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

07/22 15:15 CDT

First Financial Bancorp Announces Second Quarter 2021 Financial Results CINCINNATI, July 22, 2021

CINCINNATI, July 22, 2021 /PRNewswire/ --

* Earnings per diluted share of $0.52; $0.58 on an adjusted(1) basis * Return on average assets of 1.26%; 1.39% as adjusted(1) * Net interest margin FTE(1) of 3.31% * Provision recapture of $4.2 million * Repurchased 1,308,945 shares during the quarter

First Financial Bancorp. (Nasdaq: FFBC) ("First Financial" or the "Company") announced financial results for the three and six months ended June 30, 2021.

For the three months ended June 30, 2021, the Company reported net income of $50.9 million, or $0.52 per diluted common share. These results compare to net income of $47.3 million, or $0.48 per diluted common share, for the first quarter of 2021 and $37.4 million, or $0.38 per diluted common share, for the second quarter of 2020. For the six months ended June 30, 2021, First Financial had earnings per diluted common share of $1.01 compared to $0.67 for the same period in 2020.

Return on average assets for the second quarter of 2021 was 1.26% while return on average tangible common equity was 16.31%(1). These compare to returns on average assets of 1.20% and 0.96%, and returns on average tangible common equity of 15.24%(1) and 12.90%(1), in the first quarter of 2021 and the second quarter of 2020, respectively.

Second quarter 2021 highlights include:

* After adjustments(1) for certain nonrecurring items: * Net income of $0.58 per diluted common share * 1.39% return on average assets * 18.03% return on average tangible common equity

* Net interest margin of 3.31% on a fully tax-equivalent basis(1) in line with expectations * 9 basis point reduction from linked quarter driven by lower yields on earning assets and additional days during the second quarter

* Noninterest income of $43.0 million, or $43.1 million as adjusted(1) * Record foreign exchange income of $12.0 million; increased $1.3 million, or 11.9%, compared to linked quarter * Record wealth management fees of $6.2 million; increased $0.6 million, or 10.4%, compared to the linked quarter

* Noninterest expenses of $99.6 million, or $91.8 million as adjusted(1) * Adjustments(1) include: * $3.8 million of legal settlement costs * $2.8 million of branch consolidation costs * $1.2 million of tax credit investment write-downs

* Efficiency ratio of 63.5%; 58.4% as adjusted(1)

* Loan balances declined during the quarter driven by $288.8 million of PPP forgiveness and elevated prepayments

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

* Average transactional deposit balances grew $469.6 million compared to the linked quarter; 17.8% on an annualized basis * Total Allowance for Credit Losses of $173.1 million; Total quarterly provision recapture of $4.2 million * Loans and leases - ACL of $159.6 million, 1.68% of total loans; 1.75% of loans excluding PPP * Unfunded Commitments - ACL of $13.6 million * Provision recapture driven by improvements in economic conditions and classified asset balances, coupled with lower net charge-offs

* Strong capital ratios * Total capital of 15.31% * Tier 1 common equity of 11.78% * Tangible common equity of 8.37%(1); 8.61%(1) excluding PPP loans * Tangible book value per share of $13.08(1); $0.30 increase compared to linked quarter * Repurchased 1,308,945 shares during second quarter; 2,149,060 shares repurchased in 2021

Archie Brown, President and Chief Executive Officer, commented, "We are very pleased to announce second quarter results that are highlighted by robust earnings, higher fee income, lower credit costs and improving credit trends."

Mr. Brown continued, "Our core quarterly financial metrics reflected the strong quarter with an adjusted(1) earnings per share of $0.58, adjusted(1) return on assets of 1.39%, and an adjusted(1) efficiency ratio of 58.4%. The quarterly performance was bolstered by higher fee revenue in interchange, and record revenue in Wealth Management and Bannockburn. Additionally, provision recapture during the period positively impacted our results, driven by improved credit quality trends, which included declines in net charge-offs and classified asset balances. We are optimistic about the economic environment and expect further reductions in credit costs in the coming periods."

Mr. Brown added, "We were pleased with a 23% increase in loan originations for the quarter, driven primarily by our core commercial markets, in addition to consumer and mortgage banking. Loan payoffs accelerated during the quarter in almost all commercial banking areas, with larger payoff amounts in Commercial Finance and ICRE driving an overall reduction in core loan balances for the quarter. Given the state of our loan pipeline, we expect originations to remain strong in the second half of the year, however we also anticipate higher payoffs to continue due to the amount of liquidity in the market. Average transactional deposits increased 18% on an annualized basis, as clients continued to build liquidity from recent government stimulus actions, however we believe these balances may have peaked as we began to experience some outflows late in the quarter. Our capital ratios remained strong and in excess of both internal and external targets. We also remained active in our share buyback program, repurchasing over 1 million shares during the quarter. When combined with the common dividend, the share repurchases approximate a return to shareholders of 98% of adjusted(1) quarterly earnings. We anticipate further share buyback activity in the third quarter, absent higher priority capital deployment alternatives."

Mr. Brown concluded, "Throughout the summer, the number of associates working in our offices has increased steadily in anticipation of a broader return, and we are very much looking forward to welcoming all of our associates back in the beginning of August. We have learned a great deal from the remote environment during the last 16 months and are excited to incorporate the best practices derived from that experience into our culture moving forward, including greater associate flexibility."

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

Teleconference / Webcast Information

First Financial's executive management will host a conference call to discuss the Company's financial and operating results on Friday, July 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 10158382. The webcast will be archived on the Investor Relations section of the Company's website for 12 months.

Press Release and Additional Information on Website

This 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 Measures

This 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 June 30, 2021, the Company had $16.0 billion in assets, $9.5 billion in loans, $12.5 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 $3.2 billion in assets under management as of June 30, 2021. The Company operated 139 full service banking centers as of June 30, 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, Six months ended,

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

2021 2021 2020 2020 2020 2021 2020

RESULTS OF OPERATIONS

Net income $50,888 $47,315 $48,312 $41,477 $37,393 $98,203 $66,021

Net earnings per share - basic $0.53 $0.49 $0.50 $0.43 $0.38 $1.02 $0.68

Net earnings per share - diluted $0.52 $0.48 $0.49 $0.42 $0.38 $1.01 $0.67

Dividends declared per share $0.23 $0.23 $0.23 $0.23 $0.23 $0.46 $0.46



KEY FINANCIAL RATIOS

Return on average assets 1.26 %1.20 %1.20 %1.04 %0.96 %1.23 %0.88 %

Return on average shareholders' equity 9.02 %8.44 %8.52 %7.40 %6.88 %8.73 %6.04 %

Return on average tangible shareholders' equity ^(1) 16.31 %15.24 %15.50 %13.61 %12.90 %15.78 %11.29 %



Net interest margin 3.27 %3.35 %3.45 %3.32 %3.38 %3.31 %3.54 %

Net interest margin (fully tax equivalent) ^(1)(2) 3.31 %3.40 %3.49 %3.36 %3.44 %3.35 %3.60 %



Ending shareholders' equity as a percent of ending assets 14.15 %13.97 %14.29 %14.11 %13.99 %14.15 %13.99 %

Ending tangible shareholders' equity as a percent of:

Ending tangible assets ^(1) 8.37 %8.22 %8.47 %8.25 %8.09 %8.37 %8.09 %

Risk-weighted assets ^(1) 11.12 %11.02 %11.29 %11.07 %10.89 %11.12 %10.89 %



Average shareholders' equity as a percent of average assets13.96 %14.17 %14.07 %14.08 %13.91 %14.06 %14.54 %

Average tangible shareholders' equity as a percent of

average tangible assets ^(1) 8.23 %8.38 %8.26 %8.18 %7.94 %8.30 %8.34 %



Book value per share $23.59 $23.16 $23.28 $22.94 $22.66 $23.59 $22.66

Tangible book value per share ^(1) $13.08 $12.78 $12.93 $12.56 $12.26 $13.08 $12.26



Common equity tier 1 ratio^ (3) 11.78 %11.81 %11.82 %11.63 %11.49 %11.78 %11.49 %

Tier 1 ratio ^(3) 12.16 %12.19 %12.20 %12.02 %11.87 %12.16 %11.87 %

Total capital ratio ^(3) 15.31 %15.41 %15.55 %15.37 %15.19 %15.31 %15.19 %

Leverage ratio ^(3) 9.14 %9.34 %9.55 %9.55 %8.98 %9.14 %8.98 %



AVERAGE BALANCE SHEET ITEMS

Loans ^(4) $9,831,965 $9,951,855 $10,127,881 $10,253,392 $10,002,379 $9,891,579 $9,611,511

Investment securities 4,130,207 3,782,993 3,403,839 3,162,832 3,164,243 3,957,559 3,139,983

Interest-bearing deposits with other banks 45,593 46,912 143,884 40,277 91,990 46,249 65,661

Total earning assets $14,007,765 $13,781,760 $13,675,604 $13,456,501 $13,258,612 $13,895,387 $12,817,155

Total assets $16,215,469 $16,042,654 $16,030,986 $15,842,010 $15,710,204 $16,129,539 $15,117,313

Noninterest-bearing deposits $4,003,626 $3,840,046 $3,720,417 $3,535,432 $3,335,866 $3,922,288 $2,989,553

Interest-bearing deposits 8,707,553 8,531,822 8,204,306 8,027,082 8,395,229 8,620,173 7,993,010

Total deposits $12,711,179 $12,371,868 $11,924,723 $11,562,514 $11,731,095 $12,542,461 $10,982,563

Borrowings $749,114 $886,379 $1,307,461 $1,519,748 $1,272,819 $817,367 $1,504,293

Shareholders' equity $2,263,687 $2,272,749 $2,256,062 $2,230,422 $2,185,865 $2,268,193 $2,197,799



CREDIT QUALITY RATIOS

Allowance to ending loans 1.68 %1.71 %1.77 %1.65 %1.56 %1.68 %1.56 %

Allowance to nonaccrual loans 184.77 %199.33 %217.55 %216.28 %233.74 %184.77 %233.74 %

Allowance to nonperforming loans 162.12 %175.44 %199.97 %196.69 %208.06 %162.12 %208.06 %

Nonperforming loans to total loans 1.03 %0.97 %0.89 %0.84 %0.75 %1.03 %0.75 %

Nonperforming assets to ending loans, plus OREO 1.04 %0.98 %0.90 %0.86 %0.77 %1.04 %0.77 %

Nonperforming assets to total assets 0.62 %0.60 %0.56 %0.55 %0.49 %0.62 %0.49 %

Classified assets to total assets 1.14 %1.22 %0.89 %0.84 %0.79 %1.14 %0.79 %

Net charge-offs to average loans (annualized) 0.23 %0.38 %0.26 %0.21 %0.12 %0.30 %0.05 %

^(1) Non-GAAP measure. For details on the calculation of these non-GAAPfinancial measures and a reconciliation to the GAAP financial measure, see thesections titled "Use of Non-GAAP Financial Measures" in this release and"Appendix: Non-GAAP to GAAP Reconciliation" in the accompanying slidepresentation.

^(2) 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.

^(3) June 30, 2021 regulatory capital ratios are preliminary.

^(4) Includes loans held for sale.

FIRST FINANCIAL BANCORP.

CONSOLIDATED STATEMENTS OF INCOME

(Dollars in thousands, except per share data)

(Unaudited)



Three months ended, Six months ended,

June 30, June 30,

2021 2020 % Change 2021 2020 % Change

Interest income

Loans and leases, including fees $97,494 $105,900 (7.9) %$196,425 $221,675 (11.4) %

Investment securities

Taxable 19,524 18,476 5.7 %38,131 37,481 1.7 %

Tax-exempt 4,871 4,937 (1.3) %9,914 9,519 4.1 %

Total investment securities interest 24,395 23,413 4.2 %48,045 47,000 2.2 %

Other earning assets 25 47 (46.8) %53 189 (72.0) %

Total interest income 121,914 129,360 (5.8) %244,523 268,864 (9.1) %



Interest expense

Deposits 3,693 11,751 (68.6) %8,026 28,116 (71.5) %

Short-term borrowings 53 1,274 (95.8) %120 6,361 (98.1) %

Long-term borrowings 4,142 4,759 (13.0) %8,475 8,529 (0.6) %

Total interest expense 7,888 17,784 (55.6) %16,621 43,006 (61.4) %

Net interest income 114,026 111,576 2.2 %227,902 225,858 0.9 %

Provision for credit losses-loans and leases (4,756) 17,859 (126.6)%(1,306) 41,739 (103.1)%

Provision for credit losses-unfunded commitments 517 2,370 (78.2) %1,055 3,938 (73.2) %

Net interest income after provision for credit losses118,265 91,347 29.5 %228,153 180,181 26.6 %



Noninterest income

Service charges on deposit accounts 7,537 6,001 25.6 %14,683 14,436 1.7 %

Trust and wealth management fees 6,216 5,254 18.3 %11,846 10,951 8.2 %

Bankcard income 3,732 2,844 31.2 %6,860 5,542 23.8 %

Client derivative fees 1,795 2,984 (39.8) %3,351 6,089 (45.0) %

Foreign exchange income 12,037 6,576 83.0 %22,794 16,542 37.8 %

Net gains from sales of loans 8,489 16,662 (49.1) %17,943 19,493 (8.0) %

Net gains (losses) on sale of investment securities (265) 2 N/M (431) (57) N/M

Unrealized gain (loss) on equity securities 161 150 7.3 %273 52 N/M

Other 3,285 2,252 45.9 %5,990 5,061 18.4 %

Total noninterest income 42,987 42,725 0.6 %83,309 78,109 6.7 %



Noninterest expenses

Salaries and employee benefits 60,784 55,925 8.7 %122,037 110,747 10.2 %

Net occupancy 5,535 5,378 2.9 %11,239 11,482 (2.1) %

Furniture and equipment 3,371 3,681 (8.4) %7,340 7,734 (5.1) %

Data processing 7,864 7,019 12.0 %15,151 13,408 13.0 %

Marketing 2,035 1,339 52.0 %3,396 2,559 32.7 %

Communication 746 907 (17.8) %1,584 1,797 (11.9) %

Professional services 2,029 2,205 (8.0) %3,479 4,480 (22.3) %

State intangible tax 1,201 1,514 (20.7) %2,403 3,030 (20.7) %

FDIC assessments 1,362 1,290 5.6 %2,711 2,695 0.6 %

Intangible amortization 2,480 2,791 (11.1) %4,959 5,583 (11.2) %

Other 12,236 6,640 84.3 %17,850 14,840 20.3 %

Total noninterest expenses 99,643 88,689 12.4 %192,149 178,355 7.7 %

Income before income taxes 61,609 45,383 35.8 %119,313 79,935 49.3 %

Income tax expense 10,721 7,990 34.2 %21,110 13,914 51.7 %

Net income $50,888 $37,393 36.1 %$98,203 $66,021 48.7 %



ADDITIONAL DATA

Net earnings per share - basic $0.53 $0.38 $1.02 $0.68

Net earnings per share - diluted $0.52 $0.38 $1.01 $0.67

Dividends declared per share $0.23 $0.23 $0.46 $0.46



Return on average assets 1.26 %0.96 % 1.23 %0.88 %

Return on average shareholders' equity 9.02 %6.88 % 8.73 %6.04 %



Interest income $121,914 $129,360 (5.8) %$244,523 $268,864 (9.1) %

Tax equivalent adjustment 1,619 1,664 (2.7) %3,271 3,288 (0.5) %

Interest income - tax equivalent 123,533 131,024 (5.7) %247,794 272,152 (9.0) %

Interest expense 7,888 17,784 (55.6) %16,621 43,006 (61.4) %

Net interest income - tax equivalent $115,645 $113,240 2.1 %$231,173 $229,146 0.9 %



Net interest margin 3.27 %3.38 % 3.31 %3.54 %

Net interest margin (fully tax equivalent) ^(1) 3.31 %3.44 % 3.35 %3.60 %



Full-time equivalent employees 2,053 2,076



(1) The tax equivalent adjustment to net interest income recognizes the income tax savings when comparing taxable and tax-exempt assets and assumes 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 QUARTERLY STATEMENTS OF INCOME

(Dollars in thousands, except per share data)

(Unaudited)



2021

Second First Year to % Change

Quarter Quarter Date Linked Qtr.

Interest income

Loans and leases, including fees $97,494 $98,931 $196,425 (1.5) %

Investment securities

Taxable 19,524 18,607 38,131 4.9 %

Tax-exempt 4,871 5,043 9,914 (3.4) %

Total investment securities interest 24,395 23,650 48,045 3.2 %

Other earning assets 25 28 53 (10.7) %

Total interest income 121,914 122,609 244,523 (0.6) %



Interest expense

Deposits 3,693 4,333 8,026 (14.8) %

Short-term borrowings 53 67 120 (20.9) %

Long-term borrowings 4,142 4,333 8,475 (4.4) %

Total interest expense 7,888 8,733 16,621 (9.7) %

Net interest income 114,026 113,876 227,902 0.1 %

Provision for credit losses-loans and leases (4,756) 3,450 (1,306) (237.9) %

Provision for credit losses-unfunded commitments 517 538 1,055 (3.9) %

Net interest income after provision for credit losses118,265 109,888 228,153 7.6 %



Noninterest income

Service charges on deposit accounts 7,537 7,146 14,683 5.5 %

Trust and wealth management fees 6,216 5,630 11,846 10.4 %

Bankcard income 3,732 3,128 6,860 19.3 %

Client derivative fees 1,795 1,556 3,351 15.4 %

Foreign exchange income 12,037 10,757 22,794 11.9 %

Net gains from sales of loans 8,489 9,454 17,943 (10.2) %

Net gains (losses) on sale of investment securities (265) (166) (431) 59.6 %

Unrealized gain (loss) on equity securities 161 112 273 43.8 %

Other 3,285 2,705 5,990 21.4 %

Total noninterest income 42,987 40,322 83,309 6.6 %



Noninterest expenses

Salaries and employee benefits 60,784 61,253 122,037 (0.8) %

Net occupancy 5,535 5,704 11,239 (3.0) %

Furniture and equipment 3,371 3,969 7,340 (15.1) %

Data processing 7,864 7,287 15,151 7.9 %

Marketing 2,035 1,361 3,396 49.5 %

Communication 746 838 1,584 (11.0) %

Professional services 2,029 1,450 3,479 39.9 %

State intangible tax 1,201 1,202 2,403 (0.1) %

FDIC assessments 1,362 1,349 2,711 1.0 %

Intangible amortization 2,480 2,479 4,959 0.0 %

Other 12,236 5,614 17,850 118.0 %

Total noninterest expenses 99,643 92,506 192,149 7.7 %

Income before income taxes 61,609 57,704 119,313 6.8 %

Income tax expense 10,721 10,389 21,110 3.2 %

Net income $50,888 $47,315 $98,203 7.6 %



ADDITIONAL DATA

Net earnings per share - basic $0.53 $0.49 $1.02

Net earnings per share - diluted $0.52 $0.48 $1.01

Dividends declared per share $0.23 $0.23 $0.46



Return on average assets 1.26 %1.20 %1.23 %

Return on average shareholders' equity 9.02 %8.44 %8.73 %



Interest income $121,914 $122,609 $244,523 (0.6) %

Tax equivalent adjustment 1,619 1,652 3,271 (2.0) %

Interest income - tax equivalent 123,533 124,261 247,794 (0.6) %

Interest expense 7,888 8,733 16,621 (9.7) %

Net interest income - tax equivalent $115,645 $115,528 $231,173 0.1 %



Net interest margin 3.27 %3.35 %3.31 %

Net interest margin (fully tax equivalent)^ (1) 3.31 %3.40 %3.35 %



Full-time equivalent employees 2,053 2,063



(1) The tax equivalent adjustment to net interest income recognizes the income tax savings when comparing taxable and tax-exempt assets and assumes a 21% tax rate. Management believes that it is a standard practice in the banking industry to present net interest income on a fullytax 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 QUARTERLY STATEMENTS OF INCOME

(Dollars in thousands, except per share data)

(Unaudited)



2020

Fourth Third Second First Full

Quarter Quarter Quarter Quarter Year

Interest income

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

Investment securities

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

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

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

Other earning assets 55 31 47 142 275

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



Interest expense

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

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

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

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

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

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

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

Net interest income after provision for credit losses106,965 98,806 91,347 88,834 385,952



Noninterest income

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

Trust and wealth management fees 5,395 4,940 5,254 5,697 21,286

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

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

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

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

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

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

Other 4,398 2,732 2,252 2,809 12,191

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



Noninterest expenses

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

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

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

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

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

Communication 840 855 907 890 3,492

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

Debt extinguishment 7,257 0 0 0 7,257

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

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

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

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

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

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

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

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



ADDITIONAL DATA

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

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

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



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

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



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

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

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

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

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



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

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



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



^(1) The tax equivalent adjustment to net interest income recognizes the incometax savings when comparing taxable and tax-exempt assets and assumes 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)



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

2021 2021 2020 2020 2020 Linked Qtr.Comp Qtr.

ASSETS

Cash and due from banks $206,918 $210,191 $231,054 $207,128 $283,639 (1.6) % (27.0)%

Interest-bearing deposits with other banks 38,610 19,180 20,305 38,806 38,845 101.3 % (0.6) %

Investment securities available-for-sale 3,955,839 3,753,763 3,424,580 3,004,963 2,897,413 5.4 % 36.5 %

Investment securities held-to-maturity 112,456 121,945 131,687 118,072 127,347 (7.8) % (11.7)%

Other investments 129,432 131,814 133,198 118,292 132,366 (1.8) % (2.2) %

Loans held for sale 31,546 34,590 41,103 69,008 43,950 (8.8) % (28.2)%

Loans and leases

Commercial and industrial 2,701,203 3,044,825 3,007,509 3,292,313 3,322,374 (11.3) % (18.7)%

Lease financing 68,229 66,574 72,987 74,742 80,087 2.5 % (14.8)%

Construction real estate 630,329 642,709 636,096 575,648 506,085 (1.9) % 24.6 %

Commercial real estate 4,332,561 4,396,582 4,307,858 4,347,125 4,343,702 (1.5) % (0.3) %

Residential real estate 932,112 946,522 1,003,086 1,027,702 1,043,745 (1.5) % (10.7)%

Home equity 711,756 709,667 743,099 754,743 764,171 0.3 % (6.9) %

Installment 89,143 82,421 81,850 84,629 79,150 8.2 % 12.6 %

Credit card 46,177 44,669 48,485 43,907 42,397 3.4 % 8.9 %

Total loans 9,511,510 9,933,969 9,900,970 10,200,809 10,181,711 (4.3) % (6.6) %

Less:

Allowance for credit losses 159,590 169,923 175,679 168,544 158,661 (6.1) % 0.6 %

Net loans 9,351,920 9,764,046 9,725,291 10,032,265 10,023,050 (4.2) % (6.7) %

Premises and equipment 192,238 204,537 207,211 209,474 211,164 (6.0) % (9.0) %

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

Other intangibles 59,391 61,984 64,552 67,419 70,325 (4.2) % (15.5)%

Accrued interest and other assets 1,021,798 935,250 1,056,382 1,122,449 1,105,020 9.3 % (7.5) %

Total Assets $16,037,919$16,175,071$15,973,134$15,925,647$15,870,890(0.8) % 1.1 %



LIABILITIES

Deposits

Interest-bearing demand $2,963,151 $2,914,761 $2,914,787 $2,632,467 $2,657,841 1.7 % 11.5 %

Savings 4,093,229 4,006,181 3,680,774 3,446,678 3,287,314 2.2 % 24.5 %

Time 1,548,109 1,731,757 1,872,733 1,935,392 2,241,212 (10.6) % (30.9)%

Total interest-bearing deposits 8,604,489 8,652,699 8,468,294 8,014,537 8,186,367 (0.6) % 5.1 %

Noninterest-bearing 3,901,691 3,995,370 3,763,709 3,552,893 3,515,048 (2.3) % 11.0 %

Total deposits 12,506,180 12,648,069 12,232,003 11,567,430 11,701,415 (1.1) % 6.9 %

Federal funds purchased and securities sold

under agreements to repurchase 255,791 181,387 166,594 247,658 154,347 41.0 % 65.7 %

FHLB short-term borrowings 217,000 0 0 0 0 100.0 % 100.0 %

Total short-term borrowings 472,791 181,387 166,594 247,658 154,347 160.7 % 206.3 %

Long-term debt 313,039 583,722 776,202 1,341,164 1,285,767 (46.4) % (75.7)%

Total borrowed funds 785,830 765,109 942,796 1,588,822 1,440,114 2.7 % (45.4)%

Accrued interest and other liabilities 476,402 502,951 516,265 521,580 508,342 (5.3) % (6.3) %

Total Liabilities 13,768,412 13,916,129 13,691,064 13,677,832 13,649,871 (1.1) % 0.9 %



SHAREHOLDERS' EQUITY

Common stock 1,635,470 1,633,137 1,638,947 1,637,489 1,635,070 0.1 % 0.0 %

Retained earnings 773,857 745,220 720,429 694,484 675,532 3.8 % 14.6 %

Accumulated other comprehensive income (loss)30,735 18,101 48,664 42,266 36,431 69.8 % (15.6)%

Treasury stock, at cost (170,555) (137,516) (125,970) (126,424) (126,014) 24.0 % 35.3 %

Total Shareholders' Equity 2,269,507 2,258,942 2,282,070 2,247,815 2,221,019 0.5 % 2.2 %

Total Liabilities and Shareholders' Equity $16,037,919$16,175,071$15,973,134$15,925,647$15,870,890(0.8) % 1.1 %





FIRST FINANCIAL BANCORP.

AVERAGE CONSOLIDATED STATEMENTS OF CONDITION

(Dollars in thousands)

(Unaudited)



Quarterly Averages Year-to-Date Averages

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

2021 2021 2020 2020 2020 2021 2020

ASSETS

Cash and due from banks $237,964 $232,275 $228,427 $233,216 $284,726 $235,135 $260,211

Interest-bearing deposits with other banks 45,593 46,912 143,884 40,277 91,990 46,249 65,661

Investment securities 4,130,207 3,782,993 3,403,839 3,162,832 3,164,243 3,957,559 3,139,983

Loans held for sale 28,348 29,689 42,402 45,186 36,592 29,015 24,883

Loans and leases

Commercial and industrial 2,953,185 3,029,716 3,182,749 3,299,259 3,058,677 2,991,239 2,754,785

Lease financing 66,124 70,508 74,107 78,500 81,218 68,304 83,500

Construction real estate 630,351 647,655 608,401 536,870 495,407 638,955 498,439

Commercial real estate 4,372,679 4,339,349 4,313,408 4,364,708 4,381,647 4,356,106 4,295,496

Residential real estate 940,600 980,718 1,022,701 1,041,250 1,052,996 960,548 1,054,226

Home equity 707,409 726,134 752,425 759,994 772,424 716,720 772,753

Installment 84,768 81,377 83,509 82,016 79,016 83,082 80,125

Credit card 48,501 46,709 48,179 45,609 44,402 47,610 47,304

Total loans 9,803,617 9,922,166 10,085,479 10,208,206 9,965,787 9,862,564 9,586,628

Less:

Allowance for credit losses 169,979 177,863 172,201 165,270 155,454 173,899 138,290

Net loans 9,633,638 9,744,303 9,913,278 10,042,936 9,810,333 9,688,665 9,448,338

Premises and equipment 200,558 206,628 208,800 211,454 213,903 203,576 214,724

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

Other intangibles 60,929 63,529 66,195 69,169 72,086 62,222 73,550

Accrued interest and other assets 940,461 998,554 1,086,390 1,099,169 1,098,560 969,347 952,192

Total Assets $16,215,469$16,042,654$16,030,986$15,842,010$15,710,204$16,129,539$15,117,313



LIABILITIES

Deposits

Interest-bearing demand $2,973,930 $2,948,682 $2,812,748 $2,668,635 $2,602,917 $2,961,376 $2,510,555

Savings 4,096,077 3,815,314 3,547,179 3,342,514 3,173,274 3,956,471 3,074,896

Time 1,637,546 1,767,826 1,844,379 2,015,933 2,619,038 1,702,326 2,407,559

Total interest-bearing deposits 8,707,553 8,531,822 8,204,306 8,027,082 8,395,229 8,620,173 7,993,010

Noninterest-bearing 4,003,626 3,840,046 3,720,417 3,535,432 3,335,866 3,922,288 2,989,553

Total deposits 12,711,179 12,371,868 11,924,723 11,562,514 11,731,095 12,542,461 10,982,563

Federal funds purchased and securities sold

under agreements to repurchase 194,478 184,483 136,795 150,088 145,291 189,508 154,692

FHLB short-term borrowings 40,846 67,222 7,937 30,868 548,183 53,961 868,974

Total short-term borrowings 235,324 251,705 144,732 180,956 693,474 243,469 1,023,666

Long-term debt 513,790 634,674 1,162,729 1,338,792 579,345 573,898 480,627

Total borrowed funds 749,114 886,379 1,307,461 1,519,748 1,272,819 817,367 1,504,293

Accrued interest and other liabilities 491,489 511,658 542,740 529,326 520,425 501,518 432,658

Total Liabilities 13,951,782 13,769,905 13,774,924 13,611,588 13,524,339 13,861,346 12,919,514



SHAREHOLDERS' EQUITY

Common stock 1,633,950 1,636,884 1,638,032 1,636,107 1,634,405 1,635,409 1,636,628

Retained earnings 754,456 726,351 703,257 679,980 658,312 740,481 659,210

Accumulated other comprehensive loss 25,832 42,253 40,960 40,697 19,888 33,997 25,544

Treasury stock, at cost (150,551) (132,739) (126,187) (126,362) (126,740) (141,694) (123,583)

Total Shareholders' Equity 2,263,687 2,272,749 2,256,062 2,230,422 2,185,865 2,268,193 2,197,799

Total Liabilities and Shareholders' Equity$16,215,469$16,042,654$16,030,986$15,842,010$15,710,204$16,129,539$15,117,313





FIRST FINANCIAL BANCORP.

NET INTEREST MARGIN RATE/VOLUME ANALYSIS

(Dollars in thousands)

(Unaudited)



Quarterly Averages Year-to-Date Averages

June 30, 2021 March 31, 2021 June 30, 2020 June 30, 2021 June 30, 2020

Balance Yield Balance Yield Balance Yield Balance Yield Balance Yield

Earning assets

Investments:

Investment securities $4,130,207 2.37%$3,782,993 2.54%$3,164,243 2.97 % $3,957,559 2.45 % $3,139,983 3.02 %

Interest-bearing deposits with other banks45,593 0.22%46,912 0.24%91,990 0.20 % 46,249 0.23 % 65,661 0.58 %

Gross loans ^(1) 9,831,965 3.98%9,951,855 4.03%10,002,379 4.25 % 9,891,579 4.00 % 9,611,511 4.65 %

Total earning assets 14,007,765 3.49%13,781,760 3.61%13,258,612 3.91 % 13,895,387 3.55 % 12,817,155 4.23 %



Nonearning assets

Allowance for credit losses (169,979) (177,863) (155,454) (173,899) (138,290)

Cash and due from banks 237,964 232,275 284,726 235,135 260,211

Accrued interest and other assets 2,139,719 2,206,482 2,322,320 2,172,916 2,178,237

Total assets $16,215,469 $16,042,654 $15,710,204 $16,129,539 $15,117,313



Interest-bearing liabilities

Deposits:

Interest-bearing demand $2,973,930 0.07%$2,948,682 0.07%$2,602,917 0.11 % $2,961,376 0.07 % $2,510,555 0.27 %

Savings 4,096,077 0.11%3,815,314 0.13%3,173,274 0.17 % 3,956,471 0.12 % 3,074,896 0.31 %

Time 1,637,546 0.51%1,767,826 0.60%2,619,038 1.49 % 1,702,326 0.56 % 2,407,559 1.68 %

Total interest-bearing deposits 8,707,553 0.17%8,531,822 0.21%8,395,229 0.56 % 8,620,173 0.19 % 7,993,010 0.71 %

Borrowed funds

Short-term borrowings 235,324 0.09%251,705 0.11%693,474 0.74 % 243,469 0.10 % 1,023,666 1.25 %

Long-term debt 513,790 3.23%634,674 2.77%579,345 3.29 % 573,898 2.98 % 480,627 3.58 %

Total borrowed funds 749,114 2.25%886,379 2.01%1,272,819 1.90 % 817,367 2.12 % 1,504,293 2.00 %

Total interest-bearing liabilities 9,456,667 0.33%9,418,201 0.38%9,668,048 0.74 % 9,437,540 0.36 % 9,497,303 0.91 %



Noninterest-bearing liabilities

Noninterest-bearing demand deposits 4,003,626 3,840,046 3,335,866 3,922,288 2,989,553

Other liabilities 491,489 511,658 520,425 501,518 432,658

Shareholders' equity 2,263,687 2,272,749 2,185,865 2,268,193 2,197,799

Total liabilities & shareholders' equity $16,215,469 $16,042,654 $15,710,204 $16,129,539 $15,117,313



Net interest income $114,026 $113,876 $111,576 $227,902 $225,858

Net interest spread 3.16% 3.23% 3.17 % 3.19 % 3.32 %

Net interest margin 3.27% 3.35% 3.38 % 3.31 % 3.54 %



Tax equivalent adjustment 0.04% 0.05% 0.06 % 0.04 % 0.06 %

Net interest margin (fully tax equivalent) 3.31% 3.40% 3.44 % 3.35 % 3.60 %





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

FIRST FINANCIAL BANCORP.

NET INTEREST MARGIN RATE/VOLUME ANALYSIS ^(1)

(Dollars in thousands)

(Unaudited)





Linked Qtr. Income Variance Comparable Qtr. Income VarianceYear-to-Date Income Variance

Rate Volume Total Rate Volume Total Rate Volume Total

Earning assets

Investment securities $(1,551)$2,296$745 $(4,723)$5,705$982 $(8,880) $9,925 $1,045

Interest-bearing deposits with other banks(3) 0 (3) 3 (25) (22) (114) (22) (136)

Gross loans ^(2) (1,333) (104) (1,437)(6,716) (1,690)(8,406) (30,812) 5,562 (25,250)

Total earning assets (2,887) 2,192 (695) (11,436) 3,990 (7,446) (39,806) 15,465 (24,341)



Interest-bearing liabilities

Total interest-bearing deposits $(754) $114 $(640)$(8,190)$132 $(8,058)$(20,674)$584 $(20,090)

Borrowed funds

Short-term borrowings (11) (3) (14) (1,118) (103) (1,221) (5,856) (385) (6,241)

Long-term debt 727 (918) (191) (89) (528) (617) (1,431) 1,377 (54)

Total borrowed funds 716 (921) (205) (1,207) (631) (1,838) (7,287) 992 (6,295)

Total interest-bearing liabilities (38) (807) (845) (9,397) (499) (9,896) (27,961) 1,576 (26,385)

Net interest income ^(1) $(2,849)$2,999$150 $(2,039)$4,489$2,450 $(11,845)$13,889$2,044





^(1) Not tax equivalent.

^(2) Loans held for sale and nonaccrual loans are included in gross loans.

FIRST FINANCIAL BANCORP.

CREDIT QUALITY

(Dollars in thousands)

(Unaudited)

Six months ended

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

2021 2021 2020 2020 2020 2021 2020

ALLOWANCE FOR CREDIT LOSS ACTIVITY

Balance at beginning of period $169,923 $175,679 $168,544 $158,661 $143,885 $175,679 $57,650

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

Provision for credit losses (4,756) 3,450 13,758 15,299 17,859 (1,306) 41,739

Gross charge-offs

Commercial and industrial 3,729 7,910 1,505 1,467 1,282 11,639 2,373

Lease financing 0 0 0 852 0 0 0

Construction real estate 0 2 0 0 0 2 0

Commercial real estate 2,041 1,250 6,270 3,789 2,037 3,291 2,041

Residential real estate 46 1 203 22 148 47 263

Home equity 240 611 386 460 428 851 695

Installment 77 36 21 59 7 113 68

Credit card 179 222 169 171 234 401 545

Total gross charge-offs 6,312 10,032 8,554 6,820 4,136 16,344 5,985

Recoveries

Commercial and industrial 205 337 367 265 275 542 2,275

Lease financing 0 0 (6) 6 0 0 0

Construction real estate 3 0 3 0 14 3 14

Commercial real estate 75 195 844 760 424 270 658

Residential real estate 54 44 145 91 93 98 145

Home equity 317 177 428 209 156 494 495

Installment 37 34 65 35 27 71 58

Credit card 44 39 85 38 64 83 107

Total recoveries 735 826 1,931 1,404 1,053 1,561 3,752

Total net charge-offs 5,577 9,206 6,623 5,416 3,083 14,783 2,233

Ending allowance for credit losses $159,590 $169,923 $175,679 $168,544 $158,661 $159,590 $158,661



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

Commercial and industrial 0.48 %1.01 %0.14 %0.14 %0.13 %0.75 %0.01 %

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

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

Commercial real estate 0.18 %0.10 %0.50 %0.28 %0.15 %0.14 %0.06 %

Residential real estate 0.00 %(0.02) %0.02 %(0.03) %0.02 %(0.01) %0.02 %

Home equity (0.04) %0.24 %(0.02) %0.13 %0.14 %0.10 %0.05 %

Installment 0.19 %0.01 %(0.21) %0.12 %(0.10) %0.10 %0.03 %

Credit card 1.12 %1.59 %0.69 %1.16 %1.54 %1.35 %1.86 %

Total net charge-offs 0.23 %0.38 %0.26 %0.21 %0.12 %0.30 %0.05 %



COMPONENTS OF NONPERFORMING LOANS, NONPERFORMING ASSETS, AND UNDERPERFORMING ASSETS

Nonaccrual loans ^(1)

Commercial and industrial $27,426 $24,941 $29,230 $34,686 $33,906 $27,426 $33,906

Lease financing 16 0 0 1,092 1,353 16 1,353

Construction real estate 0 0 0 0 0 0 0

Commercial real estate 45,957 44,514 34,682 24,521 14,002 45,957 14,002

Residential real estate 9,480 11,359 11,601 12,104 12,813 9,480 12,813

Home equity 3,376 4,286 5,076 5,374 5,604 3,376 5,604

Installment 115 146 163 153 201 115 201

Nonaccrual loans 86,370 85,246 80,752 77,930 67,879 86,370 67,879

Accruing troubled debt restructurings (TDRs) 12,070 11,608 7,099 7,759 8,377 12,070 8,377

Total nonperforming loans 98,440 96,854 87,851 85,689 76,256 98,440 76,256

Other real estate owned (OREO) 340 854 1,287 1,643 1,872 340 1,872

Total nonperforming assets 98,780 97,708 89,138 87,332 78,128 98,780 78,128

Accruing loans past due 90 days or more 155 92 169 79 124 155 124

Total underperforming assets $98,935 $97,800 $89,307 $87,411 $78,252 $98,935 $78,252

Total classified assets $182,516 $196,782 $142,021 $134,002 $125,543 $182,516 $125,543



CREDIT QUALITY RATIOS

Allowance for credit losses to

Nonaccrual loans 184.77 %199.33 %217.55 %216.28 %233.74 %184.77 %233.74 %

Nonperforming loans 162.12 %175.44 %199.97 %196.69 %208.06 %162.12 %208.06 %

Total ending loans 1.68 %1.71 %1.77 %1.65 %1.56 %1.68 %1.56 %

Nonperforming loans to total loans 1.03 %0.97 %0.89 %0.84 %0.75 %1.03 %0.75 %

Nonperforming assets to

Ending loans, plus OREO 1.04 %0.98 %0.90 %0.86 %0.77 %1.04 %0.77 %

Total assets 0.62 %0.60 %0.56 %0.55 %0.49 %0.62 %0.49 %

Nonperforming assets, excluding accruing TDRs to

Ending loans, plus OREO 0.91 %0.87 %0.83 %0.78 %0.68 %0.91 %0.68 %

Total assets 0.54 %0.53 %0.51 %0.50 %0.44 %0.54 %0.44 %

Classified assets to total assets 1.14 %1.22 %0.89 %0.84 %0.79 %1.14 %0.79 %



^(1) Nonaccrual loans include nonaccrual TDRs of $21.5 million, $20.9 million, $14.7 million, $29.3 million, and $32.7 million, as of June 30, 2021, March 31, 2021, December 31, 2020, September 30, 2020, and June 30, 2020, respectively.

FIRST FINANCIAL BANCORP.

CAPITAL ADEQUACY

(Dollars in thousands, except per share data)

(Unaudited)

Six months ended,

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

2021 2021 2020 2020 2020 2021 2020

PER COMMON SHARE

Market Price

High $26.02 $26.40 $17.77 $15.15 $16.38 $26.40 $25.52

Low $23.35 $17.62 $12.07 $11.40 $11.52 $17.62 $11.52

Close $23.63 $24.00 $17.53 $12.01 $13.89 $23.63 $13.89



Average shares outstanding - basic 96,123,645 96,873,940 97,253,787 97,247,080 97,220,748 96,496,720 97,478,719

Average shares outstanding - diluted 97,009,712 97,727,527 98,020,534 98,008,733 97,988,600 97,366,640 98,172,408

Ending shares outstanding 96,199,509 97,517,693 98,021,929 97,999,763 98,018,858 96,199,509 98,018,858



Total shareholders' equity $2,269,507 $2,258,942 $2,282,070 $2,247,815 $2,221,019 $2,269,507 $2,221,019



REGULATORY CAPITAL Preliminary Preliminary

Common equity tier 1 capital $1,333,209 $1,334,882 $1,325,922 $1,293,716 $1,267,609 $1,333,209 $1,267,609

Common equity tier 1 capital ratio 11.78 %11.81 %11.82 %11.63 %11.49 %11.78 %11.49 %

Tier 1 capital $1,376,333 $1,377,892 $1,368,818 $1,336,497 $1,310,276 $1,376,333 $1,310,276

Tier 1 ratio 12.16 %12.19 %12.20 %12.02 %11.87 %12.16 %11.87 %

Total capital $1,732,930 $1,741,755 $1,744,802 $1,708,817 $1,676,532 $1,732,930 $1,676,532

Total capital ratio 15.31 %15.41 %15.55 %15.37 %15.19 %15.31 %15.19 %

Total capital in excess of minimum requirement $544,478 $554,834 $566,795 $541,263 $517,902 $544,478 $517,902

Total risk-weighted assets $11,318,590 $11,304,012 $11,219,114 $11,119,560 $11,034,570 $11,318,590 $11,034,570

Leverage ratio 9.14 %9.34 %9.55 %9.55 %8.98 %9.14 %8.98 %



OTHER CAPITAL RATIOS

Ending shareholders' equity to ending assets 14.15 %13.97 %14.29 %14.11 %13.99 %14.15 %13.99 %

Ending tangible shareholders' equity to ending tangible assets ^(1) 8.37 %8.22 %8.47 %8.25 %8.09 %8.37 %8.09 %

Average shareholders' equity to average assets 13.96 %14.17 %14.07 %14.08 %13.91 %14.06 %14.54 %

Average tangible shareholders' equity to average tangible assets ^(1)8.23 %8.38 %8.26 %8.18 %7.94 %8.30 %8.34 %



REPURCHASE PROGRAM ^(2)

Shares repurchased 1,308,945 840,115 0 0 0 2,149,060 880,000

Average share repurchase price $25.11 $21.40 N/A N/A N/A $23.66 $18.96

Total cost of shares repurchased $32,864 $17.982 N/A N/A N/A $50,846 $16,686



^(1) Non-GAAP measure. For details on the calculation of these non-GAAP financial measures and a reconciliation to the GAAP financial measure, see the sections titled "Use of Non-GAAP Financial Measures" in this release and "Appendix: Non-GAAP to GAAP Reconciliation" in the accompanying slide presentation.

^(2) Represents share repurchases as part of publicly announced plans.



N/A = Not applicable

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SOURCE First Financial Bancorp.