Investor Presentation (Q2 2021) (WSBC financials as of the three months ended 31 March 2021)
John Iannone Senior Vice President, Investor & Public Relations 304-905-7021 Forward-Looking Statements and Non-GAAP Financial Measures
Forward-looking statements in this report relating to WesBanco’s plans, strategies, objectives, expectations, intentions and adequacy of resources, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The information contained in this report should be read in conjunction with WesBanco’s Form 10-K for the year ended December 31, 2020 and documents subsequently filed by WesBanco with the Securities and Exchange Commission (“SEC”), which are available at the SEC’s website, www.sec.gov or at WesBanco’s website, www.WesBanco.com. Investors are cautioned that forward-looking statements, which are not historical fact, involve risks and uncertainties, including those detailed in WesBanco’s most recent Annual Report on Form 10-K filed with the SEC under “Risk Factors” in Part I, Item 1A. Such statements are subject to important factors that could cause actual results to differ materially from those contemplated by such statements, including, without limitation, the effects of changing regional and national economic conditions including the effects of the COVID-19 pandemic; changes in interest rates, spreads on earning assets and interest-bearing liabilities, and associated interest rate sensitivity; sources of liquidity available to WesBanco and its related subsidiary operations; potential future credit losses and the credit risk of commercial, real estate, and consumer loan customers and their borrowing activities; actions of the Federal Reserve Board, the Federal Deposit Insurance Corporation, the SEC, the Financial Institution Regulatory Authority, the Municipal Securities Rulemaking Board, the Securities Investors Protection Corporation, and other regulatory bodies; potential legislative and federal and state regulatory actions and reform, including, without limitation, the impact of the implementation of the Dodd-Frank Act; adverse decisions of federal and state courts; fraud, scams and schemes of third parties; cyber-security breaches; competitive conditions in the financial services industry; rapidly changing technology affecting financial services; marketability of debt instruments and corresponding impact on fair value adjustments; and/or other external developments materially impacting WesBanco’s operational and financial performance. WesBanco does not assume any duty to update forward-looking statements.
In addition to the results of operations presented in accordance with Generally Accepted Accounting Principles (GAAP), WesBanco's management uses, and this presentation contains or references, certain non-GAAP financial measures, such as pre-tax pre-provision income, tangible common equity/tangible assets; net income excluding after-tax restructuring and merger-related expenses; efficiency ratio; return on average assets; and return on average tangible equity. WesBanco believes these financial measures provide information useful to investors in understanding our operational performance and business and performance trends which facilitate comparisons with the performance of others in the financial services industry. Although WesBanco believes that these non- GAAP financial measures enhance investors' understanding of WesBanco's business and performance, these non-GAAP financial measures should not be considered an alternative to GAAP. The non-GAAP financial measures contained therein should be read in conjunction with the audited financial statements and analysis as presented in the Annual Report on Form 10-K as well as the unaudited financial statements and analyses as presented in the Quarterly Reports on Forms 10-Q for WesBanco and its subsidiaries, as well as other filings that the company has made with the SEC. 1 Evolving Regional Financial Services Institution
Strong market Strong Market Presence in Major Markets presence across legacy and major #16 in OH Pittsburgh Wheeling metropolitan markets #11 Pgh Indianapolis MSA Dayton Columbus #9 in MD Morgantown Balanced loan and Baltimore Cincinnati deposit distribution Washington D.C. #3 in WV
across diverse Lexington Park #11 in KY Huntington Charleston regional footprint Louisville Frankfort Lexington Fort Knox Diversified revenue Broad and Balanced Market Distribution Deposits generation engines Loans WV MD supported by unique MD 19% 17% WV long-term advantages 24% 29% KY 15% KY OH Well-executed long- IN 14% 26% OH IN 5% PA term growth strategies 5% PA 21% 12% 13%
Note: loan and deposit data as of 3/31/2021 (loans exclude Small Business Administration’s Paycheck Protection Program (“SBA PPP”) loans); location data as of 5/1/2021; market 2 share based on 2020 deposit rankings (exclusions: Pittsburgh MSA – BNY Mellon; state of OH – National Consumer Cooperative Bank) (source: S&P Global Market Intelligence) Investment Rationale
Balanced loan and deposit distribution across footprint Balanced and Diversified earnings streams built for long-term success, led by Diversified with century-old, $5.2B trust and wealth management business Unique Long- Strong presence in economically diverse, major markets Term Advantages supported by positive demographic trends Robust legacy deposit base provides pricing advantage
Emphasis on digital capabilities and customer service to ensure relationship value that meets customer needs efficiently and Distinct and effectively Well-Executed Established lending and wealth management teams Long-Term Growth Strategies Focus on positive operating leverage built upon a culture of expense management, enhanced by consolidated back-office functions in lower cost markets
Legacy of Credit Well-capitalized with solid liquidity and strong credit quality and Quality, Risk regulatory compliance Management, and Seven consecutive “outstanding” CRA ratings since 2003 Shareholder Critical, long-term focus on shareholder return through earnings Focus growth and effective capital management
3 Note: trust assets under management as of 3/31/2021 Strategies for Long-Term Success Long-Term Growth Strategies
Diversified Digital Loan Franchise- Long History Banking Portfolio Enhancing of Strong Service with C&I Expansion Wealth Strategies and Home within Management & Core Lending Contiguous Capabilities Deposit Focus Markets Advantage
Focus on Delivering Positive Operating Leverage
Strong Legacy of Credit Quality, Risk Management, and Compliance
5 Diversified Loan Portfolio
Focus on strategic diversification, $10.7 Billion Loan Portfolio
growth, and credit quality Commercial Comm'l R/E: & Industrial . Balance disciplined loan origination Improved 15% Property with prudent lending standards 47% SBA PPP . Focus on C&I and home equity lending 8% . Key offerings include treasury Consumer management, foreign exchange, cyber 3% HELOC security, and lockbox services 6% Comm'l R/E: Land, . Strong residential mortgage program Construction Residential R/E 6% 15% Average loans to average deposits ratio of 85.3% provides opportunity for continued loan growth . Low cost of deposits provides a competitive advantage in the typical higher cost Mid-Atlantic market
Manageable lending exposures
De-emphasized consumer and several CRE categories in recent years
6 Note: loan and deposit data as of quarter ending 3/31/2021 Strong Wealth Management Capabilities
Trust & Investments Insurance Trust Assets $5.2B of trust and mutual fund (Market Value as of 12/31) ($B) Personal, commercial, title, assets under management $5.2 health, and life $4.3 CAGR 6,000+ relationships $3.2 4.6% Expand title business in all $2.3 $2.4 Growth opportunities from markets shale-related private wealth Applied quotation software 2002 2008 2012 2018 2021 management 3/31 utilization (personal) Expansion opportunities in Third-party administrator (TPA) KY, IN, and the Mid-Atlantic services for small business WesMark Funds – six healthcare plans proprietary funds across equities, bonds, and tactical assets
Securities Brokerage Private Banking Securities investment sales $980MM in private banking loans and deposits Licensed banker program Private Banking Loans and Deposits (as of 12/31) ($MM) Investment advisory services 3,350+ relationships $980 Regional player/coach program $770 Growth opportunities from $540 CAGR 37% shale-related private wealth Expand external business $270 $100 development opportunities management 2013 2015 2017 2019 2021 Expansion opportunities in KY, Expansion opportunities in KY, 3/31 IN, and Mid-Atlantic Loans Deposits IN, and Mid-Atlantic
7 Note: assets, loans, deposits, and clients as of 12/31/2020; chart financials as of 12/31 unless otherwise stated Digital Platforms Drive Engagement & Efficiency Digital banking utilization . ~74% of retail customers utilize online digital banking services . ~4.5 million web and mobile logins per month • Mobile 50% of total, with an average of 17 monthly logins per customer . Mobile wallet & mobile deposits increased 55% & 50% YoY, respectively . Zelle® to be utilized as a payment service beginning 2H2021 Digital acquisition . ~50% of residential mortgage applications submitted via online portal . ~200 deposit accounts opened per month . WesBanco Insurance Services launched white-label insurance capabilities with a web-based term-life insurance platform, and a fully-integrated digital property & casualty insurance for consumers and small businesses Core upgrade in 2021 . Omni-channel presence – real-time account activity across all channels . Improved customer service through reduced manual activities . More efficient processing cost structure Cloud-based architecture utilization . Early adoption to leverage modernized data and application platforms, combined with significant expense and performance benefits . Actively harnessing advanced artificial intelligence (AI) and robotic process automation (RPA) technologies to automate business processes Note: digital statistics as of 1Q2021; online residential mortgage applications and deposit account opening capabilities launched July 2019; WesBanco Insurance Services online term-life and P&C 8 insurance capabilities launched November 2020 and January 2021, respectively Benefits of Core Deposit Funding Advantage
Robust legacy deposit base, enhanced by shale energy-related royalties, provides funding advantage in Mid-Atlantic market Reflecting the significantly lower interest rate environment, aggressively reduced deposit rates since March 2020 During the last five years: . Total deposits (excluding CDs) have grown organically at a 11% CAGR . Total demand deposits have grown organically at a 15% CAGR to represent ~57% of total deposits
Avg Deposits as of 3/31/2016 Avg Deposits as of 3/31/2020 Avg Deposits as of 3/31/2021
CDs Non-int Non-int CDs CDs 12% Bearing Bearing Non-int 26% 18% DD DD Bearing 33% 21% Total DD 29% DD Savings 40% 18% Total Total DD Int Savings DD 56% Bearing 18% 50% DD 19%
Savings Int Money Int 18% Bearing Mkt Bearing Money Money 14% DD Mkt DD Mkt 21% 23% 16% 14% Funding Cost Funding Cost Funding Cost Interest-Bearing = 0.32% Interest-Bearing = 0.55% Interest-Bearing = 0.20% Total Deposits = 0.25% Total Deposits = 0.39% Total Deposits = 0.14% [Peer Average Total Deposit Cost = 0.29%] [Peer Average Total Deposit Cost = 0.67%] [Peer Average Total Deposit Cost = 0.21%]
Note: text reflects period-end data and pie charts reflect quarterly averages; peer bank group includes all U.S. banks with total assets of $10B to $25B (as of most recent period) 9 from S&P Global Market Intelligence (as of 5/3/2021) and represent simple averages Franchise Expansion
Targeted acquisitions in existing Contiguous Markets Radius markets and new higher-growth metro areas
ESB & FSBI
AmTrust Long-term focus on appropriate branches
capital management to enhance OAKF shareholder value OLBK FFKT FTSB YCB Strong capital and liquidity, along with strong regulatory compliance processes, provides ability to execute transactions quickly Franchise-Enhancing Acquisitions Diligent efforts to maintain a OLBK: announced Jul-19; closed Nov-19 community bank-oriented, value- FFKT: announced Apr-18; closed Aug-18 based approach to our markets FTSB: announced Nov-17; closed Apr-18 YCB: announced May-16; closed Sep-16 ESB: announced Oct-14; closed Feb-15 History of successful acquisitions FSBI: announced Jul-12; closed Nov-12 that have improved earnings AmTrust: announced Jan-09; closed Mar-09 OAKF: announced Jul-07; closed Nov-07 10 Note: AmTrust was an acquisition of five branches Focus on Positive Operating Leverage
Disciplined growth, balanced by a fundamental focus on expense management and supported by franchise-enhancing acquisitions, in order to deliver positive operating leverage and enhance shareholder value Start of “Durbin Pandemic & ESB YCB Amendment” Fed Funds Merger Merger Impact Begun Rate Cut to Assets Fidelity (Feb-15) (Sep-16) (Jul-19) 0.0-0.25% up 218% Merger (Mar-20) Efficiency Ratio (Nov-12) down 410bp $10B Asset FTSB Merger OLBK Lending & Revenue Threshold (Apr-18) Merger Diversification Preparations FFKT Merger (Nov-19) Strategy Begun Begun (Aug-18)
$18.0 60.81% 60.98% 60.99% 62.00% $17.0 $16.0 59.50% 59.59% $15.0 60.00%
$14.0
$13.0 $12.0 57.05% 56.69% 56.68% 56.71% 58.00% $11.0 56.44% 56.38% $10.0
$9.0 56.00%
$8.0 54.60%
$7.0
$6.0 54.00%
$5.0
$4.0
$3.0 52.00%
$2.0 $1.0 $5.4 $5.5 $6.1 $6.1 $6.3 $8.5 $9.8 $9.8 $12.5 $15.7 $16.4 $17.1
$0.0 50.00% 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 3/31 Operating Leverage 9.6x 4.2x 0.7x 1.6x 10.9x 2.2x 1.9x 1.8x 2.5x 1.4x 1.8x 2.2x Assets ($B) Efficiency Ratio (YTD)
Note: financial data as of 12/31; current year-to-date (YTD) data as of 3/31/2021; balance sheet data as of period ends; Efficiency Ratio presented on a fully taxable-equivalent (FTE) 11 and annualized basis; please see the reconciliations in the appendix Strong Risk Management and Capital Position Strong legacy of credit and risk management and regulatory compliance . Based upon conservative underwriting standards and approval processes supported by centralized back-office and loan funding functions Mature enterprise risk management program headed by Chief Risk Officer addressing key risks in all business lines and functional areas Enhanced compliance and risk management system and testing platform . Strong and scalable BSA/AML function . Examined by CFPB for consumer compliance supervision Seven consecutive “outstanding” CRA ratings since 2003 Strong and improving regulatory capital ratios significantly above regulatory requirements, and high tangible common equity (TCE) levels Tier 1 Risk-Based Capital Ratio Tier 1 Leverage Capital Ratio
10.59% 13.66% 10.47% 13.41% 10.27% 12.81% 12.90% 9.85% 12.66% memo 9.56% memo Well- Well- Capitalized Capitalized 8.0% 5.0% 14.12% 15.09% 12.89% 14.72% 14.95% Required 10.39% 10.74% 11.30% 10.51% 10.74% Required 6.0% 4.0% 2017 2018 2019 2020 1Q21 2017 2018 2019 2020 1Q21 WSBC $10-25B Banks WSBC $10-25B Banks Note: capital ratios enhanced by August 2020 issuance of $150MM of preferred stock; effective 4Q2019, as required by the Dodd- Frank Act for financial institutions with total assets >$15B, Tier 1 Capital Ratios negatively impacted by the movement of ~$130MM of TruPS from Tier 1 to Tier 2 risk-based capital; peer bank group includes all U.S. banks with total 12 assets of $10B to $25B (as of each period) from S&P Global Market Intelligence (as of 5/3/2021) and represent simple averages Recent Successes and Accolades Based 100% on customer satisfaction and consumer feedback, WesBanco Bank was again named, for the third year, one of the World’s Best Banks in an independent ranking WesBanco Bank received the America Saves Designation of Savings Excellence for Banks, a designation from America Saves For the 11th time since the list’s inception in 2010, WesBanco Bank was named to the Forbes list of the Best Banks in America – coming in as the 12th best bank Named to Newsweek magazine's inaugural ranking of America's Best Banks, recognizing those banks that best serve their customers needs, as well as being named the Best Big Bank in the state of West Virginia Bauer Financial again awarded WesBanco their highest rating as a “five-star” bank The Central Ohio market of WesBanco Bank was awarded a “Top Workplaces” honor by Columbus C.E.O. magazine for the fifth consecutive year The Western Pennsylvania market of WesBanco Bank was awarded a “Top Workplaces” honor by The Pittsburgh Post Gazette for the third consecutive year The FDIC awarded WesBanco Bank it’s 7th consecutive composite “Outstanding” rating for its most recent CRA performance Kroll Bond Rating Agency assigned senior unsecured debt ratings of BBB+ to WesBanco, Inc. and A- to WesBanco Bank, Inc. 13 Note: Kroll Bond Rating Agency rating report issued 8/4/2020 Financial Overview Q1 2021 Financial and Operational Highlights Strong growth in pre-tax, pre-provision income Pre-Tax, Pre-Provision Income(1) $64.2 million, +3.6% YoY Continued emphasis on expense management
Improving macro-economic factors drove a $28 Net Income Available to Common (1) million release of provision for credit losses Shareholders and Diluted EPS $71.3 million; $1.06/diluted share Key credit quality metrics remained at low levels and favorable to peer bank averages Efficiency Ratio(1) 56.71% Positive growth in both loans and deposits
Mortgage banking income increased due to a Mortgage Banking Income high volume of originations $4.3 million, +234.2% YoY
WesBanco is well-capitalized with solid liquidity Loan Growth and a strong balance sheet +3.4% YoY . Recent Board authorized stock repurchase program, when combined with the remainder of the previous authorization, represents approximately Deposit Growth (x-CDs) 5% of outstanding shares +28.9% YoY
Note: financial and operational highlights during the quarter ended March 31, 2021; loan growth includes approximately $824 million of loans funded through the Small Business Administration’s Paycheck Protection Program (“SBA PPP”), as established by the CARES Act 15 (1) Non-GAAP measure – please see reconciliation in appendix Q1 2021 Total Portfolio Loans ($MM)
~7,750 SBA PPP loans totaling ~$824 million (as of 3/31/2021) . During Q1 2021, ~2,330 customers applied for and received forgiveness of their 2020 SBA PPP loans totaling $223 million; and, assisted >3,240 businesses with 2021 SBA PPP loans totaling ~$344 million
C&I loan levels (x-SBA PPP) were down year-over-year primarily due to lower utilization of revolving lines of credit (~33% vs. ~43% last year)
Q1 2021 residential real estate loan levels impacted by retaining ~40% of the $326 million of origination dollar volume (~57% refi) on balance sheet
Home equity and consumer loan levels negatively impacted by payoffs driven by utilization of residential mortgage refinancing and higher personal savings 16 Q1 2021 Net Interest Margin (NIM)
NIM negatively impacted by the low interest rate environment
As a result of higher cash balances, investment securities increased by $0.9 billion during Q1 2021, mostly during March
Aggressively reduced deposit rates throughout the past year . Q1 2021 interest-bearing deposit funding costs 20bp, or, when including non-interest bearing 1Q2021 Commercial Loan Portfolio Index Mix deposits, 14bp Variable Commercial Loan Repricing Variable 48 to 60 Rate Months >60 Months 65% 47% 3% Period-end FHLB borrowings of $0.4 billion, with remaining average
Fixed life of less than one year, down $1.2 Rate 35% 24 to 48 billion year-over-year Months 3% 3 to 24 <3 Months Months 44% SBA PPP loans benefited Q1 2021 3% ~$2.4MM of the commercial portfolio has floors, with NIM by a net 11bp, mainly due to ~68% of these currently at their floors of 4.10% (avg) 2020 SBA PPP originations forgiven
17 Note: commercial loan portfolio index mix excludes SBA PPP loans Q1 2021 Non-Interest Income
Quarter Ending % H / (L) % H / (L) Mortgage banking fees increased due to an ~50% year-over-year ($000s) 03/31/21 03/31/20 12/31/20 increase in 1-to-4 family residential mortgage origination dollar volume, Trust fees $7,631 9.8% 13.0% and the associated sale of ~60% of those into the secondary market Service charges on deposits 4,894 (26.0%) (13.7%) Trust fees increased due to equity market improvement and organic Electronic banking fees 4,365 2.6% (1.3%) growth in trust assets Net securities brokerage revenue 1,524 (9.2%) 8.7% Other income increased due to higher loan swap-related income, Bank-owned life insurance 1,709 (3.4%) (2.4%) which was primarily the result of $2.8 million of fair market value Mortgage banking income 4,264 234.2% (21.6%) adjustments in the current period as compared to a negative $2.8 million Net securities gains 279 (81.3%) (59.7%) adjustment last year
Net gain on OREO & other assets 175 3.6% nm Service charges on deposits were lower due to higher consumer Other income 8,367 120.1% 27.7% deposits associated with the three rounds of stimulus to-date and Total non-interest income $33,208 18.6% 1.5% lower general consumer spending, resulting in fewer eligible account fees 18 Note: OREO = other real estate owned Q1 2021 Non-Interest Expense
Quarter Ending % H / (L) % H / (L) Total operating expenses remained well-controlled through company- ($000s) 03/31/21 03/31/20 12/31/20 wide efforts to manage open positions and certain discretionary Salaries and wages $36,890 (5.2%) (5.7%) expenses
Employee benefits 10,266 (1.0%) (3.2%) . Efficiency ratio improved 98bp year- over-year to 56.71% Net occupancy 7,177 1.3% 6.0% Lower salaries and wages reflect the recent financial center closures and Equipment 6,765 12.0% (0.7%) the management of FTEs
Marketing 2,384 109.5% 42.3% . Anticipated gross cost savings of ~$6 million from closures remain on track
FDIC insurance 1,282 (39.3%) 0.3% to be fully realized during Q2 2021 Marketing expense was higher due to Amortization of intangible assets 2,896 (14.2%) (13.0%) increased product advertising and brand awareness campaigns that Other operating expenses 17,816 4.0% (0.9%) were delayed from 2020 due to the COVID-19 pandemic Sub-total non-interest expense $85,476 (0.8%) (2.4%) Q1 restructuring & merger-related Restructuring & merger-related 851 (83.5%) 75.8% charges related to the financial center optimization plan that was Total non-interest expense $86,327 (5.5%) (2.0%) completed during January 2021
19 Comparable Operating Metrics Disciplined execution upon growth strategies providing strong performance compared to all U.S. banks with total assets from $10B to 25B (note: 2020 comparability impacted by timing of the adoption of CECL accounting standard and economic assumptions used by each bank)
Return on Average Tangible Equity Return on Average Assets
1.74% 17.8% 18.4% 1.39% 1.34% 15.1% 1.09% 13.9% 1.34% 1.34% 1.35% 0.77% 14.9% 15.5% 14.6% 9.2% 1.04% 0.89% 11.5% 11.3%
12.2% 16.2% 14.0% 8.6% 18.2% 0.96% 1.26% 1.24% 0.73% 1.72%
2017 2018 2019 2020 2021 (3/31) 2017 2018 2019 2020 2021 (3/31) WSBC (x- merger & DTA revalue costs) WSBC $10-25B Banks WSBC (x- merger & DTA revalue costs) WSBC $10-25B Banks
Efficiency Ratio Net Interest Margin
3.86% 3.79% 3.71%
57.2% 3.35% 56.1% 3.15% 55.4% 55.2% 54.0%
56.4% 54.6% 56.7% 56.4% 56.7% 3.44% 3.52% 3.62% 3.37% 3.27%
2017 2018 2019 2020 2021 (3/31) 2017 2018 2019 2020 2021 (3/31) WSBC $10-25B Banks WSBC $10-25B Banks Note: financial data as of 12/31 YTD; current YTD data as of 3/31/2021; Current Expected Credit Losses (“CECL”) accounting standard adopted January 1, 2020 by WSBC; peer bank group includes all U.S. banks with total assets of $10B to $25B (as of each period) from S&P Global Market Intelligence (as of 5/3/2021) and represent simple averages (ROATE & ROAA are S&P calculations; Efficiency & NIM are company-reported); Efficiency & NIM presented on a fully taxable-equivalent (FTE) and annualized basis; please see 20 the reconciliations in the appendix Solid Legacy of Credit Quality Favorable asset quality measures compared to all U.S. banks with total assets from $10B to 25B (note: 2020 ACL comparability impacted by timing of the adoption of CECL accounting standard and economic assumptions used by each bank) Criticized & Classified Loans as % of Total Loans Non-Performing Assets as % of Total Assets
4.76% 0.89%
3.76% 0.71% 0.60% 0.60% 3.16% 2.98% 3.02% 0.57%
1.17% 1.08% 2.17% 4.59% 4.26% 0.50% 0.35% 0.35% 0.25% 0.23%
2017 2018 2019 2020 2021 (3/31) 2017 2018 2019 2020 2021 (3/31) WSBC $10-25B Banks WSBC $10-25B Banks
Net Charge-Offs as % of Average Loans (annualized) Allowance for Credit Losses as % of Total Loans
0.22% 0.22% 0.20% 0.20% 1.51% 1.49%
0.13% 0.95% 0.87% 0.80%
0.71% 0.64% 0.51% 1.72% 1.50% 0.13% 0.06% 0.09% 0.06% 0.02% 2017 2018 2019 2020 2021 (3/31) 2017 YTD 2018 YTD 2019 YTD 2020 YTD 2021 (3/31) WSBC $10-25B Banks WSBC $10-25B Banks
Note: financial data as of quarter ending 12/31; current year data as of 3/31/2021; Current Expected Credit Losses (“CECL”) accounting standard adopted January 1, 2020 by WSBC; 21 peer bank group includes all U.S. banks with total assets of $10B to $25B (as of each period) from S&P Global Market Intelligence (as of 5/3/2021) and represent simple averages Returning Value to Shareholders Focus on appropriate capital allocation to provide financial flexibility while continuing to enhance shareholder value through earnings growth and effective capital management
Capital management strategy: dividends, share repurchases, acquisitions . Q1 2021 dividend yield 3.5%, compared to 2.2% for bank group . On April 22, 2021, WesBanco’s Board of Directors authorized the adoption of a new stock repurchase program, which, when combined with the remainder of the previous authorization, represents ~5% of outstanding shares
Quarterly Dividend per Share ($) Tangible Book Value per Share ($) $0.33 $22.21 +136% +84%
$12.09 $0.14
4Q10 1Q21 4Q10 1Q21 Note: dividend through February 2021 declaration announcement; WSBC dividend payout ratio based on earnings per share excluding merger-related costs and including impact from adoption of the Current Expected Credit Losses (“CECL”) accounting standard; WSBC dividend yield based upon 5/3/2021 closing stock price of $37.28; peer bank group includes all 22 U.S. banks with total assets of $10B to $25B (as of most recent period) from S&P Global Market Intelligence (as of 5/3/2021) and represent simple averages Appendix Q1 2021 Key Metrics
Quarter Ending H / (L) H / (L)
03/31/21 03/31/20 12/31/20
Return on Average Assets (1)(2) 1.74% 104bp 52bp
PTPP Return on Average Assets (1)(2) 1.57% (1bp) 1bp
Return on Average Tangible Equity (1)(2) 18.39% 1,021bp 511bp
PTPP Return on Average Tangible Equity (1)(2) 16.78% (97bp) (22bp)
Tangible Book Value per Share ($) (1) $22.21 4.0% 2.1%
Efficiency Ratio (1)(2) 56.71% (98bp) (35bp)
Net Interest Margin 3.27% (27bp) (4bp)
Non-Performing Assets to Total Assets 0.23% (3bp) (2bp)
Net Loan Charge-offs to Average Loans (annualized) 0.02% (16bp) 0bp
Note: PTPP = pre-tax, pre-provision (1) Non-GAAP measure – please see reconciliation in appendix 24 (2) Excludes restructuring and merger-related expenses Q1 2021 Current Expected Credit Loss (CECL)
The decrease in the allowance was driven by improvement in the macroeconomic forecast and changes in portfolio mix slightly offset by COVID-19 pandemic related adjustments
Allowance coverage ratio of 1.50%, or, excluding SBA PPP loans, 1.62% . Excludes fair market value adjustments on previously acquired loans representing 0.34% of total portfolio loans
($000s)
Changes in Changes to Qualitative prepayment macroeconomic adjustments for speeds variables COVID-19 pandemic, regional Changes in Includes changes macroeconomic portfolio mix in both quantitative factors, and and qualitative hospitality industry Changes in economic factors classification loans credit quality Aging of existing portfolio Economic Pandemic Portfolio Factors Qualitative Factors Changes / Other Note: ACL at 3/31/2021 excludes off-balance sheet credit exposures of $6.7 million; on January 1, 2020, WSBC adopted the CECL accounting standard (prior to this date, the 25 allowance for credit losses was calculated under the incurred method) Reconciliation: Efficiency Ratio & Operating Leverage
Three Months Ending Twelve Months Ending
($000s) 03/31/20 12/31/20 03/31/21 12/31/10 12/31/11 12/31/12 12/31/13 12/31/14 12/31/15 12/31/16 12/31/17 12/31/18 12/31/19 12/31/20
Non-Interest Expense $91,333 $88,069 $86,327 $141,152 $140,295 $150,120 $160,998 $161,633 $193,923 $208,680 $220,860 $265,224 $312,208 $354,845
Restructuring & Merger-Related ($5,164) ($484) ($851) ($175) $0 ($3,888) ($1,310) ($1,309) ($11,082) ($13,261) ($945) ($17,860) ($16,397) ($9,725) Expense Non-Interest Expense (excluding restructuring & merger-related $86,169 $87,585 $85,476 $140,977 $140,295 $146,232 $159,688 $160,324 $182,841 $195,419 $219,915 $247,364 $295,811 $345,120 expense)
Net Interest Income (FTE-basis) $121,346 $120,790 $117,517 $172,235 $175,885 $175,027 $192,556 $200,545 $246,014 $263,232 $300,790 $352,760 $405,222 $483,999
Non-Interest Income $28,009 $32,705 $33,208 $59,599 $59,888 $64,775 $69,285 $68,504 $74,466 $81,499 $88,840 $100,276 $116,716 $128,185
Total Income $149,355 $153,495 $150,725 $231,834 $235,773 $239,802 $261,841 $269,049 $320,480 $344,731 $389,630 $453,036 $521,938 $612,184
Efficiency Ratio 57.69% 57.06% 56.71% 60.81% 59.50% 60.98% 60.99% 59.59% 57.05% 56.69% 56.44% 54.60% 56.68% 56.38%
Net Interest Income (before provision $120,162 $119,712 $116,478 $166,092 $169,365 $168,351 $185,487 $193,228 $236,987 $253,330 $290,295 $347,236 $399,904 $479,480 expense)(non-FTE)
Non-Interest Income $28,009 $32,705 $33,208 $59,599 $59,888 $64,775 $69,285 $68,504 $74,466 $81,499 $88,840 $100,276 $116,716 $128,185
Total Revenue $148,171 $152,417 $149,686 $225,691 $229,253 $233,126 $254,772 $261,732 $311,453 $334,829 $379,135 $447,512 $516,620 $607,665
YoY Change in Total Revenue $1,515 $2,730 $3,562 $3,873 $21,646 $6,960 $49,721 $23,376 $44,306 $68,377 $69,108 $91,045
YoY Change in Non-Interest Expense (excluding restructuring & merger- ($693) ($6,856) ($682) $5,937 $13,456 $636 $22,517 $12,578 $24,496 $27,449 $48,447 $49,309 related expense)
Operating Leverage 2.2x 9.6x 4.2x 0.7x 1.6x 10.9x 2.2x 1.9x 1.8x 2.5x 1.4x 1.8x
Note: “efficiency ratio” is non-interest expense excluding restructuring and merger-related expense divided by total income; FTE represents fully taxable equivalent; Old Line Bancshares merger closed November 2019; Farmers Capital Bank Corporation merger closed August 2018; First Sentry Bancshares merger closed April 2018; Your Community Bankshares merger26 closed September 2016; ESB Financial merger closed February 2015; Fidelity Bancorp merger closed November 2012; AmTrust 5 branch acquisition closed March 2009 Reconciliation: Pre-Tax, Pre-Provision Income (PTPP) and Ratios
Three Months Ending
($000s) 03/31/20 12/31/20 03/31/21
Income before Provision for Income Taxes $27,017 $64,557 $91,317
Provision for Credit Losses 29,821 (209) (27,958)
Pre-Tax, Pre-Provision Income ("PTPP") $56,838 $64,348 $63,359
Restructuring and Merger-Related Expense 5,164 484 851
PTPP (excluding restructuring and merger-related expense) $62,002 $64,832 $64,210
PTPP (excluding restructuring and merger-related expense) $62,002 $64,832 $64,210
Average Total Assets 15,784,939 16,546,761 16,636,258
PTPP Return on Average Assets 1.58% 1.56% 1.57%
PTPP (excluding restructuring and merger-related expense) $62,002 $64,832 $64,210
Amortization of Intangibles 3,374 3,327 2,896
PTPP before Amortization of Intangibles (excluding restructuring and merger-related expense) $65,376 $68,159 $67,106
Average Total Shareholders' Equity $2,594,069 $2,744,936 $2,770,416
Average Goodwill and Other Intangibles (net of deferred tax liability) (1,112,327) (1,150,184) (1,148,171)
Average Tangible Equity $1,481,742 $1,594,752 $1,622,245
PTPP Return on Average Tangible Equity 17.75% 17.00% 16.78%
27 Note: Old Line Bancshares merger closed November 2019 Reconciliation: Net Income, EPS & Tangible Book Value per Share
Three Months Ending
($000s, except earnings per share) 12/31/10 03/31/20 12/31/20 03/31/21
Net Income Available to Common Shareholders n/a $23,396 $50,210 $70,584
Restructuring and Merger-Related Expense (net of tax) n/a 4,080 383 672
Net Income Available to Common Shareholders (excluding restructuring n/a $27,476 $50,593 $71,256 and merger-related expense)
Net Income Available to Common Shareholders per Diluted Share ($) n/a $0.35 $0.75 $1.05
Restructuring and Merger-Related Expense (net of tax) n/a 0.06 0.01 0.01
Net Income Available to Common Shareholders per Diluted Share ($) n/a $0.41 $0.76 $1.06 (excluding restructuring and merger-related expense)
Average Common Shares Outstanding – Diluted (000s) n/a 67,587 67,304 67,335
Total Shareholders's Equity (period-end) $606,863 $2,586,060 $2,756,737 $2,785,522
Goodwill & Other Intangible Assets (net of deferred tax liability)(period-end) (285,559) (1,154,033) (1,149,161) (1,146,874)
Preferred Shareholders' Equity 0 0 (144,484) (144,484)
Tangible Common Equity (period-end) $321,304 $1,432,027 $1,463,092 $1,494,164
Common Shares Outstanding (period-end) (000s) 26,587 67,058 67,255 67,282
Tangible Common Book Value per Share ($) $12.09 $21.36 $21.75 $22.21
28 Note: Current Expected Credit Losses (“CECL”) accounting standard adopted January 1, 2020 by WSBC; Old Line Bancshares merger closed November 2019 Reconciliation: Return on Average Assets
Three Months Ending Twelve Months Ending
($000s) 03/31/20 03/31/21 12/31/17 12/31/18 12/31/19 12/31/20
Net Income Available to Common Shareholders $23,396 $70,584 $94,482 $143,112 $158,873 $119,400
Restructuring and Merger-Related Expenses (net of tax) $4,080 $672 $614 $14,109 $12,954 $7,683
Net Income Available to Common Shareholders (excluding restructuring $27,476 $71,256 $107,876 $157,221 $171,827 $127,083 & merger-related expense)
Average Assets $15,784,939 $16,636,258 $9,854,312 $11,337,379 $12,853,920 $16,442,704
Return on Average Assets 0.60% 1.72% 0.96% 1.26% 1.24% 0.73%
Return on Average Assets (excluding restructuring & merger-related 0.70% 1.74% 1.09% 1.39% 1.34% 0.77% expense)
Note: Current Expected Credit Losses (“CECL”) accounting standard adopted January 1, 2020 by WSBC; Old Line Bancshares merger closed November 2019; Farmers Capital 29 Bank Corporation merger closed August 2018; First Sentry Bancshares merger closed April 2018; Your Community Bankshares merger closed September 2016 Reconciliation: Return on Average Tangible Equity
Three Months Ending Twelve Months Ending
($000s) 03/31/20 03/31/21 12/31/17 12/31/18 12/31/19 12/31/20
Net Income Available to Common Shareholders $23,396 $70,584 $94,482 $143,112 $158,873 $119,400
Amortization of Intangibles (1) $2,665 $2,288 $3,211 $5,514 $8,169 $10,595
Net Income Available to Common Shareholders before Amortization $26,061 $72,872 $97,693 $148,626 $167,042 $129,995 of Intangibles
Restructuring and Merger-Related Expenses (net of tax) $4,080 $672 $614 $14,109 $12,954 $7,683
Net Income Available to Common Shareholders before Amortization $30,141 $73,544 $111,087 $162,735 $179,996 $137,678 of Intangibles and Restructuring & Merger-Related Expenses
Average Total Shareholders Equity $2,594,069 $2,770,416 $1,383,935 $1,648,425 $2,119,995 $2,651,402
Average Goodwill & Other Intangibles, Net of Deferred Tax Liabilities ($1,112,327) ($1,148,171) ($584,885) ($732,978) ($927,974) ($1,141,528)
Average Tangible Equity $1,481,742 $1,622,245 $799,050 $915,447 $1,192,021 $1,509,874
Return on Average Tangible Equity 7.07% 18.22% 12.23% 16.24% 14.01% 8.61%
Return on Average Tangible Equity Excluding Restructuring & Merger- 8.18% 18.39% 13.90% 17.78% 15.10% 9.12% Related Expenses
(1) amortization of intangibles tax effected at 21% for 2018 forward, and 35% for all prior periods Note: Current Expected Credit Losses (“CECL”) accounting standard adopted January 1, 2020 by WSBC; Old Line Bancshares merger closed November 2019; Farmers Capital 30 Bank Corporation merger closed August 2018; First Sentry Bancshares merger closed April 2018; Your Community Bankshares merger closed September 2016