EX-99.1 2 ex991q42022pressrelease.htm EX-99.1 Document

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CONTACT:FOR IMMEDIATE RELEASE
Bryan R. McKeagJanuary 30, 2023
Executive Vice President
Chief Financial Officer
(563) 589-1994
bmckeag@htlf.com

HEARTLAND FINANCIAL USA, INC. ("HTLF") REPORTS ANNUAL EARNINGS AND FOURTH QUARTER RESULTS AS OF DECEMBER 31, 2022

Highlights
§Quarterly net income available to common stockholders of $58.6 million or $1.37 per diluted common share
§Annual net income available to common stockholders of $204.1 million or $4.79 per diluted common share
§Quarterly loan growth of $504.8 million or 5%
§
Annual loan growth of $1.47 billion or 15%. Excluding decreases in Paycheck Protection Program ("PPP") loans, annual loan growth was $1.66 billion or 17%.
§Total revenue growth during the quarter of $10.1 million or 5% and $37.0 million or 5% during the year
§Nonperforming assets to total assets declined to 0.33% and 30-89 day loan delinquencies fell to 0.04% of total loans for the fourth quarter
§Net loan recoveries for the quarter of $1.7 million
§Completed the consolidation of two bank charters during the fourth quarter for a total five charter consolidations completed in 2022
Quarter Ended
December 31,		Year Ended December 31,
2022202120222021
Net income available to common stockholders (in millions)$58.6 $47.6 $204.1 $211.9 
Diluted earnings per common share1.37 1.12 4.79 5.00 
Return on average assets1.21 %1.03 %1.08 %1.19 %
Return on average common equity15.02 9.15 11.74 10.49 
Return on average tangible common equity (non-GAAP)(1)
25.19 13.47 18.56 15.59 
Net interest margin3.61 3.08 3.32 3.29 
Net interest margin, fully tax-equivalent (non-GAAP)(1)
3.65 3.12 3.37 3.33 
Efficiency ratio, fully-tax equivalent (non-GAAP)(1)
54.33 63.86 57.74 59.48 
(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 delivered strong fourth quarter and full year results while executing our strategic plans for driving organic growth, improving customer experience and consolidating charters. We continue to demonstrate strong momentum, passing $20 billion in total assets and delivering a record $726.5 million in total revenue for 2022."
Bruce K. Lee, president and chief executive officer, HTLF


Denver, Monday, January 30, 2023-Heartland Financial USA, Inc. (NASDAQ: HTLF) today reported the following results for the quarter ended December 31, 2022 compared to the quarter ended December 31, 2021:
•Net income available to common stockholders of $58.6 million compared to $47.6 million, an increase of $11.1 million or 23%.
•Earnings per diluted common share of $1.37 compared to $1.12, an increase of $0.25 or 22%.
•Net interest income of $165.2 million compared to $137.2 million, an increase of $28.0 million or 20%.
•Return on average assets of 1.21% compared to 1.03%.
•Return on average common equity of 15.02% compared to 9.15%.
•Return on average tangible common equity (non-GAAP) of 25.19% compared to 13.47%.

HTLF reported the following results for the year ended December 31, 2022 compared to the year ended December 31, 2021:
•Net income available to common stockholders of $204.1 million compared to $211.9 million, a decrease of $7.7 million or 4%.
•Earnings per diluted common share of $4.79 compared to $5.00, a decrease of $0.21 or 4%.
•Net interest income of $598.2 million compared to $560.6 million, an increase of $37.7 million or 7%.
•Return on average assets of 1.08% compared to 1.19%.
•Return on average common equity of 11.74% compared to 10.49%.
•Return on average tangible common equity (non-GAAP) of 18.56% compared to 15.59%.

Commenting on HTLF's 2022 results, Bruce K. Lee, HTLF’s president and chief executive officer, said, "HTLF delivered strong fourth quarter and full year results while executing our strategic plans for driving organic growth, improving customer experience and consolidating charters. We continue to demonstrate strong momentum, passing $20 billion in total assets and delivering a record $726.5 million in total revenue for 2022."

Charter Consolidation Update

During the fourth quarter of 2022, the charters of Arizona Bank & Trust and Illinois Bank & Trust were consolidated into HTLF Bank. Citywide Banks, Premier Valley Bank, Minnesota Bank & Trust, Arizona Bank & Trust and Illinois Bank & Trust are now operating as divisions of HTLF Bank. The remaining six charters are expected to be consolidated by the end of 2023. Charter consolidation follows a template that retains the current brands, local leadership and local decision making.

Consolidation restructuring costs are projected to be $19-$20 million with approximately $10 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, as well as current and future growth. HTLF realized some operating efficiency and financial benefits in the third and fourth quarters of 2022 with the completion of five charter consolidations, and total benefits are estimated to be approximately $20.0 million annually after the project is completed.

Effective December 31, 2022, the address of HTLF's headquarters was changed to Denver, Colorado, which is where HTLF Bank is headquartered.

Net Interest Income and Net Interest Margin

Net interest margin, expressed as a percentage of average earning assets, was 3.61% (3.65% on a fully tax-equivalent basis, non-GAAP) during the fourth quarter of 2022, compared to 3.08% (3.12% on a fully tax-equivalent basis, non-GAAP) during the fourth quarter of 2021.

Total interest income and average earning asset changes for the fourth quarter of 2022 compared to the fourth quarter of 2021 were:
•Total interest income was $204.7 million, which was an increase of $60.7 million or 42% from $144.0 million and primarily attributable to higher yields and an increase in average earning assets.


•Total interest income on a tax-equivalent basis was $206.9 million, which was an increase of $60.8 million or 42% from $146.0 million.
•Average earning assets increased $493.9 million or 3% to $18.18 billion compared to $17.68 billion, which was primarily attributable to loan growth.
•The average rate on earning assets increased 124 basis points to 4.52% compared to 3.28%, which was primarily due to recent increases in market interest rates and a shift in earning asset mix. Total average securities were 39% of total average earning assets compared to 44%.

Total interest expense and average interest bearing liability changes for the fourth quarter of 2022 compared to the fourth quarter of 2021 were:
•Total interest expense was $39.5 million, an increase of $32.6 million from $6.8 million, which was attributable to an increase in the average interest rate paid and an increase in average interest bearing liabilities.
•The average interest rate paid on HTLF's interest bearing liabilities increased to 1.31% compared to 0.27%, which was primarily due to recent increases in market interest rates.
•Average interest bearing deposits increased $1.65 billion or 17% to $11.31 billion from $9.66 billion which was primarily attributable to deposit growth. Total average interest bearing deposits were 65% of total average deposits compared to 59%.
•The average interest rate paid on HTLF's interest bearing deposits increased 100 basis points to 1.13% compared to 0.13%.
•Average borrowings increased $121.4 million to $670.2 million from $548.9 million. The average interest rate paid on HTLF's borrowings was 4.30% compared to 2.66%.

Net interest income increased for the fourth quarter of 2022 compared to the fourth quarter of 2021:
•Net interest income totaled $165.2 million compared to $137.2 million, which was an increase of $28.0 million or 20%.
•Net interest income on a tax-equivalent basis (non-GAAP) totaled $167.4 million compared to $139.2 million, which was an increase of $28.2 million or 20%.

Noninterest Income and Noninterest Expense

Total noninterest income was $30.0 million during the fourth quarter of 2022 compared to $32.7 million during the fourth quarter of 2021, a decrease of $2.8 million or 8%. Significant changes by noninterest income category for the fourth quarter of 2022 compared to the fourth quarter of 2021 were:
•Service charges and fees increased $2.1 million or 14% to $17.4 million from $15.3 million, which was primarily attributable to an increase in credit card revenue. Credit card revenue increased $1.3 million or 24% to $6.5 million compared to $5.2 million.
•Net securities losses totaled $153,000 compared to net securities gains of $1.6 million, which was a decrease of $1.7 million.
•Net gains of sales of loans held for sale decreased $3.3 million to $888,000 compared to $4.2 million, primarily due to a decrease of loans sold to the secondary market.

Total noninterest expense for the fourth quarter of 2022 was $117.2 million compared to $115.4 million for the same quarter of 2021, which was an increase of $1.8 million or 2%. Significant changes within the noninterest expense category for the fourth quarter of 2022 compared to the fourth quarter of 2021 were:
•Salaries and employee benefits totaled $61.6 million compared to $63.0 million, which was a decrease of $1.4 million or 2% and included lower salary expense due to a reduction of full-time equivalent employees which was partially offset by higher incentive compensation expense.
•Net losses on sales/valuation of assets totaled $2.4 million compared to $214,000, which was an increase of $2.2 million. HTLF recorded losses primarily associated with franchise optimization activities in the fourth quarter of 2022.
•Acquisition, integration and restructuring costs totaled $2.4 million compared to $2.0 million, an increase of $453,000 or 23% due to the progression of the charter consolidation project.
•Partnership investment in tax credit projects increased $698,000 or 27% to $3.2 million compared to $2.5 million. The expense is dependent upon the number and timing of tax credit projects placed into service.


•Occupancy expense decreased $377,000 or 5% to $6.9 million compared to $7.3 million, and furniture and equipment decreased $345,000 or 10% to $3.0 million from $3.4 million. These decreases are primarily attributable to the reduction in branch locations. Branch locations totaled 119 at December 31, 2022 compared to 130 at December 31, 2021.
•Other noninterest expenses totaled $15.4 million compared to $14.6 million, which was an increase of $801,000 or 5%. Credit card processing expense, which is driven by volume, totaled $4.1 million compared to $3.3 million, an increase of $794,000 or 24%.

HTLF's effective tax rate was 18.68% for the fourth quarter of 2022 compared to 17.16% for the fourth quarter of 2021. The following items impacted HTLF's fourth quarter 2022 and 2021 tax calculations:
•Solar energy tax credits of $2.5 million in each quarterly calculation.
•Federal low-income housing tax credits of $263,000 and $135,000.
•New markets tax credits of $75,000 in each quarterly calculation.
•Historic rehabilitation tax credits of $842,000 and $272,000.
•Tax-exempt interest income as a percentage of pre-tax income of 11.80% compared to 9.86%.
•Tax benefits of $165,000 and $491,000 related to the release of valuation allowances on deferred tax assets.

For the years ended December 31, 2022 and 2021, HTLF's effective tax rate was 20.76% and 20.10%, respectively.

Total Assets, Total Loans and Total Deposits

Total assets were $20.24 billion at December 31, 2022, an increase of $969.7 million or 5% from $19.27 billion at year-end 2021. Securities represented 35% and 40% of total assets at December 31, 2022, and December 31, 2021, respectively.

Total loans held to maturity were $11.43 billion at December 31, 2022, compared to $10.92 billion at September 30, 2022 and $9.95 billion at December 31, 2021. Excluding total PPP loans, loans increased $507.3 million or 5% during the fourth quarter of 2022 and $1.66 billion or 17% since year-end 2021.

Significant changes by loan category at December 31, 2022 compared to September 30, 2022 included:
•Commercial and business lending, which includes commercial and industrial PPP, and owner occupied commercial real estate loans, increased $162.6 million or 3% to $5.74 billion at December 31, 2022, compared to $5.58 billion at September 30, 2022.
•PPP loans originated in 2020 ("PPP I") loans decreased $423,000 or 23%. PPP loans originated in 2021 ("PPP II") decreased $2.1 million or 18%.
•Excluding total PPP loans, commercial and business lending increased $165.0 million or 3% to $5.73 billion from $5.56 billion.
•Commercial real estate lending, which includes non-owner occupied commercial real estate and construction loans, increased $191.5 million or 6% to $3.41 billion from $3.22 billion.
•Agricultural and agricultural real estate loans totaled $920.5 million compared to $781.4 million, an increase of $139.2 million or 18%.
•Consumer loans increased $11.2 million or 2% to $506.7 million from $495.5 million.

Significant changes by loan category at December 31, 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 $655.4 million or 13% to $5.74 billion at December 31, 2022, compared to $5.09 billion at December 31, 2021.
•PPP I loans decreased $25.7 million or 95%. PPP II loans decreased $163.2 million or 94%.
•Excluding total PPP loans, commercial and business lending increased $844.3 million or 17% to $5.73 billion from $4.89 billion.
•Commercial real estate lending, which includes non-owner occupied commercial real estate and construction loans, increased $540.3 million or 19% to $3.41 billion from $2.87 billion.


•Agricultural and agricultural real estate loans totaled $920.5 million, an increase of $166.8 million or 22% from $753.8 million.
•Consumer loans increased $87.2 million or 21% to $506.7 million from $419.5 million.
Total deposits were $17.51 billion as of December 31, 2022, $17.27 billion as of September 30, 2022 and $16.42 billion at December 31, 2021. Significant deposit changes by category at December 31, 2022 compared to September 30, 2022 included:
•Demand deposits decreased $382.2 million or 6% to $5.70 billion compared to $6.08 billion.
•Savings deposits decreased $66.1 million or 1% to $9.99 billion from $10.06 billion.
•Time deposits increased $694.2 million or 62% to $1.82 billion from $1.12 billion.

Significant deposit changes by category at December 31, 2022 compared to December 31, 2021 included:
•Demand deposits decreased $794.0 million or 12% to $5.70 billion compared to $6.50 billion.
•Savings deposits increased $1.10 billion or 12% to $9.99 billion from $8.90 billion. The increase was primarily attributable in an increase of $855.6 million in wholesale funding deposits, which totaled $1.09 billion at December 31, 2022 compared to $235.0 million at December 31, 2021.
•Time deposits increased $793.3 million or 77% to $1.82 billion from $1.02 billion.

The increase in time deposits for both the fourth quarter of 2022 and for the year ended December 31, 2022, was primarily attributable to an increase in wholesale funding time deposits, which totaled $965.7 million at December 31, 2022, compared to $150.0 million at September 30, 2022, and $0 at December 31, 2021.

Provision and Allowance

Provision and Allowance for Credit Losses for Loans
Provision for credit losses for loans for the fourth quarter of 2022 was $2.1 million, which was an increase of $8.9 million from $6.8 million of provision benefit recorded in the fourth quarter of 2021. The provision expense for the fourth quarter of 2022 was impacted by strong quarterly loan growth, net recoveries of $1.7 million, and healthy current credit performance. Management utilized a macroeconomic outlook in the estimation of the allowance for credit losses that anticipates a moderate recession developing within the next twelve months. The provision benefit recorded in the fourth quarter of 2021 reflected an improving credit environment and macroeconomic outlook.

HTLF's allowance for credit losses for loans totaled $109.5 million at December 31, 2022, compared to $110.1 million at December 31, 2021. The following items have impacted HTLF's allowance for credit losses for loans for the year ended December 31, 2022:
•Provision expense for the year ended December 31, 2022, totaled $10.6 million.
•Net charge offs of $11.2 million were recorded for the year or 0.11% of average loans.

Provision and Allowance for Credit Losses for Unfunded Commitments
HTLF's allowance for unfunded commitments totaled $20.2 million and $15.5 million at December 31, 2022 and December 31, 2021. The following impacted HTLF's allowance for credit losses for unfunded commitments during 2022:
•Provision expense for the year ended December 31, 2022, totaled $4.7 million.
•Unfunded commitments increased $899.5 million or 23% to $4.73 billion at December 31, 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 $3.4 million for the fourth quarter of 2022 compared to provision benefit of $5.3 million for the fourth quarter of 2021. The total allowance for lending related credit losses was $129.7 million at December 31, 2022, which was 1.13% of total loans as of December 31, 2022, compared to $125.6 million or 1.26% of total loans as of December 31, 2021.



Nonperforming Assets

Nonperforming assets decreased $5.0 million or 7% to $66.9 million, which was 0.33% of total assets at December 31, 2022, compared to $71.9 million or 0.37% of total assets at December 31, 2021. Nonperforming loans were $58.5 million or 0.51% of total loans at December 31, 2022, compared to $69.9 million or 0.70% of total loans at December 31, 2020. At December 31, 2022, loans delinquent 30-89 days were 0.04% 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.
•Annualized ratio of core expenses to average assets adjusts noninterest expenses to exclude specific items noted in the reconciliation. Management includes this measure as it is considered to be a critical metric to analyze and evaluate controllable expenses related to primary business operations.

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 January 29, 2024, by logging on to www.htlf.com.



About HTLF

Heartland Financial USA, Inc., operating under the brand name HTLF, is a bank holding company with assets of $20.24 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), and future oral and written statements of the company 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 the company'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 the company's operations or performance. These forward-looking statements are generally identified by the use of the words such as "believe", "expect", "intent", "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 the company and its management. Although the company may make these statements based on management’s experience, beliefs, expectations, assumptions and best estimate of future events, the ability of the company 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 the company 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 the company’s Annual Report on Form 10-K for the year ended December 31, 2021, include, among others:
•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, pandemics, persistent inflation, supply chain issues, labor shortages, 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, rising interest rates 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 competitive forces impacting our business and strategic acquisition risks;
•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 the company’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 the company’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. The company does not undertake and specifically disclaims any obligation to publicly release the


results of any revisions which may be made to or correct or update 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 the company’s financial results, is included in the company’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
December 31,		For the Year Ended
December 31,
2022202120222021
Interest Income
Interest and fees on loans$143,970 $107,721 $477,970 $444,137 
Interest on securities:
Taxable53,178 30,637 169,544 125,010 
Nontaxable6,132 5,595 24,006 19,268 
Interest on federal funds sold11 — 11 1 
Interest on deposits with other banks and short-term investments 1,410 86 3,125 344 
Total Interest Income204,701 144,039 674,656 588,760 
Interest Expense
Interest on deposits32,215 3,168 56,880 14,797 
Interest on short-term borrowings2,223 123 2,717 471 
Interest on other borrowings5,043 3,554 16,823 12,932 
Total Interest Expense39,481 6,845 76,420 28,200 
Net Interest Income165,220 137,194 598,236 560,560 
Provision (benefit) for credit losses3,387 (5,313)15,370 (17,575)
Net Interest Income After Provision for Credit Losses161,833 142,507 582,866 578,135 
Noninterest Income
Service charges and fees17,432 15,349 68,031 59,703 
Loan servicing income790 781 2,741 3,276 
Trust fees5,440 6,380 22,570 24,417 
Brokerage and insurance commissions629 962 2,986 3,546 
Securities gains (losses), net(153)1,563 (425)5,910 
Unrealized gain (loss) on equity securities, net(7)(27)(622)58 
Net gains on sale of loans held for sale888 4,151 9,032 20,605 
Valuation adjustment on servicing rights— 502 1,658 1,088 
Income on bank owned life insurance600 1,056 2,341 3,762 
Other noninterest income4,356 2,013 19,952 6,570 
Total Noninterest Income29,975 32,730 128,264 128,935 
Noninterest Expense
Salaries and employee benefits61,611 63,031 254,478 240,114 
Occupancy6,905 7,282 28,155 29,965 
Furniture and equipment3,019 3,364 12,499 13,323 
Professional fees18,186 17,631 65,606 64,600 
Advertising1,829 2,218 6,221 7,257 
Core deposit and customer relationship intangibles amortization1,841 2,169 7,834 9,395 
Other real estate and loan collection expenses, net373 363 950 990 
(Gain) loss on sales/valuations of assets, net2,388 214 (1,047)588 
Acquisition, integration and restructuring costs2,442 1,989 7,586 5,331 
Partnership investment in tax credit projects3,247 2,549 5,040 6,303 
Other noninterest expenses15,377 14,576 56,055 53,946 
Total Noninterest Expense117,218 115,386 443,377 431,812 
Income Before Income Taxes74,590 59,851 267,753 275,258 
Income taxes13,936 10,271 55,573 55,335 
Net Income60,654 49,580 212,180 219,923 
Preferred dividends(2,012)(2,012)(8,050)(8,050)
Net Income Available to Common Stockholders$58,642 $47,568 $204,130 $211,873 
Earnings per common share-diluted$1.37 $1.12 $4.79 $5.00 
Weighted average shares outstanding-diluted42,699,752 42,479,442 42,630,703 42,410,611 



HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
For the Quarter Ended
12/31/20229/30/20226/30/20223/31/202212/31/2021
Interest Income
Interest and fees on loans$143,970 $122,913 $108,718 $102,369 $107,721 
Interest on securities:
Taxable53,178 45,648 38,098 32,620 30,637 
Nontaxable6,132 6,164 5,508 6,202 5,595 
Interest on federal funds sold11 — — — — 
Interest on deposits with other banks and short-term investments 1,410 1,081 563 71 86 
Total Interest Income204,701 175,806 152,887 141,262 144,039 
Interest Expense
Interest on deposits32,215 15,158 6,530 2,977 3,168 
Interest on short-term borrowings2,223 360 88 46 123 
Interest on other borrowings5,043 4,412 3,808 3,560 3,554 
Total Interest Expense39,481 19,930 10,426 6,583 6,845 
Net Interest Income165,220 155,876 142,461 134,679 137,194 
Provision (benefit) for credit losses3,387 5,492 3,246 3,245 (5,313)
Net Interest Income After Provision for Credit Losses161,833 150,384 139,215 131,434 142,507 
Noninterest Income
Service charges and fees17,432 17,282 18,066 15,251 15,349 
Loan servicing income790 831 834 286 781 
Trust fees5,440 5,372 5,679 6,079 6,380 
Brokerage and insurance commissions629 649 839 869 962 
Securities gains (losses), net(153)(1,055)(2,089)2,872 1,563 
Unrealized gain (loss) on equity securities, net(7)(211)(121)(283)(27)
Net gains on sale of loans held for sale888 1,832 2,901 3,411 4,151 
Valuation adjustment on servicing rights— — — 1,658 502 
Income on bank owned life insurance600 694 523 524 1,056 
Other noninterest income4,356 3,787 7,907 3,902 2,013 
Total Noninterest Income29,975 29,181 34,539 34,569 32,730 
Noninterest Expense
Salaries and employee benefits61,611 62,661 64,032 66,174 63,031 
Occupancy6,905 6,794 7,094 7,362 7,282 
Furniture and equipment3,019 2,928 3,033 3,519 3,364 
Professional fees18,186 16,277 15,987 15,156 17,631 
Advertising1,829 1,554 1,283 1,555 2,218 
Core deposit and customer relationship intangibles amortization1,841 1,856 2,083 2,054 2,169 
Other real estate and loan collection expenses, net373 304 78 195 363 
(Gain) loss on sales/valuations of assets, net2,388 (251)(3,230)46 214 
Acquisition, integration and restructuring costs2,442 2,156 2,412 576 1,989 
Partnership investment in tax credit projects3,247 979 737 77 2,549 
Other noninterest expenses15,377 13,625 12,970 14,083 14,576 
Total Noninterest Expense117,218 108,883 106,479 110,797 115,386 
Income Before Income Taxes74,590 70,682 67,275 55,206 59,851 
Income taxes13,936 14,118 15,402 12,117 10,271 
Net Income60,654 56,564 51,873 43,089 49,580 
Preferred dividends(2,012)(2,013)(2,012)(2,013)(2,012)
Net Income Available to Common Stockholders$58,642 $54,551 $49,861 $41,076 $47,568 
Earnings per common share-diluted$1.37 $1.28 $1.17 $0.97 $1.12 
Weighted average shares outstanding-diluted42,699,752 42,643,940 42,565,391 42,540,953 42,479,442 



HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
As of
12/31/20229/30/20226/30/20223/31/202212/31/2021
Assets
Cash and due from banks$309,045 $250,394 $221,077 $198,559 $163,895 
Interest bearing deposits with other banks and other short-term investments54,042 149,466 163,717 406,343 271,704 
Cash and cash equivalents363,087 399,860 384,794 604,902 435,599 
Time deposits in other financial institutions1,740 1,740 1,855 2,894 2,894 
Securities:
Carried at fair value6,147,144 6,060,331 7,106,218 7,025,243 7,530,374 
Held to maturity, at cost829,403 830,247 81,939 81,785 84,709 
Other investments, at cost74,567 80,286 85,899 82,751 82,567 
Loans held for sale5,277 9,570 18,803 22,685 21,640 
Loans:
Held to maturity11,428,352 10,923,532 10,678,218 10,177,385 9,954,572 
 Allowance for credit losses(109,483)(105,715)(101,353)(100,522)(110,088)
Loans, net11,318,869 10,817,817 10,576,865 10,076,863 9,844,484 
Premises, furniture and equipment, net197,330 203,585 206,818 213,752 215,827 
Goodwill576,005 576,005 576,005 576,005 576,005 
Core deposit and customer relationship intangibles, net25,154 26,995 28,851 30,934 32,988 
Servicing rights, net7,840 8,379 8,288 8,102 6,890 
Cash surrender value on life insurance193,403 193,184 192,474 192,267 191,722 
Other real estate, net8,401 8,030 4,528 1,422 1,927 
Other assets496,008 466,921 385,062 311,274 246,923 
Total Assets$20,244,228 $19,682,950 $19,658,399 $19,230,879 $19,274,549 
Liabilities and Equity
Liabilities
Deposits:
 Demand$5,701,340 $6,083,563 $6,087,304 $6,376,249 $6,495,326 
 Savings9,994,391 10,060,523 10,059,678 9,236,427 8,897,909 
 Time1,817,278 1,123,035 1,078,568 1,054,008 1,024,020 
Total deposits17,513,009 17,267,121 17,225,550 16,666,684 16,417,255 
Short-term borrowings376,117 147,000 97,749 107,372 131,597 
Other borrowings371,753 371,446 372,538 372,290 372,072 
Accrued expenses and other liabilities248,294 241,425 188,494 152,676 171,447 
Total Liabilities18,509,173 18,026,992 17,884,331 17,299,022 17,092,371 
Stockholders' Equity
Preferred equity110,705 110,705 110,705 110,705 110,705 
Common stock42,467 42,444 42,439 42,370 42,275 
Capital surplus1,080,964 1,079,277 1,076,766 1,073,048 1,071,956 
Retained earnings1,120,925 1,074,168 1,031,076 992,655 962,994 
Accumulated other comprehensive income/(loss)(620,006)(650,636)(486,918)(286,921)(5,752)
Total Equity1,735,055 1,655,958 1,774,068 1,931,857 2,182,178 
Total Liabilities and Equity$20,244,228 $19,682,950 $19,658,399 $19,230,879 $19,274,549 



HEARTLAND FINANCIAL USA, INC.
CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)
DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA
For the Quarter Ended
12/31/20229/30/20226/30/20223/31/202212/31/2021
Average Balances
Assets$19,913,849 $19,775,341 $19,559,091 $19,229,872 $19,151,691 
Loans, net of unearned11,117,513 10,783,135 10,477,368 10,043,594 9,886,027 
Deposits17,319,218 17,282,289 17,044,479 16,459,378 16,265,476 
Earning assets18,175,838 18,157,795 17,987,734 17,757,067 17,681,917 
Interest bearing liabilities11,980,032 11,723,026 11,575,319 10,453,400 10,207,255 
Common equity1,548,739 1,674,306 1,731,393 2,003,424 2,061,973 
Total stockholders' equity1,659,444 1,785,011 1,842,098 2,114,129 2,172,678 
Tangible common equity (non-GAAP)(1)
946,688 1,070,399 1,125,543 1,395,488 1,451,950 
Key Performance Ratios
Annualized return on average assets1.21 %1.13 %1.06 %0.91 %1.03 %
Annualized return on average common equity (GAAP)15.02 12.93 11.55 8.32 9.15 
Annualized return on average tangible common equity (non-GAAP)(1)
25.19 20.76 18.35 12.41 13.47 
Annualized ratio of net charge-offs (recoveries) to average loans(0.06)0.00 0.03 0.49 0.03 
Annualized net interest margin (GAAP)3.61 3.41 3.18 3.08 3.08 
Annualized net interest margin, fully tax-equivalent (non-GAAP)(1)
3.65 3.45 3.22 3.12 3.12 
Efficiency ratio, fully tax-equivalent (non-GAAP)(1)
54.33 55.26 57.66 64.65 63.86 
Annualized ratio of total noninterest expenses to average assets (GAAP)2.34 2.18 2.18 2.34 2.39 
Annualized ratio of core expenses to average assets (non-GAAP)(1)
2.14 2.09 2.14 2.28 2.25 

For the Quarter Ended
December 31,		For the Year Ended
December 31,
2022202120222021
Average Balances
Assets$19,913,849 $19,151,691 $19,621,839 $18,508,273 
Loans, net of unearned11,117,513 9,886,027 10,608,831 9,957,290 
Deposits17,319,218 16,265,476 17,029,398 15,679,773 
Earning assets18,175,838 17,681,917 18,021,134 17,025,088 
Interest bearing liabilities11,980,032 10,207,255 11,437,921 9,969,820 
Common equity1,548,739 2,061,973 1,738,041 2,020,200 
Total stockholders' equity1,659,444 2,172,678 1,848,746 2,130,905 
Tangible common equity (non-GAAP)(1)
946,688 1,451,950 1,133,124 1,406,641 
Key Performance Ratios
Annualized return on average assets1.21 %1.03 %1.08 %1.19 %
Annualized return on average common equity (GAAP)15.02 9.15 11.74 10.49 
Annualized return on average tangible common equity (non-GAAP)(1)
25.19 13.47 18.56 15.59 
Annualized ratio of net charge-offs (recoveries) to average loans(0.06)0.03 0.11 0.04 
Annualized net interest margin (GAAP)3.61 3.08 3.32 3.29 
Annualized net interest margin, fully tax-equivalent (non-GAAP)(1)
3.65 3.12 3.37 3.33 
Efficiency ratio, fully tax-equivalent(1)
54.33 63.86 57.74 59.48 
Annualized ratio of total noninterest expenses to average assets (GAAP)2.34 2.39 2.26 2.33 
Annualized ratio of core expenses to average assets (non-GAAP)(1)
2.14 2.25 2.16 2.22 
(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
12/31/20229/30/20226/30/20223/31/202212/31/2021
Common Share Data
Book value per common share$38.25 $36.41 $39.19 $42.98 $49.00 
Tangible book value per common share (non-GAAP)(1)
$24.09 $22.20 $24.94 $28.66 $34.59 
ASC 320 effect on book value per common share$(14.58)$(15.31)$(11.43)$(6.74)$(0.10)
Common shares outstanding, net of treasury stock42,467,394 42,444,106 42,439,439 42,369,908 42,275,264 
Tangible common equity ratio (non-GAAP)(1)
5.21 %4.94 %5.56 %6.52 %7.84 %
Other Selected Trend Information
Effective tax rate18.68 %19.97 %22.89 %21.95 %17.16 %
Full time equivalent employees2,002 2,020 2,087 2,208 2,249 
Loans Held to Maturity
Commercial and industrial$3,464,414 $3,278,703 $3,059,519 $2,814,513 $2,645,085 
Paycheck Protection Program ("PPP")11,025 13,506 23,031 74,065 199,883 
Owner occupied commercial real estate2,265,307 2,285,973 2,282,833 2,266,076 2,240,334 
Commercial and business lending5,740,746 5,578,182 5,365,383 5,154,654 5,085,302 
Non-owner occupied commercial real estate2,330,940 2,219,542 2,321,718 2,161,761 2,010,591 
Real estate construction1,076,082 996,017 845,045 842,483 856,119 
Commercial real estate lending3,407,022 3,215,559 3,166,763 3,004,244 2,866,710 
Total commercial lending9,147,768 8,793,741 8,532,146 8,158,898 7,952,012 
Agricultural and agricultural real estate920,510 781,354 836,703 766,443 753,753 
Residential mortgage853,361 852,928 845,270 825,242 829,283 
Consumer506,713 495,509 464,099 426,802 419,524 
Total loans held to maturity$11,428,352 $10,923,532 $10,678,218 $10,177,385 $9,954,572 
Total unfunded loan commitments$4,729,677 $4,664,379 $4,458,874 $4,130,316 $3,830,219 
(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
12/31/20229/30/20226/30/20223/31/202212/31/2021
Allowance for Credit Losses-Loans
Balance, beginning of period$105,715 $101,353 $100,522 $110,088 $117,533 
Provision (benefit) for credit losses2,075 4,388 1,545 2,628 (6,808)
Charge-offs(2,668)(938)(1,473)(13,217)(1,953)
Recoveries4,361 912 759 1,023 1,316 
Balance, end of period$109,483 $105,715 $101,353 $100,522 $110,088 
Allowance for Unfunded Commitments
Balance, beginning of period$18,884 $17,780 $16,079 $15,462 $13,967 
Provision for credit losses1,312 1,104 1,701 617 1,495 
Balance, end of period$20,196 $18,884 $17,780 $16,079 $15,462 
Allowance for lending related credit losses$129,679 $124,599 $119,133 $116,601 $125,550 
Provision for Credit Losses
Provision (benefit) for credit losses-loans$2,075 $4,388 $1,545 $2,628 $(6,808)
Provision for credit losses-unfunded commitments1,312 1,104 1,701 617 1,495 
Total provision (benefit) for credit losses$3,387 $5,492 $3,246 $3,245 $(5,313)
Asset Quality
Nonaccrual loans$58,231 $64,560 $62,909 $64,174 $69,369 
Loans past due ninety days or more 273 678 95 246 550 
Other real estate owned8,401 8,030 4,528 1,422 1,927 
Other repossessed assets26 — — 34 43 
Total nonperforming assets$66,931 $73,268 $67,532 $65,876 $71,889 
Performing troubled debt restructured loans$8,279 $8,047 $1,350 $882 $817 
Nonperforming Assets Activity
Balance, beginning of period$73,268 $67,532 $65,876 $71,889 $88,146 
Net loan (charge offs) recoveries1,693 (26)(714)(12,194)(637)
New nonperforming loans1,439 8,388 8,590 15,832 5,886 
Reduction of nonperforming loans(1)
(8,875)(2,015)(5,244)(8,448)(18,429)
OREO/Repossessed assets sales proceeds(594)(611)(976)(1,203)(3,077)
Balance, end of period$66,931 $73,268 $67,532 $65,876 $71,889 
Asset Quality Ratios
Ratio of nonperforming loans to total loans0.51 %0.60 %0.59 %0.63 %0.70 %
Ratio of nonperforming loans and performing trouble debt restructured loans to total loans0.58 0.67 0.60 0.64 0.71 
Ratio of nonperforming assets to total assets0.33 0.37 0.34 0.34 0.37 
Annualized ratio of net loan charge-offs (recoveries) to average loans(0.06)0.00 0.03 0.49 0.03 
Allowance for loan credit losses as a percent of loans0.96 0.97 0.95 0.99 1.11 
Allowance for lending related credit losses as a percent of loans1.13 1.14 1.12 1.15 1.26 
Allowance for loan credit losses as a percent of nonperforming loans187.14 162.05 160.87 156.04 157.45 
Loans delinquent 30-89 days as a percent of total loans0.04 0.10 0.06 0.10 0.07 
(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
December 31, 2022September 30, 2022December 31, 2021
Average
Balance		InterestRateAverage
Balance		InterestRateAverage
Balance		InterestRate
Earning Assets
Securities:
Taxable$6,122,313 $53,178 3.45 %$6,303,278 $45,648 2.87 %$6,730,511 $30,637 1.81 %
Nontaxable(1)
890,368 7,762 3.46 951,232 7,802 3.25 964,712 7,082 2.91 
Total securities7,012,681 60,940 3.45 7,254,510 53,450 2.92 7,695,223 37,719 1.94 
Interest on deposits with other banks and other short-term investments151,405 1,410 3.69 222,170 1,081 1.93 218,809 86 0.16 
Federal funds sold739 11 5.91 11 — — — — — 
Loans:(2)
Commercial and industrial(1)
3,346,843 45,290 5.37 3,182,134 37,526 4.68 2,614,685 26,465 4.02 
PPP loans12,252 397 12.86 17,859 363 8.06 302,829 8,106 10.62 
Owner occupied commercial real estate2,277,055 26,194 4.56 2,272,666 23,601 4.12 2,166,768 22,007 4.03 
Non-owner occupied commercial real estate2,286,298 29,273 5.08 2,258,424 25,895 4.55 1,996,186 21,744 4.32 
Real estate construction1,050,802 16,585 6.26 914,520 12,382 5.37 837,716 9,390 4.45 
Agricultural and agricultural real estate785,647 10,159 5.13 799,823 8,966 4.45 697,521 7,089 4.03 
Residential mortgage858,767 9,168 4.24 858,119 8,665 4.01 853,208 8,615 4.01 
Consumer499,849 7,426 5.89 479,590 6,028 4.99 417,114 4,793 4.56 
Less: allowance for credit losses-loans(106,500)— — (102,031)— — (118,142)— — 
Net loans11,011,013 144,492 5.21 10,681,104 123,426 4.58 9,767,885 108,209 4.40 
Total earning assets18,175,838 206,853 4.52 %18,157,795 177,957 3.89 %17,681,917 146,014 3.28 %
Nonearning Assets1,738,011 1,617,546 1,469,774 
Total Assets$19,913,849 $19,775,341 $19,151,691 
Interest Bearing Liabilities
Savings$9,987,692 $25,950 1.03 %$10,059,652 $12,907 0.51 %$8,609,596 $2,160 0.10 %
Time deposits1,322,094 6,265 1.88 1,156,908 2,251 0.77 1,048,785 1,008 0.38 
Short-term borrowings298,804 2,223 2.95 134,974 360 1.06 176,956 123 0.28 
Other borrowings371,442 5,043 5.39 371,492 4,412 4.71 371,918 3,554 3.79 
Total interest bearing liabilities11,980,032 39,481 1.31 %11,723,026 19,930 0.67 %10,207,255 6,845 0.27 %
Noninterest Bearing Liabilities
Noninterest bearing deposits6,009,432 6,065,729 6,607,095 
Accrued interest and other liabilities264,941 201,575 164,663 
Total noninterest bearing liabilities6,274,373 6,267,304 6,771,758 
Equity1,659,444 1,785,011 2,172,678 
Total Liabilities and Equity$19,913,849 $19,775,341 $19,151,691 
Net interest income, fully tax-equivalent (non-GAAP)(1)(3)
$167,372 $158,027 $139,169 
Net interest spread(1)
3.21 %3.22 %3.01 %
Net interest income, fully tax-equivalent (non-GAAP) to total earning assets(1)(3)
3.65 %3.45 %3.12 %
Interest bearing liabilities to earning assets65.91 %64.56 %57.73 %
(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 Year Ended
December 31, 2022December 31, 2021
Average
Balance		InterestRateAverage
Balance		InterestRate
Earning Assets
Securities:
Taxable$6,335,586 $169,544 2.68 %$6,135,732 $125,010 2.04 %
Nontaxable(1)
965,474 30,387 3.15 799,283 24,390 3.05 
Total securities7,301,060 199,931 2.74 6,935,015 149,400 2.15 
Interest bearing deposits with other banks and other short-term investments216,786 3,125 1.44 254,630 344 0.14 
Federal funds sold192 11 5.73 3,457 1 0.03 
Loans:(2)
Commercial and industrial(1)
3,070,890 140,310 4.57 2,543,514 111,473 4.38 
PPP loans50,464 6,884 13.64 734,139 40,627 5.53 
Owner occupied commercial real estate2,272,088 93,936 4.13 1,950,014 81,717 4.19 
Non-owner occupied commercial real estate2,196,922 99,202 4.52 1,969,910 87,728 4.45 
Real estate construction923,316 48,258 5.23 824,055 37,891 4.60 
Agricultural and agricultural real estate778,526 34,064 4.38 681,493 29,822 4.38 
Residential mortgage 852,541 34,276 4.02 846,573 36,768 4.34 
Consumer464,084 23,058 4.97 407,592 20,201 4.96 
Less: allowance for credit losses-loans(105,735)— — (125,304)— — 
Net loans10,503,096 479,988 4.57 9,831,986 446,227 4.54 
Total earning assets18,021,134 683,055 3.79 %17,025,088 595,972 3.50 %
Nonearning Assets1,600,705 1,483,185 
Total Assets$19,621,839 $18,508,273 
Interest Bearing Liabilities
Savings$9,737,100 $46,623 0.48 %$8,311,825 $9,063 0.11 %
Time deposits 1,160,538 10,257 0.88 1,137,097 5,734 0.50 
Short-term borrowings168,404 2,717 1.61 181,165 471 0.26 
Other borrowings371,879 16,823 4.52 339,733 12,932 3.81 
Total interest bearing liabilities11,437,921 76,420 0.67 %9,969,820 28,200 0.28 %
Noninterest Bearing Liabilities
Noninterest bearing deposits6,131,760 6,230,851 
Accrued interest and other liabilities203,412 176,697 
Total noninterest bearing liabilities6,335,172 6,407,548 
Equity1,848,746 2,130,905 
Total Liabilities and Equity$19,621,839 $18,508,273 
Net interest income, fully tax-equivalent (non-GAAP)(1)(3)
$606,635 $567,772 
Net interest spread(1)
3.12 %3.22 %
Net interest income, fully tax-equivalent (non-GAAP) to total earning assets(1)(3)
3.37 %3.33 %
Interest bearing liabilities to earning assets63.47 %58.56 %
(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
For the Quarter Ended
12/31/20229/30/20226/30/20223/31/202212/31/2021
Reconciliation of Annualized Return on Average Tangible Common Equity (non-GAAP)
Net income available to common stockholders (GAAP)$58,642 $54,551 $49,861 $41,076 $47,568 
Plus core deposit and customer relationship intangibles amortization, net of tax(1)
1,455 1,466 1,645 1,623 1,713 
Net income available to common stockholders excluding intangible amortization (non-GAAP)$60,097 $56,017 $51,506 $42,699 $49,281 
Average common equity (GAAP)$1,548,739 $1,674,306 $1,731,393 $2,003,424 $2,061,973 
Less average goodwill576,005 576,005 576,005 576,005 576,005 
Less average core deposit and customer relationship intangibles, net26,046 27,902 29,845 31,931 34,018 
Average tangible common equity (non-GAAP)$946,688 $1,070,399 $1,125,543 $1,395,488 $1,451,950 
Annualized return on average common equity (GAAP)15.02 %12.93 %11.55 %8.32 %9.15 %
Annualized return on average tangible common equity (non-GAAP)25.19 %20.76 %18.35 %12.41 %13.47 %
Reconciliation of Annualized Net Interest Margin, Fully Tax-Equivalent (non-GAAP)
Net Interest Income (GAAP)$165,220 $155,876 $142,461 $134,679 $137,194 
Plus tax-equivalent adjustment(1)
2,152 2,151 1,977 2,119 1,975 
Net interest income, fully tax-equivalent (non-GAAP)$167,372 $158,027 $144,438 $136,798 $139,169 
Average earning assets$18,175,838 $18,157,795 $17,987,734 $17,757,067 $17,681,917 
Annualized net interest margin (GAAP)3.61 %3.41 %3.18 %3.08 %3.08 %
Annualized net interest margin, fully tax-equivalent (non-GAAP)3.65 3.45 3.22 3.12 3.12 
Net purchase accounting discount amortization on loans included in annualized net interest margin0.03 0.03 0.07 0.05 0.05 
Reconciliation of Tangible Book Value Per Common Share (non-GAAP)
Common equity (GAAP)$1,624,350 $1,545,253 $1,663,363 $1,821,152 $2,071,473 
Less goodwill576,005 576,005 576,005 576,005 576,005 
Less core deposit and customer relationship intangibles, net25,154 26,995 28,851 30,934 32,988 
Tangible common equity (non-GAAP)$1,023,191 $942,253 $1,058,507 $1,214,213 $1,462,480 
Common shares outstanding, net of treasury stock42,467,394 42,444,106 42,439,439 42,369,908 42,275,264 
Common equity (book value) per share (GAAP)$38.25 $36.41 $39.19 $42.98 $49.00 
Tangible book value per common share (non-GAAP)$24.09 $22.20 $24.94 $28.66 $34.59 
Reconciliation of Tangible Common Equity Ratio (non-GAAP)
Tangible common equity (non-GAAP)$1,023,191 $942,253 $1,058,507 $1,214,213 $1,462,480 
Total assets (GAAP)$20,244,228 $19,682,950 $19,658,399 $19,230,879 $19,274,549 
Less goodwill576,005 576,005 576,005 576,005 576,005 
Less core deposit and customer relationship intangibles, net25,154 26,995 28,851 30,934 32,988 
Total tangible assets (non-GAAP)$19,643,069 $19,079,950 $19,053,543 $18,623,940 $18,665,556 
Tangible common equity ratio (non-GAAP)5.21 %4.94 %5.56 %6.52 %7.84 %
(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
12/31/20229/30/20226/30/20223/31/202212/31/2021
Net interest income (GAAP)$165,220 $155,876 $142,461 $134,679 $137,194 
Tax-equivalent adjustment(1)
2,152 2,151 1,977 2,119 1,975 
Fully tax-equivalent net interest income 167,372 158,027 144,438 136,798 139,169 
Noninterest income29,975 29,181 34,539 34,569 32,730 
Securities (gains)/losses, net153 1,055 2,089 (2,872)(1,563)
Unrealized (gain) loss on equity securities, net7 211 121 283 27 
Valuation adjustment on servicing rights— — — (1,658)(502)
Adjusted revenue (non-GAAP)$197,507 $188,474 $181,187 $167,120 $169,861 
Total noninterest expenses (GAAP)$117,218 $108,883 $106,479 $110,797 $115,386 
Less:
Core deposit and customer relationship intangibles amortization1,841 1,856 2,083 2,054 2,169 
Partnership investment in tax credit projects3,247 979 737 77 2,549 
(Gain) loss on sales/valuation of assets, net 2,388 (251)(3,230)46 214 
Acquisition, integration and restructuring costs2,442 2,156 2,412 576 1,989 
Core expenses (non-GAAP)$107,300 $104,143 $104,477 $108,044 $108,465 
Efficiency ratio, fully tax-equivalent (non-GAAP)54.33 %55.26 %57.66 %64.65 %63.86 %
Reconciliation of Annualized Ratio of Core Expenses to Average Assets (non-GAAP)
Total noninterest expenses (GAAP)$117,218 $108,883 $106,479 $110,797 $115,386 
Core expenses (non-GAAP)107,300 104,143 104,477 108,044 108,465 
Average assets$19,913,849 $19,775,341 $19,559,091 $19,229,872 $19,151,691 
Total noninterest expenses to average assets (GAAP)2.34 %2.18 %2.18 %2.34 %2.39 %
Core expenses to average assets (non-GAAP)2.14 %2.09 %2.14 %2.28 %2.25 %
Acquisition, integration and restructuring costs
Salaries and employee benefits$424 $365 $275 $340 $— 
Occupancy— — — — — 
Furniture and equipment— — — — — 
Professional fees1,587 1,480 1,779 236 1,989 
Advertising95 131 156 — — 
(Gain) loss on sales/valuations of assets, net— — — — — 
Other noninterest expenses336 180 202 — — 
Total acquisition, integration and restructuring costs$2,442 $2,156 $2,412 $576 $1,989 
After tax impact on diluted earnings per share(1)
$0.05 $0.04 $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
December 31,		For the Year Ended
December 31,
2022202120222021
Reconciliation of Annualized Return on Average Tangible Common Equity (non-GAAP)
Net income available to common stockholders (GAAP)$58,642 $47,568 $204,130 $211,873 
Plus core deposit and customer relationship intangibles amortization, net of tax(1)
1,455 1,713 6,189 7,422 
Net income available to common stockholders excluding intangible amortization (non-GAAP)$60,097 $49,281 $210,319 $219,295 
Average common equity (GAAP)$1,548,739 $2,061,973 $1,738,041 $2,020,200 
Less average goodwill576,005 576,005 576,005 576,005 
Less average core deposit and customer relationship intangibles, net26,046 34,018 28,912 37,554 
Average tangible common equity (non-GAAP)$946,688 $1,451,950 $1,133,124 $1,406,641 
Annualized return on average common equity (GAAP)15.02 %9.15 %11.74 %10.49 %
Annualized return on average tangible common equity (non-GAAP)25.19 %13.47 %18.56 %15.59 %
Reconciliation of Annualized Net Interest Margin, Fully Tax-Equivalent (non-GAAP)
Net Interest Income (GAAP)$165,220 $137,194 $598,236 $560,560 
Plus tax-equivalent adjustment(1)
2,152 1,975 8,399 7,212 
Net interest income, fully tax-equivalent (non-GAAP)$167,372 $139,169 $606,635 $567,772 
Average earning assets$18,175,838 $17,681,917 $18,021,134 $17,025,088 
Annualized net interest margin (GAAP)3.61 %3.08 %3.32 %3.29 %
Annualized net interest margin, fully tax-equivalent (non-GAAP)3.65 3.12 3.37 3.33 
Net purchase accounting discount amortization on loans included in annualized net interest margin0.03 0.05 0.04 0.09 
(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
December 31,		For the Year Ended
December 31,
Reconciliation of Efficiency Ratio (non-GAAP)2022202120222021
Net interest income (GAAP)$165,220 $137,194 $598,236 $560,560 
Tax-equivalent adjustment(1)
2,152 1,975 8,399 7,212 
Fully tax-equivalent net interest income 167,372 139,169 606,635 567,772 
Noninterest income 29,975 32,730 128,264 128,935 
Securities (gains)/losses, net153 (1,563)425 (5,910)
Unrealized (gain) loss on equity securities, net7 27 622 (58)
Valuation adjustment on servicing rights — (502)(1,658)(1,088)
Adjusted revenue (non-GAAP)$197,507 $169,861 $734,288 $689,651 
Total noninterest expenses (GAAP)$117,218 $115,386 $443,377 $431,812 
Less:
Core deposit and customer relationship intangibles amortization1,841 2,169 7,834 9,395 
Partnership investment in tax credit projects3,247 2,549 5,040 6,303 
(Gain) loss on sales/valuations of assets, net2,388 214 (1,047)588 
Acquisition, integration and restructuring costs2,442 1,989 7,586 5,331 
Core expenses (non-GAAP)$107,300 $108,465 $423,964 $410,195 
Efficiency ratio, fully tax-equivalent (non-GAAP)54.33 %63.86 %57.74 %59.48 %
Reconciliation of Annualized Ratio of Core Expenses to Average Assets (non-GAAP)
Total noninterest expenses (GAAP)$117,218 $115,386 $443,377 $431,812 
Core expenses (non-GAAP)107,300 108,465 423,964 410,195 
Average assets$19,913,849 $19,151,691 $19,621,839 $18,508,273 
Total noninterest expenses to average assets (GAAP)2.34 %2.39 %2.26 %2.33 %
Core expenses to average assets (non-GAAP)2.14 %2.25 %2.16 %2.22 %
Acquisition, integration and restructuring costs
Salaries and employee benefits$424 $— $1,404 $578 
Occupancy— — — 10 
Furniture and equipment— — — 655 
Professional fees1,587 1,989 5,082 2,867 
Advertising95 — 382 173 
(Gain)/loss on sales/valuations of assets, net— — — 39 
Other noninterest expenses336 — 718 1,009 
Total acquisition, integration and restructuring costs$2,442 $1,989 $7,586 $5,331 
After tax impact on diluted earnings per share(1)
$0.05 $0.05 $0.14 $0.13 
(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.