FOURTH QUARTER
2017
Nasdaq:HMST
as of January 31, 2018
Important Disclosures
Forward-Looking Statements
This presentation includes forward-looking statements, as that term is defined for purposes of applicable securities laws, about our industry, our future financial performance and business plans
and expectations. These statements are, in essence, attempts to anticipate or forecast future events, and thus subject to many risks and uncertainties. These forward-looking statements are
based on our management's current expectations, beliefs, projections, future plans and strategies, anticipated events or trends, and similar expressions concerning matters that are not
historical facts, as well as a number of assumptions concerning future events. Forward-looking statements in this release include, among other matters, statements regarding our business plans
and strategies, general economic trends (particularly those that affect mortgage origination and refinance activity) and growth scenarios and performance targets. Readers should note,
however, that all statements in this presentation other than assertions of historical fact are forward-looking in nature. These statements are subject to risks, uncertainties, assumptions and other
important factors set forth in our SEC filings, including but not limited to our annual report on Form 10-K for the year ended December 31, 2107, which we expect to file on March 6, 2018. Many
of these factors and events that affect the volatility in our stock price and shareholders’ response to those events and factors are beyond our control. Such factors could cause actual results to
differ materially from the results discussed or implied in the forward-looking statements. These risks include without limitation changes in general political and economic conditions that impact
our markets and our business, actions by the Federal Reserve Board and financial market conditions that affect monetary and fiscal policy, regulatory and legislative findings or actions that may
increase capital requirements or otherwise constrain our ability to do business, including restrictions that could be imposed by our regulators on certain aspects of our operations or on our
growth initiatives and acquisition activities, risks related to our ability to realize the expected cost savings from our recent restructuring activities in our single family mortgage lending operations,
continue to expand our commercial and consumer banking operations, grow our franchise and capitalize on market opportunities, manage our overall growth efforts cost-effectively to attain the
desired operational and financial outcomes, manage the losses inherent in our loan portfolio, make accurate estimates of the value of our non-cash assets and liabilities, maintain electronic and
physical security of customer data, respond to restrictive and complex regulatory environment, and attract and retain key personnel. In addition, the volume of our mortgage banking business
as well as the ratio of loan lock to closed loan volume may fluctuate due to challenges our customers may face in meeting current underwriting standards, a change in interest rates, an increase
in competition for such loans, changes in general economic conditions, including housing prices and inventory levels, the job market, consumer confidence and spending habits either nationally
or in the regional and local market areas in which the Company does business, and legislative or regulatory actions or reform that may affect our business or the banking or mortgage industries
more generally. Actual results may fall materially short of our expectations and projections, and we may change our plans or take additional actions that differ in material ways from our current
intentions. Accordingly, we can give no assurance of future performance, and you should not rely unduly on forward-looking statements. All forward-looking statements are based on information
available to the Company as of the date hereof, and we do not undertake to update or revise any forward-looking statements, for any reason.
Basis of Presentation of Financial Data
Unless noted otherwise in this presentation, all reported financial data is being presented as of the period ending December 31, 2017, and is unaudited, although certain information related to
the year ended December 31, 2016, has been derived from our audited financial statements. All financial data should be read in conjunction with the notes in our consolidated financial
statements.
Non-GAAP Financial Measures
Information on any non-GAAP financial measures such as core measures or tangible measures referenced in this presentation, including a reconciliation of those measures to GAAP measures,
may also be found in the appendix, our SEC filings, and in the earnings release available on our web site.
2
Important Additional Information
Important Additional Information
HomeStreet, Inc. (“HMST” or the “Company”), its directors and certain of its executive officers are participants in the solicitation of proxies from the Company’s shareholders in connection with
the Company’s 2018 annual meeting of shareholders. The Company intends to file a proxy statement and white proxy card with the U.S. Securities and Exchange Commission (the “SEC”) in
connection with any such solicitation of proxies from the Company’s shareholders. SHAREHOLDERS OF THE COMPANY ARE STRONGLY ENCOURAGED TO READ SUCH PROXY
STATEMENT, ACCOMPANYING WHITE PROXY CARD AND ALL OTHER DOCUMENTS FILED WITH THE SEC CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME
AVAILABLE AS THEY WILL CONTAIN IMPORTANT INFORMATION. Exhibit 99.2 of the Company's Current Report on Form 8-K filed with the SEC on January 25, 2018 ("Exhibit 99.2")
contains information regarding the direct and indirect interest, by securities holdings or otherwise, of the Company’s directors and executive officers in the Company's securities. In the event
that the holdings of the Company's securities change from the amounts provided in Exhibit 99.2, such changes will be set forth in SEC filings on Forms 3, 4 and 5, which can be found through
the Company’s website at www.homestreet.com in the section “Investor Relations” or through the SEC’s website at www.sec.gov. Information can also be found in the Company’s other SEC
filings, including the Company’s definitive proxy statement for the 2017 annual meeting of shareholders and its Annual Report on Form 10-K for the fiscal year ended December 31, 2016.
Updated information regarding the identity of potential participants, and their direct or indirect interests, by security holdings or otherwise, will be set forth in the Company’s definitive proxy
statement and other materials to be filed with the SEC in connection with the 2018 annual meeting of shareholders. Shareholders will be able to obtain any proxy statement, any amendments or
supplements to the proxy statement and other documents filed by the Company with the SEC at no charge at the SEC’s website at www.sec.gov. Copies will also be available at no charge at
the Company’s website at www.homestreet.com in the section “Investor Relations.”
3
Who is HomeStreet?
• Seattle‐based diversified
commercial bank ‐
company founded in 1921
• Expanding West Coast
Franchise
• Growing commercial &
consumer bank with
concentrations in major
metropolitan areas of the
West Coast and Hawaii
• 110 branches and primary
offices (1) in the Western
United States and Hawaii
• Market leading mortgage
originator and servicer
• Total assets $6.7 billion
4
(1) The number of offices listed above does not include satellite offices with a limited number of staff who report to a manager located
in a separate primary office.
Strategy
Optimize Single Family
Mortgage Banking &
Servicing Segment
• Grow and diversify loan portfolio with focus on building meaningful commercial lending
platform
• Implement process improvements to gain efficiencies
• Grow core deposits to improve deposit mix and support asset growth
• Analyze and expand product offerings and technology
• Committed to being a leading mortgage originator and servicer in our markets with retail
focus, broad product mix, and competitive pricing
• Focus on optimizing mortgage banking capacity within existing geographic footprint
• Leverage mortgage customer distribution through marketing bank products and services
• Execute on digital strategy with a focus on improved customer experience
• Mitigate cost of growth through operating leverage and disciplined expense control
• Target consolidated efficiency ratio of less than 75%
• Commercial and Consumer segment <65% and Mortgage Banking segment <85%
• Prudent levels of capital above regulatory requirements
• ROTE target of >12%
Expand Commercial &
Consumer Banking
Segment
Disciplined expense
management
Efficient use of capital
Grow and diversify earnings with the goal of becoming a leading West Coast
regional bank
5
$1,000
$2,000
$3,000
$4,000
$5,000
1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17
$
i
n
m
i
l
l
i
o
n
s
Total Deposits
Compounded Annual Growth Rate: 21%
Capitol Hill
Everett
Ballard
Greenlake
Madison PK
Phinney Ridge
University
Issaquah
Kaimuki
Mission Gorge
Kearny Mesa
Riverside
Point Loma
Kennewick Baldwin Park
Redmond
Spokane
Delivering Consistent Growth
6
De novo branch openings
$2,000
$3,000
$4,000
$5,000
$6,000
$7,000
$8,000
1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17
$
i
n
m
i
l
l
i
o
n
s
Total Assets
Compounded Annual Growth Rate: 23%
Compunded Organic Growth Rate: 16%
Organic Acquired
November 2013:
Fortune ($142M)
&
Yakima ($125M)
March 2015:
Simplicity
($879M)
February 2016:
OCBB ($200M)
August 2016:
The Bank of
Oswego
($42M)December 2015:
1 Branch ($26M)
December 2013:
2 Branches ($32M)
November 2016:
2 Branches
($105M)
September 2017:
1 Branch ($22M)
$8.9
$16.7
$21.0
$35.4
$46.6
33%
69%
47%
56%
96%
0%
20%
40%
60%
80%
100%
120%
$‐
$10
$20
$30
$40
$50
2013 2014 2015 2016 2017
$ in millions
C&CB Core Net Income (1) C&CB % of Total Core Net Income (1)
Diversification
Growth in our Commercial & Consumer Banking Segment is diversifying earnings
and reducing earnings volatility
7
(1) Excludes impact of income tax reform-related benefit and restructuring and acquisition-related expenses, net of tax. See appendix for reconciliation
of non-GAAP financial measures.
8
Operating Highlights
Results of Operations
• Year-end 2017 core net income of $48.4 million, or $1.79 diluted EPS(1)
• Record core net income of $46.6 million in Commercial and Consumer Banking Segment, core ROTE of 9.63% (1)
• Core net income of $1.8 million in Mortgage Banking Segment – results challenged by West Coast market conditions
• Fourth quarter 2017 core net income of $11.5 million, or $0.42 diluted EPS (1)
• Results included a one-time, non-cash tax benefit of $23.3 million, or $0.86 per diluted share, as a result of Tax Reform
• Total assets ended Dec. 31, 2017, at $6.7 billion, loans held for investment at $4.5 billion, increased 4% from Sep. 30, 2017
• Loans held for investment grew organically 18% during 2017
• Total deposits of $4.8 billion, increased 7.5% from Dec. 31, 2016
• Nonperforming asset ratio of 0.23%, the lowest level of problem assets since 2006
Strategic Results
• Opened a retail deposit branch and commercial lending office in Spokane, WA
• Sold a portfolio of securities acquired as part of merger transactions at a net loss of $534,000 to take advantage of the change in
corporate income tax rates
Recent Developments
• Appointed Mark Patterson to the Board of Directors replacing Timothy Chrisman. Mark was a career institutional investor with
significant banking experience, public company board experience, and is now a significant individual shareholder in the Company
• Effective income tax rate, before discrete items, will decline from 31% to an estimated 21% to 22% in 2018 as a result of Tax
Reform
(1) Excludes impact of income tax reform-related benefit and restructuring and acquisition-related expenses, net of tax. See appendix for reconciliation
of non-GAAP financial measures.
Results of Operations
For the three months ended
(1) Excludes impact of income tax reform-related benefit and restructuring and acquisition-related expenses, net of tax. See appendix for
reconciliation of non-GAAP financial measures.
(2) See appendix for reconciliation of non-GAAP financial measures.
For the nine months ended
9
($ in thousands)
Dec. 31,
2017
Dec. 31,
2016
Dec. 31,
2017
Dec. 31,
2016
Net interest income $ 51,079 $ 48,074 $ 194,438 $ 180,049
Provision for credit losses - 350 750 4,100
Noninterest income 72,801 73,221 312,154 359,150
Noninterest expense 106,838 117,539 439,653 444,322
Net income before taxes 17,042 3,406 66,189 90,777
Income taxes (17,873) 1,112 (2,757) 32,626
Net income $ 34,915 $ 2,294 $ 68,946 $ 58,151
Diluted EPS $ 1.29 $ 0.09 $ 2.54 $ 2.34
Core net income (1) $ 11,467 $ 2,555 $ 48,429 $ 62,789
Core EPS (1) $ 0.42 $ 0.10 $ 1.79 $ 2.53
Tangible BV/share (2) $ 25.09 $ 22.33 $ 25.09 $ 22.33
Core ROAA (1) 0.67% 0.16% 0.73% 1.09%
Core ROAE (1) 6.54% 1.67% 7.17% 11.09%
Core ROATE (1) 6.83% 1.74% 7.50% 11.68%
Net Interest Margin 3.33% 3.42% 3.31% 3.45%
Core efficiency ratio (1) 86.4% 96.6% 85.9% 81.1%
Tier 1 Leverage Ratio (Bank) 9.67% 10.26% 9.67% 10.26%
Total Risk-Based Capital (Bank) 14.07% 14.69% 14.07% 14.69%
For the three months ended For the twelve months ended
3.42%
0.03
0.032
0.034
0.036
0.038
0.04
0.042
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
3.50%
4.00%
N
e
t
I
n
t
e
r
e
s
t
M
a
r
g
i
n
(
%
)
N
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t
I
n
t
e
r
e
s
t
I
n
c
o
m
e
(
i
n
m
i
l
l
i
o
n
s
)
$48.1
$45.7
$46.9
$50.8 $51.1
3.42%
3.23%
3.29%
3.40%
3.33%
2.80%
3.00%
3.20%
3.40%
3.60%
3.80%
4.00%
$‐
$10.0
$20.0
$30.0
$40.0
$50.0
$6 .0
4Q16 1Q17 2Q17 3Q17 4Q17
N
e
t
I
n
t
e
r
e
s
t
M
a
r
g
i
n
(
%
)
N
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e
s
t
I
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c
o
m
e
(
i
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m
i
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l
i
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s
)
Net Interest Income & Margin
• 4Q17 Net Interest Margin declined 7 bps and net interest income increased $0.3 million compared
to the prior quarter
• Net interest income growth primarily due to growth in average loans held for investment balances
• NIM contracted primarily due to changes in the composition and cost of interest-bearing liabilities –
primarily higher rates on FHLB borrowings
10
$5.71 $5.78 $5.84
$6.10
$6.27
3.60%
3.70%
3.80%
3.90%
4.00%
4.10%
4.20%
4.30%
$0.00
$1.00
$2.00
$3.00
$4.00
$5.00
$6.00
$7.00
4Q16 1Q17 2Q17 3Q17 4Q17
A
v
e
r
a
g
e
Y
i
e
l
d
A
v
e
r
a
g
e
B
a
l
a
n
c
e
s
(
i
n
b
i
l
l
i
o
n
s
)
Loans Held for Sale
Cash & Cash Equivalents
Investment Securities
Loans Held for Investment
Average Yield
Interest‐Earning Assets
• Average total interest-earning assets increased $172 million or 3% in 4Q
• Loans held for investment ending balances increased $193 million or 4% during the quarter
Avg. Yield 4.03% 3.90% 3.96% 4.12% 4.12%
11
HomeStreet Available for Sale Portfolio
As of 12/31/2017 2017 YTD Total
Return (1)
Yield (2) Duration (2)
HomeStreet Investment Portfolio 3.97 3.21 5.11
Composition Adjusted Barclays US Aggregate Index (3) 3.91 3.08 4.96
HMST performance data: Bloomberg PORT+
(1) As of December 31, 2017
(2) Yield and duration Include FTE adjustment. Yields are at current market prices, not
book. Duration adjusted using 35% effective tax rate
(3) Barclays US Aggregate Index Adjusted to reflect HMST portfolio composition
• AFS Investment security portfolio market
value is $846m
• The investment portfolio has an average
credit rating of Aa2
12
31%
3%
18%
46%
1%
1%
Investment portfolio composition as of
12/31/2017
CMO
Corporates
MBS
Municipal
Short‐Term Muni
Treasury
$5.7 $4.9 $6.3 $4.6 $5.0
$9.2 $8.8 $8.3 $9.1
$67.8
$60.3
$65.9 $71.0
$58.7
$73.2 $74.5
$81.0
$83.9
$72.8
$‐
$10.0
$20.0
$30.0
$40.0
$50.0
$60.0
$70.0
$80.0
$90.0
4Q16 1Q17 2Q17 3Q17 4Q17
N
o
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e
s
t
I
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c
o
m
e
(
i
n
m
i
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l
i
o
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s
)
Net gain on mortgage loan
origination and sale activities
Loan servicing income
Other noninterest income
Noninterest Income
• Noninterest income decreased 13% to $72.8 million in 4Q primarily due to lower net gain on loan origination
and sale activities related to a decline in single family rate lock volume
• Net gain on loan origination and sale activities decreased $12.3 million primarily due to 18% lower single
family rate lock volume
13
$117.5
$106.9
$111.2 $114.7
$106.8
1,600
1,800
2,000
2,200
2,400
2,600
2,800
3,000
$‐
$20.0
$40.0
$60.0
$80.0
$100.0
$120.0
$140.0
4Q16 1Q17 2Q17 3Q17 4Q17
F
T
E
N
o
n
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t
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e
s
t
E
x
p
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n
s
e
(
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)
Core noninterest expense Restructuring‐related expenses Merger‐related expenses FTE
Total noninterest expense $117.5 $106.9 $111.2 $114.7 $106.8
Restructuring‐related expenses $0.0 $0.0 $0.1 $3.9 ($0.3)
Merger‐related expenses $0.4 $0.0 $0.2 $0.4 $0.1
Core noninterest expense (1) $117.1 $106.9 $111.0 $110.5 $107.0
Core salaries & related costs (1) $81.7 $71.3 $76.3 $74.8 $70.8
Core general & administrative (1) $15.9 $17.1 $15.9 $16.1 $15.9
Core other noninterest expense (1) $19.5 $18.5 $18.8 $19.6 $20.3
FTE 2,552 2,581 2,542 2,463 2,419
Core efficiency ratio (1) 96.6% 89.0% 86.8% 82.0% 86.4%
Noninterest Expense
• Excluding restructuring and acquisition-related expenses, core noninterest expense declined $3.5 million in 4Q,
primarily due to decreased commissions resulting from lower closed loan volume and cost savings related to
restructuring plans implemented in 2Q and 3Q
• Noninterest expense will continue to vary primarily based on headcount and mortgage origination volume
(1) Excludes restructuring and acquisition-related expenses, which are shown in “restructuring-related expenses” and “merger-related
expenses” in the table. See appendix for reconciliation of non-GAAP financial measures. 14
Commercial & Consumer Banking
15
Commercial & Consumer Banking Segment Overview
Overview
• Strategic focus on major coastal markets of
Western U.S
• Diversify and grow loan portfolio average of 2-
4% per quarter(1)
• Manage revenue growth to exceed non-interest
expense growth, creating operating leverage
• Credit strategy of generally competing on price
and not on credit terms
• Manage credit risk by monitoring portfolio and
geographic early warning indicators
• Long-term efficiency ratio target of <65%
• Long-term targeted ROE > 10%
Strategic Objectives
• Commercial Banking
Commercial lending, including SBA
All CRE property types with multifamily focus
FNMA DUS lender / servicer
Residential and commercial construction
Commercial deposit, treasury and cash
management services
• Consumer Banking
Consumer loan and deposit products
Consumer investment, insurance and private
banking products and services
(1) Actual growth of loan portfolio is subject to, among other things, actual loan production volumes, portfolio runoff, portfolio loan sales, portfolio credit
performance, net interest margin, and market forces. Other portfolio management considerations include liquidity management, capital requirements and
profitability. 16
Commercial & Consumer Banking Segment
17
(1) Excludes impact of income tax reform-related expense and acquisition-related expenses, net of tax. See appendix for reconciliation of
non-GAAP financial measures.
($ in thousands)
Dec. 31,
2017
Dec. 31,
2016
Dec. 31,
2017
Dec. 31,
2016
Net interest income $ 45,876 $ 40,637 $ 174,542 $ 154,015
Provision for credit losses - 350 750 4,100
Noninterest income 12,697 13,087 42,360 35,682
Noninterest expense 38,716 35,482 148,976 138,386
Net income before taxes 19,857 17,892 67,176 47,211
Income taxes 10,496 5,846 25,114 16,412
Net income $ 9,361 $ 12,046 $ 42,062 $ 30,799
Core net income (1) $ 13,568 $ 12,307 $ 46,612 $ 35,438
Core ROAA (1) 0.91% 0.95% 0.82% 0.74%
Core ROAE (1) 9.55% 9.89% 8.65% 7.64%
Core ROATE (1) 10.08% 10.54% 9.16% 8.14%
Core efficiency ratio (1) 66.0% 65.3% 68.4% 69.2%
Net Interest Margin 3.26% 3.37% 3.25% 3.42%
Total average earning assets $5,492,058 $4,832,575 $ 5,281,784 $ 4,535,603
FTE 1,068 998 1,068 998
For the three months ended For the twelve months ended
Commercial & Consumer Banking Segment – Quarter Trend
18
(1) Excludes impact of income tax reform-related expense and acquisition-related expenses, net of tax. See appendix for reconciliation of
non-GAAP financial measures.
($ in thousands)
Dec. 31,
2017
Sept. 30,
2017
Jun. 30,
2017
Mar. 31,
2017
Dec. 31,
2016
Net interest income $ 45,876 $ 45,314 $ 42,448 $ 40,904 $ 40,637
Provision for credit losses - 250 500 - 350
Noninterest income 12,697 11,962 8,276 9,425 13,087
Noninterest expense 38,716 37,160 36,631 36,470 35,482
Net income before taxes 19,857 19,866 13,593 13,859 17,892
Income taxes 10,496 5,904 4,147 4,567 5,846
Net income $ 9,361 $ 13,962 $ 9,446 $ 9,292 $ 12,046
Core net income (1) $ 13,568 $ 14,191 $ 9,561 $ 9,292 $ 12,307
Core ROAA (1) 0.91% 1.00% 0.69% 0.69% 0.95%
Core ROAE (1) 9.55% 10.35% 7.16% 7.38% 9.89%
Core ROATE (1) 10.08% 10.94% 7.59% 7.85% 10.54%
Core efficiency ratio (1) 66.0% 64.3% 71.9% 72.5% 65.3%
Net Interest Margin 3.26% 3.33% 3.22% 3.19% 3.37%
Total average earning assets $5,492,058 $5,305,367 $5,229,120 $5,095,982 $4,832,575
FTE 1,068 1,071 1,055 1,022 998
For the three months ended
Loan Production/Loan Balance Trend
19
C
o
m
m
i
t
m
e
n
t
s
B
a
l
a
n
c
e
s
($ in millions)
Single Family $207 28% $188 23% $143 18% $75 14% $55 8%
Single Family Custom Home Construction $53 7% $61 8% $63 8% $48 9% $58 8%
Home Equity and other $98 13% $81 10% $92 11% $80 15% $68 10%
Total Consumer Loans $358 48% $330 41% $298 37% $203 37% $181 26%
Non-owner occupied commercial real estate $45 6% $54 7% $80 10% $29 5% $79 11%
Multifamily $55 7% $122 15% $122 15% $107 20% $140 20%
Residential Construction $167 23% $167 21% $154 19% $133 24% $132 19%
Commercial Real Estate/Multifamily Construction $64 8% $72 9% $65 8% $21 4% $95 13%
Total Commercial Real Estate Loans (1) $331 44% $415 52% $421 52% $291 53% $447 63%
Owner occupied commercial real estate $29 4% $31 4% $27 3% $22 4% $47 7%
Commercial business $28 4% $29 4% $62 8% $28 5% $29 4%
Total Commercial and Industrial Loans $57 8% $60 7% $89 11% $50 9% $76 11%
Total $746 100% $805 100% $808 100% $544 100% $704 100%
Dec. 31, 2017 Sept. 30, 2017 Jun. 30, 2017 Mar. 31, 2017 Dec. 31, 2016
($ in millions)
Single Family $1,381 30% $1,269 29% $1,148 27% $1,100 28% $1,083 28%
Single Family Custom Home Construction $145 3% $138 3% $149 4% $134 3% $150 4%
Home Equity and other $454 10% $437 10% $414 10% $381 10% $360 9%
Total Consumer Loans $1,980 43% $1,844 42% $1,711 41% $1,615 41% $1,593 41%
Non-owner occupied commercial real estate $623 14% $651 15% $617 15% $600 15% $588 15%
Multifamily $728 16% $747 17% $781 19% $748 19% $674 18%
Residential Construction $310 7% $285 7% $281 7% $263 7% $259 7%
Commercial Real Estate/Multifamily Construction $232 5% $231 5% $219 5% $214 5% $228 6%
Total Commercial Real Estate Loans $1,893 42% $1,914 44% $1,898 45% $1,825 46% $1,749 45%
Owner occupied commercial real estate $392 9% $335 8% $325 8% $323 8% $283 7%
Commercial business $265 6% $246 6% $249 6% $223 6% $224 6%
Total Commercial and Industrial Loans $657 15% $581 14% $574 14% $546 14% $507 13%
Total Loans Held for Investment
(before Deferred Fees and Allowance) $4,530 100% $4,339 100% $4,183 100% $3,986 100% $3,849 100%
Dec. 31, 2017 Sept. 30, 2017 Jun. 30, 2017 Mar. 31, 2017 Dec. 31, 2016
$1.74
billion
20
Highly diversified loan portfolio by product and geography
$4.53
billion
$688
million
Construction by
property type
Loan Portfolio
1
(1) Includes owner occupied CRE
Other Includes: AK,AZ, CO,HI,ID,NV,TX,UTCA‐Los Angeles County
•Additional property types are
reviewed on a case by case basis
• Includes acquired loan types
• Examples include: Self Storage &
Hotel
•Up To 15 Year Term
• $30MM Loan Amt. Max
• ≥ 1.25 DSCR
•Avg. LTV @ Orig. ~ 62%
•Up To 15 Year Term
• $30MM Loan Amt. Max
• ≥ 1.25 DSCR
•Avg. LTV @ Orig. ~ 68%
•Up To 30 Year Term
• $30MM Loan Amt. Max
• ≥ 1.15 DSCR
•Avg. LTV @ Orig. ~ 61%
•Up To 15 Year Term
• $30MM Loan Amt. Max
• ≥ 1.25 DSCR
•Avg. LTV @ Orig. ~ 68%
CA‐OtherOregonWA‐OtherWA‐Puget Sound
Commercial Real Estate Perm Lending Overview
21
HomeStreet lends within the full spectrum of commercial real estate lending types, but is deliberate in achieving diversification among
property types and geographic areas to mitigate concentration risk
Balance: $268M
% of Balances: 15%
% Owner Occupied: 24%
Portfolio LTV ~ 52% (1)
Portfolio Avg. DSCR ~ 1.73x
Avg. Loan Size: $3.8M
Largest Dollar Loan: $19.4M
12/31/17 Balances Outstanding totaling $1.74 billion
Loan Characteristics
Commercial Real Estate Property Types
Multifamily OfficeIndustrial/
Warehouse
Retail Other
Balance: $727M
% of Balances: 42%
Portfolio Avg. LTV ~ 55% (1)
Portfolio Avg. DSCR ~ 1.53x
Avg. Loan Size: $3.5M
Largest Dollar Loan: $26.0M
Geographical Distribution (balances)
Balance: $229M
% of Balances: 13%
% Owner Occupied: 51%
Portfolio LTV ~ 56% (1)
Portfolio Avg. DSCR ~ 1.61x
Avg. Loan Size: $1.3M
Largest Dollar Loan: $12.1M
Balance: $340M
% of Balances: 20%
% Owner Occupied: 25%
Portfolio LTV ~ 59% (1)
Portfolio Avg. DSCR ~ 1.73x
Avg. Loan Size: $3.9M
Largest Dollar Loan: $25.3M
Balance: $179M
% of Balances: 10%
% of Owner Occupied: 25%
Portfolio LTV ~ 45% (1)
Portfolio Avg. DSCR ~ 1.77x
Avg. Loan Size: $2.7M
Largest Dollar Loan: $27.3M
(1) Property values as of origination date
Construction Lending Overview
22
Construction lending is a broad category that includes many different loan types, which are often characterized by different risk profiles.
HomeStreet lends within the full spectrum of construction lending types, but is deliberate in achieving diversification among the types to
mitigate risk. Additionally, recent geographic expansion has provided an opportunity to increase diversification.
Balance: $212M
Unfunded Commitments: $273M
% of Balances: 31%
% of Unfunded Commitments: 39%
Avg. Loan Size: $634K
Largest Dollar Loan: $6.2M
12/31/17 Balances and Commitments totaling $688 million
Loan Characteristics
Construction Lending Types
Custom Home
Construction
Multifamily Commercial Residential
Construction
Land & Lots
•12 Month Term
•Consumer Owner Occupied
•Borrower Underwritten
similar to Single Family
Balance: $145M
Unfunded Commitments: $126M
% of Balances: 21%
% of Unfunded Commitments: 18%
Avg. Loan Size: $481K
Largest Dollar Loan: $2.3M
Geographical Distribution (balances)
Balance: $218M
Unfunded Commitments: $214M
% of Balances: 32%
% of Unfunded Commitments: 30%
Avg. Loan Size: $3.5M
Largest Dollar Loan: $23.4M
Balance: $40M
Unfunded Commitments: $76M
% of Balances: 6%
% of Unfunded Commitments: 11%
Avg. Loan Size: $9.7M
Largest Dollar Loan: $14.5M
Balance: $72M
Unfunded Commitments: $18M
% of Balances: 10%
% of Commitments: 3%
Avg. Loan Size: $1.4M
Largest Dollar Loan: $4.3M
Seattle Metro Puget Sound Other WA Other Portland Metro OR Other Hawaii California Utah Idaho Other : AZ,CO
•18‐36 Month Term
•≤ 80% LTC
•Minimum 15% Cash Equity
•≥ 1.15 DSC
•Portfolio LTV ~ 61%
•18‐36 Month Term
•≤ 80% LTC
•Minimum 15% Cash Equity
•≥ 1.25 DSC
•≥ 50% pre‐leased office/retail
•Portfolio LTV ~65%
•12‐18 Month Term
•LTC: ≤ 95% Presale & Spec
•Leverage, Liquid. & Net Worth
Covenants as appropriate
•Portfolio LTV ~ 66%
•12‐24 Month Term
•≤ 50% ‐80% LTC
• Strong, experienced,
vertically integrated builders
•Portfolio LTV ~ 65%
Credit Quality
23
• Credit Quality continues to reflect excellent loan quality:
• Nonperforming assets declined to 0.23% of total assets compared to 0.28% in 3Q17
• Nonperforming loans declined to $15.0 million compared to $15.1 million in 3Q17
• OREO balances decreased to $0.7 million compared to $3.7 million in 3Q17
• Total delinquencies (adjusted2) declined to 0.37% compared to 0.44% in 3Q17
(1) Nonperforming assets includes nonaccrual loans and OREO, excludes performing TDRs and SBAs
(2) Total delinquencies and total loans - adjusted (net of Ginnie Mae EBO loans (FHA/VA loans) and guaranteed portion of SBA loans)
(3) Not available at time of publishing
(4) While not a loss reserve, purchase discounts are available to absorb credit related losses on loans purchased with discounts
(5) Credit peer group selected in consultation with our regulators comprising banks with similar loan portfolio characteristics
($ in thousands) HMST Peer Mdn (5) HMST Peer Mdn (5) HMST Peer Mdn (5) HMST Peer Mdn (5) HMST Peer Mdn (5)
Nonperforming assets (1) $15,705 -- $18,827 -- $20,073 -- $24,322 -- $25,785 --
Nonperforming loans $15,041 -- $15,123 -- $15,476 -- $18,676 -- $20,542 --
OREO $664 -- $3,704 -- $4,597 -- $5,646 -- $5,243 --
Nonperforming assets/total assets (1) 0.23% (3) 0.28% 0.32% 0.30% 0.33% 0.38% 0.31% 0.41% 0.35%
Nonperforming loans/total loans 0.33% (3) 0.35% 0.37% 0.37% 0.33% 0.47% 0.28% 0.53% 0.35%
Total delinquencies/total loans 1.52% (3) 1.60% 0.67% 1.56% 0.69% 1.67% 0.67% 1.88% 0.74%
Total delinquencies/total loans - adjusted (2) 0.37% (3) 0.44% 0.61% 0.45% 0.67% 0.50% 0.67% 0.58% 0.74%
ALLL / total loans 0.83% (3) 0.85% 1.08% 0.86% 1.09% 0.87% 1.19% 0.88% 1.20%
ALLL / Nonperforming loans (NPLs) 251.63% (3) 245.02% 263.34% 233.50% 277.19% 185.99% 345.22% 165.52% 334.43%
ALLL / total loans, excluding purchased loans 0.90% -- 0.93% -- 0.95% -- 0.97% -- 1.00% --
Purchased Discount & Reserves/Gross Purchased Loans (4) 2.87% -- 2.98% -- 3.03% -- 2.93% -- 2.96% --
Jun. 30, 2017Dec. 31, 2017 Mar. 31, 2017 Dec. 31, 2016Sept. 30, 2017
Deposits
24
10% 9% 9% 11% 8%
25% 26% 27% 25% 25%
54% 52%
51% 51% 54%
12% 13%
12% 13% 12%
$4,430 $4,596
$4,748 $4,670 $4,761
$‐
$500
$1,000
$1,500
$2,000
$2,500
$3,000
$3,500
$4,000
$4,500
$5,000
12/31/2016 3/31/2017 6/30/2017 9/30/2017 12/31/2017
B
a
l
a
n
c
e
s
(
i
n
m
i
l
l
i
o
n
s
)
Noninterest‐Bearing Transaction &
Savings Deposits
Interest‐Bearing Transaction & Savings
Deposits
Time Deposits
Mortgage Svcg. Escrow Accts. & Other
Total Cost of Deposits 0.51% 0.52% 0.52% 0.53% 0.57%
• Total deposits of $4.76 billion at December 31, 2017 increased $90 million or 2% from September 30, 2017 and
increased $331 million or 7% from December 31, 2016
• Transaction and savings accounts increased 6% from the prior quarter, primarily due to growth in business money
market deposit balances
• Deposit growth during the quarter of 6% in our de novo branches, those opened within five years. Opened 19
branches, or 32% of our total network, since 2012
Mortgage Banking
25
Mortgage Banking Segment Overview
Overview
• Optimize operations and origination capacity to
match market conditions
• Leverage new loan origination system to drive
operational efficiency, provide stronger
compliance management controls and improve
customer service
• Use retail focus, broad product mix, technology,
and competitive pricing to increase market share
• Long-term efficiency ratio target of <85%
• Long-term targeted ROE of >20%
Strategic Objectives
• Regional Single Family mortgage origination and
servicing platform
• Retail origination platform
• Majority of production sold into secondary
market
• Fannie Mae, Freddie Mac, FHA, VA lender since
programs’ inceptions
• Portfolio products: jumbo, HELOC and custom
home construction
• Servicing retained on majority of originated loans
sold to secondary markets
• Optimize existing investment in infrastructure
and personnel
(1) Actual growth of loan portfolio is subject to, among other things, actual loan production volumes, portfolio runoff, portfolio loan sales, portfolio credit
performance, net interest margin, and market forces. Other portfolio management considerations include liquidity management, capital requirements and
profitability. 26
Mortgage Banking Segment
27
($ in thousands)
Dec. 31,
2017
Dec. 31,
2016
Dec. 31,
2017
Dec. 31,
2016
Net interest income $ 5,203 $ 7,437 $ 19,896 $ 26,034
Noninterest income 60,104 60,134 269,794 323,468
Noninterest expense 68,122 82,057 290,676 305,937
Net income (loss) before taxes (2,815) (14,486) (986) 43,565
Income taxes (28,369) (4,734) (27,871) 16,214
Net income (loss) $ 25,554 $ (9,752) $ 26,885 $ 27,351
Core net income (loss) (1) $ (2,101) $ (9,752) $ 1,817 $ 27,351
Core ROAA (1) (0.84)% (3.55)% 0.20% 2.79%
Core ROATE (1) (5.88)% (31.91)% 1.31% 26.78%
Core efficiency ratio (1) 104.7% 121.4% 99.1% 87.5%
FTE 1,351 1,554 1,351 1,554
For the three months ended For the twelve months ended
(1) Excludes impact of income tax reform-related benefit and restructuring-related expenses, net of tax. See appendix for
reconciliation of non-GAAP financial measures.
Mortgage Banking Segment – Quarter Trend
28
($ in thousands)
Dec. 31,
2017
Sept. 30,
2017
Jun. 30,
2017
Mar. 31,
2017
Dec. 31,
2016
Net interest income $ 5,203 $ 5,526 $ 4,420 $ 4,747 $ 7,437
Noninterest income 60,104 71,922 72,732 65,036 60,134
Noninterest expense 68,122 77,537 74,613 70,404 82,057
Net income (loss) before taxes (2,815) (89) 2,539 (621) (14,486)
Income taxes (28,369) 34 776 (312) (4,734)
Net income (loss) $ 25,554 $ (123) $ 1,763 $ (309) $ (9,752)
Core net income (loss) (1) $ (2,101) $ 2,397 $ 1,830 $ (309) $ (9,752)
Core ROAA (1) (0.84)% 0.92% 0.83% (0.14)% (3.55)%
Core ROATE (1) (5.88)% 6.82% 5.52% (0.90)% (31.91)%
Core efficiency ratio (1) 104.7% 95.1% 96.6% 100.9% 121.4%
FTE 1,351 1,392 1,487 1,558 1,554
For the three months ended
(1) Excludes impact of income tax reform-related benefit and restructuring-related expenses, net of tax. See appendix for
reconciliation of non-GAAP financial measures.
Mortgage Origination
(1) Represents combined value of secondary market gains and originated mortgage servicing rights stated as a
percentage of interest rate lock commitments.
(2) Loan origination and funding fees stated as a percentage of mortgage originations from the retail channel and
excludes loans purchased from WMS.
29
Q416 Q117 Q217 Q317 Q417
Secondary gains/rate locks (1) 299 312 294 303 290
Loan fees/closed loans (2) 35 37 37 39 39
Composite Margin 334 349 331 342 329
Q416 Q117 Q217 Q317 Q417
HMST $2,377 $1,544 $1,866 $1,863 $1,753
WMS $138 $77 $145 $172 $134
Closed Loans $2,515 $1,621 $2,011 $2,035 $1,887
Purchase % 57% 67% 78% 77% 68%
Refinance % 43% 33% 22% 23% 32%
Rate locks $1,766 $1,623 $1,950 $1,873 $1,535
Purchase % 63% 73% 77% 71% 68%
Refinance % 37% 27% 23% 29% 32%
Mortgage Servicing
As of December 31, 2017
• Constant Prepayment Rate (CPR) – 13.5% for Q4 2017
• W.A. servicing fee – 28.2 bps
• MSRs represent 1.14% of ending UPB – 4.05 W.A. servicing fee multiple
• W.A age – 29.2 months
• W.A. expected life – 70.9 months as of 12/31/17
• Composition of government – 24.4%
• Total delinquency – 1.4% (including foreclosures)
• W.A. note rate – 4.00%
30
$19,488 $20,303
$21,105 $21,892
$22,631
4.08 4.11
3.97 3.96
4.05
2.50
2.70
2.90
3.10
3.30
3.50
3.70
3.90
4.10
4.30
4.50
$4,000
$6,000
$8,000
$10,000
$12,000
$14,000
$16,000
$18,000
$20,000
$22,000
$24,000
Q416 Q117 Q217 Q317 Q417
Mortgage Servicing Portfolio
($ in millions)
Mortgage Servicing Portfolio ($ in millions) W.A. Servicing Fee Multiple
Mortgage Market & Competitive Landscape
31
Mortgage Market
• Despite the recent increase in mortgage rates, rates remain historically low on an absolute basis
• The most recent Mortgage Bankers Association monthly forecast projects total loan originations to decrease 5.91% in
2018 over last year, and then increase 2.24% in 2019.
• Low rates should continue to support housing affordability. Nationally, purchases are expected to increase by 6.58%
from 2017 and comprise 74% of volume in 2018.
• Purchases comprised 63% of originations nationally and 54% in the Pacific Northwest in the fourth quarter. HomeStreet
continues to perform above the national and regional averages, with purchases accounting for 68% of our closed loans
and interest rate lock commitments in the quarter.
Competitive Landscape
• HomeStreet maintained its position as the number one loan originator by volume of purchase mortgages in the Puget
Sound region, and increased market share to number one for total originations in the same areas.
• Purchase demand continues to remain strong in many of our markets, however limited inventory continues to be a
significant constraining issue. Months supply of inventory and time on the market are both down significantly in most of
our major markets.
• New home construction in our markets is constrained by the geography of the West Coast and the lingering effects of the
last recession.
Outlook
32
Outlook
33
The information in this presentation, particularly including but not limited to that presented on this slide, is forward-looking in nature, and you should review Item 1A, “Risk
Factors,” in our most recent Annual Report on Form 10-K for a list of factors that may cause us to deviate from our plans or to fall short of our expectations.
(1) Subject to seasonality and cyclicality in single family closed loan volume
• Locations in the high-growth markets of the Western United States and Hawaii
• Above average loan growth while containing credit risk
• Grow core, relationship-based deposits
• Optimizing existing investment in Mortgage Banking segment
Metric 1Q18 2Q18 2018
Mortgage loan locks and forward sale commitments $1.7B $2.1B $7.2B
Mortgage loan held for sale closing volume $1.5B $2.1B $7.4B
Mortgage banking gain on sale composite margin 315‐325 bps 315‐325 bps 315‐325 bps
Average quarterly net loan portfolio growth 2% ‐ 4% 2% ‐ 4% 2% ‐ 4%
Net interest margin 3.25% ‐ 3.35% 3.25% ‐ 3.35% 3.30% ‐ 3.40%
Average noninterest expense growth (1) (1%) 5% ‐ 8% 1.0%
Key Drivers Guidance
Revenue Growth Outpacing Expense Growth, Driving Operating Efficiencies and
Strong Returns
.
Appendix
34
Statements of Financial Condition
35
($ in thousands) Dec. 31, 2017 Sept. 30, 2017 Jun. 30, 2017 Mar. 31, 2017 Dec. 31, 2016
Cash and cash equivalents $ 72,718 $ 55,050 $ 54,447 $ 61,492 $ 53,932
Investment securities 904,304 919,459 936,522 1,185,654 1,043,851
Loans held for sale 610,902 851,126 784,556 537,959 714,559
Loans held for investment, net 4,506,466 4,313,225 4,156,424 3,957,959 3,819,027
Mortgage servicing rights 284,653 268,072 258,222 257,421 245,860
Other real estate owned 664 3,704 4,597 5,646 5,243
Federal Home Loan Bank stock, at cost 46,639 52,486 41,769 41,656 40,347
Premises and equipment, net 104,654 104,389 101,797 97,349 77,636
Goodwill 22,564 22,564 22,175 22,175 22,175
Other assets 188,477 206,271 226,048 233,832 221,070
Total assets $ 6,742,041 $ 6,796,346 $ 6,586,557 $ 6,401,143 $ 6,243,700
Deposits $ 4,760,952 $ 4,670,486 $ 4,747,771 $ 4,595,809 $ 4,429,701
Federal Home Loan Bank advances 979,201 1,135,245 867,290 862,335 868,379
Accounts payable and other liabilities 172,234 193,866 190,421 176,891 191,189
Long-term debt 125,274 125,280 125,234 125,189 125,147
Total liabilities 6,037,661 6,124,877 5,930,716 5,760,224 5,614,416
Preferred stock - - - - -
Common stock 511 511 511 511 511
Additional paid-in capital 339,009 338,283 337,515 336,875 336,149
Retained earnings 371,982 337,067 323,228 312,019 303,036
Accumulated other comprehensive income (loss) (7,122) (4,392) (5,413) (8,486) (10,412)
Total shareholders’ equity 704,380 671,469 655,841 640,919 629,284
Total liabilities and shareholders’ equity $ 6,742,041 $ 6,796,346 $ 6,586,557 $ 6,401,143 $ 6,243,700
Results of Operations – Quarter Trend
For the three months ended
(1) Excludes impact of income tax reform-related benefit and restructuring and acquisition-related expenses, net of tax. See appendix for reconciliation
of non-GAAP financial measures.
(2) See appendix for reconciliation of non-GAAP financial measures.
For the nine months ended
36
($ in thousands) Dec. 31, 2017 S pt. 30, 2017 Jun. 30, 2017 Mar. 31, 2017 Dec. 31, 2016
Net interest income $ 51,079 $ 50,840 $ 46,868 $ 45,651 $ 48,074
Provision for credit losses - 250 500 - 350
Noninterest income 72,801 83,884 81,008 74,461 73,221
Noninterest expense 106,838 114,697 111,244 106,874 117,539
Net income before taxes 17,042 19,777 16,132 13,238 3,406
Income taxes (17,873) 5,938 4,923 4,255 1,112
Net income $ 34,915 $ 13,839 $ 11,209 $ 8,983 $ 2,294
Diluted EPS $ 1.29 $ 0.51 $ 0.41 $ 0.33 $ 0.09
Core net income (1) $ 11,467 $ 16,588 $ 11,391 $ 8,983 $ 2,555
Core EPS (1) $ 0.42 $ 0.61 $ 0.42 $ 0.33 $ 0.10
Tangible BV/share (2) $ 25.09 $ 23.86 $ 23.30 $ 22.73 $ 22.33
Core ROAA (1) 0.67% 0.99% 0.71% 0.57% 0.16%
Core ROAE (1) 6.54% 9.71% 6.82% 5.53% 1.67%
Core ROATE (1) 6.83% 10.15% 7.14% 5.81% 1.74%
Net Interest Margin 3.33% 3.40% 3.29% 3.23% 3.42%
Core efficiency ratio (1) 86.4% 82.0% 86.8% 89.0% 96.6%
Tier 1 Leverage Ratio (Bank) 9.67% 9.86% 10.13% 9.98% 10.26%
Total Risk-Based Capital (Bank) 14.07% 13.65% 14.01% 14.02% 14.69%
For the three months ended
Segment Core Earnings Contribution
37
(1) Excludes impact of income tax reform-related (benefit ) expense and restructuring and acquisition-related expenses, net of tax.
($ in thousands) Dec. 31,
2012
Dec. 31,
2013
Dec. 31,
2014
Dec. 31,
2015
Dec. 31,
2016
Dec. 31,
2017
1/1/12 -
12/31/17
Commercial & Consumer Banking
Core net income (loss) (1) $ (14,494) $ 8,930 $ 16,734 $ 21,035 $ 35,438 $ 46,612 $ 114,256
Core ROATE (1) (6.70)% 4.03% 7.78% 7.11% 8.14% 9.63% 5.00%
Core ROAA (1) (0.67)% 0.40% 0.65% 0.59% 0.74% 0.82% 0.42%
Core efficiency ratio (1) 107.7% 82.9% 76.3% 74.9% 69.2% 68.4% 79.9%
Mortgage Banking
Core net income (1) $ 96,620 $ 17,836 $ 7,510 $ 23,302 $ 27,351 $ 1,817 $ 174,436
Core ROATE (1) 173.83% 28.36% 10.00% 18.81% 26.78% 1.37% 43.19%
Core ROAA (1) 18.98% 2.84% 1.18% 2.36% 2.79% 0.20% 4.72%
Core efficiency ratio (1) 50.1% 85.6% 93.8% 87.1% 87.5% 99.1% 83.9%
HomeStreet Consolidated
Core net income (1) $ 82,126 $ 26,766 $ 24,245 $ 44,337 $ 62,789 $ 48,429 $ 288,692
Core ROATE (1) 38.86% 10.86% 8.81% 10.50% 11.68% 7.50% 14.70%
Core ROAA (1) 3.42% 0.98% 0.76% 0.97% 1.09% 0.73% 1.33%
Core efficiency ratio (1) 61.5% 84.8% 87.6% 83.0% 81.1% 85.9% 80.6%
For the twelve months ended
Aggregate
Earnings & Avg.
Returns
Stock Price Performance Since IPO
38
‐50%
0%
50%
100%
150%
200%
250%
HomeStreet, Inc. KBW Nasdaq Regional Bank Index
1 Year Ending 3 Year Ending 5 Year Ending Since IPO Ending
12/29/2017 12/29/2017 12/29/2017 2/10/12 ‐ 12/29/17
HomeStreet, Inc. ‐8.5% 67.4% 10.7% 163.2%
KBW Nasdaq Regional Bank Index ‐0.4% 41.5% 93.8% 107.3%
9/29/2017 9/29/2017 9/29/2017 9/29/2017
HomeStreet, Inc. 6.6% 18.0% 43.0% 145.5%
KBW Nasdaq Regional Bank Index 27.3% 34.3% 92.3% 103.9%
6/30/2017 6/30/2017 6/30/2017 6/30/2017
HomeStreet, Inc. 39.4% 19.2% 72.2% 151.6%
KBW Nasdaq Regional Bank Index 35.2% 20.2% 91.4% 99.3%
3/31/2017 3/31/2017 3/31/2017 3/31/2017
HomeStreet, Inc. 31.3% 50.1% 99.9% 154.1%
KBW Nasdaq Regional Bank Index 37.6% 33.8% 85.7% 99.5%
Non‐GAAP Financial Measures
Tangible Book Value:
39
Dec. 31, Sept. 30, Jun. 30, Mar. 31, Dec. 31, Dec. 31, Dec. 31,
(dollars in thousands, except share data) 2017 2017 2017 2017 2016 2017 2016
Shareholders' equity $704,380 $671,469 $655,841 $640,919 $629,284 $704,380 $629,284
Less: Goodwill and other intangibles (29,661) (29,893) (29,783) (30,275) (30,789) (29,661) (30,789)
Tangible shareholders' equity $674,719 $641,576 $626,058 $610,644 $598,495 $674,719 $598,495
Common shares outstanding 26,888,288 26,884,402 26,874,871 26,862,744 26,800,183 26,888,288 26,800,183
Book value per share $26.20 $24.98 $24.40 $23.86 $23.48 $26.20 $23.48
Impact of goodwill and other intangibles (1.11) (1.12) (1.10) (1.13) (1.15) (1.11) (1.15)
Tangible book value per share $25.09 $23.86 $23.30 $22.73 $22.33 $25.09 $22.33
Average shareholders' equity $701,849 $683,186 $668,377 $649,439 $616,497 $675,877 $566,148
Less: Average goodwill and other intangibles (29,898) (29,722) (30,104) (30,611) (29,943) (30,081) (28,580)
Average tangible shareholders' equity $671,951 $653,464 $638,273 $618,828 $586,554 $645,796 $537,568
Return on average shareholders’ equity 19.90% 8.10% 6.71% 5.53% 1.49% 10.20% 10.27%
Impact of goodwill and other intangibles 0.88% 0.37% 0.31% 0.28% 0.07% 0.48% 0.55%
Return on average tangible shareholders' equity 20.78% 8.47% 7.02% 5.81% 1.56% 10.68% 10.82%
Quarter Ended Twelve Months Ended
Non‐GAAP Financial Measures
Core Net Income:
40
Dec. 31, Sept. 30, Jun. 30, Mar. 31, Dec. 31, Dec. 31, Dec. 31,
(dollars in thousands) 2017 2017 2017 2017 2016 2017 2016
Net income $34,915 $13,839 $11,209 $8,983 $2,294 $68,946 $58,151
Impact of income tax reform-related benefit (23,326) - - - - (23,326) -
Impact of restructuring-related items (net of tax) (169) 2,520 67 - - 2,418 -
Impact of acquisition-related items (net of tax) 47 229 115 - 261 391 4,638
Net income, excluding income tax reform-related benefit,
restructuring (net of tax) and acquisition-related items (net of tax) $11,467 $16,588 $11,391 $8,983 $2,555 $48,429 $62,789
Noninterest expense $106,838 $114,697 $111,244 $106,874 $117,539 $439,653 $444,322
Impact of restructuring-related expenses 260 (3,877) (103) - - (3,720) -
Impact of acquisition-related expenses (72) (353) (177) - (401) (602) (7,136)
Noninterest expense, excluding restructuring and acquisition-
related expenses $107,026 $110,467 $110,964 $106,874 $117,138 $435,331 $437,186
Diluted earnings per common share $1.29 $0.51 $0.41 $0.33 $0.09 $2.54 $2.34
Impact of income tax reform-related benefit (0.86) - - - - (0.86) -
Impact of restructuring-related items (net of tax) (0.01) 0.09 - - - 0.09 -
Impact of acquisition-related items (net of tax) - 0.01 0.01 - 0.01 0.02 0.19
Diluted earnings per common share, excluding income tax reform-
related benefit, restructuring (net of tax) and acquisition-related
items (net of tax) $0.42 $0.61 $0.42 $0.33 $0.10 $1.79 $2.53
Return on average assets 2.03% 0.83% 0.70% 0.57% 0.15% 1.05% 1.01%
Impact of income tax reform-related benefit (1.35)% 0.00% 0.00% 0.00% 0.00% (0.35)% 0.00%
Impact of restructuring-related items (net of tax) (0.01)% 0.15% 0.00% 0.00% 0.00% 0.04% 0.00%
Impact of acquisition-related items (net of tax) 0.00% 0.01% 0.01% 0.00% 0.01% (0.01)% 0.08%
Return on average assets, excluding income tax reform-related
benefit, restructuring (net of tax) and acquisition-related items (net
of tax)
0.67% 0.99% 0.71% 0.57% 0.16% 0.73% 1.09%
Twelve Months EndedQuarter Ended
Non‐GAAP Financial Measures
Core Net Income (continued):
41
Dec. 31, Sept. 30, Jun. 30, Mar. 31, Dec. 31, Dec. 31, Dec. 31,
(dollars in thousands) 2017 2017 2017 2017 2016 2017 2016
Return on average shareholders' equity 19.90% 8.10% 6.71% 5.53% 1.49% 10.20% 10.27%
Impact of income tax reform-related benefit (13.29)% 0.00% 0.00% 0.00% 0.00% (3.45)% 0.00%
Impact of restructuring-related items (net of tax) (0.10)% 1.49% 0.04% 0.00% 0.00% 0.36% 0.00%
Impact of acquisition-related items (net of tax) 0.03% 0.12% 0.07% 0.00% 0.18% 0.06% 0.82%
Return on average shareholders' equity, excluding income tax
reform-related benefit, restructuring (net of tax) and acquisition-
related items (net of tax)
6.54% 9.71% 6.82% 5.53% 1.67% 7.17% 11.09%
Return on average tangible shareholders' equity 20.78% 8.47% 7.02% 5.81% 1.56% 10.68% 10.82%
Impact of income tax reform-related benefit (13.89)% 0.00% 0.00% 0.00% 0.00% (3.61)% 0.00%
Impact of restructuring-related items (net of tax) (0.10)% 1.54% 0.05% 0.00% 0.00% 0.37% 0.00%
Impact of acquisition-related items (net of tax) 0.04% 0.14% 0.07% 0.00% 0.18% 0.06% 0.86%
Return on average tangible shareholders' equity, excluding income
tax reform-related benefit, restructuring (net of tax) and acquisition-
related items (net of tax)
6.83% 10.15% 7.14% 5.81% 1.74% 7.50% 11.68%
Efficiency ratio 86.24% 85.13% 86.99% 88.98% 96.90% 86.79% 82.40%
Impact of restructuring-related items 0.21% (2.87)% (0.08)% 0.00% 0.00% (0.73)% 0.00%
Impact of acquisition-related items (0.06)% (0.26)% (0.14)% 0.00% (0.33)% (0.13)% (1.32)%
Efficiency ratio, excluding restructuring and acquisition-related
items
86.39% 82.00% 86.77% 88.98% 96.57% 85.93% 81.08%
Quarter Ended Twelve Months Ended
Non‐GAAP Financial Measures
Core Net Income – Commercial & Consumer Banking:
42
Dec. 31, Sept. 30, Jun. 30, Mar. 31, Dec. 31, Dec. 31, Dec. 31,
(dollars in thousands) 2017 2017 2017 2017 2016 2017 2016
Commercial and Consumer Banking Segment:
Net income $9,361 $13,962 $9,446 $9,292 $12,046 $42,061 $30,800
Impact of income tax reform-related expense 4,160 - - - - 4,160 -
Impact of acquisition-related items (net of tax) 47 229 115 - 261 391 4,638
Net income, excluding income tax reform-related expense and
acquisition-related items (net of tax) $13,568 $14,191 $9,561 $9,292 $12,307 $46,612 $35,438
ROAA 0.63% 0.98% 0.69% 0.69% 0.93% 0.74% 0.64%
Impact of income tax reform-related expense 0.28% 0.00% 0.00% 0.00% 0.00% 0.07% 0.00%
Impact of acquisition-related items (net of tax) 0.00% 0.02% 0.00% 0.00% 0.02% 0.01% 0.10%
ROAA, excluding income tax reform-related expense and
acquisition-related items (net of tax)
0.91% 1.00% 0.69% 0.69% 0.95% 0.82% 0.74%
ROAE 6.59% 10.19% 7.08% 7.38% 9.68% 7.81% 6.64%
Impact of income tax reform-related expense 2.93% 0.00% 0.00% 0.00% 0.00% 0.77% 0.00%
Impact of acquisition-related items (net of tax) 0.03% 0.16% 0.08% 0.00% 0.21% 0.07% 1.00%
ROAE, excluding income tax reform-related expense and
acquisition-related items (net of tax)
9.55% 10.35% 7.16% 7.38% 9.89% 8.65% 7.64%
ROATE 6.96% 10.76% 7.50% 7.85% 10.31% 8.27% 7.08%
Impact of income tax reform-related expense 3.09% 0.00% 0.00% 0.00% 0.00% 0.82% 0.00%
Impact of acquisition-related items (net of tax) 0.03% 0.18% 0.09% 0.00% 0.23% 0.07% 1.06%
ROATE, excluding income tax reform-related expense and
acquisition-related items (net of tax)
10.08% 10.94% 7.59% 7.85% 10.54% 9.16% 8.14%
Efficiency ratio 66.10% 64.88% 72.22% 72.46% 66.04% 68.68% 72.95%
Impact of acquisition-related items (net of tax) (0.12)% (0.62)% (0.35)% 0.00% (0.74)% (0.27)% (3.76)%
Efficiency ratio, excluding acquisition-related items (net of tax) 65.98% 64.26% 71.87% 72.46% 65.30% 68.41% 69.19%
Twelve Months EndedQuarter Ended
Non‐GAAP Financial Measures
Core Net Income – Mortgage Banking:
43
Dec. 31, Sept. 30, Jun. 30, Mar. 31, Dec. 31, Dec. 31, Dec. 31,
(dollars in thousands) 2017 2017 2017 2017 2016 2017 2016
Mortgage Banking Segment:
Net income $25,554 ($123) $1,763 ($309) ($9,752) $26,885 $27,351
Impact of income tax reform-related benefit (27,486) - - - - (27,486) -
Impact of restructuring-related items (net of tax) (169) 2,520 67 - - 2,418 -
Net income, excluding income tax reform-related tax benefit and
restructuring-related expenses (net of tax) ($2,101) $2,397 $1,830 ($309) ($9,752) $1,817 $27,351
ROAA 10.22% (0.05)% 0.80% (0.14)% (3.55)% 2.91% 2.79%
Impact of income tax reform-related benefit (11.00)% 0.00% 0.00% 0.00% 0.00% (2.97)% 0.00%
Impact of restructuring-related items (net of tax) (0.07)% 0.96% 0.03% 0.00% 0.00% 0.26% 0.00%
ROAA, excluding income tax reform-related tax benefit and
restructuring-related expenses (net of tax)
(0.84)% 0.92% 0.83% (0.14)% (3.55)% 0.20% 2.79%
ROATE 71.46% (0.35)% 5.32% (0.90)% (31.91)% 19.45% 26.78%
Impact of income tax reform-related benefit (76.87)% 0.00% 0.00% 0.00% 0.00% (19.89)% 0.00%
Impact of restructuring-related items (net of tax) (0.47)% 7.17% 0.20% 0.00% 0.00% 1.75% 0.00%
ROATE, excluding income tax reform-related tax benefit and
restructuring-related expenses (net of tax)
(5.88)% 6.82% 5.52% (0.90)% (31.91)% 1.31% 26.78%
Efficiency ratio 104.31% 100.11% 96.71% 100.89% 121.44% 100.34% 87.54%
Impact of restructuring-related items 0.40% (5.00)% (0.13)% 0.00% 0.00% (1.28)% 0.00%
Efficiency ratio, excluding restructuring-related expenses (net of
tax)
104.71% 95.11% 96.58% 100.89% 121.44% 99.06% 87.54%
Quarter Ended Twelve Months Ended
