Heartland Q4 2020 Earnings

• Quarterly net income available to common stockholders of $37.8 million or $0.98 per diluted common share
• Annual net income available to common stockholders of $133.5 million or $3.57 per diluted common share
• Net interest margin of 3.51%, fully tax-equivalent (non-GAAP)⁽¹⁾ of 3.55% for the fourth quarter
• Efficiency ratio (non-GAAP)⁽¹⁾ for the fourth quarter of 2020 of 54.93% and 56.65% for the year
• Nonperforming assets as a percentage of total assets of 0.53% and net charge-offs for the quarter of $216,000
• Completed the acquisition of AimBank, Heartland's largest acquisition to date, which had assets at fair value of $1.97 billion
• Completed the purchase and assumption of substantially all of the deposits, which totaled $415.5 million, and other certain assets and liabilities of Johnson Bank's Arizona operations
• Approved a 10% increase in quarterly dividend to $.22 per share at the January 19, 2021 board meeting

Quarter Ended
December 31,

Year Ended December 31,

2020

2019

2020

2019

Net income available to common stockholders (in millions)

$

37.8

$

37.9

$

133.5

$

149.1

Diluted earnings per common share

0.98

1.03

3.57

4.14

Return on average assets

0.92

%

1.17

%

0.90

%

1.24

%

Return on average common equity

8.50

9.56

8.06

10.12

Return on average tangible common equity (non-GAAP)⁽¹⁾

12.77

14.65

12.28

15.73

Net interest margin

3.51

3.86

3.65

4.00

Net interest margin, fully tax-equivalent (non-GAAP)⁽¹⁾

3.55

3.90

3.69

4.04

Efficiency ratio, fully-tax equivalent (non-GAAP)⁽¹⁾

54.93

60.31

56.65

62.50

(1) Refer to "Non-GAAP Measures" in this earnings release for additional information on the usage and presentation of these non-GAAP measures, and refer to the financial tables for reconciliations to the most directly comparable GAAP measures.

"Heartland successfully navigated a challenging year with net income available to common stockholders of $133.5 million, or $3.57 per diluted common share. Our success was highlighted by an improved efficiency ratio of 56.65%, strong net interest margin of 3.69% and stable credit quality."

Bruce K. Lee, president and chief executive officer, Heartland Financial USA, Inc.