First Midwest Bancorp, Inc. Announces 2015 Fourth Quarter and Full Year Results

ITASCA, IL--(Marketwired - Jan 26, 2016) -  First Midwest Bancorp, Inc. (the "Company" or "First Midwest") (NASDAQ: FMBI), the holding company of First Midwest Bank (the "Bank"), today reported results of operations and financial condition for the fourth quarter of 2015. Net income for the fourth quarter of 2015 was $16.3 million, or $0.21 per share. This compares to $23.3 million, or $0.30 per share, for the third quarter of 2015, and $14.6 million, or $0.19 per share, for the fourth quarter of 2014. Fourth quarter performance for the current and prior year was impacted by acquisition and integration related pre-tax expenses of $1.4 million and $9.3 million, respectively, or $0.01 and $0.07 per share after tax. In addition, a non-cash property valuation pre-tax adjustment of $8.6 million, or $0.07 per share after tax, was recorded in the fourth quarter of 2015 as a result of previously announced strategic branch initiatives. Excluding these expenses, earnings per share was $0.29 for the fourth quarter of 2015 compared to $0.27 for the fourth quarter of 2014, an increase of 7%.

For the full year of 2015, the Company reported net income of $82.1 million, or $1.05 per share, compared to $69.3 million, or $0.92 per share, for the year ended December 31, 2014. Earnings per share was $1.13 for the year ended December 31, 2015, excluding the valuation adjustment and acquisition and integration related expenses, and $1.03 for the year ended December 31, 2014, excluding acquisition and integration related expenses.

SELECT FOURTH QUARTER HIGHLIGHTS

• Increased earnings per share to $0.29, or 7%, compared to the fourth quarter of 2014, excluding the valuation adjustment and acquisition and integration related expenses.
  
  
• Expanded fee-based revenues to $34 million, an increase of 16% from the fourth quarter of 2014.
  
  
• Grew total loans to over $7 billion, up 7% from December 31, 2014 and 15% annualized from September 30, 2015.
  
  
• Reduced non-performing assets to $62 million, a decline of 33% from December 31, 2014 and 13% from September 30, 2015.
  
  
• Reduced loans past due 30-89 days to $16 million, down 19% from December 31, 2014 and 43% from September 30, 2015.
  
  
• Completed the acquisition of The Peoples' Bank of Arlington Heights on December 3, 2015, adding $92 million in deposits and $57 million in loans, and concluded the conversion of operating systems on December 7, 2015.
  
  
• Announced the acquisition of The National Bank & Trust Company of Sycamore on November 12, 2015, with $680 million in assets and $700 million in trust assets under management, receiving Bank Regulatory approvals by mid-January of 2016.
  
  

"It was an active quarter and year, reflecting strong progress on a number of business fronts and positioning us well as we enter 2016," said Michael L. Scudder, President and Chief Executive Officer of First Midwest Bancorp, Inc. "Business growth was solid in an intensely competitive environment, with performance impacted by both prior and current year acquisitions as well as ongoing strategic efforts to optimize our branch distribution network. Excluding charges attendant to these activities, performance for the quarter was up 7% as compared to last year. Late year and expected first quarter of 2016 acquisitions will grow our Company by some 10% in assets and further expand our wealth management capabilities and branch distribution network in the western markets of metro Chicago."

Mr. Scudder continued, "As we look ahead, 2016 is looking to be a year of transition for the industry and First Midwest. An evolving, upward rate environment will require balanced financial management. At the same time, the growth of our Company will be accompanied by greater regulatory oversight and expectations. We are well prepared to navigate this transition, leveraging the strength of our balance sheet, products, distribution, and an engaged team of colleagues to grow and enhance shareholder returns."

RECENT EVENTS

Strategic Branch Initiatives

On January 15, 2016, the Company announced planned strategic branch initiatives to enhance its customer experience, branch network, and operating efficiency. Based on the Company's ongoing analysis of its existing distribution network as well as customer preference and usage patterns, the Company will open a full service branch in the attractive Naperville, Illinois and downtown Chicago markets during the first quarter of 2016, consolidate four existing branches into nearby operating locations, and sell twelve closed branches and seven parcels of land previously purchased for expansion.

The orderly execution of these plans over the near term will result in an annual pre-tax reduction of ongoing operating costs of approximately $3.6 million, 60% of which the Company expects to realize in 2016. In furtherance of these initiatives, First Midwest recorded a pre-tax, non-cash valuation adjustment of $8.6 million, or $0.07 per share after tax, as of December 31, 2015 for those properties designated for sale.

Pending Acquisition

The National Bank & Trust Company of Sycamore

On November 12, 2015, the Company entered into a definitive agreement to acquire NI Bancshares Corporation, the holding company for The National Bank & Trust Company of Sycamore ("NB&T"). With the acquisition, the Company will acquire ten banking offices in northern Illinois, $415 million in loans, and $600 million in deposits. In addition, the Company will acquire over $700 million in trust assets under management which represents approximately a 10% increase in the Company's current trust assets under management. The merger consideration will be a combination of Company common stock and cash, with an overall transaction value of $70 million. The Company received approval for this acquisition from the Federal Reserve on January 5, 2016 and the Illinois Department of Financial and Professional Regulation on January 15, 2016. The acquisition is expected to close and the operating systems converted late in the first quarter of 2016, subject to approval by the stockholders of NB&T and customary closing conditions.

Completed Acquisition

The Peoples' Bank of Arlington Heights

On December 3, 2015, the Company completed the acquisition of Peoples Bancorp, Inc. and its wholly-owned banking subsidiary, The Peoples' Bank of Arlington Heights ("Peoples Bank"), which was previously announced on September 21, 2015. With the acquisition, the Company acquired two banking offices in Arlington Heights, Illinois, and approximately $92 million in deposits and $57 million in loans. The conversion of operating systems concluded on December 7, 2015.

OPERATING PERFORMANCE

Net Interest Income and Margin Analysis

(Dollar amounts in thousands)

				Quarters Ended
				December 31, 2015										September 30, 2015										December 31, 2014
				Average Balance				Interest Earned/ Paid				Yield/ Rate (%)		Average Balance				Interest Earned/ Paid				Yield/ Rate (%)		Average Balance				Interest Earned/ Paid				Yield/ Rate (%)
Assets:
Other interest-earning assets				$	587,112			$	530			0.36		$	820,318			$	645			0.31		$	625,183			$	527			0.33
Securities (1)					1,260,167				9,855			3.13			1,194,711				9,559			3.20			1,113,546				9,992			3.59
Federal Home Loan Bank ("FHLB") and Federal Reserve Bank ("FRB") stock					38,926				371			3.81			38,748				369			3.81			36,209				342			3.78
Loans (1)(2)					7,013,586				76,405			4.32			6,887,611				76,328			4.40			6,545,967				73,371			4.45
	Total interest-earning assets (1)				8,899,791				87,161			3.89			8,941,388				86,901			3.86			8,320,905				84,232			4.02
Cash and due from banks					131,589										132,504										126,317
Allowance for loan and covered loan losses					(74,823	)									(73,928	)									(74,686	)
Other assets					865,873										875,668										859,633
		Total assets		$	9,822,430									$	9,875,632									$	9,232,169
Liabilities and Stockholders' Equity:
Interest-bearing core deposits (3)				$	4,471,645				930			0.08		$	4,465,956				931			0.08		$	4,144,391				984			0.09
Time deposits					1,152,895				1,341			0.46			1,173,127				1,398			0.47			1,255,355				1,479			0.47
Borrowed funds					167,120				1,250			2.97			168,807				928			2.18			111,213				12			0.04
Senior and subordinated debt					201,168				3,134			6.18			201,083				3,133			6.18			194,137				3,015			6.16
	Total interest-bearing liabilities				5,992,828				6,655			0.44			6,008,973				6,390			0.42			5,705,096				5,490			0.38
Demand deposits (3)					2,560,604										2,601,442										2,339,298
	Total funding sources				8,553,432										8,610,415										8,044,394
Other liabilities					114,492										130,250										115,093
Stockholders' equity - common					1,154,506										1,134,967										1,072,682
		Total liabilities and stockholders' equity		$	9,822,430									$	9,875,632									$	9,232,169
Tax-equivalent net interest income/margin (1)									80,506			3.59							80,511			3.58							78,742			3.76
Tax-equivalent adjustment									(2,494	)									(2,609	)									(2,923	)
		Net interest income (GAAP)						$	78,012									$	77,902									$	75,819

(1)	Interest income and yields on tax-exempt securities and loans are presented on a tax-equivalent basis, assuming a federal income tax rate of 35%. This non-GAAP financial measure assists management in comparing revenue from both taxable and tax-exempt sources. The corresponding income tax impact related to tax-exempt items is recorded in income tax expense. These adjustments have no impact on net income.
(2)	Includes loans acquired through Federal Deposit Insurance Corporation ("FDIC")-assisted transactions subject to loss sharing agreements ("covered loans") and a related FDIC indemnification asset.
(3)	See the Deposit Composition table for further average balance detail by category.

Total average interest-earning assets were relatively unchanged from the third quarter of 2015, with the increase of $126.0 million in average loans and $65.5 million in securities offset by a $233.2 million decline in lower yielding other interest-earning assets. Total average funding sources were consistent with the third quarter of 2015.

Compared to the fourth quarter of 2014, the $578.9 million increase in total average interest-earning assets and the $509.0 million rise in total average funding sources reflect loan growth over the course of the year, the full impact of the Great Lakes Financial Resources, Inc. ("Great Lakes") acquisition completed during the fourth quarter of 2014, and the Peoples Bank acquisition completed during the fourth quarter of 2015.

Tax-equivalent net interest margin for the current quarter was 3.59%, increasing one basis point from the third quarter of 2015 while decreasing 17 basis points from the fourth quarter of 2014. Compared to the third quarter of 2015, the rise in tax-equivalent net interest margin was due primarily to the reinvestment of other interest-earning assets into higher yielding loans and securities which was partially offset by lower acquired loan accretion and covered loan income and the continued shift in the loan mix to floating rate loans. Tax-equivalent net interest margin decreased compared to the fourth quarter of 2014, driven primarily by the continued shift in the loan mix and lower covered loan income.

Acquired loan accretion related to the Company's acquisitions completed in 2014 contributed $1.3 million for the fourth quarter of 2015, $1.8 million for the third quarter of 2015, and $1.4 million for the fourth quarter of 2014.

Fee-based Revenues and Total Noninterest Income Analysis
(Dollar amounts in thousands)
			Quarters Ended										December 31, 2015 Percent Change from
			December 31,  2015			September 30,  2015			December 31,  2014				September 30,  2015			December 31,  2014
Service charges on deposit accounts			$	10,303		$	10,519		$	10,015			(2.1	)		2.9
Wealth management fees				7,493			7,222			6,744			3.8			11.1
Card-based fees				6,761			6,868			6,390			(1.6	)		5.8
Merchant servicing fees (1)				2,929			3,207			2,703			(8.7	)		8.4
Mortgage banking income				1,777			1,402			812			26.7			118.8
Other service charges, commissions, and fees				4,664			3,900			2,700			19.6			72.7
	Total fee-based revenues			33,927			33,118			29,364			2.4			15.5
Other income				1,729			1,372			1,767			26.0			(2.2	)
Net securities gains (losses)				822			524			(63	)		56.9			N/M
	Total noninterest income		$	36,478		$	35,014		$	31,068			4.2			17.4

N/M - Not meaningful.
(1)	Merchant servicing fees are substantially offset by merchant card expense included in noninterest expense for each period presented.

Total fee-based revenues of $33.9 million grew by 15.5% compared to the fourth quarter of 2014 and 2.4% compared to the third quarter of 2015. The increases compared to both prior periods presented reflect continued growth in wealth management fees, mortgage banking income, and capital market and lease initiatives within other service charges, commissions, and fees.

Continued sales of fiduciary and investment advisory services to new and existing customers drove the rise in wealth management fees compared to both prior periods presented.

Mortgage banking income resulted from sales of $51.4 million of 1-4 family mortgage loans in the secondary market during the fourth quarter of 2015, compared to $42.2 million in the third quarter of 2015 and $30.2 million in the fourth quarter of 2014.

Compared to both prior periods presented, the increase in other service charges, commissions, and fees was driven by fee income generated from sales of capital market products to commercial clients and gains on sales of lease contracts. Gains on sales of lease contracts generated by First Midwest Equipment Finance, formed from an acquisition in September of 2014, totaled $687,000, $456,000, and $327,000, for the fourth and third quarters of 2015 and fourth quarter of 2014, respectively. In addition, the Company has retained leases within the loan portfolio of $104.4 million as of December 31, 2015, up from $23.0 million as of December 31, 2014.

Total noninterest income of $36.5 million grew 17.4% and 4.2% from the fourth quarter of 2014 and the third quarter of 2015, respectively.

Noninterest Expense Analysis
(Dollar amounts in thousands)
					Quarters Ended												December 31, 2015 Percent Change from
					December 31,  2015				September 30,  2015				December 31,  2014				September 30,  2015			December 31,  2014
Salaries and employee benefits:
	Salaries and wages				$	34,295			$	33,554			$	32,640			2.2			5.1
	Retirement and other employee benefits					8,925				7,807				7,660			14.3			16.5
		Total salaries and employee benefits				43,220				41,361				40,300			4.5			7.2
Net occupancy and equipment expense						9,256				9,406				9,479			(1.6	)		(2.4	)
Professional services						6,117				6,172				6,664			(0.9	)		(8.2	)
Technology and related costs						3,694				3,673				3,444			0.6			7.3
Merchant card expense (1)						2,495				2,722				2,203			(8.3	)		13.3
Advertising and promotions						2,211				1,828				2,418			21.0			(8.6	)
Cardholder expenses						1,329				1,354				1,036			(1.8	)		28.3
Net other real estate owned ("OREO") expense						926				1,290				2,544			(28.2	)		(63.6	)
Other expenses						7,525				6,559				7,446			14.7			1.1
Property valuation adjustments						8,581				--				--			N/M			N/M
Acquisition and integration related expenses						1,389				--				9,294			N/M			(85.1	)
			Total noninterest expense		$	86,743			$	74,365			$	84,828			16.6			2.3
Efficiency ratio (2)						65	%			63	%			66	%

N/M - Not meaningful.
(1)	Merchant card expenses are substantially offset by merchant servicing fees included in noninterest income for each period presented.
(2)	The efficiency ratio expresses noninterest expense, excluding OREO expense, as a percentage of tax-equivalent net interest income plus total fee-based revenues, other income, and tax-equivalent adjusted bank-owned life insurance ("BOLI") income. In addition, property valuation adjustments of $8.6 million and acquisition and integration related expenses of $1.4 million are excluded from the efficiency ratio for the fourth quarter of 2015. For the fourth quarter of 2014, acquisition and integration related expenses of $9.3 million are excluded from the efficiency ratio. See the accompanying Non-GAAP Reconciliations for details on the calculation of the efficiency ratio.

Excluding the property valuation adjustment and acquisition and integration related expenses, total noninterest expense increased by 1.6% from the fourth quarter of 2014 and 3.2% from the third quarter of 2015.

The rise in total noninterest expense compared to the fourth quarter of 2014 was due partly to operating costs of the banking locations acquired in the Great Lakes acquisition during December of 2014. These costs primarily occurred within salaries and employee benefits, net occupancy and equipment expense, and other expenses. The reduction in professional services compared to the fourth quarter of 2014 resulted primarily from lower legal and loan remediation expenses and lower costs to service the Company's covered loan portfolio.

Salaries and employee benefits and other expenses increased compared to the third quarter of 2015 due primarily to talent recruitment and organizational growth needs.

The rise in retirement and other employee benefits compared to both prior periods presented was impacted by lump sum distributions related to the Company's defined benefit retirement plan, prompted in part by an expectation of rising rates. This expense is expected to return to normalized levels in subsequent quarters.

During the fourth quarter of 2015, property valuation adjustments of $8.6 million were recognized on twelve closed branches and seven parcels of land as part of the Company's strategic branch initiatives.

LOAN PORTFOLIO AND ASSET QUALITY
Loan Portfolio Composition
(Dollar amounts in thousands)
					As of									December 31, 2015 Percent Change from
					December 31,  2015			September 30,  2015			December 31,  2014			September 30, 2015 (1)			December 31,  2014
Commercial and industrial					$	2,524,726		$	2,392,860		$	2,253,556		22.0			12.0
Agricultural						387,440			393,732			358,249		(6.4	)		8.1
Commercial real estate:
	Office					479,374			487,629			494,637		(6.8	)		(3.1	)
	Retail					434,241			432,107			452,225		2.0			(4.0	)
	Industrial					481,839			494,341			531,517		(10.1	)		(9.3	)
	Multi-family					528,324			539,308			564,421		(8.1	)		(6.4	)
	Construction					216,882			192,086			204,236		51.6			6.2
	Other commercial real estate					931,190			869,748			887,897		28.3			4.9
			Total commercial real estate			3,071,850			3,015,219			3,134,933		7.5			(2.0	)
			Total corporate loans			5,984,016			5,801,811			5,746,738		12.6			4.1
Home equity						653,468			647,223			543,185		3.9			20.3
1-4 family mortgages						355,854			294,261			291,463		83.7			22.1
Installment						137,602			131,185			76,032		19.6			81.0
		Total consumer loans				1,146,924			1,072,669			910,680		27.7			25.9
		Total loans, excluding covered loans				7,130,940			6,874,480			6,657,418		14.9			7.1
Covered loans						30,775			51,219			79,435		N/M			(61.3	)
		Total loans			$	7,161,715		$	6,925,699		$	6,736,853		13.6			6.3

N/M - Not meaningful.
(1)	Ratios are presented on an annualized basis.

Total loans, excluding covered loans, of $7.1 billion grew $256.5 million, or 14.9%, on an annualized basis from September 30, 2015 and $473.5 million, or 7.1%, from December 31, 2014. Compared to the third quarter of 2015, the increase in loans was driven primarily by strong sales production of the corporate lending teams, growth in 1-4 family mortgages, and the Peoples Bank acquisition completed in the fourth quarter of 2015, which contributed $53.9 million.

Compared to the fourth quarter of 2014, the increase in loans resulted primarily from strong sales production, growth in 1-4 family mortgages, and the expansion of the Company's web-based installment programs. The overall decline in commercial real estate loans compared to the fourth quarter of 2014 resulted from the decision of certain customers to opportunistically sell their commercial businesses and investment real estate properties or use excess liquidity to payoff long-term debt. These decreases more than offset organic commercial real estate growth.

Compared to both prior periods presented, growth in corporate loans was concentrated within our commercial and industrial loan category. The increase in commercial and industrial loans primarily reflects the continued expansion into select sector-based lending areas such as leasing, healthcare, asset-based lending, and structured finance.

Asset Quality
(Dollar amounts in thousands)
			As of												December 31, 2015 Percent Change from
			December 31,  2015				September 30,  2015				December 31,  2014				September 30,  2015			December 31,  2014
Asset quality, excluding covered loans and covered OREO
Non-accrual loans			$	28,875			$	32,308			$	59,971			(10.6	)		(51.9	)
90 days or more past due loans				2,883				4,559				1,173			(36.8	)		N/M
	Total non-performing loans			31,758				36,867				61,144			(13.9	)		(48.1	)
Accruing troubled debt restructurings ("TDRs")				2,743				2,771				3,704			(1.0	)		(25.9	)
OREO				27,349				31,129				26,898			(12.1	)		1.7
	Total non-performing assets		$	61,850			$	70,767			$	91,746			(12.6	)		(32.6	)
30-89 days past due loans			$	16,329			$	28,629			$	20,073
Non-accrual loans to total loans				0.40	%			0.47	%			0.90	%
Non-performing loans to total loans				0.45	%			0.54	%			0.92	%
Non-performing assets to total loans plus OREO				0.86	%			1.02	%			1.37	%
Allowance for Credit Losses
Allowance for loan and covered loan losses			$	73,630			$	72,500			$	72,694
Reserve for unfunded commitments				1,225				1,225				1,816
	Total allowance for credit losses		$	74,855			$	73,725			$	74,510
Allowance for credit losses to total loans (1)				1.05	%			1.06	%			1.11	%
Allowance for credit losses to non-accrual loans, excluding covered loans				253.57	%			215.45	%			112.19	%

N/M - Not meaningful.
(1)	This ratio includes acquired loans that are recorded at fair value through an acquisition adjustment, which incorporates credit risk, as of the acquisition date with no allowance for credit losses being established at that time. As the acquisition adjustment is accreted into income over future periods, an allowance for credit losses is established as necessary to reflect credit deterioration. The allowance for credit losses to total loans, excluding acquired loans, was 1.11%, 1.14%, and 1.24% at December 31, 2015, September 30, 2015, and December 31, 2014, respectively.

Asset quality continued to improve across all metrics. Total non-performing assets, excluding covered loans and covered OREO, decreased by $8.9 million, or 12.6%, from September 30, 2015 and $29.9 million, or 32.6%, from December 31, 2014. Non-performing assets to total loans plus OREO improved to 0.86% at December 31, 2015 compared to 1.02% at September 30, 2015 and 1.37% at December 31, 2014.

Charge-Off Data
(Dollar amounts in thousands)
				Quarters Ended												Years Ended
				December 31,  2015				September 30,  2015				December 31,  2014				December 31, 2015				December 31, 2014
Net loan charge-offs (1):
	Commercial and industrial			$	1,781			$	1,601			$	1,217			$	13,312			$	13,471
	Agricultural				--				--				--				--				153
	Office, retail, and industrial				267				457				143				2,420				6,848
	Multi-family				(27	)			67				476				530				856
	Construction				105				(114	)			(6	)			(214	)			886
	Other commercial real estate				110				92				(247	)			650				3,107
	Consumer				1,134				959				342				3,004				6,845
	Covered				--				1				146				514				(187	)
		Total net loan charge-offs		$	3,370			$	3,063			$	2,071			$	20,216			$	31,979
Net loan charge-offs to average loans					0.19	%			0.18	%			0.13	%			0.29	%			0.52	%

(1)	Amounts represent charge-offs, net of recoveries.

Total net loan charge-offs for the fourth quarter of 2015 were 19 basis points of average loans, or $3.4 million, consistent with the third quarter of 2015 and increasing slightly from 13 basis points for the fourth quarter of 2014.

DEPOSIT PORTFOLIO
Deposit Composition
(Dollar amounts in thousands)
				Average for Quarters Ended									December 31, 2015 Percent Change from
				December 31,  2015			September 30,  2015			December 31,  2014			September 30, 2015			December 31, 2014
Demand deposits				$	2,560,604		$	2,601,442		$	2,339,298		(1.6	)		9.5
Savings deposits					1,483,962			1,471,003			1,306,388		0.9			13.6
NOW accounts					1,411,425			1,405,371			1,331,360		0.4			6.0
Money market accounts					1,576,258			1,589,582			1,506,643		(0.8	)		4.6
	Core deposits				7,032,249			7,067,398			6,483,689		(0.5	)		8.5
Time deposits and other					1,152,895			1,173,127			1,255,355		(1.7	)		(8.2	)
		Total deposits		$	8,185,144		$	8,240,525		$	7,739,044		(0.7	)		5.8

Average core deposits of $7.0 billion for the fourth quarter of 2015 were consistent with the third quarter of 2015 and increased 8.5% compared to the fourth quarter of 2014. Compared to the third quarter of 2015, a normal seasonal decrease in average municipal deposits was offset by growth in commercial deposits and the one-month impact of $92.0 million in deposits assumed in the December of 2015 Peoples Bank acquisition. The rise in average core deposits compared to the fourth quarter of 2014 resulted from growth and the full quarter impact of deposits assumed in the December of 2014 Great Lakes acquisition, which further strengthened the Company's core deposit base.

CAPITAL MANAGEMENT
Capital Ratios
			As of
			December 31,  2015			September 30,  2015			June 30,  2015			December 31,  2014
Company regulatory capital ratios (1):
	Total capital to risk-weighted assets		11.15	%		11.43	%		11.37	%		11.23	%
	Tier 1 capital to risk-weighted assets		10.28	%		10.55	%		10.49	%		10.18	%
	Tier 1 common capital to risk-weighted assets		9.73	%		10.00	%		9.93	%		N/A
	Tier 1 leverage to average assets		9.40	%		9.29	%		9.34	%		9.03	%
Company tangible common equity ratios (2)(3):
	Tangible common equity to tangible assets		8.59	%		8.50	%		8.32	%		8.41	%
	Tangible common equity, excluding other comprehensive loss,to tangible assets		8.89	%		8.67	%		8.54	%		8.59	%
	Tangible common equity to risk-weighted assets		9.29	%		9.70	%		9.55	%		9.73	%

N/A - Not applicable.
(1)	Basel III Capital Rules became effective for the Company on January 1, 2015. These rules revise the risk-based capital requirements and introduce a new capital measure, Tier 1 common capital to risk-weighted assets. As a result, ratios subsequent to December 31, 2014 are computed using the new rules and prior periods presented are reported using the regulatory guidance applicable at that time.
(2)	Ratio is not subject to formal Federal Reserve regulatory guidance.
(3)	Tangible common equity ("TCE") represents common stockholders' equity less goodwill and identifiable intangible assets. In management's view, Tier 1 common capital and TCE measures are meaningful to the Company, as well as analysts and investors, in assessing the Company's use of equity and in facilitating comparisons with competitors. See the accompanying Non-GAAP Reconciliations for details of the calculation of these ratios.

Compared to September 30, 2015, the declines in the Company's regulatory capital ratios tied to end-of-period risk-weighted assets reflect the impact of the increase in assets late in the fourth quarter of 2015, including those acquired from the Peoples Bank acquisition.

The Board of Directors approved a quarterly cash dividend of $0.09 per common share during the fourth quarter of 2015, which is consistent with the third quarter of 2015 and follows a dividend increase from $0.08 to $0.09 per common share during the first quarter of 2015.

Conference Call

A conference call to discuss the Company's results, outlook, and related matters will be held on Wednesday, January 27, 2016 at 10:00 A.M. (ET). Members of the public who would like to listen to the conference call should dial (877) 507-0639 (U.S. domestic) or (412) 317-6003 (International) and ask for the First Midwest Bancorp, Inc. Earnings Conference Call. The number should be dialed 10 to 15 minutes prior to the start of the conference call. There is no charge to access the call. The conference call will also be accessible as an audio webcast through the Investor Relations section of the Company's website, www.firstmidwest.com/investorrelations. For those unable to listen to the live broadcast, a replay will be available on the Company's website or by dialing (877) 344-7529 (U.S. domestic) or (412) 317-0088 (International) conference I.D. 10078820 beginning one hour after completion of the live call until 9:00 A.M. (ET) on February 4, 2016. Please direct any questions regarding obtaining access to the conference call to First Midwest Bancorp, Inc. Investor Relations, via e-mail, at investor.relations@firstmidwest.com.

Press Release and Additional Information Available on Website

This press release and the accompanying unaudited Selected Financial Information are available through the "Investor Relations" section of First Midwest's website at www.firstmidwest.com/investorrelations.

Forward-Looking Statements

This press release may contain certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. In some cases, forward-looking statements can be identified by the use of words such as "may," "might," "will," "would," "should," "could," "expect," "plan," "intend," "anticipate," "believe," "estimate," "predict," "probable," "potential," "possible," "target," "continue," "look forward," or "assume" and words of similar import. Forward-looking statements are not historical facts but instead express only management's beliefs regarding future results or events, many of which, by their nature, are inherently uncertain and outside of management's control. It is possible that actual results and events may differ, possibly materially, from the anticipated results or events indicated in these forward-looking statements. Forward-looking statements are not guarantees of future performance, and we caution you not to place undue reliance on these statements. Forward-looking statements are made only as of the date of this press release, and we undertake no obligation to update any forward-looking statements contained in this press release to reflect new information or events or conditions after the date hereof.

Forward-looking statements may be deemed to include, among other things, statements relating to our future financial performance, the performance of our loan or securities portfolio, the expected amount of future credit reserves or charge-offs, corporate strategies or objectives, anticipated trends in our business, regulatory developments, acquisition transactions, including estimated synergies, cost savings and financial benefits of pending or consummated transactions, including First Midwest's proposed acquisition of NI Bancshares Corporation ("NI Bancshares"), and growth strategies, including possible future acquisitions. These statements are subject to certain risks, uncertainties and assumptions. For a discussion of these risks, uncertainties and assumptions, you should refer to the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K for the year ended December 31, 2014, as well as our subsequent filings made with the Securities and Exchange Commission ("SEC"). However, these risks and uncertainties are not exhaustive. Other sections of such reports describe additional factors that could adversely impact our business and financial performance.

Additional Information for Stockholders

The information contained herein does not constitute an offer to sell or a solicitation of an offer to buy any securities or a solicitation of any vote or approval. In connection with the proposed merger of First Midwest and NI Bancshares, First Midwest has filed a registration statement on Form S-4 (File no. 333-208781) with the SEC. The registration statement includes a proxy statement of NI Bancshares, which also constitutes a prospectus of First Midwest, that will be sent to the stockholders of NI Bancshares. Stockholders are advised to read the registration statement and proxy statement/prospectus because it contains important information about First Midwest, NI Bancshares and the proposed transaction. This document and other documents relating to the transaction filed by First Midwest can be obtained free of charge from the SEC's website at www.sec.gov. These documents also can be obtained free of charge by accessing First Midwest's website at www.firstmidwest.com under the tab "Investor Relations" and then under "SEC Filings." Alternatively, these documents can be obtained free of charge from First Midwest upon written request to First Midwest Bancorp, Inc., Attn: Corporate Secretary, One Pierce Place, Suite 1500, Itasca, Illinois 60143 or by calling (630) 875-7463, or from NI Bancshares upon written request to NI Bancshares Corporation, Attn: Michael A. Cullen, President and Chief Executive Officer, 230 W. State Street, Sycamore, Illinois 60178 or by calling (815) 895-2125.

Participants in this Transaction

First Midwest, NI Bancshares, and certain of their respective directors and executive officers may be deemed to be participants in the solicitation of proxies from NI Bancshares stockholders in connection with the proposed transaction between First Midwest and NI Bancshares under the rules of the SEC. Certain information regarding the interests of these participants and a description of their direct and indirect interests, by security holdings or otherwise, is included in the proxy statement/prospectus regarding the proposed transaction. Additional information about First Midwest and its directors and certain of its officers may be found in First Midwest's definitive proxy statement relating to its 2015 Annual Meeting of Stockholders filed with the SEC on April 14, 2015. This definitive proxy statement can be obtained free of charge from the SEC's website at www.sec.gov.

Non-GAAP Financial Information

The Company's accounting and reporting policies conform to U.S. generally accepted accounting principles ("GAAP") and general practice 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. 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. See the following reconciliations for details on the calculation of these measures to the extent presented herein.

About the Company

First Midwest is a relationship-focused financial institution and one of Illinois' largest independent publicly-traded bank holding companies. First Midwest's principal subsidiary, First Midwest Bank, and other affiliates provide a full range of business, middle market and retail banking as well as wealth management and private banking services through over 100 locations in metropolitan Chicago, northwest Indiana, central and western Illinois, and eastern Iowa. First Midwest was recognized as having the "Highest Customer Satisfaction with Retail Banking in the Midwest, Two Years in a Row"* according to the J.D. Power 2014 and 2015 Retail Banking Satisfaction Studies(SM). First Midwest's website is www.firstmidwest.com.

* First Midwest Bank received the highest numerical score among retail banks in the Midwest region in the proprietary J.D. Power 2014 and 2015 Retail Banking Satisfaction Studies(SM). The 2015 study is based on 82,030 total responses measuring 20 providers in the Midwest region (IA, IL, KS, MO, MN, WI) and measures opinions of consumers with their primary banking provider. Proprietary study results are based on experiences and perceptions of consumers surveyed April 2014 - February 2015. Your experiences may vary. Visit jdpower.com.

Accompanying Unaudited Selected Financial Information

Consolidated Statements of Financial Condition (Unaudited) (Dollar amounts in thousands)
				As of
				December 31,				September 30,				June 30,				March 31,				December 31,
				2015				2015				2015				2015				2014
Period-End Balance Sheet
Assets
Cash and due from banks				$	114,587			$	125,279			$	135,546			$	126,450			$	117,315
Interest-bearing deposits in other banks					266,615				822,264				811,287				492,607				488,947
Trading securities, at fair value					16,894				17,038				18,172				18,374				17,460
Securities available-for-sale, at fair value					1,306,636				1,151,418				1,142,407				1,151,603				1,187,009
Securities held-to-maturity, at amortized cost					23,152				23,723				24,292				25,861				26,555
FHLB and FRB stock					39,306				38,748				38,748				38,748				37,558
Loans, excluding covered loans:
	Commercial and industrial				2,524,726				2,392,860				2,366,056				2,318,058				2,253,556
	Agricultural				387,440				393,732				377,410				368,836				358,249
	Commercial real estate:
		Office, retail, and industrial			1,395,454				1,414,077				1,432,502				1,443,562				1,478,379
		Multi-family			528,324				539,308				557,947				560,800				564,421
		Construction			216,882				192,086				190,970				191,104				204,236
		Other commercial real estate			931,190				869,748				871,119				881,026				887,897
	Home equity				653,468				647,223				599,320				599,543				543,185
	1-4 family mortgages				355,854				294,261				283,562				285,758				291,463
	Installment				137,602				131,185				113,382				92,834				76,032
		Total loans, excluding covered loans			7,130,940				6,874,480				6,792,268				6,741,521				6,657,418
Covered loans					30,775				51,219				57,917				62,830				79,435
Allowance for loan and covered loan losses					(73,630	)			(72,500	)			(71,463	)			(70,990	)			(72,694	)
	Net loans				7,088,085				6,853,199				6,778,722				6,733,361				6,664,159
OREO, excluding covered OREO					27,349				31,129				24,471				26,042				26,898
Covered OREO					433				906				3,759				7,309				8,068
FDIC indemnification asset					3,903				6,106				7,335				8,540				8,452
Premises, furniture, and equipment, net					122,278				127,443				128,621				128,698				131,109
Investment in BOLI					209,601				208,666				207,814				207,190				206,498
Goodwill and other intangible assets					339,277				331,250				332,223				333,202				334,199
Accrued interest receivable and other assets					174,560				197,877				209,630				200,611				190,912
	Total assets			$	9,732,676			$	9,935,046			$	9,863,027			$	9,498,596			$	9,445,139
Liabilities and Stockholders' Equity
Noninterest-bearing deposits				$	2,414,454			$	2,671,793			$	2,508,316			$	2,339,492			$	2,301,757
Interest-bearing deposits					5,683,284				5,624,657				5,704,355				5,575,187				5,586,001
	Total deposits				8,097,738				8,296,450				8,212,671				7,914,679				7,887,758
Borrowed funds					165,096				169,943				189,036				131,200				137,994
Senior and subordinated debt					201,208				201,123				201,039				200,954				200,869
Accrued interest payable and other liabilities					122,366				119,861				135,324				135,813				117,743
Stockholders' equity					1,146,268				1,147,669				1,124,957				1,115,950				1,100,775
	Total liabilities and stockholders' equity			$	9,732,676			$	9,935,046			$	9,863,027			$	9,498,596			$	9,445,139
Stockholders' equity, excluding accumulated other comprehensive income ("AOCI")				$	1,174,657			$	1,163,487			$	1,146,189			$	1,128,755			$	1,116,630
Stockholders' equity, common					1,146,268				1,147,669				1,124,957				1,115,950				1,100,775

Condensed Consolidated Statements of Income (Unaudited) (Dollar amounts in thousands)

					Quarters Ended																Years Ended
					December 31,			September 30,			June 30,			March 31,			December 31,				December 31,			December 31,
					2015			2015			2015			2015			2014				2015			2014
Income Statement
Interest income					$	84,667		$	84,292		$	84,556		$	82,469		$	81,309			$	335,984		$	299,864
Interest expense						6,655			6,390			5,654			5,687			5,490				24,386			23,012
	Net interest income					78,012			77,902			78,902			76,782			75,819				311,598			276,852
Provision for loan and covered loan losses						4,500			4,100			6,000			6,552			1,659				21,152			19,168
			Net interest income after provision for loan and covered loan losses			73,512			73,802			72,902			70,230			74,160				290,446			257,684
Noninterest Income
		Service charges on deposit accounts				10,303			10,519			9,886			9,271			10,015				39,979			36,910
		Wealth management fees				7,493			7,222			7,433			7,014			6,744				29,162			26,474
		Card-based fees				6,761			6,868			6,953			6,402			6,390				26,984			24,340
		Merchant servicing fees				2,929			3,207			2,938			2,665			2,703				11,739			11,260
		Mortgage banking income				1,777			1,402			1,439			1,123			812				5,741			4,011
		Other service charges, commissions, and fees				4,664			3,900			2,924			2,166			2,700				13,654			8,086
			Total fee-based revenues			33,927			33,118			31,573			28,641			29,364				127,259			111,081
		Other income				1,437			1,372			1,900			1,948			1,767				6,657			5,545
		Net securities gains (losses)				822			524			515			512			(63	)			2,373			8,097
		Gains on sales of properties				292			-			-			-			-				292			3,954
		Loss on early extinguishment of debt				-			-			-			-			-				-			(2,059	)
			Total noninterest income			36,478			35,014			33,988			31,101			31,068				136,581			126,618
Noninterest Expense
	Salaries and employee benefits:
		Salaries and wages				34,295			33,554			33,096			32,794			32,640				133,739			116,578
		Retirement and other employee benefits				8,925			7,807			7,198			7,922			7,660				31,852			27,245
			Total salaries and employee benefits			43,220			41,361			40,294			40,716			40,300				165,591			143,823
		Net occupancy and equipment expense				9,256			9,406			9,622			10,436			9,479				38,720			35,181
		Professional services				6,117			6,172			5,322			5,109			6,664				22,720			23,436
		Technology and related costs				3,694			3,673			3,527			3,687			3,444				14,581			12,875
		Merchant card expense				2,495			2,722			2,472			2,197			2,203				9,886			9,195
		Advertising and promotions				2,211			1,828			2,344			1,223			2,418				7,606			8,159
		Cardholder expenses				1,329			1,354			1,292			1,268			1,036				5,243			4,251
		Net OREO expense				926			1,290			1,861			1,204			2,544				5,281			7,075
		Other expenses				7,525			6,559			6,717			6,817			7,446				27,618			33,034
		Property valuation adjustments				8,581			-			-			-			-				8,581			-
		Acquisition and integration related expense				1,389			-			-			-			9,294				1,389			13,872
			Total noninterest expense			86,743			74,365			73,451			72,657			84,828				307,216			283,826
		Income before income tax expense				23,247			34,451			33,439			28,674			20,400				119,811			100,476
		Income tax expense				6,923			11,167			10,865			8,792			5,807				37,747			31,170
			Net income		$	16,324		$	23,284		$	22,574		$	19,882		$	14,593			$	82,064		$	69,306
Net income applicable to common shares					$	16,145		$	23,058		$	22,325		$	19,654		$	14,454			$	81,182		$	68,470
Net income applicable to common shares, excluding certain significant transactions (1)					$	22,127		$	23,058		$	22,325		$	19,654		$	20,030			$	87,164		$	54,598

Footnotes to Condensed Consolidated Statements of Income
(1)	Certain significant transactions include property valuation adjustments related to strategic branch initiatives and acquisition and integration related expenses associated with completed and pending acquisitions.

Selected Financial Information (Unaudited) (Amounts in thousands, except per share data)

		As of or for the
		Quarters Ended																				Years Ended
		December 31,				September 30,				June 30,				March 31,				December 31,				December 31,				December 31,
		2015				2015				2015				2015				2014				2015				2014
Earnings Per Share
Basic earnings per common share ("EPS") (1)		$	0.21			$	0.30			$	0.29			$	0.26			$	0.19			$	1.05			$	0.92
Diluted EPS (1)		$	0.21			$	0.30			$	0.29			$	0.26			$	0.19			$	1.05			$	0.92
Diluted EPS, excluding certain significant transactions (1)(7)		$	0.29			$	0.30			$	0.29			$	0.26			$	0.27			$	1.13			$	1.03
Common Stock and Related Per Common Share Data
Book value		$	14.70			$	14.72			$	14.43			$	14.31			$	14.17			$	14.70			$	14.17
Tangible book value			10.35				10.47				10.17				10.04				9.87				10.35				9.87
Dividends declared per share			0.09				0.09				0.09				0.09				0.08				0.36				0.31
Closing price at period end			18.43				17.54				18.97				17.37				17.11				18.43				17.11
Closing price to book value			1.3				1.2				1.3				1.2				1.2				1.3				1.2
Period end shares outstanding			77,952				77,942				77,961				77,957				77,695				77,952				77,695
Period end treasury shares			10,276				10,286				10,267				10,271				10,533				10,276				10,533
Common dividends		$	7,017			$	7,014			$	7,022			$	7,011			$	6,206			$	28,064			$	23,530
Key Ratios/Data
Return on average common equity (1)(2)			5.55	%			8.06	%			7.97	%			7.15	%			5.35	%			7.17	%			6.56	%
Return on average tangible common equity (1)(2)			8.06	%			11.68	%			11.62	%			10.52	%			7.89	%			10.44	%			9.32	%
Return on average tangible common equity, excluding certain significant transactions (1)(2)(7)			10.94	%			11.68	%			11.62	%			10.52	%			10.83	%			11.19	%			10.42	%
Return on average assets (2)			0.66	%			0.94	%			0.94	%			0.85	%			0.63	%			0.85	%			0.80	%
Efficiency ratio (1)			65.11	%			63.20	%			61.70	%			64.46	%			66.09	%			63.61	%			64.57	%
Net interest margin (3)			3.59	%			3.58	%			3.76	%			3.79	%			3.76	%			3.68	%			3.69	%
Loans-to-deposits			88.44	%			83.48	%			83.41	%			85.97	%			85.41	%			88.44	%			85.41	%
Yield on average interest-earning assets (3)			3.89	%			3.86	%			4.02	%			4.06	%			4.02	%			3.95	%			3.98	%
Cost of funds			0.44	%			0.42	%			0.38	%			0.39	%			0.38	%			0.41	%			0.43	%
Net noninterest expense to average assets			2.08	%			1.60	%			1.66	%			1.80	%			2.31	%			1.79	%			1.93	%
Effective income tax rate			29.78	%			32.41	%			32.50	%			30.66	%			28.47	%			31.51	%			31.02	%
Capital Ratios
Total capital to risk-weighted assets (1)			11.15	%			11.43	%			11.37	%			11.23	%			11.23	%			11.15	%			11.23	%
Tier 1 capital to risk-weighted assets (1)			10.28	%			10.55	%			10.49	%			10.35	%			10.19	%			10.28	%			10.19	%
Tier 1 common capital to risk- weighted assets (CET1) (1)(4)			9.73	%			10.00	%			9.93	%			9.79	%			N/A				9.73	%			N/A
Tier 1 leverage to average assets (1)			9.40	%			9.29	%			9.34	%			9.32	%			9.03	%			9.40	%			9.03	%
Tangible common equity to tangible assets (1)			8.59	%			8.50	%			8.32	%			8.54	%			8.41	%			8.59	%			8.41	%
Tangible common equity, excluding AOCI, to tangible assets (1)			8.89	%			8.67	%			8.54	%			8.68	%			8.59	%			8.89	%			8.59	%
Tangible common equity to risk- weighted assets (1)			9.29	%			9.70	%			9.55	%			9.51	%			9.73	%			9.29	%			9.73	%
Note: Selected Financial Information footnotes are located at the end of this section.

Selected Financial Information (Unaudited)

(Amounts in thousands, except per share data)

				As of or for the
				Quarters Ended																					Years Ended
				December 31,				September 30,				June 30,				March 31,				December 31,					December 31,				December 31,
				2015				2015				2015				2015				2014					2015				2014
Asset Quality Performance Data
Non-performing assets(5)
Commercial and industrial				$	5,587			$	6,438			$	11,100			$	12,913			$	22,693				$	5,587			$	22,693
Agricultural					355				112				317				358				360					355				360
Commercial real estate:
	Office, retail, and industrial				6,875				6,961				12,599				11,363				12,939					6,875				12,939
	Multi-family				796				1,046				1,287				700				754					796				754
	Construction				905				3,332				4,940				7,488				6,981					905				6,981
	Other commercial real estate				5,611				5,898				5,513				5,915				6,970					5,611				6,970
Consumer					8,746				8,521				9,253				9,340				9,274					8,746				9,274
	Total non-accrual loans				28,875				32,308				45,009				48,077				59,971					28,875				59,971
90 days or more past due loans					2,883				4,559				2,744				3,564				1,173					2,883				1,173
	Total non-performing loans				31,758				36,867				47,753				51,641				61,144					31,758				61,144
Accruing troubled debt restructurings					2,743				2,771				3,067				3,581				3,704					2,743				3,704
Other real estate owned					27,349				31,129				24,471				26,042				26,898					27,349				26,898
Total non-performing assets				$	61,850			$	70,767			$	75,291			$	81,264			$	91,746				$	61,850			$	91,746
30-89 days past due loans (5)				$	16,329			$	28,629			$	28,625			$	18,631			$	20,073				$	16,329			$	20,073
Allowance for credit losses
Allowance for loan losses				$	71,992			$	68,384			$	66,602			$	65,311			$	65,468				$	71,992			$	65,468
Allowance for covered loan losses					1,638				4,116				4,861				5,679				7,226					1,638				7,226
Reserve for unfunded commitments					1,225				1,225				1,816				1,816				1,816					1,225				1,816
Total allowance for credit losses				$	74,855			$	73,725			$	73,279			$	72,806			$	74,510				$	74,855			$	74,510
Provision for loan and covered loan losses				$	4,500			$	4,100			$	6,000			$	6,552			$	1,659				$	21,152			$	19,168
Net charge-offs by category
Commercial and industrial				$	1,781			$	1,601			$	3,273			$	6,657			$	1,217				$	13,312			$	13,471
Agricultural					-				-				-				-				-					-				153
Commercial real estate:
	Office, retail, and industrial				267				457				1,862				(166	)			143					2,420				6,848
	Multi-family				(27	)			67				466				24				476					530				856
	Construction				105				(114	)			(188	)			(17	)			(6	)				(214	)			886
	Other commercial real estate				110				92				(603	)			1,051				(247	)				650				3,107
Consumer					1,134				959				432				479				342					3,004				6,845
	Net charge-offs, excluding covered loans				3,370				3,062				5,242				8,028				1,925					19,702				32,166
Charge-offs on covered loans					-				1				285				228				146					514				(187	)
		Total net charge-offs		$	3,370			$	3,063			$	5,527			$	8,256			$	2,071				$	20,216			$	31,979
Total recoveries included above				$	1,031			$	1,294			$	2,579			$	1,797			$	2,669				$	6,701			$	8,205

Note: Selected Financial Information footnotes are located at the end of this section.

Selected Financial Information (Unaudited)

(Amounts in thousands, except per share data)

		As of or for the
		Quarters Ended															Years Ended
		December 31,			September 30,			June 30,			March 31,			December 31,			December 31,			December 31,
		2015			2015			2015			2015			2014			2015			2014
Asset Quality ratios(5)
Non-accrual loans to total loans		0.40	%		0.47	%		0.66	%		0.71	%		0.90	%		0.40	%		0.90	%
Non-performing loans to total loans		0.45	%		0.54	%		0.70	%		0.77	%		0.92	%		0.45	%		0.92	%
Non-performing assets to total loans plus OREO		0.86	%		1.02	%		1.10	%		1.20	%		1.37	%		0.86	%		1.37	%
Non-performing assets to tangible common equity plus allowance for credit losses		7.03	%		7.99	%		8.74	%		9.56	%		11.00	%		7.03	%		11.00	%
Non-accrual loans to total assets		0.30	%		0.33	%		0.46	%		0.51	%		0.64	%		0.30	%		0.64	%
Allowance for credit losses and net charge-off ratios
Allowance for credit losses to total loans (6)		1.05	%		1.06	%		1.07	%		1.07	%		1.11	%		1.05	%		1.11	%
Allowance for credit losses to loans, excluding acquired loans		1.11	%		1.14	%		1.16	%		1.19	%		1.24	%		1.11	%		1.24	%
Allowance for credit losses to non-accrual loans (5)		253.57	%		215.45	%		152.01	%		139.62	%		112.19	%		253.57	%		112.19	%
Allowance for credit losses to non-performing loans (5)		230.55	%		188.81	%		143.27	%		129.99	%		110.04	%		230.55	%		110.04	%
Net charge-offs to average loans (2)		0.19	%		0.18	%		0.33	%		0.50	%		0.13	%		0.29	%		0.52	%

Footnotes to Selected Financial Information
(1)		See the Non-GAAP Reconciliations section for the detailed calculation.
(2)		Annualized based on the actual number of days for each period presented.
(3)		Tax equivalent basis reflects federal and state tax benefits.
(4)		Basel III Capital Rules became effective for the Company on January 1, 2015. These rules revise the risk-based capital requirements and introduce a new capital measure, Tier 1 common capital to risk weighted assets. As a result, ratios subsequent to December 31, 2014 are computed using the new rules and prior periods presented are reported using the regulatory guidance applicable at that time.
(5)		Excludes covered loans and covered OREO.
(6)		This ratio includes acquired loans that are recorded at fair value through an acquisition adjustment, which incorporates credit risk, as of the acquisition date with no allowance for credit losses being established at that time. As the acquisition adjustment is accreted into income over future periods, an allowance for credit losses is established as necessary to reflect credit deterioration.
(7)		Certain significant transactions include property valuation adjustments related to strategic branch initiatives and acquisition and integration related expenses associated with completed and pending acquisitions.

Non-GAAP Reconciliations (Unaudited)

(Amounts in thousands, except per share data)

				Quarters Ended																					Years Ended
				December 31,				September 30,				June 30,				March 31,				December 31,					December 31,				December 31,
				2015				2015				2015				2015				2014					2015				2014
Earnings Per Share
Net income				$	16,324			$	23,284			$	22,574			$	19,882			$	14,593				$	82,064			$	69,306
Net income applicable to non- vested restricted shares					(179	)			(226	)			(249	)			(228	)			(139	)				(882	)			(836	)
	Net income applicable to common shares				16,145				23,058				22,325				19,654				14,454					81,182				68,470
Tax-equivalent property valuation adjustments					5,149				-				-				-				-					5,149				-
Tax-equivalent acquisition and integration related expenses					833				-				-				-				5,576					833				8,323
	Net income applicable to common shares, excluding certain significant transactions (1)			$	22,127			$	23,058			$	22,325			$	19,654			$	20,030				$	87,164			$	76,793
Weighted-average common shares outstanding:
	Weighted-average common shares outstanding (basic)				77,121				77,106				77,089				76,918				75,119					77,059				74,484
	Dilutive effect of common stock equivalents				13				13				12				12				12					13				12
		Weighted-average diluted common shares outstanding			77,134				77,119				77,101				76,930				75,131					77,072				74,496
Basic EPS				$	0.21			$	0.30			$	0.29			$	0.26			$	0.19				$	1.05			$	0.92
Diluted EPS				$	0.21			$	0.30			$	0.29			$	0.26			$	0.19				$	1.05			$	0.92
Diluted EPS, excluding certain significant transactions (1)				$	0.29			$	0.30			$	0.29			$	0.26			$	0.27				$	1.13			$	1.03
Anti-dilutive shares not included in the computation of diluted EPS					735				751				768				948				1,146					800				1,198
Efficiency Ratio Calculation
Noninterest expense				$	86,743			$	74,365			$	73,451			$	72,657			$	84,828				$	307,216			$	283,826
Less:
	Net OREO expense				(926	)			(1,290	)			(1,861	)			(1,204	)			(2,544	)				(5,281	)			(7,075	)
	Property valuation adjustments				(8,581	)			-				-				-				-					(8,581	)			-
	Acquisition and integration related expenses				(1,389	)			-				-				-				(9,294	)				(1,389	)			(13,872	)
		Total		$	75,847			$	73,075			$	71,590			$	71,453			$	72,990				$	291,965			$	262,879
Tax-equivalent net interest income (2)				$	80,506			$	80,511			$	81,595			$	79,665			$	78,742				$	322,277			$	288,589
Fee-based revenues					33,927				33,118				31,573				28,641				29,364					127,259				111,081
Add:
	Other income, excluding BOLI income				515				446				446				1,065				924					2,472				2,672
	Tax-adjusted BOLI (BOLI/.6)				1,537				1,543				2,423				1,472				1,405					6,975				4,788
		Total		$	116,485			$	115,618			$	116,037			$	110,843			$	110,435				$	458,983			$	407,130
Efficiency ratio					65.11	%			63.20	%			61.70	%			64.46	%			66.09	%				63.61	%			64.57	%
Tax Equivalent Net Interest Income
Net interest income				$	78,012			$	77,902			$	78,902			$	76,782			$	75,819				$	311,598			$	276,852
Tax-equivalent adjustment					2,494				2,609				2,693				2,883				2,923					10,679				11,737
	Tax-equivalent net interest income (2)			$	80,506			$	80,511			$	81,595			$	79,665			$	78,742				$	322,277			$	288,589

Note: Non-GAAP Reconciliations footnotes are located at the end of this section.

Non-GAAP Reconciliations (Unaudited)

(Amounts in thousands, except per share data)

			As of or for the
			Quarters Ended																					Years Ended
			December 31,				September 30,				June 30,				March 31,				December 31,					December 31,				December 31,
			2015				2015				2015				2015				2014					2015				2014
Risk-Based Capital Data (3)
Common stock			$	882			$	882			$	882			$	882			$	882				$	882			$	882
Additional paid-in capital				446,672				445,037				443,558				441,689				449,798					446,672				449,798
Retained earnings				953,516				944,209				927,939				912,387				899,516					953,516				899,516
Treasury stock, at cost				(226,413	)			(226,641	)			(226,190	)			(226,203	)			(233,566	)				(226,413	)			(233,566	)
Goodwill and other intangible assets				(327,115	)			(318,854	)			(319,243	)			(319,635	)			(334,199	)				(327,115	)			(334,199	)
Disallowed deferred tax assets (CET1) (3)				(1,888	)			(2,889	)			(3,046	)			(3,354	)			(30,638	)				(1,888	)			(30,638	)
	Common equity Tier 1 capital			845,654				841,744				823,900				805,766				751,793					845,654				751,793
Trust preferred securities				50,690				50,690				50,690				50,690				50,690					50,690				50,690
Disallowed deferred tax assets (other) (3)				(2,868	)			(4,334	)			(4,568	)			(5,030	)			N/A					(2,868	)			N/A
	Tier 1 capital			893,476				888,100				870,022				851,426				802,483					893,476				802,483
Tier 2 capital				74,855				73,725				73,279				72,806				82,209					74,855				82,209
	Total capital		$	968,331			$	961,825			$	943,301			$	924,232			$	884,692				$	968,331			$	884,692
Risk-weighted assets			$	8,687,864			$	8,414,729			$	8,296,679			$	8,229,627			$	7,876,754				$	8,687,864			$	7,876,754
Adjusted average assets			$	9,501,087			$	9,559,796			$	9,318,347			$	9,134,320			$	8,884,045				$	9,501,087			$	8,884,045
Total capital to risk-weighted assets				11.15	%			11.43	%			11.37	%			11.23	%			11.23	%				11.15	%			11.23	%
Tier 1 capital to risk-weighted assets				10.28	%			10.55	%			10.49	%			10.35	%			10.19	%				10.28	%			10.19	%
Tier 1 common capital to risk- weighted assets (CET1) (3)				9.73	%			10.00	%			9.93	%			9.79	%			N/A					9.73	%			N/A
Tier 1 leverage to average assets				9.40	%			9.29	%			9.34	%			9.32	%			9.03	%				9.40	%			9.03	%
Tangible Common Equity
Stockholders' equity			$	1,146,268			$	1,147,669			$	1,124,957			$	1,115,950			$	1,100,775				$	1,146,268			$	1,100,775
Less: goodwill and other intangible assets				(339,277	)			(331,250	)			(332,223	)			(333,202	)			(334,199	)				(339,277	)			(334,199	)
	Tangible common equity			806,991				816,419				792,734				782,748				766,576					806,991				766,576
Less: AOCI				28,389				15,818				21,232				12,805				15,855					28,389				15,855
	Tangible common equity, excluding AOCI		$	835,380			$	832,237			$	813,966			$	795,553			$	782,431				$	835,380			$	782,431
Total assets			$	9,732,676			$	9,935,046			$	9,863,027			$	9,498,596			$	9,445,139				$	9,732,676			$	9,445,139
Less: goodwill and other intangible assets				(339,277	)			(331,250	)			(332,223	)			(333,202	)			(334,199	)				(339,277	)			(334,199	)
	Tangible assets		$	9,393,399			$	9,603,796			$	9,530,804			$	9,165,394			$	9,110,940				$	9,393,399			$	9,110,940
Tangible common equity to tangible assets				8.59	%			8.50	%			8.32	%			8.54	%			8.41	%				8.59	%			8.41	%
Tangible common equity, excluding AOCI, to tangible assets				8.89	%			8.67	%			8.54	%			8.68	%			8.59	%				8.89	%			8.59	%
Tangible common equity to risk- weighted assets				9.29	%			9.70	%			9.55	%			9.51	%			9.73	%				9.29	%			9.73	%

Note: Non-GAAP Reconciliations footnotes are located at the end of this section.

Non-GAAP Reconciliations (Unaudited)

(Amounts in thousands, except per share data)

			As of or for the
			Quarters Ended																					Years Ended
			December 31,				September 30,				June 30,				March 31,				December 31,					December 31,				December 31,
			2015				2015				2015				2015				2014					2015				2014
Return on Average Common and Tangible Common Equity
Net income applicable to common shares			$	16,145			$	23,058			$	22,325			$	19,654			$	14,454				$	81,182			$	68,470
Intangibles amortization				971				973				978				998				842					3,920				2,889
Tax-equivalent adjustment of intangibles amortization				(388	)			(389	)			(391	)			(399	)			(337	)				(1,568	)			(1,156	)
	Net income applicable to common shares, excluding intangibles amortization			16,728				23,642				22,912				20,253				14,959					83,534				70,203
Tax-equivalent property valuation adjustments (2)				5,149				-				-				-				-					5,149				-
Tax-equivalent acquisition and integration related expenses (2)				833				-				-				-				5,576					833				8,323
	Net income applicable to common shares, excluding certain significant transactions (1)		$	22,710			$	23,642			$	22,912			$	20,253			$	20,535				$	89,516			$	78,526
Average stockholders' equity			$	1,154,506			$	1,134,967			$	1,123,530			$	1,114,762			$	1,072,682				$	1,132,058			$	1,043,566
Less: average intangible assets				(331,013	)			(331,720	)			(332,694	)			(333,684	)			(320,533	)				(332,269	)			(290,303	)
	Average tangible common equity		$	823,493			$	803,247			$	790,836			$	781,078			$	752,149				$	799,789			$	753,263
Return on average common equity (4)				5.55	%			8.06	%			7.97	%			7.15	%			5.35	%				7.17	%			6.56	%
Return on average tangible common equity (4)				8.06	%			11.68	%			11.62	%			10.52	%			7.89	%				10.44	%			9.32	%
Return on average tangible common equity, excluding certain significant transactions (1)(4)				10.94	%			11.68	%			11.62	%			10.52	%			10.83	%				11.19	%			10.42	%

Footnotes to Non-GAAP Reconciliations
(1)		Certain significant transactions include property valuation adjustments related to strategic branch initiatives and acquisition and integration related expenses associated with completed and pending acquisitions.
(2)		Tax equivalent basis reflects federal and state tax benefits.
(3)		Basel III Capital Rules became effective for the Company on January 1, 2015. These rules revise the risk-based capital requirements and introduce a new capital measure, Tier 1 common capital to risk-weighted assets. As a result, ratios subsequent to December 31, 2014 are computed using the new rules and prior periods presented are reported using the regulatory guidance applicable at that time.
(4)		Annualized based on the actual number of days for each period presented.