Associated Banc-Corp (NYSE:ASB) Q1 2023 Earnings Conference Call April 20, 2023 5:00 PM ET Company Participants Andrew Harmening - President and Chief Executive Officer Derek Meyer - Executive Vice President and Chief Financial Officer Patrick Ahern - Executive Vice President, Chief Credit Officer and Chicago Market President Conference Call Participants Jared Shaw - Wells Fargo Securities, LLC Daniel Tamayo - Raymond James & Associates, Inc. Terence McEvoy - Stephens Inc. Brody Preston - UBS Jon Arfstrom - ...

First Quarter 2023 Earnings Presentation APRIL 20, 2023 Forward-Looking Statements 1 Important note regarding forward-looking statements: Statements made in this presentation which are not purely historical are forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. This includes any statements regarding management's plans, objectives, or goals for future operations, products or services, and forecasts of its revenues, earnings, or other measures of performance. Such ...

Capital Requirements and Regulatory Compliance - The Corporation continues to exceed all capital requirements necessary to be deemed "well-capitalized" for regulatory purposes[52] - As of December 31, 2022, the Bank satisfied the capital requirements necessary to be deemed "well capitalized"[60] - The Corporation's CET1 capital ratio is 10.31% as of December 31, 2022, down from 10.45% in 2021[391] - Total capital increased to $3,680,227,000 in 2022 from $3,570,026,000 in 2021, reflecting a growth of approximately 3.1%[391] - Total risk-weighted assets rose to $32,472,008,000 in 2022, compared to $27,242,735,000 in 2021, indicating an increase of about 19.3%[391] Deposit Insurance and Assessment Rates - The FDIC adopted a final rule to increase base deposit insurance assessment rate schedules uniformly by 2 basis points starting in 2023[63] - The Corporation's FDIC assessment rate was approximately 7 basis points for 2022[64] - The Dodd-Frank Act authorized a permanent increase in deposit insurance to $250,000 per depositor, per IDI for each account ownership category[61] Economic and Regulatory Changes - The Economic Growth Act raised the asset threshold for stress testing from $10 billion to $250 billion in total consolidated assets[55] - The Corporation elected to utilize the 2020 Capital Transition Relief, allowing a three-year phase-out period for the CECL model effects starting in 2022[54] - The Dodd-Frank Act may significantly impact the Corporation's operations, particularly through increased compliance costs from potential future consumer and fair lending regulations[95] Cybersecurity and Compliance - The final rule from federal banking agencies requires banks to notify their primary federal regulator within 36 hours of discovering a significant cybersecurity incident[76] - During 2022, the Corporation did not discover any material cybersecurity incidents, indicating effective cybersecurity measures[77] - The Dodd-Frank Act mandates that national banks have a board-approved program to ensure compliance with the Bank Secrecy Act (BSA) and includes independent testing and training requirements[78] Environmental and Climate Risk Management - Federal banking agencies have heightened their focus on climate-related risks, encouraging banks to incorporate climate risk management into governance structures and strategic planning[96] - The SEC proposed new climate-related disclosure rules that, if adopted in 2023, would require disclosures on climate-related metrics and greenhouse gas emissions in SEC filings[100] - The Corporation has established an Environmental Sustainability Risk Policy to manage environmental risks, including climate change and carbon emissions[102] Financial Performance and Income - Fully tax-equivalent net interest income increased by $234 million, or 31%, in 2022 compared to 2021, driven by strategic initiatives and rising interest rates[284] - Noninterest income decreased by $49.994 million, or 15%, in 2022 compared to 2021, primarily due to declines in mortgage banking and wealth management fees[291] - Total revenue for the Corporate and Commercial Specialty segment increased by $64 million from the year ended December 31, 2021, primarily due to higher loan balances and interest rates[400] Loan and Credit Quality - Total loans amounted to $299.37 billion, with significant contributions from commercial and business lending, and residential mortgages[287] - The provision for credit losses is based on the Corporation's reserving methodology and economic forecasts, with no material updates made to the baseline scenario used[288] - Total nonaccrual loans increased to $210,854 thousand, up from $130,443 thousand year-over-year, reflecting a significant rise in credit risk[324] Asset and Liability Management - Total assets reached $39.4 billion, a $4.3 billion increase or 12% from December 31, 2021[299] - Total deposits increased to $29.6 billion, a rise of $1.2 billion or 4% from December 31, 2021, mainly due to a $1.1 billion increase in money market deposits[300] - The Corporation's interest rate risk profile is asset sensitive as of December 31, 2022, indicating that a higher yield curve would increase income[379] Operational Efficiency and Cost Management - The return on average assets improved to 1.02% in 2022 from 0.90% in 2021[391] - Federal Reserve efficiency ratio improved to 60.36% from 66.33% in 2021, showing enhanced operational efficiency[394] - Adjusted efficiency ratio stood at 58.75%, compared to 65.36% in the previous year, indicating better cost management[394]

Financial Data and Key Metrics Changes - In Q4 2022, net interest income increased by 9% quarter-over-quarter and 55% year-over-year, reflecting strong loan and deposit growth [9][10] - The return on common equity exceeded 16% for the quarter, driven by positive operating leverage and disciplined expense management [9][10] - For the full year 2022, net income available to common equity increased by 6% year-over-year despite a $121 million provision-driven headwind [10] Business Line Data and Key Metrics Changes - The construction loan portfolio led growth, primarily due to funding of prior commitments, while new production slowed [11][12] - Commercial loan growth was robust, with a 57% year-over-year increase in new customer relationships, contributing to the achievement of growth targets [13] - Consumer auto finance continued to produce high-quality loans, although production rates were intentionally slowed to reflect market conditions [14] Market Data and Key Metrics Changes - Average deposits grew by 2% quarter-over-quarter and 3% year-over-year, driven by core customer deposits despite inflationary pressures [15][16] - The competitive environment for deposits is expected to intensify in 2023, prompting strategic initiatives to cultivate customer relationships [17][19] Company Strategy and Development Direction - The company is focused on balanced loan growth across consumer and commercial segments, with an expectation of 7% to 9% total loan growth in 2023 [33] - Strategic investments in technology and talent are ongoing, with a commitment to maintaining expense growth below revenue growth [20][33] - The company aims to enhance its digital platform and customer acquisition strategies to drive deposit growth [18][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of midwest markets, with stable unemployment rates and increased consumer spending [7][8] - The macroeconomic outlook remains uncertain, but the company is positioned to benefit from rising interest rates while managing interest rate risk [23][24] - Expectations for net interest income growth in 2023 are between 15% and 17%, reflecting anticipated rate increases and balance sheet dynamics [24][33] Other Important Information - The company achieved a 41% increase in PTPP income for the full year 2022, underscoring strong revenue generation and expense management [20] - Non-interest income is expected to face pressure in 2023, with a projected decline of 6% to 8% due to market headwinds [26] Q&A Session Summary Question: What does the visibility look like into the pipeline heading into '23? - Management noted that growth in construction loans was due to funding prior commitments, with expectations for moderation in this category as new production is limited [35] Question: Where could margin sort of peak out? - Management refrained from predicting the peak margin but emphasized a focus on fundamentals driving durable margin [38] Question: Should we expect more activity in capital management? - Management indicated no changes to capital return strategies, focusing on dividends and organic growth [42] Question: How would NII trajectory look throughout the year? - Management suggested that while NII may see some quarterly compression, full-year guidance remains robust based on deposit growth initiatives [45] Question: What is the message of the new brand campaign? - The campaign will focus on aligning the company's messaging with customer needs, emphasizing digital relevance and product execution [76]

Fourth Quarter 2022 Earnings Presentation JANUARY 26, 2023 Forward-Looking Statements Important note regarding forward-looking statements: Statements made in this presentation which are not purely historical are forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. This includes any statements regarding management's plans, objectives, or goals for future operations, products or services, and forecasts of its revenues, earnings, or other measures of performance. Such ...

Associated Banc-Corp (NYSE:ASB) Q3 2022 Earnings Conference Call October 20, 2022 5:00 PM ET Company Participants Andrew Harmening - CEO Derek Meyer - CFO Pat Ahern - Chief Credit Officer Conference Call Participants Timur Braziler - Wells Fargo Scott Siefers - Piper Sandler Chris McGratty - KBW Terry McEvoy - Stephens Daniel Tamayo - Raymond James Operator Good afternoon, everyone, and welcome to Associated Banc-Corp's Third Quarter 2022 Earnings Conference Call. My name is Kevin, and I will be your operat ...