EVANSVILLE, Ind., April 22, 2025 (GLOBE NEWSWIRE) --

CEO COMMENTARY:

FIRST QUARTER HIGHLIGHTS²:

¹ Non-GAAP financial measure that management believes is useful in evaluating the financial results of the Company – refer to the Non-GAAP reconciliations contained in this release ² Comparisons are on a linked-quarter basis, unless otherwise noted ³ Includes loans held-for-sale ⁴ Includes the provision for unfunded commitments

RESULTS OF OPERATIONS²
Old National Bancorp ("Old National") reported first quarter 2025 net income applicable to common shares of $140.6 million, or $0.44 per diluted common share.

Included in first quarter results were pre-tax charges of $5.9 million for merger-related expenses. Excluding these charges and realized debt securities losses from the current quarter, adjusted net income¹ was $145.5 million, or $0.45 per diluted common share.

DEPOSITS AND FUNDING
Growth in core deposits driven by normal seasonal patterns in business checking and public funds, along with growth in community deposits.

• Period-end total deposits were $41.0 billion, up 2.1% annualized; core deposits up 1.7% annualized.
• On average, total deposits for the first quarter were $40.5 billion, down 6.2% annualized.
• Granular low-cost deposit franchise; total deposit costs of 191 bps, down 17 bps.
• A loan to deposit ratio of 89%, combined with existing funding sources, provides strong liquidity.

LOANS
Balanced commercial loan production, growth and pipeline.

• Period-end total loans³ were $36.5 billion, up 1.5% annualized; up 2.3% annualized excluding $71 million of commercial real estate loan sales.
• Total commercial loan production in the first quarter was $1.5 billion; period-end commercial pipeline totaled $3.4 billion.
• Average total loans in the first quarter were $36.3 billion, a decrease of $128.2 million, or down 1.4% annualized.

CREDIT QUALITY
Resilient credit quality continues to be a hallmark of Old National.

• Provision⁴ expense was $31.4 million compared to $27.0 million.
• Net charge-offs were $21.6 million, or 24 bps of average loans compared to 21 bps.
  • Excluding PCD loans that had an allowance for credit losses established at acquisition, net charge-offs to average loans were 21 bps compared to 17 bps.
• 30+ day delinquencies as a percentage of loans were 0.22% compared to 0.27%.
• Nonaccrual loans as a percentage of total loans were 1.29% compared to 1.23%.
• Loans acquired from previous acquisitions were recorded at fair value at the acquisition date. The remaining discount on these acquired loans was $119.2 million.
• The allowance for credit losses, including the allowance for credit losses on unfunded commitments, stood at $424.0 million, or 1.16% of total loans, compared to $414.2 million, or 1.14% of total loans.

NET INTEREST INCOME AND MARGIN
Lower reflective of lower accretion and number of days.

• Net interest income on a fully taxable equivalent basis¹ decreased to $393.0 million compared to $400.0 million, driven by lower accretion, fewer days in the quarter and earning asset mix, partly offset by lower funding costs.
• Net interest margin on a fully taxable equivalent basis¹ decreased 3 bps to 3.27%.
• Accretion income on loans and borrowings was $12.3 million, or 10 bps of net interest margin¹, compared to $18.5 million, or 15 bps of net interest margin¹.
• Cost of total deposits was 1.91%, decreasing 17 bps and the cost of total interest-bearing deposits decreased 25 bps to 2.46%.

NONINTEREST INCOME
Impacted by seasonally lower bank fees and lower company-owned life insurance.

• Total noninterest income was $93.8 million compared to $95.8 million.
• Noninterest income decreased 2.1% driven by seasonally lower bank fees and lower company-owned life insurance.
  • Other income was impacted by $4.8 million of gains on the sale of $71 million of commercial real estate loans in the first quarter of 2025 and $8 million of equity investments recoveries in the fourth quarter of 2024.

NONINTEREST EXPENSE
Disciplined expense management.

• Noninterest expense was $268.5 million and included $5.9 million of merger-related charges.
  • Excluding merger-related charges, adjusted noninterest expense¹ was $262.6 million, compared to $268.7 million; decrease driven by lower FDIC assessment expense and tax credit amortization.
• The efficiency ratio¹ was 53.7%, while the adjusted efficiency ratio¹ was 51.8% compared to 54.4% and 51.8%, respectively.

INCOME TAXES

• Income tax expense was $36.9 million, resulting in an effective tax rate of 20.3% compared to 17.3%. On an adjusted fully taxable equivalent ("FTE") basis, the effective tax rate was 22.6% compared to 19.8%.
  • The effective tax rate for the first quarter of 2025 was impacted by $1.2 million for the vesting of employee stock compensation and the fourth quarter of 2024 was impacted by $5.9 million for the resolution of tax matters.
• Income tax expense included $5.3 million of tax credit benefit compared to $5.2 million.

CAPITAL
Capital ratios remain strong.

• Preliminary total risk-based capital up 31 bps to 13.68% and preliminary regulatory Tier 1 capital up 25 bps to 12.23%, as strong retained earnings drive capital.
• Tangible common equity to tangible assets was 7.76%, up 4.7%.

CONFERENCE CALL AND WEBCAST
Old National will host a conference call and live webcast at 9:00 a.m. Central Time on Tuesday, April 22, 2025, to review first quarter financial results. The live audio webcast link and corresponding presentation slides will be available on the Company’s Investor Relations website at oldnational.com and will be archived there for 12 months. To listen to the live conference call, dial U.S. (800) 715-9871 or International (646) 307-1963, access code 5176690. A replay of the call will also be available from approximately noon Central Time on April 22, 2025 through May 6, 2025. To access the replay, dial U.S. (800) 770-2030 or International (647) 362-9199; Access code 5176690.

ABOUT OLD NATIONAL
Old National Bancorp (NASDAQ: ONB) is the holding company of Old National Bank. As the sixth largest commercial bank headquartered in the Midwest, Old National proudly serves clients primarily in the Midwest and Southeast. With approximately $54 billion of assets and $29 billion of assets under management, Old National ranks among the top 30 banking companies headquartered in the United States. Tracing our roots to 1834, Old National focuses on building long-term, highly valued partnerships with clients while also strengthening and supporting the communities we serve. In addition to providing extensive services in consumer and commercial banking, Old National offers comprehensive wealth management and capital markets services. For more information and financial data, please visit Investor Relations at oldnational.com. In 2024, Points of Light named Old National one of "The Civic 50" - an honor reserved for the 50 most community-minded companies in the United States.

USE OF NON-GAAP FINANCIAL MEASURES
The Company's accounting and reporting policies conform to U.S. generally accepted accounting principles ("GAAP") and general practices within the banking industry. As a supplement to GAAP, the Company provides non-GAAP performance results, which the Company believes are useful because they assist investors in assessing the Company's operating performance. Where non-GAAP financial measures are used, the comparable GAAP financial measure, as well as the reconciliation to the comparable GAAP financial measure, can be found in the tables at the end of this release.

The Company presents EPS, the efficiency ratio, return on average common equity, return on average tangible common equity, and net income applicable to common shares, all adjusted for certain notable items. These items include merger-related charges associated with completed and pending acquisitions, debt securities gains/losses, separation expense, CECL Day 1 non-PCD provision expense, distribution of excess pension assets expense, and FDIC special assessment expense. Management believes excluding these items from EPS, the efficiency ratio, return on average common equity, and return on average tangible common equity may be useful in assessing the Company's underlying operational performance since these items do not pertain to its core business operations and their exclusion may facilitate better comparability between periods. Management believes that excluding merger-related charges from these metrics may be useful to the Company, as well as analysts and investors, since these expenses can vary significantly based on the size, type, and structure of each acquisition. Additionally, management believes excluding these items from these metrics may enhance comparability for peer comparison purposes.

Income tax expense, provision for credit losses, and the certain notable items listed above are excluded from the calculation of pre-provision net revenues, adjusted due to the fluctuation in income before income tax and the level of provision for credit losses required. Management believes adjusted pre-provision net revenues may be useful in assessing the Company's underlying operating performance and their exclusion may facilitate better comparability between periods and for peer comparison purposes.

The Company presents adjusted noninterest expense, which excludes merger-related charges associated with completed and pending acquisitions, separation expense, distribution of excess pension assets expense, and FDIC special assessment expense, as well as adjusted noninterest income, which excludes debt securities gains/losses. Management believes that excluding these items from noninterest expense and noninterest income may be useful in assessing the Company’s underlying operational performance as these items either do not pertain to its core business operations or their exclusion may facilitate better comparability between periods and for peer comparison purposes.

The tax-equivalent adjustment to net interest income and net interest margin recognizes the income tax savings when comparing taxable and tax-exempt assets. Interest income and yields on tax-exempt securities and loans are presented using the current federal income tax rate of 21%. Management believes that it is standard practice in the banking industry to present net interest income and net interest margin on a fully tax-equivalent basis and that it may enhance comparability for peer comparison purposes.

In management's view, tangible common equity measures are capital adequacy metrics that may be meaningful to the Company, as well as analysts and investors, in assessing the Company's use of equity and in facilitating comparisons with peers. These non-GAAP measures are valuable indicators of a financial institution's capital strength since they eliminate intangible assets from stockholders' equity and retain the effect of accumulated other comprehensive loss in stockholders' equity.

Although intended to enhance investors' understanding of the Company's business and performance, these non-GAAP financial measures should not be considered an alternative to GAAP. In addition, these non-GAAP financial measures may differ from those used by other financial institutions to assess their business and performance. See the following reconciliations in the "Non-GAAP Reconciliations" section for details on the calculation of these measures to the extent presented herein.

FORWARD-LOOKING STATEMENTS
This communication contains certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 (the “Act”), notwithstanding that such statements are not specifically identified as such. In addition, certain statements may be contained in our future filings with the Securities and Exchange Commission ("SEC"), in press releases, and in oral and written statements made by us that are not statements of historical fact and constitute forward‐looking statements within the meaning of the Act. These statements include, but are not limited to, descriptions of Old National’s financial condition, results of operations, asset and credit quality trends, profitability and business plans or opportunities. Forward-looking statements can be identified by the use of words such as "anticipate," "believe," "contemplate," "continue," "could," "estimate," "expect," "guidance," "intend," "may," "outlook," "plan," "potential," "predict," "should," "would," and "will," and other words of similar meaning. These forward-looking statements express management’s current expectations or forecasts of future events and, by their nature, are subject to risks and uncertainties. There are a number of factors that could cause actual results or outcomes to differ materially from those in such statements, including, but not limited to: competition; government legislation, regulations and policies, including trade and tariff policies; the ability of Old National to execute its business plan; unanticipated changes in our liquidity position, including but not limited to changes in our access to sources of liquidity and capital to address our liquidity needs; changes in economic conditions and economic and business uncertainty which could materially impact credit quality trends and the ability to generate loans and gather deposits; inflation and governmental responses to inflation, including increasing interest rates; market, economic, operational, liquidity, credit, and interest rate risks associated with our business; our ability to successfully manage our credit risk and the sufficiency of our allowance for credit losses; the possibility that the merger (the “Merger”) between Old National and Bremer Financial Corporation ("Bremer") does not close when expected; the expected cost savings, synergies and other financial benefits from the Merger not being realized within the expected time frames and costs or difficulties relating to integration matters being greater than expected; potential adverse reactions or changes to business or employee relationships, including those resulting from the completion of the Merger; the impact of purchase accounting with respect to the Merger, or any change in the assumptions used regarding the assets acquired and liabilities assumed to determine their fair value and credit marks; risks relating to the potential dilutive effect of shares of Old National’s common stock to be issued in the Merger; the potential impact of future business combinations on our performance and financial condition, including our ability to successfully integrate the businesses, the success of revenue-generating and cost reduction initiatives and the diversion of management’s attention from ongoing business operations and opportunities; failure or circumvention of our internal controls; operational risks or risk management failures by us or critical third parties, including without limitation with respect to data processing, information systems, cybersecurity, technological changes, vendor issues, business interruption, and fraud risks; significant changes in accounting, tax or regulatory practices or requirements; new legal obligations or liabilities; disruptive technologies in payment systems and other services traditionally provided by banks; failure or disruption of our information systems; computer hacking and other cybersecurity threats; the effects of climate change on Old National and its customers, borrowers, or service providers; the impacts of pandemics, epidemics and other infectious disease outbreaks; other matters discussed in this communication; and other factors identified in our Annual Report on Form 10-K for the year ended December 31, 2024 and other filings with the SEC. These forward-looking statements are made only as of the date of this communication and are not guarantees of future results, performance or outcomes, and Old National does not undertake an obligation to update these forward-looking statements to reflect events or conditions after the date of this communication.