Sandy Spring Bancorp Reports Third Quarter Earnings of $16.2 Million

OLNEY, Md., Oct. 21, 2024 (GLOBE NEWSWIRE) -- Sandy Spring Bancorp, Inc. (Nasdaq-SASR), the parent company of Sandy Spring Bank, reported net income of $16.2 million ($0.36 per diluted common share) for the quarter ended September 30, 2024, compared to net income of $22.8 million ($0.51 per diluted common share) for the second quarter of 2024 and $20.7 million ($0.46 per diluted common share) for the third quarter of 2023.

Current quarter's core earnings were $17.9 million ($0.40 per diluted common share), compared to $24.4 million ($0.54 per diluted common share) for the quarter ended June 30, 2024 and $27.8 million ($0.62 per diluted common share) for the quarter ended September 30, 2023. Core earnings exclude the after-tax impact of amortization of intangibles, investment securities gains or losses and other non-recurring or extraordinary items. The current quarter's decline in net income and core earnings as compared to the linked quarter was driven by higher provision for credit losses combined with higher non-interest expense, partially offset by higher net interest income. The total provision for credit losses was $6.3 million for the third quarter of 2024 compared to $1.0 million for the previous quarter and $2.4 million for the third quarter of 2023.

“We have a solid capital position and are seeing ongoing success with our core deposit strategies and our wealth management lines of business,” said Daniel J. Schrider, Chair, President & CEO of Sandy Spring Bank. “Our wealth teams - Sandy Spring Trust, and our subsidiaries, West Financial and RPJ - have an expanding number of referrals from current clients and work closely with business owners from early growth through maturity. The success of our wealth teams' approach is reflected in our strong fee income results.”

Third Quarter Highlights

• Total assets at September 30, 2024 increased by 3% to $14.4 billion compared to $14.0 billion at June 30, 2024.
  
  
• Total loans remained level at $11.5 billion as of September 30, 2024 compared to June 30, 2024. During the current quarter, AD&C and commercial business loans and lines increased by $71.3 million and $19.4 million, respectively, while the commercial investor real estate segment declined by $64.9 million. Total residential mortgage and consumer loan portfolios remained relatively unchanged during this period.
  
  
• Deposits increased by $397.5 million or 4% to $11.7 billion at September 30, 2024 compared to $11.3 billion at June 30, 2024, as interest-bearing deposits increased $425.8 million, while noninterest-bearing deposits declined $28.3 million. Strong growth in the interest-bearing deposit categories was mainly experienced within money market, time deposits and savings accounts, which grew by $185.2 million, $151.5 million, and $66.1 million, respectively, compared to the linked quarter. The decline in noninterest-bearing deposit categories was driven by lower balances in personal and small business checking accounts. Total deposits, excluding brokered deposits, increased by $351.7 million or 3% quarter-over-quarter and represented 94% of total deposits as of September 30, 2024.
  
  
• The ratio of non-performing loans to total loans was 1.09% at September 30, 2024 compared to 0.81% at June 30, 2024 and 0.46% at September 30, 2023. The current quarter's increase in non-performing loans was mainly related to a single AD&C loan that was placed on non-accrual status during the current period. Net charge-offs for the current quarter totaled $0.7 million.
  
  
• Net interest income for the third quarter of 2024 grew $1.1 million or 1% compared to the previous quarter and decreased by $3.7 million or 4% compared to the third quarter of 2023. Compared to the previous quarter, interest income increased by $5.0 million, while interest expense increased by $3.9 million.
  
  
• The net interest margin was 2.44% for the third quarter of 2024 compared to 2.46% for the second quarter of 2024 and 2.55% for the third quarter of 2023. During the current quarter, the net interest margin was negatively impacted by a reversal of previously accrued uncollected interest income on a single large AD&C loan placed on a non-accrual status. Compared to the linked quarter, the rate paid on interest-bearing liabilities increased seven basis points, while the yield on interest-earning assets increased three basis points.
  
  
• Provision for credit losses directly attributable to the funded loan portfolio was $6.3 million for the current quarter compared to $3.0 million in the previous quarter and $3.2 million in the prior year quarter. The current quarter's provision expense is mainly attributable to higher individual reserves on collateral-dependent loans, primarily related to a single AD&C loan due to the borrower-specific circumstances, partially offset by lower qualitative adjustments due to the reduction in commercial investor real estate loans. In addition, during the current quarter, the provision for unfunded commitments was insignificant compared to a credit of $1.9 million from the previous quarter.
  
  
• Non-interest income for the third quarter of 2024 increased by 1% or $0.1 million compared to the linked quarter and grew by 13% or $2.3 million compared to the prior year quarter. The quarter-over-quarter increase was mainly driven by higher wealth management income and other income, generated by higher credit-related fees, which was fully offset by lower income from bank owned life insurance due to a receipt of one-time mortality proceeds during the prior quarter.
  
  
• Non-interest expense for the third quarter of 2024 increased by $4.8 million compared to the second quarter of 2024 and $0.5 million compared to the prior year quarter. The quarterly increase in non-interest expense was primarily due to higher salaries and benefits along with an increase in professional fees and services.
  
  
• Return on average assets (“ROA”) for the quarter ended September 30, 2024 was 0.46% and return on average tangible common equity (“ROTCE”) was 5.88% compared to 0.66% and 8.27%, respectively, for the second quarter of 2024 and 0.58% and 7.42%, respectively, for the third quarter of 2023. On a non-GAAP basis, the current quarter's core ROA was 0.50% and core ROTCE was 5.88% compared to 0.70% and 8.27%, respectively, for the previous quarter and 0.78% and 9.51%, respectively, for the third quarter of 2023.
  
  
• The GAAP efficiency ratio was 72.12% for the third quarter of 2024, compared to 68.19% for the second quarter of 2024 and 70.72% for the third quarter of 2023. The non-GAAP efficiency ratio was 69.06% for the third quarter of 2024 compared to 65.31% for the second quarter of 2024 and 60.91% for the prior year quarter. The increase in non-GAAP efficiency ratio (reflecting a decrease in efficiency) in the current quarter compared to the previous quarter was the result of higher non-interest expense in the current quarter.
  

Balance Sheet and Credit Quality

Total assets were $14.4 billion at September 30, 2024, as compared to $14.0 billion at June 30, 2024. At September 30, 2024, total loans remained stable at $11.5 billion compared to the previous quarter. During this period, the growth in AD&C and commercial business loans and lines of $71.3 million or 6% and $19.4 million or 1%, respectively, were mostly offset by the decline in commercial investor real estate loans of $64.9 million or 1%. Total residential mortgage and consumer loan portfolios remained relatively unchanged.

Deposits increased $397.5 million or 4% to $11.7 billion at September 30, 2024 compared to $11.3 billion at June 30, 2024. During this period, noninterest-bearing deposits decreased $28.3 million or 1%, while interest-bearing deposits increased $425.8 million or 5%. The slight decline in noninterest-bearing deposit categories was driven by decreases in personal and small business checking accounts, partially offset by an increase in commercial checking accounts. Growth in interest-bearing deposits was seen across all product categories, but most notably in money market and time deposit accounts which grew $185.2 million or 7% and $151.5 million or 6% during the current quarter, respectively. Total deposits, excluding brokered deposits, increased by $351.7 million or 3% quarter-over-quarter and remained at 94% of the total deposits as of September 30, 2024 compared to June 30, 2024, reflecting continued strength and stability of the core deposit base. Total uninsured deposits at September 30, 2024 were approximately 37% of total deposits.

Total borrowings decreased $54.1 million or 6% at September 30, 2024 as compared to the previous quarter, primarily driven by a $50.0 million pay down of FHLB advances. At September 30, 2024, available unused sources of liquidity, which consist of available FHLB borrowings, fed funds, funds through the Federal Reserve Bank's discount window, as well as excess cash and unpledged investment securities, totaled $6.3 billion or 146% of uninsured deposits.

The tangible common equity to tangible assets ratio declined slightly to 8.83% at September 30, 2024, compared to 8.85% at June 30, 2024.

At September 30, 2024, the Company had a total risk-based capital ratio of 15.53%, a common equity tier 1 risk-based capital ratio of 11.27%, a tier 1 risk-based capital ratio of 11.27%, and a tier 1 leverage ratio of 9.59%. These risk-based capital ratios compare to a total risk-based capital ratio of 15.49%, a common equity tier 1 risk-based capital ratio of 11.28%, a tier 1 risk-based capital ratio of 11.28%, and a tier 1 leverage ratio of 9.70% at June 30, 2024. All of these ratios remain well in excess of the mandated minimum regulatory requirements.

Non-performing loans include non-accrual loans and accruing loans 90 days or more past due. At September 30, 2024, non-performing loans totaled $125.3 million, compared to $93.0 million at June 30, 2024 and $51.8 million at September 30, 2023. The non-performing loans to total loans ratio was 1.09% compared to 0.81% on a linked quarter basis. These levels of non-performing loans compare to 0.46% at September 30, 2023. The current quarter's increase in non-performing loans was mainly related to a single AD&C loan with the total outstanding principal balance of $28.0 million, which was placed on a non-accrual status during the current period. Total net charge-offs for the current quarter amounted to $0.7 million compared to $0.2 million for the second quarter of 2024 and $0.1 million for the third quarter of 2023.

At September 30, 2024, the allowance for credit losses was $131.4 million or 1.14% of outstanding loans and 105% of non-performing loans, compared to $125.9 million or 1.10% of outstanding loans and 135% of non-performing loans at the end of the previous quarter and $123.4 million or 1.09% of outstanding loans and 238% of non-performing loans at the end of the third quarter of 2023. The increase in the allowance for the current quarter compared to the previous quarter mainly reflects higher individual reserves on collateral-dependent non-accrual loans, primarily driven by the aforementioned AD&C lending relationship, partially offset by lower qualitative adjustments as a result of declines in commercial investor real estate loans.

Income Statement Review

Quarterly Results

Net income was $16.2 million ($0.36 per diluted common share) for the three months ended September 30, 2024 compared to $22.8 million ($0.51 per diluted common share) for the three months ended June 30, 2024 and $20.7 million ($0.46 per diluted common share) for the prior year quarter. The current quarter's core earnings were $17.9 million ($0.40 per diluted common share), compared to $24.4 million ($0.54 per diluted common share) for the previous quarter and $27.8 million ($0.62 per diluted common share) for the quarter ended September 30, 2023. The decreases in the current quarter's net income and core earnings compared to the previous quarter were driven primarily by higher provision for credit losses and non-interest expense.

Net interest income for the third quarter of 2024 increased $1.1 million or 1% compared to the previous quarter and declined $3.7 million or 4% compared to the third quarter of 2023. During the current quarter, interest income increased $5.0 million, while interest expense increased $3.9 million. The rising interest rate environment was primarily responsible for a $7.7 million year-over-year increase in interest income. This growth in interest income was more than offset by the $11.4 million year-over-year growth in interest expense as funding costs have also risen in response to the rising rate environment and significant competition for deposits.

The net interest margin was 2.44% for the third quarter of 2024 compared to 2.46% for the second quarter of 2024 and 2.55% for the third quarter of 2023. The decrease in the net interest margin during the current quarter was a result of a seven basis point increase in the rate paid on interest-bearing liabilities, while the yield earned on interest-earning assets rose three basis points. The current quarter's net interest margin was negatively impacted by approximately three basis points due to the reversal of previously accrued uncollected interest income on a single large AD&C loan placed on non-accrual status during the period. As compared to the prior year quarter, the yield on interest-earning assets increased 23 basis points while the rate paid on interest-bearing liabilities rose 39 basis points, resulting in net interest margin compression of 11 basis points. The rate and yield increases year-over-year were driven by the higher interest rate environment, competition for deposits in the market, and customer movement of excess funds out of noninterest-bearing accounts into higher yielding products.

The total provision for credit losses was $6.3 million for the third quarter of 2024 compared to $1.0 million for the previous quarter and $2.4 million for the third quarter of 2023. The provision for credit losses directly attributable to the funded loan portfolio was $6.3 million for the current quarter compared to $3.0 million for the second quarter of 2024 and $3.2 million for the third quarter of 2023. The current quarter's provision is mainly a reflection of higher individual reserves on collateral-dependent non-accrual loans, primarily associated with the provision on a single AD&C lending relationship based on the current fair value of the collateral, partially offset by lower qualitative adjustments driven by an overall reduction in commercial investor real estate loan portfolio. In addition, during the current quarter, the reserve for unfunded commitments remained relatively stable at $1.5 million.

Non-interest income for the third quarter of 2024 increased by 1% or $0.1 million compared to the linked quarter and grew by 13% or $2.3 million compared to the prior year quarter. The current quarter's increase in non-interest income as compared to the previous quarter was mainly driven by the $0.4 million increase in other income, generated by credit-related fees, and $0.3 million increase in wealth management income, due to the $352.1 million or 6% growth in assets under management quarter-over-quarter and the overall favorable market performance, offset by $0.5 million decrease in BOLI income, due to the receipt of one-time death proceeds in the prior quarter.

Non-interest expense for the third quarter of 2024 increased $4.8 million or 7% compared to the second quarter of 2024 and $0.5 million or 1% compared to the third quarter of 2023. The quarter-over-quarter increase is predominantly attributable to the $3.2 million increase in salaries and benefits, due to the increase in employee incentive compensation coupled with the $1.6 million increase in professional fees and services, mostly due to a one-time contract negotiation fee. The prior year quarter included $8.2 million of pension settlement expense related to the termination of the Company's pension plan. Excluding this item, non-interest expense for the third quarter of 2024 increased $8.6 million or 13% compared to the third quarter of 2023.

For the third quarter of 2024, the GAAP efficiency ratio was 72.12% compared to 68.19% for the second quarter of 2024 and 70.72% for the third quarter of 2023. The GAAP efficiency ratio rose from the prior year quarter primarily as a result of the 1% increase in GAAP non-interest expense coupled with the 1% decline in GAAP revenue. The non-GAAP efficiency ratio was 69.06% for the current quarter as compared to 65.31% for the second quarter of 2024 and 60.91% for the third quarter of 2023. The increase in the non-GAAP efficiency ratio (reflecting a decrease in efficiency) from the third quarter of the prior year to the current year quarter was primarily the result of the 12% increase in adjusted non-interest expense.

ROA for the quarter ended September 30, 2024 was 0.46% and ROTCE was 5.88% compared to 0.66% and 8.27%, respectively, for the second quarter of 2024 and 0.58% and 7.42%, respectively, for the third quarter of 2023. On a non-GAAP basis, the current quarter's core ROA was 0.50% and core ROTCE was 5.88% compared to 0.70% and 8.27% for the second quarter of 2024 and 0.78% and 9.51%, respectively, for the third quarter of 2023.

Year-to-Date Results

The Company recorded net income of $59.4 million for the nine months ended September 30, 2024 compared to net income of $96.7 million for the same period in the prior year. Core earnings were $64.3 million for the nine months ended September 30, 2024 compared to $107.2 million for the same period in the prior year. Year-to-date net income and core earnings declined as a result of lower net interest income in combination with higher provision for credit losses, which was partially offset by higher non-interest income.

For the nine months ended September 30, 2024, net interest income decreased $31.8 million compared to the prior year as a result of the $61.1 million increase in interest expense, partially offset by the $29.3 million increase in interest income. The increase in interest expense was driven by the interest expense on deposits, primarily associated with savings and time deposit accounts. The net interest margin declined to 2.44% for the nine months ended September 30, 2024, compared to 2.75% for the prior year, primarily as a result of higher funding costs due to the elevated interest rate environment and market competition for deposits during the period.

The provision for credit losses for the nine months ended September 30, 2024 was $9.7 million as compared to a credit of $14.1 million for 2023. The provision for the nine months ended September 30, 2024 was primarily due to an increase in individual reserves on collateral-dependent non-accrual loans, as well as adjustments applied to specific industries within the commercial real estate segment during the first quarter of 2024. The prior year's credit to provision was mainly attributable to the improving regional forecasted unemployment rate observed during the first half of 2023, and the declining probability of economic recession.

For the nine months ended September 30, 2024, non-interest income increased 14% to $57.7 million compared to $50.5 million for 2023. During the current year, wealth management income increased $3.7 million or 14%, as assets under management increased $1.0 billion or 19% year-over-year. In addition, BOLI mortality-related income and service charges on deposit accounts increased $1.3 million and $1.1 million, respectively.

Non-interest expense increased to $209.0 million for the nine months ended September 30, 2024, compared to $207.9 million for 2023. The drivers of the increase in non-interest expense were the $4.0 million increase in professional fees and services, $2.7 increase in amortization of intangible assets, $1.8 million increase in FDIC expense, and $1.2 million increase in outside data services. These year-over-year increases were offset by the $9.2 million decrease in compensation and benefits, as the prior year period included $8.2 million pension termination expense and $1.9 million of severance related expenses associated with staffing adjustments.

For the nine months ended September 30, 2024, the GAAP efficiency ratio was 69.98% compared to 64.29% for the same period in 2023. The non-GAAP efficiency ratio for the current year was 67.04% compared to 59.42% for the prior year. The growth in the current year’s GAAP and non-GAAP efficiency ratios compared to the prior year, indicating a decline in efficiency, was the result of the declines in GAAP and non-GAAP revenues combined with the growth in GAAP and non-GAAP non-interest expenses.

Explanation of Non-GAAP Financial Measures

This news release contains financial information and performance measures determined by methods other than in accordance with generally accepted accounting principles in the United States (“GAAP”). The Company’s management believes that the supplemental non-GAAP information provides a better comparison of period-to-period operating performance. Additionally, the Company believes this information is utilized by regulators and market analysts to evaluate a company’s financial condition and, therefore, such information is useful to investors. Non-GAAP measures used in this release consist of the following:

• Tangible common equity and related measures are non-GAAP measures that exclude the impact of goodwill and other intangible assets.
• The non-GAAP efficiency ratio excludes amortization of intangible assets, investment securities gains/(losses), severance expense, contingent payment expense, and includes tax-equivalent income.
• Core earnings and the related measures of core earnings per diluted common share, core return on average assets and core return on average tangible common equity reflect net income exclusive of amortization of intangible assets, investment securities gains/(losses) and other non-recurring or extraordinary items, on a net of tax basis.
• Pre-tax pre-provision net income excludes income tax expense and the provision (credit) for credit losses.

These disclosures should not be viewed as a substitute for financial results in accordance with GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other companies. Please refer to the non-GAAP Reconciliation tables included with this release for a reconciliation of these non-GAAP measures to the most directly comparable GAAP measure.

Conference Call Cancelled

As a result of today’s announcement that the Company has entered into a merger agreement with Atlantic Union Bankshares Corporation, the Company has cancelled its conference call scheduled for 2:00 p.m. ET today to discuss the Company’s results for the third quarter of 2024.

About Sandy Spring Bancorp, Inc.

Sandy Spring Bancorp, Inc., headquartered in Olney, Maryland, is the holding company for Sandy Spring Bank, a premier community bank in the Greater Washington, D.C. region. With over 50 locations, the bank offers a broad range of commercial and retail banking, mortgage, private banking, and trust services throughout Maryland, Virginia, and Washington, D.C. Through its subsidiaries, Rembert Pendleton Jackson and West Financial Services, Inc., Sandy Spring Bank also offers a comprehensive menu of wealth management services.

Source: Sandy Spring Bancorp, Inc.
Code: SASR-E

For additional information or questions, please contact:

Daniel J. Schrider, Chair, President & Chief Executive Officer, or

Charles S. Cullum, E.V.P. & Chief Financial Officer

Sandy Spring Bancorp

17801 Georgia Avenue

Olney, Maryland 20832

1-800-399-5919

Email: DSchrider@sandyspringbank.com            CCullum@sandyspringbank.com

Website: www.sandyspringbank.com

Media Contact:

Jennifer E. Schell, Division Executive, Marketing & Corporate Communications

301-774-6400 x8331

jschell@sandyspringbank.com

Forward-Looking Statements

Sandy Spring Bancorp’s forward-looking statements are subject to significant risks and uncertainties that may cause actual results to differ materially from those in such statements. These risks and uncertainties include, but are not limited to, the risks identified in our quarterly and annual reports and the following: changes in general business and economic conditions nationally or in the markets that we serve; changes in consumer and business confidence, investor sentiment, or consumer spending or savings behavior; changes in the level of inflation; changes in the demand for loans, deposits and other financial services that we provide; the possibility that future credit losses may be higher than currently expected; the impact of the interest rate environment on our business, financial condition and results of operations; the impact of compliance with changes in laws, regulations and regulatory interpretations, including changes in income taxes; changes in credit ratings assigned to us or our subsidiaries; the ability to realize benefits and cost savings from, and limit any unexpected liabilities associated with, any business combinations; competitive pressures among financial services companies; the ability to attract, develop and retain qualified employees; our ability to maintain the security of our data processing and information technology systems; the impact of changes in accounting policies, including the introduction of new accounting standards; the impact of judicial or regulatory proceedings; the impact of fiscal and governmental policies of the United States federal government; the impact of health emergencies, epidemics or pandemics; the effects of climate change; and the impact of natural disasters, extreme weather events, military conflict, terrorism or other geopolitical events. Sandy Spring Bancorp provides greater detail regarding some of these factors in its Form 10-K for the year ended December 31, 2023, including in the Risk Factors section of that report, and in its other SEC reports. Sandy Spring Bancorp’s forward-looking statements may also be subject to other risks and uncertainties, including those that it may discuss elsewhere in this news release or in its filings with the SEC, accessible on the SEC’s Web site at www.sec.gov.

Sandy Spring Bancorp, Inc. and Subsidiaries
FINANCIAL HIGHLIGHTS - UNAUDITED

		Three Months Ended September 30,											Nine Months Ended September 30,
(Dollars in thousands, except per share data)			2024				2023			% Change				2024				2023			% Change
Results of operations:
Net interest income		$	81,412			$	85,081			(4	)%		$	241,040			$	272,854			(12	)%
Provision/ (credit) for credit losses			6,316				2,365			167	%			9,724				(14,116	)		N/M
Non-interest income			19,715				17,391			13				57,669				50,518			14
Non-interest expense			72,937				72,471			1				209,047				207,912			1
Income before income tax expense			21,874				27,636			(21	)			79,938				129,576			(38	)
Net income			16,209				20,746			(22	)			59,388				96,744			(39	)
Net income attributable to common shareholders		$	16,205			$	20,719			(22	)		$	59,351			$	96,552			(39	)
Pre-tax pre-provision net income (1)		$	28,190			$	30,001			(6	)		$	89,662			$	115,460			(22	)
Return on average assets			0.46	%			0.58	%						0.56	%			0.92	%
Return on average common equity			4.01	%			5.35	%						4.99	%			8.50	%
Return on average tangible common equity (1)			5.88	%			7.42	%						7.17	%			11.67	%
Net interest margin			2.44	%			2.55	%						2.44	%			2.75	%
Efficiency ratio - GAAP basis (2)			72.12	%			70.72	%						69.98	%			64.29	%
Efficiency ratio - Non-GAAP basis (2)			69.06	%			60.91	%						67.04	%			59.42	%
Per share data:
Basic net income per common share		$	0.36			$	0.46			(22	)%		$	1.32			$	2.16			(39	)%
Diluted net income per common share		$	0.36			$	0.46			(22	)		$	1.31			$	2.15			(39	)
Weighted average diluted common shares			45,242,920				44,960,455			1				45,156,521				44,912,803			1
Dividends declared per share		$	0.34			$	0.34			—			$	1.02			$	1.02			—
Book value per common share		$	36.10			$	34.26			5			$	36.10			$	34.26			5
Tangible book value per common share (1)		$	27.37			$	25.80			6			$	27.37			$	25.80			6
Outstanding common shares			45,125,078				44,895,158			1				45,125,078				44,895,158			1
Financial condition at period-end:
Investment securities		$	1,440,488			$	1,392,078			3	%		$	1,440,488			$	1,392,078			3	%
Loans			11,491,921				11,300,292			2				11,491,921				11,300,292			2
Assets			14,383,073				14,135,085			2				14,383,073				14,135,085			2
Deposits			11,737,694				11,151,012			5				11,737,694				11,151,012			5
Stockholders' equity			1,628,837				1,537,914			6				1,628,837				1,537,914			6
Capital ratios:
Tier 1 leverage (3)			9.59	%			9.50	%						9.59	%			9.50	%
Common equity tier 1 capital to risk-weighted assets (3)			11.27	%			10.83	%						11.27	%			10.83	%
Tier 1 capital to risk-weighted assets (3)			11.27	%			10.83	%						11.27	%			10.83	%
Total regulatory capital to risk-weighted assets (3)			15.53	%			14.85	%						15.53	%			14.85	%
Tangible common equity to tangible assets (4)			8.83	%			8.42	%						8.83	%			8.42	%
Average equity to average assets			11.37	%			10.92	%						11.32	%			10.84	%
Credit quality ratios:
Allowance for credit losses to loans			1.14	%			1.09	%						1.14	%			1.09	%
Non-performing loans to total loans			1.09	%			0.46	%						1.09	%			0.46	%
Non-performing assets to total assets			0.89	%			0.37	%						0.89	%			0.37	%
Allowance for credit losses to non-performing loans			104.92	%			238.32	%						104.92	%			238.32	%
Annualized net charge-offs/ (recoveries) to average loans (5)			0.03	%			—	%						0.02	%			0.02	%

N/M - not meaningful
(1)	Represents a non-GAAP measure.
(2)	The efficiency ratio - GAAP basis is non-interest expense divided by net interest income plus non-interest income from the Condensed Consolidated Statements of Income. The traditional efficiency ratio - Non-GAAP basis excludes intangible asset amortization, pension settlement expense, severance expense and contingent payment expense from non-interest expense; and investment securities gains/ (losses) from non-interest income; and adds the tax-equivalent adjustment to net interest income. See the Reconciliation Table included with these Financial Highlights.
(3)	Estimated ratio at September 30, 2024.
(4)	The tangible common equity to tangible assets ratio is a non-GAAP ratio that divides assets excluding goodwill and other intangible assets into stockholders' equity after deducting goodwill and other intangible assets. See the Reconciliation Table included with these Financial Highlights.
(5)	Calculation utilizes average loans, excluding residential mortgage loans held-for-sale.

Sandy Spring Bancorp, Inc. and Subsidiaries
RECONCILIATION TABLE - UNAUDITED (CONTINUED)
OPERATING EARNINGS - METRICS

		Three Months Ended September 30,								Nine Months Ended September 30,
(Dollars in thousands)			2024				2023				2024				2023
Core earnings (non-GAAP):
Net income (GAAP)		$	16,209			$	20,746			$	59,388			$	96,744
Plus/ (less) non-GAAP adjustments (net of tax)(1):
Amortization of intangible assets			1,727				932				4,864				2,851
Severance expense			—				—				—				1,445
Pension settlement expense			—				6,088				—				6,088
Contingent payment expense			—				—				—				27
Core earnings (Non-GAAP)		$	17,936			$	27,766			$	64,252			$	107,155
Core earnings per diluted common share (non-GAAP):
Weighted average common shares outstanding - diluted (GAAP)			45,242,920				44,960,455				45,156,521				44,912,803
Earnings per diluted common share (GAAP)		$	0.36			$	0.46			$	1.31			$	2.15
Core earnings per diluted common share (non-GAAP)		$	0.40			$	0.62			$	1.42			$	2.39
Core return on average assets (non-GAAP):
Average assets (GAAP)		$	14,136,037			$	14,086,342			$	14,051,722			$	14,043,925
Return on average assets (GAAP)			0.46	%			0.58	%			0.56	%			0.92	%
Core return on average assets (non-GAAP)			0.50	%			0.78	%			0.61	%			1.02	%
Return/ Core return on average tangible common equity (non-GAAP):
Net Income (GAAP)		$	16,209			$	20,746			$	59,388			$	96,744
Plus: Amortization of intangible assets (net of tax)			1,727				932				4,864				2,851
Net income before amortization of intangible assets		$	17,936			$	21,678			$	64,252			$	99,595
Average total stockholders' equity (GAAP)		$	1,607,377			$	1,538,553			$	1,590,682			$	1,522,153
Average goodwill			(363,436	)			(363,436	)			(363,436	)			(363,436	)
Average other intangible assets, net			(30,679	)			(16,777	)			(29,940	)			(18,068	)
Average tangible common equity (non-GAAP)		$	1,213,262			$	1,158,340			$	1,197,306			$	1,140,649
Return on average tangible common equity (non-GAAP)			5.88	%			7.42	%			7.17	%			11.67	%
Core return on average tangible common equity (non-GAAP)			5.88	%			9.51	%			7.17	%			12.56	%

(1)	Tax adjustments have been determined using the combined marginal federal and state rate of 25.48% and 25.37% for 2024 and 2023, respectively.

 

Sandy Spring Bancorp, Inc. and Subsidiaries
RECONCILIATION TABLE - UNAUDITED

		Three Months Ended September 30,								Nine Months Ended September 30,
(Dollars in thousands)			2024				2023				2024				2023
Pre-tax pre-provision net income:
Net income (GAAP)		$	16,209			$	20,746			$	59,388			$	96,744
Plus/ (less) non-GAAP adjustments:
Income tax expense			5,665				6,890				20,550				32,832
Provision/ (credit) for credit losses			6,316				2,365				9,724				(14,116	)
Pre-tax pre-provision net income (non-GAAP)		$	28,190			$	30,001			$	89,662			$	115,460
Efficiency ratio (GAAP):
Non-interest expense		$	72,937			$	72,471			$	209,047			$	207,912
Net interest income plus non-interest income		$	101,127			$	102,472			$	298,709			$	323,372
Efficiency ratio (GAAP)			72.12	%			70.72	%			69.98	%			64.29	%
Efficiency ratio (Non-GAAP):
Non-interest expense		$	72,937			$	72,471			$	209,047			$	207,912
Less non-GAAP adjustments:
Amortization of intangible assets			2,323				1,245				6,527				3,820
Severance expense			—				—				—				1,939
Pension settlement expense			—				8,157				—				8,157
Contingent payment expense			—				—				—				36
Non-interest expense - as adjusted		$	70,614			$	63,069			$	202,520			$	193,960
Net interest income plus non-interest income		$	101,127			$	102,472			$	298,709			$	323,372
Plus non-GAAP adjustment:
Tax-equivalent income			1,121				1,068				3,359				3,044
Less/ (plus) non-GAAP adjustment:
Investment securities gains/ (losses)			—				—				—				—
Net interest income plus non-interest income - as adjusted		$	102,248			$	103,540			$	302,068			$	326,416
Efficiency ratio (Non-GAAP)			69.06	%			60.91	%			67.04	%			59.42	%
Tangible common equity ratio:
Total stockholders' equity		$	1,628,837			$	1,537,914			$	1,628,837			$	1,537,914
Goodwill			(363,436	)			(363,436	)			(363,436	)			(363,436	)
Other intangible assets, net			(30,514	)			(16,035	)			(30,514	)			(16,035	)
Tangible common equity		$	1,234,887			$	1,158,443			$	1,234,887			$	1,158,443
Total assets		$	14,383,073			$	14,135,085			$	14,383,073			$	14,135,085
Goodwill			(363,436	)			(363,436	)			(363,436	)			(363,436	)
Other intangible assets, net			(30,514	)			(16,035	)			(30,514	)			(16,035	)
Tangible assets		$	13,989,123			$	13,755,614			$	13,989,123			$	13,755,614
Tangible common equity ratio			8.83	%			8.42	%			8.83	%			8.42	%
Outstanding common shares			45,125,078				44,895,158				45,125,078				44,895,158
Tangible book value per common share		$	27.37			$	25.80			$	27.37			$	25.80

Sandy Spring Bancorp, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF CONDITION - UNAUDITED

(Dollars in thousands)		September 30, 2024				December 31, 2023
Assets
Cash and due from banks		$	109,583			$	82,257
Federal funds sold			—				245
Interest-bearing deposits with banks			640,763				463,396
Cash and cash equivalents			750,346				545,898
Residential mortgage loans held for sale (at fair value)			21,489				10,836
SBA loans held for sale			425				—
Investments held-to-maturity (fair values of $189,853 and $200,411 at September 30, 2024 and December 31, 2023, respectively)			220,296				236,165
Investments available-for-sale (at fair value)			1,149,056				1,102,681
Other investments, at cost			71,136				75,607
Total loans			11,491,921				11,366,989
Less: allowance for credit losses - loans			(131,428	)			(120,865	)
Net loans			11,360,493				11,246,124
Premises and equipment, net			57,249				59,490
Other real estate owned			3,265				—
Accrued interest receivable			45,162				46,583
Goodwill			363,436				363,436
Other intangible assets, net			30,514				28,301
Other assets			310,206				313,051
Total assets		$	14,383,073			$	14,028,172
Liabilities
Noninterest-bearing deposits		$	2,903,063			$	2,914,161
Interest-bearing deposits			8,834,631				8,082,377
Total deposits			11,737,694				10,996,538
Securities sold under retail repurchase agreements			70,767				75,032
Federal Reserve Bank borrowings			—				300,000
Advances from FHLB			450,000				550,000
Subordinated debt			371,251				370,803
Total borrowings			892,018				1,295,835
Accrued interest payable and other liabilities			124,524				147,657
Total liabilities			12,754,236				12,440,030
Stockholders' equity
Common stock -- par value $1.00; shares authorized 100,000,000; shares issued and outstanding 45,125,078 and 44,913,561 at September 30, 2024 and December 31, 2023, respectively.			45,125				44,914
Additional paid in capital			748,202				742,243
Retained earnings			911,411				898,316
Accumulated other comprehensive loss			(75,901	)			(97,331	)
Total stockholders' equity			1,628,837				1,588,142
Total liabilities and stockholders' equity		$	14,383,073			$	14,028,172

Sandy Spring Bancorp, Inc. and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - UNAUDITED

		Three Months Ended September 30,						Nine Months Ended September 30,
(Dollars in thousands, except per share data)			2024			2023			2024			2023
Interest income:
Interest and fees on loans		$	154,339		$	147,304		$	456,309		$	431,305
Interest on mortgage loans held for sale			364			238			801			697
Interest on SBA loans held for sale			2			—			2			—
Interest on deposits with banks			6,191			6,371			17,401			13,979
Interest and dividend income on investment securities:
Taxable			7,440			6,682			21,319			20,538
Tax-advantaged			1,762			1,811			5,385			5,376
Interest on federal funds sold			—			5			8			13
Total interest income			170,098			162,411			501,225			471,908
Interest expense:
Interest on deposits			79,287			63,102			227,062			155,215
Interest on retail repurchase agreements and federal funds purchased			452			4,082			4,890			10,377
Interest on advances from FHLB			5,001			6,200			16,394			21,623
Interest on subordinated debt			3,946			3,946			11,839			11,839
Total interest expense			88,686			77,330			260,185			199,054
Net interest income			81,412			85,081			241,040			272,854
Provision/ (credit) for credit losses			6,316			2,365			9,724			(14,116	)
Net interest income after provision/ (credit) for credit losses			75,096			82,716			231,316			286,970
Non-interest income:
Service charges on deposit accounts			3,009			2,704			8,765			7,698
Mortgage banking activities			1,529			1,682			4,524			4,744
Wealth management income			10,738			9,391			31,151			27,414
Income from bank owned life insurance			1,307			845			4,283			3,003
Bank card fees			435			450			1,293			1,315
Other income			2,697			2,319			7,653			6,344
Total non-interest income			19,715			17,391			57,669			50,518
Non-interest expense:
Salaries and employee benefits			41,030			44,853			115,549			124,710
Occupancy expense of premises			4,657			4,609			14,278			14,220
Equipment expenses			3,841			3,811			11,672			11,688
Marketing			1,320			729			3,350			3,861
Outside data services			3,025			2,819			9,414			8,186
FDIC insurance			2,773			2,333			8,635			6,846
Amortization of intangible assets			2,323			1,245			6,527			3,820
Professional fees and services			6,577			4,509			16,403			12,354
Other expenses			7,391			7,563			23,219			22,227
Total non-interest expense			72,937			72,471			209,047			207,912
Income before income tax expense			21,874			27,636			79,938			129,576
Income tax expense			5,665			6,890			20,550			32,832
Net income		$	16,209		$	20,746		$	59,388		$	96,744
Net income per share amounts:
Basic net income per common share		$	0.36		$	0.46		$	1.32		$	2.16
Diluted net income per common share		$	0.36		$	0.46		$	1.31		$	2.15
Dividends declared per share		$	0.34		$	0.34		$	1.02		$	1.02

Sandy Spring Bancorp, Inc. and Subsidiaries
HISTORICAL TRENDS - QUARTERLY FINANCIAL DATA - UNAUDITED

			2024												2023
(Dollars in thousands, except per share data)		Q3				Q2				Q1				Q4				Q3				Q2				Q1
Profitability for the quarter:
Tax-equivalent interest income		$	171,219			$	166,252			$	167,113			$	166,729			$	163,479			$	159,156			$	152,317
Interest expense			88,686				84,828				86,671				83,920				77,330				67,679				54,045
Tax-equivalent net interest income			82,533				81,424				80,442				82,809				86,149				91,477				98,272
Tax-equivalent adjustment			1,121				1,139				1,099				1,113				1,068				1,006				970
Provision/ (credit) for credit losses			6,316				1,020				2,388				(3,445	)			2,365				5,055				(21,536	)
Non-interest income			19,715				19,587				18,367				16,560				17,391				17,176				15,951
Non-interest expense			72,937				68,104				68,006				67,142				72,471				69,136				66,305
Income before income tax expense			21,874				30,748				27,316				34,559				27,636				33,456				68,484
Income tax expense			5,665				7,941				6,944				8,459				6,890				8,711				17,231
Net income		$	16,209			$	22,807			$	20,372			$	26,100			$	20,746			$	24,745			$	51,253
GAAP financial performance:
Return on average assets			0.46	%			0.66	%			0.58	%			0.73	%			0.58	%			0.70	%			1.49	%
Return on average common equity			4.01	%			5.81	%			5.17	%			6.70	%			5.35	%			6.46	%			13.93	%
Return on average tangible common equity			5.88	%			8.27	%			7.39	%			9.26	%			7.42	%			8.93	%			19.10	%
Net interest margin			2.44	%			2.46	%			2.41	%			2.45	%			2.55	%			2.73	%			2.99	%
Efficiency ratio - GAAP basis			72.12	%			68.19	%			69.60	%			68.33	%			70.72	%			64.22	%			58.55	%
Non-GAAP financial performance:
Pre-tax pre-provision net income		$	28,190			$	31,768			$	29,704			$	31,114			$	30,001			$	38,511			$	46,948
Core after-tax earnings		$	17,936			$	24,400			$	21,916			$	27,147			$	27,766			$	27,136			$	52,253
Core return on average assets			0.50	%			0.70	%			0.63	%			0.76	%			0.78	%			0.77	%			1.52	%
Core return on average common equity			4.44	%			6.21	%			5.56	%			6.97	%			7.16	%			7.09	%			14.20	%
Core return on average tangible common equity			5.88	%			8.27	%			7.39	%			9.26	%			9.51	%			9.43	%			19.11	%
Core earnings per diluted common share		$	0.40			$	0.54			$	0.49			$	0.60			$	0.62			$	0.60			$	1.16
Efficiency ratio - Non-GAAP basis			69.06	%			65.31	%			66.73	%			66.16	%			60.91	%			60.68	%			56.87	%
Per share data:
Net income attributable to common shareholders		$	16,205			$	22,800			$	20,346			$	26,066			$	20,719			$	24,712			$	51,084
Basic net income per common share		$	0.36			$	0.51			$	0.45			$	0.58			$	0.46			$	0.55			$	1.14
Diluted net income per common share		$	0.36			$	0.51			$	0.45			$	0.58			$	0.46			$	0.55			$	1.14
Weighted average diluted common shares			45,242,920				45,145,214				45,086,471				45,009,574				44,960,455				44,888,759				44,872,582
Dividends declared per share		$	0.34			$	0.34			$	0.34			$	0.34			$	0.34			$	0.34			$	0.34
Non-interest income:
Service charges on deposit accounts			3,009				2,939				2,817				2,749				2,704				2,606				2,388
Mortgage banking activities			1,529				1,621				1,374				792				1,682				1,817				1,245
Wealth management income			10,738				10,455				9,958				9,219				9,391				9,031				8,992
Income from bank owned life insurance			1,307				1,816				1,160				1,207				845				1,251				907
Bank card fees			435				445				413				454				450				447				418
Other income			2,697				2,311				2,645				2,139				2,319				2,024				2,001
Total non-interest income		$	19,715			$	19,587			$	18,367			$	16,560			$	17,391			$	17,176			$	15,951
Non-interest expense:
Salaries and employee benefits		$	41,030			$	37,821			$	36,698			$	35,482			$	44,853			$	40,931			$	38,926
Occupancy expense of premises			4,657				4,805				4,816				4,558				4,609				4,764				4,847
Equipment expenses			3,841				3,868				3,963				3,987				3,811				3,760				4,117
Marketing			1,320				1,288				742				1,242				729				1,589				1,543
Outside data services			3,025				3,286				3,103				3,000				2,819				2,853				2,514
FDIC insurance			2,773				2,951				2,911				2,615				2,333				2,375				2,138
Amortization of intangible assets			2,323				2,135				2,069				1,403				1,245				1,269				1,306
Professional fees and services			6,577				4,946				4,880				5,628				4,509				4,161				3,684
Other expenses			7,391				7,004				8,824				9,227				7,563				7,434				7,230
Total non-interest expense		$	72,937			$	68,104			$	68,006			$	67,142			$	72,471			$	69,136			$	66,305

Sandy Spring Bancorp, Inc. and Subsidiaries
HISTORICAL TRENDS - QUARTERLY FINANCIAL DATA - UNAUDITED

			2024												2023
(Dollars in thousands, except per share data)		Q3				Q2				Q1				Q4				Q3				Q2				Q1
Balance sheets at quarter end:
Commercial investor real estate loans		$	4,868,467			$	4,933,329			$	4,997,879			$	5,104,425			$	5,137,694			$	5,131,210			$	5,167,456
Commercial owner-occupied real estate loans			1,737,327				1,747,708				1,741,113				1,755,235				1,760,384				1,770,135				1,769,928
Commercial AD&C loans			1,255,609				1,184,296				1,090,259				988,967				938,673				1,045,742				1,046,665
Commercial business loans			1,620,926				1,601,510				1,509,592				1,504,880				1,454,709				1,423,614				1,437,478
Residential mortgage loans			1,529,786				1,521,890				1,511,624				1,474,521				1,432,051				1,385,743				1,328,524
Residential construction loans			53,639				78,027				97,685				121,419				160,345				190,690				223,456
Consumer loans			426,167				417,161				416,132				417,542				416,436				422,505				421,734
Total loans			11,491,921				11,483,921				11,364,284				11,366,989				11,300,292				11,369,639				11,395,241
Allowance for credit losses - loans			(131,428	)			(125,863	)			(123,096	)			(120,865	)			(123,360	)			(120,287	)			(117,613	)
Residential mortgage loans held for sale			21,489				18,961				16,627				10,836				19,235				21,476				16,262
SBA loans held for sale			425				—				—				—				—				—				—
Investment securities			1,440,488				1,401,511				1,405,490				1,414,453				1,392,078				1,463,554				1,528,336
Total assets			14,383,073				14,008,343				13,888,133				14,028,172				14,135,085				13,994,545				14,129,007
Noninterest-bearing demand deposits			2,903,063				2,931,405				2,817,928				2,914,161				3,013,905				3,079,896				3,228,678
Total deposits			11,737,694				11,340,228				11,227,200				10,996,538				11,151,012				10,958,922				11,075,991
Customer repurchase agreements			70,767				75,038				71,529				75,032				66,581				74,510				47,627
Total stockholders' equity			1,628,837				1,599,004				1,589,364				1,588,142				1,537,914				1,539,032				1,536,865
Quarterly average balance sheets:
Commercial investor real estate loans		$	4,874,003			$	4,964,406			$	5,057,334			$	5,125,028			$	5,125,459			$	5,146,632			$	5,136,204
Commercial owner-occupied real estate loans			1,741,663				1,734,106				1,746,042				1,755,048				1,769,717				1,773,039				1,769,680
Commercial AD&C loans			1,253,035				1,133,506				1,030,763				960,646				995,682				1,057,205				1,082,791
Commercial business loans			1,579,001				1,551,798				1,508,336				1,433,035				1,442,518				1,441,489				1,444,588
Residential mortgage loans			1,526,445				1,518,748				1,491,277				1,451,614				1,406,929				1,353,809				1,307,761
Residential construction loans			64,684				86,638				110,456				142,325				174,204				211,590				223,313
Consumer loans			421,003				417,206				417,539				419,299				421,189				423,306				424,122
Total loans			11,459,834				11,406,408				11,361,747				11,286,995				11,335,698				11,407,070				11,388,459
Residential mortgage loans held for sale			19,889				14,497				8,142				10,132				13,714				17,480				8,324
SBA loans held for sale			65				—				—				—				—				—				—
Investment securities			1,531,378				1,538,624				1,536,127				1,544,173				1,589,342				1,639,324				1,679,593
Interest-earning assets			13,474,697				13,292,995				13,411,810				13,462,583				13,444,117				13,423,589				13,316,165
Total assets			14,136,037				13,956,261				14,061,935				14,090,423				14,086,342				14,094,653				13,949,276
Noninterest-bearing demand deposits			2,783,906				2,790,620				2,730,295				2,958,254				3,041,101				3,137,971				3,480,433
Total deposits			11,483,524				11,245,476				11,086,145				11,089,587				11,076,724				10,928,038				11,049,991
Customer repurchase agreements			63,436				62,161				72,836				66,622				67,298				58,382				60,626
Total interest-bearing liabilities			9,600,905				9,441,015				9,583,074				9,418,666				9,332,617				9,257,652				8,806,720
Total stockholders' equity			1,607,377				1,579,582				1,584,902				1,546,312				1,538,553				1,535,465				1,491,929
Financial measures:
Average equity to average assets			11.37	%			11.32	%			11.27	%			10.97	%			10.92	%			10.89	%			10.70	%
Average investment securities to average earning assets			11.36	%			11.57	%			11.45	%			11.47	%			11.82	%			12.21	%			12.61	%
Average loans to average earning assets			85.05	%			85.81	%			84.71	%			83.84	%			84.32	%			84.98	%			85.52	%
Loans to assets			79.90	%			81.98	%			81.83	%			81.03	%			79.94	%			81.24	%			80.65	%
Loans to deposits			97.91	%			101.27	%			101.22	%			103.37	%			101.34	%			103.75	%			102.88	%
Assets under management		$	6,567,752			$	6,215,697			$	6,165,509			$	5,999,520			$	5,536,499			$	5,742,888			$	5,477,560
Capital measures:
Tier 1 leverage (1)			9.59	%			9.70	%			9.56	%			9.51	%			9.50	%			9.42	%			9.44	%
Common equity tier 1 capital to risk-weighted assets (1)			11.27	%			11.28	%			10.96	%			10.90	%			10.83	%			10.65	%			10.53	%
Tier 1 capital to risk-weighted assets (1)			11.27	%			11.28	%			10.96	%			10.90	%			10.83	%			10.65	%			10.53	%
Total regulatory capital to risk-weighted assets (1)			15.53	%			15.49	%			15.05	%			14.92	%			14.85	%			14.60	%			14.43	%
Book value per common share		$	36.10			$	35.45			$	35.37			$	35.36			$	34.26			$	34.31			$	34.37
Outstanding common shares			45,125,078				45,109,671				44,940,147				44,913,561				44,895,158				44,862,369				44,712,497

(1) Estimated ratio at September 30, 2024.

Sandy Spring Bancorp, Inc. and Subsidiaries
LOAN PORTFOLIO QUALITY DETAIL - UNAUDITED

			2024									2023
(Dollars in thousands)		September 30,			June 30,			March 31,			December 31,			September 30,			June 30,			March 31,
Non-performing assets:
Loans 90 days past due:
Commercial real estate:
Commercial investor real estate		$	—		$	—		$	—		$	—		$	—		$	—		$	215
Commercial owner-occupied real estate			—			—			—			—			—			—			—
Commercial AD&C			—			—			—			—			—			—			—
Commercial business			—			—			20			20			415			29			3,002
Residential real estate:
Residential mortgage			399			338			340			342			—			692			352
Residential construction			—			—			—			—			—			—			—
Consumer			—			—			—			—			—			—			—
Total loans 90 days past due			399			338			360			362			415			721			3,569
Non-accrual loans:
Commercial real estate:
Commercial investor real estate			57,578			55,498			55,579			58,658			20,108			20,381			15,451
Commercial owner-occupied real estate			9,639			9,403			4,394			4,640			4,744			4,846			4,949
Commercial AD&C			31,816			2,127			556			1,259			1,422			569			—
Commercial business			9,044			8,455			7,164			10,051			9,671			9,393			9,443
Residential real estate:
Residential mortgage			11,996			12,228			11,835			12,332			10,766			10,153			8,935
Residential construction			539			539			542			443			449			—			—
Consumer			4,258			4,400			4,011			4,102			4,187			3,396			4,900
Total non-accrual loans			124,870			92,650			84,081			91,485			51,347			48,738			43,678
Total non-performing loans			125,269			92,988			84,441			91,847			51,762			49,459			47,247
Other real estate owned (OREO)			3,265			2,700			2,700			—			261			611			645
Total non-performing assets		$	128,534		$	95,688		$	87,141		$	91,847		$	52,023		$	50,070		$	47,892

		For the Quarter Ended,
(Dollars in thousands)		September 30, 2024				June 30, 2024				March 31, 2024				December 31, 2023				September 30, 2023				June 30, 2023				March 31, 2023
Analysis of non-accrual loan activity:
Balance at beginning of period		$	92,650			$	84,081			$	91,485			$	51,347			$	48,738			$	43,678			$	34,782
Non-accrual balances transferred to OREO			(565	)			—				(2,700	)			—				—				—				—
Non-accrual balances charged-off			(787	)			—				(1,550	)			—				(183	)			(2,049	)			(126	)
Net payments or draws			(3,095	)			(1,427	)			(4,017	)			(7,619	)			(1,545	)			(1,654	)			(10,212	)
Loans placed on non-accrual			36,667				10,038				1,490				47,920				4,967				9,276				19,714
Non-accrual loans brought current			—				(42	)			(627	)			(163	)			(630	)			(513	)			(480	)
Balance at end of period		$	124,870			$	92,650			$	84,081			$	91,485			$	51,347			$	48,738			$	43,678
Analysis of allowance for credit losses - loans:
Balance at beginning of period		$	125,863			$	123,096			$	120,865			$	123,360			$	120,287			$	117,613			$	136,242
Provision/ (credit) for credit losses - loans			6,310				2,961				3,331				(2,574	)			3,171				4,454				(18,945	)
Less loans charged-off, net of recoveries:
Commercial real estate:
Commercial investor real estate			397				(3	)			(2	)			(3	)			(3	)			(14	)			(5	)
Commercial owner-occupied real estate			(27	)			(27	)			(27	)			(27	)			(25	)			(27	)			(26	)
Commercial AD&C			111				(23	)			(283	)			—				—				—				—
Commercial business			250				(28	)			1,550				(105	)			15				363				(127	)
Residential real estate:
Residential mortgage			(35	)			39				(6	)			(6	)			(4	)			35				21
Residential construction			—				—				—				—				—				—				—
Consumer			49				236				(132	)			62				115				1,423				(179	)
Net charge-offs/ (recoveries)			745				194				1,100				(79	)			98				1,780				(316	)
Balance at the end of period		$	131,428			$	125,863			$	123,096			$	120,865			$	123,360			$	120,287			$	117,613
Asset quality ratios:
Non-performing loans to total loans			1.09	%			0.81	%			0.74	%			0.81	%			0.46	%			0.44	%			0.41	%
Non-performing assets to total assets			0.89	%			0.68	%			0.63	%			0.65	%			0.37	%			0.36	%			0.34	%
Allowance for credit losses to loans			1.14	%			1.10	%			1.08	%			1.06	%			1.09	%			1.06	%			1.03	%
Allowance for credit losses to non-performing loans			104.92	%			135.35	%			145.78	%			131.59	%			238.32	%			243.21	%			248.93	%
Annualized net charge-offs/ (recoveries) to average loans			0.03	%			0.01	%			0.04	%			—	%			—	%			0.06	%		(0.01		)%

Sandy Spring Bancorp, Inc. and Subsidiaries
CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES - UNAUDITED

		Three Months Ended September 30,
			2024										2023
(Dollars in thousands and tax-equivalent)		Average Balances				Interest (1)			Annualized Average Yield/Rate			Average Balances				Interest (1)			Annualized Average Yield/Rate
Assets
Commercial investor real estate loans		$	4,874,003			$	58,133		4.74	%		$	5,125,459			$	60,482		4.68	%
Commercial owner-occupied real estate loans			1,741,663				21,609		4.94				1,769,717				20,865		4.68
Commercial AD&C loans			1,253,035				24,553		7.80				995,682				20,503		8.17
Commercial business loans			1,579,001				26,953		6.79				1,442,518				23,343		6.42
Total commercial loans			9,447,702				131,248		5.53				9,333,376				125,193		5.32
Residential mortgage loans			1,526,445				14,223		3.73				1,406,929				12,550		3.57
Residential construction loans			64,684				876		5.39				174,204				1,680		3.83
Consumer loans			421,003				8,653		8.18				421,189				8,491		8.00
Total residential and consumer loans			2,012,132				23,752		4.71				2,002,322				22,721		4.52
Total loans (2)			11,459,834				155,000		5.38				11,335,698				147,914		5.18
Residential mortgage loans held for sale			19,889				364		7.32				13,714				238		6.93
SBA loans held for sale			65				2		11.28				—				—		—
Taxable securities			1,197,301				7,440		2.49				1,239,564				6,682		2.16
Tax-advantaged securities			334,077				2,222		2.66				349,778				2,269		2.59
Total investment securities (3)			1,531,378				9,662		2.52				1,589,342				8,951		2.25
Interest-bearing deposits with banks			463,531				6,191		5.31				505,017				6,371		5.00
Federal funds sold			—				—		—				346				5		5.38
Total interest-earning assets			13,474,697				171,219		5.06				13,444,117				163,479		4.83
Less: allowance for credit losses - loans			(125,962	)									(122,348	)
Cash and due from banks			82,172										93,354
Premises and equipment, net			58,035										71,956
Other assets			647,095										599,263
Total assets		$	14,136,037									$	14,086,342
Liabilities and Stockholders' Equity
Interest-bearing demand deposits		$	1,427,739			$	6,256		1.74	%		$	1,419,934			$	4,229		1.18	%
Regular savings deposits			1,718,475				15,341		3.55				861,634				5,571		2.57
Money market savings deposits			3,018,799				28,999		3.82				2,866,744				25,122		3.48
Time deposits			2,534,605				28,691		4.50				2,887,311				28,180		3.87
Total interest-bearing deposits			8,699,618				79,287		3.63				8,035,623				63,102		3.12
Repurchase agreements			63,436				334		2.09				67,298				356		2.10
Federal funds purchased and Federal Reserve Bank borrowings			8,543				118		5.53				300,435				3,726		4.92
Advances from FHLB			458,152				5,001		4.34				558,696				6,200		4.40
Subordinated debt			371,156				3,946		4.25				370,565				3,946		4.26
Total borrowings			901,287				9,399		4.15				1,296,994				14,228		4.35
Total interest-bearing liabilities			9,600,905				88,686		3.68				9,332,617				77,330		3.29
Noninterest-bearing demand deposits			2,783,906										3,041,101
Other liabilities			143,849										174,071
Stockholders' equity			1,607,377										1,538,553
Total liabilities and stockholders' equity		$	14,136,037									$	14,086,342
Tax-equivalent net interest income and spread						$	82,533		1.38	%						$	86,149		1.54	%
Less: tax-equivalent adjustment							1,121										1,068
Net interest income						$	81,412									$	85,081
Interest income/earning assets									5.06	%									4.83	%
Interest expense/earning assets									2.62										2.28
Net interest margin									2.44	%									2.55	%

(1)	Tax-equivalent income has been adjusted using the combined marginal federal and state rate of 25.48% and 25.37% for 2024 and 2023, respectively. The annualized taxable-equivalent adjustments utilized in the above table to compute yields aggregated to $1.1 million and $1.1 million in 2024 and 2023, respectively.
(2)	Non-accrual loans are included in the average balances.
(3)	Available-for-sale investments are presented at amortized cost.

Sandy Spring Bancorp, Inc. and Subsidiaries
CONSOLIDATED AVERAGE BALANCES, YIELDS AND RATES - UNAUDITED

		Nine Months Ended September 30,
			2024										2023
(Dollars in thousands and tax-equivalent)		Average Balances				Interest (1)			Annualized Average Yield/Rate			Average Balances				Interest (1)			Annualized Average Yield/Rate
Assets
Commercial investor real estate loans		$	4,964,914			$	176,504		4.75	%		$	5,136,059			$	177,067		4.61	%
Commercial owner-occupied real estate loans			1,740,608				63,090		4.84				1,770,812				61,038		4.61
Commercial AD&C loans			1,139,517				68,779		8.06				1,044,907				61,005		7.81
Commercial business loans			1,546,498				79,026		6.83				1,442,858				68,258		6.33
Total commercial loans			9,391,537				387,399		5.51				9,394,636				367,368		5.23
Residential mortgage loans			1,512,209				41,968		3.70				1,356,530				35,925		3.53
Residential construction loans			87,177				3,208		4.92				202,856				5,302		3.49
Consumer loans			418,591				25,693		8.20				422,861				24,403		7.72
Total residential and consumer loans			2,017,977				70,869		4.69				1,982,247				65,630		4.42
Total loans (2)			11,409,514				458,268		5.36				11,376,883				432,998		5.09
Residential mortgage loans held for sale			14,197				801		7.52				13,192				697		7.04
SBA loans held for sale			22				2		11.28				—				—		—
Taxable securities			1,195,481				21,319		2.38				1,275,407				20,538		2.15
Tax-advantaged securities			339,881				6,785		2.66				360,348				6,727		2.49
Total investment securities (3)			1,535,362				28,104		2.44				1,635,755				27,265		2.22
Interest-bearing deposits with banks			434,083				17,401		5.35				368,829				13,979		5.07
Federal funds sold			288				8		3.79				433				13		4.00
Total interest-earning assets			13,393,466				504,584		5.03				13,395,092				474,952		4.74
Less: allowance for credit losses - loans			(122,971	)									(125,558	)
Cash and due from banks			83,265										94,960
Premises and equipment, net			59,124										70,130
Other assets			638,838										609,301
Total assets		$	14,051,722									$	14,043,925
Liabilities and Stockholders' Equity
Interest-bearing demand deposits		$	1,467,517			$	18,858		1.72	%		$	1,413,876			$	10,465		0.99	%
Regular savings deposits			1,602,997				42,597		3.55				660,211				7,831		1.59
Money market savings deposits			2,847,006				79,190		3.72				3,067,810				68,976		3.01
Time deposits			2,586,639				86,417		4.46				2,658,225				67,943		3.42
Total interest-bearing deposits			8,504,159				227,062		3.57				7,800,122				155,215		2.66
Repurchase agreements			66,134				1,043		2.11				62,126				561		1.21
Federal funds purchased and Federal Reserve Bank borrowings			99,303				3,847		5.17				264,580				9,816		4.96
Advances from FHLB			501,277				16,394		4.37				637,015				21,623		4.54
Subordinated debt			371,009				11,839		4.25				370,412				11,839		4.26
Total borrowings			1,037,723				33,123		4.26				1,334,133				43,839		4.39
Total interest-bearing liabilities			9,541,882				260,185		3.64				9,134,255				199,054		2.91
Noninterest-bearing demand deposits			2,768,331										3,218,226
Other liabilities			150,827										169,291
Stockholders' equity			1,590,682										1,522,153
Total liabilities and stockholders' equity		$	14,051,722									$	14,043,925
Tax-equivalent net interest income and spread						$	244,399		1.39	%						$	275,898		1.83	%
Less: tax-equivalent adjustment							3,359										3,044
Net interest income						$	241,040									$	272,854
Interest income/earning assets									5.03	%									4.74	%
Interest expense/earning assets									2.59										1.99
Net interest margin									2.44	%									2.75	%

(1)	Tax-equivalent income has been adjusted using the combined marginal federal and state rate of 25.48% and 25.37% for 2024 and 2023, respectively. The annualized taxable-equivalent adjustments utilized in the above table to compute yields aggregated to $3.4 million and $3.0 million in 2024 and 2023, respectively.
(2)	Non-accrual loans are included in the average balances.
(3)	Available-for-sale investments are presented at amortized cost.