Financial Performance - Net income available to common shareholders decreased by $50.1 million or 22.6% to $182.0 million in 2022 compared to 2021[200]. - Net interest income increased by $16.4 million or 3.6% from 2021, primarily due to loan growth and a rising rate environment[200]. - Non-interest income decreased by $15.4 million or 11.6% in 2022, primarily due to a $14.4 million decrease in mortgage banking income[200]. - Total shareholders' equity decreased to $2,426,662, down from $2,693,166 in 2021, representing a decline of 9.9%[210]. - Net income available to common shareholders was $181,988 in 2022, down 21.5% from $232,135 in 2021[210]. - Earnings per common share—diluted decreased to $3.02 in 2022 from $3.53 in 2021[205]. - Return on average tangible equity decreased to 13.78% in 2022 from 14.89% in 2021, a decline of 1.11 percentage points[210]. - Tangible book value per share at year-end was $19.43, down from $22.61 in 2021, a decrease of 9.7%[210]. - Efficiency ratio increased to 59.53% in 2022 from 58.22% in 2021, indicating a decline in operational efficiency[210]. - Average total assets remained relatively stable at $16,879,541 in 2022 compared to $16,928,377 in 2021[212]. Capital and Ratios - As of December 31, 2022, Wesbanco's Common Equity Tier 1 (CET1) ratio was 11.20%, Tier 1 capital ratio was 12.33%, and total capital ratio was 15.11%, all exceeding minimum requirements[61]. - Tier I risk-based capital ratio was 12.33% and total risk-based capital was 15.11% as of December 31, 2022, both well above regulatory standards[202]. - Wesbanco's leverage ratio was 9.90% as of December 31, 2022, indicating strong capital adequacy[61]. - The allowance for credit losses - loans to total loans ratio was 1.10% in 2022, down from 1.25% in 2021[205]. - Tangible common equity to tangible assets ratio fell to 7.28% in 2022 from 8.92% in 2021, a decrease of 1.64 percentage points[210]. Assets and Liabilities - As of December 31, 2022, Wesbanco's total assets were approximately $16.9 billion, with a market value of assets under management in the trust and investment services segment at approximately $4.9 billion[14]. - Total portfolio loans increased by $1.0 billion or 10.0% year-over-year, reaching $10.7 billion as of December 31, 2022[201]. - As of December 31, 2022, approximately 20% of Wesbanco's loan portfolio was comprised of residential real estate loans, and 57% was comprised of commercial real estate loans[121]. - Wesbanco had $133.5 million in junior subordinated debt as of December 31, 2022, with Trust Preferred Securities totaling $130.0 million previously included in Tier 1 capital[110]. Employee and Workforce - Wesbanco employed 2,426 full-time equivalent employees as of December 31, 2022, with an average tenure of approximately 10 years for all employees and over 16 years for executive officers[27]. - The turnover rate for Wesbanco in 2022 was 18.98%, while the turnover rate for officers was significantly lower at 9.13%[28]. - The company has a diverse workforce, with 9.6% of employees being minorities and 53.6% of total officers being women[28]. Community Engagement and Philanthropy - Wesbanco made over $1.2 million in philanthropic donations in support of communities across its footprint during the past year[33]. - Wesbanco originated over $1.9 billion in community development loans in the past five years, supporting local communities[97]. - The Wesbanco Bank Community Development Corporation has made over 219 loans totaling over $167 million, creating over 6,200 jobs in distressed communities[96]. - Wesbanco received an "Outstanding" CRA rating from the FDIC for community development performance for the period of October 2016 through July 2019[95]. Regulatory Environment - Wesbanco is subject to enhanced prudential supervision due to exceeding the $10 billion asset threshold, requiring compliance with additional regulations[36]. - The company is classified as a large bank due to total assets exceeding $10 billion, subjecting it to more continuous oversight by the FDIC[52]. - Wesbanco is subject to the Durbin Amendment, which caps debit card interchange fees at $0.21 plus an additional 0.05% of the transaction value, affecting its interchange income since it has assets exceeding $10 billion[77]. - The Dodd-Frank Act requires annual company-run stress tests for bank holding companies with total consolidated assets greater than $100 billion, but Wesbanco is not subject to these rules as it has less than $100 billion in average total consolidated assets[78]. - The Volcker Rule limits Wesbanco's ability to engage in proprietary trading and invest in hedge funds, with compliance requirements adjusted for its trading asset levels[72]. Market and Competition - The company faces intense competition from various financial institutions, including local, regional, and national banks, which may impact its market share and profit potential[34]. - The company operates in a highly competitive banking environment, facing competition from various financial institutions, including major national banks and fintech companies, which could impact customer retention and growth[133]. Risk Factors - Economic downturns in Wesbanco's primary markets could negatively impact earnings and the ability of customers to repay loans, potentially leading to higher charge-offs and increased allowance for credit losses[107]. - Changes in federal policies and regulations could adversely affect Wesbanco's business operations and financial condition, including potential increases in operational costs and limitations on financial services[108]. - Severe weather, natural disasters, and other external events could significantly impair Wesbanco's ability to conduct business and affect its deposit base and loan repayment capabilities[112]. - A high percentage of Wesbanco's loan portfolio is concentrated in economically vulnerable regions, making it more susceptible to local economic downturns compared to more diversified institutions[121]. - Inflation could significantly affect interest rates and financial performance, with Wesbanco monitoring interest-rate sensitive assets and liabilities to mitigate impacts[120]. Shareholder Information - Wesbanco's total shareholder return was 109.86 as of December 31, 2022, compared to 100.00 at the end of 2017, indicating a growth of approximately 9.86% over the five-year period[176]. - The Russell 2000 Index and S&P Regional Banks Select Industry Index had total shareholder returns of 122.41 and 114.88, respectively, as of December 31, 2022[176]. - The ability to pay dividends on common stock is limited by the outstanding Series A Preferred Stock, which requires full dividends to be paid before any common stock dividends can be declared[156]. - Dividends declared per common share increased to $1.37 in 2022 from $1.32 in 2021, an increase of 3.8%[212]. Technological and Operational Developments - Wesbanco's future success depends on its ability to keep pace with technological changes and customer demands, having completed a core banking software conversion in 2021[155]. - The company has implemented an enterprise risk management framework to manage various risk exposures, including credit, operational, and reputational risks[148]. - Wesbanco's reliance on third-party vendors for processing transactions poses risks, as any failure in their systems could disrupt business operations[153].
WESBANCO REPSTG(WSBCP) - 2022 Q4 - Annual Report