Toggle SGML Header (+)


Section 1: 8-K (FORM 8-K)

Document




UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) April 25, 2019
Associated Banc-Corp
(Exact name of registrant as specified in its charter)
 
 
 
 
 
Wisconsin
 
001-31343
 
39-1098068
(State or other jurisdiction
of incorporation)
 
(Commission
File Number)
 
(IRS Employer
Identification No.)
 
 
 
433 Main Street, Green Bay, Wisconsin
 
54301
(Address of principal executive offices)
 
(Zip code)
Registrant’s telephone number, including area code 920-491-7500
 
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
[ ] Emerging growth company
[ ] If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.











Item 2.02 Results of Operations and Financial Condition.
 
On April 25, 2019, Associated Banc-Corp announced its earnings for the quarter ended March 31, 2019. A copy of the registrant’s press release containing this information and the slide presentation discussed on the conference call for investors and analysts on April 25, 2019, are being furnished as Exhibit 99.1 and Exhibit 99.2, respectively, to this Report on Form 8-K and are incorporated herein by reference.
 
The information furnished pursuant to this Item 2.02, including Exhibit 99.1 and Exhibit 99.2, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities under that Section and shall not be deemed to be incorporated by reference into any filing of the registrant under the Securities Act of 1933 or the Exchange Act.
 
Item 9.01 Financial Statements and Exhibits.
 
(d)  Exhibits.
 
 The following exhibits are furnished as part of this Report on Form 8-K:
 































SIGNATURES
 
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
 
Associated Banc-Corp
 
(Registrant)
 
 
 
 
 
 
Date: April 25, 2019
By:
 /s/ Christopher J. Del Moral-Niles
 
 
Christopher J. Del Moral-Niles
 
 
Chief Financial Officer


(Back To Top)

Section 2: EX-99.1 (EXHIBIT 99.1)

Exhibit


Exhibit 99.1
397659077_asblogoa02.jpg
NEWS RELEASE
Investor Contact:
Robb Timme, Senior Vice President, Director of Investor Relations     
920-491-7059
Media Contact:
Jennifer Kaminski, Vice President, Public Relations Senior Manager
920-491-7576

Associated Banc-Corp Reports First Quarter 2019 Earnings of $0.50 Per Common Share,

Earnings per share up 25% from the prior year
GREEN BAY, Wis. -- April 25, 2019 -- Associated Banc-Corp (NYSE: ASB) ("Associated" or "Company") today reported net income available to common equity ("earnings") of $83 million, or $0.50 per common share for the quarter ended March 31, 2019. These amounts compare to net income available to common equity of $67 million, or $0.40 per common share for the quarter ended March 31, 2018.
“We were pleased with our commercial and business lending results in the quarter as we had solid growth in our general commercial line and across most of our specialty lending verticals. This growth, coupled with effective cost controls and improving fee income, helped drive a 25% increase in earnings per share compared to the first quarter of 2018," said President and CEO Philip B. Flynn. "We remain optimistic for the remainder of 2019. We expect continued growth in our C&I portfolio and anticipate that our commercial real estate book will begin to ramp up in the second half of the year. Additionally, we believe the Huntington Bank branch acquisition, which is scheduled to close in June, will help us manage our funding costs this year."
FIRST QUARTER 2019 SUMMARY (all comparisons to the first quarter of 2018)
Average loans of $23.1 billion were up 5%, or $1.0 billion
Average deposits of $24.6 billion were up 4%, or $0.9 billion
Net interest income of $216 million increased $6 million, or 3%
Net interest margin of 2.90% declined 2 basis points from 2.92%
Provision for credit losses was $6 million, up from zero
Noninterest income of $91 million increased 1%, or $1 million
Noninterest expense of $192 million was down 10%, or $21 million
Income before income taxes was up 25%, or $22 million
During the quarter, the Company repurchased over 1 million shares, or $30 million, of common stock
Total dividends paid per common share were $0.17, up 13%
Return on average common equity Tier 1 increased to 13.6% from 11.4%








Loans
First quarter 2019 average loans of $23.1 billion were up $1.0 billion, or 5%, from the year ago quarter, and were up $299 million from the fourth quarter of 2018 as growth in commercial and business lending outpaced run-off in the commercial real estate portfolio.
With respect to first quarter 2019 average balances by loan category:
Commercial and business lending increased $1.1 billion from the year ago quarter and increased $357 million from the fourth quarter of 2018 to $8.4 billion. General commercial lending and power & utilities specialized lending drove the increase from the year ago quarter.
Consumer lending increased $244 million from the year ago quarter and increased $34 million from the fourth quarter of 2018 to $9.6 billion.
Commercial real estate lending decreased $282 million from the year ago quarter and decreased $92 million from the fourth quarter of 2018 to $5.1 billion as paydown activity continued to be elevated.
The Company has over $500 million in construction commitments that are expected to fund over the course of the year.

Deposits
First quarter 2019 average deposits of $24.6 billion were up $905 million, or 4% from the year ago quarter and were up $326 million compared to the fourth quarter of 2018. First quarter period end deposits were $25.5 billion, up $636 million from the end of the fourth quarter.
With respect to first quarter 2019 average balances by deposit category:
Time deposits increased $407 million from the year ago quarter and increased $61 million from the fourth quarter of 2018 to $3.1 billion.
Savings increased $376 million from the year ago quarter and increased $104 million from the fourth quarter of 2018 to $2.1 billion.
Interest-bearing demand deposits increased $236 million from the year ago quarter, but decreased $98 million from the fourth quarter of 2018 to $4.7 billion.
Money market deposits increased $173 million from the year ago quarter and increased $299 million from the fourth quarter of 2018 to $7.4 billion.
Noninterest-bearing demand deposits decreased $102 million from the year ago quarter and decreased $384 million from the fourth quarter of 2018 to $5.0 billion as the company experienced its typical seasonal outflow of deposits.
Network transaction deposits decreased $184 million from the year ago quarter, but increased $344 million from the fourth quarter of 2018 to $2.2 billion.






Net Interest Income and Net Interest Margin
First quarter 2019 net interest income of $216 million was up 3%, or $6 million, while the net interest margin decreased 2 basis points to 2.90% from the year ago quarter. First quarter 2019 net interest income decreased 4%, or $8 million, and the net interest margin decreased 12 basis points from the prior quarter, primarily due to reduced prepayments.
The average yield on total commercial loans for the first quarter of 2019 increased 64 basis points to 4.98% from the year ago quarter, but decreased 9 basis points from the prior quarter.
The average cost of total interest-bearing deposits for the first quarter of 2019 increased 57 basis points to 1.30% from the year ago quarter and increased 16 basis points from the prior quarter.
The net free funds benefit, which is the net margin increase from noninterest-bearing deposits, increased 12 basis points in the first quarter of 2019 compared to the year ago quarter and was unchanged from the prior quarter.

Noninterest Income
First quarter 2019 total noninterest income of $91 million increased $1 million from the year ago quarter and increased $7 million from the prior quarter.
With respect to first quarter 2019 noninterest income line items:
Insurance revenues were up $3 million from the year ago quarter, driven by the acquisitions of Diversified Insurance Solutions and Anderson Insurance, and were up $4 million compared to the previous quarter due to seasonally higher property and casualty revenues.
Service charges and deposit account fees were down $1 million from both the year ago quarter and the previous quarter.
Mortgage banking revenues were down $2 million from the year ago quarter, but were up $1 million from the previous quarter.







Noninterest Expense
First quarter 2019 total noninterest expense of $192 million decreased 10%, or $21 million from the year ago quarter and decreased $1 million from the prior quarter. The year ago quarter included $21 million of Bank Mutual acquisition related costs.
With respect to first quarter 2019 noninterest expense line items:
Personnel expense increased $2 million from the year ago quarter, and increased $4 million from the prior quarter due primarily to seasonal increases in stock-based compensation expense.
Occupancy expense increased $1 million from the year ago quarter and increased $2 million from the prior quarter due to higher snow removal expense.
Technology expense increased $1 million from the year ago quarter and the prior quarter as the company continued to make investments to enhance its online and mobile product offerings.
With the removal of the FDIC surcharge, the Company's FDIC assessment decreased $5 million from the year ago quarter and $2 million from the prior quarter.

Taxes
The first quarter 2019 effective tax rate was 21% compared to 20% in the year ago quarter and 22% in the prior quarter.

Credit
The first quarter 2019 provision for credit losses was $6 million, up from zero in the year ago quarter and up from $1 million in the prior quarter. With respect to first quarter 2019 credit quality:
Potential problem loans of $241 million were down $41 million from the year ago quarter and were down $9 million from the prior quarter.
Nonaccrual loans of $156 million were down $53 million from the year ago quarter, primarily due to improvements in commercial credits. While nonaccrual loans were up $28 million from the prior quarter, primarily due to migration in commercial credits, they remained flat with third quarter 2018 levels. The nonaccrual loans to total loans ratio was 0.67% in the first quarter, compared to 0.91% in the year ago quarter and 0.56% in the prior quarter.
Net charge offs of $7 million were down $2 million from the year ago quarter and up $7 million from the prior quarter.
The allowance for loan losses of $235 million was down $22 million from the year ago quarter and was down $3 million from the prior quarter. The allowance for loan losses to total loans ratio was 1.02% in the first quarter of 2019, compared to 1.13% in the year ago quarter, and 1.04% in the prior quarter.





Capital
The Company’s capital position remains strong, with a CET1 capital ratio of 10.3% at March 31, 2019. 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 over 1 million shares, or $30 million, of common stock at an average price of $22.93 per share.





FIRST QUARTER 2019 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 25, 2019. 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 2019 earnings call. The first quarter 2019 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 nearly $34 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 230 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,” "target," “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, 2019
Dec 31, 2018
Seql Qtr $ Change
Sept 30, 2018
Jun 30, 2018
Mar 31, 2018
Comp Qtr $ Change
Assets
 
 
 
 
 
 
 
Cash and due from banks
$
334,095

$
507,187

$
(173,092
)
$
374,168

$
396,761

$
328,260

$
5,835

Interest-bearing deposits in other financial institutions
270,843

221,226

49,617

147,848

71,462

94,918

175,925

Federal funds sold and securities purchased under agreements to resell
41,405

148,285

(106,880
)
24,325

3,150

10,000

31,405

Investment securities held to maturity, at amortized cost
2,846,689

2,740,511

106,178

2,661,755

2,602,247

2,443,203

403,486

Investment securities available for sale, at fair value
3,829,388

3,946,941

(117,553
)
4,052,624

4,260,037

4,484,275

(654,887
)
Equity securities with readily determinable fair values
1,609

1,568

41

1,573

1,613

1,599

10

Federal Home Loan Bank and Federal Reserve Bank stocks, at cost
216,940

250,534

(33,594
)
220,825

249,040

233,216

(16,276
)
Residential loans held for sale
81,392

64,321

17,071

134,361

143,022

103,953

(22,561
)
Commercial loans held for sale
15,467

14,943

524

30,452


6,091

9,376

Loans
23,148,359

22,940,429

207,930

22,867,112

22,976,786

22,810,491

337,868

Allowance for loan losses
(235,081
)
(238,023
)
2,942

(236,250
)
(252,601
)
(257,058
)
21,977

Loans, net
22,913,278

22,702,406

210,872

22,630,861

22,724,184

22,553,433

359,845

Bank and corporate owned life insurance
665,976

663,203

2,773

661,009

659,592

657,841

8,135

Investment in unconsolidated subsidiaries
194,670

161,181

33,489

156,878

161,676

166,124

28,546

Trading assets
77,920

88,943

(11,023
)
140,328

132,919

102,890

(24,970
)
Premises and equipment
361,668

363,225

(1,557
)
358,926

361,385

381,327

(19,659
)
Goodwill
1,168,944

1,169,023

(79
)
1,168,922

1,166,665

1,153,156

15,788

Mortgage servicing rights, net
66,626

68,193

(1,567
)
67,872

66,980

66,407

219

Other intangible assets, net
73,610

75,836

(2,226
)
78,069

80,346

79,714

(6,104
)
Other assets
540,346

460,331

80,015

578,206

571,566

500,099

40,247

Total assets
$
33,700,866

$
33,647,859

$
53,007

$
33,489,002

$
33,652,647

$
33,366,505

$
334,361

Liabilities and stockholders’ equity
 
 
 
 
 
 
 
Noninterest-bearing demand deposits
$
5,334,154

$
5,698,530

$
(364,376
)
$
5,421,270

$
5,341,361

$
5,458,473

$
(124,319
)
Interest-bearing deposits
20,198,903

19,198,863

1,000,040

19,410,342

18,474,953

18,367,129

1,831,774

Total deposits
25,533,057

24,897,393

635,664

24,831,612

23,816,314

23,825,602

1,707,455

Federal funds purchased and securities sold under agreements to repurchase
127,098

111,651

15,447

166,556

203,733

283,954

(156,856
)
Commercial paper
32,019

45,423

(13,404
)
43,604

52,791

82,420

(50,401
)
FHLB advances
2,944,769

3,574,371

(629,602
)
3,332,655

4,797,857

4,515,887

(1,571,118
)
Other long-term funding
796,007

795,611

396

795,215

497,619

497,451

298,556

Trading liabilities
77,859

87,668

(9,809
)
138,940

131,612

100,247

(22,388
)
Accrued expenses and other liabilities
354,188

354,855

(667
)
383,381

382,476

348,246

5,942

Total liabilities
29,864,996

29,866,971

(1,975
)
29,691,963

29,882,403

29,653,806

211,190

Stockholders’ equity(a)
 
 
 
 
 
 
 
Preferred equity
256,716

256,716


256,716

159,401

159,853

96,863

Common equity
 
 
 
 
 
 
 
Common stock
1,752

1,752


1,752

1,751

1,741

11

Surplus
1,689,792

1,712,615

(22,823
)
1,709,078

1,704,587

1,698,521

(8,729
)
Retained earnings
2,235,824

2,181,414

54,410

2,128,490

2,070,872

2,010,746

225,078

Accumulated other comprehensive income (loss)
(103,375
)
(124,972
)
21,597

(135,520
)
(119,888
)
(107,673
)
4,298

Treasury stock, at cost
(244,840
)
(246,638
)
1,798

(163,478
)
(46,479
)
(50,488
)
(194,352
)
Total common equity
3,579,153

3,524,171

54,982

3,540,322

3,610,843

3,552,847

26,306

Total stockholders’ equity
3,835,870

3,780,888

54,982

3,797,038

3,770,244

3,712,699

123,171

Total liabilities and stockholders’ equity
$
33,700,866

$
33,647,859

$
53,007

$
33,489,002

$
33,652,647

$
33,366,505

$
334,361

Numbers may not sum due to rounding.
(a) An adjustment of $115 million was made within stockholders' equity related to the grant and vesting of options, restricted stock awards, and restricted stock units awarded from 2006-2017 to the March 31, 2018 ending balances.  This adjustment impacted Retained Earnings and Surplus.  The reclassification had no impact on earnings, expenses, or total stockholder’s equity.




Page 1




Associated Banc-Corp
Consolidated Statements of Income (Unaudited) - Quarterly Trend
(In thousands, except per share data)
 
 
 
 
Seql Qtr
 
 
 
 
 
 
 
Comp Qtr
1Q19
 
4Q18
 
$ Change
 
% Change
 
3Q18
 
2Q18
 
1Q18
 
$ Change
 
% Change
Interest income
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest and fees on loans
$
258,853

 
$
260,661

 
$
(1,808
)
 
(1
)%
 
$
249,649

 
$
246,646

 
$
220,034

 
$
38,819

 
18
 %
Interest and dividends on investment securities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Taxable
29,053

 
29,119

 
(66
)
 
 %
 
29,895

 
30,623

 
30,104

 
(1,051
)
 
(3
)%
Tax-exempt
13,816

 
12,899

 
917

 
7
 %
 
11,883

 
10,783

 
9,217

 
4,599

 
50
 %
Other interest
4,226

 
3,257

 
969

 
30
 %
 
4,036

 
3,153

 
2,177

 
2,049

 
94
 %
Total interest income
305,948

 
305,936

 
12

 
 %
 
295,464

 
291,205

 
261,532

 
44,416

 
17
 %
Interest expense
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest on deposits
62,773

 
54,159

 
8,614

 
16
 %
 
50,116

 
38,431

 
33,412

 
29,361

 
88
 %
Interest on Federal funds purchased and securities sold under agreements to repurchase
627

 
442

 
185

 
42
 %
 
504

 
538

 
522

 
105

 
20
 %
Interest on other short-term funding
51

 
36

 
15

 
42
 %
 
38

 
51

 
60

 
(9
)
 
(15
)%
Interest on FHLB advances
19,554

 
19,948

 
(394
)
 
(2
)%
 
19,318

 
21,279

 
13,123

 
6,431

 
49
 %
Interest on long-term funding
7,396

 
7,396

 

 
 %
 
6,095

 
4,544

 
4,544

 
2,852

 
63
 %
Total interest expense
90,401

 
81,980

 
8,421

 
10
 %
 
76,072

 
64,843

 
51,661

 
38,740

 
75
 %
Net interest income
215,547

 
223,955

 
(8,408
)
 
(4
)%
 
219,392

 
226,362

 
209,871

 
5,676

 
3
 %
Provision for credit losses
6,000

 
1,000

 
5,000

 
N/M

 
(5,000
)
 
4,000

 

 
6,000

 
N/M

Net interest income after provision for credit losses
209,547

 
222,955

 
(13,408
)
 
(6
)%
 
224,392

 
222,362

 
209,871

 
(324
)
 
 %
Noninterest income
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Insurance commissions and fees
25,464

 
21,232

 
4,232

 
20
 %
 
21,636

 
23,996

 
22,648

 
2,816

 
12
 %
Wealth management fees (a)
20,180

 
20,364

 
(184
)
 
(1
)%
 
21,224

 
20,333

 
20,642

 
(462
)
 
(2
)%
Service charges and deposit account fees
15,115

 
16,361

 
(1,246
)
 
(8
)%
 
16,904

 
16,390

 
16,420

 
(1,305
)
 
(8
)%
Card-based fees
9,261

 
10,316

 
(1,055
)
 
(10
)%
 
9,783

 
10,115

 
9,442

 
(181
)
 
(2
)%
Other fee-based revenue
3,983

 
5,260

 
(1,277
)
 
(24
)%
 
4,307

 
4,272

 
3,980

 
3

 
 %
Capital markets, net
3,189

 
4,931

 
(1,742
)
 
(35
)%
 
5,099

 
4,783

 
5,306

 
(2,117
)
 
(40
)%
Mortgage banking, net
4,712

 
3,271

 
1,441

 
44
 %
 
4,012

 
6,258

 
6,370

 
(1,658
)
 
(26
)%
Bank and corporate owned life insurance
3,792

 
3,247

 
545

 
17
 %
 
3,540

 
3,978

 
3,187

 
605

 
19
 %
Asset gains (losses), net (b)
567

 
(2,456
)
 
3,023

 
N/M

 
(1,037
)
 
2,497

 
(107
)
 
674

 
N/M

Investment securities gains (losses), net
1,680

 

 
1,680

 
N/M

 
30

 
(2,015
)
 

 
1,680

 
N/M

Other
3,260

 
1,522

 
1,738

 
114
 %
 
2,802

 
2,235

 
2,492

 
768

 
31
 %
Total noninterest income
91,202

 
84,046

 
7,156

 
9
 %
 
88,300

 
92,842

 
90,380

 
822

 
1
 %
Noninterest expense
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Personnel
120,050

 
116,535

 
3,515

 
3
 %
 
124,476

 
123,980

 
117,685

 
2,365

 
2
 %
Technology
19,012

 
17,944

 
1,068

 
6
 %
 
17,563

 
19,452

 
17,715

 
1,297

 
7
 %
Occupancy
16,472

 
14,174

 
2,298

 
16
 %
 
14,519

 
15,071

 
15,357

 
1,115

 
7
 %
Business development and advertising
6,636

 
8,950

 
(2,314
)
 
(26
)%
 
8,213

 
7,067

 
6,693

 
(57
)
 
(1
)%
Equipment
5,668

 
5,897

 
(229
)
 
(4
)%
 
5,838

 
5,953

 
5,556

 
112

 
2
 %
Legal and professional
3,951

 
5,888

 
(1,937
)
 
(33
)%
 
5,476

 
6,284

 
5,413

 
(1,462
)
 
(27
)%
Card issuance costs
977

 
1,442

 
(465
)
 
(32
)%
 
2,247

 
2,412

 
2,332

 
(1,355
)
 
(58
)%
Loan costs
1,364

 
790

 
574

 
73
 %
 
1,430

 
761

 
972

 
392

 
40
 %
Foreclosure / OREO expense, net
567

 
909

 
(342
)
 
(38
)%
 
950

 
1,021

 
723

 
(156
)
 
(22
)%
FDIC assessment
3,750

 
5,750

 
(2,000
)
 
(35
)%
 
7,750

 
8,250

 
8,250

 
(4,500
)
 
(55
)%
Other intangible amortization
2,226

 
2,233

 
(7
)
 
 %
 
2,233

 
2,168

 
1,525

 
701

 
46
 %
Acquisition related costs (c)
632

 
(981
)
 
1,613

 
N/M

 
2,271

 
7,107

 
20,605

 
(19,973
)
 
(97
)%
Other
10,366

 
13,632

 
(3,266
)
 
(24
)%
 
11,445

 
11,732

 
10,140

 
226

 
2
 %
Total noninterest expense
191,671

 
193,163

 
(1,492
)
 
(1
)%
 
204,413

 
211,258

 
212,965

 
(21,294
)
 
(10
)%
Income before income taxes
109,078

 
113,839

 
(4,761
)
 
(4
)%
 
108,279

 
103,947

 
87,285

 
21,793

 
25
 %
Income tax expense
22,392

 
24,854

 
(2,462
)
 
(10
)%
 
22,349

 
14,754

 
17,829

 
4,563

 
26
 %
Net income
86,686

 
88,985

 
(2,299
)
 
(3
)%
 
85,929

 
89,192

 
69,456

 
17,230

 
25
 %
Preferred stock dividends
3,801

 
3,707

 
94

 
3
 %
 
2,409

 
2,329

 
2,339

 
1,462

 
63
 %
Net income available to common equity
$
82,885

 
$
85,278

 
$
(2,393
)
 
(3
)%
 
$
83,521

 
$
86,863

 
$
67,117

 
$
15,768

 
23
 %
Earnings per common share
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic
$
0.50

 
$
0.52

 
$
(0.02
)
 
(4
)%
 
$
0.49

 
$
0.51

 
$
0.41

 
$
0.09

 
22
 %
Diluted
$
0.50

 
$
0.51

 
$
(0.01
)
 
(2
)%
 
$
0.48

 
$
0.50

 
$
0.40

 
$
0.10

 
25
 %
Average common shares outstanding
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic
163,928

 
164,662

 
(734
)
 
 %
 
170,516

 
170,633

 
163,520

 
408

 
 %
Diluted
165,433

 
166,394

 
(961
)
 
(1
)%
 
172,802

 
173,409

 
166,432

 
(999
)
 
(1
)%
N/M = Not meaningful
Numbers may not sum due to rounding.
(a) Includes trust, asset management, brokerage, and annuity fees.
(b)
3Q18 and 2Q18 include approximately $1 million of Bank Mutual acquisition related asset losses net of asset gains.
(c)
Includes Bank Mutual and Huntington acquisition related costs only.

Page 2




Associated Banc-Corp
Selected Quarterly Information
 
 
 
 
 
(In millions, except per share, full time equivalent employee and branch count data; shares in thousands)
1Q19
4Q18
3Q18
2Q18
1Q18
Per common share data
 
 
 
 
 
Dividends
$
0.17

$
0.17

$
0.15

$
0.15

$
0.15

Market value:
 
 
 
 
 
High
23.67

26.55

28.35

28.85

26.90

Low
19.77

18.72

26.00

24.20

23.60

Close
21.35

19.79

26.00

27.30

24.85

Book value
21.77

21.43

21.06

20.95

20.78

Tangible book value / share
14.21

13.86

13.64

13.71

13.57

Performance ratios (annualized)
 
 
 
 
 
Return on average assets
1.05
%
1.07
%
1.02
%
1.07
%
0.88
%
Effective tax rate
20.53
%
21.83
%
20.64
%
14.19
%
20.43
%
Dividend payout ratio (a)
34.00
%
32.69
%
30.61
%
29.41
%
36.59
%
Net interest margin
2.90
%
3.02
%
2.92
%
3.02
%
2.92
%
Selected trend information
 
 
 
 
 
Average full time equivalent employees (b)
4,660

4,659

4,707

4,792

4,637

Branch count
233

236

236

237

271

Assets under management, at market value (c)
$
11,192

$
10,291

$
11,206

$
10,776

$
10,540

Mortgage loans originated for sale during period
$
163

$
245

$
331

$
319

$
198

Mortgage loan settlements during period
$
160

$
305

$
345

$
294

$
188

Mortgage portfolio serviced for others
$
8,543

$
8,601

$
8,547

$
8,501

$
8,507

Mortgage servicing rights, net / mortgage portfolio serviced for others
0.78
%
0.79
%
0.79
%
0.79
%
0.78
%
Shares repurchased during period
1,308

3,764

4,349

249

1,108

Shares outstanding, end of period
164,418

164,440

168,138

172,358

170,995

Selected quarterly ratios
 
 
 
 
 
Loans / deposits
90.66
%
92.14
%
92.09
%
96.47
%
95.74
%
Stockholders’ equity / assets
11.38
%
11.24
%
11.34
%
11.20
%
11.13
%
Risk-based capital (d) (e)
 
 
 
 
 
Total risk-weighted assets
$
24,141

$
23,875

$
23,907

$
24,059

$
23,535

Common equity Tier 1
$
2,485

$
2,450

$
2,475

$
2,528

$
2,474

Common equity Tier 1 capital ratio
10.29
%
10.26
%
10.35
%
10.51
%
10.51
%
Tier 1 capital ratio
11.35
%
11.33
%
11.42
%
11.17
%
11.19
%
Total capital ratio
13.46
%
13.47
%
13.56
%
13.36
%
13.45
%
Tier 1 leverage ratio
8.49
%
8.48
%
8.43
%
8.32
%
8.48
%
Loans
 
 
 
 
 
Recorded investment on loans
$
23,078

$
22,872

$
22,800

$
22,916

$
22,756

Net unaccreted Bank Mutual purchase discount on performing loans
(16
)
(18
)
(21
)
(26
)
(34
)
Net other deferred costs
86

87

87

87

88

Loans
$
23,148

$
22,940

$
22,867

$
22,977

$
22,810

Numbers may not sum due to rounding.
(a)
Ratio is based upon basic earnings per common share.
(b)
Average full time equivalent employees without overtime.
(c)
Excludes assets held in brokerage accounts.
(d)
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.
(e)
March 31, 2019 data is estimated.


Page 3




Associated Banc-Corp
Selected Asset Quality Information
 
 
 
 
 
 
(In thousands)
 
Mar 31, 2019
Dec 31, 2018
Seql Qtr %
Change
 
Sep 30, 2018
Jun 30, 2018
Mar 31, 2018
Comp Qtr %
Change
Allowance for loan losses
 
 
 
 
 
 
 
 
 
Balance at beginning of period
 
$
238,023

$
236,250

1
 %
 
$
252,601

$
257,058

$
265,880

(10
)%
Provision for loan losses
 
4,500

2,000

125
 %
 
(4,000
)
4,000

500

N/M

Charge offs
 
(15,486
)
(6,151
)
152
 %
 
(17,304
)
(14,926
)
(12,155
)
27
 %
Recoveries
 
8,044

5,923

36
 %
 
4,953

6,470

2,832

184
 %
Net charge offs
 
(7,442
)
(228
)
N/M

 
(12,351
)
(8,456
)
(9,323
)
(20
)%
Balance at end of period
 
$
235,081

$
238,023

(1
)%
 
$
236,250

$
252,601

$
257,058

(9
)%
Allowance for unfunded commitments
 
 
 
 
 
 
 
 
 
Balance at beginning of period
 
$
24,336

$
25,336

(4
)%
 
$
26,336

$
26,336

$
24,400

 %
Provision for unfunded commitments
 
1,500

(1,000
)
N/M

 
(1,000
)

(500
)
N/M

Amount recorded at acquisition
 


N/M

 


2,436

(100
)%
Balance at end of period
 
$
25,836

$
24,336

6
 %
 
$
25,336

$
26,336

$
26,336

(2
)%
Allowance for credit losses
 
$
260,917

$
262,359

(1
)%
 
$
261,586

$
278,937

$
283,394

(8
)%
Provision for credit losses
 
$
6,000

$
1,000

N/M

 
$
(5,000
)
$
4,000

$

N/M

 
 
Mar 31, 2019
Dec 31, 2018
Seql Qtr % Change
 
Sep 30, 2018
Jun 30, 2018
Mar 31, 2018
Comp Qtr %
Change
Net charge offs
 
 
 
 
 
 
 
 
 
Commercial and industrial
 
$
(7,428
)
$
2,974

N/M

 
$
(6,893
)
$
(6,606
)
$
(6,599
)
13
 %
Commercial real estate—owner occupied
 
1,193

282

N/M

 
(252
)
270

(1,025
)
N/M

Commercial and business lending
 
(6,235
)
3,256

N/M

 
(7,145
)
(6,336
)
(7,624
)
(18
)%
Commercial real estate—investor
 
31

(2,107
)
N/M

 
(3,958
)
(1,189
)
8

N/M

Real estate construction
 

106

(100
)%
 
(195
)
48

189

(100
)%
Commercial real estate lending
 
31

(2,001
)
N/M

 
(4,153
)
(1,141
)
197

(84
)%
Total commercial
 
(6,203
)
1,255

N/M

 
(11,298
)
(7,477
)
(7,427
)
(16
)%
Residential mortgage
 
(457
)
(94
)
N/M

 
5

(135
)
(131
)
N/M

Home equity
 
309

(270
)
N/M

 
200

140

(677
)
N/M

Other consumer
 
(1,090
)
(1,118
)
(3
)%
 
(1,258
)
(984
)
(1,088
)
 %
Total consumer
 
(1,239
)
(1,482
)
(16
)%
 
(1,053
)
(979
)
(1,896
)
(35
)%
Total net charge offs
 
$
(7,442
)
$
(228
)
N/M

 
$
(12,351
)
$
(8,456
)
$
(9,323
)
(20
)%
 
 
 
 
 
 
 
 
 
 
(In basis points)
 
Mar 31, 2019
Dec 31, 2018
 
 
Sep 30, 2018
Jun 30, 2018
Mar 31, 2018
 
Net charge offs to average loans (annualized)
 
 
 
 
 
 
 
 
 
Commercial and industrial
 
(40
)
16

 
 
(39
)
(39
)
(41
)
 
Commercial real estate—owner occupied
 
53

13

 
 
(11
)
12

(48
)
 
Commercial and business lending
 
(30
)
16

 
 
(36
)
(33
)
(42
)
 
Commercial real estate—investor
 

(22
)
 
 
(40
)
(12
)

 
Real estate construction
 

3

 
 
(5
)
1

5

 
Commercial real estate lending
 

(15
)
 
 
(30
)
(8
)
1

 
Total commercial
 
(19
)
4

 
 
(34
)
(22
)
(24
)
 
Residential mortgage
 
(2
)

 
 

(1
)
(1
)
 
Home equity
 
14

(12
)
 
 
9

6

(30
)
 
Other consumer
 
(123
)
(121
)
 
 
(133
)
(105
)
(115
)
 
Total consumer
 
(5
)
(6
)
 
 
(4
)
(4
)
(8
)
 
Total net charge offs
 
(13
)

 
 
(21
)
(15
)
(17
)
 
 
 
 
 
 
 
 
 
 
 
(In thousands)
 
Mar 31, 2019
Dec 31, 2018
Seql Qtr %
Change
 
Sep 30, 2018
Jun 30, 2018
Mar 31, 2018
Comp Qtr %
Change
Credit Quality
 
 
 
 
 
 
 
 
 
Nonaccrual loans
 
$
155,556

$
127,901

22
 %
 
$
154,092

$
204,460

$
208,553

(25
)%
Other real estate owned (OREO)
 
12,286

11,984

3
 %
 
25,653

27,207

16,919

(27
)%
Other nonperforming assets
 


N/M

 
6,379

7,059

7,117

(100
)%
Total nonperforming assets
 
$
167,843

$
139,885

20
 %
 
$
186,124

$
238,726

$
232,589

(28
)%
 
 
 
 
 
 
 
 
 
 
Loans 90 or more days past due and still accruing
 
$
2,218

$
2,165

2
 %
 
$
2,175

$
1,839

$
3,393

(35
)%
Allowance for loan losses to loans
 
1.02
%
1.04
%
 
 
1.03
%
1.10
%
1.13
%
 
Net unaccreted purchase discount to net purchased loans
 
1.41
%
1.44
%
 
 
1.48
%
1.58
%
1.80
%
 
Allowance for loan losses to nonaccrual loans
 
151.12
%
186.10
%
 
 
153.32
%
123.55
%
123.26
%
 
Nonaccrual loans to total loans
 
0.67
%
0.56
%
 
 
0.67
%
0.89
%
0.91
%
 
Nonperforming assets to total loans plus OREO
 
0.72
%
0.61
%
 
 
0.81
%
1.04
%
1.02
%
 
Nonperforming assets to total assets
 
0.50
%
0.42
%
 
 
0.56
%
0.71
%
0.70
%
 
Year-to-date net charge offs to average loans (annualized)
 
0.13
%
0.13
%
 
 
0.18
%
0.16
%
0.17
%
 


Page 4




Associated Banc-Corp
Selected Asset Quality Information (continued)
(In thousands)
 
Mar 31, 2019
Dec 31, 2018
Seql Qtr %
Change

Sep 30, 2018
Jun 30, 2018
Mar 31, 2018
Comp Qtr %
Change
Nonaccrual loans
 
 
 
 
 
 
 
 
 
Commercial and industrial
 
$
73,379

$
41,021

79
 %
 
$
50,146

$
81,776

$
102,667

(29
)%
Commercial real estate—owner occupied
 
890

3,957

(78
)%
 
4,779

18,649

20,636

(96
)%
Commercial and business lending
 
74,269

44,978

65
 %
 
54,925

100,425

123,303

(40
)%
Commercial real estate—investor
 
776

1,952

(60
)%
 
19,725

26,503

15,574

(95
)%
Real estate construction
 
739

979

(25
)%
 
1,154

1,544

1,219

(39
)%
Commercial real estate lending
 
1,516

2,931

(48
)%
 
20,879

28,047

16,793

(91
)%
Total commercial
 
75,784

47,909

58
 %
 
75,804

128,472

140,096

(46
)%
Residential mortgage
 
67,323

67,574

 %
 
65,896

62,896

55,100

22
 %
Home equity
 
12,300

12,339

 %
 
12,324

12,958

13,218

(7
)%
Other consumer
 
149

79

89
 %
 
68

134

139

7
 %
Total consumer
 
79,772

79,992

 %
 
78,288

75,988

68,456

17
 %
Total nonaccrual loans
 
$
155,556

$
127,901

22
 %
 
$
154,092

$
204,460

$
208,553

(25
)%
 
 
 
 
 
 
 
 
 
 
 
 
Mar 31, 2019
Dec 31, 2018
Seql Qtr %
Change
 
Sep 30, 2018
Jun 30, 2018
Mar 31, 2018
Comp Qtr %
Change
Restructured loans (accruing)
 
 
 
 
 
 
 
 
 
Commercial and industrial
 
$
15,443

$
25,478

(39
)%
 
$
38,885

$
32,438

$
29,580

(48
)%
Commercial real estate—owner occupied
 
2,026

2,080

(3
)%
 
3,746

3,820

3,892

(48
)%
Commercial and business lending
 
17,469

27,558

(37
)%
 
42,631

36,258

33,472

(48
)%
Commercial real estate—investor
 
1,700

799

113
 %
 
350

372

13,683

(88
)%
Real estate construction
 
311

311

 %
 
218

222

305

2
 %
Commercial real estate lending
 
2,011

1,110

81
 %
 
568

594

13,988

(86
)%
Total commercial
 
19,480

28,668

(32
)%
 
43,199

36,852

47,460

(59
)%
Residential mortgage
 
18,226

16,036

14
 %
 
16,986

17,934

19,902

(8
)%
Home equity
 
7,688

7,385

4
 %
 
7,792

7,900

8,098

(5
)%
Other consumer
 
1,154

1,174

(2
)%
 
1,177

1,037

1,041

11
 %
Total consumer
 
27,068

24,595

10
 %
 
25,955

26,871

29,041

(7
)%
Total restructured loans (accruing)
 
$
46,548

$
53,263

(13
)%
 
$
69,154

$
63,723

$
76,501

(39
)%
Nonaccrual restructured loans (included in nonaccrual loans)
 
$
24,172

$
26,292

(8
)%
 
$
33,757

$
38,005

$
23,827

1
 %
 
 
Mar 31, 2019
Dec 31, 2018
Seql Qtr %
Change
 
Sep 30, 2018
Jun 30, 2018
Mar 31, 2018
Comp Qtr %
Change
Accruing Loans 30-89 Days Past Due
 
 
 
 
 
 
 
 
 
Commercial and industrial
 
$
3,295

$
525

N/M

 
$
5,732

$
588

$
880

N/M

Commercial real estate—owner occupied
 
6,066

2,699

125
 %
 
6,126

193

511

N/M

Commercial and business lending
 
9,361

3,224

190
 %
 
11,858

781

1,391

N/M

Commercial real estate—investor
 
1,090

3,767

(71
)%
 
373

828

240

N/M

Real estate construction
 
6,773

330

N/M

 
517

19,765

490

N/M

Commercial real estate lending
 
7,863

4,097

92
 %
 
890

20,593