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Wintrust Financial Corporation Reports Fourth Quarter and Full Year 2015 Net Income

ROSEMONT, Ill., Jan. 19, 2016 (GLOBE NEWSWIRE) -- Wintrust Financial Corporation (“Wintrust” or “the Company”) (Nasdaq:WTFC) announced net income of $35.5 million or $0.64 per diluted common share for the fourth quarter of 2015 compared to net income of $38.4 million or $0.69 per diluted common share for the third quarter of 2015 and $38.1 million or $0.75 per diluted common share for the fourth quarter of 2014. The Company recorded record net income of $156.7 million or $2.93 per diluted common share for the year ended 2015 compared to net income of $151.4 million or $2.98 per diluted common share for the year ended 2014.

Operating net income was $39.5 million or $0.71 per diluted common share for the fourth quarter of 2015 compared to $41.9 million or $0.75 per diluted common share in the third quarter of 2015. Operating net income excludes acquisition and non-operating compensation charges totaling $6.5 million and $5.7 million in the fourth quarter of 2015 and third quarter of 2015, respectively. Operating net income was $165.7 million or $3.10 per diluted common share for the year ended 2015 compared to $151.4 million or $2.98 per diluted common share for the year ended 2014. Operating net income excludes acquisition and non-operating compensation charges totaling $14.0 million for the year ended 2015. A table reconciling net income as reported to operating net income is set forth below and additional detail is shown in the "Supplemental Financial Measures/Ratios" section.

Highlights compared with the Third Quarter of 2015*:

  • Total loans, excluding covered loans and mortgage loans held-for-sale, increased by $802 million, or 19% on an annualized basis, to $17.1 billion with $499 million occurring in December, creating positive average balance growth momentum for the first quarter of 2016.
  • Total assets increased by 16% on an annualized basis to nearly $23 billion.
  • Total deposits increased by $411 million, or 9% on an annualized basis, to $18.6 billion. Non-interest bearing deposit accounts now comprise 26% of total deposits.
  • Net interest margin decreased 4 basis points primarily as a result of lower yields on earning assets. Lower accretion on covered loans and competitive pricing on commercial premium finance and commercial real estate loans impacted the net interest margin the most during the quarter. The lower accretion on covered loans is expected to continue to have a slight negative impact on the net interest margin in 2016.
  • Non-performing loans as a percentage of total loans, excluding covered loans, decreased to 0.49% from 0.53% and the allowance for loan losses as a percentage of total non-performing loans, excluding covered loans, increased to 125% from 120%. OREO expenses increased by $3.0 million in the current quarter due to operating expenses (net of rental income) increasing $716,000, recognized gains on sales decreasing $1.1 million and valuation write-downs increasing $1.1 million.
  • Maintained strong capital ratios with a tangible common equity ratio, assuming full conversion of convertible preferred stock stock, of 7.7%.
  • Acquisition and non-operating compensation charges totaling $6.5 million reduced earnings per diluted common share by $0.07 per share. Exceeded targeted amounts as an additional $2.2 million of non-operating compensation charges were incurred in the fourth quarter relating to pension and additional severance costs.
  • Transferred approximately $866 million in available-for-sale securities to held-to-maturity securities classification.
  • Opened the newly renovated space in 231 S. LaSalle, in the heart of Chicago's financial district.
  • Closed six banking locations previously acquired from Suburban Illinois Bancorp, Inc. as a part of the integration of operations.

Three Months Ended, Year Ended,
December 31, September 30, June 30, March 31, December 31,
(Dollars in thousands, except per share data) 2015 2015 2015 2015 2015
Key Operating Measures, Adjusted for Acquisition and Non-Operating Compensation Charges
Net income per common share – diluted $0.71 $0.75 $0.86 $0.77 $3.10
Net overhead ratio 1.70% 1.63% 1.51% 1.68% 1.63%
Efficiency ratio 68.70% 66.67% 65.16% 67.56% 67.01%
Return on average assets 0.70% 0.77% 0.88% 0.81% 0.79%
Return on average common equity 6.79% 7.29% 8.55% 7.77% 7.59%
Return on average tangible common equity 9.10% 9.78% 11.07% 10.12% 10.01
%
Net income, as reported $35,512 $38,355 $43,831 $39,052 $156,749
Acquisition and Non-Operating Compensation Charges
Salaries and employee benefits:
Salaries $1,113 $1,355 $ $12 $2,480
Commissions and incentive compensation 144 264 3 411
Benefits 1,550 107 1,657
Total salaries and employee benefits 2,807 1,726 15 4,548
Equipment 5 36 32 73
Occupancy, net 605 201 16 822
Data processing 1,504 2,692 653 130 4,979
Advertising and marketing 66 1 5 72
Professional fees(1) 145 335 417 568 1,465
Other expense 757 5 21 4 787
Other income (572) (674) (1,246)
Total Acquisition and Non-Operating Compensation Charges $6,461 $5,670 $1,123 $738 $13,992
Income tax benefit on acquisition and non-operating compensation charges $2,486 $2,112 $276
$131
$5,005
Acquisition and non-operating compensation charges, net of tax $3,975 $3,558 $847
$607
$8,987
Operating net income $39,487 $41,913 $44,678 $39,659 $165,736

(1) Acquisition related legal fees are non-deductible for income tax purposes.

* See "Supplemental Financial Measures/Ratios" on pages 16-18 for more information on non-GAAP measures.

Edward J. Wehmer, President and Chief Executive Officer, commented, “Wintrust reported record annual net income in 2015 even with additional acquisition and non-operating compensation charges during the year. The Company grew significantly during the year as total assets increased by 15%, reaching nearly $23 billion. Operating net income totaled $39.5 million for the fourth quarter of 2015 and $165.7 million for the full year as earnings were impacted by acquisition and non-operating compensation charges totaling $6.5 million pre-tax in the fourth quarter of 2015 and $14.0 million pre-tax for the full year. Additionally, the fourth quarter of 2015 was highlighted by continued strong loan and deposit growth, improvement in non-performing assets and decreased mortgage banking revenue."

Mr. Wehmer continued, “The expected positive impact from the increase in interest rates announced by the Federal Reserve Bank in late December will be realized throughout 2016. The company is well positioned to benefit from future increases in interest rates should they occur, barring significant changes in spreads due to competitive pressures or changes in the shape of the yield curve."

Commenting on credit quality, Mr. Wehmer noted, “Total non-performing assets, excluding covered assets, decreased by $9.9 million during the fourth quarter of 2015 resulting in non-performing assets as a percentage of total assets dropping from 0.63% to 0.56% during the period. Additionally, the allowance for loan losses as a percentage of non-performing loans, excluding covered loans, increased to 125%, exhibiting greater coverage for those non-performing credits. During the quarter, the Company has continued its practice of timely addressing and resolving non-performing credits. We believe the Company's reserves remain appropriate."

Mr. Wehmer further commented, “Mortgage banking revenue totaled $23.3 million in the fourth quarter of 2015, a decrease of $4.6 million from the third quarter of 2015 and a decrease of $1.4 million from the fourth quarter of 2014. The decrease during the current quarter compared to the third quarter of 2015 resulted primarily from origination volumes declining to $808.9 million from $973.7 million due to typical seasonality. Our mortgage pipeline remains strong. We believe that our mortgage banking business remains well positioned to grow both organically and through acquisitions. The Company’s newly created Wintrust Commercial Finance leasing operations grew outstandings by $220 million since its inception in April of this year. This new venture is positioned to continue to expand in 2016, enhancing our earning asset growth and adding to further asset diversification."

Commenting further, Mr. Wehmer stated, “2015 was a year marked by long-term investments by the Company. We completed four bank acquisitions adding $1.1 billion in assets while already driving out approximately $19.6 million of annual legacy operating costs. Additionally, we recently announced plans to acquire Generations Bancorp, Inc. another cost saving opportunity. We invested in a new leasing operation which is off to a fast start. Two major investments in 2015 were in the new classic bank facility in the heart of Chicago’s financial district to house our middle market commercial lending and wealth management operations and multi-year branding sponsorships with multiple iconic sporting and cultural organizations in order to secure our position as Chicago and Wisconsin’s bank. The bank acquisitions came with a cost as evidenced by the $14 million of acquisition and non-operating compensation charges experienced in 2015. That being said, we recorded record net income for the year and operating net income as defined increased by 9% year over year. These investments are expected to pay substantial dividends in the coming year and beyond. Our lending pipelines remain strong, our momentum is very good and our balance sheet is well positioned for potential rising rates. We are very excited about the coming year."

In conclusion, Mr. Wehmer noted, “2016 marks the 25th anniversary of the beginning of Wintrust as an organization. Throughout our life to date we have never wavered from our basic operating tenets that were established on day one. These centered on serving our customers, communities, employees and shareholders. While in our wildest dreams in 1991 we never would have thought we would be where we are right now, while never losing sight of our objectives, we continue to take a steady and measured approach to achieve our main objectives of growing franchise value, increasing profitability, leveraging our expense infrastructure and increasing shareholder value."

Graphs accompanying this release are available at http://www.globenewswire.com/NewsRoom/AttachmentNg/b6aa53c2-2243-4937-afad-bb1caca58745

Wintrust’s key operating measures and growth rates for the fourth quarter of 2015, as compared to the sequential and linked quarters are shown in the table below:

% or(5)
basis point (bp)
change
from
3rd Quarter
2015
% or
basis point (bp)
change
from
4th Quarter
2014
Three Months Ended
(Dollars in thousands) December 31, 2015 September 30, 2015 December 31, 2014
Net income $35,512 $38,355 $38,133 (7)% (7)%
Net income per common share – diluted $0.64 $0.69 $0.75 (7)% (15)%
Net revenue (1) $232,296 $230,493 $211,376 1 % 10 %
Net interest income $167,206 $165,540 $153,719 1 % 9 %
Net interest margin (2) 3.29% 3.33% 3.46% (4)bp (17)bp
Net overhead ratio (2) (3) 1.82% 1.74% 1.76% 8 bp 6 bp
Efficiency ratio (2) (4) 71.39% 69.02% 67.59% 237 bp 380 bp
Return on average assets 0.63% 0.70% 0.78% (7)bp (15)bp
Return on average common equity 6.03% 6.60% 7.51% (57)bp (148)bp
Return on average tangible common equity 8.12% 8.88% 9.82% (76)bp (170)bp
At end of period
Total assets $22,917,166 $22,043,930 $20,010,727 16 % 15 %
Total loans, excluding loans held-for-sale, excluding covered loans $17,118,117 $16,316,211 $14,409,398 19 % 19 %
Total loans, including loans held-for-sale, excluding covered loans $17,506,155 $16,663,216 $14,760,688 20 % 19 %
Total deposits $18,639,634 $18,228,469 $16,281,844 9 % 14 %
Total shareholders’ equity $2,352,274 $2,335,736 $2,069,822 3 % 14 %

(1) Net revenue is net interest income plus non-interest income.
(2) See “Supplemental Financial Measures/Ratios” for additional information on this performance measure/ratio.
(3) The net overhead ratio is calculated by netting total non-interest expense and total non-interest income, annualizing this amount, and dividing by that period's average total assets. A lower ratio indicates a higher degree of efficiency.
(4) The efficiency ratio is calculated by dividing total non-interest expense by tax-equivalent net revenue (less securities gains or losses). A lower ratio indicates more efficient revenue generation.
(5) Period-end balance sheet percentage changes are annualized.

Certain returns, yields, performance ratios, or quarterly growth rates are “annualized” in this presentation to represent an annual time period. This is done for analytical purposes to better discern for decision-making purposes underlying performance trends when compared to full-year or year-over-year amounts. For example, a 5% growth rate for a quarter would represent an annualized 20% growth rate. Additional supplemental financial information showing quarterly trends can be found on the Company’s web site at www.wintrust.com by choosing “Financial Reports” under the “Investor Relations” heading, and then choosing “Supplemental Financial Information.”

Financial Performance Overview – Fourth Quarter 2015

For the fourth quarter of 2015, net interest income totaled $167.2 million, an increase of $1.7 million as compared to the third quarter of 2015 and an increase of $13.5 million as compared to the fourth quarter of 2014. The changes in net interest income on both a sequential and linked quarter basis are the result of the following:

  • Net interest income increased $1.7 million in the fourth quarter of 2015 compared to the third quarter of 2015, due to:
    • An increase in total interest income of $2.1 million resulting primarily from loan growth during the period, partially offset by by a reduction in yield on earning assets.
    • Interest expense increased $442,000 primarily as a result of an increase in the average balance of interest-bearing liabilities and a one basis point increase in the rate on average interest bearing liabilities.
    • Combined, the increase in interest income of $2.1 million and the increase in interest expense of $442,000 created the $1.7 million increase in net interest income.
  • Net interest income increased $13.5 million in the fourth quarter of 2015 compared to the fourth quarter of 2014, due to:
    • Average loans, excluding covered loans, increased by $2.4 billion compared to the fourth quarter of 2014. The growth in average loans, excluding covered loans, was partially offset by a 20 basis point decline in the yield on earning assets, resulting in an increase in total interest income of $14.8 million.
    • An increase in interest bearing deposits, an increase in borrowings under the Company's term credit facility at the end of the second quarter of 2015 and the completion of the Canadian secured borrowing transaction at the end of the fourth quarter of 2014 resulted in a $1.3 million increase in interest expense.
    • Combined, the increase in interest income of $14.8 million and the increase of interest expense of $1.3 million created the $13.5 million increase in net interest income in the fourth quarter of 2015 compared to the fourth quarter of 2014.

The net interest margin, on a fully taxable equivalent basis, for the fourth quarter of 2015 was 3.29% compared to 3.33% for the third quarter of 2015 and 3.46% for the fourth quarter of 2014. The reduction in net interest margin, on a fully taxable equivalent basis, compared to the third quarter of 2015 and the fourth quarter of 2014 is primarily the result of a decline in yield on non-covered and covered loans (see "Net Interest Income" section later in this release for further detail).

Non-interest income totaled $65.1 million in the fourth quarter of 2015, relatively steady compared to the third quarter of 2015 and increasing $7.4 million, or 13%, compared to the fourth quarter of 2014. The increase in non-interest income in the fourth quarter of 2015 compared to the fourth quarter of 2014 was primarily attributable to higher customer interest rate swap fees, increased income on operating leases through our leasing division and lower FDIC indemnification asset amortization. (see “Non-Interest Income” section later in this release for further detail).

Non-interest expense totaled $166.8 million in the fourth quarter of 2015, increasing $6.9 million, or 4%, compared to the third quarter of 2015 and increasing $23.4 million, or 16%, compared to the fourth quarter of 2014. The increase in the current quarter compared to the third quarter of 2015 can be primarily attributed to an increase in acquisition and non-operating compensation charges, higher salary and employee benefit costs caused by the addition of employees from the various acquisitions and higher staffing levels as the Company grows, higher OREO expense and increased equipment and occupancy expense. The increase in the fourth quarter of 2015 compared to the fourth quarter of 2014 was primarily related to acquisition and non-operating compensation charges in the current quarter, higher salary and employee benefit costs caused by the addition of employees from the various acquisitions and higher staffing levels as the Company grows, increased equipment and occupancy, data processing and professional fees and higher marketing expenses (see "Non-Interest Expense" section later in this release for further detail).

Financial Performance Overview – Full Year 2015

For the full year of 2015, net interest income totaled $641.5 million, an increase of $43.0 million as compared to 2014 as a result of the following:

  • Average earning assets increased by $2.2 billion primarily comprised of average loan growth, excluding covered loans, of $2.1 billion and an increase of $231.1 million in the average balance of liquidity management assets, partially offset by a decrease of $94.5 million in the average balance of covered loans. The growth in average total loans, excluding covered loans, included an increase of $691.3 million in commercial loans, $622.3 million in commercial real estate loans, $505.8 million in life insurance premium finance receivables, $106.0 million in home equity and other loans, $72.3 million in mortgage loans held-for-sale and $65.8 million in commercial premium finance receivables.
  • The average earning asset growth of $2.2 billion, partially offset by a 20 basis point decrease in yield on earning assets, resulted in an increase in total interest income of $47.2 million.
  • Funding mix remained consistent as average demand deposits increased $1.1 billion, average interest bearing deposits increased $800.7 million and average wholesale borrowings increased $173.7 million. The increase in average interest bearing liabilities, partially offset by a one basis point decline in rate during the current year, resulted in a $4.2 million increase in interest expense.
  • Combined, the increase in interest income of $47.2 million and the increase in interest expense of $4.2 million created the $43.0 million increase in net interest income.

The net interest margin, on a fully taxable equivalent basis, for 2015 was 3.36%, compared to 3.53% for 2014 (see "Net Interest Income" section later in this release for further detail).

Non-interest income totaled $271.6 million in 2015, increasing $56.4 million, or 26%, compared to 2014. The increase in non-interest income in 2015 compared to 2014 is primarily attributable to an increase in mortgage banking and wealth management revenues, fees from covered call options, the recognition of $2.1 million in BOLI death benefits, increased service charges, higher fees on customer interest rate swap transactions, increased income on operating leases through our leasing division and lower FDIC indemnification asset amortization (see "Non-Interest Income" section later in this release for further detail).

Non-interest expense totaled $628.4 million in 2015, increasing $81.6 million, or 15%, compared to 2014. The increase in 2015 compared to 2014 was primarily attributable to acquisition and non-operating compensation charges during the current year, higher salary and employee benefit costs caused by the addition of employees from the various acquisitions and larger staffing as the Company grows as well as higher commissions and incentive compensation, and increased equipment, occupancy, data processing and professional fees, and increased marketing expenses, partially offset by a decrease in OREO expenses (see "Non-Interest Expense" section later in this release for further detail).

Financial Performance Overview – Credit Quality

The ratio of non-performing assets to total assets was 0.56% as of December 31, 2015, compared to 0.63% at September 30, 2015 and 0.62% at December 31, 2014. Non-performing assets, excluding covered assets, totaled $128.2 million at December 31, 2015, compared to $138.0 million at September 30, 2015 and $124.6 million at December 31, 2014.

Non-performing loans, excluding covered loans, totaled $84.1 million, or 0.49% of total loans, at December 31, 2015, compared to $86.0 million, or 0.53% of total loans, at September 30, 2015 and $78.7 million, or 0.55% of total loans, at December 31, 2014. The decrease in non-performing loans, excluding covered loans, compared to September 30, 2015 is primarily the result of a $2.0 million decrease in the commercial real estate loan portfolio and a $4.0 million decrease in the home equity and residential real estate loan portfolios, partially offset by a $2.9 million increase in the commercial insurance premium finance receivables loan portfolio. OREO, excluding covered OREO, of $43.9 million at December 31, 2015 decreased $7.9 million compared to $51.9 million at September 30, 2015 and decreased $1.7 million compared to $45.6 million at December 31, 2014.

Net charge-offs as a percentage of loans, excluding covered loans, for the fourth quarter of 2015 totaled 15 basis points on an annualized basis compared to 14 basis points on an annualized basis in the third quarter of 2015 and 16 basis points on an annualized basis in the fourth quarter of 2014. Net charge-offs totaled $6.6 million in the fourth quarter of 2015, an $884,000 increase from $5.7 million in the third quarter of 2015 and a $694,000 increase from $5.9 million in the fourth quarter of 2014.

The provision for credit losses, excluding the provision for covered loan losses, totaled $9.2 million for the fourth quarter of 2015 compared to $8.7 million for the third quarter of 2015 and $6.7 million in the fourth quarter of 2014. The higher provision for credit losses in the fourth quarter of 2015 compared to the same period of 2014 was partially due to the loan growth in the current period.

Excluding the allowance for covered loan losses, the allowance for credit losses at December 31, 2015 totaled $106.3 million, or 0.62% of total loans, compared to $103.9 million, or 0.64% of total loans at September 30, 2015 and $92.5 million, or 0.64% of total loans at December 31, 2014. The allowance for unfunded lending-related commitments totaled $949,000 as of December 31, 2015 compared to $926,000 as of September 30, 2015 and $775,000 as of December 31, 2014.

Financial Performance Overview – Earnings Per Share

The following table shows the computation of basic and diluted earnings per share for the periods indicated:

Three Months Ended Years Ended
(In thousands, except per share data) December 31, 2015 September 30, 2015 December 31, 2014 December 31, 2015 December 31, 2014
Net income $35,512 $38,355 $38,133 $156,749 $151,398
Less: Preferred stock dividends and discount accretion 3,629 4,079 1,580 10,869 6,323
Net income applicable to common shares—Basic(A) 31,883 34,276 36,553 145,880 145,075
Add: Dividends on convertible preferred stock, if dilutive 1,579 1,579 1,580 6,314 6,323
Net income applicable to common shares—Diluted(B) 33,462 35,855 38,133 152,194 151,398
Weighted average common shares outstanding(C) 48,371 48,158 46,734 47,838 46,524
Effect of dilutive potential common shares:
Common stock equivalents 935 978 1,168 1,029 1,246
Convertible preferred stock, if dilutive 3,070 3,071 3,075 3,070 3,075
Weighted average common shares and effect of dilutive potential common shares(D) 52,376 52,207 50,977 51,937 50,845
Net income per common share:
Basic(A/C) $0.66 $0.71 $0.78 $3.05 $3.12
Diluted(B/D) $0.64 $0.69 $0.75 $2.93 $2.98

Potentially dilutive common shares can result from stock options, restricted stock unit awards, stock warrants, the Company’s convertible preferred stock and shares to be issued under the Employee Stock Purchase Plan and the Directors Deferred Fee and Stock Plan, being treated as if they had been either exercised or issued, computed by application of the treasury stock method. While potentially dilutive common shares are typically included in the computation of diluted earnings per share, potentially dilutive common shares are excluded from this computation in periods in which the effect would reduce the loss per share or increase the income per share. For diluted earnings per share, net income applicable to common shares can be affected by the conversion of the Company’s convertible preferred stock. Where the effect of this conversion would reduce the loss per share or increase the income per share, net income applicable to common shares is not adjusted by the associated preferred dividends. Due to weighted average share differences, when stated on a quarter and year-to-date basis, the earnings per share for the year-to-date period may not equal the sum of the respective earnings per share for the respective quarters then ended.

WINTRUST FINANCIAL CORPORATION
Selected Financial Highlights
Three Months Ended Years Ended
(Dollars in thousands, except per share data)December 31, 2015 September 30, 2015 December 31, 2014 December 31, 2015 December 31, 2014
Selected Financial Condition Data (at end of period):
Total assets$22,917,166 $22,043,930 $20,010,727
Total loans, excluding loans held-for-sale and covered loans17,118,117 16,316,211 14,409,398
Total deposits18,639,634 18,228,469 16,281,844
Junior subordinated debentures268,566 268,566 249,493
Total shareholders’ equity2,352,274 2,335,736 2,069,822
Selected Statements of Income Data:
Net interest income$167,206 $165,540 $153,719 $641,529 $598,575
Net revenue (1)232,296 230,493 211,376 913,126 813,815
Net income35,512 38,355 38,133 156,749 151,398
Net income per common share – Basic$0.66 $0.71 $0.78 $3.05 $3.12
Net income per common share – Diluted$0.64 $0.69 $0.75 $2.93 $2.98
Selected Financial Ratios and Other Data:
Performance Ratios:
Net interest margin (2)3.29% 3.33% 3.46% 3.36% 3.53%
Non-interest income to average assets1.16% 1.19% 1.18% 1.29% 1.15%
Non-interest expense to average assets2.98% 2.93% 2.94% 2.99% 2.92%
Net overhead ratio (2) (3)1.82% 1.74% 1.76% 1.70% 1.77%
Efficiency ratio (2) (4)71.39% 69.02% 67.59% 68.49% 66.89%
Return on average assets0.63% 0.70% 0.78% 0.75% 0.81%
Return on average common equity6.03% 6.60% 7.51% 7.15% 7.77%
Return on average tangible common equity (2)8.12% 8.88% 9.82% 9.44% 10.14%
Average total assets$22,233,492 $21,688,450 $19,366,670 $21,009,773 $18,699,458
Average total shareholders’ equity2,347,545 2,310,511 2,057,855 2,232,989 1,993,959
Average loans to average deposits ratio (excluding covered loans)91.9% 91.9% 89.5% 92.0% 89.9%
Average loans to average deposits ratio (including covered loans)92.7% 92.9% 91.0% 93.1% 91.7%
Common Share Data at end of period:
Market price per common share$48.52 $53.43 $46.76
Book value per common share (2)$43.42 $43.12 $41.52
Tangible common book value per share (2)$33.17 $32.83 $32.45
Common shares outstanding48,383,279 48,336,870 46,805,055
Other Data at end of period:(8)
Leverage Ratio (5)9.1% 9.2% 10.2%
Tier 1 capital to risk-weighted assets (5)10.0% 10.3% 11.6%
Common equity Tier 1 capital to risk-weighted assets(5)8.4% 8.6% N/A
Total capital to risk-weighted assets (5)12.2% 12.6% 13.0%
Tangible common equity ratio (TCE) (2)(7)7.2% 7.4% 7.8%
Tangible common equity ratio, assuming full conversion of preferred stock (2) (7)7.7% 8.0% 8.4%
Allowance for credit losses (6)$106,349 $103,922 $92,480
Non-performing loans$84,057 $85,976 $78,677
Allowance for credit losses to total loans (6)0.62% 0.64% 0.64%
Non-performing loans to total loans0.49% 0.53% 0.55%
Number of:
Bank subsidiaries15 15 15
Banking offices152 160 140

(1) Net revenue includes net interest income and non-interest income.
(2) See “Supplemental Financial Measures/Ratios” for additional information on this performance measure/ratio.
(3) The net overhead ratio is calculated by netting total non-interest expense and total non-interest income, annualizing this amount, and dividing by that period’s total average assets. A lower ratio indicates a higher degree of efficiency.
(4) The efficiency ratio is calculated by dividing total non-interest expense by tax-equivalent net revenue (less securities gains or losses). A lower ratio indicates more efficient revenue generation.
(5) Capital ratios for current quarter-end are estimated.
(6) The allowance for credit losses includes both the allowance for loan losses and the allowance for unfunded lending-related commitments, but excludes the allowance for covered loan losses.
(7) Total shareholders’ equity minus preferred stock and total intangible assets divided by total assets minus total intangible assets.
(8) Asset quality ratios exclude covered loans.

WINTRUST FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CONDITION
(In thousands) (Unaudited)
December 31,
2015
(Unaudited)
September 30,
2015
December 31,
2014
Assets
Cash and due from banks $252,227 $247,341 $225,136
Federal funds sold and securities purchased under resale agreements 4,341 3,314 5,571
Interest bearing deposits with banks 627,009 701,106 998,437
Available-for-sale securities, at fair value 1,716,388 2,214,281 1,792,078
Held-to-maturity securities, at amortized cost 884,826
Trading account securities 448 3,312 1,206
Federal Home Loan Bank and Federal Reserve Bank stock 101,581 90,308 91,582
Brokerage customer receivables 27,631 28,293 24,221
Mortgage loans held-for-sale 388,038 347,005 351,290
Loans, net of unearned income, excluding covered loans 17,118,117 16,316,211 14,409,398
Covered loans 148,673 168,609 226,709
Total loans 17,266,790 16,484,820 14,636,107
Less: Allowance for loan losses 105,400 102,996 91,705
Less: Allowance for covered loan losses 3,026 2,918 2,131
Net loans 17,158,364 16,378,906 14,542,271
Premises and equipment, net 592,256 587,348 555,228
Lease investments, net 63,170 29,111 426
FDIC indemnification asset 11,846
Accrued interest receivable and other assets 604,917 637,925 501,456
Trade date securities receivable 277,981 485,534
Goodwill 471,761 472,166 405,634
Other intangible assets 24,209 25,533 18,811
Total assets $22,917,166 $22,043,930 $20,010,727
Liabilities and Shareholders’ Equity
Deposits:
Non-interest bearing $4,836,420 $4,705,994 3,518,685
Interest bearing 13,803,214 13,522,475 12,763,159
Total deposits 18,639,634 18,228,469 16,281,844
Federal Home Loan Bank advances 859,876 451,330 733,050
Other borrowings 266,019 259,978 196,465
Subordinated notes 140,000 140,000 140,000
Junior subordinated debentures 268,566 268,566 249,493
Trade date securities payable 538 617 3,828
Accrued interest payable and other liabilities 390,259 359,234 336,225
Total liabilities 20,564,892 19,708,194 17,940,905
Shareholders’ Equity:
Preferred stock 251,287 251,312 126,467
Common stock 48,469 48,422 46,881
Surplus 1,190,988 1,187,407 1,133,955
Treasury stock (3,973) (3,964) (3,549)
Retained earnings 928,211 901,652 803,400
Accumulated other comprehensive loss (62,708) (49,093) (37,332)
Total shareholders’ equity 2,352,274 2,335,736 2,069,822
Total liabilities and shareholders’ equity $22,917,166 $22,043,930 $20,010,727


WINTRUST FINANCIAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED, except for the year ended December 31, 2014)
Three Months Ended Years Ended
(In thousands, except per share data) December 31, 2015 September 30, 2015 December 31, 2014 December 31, 2015 December 31, 2014
Interest income
Interest and fees on loans $169,501 $167,831 $157,476 $651,831 $613,024
Interest bearing deposits with banks 493 372 495 1,486 1,472
Federal funds sold and securities purchased under resale agreements 1 3 4 25
Investment securities 16,405 16,130 13,761 61,006 52,951
Trading account securities 25 19 45 108 79
Federal Home Loan Bank and Federal Reserve Bank stock 857 821 749 3,232 2,920
Brokerage customer receivables 206 205 186 797 796
Total interest income 187,487 185,379 172,715 718,464 671,267
Interest expense
Interest on deposits 12,617 12,436 12,431 48,863 48,411
Interest on Federal Home Loan Bank advances 2,684 2,458 2,534 9,110 10,523
Interest on other borrowings 1,007 1,045 313 3,627 1,773
Interest on subordinated notes 1,777 1,776 1,776 7,105 3,906
Interest on junior subordinated debentures 2,196 2,124 1,942 8,230 8,079
Total interest expense 20,281 19,839 18,996 76,935 72,692
Net interest income 167,206 165,540 153,719 641,529 598,575
Provision for credit losses 9,059 8,322 6,133 32,942 20,537
Net interest income after provision for credit losses 158,147 157,218 147,586 608,587 578,038
Non-interest income
Wealth management 18,634 18,243 18,649 73,452 71,343
Mortgage banking 23,317 27,887 24,694 115,011 91,617
Service charges on deposit accounts 7,210 7,403 6,189 27,384 23,307
(Losses) gains on available-for-sale securities, net (79) (98) 18 323 (504)
Fees from covered call options 3,629 2,810 2,966 15,364 7,859
Trading gains (losses), net 205 (135) (507) (247) (1,609)
Operating lease income, net 1,973 613 67 2,728 163
Other 10,201 8,230 5,581 37,582 23,064
Total non-interest income 65,090 64,953 57,657 271,597 215,240
Non-interest expense
Salaries and employee benefits 99,780 97,749 87,633 382,080 335,506
Equipment 8,772 8,414 7,502 32,812 29,609
Equipment on operating lease 1,229 473 53 1,826 142
Occupancy, net 13,062 12,066 11,600 48,880 42,889
Data processing 7,284 8,127 5,313 26,940 19,336
Advertising and marketing 5,373 6,237 3,669 21,924 13,571
Professional fees 4,387 4,100 4,039 18,225 15,574
Amortization of other intangible assets 1,324 1,350 1,171 4,621 4,692
FDIC insurance 3,317 3,035 2,810 12,386 12,168
OREO expenses, net 2,598 (367) 2,320 4,483 9,367
Other 19,703 18,790 17,331 74,242 63,993
Total non-interest expense 166,829 159,974 143,441 628,419 546,847
Income before taxes 56,408 62,197 61,802 251,765 246,431
Income tax expense 20,896 23,842 23,669 95,016 95,033
Net income $35,512 $38,355 $38,133 $156,749 $151,398
Preferred stock dividends and discount accretion $3,629 $4,079 $1,580 $10,869 $6,323
Net income applicable to common shares $31,883 $34,276 $36,553 $145,880 $145,075
Net income per common share - Basic $0.66 $0.71 $0.78 $3.05 $3.12
Net income per common share - Diluted $0.64 $0.69 $0.75 $2.93 $2.98
Cash dividends declared per common share $0.11 $0.11 $0.10 $0.44 $0.40
Weighted average common shares outstanding 48,371 48,158 46,734 47,838 46,524
Dilutive potential common shares 4,005 4,049 4,243 4,099 4,321
Average common shares and dilutive common shares 52,376 52,207 50,977 51,937 50,845

SUPPLEMENTAL FINANCIAL MEASURES/RATIOS

The accounting and reporting policies of Wintrust conform to generally accepted accounting principles (“GAAP”) in the United States and prevailing practices in the banking industry. However, certain non-GAAP performance measures and ratios are used by management to evaluate and measure the Company’s performance. These include taxable-equivalent net interest income (including its individual components), net interest margin (including its individual components), the efficiency ratio, tangible common equity ratio, tangible common book value per share and return on average tangible common equity. In addition, certain operating measures and ratios are adjusted for acquisition and non-operating compensation charges. These operating measures and ratios include operating net income, the efficiency ratio, the net overhead ratio, return on average assets, return on average common equity, return on average tangible common equity and net income per diluted common share. Management believes that these measures and ratios provide users of the Company’s financial information a more meaningful view of the performance of the interest-earning assets and interest-bearing liabilities and of the Company’s operating efficiency. Other financial holding companies may define or calculate these measures and ratios differently.

Management reviews yields on certain asset categories and the net interest margin of the Company and its banking subsidiaries on a fully taxable-equivalent (“FTE”) basis. In this non-GAAP presentation, net interest income is adjusted to reflect tax-exempt interest income on an equivalent before-tax basis. This measure ensures comparability of net interest income arising from both taxable and tax-exempt sources. Net interest income on a FTE basis is also used in the calculation of the Company’s efficiency ratio. The efficiency ratio, which is calculated by dividing non-interest expense by total taxable-equivalent net revenue (less securities gains or losses), measures how much it costs to produce one dollar of revenue. Securities gains or losses are excluded from this calculation to better match revenue from daily operations to operational expenses. Management considers the tangible common equity ratio and tangible book value per common share as useful measurements of the Company’s equity. The Company references the return on average tangible common equity as a measurement of profitability. Management considers operating net income, which is reported net income excluding acquisition and non-operating compensation charges, as a useful measure of operating performance. Acquisition related charges are specific costs incurred by the Company as a result of an acquisition that are not expected to continue in subsequent periods. Non-operating compensation charges are certain salary and employee benefit costs incurred that are not related to current operating services provided by employees of the Company. The Company excludes acquisition and non-operating compensation charges from reported net income as well as certain operating measures and ratios noted above to provide better comparability between periods.

The following table presents a reconciliation of certain non-GAAP performance measures and ratios used by the Company to evaluate and measure the Company’s performance to the most directly comparable GAAP-derived financial measures for the last 5 quarters:

Three Months Ended Years Ended
December 31, September 30, June 30, March 31, December 31, December 31,
(Dollars and shares in thousands) 2015 2015 2015 2015 2014(1) 2015 2014(1)
Calculation of Net Interest Margin and Efficiency Ratio
(A) Interest Income (GAAP) $187,487 $185,379 $175,241 $170,357 $172,715 $718,464 $671,267
Taxable-equivalent adjustment:
- Loans 430 346 328 327 301 1,431 1,128
- Liquidity Management Assets 866 841 787 727 555 3,221 2,000
- Other Earning Assets 13 10 27 7 24 57 41
Interest Income - FTE $188,796 $186,576 $176,383 $171,418 $173,595 $723,173 $674,436
(B) Interest Expense (GAAP) 20,281 19,839 18,349 18,466 18,996 76,935 72,692
Net interest income - FTE $168,515 $166,737 $158,034 $152,952 $154,599 $646,238 $601,744
(C) Net Interest Income (GAAP) (A minus B) $167,206 $165,540 $156,892 $151,891 $153,719 $641,529 $598,575
(D) Net interest margin (GAAP-derived) 3.26% 3.31% 3.39% 3.40% 3.44% 3.34% 3.51%
Net interest margin - FTE 3.29% 3.33% 3.41% 3.42% 3.46% 3.36% 3.53%
(E) Efficiency ratio (GAAP-derived) 71.79% 69.38% 65.96% 68.23% 67.87% 68.84% 67.15%
Efficiency ratio - FTE 71.39% 69.02% 65.64% 67.90% 67.59% 68.49% 66.89%
Efficiency ratio - Adjusted for acquisition and non-operating compensation charges 68.70% 66.67% 65.16% 67.56% 67.59% 67.01% 66.89%
(F) Net Overhead Ratio (GAAP-derived) 1.82% 1.74% 1.53% 1.69% 1.76% 1.70% 1.77%
Net Overhead Ratio - Adjusted for acquisition and non-operating compensation charges 1.70% 1.63% 1.51% 1.68% 1.76% 1.63% 1.77%
Calculation of Tangible Common Equity ratio (at period end)
Total shareholders’ equity $2,352,274 $2,335,736 $2,264,982 $2,131,074 $2,069,822
(G) Less: Convertible preferred stock (126,287) (126,312) (126,312) (126,427) (126,467)
Less: Non-convertible preferred stock (125,000) (125,000) (125,000)
Less: Intangible assets (495,970) (497,699) (439,570) (439,055) (424,445)
(H) Total tangible common shareholders’ equity $1,605,017 $1,586,725 $1,574,100 $1,565,592 $1,518,910
Total assets $22,917,166 $22,043,930 $20,799,924 $20,382,271 $20,010,727
Less: Intangible assets (495,970) (497,699) (439,570) (439,055) (424,445)
(I) Total tangible assets $22,421,196 $21,546,231 $20,360,354 $19,943,216 $19,586,282
Tangible common equity ratio (H/I) 7.2% 7.4% 7.7% 7.9% 7.8%
Tangible common equity ratio, assuming full conversion of preferred stock ((H-G)/I) 7.7% 8.0% 8.4% 8.5% 8.4%
Calculation of book value per share
Total shareholders’ equity $2,352,274 $2,335,736 $2,264,982 $2,131,074 $2,069,822
Less: Preferred stock (251,287) (251,312) (251,312) (126,427) (126,467)
(J) Total common equity $2,100,987 $2,084,424 $2,013,670 $2,004,647 $1,943,355
(K) Actual common shares outstanding 48,383 48,337 47,677 47,390 46,805
Book value per share (J/K) $43.42 $43.12 $42.24 $42.30 $41.52
Tangible common book value per share (H/K) $33.17 $32.83 $33.02 $33.04 $32.45


Three Months Ended Years Ended
December 31, September 30, June 30, March 31, December 31, December 31,
(Dollars and shares in thousands) 2015 2015 2015 2015 2014 (1) 2015 2014 (1)
Calculation of return on average assets
(L) Net income $35,512 $38,355 $43,831 $39,052 $38,133 $156,749 $151,398
Add: Acquisition and non-operating compensation charges, net of tax 3,975 3,558 847 607 8,987
(M) Operating net income 39,487 41,913 44,678 39,659 38,133 165,736 151,398
(N) Total average assets 22,233,492 21,688,450 20,256,996 19,826,240 19,366,670 21,009,773 18,699,458
Return on average assets, annualized (L/N) 0.63% 0.70% 0.87% 0.80% 0.78% 0.75% 0.81%
Return on average assets, adjusted for acquisition and non-operating compensation charges, annualized (M/N) 0.70% 0.77% 0.88% 0.81% 0.78% 0.79% 0.81%
Calculation of return on average common equity
(O) Net income applicable to common shares $31,883 34,276 42,251 37,471 36,553 $145,880 145,075
(P) Add: Acquisition and non-operating compensation charges, net of tax 3,975 3,558 847 607
8,987
(Q) Add: After-tax intangible asset amortization 834 833 597 615 722 2,879 2,881
(R) Tangible operating net income applicable to common shares $36,692 38,667 43,695 38,693 37,275 $157,746 147,956
Total average shareholders' equity $2,347,545 2,310,511 2,156,128 2,114,356 2,057,855 $2,232,989 1,993,959
Less: Average preferred stock (251,293) (251,312) (134,586) (126,445) (126,467) (191,416) (126,471)
(S) Total average common shareholders' equity $2,096,252 2,059,199 2,021,542 1,987,911 1,931,388 $2,041,573 1,867,488
Less: Average intangible assets (497,199) (490,583) (439,455) (436,456) (425,834) (466,225) (408,642)
(T) Total average tangible common shareholders’ equity $1,599,053 1,568,616 1,582,087 1,551,455 1,505,554 $1,575,348 1,458,846
Return on average common equity, annualized (O/S) 6.03% 6.60% 8.38% 7.64% 7.51% 7.15% 7.77%
Return on average common equity, adjusted for acquisition and non-operating compensation charges, annualized ((O+P)/S) 6.79% 7.29% 8.55% 7.77% 7.51% 7.59% 7.77%
Return on average tangible common equity, annualized ((O+Q)/T) 8.12% 8.88% 10.86% 9.96% 9.82% 9.44% 10.14%
Return on average tangible common equity, adjusted for acquisition and non-operating compensation charges, annualized (R/T) 9.10% 9.78% 11.07% 10.12% 9.82% 10.01
% 10.14%
Calculation of net income per common share - diluted
(U) Net income applicable to common shares - Diluted 33,462 35,855 43,831 39,052 38,133 152,199 151,398
Add: Acquisition and non-operating compensation charges, net of tax 3,975 3,558 847
607
8,987
(V) Net income applicable to common shares - Diluted, adjusted for acquisition and non-operating compensation charges 37,437 39,413 44,678 39,659 38,133 161,186 151,398
Weighted average common shares and effect of dilutive potential common shares (W) 52,376 52,207 51,723 51,472 50,977 51,937 50,845
Net income per common share - Diluted (U/W) $0.64 $0.69 $0.85 $0.76 $0.75 $2.93 $2.98
Net income per common share - Diluted, adjusted for acquisition and non-operating compensation charges (V/W) 0.71 0.75 0.86 0.77 0.75 3.10 2.98

(1) The Company considers acquisition and non-operating compensation charges incurred prior to 2015 to be insignificant.

LOANS
Loan Portfolio Mix and Growth Rates
% Growth
(Dollars in thousands) December 31,
2015
September 30,
2015
December 31,
2014
From (1)
September 30,
2015
From
December 31,
2014
Balance:
Commercial $4,713,909 $4,400,185 $3,924,394 28% 20%
Commercial real estate 5,529,289 5,307,566 4,505,753 17 23
Home equity 784,675 797,465 716,293 (6) 10
Residential real estate 607,451 571,743 483,542 25 26
Premium finance receivables - commercial 2,374,921 2,407,075 2,350,833 (5) 1
Premium finance receivables - life insurance 2,961,496 2,700,275 2,277,571 38 30
Consumer and other 146,376 131,902 151,012 44 (3)
Total loans, net of unearned income, excluding covered loans $17,118,117 $16,316,211 $14,409,398 19% 19%
Covered loans 148,673 168,609 226,709 (47) (34)
Total loans, net of unearned income $17,266,790 $16,484,820 $14,636,107 19% 18%
Mix:
Commercial 27% 27% 26%
Commercial real estate 32 32 31
Home equity 5 5 5
Residential real estate 3 3 3
Premium finance receivables - commercial 14 15 16
Premium finance receivables - life insurance 17 16 16
Consumer and other 1 1 1
Total loans, net of unearned income, excluding covered loans 99% 99% 98%
Covered loans 1 1 2
Total loans, net of unearned income 100% 100% 100%

(1) Annualized

As of December 31, 2015 % of
Total
Balance
Nonaccrual > 90 Days
Past Due
and Still
Accruing
Allowance
For Loan
Losses
Allocation
(Dollars in thousands) Balance
Commercial:
Commercial and industrial $2,851,354 27.8% $12,416 $6 $23,457
Franchise 245,228 2.4 3,086
Mortgage warehouse lines of credit 222,806 2.2 1,628
Community Advantage - homeowner associations 130,986 1.3 3
Aircraft 5,327 0.1 288 7
Asset-based lending 742,684 7.3 8 5,859
Tax exempt 267,273 2.6 1,759
Leases 226,074 2.2 535 232
Other 3,588 20
PCI - commercial loans (1) 18,589 0.2 892 84
Total commercial $4,713,909 46.1% $12,712 $1,433 $36,135
Commercial Real Estate:
Residential construction $70,381 0.7% $273 $ $895
Commercial construction 288,279 2.8 33 3,018
Land 78,417 0.8 1,751 2,467
Office 863,001 8.4 4,619 5,890
Industrial 727,648 7.1 9,564 6,377
Retail 868,399 8.5 1,760 5,597
Multi-family 742,349 7.2 1,954 7,356
Mixed use and other 1,732,816 16.9 6,691 11,809
PCI - commercial real estate (1) 157,999 1.5 22,111 349
Total commercial real estate $5,529,289 53.9% $26,645 $22,111 $43,758
Total commercial and commercial real estate $10,243,198 100.0% $39,357 $23,544 $79,893
Commercial real estate - collateral location by state:
Illinois $4,455,287 80.6%
Wisconsin 581,844 10.5
Total primary markets $5,037,131 91.1%
Florida 55,631 1.0
California 64,018 1.2
Indiana 129,467 2.3
Other (no individual state greater than 0.7%) 243,042 4.4
Total $5,529,289 100.0%

(1) Purchased credit impaired ("PCI") loans represent loans acquired with evidence of credit quality deterioration since origination, in accordance with ASC 310-30. Loan agings are based upon contractually required payments.

DEPOSITS
Deposit Portfolio Mix and Growth Rates
% Growth
(Dollars in thousands) December 31, 2015 September 30, 2015 December 31, 2014 From (1)
September 30,
2015
From
December 31,
2014
Balance:
Non-interest bearing $4,836,420 $4,705,994 $3,518,685 11% 37%
NOW and interest bearing demand deposits 2,390,217 2,231,258 2,236,089 28 7
Wealth Management deposits (2) 1,643,653 1,469,920 1,226,916 47 34
Money Market 4,041,300 4,001,518 3,651,467 4 11
Savings 1,723,367 1,684,007 1,508,877 9 14
Time certificates of deposit 4,004,677 4,135,772 4,139,810 (13) (3)
Total deposits $18,639,634 $18,228,469 $16,281,844 9% 14%
Mix:
Non-interest bearing 26% 26% 22%
NOW and interest bearing demand deposits 13 12 14
Wealth Management deposits (2) 9 8 8
Money Market 22 22 22
Savings 9 9 9
Time certificates of deposit 21 23 25
Total deposits 100% 100% 100%

(1) Annualized
(2) Represents deposit balances of the Company’s subsidiary banks from brokerage customers of Wayne Hummer Investments, trust and asset management customers of The Chicago Trust Company and brokerage customers from unaffiliated companies which have been placed into deposit accounts of the Banks.

Time Certificates of Deposit
Maturity/Re-pricing Analysis
As of December 31, 2015
(Dollars in thousands) CDARs &
Brokered
Certificates
of Deposit (1)
MaxSafe
Certificates
of Deposit (1)
Variable Rate
Certificates
of Deposit (2)
Other Fixed
Rate Certificates
of Deposit (1)
Total Time
Certificates of
Deposit
Weighted-Average
Rate of Maturing
Time Certificates
of Deposit (3)
1-3 months $ $54,940 $147,210 $700,606 $902,756 0.58%
4-6 months 36,506 42,643 577,555 656,704 0.60%
7-9 months 165,621 31,803 536,680 734,104 0.78%
10-12 months 37,691 523,806 561,497 0.80%
13-18 months 43,307 16,608 580,093 640,008 0.91%
19-24 months 1,525 4,666 196,065 202,256 1.02%
24+ months 3,438 15,069 288,845 307,352 1.24%
Total $250,397 $203,420 $147,210 $3,403,650 $4,004,677 0.78%

(1) This category of certificates of deposit is shown by contractual maturity date.
(2) This category includes variable rate certificates of deposit and savings certificates with the majority repricing on at least a monthly basis.
(3) Weighted-average rate excludes the impact of purchase accounting fair value adjustments.

NET INTEREST INCOME

The following table presents a summary of Wintrust’s average balances, net interest income and related net interest margins, calculated on a fully tax-equivalent basis, for the fourth quarter of 2015 compared to the third quarter of 2015 (sequential quarters)and fourth quarter of 2014 (linked quarters):

Average Balance for three months ended, Interest for three months ended, Yield/Rate for three months ended,
(Dollars in thousands)December 31,
2015
September 30,
2015
December 31,
2014
December 31,
2015
September 30,
2015
December 31,
2014
December 31,
2015
September 30,
2015
December 31,
2014
Liquidity management
assets (1) (2) (7)
$3,245,393 $3,140,782 $2,972,220 $18,621 $18,165 $15,563 2.28% 2.29% 2.08%
Other earning assets (2) (3) (7)29,792 30,990 29,699 244 234 255 3.26 3.00 3.40
Loans, net of unearned income (2) (4) (7)16,889,922 16,509,001 14,469,745 168,060 165,572 153,590 3.95 3.98 4.21
Covered loans154,846 174,768 244,139 1,871 2,605 4,187 4.79 5.91 6.80
Total earning assets (7)$20,319,953 $19,855,541 $17,715,803 $188,796 $186,576 $173,595 3.69% 3.73% 3.89%
Allowance for loan and covered loan losses(109,448) (106,091) (97,506)
Cash and due from banks260,593 251,289 243,080
Other assets1,762,394 1,687,711 1,505,293
Total assets$22,233,492 $21,688,450 $19,366,670
Interest-bearing deposits$13,606,046 $13,489,651 $12,771,359 $12,617 $12,436 $12,431 0.37% 0.37% 0.39%
Federal Home Loan Bank advances448,725 402,646 335,198 2,684 2,458 2,534 2.37 2.42 3.00
Other borrowings269,914 272,782 84,795 1,007 1,045 313 1.48 1.52 1.47
Subordinated notes140,000 140,000 140,000 1,777 1,776 1,776 5.08 5.08 5.07
Junior subordinated debentures268,566 264,974 249,493 2,196 2,124 1,942 3.20 3.14 3.04
Total interest-bearing liabilities$14,733,251 $14,570,053 $13,580,845 $20,281 $19,839 $18,996 0.55% 0.54% 0.55%
Non-interest bearing deposits4,776,977 4,473,632 3,398,774
Other liabilities375,719 334,254 329,196
Equity2,347,545 2,310,511 2,057,855
Total liabilities and shareholders’ equity$22,233,492 $21,688,450 $19,366,670
Interest rate spread (5) (7) 3.14% 3.19% 3.34%
Net free funds/contribution(6)$5,586,702 $5,285,488 $4,134,958 0.15% 0.14% 0.12%
Net interest income/margin (7) $168,515 $166,737 $154,599 3.29% 3.33% 3.46%

(1) Liquidity management assets include available-for-sale and held-to-maturity securities, interest earning deposits with banks, federal funds sold and securities purchased under resale agreements.
(2) Interest income on tax-advantaged loans, trading securities and securities reflects a tax-equivalent adjustment based on a marginal federal corporate tax rate of 35%. The total adjustments for the three months ended December 31, 2015, September 30, 2015 and December 31, 2014 were $1.3 million, $1.2 million and $880,000, respectively.
(3) Other earning assets include brokerage customer receivables and trading account securities.
(4) Loans, net of unearned income, include loans held-for-sale and non-accrual loans.
(5) Interest rate spread is the difference between the yield earned on earning assets and the rate paid on interest-bearing liabilities.
(6) Net free funds are the difference between total average earning assets and total average interest-bearing liabilities. The estimated contribution to net interest margin from net free funds is calculated using the rate paid for total interest-bearing liabilities.
(7) See “Supplemental Financial Measures/Ratios” for additional information on this performance ratio.

The following table presents a summary of Wintrust’s average balances, net interest income and related net interest margins, calculated on a fully tax-equivalent basis, for the year ended December 31, 2015 compared to the year ended December 31, 2014:

Average Balance for Year Ended, Interest for Year Ended, Yield/Rate for Year Ended,
(Dollars in thousands)December 31, 2015 December 31, 2014 December 31, 2015 December 31, 2014 December 31, 2015 December 31, 2014
Liquidity management assets (1) (2) (7)$2,992,506 $2,761,450 $68,949 $59,368 2.30% 2.15%
Other earning assets (2) (3) (7)30,161 28,699 962 916 3.19 3.19
Loans, net of unearned income (2) (4) (7)16,022,371 13,958,842 641,917 590,620 4.01 4.23
Covered loans186,427 280,946 11,345 23,532 6.09 8.38
Total earning assets (7)$19,231,465 $17,029,937 $723,173 $674,436 3.76% 3.96%
Allowance for loan and covered loan losses(103,459) (100,586)
Cash and due from banks249,488 234,194
Other assets1,632,279 1,535,913
Total assets$21,009,773 $18,699,458
Interest-bearing deposits$13,271,304 $12,470,597 $48,863 $48,411 0.37% 0.39%
Federal Home Loan Bank advances389,426 387,591 9,110 10,523 2.34 2.71
Other borrowings233,152 132,479 3,627 1,773 1.56 1.34
Subordinated notes140,000 77,479 7,105 3,906 5.07 5.04
Junior subordinated debentures258,203 249,493 8,230 8,079 3.14 3.19
Total interest-bearing liabilities$14,292,085 $13,317,639 $76,935 $72,692 0.54% 0.55%
Non-interest bearing deposits4,144,378 3,062,338
Other liabilities340,321 325,522
Equity2,232,989 1,993,959
Total liabilities and shareholders’ equity$21,009,773 $18,699,458
Interest rate spread (5) (7) 3.22% 3.41%
Net free funds/contribution (6)$4,939,380 $3,712,298 0.14% 0.12%
Net interest income/margin (7) $646,238 $601,744 3.36% 3.53%

(1) Liquidity management assets include available-for-sale and held-to-maturity securities, interest earning deposits with banks, federal funds sold and securities purchased under resale agreements.
(2) Interest income on tax-advantaged loans, trading securities and securities reflects a tax-equivalent adjustment based on a marginal federal corporate tax rate of 35%. The total adjustments for the years ended December 31, 2015 and 2014 were $4.7 million and $3.2 million, respectively.
(3) Other earning assets include brokerage customer receivables and trading account securities.
(4) Loans, net of unearned income, include loans held-for-sale and non-accrual loans.
(5) Interest rate spread is the difference between the yield earned on earning assets and the rate paid on interest-bearing liabilities.
(6) Net free funds are the difference between total average earning assets and total average interest-bearing liabilities. The estimated contribution to net interest margin from net free funds is calculated using the rate paid for total interest-bearing liabilities.
(7) See “Supplemental Financial Measures/Ratios” for additional information on this performance ratio.

Interest Rate Sensitivity

As an ongoing part of its financial strategy, the Company attempts to manage the impact of fluctuations in market interest rates on net interest income. Management measures its exposure to changes in interest rates modeling many different interest rate scenarios.

The following interest rate scenarios display the percentage change in net interest income over a one-year time horizon assuming increases of 100 and 200 basis points and a decrease of 100 basis points. The Static Shock Scenario results incorporate actual cash flows and repricing characteristics for balance sheet instruments following an instantaneous, parallel change in market rates based upon a static (i.e. no growth or constant) balance sheet. Conversely, the Ramp Scenario results incorporate management’s projections of future volume and pricing of each of the product lines following a gradual, parallel change in market rates over twelve months. Actual results may differ from these simulated results due to timing, magnitude, and frequency of interest rate changes as well as changes in market conditions and management strategies. The interest rate sensitivity for both the Static Shock and Ramp Scenarios at December 31, 2015, September 30, 2015 and December 31, 2014 is as follows:

Static Shock Scenarios +200
Basis
Points
+100
Basis
Points
-100
Basis
Points
December 31, 2015 16.1% 8.7% (10.6)%
September 30, 2015 15.6% 8.0% (11.1)%
December 31, 2014 13.4% 6.4% (10.1)%


Ramp Scenarios+200
Basis
Points
+100
Basis
Points
-100
Basis
Points
December 31, 2015 7.3% 3.9% (4.4)%
September 30, 20156.7% 3.6% (4.0)%
December 31, 20145.4% 2.5% (3.9)%

These results indicate that the Company has positioned its balance sheet to benefit from a rise in interest rates. This analysis also indicates that the Company would benefit to a greater magnitude should a rise in interest rates be significant (i.e. 200 basis points) and immediate (Static Shock Scenario).

NON-INTEREST INCOME

The following table presents non-interest income by category for the periods presented:

Three Months Ended
December 31, September 30, December 31, Q4 2015 compared to
Q3 2015
Q4 2015 compared to
Q4 2014
(Dollars in thousands) 2015 2015 2014 $ Change % Change $ Change % Change
Brokerage $6,850 $6,579 $7,892 $271 4% $(1,042) (13)%
Trust and asset management 11,784 11,664 10,757 120 1 1,027 10
Total wealth management 18,634 18,243 18,649 391 2 (15) 0
Mortgage banking 23,317 27,887 24,694 (4,570) (16) (1,377) (6)
Service charges on deposit accounts 7,210 7,403 6,189 (193) (3) 1,021 16
(Losses) gains on available-for-sale securities, net (79) (98) 18 19 NM (97) NM
Fees from covered call options 3,629 2,810 2,966 819 29 663 22
Trading gains (losses), net 205 (135) (507) 340 NM 712 NM
Operating lease income, net 1,973 613 67 1,360 NM 1,906 NM
Other:
Interest rate swap fees 2,343 2,606 1,119 (263) (10) 1,224 NM
BOLI 1,463 212 661 1,251 NM 802 NM
Administrative services 1,101 1,072 1,107 29 3 (6) (1)
Miscellaneous 5,294 4,340 2,694 954 22 2,600 97
Total Other 10,201 8,230 5,581 1,971 24 4,620 83
Total Non-Interest Income $65,090 $64,953 $57,657 $137 0% $7,433 13%


Years Ended December 31, $ %
(Dollars in thousands) 2015 2014 Change Change
Brokerage $27,030 $30,438 $(3,408) (11)%
Trust and asset management 46,422 40,905 5,517 13
Total wealth management 73,452 71,343 2,109 3
Mortgage banking 115,011 91,617 23,394 26
Service charges on deposit accounts 27,384 23,307 4,077 17
Gains (losses) on available-for-sale securities, net 323 (504) 827 NM
Fees from covered call options 15,364 7,859 7,505 95
Trading (losses) gains, net (247) (1,609) 1,362 NM
Operating lease income, net 2,728 163 2,565 NM
Other:
Interest rate swap fees 9,487 4,469 5,018 NM
BOLI 4,622 2,700 1,922 71
Administrative services 4,252 3,893 359 9
Miscellaneous 19,221 12,002 7,219 60
Total Other 37,582 23,064 14,518 63
Total Non-Interest Income $271,597 $215,240 $56,357 26%
NM - Not Meaningful

The significant changes in non-interest income for the quarter ended December 31, 2015 compared to the quarters ended September 30, 2015 and December 31, 2014 are discussed below.

Wealth management revenue totaled $18.6 million in the fourth quarter of 2015 as compared to $18.2 million in the third quarter of 2015 and $18.6 million in the fourth quarter of 2014. The increase as compared to the third quarter of 2015 is mostly attributable to growth in assets from new customers and new financial advisors, as well as an increase in existing customer activity and market appreciation. Wealth management revenue is comprised of the trust and asset management revenue of The Chicago Trust Company and Great Lakes Advisors and the brokerage commissions, money managed fees and insurance product commissions at Wayne Hummer Investments.

For the quarter ended December 31, 2015, mortgage banking revenue totaled $23.3 million, a decrease of $4.6 million as compared to the third quarter of 2015 and a decrease of $1.4 million when compared to the fourth quarter of 2014. The decrease in mortgage banking revenue in the fourth quarter of 2015, when compared to the third quarter of 2015 and the fourth quarter of 2014, resulted primarily from lower origination volumes in the current quarter. Mortgage loans originated or purchased for sale were $808.9 million in the current quarter as compared to $973.7 million in the third quarter of 2015 and $838.3 million in the prior year quarter. Mortgage banking revenue includes revenue from activities related to originating, selling and servicing residential real estate loans for the secondary market.

Service charges on deposit accounts totaled $7.2 million in the fourth quarter of 2015, a slight decrease compared to the third quarter of 2015 and an increase of $1.0 million compared to the prior year quarter. The increase in the current quarter as compared to the fourth quarter of 2014 is primarily a result of higher account analysis fees on deposit accounts which have increased as a result of the Company's commercial banking initiative as well as additional service charges on deposit accounts from acquired institutions.

Fees from covered call option transactions totaled $3.6 million for the fourth quarter 2015, compared to $2.8 million for the third quarter of 2015 and $3.0 million for the fourth quarter of 2014. The Company has typically written call options with terms of less than three months against certain U.S. Treasury and agency securities held in its portfolio for liquidity and other purposes. Management has effectively entered into these transactions with the goal of economically hedging security positions and enhancing its overall return on its investment portfolio by using fees generated from these options to compensate for net interest margin compression. These option transactions are designed to increase the total return associated with holding certain investment securities and do not qualify as hedges pursuant to accounting guidance. Fees from covered call options increased in the current quarter compared to prior year periods primarily as a result of selling call options against a larger value of underlying securities resulting in higher premiums received by the Company. There were no outstanding call option contracts at December 31, 2015, September 30, 2015 and December 31, 2014.

The Company recognized $205,000 of trading gains in the fourth quarter of 2015 compared to trading losses of $135,000 in the third quarter of 2015 and trading losses of $507,000 in the fourth quarter of 2014. Trading gains and losses recorded by the Company primarily result from fair value adjustments related to interest rate derivatives not designated as hedges, primarily interest rate cap instruments that the Company uses to manage interest rate risk, specifically in the event of future increases in short-term interest rates. The change in value of the cap derivatives reflects the present value of expected cash flows over the remaining life of the caps. These expected cash flows are derived from the expected path for and a measure of volatility for short-term interest rates.

Other non-interest income totaled $10.2 million for the quarter ended December 31, 2015, an increase of $2.0 million compared to the third quarter of 2015 and an increase of $4.6 million compared to the fourth quarter of 2014. The increase in the current quarter as compared to the third quarter of 2015 and the fourth quarter of 2014, is primarily due to an increase in net gains on partnership investments, greater interest rate swap revenues resulting from interest rate hedging transactions related to both customer-based trades and the related matched trades with inter-bank counterparties and the recognition of a $0.6 million BOLI death benefit.

NON-INTEREST EXPENSE

The following table presents non-interest expense by category for the periods presented:

Three Months Ended
December 31, September 30, December 31, Q4 2015 compared to
Q3 2015
Q4 2015 compared to
Q4 2014
(Dollars in thousands) 2015 2015 2014 $ Change % Change $ Change % Change
Salaries and employee benefits:
Salaries $50,982 $53,028 $45,255 $(2,046) (4)% $5,727 13%
Commissions and incentive compensation 31,222 30,035 28,369 1,187 4 2,853 10
Benefits 17,576 14,686 14,009 2,890 20 3,567 25
Total salaries and employee benefits 99,780 97,749 87,633 2,031 2 12,147 14
Equipment 8,772 8,414 7,502 358 4 1,270 17
Equipment on operating lease 1,229 473 53 756 NM 1,176 NM
Occupancy, net 13,062 12,066 11,600 996 8 1,462 13
Data processing 7,284 8,127 5,313 (843) (10) 1,971 37
Advertising and marketing 5,373 6,237 3,669 (864) (14) 1,704 46
Professional fees 4,387 4,100 4,039 287 7 348 9
Amortization of other intangible assets 1,324 1,350 1,171 (26) (2) 153 13
FDIC insurance 3,317 3,035 2,810 282 9 507 18
OREO expense, net 2,598 (367) 2,320 2,965 NM 278 12
Other:
Commissions - 3rd party brokers 1,321 1,364 1,470 (43) (3) (149) (10)
Postage 1,892 1,927 1,724 (35) (2) 168 10
Miscellaneous 16,490 15,499 14,137 991 6 2,353 17
Total other 19,703 18,790 17,331 913 5 2,372 14
Total Non-Interest Expense $166,829 $159,974 $143,441 $6,855 4% $23,388 16%


Years Ended December 31, $
Change
%
Change
(Dollars in thousands) 2015 2014
Salaries and employee benefits:
Salaries $197,475 $177,811 19,664 11%
Commissions and incentive compensation 120,138 103,185 16,953 16
Benefits 64,467 54,510 9,957 18
Total salaries and employee benefits 382,080 335,506 46,574 14
Equipment 32,812 29,609 3,203 11
Equipment on operating lease 1,826 142 1,684 NM
Occupancy, net 48,880 42,889 5,991 14
Data processing 26,940 19,336 7,604 39
Advertising and marketing 21,924 13,571 8,353 62
Professional fees 18,225 15,574 2,651 17
Amortization of other intangible assets 4,621 4,692 (71) (2)
FDIC insurance 12,386 12,168 218 2
OREO expenses, net 4,483 9,367 (4,884) (52)
Other:
Commissions - 3rd party brokers 5,474 6,381 (907) (14)
Postage 7,030 6,045 985 16
Miscellaneous 61,738 51,567 10,171 20
Total other 74,242 63,993 10,249 16
Total Non-Interest Expense $628,419 $546,847 $81,572 15%

The significant changes in non-interest expense for the quarter ended December 31, 2015 compared to the quarters ended September 30, 2015 and December 31, 2014 are discussed below.

Salaries and employee benefits expense increased $12.1 million, or 14%, in the fourth quarter of 2015 compared to the fourth quarter of 2014 , and increased $2.0 million compared to the third quarter of 2015. The increase compared to the prior year period is primarily due to a $5.7 million increase in salaries caused by the addition of employees from acquisitions, increased staffing as the Company grows, acquisition-related and severance charges, along with a $2.8 million increase in commissions and incentive compensation and a $3.6 million increase in employee benefits resulting from higher insurance costs and the $1.4 million adjustment of pension obligations assumed in previous acquisitions.

Equipment on operating lease expense totaled $1.2 million for the fourth quarter of 2015, an increase of $756,000 compared to the third quarter of 2015 and an increase of $1.2 million compared to the fourth quarter of 2014. The increase in the current quarter compared to the prior periods is primarily related to growth in business from the Company's leasing divisions.

Occupancy expense for the fourth quarter of 2015 was $13.1 million, an increase of $1.0 million, or 8% compared to the third quarter of 2015 and an increase of $1.5 million, or 13%, compared to the same period in 2014. The increase in the current quarter as compared to the prior year quarter is primarily the result of increased rent expense on leased properties as well as additional depreciation expenses on owned locations including those obtained in the Company's acquisitions. Occupancy expense includes depreciation on premises, real estate taxes, utilities and maintenance of premises, as well as net rent expense for leased premises.

Data processing expenses decreased in the fourth quarter of 2015 totaling $7.3 million as compared to $8.1 million in the third quarter of 2015 and increased $2.0 million compared to the fourth quarter of 2014. The amount of data processing expenses incurred decreased compared to third quarter of 2015 primarily due to lower acquisition related expenses recorded in the fourth quarter of 2015 than were recorded in the third quarter related to recent bank acquisition transactions.

OREO expense totaled $2.6 million in the fourth quarter of 2015, an increase of $3.0 million compared to the third quarter of 2015 and an increase of $278,000 compared to the fourth quarter of 2014. The increase in total OREO expense in the current quarter is due to operating expenses (net of rental income) increasing $716,000, recognized gains on sales decreasing $1.1 million and OREO valuation write-downs increasing $1.1 million. OREO costs include all costs related to obtaining, maintaining and selling other real estate owned properties.

Miscellaneous expenses in the fourth quarter of 2015 increased $1.0 million as compared to the third quarter of 2015 and increased $2.4 million, or 17%, compared to the quarter ended December 31, 2014. Miscellaneous expense includes ATM expenses, correspondent bank charges, directors' fees, telephone, travel and entertainment, corporate insurance, operating losses, dues and subscriptions, problem loan expenses and lending origination costs that are not deferred.

ASSET QUALITY
Allowance for Credit Losses, excluding covered loans
Three Months Ended Years Ended
(Dollars in thousands) December 31, 2015 September 30, 2015 December 31, 2014 December 31, 2015 December 31, 2014
Allowance for loan losses at beginning of period $102,996 $100,204 $91,019 $91,705 $96,922
Provision for credit losses 9,196 8,665 6,744 33,747 22,889
Other adjustments (243) (153) (236) (737) (824)
Reclassification from/(to) allowance for unfunded lending-related commitments 13 (42) 46 (138) (56)
Charge-offs:
Commercial 1,369 964 289 4,253 4,153
Commercial real estate 2,734 1,948 4,434 6,543 15,788
Home equity 680 1,116 150 4,227 3,895
Residential real estate 211 1,138 630 2,903 1,750
Premium finance receivables - commercial 2,676 1,595 1,463 7,060 5,722
Premium finance receivables - life insurance 4 4
Consumer and other 179 116 156 521 792
Total charge-offs 7,849 6,877 7,126 25,507 32,104
Recoveries:
Commercial 315 462 315 1,432 1,198
Commercial real estate 491 213 572 2,840 1,334
Home equity 183 42 57 312 535
Residential real estate 55 136 19 283 335
Premium finance receivables - commercial 223 278 219 1,288 1,139
Premium finance receivables - life insurance 16 6 16 11
Consumer and other 20 52 70 159 326
Total recoveries 1,287 1,199 1,258 6,330 4,878
Net charge-offs (6,562) (5,678) (5,868) (19,177) (27,226)
Allowance for loan losses at period end $105,400 $102,996 $91,705 $105,400 $91,705
Allowance for unfunded lending-related commitments at period end 949 926 775 949 775
Allowance for credit losses at period end $106,349 $103,922 $92,480 $106,349 $92,480
Annualized net charge-offs by category as a percentage of its own respective category’s average:
Commercial 0.09% 0.05% % 0.07% 0.08%
Commercial real estate 0.16 0.13 0.34 0.07 0.33
Home equity 0.25 0.55 0.05 0.52 0.47
Residential real estate 0.07 0.42 0.30 0.29 0.19
Premium finance receivables - commercial 0.41 0.21 0.21 0.24 0.19
Premium finance receivables - life insurance
Consumer and other 0.37 0.17 0.19 0.23 0.28
Total loans, net of unearned income, excluding covered loans 0.15% 0.14% 0.16% 0.12% 0.20%
Net charge-offs as a percentage of the provision for credit losses 71.35% 65.53% 86.98% 56.83% 118.94%
Loans at period-end $17,118,117 $16,316,211 $14,409,398
Allowance for loan losses as a percentage of loans at period end 0.62% 0.63% 0.64%
Allowance for credit losses as a percentage of loans at period end 0.62% 0.64% 0.64%

The allowance for credit losses, excluding the allowance for covered loan losses, is comprised of the allowance for loan losses and the allowance for unfunded lending-related commitments. The allowance for loan losses is a reserve against loan amounts that are actually funded and outstanding while the allowance for unfunded lending-related commitments (separate liability account) relates to certain amounts that Wintrust is committed to lend but for which funds have not yet been disbursed. The provision for credit losses, excluding the provision for covered loan losses, may contain both a component related to funded loans (provision for loan losses) and a component related to lending-related commitments (provision for unfunded loan commitments and letters of credit).

Net charge-offs as a percentage of loans, excluding covered loans, for the fourth quarter of 2015 totaled 15 basis points on an annualized basis compared to 14 basis points on an annualized basis in the third quarter of 2015 and 16 basis points on an annualized basis in the fourth quarter of 2014. Net charge-offs totaled $6.6 million in the fourth quarter of 2015, an $884,000 increase from $5.7 million in the third quarter of 2015 and a $694,000 increase from $5.9 million in the fourth quarter of 2014.

The provision for credit losses, excluding the provision for covered loan losses, totaled $9.2 million for the fourth quarter of 2015, as compared to $8.7 million for the third quarter of 2015 and $6.7 million for the fourth quarter of 2014. The higher provision for credit losses in the fourth quarter of 2015 compared to the same period of 2014 was partly due to the loan growth in the current period.

The allowance for unfunded lending-related commitments totaled $949,000 as of December 31, 2015 compared to $926,000 as of September 30, 2015 and $775,000 as of December 31, 2014.

Management believes the allowance for credit losses is appropriate to provide for inherent losses in the portfolio. There can be no assurances however, that future losses will not exceed the amounts provided for, thereby affecting future results of operations. The amount of future additions to the allowance for credit losses will be dependent upon management’s assessment of the appropriateness of the allowance based on its evaluation of economic conditions, changes in real estate values, interest rates, the regulatory environment, the level of past-due and non-performing loans, and other factors.

The Company also provides a provision for covered loan losses on covered loans and maintains an allowance for covered loan losses on covered loans. Please see “Covered Assets” later in this document for more detail.

The following table presents the provision for credit losses and allowance for credit losses by component for the periods presented:

Three Months Ended Years Ended
(Dollars in thousands) December 31, 2015 September 30, 2015 December 31, 2014 December 31, 2015 December 31, 2014
Provision for loan losses $9,209 $8,623 $6,790 $33,609 $22,833
Provision for unfunded lending-related commitments (13) 42 (46) 138 56
Provision for covered loan losses (137) (343) (611) (805) (2,352)
Provision for credit losses $9,059 $8,322 $6,133 $32,942 $20,537
Period End
December 31, 2015 September 30, 2015 December 31, 2014
Allowance for loan losses $105,400 $102,996 $91,705
Allowance for unfunded lending-related commitments 949 926 775
Allowance for covered loan losses 3,026 2,918 2,131
Allowance for credit losses $109,375 $106,840 $94,611

The tables below summarize the calculation of allowance for loan losses for the Company’s core loan portfolio and consumer, niche and purchased loan portfolio as of December 31, 2015 and September 30, 2015.

As of December 31, 2015
Recorded Calculated As a percentage
of its own respective
(Dollars in thousands) Investment Allowance category’s balance
Commercial: (1)
Commercial and industrial $2,793,794 $23,455 0.84%
Asset-based lending 740,234 5,859 0.79
Tax exempt 265,264 1,759 0.66
Leases 225,805 232 0.10
Other 2,790 20 0.73
Commercial real estate: (1)
Residential construction 69,407 895 1.29
Commercial construction 286,777 3,018 1.05
Land 72,114 2,467 3.42
Office 802,274 5,890 0.73
Industrial 679,538 6,373 0.94
Retail 794,442 5,597 0.70
Multi-family 685,217 7,348 1.07
Mixed use and other 1,581,024 11,809 0.75
Home equity (1) 688,160 11,993 1.74
Residential real estate (1) 559,532 4,726 0.84
Total core loan portfolio $10,246,372 $91,441 0.89%
Commercial:
Franchise $245,228 $3,086 1.26%
Mortgage warehouse lines of credit 222,806 1,628 0.73
Community Advantage - homeowner associations 130,986 3
Aircraft 5,327 7 0.13
Purchased non-covered commercial loans (2) 81,675 86 0.11
Commercial real estate:
Purchased non-covered commercial real estate (2) 558,496 361 0.06��
Purchased non-covered home equity (2) 96,515 19 0.02
Purchased non-covered residential real estate (2) 47,919 8 0.02
Premium finance receivables
U.S. commercial insurance loans 2,096,604 5,449 0.26
Canada commercial insurance loans (2) 278,317 567 0.20
Life insurance loans (1) 2,593,204 1,217 0.05
Purchased life insurance loans (2) 368,292
Consumer and other (1) 141,743 1,527 1.08
Purchased non-covered consumer and other (2) 4,633 1 0.02
Total consumer, niche and purchased loan portfolio $6,871,745 $13,959 0.20%
Total loans, net of unearned income, excluding covered loans $17,118,117 $105,400 0.62%
Non-accretable credit discounts on purchased loans reported in accordance with ASC 310-30, excluding covered loans 29,502
Total allowance for loan losses and non-accretable credit discounts on purchased loans, excluding covered loans $134,902 0.79%

(1) Excludes purchased loans reported in accordance with ASC 310-20 and ASC 310-30.
(2) Purchased loans represent loans reported in accordance with ASC 310-20 and ASC 310-30.

As of September 30, 2015
Recorded Calculated As a percentage
of its own respective
(Dollars in thousands) Investment Allowance category’s balance
Commercial: (1)
Commercial and industrial $2,579,208 $21,875 0.85%
Asset-based lending 797,301 6,282 0.79
Tax exempt 230,878 1,303 0.56
Leases 205,612 169 0.08
Other 1,953 12 0.61
Commercial real estate: (1)
Residential construction 60,072 753 1.25
Commercial construction 283,689 2,995 1.06
Land 73,923 2,550 3.45
Office 762,734 7,154 0.94
Industrial 614,619 5,515 0.90
Retail 753,009 5,254 0.70
Multi-family 650,287 6,951 1.07
Mixed use and other 1,517,265 12,077 0.80
Home equity (1) 694,203 12,205 1.76
Residential real estate (1) 518,756 4,580 0.88
Total core loan portfolio $9,743,509 $89,675 0.92%
Commercial:
Franchise $222,001 $3,145 1.42%
Mortgage warehouse lines of credit 136,614 1,022 0.75
Community Advantage - homeowner associations 123,209 3
Aircraft 6,371 8 0.13
Purchased non-covered commercial loans (2) 97,038 171 0.18
Commercial real estate:
Purchased non-covered commercial real estate (2) 591,968 812 0.14
Purchased non-covered home equity (2) 103,262 18 0.02
Purchased non-covered residential real-estate (2) 52,987 6 0.01
Premium finance receivables
U.S. commercial insurance loans 2,127,969 5,458 0.26
Canada commercial insurance loans (2) 279,106 583 0.21
Life insurance loans (1) 2,326,689 1,040 0.04
Purchased life insurance loans (2) 373,586
Consumer and other (1) 127,011 1,054 0.83
Purchased non-covered consumer and other (2) 4,891 1 0.02
Total consumer, niche and purchased loan portfolio $6,572,702 $13,321 0.20%
Total loans, net of unearned income, excluding covered loans $16,316,211 $102,996 0.63%
Non-accretable credit discounts on purchased loans reported in accordance with ASC 310-30, excluding covered loans 30,405
Total allowance for loan losses and non-accretable credit discounts on purchased loans, excluding covered loans $133,401 0.82%

(1) Excludes purchased loans reported in accordance with ASC 310-20 and ASC 310-30.
(2) Purchased loans represent loans reported in accordance with ASC 310-20 and ASC 310-30.

As part of the regular quarterly review performed by management to determine if the Company’s allowance for loan losses is appropriate, an analysis is prepared on the loan portfolio based upon a breakout of core loans and consumer, niche and purchased loans. A summary of the allowance for loan losses calculated for the loan components in both the core loan portfolio and the consumer, niche and purchased loan portfolio was shown on the previous pages as of December 31, 2015 and September 30, 2015.

The decrease in the allowance for loan losses to core loans in the fourth quarter of 2015 compared to the third quarter of 2015 was attributable to a smaller population of core loans requiring ASC 310 reserves (specific reserves). Loans requiring ASC 450 reserves typically have lower reserve factors as compared to core loans requiring ASC 310 reserves. ASC 310 reserves are maintained on impaired loans.

Purchased loans acquired in a business combination are recorded at estimated fair value on their purchase date. In accordance with accounting guidance, credit deterioration on purchased loans is recorded as a credit discount at the time of purchase instead of as an increase to the allowance for loan losses. For analysis purposes, the Company has combined the non-accretable credit discounts recorded on purchased loans with the total allowance for loan losses in the previous tables to present the total credit reserves available on its loan portfolio. The total allowance for loan losses and non-accretable credit discounts on purchased loans was 0.79% of the total loan portfolio as of December 31, 2015 as compared to 0.82% as of September 30, 2015. The Company expects the total allowance for loan losses and non-accretable credit discounts on purchased loans to total loans ratio to increase in periods that have acquisitions and decrease in periods without acquisitions, based on the performance of the purchased loan portfolios.

The table below shows the aging of the Company’s loan portfolio at December 31, 2015:

90+ days 60-89 30-59
As of December 31, 2015 and still days past days past
(Dollars in thousands) Nonaccrual accruing due due Current Total Loans
Loan Balances:
Commercial
Commercial and industrial $12,416 $6 $6,749 $33,680 $2,798,503 $2,851,354
Franchise 245,228 245,228
Mortgage warehouse lines of credit 222,806 222,806
Community Advantage - homeowners association 130,986 130,986
Aircraft 288 5,039 5,327
Asset-based lending 8 3,864 1,844 736,968 742,684
Tax exempt 267,273 267,273
Leases 535 748 4,192 220,599 226,074
Other 3,588 3,588
PCI - commercial (1) 892 2,510 15,187 18,589
Total commercial 12,712 1,433 11,361 42,226 4,646,177 4,713,909
Commercial real estate
Residential construction 273 45 70,063 70,381
Commercial construction 33 1,371 1,600 285,275 288,279
Land 1,751 120 76,546 78,417
Office 4,619 764 3,817 853,801 863,001
Industrial 9,564 1,868 1,009 715,207 727,648
Retail 1,760 442 2,310 863,887 868,399
Multi-family 1,954 597 6,568 733,230 742,349
Mixed use and other 6,691 6,723 18,835 1,700,567 1,732,816
PCI - commercial real estate (1) 22,111 4,662 16,559 114,667 157,999
Total commercial real estate 26,645 22,111 16,427 50,863 5,413,243 5,529,289
Home equity 6,848 1,889 5,517 770,421 784,675
Residential real estate 12,043 1,964 3,824 586,154 603,985
PCI - residential real estate (1) 488 202 79 2,697 3,466
Premium finance receivables
Commercial insurance loans 14,561 10,294 6,624 21,656 2,321,786 2,374,921
Life insurance loans 3,432 11,140 2,578,632 2,593,204
PCI - life insurance loans (1) 368,292 368,292
Consumer and other, including PCI 263 211 204 1,187 144,511 146,376
Total loans, net of unearned income, excluding covered loans $73,072 $34,537 $42,103 $136,492 $16,831,913 $17,118,117
Covered loans 5,878 7,335 703 5,774 128,983 148,673
Total loans, net of unearned income $78,950 $41,872 $42,806 $142,266 $16,960,896 $17,266,790

(1) PCI loans represent loans acquired with evidence of credit quality deterioration since origination, in accordance with ASC 310-30. Loan agings are based upon contractually required payments.

Aging as a % of Loan Balance: Nonaccrual 90+ days
and still
accruing
60-89
days past
due
30-59
days past
due
Current Total Loans
Commercial
Commercial and industrial 0.4% % 0.2% 1.2% 98.2% 100.0%
Franchise 100.0 100.0
Mortgage warehouse lines of credit 100.0 100.0
Community Advantage - homeowners association 100.0 100.0
Aircraft 5.4 94.6 100.0
Asset-based lending 0.5 0.3 99.2 100.0
Tax exempt 100.0 100.0
Leases 0.2 0.3 1.9 97.6 100.0
Other 100.0 100.0
PCI - commercial (1) 4.8 13.5 81.7 100.0
Total commercial 0.3 0.2 0.9 98.6 100.0
Commercial real estate
Residential construction 0.4 0.1 99.5 100.0
Commercial construction 0.5 0.6 98.9 100.0
Land 2.2 0.2 97.6 100.0
Office 0.5 0.1 0.4 99.0 100.0
Industrial 1.3 0.3 0.1 98.3 100.0
Retail 0.2 0.1 0.3 99.4 100.0
Multi-family 0.3 0.1 0.9 98.7 100.0
Mixed use and other 0.4 0.4 1.1 98.1 100.0
PCI - commercial real estate (1) 14.0 3.0 10.5 72.5 100.0
Total commercial real estate 0.5 0.4 0.3 0.9 97.9 100.0
Home equity 0.9 0.2 0.7 98.2 100.0
Residential real estate 2.0 0.3 0.6 97.1 100.0
PCI - residential real estate(1) 14.1 5.8 2.3 77.8 100.0
Premium finance receivables
Commercial insurance loans 0.6 0.4 0.3 0.9 97.8 100.0
Life insurance loans 0.1 0.4 99.5 100.0
PCI - life insurance loans (1) 100.0 100.0
Consumer and other, including PCI 0.2 0.1 0.1 0.8 98.8 100.0
Total loans, net of unearned income, excluding covered loans 0.4% 0.2% 0.2% 0.8% 98.4% 100.0%
Covered loans 4.0 4.9 0.5 3.9 86.7 100.0
Total loans, net of unearned income 0.5% 0.2% 0.2% 0.8% 98.3% 100.0%

As of December 31, 2015, $42.1 million of all loans, excluding covered loans, or 0.2%, were 60 to 89 days past due and $136.5 million, or 0.8%, were 30 to 59 days (or one payment) past due. As of September 30, 2015, $39.0 million of all loans, excluding covered loans, or 0.2%, were 60 to 89 days past due and $57.4 million, or 0.4%, were 30 to 59 days (or one payment) past due. The majority of the commercial and commercial real estate loans shown as 60 to 89 days and 30 to 59 days past due are included on the Company’s internal problem loan reporting system. Loans on this system are closely monitored by management on a monthly basis.

The Company’s home equity and residential loan portfolios continue to exhibit low delinquency ratios. Home equity loans at December 31, 2015 that are current with regard to the contractual terms of the loan agreement represent 98.2% of the total home equity portfolio. Residential real estate loans at December 31, 2015 that are current with regards to the contractual terms of the loan agreements comprise 96.9% of total residential real estate loans outstanding, which includes purchased non-covered residential real-estate.

The table below shows the aging of the Company’s loan portfolio at September 30, 2015:

90+ days 60-89 30-59
As of September 30, 2015 and still days past days past
(Dollars in thousands) Nonaccrual accruing due due Current Total Loans
Loan Balances:
Commercial
Commercial and industrial $12,006 $ $2,731 $9,331 $2,622,207 $2,646,275
Franchise 80 376 221,545 222,001
Mortgage warehouse lines of credit 136,614 136,614
Community Advantage - homeowners association 44 123,165 123,209
Aircraft 378 5,993 6,371
Asset-based lending 12 1,313 247 800,798 802,370
Tax exempt 232,667 232,667
Leases 89 205,697 205,786
Other 1,953 1,953
PCI - commercial (1) 217 39 22,683 22,939
Total commercial 12,018 217 4,168 10,460 4,373,322 4,400,185
Commercial real estate
Residential construction 1,141 60,130 61,271
Commercial construction 31 2,394 283,538 285,963
Land 1,756 2,207 75,113 79,076
Office 4,045 10,861 2,362 773,043 790,311
Industrial 11,637 786 897 622,804 636,124
Retail 2,022 1,536 821 781,463 785,842
Multi-family 1,525 512 744 684,878 687,659
Mixed use and other 7,601 2,340 12,871 1,797,516 1,820,328
PCI - commercial real estate (1) 13,547 299 583 146,563 160,992
Total commercial real estate 28,617 13,547 16,334 24,020 5,225,048 5,307,566
Home equity 8,365 811 4,124 784,165 797,465
Residential real estate 14,557 1,017 1,195 551,292 568,061
PCI - residential real estate (1) 424 323 411 2,524 3,682
Premium finance receivables
Commercial insurance loans 13,751 8,231 6,664 13,659 2,364,770 2,407,075
Life insurance loans 9,656 2,627 2,314,406 2,326,689
PCI - life insurance loans (1) 373,586 373,586
Consumer and other, including PCI 297 140 56 935 130,474 131,902
Total loans, net of unearned income, excluding covered loans $77,605 $22,559 $39,029 $57,431 $16,119,587 $16,316,211
Covered loans 6,540 7,626 1,392 802 152,249 168,609
Total loans, net of unearned income $84,145 $30,185 $40,421 $58,233 $16,271,836 $16,484,820

(1) PCI loans represent loans acquired with evidence of credit quality deterioration since origination, in accordance with ASC 310-30. Loan agings are based upon contractually required payments.

Aging as a % of Loan Balance: Nonaccrual 90+ days
and still
accruing
60-89
days past
due
30-59
days past
due
Current Total Loans
Commercial
Commercial and industrial 0.5% % 0.1% 0.4% 99.0% 100.0%
Franchise 0.2 99.8 100.0
Mortgage warehouse lines of credit 100.0 100.0
Community Advantage - homeowners association 100.0 100.0
Aircraft 5.9 94.1 100.0
Asset-based lending 0.2 99.8 100.0
Tax exempt 100.0 100.0
Leases 100.0 100.0
Other 100.0 100.0
PCI - commercial(1) 0.9 0.2 98.9 100.0
Total commercial 0.3 0.1 0.2 99.4 100.0
Commercial real estate
Residential construction 1.9 98.1 100.0
Commercial construction 0.8 99.2 100.0
Land 2.2 2.8 95.0 100.0
Office 0.5 1.4 0.3 97.8 100.0
Industrial 1.8 0.1 0.1 98.0 100.0
Retail 0.3 0.2 0.1 99.4 100.0
Multi-family 0.2 0.1 0.1 99.6 100.0
Mixed use and other 0.4 0.1 0.7 98.8 100.0
PCI - commercial real estate (1) 8.4 0.2 0.4 91.0 100.0
Total commercial real estate 0.5 0.3 0.3 0.5 98.4 100.0
Home equity 1.0 0.1 0.5 98.4 100.0
Residential real estate 2.6 0.2 0.2 97.0 100.0
PCI - residential real estate (1) 11.5 8.8 11.2 68.5 100.0
Premium finance receivables
Commercial insurance loans 0.6 0.4 0.3 0.6 98.1 100.0
Life insurance loans 0.4 0.1 99.5 100.0
PCI - life insurance loans (1) 100.0 100.0
Consumer and other, including PCI 0.2 0.1 0.7 99.0 100.0
Total loans, net of unearned income, excluding covered loans 0.5% 0.1% 0.2% 0.4% 98.8% 100.0%
Covered loans 3.9 4.5 0.8 0.5 90.3 100.0
Total loans, net of unearned income 0.5% 0.2% 0.2% 0.4% 98.7% 100.0%

Non-performing Assets, excluding covered assets

The following table sets forth Wintrust’s non-performing assets and troubled debt restructurings ("TDRs") performing under the contractual terms of the loan agreement, excluding covered assets and non-covered PCI loans, at the dates indicated.

December 31, September 30, December 31,
(Dollars in thousands) 2015 2015 2014
Loans past due greater than 90 days and still accruing (1):
Commercial $541 $ $474
Commercial real estate
Home equity
Residential real estate
Premium finance receivables - commercial 10,294 8,231 7,665
Premium finance receivables - life insurance
Consumer and other 150 140 119
Total loans past due greater than 90 days and still accruing 10,985 8,371 8,258
Non-accrual loans (2):
Commercial 12,712 12,018 9,157
Commercial real estate 26,645 28,617 26,605
Home equity 6,848 8,365 6,174
Residential real estate 12,043 14,557 15,502
Premium finance receivables - commercial 14,561 13,751 12,705
Premium finance receivables - life insurance
Consumer and other 263 297 277
Total non-accrual loans 73,072 77,605 70,420
Total non-performing loans:
Commercial 13,253 12,018 9,631
Commercial real estate 26,645 28,617 26,605
Home equity 6,848 8,365 6,174
Residential real estate 12,043 14,557 15,502
Premium finance receivables - commercial 24,855 21,982 20,370
Premium finance receivables - life insurance
Consumer and other 413 437 395
Total non-performing loans $84,057 $85,976 $78,677
Other real estate owned 26,849 29,053 36,419
Other real estate owned - from acquisition 17,096 22,827 9,223
Other repossessed assets $174 $193 $303
Total non-performing assets $128,176 $138,049 $124,622
TDRs performing under the contractual terms of the loan agreement $42,744 $49,173 $69,697
Total non-performing loans by category as a percent of its own respective category’s period-end balance:
Commercial 0.28% 0.27% 0.25%
Commercial real estate 0.48 0.54 0.59
Home equity 0.87 1.05 0.86
Residential real estate 1.98 2.55 3.21
Premium finance receivables - commercial 1.05 0.91 0.87
Premium finance receivables - life insurance
Consumer and other 0.28 0.33 0.26
Total loans, net of unearned income 0.49% 0.53% 0.55%
Total non-performing assets as a percentage of total assets 0.56% 0.63% 0.62%
Allowance for loan losses as a percentage of total non-performing loans 125.39% 119.79% 116.56%

(1) As of the dates shown, no TDRs were past due greater than 90 days and still accruing interest.
(2) Non-accrual loans included TDRs totaling $9.1 million, $10.1 million and $12.6 million as of December 31, 2015, September 30, 2015 and December 31, 2014, respectively.

Non-performing Commercial and Commercial Real Estate

Non-performing commercial and commercial real estate totaled $39.9 million as of December 31, 2015 compared to $40.6 million as of September 30, 2015 and $36.2 million as of December 31, 2014.

Management is pursuing the resolution of all credits in this category. At this time, management believes reserves are appropriate to absorb inherent losses that are expected to occur upon the ultimate resolution of these credits.

Non-performing Residential Real Estate and Home Equity

Non-performing home equity and residential real estate loans totaled $18.9 million as of December 31, 2015. The balance decreased $4.0 million from September 30, 2015 and decreased $2.8 million from December 31, 2014. The December 31, 2015 non-performing balance is comprised of $12.0 million of residential real estate (61 individual credits) and $6.8 million of home equity loans (45 individual credits). On average, this is approximately 7 non-performing residential real estate loans and home equity loans per chartered bank within the Company. The Company believes control and collection of these loans is very manageable. At this time, management believes reserves are adequate to absorb inherent losses that may occur upon the ultimate resolution of these credits.

Non-performing Commercial Insurance Premium Finance Receivables

The table below presents the level of non-performing property and casualty premium finance receivables as of December 31, 2015, September 30, 2015 and December 31, 2014 and the amount of net charge-offs for the quarters then ended.

December 31, September 30, December 31,
(Dollars in thousands) 2015 2015 2014
Non-performing premium finance receivables - commercial $24,855 $21,982 $20,370
- as a percent of premium finance receivables - commercial outstanding 1.05% 0.91% 0.87%
Net charge-offs (recoveries) of premium finance receivables - commercial $2,453 $1,317 $1,244
- annualized as a percent of average premium finance receivables - commercial 0.41% 0.21% 0.21%

Fluctuations in this category may occur due to timing and nature of account collections from insurance carriers. The Company’s underwriting standards, regardless of the condition of the economy, have remained consistent. We anticipate that net charge-offs and non-performing asset levels in the near term will continue to be at levels that are within acceptable operating ranges for this category of loans. Management is comfortable with administering the collections at this level of non-performing property and casualty premium finance receivables and believes reserves are adequate to absorb inherent losses that are expected upon the ultimate resolution of these credits.

Due to the nature of collateral for commercial premium finance receivables, it customarily takes 60-150 days to convert the collateral into cash. Accordingly, the level of non-performing commercial premium finance receivables is not necessarily indicative of the loss inherent in the portfolio. In the event of default, Wintrust has the power to cancel the insurance policy and collect the unearned portion of the premium from the insurance carrier. In the event of cancellation, the cash returned in payment of the unearned premium by the insurer should generally be sufficient to cover the receivable balance, the interest and other charges due. Due to notification requirements and processing time by most insurance carriers, many receivables will become delinquent beyond 90 days while the insurer is processing the return of the unearned premium. Management continues to accrue interest until maturity as the unearned premium is ordinarily sufficient to pay-off the outstanding balance and contractual interest due.

Nonperforming Loans Rollforward

The table below presents a summary of the changes in the balance of non-performing loans, excluding covered loans, for the periods presented:

Three Months Ended Years Ended
December 31, September 30, December 31, December 31, December 31,
(Dollars in thousands) 2015 2015 2014 2015 2014
Balance at beginning of period $85,976 $76,554 $81,070 $78,677 $103,334
Additions, net 5,983 24,333 6,797 48,124 37,984
Return to performing status (1,152) (1,028) (1,533) (3,743) (8,345)
Payments received (6,387) (5,468) (3,426) (22,804) (15,031)
Transfer to OREO and other repossessed assets (1,903) (1,773) (866) (10,581) (23,402)
Charge-offs (1,882) (4,081) (3,032) (10,519) (17,159)
Net change for niche loans (1) 3,422 (2,561) (333) 4,903 1,296
Balance at end of period $84,057 $85,976 $78,677 $84,057 $78,677

(1) This includes activity for premium finance receivables and indirect consumer loans.

TDRs

The table below presents a summary of TDRs as of the respective date, presented by loan category and accrual status:

December 31, September 30, December 31,
(Dollars in thousands) 2015 2015 2014
Accruing TDRs:
Commercial $5,613 $5,717 $6,654
Commercial real estate 32,777 39,867 60,120
Residential real estate and other 4,354 3,589 2,923
Total accrual $42,744 $49,173 $69,697
Non-accrual TDRs: (1)
Commercial $134 $147 $922
Commercial real estate 5,930 5,778 7,503
Residential real estate and other 3,045 4,222 4,153
Total non-accrual $9,109 $10,147 $12,578
Total TDRs:
Commercial $5,747 $5,864 $7,576
Commercial real estate 38,707 45,645 67,623
Residential real estate and other 7,399 7,811 7,076
Total TDRs $51,853 $59,320 $82,275
Weighted-average contractual interest rate of TDRs 4.13% 4.04% 4.09%

(1) Included in total non-performing loans.

At December 31, 2015, the Company had $51.9 million in loans classified as TDRs. The $51.9 million in TDRs represents 102 credits in which economic concessions were granted to certain borrowers to better align the terms of their loans with their current ability to pay. The balance decreased from $59.3 million representing 114 credits at September 30, 2015 and decreased from $82.3 million representing 145 credits at December 31, 2014.

The table below presents a summary of TDRs as of December 31, 2015 and December 31, 2014, and shows the changes in the balance during the periods presented:

Three Months Ended December 31, 2015
(Dollars in thousands) Commercial Commercial
Real Estate
Residential
Real Estate
and Other
Total
Balance at beginning of period $5,864 $45,645 $7,811 $59,320
Additions during the period 201 201
Reductions:
Charge-offs (1,707) (48) (1,755)
Transferred to OREO and other repossessed assets (135) (135)
Removal of TDR loan status (1) (19) (2,868) (2,887)
Payments received (98) (2,564) (229) (2,891)
Balance at period end $5,747 $38,707 $7,399 $51,853


Three Months Ended December 31, 2014
(Dollars in thousands) Commercial Commercial
Real Estate
Residential
Real Estate
and Other
Total
Balance at beginning of period $6,444 $70,441 $6,500 $83,385
Additions during the period 1,461 1,405 949 3,815
Reductions:
Charge-offs (559) (559)
Transferred to OREO and other repossessed assets
Removal of TDR loan status (1)
Payments received (329) (3,664) (373) (4,366)
Balance at period end $7,576 $67,623 $7,076 $82,275


Year Ended December 31, 2015
(Dollars in thousands) Commercial Commercial
Real Estate
Residential
Real Estate
and Other
Total
Balance at beginning of period $7,576 $67,623 $7,076 $82,275
Additions during the period 370 1,664 2,034
Reductions:
Charge-offs (397) (1,975) (140) (2,512)
Transferred to OREO and other repossessed assets (562) (2,290) (414) (3,266)
Removal of TDR loan status (1) (490) (13,019) (13,509)
Payments received (380) (12,002) (787) (13,169)
Balance at period end $5,747 $38,707 $7,399 $51,853

(1) Loan was previously classified as a TDR and subsequently performed in compliance with the loan’s modified terms for a period of six months (including over a calendar year-end) at a modified interest rate which represented a market rate at the time of restructuring. Per our TDR policy, the TDR classification is removed at the time of a subsequent modification.

Year Ended December 31, 2014
(Dollars in thousands) Commercial Commercial
Real Estate
Residential
Real Estate
and Other
Total
Balance at beginning of period $7,388 $93,535 $6,180 $107,103
Additions during the period 1,549 8,582 1,836 11,967
Reductions:
Charge-offs (51) (6,875) (479) (7,405)
Transferred to OREO and other repossessed assets (252) (16,057) (16,309)
Removal of TDR loan status (1) (383) (383)
Payments received (675) (11,562) (461) (12,698)
Balance at period end $7,576 $67,623 $7,076 $82,275

(1) Loan was previously classified as a TDR and subsequently performed in compliance with the loan’s modified terms for a period of six months (including over a calendar year-end) at a modified interest rate which represented a market rate at the time of restructuring. Per our TDR policy, the TDR classification is removed at the time of a subsequent modification.

Each TDR was reviewed for impairment at December 31, 2015 and approximately $1.8 million of impairment was present and appropriately reserved for through the Company’s normal reserving methodology in the Company’s allowance for loan losses. For TDRs in which impairment is calculated by the present value of future cash flows, the Company records interest income representing the decrease in impairment resulting from the passage of time during the respective period, which differs from interest income from contractually required interest on these specific loans. For the three months ended December 31, 2015 and 2014, the Company recorded $188,000 and $195,000, respectively, in interest income representing this decrease in impairment. For the year ended December 31, 2015 and 2014, the Company recorded $573,000 and $724,000, respectively, in interest income representing this decrease in impairment.

Other Real Estate Owned

The table below presents a summary of other real estate owned, excluding covered other real estate owned, as of December 31, 2015, September 30, 2015 and December 31, 2014, and shows the activity for the respective period and the balance for each property type:

Three Months Ended
December 31, September 30, December 31,
(Dollars in thousands) 2015 2015 2014
Balance at beginning of period $51,880 $42,080 $50,377
Disposals/resolved (9,156) (7,611) (4,367)
Transfers in at fair value, less costs to sell 2,345 6,159 1,641
Transfers in from covered OREO subsequent to loss share expiration 69 7,316
Additions from acquisition 4,617
Fair value adjustments (1,193) (681) (2,009)
Balance at end of period $43,945 $51,880 $45,642
Period End
December 31, September 30, December 31,
Balance by Property Type 2015 2015 2014
Residential real estate $11,322 $12,577 $7,779
Residential real estate development 2,914 3,147 3,245
Commercial real estate 29,709 36,156 34,618
Total $43,945 $51,880 $45,642

Covered Assets

In conjunction with FDIC-assisted transactions, the Company entered into loss share agreements with the FDIC. These agreements cover realized losses on loans, foreclosed real estate and certain other assets and require the Company to record loss share assets and liabilities that are measured separately from the loan portfolios because they are not contractually embedded in the loans and are not transferable with the loans should the Company choose to dispose of them. Fair values at the acquisition dates were estimated based on projected cash flows available for loss-share based on the credit adjustments estimated for each loan pool and the loss share percentages. The loss share assets and liabilities are also separately measured from the related loans and foreclosed real estate and recorded on the Consolidated Statements of Condition. Subsequent to the acquisition date, reimbursements received from the FDIC for actual incurred losses will reduce any loss share assets. Reductions to expected losses, to the extent such reductions to expected losses are the result of an improvement to the actual or expected cash flows from the covered assets, will also reduce any loss share asset and, if necessary, increase any loss share liability when necessary reductions exceed the current value of the loss share asset. The increases in cash flows for the purchased loans are recognized as interest income prospectively. In accordance with clawback provisions included in loss share agreements with the FDIC, the Company may be required to reimburse the FDIC when actual losses are less than certain thresholds established for each loss share agreement. The balance of these estimated reimbursements in accordance with clawback provisions and any related amortization are adjusted periodically for changes in the expected losses on covered assets. Estimated reimbursements from clawback provisions are recorded as a reduction to the loss share asset or, if necessary, an increase to the loss share liability on the Consolidated Statements of Condition. The allowance for loan losses for loans acquired in FDIC-assisted transactions is determined without giving consideration to the amounts recoverable through loss share agreements (since the loss share agreements are separately accounted for and thus presented “gross” on the balance sheet). On the Consolidated Statements of Income, the provision for credit losses is reported net of changes in the amount recoverable under the loss share agreements.

The following table provides a comparative analysis for the period end balances of covered assets and any changes in the allowance for covered loan losses. The Company expects covered assets and the allowance for covered loan losses to continue to decrease in periods without FDIC-assisted acquisitions.

December 31, September 30, December 31,
(Dollars in thousands) 2015 2015 2014
Period End Balances:
Loans $148,673 $168,609 $226,709
Other real estate owned 21,383 28,644 42,283
Other assets 411 686 757
FDIC Indemnification (liability) asset (6,100) (3,033) 11,846
Total covered assets $164,367 $194,906 $281,595
Allowance for Covered Loan Losses Rollforward:
Balance at beginning of quarter: $2,918 $2,215 $2,655
Provision for covered loan losses before benefit attributable to FDIC loss share agreements (2,011) (1,716) (3,059)
Benefit attributable to FDIC loss share agreements 1,874 1,373 2,448
Net provision for covered loan losses (137) (343) (611)
Decrease in FDIC indemnification asset (1,874) (1,373) (2,448)
Loans charged-off (163) (287) (175)
Recoveries of loans charged-off 2,282 2,706 2,710
Net recoveries 2,119 2,419 2,535
Balance at end of quarter $3,026 $2,918 $2,131

Changes in Accretable Yield

The excess of cash flows expected to be collected over the carrying value of loans accounted for under ASC 310-30 is referred to as the accretable yield and is recognized in interest income using an effective yield method over the remaining life of the pool of loans. The accretable yield is affected by:

  • Changes in interest rate indices for variable rate loans accounted for under ASC 310-30 – Expected future cash flows are based on the variable rates in effect at the time of the regular evaluations of cash flows expected to be collected;
  • Changes in prepayment assumptions – Prepayments affect the estimated life of loans accounted for under ASC 310-30 which may change the amount of interest income, and possibly principal, expected to be collected; and
  • Changes in the expected principal and interest payments over the estimated life – Updates to expected cash flows are driven by the credit outlook and actions taken with borrowers. Changes in expected future cash flows from loan modifications are included in the regular evaluations of cash flows expected to be collected.

The following table provides activity for the accretable yield of loans accounted for under ASC 310-30.

Three Months Ended Year Ended
December 31, December 31, December 31, December 31,
(Dollars in thousands) 2015 2014 2015 2014
Accretable yield, beginning balance $65,207 $87,031 $79,102 $115,909
Acquisitions 9,993
Accretable yield amortized to interest income (5,756) (7,454) (24,115) (36,956)
Accretable yield amortized to indemnification asset(1) (2,550) (5,098) (13,495) (30,691)
Reclassification from non-accretable difference(2) 2,236 6,690 7,390 35,967
(Decreases) increases in interest cash flows due to payments and changes in interest rates 4,765 (2,067) 5,027 (5,127)
Accretable yield, ending balance (3) $63,902 $79,102 $63,902 $79,102

(1) Represents the portion of the current period accreted yield, resulting from lower expected losses, applied to reduce the loss share indemnification asset.
(2) Reclassification is the result of subsequent increases in expected principal cash flows.
(3) As of December 31, 2015, the Company estimates that the remaining accretable yield balance to be amortized to the indemnification asset for the bank acquisitions is $6.6 million. The remainder of the accretable yield related to bank acquisitions is expected to be amortized to interest income.

Accretion to interest income accounted for under ASC 310-30 totaled $5.8 million and $7.5 million in the fourth quarter of 2015 and 2014, respectively. For the years ended December 31, 2015 and 2014, the Company recorded accretion to interest income of $24.1 million and $37.0 million, respectively. These amounts include accretion from both covered and non-covered loans, and are included together within interest and fees on loans in the Consolidated Statements of Income.

Items Impacting Comparative Financial Results:

Acquisitions

On July 24, 2015, the Company completed its acquisition of Community Financial Shares, Inc ("CFIS"). CFIS was the parent company of Community Bank - Wheaton/Glen Ellyn ("CBWGE"). Through this transaction, prior to purchase accounting adjustments, the Company acquired CBWGE's four banking locations in Wheaton and Glen Ellyn, Illinois, approximately $327 million in assets and approximately $301 million in deposits.

On July 17, 2015, the Company completed its acquisition of Suburban Illinois Bancorp, Inc. ("Suburban"). Suburban was the parent company of Suburban Bank & Trust Company ("SBT"). Through this transaction, prior to purchase accounting adjustments, the Company acquired SBT's ten banking locations in Chicago and its suburbs, approximately $480 million in assets and approximately $417 million in deposits.

On July 1, 2015, the Company, through its wholly-owned subsidiary Wintrust Bank, completed its acquisition of North Bank. Through this transaction, prior to purchase accounting adjustments, Wintrust Bank acquired two banking locations, $112 million in assets and approximately $100 million in deposits.

On January 16, 2015, the Company completed its acquisition of Delavan Bancshares, Inc. ("Delavan"). Delavan was the parent company of Community Bank CBD. Through this transaction, Town Bank acquired four banking locations, approximately $224 million in assets and approximately $170 million in deposits.

On August 8, 2014, the Company, through its subsidiary Town Bank, completed its acquisition of certain branch offices and deposits of Talmer Bank & Trust. Through this transaction, Town Bank acquired 11 branch offices and approximately $355 million in deposits.

On July 11, 2014, the Company, through its subsidiary Town Bank, completed its acquisition of the Pewaukee, Wisconsin branch of THE National Bank. In addition to the banking facility, Town Bank acquired approximately $75 million in loans and approximately $36 million in deposits.

On May 16, 2014, the Company, through its subsidiary Hinsdale Bank and Trust Company ("Hinsdale Bank"), completed its acquisition of the Stone Park branch office and certain related deposits of Urban Partnership Bank.

On April 28, 2014, the Company, through its subsidiary First Insurance Funding of Canada, Inc., completed its acquisition of 100% of the shares of each of Policy Billing Services Inc. and Equity Premium Finance Inc., two affiliated Canadian insurance premium funding and payment services companies.

On February 28, 2014, the Company, through its subsidiary Lake Forest Bank and Trust Company ("Lake Forest Bank"), completed its acquisition of a bank branch from Baytree National Bank & Trust Company. In addition to the banking facility, Lake Forest Bank acquired certain assets and approximately $15 million of deposits.

Announced Acquisition

On January 14, 2016, the Company announced the signing of a definitive agreement to acquire Generations Bancorp, Inc. ("Generations"), subject to regulatory approval and other closing conditions. Generations is the parent company of Foundations Bank which operated one banking location in Pewaukee, Wisconsin. As of September 30, 2015, Foundations had approximately $72 million in loans and approximately $97 million in deposits.

WINTRUST SUBSIDIARIES AND LOCATIONS

Wintrust is a financial holding company whose common stock is traded on the Nasdaq Global Select Market (Nasdaq:WTFC). Its 15 community bank subsidiaries are: Lake Forest Bank & Trust Company, Hinsdale Bank & Trust Company, Wintrust Bank in Chicago, Libertyville Bank & Trust Company, Barrington Bank & Trust Company, N.A., Crystal Lake Bank & Trust Company, N.A., Northbrook Bank & Trust Company, Schaumburg Bank & Trust Company, N.A., Village Bank & Trust in Arlington Heights, Beverly Bank & Trust Company, N.A. in Chicago, Wheaton Bank & Trust Company, State Bank of The Lakes in Antioch, Old Plank Trail Community Bank, N.A. in New Lenox, St. Charles Bank & Trust Company and Town Bank in Hartland, Wisconsin. The banks also operate facilities in Illinois in Algonquin, Aurora, Bloomingdale, Buffalo Grove, Cary, Chicago, Clarendon Hills, Crete, Deerfield, Des Plaines, Downers Grove, Elgin, Elk Grove Village, Elmhurst, Evergreen Park, Frankfort, Geneva, Glen Ellyn, Glencoe, Glenview, Gurnee, Grayslake, Hanover Park, Highland Park, Highwood, Hoffman Estates, Island Lake, Itasca, Joliet, Lake Bluff, Lake Villa, Lansing, Lemont, Lindenhurst, Lynwood, Markham, McHenry, Mokena, Mount Prospect, Mundelein, Naperville, North Chicago, Northfield, Norridge, Oak Lawn, Orland Park, Palatine, Park Ridge, Plainfield, Prospect Heights, Ravinia, Riverside, Rogers Park, Roselle, Round Lake Beach, Shorewood, Skokie, South Holland, Spring Grove, Steger, Stone Park, Vernon Hills, Wauconda, Western Springs, Willowbrook, Wilmette, Winnetka and Wood Dale and in Albany, Burlington, Clinton, Darlington, Delafield, Delavan, Elm Grove, Genoa City, Kenosha, Lake Geneva, Madison, Menomenee Falls, Milwaukee, Monroe, Pewaukee, Sharon, Wales, Walworth and Wind Lake, Wisconsin and Dyer, Indiana.

Additionally, the Company operates various non-bank business units:

  • First Insurance Funding Corporation, one of the largest insurance premium finance companies operating in the United States, serves commercial and life insurance loan customers throughout the country.
  • First Insurance Funding of Canada serves commercial insurance loan customers throughout Canada
  • Tricom, Inc. of Milwaukee provides high-yielding, short-term accounts receivable financing and value-added out-sourced administrative services, such as data processing of payrolls, billing and cash management services, to temporary staffing service clients located throughout the United States.
  • Wintrust Mortgage, a division of Barrington Bank & Trust Company, engages primarily in the origination and purchase of residential mortgages for sale into the secondary market through origination offices located throughout the United States. Loans are also originated nationwide through relationships with wholesale and correspondent offices.
  • Wayne Hummer Investments, LLC is a broker-dealer providing a full range of private client and brokerage services to clients and correspondent banks located primarily in the Midwest.
  • Great Lakes Advisors LLC provides money management services and advisory services to individual accounts.
  • The Chicago Trust Company, a trust subsidiary, allows Wintrust to service customers’ trust and investment needs at each banking location.

FORWARD-LOOKING STATEMENTS

This document contains forward-looking statements within the meaning of federal securities laws. Forward-looking information can be identified through the use of words such as “intend,” “plan,” “project,” “expect,” “anticipate,” “believe,” “estimate,” “contemplate,” “possible,” “point,” “will,” “may,” “should,” “would” and “could.” Forward-looking statements and information are not historical facts, are premised on many factors and assumptions, and represent only management’s expectations, estimates and projections regarding future events. Similarly, these statements are not guarantees of future performance and involve certain risks and uncertainties that are difficult to predict, which may include, but are not limited to, those listed below and the Risk Factors discussed under Item 1A of the Company’s 2014 Annual Report on Form 10-K and in any of the Company’s subsequent SEC filings. The Company intends such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995, and is including this statement for purposes of invoking these safe harbor provisions. Such forward-looking statements may be deemed to include, among other things, statements relating to the Company’s future financial performance, the performance of its loan portfolio, the expected amount of future credit reserves and charge-offs, delinquency trends, growth plans, regulatory developments, securities that the Company may offer from time to time, and management’s long-term performance goals, as well as statements relating to the anticipated effects on financial condition and results of operations from expected developments or events, the Company’s business and growth strategies, including future acquisitions of banks, specialty finance or wealth management businesses, internal growth and plans to form additional de novo banks or branch offices. Actual results could differ materially from those addressed in the forward-looking statements as a result of numerous factors, including the following:

  • negative economic conditions that adversely affect the economy, housing prices, the job market and other factors that may affect the Company’s liquidity and the performance of its loan portfolios, particularly in the markets in which it operates;
  • the extent of defaults and losses on the Company’s loan portfolio, which may require further increases in its allowance for credit losses;
  • estimates of fair value of certain of the Company’s assets and liabilities, which could change in value significantly from period to period;
  • the financial success and economic viability of the borrowers of our commercial loans;
  • market conditions in the commercial real estate market in the Chicago metropolitan area and southern Wisconsin;
  • the extent of commercial and consumer delinquencies and declines in real estate values, which may require further increases in the Company’s allowance for loan and lease losses;
  • inaccurate assumptions in our analytical and forecasting models used to manage our loan portfolio;
  • changes in the level and volatility of interest rates, the capital markets and other market indices that may affect, among other things, the Company’s liquidity and the value of its assets and liabilities;
  • competitive pressures in the financial services business which may affect the pricing of the Company’s loan and deposit products as well as its services (including wealth management services);
  • failure to identify and complete favorable acquisitions in the future or unexpected difficulties or developments related to the integration of the Company’s recent or future acquisitions;
  • unexpected difficulties and losses related to FDIC-assisted acquisitions, including those resulting from our loss-sharing arrangements with the FDIC;
  • any negative perception of the Company’s reputation or financial strength;
  • ability to raise additional capital on acceptable terms when needed;
  • disruption in capital markets, which may lower fair values for the Company’s investment portfolio;
  • ability to use technology to provide products and services that will satisfy customer demands and create efficiencies in operations;
  • adverse effects on our information technology systems resulting from failures, human error or tampering;
  • adverse effects of failures by our vendors to provide agreed upon services in the manner and at the cost agreed, particularly our information technology vendors;
  • increased costs as a result of protecting our customers from the impact of stolen debit card information;
  • accuracy and completeness of information the Company receives about customers and counterparties to make credit decisions;
  • ability of the Company to attract and retain senior management experienced in the banking and financial services industries;
  • environmental liability risk associated with lending activities;
  • the impact of any claims or legal actions, including any effect on our reputation;
  • losses incurred in connection with repurchases and indemnification payments related to mortgages;
  • the loss of customers as a result of technological changes allowing consumers to complete their financial transactions without the use of a bank;
  • the soundness of other financial institutions;
  • the expenses and delayed returns inherent in opening new branches and de novo banks;
  • examinations and challenges by tax authorities;
  • changes in accounting standards, rules and interpretations and the impact on the Company’s financial statements;
  • the ability of the Company to receive dividends from its subsidiaries;
  • a decrease in the Company’s regulatory capital ratios, including as a result of further declines in the value of its loan portfolios, or otherwise;
  • legislative or regulatory changes, particularly changes in regulation of financial services companies and/or the products and services offered by financial services companies, including those resulting from the Dodd-Frank Act;
  • a lowering of our credit rating;
  • changes in U.S. monetary policy;
  • restrictions upon our ability to market our products to consumers and limitations on our ability to profitably operate our mortgage business resulting from the Dodd-Frank Act;
  • increased costs of compliance, heightened regulatory capital requirements and other risks associated with changes in regulation and the current regulatory environment, including the Dodd-Frank Act;
  • the impact of heightened capital requirements;
  • increases in the Company’s FDIC insurance premiums, or the collection of special assessments by the FDIC;
  • delinquencies or fraud with respect to the Company’s premium finance business;
  • credit downgrades among commercial and life insurance providers that could negatively affect the value of collateral securing the Company’s premium finance loans;
  • delinquencies or fraud with respect to the Company's commercial equipment finance and leasing business;
  • the Company’s ability to comply with covenants under its credit facility; and
  • fluctuations in the stock market, which may have an adverse impact on the Company’s wealth management business and brokerage operation.

Therefore, there can be no assurances that future actual results will correspond to these forward-looking statements. The reader is cautioned not to place undue reliance on any forward-looking statement made by the Company. Any such statement speaks only as of the date the statement was made or as of such date that may be referenced within the statement. The Company undertakes no obligation to update any forward-looking statement to reflect the impact of circumstances after the date of the press release. Persons are advised, however, to consult further disclosures management makes on related subjects in its reports filed with the Securities and Exchange Commission and in its press releases.

CONFERENCE CALL, WEB CAST AND REPLAY

The Company will hold a conference call at 2:00 p.m. (CT) Tuesday, January 19, 2016 regarding fourth quarter and year-to-date 2015 results. Individuals interested in listening should call (877) 363-5049 and enter Conference ID #16980114. A simultaneous audio-only web cast and replay of the conference call may be accessed via the Company’s web site at (http://www.wintrust.com), Investor Relations, Investor News and Events, Presentations & Conference Calls. The text of the fourth quarter and year-to-date 2015 earnings press release will be available on the home page of the Company’s website at (http://www.wintrust.com) and at the Investor Relations, Investor News and Events, Press Releases link on its website.

WINTRUST FINANCIAL CORPORATION

Supplemental Financial Information

5 Quarter Trends

WINTRUST FINANCIAL CORPORATION - Supplemental Financial Information
Selected Financial Highlights - 5 Quarter Trends
(Dollars in thousands, except per share data)
Three Months Ended
December 31, 2015 September 30, 2015 June 30,
2015
March 31,
2015
December 31, 2014
Selected Financial Condition Data (at end of period):
Total assets $22,917,166 $22,043,930 $20,799,924 $20,382,271 $20,010,727
Total loans, excluding loans held-for-sale and covered loans 17,118,117 16,316,211 15,513,650 14,953,059 14,409,398
Total deposits 18,639,634 18,228,469 17,082,418 16,938,769 16,281,844
Junior subordinated debentures 268,566 268,566 249,493 249,493 249,493
Total shareholders’ equity 2,352,274 2,335,736 2,264,982 2,131,074 2,069,822
Selected Statements of Income Data:
Net interest income 167,206 165,540 156,892 151,891 153,719
Net revenue (1) 232,296 230,493 233,905 216,432 211,376
Net income 35,512 38,355 43,831 39,052 38,133
Net income per common share – Basic $0.66 $0.71 $0.89 $0.79 $0.78
Net income per common share – Diluted $0.64 $0.69 $0.85 $0.76 $0.75
Selected Financial Ratios and Other Data:
Performance Ratios:
Net interest margin (2) 3.29% 3.33% 3.41% 3.42% 3.46%
Non-interest income to average assets 1.16% 1.19% 1.52% 1.32% 1.18%
Non-interest expense to average assets 2.98% 2.93% 3.06% 3.01% 2.94%
Net overhead ratio (2) (3) 1.82% 1.74% 1.53% 1.69% 1.76%
Efficiency ratio - FTE (2) (4) 71.39% 69.02% 65.64% 67.90% 67.59%
Return on average assets 0.63% 0.70% 0.87% 0.80% 0.78%
Return on average common equity 6.03% 6.60% 8.38% 7.64% 7.51%
Return on average tangible common equity (2) 8.12% 8.88% 10.86% 9.96% 9.82%
Average total assets $22,233,492 $21,688,450 $20,256,996 $19,826,240 $19,366,670
Average total shareholders’ equity 2,347,545 2,310,511 2,156,128 2,114,356 2,057,855
Average loans to average deposits ratio (excluding covered loans) 91.9% 91.9% 92.8% 91.4% 89.5%
Average loans to average deposits ratio (including covered loans) 92.7 92.9 94.0 92.7 91.0
Common Share Data at end of period:
Market price per common share $48.52 $53.43 $53.38 $47.68 $46.76
Book value per common share (2) $43.42 $43.12 $42.24 $42.30 $41.52
Tangible common book value per share (2) $33.17 $32.83 $33.02 $33.04 $32.45
Common shares outstanding 48,383,279 48,336,870 47,677,257 47,389,608 46,805,055
Other Data at end of period:(8)
Leverage Ratio(5) 9.1% 9.2% 9.8% 9.2% 10.2%
Tier 1 Capital to risk-weighted assets (5) 10.0% 10.3% 10.7% 10.1% 11.6%
Common equity Tier 1 capital to risk-weighted assets (5) 8.4% 8.6% 9.0% 9.1% N/A
Total capital to risk-weighted assets (5) 12.2% 12.6% 13.1% 12.5% 13.0%
Tangible common equity ratio (TCE) (2) (7) 7.2% 7.4% 7.7% 7.9% 7.8%
Tangible common equity ratio, assuming full conversion of preferred stock (2) (7) 7.7% 8.0% 8.4% 8.5% 8.4%
Allowance for credit losses (6) $106,349 $103,922 $101,088 $95,334 $92,480
Non-performing loans 84,057 85,976 76,554 81,772 78,677
Allowance for credit losses to total loans (6) 0.62% 0.64% 0.65% 0.64% 0.64%
Non-performing loans to total loans 0.49% 0.53% 0.49% 0.55% 0.55%
Number of:
Bank subsidiaries 15 15 15 15 15
Banking offices 152 160 147 146 140

(1) Net revenue includes net interest income and non-interest income.
(2) See “Supplemental Financial Measures/Ratios” for additional information on this performance measure/ratio.
(3) The net overhead ratio is calculated by netting total non-interest expense and total non-interest income, annualizing this amount, and dividing by that period’s total average assets. A lower ratio indicates a higher degree of efficiency.
(4) The efficiency ratio is calculated by dividing total non-interest expense by tax-equivalent net revenue (less securities gains or losses). A lower ratio indicates more efficient revenue generation.
(5) Capital ratios for current quarter-end are estimated. As of January 1, 2015 capital ratios are calculated under the requirements of Basel III
(6) The allowance for credit losses includes both the allowance for loan losses and the allowance for unfunded lending-related commitments, but excluding the allowance for covered loan losses.
(7) Total shareholders’ equity minus preferred stock and total intangible assets divided by total assets minus total intangible assets.
(8) Asset quality ratios exclude covered loans.

WINTRUST FINANCIAL CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION
Consolidated Statements of Condition - 5 Quarter Trends
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
December 31, September 30, June 30, March 31, December 31,
(In thousands) 2015 2015 2015 2015 2014
Assets
Cash and due from banks $252,227 $247,341 $248,094 $286,743 $225,136
Federal funds sold and securities purchased under resale agreements 4,341 3,314 4,115 4,129 5,571
Interest bearing deposits with banks 627,009 701,106 591,721 697,799 998,437
Available-for-sale securities, at fair value 1,716,388 2,214,281 2,162,061 1,721,030 1,792,078
Held-to-maturity securities, at amortized cost 884,826
Trading account securities 448 3,312 1,597 7,811 1,206
Federal Home Loan Bank and Federal Reserve Bank stock 101,581 90,308 89,818 92,948 91,582
Brokerage customer receivables 27,631 28,293 29,753 25,287 24,221
Mortgage loans held-for-sale 388,038 347,005 497,283 446,355 351,290
Loans, net of unearned income, excluding covered loans 17,118,117 16,316,211 15,513,650 14,953,059 14,409,398
Covered loans 148,673 168,609 193,410 209,694 226,709
Total loans 17,266,790 16,484,820 15,707,060 15,162,753 14,636,107
Less: Allowance for loan losses 105,400 102,996 100,204 94,446 91,705
Less: Allowance for covered loan losses 3,026 2,918 2,215 1,878 2,131
Net loans 17,158,364 16,378,906 15,604,641 15,066,429 14,542,271
Premises and equipment, net 592,256 587,348 571,498 559,281 555,228
Lease investments, net 63,170 29,111 13,447 383 426
FDIC indemnification asset 3,429 10,224 11,846
Accrued interest receivable and other assets 604,917 637,925 542,897 536,734 501,456
Trade date securities receivable 277,981 488,063 485,534
Goodwill 471,761 472,166 421,646 420,197 405,634
Other intangible assets 24,209 25,533 17,924 18,858 18,811
Total assets $22,917,166 $22,043,930 $20,799,924 $20,382,271 $20,010,727
Liabilities and Shareholders’ Equity
Deposits:
Non-interest bearing $4,836,420 $4,705,994 $3,910,310 $3,779,609 $3,518,685
Interest bearing 13,803,214 13,522,475 13,172,108 13,159,160 12,763,159
Total deposits 18,639,634 18,228,469 17,082,418 16,938,769 16,281,844
Federal Home Loan Bank advances 859,876 451,330 444,017 416,036 733,050
Other borrowings 266,019 259,978 261,908 187,006 196,465
Subordinated notes 140,000 140,000 140,000 140,000 140,000
Junior subordinated debentures 268,566 268,566 249,493 249,493 249,493
Trade date securities payable 538 617 2,929 3,828
Accrued interest payable and other liabilities 390,259 359,234 357,106 316,964 336,225
Total liabilities 20,564,892 19,708,194 18,534,942 18,251,197 17,940,905
Shareholders’ Equity:
Preferred stock 251,287 251,312 251,312 126,427 126,467
Common stock 48,469 48,422 47,763 47,475 46,881
Surplus 1,190,988 1,187,407 1,159,052 1,156,542 1,133,955
Treasury stock (3,973) (3,964) (3,964) (3,948) (3,549)
Retained earnings 928,211 901,652 872,690 835,669 803,400
Accumulated other comprehensive loss (62,708) (49,093) (61,871) (31,091) (37,332)
Total shareholders’ equity 2,352,274 2,335,736 2,264,982 2,131,074 2,069,822
Total liabilities and shareholders’ equity $22,917,166 $22,043,930 $20,799,924 $20,382,271 $20,010,727


WINTRUST FINANCIAL CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION
Consolidated Statements of Income (Unaudited) - 5 Quarter Trends
Three Months Ended
December 31, September 30, June 30, March 31, December 31,
(In thousands, except per share data) 2015 2015 2015 2015 2014
Interest income
Interest and fees on loans $169,501 $167,831 $159,823 $154,676 $157,476
Interest bearing deposits with banks 493 372 305 316 495
Federal funds sold and securities purchased under resale agreements 1 1 2 3
Investment securities 16,405 16,130 14,071 14,400 13,761
Trading account securities 25 19 51 13 45
Federal Home Loan Bank and Federal Reserve Bank stock 857 821 785 769 749
Brokerage customer receivables 206 205 205 181 186
Total interest income 187,487 185,379 175,241 170,357 172,715
Interest expense
Interest on deposits 12,617 12,436 11,996 11,814 12,431
Interest on Federal Home Loan Bank advances 2,684 2,458 1,812 2,156 2,534
Interest on other borrowings 1,007 1,045 787 788 313
Interest on subordinated notes 1,777 1,776 1,777 1,775 1,776
Interest on junior subordinated debentures 2,196 2,124 1,977 1,933 1,942
Total interest expense 20,281 19,839 18,349 18,466 18,996
Net interest income 167,206 165,540 156,892 151,891 153,719
Provision for credit losses 9,059 8,322 9,482 6,079 6,133
Net interest income after provision for credit losses 158,147 157,218 147,410 145,812 147,586
Non-interest income
Wealth management 18,634 18,243 18,476 18,100 18,649
Mortgage banking 23,317 27,887 36,007 27,800 24,694
Service charges on deposit accounts 7,210 7,403 6,474 6,297 6,189
(Losses) gains on available-for-sale securities, net (79) (98) (24) 524 18
Fees from covered call options 3,629 2,810 4,565 4,360 2,966
Trading gains (losses), net 205 (135) 160 (477) (507)
Operating lease income, net 1,973 613 77 65 67
Other 10,201 8,230 11,278 7,872 5,581
Total non-interest income 65,090 64,953 77,013 64,541 57,657
Non-interest expense
Salaries and employee benefits 99,780 97,749 94,421 90,130 87,633
Equipment 8,772 8,414 7,847 7,779 7,502
Equipment on operating lease 1,229 473 67 57 53
Occupancy, net 13,062 12,066 11,401 12,351 11,600
Data processing 7,284 8,127 6,081 5,448 5,313
Advertising and marketing 5,373 6,237 6,406 3,907 3,669
Professional fees 4,387 4,100 5,074 4,664 4,039
Amortization of other intangible assets 1,324 1,350 934 1,013 1,171
FDIC insurance 3,317 3,035 3,047 2,987 2,810
OREO expenses, net 2,598 (367) 841 1,411 2,320
Other 19,703 18,790 18,178 17,571 17,331
Total non-interest expense 166,829 159,974 154,297 147,318 143,441
Income before taxes 56,408 62,197 70,126 63,035 61,802
Income tax expense 20,896 23,842 26,295 23,983 23,669
Net income $35,512 $38,355 $43,831 $39,052 $38,133
Preferred stock dividends and discount accretion $3,629 $4,079 $1,580 $1,581 $1,580
Net income applicable to common shares $31,883 $34,276 $42,251 $37,471 $36,553
Net income per common share - Basic $0.66 $0.71 $0.89 $0.79 $0.78
Net income per common share - Diluted $0.64 $0.69 $0.85 $0.76 $0.75
Cash dividends declared per common share $0.11 $0.11 $0.11 $0.11 $0.10
Weighted average common shares outstanding 48,371 48,158 47,567 47,239 46,734
Dilutive potential common shares 4,005 4,049 4,156 4,233 4,243
Average common shares and dilutive common shares 52,376 52,207 51,723 51,472 50,977


WINTRUST FINANCIAL CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION
Period End Loan Balances - 5 Quarter Trends
December 31, September 30, June 30, March 31, December 31,
(Dollars in thousands) 2015 2015 2015 2015 2014
Balance:
Commercial $4,713,909 $4,400,185 $4,330,344 $4,211,932 $3,924,394
Commercial real estate 5,529,289 5,307,566 4,850,590 4,710,486 4,505,753
Home equity 784,675 797,465 712,350 709,283 716,293
Residential real estate 607,451 571,743 503,015 495,925 483,542
Premium finance receivables - commercial 2,374,921 2,407,075 2,460,408 2,319,623 2,350,833
Premium finance receivables - life insurance 2,961,496 2,700,275 2,537,475 2,375,654 2,277,571
Consumer and other 146,376 131,902 119,468 130,156 151,012
Total loans, net of unearned income, excluding covered loans $17,118,117 $16,316,211 $15,513,650 $14,953,059 $14,409,398
Covered loans 148,673 168,609 193,410 209,694 226,709
Total loans, net of unearned income $17,266,790 $16,484,820 $15,707,060 $15,162,753 $14,636,107
Mix:
Commercial 27% 27% 27% 28% 26%
Commercial real estate 32 32 31 31 31
Home equity 5 5 5 5 5
Residential real estate 3 3 3 3 3
Premium finance receivables - commercial 14 15 16 15 16
Premium finance receivables - life insurance 17 16 16 16 16
Consumer and other 1 1 1 1 1
Total loans, net of unearned income, excluding covered loans 99% 99% 99% 99% 98%
Covered loans 1 1 1 1 2
Total loans, net of unearned income 100% 100% 100% 100% 100%


WINTRUST FINANCIAL CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION
Period End Deposits Balances - 5 Quarter Trends
December 31, September 30, June 30, March 31, December 31,
(Dollars in thousands) 2015 2015 2015 2015 2014
Balance:
Non-interest bearing $4,836,420 $4,705,994 $3,910,310 $3,779,609 $3,518,685
NOW and interest bearing demand deposits 2,390,217 2,231,258 2,240,832 2,262,928 2,236,089
Wealth Management deposits (1) 1,643,653 1,469,920 1,591,251 1,528,963 1,226,916
Money Market 4,041,300 4,001,518 3,898,495 3,791,762 3,651,467
Savings 1,723,367 1,684,007 1,504,654 1,563,752 1,508,877
Time certificates of deposit 4,004,677 4,135,772 3,936,876 4,011,755 4,139,810
Total deposits $18,639,634 $18,228,469 $17,082,418 $16,938,769 $16,281,844
Mix:
Non-interest bearing 26% 26% 23% 22% 22%
NOW and interest bearing demand deposits 13 12 13 13 14
Wealth Management deposits (1) 9 8 9 9 8
Money Market 22 22 23 23 22
Savings 9 9 9 9 9
Time certificates of deposit 21 23 23 24 25
Total deposits 100% 100% 100% 100% 100%

(1) Represents deposit balances of the Company’s subsidiary banks from brokerage customers of Wayne Hummer Investments, trust and asset management customers of The Chicago Trust Company and brokerage customers from unaffiliated companies which have been placed into deposit accounts of the Banks.

WINTRUST FINANCIAL CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION
Net Interest Margin (Including Call Option Income) - 5 Quarter Trends
Three Months Ended
December 31, September 30, June 30, March 31, December 31,
(Dollars in thousands) 2015 2015 2015 2015 2014
Net interest income $168,515 $166,737 $158,034 $152,952 $154,599
Call option income 3,629 2,810 4,565 4,360 2,966
Net interest income including call option income $172,144 $169,547 $162,599 $157,312 $157,565
Yield on earning assets 3.69% 3.73% 3.81% 3.83% 3.89%
Rate on interest-bearing liabilities 0.55 0.54 0.52 0.54 0.55
Rate spread 3.14% 3.19% 3.29% 3.29% 3.34%
Net free funds contribution 0.15 0.14 0.12 0.13 0.12
Net interest margin 3.29 3.33 3.41 3.42 3.46
Call option income 0.07 0.06 0.10 0.10 0.07
Net interest margin including call option income 3.36% 3.39% 3.51% 3.52% 3.53%


WINTRUST FINANCIAL CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION
Net Interest Margin (Including Call Option Income - YTD Trends)
Years Ended
December 31,
(Dollars in thousands) 2015 2014 2013 2012 2011
Net interest income $646,238 $601,744 $552,887 $521,463 $463,071
Call option income 15,364 7,859 4,773 10,476 13,570
Net interest income including call option income $661,602 $609,603 $557,660 $531,939 $476,641
Yield on earning assets 3.76% 3.96% 4.01% 4.21% 4.49%
Rate on interest-bearing liabilities 0.54 0.55 0.62 0.86 1.23
Rate spread 3.22% 3.41% 3.39% 3.35% 3.26%
Net free funds contribution 0.14 0.12 0.11 0.14 0.16
Net interest margin 3.36 3.53 3.50 3.49 3.42
Call option income 0.08 0.05 0.03 0.07 0.10
Net interest margin including call option income 3.44% 3.58% 3.53% 3.56% 3.52%


WINTRUST FINANCIAL CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION
Quarterly Average Balances - 5 Quarter Trends
Three Months Ended
December 31, September 30, June 30, March 31, December 31,
(In thousands) 2015 2015 2015 2015 2014
Liquidity management assets $3,245,393 $3,140,782 $2,709,176 $2,868,906 $2,972,220
Other earning assets 29,792 30,990 32,115 27,717 29,699
Loans, net of unearned income 16,889,922 16,509,001 15,632,875 15,031,917 14,469,745
Covered loans 154,846 174,768 202,663 214,211 244,139
Total earning assets $20,319,953 $19,855,541 $18,576,829 $18,142,751 $17,715,803
Allowance for loan and covered loan losses (109,448) (106,091) (101,211) (96,918) (97,506)
Cash and due from banks 260,593 251,289 236,242 249,687 243,080
Other assets 1,762,394 1,687,711 1,545,136 1,530,720 1,505,293
Total assets $22,233,492 $21,688,450 $20,256,996 $19,826,240 $19,366,670
Interest-bearing deposits $13,606,046 $13,489,651 $13,115,453 $12,863,507 $12,771,359
Federal Home Loan Bank advances 448,725 402,646 347,656 357,532 335,198
Other borrowings 269,914 272,782 193,660 194,994 84,795
Subordinated notes 140,000 140,000 140,000 140,000 140,000
Junior subordinated notes 268,566 264,974 249,493 249,493 249,493
Total interest-bearing liabilities $14,733,251 $14,570,053 $14,046,262 $13,805,526 $13,580,845
Non-interest bearing deposits 4,776,977 4,473,632 3,725,728 3,584,452 3,398,774
Other liabilities 375,719 334,254 328,878 321,906 329,196
Equity 2,347,545 2,310,511 2,156,128 2,114,356 2,057,855
Total liabilities and shareholders’ equity $22,233,492 $21,688,450 $20,256,996 $19,826,240 $19,366,670


WINTRUST FINANCIAL CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION
Net Interest Margin - 5 Quarter Trends
Three Months Ended
December 31, 2015 September 30, 2015 June 30, 2015 March 31, 2015 December 31, 2014
Yield earned on:
Liquidity management assets 2.28% 2.29% 2.36% 2.29% 2.08%
Other earning assets 3.26 3.00 3.54 2.94 3.40
Loans, net of unearned income 3.95 3.98 4.03 4.08 4.21
Covered loans 4.79 5.91 6.30 6.98 6.80
Total earning assets 3.69% 3.73% 3.81% 3.83% 3.89%
Rate paid on:
Interest-bearing deposits 0.37% 0.37% 0.37% 0.37% 0.39%
Federal Home Loan Bank advances 2.37 2.42 2.09 2.45 3.00
Other borrowings 1.48 1.52 1.63 1.64 1.47
Subordinated notes 5.08 5.08 5.07 5.07 5.07
Junior subordinated debentures 3.20 3.14 3.13 3.10 3.04
Total interest-bearing liabilities 0.55% 0.54% 0.52% 0.54% 0.55%
Interest rate spread 3.14% 3.19% 3.29% 3.29% 3.34%
Net free funds/contribution 0.15 0.14 0.12 0.13 0.12
Net interest income/margin 3.29% 3.33% 3.41% 3.42% 3.46%


WINTRUST FINANCIAL CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION
Non-Interest Income - 5 Quarter Trends
Three Months Ended
December 31, September 30, June 30, March 31, December 31,
(In thousands) 2015 2015 2015 2015 2014
Brokerage $6,850 $6,579 $6,750 $6,852 $7,892
Trust and asset management 11,784 11,664 11,726 11,248 10,757
Total wealth management 18,634 18,243 18,476 18,100 18,649
Mortgage banking 23,317 27,887 36,007 27,800 24,694
Service charges on deposit accounts 7,210 7,403 6,474 6,297 6,189
(Losses) gains on available-for-sale securities, net (79) (98) (24) 524 18
Fees from covered call options 3,629 2,810 4,565 4,360 2,966
Trading gains (losses), net 205 (135) 160 (477) (507)
Operating lease income, net 1,973 613 77 65 67
Other:
Interest rate swap fees 2,343 2,606 2,347 2,191 1,119
BOLI 1,463 212 2,180 766 661
Administrative services 1,101 1,072 1,053 1,026 1,107
Miscellaneous 5,294 4,340 5,698 3,889 2,694
Total other income 10,201 8,230 11,278 7,872 5,581
Total Non-Interest Income $65,090 $64,953 $77,013 $64,541 $57,657


WINTRUST FINANCIAL CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION
Non-Interest Expense - 5 Quarter Trends
Three Months Ended
December 31, September 30, June 30, March 31, December 31,
(In thousands) 2015 2015 2015 2015 2014
Salaries and employee benefits:
Salaries $50,982 $53,028 $46,617 $46,848 $45,255
Commissions and incentive compensation 31,222 30,035 33,387 25,494 28,369
Benefits 17,576 14,686 14,417 17,788 14,009
Total salaries and employee benefits 99,780 97,749 94,421 90,130 87,633
Equipment 8,772 8,414 7,847 7,779 7,502
Equipment on operating lease 1,229 473 67 57 53
Occupancy, net 13,062 12,066 11,401 12,351 11,600
Data processing 7,284 8,127 6,081 5,448 5,313
Advertising and marketing 5,373 6,237 6,406 3,907 3,669
Professional fees 4,387 4,100 5,074 4,664 4,039
Amortization of other intangible assets 1,324 1,350 934 1,013 1,171
FDIC insurance 3,317 3,035 3,047 2,987 2,810
OREO expenses, net 2,598 (367) 841 1,411 2,320
Other:
Commissions - 3rd party brokers 1,321 1,364 1,403 1,386 1,470
Postage 1,892 1,927 1,578 1,633 1,724
Miscellaneous 16,490 15,499 15,197 14,552 14,137
Total other expense 19,703 18,790 18,178 17,571 17,331
Total Non-Interest Expense $166,829 $159,974 $154,297 $147,318 $143,441


WINTRUST FINANCIAL CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION
Allowance for Credit Losses, excluding covered loans - 5 Quarter Trends
Three Months Ended
December 31, September 30, June 30, March 31, December 31,
(Dollars in thousands) 2015 2015 2015 2015 2014
Allowance for loan losses at beginning of period $102,996 $100,204 $94,446 $91,705 $91,019
Provision for credit losses 9,196 8,665 9,701 6,185 6,744
Other adjustments (243) (153) (93) (248) (236)
Reclassification from/(to) allowance for unfunded lending-related commitments 13 (42) 4 (113) 46
Charge-offs:
Commercial 1,369 964 1,243 677 289
Commercial real estate 2,734 1,948 856 1,005 4,434
Home equity 680 1,116 1,847 584 150
Residential real estate 211 1,138 923 631 630
Premium finance receivables - commercial 2,676 1,595 1,526 1,263 1,463
Premium finance receivables - life insurance 4
Consumer and other 179 116 115 111 156
Total charge-offs 7,849 6,877 6,510 4,271 7,126
Recoveries:
Commercial 315 462 285 370 315
Commercial real estate 491 213 1,824 312 572
Home equity 183 42 39 48 57
Residential real estate 55 136 16 76 19
Premium finance receivables - commercial 223 278 458 329 219
Premium finance receivables - life insurance 16 6
Consumer and other 20 52 34 53 70
Total recoveries 1,287 1,199 2,656 1,188 1,258
Net charge-offs (6,562) (5,678) (3,854) (3,083) (5,868)
Allowance for loan losses at period end $105,400 $102,996 $100,204 $94,446 $91,705
Allowance for unfunded lending-related commitments at period end 949 926 884 888 775
Allowance for credit losses at period end $106,349 $103,922 $101,088 $95,334 $92,480
Annualized net charge-offs by category as a percentage of its own respective category’s average:
Commercial 0.09% 0.05% 0.09% 0.03% %
Commercial real estate 0.16 0.13 (0.08) 0.06 0.34
Home equity 0.25 0.55 1.01 0.30 0.05
Residential real estate 0.07 0.42 0.39 0.28 0.30
Premium finance receivables - commercial 0.41 0.21 0.18 0.16 0.21
Premium finance receivables - life insurance
Consumer and other 0.37 0.17 0.23 0.13 0.19
Total loans, net of unearned income, excluding covered loans 0.15% 0.14% 0.10% 0.08% 0.16%
Net charge-offs as a percentage of the provision for credit losses 71.35% 65.53% 39.73% 49.87% 86.98%
Loans at period-end $17,118,117 $16,316,211 $15,513,650 $14,953,059 $14,409,398
Allowance for loan losses as a percentage of loans at period end 0.62% 0.63% 0.65% 0.63% 0.64%
Allowance for credit losses as a percentage of loans at period end 0.62% 0.64% 0.65% 0.64% 0.64%


WINTRUST FINANCIAL CORPORATION - SUPPLEMENTAL FINANCIAL INFORMATION
Non-Performing Assets, excluding covered assets - 5 Quarter Trends
December 31, September 30, June 30, March 31, December 31,
(Dollars in thousands) 2015 2015 2015 2015 2014
Loans past due greater than 90 days and still accruing (1):
Commercial $541 $ $ $ $474
Commercial real estate 701
Home equity
Residential real estate
Premium finance receivables - commercial 10,294 8,231 9,053 8,062 7,665
Premium finance receivables - life insurance 351
Consumer and other 150 140 110 91 119
Total loans past due greater than 90 days and still accruing 10,985 8,371 10,215 8,153 8,258
Non-accrual loans (2):
Commercial 12,712 12,018 5,394 5,586 9,157
Commercial real estate 26,645 28,617 23,183 29,982 26,605
Home equity 6,848 8,365 5,695 7,665 6,174
Residential real estate 12,043 14,557 16,631 14,248 15,502
Premium finance receivables - commercial 14,561 13,751 15,156 15,902 12,705
Premium finance receivables - life insurance
Consumer and other 263 297 280 236 277
Total non-accrual loans 73,072 77,605 66,339 73,619 70,420
Total non-performing loans:
Commercial 13,253 12,018 5,394 5,586 9,631
Commercial real estate 26,645 28,617 23,884 29,982 26,605
Home equity 6,848 8,365 5,695 7,665 6,174
Residential real estate 12,043 14,557 16,631 14,248 15,502
Premium finance receivables - commercial 24,855 21,982 24,209 23,964 20,370
Premium finance receivables - life insurance 351
Consumer and other 413 437 390 327 395
Total non-performing loans $84,057 $85,976 $76,554 $81,772 $78,677
Other real estate owned 26,849 29,053 33,044 33,131 36,419
Other real estate owned - from acquisition 17,096 22,827 9,036 9,126 9,223
Other repossessed assets $174 $193 $231 $259 $303
Total non-performing assets $128,176 $138,049 $118,865 $124,288 $124,622
TDRs performing under the contractual terms of the loan agreement 42,744 49,173 52,174 54,687 69,697
Total non-performing loans by category as a percent of its own respective category’s period-end balance:
Commercial 0.28% 0.27% 0.12% 0.13% 0.25%
Commercial real estate 0.48 0.54 0.49 0.64 0.59
Home equity 0.87 1.05 0.80 1.08 0.86
Residential real estate 1.98 2.55 3.31 2.87 3.21
Premium finance receivables - commercial 1.05 0.91 0.98 1.03 0.87
Premium finance receivables - life insurance 0.01
Consumer and other 0.28 0.33 0.33 0.25 0.26
Total loans, net of unearned income 0.49% 0.53% 0.49% 0.55% 0.55%
Total non-performing assets as a percentage of total assets 0.56% 0.63% 0.57% 0.61% 0.62%
Allowance for loan losses as a percentage of total non-performing loans 125.39% 119.79% 130.89% 115.50% 116.56%

(1) As of the dates shown, no TDRs were past due greater than 90 days and still accruing interest.
(2) Non-accrual loans included in TDRs totaling $9.1 million, $10.1 million, $10.6 million, $12.5 million and $12.6 million as of December 31, 2015, September 30, 2015, June 30, 2015, March 31, 2015 and December 31, 2014.

FOR MORE INFORMATION CONTACT: Edward J. Wehmer, President & Chief Executive Officer David A. Dykstra, Senior Executive Vice President & Chief Operating Officer (847) 939-9000 Web site address: www.wintrust.com

Source:Wintrust Financial Corporation