Business Wire | Jan 14, 2021 07:02AM EST

First Republic Reports 2020 Results

Jan. 14, 2021

SAN FRANCISCO--(BUSINESS WIRE)--Jan. 14, 2021--First Republic Bank (NYSE: FRC) today announced financial results for the quarter and year ended December 31, 2020.

"First Republic had another very successful year," said Founder, Chairman and CEO Jim Herbert. "Founded in 1985, this was our 35th consecutive year of profitability. First Republic continues to deliver safe, consistent growth, reflecting the strength of our client focused service model."

Full Year Highlights

Financial Results

- Revenues were $3.9 billion, up 17.2%.

- Net interest income was $3.3 billion, up 18.0%.

- Net income was $1.1 billion, up 14.4%.

- Diluted earnings per share of $5.81, up 11.7%.

- Loan originations totaled $50.7 billion (excluding $2.0 billion of originations under the Small Business Administration's Paycheck Protection Program ("PPP")).

- Tangible book value per share was $57.30, up 14.1%.

- Efficiency ratio was 61.9%, compared to 64.2% last year.

Continued Capital and Credit Strength

- Tier 1 leverage ratio was 8.14%.

- Nonperforming assets remained at a low 13 basis points of total assets.

- Net charge-offs were only $2.4 million, or less than 1 basis point of average loans.

Continued Franchise Development

- Loans totaled $110.7 billion, up 21.9% (excluding PPP and for sale loans).

- Deposits were $114.9 billion, up 27.5%.

- Wealth management assets were $194.5 billion, up 28.7%.

- Wealth management revenues were $526.5 million, up 11.9%.

Quarterly Highlights

- Compared to last year's fourth quarter:

- Revenues were $1.1 billion, up 23.1%.

- Net interest income was $892.7 million, up 24.0%.

- Net income was $295.6 million, up 20.0%.

- Diluted earnings per share of $1.60, up 15.1%.

- Loan originations were $16.7 billion.

- Net recoveries were $600,000.

- Net interest margin was 2.73%, compared to 2.71% for the prior quarter.

- Efficiency ratio was 61.6%, compared to 60.7% for the prior quarter.

- Wealth management assets were $194.5 billion, up 15.6% from the prior quarter.

"We're very pleased with the double-digit growth of revenue, net interest income and earnings per share, both for the full year and the fourth quarter," said Mike Roffler, Chief Financial Officer. "We remain focused on maintaining our capital strength and successfully raised, net, over $900 million in new Tier 1 capital in 2020."

Quarterly Cash Dividend of $0.20 per Share

The Bank declared a cash dividend for the fourth quarter of $0.20 per share of common stock, which is payable on February 11, 2021 to shareholders of record as of January 28, 2021. The current quarterly dividend is an increase over last year's fourth quarter dividend, our 9th consecutive year of dividend increases.

Strong Asset Quality

Credit quality remains strong. Nonperforming assets were only 13 basis points of total assets at December 31, 2020.

The provision for credit losses for the full year was $157.1 million, with net loan charge-offs of only $2.4 million. For the quarter, the provision for credit losses was $35.1 million, which was driven by loan growth.

Continued Capital Strength

The Bank's Tier 1 leverage ratio was 8.14%at December 31, 2020, compared to 8.38% at September 30, 2020.

During the fourth quarter, the Bank redeemed all of the outstanding shares of its 5.70% Noncumulative Perpetual Series F Preferred Stock, which totaled $100.0 million. In addition, the Bank sold 1,725,000 new shares of common stock in an underwritten public offering, which added approximately $225.4 million to common equity. Total common stock sold and preferred stock issued in 2020, net of preferred stock redeemed, added $908.0 million of Tier 1 capital in 2020.

The Bank has not and does not engage in common stock buybacks.

Tangible Book Value Growth

Tangible book value per common share at December 31, 2020 was $57.30, up 14.1% from a year ago.

Continued Franchise Development

Loan Originations

Loan originations were $16.7 billion for the quarter, up 48.8% from the same quarter a year ago. For 2020, loan originations (excluding PPP loans) totaled $50.7 billion, up 33.6% compared to the prior year. The increases were primarily due to increases in single family and business lending.

Single family loan originations were 47% of the total volume for the quarter and the full year (excluding PPP loans) and had a weighted average loan-to-value ratio of 56% for the full year. In addition, multifamily and commercial real estate loans originated were 9% of total originations for the quarter and 10% for the year (excluding PPP loans), and had a weighted average loan-to-value ratio of 50% for the year.

Loans, excluding PPP loans and loans held for sale, totaled $110.7 billion at December 31, 2020, up 21.9% compared to a year ago primarily due to increases in single family loans (67% of growth), business and multifamily loans.

COVID-19 Loan Modifications

Remaining loan modifications at year-end to those borrowers experiencing financial challenges as a result of COVID-19 (not classified as troubled debt restructurings) totaled $1.3 billion, and were 1.1% of total loans as of December 31, 2020. Such remaining modifications decreased 67% since September 30, 2020.

The Bank has limited exposure to several of the areas most directly impacted by COVID-19, such as the retail, hotel and restaurant industries, which totaled $2.5 billion as of December 31, 2020, only 2.2% of total loans. As of December 31, 2020, the Bank had modifications of these portfolios for $160 million, or 6%.

Deposit Growth

Total deposits increased to $114.9 billion, up 27.5% compared to a year ago, and had an average rate paid of 11 basis points during the quarter.

At December 31, 2020, checking deposit balances were 66.9% of total deposits.

Investments

Total investment securities at December 31, 2020 were $18.5 billion, a slight decrease compared to the prior quarter and a slight increase compared to a year ago.

High-quality liquid assets, including eligible cash, totaled $18.1 billion at December 31, 2020, and represented 12.8% of quarterly average total assets.

Wealth Management

Total wealth management assets were $194.5 billion at December 31, 2020, up 15.6% for the quarter and up 28.7% compared to a year ago. The increases in wealth management assets were due to both net client inflow and market appreciation.

Wealth management revenues totaled $151.4 million for the quarter, up 17.9% compared to last year's fourth quarter. For 2020, wealth management revenues were $526.5 million, an increase of 11.9% compared to the prior year. Such revenues represented 14.0% of the Bank's total revenues for the quarter and 13.4% of the Bank's total revenues for the year.

Wealth management assets at December 31, 2020 included investment management assets of $83.6 billion, brokerage assets and money market mutual funds of $97.1 billion, and trust and custody assets of $13.8 billion.

Income Statement and Key Ratios

Revenue Growth

Total revenues were $1.1 billion for the quarter, up 23.1% compared to the fourth quarter a year ago, and were $3.9 billion for 2020, up 17.2% compared to the prior year.

Net Interest Income Growth

Net interest income was $892.7 million for the quarter, up 24.0% compared to the fourth quarter a year ago, and was $3.3 billion for 2020, up 18.0% compared to the prior year. The increases in net interest income resulted primarily from growth in average interest-earning assets. The increase for the year was partially offset by a decrease in net interest margin.

Net Interest Margin

The net interest margin increased to 2.73% in the fourth quarter, from 2.71% in the prior quarter. For 2020, the net interest margin was 2.72%, compared to 2.83% for the prior year. The decrease for the year was primarily due to average yields on earning assets declining more than the offsetting decrease in average funding costs.

Noninterest Income

Noninterest income was $187.6 million for the quarter, up 19.3% compared to the fourth quarter a year ago, and was $654.2 million for 2020, up 13.3% compared to the prior year. The increase for the quarter was primarily driven by higher wealth management fees. The increase for the year was primarily driven by higher wealth management fees and an elevated gain on sale of loans, partially offset by lower loan servicing fees.

Noninterest Expense and Efficiency Ratio

Noninterest expense was $666.0 million for the quarter, up 19.2% compared to the fourth quarter a year ago, and was $2.4 billion for 2020, up 13.0% compared to the prior year. The increases were primarily due to increased salaries and benefits and information systems costs from the continued investments in the expansion of the franchise. The increase for the year was partially offset by lower travel and entertainment, as well as advertising and marketing expenses.

The efficiency ratio was 61.6% for the quarter, compared to 63.7% for the fourth quarter a year ago. For 2020, the efficiency ratio was 61.9%, compared to 64.2% for 2019.

Income Taxes

The Bank's effective tax rate for the fourth quarter of 2020 was 22.1%, compared to 19.6% for the prior quarter, and 20.3% for the fourth quarter a year ago. The increase from the prior quarter was primarily due to an increase from state taxes, and a tax refund from an amended tax return in the third quarter of 2020. The increase from the fourth quarter a year ago was primarily the result of lower excess tax benefits from a decrease in stock option exercises by employees, as well as an increase from state taxes.

The effective tax rate for 2020 was 20.2%, compared to 17.9% for 2019. The increase for the year was primarily the result of lower excess tax benefits from a decrease in stock option exercises by employees, partially offset by a tax refund from an amended tax return.

Conference Call Details

First Republic Bank's fourth quarter 2020 earnings conference call is scheduled for January 14, 2021 at 7:00 a.m. PT / 10:00 a.m. ET. To access the event by telephone, please dial (800) 263-0877 and use confirmation code 3942335 approximately 15 minutes prior to the start time (to allow time for registration). International callers should dial +1 (856) 344-9283 and enter the same confirmation code.

The call will also be broadcast live over the Internet and can be accessed in the Investor Relations section of First Republic's website at https://ir.firstrepublic.com/events-calendar. To listen to the live webcast, please visit the site at least 15 minutes prior to the start time to register, download and install any necessary audio software.

For those unable to join the live presentation, a replay of the call will be available beginning January 14, 2021, at 11:00 a.m. PT / 2:00 p.m. ET, through January 21, 2021, at 8:59 p.m. PT / 11:59 p.m. ET. To access the replay, dial (888) 203-1112 and use confirmation code 3942335#. International callers should dial +1 (719) 457-0820 and enter the same confirmation code. A replay of the webcast also will be available for 90 days following, accessible in the Investor Relations section of First Republic Bank's website at https://ir.firstrepublic.com/events-calendar.

The Bank's press releases are available after release in the Newsroom and Investor Relations section of First Republic Bank's website at firstrepublic.com.

About First Republic Bank

Founded in 1985, First Republic and its subsidiaries offer private banking, private business banking and private wealth management, including investment, trust and brokerage services. First Republic specializes in delivering exceptional, relationship-based service and offers a complete line of products, including residential, commercial and personal loans, deposit services, and wealth management. Services are offered through preferred banking or wealth management offices primarily in San Francisco, Palo Alto, Los Angeles, Santa Barbara, Newport Beach and San Diego, California; Portland, Oregon; Boston, Massachusetts; Palm Beach, Florida; Greenwich, Connecticut; New York, New York; and Jackson, Wyoming. First Republic is a constituent of the S&P 500 Index and KBW Nasdaq Bank Index. For more information, visit firstrepublic.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Statements in this press release that are not historical facts are hereby identified as "forward-looking statements" for the purpose of the safe harbor provided by Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Any statements about our expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. These statements are often, but not always, made through the use of words or phrases such as "anticipates," "believes," "can," "could," "may," "predicts," "potential," "should," "will," "estimates," "plans," "projects," "continuing," "ongoing," "expects," "intends" and similar words or phrases. Accordingly, these statements are only predictions and involve estimates, known and unknown risks, assumptions and uncertainties that could cause actual results to differ materially from those expressed in them.

Forward-looking statements involving such risks and uncertainties include, but are not limited to, statements regarding: projections of loans, assets, deposits, liabilities, revenues, expenses, tax liabilities, net income, capital expenditures, liquidity, dividends, capital structure, investments or other financial items; expectations regarding the banking and wealth management industries; descriptions of plans or objectives of management for future operations, products or services; forecasts of future economic conditions generally and in our market areas in particular, which may affect the ability of borrowers to repay their loans and the value of real property or other property held as collateral for such loans; our opportunities for growth and our plans for expansion (including opening new offices); expectations about the performance of any new offices; projections about the amount and the value of intangible assets, as well as amortization of recorded amounts; future provisions for credit losses on loans and debt securities, as well as for unfunded loan commitments; changes in nonperforming assets; expectations regarding the impact and duration of COVID-19; projections about future levels of loan originations or loan repayments; projections regarding costs, including the impact on our efficiency ratio; and descriptions of assumptions underlying or relating to any of the foregoing.

Factors that could cause actual results to differ from those discussed in the forward-looking statements include, but are not limited to: significant competition to attract and retain banking and wealth management customers, from both traditional and non-traditional financial services and technology companies; our ability to recruit and retain key managers, employees and board members; natural or other disasters, including earthquakes, fires, pandemics or acts of terrorism affecting the markets in which we operate; the negative impacts and disruptions resulting from COVID-19 on our colleagues and clients, the communities we serve and the domestic and global economy, which may have an adverse effect on our business, financial position and results of operations; interest rate risk and credit risk; our ability to maintain and follow high underwriting standards; economic and market conditions, including those affecting the valuation of our investment securities portfolio and credit losses on our loans and debt securities; real estate prices generally and in our markets; our geographic and product concentrations; demand for our products and services; developments and uncertainty related to the future use and availability of some reference rates, such as the London Interbank Offered Rate and the 11th District Monthly Weighted Average Cost of Funds Index, as well as other alternative reference rates; the regulatory environment in which we operate, our regulatory compliance and future regulatory requirements; any future changes to regulatory capital requirements; legislative and regulatory actions affecting us and the financial services industry, such as the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Dodd-Frank Act"), including increased compliance costs, limitations on activities and requirements to hold additional capital, as well as changes to the Dodd-Frank Act pursuant to the Economic Growth, Regulatory Relief, and Consumer Protection Act; our ability to avoid litigation and its associated costs and liabilities; future Federal Deposit Insurance Corporation ("FDIC") special assessments or changes to regular assessments; fraud, cybersecurity and privacy risks; and custom technology preferences of our customers and our ability to successfully execute on initiatives relating to enhancements of our technology infrastructure, including client-facing systems and applications. For a discussion of these and other risks and uncertainties, see First Republic's FDIC filings, including, but not limited to, the risk factors in First Republic's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and any subsequent reports filed by First Republic with the FDIC. These filings are available in the Investor Relations section of our website.

All forward-looking statements are necessarily only estimates of future results, and there can be no assurance that actual results will not differ materially from expectations, and, therefore, you are cautioned not to place undue reliance on such statements. Any forward-looking statements are qualified in their entirety by reference to the factors discussed throughout our public filings under the Exchange Act. Further, any forward-looking statement speaks only as of the date on which it is made, and we undertake no obligation to update any forward-looking statement to reflect events or circumstances after the date on which the statement is made or to reflect the occurrence of unanticipated events.

CONSOLIDATED STATEMENTS OF INCOME

Quarter Ended Quarter Ended Year Ended December 31, September 30, December 31, (in thousands,except per 2020 2019 2020 2020 2019share amounts)

Interest income:

Loans $ 845,150 $ 780,326 $ 811,708 $ 3,244,796 $ 2,986,210

Investments 138,429 146,080 142,971 576,484 547,988

Other 5,754 5,679 6,116 23,889 21,446

Cash and cash 1,819 4,869 1,181 7,504 23,835 equivalents

Total interest 991,152 936,954 961,976 3,852,673 3,579,479 income



Interest expense:

Deposits 30,405 128,705 54,355 276,085 500,557

Borrowings 68,019 88,131 77,341 314,036 314,755

Total interest 98,424 216,836 131,696 590,121 815,312 expense



Net interest 892,728 720,118 830,280 3,262,552 2,764,167 income

Provision for 35,066 9,579 28,538 157,091 61,690 credit losses

Net interestincome afterprovision for 857,662 710,539 801,742 3,105,461 2,702,477 creditlosses



Noninterest income:

Investmentmanagement 114,287 97,106 96,638 395,304 359,332 fees

Brokerage andinvestment 11,489 12,416 10,796 50,517 41,035 fees

Insurance fees 5,569 4,186 2,216 11,655 12,708

Trust fees 5,366 4,328 4,543 19,484 16,549

Foreignexchange fee 14,688 10,365 12,575 49,552 41,026 income

Deposit fees 6,115 6,609 5,753 23,713 26,071

Loan and 7,167 6,175 7,171 27,908 19,819 related fees

Loan servicing 1,248 1,788 144 (1,401 ) 11,348 fees, net

Gain on sale 2,412 69 13,797 16,987 535 of loans

Gain (loss) oninvestment 88 (1,541 ) (405 ) 3,840 (3,436 ) securities

Income frominvestments in 16,997 14,034 20,546 53,503 45,570 life insurance

Other income 2,211 1,810 (2,791 ) 3,171 6,663 (loss)

Totalnoninterest 187,637 157,345 170,983 654,233 577,220 income



Noninterest expense:

Salaries andemployee 415,767 325,094 373,225 1,494,400 1,245,526 benefits

Information 79,331 69,278 74,549 298,632 273,337 systems

Occupancy 56,627 50,474 55,543 220,752 192,678

Professional 18,015 22,476 19,845 66,494 68,099 fees

Advertising 13,762 17,615 8,909 43,135 65,961 and marketing

FDIC 11,650 10,912 11,003 44,113 38,759 assessments

Other expenses 70,892 62,996 65,136 258,203 262,101

Totalnoninterest 666,044 558,845 608,210 2,425,729 2,146,461 expense



Income beforeprovision for 379,255 309,039 364,515 1,333,965 1,133,236 income taxes

Provision for 83,695 62,709 71,378 269,814 202,907 income taxes

Net income 295,560 246,330 293,137 1,064,151 930,329

Dividends onpreferred 16,072 10,708 14,816 58,725 49,070 stock

Net incomeavailable to $ 279,488 $ 235,622 $ 278,321 $ 1,005,426 $ 881,259 commonshareholders



Basic earningsper common $ 1.61 $ 1.40 $ 1.62 $ 5.85 $ 5.25 share

Dilutedearnings per $ 1.60 $ 1.39 $ 1.61 $ 5.81 $ 5.20 common share



Weightedaverage 173,111 168,544 172,142 171,933 167,908 shares-basic

Weightedaverage 174,708 169,776 172,932 173,053 169,551 shares-diluted

CONSOLIDATED BALANCE SHEETS

As of

($ in thousands)

December 31,2020

September 30,2020

December 31, 2019 (1)

ASSETS

Cash and cash equivalents

$

5,094,754

$

3,691,149

$

1,699,557

Debt securities available-for-sale

1,906,315

1,711,202

1,282,169

Debt securities held-to-maturity

16,610,212

16,929,422

17,147,633

Less: Allowance for credit losses

(6,902

)

(5,716

)

-

Debt securities held-to-maturity, net

16,603,310

16,923,706

17,147,633

Equity securities (fair value)

20,566

20,478

19,586

Loans: (1)

Single family

61,370,246

56,628,359

47,985,651

Home equity lines of credit

2,449,533

2,431,991

2,501,432

Single family construction

787,854

739,091

761,589

Multifamily

13,768,957

13,392,531

12,353,359

Commercial real estate

8,018,158

7,781,797

7,449,058

Multifamily/commercial construction

2,024,420

2,038,949

1,695,954

Capital call lines of credit

8,149,946

6,203,877

5,570,322

Tax-exempt

3,365,572

3,276,705

3,042,193

Other business

3,340,048

2,982,532

3,034,301

PPP

1,841,376

2,091,102

-

Stock secured

2,518,338

2,311,754

1,897,511

Other secured

1,818,550

1,780,652

1,433,399

Unsecured

3,113,267

3,102,311

3,072,062

Total loans

112,566,265

104,761,651

90,796,831

Allowance for credit losses

(635,019

)

(604,747

)

(496,104

)

Loans, net

111,931,246

104,156,904

90,300,727

Loans held for sale

20,679

33,655

23,304

Investments in life insurance

2,061,362

1,949,360

1,434,642

Tax credit investments

1,131,905

1,099,713

1,100,509

Premises, equipment and leasehold improvements, net

403,482

390,241

386,841

Goodwill and other intangible assets

227,512

229,185

235,269

Other assets

3,101,003

3,020,178

2,633,397

Total Assets

$

142,502,134

$

133,225,771

$

116,263,634

LIABILITIES AND EQUITY

Liabilities:

Deposits:

Noninterest-bearing checking

$

46,281,112

$

41,538,676

$

33,124,265

Interest-bearing checking

30,603,221

26,081,189

19,696,859

Money market checking

16,778,884

15,868,769

12,790,707

Money market savings and passbooks

12,584,522

11,419,289

10,586,355

Certificates of deposit

8,681,061

9,495,453

13,935,060

Total Deposits

114,928,800

104,403,376

90,133,246

Short-term borrowings

-

5,000

800,000

Long-term FHLB advances

11,755,000

13,505,000

12,200,000

Senior notes

996,145

995,626

497,719

Subordinated notes

778,313

778,204

777,885

Other liabilities

2,293,230

2,193,956

2,003,677

Total Liabilities

130,751,488

121,881,162

106,412,527

Shareholders' Equity:

Preferred stock

1,545,000

1,645,000

1,145,000

Common stock

1,741

1,722

1,686

Additional paid-in capital

4,834,172

4,571,499

4,214,915

Retained earnings

5,346,355

5,102,229

4,484,375

Accumulated other comprehensive income

23,378

24,159

5,131

Total Shareholders' Equity

11,750,646

11,344,609

9,851,107

Total Liabilities and Shareholders' Equity

$

142,502,134

$

133,225,771

$

116,263,634

____________

(1) For comparability, the Bank has adjusted certain prior period loan amounts to conform to the current period presentation under the Current Expected Credit Losses ("CECL") methodology.

CONSOLIDATED BALANCE SHEETS

As of

($ in thousands) December 31, September 30, December 31, 2020 2020 2019 ^(1)

ASSETS

Cash and cash $ 5,094,754 $ 3,691,149 $ 1,699,557 equivalents

Debt securities 1,906,315 1,711,202 1,282,169 available-for-sale



Debt securities 16,610,212 16,929,422 17,147,633 held-to-maturity

Less: Allowance for (6,902 ) (5,716 ) - credit losses

Debt securitiesheld-to-maturity, 16,603,310 16,923,706 17,147,633 net



Equity securities 20,566 20,478 19,586 (fair value)



Loans: ^(1)

Single family 61,370,246 56,628,359 47,985,651

Home equity lines 2,449,533 2,431,991 2,501,432 of credit

Single family 787,854 739,091 761,589 construction

Multifamily 13,768,957 13,392,531 12,353,359

Commercial real 8,018,158 7,781,797 7,449,058 estate

Multifamily/commercial 2,024,420 2,038,949 1,695,954 construction

Capital call lines 8,149,946 6,203,877 5,570,322 of credit

Tax-exempt 3,365,572 3,276,705 3,042,193

Other business 3,340,048 2,982,532 3,034,301

PPP 1,841,376 2,091,102 -

Stock secured 2,518,338 2,311,754 1,897,511

Other secured 1,818,550 1,780,652 1,433,399

Unsecured 3,113,267 3,102,311 3,072,062

Total loans 112,566,265 104,761,651 90,796,831

Allowance for (635,019 ) (604,747 ) (496,104 ) credit losses

Loans, net 111,931,246 104,156,904 90,300,727



Loans held for sale 20,679 33,655 23,304

Investments in life 2,061,362 1,949,360 1,434,642 insurance

Tax credit 1,131,905 1,099,713 1,100,509 investments

Premises, equipmentand leasehold 403,482 390,241 386,841 improvements, net

Goodwill and other 227,512 229,185 235,269 intangible assets

Other assets 3,101,003 3,020,178 2,633,397

Total Assets $ 142,502,134 $ 133,225,771 $ 116,263,634



LIABILITIES AND EQUITY

Liabilities:

Deposits:

Noninterest-bearing $ 46,281,112 $ 41,538,676 $ 33,124,265 checking

Interest-bearing 30,603,221 26,081,189 19,696,859 checking

Money market 16,778,884 15,868,769 12,790,707 checking

Money marketsavings and 12,584,522 11,419,289 10,586,355 passbooks

Certificates of 8,681,061 9,495,453 13,935,060 deposit

Total Deposits 114,928,800 104,403,376 90,133,246



Short-term - 5,000 800,000 borrowings

Long-term FHLB 11,755,000 13,505,000 12,200,000 advances

Senior notes 996,145 995,626 497,719

Subordinated notes 778,313 778,204 777,885

Other liabilities 2,293,230 2,193,956 2,003,677

Total Liabilities 130,751,488 121,881,162 106,412,527



Shareholders' Equity:

Preferred stock 1,545,000 1,645,000 1,145,000

Common stock 1,741 1,722 1,686

Additional paid-in 4,834,172 4,571,499 4,214,915 capital

Retained earnings 5,346,355 5,102,229 4,484,375

Accumulated othercomprehensive 23,378 24,159 5,131 income

Total Shareholders' 11,750,646 11,344,609 9,851,107 Equity

Total Liabilitiesand Shareholders' $ 142,502,134 $ 133,225,771 $ 116,263,634 Equity

____________

^(1) For comparability, the Bank has adjusted certain prior period loan amountsto conform to the current period presentation under the Current Expected CreditLosses ("CECL") methodology.

Quarter Ended December 31,

Quarter Ended September 30,

2020

2019 (4)

2020

Average Balances, Yieldsand Rates

Average Balance

Interest Income/Expense (1)

Yields/ Rates (2)

Average Balance

Interest Income/Expense (1)

Yields/ Rates (2)

Average Balance

Interest Income/Expense (1)

Yields/ Rates (2)

($ in thousands)

Assets:

Cash and cash equivalents

$

6,965,598

$

1,819

0.10

%

$

1,377,686

$

4,869

1.40

%

$

4,427,985

$

1,181

0.11

%

Investment securities:

U.S. Government-sponsored agency securities

50,000

196

1.57

%

461,671

3,239

2.81

%

202,174

1,186

2.35

%

Agency residential and commercial MBS

5,786,312

32,237

2.23

%

6,826,144

47,764

2.80

%

6,250,577

37,437

2.40

%

Other residential and commercial MBS

35,437

184

2.08

%

4,276

39

3.66

%

37,860

201

2.13

%

Municipal securities

12,638,677

130,938

4.14

%

10,981,068

116,245

4.23

%

12,309,647

129,097

4.19

%

Other investment

securities (3)

76,272

511

2.68

%

43,840

322

2.94

%

44,782

309

2.76

%

Total investment securities

18,586,698

164,066

3.53

%

18,316,999

167,609

3.66

%

18,845,040

168,230

3.57

%

Loans: (4)

Residential real estate (5)

61,523,322

445,028

2.89

%

48,938,892

391,415

3.20

%

56,906,612

421,545

2.96

%

Multifamily (6)

13,596,444

125,042

3.60

%

12,043,858

118,431

3.85

%

13,312,631

124,759

3.67

%

Commercial real estate

7,909,682

78,599

3.89

%

7,414,885

78,229

4.13

%

7,801,603

78,412

3.93

%

Multifamily/commercial construction

2,788,321

31,588

4.43

%

2,415,923

28,931

4.69

%

2,739,717

30,608

4.37

%

Business (7)

13,382,558

115,809

3.39

%

11,556,437

121,665

4.12

%

12,538,201

110,487

3.45

%

PPP

2,004,127

14,419

2.82

%

-

-

-

%

2,091,580

10,825

2.03

%

Other (8)

7,253,376

41,385

2.23

%

6,085,084

48,261

3.10

%

6,995,592

41,735

2.33

%

Total loans

108,457,830

851,870

3.11

%

88,455,079

786,932

3.52

%

102,385,936

818,371

3.16

%

FHLB stock

412,789

5,754

5.55

%

394,487

5,678

5.71

%

457,808

6,116

5.31

%

Total interest-earning assets

134,422,915

1,023,509

3.02

%

108,544,251

965,088

3.52

%

126,116,769

993,898

3.12

%

Noninterest-earning cash

452,927

362,139

433,852

Goodwill and other intangibles

228,315

256,614

230,051

Other assets

5,706,213

4,581,436

5,074,504

Total noninterest-earning assets

6,387,455

5,200,189

5,738,407

Total Assets

$

140,810,370

$

113,744,440

$

131,855,176

Liabilities and Equity:

Deposits:

Checking

$

73,876,676

2,214

0.01

%

$

51,333,186

8,777

0.07

%

$

64,895,753

2,413

0.01

%

Money market checking and savings

29,149,550

14,139

0.19

%

21,298,741

49,682

0.93

%

26,220,043

13,675

0.21

%

CDs

8,813,489

14,052

0.63

%

13,694,721

70,246

2.04

%

11,334,100

38,267

1.34

%

Total deposits

111,839,715

30,405

0.11

%

86,326,648

128,705

0.59

%

102,449,896

54,355

0.21

%

Borrowings:

Short-term borrowings

8,638

4

0.17

%

3,056,545

13,530

1.76

%

5,030

0

0.00

%

Long-term FHLB advances

13,298,478

52,873

1.58

%

11,488,043

62,146

2.15

%

14,739,238

62,201

1.68

%

Senior notes (9)

995,892

6,034

2.42

%

497,610

3,351

2.69

%

995,373

6,032

2.42

%

Subordinated notes (9)

778,260

9,108

4.68

%

777,834

9,104

4.68

%

778,151

9,108

4.68

%

Total borrowings

15,081,268

68,019

1.80

%

15,820,032

88,131

2.21

%

16,517,792

77,341

1.86

%

Total interest-bearing liabilities

126,920,983

98,424

0.31

%

102,146,680

216,836

0.84

%

118,967,688

131,696

0.44

%

Noninterest-bearing liabilities

2,341,078

2,093,561

2,082,793

Preferred equity

1,552,609

899,728

1,226,522

Common equity

9,995,700

8,604,471

9,578,173

Total Liabilities and Equity

$

140,810,370

$

113,744,440

$

131,855,176

Net interest spread (10)

2.71

%

2.68

%

2.68

%

Net interest income (fully

taxable-equivalent basis) and

net interest margin (11)

$

925,085

2.73

%

$

748,252

2.73

%

$

862,202

2.71

%

Reconciliation of tax-equivalent net interestincome to reported net interest income:

Tax-equivalent adjustment

(32,357

)

(28,134

)

(31,922

)

Net interest income, as reported

$

892,728

$

720,118

$

830,280

Quarter Ended December 31, Quarter Ended September 30,

2020 2019 ^(4) 2020

Interest Yields Interest Yields Interest YieldsAverage Balances, Yields Average Income/ / Average Income/ / Average Income/ /and Rates Balance Expense Rates Balance Expense Rates Balance Expense Rates ^(1) ^(2) ^(1) ^(2) ^(1) ^(2)

($ in thousands)

Assets:

Cash and cash equivalents $ 6,965,598 $ 1,819 0.10 % $ 1,377,686 $ 4,869 1.40 % $ 4,427,985 $ 1,181 0.11 %

Investment securities:

U.S. Government-sponsored 50,000 196 1.57 % 461,671 3,239 2.81 % 202,174 1,186 2.35 %agency securities

Agency residential and 5,786,312 32,237 2.23 % 6,826,144 47,764 2.80 % 6,250,577 37,437 2.40 %commercial MBS

Other residential and 35,437 184 2.08 % 4,276 39 3.66 % 37,860 201 2.13 %commercial MBS

Municipal securities 12,638,677 130,938 4.14 % 10,981,068 116,245 4.23 % 12,309,647 129,097 4.19 %

Other investment 76,272 511 2.68 % 43,840 322 2.94 % 44,782 309 2.76 %securities^ (3)

Total investment 18,586,698 164,066 3.53 % 18,316,999 167,609 3.66 % 18,845,040 168,230 3.57 %securities



Loans: ^(4)

Residential real estate ^ 61,523,322 445,028 2.89 % 48,938,892 391,415 3.20 % 56,906,612 421,545 2.96 %(5)

Multifamily ^(6) 13,596,444 125,042 3.60 % 12,043,858 118,431 3.85 % 13,312,631 124,759 3.67 %

Commercial real estate 7,909,682 78,599 3.89 % 7,414,885 78,229 4.13 % 7,801,603 78,412 3.93 %

Multifamily/commercial 2,788,321 31,588 4.43 % 2,415,923 28,931 4.69 % 2,739,717 30,608 4.37 %construction

Business ^(7) 13,382,558 115,809 3.39 % 11,556,437 121,665 4.12 % 12,538,201 110,487 3.45 %

PPP 2,004,127 14,419 2.82 % - - - % 2,091,580 10,825 2.03 %

Other ^(8) 7,253,376 41,385 2.23 % 6,085,084 48,261 3.10 % 6,995,592 41,735 2.33 %

Total loans 108,457,830 851,870 3.11 % 88,455,079 786,932 3.52 % 102,385,936 818,371 3.16 %

FHLB stock 412,789 5,754 5.55 % 394,487 5,678 5.71 % 457,808 6,116 5.31 %

Total interest-earning 134,422,915 1,023,509 3.02 % 108,544,251 965,088 3.52 % 126,116,769 993,898 3.12 %assets



Noninterest-earning cash 452,927 362,139 433,852

Goodwill and other 228,315 256,614 230,051 intangibles

Other assets 5,706,213 4,581,436 5,074,504

Total noninterest-earning 6,387,455 5,200,189 5,738,407 assets

Total Assets $ 140,810,370 $ 113,744,440 $ 131,855,176



Liabilities and Equity:

Deposits:

Checking $ 73,876,676 2,214 0.01 % $ 51,333,186 8,777 0.07 % $ 64,895,753 2,413 0.01 %

Money market checking and 29,149,550 14,139 0.19 % 21,298,741 49,682 0.93 % 26,220,043 13,675 0.21 %savings

CDs 8,813,489 14,052 0.63 % 13,694,721 70,246 2.04 % 11,334,100 38,267 1.34 %

Total deposits 111,839,715 30,405 0.11 % 86,326,648 128,705 0.59 % 102,449,896 54,355 0.21 %



Borrowings:

Short-term borrowings 8,638 4 0.17 % 3,056,545 13,530 1.76 % 5,030 0 0.00 %

Long-term FHLB advances 13,298,478 52,873 1.58 % 11,488,043 62,146 2.15 % 14,739,238 62,201 1.68 %

Senior notes^ (9) 995,892 6,034 2.42 % 497,610 3,351 2.69 % 995,373 6,032 2.42 %

Subordinated notes ^(9) 778,260 9,108 4.68 % 777,834 9,104 4.68 % 778,151 9,108 4.68 %

Total borrowings 15,081,268 68,019 1.80 % 15,820,032 88,131 2.21 % 16,517,792 77,341 1.86 %

Total interest-bearing 126,920,983 98,424 0.31 % 102,146,680 216,836 0.84 % 118,967,688 131,696 0.44 %liabilities



Noninterest-bearing 2,341,078 2,093,561 2,082,793 liabilities

Preferred equity 1,552,609 899,728 1,226,522

Common equity 9,995,700 8,604,471 9,578,173

Total Liabilities and $ 140,810,370 $ 113,744,440 $ 131,855,176 Equity



Net interest spread ^(10) 2.71 % 2.68 % 2.68 %

Net interest income (fully

taxable-equivalent basis) $ 925,085 2.73 % $ 748,252 2.73 % $ 862,202 2.71 %and

net interest margin^ (11)



Reconciliation of tax-equivalent netinterest income to reported net interest income:

Tax-equivalent adjustment (32,357 ) (28,134 ) (31,922 )

Net interest income, as reported $ 892,728 $ 720,118 $ 830,280

Year Ended December 31,

2020

2019 (4)

Average Balances, Yields and Rates

Average Balance

Interest Income/Expense (1)

Yields/Rates

Average Balance

Interest Income/Expense (1)

Yields/Rates

($ in thousands)

Assets:

Cash and cash equivalents

$

4,018,429

$

7,504

0.19

%

$

1,268,405

$

23,835

1.88

%

Investment securities:

U.S. Government-sponsored agency securities

193,246

4,957

2.56

%

818,000

24,066

2.94

%

Agency residential and commercial MBS

6,348,004

159,520

2.51

%

6,735,598

191,869

2.85

%

Other residential and commercial MBS

26,215

600

2.29

%

4,450

170

3.83

%

Municipal securities

12,066,413

510,825

4.23

%

9,218,509

409,127

4.44

%

Other investment securities (3)

52,204

1,447

2.77

%

26,848

726

2.70

%

Total investment securities

18,686,082

677,349

3.62

%

16,803,405

625,958

3.73

%

Loans: (4)

Residential real estate (5)

55,885,085

1,676,247

3.00

%

44,655,754

1,465,364

3.28

%

Multifamily (6)

13,092,607

489,402

3.68

%

11,248,189

439,408

3.85

%

Commercial real estate

7,751,600

313,254

3.97

%

7,088,827

301,831

4.20

%

Multifamily/commercial construction

2,678,312

121,949

4.48

%

2,319,279

114,902

4.89

%

Business (7)

12,845,826

465,101

3.56

%

11,302,160

503,782

4.40

%

PPP

1,432,501

32,903

2.26

%

-

-

-

%

Other (8)

6,841,682

172,808

2.48

%

5,559,309

187,536

3.33

%

Total loans

100,527,613

3,271,664

3.23

%

82,173,518

3,012,823

3.64

%

FHLB stock

442,338

23,889

5.40

%

331,862

21,446

6.46

%

Total interest-earning assets

123,674,462

3,980,406

3.20

%

100,577,190

3,684,062

3.64

%

Noninterest-earning cash

438,893

347,065

Goodwill and other intangibles

231,084

266,062

Other assets

5,103,458

4,376,016

Total noninterest-earning assets

5,773,435

4,989,143

Total Assets

$

129,447,897

$

105,566,333

Liabilities and Equity:

Deposits:

Checking

$

62,938,940

16,186

0.03

%

$

48,097,161

30,318

0.06

%

Money market checking and savings

25,506,568

87,908

0.34

%

20,113,724

196,582

0.98

%

CDs

11,754,513

171,991

1.46

%

12,769,459

273,657

2.14

%

Total deposits

100,200,021

276,085

0.28

%

80,980,344

500,557

0.62

%

Borrowings:

Short-term borrowings

310,392

4,704

1.52

%

2,278,831

50,361

2.21

%

Long-term FHLB advances

14,330,041

250,031

1.74

%

9,738,767

209,816

2.15

%

Senior notes (9)

938,185

22,873

2.44

%

680,199

18,169

2.67

%

Subordinated notes (9)

778,099

36,428

4.68

%

777,681

36,409

4.68

%

Total borrowings

16,356,717

314,036

1.92

%

13,475,478

314,755

2.34

%

Total interest-bearing liabilities

116,556,738

590,121

0.51

%

94,455,822

815,312

0.86

%

Noninterest-bearing liabilities

2,130,829

1,859,115

Preferred equity

1,267,951

929,849

Common equity

9,492,379

8,321,547

Total Liabilities and Equity

$

129,447,897

$

105,566,333

Net interest spread (10)

2.69

%

2.78

%

Net interest income (fully taxable-equivalent basis) and

net interest margin (11)

$

3,390,285

2.72

%

$

2,868,750

2.83

%

Reconciliation of tax-equivalent net interest incometo reported net interest income:

Tax-equivalent adjustment

(127,733

)

(104,583

)

Net interest income, as reported

$

3,262,552

$

2,764,167

Year Ended December 31,

2020 2019 ^(4)

Average Balances, Average Interest Yields Average Interest YieldsYields and Rates Balance Income/Expense / Balance Income/Expense / ^(1) Rates ^(1) Rates

($ in thousands)

Assets:

Cash and cash $ 4,018,429 $ 7,504 0.19 % $ 1,268,405 $ 23,835 1.88 %equivalents

Investment securities:

U.S.Government-sponsored 193,246 4,957 2.56 % 818,000 24,066 2.94 %agency securities

Agency residential 6,348,004 159,520 2.51 % 6,735,598 191,869 2.85 %and commercial MBS

Other residential 26,215 600 2.29 % 4,450 170 3.83 %and commercial MBS

Municipal securities 12,066,413 510,825 4.23 % 9,218,509 409,127 4.44 %

Other investment 52,204 1,447 2.77 % 26,848 726 2.70 %securities^ (3)

Total investment 18,686,082 677,349 3.62 % 16,803,405 625,958 3.73 %securities



Loans: ^(4)

Residential real 55,885,085 1,676,247 3.00 % 44,655,754 1,465,364 3.28 %estate ^(5)

Multifamily ^(6) 13,092,607 489,402 3.68 % 11,248,189 439,408 3.85 %

Commercial real 7,751,600 313,254 3.97 % 7,088,827 301,831 4.20 %estate

Multifamily/commercial 2,678,312 121,949 4.48 % 2,319,279 114,902 4.89 %construction

Business ^(7) 12,845,826 465,101 3.56 % 11,302,160 503,782 4.40 %

PPP 1,432,501 32,903 2.26 % - - - %

Other ^(8) 6,841,682 172,808 2.48 % 5,559,309 187,536 3.33 %

Total loans 100,527,613 3,271,664 3.23 % 82,173,518 3,012,823 3.64 %

FHLB stock 442,338 23,889 5.40 % 331,862 21,446 6.46 %

Totalinterest-earning 123,674,462 3,980,406 3.20 % 100,577,190 3,684,062 3.64 %assets



Noninterest-earning 438,893 347,065 cash

Goodwill and other 231,084 266,062 intangibles

Other assets 5,103,458 4,376,016

Totalnoninterest-earning 5,773,435 4,989,143 assets

Total Assets $ 129,447,897 $ 105,566,333



Liabilities and Equity:

Deposits:

Checking $ 62,938,940 16,186 0.03 % $ 48,097,161 30,318 0.06 %

Money market 25,506,568 87,908 0.34 % 20,113,724 196,582 0.98 %checking and savings

CDs 11,754,513 171,991 1.46 % 12,769,459 273,657 2.14 %

Total deposits 100,200,021 276,085 0.28 % 80,980,344 500,557 0.62 %



Borrowings:

Short-term 310,392 4,704 1.52 % 2,278,831 50,361 2.21 %borrowings

Long-term FHLB 14,330,041 250,031 1.74 % 9,738,767 209,816 2.15 %advances

Senior notes ^(9) 938,185 22,873 2.44 % 680,199 18,169 2.67 %

Subordinated notes ^ 778,099 36,428 4.68 % 777,681 36,409 4.68 %(9)

Total borrowings 16,356,717 314,036 1.92 % 13,475,478 314,755 2.34 %

Totalinterest-bearing 116,556,738 590,121 0.51 % 94,455,822 815,312 0.86 %liabilities



Noninterest-bearing 2,130,829 1,859,115 liabilities

Preferred equity 1,267,951 929,849

Common equity 9,492,379 8,321,547

Total Liabilities $ 129,447,897 $ 105,566,333 and Equity



Net interest spread 2.69 % 2.78 %^(10)

Net interest income(fullytaxable-equivalentbasis) and $ 3,390,285 2.72 % $ 2,868,750 2.83 %

net interest margin^(11)



Reconciliation oftax-equivalent netinterest income to reported netinterest income:

Tax-equivalent (127,733 ) (104,583 ) adjustment

Net interest income, $ 3,262,552 $ 2,764,167 as reported

__________

(1) Interest income is presented on a fully taxable-equivalent basis.

(2) Yields/rates are annualized.

(3) Includes corporate debt securities, mutual funds and marketable equity securities.

(4) For comparability, the Bank has adjusted certain prior period loan amounts to conform to the current period presentation under CECL.

(5) Includes single family, home equity lines of credit, and single family construction loans. Also includes single family loans held for sale.

(6) Includes multifamily loans held for sale.

(7) Includes capital call lines of credit, tax-exempt and other business loans.

(8) Includes stock secured, other secured and unsecured loans.

(9) Average balances include unamortized issuance discounts and costs. Interest expense includes amortization of issuance discounts and costs.

(10) Net interest spread represents the average yield on interest-earning assets less the average rate on interest-bearing liabilities.

(11) Net interest margin represents net interest income on a fully taxable-equivalent basis divided by total average interest-earning assets.

__________

^(1) Interest income is presented on a fully taxable-equivalent basis.

^(2) Yields/rates are annualized.

^(3) Includes corporate debt securities, mutual funds and marketable equitysecurities.

^(4) For comparability, the Bank has adjusted certain prior period loan amountsto conform to the current period presentation under CECL.

^(5) Includes single family, home equity lines of credit, and single familyconstruction loans. Also includes single family loans held for sale.

^(6) Includes multifamily loans held for sale.

^(7) Includes capital call lines of credit, tax-exempt and other businessloans.

^(8) Includes stock secured, other secured and unsecured loans.

^(9) Average balances include unamortized issuance discounts and costs.Interest expense includes amortization of issuance discounts and costs.

^(10) Net interest spread represents the average yield on interest-earningassets less the average rate on interest-bearing liabilities.

^(11) Net interest margin represents net interest income on a fullytaxable-equivalent basis divided by total average interest-earning assets.

Quarter EndedDecember 31,

Quarter EndedSeptember 30,

Year EndedDecember 31,

Operating Information

2020

2019

2020

2020

2019

($ in thousands, except per share amounts)

Net income to average assets (1)

0.84

%

0.86

%

0.88

%

0.82

%

0.88

%

Net income available to common shareholders to

average common equity (1)

11.12

%

10.86

%

11.56

%

10.59

%

10.59

%

Net income available to common shareholders to

average tangible common equity (1)

11.38

%

11.20

%

11.84

%

10.86

%

10.94

%

Dividends per common share

$

0.20

$

0.19

$

0.20

$

0.79

$

0.75

Dividend payout ratio

12.5

%

13.7

%

12.4

%

13.6

%

14.4

%

Efficiency ratio (2), (3)

61.6

%

63.7

%

60.7

%

61.9

%

64.2

%

Net loan charge-offs (recoveries)

$

(600

)

$

(1,060

)

$

1,687

$

2,387

$

4,634

Net loan charge-offs (recoveries) to average total

loans (1)

(0.00

)

%

(0.00

)

%

0.01

%

0.00

%

0.01

%

Allowance for loan credit losses to:

Total loans

0.56

%

0.55

%

0.58

%

0.56

%

0.55

%

Nonaccrual loans

344.9

%

346.5

%

368.2

%

344.9

%

346.5

%

__________

(1) For periods less than a year, ratios are annualized.

(2) Efficiency ratio is the ratio of noninterest expense to the sum of net interest income and noninterest income.

(3) The provision for unfunded loan commitments is included in the provision for credit losses for 2020 periods. For 2019 periods, the provision for unfunded loan commitments is included in other noninterest expense.

Quarter Quarter Ended Ended Year Ended December 31, September December 31, 30,

Operating 2020 2019 2020 2020 2019Information

($ inthousands, except pershare amounts)

Net income toaverage assets 0.84 % 0.86 % 0.88 % 0.82 % 0.88 %^(1)

Net incomeavailable tocommonshareholders to 11.12 % 10.86 % 11.56 % 10.59 % 10.59 %

average commonequity ^(1)

Net incomeavailable tocommonshareholders to 11.38 % 11.20 % 11.84 % 10.86 % 10.94 %

averagetangible commonequity ^(1)

Dividends per $ 0.20 $ 0.19 $ 0.20 $ 0.79 $ 0.75 common share

Dividend payout 12.5 % 13.7 % 12.4 % 13.6 % 14.4 %ratio

Efficiency 61.6 % 63.7 % 60.7 % 61.9 % 64.2 %ratio ^(2), (3)



Net loancharge-offs $ (600 ) $ (1,060 ) $ 1,687 $ 2,387 $ 4,634 (recoveries)

Net loancharge-offs(recoveries) to (0.00 ) % (0.00 ) % 0.01 % 0.00 % 0.01 %average total

loans ^(1)



Allowance forloan credit losses to:

Total loans 0.56 % 0.55 % 0.58 % 0.56 % 0.55 %

Nonaccrual 344.9 % 346.5 % 368.2 % 344.9 % 346.5 %loans

__________

^(1) For periods less than a year, ratios are annualized.

^(2) Efficiency ratio is the ratio of noninterest expense to the sum of netinterest income and noninterest income.

^(3) The provision for unfunded loan commitments is included in the provisionfor credit losses for 2020 periods. For 2019 periods, the provision forunfunded loan commitments is included in other noninterest expense.

Quarter EndedDecember 31,

Quarter EndedSeptember 30,

Year EndedDecember 31,

Effective Tax Rate

2020

2019

2020

2020

2019

Effective tax rate, prior to excess tax benefits and tax refund from an amended tax return

22.5

%

21.6

%

21.1

%

21.9

%

21.4

%

Excess tax benefits-stock options

-

(1.2

)

(0.1

)

(0.6

)

(2.9

)

Excess tax benefits-other stock awards

(0.4

)

(0.1

)

(0.1

)

(0.7

)

(0.6

)

Total excess tax benefits

(0.4

)

(1.3

)

(0.2

)

(1.3

)

(3.5

)

Tax refund from an amended tax return

-

-

(1.3

)

(0.4

)

-

Effective tax rate

22.1

%

20.3

%

19.6

%

20.2

%

17.9

%

Quarter Quarter Ended Ended Year Ended December 31, September December 31, 30,

Effective Tax Rate 2020 2019 2020 2020 2019

Effective tax rate,prior to excess taxbenefits and 22.5 % 21.6 % 21.1 % 21.9 % 21.4 %tax refund from anamended tax return



Excess tax - (1.2 ) (0.1 ) (0.6 ) (2.9 ) benefits-stock options

Excess taxbenefits-other stock (0.4 ) (0.1 ) (0.1 ) (0.7 ) (0.6 ) awards

Total excess tax (0.4 ) (1.3 ) (0.2 ) (1.3 ) (3.5 ) benefits



Tax refund from an - - (1.3 ) (0.4 ) - amended tax return

Effective tax rate 22.1 % 20.3 % 19.6 % 20.2 % 17.9 %



Provision for Credit Losses

Quarter EndedDecember 31,

Quarter EndedSeptember 30,

Year EndedDecember 31,

2020

2019

2020

2020

2019

($ in thousands)

Debt securities held-to-maturity

$

1,186

$

-

$

333

$

2,233

$

-

Loans

29,672

9,579

22,437

142,977

61,690

Unfunded loan commitments (1)

4,208

-

5,768

11,881

-

Total provision

$

35,066

$

9,579

$

28,538

$

157,091

$

61,690

__________

(1) The provision for unfunded loan commitments is included in the provision for credit losses for 2020 periods. For 2019 periods, the provision for unfunded loan commitments is included in other noninterest expense, which is not presented in this table.

Quarter Quarter Ended Ended Year EndedProvision for December 31, September December 31,Credit Losses 30,

2020 2019 2020 2020 2019

($ in thousands)

Debt securities $ 1,186 $ - $ 333 $ 2,233 $ - held-to-maturity

Loans 29,672 9,579 22,437 142,977 61,690

Unfunded loan 4,208 - 5,768 11,881 - commitments ^(1)

Total provision $ 35,066 $ 9,579 $ 28,538 $ 157,091 $ 61,690

__________

^(1) The provision for unfunded loan commitments is included in the provisionfor credit losses for 2020 periods. For 2019 periods, the provision forunfunded loan commitments is included in other noninterest expense, which isnot presented in this table.

Quarter EndedDecember 31, 2020

Year EndedDecember 31, 2020

Allowance for CreditLosses

Debt Securities Held-to- Maturity

Loans

Unfunded Loan Commitments (1)

Total

Debt Securities Held-to- Maturity

Loans

Unfunded Loan Commitments (1)

Total

($ in thousands)

Balance at beginning of

period (2)

$

5,716

$

604,747

$

23,370

$

633,833

$

4,669

$

494,429

$

15,697

$

514,795

Provision for credit losses

1,186

29,672

4,208

35,066

2,233

142,977

11,881

157,091

Net (charge-offs) recoveries

-

600

-

600

-

(2,387

)

-

(2,387

)

Balance at end of period

$

6,902

$

635,019

$

27,578

$

669,499

$

6,902

$

635,019

$

27,578

$

669,499

__________

(1) The allowance for credit losses on unfunded loan commitments is included in other liabilities.

(2) For the year ended December 31, 2020, represents the balance after the cumulative effect adjustment from the adoption of CECL.

Quarter Ended Year Ended December 31, 2020 December 31, 2020

Debt Unfunded Debt UnfundedAllowance for Credit Securities Loans Loan Total Securities Loans Loan TotalLosses Held-to- Commitments Held-to- Commitments Maturity ^(1) Maturity ^(1)

($ in thousands)

Balance at beginningof $ 5,716 $ 604,747 $ 23,370 $ 633,833 $ 4,669 $ 494,429 $ 15,697 $ 514,795

period ^(2)

Provision for credit 1,186 29,672 4,208 35,066 2,233 142,977 11,881 157,091 losses

Net (charge-offs) - 600 - 600 - (2,387 ) - (2,387 ) recoveries

Balance at end of $ 6,902 $ 635,019 $ 27,578 $ 669,499 $ 6,902 $ 635,019 $ 27,578 $ 669,499 period

__________

^(1) The allowance for credit losses on unfunded loan commitments is includedin other liabilities.

^(2) For the year ended December 31, 2020, represents the balance after thecumulative effect adjustment from the adoption of CECL.

Quarter EndedDecember 31,

Quarter EndedSeptember 30,

Year EndedDecember 31,

Mortgage Loan Sales

2020

2019

2020

2020

2019

($ in thousands)

Loans sold:

Flow sales:

Agency

$

152,210

$

34,519

$

44,118

$

232,912

$

85,945

Non-agency

-

7,717

-

31,870

50,983

Total flow sales

152,210

42,236

44,118

264,782

136,928

Bulk sales:

Non-agency

-

-

235,732

673,401

152,119

Securitizations

-

-

-

300,116

-

Total loans sold

$

152,210

$

42,236

$

279,850

$

1,238,299

$

289,047

Gain on sale of loans:

Amount (1)

$

2,412

$

69

$

13,797

$

16,987

$

535

Gain as a percentage of loans sold (1)

1.58

%

0.16

%

4.93

%

1.37

%

0.19

%

__________

(1) The gain for the quarter ended September 30, 2020 and full year 2020 included $10.3 million related to realized discounts on previously purchased loans when these loans were sold. Excluding these discounts of $10.3 million, the gain as a percentage of loans sold was 1.24% and 0.54% for the quarter ended September 30, 2020 and full year 2020, respectively.

Quarter Quarter Ended Ended Year Ended December 31, September December 31, 30,

Mortgage Loan 2020 2019 2020 2020 2019Sales

($ in thousands)

Loans sold:

Flow sales:

Agency $ 152,210 $ 34,519 $ 44,118 $ 232,912 $ 85,945

Non-agency - 7,717 - 31,870 50,983

Total flow 152,210 42,236 44,118 264,782 136,928 sales



Bulk sales:

Non-agency - - 235,732 673,401 152,119



Securitizations - - - 300,116 -



Total loans $ 152,210 $ 42,236 $ 279,850 $ 1,238,299 $ 289,047 sold



Gain on sale of loans:

Amount ^(1) $ 2,412 $ 69 $ 13,797 $ 16,987 $ 535

Gain as apercentage of 1.58 % 0.16 % 4.93 % 1.37 % 0.19 %loans sold ^(1)

__________

^(1) The gain for the quarter ended September 30, 2020 and full year 2020included $10.3 million related to realized discounts on previously purchasedloans when these loans were sold. Excluding these discounts of $10.3 million,the gain as a percentage of loans sold was 1.24% and 0.54% for the quarterended September 30, 2020 and full year 2020, respectively.

Quarter EndedDecember 31,

Quarter EndedSeptember 30,

Year EndedDecember 31,

Loan Originations

2020

2019 (1)

2020

2020 (2)

2019 (1)

($ in thousands)

Single family

$

7,777,589

$

5,275,965

$

6,813,850

$

23,985,959

$

16,405,784

Home equity lines of credit

619,257

456,150

432,443

1,904,945

1,524,031

Single family construction

223,909

133,368

186,833

639,222

588,429

Multifamily

1,016,575

1,214,394

955,951

3,700,649

3,320,158

Commercial real estate

437,947

401,084

193,228

1,413,716

1,710,820

Multifamily/commercial construction

303,054

340,650

245,220

1,300,609

1,175,922

Capital call lines of credit

3,854,094

1,708,006

1,803,907

9,448,577

7,171,710

Tax-exempt

305,826

52,550

328,711

918,610

287,020

Other business

771,484

512,954

243,788

2,549,308

1,621,666

PPP

-

-

-

1,981,797

-

Stock secured

669,840

650,240

685,250

2,467,066

1,769,385

Other secured

412,902

170,231

189,386

1,374,842

1,011,232

Unsecured

312,809

308,360

159,379

998,346

1,377,319

Total loans originated

$

16,705,286

$

11,223,952

$

12,237,946

$

52,683,646

$

37,963,476

__________

(1) For comparability, the Bank has adjusted certain prior period amounts to conform to the current period presentation under CECL.

(2) Excluding PPP loan originations, total loan originations were $50.7 billion for the year ended December 31, 2020.

Quarter Ended Quarter Ended Year Ended December 31, September 30, December 31,

Loan 2020 2019 ^(1) 2020 2020 ^(2) 2019 ^(1)Originations

($ in thousands)

Single $ 7,777,589 $ 5,275,965 $ 6,813,850 $ 23,985,959 $ 16,405,784 family

Home equitylines of 619,257 456,150 432,443 1,904,945 1,524,031 credit

Singlefamily 223,909 133,368 186,833 639,222 588,429 construction

Multifamily 1,016,575 1,214,394 955,951 3,700,649 3,320,158

Commercial 437,947 401,084 193,228 1,413,716 1,710,820 real estate

Multifamily/commercial 303,054 340,650 245,220 1,300,609 1,175,922 construction

Capital calllines of 3,854,094 1,708,006 1,803,907 9,448,577 7,171,710 credit

Tax-exempt 305,826 52,550 328,711 918,610 287,020

Other 771,484 512,954 243,788 2,549,308 1,621,666 business

PPP - - - 1,981,797 -

Stock 669,840 650,240 685,250 2,467,066 1,769,385 secured

Other 412,902 170,231 189,386 1,374,842 1,011,232 secured

Unsecured 312,809 308,360 159,379 998,346 1,377,319

Total loans $ 16,705,286 $ 11,223,952 $ 12,237,946 $ 52,683,646 $ 37,963,476 originated

__________

^(1) For comparability, the Bank has adjusted certain prior period amounts toconform to the current period presentation under CECL.

^(2) Excluding PPP loan originations, total loan originations were $50.7billion for the year ended December 31, 2020.

As of

Asset Quality Information

December 31,2020

September 30,2020

June 30,2020

March 31,2020

December 31,2019

($ in thousands)

Nonperforming assets:

Nonaccrual loans

$

184,132

$

164,247

$

164,930

$

125,418

$

143,181

Other real estate owned

-

-

1,071

1,071

-

Total nonperforming assets

$

184,132

$

164,247

$

166,001

$

126,489

$

143,181

Nonperforming assets to total assets

0.13

%

0.12

%

0.13

%

0.10

%

0.12

%

Accruing loans 90 days or more past due

$

-

$

935

$

3,764

$

-

$

-

Restructured accruing loans

$

11,253

$

11,378

$

11,501

$

13,418

$

13,287

As of

Asset Quality December September June 30, March 31, DecemberInformation 31, 30, 2020 2020 31, 2020 2020 2019

($ in thousands)

Nonperforming assets:

Nonaccrual $ 184,132 $ 164,247 $ 164,930 $ 125,418 $ 143,181 loans

Other real - - 1,071 1,071 - estate owned

Totalnonperforming $ 184,132 $ 164,247 $ 166,001 $ 126,489 $ 143,181 assets



Nonperformingassets to 0.13 % 0.12 % 0.13 % 0.10 % 0.12 %total assets



Accruingloans 90 days $ - $ 935 $ 3,764 $ - $ - or more pastdue



Restructuredaccruing $ 11,253 $ 11,378 $ 11,501 $ 13,418 $ 13,287 loans

December 31, 2020

COVID-19 Loan Modifications (1), (2), (3), (4), (5)

Unpaid Principal Balance

Deferred Interest (6)

LTV (7)

Average Loan Size

Number of Loans

($ in millions)

Single family

$

407

$

5

63

%

$

1.2

354

Home equity lines of credit

11

-

55

%

$

0.4

25

Single family construction

2

-

75

%

$

2.0

1

Multifamily

291

1

53

%

$

5.6

52

Commercial real estate

297

1

50

%

$

5.5

54

Multifamily/commercial construction

35

-

35

%

$

8.9

4

Capital call lines of credit

-

-

n/a

$

-

-

Tax-exempt

150

-

n/a

$

30.0

5

Other business

59

-

n/a

$

1.5

39

Stock secured

-

-

n/a

$

-

-

Other secured

3

-

n/a

$

0.3

11

Unsecured (8)

15

-

n/a

$

0.1

153

Total

$

1,270

$

7

698

__________

(1) COVID-19 loan modifications are not classified as troubled debt restructurings.

(2) Includes 164 loans totaling $222 million that have completed their deferral period, but for which a regular payment is not yet due.

(3) Includes 269 loans totaling $504 million that received additional relief beyond their initial modification period.

(4) Excludes loans that have completed their deferral period and returned to a regular payment schedule or are no longer outstanding. As of December 31, 2020, $3.1 billion of loans have completed their deferral period or are no longer outstanding, and 99% of the outstanding loans were current.

(5) Loan modifications requested by borrowers that were in process but not yet completed as of December 31, 2020 totaled $53 million for initial relief, and $39 million for additional relief beyond the initial modification period.

(6) Represents interest payments not made during the deferral period through December 31, 2020.

(7) Weighted average loan-to-value ("LTV") ratios for real estate secured loans are based on appraised value at the time of origination.

(8) Consists of household debt refinance loans.

December 31, 2020

COVID-19 Loan Modifications ^ Unpaid Deferred LTV Average Number(1), (2), (3), (4), (5) Principal Interest ^(7) Loan of Balance ^(6) Size Loans

($ in millions)

Single family $ 407 $ 5 63 % $ 1.2 354

Home equity lines of credit 11 - 55 % $ 0.4 25

Single family construction 2 - 75 % $ 2.0 1

Multifamily 291 1 53 % $ 5.6 52

Commercial real estate 297 1 50 % $ 5.5 54

Multifamily/commercial 35 - 35 % $ 8.9 4 construction

Capital call lines of credit - - n/a $ - -

Tax-exempt 150 - n/a $ 30.0 5

Other business 59 - n/a $ 1.5 39

Stock secured - - n/a $ - -

Other secured 3 - n/a $ 0.3 11

Unsecured ^(8) 15 - n/a $ 0.1 153

Total $ 1,270 $ 7 698

__________

^(1) COVID-19 loan modifications are not classified as troubled debtrestructurings.

^(2) Includes 164 loans totaling $222 million that have completed theirdeferral period, but for which a regular payment is not yet due.

^(3) Includes 269 loans totaling $504 million that received additional reliefbeyond their initial modification period.

^(4) Excludes loans that have completed their deferral period and returned to aregular payment schedule or are no longer outstanding. As of December 31, 2020,$3.1 billion of loans have completed their deferral period or are no longeroutstanding, and 99% of the outstanding loans were current.

^(5) Loan modifications requested by borrowers that were in process but not yetcompleted as of December 31, 2020 totaled $53 million for initial relief, and$39 million for additional relief beyond the initial modification period.

^(6) Represents interest payments not made during the deferral period throughDecember 31, 2020.

^(7) Weighted average loan-to-value ("LTV") ratios for real estate securedloans are based on appraised value at the time of origination.

^(8) Consists of household debt refinance loans.

December 31, 2020

Loan Industry Information

Unpaid Principal Balance

LTV

Average Loan Size

Number of Loans

Personal Guarantee %

($ in millions)

Retail

$

1,831

49

%

$

2.7

703

77

%

Hotel

416

48

%

$

6.6

65

72

%

Restaurant (1)

219

49

%

$

1.1

210

93

%

Total (2)

$

2,466

978

__________

(1) Approximately 70% of loans to restaurants are real estate secured.

(2) Amounts in the table above exclude $43 million of loans to hotels and $132 million of loans to restaurants under the PPP.

December 31, 2020

Unpaid Average Number PersonalLoan Industry Information Principal LTV Loan of Guarantee Balance Size Loans %

($ in millions)

Retail $ 1,831 49 % $ 2.7 703 77 %

Hotel 416 48 % $ 6.6 65 72 %

Restaurant ^(1) 219 49 % $ 1.1 210 93 %

Total ^(2) $ 2,466 978

__________

^(1) Approximately 70% of loans to restaurants are real estate secured.

^(2) Amounts in the table above exclude $43 million of loans to hotels and $132million of loans to restaurants under the PPP.

As of

Loan Servicing Portfolio

December 31,2020

September 30,2020

June 30,2020

March 31,2020

December 31,2019

($ in millions)

Loans serviced for investors

$

7,094

$

7,799

$

8,316

$

9,203

$

9,298

As of

Loan Servicing December September June 30, March 31, DecemberPortfolio 31, 30, 2020 2020 31, 2020 2020 2019

($ in millions)

Loans serviced for $ 7,094 $ 7,799 $ 8,316 $ 9,203 $ 9,298 investors

Common Shares, Book Value per Common Shareand Tangible Book Value per Common Share

As of

December 31,2020

September 30,2020

June 30,2020

March 31,2020

December 31,2019

(in thousands, except per share amounts)

Number of shares of common stock outstanding

174,124

172,188

172,094

171,395

168,621

Book value per common share

$

58.61

$

56.33

$

54.80

$

53.76

$

51.63

Tangible book value per common share

$

57.30

$

55.00

$

53.46

$

52.40

$

50.24

Common Shares, Book As ofValue per CommonShareand Tangible Book December September DecemberValue per Common 31, 30, June 30, March 31, 31,Share 2020 2020 2020 2020 2019

(in thousands,except per share amounts)

Number of shares ofcommon stock 174,124 172,188 172,094 171,395 168,621 outstanding

Book value per $ 58.61 $ 56.33 $ 54.80 $ 53.76 $ 51.63 common share

Tangible book value $ 57.30 $ 55.00 $ 53.46 $ 52.40 $ 50.24 per common share

As of

Capital Ratios

December 31, 2020 (1), (2)

September 30, 2020 (2)

June 30, 2020 (2)

March 31, 2020 (2)

December 31,2019

Tier 1 leverage ratio (Tier 1 capital to average assets)

8.14

%

8.38

%

8.15

%

8.46

%

8.39

%

Common Equity Tier 1 capital to risk-weighted assets

9.67

%

9.78

%

9.80

%

9.87

%

9.86

%

Tier 1 capital to risk-weighted assets

11.18

%

11.50

%

11.04

%

11.14

%

11.21

%

Total capital to risk-weighted assets

12.55

%

12.94

%

12.49

%

12.62

%

12.73

%

Regulatory Capital (3)

($ in thousands)

Common Equity Tier 1 capital

$

9,894,870

$

9,375,688

$

9,103,771

$

8,887,905

$

8,371,192

Tier 1 capital

$

11,439,870

$

11,020,688

$

10,248,771

$

10,032,905

$

9,516,192

Total capital

$

12,842,344

$

12,396,304

$

11,604,141

$

11,365,654

$

10,802,209

Assets (3)

($ in thousands)

Average assets

$

140,493,283

$

131,517,445

$

125,690,830

$

118,626,842

$

113,403,507

Risk-weighted assets

$

102,321,489

$

95,823,385

$

92,870,859

$

90,072,400

$

84,885,943

__________

(1) Ratios and amounts as of December 31, 2020 are preliminary.

(2) In accordance with the CECL Capital Rule, the Bank elected to delay the estimated impact of CECL on its regulatory capital and risk-weighted assets over a five-year transition period ending December 31, 2024. Ratios and amounts for 2020 periods have been adjusted to exclude the following impacts attributed to the adoption of CECL: decreases in retained earnings, increases in allowance for credit losses on loans, held-to-maturity debt securities and unfunded loan commitments, decreases in average assets, and increases in risk-weighted assets.

(3) As defined by regulatory capital rules.

As of

Capital December 31, September 30, June 30, March 31, December 31,Ratios 2020 ^(1), (2) 2020 ^(2) 2020 ^(2) 2020 ^(2) 2019

Tier 1leverageratio (Tier 1 8.14 % 8.38 % 8.15 % 8.46 % 8.39 %capital toaverageassets)

Common EquityTier 1capital to 9.67 % 9.78 % 9.80 % 9.87 % 9.86 %risk-weightedassets

Tier 1capital to 11.18 % 11.50 % 11.04 % 11.14 % 11.21 %risk-weightedassets

Total capitalto 12.55 % 12.94 % 12.49 % 12.62 % 12.73 %risk-weightedassets

Regulatory Capital ^(3)

($ in thousands)

Common EquityTier 1 $ 9,894,870 $ 9,375,688 $ 9,103,771 $ 8,887,905 $ 8,371,192 capital

Tier 1 $ 11,439,870 $ 11,020,688 $ 10,248,771 $ 10,032,905 $ 9,516,192 capital

Total capital $ 12,842,344 $ 12,396,304 $ 11,604,141 $ 11,365,654 $ 10,802,209

Assets ^(3)

($ in thousands)

Average $ 140,493,283 $ 131,517,445 $ 125,690,830 $ 118,626,842 $ 113,403,507 assets

Risk-weighted $ 102,321,489 $ 95,823,385 $ 92,870,859 $ 90,072,400 $ 84,885,943 assets

__________

^(1) Ratios and amounts as of December 31, 2020 are preliminary.

^(2) In accordance with the CECL Capital Rule, the Bank elected to delay theestimated impact of CECL on its regulatory capital and risk-weighted assetsover a five-year transition period ending December 31, 2024. Ratios and amountsfor 2020 periods have been adjusted to exclude the following impacts attributedto the adoption of CECL: decreases in retained earnings, increases in allowancefor credit losses on loans, held-to-maturity debt securities and unfunded loancommitments, decreases in average assets, and increases in risk-weightedassets.

^(3) As defined by regulatory capital rules.

As of

Wealth Management Assets

December 31,2020

September 30,2020

June 30,2020

March 31,2020

December 31,2019

($ in millions)

First Republic Investment Management

$

83,596

$

74,661

$

68,124

$

60,056

$

66,029

Brokerage and investment:

Brokerage

88,059

76,769

70,178

60,189

68,807

Money market mutual funds

9,003

4,416

5,933

6,893

4,268

Total brokerage and investment

97,062

81,185

76,111

67,082

73,075

Trust Company:

Trust

9,910

8,687

7,905

7,288

7,121

Custody

3,889

3,651

3,646

3,461

4,818

Total Trust Company

13,799

12,338

11,551

10,749

11,939

Total Wealth Management Assets

$

194,457

$

168,184

$

155,786

$

137,887

$

151,043

View source version on businesswire.com: https://www.businesswire.com/news/home/20210114005282/en/

CONTACT: Investors: Andrew Greenebaum / Lasse Glassen Addo Investor Relations agreenebaum@addoir.com lglassen@addoir.com (310) 829-5400

CONTACT: Media: Greg Berardi Blue Marlin Partners greg@bluemarlinpartners.com (415) 239-7826