UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 _______________________________________________________________________________ ______________________________________________________________________________FORM 10-Q ☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended September 30, 2021 or ☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from ____ to ...

Webster Financial Corporation (NYSE:WBS) Q3 2021 Earnings Conference Call October 21, 2021 9:00 AM ET Company Participants Kristen Manginelli - Director, IR John Ciulla - Chairman, President, and CEO Glenn MacInnes - CFO Conference Call Participants Chris McGratty - KBW Matthew Breese - Stephens, Inc. Brock Vandervliet - UBS David Chiaverini - Wedbush Securities Steven Duong - RBC Capital Markets Laurie Hunsicker - Compass Point Jared Shaw - Wells Fargo Securities Ken Zerbe - Morgan Stanley Operator Good mo ...

Earnings Conference Call Third Quarter 2021 October 21, 2021 WEBSTER FINANCIAL CORPORATION Third Quarter 2021 Highlights | --- | --- | --- | |-----------------------------------------------------------------------------------------------------------|-----------------------------------|-----------------------------------| | | REPORTED | ADJUSTED | | Solid financial results and a favorable credit profile | $133.2M PPNR | $139.1M PPNR | | Loan growth of 2.7% quarter over quarter excluding PPP loans; average lo ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 _______________________________________________________________________________ ______________________________________________________________________________FORM 10-Q ☒ Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ending June 30, 2021 or ☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from ____ to ___ ...

Webster Financial Corporation (NYSE:WBS) Q2 2021 Earnings Conference Call July 22, 2021 9:00 AM ET Company Participants Kristen Manginelli - Director, IR John R. Ciulla - Chairman, President, and CEO Glenn I. MacInnes - CFO Conference Call Participants Matthew Breese - Stephens, Inc. David Chiaverini - Wedbush Securities Christopher McGratty - Keefe, Bruyette & Woods Brock Vandervliet - UBS Unidentified Analyst - Wells Fargo Securities Operator Good morning and welcome to the Webster Financial Corporation’s ...

Earnings Conference Call Second Quarter 2021 July 22, 2021 WEBSTER FINANCIAL CORPORATION Second Quarter 2021 Highlights | --- | --- | --- | |----------------------------------------------------------------------------------------------------------------|-----------------------------------|------------------------------------| | | REPORTED | ADJUSTED | | Solid financial results and a favorable credit profile Loan growth of 3.2% quarter over quarter | $106.5M PPNR | $124.8M PPNR | | excluding PPP loans Positi ...

PART I [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=5&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Webster Financial Corporation's Q1 2021 net income surged to $108.1 million, driven by reduced credit loss provisions, with total assets at $33.3 billion and a pending merger with Sterling Bancorp [Executive Summary](index=5&type=page&id=Executive%20Summary) Webster Financial Corporation announced a $5.1 billion merger with Sterling Bancorp and incurred $9.4 million in Q1 2021 costs for strategic initiatives - On April 19, 2021, Webster announced a definitive agreement to merge with Sterling Bancorp in an all-stock transaction valued at approximately **$5.1 billion**, expected to close in the fourth quarter of 2021[15](index=15&type=chunk) - Costs related to strategic initiatives in Q1 2021 totaled **$9.4 million**, comprising **$2.0 million** in severance, **$2.6 million** in facilities optimization, and **$4.8 million** in other project costs[16](index=16&type=chunk)[17](index=17&type=chunk) [Results of Operations](index=6&type=page&id=Results%20of%20Operations) Q1 2021 net income surged to $108.1 million, primarily driven by a $101.8 million decrease in credit loss provision, despite a slight decline in net interest income Q1 2021 vs Q1 2020 Financial Highlights | Metric | Q1 2021 | Q1 2020 | | :--- | :--- | :--- | | Net Income | $108.1 million | $38.2 million | | Diluted EPS | $1.17 | $0.39 | | Net Interest Income | $223.8 million | $230.8 million | | Provision for Credit Losses | ($25.8 million) | $76.0 million | | Net Interest Margin | 2.92% | 3.23% | | Return on Average Assets | 1.31% | 0.50% | | Return on Average Common Equity | 13.65% | 4.75% | - The significant increase in net income was primarily due to a **$101.8 million** decrease in the provision for credit losses, reflecting improvements in the forecasted economic outlook and favorable credit trends[25](index=25&type=chunk)[40](index=40&type=chunk) - Net interest margin decreased by **31 basis points** year-over-year to **2.92%**, attributed to lower loan and securities yields, partially offset by reduced deposit and borrowing costs and income from PPP loans[33](index=33&type=chunk) [Segment Reporting](index=12&type=page&id=Segment%20Reporting) Webster realigned segments in Q1 2021, with Commercial Banking's PPNR increasing by $27.6 million, HSA Bank's by $0.9 million, and Retail Banking's by $9.4 million - Effective January 1, 2021, the company realigned its segments, moving **$1.9 billion** in loans, **$2.2 billion** in deposits, and **$131.0 million** of goodwill from Retail Banking to Commercial Banking, with prior periods restated[53](index=53&type=chunk) Segment Pre-tax, Pre-provision Net Revenue (PPNR) - Q1 2021 vs Q1 2020 | Segment | Q1 2021 PPNR | Q1 2020 PPNR | Change | | :--- | :--- | :--- | :--- | | Commercial Banking | $102.4 million | $74.8 million | +$27.6 million | | HSA Bank | $32.9 million | $32.0 million | +$0.9 million | | Retail Banking | $28.8 million | $19.4 million | +$9.4 million | [Financial Condition](index=16&type=page&id=Financial%20Condition) As of March 31, 2021, total assets increased to $33.3 billion, driven by deposit growth, with the company remaining well-capitalized and a CET1 ratio of 11.89% - Total assets grew by **$0.7 billion** to **$33.3 billion** at March 31, 2021, primarily due to a **$1.1 billion** increase in deposits[73](index=73&type=chunk)[74](index=74&type=chunk) - The company and Webster Bank were considered well-capitalized at March 31, 2021, with a CET1 risk-based capital ratio of **11.89%**, and the company elected to delay the full impact of CECL on its regulatory capital until December 31, 2024[77](index=77&type=chunk) - The Board of Directors declared a quarterly cash dividend of **$0.40 per common share**, with restrictions on increasing this level due to the pending merger with Sterling[76](index=76&type=chunk) [Credit Quality](index=18&type=page&id=Credit%20Quality) Q1 2021 credit quality improved, with non-performing assets decreasing to $152.8 million and the Allowance for Credit Losses declining to $328.4 million due to an improved economic forecast Key Asset Quality Ratios | Ratio | March 31, 2021 | December 31, 2020 | | :--- | :--- | :--- | | Non-performing assets as a % of total assets | 0.46% | 0.52% | | ACL on loans as a % of total loans | 1.54% | 1.66% | | ACL on loans as a % of non-performing loans | 218.29% | 213.94% | | Net charge-offs as a % of average loans (annualized) | 0.10% | 0.21% | - The Allowance for Credit Losses (ACL) on loans and leases decreased by **$31.0 million** during the quarter to **$328.4 million**, attributed to improvements in the forecasted economic outlook and favorable credit trends[120](index=120&type=chunk) - As of March 31, 2021, loan balances associated with COVID-19 payment modifications still in their deferral period totaled approximately **$253.5 million**[94](index=94&type=chunk) [Sources of Funds and Liquidity](index=25&type=page&id=Sources%20of%20Funds%20and%20Liquidity) Deposits grew to $28.5 billion at March 31, 2021, reducing borrowed funds to $1.2 billion and improving the loan-to-deposit ratio to 74.8%, indicating strong liquidity - Total deposits increased to **$28.5 billion** at March 31, 2021, from **$27.3 billion** at December 31, 2020, primarily due to customer PPP loan funding, stimulus effects, and lower customer spending[128](index=128&type=chunk) - Total borrowed funds decreased to **$1.2 billion** (**3.6%** of total assets) from **$1.7 billion** (**5.2%** of total assets) at year-end, as deposit growth outpaced loan and securities growth[132](index=132&type=chunk) - The loan to total deposit ratio improved to **74.8%** at March 31, 2021, compared to **79.2%** at December 31, 2020[136](index=136&type=chunk) [Financial Statements](index=30&type=section&id=Item%201.%20Financial%20Statements) The Q1 2021 unaudited financial statements report total assets of $33.3 billion, net interest income of $223.8 million, and net income of $108.1 million, with diluted EPS of $1.17 Condensed Consolidated Balance Sheet Highlights (in thousands) | Account | March 31, 2021 | December 31, 2020 | | :--- | :--- | :--- | | Total Assets | $33,259,037 | $32,590,690 | | Loans and leases, net | $20,973,032 | $21,281,784 | | Total Deposits | $28,481,834 | $27,335,436 | | Total Liabilities | $29,986,109 | $29,356,065 | | Total Shareholders' Equity | $3,272,928 | $3,234,625 | Condensed Consolidated Statement of Income Highlights (in thousands) | Account | Three months ended March 31, 2021 | Three months ended March 31, 2020 | | :--- | :--- | :--- | | Net Interest Income | $223,764 | $230,801 | | Provision for credit losses | ($25,750) | $76,000 | | Non-interest Income | $76,757 | $73,378 | | Non-interest Expense | $187,982 | $178,836 | | Net Income | $108,078 | $38,199 | | Diluted EPS | $1.17 | $0.39 | [Notes to Condensed Consolidated Financial Statements](index=36&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail the pending Sterling merger, strategic initiative costs, segment reporting, investment and loan portfolios, credit quality, and regulatory capital ratios, confirming the company is well-capitalized [Note 3: Business Developments](index=38&type=page&id=Note%203%3A%20Business%20Developments) This note details the pending all-stock merger with Sterling Bancorp and the $9.4 million in Q1 2021 costs incurred for strategic initiatives - On April 19, 2021, Webster and Sterling announced a definitive agreement to combine in an all-stock transaction valued at approximately **$5.1 billion**, expected to close in Q4 2021[187](index=187&type=chunk) Strategic Initiatives Reserve Activity (Q1 2021, in thousands) | Category | Beginning Balance | Charged to Earnings | Cash Payments | Ending Balance | | :--- | :--- | :--- | :--- | :--- | | Severance | $17,675 | $2,060 | ($1,365) | $18,370 | | Other | $2,120 | $7,202 | ($3,143) | $4,545 | | **Total** | **$19,795** | **$9,441** | **($4,508)** | **$22,915** | [Note 5: Loans and Leases](index=43&type=page&id=Note%205%3A%20Loans%20and%20Leases) Total loans and leases were $21.3 billion at March 31, 2021, with an ACL of $328.4 million and non-accrual loans of $150.4 million, detailed by portfolio composition and credit quality Loan and Lease Portfolio Composition (in thousands) | Portfolio | March 31, 2021 | December 31, 2020 | | :--- | :--- | :--- | | Commercial | $14,775,543 | $14,900,535 | | Consumer | $6,525,840 | $6,740,680 | | **Total** | **$21,301,383** | **$21,641,215** | Allowance for Credit Losses (ACL) Activity (Q1 2021, in thousands) | Description | Commercial | Consumer | Total | | :--- | :--- | :--- | :--- | | Beginning Balance | $312,244 | $47,187 | $359,431 | | (Benefit) Provision | ($23,653) | ($2,106) | ($25,759) | | Net Charge-offs | ($4,685) | ($636) | ($5,321) | | **Ending Balance** | **$283,906** | **$44,445** | **$328,351** | [Note 12: Regulatory Matters](index=57&type=page&id=Note%2012%3A%20Regulatory%20Matters) Webster Financial Corporation and Webster Bank remained well-capitalized as of March 31, 2021, exceeding all minimum regulatory capital requirements, with a CET1 ratio of 11.89% Webster Financial Corporation Capital Ratios (March 31, 2021) | Ratio | Actual | Minimum Requirement | Well Capitalized Requirement | | :--- | :--- | :--- | :--- | | CET1 risk-based capital | 11.89% | 4.5% | 6.5% | | Tier 1 risk-based capital | 12.55% | 6.0% | 8.0% | | Total risk-based capital | 14.08% | 8.0% | 10.0% | | Tier 1 leverage capital | 8.45% | 4.0% | 5.0% | PART II – OTHER INFORMATION [Risk Factors](index=71&type=page&id=Item%201A.%20Risk%20Factors) This section outlines new risks related to the pending Sterling merger, including completion uncertainty, integration challenges, and the potential failure to realize anticipated benefits - The completion of the merger with Sterling is contingent on satisfying numerous conditions, including regulatory and shareholder approvals, which are not guaranteed[313](index=313&type=chunk) - While the merger is pending, Webster faces business uncertainties and contractual restrictions that could adversely affect operations, customer relationships, and employee retention[315](index=315&type=chunk) - There is a risk that Webster may fail to realize the anticipated benefits and cost savings from the merger, or that integration of the significantly larger, combined business could present substantial challenges[316](index=316&type=chunk)[317](index=317&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=72&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) In Q1 2021, Webster purchased 70,048 shares for stock compensation, while its formal $123.4 million repurchase program remains suspended due to the pending Sterling merger - In Q1 2021, the company purchased **70,048 shares** at an average price of **$55.79 per share**, all related to stock compensation plan activity and not part of the formal repurchase program[321](index=321&type=chunk) - The company's common stock repurchase program, with **$123.4 million** available, is currently suspended due to the pending merger with Sterling and no shares may be purchased under it until the transaction is closed[322](index=322&type=chunk)

Financial Data and Key Metrics Changes - Webster reported net income of $106 million or $1.17 per share, up from $0.64 per share in the prior quarter, with adjusted net income at $112 million or $1.25 per share, resulting in a 14.6% return on average common equity and a 17.9% return on tangible common equity [39][40] - Tangible book value grew 1.3% linked quarter and 7.4% from the prior year [40] - Adjusted net interest income increased by $3 million linked quarter, driven largely by PPP fee accretion [40] Business Line Data and Key Metrics Changes - Adjusted NIM improved by four basis points linked quarter to 2.92%, attributed to lower funding costs and PPP fee accretion [41] - Loan originations, excluding PPP loans, totaled $1.3 billion, increasing $100 million from the prior year [41] - HSA Bank opened 264,000 new accounts and crossed the $10 billion mark in total footings [47] Market Data and Key Metrics Changes - Average loans declined $250 million or 1% from Q4, while average deposits grew $1 billion from Q4 or 4% [46] - Sterling reported adjusted EPS of $0.51, up from $0.49 in the fourth quarter, with tangible book value per share growing to $14.08 from $13.87 [49] Company Strategy and Development Direction - The merger aims to create a differentiated, commercially focused, high-performing franchise with strong market share from metro New York to metro Boston [7][10] - The combined company will focus on enhancing HSA Bank's proprietary technology and product offerings, leveraging scale for growth [16][30] - The strategy includes significant investments in technology solutions and risk management systems to support growth [9][13] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving high single-digit to 10% loan growth in a normalized demand environment, emphasizing the strength of the commercial loan portfolio [61][70] - The combined entity is well-positioned for rising interest rates, with 80% of the loan portfolio being commercial and 60% floating [65][66] - Management highlighted the importance of maintaining a strong culture and accountability within the combined organization to drive performance [22][36] Other Important Information - The merger is structured as a 100% stock merger of equals, with Sterling shareholders receiving a fixed exchange ratio of 0.463 shares of Webster for each share they own [23][26] - The transaction is expected to close in the fourth quarter of the year, with significant cost savings identified at $120 million pre-tax [27][28] Q&A Session Summary Question: Growth pro forma and combined growth rate - Management indicated that they expect high single-digit to 10% loan growth on an organic basis, with no significant repositioning required [61][62] Question: Rate positioning pro forma - The combined company is well-positioned for rising rates, with a significant portion of the loan portfolio being floating and adjustable [65][66] Question: Consumer portfolio impact on growth - Management clarified that while the consumer portfolio may not grow as quickly, the strong commercial bank portfolio will support overall loan growth [70] Question: HSA growth outlook - Management expressed optimism about HSA growth, anticipating normalized account growth as the pandemic settles [75] Question: Technology platforms and synergies - Management discussed the potential for significant IT synergies and the opportunity to enhance technology offerings through the merger [84][85]

Financial Highlights - Reported Pre-Provision Net Revenue (PPNR) was $112.5 million, while adjusted PPNR reached $121.9 million[2] - Income available to common shareholders was reported at $105.5 million, with an adjusted figure of $112.4 million[2] - Diluted Earnings Per Share (EPS) were $1.17 reported and $1.25 adjusted[2] - Return on Average Common Equity (ROACE) was 13.65% reported and 14.55% adjusted[2] - Return on Average Tangible Common Equity (ROATCE) was 16.79% reported and 17.88% adjusted[2] Strategic Initiatives & Expense Management - The company anticipates an 8-10% net reduction in operating expenses through strategic initiatives[5] - Net project savings of $13 million are forecasted for 4Q21, reflecting run-rate operating expense benefits[9] Balance Sheet & Loan Portfolio - HSA Bank footings increased by 23.1% year-over-year, reaching $10.6 billion[2] - Total loans experienced a year-over-year growth of 2.0%, but declined by 4.3% excluding PPP loans[12, 14] - Total deposits grew by 16.2% year-over-year, reaching $4.0 billion[15, 16] - The loan-to-deposit ratio improved to 74.8%[19, 48]

Table of Contents 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, 2020 or ☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period f ...