ASSOCIATED BANC-CORP - FORM 8-K - EX-99.1 - EXHIBIT 99.1

Attached files

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EX-99.2 - EXHIBIT 99.2 - ASSOCIATED BANC-CORP	asb1q18earningspresentat.htm
8-K - FORM 8-K - ASSOCIATED BANC-CORP	asb03312018form8-kpressrel.htm

Exhibit 99.1



	NEWS RELEASE Investor Contact: Robb Timme, Vice President, Investor Relations 920-491-7059 Media Contact: Jennifer Kaminski, Vice President, Public Relations Senior Manager 920-491-7576

Associated Banc-Corp Reports First Quarter Earnings of $0.40 per common share, or $0.50 per common share excluding $21 million in acquisition related costs¹

Earnings per share up 14% from the prior year

GREEN BAY, Wis. -- April 19, 2018 -- Associated Banc-Corp (NYSE: ASB) ("Associated" or "Company") today reported net income available to common equity ("earnings") of $67 million, or $0.40 per common share for the quarter ended March 31, 2018. This compares to net income available to common equity of $54 million, or $0.35 per common share for the quarter ended March 31, 2017.

“The Bank Mutual acquisition was integral to Associated's results in the quarter. With the merger closing on February 1, we added $1.9 billion of loans and $1.8 billion of deposits to our franchise. The integration is going well and we look forward to introducing Bank Mutual customers to Associated's products and services over the next few months," said President and CEO Philip B. Flynn. “In the first quarter, credit dynamics continued to be favorable and fee income increased. Our conversations with customers have been upbeat, and our growth outlook is optimistic."

FIRST QUARTER 2018 SUMMARY (all comparisons to the first quarter of 2017)


•	Average loans of $22.1 billion were up 10%, or $2.0 billion


•	Average deposits of $23.7 billion were up 10%, or $2.2 billion


•	Net interest income of $210 million increased $30 million, or 16%


•	Net interest margin of 2.92% improved 8 basis points from 2.84%


•	Provision for credit losses was zero, down from $9 million


•	Noninterest income of $90 million was up $11 million, or 13%


•	Noninterest expense of $213 million was up $39 million and included $21 million of acquisition related costs


•	Income before income taxes was up 13%, or $10 million


•	During the quarter, the Company repurchased approximately 1.1 million shares, or $26 million, of common stock


•	Total dividends paid per common share were $0.15, up 25%

¹This is a non-GAAP financial measure. Management believes these measures are meaningful because they reflect adjustments commonly made by management, investors, regulators, and analysts to evaluate the adequacy of earnings per common share, provide greater understanding of ongoing operations and enhance comparability of results with prior periods. See page 8 of the attached tables for a reconciliation of GAAP financial measures to non-GAAP financial measures which exclude acquisition related costs.

Loans

First quarter 2018 average loans of $22.1 billion were up 10%, or $2.0 billion from the first quarter of 2017 and were up $1.2 billion from the fourth quarter of 2017. The Bank Mutual acquisition added $1.9 billion of loans.

With respect to first quarter 2018 average balances by loan category:


•	Consumer lending increased $1.5 billion from the year ago quarter, driven by the Company's on balance sheet mortgage retention strategy, and grew $554 million from the fourth quarter of 2017 to $9.4 billion.


•	Commercial real estate lending increased $399 million from the first quarter of 2017 and increased $526 million from the fourth quarter of 2017 to $5.4 billion.


•	Commercial and business lending increased $114 million from the year ago quarter and increased $135 million from the fourth quarter of 2017 to $7.3 billion. Mortgage Warehouse loan balances decreased approximately $50 million year over year and were down approximately $100 million from the prior quarter due to seasonal factors and higher mortgage interest rates.

Deposits

First quarter 2018 average deposits of $23.7 billion were up $2.2 billion, or 10% from the year ago quarter and were up $1.4 billion, or 6% from the fourth quarter of 2017. The Bank Mutual acquisition supplied $1.8 billion of deposits.

With respect to first quarter 2018 average balances by deposit category:


•	Noninterest-bearing demand deposits increased $119 million from the year ago quarter, but decreased $49 million from the fourth quarter of 2017 to $5.1 billion.


•	Savings and time deposits increased $1.4 billion from the year ago quarter and increased $528 million from the fourth quarter of 2017 to $4.4 billion.


•	Interest-bearing demand deposits increased $461 million from the year ago quarter and increased $249 million from the fourth quarter of 2017 to $4.7 billion.


•	Money market deposits increased $247 million from the year ago quarter and increased $672 million from the fourth quarter of 2017 to $9.4 billion.

Net Interest Income and Net Interest Margin

First quarter 2018 net interest income of $210 million was up 16%, or $30 million from the year ago quarter, with net interest margin increasing 8 basis points to 2.92%. First quarter 2018 net interest income increased 12%, or $23 million from the fourth quarter of 2017.


•	The average yield on total commercial loans for the first quarter of 2018 increased 82 basis points to 4.34% from the year ago quarter and increased 45 basis points from the prior quarter.


•	The average cost of total interest-bearing deposits for the first quarter of 2018 increased 31 basis points to 0.73% from the year ago quarter and increased 8 basis points from the prior quarter.


•	The net free funds benefit, the benefit of holding noninterest-bearing demand deposits, increased 6 basis points in the first quarter of 2018 compared to the year ago quarter and remained unchanged from the prior quarter.


•	Net loan and deposit growth for the first quarter of 2018, including the Bank Mutual acquisition, contributed an additional $10 million of net interest income compared to fourth quarter 2017.


•	Accreted income from the acquired Bank Mutual loan portfolio contributed $6 million to net interest income for the first quarter of 2018. Approximately $2 million of the accreted income was from prepayments and other adjustments.


•	Net changes in the securities portfolio for the first quarter of 2018 added $3 million to net interest income. LIBOR - Fed Funds and other net changes to earning assets and liabilities contributed $4 million to net interest income.

Noninterest Income

First quarter 2018 total noninterest income of $90 million increased $11 million from the year ago quarter and increased $6 million from the prior quarter.

With respect to first quarter 2018 noninterest income line items:


•	Brokerage and asset management fees were up $3 million from the year ago quarter, primarily driven by the acquisition of Whitnell & Co., and were up slightly from the prior quarter.


•	Capital market fees increased $1 million from the year ago quarter, but decreased $2 million from a very strong fourth quarter of 2017.


•	Mortgage banking income increased $2 million from the year ago quarter and increased $3 million from the prior quarter as the Company completed its mortgage retention initiative and returned to selling newly originated mortgage loans.

Noninterest Expense

First quarter 2018 total noninterest expense of $213 million increased 23%, or $39 million from the year ago quarter and increased $31 million from the fourth quarter of 2017. First quarter 2018 noninterest expense includes $21 million of Bank Mutual acquisition related costs.

With respect to first quarter 2018 noninterest expense line items:


•	Personnel expense increased by $11 million from both the year ago quarter and the fourth quarter of 2017, primarily driven by the additional cost of Bank Mutual staff.


•	Technology expense increased $3 million from the year ago quarter, but was unchanged from the prior quarter.


•	Occupancy expense was essentially unchanged from the year ago quarter, but increased $2 million from the prior quarter, with most of the increase coming from the additional expense of acquired Bank Mutual facilities.

Taxes

The first quarter 2018 effective tax rate was 20% compared to 27% in the year ago quarter. The decrease is primarily due to the Tax Cut and Jobs Act signed into law on December 22, 2017. The Company continues to expect its 2018 effective tax rate to be in the range of 20%-22%.

Credit

The first quarter provision for credit losses was zero, down from $9 million from the year ago quarter and unchanged from the prior quarter.

With respect to first quarter 2018 credit quality:


•	Potential problem loans of $282 million, including $42 million of loans from the Bank Mutual acquisition, were down $57 million from the year ago quarter, but were up $105 million from the prior quarter.


•	Nonaccrual loans of $209 million, including $15 million of purchased credit-impaired loans from the Bank Mutual acquisition, were down $51 million from the year ago quarter and were unchanged from the prior quarter. The nonaccrual loans to total loans ratio was 0.91% in the first quarter, compared to 1.29% in the year ago quarter, and 1.00% in the prior quarter.


•	Net charge offs of $9 million were up $4 million from the year ago quarter, but were down $1 million from the prior quarter. Oil and gas charge offs were $4 million in the first quarter.


•	The allowance for loan losses of $257 million was down $26 million from the year ago quarter and was down $9 million from the prior quarter. The allowance for loan losses to total loans ratio was 1.13% in the first quarter of 2018, compared to 1.40% in the year ago quarter, and 1.28% in the prior quarter.


•	The allowance related to the oil and gas portfolio was $19 million at March 31, 2018 and represented 2.9% of total oil and gas loans compared to 6.7% in the year ago quarter, and 4.5% in the prior quarter.

Capital

The Company’s capital position remains strong, with a CET1 capital ratio of 10.5% at March 31, 2018. The Company’s capital ratios continue to be in excess of the Basel III “well-capitalized” regulatory benchmarks on a fully phased in basis.

During the quarter, the Company repurchased approximately 1.1 million shares, or $26 million, of common stock, at an average price of $23.90 per share.

FIRST QUARTER 2018 EARNINGS RELEASE CONFERENCE CALL

The Company will host a conference call for investors and analysts at 4:00 p.m. Central Time (CT) today, April 19, 2018. Interested parties can access the live webcast of the call through the Investor Relations section of the Company's website, http://investor.associatedbank.com. Parties may also dial into the call at 877-407-8037 (domestic) or 201-689-8037 (international) and request the Associated Banc-Corp first quarter 2018 earnings call. The first quarter 2018 financial tables with an accompanying slide presentation will be available on the Company's website just prior to the call. An audio archive of the webcast will be available on the Company's website approximately fifteen minutes after the call is over.

ABOUT ASSOCIATED BANC-CORP

Associated Banc-Corp (NYSE: ASB) has total assets of $33 billion and is one of the top 50 publicly traded U.S. bank holding companies. Headquartered in Green Bay, Wisconsin, Associated is a leading Midwest banking franchise, offering a full range of financial products and services from more than 270 banking locations serving more than 110 communities throughout Wisconsin, Illinois and Minnesota, and commercial financial services in Indiana, Michigan, Missouri, Ohio and Texas. Associated Bank, N.A. is an Equal Housing Lender, Equal Opportunity Lender and Member FDIC. More information about Associated Banc-Corp is available at www.associatedbank.com.

FORWARD-LOOKING STATEMENTS

Statements made in this document which are not purely historical are forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. This includes any statements regarding management’s plans, objectives, or goals for future operations, products or services, and forecasts of its revenues, earnings, or other measures of performance. Such forward-looking statements may be identified by the use of words such as “believe,” “expect,” “anticipate,” “plan,” “estimate,” “should,” “will,” “intend,” “outlook,” or similar expressions. Forward-looking statements are based on current management expectations and, by their nature, are subject to risks and uncertainties. Actual results may differ materially from those contained in the forward-looking statements. Factors which may cause actual results to differ materially from those contained in such forward-looking statements include those identified in the Company’s most recent Form 10-K and subsequent SEC filings. Such factors are incorporated herein by reference.

NON-GAAP FINANCIAL MEASURES

This press release and related materials may contain references to measures which are not defined in generally accepted accounting principles (“GAAP”). Information concerning these non-GAAP financial measures can be found in the financial tables. Management believes these measures are meaningful because they reflect adjustments commonly made by management, investors, regulators, and analysts to evaluate the adequacy of earnings per common share, provide a greater understanding of ongoing operations and enhance comparability of results with prior periods.

# # #



Associated Banc-Corp Consolidated Balance Sheets (Unaudited)
(In thousands)	Mar 31, 2018			Dec 31, 2017			Seql Qtr $ Change			Sep 30, 2017			Jun 30, 2017			Mar 31, 2017			Comp Qtr $ Change
Assets
Cash and due from banks	$	328,260		$	483,666		$	(155,406	)	$	354,331		$	396,677		$	332,601		$	(4,341	)
Interest-bearing deposits in other financial institutions	94,918			199,702			(104,784		)	109,596			126,232			337,167			(242,249		)
Federal funds sold and securities purchased under agreements to resell	10,000			32,650			(22,650		)	27,700			43,000			19,700			(9,700		)
Investment securities held to maturity, at amortized cost	2,443,203			2,282,853			160,350			2,233,579			2,255,395			1,554,843			888,360
Investment securities available for sale, at fair value	4,485,875			4,043,446			442,429			3,801,699			3,687,470			4,300,490			185,385
Federal Home Loan Bank and Federal Reserve Bank stocks, at cost	233,216			165,331			67,885			172,446			181,180			139,273			93,943
Residential loans held for sale	103,953			85,544			18,409			113,064			41,620			34,051			69,902
Commercial loans held for sale	6,091			—			6,091			9,718			4,772			2,901			3,190
Loans	22,810,491			20,784,991			2,025,500			20,931,460			20,783,069			20,147,683			2,662,808
Allowance for loan losses	(257,058		)	(265,880		)	8,822			(276,551		)	(281,101		)	(282,672		)	25,614
Loans, net	22,553,433			20,519,111			2,034,322			20,654,909			20,501,968			19,865,011			2,688,422
Bank and corporate owned life insurance	657,841			591,057			66,784			589,093			588,440			587,600			70,241
Tax credit and other investments	142,368			147,099			(4,731		)	120,927			95,710			92,675			49,693
Trading assets	102,890			69,675			33,215			48,429			48,576			49,306			53,584
Premises and equipment	381,327			330,963			50,364			330,065			328,404			332,884			48,443
Goodwill	1,153,156			976,239			176,917			972,006			972,006			972,006			181,150
Mortgage servicing rights, net	66,407			58,384			8,023			58,377			59,395			60,702			5,705
Other intangible assets, net	79,714			15,580			64,134			14,080			14,530			15,026			64,688
Other assets	523,855			482,294			41,561			454,528			423,650			413,621			110,234
Total assets	$	33,366,505		$	30,483,594		$	2,882,911		$	30,064,547		$	29,769,025		$	29,109,857		$	4,256,648
Liabilities and stockholders’ equity
Noninterest-bearing demand deposits	$	5,458,473		$	5,478,416		$	(19,943	)	$	5,177,734		$	5,038,162		$	5,338,212		$	120,261
Interest-bearing deposits	18,367,129			17,307,546			1,059,583			17,155,717			16,580,018			16,489,823			1,877,306
Total deposits	23,825,602			22,785,962			1,039,640			22,333,451			21,618,180			21,828,035			1,997,567
Federal funds purchased and securities sold under agreements to repurchase	283,954			324,815			(40,861		)	476,550			607,669			650,188			(366,234		)
Other short-term funding	1,862,420			351,467			1,510,953			588,067			794,813			430,679			1,431,741
Long-term funding	3,233,338			3,397,450			(164,112		)	3,147,285			3,262,120			2,761,955			471,383
Trading liabilities	100,247			67,660			32,587			46,812			47,143			47,561			52,686
Accrued expenses and other liabilities	348,246			318,797			29,449			268,781			247,598			246,645			101,601
Total liabilities	29,653,806			27,246,151			2,407,655			26,860,946			26,577,523			25,965,063			3,688,743
Stockholders’ equity
Preferred equity	159,853			159,929			(76		)	159,929			159,929			159,929			(76		)
Common equity
Common stock	1,741			1,618			123			1,615			1,630			1,630			111
Surplus	1,823,800			1,454,188			369,612			1,442,328			1,474,301			1,469,744			354,056
Retained earnings	1,859,068			1,819,230			39,838			1,792,184			1,747,632			1,709,514			149,554
Accumulated other comprehensive income (loss)	(107,673		)	(62,758		)	(44,915		)	(54,288		)	(53,470		)	(56,344		)	(51,329		)
Treasury stock, at cost	(24,089		)	(134,764		)	110,675			(138,167		)	(138,520		)	(139,679		)	115,590
Total common equity	3,552,847			3,077,514			475,333			3,043,672			3,031,573			2,984,865			567,982
Total stockholders’ equity	3,712,699			3,237,443			475,256			3,203,601			3,191,502			3,144,794			567,905
Total liabilities and stockholders’ equity	$	33,366,505		$	30,483,594		$	2,882,911		$	30,064,547		$	29,769,025		$	29,109,857		$	4,256,648

Numbers may not add due to rounding.

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Associated Banc-Corp Consolidated Statements of Income (Unaudited) - Quarterly Trend
(In thousands, except per share data)							Seql Qtr														Comp Qtr
(In thousands, except per share data)	1Q18			4Q17			$ Change			% Change		3Q17			2Q17			1Q17			$ Change			% Change
Interest income
Interest and fees on loans	$	220,034		$	194,133		$	25,901		13	%	$	196,972		$	184,246		$	173,649		$	46,385		27	%
Interest and dividends on investment securities
Taxable	30,104			25,614			4,490			18	%	24,162			23,658			23,475			6,629			28	%
Tax-exempt	9,217			8,437			780			9	%	8,268			8,143			8,129			1,088			13	%
Other interest	2,177			2,138			39			2	%	2,492			1,553			1,536			641			42	%
Total interest income	261,532			230,322			31,210			14	%	231,894			217,600			206,789			54,743			26	%
Interest expense
Interest on deposits	33,412			28,143			5,269			19	%	27,778			21,180			16,924			16,488			97	%
Interest on Federal funds purchased and securities sold under agreements to repurchase	522			420			102			24	%	768			824			515			7			1	%
Interest on other short-term funding	3,005			1,731			1,274			74	%	1,039			1,827			1,080			1,925			178	%
Interest on long-term funding	14,722			13,023			1,699			13	%	12,187			9,950			7,996			6,726			84	%
Total interest expense	51,661			43,317			8,344			19	%	41,772			33,781			26,515			25,146			95	%
Net Interest income	209,871			187,005			22,866			12	%	190,122			183,819			180,274			29,597			16	%
Provision for credit losses	—			—			—			—		5,000			12,000			9,000			(9,000		)	N/M
Net interest income after provision for credit losses	209,871			187,005			22,866			12	%	185,122			171,819			171,274			38,597			23	%
Noninterest income
Insurance commissions and fees	22,648			19,186			3,462			18	%	19,815			20,853			21,620			1,028			5	%
Service charges and deposit account fees	16,420			15,773			647			4	%	16,268			16,030			16,356			64			—	%
Card-based and loan fees	13,422			13,840			(418		)	(3	)%	12,619			13,764			12,465			957			8	%
Trust and asset management fees	13,369			13,125			244			2	%	12,785			12,346			11,935			1,434			12	%
Brokerage commissions and fees	7,273			6,864			409			6	%	4,392			4,346			4,333			2,940			68	%
Mortgage banking, net	6,370			3,169			3,201			101	%	6,585			5,027			4,579			1,791			39	%
Capital markets, net	5,306			7,107			(1,801		)	(25	)%	4,610			4,042			3,883			1,423			37	%
Bank and corporate owned life insurance	3,187			3,156			31			1	%	6,580			3,899			2,615			572			22	%
Asset gains (losses), net	(107		)	(528		)	421			(80	)%	(16		)	(466		)	(234		)	127			(54	)%
Investment securities gains (losses), net	—			75			(75		)	N/M		3			356			—			—			N/M
Other	2,492			2,777			(285		)	(10	)%	2,254			2,213			2,279			213			9	%
Total noninterest income	90,380			84,544			5,836			7	%	85,895			82,410			79,831			10,549			13	%
Noninterest expense
Personnel ⁽¹⁾	117,685			107,031			10,654			10	%	108,098			107,066			106,782			10,903			10	%
Occupancy	15,357			13,497			1,860			14	%	12,294			12,832			15,219			138			1	%
Technology	17,715			17,878			(163		)	(1	)%	15,233			15,473			14,420			3,295			23	%
Equipment	5,556			5,250			306			6	%	5,232			5,234			5,485			71			1	%
Business development and advertising	6,693			8,195			(1,502		)	(18	)%	7,764			7,152			5,835			858			15	%
Legal and professional	5,413			6,384			(971		)	(15	)%	6,248			5,711			4,166			1,247			30	%
Card issuance and loan costs	3,304			2,836			468			17	%	3,330			2,974			2,620			684			26	%
Foreclosure / OREO expense, net	723			1,285			(562		)	(44	)%	906			1,182			1,505			(782		)	(52	)%
FDIC assessment	8,250			7,500			750			10	%	7,800			8,000			8,000			250			3	%
Other intangible amortization	1,525			500			1,025			205	%	450			496			513			1,012			197	%
Acquisition related costs ⁽²⁾	20,605			—			20,605			N/M		—			—			—			20,605			N/M
Other ⁽¹⁾	10,140			11,343			(1,203		)	(11	)%	10,072			10,196			9,146			994			11	%
Total noninterest expense	212,965			181,699			31,266			17	%	177,427			176,316			173,691			39,274			23	%
Income before income taxes	87,285			89,850			(2,565		)	(3	)%	93,590			77,913			77,414			9,871			13	%
Income tax expense	17,829			39,840			(22,011		)	(55	)%	28,589			19,930			21,144			(3,315		)	(16	)%
Net income	69,456			50,010			19,446			39	%	65,001			57,983			56,270			13,186			23	%
Preferred stock dividends	2,339			2,339			—			—	%	2,339			2,339			2,330			9			—	%
Net income available to common equity	$	67,117		$	47,671		$	19,446		41	%	$	62,662		$	55,644		$	53,940		$	13,177		24	%
Earnings per common share
Basic	$	0.41		$	0.31		$	0.10		32	%	$	0.41		$	0.36		$	0.36		$	0.05		14	%
Diluted	$	0.40		$	0.31		$	0.09		29	%	$	0.41		$	0.36		$	0.35		$	0.05		14	%
Average common shares outstanding
Basic	163,520			150,563			12,957			9	%	150,565			151,573			150,815			12,705			8	%
Diluted	166,432			153,449			12,983			8	%	152,968			154,302			153,869			12,563			8	%

N/M = Not meaningful

Numbers may not add due to rounding.

(1) During the first quarter of 2018, the Corporation adopted a new accounting standard related to the presentation of net periodic pension cost and net periodic postretirement benefit cost which required the disaggregation of the service cost component from the other components of net benefit cost and net periodic postretirement benefit cost. Under this new accounting standard, the other components of net benefit cost and net periodic postretirement benefit cost were reclassified from personnel expense to other noninterest expense. All prior periods have been restated to reflect this change in presentation.


(2)	Includes Bank Mutual acquisition related costs only.

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Associated Banc-Corp Selected Quarterly Information
(In millions, except share and per share, full time equivalent employee and branch count data)	1Q18			4Q17			3Q17			2Q17			1Q17
Per common share data
Dividends	$	0.15		$	0.14		$	0.12		$	0.12		$	0.12
Market value:
High	26.90			26.10			25.70			25.50			26.50
Low	23.60			24.00			21.25			23.25			23.40
Close	24.85			25.40			24.25			25.20			24.40
Book value	20.63			20.13			19.98			19.70			19.42
Tangible book value / share	$	13.47		$	13.65		$	13.51		$	13.29		$	13.00
Performance ratios (annualized)
Return on average assets	0.88		%	0.66		%	0.86		%	0.80		%	0.79		%
Effective tax rate	20.43		%	44.34		%	30.55		%	25.58		%	27.31		%
Dividend payout ratio ⁽¹⁾	36.59		%	45.16		%	29.27		%	33.33		%	33.33		%
Net interest margin	2.92		%	2.79		%	2.84		%	2.83		%	2.84		%
Selected trend information
Average full time equivalent employees	4,693			4,367			4,384			4,352			4,370
Branch count	271			213			214			214			215
Assets under management, at market value ⁽²⁾	$	10,540		$	10,555		$	9,243		$	8,997		$	8,716
Mortgage loans originated for sale during period	$	198		$	249		$	246		$	119		$	101
Mortgage loan settlements during period	$	188		$	268		$	188		$	167		$	197
Mortgage portfolio serviced for others	$	8,507		$	7,647		$	7,653		$	7,768		$	7,909
Mortgage servicing rights, net / mortgage portfolio serviced for others	0.78		%	0.76		%	0.76		%	0.76		%	0.77		%
Shares outstanding, end of period	172,182			152,846			152,316			153,848			153,734
Net shares issuable to Associated Banc-Corp warrant ("ASBWS") holders ⁽⁵⁾	1,023			1,134			903			1,094			933
Selected quarterly ratios
Loans / deposits	95.74		%	91.22		%	93.72		%	96.14		%	92.30		%
Stockholders’ equity / assets	11.13		%	10.62		%	10.66		%	10.72		%	10.80		%
Risk-based capital ^{(3) (4)}
Total risk-weighted assets	$	23,550		$	21,544		$	21,657		$	21,590		$	21,129
Common equity Tier 1	$	2,474		$	2,172		$	2,144		$	2,130		$	2,085
Common equity Tier 1 capital ratio	10.50		%	10.08		%	9.90		%	9.87		%	9.87		%
Tier 1 capital ratio	11.18		%	10.82		%	10.64		%	10.61		%	10.62		%
Total capital ratio	13.44		%	13.22		%	13.04		%	13.01		%	13.05		%
Tier 1 leverage ratio	8.48		%	8.02		%	7.93		%	8.09		%	8.05		%
Loans
Recorded investment on loans	$	22,756		$	20,699		$	20,849		$	20,708		$	20,086
Net unaccreted Bank Mutual purchase discount	(34		)	—			—			—			—
Net other deferred costs	88			86			83			75			62
Loans	$	22,810		$	20,785		$	20,931		$	20,783		$	20,148

Numbers may not add due to rounding.


(1)	Ratio is based upon basic earnings per common share.


(2)	Excludes assets held in brokerage accounts.


(3)	The Federal Reserve establishes regulatory capital requirements, including well-capitalized standards for the Corporation. The regulatory capital requirements effective for the Corporation follow Basel III, subject to certain transition provisions.


(4)	March 31, 2018 data is estimated.


(5)	Based on the treasury stock method and the period-end close price. The ASBWS warrants will expire on November 21, 2018.

Page 3



Associated Banc-Corp Selected Asset Quality Information
(In thousands)	Mar 31, 2018			Dec 31, 2017			Seql Qtr % Change		Sep 30, 2017			Jun 30, 2017			Mar 31, 2017			Comp Qtr % Change
Allowance for loan losses
Balance at beginning of period	$	265,880		$	276,551		(4	)%	$	281,101		$	282,672		$	278,335		(4	)%
Provision for loan losses	500			—			N/M		6,000			11,000			10,000			(95	)%
Charge offs	(12,155		)	(14,289		)	(15	)%	(14,727		)	(15,376		)	(11,854		)	3	%
Recoveries	2,832			3,618			(22	)%	4,177			2,805			6,191			(54	)%
Net charge offs	(9,323		)	(10,671		)	(13	)%	(10,550		)	(12,571		)	(5,663		)	65	%
Balance at end of period	$	257,058		$	265,880		(3	)%	$	276,551		$	281,101		$	282,672		(9	)%
Allowance for unfunded commitments
Balance at beginning of period	$	24,400		$	24,400		—	%	$	25,400		$	24,400		$	25,400		(4	)%
Provision for unfunded commitments	(500		)	—			N/M		(1,000		)	1,000			(1,000		)	(50	)%
Amount recorded at acquisition	2,436			—			N/M		—			—			—			N/M
Balance at end of period	$	26,336		$	24,400		8	%	$	24,400		$	25,400		$	24,400		8	%
Allowance for credit losses	$	283,394		$	290,280		(2	)%	$	300,951		$	306,501		$	307,072		(8	)%
Provision for credit losses	$	—		$	—		N/M		$	5,000		$	12,000		$	9,000		(100	)%
	Mar 31, 2018			Dec 31, 2017			Seql Qtr % Change		Sep 30, 2017			Jun 30, 2017			Mar 31, 2017			Comp Qtr % Change
Net charge offs
Commercial and industrial	$	(6,599	)	$	(8,212	)	(20	)%	$	(9,442	)	$	(11,046	)	$	(4,368	)	51	%
Commercial real estate—owner occupied	(1,025		)	(246		)	N/M		13			43			19			N/M
Commercial and business lending	(7,624		)	(8,458		)	(10	)%	(9,429		)	(11,003		)	(4,349		)	75	%
Commercial real estate—investor	8			(164		)	(105	)%	55			(126		)	(514		)	(102	)%
Real estate construction	189			(365		)	(152	)%	(150		)	(26		)	11			N/M
Commercial real estate lending	197			(529		)	(137	)%	(95		)	(152		)	(503		)	(139	)%
Total commercial	(7,427		)	(8,987		)	(17	)%	(9,524		)	(11,155		)	(4,852		)	53	%
Residential mortgage	(131		)	(966		)	(86	)%	(26		)	(564		)	(128		)	2	%
Home equity	(677		)	330			N/M		(87		)	54			173			N/M
Other consumer	(1,088		)	(1,048		)	4	%	(913		)	(906		)	(856		)	27	%
Total consumer	(1,896		)	(1,684		)	13	%	(1,026		)	(1,416		)	(811		)	134	%
Total net charge offs	$	(9,323	)	$	(10,671	)	(13	)%	$	(10,550	)	$	(12,571	)	$	(5,663	)	65	%

(In basis points)	Mar 31, 2018			Dec 31, 2017					Sep 30, 2017			Jun 30, 2017			Mar 31, 2017
Net charge offs to average loans (annualized)
Commercial and industrial	(41		)	(51		)			(58		)	(69		)	(28		)
Commercial real estate—owner occupied	(48		)	(12		)			1			2			1
Commercial and business lending	(42		)	(47		)			(51		)	(60		)	(24		)
Commercial real estate—investor	N/M			(2		)			1			(2		)	(6		)
Real estate construction	5			(10		)			(4		)	(1		)	N/M
Commercial real estate lending	1			(4		)			(1		)	(1		)	(4		)
Total commercial	(24		)	(30		)			(31		)	(36		)	(16		)
Residential mortgage	(1		)	(5		)			N/M			(3		)	(1		)
Home equity	(28		)	15					(4		)	2			8
Other consumer	(115		)	(109		)			(97		)	(98		)	(90		)
Total consumer	(8		)	(8		)			(5		)	(7		)	(4		)
Total net charge offs	(17		)	(20		)			(20		)	(25		)	(11		)

(In thousands)	Mar 31, 2018			Dec 31, 2017			Seql Qtr % Change		Sep 30, 2017			Jun 30, 2017			Mar 31, 2017			Comp Qtr % Change
Credit Quality
Nonaccrual loans	$	208,553		$	208,546		—	%	$	210,517		$	231,888		$	259,991		(20	)%
Other real estate owned (OREO)	16,919			12,608			34	%	8,483			7,782			7,540			124	%
Other nonperforming assets	7,117			7,418			(4	)%	7,418			7,418			7,418			(4	)%
Total nonperforming assets	$	232,589		$	228,572		2	%	$	226,418		$	247,088		$	274,949		(15	)%

Loans 90 or more days past due and still accruing	$	3,393		$	1,867		82	%	$	1,611		$	1,535		$	1,720		97	%
Allowance for loan losses to loans	1.13		%	1.28		%			1.32		%	1.35		%	1.40		%
Net unaccreted purchase discount to purchased loans	1.80		%	—		%			—		%	—		%	—		%
Allowance for loan losses to nonaccrual loans	123.26		%	127.49		%			131.37		%	121.22		%	108.72		%
Nonaccrual loans to total loans	0.91		%	1.00		%			1.01		%	1.12		%	1.29		%
Nonperforming assets to total loans plus OREO	1.02		%	1.10		%			1.08		%	1.19		%	1.36		%
Nonperforming assets to total assets	0.70		%	0.75		%			0.75		%	0.83		%	0.94		%
Year-to-date net charge offs to average loans (annualized)	0.17		%	0.19		%			0.19		%	0.18		%	0.11		%

Page 4



Associated Banc-Corp Selected Asset Quality Information (continued)
(In thousands)	Mar 31, 2018		Dec 31, 2017		Seql Qtr % Change		Sep 30, 2017		Jun 30, 2017		Mar 31, 2017		Comp Qtr % Change
Nonaccrual loans
Commercial and industrial	$	102,667	$	112,786	(9	)%	$	122,284	$	141,475	$	164,891	(38	)%
Commercial real estate—owner occupied	20,636		22,740		(9	)%	15,598		15,800		17,925		15	%
Commercial and business lending	123,303		135,526		(9	)%	137,882		157,275		182,816		(33	)%
Commercial real estate—investor	15,574		4,729		N/M		3,543		7,206		8,273		88	%
Real estate construction	1,219		974		25	%	1,540		1,717		1,247		(2	)%
Commercial real estate lending	16,793		5,703		194	%	5,083		8,923		9,520		76	%
Total commercial	140,096		141,229		(1	)%	142,965		166,198		192,336		(27	)%
Residential mortgage	55,100		53,632		3	%	54,654		51,975		54,183		2	%
Home equity	13,218		13,514		(2	)%	12,639		13,482		13,212		—	%
Other consumer	139		171		(19	)%	259		233		260		(47	)%
Total consumer	68,456		67,317		2	%	67,552		65,690		67,655		1	%
Total nonaccrual loans	$	208,553	$	208,546	—	%	$	210,517	$	231,888	$	259,991	(20	)%

	Mar 31, 2018		Dec 31, 2017		Seql Qtr % Change		Sep 30, 2017		Jun 30, 2017		Mar 31, 2017		Comp Qtr % Change
Restructured loans (accruing)
Commercial and industrial	$	29,580	$	30,047	(2	)%	$	32,572	$	31,540	$	30,852	(4	)%
Commercial real estate—owner occupied	3,892		3,989		(2	)%	4,077		4,145		5,532		(30	)%
Commercial and business lending	33,472		34,036		(2	)%	36,649		35,685		36,384		(8	)%
Commercial real estate—investor	13,683		14,389		(5	)%	14,294		14,628		14,563		(6	)%
Real estate construction	305		310		(2	)%	316		321		327		(7	)%
Commercial real estate lending	13,988		14,699		(5	)%	14,610		14,949		14,890		(6	)%
Total commercial	47,460		48,735		(3	)%	51,259		50,634		51,274		(7	)%
Residential mortgage	19,902		17,068		17	%	16,859		17,624		18,535		7	%
Home equity	8,098		7,705		5	%	7,987		7,985		8,209		(1	)%
Other consumer	1,041		1,110		(6	)%	1,073		1,082		1,041		—	%
Total consumer	29,041		25,883		12	%	25,919		26,691		27,785		5	%
Total restructured loans (accruing)	$	76,501	$	74,618	3	%	$	77,178	$	77,325	$	79,059	(3	)%
Restructured loans included in nonaccrual loans (not included with restructured loans (accruing))	$	23,827	$	23,486	1	%	$	33,520	$	51,715	$	78,902	(70	)%
	Mar 31, 2018		Dec 31, 2017		Seql Qtr % Change		Sep 30, 2017		Jun 30, 2017		Mar 31, 2017		Comp Qtr % Change
Accruing Loans 30-89 Days Past Due
Commercial and industrial	$	880	$	271	N/M		$	1,378	$	1,255	$	1,675	(47	)%
Commercial real estate—owner occupied	511		48		N/M		1,522		1,284		970		(47	)%
Commercial and business lending	1,391		319		N/M		2,900		2,539		2,645		(47	)%
Commercial real estate—investor	240		374		(36	)%	1,109		899		1,122		(79	)%
Real estate construction	490		251		95	%	700		135		431		14	%
Commercial real estate lending	730		625		17	%	1,809		1,034		1,553		(53	)%
Total commercial	2,121		944		125	%	4,709		3,573		4,198		(49	)%
Residential mortgage	15,133		9,552		58	%	8,870		9,165		7,243		109	%
Home equity	5,868		6,825		(14	)%	7,191		5,924		4,512		30	%
Other consumer	1,811		2,007		(10	)%	1,686		1,746		1,658		9	%
Total consumer	22,812		18,384		24	%	17,747		16,835		13,413		70	%
Total accruing loans 30-89 days past due	$	24,934	$	19,328	29	%	$	22,456	$	20,408	$	17,611	42	%

	Mar 31, 2018		Dec 31, 2017		Seql Qtr % Change		Sep 30, 2017		Jun 30, 2017		Mar 31, 2017		Comp Qtr % Change
Potential Problem Loans
Commercial and industrial	$	196,766	$	113,778	73	%	$	153,779	$	142,607	$	218,930	(10	)%
Commercial real estate—owner occupied	34,410		41,997		(18	)%	57,468		60,724		58,994		(42	)%
Commercial and business lending	231,176		155,775		48	%	211,247		203,331		277,924		(17	)%
Commercial real estate—investor	46,970		19,291		143	%	46,770		48,569		49,217		(5	)%
Real estate construction	1,695		—		N/M		118		8,901		10,141		(83	)%
Commercial real estate lending	48,665		19,291		152	%	46,888		57,470		59,358		(18	)%
Total commercial	279,841		175,066		60	%	258,135		260,801		337,282		(17	)%
Residential mortgage	2,155		1,616		33	%	650		1,576		2,155		—	%
Home equity	188		195		(4	)%	124		208		220		(15	)%
Total consumer	2,343		1,811		29	%	774		1,784		2,375		(1	)%
Total potential problem loans	$	282,184	$	176,877	60	%	$	258,909	$	262,585	$	339,657	(17	)%

N/M = Not meaningful

Numbers may not add due to rounding.

Page 5



Associated Banc-Corp Net Interest Income Analysis - Fully Tax-Equivalent Basis - Sequential and Comparable Quarter
	Three Months Ended
	March 31, 2018						December 31, 2017						March 31, 2017
(In thousands)	Average Balance		Interest Income /Expense		Average Yield /Rate		Average Balance		Interest Income /Expense		Average Yield /Rate		Average Balance		Interest Income /Expense		Average Yield /Rate
Assets
Earning assets
Loans^{(1) (2) (3)}
Commercial and business lending	$	7,313,621	$	74,706	4.14	%	$	7,178,384	$	68,440	3.79	%	$	7,199,481	$	60,680	3.42	%
Commercial real estate lending	5,399,429		61,504		4.62	%	4,873,889		49,744		4.05	%	4,999,994		45,135		3.66	%
Total commercial	12,713,050		136,210		4.34	%	12,052,273		118,184		3.89	%	12,199,475		105,815		3.52	%
Residential mortgage	8,010,381		66,402		3.32	%	7,546,288		59,979		3.18	%	6,564,600		53,306		3.25	%
Retail	1,355,098		17,852		5.29	%	1,265,055		16,853		5.31	%	1,308,650		15,450		4.74	%
Total loans	22,078,529		220,464		4.03	%	20,863,616		195,016		3.72	%	20,072,725		174,571		3.51	%
Investment securities
Taxable	5,576,826		30,104		2.16	%	4,986,279		25,614		2.05	%	4,830,421		23,475		1.94	%
Tax-exempt ⁽¹⁾	1,312,913		11,613		3.54	%	1,206,078		12,909		4.28	%	1,138,010		12,438		4.37	%
Other short-term investments	313,864		2,177		2.80	%	382,762		2,138		2.22	%	298,158		1,536		2.08	%
Investments and other	7,203,603		43,894		2.44	%	6,575,119		40,661		2.47	%	6,266,589		37,449		2.39	%
Total earning assets	29,282,132		$	264,358	3.64	%	27,438,735		$	235,677	3.42	%	26,339,314		$	212,020	3.24	%
Other assets, net	2,884,248						2,542,484						2,441,013
Total assets	$	32,166,380					$	29,981,219					$	28,780,327
Liabilities and stockholders' equity
Interest-bearing liabilities
Interest-bearing deposits
Savings	$	1,722,665	$	202	0.05	%	$	1,554,639	$	209	0.05	%	$	1,465,811	$	188	0.05	%
Interest-bearing demand	4,712,115		8,553		0.74	%	4,462,725		7,462		0.66	%	4,251,357		4,210		0.40	%
Money market	9,415,869		17,827		0.77	%	8,743,614		14,274		0.65	%	9,169,141		9,388		0.42	%
Time deposits	2,715,292		6,830		1.02	%	2,354,828		6,198		1.04	%	1,613,331		3,138		0.79	%
Total interest-bearing deposits	18,565,941		33,412		0.73	%	17,115,806		28,143		0.65	%	16,499,640		16,924		0.42	%
Federal funds purchased and securities sold under agreements to repurchase	275,578		522		0.77	%	279,817		420		0.60	%	495,311		515		0.42	%
Other short-term funding	884,633		3,005		1.38	%	600,492		1,731		1.14	%	683,306		1,080		0.64	%
Total short-term funding	1,160,211		3,527		1.23	%	880,309		2,151		0.97	%	1,178,617		1,595		0.55	%
Long-term funding	3,422,947		14,722		1.74	%	3,332,140		13,023		1.55	%	2,761,850		7,996		1.17	%
Total short and long-term funding	4,583,158		18,249		1.61	%	4,212,449		15,174		1.43	%	3,940,467		9,591		0.98	%
Total interest-bearing liabilities	23,149,099		$	51,661	0.90	%	21,328,255		$	43,317	0.81	%	20,440,107		$	26,515	0.52	%
Noninterest-bearing demand deposits	5,084,957						5,133,977						4,966,082
Other liabilities	395,008						302,981						250,747
Stockholders’ equity	3,537,316						3,216,006						3,123,391
Total liabilities and stockholders’ equity	$	32,166,380					$	29,981,219					$	28,780,327
Interest rate spread					2.74	%					2.61	%					2.72	%
Net free funds					0.18	%					0.18	%					0.12	%
Fully tax-equivalent net interest income and net interest margin ("NIM")			$	212,697	2.92	%			$	192,360	2.79	%			$	185,505	2.84	%
Fully tax-equivalent adjustment			2,826						5,355						5,231
Net interest income			$	209,871					$	187,005					$	180,274
Bank Mutual net accreted purchase loan discount			$	6,076					$	—					$	—

Numbers may not add due to rounding.


(1)	Beginning in 2018, the yield on tax-exempt loans and securities is computed on a fully tax-equivalent basis using a tax rate of 21% and is net of the effects of certain disallowed interest deductions. Prior to 2018, the yield on tax-exempt loans and securities was computed on a fully tax-equivalent basis using a tax rate of 35% and was net of the effects of certain disallowed interest deductions.


(2)	Nonaccrual loans and loans held for sale have been included in the average balances.


(3)	Interest income includes amortization of net deferred loan origination costs and net accreted purchase loan discount.

Page 6



Associated Banc-Corp Loan and Deposit Composition
(In thousands)	Mar 31, 2018		Dec 31, 2017		Seql Qtr % Change		Sep 30, 2017		Jun 30, 2017		Mar 31, 2017		Comp Qtr % Change
Period end loan composition ⁽³⁾
Commercial and industrial	$	6,756,983	$	6,399,693	6	%	$	6,534,660	$	6,571,000	$	6,300,646	7	%
Commercial real estate—owner occupied	900,913		802,209		12	%	827,064		845,336		878,391		3	%
Commercial and business lending	7,657,896		7,201,902		6	%	7,361,724		7,416,336		7,179,037		7	%
Commercial real estate—investor	4,077,671		3,315,254		23	%	3,345,536		3,329,585		3,415,355		19	%
Real estate construction	1,579,778		1,451,684		9	%	1,552,135		1,651,805		1,553,205		2	%
Commercial real estate lending	5,657,449		4,766,938		19	%	4,897,671		4,981,390		4,968,560		14	%
Total commercial	13,315,345		11,968,840		11	%	12,259,395		12,397,726		12,147,597		10	%
Residential mortgage	8,197,223		7,546,534		9	%	7,408,471		7,115,457		6,715,282		22	%
Home equity	923,470		883,804		4	%	890,130		897,111		911,969		1	%
Other consumer	374,453		385,813		(3	)%	373,464		372,775		372,835		—	%
Total consumer	9,495,146		8,816,151		8	%	8,672,065		8,385,343		8,000,086		19	%
Total loans	$	22,810,491	$	20,784,991	10	%	$	20,931,460	$	20,783,069	$	20,147,683	13	%
Purchased credit-impaired loans	$	14,838	$	—	N/M		$	—	$	—	$	—	N/M
Total loans excluding purchased credit-impaired loans	$	22,795,653	$	20,784,991	10	%	$	20,931,460	$	20,783,069	$	20,147,683	13	%

	Mar 31, 2018		Dec 31, 2017		Seql Qtr % Change		Sep 30, 2017		Jun 30, 2017		Mar 31, 2017		Comp Qtr % Change
Period end deposit and customer sweeps composition ⁽⁴⁾
Noninterest-bearing demand	$	5,458,473	$	5,478,416	—	%	$	5,177,734	$	5,038,162	$	5,338,212	2	%
Savings	1,883,638		1,524,992		24	%	1,544,037		1,552,820		1,530,155		23	%
Interest-bearing demand	4,719,566		4,603,157		3	%	4,990,891		3,858,739		4,736,236		—	%
Money market	9,086,553		8,830,328		3	%	8,299,512		9,228,129		8,608,523		6	%
Brokered CDs	44,503		18,609		139	%	3,554		131,184		54,993		(19	)%
Other time	2,632,869		2,330,460		13	%	2,317,723		1,809,146		1,559,916		69	%
Total deposits	23,825,602		22,785,962		5	%	22,333,451		21,618,180		21,828,035		9	%
Customer funding ⁽¹⁾	297,289		250,332		19	%	324,042		360,131		448,502		(34	)%
Total deposits and customer funding	$	24,122,891	$	23,036,294	5	%	$	22,657,493	$	21,978,311	$	22,276,537	8	%
Network transaction deposits ⁽²⁾	$	2,244,739	$	2,520,968	(11	)%	$	2,622,787	$	3,220,956	$	3,417,380	(34	)%
Net deposits and customer funding (Total deposits and customer sweeps, excluding Brokered CDs and network transaction deposits)	$	21,833,649	$	20,496,717	7	%	$	20,031,152	$	18,626,171	$	18,804,164	16	%

	Mar 31, 2018		Dec 31, 2017		Seql Qtr % Change		Sep 30, 2017		Jun 30, 2017		Mar 31, 2017		Comp Qtr % Change
Quarter average loan composition ⁽³⁾
Commercial and industrial	$	6,449,898	$	6,366,626	1	%	$	6,487,378	$	6,449,250	$	6,313,389	2	%
Commercial real estate—owner occupied	863,723		811,758		6	%	831,216		872,273		886,092		(3	)%
Commercial and business lending	7,313,621		7,178,384		2	%	7,318,594		7,321,523		7,199,481		2	%
Commercial real estate—investor	3,866,286		3,369,785		15	%	3,346,669		3,359,817		3,502,769		10	%
Real estate construction	1,533,143		1,504,104		2	%	1,626,767		1,604,440		1,497,225		2	%
Commercial real estate lending	5,399,429		4,873,889		11	%	4,973,436		4,964,257		4,999,994		8	%
Total commercial	12,713,050		12,052,273		5	%	12,292,030		12,285,780		12,199,475		4	%
Residential mortgage	8,010,381		7,546,288		6	%	7,339,827		6,957,865		6,564,600		22	%
Home equity	972,918		885,235		10	%	894,596		906,208		923,896		5	%
Other consumer	382,180		379,820		1	%	372,684		372,137		384,754		(1	)%
Total consumer	9,365,479		8,811,343		6	%	8,607,107		8,236,210		7,873,250		19	%
Total loans	$	22,078,529	$	20,863,616	6	%	$	20,899,137	$	20,521,990	$	20,072,725	10	%

	Mar 31, 2018		Dec 31, 2017		Seql Qtr % Change		Sep 30, 2017		Jun 30, 2017		Mar 31, 2017		Comp Qtr % Change
Quarter average deposit composition ⁽⁴⁾
Noninterest-bearing demand	$	5,084,957	$	5,133,977	(1	)%	$	4,992,118	$	4,892,271	$	4,966,082	2	%
Savings	1,722,665		1,554,639		11	%	1,545,884		1,541,129		1,465,811		18	%
Interest-bearing demand	4,712,115		4,462,725		6	%	4,347,550		4,272,620		4,251,357		11	%
Money market	9,415,869		8,743,614		8	%	9,367,907		9,064,874		9,169,141		3	%
Time deposits	2,715,292		2,354,828		15	%	2,187,986		1,752,255		1,613,331		68	%
Total deposits	$	23,650,898	$	22,249,783	6	%	$	22,441,445	$	21,523,149	$	21,465,722	10	%

N/M = Not meaningful

Numbers may not add due to rounding.


(1)	Includes repurchase agreements and commercial paper.

(2) Included above in interest-bearing demand and money market.

(3) On February 1, 2018, the Corporation acquired Bank Mutual and added $1.9 billion of loans.

(4) On February 1, 2018, the Corporation acquired Bank Mutual and assumed $1.8 billion of deposits.

Page 7



Associated Banc-Corp Non-GAAP Financial Measures Reconciliation
(In millions, except per share data)	1Q18			4Q17			3Q17			2Q17			1Q17
Tangible common equity reconciliation ⁽¹⁾
Common equity	$	3,553		$	3,078		$	3,044		$	3,032		$	2,985
Goodwill and other intangible assets, net	(1,233		)	(992		)	(986		)	(987		)	(987		)
Tangible common equity	$	2,320		$	2,086		$	2,058		$	2,045		$	1,998
Tangible assets reconciliation ⁽¹⁾
Total assets	$	33,367		$	30,484		$	30,065		$	29,769		$	29,110
Goodwill and other intangible assets, net	(1,233		)	(992		)	(986		)	(987		)	(987		)
Tangible assets	$	32,134		$	29,492		$	29,079		$	28,782		$	28,123
Average tangible common equity and average common equity tier 1 reconciliation⁽¹⁾
Common equity	$	3,377		$	3,056		$	3,025		$	3,005		$	2,963
Goodwill and other intangible assets, net	(1,108		)	(992		)	(986		)	(987		)	(987		)
Tangible common equity	2,269			2,064			2,039			2,018			1,976
Less: Accumulated other comprehensive income / loss	89			62			49			50			54
Less: Deferred tax assets / deferred tax liabilities, net	32			29			32			32			32
Average common equity Tier 1	$	2,390		$	2,155		$	2,120		$	2,100		$	2,062
Selected Trend Information ⁽²⁾
Insurance commissions and fees	$	23		$	19		$	20		$	21		$	22
Service charges and deposit account fees	16			16			16			16			16
Card-based and loan fees	13			14			13			14			13
Trust and asset management fees	13			13			13			12			12
Brokerage commissions and fees	7			7			4			4			4
Fee-based revenue	73			69			66			67			67
Other	17			16			20			15			13
Total noninterest income	$	90		$	85		$	86		$	82		$	80
Selected equity and performance ratios ^{(1) (3)}
Tangible common equity / tangible assets	7.22		%	7.07		%	7.08		%	7.11		%	7.10		%
Return on average equity	7.96		%	6.17		%	8.10		%	7.35		%	7.31		%
Return on average tangible common equity	11.99		%	9.16		%	12.20		%	11.06		%	11.07		%
Return on average common equity Tier 1	11.39		%	8.77		%	11.73		%	10.63		%	10.61		%
Efficiency ratio reconciliation ⁽⁴⁾
Federal Reserve efficiency ratio	70.76		%	66.93		%	63.92		%	66.69		%	66.39		%
Fully tax-equivalent adjustment	(0.66		)%	(1.30		)%	(1.21		)%	(1.30		)%	(1.30		)%
Other intangible amortization	(0.51		)%	(0.18		)%	(0.16		)%	(0.18		)%	(0.20		)%
Fully tax-equivalent efficiency ratio	69.60		%	65.45		%	62.55		%	65.21		%	64.89		%
Acquisition related costs adjustment	(6.60		)%	—		%	—		%	—		%	—		%
Fully tax-equivalent efficiency ratio, excluding acquisition related costs	63.00		%	65.45		%	62.55		%	65.21		%	64.89		%

Acquisition Related Costs	1Q 2018			1Q 2018 per share data ⁽⁶⁾
GAAP earnings	$	67		$	0.40
Change of control and severance	7
Merger advisors and consultants	4
Facilities and other	5
Contract terminations	5
Total acquisition related costs	$	21
Less additional tax expense	$	5
Earnings, excluding acquisition related costs ⁽⁵⁾	$	83		$	0.50

Numbers may not add due to rounding.


(1)	The ratio tangible common equity to tangible assets excludes goodwill and other intangible assets, net. This financial measure has been included as it is considered to be a critical metric with which to analyze and evaluate financial condition and capital strength.


(2)	These financial measures have been included as they provide meaningful supplemental information to assess trends in the Corporation’s results of operations. May not match the income statement due to rounding.


(3)	These capital measurements are used by management, regulators, investors, and analysts to assess, monitor and compare the quality and composition of our capital with the capital of other financial services companies.

(4)

The efficiency ratio as defined by the Federal Reserve guidance is noninterest expense (which includes the provision for unfunded commitments) divided by the sum of net interest income plus noninterest income, excluding investment securities gains / losses, net. The fully tax-equivalent efficiency ratio is noninterest expense (which includes the provision for unfunded commitments), excluding other intangible amortization, divided by the sum of fully tax-equivalent net interest income plus noninterest income, excluding investment securities gains / losses, net. Management believes the fully tax-equivalent efficiency ratio, which adjusts net interest income for the tax-favored status of certain loans and investment securities, to be the preferred industry measurement as it enhances the comparability of net interest income arising from taxable and tax-exempt sources.


(5)	This is a non-GAAP financial measure. Management believes these measures are meaningful because it reflects adjustments commonly made by management, investors, regulators, and analysts to evaluate the adequacy of earnings per common share and provides greater understanding of ongoing operations and enhances comparability of results with prior periods.


(6)	Earnings and per share data presented after-tax.

Page 8

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