Old National Reports 43% EPS Growth from 3Q22, 10% on an Adjusted Basis¹, Driven by Commercial Loan Growth, Net Interest Margin Expansion and Expense Discipline

Provided By Globe NewsWire

Last update: Jan 24, 2023

EVANSVILLE, Ind., Jan. 24, 2023 (GLOBE NEWSWIRE) --

Old National Bancorp (NASDAQ: ONB) reports 4Q22 net income applicable to common shares of $196.7 million, diluted EPS of $0.67; $164.3 million and $0.56 on an adjusted¹ basis, respectively. Full-year net income applicable to common shares of $414.2 million, diluted EPS of $1.50; $540.9 million and $1.96 on an adjusted¹ basis, respectively.

CEO COMMENTARY:

“Old National's strong 4th quarter puts the finishing touches on a transformational year of growth marked by disciplined, consistent execution,” said CEO Jim Ryan. “We capped off 2022 with robust loan growth, impressive net interest margin expansion, peer leading return on average tangible common equity, excellent credit metrics and a record efficiency ratio."

FOURTH QUARTER HIGHLIGHTS²:

Net Income	Net income applicable to common shares of $196.7 million; adjusted net income applicable to common shares¹ of $164.3 million
	Earnings per diluted common share ("EPS") of $0.67; adjusted EPS¹ of $0.56

Net Interest Income/NIM	Net interest income on a fully taxable equivalent basis¹ of $396.5 million
	Net interest margin on a fully taxable equivalent basis¹ ("NIM") of 3.85%, up 14 basis points ("bps")

Operating Performance	Pre-provision net revenue¹ (“PPNR”) of $278.8 million; adjusted PPNR¹ of $240.7 million
	Noninterest expense of $282.7 million; adjusted noninterest expense¹ of $230.3 million
	Efficiency ratio¹ of 49.1%; adjusted efficiency ratio¹of 47.5%

Loans and Credit Quality	End-of-period total loans³ of $31.1 billion, up 7.7% annualized compared to September 30, 2022
		Total commercial loans increased 7.9% annualized
		Total consumer loans⁴ increased 7.5% annualized
	Total commercial production of $2.7 billion
	Commercial loan pipeline of $4.6 billion
	Provision for credit losses⁵ ("provision") of $11.4 million
	Net charge-offs of $4.0 million, or 5 bps of average loans
	Non-performing loans of 0.81% of total loans

Return Profile & Capital	Return on average tangible common equity¹ of 31.5%; adjusted return on average tangible common equity¹ of 26.5%

Notable Items	$90.7 million gain on sale of health savings accounts
	$26.8 million of property optimization charges
	$20.3 million of merger-related charges
	$5.3 million of amortization of tax credit investments

¹Non-GAAP financial measure that management believes is useful in evaluating the financial results of the Company – refer to the Non-GAAP reconciliations contained in this release ²Comparisons are on a linked-quarter basis, unless otherwise noted ³Includes loans held for sale ⁴Includes consumer and residential real estate loans ⁵ Includes the provision for unfunded commitments

RESULTS OF OPERATIONS
Old National Bancorp ("Old National") reported fourth quarter 2022 net income applicable to common shares of $196.7 million, or $0.67 per diluted common share.

Included in the fourth quarter was a $90.7 million pre-tax gain on the November 18, 2022 sale of health savings accounts, as well as pre-tax charges of $26.8 million for property optimization and $20.3 million related to the February 15, 2022 merger with First Midwest. Excluding these transactions and realized debt securities losses from the current quarter, adjusted net income was $164.3 million, or $0.56 per diluted common share.

LOANS
Robust broad-based commercial and consumer loan growth.

Period-end total loans³ were $31.1 billion at December 31, 2022, up 7.7% annualized from $30.5 billion at September 30, 2022, driven by strong commercial loan growth of 7.9%.
Total commercial loan production in the fourth quarter was $2.7 billion; period-end commercial pipeline totaled $4.6 billion.
Total consumer loans⁴ were $9.2 billion at December 31, 2022, up 7.5% annualized from September 30, 2022.
- Consumer loans decreased $25.4 million, or 3.7% annualized, and residential mortgage loans grew $193.1 million, or 12.3% annualized, driven by strong production.
Average total loans in the fourth quarter were $30.7 billion, an increase of $838.0 million from the third quarter of 2022.

DEPOSITS
Strong deposit franchise impacted by the sale of health savings accounts and seasonal deposit outflows late in the quarter.

On average, total deposits for the fourth quarter were $35.4 billion, a decrease of 0.9% excluding $382 million of health savings accounts sold in November.
Period-end total deposits were $35.0 billion at December 31, 2022, compared to $36.1 billion at September 30, 2022, down due to the sale of health savings accounts, client deployment of excess liquidity and seasonal deposit outflows.

NET INTEREST INCOME AND MARGIN
Strong loan growth and the higher rate environment favorably impact net interest income and margin.

Net interest income on a fully taxable equivalent basis increased to $396.5 million in the fourth quarter of 2022 compared to $381.5 million in the third quarter of 2022, driven by higher interest rates and loan growth, partially offset by lower accretion income on loans.
Net interest margin on a fully taxable equivalent basis increased 14 bps to 3.85% compared to 3.71% for the third quarter of 2022.
Accretion income on loans and borrowings was $10.4 million, or 10 bps of net interest margin, in the fourth quarter of 2022 compared to $25.4 million, or 25 bps of net interest margin, in the third quarter of 2022.
Cost of total deposits was 0.34%, increasing 22 bps and the cost of total interest-bearing deposits increased 34 bps to 0.52% in the fourth quarter of 2022.

CREDIT QUALITY
Strong credit quality continues to be a hallmark of the Old National franchise.

Provision⁵ expense in the fourth quarter of 2022 was $11.4 million, compared to $15.5 million in the third quarter of 2022, reflecting strong loan and unfunded commitment growth.
Net charge-offs in the fourth quarter were $4.0 million, or 5 bps of average loans compared to net charge-offs of $7.6 million in the third quarter of 2022, or 10 bps of average loans.
- Excluding purchased credit deteriorated ("PCD") loans that had an allowance for credit losses established at acquisition, net charge-offs to average loans were 5 bps and 2 bps for the fourth and third quarters of 2022, respectively.
30+ day delinquencies were 0.19% at the end of the fourth quarter, compared to 0.22% at the end of the third quarter.
Non-performing loans as a percentage of total loans were 0.81% consistent with the third quarter of 2022.
Loans acquired from previous acquisitions were recorded at fair value at the acquisition date. As of December 31, 2022, the remaining discount on these acquired loans was $102 million.
The allowance for credit losses, including the allowance for credit losses on unfunded commitments, stood at $335.9 million, or 1.08% of total loans at December 31, 2022, consistent with September 30, 2022.

NONINTEREST INCOME
Decrease driven by lower capital markets, mortgage fees and service charges.

Total noninterest income for the fourth quarter of 2022 was $165.0 million and included a $90.7 million pre-tax gain on the sale of health savings accounts.
Excluding this item and realized debt securities losses, adjusted noninterest income for the fourth quarter was $74.5 million, compared to $80.6 million for the third quarter of 2022, down due primarily to lower capital markets income, service charge program enhancements and the sale of health savings accounts. In addition, mortgage banking revenue continues to be impacted by the higher rate environment, as well as lower production and gain on sale margins.

NONINTEREST EXPENSE
Disciplined expense management; merger cost savings fully achieved in the fourth quarter of 2022 (annualized).

Noninterest expense for the fourth quarter of 2022 was $282.7 million and included $26.8 million for property optimization, $20.3 million of merger-related charges, and $5.3 million of tax credit amortization.
Excluding these items, adjusted noninterest expense for the fourth quarter was $230.3 million, compared to $237.0 million for the third quarter of 2022, down due primarily to fully achieved merger cost saves in the fourth quarter of 2022 annualized, partly offset by performance-driven incentive accrual true-up.
The fourth quarter efficiency ratio¹ was 49.1%, while the adjusted efficiency ratio¹ was 47.5% for the fourth quarter of 2022 compared to 55.3% and 49.8%, respectively, for the third quarter of 2022.

INCOME TAXES

Income tax expense in the fourth quarter of 2022 was $61.3 million, resulting in an effective tax rate of 23.4% compared to 21.7% in the third quarter of 2022. On an adjusted fully taxable equivalent ("FTE") basis, the effective tax rate was 24.8% in the fourth quarter compared to 25.3% in the third quarter.
Income tax expense included $6.1 million of tax credit benefit.

CAPITAL AND LIQUIDITY
Capital ratios remain strong.

Preliminary total risk-based capital was 12.02% and preliminary regulatory Tier 1 capital was 10.71%, impacted by retained earnings including the $90.7 million pre-tax gain on the sale of health savings accounts, partly offset by strong loan growth. In addition, total risk-based capital was impacted by the phase-out of $2.4 million of Tier 2 subordinated debt.
Tangible common equity to tangible assets was 6.18% at the end of the fourth quarter compared to 5.82% in the third quarter of 2022, impacted by the $90.7 million pre-tax gain on the sale of health savings accounts.
The Company did not repurchase any shares of common stock during the quarter.
A loan to deposit ratio of 89.0%, combined with existing funding sources plus available unencumbered, high-quality collateral, provides strong liquidity.

HEALTH SAVINGS ACCOUNTS SALE
On November 18, 2022, Old National Bank, a wholly-owned subsidiary of Old National Bancorp, completed its previously announced transaction with UMB Bank, n.a. (“UMB”), pursuant to which UMB acquired Old National Bank’s business of acting as a qualified custodian for, and administering, health savings accounts, which totaled $382 million. Upon completion, Old National Bank recorded a pre-tax gain of $90.7 million that is recorded in noninterest income.

PROPERTY OPTIMIZATION
During the fourth quarter of 2022, Old National initiated certain property optimization actions that included the closure and consolidation of certain branches as well as other real estate repositioning across our footprint. These actions resulted in pre-tax charges of $26.8 million for the fourth quarter of 2022 that are associated with valuation adjustments related to these locations and are recorded in noninterest expense.

SERVICE CHARGE PROGRAM ENHANCEMENTS
In early December, Old National implemented several enhancements to its overdraft protection programs to provide clients with more flexibility. The changes included the elimination of the non-sufficient fund ("NSF") fee when an item is returned, among other modifications that benefit consumers.

CONFERENCE CALL AND WEBCAST
Old National will host a conference call and live webcast at 9:00 a.m. Central Time on Tuesday, January 24, 2023, to review fourth quarter and full year 2022 financial results. The live audio webcast link and corresponding presentation slides will be available on the Company’s Investor Relations web page at oldnational.com and will be archived there for 12 months. To listen to the live conference call, dial U.S. (844) 200-6205 or International (929) 526-1599, Access code 379396. A replay of the call will also be available from noon Central Time on January 24, 2023 through February 7, 2023. To access the replay, dial U.S. (866) 813-9403 or international +44 (204) 525-0658, Access code 104806.

ABOUT OLD NATIONAL
Old National Bancorp (NASDAQ: ONB) is the holding company of Old National Bank which is the sixth largest commercial bank headquartered in the Midwest. With approximately $47 billion of assets and $28 billion of assets under management, Old National ranks among the top 35 banking companies headquartered in the U.S. and has been recognized as a World’s Most Ethical Company by the Ethisphere Institute for 11 consecutive years. Since its founding, Old National Bank has focused on community banking by building long-term, highly valued partnerships with clients and in the communities it serves. In addition to providing extensive services in retail and commercial banking, Old National offers comprehensive wealth management, investment, and capital market services. For more information and financial data, please visit Investor Relations at oldnational.com.

USE OF NON-GAAP FINANCIAL MEASURES
The Company's accounting and reporting policies conform to U.S. generally accepted accounting principles ("GAAP") and general practices within the banking industry. As a supplement to GAAP, the Company provides non-GAAP performance results, which the Company believes are useful because they assist investors in assessing the Company's operating performance. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in the tables at the end of this release.

The Company presents EPS, the efficiency ratio, return on average common equity, and return on average tangible common equity, all adjusted for certain notable items. These items include the current expected credit loss ("CECL") Day 1 non-PCD provision expense, merger related charges associated with completed acquisitions, gain on sale of health savings accounts, property optimization charges, net securities gains and ONB Way charges. Management believes excluding these items from EPS, the efficiency ratio, return on average common equity, and return on average tangible common equity may be useful in assessing the Company's underlying operational performance since these items do not pertain to its core business operations and their exclusion may facilitate better comparability between periods. Management believes that excluding merger related charges and the CECL Day 1 non-PCD provision expense from these metrics may be useful to the Company, as well as analysts and investors, since these expenses can vary significantly based on the size, type, and structure of each acquisition. Additionally, management believes excluding these items from these metrics may enhance comparability for peer comparison purposes.

Income tax expense, provision for credit losses, and the certain notable items listed above are excluded from the calculation of pre-provision net revenues, adjusted due to the fluctuation in income before income tax and the level of provision for credit losses required. Management believes pre-provision net revenues, adjusted may be useful in assessing the Company's underlying operating performance and their exclusion may facilitate better comparability between periods and for peer comparison purposes.

The Company presents adjusted noninterest expense, which excludes merger related charges, property optimization charges, amortization of tax credit investments and ONB Way charges, as well as adjusted noninterest income, which excludes the gain on sale of health savings accounts and gains/losses on sales of debt securities. Management believes that excluding these items from noninterest expense and noninterest income may be useful in assessing the Company’s underlying operational performance as these items either do not pertain to its core business operations or their exclusion may facilitate better comparability between periods and for peer comparison purposes.

The tax-equivalent adjustment to net interest income and net interest margin recognizes the income tax savings when comparing taxable and tax-exempt assets. Interest income and yields on tax-exempt securities and loans are presented using the current federal income tax rate of 21%. Management believes that it is standard practice in the banking industry to present net interest income and net interest margin on a fully tax-equivalent basis and that it may enhance comparability for peer comparison purposes.

In management's view, tangible common equity measures are capital adequacy metrics that may be meaningful to the Company, as well as analysts and investors, in assessing the Company's use of equity and in facilitating comparisons with peers. These non-GAAP measures are valuable indicators of a financial institution's capital strength since they eliminate intangible assets from stockholders' equity and retain the effect of accumulated other comprehensive loss in stockholders' equity.

Although intended to enhance investors' understanding of the Company's business and performance, these non-GAAP financial measures should not be considered an alternative to GAAP. In addition, these non-GAAP financial measures may differ from those used by other financial institutions to assess their business and performance. See the previously provided tables and the following reconciliations in the "Non-GAAP Reconciliations" section for details on the calculation of these measures to the extent presented herein.

FORWARD-LOOKING STATEMENTS
This communication contains certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, descriptions of Old National’s financial condition, results of operations, asset and credit quality trends, profitability and business plans or opportunities. Forward-looking statements can be identified by the use of the words "anticipate," "believe," "contemplate," "could," "estimate," "expect," "intend," "may," "outlook," "plan," "should," and "will," and other words of similar meaning. These forward-looking statements express management’s current expectations or forecasts of future events and, by their nature, are subject to risks and uncertainties. There are a number of factors that could cause actual results or outcomes to differ materially from those in such statements. Factors that might cause such a difference include, but are not limited to: the continued impact of the COVID-19 pandemic on our business as well as the business of our customers; competition; government legislation, regulations and policies; the ability of Old National to execute its business plan, including the completion of the integration related to the merger between Old National and First Midwest and the achievement of the synergies and other benefits from the merger; changes in economic conditions which could materially impact credit quality trends and the ability to generate loans and gather deposits; failure or circumvention of our internal controls; significant changes in accounting, tax or regulatory practices or requirements; new legal obligations; disruptive technologies in payment systems and other services traditionally provided by banks; failure or disruption of our information systems; computer hacking and other cybersecurity threats; other matters discussed in this communication; and other factors identified in our Annual Report on Form 10-K for the year ended December 31, 2021 and other filings with the Securities and Exchange Commission. These forward-looking statements are made only as of the date of this communication and are not guarantees of future results or performance, and Old National does not undertake an obligation to update these forward-looking statements to reflect events or conditions after the date of this communication.

CONTACTS:
Media: Kathy Schoettlin		Investors: Lynell Walton
(812) 465-7269		(812) 464-1366
Kathy.Schoettlin@oldnational.com		Lynell.Walton@oldnational.com


Financial Highlights (unaudited)
($ and shares in thousands, except per share data)

	Three Months Ended															Twelve Months Ended
	December 31,			September 30,			June 30,			March 31,			December 31,			December 31,			December 31,
		2022			2022			2022			2022			2021			2022			2021
Income Statement
Net interest income	$	391,090		$	376,589		$	337,472		$	222,785		$	146,781		$	1,327,936		$	596,400
FTE adjustment¹		5,378			4,950			4,314			3,772			3,442			18,414			13,913
Net interest income - tax equivalent basis		396,468			381,539			341,786			226,557			150,223			1,346,350			610,313
Provision for credit losses²		11,408			15,490			9,165			108,736			(1,332	)		144,799			(29,622	)
Noninterest income		165,037			80,385			89,117			65,240			51,484			399,779			214,219
Noninterest expense²		282,675			262,444			277,475			215,589			131,355			1,038,183			501,379
Net income (loss) available to common shareholders	$	196,701		$	136,119		$	110,952		$	(29,603	)	$	56,188		$	414,169		$	277,538
Per Common Share Data
Weighted average diluted shares		293,131			292,483			291,881			227,002			166,128			276,688			165,929
EPS, diluted	$	0.67		$	0.47		$	0.38		$	(0.13	)	$	0.34		$	1.50		$	1.67
Cash dividends		0.14			0.14			0.14			0.14			0.14			0.56			0.56
Dividend payout ratio³		21	%		30	%		37	%	(108		)%		41	%		37	%		33	%
Book value	$	16.68		$	16.05		$	16.51		$	17.03		$	18.16		$	16.68		$	18.16
Stock price		17.98			16.47			14.79			16.38			18.12			17.98			18.12
Tangible book value⁴		9.42			8.75			9.23			9.71			11.70			9.42			11.70
Performance Ratios
ROAA		1.74	%		1.22	%		1.01	%	(0.31		)%		0.93	%		0.99	%		1.17	%
ROAE		16.8	%		11.1	%		9.1	%	(2.9		)%		7.5	%		8.9	%		9.3	%
ROATCE⁴		31.5	%		20.5	%		16.9	%	(4.0		)%		12.1	%		16.3	%		14.9	%
NIM (FTE)		3.85	%		3.71	%		3.33	%		2.88	%		2.77	%		3.47	%		2.89	%
Efficiency ratio⁴		49.1	%		55.3	%		62.7	%		72.3	%		64.0	%		58.0	%		59.7	%
Efficiency ratio (prior presentation)⁵	N/A				56.2	%		62.7	%		76.2	%		64.3	%	N/A				59.6	%
NCOs (recoveries) to average loans		0.05	%		0.10	%		0.02	%		0.05	%	(0.04		)%		0.06	%	(0.03		)%
ACL on loans to EOP loans		0.98	%		0.99	%		0.97	%		0.99	%		0.79	%		0.98	%		0.79	%
ACL⁶ to EOP loans		1.08	%		1.08	%		1.05	%		1.07	%		0.87	%		1.08	%		0.87	%
NPLs to EOP loans		0.81	%		0.81	%		0.78	%		0.88	%		0.92	%		0.81	%		0.92	%
Balance Sheet (EOP)
Total loans	$	31,123,641		$	30,528,933		$	29,553,648		$	28,336,244		$	13,601,846		$	31,123,641		$	13,601,846
Total assets		46,763,372			46,215,526			45,748,355			45,834,648			24,453,564			46,763,372			24,453,564
Total deposits		35,000,830			36,053,663			35,538,975			35,607,390			18,569,195			35,000,830			18,569,195
Total borrowed funds		5,586,314			4,264,750			4,384,411			4,347,560			2,575,240			5,586,314			2,575,240
Total shareholders' equity		5,128,595			4,943,383			5,078,783			5,232,114			3,012,018			5,128,595			3,012,018
Capital Ratios⁴
Risk-based capital ratios (EOP):
Tier 1 common equity		10.03	%		9.88	%		9.90	%		10.04	%		12.04	%		10.03	%		12.04	%
Tier 1 capital		10.71	%		10.58	%		10.63	%		10.79	%		12.04	%		10.71	%		12.04	%
Total capital		12.02	%		11.84	%		12.03	%		12.19	%		12.77	%		12.02	%		12.77	%
Leverage ratio (average assets)		8.52	%		8.26	%		8.19	%		10.58	%		8.59	%		8.52	%		8.59	%
Equity to assets (averages)		10.70	%		11.18	%		11.22	%		12.03	%		12.35	%		11.23	%		12.60	%
TCE to TA		6.18	%		5.82	%		6.20	%		6.51	%		8.30	%		6.18	%		8.30	%
Nonfinancial Data
Full-time equivalent employees		3,967			4,008			4,196			4,333			2,374			3,967			2,374
Banking centers		263			263			266			267			162			263			162
¹ Calculated using the federal statutory tax rate in effect of 21% for all periods.
² Provision for unfunded commitments is included in the provision for credit losses. The reclassification of the provision for unfunded commitments out of other expense as a component of noninterest expense was made to prior period amounts to conform to the current period presentation.
³ Cash dividends per common share divided by net income per common share (basic).
⁴ Represents a non-GAAP financial measure. Refer the "Non-GAAP Measures" table for reconciliations to GAAP financial measures. December 31, 2022 capital ratios are preliminary.
⁵ Presented as calculated prior to December 31, 2022, which included the provision for unfunded commitments in noninterest expense. Management believes that removing the provision for unfunded commitments from this metric enhances comparability for peer comparison purposes.
⁶ Includes the allowance for credit losses on loans and unfunded commitments.

FTE - Fully taxable equivalent basis ROAA - Return on average assets ROAE - Return on average equity
ROATCE - Return on average tangible common equity NCOs - Net Charge-offs ALL - Allowance for loan losses ACL - Allowance for Credit Losses EOP - End of period actual balances NPLs - Non-performing Loans TCE - Tangible common equity TA - Tangible assets


Income Statement (unaudited)
($ and shares in thousands, except per share data)
	Three Months Ended															Twelve Months Ended
	December 31,			September 30,			June 30,			March 31,			December 31,			December 31,			December 31,
		2022			2022			2022			2022			2021			2022			2021
Interest income	$	457,821		$	406,518		$	354,358		$	235,505		$	156,928		$	1,454,202		$	638,649
Less: interest expense		66,731			29,929			16,886			12,720			10,147			126,266			42,249
Net interest income		391,090			376,589			337,472			222,785			146,781			1,327,936			596,400
Provision for credit losses¹		11,408			15,490			9,165			108,736			(1,332	)		144,799			(29,622	)
Net interest income after provision		379,682			361,099			328,307			114,049			148,113			1,183,137			626,022
Wealth management fees		17,851			17,317			19,304			14,630			9,833			69,102			40,409
Service charges on deposit accounts		18,109			20,042			20,324			14,026			8,388			72,501			31,658
Debit card and ATM fees		10,798			10,608			11,222			7,599			5,804			40,227			23,766
Mortgage banking revenue		3,888			5,360			6,522			7,245			7,336			23,015			42,558
Investment product fees		7,817			8,042			8,568			7,322			6,258			31,749			24,639
Capital markets income		5,377			8,906			7,261			4,442			6,394			25,986			21,997
Company-owned life insurance		3,108			3,361			4,571			3,524			2,737			14,564			10,589
Gain on sale of health savings accounts		90,673			—			—			—			—			90,673			—
Other income		7,589			6,921			11,430			6,110			4,299			32,050			14,276
Gains (losses) on sales of debt securities		(173	)		(172	)		(85	)		342			435			(88	)		4,327
Total noninterest income		165,037			80,385			89,117			65,240			51,484			399,779			214,219
Salaries and employee benefits		142,459			147,203			161,817			124,147			72,336			575,626			284,098
Occupancy		26,488			26,418			26,496			21,019			13,151			100,421			54,834
Equipment		7,591			7,328			7,550			5,168			4,473			27,637			16,704
Marketing		8,508			10,361			9,119			4,276			4,723			32,264			12,684
Data processing		19,951			20,269			25,883			18,762			11,489			84,865			47,047
Communication		4,159			5,392			5,878			3,417			2,412			18,846			10,073
Professional fees		6,360			6,559			6,336			19,791			5,409			39,046			20,077
FDIC assessment		5,809			6,249			4,699			2,575			1,598			19,332			6,059
Amortization of intangibles		6,787			7,089			7,170			4,811			2,573			25,857			11,336
Amortization of tax credit investments		5,258			2,662			1,525			1,516			2,019			10,961			6,770
Property optimization		26,818			—			—			—			—			26,818			—
Other expense¹		22,487			22,914			21,002			10,107			11,172			76,510			31,697
Total noninterest expense		282,675			262,444			277,475			215,589			131,355			1,038,183			501,379
Income (loss) before income taxes		262,044			179,040			139,949			(36,300	)		68,242			544,733			338,862
Income tax expense (benefit)		61,309			38,887			24,964			(8,714	)		12,054			116,446			61,324
Net income (loss)	$	200,735		$	140,153		$	114,985		$	(27,586	)	$	56,188		$	428,287		$	277,538
Preferred dividends		(4,034	)		(4,034	)		(4,033	)		(2,017	)		—			(14,118	)		—
Net income (loss) applicable to common shares	$	196,701		$	136,119		$	110,952		$	(29,603	)	$	56,188		$	414,169		$	277,538

EPS	$	0.67		$	0.47		$	0.38		$	(0.13	)	$	0.34		$	1.50		$	1.67
Weighted Average Common Shares Outstanding
Basic		291,012			290,961			290,862			227,002			165,278			275,179			165,178
Diluted		293,131			292,483			291,881			227,002			166,128			276,688			165,929
Common shares outstanding (EOP)		292,903			292,880			292,893			292,959			165,838			292,903			165,838

¹ Provision for unfunded commitments is included in the provision for credit losses. The reclassification of the provision for unfunded commitments out of other expense as a component of noninterest expense was made to prior period amounts to conform to the current period presentation.


End of Period Balance Sheet (unaudited)
($ in thousands)
	December 31,			September 30,			June 30,			March 31,			December 31,
		2022			2022			2022			2022			2021
Earning Assets
Federal Reserve Bank account	$	269,374		$	328,391		$	334,570		$	1,545,389		$	627,354
Money market investments		5,606			6,374			7,774			12,419			22,002
Investments:
Treasury and government-sponsored agencies		2,195,175			2,186,551			2,461,173			2,527,568			1,778,357
Mortgage-backed securities		5,476,718			5,584,241			5,976,921			6,086,853			3,698,831
States and political subdivisions		1,827,164			1,829,561			1,839,333			1,840,823			1,654,986
Other securities		730,476			693,303			719,223			735,550			432,478
Total investments		10,229,533			10,293,656			10,996,650			11,190,794			7,564,652
Loans held for sale, at fair value		11,926			19,748			26,217			39,376			35,458
Loans:
Commercial		9,508,904			9,311,148			8,923,983			8,624,253			3,391,769
Commercial and agriculture real estate		12,457,070			12,227,888			11,796,503			11,337,735			6,380,674
Consumer:
Home equity		1,033,783			1,043,594			1,097,852			1,080,885			560,590
Other consumer loans		1,663,443			1,678,997			1,656,253			1,587,216			1,013,524
Subtotal of commercial and consumer loans		24,663,200			24,261,627			23,474,591			22,630,089			11,346,557
Residential real estate		6,460,441			6,267,306			6,079,057			5,706,155			2,255,289
Total loans		31,123,641			30,528,933			29,553,648			28,336,244			13,601,846
Total earning assets		41,640,080			41,177,102			40,918,859			41,124,222			21,851,312

Allowance for credit losses on loans		(303,671	)		(302,254	)		(288,003	)		(280,507	)		(107,341	)
Non-earning Assets:
Cash and due from banks		453,432			466,846			455,620			418,744			172,663
Premises and equipment, net		557,307			588,021			586,031			584,113			476,186
Operating lease right-of-use assets		189,714			187,626			192,196			201,802			69,560
Goodwill and other intangible assets		2,125,121			2,135,792			2,131,815			2,144,609			1,071,672
Company-owned life insurance		768,552			767,089			769,595			766,291			463,324
Other assets		1,332,837			1,195,304			982,242			875,374			456,188
Total non-earning assets		5,426,963			5,340,678			5,117,499			4,990,933			2,709,593
Total assets	$	46,763,372		$	46,215,526		$	45,748,355		$	45,834,648		$	24,453,564

Liabilities and Equity
Noninterest-bearing demand deposits	$	11,930,798		$	12,400,077		$	12,388,379		$	12,463,136		$	6,303,106
Interest-bearing:
Checking and NOW accounts		8,340,955			8,963,014			8,473,510			8,296,337			5,338,022
Savings accounts		6,326,158			6,616,512			6,796,152			6,871,767			3,798,494
Money market accounts		5,389,139			5,602,729			5,373,318			5,432,139			2,169,160
Other time deposits		2,775,991			2,393,083			2,479,304			2,544,011			960,413
Total core deposits		34,763,041			35,975,415			35,510,663			35,607,390			18,569,195
Brokered deposits		237,789			78,248			28,312			—			—
Total deposits		35,000,830			36,053,663			35,538,975			35,607,390			18,569,195

Federal funds purchased and interbank borrowings		581,489			301,031			1,561			1,721			276
Securities sold under agreements to repurchase		432,804			438,053			476,173			509,275			392,275
Federal Home Loan Bank advances		3,829,018			2,804,617			3,283,963			3,239,357			1,886,019
Other borrowings		743,003			721,049			622,714			597,207			296,670
Total borrowed funds		5,586,314			4,264,750			4,384,411			4,347,560			2,575,240
Operating lease liabilities		211,964			207,725			215,188			234,049			76,236
Accrued expenses and other liabilities		835,669			746,005			530,998			413,535			220,875
Total liabilities		41,634,777			41,272,143			40,669,572			40,602,534			21,441,546
Preferred stock, common stock, surplus, and retained earnings		5,915,017			5,751,833			5,647,916			5,570,313			3,014,393
Accumulated other comprehensive income (loss), net of tax		(786,422	)		(808,450	)		(569,133	)		(338,199	)		(2,375	)
Total shareholders' equity		5,128,595			4,943,383			5,078,783			5,232,114			3,012,018
Total liabilities and shareholders' equity	$	46,763,372		$	46,215,526		$	45,748,355		$	45,834,648		$	24,453,564


Average Balance Sheet and Interest Rates (unaudited)
($ in thousands)


	Three Months Ended								Three Months Ended							Three Months Ended
	December 31, 2022								September 30, 2022							December 31, 2021
	Average			Income¹/			Yield/		Average			Income¹/		Yield/		Average			Income¹/		Yield/
Earning Assets:	Balance			Expense			Rate		Balance			Expense		Rate		Balance			Expense		Rate
Money market and other interest-earning investments	$	324,801		$	(259	)	(0.32	)%	$	514,362		$	935	0.72	%	$	726,144		$	276	0.15	%
Investments:
Treasury and government-sponsored agencies		2,151,746			14,683		2.73	%		2,326,070			13,212	2.27	%		1,763,544			6,390	1.45	%
Mortgage-backed securities		5,470,753			35,344		2.58	%		5,891,283			36,157	2.45	%		3,513,482			15,071	1.72	%
States and political subdivisions		1,818,431			14,849		3.27	%		1,829,322			14,631	3.20	%		1,625,390			12,941	3.18	%
Other securities		702,730			7,741		4.41	%		718,735			6,781	3.77	%		438,583			2,608	2.38	%
Total investments		10,143,660			72,617		2.86	%		10,765,410			70,781	2.63	%		7,340,999			37,010	2.02	%
Loans:²
Commercial		9,330,906			132,711		5.69	%		9,045,009			113,491	5.02	%		3,420,274			31,641	3.62	%
Commercial and agriculture real estate		12,317,057			161,766		5.25	%		11,929,892			136,780	4.59	%		6,341,296			57,347	3.54	%
Consumer:
Home equity		949,925			16,926		7.07	%		947,921			14,397	6.03	%		556,851			4,380	3.12	%
Other consumer loans		1,766,527			19,906		4.47	%		1,787,929			18,652	4.14	%		1,009,690			9,488	3.73	%
Subtotal commercial and consumer loans		24,364,415			331,309		5.43	%		23,710,751			283,320	4.78	%		11,328,111			102,856	3.60	%
Residential real estate loans		6,373,819			59,532		3.74	%		6,189,503			56,432	3.65	%		2,275,469			20,228	3.56	%

Total loans		30,738,234			390,841		5.08	%		29,900,254			339,752	4.54	%		13,603,580			123,084	3.56	%

Total earning assets	$	41,206,695		$	463,199		4.49	%	$	41,180,026		$	411,468	3.99	%	$	21,670,723		$	160,370	2.93	%

Less: Allowance for credit losses on loans		(303,009	)							(290,215	)						(107,990	)

Non-earning Assets:
Cash and due from banks	$	368,874							$	503,841						$	228,126
Other assets		4,861,247								4,522,171							2,481,792

Total assets	$	46,133,807							$	45,915,823						$	24,272,651

Interest-Bearing Liabilities:
Checking and NOW accounts	$	8,482,651		$	13,189		0.62	%	$	8,681,392		$	5,751	0.26	%	$	5,093,496		$	458	0.04	%
Savings accounts		6,482,369			1,558		0.10	%		6,733,465			547	0.03	%		3,766,543			524	0.06	%
Money market accounts		5,382,254			8,091		0.60	%		5,344,567			2,072	0.15	%		2,139,702			456	0.08	%
Other time deposits		2,540,619			5,688		0.89	%		2,463,573			2,168	0.35	%		978,723			1,047	0.42	%
Total interest-bearing core deposits		22,887,893			28,526		0.49	%		23,222,997			10,538	0.18	%		11,978,464			2,485	0.08	%
Brokered deposits		129,745			1,366		4.18	%		44,579			282	2.51	%		—			—	0.00	%
Total interest-bearing deposits		23,017,638			29,892		0.52	%		23,267,576			10,820	0.18	%		11,978,464			2,485	0.08	%

Federal funds purchased and interbank borrowings		475,431			4,299		3.59	%		122,311			720	2.34	%		1,162			—	0.00	%
Securities sold under agreements to repurchase		409,916			556		0.54	%		436,225			106	0.10	%		381,744			92	0.10	%
Federal Home Loan Bank advances		3,266,896			25,609		3.11	%		3,025,844			13,027	1.71	%		1,887,821			5,122	1.08	%
Other borrowings		753,401			6,375		3.36	%		676,874			5,256	3.08	%		274,926			2,448	3.56	%
Total borrowed funds		4,905,644			36,839		2.98	%		4,261,254			19,109	1.78	%		2,545,653			7,662	1.19	%

Total interest-bearing liabilities	$	27,923,282		$	66,731		0.95	%	$	27,528,830		$	29,929	0.43	%	$	14,524,117		$	10,147	0.28	%

Noninterest-Bearing Liabilities and Shareholders' Equity
Demand deposits	$	12,373,495							$	12,575,011						$	6,435,829
Other liabilities		900,448								677,829							313,880
Shareholders' equity		4,936,582								5,134,153							2,998,825

Total liabilities and shareholders' equity	$	46,133,807							$	45,915,823						$	24,272,651

Net interest rate spread							3.54	%						3.56	%						2.65	%

Net interest margin (FTE)							3.85	%						3.71	%						2.77	%

FTE adjustment				$	5,378							$	4,950						$	3,442

¹ Interest income is reflected on a FTE.
² Includes loans held for sale.


Average Balance Sheet and Interest Rates (unaudited)
($ in thousands)


	Twelve Months Ended							Twelve Months Ended
	December 31, 2022							December 31, 2021
	Average			Income¹/		Yield/		Average			Income¹/		Yield/
Earning Assets:	Balance			Expense		Rate		Balance			Expense		Rate
Money market and other interest-earning investments	$	812,296		$	2,814	0.35	%	$	450,158		$	589	0.13	%
Investments:
Treasury and government-sponsored agencies		2,290,229			47,932	2.09	%		1,573,855			24,209	1.54	%
Mortgage-backed securities		5,562,442			129,411	2.33	%		3,356,950			60,479	1.80	%
States and political subdivisions		1,805,433			57,688	3.20	%		1,548,939			50,115	3.24	%
Other securities		687,926			24,133	3.51	%		443,606			10,680	2.41	%
Total investments	$	10,346,030		$	259,164	2.50	%	$	6,923,350		$	145,483	2.10	%
Loans:²
Commercial		8,252,237			397,228	4.81	%		3,763,099			138,063	3.67	%
Commercial and agriculture real estate		11,147,967			489,499	4.39	%		6,168,146			228,568	3.71	%
Consumer:
Home equity		921,018			49,934	5.42	%		547,322			17,181	3.14	%
Other consumer loans		1,649,337			72,340	4.39	%		1,030,145			39,100	3.80	%
Subtotal commercial and consumer loans		21,970,559			1,009,001	4.59	%		11,508,712			422,912	3.67	%
Residential real estate loans		5,622,901			201,637	3.59	%		2,269,989			83,578	3.68	%

Total loans		27,593,460			1,210,638	4.39	%		13,778,701			506,490	3.68	%

Total earning assets	$	38,751,786		$	1,472,616	3.80	%	$	21,152,209		$	652,562	3.09	%

Less: Allowance for credit losses on loans		(261,534	)						(117,436	)

Non-earning Assets:
Cash and due from banks	$	355,391						$	256,860
Other assets		4,404,057							2,492,054

Total assets	$	43,249,700						$	23,783,687

Interest-Bearing Liabilities:
Checking and NOW accounts	$	8,104,844		$	21,321	0.26	%	$	4,945,435		$	2,065	0.04	%
Savings accounts		6,342,697			3,367	0.05	%		3,648,019			2,003	0.05	%
Money market accounts		4,961,159			11,882	0.24	%		2,080,332			1,750	0.08	%
Other time deposits		2,312,935			10,801	0.47	%		1,020,359			5,105	0.50	%
Total interest-bearing core deposits		21,721,635			47,371	0.22	%		11,694,145			10,923	0.09	%
Brokered deposits		45,796			1,722	3.76	%		41,371			31	0.08	%
Total interest-bearing deposits		21,767,431			49,093	0.23	%		11,735,516			10,954	0.09	%

Federal funds purchased and interbank borrowings		151,243			5,021	3.32	%		1,113			—	0.00	%
Securities sold under agreements to repurchase		440,619			843	0.19	%		392,777			397	0.10	%
Federal Home Loan Bank advances		2,986,006			51,524	1.73	%		1,902,407			21,075	1.11	%
Other borrowings		619,659			19,785	3.19	%		269,484			9,823	3.65	%
Total borrowed funds		4,197,527			77,173	1.84	%		2,565,781			31,295	1.22	%

Total interest-bearing liabilities		25,964,958			126,266	0.49	%		14,301,297			42,249	0.30	%

Noninterest-Bearing Liabilities and Shareholders' Equity
Demand deposits	$	11,750,306						$	6,163,937
Other liabilities		676,940							320,933
Shareholders' equity		4,857,496							2,997,520

Total liabilities and shareholders' equity	$	43,249,700						$	23,783,687

Net interest rate spread						3.31	%						2.79	%

Net interest margin (FTE)						3.47	%						2.89	%

FTE adjustment				$	18,414						$	13,913

¹ Interest income is reflected on a FTE.
² Includes loans held for sale.


Asset Quality (EOP) (unaudited)
($ in thousands)

	Three Months Ended															Twelve Months Ended
	December 31,			September 30,			June 30,			March 31,			December 31,			December 31,			December 31,
		2022			2022			2022			2022			2021			2022			2021
Allowance for credit losses:
Beginning allowance for credit losses on loans	$	302,254		$	288,003		$	280,507		$	107,341		$	107,868		$	107,341		$	131,388
Allowance established for acquired PCD loans		—			10,558			—			78,531			—			89,089			—
Provision for credit losses on loans		5,389			11,288			9,254			97,409			(1,914	)		123,340			(28,812	)
Gross charge-offs		(7,081	)		(11,440	)		(4,096	)		(4,664	)		(545	)		(27,281	)		(4,310	)
Gross recoveries		3,109			3,845			2,338			1,890			1,932			11,182			9,075
(NCOs) recoveries		(3,972	)		(7,595	)		(1,758	)		(2,774	)		1,387			(16,099	)		4,765
Ending allowance for credit losses on loans	$	303,671		$	302,254		$	288,003		$	280,507		$	107,341		$	303,671		$	107,341
Beginning allowance for credit losses on unfunded commitments	$	26,169		$	21,966		$	22,046		$	10,879		$	10,297		$	10,879		$	11,689
Provision for credit losses on unfunded commitments		6,019			4,203			(80	)		11,167			582			21,309			(810	)
Ending allowance for credit losses on unfunded commitments	$	32,188		$	26,169		$	21,966		$	22,046		$	10,879		$	32,188		$	10,879
Allowance for credit losses	$	335,859		$	328,423		$	309,969		$	302,553		$	118,220		$	335,859		$	118,220
Provision for credit losses on loans	$	5,389		$	11,288		$	9,254		$	97,409		$	(1,914	)	$	123,340		$	(28,812	)
Provision for credit losses on unfunded commitments¹		6,019			4,203			(80	)		11,167			582			21,309			(810	)
Provision for credit losses¹	$	11,408		$	15,491		$	9,174		$	108,576		$	(1,332	)	$	144,649		$	(29,622	)
NCOs (recoveries) / average loans²		0.05	%		0.10	%		0.02	%		0.05	%	(0.04		)%		0.06	%	(0.03		)%
Average loans²	$	30,737,698		$	29,890,008		$	28,847,003		$	20,725,313		$	13,594,543		$	27,589,442		$	13,766,590
EOP loans²		31,123,641			30,528,933			29,553,648			28,336,244			13,601,846			31,123,641			13,601,846
ACL on loans / EOP loans²		0.98	%		0.99	%		0.97	%		0.99	%		0.79	%		0.98	%		0.79	%
ACL / EOP loans²		1.08	%		1.08	%		1.05	%		1.07	%		0.87	%		1.08	%		0.87	%
Underperforming Assets:
Loans 90 days and over (still accruing)	$	2,650		$	767		$	882		$	1,646		$	7		$	2,650		$	7
NPLs:
Nonaccrual loans³		238,178			233,659			214,924			227,925			106,691			238,178			106,691
TDRs still accruing		15,313			13,674			15,665			20,999			18,378			15,313			18,378
Total NPLs		253,491			247,333			230,589			248,924			125,069			253,491			125,069
Foreclosed assets		10,845			11,967			12,618			19,713			2,030			10,845			2,030
Total underperforming assets	$	266,986		$	260,067		$	244,089		$	270,283		$	127,106		$	266,986		$	127,106
Classified and Criticized Assets:
Nonaccrual loans³	$	238,178		$	233,659		$	214,924		$	227,925		$	106,691		$	238,178		$	106,691
Substandard loans (still accruing)		504,657			476,724			490,566			518,341			162,572			504,657			162,572
Loans 90 days and over (still accruing)		2,650			767			882			1,646			7			2,650			7
Total classified loans - "problem loans"		745,485			711,150			706,372			747,912			269,270			745,485			269,270
Other classified assets		24,735			24,773			25,004			24,676			4,338			24,735			4,338
Criticized loans - "special mention loans"		636,069			549,994			452,835			507,689			235,910			636,069			235,910
Total classified and criticized assets	$	1,406,289		$	1,285,917		$	1,184,211		$	1,280,277		$	509,518		$	1,406,289		$	509,518
Loans 30-89 days past due	$	55,522		$	65,632		$	48,889		$	94,114		$	16,347		$	55,522		$	16,347
NPLs / EOP loans²		0.81	%		0.81	%		0.78	%		0.88	%		0.92	%		0.81	%		0.92	%
ACL to NPLs		132	%		133	%		134	%		122	%		95	%		132	%		95	%
Under-performing assets/EOP loans²		0.86	%		0.85	%		0.83	%		0.95	%		0.93	%		0.86	%		0.93	%
Under-performing assets/EOP assets		0.57	%		0.56	%		0.53	%		0.59	%		0.52	%		0.57	%		0.52	%
30+ day delinquencies²		0.19	%		0.22	%		0.17	%		0.34	%		0.12	%		0.19	%		0.12	%
¹ Excludes $0.2 million of expense to establish an allowance on held-to-maturity securities during the first quarter of 2022. Provision for unfunded commitments is included in the provision for credit losses. The reclassification of the provision for unfunded commitments out of other expense as a component of noninterest expense was made to prior period amounts to conform to the current period presentation.
² Excludes loans held for sale.
³ Includes non-accruing TDRs totaling $24.0 million at December 31, 2022, $23.8 million at September 30, 2022, $24.3 million at June 30, 2022, $23.8 million at March 31, 2022 and $11.7 million at December 31, 2021.
PCD - Purchased credit deteriorated TDR - Troubled debt restructuring


Non-GAAP Measures (unaudited)
($ and shares in thousands, except per share data)

	Three Months Ended															Twelve Months Ended
	December 31,			September 30,			June 30,			March 31,			December 31,			December 31,			December 31,
		2022			2022			2022			2022			2021			2022			2021
Earnings Per Share:
Net income applicable to common shares	$	196,701		$	136,119		$	110,952		$	(29,603	)	$	56,188		$	414,169		$	277,538
Adjustments:
Gain on sale of health savings accounts		(90,673	)		—			—			—			—			(90,673	)		—
Tax effect¹		23,031			—			—			—			—			23,031			—
Gain on sale of health savings accounts, net		(67,642	)		—			—			—			—			(67,642	)		—
Debt Securities (gains) losses		173			172			85			(342	)		(435	)		88			(4,327	)
Tax effect¹		(44	)		(65	)		(30	)		62			109			(76	)		1,082
Debt securities (gains) losses, net		129			107			55			(280	)		(326	)		12			(3,245	)
Day 1 non-PCD		—			—			—			96,270			—			96,270			—
Tax effect¹		—			—			—			(17,550	)		—			(17,550	)		—
Day 1 non-PCD, net		—			—			—			78,720			—			78,720			—
Merger related charges²		20,314			22,743			36,585			52,299			6,683			131,941			14,584
Tax effect¹		(5,160	)		(8,529	)		(13,057	)		(9,534	)		(1,671	)		(36,280	)		(3,646	)
Merger related charges, net		15,154			14,214			23,528			42,765			5,012			95,661			10,938
Property optimization		26,818			—			—			—			—			26,818			—
Tax effect¹		(6,812	)		—			—			—			—			(6,812	)		—
Property optimization, net		20,006			—			—			—			—			20,006			—
ONB Way		—			—			—			—			—			—			1,952
Tax effect¹		—			—			—			—			—			—			(488	)
ONB Way, net		—			—			—			—			—			—			1,464
Total adjustments, net		(32,353	)		14,321			23,583			121,205			4,686			126,757			9,157
Net income applicable to common shares, adjusted	$	164,348		$	150,440		$	134,535		$	91,602		$	60,874		$	540,926		$	286,695
Weighted average diluted common shares outstanding		293,131			292,483			291,881			227,002			166,128			276,688			165,929
EPS, diluted	$	0.67		$	0.47		$	0.38		$	(0.13	)	$	0.34		$	1.50		$	1.67
Adjusted EPS, diluted	$	0.56		$	0.51		$	0.46		$	0.40		$	0.37		$	1.96		$	1.73
NIM:
Net interest income	$	391,090		$	376,589		$	337,472		$	222,785		$	146,781		$	1,327,936		$	596,400
Add: FTE adjustment¹		5,378			4,950			4,314			3,772			3,442			18,414			13,913
Net interest income (FTE)	$	396,468		$	381,539		$	341,786		$	226,557		$	150,223		$	1,346,350		$	610,313
Average earning assets	$	41,206,695		$	41,180,026		$	41,003,338		$	31,483,553		$	21,670,723		$	38,751,786		$	21,152,209
NIM		3.80	%		3.66	%		3.29	%		2.83	%		2.71	%		3.43	%		2.82	%
NIM (FTE)		3.85	%		3.71	%		3.33	%		2.88	%		2.77	%		3.47	%		2.89	%


Non-GAAP Measures (unaudited)
($ in thousands)

	Three Months Ended															Twelve Months Ended
	December 31,			September 30,			June 30,			March 31,			December 31,			December 31,			December 31,
		2022			2022			2022			2022			2021			2022			2021
PPNR:
Net interest income (FTE)¹	$	396,468		$	381,539		$	341,786		$	226,557		$	150,223		$	1,346,350		$	610,313
Add: Noninterest income		165,037			80,385			89,117			65,240			51,484			399,779			214,219
Total revenue (FTE)		561,505			461,924			430,903			291,797			201,707			1,746,129			824,532
Less: Noninterest expense		(282,675	)		(262,444	)		(277,475	)		(215,589	)		(131,355	)		(1,038,183	)		(501,379	)
PPNR	$	278,830		$	199,480		$	153,428		$	76,208		$	70,352		$	707,946		$	323,153
Adjustments:
Gain on sale of health savings accounts	$	(90,673	)	$	—		$	—		$	—		$	—		$	(90,673	)	$	—
Debt securities (gains) losses		173			172			85			(342	)		(435	)		88			(4,327	)
Noninterest income adjustments		(90,500	)		172			85			(342	)		(435	)		(90,585	)		(4,327	)
Adjusted noninterest income		74,537			80,557			89,202			64,898			51,049			309,194			209,892
Adjusted revenue	$	471,005		$	462,096		$	430,988		$	291,455		$	201,272		$	1,655,544		$	820,205
Adjustments:
ONB Way	$	—		$	—		$	—		$	—		$	—		$	—		$	1,952
Merger related charges³		20,314			22,743			36,585			41,286			6,683			120,928			14,584
Property optimization		26,818			—			—			—			—			26,818			—
Amortization of tax credit investments		5,258			2,662			1,525			1,516			2,019			10,961			6,770
Noninterest expense adjustments		52,390			25,405			38,110			42,802			8,702			158,707			23,306
Adjusted total noninterest expense		(230,285	)		(237,039	)		(239,365	)		(172,787	)		(122,653	)		(879,476	)		(478,073	)
Adjusted PPNR	$	240,720		$	225,057		$	191,623		$	118,668		$	78,619		$	776,068		$	342,132
Efficiency Ratio:
Noninterest expense	$	282,675		$	262,444		$	277,475		$	215,589		$	131,355		$	1,038,183		$	501,379
Less: Amortization of intangibles		(6,787	)		(7,089	)		(7,170	)		(4,811	)		(2,573	)		(25,857	)		(11,336	)
Noninterest expense, excl. amortization of intangibles		275,888			255,355			270,305			210,778			128,782			1,012,326			490,043
Less: Noninterest expense adjustments		(52,390	)		(25,405	)		(38,110	)		(42,802	)		(8,702	)		(158,707	)		(23,306	)
Adjusted noninterest expense	$	223,498		$	229,950		$	232,195		$	167,976		$	120,080		$	853,619		$	466,737
Total revenue (FTE)¹	$	561,505		$	461,924		$	430,903		$	291,797		$	201,707		$	1,746,129		$	824,532
Less: Debt securities (gains) losses		173			172			85			(342	)		(435	)		88			(4,327	)
Total revenue excl. debt securities (gains) losses		561,678			462,096			430,988			291,455			201,272			1,746,217			820,205
Less: Gain on sale of health savings accounts		(90,673	)		—			—			—			—			(90,673	)		—
Total adjusted revenue	$	471,005		$	462,096		$	430,988		$	291,455		$	201,272		$	1,655,544		$	820,205
Efficiency Ratio		49.1	%		55.3	%		62.7	%		72.3	%		64.0	%		58.0	%		59.7	%
Efficiency Ratio (prior presentation)⁴	N/A				56.2	%		62.7	%		76.2	%		64.3	%	N/A				59.7	%
Adjusted Efficiency Ratio		47.5	%		49.8	%		53.9	%		57.6	%		59.7	%		51.6	%		56.9	%
Adjusted Efficiency Ratio (prior presentation)⁴	N/A				50.7	%		53.9	%		57.7	%		60.0	%	N/A				56.8	%


Non-GAAP Measures (unaudited)
($ in thousands)

	Three Months Ended															Twelve Months Ended
	December 31,			September 30,			June 30,			March 31,			December 31,			December 31,			December 31,
		2022			2022			2022			2022			2021			2022			2021
ROAE and ROATCE:
Net income (loss) applicable to common shares	$	196,701		$	136,119		$	110,952		$	(29,603	)	$	56,188		$	414,169		$	277,538
Amortization of intangibles		6,787			7,089			7,170			4,811			2,573			25,857			11,336
Tax effect¹		(1,697	)		(1,772	)		(1,793	)		(877	)		(643	)		(6,139	)		(2,834	)
Amortization of intangibles, net		5,090			5,317			5,377			3,934			1,930			19,718			8,502
Net income (loss) applicable to common shares, excluding intangible amortization		201,791			141,436			116,329			(25,669	)		58,118			433,887			286,040
Total adjustments, net (see pg.12)		(32,353	)		14,321			23,583			121,205			4,686			126,757			9,157
Adjusted tangible net income applicable to common shares	$	169,438		$	155,757		$	139,912		$	95,536		$	62,804		$	560,644		$	295,197
Average shareholders' equity	$	4,936,582		$	5,134,153		$	5,129,900		$	4,218,416		$	2,998,825		$	4,857,496		$	2,997,520
Less: Average preferred equity		(243,719	)		(243,719	)		(243,719	)		(117,210	)		—			(212,525	)		—
Average shareholders' common equity	$	4,692,863		$	4,890,434		$	4,886,181		$	4,101,206		$	2,998,825		$	4,644,971		$	2,997,520
Average goodwill and other intangible assets		(2,132,480	)		(2,129,858	)		(2,136,964	)		(1,550,624	)		(1,072,986	)		(1,989,466	)		(1,077,065	)
Average tangible shareholder's common equity	$	2,560,383		$	2,760,576		$	2,749,217		$	2,550,582		$	1,925,839		$	2,655,505		$	1,920,455
ROAE		16.8	%		11.1	%		9.1	%		(2.9	)%		7.5	%		8.9	%		9.3	%
ROAE, adjusted		14.0	%		12.3	%		11.0	%		8.9	%		8.1	%		11.6	%		9.6	%
ROATCE		31.5	%		20.5	%		16.9	%		(4.0	)%		12.1	%		16.3	%		14.9	%
ROATCE, adjusted		26.5	%		22.6	%		20.4	%		15.0	%		13.0	%		21.1	%		15.4	%


Non-GAAP Measures (unaudited)
($ in thousands)

	As of
	December 31,			September 30,			June 30,			March 31,			December 31,
		2022			2022			2022			2022			2021
Tangible Common Equity:
Shareholders' equity	$	5,128,595		$	4,943,383		$	5,078,783		$	5,232,114		$	3,012,018
Less: Preferred equity		(243,719	)		(243,719	)		(243,719	)		(243,719	)		—
Shareholders' common equity	$	4,884,876		$	4,699,664		$	4,835,064		$	4,988,395		$	3,012,018
Less: Goodwill and other intangible assets		(2,125,121	)		(2,135,792	)		(2,131,815	)		(2,144,609	)		(1,071,672	)
Tangible shareholders' common equity	$	2,759,755		$	2,563,872		$	2,703,249		$	2,843,786		$	1,940,346

Total assets	$	46,763,372		$	46,215,526		$	45,748,355		$	45,834,648		$	24,453,564
Add: Trust overdrafts		—			—			—			1			—
Less: Goodwill and other intangible assets		(2,125,121	)		(2,135,792	)		(2,131,815	)		(2,144,609	)		(1,071,672	)
Tangible assets	$	44,638,251		$	44,079,734		$	43,616,540		$	43,690,040		$	23,381,892

Risk-weighted assets⁵	$	35,950,900		$	34,741,765		$	33,662,205		$	32,341,335		$	16,588,469

Tangible common equity to tangible assets		6.18	%		5.82	%		6.20	%		6.51	%		8.30	%
Tangible common equity to risk-weighted assets⁵		7.68	%		7.38	%		8.03	%		8.79	%		11.70	%
Tangible Common Equity:
Common shares outstanding		292,903			292,880			292,893			292,959			165,838
Tangible common book value	$	9.42		$	8.75		$	9.23		$	9.71		$	11.70


¹ Tax-effect calculations use management's estimate of the full year FTE tax rates (federal + state). ² Includes $11.0 million of provision for unfunded commitments for the three months ended March 31, 2022 and the twelve months ended December 31, 2022. ³ Excludes $11.0 million of provision for unfunded commitments that is included in provision for credit losses for the three months ended March 31, 2022 and the twelve months ended December 31, 2022. ⁴ Presented as calculated prior to December 31, 2022, which included the provision for unfunded commitments in noninterest expense. Management believes that removing the provision for unfunded commitments from this metric enhances comparability for peer comparison purposes. ⁵ December 31, 2022 figures are preliminary.