Business Wire | Jul 23, 2020 05:08PM EDT

Byline Bancorp, Inc. Reports Second Quarter 2020 Financial Results

Jul. 23, 2020

CHICAGO--(BUSINESS WIRE)--Jul. 23, 2020--Byline Bancorp, Inc. (the "Company" or "Byline") (NYSE: BY), the parent company of Byline Bank (the "Bank"), today reported net income of $9.1 million, or $0.24 per diluted share, for the second quarter of 2020, compared with net income of $3.0 million, or $0.07 per diluted share, for the first quarter of 2020, and net income of $13.2 million, or $0.34 per diluted share, for the second quarter of 2019.

Alberto J. Paracchini, President and Chief Executive Officer of Byline, commented, "We continued to operate in a challenging environment due to the ongoing COVID-19 pandemic. Notwithstanding, our team continued to execute well during the second quarter, which enabled us to deliver a solid financial performance while remaining committed to supporting our employees, customers, and communities. We actively participated in the Paycheck Protection Program, and we were able to help more than 3,600 small businesses access approximately $627 million in funding. Our participation in the PPP helped drive strong growth in both loans and deposits during the second quarter. We are also seeing improving demand for government guaranteed loans outside of the PPP, which resulted in a higher level of loan sales this quarter.

"While the pandemic continues, we remain cautious given the uncertainties currently present in the economic outlook. We have increased our reserves through our Allowance for Loan and Lease Losses, added to our capital position with the subordinated debt offering we completed during the quarter, and continue to maintain a high level of liquidity. We believe this approach positions us well to continue to manage through this environment," said Mr. Paracchini.

Byline's Response to Pandemic Update

We continued to execute a series of measures implemented during the prior quarter to ensure the safety of employees, customers, and communities, to support customer needs, and to limit operational disruptions. Our Board of Directors and management teams continue to monitor and, when appropriate, make changes to our response. Recent updates include:

* Maximized social distancing protocols by augmenting business hours and the locations of employee teams. 100% of our non-retail employees have the ability to work from home. Four hub branch locations open and allowing regular lobby traffic, drive-thru only locations for 18 branches, 17 full service branches with lobby hours by appointment, and 18 branches temporarily closed. Continuously following CDC guidelines at branches and offices. * Proactively engaged our customers and borrowers to identify short-term cash flow and other financial needs. Approved 1,800 payment deferrals totaling approximately $619.2 million, or 16.4%1 of loans and leases at June 30, 2020. Established customer strategy to process PPP loans efficiently through our existing SBA platform and funded over 3,600 loans totaling $626.8 million. Approved to participate in the Main Street Lending Facility through the Federal Reserve.

The following table presents information regarding the PPP loans as of June 30, 2020:

PPP Loan Size

Over $150,000 -

(dollars in $0 - $2,000,000 Over Total thousands) $150,000 $2,000,000

Principal $ 119,736 $ 422,218 $ 84,639 $ 626,593 outstanding

Unearned (5,335 ) (13,662 ) (730 ) (19,727 )processing fee

Deferred costs 3,499 1,263 36 4,798

Carrying value $ 117,900 $ 409,819 $ 83,945 $ 611,664

Number of loans 2,628 949 27 3,604

STATEMENTS OF OPERATIONS

Net Interest Income

The following table presents net interest income for the periods indicated:

Three Months Ended Six Months Ended

June 30, March December September June 30, June 30, June 30, 31, 31, 30,

(dollars in 2020 2020 2019 2019 2019 2020 2019 thousands)

INTEREST ANDDIVIDEND INCOME

Interest andfees onloans and $ 50,153 $ 54,158 $ 58,203 $ 63,391 $ 59,524 $ 104,311 $ 113,907

leases

Interest on 7,530 8,016 7,212 7,040 6,665 15,546 12,767 securities

Otherinterest anddividend 222 992 500 598 571 1,214 1,196

income

Totalinterest anddividend 57,905 63,166 65,915 71,029 66,760 121,071 127,870

income

INTEREST EXPENSE

Deposits 4,246 7,804 9,325 9,618 9,306 12,050 17,382

Other 476 1,897 1,989 2,835 2,265 2,373 4,431 borrowings

Subordinatednotes and 574 640 687 738 741 1,214 1,524

debentures

Totalinterest 5,296 10,341 12,001 13,191 12,312 15,637 23,337 expense

Net interest income $ 52,609 $ 52,825 $ 53,914 $ 57,838 $ 54,448 $ 105,434 $ 104,533

The following table presents the average interest-earning assets and average interest-bearing liabilities for the periods indicated:

For the Three Months Ended

June 30, 2020 March 31, 2020

Average Interest Average Average Interest Average(dollars in thousands) Balance^(5) Inc / Yield / Balance^(5) Inc / Yield / Exp Rate Exp Rate

ASSETS

Cash and cash equivalents $ 58,971 $ 25 0.17 % $ 38,934 $ 157 1.63 %

Loans and leases^(1) 4,283,654 50,153 4.71 % 3,799,213 54,158 5.73 %

Taxable securities 1,243,604 7,021 2.27 % 1,175,120 8,316 2.85 %

Tax-exempt securities^(2) 117,340 706 2.42 % 84,679 535 2.54 %

Total interest-earning $ 5,703,569 $ 57,905 4.08 % $ 5,097,946 $ 63,166 4.98 %assets

Allowance for loan and (43,009 ) (33,664 ) lease losses

All other assets 526,414 501,670

TOTAL ASSETS $ 6,186,974 $ 5,565,952

LIABILITIES ANDSTOCKHOLDERS'

EQUITY

Deposits

Interest checking $ 392,070 $ 165 0.17 % $ 338,905 $ 260 0.31 %

Money market accounts 1,214,713 946 0.31 % 962,205 2,214 0.93 %

Savings 511,049 61 0.05 % 480,270 61 0.05 %

Time deposits 976,710 3,074 1.27 % 1,113,596 5,269 1.90 %

Total interest-bearing 3,094,542 4,246 0.55 % 2,894,976 7,804 1.08 %deposits

Other borrowings 534,766 476 0.36 % 521,108 1,897 1.46 %

Subordinated notes and 40,180 574 5.75 % 37,385 640 6.88 %debentures

Total borrowings 574,946 1,050 0.73 % 558,493 2,537 1.83 %

Total interest-bearing $ 3,669,488 $ 5,296 0.58 % $ 3,453,469 $ 10,341 1.20 %liabilities

Non-interest-bearing 1,692,723 1,298,800 demand deposits

Other liabilities 48,884 48,256

Total stockholders' equity 775,879 765,427

TOTAL LIABILITIES AND $ 6,186,974 $ 5,565,952 STOCKHOLDERS' EQUITY

Net interest spread^(3) 3.50 % 3.78 %

Net interest income $ 52,609 $ 52,825

Net interest margin^(4) 3.71 % 4.17 %



Net loan accretion impact $ 3,172 0.22 % $ 3,671 0.29 %on margin

Loan and lease balances are net of deferred origination fees and costs(1) and initial indirect costs. Non-accrual loans and leases are included in total loan and lease balances.

Interest income and rates exclude the effects of a tax equivalent(2) adjustment to adjust tax exempt investment income on tax exempt investment securities to a fully taxable basis due to immateriality.

Represents the average rate earned on interest-earning assets minus the(3) average rate paid on interest-bearing liabilities.

Represents net interest income (annualized) divided by total average(4) earning assets.

Average balances are average daily balances.(5)

Net interest income for the second quarter of 2020 was $52.6 million, relatively the same level as the first quarter of 2020, as a lower cost of funds was offset by a decrease in loan yields.

The change in net interest income was primarily due to:

* A decrease of $3.6 million in interest expense on deposits, due to lower rates paid on money market accounts and maturities of higher-rate time deposits; and * A decrease of $1.5 million in interest expense on borrowings principally as a result of accessing funds available to borrow at a lower cost.

Offset by:

* A decrease of $4.0 million in interest and fees on loans and leases, mainly due to a full quarter impact of the decreases in short-term rates in March 2020, the result of lower-yielding PPP loan balances, and a $499,000 decrease in accretion income on acquired loans.

Net interest margin for the second quarter of 2020 was 3.71%, a decrease of 46 basis points compared to 4.17% for the first quarter of 2020. Total net accretion income on acquired loans contributed 22 basis points to the net interest margin for the second quarter of 2020 compared to 29 basis points for the first quarter of 2020, a decrease of 7 basis points. The net interest margin decrease during the second quarter of 2020 was primarily driven by decreased loan and lease yields largely resulting from a full quarter impact of decreases in short-term rates and lower-yielding PPP loan balances partly offset by a decrease in the cost of funds also due to decreases in short-term rates and higher non-interest-bearing demand deposit balances.

The average cost of total deposits was 0.36% for the second quarter of 2020, a decrease of 39 basis points compared to the first quarter of 2020, mainly due to a lower average cost of money market accounts and time deposits as well as a favorable change in deposit mix. Average non-interest-bearing demand deposits grew by $393.9 million, while average time deposits decreased by $136.9 million. Average non-interest-bearing demand deposits were 35.4% of average total deposits for the second quarter of 2020 compared to 31.4% for the first quarter of 2020.

Provision for Loan and Lease Losses

The provision for loan and lease losses was $15.5 million for the second quarter of 2020, an increase of $1.1 million compared to $14.5 million for the first quarter of 2020. The second quarter included allocations of $14.2 million for originated loans and leases, $862,000 for acquired non-impaired loans, and $477,000 for acquired impaired loans. The provision during the second quarter of 2020 included $5.3 million in specific impairments on originated loans, including $1.4 million related to the unguaranteed portion of government guaranteed loans. The second quarter provision included $7.3 million to address the impact of the COVID-19 pandemic.

Non-interest Income

The following table presents the components of non-interest income for the periods indicated:

Three Months Ended Six Months Ended

June 30, March December September June 30, June 30, June 30, 31, 31, 30,

(dollars in thousands) 2020 2020 2019 2019 2019 2020 2019

NON-INTEREST INCOME

Fees and servicecharges on $ 1,455 $ 1,673 $ 1,635 $ 1,612 $ 1,441 $ 3,128 $ 3,211

deposits

Loan servicing revenue 2,980 2,758 2,834 2,692 2,630 5,738 5,169

Loan servicing asset (711 ) (3,064 ) (2,545 ) (1,610 ) (1,223 ) (3,775 ) (2,484 )revaluation

ATM and interchange 845 1,216 1,150 973 945 2,061 1,662 fees

Net gains on sales ofsecurities - 1,375 - 178 973 1,375 973

available-for-sale

Change in fair value ofequity 766 (619 ) 381 (15 ) 551 147 1,050

securities, net

Net gains on sales of 6,456 4,773 8,735 9,405 7,472 11,229 13,705 loans

Wealth management andtrust 608 669 704 653 626 1,277 1,221

income

Other non-interest 389 392 1,622 918 768 781 1,664 income

Total non-interest $ 12,788 $ 9,173 $ 14,516 $ 14,806 $ 14,183 $ 21,961 $ 26,171 income

Non-interest income for the second quarter of 2020 was $12.8 million, an increase of $3.6 million, or 39.4% compared to $9.2 million for the first quarter of 2020.

The increase in total non-interest income was primarily due to:

* A $2.4 million decrease in loan servicing asset revaluation due to a favorable change in the fair value of the servicing asset as a result of improved secondary market conditions reflected by improved premium rates and lower pre-payment speeds following the initial onset of the COVID-19 pandemic; * An increase of $1.7 million in net gains on sales of loans, mainly due to an increase in volume of sales of government guaranteed loans and improving premiums; and * An increase in the change in fair value of equity securities, net, of $1.4 million due to an increase in the fair value of those securities.

Partially offset by:

* A decrease of $1.4 million in net gains on sales of securities available-for-sale as a result of sales during the first quarter of 2020 compared to none during the second quarter of 2020.

During the second quarter of 2020, the Company sold $78.7 million of U.S. government guaranteed loans compared to $61.0 million during the first quarter of 2020. The increase in sales was driven by increased SBA 7(a) origination volumes.

Non-interest Expense

The following table presents the components of non-interest expense for the periods indicated:

Three Months Ended Six Months Ended

June 30, March December September June 30, June 30, June 30, 31, 31, 30,

(dollars in 2020 2020 2019 2019 2019 2020 2019 thousands)

NON-INTEREST EXPENSE

Salaries andemployee $ 19,405 $ 24,666 $ 24,228 $ 24,537 $ 23,652 $ 44,071 $ 46,544 benefits

Occupancyandequipment 5,359 5,524 5,241 4,512 5,069 10,883 10,018

expense, net

Loan andlease 1,260 1,311 2,648 1,949 1,841 2,571 3,418 relatedexpenses

Legal, auditand otherprofessional 2,078 2,334 2,340 4,066 2,981 4,412 5,047

fees

Data 2,826 2,665 2,678 4,062 3,849 5,491 6,993 processing

Net lossrecognizedon other

real estate 456 519 122 95 252 975 448 owned andother

relatedexpenses

Otherintangibleassets 1,892 1,893 2,002 2,003 1,959 3,785 3,732

amortizationexpense

Othernon-interest 3,736 4,615 4,435 4,224 4,351 8,351 8,433 expense

Totalnon-interest $ 37,012 $ 43,527 $ 43,694 $ 45,448 $ 43,954 $ 80,539 $ 84,633 expense

Non-interest expense for the second quarter of 2020 was $37.0 million, a decrease of $6.5 million, or 15.0%, from $43.5 million for the first quarter of 2020.

The decrease in total non-interest expense was primarily due to:

* A decrease of $5.3 million in salaries and employee benefits, mainly due to an increase in deferred costs as a result of PPP loan originations during the quarter; and * A decrease of $879,000 in other non-interest expense mostly due to a decrease in impairment charges on assets held for sale.

The Company's efficiency ratio was 53.70% for the second quarter of 2020 compared with 67.16% for the first quarter of 2020.

INCOME TAXES

The Company recorded income tax expense of $3.7 million during the second quarter of 2020, an effective tax rate of 29.0% compared to $1.1 million during the first quarter of 2020, an effective tax rate of 26.1%. The change in the effective tax rate was due to the reversal of tax benefits associated with share-based compensation awards.

STATEMENTS OF FINANCIAL CONDITION

Total assets were $6.4 billion at June 30, 2020, an increase of $658.8 million compared to $5.7 billion at March 31, 2020, and an increase of $1.0 billion compared to $5.4 billion at June 30, 2019.

The current quarter increase was primarily due to:

* An increase in securities of $128.2 million, principally a result of purchases of mortgage-backed securities during the quarter; and * An increase in loans and leases of $530.9 million, mostly due to an increase of $610.9 million in our originated loan portfolio reflecting the growth in PPP and commercial real estate loan balances, partially offset by a decrease of $80.1 million in our acquired loan portfolios as a result of paydowns.

The following table shows our allocation of the originated, acquired impaired, and acquired non-impaired loans and leases at the dates indicated:

June 30, 2020 March 31, 2020 June 30, 2019

(dollars in Amount % of Amount % of Amount % of thousands) Total Total Total

Originatedloans and leases

Commercial $ 919,510 20.9 % $ 839,244 21.7 % $ 721,230 18.7 %real estate

Residential 480,692 10.9 % 480,946 12.5 % 501,038 13.0 %real estate

Construction,landdevelopment, 219,261 5.0 % 242,001 6.3 % 196,656 5.1 %and

other land

Commercialand 1,200,996 27.4 % 1,263,688 32.7 % 992,313 25.7 %industrial

Paycheckprotection 611,664 13.9 % - - - - program

Installment 2,714 0.1 % 4,594 0.1 % 10,937 0.3 %and other

Leasingfinancing 160,741 3.7 % 154,173 4.0 % 162,119 4.1 %receivables

Totaloriginated $ 3,595,578 81.9 % $ 2,984,646 77.3 % $ 2,584,293 66.9 %loans andleases

Acquiredimpaired loans

Commercial $ 126,405 2.9 % $ 127,895 3.3 % $ 151,127 3.9 %real estate

Residential 90,784 2.1 % 94,198 2.5 % 118,534 3.1 %real estate

Construction,landdevelopment, 4,784 0.1 % 5,291 0.1 % 4,220 0.1 %and

other land

Commercialand 13,485 0.3 % 15,808 0.4 % 20,370 0.5 %industrial

Installment 226 0.0 % 236 0.0 % 300 0.0 %and other

Totalacquired $ 235,684 5.4 % $ 243,428 6.3 % $ 294,551 7.6 %impairedloans

Acquirednon-impaired loans andleases

Commercial $ 305,041 6.9 % $ 327,820 8.5 % $ 439,182 11.4 %real estate

Residential 99,288 2.2 % 118,853 3.1 % 158,190 4.1 %real estate

Construction,landdevelopment, 21,958 0.5 % 30,484 0.8 % 51,072 1.3 %and

other land

Commercialand 116,668 2.7 % 135,063 3.5 % 307,887 8.0 %industrial

Installment 818 0.0 % 891 0.0 % 1,672 0.0 %and other

Leasingfinancing 16,087 0.4 % 19,074 0.5 % 26,301 0.7 %receivables

Totalacquirednon-impaired $ 559,860 12.7 % $ 632,185 16.4 % $ 984,304 25.5 %loans

and leases

Total loans $ 4,391,122 100.0 % $ 3,860,259 100.0 % $ 3,863,148 100.0 %and leases

Allowance forloan and (51,300 ) (41,840 ) (31,132 ) lease losses

Total loansand leases,net ofallowance for $ 4,339,822 $ 3,818,419 $ 3,832,016

loan andlease losses

ASSET QUALITY

Non-Performing Assets

The following table sets forth the amounts of non-performing loans and leases (excluding acquired impaired), non-performing assets, and other real estate owned at the dates indicated:

June 30, March December September June 30, 31, 31, 30,

(dollars in 2020 2020 2019 2019 2019 thousands)

Non-performing assets:

Non-accrualloans and $ 40,505 $ 48,964 $ 36,272 $ 39,528 $ 34,027 leases

Past due loansand leases 90days or more - - - - 996 and stillaccruinginterest

Accruingtroubled debt 3,151 1,725 1,771 2,204 1,529 restructuredloans

Totalnon-performing 43,656 50,689 38,043 41,732 36,552 loans andleases

Other real 8,652 9,273 9,896 6,502 6,531 estate owned

Totalnon-performing $ 52,308 $ 59,962 $ 47,939 $ 48,234 $ 43,083 assets

Totalnon-performingloans andleases as a 0.99 % 1.31 % 1.00 % 1.09 % 0.95 %

percentage oftotal loansand leases

Totalnon-performingassets as a 0.82 % 1.05 % 0.87 % 0.89 % 0.80 %percentage oftotal assets

Allowance forloan and leaselosses as a

percentage of 117.51 % 82.54 % 83.95 % 75.68 % 85.17 %non-performingloans and

leases



Non-performingassetsguaranteed by

U.S.government:

Non-accrualloans $ 3,755 $ 4,957 $ 4,232 $ 4,167 $ 4,723 guaranteed

Past due loans90 days ormore and still - - - - - accruinginterestguaranteed

Accruingtroubled debtrestructured - - - - - loans

guaranteed

Totalnon-performing $ 3,755 $ 4,957 $ 4,232 $ 4,167 $ 4,723 loansguaranteed

Totalnon-performingloans andleases

not guaranteed 0.91 % 1.18 % 0.89 % 0.98 % 0.82 %as apercentage oftotal

loans andleases

Totalnon-performingassets notguaranteed 0.76 % 0.96 % 0.79 % 0.81 % 0.71 %

as apercentage oftotal assets

Variances in non-performing assets were:

* Non-performing loans and leases were $43.7 million at June 30, 2020, a decrease of $7.0 million from $50.7 million at March 31, 2020, principally due to charge-offs; and * Other real estate owned was $8.7 million at June 30, 2020, a decrease of $621,000 from $9.3 million at March 31, 2020 due to sales and valuation adjustments.

U.S. government guaranteed balances of non-performing loans were $3.8 million at June 30, 2020 and $5.0 million at March 31, 2020.

Allowance for Loan and Lease Losses

The following table presents the balance and activity within the allowance for loan and lease losses for the periods indicated:

Three Months Ended Six Months Ended

June 30, March December September June 30, June 30, June 30, 31, 31, 30,

(dollars in 2020 2020 2019 2019 2019 2020 2019 thousands)

Allowancefor loan andleaselosses, $ 41,840 $ 31,936 $ 31,585 $ 31,132 $ 27,106 $ 31,936 $ 25,201

beginning ofperiod

Provisionfor loan and 15,518 14,455 4,387 5,931 6,391 29,973 10,390 lease losses

Netcharge-offs (6,058 ) (4,551 ) (4,036 ) (5,478 ) (2,365 ) (10,609 ) (4,459 )of loans andleases

Allowancefor loan andleaselosses, $ 51,300 $ 41,840 $ 31,936 $ 31,585 $ 31,132 $ 51,300 $ 31,132

end ofperiod



Allowancefor loan andlease losses

to periodend total 1.17 % 1.08 % 0.84 % 0.82 % 0.81 % 1.17 % 0.81 %loans and

leases heldforinvestment

Netcharge-offs(annualized)to

average 0.57 % 0.48 % 0.42 % 0.56 % 0.25 % 0.53 % 0.25 %loans andleases

outstandingduring theperiod

Provisionfor loan andlease lossesto net 2.56x 3.18x 1.09x 1.08x 2.70x 2.83 x 2.33x charge-offsduring theperiod

The allowance for loan and lease losses as a percentage of total loans and leases held for investment increased to 1.17% at June 30, 2020 compared to 1.08% at March 31, 2020 and 0.81% at June 30, 2019.

In June 2016, the Financial Accounting Standards Board ("FASB") issued new guidance on the recognition of credit losses which replaces the incurred loss impairment methodology with a methodology that reflects expected credit losses. In November 2019, the FASB delayed the effective date of the standard for smaller reporting companies, which includes emerging growth companies. Assuming the Company remains an emerging growth company, the standard is effective for fiscal years beginning after December 15, 2022. The Company is in the process of implementation and determining the impact that this new authoritative guidance will have on the Company's consolidated financial statements.

Net Charge-Offs

Net charge-offs during the second quarter of 2020 were $6.1 million, or 0.57% of average loans and leases, on an annualized basis, an increase of $1.5 million compared to $4.6 million, or 0.48% of average loans and leases, during the first quarter of 2020, and an increase of $3.7 million from $2.4 million, or 0.25%, for the comparable quarter one year ago.

The net charge-offs during the quarter were primarily attributed to commercial and industrial loans. Net charge-offs for the second quarter of 2020 included $2.0 million in the unguaranteed portion of U.S. government guaranteed loans, while net charge-offs for the first quarter of 2020 included $3.4 million and second quarter of 2019 included $2.3 million in the unguaranteed portion of U.S. government guaranteed loans.

Deposits and Other Liabilities

The following table presents the composition of deposits at the dates indicated:

June 30, March 31, December September June 30, 31, 30,

(dollars in thousands) 2020 2020 2019 2019 2019

Non-interest-bearing $ 1,768,675 $ 1,290,896 $ 1,279,641 $ 1,221,431 $ 1,240,375 demand deposits

Interest-bearing checking 503,909 355,678 338,185 372,049 345,081 accounts

Money market demand 1,233,748 1,104,276 881,387 745,154 728,954 accounts

Other savings 525,043 486,131 475,839 471,878 480,756

Time deposits (below 710,429 800,759 916,723 966,866 980,162 $250,000)

Time deposits ($250,000 216,541 201,096 255,802 302,936 284,915 and above)

Total deposits $ 4,958,345 $ 4,238,836 $ 4,147,577 $ 4,080,314 $ 4,060,243

Total deposits were $5.0 billion at June 30, 2020, an increase of $719.5 million compared to March 31, 2020, an increase of 17.0%. Non-interest-bearing deposits were 35.7% of total deposits at June 30, 2020 compared to 30.5% at March 31, 2020.

The increase in the current quarter was primarily due to:

* An increase in non-interest-bearing deposits of $477.8 million, from $1.3 billion at March 31, 2020 to $1.8 billion at June 30, 2020, mostly due to increases in business account balances; * An increase in interest-bearing checking accounts of $148.2 million, from $355.7 million at March 31, 2020 to $503.9 million at June 30, 2020, mostly due to increases in personal and brokered account balances; and * An increase in money market demand deposits of $129.5 million, from $1.1 billion at March 31, 2020 to $1.2 billion at June 30, 2020, largely driven by growth in business and brokered account balances.

Partially offset by:

* A decrease in time deposits of $74.9 million, from $1.0 billion at March 31, 2020 to $927.0 million at June 30, 2020, principally driven by decreases in personal certificates.

Total borrowings and other liabilities were $654.2 million at June 30, 2020, a decrease of $79.0 million from $733.3 million at March 31, 2020.

Stockholders' Equity

Total stockholders' equity was $780.9 million at June 30, 2020, an increase of $18.3 million from $762.7 million at March 31, 2020. The increase was due to the increase in accumulated other comprehensive income reflecting the unrealized gains in our available-for-sale securities portfolio in addition to net income generated during the quarter less dividends declared.

The following table presents the actual regulatory capital dollar amounts and ratios of the Company and Byline Bank as of June 30, 2020:

Minimum Capital Required to be Actual Required Considered Well Capitalized

June 30, Amount Ratio Amount Ratio Amount Ratio 2020

Totalcapitalto risk weightedassets:

Company $ 712,081 15.86 % $ 359,161 8.00 % N/A N/A

Bank 635,920 14.21 % 358,043 8.00 % $ 447,554 10.00 %

Tier 1capitalto risk weightedassets:

Company $ 608,931 13.56 % $ 269,371 6.00 % N/A N/A

Bank 582,770 13.02 % 268,532 6.00 % $ 358,043 8.00 %

CommonEquityTier 1(CET1) to riskweightedassets:

Company $ 553,493 12.33 % $ 202,028 4.50 % N/A N/A

Bank 582,770 13.02 % 201,399 4.50 % $ 290,910 6.50 %

Tier 1capitalto averageassets:

Company $ 608,931 10.29 % $ 236,702 4.00 % N/A N/A

Bank 582,770 9.85 % 236,555 4.00 % $ 295,694 5.00 %

Capital ratios for the period presented are based on the Basel III regulatory capital framework as applied to the Company's current business and operations, and are subject to, among other things, completion and filing of the Company's regulatory reports and ongoing regulatory review and implementation guidance.

On June 26, 2020, the Company completed a public offering of $50.0 million aggregate principal amount of 6.00% fixed-to-floating rate subordinated notes due July 1, 2030. The subordinated notes bear a fixed interest rate of 6.00% until July 1, 2025 and a floating interest rate equal to a benchmark rate, which is expected to be three-month term SOFR plus 588 basis points thereafter until maturity. The subordinated notes are intended to qualify as Tier 2 capital for regulatory capital purposes.

Conference Call, Webcast and Slide Presentation

The Company will host a conference call and webcast at 9:00 a.m. Central Time (10:00 a.m. Eastern Time) on Friday, July 24, 2020 to discuss its quarterly financial results. Analysts and investors may participate in the question-and-answer session. The call can be accessed via telephone at (877) 512-8755. A recorded replay can be accessed through August 7, 2020 by dialing (877) 344-7529; passcode: 10146069.

A slide presentation relating to the second quarter 2020 results will be accessible prior to the scheduled conference call. The slide presentation and webcast of the conference call can be accessed on the News and Events page of the Company's investor relations website at www.bylinebancorp.com.

About Byline Bancorp, Inc.

Headquartered in Chicago, Byline Bancorp, Inc. is the parent company for Byline Bank, a full service commercial bank serving small- and medium-sized businesses, financial sponsors, and consumers. Byline Bank has approximately $6.4 billion in assets and operates more than 50 full service branch locations throughout the Chicago and Milwaukee metropolitan areas. Byline Bank offers a broad range of commercial and retail banking products and services including small ticket equipment leasing solutions and is one of the top five Small Business Administration lenders in the United States.

Non-GAAP Financial Measures

This release contains certain financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America ("GAAP"). These measures include adjusted net income, adjusted diluted earnings per share, adjusted efficiency ratio, adjusted non-interest expense to average assets, non-interest income to total revenues, adjusted return on average stockholders' equity, adjusted return on average assets, pre-tax pre-provision return on average assets, adjusted pre-tax pre-provision return on average assets, tangible book value per common share, tangible common equity to tangible assets, return on average tangible common stockholders' equity, and adjusted return on average tangible common stockholders' equity. Management believes that these non-GAAP financial measures provide useful information to management and investors that is supplementary to the Company's financial condition, results of operations and cash flows computed in accordance with GAAP; however, management acknowledges that our non-GAAP financial measures have a number of limitations. As such, these disclosures should not be viewed as a substitute for results determined in accordance with GAAP financial measures that we and other companies use. Management also uses these measures for peer comparison. See "Reconciliation of Non-GAAP Financial Measures" in the financial schedules included in this press release for a reconciliation of the non-GAAP financial measures to the comparable GAAP financial measures. Additionally, please refer to the Company's Annual Report on Form 10-K for the detailed definitions of these non-GAAP financial measures.

Forward-Looking Statements

This communication contains forward-looking statements within the meaning of the U.S. federal securities laws. Forward-looking statements include, without limitation, statements concerning plans, estimates, calculations, forecasts and projections with respect to the anticipated future performance of the Company. These statements are often, but not always, made through the use of words or phrases such as ''may'', ''might'', ''should'', ''could'', ''predict'', ''potential'', ''believe'', ''expect'', ''continue'', ''will'', ''anticipate'', ''seek'', ''estimate'', ''intend'', ''plan'', ''projection'', ''would'', ''annualized'', "target" and ''outlook'', or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. Forward-looking statements involve estimates and known and unknown risks, and reflect various assumptions and involve elements of subjective judgement and analysis, which may or may not prove to be correct, and which are subject to uncertainties and contingencies outside the control of Byline and its respective affiliates, directors, employees and other representatives, which could cause actual results to differ materially from those presented in this communication.

The COVID-19 pandemic is adversely affecting us, our employees, customers, counterparties and third-party service providers, and the ultimate extent of the impacts on our business, financial position, results of operations, liquidity, and prospects is uncertain. Continued deterioration in general business and economic conditions, including further increases in unemployment rates, or turbulence in U.S. or global financial markets could adversely affect our revenues and the values of our assets and liabilities, reduce the availability of funding, lead to a tightening of credit, and further increase stock price volatility. In addition, changes to statutes, regulations, or regulatory policies or practices as a result of, or in response to COVID-19, could affect us in substantial and unpredictable ways.

No representations, warranties or guarantees are or will be made by Byline as to the reliability, accuracy or completeness of any forward-looking statements contained in this communication or that such forward-looking statements are or will remain based on reasonable assumptions. You should not place undue reliance on any forward-looking statements contained in this communication.

Certain risks and important factors that could affect Byline's future results are identified in its Annual Report on Form 10-K and other reports filed with the Securities and Exchange Commission, including among other things under the heading "Risk Factors" in its Annual Report on Form 10-K for the year ended December 31, 2019, and its Quarterly Report on Form 10-Q for the quarter ended March 31, 2020. Any forward-looking statement speaks only as of the date on which it is made, and Byline undertakes no obligation to update any forward-looking statement, whether to reflect events or circumstances after the date on which the statement is made, to reflect new information or the occurrence of unanticipated events, or otherwise unless required under the federal securities laws.

BYLINE BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (unaudited)

June 30, March 31, December September June 30, 31, 30,

(dollars in 2020 2020 2019 2019 2019 thousands)

ASSETS

Cash and due from $ 51,818 $ 45,233 $ 48,228 $ 75,275 $ 57,513 banks

Interest bearingdeposits with other 88,113 74,386 32,509 33,564 31,802 banks

Cash and cash 139,931 119,619 80,737 108,839 89,315 equivalents

Equity and othersecurities, at fair 8,181 7,413 8,031 7,648 7,662 value

Securitiesavailable-for-sale, 1,426,871 1,299,483 1,186,292 1,031,933 969,029 at fair value

Securitiesheld-to-maturity, at 4,404 4,408 4,412 4,417 4,421 amortized cost

Restricted stock, at 6,232 24,197 22,127 24,331 22,937 cost

Loans held for sale 3,031 13,299 11,732 7,176 18,473

Loans and leases:

Loans and leases 4,391,122 3,860,259 3,785,661 3,831,090 3,863,148

Allowance for loan (51,300 ) (41,840 ) (31,936 ) (31,585 ) (31,132 )and lease losses

Net loans and leases 4,339,822 3,818,419 3,753,725 3,799,505 3,832,016

Servicing assets, at 18,351 17,800 19,471 19,939 19,760 fair value

Premises and 95,546 96,446 96,140 96,006 96,588 equipment, net

Other real estate 8,652 9,273 9,896 6,502 6,531 owned, net

Goodwill and otherintangible assets, 176,470 178,362 180,255 179,543 181,546 net

Bank-owned life 9,896 9,898 9,750 9,699 9,634 insurance

Deferred tax assets, 37,082 33,845 38,315 33,388 35,737 net

Accrued interestreceivable and other 119,049 102,292 100,926 109,352 97,587 assets

Total assets $ 6,393,518 $ 5,734,754 $ 5,521,809 $ 5,438,278 $ 5,391,236

LIABILITIES AND STOCKHOLDERS' EQUITY

LIABILITIES

Non-interest-bearing $ 1,768,675 $ 1,290,896 $ 1,279,641 $ 1,221,431 $ 1,240,375 demand deposits

Interest-bearing 3,189,670 2,947,940 2,867,936 2,858,883 2,819,868 deposits

Total deposits 4,958,345 4,238,836 4,147,577 4,080,314 4,060,243

Other borrowings 510,414 640,647 539,638 538,290 532,885

Subordinated notes, 48,777 - - - - net

Junior subordinateddebentures issued to 36,206 37,462 37,334 37,207 37,059

capital trusts, net

Accrued expenses and 58,841 55,142 47,145 46,601 43,374 other liabilities

Total liabilities 5,612,583 4,972,087 4,771,694 4,702,412 4,673,561

STOCKHOLDERS' EQUITY

Preferred stock 10,438 10,438 10,438 10,438 10,438

Common stock 381 380 379 378 378

Additional paid-in 583,307 582,517 580,965 579,564 578,828 capital

Retained earnings 168,444 160,652 159,033 144,525 129,379

Treasury stock (1,668 ) (1,668 ) - - -

Accumulated othercomprehensive income 20,033 10,348 (700 ) 961 (1,348 )

(loss), net of tax

Total stockholders' 780,935 762,667 750,115 735,866 717,675 equity

Total liabilitiesand stockholders' $ 6,393,518 $ 5,734,754 $ 5,521,809 $ 5,438,278 $ 5,391,236 equity

BYLINE BANCORP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)



Three Months Ended Six Months Ended

June 30, March December September June 30, June 30, June 30, 31, 31, 30,

(dollars inthousands, except 2020 2020 2019 2019 2019 2020 2019 per share data)

INTEREST AND DIVIDEND INCOME

Interest and feeson loans and $ 50,153 $ 54,158 $ 58,203 $ 63,391 $ 59,524 $ 104,311 $ 113,907 leases

Interest on 7,530 8,016 7,212 7,040 6,665 15,546 12,767 securities

Other interest and 222 992 500 598 571 1,214 1,196 dividend income

Total interest and 57,905 63,166 65,915 71,029 66,760 121,071 127,870 dividend income

INTEREST EXPENSE

Deposits 4,246 7,804 9,325 9,618 9,306 12,050 17,382

Other borrowings 476 1,897 1,989 2,835 2,265 2,373 4,431

Subordinated notes 574 640 687 738 741 1,214 1,524 and debentures

Total interest 5,296 10,341 12,001 13,191 12,312 15,637 23,337 expense

Net interest 52,609 52,825 53,914 57,838 54,448 105,434 104,533 income

PROVISION FOR LOAN 15,518 14,455 4,387 5,931 6,391 29,973 10,390 AND LEASE LOSSES

Net interestincome afterprovision 37,091 38,370 49,527 51,907 48,057 75,461 94,143

for loan and leaselosses

NON-INTEREST INCOME

Fees and servicecharges on 1,455 1,673 1,635 1,612 1,441 3,128 3,211 deposits

Loan servicing 2,980 2,758 2,834 2,692 2,630 5,738 5,169 revenue

Loan servicing (711 ) (3,064 ) (2,545 ) (1,610 ) (1,223 ) (3,775 ) (2,484 )asset revaluation

ATM and 845 1,216 1,150 973 945 2,061 1,662 interchange fees

Net gains on salesof securities - 1,375 - 178 973 1,375 973 available-for-sale

Change in fairvalue of equity 766 (619 ) 381 (15 ) 551 147 1,050 securities, net

Net gains on sales 6,456 4,773 8,735 9,405 7,472 11,229 13,705 of loans

Wealth management 608 669 704 653 626 1,277 1,221 and trust income

Other non-interest 389 392 1,622 918 768 781 1,664 income

Total non-interest 12,788 9,173 14,516 14,806 14,183 21,961 26,171 income

NON-INTEREST EXPENSE

Salaries and 19,405 24,666 24,228 24,537 23,652 44,071 46,544 employee benefits

Occupancy andequipment expense, 5,359 5,524 5,241 4,512 5,069 10,883 10,018 net

Loan and lease 1,260 1,311 2,648 1,949 1,841 2,571 3,418 related expenses

Legal, audit, andother professional 2,078 2,334 2,340 4,066 2,981 4,412 5,047 fees

Data processing 2,826 2,665 2,678 4,062 3,849 5,491 6,993

Net lossrecognized onother real estateowned and other 456 519 122 95 252 975 448 related

expenses

Other intangibleassets 1,892 1,893 2,002 2,003 1,959 3,785 3,732 amortizationexpense

Other non-interest 3,736 4,615 4,435 4,224 4,351 8,351 8,433 expense

Total non-interest 37,012 43,527 43,694 45,448 43,954 80,539 84,633 expense

INCOME BEFOREPROVISION FORINCOME 12,867 4,016 20,349 21,265 18,286 16,883 35,681

TAXES

PROVISION FOR 3,728 1,050 4,497 5,923 5,075 4,778 9,873 INCOME TAXES

NET INCOME 9,139 2,966 15,852 15,342 13,211 12,105 25,808

Dividends on 195 196 196 196 195 391 391 preferred shares

INCOME AVAILABLETO COMMON $ 8,944 $ 2,770 $ 15,656 $ 15,146 $ 13,016 $ 11,714 $ 25,417 STOCKHOLDERS

EARNINGS PER COMMON SHARE

Basic $ 0.24 $ 0.07 $ 0.41 $ 0.40 $ 0.35 $ 0.31 $ 0.69

Diluted $ 0.24 $ 0.07 $ 0.41 $ 0.39 $ 0.34 $ 0.31 $ 0.68

BYLINE BANCORP, INC. AND SUBSIDIARIES

SELECTED FINANCIAL DATA (unaudited)

As of or For the Three Months Ended As of or For the Six Months Ended

(dollars inthousands, except June 30, March 31, December 31, September June 30, June 30, June 30, share and per share 30,data)

2020 2020 2019 2019 2019 2020 2019

Common Share Data

Basic earnings per $ 0.24 $ 0.07 $ 0.41 $ 0.40 $ 0.35 $ 0.31 $ 0.69 common share

Diluted earnings per $ 0.24 $ 0.07 $ 0.41 $ 0.39 $ 0.34 $ 0.31 $ 0.68 common share

Adjusted dilutedearnings per common $ 0.24 $ 0.09 $ 0.42 $ 0.41 $ 0.41 $ 0.32 $ 0.79 share^(2)(3)(4)

Weighted averagecommon shares 37,919,480 37,943,333 37,872,835 37,831,356 37,263,352 37,931,406 36,719,436 outstanding (basic)

Weighted averagecommon shares 38,027,289 38,663,658 38,537,899 38,487,180 37,948,006 38,350,064 37,445,407 outstanding(diluted)

Common shares 38,388,217 38,383,021 38,256,500 38,169,126 38,115,219 38,388,217 38,115,219 outstanding

Cash dividends per $ 0.03 $ 0.03 $ 0.03 N/A N/A $ 0.06 N/A common share

Dividend payoutratio on common 12.50 % 42.86 % 7.32 % N/A N/A 19.35 % N/A stock

Tangible book value $ 15.47 $ 14.95 $ 14.62 $ 14.30 $ 13.79 $ 15.47 $ 13.79 per common share^(1)



Key Ratios andPerformance Metrics (annualized whereapplicable)

Net interest margin 3.71 % 4.17 % 4.32 % 4.62 % 4.51 % 3.93 % 4.47 %

Average cost of 0.36 % 0.75 % 0.88 % 0.94 % 0.92 % 0.54 % 0.90 %deposits

Efficiency ratio^(2) 53.70 % 67.16 % 60.93 % 59.81 % 61.19 % 60.25 % 61.90 %

Adjusted efficiency 53.70 % 66.00 % 60.51 % 58.17 % 56.02 % 59.69 % 57.70 %ratio^(1)(2)(3)

Non-interest expense 2.41 % 3.15 % 3.19 % 3.32 % 3.34 % 2.76 % 3.33 %to average assets

Adjustednon-interest expenseto 2.41 % 3.09 % 3.17 % 3.23 % 3.07 % 2.73 % 3.12 %

average assets^(1)(3)

Return on average 4.74 % 1.56 % 8.43 % 8.34 % 7.60 % 3.16 % 7.67 %stockholders' equity

Adjusted return onaverage 4.74 % 1.83 % 8.54 % 8.78 % 9.16 % 3.29 % 8.90 %stockholders' equity^(1)(3)(4)

Return on average 0.59 % 0.21 % 1.16 % 1.12 % 1.00 % 0.41 % 1.02 %assets

Adjusted return onaverage 0.59 % 0.25 % 1.17 % 1.18 % 1.21 % 0.43 % 1.18 %

assets^(1)(3)(4)

Non-interest incometo total 19.56 % 14.79 % 21.21 % 20.38 % 20.67 % 17.24 % 20.02 %

revenues^(1)

Pre-taxpre-provision returnon 1.85 % 1.33 % 1.81 % 1.98 % 1.88 % 1.60 % 1.81 %

average assets^(1)

Adjusted pre-taxpre-provision return 1.85 % 1.39 % 1.83 % 2.07 % 2.15 % 1.63 % 2.03 %on average assets^(1)(3)

Return on averagetangible common 7.05 % 2.89 % 12.20 % 12.22 % 11.32 % 4.99 % 11.35 %stockholders' equity^(1)

Adjusted return onaverage tangible 7.05 % 3.25 % 12.35 % 12.82 % 13.44 % 5.17 % 13.00 %common stockholders'equity^(1)(3)

Non-interest-bearingdeposits to total 35.67 % 30.45 % 30.85 % 29.93 % 30.55 % 35.67 % 30.55 %deposits

Loans and leasesheld for sale andloans and lease held 88.62 % 91.38 % 91.56 % 94.07 % 95.60 % 88.62 % 95.60 %for investment tototal deposits

Deposits to total 88.34 % 85.25 % 86.92 % 86.77 % 86.88 % 88.34 % 86.88 %liabilities

Deposits per branch $ 86,989 $ 74,366 $ 67,993 $ 66,890 $ 66,561 $ 86,989 $ 66,561



Asset Quality Ratios

Non-performing loansand leases to totalloans and leases 0.99 % 1.31 % 1.00 % 1.09 % 0.95 % 0.99 % 0.95 %held for investment,net before ALLL

ALLL to total loansand leases held for 1.17 % 1.08 % 0.84 % 0.82 % 0.81 % 1.17 % 0.81 %investment, netbefore ALLL

Net charge-offs toaverage total loansand leases held for 0.57 % 0.48 % 0.42 % 0.56 % 0.25 % 0.53 % 0.25 %investment, netbefore ALLL

Acquisitionaccounting $ 19,324 $ 25,889 $ 28,511 $ 31,053 $ 37,109 $ 19,324 $ 37,109 adjustments^(4)



Capital Ratios

Common equity to 12.05 % 13.12 % 13.40 % 13.34 % 13.12 % 12.05 % 13.12 %total assets

Tangible commonequity to tangible 9.55 % 10.33 % 10.47 % 10.38 % 10.09 % 9.55 % 10.09 %assets^(1)

Leverage ratio 10.29 % 11.18 % 11.39 % 11.14 % 11.09 % 10.29 % 11.09 %

Common equity tier 1 12.33 % 12.24 % 12.36 % 12.12 % 11.65 % 12.33 % 11.65 %capital ratio

Tier 1 capital ratio 13.56 % 13.52 % 13.67 % 13.43 % 12.96 % 13.56 % 12.96 %

Total capital ratio 15.86 % 14.50 % 14.43 % 14.19 % 13.71 % 15.86 % 13.71 %

Represents a non-GAAP financial measure. See "Reconciliation of non-GAAP(1) Financial Measures" for a reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measure.

Represents non-interest expense less amortization of intangible assets(2) divided by net interest income and non-interest income.

Calculation excludes impairment charges, merger-related expenses, and(3) core systems conversion expense.

Represents the remaining net unaccreted discount as a result of applying(4) the fair value adjustment at the time of the business combination on acquired loans.

BYLINE BANCORP, INC. AND SUBSIDIARIES

QUARTER-TO-DATE STATEMENT OF AVERAGE INTEREST-EARNING ASSETS AND AVERAGEINTEREST-BEARING LIABILITIES (unaudited)

For the Three Months Ended June 30,

2020 2019

Average Interest Average Average Interest Average(dollars in thousands) Balance^(5) Inc / Yield / Balance^(5) Inc / Yield / Exp Rate Exp Rate

ASSETS

Cash and cash equivalents $ 58,971 $ 25 0.17 % $ 35,346 $ 245 2.78 %

Loans and leases^(1) 4,283,654 50,153 4.71 % 3,759,634 59,524 6.35 %

Taxable securities 1,243,604 7,021 2.27 % 975,693 6,563 2.70 %

Tax-exempt securities^(2) 117,340 706 2.42 % 68,314 428 2.52 %

Total interest-earning $ 5,703,569 $ 57,905 4.08 % $ 4,838,987 $ 66,760 5.53 %assets

Allowance for loan and (43,009 ) (28,203 ) lease losses

All other assets 526,414 464,036

TOTAL ASSETS $ 6,186,974 $ 5,274,820

LIABILITIES ANDSTOCKHOLDERS'

EQUITY

Deposits

Interest checking $ 392,070 $ 165 0.17 % $ 333,725 $ 452 0.54 %

Money market accounts 1,214,713 946 0.31 % 695,986 1,790 1.03 %

Savings 511,049 61 0.05 % 477,775 118 0.10 %

Time deposits 976,710 3,074 1.27 % 1,278,488 6,946 2.18 %

3,094,542 4,246 0.55 % 2,785,974 9,306 1.34 %

Other borrowings 534,766 476 0.36 % 462,841 2,265 1.96 %

Subordinated notes and 40,180 574 5.75 % 36,963 741 8.04 %debentures

Total borrowings 574,946 1,050 0.73 % 499,804 3,006 2.41 %

Total interest-bearing $ 3,669,488 $ 5,296 0.58 % $ 3,285,778 $ 12,312 1.50 %liabilities

Non-interest-bearing 1,692,723 1,254,173 demand deposits

Other liabilities 48,884 37,941

Total stockholders' 775,879 696,928 equity

TOTAL LIABILITIES AND $ 6,186,974 $ 5,274,820 STOCKHOLDERS' EQUITY

Net interest spread^(3) 3.50 % 4.03 %

Net interest income $ 52,609 $ 54,448

Net interest margin^(4) 3.71 % 4.51 %



Net loan accretion impact $ 3,172 0.22 % $ 4,868 0.40 %on margin

Loan and lease balances are net of deferred origination fees and costs(1) and initial indirect costs. Non-accrual loans and leases are included in total loan and lease balances.

Interest income and rates exclude the effects of a tax equivalent(2) adjustment to adjust tax exempt investment income on tax exempt investment securities to a fully taxable basis due to immateriality.

Represents the average rate earned on interest-earning assets minus the(3) average rate paid on interest-bearing liabilities.

Represents net interest income (annualized) divided by total average(4) earning assets.

Average balances are average daily balances.(5)

BYLINE BANCORP, INC. AND SUBSIDIARIES

YEAR-TO-DATE STATEMENT OF AVERAGE INTEREST-EARNING ASSETS AND AVERAGEINTEREST-BEARING LIABILITIES (unaudited)

For the Six Months Ended June 30,

2020 2019

Average Interest Average Average Interest Average(dollars in thousands) Balance^(5) Inc / Exp Yield / Balance^(5) Inc / Exp Yield / Rate Rate

ASSETS

Cash and cash equivalents $ 48,952 $ 182 0.75 % $ 50,969 $ 546 2.16 %

Loans and leases^(1) 4,041,433 104,311 5.19 % 3,647,427 113,907 6.30 %

Taxable securities 1,209,362 15,337 2.55 % 951,048 12,646 2.68 %

Tax-exempt securities^(2) 101,010 1,241 2.47 % 61,792 771 2.52 %

Total interest-earning $ 5,400,757 $ 121,071 4.51 % $ 4,711,236 $ 127,870 5.47 %assets

Allowance for loan and (38,336 ) (26,786 ) lease losses

All other assets 514,042 435,672

TOTAL ASSETS $ 5,876,463 $ 5,120,122

LIABILITIES ANDSTOCKHOLDERS'

EQUITY

Deposits

Interest checking $ 365,487 $ 425 0.23 % $ 313,499 $ 866 0.56 %

Money market accounts 1,088,459 3,160 0.58 % 654,723 3,249 1.00 %

Savings 495,660 122 0.05 % 474,509 257 0.11 %

Time deposits 1,045,153 8,343 1.61 % 1,237,182 13,010 2.12 %

Total interest-bearing 2,994,759 12,050 0.81 % 2,679,913 17,382 1.31 %deposits

Other borrowings 527,937 2,373 0.90 % 465,325 4,431 1.92 %

Subordinated notes and 38,782 1,214 6.88 % 36,890 1,524 8.33 %debentures

Total borrowings 566,719 3,587 1.27 % 502,215 5,955 2.39 %

Total interest-bearing $ 3,561,478 $ 15,637 0.88 % $ 3,182,128 $ 23,337 1.48 %liabilities

Non-interest-bearing demand 1,495,761 1,220,266 deposits

Other liabilities 48,571 39,582

Total stockholders' equity 770,653 678,146

TOTAL LIABILITIES AND $ 5,876,463 $ 5,120,122 STOCKHOLDERS' EQUITY

Net interest spread^(3) 3.63 % 3.99 %

Net interest income $ 105,434 $ 104,533

Net interest margin^(4) 3.93 % 4.47 %



Net loan accretion impact $ 6,843 0.25 % $ 10,069 0.43 %on margin

Loan and lease balances are net of deferred origination fees and costs and(1) initial indirect costs. Non-accrual loans and leases are included in total loan and lease balances.

Interest income and rates exclude the effects of a tax equivalent(2) adjustment to adjust tax exempt investment income on tax exempt investment securities to a fully taxable basis due to immateriality.

Represents the average rate earned on interest-earning assets minus the(3) average rate paid on interest-bearing liabilities.

Represents net interest income (annualized) divided by total average(4) earning assets.

Average balances are average daily balances.(5)

BYLINE BANCORP, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (unaudited)

As of or For the Six As of or For the Three Months Ended Months Ended

(dollars in June March December Septemberthousands, 30, 31, 31, 30, June 30, June 30, June 30, except per 2020 2020 2019 2019 2019 2020 2019share data)

Net income andearnings pershare excludingsignificantitems

Reported Net $ 9,139 $ 2,966 $ 15,852 $ 15,342 $ 13,211 $ 12,105 $ 25,808 Income

Significant items:

Impairmentcharges on - 715 111 67 - 715 392 assets heldfor sale

Merger-related - - 127 1,043 3,152 - 3,170 expense

Core systemconversion - - 48 77 394 - 1,924 expense

Tax benefit onimpairmentcharges and - (199 ) (79 ) (369 ) (842 ) (199 ) (1,382 )

merger-relatedexpenses

Adjusted Net $ 9,139 $ 3,482 $ 16,059 $ 16,160 $ 15,915 $ 12,621 $ 29,912 Income

ReportedDiluted $ 0.24 $ 0.07 $ 0.41 $ 0.39 $ 0.34 $ 0.31 $ 0.68 Earnings perShare

Significant items:

Impairmentcharges on - 0.02 - - - 0.02 0.01 assets heldfor sale

Merger-related - - 0.01 0.03 0.08 - 0.09 expense

Core systemconversion - - - - 0.01 - 0.05 expense

Tax benefit onimpairmentcharges and - - - (0.01 ) (0.02 ) (0.01 ) (0.04 )

merger-relatedexpenses

AdjustedDiluted $ 0.24 $ 0.09 $ 0.42 $ 0.41 $ 0.41 $ 0.32 $ 0.79 Earnings perShare

BYLINE BANCORP, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (continued) (unaudited)

As of or For the Three Months Ended As of or For the Six Months Ended

(dollars inthousands,except per December Septembershare data, June 30, March 31, 31, 30, June 30, June 30, June 30, ratios 2020 2020 2019 2019 2019 2020 2019annualized,whereapplicable)

Adjustednon-interest expense:

Non-interest $ 37,012 $ 43,527 $ 43,694 $ 45,448 $ 43,954 $ 80,539 $ 84,633 expense

Less:Significant items

Impairmentcharges on - 715 111 67 - 715 392 assets heldfor sale

Merger-related - - 127 1,043 3,152 - 3,170 expense

Core systemconversion - - 48 77 394 - 1,924 expense

Adjustednon-interest $ 37,012 $ 42,812 $ 43,408 $ 44,261 $ 40,408 $ 79,824 $ 79,147 expense

Adjustednon-interestexpenseexcluding amortizationof intangibleassets:

Adjustednon-interest $ 37,012 $ 42,812 $ 43,408 $ 44,261 $ 40,408 $ 79,824 $ 79,147 expense

Less:Amortization 1,892 1,893 2,002 2,003 1,959 3,785 3,732 of intangibleassets

Adjustednon-interestexpenseexcluding $ 35,120 $ 40,919 $ 41,406 $ 42,258 $ 38,449 $ 76,039 $ 75,415

amortizationof intangibleassets

Pre-taxpre-provision net income:

Pre-tax income $ 12,867 $ 4,016 $ 20,349 $ 21,265 $ 18,286 $ 16,883 $ 35,681

Add: Provisionfor loan and 15,518 14,455 4,387 5,931 6,391 29,973 10,390 lease losses

Pre-taxpre-provision $ 28,385 $ 18,471 $ 24,736 $ 27,196 $ 24,677 $ 46,856 $ 46,071 net income

Adjustedpre-tax pre-provisionnet income:

Pre-taxpre-provision $ 28,385 $ 18,471 $ 24,736 $ 27,196 $ 24,677 $ 46,856 $ 46,071 net income

Impairmentcharges on - 715 111 67 - 715 392 assets heldfor sale

Merger-related - - 127 1,043 3,152 - 3,170 expense

Core systemconversion - - 48 77 394 - 1,924 expense

Adjustedpre-tax $ 28,385 $ 19,186 $ 25,022 $ 28,383 $ 28,223 $ 47,571 $ 51,557 pre-provisionnet income

Total revenues:

Net interest $ 52,609 $ 52,825 $ 53,914 $ 57,838 $ 54,448 $ 105,434 $ 104,533 income

Add:Non-interest 12,788 9,173 14,516 14,806 14,183 21,961 26,171 income

Total revenues $ 65,397 $ 61,998 $ 68,430 $ 72,644 $ 68,631 $ 127,395 $ 130,704

Tangiblecommon stockholders'equity:

Totalstockholders' $ 780,935 $ 762,667 $ 750,115 $ 735,866 $ 717,675 $ 780,935 $ 717,675 equity

Less:Preferred 10,438 10,438 10,438 10,438 10,438 10,438 10,438 stock

Less: Goodwilland other 176,470 178,362 180,255 179,543 181,546 176,470 181,546 intangibles

Tangiblecommon $ 594,027 $ 573,867 $ 559,422 $ 545,885 $ 525,691 $ 594,027 $ 525,691 stockholders'equity

Tangible assets:

Total assets $ 6,393,518 $ 5,734,754 $ 5,521,809 $ 5,438,278 $ 5,391,236 $ 6,393,518 $ 5,391,236

Less: Goodwilland other 176,470 178,362 180,255 179,543 181,546 176,470 181,546 intangibles

Tangible $ 6,217,048 $ 5,556,392 $ 5,341,554 $ 5,258,735 $ 5,209,690 $ 6,217,048 $ 5,209,690 assets

Averagetangiblecommon stockholders'equity:

Average totalstockholders' $ 775,879 $ 765,427 $ 745,745 $ 729,781 $ 696,928 $ 770,653 $ 678,146 equity

Less: Averagepreferred 10,438 10,438 10,438 10,438 10,438 10,438 10,438 stock

Less: Averagegoodwill andother 177,440 179,416 179,192 180,740 175,236 178,428 168,120

intangibles

Averagetangiblecommon $ 588,001 $ 575,573 $ 556,115 $ 538,603 $ 511,254 $ 581,787 $ 499,588 stockholders'equity

Averagetangible assets:

Average total $ 6,186,974 $ 5,565,952 $ 5,427,046 $ 5,435,762 $ 5,274,820 $ 5,876,463 $ 5,120,122 assets

Less: Averagegoodwill andother 177,440 179,416 179,192 180,740 175,236 178,428 168,120

intangibles

Averagetangible $ 6,009,534 $ 5,386,536 $ 5,247,854 $ 5,255,022 $ 5,099,584 $ 5,698,035 $ 4,952,002 assets

Tangible netincomeavailable to common

stockholders:

Net incomeavailable to $ 8,944 $ 2,770 $ 15,656 $ 15,146 $ 13,016 $ 11,714 $ 25,417 commonstockholders

Add: After-taxintangible 1,365 1,366 1,445 1,445 1,413 2,731 2,692 assetamortization

Tangible netincomeavailable to $ 10,309 $ 4,136 $ 17,101 $ 16,591 $ 14,429 $ 14,445 $ 28,109 commonstockholders

Adjustedtangible netincomeavailable to common

stockholders:

Tangible netincomeavailable to $ 10,309 $ 4,136 $ 17,101 $ 16,591 $ 14,429 $ 14,445 $ 28,109 commonstockholders

Impairmentcharges on - 715 111 67 - 715 392 assets heldfor sale

Merger-related - - 127 1,043 3,152 - 3,170 expense

Core systemconversion - - 48 77 394 - 1,924 expense

Tax benefit onsignificant - (199 ) (79 ) (369 ) (842 ) (199 ) (1,382 )items

Adjustedtangible netincome $ 10,309 $ 4,652 $ 17,308 $ 17,409 $ 17,133 $ 14,961 $ 32,213 available tocommonstockholders

BYLINE BANCORP, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (continued) (unaudited)

As of or For the Three Months Ended As of or For the Six Months Ended

(dollars inthousands,except share Septemberand per share June 30, March 31, December 31, 30, June 30, June 30, June 30, data, ratios 2020 2020 2019 2019 2019 2020 2019annualized,whereapplicable)

Pre-taxpre-provisionreturn on averageassets:

Pre-taxpre-provision $ 28,385 $ 18,471 $ 24,736 $ 27,196 $ 24,677 $ 46,856 $ 46,071 net income

Average total 6,186,974 5,565,952 5,427,046 5,435,762 5,274,820 5,876,463 5,120,122 assets

Pre-taxpre-provisionreturn on 1.85 % 1.33 % 1.81 % 1.98 % 1.88 % 1.60 % 1.81 %averageassets

Adjustedpre-taxpre-provision return onaverageassets:

Adjustedpre-tax $ 28,385 $ 19,186 $ 25,022 $ 28,383 $ 28,223 $ 47,571 $ 51,557 pre-provisionnet income

Average total 6,186,974 5,565,952 5,427,046 5,435,762 5,274,820 5,876,463 5,120,122 assets

Adjustedpre-taxpre-provision 1.85 % 1.39 % 1.83 % 2.07 % 2.15 % 1.63 % 2.03 %return onaverageassets

Non-interestincome to totalrevenues:

Non-interest $ 12,788 $ 9,173 $ 14,516 $ 14,806 $ 14,183 $ 21,961 $ 26,171 income

Total 65,397 61,998 68,430 72,644 68,631 127,395 130,704 revenues

Non-interestincome to 19.56 % 14.79 % 21.21 % 20.38 % 20.67 % 17.24 % 20.02 %totalrevenues

Adjustednon-interestexpense to averageassets:

Adjustednon-interest $ 37,012 $ 42,812 $ 43,408 $ 44,261 $ 40,408 $ 79,824 $ 79,147 expense

Average total 6,186,974 5,565,952 5,427,046 5,435,762 5,274,820 5,876,463 5,120,122 assets

Adjustednon-interestexpense to 2.41 % 3.09 % 3.17 % 3.23 % 3.07 % 2.73 % 3.12 %averageassets

Adjustedefficiency ratio:

Adjustednon-interestexpenseexcluding $ 35,120 $ 40,919 $ 41,406 $ 42,258 $ 38,449 $ 76,039 $ 75,415

amortizationof intangibleassets

Total 65,397 61,998 68,430 72,644 68,631 127,395 130,704 revenues

Adjustedefficiency 53.70 % 66.00 % 60.51 % 58.17 % 56.02 % 59.69 % 57.70 %ratio

Adjustedreturn on averageassets:

Adjusted net $ 9,139 $ 3,482 $ 16,059 $ 16,160 $ 15,915 $ 12,621 $ 29,912 income

Average total 6,186,974 5,565,952 5,427,046 5,435,762 5,274,820 5,876,463 5,120,122 assets

Adjustedreturn on 0.59 % 0.25 % 1.17 % 1.18 % 1.21 % 0.43 % 1.18 %averageassets

Adjustedreturn onaverage stockholders'equity:

Adjusted net $ 9,139 $ 3,482 $ 16,059 $ 16,160 $ 15,915 $ 12,621 $ 29,912 income

Averagestockholders' 775,879 765,427 745,745 729,781 696,928 770,653 678,146 equity

Adjustedreturn onaverage 4.74 % 1.83 % 8.54 % 8.78 % 9.16 % 3.29 % 8.90 %stockholders'equity

Tangiblecommon equity to tangibleassets:

Tangible $ 594,027 $ 573,867 $ 559,422 $ 545,885 $ 525,691 $ 594,027 $ 525,691 common equity

Tangible 6,217,048 5,556,392 5,341,554 5,258,735 5,209,690 6,217,048 5,209,690 assets

Tangiblecommon equity 9.55 % 10.33 % 10.47 % 10.38 % 10.09 % 9.55 % 10.09 %to tangibleassets

Return onaveragetangible commonstockholders'equity:

Tangible netincomeavailable to $ 10,309 $ 4,136 $ 17,101 $ 16,591 $ 14,429 $ 14,445 $ 28,109 common

stockholders

Averagetangiblecommon 588,001 575,573 556,115 538,603 511,254 581,787 499,588 stockholders'equity

Return onaveragetangiblecommon 7.05 % 2.89 % 12.20 % 12.22 % 11.32 % 4.99 % 11.35 %

stockholders'equity

Adjustedreturn onaveragetangible common

stockholders'equity:

Adjustedtangible netincome $ 10,309 $ 4,652 $ 17,308 $ 17,409 $ 17,133 $ 14,961 $ 32,213 available tocommonstockholders

Averagetangiblecommon 588,001 575,573 556,115 538,603 511,254 581,787 499,588 stockholders'equity

Adjustedreturn onaveragetangible 7.05 % 3.25 % 12.35 % 12.82 % 13.44 % 5.17 % 13.00 %common

stockholders'equity

Tangible bookvalue per share:

Tangible $ 594,027 $ 573,867 $ 559,422 $ 545,885 $ 525,691 $ 594,027 $ 525,691 common equity

Common shares 38,388,217 38,383,021 38,256,500 38,169,126 38,115,219 38,388,217 38,115,219 outstanding

Tangible bookvalue per $ 15.47 $ 14.95 $ 14.62 $ 14.30 $ 13.79 $ 15.47 $ 13.79 share

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CONTACT: Investors: Tony Rossi Financial Profiles, Inc. 310-622-8221 BYIR@bylinebank.com

CONTACT: Media: Erin O'Neill Director of Marketing Byline Bank 773-475-2901 eoneill@bylinebank.com