Summary of Associated Banc-Corp Q3 2025 Earnings Call

1Key Financial Results and Metrics

Earnings Per Share (EPS): Reported at $0.73.

Net Interest Income (NII): Achieved a record $305 million, up 16% year-over-year.

Total Loans: Grew by 1% quarter-over-quarter and 3% year-over-year; adjusted for a loan sale, growth was 5.5%.

Core Deposits: Increased by $628 million (2%) from Q2 and up 4% ($1.2 billion) year-over-year.

Return on Average Tangible Common Equity (ROTCE): Improved to over 14%, a 250 basis point increase from Q3 2024.

Credit Quality: Nonaccruals at 34 basis points of total loans; net charge-offs stable at 17 basis points.

2Strategic Updates and Business Highlights

Focused on organic growth, achieving net household growth each quarter in 2025, with the strongest year for organic checking household growth since tracking began.

Significant growth in Commercial & Industrial (C&I) loans, with nearly $1 billion added year-to-date.

Continued efforts to remix the balance sheet by reducing low-yielding residential mortgages while increasing core deposits.

Investment in talent acquisition, particularly in underpenetrated metro markets, is expected to drive future growth.

3Forward Guidance and Outlook

Anticipated loan growth of 5% to 6% for the year, with a strong pipeline for C&I loans.

Expecting net interest income growth of 14% to 15% in 2025, assuming two additional Federal Reserve rate cuts.

Core customer deposit growth expected to be at the lower end of the 4% to 5% range for the year.

Confidence in maintaining a CET1 ratio within 10% to 10.5% for 2025.

4Bad News, Challenges, or Points of Concern

Credit Quality Monitoring: While delinquencies remain flat, there is ongoing concern regarding macroeconomic risks, including inflation and labor market changes.

Residential Real Estate: Continued runoff in residential mortgages is seen as a headwind, with potential for impact if rates decrease significantly.

Commercial Real Estate (CRE): Elevated payoff activity expected, creating uncertainty in short-term growth.

Deposit Costs: Slight increase in deposit costs noted in Q3, raising concerns about competitive pressures and potential impacts on margins.

5Notable Q&A Insights

C&I Growth: Management expects continued strong growth in C&I loans as noncompete agreements expire, with a robust pipeline indicating further acceleration.

Fee Income: Q3 included a one-time asset gain, leading to expectations of a decline in fee income in Q4, though underlying capital markets and commercial production remain strong.

Expense Management: Personnel expenses are expected to remain stable, with a focus on managing costs while driving growth.

Market Positioning: Management remains open to opportunistic hiring and market expansion, emphasizing organic growth but not ruling out M&A if suitable opportunities arise. Overall, Associated Banc-Corp demonstrated strong financial performance in Q3 2025, with a focus on strategic growth initiatives and maintaining credit quality amidst macroeconomic uncertainties.