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OLNEY, Md., Oct. 17, 2019 (GLOBE NEWSWIRE) — Sandy Spring Bancorp, Inc., (Nasdaq-SASR), the parent company of Sandy Spring Bank, today reported net income for the third quarter of 2019 of $29.4 million ($0.82 per diluted share) compared to net income of $29.2 million ($0.82 per diluted share) for the third quarter of 2018 and net income of $28.3 million ($0.79 per diluted share) for the second quarter of 2019.

“In the third quarter we executed our business strategies with precision, focus and company-wide coordination. As a result, we delivered growth in every key category and solid financial metrics,” said Daniel J. Schrider, President and Chief Executive Officer. “We continue to succeed in one of the most desirable markets in the country, and we are deepening our presence in Greater Washington through the acquisition of Revere Bank. We are in a tremendous position of strength as we prepare to close out the year and begin preparing the integration of Revere Bank into Sandy Spring Bank.”

Third Quarter Highlights:  

• Total loans at September 30, 2019 increased 3% compared to September 30, 2018.  During this period, the impact of the 6% growth in commercial loans was offset by the decline in the mortgage loan portfolio due to the impact of mortgage loan refinance activity driven by the current interest rate environment and the sale of the majority of new mortgage loan production. 
  
• Total deposits grew 10% from the third quarter of 2018 and compared to the end of 2018. Deposit growth reduced the loan-to-deposit ratio from 111% at year-end 2018 to 102% at the end of the current quarter.  The year-to-date deposit growth included a 19% increase in noninterest-bearing deposits and a 45% reduction in wholesale deposits.
  
• The provision for loan losses for the current quarter was $1.5 million compared to $1.9 million for the third quarter of 2018 and $1.6 million for the prior quarter of the current year.
  
• The net interest margin was 3.51% for the third quarter of 2019, compared to 3.71% for the third quarter of 2018 and 3.54% for the second quarter of 2019.  The prior year’s quarterly margin was positively impacted by an interest income recovery of $2.0 million.  Excluding the recovery, the net interest margin for the prior year quarter was 3.60%.
  
• On September 24, 2019, the Company entered into a definitive agreement and plan of merger pursuant to which Revere Bank will merge with and into Sandy Spring Bank in a transaction valued at approximately $461 million.  Revere Bank, headquartered in Rockville, Maryland, has 11 banking offices and more than $2.6 billion in assets (as of June 30, 2019).
  
• Quarterly non-interest income increased 24% as compared to the same period in the prior year driven by income from mortgage banking activities that grew 164%.  Growth was experienced in almost every other major category of non-interest income for the second consecutive quarter.
  
• Non-interest expense for the quarter increased $2.5 million or 6% compared to the same quarter of the prior year.  Increases occurred in most major expense categories, notably compensation and benefits driven by incentive-based programs and an increase in marketing costs.  A large portion of the overall expense increases were offset by a decrease in FDIC insurance due to the receipt of an assessment credit during the current quarter.
  
• The non-GAAP efficiency ratio continued to remain stable at 50.95% for the current quarter as compared to 49.27% for the third quarter of 2018 and 51.71% for the second quarter of 2019. Excluding the previously mentioned interest recovery in the prior year quarter, the non-GAAP efficiency ratio was 50.48%.

Review of Balance Sheet and Credit Quality

At September 30, 2019, total assets amounted to $8.4 billion compared to $8.0 billion at September 30, 2018 and $8.2 billion at December 31, 2018. Total loans at September 30, 2019 were $6.6 billion compared to $6.4 billion at September 30, 2018 and $6.6 billion at December 31, 2018.  Overall, the loan portfolio has remained relatively level from December 31, 2018 through September 30, 2019.  During this period, commercial loans grew 3% while mortgage loans have declined 2% due to the refinance activity and the strategic decision to sell the majority of new mortgage loan production.  During this period, total funded loan production was $618 million.  Commercial loans originated year-to-date had total unfunded commitments of $359 million as of September 30, 2019. 

Total deposits at September 30, 2019 were $6.5 billion compared to $5.9 billion at both September 30, 2018 and December 31, 2018.  The 10% increase from year-end 2018 was driven by increases in the majority of deposit categories.  The impact of the increase in deposits and rates during the first nine months of 2019 was partially offset by the benefit realized from an increase in noninterest-bearing deposits and a reduction in wholesale deposits. The increase in deposits enabled the reduction of higher cost borrowings, which declined $533 million from year-end through September 30, 2019, providing a positive impact on net interest income. 

Tangible common equity totaled $787 million at September 30, 2019, compared to $711 million at September 30, 2018 as the ratio of tangible common equity to tangible assets grew to 9.74% at September 30, 2019, as compared to 9.26% at September 30, 2018.  The Company had a total risk-based capital ratio of 12.70%, a common equity tier 1 risk-based capital ratio of 11.37%, a tier 1 risk-based capital ratio of 11.52% and a tier 1 leverage ratio of 9.96% at September 30, 2019.

The ratio of non-performing loans to total loans increased to 0.61% at September 30, 2019, compared to 0.52% at September 30, 2018.  Non-performing loans totaled $40.1 million at September 30, 2019, compared to $33.3 million at September 30, 2018, and $37.7 million at June 30, 2019. The modest growth in non-performing loans over the prior periods occurred primarily as a result of increases in segments of the loan portfolio secured by real estate.  Non-performing loans include accruing loans 90 days or more past due and restructured loans, but exclude purchased credit impaired loans acquired in the prior year’s acquisition of WashingtonFirst Bankshares, Inc. (“WashingtonFirst”).

Loan charge-offs, net of recoveries, for the third quarter of 2019 totaled $0.6 million.  Charge-offs for the third quarter of 2018 were not significant.  The allowance for loan losses represented 0.83% of outstanding loans and 137% of non-performing loans at September 30, 2019, compared to 0.79% of outstanding loans and 151% of non-performing loans at September 30, 2018. While non-performing loans increased from September 30, 2018 to the current quarter, the related reserves for those loans remained stable due to adequate collateral values. 

Income Statement Review

For the third quarter of 2019, net interest income decreased to $66.8 million compared to $67.6 million for the third quarter of 2018.  During this period, interest income increased 3% primarily due to loan growth and interest expense increased 21% related to deposit growth resulting in the decline in net interest income. The net interest margin for the current quarter was 3.51%, compared to the net interest margin for the third quarter of 2018 of 3.71%.  The prior year’s quarterly margin was positively impacted by an interest income recovery of $2.0 million.  Excluding this recovery, the prior year’s net interest margin was 3.60%.  The current quarter’s margin benefited from the decrease in average borrowed funds in addition to an increase in average noninterest-bearing deposits compared to the prior year quarter.  Amortization of the fair value adjustments to both interest-earning assets and interest-bearing liabilities directly attributable to the WashingtonFirst acquisition had a 4 basis point positive effect on the net interest margin for the current period, compared to 8 basis points for the same period of the prior year.  The resulting adjusted net interest margin for the current quarter was 3.47% as compared to 3.52% for the prior year quarter.

The provision for loan losses was $1.5 million for the third quarter of 2019, compared to $1.9 million for the third quarter of 2018. The current quarter’s provision reflects the impact of organic loan production and the need to establish a loan loss provision for previously acquired loans that had reached their maturity under their original lending arrangements and were renewed by Sandy Spring Bank.  

Non-interest income increased 24% to $18.6 million for the third quarter of 2019, compared to $15.0 million for the third quarter of 2018.  The increase in non-interest income was due primarily to the 164% increase in income from mortgage banking activities as the volume of residential mortgages sold increased.  Increases occurred in all non-interest income sources during the current quarter, with the exception of income from bank-owned life insurance, which remained level as compared to the third quarter of 2018.

Non-interest expense increased 6% to $44.9 million for the third quarter of 2019, compared to $42.4 million in the third quarter of 2018. The current year quarter included $0.4 million in merger expenses compared to $0.6 million for the prior year quarter.  Excluding merger expenses, non-interest expense increased 7% compared to the prior year, driven by higher compensation costs associated with incentive-based sales programs, marketing campaign expenses and an increase in occupancy and equipment costs.  A portion of these increases were offset by a decrease in FDIC insurance due to the industry deposit insurance fund reaching the stipulated benchmark levels.  The non-GAAP efficiency ratio was 50.95% for the third quarter of 2019, compared to 49.27% for the third quarter of 2018.  The non-GAAP efficiency ratio for the prior year quarter was 50.48% after excluding the previously mentioned interest income recovery.

Net interest income for the nine months ended September 30, 2019 increased 3% compared to the first nine months of 2018 due principally to loan growth. During the first nine months of 2019, the net interest margin was 3.55% compared to 3.62% for the prior year period. The first nine months of 2019 included $1.8 million in recovered interest income on acquired credit impaired loans compared to $2.0 million for the same period of the prior year.  Excluding the recovered interest income from both periods, the interest margin would have been 3.52% for the current year versus 3.59% for the prior year.  Amortization of the fair value adjustments attributable to the WashingtonFirst acquisition had a 5 basis point positive impact on the net interest margin for the nine months ended September 30, 2019, compared to 14 basis points for the prior year period. 

The provision for loan losses was $3.0 million for the first nine months of 2019, compared to $5.6 million for the first nine months of 2018.  The decrease in the provision for the current period compared to the prior year was primarily the result of the overall improvement in the qualitative credit metrics of the loan portfolio during the previous twelve months in addition to lower loan growth than experienced in the prior year.

Non-interest income was $52.1 million for the first nine months of 2019, compared to $47.0 million for the first nine months of 2018.  Excluding life insurance mortality proceeds of $0.6 million and $1.6 million from the first nine months of 2019 and 2018, respectively, non-interest income increased 13%. This increase was driven by income from mortgage banking activities, which increased 77% from the prior year-to-date, to $10.5 million for the nine months ended September 30, 2019, as a result of the rise in mortgage lending activity during 2019. Sales of originated mortgage loans rose 51% during the current period compared to the same period for 2018.  Increases also occurred in service charges, wealth management income, insurance commissions and other non-interest income.

Non-interest expense decreased 3% or $4.1 million to $133.0 million for the first nine months of 2019, compared to $137.1 million for the prior year period.  The prior year period included $11.8 million in merger expenses.  Excluding merger expenses, non-interest expense rose 6%, driven by increases in salaries and benefits, software costs, marketing costs and expenses from outside data services.  A portion of the increases in non-interest expense was offset by the decrease in FDIC insurance during the year.  The non-GAAP efficiency ratio was 51.36% for the first nine months of 2019 compared to 50.57% for the first nine months of 2018.

Explanation of Non-GAAP Financial Measures

This news release contains financial information and performance measures determined by methods other than in accordance with generally accepted accounting principles in the United States (“GAAP”). The Company’s management believes that the supplemental non-GAAP information provides a better comparison of period-to-period operating performance. Additionally, the Company believes this information is utilized by regulators and market analysts to evaluate a company’s financial condition and, therefore, such information is useful to investors.  Non-GAAP measures used in this release consist of the following:

• Tangible common equity and related measures are non-GAAP measures that exclude the impact of intangible assets.
• The non-GAAP efficiency ratio is non-GAAP in that it excludes amortization of intangible assets, merger expenses and securities gains and includes tax-equivalent income.

These disclosures should not be viewed as a substitute for financial results in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures which may be presented by other companies. Please refer to the non-GAAP Reconciliation table included with this release for details on the earnings impact of these items.

Conference Call

The Company’s management will host a conference call to discuss its third quarter results today at 2:00 P.M. (ET).  A live Webcast of the conference call is available through the Investor Relations section of the Sandy Spring Website at www.sandyspringbank.com.  Participants may call 1-866-235-9910. A password is not necessary.  Visitors to the website are advised to log on 10 minutes ahead of the scheduled start of the call.  An internet-based replay will be available on the website until 9:00 am (ET) October 31, 2019.  A replay of the teleconference will be available through the same time period by calling 1-877-344-7529 under conference call number 10135193.

About Sandy Spring Bancorp, Inc.

Sandy Spring Bancorp, Inc., headquartered in Olney, Maryland, is the holding company for Sandy Spring Bank, the largest locally-headquartered community bank in the Greater Washington, D.C. region. With over 50 locations, the bank offers a broad range of commercial and retail banking, mortgage, private banking, and trust services throughout central Maryland, Northern Virginia, and Washington, D.C. Through its subsidiaries, Sandy Spring Insurance Corporation and West Financial Services, Inc., Sandy Spring Bank also offers a comprehensive menu of insurance and wealth management services. Visit www.sandyspringbank.com for more information.

For additional information or questions, please contact:
Daniel J. Schrider, President & Chief Executive Officer, or
Philip J. Mantua, E.V.P. & Chief Financial Officer
Sandy Spring Bancorp
17801 Georgia Avenue
Olney, Maryland 20832
1-800-399-5919 
Email:  DSchrider@sandyspringbank.com
            PMantua@sandyspringbank.com
Website: www.sandyspringbank.com

Media Contact:
Jen Schell
301-570-8331
jschell@sandyspringbank.com

Forward-Looking Statements

Sandy Spring Bancorp makes forward-looking statements in this news release and in the conference call regarding this news release.  These forward-looking statements may include: statements of goals, intentions, earnings expectations, and other expectations; estimates of risks and of future costs and benefits; assessments of probable loan losses; assessments of market risk; and statements of the ability to achieve financial and other goals.

Forward-looking statements are typically identified by words such as “believe,” “expect,” “anticipate,” “intend,” “outlook,” “estimate,” “forecast,” “project” and other similar words and expressions.  Forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time.  Forward-looking statements speak only as of the date they are made.  Sandy Spring Bancorp does not assume any duty and does not undertake to update its forward-looking statements.  Because forward-looking statements are subject to assumptions and uncertainties, actual results or future events could differ, possibly materially, from those that Sandy Spring Bancorp anticipated in its forward-looking statements and future results could differ materially from historical performance.

Sandy Spring Bancorp’s forward-looking statements are subject to the following principal risks and uncertainties: general economic conditions and trends, either nationally or locally; conditions in the securities markets; changes in interest rates; changes in deposit flows, and in the demand for deposit, loan, and investment products and other financial services; changes in real estate values; changes in the quality or composition of the Company’s loan or investment portfolios; changes in competitive pressures among financial institutions or from non-financial institutions; the Company’s ability to retain key members of management; changes in legislation, regulations, and policies; risks, uncertainties and other factors relating to the acquisition of Revere Bank by Sandy Spring Bancorp, including the ability to obtain regulatory and shareholder approvals and meet other closing conditions to the transaction, and delay in closing the merger; the possibility that any of the anticipated benefits of acquisitions will not be realized or will not be realized within the expected time period; and a variety of other matters which, by their nature, are subject to significant uncertainties.  Sandy Spring Bancorp provides greater detail regarding some of these factors in its Form 10-K for the year ended December 31, 2018, including in the Risk Factors section of that report, and in its other SEC reports.  Sandy Spring Bancorp’s forward-looking statements may also be subject to other risks and uncertainties, including those that it may discuss elsewhere in this news release or in its filings with the SEC, accessible on the SEC’s Web site at www.sec.gov.

Sandy Spring Bancorp, Inc. and Subsidiaries
FINANCIAL HIGHLIGHTS – UNAUDITED
		Three Months Ended										Nine Months Ended
		September 30,						%				September 30,						%
(Dollars in thousands, except per share data)			2019			2018		Change					2019			2018		Change
Results of Operations:
Net interest income		$	66,790		$	67,591		(1	)	%		$	199,725		$	194,300		3		%
Provision for loan losses			1,524			1,890		(19	)				3,029			5,620		(46	)
Non-interest income			18,573			15,033		24					52,098			47,019		11
Non-interest expense			44,925			42,393		6					133,004			137,116		(3	)
Income before income taxes			38,914			38,341		1					115,790			98,583		17
Net income			29,383			29,234		1					87,976			75,298		17
Pre-tax pre-provision pre-merger income (5)		$	40,802		$	40,811		–				$	119,183		$	115,969		3
Return on average assets			1.39	%		1.45	%						1.42	%		1.27	%
Return on average common equity			10.38	%		11.26	%						10.71	%		9.89	%
Net interest margin			3.51	%		3.71	%						3.55	%		3.62	%
Efficiency ratio – GAAP basis (1)			52.63	%		51.31	%						52.82	%		56.82	%
Efficiency ratio – Non-GAAP basis (1)			50.95	%		49.27	%						51.36	%		50.57	%
Per share data:
Basic net income		$	0.82		$	0.82		–		%		$	2.46		$	2.11		17		%
Diluted net income		$	0.82		$	0.82		–				$	2.45		$	2.11		16
Average fully diluted shares			35,900,102			35,744,085		–					35,879,584			35,721,702		–
Dividends declared per share		$	0.30		$	0.28		7				$	0.88		$	0.82		7
Book value per share			32.00			29.35		9					32.00			29.35		9
Tangible book value per share (5)			22.10			20.03		10					22.10			20.03		10
Outstanding shares			35,625,822			35,521,541		–					35,625,822			35,521,541		–
Financial Condition at period-end:
Investment securities		$	946,210		$	992,797		(5	)	%		$	946,210		$	992,797		(5	)	%
Loans			6,596,548			6,388,959		3					6,596,548			6,388,959		3
Interest-earning assets			7,742,138			7,428,534		4					7,742,138			7,428,534		4
Assets			8,437,538			8,034,565		5					8,437,538			8,034,565		5
Deposits			6,493,899			5,898,394		10					6,493,899			5,898,394		10
Interest-bearing liabilities			5,093,265			5,042,431		1					5,093,265			5,042,431		1
Stockholders’ equity			1,140,041			1,042,716		9					1,140,041			1,042,716		9
Capital ratios:
Tier 1 leverage (4)			9.96	%		9.46	%						9.96	%		9.46	%
Tier 1 capital to risk-weighted assets (4)			11.52	%		11.18	%						11.52	%		11.18	%
Total regulatory capital to risk-weighted assets (4)			12.70	%		12.38	%						12.70	%		12.38	%
Common equity tier 1 capital to risk-weighted assets (4)			11.37	%		11.02	%						11.37	%		11.02	%
Tangible common equity to tangible assets (2)			9.74	%		9.26	%						9.74	%		9.26	%
Average equity to average assets			13.42	%		12.90	%						13.22	%		12.85	%
Credit quality ratios:
Allowance for loan losses to loans			0.83	%		0.79	%						0.83	%		0.79	%
Non-performing loans to total loans			0.61	%		0.52	%						0.61	%		0.52	%
Non-performing assets to total assets			0.49	%		0.44	%						0.49	%		0.44	%
Allowance for loan losses to non-performing loans			137.05	%		151.35	%						137.05	%		151.35	%
Annualized net charge-offs to average loans (3)			0.03	%		0.00	%						0.03	%		0.01	%
(1) The efficiency ratio – GAAP basis is non-interest expense divided by net interest income plus non-interest income from the Condensed Consolidated Statements of Income.
The traditional efficiency ratio – Non-GAAP basis excludes intangible asset amortization and merger expenses from non-interest expense;
securities gains from non-interest income and adds the tax-equivalent adjustment to net interest income. See the Reconciliation Table included with these Financial Highlights.
(2) The tangible common equity to tangible assets ratio is a non-GAAP ratio that divides assets excluding intangible assets into stockholders’ equity after deducting intangible assets
and other comprehensive gains (losses). See the Reconciliation Table included with these Financial Highlights.
(3) Calculation utilizes average loans, excluding residential mortgage loans held-for-sale.
(4) Estimated ratio at September 30, 2019.
(5) Represents a Non-GAAP measure.

Sandy Spring Bancorp, Inc. and Subsidiaries
RECONCILIATION TABLE – UNAUDITED
		Three Months Ended								Nine Months Ended
		September 30,								September 30,
(Dollars in thousands)			2019				2018				2019				2018
Pre-tax pre-provision pre-merger income:
Net income		$	29,383			$	29,234			$	87,976			$	75,298
Plus non-GAAP adjustments:
Merger expenses			364				580				364				11,766
Income taxes			9,531				9,107				27,814				23,285
Provision for loan losses			1,524				1,890				3,029				5,620
Pre-tax pre-provision pre-merger income		$	40,802			$	40,811			$	119,183			$	115,969
Efficiency ratio – GAAP basis:
Non-interest expense		$	44,925			$	42,393			$	133,004			$	137,116
Net interest income plus non-interest income		$	85,363			$	82,624			$	251,823			$	241,319
Efficiency ratio – GAAP basis			52.63	%			51.31	%			52.82	%			56.82	%
Efficiency ratio – Non-GAAP basis:
Non-interest expense		$	44,925			$	42,393			$	133,004			$	137,116
Less non-GAAP adjustments:
Amortization of intangible assets			491				540				1,465				1,622
Merger expenses			364				580				364				11,766
Non-interest expense – as adjusted		$	44,070			$	41,273			$	131,175			$	123,728
Net interest income plus non-interest income		$	85,363			$	82,624			$	251,823			$	241,319
Plus non-GAAP adjustment:
Tax-equivalent income			1,147				1,221				3,597				3,483
Less non-GAAP adjustment:
Securities gains			15				82				20				145
Net interest income plus non-interest income – as adjusted		$	86,495			$	83,763			$	255,400			$	244,657
Efficiency ratio – Non-GAAP basis			50.95	%			49.27	%			51.36	%			50.57	%
Tangible common equity ratio:
Total stockholders’ equity		$	1,140,041			$	1,042,716			$	1,140,041			$	1,042,716
Accumulated other comprehensive loss			2,708				24,420				2,708				24,420
Goodwill			(347,149	)			(345,422	)			(347,149	)			(345,422	)
Other intangible assets, net			(8,322	)			(10,327	)			(8,322	)			(10,327	)
Tangible common equity		$	787,278			$	711,387			$	787,278			$	711,387
Total assets		$	8,437,538			$	8,034,565			$	8,437,538			$	8,034,565
Goodwill			(347,149	)			(345,422	)			(347,149	)			(345,422	)
Other intangible assets, net			(8,322	)			(10,327	)			(8,322	)			(10,327	)
Tangible assets		$	8,082,067			$	7,678,816			$	8,082,067			$	7,678,816
Tangible common equity ratio			9.74	%			9.26	%			9.74	%			9.26	%
Outstanding common shares			35,625,822				35,521,541				35,625,822				35,521,541
Tangible book value per common share		$	22.10			$	20.03			$	22.10			$	20.03

Sandy Spring Bancorp, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF CONDITION – UNAUDITED
		September 30,				December 31,				September 30,
(Dollars in thousands)			2019				2018				2018
Assets
Cash and due from banks		$	89,377			$	67,014			$	63,380
Federal funds sold			253				609				2,055
Interest-bearing deposits with banks			120,306				33,858				13,142
Cash and cash equivalents			209,936				101,481				78,577
Residential mortgage loans held for sale (at fair value)			78,821				22,773				31,581
Investments available-for-sale (at fair value)			894,272				937,335				926,723
Other equity securities			51,938				73,389				66,074
Total loans			6,596,548				6,571,634				6,388,959
Less: allowance for loan losses			(54,992	)			(53,486	)			(50,409	)
Net loans			6,541,556				6,518,148				6,338,550
Premises and equipment, net			59,487				61,942				62,098
Other real estate owned			1,482				1,584				2,118
Accrued interest receivable			23,438				24,609				24,058
Goodwill			347,149				347,149				345,422
Other intangible assets, net			8,322				9,788				10,327
Other assets			221,137				145,074				149,037
Total assets		$	8,437,538			$	8,243,272			$	8,034,565
Liabilities
Noninterest-bearing deposits		$	2,081,435			$	1,750,319			$	1,902,537
Interest-bearing deposits			4,412,464				4,164,561				3,995,857
Total deposits			6,493,899				5,914,880				5,898,394
Securities sold under retail repurchase agreements and federal funds purchased			126,008				327,429				142,669
Advances from FHLB			517,477				848,611				866,445
Subordinated debentures			37,316				37,425				37,460
Accrued interest payable and other liabilities			122,797				47,024				46,881
Total liabilities			7,297,497				7,175,369				6,991,849
Stockholders’ Equity
Common stock — par value $1.00; shares authorized 100,000,000; shares issued and outstanding 35,625,822,
35,530,734 and 35,521,541 at September 30, 2019, December 31, 2018 and September 30, 2018, respectively			35,626				35,531				35,522
Additional paid in capital			609,103				606,573				605,623
Retained earnings			498,020				441,553				425,991
Accumulated other comprehensive loss			(2,708	)			(15,754	)			(24,420	)
Total stockholders’ equity			1,140,041				1,067,903				1,042,716
Total liabilities and stockholders’ equity		$	8,437,538			$	8,243,272			$	8,034,565

Sandy Spring Bancorp, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF INCOME – UNAUDITED
		Three Months Ended							Nine Months Ended
		September 30,							September 30,
(Dollars in thousands, except per share data)			2019				2018			2019			2018
Interest Income:
Interest and fees on loans		$	79,167			$	76,786		$	239,028		$	215,050
Interest on loans held for sale			572				336			1,145			983
Interest on deposits with banks			783				211			1,405			1,082
Interest and dividends on investment securities:
Taxable			5,221				5,112			16,302			15,297
Exempt from federal income taxes			1,337				1,921			4,591			6,035
Interest on federal funds sold			2				8			8			28
Total interest income			87,082				84,374			262,479			238,475
Interest Expense:
Interest on deposits			16,332				10,773			46,958			26,583
Interest on retail repurchase agreements and federal funds purchased			257				383			945			599
Interest on advances from FHLB			3,222				5,141			13,389			15,557
Interest on subordinated debt			481				486			1,462			1,436
Total interest expense			20,292				16,783			62,754			44,175
Net interest income			66,790				67,591			199,725			194,300
Provision for loan losses			1,524				1,890			3,029			5,620
Net interest income after provision for loan losses			65,266				65,701			196,696			188,680
Non-interest Income:
Investment securities gains			15				82			20			145
Service charges on deposit accounts			2,516				2,316			7,265			6,865
Mortgage banking activities			4,408				1,672			10,541			5,943
Wealth management income			5,493				5,344			16,268			15,792
Insurance agency commissions			2,116				2,016			5,281			5,020
Income from bank owned life insurance			662				663			2,505			3,664
Bank card fees			1,462				1,436			4,181			4,199
Other income			1,901				1,504			6,037			5,391
Total non-interest income			18,573				15,033			52,098			47,019
Non-interest Expense:
Salaries and employee benefits			26,234				24,488			77,699			73,064
Occupancy expense of premises			4,816				4,355			14,807			13,939
Equipment expenses			2,641				2,441			7,929			6,909
Marketing			1,541				770			3,371			2,863
Outside data services			1,973				1,736			5,713			4,840
FDIC insurance			(83	)			1,257			2,137			3,840
Amortization of intangible assets			491				540			1,465			1,622
Merger expenses			364				580			364			11,766
Professional fees and services			1,546				1,351			4,425			4,090
Other expenses			5,402				4,875			15,094			14,183
Total non-interest expense			44,925				42,393			133,004			137,116
Income before income taxes			38,914				38,341			115,790			98,583
Income tax expense			9,531				9,107			27,814			23,285
Net income		$	29,383			$	29,234		$	87,976		$	75,298
Net Income Per Share Amounts:
Basic net income per share		$	0.82			$	0.82		$	2.46		$	2.11
Diluted net income per share		$	0.82			$	0.82		$	2.45		$	2.11
Dividends declared per share		$	0.30			$	0.28		$	0.88		$	0.82

Sandy Spring Bancorp, Inc. and Subsidiaries
HISTORICAL TRENDS – QUARTERLY FINANCIAL DATA – UNAUDITED
			2019												2018
(Dollars in thousands, except per share data)		Q3				Q2				Q1				Q4				Q3				Q2				Q1
Profitability for the Quarter:
Tax-equivalent interest income		$	88,229			$	88,423			$	89,424			$	86,839			$	85,595			$	79,774			$	76,589
Interest expense			20,292				21,029				21,433				19,462				16,783				14,779				12,613
Tax-equivalent net interest income			67,937				67,394				67,991				67,377				68,812				64,995				63,976
Tax-equivalent adjustment			1,147				1,209				1,241				1,232				1,221				1,177				1,085
Provision (credit) for loan losses			1,524				1,633				(128	)			3,403				1,890				1,733				1,997
Non-interest income			18,573				16,556				16,969				14,030				15,033				14,868				17,118
Non-interest expense			44,925				43,887				44,192				42,667				42,393				45,082				49,641
Income before income taxes			38,914				37,221				39,655				34,105				38,341				31,871				28,371
Income tax expense			9,531				8,945				9,338				8,539				9,107				7,472				6,706
Net income		$	29,383			$	28,276			$	30,317			$	25,566			$	29,234			$	24,399			$	21,665
Financial Performance:
Pre-tax pre-provision pre-merger income		$	40,802			$	38,854			$	39,527			$	37,508			$	40,811			$	35,832			$	39,326
Return on average assets			1.39	%			1.37	%			1.49	%			1.25	%			1.45	%			1.23	%			1.12	%
Return on average common equity			10.38	%			10.32	%			11.46	%			9.70	%			11.26	%			9.66	%			8.70	%
Net interest margin			3.51	%			3.54	%			3.60	%			3.57	%			3.71	%			3.56	%			3.58	%
Efficiency ratio – GAAP basis (1)			52.63	%			53.04	%			52.79	%			53.22	%			51.31	%			57.29	%			62.04	%
Efficiency ratio – Non-GAAP basis (1)			50.95	%			51.71	%			51.44	%			51.78	%			49.27	%			52.98	%			49.54	%
Per Share Data:
Basic net income per share		$	0.82			$	0.79			$	0.85			$	0.72			$	0.82			$	0.68			$	0.61
Diluted net income per share		$	0.82			$	0.79			$	0.85			$	0.72			$	0.82			$	0.68			$	0.61
Average fully diluted shares			35,900,102				35,890,437				35,806,459				35,747,478				35,744,085				35,743,927				35,683,542
Dividends declared per common share		$	0.30			$	0.30			$	0.28			$	0.28			$	0.28			$	0.28			$	0.26
Non-interest Income:
Securities gains		$	15			$	5			$	–			$	45			$	82			$	–			$	63
Service charges on deposit accounts			2,516				2,442				2,307				2,459				2,316				2,290				2,259
Mortgage banking activities			4,408				3,270				2,863				1,130				1,672				2,064				2,207
Wealth management income			5,493				5,539				5,236				5,492				5,344				5,387				5,061
Insurance agency commissions			2,116				1,265				1,900				1,138				2,016				1,180				1,824
Income from bank owned life insurance			662				654				1,189				663				663				670				2,331
Bank card fees			1,462				1,467				1,252				1,368				1,436				1,393				1,370
Other income			1,901				1,914				2,222				1,735				1,504				1,884				2,003
Total Non-interest Income		$	18,573			$	16,556			$	16,969			$	14,030			$	15,033			$	14,868			$	17,118
Non-interest Expense:
Salaries and employee benefits		$	26,234			$	25,489			$	25,976			$	23,934			$	24,488			$	24,664			$	23,912
Occupancy expense of premises			4,816				4,760				5,231				4,413				4,355				4,642				4,942
Equipment expenses			2,641				2,712				2,576				2,426				2,441				2,243				2,225
Marketing			1,541				887				943				1,061				770				945				1,148
Outside data services			1,973				1,962				1,778				1,763				1,736				1,707				1,397
FDIC insurance			(83	)			1,084				1,136				1,255				1,257				1,390				1,193
Amortization of intangible assets			491				483				491				540				540				541				541
Merger expenses			364				–				–				–				580				2,228				8,958
Professional fees and services			1,546				1,634				1,245				1,966				1,351				1,699				1,040
Other expenses			5,402				4,876				4,816				5,309				4,875				5,023				4,285
Total Non-interest Expense		$	44,925			$	43,887			$	44,192			$	42,667			$	42,393			$	45,082			$	49,641
(1) The efficiency ratio – GAAP basis is non-interest expense divided by net interest income plus non-interest income from the Condensed Consolidated Statements of Income.
The traditional efficiency ratio – Non-GAAP basis excludes intangible asset amortization and merger expenses from non-interest expense;
securities gains from non-interest income; and adds the tax-equivalent adjustment to net interest income. See the Reconciliation Table included with these Financial Highlights.

Sandy Spring Bancorp, Inc. and Subsidiaries
HISTORICAL TRENDS – QUARTERLY FINANCIAL DATA – UNAUDITED
			2019												2018
(Dollars in thousands)		Q3				Q2				Q1				Q4				Q3				Q2				Q1
Balance Sheets at Quarter End:
Residential mortgage loans		$	1,199,275			$	1,241,081			$	1,249,968			$	1,228,247			$	1,181,427			$	1,106,674			$	992,287
Residential construction loans			150,692				171,106				176,388				186,785				188,779				197,372				215,445
Commercial AD&C loans			678,906				658,709				688,939				681,201				631,589				609,266				564,871
Commercial investor real estate loans			2,036,021				1,994,027				1,962,879				1,958,395				1,924,397				1,923,827				1,928,439
Commercial owner occupied real estate loans			1,278,505				1,224,986				1,216,713				1,202,903				1,201,673				1,184,421				1,174,739
Commercial business loans			772,619				772,158				769,660				796,264				738,083				702,939				652,797
Consumer loans			480,530				489,176				505,443				517,839				523,011				525,574				532,973
Total loans			6,596,548				6,551,243				6,569,990				6,571,634				6,388,959				6,250,073				6,061,551
Allowance for loan losses			(54,992	)			(54,024	)			(53,089	)			(53,486	)			(50,409	)			(48,493	)			(46,931	)
Loans held for sale			78,821				50,511				24,998				22,773				31,581				40,000				28,486
Investment securities			946,210				955,715				987,299				1,010,724				992,797				1,017,274				1,040,339
Interest-earning assets			7,742,138				7,713,364				7,648,654				7,639,598				7,428,534				7,532,664				7,285,731
Total assets			8,437,538				8,398,519				8,327,900				8,243,272				8,034,565				8,152,600				7,894,918
Noninterest-bearing demand deposits			2,081,435				2,023,614				1,813,708				1,750,319				1,902,537				1,910,690				1,767,523
Total deposits			6,493,899				6,389,749				6,224,523				5,914,880				5,898,394				5,837,826				5,627,206
Customer repurchase agreements			126,008				150,604				122,626				137,429				142,669				139,647				149,323
Total interest-bearing liabilities			5,093,265				5,136,860				5,297,108				5,378,026				5,042,431				5,168,055				5,057,645
Total stockholders’ equity			1,140,041				1,119,445				1,095,848				1,067,903				1,042,716				1,026,349				1,014,608
Quarterly Average Balance Sheets:
Residential mortgage loans		$	1,215,132			$	1,244,086			$	1,230,319			$	1,188,135			$	1,122,946			$	1,034,062			$	1,117,478
Residential construction loans			162,196				174,095				189,720				202,710				215,578				223,171				193,327
Commercial AD&C loans			651,905				686,282				676,205				647,115				632,354				576,076				582,876
Commercial investor real estate loans			1,982,979				1,960,919				1,964,699				1,936,936				1,905,427				1,924,759				1,988,340
Commercial owner occupied real estate loans			1,258,000				1,215,632				1,207,799				1,196,506				1,190,865				1,184,409				940,065
Commercial business loans			786,150				756,594				780,318				751,754				700,791				666,280				657,372
Consumer loans			486,865				505,235				515,644				522,453				524,605				531,965				538,198
Total loans			6,543,227				6,542,843				6,564,704				6,445,609				6,292,566				6,140,722				6,017,656
Loans held for sale			61,870				37,121				17,846				21,923				29,939				25,403				35,768
Investment securities			941,048				964,863				1,010,940				986,146				996,365				1,028,306				1,062,325
Interest-earning assets			7,690,629				7,619,240				7,627,187				7,495,338				7,372,536				7,311,272				7,212,878
Total assets			8,370,789				8,294,883				8,258,116				8,104,916				7,986,525				7,926,735				7,841,611
Noninterest-bearing demand deposits			1,909,884				1,796,802				1,682,720				1,766,672				1,822,931				1,796,644				1,651,258
Total deposits			6,405,762				6,247,409				5,952,942				5,822,580				5,783,992				5,657,420				5,489,715
Customer repurchase agreements			138,736				141,865				129,059				146,637				139,809				148,539				136,694
Total interest-bearing liabilities			5,202,876				5,269,209				5,403,946				5,230,254				5,076,717				5,058,016				5,116,904
Total stockholders’ equity			1,123,185				1,099,078				1,073,291				1,045,378				1,030,167				1,013,081				1,010,106
Financial Measures:
Average equity to average assets			13.42	%			13.25	%			13.00	%			12.90	%			12.90	%			12.78	%			12.88	%
Investment securities to earning assets			12.22	%			12.39	%			12.91	%			13.23	%			13.36	%			13.50	%			14.28	%
Loans to earning assets			85.20	%			84.93	%			85.90	%			86.02	%			86.01	%			82.97	%			83.20	%
Loans to assets			78.18	%			78.00	%			78.89	%			79.72	%			79.52	%			76.66	%			76.78	%
Loans to deposits			101.58	%			102.53	%			105.55	%			111.10	%			108.32	%			107.06	%			107.72	%
Capital Measures:
Tier 1 leverage (1)			9.96	%			9.80	%			9.61	%			9.50	%			9.46	%			9.27	%			9.21	%
Tier 1 capital to risk-weighted assets (1)			11.52	%			11.59	%			11.35	%			11.06	%			11.18	%			11.01	%			11.08	%
Total regulatory capital to risk-weighted assets (1)			12.70	%			12.79	%			12.54	%			12.26	%			12.38	%			12.19	%			12.27	%
Common equity tier 1 capital to risk-weighted assets (1)			11.37	%			11.43	%			11.19	%			10.90	%			11.02	%			10.85	%			10.92	%
Book value per share		$	32.00			$	31.43			$	30.82			$	30.06			$	29.35			$	28.90			$	28.61
Outstanding shares			35,625,822				35,614,953				35,557,110				35,530,734				35,521,541				35,511,943				35,463,269
(1) Estimated ratio at September 30, 2019

Sandy Spring Bancorp, Inc. and Subsidiaries
LOAN PORTFOLIO QUALITY DETAIL – UNAUDITED
			2019												2018
(Dollars in thousands)		September 30,				June 30,				March 31,				December 31,				September 30,				June 30,				March 31,
Non-Performing Assets:
Loans 90 days past due:
Commercial business		$	17			$	–			$	–			$	49			$	150			$	6			$	–
Commercial real estate:
Commercial AD&C			–				–				–				–				1,261				–				–
Commercial investor real estate			1,201				1,248				–				–				–				–				–
Commercial owner occupied real estate			–				–				90				–				13				112				–
Consumer			–				–				–				219				563				–				126
Residential real estate:
Residential mortgage			–				–				221				221				–				–				–
Residential construction			–				–				–				–				–				–				–
Total loans 90 days past due			1,218				1,248				311				489				1,987				118				126
Non-accrual loans:
Commercial business			6,393				7,083				8,013				7,086				6,352				6,883				6,634
Commercial real estate:
Commercial AD&C			829				1,990				3,306				3,306				136				136				136
Commercial investor real estate			8,454				6,409				6,071				5,355				5,861				5,878				5,813
Commercial owner occupied real estate			3,810				3,766				5,992				4,234				3,352				3,440				3,524
Consumer			4,561				4,439				4,081				4,107				4,098				4,298				3,244
Residential real estate:
Residential mortgage			12,574				10,625				9,704				9,336				9,134				6,251				7,063
Residential construction			–				–				156				159				163				168				174
Total non-accrual loans			36,621				34,312				37,323				33,583				29,096				27,054				26,588
Total restructured loans – accruing			2,287				2,133				2,479				1,942				2,224				1,663				2,678
Total non-performing loans			40,126				37,693				40,113				36,014				33,307				28,835				29,392
Other assets and real estate owned (OREO)			1,482				1,486				1,410				1,584				2,118				2,361				2,761
Total non-performing assets		$	41,608			$	39,179			$	41,523			$	37,598			$	35,425			$	31,196			$	32,153
		For the Quarter Ended,
		September 30,				June 30,				March 31,				December 31,				September 30,				June 30,				March 31,
(Dollars in thousands)		2019				2019				2019				2018				2018				2018				2018
Analysis of Non-accrual Loan Activity:
Balance at beginning of period		$	34,312			$	37,323			$	33,583			$	29,096			$	27,054			$	26,588			$	26,336
Non-accrual balances transferred to OREO			–				(195	)			–				–				–				–				(289	)
Non-accrual balances charged-off			(705	)			(604	)			(227	)			(360	)			(91	)			(144	)			(411	)
Net payments or draws			(2,903	)			(5,517	)			(1,786	)			(1,126	)			(1,777	)			(1,635	)			(357	)
Loans placed on non-accrual			6,015				3,396				6,202				5,973				4,193				2,245				1,309
Non-accrual loans brought current			(98	)			(91	)			(449	)			–				(283	)			–				–
Balance at end of period		$	36,621			$	34,312			$	37,323			$	33,583			$	29,096			$	27,054			$	26,588
Analysis of Allowance for Loan Losses:
Balance at beginning of period		$	54,024			$	53,089			$	53,486			$	50,409			$	48,493			$	46,931			$	45,257
Provision (credit) for loan losses			1,524				1,633				(128	)			3,403				1,890				1,733				1,997
Less loans charged-off, net of recoveries:
Commercial business			389				735				7				(9	)			(49	)			(73	)			322
Commercial real estate:
Commercial AD&C			(224	)			(4	)			–				–				–				–				(62	)
Commercial investor real estate			(3	)			(3	)			(7	)			109				(49	)			(8	)			(8	)
Commercial owner occupied real estate			–				–				–				–				–				–				–
Consumer			187				(18	)			182				45				85				244				99
Residential real estate:
Residential mortgage			209				(10	)			89				183				(11	)			13				(22	)
Residential construction			(2	)			(2	)			(2	)			(2	)			(2	)			(5	)			(6	)
Net charge-offs			556				698				269				326				(26	)			171				323
Balance at end of period		$	54,992			$	54,024			$	53,089			$	53,486			$	50,409			$	48,493			$	46,931
Asset Quality Ratios:
Non-performing loans to total loans			0.61	%			0.58	%			0.61	%			0.55	%			0.52	%			0.46	%			0.48	%
Non-performing assets to total assets			0.49	%			0.47	%			0.50	%			0.46	%			0.44	%			0.38	%			0.41	%
Allowance for loan losses to loans			0.83	%			0.82	%			0.81	%			0.81	%			0.79	%			0.78	%			0.77	%
Allowance for loan losses to non-performing loans			137.05	%			143.33	%			132.35	%			148.51	%			151.35	%			168.17	%			159.67	%
Annualized net charge-offs to average loans			0.03	%			0.04	%			0.02	%			0.02	%			0.00	%			0.01	%			0.02	%

Sandy Spring Bancorp, Inc. and Subsidiaries
CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES – UNAUDITED
		Three Months Ended September 30,
		2019											2018
										Annualized											Annualized
		Average				(1)				Average			Average				(1)				Average
(Dollars in thousands and tax-equivalent)		Balances				Interest				Yield/Rate			Balances				Interest				Yield/Rate
Assets
Residential mortgage loans		$	1,215,132			$	11,649			3.83	%		$	1,122,946			$	10,485			3.73	%
Residential construction loans			162,196				1,746			4.27				215,578				2,160			3.98
Total mortgage loans			1,377,328				13,395			3.89				1,338,524				12,645			3.77
Commercial AD&C loans			651,905				9,705			5.91				632,354				9,185			5.76
Commercial investor real estate loans			1,982,979				24,342			4.87				1,905,427				25,735			5.36
Commercial owner occupied real estate loans			1,258,000				15,749			4.97				1,190,865				14,484			4.83
Commercial business loans			786,150				10,350			5.22				700,791				9,196			5.21
Total commercial loans			4,679,034				60,146			5.10				4,429,437				58,600			5.25
Consumer loans			486,865				6,132			5.00				524,605				6,011			4.59
Total loans (2)			6,543,227				79,673			4.84				6,292,566				77,256			4.88
Loans held for sale			61,870				572			3.70				29,939				336			4.49
Taxable securities			744,461				5,504			2.95				720,317				5,342			2.97
Tax-exempt securities (3)			196,587				1,695			3.45				276,048				2,442			3.54
Total investment securities (4)			941,048				7,199			3.06				996,365				7,784			3.12
Interest-bearing deposits with banks			143,865				783			2.16				51,683				211			1.62
Federal funds sold			619				2			1.42				1,983				8			1.58
Total interest-earning assets			7,690,629				88,229			4.56				7,372,536				85,595			4.61
Less: allowance for loan losses			(54,147	)										(49,194	)
Cash and due from banks			64,154											64,653
Premises and equipment, net			60,537											62,452
Other assets			609,616											536,078
Total assets		$	8,370,789										$	7,986,525
Liabilities and Stockholders’ Equity
Interest-bearing demand deposits		$	749,720				545			0.29	%		$	703,905				231			0.13	%
Regular savings deposits			326,913				110			0.13				347,299				93			0.11
Money market savings deposits			1,781,173				6,721			1.50				1,625,481				5,330			1.30
Time deposits			1,638,072				8,956			2.17				1,284,376				5,119			1.58
Total interest-bearing deposits			4,495,878				16,332			1.44				3,961,061				10,773			1.08
Other borrowings			146,939				257			0.69				188,133				383			0.81
Advances from FHLB			522,719				3,222			2.45				890,040				5,141			2.29
Subordinated debentures			37,340				481			5.15				37,483				486			5.19
Total interest-bearing liabilities			5,202,876				20,292			1.55				5,076,717				16,783			1.31
Noninterest-bearing demand deposits			1,909,884											1,822,931
Other liabilities			134,844											56,710
Stockholders’ equity			1,123,185											1,030,167
Total liabilities and stockholders’ equity		$	8,370,789										$	7,986,525
Net interest income and spread						$	67,937			3.01	%						$	68,812			3.30	%
Less: tax-equivalent adjustment							1,147											1,221
Net interest income						$	66,790										$	67,591
Interest income/earning assets										4.56	%										4.61	%
Interest expense/earning assets										1.05											0.90
Net interest margin										3.51	%										3.71	%
(1) Tax-equivalent income has been adjusted using the combined marginal federal and state rate of 26.13% for 2019 and 2018. The annualized taxable-equivalent adjustments utilized in
the above table to compute yields aggregated to $1.1 million and $1.2 million in 2019 and 2018, respectively.
(2) Non-accrual loans are included in the average balances.
(3) Includes only investments that are exempt from federal taxes.
(4) Available for sale investments are presented at amortized cost.

Sandy Spring Bancorp, Inc. and Subsidiaries
CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES – UNAUDITED
		Nine Months Ended September 30,
		2019											2018
										Annualized											Annualized
		Average				(1)				Average			Average				(1)				Average
(Dollars in thousands and tax-equivalent)		Balances				Interest				Yield/Rate			Balances				Interest				Yield/Rate
Assets
Residential mortgage loans		$	1,229,790			$	35,408			3.84	%		$	1,091,515			$	30,280			3.70	%
Residential construction loans			175,236				5,582			4.26				210,774				6,203			3.93
Total mortgage loans			1,405,026				40,990			3.89				1,302,289				36,483			3.74
Commercial AD&C loans			671,375				29,853			5.95				597,283				25,592			5.73
Commercial investor real estate loans			1,969,599				74,428			5.05				1,939,205				71,824			4.95
Commercial owner occupied real estate loans			1,227,327				44,975			4.90				1,106,032				39,051			4.72
Commercial business loans			774,375				31,479			5.43				674,973				26,052			5.16
Total commercial loans			4,642,676				180,735			5.20				4,317,493				162,519			5.03
Consumer loans			502,476				18,797			5.00				531,539				17,310			4.41
Total loans (2)			6,550,178				240,522			4.91				6,151,321				216,312			4.70
Loans held for sale			39,107				1,145			3.91				30,349				983			4.32
Taxable securities			752,518				17,169			3.04				738,580				15,891			2.87
Tax-exempt securities (3)			219,510				5,827			3.54				290,177				7,662			3.52
Total investment securities (4)			972,028				22,996			3.15				1,028,757				23,553			3.05
Interest-bearing deposits with banks			83,981				1,405			2.24				86,446				1,082			1.67
Federal funds sold			623				8			1.78				2,607				28			1.41
Total interest-earning assets			7,645,917				266,076			4.65				7,299,480				241,958			4.43
Less: allowance for loan losses			(53,440	)										(47,533	)
Cash and due from banks			64,227											69,301
Premises and equipment, net			61,039											61,507
Other assets			590,186											535,778
Total assets		$	8,307,929										$	7,918,533
Liabilities and Stockholders’ Equity
Interest-bearing demand deposits		$	733,872				1,305			0.24	%		$	730,520				657			0.12	%
Regular savings deposits			330,377				321			0.13				390,231				488			0.17
Money market savings deposits			1,710,520				19,617			1.53				1,520,953				13,028			1.15
Time deposits			1,629,716				25,715			2.11				1,245,510				12,410			1.33
Total interest-bearing deposits			4,404,485				46,958			1.43				3,887,214				26,583			0.91
Other borrowings			158,279				945			0.80				158,939				599			0.50
Advances from FHLB			689,224				13,389			2.60				1,000,060				15,557			2.08
Subordinated debentures			37,376				1,462			5.22				37,518				1,436			5.11
Total interest-bearing liabilities			5,289,364				62,754			1.59				5,083,731				44,175			1.16
Noninterest-bearing demand deposits			1,797,301											1,757,573
Other liabilities			122,564											59,371
Stockholders’ equity			1,098,700											1,017,858
Total liabilities and stockholders’ equity		$	8,307,929										$	7,918,533
Net interest income and spread						$	203,322			3.06	%						$	197,783			3.27	%
Less: tax-equivalent adjustment							3,597											3,483
Net interest income						$	199,725										$	194,300
Interest income/earning assets										4.65	%										4.43	%
Interest expense/earning assets										1.10											0.81
Net interest margin										3.55	%										3.62	%
(1) Tax-equivalent income has been adjusted using the combined marginal federal and state rate of 26.13% for 2019 and 2018. The annualized taxable-equivalent adjustments utilized in
the above table to compute yields aggregated to $3.6 million and $3.5 million in 2019 and 2018, respectively.
(2) Non-accrual loans are included in the average balances.
(3) Includes only investments that are exempt from federal taxes.
(4) Available for sale investments are presented at amortized cost.