Allowance for Credit Losses - Loans: 1Q 2023 Change Change in economic forecast Change in qualitative adjustments - concentrations/credit Other, net ACL (Dollars in millions) $136.2 $(3.8) $(5.5) $(8.0) $(5.8) $4.5 $117.6 ACL Change in portfolio balances and mix 12/31/22 3/31/23 Change in qualitative adjustmentseconomy B Source: Company documents 26 Strong Credit Culture and Performance (0.01)% (0.02)% Non-performing Assets / Assets Annualized Net Charge-Offs (Recoveries) / Average Loans 0.37% 0.33% 0.33% 0 ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Fiscal Year Ended December 31, 2022 ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number 0-19065 SANDY SPRING BANCORP, INC. (Exact name of registrant as specified in its charter) Maryland 52-1532952 (State or other jurisdiction of incorporation or organization) 17801 Georgi ...

Financial Performance - The company reported net income of $34 million or $0.76 per diluted common share for Q4 2022, down from $45.4 million or $0.99 per diluted common share in Q4 2021 and slightly up from $33.6 million or $0.75 per diluted common share in Q3 2022 [7] - Core earnings were $35.3 million or $0.79 per diluted common share, compared to $46.6 million or $1.2 per diluted common share in Q4 2021 and $35.7 million or $0.80 per diluted common share in Q3 2022 [8] - Pre-tax, pre-provision income was $56.6 million, down from $64.1 million in the linked quarter and $61.7 million in the prior year quarter [9] - The provision for credit losses was a charge of $10.8 million, significantly higher than $1.6 million in Q4 2021 and lower than $18.9 million in Q3 2022 [9][10] Balance Sheet and Loan Growth - Total assets grew 10% to $13.8 billion compared to $12.6 billion in the prior year quarter, with total loans (excluding PPP) increasing 16% to $11.4 billion [11] - Gross commercial loan production over the past 12 months was $3.9 billion, with $2.5 billion funded, offsetting a $1.2 billion non-PPP commercial loan run-off [12] - Commercial run-off in Q4 was 38% lower than the linked quarter and 45% lower than the prior year quarter, with an annualized run-off rate of 10% [13] Business Lines and Market Focus - The company is diversifying its lending concentration by attracting more commercial and industrial (C&I) relationships while continuing to serve commercial real estate (CRE) clients [14] - C&I growth has outpaced CRE growth for the first time in many quarters, with expectations for C&I owner-occupied growth of 2% to 3% per quarter starting in Q2 2023 [15] - The commercial pipeline was at $944 million, down from $1.3 billion in the linked quarter, indicating a shift in focus to C&I lending [16] Interest Margin and Funding - The net interest margin was 3.26%, down from 3.51% in Q4 2021 and 3.53% in Q3 2022, attributed to rising rates on interest-bearing liabilities [18] - The company anticipates further decline in the margin to 3.10% to 3.15% in Q1 2023, with potential recovery later in the year [19] - Deposits grew 3% year-over-year, with interest-bearing deposits increasing by 6% [16] Management Commentary and Future Outlook - Management noted a challenging operating environment with high inflation and rapid interest rate increases, but indicated no trends suggesting credit quality deterioration [5][31] - The company expects overall loan growth for the year to be in the mid-single digits, weighted towards the latter half of the year [23] - Management is actively working on initiatives to enhance deposit relationships and has launched a new online account opening platform [25] Other Important Information - The allowance for credit losses was $136.2 million, or 1.2% of outstanding loans, compared to $128.3 million or 1.14% in the previous quarter [34] - The tangible common equity ratio decreased to 8.18% of tangible assets, down from 9.21% a year earlier [35] - The company announced the retirement of its President of Commercial Banking, Ken Cook, who will join the Board of Directors [37] Q&A Session Summary Question: Margin and Loan Growth - Analysts inquired about the potential rebound of the margin if the Fed pauses rate increases, with management suggesting a possible increase of 5 to 10 basis points per quarter [43] - Questions were raised regarding the impact of deposit growth on margin expansion, with management emphasizing the need for core deposit growth [43][44] Question: Office Exposure - Analysts asked about the company's total office exposure, which is approximately $840 million, with a focus on suburban office spaces rather than urban [46] - Management confirmed no downgrades in the office portfolio and highlighted strong cash flow coverages [50] Question: Non-Interest-Bearing Deposits - Questions were raised about the decline in non-interest-bearing deposits, with management indicating that they may have bottomed out and could rebound [72][76] - Analysts also inquired about competitive pressures in the market, with management stating that competition remains strong but stable [79]

Investor Real Estate $ 45,289 $ 50,813 $ 56,794 $ 64,169 $ 64,737 Commercial AD&C 20,322 18,459 13,383 16,847 18,646 Commercial Business 23,170 21,771 22,238 24,826 28,027 Total Commercial 100,468 101,903 103,199 116,941 123,056 Residential Mortgage 5,384 5,722 7,254 8,063 9,424 Residential Construction 1,048 889 1,141 1,226 1,337 Consumer 2,245 2,074 2,076 2,038 2,425 Total Residential and Consumer 8,677 8,685 10,471 11,327 13,186 Allowance for Credit Losses $ 109,145 $ 110,588 $ 113,670 $ 128,268 $ 136,24 ...

3rd Quarter 2022 Earnings Presentation October 20, 2022 1 Forward Looking Statements 3 Sandy Spring Bancorp's forward-looking statements are subject to the following principal risks and uncertainties: risks, uncertainties and other factors relating to the COVID-19 pandemic, including the effect of the pandemic on our borrowers and their ability to make payments on their obligations, the effectiveness of vaccination programs, and the effect of remedial actions and stimulus measures adopted by federal, state ...

Financial Data and Key Metrics Changes - The company reported net income of $33.6 million or $0.75 per diluted common share for Q3 2022, down from $57 million or $1.20 per diluted common share in Q3 2021 and $54.8 million or $1.21 per share in Q2 2022 [10] - Core earnings were $35.7 million compared to $44.2 million for the linked quarter and $58.2 million for the prior year quarter, primarily due to the provision for credit losses and expected decline in mortgage banking income [11] - Pre-tax, pre-provision income for the quarter was $64.1 million, a 6% increase after adjusting for prior quarter gains [12] - The provision for credit losses was a charge of $18.9 million, compared to a credit of $8.2 million for the prior year quarter [13] Business Line Data and Key Metrics Changes - Total loans excluding PPP increased 21% to $11.2 billion compared to $9.3 billion at September 30, 2021, with commercial loans net of PPP growing by $1.6 billion or 21% [14] - Consumer loan portfolio decreased 6.2% year-over-year, while commercial pipeline was $1.3 billion compared to $1.7 billion at the linked quarter end [17] - Non-interest income decreased by 31% or $7.5 million compared to the prior year quarter, primarily due to economic impacts on mortgage banking and wealth management income [22] Market Data and Key Metrics Changes - Total assets were $13.8 billion, a 6% increase year-over-year, and 10% excluding PPP balances [14] - Deposit growth has been challenging, with deposits decreasing 2% over the past 12 months [17] - The net interest margin for the current quarter was 3.53%, slightly higher than the prior quarter, but expected to compress to the low 330s in the coming quarters [20][21] Company Strategy and Development Direction - The company is focused on growing client relationships and investing in technology and human capital while managing credit quality and operating costs [8] - Plans to launch a sophisticated online account opening platform in early 2023 to enhance client experience [19] - The company aims for an 8% to 10% loan growth expectation for 2023, driven by existing and new client demand [74] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the unprecedented environment due to inflation and recession expectations but remains focused on long-term growth [7] - The increase in provision for credit losses was driven by growth and an assumed greater probability of recession [28] - Management sees no inherent signs of weakness in the major sectors of the loan portfolio despite the increase in provision [28] Other Important Information - The tangible common equity ratio decreased to 7.98% of tangible assets, attributed to share repurchases and rising rate impacts [32] - The company paid a special one-time bonus to employees in August to support them amid inflation [35] - Sandy Spring Bancorp ranked number 23 among the 300 largest publicly traded banks in the country [36] Q&A Session Summary Question: Margin forecast and deposit costs - Management expects net interest margin to be in the low 330s due to rising funding costs and the need to replace wholesale funding with deposits [40][41] Question: Deposit growth strategy - Growth is expected from money market accounts and CDs, with efforts to stabilize DDA balances [46] Question: Credit quality outlook - The large provision this quarter was influenced by growth and macroeconomic factors, with expectations for a potential decrease in future provisions [61][62] Question: Loan growth expectations - Management anticipates loan growth in the range of 8% to 10% for 2023, contingent on funding capabilities [74] Question: M&A activity - The company continues to explore M&A opportunities but has no immediate updates [80]

PART I - FINANCIAL INFORMATION [Condensed Consolidated Financial Statements](index=3&type=section&id=Item%201.%20CONDENSED%20CONSOLIDATED%20FINANCIAL%20STATEMENTS) This section presents the unaudited condensed consolidated financial statements for Q2 2022, including statements of condition, income, and cash flows, with notes on significant events Condensed Consolidated Statements of Condition (Unaudited) | (In millions) | June 30, 2022 | December 31, 2021 | | :--- | :--- | :--- | | **Assets** | | | | Cash and cash equivalents | $221.28 | $420.02 | | Net loans | $10,672.62 | $9,857.95 | | Total assets | $13,303.01 | $12,590.73 | | **Liabilities & Equity** | | | | Total deposits | $10,969.46 | $10,624.73 | | Total borrowings | $730.65 | $313.80 | | Total liabilities | $11,825.84 | $11,071.05 | | Total stockholders' equity | $1,477.17 | $1,519.68 | Condensed Consolidated Statements of Income (Unaudited) | (In millions, except per share data) | Three Months Ended June 30, 2022 | Three Months Ended June 30, 2021 | Six Months Ended June 30, 2022 | Six Months Ended June 30, 2021 | | :--- | :--- | :--- | :--- | :--- | | Net interest income | $105.95 | $108.05 | $207.40 | $212.65 | | Provision/ (credit) for credit losses | $3.05 | $(4.20) | $4.68 | $(38.91) | | Non-interest income | $35.25 | $26.26 | $55.84 | $55.13 | | Non-interest expense | $64.99 | $62.98 | $127.14 | $131.15 | | Net income | $54.80 | $57.26 | $98.74 | $132.73 | | Diluted net income per common share | $1.21 | $1.19 | $2.17 | $2.77 | - In Q1 2022, the Company transferred debt securities with an amortized cost of **$305.6 million** from the available-for-sale (AFS) category to held-to-maturity (HTM) to mitigate the impact of rising interest rates on tangible common equity[43](index=43&type=chunk) - Effective June 1, 2022, the Company sold substantially all assets of its insurance subsidiary, Sandy Spring Insurance Corporation, resulting in a **$16.7 million** gain on disposal of assets in Q2 2022[134](index=134&type=chunk)[165](index=165&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=39&type=section&id=Item%202.%20MANAGEMENT%27S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) Management discusses Q2 and H1 2022 financial results, noting a slight net income decrease, strong loan growth, stable net interest margin, and improved credit quality, supported by a stock repurchase program and subordinated debt issuance [Financial Performance](index=41&type=section&id=MD%26A_Financial_Performance) H1 2022 net income decreased to $98.7 million, primarily due to reduced PPP income and credit provisions, though non-interest income benefited from an insurance business sale gain offsetting a decline in mortgage banking income Key Performance Metrics (Q2 2022 vs. Q2 2021) | Metric | Q2 2022 | Q2 2021 | | :--- | :--- | :--- | | Net Income | $54.8M | $57.3M | | Diluted EPS | $1.21 | $1.19 | | Net Interest Margin | 3.49% | 3.63% | | ROA | 1.69% | 1.79% | | ROTCE (non-GAAP) | 20.42% | 20.44% | | Provision/(Credit) for Credit Losses | $3.0M | ($4.2M) | - Net interest income for H1 2022 decreased by **2%** to **$207.4 million**, primarily driven by a **$19.7 million** year-over-year reduction in interest and fees from the Paycheck Protection Program (PPP)[157](index=157&type=chunk) - Non-interest income for H1 2022 was supported by a **$16.7 million** gain on the disposal of the insurance business assets, which offset a **$12.2 million (76.3%)** decline in mortgage banking income due to the rising interest rate environment[165](index=165&type=chunk) - The company repurchased **625,710 shares** for **$25.0 million** in Q2 2022 under a new **$50.0 million** repurchase plan authorized in March 2022[84](index=84&type=chunk)[153](index=153&type=chunk) [Financial Condition](index=59&type=section&id=MD%26A_Financial_Condition) As of June 30, 2022, total assets grew to $13.3 billion, driven by loan and deposit growth, while stockholders' equity was impacted by rising rates, though capital ratios improved after a subordinated debt issuance Loan Portfolio Composition Change (H1 2022) | Loan Category | June 30, 2022 ($M) | Dec 31, 2021 ($M) | % Change | | :--- | :--- | :--- | :--- | | Commercial investor real estate | $4,761.7 | $4,141.3 | 15.0% | | Commercial business | $1,353.4 | $1,481.8 | (8.7)% | | Residential mortgage | $1,147.6 | $937.6 | 22.4% | | **Total loans** | **$10,786.3** | **$9,967.1** | **8.2%** | Capital Ratios | Ratio | June 30, 2022 | December 31, 2021 | | :--- | :--- | :--- | | Common equity tier 1 capital | 11.58% | 11.91% | | Total capital to risk-weighted assets | 16.07% | 14.59% | | Tangible common equity ratio (non-GAAP) | 8.45% | 9.21% | - Credit quality improved, with non-performing loans as a percentage of total loans decreasing to **0.40%** at June 30, 2022, from **0.49%** at December 31, 2021, and the allowance for credit losses stood at **1.05%** of total loans[220](index=220&type=chunk)[228](index=228&type=chunk)[233](index=233&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=70&type=section&id=Item%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company manages interest rate risk through ALCO, showing asset-sensitivity with NII projected to increase in rising rates, while EVE is projected to decrease, maintaining a strong liquidity position Interest Rate Sensitivity Analysis (as of June 30, 2022) | Change in Interest Rates | Estimated % Change in Net Interest Income (NII) | Estimated % Change in Economic Value of Equity (EVE) | | :--- | :--- | :--- | | +300 bp | +2.48% | (11.65)% | | +200 bp | +1.98% | (7.66)% | | +100 bp | +1.22% | (3.70)% | | -100 bp | (3.91)% | +2.58% | - The company's liquidity position is strong, with **$3.1 billion** in available borrowing capacity from the FHLB and **$684.9 million** from the Federal Reserve Bank as of June 30, 2022[258](index=258&type=chunk) [Controls and Procedures](index=70&type=section&id=Item%204.%20CONTROLS%20AND%20PROCEDURES) As of June 30, 2022, the company's disclosure controls and procedures were deemed effective, with no material changes to internal controls over financial reporting during Q2 2022 - Management concluded that the Company's disclosure controls and procedures were effective as of the end of the period covered by this report[266](index=266&type=chunk) - No changes in internal control over financial reporting occurred during Q2 2022 that have materially affected, or are reasonably likely to materially affect, these controls[266](index=266&type=chunk) PART II - OTHER INFORMATION [Legal Proceedings](index=71&type=section&id=Item%201.%20LEGAL%20PROCEEDINGS) The company is involved in various legal proceedings, but management does not anticipate a material adverse effect on financial condition, operating results, or liquidity - Management does not anticipate that ongoing litigation will have a material adverse effect on the Company's financial condition or results[267](index=267&type=chunk) [Risk Factors](index=71&type=section&id=Item%201A.%20RISK%20FACTORS) No material changes to the company's risk factors were reported from those disclosed in the Annual Report on Form 10-K for FY2021 - No material changes to risk factors were reported for the period[268](index=268&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=71&type=section&id=Item%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECU%20RITIES%20AND%20USE%20OF%20PROCEEDS) During Q2 2022, the company repurchased 625,710 shares of common stock as part of a $50.0 million plan, with $25.0 million remaining for future repurchases Share Repurchase Activity (Q2 2022) | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | May 2022 | 333,409 | $39.58 | | June 2022 | 292,301 | $40.34 | | **Total Q2** | **625,710** | **$39.93** | - As of June 30, 2022, a maximum value of **$25.0 million** may yet be purchased under the current stock repurchase plan[270](index=270&type=chunk) [Other Information and Exhibits](index=71&type=section&id=Item%203,%204,%205,%206) The company reported no defaults on senior securities, no mine safety disclosures, and no other material information, with Item 6 listing exhibits filed with the 10-Q report - Item 3, Defaults Upon Senior Securities: None[270](index=270&type=chunk) - Item 5, Other Information: None[271](index=271&type=chunk)

Financial Data and Key Metrics Changes - The company reported net income of $54.8 million, or $1.21 per diluted common share for Q2 2022, compared to $57.3 million or $1.19 per diluted common share for Q2 2021, and $43.9 million or $0.96 per diluted common share for Q1 2022 [10] - Core earnings were $44.2 million, down from $45.1 million for the linked quarter and $58.4 million for the prior year quarter, primarily due to the provision for credit losses and a decline in mortgage banking income [10][20] - Total assets increased to $13.3 billion, a 3% increase year-over-year from $12.9 billion, and a 2% increase from the linked quarter [12] - The provision for credit losses was $3 million, reflecting significant growth in the loan portfolio and management's assessment of recession probability [10][11] Business Line Data and Key Metrics Changes - Total loans, excluding PPP, increased 17% to $10.8 billion compared to $9.2 billion at June 30, 2021, with commercial loans growing by $1.3 billion or 17% [13] - Funded commercial loan production increased 60% to $805 million compared to $503 million for the same quarter of the prior year [14] - The consumer portfolio decreased by 7% year-over-year, while the pipeline remained robust at $1.5 billion [15] Market Data and Key Metrics Changes - Year-over-year deposits increased by 1%, driven by a 3% growth in noninterest-bearing deposits [17] - Interest-bearing deposits remained relatively unchanged at $6.8 billion [17] - Noninterest income increased by 34% or $9 million compared to the prior year quarter, primarily due to a $16.7 million gain from the sale of the insurance business [20] Company Strategy and Development Direction - The company completed the sale of its insurance business to enhance noninterest income and established a partnership with HUB International for improved insurance offerings [9][20] - The management emphasized a focus on strategically growing deposits to support continued loan growth [8] - The company aims to maintain a balance between commercial and commercial real estate transactions in its pipeline [15] Management Comments on Operating Environment and Future Outlook - Management acknowledged uncertainty in the marketplace but expressed confidence in client readiness to grow and the company's ability to support them [6][7] - The management expects continued solid loan growth, with a target of 8% to 10% growth for the year, although competitive pressures may affect this [35] - The company is closely monitoring asset quality and expects to maintain strong credit metrics despite potential recessionary pressures [26][27] Other Important Information - The tangible common equity ratio decreased to 8.45% of tangible assets, attributed to share repurchases and rising interest rates impacting the value of securities [28] - Noninterest expense increased by 3% compared to the prior year quarter, including transaction costs related to the sale of the insurance business [25] - The company received multiple workplace recognitions, including being named a top workplace by the Washington Post [30] Q&A Session Summary Question: What is driving the recent loan growth? - The primary driver of loan growth is the engagement of the broader team post-PPP, with a strong pipeline of opportunities despite local market disruptions [33][34] Question: How does the company view deposit growth and costs moving forward? - The company plans to match deposit growth with expected loan growth and may become more aggressive in pricing to remain competitive [40][41] Question: What are the expectations for expense growth in the second half of the year? - The company anticipates a year-over-year expense growth of around 4% to 5%, contingent on successful hiring and strategic initiatives [46][47] Question: How has the company managed to reduce nonperforming loans? - The reduction in nonperforming loans is attributed to resolving sizable relationships and conducting thorough portfolio reviews [59][60] Question: How does the company plan to handle deposit rates amid rising interest rates? - The company has been managing deposit rates on a case-by-case basis and anticipates needing to adjust rates more aggressively in response to Fed actions [61][62] Question: What is the impact of the insurance business sale on future revenues? - The insurance business contributed approximately $7 million in revenue and $6 million in expenses in 2021, which will be removed from future models [66]

Financial Performance - Net income was $54.8 million ($1.21 per diluted common share) compared to net income of $57.3 million ($1.19 per diluted common share) for the prior year quarter[6] - Core earnings were $44.2 million ($0.98 per diluted common share) compared to core earnings of $58.4 million ($1.23 per diluted common share) for the prior year quarter[6] - Pre-tax pre-provision net income was $76.2 million compared to $71.3 million for the prior year quarter[6] - Non-interest income increased by 34% or $9.0 million compared to the prior year quarter, primarily due to a $16.7 million gain from the disposition of the Company's insurance business[7,33] Balance Sheet - Total assets were $13.3 billion, a 3% increase compared to $12.9 billion at June 30, 2021; excluding PPP balances, total assets grew 10% year-over-year[8] - Total loans, excluding PPP loans, increased 17% to $10.8 billion compared to $9.2 billion at June 30, 2021[8] - Year-over-year deposits grew 1%, driven by 3% growth in noninterest-bearing deposits[8] Asset Quality - Non-performing loans to total loans was 0.40% compared to 0.93% at June 30, 2021[7] - Nonperforming loans totaled $43.5 million, compared to $94.3 million at June 30, 2021[7] - Allowance for credit losses on loans and leases was $113.7 million, or 1.05% of loan balances at June 30, 2022[59] Capital - Risk-based capital ratio of 16.07%, a common equity tier 1 risk-based capital ratio of 11.58%, a tier 1 risk-based capital ratio of 11.58%, and a tier 1 leverage ratio of 9.53%[7] - The company repurchased 625,710 shares of its common stock for $25.0 million at an average price of $39.93 per share during 2Q 2022[86]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the Quarterly Period Ended March 31, 2022 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to ____________ Commission File Number: 0-19065 SANDY SPRING BANCORP, INC. (Exact name of registrant as specified in its charter) Maryland 52-1532952 (State of incorporat ...