EX-99.1 2 ex991q22022pressrelease.htm EX-99.1 Document

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CONTACT:FOR IMMEDIATE RELEASE
Bryan R. McKeagJuly 25, 2022
Executive Vice President
Chief Financial Officer
(563) 589-1994
BMcKeag@htlf.com

HEARTLAND FINANCIAL USA, INC. ("HTLF") REPORTS QUARTERLY AND YEAR TO DATE RESULTS AS OF JUNE 30, 2022

Highlights and Developments
§Quarterly loan growth of $551.9 million or 5%, exclusive of Paycheck Protection Program ("PPP") loans
§Quarterly net income available to common stockholders of $49.9 million
§Efficiency ratio of 57.66%
§Diluted earnings per common share of $1.17
§Quarterly net charge-offs of $714,000 and 30-89 day loan delinquencies were 0.06% of total loans
§Citywide Banks is now operating as a division of HTLF Bank, completing the first stage of charter consolidation
Quarter Ended
June 30,		Six Months Ended June 30,
2022202120222021
Net income available to common stockholders (in millions)$49.9 $59.6 $90.9 $110.4 
Diluted earnings per common share1.17 1.41 2.14 2.61 
Return on average assets1.06 %1.35 %0.99 %1.27 %
Return on average common equity11.55 12.07 9.82 11.29 
Return on average tangible common equity (non-GAAP)(1)
18.35 18.05 15.08 16.99 
Net interest margin3.18 3.37 3.13 3.40 
Net interest margin, fully tax-equivalent (non-GAAP)(1)
3.22 3.41 3.17 3.45 
Efficiency ratio, fully-tax equivalent (non-GAAP)(1)
57.66 57.11 61.02 56.86 
(1) Refer to "Non-GAAP Measures" in this earnings release for additional information on the usage and presentation of these non-GAAP measures, and refer to the financial tables for reconciliations to the most directly comparable GAAP measures.

"HTLF's second quarter results were excellent and exceeded our expectations. Our tremendous loan growth, solid credit metrics and an improved efficiency ratio are attributable to the continued execution of our growth strategies and provide strong momentum going into the third quarter."
Bruce K. Lee, president and chief executive officer, HTLF


Dubuque, Iowa, Monday, July 25, 2022-Heartland Financial USA, Inc. (NASDAQ: HTLF) today reported the following results for the quarter ended June 30, 2022 compared to the quarter ended June 30, 2021:
•Net income available to common stockholders of $49.9 million compared to $59.6 million, a decrease of $9.7 million or 16%.
•Earnings per diluted common share of $1.17 compared to $1.41, a decrease of $0.24 or 17%.
•Net interest income of $142.5 million compared to $141.2 million, an increase of $1.2 million or 1%.
•Return on average common equity was 11.55% compared to 12.07%, and return on average assets was 1.06% compared to 1.35%.
•Return on average tangible common equity (non-GAAP) was 18.35% compared to 18.05%.

"HTLF's second quarter results were excellent and exceeded our expectations. Our tremendous loan growth, solid credit metrics and an improved efficiency ratio are attributable to the continued execution of our growth strategies and provide strong momentum going into the third quarter," said Bruce K. Lee, president and chief executive officer of HTLF.

HTLF reported the following results for the six months ended June 30, 2022 compared to the six months ended June 30, 2021:
•Net income available to common stockholders of $90.9 million compared to $110.4 million, a decrease of $19.5 million or 18%.
•Earnings per diluted common share of $2.14 compared to $2.61, a decrease of $0.47 or 18%.
•Net interest income of $277.1 million compared to $280.8 million, a decrease of $3.7 million or 1%.
•Return on average common equity was 9.82% compared to 11.29%, and return on average assets was 0.99% compared to 1.27%.
•Return on average tangible common equity (non-GAAP) was 15.08% compared to 16.99%.

Charter Consolidation Update
During the second quarter of 2022, the consolidation of HTLF’s 11 separate bank charters advanced from planning to execution. Citywide Banks is now operating as a division of HTLF Bank, completing the first stage of charter consolidation. Each of the remaining charters will be consolidated into HTLF Bank in the following 10 stages of the project, using a template that retains their current brands, local leadership and local decision making. The final stage is expected to be completed by the end of 2023. Consolidation restructuring costs are projected to be $19-20 million, with approximately $14-15 million of expenses remaining to be incurred through 2023. Charter consolidation is designed to eliminate redundancies and improve HTLF’s operating efficiency and capacity to support ongoing product and service enhancements and current and future growth. The resulting efficiencies and expansion in capacity are projected to generate financial benefits of approximately $20.0 million annually when the project is completed.

Net Interest Income and Net Interest Margin

Net interest margin, expressed as a percentage of average earning assets, was 3.18% (3.22% on a fully tax-equivalent basis, non-GAAP) for the second quarter of 2022 compared to 3.37% (3.41% on a fully tax-equivalent basis, non-GAAP) for the second quarter of 2021.

Total interest income and average earning asset changes for the second quarter of 2022 compared to the second quarter of 2021 were:
•Total interest income was $152.9 million compared to $148.1 million, which was an increase of $4.8 million or 3% and primarily attributable to an increase in average earning assets partially offset by lower yields and a reduction of PPP loan interest income. PPP loan interest income totaled $1.8 million compared to $11.2 million, which was a decrease of $9.4 million or 84%.
•Total interest income on a tax-equivalent basis (non-GAAP) was $154.9 million, which was an increase of $5.0 million or 3% from $149.8 million.
•Average earning assets increased $1.17 billion or 7% to $17.99 billion compared to $16.82 billion.
•The average rate on earning assets decreased 12 basis points to 3.45% compared to 3.57%, which was primarily due to a shift in earning asset mix. Total average securities were 41% of total average earning assets compared to 39%.



Total interest expense and average interest bearing liability changes for the second quarter of 2022 compared to the second quarter of 2021 were:
•Total interest expense was $10.4 million, an increase of $3.6 million or 52% from $6.9 million, based on an increase in the average interest rate paid and an increase in average interest bearing liabilities.
•The average interest rate paid on interest bearing liabilities increased to 0.36% compared to 0.28%.
•Average interest bearing deposits increased $1.68 billion or 18% to $11.08 billion from $9.41 billion.
•The average interest rate paid on interest bearing deposits increased 8 basis points to 0.24% compared to 0.16%.
•Average borrowings increased $25.2 million or 5% to $491.1 million from $465.9 million, and the average interest rate paid on borrowings was 3.18% compared to 2.65%.

Net interest income changes for the second quarter of 2022 compared to the second quarter of 2021 were:
•Net interest income totaled $142.5 million compared to $141.2 million, which was an increase of $1.2 million or 1%. PPP loan interest income totaled $1.8 million compared to $11.2 million, which was a decrease of $9.4 million or 84%.
•Net interest income on a tax-equivalent basis (non-GAAP) totaled $144.4 million compared to $143.0 million, which was an increase of $1.5 million or 1%.

Noninterest Income and Noninterest Expense

Total noninterest income was $34.5 million during the second quarter of 2022 compared to $33.2 million during the second quarter of 2021, an increase of $1.4 million or 4%. Significant changes within the noninterest income category for the second quarter of 2022 compared to the second quarter of 2021 were:
•Service charges and fees increased $2.9 million or 19% to $18.1 million from $15.1 million. Credit card revenue was $5.8 million compared to $4.3 million, which was an increase of $1.5 million or 35%.
•Net security losses totaled $2.1 million compared to net gains of $2.8 million.
•Net gains on sales of loans held for sale totaled $2.9 million compared to $4.8 million, which was a decrease of $1.9 million or 39% and was primarily attributable to a decrease of loans sold to the secondary market.
•Other noninterest income totaled $7.9 million compared to $2.2 million, which was an increase of $5.7 million. The following items impacted other noninterest income for the second quarter of 2022 compared to the second quarter of 2021:
◦Commercial swap fees and syndication income totaled $4.9 million compared to $193,000.
◦Gains on the sale of VISA B shares totaled $1.9 million compared to $0.
Total noninterest expense was $106.5 million during the second quarter of 2022 compared to $103.4 million during the second quarter of 2021, which was an increase of $3.1 million or 3%. Significant changes within the noninterest expense category for the second quarter of 2022 compared to the second quarter of 2021 were:
•Salaries and employee benefits totaled $64.0 million compared to $57.3 million, which was an increase of $6.7 million or 12%. The increase was primarily attributable to higher salary expenses due to inflationary wage pressures and increased health care expenses due to normalized health care usage.
•Net gains on sales/valuations of assets totaled $3.2 million compared to net losses of $183,000, and the change was primarily attributable to a gain of $3.0 million associated with the sale of two branches in Illinois and a gain of $413,000 associated with the sale of an insurance subsidiary.
•Acquisition, integration and restructuring costs totaled $2.4 million compared to $210,000, an increase of $2.2 million due to the progression of the charter consolidation project.

The effective tax rate was 22.89% for the second quarter of 2022 compared to 21.11% for the second quarter of 2021. The following items impacted the second quarter 2022 and 2021 tax calculations:
•Solar energy tax credits of $702,000 compared to $1.3 million.
•Federal low-income housing tax credits of $135,000 in each quarterly calculation.
•New markets tax credits of $75,000 in each quarterly calculation.
•Historic rehabilitation tax credits of $63,000 compared to $123,000.


•Tax-exempt interest income as a percentage of pre-tax income of 11.05% compared to 8.49%.
•Tax expense of $43,000 compared to a tax benefit of $150,000 resulting from the vesting of restricted stock units.

Total Assets, Total Loans and Total Deposits

Total assets were $19.66 billion at June 30, 2022, an increase of $383.9 million or 2% from $19.27 billion at year-end 2021. Securities represented 37% and 40% of total assets at June 30, 2022, and December 31, 2021, respectively.

Total loans held to maturity were $10.68 billion at June 30, 2022, compared to $9.95 billion at December 31, 2021, which was an increase of $723.6 million or 7%. Excluding total PPP loans, loans increased $551.9 million or 5% since March 31, 2022 and $900.5 million or 9% since December 31, 2021.

Significant changes by loan category at June 30, 2022 compared to March 31, 2022 included:
•Commercial and business lending, which includes commercial and industrial, PPP and owner occupied commercial real estate loans, increased $210.7 million or 4% to $5.37 billion compared to $5.15 billion.
•PPP loans originated in 2020 ("PPP I") decreased $2.9 million or 51%. PPP loans originated in 2021 ("PPP II") decreased $48.1 million or 70%.
•Excluding total PPP loans, commercial and business lending increased $261.8 million or 5% to $5.34 billion from $5.08 billion.
•Commercial real estate lending, which includes non-owner occupied commercial real estate and construction loans, increased $162.5 million or 5% to $3.17 billion compared to $3.00 billion.
•Agricultural and agricultural real estate loans increased $70.3 million or 9% to $836.7 million compared to $766.4 million.
•Consumer loans increased $37.3 million or 9% to $464.1 million from $426.8 million.

Significant changes by loan category at June 30, 2022 compared to December 31, 2021 included:
•Commercial and business lending, which includes commercial and industrial, PPP and owner occupied commercial real estate loans, increased $280.1 million or 6% to $5.37 billion compared to $5.09 billion.
•PPP I loans decreased $24.3 million or 90%. PPP II loans decreased $152.5 million or 88%.
•Excluding total PPP loans, commercial and business lending increased $456.9 million or 9% to $5.34 billion from $4.89 billion.
•Commercial real estate lending, which includes non-owner occupied commercial real estate and construction loans, increased $300.1 million or 10% to $3.17 billion compared to $2.87 billion.
•Agricultural and agricultural real estate loans increased $83.0 million or 11% to $836.7 million compared to $753.8 million.
•Consumer loans increased $44.6 million or 11% to $464.1 million from $419.5 million.

Total deposits were $17.23 billion as of June 30, 2022, compared to $16.42 billion at December 31, 2021. Significant deposit changes by category at June 30, 2022 compared to December 31, 2021 included:
•Demand deposits decreased $408.0 million or 6% to $6.09 billion compared to $6.50 billion.
•Savings deposits increased $1.16 billion or 13% to $10.06 billion from $8.90 billion.

Provision and Allowance

Provision and Allowance for Credit Losses for Loans
Provision for credit losses for loans for the second quarter of 2022 was $1.5 million, which was an increase of $8.0 million from a provision benefit of $6.5 million recorded in the second quarter of 2021. The provision expense for the second quarter of 2022 compared to the second quarter of 2021 was impacted by several factors, including:
•loan growth exclusive of PPP loans totaling $551.9 million compared to $287.7 million,
•decrease in nonperforming loans of $22.4 million to $63.0 million or 0.59% of total loans compared to $85.4 million or 0.85% of total loans at June 30, 2021,
•nonpass loans declined to 5.8% of total loans compared to 10.4% of total loans at June 30, 2021, and


•loans delinquent 30-89 days as a percent of total loans fell to 0.06% compared to 0.17% at June 30, 2021.

The allowance for credit losses for loans totaled $101.4 million and $110.1 million at June 30, 2022, and December 31, 2021, respectively. The following items impacted the allowance for credit losses for loans for the six months ended June 30, 2022:
•Provision expense for the six months ended June 30, 2022, totaled $4.2 million.
•Net charge offs of $12.9 million were recorded for the first six months of 2022.

Provision and Allowance for Credit Losses for Unfunded Commitments
The allowance for unfunded commitments totaled $17.8 million at June 30, 2022, which was an increase of $2.3 million from $15.5 million at December 31, 2021. Unfunded commitments increased $628.7 million to $4.46 billion at June 30, 2022 compared to $3.83 billion at December 31, 2021.

Total Provision and Allowance for Lending Related Credit Losses
The total provision expense for lending related credit losses was $3.2 million for the second quarter of 2022 compared to provision benefit of $7.1 million for the second quarter of 2021. The total allowance for lending related credit losses was $119.1 million or 1.12% of total loans at June 30, 2022, compared to $125.6 million or 1.26% of total loans as of December 31, 2021.

Nonperforming Assets

Nonperforming assets decreased $4.4 million or 6% to $67.5 million or 0.34% of total assets at June 30, 2022, compared to $71.9 million or 0.37% of total assets at December 31, 2021. Nonperforming loans were $63.0 million or 0.59% of total loans at June 30, 2022, compared to $69.9 million or 0.70% of total loans at December 31, 2021. At June 30, 2022, loans delinquent 30-89 days were 0.06% of total loans compared to 0.07% of total loans at December 31, 2021.

Non-GAAP Financial Measures
This earnings release contains references to financial measures which are not defined by generally accepted accounting principles ("GAAP"). Management believes the non-GAAP measures are helpful for investors to analyze and evaluate the company's financial condition and operating results. However, these non-GAAP measures have inherent limitations and should not be considered a substitute for operating results determined in accordance with GAAP. Additionally, because non-GAAP measures are not standardized, it may not be possible to compare the non-GAAP measures in this earnings release with other companies' non-GAAP measures. Reconciliations of each non-GAAP measure to the most directly comparable GAAP measure may be found in the financial tables in this earnings release.

Below are the non-GAAP measures included in this earnings release, management's reason for including each measure and the method of calculating each measure:
•Annualized net interest margin, fully tax-equivalent, adjusts net interest income for the tax-favored status of certain loans and securities. Management believes this measure enhances the comparability of net interest income arising from taxable and tax-exempt sources.
•Efficiency ratio, fully tax equivalent, expresses noninterest expenses as a percentage of fully tax-equivalent net interest income and noninterest income. This efficiency ratio is presented on a tax-equivalent basis which adjusts net interest income and noninterest expenses for the tax favored status of certain loans, securities, and tax credit projects. Management believes the presentation of this non-GAAP measure provides supplemental useful information for proper understanding of the financial results as it enhances the comparability of income and expenses arising from taxable and nontaxable sources and excludes specific items as noted in reconciliation contained in this earnings release.
•Net interest income, fully tax equivalent, is net income adjusted for the tax-favored status of certain loans and securities. Management believes this measure enhances the comparability of net interest income arising from taxable and tax-exempt sources.
•Tangible book value per common share is total common equity less goodwill and core deposit and customer relationship intangibles, net, divided by common shares outstanding, net of treasury. This measure is included as it is considered to be a critical metric to analyze and evaluate use of equity, financial condition and capital strength.


•Tangible common equity ratio is total common equity less goodwill and core deposit and customer relationship intangibles, net, divided by total assets less goodwill and core deposit and customer relationship intangibles, net. This measure is included as it is considered to be a critical metric to analyze and evaluate financial condition and capital strength.
•Annualized return on average tangible common equity is net income excluding intangible amortization calculated as (1) net income excluding tax-effected core deposit and customer relationship intangibles amortization, divided by (2) average common equity less goodwill and core deposit and customer relationship intangibles, net. This measure is included as it is considered to be a critical metric to analyze and evaluate use of equity, financial condition and capital strength.
Conference Call Details
HTLF will host a conference call for shareholders, analysts and other interested parties at 5:00 p.m. EDT today. To join via webcast, please visit https://ir.htlf.com/news-and-events/event-calendar/default.aspx 10 minutes prior to the call. A replay will be available until July 23, 2023, by logging on to www.htlf.com.

About HTLF
Heartland Financial USA, Inc., operating under the brand name HTLF, is a financial services company with assets of $19.66 billion. HTLF has banks serving communities in Arizona, California, Colorado, Illinois, Iowa, Kansas, Minnesota, Missouri, Montana, New Mexico, Texas and Wisconsin. HTLF is committed to its core commercial business, supported by a strong retail operation, and provides a diversified line of financial services including treasury management, wealth management, investments and residential mortgage. Additional information is available at www.htlf.com.

Safe Harbor Statement
This release (including any information incorporated herein by reference) contains, and future oral and written statements of HTLF and its management may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, with respect to the business, financial condition, results of operations, plans, objectives and future performance of HTLF.

Any statements about HTLF's expectations, beliefs, plans, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. Forward-looking statements may include information about possible or assumed future results of HTLF's operations or performance, and may be based upon beliefs, expectations and assumptions of HTLF's management. These forward-looking statements are generally identified by the use of the words such as "believe", "expect", "anticipate", "plan", "intend", "estimate", "project", "may", "will", "would", "could", "should", "may", "view", "opportunity", "potential", or similar or negative expressions of these words or phrases that are used in this release, and future oral and written statements of HTLF and its management. Although HTLF may make these statements based on management’s experience, beliefs, expectations, assumptions and best estimate of future events, the ability of HTLF to predict results or the actual effect or outcomes of plans or strategies is inherently uncertain, and there may be events or factors that management has not anticipated. Therefore, the accuracy and achievement of such forward-looking statements and estimates are subject to a number of risks, many of which are beyond the ability of management to control or predict, that could cause actual results to differ materially from those in its forward-looking statements. These factors, which HTLF currently believes could have a material effect on its operations and future prospects, are detailed below and in the risk factors in HTLF's reports filed with the Securities and Exchange Commission ("SEC"), including the "Risk Factors" section under Item 1A of Part I of HTLF’s Annual Report on Form 10-K for the year ended December 31, 2021, include, among others:
•Coronavirus Disease 2019 ("COVID-19") Pandemic Risks, including risks related to the ongoing COVID-19 pandemic and measures enacted by the U.S. federal and state governments and adopted by private businesses in response to the COVID-19 pandemic;
•Economic and Market Conditions Risks, including risks related to changes in the U.S. economy in general and in the local economies in which HTLF conducts its operations and future civil unrest, natural disasters, terrorist threats or acts of war;
•Credit Risks, including risks of increasing credit losses due to deterioration in the financial condition of HTLF's borrowers, changes in asset and collateral values and climate and other borrower industry risks which may impact the provision for credit losses and net charge-offs;


•Liquidity and Interest Rate Risks, including the impact of capital market conditions and changes in monetary policy on our borrowings and net interest income;
•Operational Risks, including processing, information systems, cybersecurity, vendor, business interruption, and fraud risks;
•Strategic and External Risks, including economic, political and competitive forces impacting our business;
•Legal, Compliance and Reputational Risks, including regulatory and litigation risks; and
•Risks of Owning Stock in HTLF, including stock price volatility and dilution as a result of future equity offerings and acquisitions.

There can be no assurance that other factors not currently anticipated by HTLF will not materially and adversely affect HTLF's business, financial condition and results of operations. In addition, many of these risks and uncertainties are currently amplified by and may continue to be amplified by the COVID-19 pandemic and the impact of varying governmental responses that affect HTLF’s customers and the economies where they operate. Additionally, all statements in this release, including forward-looking statements speak only as of the date they are made. HTLF does not undertake and specifically disclaims any obligation to publicly release the results of any revisions which may be made to any forward-looking statement to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events or to otherwise update any statement in light of new information or future events. Further information concerning HTLF and its business, including additional factors that could materially affect HTLF’s financial results, is included in HTLF's filings with the SEC.

-FINANCIAL TABLES FOLLOW-
###



HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
For the Quarter Ended
June 30,		For the Six Months Ended
June 30,
2022202120222021
Interest Income
Interest and fees on loans$108,718 $111,915 $211,087 $224,354 
Interest on securities:
Taxable38,098 31,546 70,718 61,989 
Nontaxable5,508 4,561 11,710 9,064 
Interest on federal funds sold— — — 1 
Interest on deposits with other banks and short-term investments563 60 634 126 
Total Interest Income152,887 148,082 294,149 295,534 
Interest Expense
Interest on deposits6,530 3,790 9,507 8,185 
Interest on short-term borrowings88 98 134 250 
Interest on other borrowings3,808 2,976 7,368 6,276 
Total Interest Expense10,426 6,864 17,009 14,711 
Net Interest Income142,461 141,218 277,140 280,823 
Provision (benefit) for credit losses3,246 (7,080)6,491 (7,728)
Net Interest Income After Provision (Benefit) for Credit Losses139,215 148,298 270,649 288,551 
Noninterest Income
Service charges and fees18,066 15,132 33,317 28,803 
Loan servicing income834 873 1,120 1,711 
Trust fees5,679 6,039 11,758 11,816 
Brokerage and insurance commissions839 865 1,708 1,718 
Securities gains/(losses), net(2,089)2,842 783 2,812 
Unrealized gain/ (loss) on equity securities, net(121)83 (404)(27)
Net gains on sale of loans held for sale2,901 4,753 6,312 11,173 
Valuation adjustment on servicing rights— (526)1,658 391 
Income on bank owned life insurance523 937 1,047 1,766 
Other noninterest income7,907 2,166 11,809 3,318 
Total Noninterest Income34,539 33,164 69,108 63,481 
Noninterest Expense
Salaries and employee benefits64,032 57,332 130,206 116,394 
Occupancy7,094 7,399 14,456 15,317 
Furniture and equipment3,033 3,501 6,552 6,594 
Professional fees15,987 16,237 31,143 29,727 
Advertising1,283 1,649 2,838 3,118 
Core deposit and customer relationship intangibles amortization2,083 2,415 4,137 4,931 
Other real estate and loan collection expenses, net78 414 273 549 
(Gain)/loss on sales/valuations of assets, net(3,230)183 (3,184)377 
Acquisition, integration and restructuring costs2,412 210 2,988 3,138 
Partnership investment in tax credit projects737 1,345 814 1,380 
Other noninterest expenses12,970 12,691 27,053 24,274 
Total Noninterest Expense106,479 103,376 217,276 205,799 
Income Before Income Taxes67,275 78,086 122,481 146,233 
Income taxes15,402 16,481 27,519 31,814 
Net Income51,873 61,605 94,962 114,419 
Preferred dividends(2,012)(2,012)(4,025)(4,025)
Net Income Available to Common Stockholders$49,861 $59,593 $90,937 $110,394 
Earnings per common share-diluted$1.17 $1.41 $2.14 $2.61 
Weighted average shares outstanding-diluted42,565,391 42,359,873 42,562,639 42,357,133 



HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
For the Quarter Ended
6/30/20223/31/202212/31/20219/30/20216/30/2021
Interest Income
Interest and fees on loans$108,718 $102,369 $107,721 $112,062 $111,915 
Interest on securities:
Taxable38,098 32,620 30,637 32,384 31,546 
Nontaxable5,508 6,202 5,595 4,609 4,561 
Interest on federal funds sold— — — — — 
Interest on deposits with other banks and short-term investments563 71 86 132 60 
Total Interest Income152,887 141,262 144,039 149,187 148,082 
Interest Expense
Interest on deposits6,530 2,977 3,168 3,444 3,790 
Interest on short-term borrowings88 46 123 98 98 
Interest on other borrowings3,808 3,560 3,554 3,102 2,976 
Total Interest Expense10,426 6,583 6,845 6,644 6,864 
Net Interest Income142,461 134,679 137,194 142,543 141,218 
Provision (benefit) for credit losses3,246 3,245 (5,313)(4,534)(7,080)
Net Interest Income After Provision (Benefit) for Credit Losses139,215 131,434 142,507 147,077 148,298 
Noninterest Income
Service charges and fees18,066 15,251 15,349 15,551 15,132 
Loan servicing income834 286 781 784 873 
Trust fees5,679 6,079 6,380 6,221 6,039 
Brokerage and insurance commissions839 869 962 866 865 
Securities gains/(losses), net(2,089)2,872 1,563 1,535 2,842 
Unrealized gain/ (loss) on equity securities, net(121)(283)(27)112 83 
Net gains on sale of loans held for sale2,901 3,411 4,151 5,281 4,753 
Valuation adjustment on servicing rights— 1,658 502 195 (526)
Income on bank owned life insurance523 524 1,056 940 937 
Other noninterest income7,907 3,902 2,013 1,239 2,166 
Total Noninterest Income34,539 34,569 32,730 32,724 33,164 
Noninterest Expense
Salaries and employee benefits64,032 66,174 63,031 60,689 57,332 
Occupancy7,094 7,362 7,282 7,366 7,399 
Furniture and equipment3,033 3,519 3,364 3,365 3,501 
Professional fees15,987 15,156 17,631 17,242 16,237 
Advertising1,283 1,555 2,218 1,921 1,649 
Core deposit and customer relationship intangibles amortization2,083 2,054 2,169 2,295 2,415 
Other real estate and loan collection expenses, net78 195 363 78 414 
(Gain)/loss on sales/valuations of assets, net(3,230)46 214 (3)183 
Acquisition, integration and restructuring costs2,412 576 1,989 204 210 
Partnership investment in tax credit projects737 77 2,549 2,374 1,345 
Other noninterest expenses12,970 14,083 14,576 15,096 12,691 
Total Noninterest Expense106,479 110,797 115,386 110,627 103,376 
Income Before Income Taxes67,275 55,206 59,851 69,174 78,086 
Income taxes15,402 12,117 10,271 13,250 16,481 
Net Income51,873 43,089 49,580 55,924 61,605 
Preferred dividends(2,012)(2,013)(2,012)(2,013)(2,012)
Net Income Available to Common Stockholders$49,861 $41,076 $47,568 $53,911 $59,593 
Earnings per common share-diluted$1.17 $0.97 $1.12 $1.27 $1.41 
Weighted average shares outstanding-diluted42,565,391 42,540,953 42,479,442 42,415,993 42,359,873 



HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
As of
6/30/20223/31/202212/31/20219/30/20216/30/2021
Assets
Cash and due from banks$221,077 $198,559 $163,895 $192,247 $208,702 
Interest bearing deposits with other banks and short-term investments163,717 406,343 271,704 135,158 240,426 
Cash and cash equivalents384,794 604,902 435,599 327,405 449,128 
Time deposits in other financial institutions1,855 2,894 2,894 3,138 3,138 
Securities:
Carried at fair value7,106,218 7,025,243 7,530,374 7,449,936 6,543,978 
Held to maturity, at cost, less allowance for credit losses81,939 81,785 84,709 85,354 85,439 
Other investments, at cost85,899 82,751 82,567 83,332 76,809 
Loans held for sale18,803 22,685 21,640 37,078 33,248 
Loans:
Held to maturity10,678,218 10,177,385 9,954,572 9,854,907 10,012,014 
 Allowance for credit losses(101,353)(100,522)(110,088)(117,533)(120,726)
Loans, net10,576,865 10,076,863 9,844,484 9,737,374 9,891,288 
Premises, furniture and equipment, net206,818 213,752 215,827 221,996 226,358 
Goodwill576,005 576,005 576,005 576,005 576,005 
Core deposit and customer relationship intangibles, net28,851 30,934 32,988 35,157 37,452 
Servicing rights, net8,288 8,102 6,890 6,351 6,201 
Cash surrender value on life insurance192,474 192,267 191,722 190,576 189,619 
Other real estate, net4,528 1,422 1,927 4,744 6,314 
Other assets385,062 311,274 246,923 237,779 246,029 
Total Assets$19,658,399 $19,230,879 $19,274,549 $18,996,225 $18,371,006 
Liabilities and Equity
Liabilities
Deposits:
 Demand$6,087,304 $6,376,249 $6,495,326 $6,537,722 $6,299,289 
 Savings10,059,678 9,236,427 8,897,909 8,416,204 8,189,223 
 Time1,078,568 1,054,008 1,024,020 1,068,317 1,126,606 
Total deposits17,225,550 16,666,684 16,417,255 16,022,243 15,615,118 
Short-term borrowings97,749 107,372 131,597 265,620 152,563 
Other borrowings372,538 372,290 372,072 371,765 271,244 
Accrued expenses and other liabilities188,494 152,676 171,447 164,345 172,295 
Total Liabilities17,884,331 17,299,022 17,092,371 16,823,973 16,211,220 
Stockholders' Equity
Preferred equity110,705 110,705 110,705 110,705 110,705 
Common stock42,439 42,370 42,275 42,250 42,245 
Capital surplus1,076,766 1,073,048 1,071,956 1,068,913 1,066,765 
Retained earnings1,031,076 992,655 962,994 926,834 883,484 
Accumulated other comprehensive income (loss)(486,918)(286,921)(5,752)23,550 56,587 
Total Equity1,774,068 1,931,857 2,182,178 2,172,252 2,159,786 
Total Liabilities and Equity$19,658,399 $19,230,879 $19,274,549 $18,996,225 $18,371,006 



HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA AND FULL TIME EQUIVALENT EMPLOYEE DATA
For the Quarter Ended
6/30/20223/31/202212/31/20219/30/20216/30/2021
Average Balances
Assets$19,559,091 $19,229,872 $19,151,691 $18,608,775 $18,293,756 
Loans, net of unearned10,477,368 10,043,594 9,886,027 9,920,047 10,072,071 
Deposits17,044,479 16,459,378 16,265,476 15,817,778 15,576,345 
Earning assets17,987,734 17,757,067 17,681,917 17,123,824 16,819,978 
Interest bearing liabilities11,575,319 10,453,400 10,207,255 9,881,350 9,871,302 
Common equity1,731,393 2,003,424 2,061,973 2,072,593 1,980,904 
Total stockholders' equity1,842,098 2,114,129 2,172,678 2,183,298 2,091,609 
Tangible common equity (non-GAAP)(1)
1,125,543 1,395,488 1,451,950 1,460,309 1,366,285 
Key Performance Ratios
Annualized return on average assets1.06 %0.91 %1.03 %1.19 %1.35 %
Annualized return on average common equity (GAAP)11.55 8.32 9.15 10.32 12.07 
Annualized return on average tangible common equity (non-GAAP)(1)
18.35 12.41 13.47 15.14 18.05 
Annualized ratio of net charge-offs/(recoveries) to average loans0.03 0.49 0.03 (0.05)0.12 
Annualized net interest margin (GAAP)3.18 3.08 3.08 3.30 3.37 
Annualized net interest margin, fully tax-equivalent (non-GAAP)(1)
3.22 3.12 3.12 3.34 3.41 
Efficiency ratio, fully tax-equivalent (non-GAAP)(1)
57.66 64.65 63.86 60.38 57.11 

For the Quarter Ended
June 30,		For the Six Months Ended
June 30,
2022202120222021
Average Balances
Assets$19,559,091 $18,293,756 $19,395,391 $18,130,148 
Loans, net of unearned10,477,368 10,072,071 10,261,679 10,012,443 
Deposits17,044,479 15,576,345 16,753,544 15,311,921 
Earning assets17,987,734 16,819,978 17,873,037 16,641,045 
Interest bearing liabilities11,575,319 9,871,302 11,017,459 9,894,103 
Common equity1,731,393 1,980,904 1,866,657 1,972,337 
Total stockholders' equity1,842,098 2,091,609 1,977,362 2,083,042 
Tangible common stockholders' equity1,125,543 1,366,285 1,259,769 1,356,333 
Key Performance Ratios
Annualized return on average assets1.06 %1.35 %0.99 %1.27 %
Annualized return on average common equity (GAAP)11.55 12.07 9.82 11.29 
Annualized return on average tangible common equity (non-GAAP)(1)
18.35 18.05 15.08 16.99 
Annualized ratio of net charge-offs/(recoveries) to average loans0.03 0.12 0.25 0.09 
Annualized net interest margin (GAAP)3.18 3.37 3.13 3.40 
Annualized net interest margin, fully tax-equivalent (non-GAAP)(1)
3.22 3.41 3.17 3.45 
Efficiency ratio, fully tax-equivalent (non-GAAP)(1)
57.66 57.11 61.02 56.86 
(1) Refer to "Non-GAAP Measures" in this earnings release for additional information on the usage and presentation of these non-GAAP measures, and refer to these financial tables for the reconciliations to the most directly comparable GAAP measures.



HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE AND FULL TIME EQUIVALENT EMPLOYEE DATA
As of and for the Quarter Ended
6/30/20223/31/202212/31/20219/30/20216/30/2021
Common Share Data
Book value per common share$39.19 $42.98 $49.00 $48.79 $48.50 
Tangible book value per common share (non-GAAP)(1)
$24.94 $28.66 $34.59 $34.33 $33.98 
Common shares outstanding, net of treasury stock42,439,439 42,369,908 42,275,264 42,250,092 42,245,452 
Tangible common equity ratio (non-GAAP)(1)
5.56 %6.52 %7.84 %7.89 %8.08 %
Other Selected Trend Information
Effective tax rate22.89 %21.95 %17.16 %19.15 %21.11 %
Full time equivalent employees2,087 2,208 2,249 2,163 2,091 
Loans Held to Maturity
Commercial and industrial$3,059,519 $2,814,513 $2,645,085 $2,538,369 $2,518,908 
Paycheck Protection Program ("PPP") 23,031 74,065 199,883 409,247 829,175 
Owner occupied commercial real estate 2,282,833 2,266,076 2,240,334 2,135,227 1,940,134 
Commercial and business lending5,365,383 5,154,654 5,085,302 5,082,843 5,288,217 
Non-owner occupied commercial real estate2,321,718 2,161,761 2,010,591 2,020,487 1,987,369 
Real estate construction845,045 842,483 856,119 814,001 854,295 
Commercial real estate lending 3,166,763 3,004,244 2,866,710 2,834,488 2,841,664 
Total commercial lending 8,532,146 8,158,898 7,952,012 7,917,331 8,129,881 
Agricultural and agricultural real estate836,703 766,443 753,753 684,670 679,608 
Residential mortgage845,270 825,242 829,283 840,356 800,884 
Consumer464,099 426,802 419,524 412,550 401,641 
Total loans held to maturity$10,678,218 $10,177,385 $9,954,572 $9,854,907 $10,012,014 
Total unfunded loan commitments $4,458,874 $4,130,316 $3,830,219 $3,583,417 $3,433,062 
(1) Refer to "Non-GAAP Measures" in this earnings release for additional information on the usage and presentation of these non-GAAP measures, and refer to these financial tables for the reconciliations to the most directly comparable GAAP measures.



HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
As of and for the Quarter Ended
6/30/20223/31/202212/31/20219/30/20216/30/2021
Allowance for Credit Losses-Loans
Balance, beginning of period$100,522 $110,088 $117,533 $120,726 $130,172 
Provision (benefit) for credit losses1,545 2,628 (6,808)(4,448)(6,466)
Charge-offs(1,473)(13,217)(1,953)(1,167)(3,497)
Recoveries759 1,023 1,316 2,422 517 
Balance, end of period$101,353 $100,522 $110,088 $117,533 $120,726 
Allowance for Unfunded Commitments
Balance, beginning of period$16,079 $15,462 $13,967 $14,002 $14,619 
Provision (benefit) for credit losses1,701 617 1,495 (35)(617)
Balance, end of period$17,780 $16,079 $15,462 $13,967 $14,002 
Allowance for lending related credit losses$119,133$116,601$125,550$131,500$134,728
Provision for Credit Losses
Provision (benefit) for credit losses-loans$1,545 $2,628 $(6,808)$(4,448)$(6,466)
Provision (benefit) for credit losses-unfunded commitments 1,701 617 1,495 (35)(617)
Provision (benefit) for credit losses-held to maturity securities — — — (51)3 
Total provision (benefit) for credit losses$3,246 $3,245 $(5,313)$(4,534)$(7,080)
Asset Quality
Nonaccrual loans$62,909 $64,174 $69,369 $82,375 $85,268 
Loans past due ninety days or more 95 246 550 861 97 
Other real estate owned4,528 1,422 1,927 4,744 6,314 
Other repossessed assets— 34 43 166 50 
Total nonperforming assets$67,532 $65,876 $71,889 $88,146 $91,729 
Performing troubled debt restructured loans$1,350 $882 $817 $1,817 $2,122 
Nonperforming Assets Activity
Balance, beginning of period$65,876 $71,889 $88,146 $91,729 $98,364 
Net loan (charge offs)/recoveries (714)(12,194)(637)1,255 (2,980)
New nonperforming loans8,590 15,832 5,886 6,908 7,989 
Reduction of nonperforming loans(1)
(5,244)(8,448)(18,429)(8,581)(10,948)
Net OREO/repossessed assets sales proceeds and losses(976)(1,203)(3,077)(3,165)(696)
Balance, end of period$67,532 $65,876 $71,889 $88,146 $91,729 
Asset Quality Ratios
Ratio of nonperforming loans to total loans0.59 %0.63 %0.70 %0.84 %0.85 %
Ratio of nonperforming loans and performing trouble debt restructured loans to total loans0.60 0.64 0.71 0.86 0.87 
Ratio of nonperforming assets to total assets0.34 0.34 0.37 0.46 0.50 
Annualized ratio of net loan charge-offs/(recoveries) to average loans 0.03 0.49 0.03 (0.05)0.12 
Allowance for loan credit losses as a percent of loans0.95 0.99 1.11 1.19 1.21 
Allowance for lending related credit losses as a percent of loans1.12 1.15 1.26 1.33 1.35 
Allowance for loan credit losses as a percent of nonperforming loans160.87 156.04 157.45 141.20 141.42 
Loans delinquent 30-89 days as a percent of total loans0.06 0.10 0.07 0.12 0.17 
(1) Includes principal reductions, transfers to performing status and transfers to OREO.



HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS
For the Quarter Ended
June 30, 2022March 31, 2022June 30, 2021
Average
Balance		InterestRateAverage
Balance		InterestRateAverage
Balance		InterestRate
Earning Assets
Securities:
Taxable$6,419,615 $38,098 2.38 %$6,501,664 $32,620 2.03 %$5,862,683 $31,546 2.16 %
Nontaxable(1)
915,880 6,972 3.05 1,106,951 7,851 2.88 740,601 5,773 3.13 
Total securities7,335,495 45,070 2.46 7,608,615 40,471 2.16 6,603,284 37,319 2.27 
Interest on deposits with other banks and short-term investments277,773 563 0.81 216,451 71 0.13 271,891 60 0.09 
Federal funds sold— — — 11 — — — — — 
Loans:(2)
Commercial and industrial(1)
3,002,822 30,441 4.07 2,744,336 27,053 4.00 2,469,742 28,562 4.64 
PPP loans41,370 1,801 17.46 132,050 4,323 13.28 1,047,559 11,186 4.28 
Owner occupied commercial real estate2,294,524 22,863 4.00 2,243,522 21,278 3.85 1,858,891 20,097 4.34 
Non-owner occupied commercial real estate2,179,048 22,871 4.21 2,060,548 21,163 4.17 1,980,374 21,734 4.40 
Real estate construction 878,555 10,015 4.57 847,250 9,276 4.44 815,738 9,212 4.53 
Agricultural and agricultural real estate782,610 7,933 4.07 745,348 7,006 3.81 672,560 7,267 4.33 
Residential mortgage849,174 8,358 3.95 843,881 8,085 3.89 827,291 9,255 4.49 
Consumer449,265 4,949 4.42 426,659 4,655 4.42 399,916 5,152 5.17 
Less: allowance for credit losses-loans(102,902)— — (111,604)— — (127,268)— — 
Net loans10,374,466 109,231 4.22 9,931,990 102,839 4.20 9,944,803 112,465 4.54 
Total earning assets17,987,734 154,864 3.45 %17,757,067 143,381 3.27 %16,819,978 149,844 3.57 %
Nonearning Assets1,571,357 1,472,805 1,473,778 
Total Assets$19,559,091 $19,229,872 $18,293,756 
Interest Bearing Liabilities
Savings$9,995,497 $5,372 0.22 %$8,889,950 $2,394 0.11 %$8,234,151 $2,233 0.11 %
Time deposits1,088,765 1,158 0.43 1,071,675 583 0.22 1,171,266 1,557 0.53 
Short-term borrowings118,646 88 0.30 119,588 46 0.16 169,822 98 0.23 
Other borrowings372,411 3,808 4.10 372,187 3,560 3.88 296,063 2,976 4.03 
Total interest bearing liabilities11,575,319 10,426 0.36 %10,453,400 6,583 0.26 %9,871,302 6,864 0.28 %
Noninterest Bearing Liabilities
Noninterest bearing deposits5,960,217 6,497,753 6,170,928 
Accrued interest and other liabilities181,457 164,590 159,917 
Total noninterest bearing liabilities6,141,674 6,662,343 6,330,845 
Equity1,842,098 2,114,129 2,091,609 
Total Liabilities and Equity$19,559,091 $19,229,872 $18,293,756 
Net interest income, fully tax-equivalent (non-GAAP)(1)(3)
$144,438 $136,798 $142,980 
Net interest spread(1)
3.09 %3.01 %3.29 %
Net interest income, fully tax-equivalent (non-GAAP)(1)(3) to total earning assets
3.22 %3.12 %3.41 %
Interest bearing liabilities to earning assets64.35 %58.87 %58.69 %
(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.
(2) Nonaccrual loans and loans held for sale are included in the average loans outstanding.
(3) Refer to "Non-GAAP Measures" in this earnings release for additional information on the usage and presentation of these non-GAAP measures, and refer to these financial tables for the reconciliations to the most directly comparable GAAP measures.






HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS
For the Six Months Ended
June 30, 2022June 30, 2021
Average
Balance		InterestRateAverage
Balance		InterestRate
Earning Assets
Securities:
Taxable$6,460,412 $70,718 2.21 %$5,778,333 $61,989 2.16 %
Nontaxable(1)
1,010,888 14,823 2.96 735,636 11,473 3.15 
Total securities7,471,300 85,541 2.31 %6,513,969 73,462 2.27 %
Interest bearing deposits with other banks and other short-term investments247,281 634 0.52 238,376 126 0.11 
Federal funds sold6 — — 6,971 1 0.03 
Loans:(2)
Commercial and industrial(1)
2,874,694 57,494 4.03 %2,485,210 56,784 4.61 %
PPP loans 86,460 6,124 14.28 1,020,190 21,335 4.22 
Owner occupied commercial real estate2,268,963 44,141 3.92 1,818,932 39,662 4.40 
Non-owner occupied commercial real estate2,119,925 44,034 4.19 1,958,938 43,855 4.51 
Real estate construction862,989 19,291 4.51 811,053 18,910 4.70 
Agricultural and agricultural real estate
764,082 14,939 3.94 676,895 15,318 4.56 
Residential mortgage846,542 16,443 3.92 838,545 19,085 4.59 
Consumer438,024 9,604 4.42 402,680 10,519 5.27 
Less: allowance for credit losses-loans(107,229)— — (130,714)— — 
Net loans10,154,450 212,070 4.21 9,881,729 225,468 4.60 
Total earning assets17,873,037 298,245 3.37 %16,641,045 299,057 3.62 %
Nonearning Assets1,522,354 1,489,103 
Total Assets$19,395,391 $18,130,148 
Interest Bearing Liabilities
Savings$9,445,778 $7,766 0.17 %$8,133,787 $4,663 0.12 %
Time deposits1,080,267 1,741 0.32 1,202,301 3,522 0.59 
Short-term borrowings119,115 134 0.23 204,735 250 0.25 
Other borrowings372,299 7,368 3.99 353,280 6,276 3.58 
Total interest bearing liabilities11,017,459 17,009 0.31 %9,894,103 14,711 0.30 %
Noninterest Bearing Liabilities
Noninterest bearing deposits6,227,499 5,975,833 
Accrued interest and other liabilities173,071 177,170 
Total noninterest bearing liabilities6,400,570 6,153,003 
Stockholders' Equity1,977,362 2,083,042 
Total Liabilities and Stockholders' Equity$19,395,391 $18,130,148 
Net interest income, fully tax-equivalent (non-GAAP)(1)(3)
$281,236 $284,346 
Net interest spread(1)
3.06 %3.32 %
Net interest income, fully tax-equivalent (non-GAAP)(1)(3) to total earning assets
3.17 %3.45 %
Interest bearing liabilities to earning assets61.64 %59.46 %
(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.
(2) Nonaccrual loans and loans held for sale are included in the average loans outstanding.
(3) Refer to "Non-GAAP Measures" in this earnings release for additional information on the usage and presentation of these non-GAAP measures, and refer to these financial tables for the reconciliations to the most directly comparable GAAP measures.



HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA AND FULL TIME EQUIVALENT EMPLOYEE DATA
For the Quarter Ended
6/30/20223/31/202212/31/20219/30/20216/30/2021
Reconciliation of Annualized Return on Average Tangible Common Equity (non-GAAP)
Net income available to common stockholders (GAAP)$49,861 $41,076 $47,568 $53,911 $59,593 
Plus core deposit and customer relationship intangibles amortization, net of tax(1)
1,645 1,623 1,713 1,814 1,907 
Net income available to common stockholders excluding intangible amortization (non-GAAP)$51,506 $42,699 $49,281 $55,725 $61,500 
Average common equity (GAAP)$1,731,393 $2,003,424 $2,061,973 $2,072,593 $1,980,904 
Less average goodwill576,005 576,005 576,005 576,005 576,005 
Less average core deposit and customer relationship intangibles, net29,845 31,931 34,018 36,279 38,614 
Average tangible common equity (non-GAAP)$1,125,543 $1,395,488 $1,451,950 $1,460,309 $1,366,285 
Annualized return on average common equity (GAAP)11.55 %8.32 %9.15 %10.32 %12.07 %
Annualized return on average tangible common equity (non-GAAP)18.35 %12.41 %13.47 %15.14 %18.05 %
Reconciliation of Annualized Net Interest Margin, Fully Tax-Equivalent (non-GAAP)
Net Interest Income (GAAP)$142,461 $134,679 $137,194 $142,543 $141,218 
Plus tax-equivalent adjustment(1)
1,977 2,119 1,975 1,714 1,762 
Net interest income, fully tax-equivalent (non-GAAP)$144,438 $136,798 $139,169 $144,257 $142,980 
Average earning assets$17,987,734 $17,757,067 $17,681,917 $17,123,824 $16,819,978 
Annualized net interest margin (GAAP)3.18 %3.08 %3.08 %3.30 %3.37 %
Annualized net interest margin, fully tax-equivalent (non-GAAP)3.22 3.12 3.12 3.34 3.41 
Net purchase accounting discount amortization on loans included in annualized net interest margin 0.07 0.05 0.05 0.08 0.09 
Reconciliation of Tangible Book Value Per Common Share (non-GAAP)
Common equity (GAAP)$1,663,363 $1,821,152 $2,071,473 $2,061,547 $2,049,081 
Less goodwill576,005 576,005 576,005 576,005 576,005 
Less core deposit and customer relationship intangibles, net28,851 30,934 32,988 35,157 37,452 
Tangible common equity (non-GAAP)$1,058,507 $1,214,213 $1,462,480 $1,450,385 $1,435,624 
Common shares outstanding, net of treasury stock42,439,439 42,369,908 42,275,264 42,250,092 42,245,452 
Common equity (book value) per share (GAAP)$39.19 $42.98 $49.00 $48.79 $48.50 
Tangible book value per common share (non-GAAP)$24.94 $28.66 $34.59 $34.33 $33.98 
Reconciliation of Tangible Common Equity Ratio (non-GAAP)
Tangible common equity (non-GAAP)$1,058,507 $1,214,213 $1,462,480 $1,450,385 $1,435,624 
Total assets (GAAP)$19,658,399 $19,230,879 $19,274,549 $18,996,225 $18,371,006 
Less goodwill576,005 576,005 576,005 576,005 576,005 
Less core deposit and customer relationship intangibles, net28,851 30,934 32,988 35,157 37,452 
Total tangible assets (non-GAAP)$19,053,543 $18,623,940 $18,665,556 $18,385,063 $17,757,549 
Tangible common equity ratio (non-GAAP)5.56 %6.52 %7.84 %7.89 %8.08 %
(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.



HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
Reconciliation of Efficiency Ratio (non-GAAP)For the Quarter Ended
6/30/20223/31/202212/31/20219/30/20216/30/2021
Net interest income (GAAP)$142,461 $134,679 $137,194 $142,543 $141,218 
Tax-equivalent adjustment(1)
1,977 2,119 1,975 1,714 1,762 
Fully tax-equivalent net interest income 144,438 136,798 139,169 144,257 142,980 
Noninterest income34,539 34,569 32,730 32,724 33,164 
Securities (gains)/losses, net2,089 (2,872)(1,563)(1,535)(2,842)
Unrealized (gain)/loss on equity securities, net121 283 27 (112)(83)
Valuation adjustment on servicing rights— (1,658)(502)(195)526 
Adjusted revenue (non-GAAP)$181,187 $167,120 $169,861 $175,139 $173,745 
Total noninterest expenses (GAAP)$106,479 $110,797 $115,386 $110,627 $103,376 
Less:
Core deposit and customer relationship intangibles amortization2,083 2,054 2,169 2,295 2,415 
Partnership investment in tax credit projects737 77 2,549 2,374 1,345 
(Gain)/loss on sales/valuation of assets, net (3,230)46 214 (3)183 
Acquisition, integration and restructuring costs2,412 576 1,989 204 210 
Adjusted noninterest expenses (non-GAAP)$104,477 $108,044 $108,465 $105,757 $99,223 
Efficiency ratio, fully tax-equivalent (non-GAAP)57.66 %64.65 %63.86 %60.38 %57.11 %
Acquisition, integration and restructuring costs
Salaries and employee benefits$275 $340 $— $— $44 
Occupancy— — — — 1 
Furniture and equipment— — — 7 41 
Professional fees1,779 236 1,989 145 63 
Advertising156 — — 11 6 
(Gain)/loss on sales/valuations of assets, net — — — 39 — 
Other noninterest expenses202 — — 2 55 
Total acquisition, integration and restructuring costs$2,412 $576 $1,989 $204 $210 
After tax impact on diluted earnings per common share(1)
$0.04 $0.01 $0.05 $— $— 
(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.



HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
For the Quarter Ended
June 30,		For the Six Months Ended
June 30,
2022202120222021
Reconciliation of Annualized Return on Average Tangible Common Equity (non-GAAP)
Net income available to common stockholders (GAAP)$49,861 $59,593 $90,937 $110,394 
Plus core deposit and customer relationship intangibles amortization, net of tax(1)
1,645 1,907 3,268 3,895 
Net income available to common stockholders excluding intangible amortization (non-GAAP)$51,506 $61,500 $94,205 $114,289 
Average common equity (GAAP)$1,731,393 $1,980,904 $1,866,657 $1,972,337 
Less average goodwill576,005 576,005 576,005 576,005 
Less average core deposit and customer relationship intangibles, net29,845 38,614 30,883 39,999 
Average tangible common equity (non-GAAP)$1,125,543 $1,366,285 $1,259,769 $1,356,333 
Annualized return on average common equity (GAAP)11.55 %12.07 %9.82 %11.29 %
Annualized return on average tangible common equity (non-GAAP)18.35 %18.05 %15.08 %16.99 %
Reconciliation of Annualized Net Interest Margin, Fully Tax-Equivalent (non-GAAP)
Net Interest Income (GAAP)$142,461 $141,218 $277,140 $280,823 
Plus tax-equivalent adjustment(1)
1,977 1,762 4,096 3,523 
Net interest income, fully tax-equivalent (non-GAAP)$144,438 $142,980 $281,236 $284,346 
Average earning assets$17,987,734 $16,819,978 $17,873,037 $16,641,045 
Annualized net interest margin (GAAP)3.18 %3.37 %3.13 %3.40 %
Annualized net interest margin, fully tax-equivalent (non-GAAP)3.22 3.41 3.17 3.45 
Purchase accounting discount amortization on loans included in annualized net interest margin0.07 0.09 0.06 0.11 
(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.



HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
Reconciliation of Efficiency Ratio (non-GAAP)For the Quarter Ended
June 30,		For the Six Months Ended
June 30,
2022202120222021
Net interest income (GAAP)$142,461 $141,218 $277,140 $280,823 
Tax-equivalent adjustment(1)
1,977 1,762 4,096 3,523 
Fully tax-equivalent net interest income144,438 142,980 281,236 284,346 
Noninterest income34,539 33,164 69,108 63,481 
Securities (gains)/losses, net2,089 (2,842)(783)(2,812)
Unrealized (gain)/loss on equity securities, net121 (83)404 27 
Valuation adjustment on servicing rights— 526 (1,658)(391)
Adjusted revenue (non-GAAP)$181,187 $173,745 $348,307 $344,651 
Total noninterest expenses (GAAP)$106,479 $103,376 $217,276 $205,799 
Less:
Core deposit and customer relationship intangibles amortization2,083 2,415 4,137 4,931 
Partnership investment in tax credit projects737 1,345 814 1,380 
(Gain)/loss on sales/valuation of assets, net(3,230)183 (3,184)377 
Acquisition, integration and restructuring costs2,412 210 2,988 3,138 
Adjusted noninterest expenses (non-GAAP)$104,477 $99,223 $212,521 $195,973 
Efficiency ratio, fully tax-equivalent (non-GAAP)57.66 %57.11 %61.02 %56.86 %
Acquisition, integration and restructuring costs
Salaries and employee benefits$275 $44 $615 $578 
Occupancy— 1 — 10 
Furniture and equipment— 41 — 648 
Professional fees1,779 63 2,015 733 
Advertising156 6 156 162 
(Gain)/loss on sales/valuations of assets, net— — — — 
Other noninterest expenses202 55 202 1,007 
Total acquisition, integration and restructuring costs$2,412 $210 $2,988 $3,138 
After tax impact on diluted earnings per common share(1)
$0.04 $— $0.06 $0.06 
(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.