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

October 16, 2019 5:20 PM

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

Other highlights of the third quarter of 2019

Expansion activity

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.http://ml.globenewswire.com/Resource/Download/0c9b01f4-86a2-4cf4-a4bc-2e30aca663de

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 CORPORATIONKey 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 from2nd Quarter2019 % orbasis point (bp)change from3rd Quarter2018
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 – diluted1.69 1.38 1.57 22 8
Net revenue (1)379,989 364,360 347,493 4 9
Net interest income264,852 266,202 247,563 (1) 7
Net interest margin3.37% 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 assets1.16 1.02 1.24 14 (8)
Return on average common equity11.42 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 deposits28,710,379 27,518,815 24,916,715 17 15
Total shareholders’ equity3,540,325 3,446,950 3,179,822 11 11
  1. Net revenue is net interest income plus non-interest income.
  2. See "Supplemental Non-GAAP Financial Measures/Ratios" at Table 18 for additional information on this performance measure/ratio.
  3. 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.
  4. Period-end balance sheet percentage changes are annualized.
  5. 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 CORPORATIONSelected Financial Highlights

Three Months EndedNine Months Ended
(Dollars in thousands, except per share data)Sep 30,2019 Jun 30,2019 Mar 31,2019 Dec 31,2018 Sep 30,2018Sep 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 deposits28,710,379 27,518,815 26,804,742 26,094,678 24,916,715
Junior subordinated debentures253,566 253,566 253,566 253,566 253,566
Total shareholders’ equity3,540,325 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 income99,121 81,466 89,146 79,657 91,948 269,733 263,509
Net income per common share – Basic1.71 1.40 1.54 1.38 1.59 4.65 4.57
Net income per common share – Diluted1.69 1.38 1.52 1.35 1.57 4.60 4.50
Selected Financial Ratios and Other Data:
Performance Ratios:
Net interest margin3.37% 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 assets1.35 1.23 1.06 0.99 1.34 1.22 1.31
Non-interest expense to average assets2.74 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 assets1.16 1.02 1.16 1.05 1.24 1.11 1.23
Return on average common equity11.42 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’ equity3,496,714 3,414,340 3,309,078 3,200,654 3,131,943 3,407,398 3,064,396
Average loans to average deposits ratio90.6% 93.9% 92.7% 92.4% 92.2%92.4% 94.2%
Period-end loans to deposits ratio89.6 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 share60.24 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 outstanding56,698,429 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 loans114,284 113,447 117,586 113,234 127,227
Allowance for credit losses to total loans (6)0.64% 0.64% 0.66% 0.65% 0.65%
Non-performing loans to total loans0.44 0.45 0.49 0.48 0.55
Number of:
Bank subsidiaries15 15 15 15 15
Banking offices174 172 170 167 166
  1. Excludes mortgage loans held-for-sale.
  2. Net revenue includes net interest income and non-interest income.
  3. See “Supplemental Non-GAAP Financial Measures/Ratios” at Table 18 for additional information on this performance measure/ratio.
  4. 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.
  5. Capital ratios for current quarter-end are estimated.
  6. The allowance for credit losses includes both the allowance for loan losses and the allowance for unfunded lending-related commitments.

WINTRUST FINANCIAL CORPORATION AND SUBSIDIARIESCONSOLIDATED 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 agreements59 58 58 58 57
Interest bearing deposits with banks2,260,806 1,437,105 1,609,852 1,099,594 1,137,044
Available-for-sale securities, at fair value2,270,059 2,186,154 2,185,782 2,126,081 2,164,985
Held-to-maturity securities, at amortized cost1,095,802 1,191,634 1,051,542 1,067,439 966,438
Trading account securities3,204 2,430 559 1,692 688
Equity securities with readily determinable fair value46,086 44,319 47,653 34,717 36,414
Federal Home Loan Bank and Federal Reserve Bank stock92,714 92,026 89,013 91,354 99,998
Brokerage customer receivables14,943 13,569 14,219 12,609 15,649
Mortgage loans held-for-sale464,727 394,975 248,557 264,070 338,111
Loans, net of unearned income25,710,171 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 loans25,548,408 25,144,238 24,056,417 23,667,921 22,974,195
Premises and equipment, net721,856 711,214 676,037 671,169 664,469
Lease investments, net228,647 230,111 224,240 233,208 199,241
Accrued interest receivable and other assets1,087,864 1,023,896 888,492 696,707 700,568
Trade date securities receivable— 237,607 375,211 263,523 —
Goodwill584,315 584,911 573,658 573,141 537,560
Other intangible assets43,657 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 bearing21,642,419 20,798,857 20,451,286 19,524,798 18,517,502
Total deposits28,710,379 27,518,815 26,804,742 26,094,678 24,916,715
Federal Home Loan Bank advances574,847 574,823 576,353 426,326 615,000
Other borrowings410,488 418,057 372,194 393,855 373,571
Subordinated notes435,979 436,021 139,235 139,210 139,172
Junior subordinated debentures253,566 253,566 253,566 253,566 253,566
Trade date securities payable226 — — — —
Accrued interest payable and other liabilities986,092 993,537 840,559 669,644 664,885
Total liabilities31,371,577 30,194,819 28,986,649 27,977,279 26,962,909
Shareholders’ Equity:
Preferred stock125,000 125,000 125,000 125,000 125,000
Common stock56,825 56,794 56,765 56,518 56,486
Surplus1,574,011 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 earnings1,830,165 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’ equity3,540,325 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 SUBSIDIARIESCONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

Three Months EndedNine 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-sale3,478 3,104 2,209 3,409 5,285 8,791 12,329
Interest bearing deposits with banks10,326 5,206 5,300 5,628 5,423 20,832 11,462
Federal funds sold and securities purchased under resale agreements310 — — — — 310 1
Investment securities24,758 27,721 27,956 26,656 21,710 80,435 60,726
Trading account securities20 5 8 14 11 33 29
Federal Home Loan Bank and Federal Reserve Bank stock1,294 1,439 1,355 1,343 1,235 4,088 3,988
Brokerage customer receivables164 178 155 235 164 497 488
Total interest income354,627 346,814 333,970 320,596 304,962 1,035,411 850,214
Interest expense
Interest on deposits76,168 67,024 60,976 55,975 48,736 204,168 110,578
Interest on Federal Home Loan Bank advances1,774 4,193 2,450 2,563 1,947 8,417 9,849
Interest on other borrowings3,466 3,525 3,633 3,199 2,003 10,624 5,400
Interest on subordinated notes5,470 2,806 1,775 1,788 1,773 10,051 5,333
Interest on junior subordinated debentures2,897 3,064 3,150 2,983 2,940 9,111 8,239
Total interest expense89,775 80,612 71,984 66,508 57,399 242,371 139,399
Net interest income264,852 266,202 261,986 254,088 247,563 793,040 710,815
Provision for credit losses10,834 24,580 10,624 10,401 11,042 46,038 24,431
Net interest income after provision for credit losses254,018 241,622 251,362 243,687 236,521 747,002 686,384
Non-interest income
Wealth management23,999 24,139 23,977 22,726 22,634 72,115 68,237
Mortgage banking50,864 37,411 18,158 24,182 42,014 106,433 112,808
Service charges on deposit accounts9,972 9,277 8,848 9,065 9,331 28,097 27,339
Gains (losses) on investment securities, net710 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), net11 (44) (171) (155) (61) (204) 166
Operating lease income, net12,025 11,733 10,796 10,882 9,132 34,554 27,569
Other17,556 14,135 16,901 10,631 16,163 48,592 42,079
Total non-interest income115,137 98,158 81,657 75,308 99,930 294,952 280,842
Non-interest expense
Salaries and employee benefits141,024 133,732 125,723 122,111 123,855 400,479 357,966
Equipment13,314 12,759 11,770 11,523 10,827 37,843 31,426
Operating lease equipment depreciation8,907 8,768 8,319 8,462 7,370 25,994 20,843
Occupancy, net14,991 15,921 16,245 15,980 14,404 47,157 41,834
Data processing6,522 6,204 7,525 8,447 9,335 20,251 26,580
Advertising and marketing13,375 12,845 9,858 9,414 11,120 36,078 31,726
Professional fees8,037 6,228 5,556 9,259 9,914 19,821 23,047
Amortization of other intangible assets2,928 2,957 2,942 1,407 1,163 8,827 3,164
FDIC insurance148 4,127 3,576 4,044 4,205 7,851 13,165
OREO expense, net1,170 1,290 632 1,618 596 3,092 4,502
Other24,138 24,776 22,228 19,068 20,848 71,142 60,502
Total non-interest expense234,554 229,607 214,374 211,333 213,637 678,535 614,755
Income before taxes134,601 110,173 118,645 107,662 122,814 363,419 352,471
Income tax expense35,480 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 dividends2,050 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 outstanding56,690 56,662 56,529 56,395 56,366 56,627 56,268
Dilutive potential common shares773 699 699 892 918 724 912
Average common shares and dilutive common shares57,463 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 30,2018Dec 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 estate7,448,667 7,276,244 6,973,505 6,933,252 6,746,774 10 10
Home equity512,303 527,370 528,448 552,343 578,844 (10) (11)
Residential real estate1,218,666 1,118,178 1,053,524 1,002,464 924,250 29 32
Premium finance receivables - commercial3,449,950 3,368,423 2,988,788 2,841,659 2,885,327 29 20
Premium finance receivables - life insurance4,795,496 4,634,478 4,555,369 4,541,794 4,398,971 7 9
Consumer and other89,487 109,192 120,804 120,641 115,827 (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:
Commercial32% 33% 33% 33% 32%
Commercial real estate29 29 29 29 29
Home equity2 2 2 2 3
Residential real estate5 4 4 4 4
Premium finance receivables - commercial13 13 12 12 12
Premium finance receivables - life insurance19 18 19 19 19
Consumer and other0 1 1 1 1
Total loans, net of unearned income100% 100% 100% 100% 100%
  1. Annualized.

TABLE 2: COMMERCIAL AND COMMERCIAL REAL ESTATE LOAN PORTFOLIOS

As of September 30, 2019
(Dollars in thousands)Balance % ofTotalBalance Nonaccrual > 90 DaysPast Dueand StillAccruing AllowanceFor LoanLossesAllocation
Commercial:
Commercial, industrial and other$5,150,567 32.9% $34,397 $— $51,463
Franchise914,774 5.9 3,752 — 8,308
Mortgage warehouse lines of credit314,697 2.0 — — 2,481
Asset-based lending1,045,869 6.7 5,782 — 8,445
Leases754,163 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
Land175,386 1.1 994 — 4,801
Office996,931 6.4 8,158 — 10,066
Industrial1,009,680 6.5 100 — 7,021
Retail1,004,720 6.4 7,174 — 6,718
Multi-family1,291,825 8.3 690 — 12,504
Mixed use and other2,002,267 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%
Wisconsin744,577 10.0
Total primary markets$6,399,404 85.9%
Indiana193,350 2.6
Florida80,120 1.1
Arizona62,657 0.8
California67,999 0.9
Other645,137 8.7
Total commercial real estate$7,448,667 100.0%
  1. 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 30,2018Dec 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 deposits2,966,098 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 market7,326,899 6,460,098 6,093,596 5,704,866 5,429,921 38 35
Savings2,934,348 2,823,904 2,729,626 2,665,194 2,595,164 14 13
Time certificates of deposit5,619,236 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 bearing25% 24% 24% 25% 26%
NOW and interest bearing demand deposits10 10 11 11 10
Wealth management deposits (2)10 12 12 12 10
Money market25 24 23 22 22
Savings10 10 10 10 10
Time certificates of deposit20 20 20 20 22
Total deposits100% 100% 100% 100% 100%
  1. Annualized.
  2. 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 ANALYSISAs of September 30, 2019

(Dollars in thousands)CDARs &BrokeredCertificates of Deposit (1) MaxSafeCertificates of Deposit (1) Variable RateCertificates of Deposit (2) Other FixedRate Certificates of Deposit (1) Total TimeCertificates ofDeposit Weighted-AverageRate of MaturingTime 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 months1,000 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%
  1. This category of certificates of deposit is shown by contractual maturity date.
  2. This category includes variable rate certificates of deposit and savings certificates with the majority repricing on at least a monthly basis.
  3. 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 stock92,583 105,491 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-sale379,870 281,732 188,190 265,717 380,235
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 banks297,475 273,679 283,019 271,403 268,006
Other assets2,618,000 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 deposits2,888,817 2,605,690 2,614,035 2,289,904 2,517,141
Money market accounts6,956,755 6,095,285 5,915,525 5,632,268 5,369,324
Savings accounts2,837,039 2,752,828 2,715,422 2,553,133 2,672,077
Time deposits5,590,228 5,322,384 5,267,796 5,381,029 5,214,637
Interest-bearing deposits21,185,800 19,654,208 19,316,116 18,527,617 18,292,624
Federal Home Loan Bank advances574,833 869,812 594,335 551,846 429,739
Other borrowings416,300 419,064 465,571 385,878 268,278
Subordinated notes436,041 220,771 139,217 139,186 139,155
Junior subordinated debentures253,566 253,566 253,566 253,566 253,566
Total interest-bearing liabilities22,866,540 21,417,421 20,768,805 19,858,093 19,383,362
Non-interest bearing deposits6,776,786 6,487,627 6,444,378 6,542,228 6,461,195
Other liabilities814,552 736,381 693,910 578,912 548,609
Equity3,496,714 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
  1. Includes interest-bearing deposits from banks, federal funds sold and securities purchased under resale agreements.
  2. 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.
  3. Other earning assets include brokerage customer receivables and trading account securities.
  4. Loans, net of unearned income, include non-accrual loans.
  5. 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.
  6. 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 securities25,332 28,290 28,521 27,242 22,285
FHLB and FRB stock1,294 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-sale3,478 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 deposits9,163 7,091 7,000 7,119 8,287
Money market accounts25,426 21,451 19,460 16,936 13,260
Savings accounts5,622 4,959 4,249 3,096 2,907
Time deposits30,666 27,970 25,654 24,817 21,803
Interest-bearing deposits76,168 67,024 60,976 55,975 48,736
Federal Home Loan Bank advances1,774 4,193 2,450 2,563 1,947
Other borrowings3,466 3,525 3,633 3,199 2,003
Subordinated notes5,470 2,806 1,775 1,788 1,773
Junior subordinated debentures2,897 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 adjustment1,557 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

  1. See "Supplemental Non-GAAP Financial Measures/Ratios" at Table 18 for additional information on this performance measure/ratio.
  2. 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 equivalents2.15% 2.34% 2.39% 2.14% 2.16%
Investment securities2.95 3.11 3.19 3.23 2.90
FHLB and FRB stock5.55 5.47 5.79 5.43 5.54
Liquidity management assets2.71 3.01 3.09 3.02 2.78
Other earning assets4.20 4.68 4.91 6.19 3.95
Mortgage loans held-for-sale3.63 4.42 4.76 5.09 5.51
Loans, net of unearned income4.93 5.07 5.06 4.87 4.73
Total earning assets4.53% 4.74% 4.74% 4.58% 4.45%
Rate paid on:
NOW and interest bearing demand deposits0.72% 0.77% 0.67% 0.60% 0.39%
Wealth management deposits1.26 1.09 1.09 1.23 1.31
Money market accounts1.45 1.41 1.33 1.19 0.98
Savings accounts0.79 0.72 0.63 0.48 0.43
Time deposits2.18 2.11 1.98 1.83 1.66
Interest-bearing deposits1.43 1.37 1.29 1.20 1.06
Federal Home Loan Bank advances1.22 1.93 1.67 1.84 1.80
Other borrowings3.30 3.37 3.16 3.29 2.96
Subordinated notes5.02 5.08 5.10 5.14 5.10
Junior subordinated debentures4.47 4.78 4.97 4.60 4.54
Total interest-bearing liabilities1.56% 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 adjustment0.02 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%

  1. Interest rate spread is the difference between the yield earned on earning assets and the rate paid on interest-bearing liabilities.
  2. 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.
  3. 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 Balancefor nine months ended,Interestfor nine months ended,Yield/Ratefor nine months ended,
(Dollars in thousands)Sep 30,2019 Sep 30,2018Sep 30,2019 Sep 30,2018Sep 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 stock97,624 102,893 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-sale283,966 355,491 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 banks284,779 264,294
Other assets2,482,970 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 deposits2,703,853 2,378,468 23,254 20,721 1.15 1.16
Money market accounts6,326,336 4,927,639 66,337 26,038 1.40 0.71
Savings accounts2,768,875 2,728,986 14,830 8,348 0.72 0.41
Time deposits5,394,651 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 advances679,589 768,029 8,417 9,849 1.66 1.71
Other borrowings433,465 257,175 10,624 5,400 3.28 2.81
Subordinated notes266,430 139,125 10,051 5,333 5.03 5.11
Junior subordinated debentures253,566 253,566 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 deposits6,570,815 6,546,269
Other liabilities748,722 517,712
Equity3,407,398 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%

  1. Includes interest-bearing deposits from banks, federal funds sold and securities purchased under resale agreements.
  2. 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.
  3. 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.
  4. Other earning assets include brokerage customer receivables and trading account securities.
  5. Loans, net of unearned income, include non-accrual loans.
  6. Interest rate spread is the difference between the yield earned on earning assets and the rate paid on interest-bearing liabilities.
  7. 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.
  8. 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, 201920.7% 10.5% (11.9)%
Jun 30, 201917.3 8.9 (10.2)
Mar 31, 201914.9 7.8 (8.5)
Dec 31, 201815.6 7.9 (8.6)
Sep 30, 201818.1 9.1 (10.0)

Ramp Scenario+200 Basis Points +100 Basis Points -100 Basis Points
Sep 30, 201910.1% 5.2% (5.6)%
Jun 30, 20198.3 4.3 (4.6)
Mar 31, 20196.7 3.5 (3.3)
Dec 31, 20187.4 3.8 (3.6)
Sep 30, 20188.5 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 rate206,052 1,213,099 822,338 2,241,489
Variable rate5,947,908 6,067 138 5,954,113
Total commercial$6,153,960 $1,219,166 $822,476 $8,195,602
Commercial real estate
Fixed rate463,155 2,043,088 341,511 2,847,754
Variable rate4,573,350 27,555 8 4,600,913
Total commercial real estate$5,036,505 $2,070,643 $341,519 $7,448,667
Home equity
Fixed rate23,952 5,642 19,614 49,208
Variable rate462,790 305 — 463,095
Total home equity$486,742 $5,947 $19,614 $512,303
Residential real estate
Fixed rate28,980 19,581 302,634 351,195
Variable rate57,238 345,029 465,204 867,471
Total residential real estate$86,218 $364,610 $767,838 $1,218,666
Premium finance receivables - commercial
Fixed rate3,365,631 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 rate12,242 121,600 26,667 160,509
Variable rate4,634,987 — — 4,634,987
Total premium finance receivables - life insurance$4,647,229 $121,600 $26,667 $4,795,496
Consumer and other
Fixed rate51,386 9,802 1,943 63,131
Variable rate26,356 — — 26,356
Total consumer and other$77,742 $9,802 $1,943 $89,487
Total per category
Fixed rate4,151,398 3,497,131 1,514,707 9,163,236
Variable rate15,702,629 378,956 465,350 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-8e64a47f0076Source: 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-monthLIBOR 12-monthLIBOR
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 EndedNine Months Ended
Sep 30, Jun 30, Mar 31, Dec 31, Sep 30,Sep 30, Sep 30,
(Dollars in thousands) 2019 2019 2019 2018 20182019 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 EndedNine Months Ended
Sep 30, Jun 30, Mar 31, Dec 31, Sep 30,Sep 30, Sep 30,
(Dollars in thousands)2019 2019 2019 2018 20182019 2018
Provision for loan losses$10,804 $24,510 $10,608 $10,251 $11,040 $45,922 $24,455
Provision for unfunded lending-related commitments30 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, 2019As of June 30, 2019
(Dollars in thousands)RecordedInvestment CalculatedAllowance % of itscategory’s balanceRecorded 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 lending1,043,384 8,445 0.81 1,066,231 9,335 0.88
Tax exempt503,495 2,957 0.59 489,524 2,808 0.57
Leases749,135 2,069 0.28 674,251 1,879 0.28
Commercial real estate: (1)
Residential construction35,662 625 1.75 39,633 797 2.01
Commercial construction810,919 8,757 1.08 792,782 8,523 1.08
Land168,092 4,801 2.86 138,255 4,193 3.03
Office964,557 10,066 1.04 925,150 9,778 1.06
Industrial972,859 7,015 0.72 921,116 6,589 0.72
Retail960,762 6,718 0.70 930,594 6,515 0.70
Multi-family1,239,217 12,504 1.01 1,184,025 11,983 1.01
Mixed use and other1,918,510 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 credit314,697 2,481 0.79 275,170 2,195 0.80
Community Advantage - homeowner associations202,724 507 0.25 192,056 481 0.25
Aircraft11,112 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 loans3,016,644 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%

  1. Excludes purchased loans reported in accordance with ASC 310-20 and ASC 310-30.
  2. 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 days past
(Dollars in thousands) Nonaccrual accruing due 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 — 95 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 55 272 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 0.1 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 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 0.1 0.3 99.3 100.0
Total loans, net of unearned income 0.4% 0.1% 0.2% 0.5% 98.8% 100.0%
  1. 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%
  1. 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 - commercial10,612 6,940 6,558 7,799 7,028
Premium finance receivables - life insurance— — 168 — —
Consumer and other53 172 218 109 233
Total loans past due greater than 90 days and still accruing10,665 7,600 6,974 7,908 12,383
Non-accrual loans (2):
Commercial43,931 47,604 55,792 50,984 58,587
Commercial real estate21,557 20,875 15,933 19,129 17,515
Home equity7,920 8,489 7,885 7,147 8,523
Residential real estate13,447 14,236 15,879 16,383 16,062
Premium finance receivables - commercial15,950 13,833 14,797 11,335 13,802
Premium finance receivables - life insurance590 590 — — —
Consumer and other224 220 326 348 355
Total non-accrual loans103,619 105,847 110,612 105,326 114,844
Total non-performing loans:
Commercial43,931 48,092 55,792 50,984 63,709
Commercial real estate21,557 20,875 15,933 19,129 17,515
Home equity7,920 8,489 7,885 7,147 8,523
Residential real estate13,447 14,236 15,909 16,383 16,062
Premium finance receivables - commercial26,562 20,773 21,355 19,134 20,830
Premium finance receivables - life insurance590 590 168 — —
Consumer and other277 392 544 457 588
Total non-performing loans$114,284 $113,447 $117,586 $113,234 $127,227
Other real estate owned8,584 9,920 9,154 11,968 14,924
Other real estate owned - from acquisitions8,898 9,917 12,366 12,852 13,379
Other repossessed assets257 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:
Commercial0.54% 0.58% 0.70% 0.65% 0.85%
Commercial real estate0.29 0.29 0.23 0.28 0.26
Home equity1.55 1.61 1.49 1.29 1.47
Residential real estate1.10 1.27 1.51 1.63 1.74
Premium finance receivables - commercial0.77 0.62 0.71 0.67 0.72
Premium finance receivables - life insurance0.01 0.01 0.00 — —
Consumer and other0.31 0.36 0.45 0.38 0.51
Total loans, net of unearned income0.44% 0.45% 0.49% 0.48% 0.55%
Total non-performing assets as a percentage of total assets0.38% 0.40% 0.43% 0.44% 0.52%
Allowance for loan losses as a percentage of total non-performing loans141.54% 141.41% 134.55% 134.92% 117.71%

  1. 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.
  2. 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 EndedNine Months Ended
Sep 30, Jun 30, Mar 31, Dec 31, Sep 30,Sep 30, Sep 30,
(Dollars in thousands)2019 2019 2019 2018 20182019 2018
Balance at beginning of period$113,447 $117,586 $113,234 $127,227 $83,282 $113,234 $90,162
Additions, net20,781 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
  1. 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 estate10,370 12,646 14,123 13,895 14,160
Residential real estate and other20,709 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 estate7,673 2,854 1,517 1,552 1,326
Residential real estate and other6,006 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 estate18,043 15,500 15,640 15,447 15,486
Residential real estate and other26,715 22,728 18,682 14,336 11,487
Total TDRs$66,308 $76,001 $88,362 $66,102 $66,219
  1. 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 sell3,008 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 development1,282 1,282 1,139 1,426 1,952
Commercial real estate14,950 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 management19,313 19,375 19,461 17,729 17,055 (62) — 2,258 13
Total wealth management23,999 24,139 23,977 22,726 22,634 (140) (1) 1,365 6
Mortgage banking50,864 37,411 18,158 24,182 42,014 13,453 36 8,850 21
Service charges on deposit accounts9,972 9,277 8,848 9,065 9,331 695 7 641 7
Gains (losses) on investment securities, net710 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), net11 (44) (171) (155) (61) 55 (125) 72 NM
Operating lease income, net12,025 11,733 10,796 10,882 9,132 292 2 2,893 32
Other:
Interest rate swap fees4,811 3,224 2,831 2,602 2,359 1,587 49 2,452 104
BOLI830 1,149 1,591 (466) 3,190 (319) (28) (2,360) NM
Administrative services1,086 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 leases6 — 5 3 11 6 NM (5) (45)
Miscellaneous10,878 8,640 10,980 8,381 9,156 2,238 26 1,722 19
Total Other17,556 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 EndedNine Months Ended
(Dollars in thousands)Sep 30,2019 Jun 30,2019 Mar 31,2019 Dec 31,2019 Sep 30,2018Sep 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 originations50,639 182,966 148,100 289,101 310,446 381,705 559,896
Veterans First originations456,005 301,324 164,762 175,483 199,774 922,091 518,726
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 investment154,897 106,237 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 sale48% 63% 67% 71% 76%57% 77%
Refinances as a percentage of originations for sale52 37 33 29 24 43 23
Total100% 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 capitalization14,029 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, net82 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 income5,989 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

  1. 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 compensation40,289 36,486 31,599 33,656 34,046 3,803 10 6,243 18
Benefits22,668 21,886 20,087 20,747 19,916 782 4 2,752 14
Total salaries and employee benefits141,024 133,732 125,723 122,111 123,855 7,292 5 17,169 14
Equipment13,314 12,759 11,770 11,523 10,827 555 4 2,487 23
Operating lease equipment depreciation8,907 8,768 8,319 8,462 7,370 139 2 1,537 21
Occupancy, net14,991 15,921 16,245 15,980 14,404 (930) (6) 587 4
Data processing6,522 6,204 7,525 8,447 9,335 318 5 (2,813) (30)
Advertising and marketing13,375 12,845 9,858 9,414 11,120 530 4 2,255 20
Professional fees8,037 6,228 5,556 9,259 9,914 1,809 29 (1,877) (19)
Amortization of other intangible assets2,928 2,957 2,942 1,407 1,163 (29) (1) 1,765 NM
FDIC insurance148 4,127 3,576 4,044 4,205 (3,979) (96) (4,057) (96)
OREO expense, net1,170 1,290 632 1,618 596 (120) NM 574 96
Other:
Commissions - 3rd party brokers734 749 718 779 1,059 (15) (2) (325) (31)
Postage2,321 2,606 2,450 2,047 2,205 (285) (11) 116 5
Miscellaneous21,083 21,421 19,060 16,242 17,584 (338) (2) 3,499 20
Total other24,138 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 2018Change 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 EndedNine 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 20182019 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:
- Loans978 1,031 1,034 980 941 3,043 2,423
- Liquidity Management Assets574 568 565 586 575 1,707 1,672
- Other Earning Assets5 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, net710 864 1,364 (2,649) 90 2,938 (249)
(H) Non-interest expense234,554 229,607 214,374 211,333 213,637 678,535 614,755
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 EndedNine 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 20182019 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 outstanding56,698 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 amortization2,928 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 amortization2,155 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:

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:

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 OfficerDavid A. Dykstra, Senior Executive Vice President & Chief Operating Officer(847) 939-9000Web site address: www.wintrust.com

Source: Wintrust Financial Corporation

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