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Item 5. Market for Registrant’s Common Equity

2022-02-10 compared with 2021-02-10 · 14 added, 76 removed, 13 unchanged (87% of the section changed)

7 unchanged sentences

Announced Plans

or Programs Maximum Number

of Shares that May

Yet Be Purchased

Under the Plans

or Programs (2) Maximum Dollar

Value of Shares that

Purchased Under

or Programs (2)

10/1/21 - 10/31/21 561 $17.21 — $100,000,000

2 unchanged sentences

Total 1,038 $17.38 — $100,000,000

In the first quarter of 2020, the Board of Directors approved the repurchase of up to 7.0 million shares of the Company’s Common Stock to be repurchased, as conditions warrant, through January 31, 2021.

During the year ended December 31, 2020, Old National also repurchased a limited number of shares associated with employee share-based incentive programs.

(1) Reflects the repurchase of shares associated with employee share-based incentive programs.

(2) In the first quarter of 2021, the Board of Directors approved the adoption of a stock repurchase plan that authorizes the repurchase of up to $100 million of shares of Common Stock, as conditions warrant, through January 31, 2022.

No shares were purchased under the stock repurchase program during the fourth quarter of 2021.

On January 27, 2022, the Board of Directors declared a quarterly cash dividend of $0.14 per common share.

The Board of Directors also approved the adoption of a stock repurchase plan that authorizes the repurchase of up to $100 million of shares of Common Stock, as conditions warrant, through January 31, 2022.

EQUITY COMPENSATION PLAN INFORMATION

The following table contains information concerning the Amended and Restated 2008 Incentive Compensation Plan approved by the Company’s shareholders, as of December 31, 2020.

Number of securities to

be issued upon exercise

of outstanding options,

warrants, and rights Weighted-average

exercise price of

outstanding options,

warrants, and rights Number of securities

remaining available for

future issuance under

equity compensation plans

(excluding securities

reflected in column (a))

Plan Category (a) (b) (c)

Equity compensation plans

approved by security holders 1,509,777 $14.40 2,915,531

Equity compensation plans not

approved by security holders — — —

Total 1,509,777 $14.40 2,915,531

At December 31, 2020, 2.9 million shares remain available for issuance under the Amended and Restated 2008 Incentive Compensation Plan.

The following table compares cumulative five-year total shareholder returns, assuming reinvestment of dividends, for our Common Stock to cumulative total returns of a broad-based equity market index and two published industry indices.

The comparison of shareholder returns (change in December year end stock price plus reinvested dividends) for each of the periods assumes that $100 was invested on December 31, 2015, in common stock of each of the Company, the S&P Small Cap 600 Index, the NYSE Financial Index and the SNL Bank and Thrift Index, with investment weighted on the basis of market capitalization.

SELECTED FINANCIAL DATA

(dollars and shares in thousands, except per share data) 2020 2019 2018 2017 2016

Operating Results

Net interest income $ 596,094 $ 604,273 $ 537,602 $ 437,168 $ 402,703

Taxable equivalent adjustment (1) 13,586 12,940 11,394 23,091 21,293

Net interest income - tax equivalent basis 609,680 617,213 548,996 460,259 423,996

Provision for loan losses (2) 38,395 4,747 6,966 3,050 960

Noninterest income 239,274 199,317 195,305 183,382 252,830

Noninterest expense 541,417 508,487 517,261 448,836 454,147

Net income 226,409 238,206 190,830 95,725 134,264

Common Share Data (3)

Weighted average diluted shares 166,177 172,687 156,539 138,513 128,301

Net income (diluted) $ 1.36 $ 1.38 $ 1.22 $ 0.69 $ 1.05

Cash dividends 0.56 0.52 0.52 0.52 0.52

Common dividend payout ratio (4) 41 % 37 % 42 % 75 % 50 %

Book value at year-end $ 17.98 $ 16.82 $ 15.36 $ 14.17 $ 13.42

Stock price at year-end 16.56 18.29 15.40 17.45 18.15

Balance Sheet Data (at December 31)

Loans (5) $ 13,849,729 $ 12,164,422 $ 12,258,803 $ 11,136,051 $ 9,101,194

Total assets 22,960,622 20,411,667 19,728,435 17,518,292 14,860,237

Deposits 17,037,453 14,553,397 14,349,949 12,605,764 10,743,253

Borrowings 2,676,554 2,744,728 2,493,793 2,578,204 2,152,086

Shareholders' equity 2,972,656 2,852,453 2,689,570 2,154,397 1,814,417

Performance Ratios

Return on average assets 1.04 % 1.19 % 1.07 % 0.63 % 0.98 %

Return on average common shareholders' equity 7.87 8.57 8.42 4.98 7.84

Net interest margin (6) 3.18 3.55 3.54 3.48 3.58

Efficiency ratio (6) 62.91 60.35 67.74 68.87 65.82

Asset Quality (7)

Net charge-offs (recoveries) to average loans 0.02 % 0.05 % 0.02 % 0.03 % 0.04 %

Allowance for loan losses to ending loans (2) 0.95 0.45 0.45 0.45 0.55

Allowance for loan losses (2) $ 131,388 $ 54,619 $ 55,461 $ 50,381 $ 49,808

Underperforming assets (8) 166,579 147,489 179,425 154,220 164,657

Allowance for loan losses to nonaccrual loans (2) 89.17 % 43.21 % 35.22 % 40.33 % 37.90 %

Full-time equivalent employees 2,445 2,709 2,892 2,801 2,733

Banking centers 162 192 191 191 203

(1) Calculated using the federal statutory tax rate in effect of 21% for 2018 - 2020 and 35% for 2016 - 2017.

(2) Beginning January 1, 2020, calculation is based on current expected loss methodology.

Prior to January 1, 2020, calculation is based on incurred loss methodology.

(3) Diluted data assumes the exercise of stock appreciation rights and the vesting of restricted stock.

(4) Cash dividends per share divided by net income per share (basic).

(5) Includes loans held for sale.

(6) Represents a non-GAAP financial measure.

Refer to the “Non-GAAP Financial Measures” section of Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for reconciliations to GAAP financial measures.

(7) Excludes loans held for sale.

(8) Includes nonaccrual loans, TDRs still accruing, loans 90 days past due still accruing, and other real estate owned.

The table below compares cumulative five-year total shareholder returns, assuming reinvestment of dividends, for our Common Stock to cumulative total returns of a broad-based equity market index and published industry indices.

Our considerations in the selection of indices for the year ended December 31, 2021 included:

• the S&P 500 Index as a more appropriate broad-based equity market index than the NYSE Financial Index since our common stock is not listed on the New York stock exchange;

• the KBW NASDAQ Bank Index as an appropriate industry representation on the exchange in which our common stock is traded to replace the SNL Bank and Thrift Index because the SNL Bank and Thrift Index is no longer published;

• the KBW NASDAQ Regional Banking Index as a more appropriate peer group index than the S&P SmallCap 600 Index since NASDAQ is the exchange in which our common stock is traded.

The comparison of shareholder returns (change in December year end stock price plus reinvested dividends) for each of the periods assumes that $100 was invested on December 31, 2016, in common stock of each of the Company, the S&P 500 Index, the KBW NASDAQ Bank Index, the KBW NASDAQ Regional Banking Index, the S&P SmallCap 600 Index, and the NYSE Financial Index, with investment weighted on the basis of market capitalization.

S&P Global Market Intelligence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 5. Market for Registrant’s Common Equity