WesBanco Inc.

10/26/2021 | Press release | Distributed by Public on 10/26/2021 14:43

WesBanco Announces Third Quarter 2021 Financial Results - Form 8-K

WesBanco Announces Third Quarter 2021 Financial Results

Wheeling, WV, October 26, 2021 - WesBanco, Inc. ("WesBanco") (Nasdaq: WSBC), a diversified, multi-state bank holding company, today announced net income and related earnings per share for the three and nine months ended September 30, 2021. Net income available to common shareholders for the period was $41.9 million, with diluted earnings per share of $0.64, compared to $41.3 million and $0.61 per diluted share, respectively, for the third quarter of 2020. For the nine months ended September 30, 2021, net income was $180.5 million, or $2.71 per diluted share, compared to $69.2 million, or $1.03 per diluted share, for the 2020 period. Net income available to common shareholders, excluding after-tax restructuring and merger-related expenses, for the three months ended September 30, 2021, was $45.4 million, or $0.70 per diluted share, as compared to $44.2 million and $0.66 per diluted share, respectively, in the prior year quarter (non-GAAP measures). On the same basis, net income for the nine months ended September 30, 2021 was $185.7 million, or $2.79 per diluted share, as compared to $76.5 million, or $1.14 per diluted share, in the prior year period (non-GAAP measures).

For the Three Months Ended September 30,

For the Nine Months Ended June 30,

2021

2020

2021

2020

(unaudited, dollars in thousands,

except per share amounts)

Net

Income

Diluted

Earnings

Per Share

Net

Income

Diluted

Earnings

Per Share

Net Income

Diluted

Earnings

Per Share

Net

Income

Diluted

Earnings

Per Share

Net income available to common shareholders (Non-GAAP)(1)

$

45,406

$

0.70

$

44,155

$

0.66

$

185,685

$

2.79

$

76,489

$

1.14

Less: After tax restructuring and merger-related expenses

(3,529

)

(0.06

)

(2,850

)

(0.05

)

(5,167

)

(0.08

)

(7,300

)

(0.11

)

Net income available to common shareholders (GAAP)

$

41,877

$

0.64

$

41,305

$

0.61

$

180,518

$

2.71

$

69,189

$

1.03

(1)

See non-GAAP financial measures for additional information relating to the calculation of these items.

Financial and operational highlights during the quarter ended September 30, 2021:

•

Pre-tax, pre-provision income ("PTPP") excluding restructuring and merger-related expenses (non-GAAP measure) was $57.8 million, which included $2.6 million of settlement costs with respect to the pending resolution of a lawsuit

•

Continued expense management demonstrated by a year-to-date efficiency ratio of 57.04% (non-GAAP measure)

•

Deposit growth, excluding certificates of deposit ("CDs"), was 15.0% year-over-year, driven by growth in demand deposits

•

Improving macro-economic forecasts favorably impacted the provision for credit losses under the Current Expected Credit Losses ("CECL") methodology, which drove both the net benefit in the provision for credit losses and the reduction in allowance for credit losses during the quarter

•

Key credit quality metrics such as non-performing assets, past due loans, and net loan charge-offs, as percentages of total portfolio loans, have remained at low levels and favorable to peer bank averages, those with total assets between $10 billion and $25 billion (based upon the prior four quarters)

•

During the quarter, we purchased approximately 2.1 million shares of our common stock on the open market under existing share repurchase authorizations

•

WesBanco Bank was named, for the second consecutive year, to Newsweek magazine's ranking of America's Best Banks, recognizing those banks that best serve their customers' needs, as well as being named the Best Big Bank in the state of West Virginia

•

Our core banking software system conversion was completed on August 2, which, among other benefits, provides enhanced digital capabilities

"We are pleased with WesBanco's performance during the third quarter of 2021 as we continue to deliver solid pre-tax, pre-provision earnings and manage discretionary expenses," said Todd F. Clossin, President and Chief Executive Officer of WesBanco. "We remain focused on ensuring a strong organization for our shareholders and will continue to appropriately return capital to them. In addition, we continue to make strategic hires across our organization and markets to enhance our ability to leverage growth opportunities once they fully return."

Mr. Clossin added, "I remain proud of our entire organization as it has remained diligently focused on serving the financial needs of our customers and communities throughout the pandemic, the re-opening of our economies, and through the completion of our core banking software system conversion. For the second year in a row, we have been named to Newsweek magazine's ranking of America's Best Banks which recognizes those institutions that best serve their customers' needs. I would also like to congratulate our Community

Development team for their being nationally honored with the ABA Foundation Community Commitment Award for their strong performance and outreach with our New Markets Loan Program."

Balance Sheet

Portfolio loans of $9.9 billion as of September 30, 2021 decreased 9.8% when compared to the prior year period, due primarily to forgiveness of approximately 8,140 SBA Payroll Protection Program ("SBA PPP") loans totaling $940 million and a high level of commercial real estate loan payoffs of $260 million during the third quarter of 2021. This higher level of payoffs negatively impacted total loan growth by approximately two percentage points. Further, when excluding SBA PPP loans, total loans decreased 4.9% year-over-year and 1.8% sequentially. As of September 30, approximately 3,190 SBA PPP loans for $272 million remained in the loan portfolio.

Total deposits increased 10.0% year-over-year to $13.4 billion due primarily to stimulus funds previously received by our customers and increased personal savings, which more than offset a $353.3 million reduction in CDs. Deposits, excluding CDs, increased 15.0% year-over-year, driven by a 16.5% increase in total demand deposits, which represent approximately 58% of total deposits.

Credit Quality

As of September 30, 2021, total loans past due, non-performing loans, and non-performing assets as percentages of the portfolio and total assets have remained relatively low and consistent throughout the last five quarters. In addition, for the third quarter, we realized net loan charge-offs to average loans of three basis points, on an annualized basis. The allowance for credit losses specific to total portfolio loans at September 30, 2021 was $136.6 million, or 1.38% of total loans; or, when excluding SBA PPP loans, 1.42% of total portfolio loans. The improvements in the macroeconomic forecasts and certain qualitative factors resulted in a negative provision for credit losses of $1.7 million for the third quarter of 2021, and a negative provision of $50.7 million for the year-to-date period.

Net Interest Margin and Income

The net interest margin of 3.08% for the third quarter of 2021 decreased 4 basis points sequentially and 23 basis points from the third quarter of 2020, primarily due to the lower interest rate environment, and a shift to a higher level of securities as a percentage of total assets. As a result of increased cash balances from our customers' higher personal savings creating extra liquidity, investment securities increased by $1.1 billion year-over-year and, as of September 30, 2021, represented approximately 23% of total assets. Reflecting the continued low interest rate environment, we remain focused on controlling the costs of our various funding sources. We have reduced all posted deposit rates, including certificates of deposit, throughout the past year, which helped to lower deposit funding costs 12 basis points year-over-year to 14 basis points for the third quarter of 2021, or 9 basis points when including non-interest bearing deposits. Furthermore, we continued to reduce our average FHLB borrowings to $0.3 billion, down 71.3% from the prior year, which lowered the cost of these borrowings by 53 basis points year-over-year. Accretion from acquisitions benefited the third quarter net interest margin by 10 basis points, as compared to 18 basis points in the prior year period. Lastly, the forgiveness of existing and funding of new SBA PPP loans benefited the third quarter of 2021 net interest margin by a net 14 basis points, as compared to a net 2 basis points in the prior year period.

Net interest income decreased $5.3 million, or 4.4%, during the third quarter of 2021, as compared to the same quarter of 2020, reflecting lower loan yields due to repricing of existing loans and lower new offered rates in the current market environment, lower accretion from purchase accounting, and lower rates on new investment securities purchased, partially offset by lower interest paid on deposits and borrowings as described above. For the nine months ended September 30, 2021, net interest income decreased $12.2 million, or 3.4%, due to the reasons discussed for the three-month period comparison.

Non-Interest Income

For the third quarter of 2021, non-interest income of $32.8 million decreased $1.9 million, or 5.4%, from the third quarter of 2020, driven primarily by lower mortgage banking income, which decreased $3.9 million, or 46.2%, from the record level recorded in the prior year period. While residential mortgage originations of $382 million continued to be strong during the quarter, as compared to $394 million last year, the amount sold in the secondary market decreased from 75% last year to approximately 40%, as we continued efforts to keep more 1-to-4 family residential mortgages on the balance sheet. Trust fees increased $0.9 million, or 13.4%, primarily from net organic growth during the quarter. Electronic banking fees increased $0.6 million, or 13.5%, as we transitioned to adjusted settlement processes of a new third-party digital banking service provider. Lastly, other income decreased $1.0 million, or 19.4%, due to lower loan swap-related income and the sale of the debit card sponsorship business earlier this year.

Non-interest income, for the nine months ended September 30, 2021, increased $6.6 million, or 6.9%. The net gain on other real estate owned and other assets of $5.0 million was primarily due to a gain earned during the second quarter on an investment made by WesBanco's Community Development Corporation in a start-up firm more than ten years ago that was recently acquired by a public company. In addition, mortgage banking fees decreased $0.6 million, or 3.7%, compared to the prior year period, net of year-to-date fair value loss adjustments of $1.0 million, while service charges on deposits were lower due to higher consumer deposits associated with the three rounds of stimulus to-date and lower general consumer spending, resulting in fewer eligible account fees.

Non-Interest Expense

Total operating expenses continued to be well-controlled through company-wide efforts to effectively manage discretionary costs and full-time equivalent employee counts, as demonstrated by a year-to-date efficiency ratio of 57.04%. Excluding restructuring and merger-related expenses, non-interest expense for the three months ended September 30, 2021 increased $3.9 million, or 4.5%, to $90.2 million compared to the prior year period, primarily due to $2.6 million of settlement costs with respect to the pending resolution of a lawsuit, included within other operating expenses, and higher salary expense. Salaries and wages increased $1.2 million, or 3.0%, due to higher incentive compensation expense of $1.8 million, reflecting increased business growth and financial performance as compared to the pandemic-impacted prior year, which more than offset lower year-over-year salary expense of approximately $0.9 million. In addition, employee benefits for the third quarter of $10.7 million, as compared to $10.6 million last year, included an additional $1.4 million from higher employee health insurance claims offset by lower pension and deferred compensation expenses. Equipment and software expense for the third quarter of 2021 increased $1.4 million, or 22.2%, year-over-year due to increased asset size, increased usage of digital banking services, and SBA PPP loan forgiveness. Lastly, FDIC insurance expense decreased $0.7 million, or 37.0%, year-over-year due to improved risk factors.

On a similar basis, non-interest expense during the first nine months of 2021 increased just $0.8 million, or 0.3%, compared to the prior year period. The primary drivers of this slight increase were higher equipment and software costs and legal settlement costs mentioned above and higher marketing expense from product advertising and brand awareness campaigns that were delayed from 2020 due to the COVID-19 pandemic. The increases were mostly offset by lower FDIC insurance from a refund received last quarter and improved risk factors, lower salaries and wages from financial center closures during the past year, and lower amortization of intangible asset expense.

Capital

WesBanco continues to maintain what we believe are strong regulatory capital ratios, as both consolidated and bank-level regulatory capital ratios are well above the applicable "well-capitalized" standards promulgated by bank regulators and the BASEL III capital standards. At September 30, 2021, Tier I leverage was 10.10%, Tier I risk-based capital ratio was 14.18%, common equity Tier 1 capital ratio ("CET 1") was 12.91%, and total risk-based capital was 16.38%.

During the third quarter of 2021, WesBanco repurchased 2,138,515 shares of its outstanding common stock on the open market at a total cost of $71.3 million. As of September 30, 2021, approximately 2.96 million shares remained for repurchase under the existing share repurchase authorization that was approved on August 26, 2021, by WesBanco's Board of Directors.

Conference Call and Webcast

WesBanco will host a conference call to discuss the Company's financial results for the third quarter of 2021 at 10:00 a.m. ET on Wednesday, October 27, 2021. Interested parties can access the live webcast of the conference call through the Investor Relations section of the Company's website, www.wesbanco.com. Participants can also listen to the conference call by dialing 888-347-6607, 855-669-9657 for Canadian callers, or 412-902-4290 for international callers, and asking to be joined into the WesBanco call.

A replay of the conference call will be available by dialing 877-344-7529, 855-669-9658 for Canadian callers, or 412-317-0088 for international callers, and providing the access code of 10150984. The replay will begin at approximately 12:00 p.m. ET on October 27, and end at 12 a.m. ET on November 10. An archive of the webcast will be available for one year on the Investor Relations section of the Company's website (www.wesbanco.com).

Forward-Looking Statements

Forward-looking statements in this report relating to WesBanco's plans, strategies, objectives, expectations, intentions and adequacy of resources, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The information contained in this report should be read in conjunction with WesBanco's Form 10-K for the year ended December 31, 2020 and documents subsequently filed by WesBanco with the Securities and Exchange Commission ("SEC"), including WesBanco's Form 10-Q for the quarters ended March 31, 2021 and June 30, 2021, which are available at the SEC's website, www.sec.gov or at WesBanco's website, www.WesBanco.com. Investors are cautioned that forward-looking statements, which are not historical fact, involve risks and uncertainties, including those detailed in WesBanco's most recent Annual Report on Form 10-K filed with the SEC under "Risk Factors" in Part I, Item 1A. Such statements are subject to important factors that could cause actual results to differ materially from those contemplated by such statements, including, without limitation, the effects of changing regional and national economic conditions including the effects of the COVID-19 pandemic; changes in interest rates, spreads on earning assets and interest-bearing liabilities, and associated interest rate sensitivity; sources of liquidity available to WesBanco and its related subsidiary operations; potential future credit losses and the credit risk of commercial, real estate, and consumer loan customers and their borrowing activities; actions of the Federal Reserve Board, the Federal Deposit Insurance Corporation, the SEC, the Financial Institution Regulatory Authority, the Municipal Securities Rulemaking Board, the Securities Investors Protection Corporation, and other regulatory bodies; potential legislative and federal and state regulatory actions and reform, including, without limitation, the impact of the implementation of the Dodd-Frank Act; adverse decisions of federal and state courts; fraud, scams and schemes of third parties; cyber-security breaches; competitive conditions in the financial services industry; rapidly changing technology affecting financial services; marketability of debt instruments and corresponding impact on fair value adjustments; and/or other external developments materially impacting WesBanco's operational and financial performance. WesBanco does not assume any duty to update forward-looking statements.

Non-GAAP Financial Measures

In addition to the results of operations presented in accordance with Generally Accepted Accounting Principles (GAAP), WesBanco's management uses, and this presentation contains or references, certain non-GAAP financial measures, such as pre-tax pre-provision income, tangible common equity/tangible assets; net income excluding after-tax restructuring and merger-related expenses; efficiency ratio; return on average assets; and return on average tangible equity. WesBanco believes these financial measures provide information useful to investors in understanding our operational performance and business and performance trends which facilitate comparisons with the performance of others in the financial services industry. Although WesBanco believes that these non-GAAP financial measures enhance investors' understanding of WesBanco's business and performance, these non-GAAP financial measures should not be considered an alternative to GAAP. The non-GAAP financial measures contained therein should be read in conjunction with the audited financial statements and analysis as presented in the Annual Report on Form 10-K as well as the unaudited financial statements and analyses as presented in the Quarterly Reports on Forms 10-Q for WesBanco and its subsidiaries, as well as other filings that the company has made with the SEC.

About WesBanco, Inc.

Founded in 1870, WesBanco, Inc. (www.wesbanco.com) is a diversified and balanced financial services company that delivers large bank capabilities with a community bank feel. Our distinct long-term growth strategies are built upon unique sustainable advantages permitting us to span six states with meaningful market share. Built upon our 'Better Banking Pledge', our customer-centric service culture is focused on growing long-term relationships by pledging to serve all personal and business customer needs efficiently and effectively. In addition to a full range of online and mobile banking options and a full-suite of commercial products and services, WesBanco provides trust, wealth management, securities brokerage, and private banking services through our century-old Trust and Investment Services department, with approximately $5.5 billion of assets under management (as of September 30, 2021). WesBanco's banking subsidiary, WesBanco Bank, Inc., operates 206 financial centers in the states of Indiana, Kentucky, Maryland, Ohio, Pennsylvania, and West Virginia. Additionally, WesBanco operates an insurance agency, WesBanco Insurance Services, Inc., and a full service broker/dealer, WesBanco Securities, Inc.

SOURCE: WesBanco, Inc.

WesBanco Company Contact:

John H. Iannone

Senior Vice President, Investor and Public Relations

304-905-7021

###

WESBANCO, INC.

Consolidated Selected Financial Highlights

(unaudited, dollars in thousands, except shares and per share amounts)

For the Three Months Ended

For the Nine Months Ended

STATEMENT OF INCOME

September 30,

September 30,

2021

2020

% Change

2021

2020

% Change

Interest and dividend income

Loans, including fees

$

103,206

$

116,524

(11.4

)

$

318,532

$

351,095

(9.3

)

Interest and dividends on securities:

Taxable

13,481

11,669

15.5

37,467

42,702

(12.3

)

Tax-exempt

4,063

4,182

(2.8

)

11,925

12,940

(7.8

)

Total interest and dividends on securities

17,544

15,851

10.7

49,392

55,642

(11.2

)

Other interest income

628

1,282

(51.0

)

1,836

4,062

(54.8

)

Total interest and dividend income

121,378

133,657

(9.2

)

369,760

410,799

(10.0

)

Interest expense

Interest bearing demand deposits

815

1,225

(33.5

)

2,859

5,970

(52.1

)

Money market deposits

350

707

(50.5

)

1,488

3,937

(62.2

)

Savings deposits

244

303

(19.5

)

769

1,523

(49.5

)

Certificates of deposit

1,726

3,197

(46.0

)

6,122

10,765

(43.1

)

Total interest expense on deposits

3,135

5,432

(42.3

)

11,238

22,195

(49.4

)

Federal Home Loan Bank borrowings

1,192

5,457

(78.2

)

5,387

20,982

(74.3

)

Other short-term borrowings

33

304

(89.1

)

192

1,454

(86.8

)

Subordinated debt and junior subordinated debt

1,743

1,871

(6.8

)

5,336

6,400

(16.6

)

Total interest expense

6,103

13,064

(53.3

)

22,153

51,031

(56.6

)

Net interest income

115,275

120,593

(4.4

)

347,607

359,768

(3.4

)

Provision for credit losses

(1,730

)

16,288

(110.6

)

(50,714

)

107,949

(147.0

)

Net interest income after provision for credit losses

117,005

104,305

12.2

398,321

251,819

58.2

Non-interest income

Trust fees

7,289

6,426

13.4

22,069

19,580

12.7

Service charges on deposits

6,050

5,332

13.5

15,820

16,272

(2.8

)

Electronic banking fees

5,427

4,780

13.5

14,853

13,100

13.4

Net securities brokerage revenue

1,965

1,725

13.9

5,318

4,787

11.1

Bank-owned life insurance

2,656

2,088

27.2

6,072

5,609

8.3

Mortgage banking income

4,563

8,488

(46.2

)

16,656

17,295

(3.7

)

Net securities (losses) gains

(15

)

787

(101.9

)

740

3,577

(79.3

)

Net gain (loss) on other real estate owned and other assets

785

(19

)

NM

4,974

84

NM

Other income

4,035

5,005

(19.4

)

15,574

15,177

2.6

Total non-interest income

32,755

34,612

(5.4

)

102,076

95,481

6.9

Non-interest expense

Salaries and wages

39,497

38,342

3.0

113,822

114,025

(0.2

)

Employee benefits

10,658

10,604

0.5

30,191

31,115

(3.0

)

Net occupancy

6,825

7,092

(3.8

)

20,430

20,809

(1.8

)

Equipment and software

7,609

6,229

22.2

21,654

17,991

20.4

Marketing

1,848

1,577

17.2

6,033

4,282

40.9

FDIC insurance

1,227

1,948

(37.0

)

2,690

6,456

(58.3

)

Amortization of intangible assets

2,854

3,346

(14.7

)

8,622

10,085

(14.5

)

Restructuring and merger-related expense

4,467

3,608

23.8

6,540

9,241

(29.2

)

Other operating expenses

19,716

17,197

14.6

54,858

52,775

3.9

Total non-interest expense

94,701

89,943

5.3

264,840

266,779

(0.7

)

Income before provision for income taxes

55,059

48,974

12.4

235,557

80,521

192.5

Provision for income taxes

10,651

7,669

38.9

47,445

11,332

318.7

Net Income

44,408

41,305

7.5

188,112

69,189

171.9

Preferred stock dividends

2,531

-

100.0

7,594

-

100.0

Net income available to common shareholders

$

41,877

$

41,305

1.4

$

180,518

$

69,189

160.9

Taxable equivalent net interest income

$

116,355

$

121,705

(4.4

)

$

350,777

$

363,208

(3.4

)

Per common share data

Net income per common share - basic

$

0.64

$

0.61

4.9

$

2.72

$

1.03

164.1

Net income per common share - diluted

0.64

0.61

4.9

2.71

1.03

163.1

Net income per common share - diluted, excluding certain items (1)(2)

0.70

0.66

6.1

2.79

1.14

144.7

Dividends declared

0.33

0.32

3.1

0.99

0.96

3.1

Book value (period end)

40.41

40.66

(0.6

)

40.41

40.66

(0.6

)

Tangible book value (period end) (1)

22.51

21.39

5.2

22.51

21.39

5.2

Average common shares outstanding - basic

64,931,764

67,214,759

(3.4

)

66,354,750

67,268,449

(1.4

)

Average common shares outstanding - diluted

65,065,848

67,269,303

(3.3

)

66,510,357

67,351,857

(1.2

)

Period end common shares outstanding

63,838,549

67,216,012

(5.0

)

63,838,549

67,216,012

(5.0

)

Period end preferred shares outstanding

150,000

150,000

-

150,000

150,000

-

(1) See non-GAAP financial measures for additional information relating to the calculation of this item.

(2) Certain items excluded from the calculation consist of after-tax restructuring and merger-related expenses.

NM - Not Meaningful

WESBANCO, INC.

Consolidated Selected Financial Highlights

(unaudited, dollars in thousands)

Selected ratios

For the Nine Months Ended

September 30,

2021

2020

% Change

Return on average assets

1.43

%

0.56

%

155.36

%

Return on average assets, excluding

after-tax restructuring and merger-related expenses (1)

1.47

0.62

137.10

Return on average equity

8.67

3.53

145.61

Return on average equity, excluding

after-tax restructuring and merger-related expenses (1)

8.92

3.90

128.72

Return on average tangible equity (1)

15.30

6.96

119.83

Return on average tangible equity, excluding

after-tax restructuring and merger-related expenses (1)

15.72

7.62

106.30

Return on average tangible common equity (1)

16.78

7.09

136.67

Return on average tangible common equity, excluding

after-tax restructuring and merger-related expenses (1)

17.25

7.76

122.29

Yield on earning assets (2)

3.36

3.86

(12.95

)

Cost of interest bearing liabilities

0.31

0.69

(55.07

)

Net interest spread (2)

3.05

3.17

(3.79

)

Net interest margin (2)

3.16

3.38

(6.51

)

Efficiency (1) (2)

57.04

56.15

1.59

Average loans to average deposits

80.01

92.37

(13.38

)

Annualized net loan charge-offs/average loans

0.01

0.08

(87.50

)

Effective income tax rate

20.14

14.07

43.14

For the Quarter Ended

Sept. 30,

June 30,

Mar. 31,

Dec. 31,

Sept. 30,

2021

2021

2021

2020

2020

Return on average assets

0.97

%

1.60

%

1.72

%

1.21

%

0.98

%

Return on average assets, excluding

after-tax restructuring and merger-related expenses (1)

1.06

1.62

1.74

1.22

1.05

Return on average equity

5.98

9.74

10.33

7.28

6.17

Return on average equity, excluding

after-tax restructuring and merger-related expenses (1)

6.49

9.88

10.43

7.33

6.60

Return on average tangible equity (1)

10.72

17.04

18.22

13.18

11.56

Return on average tangible equity, excluding

after-tax restructuring and merger-related expenses (1)

11.57

17.27

18.39

13.28

12.31

Return on average tangible common equity (1)

11.76

18.67

20.00

14.49

12.21

Return on average tangible common equity, excluding

after-tax restructuring and merger-related expenses (1)

12.70

18.92

20.18

14.60

13.00

Yield on earning assets (2)

3.24

3.32

3.51

3.61

3.66

Cost of interest bearing liabilities

0.25

0.31

0.37

0.45

0.53

Net interest spread (2)

2.99

3.01

3.14

3.16

3.13

Net interest margin (2)

3.08

3.12

3.27

3.31

3.31

Efficiency (1) (2)

60.52

53.97

56.71

57.06

55.23

Average loans to average deposits

75.46

79.82

85.27

89.64

90.88

Annualized net loan charge-offs and recoveries /average loans

0.03

(0.03

)

0.02

0.02

(0.00

)

Effective income tax rate

19.34

20.85

19.93

18.13

15.66

Trust assets, market value at period end

$

5,464,159

$

5,480,995

$

5,244,370

$

5,025,565

$

4,649,054

(1) See non-GAAP financial measures for additional information relating to the calculation of this item.

(2) The yield on earning assets, net interest margin, net interest spread and efficiency ratios are presented on a fully taxable-equivalent (FTE) and annualized basis. The FTE basis adjusts for the tax benefit of income on certain tax-exempt loans and investments. WesBanco believes this measure to be the preferred industry measurement of net interest income and provides a relevant comparison between taxable and non-taxable amounts.

WESBANCO, INC.

Consolidated Selected Financial Highlights

(unaudited, dollars in thousands, except shares and per share amounts)

% Change

September 30,

December 31,

December 31, 2020

Balance sheets

2021

2020

% Change

2020

to September 30, 2021

Assets

Cash and due from banks

$

201,505

$

215,982

(6.7

)

$

184,361

9.3

Due from banks - interest bearing

919,611

544,284

69.0

721,086

27.5

Securities:

Equity securities, at fair value

13,451

12,516

7.5

13,047

3.1

Available-for-sale debt securities, at fair value

2,986,803

2,045,924

46.0

1,978,136

51.0

Held-to-maturity debt securities (fair values of $978,494;

$782,401 and $768,183, respectively)

953,920

746,767

27.7

731,212

30.5

Allowance for credit losses, held-to-maturity debt securities

(257

)

(461

)

44.3

(326

)

21.2

Net held-to-maturity debt securities

953,663

746,306

27.8

730,886

30.5

Total securities

3,953,917

2,804,746

41.0

2,722,069

45.3

Loans held for sale

32,308

134,151

(75.9

)

168,378

(80.8

)

Portfolio loans:

Commercial real estate

5,657,886

5,708,648

(0.9

)

5,705,392

(0.8

)

Commercial and industrial

1,707,214

2,507,235

(31.9

)

2,407,438

(29.1

)

Residential real estate

1,655,229

1,798,019

(7.9

)

1,720,961

(3.8

)

Home equity

607,735

647,052

(6.1

)

646,387

(6.0

)

Consumer

285,101

328,592

(13.2

)

309,055

(7.8

)

Total portfolio loans, net of unearned income

9,913,165

10,989,546

(9.8

)

10,789,233

(8.1

)

Allowance for credit losses - loans

(136,605

)

(185,109

)

26.2

(185,827

)

26.5

Net portfolio loans

9,776,560

10,804,437

(9.5

)

10,603,406

(7.8

)

Premises and equipment, net

232,134

248,491

(6.6

)

249,421

(6.9

)

Accrued interest receivable

61,895

65,023

(4.8

)

66,790

(7.3

)

Goodwill and other intangible assets, net

1,154,468

1,165,566

(1.0

)

1,163,091

(0.7

)

Bank-owned life insurance

349,735

304,288

14.9

306,038

14.3

Other assets

209,978

265,172

(20.8

)

240,970

(12.9

)

Total Assets

$

16,892,111

$

16,552,140

2.1

$

16,425,610

2.8

Liabilities

Deposits:

Non-interest bearing demand

$

4,531,958

$

4,073,305

11.3

$

4,070,835

11.3

Interest bearing demand

3,283,444

2,633,601

24.7

2,839,536

15.6

Money market

1,765,480

1,619,410

9.0

1,685,927

4.7

Savings deposits

2,488,180

2,167,597

14.8

2,214,565

12.4

Certificates of deposit

1,354,252

1,707,512

(20.7

)

1,618,510

(16.3

)

Total deposits

13,423,314

12,201,425

10.0

12,429,373

8.0

Federal Home Loan Bank borrowings

208,940

794,621

(73.7

)

549,003

(61.9

)

Other short-term borrowings

152,546

381,909

(60.1

)

241,950

(37.0

)

Subordinated debt and junior subordinated debt

167,711

192,150

(12.7

)

192,291

(12.8

)

Total borrowings

529,197

1,368,680

(61.3

)

983,244

(46.2

)

Accrued interest payable

2,495

5,014

(50.2

)

4,314

(42.2

)

Other liabilities

213,122

244,055

(12.7

)

251,942

(15.4

)

Total Liabilities

14,168,128

13,819,174

2.5

13,668,873

3.7

Shareholders' Equity

Preferred stock, no par value; 1,000,000 shares authorized in 2021 and 2020, respectively; 150,000 shares 6.75% non-cumulative perpetual preferred stock, Series A, liquidation preference $150.0 million, issued and outstanding in 2021 and 2020, respectively

144,484

144,529

(0.0

)

144,484

-

Common stock, $2.0833 par value; 100,000,000 shares authorized in 2021 and 2020, respectively; 68,081,306, 68,081,306 and 68,081,306 shares issued, respectively; 63,838,549, 67,216,012 and 67,254,706 shares outstanding, respectively

141,834

141,834

-

141,834

-

Capital surplus

1,634,086

1,634,172

(0.0

)

1,634,815

(0.0

)

Retained earnings

946,746

802,892

17.9

831,688

13.8

Treasury stock (4,242,757, 865,294 and 826,600 shares - at cost, respectively)

(146,102

)

(27,403

)

(433.2

)

(25,949

)

(463.0

)

Accumulated other comprehensive income

4,463

38,301

(88.3

)

31,359

(85.8

)

Deferred benefits for directors

(1,528

)

(1,359

)

(12.4

)

(1,494

)

(2.3

)

Total Shareholders' Equity

2,723,983

2,732,966

(0.3

)

2,756,737

(1.2

)

Total Liabilities and Shareholders' Equity

$

16,892,111

$

16,552,140

2.1

$

16,425,610

2.8

WESBANCO, INC.

Consolidated Selected Financial Highlights

(unaudited, dollars in thousands)

September 30,

June 30,

Balance sheets

2021

2021

% Change

Assets

Cash and due from banks

$

201,505

$

208,992

(3.6

)

Due from banks - interest bearing

919,611

637,312

44.3

Securities:

Equity securities, at fair value

13,451

13,494

(0.3

)

Available-for-sale debt securities, at fair value

2,986,803

2,964,264

0.8

Held-to-maturity debt securities (fair values of $978,494 and $934,487, respectively)

953,920

902,172

5.7

Allowance for credit losses, held-to-maturity debt securities

(257

)

(227

)

(13.2

)

Net held-to-maturity debt securities

953,663

901,945

5.7

Total securities

3,953,917

3,879,703

1.9

Loans held for sale

32,308

41,461

(22.1

)

Portfolio loans:

Commercial real estate

5,657,886

5,705,246

(0.8

)

Commercial and industrial

1,707,214

2,119,186

(19.4

)

Residential real estate

1,655,229

1,625,632

1.8

Home equity

607,735

631,059

(3.7

)

Consumer

285,101

276,069

3.3

Total portfolio loans, net of unearned income

9,913,165

10,357,192

(4.3

)

Allowance for credit losses - loans

(136,605

)

(140,730

)

2.9

Net portfolio loans

9,776,560

10,216,462

(4.3

)

Premises and equipment, net

232,134

235,227

(1.3

)

Accrued interest receivable

61,895

64,020

(3.3

)

Goodwill and other intangible assets, net

1,154,468

1,157,322

(0.2

)

Bank-owned life insurance

349,735

309,454

13.0

Other assets

209,978

216,914

(3.2

)

Total Assets

$

16,892,111

$

16,966,867

(0.4

)

Liabilities

Deposits:

Non-interest bearing demand

$

4,531,958

$

4,409,221

2.8

Interest bearing demand

3,283,444

3,214,484

2.1

Money market

1,765,480

1,771,686

(0.4

)

Savings deposits

2,488,180

2,438,328

2.0

Certificates of deposit

1,354,252

1,484,536

(8.8

)

Total deposits

13,423,314

13,318,255

0.8

Federal Home Loan Bank borrowings

208,940

313,960

(33.5

)

Other short-term borrowings

152,546

135,267

12.8

Subordinated debt and junior subordinated debt

167,711

192,571

(12.9

)

Total borrowings

529,197

641,798

(17.5

)

Accrued interest payable

2,495

3,342

(25.3

)

Other liabilities

213,122

222,636

(4.3

)

Total Liabilities

14,168,128

14,186,031

(0.1

)

Shareholders' Equity

Preferred stock, no par value; 1,000,000 shares authorized; 150,000 shares 6.75% non-cumulative perpetual preferred stock, Series A, liquidation preference $150.0 million, issued and outstanding at September 30, 2021 and June 30, 2021, respectively

144,484

144,484

-

Common stock, $2.0833 par value; 100,000,000 shares authorized; 68,081,306 and 68,081,306 shares issued, respectively; 63,838,549 and 65,970,149 shares outstanding, respectively

141,834

141,834

-

Capital surplus

1,634,086

1,632,460

0.1

Retained earnings

946,746

925,977

2.2

Treasury stock (4,242,757 and 2,111,157 shares - at cost)

(146,102

)

(74,996

)

(94.8

)

Accumulated other comprehensive income

4,463

12,586

(64.5

)

Deferred benefits for directors

(1,528

)

(1,509

)

(1.3

)

Total Shareholders' Equity

2,723,983

2,780,836

(2.0

)

Total Liabilities and Shareholders' Equity

$

16,892,111

$

16,966,867

(0.4

)

WESBANCO, INC.

Consolidated Selected Financial Highlights

(unaudited, dollars in thousands)

For the Three Months Ended September 30,

For the Nine Months Ended September 30,

2021

2020

2021

2020

Average balance sheet and net interest margin analysis

Average

Average

Average

Average

Average

Average

Average

Average

Balance

Rate

Balance

Rate

Balance

Rate

Balance

Rate

Assets

Due from banks - interest bearing

$

936,084

0.16

%

$

755,575

0.16

%

$

803,713

0.12

%

$

509,928

0.25

%

Loans, net of unearned income (1)

10,164,279

4.03

11,107,106

4.17

10,562,879

4.03

10,813,737

4.34

Securities: (2)

Taxable

3,210,878

1.67

2,121,780

2.19

2,856,041

1.75

2,328,196

2.45

Tax-exempt (3)

650,397

3.14

603,835

3.49

610,449

3.31

624,278

3.50

Total securities

3,861,275

1.91

2,725,615

2.47

3,466,490

2.03

2,952,474

2.67

Other earning assets

23,646

4.23

56,575

6.88

28,494

5.11

65,849

6.27

Total earning assets (3)

14,985,284

3.24

%

14,644,871

3.66

%

14,861,576

3.36

%

14,341,988

3.86

%

Other assets

2,072,509

2,074,846

2,060,312

2,065,777

Total Assets

$

17,057,793

$

16,719,717

$

16,921,888

$

16,407,765

Liabilities and Shareholders' Equity

Interest bearing demand deposits

$

3,297,702

0.10

%

$

2,654,161

0.18

%

$

3,139,992

0.12

%

$

2,518,952

0.32

%

Money market accounts

1,791,494

0.08

1,623,969

0.17

1,764,462

0.11

1,590,498

0.33

Savings deposits

2,471,593

0.04

2,140,932

0.06

2,393,066

0.04

2,051,930

0.10

Certificates of deposit

1,403,812

0.49

1,761,087

0.72

1,501,857

0.54

1,865,439

0.77

Total interest bearing deposits

8,964,601

0.14

8,180,149

0.26

8,799,377

0.17

8,026,819

0.37

Federal Home Loan Bank borrowings

289,334

1.63

1,006,593

2.16

388,518

1.85

1,285,266

2.18

Other borrowings

136,028

0.10

383,771

0.32

152,450

0.17

361,949

0.54

Subordinated debt and junior subordinated debt

188,276

3.67

192,093

3.87

191,018

3.73

194,195

4.40

Total interest bearing liabilities (4)

9,578,239

0.25

%

9,762,606

0.53

%

9,531,363

0.31

%

9,868,229

0.69

%

Non-interest bearing demand deposits

4,504,332

4,041,681

4,402,487

3,679,743

Other liabilities

197,916

252,917

205,309

239,797

Shareholders' equity

2,777,306

2,662,513

2,782,729

2,619,996

Total Liabilities and Shareholders' Equity

$

17,057,793

$

16,719,717

$

16,921,888

$

16,407,765

Taxable equivalent net interest spread

2.99

%

3.13

%

3.05

%

3.17

%

Taxable equivalent net interest margin

3.08

%

3.31

%

3.16

%

3.38

%

(1) Gross of allowance for loan losses and net of unearned income, Includes non-accrual and loans held for sale. Loan fees included in interest income on loans were $6.8 million and $6.2 million for the three months ended September 30, 2021 and 2020, respectively and were $21.5 million and $9.5 million for the nine months ended September 30, 2021 and 2020, respectively. As part of loan fees, PPP loan fees were $7.1 million and $5.6 million for the three months ended September 30, 2021 and 2020, respectively, and were $21.0 million and $7.7 million for the nine months ended September 30, 2021 and 2020, respectively. Additionally, loan accretion included in interest income on loans acquired from prior acquisitions was $3.0 million and $4.2 million for the three months ended September 30, 2021 and 2020, respectively, and was $10.3 million and $12.5 million for the nine months ended September 30, 2021 and 2020, respectively.

(2) Average yields on available-for-sale securities are calculated based on amortized cost.

(3) Taxable equivalent basis is calculated on tax-exempt securities using a rate of 21% for each period presented.

(4) Accretion on interest bearing liabilities acquired from prior acquisitions was $0.7 million and $2.1 million for the three months ended September 30, 2021 and 2020, respectively, and $2.6 million and $8.1 million for the nine months ended September 30, 2021 and 2020, respectively.

WESBANCO, INC.

Consolidated Selected Financial Highlights

(unaudited, dollars in thousands)

Quarter Ended

Sept. 30,

June 30,

Mar. 31,

Dec. 31,

Sept. 30,

Statement of Income

2021

2021

2021

2020

2020

Interest and dividend income

Loans, including fees

$

103,206

$

105,968

$

109,358

$

114,582

$

116,524

Interest and dividends on securities:

Taxable

13,481

12,900

11,127

10,892

11,669

Tax-exempt

4,063

3,952

3,910

4,059

4,182

Total interest and dividends on securities

17,544

16,852

15,037

14,951

15,851

Other interest income

628

507

659

945

1,282

Total interest and dividend income

121,378

123,327

125,054

130,478

133,657

Interest expense

Interest bearing demand deposits

815

1,009

1,043

1,099

1,225

Money market deposits

350

551

578

678

707

Savings deposits

244

261

264

280

303

Certificates of deposit

1,726

2,026

2,370

2,797

3,197

Total interest expense on deposits

3,135

3,847

4,255

4,854

5,432

Federal Home Loan Bank borrowings

1,192

1,781

2,414

3,719

5,457

Other short-term borrowings

33

40

118

275

304

Subordinated debt and junior subordinated debt

1,743

1,804

1,789

1,918

1,871

Total interest expense

6,103

7,472

8,576

10,766

13,064

Net interest income

115,275

115,855

116,478

119,712

120,593

Provision for credit losses

(1,730

)

(21,025

)

(27,958

)

(209

)

16,288

Net interest income after provision for credit losses

117,005

136,880

144,436

119,921

104,305

Non-interest income

Trust fees

7,289

7,148

7,631

6,754

6,426

Service charges on deposits

6,050

4,876

4,894

5,671

5,332

Electronic banking fees

5,427

5,060

4,365

4,424

4,780

Net securities brokerage revenue

1,965

1,829

1,524

1,402

1,725

Bank-owned life insurance

2,656

1,707

1,709

1,750

2,088

Mortgage banking income

4,563

7,830

4,264

5,442

8,488

Net securities (losses) gains

(15

)

477

279

691

787

Net gain / (loss) on other real estate owned and other assets

785

4,014

175

18

(19

)

Other income

4,035

3,171

8,367

6,553

5,005

Total non-interest income

32,755

36,112

33,208

32,705

34,612

Non-interest expense

Salaries and wages

39,497

37,435

36,890

39,140

38,342

Employee benefits

10,658

9,268

10,266

10,608

10,604

Net occupancy

6,825

6,427

7,177

6,771

7,092

Equipment and software

7,609

7,281

6,765

6,810

6,229

Marketing

1,848

1,802

2,384

1,675

1,577

FDIC insurance

1,227

181

1,282

1,278

1,948

Amortization of intangible assets

2,854

2,873

2,896

3,327

3,346

Restructuring and merger-related expense

4,467

1,222

851

484

3,608

Other operating expenses

19,716

17,323

17,816

17,976

17,198

Total non-interest expense

94,701

83,812

86,327

88,069

89,943

Income before provision for income taxes

55,059

89,180

91,317

64,557

48,974

Provision for income taxes

10,651

18,592

18,202

11,703

7,669

Net Income

44,408

70,588

73,115

52,854

41,305

Preferred stock dividends

2,531

2,531

2,531

2,644

-

Net income available to common shareholders

$

41,877

$

68,057

$

70,584

$

50,210

$

41,305

Taxable equivalent net interest income

$

116,355

$

116,906

$

117,517

$

120,790

$

121,705

Per common share data

Net income per common share - basic

$

0.64

$

1.02

$

1.05

$

0.75

$

0.61

Net income per common share - diluted

0.64

1.01

1.05

0.75

0.61

Net income per common share - diluted, excluding

certain items (1)(2)

0.70

1.03

1.06

0.76

0.66

Dividends declared

0.33

0.33

0.33

0.32

0.32

Book value (period end)

40.41

39.96

39.25

38.84

38.51

Tangible book value (period end) (1)

22.51

22.61

22.21

21.75

21.39

Average common shares outstanding - basic

64,931,764

66,894,398

67,263,714

67,238,005

67,214,759

Average common shares outstanding - diluted

65,065,848

67,066,592

67,335,418

67,304,442

67,269,303

Period end common shares outstanding

63,838,549

65,970,149

67,282,134

67,254,706

67,216,012

Period end preferred shares outstanding

150,000

150,000

150,000

150,000

150,000

Full time equivalent employees

2,425

2,459

2,490

2,612

2,618

(1) See non-GAAP financial measures for additional information relating to the calculation of this item.

(2) Certain items excluded from the calculation consist of after-tax restructuring and merger-related expenses.

WESBANCO, INC.

Consolidated Selected Financial Highlights

(unaudited, dollars in thousands)

Quarter Ended

Sept. 30,

June 30,

Mar. 31,

Dec. 31,

Sept. 30,

Asset quality data

2021

2021

2021

2020

2020

Non-performing assets:

Troubled debt restructurings - accruing

$

3,707

$

5,799

$

3,563

$

3,927

$

4,191

Non-accrual loans:

Troubled debt restructurings

1,615

1,664

1,768

1,828

1,818

Other non-accrual loans

34,644

34,548

32,807

35,052

35,448

Total non-accrual loans

36,259

36,212

34,575

36,880

37,266

Total non-performing loans

39,966

42,011

38,138

40,807

41,457

Other real estate and repossessed assets

293

773

393

549

738

Total non-performing assets

$

40,259

$

42,784

$

38,531

$

41,356

$

42,195

Past due loans (1):

Loans past due 30-89 days

$

32,682

$

21,233

$

20,602

$

31,596

$

17,338

Loans past due 90 days or more

11,252

8,318

12,824

8,846

10,170

Total past due loans

$

43,934

$

29,551

$

33,426

$

40,442

$

27,508

Criticized and classified loans (2):

Criticized loans

$

290,281

$

319,448

$

340,943

$

362,295

$

248,264

Classified loans

127,022

136,927

114,884

132,650

108,594

Total criticized and classified loans

$

417,303

$

456,375

$

455,827

$

494,945

$

356,858

Loans past due 30-89 days / total portfolio loans (3)

0.33

%

0.21

%

0.19

%

0.29

%

0.16

%

Loans past due 90 days or more / total portfolio loans

0.11

0.08

0.12

0.08

0.09

Non-performing loans / total portfolio loans

0.40

0.41

0.36

0.38

0.38

Non-performing assets/total portfolio loans, other

real estate and repossessed assets

0.41

0.41

0.36

0.38

0.38

Non-performing assets / total assets

0.24

0.25

0.23

0.25

0.26

Criticized and classified loans / total portfolio loans

4.21

4.41

4.26

4.59

3.25

Allowance for credit losses

Allowance for credit losses - loans

$

136,605

$

140,730

$

160,040

$

185,827

$

185,109

Allowance for credit losses - loan commitments

7,290

5,766

6,731

9,514

10,829

Provision for credit losses

(1,730

)

(21,025

)

(27,958

)

(209

)

16,288

Net loan and deposit account overdraft charge-offs and recoveries

842

(689

)

648

524

(133

)

Annualized net loan charge-offs and recoveries / average loans

0.03

%

(0.03

)

%

0.02

%

0.02

%

(0.00

)

%

Allowance for credit losses - loans / total portfolio loans

1.38

%

1.36

%

1.50

%

1.72

%

1.68

%

Allowance for credit losses - loans / total portfolio loans excluding PPP loans

1.42

%

1.43

%

1.62

%

1.85

%

1.83

%

Allowance for credit losses - loans / non-performing loans

3.42

x

3.35

x

4.20

x

4.55

x

4.47

x

Allowance for credit losses - loans / non-performing loans

and loans past due

1.63

x

1.97

x

2.24

x

2.29

x

2.68

x

Quarter Ended

Sept. 30,

June 30,

Mar. 31,

Dec. 31,

Sept. 30,

2021

2021

2021

2020

2020

Capital ratios

Tier I leverage capital

10.10

%

10.42

%

10.74

%

10.51

%

10.18

%

Tier I risk-based capital

14.18

15.15

14.95

14.72

14.29

Total risk-based capital

16.38

17.68

17.58

17.58

17.18

Common equity tier 1 capital ratio (CET 1)

12.91

13.83

13.65

13.40

12.99

Average shareholders' equity to average assets

16.44

16.44

16.65

16.59

15.92

Tangible equity to tangible assets (4)

10.04

10.34

10.30

10.52

10.27

Tangible common equity to tangible assets (4)

9.12

9.43

9.39

9.58

9.33

(1) Excludes non-performing loans.

(2) Criticized and classified commercial loans may include loans that are also reported as non-performing or past due.

(3) Total portfolio loans includes $272.1 million of PPP loans as of September 30, 2021.

(4) See non-GAAP financial measures for additional information relating to the calculation of this ratio.

WESBANCO, INC.

Consolidated Selected Financial Highlights

NON-GAAP FINANCIAL MEASURES

The following non-GAAP financial measures used by WesBanco provide information useful to investors in understanding WesBanco's operating performance and trends, and facilitate comparisons with the performance of WesBanco's peers. The following tables summarize the non-GAAP financial measures derived from amounts reported in WesBanco's financial statements.

Three Months Ended

Year to Date

Sept. 30,

June 30,

Mar. 31,

Dec. 31,

Sept. 30,

Sept. 30,

(unaudited, dollars in thousands, except shares and per share amounts)

2021

2021

2021

2020

2020

2021

2020

Return on average assets, excluding after-tax restructuring and merger-related expenses:

Net income available to common shareholders

$

41,877

$

68,057

$

70,584

$

50,210

$

41,305

$

180,518

$

69,189

Plus: after-tax restructuring and merger-related expenses (1)

3,529

965

672

383

2,850

5,167

7,300

Net income available to common shareholders excluding after-tax restructuring and merger-related expenses

45,406

69,022

71,256

50,593

44,155

185,685

76,489

Average total assets

$

17,042,147

$

17,042,147

$

16,636,258

$

16,546,761

$

16,719,717

$

16,840,324

$

16,407,765

Return on average assets, excluding after-tax restructuring and merger-related expenses (annualized) (2)

1.06

%

1.62

%

1.74

%

1.22

%

1.05

%

1.47

%

0.62

%

Return on average equity, excluding after-tax restructuring and merger-related expenses:

Net income available to common shareholders

$

41,877

$

68,057

$

70,584

$

50,210

$

41,305

$

180,518

$

69,189

Plus: after-tax restructuring and merger-related expenses (1)

3,529

965

672

383

2,850

5,167

7,300

Net income available to common shareholders excluding after-tax restructuring and merger-related expenses

45,406

69,022

71,256

50,593

44,155

185,685

76,489

Average total shareholders' equity

2,801,455

2,801,455

2,770,416

2,744,936

2,662,513

2,786,021

2,619,996

Return on average equity, excluding after-tax restructuring and merger-related expenses (annualized) (2)

6.43

%

9.88

%

10.43

%

7.33

%

6.60

%

8.91

%

3.90

%

Return on average tangible equity:

Net income available to common shareholders

$

41,877

$

68,057

$

70,584

$

50,210

$

41,305

$

180,518

$

69,189

Plus: amortization of intangibles (1)

2,255

2,270

2,288

2,628

2,643

6,811

7,967

Net income available to common shareholders before amortization of intangibles

44,132

70,327

72,872

52,838

43,948

187,329

77,156

Average total shareholders' equity

2,801,455

2,801,455

2,770,416

2,744,936

2,662,513

2,786,021

2,619,996

Less: average goodwill and other intangibles, net of def. tax liability

(1,143,522

)

(1,145,882

)

(1,148,171

)

(1,150,184

)

(1,150,549

)

(1,145,841

)

(1,138,621

)

Average tangible equity

$

1,657,933

$

1,655,573

$

1,622,245

$

1,594,752

$

1,511,964

$

1,640,180

$

1,481,375

Return on average tangible equity (annualized) (2)

10.56

%

17.04

%

18.22

%

13.18

%

11.56

%

15.27

%

6.96

%

Average tangible common equity

$

1,513,449

$

1,511,089

$

1,477,736

$

1,450,243

$

1,431,657

$

1,495,696

$

1,454,411

Return on average tangible common equity (annualized) (2)

11.57

%

18.67

%

20.00

%

14.49

%

12.21

%

16.75

%

7.09

%

Return on average tangible equity, excluding after-tax restructuring and merger-related expenses:

Net income available to common shareholders

$

41,877

$

68,057

$

70,584

$

50,210

$

41,305

$

180,518

$

69,189

Plus: after-tax restructuring and merger-related expenses (1)

3,529

965

672

383

2,850

5,167

7,300

Plus: amortization of intangibles (1)

2,255

2,270

2,288

2,628

2,643

6,811

7,967

Net income available to common shareholders before amortization of intangibles and

excluding after-tax restructuring and merger-related expenses

47,661

71,292

73,544

53,221

46,798

192,496

84,456

Average total shareholders' equity

2,801,455

2,801,455

2,770,416

2,744,936

2,662,513

2,786,021

2,619,996

Less: average goodwill and other intangibles, net of def. tax liability

(1,143,522

)

(1,145,882

)

(1,148,171

)

(1,150,184

)

(1,150,549

)

(1,145,841

)

(1,138,621

)

Average tangible equity

$

1,657,933

$

1,655,573

$

1,622,245

$

1,594,752

$

1,511,964

$

1,640,180

$

1,481,375

Return on average tangible equity, excluding after-tax restructuring and merger-related expenses (annualized) (2)

11.41

%

17.27

%

18.39

%

13.28

%

12.31

%

15.69

%

7.62

%

Average tangible common equity

$

1,513,449

$

1,511,089

$

1,477,736

$

1,450,243

$

1,431,657

$

1,495,696

$

1,454,411

Return on average tangible common equity, excluding after-tax restructuring and merger-related expenses (annualized) (2)

12.49

%

18.92

%

20.18

%

14.60

%

13.00

%

17.21

%

7.76

%

Three Months Ended

Year to Date

Sept. 30,

June 30,

Mar. 31,

Dec. 31,

Sept. 30,

Sept.30,

(unaudited, dollars in thousands, except shares and per share amounts)

2021

2021

2021

2020

2020

2021

2020

Efficiency ratio:

Non-interest expense

$

94,701

$

83,812

$

86,327

$

88,069

$

89,943

$

264,840

$

266,779

Less: restructuring and merger-related expense

(4,467

)

(1,222

)

(851

)

(484

)

(3,608

)

(6,540

)

(9,241

)

Non-interest expense excluding restructuring and merger-related expense

90,234

82,590

85,476

87,585

86,335

258,300

257,538

Net interest income on a fully taxable equivalent basis

116,355

116,906

117,517

120,790

121,705

350,777

363,208

Non-interest income

32,755

36,112

33,208

32,705

34,612

102,076

95,481

Net interest income on a fully taxable equivalent basis plus non-interest income

$

149,110

$

153,018

$

150,725

$

153,495

$

156,317

$

452,853

$

458,689

Efficiency Ratio

60.52

%

53.97

%

56.71

%

57.06

%

55.23

%

57.04

%

56.15

%

Net income available to common shareholders, excluding after-tax restructuring and merger-related expenses:

Net income available to common shareholders

$

41,877

$

68,057

$

70,584

$

50,210

$

41,305

$

180,518

$

69,189

Add: After-tax restructuring and merger-related expenses (1)

3,529

965

672

383

2,850

5,167

7,300

Net income available to common shareholders, excluding after-tax restructuring and merger-related expenses

$

45,406

$

69,022

$

71,256

$

50,593

$

44,155

$

185,685

$

76,489

Net income per common share - diluted, excluding after-tax restructuring and merger-related expenses:

Net income per common share - diluted

$

0.64

$

1.01

$

1.05

$

0.75

$

0.61

$

2.71

$

1.03

Add: After-tax restructuring and merger-related expenses per common share - diluted (1)

0.06

0.02

0.01

0.01

0.05

0.08

0.11

Net income per common share - diluted, excluding after-tax restructuring and merger-related expenses

$

0.70

$

1.03

$

1.06

$

0.76

$

0.66

$

2.79

$

1.14

Period End

Sept. 30,

June 30,

Mar. 31,

Dec. 31,

Sept. 30,

2021

2021

2021

2020

2020

Tangible book value per share:

Total shareholders' equity

$

2,723,983

$

2,780,836

$

2,785,522

$

2,756,737

$

2,732,966

Less: goodwill and other intangible assets, net of def. tax liability

(1,142,350

)

(1,144,604

)

(1,146,874

)

(1,149,161

)

(1,150,939

)

Less: preferred shareholders' equity

(144,484

)

(144,484

)

(144,484

)

(144,484

)

(144,529

)

Tangible common equity

1,437,149

1,491,748

1,494,164

1,463,092

1,437,498

Common shares outstanding

63,838,549

65,970,149

67,282,134

67,254,706

67,216,012

Tangible book value per share

$

22.51

$

22.61

$

22.21

$

21.75

$

21.39

Tangible common equity to tangible assets:

Total shareholders' equity

$

2,723,983

$

2,780,836

$

2,785,522

$

2,756,737

$

2,732,966

Less: goodwill and other intangible assets, net of def. tax liability

(1,142,350

)

(1,144,604

)

(1,146,874

)

(1,149,161

)

(1,150,939

)

Tangible equity

1,581,633

1,636,232

1,638,648

1,607,576

1,582,027

Less: preferred shareholders' equity

(144,484

)

(144,484

)

(144,484

)

(144,484

)

(144,529

)

Tangible common equity

1,437,149

1,491,748

1,494,164

1,463,092

1,437,498

Total assets

16,892,111

16,966,867

17,057,788

16,425,610

16,552,140

Less: goodwill and other intangible assets, net of def. tax liability

(1,142,350

)

(1,144,604

)

(1,146,874

)

(1,149,161

)

(1,150,939

)

Tangible assets

$

15,749,761

$

15,822,263

$

15,910,914

$

15,276,449

$

15,401,201

Tangible equity to tangible assets

10.04

%

10.34

%

10.30

%

10.52

%

10.27

%

Tangible common equity to tangible assets

9.12

%

9.43

%

9.39

%

9.58

%

9.33

%

(1) Tax effected at 21% for all periods presented.

(2) The ratios are annualized by utilizing actual number of days in the quarter versus the year.

WESBANCO, INC.

Consolidated Selected Financial Highlights

NON-GAAP FINANCIAL MEASURES

The following non-GAAP financial measures used by WesBanco provide information useful to investors in understanding WesBanco's operating performance and trends, and facilitate comparisons with the performance of WesBanco's peers. The following tables summarize the non-GAAP financial measures derived from amounts reported in WesBanco's financial statements.

Three Months Ended

Year to Date

Sept. 30,

June 30,

Mar. 31,

Dec. 31,

Sept. 30,

Sept. 30,

(unaudited, dollars in thousands, except shares and per share amounts)

2021

2021

2021

2020

2020

2021

2020

Pre-tax, pre-provision income:

Income before provision for income taxes

$

55,059

$

89,180

$

91,317

$

64,557

$

48,974

$

235,557

$

80,521

Add: provision for credit losses

(1,730

)

(21,025

)

(27,958

)

(209

)

16,288

(50,714

)

107,949

Pre-tax, pre-provision income

$

53,329

$

68,155

$

63,359

$

64,348

$

65,262

$

184,843

$

188,470

Pre-tax, pre-provision income, excluding restructuring and merger-related expenses:

Income before provision for income taxes

$

55,059

$

89,180

$

91,317

$

64,557

$

48,974

$

235,557

$

80,521

Add: provision for credit losses

(1,730

)

(21,025

)

(27,958

)

(209

)

16,288

(50,714

)

107,949

Add: restructuring and merger-related expenses

4,467

1,222

851

484

3,608

6,540

9,241

Pre-tax, pre-provision income, excluding restructuring and merger-related expenses

$

57,796

$

69,377

$

64,210

$

64,832

$

68,870

$

191,383

$

197,711

'Return on average assets, excluding certain items (1):

Income before provision for income taxes

$

55,059

$

89,180

$

91,317

$

64,557

$

48,974

$

235,557

$

80,521

Add: provision for credit losses

(1,730

)

(21,025

)

(27,958

)

(209

)

16,288

(50,714

)

107,949

Add: restructuring and merger-related expenses

4,467

1,222

851

484

3,608

6,540

9,241

Pre-tax, pre-provision income, excluding restructuring and merger-related expenses

57,796

69,377

64,210

64,832

68,870

191,383

197,711

Average total assets

$

17,042,147

$

17,042,147

$

16,636,258

$

16,546,761

$

16,719,717

$

16,840,324

$

16,407,765

Return on average assets, excluding certain items (annualized) (1) (2)

1.35

%

1.63

%

1.57

%

1.56

%

1.64

%

1.52

%

1.61

%

Return on average equity, excluding certain items (1):

Income before provision for income taxes

$

55,059

$

89,180

$

91,317

$

64,557

$

48,974

$

235,557

$

80,521

Add: provision for credit losses

(1,730

)

(21,025

)

(27,958

)

(209

)

16,288

(50,714

)

107,949

Add: restructuring and merger-related expenses

4,467

1,222

851

484

3,608

6,540

9,241

Pre-tax, pre-provision income, excluding restructuring and merger-related expenses

57,796

69,377

64,210

64,832

68,870

191,383

197,711

Average total shareholders' equity

$

2,801,455

$

2,801,455

$

2,770,416

$

2,744,936

$

2,662,513

$

2,786,021

$

2,619,996

Return on average equity, excluding certain items (annualized) (1) (2)

8.19

%

9.93

%

9.40

%

9.40

%

10.29

%

9.18

%

10.08

%

Return on average tangible equity, excluding certain items (1):

Income before provision for income taxes

$

55,059

$

89,180

$

91,317

$

64,557

$

48,974

$

235,557

$

80,521

Add: provision for credit losses

(1,730

)

(21,025

)

(27,958

)

(209

)

16,288

(50,714

)

107,949

Add: amortization of intangibles

2,854

2,873

2,896

3,327

3,346

8,622

10,085

Add: restructuring and merger-related expenses

4,467

1,222

851

484

3,608

6,540

9,241

Income before provision, restructuring and merger-related expenses and amortization of intangibles

60,650

72,250

67,106

68,159

72,216

200,005

207,796

Average total shareholders' equity

2,801,455

2,801,455

2,770,416

2,744,936

2,662,513

2,786,021

2,619,996

Less: average goodwill and other intangibles, net of def. tax liability

(1,143,522

)

(1,145,882

)

(1,148,171

)

(1,150,184

)

(1,150,549

)

(1,145,841

)

(1,138,621

)

Average tangible equity

$

1,657,933

$

1,655,573

$

1,622,245

$

1,594,752

$

1,511,964

$

1,640,180

$

1,481,375

Return on average tangible equity, excluding certain items (annualized) (1) (2)

14.51

%

17.50

%

16.78

%

17.00

%

19.00

%

16.30

%

18.74

%

Average tangible common equity

$

1,513,449

$

1,511,089

$

1,477,736

$

1,450,243

$

1,431,657

$

1,495,696

$

1,454,411

Return on average tangible common equity, excluding provision items (annualized) (1) (2)

15.90

%

19.18

%

18.42

%

18.70

%

20.07

%

17.88

%

19.08

%

(1)

Certain items excluded from the calculations consist of credit provisions, tax provisions and restructuring and merger-related expenses.

(2)

The ratios are annualized by utilizing actual numbers of days in the quarter versus the year.