Defined Benefit Pension Plan— The Wesbanco, Inc. Defined Benefit Pension Plan (“the Plan”) established on January 1, 1985, is a non-contributory, defined benefit pension plan. The Plan covers all employees of Wesbanco and its subsidiaries who were hired on or before August 1, 2007 who satisfy minimum age and length of service requirements. Benefits of the Plan are generally based on years of service and the employee’s compensation during the last five years of employment. Contributions are intended to provide not only for benefits attributed to service to date, but also for those expected to be earned in the future. Wesbanco uses a December 31 measurement date for the Plan.

	December 31,
(dollars in thousands)	2019			2018
Accumulated benefit obligation at end of year	$	142,980		$	120,445
Change in projected benefit obligation:
Projected benefit obligation at beginning of year	$	128,758		$	130,307
Service cost		2,248			2,835
Interest cost		5,266			4,517
Actuarial loss (gain)		22,395			(12,458	)
Acquisition		—			8,560
Benefits paid		(4,707	)		(5,003	)
Projected benefit obligation at end of year	$	153,960		$	128,758
Change in fair value of plan assets:
Fair value of plan assets at beginning of year	$	141,108		$	142,422
Actual return on plan assets		28,319			(5,587	)
Employer contribution		3,000			2,500
Acquisition		—			6,776
Benefits paid		(4,707	)		(5,003	)
Fair value of plan assets at end of year	$	167,720		$	141,108
Amounts recognized in the statement of financial position:
Funded status	$	13,760		$	12,351
Net amounts recognized as receivable pension costs in the consolidated balance sheets	$	13,760		$	12,351
Amounts recognized in accumulated other comprehensive income consist of:
Unrecognized prior service cost	$	52		$	78
Unrecognized net loss		24,486			24,780
Net amounts recognized in accumulated other comprehensive income (before tax)	$	24,538		$	24,858
Weighted average assumptions used to determine benefit obligations:
Discount rate		3.38	%		4.48	%
Rate of compensation increase		3.53	%		3.62	%
Expected long-term return on assets		6.30	%		6.30	%

The components of and weighted-average assumptions used to determine net periodic benefit costs are as follows:

	For the Years Ended December 31,
(dollars in thousands)	2019			2018			2017
Components of net periodic benefit cost:
Service cost—benefits earned during year	$	2,248		$	2,835		$	2,578
Interest cost on projected benefit obligation		5,266			4,517			4,393
Expected return on plan assets		(8,869	)		(8,939	)		(7,647	)
Amortization of prior service cost		26			26			26
Amortization of net loss		3,240			3,053			3,221
Net periodic pension cost	$	1,911		$	1,492		$	2,571
Other changes in plan assets and benefit obligations recognized in other comprehensive income:
Net loss (gain) for period	$	2,946		$	2,068		$	(300	)
Unrecognized loss on merged plan		—			1,429			—
Amortization of prior service cost		(26	)		(26	)		(26	)
Amortization of net loss		(3,240	)		(3,053	)		(3,221	)
Total recognized in other comprehensive income	$	(320	)	$	418		$	(3,547	)
Total recognized in net periodic pension cost and other comprehensive income	$	1,591		$	1,910		$	(976	)
Weighted-average assumptions used to determine net periodic pension cost:
Discount rate		4.48	%		3.81	%		4.46	%
Rate of compensation increase		3.62	%		3.70	%		3.74	%
Expected long-term return on assets		6.30	%		6.30	%		6.30	%

The estimated net loss and prior service credit for the Plan that will be amortized from accumulated other comprehensive income into the net periodic pension cost over the next fiscal year are $3.1 million and $26 thousand, respectively. Unrecognized prior service costs and unrecognized net losses are amortized on a straight-line basis. All unrecognized net losses are being amortized over the average remaining service period of approximately 8 years.

The expected long-term rate of return for the Plan’s total assets is based on the expected return of each of the Plan asset categories, weighted based on the median of the target allocation for each class.

Pension Plan Investment Policy and Strategy— The investment policy as established by the Retirement Plans Committee, to be followed by the Trustee, which is Wesbanco’s Trust and Investment Services department, is to invest assets based on the target allocations shown in the table below. Assets are reallocated periodically by the Trustee based on the ranges set forth by the Retirement Plans Committee to meet the target allocations. The investment policy is also subject to review periodically to determine if the policy should be changed. Plan assets are to be invested with the principal objective of maximizing long-term total return without exposing Plan assets to undue risk, taking into account the Plan’s funding needs and benefit obligations. Assets are to be invested in a balanced portfolio composed primarily of equities, fixed income, alternative asset funds and cash or cash equivalent money market investments.

A maximum of 5% may be invested in any one stock. Foreign stocks may be included, either through direct investment or by the purchase of mutual funds, which invest in foreign stock. Wesbanco common stock can represent up to 5% of the total market value. Corporate bonds selected for purchase must be rated Baa1 by Moody’s or BBB+ by Standard and Poor’s or higher. No more than 5% shall be invested in bonds or notes issued by the same corporation with a maximum term of twenty years. There is no limit on the holdings of U.S. Treasury or Federal Agency Securities. At December 31, 2019 and 2018, the Plan’s equity securities included 55,300 shares of Wesbanco common stock with a fair market value of $2.1 million and $2.0 million, respectively.

The following table sets forth the Plan’s weighted-average asset allocations by asset category:

	Target
	Allocation	December 31,
	for 2019	2019			2018
Asset Category:
Equity securities	55-75%		65	%		62	%
Debt securities	25-55%		31	%		35	%
Cash and cash equivalents	0-5%		4	%		3	%
Total			100	%		100	%

The fair values of Wesbanco’s pension plan assets at December 31, 2019 and 2018, by asset category are as follows:

			December 31, 2019
			Fair Value Measurements Using:
(in thousands)	Assets at Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Defined benefit pension plan assets:
Registered investment companies	$	47,699	$	47,699	$	—	$	—
Equity securities		75,807		75,807		—		—
Corporate debt securities		16,122		—		16,122		—
Municipal obligations		3,313		—		3,313		—
Residential mortgage-backed securities and collateralized mortgage obligations of government agencies		26,320		—		26,320		—
Total defined benefit pension plan assets (1)	$	169,261	$	123,506	$	45,755	$	—

			December 31, 2018
			Fair Value Measurements Using:
(in thousands)	Assets at Fair Value		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Defined benefit pension plan assets:
Registered investment companies	$	39,021	$	39,021	$	-	$	-
Equity securities		60,127		60,127		-		-
Corporate debt securities		16,980		-		16,980		-
Municipal obligations		2,930		-		2,930		-
Residential mortgage-backed securities and collateralized mortgage obligations of government agencies		22,050		-		22,050		-
Total defined benefit pension plan assets (1)	$	141,108	$	99,148	$	41,960	$	-

Registered investment companies and equity securities: Valued at the closing price reported on the active market on which the individual securities are traded.

Corporate debt securities, municipal obligations, and U.S. government agency securities: Valued at fair value based on models that consider criteria such as dealer quotes, available trade data, issuer creditworthiness, market movements, sector news, and bond and swap yield curves.

Cash Flows— Wesbanco has no required minimum contribution to the Plan for 2020 and as of December 31, 2019. Wesbanco contributed $3.0 million, $2.5 million and $5.0 million for the years ended December 31, 2019, 2018 and 2017, respectively.

The following table presents estimated benefits to be paid in each of the next five years and in the aggregate for the five years thereafter (in thousands):

FFKT Postretirement Medical Benefit Plan— Wesbanco assumed FFKT’s postretirement medical benefit plan upon acquisition, which had a liability totaling $15.0 million at the acquisition date. The plan covers FFKT employees who were hired before January 1, 2016 and meet certain age and length of full-time service requirements. The plan was modified in August 2018, which reduced the number of eligible employees. The modification resulted in a $5.5 million unrealized gain, which was recorded in accumulated other comprehensive income, net of tax, and will be recognized over the life of the plan participants estimated to be approximately 17 years. Benefits provided under this plan are unfunded, and payments to the plan participants are made by Wesbanco.

	December 31,
(dollars in thousands)	2019			2018
Change in projected benefit obligation:
Projected benefit obligation at acquisition	$	11,514		$	9,518
Interest cost		460			138
Plan amendment		-			2,135
Actuarial loss (gain)		1,304			(151	)
Participant contributions		392			73
Benefits paid		(1,038	)		(199	)
Projected benefit obligation at end of year	$	12,632		$	11,514
Amounts recognized in the statement of financial position:
Funded status	$	(12,632	)	$	(11,514	)
Net amounts recognized as receivable pension costs in the consolidated balance sheets	$	(12,632	)	$	(11,514	)
Amounts recognized in accumulated other comprehensive income consist of:
Unrecognized net loss (gain)	$	1,153		$	(151	)
Prior service cost		(3,016	)		(3,240	)
Net amounts recognized in accumulated other comprehensive income (before tax)	$	(1,863	)	$	(3,391	)
Weighted average assumptions used to determine benefit obligations:
Discount rate		3.35	%		4.09	%
Rate of compensation increase	NA			NA
Expected long-term return on assets	NA			NA

The components of and weighted-average assumptions used to determine net periodic benefit costs are as follows:

	For the Years Ended December 31,
(dollars in thousands)	2019			2018
Components of net periodic benefit cost:
Interest cost on projected benefit obligation	$	460		$	138
Amortization of prior service cost		(224	)		(121	)
Net periodic pension cost	$	236		$	17
Other changes in plan benefit obligations recognized in other comprehensive income:
Prior service cost for period	$	-		$	2,135
Net (gain) loss for the period		1,304			(151	)
Amortization of prior service cost		224			121
Total recognized in other comprehensive income	$	1,528		$	2,105
Total recognized in net periodic pension cost and other comprehensive income	$	1,764		$	2,122
Weighted-average assumptions used to determine net periodic pension cost:
Discount rate		2.96	%		4.05	%
Rate of compensation increase	NA			NA
Expected long-term return on assets	NA			NA

The following table presents estimated benefits to be paid in each of the next five years and in aggregate for the five years thereafter (in thousands):

Employee Stock Ownership and 401(k) Plan (“KSOP”) — Wesbanco sponsors a KSOP plan consisting of a non-contributory leveraged ESOP and a contributory 401(k) profit sharing plan covering substantially all of its employees. Under the provisions of the 401(k) plan, Wesbanco matches a portion of eligible employee contributions based on rates established and approved by the Board of Directors. For each of the past three years, Wesbanco matched 100% of the first 3% and 50% of the next 2% of eligible employee contributions. No ESOP contribution has been made for any of the past three years.

As of December 31, 2019, the KSOP held 428,952 shares of Wesbanco common stock of which all shares were allocated to specific employee accounts. Dividends on shares are either distributed to employee accounts or paid in cash to the participant. Total expense for the KSOP was $4.4 million, $3.7 million and $3.3 million in 2019, 2018 and 2017, respectively. Wesbanco had 343,107 and 384,770 shares registered on Form S-8 remaining for future issuance under the KSOP plan at December 31, 2019 and 2018, respectively.

Incentive Bonus, Option and Restricted Stock Plan— The Incentive Bonus, Option and Restricted Stock Plan (the “Incentive Plan”), is a non-qualified plan that includes the following components: an Annual Bonus and a Long-Term Incentive, which included a Total Shareholder Return Plan, a Stock Option component, and a Restricted Stock component for certain key officers of the Company. The components allow for payments of cash, a mixture of cash and stock, granting of stock options, or granting of restricted stock, depending upon the component of the Incentive Plan in which the award is earned, through the attainment of certain performance goals for a time-based vesting requirements. Performance goals or service vesting requirements are established by Wesbanco’s Compensation Committee. On April 20, 2017, Wesbanco registered an additional 1,000,000 shares of Wesbanco common stock for issuance under the Incentive Plan. Wesbanco had 408,466 and 694,775 shares registered on Form S-8 remaining for future issuance under equity compensation plans at December 31, 2019 and 2018, respectively.

Compensation expense for key officers for the Annual Bonus was $2.1 million, $2.0 million and $1.8 million for 2019, 2018, and 2017, respectively.

On May 15, 2019, Wesbanco granted 129,850 stock options to selected participants, including certain named executive officers at an exercise price of $38.93 per share. The options granted in 2019 are service-based and vest in two equal installments on December 31, 2019 and December 31, 2020, and expire seven years from the date of grant.

Compensation expense for the stock option component of the Incentive Plan was $0.9 million, $0.6 million and $0.5 million for 2019, 2018 and 2017, respectively. At December 31, 2019, the total unrecognized compensation expense related to non-vested stock option grants totaled $0.4 million with an expense recognition period of one year remaining. The maximum term of options granted under Wesbanco’s stock option plan is ten years from the original grant date; however, options granted in 2019 had a term of seven years.

The total intrinsic value of options exercised was $0.1 million and $0.9 million for the years ended December 31, 2019 and 2018, respectively. The cash received and related tax benefit realized from stock options exercised was $0.2 million and $30 thousand in 2019 and was $1.8 million and $0.2 million in 2018. Shares issued in connection with options exercised are issued from treasury shares acquired under Wesbanco’s share repurchase plans or from issuance of authorized but unissued shares, subject to prior SEC registration.

The fair value of stock options granted is estimated at the date of grant using the Black-Scholes option-pricing model. This model requires the input of highly subjective assumptions, changes to which can materially affect the fair value estimate. Additionally, there may be other factors that might otherwise have a significant effect on the value of stock options granted that are not considered by the model.

The following table sets forth the significant assumptions used in calculating the fair value of the grants:

	For the Years Ended December 31,
	2019			2018			2017
Weighted-average life	5.6 years			5.2 years			5.2 years
Risk-free interest rate		2.18	%		2.95	%		1.91	%
Dividend yield		2.80	%		2.54	%		2.67	%
Volatility factor		21.97	%		21.27	%		21.47	%
Fair value of the grants	$	6.36		$	8.54		$	6.02

The weighted-average life assumption is an estimate of the length of time that an employee might hold an option before option exercise, option expiration or employment termination. The weighted-average life assumption was developed using historical experience. Wesbanco used a weighted historical volatility of its common stock price over the weighted average life prior to each issuance as the volatility factor assumption, adjusted for abnormal volatility during certain periods, and current and future dividend payment expectations for the dividend assumption.

The following table shows the activity for the Stock Option component of the Incentive Plan:

	For the Year Ended December 31, 2019
	Number of Options			Weighted Average Exercise Price Per Share
Outstanding at beginning of the year		393,625		$	37.15
Granted during the year		129,850			38.93
Assumed in acquisition		220,615			21.99
Exercised during the year		(7,375	)		21.31
Forfeited or expired during the year		(3,275	)		38.82
Outstanding at end of the year		733,440		$	33.06
Exercisable at year end		668,640		$	32.49

The aggregate intrinsic value of the outstanding shares and the shares exercisable at year-end was $4.2 million and $4.2 million, respectively.

The following table shows the average remaining life of the stock options at December 31, 2019:

Year Issued	Exercisable at Year End		Exercise Price Range Per Share		Options Outstanding		Weighted Average Exercise Price		Weighted Avg. Remaining Contractual Life in Years
2010		9,274	$	9.09		9,274	$	9.09		0.08
2011		8,296		9.97		8,296	$	9.97		1.08
2012		29,622	10.20 to 20.02			29,622	$	10.70		2.25
2013		42,608	15.35 to 25.00			42,608	$	19.80		1.98
2014		59,681	21.37 to 28.79			59,681	$	25.36		2.67
2015		84,126	18.33 to 31.58			84,126	$	26.04		3.65
2016		96,597	22.63 to 32.37			96,597	$	28.84		4.40
2017		106,175		38.88		106,175	$	38.88		4.35
2018		167,461	36.97 to 45.65			167,461	$	43.32		6.20
2019		64,800		38.93		129,600	$	38.93		6.38
Total		668,640	$ 9.09 to $45.65			733,440	$	33.06		4.59

During 2019, Wesbanco granted 145,447 shares of service-based restricted stock to certain officers and directors. Of these shares, 106,545 cliff vest 36 months from the date of grant and 38,902 shares cliff vest 24 months from the date of grant. The weighted average fair value of the restricted stock granted was $38.46 per share. The restricted stock grant provides the recipient with voting rights from the date of issuance. Dividends paid on 110,449 restricted shares during the restriction period are converted into additional shares of restricted stock on the date the cash dividend would have otherwise been paid, but do not vest until the related grant of the restricted shares complete their vesting. The Compensation Committee has discretion to elect to pay such dividends in cash to participants. Dividends are not accrued on the other 34,998 shares until the restricted stock vests. Voting rights accrue from date of issuance on 110,449 shares granted, while voting rights do not accrue until vested on 34,998 shares granted.

Wesbanco also granted 16,056 shares of performance-based restricted stock to select officers. These shares have a three-year performance period, beginning January 1, 2020, based on Wesbanco’s return on average assets and return on average tangible common equity measured for each year, compared to a national peer group of financial institutions with total assets between approximately $12.1 billion and $27.5 billion. Earned performance-based restricted shares are subject to additional service-based vesting with 50% vesting on May 16, 2023 after the completion of the three-year performance period and the final 50% vesting on May 16, 2024. For the 2017 performance-based restricted stock, the first year reporting period of 2018 achieved 100% of the performance goal. The Compensation Committee approved the goal achievement in 2019, thus Wesbanco issued 3,000 shares to the select officers, but these shares will not vest until May 16, 2021 and May 16, 2022.

Dividends accrue on the restricted shares once the performance objective is achieved and then are converted into additional shares of restricted stock on the date the cash dividend would have otherwise been paid, but do not vest until the related grant of the restricted shares complete their vesting. The Compensation Committee has discretion to elect to pay such dividends in cash to participants. Voting rights accrue upon achievement of the performance objective.

Compensation expense relating to all restricted stock was $4.2 million, $3.0 million and $2.1 million in 2019, 2018 and 2017, respectively. At December 31, 2019, the total unrecognized compensation expense related to non-vested restricted stock grants totaled $7.6 million with a weighted average expense recognition period of 1.4 years remaining.

The following table shows the activity for the Restricted Stock component of the Incentive Plan:

For the Year Ended December 31, 2019	Restricted Stock			Weighted Average Grant Date Fair Value Per Share
Non-vested at January 1, 2019		263,457		$	40.21
Granted during the year		161,503			38.51
Vested during the year		(75,646	)		34.13
Forfeited or expired during the year		(5,123	)		35.33
Dividend reinvestment		8,059			37.82
Non-vested at end of the year		352,250		$	40.75

On November 18, 2015, Wesbanco’s Compensation Committee adopted Administrative Rules for a Total Shareholder Return Plan (“TSRP”). The TSRP measures the TSR on Wesbanco common stock over a three-year measurement period relative to the return of an established peer group of publicly traded companies over the same performance period. The award is determined at the end of the three-year period if the TSR of Wesbanco common stock is equal to or greater than the 50th percentile of the TSR of the peer group. The number of shares to be earned by the participant shall be 200% of the grant-date award if the TSR of Wesbanco common stock is equal to or greater than the 75th percentile of the TSR of the peer group. Upon achieving the market-based metric, shares determined to be earned by the participant become service-based and vest in three equal annual installments. Voting rights accrue at such time as well. Wesbanco granted 12,000 TSRP shares in 2019 for the performance period beginning January 1, 2019 and ending December 31, 2021 to certain executive officers. The fair value of the market-based awards is based on a Monte-Carlo Simulation valuation of our common stock and our peers’ common stock as of the grant date.

Based on the calculation of shareholder return over the measurement period beginning January 1, 2017 and ending December 31, 2019, Wesbanco stock performance did not equal or exceed the 50th percentile when compared to peer calculations of shareholder return. Therefore, none of the 12,000 shares granted in 2017 will vest.

Compensation expense relating to the TSR plans was $0.4 million, $0.5 million, and $0.2 million in 2019, 2018 and 2017, respectively. The grant date fair value of the 2019 TSR award was $45.89 per share. At December 31, 2019, the total unrecognized compensation expense related to non-vested TSR awards totaled $0.6 million with a weighted average expense recognition period of 2.5 years remaining.