Wintrust Financial Corporation Reports Record Third Quarter 2019 Net Income of $99.1 million and Year-to-Date Net Income of $269.7 million

ROSEMONT, Ill., Oct. 16, 2019 (GLOBE NEWSWIRE) — Wintrust Financial Corporation (“Wintrust” or “the Company”) (Nasdaq: WTFC) announced net income of $99.1 million or $1.69 per diluted common share for the third quarter of 2019, an increase in diluted earnings per common share of 22.5% compared to the prior quarter and 7.6% compared to the third quarter of 2018. The Company recorded net income of $269.7 million or $4.60 per diluted common share for the first nine months of 2019 compared to net income of $263.5 million or $4.50 per diluted common share for the same period of 2018.

Highlights of the Third Quarter of 2019:
Comparative information to the second quarter of 2019

Total assets increased by $1.3 billion or 15% on an annualized basis.
Total loans increased by $406 million or 6% on an annualized basis.
Total deposits increased by $1.2 billion or 17% on an annualized basis, the increase was net of a $552 million reduction in brokered deposits.
Mortgage banking production revenue increased by $12.8 million as mortgage loans originated for sale totaled $1.4 billion in the third quarter of 2019 as compared to $1.2 billion in the second quarter of 2019.
Net interest income decreased by $1.3 million as a 25 basis point decline in net interest margin was partially offset by a $1.7 billion increase in average earning assets.
The net overhead ratio declined by 24 basis points to 1.40%, effectively offsetting the impact of the net interest margin decline.
Recorded net charge-offs of $9.4 million in the third quarter of 2019 as compared to $22.3 million in the second quarter of 2019. The $9.4 million includes $4.0 million of additional net charge-offs related to the three non-performing credits disclosed in the second quarter of 2019.
The ratio of non-performing assets to total assets declined by two basis points to 0.38%.

Other highlights of the third quarter of 2019

Total period end loans were $364 million higher than average total loans in the current quarter.
Loans to deposits ratio ended the period at 89.6%.
Recorded a $3.9 million reduction to FDIC insurance expense related to assessment credits received from the FDIC.
Recorded a reduction in value of mortgage servicing rights related to changes in fair value model assumptions, net of derivative contract activity held as an economic hedge, of $4.0 million.
Recorded acquisition related costs of $1.3 million in the third quarter of 2019 as compared to $238,000 in the second quarter of 2019.

Expansion activity

Opened two new branches in the city of Chicago.
Completed the previously announced acquisition of STC Bancshares Corp., the parent company of STC Capital Bank, early in the fourth quarter of 2019. STC Capital Bank had approximately $190 million in loans and approximately $244 million in deposits as of June 30, 2019.
Announced an agreement to acquire SBC, Incorporated, the parent company of Countryside Bank, which is expected to close in the fourth quarter of 2019. Countryside Bank had approximately $420 million in loans and approximately $511 million in deposits as of June 30, 2019.

Edward J. Wehmer, President and Chief Executive Officer, commented, “Wintrust reported record net income of $99.1 million for the third quarter of 2019, up from $81.5 million in the second quarter of 2019. The Company experienced strong balance sheet growth as total assets were $1.3 billion higher than the prior quarter end and $4.8 billion higher than at the third quarter of 2018. The third quarter was characterized by strong balance sheet growth, decreased net interest margin, increased mortgage banking revenue, improved credit quality, and a continued focus to increase franchise value in our market area.”

Mr. Wehmer continued, “The Company experienced significant growth in retail deposits demonstrating the value of our local brand and branch network. We are pleased to now have the largest deposit base in the Chicago market area among locally headquartered banks. Total deposits increased by $1.2 billion in the third quarter of 2019 which was net of a reduction of $552 million in brokered deposits to optimize our funding base. Non-brokered deposits now comprise approximately 96% of total deposits. Additionally, the Company grew total loans by $406 million with growth diversified across various loan portfolios including the commercial real estate, commercial premium finance receivables, life insurance premium finance receivables and residential real estate portfolios. We remain aggressive in growing quality assets that meet our standards and will seek to fund that by expanding deposit market share and household penetration.”

Mr. Wehmer commented, “Net interest margin declined by 25 basis points in the third quarter of 2019 as compared to the second quarter of 2019 primarily due to downward repricing of variable rate loans and increased levels of interest bearing cash. However, net interest income only decreased slightly as compared to the prior quarter due to growth in earning assets. We expect to begin to realize the benefit of declining deposit rates in the fourth quarter of 2019 as this typically lags changes in the interest rate environment. We plan to deploy the excess liquidity gathered in the third quarter of 2019 to enhance net interest income and also believe that the announced acquisitions will be accretive to net interest margin. As always, we will strive to grow without a commensurate increase in expenses and will primarily measure that with the net overhead ratio which improved to 1.40%, or by 24 basis points in the third quarter compared to the prior quarter.”

Mr. Wehmer noted, “Our mortgage banking business production increased in the current quarter as loan volumes originated for sale increased to $1.4 billion from $1.2 billion in the second quarter of 2019. The favorable increase in origination volumes was primarily a result of increased refinancing activity due to the declining interest rate environment. Additionally, production margin expanded due to strategic efforts to enhance our origination channel mix. Declining long-term interest rates also contributed to a $7.2 million reduction in our mortgage servicing rights portfolio related to payoffs and paydowns as well as a $4.0 million reduction due to changes in fair value assumptions, net of hedging gain. However, those declines were more than offset by capitalization of retained servicing rights of $14.0 million in the current quarter. We continue to focus on efficiencies in our delivery channels and our operating costs in our mortgage banking area. We believe that the mortgage rate outlook bodes well for mortgage origination demand in future quarters.”

Commenting on credit quality, Mr. Wehmer stated, “Overall credit quality metrics improved in the third quarter of 2019. The Company recorded net charge-offs of $9.4 million in the third quarter of 2019 as compared to $22.3 million in the second quarter of 2019. The $9.4 million includes $4.0 million of additional net charge-offs (which were substantially reserved for in prior quarters) related to the three non-performing credits disclosed in the second quarter of 2019 and represents a return to lower levels of net charge-offs. These three credits are substantially resolved and are not expected to materially impact future quarters. The ratio of non-performing assets as a percent of total assets declined by two basis points to a historically low level of 0.38%. We believe that the Company’s reserves remain appropriate and we remain diligent in our review of credit.”

Turning to the future, Mr. Wehmer stated, “We have experienced significant franchise growth in 2019 and believe that our opportunities for both internal and external growth remain consistently strong. We plan to continue our steady and measured approach to achieve our main objectives of growing franchise value, increasing profitability, leveraging our expense infrastructure and continuing to increase shareholder value. Evaluating strategic acquisitions, like the recently completed acquisition of STC Bancshares Corp. and the announced acquisition of SBC, Incorporated, as well as focusing on organic branch growth will continue to be a part of our overall growth strategy with the goal of becoming Chicago’s bank and Wisconsin’s bank.”

The graphs below illustrate certain highlights of the third quarter of 2019.
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SUMMARY OF RESULTS:

BALANCE SHEET

Total assets grew by $1.3 billion in the third quarter of 2019 primarily due to an $823.7 million increase in interest bearing deposits with banks and $405.5 million of loan growth. There were no material additions to the Company’s investment portfolio during the current quarter due to the lack of acceptable financial returns given the current interest rate environment. The Company believes that the $2.3 billion of interest bearing deposits with banks held as of September 30, 2019 is more than sufficient liquidity to operate its business plan. Excess liquidity is expected to be deployed in future quarters to enhance net interest income.

Total liabilities grew by $1.2 billion in the third quarter of 2019 primarily comprised of a $1.2 billion increase in total deposits. The Company successfully leveraged its retail deposit base in the third quarter of 2019 to generate new deposits. In addition, the total deposit growth was net of a $552 million reduction in brokered deposits. Management believes in substantially funding the Company’s balance sheet with core deposits and utilizes brokered or wholesale funding sources as appropriate to manage its liquidity position as well as for interest rate risk management purposes. Non-brokered deposits now comprise approximately 96% of total deposits.

For more information regarding changes in the Company’s balance sheet, see Consolidated Statements of Condition and Tables 1 through 4 in this report.

NET INTEREST INCOME

For the third quarter of 2019, net interest income totaled $264.9 million, a decrease of $1.3 million as compared to the second quarter of 2019 and an increase of $17.3 million as compared to the third quarter of 2018. The $1.3 million decrease in net interest income in the third quarter of 2019 compared to the second quarter of 2019 was attributable to a $16.3 million decrease due to a reduction in net interest margin partially offset by a $12.1 million increase related to balance sheet growth and a $2.9 million increase from one more day in the quarter.

Net interest margin was 3.37% (3.39% on a fully taxable-equivalent basis, non-GAAP) during the third quarter of 2019 compared to 3.62% (3.64% on a fully taxable-equivalent basis, non-GAAP) during the second quarter of 2019 and 3.59% (3.61% on a fully taxable-equivalent basis, non-GAAP) during the third quarter of 2018. The 25 basis point decrease in net interest margin in the third quarter of 2019 as compared to the second quarter of 2019 was attributable to a 21 basis point decline in the yield on earnings assets and a five basis point increase in the rate paid on interest bearing liabilities, partially offset by a one basis point increase in the net free funds contribution. The 21 basis point decline in the yield on earning assets in the current quarter as compared to the second quarter of 2019 was primarily due to a 14 basis point decline in the yield on loans along with the impact of a higher average balance of interest bearing cash. The five basis point increase in the rate paid on interest bearing liabilities in the current quarter as compared to the prior quarter is primarily due to a six basis point increase on the rate paid on interest bearing deposits largely due to retail deposit promotions.

For the first nine months of 2019, net interest income totaled $793.0 million, an increase of $82.2 million as compared to the first nine months of 2018. Net interest margin was 3.56% (3.58% on a fully taxable-equivalent basis, non-GAAP) for the first nine months of 2019 compared to 3.58% (3.60% on a fully taxable-equivalent basis, non-GAAP) for the first nine months of 2018.

For more information regarding net interest income, see Tables 5 through 10 in this report.

ASSET QUALITY

The allowance for credit losses is comprised of the allowance for loan losses and the allowance for unfunded lending-related commitments. The allowance for loan losses is a reserve against loan amounts that are actually funded and outstanding while the allowance for unfunded lending-related commitments (separate liability account) relates to certain amounts that Wintrust is committed to lend but for which funds have not yet been disbursed. The provision for credit losses may contain both a component related to funded loans (provision for loan losses) and a component related to lending-related commitments (provision for unfunded loan commitments and letters of credit).

Net charge-offs as a percentage of average total loans, in the third quarter of 2019 totaled 15 basis points on an annualized basis compared to 36 basis points on an annualized basis in the second quarter of 2019 and eight basis points on an annualized basis in the third quarter of 2018. Net charge-offs totaled $9.4 million in the third quarter of 2019, a $12.8 million decrease from $22.3 million in the second quarter of 2019 and a $4.8 million increase from $4.7 million in the third quarter of 2018. The $9.4 million of net charge-offs in the current quarter includes $4.0 million of additional net charge-offs (which were substantially reserved for in prior quarters) related to the three non-performing credits disclosed in the second quarter of 2019 and represents a return to lower levels of net charge-offs. These three credits are substantially resolved and are not expected to materially impact future quarters. The provision for credit losses totaled $10.8 million for the third quarter of 2019 compared to $24.6 million for the second quarter of 2019 and $11.0 million for the third quarter of 2018. For more information regarding net charge-offs, see Table 11 in this report.

Management believes the allowance for credit losses is appropriate to provide for inherent losses in the portfolio. There can be no assurances, however, that future losses will not exceed the amounts provided for, thereby affecting future results of operations. The amount of future additions to the allowance for credit losses will be dependent upon management’s assessment of the appropriateness of the allowance based on its evaluation of economic conditions, changes in real estate values, interest rates, the regulatory environment, the level of past-due and non-performing loans and other factors.

As part of the regular quarterly review performed by management to determine if the Company’s allowance for loan losses is appropriate, an analysis is prepared on the loan portfolio based upon a breakout of core loans and consumer, niche and purchased loans. A summary of the allowance for loan losses calculated for the loan components in both the core loan portfolio and the consumer, niche and purchased loan portfolio as of September 30, 2019 and June 30, 2019 is shown on Table 12 of this report.

As of September 30, 2019, $51.1 million of all loans, or 0.2%, were 60 to 89 days past due and $134.2 million, or 0.5%, were 30 to 59 days (or one payment) past due. As of June 30, 2019, $54.9 million of all loans, or 0.2%, were 60 to 89 days past due and $129.1 million, or 0.5%, were 30 to 59 days (or one payment) past due. Many of the commercial and commercial real estate loans shown as 60 to 89 days and 30 to 59 days past due are included on the Company’s internal problem loan reporting system. Loans on this system are closely monitored by management on a monthly basis.

The Company’s home equity and residential loan portfolios continue to exhibit low delinquency ratios. Home equity loans at September 30, 2019 that are current with regard to the contractual terms of the loan agreement represent 97.8% of the total home equity portfolio. Residential real estate loans at September 30, 2019 that are current with regards to the contractual terms of the loan agreements comprise 98.4% of total residential real estate loans outstanding. For more information regarding past due loans, see Table 13 in this report.

Purchased loans acquired in a business combination are recorded at estimated fair value on their purchase date. In accordance with accounting guidance, credit deterioration on purchased loans is recorded as a credit discount at the time of purchase. In addition to the $161.8 million of allowance for loan losses, there was $6.8 million of non-accretable credit discount on purchased loans reported in accordance with ASC 310-30 that is available to absorb credit losses as of September 30, 2019.

The ratio of non-performing assets to total assets was 0.38% as of September 30, 2019, compared to 0.40% at June 30, 2019, and 0.52% at September 30, 2018. Non-performing assets, excluding PCI loans, totaled $132.0 million at September 30, 2019, compared to $133.5 million at June 30, 2019 and $155.8 million at September 30, 2018. Non-performing loans, excluding PCI loans, totaled $114.3 million, or 0.44% of total loans, at September 30, 2019 compared to $113.4 million, or 0.45% of total loans, at June 30, 2019 and $127.2 million, or 0.55% of total loans, at September 30, 2018. Other real estate owned (“OREO”) of $17.5 million at September 30, 2019 decreased $2.3 million compared to $19.8 million at June 30, 2019 and decreased $10.8 million compared to $28.3 million at September 30, 2018. Management is pursuing the resolution of all non-performing assets. At this time, management believes reserves are appropriate to absorb inherent losses and OREO is appropriately valued at the lower of carrying value or fair value less estimated costs to sell. For more information regarding non-performing assets, see Table 14 in this report.

NON-INTEREST INCOME

Wealth management revenue decreased by $140,000 during the third quarter of 2019 as compared to the second quarter of 2019 primarily due to decreased brokerage commissions. Wealth management revenue is comprised of the trust and asset management revenue of The Chicago Trust Company and Great Lakes Advisors, the brokerage commissions, managed money fees and insurance product commissions at Wintrust Investments and fees from tax-deferred like-kind exchange services provided by the Chicago Deferred Exchange Company.

Mortgage banking revenue increased by $13.5 million in the third quarter of 2019 as compared to the second quarter of 2019 primarily as a result of higher production revenues and an increase in the fair value of the mortgage servicing rights portfolio in the third quarter of 2019. Production revenue increased by $12.8 million in the third quarter of 2019 as compared to the second quarter of 2019 primarily due to an increase in origination volumes as a result of increased refinancing activity. The percentage of origination volume from refinancing activities was 52% in the third quarter of 2019 as compared to 37% in the second quarter of 2019. Additionally, production margin improved from 2.59% in the second quarter of 2019 to 3.01% in the third quarter of 2019 primarily due to a favorable shift in origination channel mix. Mortgage banking revenue includes revenue from activities related to originating, selling and servicing residential real estate loans for the secondary market.

During the third quarter of 2019, the fair value of the mortgage servicing rights portfolio increased as retained servicing rights led to the capitalization of $14.0 million partially offset by negative fair value adjustments of $4.1 million and a reduction in value of $7.2 million due to payoffs and paydowns of the existing portfolio. The Company purchased an option at the beginning of the third quarter of 2019 to economically hedge a portion of the potential negative fair value changes recorded in earnings related to its mortgage servicing rights portfolio. The option was exercised during the current quarter resulting in a net gain of $82,000 which was recorded in mortgage banking revenue.

The net gains recognized on investment securities in the third quarter of 2019 and second quarter of 2019, respectively, were primarily due to gains on investment securities that were called and unrealized gains recognized on equity securities held by the Company.

Other non-interest income increased by $3.4 million in the third quarter of 2019 as compared to the second quarter of 2019 primarily due to increased income from investments in partnerships and interest rate swaps.

For more information regarding non-interest income, see Tables 15 and 16 in this report.

NON-INTEREST EXPENSE

Salaries and employee benefits expense increased by $7.3 million in the third quarter of 2019 as compared to the second quarter of 2019. The $7.3 million increase is comprised of an increase of $2.7 million in salaries expense, $3.8 million in commissions and incentive compensation and $782,000 in benefits expense. The increase in salaries expense is primarily due to increased staffing as the Company grows and acquisition related expenses. Commissions and incentive compensation increased in the current quarter primarily related to the increased volume of mortgage originations for sale. The increase in benefits expense relates primarily to increases in employee insurance expense in the current quarter.

Equipment expense totaled $13.3 million in the third quarter of 2019, an increase of $555,000 as compared to the second quarter of 2019. The increase in the current quarter relates primarily to increased software licensing expenses.

Advertising and marketing expenses in the third quarter of 2019 increased by $530,000 as compared to the second quarter of 2019 primarily related to higher corporate sponsorship costs as well as increased spending related to deposit generation and brand awareness to grow our loan and deposit portfolios. The level of marketing expenditures depends on the timing of sponsorship programs utilized which are determined based on the market area, targeted audience, competition and various other factors.

FDIC insurance expense totaled $148,000 in the third quarter of 2019, a decrease of $4.0 million as compared to the second quarter of 2019. The decrease in the current quarter relates primarily to FDIC assessment credits received by the 15 Wintrust affiliate banks.

Professional fees expense totaled $8.0 million in the third quarter of 2019, an increase of $1.8 million as compared to the second quarter of 2019. The increase in the current quarter relates primarily to increased fees on consulting services and legal fees. Professional fees include legal, audit, and tax fees, external loan review costs, consulting arrangements and normal regulatory exam assessments.

For more information regarding non-interest expense, see Table 17 in this report.

INCOME TAXES

The Company recorded income tax expense of $35.5 million in the third quarter of 2019 compared to $28.7 million in the second quarter of 2019 and $30.9 million in the third quarter of 2018. The effective tax rates were 26.36% in the third quarter of 2019 compared to 26.06% in the second quarter of 2019 and 25.13% in the third quarter of 2018. During the first nine months of 2019, the Company recorded income tax expense of $93.7 million compared to $89.0 million for the first nine months of 2018. The effective tax rates were 25.78% for the first nine months of 2019 and 25.24% for the first nine months of 2018.

The year-to-date effective tax rates were impacted by excess tax benefits related to share-based compensation. These excess tax benefits were $1.7 million in the first nine months of 2019 and $3.7 million in the first nine months of 2018. Excess tax benefits are expected to be higher in the first quarter when the majority of the Company’s shared-based awards vest, and will fluctuate throughout the year based on the Company’s stock price and timing of employee stock option exercises and vesting of other share-based awards.

BUSINESS UNIT SUMMARY

Community Banking

Through its community banking unit, the Company provides banking and financial services primarily to individuals, small to mid-sized businesses, local governmental units and institutional clients residing primarily in the local areas the Company services. In the third quarter of 2019, this unit generated significant retail deposit growth. However, the banking segment also experienced net interest margin compression in part due to current market conditions.

Mortgage banking revenue increased from $37.4 million for the second quarter of 2019 to $50.9 million for the third quarter of 2019. Services charges on deposit accounts totaled $10.0 million in the third quarter of 2019 an increase of $695,000 as compared to the second quarter of 2019 primarily due to higher account analysis fees. The Company’s gross commercial and commercial real estate loan pipelines remain strong. Before the impact of scheduled payments and prepayments, gross commercial and commercial real estate loan pipelines were estimated to be approximately $1.2 billion to $1.3 billion at September 30, 2019. When adjusted for the probability of closing, the pipelines were estimated to be approximately $730 million to $810 million at September 30, 2019.

Specialty Finance

Through its specialty finance unit, the Company offers financing of insurance premiums for businesses and individuals, equipment financing through structured loans and lease products to customers in a variety of industries and accounts receivable financing, value-added, out-sourced administrative services, and other services. In the third quarter of 2019, the specialty finance unit experienced higher revenue primarily as a result of increased volumes within its insurance premium financing receivables portfolio. Originations within the insurance premium financing receivables portfolio were $2.4 billion during the third quarter of 2019 and average balances increased by $446.4 million as compared to the second quarter of 2019. The increase in average balances primarily resulted in a $6.5 million increase in interest income attributed to the insurance premium finance receivables portfolio. The Company’s leasing business grew during the third quarter of 2019, with its portfolio of assets, including capital leases, loans and equipment on operating leases, increasing $98.0 million to $1.5 billion at the end of the third quarter of 2019. Revenues from the Company’s out-sourced administrative services business increased to $1.1 million in the third quarter of 2019 as compared to $1.0 million in the second quarter of 2019.

Wealth Management

Through four separate subsidiaries within its wealth management unit, the Company offers a full range of wealth management services, including trust and investment services, tax-deferred like-kind exchange services, asset management, securities brokerage services and 401(k) and retirement plan services. Wealth management revenue decreased by $140,000 in the third quarter of 2019 compared to the second quarter of 2019, totaling $24.0 million in the current period. At September 30, 2019, the Company’s wealth management subsidiaries had approximately $26.1 billion of assets under administration, which included $3.3 billion of assets owned by the Company and its subsidiary banks, representing a $188.4 million increase from the $25.9 billion of assets under administration at June 30, 2019. The increase in the third quarter of 2019 was primarily due to increased business.

ITEMS IMPACTING COMPARATIVE FINANCIAL RESULTS

Acquisitions

On May 24, 2019, the Company completed the Oak Bank Acquisition. Through this business combination, the Company acquired Oak Bank’s one banking location in Chicago, Illinois, as well as approximately $223.8 million in assets, including approximately $126.1 million in loans, and approximately $161.2 million in deposits. The Company recorded goodwill of $10.7 million on the acquisition.

On December 14, 2018, the Company acquired Elektra Holding Company, LLC (“Elektra”), the parent company of Chicago Deferred Exchange Company, LLC (“CDEC”). CDEC is a provider of Qualified Intermediary services (as defined by U.S. Treasury regulations) for taxpayers seeking to structure tax-deferred like-kind exchanges under Internal Revenue Code Section 1031. CDEC has successfully facilitated more than 8,000 like-kind exchanges in the past decade for taxpayers nationwide. These transactions typically generate customer deposits during the period following the sale of the property until such proceeds are used to purchase a replacement property. The Company recorded goodwill of $37.6 million on the acquisition.

On December 7, 2018, the Company completed its acquisition of certain assets and the assumption of certain liabilities of American Enterprise Bank (“AEB”). Through this asset acquisition, the Company acquired approximately $164.0 million in assets, including approximately $119.3 million in loans, and approximately $150.8 million in deposits.

On August 1, 2018, the Company completed its acquisition of Chicago Shore Corporation (“CSC”). CSC was the parent company of Delaware Place Bank. Through this business combination, the Company acquired Delaware Place Bank’s one banking location in Chicago, Illinois as well as approximately $282.8 million in assets, including approximately $152.7 million in loans, and approximately $213.1 million in deposits. The Company recorded goodwill of $26.6 million on the acquisition.

On January 4, 2018, the Company acquired iFreedom Direct Corporation DBA Veterans First Mortgage (“Veterans First”) with assets including mortgage-servicing-rights on approximately 10,000 loans, totaling an estimated $1.6 billion in unpaid principal balance. The Company recorded goodwill of $9.1 million on the acquisition.

WINTRUST FINANCIAL CORPORATION
Key Operating Measures

Wintrust’s key operating measures and growth rates for the third quarter of 2019, as compared to the second quarter of 2019 (sequential quarter) and third quarter of 2018 (linked quarter), are shown in the table below:

										% or⁽⁴⁾ basis point (bp) change from 2nd Quarter 2019			% or basis point (bp) change from 3rd Quarter 2018
	Three Months Ended
(Dollars in thousands, except per share data)	Sep 30, 2019			Jun 30, 2019			Sep 30, 2018
Net income	$	99,121		$	81,466		$	91,948		22		%	8		%
Net income per common share – diluted	1.69			1.38			1.57			22			8
Net revenue ⁽¹⁾	379,989			364,360			347,493			4			9
Net interest income	264,852			266,202			247,563			(1	)		7
Net interest margin	3.37		%	3.62		%	3.59		%	(25	)	bp	(22	)	bp
Net interest margin – fully taxable equivalent (non-GAAP) ⁽²⁾	3.39			3.64			3.61			(25	)		(22	)
Net overhead ratio ⁽³⁾	1.40			1.64			1.53			(24	)		(13	)
Return on average assets	1.16			1.02			1.24			14			(8	)
Return on average common equity	11.42			9.68			11.86			174			(44	)
Return on average tangible common equity (non-GAAP) ⁽²⁾	14.36			12.28			14.64			208			(28	)
At end of period
Total assets	$	34,911,902		$	33,641,769		$	30,142,731		15		%	16		%
Total loans ⁽⁵⁾	25,710,171			25,304,659			23,123,951			6			11
Total deposits	28,710,379			27,518,815			24,916,715			17			15
Total shareholders’ equity	3,540,325			3,446,950			3,179,822			11			11

Net revenue is net interest income plus non-interest income.
See “Supplemental Non-GAAP Financial Measures/Ratios” at Table 18 for additional information on this performance measure/ratio.
The net overhead ratio is calculated by netting total non-interest expense and total non-interest income, annualizing this amount, and dividing by that period’s average total assets. A lower ratio indicates a higher degree of efficiency.
Period-end balance sheet percentage changes are annualized.
Excludes mortgage loans held-for-sale.

Certain returns, yields, performance ratios, or quarterly growth rates are “annualized” in this presentation to represent an annual time period. This is done for analytical purposes to better discern for decision-making purposes underlying performance trends when compared to full-year or year-over-year amounts. For example, a 5% growth rate for a quarter would represent an annualized 20% growth rate. Additional supplemental financial information showing quarterly trends can be found on the Company’s website at www.wintrust.com by choosing “Financial Reports” under the “Investor Relations” heading, and then choosing “Financial Highlights.”

WINTRUST FINANCIAL CORPORATION
Selected Financial Highlights

	Three Months Ended															Nine Months Ended
(Dollars in thousands, except per share data)	Sep 30, 2019			Jun 30, 2019			Mar 31, 2019			Dec 31, 2018			Sep 30, 2018			Sep 30, 2019			Sep 30, 2018
Selected Financial Condition Data (at end of period):
Total assets	$	34,911,902		$	33,641,769		$	32,358,621		$	31,244,849		$	30,142,731
Total loans ⁽¹⁾	25,710,171			25,304,659			24,214,629			23,820,691			23,123,951
Total deposits	28,710,379			27,518,815			26,804,742			26,094,678			24,916,715
Junior subordinated debentures	253,566			253,566			253,566			253,566			253,566
Total shareholders’ equity	3,540,325			3,446,950			3,371,972			3,267,570			3,179,822
Selected Statements of Income Data:
Net interest income	$	264,852		$	266,202		$	261,986		$	254,088		$	247,563		$	793,040		$	710,815
Net revenue ⁽²⁾	379,989			364,360			343,643			329,396			347,493			1,087,992			991,657
Net income	99,121			81,466			89,146			79,657			91,948			269,733			263,509
Net income per common share – Basic	1.71			1.40			1.54			1.38			1.59			4.65			4.57
Net income per common share – Diluted	1.69			1.38			1.52			1.35			1.57			4.60			4.50
Selected Financial Ratios and Other Data:
Performance Ratios:
Net interest margin	3.37		%	3.62		%	3.70		%	3.61		%	3.59		%	3.56		%	3.58		%
Net interest margin – fully taxable equivalent (non-GAAP) ⁽³⁾	3.39			3.64			3.72			3.63			3.61			3.58			3.60
Non-interest income to average assets	1.35			1.23			1.06			0.99			1.34			1.22			1.31
Non-interest expense to average assets	2.74			2.87			2.79			2.78			2.87			2.80			2.87
Net overhead ratio ⁽⁴⁾	1.40			1.64			1.72			1.79			1.53			1.58			1.56
Return on average assets	1.16			1.02			1.16			1.05			1.24			1.11			1.23
Return on average common equity	11.42			9.68			11.09			10.01			11.86			10.74			11.71
Return on average tangible common equity (non-GAAP) ⁽³⁾	14.36			12.28			14.14			12.48			14.64			13.60			14.47
Average total assets	$	33,954,592		$	32,055,769		$	31,216,171		$	30,179,887		$	29,525,109		$	32,418,875		$	28,640,380
Average total shareholders’ equity	3,496,714			3,414,340			3,309,078			3,200,654			3,131,943			3,407,398			3,064,396
Average loans to average deposits ratio	90.6		%	93.9		%	92.7		%	92.4		%	92.2		%	92.4		%	94.2		%
Period-end loans to deposits ratio	89.6			92.0			90.3			91.3			92.8
Common Share Data at end of period:
Market price per common share	$	64.63		$	73.16		$	67.33		$	66.49		$	84.94
Book value per common share	60.24			58.62			57.33			55.71			54.19
Tangible book value per common share (non-GAAP) ⁽³⁾	49.16			47.48			46.38			44.67			44.16
Common shares outstanding	56,698,429			56,667,846			56,638,968			56,407,558			56,377,169
Other Data at end of period:
Tier 1 leverage ratio ⁽⁵⁾	8.8		%	9.1		%	9.1		%	9.1		%	9.3		%
Risk-based capital ratios:
Tier 1 capital ratio ⁽⁵⁾	9.7			9.6			9.8			9.7			10.0
Common equity tier 1 capital ratio⁽⁵⁾	9.3			9.2			9.3			9.3			9.5
Total capital ratio ⁽⁵⁾	12.4			12.4			11.7			11.6			12.0
Allowance for credit losses ⁽⁶⁾	$	163,273		$	161,901		$	159,622		$	154,164		$	151,001
Non-performing loans	114,284			113,447			117,586			113,234			127,227
Allowance for credit losses to total loans ⁽⁶⁾	0.64		%	0.64		%	0.66		%	0.65		%	0.65		%
Non-performing loans to total loans	0.44			0.45			0.49			0.48			0.55
Number of:
Bank subsidiaries	15			15			15			15			15
Banking offices	174			172			170			167			166

Excludes mortgage loans held-for-sale.
Net revenue includes net interest income and non-interest income.
See “Supplemental Non-GAAP Financial Measures/Ratios” at Table 18 for additional information on this performance measure/ratio.
The net overhead ratio is calculated by netting total non-interest expense and total non-interest income, annualizing this amount, and dividing by that period’s total average assets. A lower ratio indicates a higher degree of efficiency.
Capital ratios for current quarter-end are estimated.
The allowance for credit losses includes both the allowance for loan losses and the allowance for unfunded lending-related commitments.

WINTRUST FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CONDITION

	(Unaudited)			(Unaudited)			(Unaudited)						(Unaudited)
	Sep 30,			Jun 30,			Mar 31,			Dec 31,			Sep 30,
(In thousands)	2019			2019			2019			2018			2018
Assets
Cash and due from banks	$	448,755		$	300,934		$	270,765		$	392,142		$	279,936
Federal funds sold and securities purchased under resale agreements	59			58			58			58			57
Interest bearing deposits with banks	2,260,806			1,437,105			1,609,852			1,099,594			1,137,044
Available-for-sale securities, at fair value	2,270,059			2,186,154			2,185,782			2,126,081			2,164,985
Held-to-maturity securities, at amortized cost	1,095,802			1,191,634			1,051,542			1,067,439			966,438
Trading account securities	3,204			2,430			559			1,692			688
Equity securities with readily determinable fair value	46,086			44,319			47,653			34,717			36,414
Federal Home Loan Bank and Federal Reserve Bank stock	92,714			92,026			89,013			91,354			99,998
Brokerage customer receivables	14,943			13,569			14,219			12,609			15,649
Mortgage loans held-for-sale	464,727			394,975			248,557			264,070			338,111
Loans, net of unearned income	25,710,171			25,304,659			24,214,629			23,820,691			23,123,951
Allowance for loan losses	(161,763		)	(160,421		)	(158,212		)	(152,770		)	(149,756		)
Net loans	25,548,408			25,144,238			24,056,417			23,667,921			22,974,195
Premises and equipment, net	721,856			711,214			676,037			671,169			664,469
Lease investments, net	228,647			230,111			224,240			233,208			199,241
Accrued interest receivable and other assets	1,087,864			1,023,896			888,492			696,707			700,568
Trade date securities receivable	—			237,607			375,211			263,523			—
Goodwill	584,315			584,911			573,658			573,141			537,560
Other intangible assets	43,657			46,588			46,566			49,424			27,378
Total assets	$	34,911,902		$	33,641,769		$	32,358,621		$	31,244,849		$	30,142,731
Liabilities and Shareholders’ Equity
Deposits:
Non-interest bearing	$	7,067,960		$	6,719,958		$	6,353,456		$	6,569,880		$	6,399,213
Interest bearing	21,642,419			20,798,857			20,451,286			19,524,798			18,517,502
Total deposits	28,710,379			27,518,815			26,804,742			26,094,678			24,916,715
Federal Home Loan Bank advances	574,847			574,823			576,353			426,326			615,000
Other borrowings	410,488			418,057			372,194			393,855			373,571
Subordinated notes	435,979			436,021			139,235			139,210			139,172
Junior subordinated debentures	253,566			253,566			253,566			253,566			253,566
Trade date securities payable	226			—			—			—			—
Accrued interest payable and other liabilities	986,092			993,537			840,559			669,644			664,885
Total liabilities	31,371,577			30,194,819			28,986,649			27,977,279			26,962,909
Shareholders’ Equity:
Preferred stock	125,000			125,000			125,000			125,000			125,000
Common stock	56,825			56,794			56,765			56,518			56,486
Surplus	1,574,011			1,569,969			1,565,185			1,557,984			1,553,353
Treasury stock	(6,799		)	(6,650		)	(6,650		)	(5,634		)	(5,547		)
Retained earnings	1,830,165			1,747,266			1,682,016			1,610,574			1,543,680
Accumulated other comprehensive loss	(38,877		)	(45,429		)	(50,344		)	(76,872		)	(93,150		)
Total shareholders’ equity	3,540,325			3,446,950			3,371,972			3,267,570			3,179,822
Total liabilities and shareholders’ equity	$	34,911,902		$	33,641,769		$	32,358,621		$	31,244,849		$	30,142,731

WINTRUST FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

	Three Months Ended														Nine Months Ended
(In thousands, except per share data)	Sep 30, 2019		Jun 30, 2019			Mar 31, 2019			Dec 31, 2018			Sep 30, 2018			Sep 30, 2019			Sep 30, 2018
Interest income
Interest and fees on loans	$	314,277	$	309,161		$	296,987		$	283,311		$	271,134		$	920,425		$	761,191
Mortgage loans held-for-sale	3,478		3,104			2,209			3,409			5,285			8,791			12,329
Interest bearing deposits with banks	10,326		5,206			5,300			5,628			5,423			20,832			11,462
Federal funds sold and securities purchased under resale agreements	310		—			—			—			—			310			1
Investment securities	24,758		27,721			27,956			26,656			21,710			80,435			60,726
Trading account securities	20		5			8			14			11			33			29
Federal Home Loan Bank and Federal Reserve Bank stock	1,294		1,439			1,355			1,343			1,235			4,088			3,988
Brokerage customer receivables	164		178			155			235			164			497			488
Total interest income	354,627		346,814			333,970			320,596			304,962			1,035,411			850,214
Interest expense
Interest on deposits	76,168		67,024			60,976			55,975			48,736			204,168			110,578
Interest on Federal Home Loan Bank advances	1,774		4,193			2,450			2,563			1,947			8,417			9,849
Interest on other borrowings	3,466		3,525			3,633			3,199			2,003			10,624			5,400
Interest on subordinated notes	5,470		2,806			1,775			1,788			1,773			10,051			5,333
Interest on junior subordinated debentures	2,897		3,064			3,150			2,983			2,940			9,111			8,239
Total interest expense	89,775		80,612			71,984			66,508			57,399			242,371			139,399
Net interest income	264,852		266,202			261,986			254,088			247,563			793,040			710,815
Provision for credit losses	10,834		24,580			10,624			10,401			11,042			46,038			24,431
Net interest income after provision for credit losses	254,018		241,622			251,362			243,687			236,521			747,002			686,384
Non-interest income
Wealth management	23,999		24,139			23,977			22,726			22,634			72,115			68,237
Mortgage banking	50,864		37,411			18,158			24,182			42,014			106,433			112,808
Service charges on deposit accounts	9,972		9,277			8,848			9,065			9,331			28,097			27,339
Gains (losses) on investment securities, net	710		864			1,364			(2,649		)	90			2,938			(249		)
Fees from covered call options	—		643			1,784			626			627			2,427			2,893
Trading gains (losses), net	11		(44		)	(171		)	(155		)	(61		)	(204		)	166
Operating lease income, net	12,025		11,733			10,796			10,882			9,132			34,554			27,569
Other	17,556		14,135			16,901			10,631			16,163			48,592			42,079
Total non-interest income	115,137		98,158			81,657			75,308			99,930			294,952			280,842
Non-interest expense
Salaries and employee benefits	141,024		133,732			125,723			122,111			123,855			400,479			357,966
Equipment	13,314		12,759			11,770			11,523			10,827			37,843			31,426
Operating lease equipment depreciation	8,907		8,768			8,319			8,462			7,370			25,994			20,843
Occupancy, net	14,991		15,921			16,245			15,980			14,404			47,157			41,834
Data processing	6,522		6,204			7,525			8,447			9,335			20,251			26,580
Advertising and marketing	13,375		12,845			9,858			9,414			11,120			36,078			31,726
Professional fees	8,037		6,228			5,556			9,259			9,914			19,821			23,047
Amortization of other intangible assets	2,928		2,957			2,942			1,407			1,163			8,827			3,164
FDIC insurance	148		4,127			3,576			4,044			4,205			7,851			13,165
OREO expense, net	1,170		1,290			632			1,618			596			3,092			4,502
Other	24,138		24,776			22,228			19,068			20,848			71,142			60,502
Total non-interest expense	234,554		229,607			214,374			211,333			213,637			678,535			614,755
Income before taxes	134,601		110,173			118,645			107,662			122,814			363,419			352,471
Income tax expense	35,480		28,707			29,499			28,005			30,866			93,686			88,962
Net income	$	99,121	$	81,466		$	89,146		$	79,657		$	91,948		$	269,733		$	263,509
Preferred stock dividends	2,050		2,050			2,050			2,050			2,050			6,150			6,150
Net income applicable to common shares	$	97,071	$	79,416		$	87,096		$	77,607		$	89,898		$	263,583		$	257,359
Net income per common share – Basic	$	1.71	$	1.40		$	1.54		$	1.38		$	1.59		$	4.65		$	4.57
Net income per common share – Diluted	$	1.69	$	1.38		$	1.52		$	1.35		$	1.57		$	4.60		$	4.50
Cash dividends declared per common share	$	0.25	$	0.25		$	0.25		$	0.19		$	0.19		$	0.75		$	0.57
Weighted average common shares outstanding	56,690		56,662			56,529			56,395			56,366			56,627			56,268
Dilutive potential common shares	773		699			699			892			918			724			912
Average common shares and dilutive common shares	57,463		57,361			57,228			57,287			57,284			57,351			57,180

TABLE 1: LOAN PORTFOLIO MIX AND GROWTH RATES

																% Growth From
(Dollars in thousands)	Sep 30, 2019			Jun 30, 2019			Mar 31, 2019			Dec 31, 2018			Sep 30, 2018			Dec 31, 2018⁽¹⁾		Sep 30, 2018
Balance:
Commercial	$	8,195,602		$	8,270,774		$	7,994,191		$	7,828,538		$	7,473,958		6	%	10	%
Commercial real estate	7,448,667			7,276,244			6,973,505			6,933,252			6,746,774			10		10
Home equity	512,303			527,370			528,448			552,343			578,844			(10	)	(11	)
Residential real estate	1,218,666			1,118,178			1,053,524			1,002,464			924,250			29		32
Premium finance receivables – commercial	3,449,950			3,368,423			2,988,788			2,841,659			2,885,327			29		20
Premium finance receivables – life insurance	4,795,496			4,634,478			4,555,369			4,541,794			4,398,971			7		9
Consumer and other	89,487			109,192			120,804			120,641			115,827			(35	)	(23	)
Total loans, net of unearned income	$	25,710,171		$	25,304,659		$	24,214,629		$	23,820,691		$	23,123,951		11	%	11	%
Mix:
Commercial	32		%	33		%	33		%	33		%	32		%
Commercial real estate	29			29			29			29			29
Home equity	2			2			2			2			3
Residential real estate	5			4			4			4			4
Premium finance receivables – commercial	13			13			12			12			12
Premium finance receivables – life insurance	19			18			19			19			19
Consumer and other	0			1			1			1			1
Total loans, net of unearned income	100		%	100		%	100		%	100		%	100		%

Annualized.

TABLE 2: COMMERCIAL AND COMMERCIAL REAL ESTATE LOAN PORTFOLIOS

	As of September 30, 2019
(Dollars in thousands)	Balance		% of Total Balance		Nonaccrual		> 90 Days Past Due and Still Accruing		Allowance For Loan Losses Allocation
Commercial:
Commercial, industrial and other	$	5,150,567	32.9	%	$	34,397	$	—	$	51,463
Franchise	914,774		5.9		3,752		—		8,308
Mortgage warehouse lines of credit	314,697		2.0		—		—		2,481
Asset-based lending	1,045,869		6.7		5,782		—		8,445
Leases	754,163		4.8		—		—		2,069
PCI – commercial loans ⁽¹⁾	15,532		0.1		—		382		361
Total commercial	$	8,195,602	52.4	%	$	43,931	$	382	$	73,127
Commercial Real Estate:
Construction	$	850,575	5.4	%	$	1,030	$	—	$	9,405
Land	175,386		1.1		994		—		4,801
Office	996,931		6.4		8,158		—		10,066
Industrial	1,009,680		6.5		100		—		7,021
Retail	1,004,720		6.4		7,174		—		6,718
Multi-family	1,291,825		8.3		690		—		12,504
Mixed use and other	2,002,267		12.8		3,411		—		14,370
PCI – commercial real estate⁽¹⁾	117,283		0.7		—		4,992		53
Total commercial real estate	$	7,448,667	47.6	%	$	21,557	$	4,992	$	64,938
Total commercial and commercial real estate	$	15,644,269	100.0	%	$	65,488	$	5,374	$	138,065

Commercial real estate – collateral location by state:
Illinois	$	5,654,827	75.9	%
Wisconsin	744,577		10.0
Total primary markets	$	6,399,404	85.9	%
Indiana	193,350		2.6
Florida	80,120		1.1
Arizona	62,657		0.8
California	67,999		0.9
Other	645,137		8.7
Total commercial real estate	$	7,448,667	100.0	%

Purchased credit impaired (“PCI”) loans represent loans acquired with evidence of credit quality deterioration since origination, in accordance with ASC 310-30. Loan agings are based upon contractually required payments.

TABLE 3: DEPOSIT PORTFOLIO MIX AND GROWTH RATES

																% Growth From
(Dollars in thousands)	Sep 30, 2019			Jun 30, 2019			Mar 31, 2019			Dec 31, 2018			Sep 30, 2018			Dec 31, 2018⁽¹⁾		Sep 30, 2018
Balance:
Non-interest bearing	$	7,067,960		$	6,719,958		$	6,353,456		$	6,569,880		$	6,399,213		10	%	10	%
NOW and interest bearing demand deposits	2,966,098			2,788,976			2,948,576			2,897,133			2,512,259			3		18
Wealth management deposits ⁽²⁾	2,795,838			3,220,256			3,328,781			2,996,764			2,520,120			(9	)	11
Money market	7,326,899			6,460,098			6,093,596			5,704,866			5,429,921			38		35
Savings	2,934,348			2,823,904			2,729,626			2,665,194			2,595,164			14		13
Time certificates of deposit	5,619,236			5,505,623			5,350,707			5,260,841			5,460,038			9		3
Total deposits	$	28,710,379		$	27,518,815		$	26,804,742		$	26,094,678		$	24,916,715		13	%	15	%
Mix:
Non-interest bearing	25		%	24		%	24		%	25		%	26		%
NOW and interest bearing demand deposits	10			10			11			11			10
Wealth management deposits ⁽²⁾	10			12			12			12			10
Money market	25			24			23			22			22
Savings	10			10			10			10			10
Time certificates of deposit	20			20			20			20			22
Total deposits	100		%	100		%	100		%	100		%	100		%

Annualized.
Represents deposit balances of the Company’s subsidiary banks from brokerage customers of Wintrust Investments, CDEC, trust and asset management customers of the Company and brokerage customers from unaffiliated companies which have been placed into deposit accounts.

TABLE 4: TIME CERTIFICATES OF DEPOSIT MATURITY/RE-PRICING ANALYSIS
As of September 30, 2019

(Dollars in thousands)	CDARs & Brokered Certificates of Deposit ⁽¹⁾		MaxSafe Certificates of Deposit ⁽¹⁾		Variable Rate Certificates of Deposit ⁽²⁾		Other Fixed Rate Certificates of Deposit ⁽¹⁾		Total Time Certificates of Deposit		Weighted-Average Rate of Maturing Time Certificates of Deposit ⁽³⁾
1-3 months	$	—	$	32,568	$	91,118	$	701,268	$	824,954	1.66	%
4-6 months	—		27,147		—		845,167		872,314		2.01
7-9 months	—		11,048		—		1,155,153		1,166,201		2.18
10-12 months	—		18,177		—		529,793		547,970		1.92
13-18 months	—		15,977		—		733,072		749,049		2.36
19-24 months	1,000		9,714		—		1,128,392		1,139,106		2.62
24+ months	—		5,042		—		314,600		319,642		2.30
Total	$	1,000	$	119,673	$	91,118	$	5,407,445	$	5,619,236	2.17	%

This category of certificates of deposit is shown by contractual maturity date.
This category includes variable rate certificates of deposit and savings certificates with the majority repricing on at least a monthly basis.
Weighted-average rate excludes the impact of purchase accounting fair value adjustments.

TABLE 5: QUARTERLY AVERAGE BALANCES

	Average Balance for three months ended,
	Sep 30,			Jun 30,			Mar 31,			Dec 31,			Sep 30,
	2019			2019			2019			2018			2018
(In thousands)	$	1,960,898		$	893,332		$	897,629		$	1,042,860		$	998,004
Interest-bearing deposits with banks and cash equivalents ⁽¹⁾
Investment securities ⁽²⁾	3,410,090			3,653,580			3,630,577			3,347,496			3,046,272
FHLB and FRB stock	92,583			105,491			94,882			98,084			88,335
Liquidity management assets ⁽⁶⁾	5,463,571			4,652,403			4,623,088			4,488,440			4,132,611
Other earning assets ⁽³⁾⁽⁶⁾	17,809			15,719			13,591			16,204			17,862
Mortgage loans held-for-sale	379,870			281,732			188,190			265,717			380,235
Loans, net of unearned income ⁽⁴⁾⁽⁶⁾	25,346,290			24,553,263			23,880,916			23,164,154			22,823,378
Total earning assets ⁽⁶⁾	31,207,540			29,503,117			28,705,785			27,934,515			27,354,086
Allowance for loan losses	(168,423		)	(164,231		)	(157,782		)	(154,438		)	(148,503		)
Cash and due from banks	297,475			273,679			283,019			271,403			268,006
Other assets	2,618,000			2,443,204			2,385,149			2,128,407			2,051,520
Total assets	$	33,954,592		$	32,055,769		$	31,216,171		$	30,179,887		$	29,525,109

NOW and interest bearing demand deposits	$	2,912,961		$	2,878,021		$	2,803,338		$	2,671,283		$	2,519,445
Wealth management deposits	2,888,817			2,605,690			2,614,035			2,289,904			2,517,141
Money market accounts	6,956,755			6,095,285			5,915,525			5,632,268			5,369,324
Savings accounts	2,837,039			2,752,828			2,715,422			2,553,133			2,672,077
Time deposits	5,590,228			5,322,384			5,267,796			5,381,029			5,214,637
Interest-bearing deposits	21,185,800			19,654,208			19,316,116			18,527,617			18,292,624
Federal Home Loan Bank advances	574,833			869,812			594,335			551,846			429,739
Other borrowings	416,300			419,064			465,571			385,878			268,278
Subordinated notes	436,041			220,771			139,217			139,186			139,155
Junior subordinated debentures	253,566			253,566			253,566			253,566			253,566
Total interest-bearing liabilities	22,866,540			21,417,421			20,768,805			19,858,093			19,383,362
Non-interest bearing deposits	6,776,786			6,487,627			6,444,378			6,542,228			6,461,195
Other liabilities	814,552			736,381			693,910			578,912			548,609
Equity	3,496,714			3,414,340			3,309,078			3,200,654			3,131,943
Total liabilities and shareholders’ equity	$	33,954,592		$	32,055,769		$	31,216,171		$	30,179,887		$	29,525,109

Net free funds/contribution ⁽⁵⁾	$	8,341,000		$	8,085,696		$	7,936,980		$	8,076,422		$	7,970,724

Includes interest-bearing deposits from banks, federal funds sold and securities purchased under resale agreements.
Investment securities includes investment securities classified as available-for-sale and held-to-maturity, and equity securities with readily determinable fair values. Equity securities without readily determinable fair values are included within other assets.
Other earning assets include brokerage customer receivables and trading account securities.
Loans, net of unearned income, include non-accrual loans.
Net free funds are the difference between total average earning assets and total average interest-bearing liabilities. The estimated contribution to net interest margin from net free funds is calculated using the rate paid for total interest-bearing liabilities.
See “Supplemental Non-GAAP Financial Measures/Ratios” at Table 18 for additional information on this performance measure/ratio.

TABLE 6: QUARTERLY NET INTEREST INCOME

	Net Interest Income for three months ended,
	Sep 30,			Jun 30,			Mar 31,			Dec 31,			Sep 30,
(In thousands)	2019			2019			2019			2018			2018
Interest income:
Interest-bearing deposits with banks and cash equivalents	$	10,636		$	5,206		$	5,300		$	5,628		$	5,423
Investment securities	25,332			28,290			28,521			27,242			22,285
FHLB and FRB stock	1,294			1,439			1,355			1,343			1,235
Liquidity management assets (2)	37,262			34,935			35,176			34,213			28,943
Other earning assets (2)	189			184			165			253			178
Mortgage loans held-for-sale	3,478			3,104			2,209			3,409			5,285
Loans, net of unearned income (2)	315,255			310,191			298,021			284,291			272,075
Total interest income	$	356,184		$	348,414		$	335,571		$	322,166		$	306,481

Interest expense:
NOW and interest bearing demand deposits	$	5,291		$	5,553		$	4,613		$	4,007		$	2,479
Wealth management deposits	9,163			7,091			7,000			7,119			8,287
Money market accounts	25,426			21,451			19,460			16,936			13,260
Savings accounts	5,622			4,959			4,249			3,096			2,907
Time deposits	30,666			27,970			25,654			24,817			21,803
Interest-bearing deposits	76,168			67,024			60,976			55,975			48,736
Federal Home Loan Bank advances	1,774			4,193			2,450			2,563			1,947
Other borrowings	3,466			3,525			3,633			3,199			2,003
Subordinated notes	5,470			2,806			1,775			1,788			1,773
Junior subordinated debentures	2,897			3,064			3,150			2,983			2,940
Total interest expense	$	89,775		$	80,612		$	71,984		$	66,508		$	57,399

Less: Fully taxable-equivalent adjustment	(1,557		)	(1,600		)	(1,601		)	(1,570		)	(1,519		)
Net interest income (GAAP) (1)	264,852			266,202			261,986			254,088			247,563
Fully taxable-equivalent adjustment	1,557			1,600			1,601			1,570			1,519
Net interest income, fully taxable-equivalent (non-GAAP) (1)	$	266,409		$	267,802		$	263,587		$	255,658		$	249,082

See “Supplemental Non-GAAP Financial Measures/Ratios” at Table 18 for additional information on this performance measure/ratio.
Interest income on tax-advantaged loans, trading securities and investment securities reflects a taxable-equivalent adjustment based on the marginal federal corporate tax rate in effect as of the applicable period.

TABLE 7: QUARTERLY NET INTEREST MARGIN

	Net Interest Margin for three months ended,
	Sep 30, 2019		Jun 30, 2019		Mar 31, 2019		Dec 31, 2018		Sep 30, 2018
Yield earned on:
Interest-bearing deposits with banks and cash equivalents	2.15	%	2.34	%	2.39	%	2.14	%	2.16	%
Investment securities	2.95		3.11		3.19		3.23		2.90
FHLB and FRB stock	5.55		5.47		5.79		5.43		5.54
Liquidity management assets	2.71		3.01		3.09		3.02		2.78
Other earning assets	4.20		4.68		4.91		6.19		3.95
Mortgage loans held-for-sale	3.63		4.42		4.76		5.09		5.51
Loans, net of unearned income	4.93		5.07		5.06		4.87		4.73
Total earning assets	4.53	%	4.74	%	4.74	%	4.58	%	4.45	%

Rate paid on:
NOW and interest bearing demand deposits	0.72	%	0.77	%	0.67	%	0.60	%	0.39	%
Wealth management deposits	1.26		1.09		1.09		1.23		1.31
Money market accounts	1.45		1.41		1.33		1.19		0.98
Savings accounts	0.79		0.72		0.63		0.48		0.43
Time deposits	2.18		2.11		1.98		1.83		1.66
Interest-bearing deposits	1.43		1.37		1.29		1.20		1.06
Federal Home Loan Bank advances	1.22		1.93		1.67		1.84		1.80
Other borrowings	3.30		3.37		3.16		3.29		2.96
Subordinated notes	5.02		5.08		5.10		5.14		5.10
Junior subordinated debentures	4.47		4.78		4.97		4.60		4.54
Total interest-bearing liabilities	1.56	%	1.51	%	1.40	%	1.33	%	1.17	%

Interest rate spread⁽¹⁾⁽³⁾	2.97	%	3.23	%	3.34	%	3.25	%	3.28	%
Less: Fully taxable-equivalent adjustment	(0.02	)	(0.02	)	(0.02	)	(0.02	)	(0.02	)
Net free funds/contribution⁽²⁾	0.42		0.41		0.38		0.38		0.33
Net interest margin (GAAP)⁽³⁾	3.37	%	3.62	%	3.70	%	3.61	%	3.59	%
Fully taxable-equivalent adjustment	0.02		0.02		0.02		0.02		0.02
Net interest margin, fully taxable-equivalent (non-GAAP)⁽³⁾	3.39	%	3.64	%	3.72	%	3.63	%	3.61	%

Interest rate spread is the difference between the yield earned on earning assets and the rate paid on interest-bearing liabilities.
Net free funds are the difference between total average earning assets and total average interest-bearing liabilities. The estimated contribution to net interest margin from net free funds is calculated using the rate paid for total interest-bearing liabilities.
See “Supplemental Non-GAAP Financial Measures/Ratios” at Table 18 for additional information on this performance measure/ratio.

TABLE 8: YEAR-TO-DATE AVERAGE BALANCES, AND NET INTEREST INCOME AND MARGIN

	Average Balance for nine months ended,						Interest for nine months ended,						Yield/Rate for nine months ended,
(Dollars in thousands)	Sep 30, 2019			Sep 30, 2018			Sep 30, 2019			Sep 30, 2018			Sep 30, 2019		Sep 30, 2018
Interest-bearing deposits with banks and cash equivalents ⁽¹⁾	$	1,254,534		$	836,710		$	21,142		$	11,463		2.26	%	1.83	%
Investment securities ⁽²⁾	3,563,941			2,943,802			82,142			62,398			3.08		2.83
FHLB and FRB stock	97,624			102,893			4,088			3,988			5.60		5.18
Liquidity management assets ⁽³⁾⁽⁸⁾	$	4,916,099		$	3,883,405		$	107,372		$	77,849		2.92	%	2.68	%
Other earning assets ^(3)(4)(8)	15,722			22,190			538			524			4.56		3.15
Mortgage loans held-for-sale	283,966			355,491			8,791			12,329			4.14		4.64
Loans, net of unearned income ^(3)(5)(8)	24,598,857			22,276,827			923,468			763,614			5.02		4.58
Total earning assets ⁽⁸⁾	$	29,814,644		$	26,537,913		$	1,040,169		$	854,316		4.66	%	4.30	%
Allowance for loan losses	(163,518		)	(146,287		)
Cash and due from banks	284,779			264,294
Other assets	2,482,970			1,984,460
Total assets	$	32,418,875		$	28,640,380

NOW and interest bearing demand deposits	$	2,865,175		$	2,357,768		$	15,457		$	5,765		0.72	%	0.33	%
Wealth management deposits	2,703,853			2,378,468			23,254			20,721			1.15		1.16
Money market accounts	6,326,336			4,927,639			66,337			26,038			1.40		0.71
Savings accounts	2,768,875			2,728,986			14,830			8,348			0.72		0.41
Time deposits	5,394,651			4,701,247			84,290			49,706			2.09		1.41
Interest-bearing deposits	$	20,058,890		$	17,094,108		$	204,168		$	110,578		1.36	%	0.86	%
Federal Home Loan Bank advances	679,589			768,029			8,417			9,849			1.66		1.71
Other borrowings	433,465			257,175			10,624			5,400			3.28		2.81
Subordinated notes	266,430			139,125			10,051			5,333			5.03		5.11
Junior subordinated debentures	253,566			253,566			9,111			8,239			4.74		4.28
Total interest-bearing liabilities	$	21,691,940		$	18,512,003		$	242,371		$	139,399		1.49	%	1.01	%
Non-interest bearing deposits	6,570,815			6,546,269
Other liabilities	748,722			517,712
Equity	3,407,398			3,064,396
Total liabilities and shareholders’ equity	$	32,418,875		$	28,640,380
Interest rate spread ⁽⁶⁾⁽⁸⁾													3.17	%	3.29	%
Less: Fully taxable-equivalent adjustment							(4,758		)	(4,102		)	(0.02	)	(0.02	)
Net free funds/contribution ⁽⁷⁾	$	8,122,704		$	8,025,910								0.41		0.31
Net interest income/ margin (GAAP)⁽⁸⁾							$	793,040		$	710,815		3.56	%	3.58	%
Fully taxable-equivalent adjustment							4,758			4,102			0.02		0.02
Net interest income/ margin, fully taxable-equivalent (non-GAAP) ⁽⁸⁾							$	797,798		$	714,917		3.58	%	3.60	%

Includes interest-bearing deposits from banks, federal funds sold and securities purchased under resale agreements.
Investment securities includes investment securities classified as available-for-sale and held-to-maturity, and equity securities with readily determinable fair values. Equity securities without readily determinable fair values are included within other assets.
Interest income on tax-advantaged loans, trading securities and investment securities reflects a taxable-equivalent adjustment based on a marginal federal corporate tax rate in effect as of the applicable period.
Other earning assets include brokerage customer receivables and trading account securities.
Loans, net of unearned income, include non-accrual loans.
Interest rate spread is the difference between the yield earned on earning assets and the rate paid on interest-bearing liabilities.
Net free funds are the difference between total average earning assets and total average interest-bearing liabilities. The estimated contribution to net interest margin from net free funds is calculated using the rate paid for total interest-bearing liabilities.
See “Supplemental Non-GAAP Financial Measures/Ratios” at Table 18 for additional information on this performance ratio.

TABLE 9: INTEREST RATE SENSITIVITY

As an ongoing part of its financial strategy, the Company attempts to manage the impact of fluctuations in market interest rates on net interest income. Management measures its exposure to changes in interest rates by modeling many different interest rate scenarios.

The following interest rate scenarios display the percentage change in net interest income over a one-year time horizon assuming increases of 100 and 200 basis points and a decrease of 100 basis points. The Static Shock Scenario results incorporate actual cash flows and repricing characteristics for balance sheet instruments following an instantaneous, parallel change in market rates based upon a static (i.e. no growth or constant) balance sheet. Conversely, the Ramp Scenario results incorporate management’s projections of future volume and pricing of each of the product lines following a gradual, parallel change in market rates over twelve months. Actual results may differ from these simulated results due to timing, magnitude, and frequency of interest rate changes as well as changes in market conditions and management strategies. The interest rate sensitivity for both the Static Shock and Ramp Scenario is as follows:

Static Shock Scenario	+200 Basis Points		+100 Basis Points		-100 Basis Points
Sep 30, 2019	20.7	%	10.5	%	(11.9	)%
Jun 30, 2019	17.3		8.9		(10.2	)
Mar 31, 2019	14.9		7.8		(8.5	)
Dec 31, 2018	15.6		7.9		(8.6	)
Sep 30, 2018	18.1		9.1		(10.0	)

Ramp Scenario	+200 Basis Points		+100 Basis Points		-100 Basis Points
Sep 30, 2019	10.1	%	5.2	%	(5.6	)%
Jun 30, 2019	8.3		4.3		(4.6	)
Mar 31, 2019	6.7		3.5		(3.3	)
Dec 31, 2018	7.4		3.8		(3.6	)
Sep 30, 2018	8.5		4.3		(4.2	)

TABLE 10: MATURITIES AND SENSITIVITIES TO CHANGES IN INTEREST RATES

Loans repricing or maturity period

As of September 30, 2019

From one to

(In thousands)

One year or less

five years

Over five years

Total

Commercial

Fixed rate

206,052

1,213,099

822,338

2,241,489

Variable rate

5,947,908

6,067

138

5,954,113

Total commercial

6,153,960

1,219,166

822,476

8,195,602

Commercial real estate

Fixed rate

463,155

2,043,088

341,511

2,847,754

Variable rate

4,573,350

27,555

4,600,913

Total commercial real estate

5,036,505

2,070,643

341,519

7,448,667

Home equity

Fixed rate

23,952

5,642

19,614

49,208

Variable rate

462,790

305

—

463,095

Total home equity

486,742

5,947

19,614

512,303

Residential real estate

Fixed rate

28,980

19,581

302,634

351,195

Variable rate

57,238

345,029

465,204

867,471

Total residential real estate

86,218

364,610

767,838

1,218,666

Premium finance receivables – commercial

Fixed rate

3,365,631

84,319

—

3,449,950

Variable rate

—

Total premium finance receivables – commercial

3,365,631

84,319

—

3,449,950

Premium finance receivables – life insurance

Fixed rate

12,242

121,600

26,667

160,509

Variable rate

4,634,987

—

4,634,987

Total premium finance receivables – life insurance

4,647,229

121,600

26,667

4,795,496

Consumer and other

Fixed rate

51,386

9,802

1,943

63,131

Variable rate

26,356

—

26,356

Total consumer and other

77,742

9,802

1,943

89,487

Total per category

Fixed rate

4,151,398

3,497,131

1,514,707

9,163,236

Variable rate

15,702,629

378,956

465,350

16,546,935

Total loans, net of unearned income

19,854,027

3,876,087

1,980,057

25,710,171

Variable Rate Loan Pricing by Index:

Prime

2,252,517

One- month LIBOR

8,439,173

Three- month LIBOR

400,567

Twelve- month LIBOR

5,222,025

Other

232,653

Total variable rate

16,546,935

http://ml.globenewswire.com/Resource/Download/20597901-9267-4190-859a-8e64a47f0076
Source: Bloomberg

As noted in the table on the previous page, the majority of the Company’s portfolio is tied to LIBOR indices which, as shown in the table above, do not mirror the same changes as the Prime rate when the Federal Reserve raises or lowers interest rates. Specifically, the Company has $8.4 billion of variable rate loans tied to one-month LIBOR and $5.2 billion of variable rate loans tied to twelve-month LIBOR. The above chart shows:

	Basis Points (bps) Change in
	Prime		1-month LIBOR		12-month LIBOR
Third Quarter 2019	-50	bps	-38	bps	-15	bps
Second Quarter 2019	+0		-9		-53
First Quarter 2019	+0		-1		-30
Fourth Quarter 2018	+25		+24		+9
Third Quarter 2018	+25		+17		+16

TABLE 11: ALLOWANCE FOR CREDIT LOSSES

	Three Months Ended															Nine Months Ended
	Sep 30,			Jun 30,			Mar 31,			Dec 31,			Sep 30,			Sep 30,			Sep 30,
(Dollars in thousands)	2019			2019			2019			2018			2018			2019			2018
Allowance for loan losses at beginning of period	$	160,421		$	158,212		$	152,770		$	149,756		$	143,402		$	152,770		$	137,905
Provision for credit losses	10,834			24,580			10,624			10,401			11,042			46,038			24,431
Other adjustments	(13		)	(11		)	(27		)	(79		)	(18		)	(51		)	(102		)
Reclassification (to) from allowance for unfunded lending-related commitments	(30		)	(70		)	(16		)	(150		)	(2		)	(116		)	24
Charge-offs:
Commercial	6,775			17,380			503			6,416			3,219			24,658			8,116
Commercial real estate	809			326			3,734			219			208			4,869			1,176
Home equity	1,594			690			88			715			561			2,372			1,530
Residential real estate	25			287			3			267			337			315			1,088
Premium finance receivables – commercial	1,866			5,009			2,210			1,741			2,512			9,085			10,487
Premium finance receivables – life insurance	—			—			—			—			—			—			—
Consumer and other	117			136			102			148			144			355			732
Total charge-offs	11,186			23,828			6,640			9,506			6,981			41,654			23,129
Recoveries:
Commercial	367			289			318			225			304			974			1,232
Commercial real estate	385			247			480			1,364			193			1,112			4,267
Home equity	183			68			62			105			142			313			436
Residential real estate	203			140			29			47			466			372			2,028
Premium finance receivables – commercial	563			734			556			567			1,142			1,853			2,502
Premium finance receivables – life insurance	—			—			—			—			—			—			—
Consumer and other	36			60			56			40			66			152			162
Total recoveries	1,737			1,538			1,501			2,348			2,313			4,776			10,627
Net charge-offs	(9,449		)	(22,290		)	(5,139		)	(7,158		)	(4,668		)	(36,878		)	(12,502		)
Allowance for loan losses at period end	$	161,763		$	160,421		$	158,212		$	152,770		$	149,756		$	161,763		$	149,756
Allowance for unfunded lending-related commitments at period end	1,510			1,480			1,410			1,394			1,245			1,510			1,245
Allowance for credit losses at period end	$	163,273		$	161,901		$	159,622		$	154,164		$	151,001		$	163,273		$	151,001

Annualized net charge-offs (recoveries) by category as a percentage of its own respective category’s average:
Commercial	0.31		%	0.85		%	0.01		%	0.33		%	0.16		%	0.39		%	0.13		%
Commercial real estate	0.02			0.00			0.19			(0.07		)	0.00			0.07			(0.06		)
Home equity	1.08			0.47			0.02			0.43			0.28			0.52			0.24
Residential real estate	(0.07		)	0.06			(0.01		)	0.10			(0.06		)	(0.01		)	(0.15		)
Premium finance receivables – commercial	0.15			0.55			0.23			0.16			0.19			0.31			0.39
Premium finance receivables – life insurance	—			—			—			—			—			—			—
Consumer and other	0.27			0.30			0.16			0.30			0.23			0.24			0.58
Total loans, net of unearned income	0.15		%	0.36		%	0.09		%	0.12		%	0.08		%	0.20		%	0.08		%

Net charge-offs as a percentage of the provision for credit losses	87.22		%	90.68		%	48.37		%	68.82		%	42.27		%	80.10		%	51.17		%
Loans at period-end	$	25,710,171		$	25,304,659		$	24,214,629		$	23,820,691		$	23,123,951
Allowance for loan losses as a percentage of loans at period end	0.63		%	0.63		%	0.65		%	0.64		%	0.65		%
Allowance for credit losses as a percentage of loans at period end	0.64			0.64			0.66			0.65			0.65

Provision for credit losses by component for the periods presented:

	Three Months Ended															Nine Months Ended
	Sep 30,			Jun 30,			Mar 31,			Dec 31,			Sep 30,			Sep 30,			Sep 30,
(Dollars in thousands)	2019			2019			2019			2018			2018			2019			2018
Provision for loan losses	$	10,804		$	24,510		$	10,608		$	10,251		$	11,040		$	45,922		$	24,455
Provision for unfunded lending-related commitments	30			70			16			150			2			116			(24			)
Provision for credit losses	$		10,834	$		24,580	$		10,624	$		10,401	$		11,042	$		46,038	$		24,431

TABLE 12: ALLOWANCE BY LOAN PORTFOLIO

The table below summarizes the calculation of allowance for loan losses for the Company’s core loan portfolio and consumer, niche and purchased loan portfolio, as of September 30, 2019 and June 30, 2019.

	As of September 30, 2019						As of June 30, 2019
(Dollars in thousands)	Recorded Investment		Calculated Allowance		% of its category’s balance		Recorded Investment		Calculated Allowance		% of its category’s balance
Commercial: ⁽¹⁾
Commercial and industrial	$	4,368,580	$	47,983	1.10	%	$	4,529,952	$	49,451	1.09	%
Asset-based lending	1,043,384		8,445		0.81		1,066,231		9,335		0.88
Tax exempt	503,495		2,957		0.59		489,524		2,808		0.57
Leases	749,135		2,069		0.28		674,251		1,879		0.28
Commercial real estate: ⁽¹⁾
Residential construction	35,662		625		1.75		39,633		797		2.01
Commercial construction	810,919		8,757		1.08		792,782		8,523		1.08
Land	168,092		4,801		2.86		138,255		4,193		3.03
Office	964,557		10,066		1.04		925,150		9,778		1.06
Industrial	972,859		7,015		0.72		921,116		6,589		0.72
Retail	960,762		6,718		0.70		930,594		6,515		0.70
Multi-family	1,239,217		12,504		1.01		1,184,025		11,983		1.01
Mixed use and other	1,918,510		14,362		0.75		1,944,182		14,800		0.76
Home equity ⁽¹⁾	479,627		3,702		0.77		489,813		3,595		0.73
Residential real estate ⁽¹⁾	1,191,153		9,314		0.78		1,089,496		8,042		0.74
Total core loan portfolio	$	15,405,952	$	139,318	0.90	%	$	15,215,004	$	138,288	0.91	%
Commercial:
Franchise	$	881,287	$	8,251	0.94	%	$	891,481	$	8,255	0.93	%
Mortgage warehouse lines of credit	314,697		2,481		0.79		275,170		2,195		0.80
Community Advantage – homeowner associations	202,724		507		0.25		192,056		481		0.25
Aircraft	11,112		9		0.08		11,305		9		0.08
Purchased commercial loans ⁽²⁾	121,188		425		0.35		140,804		480		0.34
Purchased commercial real estate ⁽²⁾	378,089		90		0.02		400,507		92		0.02
Purchased home equity ⁽²⁾	32,676		18		0.06		37,557		36		0.10
Purchased residential real estate ⁽²⁾	27,513		97		0.35		28,682		104		0.36
Premium finance receivables
U.S. commercial insurance loans	3,016,644		7,207		0.24		2,914,625		6,789		0.23
Canada commercial insurance loans ⁽²⁾	433,306		648		0.15		453,798		725		0.16
Life insurance loans ⁽¹⁾	4,552,555		1,511		0.03		4,487,921		1,426		0.03
Purchased life insurance loans ⁽²⁾	242,941		—		—		146,557		—		—
Consumer and other ⁽¹⁾	86,437		1,199		1.40		105,966		1,538		1.45
Purchased consumer and other ⁽²⁾	3,050		2		0.07		3,226		3		0.09
Total consumer, niche and purchased loan portfolio	$	10,304,219	$	22,445	0.22	%	$	10,089,655	$	22,133	0.22	%
Total loans, net of unearned income	$	25,710,171	$	161,763	0.63	%	$	25,304,659	$	160,421	0.63	%

Excludes purchased loans reported in accordance with ASC 310-20 and ASC 310-30.
Purchased loans represent loans reported in accordance with ASC 310-20 and ASC 310-30.

TABLE 13: LOAN PORTFOLIO AGING

90+ days

60-89

30-59

As of September 30, 2019

and still

days past

(Dollars in thousands)

Nonaccrual

accruing

due

Current

Total Loans

Loan Balances:

Commercial ⁽¹⁾

43,931

382

12,860

51,487

8,086,942

8,195,602

Commercial real estate ⁽¹⁾

21,557

4,992

9,629

33,098

7,379,391

7,448,667

Home equity

7,920

—

3,100

501,188

512,303

Residential real estate ⁽¹⁾

13,447

3,244

1,868

1,433

1,198,674

1,218,666

Premium finance receivables – commercial

15,950

10,612

8,853

16,972

3,397,563

3,449,950

Premium finance receivables – life insurance ⁽¹⁾

590

—

17,753

27,795

4,749,358

4,795,496

Consumer and other ⁽¹⁾

224

117

272

88,819

89,487

Total loans, net of unearned income

103,619

19,347

51,113

134,157

25,401,935

25,710,171

Aging as a % of Loan Balance:

Commercial ⁽¹⁾

0.5

0.0

0.2

0.6

98.7

100.0

Commercial real estate ⁽¹⁾

0.3

0.1

0.4

99.1

100.0

Home equity

1.6

—

0.0

0.6

97.8

100.0

Residential real estate ⁽¹⁾

1.1

0.3

0.1

98.4

100.0

Premium finance receivables – commercial

0.5

0.3

0.2

0.5

98.5

100.0

Premium finance receivables – life insurance ⁽¹⁾

0.0

—

0.4

0.6

99.0

100.0

Consumer and other ⁽¹⁾

0.2

0.1

0.3

99.3

100.0

Total loans, net of unearned income

0.4

0.1

0.2

0.5

98.8

100.0

Including PCI loans. PCI loans represent loans acquired with evidence of credit quality deterioration since origination, in accordance with ASC 310-30. Loan agings are based upon contractually required payments.

				90+ days			60-89			30-59
As of June 30, 2019				and still			days past			days past
(Dollars in thousands)	Nonaccrual			accruing			due			due			Current			Total Loans
Loan Balances:
Commercial ⁽¹⁾	$	47,604		$	1,939		$	5,283		$	16,102		$	8,199,846		$	8,270,774
Commercial real estate ⁽¹⁾	20,875			5,124			11,199			72,987			7,166,059			7,276,244
Home equity	8,489			—			321			2,155			516,405			527,370
Residential real estate ⁽¹⁾	14,236			1,867			1,306			1,832			1,098,937			1,118,178
Premium finance receivables – commercial	13,833			6,940			17,977			16,138			3,313,535			3,368,423
Premium finance receivables – life insurance ⁽¹⁾	590			—			18,580			19,673			4,595,635			4,634,478
Consumer and other ⁽¹⁾	220			235			242			227			108,268			109,192
Total loans, net of unearned income	$	105,847		$	16,105		$	54,908		$	129,114		$	24,998,685		$	25,304,659
Aging as a % of Loan Balance:
Commercial ⁽¹⁾	0.6		%	0.0		%	0.1		%	0.2		%	99.1		%	100.0		%
Commercial real estate ⁽¹⁾	0.3			0.1			0.2			1.0			98.4			100.0
Home equity	1.6			—			0.1			0.4			97.9			100.0
Residential real estate ⁽¹⁾	1.3			0.2			0.1			0.2			98.2			100.0
Premium finance receivables – commercial	0.4			0.2			0.5			0.5			98.4			100.0
Premium finance receivables – life insurance ⁽¹⁾	0.0			—			0.4			0.4			99.2			100.0
Consumer and other ⁽¹⁾	0.2			0.2			0.2			0.2			99.2			100.0
Total loans, net of unearned income	0.4		%	0.1		%	0.2		%	0.5		%	98.8		%	100.0		%

Including PCI loans. PCI loans represent loans acquired with evidence of credit quality deterioration since origination, in accordance with ASC 310-30. Loan agings are based upon contractually required payments.

TABLE 14: NON-PERFORMING ASSETS, EXCLUDING PCI LOANS, AND TROUBLED DEBT RESTRUCTURINGS (“TDRs”)

	Sep 30,			Jun 30,			Mar 31,			Dec 31,			Sep 30,
(Dollars in thousands)	2019			2019			2019			2018			2018
Loans past due greater than 90 days and still accruing (1):
Commercial	$	—		$	488		$	—		$	—		$	5,122
Commercial real estate	—			—			—			—			—
Home equity	—			—			—			—			—
Residential real estate	—			—			30			—			—
Premium finance receivables – commercial	10,612			6,940			6,558			7,799			7,028
Premium finance receivables – life insurance	—			—			168			—			—
Consumer and other	53			172			218			109			233
Total loans past due greater than 90 days and still accruing	10,665			7,600			6,974			7,908			12,383
Non-accrual loans (2):
Commercial	43,931			47,604			55,792			50,984			58,587
Commercial real estate	21,557			20,875			15,933			19,129			17,515
Home equity	7,920			8,489			7,885			7,147			8,523
Residential real estate	13,447			14,236			15,879			16,383			16,062
Premium finance receivables – commercial	15,950			13,833			14,797			11,335			13,802
Premium finance receivables – life insurance	590			590			—			—			—
Consumer and other	224			220			326			348			355
Total non-accrual loans	103,619			105,847			110,612			105,326			114,844
Total non-performing loans:
Commercial	43,931			48,092			55,792			50,984			63,709
Commercial real estate	21,557			20,875			15,933			19,129			17,515
Home equity	7,920			8,489			7,885			7,147			8,523
Residential real estate	13,447			14,236			15,909			16,383			16,062
Premium finance receivables – commercial	26,562			20,773			21,355			19,134			20,830
Premium finance receivables – life insurance	590			590			168			—			—
Consumer and other	277			392			544			457			588
Total non-performing loans	$	114,284		$	113,447		$	117,586		$	113,234		$	127,227
Other real estate owned	8,584			9,920			9,154			11,968			14,924
Other real estate owned – from acquisitions	8,898			9,917			12,366			12,852			13,379
Other repossessed assets	257			263			270			280			294
Total non-performing assets	$	132,023		$	133,547		$	139,376		$	138,334		$	155,824
TDRs performing under the contractual terms of the loan agreement	$	45,178		$	45,862		$	48,305		$	33,281		$	31,487
Total non-performing loans by category as a percent of its own respective category’s period-end balance:
Commercial	0.54		%	0.58		%	0.70		%	0.65		%	0.85		%
Commercial real estate	0.29			0.29			0.23			0.28			0.26
Home equity	1.55			1.61			1.49			1.29			1.47
Residential real estate	1.10			1.27			1.51			1.63			1.74
Premium finance receivables – commercial	0.77			0.62			0.71			0.67			0.72
Premium finance receivables – life insurance	0.01			0.01			0.00			—			—
Consumer and other	0.31			0.36			0.45			0.38			0.51
Total loans, net of unearned income	0.44		%	0.45		%	0.49		%	0.48		%	0.55		%
Total non-performing assets as a percentage of total assets	0.38		%	0.40		%	0.43		%	0.44		%	0.52		%
Allowance for loan losses as a percentage of total non-performing loans	141.54		%	141.41		%	134.55		%	134.92		%	117.71		%

Loans past due greater than 90 days and still accruing interest included TDRs totaling $5.1 million as of September 30, 2018. As of September 30, 2019, June 30, 2019, March 31, 2019 and December 31, 2018, no TDRs were past due greater than 90 days and still accruing interest.
Non-accrual loans included TDRs totaling $21.1 million, $30.1 million, $40.1 million, $32.8 million and $34.7 million as of September 30, 2019, June 30, 2019, March 31, 2019, December 31, 2018 and September 30, 2018, respectively.

Non-performing Loans Rollforward, excluding PCI loans:

	Three Months Ended															Nine Months Ended
	Sep 30,			Jun 30,			Mar 31,			Dec 31,			Sep 30,			Sep 30,			Sep 30,
(Dollars in thousands)	2019			2019			2019			2018			2018			2019			2018
Balance at beginning of period	$	113,447		$	117,586		$	113,234		$	127,227		$	83,282		$	113,234		$	90,162
Additions, net	20,781			20,567			24,030			18,553			56,864			65,378			73,875
Return to performing status	(407		)	(47		)	(14,077		)	(6,155		)	(3,782		)	(14,531		)	(8,294		)
Payments received	(16,326		)	(5,438		)	(4,024		)	(16,437		)	(6,212		)	(25,788		)	(13,370		)
Transfer to OREO and other repossessed assets	(1,493		)	(1,486		)	(82		)	(970		)	(659		)	(3,061		)	(6,168		)
Charge-offs	(6,984		)	(16,817		)	(3,992		)	(7,161		)	(3,108		)	(27,793		)	(8,631		)
Net change for niche loans (1)	5,266			(918		)	2,497			(1,823		)	842			6,845			(347		)
Balance at end of period	$	114,284		$	113,447		$	117,586		$	113,234		$	127,227		$	114,284		$	127,227

This includes activity for premium finance receivables and indirect consumer loans.

TDRs

	Sep 30,		Jun 30,		Mar 31,		Dec 31,		Sep 30,
(Dollars in thousands)	2019		2019		2019		2018		2018
Accruing TDRs:
Commercial	$	14,099	$	15,923	$	19,650	$	8,545	$	8,794
Commercial real estate	10,370		12,646		14,123		13,895		14,160
Residential real estate and other	20,709		17,293		14,532		10,841		8,533
Total accrual	$	45,178	$	45,862	$	48,305	$	33,281	$	31,487
Non-accrual TDRs: (1)
Commercial	$	7,451	$	21,850	$	34,390	$	27,774	$	30,452
Commercial real estate	7,673		2,854		1,517		1,552		1,326
Residential real estate and other	6,006		5,435		4,150		3,495		2,954
Total non-accrual	$	21,130	$	30,139	$	40,057	$	32,821	$	34,732
Total TDRs:
Commercial	$	21,550	$	37,773	$	54,040	$	36,319	$	39,246
Commercial real estate	18,043		15,500		15,640		15,447		15,486
Residential real estate and other	26,715		22,728		18,682		14,336		11,487
Total TDRs	$	66,308	$	76,001	$	88,362	$	66,102	$	66,219

Included in total non-performing loans.

Other Real Estate Owned

	Three Months Ended
	Sep 30,			Jun 30,			Mar 31,			Dec 31,			Sep 30,
(Dollars in thousands)	2019			2019			2019			2018			2018
Balance at beginning of period	$	19,837		$	21,520		$	24,820		$	28,303		$	35,331
Disposals/resolved	(4,501		)	(2,397		)	(2,758		)	(3,848		)	(7,291		)
Transfers in at fair value, less costs to sell	3,008			1,746			32			997			349
Additions from acquisition	—			—			—			160			1,418
Fair value adjustments	(862		)	(1,032		)	(574		)	(792		)	(1,504		)
Balance at end of period	$	17,482		$	19,837		$	21,520		$	24,820		$	28,303

	Period End
	Sep 30,			Jun 30,			Mar 31,			Dec 31,			Sep 30,
Balance by Property Type:	2019			2019			2019			2018			2018
Residential real estate	$	1,250		$	1,312		$	3,037		$	3,446		$	3,735
Residential real estate development	1,282			1,282			1,139			1,426			1,952
Commercial real estate	14,950			17,243			17,344			19,948			22,616
Total	$	17,482		$	19,837		$	21,520		$	24,820		$	28,303

TABLE 15: NON-INTEREST INCOME

	Three Months Ended															Q3 2019 compared to					Q3 2019 compared to
	Sep 30,			Jun 30,			Mar 31,			Dec 31,			Sep 30,			Q2 2019					Q3 2018
(Dollars in thousands)	2019			2019			2019			2018			2018			$ Change			% Change		$ Change			% Change
Brokerage	$	4,686		$	4,764		$	4,516		$	4,997		$	5,579		$	(78	)	(2	)%	$	(893	)	(16	)%
Trust and asset management	19,313			19,375			19,461			17,729			17,055			(62		)	—		2,258			13
Total wealth management	23,999			24,139			23,977			22,726			22,634			(140		)	(1	)	1,365			6
Mortgage banking	50,864			37,411			18,158			24,182			42,014			13,453			36		8,850			21
Service charges on deposit accounts	9,972			9,277			8,848			9,065			9,331			695			7		641			7
Gains (losses) on investment securities, net	710			864			1,364			(2,649		)	90			(154		)	(18	)	620			NM
Fees from covered call options	—			643			1,784			626			627			(643		)	(100	)	(627		)	(100	)
Trading gains (losses), net	11			(44		)	(171		)	(155		)	(61		)	55			(125	)	72			NM
Operating lease income, net	12,025			11,733			10,796			10,882			9,132			292			2		2,893			32
Other:
Interest rate swap fees	4,811			3,224			2,831			2,602			2,359			1,587			49		2,452			104
BOLI	830			1,149			1,591			(466		)	3,190			(319		)	(28	)	(2,360		)	NM
Administrative services	1,086			1,009			1,030			1,260			1,099			77			8		(13		)	(1	)
Foreign currency remeasurement (losses) gains	(55		)	113			464			(1,149		)	348			(168		)	(149	)	(403		)	NM
Early pay-offs of capital leases	6			—			5			3			11			6			NM		(5		)	(45	)
Miscellaneous	10,878			8,640			10,980			8,381			9,156			2,238			26		1,722			19
Total Other	17,556			14,135			16,901			10,631			16,163			3,421			24		1,393			9
Total Non-Interest Income	$	115,137		$	98,158		$	81,657		$	75,308		$	99,930		$	16,979		17	%	$	15,207		15	%

NM – Not meaningful.

	Nine Months Ended
	Sep 30,			Sep 30,			$			%
(Dollars in thousands)	2019			2018			Change			Change
Brokerage	$	13,966		$	17,394		$	(3,428	)	(20	)%
Trust and asset management	58,149			50,843			7,306			14
Total wealth management	72,115			68,237			3,878			6
Mortgage banking	106,433			112,808			(6,375		)	(6	)
Service charges on deposit accounts	28,097			27,339			758			3
Gains on investment securities, net	2,938			(249		)	3,187			NM
Fees from covered call options	2,427			2,893			(466		)	(16	)
Trading (losses) gains, net	(204		)	166			(370		)	NM
Operating lease income, net	34,554			27,569			6,985			25
Other:
Interest rate swap fees	10,866			8,425			2,441			29
BOLI	3,570			5,448			(1,878		)	(34	)
Administrative services	3,125			3,365			(240		)	(7	)
Foreign currency remeasurement gain (loss)	522			(524		)	1,046			NM
Early pay-offs of leases	11			598			(587		)	(98	)
Miscellaneous	30,498			24,767			5,731			23
Total Other	48,592			42,079			6,513			15
Total Non-Interest Income	$	294,952		$	280,842		$	14,110		5	%

NM – Not meaningful.

TABLE 16: MORTGAGE BANKING REVENUE

	Three Months Ended															Nine Months Ended
(Dollars in thousands)	Sep 30, 2019			Jun 30, 2019			Mar 31, 2019			Dec 31, 2019			Sep 30, 2018			Sep 30, 2019			Sep 30, 2018
Originations:
Retail originations	$	913,631		$	669,510		$	365,602		$	463,196		$	642,213		$	1,948,743		$	1,949,036
Correspondent originations	50,639			182,966			148,100			289,101			310,446			381,705			559,896
Veterans First originations	456,005			301,324			164,762			175,483			199,774			922,091			518,726
Total originations for sale (A)	$	1,420,275		$	1,153,800		$	678,464		$	927,780		$	1,152,433		$	3,252,539		$	3,027,658
Originations for investment	154,897			106,237			93,689			93,275			54,172			354,823			165,655
Total originations	$	1,575,172		$	1,260,037		$	772,153		$	1,021,055		$	1,206,605		$	3,607,362		$	3,193,313

Purchases as a percentage of originations for sale	48		%	63		%	67		%	71		%	76		%	57		%	77		%
Refinances as a percentage of originations for sale	52			37			33			29			24			43			23
Total	100		%	100		%	100		%	100		%	100		%	100		%	100		%

Production Margin:
Production revenue (B) (1)	$	42,713		$	29,895		$	16,606		$	18,657		$	25,253		$	89,214		$	73,593
Production margin (B / A)	3.01		%	2.59		%	2.45		%	2.01		%	2.19		%	2.74		%	2.43		%

Mortgage Servicing:
Loans serviced for others (C)	$	7,901,045		$	7,515,186		$	7,014,269		$	6,545,870		$	5,904,300
MSRs, at fair value (D)	75,585			72,850			71,022			75,183			74,530
Percentage of MSRs to loans serviced for others (D / C)	0.96		%	0.97		%	1.01		%	1.15		%	1.26		%

Components of Mortgage Banking Revenue:
Production revenue	$	42,713		$	29,895		$	16,606		$	18,657		$	25,253		$	89,214		$	73,593
MSR – current period capitalization	14,029			9,802			6,580			9,683			11,330			30,411			23,378
MSR – collection of expected cash flows – paydowns	(456		)	(457		)	(505		)	(496		)	(689		)	(1,418		)	(1,771		)
MSR – collection of expected cash flows – payoffs	(6,781		)	(3,619		)	(1,492		)	(896		)	(392		)	(11,892		)	(1,876		)
MSR – changes in fair value model assumptions	(4,058		)	(4,305		)	(8,744		)	(7,638		)	1,077			(17,107		)	7,307
Gain on derivative contract held as an economic hedge, net	82			920			—			—			—			1,002			—
MSR valuation adjustment, net of gain on derivative contract held as an economic hedge	(3,976		)	(3,385		)	(8,744		)	(7,638		)	1,077			(16,105		)	7,307
Servicing income	5,989			5,460			5,460			4,917			3,942			16,909			10,352
Other	(654		)	(285		)	253			(45		)	1,493			(686		)	1,825
Total mortgage banking revenue	$	50,864		$	37,411		$	18,158		$	24,182		$	42,014		$	106,433		$	112,808

Production revenue represents revenue earned from the origination and subsequent sale of mortgages, including gains on loans sold and fees from originations, processing and other related activities, and excludes servicing fees, changes in the fair value of servicing rights and changes to the mortgage recourse obligation.

TABLE 17: NON-INTEREST EXPENSE

	Three Months Ended										Q3 2019 compared to					Q3 2019 compared to
	Sep 30,		Jun 30,		Mar 31,		Dec 31,		Sep 30,		Q2 2019					Q3 2018
(Dollars in thousands)	2019		2019		2019		2018		2018		$ Change			% Change		$ Change			% Change
Salaries and employee benefits:
Salaries	$	78,067	$	75,360	$	74,037	$	67,708	$	69,893	$	2,707		4	%	$	8,174		12	%
Commissions and incentive compensation	40,289		36,486		31,599		33,656		34,046		3,803			10		6,243			18
Benefits	22,668		21,886		20,087		20,747		19,916		782			4		2,752			14
Total salaries and employee benefits	141,024		133,732		125,723		122,111		123,855		7,292			5		17,169			14
Equipment	13,314		12,759		11,770		11,523		10,827		555			4		2,487			23
Operating lease equipment depreciation	8,907		8,768		8,319		8,462		7,370		139			2		1,537			21
Occupancy, net	14,991		15,921		16,245		15,980		14,404		(930		)	(6	)	587			4
Data processing	6,522		6,204		7,525		8,447		9,335		318			5		(2,813		)	(30	)
Advertising and marketing	13,375		12,845		9,858		9,414		11,120		530			4		2,255			20
Professional fees	8,037		6,228		5,556		9,259		9,914		1,809			29		(1,877		)	(19	)
Amortization of other intangible assets	2,928		2,957		2,942		1,407		1,163		(29		)	(1	)	1,765			NM
FDIC insurance	148		4,127		3,576		4,044		4,205		(3,979		)	(96	)	(4,057		)	(96	)
OREO expense, net	1,170		1,290		632		1,618		596		(120		)	NM		574			96
Other:
Commissions – 3rd party brokers	734		749		718		779		1,059		(15		)	(2	)	(325		)	(31	)
Postage	2,321		2,606		2,450		2,047		2,205		(285		)	(11	)	116			5
Miscellaneous	21,083		21,421		19,060		16,242		17,584		(338		)	(2	)	3,499			20
Total other	24,138		24,776		22,228		19,068		20,848		(638		)	(3	)	3,290			16
Total Non-Interest Expense	$	234,554	$	229,607	$	214,374	$	211,333	$	213,637	$	4,947		2	%	$	20,917		10	%

NM – Not meaningful.

	Nine Months Ended
	Sep 30,		Sep 30,		$			%
(Dollars in thousands)	2019		2018		Change			Change
Salaries and employee benefits:
Salaries	$	227,464	$	198,855	$	28,609		14	%
Commissions and incentive compensation	108,374		101,902		6,472			6
Benefits	64,641		57,209		7,432			13
Total salaries and employee benefits	400,479		357,966		42,513			12
Equipment	37,843		31,426		6,417			20
Operating lease equipment depreciation	25,994		20,843		5,151			25
Occupancy, net	47,157		41,834		5,323			13
Data processing	20,251		26,580		(6,329		)	(24	)
Advertising and marketing	36,078		31,726		4,352			14
Professional fees	19,821		23,047		(3,226		)	(14	)
Amortization of other intangible assets	8,827		3,164		5,663			NM
FDIC insurance	7,851		13,165		(5,314		)	(40	)
OREO expense, net	3,092		4,502		(1,410		)	(31	)
Other:
Commissions – 3rd party brokers	2,201		3,485		(1,284		)	(37	)
Postage	7,377		6,638		739			11
Miscellaneous	61,564		50,379		11,185			22
Total other	71,142		60,502		10,640			18
Total Non-Interest Expense	$	678,535	$	614,755	$	63,780		10	%

NM – Not meaningful.

TABLE 18: SUPPLEMENTAL NON-GAAP FINANCIAL MEASURES/RATIOS

The accounting and reporting policies of Wintrust conform to generally accepted accounting principles (“GAAP”) in the United States and prevailing practices in the banking industry. However, certain non-GAAP performance measures and ratios are used by management to evaluate and measure the Company’s performance. These include taxable-equivalent net interest income (including its individual components), taxable-equivalent net interest margin (including its individual components), the taxable-equivalent efficiency ratio, tangible common equity ratio, tangible book value per common share and return on average tangible common equity. Management believes that these measures and ratios provide users of the Company’s financial information a more meaningful view of the performance of the Company’s interest-earning assets and interest-bearing liabilities and of the Company’s operating efficiency. Other financial holding companies may define or calculate these measures and ratios differently.

Management reviews yields on certain asset categories and the net interest margin of the Company and its banking subsidiaries on a fully taxable-equivalent basis. In this non-GAAP presentation, net interest income is adjusted to reflect tax-exempt interest income on an equivalent before-tax basis using tax rates effective as of the end of the period. This measure ensures comparability of net interest income arising from both taxable and tax-exempt sources. Net interest income on a fully taxable-equivalent basis is also used in the calculation of the Company’s efficiency ratio. The efficiency ratio, which is calculated by dividing non-interest expense by total taxable-equivalent net revenue (less securities gains or losses), measures how much it costs to produce one dollar of revenue. Securities gains or losses are excluded from this calculation to better match revenue from daily operations to operational expenses. Management considers the tangible common equity ratio and tangible book value per common share as useful measurements of the Company’s equity. The Company references the return on average tangible common equity as a measurement of profitability.

	Three Months Ended															Nine Months Ended
	Sep 30,			Jun 30,			Mar 31,			Dec 31,			Sep 30,			Sep 30,			Sep 30,
(Dollars and shares in thousands)	2019			2019			2019			2018			2018			2019			2018
Reconciliation of Non-GAAP Net Interest Margin and Efficiency Ratio:
(A) Interest Income (GAAP)	$	354,627		$	346,814		$	333,970		$	320,596		$	304,962		$	1,035,411		$	850,214
Taxable-equivalent adjustment:
– Loans	978			1,031			1,034			980			941			3,043			2,423
– Liquidity Management Assets	574			568			565			586			575			1,707			1,672
– Other Earning Assets	5			1			2			4			3			8			7
(B) Interest Income (non-GAAP)	$	356,184		$	348,414		$	335,571		$	322,166		$	306,481		$	1,040,169		$	854,316
(C) Interest Expense (GAAP)	$	89,775		$	80,612		$	71,984		$	66,508		$	57,399		$	242,371		$	139,399
(D) Net Interest Income (GAAP) (A minus C)	$	264,852		$	266,202		$	261,986		$	254,088		$	247,563		$	793,040		$	710,815
(E) Net Interest Income (non-GAAP) (B minus C)	$	266,409		$	267,802		$	263,587		$	255,658		$	249,082		$	797,798		$	714,917
Net interest margin (GAAP)	3.37		%	3.62		%	3.70		%	3.61		%	3.59		%	3.56		%	3.58		%
Net interest margin, fully taxable-equivalent (non-GAAP)	3.39		%	3.64		%	3.72		%	3.63		%	3.61		%	3.58		%	3.6		%
(F) Non-interest income	$	115,137		$	98,158		$	81,657		$	75,308		$	99,930		$	294,952		$	280,842
(G) Gains (losses) on investment securities, net	710			864			1,364			(2,649		)	90			2,938			(249		)
(H) Non-interest expense	234,554			229,607			214,374			211,333			213,637			678,535			614,755
Efficiency ratio (H/(D+F-G))	61.84		%	63.17		%	62.63		%	63.65		%	61.50		%	62.53		%	61.98		%
Efficiency ratio (non-GAAP) (H/(E+F-G))	61.59		%	62.89		%	62.34		%	63.35		%	61.23		%	62.26		%	61.72		%

Reconciliation of Non-GAAP Tangible Common Equity Ratio:
Total shareholders’ equity (GAAP)	$	3,540,325		$	3,446,950		$	3,371,972		$	3,267,570		$	3,179,822
Less: Non-convertible preferred stock (GAAP)	(125,000		)	(125,000		)	(125,000		)	(125,000		)	(125,000		)
Less: Intangible assets (GAAP)	(627,972		)	(631,499		)	(620,224		)	(622,565		)	(564,938		)
(I) Total tangible common shareholders’ equity (non-GAAP)	$	2,787,353		$	2,690,451		$	2,626,748		$	2,520,005		$	2,489,884
(J) Total assets (GAAP)	$	34,911,902		$	33,641,769		$	32,358,621		$	31,244,849		$	30,142,731
Less: Intangible assets (GAAP)	(627,972		)	(631,499		)	(620,224		)	(622,565		)	(564,938		)
(K) Total tangible assets (non-GAAP)	$	34,283,930		$	33,010,270		$	31,738,397		$	30,622,284		$	29,577,793
Common equity to assets ratio (GAAP) (L/J)	9.8		%	9.9		%	10.0		%	10.1		%	10.1		%
Tangible common equity ratio (non-GAAP) (I/K)	8.1		%	8.2		%	8.3		%	8.2		%	8.4		%

	Three Months Ended															Nine Months Ended
	Sep 30,			Jun 30,			Mar 31,			Dec 31,			Sep 30,			Sep 30,			Sep 30,
(Dollars and shares in thousands)	2019			2019			2019			2018			2018			2019			2018
Reconciliation of Non-GAAP Tangible Book Value per Common Share:
Total shareholders’ equity	$	3,540,325		$	3,446,950		$	3,371,972		$	3,267,570		$	3,179,822
Less: Preferred stock	(125,000		)	(125,000		)	(125,000		)	(125,000		)	(125,000		)
(L) Total common equity	$	3,415,325		$	3,321,950		$	3,246,972		$	3,142,570		$	3,054,822
(M) Actual common shares outstanding	56,698			56,668			56,639			56,408			56,377
Book value per common share (L/M)	$	60.24		$	58.62		$	57.33		$	55.71		$	54.19
Tangible book value per common share (non-GAAP) (I/M)	$	49.16		$	47.48		$	46.38		$	44.67		$	44.16

Reconciliation of Non-GAAP Return on Average Tangible Common Equity:
(N) Net income applicable to common shares	$	97,071		$	79,416		$	87,096		$	77,607		$	89,898		$	263,583		$	257,359
Add: Intangible asset amortization	2,928			2,957			2,942			1,407			1,163			8,827			3,164
Less: Tax effect of intangible asset amortization	(773		)	(771		)	(731		)	(366		)	(292		)	(2,277		)	(798		)
After-tax intangible asset amortization	2,155			2,186			2,211			1,041			871			6,550			2,366
(O) Tangible net income applicable to common shares (non-GAAP)	$	99,226		$	81,602		$	89,307		$	78,648		$	90,769		$	270,133		$	259,725
Total average shareholders’ equity	$	3,496,714		$	3,414,340		$	3,309,078		$	3,200,654		$	3,131,943		$	3,407,398		$	3,064,396
Less: Average preferred stock	(125,000		)	(125,000		)	(125,000		)	(125,000		)	(125,000		)	(125,000		)	(125,000		)
(P) Total average common shareholders’ equity	$	3,371,714		$	3,289,340		$	3,184,078		$	3,075,654		$	3,006,943		$	3,282,398		$	2,939,396
Less: Average intangible assets	(630,279		)	(624,794		)	(622,240		)	(574,757		)	(547,552		)	(625,800		)	(539,281		)
(Q) Total average tangible common shareholders’ equity (non-GAAP)	$	2,741,435		$	2,664,546		$	2,561,838		$	2,500,897		$	2,459,391		$	2,656,598		$	2,400,115
Return on average common equity, annualized (N/P)	11.42		%	9.68		%	11.09		%	10.01		%	11.86		%	10.74		%	11.71		%
Return on average tangible common equity, annualized (non-GAAP) (O/Q)	14.36		%	12.28		%	14.14		%	12.48		%	14.64		%	13.6		%	14.47		%

WINTRUST SUBSIDIARIES AND LOCATIONS

Wintrust is a financial holding company whose common stock is traded on the Nasdaq Global Select Market (Nasdaq: WTFC). Its 15 community bank subsidiaries are: Lake Forest Bank & Trust Company, N.A., Hinsdale Bank & Trust Company, Wintrust Bank, N.A., in Chicago, Libertyville Bank & Trust Company, N.A., Barrington Bank & Trust Company, N.A., Crystal Lake Bank & Trust Company, N.A., Northbrook Bank & Trust Company, N.A., Schaumburg Bank & Trust Company, N.A., Village Bank & Trust, N.A., in Arlington Heights, Beverly Bank & Trust Company, N.A. in Chicago, Wheaton Bank & Trust Company, N.A., State Bank of The Lakes, N.A., in Antioch, Old Plank Trail Community Bank, N.A. in New Lenox, St. Charles Bank & Trust Company and Town Bank, N.A., in Hartland, Wisconsin.

The banks also operate facilities in Illinois in Addison, Algonquin, Aurora, Bloomingdale, Buffalo Grove, Cary, Clarendon Hills, Crete, Deerfield, Des Plaines, Downers Grove, Elgin, Elk Grove Village, Elmhurst, Evanston, Evergreen Park, Frankfort, Geneva, Glen Ellyn, Glencoe, Glenview, Gurnee, Grayslake, Hanover Park, Highland Park, Highwood, Hoffman Estates, Island Lake, Itasca, Joliet, Lake Bluff, Lake Villa, Lansing, Lemont, Lindenhurst, Lynwood, Markham, McHenry, Mokena, Mount Prospect, Mundelein, Naperville, North Chicago, Northfield, Norridge, Oak Lawn, Orland Park, Palatine, Park Ridge, Prospect Heights, Ravinia, Riverside, Rolling Meadows, Roselle, Round Lake Beach, Shorewood, Skokie, South Holland, Spring Grove, Steger, Stone Park, Vernon Hills, Wauconda, Waukegan, Western Springs, Willowbrook, Wilmette, Winnetka and Wood Dale, in Albany, Burlington, Clinton, Darlington, Delafield, Delavan, Elm Grove, Genoa City, Kenosha, Lake Geneva, Madison, Menomonee Falls, Milwaukee, Monroe, Pewaukee, Racine, Sharon, Wales, Walworth and Wind Lake, Wisconsin, in Dyer, Indiana and in Naples, Florida.

Additionally, the Company operates various non-bank business units:

FIRST Insurance Funding, a division of Lake Forest Bank & Trust Company, N.A., and Wintrust Life Finance, a division of Lake Forest Bank & Trust Company, N.A., serve commercial and life insurance loan customers, respectively, throughout the United States.
First Insurance Funding of Canada serves commercial insurance loan customers throughout Canada.
Tricom, Inc. of Milwaukee provides high-yielding, short-term accounts receivable financing and value-added out-sourced administrative services, such as data processing of payrolls, billing and cash management services, to temporary staffing service clients located throughout the United States.
Wintrust Mortgage, a division of Barrington Bank & Trust Company, N.A., engages primarily in the origination and purchase of residential mortgages for sale into the secondary market through origination offices located throughout the United States. Loans are also originated nationwide through relationships with wholesale and correspondent offices.
Wintrust Investments, LLC is a broker-dealer providing a full range of private client and brokerage services to clients and correspondent banks located primarily in the Midwest.
Great Lakes Advisors LLC provides money management services and advisory services to individual accounts.
The Chicago Trust Company, N.A., a trust subsidiary, allows Wintrust to service customers’ trust and investment needs at each banking location.
Wintrust Asset Finance offers direct leasing opportunities.
CDEC provides Qualified Intermediary services (as defined by U.S. Treasury regulations) for taxpayers seeking to structure tax-deferred like-kind exchanges under Internal Revenue Code Section 1031.

FORWARD-LOOKING STATEMENTS

This document contains forward-looking statements within the meaning of federal securities laws. Forward-looking information can be identified through the use of words such as “intend,” “plan,” “project,” “expect,” “anticipate,” “believe,” “estimate,” “contemplate,” “possible,” “will,” “may,” “should,” “would” and “could.” Forward-looking statements and information are not historical facts, are premised on many factors and assumptions, and represent only management’s expectations, estimates and projections regarding future events. Similarly, these statements are not guarantees of future performance and involve certain risks and uncertainties that are difficult to predict, which may include, but are not limited to, those listed below and the Risk Factors discussed under Item 1A of the Company’s 2018 Annual Report on Form 10-K and in any of the Company’s subsequent SEC filings. The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and is including this statement for purposes of invoking these safe harbor provisions. Such forward-looking statements may be deemed to include, among other things, statements relating to the Company’s future financial performance, the performance of its loan portfolio, the expected amount of future credit reserves and charge-offs, delinquency trends, growth plans, regulatory developments, securities that the Company may offer from time to time, and management’s long-term performance goals, as well as statements relating to the anticipated effects on financial condition and results of operations from expected developments or events, the Company’s business and growth strategies, including future acquisitions of banks, specialty finance or wealth management businesses, internal growth and plans to form additional de novo banks or branch offices. Actual results could differ materially from those addressed in the forward-looking statements as a result of numerous factors, including the following:

economic conditions that affect the economy, housing prices, the job market and other factors that may adversely affect the Company’s liquidity and the performance of its loan portfolios, particularly in the markets in which it operates;
negative effects suffered by us or our customers resulting from changes in U.S. trade policies;
the extent of defaults and losses on the Company’s loan portfolio, which may require further increases in its allowance for credit losses;
estimates of fair value of certain of the Company’s assets and liabilities, which could change in value significantly from period to period;
the financial success and economic viability of the borrowers of our commercial loans;
commercial real estate market conditions in the Chicago metropolitan area and southern Wisconsin;
the extent of commercial and consumer delinquencies and declines in real estate values, which may require further increases in the Company’s allowance for loan and lease losses;
inaccurate assumptions in our analytical and forecasting models used to manage our loan portfolio;
changes in the level and volatility of interest rates, the capital markets and other market indices that may affect, among other things, the Company’s liquidity and the value of its assets and liabilities;
competitive pressures in the financial services business which may affect the pricing of the Company’s loan and deposit products as well as its services (including wealth management services), which may result in loss of market share and reduced income from deposits, loans, advisory fees and income from other products;
failure to identify and complete favorable acquisitions in the future or unexpected difficulties or developments related to the integration of the Company’s recent or future acquisitions;
unexpected difficulties and losses related to FDIC-assisted acquisitions;
harm to the Company’s reputation;
any negative perception of the Company’s financial strength;
ability of the Company to raise additional capital on acceptable terms when needed;
disruption in capital markets, which may lower fair values for the Company’s investment portfolio;
ability of the Company to use technology to provide products and services that will satisfy customer demands and create efficiencies in operations and to manage risks associated therewith;
failure or breaches of our security systems or infrastructure, or those of third parties;
security breaches, including denial of service attacks, hacking, social engineering attacks, malware intrusion or data corruption attempts and identity theft;
adverse effects on our information technology systems resulting from failures, human error or cyberattacks;
adverse effects of failures by our vendors to provide agreed upon services in the manner and at the cost agreed, particularly our information technology vendors;
increased costs as a result of protecting our customers from the impact of stolen debit card information;
accuracy and completeness of information the Company receives about customers and counterparties to make credit decisions;
ability of the Company to attract and retain senior management experienced in the banking and financial services industries;
environmental liability risk associated with lending activities;
the impact of any claims or legal actions to which the Company is subject, including any effect on our reputation;
losses incurred in connection with repurchases and indemnification payments related to mortgages and increases in reserves associated therewith;
the loss of customers as a result of technological changes allowing consumers to complete their financial transactions without the use of a bank;
the soundness of other financial institutions;
the expenses and delayed returns inherent in opening new branches and de novo banks;
examinations and challenges by tax authorities, and any unanticipated impact of the Tax Act;
changes in accounting standards, rules and interpretations such as the new CECL standard, and the impact on the Company’s financial statements;
the ability of the Company to receive dividends from its subsidiaries;
uncertainty about the future of LIBOR;
a decrease in the Company’s capital ratios, including as a result of declines in the value of its loan portfolios, or otherwise;
legislative or regulatory changes, particularly changes in regulation of financial services companies and/or the products and services offered by financial services companies;
a lowering of our credit rating;
changes in U.S. monetary policy and changes to the Federal Reserve’s balance sheet as a result of the end of its program of quantitative easing or otherwise;
restrictions upon our ability to market our products to consumers and limitations on our ability to profitably operate our mortgage business resulting from the Dodd-Frank Act;
increased costs of compliance, heightened regulatory capital requirements and other risks associated with changes in regulation and the regulatory environment;
the impact of heightened capital requirements;
increases in the Company’s FDIC insurance premiums, or the collection of special assessments by the FDIC;
delinquencies or fraud with respect to the Company’s premium finance business;
credit downgrades among commercial and life insurance providers that could negatively affect the value of collateral securing the Company’s premium finance loans;
the Company’s ability to comply with covenants under its credit facility; and
fluctuations in the stock market, which may have an adverse impact on the Company’s wealth management business and brokerage operation.

Therefore, there can be no assurances that future actual results will correspond to these forward-looking statements. The reader is cautioned not to place undue reliance on any forward-looking statement made by the Company. Any such statement speaks only as of the date the statement was made or as of such date that may be referenced within the statement. The Company undertakes no obligation to update any forward-looking statement to reflect the impact of circumstances or events after the date of the press release. Persons are advised, however, to consult further disclosures management makes on related subjects in its reports filed with the Securities and Exchange Commission and in its press releases.

CONFERENCE CALL, WEBCAST AND REPLAY

The Company will hold a conference call on Thursday, October 17, 2019 at 1:00 p.m. (Central Time) regarding third quarter 2019 results. Individuals interested in listening should call (877) 363-5049 and enter Conference ID #6168809. A simultaneous audio-only webcast and replay of the conference call as well as an accompanying slide presentation may be accessed via the Company’s website at https://www.wintrust.com, Investor Relations, Investor News and Events, Presentations & Conference Calls. The text of the third quarter 2019 earnings press release will be available on the home page of the Company’s website at https://www.wintrust.com and at the Investor Relations, Investor News and Events, Press Releases link on its website.

FOR MORE INFORMATION CONTACT:
Edward J. Wehmer, President & Chief Executive Officer
David A. Dykstra, Senior Executive Vice President & Chief Operating Officer
(847) 939-9000
Web site address: www.wintrust.com

Wintrust Financial Corporation Reports Record Third Quarter 2019 Net Income of $99.1 million and Year-to-Date Net Income of $269.7 million

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