EX-99.1 2 d908589dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

 

LOGO

NEWS RELEASE

 

Investor Contact:

Brian Klaus, Senior Vice President, Director of Investor Relations

920-491-7059

 

Media Contact:

Cliff Bowers, Senior Vice President, Director of Public Relations

920-491-7542

Associated Reports First Quarter Earnings of $0.30 per share

Earnings per share up 11% from prior year

GREEN BAY, Wis. — April 16, 2015 — Associated Banc-Corp (NYSE: ASB) today reported net income to common shareholders of $45 million, or $0.30 per common share, for the quarter ended March 31, 2015. This compares to net income to common shareholders of $44 million, or $0.27 per common share, for the quarter ended March 31, 2014.

“We are pleased to report another quarter of solid results. Continued loan growth, a strong boost in insurance revenues, and a benign credit environment all helped drive this quarter’s performance,” said President and CEO Philip B. Flynn. “We remain focused on our strategies to enhance efficiency and on opportunities for disciplined capital deployment.”

HIGHLIGHTS

 

    Average loans grew $428 million or 2% from the fourth quarter

 

    Average total commercial loan balances grew $309 million, or 3% from the fourth quarter, and accounted for the majority of this quarter’s average loan growth

 

    Average deposits grew $523 million or 3% from the fourth quarter

 

    Net interest income of $168 million increased $3 million or 2% from the comparable year ago period

 

    Noninterest income of $80 million increased $10 million or 15% from the fourth quarter

 

    Insurance commissions increased $9 million from the fourth quarter

 

    Noninterest expenses of $174 million increased $2 million or 1% from the fourth quarter

 

    Pretax income of $69 million increased $2 million or 2% from the fourth quarter

 

    During the first quarter, the Company repurchased $30 million, or approximately 1.7 million shares, of common stock at an average cost of $17.27 per share

 

    Return on average Tier 1 common equity was 10.22% for the first quarter

 

    Capital ratios remain strong with a Tier 1 common equity ratio of 9.39% at March 31, 2015

 

– more –


FIRST QUARTER 2015 FINANCIAL RESULTS

Loans

Average loans of $17.8 billion increased $428 million, or 2% from the fourth quarter, and have increased $1.7 billion, or 10% from the year ago quarter. Total commercial loans grew $309 million on average from the fourth quarter and are up $1.1 billion from the prior year. Commercial and business lending average balances grew $272 million, or 4% on a linked-quarter basis. Commercial real estate lending average balances grew $37 million, or 1% from the fourth quarter. Total average consumer loans were up $119 million compared to the prior quarter as the growth in residential mortgage average balances of $174 million was partially offset by continued, but slower, run off in home equity and installment loans.

Deposits

Average deposits of $19.1 billion for the first quarter were up $523 million, or 3% compared to the fourth quarter and have increased $2.1 billion, or 12%, from the year ago quarter. Money market average balances increased $444 million, or 5% from the fourth quarter, and were up $1.5 billion, or 21% from the year ago quarter. Average checking balances have increased four consecutive quarters and were up slightly from the fourth quarter. Average time deposits increased $45 million during the quarter marking a reversal of recent trends.

Net Interest Income and Net Interest Margin

First quarter net interest income of $168 million was up $3 million, or 2% from the year ago quarter, but down $7 million from the fourth quarter. First quarter interest recoveries and prepayments were down $2 million relative to the fourth quarter. In addition, long-term funding costs increased $2 million from the fourth quarter. Lastly, the day count difference between the first and fourth quarters resulted in expected lower net interest income of approximately $2 million.

First quarter net interest margin was 2.89%, a decrease of 15 basis points from the 3.04% reported in the fourth quarter. The first quarter yield on earning assets declined 12 basis points from the prior quarter. The majority of this decline is attributed to continued loan yield compression. In addition, lower interest recoveries and prepayments accounted for 3 basis points of the decline in earning asset yields. The majority of the 4 basis point, quarter over quarter increase in total funding costs is related to the full effect of the carrying cost of the Company’s $500 million debt issued in November 2014.

Noninterest Income and Expense

Noninterest income for the first quarter was $80 million, up $10 million or 15% from the fourth quarter, and up $7 million or 9% from the year ago quarter. The Ahmann & Martin Co. acquisition closed during the first quarter and largely contributed to a $9 million increase in insurance commissions from the fourth quarter. Mortgage banking income increased $4 million from the prior quarter. First quarter net asset gains of $1 million were down $3 million from the prior quarter.

 

 

– more –


Total noninterest expense for the quarter ended March 31, 2015 was $174 million, up $2 million or 1% from the fourth quarter. Personnel expense increased $3 million from the fourth quarter, largely attributed to the Ahmann & Martin Co. acquisition which added approximately 120 colleagues. Occupancy expenses increased by $3 million from the previous quarter, primarily related to a lease termination charge, as we further consolidated office space in Chicago. Business development and advertising expenses declined $3 million from the previous quarter, predominantly related to seasonal advertising during the fourth quarter.

Taxes

First quarter income taxes were $22 million with an effective tax rate of 32%, compared to $21 million with an effective tax rate of 31% in the year ago period.

Credit

Net charge offs of $6 million for the first quarter were up $1 million from the fourth quarter, and were up slightly from the year ago quarter. Potential problem loans of $219 million increased $28 million from the prior quarter. The first quarter provision for credit losses was essentially flat from the prior quarter at $5 million.

The Company’s allowance for loan losses was $265 million, equal to 1.48% of loans and reflects a coverage ratio of 152% of nonaccrual loans at March 31, 2015.

Nonaccrual loans of $174 million were down 2% compared to both the fourth quarter and the year ago quarter. The ratio of nonaccrual loans to total loans was down from the previous quarter and stands at 0.97%.

Capital Ratios

During the first quarter, the Company repurchased $30 million of common stock in several open market transactions.

The Company’s capital position remains strong, with a Tier 1 common equity ratio of 9.39% at March 31, 2015. The Company’s capital ratios continue to be in excess of the Basel III “well-capitalized” regulatory benchmarks on a fully phased in basis.

 

– more –


FIRST QUARTER 2015 EARNINGS RELEASE CONFERENCE CALL

The Company will host a conference call for investors and analysts at 4:00 p.m. Central Time (CT) today, April 16, 2015. Interested parties can listen to the call live on the internet through the investor relations section of the company’s website, https://www.associatedbank.com/investor or by dialing 877-407-8037. The slide presentation for the call will be available on the company’s website just prior to the call. The number for international callers is 201-689-8037. Participants should ask the operator for the Associated Banc-Corp first quarter 2015 earnings call.

An audio archive of the webcast will be available on the company’s website at https://www.associatedbank.com/investor approximately fifteen minutes after the call is over.

ABOUT ASSOCIATED BANC-CORP

Associated Banc-Corp (NYSE: ASB) has total assets of $27 billion and is one of the top 50, publicly traded, U.S. bank holding companies. Headquartered in Green Bay, Wis., Associated is a leading Midwest banking franchise, offering a full range of financial products and services in over 200 banking locations serving more than 100 communities throughout Wisconsin, Illinois and Minnesota, and commercial financial services in Indiana, Michigan, Missouri, Ohio and Texas. Associated Bank, N.A. is an Equal Housing Lender, Equal Opportunity Lender and Member FDIC. More information about Associated Banc-Corp is available at www.associatedbank.com.

FORWARD LOOKING STATEMENTS

Statements made in this document which are not purely historical are forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. This includes any statements regarding management’s plans, objectives, or goals for future operations, products or services, and forecasts of its revenues, earnings, or other measures of performance. Such forward-looking statements may be identified by the use of words such as “believe”, “expect”, “anticipate”, “plan”, “estimate”, “should”, “will”, “intend”, “outlook”, or similar expressions. Forward-looking statements are based on current management expectations and, by their nature, are subject to risks and uncertainties. Actual results may differ materially from those contained in the forward-looking statements. Factors which may cause actual results to differ materially from those contained in such forward-looking statements include those identified in the Company’s most recent Form 10-K and subsequent SEC filings. Such factors are incorporated herein by reference.

NON-GAAP FINANCIAL MEASURES

This press release contains references to measures which are not defined in generally accepted accounting principles (“GAAP”), including “efficiency ratio,” “Tier 1 common equity”, and “core fee-based revenue.” Information concerning these non-GAAP financial measures can be found in the attached tables.

 

# # #


Associated Banc-Corp

Consolidated Balance Sheets (Unaudited)

 

(in thousands)

  March 31,
2015
    December 31,
2014
    Seql Qtr
$ Change
    September 30,
2014
    June 30,
2014
    March 31,
2014
    Comp Qtr
$ Change
 

Assets

             

Cash and due from banks

  $ 355,541      $ 444,113      $ (88,572   $ 381,287      $ 549,883      $ 526,951      $ (171,410

Interest-bearing deposits in other financial institutions

    488,426        571,924        (83,498     74,945        78,233        92,071        396,355   

Federal funds sold and securities purchased under agreements to resell

    3,380        16,030        (12,650     18,320        18,135        4,400        (1,020

Securities held to maturity, at amortized cost

    438,047        404,455        33,592        301,941        246,050        193,759        244,288   

Securities available for sale, at fair value

    5,358,310        5,396,812        (38,502     5,345,422        5,506,379        5,277,908        80,402   

Federal Home Loan Bank and Federal Reserve Bank stocks, at cost

    189,222        189,107        115        188,875        186,247        181,360        7,862   

Loans held for sale

    159,963        154,935        5,028        141,672        78,657        46,529        113,434   

Loans

    17,979,032        17,593,846        385,186        17,159,090        17,045,052        16,441,444        1,537,588   

Allowance for loan losses

    (265,268     (266,302     1,034        (266,262     (271,851     (267,916     2,648   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Loans, net

    17,713,764        17,327,544        386,220        16,892,828        16,773,201        16,173,528        1,540,236   

Premises and equipment, net

    274,591        274,688        (97     272,283        264,735        269,257        5,334   

Goodwill

    968,774        929,168        39,606        929,168        929,168        929,168        39,606   

Other intangible assets, net

    77,984        67,582        10,402        69,201        70,538        72,629        5,355   

Trading assets

    42,336        35,163        7,173        34,005        40,630        40,822        1,514   

Other assets

    998,402        1,010,253        (11,851     1,003,875        985,930        997,815        587   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total assets

  $ 27,068,740      $ 26,821,774      $ 246,966      $ 25,653,822      $ 25,727,786      $ 24,806,197      $ 2,262,543   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Liabilities and Stockholders’ Equity

             

Noninterest-bearing demand deposits

  $ 4,570,872      $ 4,505,272      $ 65,600      $ 4,302,454      $ 4,211,057      $ 4,478,981      $ 91,891   

Interest-bearing deposits

    15,280,720        14,258,232        1,022,488        13,898,804        13,105,202        13,030,946        2,249,774   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total deposits

    19,851,592        18,763,504        1,088,088        18,201,258        17,316,259        17,509,927        2,341,665   

Federal funds purchased and securities sold under agreements to repurchase

    587,272        493,991        93,281        765,641        959,051        939,254        (351,982

Other short-term funding

    75,265        574,297        (499,032     664,539        1,378,120        308,652        (233,387

Long-term funding

    3,429,925        3,930,117        (500,192     2,931,547        2,931,809        2,932,040        497,885   

Trading liabilities

    44,730        37,329        7,401        36,003        43,311        43,450        1,280   

Accrued expenses and other liabilities

    197,818        222,285        (24,467     185,256        169,290        171,850        25,968   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total liabilities

    24,186,602        24,021,523        165,079        22,784,244        22,797,840        21,905,173        2,281,429   

Stockholders’ Equity

             

Preferred equity

    59,727        59,727        —          61,024        61,024        61,158        (1,431

Common stock

    1,674        1,665        9        1,719        1,750        1,750        (76

Surplus

    1,505,170        1,484,933        20,237        1,583,032        1,628,356        1,623,323        (118,153

Retained earnings

    1,509,967        1,497,818        12,149        1,466,525        1,432,518        1,402,549        107,418   

Accumulated other comprehensive income (loss)

    24,800        (4,850     29,650        (1,725     10,494        (11,577     36,377   

Treasury stock

    (219,200     (239,042     19,842        (240,997     (204,196     (176,179     (43,021
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total stockholders’ equity

    2,882,138        2,800,251        81,887        2,869,578        2,929,946        2,901,024        (18,886
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Total liabilities and stockholders’ equity

  $ 27,068,740      $ 26,821,774      $ 246,966      $ 25,653,822      $ 25,727,786      $ 24,806,197      $ 2,262,543   
 

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

 

Page 1


Associated Banc-Corp

Consolidated Statements of Income (Unaudited)—Quarterly Trend

 

                Sequential Qtr                       Comparable Qtr  
(in thousands, except per share amounts)   1Q15     4Q14     $ Change     %
Change
    3Q14     2Q14     1Q14     $ Change     %
Change
 

Interest Income

                 

Interest and fees on loans

  $ 151,945      $ 156,536      $ (4,591     (2.9 )%    $ 152,030      $ 146,629      $ 143,387      $ 8,558        6.0

Interest and dividends on investment securities:

                 

Taxable

    25,092        25,061        31        0.1     25,037        26,109        26,257        (1,165     (4.4 )% 

Tax-exempt

    7,887        7,580        307        4.1     7,483        7,030        6,971        916        13.1

Other interest

    1,692        1,821        (129     (7.1 )%      1,503        1,862        1,449        243        16.8
 

 

 

   

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

 

 

   

Total interest income

    186,616        190,998        (4,382     (2.3 )%      186,053        181,630        178,064        8,552        4.8

Interest Expense

                 

Interest on deposits

    7,619        7,319        300        4.1     6,621        6,195        6,159        1,460        23.7

Interest on Federal funds purchased and securities sold under agreements to repurchase

    231        218        13        6.0     390        306        305        (74     (24.3 )% 

Interest on other short-term funding

    81        156        (75     (48.1 )%      233        280        116        (35     (30.2 )% 

Interest on long-term funding

    10,872        8,644        2,228        25.8     6,179        6,146        6,511        4,361        67.0
 

 

 

   

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

 

 

   

Total interest expense

    18,803        16,337        2,466        15.1     13,423        12,927        13,091        5,712        43.6
 

 

 

   

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

 

 

   

Net Interest Income

    167,813        174,661        (6,848     (3.9 )%      172,630        168,703        164,973        2,840        1.7

Provision for credit losses

    4,500        5,000        (500     (10.0 )%      1,000        5,000        5,000        (500     (10.0 )% 
 

 

 

   

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

 

 

   

Net interest income after provision for credit losses

    163,313        169,661        (6,348     (3.7 )%      171,630        163,703        159,973        3,340        2.1

Noninterest Income

                 

Trust service fees

    12,087        12,457        (370     (3.0 )%      12,218        12,017        11,711        376        3.2

Service charges on deposit accounts

    15,806        17,006        (1,200     (7.1 )%      17,961        17,412        16,400        (594     (3.6 )% 

Card-based and other nondeposit fees

    12,416        12,019        397        3.3     12,407        12,577        12,509        (93     (0.7 )% 

Insurance commissions

    19,728        10,593        9,135        86.2     7,860        13,651        12,317        7,411        60.2

Brokerage and annuity commissions

    3,683        3,496        187        5.3     4,040        4,520        4,033        (350     (8.7 )% 
 

 

 

   

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

 

 

   

Total core fee-based revenue

    63,720        55,571        8,149        14.7     54,486        60,177        56,970        6,750        11.8

Mortgage banking, net

    7,408        2,928        4,480        153.0     6,669        5,362        6,361        1,047        16.5

Capital market fees, net

    2,467        2,613        (146     (5.6 )%      2,939        2,099        2,322        145        6.2

Bank owned life insurance income

    2,875        2,739        136        5.0     3,506        3,011        4,320        (1,445     (33.4 )% 

Asset gains, net

    1,096        3,727        (2,631     (70.6 )%      4,934        899        728        368        50.5

Investment securities gains, net

    —          25        (25     (100.0 )%      57        34        378        (378     (100.0 )% 

Other

    2,510        2,040        470        23.0     2,317        665        2,442        68        2.8
 

 

 

   

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

 

 

   

Total noninterest income

    80,076        69,643        10,433        15.0     74,908        72,247        73,521        6,555        8.9

Noninterest Expense

                 

Personnel expense

    100,152        97,258        2,894        3.0     97,650        97,793        97,698        2,454        2.5

Occupancy

    17,683        14,589        3,094        21.2     13,743        13,785        15,560        2,123        13.6

Equipment

    5,772        6,148        (376     (6.1 )%      6,133        6,227        6,276        (504     (8.0 )% 

Technology

    15,558        14,581        977        6.7     13,573        14,594        12,724        2,834        22.3

Business development and advertising

    5,327        8,538        (3,211     (37.6 )%      7,467        5,077        5,062        265        5.2

Other intangible amortization

    801        775        26        3.4     990        991        991        (190     (19.2 )% 

Loan expense

    2,996        3,646        (650     (17.8 )%      3,813        3,620        2,787        209        7.5

Legal and professional fees

    4,538        4,257        281        6.6     4,604        4,436        4,188        350        8.4

Foreclosure / OREO expense

    1,425        1,168        257        22.0     2,083        1,575        1,896        (471     (24.8 )% 

FDIC expense

    6,500        6,956        (456     (6.6 )%      6,859        4,945        5,001        1,499        30.0

Other

    13,503        13,889        (386     (2.8 )%      14,938        14,882        15,475        (1,972     (12.7 )% 
 

 

 

   

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

 

 

   

Total noninterest expense

    174,255        171,805        2,450        1.4     171,853        167,925        167,658        6,597        3.9
 

 

 

   

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

 

 

   

Income before income taxes

    69,134        67,499        1,635        2.4     74,685        68,025        65,836        3,298        5.0

Income tax expense

    22,462        18,761        3,701        19.7     24,478        21,660        20,637        1,825        8.8
 

 

 

   

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

 

 

   

Net income

    46,672        48,738        (2,066     (4.2 )%      50,207        46,365        45,199        1,473        3.3

Preferred stock dividends

    1,228        1,225        3        0.2     1,255        1,278        1,244        (16     (1.3 )% 
 

 

 

   

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

 

 

   

Net income available to common equity

  $ 45,444      $ 47,513      $ (2,069     (4.4 )%    $ 48,952      $ 45,087      $ 43,955      $ 1,489        3.4
 

 

 

   

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

 

 

   

Earnings Per Common Share:

                 

Basic

  $ 0.30      $ 0.31      $ (0.01     (3.2 )%    $ 0.31      $ 0.28      $ 0.27      $ 0.03        11.1

Diluted

  $ 0.30      $ 0.31      $ (0.01     (3.2 )%    $ 0.31      $ 0.28      $ 0.27      $ 0.03        11.1

Average Common Shares Outstanding:

                 

Basic

    150,070        151,931        (1,861     (1.2 )%      155,925        159,940        161,467        (11,397     (7.1 )% 

Diluted

    151,164        153,083        (1,919     (1.3 )%      156,991        160,838        162,188        (11,024     (6.8 )% 

 

Page 2


Associated Banc-Corp

Selected Quarterly Information

 

($ in millions, except per share and full time equivalent employee data)    1Q15     4Q14     3Q14     2Q14     1Q14  

Per Common Share Data

          

Dividends

   $ 0.10      $ 0.10      $ 0.09      $ 0.09      $ 0.09   

Market Value:

          

High

     19.07        19.37        18.90        18.39        18.35   

Low

     16.62        16.75        17.42        16.82        15.58   

Close

     18.60        18.63        17.42        18.08        18.06   

Book value

     18.38        18.32        18.15        17.99        17.64   

Tier 1 common equity / share (1) (6)

     11.97        12.09        12.10        12.04        11.88   

Tangible book value / share

   $ 11.95      $ 12.06      $ 12.09      $ 12.11      $ 11.80   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Performance Ratios (annualized)

          

Return on average assets

     0.71     0.75     0.78     0.75     0.76

Return on average tangible common equity

     10.16        10.27        10.35        9.56        9.45   

Return on average Tier 1 common equity (1) (6)

     10.22        10.35        10.38        9.56        9.38   

Effective tax rate

     32.49        27.79        32.77        31.84        31.35   

Dividend payout ratio (2)

     33.33        32.26        29.03        32.14        33.33   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Average Balances

          

Common stockholders’ equity

   $ 2,785      $ 2,772      $ 2,815      $ 2,830      $ 2,827   

Average Tier 1 common equity (1) (6)

   $ 1,804      $ 1,821      $ 1,871      $ 1,892      $ 1,900   
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Selected Trend Information

          

Average full time equivalent employees

     4,422        4,320        4,359        4,431        4,517   

Trust assets under management, at market value

   $ 8,138      $ 7,993      $ 7,700      $ 7,720      $ 7,535   

Total revenue (3)

   $ 253      $ 249      $ 252      $ 246      $ 243   

Core fee-based revenue (4)

   $ 64      $ 56      $ 54      $ 60      $ 57   

Mortgage loans originated for sale during period

   $ 268      $ 292      $ 298      $ 276      $ 204   

Mortgage portfolio serviced for others

   $ 7,920      $ 7,999      $ 8,012      $ 8,052      $ 8,084   

Mortgage servicing rights, net / Portfolio serviced for others

     0.75     0.75     0.76     0.76     0.77
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

At Period End

          

Loans / deposits

     90.57     93.77     94.27     98.43     93.90

Stockholders’ equity / assets

     10.65     10.44     11.19     11.39     11.69

Tangible common equity / tangible assets (5)

     7.04     6.97     7.57     7.79     7.96

Tangible equity / tangible assets (5)

     7.27     7.20     7.82     8.03     8.22

Shares outstanding, end of period

     153,567        149,560        154,743        159,480        161,012   

Capital (6)

          

Risk weighted assets (7) (8)

   $ 19,565      $ 18,568      $ 18,031      $ 17,911      $ 17,075   

Tier 1 common equity (1)

   $ 1,838      $ 1,808      $ 1,873      $ 1,920      $ 1,912   

Tier 1 common equity / risk-weighted assets (7) (8)

     9.39     9.74     10.39     10.72     11.20

Tier 1 leverage ratio (7) (8)

     7.39     7.48     7.87     8.26     8.46

Tier 1 risk-based capital ratio (7) (8)

     9.70     10.06     10.73     11.06     11.56

Total risk-based capital ratio (7) (8)

     12.21     12.66     11.98     12.31     12.81
  

 

 

   

 

 

   

 

 

   

 

 

   

 

 

 

Non-GAAP Financial Measures Reconciliation

          

Efficiency ratio (9)

     70.30     70.33     69.44     69.70     70.41

Taxable equivalent adjustment

     (1.42 )%      (1.40 )%      (1.36 )%      (1.32 )%      (1.35 )% 

Asset gains, net

     0.30     1.05     1.36     0.26     0.22

Other intangible amortization

     (0.32 )%      (0.32 )%      (0.40 )%      (0.41 )%      (0.42 )% 

Efficiency ratio, fully taxable equivalent (9)

     68.86     69.66     69.04     68.23     68.86

 

(1) Tier 1 common equity, a non-GAAP financial measure, is used by banking regulators, investors and analysts to assess and compare the quality and composition of our capital with the capital of other financial services companies. Management uses Tier 1 common equity, along with other capital measures, to assess and monitor our capital position. Tier 1 common equity (period end and average) is Tier 1 capital excluding qualifying perpetual preferred stock and qualifying trust preferred securities.
(2) Ratio is based upon basic earnings per common share.
(3) Total revenue, a non-GAAP financial measure, is the sum of taxable equivalent net interest income, core fee-based revenues, and other noninterest income categories, as presented on Page 2 in the Consolidated Statements of Income and Page 6 in the Net Interest Income Analysis.
(4) Core fee-based revenue, a non-GAAP financial measure, is the sum of trust service fees, service charges on deposit accounts, card-based and other nondeposit fees, insurance commissions, and brokerage and annuity commissions, as presented on Page 2 in the Consolidated Statements of Income.
(5) Tangible equity, tangible common equity and tangible assets exclude goodwill and other intangible assets, which is a non-GAAP financial measure. These financial measures have been included as they are considered to be critical metrics with which to analyze and evaluate financial condition and capital strength.
(6) Prior to 2015, the regulatory capital requirements effective for the Corporation followed the Capital Accord of the Basel Committee on Banking Supervision (“Basel I”). Beginning January 1, 2015, the regulatory capital requirements effective for the Corporation follow Basel III, subject to certain transition provisions from Basel I over the next three years to full implementation by January 1, 2018.
(7) March 31, 2015 data is estimated.
(8) The Federal Reserve establishes capital adequacy requirements, including well-capitalized standards for the Corporation. The OCC establishes similar capital adequacy requirements and standards for the Bank. Regulatory capital primarily consists of Tier 1 risk-based capital and Tier 2 risk-based capital. The sum of Tier 1 risk-based capital and Tier 2 risk-based capital equals our total risk-based capital. Risk-based capital guidelines require a minimum level of capital as a percentage of risk-weighted assets. Risk-weighted assets consist of total assets plus certain off-balance sheet and market items, subject to adjustment for predefined credit risk factors.
(9) Efficiency ratio is defined by the Federal Reserve guidance as noninterest expense divided by the sum of net interest income plus noninterest income, excluding investment securities gains / losses, net. Efficiency ratio, fully taxable equivalent, is noninterest expense, excluding other intangible amortization, divided by the sum of taxable equivalent net interest income plus noninterest income, excluding investment securities gains / losses, net and asset gains / losses, net. This efficiency ratio is presented on a taxable equivalent basis, which adjusts net interest income for the tax-favored status of certain loans and investment securities. Management believes this measure to be the preferred industry measurement of net interest income as it enhances the comparability of net interest income arising from taxable and tax-exempt sources and it excludes certain specific revenue items (such as investment securities gains / losses, net and asset gains / losses, net).

 

Page 3


Associated Banc-Corp

Selected Asset Quality Information

 

(in thousands)    Mar 31,
2015
    Dec 31,
2014
    Mar 15 vs
Dec 14
% Change
    Sep 30,
2014
    Jun 30,
2014
    Mar 31,
2014
    Mar 15 vs
Mar 14
% Change
 

Allowance for Loan Losses

              

Beginning balance

   $ 266,302      $ 266,262        —     $ 271,851      $ 267,916      $ 268,315        (0.8 )% 

Provision for loan losses

     4,500        4,500        —       (3,000     6,500        5,000        (10.0 )% 

Charge offs

     (13,270     (8,778     51.2     (14,850     (9,107     (11,361     16.8

Recoveries

     7,736        4,318        79.2     12,261        6,542        5,962        29.8
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Net charge offs

     (5,534     (4,460     24.1     (2,589     (2,565     (5,399     2.5
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Ending balance

   $ 265,268      $ 266,302        (0.4 )%    $ 266,262      $ 271,851      $ 267,916        (1.0 )% 
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Allowance for Unfunded Commitments

              

Beginning balance

   $ 24,900      $ 24,400        2.0   $ 20,400      $ 21,900      $ 21,900        13.7

Provision for unfunded commitments

     —          500        (100.0 )%      4,000        (1,500     —          N/M   
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Ending balance

   $ 24,900      $ 24,900        —     $ 24,400      $ 20,400      $ 21,900        13.7
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Allowance for credit losses

   $ 290,168      $ 291,202        (0.4 )%    $ 290,662      $ 292,251      $ 289,816        0.1
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   
Net Charge Offs    Mar 31,
2015
    Dec 31,
2014
    Mar 15 vs
Dec 14
% Change
    Sep 30,
2014
    Jun 30,
2014
    Mar 31,
2014
    Mar 15 vs
Mar 14
% Change
 

Commercial and industrial

   $ 4,650      $ 1,323        251.5   $ 572      $ (1,377   $ 2,725        70.6

Commercial real estate—owner occupied

     739        134        N/M        2,210        (550     (124     N/M   

Lease financing

     —          9        (100.0 )%      (6     29        —          N/M   
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Commercial and business lending

     5,389        1,466        267.6     2,776        (1,898     2,601        107.2

Commercial real estate—investor

     (2,529     (132     N/M        (4,065     (239     (1,031     145.3

Real estate construction

     (743     (116     N/M        350        795        113        N/M   
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Commercial real estate lending

     (3,272     (248     N/M        (3,715     556        (918     256.4
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Total commercial

     2,117        1,218        73.8     (939     (1,342     1,683        25.8

Home equity revolving lines of credit

     1,220        1,094        11.5     1,098        1,380        1,182        3.2

Home equity loans 1st liens

     362        206        75.7     118        448        406        (10.8 )% 

Home equity loans junior liens

     423        457        (7.4 )%      728        948        859        (50.8 )% 
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Home equity

     2,005        1,757        14.1     1,944        2,776        2,447        (18.1 )% 

Installment and credit cards

     769        990        (22.3 )%      910        247        113        N/M   

Residential mortgage

     643        495        29.9     674        884        1,156        (44.4 )% 
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Total consumer

     3,417        3,242        5.4     3,528        3,907        3,716        (8.0 )% 
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Total net charge offs

   $ 5,534      $ 4,460        24.1   $ 2,589      $ 2,565      $ 5,399        2.5
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   
Net Charge Offs to Average Loans (in basis points) *    Mar 31,
2015
    Dec 31,
2014
          Sep 30,
2014
    Jun 30,
2014
    Mar 31,
2014
       

Commercial and industrial

     32        9          4        (10     22     

Commercial real estate—owner occupied

     30        5          84        (20     (5  

Lease financing

     —          7          (5     22        —       
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Commercial and business lending

     31        9          17        (12     17     

Commercial real estate—investor

     (33     (2       (54     (3     (14  

Real estate construction

     (30     (5       14        33        5     
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Commercial real estate lending

     (32     (2       (37     6        (10  
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Total commercial

     8        4          (3     (5     7     

Home equity revolving lines of credit

     56        49          50        64        55     

Home equity loans 1st liens

     26        14          7        26        23     

Home equity loans junior liens

     108        107          159        196        171     
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Home equity

     51        42          45        64        55     

Installment and credit cards

     70        86          78        25        11     

Residential mortgage

     6        4          6        9        12     
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Total consumer

     21        19          22        25        25     
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Total net charge offs

     13        10          6        6        14     
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   
Credit Quality    Mar 31,
2015
    Dec 31,
2014
    Mar 15 vs
Dec 14
% Change
    Sep 30,
2014
    Jun 30,
2014
    Mar 31,
2014
    Mar 15 vs
Mar 14
% Change
 

Nonaccrual loans

   $ 174,346      $ 177,413        (1.7 )%    $ 184,138      $ 179,226      $ 177,978        (2.0 )% 

Other real estate owned (OREO)

     14,926        16,732        (10.8 )%      16,840        17,729        19,173        (22.2 )% 
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Total nonperforming assets

   $ 189,272      $ 194,145        (2.5 )%    $ 200,978      $ 196,955      $ 197,151        (4.0 )% 
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Loans 90 or more days past due and still accruing

   $ 1,715      $ 1,623        5.7   $ 1,690      $ 1,776      $ 723        137.2

Allowance for loan losses / loans

     1.48     1.51       1.55     1.59     1.63  

Allowance for loan losses / nonaccrual loans

     152.15        150.10          144.60        151.68        150.53     

Nonaccrual loans / total loans

     0.97        1.01          1.07        1.05        1.08     

Nonperforming assets / total loans plus OREO

     1.05        1.10          1.17        1.15        1.20     

Nonperforming assets / total assets

     0.70        0.72          0.78        0.77        0.79     

Net charge offs / average loans (annualized)

     0.13        0.10          0.06        0.06        0.14     

Year-to-date net charge offs / average loans

     0.13        0.09          0.08        0.10        0.14     

Nonaccrual loans by type:

              

Commercial and industrial

   $ 61,620      $ 49,663        24.1   $ 51,143      $ 40,846      $ 38,488        60.1

Commercial real estate—owner occupied

     21,861        25,825        (15.3 )%      24,340        31,725        26,735        (18.2 )% 

Lease financing

     1,720        1,801        (4.5 )%      1,947        1,541        172        N/M   
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Commercial and business lending

     85,201        77,289        10.2     77,430        74,112        65,395        30.3

Commercial real estate—investor

     13,742        22,685        (39.4 )%      25,106        28,135        33,611        (59.1 )% 

Real estate construction

     5,423        5,399        0.4     8,187        6,988        6,667        (18.7 )% 
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Commercial real estate lending

     19,165        28,084        (31.8 )%      33,293        35,123        40,278        (52.4 )% 
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Total commercial

     104,366        105,373        (1.0 )%      110,723        109,235        105,673        (1.2 )% 

Home equity revolving lines of credit

     9,171        9,853        (6.9 )%      10,154        10,056        10,356        (11.4 )% 

Home equity loans 1st liens

     5,111        5,290        (3.4 )%      4,664        4,634        5,341        (4.3 )% 

Home equity loans junior liens

     6,145        6,598        (6.9 )%      6,443        6,183        6,788        (9.5 )% 
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Home equity

     20,427        21,741        (6.0 )%      21,261        20,873        22,485        (9.2 )% 

Installment and credit cards

     515        613        (16.0 )%      653        771        915        (43.7 )% 

Residential mortgage

     49,038        49,686        (1.3 )%      51,501        48,347        48,905        0.3
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Total consumer

     69,980        72,040        (2.9 )%      73,415        69,991        72,305        (3.2 )% 
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Total nonaccrual loans

   $ 174,346      $ 177,413        (1.7 )%    $ 184,138      $ 179,226      $ 177,978        (2.0 )% 
  

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

 

* Annualized

N/M = Not meaningful.

 

Page 4


Associated Banc-Corp

Selected Asset Quality Information (continued)

 

(in thousands)    Mar 31,
2015
     Dec 31,
2014
     Mar 15 vs
Dec 14
% Change
    Sep 30,
2014
     Jun 30,
2014
     Mar 31,
2014
     Mar 15 vs
Mar 14
% Change
 

Restructured loans (accruing)

                   

Commercial and industrial

   $ 26,466       $ 33,892         (21.9 )%    $ 36,955       $ 28,849       $ 27,776         (4.7 )% 

Commercial real estate—owner occupied

     9,780         10,454         (6.4 )%      11,574         12,168         11,579         (15.5 )% 
  

 

 

    

 

 

      

 

 

    

 

 

    

 

 

    

Commercial and business lending

     36,246         44,346         (18.3 )%      48,529         41,017         39,355         (7.9 )% 

Commercial real estate—investor

     22,775         23,127         (1.5 )%      24,440         41,758         46,020         (50.5 )% 

Real estate construction

     717         727         (1.4 )%      805         1,224         2,954         (75.7 )% 
  

 

 

    

 

 

      

 

 

    

 

 

    

 

 

    

Commercial real estate lending

     23,492         23,854         (1.5 )%      25,245         42,982         48,974         (52.0 )% 
  

 

 

    

 

 

      

 

 

    

 

 

    

 

 

    

Total commercial

     59,738         68,200         (12.4 )%      73,774         83,999         88,329         (32.4 )% 

Home equity revolving lines of credit

     1,251         1,508         (17.0 )%      1,531         1,527         1,178         6.2

Home equity loans 1st liens

     1,846         1,857         (0.6 )%      1,867         1,674         1,656         11.5

Home equity loans junior liens

     6,642         6,701         (0.9 )%      7,184         7,243         6,738         (1.4 )% 
  

 

 

    

 

 

      

 

 

    

 

 

    

 

 

    

Home equity

     9,739         10,066         (3.2 )%      10,582         10,444         9,572         1.7

Installment and credit cards

     891         974         (8.5 )%      1,106         1,185         225         296.0

Residential mortgage

     18,449         18,976         (2.8 )%      19,141         18,753         18,798         (1.9 )% 
  

 

 

    

 

 

      

 

 

    

 

 

    

 

 

    

Total consumer

     29,079         30,016         (3.1 )%      30,829         30,382         28,595         1.7
  

 

 

    

 

 

      

 

 

    

 

 

    

 

 

    

Total restructured loans (accruing)

   $ 88,817       $ 98,216         (9.6 )%    $ 104,603       $ 114,381       $ 116,924         (24.0 )% 
  

 

 

    

 

 

      

 

 

    

 

 

    

 

 

    

Restructured loans in nonaccrual loans (not included above)

   $ 53,553       $ 57,656         (7.1 )%    $ 63,314       $ 72,388       $ 74,231         (27.9 )% 
  

 

 

    

 

 

      

 

 

    

 

 

    

 

 

    
Loans Past Due 30-89 Days    Mar 31,
2015
     Dec 31,
2014
     Mar 15 vs
Dec 14
% Change
    Sep 30,
2014
     Jun 30,
2014
     Mar 31,
2014
     Mar 15 vs
Mar 14
% Change
 

Commercial and industrial

   $ 1,717       $ 14,747         (88.4 )%    $ 3,947       $ 2,519       $ 4,126         (58.4 )% 

Commercial real estate—owner occupied

     1,849         10,628         (82.6 )%      2,675         6,323         5,342         (65.4 )% 

Lease financing

     —           —           N/M        —           556         567         (100.0 )% 
  

 

 

    

 

 

      

 

 

    

 

 

    

 

 

    

Commercial and business lending

     3,566         25,375         (85.9 )%      6,622         9,398         10,035         (64.5 )% 

Commercial real estate—investor

     2,215         1,208         83.4     15,869         2,994         7,188         (69.2 )% 

Real estate construction

     317         984         (67.8 )%      399         258         679         (53.3 )% 
  

 

 

    

 

 

      

 

 

    

 

 

    

 

 

    

Commercial real estate lending

     2,532         2,192         15.5     16,268         3,252         7,867         (67.8 )% 
  

 

 

    

 

 

      

 

 

    

 

 

    

 

 

    

Total commercial

     6,098         27,567         (77.9 )%      22,890         12,650         17,902         (65.9 )% 

Home equity revolving lines of credit

     7,150         6,725         6.3     6,739         6,986         5,344         33.8

Home equity loans 1st liens

     953         1,800         (47.1 )%      1,503         1,685         1,469         (35.1 )% 

Home equity loans junior liens

     1,905         2,058         (7.4 )%      2,496         2,138         3,006         (36.6 )% 
  

 

 

    

 

 

      

 

 

    

 

 

    

 

 

    

Home equity

     10,008         10,583         (5.4 )%      10,738         10,809         9,819         1.9

Installment and credit cards

     1,818         1,932         (5.9 )%      1,818         1,734         1,269         43.3

Residential mortgage

     3,403         3,046         11.7     3,231         7,070         4,498         (24.3 )% 
  

 

 

    

 

 

      

 

 

    

 

 

    

 

 

    

Total consumer

     15,229         15,561         (2.1 )%      15,787         19,613         15,586         (2.3 )% 
  

 

 

    

 

 

      

 

 

    

 

 

    

 

 

    

Total loans past due 30-89 days

   $ 21,327       $ 43,128         (50.5 )%    $ 38,677       $ 32,263       $ 33,488         (36.3 )% 
  

 

 

    

 

 

      

 

 

    

 

 

    

 

 

    
Potential Problem Loans    Mar 31,
2015
     Dec 31,
2014
     Mar 15 vs
Dec 14
% Change
    Sep 30,
2014
     Jun 30,
2014
     Mar 31,
2014
     Mar 15 vs
Mar 14
% Change
 

Commercial and industrial

   $ 138,403       $ 108,522         27.5   $ 133,416       $ 187,251       $ 109,027         26.9

Commercial real estate—owner occupied

     43,114         48,695         (11.5 )%      49,008         57,757         64,785         (33.5 )% 

Lease financing

     2,009         2,709         (25.8 )%      3,787         2,280         3,065         (34.5 )% 
  

 

 

    

 

 

      

 

 

    

 

 

    

 

 

    

Commercial and business lending

     183,526         159,926         14.8     186,211         247,288         176,877         3.8

Commercial real estate—investor

     26,026         24,043         8.2     28,474         31,903         34,790         (25.2 )% 

Real estate construction

     1,487         1,776         (16.3 )%      2,227         4,473         4,870         (69.5 )% 
  

 

 

    

 

 

      

 

 

    

 

 

    

 

 

    

Commercial real estate lending

     27,513         25,819         6.6     30,701         36,376         39,660         (30.6 )% 
  

 

 

    

 

 

      

 

 

    

 

 

    

 

 

    

Total commercial

     211,039         185,745         13.6     216,912         283,664         216,537         (2.5 )% 

Home equity revolving lines of credit

     247         204         21.1     224         277         310         (20.3 )% 

Home equity loans junior liens

     711         676         5.2     687         822         741         (4.0 )% 
  

 

 

    

 

 

      

 

 

    

 

 

    

 

 

    

Home equity

     958         880         8.9     911         1,099         1,051         (8.8 )% 

Installment and credit cards

     —           2         (100.0 )%      4         844         —           N/M   

Residential mortgage

     6,621         3,781         75.1     2,166         2,445         2,091         216.6
  

 

 

    

 

 

      

 

 

    

 

 

    

 

 

    

Total consumer

     7,579         4,663         62.5     3,081         4,388         3,142         141.2
  

 

 

    

 

 

      

 

 

    

 

 

    

 

 

    

Total potential problem loans

   $ 218,618       $ 190,408         14.8   $ 219,993       $ 288,052       $ 219,679         (0.5 )% 
  

 

 

    

 

 

      

 

 

    

 

 

    

 

 

    

N/M = Not meaningful.

 

Page 5


Associated Banc-Corp

Net Interest Income Analysis—Taxable Equivalent Basis

Sequential Quarter

 

     Three months ended March 31, 2015     Three months ended December 31, 2014  
(in thousands)    Average
Balance
     Interest
Income /Expense
     Average
Yield /Rate
    Average
Balance
     Interest
Income /Expense
     Average
Yield /Rate
 

Earning assets:

                

Loans: (1) (2) (3)

                

Commercial and business lending

   $ 6,993,169       $ 55,915         3.24   $ 6,720,893       $ 59,197         3.50

Commercial real estate lending

     4,102,733         36,403         3.60        4,066,143         37,122         3.62   
  

 

 

    

 

 

      

 

 

    

 

 

    

Total commercial

     11,095,902         92,318         3.37        10,787,036         96,319         3.54   

Residential mortgage

     4,663,849         36,885         3.17        4,490,075         36,228         3.23   

Retail

     2,055,364         23,668         4.64        2,110,144         24,942         4.71   
  

 

 

    

 

 

      

 

 

    

 

 

    

Total loans

     17,815,115         152,871         3.46        17,387,255         157,489         3.60   

Investment securities (1)

     5,754,747         37,159         2.58        5,697,598         36,658         2.57   

Other short-term investments

     578,164         1,692         1.18        407,644         1,821         1.78   
  

 

 

    

 

 

      

 

 

    

 

 

    

Investments and other

     6,332,911         38,851         2.45        6,105,242         38,479         2.52   
  

 

 

    

 

 

      

 

 

    

 

 

    

Total earning assets

     24,148,026       $ 191,722         3.20        23,492,497       $ 195,968         3.32   

Other assets, net

     2,458,899              2,388,268         
  

 

 

         

 

 

       

Total assets

   $ 26,606,925            $ 25,880,765         
  

 

 

         

 

 

       

Interest-bearing liabilities:

                

Savings deposits

   $ 1,277,469       $ 238         0.08   $ 1,264,195       $ 253         0.08

Interest-bearing demand deposits

     3,203,727         1,050         0.13        3,142,537         1,220         0.15   

Money market deposits

     8,653,260         3,785         0.18        8,209,091         3,547         0.17   

Time deposits

     1,594,183         2,546         0.65        1,549,565         2,299         0.59   
  

 

 

    

 

 

      

 

 

    

 

 

    

Total interest-bearing deposits

     14,728,639         7,619         0.21        14,165,388         7,319         0.20   

Federal funds purchased and securities sold under agreements to repurchase

     585,498         231         0.16        600,969         218         0.14   

Other short-term funding

     119,240         81         0.27        464,866         156         0.13   

Long-term funding

     3,735,602         10,872         1.17        3,221,574         8,644         1.07   
  

 

 

    

 

 

      

 

 

    

 

 

    

Total short and long-term funding

     4,440,340         11,184         1.01        4,287,409         9,018         0.84   
  

 

 

    

 

 

      

 

 

    

 

 

    

Total interest-bearing liabilities

     19,168,979       $ 18,803         0.39        18,452,797       $ 16,337         0.35   

Noninterest-bearing demand deposits

     4,326,557              4,367,031         

Other liabilities

     266,660              228,600         

Stockholders’ equity

     2,844,729              2,832,337         
  

 

 

         

 

 

       

Total liabilities and stockholders’ equity

   $ 26,606,925            $ 25,880,765         
  

 

 

    

 

 

      

 

 

    

 

 

    

Net interest income and rate spread

      $ 172,919         2.81      $ 179,631         2.97
     

 

 

         

 

 

    

Net interest margin

           2.89           3.04

Taxable equivalent adjustment

      $ 5,106            $ 4,970      
     

 

 

         

 

 

    

Net Interest Income Analysis—Taxable Equivalent Basis

Comparable Quarter

 

     Three months ended March 31, 2015     Three months ended March 31, 2014  
(in thousands)    Average
Balance
     Interest
Income /Expense
     Average
Yield /Rate
    Average
Balance
     Interest
Income /Expense
     Average
Yield /Rate
 

Earning assets:

                

Loans: (1) (2) (3)

                

Commercial and business lending

   $ 6,993,169       $ 55,915         3.24   $ 6,131,185       $ 51,681         3.42

Commercial real estate lending

     4,102,733         36,403         3.60        3,907,363         35,591         3.69   
  

 

 

    

 

 

      

 

 

    

 

 

    

Total commercial

     11,095,902         92,318         3.37        10,038,548         87,272         3.52   

Residential mortgage

     4,663,849         36,885         3.17        3,926,734         32,664         3.33   

Retail

     2,055,364         23,668         4.64        2,199,335         24,413         4.48   
  

 

 

    

 

 

      

 

 

    

 

 

    

Total loans

     17,815,115         152,871         3.46        16,164,617         144,349         3.61   

Investment securities (1)

     5,754,747         37,159         2.58        5,450,066         36,922         2.71   

Other short-term investments

     578,164         1,692         1.18        277,820         1,449         2.09   
  

 

 

    

 

 

      

 

 

    

 

 

    

Investments and other

     6,332,911         38,851         2.45        5,727,886         38,371         2.68   
  

 

 

    

 

 

      

 

 

    

 

 

    

Total earning assets

     24,148,026       $ 191,722         3.20        21,892,503       $ 182,720         3.36   

Other assets, net

     2,458,899              2,320,710         
  

 

 

         

 

 

       

Total assets

   $ 26,606,925            $ 24,213,213         
  

 

 

         

 

 

       

Interest-bearing liabilities:

                

Savings deposits

   $ 1,277,469       $ 238         0.08   $ 1,195,337       $ 220         0.07

Interest-bearing demand deposits

     3,203,727         1,050         0.13        2,796,247         823         0.12   

Money market deposits

     8,653,260         3,785         0.18        7,173,106         2,825         0.16   

Time deposits

     1,594,183         2,546         0.65        1,659,277         2,291         0.56   
  

 

 

    

 

 

      

 

 

    

 

 

    

Total interest-bearing deposits

     14,728,639         7,619         0.21        12,823,967         6,159         0.19   

Federal funds purchased and securities sold under agreements to repurchase

     585,498         231         0.16        805,187         305         0.15   

Other short-term funding

     119,240         81         0.27        328,516         116         0.14   

Long-term funding

     3,735,602         10,872         1.17        3,004,520         6,511         0.87   
  

 

 

    

 

 

      

 

 

    

 

 

    

Total short and long-term funding

     4,440,340         11,184         1.01        4,138,223         6,932         0.67   
  

 

 

    

 

 

      

 

 

    

 

 

    

Total interest-bearing liabilities

     19,168,979       $ 18,803         0.39        16,962,190       $ 13,091         0.31   

Noninterest-bearing demand deposits

     4,326,557              4,166,305         

Other liabilities

     266,660              195,950         

Stockholders’ equity

     2,844,729              2,888,768         
  

 

 

         

 

 

       

Total liabilities and stockholders’ equity

   $ 26,606,925            $ 24,213,213         
  

 

 

    

 

 

      

 

 

    

 

 

    

Net interest income and rate spread

      $ 172,919         2.81      $ 169,629         3.05
     

 

 

         

 

 

    

Net interest margin

           2.89           3.12

Taxable equivalent adjustment

      $ 5,106            $ 4,656      
     

 

 

         

 

 

    

 

(1) The yield on tax exempt loans and securities is computed on a taxable equivalent basis using a tax rate of 35% for all periods presented and is net of the effects of certain disallowed interest deductions.
(2) Nonaccrual loans and loans held for sale have been included in the average balances.
(3) Interest income includes net loan fees.

 

Page 6


Associated Banc-Corp

Financial Summary and Comparison

 

Period End Loan Composition   Mar 31,
2015
    Dec 31,
2014
    Mar 15 vs
Dec 14
% Change
    Sep 30,
2014
    Jun 30,
2014
    Mar 31,
2014
    Mar 15 vs
Mar 14
% Change
 

Commercial and industrial

  $ 6,140,420      $ 5,905,902        4.0   $ 5,603,899      $ 5,616,205      $ 5,222,141        17.6

Commercial real estate—owner occupied

    1,003,885        1,007,937        (0.4 )%      1,014,335        1,070,463        1,098,089        (8.6 )% 

Lease financing

    49,496        51,529        (3.9 )%      52,600        51,873        52,500        (5.7 )% 
 

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Commercial and business lending

    7,193,801        6,965,368        3.3     6,670,834        6,738,541        6,372,730        12.9

Commercial real estate—investor

    3,086,980        3,056,485        1.0     3,043,361        2,990,732        3,001,219        2.9

Real estate construction

    1,019,571        1,008,956        1.1     982,426        1,000,421        969,617        5.2
 

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Commercial real estate lending

    4,106,551        4,065,441        1.0     4,025,787        3,991,153        3,970,836        3.4
 

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Total commercial

    11,300,352        11,030,809        2.4     10,696,621        10,729,694        10,343,566        9.3

Home equity revolving lines of credit

    879,827        887,779        (0.9 )%      880,435        866,042        856,679        2.7

Home equity loans 1st liens

    549,667        584,131        (5.9 )%      619,774        659,598        705,835        (22.1 )% 

Home equity loans junior liens

    154,120        164,148        (6.1 )%      176,316        187,732        199,488        (22.7 )% 
 

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Home equity

    1,583,614        1,636,058        (3.2 )%      1,676,525        1,713,372        1,762,002        (10.1 )% 

Installment and credit cards

    436,492        454,219        (3.9 )%      459,682        469,203        393,321        11.0

Residential mortgage

    4,658,574        4,472,760        4.2     4,326,262        4,132,783        3,942,555        18.2
 

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Total consumer

    6,678,680        6,563,037        1.8     6,462,469        6,315,358        6,097,878        9.5
 

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Total loans

  $ 17,979,032      $ 17,593,846        2.2   $ 17,159,090      $ 17,045,052      $ 16,441,444        9.4
 

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   
Period End Deposit and Customer Funding Composition   Mar 31,
2015
    Dec 31,
2014
    Mar 15 vs
Dec 14
% Change
    Sep 30,
2014
    Jun 30,
2014
    Mar 31,
2014
    Mar 15 vs
Mar 14
% Change
 

Noninterest-bearing demand

  $ 4,570,872      $ 4,505,272        1.5   $ 4,302,454      $ 4,211,057      $ 4,478,981        2.1

Savings

    1,337,643        1,235,277        8.3     1,256,567        1,275,493        1,252,669        6.8

Interest-bearing demand

    3,525,870        3,126,854        12.8     3,637,411        2,918,900        3,084,457        14.3

Money market

    8,781,206        8,324,646        5.5     7,491,460        7,348,650        7,069,173        24.2

Brokered CDs

    40,699        42,556        (4.4 )%      9,242        44,809        51,235        (20.6 )% 

Other time

    1,595,302        1,528,899        4.3     1,504,124        1,517,350        1,573,412        1.4
 

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Total deposits

    19,851,592        18,763,504        5.8     18,201,258        17,316,259        17,509,927        13.4

Customer repo sweeps

    528,572        384,221        37.6     493,451        489,886        548,179        (3.6 )% 
 

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Total deposits and customer funding

  $ 20,380,164      $ 19,147,725        6.4   $ 18,694,709      $ 17,806,145      $ 18,058,106        12.9
 

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Network transaction deposits included above in interest-bearing demand & money market

  $ 2,900,325      $ 2,852,943        1.7   $ 2,207,055      $ 2,238,923      $ 2,141,976        35.4

Brokered CDs

    40,699        42,556        (4.4 )%      9,242        44,809        51,235        (20.6 )% 
 

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Total network and brokered funding

    2,941,024        2,895,499        1.6     2,216,297        2,283,732        2,193,211        34.1
 

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Net customer deposits and funding (1)

  $ 17,439,140      $ 16,252,226        7.3   $ 16,478,412      $ 15,522,413      $ 15,864,895        9.9
 

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

 

(1) Total deposits and customer funding excluding total network and brokered funding.

 

Quarter Average Loan Composition   Mar 31,
2015
    Dec 31,
2014
    Mar 15 vs
Dec 14
% Change
    Sep 30,
2014
    Jun 30,
2014
    Mar 31,
2014
    Mar 15 vs
Mar 14
% Change
 

Commercial and industrial

  $ 5,944,152      $ 5,665,396        4.9   $ 5,558,135      $ 5,335,488      $ 4,983,943        19.3

Commercial real estate—owner occupied

    998,293        1,003,179        (0.5 )%      1,043,001        1,081,552        1,093,114        (8.7 )% 

Lease financing

    50,724        52,318        (3.0 )%      51,091        51,804        54,128        (6.3 )% 
 

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Commercial and business lending

    6,993,169        6,720,893        4.1     6,652,227        6,468,844        6,131,185        14.1

Commercial real estate—investor

    3,106,965        3,062,427        1.5     3,013,210        3,014,827        2,993,046        3.8

Real estate construction

    995,768        1,003,716        (0.8 )%      1,006,076        953,021        914,317        8.9
 

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Commercial real estate lending

    4,102,733        4,066,143        0.9     4,019,286        3,967,848        3,907,363        5.0
 

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Total commercial

    11,095,902        10,787,036        2.9     10,671,513        10,436,692        10,038,548        10.5

Home equity revolving lines of credit

    882,869        883,580        (0.1 )%      875,388        866,952        868,614        1.6

Home equity loans 1st liens

    567,849        601,719        (5.6 )%      638,592        681,607        724,995        (21.7 )% 

Home equity loans junior liens

    159,378        169,845        (6.2 )%      181,880        193,727        203,984        (21.9 )% 
 

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Home equity

    1,610,096        1,655,144        (2.7 )%      1,695,860        1,742,286        1,797,593        (10.4 )% 

Installment and credit cards

    445,268        455,000        (2.1 )%      464,467        389,794        401,742        10.8

Residential mortgage

    4,663,849        4,490,075        3.9     4,309,121        4,077,617        3,926,734        18.8
 

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Total consumer

    6,719,213        6,600,219        1.8     6,469,448        6,209,697        6,126,069        9.7
 

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Total loans

  $ 17,815,115      $ 17,387,255        2.5   $ 17,140,961      $ 16,646,389      $ 16,164,617        10.2
 

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   
Quarter Average Deposit Composition   Mar 31,
2015
    Dec 31,
2014
    Mar 15 vs
Dec 14
% Change
    Sep 30,
2014
    Jun 30,
2014
    Mar 31,
2014
    Mar 15 vs
Mar 14
% Change
 

Noninterest-bearing demand

  $ 4,326,557      $ 4,367,031        (0.9 )%    $ 4,239,654      $ 4,073,310      $ 4,166,305        3.8

Savings

    1,277,469        1,264,195        1.0     1,269,994        1,267,297        1,195,337        6.9

Interest-bearing demand

    3,203,727        3,142,537        1.9     3,096,712        2,894,446        2,796,247        14.6

Money market

    8,653,260        8,209,091        5.4     7,721,167        7,340,244        7,173,106        20.6

Time deposits

    1,594,183        1,549,565        2.9     1,545,851        1,597,535        1,659,277        (3.9 )% 
 

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

Total deposits

  $ 19,055,196      $ 18,532,419        2.8   $ 17,873,378      $ 17,172,832      $ 16,990,272        12.2
 

 

 

   

 

 

     

 

 

   

 

 

   

 

 

   

 

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