GlobeNewswire Inc | Apr 29, 2021 08:30AM EDT

April 29, 2021

SUFFOLK, Va., April 29, 2021 (GLOBE NEWSWIRE) -- TowneBank (the Company) (NASDAQ: TOWN) today reported earnings for the quarter ended March31, 2021 of $69.0million, or $0.95 per diluted share, compared to $26.38million, or $0.36 per diluted share, for the quarter ended March31, 2020.

Towne continued the strong earnings momentum from the latter half of last year fueled by continued strength in our fee-based businesses and solid growth in deposits and loans. Our deposit balances climbed to new record levels and our teams continue to assist those companies and individuals most impacted by the pandemic by delivering $429million in new Paycheck Protection Program funding during the first quarter. Overall, we are off to a great start to the year, said G. Robert Aston, Jr., Executive Chairman.

Highlights for First Quarter 2021 Compared to First Quarter 2020:

-- Total revenues were $182.51million, an increase of $44.81million, or 32.54%. -- Pre-provision, pre-tax, net revenues (non-GAAP) were $81.55million, an increase of $41.96million, or 105.99%. -- Loans held for investment were $9.73billion, an increase of $0.95billion, or 10.82%, from March31, 2020, and $0.11billion, or 1.10%, from December31, 2020. In first quarter 2021, the Company originated approximately $429.41million of loans in round two of the Small Business Administration's Paycheck Protection Program ("PPP"). The balance at March31, 2021 and December31, 2020 included $898.73million and $855.89million, respectively, of PPP loans. -- Total deposits were $12.14billion, an increase of $2.83billion, or 30.42%, compared to prior year and $0.57billion, or 4.89%, from December31, 2020. -- Noninterest bearing deposits increased by 58.17%, to $4.84billion, representing 39.87% of total deposits. Compared to the linked quarter, noninterest bearing deposits increased 10.66%. -- Annualized return on common shareholders' equity was 15.70% and annualized return on average tangible common shareholders' equity was 22.45% (non-GAAP). -- Net interest margin for the quarter was 3.04% and taxable equivalent net interest margin (non-GAAP) was 3.06%. -- Nonperforming assets were $17.27million, or 0.11% of total assets, compared to $29.75million, or 0.24%, at March31, 2020. -- Effective tax rate of 19.37% in the quarter compared to 19.00% in the first quarter of 2020.

During the quarter we opened our newest banking office located in the Myers Park area of Charlotte, North Carolina, with a third Charlotte region banking office planned to open later this year. Looking ahead, we believe the investments in our newer markets will deliver significant growth opportunities as the economy improves, stated J. Morgan Davis, President and Chief Executive Officer.

Quarterly Net Interest Income Compared to First Quarter 2020:

-- Net interest income was $99.99million compared to $89.50million at March31, 2020. -- Taxable equivalent net interest margin (non-GAAP) was 3.06%, including purchase accounting accretion of 5basispoints and PPP interest and fees of 12basis points, compared to 3.37%, including purchase accounting accretion of 13basispoints and no PPP interest and fees, for first quarter 2020. -- Average loans held for investment, with an average yield of 4.29%, represented 72.30% of average earning assets at March31, 2021 compared to an average yield of 4.73% and 79.60% of average earning assets in the first quarter of 2020. Excluding PPP loans, loan yields were 4.18% in first quarter 2021. -- Interest and fee income on PPP loans was $11.63million in first quarter 2021, compared to $11.29million in the linked quarter, and zero in first quarter 2020. -- Total cost of deposits decreased to 0.30% from 0.83% at March31, 2020. -- Average interest-earning assets totaled $13.34billion at March31, 2021 compared to $10.74billion at March31, 2020, an increase of 24.21%. -- Average interest-bearing liabilities totaled $8.01billion, an increase of $0.85billion from prior year. -- Interest expense on the Federal Reserve Bank ("FRB") PPP lending facility was $0.16million in first quarter, compared to $0.04million in the linked quarter, and zero in first quarter 2020.

Quarterly Provision for Credit Losses:

-- The quarterly provision for credit losses for on-balance-sheet loans was a benefit of $3.41million compared to a provision expense of $5.76million one year ago and an expense of $1.21million in the linked quarter. The first quarter 2021 included a release in the allowance for credit losses of $3.41million driven by a combination of minimal net charge-offs, improvements in the economic forecast, offset by modest core loan growth. -- Net loan charge-offs were $0.67million compared to charge-offs of $0.56million one year prior. The ratio of net loan charge-offs to average loans on an annualized basis was 0.03% in first quarter 2021 and 2020. -- The provision for credit losses on off-balance-sheet commitments was a benefit of $0.48million compared to a provision expense of $1.10million in the first quarter of 2020, and $0.06million in the linked quarter. -- The allowance for credit losses on loans represented 1.19% of total loans compared to 1.25% at December31, 2020 and 0.73% at March31, 2020. Excluding PPP loans, which are fully government guaranteed, the allowance for credit losses (non-GAAP) was 1.31%, compared to 1.37% at December31, 2020. The allowance for credit losses on loans was 9.09 times nonperforming loans compared to 10.74 times at December31, 2020 and 3.85 times at March31, 2020.

Quarterly Noninterest Income Compared to First Quarter 2020:

-- Total noninterest income was $82.52million compared to $48.20million in 2020, an increase of $34.32million, or 71.20%. Residential mortgage banking income increased $30.0million and real estate brokerage and property management income increased $11.0million. Also included in noninterest income are net gains on investment securities of $1.0million as compared to net gains of $5.0million in the prior year. -- Residential mortgage banking recorded income of $37.41million compared to $7.42million in first quarter 2020. Loan volume in the current quarter was $1.60billion, with purchase activity comprising 53.45% of that volume. Loan volume in first quarter 2020 was $0.92billion, with purchase activity comprising 61.31%. In addition to increased income resulting from the impact of higher loan volume and strong margins in the current quarter compared to prior year, the Company recorded a net gain on derivative instruments of $2.86million compared to a loss on derivative instruments of $10.89million in first quarter 2020. -- Total Insurance segment revenue decreased $0.17million, or 0.83% to $20.07million in first quarter 2021 compared to 2020. The Company acquired a property and casualty insurance agency in December 2020, which brought in $0.61million in additional revenue in first quarter 2021 and partially offset the impact of the reduction in revenues due to the sale of its travel insurance joint venture in third quarter 2020, which contributed revenue of $1.27million in first quarter 2020. -- Property management fee revenue increased 205.20%, or $10.41million, to $15.48million compared to first quarter 2020. The continuation of international travel restrictions related to COVID-19 coupled with many businesses and schools continuing to operate remotely has positively impacted the demand for domestic travel destinations. This high demand is in sharp contrast to the virtual shut-downs created by quarantines in first quarter 2020 that resulted in only limited reservation activities.

Quarterly Noninterest Expense Compared to First Quarter 2020:

-- Total noninterest expense was $97.33million compared to $96.89million in 2020, an increase of $0.44million, or 0.45%. Increases in salary and benefits expense of $2.57million, occupancy expense of $0.57million, data processing expense of $0.45million, and software expense of $0.70million, were partially offset by a $2.27million reduction in the estimated fourth quarter 2020 incentive accrual and $2.34million in deferred loan costs related to the origination of PPP loans during first quarter 2021. -- The quarterly increase in salaries and benefits was primarily driven by higher variable production related costs. Strong first quarter mortgage production resulted in increased overtime and incentive expenses as well as related payroll taxes. -- Increased mortgage volume and higher credit card fees on vacation property reservation activities drove the increase in data processing expense, while increased costs associated with our core banking platform resulted in higher software expenses.

Consolidated Balance Sheet Highlights:

-- Total assets were $15.08billion for the quarter ended March31, 2021, an increase of $0.45billion, or 3.10%, compared to $14.63billion at December31, 2020. Total assets increased $2.46billion, or 19.45%, from $12.62billion at March31, 2020. The year-over-year increase was driven primarily by higher liquidity levels and loans held for investment tied to PPP lending activities. -- Loans held for investment increased $0.95billion, or 10.82%, compared to prior year and $0.11billion compared the linked quarter. Excluding PPP loans of $0.90billion in the first quarter, and $0.86billion in the fourth quarter of 2020, loans held for investment increased $52.06million, or 0.59%, compared to prior year, and $63.08million, or 0.72%, compared to the linked quarter, or 2.92% on an annualized basis. -- Average loans held for investment, excluding PPP loans, were $8.78billion in the first quarter of 2021, an increase of $213.39million, or 2.49% compared to prior year. In the linked quarter comparison, average loans held for investment, excluding PPP loans, increased 0.61%, or $53.48million, 2.49% on an annualized basis. -- Mortgage loans held for sale increased $129.76million, or 28.64%, compared to the prior year and $42.11million, or 7.79%, compared to the linked quarter. -- Total deposits increased $2.83billion, or 30.42%, compared to the prior year and $0.57billion, or 4.89%, compared to the linked quarter. -- Total borrowings decreased $0.64billion, or 45.63%, from prior year and $0.20billion, or 20.82%, compared to the linked quarter.

Investment Securities:

-- Total investment securities were $1.46billion compared to $1.42billion at December31, 2020 and $1.35billion at March31, 2020. The weighted average duration of the portfolio at March31, 2021 was 4.33 years. The carrying value of the AFS debt securities portfolio included $28.12million in net unrealized gains compared to $58.32million in net unrealized gains at December31, 2020. During the first quarter of 2021, we sold $15.18million in AFS debt securities at a gain of $1.0million to reposition the portfolio.

Loans and Asset Quality:

-- Total loans held for investment were $9.73billion at March31, 2021 compared to $9.63billion at December31, 2020 and $8.78billion at March31, 2020. -- Nonperforming assets were $17.27million, or 0.11% of total assets, compared to $29.75million, or 0.24%, at March31, 2020. -- Nonperforming loans were 0.13% of period end loans compared to 0.19% at March31, 2020. -- Foreclosed property decreased to $3.75million from $13.05million at March31, 2020. -- Expected loss estimates are subject to change based on continuing review of models and assumptions, portfolio performance, changes in forecasted macroeconomic conditions and loan mix which could result in material changes to the reserve in future periods. -- At March31, 2021 we had $210.25million in loan modifications made in accordance with section 4013 of the CARES Act.

Deposits and Borrowings:

-- Total deposits were $12.14billion compared to $11.57billion at December31, 2020 and $9.31billion at March31, 2020. -- Total loans to deposits were 80.19% compared to 83.20% at December31, 2020 and 94.37% at March31, 2020. -- Non-interest bearing deposits were 39.87% of total deposits at March31, 2021 compared to 37.80% at December31, 2020 and 32.88% at March31, 2020. -- Total borrowings were $0.76billion compared to $0.96billion at December31, 2020 and $1.39billion at March31, 2020.

Capital:

-- Common equity tier 1 capital ratio of 12.15%. -- Tier 1 leverage capital ratio of 9.54%. -- Tier 1 risk-based capital ratio of 12.30%. -- Total risk-based capital ratio of 15.59%. -- Book value was $24.78 compared to $24.31 at December31, 2020 and $22.77 at March31, 2020. -- Tangible book value (non-GAAP) was $17.94 compared to $17.46 at December31, 2020 and $15.91 at March31, 2020.

About TowneBank:Founded in 1999, TowneBank is a company built on relationships, offering a full range of banking and other financial services, with a mission of serving others and enriching lives. Dedicated to a culture of caring, Towne values all employees and members by embracing their diverse talents, perspectives, and experiences.

Today, the bank operates over 40 banking offices throughout Hampton Roads and Central Virginia, as well as Northeastern and Central North Carolina serving as a local leader in promoting the social, cultural, and economic growth in each community. Towne offers a competitive array of business and personal banking solutions, delivered with only the highest ethical standards. Experienced local bankers providing a higher level of expertise and personal attention with local decision-making are key to the TowneBank strategy. Towne has grown its capabilities beyond banking to provide expertise through its controlled divisions and subsidiaries that include Towne Investment Group, Towne Wealth Management, Towne Insurance Agency, Towne Benefits, TowneBank Mortgage, TowneBank Commercial Mortgage, Berkshire Hathaway HomeServices Towne Realty, Towne 1031 Exchange, LLC, and Towne Vacations. With total assets of $15.08billion as of March31, 2021, TowneBank is one of the largest banks headquartered in Virginia.

Non-GAAP Financial Measures:This press release contains financial information determined by methods other than in accordance with GAAP. The Company's management uses these non-GAAP financial measures in its analysis of the Company's performance. These measures typically adjust GAAP performance measures to exclude the effects of the amortization of intangibles and include the tax benefit associated with revenue items that are tax-exempt, as well as adjust income available to common shareholders for certain significant activities or transactions that are infrequent in nature. Management believes presentations of these non-GAAP financial measures provide useful supplemental information that is essential to a proper understanding of the operating results of the Companys core businesses. These non-GAAP disclosures should not be viewed as a substitute for operating results determined in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Reconciliations of GAAP to non-GAAP disclosures are included as tables at the end of this release.

Forward-Looking Statements:Certain statements contained in this release constitute forward-looking statements within the meaning of U.S. federal securities laws. These forward-looking statements speak only as of the date of this release, are based on current expectations, and involve a number of assumptions. These include statements regarding TowneBanks future economic performance, financial condition, prospects, growth, strategies and expectations, and objectives of management, and are generally identified by the use of words such as believe, expect, intend, anticipate, estimate, or project or similar expressions. TowneBank 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 these safe harbor provisions. You should not place undue reliance on forward-looking statements, which are subject to assumptions that are subject to change. TowneBanks ability to predict results, or the actual effect of future plans or strategies, is inherently uncertain. These forward-looking statements are subject to a number of factors and uncertainties that could cause actual results to differ from those indicated or implied in the forward-looking statements and such differences may be material. Factors which could have a material effect on the operations and future prospects of TowneBank include but are not limited to: the impacts of the ongoing coronavirus (COVID-19) pandemic, changes in interest rates, general economic and business conditions; legislative/regulatory changes; the monetary and fiscal policies of the U.S. government, including policies of the U.S. Treasury and the Board of Governors of the Federal Reserve System; the quality and composition of TowneBanks loan and securities portfolios; demand for loan products; deposit flows; competition; demand for financial services in TowneBanks market area; implementation of new technologies and the ability to develop and maintain secure and reliable electronic systems; changes in the securities markets; changes in accounting principles, policies and guidelines; and other risk factors detailed from time to time in filings made by TowneBank with the Federal Deposit Insurance Corporation. TowneBank undertakes no obligation to update or clarify these forward-looking statements, whether as a result of new information, future events or otherwise.

Media contact:G. Robert Aston, Jr., Executive Chairman, 757-638-6780J. Morgan Davis, President and Chief Executive Officer, 757-673-1673

Investor contact:William B. Littreal, Chief Financial Officer, 757-638-6813



TOWNEBANKSelected Financial Highlights (unaudited)(dollars in thousands, except per share data) Three Months Ended March31, December 31, September30, June 30, March 31, 2021 2020 2020 2020 2020Income andPerformance Ratios: Total Revenue $ 182,509 $ 171,848 $ 192,135 $ 162,656 $ 137,696 Net income 72,631 53,891 50,715 37,222 27,605 Net income available to 68,995 50,082 34,464 34,605 26,384 common shareholders Pre-provision, pre-tax, net 81,547 62,107 73,903 69,014 39,587 revenues ^ (non-GAAP) Net income per common share - 0.95 0.69 0.48 0.48 0.36 diluted Book value per 24.78 24.31 23.83 23.50 22.77 common share Book value per common share - 17.94 17.46 17.06 16.68 15.91 tangible ^ (non-GAAP) Return on 1.92 % 1.35 % 0.89 % 0.97 % 0.88 % average assets Return on average assets 2.05 % 1.46 % 0.97 % 1.07 % 1.00 % - tangible ^ (non-GAAP) Return on 15.56 % 11.26 % 7.85 % 8.18 % 6.37 % average equity Return on average equity 22.19 % 16.28 % 11.66 % 12.32 % 9.91 % - tangible ^ (non-GAAP) Return on average common 15.70 % 11.36 % 7.91 % 8.24 % 6.42 % equity Return on average common equity - 22.45 % 16.48 % 11.79 % 12.44 % 10.01 % tangible ^ (non-GAAP) Noninterest income as a 45.21 % 41.45 % 49.64 % 42.66 % 35.00 % percentage of total revenueRegulatoryCapital Ratios (1): Common equity 12.15 % 11.87 % 11.75 % 11.54 % 11.23 % tier 1 Tier 1 12.30 % 12.04 % 11.91 % 11.67 % 11.35 % Total 15.59 % 15.42 % 15.35 % 14.91 % 14.40 % Tier 1 9.54 % 8.99 % 8.89 % 9.05 % 10.11 % leverage ratioAsset Quality: Allowance for credit losses on loans to 9.09x 10.74x 7.31x 5.34x 3.85x nonperforming loans Allowance for credit losses on loans to 1.19 % 1.25 % 1.22 % 0.92 % 0.73 % period end loans Allowance for credit losses on loans to period end 1.31 % 1.37 % 1.37 % 1.04 % 0.73 % loans excluding PPP loans ^ (non-GAAP) Nonperforming loans to 0.13 % 0.12 % 0.17 % 0.17 % 0.19 % period end loans Nonperforming assets to 0.11 % 0.11 % 0.19 % 0.19 % 0.24 % period end assets Net charge-offs (recoveries) 0.03 % ? % (0.01 ) ? % 0.03 % to average % loans (annualized) Net ) ) charge-offs $ 669 $ 109 $ (328 $ (102 $ 559 (recoveries) Nonperforming $ 12,768 $ 11,188 $ 16,295 $ 16,935 $ 16,700 loans Former bank 750 750 750 ? ? premises Foreclosed 3,748 4,276 11,695 12,315 13,053 property Total nonperforming $ 17,266 $ 16,214 $ 28,740 $ 29,250 $ 29,753 assets Loans past due 90 days and $ 108 $ 528 $ 19 $ 464 $ 91 still accruing interest Allowance for credit losses $ 116,077 $ 120,157 $ 119,058 $ 90,467 $ 64,372 on loansMortgage Banking: Loans originated, $ 1,187,595 $ 1,257,963 $ 1,292,801 $ 1,116,782 $ 718,681 mortgage Loans originated, 417,177 429,848 498,100 357,815 204,522 joint venture Total loans $ 1,604,772 $ 1,687,811 $ 1,790,901 $ 1,474,597 $ 923,203 originated Number of loans 5,165 5,481 5,817 4,818 3,025 originated Number of 229 228 224 216 223 originators Purchase % 53.45 % 59.76 % 61.21 % 51.26 % 61.31 % Loans sold $ 1,601,480 $ 1,845,926 $ 1,833,590 $ 1,398,649 $ 809,834 Rate lock $ 12,522 $ 11,781 $ 10,480 $ 7,202 $ 3,691 asset Gross realized gain on sales and fees as a 4.01 % 4.02 % 3.65 % 3.17 % 1.80 % % of loans originatedOther Ratios: Net interest 3.04 % 2.97 % 2.70 % 2.85 % 3.35 % margin Net interest margin-fully 3.06 % 2.98 % 2.72 % 2.87 % 3.37 % tax equivalent ^(non-GAAP) Average earning assets 91.47 % 91.59 % 92.09 % 91.33 % 89.15 % /total average assets Average loans/ average 82.71 % 83.42 % 86.29 % 91.81 % 92.99 % deposits Average noninterest deposits/total 38.39 % 39.61 % 37.76 % 36.52 % 32.21 % average deposits Period end equity/period 12.04 % 12.20 % 11.82 % 11.05 % 13.19 % end total assets Efficiency ratio^ 52.11 % 60.02 % 57.36 % 55.17 % 70.79 % (non-GAAP) (1) Current reporting period regulatory capital ratios are preliminary



TOWNEBANKSelected Data (unaudited)(dollars in thousands)

Investment % ChangeSecurities Q1 Q1 Q4 Q1 21 Q1 21 vs. vs.Available-for-salesecurities, at fair 2021 2020 2020 Q1 20 Q4 20valueU.S. agency $ 201,787 $ 121,857 $ 184,657 65.59 % 9.28 %securitiesU.S. Treasury notes 1,019 1,014 1,000 0.49 % 1.90 %Municipal 334,751 266,489 353,651 25.62 % (5.34 )securities %Trust preferred and ) )other corporate 31,241 59,606 31,499 (47.59 % (0.82 %securitiesMortgage-backedsecurities issued 849,418 799,713 797,765 6.22 % 6.47 %by GSE and GNMAAllowance for (210 ) (259 ) (348 ) (18.92 ) (39.66 )credit losses % %Total $ 1,418,006 $ 1,248,420 $ 1,368,224 13.58 % 3.64 %Gross unrealizedgains (losses)reflected in financialstatementsTotal gross $ 38,751 $ 30,545 $ 60,025 26.87 % (35.44 )unrealized gains %Total gross (10,632 ) (9,848 ) (1,703 ) 7.96 % 524.31 %unrealized lossesNet unrealizedgains (losses) and $ 28,119 $ 20,697 $ 58,322 35.86 % (51.79 )other adjustments %on AFS securitiesHeld-to-maturitysecurities, at amortized costMunicipal $ 5,032 $ 28,852 $ 5,012 (82.56 ) 0.40 %securities %Trust preferred ) )corporate 2,309 2,357 2,321 (2.04 % (0.52 %securitiesMortgage-backed ) )securities issued 8,639 11,222 9,179 (23.02 % (5.88 %by GSE and GNMAAllowance for (97 ) (133 ) (97 ) (27.07 ) ? %credit losses %Total $ 15,883 $ 42,298 $ 16,415 (62.45 ) (3.24 ) % % Gross unrealizedgains (losses) notreflected in financialstatementsTotal gross $ 1,598 $ 964 $ 1,957 65.77 % (18.34 )unrealized gains %Total gross ? ? ? ? % ? %unrealized lossesNet unrealized )gains (losses) in $ 1,598 $ 964 $ 1,957 65.77 % (18.34 %HTM securities Loans Held For % ChangeInvestment (1) Q1 Q1 Q4 Q1 21 Q1 21 vs. vs. 2021 2020 2020 Q1 20 Q4 20Real estate - ) )construction and $ 1,031,267 $ 1,060,834 $ 1,199,772 (2.79 % (14.04 %developmentCommercial realestate - owner 1,439,412 1,398,216 1,380,516 2.95 % 4.27 %occupiedCommercial realestate - non owner 2,477,315 2,305,971 2,335,235 7.43 % 6.08 %occupiedReal estate - 360,125 283,514 295,488 27.02 % 21.87 %multifamilyResidential 1-4 1,173,761 1,229,909 1,216,629 (4.57 ) (3.52 )family % %HELOC 400,314 463,653 412,476 (13.66 ) (2.95 ) % %Commercial andindustrial business 2,005,558 1,311,266 1,990,808 52.95 % 0.74 %(C&I)Government 398,579 324,978 379,243 22.65 % 5.10 %Indirect 278,567 268,347 271,459 3.81 % 2.62 %Consumer loans and 169,685 137,507 147,442 23.40 % 15.09 %otherTotal $ 9,734,583 $ 8,784,195 $ 9,629,068 10.82 % 1.10 %(1) Paycheck Protection Program loans totaling $0.90 billion and $0.86 billion,primarily in C&I, are included in Q1 2021 and Q4 2020, respectively. Deposits % Change Q1 Q1 Q4 Q1 21 Q1 21 vs. vs. 2021 2020 2020 Q1 20 Q4 20Noninterest-bearing $ 4,840,678 $ 3,060,515 $ 4,374,566 58.17 % 10.66 %demandInterest-bearing: Demand and money 5,062,461 3,573,926 4,819,604 41.65 % 5.04 %market accountsSavings 342,554 280,807 330,091 21.99 % 3.78 %Certificates of 1,893,951 2,392,744 2,048,905 (20.85 ) (7.56 %deposits %Total $ 12,139,644 $ 9,307,992 $ 11,573,166 30.42 % 4.89 %



TOWNEBANKAverage Balances, Yields and Rate Paid (unaudited)(dollars in thousands)

Three Months Ended Three Months Ended Three Months Ended March31, 2021 December31, 2020 March31, 2020 Interest Average Interest Average Interest Average Average Income/ Yield/ Average Income/ Yield/ Average Income/ Yield/ Balance Expense Rate Balance Expense Rate Balance Expense RateAssets: Loans (net ofunearned income anddeferred costs), $ 9,647,129 $ 101,960 4.29 % $ 9,752,150 $ 104,799 4.28 % $ 8,550,216 $ 100,566 4.73 %excludingnonaccrual loans(1)Taxable investment 1,303,535 6,604 2.03 % 1,250,375 6,878 2.20 % 1,356,411 9,211 2.72 %securitiesTax-exemptinvestment 139,859 542 1.55 % 139,572 520 1.49 % 128,204 861 2.69 %securitiesTotal securities 1,443,394 7,146 1.98 % 1,389,947 7,398 2.13 % 1,484,615 10,072 2.71 %Interest-bearing 1,715,110 416 0.10 % 1,754,365 435 0.10 % 373,984 1,102 1.19 %depositsLoans held for sale 536,997 3,361 2.50 % 587,517 3,867 2.63 % 333,070 2,988 3.59 %Total earning 13,342,630 112,883 3.43 % 13,483,979 116,499 3.44 % 10,741,885 114,728 4.30 %assetsLess: allowance for (120,934 ) (121,402 ) (55,331 ) credit lossesTotal nonearning 1,370,720 1,359,808 1,362,769 assetsTotal assets $ 14,592,416 $ 14,722,385 $ 12,049,323 Liabilities and Equity:Interest-bearing depositsDemand and money $ 4,904,885 $ 2,075 0.17 % $ 4,582,588 $ 2,633 0.23 % $ 3,521,707 $ 5,319 0.61 %marketSavings 332,006 522 0.64 % 317,561 552 0.69 % 276,947 593 0.86 %Certificates of 1,959,225 5,951 1.23 % 2,159,573 7,578 1.40 % 2,434,098 13,150 2.17 %depositTotalinterest-bearing 7,196,116 8,548 0.48 % 7,059,722 10,763 0.61 % 6,232,752 19,062 1.23 %depositsBorrowings 562,451 822 0.58 % 722,291 1,645 0.89 % 679,745 2,581 1.50 %Subordinated debt, 249,114 2,930 4.70 % 248,965 2,962 4.76 % 248,510 2,962 4.77 %netTotalinterest-bearing 8,007,681 12,300 0.62 % 8,030,978 15,370 0.76 % 7,161,007 24,605 1.38 %liabilitiesDemand deposits 4,483,444 4,630,665 2,962,110 Othernoninterest-bearing 303,524 291,836 260,500 liabilitiesTotal liabilities 12,794,649 12,953,479 10,383,617 Shareholders? 1,797,767 1,768,906 1,665,706 equityTotal liabilities $ 14,592,416 $ 14,722,385 $ 12,049,323 and equityNet interest income(tax-equivalent $ 100,583 $ 101,129 $ 90,123 basis)Reconciliation ofNon-GAAP Financial MeasuresTax-equivalent (593 ) (515 ) (627 ) basis adjustmentNet interest income $ 99,990 $ 100,614 $ 89,496 (GAAP) Interest rate 2.81 % 2.68 % 2.92 %spread (2)(3)Interest expense asa percent of 0.37 % 0.45 % 0.92 %average earningassetsNet interest margin(tax equivalent 3.06 % 2.98 % 3.37 %basis) (3)(4)Total cost of 0.30 % 0.37 % 0.83 %deposits

(1) March 31, 2021 and December 31, 2020 includes average PPP balances of $0.88 billion and $1.04 billion, and related interest and fee income of $11.63million and $11.29 million, respectively.(2) Interest spread is the average yield earned on earning assets less the average rate paid on interest-bearing liabilities. Fully tax equivalent.(3) Net interest margin is net interest income expressed as a percentage of average earning assets. Fully tax equivalent.(4) Non-GAAP.



TOWNEBANKConsolidated Balance Sheets(dollars in thousands, except share data) March31, December 31, 2021 2020 (unaudited) (audited)ASSETS Cash and due from banks $ 141,545 $ 41,514 Interest-bearing deposits at FRB - Richmond 1,936,458 1,795,241 Interest-bearing deposits in financial 30,031 27,532 institutionsTotal Cash and Cash Equivalents 2,108,034 1,864,287 Securities available for sale, at fair value(amortized cost of $1,390,097 and $1,310,250,and allowance for credit losses of $210 and 1,418,006 1,368,224 $348 at March 31, 2021 and December 31, 2020,respectively.)Securities held to maturity, at amortized cost(fair value $17,578 and $18,469 at March 31, 15,980 16,512 2021 and December 31, 2020, respectively.)Less: allowance for credit losses (97 ) (97 )Securities held to maturity, net of allowance 15,883 16,415 for credit lossesOther equity securities 6,355 6,492 FHLB stock 16,909 30,135 Total Securities 1,457,153 1,421,266 Mortgage loans held for sale 582,905 540,798 Loans, net of unearned income and deferred 9,734,583 9,629,068 costsLess: allowance for credit losses (116,077 ) (120,157 )Net Loans 9,618,506 9,508,911 Premises and equipment, net 261,831 260,242 Goodwill 452,328 452,328 Other intangible assets, net 44,808 45,533 BOLI 247,655 246,109 Other assets 306,176 286,970 TOTAL ASSETS $ 15,079,396 $ 14,626,444 LIABILITIES AND EQUITY Deposits: Noninterest-bearing demand $ 4,840,678 $ 4,374,566 Interest-bearing: Demand and money market accounts 5,062,461 4,819,604 Savings 342,554 330,091 Certificates of deposit 1,893,951 2,048,905 Total Deposits 12,139,644 11,573,166 Advances from the FHLB 255,872 456,038 Subordinated debt, net 249,204 249,055 FRB PPP lending facility 183,164 182,852 Repurchase agreements and other borrowings 68,509 67,786 Total Borrowings 756,749 955,731 Other liabilities 366,697 313,719 TOTAL LIABILITIES 13,263,090 12,842,616 Preferred stock, authorized and unissued shares ? ? - 2,000,000Common stock, $1.667 par: 150,000,000 sharesauthorized 72,653,670 and 72,667,541 shares 121,108 121,132 issued at March 31, 2021 and December 31, 2020,respectivelyCapital surplus 1,047,312 1,046,642 Retained earnings 613,826 557,889 Common stock issued to deferred compensationtrust, at cost 873,521 and 873,486 shares at (17,063 ) (16,969 )March 31, 2021 and December 31, 2020,respectivelyDeferred compensation trust 17,063 16,969 Accumulated other comprehensive income (loss) 17,969 41,184 TOTAL SHAREHOLDERS? EQUITY 1,800,215 1,766,847 Noncontrolling interest 16,091 16,981 TOTAL EQUITY 1,816,306 1,783,828 TOTAL LIABILITIES AND EQUITY $ 15,079,396 $ 14,626,444

TOWNEBANKConsolidated Statements of Income (unaudited)(dollars in thousands, except per share data) Three Months Ended March31, 2021 2020INTEREST INCOME: Loans, including fees $ 101,396 $ 100,062 Investment securities 7,117 9,949 Interest-bearing deposits in financial 416 1,102 institutions and federal funds soldMortgage loans held for sale 3,361 2,988 Total interest income 112,290 114,101 INTEREST EXPENSE: Deposits 8,548 19,062 Advances from the FHLB 497 2,492 Subordinated debt, net 2,930 2,962 Repurchase agreements and other borrowings 325 89 Total interest expense 12,300 24,605 Net interest income 99,990 89,496 PROVISION FOR CREDIT LOSSES (4,027 ) 7,016 Net interest income after provision for credit 104,017 82,480 lossesNONINTEREST INCOME: Residential mortgage banking income, net 37,412 7,416 Insurance commissions and other title fees and 16,325 16,893 income, netReal estate brokerage and property management 17,934 6,938 income, netService charges on deposit accounts 2,190 2,440 Credit card merchant fees, net 1,302 1,179 BOLI 1,519 3,105 Other income 4,837 5,227 Net gain/(loss) on investment securities 1,000 5,002 Total noninterest income 82,519 48,200 NONINTEREST EXPENSE: Salaries and employee benefits 58,435 55,867 Occupancy expense 8,072 7,502 Furniture and equipment 3,512 3,640 Amortization - intangibles 2,723 2,950 Software expense 4,194 3,492 Data processing 3,239 2,791 Professional fees 2,339 3,067 Advertising and marketing 2,968 3,584 Other expenses 11,844 13,995 Total noninterest expense 97,326 96,888 Income before income tax expense and 89,210 33,792 noncontrolling interestProvision for income tax expense 16,579 6,187 Net income $ 72,631 $ 27,605 Net income attributable to noncontrolling interest (3,636 ) (1,221 )Net income attributable to TowneBank $ 68,995 $ 26,384 Per common share information Basic earnings $ 0.95 $ 0.37 Diluted earnings $ 0.95 $ 0.36 Cash dividends declared $ 0.18 $ 0.18



TOWNEBANKConsolidated Balance Sheets - Five Quarter Trend(dollars in thousands, except share data)

March31, December 31, September30, June 30, March 31, 2021 2020 2020 2020 2020 (unaudited) (audited) (unaudited) (unaudited) (unaudited)ASSETS Cash and due from $ 141,545 $ 41,514 $ 114,604 $ 115,724 $ 108,929 banksInterest-bearingdeposits at FRB - 1,936,458 1,795,241 1,670,186 2,511,152 753,643 RichmondInterest-bearingdeposits in 30,031 27,532 24,890 24,374 23,564 financialinstitutionsTotal Cash and Cash 2,108,034 1,864,287 1,809,680 2,651,250 886,136 EquivalentsSecurities 1,418,006 1,368,224 1,310,683 1,266,624 1,248,420 available for saleSecurities held to 15,980 16,512 17,131 41,595 42,431 maturityLess: allowance for (97 ) (97 ) (90 ) (121 ) (133 )credit lossesSecurities held tomaturity, net of 15,883 16,415 17,041 41,474 42,298 allowance forcredit lossesOther equity 6,355 6,492 6,497 6,497 6,462 securitiesFHLB stock 16,909 30,135 41,829 49,277 52,042 Total Securities 1,457,153 1,421,266 1,376,050 1,363,872 1,349,222 Mortgage loans held 582,905 540,798 669,020 610,369 453,143 for saleLoans, net ofunearned income and 9,734,583 9,629,068 9,770,570 9,801,889 8,784,195 deferred costsLess: allowance for (116,077 ) (120,157 ) (119,058 ) (90,467 ) (64,372 )credit lossesNet Loans 9,618,506 9,508,911 9,651,512 9,711,422 8,719,823 Premises and 261,831 260,242 256,909 257,533 236,735 equipment, netGoodwill 452,328 452,328 446,725 446,725 446,725 Other intangible 44,808 45,533 45,781 48,632 51,448 assets, netBOLI 247,655 246,109 244,103 242,493 240,924 Other assets 306,176 286,970 295,637 247,962 239,670 TOTAL ASSETS $ 15,079,396 $ 14,626,444 $ 14,795,417 $ 15,580,258 $ 12,623,826 LIABILITIES AND EQUITYDeposits: Noninterest-bearing $ 4,840,678 $ 4,374,566 $ 4,464,178 $ 4,226,208 $ 3,060,515 demandInterest-bearing: Demand and money 5,062,461 4,819,604 4,642,482 4,223,391 3,573,926 market accountsSavings 342,554 330,091 312,444 298,673 280,807 Certificates of 1,893,951 2,048,905 2,285,859 2,516,666 2,392,744 depositTotal Deposits 12,139,644 11,573,166 11,704,963 11,264,938 9,307,992 Advances from the 255,872 456,038 731,202 906,365 971,527 FHLBSubordinated debt, 249,204 249,055 248,906 248,756 248,607 netFRB PPP lending 183,164 182,852 ? 1,111,429 ? facilityRepurchaseagreements and 68,509 67,786 58,061 60,913 171,762 other borrowingsTotal Borrowings 756,749 955,731 1,038,169 2,327,463 1,391,896 Other liabilities 366,697 313,719 303,582 266,314 258,306 TOTAL LIABILITIES 13,263,090 12,842,616 13,046,714 13,858,715 10,958,194 Preferred stock Authorized shares - ? ? ? ? ? 2,000,000Common stock, 121,108 121,132 121,115 121,101 121,057 $1.667 par valueCapital surplus 1,047,312 1,046,642 1,045,170 1,043,774 1,041,870 Retained earnings 613,826 557,889 520,888 499,502 477,972 Common stock issuedto deferred (17,063 ) (16,969 ) (16,951 ) (16,776 ) (15,562 )compensation trust,at costDeferred 17,063 16,969 16,951 16,776 15,562 compensation trustAccumulated othercomprehensive 17,969 41,184 44,569 43,218 12,301 income (loss)TOTAL SHAREHOLDERS? 1,800,215 1,766,847 1,731,742 1,707,595 1,653,200 EQUITYNoncontrolling 16,091 16,981 16,961 13,948 12,432 interestTOTAL EQUITY 1,816,306 1,783,828 1,748,703 1,721,543 1,665,632 TOTAL LIABILITIES $ 15,079,396 $ 14,626,444 $ 14,795,417 $ 15,580,258 $ 12,623,826 AND EQUITY



TOWNEBANKConsolidated Statements of Income - Five Quarter Trend (unaudited)(dollars in thousands, except share data) Three Months Ended March31, December 31, September30, June 30, March 31, 2021 2020 2020 2020 2020INTEREST INCOME: Loans, including $ 101,396 $ 104,182 $ 102,869 $ 102,139 $ 100,062 feesInvestment 7,117 7,499 7,440 8,163 9,949 securitiesInterest-bearingdeposits infinancial 416 435 632 433 1,102 institutions andfederal fundssoldMortgage loans 3,361 3,867 4,587 3,811 2,988 held for saleTotal interest 112,290 115,983 115,528 114,546 114,101 incomeINTEREST EXPENSE:Deposits 8,548 10,762 12,966 15,072 19,062 Advances from 497 1,404 1,901 2,595 2,492 the FHLBSubordinated 2,930 2,962 2,962 2,962 2,962 debtRepurchaseagreements and 325 241 940 643 89 other borrowingsTotal interest 12,300 15,369 18,769 21,272 24,605 expenseNet interest 99,990 100,614 96,759 93,274 89,496 income PROVISION FOR (4,027 ) 1,617 31,598 26,945 7,016 CREDIT LOSSESNet interestincome after 104,017 98,997 65,161 66,329 82,480 provision forcredit lossesNONINTEREST INCOME:Residentialmortgage banking 37,412 37,504 37,531 29,715 7,416 income, netInsurancecommissions and 16,325 13,868 17,468 17,612 16,893 other title feesand income, netReal estatebrokerage andproperty 17,934 9,229 11,301 10,781 6,938 managementincome, netService chargeson deposit 2,190 1,707 1,986 1,888 2,440 accountsCredit cardmerchant fees, 1,302 1,377 1,506 1,109 1,179 netBOLI 1,519 1,990 1,605 1,584 3,105 Other income 4,837 5,559 22,278 3,763 5,227 Net gain/(loss)on investment 1,000 ? 1,701 2,930 5,002 securitiesTotalnoninterest 82,519 71,234 95,376 69,382 48,200 incomeNONINTEREST EXPENSE:Salaries andemployee 58,435 61,475 61,408 56,926 55,867 benefitsOccupancy 8,072 8,193 8,396 7,227 7,502 expenseFurniture and 3,512 3,462 3,247 3,564 3,640 equipmentAmortization - 2,723 2,797 2,851 2,901 2,950 intangiblesSoftware expense 4,194 4,066 3,572 3,492 3,492 Data processing 3,239 2,363 3,113 2,718 2,791 Professional 2,339 2,591 2,637 2,972 3,067 feesAdvertising and 2,968 2,204 1,870 1,986 3,584 marketingOther expenses 11,844 18,781 14,887 9,239 13,995 Totalnoninterest 97,326 105,932 101,981 91,025 96,888 expenseIncome beforeincome taxexpense and 89,210 64,299 58,556 44,686 33,792 noncontrollinginterestProvision forincome tax 16,579 10,408 7,841 7,464 6,187 expenseNet income 72,631 53,891 50,715 37,222 27,605 Net incomeattributable to (3,636 ) (3,809 ) (16,251 ) (2,617 ) (1,221 )noncontrollinginterestNet incomeattributable to $ 68,995 $ 50,082 $ 34,464 $ 34,605 $ 26,384 TowneBankPer common share informationBasic earnings $ 0.95 $ 0.69 $ 0.48 $ 0.48 $ 0.37 Diluted earnings $ 0.95 $ 0.69 $ 0.48 $ 0.48 $ 0.36 Basic weightedaverage shares 72,414,953 72,357,177 72,339,413 72,280,555 72,206,228 outstandingDiluted weightedaverage shares 72,517,008 72,455,096 72,375,736 72,317,988 72,299,721 outstandingCash dividends $ 0.18 $ 0.18 $ 0.18 $ 0.18 $ 0.18 declared

TOWNEBANKBanking Segment Financial Information (unaudited)(dollars in thousands)

Three Months Ended Increase/(Decrease) March31, December31, 2021 over 2020 2021 2020 2020 Amount PercentRevenue Net interest $ 97,604 $ 87,406 $ 97,412 $ 10,198 11.67 %incomeService charges )on deposit 2,190 2,440 1,707 (250 ) (10.25 %accountsCredit card 1,302 1,179 1,377 123 10.43 %merchant feesOther income 4,970 7,061 5,983 (2,091 ) (29.61 ) %Subtotal 8,462 10,680 9,067 (2,218 ) (20.77 ) %Net gain/(loss) )on investment 1,000 5,002 ? (4,002 ) (80.01 %securitiesTotal )noninterest 9,462 15,682 9,067 (6,220 ) (39.66 %incomeTotal revenue 107,066 103,088 106,479 3,978 3.86 % Provision for (3,401 ) 7,041 1,628 (10,442 ) (148.30 )credit losses % Expenses Salaries and )employee 31,861 33,225 37,358 (1,364 ) (4.11 %benefitsOccupancy 5,546 4,916 5,681 630 12.82 %expenseFurniture and 2,668 2,660 2,625 8 0.30 %equipmentAmortization of 962 1,164 1,013 (202 ) (17.35 )intangibles %Other expenses 14,050 18,705 19,892 (4,655 ) (24.89 ) %Total expenses 55,087 60,670 66,569 (5,583 ) (9.20 ) %Income beforeincome tax,corporate 55,380 35,377 38,282 20,003 56.54 %allocation andnoncontrollinginterestCorporate 1,292 670 643 622 92.84 %allocationIncome beforeincome taxprovision and 56,672 36,047 38,925 20,625 57.22 %noncontrollinginterestProvision forincome tax 9,701 6,663 5,163 3,038 45.60 %expenseNet income 46,971 29,384 33,762 17,587 59.85 %Noncontrolling (5 ) (1 ) 4 (4 ) 400.00 %interestNet incomeattributable to $ 46,966 $ 29,383 $ 33,766 $ 17,583 59.84 %TowneBank Efficiency ) )ratio^ (non-GA^ 51.03 % 60.67 % 61.57 % (9.64 % (15.89 %AP^)



TOWNEBANKRealty Segment Financial Information (unaudited)(dollars in thousands)

Three Months Ended Increase/(Decrease) March31, December31, 2021 over 2020 2021 2020 2020 Amount PercentRevenue Residentialmortgage $ 37,877 $ 8,007 $ 38,040 $ 29,870 373.05 %brokerageincome, netReal estatebrokerage 2,451 1,865 3,564 586 31.42 %income, netTitleinsurance and 525 436 669 89 20.41 %settlementfeesPropertymanagement 15,483 5,073 5,665 10,410 205.20 %fees, netIncome fromunconsolidated 406 186 398 220 118.28 %subsidiaryNet interestand other 2,736 2,396 3,627 340 14.19 %incomeTotal revenue 59,478 17,963 51,963 41,515 231.11 % Provision for (626 ) (25 ) (11 ) (601 ) 2,404.00 %credit losses Expenses Salaries andemployee 16,847 13,293 16,168 3,554 26.74 %benefitsOccupancy 1,871 1,927 1,869 (56 ) (2.91 )expense %Furniture and 649 762 614 (113 ) (14.83 )equipment %Amortization )of intangible 590 657 658 (67 ) (10.20 %assetsOther expenses 9,229 6,867 8,779 2,362 34.40 %Total expenses 29,186 23,506 28,088 5,680 24.16 % Income (loss)before incometax, corporate 30,918 (5,518 ) 23,886 36,436 (660.31 )allocation and %noncontrollinginterestCorporate (1,000 ) (393 ) (403 ) (607 ) 154.45 %allocation(Loss) incomebefore incometax provision 29,918 (5,911 ) 23,483 35,829 (606.14 )and %noncontrollinginterestProvision forincome tax 6,216 (1,292 ) 4,421 7,508 (581.11 )(benefit) %expenseNet (loss) 23,702 (4,619 ) 19,062 28,321 (613.14 )income %Noncontrolling (3,631 ) (791 ) (3,813 ) (2,840 ) 359.04 %interestNet (loss)income $ 20,071 $ (5,410 ) $ 15,249 $ 25,481 (471.00 )attributable %to TowneBank Efficiency )ratio ^ 48.08 % 127.20 % 52.79 % (79.12 )% (62.20 %(non-GAAP)

TOWNEBANKInsurance Segment Financial Information (unaudited)(dollars in thousands)

Three Months Ended Increase/(Decrease) March31, December31, 2021 over 2020 2021 2020 2020 Amount PercentCommission and fee incomeProperty and $ 14,189 $ 12,786 $ 11,942 $ 1,403 10.97 %casualtyEmployee 3,884 3,918 3,725 (34 ) (0.87 )benefits %Travel insurance ? 1,266 ? (1,266 ) (100.00 ) %Specialized 167 168 175 (1 ) (0.60 )benefit services %Totalcommissions and 18,240 18,138 15,842 102 0.56 %fees Contingency and 1,759 2,022 1,087 (263 ) (13.01 )bonus revenue %Other income 73 81 69 (8 ) (9.88 ) %Total revenue 20,072 20,241 16,998 (169 ) (0.83 ) % Employeecommission 4,107 3,596 3,592 511 14.21 %expenseRevenue, net of )commission 15,965 16,645 13,406 (680 ) (4.09 %expense Salaries andemployee 9,727 9,349 7,949 378 4.04 %benefitsOccupancy 655 659 643 (4 ) (0.61 )expense %Furniture and 195 218 223 (23 ) (10.55 )equipment %Amortization ofintangible 1,171 1,129 1,126 42 3.72 %assetsOther expenses 1,305 1,357 1,334 (52 ) (3.83 ) %Total operating 13,053 12,712 11,275 341 2.68 %expensesIncome beforeincome tax,corporate 2,912 3,933 2,131 (1,021 ) (25.96 )allocation and %noncontrollinginterestCorporate (292 ) (277 ) (240 ) (15 ) 5.42 %allocationIncome beforeincome tax )provision and 2,620 3,656 1,891 (1,036 ) (28.34 %noncontrollinginterestProvision for )income tax 662 816 824 (154 ) (18.87 %expenseNet income 1,958 2,840 1,067 (882 ) (31.06 ) %Noncontrolling ? (429 ) ? 429 (100.00 )interest %Net income )attributable to $ 1,958 $ 2,411 $ 1,067 (453 ) (18.79 %TowneBank Provision for 662 816 824 (154 ) (18.87 )income taxes %Depreciation,amortization and 1,308 1,300 1,274 8 0.62 %interest expenseEBITDA^ $ 3,928 $ 4,527 $ 3,165 $ (599 ) (13.23 )(non-GAAP) % Efficiency ratio 74.43 % 69.59 % 75.70 % 4.84 % 6.96 %^ (non^-GAAP)



TOWNEBANKReconciliation of Non-GAAP Financial Measures(dollars in thousands)

Three Months Ended March31, March31, December31, 2021 2020 2020 Return on average assets 1.92 % 0.88 % 1.35 %(GAAP)Impact of excluding averagegoodwill and other intangibles 0.13 % 0.12 % 0.11 %and amortizationReturn on average tangible 2.05 % 1.00 % 1.46 %assets (non-GAAP) Return on average equity 15.56 % 6.37 % 11.26 %(GAAP)Impact of excluding averagegoodwill and other intangibles 6.63 % 3.54 % 5.02 %and amortizationReturn on average tangible 22.19 % 9.91 % 16.28 %equity (non-GAAP) Return on average common 15.70 % 6.42 % 11.36 %equity (GAAP)Impact of excluding averagegoodwill and other intangibles 6.75 % 3.59 % 5.12 %and amortizationReturn on average tangible 22.45 % 10.01 % 16.48 %common equity (non-GAAP) Book value (GAAP) $ 24.78 $ 22.77 $ 24.31 Impact of excluding averagegoodwill and other intangibles (6.84 ) (6.86 ) (6.85 )and amortizationTangible book value (non-GAAP) $ 17.94 $ 15.91 $ 17.46 Efficiency ratio (GAAP) 53.33 % 70.36 % 61.64 %Impact of exclusions (1.22 ) 0.43 % (1.62 ) % %Efficiency ratio (non-GAAP) 52.11 % 70.79 % 60.02 % Average assets (GAAP) $ 14,592,416 $ 12,049,323 $ 14,722,385 Less: average goodwill and 497,446 500,123 491,453 intangible assetsAverage tangible assets $ 14,094,970 $ 11,549,200 $ 14,230,932 (non-GAAP) Average equity (GAAP) $ 1,797,767 $ 1,665,706 $ 1,768,906 Less: average goodwill and 497,446 500,123 491,453 intangible assetsAverage tangible equity $ 1,300,321 $ 1,165,583 $ 1,277,453 (non-GAAP) Average common equity (GAAP) $ 1,782,795 $ 1,653,676 $ 1,753,596 Less: average goodwill and 497,446 500,123 491,453 intangible assetsAverage tangible common equity $ 1,285,349 $ 1,153,553 $ 1,262,143 (non-GAAP) Net Income (GAAP) $ 68,995 $ 26,384 50,082 Amortization of Intangibles, 2,151 2,331 2,210 net of taxTangible net income (non-GAAP) $ 71,146 $ 28,715 $ 52,292 Net Income (GAAP) $ 68,995 $ 26,384 $ 50,082 Provision for credit losses (4,027 ) 7,016 1,617 Provision for income tax 16,579 6,187 10,408 Pre-provision, pre-tax net $ 81,547 $ 39,587 $ 62,107 revenues (non-GAAP) Total Revenue (GAAP) $ 182,509 $ 137,696 $ 171,848 Net (gain)/loss on investment (1,000 ) (5,002 ) ? securitiesOther nonrecurring (income) 30 ? ? lossTotal Revenue for efficiency $ 181,539 $ 132,694 $ 171,848 calculation (non-GAAP) Noninterest expense (GAAP) $ 97,326 $ 96,888 $ 105,932 Less: Amortization of 2,723 2,950 2,797 intangiblesNoninterest expense net of $ 94,603 $ 93,938 $ 103,135 amortization (non-GAAP)