PR Newswire | Apr 22, 2021 04:16PM EDT

04/22 15:15 CDT

First Financial Bancorp Announces First Quarter 2021 Financial Results CINCINNATI, April 22, 2021

CINCINNATI, April 22, 2021 /PRNewswire/ --

* Earnings per diluted share of $0.48; $0.50 on an adjusted(1) basis * Return on average assets of 1.20%; 1.24% as adjusted(1) * Net interest margin FTE(1) of 3.40% * Provision for credit losses of $4.0 million; $7.5 million decline from linked quarter * Repurchased 840,115 shares during the quarter

First Financial Bancorp. (Nasdaq: FFBC) ("First Financial" or the "Company") announced financial results for the three months ended March 31, 2021.

For the three months ended March 31, 2021, the Company reported net income of $47.3 million, or $0.48 per diluted common share. These results compare to net income of $48.3 million, or $0.49 per diluted common share, for the fourth quarter of 2020 and $28.6 million, or $0.29 per diluted common share, for the first quarter of 2020.

Return on average assets for the first quarter of 2021 was 1.20% while return on average tangible common equity was 15.24%. These compare to returns on average assets of 1.20% and 0.79%, and returns on average tangible common equity of 15.50% and 9.71%, in the fourth quarter of 2020 and the first quarter of 2020, respectively.

First quarter 2021 highlights include:

* After adjustments(1) for certain nonrecurring items: * Net income of $0.50 per diluted common share * 1.24% return on average assets * 15.80% return on average tangible common equity

* Net interest margin of 3.40% on a fully tax-equivalent basis(1) in line with expectations * 9 basis point reduction from linked quarter driven by fewer fees related to loan prepayments, and lower volume of PPP forgiveness

* Noninterest income of $40.3 million, or $40.2 million as adjusted(1) * Foreign exchange income of $10.8 million remains strong despite decline from record fourth quarter * Mortgage income of $9.5 million in line with expectations given expected seasonal declines and lower premiums

* Noninterest expenses of $92.5 million, or $90.0 million as adjusted(1) * Adjustments(1) include: * $1.3 million of severance related costs * $1.3 million of other nonrecurring costs such as branch consolidation costs

* Efficiency ratio of 60.0%; 58.4% as adjusted(1)

* Excluding PPP growth, loan balances declined slightly during the quarter driven primarily by a decline in consumer and mortgage loans * Average transactional deposit balances grew $523.7 million compared to the linked quarter; 21.1% on an annualized basis

^(1) Financial information in this release that is described as "adjusted" orthat is presented on a fully tax equivalent basis is non-GAAP. For details onthe calculation of these non-GAAP financial measures and a reconciliation tothe GAAP financial measure, see the sections titled "Use of Non-GAAP FinancialMeasures" in this release and "Appendix: Non-GAAP to GAAP Reconciliation" inthe accompanying slide presentation.

* Total Allowance for Credit Losses of $183.0 million; Total quarterly provision for credit losses of $4.0 million * Loans and leases - ACL of $169.9 million, 1.71% of total loans; 1.84% of loans excluding PPP * Unfunded Commitments - ACL of $13.0 million * First quarter provision expense driven by net charge-offs, partially offset by improvements in economic conditions

* Strong capital ratios * Total capital of 15.41% * Tier 1 common equity of 11.81% * Tangible common equity of 8.22%; 8.62% excluding PPP loans * Tangible book value per share of $12.78; $0.15 decrease compared to linked quarter * Repurchased 840,115 shares during first quarter

Archie Brown, President and Chief Executive Officer, remarked, "While uncertainty remains due to the ongoing pandemic, the accelerated COVID-19 vaccine distribution, unprecedented fiscal stimulus, and an accommodative Federal Reserve have led to widespread optimism for our economy, which is in stark contrast to our sentiment at this time last year. Our first quarter operating performance reflects this change in sentiment and we have renewed optimism as a result of the improved business climate, despite an operating environment that presents challenges due to very low interest rates and muted loan demand."

Mr. Brown continued, "Our first quarter financial results once again reflect our earnings power and our consistent ability to deliver value to our shareholders. Our core quarterly financial metrics remained strong with adjusted(1) earnings per share of $0.50, adjusted(1) return on assets of 1.24%, and an adjusted(1) efficiency ratio of 58.4%. Net income was bolstered by lower expenses and significantly lower credit costs. Despite expected seasonal declines, noninterest income was strong due to healthy mortgage demand, robust foreign exchange activity and higher wealth management fees. In addition, adjusted(1) noninterest expenses declined $4.6 million from the linked quarter and resulted in a sub-60% efficiency ratio. As I mentioned, credit costs were low with $4.0 million of provision expense during the quarter, and resulted in an allowance for credit losses of 1.84% of total loans, excluding PPP. Classified assets increased during the quarter, however our overall credit outlook has improved significantly and our borrowers are seeing benefits from the various stimulus actions. While first quarter net charge-offs increased slightly from previous quarters, this was driven by a single customer relationship. Given our overall credit outlook, we expect the allowance for credit losses to continue to decline over the course of 2021."

Mr. Brown commented on balance sheet trends and capital utilization, "Excluding PPP activity, loan balances declined slightly for the quarter due to accelerated mortgage and HELOC payoffs, increased borrower liquidity, and muted business loan demand. As a result of these trends, we anticipate slower growth in the near-term, with some acceleration in the second half of the year. As of March 31, consumers and businesses were holding record levels of deposits, with average balances increasing during the quarter as a result of the stimulus package approved by Congress last December. We anticipate further deposit balance growth in the second quarter after the passage of the most recent stimulus bill. This anticipated growth will likely suppress loan demand and service charge income in the near-term. From a capital standpoint, our ratios remained strong through the first quarter. The combination of our current capital levels and our improved credit outlook, prompted us to repurchase 840,115 shares during the quarter. Absent higher priority capital deployment alternatives, we anticipate additional buyback activity in the second quarter."

Mr. Brown concluded, "We are pleased with our improved performance and outlook from this time last year. We have started to transition associates back into their physical office locations, and we look forward to implementing the lessons learned over the past year to create an efficient, safe, and collaborative workplace. As our local and national economies continue to improve, we believe we are well positioned to deliver industry leading services to our clients and returns to our shareholders."

Full detail of the Company's first quarter 2021 performance is provided in the accompanying financial statements and slide presentation.

Teleconference / Webcast InformationFirst Financial's executive management will host a conference call to discuss the Company's financial and operating results on Friday, April 23, 2021 at 8:30 a.m. Eastern Time. Members of the public who would like to listen to the conference call should dial (877) 506-6873 (U.S. toll free), (855) 669-9657 (Canada toll free) or +1 (412) 380-2003 (International) (no passcode required). The number should be dialed five to ten minutes prior to the start of the conference call. The conference call will also be accessible as an audio webcast via the Investor Relations section of the Company's website at www.bankatfirst.com. A replay of the conference call will be available beginning one hour after the completion of the live call at (877) 344-7529 (U.S. toll free), (855) 669-9658 (Canada toll free) and +1 (412) 317-0088 (International); conference number 10154329. The webcast will be archived on the Investor Relations section of the Company's website for 12 months.

Press Release and Additional Information on WebsiteThis press release as well as supplemental information are available to the public through the Investor Relations section of First Financial's website at www.bankatfirst.com.

Use of Non-GAAP Financial MeasuresThis earnings release contains GAAP financial measures and Non-GAAP financial measures where management believes it to be helpful in understanding the Company's results of operations or financial position. Where Non-GAAP financial measures are used, the comparable GAAP financial measures, as well as a reconciliation to the comparable GAAP financial measure, can be found in the section titled "Appendix: Non-GAAP to GAAP Reconciliation" in the accompanying slide presentation.

Forward-Looking Statement

Certain statements contained in this report which are not statements of historical fact constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as ''believes,'' ''anticipates,'' "likely," "expected," "estimated," ''intends'' and other similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. Examples of forward-looking statements include, but are not limited to, statements we make about (i) our future operating or financial performance, including revenues, income or loss and earnings or loss per share, (ii) future common stock dividends, (iii) our capital structure, including future capital levels, (iv) our plans, objectives and strategies, and (v) the assumptions that underlie our forward-looking statements.

As with any forecast or projection, forward-looking statements are subject to inherent uncertainties, risks and changes in circumstances that may cause actual results to differ materially from those set forth in the forward-looking statements. Forward-looking statements are not historical facts but instead express only management's beliefs regarding future results or events, many of which, by their nature, are inherently uncertain and outside of management's control. It is possible that actual results and outcomes may differ, possibly materially, from the anticipated results or outcomes indicated in these forward-looking statements. Important factors that could cause actual results to differ materially from those in our forward-looking statements include the following, without limitation:

* economic, market, liquidity, credit, interest rate, operational and technological risks associated with the Company's business; * future credit quality and performance, including our expectations regarding future loan losses and our allowance for credit losses * the effect of and changes in policies and laws or regulatory agencies, including the Dodd-Frank Wall Street Reform and Consumer Protection Act and other legislation and regulation relating to the banking industry; * Management's ability to effectively execute its business plans; * mergers and acquisitions, including costs or difficulties related to the integration of acquired companies; * the possibility that any of the anticipated benefits of the Company's acquisitions will not be realized or will not be realized within the expected time period; * the effect of changes in accounting policies and practices; * changes in consumer spending, borrowing and saving and changes in unemployment; * changes in customers' performance and creditworthiness; * the costs and effects of litigation and of unexpected or adverse outcomes in such litigation; * current and future economic and market conditions, including the effects of declines in housing prices, high unemployment rates, U.S. fiscal debt, budget and tax matters, geopolitical matters, and any slowdown in global economic growth; * the adverse impact on the U.S. economy, including the markets in which we operate, of the novel coronavirus, which causes the Coronavirus disease 2019 ("COVID-19"), global pandemic, and the impact of a slowing U.S. economy and increased unemployment on the performance of our loan and lease portfolio, the market value of our investment securities, the availability of sources of funding and the demand for our products; * our capital and liquidity requirements (including under regulatory capital standards, such as the Basel III capital standards) and our ability to generate capital internally or raise capital on favorable terms; * financial services reform and other current, pending or future legislation or regulation that could have a negative effect on our revenue and businesses, including the Dodd-Frank Act and other legislation and regulation relating to bank products and services; * the effect of the current interest rate environment or changes in interest rates or in the level or composition of our assets or liabilities on our net interest income, net interest margin and our mortgage originations, mortgage servicing rights and mortgage loans held for sale; * the effect of a fall in stock market prices on our brokerage, asset and wealth management businesses; * a failure in or breach of our operational or security systems or infrastructure, or those of our third-party vendors or other service providers, including as a result of cyber attacks; * the effect of changes in the level of checking or savings account deposits on our funding costs and net interest margin; and * our ability to develop and execute effective business plans and strategies.

Additional factors that may cause our actual results to differ materially from those described in our forward-looking statements can be found in our Form 10-K for the year ended December 31, 2020, as well as our other filings with the SEC, which are available on the SEC website at www.sec.gov.

All forward-looking statements included in this filing are made as of the date hereof and are based on information available at the time of the filing. Except as required by law, the Company does not assume any obligation to update any forward-looking statement.

About First Financial Bancorp.First Financial Bancorp. is a Cincinnati, Ohio based bank holding company. As of March 31, 2021, the Company had $16.2 billion in assets, $9.9 billion in loans, $12.6 billion in deposits and $2.3 billion in shareholders' equity. The Company's subsidiary, First Financial Bank, founded in 1863, provides banking and financial services products through its six lines of business: Commercial, Retail Banking, Investment Commercial Real Estate, Mortgage Banking, Commercial Finance and Wealth Management. These business units provide traditional banking services to business and retail clients. Wealth Management provides wealth planning, portfolio management, trust and estate, brokerage and retirement plan services and had approximately $3.1 billion in assets under management as of March 31, 2021. The Company operated 143 full service banking centers as of March 31, 2021, primarily in Ohio, Indiana, Kentucky and Illinois, while the Commercial Finance business lends into targeted industry verticals on a nationwide basis. Additional information about the Company, including its products, services and banking locations, is available at www.bankatfirst.com.

FIRST FINANCIAL BANCORP.

CONSOLIDATED FINANCIAL HIGHLIGHTS

(Dollars in thousands, except per share data)

(Unaudited)



Three Months Ended,

Mar. 31, Dec. 31, Sep. 30, June 30, Mar. 31,

2021 2020 2020 2020 2020

RESULTS OF OPERATIONS

Net income $47,315 $48,312 $41,477 $37,393 $28,628

Net earnings per share - basic $0.49 $0.50 $0.43 $0.38 $0.29

Net earnings per share - diluted $0.48 $0.49 $0.42 $0.38 $0.29

Dividends declared per share $0.23 $0.23 $0.23 $0.23 $0.23



KEY FINANCIAL RATIOS

Return on average assets 1.20 %1.20 %1.04 %0.96 %0.79 %

Return on average shareholders' equity 8.44 %8.52 %7.40 %6.88 %5.21 %

Return on average tangible shareholders' equity 15.24 %15.50 %13.61 %12.90 %9.71 %



Net interest margin 3.35 %3.45 %3.32 %3.38 %3.71 %

Net interest margin (fully tax equivalent) ^(1) 3.40 %3.49 %3.36 %3.44 %3.77 %



Ending shareholders' equity as a percent of ending assets 13.97 %14.29 %14.11 %13.99 %14.47 %

Ending tangible shareholders' equity as a percent of:

Ending tangible assets 8.22 %8.47 %8.25 %8.09 %8.25 %

Risk-weighted assets 11.02 %11.29 %11.07 %10.89 %10.50 %



Average shareholders' equity as a percent of average assets14.17 %14.07 %14.08 %13.91 %15.21 %

Average tangible shareholders' equity as a percent of

average tangible assets 8.38 %8.26 %8.18 %7.94 %8.79 %



Book value per share $23.16 $23.28 $22.94 $22.66 $22.25

Tangible book value per share $12.78 $12.93 $12.56 $12.26 $11.82



Common equity tier 1 ratio^ (2) 11.81 %11.82 %11.63 %11.49 %11.27 %

Tier 1 ratio ^(2) 12.19 %12.20 %12.02 %11.87 %11.66 %

Total capital ratio ^(2) 15.41 %15.55 %15.37 %15.19 %13.54 %

Leverage ratio ^(2) 9.34 %9.55 %9.55 %8.98 %9.49 %



AVERAGE BALANCE SHEET ITEMS

Loans ^(3) $9,951,855 $10,127,881 $10,253,392 $10,002,379 $9,220,643

Investment securities 3,782,993 3,403,839 3,162,832 3,164,243 3,115,723

Interest-bearing deposits with other banks 46,912 143,884 40,277 91,990 39,332

Total earning assets $13,781,760 $13,675,604 $13,456,501 $13,258,612 $12,375,698

Total assets $16,042,654 $16,030,986 $15,842,010 $15,710,204 $14,524,422

Noninterest-bearing deposits $3,840,046 $3,720,417 $3,535,432 $3,335,866 $2,643,240

Interest-bearing deposits 8,531,822 8,204,306 8,027,082 8,395,229 7,590,791

Total deposits $12,371,868 $11,924,723 $11,562,514 $11,731,095 $10,234,031

Borrowings $886,379 $1,307,461 $1,519,748 $1,272,819 $1,735,767

Shareholders' equity $2,272,749 $2,256,062 $2,230,422 $2,185,865 $2,209,733



CREDIT QUALITY RATIOS

Allowance to ending loans 1.71 %1.77 %1.65 %1.56 %1.55 %

Allowance to nonaccrual loans 199.33 %217.55 %216.28 %233.74 %296.51 %

Allowance to nonperforming loans 175.44 %199.97 %196.69 %208.06 %203.42 %

Nonperforming loans to total loans 0.97 %0.89 %0.84 %0.75 %0.76 %

Nonperforming assets to ending loans, plus OREO 0.98 %0.90 %0.86 %0.77 %0.78 %

Nonperforming assets to total assets 0.60 %0.56 %0.55 %0.49 %0.48 %

Classified assets to total assets 1.22 %0.89 %0.84 %0.79 %0.83 %

Net charge-offs to average loans (annualized) 0.38 %0.26 %0.21 %0.12 %(0.04) %

^(1) The tax equivalent adjustment to net interest income recognizes the incometax savings when comparing taxable and tax-exempt assets and assumes a 21% taxrate. Management believes that it is a standard practice in the bankingindustry to present net interest margin and net interest income on a fully taxequivalent basis. Therefore, management believes these measures provide usefulinformation to investors by allowing them to make peer comparisons. Managementalso uses these measures to make peer comparisons.

^(2) March 31, 2021 regulatory capital ratios are preliminary.

^(3) Includes loans held for sale.

FIRST FINANCIAL BANCORP.

CONSOLIDATED QUARTERLY STATEMENTS OF INCOME

(Dollars in thousands, except per share data)

(Unaudited)



2021 2020

First Fourth Third Second First Full

Quarter Quarter Quarter Quarter Quarter Year

Interest income

Loans and leases, including fees $98,931 $106,733 $103,249 $105,900 $115,775 $431,657

Investment securities

Taxable 18,607 18,402 17,906 18,476 19,005 73,789

Tax-exempt 5,043 4,839 4,884 4,937 4,582 19,242

Total investment securities interest 23,650 23,241 22,790 23,413 23,587 93,031

Other earning assets 28 55 31 47 142 275

Total interest income 122,609 130,029 126,070 129,360 139,504 524,963



Interest expense

Deposits 4,333 5,920 7,886 11,751 16,365 41,922

Short-term borrowings 67 30 51 1,274 5,087 6,442

Long-term borrowings 4,333 5,606 5,953 4,759 3,770 20,088

Total interest expense 8,733 11,556 13,890 17,784 25,222 68,452

Net interest income 113,876 118,473 112,180 111,576 114,282 456,511

Provision for credit losses-loans and leases 3,450 13,758 15,299 17,859 23,880 70,796

Provision for credit losses-unfunded commitments 538 (2,250) (1,925) 2,370 1,568 (237)

Net interest income after provision for credit losses109,888 106,965 98,806 91,347 88,834 385,952



Noninterest income

Service charges on deposit accounts 7,146 7,654 7,356 6,001 8,435 29,446

Trust and wealth management fees 4,398 4,093 3,855 4,114 4,469 16,531

Bankcard income 3,128 3,060 3,124 2,844 2,698 11,726

Client derivative fees 1,556 2,021 2,203 2,984 3,105 10,313

Foreign exchange income 10,757 12,305 10,530 6,576 9,966 39,377

Net gains from sales of loans 9,454 13,089 18,594 16,662 2,831 51,176

Net gains (losses) on sale of investment securities (166) 4,618 2 2 (59) 4,563

Unrealized gain (loss) on equity securities 112 8,975 18 150 (98) 9,045

Other 3,937 5,700 3,817 3,392 4,037 16,946

Total noninterest income 40,322 61,515 49,499 42,725 35,384 189,123



Noninterest expenses

Salaries and employee benefits 61,253 62,263 63,769 55,925 54,822 236,779

Net occupancy 5,704 6,159 5,625 5,378 6,104 23,266

Furniture and equipment 3,969 3,596 3,638 3,681 4,053 14,968

Data processing 7,287 7,269 6,837 7,019 6,389 27,514

Marketing 1,361 1,999 1,856 1,339 1,220 6,414

Communication 838 840 855 907 890 3,492

Professional services 1,450 3,038 2,443 2,205 2,275 9,961

Debt extinguishment 0 7,257 0 0 0 7,257

State intangible tax 1,202 1,514 1,514 1,514 1,516 6,058

FDIC assessments 1,349 1,065 1,350 1,290 1,405 5,110

Intangible amortization 2,479 2,764 2,779 2,791 2,792 11,126

Other 5,614 17,034 6,845 6,640 8,200 38,719

Total noninterest expenses 92,506 114,798 97,511 88,689 89,666 390,664

Income before income taxes 57,704 53,682 50,794 45,383 34,552 184,411

Income tax expense (benefit) 10,389 5,370 9,317 7,990 5,924 28,601

Net income $47,315 $48,312 $41,477 $37,393 $28,628 $155,810



ADDITIONAL DATA

Net earnings per share - basic $0.49 $0.50 $0.43 $0.38 $0.29 $1.60

Net earnings per share - diluted $0.48 $0.49 $0.42 $0.38 $0.29 $1.59

Dividends declared per share $0.23 $0.23 $0.23 $0.23 $0.23 $0.92



Return on average assets 1.20 %1.20 %1.04 %0.96 %0.79 %1.00 %

Return on average shareholders' equity 8.44 %8.52 %7.40 %6.88 %5.21 %7.02 %



Interest income $122,609 $130,029 $126,070 $129,360 $139,504 $524,963

Tax equivalent adjustment 1,652 1,613 1,628 1,664 1,624 6,529

Interest income - tax equivalent 124,261 131,642 127,698 131,024 141,128 531,492

Interest expense 8,733 11,556 13,890 17,784 25,222 68,452

Net interest income - tax equivalent $115,528 $120,086 $113,808 $113,240 $115,906 $463,040



Net interest margin 3.35 %3.45 %3.32 %3.38 %3.71 %3.46 %

Net interest margin (fully tax equivalent)^ (1) 3.40 %3.49 %3.36 %3.44 %3.77 %3.51 %



Full-time equivalent employees 2,063 2,075 2,065 2,076 2,067



^(1) The tax equivalent adjustment to net interest income recognizes the income tax savings when comparing taxable and tax-exempt assets andassumes a 21% tax rate. Management believes that it is a standard practice in the banking industry to present net interest income on a fully tax equivalent basis. Therefore, management believes these measures provide useful information to investors by allowing them to make peer comparisons. Management also uses these measures to make peer comparisons.

FIRST FINANCIAL BANCORP.

CONSOLIDATED STATEMENTS OF CONDITION

(Dollars in thousands)

(Unaudited)



Mar. 31, Dec. 31, Sep. 30, June 30, Mar. 31, % Change % Change

2021 2020 2020 2020 2020 Linked Qtr.Comp Qtr.

ASSETS

Cash and due from banks $210,191 $231,054 $207,128 $283,639 $261,892 (9.0) % (19.7) %

Interest-bearing deposits with other banks 19,180 20,305 38,806 38,845 71,071 (5.5) % (73.0) %

Investment securities available-for-sale 3,753,763 3,424,580 3,004,963 2,897,413 2,908,688 9.6 % 29.1 %

Investment securities held-to-maturity 121,945 131,687 118,072 127,347 136,744 (7.4) % (10.8) %

Other investments 131,814 133,198 118,292 132,366 143,581 (1.0) % (8.2) %

Loans held for sale 34,590 41,103 69,008 43,950 27,334 (15.8) % 26.5 %

Loans and leases

Commercial and industrial 3,044,825 3,007,509 3,292,313 3,322,374 2,477,773 1.2 % 22.9 %

Lease financing 66,574 72,987 74,742 80,087 82,602 (8.8) % (19.4) %

Construction real estate 642,709 636,096 575,648 506,085 500,311 1.0 % 28.5 %

Commercial real estate 4,396,582 4,307,858 4,347,125 4,343,702 4,278,257 2.1 % 2.8 %

Residential real estate 946,522 1,003,086 1,027,702 1,043,745 1,061,792 (5.6) % (10.9) %

Home equity 709,667 743,099 754,743 764,171 781,243 (4.5) % (9.2) %

Installment 82,421 81,850 84,629 79,150 80,085 0.7 % 2.9 %

Credit card 44,669 48,485 43,907 42,397 45,756 (7.9) % (2.4) %

Total loans 9,933,969 9,900,970 10,200,809 10,181,711 9,307,819 0.3 % 6.7 %

Less:

Allowance for credit losses 169,923 175,679 168,544 158,661 143,885 (3.3) % 18.1 %

Net loans 9,764,046 9,725,291 10,032,265 10,023,050 9,163,934 0.4 % 6.5 %

Premises and equipment 204,537 207,211 209,474 211,164 212,787 (1.3) % (3.9) %

Goodwill 937,771 937,771 937,771 937,771 937,771 0.0 % 0.0 %

Other intangibles 61,984 64,552 67,419 70,325 73,258 (4.0) % (15.4) %

Accrued interest and other assets 935,250 1,056,382 1,122,449 1,105,020 1,120,507 (11.5) % (16.5) %

Total Assets $16,175,071$15,973,134$15,925,647$15,870,890$15,057,5671.3 % 7.4 %



LIABILITIES

Deposits

Interest-bearing demand $2,914,761 $2,914,787 $2,632,467 $2,657,841 $2,498,109 0.0 % 16.7 %

Savings 4,006,181 3,680,774 3,446,678 3,287,314 2,978,250 8.8 % 34.5 %

Time 1,731,757 1,872,733 1,935,392 2,241,212 2,435,858 (7.5) % (28.9) %

Total interest-bearing deposits 8,652,699 8,468,294 8,014,537 8,186,367 7,912,217 2.2 % 9.4 %

Noninterest-bearing 3,995,370 3,763,709 3,552,893 3,515,048 2,723,341 6.2 % 46.7 %

Total deposits 12,648,069 12,232,003 11,567,430 11,701,415 10,635,558 3.4 % 18.9 %

Federal funds purchased and securities sold

under agreements to repurchase 181,387 166,594 247,658 154,347 215,824 8.9 % (16.0) %

FHLB short-term borrowings 0 0 0 0 1,181,900 0.0 % (100.0)%

Total short-term borrowings 181,387 166,594 247,658 154,347 1,397,724 8.9 % (87.0) %

Long-term debt 583,722 776,202 1,341,164 1,285,767 325,566 (24.8) % 79.3 %

Total borrowed funds 765,109 942,796 1,588,822 1,440,114 1,723,290 (18.8) % (55.6) %

Accrued interest and other liabilities 502,951 516,265 521,580 508,342 519,336 (2.6) % (3.2) %

Total Liabilities 13,916,129 13,691,064 13,677,832 13,649,871 12,878,184 1.6 % 8.1 %



SHAREHOLDERS' EQUITY

Common stock 1,633,137 1,638,947 1,637,489 1,635,070 1,633,950 (0.4) % 0.0 %

Retained earnings 745,220 720,429 694,484 675,532 660,653 3.4 % 12.8 %

Accumulated other comprehensive income (loss)18,101 48,664 42,266 36,431 11,788 (62.8) % 53.6 %

Treasury stock, at cost (137,516) (125,970) (126,424) (126,014) (127,008) 9.2 % 8.3 %

Total Shareholders' Equity 2,258,942 2,282,070 2,247,815 2,221,019 2,179,383 (1.0) % 3.7 %

Total Liabilities and Shareholders' Equity $16,175,071$15,973,134$15,925,647$15,870,890$15,057,5671.3 % 7.4 %





FIRST FINANCIAL BANCORP.

AVERAGE CONSOLIDATED STATEMENTS OF CONDITION

(Dollars in thousands)

(Unaudited)



Quarterly Averages

Mar. 31, Dec. 31, Sep. 30, June 30, Mar. 31,

2021 2020 2020 2020 2020

ASSETS

Cash and due from banks $232,275 $228,427 $233,216 $284,726 $235,696

Interest-bearing deposits with other banks 46,912 143,884 40,277 91,990 39,332

Investment securities 3,782,993 3,403,839 3,162,832 3,164,243 3,115,723

Loans held for sale 29,689 42,402 45,186 36,592 13,174

Loans and leases

Commercial and industrial 3,029,716 3,182,749 3,299,259 3,058,677 2,450,893

Lease financing 70,508 74,107 78,500 81,218 85,782

Construction real estate 647,655 608,401 536,870 495,407 501,471

Commercial real estate 4,339,349 4,313,408 4,364,708 4,381,647 4,209,345

Residential real estate 980,718 1,022,701 1,041,250 1,052,996 1,055,456

Home equity 726,134 752,425 759,994 772,424 773,082

Installment 81,377 83,509 82,016 79,016 81,234

Credit card 46,709 48,179 45,609 44,402 50,206

Total loans 9,922,166 10,085,479 10,208,206 9,965,787 9,207,469

Less:

Allowance for credit losses 177,863 172,201 165,270 155,454 121,126

Net loans 9,744,303 9,913,278 10,042,936 9,810,333 9,086,343

Premises and equipment 206,628 208,800 211,454 213,903 215,545

Goodwill 937,771 937,771 937,771 937,771 937,771

Other intangibles 63,529 66,195 69,169 72,086 75,014

Accrued interest and other assets 998,554 1,086,390 1,099,169 1,098,560 805,824

Total Assets $16,042,654$16,030,986$15,842,010$15,710,204$14,524,422



LIABILITIES

Deposits

Interest-bearing demand $2,948,682 $2,812,748 $2,668,635 $2,602,917 $2,418,193

Savings 3,815,314 3,547,179 3,342,514 3,173,274 2,976,518

Time 1,767,826 1,844,379 2,015,933 2,619,038 2,196,080

Total interest-bearing deposits 8,531,822 8,204,306 8,027,082 8,395,229 7,590,791

Noninterest-bearing 3,840,046 3,720,417 3,535,432 3,335,866 2,643,240

Total deposits 12,371,868 11,924,723 11,562,514 11,731,095 10,234,031

Federal funds purchased and securities sold

under agreements to repurchase 184,483 136,795 150,088 145,291 164,093

FHLB short-term borrowings 67,222 7,937 30,868 548,183 1,189,765

Total short-term borrowings 251,705 144,732 180,956 693,474 1,353,858

Long-term debt 634,674 1,162,729 1,338,792 579,345 381,909

Total borrowed funds 886,379 1,307,461 1,519,748 1,272,819 1,735,767

Accrued interest and other liabilities 511,658 542,740 529,326 520,425 344,891

Total Liabilities 13,769,905 13,774,924 13,611,588 13,524,339 12,314,689



SHAREHOLDERS' EQUITY

Common stock 1,636,884 1,638,032 1,636,107 1,634,405 1,638,851

Retained earnings 726,351 703,257 679,980 658,312 660,108

Accumulated other comprehensive loss 42,253 40,960 40,697 19,888 31,200

Treasury stock, at cost (132,739) (126,187) (126,362) (126,740) (120,426)

Total Shareholders' Equity 2,272,749 2,256,062 2,230,422 2,185,865 2,209,733

Total Liabilities and Shareholders' Equity$16,042,654$16,030,986$15,842,010$15,710,204$14,524,422





FIRST FINANCIAL BANCORP.

NET INTEREST MARGIN RATE/VOLUME ANALYSIS

(Dollars in thousands)

(Unaudited)



Quarterly Averages

March 31, 2021 December 31, 2020 March 31, 2020 Linked Qtr. Income Variance Comparable Qtr. Income Variance

Balance Yield Balance Yield Balance Yield Rate Volume Total Rate Volume Total

Earning assets

Investments:

Investment securities $3,782,993 2.54%$3,403,839 2.71 % $3,115,723 3.04 % $(1,488)$1,897$409 $(3,892) $3,955$63

Interest-bearing deposits with other banks46,912 0.24%143,884 0.15 % 39,332 1.45 % 33 (60) (27) (118) 4 (114)

Gross loans ^(1) 9,951,855 4.03%10,127,881 4.18 % 9,220,643 5.04 % (3,815) (3,987)(7,802) (23,094) 6,250 (16,844)

Total earning assets 13,781,760 3.61%13,675,604 3.77 % 12,375,698 4.52 % (5,270) (2,150)(7,420) (27,104) 10,209 (16,895)



Nonearning assets

Allowance for credit losses (177,863) (172,201) (121,126)

Cash and due from banks 232,275 228,427 235,696

Accrued interest and other assets 2,206,482 2,299,156 2,034,154

Total assets $16,042,654 $16,030,986 $14,524,422



Interest-bearing liabilities

Deposits:

Interest-bearing demand $2,948,682 0.07%$2,812,748 0.08 % $2,418,193 0.45 %

Savings 3,815,314 0.13%3,547,179 0.15 % 2,976,518 0.45 %

Time 1,767,826 0.60%1,844,379 0.86 % 2,196,080 1.88 %

Total interest-bearing deposits 8,531,822 0.21%8,204,306 0.29 % 7,590,791 0.86 % $(1,661)$74 $(1,587)$(12,467)$435 $(12,032)

Borrowed funds

Short-term borrowings 251,705 0.11%144,732 0.08 % 1,353,858 1.51 % 9 28 37 (4,723) (297) (5,020)

Long-term debt 634,674 2.77%1,162,729 1.91 % 381,909 3.96 % 2,509 (3,782)(1,273) (1,134) 1,697 563

Total borrowed funds 886,379 2.01%1,307,461 1.71 % 1,735,767 2.05 % 2,518 (3,754)(1,236) (5,857) 1,400 (4,457)

Total interest-bearing liabilities 9,418,201 0.38%9,511,767 0.48 % 9,326,558 1.08 % 857 (3,680)(2,823) (18,324) 1,835 (16,489)



Noninterest-bearing liabilities

Noninterest-bearing demand deposits 3,840,046 3,720,417 2,643,240

Other liabilities 511,658 542,740 344,891

Shareholders' equity 2,272,749 2,256,062 2,209,733

Total liabilities & shareholders' equity $16,042,654 $16,030,986 $14,524,422



Net interest income $113,876 $118,473 $114,282 $(6,127)$1,530$(4,597)$(8,780) $8,374$(406)

Net interest spread 3.23% 3.29 % 3.44 %

Net interest margin 3.35% 3.45 % 3.71 %



Tax equivalent adjustment 0.05% 0.04 % 0.06 %

Net interest margin (fully tax equivalent) 3.40% 3.49 % 3.77 %





^(1) Loans held for sale and nonaccrual loans are included in gross loans.

FIRST FINANCIAL BANCORP.

CREDIT QUALITY

(Dollars in thousands)

(Unaudited)



Mar. 31, Dec. 31, Sep. 30, June 30, Mar. 31,

2021 2020 2020 2020 2020

ALLOWANCE FOR CREDIT LOSS ACTIVITY

Balance at beginning of period $175,679 $168,544 $158,661 $143,885 $57,650

Day one adoption impact of ASC 326 0 0 0 0 61,505

Provision for credit losses 3,450 13,758 15,299 17,859 23,880

Gross charge-offs

Commercial and industrial 7,910 1,505 1,467 1,282 1,091

Lease financing 0 0 852 0 0

Construction real estate 2 0 0 0 0

Commercial real estate 1,250 6,270 3,789 2,037 4

Residential real estate 1 203 22 148 115

Home equity 611 386 460 428 267

Installment 36 21 59 7 61

Credit card 222 169 171 234 311

Total gross charge-offs 10,032 8,554 6,820 4,136 1,849

Recoveries

Commercial and industrial 337 367 265 275 2,000

Lease financing 0 (6) 6 0 0

Construction real estate 0 3 0 14 0

Commercial real estate 195 844 760 424 234

Residential real estate 44 145 91 93 52

Home equity 177 428 209 156 339

Installment 34 65 35 27 31

Credit card 39 85 38 64 43

Total recoveries 826 1,931 1,404 1,053 2,699

Total net charge-offs 9,206 6,623 5,416 3,083 (850)

Ending allowance for credit losses $169,923 $175,679 $168,544 $158,661 $143,885



NET CHARGE-OFFS TO AVERAGE LOANS AND LEASES (ANNUALIZED)

Commercial and industrial 1.01 %0.14 %0.14 %0.13 %(0.15) %

Lease financing 0.00 %0.03 %4.29 %0.00 %0.00 %

Construction real estate 0.00 %0.00 %0.00 %(0.01) %0.00 %

Commercial real estate 0.10 %0.50 %0.28 %0.15 %(0.02) %

Residential real estate (0.02) %0.02 %(0.03) %0.02 %0.02 %

Home equity 0.24 %(0.02) %0.13 %0.14 %(0.04) %

Installment 0.01 %(0.21) %0.12 %(0.10) %0.15 %

Credit card 1.59 %0.69 %1.16 %1.54 %2.15 %

Total net charge-offs 0.38 %0.26 %0.21 %0.12 %(0.04) %



COMPONENTS OF NONPERFORMING LOANS, NONPERFORMING ASSETS, AND UNDERPERFORMING ASSETS

Nonaccrual loans ^(1)

Commercial and industrial $24,941 $29,230 $34,686 $33,906 $21,126

Lease financing 0 0 1,092 1,353 222

Construction real estate 0 0 0 0 0

Commercial real estate 44,514 34,682 24,521 14,002 10,050

Residential real estate 11,359 11,601 12,104 12,813 11,163

Home equity 4,286 5,076 5,374 5,604 5,821

Installment 146 163 153 201 145

Nonaccrual loans 85,246 80,752 77,930 67,879 48,527

Accruing troubled debt restructurings (TDRs) 11,608 7,099 7,759 8,377 22,206

Total nonperforming loans 96,854 87,851 85,689 76,256 70,733

Other real estate owned (OREO) 854 1,287 1,643 1,872 1,467

Total nonperforming assets 97,708 89,138 87,332 78,128 72,200

Accruing loans past due 90 days or more 92 169 79 124 120

Total underperforming assets $97,800 $89,307 $87,411 $78,252 $72,320

Total classified assets $196,782 $142,021 $134,002 $125,543 $124,510



CREDIT QUALITY RATIOS

Allowance for credit losses to

Nonaccrual loans 199.33 %217.55 %216.28 %233.74 %296.51 %

Nonperforming loans 175.44 %199.97 %196.69 %208.06 %203.42 %

Total ending loans 1.71 %1.77 %1.65 %1.56 %1.55 %

Nonperforming loans to total loans 0.97 %0.89 %0.84 %0.75 %0.76 %

Nonperforming assets to

Ending loans, plus OREO 0.98 %0.90 %0.86 %0.77 %0.78 %

Total assets 0.60 %0.56 %0.55 %0.49 %0.48 %

Nonperforming assets, excluding accruing TDRs to

Ending loans, plus OREO 0.87 %0.83 %0.78 %0.68 %0.54 %

Total assets 0.53 %0.51 %0.50 %0.44 %0.33 %

Classified assets to total assets 1.22 %0.89 %0.84 %0.79 %0.83 %



^(1) Nonaccrual loans include nonaccrual TDRs of $20.9 million, $14.7 million,$29.3 million, $32.7 million, and $18.4 million, as of March 31, 2021, December31, 2020, September 30, 2020, June 30, 2020, and March 31, 2020, respectively.

FIRST FINANCIAL BANCORP.

CAPITAL ADEQUACY

(Dollars in thousands, except per share data)

(Unaudited)



Mar. 31, Dec. 31, Sep. 30, June 30, Mar. 31,

2021 2020 2020 2020 2020

PER COMMON SHARE

Market Price

High $26.40 $17.77 $15.15 $16.38 $25.52

Low $17.62 $12.07 $11.40 $11.52 $12.67

Close $24.00 $17.53 $12.01 $13.89 $14.91



Average shares outstanding - basic 96,873,940 97,253,787 97,247,080 97,220,748 97,736,690

Average shares outstanding - diluted 97,727,527 98,020,534 98,008,733 97,988,600 98,356,214

Ending shares outstanding 97,517,693 98,021,929 97,999,763 98,018,858 97,968,958



Total shareholders' equity $2,258,942 $2,282,070 $2,247,815 $2,221,019 $2,179,383



REGULATORY CAPITAL Preliminary

Common equity tier 1 capital $1,334,882 $1,325,922 $1,293,716 $1,267,609 $1,243,152

Common equity tier 1 capital ratio 11.81 %11.82 %11.63 %11.49 %11.27 %

Tier 1 capital $1,377,892 $1,368,818 $1,336,497 $1,310,276 $1,285,705

Tier 1 ratio 12.19 %12.20 %12.02 %11.87 %11.66 %

Total capital $1,741,755 $1,744,802 $1,708,817 $1,676,532 $1,493,100

Total capital ratio 15.41 %15.55 %15.37 %15.19 %13.54 %

Total capital in excess of minimum requirement $554,834 $566,795 $541,263 $517,902 $335,229

Total risk-weighted assets $11,304,012 $11,219,114 $11,119,560 $11,034,570 $11,027,347

Leverage ratio 9.34 %9.55 %9.55 %8.98 %9.49 %



OTHER CAPITAL RATIOS

Ending shareholders' equity to ending assets 13.97 %14.29 %14.11 %13.99 %14.47 %

Ending tangible shareholders' equity to ending tangible assets 8.22 %8.47 %8.25 %8.09 %8.25 %

Average shareholders' equity to average assets 14.17 %14.07 %14.08 %13.91 %15.21 %

Average tangible shareholders' equity to average tangible assets8.38 %8.26 %8.18 %7.94 %8.79 %



REPURCHASE PROGRAM ^(1)

Shares repurchased 840,115 0 0 0 880,000

Average share repurchase price $21.40 N/A N/A N/A $18.96

Total cost of shares repurchased $17,982 N/A N/A N/A $16,686



^(1) Represents share repurchases as part of publicly announced plans.



N/A = Not applicable

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SOURCE First Financial Bancorp.