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Section 1: 8-K (8-K)

fult-20200421
0000700564false00007005642020-04-212020-04-21


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

April 21, 2020
Date of Report (date of earliest event reported)

Fulton Financial Corporation
(Exact name of registrant as specified in its charter)
PA
0-10587
23-2195389
(State or other jurisdiction of incorporation)
(Commission File Number)
(I.R.S. Employer Identification No.)
One Penn Square,
Lancaster,
PA
17604
(Address of Principal Executive Offices)
(Zip Code)
(717) 291-2411
(Registrant's telephone number, including area code)

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))

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common stock, par value $2.50FULTThe Nasdaq Stock Market, LLC

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.
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Item 2.02 Results of Operations and Financial Condition.

        On April 21, 2020, Fulton Financial Corporation (the "Corporation") issued a press release (the "Press Release") announcing its results of operations for the first quarter ended March 31, 2020. A copy of the Press Release and supplementary financial information which accompanied the Press Release, are attached as Exhibits 99.1 and 99.2, respectively, to this Current Report and are incorporated herein by reference. The Corporation also posted on its Investor Relations website, www.fult.com, presentation materials the Corporation intends to use during a conference call and webcast to discuss those results on Wednesday, April 22, 2020 at 10:00 a.m. Eastern Time. A copy of the presentation materials is attached as Exhibit 99.3 to this Current Report and is incorporated herein by reference.
Forward-Looking Statements

This Current Report on Form 8-K, including the Exhibits hereto, may contain forward-looking statements with respect to the Corporation’s financial condition, results of operations and business. Do not unduly rely on forward-looking statements. Forward-looking statements can be identified by the use of words such as "may," "should," "will," "could," "estimates," "predicts," "potential," "continue," "anticipates," "believes," "plans," "expects," "future," "intends," "projects," the negative of these terms and other comparable terminology. Statements relating to the "outlook" or "Q2 2020 Outlook" contained in Exhibit 99.3 to this Current Report are forward looking statements. These forward looking statements may include projections of, or guidance on, the Corporation’s future financial performance, expected levels of future expenses, anticipated growth strategies, descriptions of new business initiatives and anticipated trends in the Corporation’s business or financial results.

Forward-looking statements are neither historical facts, nor assurance of future performance. Instead, they are based on current beliefs, expectations and assumptions regarding the future of the Corporation’s business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of the Corporation’s control, and actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not unduly rely on any of these forward-looking statements. Any forward-looking statement is based only on information currently available and speaks only as of the date when made. The Corporation undertakes no obligation, other than as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

A discussion of certain risks and uncertainties affecting the Corporation, and some of the factors that could cause the Corporation's actual results to differ materially from those described in the forward-looking statements, can be found in the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2019 and other current and periodic reports, which have been or will be filed with the Securities and Exchange Commission and are or will be available in the Investor Relations section of the Corporation's website (www.fult.com) and on the Securities and Exchange Commission's website (www.sec.gov). The Quarterly Report on Form 10-Q for the quarter ended March 31, 2020 will address risks and uncertainties associated with the COVID-19 pandemic.



In addition, the COVID-19 pandemic is having an adverse impact on the Corporation, its customers and the communities it serves. The adverse effect of the COVID-19 pandemic on the Corporation, its customers and the communities where it operates may adversely affect the Corporation’s business, results of operations and financial condition for an indefinite period of time.


Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.

Exhibit No.Description
Press Release dated April 21, 2020.
Supplementary financial information for the quarter ended March 31, 2020.
Presentation materials to be discussed during the conference call and webcast on April 22, 2020.
























SIGNATURE
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.
Date: April 21, 2020
FULTON FINANCIAL CORPORATION

By: /s/ Mark R. McCollom
       Mark R. McCollom
       Senior Executive Vice President and
       Chief Financial Officer

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Section 2: EX-99.1 (EX-99.1)

Document

Exhibit 99.1

FULTON FINANCIAL
CORPORATION


FOR IMMEDIATE RELEASE
Media Contact: Laura Wakeley (717) 291-2616
Investor Contact: Jason Weber (717) 327-2394


Fulton Financial Responds to the COVID-19 Pandemic, “It’s Personal”, and Announces First quarter Earnings

(April 21, 2020) – Lancaster, PA – Fulton Financial Corporation (NASDAQ:FULT) (“Fulton” or the “Corporation”) reported net income of $26 million, or $0.16 per diluted share, for the first quarter of 2020.

“The COVID-19 pandemic and unprecedented public health response have created extraordinary personal and societal challenges across our nation and world,” said E. Philip Wenger, Chairman and CEO. “Fulton began to experience the effects of these challenges midway through the first quarter and our financial results reflect these challenges. But, as we have seen before, extreme hardship often gives rise to extraordinary efforts, and we have seen that with respect to the heroic efforts of our health care workers, first responders and countless other citizens on the front lines of essential businesses that are enabling us to ‘Stay Together, Apart.’ We are all very thankful for their selfless efforts, including from our own employees.”
“In this crisis, more than ever before, our Fulton brand – ‘It’s Personal’– reflects our own bias for action, rather than just words, and that is exemplified in how Fulton is dealing with COVID-related challenges. We have undertaken a number of measures to help our employees and their families through this difficult time, both to keep them safe and also to reward them for keeping us open for business so that we can continue to provide essential banking services to our customers and communities. I am extremely proud of the efforts our employees have made. One outstanding example is how I have seen our people rally to support the SBA’s efforts to assist small businesses and their employees with the Paycheck Protection Program of the CARES Act. Our employees worked 24/7 the last two weeks to have the SBA approve $1.7 billion in forgiveable loans that Fulton Bank is making to our small business customers so that those businesses can maintain employees on their payrolls and, hopefully, reopen for business sometime in the not-too-distant future.”
“No one can predict when our communities and nation will again enjoy a sense of normalcy, but I can tell you that Fulton Bank is strong – it is ‘well-capitalized,’ it is liquid, and it stands ready to continue to deploy its considerable resources in support of customers and communities across our footprint as we continue to navigate through these difficult times in the days and months ahead.”






Net Interest Income and Balance Sheet
Net interest income for the first quarter of 2020 was $161 million, an increase of $1 million from the fourth quarter of 2019, driven by interest-earning asset growth, primarily in loans and investment securities. Net interest margin for the first quarter of 2020 decreased to 3.21% from 3.22% in the fourth quarter of 2019.
Total average assets for the first quarter of 2020 were $22.3 billion, an increase of $440 million from the fourth quarter of 2019. Average loans, net of unearned income, of $16.9 billion were consistent with the fourth quarter of 2019.
Average loans and yields, by type, for the first quarter of 2020 in comparison to the fourth quarter of 2019 are summarized in the following table:
Three Months Ended
March 31, 2020December 31, 2019Growth
BalanceYield (1)BalanceYield (1)$%
(dollars in thousands)
Average Loans, net of unearned income, by type:
    Real estate - commercial mortgage$6,746,766  4.20 %$6,561,029  4.34 %$185,737  2.8 %
    Commercial and industrial4,446,750  4.21 %4,575,133  4.24 %(128,383) (2.8)%
    Real estate - residential mortgage2,670,019  3.97 %2,606,136  4.00 %63,883  2.5 %
    Real estate - home equity1,300,132  4.73 %1,331,088  4.97 %(30,956) (2.3)%
    Real estate - construction929,529  4.13 %934,556  4.37 %(5,027) (0.5)%
    Consumer466,415  4.34 %464,606  4.44 %1,809  0.4 %
    Equipment lease financing284,566  4.32 %281,451  4.35 %3,115  1.1 %
    Other15,890  N/A  14,058  N/A  1,832  13.0 %
Total Average Loans, net of unearned income$16,860,067  4.23 %$16,768,057  4.31 %$92,010  0.5 %
(1) Presented on a fully-taxable equivalent basis using a 21% Federal tax rate and statutory interest expense disallowances.
        
Total average liabilities increased $444 million, from the fourth quarter of 2019 driven by increases in borrowings of $773 million, while average deposits decreased $328 million. Average deposits and interest rates, by type, for the first quarter of 2020 in comparison to the fourth quarter of 2019 are summarized in the following table:

Three Months Ended
March 31, 2020December 31, 2019Growth
BalanceRateBalanceRate$%
(dollars in thousands)
Average Deposits, by type:
    Noninterest-bearing demand$4,307,027  — %$4,324,568  — %$(17,541) (0.4)%
    Interest-bearing demand4,649,905  0.49 %4,699,040  0.72 %(49,135) (1.0)%
    Savings and money market deposits5,127,662  0.56 %5,205,260  0.78 %(77,598) (1.5)%
Total average demand and savings14,084,594  0.36 %14,228,868  0.52 %(144,274) (1.0)%
    Brokered deposits275,359  1.57 %261,689  1.94 %13,670  5.2 %
    Time deposits2,761,474  1.84 %2,959,008  1.86 %(197,534) (6.7)%
Total Average Deposits$17,121,427  0.62 %$17,449,565  0.77 %$(328,138) (1.9)%




Asset Quality

Effective January 1, 2020, Fulton adopted Accounting Standards Update 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” referred to as the current expected credit loss model (“CECL”). This accounting standard requires that credit losses for financial assets and off-balance-sheet credit exposures be measured based on expected credit losses, rather than on incurred credit losses as in prior periods. As a result of the adoption of CECL, the allowance for credit losses was increased by $58 million, and retained earnings was decreased by $44 million.
The provision for credit losses for the first quarter of 2020 was $44 million, applying the expected credit losses measurement standard under CECL. The expected credit losses in the first quarter of 2020 were based on forecasted economic assumptions, including the estimated impacts of COVID-19, over the remaining expected lives of financial assets and off-balance-sheet credit exposures.
Non-performing assets were $147 million, or 0.64% of total assets, at March 31, 2020, relatively unchanged from December 31, 2019 and March 31, 2019. 
Annualized net charge-offs for the quarter ended March 31, 2020 were 0.26% of total average loans, compared to 0.65% and 0.10% for the quarters ended December 31, 2019 and March 31, 2019, respectively. A $20 million charge-off was recorded for one credit in the fourth quarter of 2019, accounting for most of the difference in this metric for that period in comparison to the first quarter of 2020.

Non-interest Income
Non-interest income in the first quarter of 2020, excluding investment securities gains, was $55 million, relatively unchanged from the fourth quarter of 2019 and an increase of $8 million, or 17%, compared to the first quarter of 2019. Drivers of non-interest income growth in the first quarter of 2020 were mortgage banking and wealth management, offset by decreases in capital markets, consumer card income and merchant and commercial card income compared to the fourth quarter of 2019.
Mortgage banking revenue increased $1 million from the fourth quarter of 2019, reflecting the net result of a $2 million increase in gains on mortgage loan sales, partially offset by a $1 million mortgage servicing rights impairment charge recorded in the first quarter of 2020 as a result of rapidly declining interest rates and related increases in prepayment speeds.

Non-interest Expense
Non-interest expense was $143 million in the first quarter of 2020, an increase of $4 million, or 3%, compared to the fourth quarter of 2019. The increase was driven by salaries and employee benefits, professional fees, and FDIC insurance expense.
Compared to the first quarter of 2019, non-interest expenses increased $5 million, or 3% due primarily to higher salaries and employee benefits, data processing and software and one additional day.





Income Tax Expense
The effective income tax rate for the first quarter of 2020 was 10%, as compared to 13% and 16% for the fourth quarter of 2019 and first quarter of 2019, respectively. The decrease in the effective income tax rate in 2020 was related to a decline in income before income taxes.

Additional information on Fulton is available on the Internet at www.fult.com.



Safe Harbor Statement
This news release may contain forward-looking statements with respect to the
Corporation’s financial condition, results of operations and business. Do not unduly rely on forward-looking statements. Forward-looking statements can be identified by the use of words such as "may," "should," "will," "could," "estimates," "predicts," "potential," "continue," "anticipates," "believes," "plans," "expects," "future," "intends," “projects,” the negative of these terms and other comparable terminology. These forward looking statements may include projections of, or guidance on, the Corporation’s future financial performance, expected levels of future expenses, anticipated growth strategies, descriptions of new business initiatives and anticipated trends in the Corporation’s business or financial results.
Forward-looking statements are neither historical facts, nor assurance of future performance. Instead, they are based on current beliefs, expectations and assumptions regarding the future of the Corporation’s business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of the Corporation’s control, and actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not unduly rely on any of these forward-looking statements. Any forward-looking statement is based only on information currently available and speaks only as of the date when made. The Corporation undertakes no obligation, other than as required by law, to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
A discussion of certain risks and uncertainties affecting the Corporation, and some of the factors that could cause the Corporation's actual results to differ materially from those described in the forward-looking statements, can be found in the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2019 and other current and periodic reports, which have been or will be filed with the Securities and Exchange Commission and are or will be available in the Investor Relations section of the Corporation's website (www.fult.com) and on the Securities and Exchange Commission's website (www.sec.gov). The Quarterly Report on Form 10-Q for the quarter ended March 31, 2020 will address risks and uncertainties associated with the COVID-19 pandemic.
In addition, the COVID-19 pandemic is having an adverse impact on the Corporation, its customers and the communities it serves. The adverse effect of the COVID-19 pandemic on the



Corporation, its customers and the communities where it operates may adversely affect the Corporation’s business, results of operations and financial condition for an indefinite period of time.

Non-GAAP Financial Measures

The Corporation uses certain non-GAAP financial measures in this earnings release. These non-GAAP financial measures are reconciled to the most comparable GAAP measures in tables at the end of this release.


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Section 3: EX-99.2 (EX-99.2)

Document


FULTON FINANCIAL CORPORATION
SUMMARY CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED)
in thousands, except per-share data and percentages
Three Months Ended
Mar 31Dec 31Sep 30Jun 30Mar 31
20202019201920192019
Ending Balances
Investments$3,141,440  $2,867,378  $2,705,610  $2,853,358  $2,748,249  
Loans, net of unearned income17,077,403  16,837,526  16,686,866  16,368,458  16,262,633  
Total assets22,929,859  21,886,040  21,703,618  21,308,670  20,974,649  
Deposits17,365,026  17,393,913  17,342,717  16,388,895  16,377,978  
Shareholders' equity2,285,748  2,342,176  2,324,016  2,308,798  2,301,019  
Average Balances
Investments$3,071,828  $2,830,999  $2,829,672  $2,790,392  $2,699,130  
Loans, net of unearned income16,860,067  16,768,057  16,436,507  16,316,076  16,194,375  
Total assets22,252,099  21,812,438  21,457,800  21,057,030  20,690,365  
Deposits17,121,427  17,449,565  16,950,667  16,375,457  16,275,633  
Shareholders' equity2,337,016  2,341,397  2,315,585  2,301,258  2,265,097  
Income Statement
Net interest income$160,746  $159,270  $161,260  $164,544  $163,315  
Provision for credit losses44,030  20,530  2,170  5,025  5,100  
Non-interest income54,644  55,281  59,813  54,316  46,751  
Non-interest expense142,552  138,974  146,770  144,168  137,824  
Income before taxes28,808  55,047  72,133  69,667  67,142  
Net income26,047  47,789  62,108  59,780  56,663  
Pre-provision net revenue(1)
74,374  77,224  76,741  76,114  73,775  
Per Share
Net income (basic)$0.16  $0.29  $0.38  $0.36  $0.33  
Net income (diluted)$0.16  $0.29  $0.37  $0.35  $0.33  
Cash dividends$0.13  $0.17  $0.13  $0.13  $0.13  
Tangible common equity(1)
10.8411.0010.9110.6310.39
Weighted average shares (basic)163,475  164,135  165,324  168,343  169,884  
Weighted average shares (diluted)164,417  165,039  166,126  169,168  170,909  
Asset Quality(2)
Net charge-offs (recoveries) to average loans (annualized)0.26 %0.65 %0.15 %(0.04)%0.10 %
Non-performing loans to total loans0.82 %0.84 %0.81 %0.90 %0.85 %
Non-performing assets to total assets0.64 %0.68 %0.66 %0.73 %0.70 %
ACL - loans(3) to loans outstanding
1.40 %0.97 %1.00 %1.04 %1.00 %
ACL - loans(3) to non-performing loans
170 %116 %122 %115 %117 %
Non-performing assets to tangible shareholders' equity
     and ACL - loans (1)(3)
7.37 %7.51 %7.35 %7.97 %7.66 %



Profitability
Return on average assets0.47 %0.87 %1.15 %1.14 %1.11 %
Return on average shareholders' equity4.48 %8.10 %10.64 %10.42 %10.15 %
Return on average shareholders' equity (tangible)(1)
5.84 %10.52 %14.03 %13.60 %13.28 %
Net interest margin3.21 %3.22 %3.31 %3.44 %3.49 %
Efficiency ratio(1)
64.5 %63.1 %63.6 %64.2 %63.9 %
Capital Ratios
Tangible common equity ratio(1)
7.8 %8.5 %8.5 %8.5 %8.6 %
Tier 1 leverage ratio(4)
7.9 %8.4 %8.5 %8.7 %8.9 %
Common equity Tier 1 capital ratio(4)
9.4 %9.7 %9.6 %10.0 %10.2 %
Tier 1 capital ratio(4)
9.4 %9.7 %9.6 %10.0 %10.2 %
Total risk-based capital ratio(4)
13.8 %11.8 %12.0 %12.4 %12.6 %
(1) Please refer to the calculation on the page titled “Reconciliation of Non-GAAP Measures” at the end of this document.
(2) Effective January 1, 2020, Fulton adopted Accounting Standards Update 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments,” referred to as the current expected credit loss model (“CECL”). This accounting standard requires that credit losses for financial assets and off-balance-sheet ("OBS") credit exposures be measured based on expected credit losses, rather than on incurred credit losses as in prior periods.
(3) "ACL - loans" relates to the allowance for credit losses ("ACL") specifically on "Loans, net of unearned income" and does not include the ACL related to OBS credit exposures.
(4) Regulatory capital ratios as of March 31, 2020 are preliminary and prior periods are actual.





Exhibit 99.2
FULTON FINANCIAL CORPORATION
CONDENSED CONSOLIDATED ENDING BALANCE SHEETS (UNAUDITED)
dollars in thousands
 % Change from
Mar 31Dec 31Sep 30Jun 30Mar 31Dec 31Mar 31
2020201920192019201920192019
ASSETS
Cash and due from banks$181,777  $132,283  $120,671  $107,091  $115,884  37.4 %56.9 %
Other interest-earning assets793,572  482,930  572,499  488,968  411,037  64.3 %93.1 %
Loans held for sale40,645  37,828  33,945  45,754  27,768  7.4 %46.4 %
Investment securities3,141,440  2,867,378  2,705,610  2,853,358  2,748,249  9.6 %14.3 %
Loans, net of unearned income17,077,403  16,837,526  16,686,866  16,368,458  16,262,633  1.4 %5.0 %
ACL - loans, net of unearned income(1)
(238,508) (163,622) (166,135) (170,233) (162,109) 45.8 %47.1 %
     Net loans16,838,895  16,673,904  16,520,731  16,198,225  16,100,524  1.0 %4.6 %
Premises and equipment236,908  240,046  237,344  243,300  239,004  (1.3)%(0.9)%
Accrued interest receivable59,365  60,898  60,447  62,984  62,207  (2.5)%(4.6)%
Goodwill and intangible assets535,171  535,303  534,178  535,249  535,356  — %— %
Other assets1,102,086  855,470  918,193  773,741  734,620  28.8 %50.0 %
    Total Assets$22,929,859  $21,886,040  $21,703,618  $21,308,670  $20,974,649  4.8 %9.3 %
LIABILITIES AND SHAREHOLDERS' EQUITY
Deposits$17,365,026  $17,393,913  $17,342,717  $16,388,895  $16,377,978  (0.2)%6.0 %
Short-term borrowings1,386,808  883,241  832,860  1,188,390  829,016  57.0 %67.3 %
Other liabilities513,811  384,941  477,311  435,171  401,324  33.5 %28.0 %
FHLB advances and long-term debt1,378,466  881,769  726,714  987,416  1,065,312  56.3 %29.4 %
    Total Liabilities20,644,111  19,543,864  19,379,602  18,999,872  18,673,630  5.6 %10.6 %
Shareholders' equity2,285,748  2,342,176  2,324,016  2,308,798  2,301,019  (2.4)%(0.7)%
    Total Liabilities and Shareholders' Equity$22,929,859  $21,886,040  $21,703,618  $21,308,670  $20,974,649  4.8 %9.3 %
LOANS, DEPOSITS AND SHORT-TERM BORROWINGS DETAIL:
Loans, by type:
Real estate - commercial mortgage$6,895,069  $6,700,776  $6,604,634  $6,497,973  $6,428,688  2.9 %7.3 %
Commercial and industrial4,451,239  4,446,701  4,494,496  4,365,248  4,429,538  0.1 %0.5 %
Real estate - residential mortgage2,718,290  2,641,465  2,570,793  2,451,966  2,313,908  2.9 %17.5 %
Real estate - home equity1,292,677  1,314,944  1,346,115  1,386,974  1,413,500  (1.7)%(8.5)%
Real estate - construction947,768  971,079  913,644  922,547  953,087  (2.4)%(0.6)%
Consumer468,172  463,164  464,213  452,874  433,545  1.1 %8.0 %
Equipment lease financing and other304,188  299,397  292,971  290,876  290,367  1.6 %4.8 %
Total Loans, net of unearned income$17,077,403  $16,837,526  $16,686,866  $16,368,458  $16,262,633  1.4 %5.0 %
Deposits, by type:
Noninterest-bearing demand$4,531,872  $4,453,324  $4,240,478  $4,226,404  $4,255,043  1.8 %6.5 %
Interest-bearing demand4,724,520  4,720,188  4,771,109  4,083,615  4,207,442  0.1 %12.3 %
Savings and money market accounts5,092,865  5,153,941  5,094,387  4,938,998  4,907,346  (1.2)%3.8 %
Total demand and savings14,349,257  14,327,453  14,105,974  13,249,017  13,369,831  0.2 %7.3 %
Brokered deposits313,337  264,531  256,870  246,116  251,395  18.5 %24.6 %
Time deposits2,702,432  2,801,929  2,979,873  2,893,762  2,756,752  (3.6)%(2.0)%
Total Deposits$17,365,026  $17,393,913  $17,342,717  $16,388,895  $16,377,978  (0.2)%6.0 %
Short-term borrowings, by type:
Customer repurchase agreements$52,919  $56,707  $58,853  $56,496  $54,440  (6.7)%(2.8)%
Customer short-term promissory notes408,889  326,534  279,007  281,894  299,576  25.2 %36.5 %
Short-term FHLB advances725,000  500,000  475,000  650,000  475,000  45.0 %52.6 %
Federal funds purchased200,000  —  20,000  200,000  —  N/M  N/M  
Total Short-term Borrowings$1,386,808  $883,241  $832,860  $1,188,390  $829,016  57.0 %67.3 %
N/M - Not meaningful
(1) "ACL - loans" relates to the ACL specifically on "Loans, net of unearned income" and does not include the ACL related to OBS credit exposures.





FULTON FINANCIAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
dollars in thousands
Three Months Ended % Change from
Mar 31Dec 31Sep 30Jun 30Mar 31Dec 31Mar 31
2020201920192019201920192019
Interest Income:
Interest income$199,378  $202,159  $208,413  $210,034  $204,700  (1.4)%(2.6)%
Interest expense38,632  42,889  47,153  45,490  41,385  (9.9)%(6.7)%
    Net Interest Income160,746  159,270  161,260  164,544  163,315  0.9 %(1.6)%
Provision for credit losses44,030  20,530  2,170  5,025  5,100  114.5 %N/M  
    Net Interest Income after Provision116,716  138,740  159,090  159,519  158,215  (15.9)%(26.2)%
Non-Interest Income:
Wealth management15,055  14,419  13,867  14,153  13,239  4.4 %13.7 %
Mortgage banking 6,234  5,076  6,658  6,593  4,772  22.8 %30.6 %
Consumer banking income:
  Card4,685  4,991  5,791  5,047  4,686  (6.1)%— %
  Overdraft 4,058  4,750  4,682  4,413  4,104  (14.6)%(1.1)%
  Other consumer banking 2,496  2,688  2,860  2,907  2,587  (7.1)%(3.5)%
     Total consumer banking11,239  12,429  13,333  12,367  11,377  (9.6)%(1.2)%
Commercial banking income:
   Merchant and card 5,624  5,841  6,166  6,512  5,558  (3.7)%1.2 %
   Cash management 4,742  4,697  4,696  4,638  4,361  1.0 %8.7 %
Capital markets5,075  5,939  4,448  4,053  2,515  (14.5)%101.8 %
   Other commercial banking 2,978  3,664  3,478  3,815  2,816  (18.7)%5.8 %
     Total commercial banking 18,419  20,141  18,788  19,018  15,250  (8.5)%20.8 %
Other3,651  3,216  2,675  2,009  2,048  13.5 %78.3 %
     Non-interest income before investment securities gains 54,598  55,281  55,321  54,140  46,686  (1.2)%16.9 %
Investment securities gains, net46  —  4,492  176  65  N/M  (29.2)%
    Total Non-Interest Income54,644  55,281  59,813  54,316  46,751  (1.2)%16.9 %
Non-Interest Expense:
Salaries and employee benefits80,228  76,975  78,211  78,991  77,757  4.2 %3.2 %
Net occupancy13,486  13,080  12,368  14,469  12,909  3.1 %4.5 %
Other outside services7,881  8,215  12,163  11,259  8,352  (4.1)%(5.6)%
Data processing and software11,645  11,468  11,590  11,268  10,353  1.5 %12.5 %
Equipment 3,418  3,475  3,459  3,299  3,342  (1.6)%2.3 %
Professional fees4,202  2,873  3,331  2,970  3,960  46.3 %6.1 %
Marketing1,579  1,503  3,322  2,863  2,160  5.1 %(26.9)%
Amortization of tax credit investments1,450  1,505  1,533  1,492  1,491  (3.7)%(2.7)%
FDIC insurance2,808  2,177  239  2,755  2,609  29.0 %7.6 %
Intangible amortization132  142  1,071  107  107  (7.0)%23.4 %
Prepayment penalty on FHLB advances—  —  4,326  —  —  — %— %
Other15,723  17,561  15,157  14,695  14,784  (10.5)%6.4 %
    Total Non-Interest Expense142,552  138,974  146,770  144,168  137,824  2.6 %3.4 %
    Income Before Income Taxes28,808  55,047  72,133  69,667  67,142  (47.7)%(57.1)%
Income tax expense2,761  7,258  10,025  9,887  10,479  (62.0)%(73.7)%
    Net Income$26,047  $47,789  $62,108  $59,780  $56,663  (45.5)%(54.0)%
PER SHARE:
Net income:
    Basic$0.16  $0.29  $0.38  $0.36  $0.33  (44.8)%(51.5)%
    Diluted0.16  0.29  0.37  0.35  0.33  (44.8)%(51.5)%
Cash dividends0.13  0.17  0.13  0.13  0.13  (23.5)%— %
Weighted average shares (basic)163,475  164,135  165,324  168,343  169,884  (0.4)%(3.8)%
Weighted average shares (diluted)164,417  165,039  166,126  169,168  170,909  (0.4)%(3.8)%
N/M - not meaningful