Business Wire | Jan 19, 2022 08:15AM EST

Community Trust Bancorp, Inc. Reports Record Earnings for the Year 2021

Jan. 19, 2022

PIKEVILLE, Ky.--(BUSINESS WIRE)--Jan. 19, 2022--Community Trust Bancorp, Inc. (NASDAQ:CTBI):

Earnings Summary

(in thousands except per share 4Q 3Q 4Q YTD Yeardata) 2021 2021 2020 2021 2020

Net income $19,248 $21,142 $15,826 $87,939 $59,504

Earnings per share $1.08 $1.19 $0.89 $4.94 $3.35

Earnings per share - diluted $1.08 $1.19 $0.89 $4.94 $3.35



Return on average assets 1.41% 1.54% 1.24% 1.63% 1.23%

Return on average equity 10.94% 12.06% 9.64% 12.88% 9.36%

Efficiency ratio 55.40% 53.50% 62.75% 53.11% 58.30%

Tangible common equity 11.82% 11.77% 11.62%



Dividends declared per share $0.400 $0.400 $0.385 $1.570 $1.530

Book value per share $39.13 $38.78 $36.77



Weighted average shares 17,796 17,790 17,755 17,786 17,748

Weighted average shares - diluted 17,820 17,808 17,769 17,804 17,756

Community Trust Bancorp, Inc. (NASDAQ-CTBI) achieved earnings for the fourth quarter 2021 of $19.2 million, or $1.08 per basic share, compared to $21.1 million, or $1.19 per basic share, earned during the third quarter 2021 and $15.8 million, or $0.89 per basic share, earned during the fourth quarter 2020. Noninterest income increased quarter over quarter; however, our total revenue declined primarily as a result of a $1.8 million decline in interest income on Paycheck Protection Program loans (PPP loans). Earnings for the year ended December 31, 2021 were $87.9 million compared to $59.5 million for the year ended December 31, 2020.

4th Quarter 2021 Highlights

* Net interest income for the quarter of $40.8 million was $1.2 million, or 2.9%, below prior quarter but $2.2 million, or 5.7%, above fourth quarter 2020.

* Provision for credit losses for the fourth quarter 2021 was $0.5 million compared to a recovery of provision of $0.2 million during the quarter ended September 30, 2021. Provision for credit losses for the fourth quarter 2020 totaled $1.0 million.

* Our loan portfolio increased $10.6 million, an annualized 1.2%, during the quarter but was a decline of $145.4 million, or 4.1%, from December 31, 2020. Loans, excluding PPP loans, increased $62.4 million during the quarter.

* We experienced a net recovery of loan charge-offs for the quarter of $8 thousand. Net charge-offs for the quarter ended September 30, 2021, were $0.3 million, or 0.04% of average loans annualized, and $0.9 million, or 0.10% of average loans annualized, for the fourth quarter 2020.

* Asset quality remains strong from prior quarter as our nonperforming loans, excluding troubled debt restructurings, decreased to $16.6 million at December 31, 2021 from $18.7 million at September 30, 2021 and $26.6 million at December 31, 2020. Nonperforming assets at $20.1 million decreased $2.9 million from September 30, 2021 and $14.2 million from December 31, 2020.

* Deposits, including repurchase agreements, increased $27.1 million, an annualized 2.3%, during the quarter and $243.4 million, or 5.6%, from December 31, 2020.

* Noninterest income for the quarter ended December 31, 2021 of $15.0 million increased from prior quarter by $0.6 million, or 4.1%, but decreased $0.3 million, or 1.8%, from prior year same quarter.

* Noninterest expense for the quarter ended December 31, 2021 of $31.1 million increased $0.8 million, or 2.7%, from prior quarter, but decreased $2.5 million, or 7.4%, from prior year same quarter.

* We experienced a $5.8 million decline in taxes other than property and payroll year over year and a corresponding increase in income taxes, as a result of the Kentucky enacted legislation requiring financial institutions to transition from a bank franchise tax to the Kentucky corporate income tax beginning in 2021. Our effective income tax rate for the year 2021 was 16% compared to 14% for the year 2020.

COVID-19

We continue working with our customers through the COVID-19 pandemic. At December 31, 2021, there was one customer with a CARES Act deferral outstanding in the amount of $1.4 million. The CARES Act loan deferrals and modifications have been executed consistent with the guidelines of the CARES Act. Pursuant to the CARES Act, these loan deferrals are not included in our nonperforming loans disclosed below.

At December 31, 2021, we had closed 6,312 Paycheck Protection Program (PPP) loans totaling $401.3 million, including 3,352 loans totaling $124.3 million stemming from the Consolidated Appropriations Act 2021 (second round). Through December 31, 2021, we have had 5,543 of our PPP loans totaling $351.8 million forgiven by the SBA, including 2,608 loans totaling $76.1 million from the second round.

Net Interest Income

Percent Change

4Q 2021 Compared to:

4Q 3Q 4Q 3Q 4Q Year Year Percent($ in thousands) Change 2021 2021 2020 2021 2020 2021 2020

Components ofnet interest income

Income on $44,357 $45,726 $43,148 (3.0) 2.8% $178,169 $176,441 1.0%earning assets %

Expense on (4.6) (22.1)interest bearing 3,541 3,712 4,543 % % 15,090 25,450 (40.7)%liabilities

Net interest $40,816 $42,014 $38,605 (2.9) 5.7% $163,079 $150,991 8.0%income %

Average yieldand rates paid

Earning assets 3.45% 3.52% 3.58% (2.0) (3.6)% 3.50% 3.88% (9.8)%yield %

Rate paid on (2.3) (23.6)interest bearing 0.42% 0.43% 0.55% % % 0.45% 0.82% (45.1)%liabilities

Gross interest 3.03% 3.09% 3.03% (1.9) 0.0% 3.05% 3.06% (0.3)%margin %

Net interest 3.17% 3.23% 3.20% (1.9) (0.9)% 3.21% 3.33% (3.6)%margin %

Average balances

Investment $1,496,322 $1,511,178 $ 988,910 (1.0) 51.3% $1,324,689 $ 825,164 60.5%securities %

Loans $3,381,206 $3,400,194 $3,548,178 (0.6) (4.7)% $3,455,742 $3,453,529 0.1% %

Earning assets $5,133,843 $5,184,749 $4,821,196 (1.0) 6.5% $5,115,961 $4,562,172 12.1% %

Interest-bearing $3,337,053 $3,410,286 $3,261,814 (2.1) 2.3% $3,376,788 $3,111,367 8.5%liabilities %

Net interest income for the quarter of $40.8 million decreased $1.2 million, or 2.9%, from third quarter 2021 but increased $2.2 million, or 5.7%, from fourth quarter 2020. Our net interest income excluding PPP loans for the quarter ended December 31, 2021 was $38.3 million compared to $37.7 million for the quarter ended September 30, 2021 and $36.9 million for the quarter ended December 31, 2020. Our net interest margin at 3.17% decreased 6 basis points from prior quarter and 3 basis points from prior year same quarter, as our average earning assets decreased $50.9 million from prior quarter but increased $312.6 million from prior year same quarter. Our yield on average earning assets decreased 7 basis points from prior quarter and 13 basis points from prior year same quarter, and our cost of funds decreased 1 basis points from prior quarter and 13 basis points from prior year same quarter. As discussed more fully below, the impact of the PPP loans to the net interest margin for the fourth quarter 2021 was 15 basis points. Net interest income for the year ended December 31, 2021 increased $12.1 million, or 8.0%, compared to the year ended December 31, 2020. Interest income recognized on PPP loans increased $8.7 million year over year.

The PPP loan portfolio had an annualized yield for the quarter of 13.61% compared to 12.24% for the third quarter 2021. Interest income on the portfolio was $0.2 million during the quarter, down $0.2 million from prior quarter, while the amortization of net loan origination fees from current outstanding loans and recognition of net fee income from paid and forgiven loans was $2.3 million, down $1.7 million from prior quarter. These fees are amortized over the life of the loan with any unamortized balance fully recognized at the time of loan forgiveness. The impact of the PPP loan portfolio to the net interest margin was 15 basis points for the fourth quarter 2021 compared to 25 basis points for the third quarter 2021 and 18 basis points for the year ended December 31, 2021 while the margin was negatively impacted by one basis point for the year ended December 31, 2020.

Our ratio of average loans to deposits, including repurchase agreements, was 73.3% for the quarter ended December 31, 2021 compared to 73.1% for the quarter ended September 30, 2021 and 82.3% for the quarter ended December 31, 2020.

Noninterest Income

Percent Change

4Q 2021 Compared to:

($ in 4Q 3Q 4Q 3Q 4Q Year Year Percentthousands) Change 2021 2021 2020 2021 2020 2021 2020

Depositservice $7,083 $7,066 $6,282 0.2% 12.7% $26,529 $23,461 13.1% charges

Trust 3,305 3,039 2,786 8.7% 18.6% 12,644 10,931 15.7%revenue

Gains on (50.8)sales of 1,241 1,239 2,520 0.1% % 6,820 7,226 (5.6)% loans

Loan (28.0)related 1,254 1,050 1,741 19.4% % 5,578 4,041 38.0% fees

Bank ownedlife 1,036 655 567 58.5% 82.4% 2,844 2,306 23.3%insurance revenue

Brokerage 432 519 488 (16.8) (11.3) 1,962 1,483 32.3%revenue % %

Other 626 820 865 (23.5) (27.4) 4,086 5,112 (20.1)% % %

Totalnoninterest $14,977 $14,388 $15,249 4.1% (1.8)% $60,463 $54,560 10.8% income

Noninterest income for the quarter ended December 31, 2021 of $15.0 million was an increase of $0.6 million, or 4.1%, from prior quarter but a decrease of $0.3 million, or 1.8%, from prior year same quarter. The increase from prior quarter included increases in bank owned life insurance revenue ($0.4 million), trust revenue ($0.3 million), and loan related fees ($0.2 million). The decrease from prior year same quarter included decreases in gains on sales of loans ($1.3 million), securities gains ($0.6 million), and loan related fees ($0.5 million), partially offset by increases in deposit service charges ($0.8 million), trust revenue ($0.5 million), net gains on other real estate owned ($0.5 million), and bank owned life insurance revenue ($0.5 million).

Noninterest income for the year ended December 31, 2021 of $60.5 million was a $5.9 million, or 10.8% increase from the year ended December 31, 2020. The year over year increase in noninterest income was driven by increases in deposit service charges ($3.1 million), trust revenue ($1.7 million), loan related fees ($1.5 million), brokerage revenue ($0.5 million), bank owned life insurance revenue ($0.5 million), and net gains on other real estate owned ($0.4 million), partially offset by decreases in securities gains ($1.9 million), net gains on loans ($0.4 million), and OREO rental income ($0.2 million). Deposit service charges were primarily impacted year over year by an increase in debit card income. Loan related fees were primarily impacted by the change in the fair market value of mortgage servicing rights. Gains on sales of loans were impacted year over year by the slowdown in the industry-wide refinancing boom.

Noninterest Expense

Percent Change

4Q 2021 Compared to:

($ in 4Q 3Q 4Q 3Q 4Q Year Year Percentthousands) Change 2021 2021 2020 2021 2020 2021 2020

Salaries $11,982 $11,962 $11,797 0.2% 1.6% $47,061 $46,448 1.3%

Employee 7,486 6,891 8,309 8.6% (9.9)% 27,053 19,979 35.4%benefits

Netoccupancy 2,625 2,733 2,595 (3.9)% 1.2% 10,854 10,649 1.9%and equipment

Data 2,099 1,911 2,152 9.8% (2.5)% 8,039 7,941 1.2%processing

Legal andprofessional 868 685 669 26.8% 29.8% 3,199 3,725 (14.1)%fees

Advertising (17.5) (31.0)and 676 820 981 % % 2,928 2,980 (1.8)%marketing

Net otherreal estate 299 296 680 1.2% (56.0) 1,401 2,655 (47.2)%owned %expense

Other 5,114 5,030 6,453 1.6% (20.8) 18,750 24,862 (24.6)% %

Totalnoninterest $31,149 $30,328 $33,636 2.7% (7.4)% $119,285 $119,239 0.0%expense

Noninterest expense for the quarter ended December 31, 2021 of $31.1 million increased $0.8 million, or 2.7%, from prior quarter but decreased $2.5 million, or 7.4%, from prior year same quarter. The increase in noninterest expense quarter over quarter was primarily the result of an increase in post-retirement benefits. The decrease from prior year same quarter was the result of decreases in taxes other than property and payroll ($1.3 million), personnel expense ($0.6 million), and net other real estate owned expense ($0.4 million). The increase in personnel expense included a $1.8 million increase in bonuses and incentives as we increased the accruals for incentive payments based on earnings for the year.

Noninterest expense for the year ended December 31, 2021 of $119.3 million remained relatively flat to prior year, as a $7.7 million increase in personnel expense was offset by decreases in taxes other than property and payroll ($5.6 million), net other real estate owned expense ($1.3 million), and legal and professional fees ($0.5 million). The increase in personnel expense year over year was primarily due to incentive accruals. We experienced a $5.8 million decline in franchise taxes included in taxes other than property and payroll year over year and a corresponding increase in income taxes, as a result of the Kentucky enacted legislation requiring financial institutions to transition from a bank franchise tax to the Kentucky corporate income tax beginning in 2021.

Balance Sheet Review

Total Loans

Percent Change

4Q 2021 Compared to:

4Q 3Q 4Q 3Q 4Q($ in thousands) 2021 2021 2020 2021 2020

Commercial nonresidential $757,893 $732,442 $743,238 3.5% 2.0%real estate

Commercial residential 335,233 330,660 287,928 1.4% 16.4%real estate

SBA guaranteed PPP loans 47,335 99,116 252,667 (52.2) (81.3) % %

Other commercial 616,992 600,583 609,694 2.7% 1.2%

Total commercial 1,757,453 1,762,801 1,893,527 (0.3)% (7.2)%

Residential mortgage 767,185 763,005 784,559 0.5% (2.2)%

Home equity loans/lines 106,667 105,007 103,770 1.6% 2.8%

Total residential 873,852 868,012 888,329 0.7% (1.6)%

Consumer indirect 620,825 612,394 620,051 1.4% 0.1%

Consumer direct 156,683 155,022 152,304 1.1% 2.9%

Total consumer 777,508 767,416 772,355 1.3% 0.7%

Total loans $3,408,813 $3,398,229 $3,554,211 0.3% (4.1)%

Total Deposits and Repurchase Agreements

Percent Change

4Q 2021 Compared to:

($ in thousands)

4Q

2021

3Q

2021

4Q

2020

3Q

2021

4Q

2020

Non-interest bearing deposits

$1,331,103

$1,318,158

$1,140,925

1.0%

16.7%

Interest bearing deposits

Interest checking

97,064

90,657

78,308

7.1%

24.0%

Money market savings

1,206,401

1,210,551

1,228,742

(0.3)%

(1.8)%

Savings accounts

632,645

616,561

527,436

2.6%

19.9%

Time deposits

1,077,079

1,060,309

1,040,671

1.6%

3.5%

Repurchase agreements

271,088

292,022

355,862

(7.2)%

(23.8)%

Total interest bearing deposits and repurchase agreements

3,284,277

3,270,100

3,231,019

0.4%

1.6%

Total deposits and repurchase agreements

$4,615,380

$4,588,258

$4,371,944

0.6%

5.6%

CTBI's total assets at $5.4 billion increased $32.7 million, or 2.4% annualized, from September 30, 2021 and $279.1 million, or 5.4%, from December 31, 2020. Loans outstanding at December 31, 2021 were $3.4 billion, an increase of $10.6 million, an annualized 1.2%, from September 30, 2021 but a decrease of $145.4 million, or 4.1%, from December 31, 2020. Loans, excluding PPP loans, increased $62.4 million during the quarter, with a $46.4 million increase in the commercial loan portfolio, an $8.4 million increase in the indirect consumer loan portfolio, a $5.9 million increase in the residential loan portfolio, and a $1.7 million increase in the direct consumer loan portfolio. The PPP loan portfolio declined during the quarter $51.8 million as a result of SBA forgiveness. CTBI's investment portfolio decreased $70.5 million, or an annualized 18.3%, from September 30, 2021 but increased $457.9 million, or 45.8%, from December 31, 2020. Deposits in other banks increased $124.5 million from prior quarter but decreased $18.8 million from prior year same quarter. Deposits, including repurchase agreements, at $4.6 billion increased $27.1 million, or an annualized 2.3%, from September 30, 2021 and $243.4 million, or 5.6%, from December 31, 2020.

Shareholders' equity at December 31, 2021 was $698.2 million, a $6.6 million, or an annualized 3.8%, increase from the $691.6 million at September 30, 2021 and a $43.3 million, or 6.6%, increase from the $654.9 million at December 31, 2020. CTBI's annualized dividend yield to shareholders as of December 31, 2021 was 3.67%.

Asset Quality

CTBI's total nonperforming loans, not including performing troubled debt restructurings, decreased to $16.6 million at December 31, 2021 from $18.7 million at September 30, 2021 and $26.6 million at December 31, 2020. Accruing loans 90+ days past due at $6.0 million decreased $0.7 million from prior quarter and $11.2 million from December 31, 2020. Nonaccrual loans at $10.7 million decreased $1.4 million during the quarter but increased $1.2 million from December 31, 2020. Accruing loans 30-89 days past due at $10.9 million increased $2.0 million from prior quarter but decreased $1.6 million from December 31, 2020. Our loan portfolio management processes focus on the immediate identification, management, and resolution of problem loans to maximize recovery and minimize loss.

Our level of foreclosed properties at $3.5 million at December 31, 2021 was a $0.8 million decrease from the $4.3 million at September 30, 2021 and a $4.2 million decrease from the $7.7 million at December 31, 2020. Sales of foreclosed properties for the quarter ended December 31, 2021 totaled $0.9 million while new foreclosed properties totaled $0.3 million. At December 31, 2021, the book value of properties under contracts to sell was $0.3 million; however, the closings had not occurred at quarter-end.

We experienced a net recovery of loan charge-offs for the quarter of $8 thousand, compared to net loan charge-offs of $0.3 million, or 0.04% of average loans annualized, for the quarter ended September 30, 2021 and $0.9 million, or 0.10% of average loans annualized, for the fourth quarter 2020. For the year ended December 31, 2021, we experienced a net recovery of loan losses of $0.1 million compared to net charge-offs of $6.2 million, or 0.18% of average loans annualized, for the year ended December 31, 2020.

Allowance for Credit Losses

Provision for credit losses for the fourth quarter 2021 was $0.5 million compared to a recovery of provision of $0.2 million during the quarter ended September 30, 2021. Provision for credit losses for the fourth quarter 2020 totaled $1.0 million. We experienced a recovery of provision for credit losses for the year 2021 of $6.4 million compared to provision for credit losses of $16.0 million for the year 2020. The reduction to our allowance for credit losses during the year was the result of positive credit metrics, the lack of pandemic related losses provided for in 2020, and an improvement in the industry outlook for certain industries included in our concentrations of credit. Our reserve coverage (allowance for credit losses to nonperforming loans) at December 31, 2021 was 251.2% compared to 220.0% at September 30, 2021 and 180.7% at December 31, 2020. Our credit loss reserve as a percentage of total loans outstanding at December 31, 2021 was 1.22% (1.24% excluding PPP loans) compared to 1.21% at September 30, 2021 (1.25% excluding PPP loans) and 1.35% at December 31, 2020 (1.45% excluding PPP loans).

Forward-Looking Statements

Certain of the statements contained herein that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act. Community Trust Bancorp, Inc.'s ("CTBI") actual results may differ materially from those included in the forward-looking statements. Forward-looking statements are typically identified by words or phrases such as "believe," "expect," "anticipate," "intend," "estimate," "may increase," "may fluctuate," and similar expressions or future or conditional verbs such as "will," "should," "would," and "could." These forward-looking statements involve risks and uncertainties including, but not limited to, economic conditions, portfolio growth, the credit performance of the portfolios, including bankruptcies, and seasonal factors; changes in general economic conditions including the performance of financial markets, prevailing inflation and interest rates, realized gains from sales of investments, gains from asset sales, and losses on commercial lending activities; the effects of the COVID-19 pandemic on our business operations and credit quality and on general economic and financial market conditions, as well as our ability to respond to the related challenges; results of various investment activities; the effects of competitors' pricing policies, changes in laws and regulations, competition, and demographic changes on target market populations' savings and financial planning needs; industry changes in information technology systems on which we are highly dependent; failure of acquisitions to produce revenue enhancements or cost savings at levels or within the time frames originally anticipated or unforeseen integration difficulties; and the resolution of legal proceedings and related matters. In addition, the banking industry in general is subject to various monetary, operational, and fiscal policies and regulations, which include, but are not limited to, those determined by the Federal Reserve Board, the Federal Deposit Insurance Corporation, the Consumer Financial Protection Bureau, and state regulators, whose policies, regulations, and enforcement actions could affect CTBI's results. These statements are representative only on the date hereof, and CTBI undertakes no obligation to update any forward-looking statements made.

Community Trust Bancorp, Inc., with assets of $5.4 billion, is headquartered in Pikeville, Kentucky and has 70 banking locations across eastern, northeastern, central, and south central Kentucky, six banking locations in southern West Virginia, three banking locations in northeastern Tennessee, four trust offices across Kentucky, and one trust office in Tennessee.

Additional information follows.

Total Deposits andRepurchase Agreements

Percent Change

4Q 2021 Compared to:

4Q 3Q 4Q 3Q 4Q($ in thousands) 2021 2021 2020 2021 2020

Non-interest bearing $1,331,103 $1,318,158 $1,140,925 1.0% 16.7%deposits

Interest bearing deposits

Interest checking 97,064 90,657 78,308 7.1% 24.0%

Money market savings 1,206,401 1,210,551 1,228,742 (0.3) (1.8)% %

Savings accounts 632,645 616,561 527,436 2.6% 19.9%

Time deposits 1,077,079 1,060,309 1,040,671 1.6% 3.5%

Repurchase agreements 271,088 292,022 355,862 (7.2) (23.8) % %

Total interest bearingdeposits and repurchase 3,284,277 3,270,100 3,231,019 0.4% 1.6%agreements

Total deposits and $4,615,380 $4,588,258 $4,371,944 0.6% 5.6%repurchase agreements

CTBI's total assets at $5.4 billion increased $32.7 million, or 2.4% annualized, from September 30, 2021 and $279.1 million, or 5.4%, from December 31, 2020. Loans outstanding at December 31, 2021 were $3.4 billion, an increase of $10.6 million, an annualized 1.2%, from September 30, 2021 but a decrease of $145.4 million, or 4.1%, from December 31, 2020. Loans, excluding PPP loans, increased $62.4 million during the quarter, with a $46.4 million increase in the commercial loan portfolio, an $8.4 million increase in the indirect consumer loan portfolio, a $5.9 million increase in the residential loan portfolio, and a $1.7 million increase in the direct consumer loan portfolio. The PPP loan portfolio declined during the quarter $51.8 million as a result of SBA forgiveness. CTBI's investment portfolio decreased $70.5 million, or an annualized 18.3%, from September 30, 2021 but increased $457.9 million, or 45.8%, from December 31, 2020. Deposits in other banks increased $124.5 million from prior quarter but decreased $18.8 million from prior year same quarter. Deposits, including repurchase agreements, at $4.6 billion increased $27.1 million, or an annualized 2.3%, from September 30, 2021 and $243.4 million, or 5.6%, from December 31, 2020.

Shareholders' equity at December 31, 2021 was $698.2 million, a $6.6 million, or an annualized 3.8%, increase from the $691.6 million at September 30, 2021 and a $43.3 million, or 6.6%, increase from the $654.9 million at December 31, 2020. CTBI's annualized dividend yield to shareholders as of December 31, 2021 was 3.67%.

Asset Quality

CTBI's total nonperforming loans, not including performing troubled debt restructurings, decreased to $16.6 million at December 31, 2021 from $18.7 million at September 30, 2021 and $26.6 million at December 31, 2020. Accruing loans 90+ days past due at $6.0 million decreased $0.7 million from prior quarter and $11.2 million from December 31, 2020. Nonaccrual loans at $10.7 million decreased $1.4 million during the quarter but increased $1.2 million from December 31, 2020. Accruing loans 30-89 days past due at $10.9 million increased $2.0 million from prior quarter but decreased $1.6 million from December 31, 2020. Our loan portfolio management processes focus on the immediate identification, management, and resolution of problem loans to maximize recovery and minimize loss.

Our level of foreclosed properties at $3.5 million at December 31, 2021 was a $0.8 million decrease from the $4.3 million at September 30, 2021 and a $4.2 million decrease from the $7.7 million at December 31, 2020. Sales of foreclosed properties for the quarter ended December 31, 2021 totaled $0.9 million while new foreclosed properties totaled $0.3 million. At December 31, 2021, the book value of properties under contracts to sell was $0.3 million; however, the closings had not occurred at quarter-end.

We experienced a net recovery of loan charge-offs for the quarter of $8 thousand, compared to net loan charge-offs of $0.3 million, or 0.04% of average loans annualized, for the quarter ended September 30, 2021 and $0.9 million, or 0.10% of average loans annualized, for the fourth quarter 2020. For the year ended December 31, 2021, we experienced a net recovery of loan losses of $0.1 million compared to net charge-offs of $6.2 million, or 0.18% of average loans annualized, for the year ended December 31, 2020.

Allowance for Credit Losses

Provision for credit losses for the fourth quarter 2021 was $0.5 million compared to a recovery of provision of $0.2 million during the quarter ended September 30, 2021. Provision for credit losses for the fourth quarter 2020 totaled $1.0 million. We experienced a recovery of provision for credit losses for the year 2021 of $6.4 million compared to provision for credit losses of $16.0 million for the year 2020. The reduction to our allowance for credit losses during the year was the result of positive credit metrics, the lack of pandemic related losses provided for in 2020, and an improvement in the industry outlook for certain industries included in our concentrations of credit. Our reserve coverage (allowance for credit losses to nonperforming loans) at December 31, 2021 was 251.2% compared to 220.0% at September 30, 2021 and 180.7% at December 31, 2020. Our credit loss reserve as a percentage of total loans outstanding at December 31, 2021 was 1.22% (1.24% excluding PPP loans) compared to 1.21% at September 30, 2021 (1.25% excluding PPP loans) and 1.35% at December 31, 2020 (1.45% excluding PPP loans).

Forward-Looking Statements

Certain of the statements contained herein that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act. Community Trust Bancorp, Inc.'s ("CTBI") actual results may differ materially from those included in the forward-looking statements. Forward-looking statements are typically identified by words or phrases such as "believe," "expect," "anticipate," "intend," "estimate," "may increase," "may fluctuate," and similar expressions or future or conditional verbs such as "will," "should," "would," and "could." These forward-looking statements involve risks and uncertainties including, but not limited to, economic conditions, portfolio growth, the credit performance of the portfolios, including bankruptcies, and seasonal factors; changes in general economic conditions including the performance of financial markets, prevailing inflation and interest rates, realized gains from sales of investments, gains from asset sales, and losses on commercial lending activities; the effects of the COVID-19 pandemic on our business operations and credit quality and on general economic and financial market conditions, as well as our ability to respond to the related challenges; results of various investment activities; the effects of competitors' pricing policies, changes in laws and regulations, competition, and demographic changes on target market populations' savings and financial planning needs; industry changes in information technology systems on which we are highly dependent; failure of acquisitions to produce revenue enhancements or cost savings at levels or within the time frames originally anticipated or unforeseen integration difficulties; and the resolution of legal proceedings and related matters. In addition, the banking industry in general is subject to various monetary, operational, and fiscal policies and regulations, which include, but are not limited to, those determined by the Federal Reserve Board, the Federal Deposit Insurance Corporation, the Consumer Financial Protection Bureau, and state regulators, whose policies, regulations, and enforcement actions could affect CTBI's results. These statements are representative only on the date hereof, and CTBI undertakes no obligation to update any forward-looking statements made.

Community Trust Bancorp, Inc., with assets of $5.4 billion, is headquartered in Pikeville, Kentucky and has 70 banking locations across eastern, northeastern, central, and south central Kentucky, six banking locations in southern West Virginia, three banking locations in northeastern Tennessee, four trust offices across Kentucky, and one trust office in Tennessee.

Additional information follows.

Community Trust Bancorp, Inc.Financial Summary (Unaudited)December 31, 2021(in thousands except per share data and # of employees) Three Three Three Twelve Twelve Months Months Months Months Months Ended Ended Ended Ended Ended December 31, September 30, December 31, December 31, December 31, 2021 2021 2020 2021 2020Interest $ 44,357 $ 45,726 $ 43,148 $ 178,169 $ 176,441 incomeInterest 3,541 3,712 4,543 15,090 25,450 expenseNet interest 40,816 42,014 38,605 163,079 150,991 incomeLoan loss 533 (163 ) 956 (6,386 ) 16,047 provision Gains on 1,241 1,239 2,520 6,820 7,226 sales ofloansDeposit 7,083 7,066 6,282 26,529 23,461 servicechargesTrust revenue 3,305 3,039 2,786 12,644 10,931

Loan related 1,254 1,050 1,741 5,578 4,041 feesSecurities (208 ) (62 ) 441 (158 ) 1,769 gains(losses)Other 2,302 2,056 1,479 9,050 7,132 noninterestincomeTotal 14,977 14,388 15,249 60,463 54,560 noninterestincome Personnel 19,468 18,853 20,106 74,114 66,427 expenseOccupancy and 2,625 2,733 2,595 10,854 10,649 equipmentData 2,099 1,911 2,152 8,039 7,941 processingexpenseFDIC 339 393 320 1,381 1,056 insurancepremiumsOther 6,618 6,438 8,463 24,897 33,166 noninterestexpenseTotal 31,149 30,328 33,636 119,285 119,239 noninterestexpense Net income 24,111 26,237 19,262 110,643 70,265 before taxesIncome taxes 4,863 5,095 3,436 22,704 10,761

Net income $ 19,248 $ 21,142 $ 15,826 $ 87,939 $ 59,504

Memo: TEQ $ 44,581 $ 45,952 $ 43,336 $ 179,066 $ 177,168 interestincome Average 17,796 17,790 17,755 17,786 17,748 sharesoutstandingDilutedaverage 17,820 17,808 17,769 17,804 17,756 sharesoutstandingBasic $ 1.08 $ 1.19 $ 0.89 $ 4.94 $ 3.35 earnings pershareDiluted $ 1.08 $ 1.19 $ 0.89 $ 4.94 $ 3.35 earnings pershareDividends per $ 0.400 $ 0.400 $ 0.385 $ 1.570 $ 1.530 share Averagebalances:Loans $ 3,381,206 $ 3,400,194 $ 3,548,178 $ 3,455,742 $ 3,453,529

Earning 5,133,843 5,184,749 4,821,196 5,115,961 4,562,172 assetsTotal assets 5,418,854 5,457,558 5,092,100 5,387,241 4,838,160

Deposits,including 4,612,010 4,650,885 4,310,970 4,592,415 4,079,810 repurchaseagreementsInterest 3,337,053 3,410,286 3,261,814 3,376,788 3,111,367 bearingliabilitiesShareholders' 697,727 695,490 652,827 682,697 635,978 equity Performanceratios:Return on 1.41 % 1.54 % 1.24 % 1.63 % 1.23 %averageassetsReturn on 10.94 % 12.06 % 9.64 % 12.88 % 9.36 %averageequityYield onaverage 3.45 % 3.52 % 3.58 % 3.50 % 3.88 %earningassets (taxequivalent)Cost ofinterest 0.42 % 0.43 % 0.55 % 0.45 % 0.82 %bearing funds(taxequivalent)Net interest 3.17 % 3.23 % 3.20 % 3.21 % 3.33 %margin (taxequivalent)Efficiency 55.40 % 53.50 % 62.75 % 53.11 % 58.30 %ratio (taxequivalent) Loan $ 865 $ 1,042 $ 1,961 $ 4,325 $ 10,453 charge-offsRecoveries (873 ) (725 ) (1,041 ) (4,445 ) (4,292 )

Net $ (8 ) $ 317 $ 920 $ (120 ) $ 6,161 charge-offs Market Price:High $ 46.21 $ 42.95 $ 38.50 $ 47.53 $ 46.87

Low $ 41.05 $ 38.20 $ 27.74 $ 36.02 $ 26.45

Close $ 43.61 $ 42.10 $ 37.05 $ 43.61 $ 37.05

As of As of As of December 31, September 30, December 31, 2021 2021 2020Assets:Loans $ 3,408,813 $ 3,398,229 $ 3,554,211

Loan loss (41,756 ) (41,215 ) (48,022 )reserveNet loans 3,367,057 3,357,014 3,506,189

Loans held 2,632 12,056 23,259 for saleSecurities 1,455,429 1,525,738 997,261 AFSEquity 2,253 2,461 2,471 securities atfair valueOther equity 13,026 13,026 14,935 investmentsOther earning 267,286 143,789 286,074 assetsCash and due 46,558 66,075 54,250 from banksPremises and 40,479 40,145 42,001 equipmentRight of use 12,148 12,399 13,215 assetGoodwill and 65,490 65,490 65,490 core depositintangibleOther assets 145,899 147,392 133,996

Total Assets $ 5,418,257 $ 5,385,585 $ 5,139,141

Liabilitiesand Equity:Interest $ 97,064 $ 90,657 $ 78,308 bearingcheckingSavings 1,839,046 1,827,112 1,756,178 depositsCD's >= 589,853 565,869 545,613 $100,000Other time 487,226 494,440 495,058 depositsTotalinterest 3,013,189 2,978,078 2,875,157 bearingdepositsNoninterest 1,331,103 1,318,158 1,140,925 bearingdepositsTotal 4,344,292 4,296,236 4,016,082 depositsRepurchase 271,088 292,022 355,862 agreementsOtherinterest 58,716 58,721 58,736 bearingliabilitiesLease 13,005 13,229 13,972 liabilityOthernoninterest 32,954 33,734 39,624 bearingliabilitiesTotal 4,720,055 4,693,942 4,484,276 liabilitiesShareholders' 698,202 691,643 654,865 equityTotal $ 5,418,257 $ 5,385,585 $ 5,139,141 Liabilitiesand Equity Ending shares 17,843 17,837 17,810 outstanding 30 - 89 days $ 10,874 $ 8,874 $ 12,465 past dueloans90 days past 5,954 6,650 17,133 due loansNonaccrual 10,671 12,084 9,444 loansRestructuredloans(excluding 90 69,827 70,932 68,554 days past dueandnonaccrual)Foreclosed 3,486 4,314 7,694 properties Community 13.00 % 12.71 % 12.70 %bank leverageratioTangibleequity to 11.82 % 11.77 % 11.62 %tangibleassets ratioFTE employees 974 960 998

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CONTACT: Community Trust Bancorp, Inc. Jean R. Hale, (606) 437-3294 Chairman and C.E.O.