is presented excluding certain adjustments to arrive at adjusted non-interest income (non-GAAP), which is the numerator for the fee income ratio. Adjusted non-interest income (non-GAAP) and adjusted non-interest expense (non-GAAP) are used to determine adjusted pre-tax pre-provision income (non-GAAP). Net interest income (GAAP) on a taxable-equivalent basis and non-interest income are added together to arrive at total revenue on a taxable-equivalent basis. Adjustments are made to arrive at adjusted total revenue on a taxable-equivalent basis (non-GAAP), which is the denominator for the fee income and efficiency ratios. Regions believes that the exclusion of these adjustments provides a meaningful basis for period-to-period comparisons, which management believes will assist investors in analyzing the operating results of the Company and predicting future performance. These non-GAAP financial measures are also used by management to assess the performance of Regions’ business. It is possible that the activities related to the adjustments may recur; however, management does not consider the activities related to the adjustments to be indications of ongoing operations. Regions believes that presentation of these non-GAAP financial measures will permit investors to assess the performance of the Company on the same basis as that applied by management.

The allowance for credit losses (ACL) as a percentage of total loans is an important ratio, especially during periods of economic stress. Management believes this ratio provides investors with meaningful additional information about credit loss allowance levels when the impact of SBA’s Paycheck Protection Program loans, which are fully backed by the U.S. government, and any related allowance are excluded from total loans and total allowance which are the denominator and numerator, respectively, used in the ACL ratio. This adjusted ACL ratio represents a non-GAAP financial measure.

Tangible common stockholders’ equity ratios have become a focus of some investors and management believes they may assist investors in analyzing the capital position of the Company absent the effects of intangible assets and preferred stock. Analysts and banking regulators have assessed Regions’ capital adequacy using the tangible common stockholders’ equity measure. Because tangible common stockholders’ equity is not formally defined by GAAP or prescribed in any amount by federal banking regulations it is currently considered to be a non-GAAP financial measure and other entities may calculate it differently than Regions’ disclosed calculations. Since analysts and banking regulators may assess Regions’ capital adequacy using tangible common stockholders’ equity, management believes that it is useful to provide investors the ability to assess Regions’ capital adequacy on this same basis.

Non-GAAP financial measures have inherent limitations, are not required to be uniformly applied and are not audited. Although these non-GAAP financial measures are frequently used by stakeholders in the evaluation of a company, they have limitations as analytical tools, and should not be considered in isolation, or as a substitute for analyses of results as reported under GAAP. In particular, a measure of earnings that excludes selected items does not represent the amount that effectively accrues directly to stockholders.

Management and the Board of Directors utilize non-GAAP measures as follows:

Preparation of Regions’ operating budgets
Monthly financial performance reporting
Monthly close-out reporting of consolidated results (management only)
Presentation to investors of company performance
Metrics for incentive compensation

View source version on businesswire.com: https://www.businesswire.com/news/home/20210423005081/en/

Media Contact:

Jeremy King

(205) 264-4551

Investor Relations Contact:

Dana Nolan

(205) 264-7040

KEYWORDS: Alabama United States North America

INDUSTRY KEYWORDS: Banking Professional Services

MEDIA:

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April 23, 2021 6:03 am

New York City REIT Announces Release Date for First Quarter 2021 Results

New York City REIT Announces Release Date for First Quarter 2021 Results

NEW YORK–(BUSINESS WIRE)–
New York City REIT, Inc. (NYSE: NYC) (“NYC” or the “Company”) announced today it will release its financial results for the first quarter ended March 31, 2021 on Thursday, May 13, 2021 before the start of trading on the New York Stock Exchange.

The Company will host a conference call and audio webcast on Thursday, May 13, 2021, beginning at 11:00 a.m. ET, to discuss the first quarter results and provide commentary on business performance. The call will be conducted by NYC’s management team and a question and answer session with analysts and investors will follow the prepared remarks.

Dial-in instructions for the conference call and the replay are outlined below. This conference call will also be broadcast live over the Internet and can be accessed by all interested parties through the NYC website, www.newyorkcityreit.com, in the “Investor Relations” section. To listen to the live call, please go to the “Investor Relations” section of the Company’s website at least 15 minutes prior to the start of the call to register and download any necessary audio software. For those who are not able to listen to the live broadcast, a replay will be available shortly after the call on the NYC website.

Conference Call Details

Live Call

Dial-In (Toll Free): 1-888-317-6003

International Dial-In: 1-412-317-6061

Canada Dial-In (Toll Free): 1-866-605-3851

Participant Elite Entry Number: 2402508

Conference Replay*

Domestic Dial-In (Toll Free): 1-877-344-7529

International Dial-In: 1-412-317-0088

Canada Dial-In (Toll Free): 855-669-9658

Conference Number: 10155579

*Available one hour after the end of the conference call through August 13, 2021.

About New York City REIT, Inc.

New York City REIT, Inc. is a publicly traded REIT that owns a portfolio of high-quality commercial real estate located within the five boroughs of New York City. Additional information about NYC can be found on its website at www.newyorkcityreit.com.

Forward-Looking Statements

The statements in this press release that are not historical facts may be forward-looking statements. These forward-looking statements involve substantial risks and uncertainties that could cause the outcome to be materially different. In addition, words such as “may,” “will,” “seeks,” “anticipates,” “believes,” “estimates,” “expects,” “plans,” “intends,” “would,” or similar expressions indicate a forward-looking statement, although not all forward-looking statements contain these identifying words. Actual results may differ materially from those contemplated by such forward-looking statements, including those set forth in the “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of NYC’s most recent Annual Report on Form 10-K, as such Risk Factors may be updated from time to time in subsequent reports. Further, forward-looking statements speak only as of the date they are made, and NYC undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time, except as required by law.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210423005099/en/

Investor Relations

[email protected]

(866) 902-0063

KEYWORDS: United States North America New York

INDUSTRY KEYWORDS: Commercial Building & Real Estate Construction & Property REIT

MEDIA:

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April 23, 2021 6:03 am

Southside Bancshares, Inc. Announces Financial Results for the First Quarter Ended March 31, 2021

Record first quarter net income of $34.1 million, an increase of 762.4%, compared to the same period in 2020;
Annualized return on first quarter average assets of 1.99%;
Annualized return on first quarter average tangible common equity of 21.22%⁽¹⁾; and
Nonperforming assets decreased to 0.22% of total assets.

TYLER, Texas, April 23, 2021 (GLOBE NEWSWIRE) — Southside Bancshares, Inc. (“Southside” or the “Company”) (NASDAQ: SBSI) today reported its financial results for the quarter ended March 31, 2021. Southside reported net income of $34.1 million for the three months ended March 31, 2021, an increase of $30.1 million, or 762.4%, compared to $4.0 million for the same period in 2020. Earnings per diluted common share increased $0.92, or 766.7%, to $1.04 for the three months ended March 31, 2021, from $0.12 for the same period in 2020. The annualized return on average shareholders’ equity for the three months ended March 31, 2021 was 15.82%, compared to 1.93% for the same period in 2020. The annualized return on average assets was 1.99% for the three months ended March 31, 2021, compared to 0.23% for the same period in 2020.

“We reported outstanding results for the first quarter, highlighted by record net income, annualized linked quarter loan growth of 6.2%, net of Paycheck Protection Program (“PPP”) loans, continued strong asset quality metrics and annualized linked quarter deposit growth of 13.2%,” stated Lee R. Gibson, President and Chief Executive Officer of Southside.

“Our record net income and earnings per diluted common share were primarily due to the $35.4 million decrease in provision for credit losses, from $25.2 million for the first quarter ended March 31, 2020, compared to a $10.1 million reversal of provision for the same period in 2021. This was largely due to our continued strong asset quality ratios, overall improvement in economic conditions, including lower unemployment levels, and a significant improvement in the economic forecast for March 2021 when compared to March 2020.”

“We entered 2021 with an active loan pipeline, several of which closed and were funded during March, contributing to the 6.2% first quarter annualized loan growth. We are encouraged about potential future loan growth as our pipeline continues to remain healthy. We have been actively participating in the second round of the PPP during 2021, and as of April 21, we have originated approximately 1,000 new loans totaling $105 million for small businesses in the market areas we serve.”

“During February, Texas suffered a major power crisis due to the historic Winter Storm Uri, causing a massive electricity generation failure. This power crisis caused shortages of water, food and heat impacting large portions of the state. In addition, large accumulations of snow and ice created extremely hazardous driving conditions. Our technology facilities continued to operate uninterrupted with the use of backup power systems, allowing those team members with power, to work from home and handle virtually all customer transactions with the assistance of our ATM network for cash needs. Utilizing proven methods and technology, we were able to open the bank virtually until conditions improved with very few team members present and minimal customer inconvenience.”

“Economic conditions in our market areas continue to improve, bolstered by company relocations and population growth due to individuals moving to Texas from other states. During the first quarter we hired additional revenue producers, one in Austin and two in the DFW area to generate additional loan growth.”

Operating Results for the Three Months Ended March 31, 2021

Net income was $34.1 million for the three months ended March 31, 2021, compared to $4.0 million for the same period in 2020, an increase of $30.1 million, or 762.4%. Earnings per diluted common share were $1.04 for the three months ended March 31, 2021, compared to $0.12 for the same period in 2020, an increase of 766.7%. The increase in net income was a direct result of a reversal of the provision for credit losses compared to a large build-up in the allowance for credit losses in the same period in 2020. Annualized returns on average assets and average shareholders’ equity for the three months ended March 31, 2021 were 1.99% and 15.82%, respectively. Our efficiency ratio and tax equivalent efficiency ratio⁽¹⁾ was 53.01% and 50.44%, respectively, for the three months ended March 31, 2021, compared to 49.86% and 47.36%, respectively, for the three months ended December 31, 2020.

Net interest income for the three months ended March 31, 2021 was $46.3 million, compared to $44.7 million for the same period in 2020, an increase of 3.6%. The increase in net interest income compared to the same period in 2020 was due to the decrease in interest expense on our interest bearing liabilities, a result of an overall decline in interest rates, partially offset by a decrease in interest income due to a decrease in the average yield on our interest earning assets during the three months ended March 31, 2021. Linked quarter, net interest income decreased $2.4 million, or 4.9%, compared to $48.7 million during the three months ended December 31, 2020. The decrease in interest income is due to the decrease in the average balance of interest earning assets and the average yield, partially offset by a decline in interest expense driven by the decrease in the average balance of interest bearing liabilities and the average interest rate.

Our net interest margin and tax equivalent net interest margin⁽¹⁾ increased to 3.01% and 3.20%, respectively, for the three months ended March 31, 2021, compared to 2.88% and 3.03%, respectively, for the same period in 2020. Linked quarter net interest margin increased one basis point from 3.00% and tax equivalent net interest margin⁽¹⁾ remained unchanged at 3.20% as compared to the three months ended December 31, 2020.

Noninterest income was $13.6 million for the three months ended March 31, 2021, a decrease of $1.9 million, or 12.1%, compared to $15.5 million for the same period in 2020, due to a $3.5 million decrease in net gain on sale of securities available for sale, partially offset by increases in other noninterest income, gain on sale of loans and brokerage services income. On a linked quarter basis, noninterest income increased $2.7 million, or 25.0%, compared to the three months ended December 31, 2020, due to increases in net gain on sale of securities available for sale, brokerage services income and other noninterest income, partially offset by decreases in deposit services income and gain on sale of loans.

Noninterest expense was $31.2 million for the three months ended March 31, 2021, an increase of $0.7 million, or 2.3%, compared to $30.5 million for the same period in 2020. On a linked quarter basis, noninterest expense decreased $0.1 million, or 0.3%, compared to the three months ended December 31, 2020.

Income tax expense increased $4.3 million for the three months ended March 31, 2021 compared to the same period in 2020. On a linked quarter basis, income tax expense increased $0.5 million, or 11.4%. Our effective tax rate (“ETR”) increased to 12.2% for the three months ended March 31, 2021 compared to 10.8% for the three months ended March 31, 2020 due to a decrease in tax-exempt income as a percentage of pre-tax income. Linked quarter, our ETR decreased compared to 12.6% for the three months ended December 31, 2020, primarily due to $0.1 million of a discrete tax benefit recorded in connection with equity award transactions in the first quarter of 2021.

Balance Sheet Data

At March 31, 2021, we had $7.0 billion in total assets, compared to $7.01 billion at December 31, 2020 and $7.27 billion at March 31, 2020.

Loans at March 31, 2021 were $3.72 billion, an increase of $115.6 million, or 3.2%, compared to $3.60 billion at March 31, 2020. This increase was due to our origination of PPP loans, a component of the commercial loan category, with a balance of $220.9 million at March 31, 2021, offset largely by a decrease in our 1-4 family residential loans. There were no PPP loans outstanding at March 31, 2020. Linked quarter loans increased $58.8 million, or 1.6%, from $3.66 billion at December 31, 2020. The linked quarter net increase in loans consisted primarily of increases of $52.8 million of commercial real estate loans, $23.7 million of construction loans and $7.6 million of commercial loans, partially offset by decreases of $19.5 million of 1-4 family residential loans, $3.2 million of loans to individuals and $2.7 million of municipal loans. On a linked quarter basis, our PPP loans experienced a net increase of $6.0 million, or 2.8%, from $214.8 million at December 31, 2020, due to additional funding under the renewed Economic Aid Act, which was signed into law on December 27, 2020, partially offset by forgiveness payments received from loans funded under the Coronavirus Aid, Relief, and Economic Security Act.

Securities at March 31, 2021 were $2.65 billion, a decrease of $302.4 million, or 10.3%, compared to $2.95 billion at March 31, 2020. The decrease was primarily due to principal pay downs of mortgage-related securities. Linked quarter, securities decreased $51.2 million, or 1.9%, from $2.70 billion at December 31, 2020. The decrease for the linked quarter was primarily a result of the decline in the estimated fair value of the securities portfolio at March 31, 2021, when compared to December 31, 2020.

Deposits at March 31, 2021 were $5.09 billion, an increase of $353.5 million, or 7.5%, compared to $4.74 billion at March 31, 2020. Linked quarter, deposits increased $160.3 million, or 3.3%, from $4.93 billion at December 31, 2020. Both of these increases were largely driven by PPP loan disbursements deposited into our commercial accounts and stimulus checks deposited during the second quarter of 2020 and the first quarter of 2021.

Asset Quality

Nonperforming assets at March 31, 2021 were $15.4 million, or 0.22% of total assets, a decrease of $2.0 million, or 11.7%, compared to $17.4 million, or 0.24% of total assets, at March 31, 2020, and a decrease from $17.5 million, or 0.25% of total assets, at December 31, 2020. During the three months ended March 31, 2021, nonaccrual loans decreased $2.4 million, or 31.1%.

The allowance for loan losses decreased to $41.5 million, or 1.12% of total loans, at March 31, 2021, compared to $53.6 million, or 1.49% of total loans, at March 31, 2020. The allowance for loan losses was $49.0 million, or 1.34% of total loans, at December 31, 2020. The decrease is primarily due to improvement in the economic forecast.

For the three months ended March 31, 2021, we recorded a reversal of provision for credit losses for loans of $7.4 million, compared to a provision for credit losses for loans of $24.1 million for the three months ended March 31, 2020 and a reversal of provision for credit losses of $5.9 million for the three months ended December 31, 2020. The reversal was primarily due to improvement in the economic forecast in the first quarter of 2021 and its effect on macroeconomic factors used in the CECL model. The provision in the first quarter of 2020 was due to the estimated economic impact of COVID-19 on the macroeconomic factors, including the potential for credit deterioration. Net charge-offs were $0.2 million for the three months ended March 31, 2021, compared to net charge-offs of $0.5 million for the three months ended March 31, 2020 and $0.2 million of net charge-offs for the three months ended December 31, 2020.

For the three months ended March 31, 2021, we recorded a reversal of provision for credit losses for off-balance-sheet credit exposures of $2.8 million and provisions of $1.2 million and $0.4 million for the three months ended March 31, 2020 and December 31, 2020, respectively. The balance of the allowance for off-balance-sheet credit exposures at March 31, 2021 was $3.6 million and is included in other liabilities.

Dividend

Southside Bancshares, Inc. declared a first quarter cash dividend of $0.32 per share on February 4, 2021, which was paid on March 4, 2021, to all shareholders of record as of February 18, 2021.



⁽¹⁾	^{Refer to “Non-GAAP Financial Measures” below and to “Non-GAAP Reconciliation” at the end of the financial statement tables in this Earnings Release for more information and for a reconciliation of this non-GAAP financial measure to the nearest GAAP financial measure.}

Conference Call

Southside’s management team will host a conference call to discuss its first quarter ended March 31, 2021 financial results on Friday, April 23, 2021 at 11:00 a.m. CDT. The call can be accessed by dialing 844-775-2540 and by identifying the conference ID number 8276936 or by identifying “Southside Bancshares, Inc., First Quarter 2021 Earnings Call.” To listen to the call via webcast, register at https://investors.southside.com.

For those unable to listen to the conference call live, a recording will be available from approximately 2:00 p.m. CDT April 23, 2021 through 2:00 p.m. CDT May 5, 2021 by accessing the company website, https://investors.southside.com.

Non-GAAP Financial Measures

Our accounting and reporting policies conform to generally accepted accounting principles (“GAAP”) in the United States and prevailing practices in the banking industry. However, certain non-GAAP measures are used by management to supplement the evaluation of our performance. These include the following fully taxable-equivalent measures (“FTE”): (i) Net interest income (FTE), (ii) net interest margin (FTE), (iii) net interest spread (FTE), and (iv) efficiency ratio (FTE), which include the effects of taxable-equivalent adjustments using a federal income tax rate of 21% to increase tax-exempt interest income to a tax-equivalent basis. Interest income earned on certain assets is completely or partially exempt from federal income tax. As such, these tax-exempt instruments typically yield lower returns than taxable investments.

Net interest income (FTE), net interest margin (FTE) and net interest spread (FTE). Net interest income (FTE) is a non-GAAP measure that adjusts for the tax-favored status of net interest income from certain loans and investments and is not permitted under GAAP in the consolidated statements of income. We believe this measure to be the preferred industry measurement of net interest income and that it enhances comparability of net interest income arising from taxable and tax-exempt sources. The most directly comparable financial measure calculated in accordance with GAAP is our net interest income. Net interest margin (FTE) is the ratio of net interest income (FTE) to average earning assets. The most directly comparable financial measure calculated in accordance with GAAP is our net interest margin. Net interest spread (FTE) is the difference in the average yield on average earning assets on a tax-equivalent basis and the average rate paid on average interest bearing liabilities. The most directly comparable financial measure calculated in accordance with GAAP is our net interest spread.

Efficiency ratio (FTE). The efficiency ratio (FTE) is a non-GAAP measure that provides a measure of productivity in the banking industry. This ratio is calculated to measure the cost of generating one dollar of revenue. The ratio is designed to reflect the percentage of one dollar which must be expended to generate that dollar of revenue. We calculate this ratio by dividing noninterest expense, excluding amortization expense on intangibles and certain nonrecurring expense by the sum of net interest income (FTE) and noninterest income, excluding net gain (loss) on sale of securities available for sale and certain nonrecurring impairments. The most directly comparable financial measure calculated in accordance with GAAP is our efficiency ratio.

These non-GAAP financial measures should not be considered alternatives to GAAP-basis financial statements and other bank holding companies may define or calculate these non-GAAP measures or similar measures differently. Whenever we present a non-GAAP financial measure in an SEC filing, we are also required to present the most directly comparable financial measure calculated and presented in accordance with GAAP and reconcile the differences between the non-GAAP financial measure and such comparable GAAP measure.

Management believes adjusting net interest income, net interest margin and net interest spread to a fully taxable-equivalent basis is a standard practice in the banking industry as these measures provide useful information to make peer comparisons. Tax-equivalent adjustments are reflected in the respective earning asset categories as listed in the “Average Balances with Average Yields and Rates” tables.

A reconciliation of our non-GAAP financial measures to the comparable GAAP financial measures is included at the end of the financial statement tables.

About Southside Bancshares, Inc.

Southside Bancshares, Inc. is a bank holding company with approximately $7.0 billion in assets as of March 31, 2021, that owns 100% of Southside Bank. Southside Bank currently has 55 branches in Texas and operates a network of 76 ATMs/ITMs.

To learn more about Southside Bancshares, Inc., please visit our investor relations website at https://investors.southside.com. Our investor relations site provides a detailed overview of our activities, financial information and historical stock price data. To receive e-mail notification of company news, events and stock activity, please register on the E-mail Notification portion of the website. Questions or comments may be directed to Lindsey Bailes at (903) 630-7965, or [email protected].

Forward-Looking Statements

Certain statements of other than historical fact that are contained in this press release and in other written materials, documents and oral statements issued by or on behalf of the Company may be considered to be “forward-looking statements” within the meaning of and subject to the safe harbor protections of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are not guarantees of future performance, nor should they be relied upon as representing management’s views as of any subsequent date. These statements may include words such as “expect,” “estimate,” “project,” “anticipate,” “appear,” “believe,” “could,” “should,” “may,” “might,” “will,” “would,” “seek,” “intend,” “probability,” “risk,” “goal,” “target,” “objective,” “plans,” “potential,” and similar expressions. Forward-looking statements are statements with respect to the Company’s beliefs, plans, expectations, objectives, goals, anticipations, assumptions and estimates about the Company’s future performance and are subject to significant known and unknown risks and uncertainties, which could cause the Company’s actual results to differ materially from the results discussed in the forward-looking statements. For example, discussions about trends in asset quality, capital, liquidity, the pace of loan and revenue growth, the Company’s ability to sell nonperforming assets, expense reductions, planned operational efficiencies, earnings, successful integration of completed acquisitions and certain market risk disclosures, including the impact of interest rates, tax reform and other economic factors, including the impact of the COVID-19 pandemic on the economy and our operations, are based upon information presently available to management and are dependent on choices about key model characteristics and assumptions and are subject to various limitations. By their nature, certain of the market risk disclosures are only estimates and could be materially different from what actually occurs in the future. The most recent factor that could cause future results to differ materially from those anticipated by our forward-looking statements include the negative impact of the COVID-19 pandemic on our business, financial position, operations and prospects, including our ability to continue our business activities in certain communities we serve, the duration of the pandemic and its continued effects on financial markets, a reduction in financial transactions and business activities resulting in decreased deposits and reduced loan originations, increases in unemployment rates impacting our borrowers’ ability to repay their loans, our ability to manage liquidity in a rapidly changing and unpredictable market, additional interest rate changes by the Federal Reserve and other government actions in response to the pandemic, including regulations or laws enacted to counter the effects of the COVID-19 pandemic on the economy.

Additional information concerning the Company and its business, including additional factors that could materially affect the Company’s financial results, is included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020, under “Part I – Item 1. Forward Looking Information” and in the Company’s other filings with the Securities and Exchange Commission. The Company disclaims any obligation to update any factors or to announce publicly the result of revisions to any of the forward-looking statements included herein to reflect future events or developments.

Southside Bancshares, Inc.

Consolidated Financial Summary (Unaudited)

(Dollars in thousands)

	As of
	2021			2020
	Mar 31,			Dec 31,			Sep 30,			Jun 30,			Mar 31,
ASSETS
Cash and due from banks	$	78,304		$	87,357		$	81,643		$	81,271		$	71,727
Interest earning deposits	29,319			21,051			14,561			19,535			40,486
Securities available for sale, at estimated fair value	2,546,924			2,587,305			2,633,519			2,679,521			2,813,024
Securities held to maturity, at net carrying value	98,159			108,998			115,089			120,384			134,491
Total securities	2,645,083			2,696,303			2,748,608			2,799,905			2,947,515
Federal Home Loan Bank stock, at cost	18,754			25,259			35,860			55,689			54,696
Loans held for sale	2,615			3,695			8,686			3,392			1,830
Loans	3,716,598			3,657,779			3,789,975			3,852,571			3,601,002
Less: Allowance for loan losses	(41,454		)	(49,006		)	(55,110		)	(59,868		)	(53,638		)
Net loans	3,675,144			3,608,773			3,734,865			3,792,703			3,547,364
Premises & equipment, net	144,628			144,576			147,169			147,715			146,212
Goodwill	201,116			201,116			201,116			201,116			201,116
Other intangible assets, net	8,978			9,744			10,569			11,450			12,381
Bank owned life insurance	116,209			115,583			114,928			114,248			101,066
Other assets	78,736			94,770			92,955			102,587			149,245
Total assets	$	6,998,886		$	7,008,227		$	7,190,960		$	7,329,611		$	7,273,638

LIABILITIES AND SHAREHOLDERS’ EQUITY
Noninterest bearing deposits	$	1,383,371		$	1,354,815		$	1,363,228		$	1,398,179		$	1,065,708
Interest bearing deposits	3,709,272			3,577,507			3,739,798			3,672,365			3,673,415
Total deposits	5,092,643			4,932,322			5,103,026			5,070,544			4,739,123
Other borrowings and Federal Home Loan Bank borrowings	687,845			855,699			994,512			1,165,463			1,492,270
Subordinated notes, net of unamortized debt issuance costs	197,268			197,251			98,708			98,663			98,619
Trust preferred subordinated debentures, net of unamortized debt issuance costs	60,256			60,255			60,254			60,253			60,251
Other liabilities	102,277			87,403			95,312			117,083			87,575
Total liabilities	6,140,289			6,132,930			6,351,812			6,512,006			6,477,838
Shareholders’ equity	858,597			875,297			839,148			817,605			795,800
Total liabilities and shareholders’ equity	$	6,998,886		$	7,008,227		$	7,190,960		$	7,329,611		$	7,273,638

Southside Bancshares, Inc.

Consolidated Financial Highlights (Unaudited)

(Dollars and shares in thousands, except per share data)

	Three Months Ended
	2021			2020
	Mar 31,			Dec 31,			Sep 30,			Jun 30,			Mar 31,
Income Statement:
Total interest income	$	53,565		$	56,904		$	55,677		$	58,495		$	60,752
Total interest expense	7,262			8,197			9,091			11,224			16,051
Net interest income	46,303			48,707			46,586			47,271			44,701
Provision for credit losses	(10,149		)	(5,545		)	(4,746		)	5,245			25,247
Net interest income after provision for credit losses	56,452			54,252			51,332			42,026			19,454
Noninterest income
Deposit services	6,125			6,419			6,129			5,532			6,279
Net gain (loss) on sale of securities available for sale	2,003			(24		)	78			2,662			5,541
Gain on sale of loans	593			848			1,071			683			170
Trust fees	1,383			1,354			1,253			1,221			1,305
Bank owned life insurance	626			655			680			650			569
Brokerage services	780			628			564			499			580
Other	2,113			1,020			1,366			946			1,054
Total noninterest income	13,623			10,900			11,141			12,193			15,498
Noninterest expense
Salaries and employee benefits	20,044			19,609			19,344			18,629			19,643
Net occupancy	3,560			3,795			3,595			3,668			3,311
Advertising, travel & entertainment	437			504			519			292			832
ATM expense	238			290			271			233			224
Professional fees	991			986			961			1,082			1,195
Software and data processing	1,312			1,220			1,215			1,295			1,227
Communications	525			490			495			506			493
FDIC insurance	454			456			469			174			25
Amortization of intangibles	766			825			881			931			980
Other	2,907			3,140			3,866			3,046			2,590
Total noninterest expense	31,234			31,315			31,616			29,856			30,520
Income before income tax expense	38,841			33,837			30,857			24,363			4,432
Income tax expense	4,750			4,265			3,783			2,809			479
Net income	$	34,091		$	29,572		$	27,074		$	21,554		$	3,953

Common Share Data:
Weighted-average basic shares outstanding	32,829			33,055			33,047			33,016			33,691
Weighted-average diluted shares outstanding	32,937			33,125			33,098			33,083			33,805
Common shares outstanding end of period	32,659			32,951			33,072			33,032			33,012
Earnings per common share
Basic	$	1.04		$	0.89		$	0.82		$	0.65		$	0.12
Diluted	1.04			0.89			0.82			0.65			0.12
Book value per common share	26.29			26.56			25.37			24.75			24.11
Tangible book value per common share ⁽¹⁾	19.86			20.16			18.97			18.32			17.64
Cash dividends paid per common share	0.32			0.37			0.31			0.31			0.31

Selected Performance Ratios:
Return on average assets	1.99		%	1.64		%	1.48		%	1.17		%	0.23		%
Return on average shareholders’ equity	15.82			13.77			12.89			10.82			1.93
Return on average tangible common equity ⁽¹⁾	21.22			18.71			17.73			15.24			3.11
Average yield on earning assets (FTE) ⁽¹⁾	3.67			3.70			3.57			3.69			4.06
Average rate on interest bearing liabilities	0.64			0.68			0.73			0.87			1.30
Net interest margin (FTE) ⁽¹⁾	3.20			3.20			3.02			3.02			3.03
Net interest spread (FTE) ⁽¹⁾	3.03			3.02			2.84			2.82			2.76
Average earning assets to average interest bearing liabilities	135.56			133.56			131.92			129.03			126.22
Noninterest expense to average total assets	1.82			1.74			1.73			1.63			1.78
Efficiency ratio (FTE) ⁽¹⁾	50.44			47.36			50.07			48.29			51.91

⁽¹⁾	^{Refer to “Non-GAAP Reconciliation” at the end of the financial statement tables in this Earnings Release for a reconciliation of this non-GAAP financial measure to the nearest GAAP financial measure.}

Southside Bancshares, Inc.

Consolidated Financial Highlights (Unaudited)

(Dollars in thousands)

	Three Months Ended
	2021			2020
	Mar 31,			Dec 31,			Sep 30,			Jun 30,			Mar 31,
Nonperforming Assets:	$	15,367		$	17,480		$	16,822		$	17,600		$	17,403
Nonaccrual loans	5,314			7,714			5,971			5,639			5,221
Accruing loans past due more than 90 days	—			—			—			—			—
Troubled debt restructured loans	9,641			9,646			10,307			11,367			11,448
Other real estate owned	412			106			536			586			734
Repossessed assets	—			14			8			8			—

Asset Quality Ratios:
Ratio of nonaccruing loans to:
Total loans	0.14		%	0.21		%	0.16		%	0.15		%	0.14		%
Ratio of nonperforming assets to:
Total assets	0.22			0.25			0.23			0.24			0.24
Total loans	0.41			0.48			0.44			0.46			0.48
Total loans and OREO	0.41			0.48			0.44			0.46			0.48
Total loans, excluding PPP loans, and OREO	0.44			0.51			0.48			0.50			0.48
Ratio of allowance for loan losses to:
Nonaccruing loans	780.09			635.29			922.96			1,061.68			1,027.35
Nonperforming assets	269.76			280.35			327.61			340.16			308.21
Total loans	1.12			1.34			1.45			1.55			1.49
Total loans, excluding PPP loans	1.19			1.42			1.58			1.68			1.49
Net charge-offs (recoveries) to average loans outstanding	0.02			0.02			0.04			0.01			0.06

Capital Ratios:
Shareholders’ equity to total assets	12.27			12.49			11.67			11.15			10.94
Common equity tier 1 capital	14.71			14.68			14.24			13.68			12.81
Tier 1 risk-based capital	16.09			16.08			15.63			15.06			14.13
Total risk-based capital	21.52			21.78			19.03			18.51			17.35
Tier 1 leverage capital	10.29			9.81			9.50			9.05			9.45
Period end tangible equity to period end tangible assets⁽¹⁾	9.55			9.77			8.99			8.50			8.25
Average shareholders’ equity to average total assets	12.56			11.92			11.49			10.86			11.94

⁽¹⁾	^{Refer to the “Non-GAAP Reconciliation” at the end of the financial statement tables in this Earnings Release for a reconciliation of this non-GAAP financial measure to the nearest GAAP financial measure.}

Southside Bancshares, Inc.

Consolidated Financial Highlights (Unaudited)

(Dollars in thousands)

	Three Months Ended
	2021			2020
Loan Portfolio Composition	Mar 31,			Dec 31,			Sep 30,			Jun 30,			Mar 31,
Real Estate Loans:
Construction	$	605,677		$	581,941		$	610,394		$	570,801		$	603,952
1-4 Family Residential	700,430			719,952			738,343			761,815			787,875
Commercial	1,348,551			1,295,746			1,327,233			1,406,541			1,350,818
Commercial Loans	564,745			557,122			629,170			639,162			383,984
Municipal Loans	406,377			409,028			387,286			377,428			375,934
Loans to Individuals	90,818			93,990			97,549			96,824			98,439
Total Loans	$	3,716,598		$	3,657,779		$	3,789,975		$	3,852,571		$	3,601,002

Summary of Changes in Allowances:
Allowance for Loan Losses
Balance at beginning of period	$	49,006		$	55,110		$	59,868		$	53,638		$	24,797
Impact of CECL adoption⁽¹⁾ – cumulative effect adjustment	—			—			—			—			5,072
Impact of CECL adoption – purchased loans with credit deterioration	—			—			—			—			231
Loans charged-off	(795		)	(595		)	(718		)	(546		)	(995		)
Recoveries of loans charged-off	622			402			361			436			451
Net loans (charged-off) recovered	(173		)	(193		)	(357		)	(110		)	(544		)
Provision for (reversal of) loan losses	(7,379		)	(5,911		)	(4,401		)	6,340			24,082
Balance at end of period	$	41,454		$	49,006		$	55,110		$	59,868		$	53,638

Allowance for Off-Balance-Sheet Credit Exposures
Balance at beginning of period	$	6,386		$	6,020		$	6,365		$	7,460		$	1,455
Impact of CECL adoption⁽¹⁾	—			—			—			—			4,840
Provision for (reversal of) off-balance-sheet credit exposures	(2,770		)	366			(345		)	(1,095		)	1,165
Balance at end of period	$	3,616		$	6,386		$	6,020		$	6,365		$	7,460
Total Allowance for Credit Losses	$	45,070		$	55,392		$	61,130		$	66,233		$	61,098

⁽¹⁾

^{We adopted ASU 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” on January 1, 2020. ASU 2016-13 replaced the incurred loss model with an expected loss methodology that is referred to as current expected credit losses (“CECL”). Adoption of this guidance on January 1, 2020, resulted in a cumulative-effect adjustment to reduce retained earnings by $7.8 million, net of tax.}

Southside Bancshares, Inc.

Average Balances and Average Yields and Rates (Annualized) (Unaudited)

(Dollars in thousands)

The tables that follow show average earning assets and interest bearing liabilities together with the average yield on the earning assets and the average rate of the interest bearing liabilities for the periods presented. The interest and related yields presented are on a fully taxable-equivalent basis and are therefore non-GAAP measures. See “Non-GAAP Financial Measures” and “Non-GAAP Reconciliation” for more information.

	Three Months Ended
	March 31, 2021							December 31, 2020
	Average Balance			Interest		Average Yield/Rate		Average Balance			Interest		Average Yield/Rate
ASSETS
Loans ⁽¹⁾	$	3,634,053		$	36,754	4.10	%	$	3,772,158		$	39,936	4.21	%
Loans held for sale	2,803			20		2.89	%	5,012			36		2.86	%
Securities:
Taxable investment securities ⁽²⁾	295,968			2,323		3.18	%	223,753			1,753		3.12	%
Tax-exempt investment securities ⁽²⁾	1,300,991			11,176		3.48	%	1,298,584			11,413		3.50	%
Mortgage-backed and related securities ⁽²⁾	940,815			6,088		2.62	%	1,082,302			6,693		2.46	%
Total securities	2,537,774			19,587		3.13	%	2,604,639			19,859		3.03	%
Federal Home Loan Bank stock, at cost, and equity investments	35,635			136		1.55	%	46,798			199		1.69	%
Interest earning deposits	31,169			15		0.20	%	22,938			18		0.31	%
Total earning assets	6,241,434			56,512		3.67	%	6,451,545			60,048		3.70	%
Cash and due from banks	86,634							83,228
Accrued interest and other assets	677,230							687,894
Less: Allowance for loan losses	(49,240		)					(55,567		)
Total assets	$	6,956,058						$	7,167,100
LIABILITIES AND SHAREHOLDERS’ EQUITY
Savings accounts	$	517,182		209		0.16	%	$	487,452		201		0.16	%
Certificates of deposits	736,099			1,229		0.68	%	1,011,482			2,320		0.91	%
Interest bearing demand accounts	2,342,299			1,159		0.20	%	2,186,406			1,117		0.20	%
Total interest bearing deposits	3,595,580			2,597		0.29	%	3,685,340			3,638		0.39	%
Federal Home Loan Bank borrowings	727,513			1,908		1.06	%	896,484			2,125		0.94	%
Subordinated notes, net of unamortized debt issuance costs	197,252			2,395		4.92	%	158,692			2,051		5.14	%
Trust preferred subordinated debentures, net of unamortized debt issuance costs	60,256			351		2.36	%	60,255			360		2.38	%
Other borrowings	23,522			11		0.19	%	29,661			23		0.31	%
Total interest bearing liabilities	4,604,123			7,262		0.64	%	4,830,432			8,197		0.68	%
Noninterest bearing deposits	1,389,020							1,381,120
Accrued expenses and other liabilities	89,222							101,478
Total liabilities	6,082,365							6,313,030
Shareholders’ equity	873,693							854,070
Total liabilities and shareholders’ equity	$	6,956,058						$	7,167,100
Net interest income (FTE)				$	49,250						$	51,851
Net interest margin (FTE)						3.20	%						3.20	%
Net interest spread (FTE)						3.03	%						3.02	%

⁽¹⁾	^{Interest on loans includes net fees on loans that are not material in amount.}
⁽²⁾	^{For the purpose of calculating the average yield, the average balance of securities is presented at historical cost.}

^{Note: As of March 31, 2021 and December 31, 2020, loans totaling $5.3 million and $7.7 million, respectively, were on nonaccrual status. Our policy is to reverse previously accrued but unpaid interest on nonaccrual loans; thereafter, interest income is recorded to the extent received when appropriate.}

Southside Bancshares, Inc.

Average Balances and Average Yields and Rates (Annualized) (Unaudited)

(Dollars in thousands)

	Three Months Ended
	September 30, 2020							June 30, 2020
	Average Balance			Interest		Average Yield/Rate		Average Balance			Interest		Average Yield/Rate
ASSETS
Loans ⁽¹⁾	$	3,815,989		$	38,842	4.05	%	$	3,826,383		$	39,766	4.18	%
Loans held for sale	3,934			31		3.13	%	3,213			28		3.50	%
Securities:
Taxable investment securities ⁽²⁾	145,724			1,175		3.21	%	94,247			732		3.12	%
Tax-exempt investment securities ⁽²⁾	1,295,179			11,418		3.51	%	1,320,772			11,560		3.52	%
Mortgage-backed and related securities ⁽²⁾	1,209,913			7,048		2.32	%	1,359,941			9,044		2.67	%
Total securities	2,650,816			19,641		2.95	%	2,774,960			21,336		3.09	%
Federal Home Loan Bank stock, at cost, and equity investments	60,528			249		1.64	%	67,582			360		2.14	%
Interest earning deposits	17,668			17		0.38	%	24,097			23		0.38	%
Total earning assets	6,548,935			58,780		3.57	%	6,696,235			61,513		3.69	%
Cash and due from banks	80,368							78,326
Accrued interest and other assets	699,351							660,411
Less: Allowance for loan losses	(61,212		)					(55,908		)
Total assets	$	7,267,442						$	7,379,064
LIABILITIES AND SHAREHOLDERS’ EQUITY
Savings accounts	$	461,895		192		0.17	%	$	426,420		187		0.18	%
Certificates of deposit	1,172,179			3,568		1.21	%	1,187,665			4,817		1.63	%
Interest bearing demand accounts	2,069,751			1,102		0.21	%	2,013,770			1,225		0.24	%
Total interest bearing deposits	3,703,825			4,862		0.52	%	3,627,855			6,229		0.69	%
Federal Home Loan Bank borrowings	1,037,855			2,369		0.91	%	1,197,097			2,929		0.98	%
Subordinated notes, net of unamortized debt issuance costs	98,686			1,427		5.75	%	98,641			1,412		5.76	%
Trust preferred subordinated debentures, net of unamortized debt issuance costs	60,253			378		2.50	%	60,252			491		3.28	%
Other borrowings	63,526			55		0.34	%	205,724			163		0.32	%
Total interest bearing liabilities	4,964,145			9,091		0.73	%	5,189,569			11,224		0.87	%
Noninterest bearing deposits	1,371,748							1,310,651
Accrued expenses and other liabilities	96,219							77,431
Total liabilities	6,432,112							6,577,651
Shareholders’ equity	835,330							801,413
Total liabilities and shareholders’ equity	$	7,267,442						$	7,379,064
Net interest income (FTE)				$	49,689						$	50,289
Net interest margin (FTE)						3.02	%						3.02	%
Net interest spread (FTE)						2.84	%						2.82	%

⁽¹⁾	^{Interest on loans includes net fees on loans that are not material in amount.}
⁽²⁾	^{For the purpose of calculating the average yield, the average balance of securities is presented at historical cost.}

^{Note: As of September 30, 2020 and June 30, 2020, loans totaling $6.0 million and $5.6 million, respectively, were on nonaccrual status. Our policy is to reverse previously accrued but unpaid interest on nonaccrual loans; thereafter, interest income is recorded to the extent received when appropriate.}

Southside Bancshares, Inc.

Average Balances and Average Yields and Rates (Annualized) (Unaudited)

(Dollars in thousands)

	Three Months Ended
	March 31, 2020
	Average Balance			Interest		Average Yield/Rate
ASSETS
Loans ⁽¹⁾	$	3,587,143		$	42,554	4.77	%
Loans held for sale	831			9		4.36	%
Securities:
Taxable investment securities⁽²⁾	70,293			512		2.93	%
Tax-exempt investment securities⁽²⁾	888,906			7,837		3.55	%
Mortgage-backed and related securities ⁽²⁾	1,598,374			11,534		2.90	%
Total securities	2,557,573			19,883		3.13	%
Federal Home Loan Bank stock, at cost, and equity investments	62,976			425		2.71	%
Interest earning deposits	40,236			180		1.80	%
Total earning assets	6,248,759			63,051		4.06	%
Cash and due from banks	76,739
Accrued interest and other assets	611,017
Less: Allowance for loan losses	(30,373		)
Total assets	$	6,906,142
LIABILITIES AND SHAREHOLDERS’ EQUITY
Savings accounts	$	384,863		237		0.25	%
Certificates of deposit	1,362,427			6,346		1.87	%
Interest bearing demand accounts	1,975,837			3,336		0.68	%
Total interest bearing deposits	3,723,127			9,919		1.07	%
Federal Home Loan Bank borrowings	999,070			3,974		1.60	%
Subordinated notes, net of unamortized debt issuance costs	98,597			1,411		5.76	%
Trust preferred subordinated debentures, net of unamortized debt issuance costs	60,234			600		4.01	%
Other borrowings	69,846			147		0.85	%
Total interest bearing liabilities	4,950,874			16,051		1.30	%
Noninterest bearing deposits	1,042,341
Accrued expenses and other liabilities	88,168
Total liabilities	6,081,383
Shareholders’ equity	824,759
Total liabilities and shareholders’ equity	$	6,906,142
Net interest income (FTE)				$	47,000
Net interest margin (FTE)						3.03	%
Net interest spread (FTE)						2.76	%

⁽¹⁾	^{Interest on loans includes net fees on loans that are not material in amount.}
⁽²⁾	^{For the purpose of calculating the average yield, the average balance of securities is presented at historical cost.}

^{Note: As of March 31, 2020, loans totaling $5.2 million were on nonaccrual status. Our policy is to reverse previously accrued but unpaid interest on nonaccrual loans; thereafter, interest income is recorded to the extent received when appropriate.}

Southside Bancshares, Inc.

Non-GAAP Reconciliation (Unaudited)

(Dollars and shares in thousands, except per share data)

The following tables set forth the reconciliation of return on average common equity to return on average tangible common equity, book value per share to tangible book value per share, net interest income to net interest income adjusted to a fully taxable-equivalent basis assuming a 21% marginal tax rate for interest earned on tax-exempt assets such as municipal loans and investment securities, along with the calculation of total revenue, adjusted noninterest expense, efficiency ratio (FTE), net interest margin (FTE) and net interest spread (FTE) for the applicable periods presented.

	Three Months Ended
	2021				2020
	Mar 31,				Dec 31,				Sep 30,				Jun 30,				Mar 31,
Reconciliation of return on average common equity to return on average tangible common equity:
Net income	$	34,091			$	29,572			$	27,074			$	21,554			$	3,953
After-tax amortization expense	605				652				696				735				774
Adjusted net income available to common shareholders	$	34,696			$	30,224			$	27,770			$	22,289			$	4,727

Average shareholders’ equity	$	873,693			$	854,070			$	835,330			$	801,413			$	824,759
Less: Average intangibles for the period	(210,563		)		(211,354		)		(212,221		)		(213,135		)		(214,104		)
Average tangible shareholders’ equity	$	663,130			$	642,716			$	623,109			$	588,278			$	610,655

Return on average tangible common equity	21.22			%	18.71			%	17.73			%	15.24			%	3.11			%

Reconciliation of book value per share to tangible book value per share:
Common equity at end of period	$	858,597			$	875,297			$	839,148			$	817,605			$	795,800
Less: Intangible assets at end of period	(210,094		)		(210,860		)		(211,685		)		(212,566		)		(213,497		)
Tangible common shareholders’ equity at end of period	$	648,503			$	664,437			$	627,463			$	605,039			$	582,303

Total assets at end of period	$	6,998,886			$	7,008,227			$	7,190,960			$	7,329,611			$	7,273,638
Less: Intangible assets at end of period	(210,094		)		(210,860		)		(211,685		)		(212,566		)		(213,497		)
Tangible assets at end of period	$	6,788,792			$	6,797,367			$	6,979,275			$	7,117,045			$	7,060,141

Period end tangible equity to period end tangible assets	9.55			%	9.77			%	8.99			%	8.50			%	8.25			%

Common shares outstanding end of period	32,659				32,951				33,072				33,032				33,012
Tangible book value per common share	$	19.86			$	20.16			$	18.97			$	18.32			$	17.64

Reconciliation of efficiency ratio to efficiency ratio (FTE), net interest margin to net interest margin (FTE) and net interest spread to net interest spread (FTE):
Net interest income (GAAP)	$	46,303			$	48,707			$	46,586			$	47,271			$	44,701
Tax equivalent adjustments:
Loans	736				717				688				679				668
Tax-exempt investment securities	2,211				2,427				2,415				2,339				1,631
Net interest income (FTE) ⁽¹⁾	49,250				51,851				49,689				50,289				47,000
Noninterest income	13,623				10,900				11,141				12,193				15,498
Nonrecurring income ⁽²⁾	(2,003		)		24				(78		)		(2,662		)		(5,541		)
Total revenue	$	60,870			$	62,775			$	60,752			$	59,820			$	56,957

Noninterest expense	$	31,234			$	31,315			$	31,616			$	29,856			$	30,520
Pre-tax amortization expense	(766		)		(825		)		(881		)		(931		)		(980		)
Nonrecurring expense ⁽³⁾	236				(758		)		(315		)		(39		)		29
Adjusted noninterest expense	$	30,704			$	29,732			$	30,420			$	28,886			$	29,569

Efficiency ratio	53.01			%	49.86			%	52.77			%	50.85			%	54.10			%
Efficiency ratio (FTE) ⁽¹⁾	50.44			%	47.36			%	50.07			%	48.29			%	51.91			%

Average earning assets	$	6,241,434			$	6,451,545			$	6,548,935			$	6,696,235			$	6,248,759

Net interest margin	3.01			%	3.00			%	2.83			%	2.84			%	2.88			%
Net interest margin (FTE) ⁽¹⁾	3.20			%	3.20			%	3.02			%	3.02			%	3.03			%

Net interest spread	2.84			%	2.83			%	2.65			%	2.64			%	2.61			%
Net interest spread (FTE) ⁽¹⁾	3.03			%	3.02			%	2.84			%	2.82			%	2.76			%

⁽¹⁾	^{These amounts are presented on a fully taxable-equivalent basis and are non-GAAP measures.}
⁽²⁾	^{These adjustments may include net gain or loss on sale of securities available for sale in the periods where applicable.}
⁽³⁾	^{These adjustments may include foreclosure expenses and branch closure expenses, in the periods where applicable.}

April 23, 2021 6:03 am

Park Hotels & Resorts Announces the Sale of the W New Orleans – French Quarter and Provides an Update on Hotel Reopenings and Operating Trends

TYSONS, Va., April 23, 2021 (GLOBE NEWSWIRE) — Park Hotels & Resorts Inc. (NYSE: PK) (“Park” or the “Company”) today announced that it has closed on the sale of the 97-room W New Orleans – French Quarter (the “Hotel”) located in New Orleans, LA, for gross proceeds of approximately $24.1 million, or $249,000 per key. When adjusted for Park’s anticipated capital expenditures (“capex”), the sale price represents a 4.3% capitalization rate on the Hotel’s 2019 net operating income (5.8% excluding capex), or 17.9x the Hotel’s 2019 EBITDA (13.3x excluding capex). Proceeds from the sale will be used to repay debt.

The sale of the Hotel marks the 25^th non-core hotel that Park has sold or disposed of since its spin-off from Hilton in January 2017, with gross proceeds from these 25 hotels totaling over $1.2 billion. Since the Company’s acquisition of Chesapeake Lodging Trust in September 2019, it has now sold six non-core hotels as part of its ongoing strategy to de-lever its balance sheet and transform its portfolio.

Operational Update

Park also announced that the Company recently reopened three West Coast hotels due to improving demand trends in their respective markets. The 360-room Le Meridien San Francisco and the 171-room Hotel Adagio, Autograph Collection, both located in San Francisco, as well as the 850-room DoubleTree Hotel Seattle Airport, all reopened in late March. Park now has 52 out of 59 hotels open, accounting for nearly 80% of the Company’s total room count. The Company’s seven remaining suspended hotels are currently expected to reopen over the next couple of quarters as travel restrictions ease and demand recovers.

The Company continues to witness encouraging improvements in demand, with occupancy at its consolidated hotels increasing from 21% in January to nearly 33% in March, while the portfolio achieved positive EBITDA in March with nearly half of all open consolidated hotels generating positive EBITDA. Park’s hotels located in leisure-oriented destinations or submarkets have recorded strong increases in leisure demand over the latter half of the first quarter and into the second quarter. As a result of the recent strong performance, Park’s monthly burn rate decreased to $26 million in March from the average monthly burn rate of $42 million the company reported during the fourth quarter 2020.

“I am pleased to announce our first non-core asset sale since the onset of the COVID-19 pandemic at very strong pricing amidst encouraging buyer demand for premium, well-located hotels in markets with high barriers to entry,” stated Thomas J. Baltimore, Jr., Chairman and CEO of Park. “The sale of the W New Orleans – French Quarter helps to streamline our portfolio to focus our resources on our larger assets as well as reduce our exposure in a market where we already have a strong presence with our 1,622-room Hilton Riverside hotel. We remain laser-focused on executing on our strategic priorities, including reopening our hotels, reducing our burn rate and further de-levering our balance sheet, as we enter a promising period of demand recovery over the coming months. Operationally, leisure demand trends continue to improve at a faster pace than we had initially anticipated, with a broader based recovery across all demand segments expected over the back half of 2021 and well into 2022.”

About Park Hotels & Resorts

Park is the second largest publicly traded lodging REIT with a diverse portfolio of market-leading hotels and resorts with significant underlying real estate value. Park’s portfolio currently consists of 59 premium-branded hotels and resorts with over 33,000 rooms primarily located in prime city center and resort locations. Visit www.pkhotelsandresorts.com for more information.

For more information, contact:

Ian Weissman
Senior Vice President, Corporate Strategy
571-302-5591
[email protected]

For additional information or to receive press releases via e-mail, please visit our website at

www.pkhotelsandresorts.com

April 23, 2021 6:03 am

Gran Tierra Energy Inc. Provides Release Date for its 2021 First Quarter Results and Details of Virtual Annual Meeting of Stockholders

CALGARY, Alberta, April 23, 2021 (GLOBE NEWSWIRE) — Gran Tierra Energy Inc. (“Gran Tierra” or the “Company”) (NYSE American:GTE) (TSX:GTE) (LSE:GTE) announces that the Company will release its 2021 first quarter financial and operating results on Tuesday May 4, 2021, post-market, and provides the following information regarding the Company’s Annual Meeting of Stockholders.

Gran Tierra’s 2021 Annual Meeting of Stockholders will be held virtually on Wednesday, May 5, 2021 at 1:30 p.m. (Mountain Time). In light of the COVID-19 pandemic and to mitigate the risks to the health and safety of our community, stockholders and employees, Gran Tierra will be holding its annual meeting in a virtual-only format by way of webcast and no physical or in-person meeting will be held.

How to Participate in the Virtual Annual Meeting

To access the virtual meeting, please go to www.meetingcenter.io/296994452. We recommend that you log in 15 minutes before the Annual Meeting starts. To log into the Annual Meeting you will have the option to join as a “Guest” or join as a “Shareholder”. If you join as a “Shareholder,” you will be able to vote your shares and ask questions during the Annual Meeting. In order to join as a “Shareholder,” you are required to have the password and your control number. The password for the meeting is GTRE2021 and the control number can be found on the form of proxy or notice. Guests and non-registered (beneficial) shareholders who have not duly appointed themselves as proxyholder will be able to attend the Annual Meeting at the link above by providing the guest login information but will not be able to vote or ask questions at the meeting.

Full details on how to vote, change or revoke a vote, appoint a proxyholder, attend the virtual Annual Meeting, ask questions and other general proxy matters are available in the proxy statement dated March 25, 2021 available on the Company’s website or the sec.gov website.

Whether or not you plan to attend the Annual Meeting, we urge you to vote and submit your proxy in advance of the Annual Meeting by one of the methods described in the proxy materials for the Annual Meeting.

About Gran Tierra Energy Inc.

Gran Tierra Energy Inc. is an international oil and gas exploration and production company, headquartered in Calgary, Canada, incorporated in the United States, trading on the NYSE American (GTE), the Toronto Stock Exchange (GTE) and the London Stock Exchange (GTE), and operating in South America. Gran Tierra has interests in producing and prospective properties in Colombia and prospective properties in Ecuador. The Company’s strategy is focused on establishing a portfolio of producing properties, plus production enhancement and exploration opportunities, to provide a base for future growth.

Gran Tierra’s Securities and Exchange Commission filings are available on the Securities and Exchange Commission website at http://www.sec.gov, and Gran Tierra’s reports filed with the Canadian Securities Administrators are available on SEDAR at http://www.sedar.com.

Contact Information

For investor and media inquiries please contact:

Gary Guidry
President & Chief Executive Officer

Ryan Ellson
Executive Vice President & Chief Financial Officer

Rodger Trimble
Vice President, Investor Relations

+1-403-265-3221

[email protected]

April 23, 2021 6:03 am

Sprague Resources LP Announces Cash Distribution for the First Quarter of 2021 and Earnings Conference Call Schedule

Sprague announces a cash distribution of $0.6675 per unit

PORTSMOUTH, N.H., April 23, 2021 (GLOBE NEWSWIRE) — Sprague Resources LP (“Sprague”) (NYSE: SRLP) announced today that the Board of Directors of its general partner, Sprague Resources GP LLC (the “General Partner”), declared a cash distribution of $0.6675 per unit ($2.67 per unit on an annualized basis) for the quarter ended March 31, 2021 and is equal to all distributions in 2020.

The announced distribution will be paid on Monday, May 10, 2021, to unitholders of record as of the close of business on May 4, 2021.

Unaudited First Quarter 2021 Financial Results and Earnings Conference Call

Sprague will release its first quarter 2021 unaudited financial results before the opening of trading on the NYSE on Thursday, May 6, 2021 and will host a conference call that day at 1:00 p.m. Eastern time to discuss its financial results. Those interested in hearing the discussion can access the call by dialing (866) 516-2130, and using participation code 8146978. International callers may join by dialing (678) 509-7612. Participants can dial in up to 30 minutes prior to the start of the call. The conference call may also be accessed live by webcast link: https://edge.media-server.com/mmc/p/ab6xfiyo

This link is also available on the “Investor Relations-Calendar of Events” page of Sprague’s website at www.spragueenergy.com and will be archived on our website for one year. Certain non-GAAP financial information included in the earnings call will be available at the time of the call on the “Investor Relations – Featured Documents” section of Sprague’s website https://investors.spragueenergy.com.

*****

Qualified Notice

This release is intended to be a qualified notice under Treasury Regulation Section 1.1446-4(b). Brokers and nominees should treat one hundred percent (100.0%) of Sprague’s distributions to non-U.S. investors as being attributable to income that is effectively connected with a United States trade or business. Accordingly, Sprague’s distributions to non-U.S. investors are subject to federal income tax withholding at the highest applicable effective tax rate.

*****

About Sprague Resources LP

Sprague Resources LP is engaged in the purchase, storage, distribution and sale of refined petroleum products and natural gas. The company also provides storage and handling services for a broad range of materials. More information concerning Sprague can be found at www.spragueenergy.com.

Investor Contact:
Paul Scoff
+1 800.225.1560
[email protected]

April 23, 2021 6:03 am

Johnson Outdoors to Release Fiscal 2021 Second Quarter Results on May 7, 2021

RACINE, Wis., April 23, 2021 (GLOBE NEWSWIRE) — JOHNSON OUTDOORS INC. (Nasdaq: JOUT), a leading global innovator of outdoor recreation equipment and technology, will release financial results for the Fiscal 2021 second quarter on Friday, May 7, 2021, before market open that day. The Company will host a conference call and audio webcast shortly afterwards at 11:00 a.m. Eastern Time to discuss the financial results and provide a Company update.

A live listen-only webcast of the conference call may be accessed at Johnson Outdoors’ home page. A replay will be available on the Investor section home page on the Johnson Outdoors’ website – www.johnsonoutdoors.com – for 30 days.

ABOUT JOHNSON OUTDOORS INC.

JOHNSON OUTDOORS is a leading global outdoor recreation company that inspires more people to experience the awe of the great outdoors with innovative, top-quality products. The company designs, manufactures and markets a portfolio of winning, consumer-preferred brands across four categories: Watercraft Recreation, Fishing, Diving and Camping. Johnson Outdoors’ iconic brands include: Old Town^® canoes and kayaks; Ocean Kayak™; Carlisle® paddles; Minn Kota^® fishing motors, batteries and anchors; Cannon^® downriggers; Humminbird^® marine electronics and charts; SCUBAPRO^® dive equipment; Jetboil^® outdoor cooking systems; and, Eureka!^®camping and hiking equipment.

Visit Johnson Outdoors at http://www.johnsonoutdoors.com

CONTACT:	PATRICIA PENMAN
	262-631-6600

April 22, 2021 6:05 pm

OP Bancorp Declares Quarterly Cash Dividend of $0.07 per Share

OP Bancorp Declares Quarterly Cash Dividend of $0.07 per Share

LOS ANGELES–(BUSINESS WIRE)–
OP Bancorp (the “Company”) (NASDAQ: OPBK), the holding company of Open Bank (the “Bank”), announced today that its Board of Directors declared a quarterly cash dividend of $0.07 per share of its common stock. The dividend is payable on or about May 20, 2021 to all shareholders of record as of the close of business on May 6, 2021.

About OP Bancorp

OP Bancorp, the holding company for Open Bank (the “Bank”), is a California corporation whose common stock is quoted on the Nasdaq Global Market under the ticker symbol, “OPBK.” The Bank is engaged in the general commercial banking business in Los Angeles, Orange, and Santa Clara Counties, California and Carrollton, Texas and is focused on serving the banking needs of small- and medium-sized businesses, professionals, and residents with a particular emphasis on Korean and other ethnic minority communities. The Bank currently operates with nine full branch offices in Downtown Los Angeles, Los Angeles Fashion District, Los Angeles Koreatown, Gardena, Buena Park, and Santa Clara, California, and Carrollton, Texas. The Bank also has four loan production offices in Atlanta, Georgia, Aurora, Colorado, and Lynnwood and Seattle, Washington. The Bank commenced its operations on June 10, 2005 as First Standard Bank and changed its name to Open Bank in October 2010. Its headquarters is located at 1000 Wilshire Blvd., Suite 500, Los Angeles, California 90017. Phone 213.892.9999; www.myopenbank.comMember FDIC, Equal Housing Lender.

View source version on businesswire.com: https://www.businesswire.com/news/home/20210422005141/en/

Investor Relations

OP Bancorp

Christine Oh

EVP & CFO

213.892.1192

[email protected]

KEYWORDS: California United States North America

INDUSTRY KEYWORDS: Banking Professional Services Finance

MEDIA:

April 22, 2021 6:04 pm

Mid Penn Bancorp, Inc. Reports Record First Quarter 2021 Earnings and Declares Dividend

MILLERSBURG, Pa., April 22, 2021 (GLOBE NEWSWIRE) — Mid Penn Bancorp, Inc. (“Mid Penn”) (NASDAQ: MPB), the parent company of Mid Penn Bank (the “Bank”) and MPB Financial Services, LLC, today reported net income to common shareholders (earnings) for the quarter ended March 31, 2021 of $9,312,000 or $1.11 per common share basic and $1.10 per share diluted, compared to earnings of $3,818,000 or $0.45 per common share basic and diluted for the quarter ended March 31, 2020. The diluted earnings per share for the quarter ended March 31, 2021 reflect an increase of 144 percent compared to the earnings per share for the same period in the prior year, and represents a record high level of quarterly earnings for Mid Penn. Mid Penn also reported total assets of $3,382,038,000 as of March 31, 2021, reflecting an increase of $383,090,000 or 13 percent compared to total assets of $2,998,948,000 as of December 31, 2020.

Tangible book value per common share, a non-GAAP measure that is regularly reported in the banking industry and the most directly comparable non-GAAP measure to book value per share, favorably increased to $23.42 as of March 31, 2021, compared to $22.39 as of December 31, 2020 and $20.18 as of March 31, 2020. The GAAP measure of book value per share also favorably increased to $31.37 as of March 31, 2021, compared to $30.37 at December 31, 2020 and $28.23 as of March 31, 2020. Please refer to the section included herein under the heading “Reconciliation of Non-GAAP Measures (Unaudited)” for a discussion of our use of non-GAAP adjusted financial information, which includes tables reconciling GAAP and non-GAAP adjusted financial measures for these and certain other periods ended from March 31, 2020 to March 31, 2021.

Included in total assets as of March 31, 2021 are $590,035,000 of Paycheck Protection Program (“PPP”) loans, net of deferred fees, with this total being comprised of (i) $335,589,000 of PPP 2021 loans, net of deferred fees, originated during the first quarter of 2021; and (ii) $254,446,000 of PPP 2020 loans, net of deferred fees, originated during 2020 which, as of March 31, 2021, were still outstanding as the Small Business Administration (“SBA”) had not yet completed the loan forgiveness and repayment processing. Comparatively, as of December 31, 2020, Mid Penn had $388,313,000 of PPP 2020 loans outstanding, net of deferred fees. Mid Penn has been a significant participating lender under the PPP, which was originally created when the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act was signed into law on March 27, 2020, and extended by the signing of the Consolidated Appropriations Act, 2021 into law on December 27, 2020.

Total core banking loans (total loans excluding both the PPP loans outstanding, and residential mortgage loans held for sale) increased by $60,473,000 since year-end 2020 and totaled $2,056,201,000 as of March 31, 2021, representing an annualized growth rate of over 12 percent. Deposit growth since year-end 2020 through March 31, 2021 totaled $192,247,000 representing an annual deposit growth rate of over 31 percent, including an increase of $140,493,000 in noninterest-bearing deposits including proceeds deposited from PPP loan funding. Also, during the first quarter of 2021, the Bank obtained $182,136,000 of additional funding from the Federal Reserve through the Paycheck Protection Program Liquidity Facility (“PPPLF”), with such funding used to support the PPP 2021 loan production. Under the PPPLF, the Federal Reserve supplies financing to the Bank at a rate of 35 basis points (0.35%) for a term and amount determined based on the principal amount of PPP loans fully and specifically pledged as collateral in support of the PPPLF borrowings. Draws of PPPLF funds must be repaid to the Federal Reserve immediately after the specific PPP loans collateralizing the related draws are repaid to the Bank.

PRESIDENT’S STATEMENT

As a follow up to a year of record earnings and strong organic growth in almost every aspect of our delivery, it is with great pride that we announce these stellar first quarter results to our shareholders.

Our success in the first quarter included 12 percent annualized organic loan growth (excluding PPP loans), 31 percent annualized organic deposit growth, 43 percent net interest income growth, a stable net interest margin, a broad-based 61 percent increase in non-interest income, relatively controlled operating expenses leading to over 30 percent positive operating leverage, and a decrease in non-performing assets of over 50 percent. On top of all that, through the date of this press release, we also originated another $370 million in round 2 PPP loans, putting our grand total of PPP loan originations in the last twelve months at $1 billion.

The combination of those efforts led us to our best quarter of earnings since the formation of the holding company, which is the second consecutive quarter for that milestone. The earnings are also up 144 percent over the first quarter of 2020, demonstrating just how far this company has come in the last twelve months as we adjusted quickly to the pandemic, the economic crisis, and the new business environment. While we are enthusiastic about these results, we recognize that we are setting a high bar of expectations for future performance, which we are optimistic to reach.

The success of the last twelve months has added significantly to both our book value per share (up 11 percent) and our tangible book value per share (up 16 percent) even while paying a healthy level of dividends. We believe our shareholders deserve a top tier return on their investment and we feel that has been accomplished in this last year.

It is with all of the above in mind that the Board of Directors proudly announces the declaration of a first quarter dividend of $0.20 per common share payable on May 24, 2021 to shareholders of record as of May 10, 2021.

OPERATING RESULTS

Net Interest Income and Net Interest Margin

For the three months ended March 31, 2021, net interest income was $25,325,000, an increase of $7,660,000 or 43 percent compared to net interest income of $17,665,000 for the quarter ended March 31, 2020. The year-over-year increase included the recognition of $5,037,000 of PPP loan processing fees generated as a result of Mid Penn’s participation in the PPP program (similar fees were not recognized during the first quarter of 2020 as PPP loan funding began during the second quarter of 2020). These PPP fees are recognized into interest income over the term of the respective loan, or sooner if the loans are forgiven by the SBA, or the borrowers otherwise pay down principal prior to a loan’s stated maturity. Also contributing to the net interest income increase were the interest and fees from core loan growth since March 31, 2020, and the reduced interest expense due to the lower cost of deposits in the first quarter of 2021 compared to the same period in 2020.

Mid Penn’s tax-equivalent net interest margin for the three months ended March 31, 2021 was 3.46 percent and comparable to the 3.45 percent net interest margin for the three months ended March 31, 2020. The yield on interest-earning assets decreased from 4.61 percent for the first quarter of 2020 to 3.98 percent for the first quarter of 2021. Though the quarterly average balance of interest-earning assets increased year over year, the yields on interest-earning assets declined due to both the reduction in rates, as well as the significant average balance of PPP loans outstanding in the first quarter of 2021, which earn interest at a rate of 1 percent while outstanding. The decrease in the yield on interest-earning assets was substantially offset by a favorable decrease in the cost of funds, as the total cost of deposits for the three months ended March 31, 2021 favorably decreased to 0.61 percent compared to 1.34 percent for the three months ended March 31, 2020. The reduction in the cost of funds reflects both the aforementioned growth in noninterest-bearing deposits, and deposit rate decreases, many of which resulted in response to market rate cuts from the COVID-19 pandemic.

Noninterest Income

For the three months ended March 31, 2021, noninterest income totaled $4,712,000, an increase of $1,778,000 or 61 percent, compared to noninterest income of $2,934,000 for the three months ended March 31, 2020.

Mortgage banking income was $2,379,000 for the three months ended March 31, 2021, an increase of $1,197,000 or more than double the mortgage banking income of $1,182,000 recorded during the three months ended March 31, 2020. Mid Penn significantly increased residential mortgage originations (both purchase and refinance activity) and secondary-market loan sales and gains when comparing the first quarter of 2021 to the same period last year as mortgage interest rates declined and remained low in the twelve months since March 31, 2020, resulting in significantly increased mortgage loan production for both home purchasing and refinancing activity.

Income from fiduciary and wealth management activities was $556,000 for the three months ended March 31, 2021, an increase of $172,000 or 45 percent, compared to fiduciary income of $384,000 for the same period in 2020. These additional revenues were attributed to growth in trust assets under management and increased sales of retail investment products.

ATM debit card interchange income was $568,000 for the three months ended March 31, 2021, an increase of $152,000 or 37 percent compared to interchange income of $416,000 for the three months ended March 31, 2020. The increase resulted from increasing card-based transaction usage across our expanding checking account customer base.

Mid Penn recorded no net gains on sales of investment securities during the three months ended March 31, 2021, compared to net gains on sales of securities of $132,000 for the three months ended March 31, 2020. Sale volume and gains vary from quarter to quarter based upon market conditions, as well as related yield curve and valuation changes, and asset/liability and interest rate risk management activities.

Service charges on deposits were $152,000 during the three months ended March 31, 2021, reflecting a decrease of $53,000 or 26 percent when compared to the same period in 2020. The decrease is primarily due to less overdraft activity and less overdraft fees being charged to deposit customers.

Other income was $791,000 for the three months ended March 31, 2021, an increase of $419,000 compared to other income of $372,000 for the three months ended March 31, 2020. The increase in other income was primarily driven by higher volumes of fee-based income, including fees from execution of new loan-level swap, wire transfer fees, letter of credit fees, and credit card program referrals and royalties.

Noninterest Expense

For the three months ended March 31, 2021, noninterest expense totaled $17,558,000, an increase of $1,977,000 or 13 percent, compared to noninterest expense of $15,581,000 for the three months ended March 31, 2020.

Salaries and employee benefits were $9,598,000 for the three months ended March 31, 2021, an increase of $1,317,000 or 16 percent, versus the same period in 2020, with the increase primarily attributable to increased mortgage commissions expense commensurate with the significant increases in loan originations and secondary market sales success of the mortgage banking group.

Software licensing and utilization costs were $1,445,000 for the three months ended March 31, 2021, an increase of $224,000 or 18 percent compared to $1,221,000 for the three months ended March 31, 2020. This increase reflects the additional costs from both transaction volume-based charges, and licensing fees related to the addition of new staff added since March 31, 2020, as well as costs associated with ensuring secure connectivity for an increased volume of employees working remotely in response to the COVID-19 restrictions. Additionally, Mid Penn continued to invest in upgrades to internal systems, networks, storage capabilities, cybersecurity management, and data security mechanisms to enhance data management and security capabilities responsive to both the larger company profile and the increasing complexity of information technology management.

FDIC assessment expense was $470,000 for the three months ended March 31, 2021, an increase of $158,000 or 51 percent compared to $312,000 for the three months ended March 31, 2020. The increased FDIC assessment aligns with the growth of the average assets of the Bank on which the assessment is based, when comparing the first quarter of 2021 to the same period in 2020.

Community and charitable contributions qualifying for State tax credits totaled $270,000 for the three months ended March 31, 2021, compared to similar program contributions of $35,000 for the three months ended March 31, 2020. This variance reflects the timing of certain tax-credit-qualifying donations made to participants within Pennsylvania’s Department of Community and Economic Development (“DCED”) Educational Improvement Tax Credit Program (“EITC”), and to moderate-to-low income housing projects in the DCED’s Neighborhood Assistance Program (“NAP”) which have been approved by the Commonwealth of Pennsylvania. These EITC and NAP contributions generated tax credits totaling $206,000 and $33,000 during the periods ended March 31, 2021 and 2020, respectively, to be applied to Mid Penn’s Pennsylvania bank shares tax liability. These contributions and programs are also key elements of Mid Penn’s Community Reinvestment Act compliance activities.

Pennsylvania bank shares tax expense was $300,000 for the three months ended March 31, 2021, a decrease of $105,000 or 26 percent compared to $405,000 for the three months ended March 31, 2020. The decrease in shares tax expense generally reflects the aforementioned larger dollar volume of EITC and NAP donations made in the first quarter of 2021 which qualified for PA shares tax credits.

Mortgage banking profit-sharing expense totaled $120,000 and related to payments to third-party principals commensurate with the success within the Southeastern Pennsylvania mortgage banking group at Mid Penn for the three months ended March 31, 2021. Similar expenses were not recognized during the same period of 2020 as the group did not generate sufficient earnings to qualify for profit-sharing during the three months ended March 31, 2020.

Marketing and advertising expense was $135,000 for the three months ended March 31, 2021, a decrease of $69,000 or 34 percent compared to $204,000 during the same period in 2020. As a result of the ongoing pandemic, in-person customer events and related marketing promotions were significantly reduced during the first quarter of 2021 when compared to the same period last year.

The provision for income taxes was $2,167,000 during the three months ended March 31, 2021, an increase of $1,517,000 or more than twice the income tax provision recorded for the same period in 2020. The first quarter 2021 provision for income taxes reflects a Federal effective tax rate 18.1 percent compared to a Federal effective tax rate of 14.5 percent for the three months ended March 31, 2020. The increase in the effective tax rate reflects both (i) higher pre-tax income when compared to the first three months of 2020, and (ii) less tax-exempt interest recognized due to less tax-exempt securities being held in the investment security portfolio when compared to the prior year. In addition to federal taxes, for the three months ended March 31, 2021 and 2020, the income tax provision includes $92,000 and $30,000, respectively, of state income taxes that Mid Penn pays to the states of New Jersey, Maryland, and Delaware for revenues sourced in those respective states.

FINANCIAL CONDITION

Loans

Total loans at March 31, 2021 were $2,646,236,000 compared to $2,384,041,000 at December 31, 2020, an increase of $262,195,000 or 11 percent since year-end 2020. The loan growth since December 31, 2020 reflects an increase of $60,473,000 in non-PPP core banking loans, primarily in commercial real estate credits, and commercial and industrial financing loans. Additionally, much of the growth is attributable to a net increase in the balance of PPP loans outstanding, net of deferred fees, of $201,722,000 since December 31, 2020 comprised of 2021 PPP originations less 2020 PPP loan paydowns.

Investments

Mid Penn’s portfolio of held-to-maturity securities, recorded at amortized cost, increased $2,268,000 to $130,560,000 as of March 31, 2021, as compared to $128,292,000 as of December 31, 2020. The level of the held-to-maturity portfolio generally is managed to provide income and liquidity from prepayments of U.S. government agency holdings in the portfolio, and to meet the Bank’s public funds deposit pledging requirements. Mid Penn’s total available-for-sale securities portfolio decreased $2,498,000 or 43 percent, from $5,748,000 at December 31, 2020 to $3,250,000 at March 31, 2021 primarily due to the call of one corporate debt security during the first quarter.

Deposits

Total deposits increased $192,247,000 or 8 percent, from $2,474,580,000 at December 31, 2020, to $2,666,827,000 at March 31, 2021. Deposit growth was led by substantial increases in noninterest-bearing balances and money market deposits, primarily due to both expanded cash management and commercial deposit account relationships, and new deposits established as a result of Mid Penn’s PPP loan funding activities.

Short-Term Borrowings

Short-term borrowings increased to $307,753,000 as of March 31, 2021 as compared to $125,617,000 as of December 31, 2020, and for both dates, consisted entirely of Mid Penn’s utilization of the Federal Reserve’s PPPLF. The PPPLF allows banks to pledge PPP loans as collateral to borrow funds for up to a term of five years (to match the term of the respective PPP loans) at an interest rate of 0.35 percent.

Capital

Shareholders’ equity increased by $8,348,000 or 3 percent from $255,688,000 as of December 31, 2020 to $264,036,000 as of March 31, 2021. The increase in shareholders’ equity primarily reflects the growth in retained earnings through year-to-date net income, less dividends declared and paid during the first quarter of 2021. Regulatory capital ratios for both Mid Penn and its banking subsidiary exceeded regulatory “well-capitalized” levels at both March 31, 2021 and December 31, 2020.

ASSET QUALITY and COVID-19 IMPACT

Excluding PPP loans, which are guaranteed by the SBA and have no associated allowance, the allowance for loan and lease losses as a percentage of core loans was 0.66 percent as of March 31, 2021 and 0.67 percent as of December 31, 2020. The allowance for loan and lease losses as a percentage of total loans including PPP loans was 0.51 percent at March 31, 2021, compared to 0.56 percent at both December 31, and March 31, 2020. No PPP loans were outstanding as of March 31, 2020. Mid Penn had net loan charge-offs of $791,000 and $51,000 for the three months ended March 31, 2021 and 2020, respectively, with the increase in the first quarter of 2021 related to the workout of two larger nonperforming loans late in the quarter.

The provision for loan losses was $1,000,000 for the three months ended March 31, 2021, an increase of 82 percent compared to the provision for loan losses of $550,000 for the three months ended March 31, 2020. The allowance for loan losses and the related provision reflect Mid Penn’s continued application of the incurred loss method for estimating credit losses as Mid Penn is not yet required to adopt the current expected credit loss (“CECL”) accounting standard. The increase in the loan loss reserves and the provision was primarily the result of (i) providing for core loan growth during the three months ended March 31, 2021, and (ii) an increase in qualitative factors related to economic and external conditions when compared to prior periods, with such changes driven by the possibility for ongoing financial implications from the COVID-19 pandemic on Mid Penn’s customers and market area. The charge-offs in the first quarter of 2021 were substantially covered by the combination of (i) previously established specific allocations on the nonperforming credits, (ii) certain offsetting recoveries of previously charged-off loans during the quarter, and (iii) utilization of some of the unallocated reserves.

Total nonperforming assets were $6,831,000 at March 31, 2021, a substantial decrease compared to nonperforming assets of $15,644,000 at December 31, 2020 and $7,517,000 at March 31, 2020. The decrease in nonperforming assets was primarily the result of the successful workout of two nonaccrual commercial relationships totaling $9,123,000:

Management determined that an acquired commercial loan relationship with three loans totaling $7,354,000 (reclassified to nonaccrual status in 2019) would likely involve a long-term workout period and substantial legal and other collection costs in order for the Bank to execute its rights on the commercial real estate collateral. As part of its collection efforts, management identified a third party willing to purchase the Bank’s loans and rights for a $604,000 discount from the recorded balance. Management opted for this solution to both expedite the workout of the relationship, and eliminate the high and extended legal and collection costs associated with the long-term workout.
Additionally, during the first quarter of 2021, as part of the workout plan related to one commercial loan relationship consisting of five loans totaling $1,769,000 (reclassified to nonaccrual status in 2020), management capitalized on a strong offer from a qualified buyer on property collateralizing the loans, thereby avoiding a likely costly, long-term bankruptcy and foreclosed real estate situation. The proceeds of the sale of the collateral were applied to the existing loans and management agreed to a partial charge-off of $255,000 provided the borrower could pay the remaining deficiency. As a result, one loan within this relationship totaling $143,000 was refinanced and remains on nonaccrual status as of March 31, 2021.

Given these large workouts, nonperforming assets were 0.26 percent of the total of loans plus other real estate assets as of March 31, 2021, a significant and favorable reduction compared to 0.66 percent at December 31, 2020 and 0.72 percent as of March 31, 2020. Loan loss reserves as a percentage of nonperforming loans increased to 204 percent at March 31, 2021, compared to 84 percent at December 31, 2020 and 90 percent at March 31, 2020. Total foreclosed real estate assets increased slightly from $134,000 at December 31, 2020 to $154,000 at March 31, 2021.

As of March 31, 2021, the principal balance of loans remaining in a CARES Act qualifying deferment status totaled $5,131,000, or less than 1 percent of the total loan portfolio, a reduction compared to December 31, 2020, when $11,681,000 of loans, representing 1 percent of the total loan portfolio, were in this deferment status. Most borrowers granted a CARES Act deferral have returned to regular payment status. The CARES Act, along with a subsequent joint statement issued by banking agencies, provided that short-term modifications, made in response to the impact of COVID-19 to current and performing borrowers, did not need to be accounted for as troubled debt restructurings. Depending upon the specific needs and circumstances affecting each borrower, the majority of these modifications ranged from deferrals of both principal and interest payments to some borrowers reverting to interest-only payments. The majority of the deferrals were granted for a period of three months, but some as long as six months, depending upon management’s specific evaluation of each borrower’s circumstances. Interest continued to accrue on loans modified under the CARES Act during the deferral period. During 2020, Mid Penn had provided loan modifications meeting the CARES Act qualifications to over 1,000 borrowers. Mid Penn remains in communication with each of the borrowers still in deferral status to assess the ongoing credit standing of the borrowers, and may make further adjustments to a borrower’s relationship at some future time if warranted for the specific situation.

Asset quality measures did not reflect any new impaired assets or specific reserve allocations related to the financial impact of the COVID-19 pandemic, though Bank management is continuously and closely monitoring and evaluating the impact of the COVID-19 situation on the portfolio. Management believes, based on information currently available, that the allowance for loan and lease losses of $13,591,000 is adequate as of March 31, 2021, to cover probable and estimated loan losses in the portfolio.

FINANCIAL HIGHLIGHTS (Unaudited):

(Dollars in thousands, except	Mar. 31,			Dec. 31,			Sept. 30,			June 30,			Mar. 31,
per share data)	2021			2020			2020			2020			2020

Cash and cash equivalents	$	427,371		$	303,724		$	195,357		$	143,755		$	140,758
Investment securities		134,318			134,555			150,333			158,879			195,383
Loans		2,646,236			2,384,041			2,521,827			2,445,765			1,798,149
Allowance for loan and lease losses		(13,591	)		(13,382	)		(12,170	)		(11,067	)		(10,014	)
Net loans		2,632,645			2,370,659			2,509,657			2,434,698			1,788,135
Goodwill and other intangibles		66,919			67,200			67,631			67,948			68,275
Other assets		120,785			122,810			129,957			117,085			107,200
Total assets	$	3,382,038		$	2,998,948		$	3,052,935		$	2,922,365		$	2,299,751

Noninterest-bearing deposits	$	676,717		$	536,224		$	534,918		$	564,834		$	347,532
Interest-bearing deposits		1,990,110			1,938,356			1,921,480			1,761,479			1,625,749
Total deposits		2,666,827			2,474,580			2,456,398			2,326,313			1,973,281
Borrowings and subordinated debt		427,369			245,312			321,013			331,228			65,423
Other liabilities		23,806			23,368			27,335			21,479			21,536
Shareholders’ equity		264,036			255,688			248,189			243,345			239,511
Total liabilities and shareholders’ equity	$	3,382,038		$	2,998,948		$	3,052,935		$	2,922,365		$	2,299,751

Book Value per Common Share	$	31.37		$	30.37		$	29.49		$	28.94		$	28.23
Tangible Book Value per Common Share *	$	23.42		$	22.39		$	21.46		$	20.86		$	20.18

* Non-GAAP measure; see Reconciliation of Non-GAAP Measures

OPERATING HIGHLIGHTS (Unaudited):

	Three Months Ended
(Dollars in thousands, except	Mar. 31,			Dec. 31,			Sept. 30,			June 30,			Mar. 31,
per share data)	2021			2020			2020			2020			2020

Interest income	$	29,168		$	31,926		$	26,122		$	26,188		$	23,699
Interest expense		3,843			4,137			4,714			4,842			6,034
Net Interest Income		25,325			27,789			21,408			21,346			17,665
Provision for loan and lease losses		1,000			1,500			1,100			1,050			550
Noninterest income		4,712			6,050			5,302			3,622			2,934
Noninterest expense		17,558			21,419			18,174			15,403			15,581
Income before provision for income taxes		11,479			10,920			7,436			8,515			4,468
Provision for income taxes		2,167			1,909			889			1,682			650
Net income	$	9,312		$	9,011		$	6,547		$	6,833		$	3,818

Basic Earnings per Common Share	$	1.11		$	1.07		$	0.78		$	0.81		$	0.45
Diluted Earnings per Common Share	$	1.10		$	1.06		$	0.78		$	0.81		$	0.45
Return on Average Equity		14.58	%		14.34	%		10.64	%		11.41	%		6.43	%

	Mar. 31,	Dec. 31,	Sept. 30,	June 30,	Mar. 31,
	2021	2020	2020	2020	2020
Tier 1 Capital (to Average Assets)	6.7%	6.8%	6.6%	6.6%	7.8%
Common Tier 1 Capital (to Risk Weighted Assets)	9.7%	9.6%	9.5%	9.5%	9.6%
Tier 1 Capital (to Risk Weighted Assets)	9.7%	9.6%	9.5%	9.5%	9.6%
Total Capital (to Risk Weighted Assets)	12.5%	12.6%	12.3%	12.4%	12.5%

RECONCILIATION OF NON-GAAP MEASURES (Unaudited):

This press release contains financial information determined by methods other than in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”). For tangible book value, the most directly comparable financial measure calculated in accordance with GAAP is book value. We believe that this measure is important to many investors in the marketplace who are interested in changes from period to period in book value per common share exclusive of changes in intangible assets. Goodwill and other intangible assets have the effect of increasing total book value while not increasing tangible book value. Income tax effects of non-GAAP adjustments are calculated using the applicable statutory tax rate for the jurisdictions in which the charges (benefits) are incurred, while taking into consideration any valuation allowances or non-deductible portions of the non-GAAP adjustments. This non-GAAP disclosure has limitations as an analytical tool, should not be viewed as a substitute for financial measures determined in accordance with GAAP, and should not be considered in isolation or as a substitute for analysis of Mid Penn’s results and financial condition as reported under GAAP, nor is it necessarily comparable to non-GAAP performance measures that may be presented by other companies. Management believes that this non-GAAP supplemental information will be helpful in understanding Mid Penn’s ongoing operating results. This supplemental presentation should not be construed as an inference that Mid Penn’s future results will be unaffected by similar adjustments to be determined in accordance with GAAP.

Tangible Book Value Per Share

(Dollars in thousands, except	Mar. 31,		Dec. 31,		Sept. 30,		June 30,		Mar. 31,
per share data)	2021		2020		2020		2020		2020

Shareholders’ Equity	$	264,036	$	255,688	$	248,189	$	243,345	$	239,511
Less: Goodwill		62,840		62,840		62,840		62,840		62,840
Less: Core Deposit and Other Intangibles		4,079		4,360		4,791		5,108		5,435
Tangible Equity	$	197,117	$	188,488	$	180,558	$	175,397	$	171,236

Common Shares Outstanding		8,416,095		8,419,183		8,415,589		8,408,401		8,484,328

Tangible Book Value per Share	$	23.42	$	22.39	$	21.46	$	20.86	$	20.18

Non-PPP Core Banking Loans

(Dollars in thousands, except	Mar. 31,		Dec. 31,		Sept. 30,		June 30,		Mar. 31,
per share data)	2021		2020		2020		2020		2020

Loans and leases, net of unearned interest	$	2,646,236	$	2,384,041	$	2,521,827	$	2,445,765	$	1,798,149
Less: PPP loans, net of deferred fees		590,035		388,313		613,924		588,667		—
Non-PPP core banking loans	$	2,056,201	$	1,995,728	$	1,907,903	$	1,857,098	$	1,798,149

CONSOLIDATED BALANCE SHEETS (Unaudited):

(Dollars in thousands, except share data)	Mar. 31, 2021			Dec. 31, 2020			Mar. 31, 2020
ASSETS
Cash and due from banks	$	36,109		$	31,284		$	31,763
Interest-bearing balances with other financial institutions		1,243			1,541			4,186
Federal funds sold		390,019			270,899			104,809
Total cash and cash equivalents		427,371			303,724			140,758

Investment securities held to maturity, at amortized cost		130,560			128,292			167,963
(fair value $133,519, $132,794, and $170,399)
Investment securities available for sale, at fair value		3,250			5,748			27,420
Equity securities available for sale, at fair value		508			515			515
Loans held for sale		25,842			25,506			15,534
Loans and leases, net of unearned interest		2,646,236			2,384,041			1,798,149
Less: Allowance for loan and lease losses		(13,591	)		(13,382	)		(10,014	)
Net loans and leases		2,632,645			2,370,659			1,788,135

Bank premises and equipment, net		24,710			24,886			26,247
Operating lease right of use asset		10,791			10,157			10,999
Finance lease right of use asset		3,222			3,267			3,402
Cash surrender value of life insurance		17,257			17,183			16,957
Restricted investment in bank stocks		6,860			7,594			4,555
Accrued interest receivable		11,855			12,971			8,786
Deferred income taxes		5,427			3,619			1,761
Goodwill		62,840			62,840			62,840
Core deposit and other intangibles, net		4,079			4,360			5,435
Foreclosed assets held for sale		154			134			1,718
Other assets		14,667			17,493			16,726
Total Assets	$	3,382,038		$	2,998,948		$	2,299,751
LIABILITIES & SHAREHOLDERS’ EQUITY
Deposits:
Noninterest-bearing demand	$	676,717		$	536,224		$	347,532
Interest-bearing demand		601,220			605,567			468,773
Money Market		770,800			720,506			507,138
Savings		201,225			195,038			174,849
Time		416,865			417,245			474,989
Total Deposits		2,666,827			2,474,580			1,973,281

Short-term borrowings		307,753			125,617			—
Long-term debt		75,030			75,115			23,364
Subordinated debt		44,586			44,580			42,059
Operating lease liability		11,828			11,200			12,070
Accrued interest payable		1,902			2,007			2,478
Federal income tax payable		1,321			—			—
Other liabilities		8,755			10,161			6,988
Total Liabilities		3,118,002			2,743,260			2,060,240

Shareholders’ Equity:
Common stock, par value $1.00 per share; 20,000,000 shares authorized; Shares issued: 8,514,547 at Mar. 31, 2021, 8,511,835 at Dec. 31, 2020, and 8,484,328 at Mar. 31, 2020; Shares outstanding: 8,416,095 at Mar. 31, 2021, 8,419,183 at Dec. 31, 2020 and 8,484,328 at Mar. 31, 2020		8,515			8,512			8,484
Additional paid-in capital		179,055			178,853			178,320
Retained earnings		77,888			70,175			52,759
Accumulated other comprehensive income (loss)		501			(57	)		(52	)
Treasury stock, shares at cost; 98,452 at Mar. 31, 2021 and 92,652 at Dec. 31, 2020		(1,923	)		(1,795	)		—
Total Shareholders’ Equity		264,036			255,688			239,511
Total Liabilities and Shareholders’ Equity	$	3,382,038		$	2,998,948		$	2,299,751

CONSOLIDATED STATEMENTS OF INCOME (Unaudited):


(Dollars in thousands, except per share data)	Three Months Ended March 31,
		2021		2020
INTEREST INCOME
Interest and fees on loans and leases	$	28,330	$	22,249
Interest and dividends on investment securities:
U.S. Treasury and government agencies		178		671
State and political subdivision obligations, tax-exempt		277		221
Other securities		302		153
Total interest and dividends on investment securities		757		1,045

Interest on other interest-bearing balances		2		15
Interest on federal funds sold		79		390
Total Interest Income		29,168		23,699
INTEREST EXPENSE
Interest on deposits		2,966		5,380
Interest on short-term borrowings		174		—
Interest on long-term and subordinated debt		703		654
Total Interest Expense		3,843		6,034
Net Interest Income		25,325		17,665
PROVISION FOR LOAN AND LEASE LOSSES		1,000		550
Net Interest Income After Provision for Loan and Lease Losses		24,325		17,115
NONINTEREST INCOME
Mortgage banking income		2,379		1,182
Income from fiduciary and wealth management activities		556		384
Service charges on deposits		152		205
ATM debit card interchange income		568		416
Net gain on sales of SBA loans		100		84
Merchant services income		92		83
Earnings from cash surrender value of life insurance		74		76
Net gain on sales of investment securities		—		132
Other income		791		372
Total Noninterest Income		4,712		2,934
NONINTEREST EXPENSE
Salaries and employee benefits		9,598		8,281
Occupancy expense, net		1,480		1,439
Equipment expense		751		713
Software licensing and utilization		1,445		1,221
Pennsylvania bank shares tax expense		300		405
FDIC Assessment		470		312
Legal and professional fees		426		352
Charitable contributions qualifying for State tax credits		270		35
Mortgage banking profit-sharing expense		120		—
Marketing and advertising expense		135		204
Telephone expense		136		134
Intangible amortization		281		323
Other expenses		2,146		2,162
Total Noninterest Expense		17,558		15,581
INCOME BEFORE PROVISION FOR INCOME TAXES		11,479		4,468
Provision for income taxes		2,167		650
NET INCOME	$	9,312	$	3,818

PER COMMON SHARE DATA:
Basic Earnings Per Common Share	$	1.11	$	0.45
Diluted Earnings Per Common Share	$	1.10	$	0.45
Cash Dividends Paid	$	0.24	$	0.23

NET INTEREST MARGIN (Unaudited):


	Average Balances, Income and Interest Rates on a Taxable Equivalent Basis
	For the Three Months Ended
(Dollars in thousands)	March 31, 2021									December 31, 2020
	Average						Average			Average						Average
	Balance		Interest				Rates			Balance		Interest				Rates
ASSETS:
Interest Bearing Balances	$	1,401	$	2				0.58	%	$	2,245	$	2				0.35	%
Investment Securities:
Taxable		78,456		385				1.99	%		92,317		490				2.11	%
Tax-Exempt		54,937		351		(a)		2.59	%		54,394		348		(a)		2.55	%
Total Securities		133,393		736				2.24	%		146,711		838				2.27	%

Federal Funds Sold		314,181		79				0.10	%		195,962		50				0.10	%
Loans and Leases, Net		2,531,917		28,406		(b)		4.55	%		2,442,562		31,094		(b)		5.06	%
Restricted Investment in Bank Stocks		7,052		95				5.46	%		7,285		103				5.62	%
Total Earning Assets		2,987,944		29,318				3.98	%		2,794,765		32,087				4.57	%

Cash and Due from Banks		34,040									36,831
Other Assets		164,266									180,862
Total Assets	$	3,186,250								$	3,012,458

LIABILITIES & SHAREHOLDERS’ EQUITY:
Interest-bearing Demand	$	602,015	$	578				0.39	%	$	610,904	$	650				0.42	%
Money Market		743,994		778				0.42	%		682,730		713				0.42	%
Savings		197,873		64				0.13	%		193,271		67				0.14	%
Time		413,673		1,546				1.52	%		423,573		1,813				1.70	%
Total Interest-bearing Deposits		1,957,555		2,966				0.61	%		1,910,478		3,243				0.68	%

Short Term Borrowings		203,518		174				0.35	%		166,284		145				0.35	%
Long-term Debt		75,062		204				1.10	%		75,146		208				1.10	%
Subordinated Debt		44,583		499				4.54	%		41,823		541				5.15	%
Total Interest-bearing Liabilities		2,280,718		3,843				0.68	%		2,193,731		4,137				0.75	%

Noninterest-bearing Demand		623,058									544,678
Other Liabilities		23,462									23,997
Shareholders’ Equity		259,012									250,052
Total Liabilities & Shareholders’ Equity	$	3,186,250								$	3,012,458

Net Interest Income (taxable equivalent basis)			$	25,475								$	27,950
Taxable Equivalent Adjustment				(150	)								(161	)
Net Interest Income			$	25,325								$	27,789

Total Yield on Earning Assets								3.98	%								4.57	%
Rate on Supporting Liabilities								0.68	%								0.75	%
Average Interest Spread								3.30	%								3.82	%
Net Interest Margin								3.46	%								3.98	%

	(a)	Includes tax-equivalent adjustments (calculated using statutory rates of 21 percent) of $74,000 and $73,000 for the three months ended March 31, 2021 and December 31, 2020, respectively, resulting from the tax-free municipal securities in the investment portfolio.
	(b)	Includes tax-equivalent adjustments (calculated using statutory rates of 21 percent) of $76,000 and $88,000 for the three months ended March 31, 2021 and December 31, 2020, respectively, resulting from the tax-free municipal loans in the commercial loans portfolio.

NET INTEREST MARGIN, CONTINUED (Unaudited):


	Average Balances, Income and Interest Rates on a Taxable Equivalent Basis
	For the Three Months Ended
(Dollars in thousands)	March 31, 2021									March 31, 2020
	Average						Average			Average						Average
	Balance		Interest				Rates			Balance		Interest				Rates
ASSETS:
Interest Bearing Balances	$	1,401	$	2				0.58	%	$	4,488	$	15				1.34	%
Investment Securities:
Taxable		78,456		385				1.99	%		133,502		740				2.23	%
Tax-Exempt		54,937		351		(a)		2.59	%		42,765		280		(a)		2.63	%
Total Securities		133,393		736				2.24	%		176,267		1,020				2.33	%

Federal Funds Sold		314,181		79				0.10	%		122,635		390				1.28	%
Loans and Leases, Net		2,531,917		28,406		(b)		4.55	%		1,771,444		22,341		(b)		5.07	%
Restricted Investment in Bank Stocks		7,052		95				5.46	%		4,660		84				7.25	%
Total Earning Assets		2,987,944		29,318				3.98	%		2,079,494		23,850				4.61	%

Cash and Due from Banks		34,040									30,580
Other Assets		164,266									147,924
Total Assets	$	3,186,250								$	2,257,998

LIABILITIES & SHAREHOLDERS’ EQUITY:
Interest-bearing Demand	$	602,015	$	578				0.39	%	$	455,685	$	1,172				1.03	%
Money Market		743,994		778				0.42	%		502,925		1,597				1.28	%
Savings		197,873		64				0.13	%		175,924		120				0.27	%
Time		413,673		1,546				1.52	%		480,316		2,491				2.09	%
Total Interest-bearing Deposits		1,957,555		2,966				0.61	%		1,614,850		5,380				1.34	%

Short-term Borrowings		203,518		174				0.35	%		—		—				0.00	%
Long-term Debt		75,062		204				1.10	%		28,780		252				3.52	%
Subordinated Debt		44,583		499				4.54	%		29,048		402				5.57	%
Total Interest-bearing Liabilities		2,280,718		3,843				0.68	%		1,672,678		6,034				1.45	%

Noninterest-bearing Demand		623,058									320,524
Other Liabilities		23,462									25,927
Shareholders’ Equity		259,012									238,869
Total Liabilities & Shareholders’ Equity	$	3,186,250								$	2,257,998

Net Interest Income (taxable equivalent basis)			$	25,475								$	17,816
Taxable Equivalent Adjustment				(150	)								(151	)
Net Interest Income			$	25,325								$	17,665

Total Yield on Earning Assets								3.98	%								4.61	%
Rate on Supporting Liabilities								0.68	%								1.45	%
Average Interest Spread								3.30	%								3.16	%
Net Interest Margin								3.46	%								3.45	%

	(a)	Includes tax-equivalent adjustments (calculated using statutory rates of 21 percent) of $74,000 and $59,000 for the three months ended March 31, 2021 and 2020, respectively, resulting from the tax-free municipal securities in the investment portfolio.
	(b)	Includes tax-equivalent adjustments (calculated using statutory rates of 21 percent) of $76,000 and $92,000 for the three months ended March 31, 2021 and 2020, respectively, resulting from the tax-free municipal loans in the commercial loans portfolio.

Management considers subsequent events occurring after the balance sheet date for matters which may require adjustment to, or disclosure in, the consolidated financial statements. The review period for subsequent events extends up to and including the filing date of a public company’s consolidated financial statements when filed with the Securities and Exchange Commission (“SEC”). Accordingly, the financial information in this announcement is subject to change. The statements are valid only as of the date hereof and Mid Penn Bancorp, Inc. disclaims any obligation to update this information.

SPECIAL CAUTIONARY NOTICE REGARDING FORWARD-LOOKING STATEMENTS

This press release, and oral statements made regarding the subjects of this release, contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are not historical facts and include expressions about management’s confidence and strategies and management’s current views and expectations about new and existing programs and products, relationships, opportunities, technology and market conditions. These statements may be identified by such forward-looking terminology as “continues,” “expect,” “look,” “believe,” “anticipate,” “may,” “will,” “should,” “projects,” “strategy” or similar statements. Actual results may differ materially from such forward-looking statements, and no reliance should be placed on any forward-looking statement. Factors that may cause results to differ materially from such forward-looking statements include, but are not limited to, changes in interest rates, spreads on earning assets and interest-bearing liabilities, and interest rate sensitivity; prepayment speeds, loan originations, credit losses and market values on loans, collateral securing loans, and other assets; sources of liquidity; common shares outstanding; common stock price volatility; the length and extent of the COVID-19 pandemic; fair value of and number of stock-based compensation awards to be issued in future periods; the impact of changes in market values on securities held in Mid Penn’s portfolio; the success and timing of PPP loan repayment and forgiveness; legislation affecting the financial services industry as a whole, and Mid Penn and Mid Penn Bank individually or collectively, including tax legislation; results of the regulatory examination and supervision process and oversight, including changes in monetary policy and capital requirements; changes in accounting policies or procedures as may be required by the Financial Accounting Standards Board or regulatory agencies; increasing price and product/service competition by competitors, including new entrants; rapid technological developments and changes; the ability to continue to introduce competitive new products and services on a timely, cost-effective basis; the mix of products/services; containing costs and expenses; governmental and public policy changes; protection and validity of intellectual property rights; reliance on large customers; technological, implementation and cost/financial risks in large, multi-year contracts; the outcome of future litigation and governmental proceedings, including tax-related examinations and other matters; continued availability of financing; the availability of financial resources in the amounts, at the times and on the terms required to support Mid Penn and Mid Penn Bank’s future businesses; and material differences in the actual financial results of merger, acquisition and investment activities compared with Mid Penn’s initial expectations, including the full realization of anticipated cost savings and revenue enhancements.

For a more detailed description of these and other factors which would affect our results, please see Mid Penn’s filings with the SEC, including those risk factors identified in the “Risk Factors” section and elsewhere in our Annual Report on Form 10-K for the year ended December 31, 2020. The statements in this press release are made as of the date of this press release, even if subsequently made available by Mid Penn on its website or otherwise. Mid Penn assumes no obligation for updating any such forward-looking statements at any time, except as required by law.

CONTACTS

Rory G. Ritrievi
President & Chief Executive Officer

Michael D. Peduzzi, CPA
Chief Financial Officer

Mid Penn Bancorp, Inc.
349 Union Street
Millersburg, PA 17061
1-866-642-7736