NEWS RELEASE

For Immediate Release

April 17, 2019

For Further Information Contact:

Charles R. Hageboeck, Chief Executive Officer and President

(304) 769-1102

City Holding Company Announces First Quarter Results

Charleston, West Virginia - City Holding Company (“Company” or “City”) (NASDAQ:CHCO), a $4.9 billion bank holding company headquartered in Charleston, West Virginia, today announced quarterly net income of $21.6 million and diluted earnings of $1.30 per share for the quarter ended March 31, 2019. For the first quarter of 2019, the Company achieved a return on assets of 1.76% and a return on tangible equity of 17.7%. In addition, reported net interest income increased $7.4 million (22.7%) from the quarter ended March 31, 2018, while net interest income exclusive of accretion from fair value adjustments from acquisitions increased $7.2 million (22.2%) from the quarter ended March 31, 2018.

Net Interest Income

The Company’s net interest income increased from $36.4 million during the fourth quarter of 2018 to $40.1 million during the first quarter of 2019. During the first quarter of 2019, the Company’s tax equivalent net interest income increased $3.6 million, or 10.0%, from $36.6 million for the fourth quarter of 2018 to $40.3 million for the first quarter of 2019. The acquisitions of Poage and Farmers Deposit accounted for $3.0 million of this increase. In addition, higher loan yields (22 basis points) increased net interest income by $1.1 million while higher average loan balances ($59.1 million) increased net interest income by $0.6 million. These increases were partially offset by an increase in rates paid on deposits ($0.5 million) and decreased income from deposits in depository institutions ($0.4 million). The Company’s reported net interest margin increased from 3.55% for the fourth quarter of 2018 to 3.66% for the first quarter of 2019. Excluding the favorable impact of the accretion from fair value adjustments, the net interest margin would have been 3.61% for the quarter ended March 31, 2019 and 3.50% for the quarter ended December 31, 2018.

Credit Quality

The Company’s ratio of nonperforming assets to total loans and other real estate owned improved from 0.54% at December 31, 2018 to 0.43% at March 31, 2019. Total nonperforming assets decreased from $19.4 million at December 31, 2018 to $15.4 million at March 31, 2019. Excluded from this ratio are purchased credit-impaired loans for which the Company estimated cash flows and estimated a credit mark. Such loans would be considered nonperforming loans if the loan’s performance deteriorates below the Company’s initial

expectations. Total past due loans decreased from $13.1 million, or 0.37% of total loans outstanding, at December 31, 2018 to $11.0 million, or 0.31% of total loans outstanding, at March 31, 2019.

As a result of the Company’s quarterly analysis of the adequacy of the allowance for loan losses (“ALLL”), the Company recorded a recovery of loan loss provision of $0.8 million in the first quarter of 2019, compared to a provision for loan loss provision of $0.2 million for the comparable period in 2018 and a recovery of loan loss provision of $0.4 million for the fourth quarter of 2018. The recovery of loan loss provision recorded in the first quarter of 2019 reflects a general improvement in the Company’s historical loss rates used to compute the allowance not specifically allocated to individual credits and a modest decline in loans outstanding from December 31, 2018. Changes in the amount of the provision and related allowance are based on the Company’s detailed systematic methodology and are directionally consistent with changes in the composition and quality of the Company’s loan portfolio. The Company believes its methodology for determining the adequacy of its ALLL adequately provides for probable losses inherent in the loan portfolio and produces a provision and allowance for loan losses that is directionally consistent with changes in asset quality and loss experience.

Non-interest Income

Non-interest income was $15.9 million for the first quarter of 2019 as compared to $14.5 million for the first quarter of 2018. During the first quarter of 2019, the Company realized a security gain of $0.1 million due to the call of a security and $0.1 million of unrealized fair value gains on the Company’s equity securities compared to $0.3 million of unrealized fair value gains on the Company’s equity securities in the first quarter of 2018. The Company’s portfolio of equity securities is comprised primarily of equity investments in community bank holding companies and perpetual preferred securities of national bank holding companies. As of April 17, 2019, the Company’s portfolio of community bank holding company equities consists primarily of the following: First National Corporation (FXNC) (4.0% ownership); Eagle Financial Services, Inc. (EFSI) (1.5% ownership); Summit Financial Corporation (SMMF) (<1% ownership); Potomac Bancshares, Inc. (PTBS) (<1% ownership). Exclusive of these gains, non-interest income increased from $14.2 million for the first quarter of 2018 to $15.8 million for the first quarter of 2019. This increase was largely attributable to an increase of $0.6 million, or 14.7%, in bankcard revenues and an increase of $0.5 million, or 6.7%, in service charges, with $0.4 million and $0.3 million, respectively, attributable to the acquisitions of Poage and Farmers Deposit. In addition, bank owned life insurance revenues increased $0.2 million due to death benefit proceeds received in the first quarter of 2019 and other income increased $0.2 million.

Non-interest Expenses

During the quarter ended March 31, 2019, the Company incurred an additional $0.3 million of acquisition and integration expenses associated with the acquisitions of Poage and Farmers Deposit. Excluding this expense, non-interest expenses increased $4.2 million (16.9% increase), from $24.9 million in the first quarter of 2018 to $29.2 million in the first quarter of 2019. This increase was primarily due to an increase in salaries and employee benefits of $2.0 million due primarily to the acquisitions of Poage and Farmers Deposit ($0.9 million) and annual salary adjustments ($0.7 million). In addition, other expenses increased $1.1 million, equipment and software related expenses increased $0.4 million and occupancy related expenses increased $0.3 million. These increases were primarily attributable to the acquisitions of Poage and Farmers Deposit.

Balance Sheet Trends

Loans decreased $28.3 million (0.8%) from December 31, 2018 to $3.56 billion at March 31, 2019. Commercial real estate loans decreased $18.8 million (1.3%), residential real estate loans decreased $9.7 million (0.6%), and home equity loans decreased $1.2 million (0.8%). These decreases were partially offset by an increase in commercial and industrial loans of $3.0 million (1.1%).

Total average depository balances increased $380.0 million, or 10.5%, from the quarter ended December 31, 2018 to the quarter ended March 31, 2019. This growth was primarily attributable to deposits acquired from Poage and Farmers Deposit ($472.0 million) that were outstanding for the entire quarter ended March 31, 2019, as compared to less than one month during the quarter ended December 31, 2018. Exclusive of this contribution, average time deposit balances increased $28.5 million, and average savings deposit balances increased $15.1 million. These increases were partially offset by lower noninterest-bearing demand deposit balances of $12.6 million.

Income Tax Expense

The Company’s effective income tax rate for the first quarter of 2019 was 21.2% compared to 20.5% for the year ended December 31, 2018, and 20.0% for the quarter ended March 31, 2018.

Capitalization and Liquidity

The Company’s loan to deposit ratio was 88.0% and the loan to asset ratio was 72.4% at March 31, 2019. The Company maintained investment securities totaling 17.0% of assets as of the same date. The Company’s deposit mix is weighted heavily toward checking and saving accounts, which fund 54.1% of assets at March 31, 2019. Time deposits fund 28.1% of assets at March 31, 2019, but very few of these deposits are in accounts that have balances of more than $250,000, reflecting the core retail orientation of the Company.

The Company is also strongly capitalized. The Company’s tangible equity ratio increased from 10.0% at December 31, 2018 to 10.4% at March 31, 2019. At March 31, 2019, City National Bank’s Leverage Ratio was 9.45%, its Common Equity Tier I ratio was 13.89%, its Tier I Capital ratio was 13.89%, and its Total Risk-Based Capital ratio was 14.36%. These regulatory capital ratios are significantly above levels required to be considered “well capitalized,” which is the highest possible regulatory designation.

On March 27, 2019, the Board of Directors of the Company approved a quarterly cash dividend of $0.53 per share payable April 30, 2019, to shareholders of record as of April 15, 2019. On February 27, 2019, the Company announced that the Board of Directors authorized the Company to buy back up to 1,000,000 shares of its common stock (approximately 6% of outstanding shares) in open market transactions at prices that are accretive to the earnings per share of continuing shareholders. No time limit was placed on the duration of the share repurchase program. As part of this authorization, the Company terminated its previous repurchase program that was approved in September 2014. The Company had repurchased 888,243 shares under the 2014 program. During the quarter ended March 31, 2019, the Company repurchased 55,000 common shares at a weighted average price of $74.69. As of March 31, 2019, the Company could repurchase approximately 945,000 additional shares under the current program.

City Holding Company is the parent company of City National Bank of West Virginia. City National Bank operates 97 branches across West Virginia, Kentucky, Virginia, and Ohio.

Forward-Looking Information

This news release contains certain forward-looking statements that are included pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.  Forward-looking statements express only management’s beliefs regarding future results or events and are subject to inherent uncertainty, risks, and changes in circumstances, many of which are outside of management’s control. Uncertainty, risks, changes in circumstances and other factors could cause the Company’s actual results to differ materially from those projected in the forward-looking statements. Factors that could cause actual results to differ from those discussed in such forward-looking statements include, but are not limited to those set forth in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2018 under “ITEM 1A Risk Factors” and the following: (1) general economic conditions, especially in the communities and markets in which we conduct our business; (2) credit risk, including risk that negative credit quality trends may lead to a deterioration of asset quality, risk that our allowance for loan losses may not be sufficient to absorb actual losses in our loan portfolio, and risk from concentrations in our loan portfolio; (3) changes in the real estate market, including the value of collateral securing portions of our loan portfolio; (4) changes in the interest rate environment; (5) operational risk, including cybersecurity risk and risk of fraud, data processing system failures, and network breaches; (6) changes in technology and increased competition, including competition from non-bank financial institutions; (7) changes in consumer preferences, spending and borrowing habits, demand for our products and services, and customers’ performance and creditworthiness; (8) difficulty growing loan and deposit balances; (9) our ability to effectively execute our business plan, including with respect to future acquisitions; (10) changes in regulations, laws, taxes, government policies, monetary policies and accounting policies affecting bank holding companies and their subsidiaries; (11) deterioration in the financial condition of the U.S. banking system may impact the valuations of investments the Company has made in the securities of other financial institutions; (12) regulatory enforcement actions and adverse legal actions; (13) difficulty attracting and retaining key employees; (14) the expected cost savings and any revenue synergies from the merger of City Holding Company, City National Bank of West Virginia, Poage Bankshares, Inc., Town Square Bank, Farmers Deposit Bancorp, Inc. and Farmers Deposit Bank may not be fully realized within the expected time frames; (15) the disruption from the merger of City Holding Company, City National Bank of West Virginia, Poage Bankshares, Inc., Town Square Bank, Farmers Deposit Bancorp, Inc. and Farmers Deposit Bank may make it more difficult to maintain relationships with clients, associates, or suppliers; and (16) other economic, competitive, technological, operational, governmental, regulatory, and market factors affecting our operations.  Forward-looking statements made herein reflect management's expectations as of the date such statements are made. Such information is provided to assist stockholders and potential investors in understanding current and anticipated financial operations of the Company and is included pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances that arise after the date such statements are made. Further, the Company is required to evaluate subsequent events through the filing of its March 31, 2019 Form 10-Q. The Company will continue to evaluate the impact of any subsequent events on the preliminary March 31, 2019 results and will adjust the amounts if necessary.

CITY HOLDING COMPANY AND SUBSIDIARIES

Financial Highlights

(Unaudited)

	Three Months Ended
	March 31,			December 31,			September 30,			June 30,			March 31,
	2019			2018			2018			2018			2018
Earnings
Net Interest Income (FTE)	$	40,274		$	36,625		$	35,745		$	33,760		$	32,834
Net Income available to common shareholders	21,619			10,713			20,692			20,979			17,616
Per Share Data
Earnings per share available to common shareholders:
Basic	$	1.31		$	0.68		$	1.34		$	1.36		$	1.13
Diluted	1.30			0.68			1.33			1.35			1.13
Weighted average number of shares:
Basic	16,411			15,603			15,340			15,326			15,414
Diluted	16,429			15,618			15,358			15,345			15,436
Period-end number of shares	16,484			16,555			15,449			15,452			15,439
Cash dividends declared	$	0.53		$	0.53		$	0.53		$	0.46		$	0.46
Book value per share (period-end)	37.57			36.29			33.14			32.60			31.86
Tangible book value per share (period-end)	30.18			28.87			28.08			27.53			26.78
Market data:
High closing price	$	80.21		$	77.94		$	82.79		$	78.44		$	72.87
Low closing price	67.58			66.36			75.54			67.95			65.03
Period-end closing price	76.19			67.59			76.80			75.23			68.56
Average daily volume	54			66			54			60			56
Treasury share activity:
Treasury shares repurchased	55			69			7			10			204
Average treasury share repurchase price	$	74.69		$	72.89		$	77.18		$	69.26		$	68.50
Key Ratios (percent)
Return on average assets	1.76		%	0.96		%	1.90		%	2.00		%	1.69		%
Return on average tangible equity	17.7		%	9.6		%	18.9		%	19.9		%	16.7		%
Yield on interest earning assets	4.46		%	4.32		%	4.25		%	4.15		%	4.05		%
Cost of interest bearing liabilities	1.04		%	1.00		%	0.92		%	0.76		%	0.69		%
Net Interest Margin	3.66		%	3.55		%	3.54		%	3.52		%	3.51		%
Non-interest income as a percent of total revenue	28.3		%	28.8		%	30.7		%	31.7		%	30.7		%
Efficiency Ratio	51.2		%	47.6		%	48.3		%	50.7		%	52.7		%
Price/Earnings Ratio (a)	14.58			24.82			14.37			13.88			15.17

Capital (period-end)
Average Shareholders' Equity to Average Assets	12.49		%	12.05		%	11.81		%	11.88		%	12.05		%
Tangible equity to tangible assets	10.37		%	10.01		%	9.99		%	9.90		%	10.03		%
Consolidated City Holding Company risk based capital ratios (b):
CET I	15.55		%	15.07		%	15.94		%	15.49		%	15.08		%
Tier I	15.67		%	15.20		%	16.49		%	16.05		%	15.64		%
Total	16.13		%	15.69		%	17.08		%	16.65		%	16.31		%
Leverage	10.62		%	11.36		%	11.01		%	11.13		%	10.90		%
City National Bank risk based capital ratios (b):
CET I	13.89		%	13.05		%	14.00		%	13.26		%	12.59		%
Tier I	13.89		%	13.05		%	14.00		%	13.26		%	12.59		%
Total	14.36		%	13.55		%	14.59		%	13.87		%	13.25		%
Leverage	9.45		%	9.81		%	9.39		%	9.24		%	8.81		%
Other
Branches	97			100			87			86			86
FTE	927			939			846			849			832
Assets per FTE	$	5,305		$	5,498		$	5,226		$	5,152		$	5,048
Deposits per FTE	4,361			4,462			4,070			4,030			4,143
(a) The price/earnings ratio is computed based on annualized quarterly earnings.
(b) March 31, 2019 risk-based capital ratios are estimated.

CITY HOLDING COMPANY AND SUBSIDIARIES

Consolidated Statements of Income

(Unaudited) ($ in 000s, except per share data)

	Three Months Ended
	March 31,			December 31,			September 30,			June 30,			March 31,
	2019			2018			2018			2018			2018
Interest Income
Interest and fees on loans	$	42,279		$	37,973		$	36,872		$	34,292		$	32,918
Interest on investment securities:
Taxable	5,689			5,023			4,216			4,117			3,981
Tax-exempt	779			729			701			710			703
Interest on deposits in depository institutions	186			623			940			61			42
Total Interest Income	48,933			44,348			42,729			39,180			37,644
Interest Expense
Interest on deposits	7,767			6,656			5,497			4,918			4,326
Interest on short-term borrowings	1,052			1,061			1,435			459			460
Interest on long-term debt	48			200			239			230			211
Total Interest Expense	8,867			7,917			7,171			5,607			4,997
Net Interest Income	40,066			36,431			35,558			33,573			32,647
(Recovery of) provision for loan losses	(849		)	(400		)	(27		)	(2,064		)	181
Net Interest Income After (Recovery of) Provision for Loan Losses	40,915			36,831			35,585			35,637			32,466
Non-Interest Income
Net gains on sale of investment securities	88			—			—			—			—
Unrealized gains (losses) recognized on securities still held	75			(1,246		)	384			492			280
Service charges	7,321			7,921			7,598			7,323			6,862
Bankcard revenue	4,969			4,826			4,677			4,532			4,334
Trust and investment management fee income	1,642			1,737			1,579			1,645			1,568
Bank owned life insurance	1,016			734			813			722			821
Other income	814			734			702			897			627
Total Non-Interest Income	15,925			14,706			15,753			15,611			14,492
Non-Interest Expense
Salaries and employee benefits	15,243			14,017			13,576			13,551			13,241
Occupancy related expense	2,732			2,250			2,323			2,346			2,404
Equipment and software related expense	2,191			2,038			1,965			1,895			1,831
FDIC insurance expense	291			308			315			313			315
Advertising	869			530			808			849			787
Bankcard expenses	1,182			1,229			1,134			1,064			1,076
Postage, delivery, and statement mailings	624			527			537			515			578
Office supplies	386			313			364			329			313
Legal and professional fees	521			469			453			475			450
Telecommunications	726			401			408			441			500

Repossessed asset losses, net of expenses	216		207		156		112		370
Merger related expenses	250		13,015		242		—		—
Other expenses	4,180		2,874		2,759		3,021		3,072
Total Non-Interest Expense	29,411		38,178		25,040		24,911		24,937
Income Before Income Taxes	27,429		13,359		26,298		26,337		22,021
Income tax expense	5,810		2,646		5,606		5,358		4,405
Net Income Available to Common Shareholders	$	21,619	$	10,713	$	20,692	$	20,979	$	17,616
Distributed earnings allocated to common shareholders	$	8,661	$	8,695	$	8,109	$	7,039	$	7,023
Undistributed earnings allocated to common shareholders	12,772		1,928		12,382		13,729		10,398
Net earnings allocated to common shareholders	$	21,433	$	10,623	$	20,491	$	20,768	$	17,421
Average common shares outstanding	16,411		15,603		15,340		15,326		15,414
Shares for diluted earnings per share	16,429		15,618		15,358		15,345		15,436
Basic earnings per common share	$	1.31	$	0.68	$	1.34	$	1.36	$	1.13
Diluted earnings per common share	$	1.30	$	0.68	$	1.33	$	1.35	$	1.13

CITY HOLDING COMPANY AND SUBSIDIARIES

Consolidated Balance Sheets

($ in 000s)

	(Unaudited)						(Unaudited)			(Unaudited)			(Unaudited)
	March 31,			December 31,			September 30,			June 30,			March 31,
	2019			2018			2018			2018			2018
Assets
Cash and due from banks	$	50,522		$	55,016		$	49,806		$	43,466		$	39,340
Interest-bearing deposits in depository institutions	93,328			67,975			256,104			222,058			84,438
Cash and cash equivalents	143,850			122,991			305,910			265,524			123,778
Investment securities available-for-sale, at fair value	755,081			723,254			563,003			552,603			545,628
Investment securities held-to-maturity, at amortized cost	55,326			60,827			57,812			60,030			62,277
Other securities	26,182			28,810			28,875			28,920			22,165
Total investment securities	836,589			812,891			649,690			641,553			630,070
Gross loans	3,559,322			3,587,608			3,146,697			3,155,468			3,137,681
Allowance for loan losses	(14,646		)	(15,966		)	(16,311		)	(16,876		)	(18,381		)
Net loans	3,544,676			3,571,642			3,130,386			3,138,592			3,119,300
Bank owned life insurance	114,256			113,544			105,372			104,773			104,052
Premises and equipment, net	78,747			78,383			72,484			72,482			72,920
Accrued interest receivable	13,657			12,424			11,449			9,348			9,528
Net deferred tax assets	12,734			17,338			15,653			14,528			14,467
Intangible assets	121,790			122,848			78,215			78,342			78,468
Other assets	51,309			46,951			51,643			49,241			47,432
Total Assets	$	4,917,608		$	4,899,012		$	4,420,802		$	4,374,383		$	4,200,015
Liabilities
Deposits:
Noninterest-bearing	$	793,633		$	789,119		$	672,042		$	684,614		$	703,209
Interest-bearing:
Demand deposits	879,279			899,568			802,490			785,933			816,976
Savings deposits	988,182			934,218			821,390			817,547			816,245
Time deposits	1,381,913			1,352,654			1,147,709			1,133,684			1,110,532
Total deposits	4,043,007			3,975,559			3,443,631			3,421,778			3,446,962
Short-term borrowings
Federal Funds purchased	—			40,000			170,000			181,375			—
Customer repurchase agreements	194,683			221,911			220,124			196,635			195,375
Long-term debt	4,053			4,053			16,495			16,495			16,495
Other liabilities	56,624			56,725			58,526			54,346			49,306
Total Liabilities	4,298,367			4,298,248			3,908,776			3,870,629			3,708,138

Stockholders' Equity
Preferred stock	—			—			—			—			—
Common stock	47,619			47,619			47,619			47,619			47,619
Capital surplus	170,215			169,555			140,450			140,091			140,547
Retained earnings	498,847			485,967			484,017			471,515			457,650
Cost of common stock in treasury	(91,589		)	(87,895		)	(136,783		)	(136,520		)	(137,420		)
Accumulated other comprehensive loss:
Unrealized gain (loss) on securities available-for-sale	20			(8,611		)	(18,244		)	(13,918		)	(11,486		)
Underfunded pension liability	(5,871		)	(5,871		)	(5,033		)	(5,033		)	(5,033		)
Total Accumulated Other Comprehensive Loss	(5,851		)	(14,482		)	(23,277		)	(18,951		)	(16,519		)
Total Stockholders' Equity	619,241			600,764			512,026			503,754			491,877
Total Liabilities and Stockholders' Equity	$	4,917,608		$	4,899,012		$	4,420,802		$	4,374,383		$	4,200,015
Regulatory Capital
Total CET 1 capital	$	504,148		$	492,526		$	457,580		$	444,869		$	430,044
Total tier 1 capital	508,148			496,526			473,580			460,869			446,044
Total risk-based capital	523,053			512,801			490,307			478,255			464,936
Total risk-weighted assets	3,241,989			3,267,357			2,871,241			2,871,561			2,851,330

CITY HOLDING COMPANY AND SUBSIDIARIES

Loan Portfolio

(Unaudited) ($ in 000s)

	March 31,		December 31,		September 30,		June 30,		March 31,
	2019		2018		2018		2018		2018
Residential real estate (1)	$	1,625,647	$	1,635,338	$	1,485,823	$	1,472,916	$	1,465,215
Home equity - junior liens	152,251		153,496		143,540		139,245		138,477
Commercial and industrial	289,327		286,314		213,815		213,687		204,592
Commercial real estate (2)	1,436,190		1,454,942		1,268,052		1,294,489		1,296,304
Consumer	52,483		51,190		31,869		31,137		29,570
DDA overdrafts	3,424		6,328		3,598		3,994		3,523
Gross Loans	$	3,559,322	$	3,587,608	$	3,146,697	$	3,155,468	$	3,137,681
Construction loans included in:
(1) - Residential real estate loans	$	22,635	$	21,834	$	17,628	$	21,662	$	26,610
(2) - Commercial real estate loans	56,282		37,869		24,110		28,567		30,857

CITY HOLDING COMPANY AND SUBSIDIARIES

Asset Quality Information

(Unaudited) ($ in 000s)

	Three Months Ended
	March 31,			December 31,			September 30,			June 30,			March 31,
	2019			2018			2018			2018			2018
Allowance for Loan Losses
Balance at beginning of period	$	15,966		$	16,311		$	16,876		$	18,381		$	18,836
Charge-offs:
Commercial and industrial	—			(9		)	—			(385		)	(339		)
Commercial real estate	(45		)	(20		)	(74		)	(118		)	(157		)
Residential real estate	(328		)	(218		)	(244		)	(96		)	(124		)
Home equity	(46		)	—			(108		)	(33		)	(78		)
Consumer	(185		)	(209		)	(206		)	(255		)	(99		)
DDA overdrafts	(625		)	(725		)	(704		)	(636		)	(636		)
Total charge-offs	(1,229		)	(1,181		)	(1,336		)	(1,523		)	(1,433		)
Recoveries:
Commercial and industrial	135			528			147			1,476			2
Commercial real estate	32			194			166			149			223
Residential real estate	75			92			116			53			106
Home equity	—			—			—			—			—
Consumer	97			36			25			59			46
DDA overdrafts	419			386			344			345			420
Total recoveries	758			1,236			798			2,082			797
Net charge-offs	(471		)	55			(538		)	559			(636		)
(Recovery of) provision for loan losses	(849		)	(400		)	(27		)	(2,064		)	181
Balance at end of period	$	14,646		$	15,966		$	16,311		$	16,876		$	18,381
Loans outstanding	$	3,559,322		$	3,587,608		$	3,146,697		$	3,155,468		$	3,137,681
Allowance as a percent of loans outstanding	0.41		%	0.45		%	0.52		%	0.53		%	0.59		%
Allowance as a percent of non-performing loans	119.9		%	107.8		%	142.1		%	127.6		%	189.9		%
Average loans outstanding	$	3,576,984		$	3,252,939		$	3,149,320		$	3,138,146		$	3,133,804
Net charge-offs (annualized) as a percent of average loans outstanding	0.05		%	(0.01		)%	0.07		%	(0.07		)%	0.08		%

CITY HOLDING COMPANY AND SUBSIDIARIES

Asset Quality Information, Continued

(Unaudited) ($ in 000s)

	March 31,			December 31,			September 30,			June 30,			March 31,
	2019			2018			2018			2018			2018
Nonaccrual Loans
Residential real estate	$	3,263		$	4,275		$	3,029		$	3,783		$	3,331
Home equity	41			138			—			168			135
Commercial and industrial	1,526			1,676			818			863			1,063
Commercial real estate	7,282			8,461			7,599			7,707			5,061
Consumer	1			1			1			557			—
Total nonaccrual loans	12,113			14,551			11,447			13,078			9,590
Accruing loans past due 90 days or more	106			257			35			145			91
Total non-performing loans	12,219			14,808			11,482			13,223			9,681
Other real estate owned	3,186			4,608			4,259			3,636			3,912
Total non-performing assets	$	15,405		$	19,416		$	15,741		$	16,859		$	13,593
Non-performing assets as a percent of loans and other real estate owned	0.43		%	0.54		%	0.50		%	0.53		%	0.43		%
Past Due Loans
Residential real estate	$	7,972		$	9,991		$	4,657		$	5,998		$	5,641
Home equity	720			1,275			468			583			616
Commercial and industrial	101			497			187			624			61
Commercial real estate	1,414			585			934			402			1,520
Consumer	264			295			39			34			21
DDA overdrafts	535			488			582			525			432
Total past due loans	$	11,006		$	13,131		$	6,867		$	8,166		$	8,291
Total past due loans as a percent of loans outstanding	0.31		%	0.37		%	0.22		%	0.26		%	0.26		%
Troubled Debt Restructurings ("TDRs") (period-end)
Accruing:
Residential real estate	$	23,017		$	22,863		$	20,414		$	20,424		$	20,786
Home equity	3,013			3,025			2,941			3,156			3,015
Commercial and industrial	89			98			108			119			125
Commercial real estate	8,164			8,205			8,231			8,279			8,324
Consumer	—			—			—			—			—
Total accruing TDRs	$	34,283		$	34,191		$	31,694		$	31,978		$	32,250

Non-Accruing
Residential real estate	$	464	$	658	175		$	307	$	256
Home equity	5		5		—		40		40
Commercial and industrial	—		—		—		—		—
Commercial real estate	—		—		—		—		—
Consumer	—		—		—		—		—
Total non-accruing TDRs	$	469	$	663	$	175	$	347	$	296
Total TDRs	$	34,752	$	34,854	$	31,869	$	32,325	$	32,546

CITY HOLDING COMPANY AND SUBSIDIARIES

Consolidated Average Balance Sheets, Yields, and Rates

(Unaudited) ($ in 000s)

	Three Months Ended
	March 31, 2019							December 31, 2018							March 31, 2018
	Average					Yield/		Average					Yield/		Average					Yield/
	Balance			Interest		Rate		Balance			Interest		Rate		Balance			Interest		Rate
Assets:
Loan portfolio (1):
Residential real estate (2)	$	1,806,233		$	20,451	4.59	%	$	1,683,388		$	18,681	4.40	%	$	1,603,911		$	16,479	4.17	%
Commercial, financial, and agriculture (2)	1,715,524			20,845		4.93	%	1,526,658			18,335		4.76	%	1,496,817			15,608		4.23	%
Installment loans to individuals (2), (3)	55,227			840		6.17	%	42,893			745		6.89	%	33,076			504		6.18	%
Previously securitized loans (4)	***			144		***		***			212		***		***			327		***
Total loans	3,576,984			42,280		4.79	%	3,252,939			37,973		4.63	%	3,133,804			32,918		4.26	%
Securities:
Taxable	714,413			5,689		3.23	%	602,966			5,023		3.31	%	536,714			3,981		3.01	%
Tax-exempt (5)	102,375			986		3.91	%	92,833			922		3.94	%	91,722			890		3.94	%
Total securities	816,788			6,675		3.31	%	695,799			5,945		3.39	%	628,436			4,871		3.14	%
Deposits in depository institutions	72,723			186		1.04	%	141,246			623		1.75	%	29,648			42		0.57	%
Total interest-earning assets	4,466,495			49,141		4.46	%	4,089,984			44,541		4.32	%	3,791,888			37,831		4.05	%
Cash and due from banks	52,561							54,367							71,480
Premises and equipment, net	78,220							74,430							72,716
Goodwill and intangible assets	122,605							93,090							78,547
Other assets	195,954							181,249							167,174
Less: Allowance for loan losses	(16,182		)					(16,780		)					(19,420		)
Total assets	$	4,899,653						$	4,476,340						$	4,162,385
Liabilities:
Interest-bearing demand deposits	$	886,833		$	933	0.43	%	$	822,087		$	787	0.38	%	$	782,499		$	357	0.19	%
Savings deposits	947,337			1,066		0.46	%	846,162			802		0.38	%	801,504			341		0.17	%
Time deposits (2)	1,368,465			5,768		1.71	%	1,208,415			5,067		1.66	%	1,096,157			3,628		1.34	%
Short-term borrowings	237,616			1,052		1.80	%	263,022			1,060		1.60	%	236,605			460		0.79	%
Long-term debt	4,053			48		4.80	%	14,743			200		5.38	%	16,495			211		5.19	%
Total interest-bearing liabilities	3,444,304			8,867		1.04	%	3,154,429			7,916		1.00	%	2,933,260			4,997		0.69	%
Noninterest-bearing demand deposits	788,109							734,066							681,150
Other liabilities	55,372							48,553							46,426
Stockholders' equity	611,868							539,292							501,549
Total liabilities and
stockholders' equity	$	4,899,653						$	4,476,340						$	4,162,385
Net interest income				$	40,274						$	36,625						$	32,834
Net yield on earning assets						3.66	%						3.55	%						3.51	%
(1) For purposes of this table, non-accruing loans have been included in average balances and the following amounts (in thousands) of loan fees have been included in interest income:
Loan fees				$	96						$	221						$	118

(2) Included in the above table are the following amounts (in thousands) for the accretion of the fair value adjustments related to the Company's acquisitions:
Residential real estate	$	32		$	57	$	110
Commercial, financial, and agriculture	190			449		150
Installment loans to individuals	(6		)	2		10
Time deposits	256			—		—
	$	472		$	508	$	270
(3) Includes the Company’s consumer and DDA overdrafts loan categories.
(4) Effective January 1, 2012, the carrying value of the Company's previously securitized loans was reduced to $0.
(5) Computed on a fully federal tax-equivalent basis assuming a tax rate of approximately 21%.

CITY HOLDING COMPANY AND SUBSIDIARIES

Non-GAAP Reconciliations

(Unaudited) ($ in 000s)

	Three Months Ended
	March 31,			December 31,			September 30,			June 30,			March 31,
	2019			2018			2018			2018			2018
Net Interest Income/Margin
Net interest income ("GAAP")	$	40,066		$	36,431		$	35,558		$	33,573		$	32,647
Taxable equivalent adjustment	208			194			187			187			187
Net interest income, fully taxable equivalent	$	40,274		$	36,625		$	35,745		$	33,760		$	32,834
Average interest earning assets	$	4,466,495		$	4,089,984		$	4,005,067		$	3,800,435		$	3,791,888
Net Interest Margin	3.66		%	3.55		%	3.54		%	3.56		%	3.51		%
Accretion related to fair value adjustments	(0.05		)%	(0.05		)%	(0.03		)%	(0.04		)%	(0.03		)%
Net Interest Margin (excluding accretion)	3.61		%	3.50		%	3.51		%	3.52		%	3.48		%
Tangible Equity Ratio (period end)
Equity to assets ("GAAP")	12.59		%	12.26		%	11.58		%	11.52		%	11.71		%
Effect of goodwill and other intangibles, net	(2.22		)%	(2.26		)%	(1.59		)%	(1.61		)%	(1.68		)%
Tangible common equity to tangible assets	10.37		%	10.01		%	9.99		%	9.90		%	10.03		%
Return on tangible equity ("GAAP")	17.67		%	9.6		%	18.92		%	19.94		%	16.66		%
Impact of merger related expenses	0.16		%	9.23		%	0.29		%	—		%	—		%
Return on tangible equity, excluding merger related expenses	17.84		%	18.83		%	19.21		%	19.94		%	16.66		%
Return on assets ("GAAP")	1.76		%	0.96		%	1.90		%	2.00		%	1.69		%
Impact of merger related expenses	0.02		%	0.92		%	0.02		%	—		%	—		%
Return on Assets, excluding merger related expenses	1.78		%	1.88		%	1.92		%	2.00		%	1.69		%
Effective Income Tax Rate
Effective tax rate ("GAAP")	21.20		%	19.80		%	21.30		%	20.30		%	20.00		%
Impact of FIN 48 adjustments	—		%	2.97		%	—		%	—		%	—		%
Effective tax rate, excluding FIN 48 adjustments	21.20		%	22.80		%	21.30		%	20.30		%	20.00		%