GlobeNewswire Inc | Jul 26, 2021 04:00PM EDT

July 26, 2021

Highlights and Developments

-- Net income available to common stockholders of $59.6 million compared to $30.1 million for the second quarter of 2020, an increase of $29.5 million or 98% -- Net income available to common stockholders of $110.4 million compared to $50.2 million for the six months ended June 30, 2020, an increase of $60.2 million or 120% -- Diluted earnings per common share of $1.41 compared to $0.82 for the second quarter of the prior year, an increase of $0.59 or 72% -- Quarterly loan growth was $287.7 million or 13% annualized, exclusive of Paycheck Protection Program ("PPP") loans -- Non-time deposit growth of $133.3 million or 1% for the second quarter of 2021 and $780.0 million or 6% for the six months ended June 30, 2021 -- Annualized net charge off ratio of 0.12%, nonperforming assets to total assets of 0.50%, and 30-89 day loan delinquencies of 0.17% -- Announced a 14% increase in the regular quarterly dividend to $0.25 per common share

Quarter EndedJune Six Months Ended June 30, 30, 2021 2020 2021 2020Net income available tocommon stockholders (in $ 59.6 $ 30.1 $ 110.4 $ 50.2 millions)Diluted earnings per common 1.41 0.82 2.61 1.36 share Return on average assets 1.35 % 0.84 % 1.27 % 0.73 %Return on average common 12.07 7.69 11.29 6.32 equityReturn on average tangible 18.05 11.97 16.99 9.95 common equity (non-GAAP)^(1)Net interest margin 3.37 3.81 3.40 3.81 Net interest margin, fully 3.41 3.85 3.45 3.85 tax-equivalent (non-GAAP)^(1)Efficiency ratio, fully-tax 57.11 55.75 56.86 58.64 equivalent (non-GAAP)^(1)

(1) Refer to "Non-GAAP Measures" in this earnings release for additional information on the usage and presentation of these non-GAAP measures, and refer to the financial tables for reconciliations to the most directly comparable GAAP measures.

"HTLF's second quarter 2021 financial performance was strong. Net incomeavailable to common stockholders totaled $59.6 million, which was a 98%increase over the same quarter last year. Loan growth, excluding PPP loans,non-time deposit growth and improved credit quality all contributed to oursuccess this quarter."Bruce K. Lee, president and chief executive officer, HTLF

DUBUQUE, Iowa, July 26, 2021 (GLOBE NEWSWIRE) -- Heartland Financial USA, Inc. (NASDAQ: HTLF) today reported the following results for the quarter ended June 30, 2021 compared to the quarter ended June 30, 2020:

-- Net income available to common stockholders of $59.6 million compared to $30.1 million, an increase of $29.5 million or 98%. -- Earnings per diluted common share of $1.41 compared to $0.82, an increase of $0.59 or 72%. -- Net interest income of $141.2 million compared to $124.1 million, an increase of $17.1 million or 14%. -- Return on average common equity was 12.07% and return on average assets was 1.35% compared to 7.69% and 0.84%. -- Return on average tangible common equity (non-GAAP) was 18.05% compared to 11.97%.

HTLF report the following results for the six months ended June 30, 2021 compared to the six months ended June 30, 2020:

-- Net income available to common stockholders of $110.4 million compared to $50.2 million, an increase of $60.2 million or 120%. -- Earnings per diluted common share of $2.61 compared to $1.36, an increase of $1.25 or 92%. -- Net interest income of $280.8 million compared to $236.7 million, an increase of $44.2 million or 19%. -- Return on average common equity was 11.29% and return on average assets was 1.27% compared to 6.32% and 0.73%. -- Return on average tangible common equity (non-GAAP) was 16.99% compared to 9.95%.

"HTLF's second quarter 2021 financial performance was strong. Net income available to common stockholders totaled $59.6 million, which was a 98% increase over the same quarter last year. Loan growth, excluding PPP loans, non-time deposit growth and improved credit quality also contributed to our success this quarter," said Bruce K. Lee, president and chief executive officer of HTLF.

Net Interest Income and Net Interest Margin

Net interest margin, expressed as a percentage of average earning assets, was 3.37% (3.41% on a fully tax-equivalent basis, non-GAAP) during the second quarter of 2021, compared to 3.44% (3.48% on a fully tax-equivalent basis, non-GAAP) during the first quarter of 2021 and 3.81% (3.85% on a fully tax-equivalent basis, non-GAAP) during the second quarter of 2020.

Total interest income and average earning asset changes for the second quarter of 2021 compared to the second quarter of 2020 were:

-- Total interest income was $148.1 million, which was an increase of $14.3 million or 11% from $133.8 million and primarily attributable to an increase in average earning assets partially offset by lower yields. -- Total interest income on a tax-equivalent basis (non-GAAP) was $149.8 million, which was an increase of $14.7 million or 11% from $135.2 million. -- Average earning assets increased $3.72 billion or 28% to $16.82 billion compared to $13.10 billion, which was primarily attributable to recent acquisitions and loan growth, including PPP loans. -- The average rate on earning assets decreased 58 basis points to 3.57% compared to 4.15%, which was primarily due to recent decreases in market interest rates and a shift in earning asset mix. Total average securities were 39% of total earning average assets compared to 29%.

Total interest expense and average interest bearing liability changes for the second quarter of 2021 compared to the second quarter of 2020 were:

-- Total interest expense was $6.9 million, a decrease of $2.8 million or 29% from $9.6 million, based on a decrease in the average interest rate paid, which was partially offset by an increase in average interest bearing liabilities. -- The average interest rate paid on interest bearing liabilities decreased to 0.28% compared to 0.47%, which was primarily due to recent decreases in market interest rates. -- Average interest bearing deposits increased $1.62 billion or 21% to $9.41 billion from $7.79 billion which was primarily attributable to recent acquisitions and deposit growth, including deposits related to government stimulus payments and other COVID-19 relief programs. -- The average interest rate paid on interest bearing deposits decreased 16 basis points to 0.16% compared to 0.32%. -- Average borrowings increased $97.0 million or 26% to $465.9 million from $368.9 million, which was primarily attributable to outstanding advances from the PPP lending fund used to fund PPP loans to borrowers. The average interest rate paid on borrowings was 2.65% compared to 3.80%.

Net interest income increased for the second quarter of 2021 compared to the second quarter of 2020:

-- Net interest income totaled $141.2 million compared to $124.1 million, which was an increase of $17.1 million or 14%. -- Net interest income on a tax-equivalent basis (non-GAAP) totaled $143.0 million compared to $125.6 million, which was an increase of $17.4 million or 14%.

Noninterest Income and Noninterest Expense

Total noninterest income was $33.2 million during the second quarter of 2021 compared to $30.6 million during the second quarter of 2020, an increase of $2.5 million or 8%. Significant changes within the noninterest income category for the second quarter of 2021 compared to the second quarter of 2020 were:

-- Service charges and fees increased $4.2 million or 38% to $15.1 million from $11.0 million. Service charges and fees on retail and small business accounts increased $2.5 million to $7.3 million from $4.9 million. During the second quarter of 2020, HTLF was waiving service charges and fees due to the COVID-19 pandemic. -- Trust fees increased $1.1 million or 21% to $6.0 million from $5.0 million. The increase was primarily attributable to an increase in market value of trust assets under management. -- Net gains on sales of loans held for sale totaled $4.8 million compared to $7.9 million, which was a decrease of $3.1 million or 40% and was primarily attributable to a decrease of loans sold to the secondary market.

Total noninterest expense was $103.4 million during the second quarter of 2021 compared to $90.4 million during the second quarter of 2020, which was an increase of $12.9 million or 14%. Significant changes within the noninterest expense category for the second quarter of 2021 compared to the second quarter of 2020 were:

-- Salaries and employee benefits totaled $57.3 million compared to $50.1 million, which was an increase of $7.2 million or 14%. Full-time equivalent employees increased 270 to 2,091 compared to 1,821 which was primarily attributable to the acquisitions completed in the fourth quarter of 2020. -- Professional fees increased $2.6 million or 19% to $16.2 million compared to $13.7 million, which was primarily attributable to utilization of specialized resources to support automation and technology projects, including the customer service call center. -- Other noninterest expenses increased $1.6 million or 14% to $12.7 million compared to $11.1 million. The increase was primarily attributable to the acquisitions completed in the fourth quarter of 2020.

The effective tax rate was 21.11% for the second quarter of 2021 compared to 19.75% for the second quarter of 2020. The following items impacted the second quarter 2021 and 2020 tax calculations:

-- Solar energy tax credits of $1.3 million compared to $798,000. -- Federal low-income housing tax credits of $135,000 compared to $195,000. -- New markets tax credits of $75,000 in each quarterly calculation. -- Historic rehabilitation tax credits of $123,000 compared to $0. -- Tax-exempt interest income as a percentage of pre-tax income of 8.49% compared to 14.19%. -- Tax benefit of $150,000 compared to tax expense of $66,000 resulting from the vesting of restricted stock unit awards.

Total Assets, Total Loans and Total Deposits

Total assets were $18.37 billion at June 30, 2021, an increase of $462.7 million or 3% from $17.91 billion at year-end 2020. Securities represented 37% and 35% of total assets at June 30, 2021, and December 31, 2020, respectively.

Total loans held to maturity were $10.01 billion at June 30, 2021, $10.05 billion at March 31, 2021, and $10.02 billion at December 31, 2020. Excluding total PPP loans, loans increased $287.7 million or 13% annualized during the second quarter of 2021 and $117.6 million or 2.6% annualized since year-end 2020.

Significant changes by loan category at June 30, 2021 compared to March 31, 2021 included:

-- Commercial and business lending, which includes commercial and industrial, PPP and owner occupied commercial real estate loans, decreased $125.9 million or 2% to $5.29 billion compared to $5.41 billion. PPP loans originated in 2020 ("PPP I") decreased $365.4 million or 49%. PPP loans originated in 2021 ("PPP II") increased $39.2 million or 9%.Excluding total PPP loans, commercial and business lending increased $200.2 million or 5% to $4.46 billion from $4.29 billion. -- Commercial real estate lending, which includes non-owner occupied commercial real estate and construction loans, increased $78.5 million or 3% to $2.84 billion compared to $2.76 billion.

Significant changes by loan category at June 30, 2021 compared to December 31, 2020, included:

-- Commercial and business lending, which includes commercial and industrial, PPP and owner occupied commercial real estate loans, increased $19.2 million or less than 1%, to $5.29 billion compared to $5.27 billion. PPP I loans decreased $583.6 million or 61%. PPP II loans totaled $455.0 million.Excluding total PPP loans, commercial and business lending increased $147.8 million or 3% to $4.46 billion from $4.31 billion. -- Commercial real estate lending, which includes non-owner occupied commercial real estate and construction loans, increased $57.0 million or 2% to $2.84 billion compared to $2.78 billion. -- Residential mortgage loans decreased $39.5 million or 5% to $800.9 million compared to $840.4 million. -- Agriculture and agricultural real estate loans decreased $34.9 million or 5% to $679.6 million compared to $714.5 million.

Total deposits were $15.62 billion as of June 30, 2021, $15.56 billion as of March 31, 2021 and $14.98 billion at year-end 2020. Significant deposit changes by category at June 30, 2021 compared to March 31, 2021 included:

-- Demand deposits increased $123.3 million or 2% to $6.30 billion compared to $6.18 billion. -- Time deposits decreased $77.2 million or 6% to $1.13 billion from $1.20 billion.

Significant deposit changes by category at June 30, 2021 compared to December 31, 2020 included:

-- Demand deposits increased $610.5 million or 11% to $6.30 billion compared to $5.69 billion. -- Time deposits decreased $144.8 million or 11% to $1.13 billion from $1.27 billion.

Growth in demand deposits during the second quarter and first six months of 2021 was positively impacted by payments related to federal government stimulus programs and other COVID-19 relief programs.

Provision and Allowance

Provision and Allowance for Credit Losses for Loans Provision benefit for credit losses for loans for the second quarter of 2021 was $6.5 million, which was a decrease of $31.5 million from provision expense of $25.0 million recorded in the second quarter of 2020. The provision benefit for the second quarter of 2021 was impacted by several factors, including:

-- increases in balances of loans held to maturity of $287.7 million during the second quarter, excluding total PPP loans; -- modest improvements in credit quality marked by a decrease in nonperforming loans of $6.5 million to $85.4 million and nonpass loans of 10.37% of total loans for the second quarter compared to nonperforming loans of $91.9 million and nonpass loans of 11.47% of total loans at March 31, 2021, and -- improved macroeconomic factors compared to previous quarters.

The allowance for credit losses for loans totaled $120.7 million and $131.6 million at June 30, 2021, and December 31, 2020, respectively. The following items have impacted the allowance for credit losses for loans for the six months ended June 30, 2021:

-- Provision benefit for the six months ended June 30, 2021, totaled $6.5 million. -- Net charge offs of $4.4 million were recorded for the first six months of 2021.

Provision and Allowance for Credit Losses for Unfunded Commitments The allowance for unfunded commitments totaled $14.0 million at June 30, 2021, which was a decrease of $1.3 million from $15.3 million at December 31, 2020. Unfunded commitments increased $186.1 million to $3.43 billion at June 30, 2021 compared to $3.25 billion at December 31, 2020.

Total Provision and Allowance for Lending Related Credit LossesThe total provision benefit for lending related credit losses was $7.1 million for the second quarter of 2021 compared to provision expense of $26.9 million for the second quarter of 2020. The total allowance for lending related credit losses was $134.7 million at June 30, 2021, which was 1.35% of total loans as of June 30, 2021, compared to $146.9 million or 1.47% of total loans as of December 31, 2020. Excluding PPP loans, the allowance for lending related credit losses as a percentage of total loans was 1.47% and 1.62% as of June 30, 2021, and December 31, 2020, respectively.

Nonperforming Assets

Nonperforming assets decreased $3.2 million or 3% to $91.7 million or 0.50% of total assets at June 30, 2021, compared to $95.0 million or 0.53% of total assets at December 31, 2020. Nonperforming loans were $85.4 million or 0.85% of total loans at June 30, 2021, compared to $88.1 million or 0.88% of total loans at December 31, 2020. At June 30, 2021, loans delinquent 30-89 days were 0.17% of total loans compared to 0.23% of total loans at December 31, 2020.

Non-GAAP Financial MeasuresThis earnings release contains references to financial measures which are not defined by generally accepted accounting principles ("GAAP"). Management believes the non-GAAP measures are helpful for investors to analyze and evaluate the company's financial condition and operating results. However, these non-GAAP measures have inherent limitations and should not be considered a substitute for operating results determined in accordance with GAAP. Additionally, because non-GAAP measures are not standardized, it may not be possible to compare the non-GAAP measures in this earnings release with other companies' non-GAAP measures. Reconciliations of each non-GAAP measure to the most directly comparable GAAP measure may be found in the financial tables in this earnings release.

Below are the non-GAAP measures included in this earnings release, management's reason for including each measure and the method of calculating each measure:

-- Annualized net interest margin, fully tax-equivalent, adjusts net interest income for the tax-favored status of certain loans and securities. Management believes this measure enhances the comparability of net interest income arising from taxable and tax-exempt sources. -- Efficiency ratio, fully tax equivalent, expresses noninterest expenses as a percentage of fully tax-equivalent net interest income and noninterest income. This efficiency ratio is presented on a tax-equivalent basis which adjusts net interest income and noninterest expenses for the tax favored status of certain loans, securities, and tax credit projects. Management believes the presentation of this non-GAAP measure provides supplemental useful information for proper understanding of the financial results as it enhances the comparability of income and expenses arising from taxable and nontaxable sources and excludes specific items as noted in reconciliation contained in this earnings release. -- Net interest income, fully tax equivalent, is net income adjusted for the tax-favored status of certain loans and securities. Management believes this measure enhances the comparability of net interest income arising from taxable and tax-exempt sources. -- Tangible book value per common share is total common equity less goodwill and core deposit and customer relationship intangibles, net, divided by common shares outstanding, net of treasury. This measure is included as it is considered to be a critical metric to analyze and evaluate use of equity, financial condition and capital strength. -- Tangible common equity ratio is total common equity less goodwill and core deposit and customer relationship intangibles, net, divided by total assets less goodwill and core deposit and customer relationship intangibles, net. This measure is included as it is considered to be a critical metric to analyze and evaluate financial condition and capital strength. -- Annualized return on average tangible common equity is net income excluding intangible amortization calculated as (1) net income excluding tax-effected core deposit and customer relationship intangibles amortization, divided by (2) average common equity less goodwill and core deposit and customer relationship intangibles, net. This measure is included as it is considered to be a critical metric to analyze and evaluate use of equity, financial condition and capital strength.

Conference Call DetailsHTLF will host a conference call for shareholders, analysts and other interested parties at 5:00 p.m. EDT today. To join, please register in advance of the conference using the link provided below. Upon registering, participant dial-in numbers, Direct Event passcode and unique registrant ID will be provided. Direct Event online registration can be found at: http://www.directeventreg.com/registration/event/3970348. In the 10 minutes prior to the call start time, participants need to use the conference access information provided in the email received at the point of registering. A replay will be available until July 25, 2022, by logging on to www.htlf.com.

About HTLFHeartland Financial USA, Inc., operating under the brand name HTLF, is a financial services company with assets of $18.37 billion. HTLF has banks serving communities in Arizona, California, Colorado, Illinois, Iowa, Kansas, Minnesota, Missouri, Montana, New Mexico, Texas and Wisconsin. HTLF is committed to its core commercial business, supported by a strong retail operation, and provides a diversified line of financial services including treasury management, residential mortgage, wealth management, investment and insurance. Additional information is available at www.htlf.com.

Safe Harbor StatementThis release (including any information incorporated herein by reference), and future oral and written statements of the company and its management, may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, with respect to the business, financial condition, results of operations, plans, objectives and future performance of HTLF.

Any statements about the company's expectations, beliefs, plans, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. Forward-looking statements may include information about possible or assumed future results of the company's operations or performance. These forward-looking statements are generally identified by the use of the words such as "believe", "expect", "intent", "anticipate", "plan", "intend", "estimate", "project", "may", "will", "would", "could", "should", "may", "view", "opportunity", "potential", or similar or negative expressions of these words or phrases that are used in this release, and future oral and written statements of the company and its management. Although the company may make these statements based on managements experience, beliefs, expectations, assumptions and best estimate of future events, the ability of the company to predict results or the actual effect or outcomes of plans or strategies is inherently uncertain, and there may be events or factors that management has not anticipated. Therefore, the accuracy and achievement of such forward-looking statements and estimates are subject to a number of risks, many of which are beyond the ability of management to control or predict, that could cause actual results to differ materially from those in its forward-looking statements. These factors, which the company currently believes could have a material effect on its operations and future prospects, are detailed below and in the risk factors in HTLF's reports filed with the Securities and Exchange Commission ("SEC"), including the "Risk Factors" section under Item 1A of Part I of the companys Annual Report on Form 10-K for the year ended December 31, 2020, include, among others:

-- COVID-19 Pandemic Risks, including risks related to the ongoing COVID-19 pandemic and measures enacted by the U.S. federal and state governments and adopted by private businesses in response to the COVID-19 pandemic; -- Economic and Market Conditions Risks, including risks related to changes in the U.S. economy in general and in the local economies in which HTLF conducts its operations and future civil unrest, natural disasters, terrorist threats or acts of war; -- Credit Risks, including risks of increasing credit losses due to deterioration in the financial condition of HTLF's borrowers, changes in asset and collateral values and climate and other borrower industry risks which may impact the provision for credit losses and net charge-offs; -- Liquidity and Interest Rate Risks, including the impact of capital market conditions and changes in monetary policy on our borrowings and net interest income; -- Operational Risks, including processing, information systems, cybersecurity, vendor, business interruption, and fraud risks; -- Strategic and External Risks, including competitive forces impacting our business and strategic acquisition risks; -- Legal, Compliance and Reputational Risks, including regulatory and litigation risks; and -- Risks of Owning Stock in HTLF, including stock price volatility and dilution as a result of future equity offerings and acquisitions.

There can be no assurance that other factors not currently anticipated by HTLF will not materially and adversely affect the companys business, financial condition and results of operations. In addition, many of these risks and uncertainties are currently amplified by and may continue to be amplified by the COVID-19 pandemic and the impact of varying governmental responses that affect the companys customers and the economies where they operate. Additionally, all statements in this release, including forward-looking statements speak only as of the date they are made. The company does not undertake and specifically disclaims any obligation to publicly release the results of any revisions which may be made to or correct or update any forward-looking statement to reflect events or circumstances after the date of such statements or to reflect the occurrence of anticipated or unanticipated events or to otherwise update any statement in light of new information or future events. Further information concerning HTLF and its business, including additional factors that could materially affect the companys financial results, is included in the companys filings with the SEC.

CONTACT:Bryan R. McKeagExecutive Vice PresidentChief Financial Officer(563) 589-1994BMcKeag@htlf.com

HEARTLAND FINANCIAL USA, INC.CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA For the Quarter Ended For the Six Months Ended June 30, June 30, 2021 2020 2021 2020Interest Income Interest and fees on $ 111,915 $ 107,005 $ 224,354 $ 213,419 loansInterest on securities:Taxable 31,546 23,362 61,989 45,093 Nontaxable 4,561 3,344 9,064 5,527 Interest on federal ? ? 1 ? funds soldInterest on depositswith other banks and 60 54 126 775 short-terminvestmentsTotal Interest Income 148,082 133,765 295,534 264,814 Interest Expense Interest on deposits 3,790 6,134 8,185 20,716 Interest on 98 61 250 357 short-term borrowingsInterest on other 2,976 3,424 6,276 7,084 borrowingsTotal Interest 6,864 9,619 14,711 28,157 ExpenseNet Interest Income 141,218 124,146 280,823 236,657 Provision (benefit) (7,080 ) 26,796 (7,728 ) 48,316 for credit lossesNet Interest IncomeAfter Provision for 148,298 97,350 288,551 188,341 Credit LossesNoninterest Income Service charges and 15,132 10,972 28,803 22,993 feesLoan servicing income 873 379 1,711 1,342 Trust fees 6,039 4,977 11,816 9,999 Brokerage and 865 595 1,718 1,328 insurance commissionsSecurities gains/ 2,842 2,006 2,812 3,664 (losses), netUnrealized gain/(loss) on equity 83 680 (27 ) 449 securities, netNet gains on sale of 4,753 7,857 11,173 12,517 loans held for saleValuation adjustment (526 ) 9 391 (1,556 )on servicing rightsIncome on bank owned 937 1,167 1,766 1,665 life insuranceOther noninterest 2,166 1,995 3,318 4,053 incomeTotal Noninterest 33,164 30,637 63,481 56,454 IncomeNoninterest Expense Salaries and employee 57,332 50,118 116,394 100,075 benefitsOccupancy 7,399 6,502 15,317 12,973 Furniture and 3,501 2,993 6,594 6,101 equipmentProfessional fees 16,237 13,676 29,727 26,149 Advertising 1,649 995 3,118 3,200 Core deposit andcustomer relationship 2,415 2,696 4,931 5,677 intangiblesamortizationOther real estate andloan collection 414 203 549 537 expenses, netLoss on sales/valuations of assets, 183 701 377 717 netAcquisition,integration and 210 673 3,138 2,049 restructuring costsPartnershipinvestment in tax 1,345 791 1,380 975 credit projectsOther noninterest 12,691 11,091 24,274 22,845 expensesTotal Noninterest 103,376 90,439 205,799 181,298 ExpenseIncome Before Income 78,086 37,548 146,233 63,497 TaxesIncome taxes 16,481 7,417 31,814 13,326 Net Income 61,605 30,131 114,419 50,171 Preferred dividends (2,012 ) ? (4,025 ) ? Net Income Availableto Common $ 59,593 $ 30,131 $ 110,394 $ 50,171 StockholdersEarnings per common $ 1.41 $ 0.82 $ 2.61 $ 1.36 share-dilutedWeighted averageshares 42,359,873 36,915,630 42,357,133 36,919,555 outstanding-diluted

HEARTLAND FINANCIAL USA, INC.CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA For the Quarter Ended 6/30/2021 3/31/2021 12/31/2020 9/30/2020 6/30/2020Interest Income Interest and fees $ 111,915 $ 112,439 $ 108,865 $ 102,657 $ 107,005 on loansInterest on securities:Taxable 31,546 30,443 28,154 25,016 23,362 Nontaxable 4,561 4,503 3,735 3,222 3,344 Interest on federal ? 1 ? ? ? funds soldInterest ondeposits with otherbanks and 60 66 77 72 54 short-terminvestmentsTotal Interest 148,082 147,452 140,831 130,967 133,765 IncomeInterest Expense Interest on 3,790 4,395 4,609 4,962 6,134 depositsInterest onshort-term 98 152 175 78 61 borrowingsInterest on other 2,976 3,300 3,472 3,430 3,424 borrowingsTotal Interest 6,864 7,847 8,256 8,470 9,619 ExpenseNet Interest Income 141,218 139,605 132,575 122,497 124,146 Provision (benefit) (7,080 ) (648 ) 17,072 1,678 26,796 for credit lossesNet Interest IncomeAfter Provision for 148,298 140,253 115,503 120,819 97,350 Credit LossesNoninterest Income Service charges and 15,132 13,671 12,725 11,749 10,972 feesLoan servicing 873 838 997 638 379 incomeTrust fees 6,039 5,777 5,506 5,357 4,977 Brokerage andinsurance 865 853 779 649 595 commissionsSecurities gains/ 2,842 (30 ) 2,829 1,300 2,006 (losses), netUnrealized gain/(loss) on equity 83 (110 ) 36 155 680 securities, netNet gains on saleof loans held for 4,753 6,420 7,104 8,894 7,857 saleValuationadjustment on (526 ) 917 (102 ) (120 ) 9 servicing rightsIncome on bankowned life 937 829 1,021 868 1,167 insuranceOther noninterest 2,166 1,152 1,726 1,726 1,995 incomeTotal Noninterest 33,164 30,317 32,621 31,216 30,637 IncomeNoninterest Expense Salaries and 57,332 59,062 51,615 50,978 50,118 employee benefitsOccupancy 7,399 7,918 6,849 6,732 6,502 Furniture and 3,501 3,093 3,913 2,500 2,993 equipmentProfessional fees 16,237 13,490 15,117 12,802 13,676 Advertising 1,649 1,469 1,107 928 995 Core deposit andcustomerrelationship 2,415 2,516 2,501 2,492 2,696 intangiblesamortizationOther real estateand loan collection 414 135 468 335 203 expenses, netLoss on sales/valuations of 183 194 2,621 1,763 701 assets, netAcquisition,integration and 210 2,928 2,186 1,146 673 restructuring costsPartnershipinvestment in tax 1,345 35 1,899 927 791 credit projectsOther noninterest 12,691 11,583 10,993 9,793 11,091 expensesTotal Noninterest 103,376 102,423 99,269 90,396 90,439 ExpenseIncome Before 78,086 68,147 48,855 61,639 37,548 Income TaxesIncome taxes 16,481 15,333 9,046 13,681 7,417 Net Income 61,605 52,814 39,809 47,958 30,131 Preferred dividends (2,012 ) (2,013 ) (2,014 ) (2,437 ) ? Net IncomeAvailable to Common $ 59,593 $ 50,801 $ 37,795 $ 45,521 $ 30,131 StockholdersEarnings per common $ 1.41 $ 1.20 $ 0.98 $ 1.23 $ 0.82 share-dilutedWeighted averageshares 42,359,873 42,335,747 38,534,082 36,995,572 36,915,630 outstanding-diluted

HEARTLAND FINANCIAL USA, INC.CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA As of 6/30/2021 3/31/2021 12/31/2020 9/30/2020 6/30/2020Assets Cash and due $ 208,702 $ 198,177 $ 219,243 $ 175,284 $ 211,429 from banksInterestbearingdeposits withother banks 240,426 269,685 118,660 156,371 242,149 andshort-terminvestmentsCash and cash 449,128 467,862 337,903 331,655 453,578 equivalentsTime depositsin other 3,138 3,138 3,129 3,129 3,128 financialinstitutionsSecurities: Carried at 6,543,978 6,370,495 6,127,975 4,950,698 4,126,351 fair valueHeld tomaturity, atcost, less 85,439 85,293 88,839 88,700 90,579 allowance forcredit lossesOtherinvestments, 76,809 74,935 75,253 35,940 35,902 at costLoans held 33,248 43,037 57,949 65,969 54,382 for saleLoans: Held to 10,012,014 10,050,456 10,023,051 9,099,646 9,246,830 maturityAllowance for (120,726 ) (130,172 ) (131,606 ) (103,377 ) (119,937 )credit lossesLoans, net 9,891,288 9,920,284 9,891,445 8,996,269 9,126,893 Premises,furniture and 226,358 225,047 226,094 200,028 198,481 equipment,netGoodwill 576,005 576,005 576,005 446,345 446,345 Core depositand customerrelationship 37,452 39,867 42,383 40,520 43,011 intangibles,netServicing 6,201 6,953 6,052 5,752 5,469 rights, netCashsurrender 189,619 188,521 187,664 173,111 172,813 value on lifeinsuranceOther real 6,314 6,236 6,624 5,050 5,539 estate, netOther assets 246,029 236,754 281,024 269,498 263,682 Total Assets $ 18,371,006 $ 18,244,427 $ 17,908,339 $ 15,612,664 $ 15,026,153 Liabilities and EquityLiabilities Deposits: Demand $ 6,299,289 $ 6,175,946 $ 5,688,810 $ 5,022,567 $ 4,831,151 Savings 8,189,223 8,179,251 8,019,704 6,742,151 6,810,296 Time 1,126,606 1,203,854 1,271,391 1,002,392 1,067,252 Total 15,615,118 15,559,051 14,979,905 12,767,110 12,708,699 depositsShort-term 152,563 140,597 167,872 306,706 88,631 borrowingsOther 271,244 349,514 457,042 524,045 306,459 borrowingsAccruedexpenses and 172,295 139,058 224,289 203,199 174,987 otherliabilitiesTotal 16,211,220 16,188,220 15,829,108 13,801,060 13,278,776 LiabilitiesStockholders' EquityPreferred 110,705 110,705 110,705 110,705 110,705 equityCommon stock 42,245 42,174 42,094 36,885 36,845 Capital 1,066,765 1,063,497 1,062,083 847,377 844,202 surplusRetained 883,484 833,171 791,630 761,211 723,067 earningsAccumulatedother 56,587 6,660 72,719 55,426 32,558 comprehensiveincomeTotal Equity 2,159,786 2,056,207 2,079,231 1,811,604 1,747,377 TotalLiabilities $ 18,371,006 $ 18,244,427 $ 17,908,339 $ 15,612,664 $ 15,026,153 and Equity

HEARTLAND FINANCIAL USA, INC.CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA AND FULL TIME EQUIVALENT EMPLOYEEDATA For the Quarter Ended 6/30/2021 3/31/2021 12/31/2020 9/30/2020 6/30/2020Average BalancesAssets $ 18,293,756 $ 17,964,723 $ 16,401,152 $ 15,167,225 $ 14,391,856 Loans, net of 10,072,071 9,952,152 9,366,430 9,220,666 9,186,913 unearnedDeposits 15,576,345 15,044,561 13,518,020 12,650,822 12,288,378 Earning assets 16,819,978 16,460,124 15,042,079 13,868,360 13,103,159 Interestbearing 9,871,302 9,917,159 9,053,855 8,320,123 8,155,753 liabilitiesCommon equity 1,980,904 1,963,674 1,769,575 1,661,381 1,574,902 Totalstockholders' 2,091,609 2,074,379 1,880,280 1,772,086 1,580,997 equityTangiblecommon equity 1,366,285 1,346,270 1,238,691 1,172,891 1,083,834 (non-GAAP)^(1) KeyPerformance RatiosAnnualizedreturn on 1.35 % 1.19 % 0.97 % 1.26 % 0.84 %average assetsAnnualizedreturn on 12.07 10.49 8.50 10.90 7.69 average commonequity (GAAP)Annualizedreturn onaverage 18.05 15.90 12.77 16.11 11.97 tangiblecommon equity(non-GAAP)^(1)Annualizedratio of net 0.12 0.06 0.01 0.92 0.11 charge-offs toaverage loansAnnualized netinterest 3.37 3.44 3.51 3.51 3.81 margin (GAAP)Annualized netinterestmargin, fully 3.41 3.48 3.55 3.55 3.85 tax-equivalent(non-GAAP)^(1)Efficiencyratio, fully 57.11 56.61 54.93 54.67 55.75 tax-equivalent(non-GAAP)^(1)

For the Quarter Ended For the Six Months Ended June 30, June 30, 2021 2020 2021 2020Average BalancesAssets $ 18,293,756 $ 14,391,856 $ 18,130,148 $ 13,770,015 Loans, net of 10,072,071 9,186,913 10,012,443 8,775,566 unearnedDeposits 15,576,345 12,288,378 15,311,921 11,629,785 Earning assets 16,819,978 13,103,159 16,641,045 12,497,307 Interestbearing 9,871,302 8,155,753 9,894,103 7,998,847 liabilitiesCommon equity 1,980,904 1,574,902 1,972,337 1,597,292 Totalstockholders' 2,091,609 1,580,997 2,083,042 1,600,340 equityTangiblecommon 1,366,285 1,083,834 1,356,333 1,104,770 stockholders'equity KeyPerformance RatiosAnnualizedreturn on 1.35 % 0.84 % 1.27 % 0.73 %average assetsAnnualizedreturn on 12.07 7.69 11.29 6.32 average commonequity (GAAP)Annualizedreturn onaverage 18.05 11.97 16.99 9.95 tangiblecommon equity(non-GAAP)^(1)Annualizedratio of net 0.12 0.11 0.09 0.17 charge-offs toaverage loansAnnualized netinterest 3.37 3.81 3.40 3.81 margin (GAAP)Annualized netinterestmargin, fully 3.41 3.85 3.45 3.85 tax-equivalent(non-GAAP)^(1)Efficiencyratio, fully 57.11 55.75 56.86 58.64 tax-equivalent(non-GAAP)^(1) (1) Refer to "Non-GAAP Measures" in this earnings release for additionalinformation on the usage and presentation of these non-GAAP measures, and referto these financial tables for the reconciliations to the most directlycomparable GAAP measures.

HEARTLAND FINANCIAL USA, INC.CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)DOLLARS IN THOUSANDS, EXCEPT PER SHARE AND FULL TIME EQUIVALENT EMPLOYEE DATA As of and for the Quarter Ended 6/30/2021 3/31/2021 12/31/2020 9/30/2020 6/30/2020Common Share DataBook valueper common $ 48.50 $ 46.13 $ 46.77 $ 46.11 $ 44.42 shareTangiblebook valueper common $ 33.98 $ 31.53 $ 32.07 $ 32.91 $ 31.14 share(non-GAAP)^(1)Commonsharesoutstanding, 42,245,452 42,173,675 42,093,862 36,885,390 36,844,744 net oftreasurystockTangiblecommonequity ratio 8.08 % 7.54 % 7.81 % 8.03 % 7.89 %(non-GAAP)^(1) OtherSelected TrendInformationEffective 21.11 % 22.50 % 18.52 % 22.20 % 19.75 %tax rateFull timeequivalent 2,091 2,131 2,013 1,827 1,821 employees Loans Held to MaturityCommercialand $ 2,518,908 $ 2,421,260 $ 2,534,799 $ 2,303,646 $ 2,364,400 industrialPaycheckProtection 829,175 1,155,328 957,785 1,128,035 1,124,430 Program("PPP")Owneroccupied 1,940,134 1,837,559 1,776,406 1,494,902 1,433,271 commercialreal estateCommercialand business 5,288,217 5,414,147 5,268,990 4,926,583 4,922,101 lendingNon-owneroccupied 1,987,369 1,967,183 1,921,481 1,659,683 1,543,623 commercialreal estateReal estate 854,295 796,027 863,220 917,765 1,115,843 constructionCommercialreal estate 2,841,664 2,763,210 2,784,701 2,577,448 2,659,466 lendingTotalcommercial 8,129,881 8,177,357 8,053,691 7,504,031 7,581,567 lendingAgriculturaland 679,608 683,969 714,526 508,058 520,773 agriculturalreal estateResidential 800,884 786,994 840,442 701,899 735,762 mortgageConsumer 401,641 402,136 414,392 385,658 408,728 Total loansheld to $ 10,012,014 $ 10,050,456 $ 10,023,051 $ 9,099,646 $ 9,246,830 maturity Totalunfunded $ 3,433,062 $ 3,306,042 $ 3,246,953 $ 2,980,484 $ 3,065,283 loancommitments (1) Refer to "Non-GAAP Measures" in this earnings release for additionalinformation on the usage and presentation of these non-GAAP measures, and referto these financial tables for the reconciliations to the most directlycomparable GAAP measures.

HEARTLAND FINANCIAL USA, INC.CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA As of and for the Quarter Ended 6/30/2021 3/31/2021 12/31/2020 9/30/2020 6/30/2020Allowance forCredit Losses-LoansBalance,beginning of $ 130,172 $ 131,606 $ 103,377 $ 119,937 $ 97,350 periodAllowance foracquiredpurchased ? ? 12,313 ? ? creditdeterioratedloansProvision(benefit) for (6,466 ) 16 16,132 4,741 25,007 credit lossesCharge-offs (3,497 ) (2,126 ) (1,104 ) (21,753 ) (3,564 )Recoveries 517 676 888 452 1,144 Balance, end of $ 120,726 $ 130,172 $ 131,606 $ 103,377 $ 119,937 period Allowance forUnfunded CommitmentsBalance,beginning of $ 14,619 $ 15,280 $ 14,330 $ 17,392 $ 15,468 periodProvision(benefit) for (617 ) (661 ) 950 (3,062 ) 1,924 credit lossesBalance, end of $ 14,002 $ 14,619 $ 15,280 $ 14,330 $ 17,392 period Allowance forlending related $ 134,728 $ 144,791 $ 146,886 $ 117,707 $ 137,329 credit losses Provision for Credit LossesProvision(benefit) for $ (6,466 ) $ 16 $ 6,572 $ 4,741 $ 25,007 creditlosses-loansProvision forcredit ? ? 9,560 ? ? losses-acquiredloansProvision(benefit) forcredit (617 ) (661 ) (1,372 ) (3,062 ) 1,924 losses-unfundedcommitmentsProvision forcreditlosses-acquired ? ? 2,322 ? ? unfundedcommitmentsProvision(benefit) forcredit 3 (3 ) (10 ) (1 ) (135 )losses-held tomaturitysecuritiesTotal provision(benefit) for $ (7,080 ) $ (648 ) $ 17,072 $ 1,678 $ 26,796 credit losses

HEARTLAND FINANCIAL USA, INC.CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA As of and for the Quarter Ended 6/30/2021 3/31/2021 12/31/2020 9/30/2020 6/30/2020Asset Quality Nonaccrual loans $ 85,268 $ 91,718 $ 87,386 $ 79,040 $ 91,609 Loans past dueninety days or 97 171 720 1,681 1,360 moreOther real 6,314 6,236 6,624 5,050 5,539 estate ownedOtherrepossessed 50 239 240 130 29 assetsTotalnonperforming $ 91,729 $ 98,364 $ 94,970 $ 85,901 $ 98,537 assets Performingtroubled debt $ 2,122 $ 2,394 $ 2,370 $ 11,818 $ 2,636 restructuredloans Nonperforming Assets ActivityBalance,beginning of $ 98,364 $ 94,970 $ 85,901 $ 98,537 $ 85,371 periodNet loan charge (2,980 ) (1,450 ) (216 ) (21,301 ) (2,420 )offsNewnonperforming 7,989 14,936 8,664 11,834 26,857 loansAcquirednonperforming ? ? 12,781 ? ? assetsReduction ofnonperforming (10,948 ) (8,884 ) (10,811 ) (1,994 ) (9,911 )loans^(1)Net OREO/repossessedassets sales (696 ) (1,208 ) (1,349 ) (1,175 ) (1,360 )proceeds andlossesBalance, end of $ 91,729 $ 98,364 $ 94,970 $ 85,901 $ 98,537 period Asset Quality RatiosRatio ofnonperforming 0.85 % 0.91 % 0.88 % 0.89 % 1.01 %loans to totalloansRatio ofnonperformingloans andperforming 0.87 0.94 0.90 1.02 1.03 trouble debtrestructuredloans to totalloansRatio ofnonperforming 0.50 0.54 0.53 0.55 0.66 assets to totalassetsAnnualized ratioof net loan 0.12 0.06 0.01 0.92 0.11 charge-offs toaverage loansAllowance forloan credit 1.21 1.30 1.31 1.14 1.30 losses as apercent of loansAllowance forlending relatedcredit losses as 1.35 1.44 1.47 1.29 1.49 a percent ofloansAllowance forloan creditlosses as a 141.42 141.66 149.37 128.07 129.01 percent ofnonperformingloansLoans delinquent30-89 days as a 0.17 0.16 0.23 0.17 0.22 percent of totalloans (1) Includes principal reductions, transfers to performing status and transfersto OREO.

HEARTLAND FINANCIAL USA, INC. CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)DOLLARS IN THOUSANDS For the Quarter Ended June 30, 2021 March 31, 2021 June 30, 2020 Average Interest Rate Average Interest Rate Average Interest Rate Balance Balance BalanceEarning Assets Securities: Taxable $ 5,862,683 $ 31,546 2.16 % $ 5,693,097 $ 30,443 2.17 % $ 3,375,245 $ 23,362 2.78 %Nontaxable^(1) 740,601 5,773 3.13 730,565 5,700 3.16 433,329 4,233 3.93 Total securities 6,603,284 37,319 2.27 6,423,662 36,143 2.28 3,808,574 27,595 2.91 Interest on depositswith other banks and 271,891 60 0.09 204,488 66 0.13 210,347 54 0.10 short-term investmentsFederal funds sold ? ? ? 14,020 1 0.03 ? ? ? Loans:^(2) Commercial and 2,469,742 28,562 4.64 2,500,250 28,222 4.58 2,453,066 30,759 5.04 industrial^(1)PPP loans 1,047,559 11,186 4.28 992,517 10,149 4.15 916,405 6,017 2.64 Owner occupied 1,858,891 20,097 4.34 1,778,829 19,565 4.46 1,426,019 17,670 4.98 commercial real estateNon-owner occupied 1,980,374 21,734 4.40 1,937,564 22,121 4.63 1,540,958 19,055 4.97 commercial real estateReal estate 815,738 9,212 4.53 806,315 9,698 4.88 1,100,514 12,589 4.60 constructionAgricultural andagricultural real 672,560 7,267 4.33 681,279 8,051 4.79 532,668 6,171 4.66 estateResidential mortgage 827,291 9,255 4.49 849,923 9,830 4.69 795,149 9,586 4.85 Consumer 399,916 5,152 5.17 405,475 5,367 5.37 422,134 5,685 5.42 Less: allowance for (127,268 ) ? ? (134,198 ) ? ? (102,675 ) ? ? credit losses-loansNet loans 9,944,803 112,465 4.54 9,817,954 113,003 4.67 9,084,238 107,532 4.76 Total earning assets 16,819,978 149,844 3.57 % 16,460,124 149,213 3.68 % 13,103,159 135,181 4.15 %Nonearning Assets 1,473,778 1,504,599 1,288,697 Total Assets $ 18,293,756 $ 17,964,723 $ 14,391,856 Interest Bearing LiabilitiesSavings $ 8,234,151 $ 2,233 0.11 % $ 8,032,308 $ 2,430 0.12 % $ 6,690,504 $ 2,372 0.14 %Time deposits 1,171,266 1,557 0.53 1,233,682 1,965 0.65 1,096,386 3,762 1.38 Short-term borrowings 169,822 98 0.23 240,037 152 0.26 82,200 61 0.30 Other borrowings 296,063 2,976 4.03 411,132 3,300 3.26 286,663 3,424 4.80 Total interest bearing 9,871,302 6,864 0.28 % 9,917,159 7,847 0.32 % 8,155,753 9,619 0.47 %liabilitiesNoninterest Bearing LiabilitiesNoninterest bearing 6,170,928 5,778,571 4,501,488 depositsAccrued interest and 159,917 194,614 153,618 other liabilitiesTotal noninterest 6,330,845 5,973,185 4,655,106 bearing liabilitiesEquity 2,091,609 2,074,379 1,580,997 Total Liabilities and $ 18,293,756 $ 17,964,723 $ 14,391,856 EquityNet interest income,fully tax-equivalent $ 142,980 $ 141,366 $ 125,562 (non-GAAP)^(1)(3)Net interest spread^ 3.29 % 3.36 % 3.68 %(1)Net interest income,fully tax-equivalent 3.41 % 3.48 % 3.85 %(non-GAAP^)(1)(3) tototal earning assetsInterest bearingliabilities to earning 58.69 % 60.25 % 62.24 % assets (1) Computed on a tax-equivalent basis using an effective tax rate of 21%. (2) Nonaccrual loans and loans held for sale are included in the average loansoutstanding.(3) Refer to "Non-GAAP Measures" in this earnings release for additionalinformation on the usage and presentation of these non-GAAP measures, and referto these financial tables for the reconciliations to the most directlycomparable GAAP measures.

HEARTLAND FINANCIAL USA, INC.CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)DOLLARS IN THOUSANDS For the Six Months Ended June 30, 2021 June 30, 2020 Average Interest Rate Average Interest Rate Balance BalanceEarning Assets Securities: Taxable $ 5,778,333 $ 61,989 2.16 % $ 3,253,675 $ 45,093 2.79 %Nontaxable^(1) 735,636 11,473 3.15 360,932 6,996 3.90 %Total 6,513,969 73,462 2.27 3,614,607 52,089 2.90 securitiesInterestbearingdeposits withother banks 238,376 126 0.11 195,833 775 0.80 and othershort-terminvestmentsFederal funds 6,971 1 0.03 ? ? ? soldLoans:^(2) Commercial and 2,485,210 56,784 4.61 2,530,349 63,213 5.02 %industrial^(1)PPP loans 1,020,190 21,335 4.22 458,202 6,017 2.64 %Owner occupiedcommercial 1,818,932 39,662 4.40 1,429,560 36,251 5.10 %real estateNon-owneroccupied 1,958,938 43,855 4.51 1,506,583 38,585 5.15 %commercialreal estateReal estate 811,053 18,910 4.70 1,073,175 25,434 4.77 %constructionAgriculturaland 676,895 15,318 4.56 542,818 13,210 4.89 %agriculturalreal estateResidential 838,545 19,085 4.59 807,440 20,007 4.98 %mortgageConsumer 402,680 10,519 5.27 427,439 11,780 5.54 %Less:allowance for (130,714 ) ? ? (88,699 ) ? ? creditlosses-loansNet loans 9,881,729 225,468 4.60 8,686,867 214,497 4.97 Total earning 16,641,045 299,057 3.62 % 12,497,307 267,361 4.30 %assetsNonearning 1,489,103 1,272,708 AssetsTotal Assets $ 18,130,148 $ 13,770,015 InterestBearing LiabilitiesSavings $ 8,133,787 $ 4,663 0.12 % $ 6,484,016 $ 12,454 0.39 %Time deposits 1,202,301 3,522 0.59 % 1,121,502 8,262 1.48 Short-term 204,735 250 0.25 % 112,004 357 0.64 borrowingsOther 353,280 6,276 3.58 % 281,325 7,084 5.06 borrowingsTotal interestbearing 9,894,103 14,711 0.30 % 7,998,847 28,157 0.71 %liabilitiesNoninterestBearing LiabilitiesNoninterestbearing 5,975,833 4,024,267 depositsAccruedinterest and 177,170 146,561 otherliabilitiesTotalnoninterest 6,153,003 4,170,828 bearingliabilitiesStockholders' 2,083,042 1,600,340 EquityTotalLiabilitiesand $ 18,130,148 $ 13,770,015 Stockholders'EquityNet interestincome, fullytax-equivalent $ 284,346 $ 239,204 (non-GAAP)^(1)(3)Net interest 3.32 % 3.59 %spread^(1)Net interestincome, fullytax-equivalent 3.45 % 3.85 %(non-GAAP)^(1)(3) to totalearning assetsInterestbearing 59.46 % 64.00 % liabilities toearning assets (1) Computed on a tax-equivalent basis using an effective tax rate of 21%. (2) Nonaccrual loans and loans held for sale are included in the average loansoutstanding.(3) Refer to "Non-GAAP Measures" in this earnings release for additionalinformation on the usage and presentation of these non-GAAP measures, and referto these financial tables for the reconciliations to the most directlycomparable GAAP measures.

HEARTLAND FINANCIAL USA, INC.SELECTED FINANCIAL DATA - SUBSIDIARY BANKS (Unaudited)DOLLARS IN THOUSANDS As of and For the Quarter Ended 6/30/2021 3/31/2021 12/31/2020 9/30/2020 6/30/2020Total AssetsFirstBank & $ 2,882,969 $ 2,991,053 $ 3,171,961 $ 1,289,187 $ 1,256,710 TrustCitywide 2,611,842 2,632,199 2,628,963 2,639,516 2,546,942 BanksNewMexico 2,494,257 2,356,918 2,032,637 2,002,663 1,899,194 Bank &TrustDubuqueBank and 1,990,040 1,932,234 1,853,078 1,838,260 1,849,035 TrustCompanyIllinoisBank & 1,671,240 1,584,561 1,525,503 1,500,012 1,470,000 TrustArizonaBank & 1,645,816 1,614,740 1,529,800 1,039,253 970,775 TrustBank ofBlue 1,419,003 1,425,434 1,376,080 1,424,261 1,380,159 ValleyWisconsinBank & 1,252,096 1,264,009 1,267,488 1,262,069 1,203,108 TrustPremierValley 1,126,807 1,062,607 1,076,615 1,042,437 1,031,899 BankMinnesotaBank & 955,638 995,692 1,000,168 1,007,548 951,236 TrustRockyMountain 646,821 620,800 616,157 617,169 590,764 BankTotal DepositsFirstBank & $ 2,361,391 $ 2,427,920 $ 2,622,716 $ 936,366 $ 959,886 TrustCitywide 2,174,237 2,231,320 2,181,511 2,163,051 2,147,642 BanksNewMexico 2,195,838 2,077,304 1,749,963 1,747,527 1,698,584 Bank &TrustDubuqueBank and 1,471,564 1,565,782 1,456,908 1,591,561 1,496,559 TrustCompanyIllinoisBank & 1,512,106 1,426,426 1,338,677 1,307,513 1,318,866 TrustArizonaBank & 1,450,248 1,453,888 1,357,158 886,174 865,430 TrustBank ofBlue 1,168,617 1,178,114 1,138,264 1,142,910 1,138,818 ValleyWisconsinBank & 1,093,119 1,067,735 1,057,369 1,011,843 1,050,766 TrustPremierValley 963,459 896,715 836,984 855,913 869,165 BankMinnesotaBank & 762,549 813,693 789,555 804,045 820,199 TrustRockyMountain 568,961 549,894 538,012 533,429 519,029 Bank

HEARTLAND FINANCIAL USA, INC.CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA AND FULL TIME EQUIVALENT EMPLOYEEDATA For the Quarter Ended 6/30/2021 3/31/2021 12/31/2020 9/30/2020 6/30/2020Reconciliationof AnnualizedReturn onAverage TangibleCommon Equity(non-GAAP)Net incomeavailable tocommon $ 59,593 $ 50,801 $ 37,795 $ 45,521 $ 30,131 stockholders(GAAP)Plus coredeposit andcustomerrelationship 1,907 1,988 1,975 1,969 2,130 intangiblesamortization,net of tax^(1)Net incomeavailable tocommonstockholders $ 61,500 $ 52,789 $ 39,770 $ 47,490 $ 32,261 excludingintangibleamortization(non-GAAP) Average common $ 1,980,904 $ 1,963,674 $ 1,769,575 $ 1,661,381 $ 1,574,902 equity (GAAP)Less average 576,005 576,005 488,151 446,345 446,345 goodwillLess averagecore depositand customer 38,614 41,399 42,733 42,145 44,723 relationshipintangibles,netAveragetangible $ 1,366,285 $ 1,346,270 $ 1,238,691 $ 1,172,891 $ 1,083,834 common equity(non-GAAP)Annualizedreturn on 12.07 % 10.49 % 8.50 % 10.90 % 7.69 %average commonequity (GAAP)Annualizedreturn onaverage 18.05 % 15.90 % 12.77 % 16.11 % 11.97 %tangiblecommon equity(non-GAAP) Reconciliationof AnnualizedNet Interest Margin, FullyTax-Equivalent(non-GAAP)Net Interest $ 141,218 $ 139,605 $ 132,575 $ 122,497 $ 124,146 Income (GAAP)Plustax-equivalent 1,762 1,761 1,529 1,390 1,416 adjustment^(1)Net interestincome, fully $ 142,980 $ 141,366 $ 134,104 $ 123,887 $ 125,562 tax-equivalent(non-GAAP) Average $ 16,819,978 $ 16,460,124 $ 15,042,079 $ 13,868,360 $ 13,103,159 earning assets Annualized netinterest 3.37 % 3.44 % 3.51 % 3.51 % 3.81 %margin (GAAP)Annualized netinterestmargin, fully 3.41 3.48 3.55 3.55 3.85 tax-equivalent(non-GAAP)Net purchaseaccountingdiscountamortizationon loans 0.09 0.12 0.10 0.10 0.16 included inannualized netinterestmargin

Reconciliationof TangibleBook Value Per Common Share(non-GAAP)Common equity $ 2,049,081 $ 1,945,502 $ 1,968,526 $ 1,700,899 $ 1,636,672 (GAAP)Less goodwill 576,005 576,005 576,005 446,345 446,345 Less coredeposit andcustomer 37,452 39,867 42,383 40,520 43,011 relationshipintangibles,netTangiblecommon equity $ 1,435,624 $ 1,329,630 $ 1,350,138 $ 1,214,034 $ 1,147,316 (non-GAAP) Common sharesoutstanding, 42,245,452 42,173,675 42,093,862 36,885,390 36,844,744 net oftreasury stockCommon equity(book value) $ 48.50 $ 46.13 $ 46.77 $ 46.11 $ 44.42 per share(GAAP)Tangible bookvalue per $ 33.98 $ 31.53 $ 32.07 $ 32.91 $ 31.14 common share(non-GAAP) Reconciliationof TangibleCommon Equity Ratio(non-GAAP)Tangiblecommon equity $ 1,435,624 $ 1,329,630 $ 1,350,138 $ 1,214,034 $ 1,147,316 (non-GAAP) Total assets $ 18,371,006 $ 18,244,427 $ 17,908,339 $ 15,612,664 $ 15,026,153 (GAAP)Less goodwill 576,005 576,005 576,005 446,345 446,345 Less coredeposit andcustomer 37,452 39,867 42,383 40,520 43,011 relationshipintangibles,netTotal tangibleassets $ 17,757,549 $ 17,628,555 $ 17,289,951 $ 15,125,799 $ 14,536,797 (non-GAAP)Tangiblecommon equity 8.08 % 7.54 % 7.81 % 8.03 % 7.89 %ratio(non-GAAP) (1) Computed on a tax-equivalent basis using an effective tax rate of 21%.

HEARTLAND FINANCIAL USA, INC.CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATAReconciliationof Efficiency For the Quarter EndedRatio(non-GAAP) 6/30/2021 3/31/2021 12/31/2020 9/30/2020 6/30/2020

Net interest $ 141,218 $ 139,605 $ 132,575 $ 122,497 $ 124,146 income (GAAP)Tax-equivalent 1,762 1,761 1,529 1,390 1,416 adjustment^(1)Fullytax-equivalent 142,980 141,366 134,104 123,887 125,562 net interestincomeNoninterest 33,164 30,317 32,621 31,216 30,637 incomeSecurities(gains)/ (2,842 ) 30 (2,829 ) (1,300 ) (2,006 )losses, netUnrealized(gain)/loss onequity (83 ) 110 (36 ) (155 ) (680 )securities,netValuationadjustment on 526 (917 ) 102 120 (9 )servicingrightsAdjustedrevenue $ 173,745 $ 170,906 $ 163,962 $ 153,768 $ 153,504 (non-GAAP) Totalnoninterest $ 103,376 $ 102,423 $ 99,269 $ 90,396 $ 90,439 expenses(GAAP)Less: Core depositand customerrelationship 2,415 2,516 2,501 2,492 2,696 intangiblesamortizationPartnershipinvestment in 1,345 35 1,899 927 791 tax creditprojectsLoss on sales/valuation of 183 194 2,621 1,763 701 assets, netAcquisition,integrationand 210 2,928 2,186 1,146 673 restructuringcostsAdjustednoninterest $ 99,223 $ 96,750 $ 90,062 $ 84,068 $ 85,578 expenses(non-GAAP)Efficiencyratio, fully 57.11 % 56.61 % 54.93 % 54.67 % 55.75 %tax-equivalent(non-GAAP) Acquisition,integrationand restructuringcostsSalaries andemployee $ 44 $ 534 $ 232 $ ? $ 122 benefitsOccupancy 1 9 ? ? ? Furniture and 41 607 423 496 15 equipmentProfessional 63 670 1,422 476 505 feesAdvertising 6 156 42 8 4 Othernoninterest 55 952 67 166 27 expensesTotalacquisition,integration $ 210 $ 2,928 $ 2,186 $ 1,146 $ 673 andrestructuringcostsAfter taximpact ondiluted $ ? $ 0.05 $ 0.04 $ 0.02 $ 0.01 earnings percommon share^(1) (1) Computed on a tax-equivalent basis using an effective tax rate of 21%.

HEARTLAND FINANCIAL USA, INC.CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA For the Quarter Ended For the Six Months Ended June 30, June 30, 2021 2020 2021 2020Reconciliationof AnnualizedReturn onAverage TangibleCommon Equity(non-GAAP)Net incomeavailable tocommon $ 59,593 $ 30,131 $ 110,394 $ 50,171 stockholders(GAAP)Plus coredeposit andcustomerrelationship 1,907 2,130 3,895 4,485 intangiblesamortization,net of tax^(1)Net incomeavailable tocommonstockholders $ 61,500 $ 32,261 $ 114,289 $ 54,656 excludingintangibleamortization(non-GAAP) Average common $ 1,980,904 $ 1,574,902 $ 1,972,337 $ 1,597,292 equity (GAAP)Less average 576,005 446,345 576,005 446,345 goodwillLess averagecore depositand customer 38,614 44,723 39,999 46,177 relationshipintangibles,netAveragetangible $ 1,366,285 $ 1,083,834 $ 1,356,333 $ 1,104,770 common equity(non-GAAP)Annualizedreturn on 12.07 % 7.69 % 11.29 % 6.32 %average commonequity (GAAP)Annualizedreturn onaverage 18.05 % 11.97 % 16.99 % 9.95 %tangiblecommon equity(non-GAAP) Reconciliationof AnnualizedNet Interest Margin, FullyTax-Equivalent(non-GAAP)Net Interest $ 141,218 $ 124,146 $ 280,823 $ 236,657 Income (GAAP)Plustax-equivalent 1,762 1,416 3,523 2,547 adjustment^(1)Net interestincome, fully $ 142,980 $ 125,562 $ 284,346 $ 239,204 tax-equivalent(non-GAAP) Average $ 16,819,978 $ 13,103,159 $ 16,641,045 $ 12,497,307 earning assets Annualized netinterest 3.37 % 3.81 % 3.40 % 3.81 %margin (GAAP)Annualized netinterestmargin, fully 3.41 3.85 3.45 3.85 tax-equivalent(non-GAAP)Purchaseaccountingdiscountamortizationon loans 0.09 0.16 0.11 0.10 included inannualized netinterestmargin (1) Computed on a tax-equivalent basis using an effective tax rate of 21%.

HEARTLAND FINANCIAL USA, INC.CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATAReconciliation of For the Quarter Ended For the Six Months EndedEfficiency Ratio June 30, June 30,(non-GAAP) 2021 2020 2021 2020

Net interest income $ 141,218 $ 124,146 $ 280,823 $ 236,657 (GAAP)Tax-equivalent adjustment 1,762 1,416 3,523 2,547 ^(1)Fully tax-equivalent net 142,980 125,562 284,346 239,204 interest incomeNoninterest income 33,164 30,637 63,481 56,454 Securities gains, net (2,842 ) (2,006 ) (2,812 ) (3,664 )Unrealized (gain)/loss on (83 ) (680 ) 27 (449 )equity securities, netValuation adjustment on 526 (9 ) (391 ) 1,556 servicing rightsAdjusted revenue $ 173,745 $ 153,504 $ 344,651 $ 293,101 (non-GAAP) Total noninterest $ 103,376 $ 90,439 $ 205,799 $ 181,298 expenses (GAAP)Less: Core deposit and customerrelationship intangibles 2,415 2,696 4,931 5,677 amortizationPartnership investment in 1,345 791 1,380 975 tax credit projectsLoss on sales/valuation 183 701 377 717 of assets, netAcquisition, integration 210 673 3,138 2,049 and restructuring costsAdjusted noninterest $ 99,223 $ 85,578 $ 195,973 $ 171,880 expenses (non-GAAP)Efficiency ratio, fully 57.11 % 55.75 % 56.86 % 58.64 %tax-equivalent (non-GAAP) Acquisition, integration and restructuring costsSalaries and employee $ 44 $ 122 $ 578 $ 166 benefitsOccupancy 1 ? 10 ? Furniture and equipment 41 15 648 39 Professional fees 63 505 733 1,501 Advertising 6 4 162 93 Other noninterest 55 27 1,007 250 expensesTotal acquisition,integration and $ 210 $ 673 $ 3,138 $ 2,049 restructuring costsAfter tax impact ondiluted earnings per $ ? $ 0.01 $ 0.06 $ 0.04 common share^(1)

(1) Computed on a tax-equivalent basis using an effective tax rate of 21%.

HEARTLAND FINANCIAL USA, INC.CONSOLIDATED FINANCIAL HIGHLIGHTS (Unaudited)DOLLARS IN THOUSANDS, EXCEPT PER SHARE DATA AND FULL TIME EQUIVALENT EMPLOYEEDATA As of and For the Quarter Ended 6/30/2021 3/31/2021 12/31/2020 9/30/2020 6/30/2020PPP I loan $ 374,174 $ 739,562 $ 957,785 $ 1,128,035 $ 1,124,430 balancesAverage PPP I 597,703 841,262 1,064,863 1,128,488 916,405 loan balances PPP I fee $ 7,313 $ 7,464 $ 9,109 $ 4,542 $ 3,655 incomePPP I interest 1,445 2,087 2,697 2,920 2,362 incomeTotal PPP Iinterest $ 8,758 $ 9,551 $ 11,806 $ 7,462 $ 6,017 income PPP II loan $ 455,001 $ 415,766 $ ? $ ? $ ? balancesAverage PPP II 449,856 151,255 ? ? ? loan balances PPP II fee $ 1,263 $ 223 $ ? $ ? $ ? incomePPP IIinterest 1,165 375 ? ? ? incomeTotal PPP IIinterest $ 2,428 $ 598 $ ? $ ? $ ? income Selectedratiosexcludingtotal PPP loans andtotal PPPinterestincomeAnnualized netinterest 3.31 % 3.39 % 3.44 % 3.59 % 3.90 %margin (GAAP)Annualized netinterestmargin, fully 3.35 3.44 3.48 3.64 3.95 tax-equivalent(non-GAAP)^(1)Ratio ofnonperforming 0.93 1.03 0.97 1.01 1.14 loans to totalloansRatio ofnonperformingloans andperforming 0.95 1.06 1.00 1.16 1.18 trouble debtrestructuredloans to totalloansRatio ofnonperforming 0.52 0.58 0.56 0.59 0.71 assets tototal assetsAnnualizedratio of netloan 0.13 0.07 0.01 1.05 0.12 charge-offs toaverage loansAllowance forloan creditlosses as a 1.31 1.46 1.45 1.30 1.48 percent ofloansAllowance forlendingrelated credit 1.47 1.63 1.62 1.48 1.69 losses as apercent ofloansLoansdelinquent30-89 days as 0.18 0.18 0.25 0.19 0.26 a percent oftotal loansAfter taximpact oftotal PPPinterestincome on $ 0.21 $ 0.19 $ 0.24 $ 0.16 $ 0.13 dilutedearnings percommon share^(1)

As of and For the Six Months Ended June 30, June 30, 2021 2020Average PPP I loan balances $ 718,810 $ 458,202 Average PPP II loan balances 301,380 ? PPP I and II fee income $ 16,263 $ 3,655 PPP I and II interest income 5,072 2,362 Total PPP I and II interest income $ 21,335 $ 6,017 Selected ratios excluding total PPP loans and total PPP interest incomeAnnualized net interest margin (GAAP) 3.35 % 3.85 %Annualized net interest margin, fully tax-equivalent 3.40 3.90 (non-GAAP)^(1)Annualized ratio of net loan charge-offs to average 0.10 0.18 loans After tax impact of total PPP interest income on $ 0.40 $ 0.13 diluted earnings per common share^(1) (1) Computed on a tax-equivalent basis using an effective tax rate of 21%.