GlobeNewswire Inc | Jul 26, 2021 04:15PM EDT

July 26, 2021

NEWARK, Ohio, July 26, 2021 (GLOBE NEWSWIRE) -- Park National Corporation (Park) (NYSE American: PRK) today reported financial results for the second quarter and first half of 2021 (three and six months ended June 30, 2021). Park's board of directors declared a quarterly cash dividend of $1.03 per common share, payable on September 10, 2021 to common shareholders of record as of August 20, 2021.

Parks net income for the second quarter of 2021 was $39.1 million, a 32.6 percent increase from $29.5 million for the second quarter of 2020. Second quarter 2021 net income per diluted common share was $2.38, compared to $1.80 in the second quarter of 2020. Park's net income for the first half of 2021 was $82.0 million, a 58.0 percent increase from $51.9 million for the first half of 2020. Net income per diluted common share was $4.98 for the first half of 2021, compared to $3.16 for the first half of 2020. Various governmental programs and economic conditions continue to affect performance reports throughout the financial industry.

Our positive results reflect the dedication of our associates, whove been unwavering in serving our clients throughout the ups and downs of the past year. From lending to digital services to philanthropic support we do not take lightly the trust our communities place in Park National Bank, Park Chairman David Trautman said. We remain focused on delivering on our promises to local families and businesses.

Park's community-banking subsidiary, The Park National Bank, reported net income of $40.9 million for the second quarter of 2021, a 33.0 percent increase compared to $30.8 million for the same period of 2020. Park National Bank reported net income of $86.0 million for the first half of 2021, compared to $56.7 million for the first half of 2020. Park National Bank's mortgage origination volume for the first half of 2021 was $561 million; whereas, it was $527 million for the first half of 2020.

Parks board also recognized the retirement of C. Daniel DeLawder, thanking him for his 50 years of service and leadership with the Park National organization. DeLawder, a former chairman and chief executive officer for Park, retired from employment on June 30, 2021. He will remain on the boards of directors for the Park National Corporation and Park National Bank; and will continue to serve as chair of the executive committee for the corporation and chair of Park National Banks trust committee until his term expires in 2023.

Headquartered in Newark, Ohio, Park National Corporation has $9.9 billion in total assets (as of June 30, 2021). Park's banking operations are conducted through its subsidiary The Park National Bank. Other Park subsidiaries are Scope Leasing, Inc. (d.b.a. Scope Aircraft Finance), Guardian Financial Services Company (d.b.a. Guardian Finance Company) and SE Property Holdings, LLC.

Complete financial tables are listed below.

Category: EarningsMedia contact: Bethany Lewis, 740.349.0421, bethany.lewis@parknationalbank.comInvestor contact: Brady Burt, 740.322.6844, brady.burt@parknationalbank.comPark National Corporation, 50 N. Third Street, Newark, Ohio 43055

SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995Park cautions that any forward-looking statements contained in this news release or made by management of Park are provided to assist in the understanding of anticipated future financial performance. Forward-looking statements provide current expectations or forecasts of future events and are not guarantees of future performance.The forward-looking statements are based on managements expectations and are subject to a number of risks and uncertainties. Although management believes that the expectations reflected in such forward-looking statements are reasonable, actual results may differ materially from those expressed or implied in such statements.

Risks and uncertainties that could cause actual results to differ materially include, without limitation:

-- the ever-changing effects of the novel coronavirus (COVID-19) pandemic - - the duration, extent and severity of which are impossible to predict, including the possibility of further resurgence in the spread of COVID-19 - - on economies (local, national and international) and markets, and on our customers, counterparties, employees and third-party service providers, as well as the effects of various responses of governmental and nongovernmental authorities to the COVID-19 pandemic, including public health actions directed toward the containment of the COVID-19 pandemic (such as quarantines, shut downs and other restrictions on travel and commercial, social or other activities), the development, availability and effectiveness of vaccines, and the implementation of fiscal stimulus packages; -- the impact of future governmental and regulatory actions upon our participation in and execution of government programs related to the COVID-19 pandemic; -- Park's ability to execute our business plan successfully and within the expected timeframe as well as our ability to manage strategic initiatives in light of the impact of the COVID-19 pandemic and the various responses to the COVID-19 pandemic; -- general economic and financial market conditions, specifically in the real estate markets and the credit markets, either nationally or in the states in which Park and our subsidiaries do business, may experience a weaker recovery than anticipated, in addition to the continuing impact of the COVID-19 pandemic on our customers operations and financial condition, either of which may result in adverse impacts on the demand for loan, deposit and other financial services, delinquencies, defaults and counterparties' inability to meet credit and other obligations and the possible impairment of collectability of loans; -- factors that can impact the performance of our loan portfolio, including real estate values and liquidity in our primary market areas, the financial health of our commercial borrowers and the success of construction projects that we finance, including any loans acquired in acquisition transactions; -- the effect of monetary and other fiscal policies (including the impact of money supply and interest rate policies of the Federal Reserve Board) as well as disruption in the liquidity and functioning of U.S. financial markets, as a result of the COVID-19 pandemic and government policies implemented in response thereto, may adversely impact prepayment penalty income, mortgage banking income, income from fiduciary activities, the value of securities, deposits and other financial instruments, in addition to the loan demand and the performance of our loan portfolio, and the interest rate sensitivity of our consolidated balance sheet as well as reduce interest margins; -- changes in the federal, state, or local tax laws may negatively impact our financial performance. On March 31, 2021, President Biden unveiled his infrastructure plan, which includes a proposal to increase the federal corporate tax rate from 21% to 28% as part of a package of tax reforms to help fund the spending proposals in the plan. The Biden plan is in the early stages of the legislative process, which is expected to proceed this year due to the Democratic Party's majority in both houses of Congress. If adopted as proposed, the increase of the corporate tax rate would adversely affect our results of operations in future periods. -- changes in consumer spending, borrowing and saving habits, whether due to changes in retail distribution strategies, consumer preferences and behavior, changes in business and economic conditions (including as a result of the COVID-19 pandemic and reactions thereto), legislative and regulatory initiatives (including those undertaken in response to the COVID-19 pandemic), or other factors may be different than anticipated; -- changes in unemployment levels in the states in which Park and our subsidiaries do business may be different than anticipated due to the continuing impact of the COVID-19 pandemic; -- changes in customers', suppliers', and other counterparties' performance and creditworthiness may be different than anticipated due to the continuing impact of and the various responses to the COVID-19 pandemic; -- Park may have more credit risk and higher credit losses to the extent there are loan concentrations by location or industry of borrowers or collateral; -- the volatility from quarter to quarter of mortgage banking income, whether due to interest rates, demand, the fair value of mortgage loans, or other factors; -- the adequacy of our internal controls and risk management program in the event of changes in the market, economic, operational (including those which may result from more of our associates working remotely), asset/liability repricing, legal, compliance, strategic, cybersecurity, liquidity, credit and interest rate risks associated with Park's business; -- competitive pressures among financial services organizations could increase significantly, including product and pricing pressures (which could in turn impact our credit spreads), changes to third-party relationships and revenues, changes in the manner of providing services, customer acquisition and retention pressures, and our ability to attract, develop and retain qualified banking professionals; -- uncertainty regarding the nature, timing, cost and effect of changes in banking regulations or other regulatory or legislative requirements affecting the respective businesses of Park and our subsidiaries, including major reform of the regulatory oversight structure of the financial services industry and changes in laws and regulations concerning taxes, FDIC insurance premium levels, pensions, bankruptcy, consumer protection, rent regulation and housing, financial accounting and reporting, environmental protection, insurance, bank products and services, bank and bank holding company capital and liquidity standards, fiduciary standards, securities and other aspects of the financial services industry, specifically the reforms provided for in the Coronavirus Aid, Relief and Economic Security (CARES) Act and the follow-up legislation in the Consolidated Appropriations Act, 2021, the American Rescue Plan Act of 2021, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the Dodd-Frank Act) and the Basel III regulatory capital reforms, as well as regulations already adopted and which may be adopted in the future by the relevant regulatory agencies, including the Consumer Financial Protection Bureau, the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation, and the Federal Reserve Board, to implement the provisions of the CARES Act and the follow-up legislation in the Consolidated Appropriations Act, 2021, the provisions of the American Rescue Plan Act of 2021, the provisions of the Dodd-Frank Act, and the Basel III regulatory capital reforms; -- the effect of changes in accounting policies and practices, as may be adopted by the Financial Accounting Standards Board (the "FASB"), the SEC, the Public Company Accounting Oversight Board and other regulatory agencies, may adversely affect Park's reported financial condition or results of operations; -- Park's assumptions and estimates used in applying critical accounting policies and modeling, including under the CECL model, which may prove unreliable, inaccurate or not predictive of actual results; -- significant changes in the tax laws, which may adversely affect the fair values of net deferred tax assets and obligations of state and political subdivisions held in Park's investment securities portfolio; -- the impact of Park's ability to anticipate and respond to technological changes on Park's ability to respond to customer needs and meet competitive demands; -- operational issues stemming from and/or capital spending necessitated by the potential need to adapt to industry changes in information technology systems on which Park and our subsidiaries are highly dependent; -- the ability to secure confidential information and deliver products and services through the use of computer systems and telecommunications networks, including those of Park's third-party vendors and other service providers, which may prove inadequate, and could adversely affect customer confidence in Park and/or result in Park incurring a financial loss; -- a failure in or breach of Park's operational or security systems or infrastructure, or those of our third-party vendors and other service providers, resulting in failures or disruptions in customer account management, general ledger, deposit, loan, or other systems, including as a result of cyber attacks; -- the existence or exacerbation of general geopolitical instability and uncertainty as well as the effect of trade policies (including the impact of potential or imposed tariffs, a U.S. withdrawal from or significant renegotiation of trade agreements, trade wars and other changes in trade regulations and changes in the relationship of the U.S. and its global trading partners); -- uncertainty regarding the impact of changes to the U.S. presidential administration and Congress on the regulatory landscape, capital markets, elevated U.S. government debt, potential changes in tax legislation that may increase tax rates and the response to and management of the COVID-19 pandemic; -- the impact on financial markets and the economy of any changes in the credit ratings of the U.S. Treasury obligations and other U.S. government-backed debt, as well as issues surrounding the levels of U.S., European and Asian government debt and concerns regarding the growth rates and financial stability of certain sovereign governments, supranationals and financial institutions in Europe and Asia and the risk they may face difficulties servicing their sovereign debt; -- our litigation and regulatory compliance exposure, including the costs and effects of any adverse developments in legal proceedings or other claims and the costs and effects of unfavorable resolution of regulatory and other governmental examinations or other inquiries; -- continued availability of earnings and excess capital sufficient for the lawful and prudent declaration of dividends; -- the impact on Park's business, personnel, facilities or systems of losses related to acts of fraud, scams and schemes of third parties; -- the impact of widespread natural and other disasters, pandemics (including the COVID-19 pandemic), dislocations, regional or national protests and civil unrest (including any resulting branch closures or damages), military or terrorist activities or international hostilities on the economy and financial markets generally and on us or our counterparties specifically; -- any of the foregoing factors, or other cascading effects of the COVID-19 pandemic that are not currently foreseeable, could materially affect our business, including our customers' willingness to conduct banking transactions and their ability to pay on existing obligations; -- the effect of healthcare laws in the U.S. and potential changes for such laws, especially in light of the COVID-19 pandemic, which may increase our healthcare and other costs and negatively impact our operations and financial results; -- risk and uncertainties associated with Park's entry into new geographic markets with our recent acquisitions, including expected revenue synergies and cost savings from recent acquisitions not being fully realized or realized within the expected time frame; -- the discontinuation of the London Inter-Bank Offered Rate (LIBOR) and other reference rates which may result in increased expenses and litigation, and adversely impact the effectiveness of hedging strategies; -- and other risk factors relating to the banking industry as detailed from time to time in Park's reports filed with the SEC including those described in "Item 1A. Risk Factors" of Part I of Park's Annual Report on Form 10-K for the fiscal year ended December 31, 2020.

Park does not undertake, and specifically disclaims any obligation, to publicly release the results of any revisions that may be made to update any forward-looking statement to reflect the events or circumstances after the date on which the forward-looking statement was made, or reflect the occurrence of unanticipated events, except to the extent required by law.

PARK NATIONAL CORPORATIONFinancial HighlightsAs of or for the three monthsended June 30, 2021, March 31, 2021, and June 30, 2020 2021 2021 2020 Percent change vs.(in thousands,except share and 2nd QTR 1st QTR 2nd QTR 1Q '21 2Q '20per share data)INCOME STATEMENT:Net interest $ 83,851 $ 80,734 $ 81,186 3.9 % 3.3 %income(Recovery of)provision for (4,040 ) (4,855 ) 12,224 (16.8 ) % N.Mcredit losses(l)Other income 31,238 34,089 30,964 (8.4 ) % 0.9 %Other expense 71,400 67,865 64,799 5.2 % 10.2 %Income before $ 47,729 $ 51,813 $ 35,127 (7.9 ) % 35.9 %income taxesIncome taxes 8,597 8,982 5,622 (4.3 ) % 52.9 %Net income $ 39,132 $ 42,831 $ 29,505 (8.6 ) % 32.6 % MARKET DATA: Earnings percommon share - $ 2.39 $ 2.63 $ 1.81 (9.1 ) % 32.0 %basic (a)Earnings percommon share - 2.38 2.61 1.80 (8.8 ) % 32.2 %diluted (a)Cash dividendsdeclared per 1.03 1.23 1.02 (16.3 ) % 1.0 %common shareBook value percommon share at 65.44 63.74 61.46 2.7 % 6.5 %period endMarket price percommon share at 117.42 129.30 70.38 (9.2 ) % 66.8 %period endMarketcapitalization 1,918,733 2,112,238 1,146,942 (9.2 ) % 67.3 %at period end Weighted averagecommon shares - 16,340,690 16,314,987 16,296,427 0.2 % 0.3 %basic (b)Weighted averagecommon shares - 16,472,800 16,439,920 16,375,434 0.2 % 0.6 %diluted (b)Common sharesoutstanding at 16,340,772 16,335,951 16,296,425 ? % 0.3 %period end PERFORMANCERATIOS: (annualized)Return onaverage assets 1.59 % 1.81 % 1.26 % (12.2 ) % 26.2 %(a)(b)Return onaverage 14.81 % 16.63 % 11.89 % (10.9 ) % 24.6 %shareholders'equity (a)(b)Yield on loans 4.60 % 4.48 % 4.63 % 2.7 % (0.6 ) %Yield oninvestment 2.31 % 2.53 % 2.76 % (8.7 ) % (16.3 ) %securitiesYield on moneymarket 0.10 % 0.11 % 0.10 % (9.1 ) % ? %instrumentsYield oninterest earning 3.93 % 3.96 % 4.14 % (0.8 ) % (5.1 ) %assetsCost of interest 0.13 % 0.16 % 0.36 % (18.8 ) % (63.9 ) %bearing depositsCost of 1.91 % 1.86 % 1.33 % 2.7 % 43.6 %borrowingsCost of payinginterest bearing 0.29 % 0.32 % 0.43 % (9.4 ) % (32.6 ) %liabilitiesNet interest 3.74 % 3.76 % 3.84 % (0.5 ) % (2.6 ) %margin (g)Efficiency ratio 61.65 % 58.74 % 57.41 % 5.0 % 7.4 %(g) OTHER RATIOS (NON-GAAP):Tangible bookvalue per share $ 55.17 $ 53.43 $ 51.04 3.3 % 8.1 %(d) Note:Explanations forfootnotes (a) -(l) are includedat the end of the financialtables in the"FinancialReconciliations"section. PARK NATIONAL CORPORATIONFinancial Highlights (continued)As of or for the three monthsended June 30, 2021, March 31, 2021, and June 30, 2020 Percent change vs.(in thousands, June 30, 2021 March 31, 2021 June 30, 2020 1Q '21 2Q '20except ratios)BALANCE SHEET: Investment $ 1,461,916 $ 1,176,240 $ 1,153,186 24.3 % 26.8 %securitiesLoans 7,035,646 7,168,745 7,204,445 (1.9 ) % (2.3 ) %Allowance forcredit losses 83,577 86,886 73,476 (3.8 ) % 13.7 %(l)Goodwill andother intangible 167,897 168,376 169,905 (0.3 ) % (1.2 ) %assetsOther realestate owned 813 844 1,356 (3.7 ) % (40.0 ) %(OREO)Total assets 9,947,994 9,914,069 9,712,994 0.3 % 2.4 %Total deposits 8,214,624 8,236,199 8,161,900 (0.3 ) % 0.6 %Borrowings 501,350 523,266 444,410 (4.2 ) % 12.8 %Totalshareholders' 1,069,392 1,041,271 1,001,594 2.7 % 6.8 %equityTangible equity 901,495 872,895 831,689 3.3 % 8.4 %(d)Totalnonperforming 114,695 130,327 126,044 (12.0 ) % (9.0 ) %loansTotalnonperforming 118,672 134,335 130,999 (11.7 ) % (9.4 ) %assets ASSET QUALITY RATIOS:Loans as a % ofperiod end total 70.72 % 72.31 % 74.17 % (2.2 ) % (4.7 ) %assetsTotalnonperforming 1.63 % 1.82 % 1.75 % (10.4 ) % (6.9 ) %loans as a % ofperiod end loansTotalnonperformingassets as a % ofperiod end loans 1.69 % 1.87 % 1.82 % (9.6 ) % (7.1 ) %+ OREO+ othernonperformingassetsAllowance forcredit losses as 1.19 % 1.21 % 1.02 % (1.7 ) % 16.7 %a % of periodend loansNet loan(recoveries) $ (731 ) $ 24 $ 251 N.M N.Mcharge-offsAnnualized netloan(recoveries) (0.04 ) % ? % 0.01 % N.M N.Mcharge-offs as a% of averageloans (b) CAPITAL & LIQUIDITY:Totalshareholders' 10.75 % 10.50 % 10.31 % 2.4 % 4.3 %equity / Periodend total assetsTangible equity(d) / Tangible 9.22 % 8.96 % 8.72 % 2.9 % 5.7 %assets (f)Averageshareholders' 10.74 % 10.87 % 10.61 % (1.2 ) % 1.2 %equity / Averageassets (b)Averageshareholders' 14.94 % 14.63 % 14.30 % 2.1 % 4.5 %equity / Averageloans (b)Average loans /Average deposits 86.49 % 90.12 % 88.59 % (4.0 ) % (2.4 ) %(b) Note: Explanations for footnotes (a) - (l) are included at theend of the financial tables in the "Financial Reconciliations" section.

PARK NATIONAL CORPORATIONFinancial HighlightsSix months ended June 30, 2021 and June 30, 2020 2021 2020 (in thousands, except Six months Six months Percentshare and per share ended June 30 ended June 30 changedata) vs '20INCOME STATEMENT: Net interest income $ 164,585 $ 157,469 4.5 %(Recovery of) provision (8,895 ) 17,377 N.Mfor credit losses (l)Other income 65,327 53,450 22.2 %Other expense 139,265 131,075 6.2 %Income before income $ 99,542 $ 62,467 59.4 %taxesIncome taxes 17,579 10,590 66.0 %Net income $ 81,963 $ 51,877 58.0 % MARKET DATA: Earnings per common $ 5.02 $ 3.18 57.9 %share - basic (a)Earnings per common 4.98 3.16 57.6 %share - diluted (a)Cash dividends declared 2.26 2.24 0.9 %per common share Weighted average common 16,327,838 16,300,015 0.2 %shares - basic (b)Weighted average common 16,455,673 16,400,657 0.3 %shares - diluted (b) PERFORMANCE RATIOS: (annualized)Return on average assets 1.70 % 1.15 % 47.8 %(a)(b)Return on averageshareholders' equity (a) 15.71 % 10.54 % 49.1 %(b)Yield on loans 4.54 % 4.81 % (5.6 ) %Yield on investment 2.41 % 2.76 % (12.7 ) %securitiesYield on money market 0.10 % 0.38 % (73.7 ) %instrumentsYield on interest 3.95 % 4.35 % (9.2 ) %earning assetsCost of interest bearing 0.14 % 0.58 % (75.9 ) %depositsCost of borrowings 1.89 % 1.69 % 11.8 %Cost of paying interest 0.30 % 0.66 % (54.5 ) %bearing liabilitiesNet interest margin (g) 3.75 % 3.89 % (3.6 ) %Efficiency ratio (g) 60.20 % 61.72 % (2.5 ) % ASSET QUALITY RATIOS Net loan (recoveries) $ (707 ) $ 580 N.M.charge-offsNet loan (recoveries)charge-offs as a % of (0.02 ) % 0.02 % N.M.average loans (b) CAPITAL & LIQUIDITY Average shareholders'equity / Average assets 10.80 % 10.95 % (1.4 ) %(b)Average shareholders'equity / Average loans 14.79 % 14.71 % 0.5 %(b)Average loans / Average 88.26 % 89.21 % (1.1 ) %deposits (b) Note: Explanations forfootnotes (a) - (l) areincluded at the end ofthe financial tables in the "FinancialReconciliations"section.

PARK NATIONAL CORPORATION Consolidated Statements of Income Three Months Ended Six Months Ended June 30, June 30, (inthousands,except share 2021 2020 2021 2020 and pershare data) Interest income:Interest andfees on $ 81,176 $ 80,155 $ 159,913 $ 160,842 loansInterest on: Obligationsof U.S. Government,its agenciesand othersecurities - 4,600 5,026 8,856 10,557 taxableObligationsof statesand 2,032 2,151 4,069 4,351 politicalsubdivisions- tax-exemptOtherinterest 186 113 329 604 incomeTotalinterest 87,994 87,445 173,167 176,354 income Interest expense:Interest on deposits:Demand andsavings 401 1,507 787 7,849 depositsTime 1,285 3,346 2,869 7,631 depositsInterest on 2,457 1,406 4,926 3,405 borrowingsTotalinterest 4,143 6,259 8,582 18,885 expense Net interest 83,851 81,186 164,585 157,469 income (Recoveryof)provision (4,040 ) 12,224 (8,895 ) 17,377 for creditlosses (l) Net interestincome after(recoveryof) 87,891 68,962 173,480 140,092 provisionfor creditlosses Other income 31,238 30,964 65,327 53,450 Other 71,400 64,799 139,265 131,075 expense Incomebefore 47,729 35,127 99,542 62,467 income taxes Income taxes 8,597 5,622 17,579 10,590 Net income $ 39,132 $ 29,505 $ 81,963 $ 51,877 Per common share:Net income - $ 2.39 $ 1.81 $ 5.02 $ 3.18 basicNet income - $ 2.38 $ 1.80 $ 4.98 $ 3.16 diluted Weightedaverage 16,340,690 16,296,427 16,327,838 16,300,015 shares -basicWeightedaverage 16,472,800 16,375,434 16,455,673 16,400,657 shares -diluted Cashdividends $ 1.03 $ 1.02 $ 2.26 $ 2.24 declared

PARK NATIONAL CORPORATIONConsolidated Balance Sheets (in thousands, except share data) June 30, 2021 December 31, 2020 Assets Cash and due from banks $ 134,182 $ 155,596 Money market instruments 673,242 214,878 Investment securities 1,461,916 1,124,806 Loans 7,035,646 7,177,785 Allowance for credit losses (l) (83,577 ) (85,675 ) Loans, net 6,952,069 7,092,110 Bank premises and equipment, net 89,570 88,660 Goodwill and other intangible assets 167,897 168,855 Other real estate owned 813 1,431 Other assets 468,305 432,685 Total assets $ 9,947,994 $ 9,279,021 Liabilities and Shareholders' Equity Deposits: Noninterest bearing $ 2,876,110 $ 2,727,100 Interest bearing 5,338,514 4,845,258 Total deposits 8,214,624 7,572,358 Borrowings 501,350 562,504 Other liabilities 162,628 103,903 Total liabilities $ 8,878,602 $ 8,238,765 Shareholders' Equity: Preferred shares (200,000 shares authorized;no shares outstanding at June 30, 2021 and $ ? $ ? December 31, 2020)Common shares (No par value; 20,000,000shares authorized;17,623,143 shares issued 459,276 460,687 at June 30, 2021 and 17,623,163 shares issuedat December 31, 2020)Accumulated other comprehensive (loss) (2,930 ) 5,571 income, net of taxesRetained earnings 741,155 704,764 Treasury shares (1,282,371 shares at June 30,2021 and 1,308,966 shares at December 31, (128,109 ) (130,766 ) 2020)Total shareholders' equity $ 1,069,392 $ 1,040,256 Total liabilities and shareholders' equity $ 9,947,994 $ 9,279,021

PARK NATIONAL CORPORATION Consolidated Average Balance Sheets Three Months Ended Six Months Ended June 30, June 30,(in 2021 2020 2021 2020thousands) Assets Cash and due $ 131,397 $ 134,386 $ 139,784 $ 133,208 from banksMoney market 720,238 461,055 637,531 318,930 instrumentsInvestment 1,307,037 1,197,445 1,234,178 1,230,948 securitiesLoans 7,094,099 6,981,783 7,116,353 6,731,960 Allowance forcredit losses (87,083 ) (62,387 ) (88,511 ) (60,001 ) (l)Loans, net 7,007,016 6,919,396 7,027,842 6,671,959 Bank premisesand 90,269 80,096 90,006 77,509 equipment,netGoodwill andother 168,211 170,303 168,449 170,606 intangibleassetsOther real 822 2,765 1,016 3,282 estate ownedOther assets 447,088 442,819 444,221 437,585 Total assets $ 9,872,078 $ 9,408,265 $ 9,743,027 $ 9,044,027 Liabilitiesand Shareholders'Equity Deposits: Noninterest $ 2,940,602 $ 2,400,809 $ 2,866,909 $ 2,175,400 bearingInterest 5,261,608 5,480,366 5,195,848 5,370,376 bearingTotal 8,202,210 7,881,175 8,062,757 7,545,776 depositsBorrowings 514,855 425,349 526,715 405,930 Other 95,064 103,453 101,332 102,189 liabilitiesTotal $ 8,812,129 $ 8,409,977 $ 8,690,804 $ 8,053,895 liabilities Shareholders' Equity:Preferred $ ? $ ? $ ? $ ? sharesCommon shares 457,949 456,830 459,327 458,146 Accumulatedothercomprehensive (4,876 ) 10,756 (1,865 ) 5,331 (loss)income, netof taxesRetained 734,993 663,290 724,183 658,877 earningsTreasury (128,117 ) (132,588 ) (129,422 ) (132,222 ) sharesTotalshareholders' $ 1,059,949 $ 998,288 $ 1,052,223 $ 990,132 equityTotalliabilitiesand $ 9,872,078 $ 9,408,265 $ 9,743,027 $ 9,044,027 shareholders'equity

PARK NATIONAL CORPORATIONConsolidated Statements of Income - Linked Quarters 2021 2021 2020 2020 2020(inthousands, 2nd QTR 1st QTR 4th QTR 3rd QTR 2nd QTRexcept pershare data) Interest income:Interest andfees on $ 81,176 $ 78,737 $ 85,268 $ 82,617 $ 80,155 loansInterest on: Obligationsof U.S.Government,its agencies 4,600 4,256 4,420 4,841 5,026 and othersecurities -taxableObligationsof statesand 2,032 2,037 2,040 2,045 2,151 politicalsubdivisions- tax-exemptOtherinterest 186 143 72 63 113 incomeTotalinterest 87,994 85,173 91,800 89,566 87,445 income Interest expense:Interest on deposits:Demand andsavings 401 386 490 803 1,507 depositsTime 1,285 1,584 1,893 2,662 3,346 depositsInterest on 2,457 2,469 3,096 2,261 1,406 borrowingsTotalinterest 4,143 4,439 5,479 5,726 6,259 expense Net interest 83,851 80,734 86,321 83,840 81,186 income (Recoveryof)provision (4,040 ) (4,855 ) (19,159 ) 13,836 12,224 for creditlosses (l) Net interestincome after(recoveryof) 87,891 85,589 105,480 70,004 68,962 provisionfor creditlosses Other income 31,238 34,089 35,656 36,558 30,964 Other 71,400 67,865 85,661 69,859 64,799 expense Incomebefore 47,729 51,813 55,475 36,703 35,127 income taxes Income taxes 8,597 8,982 10,275 5,857 5,622 Net income $ 39,132 $ 42,831 $ 45,200 $ 30,846 $ 29,505 Per common share:Netincome- $ 2.39 $ 2.63 $ 2.77 $ 1.89 $ 1.81 basicNetincome- $ 2.38 $ 2.61 $ 2.75 $ 1.88 $ 1.80 diluted

PARK NATIONAL CORPORATIONDetail of other income and other expense - Linked Quarters 2021 2021 2020 2020 2020(in thousands) 2nd QTR 1st QTR 4th QTR 3rd QTR 2nd QTR Other income: Income fromfiduciary $ 8,569 $ 8,173 $ 7,632 $ 7,335 $ 6,793 activitiesService chargeson deposit 2,032 2,054 2,123 2,118 1,676 accountsOther service 7,159 9,617 12,040 13,047 8,758 incomeDebit card fee 6,758 6,086 5,787 5,853 5,560 incomeBank owned lifeinsurance 1,149 1,165 1,170 1,192 1,179 incomeATM fees 655 530 432 491 438 Gain (loss) onthe sale of 4 (33 ) (7 ) 569 841 OREO, netNet (loss) gainon the sale of ? ? ? (27 ) 3,313 debt securitiesGain (loss) onequity 467 1,810 2,931 1,201 (977 ) securities, netOthercomponents of 2,038 2,038 1,988 1,988 1,988 net periodicbenefit incomeMiscellaneous 2,407 2,649 1,560 2,791 1,395 Total other $ 31,238 $ 34,089 $ 35,656 $ 36,558 $ 30,964 income Other expense: Salaries $ 30,303 $ 29,896 $ 37,280 $ 31,632 $ 30,699 Employee 10,056 10,201 7,316 10,676 9,080 benefitsOccupancy 3,027 3,640 3,231 3,835 3,256 expenseFurniture andequipment 2,756 2,610 4,949 4,687 4,850 expenseData processing 7,150 7,712 3,315 3,275 2,577 feesProfessionalfees and 6,973 5,664 9,359 7,977 6,901 servicesMarketing 1,290 1,491 1,752 1,454 1,136 Insurance 1,276 1,691 1,855 1,541 1,477 Communication 770 1,122 1,097 958 874 State tax 1,103 1,108 605 1,125 1,116 expenseAmortization ofintangible 479 479 525 525 607 assetsFHLB prepayment ? ? 8,736 ? ? penaltyFoundation 4,000 ? 3,000 ? ? contributionsMiscellaneous 2,217 2,251 2,641 2,174 2,226 Total other $ 71,400 $ 67,865 $ 85,661 $ 69,859 $ 64,799 expense

PARK NATIONAL CORPORATIONAsset Quality Information Year ended December 31,(in thousands, June 30, 2021 March 31, 2021 2020 2019 2018 2017except ratios) Allowance for credit losses:Allowance forcredit losses, $ 86,886 $ 85,675 $ 56,679 $ 51,512 $ 49,988 $ 50,624 beginning ofperiodCumulativechange inaccounting ? 6,090 ? ? ? ? principle;adoption ofASU 2016-13Charge-offs 1,070 1,701 10,304 11,177 13,552 19,403 Recoveries 1,801 1,677 27,246 10,173 7,131 10,210 Net(recoveries) (731 ) 24 (16,942 ) 1,004 6,421 9,193 charge-offs(Recovery of)provision for (4,040 ) (4,855 ) 12,054 6,171 7,945 8,557 credit lossesAllowance forcredit losses, $ 83,577 $ 86,886 $ 85,675 $ 56,679 $ 51,512 $ 49,988 end of period Generalreserve trends:Allowance forcredit losses, $ 83,577 $ 86,886 $ 85,675 $ 56,679 $ 51,512 $ 49,988 end of periodAllowance onpurchasedcreditdeteriorated("PCD") loans(purchased ? ? 167 268 ? ? creditimpaired("PCI") loansfor years 2020and prior)Allowance onpurchasedloans excluded ? ? 678 ? ? ? from thegeneralreserveSpecificreserves onindividually 3,915 4,962 5,434 5,230 2,273 684 evaluatedloansGeneralreserves oncollectively $ 79,662 $ 81,924 $ 79,396 $ 51,181 $ 49,239 $ 49,304 evaluatedloans Total loans $ 7,035,646 $ 7,168,745 $ 7,177,785 $ 6,501,404 $ 5,692,132 $ 5,372,483 PCD loans (PCIloans for 10,007 10,284 11,153 14,331 3,943 ? years 2020 andprior)Purchasedloans excludedfrom ? ? 360,056 548,436 225,029 ? collectivelyevaluatedloansIndividuallyevaluated 86,874 100,407 108,407 77,459 48,135 56,545 loansCollectivelyevaluated $ 6,938,765 $ 7,058,054 $ 6,698,169 $ 5,861,178 $ 5,415,025 $ 5,315,938 loans Asset Quality Ratios:Net(recoveries)charge-offs as (0.04 ) % ? % (0.24 ) % 0.02 % 0.12 % 0.17 %a % of averageloans(annualized)Allowance forcredit lossesas a % of 1.19 % 1.21 % 1.19 % 0.87 % 0.90 % 0.93 %period endloansAllowance forcredit lossesas a % ofperiod end 1.23 % 1.28 % 1.25 % N.A. N.A. N.A.loans(excluding PPPloans) (k)Generalreserve as a %of 1.15 % 1.16 % 1.19 % 0.87 % 0.91 % 0.93 %collectivelyevaluatedloansGeneralreserves as a% ofcollectively 1.19 % 1.22 % 1.24 % N.A. N.A. N.A.evaluatedloans(excluding PPPloans) (k) Nonperforming assets:Nonaccrual $ 96,760 $ 114,708 $ 117,368 $ 90,080 $ 67,954 $ 72,056 loansAccruingtroubled debt 17,420 14,817 20,788 21,215 15,173 20,111 restructuringsLoans past due90 days or 515 802 1,458 2,658 2,243 1,792 moreTotalnonperforming $ 114,695 $ 130,327 $ 139,614 $ 113,953 $ 85,370 $ 93,959 loansOther realestate owned - 219 250 837 3,100 2,788 6,524 Park NationalBankOther realestate owned - 594 594 594 929 1,515 7,666 SEPHOthernonperforming 3,164 3,164 3,164 3,599 3,464 4,849 assets - ParkNational BankTotalnonperforming $ 118,672 $ 134,335 $ 144,209 $ 121,581 $ 93,137 $ 112,998 assetsPercentage ofnonaccrualloans to 1.38 % 1.60 % 1.64 % 1.39 % 1.19 % 1.34 %period endloansPercentage ofnonperformingloans to 1.63 % 1.82 % 1.95 % 1.75 % 1.50 % 1.75 %period endloansPercentage ofnonperformingassets to 1.69 % 1.87 % 2.01 % 1.87 % 1.64 % 2.10 %period endloansPercentage ofnonperformingassets to 1.19 % 1.35 % 1.55 % 1.42 % 1.19 % 1.50 %period endtotal assets Note: Explanations for footnotes (a) - (l) are included at the end of thefinancial tables in the "Financial Reconciliations" section.

PARK NATIONAL CORPORATIONAsset Quality Information (continued) Year ended December 31,(inthousands, June 30, March 31, 2020 2019 2018 2017except 2021 2021ratios) Newnonaccrual loaninformation:Nonaccrualloans, $ 114,708 $ 117,368 $ 90,080 $ 67,954 $ 72,056 $ 87,822 beginning ofperiodNewnonaccrual 11,342 12,540 103,386 81,009 76,611 58,753 loansResolvednonaccrual 29,290 15,200 76,098 58,883 80,713 74,519 loansNonaccrualloans, end $ 96,760 $ 114,708 $ 117,368 $ 90,080 $ 67,954 $ 72,056 of period Impairedcommercialloanportfolio information(periodend):Unpaidprincipal $ 87,502 $ 100,996 $ 109,062 $ 78,178 $ 59,381 $ 66,585 balancePrior 628 589 655 719 11,246 10,040 charge-offsRemainingprincipal 86,874 100,407 108,407 77,459 48,135 56,545 balanceSpecific 3,915 4,962 5,434 5,230 2,273 684 reservesBook value,after $ 82,959 $ 95,445 $ 102,973 $ 72,229 $ 45,862 $ 55,861 specificreserves

PARK NATIONAL CORPORATION Financial ReconciliationsNON-GAAP RECONCILIATIONS THREE MONTHS ENDED SIX MONTHS ENDED (in thousands,except share June 30, 2021 March 31, June 30, 2020 June 30, 2021 June 30, 2020 and per share 2021data)Net interest $ 83,851 $ 80,734 $ 81,186 $ 164,585 $ 157,469 incomeless purchaseaccountingaccretionrelated to 806 1,131 1,301 1,937 2,679 NewDominion andCarolinaAllianceacquisitionsless interestincome onformer Vision 2,838 105 266 2,943 343 BankrelationshipsNet interestincome - $ 80,207 $ 79,498 $ 79,619 $ 159,705 $ 154,447 adjusted (Recovery of)provision for $ (4,040 ) $ (4,855 ) $ 12,224 $ (8,895 ) $ 17,377 credit lossesless recoverieson former (152 ) (257 ) (685 ) (409 ) (1,449 ) Vision Bankrelationships(Recovery of)provision for $ (3,888 ) $ (4,598 ) $ 12,909 $ (8,486 ) $ 18,826 credit losses -adjusted Other income $ 31,238 $ 34,089 $ 30,964 $ 65,327 $ 53,450 less net gainon sale offormer Vision ? ? 837 ? 837 Bank OREOpropertiesless otherservice incomerelated to 3 58 52 61 52 former VisionBankrelationshipsless rebrandinginitiative ? ? (274 ) ? (274 ) relatedexpensesless net gainon the sale ofdebt securities ? ? 3,313 ? 3,313 in the ordinarycourse ofbusinessOther income - $ 31,235 $ 34,031 $ 27,036 $ 65,266 $ 49,522 adjusted Other expense $ 71,400 $ 67,865 $ 64,799 $ 139,265 $ 131,075 lessmerger-relatedexpensesrelated to 4 12 214 16 457 NewDominion andCarolinaAllianceacquisitionsless coredepositintangibleamortizationrelated to 479 479 607 958 1,213 NewDominion andCarolinaAllianceacquisitionsless directexpensesrelated tocollection of 300 107 ? 407 ? payments onformer VisionBank loanrelationshipsless FHLBprepayment ? ? ? ? 1,793 penaltyless rebrandinginitiative 342 955 138 1,297 408 relatedexpensesless Foundation 4,000 ? ? 4,000 ? contributionless severanceand 46 108 248 154 336 restructuringchargesless COVID-19related 670 865 1,919 1,535 2,181 expenses (j)Other expense - $ 65,559 $ 65,339 $ 61,673 $ 130,898 $ 124,687 adjusted Tax effect ofadjustments tonet income $ 429 $ 205 $ (641 ) $ 634 $ (422 ) identifiedabove (i) Net income - $ 39,132 $ 42,831 $ 29,505 $ 81,963 $ 51,877 reportedNet income - $ 40,745 $ 43,601 $ 27,092 $ 84,346 $ 50,288 adjusted (h) Diluted EPS $ 2.38 $ 2.61 $ 1.80 $ 4.98 $ 3.16 Diluted EPS, $ 2.47 $ 2.65 $ 1.65 $ 5.13 $ 3.07 adjusted (h) Annualizedreturn on 1.59 % 1.81 % 1.26 % 1.70 % 1.15 % average assets(a)(b)Annualizedreturn onaverage assets, 1.66 % 1.84 % 1.16 % 1.75 % 1.12 % adjusted (a)(b)(h) Annualizedreturn onaverage 1.62 % 1.84 % 1.28 % 1.73 % 1.18 % tangible assets(a)(b)(e)Annualizedreturn onaveragetangible 1.68 % 1.87 % 1.18 % 1.78 % 1.14 % assets,adjusted (a)(b)(e)(h) Annualizedreturn onaverage 14.81 % 16.63 % 11.89 % 15.71 % 10.54 % shareholders'equity (a)(b)Annualizedreturn onaverageshareholders' 15.42 % 16.93 % 10.92 % 16.16 % 10.21 % equity,adjusted (a)(b)(h) Annualizedreturn onaverage 17.60 % 19.84 % 14.33 % 18.70 % 12.73 % tangible equity(a)(b)(c)Annualizedreturn onaveragetangible 18.33 % 20.19 % 13.16 % 19.25 % 12.34 % equity,adjusted (a)(b)(c)(h) Efficiency 61.65 % 58.74 % 57.41 % 60.20 % 61.72 % ratio (g)Efficiencyratio, adjusted 58.45 % 57.19 % 57.44 % 57.82 % 60.70 % (g)(h) Annualized netinterest margin 3.74 % 3.76 % 3.84 % 3.75 % 3.89 % (g)Annualized netinterest 3.58 % 3.70 % 3.77 % 3.64 % 3.81 % margin,adjusted (g)(h)Note: Explanations for footnotes (a) - (l) are included at the end of the financial tables in the "Financial Reconciliations" section.

PARK NATIONAL CORPORATION FinancialReconciliations (continued) (a) Reported measure uses net income(b) Averages are for the three months ended June 30, 2021, March 31, 2021, andJune 30, 2020 and the six months ended June 30, 2021 and June 30, 2020, asappropriate(c) Net income for each period divided by average tangible equity during theperiod.Average tangible equity equals average shareholders' equity during theapplicable period less average goodwill and other intangible assets during theapplicable period. RECONCILIATION OF AVERAGE SHAREHOLDERS' EQUITY TO AVERAGE TANGIBLE EQUITY: THREE MONTHS ENDED SIX MONTHS ENDED June 30, 2021 March 31, 2021 June 30, 2020 June 30, 2021 June 30, 2020AVERAGESHAREHOLDERS' $ 1,059,949 $ 1,044,412 $ 998,288 $ 1,052,223 $ 990,132 EQUITYLess: Averagegoodwill andother 168,211 168,690 170,303 168,449 170,606 intangibleassetsAVERAGE $ 891,738 $ 875,722 $ 827,985 $ 883,774 $ 819,526 TANGIBLE EQUITY (d) Tangible equity divided by common shares outstanding at period end.Tangible equity equals total shareholders' equity less goodwill and otherintangible assets, in each case at the end of the period. RECONCILIATION OF TOTAL SHAREHOLDERS' EQUITY TO TANGIBLE EQUITY: June 30, 2021 March 31, 2021 June 30, 2020 TOTALSHAREHOLDERS' $ 1,069,392 $ 1,041,271 $ 1,001,594 EQUITYLess: Goodwilland other 167,897 168,376 169,905 intangibleassetsTANGIBLE EQUITY $ 901,495 $ 872,895 $ 831,689 (e) Net income for each period divided by average tangible assets during theperiod.Average tangible assets equal average assets less average goodwill andother intangible assets, in each case during the applicable period. RECONCILIATION OF AVERAGE ASSETS TO AVERAGE TANGIBLE ASSETS THREE MONTHS ENDED SIX MONTHS ENDED June 30, 2021 March 31, 2021 June 30, 2020 June 30, 2021 June 30, 2020AVERAGE ASSETS $ 9,872,078 $ 9,612,542 $ 9,408,265 $ 9,743,027 $ 9,044,027 Less: Averagegoodwill andother 168,211 168,690 170,303 168,449 170,606 intangibleassetsAVERAGE $ 9,703,867 $ 9,443,852 $ 9,237,962 $ 9,574,578 $ 8,873,421 TANGIBLE ASSETS (f) Tangible equity divided by tangible assets. Tangible assets equal totalassets less goodwill and other intangible assets, in each case at the end ofthe period. RECONCILIATION OF TOTAL ASSETS TO TANGIBLE ASSETS: June 30, 2021 March 31, 2021 June 30, 2020 TOTAL ASSETS $ 9,947,994 $ 9,914,069 $ 9,712,994 Less: Goodwilland other 167,897 168,376 169,905 intangibleassetsTANGIBLE ASSETS $ 9,780,097 $ 9,745,693 $ 9,543,089 (g) Efficiency ratio is calculated by dividing total other expense by the sumof fully taxable equivalent net interest income and other income. Fully taxableequivalent net interest income reconciliation is shown assuming a 21% corporatefederal income tax rate. Additionally, net interest margin is calculated on afully taxable equivalent basis by dividing fully taxable equivalent netinterest income by average interest earning assets. RECONCILIATION OF FULLY TAXABLE EQUIVALENT NET INTEREST INCOME TO NET INTERESTINCOME THREE MONTHS ENDED SIX MONTHS ENDED June 30, 2021 March 31, 2021 June 30, 2020 June 30, 2021 June 30, 2020Interest income $ 87,994 $ 85,173 $ 87,445 $ 173,167 $ 176,354 Fully taxableequivalent 718 714 723 1,432 1,448 adjustmentFully taxableequivalent $ 88,712 $ 85,887 $ 88,168 $ 174,599 $ 177,802 interest incomeInterest 4,143 4,439 6,259 8,582 18,885 expenseFully taxableequivalent net $ 84,569 $ 81,448 $ 81,909 $ 166,017 $ 158,917 interest income (h) Adjustments to net income for each period presented are detailed in thenon-GAAP reconciliations of net interest income, (recovery of) provision forcredit losses, other income and other expense.(i) The tax effect of adjustments to net income was calculated assuming a 21% corporate federal income tax rate.(j) COVID-19 related expenses includecalamity pay and special one-time bonuses to certain associates.(k) Excludes $248.9 million, $387.0 million and $331.6 million of PPP loans atJune 30, 2021, March 31, 2021 and December 31, 2020, respectively.(l) Park adopted ASU 2016-13 effective January 1, 2021. The allowance forcredit losses at June 30, 2021 and March 31, 2021 and the related (recovery of)provision for credit losses for the three months ended June 30, 2021 and March31, 2021 and the six months ended June 30, 2021 were calculated utilizing thisnew guidance.