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Associated Reports Fourth Quarter Earnings of $0.26 per share



        Associated Reports Fourth Quarter Earnings of $0.26 per share

Full year net income to common shareholders up 51% from a year ago

PR Newswire

GREEN BAY, Wis., Jan. 17, 2013

GREEN BAY, Wis., Jan. 17, 2013 /PRNewswire/ -- Associated Banc-Corp (NASDAQ:
ASBC) today reported net income to common shareholders of $45 million, or
$0.26 per common share, for the quarter ended December 31, 2012. This compares
to net income to common shareholders of $40 million, or $0.23 per common
share, for the quarter ended December 31, 2011.

For the year ended December 31, 2012, the Company reported net income to
common shareholders of $174 million, or $1.00 per common share.  This compares
to net income to common shareholders of $115 million, or $0.66 per common
share for the year ended December 31, 2011.

"This year's strong performance was the result of the commitment of our
colleagues to serving the needs of customers across the footprint," said
President and CEO Philip B. Flynn.  "We are proud to have restored Associated
to its position as a strong Upper Midwestern franchise and we are pleased to
have been able to deliver value for our shareholders over the course of 2012. 
We continue to be encouraged by the momentum throughout the company and we
look forward to the opportunity to continue to grow Associated."

HIGHLIGHTS   

  o Full year 2012 net income to common shareholders of $174 million, up 51%
    from a year ago

       o Fourth quarter net income to common shareholders of $45 million

  o Return on Tier 1 common equity for full year 2012 of 9.5%, compared to
    6.7% for full year 2011
  o Loan balances have grown by $1.4 billion, or 10%, from a year ago to $15.4
    billion

       o Loans increased by $445 million, or 3%, during the fourth quarter
       o Total commercial loan balances grew by $426 million, or 5% from the
         third quarter and accounted for the majority of the quarter's net
         loan growth

  o Average deposits for the fourth quarter increased by $1.8 billion, or 12%
    from a year ago to $16.7 billion

       o Average deposits increased by $1.0 billion, or 7%, from the third
         quarter

  o Credit quality continued to improve with net charge offs, nonaccrual
    loans, and potential problem loans all declining from the prior year
  o Quarterly dividend increased to $0.08 per common share in the fourth
    quarter, up from $0.05 per common share
  o During the fourth quarter, the Company repurchased $30 million, or
    approximately 2 million shares, of common stock at an average cost of
    $12.70
  o Capital ratios remain very strong with a Tier 1 common equity ratio of
    11.58%

FOURTH QUARTER 2012 FINANCIAL RESULTS

Loans

At December 31, 2012, the Company's loan portfolio was $15.4 billion, up $445
million, or 3%, from $15.0 billion at September 30, 2012.  For full year 2012,
loans increased by $1.4 billion, or 10%, from $14.0 billion a year ago. 

Commercial and business lending balances increased by $262 million, or 5% from
the prior quarter.  Commercial real estate lending balances grew by $164
million, or 5% on a linked-quarter basis.  The residential mortgage portfolio
grew by $172 million, or 5%, during the quarter while the retail portfolio,
which includes home equity and installment loan balances, experienced net
run-off of $153 million during the quarter.

Deposits

Average deposits of $16.7 billion were up $1.0 billion, or 7%, from the third
quarter.  On a full year basis, average deposits increased by $1.2 billion, or
8%, from a year ago. 

Total deposits of $16.9 billion at the end of the fourth quarter were up $489
million, or 3%, compared to third quarter levels.  Period-end
noninterest-bearing account balances grew by $439 million, or 10%, from the
third quarter, and have increased by $831 million, or 21%, from a year ago. 
The increase in fourth quarter noninterest-bearing deposit balances was
partially the result of customers' seasonal year-end account activity. 
Interest-bearing demand balances increased by $324 million, or 15%, from the
third quarter, and have increased by $257 million, or 11%, from a year ago. 
During the quarter, the Company continued to reduce its reliance on higher
cost funding sources, including term repurchase agreements, which were down
$334 million, and brokered and other CD balances, which were down $103 million
from the prior quarter.

Net Interest Income and Net Interest Margin

Fourth quarter net interest income of $161 million increased by $6 million, or
4%, compared to the prior quarter and was up 6% compared to the year-ago
quarter.  Net interest income for the fourth quarter included $2 million of
interest related to a tax refund.  For the full year, net interest income of
$626 million increased by $13 million, or 2% from the prior year.

The net interest margin for the fourth quarter was 3.32%, which included a 3
basis point benefit related to interest received on the tax refund.  On a full
year basis, the net interest margin was 3.30% compared to 3.26% for full year
2011. 

Fourth quarter net interest margin benefited from an 11 basis point decline in
the cost of deposits and interest-bearing liabilities, partially offset by a 4
basis point decline in loan yields, contributing to a net increase in overall
net interest margin of 6 basis points compared to the prior quarter. 

Noninterest Income and Expense

Noninterest income for the quarter was $78 million, down $3 million, or 4%,
from the third quarter.  Noninterest income for the full year was $313
million, up 15% from full year 2011.

The decline in fourth quarter fee income was primarily attributable to the
establishment of a $3 million repurchase reserve against previously sold
mortgage loans that reduced net mortgage banking income during the quarter.

Total noninterest expense for the quarter ended December 31, 2012 was $176
million, up $7 million, or 4%, from the third quarter.  For the full year,
noninterest expense increased by 5% to $682 million. 

Personnel and occupancy expenses increased by $6 million during the fourth
quarter which included $4 million of severance cost and lease breakage expense
related to the Company's recently announced efficiency initiatives. 

Credit

The Company reported another quarter of improving credit quality with
nonaccrual loans down 9%, to $253 million compared to the third quarter, and
down 29% from a year ago.  Nonaccrual loans to total loans now stand at 1.64%
and have improved for the 11^th consecutive quarter.  Nonperforming assets
declined 8% from the prior quarter to $288 million, and have declined 28% from
a year ago. 

Net charge offs of $21 million for the fourth quarter were up $3 million from
the third quarter, and were $2 million lower than a year ago.  For the full
year, net charge offs declined by 44% to $84 million.

Fourth quarter provision for loan losses was $3 million.  The Company's
allowance for loan losses was $297 million, representing an allowance equal to
1.93% of loans and representing a coverage ratio of over 117% of nonaccrual
loans at December 31, 2012.

Taxes

Income tax expense was lower by $7 million compared to the third quarter, due
to a net $5 million income tax benefit recorded during the
period, primarily related to the reversal of certain prior years' tax
reserves.

Capital Ratios

The Company's capital position remains very strong, with a Tier 1 common
equity ratio of 11.58% at December 31, 2012.  The Company's capital ratios
continue to be well in excess of both current and proposed "well-capitalized"
regulatory benchmarks.

FOURTH QUARTER 2012 EARNINGS RELEASE CONFERENCE CALL

The Company will host a conference call for investors and analysts at 4:00
p.m. Central Time (CT) today, January 17, 2013.  Interested parties can listen
to the call live on the Internet through the investor relations section of the
Company's website, http://investor.associatedbank.com/ or by dialing
877-317-6016. The slide presentation for the call will be available on the
Company's website just prior to the call. The number for international callers
is 412-317-6016. Participants should ask the operator for the Associated
Banc-Corp fourth quarter 2012 earnings call.

An audio archive of the webcast will be available on the Company's website.  A
telephone replay will be available two hours after the completion of the call
through 8:00 a.m. CT on February 18, 2013, by dialing 877-344-7529 and
entering the conference ID number 10022452. The replay number for
international callers is 412-317-0088.

ABOUT ASSOCIATED BANC-CORP

Associated Banc-Corp (NASDAQ: ASBC) has total assets of $24 billion and is one
of the top 50, publicly traded, U.S. bank holding companies.  Headquartered in
Green Bay, Wis., Associated is a leading Midwest banking franchise, offering a
full range of financial products and services through more than 250 banking
locations serving more than 150 communities throughout Wisconsin, Illinois and
Minnesota, and commercial financial services in Indiana, Michigan, Missouri,
Ohio and Texas. Associated Bank, N.A. is an Equal Housing Lender, Equal
Opportunity Lender and Member FDIC.  More information about Associated
Banc-Corp is available at www.associatedbank.com.

FORWARD LOOKING STATEMENTS

Statements made in this document which are not purely historical are
forward-looking statements, as defined in the Private Securities Litigation
Reform Act of 1995. This includes any statements regarding management's plans,
objectives, or goals for future operations, products or services, and
forecasts of its revenues, earnings, or other measures of performance.  Such
forward-looking statements may be identified by the use of words such as
"believe", "expect", "anticipate", "plan", "estimate", "should", "will",
"intend", "outlook", or similar expressions.  Forward-looking statements are
based on current management expectations and, by their nature, are subject to
risks and uncertainties. Actual results may differ materially from those
contained in the forward-looking statements.  Factors which may cause actual
results to differ materially from those contained in such forward-looking
statements include those identified in the Company's most recent Form 10-K and
subsequent SEC filings.  Such factors are incorporated herein by reference. 

Investor Contact:

Tim Sedabres, VP of Finance, Investor Relations

920-491-7059

 

Media Contact:

Autumn Latimore, Senior Vice President, Public Relations Director

414-278-1860

 

Consolidated Balance Sheets (Unaudited)
Associated Banc-Corp
                     December    September   Seql Qtr   June 30,    March 31,   December    Comp Qtr
                     31,         30,                                            31,
(in thousands)       2012        2012        $ Change   2012        2012        2011        $ Change
Assets
Cash and due from    $           $           $          $           $           $           $    
banks                 563,304    419,529      143,775    414,760     360,728     454,958    108,346
Interest-bearing
deposits in other    147,434     531,303     (383,869)  180,050     344,148     154,562     (7,128)
financial
institutions
Federal funds sold
and securities
purchased under      27,135      2,460       24,675     3,800       7,100       7,075       20,060
agreements to
resell
Securities held to
maturity, at         39,877      21,852      18,025     -           -           -           39,877
amortized cost
Securities
available for sale,  4,926,758   4,496,198   430,560    4,521,436   4,669,100   4,937,483   (10,725)
at fair value
Federal Home Loan
Bank and Federal 
   Reserve Bank      166,774     166,100     674        176,041     177,808     191,188     (24,414)
stocks, at cost
Loans held for sale  261,410     157,093     104,317    157,481     196,570     249,195     12,215
Loans                15,411,022  14,966,214  444,808    14,698,902  14,253,725  14,031,071  1,379,951
Allowance for loan   (297,409)   (315,150)   17,741     (332,658)   (356,298)   (378,151)   80,742
losses
    Loans, net       15,113,613  14,651,064  462,549    14,366,244  13,897,427  13,652,920  1,460,693
Premises and         253,958     238,756     15,202     225,245     225,164     223,736     30,222
equipment, net
Goodwill             929,168     929,168     -          929,168     929,168     929,168     -
Other intangible     61,176      61,294      (118)      64,812      68,374      67,574      (6,398)
assets, net
Trading assets       70,711      76,159      (5,448)    73,484      69,081      73,253      (2,542)
Other assets         970,472     987,378     (16,906)   968,579     969,002     983,105     (12,633)
    Total assets     $           22,738,354  $          $           $           $           $
                     23,531,790               793,436   22,081,100  21,913,670  21,924,217   1,607,573
Liabilities and
Stockholders'
Equity
Noninterest-bearing  $           4,320,437   $          $           $           $           $    
demand deposits      4,759,556                439,119   3,874,429   3,989,156   3,928,792   830,764
Interest-bearing     12,180,309  12,130,155  50,154     11,232,442  11,664,220  11,161,863  1,018,446
deposits
    Total deposits   16,939,865  16,450,592  489,273    15,106,871  15,653,376  15,090,655  1,849,210
Federal funds
purchased and
securities sold      750,455     1,138,027   (387,572)  1,253,270   1,236,219   1,514,485   (764,030)
under agreements to
repurchase
Other short-term     1,576,484   615,258     961,226    1,400,000   700,000     1,000,000   576,484
funding
Long-term funding    1,015,346   1,305,422   (290,076)  1,150,729   1,176,736   1,177,071   (161,725)
Trading liabilities  76,343      82,861      (6,518)    80,107      75,130      80,046      (3,703)
Accrued expenses
and other            236,898     195,742     41,156     180,502     171,336     196,166     40,732
liabilities
    Total            20,595,391  19,787,902  807,489    19,171,479  19,012,797  19,058,423  1,536,968
liabilities
Stockholders'
Equity
  Preferred equity   63,272      63,272      -          63,272      63,272      63,272      -
  Common stock       1,750       1,750       -          1,750       1,750       1,746       4
  Surplus            1,602,136   1,599,070   3,066      1,594,995   1,590,336   1,586,401   15,735
  Retained earnings  1,281,811   1,250,189   31,622     1,213,735   1,181,247   1,148,773   133,038
  Accumulated other
comprehensive        48,603      67,303      (18,700)   66,579      65,278      65,602      (16,999)
income 
  Treasury stock     (61,173)    (31,132)    (30,041)   (30,710)    (1,010)     -           (61,173)
    Total
stockholders'        2,936,399   2,950,452   (14,053)   2,909,621   2,900,873   2,865,794   70,605
equity
    Total
liabilities and      $           22,738,354  $          $           $           $           $
stockholders'        23,531,790               793,436   22,081,100  21,913,670  21,924,217   1,607,573
equity

 

Consolidated Statements of Income (Unaudited)
Associated
Banc-Corp
                  For The Three                        For The Year
                  Months Ended                         Ended,
                  December 31,      Quarter            December 31,        Year-to-Date
(in thousands,                                                                      %
except per share  2012     2011     $ Change % Change  2012      2011      $ Change Change
amounts)
Interest Income
Interest and      $        $        $        0.2%      $         $         $        2.3%
fees on loans     150,107  149,832    275               595,965   582,739   13,226
Interest and
dividends on
investment
securities:
  Taxable         20,368   22,855   (2,487)  (10.9%)   86,945    123,371   (36,426) (29.5%)
  Tax-exempt      7,119    7,344    (225)    (3.1%)    28,655    29,937    (1,282)  (4.3%)
Other interest    2,876    1,251    1,625    129.9%    6,719     5,575     1,144    20.5%
    Total         180,470  181,282  (812)    (0.4%)    718,284   741,622   (23,338) (3.1%)
interest income
Interest Expense
Interest on       9,091    14,954   (5,863)  (39.2%)   41,431    65,748    (24,317) (37.0%)
deposits 
Interest on
Federal funds
purchased and     558      1,278    (720)    (56.3%)   2,687     6,196     (3,509)  (56.6%)
securities sold
under agreements
to repurchase
Interest on
other short-term  226      879      (653)    (74.3%)   3,294     6,215     (2,921)  (47.0%)
funding
Interest on
long-term         9,140    12,346   (3,206)  (26.0%)   44,880    50,632    (5,752)  (11.4%)
funding
    Total         19,015   29,457   (10,442) (35.4%)   92,292    128,791   (36,499) (28.3%)
interest expense
Net Interest      161,455  151,825  9,630    6.3%      625,992   612,831   13,161   2.1%
Income
Provision for     3,000    1,000    2,000    200.0%    3,000     52,000    (49,000) (94.2%)
loan losses
Net interest
income after      158,455  150,825  7,630    5.1%      622,992   560,831   62,161   11.1%
provision for
loan losses
Noninterest
Income
Trust service     10,429   9,511    918      9.7%      40,737    39,145    1,592    4.1%
fees
Service charges
on deposit        16,817   17,783   (966)    (5.4%)    68,917    75,908    (6,991)  (9.2%)
accounts
Card-based and
other nondeposit  12,690   11,269   1,421    12.6%     47,862    57,905    (10,043) (17.3%)
fees
Insurance         10,862   11,216   (354)    (3.2%)    47,014    45,554    1,460    3.2%
commissions
Brokerage and
annuity           3,678    3,665    13       0.4%      15,643    17,230    (1,587)  (9.2%)
commissions
  Total core
fee-based         54,476   53,444   1,032    1.9%      220,173   235,742   (15,569) (6.6%)
revenue
Mortgage          13,530   9,677    3,853    39.8%     63,500    12,723    50,777   399.1%
banking, net
Capital market    4,243    3,950    293      7.4%      14,241    8,711     5,530    63.5%
fees, net
Bank owned life   3,206    3,820    (614)    (16.1%)   13,952    14,896    (944)    (6.3%)
insurance income
Asset losses,     (209)    (1,799)  1,590    (88.4%)   (12,096)  (12,199)  103      (0.8%)
net
Investment
securities gains  152      (310)    462      (149.0%)  4,261     (1,112)   5,373    483.2%
(losses), net
Other             2,507    2,750    (243)    (8.8%)    9,259     14,358    (5,099)  (35.5%)
    Total
noninterest       77,905   71,532   6,373    8.9%      313,290   273,119   40,171   14.7%
income
Noninterest
Expense
Personnel         98,073   90,306   7,767    8.6%      381,404   360,144   21,260   5.9%
expense
Occupancy         17,273   13,796   3,477    25.2%     60,794    55,939    4,855    8.7%
Equipment         6,444    5,286    1,158    21.9%     23,566    19,873    3,693    18.6%
Data processing   11,706   9,080    2,626    28.9%     43,548    32,475    11,073   34.1%
Business
development and   5,395    6,904    (1,509)  (21.9%)   21,303    23,038    (1,735)  (7.5%)
advertising
Other intangible  1,049    1,179    (130)    (11.0%)   4,195     4,714     (519)    (11.0%)
amortization
Loan expense      3,130    3,469    (339)    (9.8%)    12,285    12,008    277      2.3%
Legal and
professional      8,174    4,651    3,523    75.7%     31,232    18,205    13,027   71.6%
fees
Losses other      3,071    11,890   (8,819)  (74.2%)   12,258    17,921    (5,663)  (31.6%)
than loans
Foreclosure/OREO  3,293    5,169    (1,876)  (36.3%)   15,069    21,393    (6,324)  (29.6%)
expense
FDIC expense      4,813    6,136    (1,323)  (21.6%)   19,478    28,484    (9,006)  (31.6%)
Other             13,907   14,461   (554)    (3.8%)    56,691    56,329    362      0.6%
    Total
noninterest       176,328  172,327  4,001    2.3%      681,823   650,523   31,300   4.8%
expense
Income before     60,032   50,030   10,002   20.0%     254,459   183,427   71,032   38.7%
income taxes
Income tax        13,404   8,905    4,499    50.5%     75,486    43,728    31,758   72.6%
expense 
Net income        46,628   41,125   5,503    13.4%     178,973   139,699   $        28.1%
                                                                            39,274
Preferred stock
dividends and     1,300    1,300    -        0.0%      5,200     24,830    (19,630) (79.1%)
discount
Net income        $        $        $                  $         $         $      
available to               39,825    5,503   13.8%      173,773   114,869   58,904  51.3%
common equity     45,328
Earnings Per
Common Share:
                  $        $        $                  $         $         $      
  Basic                              0.03    13.0%                                  51.5%
                  0.26     0.23                         1.00      0.66      0.34
                  $        $        $                  $         $         $      
  Diluted                            0.03    13.0%                                  51.5%
                  0.26     0.23                         1.00      0.66      0.34
Average Common
Shares
Outstanding:
  Basic           170,707  173,523  (2,816)  (1.6%)    172,255   173,370   (1,115)  (0.6%)
  Diluted         170,896  173,523  (2,627)  (1.5%)    172,357   173,372   (1,015)  (0.6%)
N/M = Not
meaningful.

 

Consolidated Statements of Income (Unaudited) -
Quarterly Trend
Associated
Banc-Corp
                                      Sequential Qtr                                 Comparable Qtr
(in thousands,                        $       %
except per share  4Q12      3Q12      Change  Change   2Q12      1Q12      4Q11      $ Change % Change
amounts)
Interest Income
Interest and      $         $         $       0.3%     $         $         $         $        0.2%
fees on loans      150,107   149,647    460             147,188   149,023   149,832    275
Interest and
dividends on
investment
securities:
  Taxable         20,368    20,548    (180)   (0.9%)   23,000    23,029    22,855    (2,487)  (10.9%)
  Tax-exempt      7,119     7,127     (8)     (0.1%)   7,135     7,274     7,344     (225)    (3.1%)
Other interest    2,876     1,334     1,542   115.6%   1,262     1,247     1,251     1,625    129.9%
    Total         180,470   178,656   1,814   1.0%     178,585   180,573   181,282   (812)    (0.4%)
interest income
Interest Expense
Interest on       9,091     9,751     (660)   (6.8%)   10,553    12,036    14,954    (5,863)  (39.2%)
deposits 
Interest on
Federal funds
purchased and     558       750       (192)   (25.6%)  612       767       1,278     (720)    (56.3%)
securities sold
under agreements
to repurchase
Interest on
other short-term  226       815       (589)   (72.3%)  1,197     1,056     879       (653)    (74.3%)
funding
Interest on
long-term         9,140     11,738    (2,598) (22.1%)  11,956    12,046    12,346    (3,206)  (26.0%)
funding
    Total         19,015    23,054    (4,039) (17.5%)  24,318    25,905    29,457    (10,442) (35.4%)
interest expense
Net Interest      161,455   155,602   5,853   3.8%     154,267   154,668   151,825   9,630    6.3%
Income
Provision for     3,000     -         3,000            -         -         1,000     2,000    200.0%
loan losses
Net interest
income after      158,455   155,602   2,853   1.8%     154,267   154,668   150,825   7,630    5.1%
provision for
loan losses
Noninterest
Income
Trust service     10,429    10,396    33      0.3%     10,125    9,787     9,511     918      9.7%
fees
Service charges
on deposit        16,817    17,290    (473)   (2.7%)   16,768    18,042    17,783    (966)    (5.4%)
accounts
Card-based and
other nondeposit  12,690    12,209    481     3.9%     12,084    10,879    11,269    1,421    12.6%
fees
Insurance         10,862    11,650    (788)   (6.8%)   12,912    11,590    11,216    (354)    (3.2%)
commissions
Brokerage and
annuity           3,678     3,632     46      1.3%     4,206     4,127     3,665     13       0.4%
commissions
  Total core
fee-based         54,476    55,177    (701)   (1.3%)   56,095    54,425    53,444    1,032    1.9%
revenue
Mortgage          13,530    15,581    (2,051) (13.2%)  16,735    17,654    9,677     3,853    39.8%
banking, net
Capital market    4,243     3,609     634     17.6%    2,673     3,716     3,950     293      7.4%
fees, net
Bank owned life   3,206     3,290     (84)    (2.6%)   3,164     4,292     3,820     (614)    (16.1%)
insurance income
Asset losses,     (209)     (3,309)   3,100   (93.7%)  (4,984)   (3,594)   (1,799)   1,590    (88.4%)
net
Investment
securities gains  152       3,506     (3,354) (95.7%)  563       40        (310)     462      (149.0%)
(losses), net
Other             2,507     3,134     (627)   (20.0%)  1,705     1,913     2,750     (243)    (8.8%)
    Total
noninterest       77,905    80,988    (3,083) (3.8%)   75,951    78,446    71,532    6,373    8.9%
income
Noninterest
Expense
Personnel         98,073    95,231    2,842   3.0%     93,819    94,281    90,306    7,767    8.6%
expense
Occupancy         17,273    14,334    2,939   20.5%    14,008    15,179    13,796    3,477    25.2%
Equipment         6,444     5,935     509     8.6%     5,719     5,468     5,286     1,158    21.9%
Data processing   11,706    11,022    684     6.2%     11,304    9,516     9,080     2,626    28.9%
Business
development and   5,395     5,059     336     6.6%     5,468     5,381     6,904     (1,509)  (21.9%)
advertising
Other intangible  1,049     1,048     1       0.1%     1,049     1,049     1,179     (130)    (11.0%)
amortization
Loan expense      3,130     3,297     (167)   (5.1%)   2,948     2,910     3,469     (339)    (9.8%)
Legal and
professional      8,174     7,686     488     6.3%     5,657     9,715     4,651     3,523    75.7%
fees
Losses other      3,071     3,577     (506)   (14.1%)  2,060     3,550     11,890    (8,819)  (74.2%)
than loans
Foreclosure/OREO  3,293     4,071     (778)   (19.1%)  4,343     3,362     5,169     (1,876)  (36.3%)
expense
FDIC expense      4,813     5,017     (204)   (4.1%)   4,778     4,870     6,136     (1,323)  (21.6%)
Other             13,907    13,426    481     3.6%     14,877    14,481    14,461    (554)    (3.8%)
    Total
noninterest       176,328   169,703   6,625   3.9%     166,030   169,762   172,327   4,001    2.3%
expense
Income before     60,032    66,887    (6,855) (10.2%)  64,188    63,352    50,030    10,002   20.0%
income taxes
Income tax        13,404    20,492    (7,088) (34.6%)  20,871    20,719    8,905     4,499    50.5%
expense 
Net income        46,628    46,395    233     0.5%     43,317    42,633    41,125    5,503    13.4%
Preferred stock
dividends and     1,300     1,300     -       0.0%     1,300     1,300     1,300     -        0.0%
discount
Net income        $         $         $                $         $         $         $    
available to       45,328    45,095     233   0.5%      42,017    41,333    39,825    5,503   13.8%
common equity
Earnings Per
Common Share:
                  $         $         $                $         $         $         $      
  Basic                                    -  0.0%                                    0.03    13.0%
                   0.26      0.26                       0.24      0.24      0.23
                  $         $         $                $         $         $         $      
  Diluted                                  -  0.0%                                    0.03    13.0%
                   0.26      0.26                       0.24      0.24      0.23
Average Common
Shares
Outstanding:
  Basic           170,707   171,650   (943)   (0.5%)   172,839   173,846   173,523   (2,816)  (1.6%)
  Diluted         170,896   171,780   (884)   (0.5%)   172,841   173,848   173,523   (2,627)  (1.5%)
N/M = Not
meaningful.

Selected Quarterly Information
Associated Banc-Corp
(in thousands,
except per
share, full time                           4th Qtr      3rd Qtr      2nd Qtr      1st Qtr      4th Qtr
equivalent       YTD 2012     YTD 2011     2012         2012         2012         2012         2011
employee data
and otherwise
noted)
Summary of
Operations
Net interest     $            $            $            $            $            $            $          
income           625,992      612,831      161,455      155,602      154,267      154,668      151,825
Provision for    3,000        52,000       3,000        -            -            -            1,000
loan losses
Asset losses,    (12,096)     (12,199)     (209)        (3,309)      (4,984)      (3,594)      (1,799)
net
Investment
securities gains 4,261        (1,112)      152          3,506        563          40           (310)
(losses), net
Noninterest
income
(excluding       321,125      286,430      77,962       80,791       80,372       82,000       73,641
securities &
asset gains)
Noninterest      681,823      650,523      176,328      169,703      166,030      169,762      172,327
expense
Income before    254,459      183,427      60,032       66,887       64,188       63,352       50,030
income taxes
Income tax       75,486       43,728       13,404       20,492       20,871       20,719       8,905
expense
Net income       178,973      139,699      46,628       46,395       43,317       42,633       41,125
Net income
available to     173,773      114,869      45,328       45,095       42,017       41,333       39,825
common equity
Taxable
equivalent       21,046       21,374       5,221        5,268        5,254        5,303        5,307
adjustment
Per Common Share
Data 
Net income:
  Basic          $            $            $            $            $            $            $          
                       1.00         0.66         0.26         0.26         0.24         0.24         0.23
  Diluted        1.00         0.66         0.26         0.26         0.24         0.24         0.23
Dividends        0.23         0.04         0.08         0.05         0.05         0.05         0.01
Market Value:
  High           $            $            $            $            $            $            $          
                     14.63        15.36        13.54        13.79        13.97        14.63        11.78
  Low            11.43        8.95         12.19        12.04        11.76        11.43        9.15
  Close          13.12        11.17        13.12        13.16        13.19        13.96        11.17
Book value       16.97        16.15        16.97        16.82        16.59        16.32        16.15
Tier 1 common    11.08        10.28        11.08        10.89        10.66        10.46        10.28
equity / share
Tangible book    11.39        10.68        11.39        11.31        11.07        10.87        10.68
value
Performance
Ratios
(annualized)
Earning assets   3.77%        3.92%        3.70%        3.73%        3.80%        3.85%        3.81%
yield
Interest-bearing 0.62         0.85         0.51         0.62         0.65         0.70         0.78
liabilities rate
Net interest     3.30         3.26         3.32         3.26         3.30         3.31         3.21
margin
Return on        0.81         0.65         0.83         0.84         0.80         0.79         0.75
average assets
Return on
average tangible 8.96         6.45         9.15         9.32         8.87         8.85         8.57
common equity
Return on
average Tier 1   9.45         6.71         9.61         9.69         9.26         9.23         8.96
common equity
(1)
Efficiency ratio 70.42        70.66        72.08        70.22        69.21        70.16        74.67
(2)
Effective tax    29.67        23.84        22.33        30.64        32.52        32.70        17.80
rate
Dividend payout  23.00        6.06         30.77        19.23        20.83        20.83        4.35
ratio (3)
Average Balances
Assets           $            $            $            $            $            $            $    
                  21,976,357   21,588,620   22,461,886   22,016,748   21,684,600   21,659,139   21,755,870
Earning assets   19,613,777   19,442,263   20,032,432   19,659,796   19,386,046   19,371,729   19,506,627
Interest-bearing 14,905,735   15,120,824   14,840,162   14,940,697   14,922,006   14,920,413   15,095,689
liabilities
Loans (4)        14,741,785   13,278,848   15,131,102   14,916,793   14,602,602   14,310,441   14,043,585
Deposits         15,582,369   14,401,127   16,650,268   15,615,856   15,050,684   15,000,567   14,893,469
Short and
long-term        3,272,212    4,100,825    2,638,661    3,286,943    3,566,346    3,603,700    3,857,252
funding
Common
stockholders'    2,885,716    2,730,643    2,915,346    2,870,438    2,852,050    2,826,913    2,792,823
equity
Stockholders'    2,948,988    2,997,290    2,978,618    2,933,710    2,915,322    2,890,185    2,856,095
equity
Average Tier 1
common equity    1,838,424    1,713,155    1,876,686    1,850,610    1,825,441    1,801,649    1,763,522
(5)
At Period End
Assets                                     $            $            $            $            $    
                                            23,531,790   22,738,354   22,081,100   21,913,670   21,924,217
Loans                                      15,411,022   14,966,214   14,698,902   14,253,725   14,031,071
Allowance for                              297,409      315,150      332,658      356,298      378,151
loan losses
Goodwill                                   929,168      929,168      929,168      929,168      929,168
Mortgage
servicing                                  45,949       45,018       47,488       50,001       48,152
rights, net
Other intangible                           15,227       16,276       17,324       18,373       19,422
assets, net
Deposits                                   16,939,865   16,450,592   15,106,871   15,653,376   15,090,655
Loans / deposits                           90.97%       90.98%       97.30%       91.06%       92.98%
Risk weighted
assets ($ in                               16,194       15,575       15,188       14,570       14,568
millions) (6)
Tier 1 common                              1,875,534    1,869,931    1,828,529    1,819,782    1,783,515
equity (5)
Stockholders'                              12.48%       12.98%       13.18%       13.24%       13.07%
equity / assets
Tangible common
equity /                                   8.54%        8.91%        8.99%        9.01%        8.84%
tangible assets
(7)
Tangible equity
/ tangible                                 8.82%        9.20%        9.29%        9.32%        9.14%
assets (8)
Tier 1 common
equity /                                   11.58%       12.01%       12.04%       12.49%       12.24%
risk-weighted
assets (6)
Tier 1 leverage                            8.98%        9.99%        9.95%        10.03%       9.81%
ratio (6)
Tier 1
risk-based                                 11.97%       13.57%       13.64%       14.33%       14.08%
capital ratio
(6)
Total risk-based
capital ratio                              13.39%       15.00%       15.08%       15.78%       15.53%
(6)
Shares
outstanding, end                           169,304      171,657      171,611      173,923      173,575
of period
Selected trend
information
Average full
time equivalent                            4,915        4,965        4,951        5,045        5,056
employees
Trust assets
under                                      $            $            $            $            $          
management, at                                 6,454        6,163        5,934        5,983        5,616
market value ($
in millions)
Mortgage loans
originated for                             780,469      715,184      738,091      563,688      843,614
sale during
period
Mortgage
portfolio
serviced for                               7,453        7,547        7,511        7,284        7,321
others ($ in
millions)
Mortgage
servicing
rights, net /                              0.62%        0.60%        0.63%        0.69%        0.66%
Portfolio
serviced for
others

(1) Return on average Tier 1 common equity = Net income available to common
equity divided by average Tier 1 common equity.  This is a non-GAAP financial
measure.
(2) Efficiency ratio = Noninterest expense divided by sum of taxable
equivalent net interest income plus noninterest income, excluding investment
securities gains, net, and asset gains, net. This is a non-GAAP financial
measure.
(3) Ratio is based upon basic earnings per common share.
(4) Loans held for sale have been included in the average balances.
(5) Tier 1 common equity (period end and average) is Tier 1 capital excluding
qualifying perpetual preferred stock and qualifying trust preferred
securities.
(6) December 31, 2012 data is estimated.
(7) Tangible common equity to tangible assets = Common stockholders' equity
excluding goodwill and other intangible assets divided by assets excluding
goodwill and other intangible assets. This is a non-GAAP financial measure.
(8) Tangible equity to tangible assets = Stockholders' equity excluding
goodwill and other intangible assets divided by assets excluding goodwill and
other intangible assets. This is a non-GAAP financial measure.

 

Selected Asset Quality Information
Associated Banc-Corp
                                 Dec12 vs                             Dec12 vs
                                 Sep12                                Dec11
(in            Dec 31,  Sep 30,  % Change  Jun 30,  Mar 31,  Dec 31,  % Change
thousands)     2012     2012               2012     2012     2011
Allowance for
Loan Losses
Beginning      $        $                  $        $        $      
balance                          (5.3%)              378,151  399,723 (21.2%)
               315,150  332,658            356,298
Provision for  3,000    -        0.0%      -        -        1,000    200.0%
loan losses
Charge offs    (30,417) (25,030) 21.5%     (30,340) (31,259) (34,056) (10.7%)
Recoveries     9,676    7,522    28.6%     6,700    9,406    11,484   (15.7%)
Net charge     (20,741) (17,508) 18.5%     (23,640) (21,853) (22,572) (8.1%)
offs
Ending         $        $                  $        $        $      
balance                          (5.6%)              356,298  378,151 (21.4%)
               297,409  315,150            332,658
Reserve for    $        $                  $        $        $      
losses on                        10.1%                                48.3%
unfunded       21,800   19,800             18,900    15,600   14,700
commitments
Net Charge                       Dec12 vs                             Dec12 vs
Offs                             Sep12                                Dec11
               Dec 31,  Sep 30,  % Change  Jun 30,  Mar 31,  Dec 31,  % Change
               2012     2012               2012     2012     2011
Commercial     $        $                  $        $        $      
and                              (31.3%)                              N/M
industrial       2,630    3,831            14,544    3,872   231
Commercial
real estate -  2,056    (8)      N/M       1,164    415      539      N/M
owner
occupied
Lease          754      (20)     N/M       -        (1,836)  19       N/M
financing
  Commercial
and business   5,440    3,803    43.0%     15,708   2,451    789      N/M
lending
Commercial
real estate -  (232)    1,905    (112.2%)  177      7,354    2,394    (109.7%)
investor
Real estate    858      (187)    N/M       558      230      7,088    (87.9%)
construction
  Commercial
real estate    626      1,718    (63.6%)   735      7,584    9,482    (93.4%)
lending
    Total      6,066    5,521    9.9%      16,443   10,035   10,271   (40.9%)
commercial
Home equity    8,071    7,922    1.9%      5,284    8,950    8,113    (0.5%)
Installment    1,027    324      N/M       371      101      452      127.2%
    Total      9,098    8,246    10.3%     5,655    9,051    8,565    6.2%
retail
   
Residential    5,577    3,741    49.1%     1,542    2,767    3,736    49.3%
mortgage
        Total  $        $                  $        $        $      
net charge                       18.5%                                (8.1%)
offs           20,741   17,508             23,640    21,853   22,572
Net Charge
Offs to        Dec 31,  Sep 30,            Jun 30,  Mar 31,  Dec 31,
Average Loans  2012     2012               2012     2012     2011
(in basis
points) *
Commercial
and            25       37                 151      42       3
industrial
Commercial
real estate -  69       (0)                43       16       20
owner
occupied
Lease          480      (13)               -         N/M     14
financing
  Commercial
and business   40       29                 126      20       7
lending
Commercial
real estate -  (3)      27                 3        113      38
investor
Real estate    54       (12)               40       16        N/M 
construction
  Commercial
real estate    7        20                 9        96       122
lending
    Total      27       25                 79       50       53
commercial
Home equity    140      132                86       144      127
Installment    86       26                 28       7        32
    Total      131      114                76       119      110
retail
   
Residential    64       45                 19       34       46
mortgage
        Total
net charge     55       47                 65       61       64
offs
Credit                           Dec12 vs                             Dec12 vs
Quality                          Sep12                                Dec11
               Dec 31,  Sep 30,  % Change  Jun 30,  Mar 31,  Dec 31,  % Change
               2012     2012               2012     2012     2011
Nonaccrual     $        $                  $        $        $      
loans                            (9.1%)              327,085  356,772 (29.1%)
               252,868  278,172            317,872
Other real
estate owned   34,900   36,053   (3.2%)    40,029   34,425   41,571   (16.0%)
(OREO)
    Total      $        $                  $        $        $      
nonperforming                    (8.4%)              361,510  398,343 (27.8%)
assets         287,768  314,225            357,901
Loans 90 or
more days
past due and   2,289    2,334    (1.9%)    5,224    2,497    4,925    (53.5%)
still
accruing
Restructured
loans          121,087  135,791  (10.8%)   122,229  120,719  113,164  7.0%
(accruing)
Allowance for
loan losses /  1.93%    2.11%              2.26%    2.50%    2.70%
loans
Allowance for
loan losses /  117.61   113.29             104.65   108.93   105.99
nonaccrual
loans
Nonaccrual
loans / total  1.64     1.86               2.16     2.29     2.54
loans
Nonperforming
assets /       1.86     2.09               2.43     2.53     2.83
total loans
plus OREO
Nonperforming
assets /       1.22     1.38               1.62     1.65     1.82
total assets
Net charge
offs /         0.55     0.47               0.65     0.61     0.64
average loans
(annualized)
Year-to-date
net charge     0.57     0.58               0.63     0.61     1.13
offs /
average loans
Nonaccrual
loans by
type:
Commercial     $        $                  $        $        $      
and                              (6.0%)                               (30.1%)
industrial     39,182   41,694             46,111    50,641   56,075
Commercial
real estate -  24,254   27,161   (10.7%)   33,417   31,888   35,718   (32.1%)
owner
occupied
Lease          3,031    5,927    (48.9%)   8,260    9,040    10,644   (71.5%)
financing
  Commercial
and business   66,467   74,782   (11.1%)   87,788   91,569   102,437  (35.1%)
lending
Commercial
real estate -  58,687   71,522   (17.9%)   88,806   89,030   99,352   (40.9%)
investor
Real estate    27,302   31,684   (13.8%)   36,403   36,471   41,806   (34.7%)
construction
  Commercial
real estate    85,989   103,206  (16.7%)   125,209  125,501  141,158  (39.1%)
lending
    Total      152,456  177,988  (14.3%)   212,997  217,070  243,595  (37.4%)
commercial
Home equity    39,215   38,467   1.9%      41,536   44,628   46,907   (16.4%)
Installment    1,838    2,893    (36.5%)   3,047    2,627    2,715    (32.3%)
  Total        41,053   41,360   (0.7%)    44,583   47,255   49,622   (17.3%)
retail
  Residential  59,359   58,824   0.9%      60,292   62,760   63,555   (6.6%)
mortgage
    Total      100,412  100,184  0.2%      104,875  110,015  113,177  (11.3%)
consumer
        Total  $        $                  $        $        $      
nonaccrual                       (9.1%)              327,085  356,772 (29.1%)
loans          252,868  278,172            317,872
* Annualized.
N/M = Not meaningful.

Selected Asset Quality Information
(continued)
Associated Banc-Corp
                                   Dec12 vs                            Dec12
                                   Sep12                               vs
                                                                       Dec11
(in thousands)     Dec 31, Sep 30, % Change  Jun 30, Mar 31, Dec 31,   %
                   2012    2012              2012    2012    2011      Change
Restructured
loans (accruing)
Commercial and     $       $                 $       $       $        
industrial                         (19.6%)                    22,552   24.8%
                   28,140  35,015            28,399  25,622
Commercial real
estate - owner     13,852  15,706  (11.8%)   7,115   6,926   8,138     70.2%
occupied
Lease financing    -       -       0.0%      -       -       -         0.0%
  Commercial and   41,992  50,721  (17.2%)   35,514  32,548  30,690    36.8%
business lending
Commercial real    41,660  49,249  (15.4%)   49,325  45,845  43,417    (4.0%)
estate - investor
Real estate        4,530   3,561   27.2%     5,838   11,770  10,977    (58.7%)
construction
  Commercial real  46,190  52,810  (12.5%)   55,163  57,615  54,394    (15.1%)
estate lending
    Total          88,182  103,531 (14.8%)   90,677  90,163  85,084    3.6%
commercial
Home equity        9,968   9,467   5.3%      9,471   9,092   8,950     11.4%
Installment        653     672     (2.8%)    779     999     1,015     (35.7%)
  Total retail     10,621  10,139  4.8%      10,250  10,091  9,965     6.6%
  Residential      22,284  22,121  0.7%      21,302  20,465  18,115    23.0%
mortgage
    Total          32,905  32,260  2.0%      31,552  30,556  28,080    17.2%
consumer
        Total      $       $                 $       $       $      
restructured                       (10.8%)                    113,164  7.0%
loans (accruing)   121,087 135,791           122,229 120,719
Restructured
loans in           $       $                 $       $       $        
nonaccrual loans                   8.5%                       87,493   (7.9%)
(not included      80,590  74,251            86,395  79,946
above)
Loans Past Due                     Dec12 vs                            Dec12
30-89 Days                         Sep12                               vs
                                                                       Dec11
                   Dec 31, Sep 30, % Change  Jun 30, Mar 31, Dec 31,   %
                   2012    2012              2012    2012    2011      Change
Commercial and     $       $                 $       $       $        
industrial                         N/M                          8,743  29.7%
                   11,339    3,795             4,465 12,643
Commercial real
estate - owner     11,053  4,843   128.2%    2,125   7,532   7,092     55.9%
occupied
Lease financing    12      17      (29.4%)   39      40      104       (88.5%)
  Commercial and   22,404  8,655   158.9%    6,629   20,215  15,939    40.6%
business lending
Commercial real    13,472  8,809   52.9%     12,854  8,313   4,970     171.1%
estate - investor
Real estate        3,155   1,254   151.6%    1,618   1,736   996       216.8%
construction
  Commercial real  16,627  10,063  65.2%     14,472  10,049  5,966     178.7%
estate lending
    Total          39,031  18,718  108.5%    21,101  30,264  21,905    78.2%
commercial
Home equity        13,538  14,823  (8.7%)    15,302  18,007  12,189    11.1%
Installment        2,109   1,693   24.6%     1,558   2,813   2,592     (18.6%)
  Total retail     15,647  16,516  (5.3%)    16,860  20,820  14,781    5.9%
  Residential      9,403   6,878   36.7%     9,836   10,114  7,224     30.2%
mortgage
    Total          25,050  23,394  7.1%      26,696  30,934  22,005    13.8%
consumer
        Total      $       $                 $       $       $        
loans past due                     52.2%                      43,910   45.9%
30-89 days         64,081  42,112            47,797  61,198
Potential Problem                  Dec12 vs                            Dec12
Loans                              Sep12                               vs
                                                                       Dec11
                   Dec 31, Sep 30, % Change  Jun 30, Mar 31, Dec 31,   %
                   2012    2012              2012    2012    2011      Change
Commercial and     $       $                 $       $       $      
industrial                         6.2%                       153,306  (16.2%)
                   128,434 120,888           121,764 157,778
Commercial real
estate - owner     99,592  120,034 (17.0%)   108,508 112,673 136,366   (27.0%)
occupied
Lease financing    264     214     23.4%     324     487     158       67.1%
  Commercial and   228,290 241,136 (5.3%)    230,596 270,938 289,830   (21.2%)
business lending
Commercial real    107,068 133,046 (19.5%)   142,453 167,339 230,206   (53.5%)
estate - investor
Real estate        13,092  18,477  (29.1%)   23,905  27,654  27,649    (52.6%)
construction
  Commercial real  120,160 151,523 (20.7%)   166,358 194,993 257,855   (53.4%)
estate lending
    Total          348,450 392,659 (11.3%)   396,954 465,931 547,685   (36.4%)
commercial
Home equity        3,670   3,343   9.8%      4,173   4,441   5,451     (32.7%)
Installment        111     131     (15.3%)   127     142     233       (52.4%)
  Total retail     3,781   3,474   8.8%      4,300   4,583   5,684     (33.5%)
  Residential      8,762   8,197   6.9%      8,658   9,580   13,037    (32.8%)
mortgage
    Total          12,543  11,671  7.5%      12,958  14,163  18,721    (33.0%)
consumer
        Total      $       $                 $       $       $      
potential problem                  (10.7%)                    566,406  (36.3%)
loans              360,993 404,330           409,912 480,094

 

Net Interest Income Analysis -
Taxable Equivalent Basis
Associated           Year ended December 31, 2012  Year ended December 31, 2011
Banc-Corp
                      Average    Interest Average   Average    Interest Average
                                  Income   Yield                Income   Yield
(in thousands)        Balance    /        / Rate    Balance    /        / Rate 
                                 Expense                       Expense 
Earning assets:
   Loans: (1) (2)
(3)
      Commercial     $           $                 $           $      
and business          5,139,155           3.94%     4,301,377           4.24%
lending                          202,444                        182,362
      Commercial     3,350,190   140,881  4.21     2,973,351   132,789  4.47
real estate lending
         Total                                     $           $      
commercial           8,489,345   343,325  4.04      7,274,728           4.33
                                                                315,151
      Residential    3,330,123   121,399  3.65     2,819,702   116,207  4.12
mortgage
      Retail         2,922,317   135,094  4.62     3,184,418   154,793  4.86
         Total       14,741,785  599,818  4.07     13,278,848  586,151  4.41
loans
      Investment     4,469,541   132,793  2.97     5,497,297   171,270  3.12
securities
      Other
short-term           402,451     6,719    1.67     666,118     5,575    0.84
investments
        
Investments and      4,871,992   139,512  2.86     6,163,415   176,845  2.87
other
Total earning        19,613,777  739,330  3.77     19,442,263  762,996  3.92
assets
   Other assets,     2,362,580                     2,146,357
net
Total assets         $                             $    
                      21,976,357                    21,588,620
Interest-bearing
liabilities:
                     $           $                 $           $      
   Savings deposits   1,096,692           0.08%    987,198              0.11%
                                      851                         1,091
   Interest-bearing  2,148,459   3,741    0.17     1,947,506   3,429    0.18
demand deposits
   Money market      6,148,663   15,336   0.25     5,147,437   16,385   0.32
deposits
   Time deposits     2,239,709   21,503   0.96     2,937,858   44,843   1.53
      Total
interest-bearing     11,633,523  41,431   0.36     11,019,999  65,748   0.60
deposits
   Federal funds
purchased and
securities sold
under                1,177,105   2,687    0.23     1,926,474   6,196    0.32

agreements to
repurchase
   Other short-term  936,376     3,294    0.35     767,230     6,215    0.81
funding
   Total long-term   1,158,731   44,880   3.87     1,407,121   50,632   3.60
funding
      Total short
and long-term        3,272,212   50,861   1.55     4,100,825   63,043   1.54
funding
Total
interest-bearing     14,905,735  92,292   0.62     15,120,824  128,791  0.85
liabilities
  
Noninterest-bearing  3,948,846                     3,381,128
demand deposits
   Other             172,788                       89,378
liabilities
   Stockholders'     2,948,988                     2,997,290
equity
Total liabilities    $                             $    
and stockholders'     21,976,357                    21,588,620
equity
Net interest income              $                             $      
and rate spread (1)                       3.15%                         3.07%
                                 647,038                        634,205
Net interest margin                       3.30%                         3.26%
(1)
Taxable equivalent               $                             $      
adjustment                                                            
                                 21,046                         21,374
Net Interest Income Analysis -
Taxable Equivalent Basis
Associated           Three months ended December   Three months ended December
Banc-Corp            31, 2012                      31, 2011
                      Average    Interest Average   Average    Interest Average
                                  Income   Yield                Income   Yield
(in thousands)        Balance    /        / Rate    Balance    /        / Rate 
                                 Expense                       Expense 
Earning assets:
   Loans: (1) (2)
(3)
      Commercial     $           $                 $           $      
and business          5,431,195           3.92%     4,638,160           4.13%
lending                          53,442                         48,243
      Commercial     3,451,104   35,623   4.11     3,090,643   34,181   4.39
real estate lending
         Total                                     $           $      
commercial           8,882,299   89,065   3.99      7,728,803           4.23
                                                                82,424
      Residential    3,485,719   30,126   3.46     3,216,466   31,643   3.93
mortgage
      Retail         2,763,084   31,865   4.59     3,098,316   36,666   4.71
         Total       15,131,102  151,056  3.98     14,043,585  150,733  4.27
loans
      Investment     4,545,178   31,759   2.79     5,020,429   34,605   2.76
securities
      Other
short-term           356,152     2,876    3.22     442,613     1,251    1.13
investments
        
Investments and      4,901,330   34,635   2.83     5,463,042   35,856   2.63
other
Total earning        20,032,432  185,691  3.70     19,506,627  186,589  3.81
assets
   Other assets,     2,429,454                     2,249,243
net
Total assets         $                             $    
                      22,461,886                    21,755,870
Interest-bearing
liabilities:
                                 $                             $      
   Savings deposits  $                    0.08%    $                    0.09%
                      1,129,983       225           1,017,271       
                                                               230
   Interest-bearing  2,236,826   954      0.17     2,152,518   1,115    0.21
demand deposits
   Money market      6,797,306   4,103    0.24     5,308,174   3,649    0.27
deposits
   Time deposits     2,037,386   3,809    0.74     2,760,474   9,960    1.43
      Total
interest-bearing     12,201,501  9,091    0.30     11,238,437  14,954   0.53
deposits
   Federal funds
purchased and
securities sold      984,869     558      0.23     1,824,999   1,278    0.28
under agreements to
repurchase
   Other short-term  550,137     226      0.16     691,960     879      0.50
funding
   Total long-term   1,103,655   9,140    3.31     1,340,293   12,346   3.68
funding
      Total short
and long-term        2,638,661   9,924    1.50     3,857,252   14,503   1.50
funding
Total
interest-bearing     14,840,162  19,015   0.51     15,095,689  29,457   0.78
liabilities
  
Noninterest-bearing  4,448,767                     3,655,032
demand deposits
   Other             194,339                       149,054
liabilities
   Stockholders'     2,978,618                     2,856,095
equity
Total liabilities    $                             $    
and stockholders'     22,461,886                    21,755,870
equity
Net interest income              $                             $      
and rate spread (1)                       3.19%                         3.03%
                                 166,676                        157,132
Net interest margin                       3.32%                         3.21%
(1)
Taxable equivalent               $                             $      
adjustment                                                            
                                   5,221                          5,307

(1) The yield on tax exempt loans and securities is computed on a taxable
equivalent basis using a tax rate of 35% for all periods presented and is net
of the effects of certain disallowed interest deductions.
(2) Nonaccrual loans and loans held for sale have been included in the average
balances.
(3) Interest income includes net loan fees.

 

Net Interest Income Analysis - Taxable
Equivalent Basis
Associated           Three months ended December 31,  Three months ended September 30,
Banc-Corp            2012                             2012
                      Average    Interest    Average   Average    Interest   Average
(in thousands)        Balance     Income /    Yield    Balance     Income /   Yield /
                                 Expense     / Rate               Expense    Rate 
Earning assets:
   Loans: (1) (2)
(3)
      Commercial     $           $                    $           $        
and business          5,431,195      53,442  3.92%     5,275,069             3.88%
lending                                                            51,432
      Commercial     3,451,104   35,623      4.11     3,440,220   35,913     4.16
real estate lending
         Total                                        $           $        
commercial           8,882,299   89,065      3.99      8,715,289             3.99
                                                                   87,345
      Residential    3,485,719   30,126      3.46     3,320,212   30,044     3.62
mortgage
      Retail         2,763,084   31,865      4.59     2,881,292   33,251     4.60
         Total       15,131,102  151,056     3.98     14,916,793  150,640    4.02
loans
      Investment     4,545,178   31,759      2.79     4,319,404   31,950     2.96
securities
      Other
short-term           356,152     2,876       3.22     423,599     1,334      1.26
investments
        
Investments and      4,901,330   34,635      2.83     4,743,003   33,284     2.81
other
Total earning        20,032,432  185,691     3.70     19,659,796  183,924    3.73
assets
   Other assets,     2,429,454                        2,356,952
net
Total assets         $                                $    
                      22,461,886                       22,016,748
Interest-bearing
liabilities:
                     $           $                    $           $        
   Savings deposits   1,129,983              0.08%     1,117,194             0.08%
                                  225                               229
   Interest-bearing  2,236,826   954         0.17     2,136,280   926        0.17
demand deposits
   Money market      6,797,306   4,103       0.24     6,240,596   3,932      0.25
deposits
   Time deposits     2,037,386   3,809       0.74     2,159,684   4,664      0.86
      Total
interest-bearing     12,201,501  9,091       0.30     11,653,754  9,751      0.33
deposits
   Federal funds
purchased and
securities sold      984,869     558         0.23     1,266,995   750        0.24
under agreements to
repurchase
   Other short-term  550,137     226         0.16     837,316     815        0.39
funding
   Total long-term   1,103,655   9,140       3.31     1,182,632   11,738     3.97
funding
      Total short
and long-term        2,638,661   9,924       1.50     3,286,943   13,303     1.62
funding
Total
interest-bearing     14,840,162  19,015      0.51     14,940,697  23,054     0.62
liabilities
  
Noninterest-bearing  4,448,767                        3,962,102
demand deposits
   Other             194,339                          180,239
liabilities
   Stockholders'     2,978,618                        2,933,710
equity
Total liabilities    $                                $    
and stockholders'     22,461,886                       22,016,748
equity
Net interest income              $                                $        
and rate spread (1)                166,676   3.19%                           3.11%
                                                                   160,870
Net interest margin                          3.32%                           3.26%
(1)
Taxable equivalent               $                                $        
adjustment                             5,221                             
                                                                   5,268
(1) The yield on tax exempt loans and securities is computed on a taxable equivalent
basis using a tax rate of 35% for all periods presented and is net of the effects of
certain disallowed interest deductions.
(2) Nonaccrual loans and loans held for sale have been included in the average balances.
(3) Interest income includes net loan fees.
Financial Summary and Comparison
Associated Banc-Corp
Period End Loan                              Dec12                                      Dec12
Composition                                  vs                                         vs
                                             Sep12                                      Dec11
                     Dec 31,     Sep 30,     %        Jun 30,     Mar 31,    Dec 31,    %
                     2012        2012        Change   2012        2012       2011       Change
Commercial and       $           $                    $           $          $  
industrial            4,502,021   4,265,356  5.5%      4,076,370             3,724,736  20.9%
                                                                  3,719,016
Commercial real
estate - owner       1,219,747   1,197,517   1.9%     1,116,815   1,074,755  1,086,829  12.2%
occupied
Lease financing      64,196      60,818      5.6%     62,750      61,208     58,194     10.3%
    Commercial and   5,785,964   5,523,691   4.7%     5,255,935   4,854,979  4,869,759  18.8%
business lending
Commercial real      2,906,759   2,787,158   4.3%     2,810,521   2,664,251  2,563,767  13.4%
estate - investor
Real estate          655,381     611,186     7.2%     612,556     565,953    584,046    12.2%
construction
    Commercial real  3,562,140   3,398,344   4.8%     3,423,077   3,230,204  3,147,813  13.2%
estate lending
        Total        9,348,104   8,922,035   4.8%     8,679,012   8,085,183  8,017,572  16.6%
commercial
Home equity          2,219,494   2,356,900   (5.8%)   2,429,594   2,501,770  2,504,704  (11.4%)
Installment          466,727     482,451     (3.3%)   510,831     537,628    557,782    (16.3%)
    Total retail     2,686,221   2,839,351   (5.4%)   2,940,425   3,039,398  3,062,486  (12.3%)
    Residential      3,376,697   3,204,828   5.4%     3,079,465   3,129,144  2,951,013  14.4%
mortgage
        Total        6,062,918   6,044,179   0.3%     6,019,890   6,168,542  6,013,499  0.8%
consumer
        Total loans  $           $           3.0%     $           $          $          9.8%
                      15,411,022  14,966,214           14,698,902 14,253,725 14,031,071
Period End Deposit                           Dec12                                      Dec12
and Customer                                 vs                                         vs
Funding Composition                          Sep12                                      Dec11
                     Dec 31,     Sep 30,     %        Jun 30,     Mar 31,    Dec 31,    %
                     2012        2012        Change   2012        2012       2011       Change
Noninterest-bearing  $           $                    $           $          $  
demand                4,759,556   4,320,437  10.2%     3,874,429             3,928,792  21.1%
                                                                  3,989,156
Savings              1,109,861   1,115,783   (0.5%)   1,117,593   1,098,975  986,766    12.5%
Interest-bearing     2,554,479   2,230,740   14.5%    2,078,037   2,040,900  2,297,454  11.2%
demand
Money market         6,518,075   6,682,640   (2.5%)   5,822,449   6,176,981  5,150,275  26.6%
Brokered CDs         26,270      33,612      (21.8%)  41,104      46,493     202,948    (87.1%)
Other time           1,971,624   2,067,380   (4.6%)   2,173,259   2,300,871  2,524,420  (21.9%)
  Total deposits     16,939,865  16,450,592  3.0%     15,106,871  15,653,376 15,090,655 12.3%
Customer repo        564,038     600,225     (6.0%)   592,203     635,697    664,624    (15.1%)
sweeps
Customer repo term   115,032     448,782     (74.4%)  619,897     509,332    695,131    (83.5%)
  Total customer     679,070     1,049,007   (35.3%)  1,212,100   1,145,029  1,359,755  (50.1%)
funding
    Total deposits   $           $                    $           $          $
and customer          17,618,935  17,499,599 0.7%      16,318,971 16,798,405 16,450,410 7.1%
funding
Network transaction
deposits included
above in             1,684,745   1,740,434   (3.2%)   1,234,010   1,171,679  875,052    92.5%
interest-bearing
demand and money
market
Brokered CDs         26,270      33,612      (21.8%)  41,104      46,493     202,948    (87.1%)
    Total network
and brokered         1,711,015   1,774,046   (3.6%)   1,275,114   1,218,172  1,078,000  58.7%
funding
    Net customer
deposits and         15,907,920  15,725,553  1.2%     15,043,857  15,580,233 15,372,410 3.5%
funding (4)
(4) Total deposits and customer funding excluding total network and brokered funding.

SOURCE Associated Banc-Corp

Website: http://www.associatedbank.com
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