Bay Street News

Sandy Spring Bancorp Reports Third Quarter Earnings of $16.2 Million

OLNEY, Md., Oct. 21, 2024 (GLOBE NEWSWIRE) — Sandy Spring Bancorp, Inc. (Nasdaq-SASR), the parent company of Sandy Spring Bank, reported net income of $16.2 million ($0.36 per diluted common share) for the quarter ended September 30, 2024, compared to net income of $22.8 million ($0.51 per diluted common share) for the second quarter of 2024 and $20.7 million ($0.46 per diluted common share) for the third quarter of 2023.

Current quarter’s core earnings were $17.9 million ($0.40 per diluted common share), compared to $24.4 million ($0.54 per diluted common share) for the quarter ended June 30, 2024 and $27.8 million ($0.62 per diluted common share) for the quarter ended September 30, 2023. Core earnings exclude the after-tax impact of amortization of intangibles, investment securities gains or losses and other non-recurring or extraordinary items. The current quarter’s decline in net income and core earnings as compared to the linked quarter was driven by higher provision for credit losses combined with higher non-interest expense, partially offset by higher net interest income. The total provision for credit losses was $6.3 million for the third quarter of 2024 compared to $1.0 million for the previous quarter and $2.4 million for the third quarter of 2023.

“We have a solid capital position and are seeing ongoing success with our core deposit strategies and our wealth management lines of business,” said Daniel J. Schrider, Chair, President & CEO of Sandy Spring Bank. “Our wealth teams – Sandy Spring Trust, and our subsidiaries, West Financial and RPJ – have an expanding number of referrals from current clients and work closely with business owners from early growth through maturity. The success of our wealth teams’ approach is reflected in our strong fee income results.”

Third Quarter Highlights

Balance Sheet and Credit Quality

Total assets were $14.4 billion at September 30, 2024, as compared to $14.0 billion at June 30, 2024. At September 30, 2024, total loans remained stable at $11.5 billion compared to the previous quarter. During this period, the growth in AD&C and commercial business loans and lines of $71.3 million or 6% and $19.4 million or 1%, respectively, were mostly offset by the decline in commercial investor real estate loans of $64.9 million or 1%. Total residential mortgage and consumer loan portfolios remained relatively unchanged.

Deposits increased $397.5 million or 4% to $11.7 billion at September 30, 2024 compared to $11.3 billion at June 30, 2024. During this period, noninterest-bearing deposits decreased $28.3 million or 1%, while interest-bearing deposits increased $425.8 million or 5%. The slight decline in noninterest-bearing deposit categories was driven by decreases in personal and small business checking accounts, partially offset by an increase in commercial checking accounts. Growth in interest-bearing deposits was seen across all product categories, but most notably in money market and time deposit accounts which grew $185.2 million or 7% and $151.5 million or 6% during the current quarter, respectively. Total deposits, excluding brokered deposits, increased by $351.7 million or 3% quarter-over-quarter and remained at 94% of the total deposits as of September 30, 2024 compared to June 30, 2024, reflecting continued strength and stability of the core deposit base. Total uninsured deposits at September 30, 2024 were approximately 37% of total deposits.

Total borrowings decreased $54.1 million or 6% at September 30, 2024 as compared to the previous quarter, primarily driven by a $50.0 million pay down of FHLB advances. At September 30, 2024, available unused sources of liquidity, which consist of available FHLB borrowings, fed funds, funds through the Federal Reserve Bank’s discount window, as well as excess cash and unpledged investment securities, totaled $6.3 billion or 146% of uninsured deposits.

The tangible common equity to tangible assets ratio declined slightly to 8.83% at September 30, 2024, compared to 8.85% at June 30, 2024.

At September 30, 2024, the Company had a total risk-based capital ratio of 15.53%, a common equity tier 1 risk-based capital ratio of 11.27%, a tier 1 risk-based capital ratio of 11.27%, and a tier 1 leverage ratio of 9.59%. These risk-based capital ratios compare to a total risk-based capital ratio of 15.49%, a common equity tier 1 risk-based capital ratio of 11.28%, a tier 1 risk-based capital ratio of 11.28%, and a tier 1 leverage ratio of 9.70% at June 30, 2024. All of these ratios remain well in excess of the mandated minimum regulatory requirements.

Non-performing loans include non-accrual loans and accruing loans 90 days or more past due. At September 30, 2024, non-performing loans totaled $125.3 million, compared to $93.0 million at June 30, 2024 and $51.8 million at September 30, 2023. The non-performing loans to total loans ratio was 1.09% compared to 0.81% on a linked quarter basis. These levels of non-performing loans compare to 0.46% at September 30, 2023. The current quarter’s increase in non-performing loans was mainly related to a single AD&C loan with the total outstanding principal balance of $28.0 million, which was placed on a non-accrual status during the current period. Total net charge-offs for the current quarter amounted to $0.7 million compared to $0.2 million for the second quarter of 2024 and $0.1 million for the third quarter of 2023.

At September 30, 2024, the allowance for credit losses was $131.4 million or 1.14% of outstanding loans and 105% of non-performing loans, compared to $125.9 million or 1.10% of outstanding loans and 135% of non-performing loans at the end of the previous quarter and $123.4 million or 1.09% of outstanding loans and 238% of non-performing loans at the end of the third quarter of 2023. The increase in the allowance for the current quarter compared to the previous quarter mainly reflects higher individual reserves on collateral-dependent non-accrual loans, primarily driven by the aforementioned AD&C lending relationship, partially offset by lower qualitative adjustments as a result of declines in commercial investor real estate loans.

Income Statement Review

Quarterly Results

Net income was $16.2 million ($0.36 per diluted common share) for the three months ended September 30, 2024 compared to $22.8 million ($0.51 per diluted common share) for the three months ended June 30, 2024 and $20.7 million ($0.46 per diluted common share) for the prior year quarter. The current quarter’s core earnings were $17.9 million ($0.40 per diluted common share), compared to $24.4 million ($0.54 per diluted common share) for the previous quarter and $27.8 million ($0.62 per diluted common share) for the quarter ended September 30, 2023. The decreases in the current quarter’s net income and core earnings compared to the previous quarter were driven primarily by higher provision for credit losses and non-interest expense.

Net interest income for the third quarter of 2024 increased $1.1 million or 1% compared to the previous quarter and declined $3.7 million or 4% compared to the third quarter of 2023. During the current quarter, interest income increased $5.0 million, while interest expense increased $3.9 million. The rising interest rate environment was primarily responsible for a $7.7 million year-over-year increase in interest income. This growth in interest income was more than offset by the $11.4 million year-over-year growth in interest expense as funding costs have also risen in response to the rising rate environment and significant competition for deposits.

The net interest margin was 2.44% for the third quarter of 2024 compared to 2.46% for the second quarter of 2024 and 2.55% for the third quarter of 2023. The decrease in the net interest margin during the current quarter was a result of a seven basis point increase in the rate paid on interest-bearing liabilities, while the yield earned on interest-earning assets rose three basis points. The current quarter’s net interest margin was negatively impacted by approximately three basis points due to the reversal of previously accrued uncollected interest income on a single large AD&C loan placed on non-accrual status during the period. As compared to the prior year quarter, the yield on interest-earning assets increased 23 basis points while the rate paid on interest-bearing liabilities rose 39 basis points, resulting in net interest margin compression of 11 basis points. The rate and yield increases year-over-year were driven by the higher interest rate environment, competition for deposits in the market, and customer movement of excess funds out of noninterest-bearing accounts into higher yielding products.

The total provision for credit losses was $6.3 million for the third quarter of 2024 compared to $1.0 million for the previous quarter and $2.4 million for the third quarter of 2023. The provision for credit losses directly attributable to the funded loan portfolio was $6.3 million for the current quarter compared to $3.0 million for the second quarter of 2024 and $3.2 million for the third quarter of 2023. The current quarter’s provision is mainly a reflection of higher individual reserves on collateral-dependent non-accrual loans, primarily associated with the provision on a single AD&C lending relationship based on the current fair value of the collateral, partially offset by lower qualitative adjustments driven by an overall reduction in commercial investor real estate loan portfolio. In addition, during the current quarter, the reserve for unfunded commitments remained relatively stable at $1.5 million.

Non-interest income for the third quarter of 2024 increased by 1% or $0.1 million compared to the linked quarter and grew by 13% or $2.3 million compared to the prior year quarter. The current quarter’s increase in non-interest income as compared to the previous quarter was mainly driven by the $0.4 million increase in other income, generated by credit-related fees, and $0.3 million increase in wealth management income, due to the $352.1 million or 6% growth in assets under management quarter-over-quarter and the overall favorable market performance, offset by $0.5 million decrease in BOLI income, due to the receipt of one-time death proceeds in the prior quarter.

Non-interest expense for the third quarter of 2024 increased $4.8 million or 7% compared to the second quarter of 2024 and $0.5 million or 1% compared to the third quarter of 2023. The quarter-over-quarter increase is predominantly attributable to the $3.2 million increase in salaries and benefits, due to the increase in employee incentive compensation coupled with the $1.6 million increase in professional fees and services, mostly due to a one-time contract negotiation fee. The prior year quarter included $8.2 million of pension settlement expense related to the termination of the Company’s pension plan. Excluding this item, non-interest expense for the third quarter of 2024 increased $8.6 million or 13% compared to the third quarter of 2023.

For the third quarter of 2024, the GAAP efficiency ratio was 72.12% compared to 68.19% for the second quarter of 2024 and 70.72% for the third quarter of 2023. The GAAP efficiency ratio rose from the prior year quarter primarily as a result of the 1% increase in GAAP non-interest expense coupled with the 1% decline in GAAP revenue. The non-GAAP efficiency ratio was 69.06% for the current quarter as compared to 65.31% for the second quarter of 2024 and 60.91% for the third quarter of 2023. The increase in the non-GAAP efficiency ratio (reflecting a decrease in efficiency) from the third quarter of the prior year to the current year quarter was primarily the result of the 12% increase in adjusted non-interest expense.

ROA for the quarter ended September 30, 2024 was 0.46% and ROTCE was 5.88% compared to 0.66% and 8.27%, respectively, for the second quarter of 2024 and 0.58% and 7.42%, respectively, for the third quarter of 2023. On a non-GAAP basis, the current quarter’s core ROA was 0.50% and core ROTCE was 5.88% compared to 0.70% and 8.27% for the second quarter of 2024 and 0.78% and 9.51%, respectively, for the third quarter of 2023.

Year-to-Date Results

The Company recorded net income of $59.4 million for the nine months ended September 30, 2024 compared to net income of $96.7 million for the same period in the prior year. Core earnings were $64.3 million for the nine months ended September 30, 2024 compared to $107.2 million for the same period in the prior year. Year-to-date net income and core earnings declined as a result of lower net interest income in combination with higher provision for credit losses, which was partially offset by higher non-interest income.

For the nine months ended September 30, 2024, net interest income decreased $31.8 million compared to the prior year as a result of the $61.1 million increase in interest expense, partially offset by the $29.3 million increase in interest income. The increase in interest expense was driven by the interest expense on deposits, primarily associated with savings and time deposit accounts. The net interest margin declined to 2.44% for the nine months ended September 30, 2024, compared to 2.75% for the prior year, primarily as a result of higher funding costs due to the elevated interest rate environment and market competition for deposits during the period.

The provision for credit losses for the nine months ended September 30, 2024 was $9.7 million as compared to a credit of $14.1 million for 2023. The provision for the nine months ended September 30, 2024 was primarily due to an increase in individual reserves on collateral-dependent non-accrual loans, as well as adjustments applied to specific industries within the commercial real estate segment during the first quarter of 2024. The prior year’s credit to provision was mainly attributable to the improving regional forecasted unemployment rate observed during the first half of 2023, and the declining probability of economic recession.

For the nine months ended September 30, 2024, non-interest income increased 14% to $57.7 million compared to $50.5 million for 2023. During the current year, wealth management income increased $3.7 million or 14%, as assets under management increased $1.0 billion or 19% year-over-year. In addition, BOLI mortality-related income and service charges on deposit accounts increased $1.3 million and $1.1 million, respectively.

Non-interest expense increased to $209.0 million for the nine months ended September 30, 2024, compared to $207.9 million for 2023. The drivers of the increase in non-interest expense were the $4.0 million increase in professional fees and services, $2.7 increase in amortization of intangible assets, $1.8 million increase in FDIC expense, and $1.2 million increase in outside data services. These year-over-year increases were offset by the $9.2 million decrease in compensation and benefits, as the prior year period included $8.2 million pension termination expense and $1.9 million of severance related expenses associated with staffing adjustments.

For the nine months ended September 30, 2024, the GAAP efficiency ratio was 69.98% compared to 64.29% for the same period in 2023. The non-GAAP efficiency ratio for the current year was 67.04% compared to 59.42% for the prior year. The growth in the current year’s GAAP and non-GAAP efficiency ratios compared to the prior year, indicating a decline in efficiency, was the result of the declines in GAAP and non-GAAP revenues combined with the growth in GAAP and non-GAAP non-interest expenses.

Explanation of Non-GAAP Financial Measures

This news release contains financial information and performance measures determined by methods other than in accordance with generally accepted accounting principles in the United States (“GAAP”). The Company’s management believes that the supplemental non-GAAP information provides a better comparison of period-to-period operating performance. Additionally, the Company believes this information is utilized by regulators and market analysts to evaluate a company’s financial condition and, therefore, such information is useful to investors. Non-GAAP measures used in this release consist of the following:

These disclosures should not be viewed as a substitute for financial results in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Please refer to the non-GAAP Reconciliation tables included with this release for a reconciliation of these non-GAAP measures to the most directly comparable GAAP measure.

Conference Call Cancelled

As a result of today’s announcement that the Company has entered into a merger agreement with Atlantic Union Bankshares Corporation, the Company has cancelled its conference call scheduled for 2:00 p.m. ET today to discuss the Company’s results for the third quarter of 2024.

About Sandy Spring Bancorp, Inc.

Sandy Spring Bancorp, Inc., headquartered in Olney, Maryland, is the holding company for Sandy Spring Bank, a premier community bank in the Greater Washington, D.C. region. With over 50 locations, the bank offers a broad range of commercial and retail banking, mortgage, private banking, and trust services throughout Maryland, Virginia, and Washington, D.C. Through its subsidiaries, Rembert Pendleton Jackson and West Financial Services, Inc., Sandy Spring Bank also offers a comprehensive menu of wealth management services.

Source: Sandy Spring Bancorp, Inc.
Code: SASR-E

Forward-Looking Statements

Sandy Spring Bancorp’s forward-looking statements are subject to significant risks and uncertainties that may cause actual results to differ materially from those in such statements. These risks and uncertainties include, but are not limited to, the risks identified in our quarterly and annual reports and the following: changes in general business and economic conditions nationally or in the markets that we serve; changes in consumer and business confidence, investor sentiment, or consumer spending or savings behavior; changes in the level of inflation; changes in the demand for loans, deposits and other financial services that we provide; the possibility that future credit losses may be higher than currently expected; the impact of the interest rate environment on our business, financial condition and results of operations; the impact of compliance with changes in laws, regulations and regulatory interpretations, including changes in income taxes; changes in credit ratings assigned to us or our subsidiaries; the ability to realize benefits and cost savings from, and limit any unexpected liabilities associated with, any business combinations; competitive pressures among financial services companies; the ability to attract, develop and retain qualified employees; our ability to maintain the security of our data processing and information technology systems; the impact of changes in accounting policies, including the introduction of new accounting standards; the impact of judicial or regulatory proceedings; the impact of fiscal and governmental policies of the United States federal government; the impact of health emergencies, epidemics or pandemics; the effects of climate change; and the impact of natural disasters, extreme weather events, military conflict, terrorism or other geopolitical events. Sandy Spring Bancorp provides greater detail regarding some of these factors in its Form 10-K for the year ended December 31, 2023, including in the Risk Factors section of that report, and in its other SEC reports. Sandy Spring Bancorp’s forward-looking statements may also be subject to other risks and uncertainties, including those that it may discuss elsewhere in this news release or in its filings with the SEC, accessible on the SEC’s Web site at www.sec.gov.

Sandy Spring Bancorp, Inc. and Subsidiaries
FINANCIAL HIGHLIGHTS – UNAUDITED

    Three Months Ended
September 30,
      Nine Months Ended
September 30,
   
(Dollars in thousands, except per share data)     2024       2023     %
Change
    2024       2023     %
Change
Results of operations:                        
Net interest income   $ 81,412     $ 85,081     (4 )%   $ 241,040     $ 272,854     (12 )%
Provision/ (credit) for credit losses     6,316       2,365     167 %     9,724       (14,116 )   N/M
Non-interest income     19,715       17,391     13       57,669       50,518     14  
Non-interest expense     72,937       72,471     1       209,047       207,912     1  
Income before income tax expense     21,874       27,636     (21 )     79,938       129,576     (38 )
Net income     16,209       20,746     (22 )     59,388       96,744     (39 )
                         
Net income attributable to common shareholders   $ 16,205     $ 20,719     (22 )   $ 59,351     $ 96,552     (39 )
Pre-tax pre-provision net income (1)   $ 28,190     $ 30,001     (6 )   $ 89,662     $ 115,460     (22 )
                         
Return on average assets     0.46 %     0.58 %         0.56 %     0.92 %    
Return on average common equity     4.01 %     5.35 %         4.99 %     8.50 %    
Return on average tangible common equity (1)     5.88 %     7.42 %         7.17 %     11.67 %    
Net interest margin     2.44 %     2.55 %         2.44 %     2.75 %    
Efficiency ratio – GAAP basis (2)     72.12 %     70.72 %         69.98 %     64.29 %    
Efficiency ratio – Non-GAAP basis (2)     69.06 %     60.91 %         67.04 %     59.42 %    
                         
Per share data:                        
Basic net income per common share   $ 0.36     $ 0.46     (22 )%   $ 1.32     $ 2.16     (39 )%
Diluted net income per common share   $ 0.36     $ 0.46     (22 )   $ 1.31     $ 2.15     (39 )
Weighted average diluted common shares     45,242,920       44,960,455     1       45,156,521       44,912,803     1  
Dividends declared per share   $ 0.34     $ 0.34         $ 1.02     $ 1.02      
Book value per common share   $ 36.10     $ 34.26     5     $ 36.10     $ 34.26     5  
Tangible book value per common share (1)   $ 27.37     $ 25.80     6     $ 27.37     $ 25.80     6  
Outstanding common shares     45,125,078       44,895,158     1       45,125,078       44,895,158     1  
                         
Financial condition at period-end:                        
Investment securities   $ 1,440,488     $ 1,392,078     3 %   $ 1,440,488     $ 1,392,078     3 %
Loans     11,491,921       11,300,292     2       11,491,921       11,300,292     2  
Assets     14,383,073       14,135,085     2       14,383,073       14,135,085     2  
Deposits     11,737,694       11,151,012     5       11,737,694       11,151,012     5  
Stockholders’ equity     1,628,837       1,537,914     6       1,628,837       1,537,914     6  
                         
Capital ratios:                        
Tier 1 leverage (3)     9.59 %     9.50 %         9.59 %     9.50 %    
Common equity tier 1 capital to risk-weighted assets (3)     11.27 %     10.83 %         11.27 %     10.83 %    
Tier 1 capital to risk-weighted assets (3)     11.27 %     10.83 %         11.27 %     10.83 %    
Total regulatory capital to risk-weighted assets (3)     15.53 %     14.85 %         15.53 %     14.85 %    
Tangible common equity to tangible assets (4)     8.83 %     8.42 %         8.83 %     8.42 %    
Average equity to average assets     11.37 %     10.92 %         11.32 %     10.84 %    
                         
Credit quality ratios:                        
Allowance for credit losses to loans     1.14 %     1.09 %         1.14 %     1.09 %    
Non-performing loans to total loans     1.09 %     0.46 %         1.09 %     0.46 %    
Non-performing assets to total assets     0.89 %     0.37 %         0.89 %     0.37 %    
Allowance for credit losses to non-performing loans     104.92 %     238.32 %         104.92 %     238.32 %    
Annualized net charge-offs/ (recoveries) to average loans (5)     0.03 %     %         0.02 %     0.02 %    
N/M – not meaningful
(1) Represents a non-GAAP measure.
(2) The efficiency ratio – GAAP basis is non-interest expense divided by net interest income plus non-interest income from the Condensed Consolidated Statements of Income. The traditional efficiency ratio – Non-GAAP basis excludes intangible asset amortization, pension settlement expense, severance expense and contingent payment expense from non-interest expense; and investment securities gains/ (losses) from non-interest income; and adds the tax-equivalent adjustment to net interest income. See the Reconciliation Table included with these Financial Highlights.
(3) Estimated ratio at September 30, 2024.
(4) The tangible common equity to tangible assets ratio is a non-GAAP ratio that divides assets excluding goodwill and other intangible assets into stockholders’ equity after deducting goodwill and other intangible assets. See the Reconciliation Table included with these Financial Highlights.
(5) Calculation utilizes average loans, excluding residential mortgage loans held-for-sale.

Sandy Spring Bancorp, Inc. and Subsidiaries
RECONCILIATION TABLE – UNAUDITED (CONTINUED)
OPERATING EARNINGS – METRICS

    Three Months Ended
September 30,
  Nine Months Ended
September 30,
(Dollars in thousands)     2024       2023       2024       2023  
Core earnings (non-GAAP):                
Net income (GAAP)   $ 16,209     $ 20,746     $ 59,388     $ 96,744  
Plus/ (less) non-GAAP adjustments (net of tax)(1):                
Amortization of intangible assets     1,727       932       4,864       2,851  
Severance expense                       1,445  
Pension settlement expense           6,088             6,088  
Contingent payment expense                       27  
Core earnings (Non-GAAP)   $ 17,936     $ 27,766     $ 64,252     $ 107,155  
                 
Core earnings per diluted common share (non-GAAP):                
Weighted average common shares outstanding – diluted (GAAP)     45,242,920       44,960,455       45,156,521       44,912,803  
                 
Earnings per diluted common share (GAAP)   $ 0.36     $ 0.46     $ 1.31     $ 2.15  
Core earnings per diluted common share (non-GAAP)   $ 0.40     $ 0.62     $ 1.42     $ 2.39  
                 
Core return on average assets (non-GAAP):                
Average assets (GAAP)   $ 14,136,037     $ 14,086,342     $ 14,051,722     $ 14,043,925  
                 
Return on average assets (GAAP)     0.46 %     0.58 %     0.56 %     0.92 %
Core return on average assets (non-GAAP)     0.50 %     0.78 %     0.61 %     1.02 %
                 
Return/ Core return on average tangible common equity (non-GAAP):                
Net Income (GAAP)   $ 16,209     $ 20,746     $ 59,388     $ 96,744  
Plus: Amortization of intangible assets (net of tax)     1,727       932       4,864       2,851  
Net income before amortization of intangible assets   $ 17,936     $ 21,678     $ 64,252     $ 99,595  
                 
Average total stockholders’ equity (GAAP)   $ 1,607,377     $ 1,538,553     $ 1,590,682     $ 1,522,153  
Average goodwill     (363,436 )     (363,436 )     (363,436 )     (363,436 )
Average other intangible assets, net     (30,679 )     (16,777 )     (29,940 )     (18,068 )
Average tangible common equity (non-GAAP)   $ 1,213,262     $ 1,158,340     $ 1,197,306     $ 1,140,649  
                 
Return on average tangible common equity (non-GAAP)     5.88 %     7.42 %     7.17 %     11.67 %
Core return on average tangible common equity (non-GAAP)     5.88 %     9.51 %     7.17 %     12.56 %
(1) Tax adjustments have been determined using the combined marginal federal and state rate of 25.48% and 25.37% for 2024 and 2023, respectively.

Sandy Spring Bancorp, Inc. and Subsidiaries
RECONCILIATION TABLE – UNAUDITED

    Three Months Ended
September 30,
  Nine Months Ended
September 30,
(Dollars in thousands)     2024       2023       2024       2023  
Pre-tax pre-provision net income:                
Net income (GAAP)   $ 16,209     $ 20,746     $ 59,388     $ 96,744  
Plus/ (less) non-GAAP adjustments:                
Income tax expense     5,665       6,890       20,550       32,832  
Provision/ (credit) for credit losses     6,316       2,365       9,724       (14,116 )
Pre-tax pre-provision net income (non-GAAP)   $ 28,190     $ 30,001     $ 89,662     $ 115,460  
                 
Efficiency ratio (GAAP):                
Non-interest expense   $ 72,937     $ 72,471     $ 209,047     $ 207,912  
                 
Net interest income plus non-interest income   $ 101,127     $ 102,472     $ 298,709     $ 323,372  
                 
Efficiency ratio (GAAP)     72.12 %     70.72 %     69.98 %     64.29 %
                 
Efficiency ratio (Non-GAAP):                
Non-interest expense   $ 72,937     $ 72,471     $ 209,047     $ 207,912  
Less non-GAAP adjustments:                
Amortization of intangible assets     2,323       1,245       6,527       3,820  
Severance expense                       1,939  
Pension settlement expense           8,157             8,157  
Contingent payment expense                       36  
Non-interest expense – as adjusted   $ 70,614     $ 63,069     $ 202,520     $ 193,960  
                 
Net interest income plus non-interest income   $ 101,127     $ 102,472     $ 298,709     $ 323,372  
Plus non-GAAP adjustment:                
Tax-equivalent income     1,121       1,068       3,359       3,044  
Less/ (plus) non-GAAP adjustment:                
Investment securities gains/ (losses)                        
Net interest income plus non-interest income – as adjusted   $ 102,248     $ 103,540     $ 302,068     $ 326,416  
                 
Efficiency ratio (Non-GAAP)     69.06 %     60.91 %     67.04 %     59.42 %
                 
Tangible common equity ratio:                
Total stockholders’ equity   $ 1,628,837     $ 1,537,914     $ 1,628,837     $ 1,537,914  
Goodwill     (363,436 )     (363,436 )     (363,436 )     (363,436 )
Other intangible assets, net     (30,514 )     (16,035 )     (30,514 )     (16,035 )
Tangible common equity   $ 1,234,887     $ 1,158,443     $ 1,234,887     $ 1,158,443  
                 
Total assets   $ 14,383,073     $ 14,135,085     $ 14,383,073     $ 14,135,085  
Goodwill     (363,436 )     (363,436 )     (363,436 )     (363,436 )
Other intangible assets, net     (30,514 )     (16,035 )     (30,514 )     (16,035 )
Tangible assets   $ 13,989,123     $ 13,755,614     $ 13,989,123     $ 13,755,614  
                 
Tangible common equity ratio     8.83 %     8.42 %     8.83 %     8.42 %
                 
Outstanding common shares     45,125,078       44,895,158       45,125,078       44,895,158  
Tangible book value per common share   $ 27.37     $ 25.80     $ 27.37     $ 25.80  

Sandy Spring Bancorp, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF CONDITION – UNAUDITED

(Dollars in thousands)   September 30,
2024
  December 31,
2023
Assets        
Cash and due from banks   $ 109,583     $ 82,257  
Federal funds sold           245  
Interest-bearing deposits with banks     640,763       463,396  
Cash and cash equivalents     750,346       545,898  
Residential mortgage loans held for sale (at fair value)     21,489       10,836  
SBA loans held for sale     425        
Investments held-to-maturity (fair values of $189,853 and $200,411 at September 30, 2024 and December 31, 2023, respectively)     220,296       236,165  
Investments available-for-sale (at fair value)     1,149,056       1,102,681  
Other investments, at cost     71,136       75,607  
Total loans     11,491,921       11,366,989  
Less: allowance for credit losses – loans     (131,428 )     (120,865 )
Net loans     11,360,493       11,246,124  
Premises and equipment, net     57,249       59,490  
Other real estate owned     3,265        
Accrued interest receivable     45,162       46,583  
Goodwill     363,436       363,436  
Other intangible assets, net     30,514       28,301  
Other assets     310,206       313,051  
Total assets   $ 14,383,073     $ 14,028,172  
         
Liabilities        
Noninterest-bearing deposits   $ 2,903,063     $ 2,914,161  
Interest-bearing deposits     8,834,631       8,082,377  
Total deposits     11,737,694       10,996,538  
Securities sold under retail repurchase agreements     70,767       75,032  
Federal Reserve Bank borrowings           300,000  
Advances from FHLB     450,000       550,000  
Subordinated debt     371,251       370,803  
Total borrowings     892,018       1,295,835  
Accrued interest payable and other liabilities     124,524       147,657  
Total liabilities     12,754,236       12,440,030  
         
Stockholders’ equity        
Common stock — par value $1.00; shares authorized 100,000,000; shares issued and outstanding 45,125,078 and 44,913,561 at September 30, 2024 and December 31, 2023, respectively.     45,125       44,914  
Additional paid in capital     748,202       742,243  
Retained earnings     911,411       898,316  
Accumulated other comprehensive loss     (75,901 )     (97,331 )
Total stockholders’ equity     1,628,837       1,588,142  
Total liabilities and stockholders’ equity   $ 14,383,073     $ 14,028,172  

Sandy Spring Bancorp, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF INCOME – UNAUDITED

    Three Months Ended
September 30,
  Nine Months Ended
September 30,
(Dollars in thousands, except per share data)     2024     2023     2024     2023  
Interest income:                
Interest and fees on loans   $ 154,339   $ 147,304   $ 456,309   $ 431,305  
Interest on mortgage loans held for sale     364     238     801     697  
Interest on SBA loans held for sale     2         2      
Interest on deposits with banks     6,191     6,371     17,401     13,979  
Interest and dividend income on investment securities:                
Taxable     7,440     6,682     21,319     20,538  
Tax-advantaged     1,762     1,811     5,385     5,376  
Interest on federal funds sold         5     8     13  
Total interest income     170,098     162,411     501,225     471,908  
Interest expense:                
Interest on deposits     79,287     63,102     227,062     155,215  
Interest on retail repurchase agreements and federal funds purchased     452     4,082     4,890     10,377  
Interest on advances from FHLB     5,001     6,200     16,394     21,623  
Interest on subordinated debt     3,946     3,946     11,839     11,839  
Total interest expense     88,686     77,330     260,185     199,054  
Net interest income     81,412     85,081     241,040     272,854  
Provision/ (credit) for credit losses     6,316     2,365     9,724     (14,116 )
Net interest income after provision/ (credit) for credit losses     75,096     82,716     231,316     286,970  
Non-interest income:                
Service charges on deposit accounts     3,009     2,704     8,765     7,698  
Mortgage banking activities     1,529     1,682     4,524     4,744  
Wealth management income     10,738     9,391     31,151     27,414  
Income from bank owned life insurance     1,307     845     4,283     3,003  
Bank card fees     435     450     1,293     1,315  
Other income     2,697     2,319     7,653     6,344  
Total non-interest income     19,715     17,391     57,669     50,518  
Non-interest expense:                
Salaries and employee benefits     41,030     44,853     115,549     124,710  
Occupancy expense of premises     4,657     4,609     14,278     14,220  
Equipment expenses     3,841     3,811     11,672     11,688  
Marketing     1,320     729     3,350     3,861  
Outside data services     3,025     2,819     9,414     8,186  
FDIC insurance     2,773     2,333     8,635     6,846  
Amortization of intangible assets     2,323     1,245     6,527     3,820  
Professional fees and services     6,577     4,509     16,403     12,354  
Other expenses     7,391     7,563     23,219     22,227  
Total non-interest expense     72,937     72,471     209,047     207,912  
Income before income tax expense     21,874     27,636     79,938     129,576  
Income tax expense     5,665     6,890     20,550     32,832  
Net income   $ 16,209   $ 20,746   $ 59,388   $ 96,744  
                 
Net income per share amounts:                
Basic net income per common share   $ 0.36   $ 0.46   $ 1.32   $ 2.16  
Diluted net income per common share   $ 0.36   $ 0.46   $ 1.31   $ 2.15  
Dividends declared per share   $ 0.34   $ 0.34   $ 1.02   $ 1.02  

Sandy Spring Bancorp, Inc. and Subsidiaries
HISTORICAL TRENDS – QUARTERLY FINANCIAL DATA – UNAUDITED

      2024       2023  
(Dollars in thousands, except per share data)   Q3   Q2   Q1   Q4   Q3   Q2   Q1
Profitability for the quarter:                            
Tax-equivalent interest income   $ 171,219     $ 166,252     $ 167,113     $ 166,729     $ 163,479     $ 159,156     $ 152,317  
Interest expense     88,686       84,828       86,671       83,920       77,330       67,679       54,045  
Tax-equivalent net interest income     82,533       81,424       80,442       82,809       86,149       91,477       98,272  
Tax-equivalent adjustment     1,121       1,139       1,099       1,113       1,068       1,006       970  
Provision/ (credit) for credit losses     6,316       1,020       2,388       (3,445 )     2,365       5,055       (21,536 )
Non-interest income     19,715       19,587       18,367       16,560       17,391       17,176       15,951  
Non-interest expense     72,937       68,104       68,006       67,142       72,471       69,136       66,305  
Income before income tax expense     21,874       30,748       27,316       34,559       27,636       33,456       68,484  
Income tax expense     5,665       7,941       6,944       8,459       6,890       8,711       17,231  
Net income   $ 16,209     $ 22,807     $ 20,372     $ 26,100     $ 20,746     $ 24,745     $ 51,253  
GAAP financial performance:                            
Return on average assets     0.46 %     0.66 %     0.58 %     0.73 %     0.58 %     0.70 %     1.49 %
Return on average common equity     4.01 %     5.81 %     5.17 %     6.70 %     5.35 %     6.46 %     13.93 %
Return on average tangible common equity     5.88 %     8.27 %     7.39 %     9.26 %     7.42 %     8.93 %     19.10 %
Net interest margin     2.44 %     2.46 %     2.41 %     2.45 %     2.55 %     2.73 %     2.99 %
Efficiency ratio – GAAP basis     72.12 %     68.19 %     69.60 %     68.33 %     70.72 %     64.22 %     58.55 %
Non-GAAP financial performance:                            
Pre-tax pre-provision net income   $ 28,190     $ 31,768     $ 29,704     $ 31,114     $ 30,001     $ 38,511     $ 46,948  
Core after-tax earnings   $ 17,936     $ 24,400     $ 21,916     $ 27,147     $ 27,766     $ 27,136     $ 52,253  
Core return on average assets     0.50 %     0.70 %     0.63 %     0.76 %     0.78 %     0.77 %     1.52 %
Core return on average common equity     4.44 %     6.21 %     5.56 %     6.97 %     7.16 %     7.09 %     14.20 %
Core return on average tangible common equity     5.88 %     8.27 %     7.39 %     9.26 %     9.51 %     9.43 %     19.11 %
Core earnings per diluted common share   $ 0.40     $ 0.54     $ 0.49     $ 0.60     $ 0.62     $ 0.60     $ 1.16  
Efficiency ratio – Non-GAAP basis     69.06 %     65.31 %     66.73 %     66.16 %     60.91 %     60.68 %     56.87 %
Per share data:                      
Net income attributable to common shareholders   $ 16,205     $ 22,800     $ 20,346     $ 26,066     $ 20,719     $ 24,712     $ 51,084  
Basic net income per common share   $ 0.36     $ 0.51     $ 0.45     $ 0.58     $ 0.46     $ 0.55     $ 1.14  
Diluted net income per common share   $ 0.36     $ 0.51     $ 0.45     $ 0.58     $ 0.46     $ 0.55     $ 1.14  
Weighted average diluted common shares     45,242,920       45,145,214       45,086,471       45,009,574       44,960,455       44,888,759       44,872,582  
Dividends declared per share   $ 0.34     $ 0.34     $ 0.34     $ 0.34     $ 0.34     $ 0.34     $ 0.34  
Non-interest income:                            
Service charges on deposit accounts     3,009       2,939       2,817       2,749       2,704       2,606       2,388  
Mortgage banking activities     1,529       1,621       1,374       792       1,682       1,817       1,245  
Wealth management income     10,738       10,455       9,958       9,219       9,391       9,031       8,992  
Income from bank owned life insurance     1,307       1,816       1,160       1,207       845       1,251       907  
Bank card fees     435       445       413       454       450       447       418  
Other income     2,697       2,311       2,645       2,139       2,319       2,024       2,001  
Total non-interest income   $ 19,715     $ 19,587     $ 18,367     $ 16,560     $ 17,391     $ 17,176     $ 15,951  
Non-interest expense:                            
Salaries and employee benefits   $ 41,030     $ 37,821     $ 36,698     $ 35,482     $ 44,853     $ 40,931     $ 38,926  
Occupancy expense of premises     4,657       4,805       4,816       4,558       4,609       4,764       4,847  
Equipment expenses     3,841       3,868       3,963       3,987       3,811       3,760       4,117  
Marketing     1,320       1,288       742       1,242       729       1,589       1,543  
Outside data services     3,025       3,286       3,103       3,000       2,819       2,853       2,514  
FDIC insurance     2,773       2,951       2,911       2,615       2,333       2,375       2,138  
Amortization of intangible assets     2,323       2,135       2,069       1,403       1,245       1,269       1,306  
Professional fees and services     6,577       4,946       4,880       5,628       4,509       4,161       3,684  
Other expenses     7,391       7,004       8,824       9,227       7,563       7,434       7,230  
Total non-interest expense   $ 72,937     $ 68,104     $ 68,006     $ 67,142     $ 72,471     $ 69,136     $ 66,305  

Sandy Spring Bancorp, Inc. and Subsidiaries
HISTORICAL TRENDS – QUARTERLY FINANCIAL DATA – UNAUDITED

      2024       2023  
(Dollars in thousands, except per share data)   Q3   Q2   Q1   Q4   Q3   Q2   Q1
Balance sheets at quarter end:                        
Commercial investor real estate loans   $ 4,868,467     $ 4,933,329     $ 4,997,879     $ 5,104,425     $ 5,137,694     $ 5,131,210     $ 5,167,456  
Commercial owner-occupied real estate loans     1,737,327       1,747,708       1,741,113       1,755,235       1,760,384       1,770,135       1,769,928  
Commercial AD&C loans     1,255,609       1,184,296       1,090,259       988,967       938,673       1,045,742       1,046,665  
Commercial business loans     1,620,926       1,601,510       1,509,592       1,504,880       1,454,709       1,423,614       1,437,478  
Residential mortgage loans     1,529,786       1,521,890       1,511,624       1,474,521       1,432,051       1,385,743       1,328,524  
Residential construction loans     53,639       78,027       97,685       121,419       160,345       190,690       223,456  
Consumer loans     426,167       417,161       416,132       417,542       416,436       422,505       421,734  
Total loans     11,491,921       11,483,921       11,364,284       11,366,989       11,300,292       11,369,639       11,395,241  
Allowance for credit losses – loans     (131,428 )     (125,863 )     (123,096 )     (120,865 )     (123,360 )     (120,287 )     (117,613 )
Residential mortgage loans held for sale     21,489       18,961       16,627       10,836       19,235       21,476       16,262  
SBA loans held for sale     425                                      
Investment securities     1,440,488       1,401,511       1,405,490       1,414,453       1,392,078       1,463,554       1,528,336  
Total assets     14,383,073       14,008,343       13,888,133       14,028,172       14,135,085       13,994,545       14,129,007  
Noninterest-bearing demand deposits     2,903,063       2,931,405       2,817,928       2,914,161       3,013,905       3,079,896       3,228,678  
Total deposits     11,737,694       11,340,228       11,227,200       10,996,538       11,151,012       10,958,922       11,075,991  
Customer repurchase agreements     70,767       75,038       71,529       75,032       66,581       74,510       47,627  
Total stockholders’ equity     1,628,837       1,599,004       1,589,364       1,588,142       1,537,914       1,539,032       1,536,865  
Quarterly average balance sheets:                        
Commercial investor real estate loans   $ 4,874,003     $ 4,964,406     $ 5,057,334     $ 5,125,028     $ 5,125,459     $ 5,146,632     $ 5,136,204  
Commercial owner-occupied real estate loans     1,741,663       1,734,106       1,746,042       1,755,048       1,769,717       1,773,039       1,769,680  
Commercial AD&C loans     1,253,035       1,133,506       1,030,763       960,646       995,682       1,057,205       1,082,791  
Commercial business loans     1,579,001       1,551,798       1,508,336       1,433,035       1,442,518       1,441,489       1,444,588  
Residential mortgage loans     1,526,445       1,518,748       1,491,277       1,451,614       1,406,929       1,353,809       1,307,761  
Residential construction loans     64,684       86,638       110,456       142,325       174,204       211,590       223,313  
Consumer loans     421,003       417,206       417,539       419,299       421,189       423,306       424,122  
Total loans     11,459,834       11,406,408       11,361,747       11,286,995       11,335,698       11,407,070       11,388,459  
Residential mortgage loans held for sale     19,889       14,497       8,142       10,132       13,714       17,480       8,324  
SBA loans held for sale     65                                      
Investment securities     1,531,378       1,538,624       1,536,127       1,544,173       1,589,342       1,639,324       1,679,593  
Interest-earning assets     13,474,697       13,292,995       13,411,810       13,462,583       13,444,117       13,423,589       13,316,165  
Total assets     14,136,037       13,956,261       14,061,935       14,090,423       14,086,342       14,094,653       13,949,276  
Noninterest-bearing demand deposits     2,783,906       2,790,620       2,730,295       2,958,254       3,041,101       3,137,971       3,480,433  
Total deposits     11,483,524       11,245,476       11,086,145       11,089,587       11,076,724       10,928,038       11,049,991  
Customer repurchase agreements     63,436       62,161       72,836       66,622       67,298       58,382       60,626  
Total interest-bearing liabilities     9,600,905       9,441,015       9,583,074       9,418,666       9,332,617       9,257,652       8,806,720  
Total stockholders’ equity     1,607,377       1,579,582       1,584,902       1,546,312       1,538,553       1,535,465       1,491,929  
Financial measures:                            
Average equity to average assets     11.37 %     11.32 %     11.27 %     10.97 %     10.92 %     10.89 %     10.70 %
Average investment securities to average earning assets     11.36 %     11.57 %     11.45 %     11.47 %     11.82 %     12.21 %     12.61 %
Average loans to average earning assets     85.05 %     85.81 %     84.71 %     83.84 %     84.32 %     84.98 %     85.52 %
Loans to assets     79.90 %     81.98 %     81.83 %     81.03 %     79.94 %     81.24 %     80.65 %
Loans to deposits     97.91 %     101.27 %     101.22 %     103.37 %     101.34 %     103.75 %     102.88 %
Assets under management   $ 6,567,752     $ 6,215,697     $ 6,165,509     $ 5,999,520     $ 5,536,499     $ 5,742,888     $ 5,477,560  
Capital measures:                            
Tier 1 leverage (1)     9.59 %     9.70 %     9.56 %     9.51 %     9.50 %     9.42 %     9.44 %
Common equity tier 1 capital to risk-weighted assets (1)     11.27 %     11.28 %     10.96 %     10.90 %     10.83 %     10.65 %     10.53 %
Tier 1 capital to risk-weighted assets (1)     11.27 %     11.28 %     10.96 %     10.90 %     10.83 %     10.65 %     10.53 %
Total regulatory capital to risk-weighted assets (1)     15.53 %     15.49 %     15.05 %     14.92 %     14.85 %     14.60 %     14.43 %
Book value per common share   $ 36.10     $ 35.45     $ 35.37     $ 35.36     $ 34.26     $ 34.31     $ 34.37  
Outstanding common shares     45,125,078       45,109,671       44,940,147       44,913,561       44,895,158       44,862,369       44,712,497  

(1) Estimated ratio at September 30, 2024.

Sandy Spring Bancorp, Inc. and Subsidiaries
LOAN PORTFOLIO QUALITY DETAIL – UNAUDITED

      2024     2023
(Dollars in thousands)   September 30,   June 30,   March 31,   December 31,   September 30,   June 30,   March 31,
Non-performing assets:                            
Loans 90 days past due:                            
Commercial real estate:                            
Commercial investor real estate   $   $   $   $   $   $   $ 215
Commercial owner-occupied real estate                            
Commercial AD&C                            
Commercial business             20     20     415     29     3,002
Residential real estate:                            
Residential mortgage     399     338     340     342         692     352
Residential construction                            
Consumer                            
Total loans 90 days past due     399     338     360     362     415     721     3,569
Non-accrual loans:                            
Commercial real estate:                            
Commercial investor real estate     57,578     55,498     55,579     58,658     20,108     20,381     15,451
Commercial owner-occupied real estate     9,639     9,403     4,394     4,640     4,744     4,846     4,949
Commercial AD&C     31,816     2,127     556     1,259     1,422     569    
Commercial business     9,044     8,455     7,164     10,051     9,671     9,393     9,443
Residential real estate:                            
Residential mortgage     11,996     12,228     11,835     12,332     10,766     10,153     8,935
Residential construction     539     539     542     443     449        
Consumer     4,258     4,400     4,011     4,102     4,187     3,396     4,900
Total non-accrual loans     124,870     92,650     84,081     91,485     51,347     48,738     43,678
Total non-performing loans     125,269     92,988     84,441     91,847     51,762     49,459     47,247
Other real estate owned (OREO)     3,265     2,700     2,700         261     611     645
Total non-performing assets   $ 128,534   $ 95,688   $ 87,141   $ 91,847   $ 52,023   $ 50,070   $ 47,892
    For the Quarter Ended,
(Dollars in thousands)   September 30,
2024
  June 30,
2024
  March 31,
2024
  December 31,
2023
  September 30,
2023
  June 30,
2023
  March 31,
2023
Analysis of non-accrual loan activity:                            
Balance at beginning of period   $ 92,650     $ 84,081     $ 91,485     $ 51,347     $ 48,738     $ 43,678     $ 34,782  
Non-accrual balances transferred to OREO     (565 )           (2,700 )                        
Non-accrual balances charged-off     (787 )           (1,550 )           (183 )     (2,049 )     (126 )
Net payments or draws     (3,095 )     (1,427 )     (4,017 )     (7,619 )     (1,545 )     (1,654 )     (10,212 )
Loans placed on non-accrual     36,667       10,038       1,490       47,920       4,967       9,276       19,714  
Non-accrual loans brought current           (42 )     (627 )     (163 )     (630 )     (513 )     (480 )
Balance at end of period   $ 124,870     $ 92,650     $ 84,081     $ 91,485     $ 51,347     $ 48,738     $ 43,678  
                             
Analysis of allowance for credit losses – loans:                            
Balance at beginning of period   $ 125,863     $ 123,096     $ 120,865     $ 123,360     $ 120,287     $ 117,613     $ 136,242  
Provision/ (credit) for credit losses – loans     6,310       2,961       3,331       (2,574 )     3,171       4,454       (18,945 )
Less loans charged-off, net of recoveries:                            
Commercial real estate:                            
Commercial investor real estate     397       (3 )     (2 )     (3 )     (3 )     (14 )     (5 )
Commercial owner-occupied real estate     (27 )     (27 )     (27 )     (27 )     (25 )     (27 )     (26 )
Commercial AD&C     111       (23 )     (283 )                        
Commercial business     250       (28 )     1,550       (105 )     15       363       (127 )
Residential real estate:                            
Residential mortgage     (35 )     39       (6 )     (6 )     (4 )     35       21  
Residential construction                                          
Consumer     49       236       (132 )     62       115       1,423       (179 )
Net charge-offs/ (recoveries)     745       194       1,100       (79 )     98       1,780       (316 )
Balance at the end of period   $ 131,428     $ 125,863     $ 123,096     $ 120,865     $ 123,360     $ 120,287     $ 117,613  
                             
Asset quality ratios:                            
Non-performing loans to total loans     1.09 %     0.81 %     0.74 %     0.81 %     0.46 %     0.44 %     0.41 %
Non-performing assets to total assets     0.89 %     0.68 %     0.63 %     0.65 %     0.37 %     0.36 %     0.34 %
Allowance for credit losses to loans     1.14 %     1.10 %     1.08 %     1.06 %     1.09 %     1.06 %     1.03 %
Allowance for credit losses to non-performing loans     104.92 %     135.35 %     145.78 %     131.59 %     238.32 %     243.21 %     248.93 %
Annualized net charge-offs/ (recoveries) to average loans     0.03 %     0.01 %     0.04 %     %     %     0.06 %   (0.01 )%

Sandy Spring Bancorp, Inc. and Subsidiaries
CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES – UNAUDITED

    Three Months Ended September 30,
      2024       2023  
(Dollars in thousands and tax-equivalent)   Average
Balances
  Interest (1)   Annualized
Average
Yield/Rate
  Average
Balances
  Interest (1)   Annualized
Average
Yield/Rate
Assets                        
Commercial investor real estate loans   $ 4,874,003     $ 58,133   4.74 %   $ 5,125,459     $ 60,482   4.68 %
Commercial owner-occupied real estate loans     1,741,663       21,609   4.94       1,769,717       20,865   4.68  
Commercial AD&C loans     1,253,035       24,553   7.80       995,682       20,503   8.17  
Commercial business loans     1,579,001       26,953   6.79       1,442,518       23,343   6.42  
Total commercial loans     9,447,702       131,248   5.53       9,333,376       125,193   5.32  
Residential mortgage loans     1,526,445       14,223   3.73       1,406,929       12,550   3.57  
Residential construction loans     64,684       876   5.39       174,204       1,680   3.83  
Consumer loans     421,003       8,653   8.18       421,189       8,491   8.00  
Total residential and consumer loans     2,012,132       23,752   4.71       2,002,322       22,721   4.52  
Total loans (2)     11,459,834       155,000   5.38       11,335,698       147,914   5.18  
Residential mortgage loans held for sale     19,889       364   7.32       13,714       238   6.93  
SBA loans held for sale     65       2   11.28                
Taxable securities     1,197,301       7,440   2.49       1,239,564       6,682   2.16  
Tax-advantaged securities     334,077       2,222   2.66       349,778       2,269   2.59  
Total investment securities (3)     1,531,378       9,662   2.52       1,589,342       8,951   2.25  
Interest-bearing deposits with banks     463,531       6,191   5.31       505,017       6,371   5.00  
Federal funds sold                   346       5   5.38  
Total interest-earning assets     13,474,697       171,219   5.06       13,444,117       163,479   4.83  
                         
Less: allowance for credit losses – loans     (125,962 )             (122,348 )        
Cash and due from banks     82,172               93,354          
Premises and equipment, net     58,035               71,956          
Other assets     647,095               599,263          
Total assets   $ 14,136,037             $ 14,086,342          
                         
Liabilities and Stockholders’ Equity                        
Interest-bearing demand deposits   $ 1,427,739     $ 6,256   1.74 %   $ 1,419,934     $ 4,229   1.18 %
Regular savings deposits     1,718,475       15,341   3.55       861,634       5,571   2.57  
Money market savings deposits     3,018,799       28,999   3.82       2,866,744       25,122   3.48  
Time deposits     2,534,605       28,691   4.50       2,887,311       28,180   3.87  
Total interest-bearing deposits     8,699,618       79,287   3.63       8,035,623       63,102   3.12  
Repurchase agreements     63,436       334   2.09       67,298       356   2.10  
Federal funds purchased and Federal Reserve Bank borrowings     8,543       118   5.53       300,435       3,726   4.92  
Advances from FHLB     458,152       5,001   4.34       558,696       6,200   4.40  
Subordinated debt     371,156       3,946   4.25       370,565       3,946   4.26  
Total borrowings     901,287       9,399   4.15       1,296,994       14,228   4.35  
Total interest-bearing liabilities     9,600,905       88,686   3.68       9,332,617       77,330   3.29  
                         
Noninterest-bearing demand deposits     2,783,906               3,041,101          
Other liabilities     143,849               174,071          
Stockholders’ equity     1,607,377               1,538,553          
Total liabilities and stockholders’ equity   $ 14,136,037             $ 14,086,342          
                         
Tax-equivalent net interest income and spread       $ 82,533   1.38 %       $ 86,149   1.54 %
Less: tax-equivalent adjustment         1,121             1,068    
Net interest income       $ 81,412           $ 85,081    
                         
Interest income/earning assets           5.06 %           4.83 %
Interest expense/earning assets           2.62             2.28  
Net interest margin           2.44 %           2.55 %
(1) Tax-equivalent income has been adjusted using the combined marginal federal and state rate of 25.48% and 25.37% for 2024 and 2023, respectively. The annualized taxable-equivalent adjustments utilized in the above table to compute yields aggregated to $1.1 million and $1.1 million in 2024 and 2023, respectively.
(2) Non-accrual loans are included in the average balances.
(3) Available-for-sale investments are presented at amortized cost.

Sandy Spring Bancorp, Inc. and Subsidiaries
CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES – UNAUDITED

    Nine Months Ended September 30,
      2024       2023  
(Dollars in thousands and tax-equivalent)   Average
Balances
  Interest (1)   Annualized
Average
Yield/Rate
  Average
Balances
  Interest (1)   Annualized
Average
Yield/Rate
Assets                        
Commercial investor real estate loans   $ 4,964,914     $ 176,504   4.75 %   $ 5,136,059     $ 177,067   4.61 %
Commercial owner-occupied real estate loans     1,740,608       63,090   4.84       1,770,812       61,038   4.61  
Commercial AD&C loans     1,139,517       68,779   8.06       1,044,907       61,005   7.81  
Commercial business loans     1,546,498       79,026   6.83       1,442,858       68,258   6.33  
Total commercial loans     9,391,537       387,399   5.51       9,394,636       367,368   5.23  
Residential mortgage loans     1,512,209       41,968   3.70       1,356,530       35,925   3.53  
Residential construction loans     87,177       3,208   4.92       202,856       5,302   3.49  
Consumer loans     418,591       25,693   8.20       422,861       24,403   7.72  
Total residential and consumer loans     2,017,977       70,869   4.69       1,982,247       65,630   4.42  
Total loans (2)     11,409,514       458,268   5.36       11,376,883       432,998   5.09  
Residential mortgage loans held for sale     14,197       801   7.52       13,192       697   7.04  
SBA loans held for sale     22       2   11.28                
Taxable securities     1,195,481       21,319   2.38       1,275,407       20,538   2.15  
Tax-advantaged securities     339,881       6,785   2.66       360,348       6,727   2.49  
Total investment securities (3)     1,535,362       28,104   2.44       1,635,755       27,265   2.22  
Interest-bearing deposits with banks     434,083       17,401   5.35       368,829       13,979   5.07  
Federal funds sold     288       8   3.79       433       13   4.00  
Total interest-earning assets     13,393,466       504,584   5.03       13,395,092       474,952   4.74  
                         
Less: allowance for credit losses – loans     (122,971 )             (125,558 )        
Cash and due from banks     83,265               94,960          
Premises and equipment, net     59,124               70,130          
Other assets     638,838               609,301          
Total assets   $ 14,051,722             $ 14,043,925          
                         
Liabilities and Stockholders’ Equity                        
Interest-bearing demand deposits   $ 1,467,517     $ 18,858   1.72 %   $ 1,413,876     $ 10,465   0.99 %
Regular savings deposits     1,602,997       42,597   3.55       660,211       7,831   1.59  
Money market savings deposits     2,847,006       79,190   3.72       3,067,810       68,976   3.01  
Time deposits     2,586,639       86,417   4.46       2,658,225       67,943   3.42  
Total interest-bearing deposits     8,504,159       227,062   3.57       7,800,122       155,215   2.66  
Repurchase agreements     66,134       1,043   2.11       62,126       561   1.21  
Federal funds purchased and Federal Reserve Bank borrowings     99,303       3,847   5.17       264,580       9,816   4.96  
Advances from FHLB     501,277       16,394   4.37       637,015       21,623   4.54  
Subordinated debt     371,009       11,839   4.25       370,412       11,839   4.26  
Total borrowings     1,037,723       33,123   4.26       1,334,133       43,839   4.39  
Total interest-bearing liabilities     9,541,882       260,185   3.64       9,134,255       199,054   2.91  
                         
Noninterest-bearing demand deposits     2,768,331               3,218,226          
Other liabilities     150,827               169,291          
Stockholders’ equity     1,590,682               1,522,153          
Total liabilities and stockholders’ equity   $ 14,051,722             $ 14,043,925          
                         
Tax-equivalent net interest income and spread       $ 244,399   1.39 %       $ 275,898   1.83 %
Less: tax-equivalent adjustment         3,359             3,044    
Net interest income       $ 241,040           $ 272,854    
                         
Interest income/earning assets           5.03 %           4.74 %
Interest expense/earning assets           2.59             1.99  
Net interest margin           2.44 %           2.75 %
(1) Tax-equivalent income has been adjusted using the combined marginal federal and state rate of 25.48% and 25.37% for 2024 and 2023, respectively. The annualized taxable-equivalent adjustments utilized in the above table to compute yields aggregated to $3.4 million and $3.0 million in 2024 and 2023, respectively.
(2) Non-accrual loans are included in the average balances.
(3) Available-for-sale investments are presented at amortized cost.


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