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Customers Bancorp Reports Results for Fourth Quarter and Full Year 2023

By: Customers Bancorp, Inc. via Business Wire

January 25, 2024 at 17:00 PM EST

Customers Bancorp, Inc. (NYSE:CUBI):

Fourth Quarter 2023 Highlights

Q4 2023 net income available to common shareholders was $58.2 million, or $1.79 per diluted share; ROAA was 1.16% and ROCE was 15.93%.
Q4 2023 core earnings* were $61.6 million, or $1.90 per diluted share; Core ROAA* was 1.22% and Core ROCE* was 16.87%.
CET 1 capital ratio of 12.2%¹ at December 31, 2023, compared to 11.3% at September 30, 2023, surpassing 11.0% - 11.5% target.
TCE / TA ratio* of 7.0% at December 31, 2023, compared to 6.5% at September 30, 2023, achieving stated target.
Q4 2023 net interest margin, tax equivalent (“NIM”) was 3.31%, compared to Q3 2023 NIM of 3.70%. Q3 2023 NIM included the benefit of outsized discount accretion of roughly 50 basis points. Normalizing for this outsized accretion, Q4 2023 NIM expanded by 11 basis points.
Total deposits decreased by $275.1 million in Q4 2023 from Q3 2023 with a significant positive mix shift. Q4 2023 core deposit growth of $1.1 billion funded in part the repayment of maturing wholesale CDs of $0.7 billion and the planned outflow of student-related deposit accounts serviced by BMTX of $0.6 billion.
Total estimated insured deposits were 77%² of total deposits at December 31, 2023, with immediately available liquidity covering uninsured deposits by approximately 202%.
Non-performing assets were $27.2 million, or 0.13% of total assets, at December 31, 2023 compared to 0.14% at September 30, 2023. Allowance for credit losses on loans and leases equaled 499% of non-performing loans at December 31, 2023, compared to 466% at September 30, 2023.
Q4 2023 provision for credit losses on loans and leases of $13.4 million was lower than Q3 2023 largely driven by lower balances in loans held for investment.
Q4 2023 book value per share and tangible book value per share* both grew by approximately $2.26, or 5.0% over Q3 2023, driven by strong quarterly earnings combined with decreased AOCI losses of $13.2 million over the same time period.

______________________________________________
*		Non-GAAP measure. Customers’ reasons for the use of the non-GAAP measure and a detailed reconciliation between the non-GAAP measure and the comparable GAAP amount are included at the end of this document.
1		Regulatory capital ratios as of December 31, 2023 are estimates.
2		Uninsured deposits (estimate) of $5.4 billion to be reported on the Bank's call report, less deposits of $1.1 billion collateralized by standby letters of credit from the FHLB and from our affiliates of $118.0 million.

Full Year 2023 Highlights

2023 net income available to common shareholders was $235.4 million, or $7.32 per diluted share; ROAA was 1.16% and ROCE was 17.33%.
2023 core earnings* were $248.2 million, or $7.72 per diluted share; Core ROAA* was 1.22% and Core ROCE* was 18.27%.
Record 2023 net interest income of $687.4 million.
CET 1 capital ratio of 12.2%¹ at December 31, 2023, compared to 9.6% at December 31, 2022, surpassing 11.0% - 11.5% target.
TCE / TA ratio* of 7.0% at December 31, 2023, compared to 6.0% at December 31, 2022.
2023 NIM was 3.29%, an increase of 10 basis points over 2022 NIM of 3.19%.
Non-performing assets were $27.2 million, or 0.13% of total assets, at December 31, 2023 compared to $30.8 million, or 0.15% of total assets, at December 31, 2022. Allowance for credit losses on loans and leases equaled 499% of non-performing loans at December 31, 2023, compared to 426% at December 31, 2022.
Book value per share and tangible book value per share* grew year over year by approximately $8.65 or 22.1%, driven by strong 2023 annual earnings combined with the decreased AOCI losses of $26.5 million over the same time period. Tangible book value per share* has grown at a 15% compound annual growth rate (CAGR) over the past 5 years, significantly higher than the regional bank peer median³ of 4%.
Repurchased 1,379,883 common shares at a weighted-average price of $28.58 for $39.8 million in 2023.

______________________________________________
*		Non-GAAP measure. Customers’ reasons for the use of the non-GAAP measure and a detailed reconciliation between the non-GAAP measure and the comparable GAAP amount is included at the end of this document.
1		Regulatory capital ratios as of December 31, 2023 are estimates.
2		Uninsured deposits (estimate) of $5.4 billion to be reported on the Bank's call report, less deposits of $1.1 billion collateralized by standby letters of credit from the FHLB and from our affiliates of $118.0 million.
3		Regional bank peers based on selected 2023 proxy peers with a reporting date on or before January 24, 2024 before market close.

CEO Commentary

“We are pleased to share our fourth quarter and full year 2023 results as we continued to execute on our strategic priorities and delivered again for shareholders,” said Customers Bancorp Chairman and CEO Jay Sidhu. “While the banking industry has stabilized following the challenges in early 2023, higher interest rates and less liquidity in the banking system remain headwinds for all banks. We again demonstrated the sustainability of our differentiated deposit franchise by growing core deposits by $1.1 billion in the fourth quarter which funded in part the repayment of maturing wholesale CDs of $743 million and the planned outflow of student-related deposit accounts serviced by BMTX totaling approximately $637 million. Additional liquidity inflows primarily from sales of investment securities were used to payoff $340 million in callable FHLB advances. The core deposit growth was again broad-based with more than 20 different channels increasing balances and roughly half contributing $25 million or more. Non-interest bearing deposits as a percentage of total deposits remained relatively flat at 25%. Excluding the outsized accretion we experienced in the third quarter, our net interest margin continued to expand in the fourth quarter in contrast to the industry trends. Capital levels continued to increase substantially as evidenced by two consecutive quarters with a 50 basis point increase in our TCE / TA ratio* and a 90 basis point increase in our CET 1 ratio. In the last three quarters, we have increased our TCE / TA ratio* by 110 basis points to 7.0% and our CET 1 ratio by 260 basis points to 12.2%. We remain well-positioned to continue strengthening our deposit franchise, improve our profitability, and maintain our capital ratios,” stated Jay Sidhu.

“Our Q4 2023 GAAP earnings were $58.2 million, or $1.79 per diluted share, and core earnings were $61.6 million, or $1.90 per diluted share, considerably above consensus estimates. At December 31, 2023, our deposit base was well diversified, with approximately 77%² of total deposits insured. We maintain a strong liquidity position, with $8.5 billion of liquidity immediately available, which covers approximately 202% of uninsured deposits² and our loan to deposit ratio was 74%. We continue to focus loan production where we have a holistic and primary relationship. We are seeing attractive new origination opportunities. We have ample liquidity and capital, which we plan to deploy in 2024, to support the needs of our customers. At December 31, 2023, we had $3.8 billion of cash on hand, which we believe is prudent balance sheet and liquidity management in the current environment. Asset quality remains exceptional with our NPA ratio down slightly at just 0.13% of total assets and reserve levels are robust at over 499% of total non-performing loans at the end of Q4 2023. Our exposure to higher risk commercial real estate such as the office and retail sectors is minimal, each representing only 1% of the loan portfolio. Continued execution on our strategic priorities has positioned us favorably for success in 2024 from a capital, credit, liquidity, interest rate risk and earnings perspective. We will remain disciplined, but opportunistic, with our balance sheet capacity to minimize risk and maintain robust capital levels. We are extremely proud of the progress we made in 2023 and are confident in our risk management capabilities and ability to provide excellent service to our clients in all operating environments. We are excited and optimistic about the opportunities in 2024 and beyond,” Jay Sidhu continued.

______________________________________________
*		Non-GAAP measure. Customers’ reasons for the use of the non-GAAP measure and a detailed reconciliation between the non-GAAP measure and the comparable GAAP amount are included at the end of this document.
1		Regulatory capital ratios as of December 31, 2023 are estimates.
2		Uninsured deposits (estimate) of $5.4 billion to be reported on the Bank's call report, less deposits of $1.1 billion collateralized by standby letters of credit from the FHLB and from our affiliates of $118.0 million.

Financial Highlights

(Dollars in thousands, except per share data)	At or Three Months Ended						Increase (Decrease)
(Dollars in thousands, except per share data)	December 31, 2023			September 30, 2023			Increase (Decrease)
Profitability Metrics:
Net income available for common shareholders	$	58,223		$	82,953		$	(24,730	)	(29.8	)%
Diluted earnings per share	$	1.79		$	2.58		$	(0.79	)	(30.6	)%
Core earnings*	$	61,633		$	83,294		$	(21,661	)	(26.0	)%
Core earnings per share*	$	1.90		$	2.59		$	(0.69	)	(26.6	)%
Return on average assets (“ROAA”)		1.16	%		1.57	%		(0.41	)
Core ROAA*		1.22	%		1.57	%		(0.35	)
Return on average common equity (“ROCE”)		15.93	%		23.97	%		(8.04	)
Core ROCE*		16.87	%		24.06	%		(7.19	)
Adjusted pre-tax pre-provision net income*	$	101,884		$	128,564		$	(26,680	)	(20.8	)%
Net interest margin, tax equivalent		3.31	%		3.70	%		(0.39	)
Yield on loans (Loan yield)		7.30	%		7.87	%		(0.57	)
Cost of deposits		3.39	%		3.24	%		0.15
Efficiency ratio		49.08	%		41.01	%		8.07
Core efficiency ratio*		46.70	%		41.04	%		5.66
Non-interest expense to average total assets		1.75	%		1.62	%		0.13
Core non-interest expense to average total assets*		1.67	%		1.62	%		0.05
Balance Sheet Trends:
Total assets	$	21,316,265		$	21,857,152		$	(540,887	)	(2.5	)%
Total cash and investment securities	$	7,355,156		$	7,371,551		$	(16,395	)	(0.2	)%
Total loans and leases	$	13,202,084		$	13,713,482		$	(511,398	)	(3.7	)%
Non-interest bearing demand deposits	$	4,422,494		$	4,758,682		$	(336,188	)	(7.1	)%
Total deposits	$	17,920,236		$	18,195,364		$	(275,128	)	(1.5	)%
Capital Metrics:
Common Equity	$	1,500,600		$	1,423,813		$	76,787		5.4	%
Tangible Common Equity*	$	1,496,971		$	1,420,184		$	76,787		5.4	%
Common Equity to Total Assets		7.0	%		6.5	%		0.5
Tangible Common Equity to Tangible Assets*		7.0	%		6.5	%		0.5
Book Value per common share	$	47.73		$	45.47		$	2.26		5.0	%
Tangible Book Value per common share*	$	47.61		$	45.36		$	2.25		5.0	%
Common equity Tier 1 capital ratio ⁽¹⁾		12.2	%		11.3	%		0.9
Total risk based capital ratio ⁽¹⁾		15.3	%		14.3	%		1.0

(1) Regulatory capital ratios as of December 31, 2023 are estimates.
* Non-GAAP measure. Customers’ reasons for the use of the non-GAAP measure and a detailed reconciliation between the non-GAAP measure and the comparable GAAP amount are included at the end of this document.

Financial Highlights

(Dollars in thousands, except per share data)	At or Three Months Ended						Increase (Decrease)					Twelve Months Ended						Increase (Decrease)
(Dollars in thousands, except per share data)	December 31, 2023			December 31, 2022			Increase (Decrease)					December 31, 2023			December 31, 2022			Increase (Decrease)
Profitability Metrics:
Net income available for common shareholders	$	58,223		$	25,623		$	32,600		127.2	%	$	235,448		$	218,402		$	17,046		7.8	%
Diluted earnings per share	$	1.79		$	0.77		$	1.02		132.5	%	$	7.32		$	6.51		$	0.81		12.4	%
Core earnings*	$	61,633		$	39,368		$	22,265		56.6	%	$	248,233		$	256,415		$	(8,182	)	(3.2	)%
Core earnings per share*	$	1.90		$	1.19		$	0.71		59.7	%	$	7.72		$	7.63		$	0.09		1.2	%
Return on average assets (“ROAA”)		1.16	%		0.55	%		0.61					1.16	%		1.13	%		0.03
Core ROAA*		1.22	%		0.81	%		0.41					1.22	%		1.32	%		(0.10	)
Return on average common equity (“ROCE”)		15.93	%		8.05	%		7.88					17.33	%		17.40	%		(0.07	)
Core ROCE*		16.87	%		12.36	%		4.51					18.27	%		20.43	%		(2.16	)
Adjusted pre-tax pre-provision net income*	$	101,884		$	81,377		$	20,507		25.2	%	$	416,563		$	400,712		$	15,851		4.0	%
Net interest margin, tax equivalent		3.31	%		2.67	%		0.64					3.29	%		3.19	%		0.10
Yield on loans (Loan yield)		7.30	%		5.64	%		1.66					7.16	%		5.00	%		2.16
Cost of deposits		3.39	%		2.73	%		0.66					3.27	%		1.31	%		1.96
Efficiency ratio		49.08	%		49.20	%		(0.12	)				46.49	%		44.81	%		1.68
Core efficiency ratio*		46.70	%		49.12	%		(2.42	)				45.45	%		43.02	%		2.43
Non-interest expense to average total assets		1.75	%		1.50	%		0.25					1.64	%		1.51	%		0.13
Core non-interest expense to average total assets*		1.67	%		1.50	%		0.17					1.62	%		1.50	%		0.12
Balance Sheet Trends:
Total assets	$	21,316,265		$	20,896,112		$	420,153		2.0	%
Total cash and investment securities	$	7,355,156		$	4,283,565		$	3,071,591		71.7	%
Total loans and leases	$	13,202,084		$	15,794,671		$	(2,592,587	)	(16.4	)%
Non-interest bearing demand deposits	$	4,422,494		$	1,885,045		$	2,537,449		134.6	%
Total deposits	$	17,920,236		$	18,156,953		$	(236,717	)	(1.3	)%
Capital Metrics:
Common Equity	$	1,500,600		$	1,265,167		$	235,433		18.6	%
Tangible Common Equity*	$	1,496,971		$	1,261,538		$	235,433		18.7	%
Common Equity to Total Assets		7.0	%		6.0	%		1.0
Tangible Common Equity to Tangible Assets*		7.0	%		6.0	%		1.0
Book Value per common share	$	47.73		$	39.08		$	8.65		22.1	%
Tangible Book Value per common share*	$	47.61		$	38.97		$	8.64		22.2	%
Common equity Tier 1 capital ratio ⁽¹⁾		12.2	%		9.6	%		2.6
Total risk based capital ratio ⁽¹⁾		15.3	%		12.2	%		3.1

(1) Regulatory capital ratios as of December 31, 2023 are estimates.
* Non-GAAP measure. Customers’ reasons for the use of the non-GAAP measure and a detailed reconciliation between the non-GAAP measure and the comparable GAAP amount are included at the end of this document.

Key Balance Sheet Trends

Loans and Leases

The following table presents the composition of total loans and leases as of the dates indicated:

(Dollars in thousands)	December 31, 2023		% of Total		September 30, 2023		% of Total		December 31, 2022		% of Total
Loans and Leases Held for Investment
Commercial:
Commercial & industrial:
Specialty lending	$	5,006,693	38.9	%	$	5,422,161	40.0	%	$	5,412,887	35.0	%
Other commercial & industrial		1,087,582	8.5			1,115,364	8.2			1,135,336	7.4
Loans to mortgage companies		1,014,742	7.9			1,042,549	7.7			1,447,919	9.4
Multifamily		2,138,622	16.6			2,130,213	15.7			2,213,019	14.3
Commercial real estate owner occupied		797,319	6.2			794,815	5.9			885,339	5.7
Loans receivable, PPP		74,735	0.6			137,063	1.0			998,153	6.5
Commercial real estate non-owner occupied		1,177,650	9.2			1,178,203	8.7			1,290,730	8.3
Construction		166,393	1.2			252,588	1.8			162,009	1.0
Total commercial loans and leases		11,463,736	89.1			12,072,956	89.0			13,545,392	87.6
Consumer:
Residential		484,435	3.8			483,133	3.6			497,952	3.3
Manufactured housing		38,670	0.3			40,129	0.3			45,076	0.3
Installment:
Personal		555,533	4.3			629,843	4.6			964,641	6.2
Other		319,393	2.5			337,053	2.5			413,298	2.7
Total installment loans		874,926	6.8			966,896	7.1			1,377,939	8.9
Total consumer loans		1,398,031	10.9			1,490,158	11.0			1,920,967	12.4
Total loans and leases held for investment	$	12,861,767	100.0	%	$	13,563,114	100.0	%	$	15,466,359	100.0	%

Loans Held for Sale
Commercial:
Multifamily	$	—	—	%	$	—	—	%	$	4,079	1.2	%
Commercial real estate non-owner occupied		—	—			—	—			—	—
Total commercial loans and leases		—	—			—	—			4,079	1.2
Consumer:
Residential		1,215	0.3			1,005	0.7			829	0.3
Installment:
Personal		151,040	44.4			124,848	83.0			133,801	40.8
Other		188,062	55.3			24,515	16.3			189,603	57.8
Total installment loans		339,102	99.7			149,363	99.3			323,404	98.6
Total consumer loans		340,317	100.0			150,368	100.0			324,233	98.8
Total loans held for sale	$	340,317	100.0	%	$	150,368	100.0	%	$	328,312	100.0	%

Total loans and leases portfolio	$	13,202,084			$	13,713,482			$	15,794,671

Loans and Leases Held for Investment

Loans and leases held for investment were $12.9 billion at December 31, 2023, down $701.3 million, or 5.2%, from September 30, 2023. Specialty lending decreased $415.5 million, or 7.7% quarter-over-quarter, to $5.0 billion. Construction loans decreased $86.2 million, or 34.1% quarter-over-quarter, to $166.4 million. Loans to mortgage companies decreased $27.8 million, or 2.7% quarter-over-quarter due to lower mortgage activity. Consumer installment loans held for investment decreased $92.0 million, or 9.5% quarter-over-quarter, to $874.9 million due to the continued build out of the held-for-sale strategy and de-risking of the held-for-investment loan portfolio in 2023.

Loans and leases held for investment of $12.9 billion at December 31, 2023 was down $2.6 billion, or 16.8%, year-over-year, largely driven by reduced balances in PPP loans of $923.4 million, consumer installment loans of $503.0 million, or 36.5% year-over-year, loans to mortgage companies of $433.2 million and specialty lending of $406.2 million.

Loans Held for Sale

Loans held for sale increased $189.9 million quarter-over-quarter, and were $340.3 million at December 31, 2023 due to the continued build out of the held-for-sale strategy in 2023.

Allowance for Credit Losses on Loans and Leases

The following table presents the allowance for credit losses on loans and leases as of the dates and for the periods presented:

	At or Three Months Ended						Increase (Decrease)			At or Three Months Ended						Increase (Decrease)
(Dollars in thousands)	December 31, 2023			September 30, 2023			Increase (Decrease)			December 31, 2023			December 31, 2022			Increase (Decrease)
Allowance for credit losses on loans and leases	$	135,311		$	139,213		$	(3,902	)	$	135,311		$	130,924		$	4,387
Provision (benefit) for credit losses on loans and leases	$	13,420		$	17,055		$	(3,635	)	$	13,420		$	27,891		$	(14,471	)
Net charge-offs from loans held for investment	$	17,322		$	17,498		$	(176	)	$	17,322		$	27,164		$	(9,842	)
Annualized net charge-offs to average loans and leases		0.51	%		0.50	%					0.51	%		0.70	%
Coverage of credit loss reserves for loans and leases held for investment		1.13	%		1.10	%					1.13	%		0.93	%

Net charge-offs were relatively stable with $17.3 million in Q4 2023, compared to $17.5 million in Q3 2023 and decreased compared to $27.2 million in Q4 2022.

Provision (benefit) for Credit Losses

	Three Months Ended					Increase (Decrease)			Three Months Ended					Increase (Decrease)
(Dollars in thousands)	December 31, 2023			September 30, 2023		Increase (Decrease)			December 31, 2023			December 31, 2022		Increase (Decrease)
Provision for credit losses on loans and leases	$	13,420		$	17,055	$	(3,635	)	$	13,420		$	27,891	$	(14,471	)
Provision (benefit) for credit losses on available for sale debt securities		103			801		(698	)		103			325		(222	)
Provision for credit losses		13,523			17,856		(4,333	)		13,523			28,216		(14,693	)
Provision (benefit) for credit losses on unfunded commitments		(136	)		48		(184	)		(136	)		153		(289	)
Total provision for credit losses	$	13,387		$	17,904	$	(4,517	)	$	13,387		$	28,369	$	(14,982	)

The provision for credit losses on loans and leases in Q4 2023 was $13.4 million, compared to $17.1 million in Q3 2023 and $27.9 million in Q4 2022. The lower provision in Q4 2023 was primarily due to lower balances in loans held for investment.

The provision for credit losses on available for sale investment securities in Q4 2023 was $0.1 million, compared to provision of $0.8 million in Q3 2023 and $0.3 million in Q4 2022.

Asset Quality

The following table presents asset quality metrics as of the dates indicated:

(Dollars in thousands)	December 31, 2023			September 30, 2023			Increase (Decrease)			December 31, 2023			December 31, 2022			Increase (Decrease)
Non-performing assets (“NPAs”):
Nonaccrual / non-performing loans (“NPLs”)	$	27,110		$	29,867		$	(2,757	)	$	27,110		$	30,737		$	(3,627	)
Non-performing assets	$	27,209		$	29,970		$	(2,761	)	$	27,209		$	30,783		$	(3,574	)
NPLs to total loans and leases		0.21	%		0.22	%					0.21	%		0.19	%
Reserves to NPLs		499.12	%		466.11	%					499.12	%		425.95	%
NPAs to total assets		0.13	%		0.14	%					0.13	%		0.15	%

Loans and leases ⁽¹⁾ risk ratings:
Commercial loans and leases ⁽²⁾
Pass	$	9,955,243		$	10,503,731		$	(548,488	)	$	9,955,243		$	10,793,980		$	(838,737	)
Special Mention		196,182			189,329			6,853			196,182			138,829			57,353
Substandard		339,664			280,267			59,397			339,664			291,118			48,546
Total commercial loans and leases		10,491,089			10,973,327			(482,238	)		10,491,089			11,223,927			(732,838	)
Consumer loans
Performing		1,379,603			1,473,493			(93,890	)		1,379,603			1,899,376			(519,773	)
Non-performing		18,428			16,665			1,763			18,428			21,591			(3,163	)
Total consumer loans		1,398,031			1,490,158			(92,127	)		1,398,031			1,920,967			(522,936	)
Loans and leases receivable ⁽¹⁾	$	11,889,120		$	12,463,485		$	(574,365	)	$	11,889,120		$	13,144,894		$	(1,255,774	)

(1) Risk ratings are assigned to loans and leases held for investment, and excludes loans held for sale and loans receivable, mortgage warehouse, at fair value.
(2) Excludes loan receivable, PPP, as eligible PPP loans are fully guaranteed by the Small Business Administration.

Over the last decade, the Bank has developed a suite of commercial loan products with one particularly important common denominator: relatively low credit risk assumption. The Bank’s C&I, loans to mortgage companies, corporate and specialty lending lines of business, and multifamily loans for example, are characterized by conservative underwriting standards and low loss rates. Because of this emphasis, the Bank’s credit quality to date has been incredibly healthy despite an adverse economic environment. Maintaining strong asset quality also requires a highly active portfolio monitoring process. In addition to frequent client outreach and monitoring at the individual loan level, management employs a bottom-up data driven approach to analyze the commercial portfolio.

Total consumer installment loans held for investment at December 31, 2023 were less than 5% of total assets and approximately 7% of total loans and leases held for investment, and were supported by an allowance for credit losses of $56.4 million. At December 31, 2023, the consumer installment portfolio had the following characteristics: average original FICO score of 734, average debt-to-income of 19% and average borrower income of $107 thousand.

Non-performing loans at December 31, 2023 remained relatively stable at 0.21% of total loans and leases, compared to 0.22% at September 30, 2023 and 0.19% at December 31, 2022.

Investment Securities

The investment securities portfolio, including debt securities classified as available for sale (“AFS”) and held to maturity (“HTM”) provides periodic cash flows through regular maturities and amortization, can be used as collateral to secure additional funding, and is an important component of the Bank’s liquidity position.

The following table presents the composition of the investment securities portfolio as of the dates indicated:

(Dollars in thousands)	December 31, 2023		September 30, 2023		December 31, 2022
Debt securities, available for sale	$	2,376,860	$	2,746,729	$	2,961,015
Equity securities		28,780		26,478		26,485
Investment securities, at fair value		2,405,640		2,773,207		2,987,500
Debt securities, held to maturity		1,103,170		1,178,370		840,259
Total investment securities portfolio	$	3,508,810	$	3,951,577	$	3,827,759

Critically important to performance during the recent banking crisis are the characteristics of a bank’s securities portfolio. While there may be virtually no credit risk in some of these portfolios, holding longer term and lower yielding securities is creating challenges for many banks. Customers’ securities portfolio is highly liquid, short in duration, and high in yield. At December 31, 2023, the AFS debt securities portfolio had a spot yield of 5.12%, an effective duration of approximately 1.5 years, and approximately 41% are variable rate. Additionally, 59% of the AFS securities portfolio was AAA rated at December 31, 2023.

At December 31, 2023, the HTM debt securities portfolio represented only 5.2% of total assets at December 31, 2023, had a spot yield of 4.31% and an effective duration of approximately 3.0 years. Additionally, at December 31, 2023, approximately 39% of the HTM securities were AAA rated and 52% were credit enhanced asset backed securities with no current expectation of credit losses.

Deposits

The following table presents the composition of our deposit portfolio as of the dates indicated:

(Dollars in thousands)	December 31, 2023		% of Total		September 30, 2023		% of Total		December 31, 2022		% of Total
Demand, non-interest bearing	$	4,422,494	24.7	%	$	4,758,682	26.2	%	$	1,885,045	10.4	%
Demand, interest bearing		5,580,527	31.1			5,824,410	32.0			8,476,027	46.7
Total demand deposits		10,003,021	55.8			10,583,092	58.2			10,361,072	57.1
Savings		1,402,941	7.8			1,118,353	6.1			811,798	4.5
Money market		3,226,395	18.0			2,499,593	13.7			2,734,217	15.1
Time deposits		3,287,879	18.4			3,994,326	22.0			4,249,866	23.3
Total deposits	$	17,920,236	100.0	%	$	18,195,364	100.0	%	$	18,156,953	100.0	%

Total deposits decreased $275.1 million, or 1.5%, to $17.9 billion at December 31, 2023 as compared to the prior quarter. Money market deposits increased $726.8 million, or 29.1%, to $3.2 billion and savings deposits increased $284.6 million, or 25.4%, to $1.4 billion. These increases were offset by decreases in time deposits of $706.4 million, or 17.7%, to $3.3 billion, non-interest bearing demand deposits of $336.2 million, or 7.1%, to $4.4 billion and interest bearing demand deposits of $243.9 million, or 4.2%, to $5.6 billion. There was also an outflow of student-related deposit accounts serviced by BMTX of $0.6 billion, including the planned transfer of approximately $430.0 million to a new partner bank on December 1st and expected seasonal outflows of $0.2 billion. The total average cost of deposits increased by 15 basis points to 3.39% in Q4 2023 from 3.24% in the prior quarter largely driven by the increase in market interest rates and a shift in deposit mix during the fourth quarter including the outflow of student-related deposits serviced by BMTX. Total estimated uninsured deposits was $4.2 billion¹, or 23% of total deposits (inclusive of accrued interest) at December 31, 2023. Customers is also highly focused on total deposits with contractual term to manage its liquidity profile and the funding of loans and securities.

Total deposits decreased $236.7 million, or 1.3%, to $17.9 billion at December 31, 2023 as compared to a year ago. Non-interest bearing demand deposits increased $2.5 billion, or 134.6%, to $4.4 billion, savings deposits increased $591.1 million, or 72.8%, to $1.4 billion and money market deposits increased $492.2 million, or 18.0%, to $3.2 billion. These increases were offset by decreases in interest bearing demand deposits of $2.9 billion, or 34.2%, to $5.6 billion and time deposits of $962.0 million, or 22.6% to $3.3 billion. The total average cost of deposits increased by 66 basis points to 3.39% in Q4 2023 from 2.73% in the prior year primarily due to higher market interest rates and a shift in deposit mix.

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1		Uninsured deposits (estimate) of $5.4 billion to be reported on the Bank's call report, less deposits of $1.1 billion collateralized by standby letters of credit from the FHLB and from our affiliates of $118.0 million.

Borrowings

The following table presents the composition of our borrowings as of the dates indicated:

(Dollars in thousands)	December 31, 2023		September 30, 2023		December 31, 2022
FHLB advances	$	1,203,207	$	1,529,839	$	800,000
Senior notes		123,840		123,775		123,580
Subordinated debt		182,230		182,161		181,952
Total borrowings	$	1,509,277	$	1,835,775	$	1,105,532

Total borrowings decreased $326.5 million, or 17.8%, to $1.5 billion at December 31, 2023 as compared to the prior quarter. This decrease primarily resulted from the repayment of $340.0 million in callable FHLB advances. As of December 31, 2023, Customers’ immediately available borrowing capacity with the FRB and FHLB was approximately $6.9 billion, of which $1.2 billion of available capacity was utilized in borrowings and $1.1 billion was utilized to collateralize deposits.

Total borrowings increased $403.7 million, or 36.5%, to $1.5 billion at December 31, 2023 as compared to a year ago. This increase primarily resulted from an increase in FHLB advances to ensure ample cash on hand given the heightened liquidity risk in the banking system, particularly among regional banks since early March 2023, net of repayments of $340.0 million and $510.0 million in callable FHLB advances in Q4 2023 and Q3 2023, respectively.

Capital

The following table presents certain capital amounts and ratios as of the dates indicated:

(Dollars in thousands except per share data)	December 31, 2023			September 30, 2023			December 31, 2022
Customers Bancorp, Inc.
Common Equity	$	1,500,600		$	1,423,813		$	1,265,167
Tangible Common Equity*	$	1,496,971		$	1,420,184		$	1,261,538
Common Equity to Total Assets		7.0	%		6.5	%		6.0	%
Tangible Common Equity to Tangible Assets*		7.0	%		6.5	%		6.0	%
Book Value per common share	$	47.73		$	45.47		$	39.08
Tangible Book Value per common share*	$	47.61		$	45.36		$	38.97
Common equity Tier 1 (“CET 1”) capital ratio ⁽¹⁾		12.2	%		11.3	%		9.6	%
Total risk based capital ratio ⁽¹⁾		15.3	%		14.3	%		12.2	%

(1) Regulatory capital ratios as of December 31, 2023 are estimates.
* Non-GAAP measure. Customers’ reasons for the use of the non-GAAP measure and a detailed reconciliation between the non-GAAP measure and the comparable GAAP amount are included at the end of this document.

Customers Bancorp’s common equity increased $76.8 million to $1.5 billion, and tangible common equity* increased $76.8 million to $1.5 billion, at December 31, 2023 compared to the prior quarter, respectively, primarily from earnings of $58.2 million and decreased unrealized losses on investment securities of $13.2 million (net of taxes) deferred in accumulated other comprehensive income (“AOCI”). Similarly, book value per common share increased to $47.73 from $45.47, and tangible book value per common share* increased to $47.61 from $45.36, at December 31, 2023 and September 30, 2023, respectively.

Customers Bancorp’s common equity increased $235.4 million to $1.5 billion, and tangible common equity* increased $235.4 million to $1.5 billion, at December 31, 2023 compared to a year ago, respectively, primarily from earnings of $235.4 million and decreased unrealized losses on investment securities in AOCI of $26.5 million (net of taxes), partially offset by $39.8 million of common share repurchases. Similarly, book value per common share increased to $47.73 from $39.08, and tangible book value per common share* increased to $47.61 from $38.97, at December 31, 2023 and December 31, 2022, respectively.

At the Customers Bancorp level, the CET 1 capital ratio (estimate), total risk based capital ratio (estimate), common equity to total assets ratio and tangible common equity to tangible assets ratio* (“TCE / TA ratio”) were 12.2%, 15.3%, 7.0%, and 7.0%, respectively, at December 31, 2023.

At the Customers Bank level, capital levels remained strong and well above regulatory minimums. At December 31, 2023, Tier 1 capital (estimate) and total risk based capital (estimate) were 13.7% and 15.3%, respectively.

“Even though we remain well capitalized by all regulatory measures, we are committed to maintaining our CET 1 ratio around 11.5% and growing our TCE / TA ratio* to 7.5% in 2024,” stated Jay Sidhu.

Key Profitability Trends

Net Interest Income

Net interest income totaled $172.5 million in Q4 2023, a decrease of $27.3 million from Q3 2023, primarily due to lower interest income from the acquired Venture Banking portfolio that had outsized discount accretion in Q3 2023.

“We experienced continued momentum in net interest income in the fourth quarter, despite elective reductions in loan balances. Loan balance reductions were in part due to exiting certain credits with less attractive pricing and clients without holistic banking relationships. Excluding the outsized accretion recognized in the third quarter on the acquired loan portfolio from the FDIC, our fourth quarter net interest income was in-line relative to the third quarter,” stated Customers Bancorp President Sam Sidhu.

Net interest income totaled $172.5 million in Q4 2023, an increase of $37.4 million from Q4 2022. This increase was due to higher interest income of $76.3 million on variable rate lower credit risk specialty lending verticals, which included the acquired Venture Banking portfolio, investment securities and interest earning deposits, offset in part by higher interest expenses on deposits and other borrowings of $38.9 million primarily resulting from increased market interest rates and higher average balances of other borrowings. Interest-earning asset growth was primarily driven by an increase in interest earning deposits, offset in part by decreases in PPP loans, as the PPP program was substantially completed in Q1 2023, consumer installment loans and commercial loans to mortgage companies. Total consumer installment loans decreased in Q4 2023 as compared to Q4 2022, as installment loans held for investment decreased primarily for risk management purposes and the implementation of a held-for-sale strategy.

Non-Interest Income

The following table presents details of non-interest income for the periods indicated:

	Three Months Ended						Increase (Decrease)			Three Months Ended						Increase (Decrease)
(Dollars in thousands)	December 31, 2023			September 30, 2023			Increase (Decrease)			December 31, 2023			December 31, 2022			Increase (Decrease)
Commercial lease income	$	9,035		$	8,901		$	134		$	9,035		$	8,135		$	900
Loan fees		5,926			6,029			(103	)		5,926			4,017			1,909
Bank-owned life insurance		2,160			1,973			187			2,160			1,975			185
Mortgage warehouse transactional fees		927			1,018			(91	)		927			1,295			(368	)
Gain (loss) on sale of SBA and other loans		(91	)		(348	)		257			(91	)		—			(91	)
Net gain (loss) on sale of investment securities		(145	)		(429	)		284			(145	)		(16,937	)		16,792
Legal settlement gain		—			—			—			—			7,519			(7,519	)
Other		860			631			229			860			1,341			(481	)
Total non-interest income	$	18,672		$	17,775		$	897		$	18,672		$	7,345		$	11,327

Non-interest income totaled $18.7 million for Q4 2023, an increase of $0.9 million compared to Q3 2023. The increase was primarily due to decreases in losses on sales of loans and investment securities, and increases in death benefits paid by insurance carriers under bank-owned life insurance policies and commercial lease income.

Non-interest income totaled $18.7 million for Q4 2023, an increase of $11.3 million compared to Q4 2022. The increase was primarily due to a decrease of $16.8 million in net loss realized from the sales of investment securities, and an increase in loan fees of $1.9 million resulting from increased servicing-related revenue and unused line of credit fees, partially offset by a $7.5 million gain from a court-approved settlement with a third party PPP service provider in Q4 2022.

Non-Interest Expense

The following table presents details of non-interest expense for the periods indicated:

	Three Months Ended				Increase (Decrease)			Three Months Ended				Increase (Decrease)
(Dollars in thousands)	December 31, 2023		September 30, 2023		Increase (Decrease)			December 31, 2023		December 31, 2022		Increase (Decrease)
Salaries and employee benefits	$	33,965	$	33,845	$	120		$	33,965	$	29,194	$	4,771
Technology, communication and bank operations		16,887		15,667		1,220			16,887		18,604		(1,717	)
Commercial lease depreciation		7,357		7,338		19			7,357		6,518		839
Professional services		9,820		8,569		1,251			9,820		6,825		2,995
Loan servicing		3,779		3,858		(79	)		3,779		4,460		(681	)
Occupancy		2,320		2,471		(151	)		2,320		3,672		(1,352	)
FDIC assessments, non-income taxes and regulatory fees		13,977		8,551		5,426			13,977		2,339		11,638
Advertising and promotion		850		650		200			850		1,111		(261	)
Legal settlement expense		—		4,096		(4,096	)		—		—		—
Other		4,812		4,421		391			4,812		5,696		(884	)
Total non-interest expense	$	93,767	$	89,466	$	4,301		$	93,767	$	78,419	$	15,348

Non-interest expenses totaled $93.8 million in Q4 2023, an increase of $4.3 million compared to Q3 2023. The increase was primarily attributable to increases of $5.4 million in FDIC assessments, non-income taxes and regulatory fees resulting from higher FDIC assessments including the special assessment of $3.7 million, $1.3 million in professional fees and $1.2 million in technology, communication and bank operations mostly due to higher processing and software fees offset by lower servicing fees paid to BMTX. These increases were partially offset by $4.1 million of expenses from a settlement with a third party PPP service provider in Q3 2023. Q4 2023 core non-interest expenses* were $89.4 million, flat over Q3 2023.

Non-interest expenses totaled $93.8 million in Q4 2023, an increase of $15.3 million compared to Q4 2022. The increase was primarily attributable to increases of $11.6 million in FDIC assessments, non-income taxes and regulatory fees resulting primarily from higher FDIC assessments including the special assessment of $3.7 million, $4.8 million in salaries and employee benefits primarily due to higher headcount, annual merit increases and severance, and $3.0 million in professional fees. These increases were partially offset by decreases of $1.7 million in deposit servicing-related expenses mostly due to lower servicing fees and the discontinuation of interchange maintenance fees paid to BMTX offset by higher fees for processing and software as a service, and $1.4 million in occupancy mostly due to lower lease and maintenance expenses.

Taxes

Income tax expense decreased by $1.7 million to $21.8 million in Q4 2023 from $23.5 million in Q3 2023 primarily due to lower pre-tax income, partially offset by lower income tax credits.

Income tax expense increased by $14.7 million to $21.8 million in Q4 2023 from $7.1 million in Q4 2022 primarily due to higher pre-tax income and lower income tax credits.

The effective tax rate for Q4 2023 was 26%, and 24% for the full year 2023. Customers expects the full-year 2024 effective tax rate to be approximately 22% to 24%.

Outlook

“Looking forward, our strategy and risk management principles will remain unchanged. We’re focused on managing risk, strengthening our deposit franchise, further improving our profitability and maintaining our higher capital ratios. Our deposits are expected to grow modestly with continued improvement in the quality of deposits, reducing higher cost wholesale deposits with lower cost core deposits. We see attractive opportunities to deploy securities cash flows and cash into franchise-enhancing loan growth in 2024. Core EPS (excluding PPP)* significantly exceeded our target of $6.00 per diluted share and core return on common equity* was well in excess of our target of 15%. We also achieved the tangible book value per share* target of $45.00, inclusive of the impact of AOCI, a full quarter early, ending at $47.61. The management of non-interest expenses remains a priority for us. However, this will not deter us from making investments in deposit teams and new technologies to support efficient and responsible growth in the future. Operating efficiency has and will continue to be a differentiator of our business model, and we will continue to only make investments that generate long-term positive operating leverage and enable the organization to operate at a mid-40’s efficiency ratio. We remain committed to maintaining a CET 1 ratio around 11.5% in 2024, and growing our TCE / TA ratio* to 7.5%. We are committed to preserving superior credit quality, managing interest rate risk, maintaining robust liquidity, operating with higher capital ratios and generating positive operating leverage,” concluded Sam Sidhu.

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*		Non-GAAP measure. Customers' reasons for the use of the non-GAAP measure and a detailed reconciliation between the non-GAAP measure and the comparable GAAP amount are included at the end of this document.

Webcast
Date:		Friday, January 26, 2024
Time:		9:00 AM EST

The live audio webcast, presentation slides, and earnings press release will be made available at https://www.customersbank.com/investor-relations/ and at the Customers Bancorp 4th Quarter Earnings Webcast.

You may submit questions in advance of the live webcast by emailing our Communications Director, David Patti at dpatti@customersbank.com; questions may also be asked during the webcast through the webcast application.

The webcast will be archived for viewing on the Customers Bank Investor Relations page and available beginning approximately two hours after the conclusion of the live event.

Institutional Background

Customers Bancorp, Inc. (NYSE:CUBI) is one of the nation’s top-performing banking companies with about $21 billion in assets, making it one of the 80 largest bank holding companies in the US. Through its primary subsidiary, Customers Bank, commercial and consumer clients benefit from a full suite of technology-enabled tailored product experiences delivered by best-in-class customer service. In addition to traditional lines such as C&I lending, commercial real estate lending, and multifamily lending, Customers Bank also provides a number of national corporate banking services to Specialty Lending clients. Major accolades include:

#5 in top-performing banks with assets between $10 billion and $50 billion in 2022 per American Banker list;
#34 out of the 100 largest publicly traded banks in 2023 per Forbes; and
#64 on Fortune Magazine’s 2022 list of the 100 fastest growing companies in America.

A member of the Federal Reserve System with deposits insured by the Federal Deposit Insurance Corporation, Customers Bank is an equal opportunity lender. Learn more: www.customersbank.com.

“Safe Harbor” Statement

In addition to historical information, this press release may contain “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements with respect to Customers Bancorp, Inc.’s strategies, goals, beliefs, expectations, estimates, intentions, capital raising efforts, financial condition and results of operations, future performance and business. Statements preceded by, followed by, or that include the words “may,” “could,” “should,” “pro forma,” “looking forward,” “would,” “believe,” “expect,” “anticipate,” “estimate,” “intend,” “plan,” “project,” or similar expressions generally indicate a forward-looking statement. These forward-looking statements involve risks and uncertainties that are subject to change based on various important factors (some of which, in whole or in part, are beyond Customers Bancorp, Inc.’s control). Numerous competitive, economic, regulatory, legal and technological events and factors, among others, could cause Customers Bancorp, Inc.’s financial performance to differ materially from the goals, plans, objectives, intentions and expectations expressed in such forward-looking statements, including: a continuation of the recent turmoil in the banking industry, responsive measures taken by us and regulatory authorities to mitigate and manage related risks, regulatory actions taken that address related issues and the costs and obligations associated therewith, such as the FDIC special assessments, the impact of COVID-19 and its variants on the U.S. economy and customer behavior, the impact that changes in the economy have on the performance of our loan and lease portfolio, the market value of our investment securities, the continued success and acceptance of our blockchain payments system, the demand for our products and services and the availability of sources of funding, the effects of actions by the federal government, including the Board of Governors of the Federal Reserve System and other government agencies, that affect market interest rates and the money supply, actions that we and our customers take in response to these developments and the effects such actions have on our operations, products, services and customer relationships, higher inflation and its impacts, and the effects of any changes in accounting standards or policies. Customers Bancorp, Inc. cautions that the foregoing factors are not exclusive, and neither such factors nor any such forward-looking statement takes into account the impact of any future events. All forward-looking statements and information set forth herein are based on management’s current beliefs and assumptions as of the date hereof and speak only as of the date they are made. For a more complete discussion of the assumptions, risks and uncertainties related to our business, you are encouraged to review Customers Bancorp, Inc.’s filings with the Securities and Exchange Commission, including its most recent annual report on Form 10-K for the year ended December 31, 2022, subsequently filed quarterly reports on Form 10-Q and current reports on Form 8-K, including any amendments thereto, that update or provide information in addition to the information included in the Form 10-K and Form 10-Q filings, if any. Customers Bancorp, Inc. does not undertake to update any forward-looking statement whether written or oral, that may be made from time to time by Customers Bancorp, Inc. or by or on behalf of Customers Bank, except as may be required under applicable law.

Q4 2023 Overview

The following table presents a summary of key earnings and performance metrics for the quarter ended December 31, 2023 and the preceding four quarters, and full year 2023 and 2022:

CUSTOMERS BANCORP, INC. AND SUBSIDIARIES
EARNINGS SUMMARY - UNAUDITED

(Dollars in thousands, except per share data and stock price data)		Q4			Q3			Q2			Q1			Q4			Twelve Months Ended December 31,
			2023			2023			2023			2023			2022			2023			2022

GAAP Profitability Metrics:
Net income available to common shareholders		$	58,223		$	82,953		$	44,007		$	50,265		$	25,623		$	235,448		$	218,402
Per share amounts:
	Earnings per share - basic	$	1.86		$	2.65		$	1.41		$	1.58		$	0.79		$	7.49		$	6.69
	Earnings per share - diluted	$	1.79		$	2.58		$	1.39		$	1.55		$	0.77		$	7.32		$	6.51
	Book value per common share ⁽¹⁾	$	47.73		$	45.47		$	42.16		$	41.08		$	39.08		$	47.73		$	39.08
	CUBI stock price ⁽¹⁾	$	57.62		$	34.45		$	30.26		$	18.52		$	28.34		$	57.62		$	28.34
	CUBI stock price as % of book value ⁽¹⁾		121	%		76	%		72	%		45	%		73	%		121	%		73	%
Average shares outstanding - basic			31,385,043			31,290,581			31,254,125			31,819,203			32,413,459			31,435,647			32,632,751
Average shares outstanding - diluted			32,521,787			32,175,084			31,591,142			32,345,017			33,075,422			32,158,788			33,547,706
Shares outstanding ⁽¹⁾			31,440,906			31,311,254			31,282,318			31,239,750			32,373,697			31,440,906			32,373,697
Return on average assets (“ROAA”)			1.16	%		1.57	%		0.88	%		1.03	%		0.55	%		1.16	%		1.13	%
Return on average common equity (“ROCE”)			15.93	%		23.97	%		13.22	%		16.00	%		8.05	%		17.33	%		17.40	%
Net interest margin, tax equivalent			3.31	%		3.70	%		3.15	%		2.96	%		2.67	%		3.29	%		3.19	%
Efficiency ratio			49.08	%		41.01	%		49.25	%		47.71	%		49.20	%		46.49	%		44.81	%
Non-GAAP Profitability Metrics ⁽²⁾:
Core earnings		$	61,633		$	83,294		$	52,163		$	51,143		$	39,368		$	248,233		$	256,415
Adjusted pre-tax pre-provision net income		$	101,884		$	128,564		$	96,833		$	89,282		$	81,377		$	416,563		$	400,712
Per share amounts:
	Core earnings per share - diluted	$	1.90		$	2.59		$	1.65		$	1.58		$	1.19		$	7.72		$	7.63
	Tangible book value per common share ⁽¹⁾	$	47.61		$	45.36		$	42.04		$	40.96		$	38.97		$	47.61		$	38.97
	CUBI stock price as % of tangible book value ⁽¹⁾		121	%		76	%		72	%		45	%		73	%		121	%		73	%
Core ROAA			1.22	%		1.57	%		1.03	%		1.05	%		0.81	%		1.22	%		1.32	%
Core ROCE			16.87	%		24.06	%		15.67	%		16.28	%		12.36	%		18.27	%		20.43	%
Adjusted ROAA - pre-tax and pre-provision			1.90	%		2.32	%		1.79	%		1.72	%		1.56	%		1.94	%		1.99	%
Adjusted ROCE - pre-tax and pre-provision			26.82	%		36.04	%		28.01	%		27.33	%		24.59	%		29.58	%		31.16	%
Net interest margin, tax equivalent, excluding PPP loans			3.33	%		3.75	%		3.20	%		2.80	%		2.87	%		3.28	%		3.16	%
Core efficiency ratio			46.70	%		41.04	%		47.84	%		47.09	%		49.12	%		45.45	%		43.02	%
Asset Quality:
Net charge-offs		$	17,322		$	17,498		$	15,564		$	18,651		$	27,164		$	69,035		$	66,368
Annualized net charge-offs to average total loans and leases			0.51	%		0.50	%		0.42	%		0.49	%		0.70	%		0.48	%		0.45	%
Non-performing loans (“NPLs”) to total loans and leases⁽¹⁾			0.21	%		0.22	%		0.20	%		0.21	%		0.19	%		0.21	%		0.19	%
Reserves to NPLs ⁽¹⁾			499.12	%		466.11	%		494.46	%		405.56	%		425.95	%		499.12	%		425.95	%
Non-performing assets (“NPAs”) to total assets			0.13	%		0.14	%		0.13	%		0.15	%		0.15	%		0.13	%		0.15	%
Customers Bank Capital Ratios ⁽³⁾:
Common equity Tier 1 capital to risk-weighted assets			13.7	%		12.97	%		11.96	%		11.31	%		11.21	%		13.7	%		11.21	%
Tier 1 capital to risk-weighted assets			13.7	%		12.97	%		11.96	%		11.31	%		11.21	%		13.7	%		11.21	%
Total capital to risk-weighted assets			15.3	%		14.45	%		13.38	%		12.64	%		12.40	%		15.3	%		12.40	%
Tier 1 capital to average assets (leverage ratio)			8.7	%		8.25	%		8.00	%		8.09	%		8.15	%		8.7	%		8.15	%

(1) Metric is a spot balance for the last day of each quarter presented.
(2) Customers' reasons for the use of these non-GAAP measures and a detailed reconciliation between the non-GAAP measures and the comparable GAAP amounts are included at the end of this document.
(3) Regulatory capital ratios are estimated for Q4 2023 and actual for the remaining periods. In accordance with regulatory capital rules, Customers elected to apply the CECL capital transition provisions which delayed the effects of CECL on regulatory capital for two years until January 1, 2022, followed by a three-year transition period. The cumulative CECL capital transition impact as of December 31, 2021 which amounted to $61.6 million will be phased in at 25% per year beginning on January 1, 2022 through December 31, 2024. As of December 31, 2023, our regulatory capital ratios reflected 50%, or $30.8 million, benefit associated with the CECL transition provisions.

CUSTOMERS BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS - UNAUDITED
(Dollars in thousands, except per share data)															Twelve Months Ended
	Q4			Q3			Q2			Q1		Q4			December 31,
	2023			2023			2023			2023		2022			2023			2022
Interest income:
Loans and leases	$	239,453		$	271,107		$	241,745		$	244,212	$	217,471		$	996,517		$	743,949
Investment securities		51,074			54,243			48,026			47,316		42,953			200,659			119,236
Interest earning deposits		44,104			43,800			27,624			10,395		6,754			125,923			10,952
Loans held for sale		8,707			4,664			11,149			11,701		1,269			36,221			1,364
Other		2,577			2,526			1,616			1,321		1,200			8,040			9,872
Total interest income		345,915			376,340			330,160			314,945		269,647			1,367,360			885,373

Interest expense:
Deposits		150,307			145,825			136,375			143,930		124,366			576,437			226,239
FHLB advances		18,868			26,485			24,285			10,370		4,464			80,008			11,464
FRB advances		—			—			—			6,286		—			6,286			—
Subordinated debt		2,688			2,689			2,689			2,689		2,688			10,755			10,755
Other borrowings		1,546			1,568			1,540			1,771		2,992			6,425			13,195
Total interest expense		173,409			176,567			164,889			165,046		134,510			679,911			261,653
Net interest income		172,506			199,773			165,271			149,899		135,137			687,449			623,720
Provision for credit losses		13,523			17,856			23,629			19,603		28,216			74,611			60,066
Net interest income after provision for credit losses		158,983			181,917			141,642			130,296		106,921			612,838			563,654

Non-interest income:
Commercial lease income		9,035			8,901			8,917			9,326		8,135			36,179			27,719
Loan fees		5,926			6,029			4,271			3,990		4,017			20,216			12,188
Bank-owned life insurance		2,160			1,973			4,997			2,647		1,975			11,777			15,697
Mortgage warehouse transactional fees		927			1,018			1,376			1,074		1,295			4,395			6,738
Gain (loss) on sale of SBA and other loans		(91	)		(348	)		(761	)		—		—			(1,200	)		3,155
Loss on sale of capital call lines of credit		—			—			(5,037	)		—		—			(5,037	)		—
Loss on sale of consumer installment loans		—			—			—			—		—			—			(23,465	)
Net gain (loss) on sale of investment securities		(145	)		(429	)		—			—		(16,937	)		(574	)		(23,164	)
Legal settlement gain		—			—			—			—		7,519			—			7,519
Other		860			631			2,234			1,084		1,341			4,809			5,885
Total non-interest income		18,672			17,775			15,997			18,121		7,345			70,565			32,272

Non-interest expense:
Salaries and employee benefits		33,965			33,845			33,120			32,345		29,194			133,275			112,365
Technology, communication and bank operations		16,887			15,667			16,407			16,589		18,604			65,550			84,998
Commercial lease depreciation		7,357			7,338			7,328			7,875		6,518			29,898			22,978
Professional services		9,820			8,569			9,192			7,596		6,825			35,177			27,465
Loan servicing		3,779			3,858			4,777			4,661		4,460			17,075			15,023
Occupancy		2,320			2,471			2,519			2,760		3,672			10,070			13,606
FDIC assessments, non-income taxes and regulatory fees		13,977			8,551			9,780			2,728		2,339			35,036			8,869
Advertising and promotion		850			650			546			1,049		1,111			3,095			2,541
Legal settlement expense		—			4,096			—			—		—			4,096			—
Other		4,812			4,421			5,628			4,530		5,696			19,391			16,784
Total non-interest expense		93,767			89,466			89,297			80,133		78,419			352,663			304,629
Income before income tax expense		83,888			110,226			68,342			68,284		35,847			330,740			291,297
Income tax expense		21,796			23,470			20,768			14,563		7,136			80,597			63,263
Net income		62,092			86,756			47,574			53,721		28,711			250,143			228,034
Preferred stock dividends		3,869			3,803			3,567			3,456		3,088			14,695			9,632
Net income available to common shareholders	$	58,223		$	82,953		$	44,007		$	50,265	$	25,623		$	235,448		$	218,402

Basic earnings per common share	$	1.86		$	2.65		$	1.41		$	1.58	$	0.79		$	7.49		$	6.69
Diluted earnings per common share		1.79			2.58			1.39			1.55		0.77			7.32			6.51

CUSTOMERS BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET - UNAUDITED
(Dollars in thousands)
	December 31,			September 30,			June 30,			March 31,			December 31,
		2023			2023			2023			2023			2022
ASSETS
Cash and due from banks	$	45,210		$	68,288		$	54,127		$	77,251		$	58,025
Interest earning deposits		3,801,136			3,351,686			3,101,097			1,969,434			397,781
Cash and cash equivalents		3,846,346			3,419,974			3,155,224			2,046,685			455,806
Investment securities, at fair value		2,405,640			2,773,207			2,824,638			2,926,969			2,987,500
Investment securities held to maturity		1,103,170			1,178,370			1,258,560			870,294			840,259
Loans held for sale		340,317			150,368			78,108			424,057			328,312
Loans receivable, mortgage warehouse, at fair value		897,912			962,566			1,006,268			1,247,367			1,323,312
Loans receivable, PPP		74,735			137,063			188,763			246,258			998,153
Loans and leases receivable		11,889,120			12,463,485			12,637,768			13,145,352			13,144,894
Allowance for credit losses on loans and leases		(135,311	)		(139,213	)		(139,656	)		(130,281	)		(130,924	)
Total loans and leases receivable, net of allowance for credit losses on loans and leases		12,726,456			13,423,901			13,693,143			14,508,696			15,335,435
FHLB, Federal Reserve Bank, and other restricted stock		109,548			126,098			126,240			124,733			74,196
Accrued interest receivable		114,766			123,984			119,501			123,754			123,374
Bank premises and equipment, net		7,371			7,789			8,031			8,581			9,025
Bank-owned life insurance		292,193			291,670			290,322			339,607			338,441
Goodwill and other intangibles		3,629			3,629			3,629			3,629			3,629
Other assets		366,829			358,162			471,169			374,609			400,135
Total assets	$	21,316,265		$	21,857,152		$	22,028,565		$	21,751,614		$	20,896,112

LIABILITIES AND SHAREHOLDERS’ EQUITY
Demand, non-interest bearing deposits	$	4,422,494		$	4,758,682		$	4,490,198		$	3,487,517		$	1,885,045
Interest bearing deposits		13,497,742			13,436,682			13,460,233			14,236,100			16,271,908
Total deposits		17,920,236			18,195,364			17,950,431			17,723,617			18,156,953
FHLB advances		1,203,207			1,529,839			2,046,142			2,052,143			800,000
Other borrowings		123,840			123,775			123,710			123,645			123,580
Subordinated debt		182,230			182,161			182,091			182,021			181,952
Accrued interest payable and other liabilities		248,358			264,406			269,539			249,168			230,666
Total liabilities		19,677,871			20,295,545			20,571,913			20,330,594			19,493,151

Preferred stock		137,794			137,794			137,794			137,794			137,794
Common stock		35,459			35,330			35,301			35,258			35,012
Additional paid in capital		564,538			559,346			555,737			552,255			551,721
Retained earnings		1,159,582			1,101,359			1,018,406			974,399			924,134
Accumulated other comprehensive income (loss), net		(136,569	)		(149,812	)		(168,176	)		(156,276	)		(163,096	)
Treasury stock, at cost		(122,410	)		(122,410	)		(122,410	)		(122,410	)		(82,604	)
Total shareholders’ equity		1,638,394			1,561,607			1,456,652			1,421,020			1,402,961
Total liabilities and shareholders’ equity	$	21,316,265		$	21,857,152		$	22,028,565		$	21,751,614		$	20,896,112

CUSTOMERS BANCORP, INC. AND SUBSIDIARIES
AVERAGE BALANCE SHEET / NET INTEREST MARGIN - UNAUDITED
(Dollars in thousands)
	Three Months Ended
	December 31, 2023						September 30, 2023						December 31, 2022
	Average Balance		Interest Income or Expense		Average Yield or Cost (%)		Average Balance		Interest Income or Expense		Average Yield or Cost (%)		Average Balance		Interest Income or Expense		Average Yield or Cost (%)
Assets
Interest earning deposits	$	3,191,677	$	44,104	5.48	%	$	3,211,753	$	43,800	5.41	%	$	693,563	$	6,754	3.86	%
Investment securities ⁽¹⁾		4,007,418		51,074	5.10	%		4,240,116		54,243	5.12	%		4,061,555		42,953	4.23	%
Loans and leases:
Commercial & industrial:
Specialty lending loans and leases ⁽²⁾		5,574,149		130,838	9.31	%		5,717,252		157,671	10.94	%		5,529,567		90,885	6.52	%
Other commercial & industrial loans ⁽²⁾		1,550,201		27,214	6.96	%		1,613,614		28,012	6.89	%		1,670,000		22,796	5.42	%
Commercial loans to mortgage companies		997,353		13,726	5.46	%		1,159,698		16,916	5.79	%		1,376,760		17,701	5.10	%
Multifamily loans		2,131,750		22,347	4.16	%		2,141,384		21,292	3.94	%		2,235,885		22,481	3.99	%
Loans receivable, PPP		115,851		839	2.87	%		166,164		604	1.44	%		1,065,919		7,249	2.70	%
Non-owner occupied commercial real estate loans		1,392,684		20,686	5.89	%		1,425,831		21,208	5.90	%		1,430,420		18,536	5.14	%
Residential mortgages		526,422		5,942	4.48	%		528,022		5,965	4.48	%		524,344		5,462	4.13	%
Installment loans		1,198,043		26,568	8.80	%		1,147,069		24,103	8.34	%		1,555,108		33,630	8.58	%
Total loans and leases ⁽³⁾		13,486,453		248,160	7.30	%		13,899,034		275,771	7.87	%		15,388,003		218,740	5.64	%
Other interest-earning assets		116,756		2,577	8.75	%		134,416		2,526	7.45	%		67,907		1,200	7.01	%
Total interest-earning assets		20,802,304		345,915	6.61	%		21,485,319		376,340	6.96	%		20,211,028		269,647	5.30	%
Non-interest-earning assets		449,969						492,691						506,334
Total assets	$	21,252,273					$	21,978,010					$	20,717,362
Liabilities
Interest checking accounts	$	5,656,212	$	62,041	4.35	%	$	5,758,215	$	58,637	4.04	%	$	8,536,962	$	70,041	3.26	%
Money market deposit accounts		2,802,309		29,990	4.25	%		2,181,184		22,983	4.18	%		3,094,206		21,220	2.72	%
Other savings accounts		1,218,118		13,849	4.51	%		1,077,298		11,582	4.27	%		669,466		3,368	2.00	%
Certificates of deposit		3,625,311		44,427	4.86	%		4,466,522		52,623	4.67	%		3,259,801		29,737	3.62	%
Total interest-bearing deposits ⁽⁴⁾		13,301,950		150,307	4.48	%		13,483,219		145,825	4.29	%		15,560,435		124,366	3.17	%
Federal funds purchased		—		—	—	%		—		—	—	%		151,467		1,437	3.76	%
Borrowings		1,816,047		23,102	5.05	%		2,328,955		30,742	5.24	%		819,032		8,707	4.22	%
Total interest-bearing liabilities		15,117,997		173,409	4.55	%		15,812,174		176,567	4.43	%		16,530,934		134,510	3.23	%
Non-interest-bearing deposits ⁽⁴⁾		4,270,557						4,347,977						2,514,316
Total deposits and borrowings		19,388,554			3.55	%		20,160,151			3.48	%		19,045,250			2.80	%
Other non-interest-bearing liabilities		276,198						306,822						271,129
Total liabilities		19,664,752						20,466,973						19,316,379
Shareholders’ equity		1,587,521						1,511,037						1,400,983
Total liabilities and shareholders’ equity	$	21,252,273					$	21,978,010					$	20,717,362
Net interest income				172,506						199,773						135,137
Tax-equivalent adjustment				398						405						342
Net interest earnings			$	172,904					$	200,178					$	135,479
Interest spread					3.06	%					3.48	%					2.50	%
Net interest margin					3.30	%					3.70	%					2.66	%
Net interest margin tax equivalent					3.31	%					3.70	%					2.67	%
Net interest margin tax equivalent excl. PPP ⁽⁵⁾					3.33	%					3.75	%					2.87	%

(1) For presentation in this table, average balances and the corresponding average yields for investment securities are based upon historical cost, adjusted for amortization of premiums and accretion of discounts.
(2) Includes owner occupied commercial real estate loans.
(3) Includes non-accrual loans, the effect of which is to reduce the yield earned on loans and leases, and deferred loan fees.
(4) Total costs of deposits (including interest bearing and non-interest bearing) were 3.39%, 3.24% and 2.73% for the three months ended December 31, 2023, September 30, 2023 and December 31, 2022, respectively.
(5) Non-GAAP tax-equivalent basis, using an estimated marginal tax rate of 26% for the three months ended December 31, 2023, September 30, 2023 and December 31, 2022, presented to approximate interest income as a taxable asset and excluding net interest income from PPP loans and related borrowings, along with the related PPP loan balances and PPP fees receivable from interest-earning assets. Management uses non-GAAP measures to present historical periods comparable to the current period presentation. In addition, management believes the use of these non-GAAP measures provides additional clarity when assessing Customers’ financial results. These disclosures should not be viewed as substitutes for results determined to be in accordance with U.S. GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other entities.

CUSTOMERS BANCORP, INC. AND SUBSIDIARIES
AVERAGE BALANCE SHEET / NET INTEREST MARGIN - UNAUDITED (CONTINUED)
(Dollars in thousands)
	Twelve Months Ended
	December 31, 2023						December 31, 2022
	Average Balance		Interest Income or Expense		Average Yield or Cost (%)		Average Balance		Interest Income or Expense		Average Yield or Cost (%)
Assets
Interest earning deposits	$	2,375,488	$	125,923	5.30	%	$	620,071	$	10,952	1.77	%
Investment securities ⁽¹⁾		4,057,564		200,659	4.95	%		3,992,934		119,236	2.99	%
Loans and leases:
Commercial & industrial:
Specialty lending loans and leases ⁽²⁾		5,704,220		513,976	9.01	%		4,357,995		218,189	5.01	%
Other commercial & industrial loans ⁽²⁾		1,634,937		106,824	6.53	%		1,540,435		69,564	4.52	%
Commercial loans to mortgage companies		1,179,141		67,660	5.74	%		1,682,471		64,413	3.83	%
Multifamily loans		2,165,067		85,204	3.94	%		1,957,672		73,987	3.78	%
Loans receivable, PPP		341,987		26,627	7.79	%		1,724,659		79,381	4.60	%
Non-owner occupied commercial real estate loans		1,423,929		81,970	5.76	%		1,356,086		59,087	4.36	%
Residential mortgages		533,213		23,240	4.36	%		492,870		19,048	3.86	%
Installment loans		1,437,078		127,237	8.85	%		1,798,977		161,644	8.99	%
Total loans and leases ⁽³⁾		14,419,572		1,032,738	7.16	%		14,911,165		745,313	5.00	%
Other interest-earning assets		118,574		8,040	6.78	%		64,204		9,872	NM ⁽⁶⁾
Total interest-earning assets		20,971,198		1,367,360	6.52	%		19,588,374		885,373	4.52	%
Non-interest-earning assets		515,185						521,370
Total assets	$	21,486,383					$	20,109,744
Liabilities
Interest checking accounts	$	6,048,797	$	241,025	3.98	%	$	6,853,533	$	125,100	1.83	%
Money market deposit accounts		2,358,437		93,434	3.96	%		4,615,574		57,765	1.25	%
Other savings accounts		1,029,951		41,556	4.03	%		716,838		6,727	0.94	%
Certificates of deposit		4,401,855		200,422	4.55	%		1,352,787		36,647	2.71	%
Total interest-bearing deposits ⁽⁴⁾		13,839,040		576,437	4.17	%		13,538,732		226,239	1.67	%
Federal funds purchased		3,781		188	4.97	%		349,581		5,811	1.66	%
Borrowings		2,073,553		103,286	4.98	%		792,563		29,603	3.74	%
Total interest-bearing liabilities		15,916,374		679,911	4.27	%		14,680,876		261,653	1.78	%
Non-interest-bearing deposits ⁽⁴⁾		3,801,053						3,780,185
Total deposits and borrowings		19,717,427			3.45	%		18,461,061			1.42	%
Other non-interest-bearing liabilities		272,599						255,911
Total liabilities		19,990,026						18,716,972
Shareholders’ equity		1,496,357						1,392,772
Total liabilities and shareholders’ equity	$	21,486,383					$	20,109,744
Net interest income				687,449						623,720
Tax-equivalent adjustment				1,568						1,185
Net interest earnings			$	689,017					$	624,905
Interest spread					3.07	%					3.10	%
Net interest margin					3.28	%					3.18	%
Net interest margin tax equivalent					3.29	%					3.19	%
Net interest margin tax equivalent excl. PPP ⁽⁵⁾					3.28	%					3.16	%


(1) For presentation in this table, average balances and the corresponding average yields for investment securities are based upon historical cost, adjusted for amortization of premiums and accretion of discounts.
(2) Includes owner occupied commercial real estate loans.
(3) Includes non-accrual loans, the effect of which is to reduce the yield earned on loans and leases, and deferred loan fees.
(4) Total costs of deposits (including interest bearing and non-interest bearing) were 3.27% and 1.31% for the twelve months ended December 31, 2023 and 2022, respectively.
(5) Non-GAAP tax-equivalent basis, using an estimated marginal tax rate of 26% for the twelve months ended December 31, 2023 and 2022, presented to approximate interest income as a taxable asset and excluding net interest income from PPP loans and related borrowings, along with the related PPP loan balances and PPP fees receivable from interest-earning assets. Management uses non-GAAP measures to present historical periods comparable to the current period presentation. In addition, management believes the use of these non-GAAP measures provides additional clarity when assessing Customers’ financial results. These disclosures should not be viewed as substitutes for results determined to be in accordance with U.S. GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other entities.
(6) Not meaningful.

CUSTOMERS BANCORP, INC. AND SUBSIDIARIES
PERIOD END LOAN AND LEASE COMPOSITION - UNAUDITED
(Dollars in thousands)
	December 31,		September 30,		June 30,		March 31,		December 31,
	2023		2023		2023		2023		2022
Loans and leases held for investment
Commercial:
Commercial & industrial:
Specialty lending	$	5,006,693	$	5,422,161	$	5,534,832	$	5,519,176	$	5,412,887
Other commercial & industrial		1,087,582		1,115,364		1,052,145		1,168,161		1,135,336
Loans to mortgage companies		1,014,742		1,042,549		1,108,598		1,374,894		1,447,919
Multifamily		2,138,622		2,130,213		2,151,734		2,195,211		2,213,019
Commercial real estate owner occupied		797,319		794,815		842,042		895,314		885,339
Loans receivable, PPP		74,735		137,063		188,763		246,258		998,153
Commercial real estate non-owner occupied		1,177,650		1,178,203		1,211,091		1,245,248		1,290,730
Construction		166,393		252,588		212,214		188,123		162,009
Total commercial loans and leases		11,463,736		12,072,956		12,301,419		12,832,385		13,545,392
Consumer:
Residential		484,435		483,133		487,199		494,815		497,952
Manufactured housing		38,670		40,129		41,664		43,272		45,076
Installment:
Personal		555,533		629,843		752,470		849,420		964,641
Other		319,393		337,053		250,047		419,085		413,298
Total installment loans		874,926		966,896		1,002,517		1,268,505		1,377,939
Total consumer loans		1,398,031		1,490,158		1,531,380		1,806,592		1,920,967
Total loans and leases held for investment	$	12,861,767	$	13,563,114	$	13,832,799	$	14,638,977	$	15,466,359

Loans held for sale
Commercial:
Multifamily	$	—	$	—	$	—	$	4,051	$	4,079
Commercial real estate non-owner occupied		—		—		—		16,000		—
Total commercial loans and leases		—		—		—		20,051		4,079
Consumer:
Residential		1,215		1,005		1,234		821		829
Installment:
Personal		151,040		124,848		76,874		307,336		133,801
Other		188,062		24,515		—		95,849		189,603
Total installment loans		339,102		149,363		76,874		403,185		323,404
Total consumer loans		340,317		150,368		78,108		404,006		324,233
Total loans held for sale	$	340,317	$	150,368	$	78,108	$	424,057	$	328,312

Total loans and leases portfolio	$	13,202,084	$	13,713,482	$	13,910,907	$	15,063,034	$	15,794,671

CUSTOMERS BANCORP, INC. AND SUBSIDIARIES
PERIOD END DEPOSIT COMPOSITION - UNAUDITED
(Dollars in thousands)
	December 31,		September 30,		June 30,		March 31,		December 31,
	2023		2023		2023		2023		2022

Demand, non-interest bearing	$	4,422,494	$	4,758,682	$	4,490,198	$	3,487,517	$	1,885,045
Demand, interest bearing		5,580,527		5,824,410		5,551,037		5,791,302		8,476,027
Total demand deposits		10,003,021		10,583,092		10,041,235		9,278,819		10,361,072
Savings		1,402,941		1,118,353		1,048,229		924,359		811,798
Money market		3,226,395		2,499,593		2,004,264		2,019,633		2,734,217
Time deposits		3,287,879		3,994,326		4,856,703		5,500,806		4,249,866
Total deposits	$	17,920,236	$	18,195,364	$	17,950,431	$	17,723,617	$	18,156,953

CUSTOMERS BANCORP, INC. AND SUBSIDIARIES
ASSET QUALITY - UNAUDITED
(Dollars in thousands)	As of December 31, 2023										As of September 30, 2023										As of December 31, 2022
	Total loans		Non accrual /NPLs		Allowance for credit losses		Total NPLs to total loans		Total reserves to total NPLs		Total loans		Non accrual /NPLs		Allowance for credit losses		Total NPLs to total loans		Total reserves to total NPLs		Total loans		Non accrual /NPLs		Allowance for credit losses		Total NPLs to total loans		Total reserves to total NPLs
	Total loans		Non accrual /NPLs		Allowance for credit losses		Total NPLs to total loans		Total reserves to total NPLs		Total loans		Non accrual /NPLs		Allowance for credit losses		Total NPLs to total loans		Total reserves to total NPLs		Total loans		Non accrual /NPLs		Allowance for credit losses		Total NPLs to total loans		Total reserves to total NPLs
Loan type
Commercial & industrial, including specialty lending ⁽¹⁾	$	6,211,105	$	4,436	$	23,503	0.07	%	529.82	%	$	6,617,508	$	5,767	$	24,986	0.09	%	433.26	%	$	6,672,830	$	1,761	$	17,582	0.03	%	998.41	%
Multifamily		2,138,622		—		16,343	—	%	—	%		2,130,213		—		15,870	—	%	—	%		2,213,019		1,143		14,541	0.05	%	1272.18	%
Commercial real estate owner occupied		797,319		5,869		9,882	0.74	%	168.38	%		794,815		7,442		10,363	0.94	%	139.25	%		885,339		2,768		6,454	0.31	%	233.16	%
Commercial real estate non-owner occupied		1,177,650		—		16,859	—	%	—	%		1,178,203		—		15,819	—	%	—	%		1,290,730		—		11,219	—	%	—	%
Construction		166,393		—		1,482	—	%	—	%		252,588		—		3,130	—	%	—	%		162,009		—		1,913	—	%	—	%
*Total commercial loans and leases receivable*		10,491,089		10,305		68,069	0.10	%	660.54	%		10,973,327		13,209		70,168	0.12	%	531.21	%		11,223,927		5,672		51,709	0.05	%	911.65	%
Residential		484,435		6,802		6,586	1.40	%	96.82	%		483,133		6,559		6,802	1.36	%	103.70	%		497,952		6,922		6,094	1.39	%	88.04	%
Manufactured housing		38,670		2,331		4,239	6.03	%	181.85	%		40,129		2,582		4,080	6.43	%	158.02	%		45,076		2,410		4,430	5.35	%	183.82	%
Installment		874,926		7,211		56,417	0.82	%	782.37	%		966,896		7,299		58,163	0.75	%	796.86	%		1,377,939		9,527		68,691	0.69	%	721.01	%
*Total consumer loans receivable*		1,398,031		16,344		67,242	1.17	%	411.42	%		1,490,158		16,440		69,045	1.10	%	419.98	%		1,920,967		18,859		79,215	0.98	%	420.04	%
*Loans and leases receivable ⁽¹⁾*		11,889,120		26,649		135,311	0.22	%	507.75	%		12,463,485		29,649		139,213	0.24	%	469.54	%		13,144,894		24,531		130,924	0.19	%	533.71	%
*Loans receivable, PPP*		74,735		—		—	—	%	—	%		137,063		—		—	—	%	—	%		998,153		—		—	—	%	—	%
*Loans receivable, mortgage warehouse, at fair value*		897,912		—		—	—	%	—	%		962,566		—		—	—	%	—	%		1,323,312		—		—	—	%	—	%
*Total loans held for sale*		340,317		461		—	0.14	%	—	%		150,368		218		—	0.14	%	—	%		328,312		6,206		—	1.89	%	—	%
*Total portfolio*	$	13,202,084	$	27,110	$	135,311	0.21	%	499.12	%	$	13,713,482	$	29,867	$	139,213	0.22	%	466.11	%	$	15,794,671	$	30,737	$	130,924	0.19	%	425.95	%

(1) Excluding loans receivable, PPP from total loans and leases receivable is a non-GAAP measure. Management believes the use of these non-GAAP measures provides additional clarity when assessing Customers’ financial results. These disclosures should not be viewed as substitutes for results determined to be in accordance with U.S. GAAP, nor are they necessarily comparable to non-GAAP performance measures that may be presented by other entities. Please refer to the reconciliation schedules that follow this table.

CUSTOMERS BANCORP, INC. AND SUBSIDIARIES
NET CHARGE-OFFS/(RECOVERIES) - UNAUDITED
(Dollars in thousands)
	Q4			Q3		Q2			Q1			Q4			Twelve Months Ended December 31,
		2023			2023		2023 ⁽¹⁾			2023			2022			2023			2022
*Loan type*
Commercial & industrial, including specialty lending	$	5,282		$	2,974	$	258		$	(71	)	$	12,960		$	8,443		$	15,066
Multifamily		127			1,999		1,448			—			—			3,574			1,653
Commercial real estate owner occupied		—			39		(34	)		—			(2	)		5			(51	)
Commercial real estate non-owner occupied		(288	)		—		266			4,234			972			4,212			5,954
Construction		—			—		—			(116	)		(10	)		(116	)		(236	)
Residential		(1	)		13		24			(2	)		7			34			(47	)
Installment		12,202			12,473		13,602			14,606			13,237			52,883			44,029
Total net charge-offs (recoveries) from loans held for investment	$	17,322		$	17,498	$	15,564		$	18,651		$	27,164		$	69,035		$	66,368

(1) Excludes $6.2 million of charge-offs for certain PCD loans acquired from the FDIC that were immediately applied against $8.7 million of allowance for credit losses on PCD loans recognized upon the acquisition of the loan portfolio on June 15, 2023. Subsequent recoveries and charge-offs of these PCD loans will be included in the period in which they occur.

CUSTOMERS BANCORP, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP MEASURES - UNAUDITED

We believe that the non-GAAP measurements disclosed within this document are useful for investors, regulators, management and others to evaluate our core results of operations and financial condition relative to other financial institutions. These non-GAAP financial measures are frequently used by securities analysts, investors, and other interested parties in the evaluation of companies in our industry. These non-GAAP financial measures exclude from corresponding GAAP measures the impact of certain elements that we do not believe are representative of our ongoing financial results, which we believe enhance an overall understanding of our performance and increases comparability of our period to period results. Investors should consider our performance and financial condition as reported under GAAP and all other relevant information when assessing our performance or financial condition. The non-GAAP measures presented are not necessarily comparable to non-GAAP measures that may be presented by other financial institutions. Although non-GAAP financial measures are frequently used in the evaluation of a company, they have limitations as analytical tools and should not be considered in isolation or as a substitute for analysis of our results of operations or financial condition as reported under GAAP.

The following tables present reconciliations of GAAP to non-GAAP measures disclosed within this document.

*Core Earnings - Customers Bancorp*																									Twelve Months Ended December 31,
*Core Earnings - Customers Bancorp*	Q4 2023					Q3 2023					Q2 2023					Q1 2023					Q4 2022				2023				2022
(Dollars in thousands, except per share data)	USD			Per share		USD			Per share		USD			Per share		USD			Per share		USD		Per share		USD		Per share		USD			Per share
GAAP net income to common shareholders	$	58,223		$	1.79	$	82,953		$	2.58	$	44,007		$	1.39	$	50,265		$	1.55	$	25,623	$	0.77	$	235,448	$	7.32	$	218,402		$	6.51
Reconciling items (after tax):
Severance expense		473			0.01		—			—		141			0.00		637			0.02		—		—		1,251		0.04		1,058			0.03
Impairments on fixed assets and leases		—			—		—			—		12			0.00		86			0.00		—		—		98		0.00		1,051			0.03
Loss on sale of consumer installment loans		—			—		—			—		—			—		—			—		—		—		—		—		18,221			0.54
Loss on sale of capital call lines of credit		—			—		—			—		3,914			0.12		—			—		—		—		3,914		0.12		—			—
(Gains) losses on investment securities		(85	)		0.00		492			0.02		49			0.00		(49	)		0.00		13,543		0.41		407		0.01		18,926			0.56
Derivative credit valuation adjustment		267			0.01		(151	)		0.00		(101	)		0.00		204			0.01		202		0.01		219		0.01		(1,243	)		(0.04	)
Tax on surrender of bank-owned life insurance policies		—			—		—			—		4,141			0.13		—			—		—		—		4,141		0.13		—			—
FDIC special assessment		2,755			0.08		—			—		—			—		—			—		—		—		2,755		0.09		—			—
Core earnings	$	61,633		$	1.90	$	83,294		$	2.59	$	52,163		$	1.65	$	51,143		$	1.58	$	39,368	$	1.19	$	248,233	$	7.72	$	256,415		$	7.63

*Core Earnings, excluding PPP - Customers Bancorp*																														Twelve Months Ended December 31,
*Core Earnings, excluding PPP - Customers Bancorp*	Q4 2023						Q3 2023						Q2 2023						Q1 2023					Q4 2022						2023						2022
(Dollars in thousands, except per share data)	USD			Per share			USD			Per share			USD			Per share			USD			Per share		USD			Per share			USD			Per share			USD			Per share
GAAP net income to common shareholders	$	58,223		$	1.79		$	82,953		$	2.58		$	44,007		$	1.39		$	50,265		$	1.55	$	25,623		$	0.77		$	235,448		$	7.32		$	218,402		$	6.51
Less: PPP net income (loss) (after tax)		(5,264	)		(0.16	)		(11,168	)		(0.35	)		(2,068	)		(0.07	)		9,606			0.30		(5,956	)		(0.18	)		(8,894	)		(0.28	)		37,669			1.12
Net income to common shareholders, excluding PPP		63,487			1.95			94,121			2.93			46,075			1.46			40,659			1.26		31,579			0.95			244,342			7.60			180,733			5.39
Reconciling items (after tax):
Severance expense		473			0.01			—			—			141			0.00			637			0.02		—			—			1,251			0.04			1,058			0.03
Impairments on fixed assets and leases		—			—			—			—			12			0.00			86			0.00		—			—			98			0.00			1,051			0.03
Loss on sale of consumer installment loans		—			—			—			—			—			—			—			—		—			—			—			—			18,221			0.54
Loss on sale of capital call lines of credit		—			—			—			—			3,914			0.12			—			—		—			—			3,914			0.12			—			—
(Gains) losses on investment securities		(85	)		0.00			492			0.02			49			0.00			(49	)		0.00		13,543			0.41			407			0.01			18,926			0.56
Derivative credit valuation adjustment		267			0.01			(151	)		0.00			(101	)		0.00			204			0.01		202			0.01			219			0.01			(1,243	)		(0.04	)
Tax on surrender of bank-owned life insurance policies		—			—			—			—			4,141			0.13			—			—		—			—			4,141			0.13			—			—
FDIC special assessment		2,755			0.08			—			—			—			—			—			—		—			—			2,755			0.09			—			—
Core earnings, excluding PPP	$	66,897		$	2.06		$	94,462		$	2.94		$	54,231		$	1.72		$	41,537		$	1.28	$	45,324		$	1.37		$	257,127		$	7.99		$	218,746		$	6.51

*Core Return on Average Assets - Customers Bancorp*																Twelve Months Ended December 31,
(Dollars in thousands, except per share data)	Q4 2023			Q3 2023			Q2 2023			Q1 2023			Q4 2022				2023			2022
GAAP net income	$	62,092		$	86,756		$	47,574		$	53,721		$	28,711		$	250,143		$	228,034
Reconciling items (after tax):
Severance expense		473			—			141			637			—			1,251			1,058
Impairments on fixed assets and leases		—			—			12			86			—			98			1,051
Loss on sale of consumer installment loans		—			—			—			—			—			—			18,221
Loss on sale of capital call lines of credit		—			—			3,914			—			—			3,914			—
(Gains) losses on investment securities		(85	)		492			49			(49	)		13,543			407			18,926
Derivative credit valuation adjustment		267			(151	)		(101	)		204			202			219			(1,243	)
Tax on surrender of bank-owned life insurance policies		—			—			4,141			—			—			4,141			—
FDIC special assessment		2,755			—			—			—			—			2,755			—
Core net income	$	65,502		$	87,097		$	55,730		$	54,599		$	42,456		$	262,928		$	266,047

Average total assets	$	21,252,273		$	21,978,010		$	21,654,735		$	21,052,920		$	20,717,362		$	21,486,383		$	20,109,744

Core return on average assets		1.22	%		1.57	%		1.03	%		1.05	%		0.81	%		1.22	%		1.32	%

*Core Return on Average Assets, excluding PPP - Customers Bancorp*																Twelve Months Ended December 31,
(Dollars in thousands, except per share data)	Q4 2023			Q3 2023			Q2 2023			Q1 2023			Q4 2022				2023			2022
GAAP net income	$	62,092		$	86,756		$	47,574		$	53,721		$	28,711		$	250,143		$	228,034
Less: PPP net income (loss) (after tax)		(5,264	)		(11,168	)		(2,068	)		9,606			(5,956	)		(8,894	)		37,669
Net income, excluding PPP		67,356			97,924			49,642			44,115			34,667			259,037			190,365
Reconciling items (after tax):
Severance expense		473			—			141			637			—			1,251			1,058
Impairments on fixed assets and leases		—			—			12			86			—			98			1,051
Loss on sale of consumer installment loans		—			—			—			—			—			—			18,221
Loss on sale of capital call lines of credit		—			—			3,914			—			—			3,914			—
(Gains) losses on investment securities		(85	)		492			49			(49	)		13,543			407			18,926
Derivative credit valuation adjustment		267			(151	)		(101	)		204			202			219			(1,243	)
Tax on surrender of bank-owned life insurance policies		—			—			4,141			—			—			4,141			—
FDIC special assessment		2,755			—			—			—			—			2,755			—
Core net income, excluding PPP	$	70,766		$	98,265		$	57,798		$	44,993		$	48,412		$	271,822		$	228,378

Average total assets	$	21,252,273		$	21,978,010		$	21,654,735		$	21,052,920		$	20,717,362		$	21,486,383		$	20,109,744

Core return on average assets, excluding PPP		1.32	%		1.77	%		1.07	%		0.87	%		0.93	%		1.27	%		1.14	%

*Adjusted Net Income and Adjusted ROAA - Pre-Tax Pre-Provision - Customers Bancorp*																Twelve Months Ended December 31,
(Dollars in thousands, except per share data)	Q4 2023			Q3 2023			Q2 2023			Q1 2023			Q4 2022				2023			2022
GAAP net income	$	62,092		$	86,756		$	47,574		$	53,721		$	28,711		$	250,143		$	228,034
Reconciling items:
Income tax expense		21,796			23,470			20,768			14,563			7,136			80,597			63,263
Provision (benefit) for credit losses		13,523			17,856			23,629			19,603			28,216			74,611			60,066
Provision (benefit) for credit losses on unfunded commitments		(136	)		48			(304	)		280			153			(112	)		906
Severance expense		639			—			182			809			—			1,630			1,363
Impairments on fixed assets and leases		—			—			15			109			—			124			1,362
Loss on sale of consumer installment loans		—			—			—			—			—			—			23,465
Loss on sale of capital call lines of credit		—			—			5,037			—			—			5,037			—
(Gains) losses on investment securities		(114	)		626			62			(62	)		16,909			512			23,874
Derivative credit valuation adjustment		361			(192	)		(130	)		259			252			298			(1,621	)
FDIC special assessment		3,723			—			—			—			—			3,723			—
Adjusted net income - pre-tax pre-provision	$	101,884		$	128,564		$	96,833		$	89,282		$	81,377		$	416,563		$	400,712

Average total assets	$	21,252,273		$	21,978,010		$	21,654,735		$	21,052,920		$	20,717,362		$	21,486,383		$	20,109,744

Adjusted ROAA - pre-tax pre-provision		1.90	%		2.32	%		1.79	%		1.72	%		1.56	%		1.94	%		1.99	%

*Adjusted Net Income and Adjusted ROAA - Pre-Tax Pre-Provision, excluding PPP - Customers Bancorp*																Twelve Months Ended December 31,
(Dollars in thousands, except per share data)	Q4 2023			Q3 2023			Q2 2023			Q1 2023			Q4 2022				2023			2022
GAAP net income	$	62,092		$	86,756		$	47,574		$	53,721		$	28,711		$	250,143		$	228,034
Less: PPP net income (loss) (after tax)		(5,264	)		(11,168	)		(2,068	)		9,606			(5,956	)		(8,894	)		37,669
Net income, excluding PPP		67,356			97,924			49,642			44,115			34,667			259,037			190,365
Reconciling items:
Income tax expense		21,796			23,470			20,768			14,563			7,136			80,597			63,263
Provision (benefit) for credit losses		13,523			17,856			23,629			19,603			28,216			74,611			60,066
Provision (benefit) for credit losses on unfunded commitments		(136	)		48			(304	)		280			153			(112	)		906
Severance expense		639			—			182			809			—			1,630			1,363
Impairments on fixed assets and leases		—			—			15			109			—			124			1,362
Loss on sale of consumer installment loans		—			—			—			—			—			—			23,465
Loss on sale of capital call lines of credit		—			—			5,037			—			—			5,037			—
(Gains) losses on investment securities		(114	)		626			62			(62	)		16,909			512			23,874
Derivative credit valuation adjustment		361			(192	)		(130	)		259			252			298			(1,621	)
FDIC special assessment		3,723			—			—			—			—			3,723			—
Adjusted net income - pre-tax pre-provision, excluding PPP	$	107,148		$	139,732		$	98,901		$	79,676		$	87,333		$	425,457		$	363,043

Average total assets	$	21,252,273		$	21,978,010		$	21,654,735		$	21,052,920		$	20,717,362		$	21,486,383		$	20,109,744

Adjusted ROAA - pre-tax pre-provision, excluding PPP		2.00	%		2.52	%		1.83	%		1.53	%		1.67	%		1.98	%		1.81	%

*Core Return on Average Common Equity - Customers Bancorp*																Twelve Months Ended December 31,
(Dollars in thousands, except per share data)	Q4 2023			Q3 2023			Q2 2023			Q1 2023			Q4 2022				2023			2022
GAAP net income to common shareholders	$	58,223		$	82,953		$	44,007		$	50,265		$	25,623		$	235,448		$	218,402
Reconciling items (after tax):
Severance expense		473			—			141			637			—			1,251			1,058
Impairments on fixed assets and leases		—			—			12			86			—			98			1,051
Loss on sale of consumer installment loans		—			—			—			—			—			—			18,221
Loss on sale of capital call lines of credit		—			—			3,914			—			—			3,914			—
(Gains) losses on investment securities		(85	)		492			49			(49	)		13,543			407			18,926
Derivative credit valuation adjustment		267			(151	)		(101	)		204			202			219			(1,243	)
Tax on surrender of bank-owned life insurance policies		—			—			4,141			—			—			4,141			—
FDIC special assessment		2,755			—			—			—			—			2,755			—
Core earnings	$	61,633		$	83,294		$	52,163		$	51,143		$	39,368		$	248,233		$	256,415

Average total common shareholders’ equity	$	1,449,728		$	1,373,244		$	1,335,408		$	1,273,780		$	1,263,190		$	1,358,564		$	1,254,979

Core return on average common equity		16.87	%		24.06	%		15.67	%		16.28	%		12.36	%		18.27	%		20.43	%

*Adjusted ROCE - Pre-Tax Pre-Provision - Customers Bancorp*																Twelve Months Ended December 31,
(Dollars in thousands, except per share data)	Q4 2023			Q3 2023			Q2 2023			Q1 2023			Q4 2022				2023			2022
GAAP net income to common shareholders	$	58,223		$	82,953		$	44,007		$	50,265		$	25,623		$	235,448		$	218,402
Reconciling items:
Income tax expense		21,796			23,470			20,768			14,563			7,136			80,597			63,263
Provision (benefit) for credit losses		13,523			17,856			23,629			19,603			28,216			74,611			60,066
Provision (benefit) for credit losses on unfunded commitments		(136	)		48			(304	)		280			153			(112	)		906
Severance expense		639			—			182			809			—			1,630			1,363
Impairments on fixed assets and leases		—			—			15			109			—			124			1,362
Loss on sale of consumer installment loans		—			—			—			—			—			—			23,465
Loss on sale of capital call lines of credit		—			—			5,037			—			—			5,037			—
(Gains) losses on investment securities		(114	)		626			62			(62	)		16,909			512			23,874
Derivative credit valuation adjustment		361			(192	)		(130	)		259			252			298			(1,621	)
FDIC special assessment		3,723			—			—			—			—			3,723			—
Pre-tax pre-provision adjusted net income available to common shareholders	$	98,015		$	124,761		$	93,266		$	85,826		$	78,289		$	401,868		$	391,080

Average total common shareholders’ equity	$	1,449,728		$	1,373,244		$	1,335,408		$	1,273,780		$	1,263,190		$	1,358,564		$	1,254,979

Adjusted ROCE - pre-tax pre-provision		26.82	%		36.04	%		28.01	%		27.33	%		24.59	%		29.58	%		31.16	%

*Net Interest Margin, Tax Equivalent, excluding PPP - Customers Bancorp*																Twelve Months Ended December 31,
(Dollars in thousands, except per share data)	Q4 2023			Q3 2023			Q2 2023			Q1 2023			Q4 2022				2023			2022
GAAP net interest income	$	172,506		$	199,773		$	165,271		$	149,899		$	135,137		$	687,449		$	623,720
PPP net interest (income) expense		596			1,381			765			(14,106	)		2,791			(11,364	)		(60,402	)
Tax-equivalent adjustment		398			405			390			375			342			1,568			1,185
Net interest income, tax equivalent, excluding PPP	$	173,500		$	201,559		$	166,426		$	136,168		$	138,270		$	677,653		$	564,503


GAAP average total interest earning assets	$	20,802,304		$	21,485,319		$	21,073,680		$	20,514,677		$	20,211,028		$	20,971,198		$	19,588,374
Average PPP loans		(115,851	)		(166,164	)		(207,127	)		(889,235	)		(1,065,919	)		(341,987	)		(1,724,659	)
Adjusted average total interest earning assets, excluding PPP	$	20,686,453		$	21,319,155		$	20,866,553		$	19,625,442		$	19,145,109		$	20,629,211		$	17,863,715

Net interest margin, tax equivalent, excluding PPP		3.33	%		3.75	%		3.20	%		2.80	%		2.87	%		3.28	%		3.16	%

*Loan Yield, excluding PPP*																Twelve Months Ended December 31,
(Dollars in thousands except per share data)	Q4 2023			Q3 2023			Q2 2023			Q1 2023			Q4 2022				2023			2022
Interest income on loans and leases	$	248,160		$	275,771		$	252,894		$	255,913		$	218,740		$	1,032,738		$	745,313

PPP interest income		(839	)		(604	)		(1,633	)		(23,551	)		(7,249	)		(26,627	)		(79,381	)
Interest income on core loans (Loans and leases, excluding PPP)	$	247,321		$	275,167		$	251,261		$	232,362		$	211,491		$	1,006,111		$	665,932


Average total loans and leases	$	13,486,453		$	13,899,034		$	14,842,432		$	15,477,973		$	15,388,003		$	14,419,572		$	14,911,165
Average PPP loans		(115,851	)		(166,164	)		(207,127	)		(889,235	)		(1,065,919	)		(341,987	)		(1,724,659	)
Adjusted average total loans and leases	$	13,370,602		$	13,732,870		$	14,635,305		$	14,588,738		$	14,322,084		$	14,077,585		$	13,186,506

Loan yield, excluding PPP		7.34	%		7.95	%		6.89	%		6.46	%		5.86	%		7.15	%		5.05	%

*Core Efficiency Ratio - Customers Bancorp*																Twelve Months Ended December 31,
(Dollars in thousands, except per share data)	Q4 2023			Q3 2023			Q2 2023			Q1 2023			Q4 2022				2023			2022
GAAP net interest income	$	172,506		$	199,773		$	165,271		$	149,899		$	135,137		$	687,449		$	623,720

GAAP non-interest income	$	18,672		$	17,775		$	15,997		$	18,121		$	7,345		$	70,565		$	32,272
Loss on sale of consumer installment loans		—			—			—			—			—			—			23,465
Loss on sale of capital call lines of credit		—			—			5,037			—			—			5,037			—
(Gains) losses on investment securities		(114	)		626			62			(62	)		16,909			512			23,874
Derivative credit valuation adjustment		361			(192	)		(130	)		259			252			298			(1,621	)
Core non-interest income		18,919			18,209			20,966			18,318			24,506			76,412			77,990
Core revenue	$	191,425		$	217,982		$	186,237		$	168,217		$	159,643		$	763,861		$	701,710


GAAP non-interest expense	$	93,767		$	89,466		$	89,297		$	80,133		$	78,419		$	352,663		$	304,629
Severance expense		(639	)		—			(182	)		(809	)		—			(1,630	)		(1,363	)
Impairments on fixed assets and leases		—			—			(15	)		(109	)		—			(124	)		(1,362	)
FDIC special assessment		(3,723	)		—			—			—			—			(3,723	)		—
Core non-interest expense	$	89,405		$	89,466		$	89,100		$	79,215		$	78,419		$	347,186		$	301,904

Core efficiency ratio ⁽¹⁾		46.70	%		41.04	%		47.84	%		47.09	%		49.12	%		45.45	%		43.02	%

(1) Core efficiency ratio calculated as core non-interest expense divided by core revenue.

*Core non-interest expense to average total assets - Customers Bancorp*																Twelve Months Ended December 31,
(Dollars in thousands, except per share data)	Q4 2023			Q3 2023			Q2 2023			Q1 2023			Q4 2022				2023			2022
GAAP non-interest expense	$	93,767		$	89,466		$	89,297		$	80,133		$	78,419		$	352,663		$	304,629
Severance expense		(639	)		—			(182	)		(809	)		—			(1,630	)		(1,363	)
Impairments on fixed assets and leases		—			—			(15	)		(109	)		—			(124	)		(1,362	)
FDIC special assessment		(3,723	)		—			—			—			—			(3,723	)		—
Core non-interest expense	$	89,405		$	89,466		$	89,100		$	79,215		$	78,419		$	347,186		$	301,904


Average total assets	$	21,252,273		$	21,978,010		$	21,654,735		$	21,052,920		$	20,717,362		$	21,486,383		$	20,109,744

Core non-interest expense to average total assets		1.67	%		1.62	%		1.65	%		1.53	%		1.50	%		1.62	%		1.50	%

*Tangible Common Equity to Tangible Assets - Customers Bancorp*

(Dollars in thousands, except per share data)	Q4 2023			Q3 2023			Q2 2023			Q1 2023			Q4 2022
GAAP total shareholders’ equity	$	1,638,394		$	1,561,607		$	1,456,652		$	1,421,020		$	1,402,961
Reconciling items:
Preferred stock		(137,794	)		(137,794	)		(137,794	)		(137,794	)		(137,794	)
Goodwill and other intangibles		(3,629	)		(3,629	)		(3,629	)		(3,629	)		(3,629	)
Tangible common equity	$	1,496,971		$	1,420,184		$	1,315,229		$	1,279,597		$	1,261,538

GAAP total assets	$	21,316,265		$	21,857,152		$	22,028,565		$	21,751,614		$	20,896,112
Reconciling items:
Goodwill and other intangibles		(3,629	)		(3,629	)		(3,629	)		(3,629	)		(3,629	)
Tangible assets	$	21,312,636		$	21,853,523		$	22,024,936		$	21,747,985		$	20,892,483

Tangible common equity to tangible assets		7.0	%		6.5	%		6.0	%		5.9	%		6.0	%

*Tangible Common Equity to Tangible Assets, excluding PPP - Customers Bancorp*

(Dollars in thousands, except per share data)	Q4 2023			Q3 2023			Q2 2023			Q1 2023			Q4 2022
GAAP total shareholders’ equity	$	1,638,394		$	1,561,607		$	1,456,652		$	1,421,020		$	1,402,961
Reconciling items:
Preferred stock		(137,794	)		(137,794	)		(137,794	)		(137,794	)		(137,794	)
Goodwill and other intangibles		(3,629	)		(3,629	)		(3,629	)		(3,629	)		(3,629	)
Tangible common equity	$	1,496,971		$	1,420,184		$	1,315,229		$	1,279,597		$	1,261,538

GAAP total assets	$	21,316,265		$	21,857,152		$	22,028,565		$	21,751,614		$	20,896,112
Loans receivable, PPP		(74,735	)		(137,063	)		(188,763	)		(246,258	)		(998,153	)
Total assets, excluding PPP	$	21,241,530		$	21,720,089		$	21,839,802		$	21,505,356		$	19,897,959
Reconciling items:
Goodwill and other intangibles		(3,629	)		(3,629	)		(3,629	)		(3,629	)		(3,629	)
Tangible assets, excluding PPP	$	21,237,901		$	21,716,460		$	21,836,173		$	21,501,727		$	19,894,330

Tangible common equity to tangible assets, excluding PPP		7.0	%		6.5	%		6.0	%		6.0	%		6.3	%

*Tangible Book Value per Common Share - Customers Bancorp*

(Dollars in thousands, except share and per share data)	Q4 2023			Q3 2023			Q2 2023			Q1 2023			Q4 2022
GAAP total shareholders’ equity	$	1,638,394		$	1,561,607		$	1,456,652		$	1,421,020		$	1,402,961
Reconciling Items:
Preferred stock		(137,794	)		(137,794	)		(137,794	)		(137,794	)		(137,794	)
Goodwill and other intangibles		(3,629	)		(3,629	)		(3,629	)		(3,629	)		(3,629	)
Tangible common equity	$	1,496,971		$	1,420,184		$	1,315,229		$	1,279,597		$	1,261,538

Common shares outstanding		31,440,906			31,311,254			31,282,318			31,239,750			32,373,697

Tangible book value per common share	$	47.61		$	45.36		$	42.04		$	40.96		$	38.97

*Tangible Book Value per Common Share - Customers Bancorp*

(Dollars in thousands, except share and per share data)	Q4 2023			Q4 2022			Q4 2021			Q4 2020			Q4 2019			Q4 2018
GAAP total shareholders’ equity	$	1,638,394		$	1,402,961		$	1,366,217		$	1,117,086		$	1,052,795		$	956,816
Reconciling Items:
Preferred stock		(137,794	)		(137,794	)		(137,794	)		(217,471	)		(217,471	)		(217,471	)
Goodwill and other intangibles		(3,629	)		(3,629	)		(3,736	)		(14,298	)		(15,195	)		(16,499	)
Tangible common equity	$	1,496,971		$	1,261,538		$	1,224,687		$	885,317		$	820,129		$	722,846

Common shares outstanding		31,440,906			32,373,697			32,913,267			31,705,088			31,336,791			31,003,028

Tangible book value per common share	$	47.61		$	38.97		$	37.21		$	27.92		$	26.17		$	23.32

*Core Loans (Total Loans and Leases, excluding PPP)*

(Dollars in thousands, except per share data)	Q4 2023			Q3 2023			Q2 2023			Q1 2023			Q4 2022
Total loans and leases	$	13,202,084		$	13,713,482		$	13,910,907		$	15,063,034		$	15,794,671

Loans receivable, PPP		(74,735	)		(137,063	)		(188,763	)		(246,258	)		(998,153	)
Core Loans (Total loans and leases, excluding PPP)	$	13,127,349		$	13,576,419		$	13,722,144		$	14,816,776		$	14,796,518


*Core Loans Held for Investment* *(Total Loans and Leases Held for Investment, excluding PPP)*

(Dollars in thousands, except per share data)	Q4 2023			Q3 2023			Q2 2023			Q1 2023			Q4 2022
Total loans and leases, held for investment	$	12,861,767		$	13,563,114		$	13,832,799		$	14,638,977		$	15,466,359

Loans receivable, PPP		(74,735	)		(137,063	)		(188,763	)		(246,258	)		(998,153	)
Core Loans Held for Investment (Total loans and leases held for investment, excluding PPP)	$	12,787,032		$	13,426,051		$	13,644,036		$	14,392,719		$	14,468,206

*Total Assets, excluding PPP*

(Dollars in thousands, except per share data)	Q4 2023			Q3 2023			Q2 2023			Q1 2023			Q4 2022
Total assets	$	21,316,265		$	21,857,152		$	22,028,565		$	21,751,614		$	20,896,112

Loans receivable, PPP		(74,735	)		(137,063	)		(188,763	)		(246,258	)		(998,153	)
Total assets, excluding PPP	$	21,241,530		$	21,720,089		$	21,839,802		$	21,505,356		$	19,897,959

*Coverage of credit loss reserves for loans and leases held for investment, excluding PPP*

(Dollars in thousands, except per share data)	Q4 2023			Q3 2023			Q2 2023			Q1 2023			Q4 2022
Loans and leases receivable	$	11,963,855		$	12,600,548		$	12,826,531		$	13,391,610		$	14,143,047

Loans receivable, PPP		(74,735	)		(137,063	)		(188,763	)		(246,258	)		(998,153	)
Loans and leases held for investment, excluding PPP	$	11,889,120		$	12,463,485		$	12,637,768		$	13,145,352		$	13,144,894

Allowance for credit losses on loans and leases	$	135,311		$	139,213		$	139,656		$	130,281		$	130,924

Coverage of credit loss reserves for loans and leases held for investment, excluding PPP		1.14	%		1.12	%		1.11	%		0.99	%		1.00	%

View source version on businesswire.com: https://www.businesswire.com/news/home/20240124366139/en/

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