WSBC
$30.59
Wesbanco
$1.29
4.40%
Earnings Details
3rd Quarter September 2020
Wednesday, October 21, 2020 4:15:00 PM
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Summary

Wesbanco (WSBC) Recent Earnings

Wesbanco (WSBC) reported 3rd Quarter September 2020 earnings of $0.66 per share on revenue of $168.3 million. The consensus earnings estimate was $0.57 per share on revenue of $151.5 million. Revenue grew 16.6% on a year-over-year basis.

Wesbanco Inc offers financial services including retail banking, corporate banking, personal & corporate trust services, brokerage services, mortgage banking & insurance. It offers these services through community banking & trust & investment services.

Results
Reported Earnings
$0.66
Earnings Whisper
-
Consensus Estimate
$0.57
Reported Revenue
$168.3 Mil
Revenue Estimate
$151.5 Mil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

WesBanco Announces Third Quarter 2020 Financial Results

WHEELING, W.Va., Oct. 21, 2020 /PRNewswire/ -- 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, 2020.  Reflecting the impact from the 2020 adoption of the new Current Expected Credit Losses ("CECL") accounting standard, net income for the three months ended September 30, 2020 was $41.3 million, with diluted earnings per share of $0.61, compared to $37.3 million and $0.68 per diluted share, respectively, for the third quarter of 2019.  For the nine months ended September 30, 2020, net income was $69.2 million, or $1.03 per diluted share, compared to $122.5 million, or $2.24 per diluted share, for the 2019 period.  Net income excluding after-tax restructuring and merger-related expenses for the three months ended September 30, 2020, was $44.2 million, or $0.66 per diluted share, as compared to $38.7 million and $0.71 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, 2020 was $76.5 million, or $1.14 per diluted share, as compared to $2.31 per diluted share in the prior year period (non-GAAP measures).




For the Three Months Ended September 30,


For the Nine Months Ended September 30,




2020


2019


2020


2019

(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 (Non-GAAP)(1)


$      44,155


$       0.66


$      38,681


$       0.71


$      76,489


$       1.14


$    126,349


$       2.31

Less: After tax restructuring and merger-
related expenses(2)


(2,850)


(0.05)


(1,334)


(0.03)


(7,300)


(0.11)


(3,852)


(0.07)

Net income (GAAP)


$      41,305


$       0.61


$      37,347


$       0.68


$      69,189


$       1.03


$    122,497


$       2.24

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

(2)For the third quarter of 2020, after tax merger-related expenses totaled $0.5 million, and after tax restructuring expenses from financial center optimization totaled $2.3 million.

On November 22, 2019, WesBanco consummated the merger with Old Line Bancshares, Inc. ("OLBK"), a bank holding company headquartered in Bowie, MD with approximately $3.0 billion in assets, excluding goodwill.  Financial results for OLBK have been included in WesBanco's results from the merger consummation date.

WesBanco believes that pre-tax, pre-provision income (non-GAAP measure) provides a more comparable year-over-year measure as it removes the impact of the new CECL accounting standard implemented earlier this year.  For the three months ended September 30, 2020, pre-tax, pre-provision income, excluding merger-related expenses, increased 33.8% year-over-year to $68.9 million compared to $51.5 million.  On the same basis, pre-tax, pre-provision income, for the nine months ended September 30, 2020, increased 20.5% year-over-year to $197.7 million compared to $164.0 million.  In addition, on the same basis, the return on average assets was 1.64% for the three month period and 1.61% for the nine month period.  WesBanco believes that these non-GAAP financial measures are useful to investors as they enhance investors' understanding of the company's business and performance.

Financial and operational highlights during the quarter ended September 30, 2020:

  • WesBanco is a well-capitalized financial institution with solid liquidity and a strong balance sheet
  • Capital was enhanced with the issuance of $150 million of non-cumulative perpetual preferred stock
  • Organic loan growth was 10.0% year-over-year, driven by WesBanco's support of small businesses impacted by the pandemic, as well as the commercial real estate loan category
    • Commercial real estate loans increased organically 4.9% year-over-year due to new loan production, funding of construction loans originated during 2019, and lower payoffs compared to last year
    • Funding of nearly 7,200 loans totaling approximately $853.1 million through the Small Business Administration's Payroll Protection Program ("SBA PPP"), as established by the CARES Act
  • Pandemic-related loan deferrals have continued to decline and, as of October 16, represent 4.9% of total loans
  • Organic deposit growth, excluding certificates of deposit, was 12.9% year-over-year, driven by growth in demand deposits
  • Mortgage banking income increased 228.0% year-over-year to a record $8.5 million due to strong originations and organic growth in the current low interest rate environment
  • Continued expense management demonstrated by a year-to-date efficiency ratio of 56.15% (non-GAAP measure)
  • On August 27, 2020, WesBanco Bank announced the acceleration of its financial center optimization strategy that will consolidate 25 locations by early 2021, with expected gross cost savings of approximately $6.0 to $6.5 million
  • 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, for the four quarters prior to the current earnings period

"We are pleased with WesBanco's performance during the third quarter as we exhibited strong fee income growth and disciplined expense management to deliver growth of 33.8% year-over-year and 3.0% quarter-over-quarter in our pre-tax, pre-provision income," said Todd F. Clossin, President and Chief Executive Officer of WesBanco.  "WesBanco is a well-capitalized institution with peer-leading reserve levels combined with diversified growth engines and diligent expense management.  We remain focused on the long-term success of our company for our shareholders, customers, and communities."

Mr. Clossin added, "I continue to be extremely proud of our employees as they have gone above and beyond to serve our customers and communities during the last six months.  In addition to our company donating more than a half million dollars for pandemic-related efforts, our employees continue to provide their time and efforts supporting local charitable organizations.  They have assisted more than 7,200 businesses secure Payroll Protection Program loans from the Small Business Administration.  Furthermore, they helped nearly 2,300 small business and commercial, 550 residential mortgage, 490 consumer loan, and 230 home equity loan customers during the early stages of the pandemic with primarily 90-day loan deferrals.  Our customers have been very grateful for our efforts that allowed them to worry about one less thing during this unprecedented time.  These actions speak loudly to our community bank roots."

Financial Center Optimization Strategy
WesBanco annually reviews the needs of the communities it serves, as well as the performance of its financial centers, to identify necessary improvement plans.  Based in part on customer migration to digital channels, community transition, and capital deployment, it has closed 15 locations during the last three years.  Reflecting the current operating environment and increased utilization of digital services, WesBanco announced, on August 27, 2020, a plan to accelerate its financial center optimization strategy.  Through this plan, WesBanco will consolidate a total of 25 existing locations and convert two others to drive-up only locations across Indiana, Kentucky, Ohio, Pennsylvania, and West Virginia.  One location closed during the last week of September, two others are slated for closure during the fourth quarter of 2020, and the remainder will close on or about January 22, 2021.  Cost savings of approximately $6.0 to $6.5 million are expected to be phased-in during the first half of 2021.  During the next few quarters, including the third quarter of 2020, WesBanco anticipates incurring total charges of approximately $3.5 to $4.0 million due to the disposition of assets, lease terminations, severance, and other costs associated with the closures, of which $3.0 million was incurred during the third quarter of 2020.  Importantly, staff at the locations being consolidated will be given the opportunity to fill certain open positions at other nearby financial centers.

Balance Sheet
Portfolio loans of $11.0 billion as of September 30, 2020 increased 41.7% when compared to the prior year period due to the OLBK acquisition and participation in the SBA PPP.  Total organic loan growth was 10.0% year-over-year, driven by the SBA PPP and commercial real estate loans.  Total deposits increased 40.8% year-over-year to $12.2 billion due primarily to the OLBK acquisition, CARES Act stimulus, and increased personal savings.  Total deposits, excluding the OLBK acquisition, increased $1.1 billion, or 12.9%, year-over-year due to CARES Act stimulus and increased personal savings, which more than offset a $0.4 million reduction in certificates of deposit.

Credit Quality
As of September 30, 2020, both 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. The granting of loan deferrals has resulted in continued relatively benign asset quality metrics, as nonperforming and delinquency amounts do not reflect loans that have been modified as a result of the COVID-19 pandemic. Total loans past due as a percentage of total portfolio loans of 25 basis points decreased 5 basis points year-over-year and 26 basis points sequentially.  In addition, annualized net loan charge-offs to average loans remained low for the quarter and year-to-date periods at zero and 8 basis points, respectively.

The provision for credit losses of $16.3 million decreased significantly from the second quarter due to improved macroeconomic factors.  The allowance for credit losses specific to total portfolio loans at September 30, 2020 was $185.1 million, or 1.68% of total loans; or, when excluding SBA PPP loans, 1.83% of total portfolio loans.  Excluded from the allowance for credit losses and related coverage ratio are fair market value adjustments on previously acquired loans representing 0.43% of total loans.

Criticized and classified loan balances increased to 3.25% of total portfolio loans due primarily to the downgrade of $72 million of hotel loans resulting from low occupancy due to the current pandemic-driven environment.  These downgraded loans satisfy the CARES Act loan deferral guidelines, and have an average LTV of 60% as well as strong guarantor support.  Furthermore, the criticized and classified ratio continued to be favorable to peer bank averages.

Net Interest Margin and Income
The net interest margin of 3.31% for the third quarter of 2020 decreased 25 basis points year-over-year, primarily due to the lower interest rate environment from the five decreases in the Federal Reserve Board's target federal funds rate, totaling 225 basis points, from July 2019 through March 2020, as well as a flattening of the yield curve.  Reflecting the significantly lower interest rate environment, we aggressively reduced our deposit rates beginning in late March, which helped to lower deposit funding costs 45 basis points year-over-year to 26 basis points for the third quarter of 2020.  In addition, we shortened the maturities and experienced lower rates in our third quarter FHLB borrowings as compared to the prior year, which helped to lower the cost of borrowings 35 basis points year-over-year.  Accretion from acquisitions benefited the third quarter net interest margin by 18 basis points, as compared to 13 basis points in the prior year period and 19 basis points during the second quarter of 2020.  Lastly, while the SBA PPP loans will positively impact the net interest margin as the loans are forgiven during the next several quarters, the funding of these loans benefited the third quarter of 2020 net interest margin by a net two basis points.

Net interest income increased $24.5 million, or 25.5%, during the third quarter of 2020, as compared to the same quarter of 2019, due to a 34.8% increase in average total earning assets, primarily driven by the OLBK acquisition and related accretion from purchase accounting, partially offset by the lower loan yields, reflecting repricing of existing loans and lower new offered rates in the current market environment.  For the nine months ended September 30, 2020, net interest income increased $66.8 million, or 22.8%, due to higher average total earning assets, despite an overall lower net interest margin, as discussed for the three-month period comparison.

Non-Interest Income
For the third quarter of 2020, non-interest income of $34.6 million increased $7.7 million, or 28.4%, from the third quarter of 2019, driven primarily by mortgage banking income and higher commercial customer loan swap-related income, which were partially offset by lower service charges on deposits.  Reflecting the low interest rate environment and organic growth, mortgage banking fees increased $5.9 million, or 228.0%, compared to the prior year period, as residential mortgage origination dollar volume doubled, with approximately 75% of those originations sold into the secondary market.  Loan swap-related income for the quarter was $1.3 million reflecting commercial loan customer demand in the current rate environment.  This quarter represented the one-year anniversary of the limitation on interchange fees due to the Durbin amendment in the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act ("Dodd-Frank Act").  Service charges on deposits were lower due to higher consumer deposits associated with CARES Act stimulus and lower general consumer spending, resulting in fewer eligible account fees.  Primarily reflecting the items discussed above, non-interest income, for the nine months ended September 30, 2020, increased $9.6 million, or 11.2%.

Non-Interest Expense
Excluding restructuring and merger-related expenses, non-interest expense for the three months ended September 30, 2020 increased $14.8 million, or 20.6%, to $86.3 million compared to the prior year period, primarily reflecting additional staffing and financial center locations from the OLBK acquisition.  Total operating expenses continued to be well-controlled through company-wide efforts to effectively manage discretionary costs, open positions, and marketing expenses.  These efforts are demonstrated by efficiency ratios of 55.23% and 56.15% for the three-month and nine-month periods ending September 30, 2020, respectively.  FDIC insurance expense increased $3.2 million, or 259.5%, due to a higher assessment rate associated with our larger asset level, as well as the recording of a $2.4 million assessment credit in the prior year period.  On a similar basis, non-interest expense during the first nine months of 2020 increased $42.8 million, or 19.9%, compared to the prior year period, primarily reflecting the OLBK acquisition and the mid-year annual salary increases.

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, 2020, Tier I leverage was 10.18%, Tier I risk-based capital ratio was 14.29%, common equity Tier 1 capital ratio ("CET 1") was 12.99%, and total risk-based capital was 17.18%. 

As compared to the prior year period, Tier 1 leverage and Tier 1 risk-based capital ratios were adversely impacted by the movement of $136.5 million of trust preferred securities, during the fourth quarter of 2019, from Tier 1 to Tier 2 risk-based capital, as required by the Dodd-Frank Act for financial institutions with total assets greater than $15 billion.  As an offset to this requirement, WesBanco, on August 4, 2020, raised $150 million of preferred stock, considered Tier 1 capital, through the issuance of 6,000,000 depositary shares, which are listed on the Nasdaq Global Select Market under the symbol "WSBCP".  The net proceeds from this issuance are expected to be used for general corporate purposes, which may include repayment, redemption or refinancing of indebtedness, capital expenditures, making contributions to the capital of WesBanco Bank to support its lending, investing and other financial services activities, funding of possible acquisitions, working capital, satisfaction of other obligations of WesBanco and its subsidiaries, and repurchase of WesBanco's outstanding equity securities.

Conference Call and Webcast
WesBanco will host a conference call to discuss the Company's financial results for the third quarter of 2020 at 3:00 p.m. ET on Thursday, October 22, 2020.  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 10136715.  The replay will begin at approximately 5:00 p.m. ET on October 22, and end at 12 a.m. ET on November 5.  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, 2019 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 and June 30, 2020, 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 and under "Risk Factors" in Part II, Item 1A of WesBanco's March 31, 2020 Quarterly Report on Form 10-Q.  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 $4.6 billion of assets under management (as of September 30, 2020).  WesBanco's banking subsidiary, WesBanco Bank, Inc., operates 235 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.

 



















WESBANCO, INC.














Consolidated Selected Financial Highlights











Page 5



(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,



Interest and dividend income

2020


2019


% Change


2020


2019


% Change




Loans, including fees

$           116,524


$             95,369


22.2


$           351,095


$           287,287


22.2




Interest and dividends on securities:
















Taxable 

11,669


15,887


(26.6)


42,702


49,061


(13.0)





Tax-exempt

4,182


4,759


(12.1)


12,940


15,443


(16.2)






Total interest and dividends on securities

15,851


20,646


(23.2)


55,642


64,504


(13.7)




Other interest income 

1,282


1,333


(3.8)


4,062


4,153


(2.2)



          Total interest and dividend income

133,657


117,348


13.9


410,799


355,944


15.4



Interest expense















Interest bearing demand deposits

1,225


4,489


(72.7)


5,970


12,749


(53.2)




Money market deposits

707


1,973


(64.2)


3,937


5,881


(33.1)




Savings deposits

303


861


(64.8)


1,523


2,061


(26.1)




Certificates of deposit

3,197


3,830


(16.5)


10,765


11,831


(9.0)






Total interest expense on deposits

5,432


11,153


(51.3)


22,195


32,522


(31.8)




Federal Home Loan Bank borrowings

5,457


6,645


(17.9)


20,982


19,269


8.9




Other short-term borrowings

304


1,353


(77.5)


1,454


4,392


(66.9)




Subordinated debt and junior subordinated debt 

1,871


2,077


(9.9)


6,400


6,820


(6.2)






Total interest expense

13,064


21,228


(38.5)


51,031


63,003


(19.0)



Net interest income 

120,593


96,120


25.5


359,768


292,941


22.8




Provision for credit losses

16,288


4,121


 NM 


107,949


9,375


 NM 



Net interest income after provision for credit losses

104,305


91,999


13.4


251,819


283,566


(11.2)



Non-interest income















Trust fees

6,426


6,425


0.0


19,580


19,880


(1.5)




Service charges on deposits

5,332


7,056


(24.4)


16,272


19,803


(17.8)




Electronic banking fees

4,780


5,253


(9.0)


13,100


18,299


(28.4)




Net securities brokerage revenue

1,725


1,765


(2.3)


4,787


5,597


(14.5)




Bank-owned life insurance

2,088


1,373


52.1


5,609


4,032


39.1




Mortgage banking income

8,488


2,588


228.0


17,295


5,262


228.7




Net securities gains

787


235


234.9


3,577


3,800


(5.9)




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

(19)


158


(112.0)


84


670


(87.5)




Other income

5,005


2,097


138.7


15,177


8,535


77.8






Total non-interest income

34,612


26,950


28.4


95,481


85,878


11.2



Non-interest expense















Salaries and wages

38,342


32,915


16.5


114,025


95,501


19.4




Employee benefits

10,604


9,726


9.0


31,115


29,419


5.8




Net occupancy

7,092


5,392


31.5


20,809


16,343


27.3




Equipment 

6,229


5,273


18.1


17,991


14,924


20.6




Marketing

1,577


1,505


4.8


4,282


4,002


7.0




FDIC insurance 

1,948


(1,221)


259.5


6,456


1,287


401.6




Amortization of intangible assets

3,346


2,446


36.8


10,085


7,424


35.8




Restructuring and merger-related expense

3,608


1,688


113.7


9,241


4,876


89.5




Other operating expenses  

17,197


15,544


10.6


52,775


45,876


15.0






Total non-interest expense

89,943


73,268


22.8


266,779


219,652


21.5



Income before provision for income taxes

48,974


45,681


7.2


80,521


149,792


(46.2)




Provision for income taxes 

7,669


8,334


(8.0)


11,332


27,295


(58.5)



Net Income


41,305


37,347


10.6


69,189


122,497


(43.5)



Preferred stock dividends

-


-


-


-


-


-



Net income available to common shareholders

$             41,305


$             37,347


10.6


$             69,189


$           122,497


(43.5)





































Taxable equivalent net interest income

$          121,705


$            97,385


25.0


$          363,208


$          297,046


22.3




















Per common share data














Net income per common share - basic

$                 0.61


$                 0.68


(10.3)


$                 1.03


$                 2.24


(54.0)



Net income per common share - diluted

0.61


0.68


(10.3)


1.03


2.24


(54.0)



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

0.66


0.71


(7.0)


1.14


2.31


(50.6)



Dividends declared

0.32


0.31


3.2


0.96


0.93


3.2



Book value (period end)

40.66


38.42


5.8


40.66


38.42


5.8



Tangible common book value (period end) (1)

21.39


21.89


(2.3)


21.39


21.89


(2.3)



Average common shares outstanding - basic

67,214,759


54,695,578


22.9


67,268,449


54,641,057


23.1



Average common shares outstanding - diluted

67,269,303


54,751,344


22.9


67,351,857


54,705,761


23.1



Period end common shares outstanding

67,216,012


54,691,225


22.9


67,216,012


54,691,225


22.9



Period end preferred shares outstanding

150,000


-


100.0


150,000


-


100.0




















(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















Page 6



(unaudited, dollars in thousands)






































Selected ratios


























For the Nine Months Ended











September 30,












2020


2019


% Change






























Return on average assets





0.56

%

1.31

%

(57.25)

%









Return on average assets, excluding


















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


0.62


1.35


(54.07)










Return on average equity





3.53


7.99


(55.82)










Return on average equity, excluding


















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


3.90


8.24


(52.67)










Return on average tangible equity (1)




6.96


14.97


(53.51)










Return on average tangible equity, excluding 


















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


7.62


15.42


(50.58)










Return on average tangible common equity (1)




7.09


14.97


(52.64)










Return on average tangible common equity, excluding 

















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


7.76


15.42


(49.68)










Yield on earning assets (2) 





3.86


4.41


(12.47)










Cost of interest bearing liabilities





0.69


1.07


(35.51)










Net interest spread (2)






3.17


3.34


(5.09)










Net interest margin (2)






3.38


3.64


(7.14)










Efficiency (1) (2)






56.15


56.09


0.11










Average loans to average deposits




92.37


87.77


5.24










Annualized net loan charge-offs/average loans




0.08


0.05


60.00










Effective income tax rate 





14.07


18.22


(22.78)
































































































For the Quarter Ended












Sept. 30,


June 30,


Mar. 31,


Dec. 31,


Sept. 30,












2020


2020


2020


2019


2019


























Return on average assets





0.98

%

0.11

%

0.60

%

1.04

%

1.19

%





Return on average assets, excluding


















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


1.05


0.12


0.70


1.30


1.23






Return on average equity





6.17


0.69


3.63


6.20


7.06






Return on average equity, excluding


















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


6.60


0.75


4.26


7.75


7.32






Return on average tangible equity (1)




11.56


1.98


7.07


11.53


13.06






Return on average tangible equity, excluding 


















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


12.31


2.08


8.18


14.24


13.50






Return on average tangible common equity (1)




12.21


1.98


7.07


11.53


13.06






Return on average tangible common equity, excluding 





.












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


13.00


2.08


8.18


14.24


13.50






Yield on earning assets (2) 





3.66


3.75


4.19


4.25


4.34






Cost of interest bearing liabilities





0.53


0.63


0.91


0.99


1.09






Net interest spread (2)






3.13


3.12


3.28


3.26


3.25






Net interest margin (2)






3.31


3.32


3.54


3.55


3.56






Efficiency (1) (2) 






55.23


55.57


57.69


58.29


57.57






Average loans to average deposits




90.88


91.87


94.61


90.78


88.96






Annualized net loan charge-offs and recoveries /average loans

(0.00)


0.07


0.18


0.20


0.04






Effective income tax rate 





15.66


0.93


13.40


16.23


18.24






Trust assets, market value at period end




$        4,649,054


$        4,487,042


$        4,082,141


$        4,719,966


$        4,443,430


























(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








Page 7



(unaudited, dollars in thousands, except shares)








% Change



Balance sheets


September 30,



December 31

December 31, 2019



Assets


2020


2019


% Change

2019

to September 30, 2020



Cash and due from banks


$           215,982


$         209,606


3.0

$               182,905

18.1



Due from banks - interest bearing


544,284


34,727


 NM 

51,891

 NM 



Securities:












Equity securities, at fair value


12,516


11,644


7.5

12,343

1.4




Available-for-sale debt securities, at fair value


2,045,924


2,209,199


(7.4)

2,393,558

(14.5)




Held-to-maturity debt securities (fair values of $782,401; $877,809 












and $874,523, respectively)


746,767


852,824


(12.4)

851,753

(12.3)





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


(461)


-


(100.0)

-

(100.0)




Net held-to-maturity debt securities


746,306


852,824


(12.5)

851,753

(12.4)





Total securities


2,804,746


3,073,667


(8.7)

3,257,654

(13.9)



Loans held for sale


134,151


20,715


547.6

43,013

211.9



Portfolio loans:












Commercial real estate


5,708,648


3,854,653


48.1

5,725,008

(0.3)




Commercial and industrial


2,507,235


1,332,275


88.2

1,644,699

52.4




Residential real estate 


1,798,019


1,638,574


9.7

1,873,647

(4.0)




Home equity


647,052


587,745


10.1

649,678

(0.4)




Consumer 


328,592


343,505


(4.3)

374,953

(12.4)



Total portfolio loans, net of unearned income


10,989,546


7,756,752


41.7

10,267,985

7.0



Allowance for credit losses - loans  (1)


(185,109)


(54,317)


(240.8)

(52,429)

(253.1)





Net portfolio loans


10,804,437


7,702,435


40.3

10,215,556

5.8



Premises and equipment, net


248,491


178,344


39.3

261,014

(4.8)



Accrued interest receivable


65,023


37,156


75.0

43,648

49.0



Goodwill and other intangible assets, net


1,165,566


914,705


27.4

1,149,153

1.4



Bank-owned life insurance


304,288


229,349


32.7

299,516

1.6



Other assets


265,172


193,183


37.3

215,762

22.9



Total Assets


$      16,552,140


$    12,593,887


31.4

$          15,720,112

5.3














Liabilities











Deposits:












Non-interest bearing demand


$         4,073,305


$      2,476,392


64.5

$            3,178,270

28.2




Interest bearing demand


2,633,601


2,128,581


23.7

2,316,855

13.7




Money market


1,619,410


1,085,732


49.2

1,518,314

6.7




Savings deposits


2,167,597


1,698,125


27.6

1,934,647

12.0




Certificates of deposit


1,707,512


1,275,533


33.9

2,055,920

(16.9)





Total deposits


12,201,425


8,664,363


40.8

11,004,006

10.9



Federal Home Loan Bank borrowings


794,621


1,161,092


(31.6)

1,415,615

(43.9)



Other short-term borrowings


381,909


325,247


17.4

282,362

35.3



Subordinated debt and junior subordinated debt 


192,150


156,632


22.7

199,869

(3.9)





Total borrowings


1,368,680


1,642,971


(16.7)

1,897,846

(27.9)



Accrued interest payable


5,014


5,273


(4.9)

8,077

(37.9)



Other liabilities


244,055


180,011


35.6

216,262

12.9



Total Liabilities


13,819,174


10,492,618


31.7

13,126,191

5.3














Shareholders' Equity











Preferred stock, no par value; 1,000,000 shares authorized in 2020 and 2019, respectively; 












150,000 shares 6.75% non-cumulative perpetual preferred stock, Series A, 












liquidation preference $150.0 million, issued and outstanding at September 30, 2020












and 0 shares issued and outstanding at December 31, 2019, respectively.


144,529


-


100.0

-

100.0



Common stock, $2.0833 par value; 100,000,000 shares authorized in












2020 and 2019, respectively; 68,081,306,  54,698,250 and 68,078,116 shares












issued, respectively; 67,216,012, 54,691,225 and 67,824,428 shares


141,834


113,954


24.5

141,827

0.0




outstanding, respectively











Capital surplus


1,634,172


1,169,595


39.7

1,636,966

(0.2)



Retained earnings


802,892


809,332


(0.8)

824,694

(2.6)



Treasury stock ( 865,294, 7,025 and 253,688 shares - at cost, respectively)


(27,403)


(252)


 NM 

(9,463)

(189.6)



Accumulated other comprehensive income (loss)


38,301


9,922


286.0

1,201

 NM 



Deferred benefits for directors


(1,359)


(1,282)


(6.0)

(1,304)

(4.2)



Total Shareholders' Equity


2,732,966


2,101,269


30.1

2,593,921

5.4



Total Liabilities and Shareholders' Equity


$      16,552,140


$    12,593,887


31.4

$          15,720,112

5.3

























(1) Allowance for credit losses - loans as of September 30, 2020 includes a day 1 adjustment of $41.4 million due to the adoption of ASU 2016-13.


















NM - Not Meaningful





















 

 










WESBANCO, INC.








Consolidated Selected Financial Highlights





Page 8



(unaudited, dollars in thousands, except shares)








Balance sheets


September 30,


June 30,




Assets


2020


2020

% Change



Cash and due from banks


$           215,982


$         219,022

(1.4)



Due from banks - interest bearing


544,284


671,312

(18.9)



Securities:









Equity securities, at fair value


12,516


12,277

1.9




Available-for-sale, at fair value


2,045,924


2,073,949

(1.4)




Held-to-maturity (fair values of $782,401 and 802,666, respectively)


746,767


766,416

(2.6)





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


(461)


(817)

43.6




Net held-to-maturity debt securities


746,306


765,599

(2.5)





Total securities


2,804,746


2,851,825

(1.7)



Loans held for sale


134,151


53,324

151.6



Portfolio Loans:









Commercial real estate


5,708,648


5,694,457

0.2




Commercial and industrial


2,507,235


2,496,096

0.4




Residential real estate 


1,798,019


1,893,544

(5.0)




Home equity


647,052


646,323

0.1




Consumer 


328,592


343,723

(4.4)



Total portfolio loans, net of unearned income


10,989,546


11,074,143

(0.8)



Allowance for credit losses - loans  (1)


(185,109)


(168,475)

(9.9)




Net portfolio loans


10,804,437


10,905,668

(0.9)



Premises and equipment, net


248,491


255,306

(2.7)



Accrued interest receivable


65,023


59,151

9.9



Goodwill and other intangible assets, net


1,165,566


1,166,853

(0.1)



Bank-owned life insurance


304,288


303,022

0.4



Other assets


265,172


269,912

(1.8)



Total Assets


$      16,552,140


$    16,755,395

(1.2)













Liabilities








Deposits:









Non-interest bearing demand


$         4,073,305


$      4,067,903

0.1




Interest bearing demand


2,633,601


2,596,132

1.4




Money market


1,619,410


1,610,248

0.6




Savings deposits


2,167,597


2,103,154

3.1




Certificates of deposit


1,707,512


1,809,016

(5.6)





Total deposits


12,201,425


12,186,453

0.1



Federal Home Loan Bank borrowings


794,621


1,129,631

(29.7)



Other short-term borrowings


381,909


390,777

(2.3)



Subordinated debt and junior subordinated debt 


192,150


192,080

0.0





Total borrowings


1,368,680


1,712,488

(20.1)



Accrued interest payable


5,014


6,040

(17.0)



Other liabilities


244,055


280,893

(13.1)



Total liabilities


13,819,174


14,185,874

(2.6)













Shareholders' Equity








Preferred stock, no par value; 1,000,000 shares authorized in 2020 and 2019, respectively; 









150,000 shares 6.75% non-cumulative perpetual preferred stock, Series A, 









liquidation preference $150.0 million, issued and outstanding at September 30, 2020









and 0 shares issued and outstanding at December 31, 2019, respectively.


144,529


-

100.0



Common stock, $2.0833 par value; 100,000,000 shares authorized;









68,081,306 and 68,078,116 shares issued, respectively;









67,216,012 and 67,211,192 shares outstanding, respectively


141,834


141,827

0.0



Capital surplus


1,634,172


1,633,079

0.1



Retained earnings


802,892


782,990

2.5



Treasury stock (865,294 and 866,924 shares - at cost)


(27,403)


(27,518)

0.4



Accumulated other comprehensive income (loss)


38,301


40,516

(5.5)



Deferred benefits for directors


(1,359)


(1,373)

1.0



Total Shareholders' Equity


2,732,966


2,569,521

6.4



Total Liabilities and Shareholders' Equity


$      16,552,140


$    16,755,395

(1.2)























(1) Allowance for credit losses - loans includes a day 1 adjustment of $41.4 million due to the adoption of ASU 2016-13.


















NM - Not Meaningful

















 

 
























WESBANCO, INC.






















Consolidated Selected Financial Highlights
















Page 9




(unaudited, dollars in thousands)




















Average balance sheet and





















net interest margin analysis




Three Months Ended September 30,




For the Nine Months Ended September 30,










2020

2019



2020

2019









Average 

Average



Average 

Average



Average 

Average



Average 

Average




Assets





Balance

Rate



Balance

Rate



Balance

Rate



Balance

Rate




Due from banks - interest bearing




$           755,575

0.16

%


$             71,163

2.41

%


$                509,928

0.25

%


$           73,617

2.50

%



Loans, net of unearned income (1)




11,107,106

4.17



7,751,724

4.88



10,813,737

4.34



7,704,212

4.99




Securities: (2)






















    Taxable





2,121,780

2.19



2,301,933

2.76



2,328,196

2.45



2,330,439

2.81




    Tax-exempt (3)





603,835

3.49



684,164

3.52



624,278

3.50



744,949

3.50




        Total securities





2,725,615

2.47



2,986,097

2.93



2,952,474

2.67



3,075,388

2.97




Other earning assets 





56,575

6.88



53,181

6.80



65,849

6.27



51,954

7.12




         Total earning assets (3)




14,644,871

3.66

%


10,862,165

4.34

%


14,341,988

3.86

%


10,905,171

4.41

%



Other assets





2,074,846




1,625,988




2,065,777




1,590,847





Total Assets





$      16,719,717




$      12,488,153




$           16,407,765




$     12,496,018



























Liabilities and Shareholders' Equity




















Interest bearing demand deposits




$        2,654,161

0.18

%


$        2,126,720

0.84

%


$             2,518,952

0.32

%


$       2,131,887

0.80

%



Money market accounts 




1,623,969

0.17



1,097,930

0.71



1,590,498

0.33



1,122,665

0.70




Savings deposits





2,140,932

0.06



1,686,267

0.20



2,051,930

0.10



1,674,262

0.16




Certificates of deposit





1,761,087

0.72



1,321,696

1.15



1,865,439

0.77



1,385,349

1.14




    Total interest bearing deposits




8,180,149

0.26



6,232,613

0.71



8,026,819

0.37



6,314,163

0.69




Federal Home Loan Bank borrowings



1,006,593

2.16



1,048,401

2.51



1,285,266

2.18



1,036,464

2.49




Other borrowings





383,771

0.32



317,931

1.69



361,949

0.54



321,976

1.82




Subordinated debt and junior subordinated debt 



192,093

3.87



156,561

5.26



194,195

4.40



169,944

5.37




      Total interest bearing liabilities 



9,762,606

0.53

%


7,755,506

1.09

%


9,868,229

0.69

%


7,842,547

1.07

%



Non-interest bearing demand deposits



4,041,681




2,481,384




3,679,743




2,463,076





Other liabilities





252,917




153,729




239,797




139,761





Shareholders' equity





2,662,513




2,097,534




2,619,996




2,050,634





Total Liabilities and Shareholders' Equity



$      16,719,717




$      12,488,153




$           16,407,765




$     12,496,018





Taxable equivalent net interest spread




3.13

%



3.25

%



3.17

%



3.34

%



Taxable equivalent net interest margin 




3.31

%



3.56

%



3.38

%



3.64

%















































(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 are $6.2 million and $0.4 million for the three months ended September 30, 2020 and 2019, respectively, and are $9.5 million and $1.3 million for the nine months ended September 30, 2020 and 2019, respectively. As part of loan fees for both the three and nine month ended September 30, 2020, is $5.6 million and $7.7 million of PPP loan fees. Additionally, loan accretion included in interest income on loans acquired from prior acquisitions was $4.2 million and $3.4 million for the three months ended September 30, 2020 and 2019, respectively, and are $12.5 million and $13.0 million for the nine months ended September 30, 2020 and 2019, respectively. Accretion on interest bearing liabilities acquired from the prior acquisitions was $2.1 million and $0.3 million for the three months ended September 30, 2020 and 2019, respectively, and are $8.1 million and  $0.9 million for the nine months ended September 30, 2020 and 2019, 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.

























 

 

















WESBANCO, INC.












Consolidated Selected Financial Highlights









 Page 10 



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







Quarter Ended



Statement of Income

Sept.  30,


June 30,


Mar. 31,


Dec. 31,


Sept.  30,



Interest and dividend income

2020


2020


2020


2019


2019




Loans, including fees

$                     116,524


$             115,068


$            119,503


$             105,879


$              95,369




Interest and dividends on securities:














Taxable 

11,669


14,047


16,986


16,586


15,887





Tax-exempt

4,182


4,302


4,456


4,563


4,759






Total interest and dividends on securities

15,851


18,349


21,442


21,149


20,646




Other interest income 

1,282


1,277


1,503


1,281


1,333



          Total interest and dividend income

133,657


134,694


142,448


128,309


117,348



Interest expense













Interest bearing demand deposits

1,225


1,350


3,393


4,054


4,489




Money market deposits

707


879


2,352


2,143


1,973




Savings deposits

303


297


923


935


861




Certificates of deposit

3,197


3,514


4,054


3,800


3,830






Total interest expense on deposits

5,432


6,040


10,723


10,932


11,153




Federal Home Loan Bank borrowings

5,457


7,293


8,232


7,279


6,645




Other short-term borrowings

304


279


870


1,009


1,353




Subordinated debt and junior subordinated debt

1,871


2,069


2,461


2,125


2,077






Total interest expense

13,064


15,681


22,286


21,345


21,228



Net interest income 

120,593


119,013


120,162


106,964


96,120




Provision for credit losses

16,288


61,841


29,821


1,824


4,121



Net interest income after provision for credit losses

104,305


57,172


90,341


105,140


91,999



Non-interest income













Trust fees

6,426


6,202


6,952


6,699


6,425




Service charges on deposits

5,332


4,323


6,617


7,171


7,056




Electronic banking fees

4,780


4,066


4,254


4,336


5,253




Net securities brokerage revenue

1,725


1,384


1,679


1,393


1,765




Bank-owned life insurance

2,088


1,752


1,769


1,882


1,373




Mortgage banking income

8,488


7,531


1,276


2,957


2,588




Net securities gains

787


1,299


1,491


520


235




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

(19)


(66)


169


61


158




Other income

5,005


6,369


3,802


5,819


2,097






Total non-interest income

34,612


32,860


28,009


30,838


26,950



Non-interest expense













Salaries and wages

38,342


36,773


38,910


36,984


32,915




Employee benefits

10,604


10,138


10,373


9,894


9,726




Net occupancy

7,092


6,634


7,084


6,162


5,392




Equipment 

6,229


5,722


6,039


5,570


5,273




Marketing

1,577


1,567


1,138


2,059


1,505




FDIC insurance 

1,948


2,395


2,113


668


(1,221)




Amortization of intangible assets

3,346


3,365


3,374


2,916


2,446




Restructuring and merger-related expense

3,608


468


5,164


11,522


1,688




Other operating expenses  

17,197


18,440


17,138


16,781


15,544






Total non-interest expense

89,943


85,502


91,333


92,556


73,268



Income before provision for income taxes

48,974


4,530


27,017


43,422


45,681




Provision for income taxes 

7,669


42


3,621


7,046


8,334



Net Income


41,305


4,488


23,396


36,376


37,347



Preferred stock dividends

-


-


-


-


-



Net income available to common shareholders

$                       41,305


$                 4,488


$              23,396


$               36,376


$              37,347


















Taxable equivalent net interest income

$                    121,705


$             120,156


$           121,346


$             108,177


$             97,385


















Per common share data












Net income per common share - basic

$                          0.61


$                   0.07


$                 0.34


$                   0.60


$                 0.68



Net income per common share - diluted

0.61


0.07


0.34


0.60


0.68



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

0.66


0.07


0.40


0.75


0.71



Dividends declared

0.32


0.32


0.32


0.31


0.31



Book value (period end)

40.66


38.23


38.56


38.24


38.42



Tangible common book value (period end) (1)

21.39


21.10


21.36


21.55


21.89



Average common shares outstanding - basic

67,214,759


67,104,628


67,486,550


60,461,325


54,695,578



Average common shares outstanding - diluted

67,269,303


67,181,755


67,587,446


60,562,366


54,751,344



Period end common shares outstanding

67,216,012


67,211,192


67,058,155


67,824,428


54,691,225



Full time equivalent employees

2,618


2,676


2,703


2,705


2,330

































(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










 Page 11 




(unaudited, dollars in thousands)


















Quarter Ended








Sept. 30,


June 30,


Mar. 31,


Dec. 31,


Sept. 30,




Asset quality data


2020


2020


2020


2019


2019




Non-performing assets:















Troubled debt restructurings - accruing


$          4,191


$          5,105


$          5,434


$          5,431


$          5,840





Non-accrual loans:
















Troubled debt restructurings


1,818


1,339


1,571


1,422


1,345






Other non-accrual loans


35,448


34,119


32,796


43,491


33,456






    Total non-accrual loans


37,266


35,458


34,367


44,913


34,801






    Total non-performing loans 


41,457


40,563


39,801


50,344


40,641





Other real estate and repossessed assets


738


1,212


1,083


4,178


3,678






Total non-performing assets


$         42,195


$         41,775


$         40,884


$         54,522


$         44,319




















Past due loans (1):















Loans past due 30-89 days


$         17,338


$         30,595


$         32,805


$         36,330


$         17,906





Loans past due 90 days or more


10,170


36,903


14,287


11,613


5,425






Total past due loans


$         27,508


$         67,498


$         47,092


$         47,943


$         23,331




















Criticized and classified loans (2):















Criticized loans


$       248,264


$       148,580


$       120,801


$       118,959


$         78,880





Classified loans


108,594


98,127


95,162


103,519


95,071






Total criticized and classified loans


$       356,858


$       246,707


$       215,963


$       222,478


$       173,951




















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

0.16

%

0.28

%

0.32

%

0.35

%

0.23

%



Loans past due 90 days or more / total portfolio loans

0.09


0.33


0.14


0.11


0.07




Non-performing loans / total portfolio loans


0.38


0.37


0.38


0.49


0.52




Non-performing assets/total portfolio loans, other














real estate and repossessed assets


0.38


0.38


0.39


0.53


0.57




Non-performing assets / total assets


0.26


0.25


0.26


0.35


0.35




Criticized and classified loans / total portfolio loans

3.25


2.23


2.09


2.17


2.24




















Allowance for credit losses














Allowance for credit losses - loans (4)


$       185,109


$       168,475


$       114,272


$         52,429


$         54,317




Provision for credit losses (4)


16,288


61,841


29,821


1,824


4,121




Net loan and deposit account overdraft charge-offs and recoveries

(133)


1,942


4,716


4,476


791




















Annualized net loan charge-offs and recoveries /average loans

(0.00)

%

0.07

%

0.18

%

0.20

%

0.04

%



Allowance for credit losses - loans / total portfolio loans

1.68

%

1.52

%

1.10

%

0.51

%

0.70

%



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

1.83

%

1.65

%

1.10

%

0.51

%

0.70

%



Allowance for credit losses - loans / non-performing loans

4.47

x

4.15

x

2.87

x

1.04

x

1.34

x



Allowance for credit losses - loans / non-performing loans and














loans past due 


2.68

x

1.56

x

1.32

x

0.53

x

0.85

x







































Quarter Ended








Sept. 30,


June 30,


Mar. 31,


Dec. 31,


Sept. 30,








2020


2020


2020


2019


2019




Capital ratios














Tier I leverage capital


10.18

%

9.09

%

9.64

%

11.30

%

11.30

%



Tier I risk-based capital


14.29


12.59


12.51


12.89


15.40




Total risk-based capital


17.18


15.33


14.83


15.12


16.36




Common equity tier 1 capital ratio (CET 1)


12.99


12.59


12.51


12.89


13.87




Average shareholders' equity to average assets


15.92


15.57


16.43


16.73


16.80




Tangible equity to tangible assets (5)


10.27


9.09


9.65


10.02


10.24




Tangible common equity to tangible assets (5)


9.33


9.09


9.65


10.02


10.24




































(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 $853.1 million of PPP loans as of September 30, 2020.












(4) The provision for credit losses includes $0.1 million and $5.1 million for loan commitments for the three months ended September 30, 2020 and June 30, 2020, respectively.





Excludes the allowance for credit losses - loan commitments, which is included in other liabilities, is $10.8 million and $10.7 million as of September 30, 2020 and June 30, 2020, respectively.




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

























 

 


















NON-GAAP FINANCIAL MEASURES












Page 12



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)

2020


2020


2020


2019


2019


2020

2019



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
















Net income

$              41,305


$              4,488


$           23,396


$           36,376


$           37,347


$           69,189

$      122,497




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

2,850


370


4,080


9,102


1,334


7,300

3,852




Net income excluding after-tax restructuring and merger-related expenses

44,155


4,858


27,476


45,478


38,681


76,489

126,349




















Average total assets

$        16,719,717


$      16,715,211


$    15,784,939


$    13,919,430


$    12,488,153


$     16,407,765

$  12,496,018



















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

1.05%


0.12%


0.70%


1.30%


1.23%


0.62%

1.35%



















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
















Net income

$              41,305


$              4,488


$           23,396


$           36,376


$           37,347


$           69,189

$      122,497




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

2,850


370


4,080


9,102


1,334


7,300

3,852




Net income excluding after-tax restructuring and merger-related expenses z

44,155


4,858


27,476


45,478


38,681


76,489

126,349




















Average total shareholders' equity

2,662,513


2,602,938


2,594,069


2,329,121


2,097,534


2,619,996

2,050,634



















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

6.60%


0.75%


4.26%


7.75%


7.32%


3.90%

8.24%



















Return on average tangible equity:
















Net income 

$              41,305


$              4,488


$           23,396


$           36,376


$           37,347


$           69,189

$      122,497




Plus: amortization of intangibles (1)

2,643


2,658


2,665


2,304


1,932


7,967

5,865




Net income before amortization of intangibles 

43,948


7,146


26,061


38,680


39,279


77,156

128,362




















Average total shareholders' equity

2,662,513


2,602,938


2,594,069


2,329,121


2,097,534


2,619,996

2,050,634




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

(1,150,549)


(1,152,856)


(1,112,327)


(997,658)


(904,204)


(1,138,621)

(904,489)




Average tangible equity

$          1,511,964


$        1,450,082


$      1,481,742


$      1,331,463


$      1,193,330


$       1,481,375

$   1,146,145



















Return on average tangible equity (annualized)  (2)

11.56%


1.98%


7.07%


11.53%


13.06%


6.96%

14.97%




















Average common tangible equity

$          1,431,657


$        1,450,082


$      1,481,742


$      1,331,463


$      1,193,330


$       1,454,411

$   1,146,145



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

12.21%


1.98%


7.07%


11.53%


13.06%


7.09%

14.97%



















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
















Net income

$              41,305


$              4,488


$           23,396


$           36,376


$           37,347


$           69,189

$      122,497




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

2,850


370


4,080


9,102


1,334


7,300

3,852




Plus: amortization of intangibles  (1)

2,643


2,658


2,665


2,304


1,932


7,967

5,865




Net income before amortization of intangibles and excluding 
















    after-tax  restructuring and merger-related expenses

46,798


7,516


30,141


47,782


40,613


84,456

132,214




















Average total shareholders' equity

2,662,513


2,602,938


2,594,069


2,329,121


2,097,534


2,619,996

2,050,634




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

(1,150,549)


(1,152,856)


(1,112,327)


(997,658)


(904,204)


(1,138,621)

(904,489)




Average tangible equity

$          1,511,964


$        1,450,082


$      1,481,742


$      1,331,463


$      1,193,330


$       1,481,375

$   1,146,145



















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

12.31%


2.08%


8.18%


14.24%


13.50%


7.62%

15.42%




















Average tangible common equity

$          1,431,657


$        1,450,082


$      1,481,742


$      1,331,463


$      1,193,330


$       1,454,411

$   1,146,145



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

13.00%


2.08%


8.18%


14.24%


13.50%


7.76%

15.42%



















Efficiency ratio:
















Non-interest expense

$              89,943


$            85,502


$           91,333


$           92,556


$           73,268


$         266,779

$      219,652




Less: restructuring and merger-related expense

(3,608)


(468)


(5,164)


(11,522)


(1,688)


(9,241)

(4,876)




Non-interest expense excluding restructuring and merger-related expense

86,335


85,034


86,169


81,034


71,580


257,538

214,776




















Net interest income on a fully taxable equivalent basis

121,705


120,156


121,346


108,177


97,385


363,208

297,046




Non-interest income

34,612


32,860


28,009


30,838


26,950


95,481

85,878




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

$            156,317


$           153,016


$         149,355


$         139,015


$         124,335


$         458,689

$      382,924




Efficiency Ratio

55.23%


55.57%


57.69%


58.29%


57.57%


56.15%

56.09%



















Net income, excluding after-tax  restructuring and merger-related expenses:
















Net income

$              41,305


$              4,488


$           23,396


$           36,376


$           37,347


$           69,189

$      122,497




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

2,850


370


4,080


9,102


1,334


7,300

3,852



Net income, excluding after-tax restructuring and merger-related expenses

$              44,155


$              4,858


$           27,476


$           45,478


$           38,681


$           76,489

$      126,349



































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
















Net income per diluted share

$                  0.61


$                0.07


$              0.35


$              0.60


$              0.68


$               1.03

$            2.24




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

0.05


(0.00)


0.06


0.15


0.03


0.11

0.07



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

$                  0.66


$                0.07


$              0.41


$              0.75


$              0.71


$               1.14

$            2.31





































Period End








Sept. 30,


June 30,


Mar. 31,


Dec. 31


Sept. 30,








2020


2020


2020


2019


2019






Tangible common book value per share:
















Total shareholders' equity

$          2,732,966


$        2,569,521


$      2,586,060


$      2,593,921


$      2,101,269







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

(1,150,939)


(1,151,523)


(1,154,033)


(1,132,262)


(904,256)







Less: preferred shareholders' equity

(144,529)


-


-


-


-







Tangible common equity

1,437,498


1,417,998


1,432,027


1,461,659


1,197,013























Common shares outstanding

67,216,012


67,211,192


67,058,155


67,824,428


54,691,225






















Tangible common book value per share

$                21.39


$              21.10


$             21.36


$             21.55


$             21.89






















Tangible common equity to tangible assets:
















Total shareholders' equity

$          2,732,966


$        2,569,521


$      2,586,060


$      2,593,921


$      2,101,269







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

(1,150,939)


(1,151,523)


(1,154,033)


(1,132,262)


(904,256)







Tangible equity

1,582,027


1,417,998


1,432,027


1,461,659


1,197,013







Less: preferred shareholders' equity

(144,529)


-


-


-


-







Tangible common equity

1,437,498


1,417,998


1,432,027


1,461,659


1,197,013























Total assets

16,552,140


16,755,395


15,995,572


15,720,112


12,593,887







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

(1,150,939)


(1,151,523)


(1,154,033)


(1,132,262)


(904,256)







Tangible assets

$        15,401,201


$      15,603,872


$    14,841,539


$    14,587,850


$    11,689,631






















Tangible equity to tangible assets

10.27%


9.09%


9.65%


10.02%


10.24%






















Tangible common equity to tangible assets

9.33%


9.09%


9.65%


10.02%


10.24%






































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















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






























 

 


















ADDITONAL NON-GAAP FINANCIAL MEASURES












Page 13



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)

2020


2020


2020


2019


2019


2020

2019



Pre-tax, pre-provision income:
















Income before provision for income taxes

$         48,974


$          4,530


$        27,017


$        43,422


$          45,681


$        80,521

$           149,792




Add: provision for credit losses

16,288


61,841


29,821


1,824


4,121


107,949

9,375



Pre-tax, pre-provision income

$         65,262


$        66,371


$        56,838


$        45,246


$          49,802


$      188,470

$           159,167



















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
















Income before provision for income taxes

$         48,974


$          4,530


$        27,017


$        43,422


$          45,681


$        80,521

$           149,792




Add: provision for credit losses

16,288


61,841


29,821


1,824


4,121


107,949

9,375




Add: restructuring and merger-related expenses

3,608


468


5,164


11,522


1,688


9,241

4,876



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

$         68,870


$        66,839


$        62,002


$        56,768


$          51,490


$      197,711

$           164,043



















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
















Income before provision for income taxes

$         48,974


$          4,530


$        27,017


$        43,422


$          45,681


$        80,521

$           149,792




Add: provision for credit losses

16,288


61,841


29,821


1,824


4,121


107,949

9,375




Add: restructuring and merger-related expenses

3,608


468


5,164


11,522


1,688


9,241

4,876



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

68,870


66,839


62,002


56,768


51,490


197,711

164,043




















Average total assets

$   16,719,717


$  16,715,211


$  15,784,939


$  13,919,430


$   12,488,153


$  16,407,765

$      12,496,018



















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

1.64%


1.61%


1.58%


1.62%


1.64%


1.61%

1.76%



















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
















Income before provision for income taxes

$         48,974


$          4,530


$        27,017


$        43,422


$          45,681


$        80,521

$           149,792




Add: provision for credit losses

16,288


61,841


29,821


1,824


4,121


107,949

9,375




Add: restructuring and merger-related expenses

3,608


468


5,164


11,522


1,688


9,241

4,876



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

68,870


66,839


62,002


56,768


51,490


197,711

164,043




















Average total shareholders' equity

2,662,513


2,602,938


2,594,069


2,329,121


2,097,534


2,619,996

2,050,634



















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

10.29%


10.33%


9.61%


9.67%


9.74%


10.08%

10.70%



















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
















Income before provision for income taxes

$         48,974


$          4,530


$        27,017


$        43,422


$          45,681


$        80,521

$           149,792




Add: provision for credit losses

16,288


61,841


29,821


1,824


4,121


107,949

9,375




Add: amortization of intangibles

3,346


3,365


3,374


2,916


2,446


10,085

7,424




Add: restructuring and merger-related expenses

3,608


468


5,164


11,522


1,688


9,241

4,876



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

72,216


70,204


65,376


59,684


53,936


207,796

171,467




















Average total shareholders' equity

2,662,513


2,602,938


2,594,069


2,329,121


2,097,534


2,619,996

2,050,634




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

(1,150,549)


(1,152,856)


(1,112,327)


(997,658)


(904,204)


(1,138,621)

(904,489)




Average tangible equity

$     1,511,964


$   1,450,082


$   1,481,742


$   1,331,463


$     1,193,330


$   1,481,375

$        1,146,145



















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

19.00%


19.47%


17.75%


17.78%


17.93%


18.74%

20.00%




















Average tangible common equity

$     1,431,657


$   1,450,082


$   1,481,742


$   1,331,463


$     1,193,330


$   1,454,411

$        1,146,145



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

20.07%


19.47%


17.75%


17.78%


17.93%


19.08%

20.00%



































(1) Certain items excluded from the calculation consist of credit provision, tax provision and restructuring & merger-related expenses.










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






























 

 

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SOURCE WesBanco, Inc.