Array

Array

Array


This report contains statements that may constitute forward-looking statements
within the meaning of the safe-harbor provisions for forward-looking statements
contained in the Private Securities Litigation Reform Act of 1995, such as
statements other than historical facts contained or incorporated by reference
into this report. These forward-looking statements include statements with
respect to the Corporation's financial condition, results of operations, plans,
objectives, future performance and business, including statements preceded by,
followed by or that include the words "believes," "expects," or "anticipates,"
references to estimates or similar expressions. Future filings by the
Corporation with the SEC, and future statements other than historical facts
contained in written material, press releases and oral statements issued by, or
on behalf of the Corporation may also constitute forward-looking statements.

All forward-looking statements contained in this report or which may be
contained in future statements made for or on behalf of the Corporation are
based upon information available at the time the statement is made and the
Corporation assumes no obligation to update any forward-looking statements,
except as required by federal securities law. Forward-looking statements are
subject to significant risks and uncertainties, and the Corporation's actual
results may differ materially from the expected results discussed in such
forward-looking statements. Factors that might cause actual results to differ
from the results discussed in forward-looking statements include, but are not
limited to, the risk factors in Item 1A, Risk Factors, in the Corporation's
Annual Report on Form 10-K for the year ended December 31, 2021, in Item 1A of
Part 2 herein, and as may be described from time to time in the Corporation's
subsequent SEC filings.

Overview

The following discussion and analysis is presented to assist in the
understanding and evaluation of the Corporation's financial condition and
results of operations. It is intended to complement the unaudited consolidated
financial statements, footnotes, and supplemental financial data appearing
elsewhere in this Quarterly Report on Form 10-Q and should be read in
conjunction therewith. Management continually evaluates strategic acquisition
opportunities and various other strategic alternatives that could involve the
sale or acquisition of branches or other assets, or the consolidation or
creation of subsidiaries. Within the tables presented, certain columns and rows
may not sum due to the use of rounded numbers for disclosure purposes.

Array


•Average loans of $24.1 billion decreased $366 million, or 1%, compared to the
first three months of 2021. For 2022, the Corporation expects auto finance loan
growth of more than $1.2 billion and commercial loan growth, including
asset-based lending and equipment finance, of $750 million to $1.0 billion.

Array Array Array ArrayArray


•Net interest income of $188 million increased $12 million, or 7%, from the
first three months of 2021, and net interest margin was 2.42% compared to 2.39%
for the first three months of 2021. The increase in net interest income was
driven by higher investment income and lower interest-bearing liability costs,
partially offset by lower commercial PPP lending income. For 2022, the
Corporation expects net interest income of more than $840 million, assuming a 25
bp increase at each FOMC meeting this year.

•Provision for credit losses had a release of $4 million, compared to a release
of $23 million for the first three months of 2021. For 2022, the Corporation
expects to adjust the provision to reflect changes to risk grades, economic
conditions, loan volumes, and other indications of credit quality.

•Noninterest income of $74 million decreased $21 million, or 22%, from the first
three months of 2021, primarily driven by the $16 million, or 65%, decrease in
mortgage banking, net, driven by decreased gains on sold loans due to lower
mortgage settlements and a reduction of $5 million due to changes in MSRs
valuation, net of economic hedges. For 2022, the Corporation expects noninterest
income of $290 million to $300 million.

•Noninterest expense of $173 million decreased $2 million, or 1%, from the first
three months of 2021. For 2022, the Corporation expects noninterest expense will
be approximately $725 million to $740 million.

                                       50

Array

Array

Array

                                                                                 Three months ended
($ in Thousands, except per share data)                      Mar 31, 2022   

Array Array Array Array
Array

                                                  $     74,262    

Array Array Array Array
Array

                             71,387    

Array

                                   0.48            0.49            0.56            0.56            0.58
Earnings per common share - diluted                                 0.47            0.49            0.56            0.56            0.58
Effective tax rate                                                 20.07  %        16.48  %        20.61  %        19.81  %        20.69  %


                                       51

Array

Array

Array

                                                                                                            Three Months Ended
                                                                   Mar 31, 2022                                Dec 31, 2021                                Mar 31, 2021
                                                                      Interest      Average                       Interest      Average                       Interest      Average
                                                        Average       

Array

 ($ in Thousands)                                       Balance       Expense         Rate          Balance       Expense         Rate          Balance       Expense         Rate
Assets
Earning assets
Loans(a)(b)(c)
Commercial PPP lending                              $     43,774    $   

Array Array Array Array Array Array

           4.47  %

Array

           2.90  %      125,507          971           3.07  %      137,862        1,072           3.15  %

Array

                                     8,815,676       52,754           2.43  %    8,715,796       53,401           2.43  %    8,399,439       53,019           2.56  %
Commercial real estate lending                         6,177,062       43,886           2.88  %    6,134,049       45,040           2.91  %    6,171,202       44,315           2.91  %
Total commercial                                      15,239,348       99,366           2.64  %   15,090,427      104,468           2.75  %   15,515,202      107,307           2.80  %
Residential mortgage                                   7,671,329       55,403           2.89  %    7,751,337       54,952           2.84  %    7,962,691       55,504           2.79  %
Auto finance                                             305,202        2,649           3.52  %       53,120          587           4.39  %       10,190          111           4.43  %
Other retail                                             881,859       10,662           4.87  %      900,369       11,188           4.95  %      975,266       11,519           4.75  %
Total loans                                           24,097,738      168,081           2.81  %   23,795,253      171,195           2.86  %   24,463,349      174,442           2.88  %
Investment securities
Taxable                                                4,363,733       16,472           1.51  %    4,067,612       13,317           1.31  %    2,976,469        7,014           0.94  %
Tax-exempt(a)                                          2,384,601       20,296           3.40  %    2,257,106       19,617           3.48  %    1,900,346       17,844           3.76  %
Other short-term investments                           1,154,939        1,993           0.70  %    1,592,840        2,031           0.51  %      991,844        1,694           0.69  %
Investments and other                                  7,903,273       38,761           1.96  %    7,917,558       34,965           1.76  %    5,868,659       26,553           1.81  %
Total earning assets                                  32,001,010    $ 206,842           2.60  %   31,712,810    $ 206,160           2.59  %   30,332,008    $ 200,994           2.67  %
Other assets, net                                      3,199,172                                   3,303,349                                   3,352,135
Total assets                                        $ 35,200,182                                $ 35,016,159                                $ 

Array

Liabilities and Stockholders' equity
Interest-bearing liabilities
Interest-bearing deposits
Savings                                             $  4,529,991    $     380           0.03  % $  4,367,233    $     369           0.03  % $  3,810,321    $     332           0.04  %
Interest-bearing demand                                6,722,038        1,025           0.06  %    6,506,438        1,015           0.06  %    5,713,270        1,178           0.08  %
Money market                                           7,030,945          965           0.06  %    6,892,803          927           0.05  %    6,875,730        1,059           0.06  %
Network transaction deposits                             734,895          265           0.15  %      838,255          239           0.11  %    1,080,109          327           0.12  %
Time deposits                                          1,313,101          937           0.29  %    1,381,092        1,127           0.32  %    1,658,568        3,014           0.74  %
Total interest-bearing deposits                       20,330,970        3,571           0.07  %   19,985,821        3,677           0.07  %   19,137,998        5,909           0.13  %
Federal funds purchased and securities sold under
agreements to repurchase                                 293,915           38           0.05  %      293,948           40           0.05  %      136,144           26           0.08  %
Commercial paper                                          27,963            1           0.01  %       44,250            2           0.01  %       42,774            6           0.05  %

FHLB advances                                          1,610,983        8,182           2.06  %    1,621,097        8,514           2.08  %    1,631,895        9,493           2.36  %
Long-term funding                                        249,632        2,730           4.38  %      249,223        2,730           4.38  %      549,585        5,585           4.07  %
Total short and long-term funding                      2,182,492       10,951           2.03  %    2,208,518       11,286           2.03  %    2,360,397       15,109           2.58  %
Total interest-bearing liabilities                    22,513,462    $  14,522           0.26  %   22,194,339    $  14,963           0.27  %   21,498,395    $  21,018           0.40  %
Noninterest-bearing demand deposits                    8,316,399                                   8,416,525                                   7,666,561
Other liabilities                                        383,528                                     401,433                                     415,195
Stockholders' Equity                                   3,986,792                                   4,003,863                                   

Array

Total liabilities and stockholders' equity          $ 35,200,182                                $ 35,016,159                                $ 33,684,143
Interest rate spread                                                                    2.34  %                                     2.32  %                                     2.27  %
Net free funds                                                                          0.08  %                                     0.08  %                                     0.12  %
Fully tax-equivalent net interest income and net
interest margin ("NIM")                                             $ 192,320           2.42  %                 $ 191,197           2.40  %                 $ 179,976           2.39  %
Fully tax-equivalent adjustment                                         4,573                                       4,434                                       4,074
Net interest income                                                 $ 187,747                                   $ 186,763                                   $ 175,902



(a) The yield on tax-exempt loans and securities is computed on a fully
tax-equivalent basis using a tax rate of 21% and is net of the effects of
certain disallowed interest deductions.
(b) Nonaccrual loans and loans held for sale have been included in the average
balances.
(c) Interest income includes amortization of net deferred loan origination costs
and net accreted purchase loan discount.
(d) Periods prior to the first quarter of 2022 do not include equipment finance.




                                       52
--------------------------------------------------------------------------------
  Table of     Contents
Notable Contributions to the Change in Net Interest Income

•Net interest income and fully tax-equivalent net interest income was $12
million, or 7%, higher than the first three months of 2021. Average investments
and other short-term investments increased $2.0 billion, or 35%. The increase in
net interest income was driven by higher investment income and lower
interest-bearing liability costs, partially offset by lower commercial PPP
lending income. See sections Interest Rate Risk and Quantitative and Qualitative
Disclosures about Market Risk for a discussion of interest rate risk and market
risk.

•  Average interest-bearing liabilities were up $1.0 billion, or 5%, compared to
the first three months of 2021. Interest-bearing deposits increased $1.2
billion, or 6%, primarily driven by an increase in low cost deposits partially
offset by decreases in higher cost deposits. Average noninterest-bearing demand
deposits were up $650 million, or 8%, versus the first three months of 2021.

•  The cost of interest-bearing liabilities decreased 14 bp from the first three
months of 2021, primarily attributable to a favorable mix with lower cost core
deposit balances increasing and higher cost deposits and long-term funding
decreasing.

•The Federal Reserve raised the federal funds target interest to a range of
0.25% to 0.50% in March 2022, which was the first change since the first quarter
of 2020.

Provision for Credit Losses

The provision for credit losses is predominantly a function of the Corporation's
reserving methodology and judgments as to other qualitative and quantitative
factors used to determine the appropriate level of the ACLL, which focuses on
changes in the size and character of the loan portfolio, changes in levels of
individually evaluated and other nonaccrual loans, historical losses and
delinquencies in each portfolio category, the risk inherent in specific loans,
concentrations of loans to specific borrowers or industries, existing economic
conditions and economic forecasts, the fair value of underlying collateral, and
other factors which could affect potential credit losses. The forecast the
Corporation used for March 31, 2022 was the Moody's baseline forecast from
February 2022 over a 2 year reasonable and supportable period with straight-line
reversion to historical losses over the second year of the period. See
additional discussion under the sections titled, Loans, Credit Risk,
Nonperforming Assets, and Allowance for Credit Losses on Loans.

                                       53
--------------------------------------------------------------------------------
  Table of     Contents
Noninterest Income

Table 3 Noninterest Income
                                                                            Three months ended                                    Changes vs
($ in Thousands, except as noted)                      Mar 31, 2022     Dec 

Array Array Array Array Array Array
Array

                            $      22,404    $      22,625    $      22,110    $      22,706    $      22,414           (1) %          -  %
Service charges and deposit account fees                    16,856           17,039           16,962           15,549           14,855           (1) %         13  %
Card-based fees                                              9,926           11,176           11,113           10,982            9,743          (11) %          2  %
Other fee-based revenue                                      3,766            4,316            3,929            4,244            4,596          (13) %        (18) %
Total fee-based revenue                                     52,952           55,157           54,113           53,480           51,608           (4) %          3  %
Capital markets, net                                         8,646            9,674            7,114            5,696            8,118          (11) %          7  %
Mortgage servicing fees, net(b)                              1,830              795              323             (155)          (1,397)         130  % 

Array

Gains and fair value adjustments on loans
held for sale                                                  785            3,290            8,341            8,623           14,744          (76) %  

Array


Changes in mortgage servicing rights
valuation, net of economic hedge(c)                          5,776            3,955            1,993             (340)          10,578           46  %        (45) %
Mortgage banking, net                                        8,391            8,041           10,657            8,128           23,925            4  %        (65) %
Bank and corporate owned life insurance                      2,071            4,704            2,760            3,088            2,702          (56) %        (23) %

Other                                                        2,198            2,941            2,205            3,004            3,216          (25) %        (32) %
Subtotal                                                    74,258           80,517           76,848           73,397           89,570           (8) %        (17) %
Asset gains (losses), net                                      188              985            5,228              (14)           4,809          (81) %        (96) %
Investment securities gains(losses), net                        21                -                -               24              (39)            N/M 

Array

Gain on the sale of branches, net(d)                             -                -                -               36            1,002             N/M       (100) %
Total noninterest income                             $      74,467    $      81,502    $      82,076    $      73,443    $      95,343           (9) %        (22) %
Mortgage loans originated for sale during
period                                               $     252,113    $     

Array Array Array Array Array

       (39) %
Mortgage loan settlements during period                    296,089          

Array

Array


Assets under management, at market value(e)                 12,937           13,679           13,148           13,141           12,553           (5) %          3  %


N/M = Not Meaningful
(a) Includes trust, asset management, brokerage, and annuity fees.
(b) Includes mortgage origination and servicing fees, net of MSRs
amortization/decay.
(c) On January 1, 2022, the Corporation made the irrevocable election to account
for MSRs at fair value. For all prior periods, MSRs were carried at LOCOM.
(d) Includes the deposit premium on the sale of branches net of miscellaneous
costs to sell. See Note 2 Acquisitions and Dispositions for additional details
on the branch sales.
(e) $ in millions. Excludes assets held in brokerage accounts.

Array


•Mortgage banking, net decreased $16 million from the first three months of
2021, driven by decreased gains on sold loans due to lower mortgage settlements
and a reduction of $5 million due to changes in MSRs valuation, net of economic
hedges.

•Asset gains (losses), net decreased $5 million from the first three months of
2021, due to a gain of $2 million from the sale of Whitnell and higher gains
from private equity investments during the first three months of 2021.

Array Array Array

                                       54
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  Table of     Contents
Noninterest Expense

Array

                                                                           Three months ended                                     Change vs
($ in Thousands)                                      Mar 31, 2022     Dec 31, 2021     Sep 30, 2021     Jun 30, 2021     Mar 31, 2021   Dec 31, 2021 Mar 31, 2021
Personnel                                           $     104,811    $     107,787    $     107,880    $     106,994    $     104,026           (3) %         1  %
Technology                                                 21,485           20,787           19,927           20,236           20,740            3  %         4  %
Occupancy                                                  16,080           16,863           15,814           14,679           16,156           (5) %         -  %
Business development and advertising                        4,954            5,627            6,156            4,970            4,395          (12) %        13  %
Equipment                                                   4,960            4,905            5,200            5,481            5,518            1  %       (10) %
Legal and professional                                      5,087            4,428            4,304            6,661            6,530           15  %       (22) %
Loan and foreclosure costs                                  2,014            1,636            1,616            2,671            2,220           23  %        (9) %
FDIC assessment                                             5,100            4,800            5,000            3,600            4,750            6  %         7  %
Other intangible amortization                               2,203            2,203            2,203            2,203            2,236            -  %        (1) %

Other                                                       6,597           13,173            9,793            6,979            8,775          (50) %       (25) %
Total noninterest expense                           $     173,292    $     182,210    $     177,892    $     174,475    $     175,347           (5) %        (1) %
Average FTEs(a)                                             4,018            3,992            4,010            3,990            4,020            1  %         -  %


N/M = Not Meaningful
(a) Average FTEs without overtime

Array


•Legal and professional expenses decreased $1 million from the first three
months of 2021 as a result of lower consulting costs associated with mortgage
activity.

Array Array Array

Array


The Corporation recognized income tax expense of $19 million for the three
months ended March 31, 2022, compared to income tax expense of $25 million for
the three months ended March 31, 2021. The Corporation's effective tax rate was
20.07% for the first three months of 2022, compared to an effective tax rate of
20.69% for the first three months of 2021. The decrease in income tax expense
during the first three months of 2022 was primarily driven by a decrease in
income before tax. The decrease in the effective tax rate was primarily driven
by an increase in tax-exempt interest income. The Corporation expects a full
year effective tax rate of 19% to 21%, assuming no change in the statutory
corporate tax rate.

Income tax expense recorded on the consolidated statements of income involves
the interpretation and application of certain accounting pronouncements and
federal and state tax laws and regulations. The Corporation is subject to
examination by various taxing authorities. Examination by taxing authorities may
impact the amount of tax expense and/or the reserve for uncertainty in income
taxes if their interpretations differ from those of management, based on their
judgments about information available to them at the time of their examinations.
                                       55
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  Table of     Contents
Balance Sheet Analysis

Array ArrayArray ArrayArray Array Array
Array Array ArrayArray ArrayArray


•Interest bearing deposits in other financial institutions were $167 million at
March 31, 2022, down $515 million, or 76%, from December 31, 2021 and down $1.4
billion, or 90%, from March 31, 2021, due to the deployment of excess liquidity
into investment securities purchases and loan growth.

•Investment securities AFS, at fair value were $2.8 billion at March 31, 2022,
down $1.6 billion, or 36%, from December 31, 2021, and down $576 million, or
17%, from March 31, 2021. Investment securities HTM, net, at amortized cost were
$3.9 billion at March 31, 2022, up $1.7 billion, or 76%, from December 31, 2021
and up $2.1 billion, or 112%, from March 31, 2021, driven by the deployment of
cash into higher yielding assets and a $1.6 billion transfer of investment
securities AFS, at fair value, to investment securities HTM, net, at amortized
cost during the first quarter of 2022. See Note 6 Investment Securities for
additional details.

•Loans of $24.5 billion at March 31, 2022 were up $307 million, or 1%, from
December 31, 2021 and up $370 million, or 2%, from March 31, 2021. See Note 7
Loans for additional details.

•At March 31, 2022, total deposits of $28.4 billion were down $61 million from
December 31, 2021 and were up $728 million, or 3%, from March 31, 2021.
Government stimulus programs and changed savings habits have led to customers
holding higher deposit balances. See section Deposits and Customer Funding for
additional information on deposits.

•Other long-term funding was $250 million at March 31, 2022 and $249 million at
December 31, 2021 and was down $300 million, or 55%, from March 31, 2021,
primarily driven by the redemption of the Bank's senior notes on July 13, 2021.
See Note 9 Short and Long-Term Funding for additional details.

•Preferred equity was $193 million at March 31, 2022 and December 31, 2021 and
was down $160 million, or 45%, from March 31, 2021, as a result of the
redemption of the Corporation's Series C Preferred Stock during the second
quarter of 2021 and the redemption of the Corporation's Series D Preferred Stock
during the third quarter of 2021.

Array

Array

                                                  Mar 31, 2022               Dec 31, 2021               Sep 30, 2021               Jun 30, 2021               Mar 31, 2021
                                                              % of                       % of                       % of                       % of                       % of
 ($ in Thousands)                              Amount        Total        Amount        Total        Amount        Total        Amount        Total        Amount        Total
PPP                                        $     17,995          -  % $    

Array Array Array Array Array Array Array

      137,537          1  %
Commercial and industrial                     8,102,380         33  %    

Array

      883,237          4  %
Commercial and business lending               9,324,986         38  %    

Array

             4,469,241         18  %    4,384,569         18  %    4,296,489         18  %    4,300,651         18  %    4,260,706         18  %
Real estate construction                      1,760,076          7  %   

Array

                6,229,317         25  %    6,193,545         26  %    6,131,360         26  %    6,181,549         26  %    6,143,004         25  %
Total commercial                             15,554,303         63  %   15,617,256         64  %   15,120,493         64  %   15,376,904         64  %   15,527,307         64  %
Residential mortgage                          7,609,343         31  %    7,567,310         31  %    7,590,895         32  %    7,638,372         32  %    7,685,218         32  %
Auto finance                                    497,523          2  %      143,045          1  %        6,739          -  %        7,817          -  %        9,165          -  %

Home equity                                     580,867          2  %      595,615          2  %      608,566          3  %      631,783          3  %      651,647          3  %
Other consumer                                  289,889          1  %      301,723          1  %      294,979          1  %      292,660          1  %      288,990          1  %
Total consumer                                8,977,622         37  %    8,607,693         36  %    8,501,180         36  %    8,570,632         36  %    8,635,020         36  %
Total loans                                $ 24,531,926        100  % $ 24,224,949        100  % $ 23,621,673        100  % $ 23,947,536        100  % $ 24,162,328        100  %

Array


The Corporation has long-term guidelines relative to the proportion of
Commercial and Business, CRE, and Consumer loan commitments within the overall
loan portfolio, with each targeted to represent 30 to 40% of the overall loan
portfolio. The targeted long-term guidelines were unchanged during 2021 and the
first three months of 2022. Furthermore, certain sub-asset classes within the
respective portfolios are further defined and dollar limitations are placed on
these sub-portfolios. These guidelines and limits are reviewed quarterly and
approved annually by the Enterprise Risk Committee of the Corporation's Board of
Directors. These guidelines and limits are designed to create balance and
diversification within the loan portfolios.

                                       56

Array

Array
Array Array
Array Array

Array

                      Within 1 Year(a)     1-5 Years      5-15 Years     Over 15 Years        Total           % of Total
PPP                                 $           1,640    $    16,355    $         -    $            -    $     17,995                    -  %
Asset-based lending & equipment
finance                                       176,817         40,122         14,101                 -         231,040                    1  %
Commercial and industrial                   7,579,861        419,869         84,386            18,264       8,102,380                   33  %
Commercial real estate - owner
occupied                                      548,348        301,720        122,925               578         973,572                    4  %
Commercial real estate - investor           4,040,023        277,790        151,149               280       4,469,241                   18  %
Real estate construction                    1,704,706         45,061          3,143             7,166       1,760,076                    7  %
Commercial - adjustable                     8,321,120        147,966         12,970             6,769       8,488,825                   35  %
Commercial - fixed                          5,730,275        952,951        362,734            19,519       7,065,479                   29  %
Residential mortgage - adjustable             367,114        594,375      1,454,319               271       2,416,079                   10  %
Residential mortgage - fixed                   29,390         97,088        601,445         4,465,341       5,193,263                   21  %
Auto finance                                      294         93,605        403,624                 -         497,523                    2  %
Home equity                                    22,315         67,747         97,668           393,137         580,867                    2  %
Other consumer                                 53,423         47,647        156,294            32,526         289,889                    1  %
Total loans                         $      14,523,931    $ 2,001,378    $ 3,089,053    $    4,917,562    $ 24,531,926                  100  %
Fixed-rate                          $       5,760,092    $ 1,125,296    $   750,299    $    4,888,686    $ 12,524,372                   51  %
Floating or adjustable rate                 8,763,840        876,083      2,338,755            28,877      12,007,554                   49  %
Total                               $      14,523,931    $ 2,001,378    $ 3,089,053    $    4,917,562    $ 24,531,926                  100  %

Array

Array ArrayArray ArrayArray Array Array

Array


An active credit risk management process is used for commercial loans to ensure
that sound and consistent credit decisions are made. Credit risk is controlled
by detailed underwriting procedures, comprehensive loan administration, and
periodic review of borrowers' outstanding loans and commitments. Borrower
relationships are formally reviewed and graded on an ongoing basis for early
identification of potential problems. Further analysis by customer, industry,
and geographic location are performed to monitor trends, financial performance,
and concentrations. See Note 7 Loans of the notes to consolidated financial
statements for additional information on managing overall credit quality.

The loan portfolio is widely diversified by types of borrowers, industry groups,
and market areas within the Corporation's branch footprint. Significant loan
concentrations are considered to exist when there are amounts loaned to numerous
borrowers engaged in similar activities that would cause them to be similarly
impacted by economic or other conditions. At March 31, 2022, no significant
concentrations existed in the Corporation's portfolio in excess of 10% of total
loan exposure.

Array


Table 7 Largest Commercial and Industrial Industry Group Exposures, by NAICS
Subsector
                                                                        Outstanding                        % of Total Loan
March 31, 2022                                     NAICS Subsector        Balance       Total Exposure        Exposure
Credit Intermediation and Related Activities(a)                   522 $  1,130,942    $     2,773,669                   8  %
Real Estate(b)                                                    531    1,510,493          2,735,180                   8  %
Utilities(c)                                                      221    1,827,305          2,019,958                   6  %


(a) Includes mortgage warehouse lines
(b) Includes REIT lines
(c) 60% of the total exposure supports wind and solar projects

Array

Array

                                       57
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The credit risk related to commercial loans is largely influenced by general
economic conditions and the resulting impact on a borrower's operations or on
the value of underlying collateral, if any.

Array

Array

Array

                                                                                     Estate - Investor Loan
March 31, 2022                                        % of Total Loan Exposure              Exposure
Multi-Family                                                                4  %                          29  %
Office                                                                      3  %                          24  %
Industrial                                                                  3  %                          23  %

Array


Credit risk is managed in a similar manner to commercial and business lending by
employing sound underwriting guidelines, lending primarily to borrowers in local
markets and businesses, periodically evaluating the underlying collateral, and
formally reviewing the borrower's financial soundness and relationship on an
ongoing basis.

Real estate construction: Real estate construction loans are primarily
short-term or interim loans that provide financing for the acquisition or
development of commercial income properties, multi-family projects, or
residential development, both single family and condominium. Real estate
construction loans are made to developers and project managers who are generally
well known to the Corporation and have prior successful project experience. The
credit risk associated with real estate construction loans is generally confined
to specific geographic areas but is also influenced by general economic
conditions. The Corporation controls the credit risk on these types of loans by
making loans in familiar markets to developers, reviewing the merits of
individual projects, controlling loan structure, and monitoring project progress
and construction advances.

Array

                                                                                      % of Total Real Estate
March 31, 2022                                        % of Total Loan Exposure      Construction Loan Exposure
Multi-Family                                                                4  %                            34  %
Single Family                                                               3  %                            24  %
Industrial                                                                  3  %                            23  %

Array


The Corporation's current lending standards for CRE and real estate construction
lending are determined by property type and specifically address many criteria,
including: maximum loan amounts, maximum LTV, requirements for pre-leasing and /
or presales, minimum borrower equity, and maximum loan-to-cost. Currently, the
maximum standard for LTV is 80%, with lower limits established for certain
higher risk types, such as raw land that has a 50% LTV maximum. The
Corporation's LTV guidelines are in compliance with regulatory supervisory
limits. In most cases, for real estate construction loans, the loan amounts
include interest reserves, which are built into the loans and sized to fund loan
payments through construction and lease up and / or sell out.

Residential mortgages: Residential mortgage loans are primarily first lien home
mortgages with a maximum loan-to-collateral value without credit enhancement
(e.g. private mortgage insurance) of 80%. The residential mortgage portfolio is
focused primarily in the Corporation's three-state branch footprint, with
approximately 87% of the outstanding loan balances in the Corporation's branch
footprint at March 31, 2022. The majority of the on balance sheet residential
mortgage portfolio consists of constant maturity treasury based, hybrid,
adjustable rate mortgage loans with initial fixed rate terms of 3, 5, 7, or 10
years. The rates on these mortgages adjust based upon the movement in the
underlying index which is then added to a margin and rounded to the nearest
0.125%. That result is then subjected to any periodic caps to produce the
borrower's interest rate for the coming term.

The Corporation generally retains certain fixed-rate residential real estate
mortgages in its loan portfolio, including retail and private banking jumbo
mortgages and CRA-related mortgages. As part of management's historical practice
of originating and servicing residential mortgage loans, generally the
Corporation's 30 year, agency conforming, fixed-rate residential real estate
mortgage loans have been sold in the secondary market with servicing rights
retained. Subject to management's analysis of the

                                       58
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current interest rate environment, among other market factors, the Corporation
may choose to retain mortgage loan production on its balance sheet. See section
Loans for additional information on loans.

Array Array Array


Home equity: Home equity consists of both home equity lines of credit and
closed-end home equity loans. The Corporation's credit risk monitoring
guidelines for home equity are based on an ongoing review of loan delinquency
status, as well as a quarterly review of FICO score deterioration and property
devaluation. The Corporation does not routinely obtain appraisals on performing
loans to update LTV ratios after origination; however, the Corporation monitors
the local housing markets by reviewing the various home price indices and
incorporates the impact of the changing market conditions in its ongoing credit
monitoring process. For junior lien home equity loans, the Corporation is unable
to track the performance of the first lien loan if it does not own or service
the first lien loan. However, the Corporation obtains a refreshed FICO score on
a quarterly basis and monitors this as part of its assessment of the home equity
portfolio.

The Corporation's underwriting and risk-based pricing guidelines for home equity
lines of credit and loans consist of a combination of both borrower FICO score
and the original cumulative LTV against the property securing the
loan. Currently, the Corporation's policy sets the maximum acceptable LTV at 90%
and the minimum acceptable FICO score at 670. The Corporation's current home
equity line of credit offering is priced based on floating rate indices and
generally allows 10 years of interest-only payments followed by a 20-year
amortization of the outstanding balance. The loans in the Corporation's
portfolio generally have an original term of 20 years with principal and
interest payments required. See section Loans for additional information on
loans.

Indirect Auto: The Corporation currently purchases retail auto sales contracts
via a network of approved auto dealerships across 13 states throughout the
Northeast, Mid-Atlantic and Midwestern United States. The auto dealerships
finance the sale of automobiles as the initial lender and then assign the
contracts to the Corporation pursuant to dealer agreements. The Corporation's
underwriting and pricing guidelines are based on a dual risk grade derived from
a combination of FICO auto score and proprietary internal custom score. Minimum
grade and FICO score standards ensure the credit risk is appropriately managed
to the Corporation's risk appetite. Further, the grade influences loan-specific
parameters such as vehicle age, term, LTV, loan amount, mileage, payment and
debt service thresholds, and pricing. Maximum loan terms offered are 84 months
on select grades with vehicle age, mileage, and other limitations in place to
qualify. The program is designed to capture primarily prime and super prime
contracts. Over time, the Corporation expects roughly 60% of originations to be
secured by used vehicles.

Other consumer: Other consumer consists of student loans, short-term personal
installment loans, and credit cards. The Corporation had $96 million and $101
million of student loans at March 31, 2022 and December 31, 2021, respectively,
the majority of which are government guaranteed. Currently, there is federal
student loan relief in effect through August 31, 2022. Credit risk for
non-government guaranteed student loans, short-term personal installment loans,
and credit cards is influenced by general economic conditions, the
characteristics of individual borrowers, and the nature of the loan collateral.
Risks of loss are generally on smaller average balances per loan spread over
many borrowers. Once charged off, there is usually less opportunity for recovery
of these smaller consumer loans. Credit risk is primarily controlled by
reviewing the creditworthiness of the borrowers, monitoring payment histories,
and taking appropriate collateral and guarantee positions. The student loan
portfolio is in run-off and no new student loans are being originated.

                                       59

Array

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Array


Management is committed to a proactive nonaccrual and problem loan
identification philosophy. This philosophy is implemented through the ongoing
monitoring and review of all pools of risk in the loan portfolio to ensure that
problem loans are identified quickly and the risk of loss is minimized. Table 10
provides detailed information regarding NPAs, which include nonaccrual loans,
OREO, and other NPAs:

Array

                                            Mar 31,      Dec 31,      Sep 30,      Jun 30,      Mar 31,
 ($ in Thousands)                             2022         2021         2021         2021         2021
Nonperforming assets
PPP                                       $      41    $      46    $       -    $       -    $       -

Commercial and industrial                       225        6,233        8,497       18,380       33,192
Commercial real estate - owner occupied           -            -            7            7            7
Commercial and business lending                 266        6,279        8,504       18,387       33,200
Commercial real estate - investor            80,886       60,677       61,504       63,003       58,485
Real estate construction                        609          177          247          247          327
Commercial real estate lending               81,495       60,855       61,751       63,250       58,813
Total commercial                             81,761       67,134       70,256       81,637       92,012
Residential mortgage                         53,827       55,362       56,678       56,795       61,256
Auto finance                                     49           52           67           56           36
Home equity                                   7,490        7,726        7,838        8,517        9,792
Other consumer                                   95          170          222          131          195
Total consumer                               61,460       63,309       64,806       65,498       71,280
Total nonaccrual loans                      143,221      130,443      135,062      147,135      163,292
Commercial real estate owned                    861          984        1,005        1,318        2,092
Residential real estate owned                 2,209        3,666        2,126        2,438        1,501
Bank properties real estate owned(a)         15,123       24,969       30,724       20,244       20,995
OREO                                         18,194       29,619       

Array


Total nonperforming assets                $ 161,414    $ 160,062    $ 

Array Array Array


Accruing loans past due 90 days or more
Commercial                                $     125    $     151    $      98    $     203    $     190
Consumer                                      1,470        1,111          932        1,099        1,485
Total accruing loans past due 90 days or
more                                      $   1,595    $   1,263    $   1,029    $   1,302    $   1,675
Restructured loans (accruing)
Commercial                                $  10,127    $  22,763    $  25,582    $  26,353    $  27,356
Consumer                                     19,876       19,768       18,917       15,582       13,464
Total restructured loans (accruing)       $  30,003    $  42,530    $  44,499    $  41,935    $  40,820
Nonaccrual restructured loans (included
in nonaccrual loans)                      $  19,352    $  17,426    $  15,226    $  17,237    $  17,624
Ratios
Nonaccrual loans to total loans                0.58  %      0.54  %      0.57  %      0.61  %      0.68  %
NPAs to total loans plus OREO                  0.66  %      0.66  %      0.71  %      0.71  %      0.78  %
NPAs to total assets                           0.46  %      0.46  %      

Array


Allowance for credit losses on loans to
nonaccrual loans                             221.92  %    245.16  %    246.02  %    247.45  %    247.23  %


                                       60

Array

Array

Array

                                           Mar 31,      Dec 31,      Sep 

Array ArrayArray ArrayArray

 ($ in Thousands)                            2022         2021         2021         2021         2021
Accruing loans 30-89 days past due
PPP                                      $       1    $      83    $     568    $       -    $       -

Commercial and industrial                    1,085          632       

Array

           47            -
Commercial and business lending              1,284          878        1,827          306          526
Commercial real estate - investor                -          616       17,021          391        5,999
Real estate construction                         -        1,620            -          117          977
Commercial real estate lending                   -        2,236       17,021          509        6,976
Total commercial                             1,284        3,114       18,848          814        7,502
Residential mortgage                         4,957        6,169        7,095        5,015        3,973
Auto finance                                   949           11           10           38           24

Home equity                                  4,207        3,711        2,931        2,472        2,352
Other consumer                               1,232        2,307        1,272        1,036        1,246
Total consumer                              11,345       12,198      

Array Array Array Array Array Array


Potential problem loans
PPP(b)                                   $      54    $   2,000    $   4,160    $   8,695    $  22,398
Asset-based lending & equipment
finance(c)                                  19,057       17,697            -            -            -
Commercial and industrial                   93,396      120,561      124,990       77,064      122,143
Commercial real estate - owner occupied     24,005       26,723       21,241       17,828       15,965
Commercial and business lending            136,513      166,981      150,391      103,587      160,506
Commercial real estate - investor          130,792      106,138       78,962       71,613       85,752
Real estate construction                       200       21,408       19,187       16,465       13,977
Commercial real estate lending             130,992      127,546       98,150       88,078       99,728
Total commercial                           267,505      294,527      248,541      191,665      260,234
Residential mortgage                         3,032        2,214        2,374        3,024        2,524

Home equity                                    156          165          171        1,558        1,729

Total consumer                               3,188        2,379        2,546        4,583        4,254
Total potential problem loans            $ 270,693    $ 296,905    $ 

Array Array Array



(a) Primarily closed branches and other bank operated real estate facilities,
pending disposition.
(b) The Corporation's policy is to assign risk ratings at the borrower level.
PPP loans are 100% guaranteed by the SBA and therefore the Corporation considers
these loans to have a

Array

Array


Accruing loans past due 90 days or more: Loans past due 90 days or more but
still accruing interest are classified as such where the underlying loans are
both well secured (the collateral value is sufficient to cover principal and
accrued interest) and are in the process of collection.

Restructured loans: Loans are considered restructured loans if concessions have
been granted to borrowers that are experiencing financial difficulty. See also
Note 7 Loans of the notes to consolidated financial statements for additional
restructured loans disclosures.

Potential problem loans: The level of potential problem loans is another
predominant factor in determining the relative level of risk in the loan
portfolio and in determining the appropriate level of the ACLL. Potential
problem loans are generally defined by management to include loans rated as
substandard by management that are collectively evaluated (not nonaccrual loans
or accruing TDRs); however, there are circumstances present to create doubt as
to the ability of the borrower to comply with present repayment terms. The
decision of management to include performing loans in potential problem loans
does not necessarily mean that the Corporation expects losses to occur, but that
management recognizes a higher degree of risk associated with these loans.

Array

                                       61

Array

Array

Array


Credit risks within the loan portfolio are inherently different for each loan
type. Credit risk is controlled and monitored through the use of lending
standards, a thorough review of potential borrowers, and ongoing review of loan
payment performance. Active asset quality administration, including early
problem loan identification and timely resolution of problems, aids in the
management of credit risk and the minimization of loan losses. Credit risk
management for each loan type is discussed in the section entitled Credit Risk.
See Note 7 Loans of the notes to consolidated financial statements for
additional disclosures on the ACLL.

To assess the appropriateness of the ACLL, the Corporation focuses on the
evaluation of many factors, including but not limited to: evaluation of facts
and issues related to specific loans, management's ongoing review and grading of
the loan portfolio, credit report refreshes, consideration of historical loan
loss and delinquency experience on each portfolio category, trends in past due
and nonaccrual loans, the level of potential problem loans, the risk
characteristics of the various classifications of loan segments, changes in the
size and character of the loan portfolio, concentrations of loans to specific
borrowers or industries, existing economic conditions and economic forecasts,
the fair value of underlying collateral, funding assumptions on lines, and other
qualitative and quantitative factors which could affect potential credit losses.
The Corporation utilized the Moody's baseline forecast for February 2022 in the
allowance model. The forecast is applied over a 2 year reasonable and
supportable period with straight-line reversion to historical losses over the
second year of the period. Assessing these factors involves significant
judgment. Because each of the criteria used is subject to change, the ACLL is
not necessarily indicative of the trend of future credit losses on loans in any
particular segment. Therefore, management considers the ACLL a critical
accounting estimate, see section Critical Accounting Estimates for additional
information on the ACLL. See section Nonperforming Assets for a detailed
discussion on asset quality. See also Note 7 Loans of the notes to consolidated
financial statements for additional ACLL disclosures. Table 5 provides
information on loan growth and period end loan composition, Table 10 provides
additional information regarding NPAs, and Table 11 and Table 12 provide
additional information regarding activity in the ACLL.

The loan segmentation used in calculating the ACLL at March 31, 2022 and
December 31, 2021 was generally comparable. The methodology to calculate the
ACLL consists of the following components: a valuation allowance estimate is
established for commercial and consumer loans determined by the Corporation to
be individually evaluated, using discounted cash flows, estimated fair value of
underlying collateral, and/or other data available. Loans are segmented for
criticized loan pools by loan type as well as for non-criticized loan pools by
loan type, primarily based on historical loss rates after considering loan type,
historical loss and delinquency experience, credit quality, and industry
classifications. Loans that have been criticized are considered to have a higher
risk of default than non-criticized loans, as circumstances were present to
support the lower loan grade, warranting higher loss factors. The loss factors
applied in the methodology are periodically re-evaluated and adjusted to reflect
changes in historical loss levels or other risks. Additionally, management
allocates ACLL to absorb losses that may not be provided for by the other
components due to qualitative factors evaluated by management, such as
limitations within the credit risk grading process, known current economic or
business conditions that may not yet show in trends, industry or other
concentrations with current issues that impose higher inherent risks than are
reflected in the loss factors, and other relevant considerations. The total
allowance is available to absorb losses from any segment of the loan portfolio.


                                       62
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Table 11 Allowance for Credit Losses on Loans
                                                                           Quarter Ended
                                                        Mar 31,         Dec 31,         Sep 30,         Jun 30,         Mar 31,
($ in Thousands)                                         2022            2021            2021            2021            2021
Allowance for Loan Losses
Balance at beginning of period                      $    280,015    $    290,997    $    318,811    $    352,938    $    383,702

Provision for loan losses                                 (3,000)         (4,500)        (20,000)        (29,500)        (26,000)

Charge offs                                               (2,028)         (8,869)        (10,929)         (7,681)        (13,174)
Recoveries                                                 4,072           2,387           3,115           3,054           8,410
Net (charge offs) recoveries                               2,044          (6,482)         (7,814)         (4,628)         (4,764)
Balance at end of period                            $    279,058    $   

Array Array Array Array
Array

                      $     39,776    $     

Array Array Array Array


Provision for unfunded commitments                        (1,000)         

Array


Balance at end of period                            $     38,776    $     

Array Array Array Array
Array

                $    317,835    $    

Array Array Array Array
Array

                      (4,000)         

Array

Array

Array Array Array

                                  1,854          (6,669)         (9,149)          1,072           1,334
Commercial real estate - owner occupied                        3               4             106               5               4
Commercial and business lending                            1,857          (6,638)         (8,951)          1,338           1,370
Commercial real estate - investor                              -             109             181          (5,589)         (5,886)
Real estate construction                                      32              52              18              23              29
Commercial real estate lending                                32             162             199          (5,566)         (5,857)
Total commercial                                           1,889          (6,476)         (8,752)         (4,228)         (4,487)
Residential mortgage                                         288              (6)            300            (223)           (109)
Auto finance                                                   4             (11)              8               3               9

Home equity                                                  315             546             959             337             344
Other consumer                                              (451)           (534)           (329)           (517)           (521)
Total consumer                                               155              (6)            938            (400)           (277)
Total net (charge offs) recoveries                  $      2,044    $     

Array Array Array Array

Array


Allowance for credit losses on loans to total
loans                                                       1.30  %         

Array


Allowance for credit losses on loans to net
charge offs (annualized)                                        N/M           12.4x           10.7x           19.6x           20.9x
Loan Evaluation Method for ACLL
Individually evaluated for impairment               $     13,625    $     

Array Array Array Array
Array

                    304,210         

Array

   Total ACLL                                       $    317,835    $    

Array Array Array Array
Array

               $    110,445    $    

Array Array Array Array
Array

                 24,421,481      24,109,306      23,490,189      23,805,719      23,982,321
   Total loan balance                               $ 24,531,926    $ 24,224,949    $ 23,621,673    $ 23,947,536    $ 24,162,328

Array

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Table 12 Annualized Net (Charge Offs) Recoveries(a)
                                                                        Quarter Ended
                                                       Mar 31,       Dec 31,        Sep 30,         Jun 30,          Mar 31,
(In basis points)                                       2022           2021          2021            2021             2021

Array


Asset-based lending & equipment finance(b)                   -              9            36                87            10
Commercial and industrial                                   10            (34)          (47)                6             7
Commercial real estate - owner occupied                      -              -             5                 -             -
Commercial and business lending                              8            (29)          (40)                6             6
Commercial real estate - investor                            -              1             2               (52)          (55)
Real estate construction                                     1              1             -                 1             1
Commercial real estate lending                               -              1             1               (36)          (38)
Total commercial                                             5            (17)          (23)              (11)          (12)
Residential mortgage                                         2              -             2                (1)           (1)
Auto finance                                                 1             (9)           43                15            37
Home equity                                                 22             36            61                21            21
Other consumer                                             (62)           (71)          (44)              (72)          (72)
Total consumer                                               1              -             4                (2)           (1)
Total net (charge offs) recoveries                           3            (11)          (13)               (8)           (8)


Array

Array


•Potential problem loans decreased $26 million, or 9%, from December 31, 2021,
and increased $6 million, or 2%, from March 31, 2021. The decrease from
December 31, 2021 was primarily driven by commercial and industrial and real
estate construction lending, partially offset by an increase in CRE-investor
lending. The increase from March 31, 2021 was primarily driven by increases in
CRE-investor, asset-based, and CRE-owner occupied lending. These increases were
partially offset by decreases in commercial and industrial, PPP, and real estate
construction lending. See Table 10 for additional information regarding
potential problem loans.

•Total nonaccrual loans increased $13 million, or 10%, from December 31, 2021,
and decreased $20 million, or 12%, from March 31, 2021. The increase from
December 31, 2021 was primarily due to an increase in CRE-investor lending,
which was partially offset by a decrease in commercial and industrial lending.
The decrease from March 31, 2021 was primarily driven by decreases in commercial
and industrial, residential mortgage, and home equity lending. These decreases
were partially offset by an increase in CRE-investor lending. See Note 7 Loans
of the notes to consolidated financial statements and Table 10 for additional
disclosures on the changes in asset quality.

•Net charge offs (recoveries) decreased $7 million from March 31, 2021 to a
recovery position, primarily driven by no charge offs in the CRE-investor
portfolio in the current period, combined with net recoveries in the commercial
and industrial portfolio. See Table 11 and Table 12 for additional information
on the activity in the ACLL.

Array ArrayArray

                                       64

Array

Array

Array

Array

Array

                                                   Mar 31, 2022                Dec 31, 2021                Sep 30, 2021                Jun 30, 2021                Mar 31, 2021
                                                               % of                        % of                        % of                        % of                        % of
 ($ in Thousands)                               Amount         Total       

Array

                  $  8,315,699          29  % $  8,504,077          30  % $  8,170,105          29  % $  7,999,143          29  % $  8,496,194          31  %
Savings                                        4,661,232          16  %   

Array

                        6,616,767          23  %    

Array

                                   7,522,797          26  %    

Array

                                  1,288,913           5  %    1,347,262           5  %    1,410,886           5  %    1,472,395           5  %    1,561,352           6  %

  Total deposits                            $ 28,405,409         100  % $ 

Array Array Array Array Array Array Array

                              299,301                     354,142                     322,081                     226,160            

Array

Total deposits and customer funding         $ 28,704,710                $ 28,820,572                $ 28,173,348                $ 27,490,459                $ 27,859,394
Network transaction deposits(b)             $    762,680                $    766,965                $    929,174                $    871,603            

Array


Net deposits and customer funding (total
deposits and customer funding, excluding
network transaction deposits)               $ 27,942,029                $ 28,053,607                $ 27,244,174                $ 26,618,856          

Array


Time deposits of more than $250,000         $    209,208                $    215,100                $    223,075                $    232,035            

Array

Array

Array
Array Array ArrayArray ArrayArray
ArrayArray

Array ArrayArray ArrayArray ArrayArray ArrayArray


•Network deposits, primarily sourced from other financial institutions and
intermediaries, represented 3% of the Corporation's total deposits at March 31,
2022. Network deposits decreased $4 million, or 1%, from December 31, 2021, and
decreased $292 million, or 28%, from March 31, 2021.

Array


The objective of liquidity risk management is to ensure that the Corporation has
the ability to generate sufficient cash or cash equivalents in a timely and cost
effective manner to satisfy the cash flow requirements of depositors and
borrowers and to meet its other commitments as they become due. The
Corporation's liquidity risk management process is designed to identify,
measure, and manage the Corporation's funding and liquidity risk to meet its
daily funding needs in the ordinary course of business, as well as to address
expected and unexpected changes in its funding requirements. The Corporation
engages in various activities to manage its liquidity risk, including
diversifying its funding sources, stress testing, and holding readily-marketable
assets which can be used as a source of liquidity, if needed.

The Corporation performs dynamic scenario analysis in accordance with industry
best practices. Measures have been established to ensure the Corporation has
sufficient high quality short-term liquidity to meet cash flow requirements
under stressed scenarios. In addition, the Corporation also reviews static
measures such as deposit funding as a percentage of total assets and liquid
asset levels. Strong capital ratios, credit quality, and core earnings are also
essential to maintaining cost effective access to wholesale funding markets. At
March 31, 2022, the Corporation was in compliance with its internal liquidity
objectives and had sufficient asset-based liquidity to meet its obligations
under a stressed scenario.

Array

Array Array Array


•Pledgeable loan collateral, which is eligible collateral with both the Federal
Reserve Bank and the FHLB under established lines of credit. Based on the amount
of collateral pledged, the FHLB established a collateral value from which the
Bank may draw advances, and issue letters of credit in favor of public fund
depositors, against the collateral. As of March 31, 2022, the Bank had $3.9
billion available for future funding. The Federal Reserve Bank also establishes
a collateral value

                                       65
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  Table of     Contents
of assets to support borrowings from the discount window. As of March 31, 2022,
the Bank had $742 million available for discount window borrowings.

Array Array Array Array
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•Acquisition related equity issuances by the Parent Company; the Corporation has
filed a shelf registration statement with the SEC under which the Parent Company
may, from time to time, offer shares of the Corporation's common stock in
connection with acquisitions of businesses, assets, or securities of other
companies.

•Other issuances by the Parent Company; the Corporation maintains on file with
the SEC a universal shelf registration statement, under which the Parent Company
may offer the following securities, either separately or in units: debt
securities, preferred stock, depositary shares, common stock, and warrants.

Array


•Global Bank Note Program issuances; the Bank has implemented a program pursuant
to which it may from time to time offer up to $2.0 billion aggregate principal
amount of its unsecured senior and subordinated notes.

Credit ratings relate to the Corporation's ability to issue debt securities and
the cost to borrow money, and should not be viewed as an indication of future
stock performance or a recommendation to buy, sell, or hold securities. Adverse
changes in these factors could result in a negative change in credit ratings and
impact not only the ability to raise funds in the capital markets but also the
cost of these funds. The credit ratings of the Parent Company and the Bank at
March 31, 2022 are displayed below:

Array

                                             Moody's     S&P
Bank short-term deposits                           P-1        -
Bank long-term deposits/issuer                      A1     BBB+
Corporation commercial paper                       P-2        -

Array

                                       Negative   Stable


For the three months ended March 31, 2022, net cash provided by operating
activities was $246 million, while net cash used in investing and financing
activities was $640 million and $131 million, respectively, for a net decrease
in cash and cash equivalents of $524 million since year-end 2021. At March 31,
2022, assets of $35.0 billion decreased $148 million from year-end 2021. On the
funding side, deposits of $28.4 billion decreased $61 million from year-end
2021.

For the three months ended March 31, 2021, net cash provided by operating and
financing activities was $158 million and $1.1 billion, respectively, while net
cash used in investing activities was $12 million, for a net increase in cash
and cash equivalents of $1.2 billion from year-end 2020. At March 31, 2021,
assets of $34.6 billion increased $1.2 billion, or 3%, from year-end 2020,
primarily driven by a $1.3 billion increase in interest-bearing deposits in
other financial institutions, partially offset by a $289 million, or 1%,
decrease in loans. On the funding side, deposits of $27.7 billion increased $1.2
billion, or 5%, from year-end 2020 related to deposit inflows from government
stimulus programs.

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