Welcome to the Old National Bancorp fourth quarter and full year 2021 earnings conference call. This call is being recorded and has been accessible to the public in accordance with the SEC's Regulation FD. Corresponding presentation slides can be found on the investor relations page at oldnational.com and will be archived there for 12 months. Management would like to remind everyone that certain statements on today's call may be forward-looking in nature and are subject to certain risks and uncertainties and other factors that could cause actual results to differ from those discussed. The company's risk factors are fully disclosed and discussed within the SEC filings. In addition, certain slides contain non-GAAP measures, which management believes provide more appropriate comparisons. These non-GAAP measures are intended to assist investors understanding the performance trends. Reconciliations for these numbers are contained within the appendix of the presentation. I'd now like to turn the call over to James C. Ryan III for opening remarks. Mr. Ryan. Good morning and happy New Year. We are pleased to host our call to discuss our 2021 results and update on our pending partnership with First Midwest Bancorp. Let's start on slide four. We are pleased to share our full year 2021 results. I would categorize this year's results as better than planned. 2021 EPS was $1.67. Adjusted EPS was $1.73, with an adjusted net income of more than $286 million. Our adjusted return on average tangible common equity was north of 15%, and our adjusted efficiency ratio was approximately 57%. Highlights include 7% commercial loan growth, driven by record commercial production of $3.9 billion, coupled with net recoveries of $4.8 million for the year. We also saw record wealth management revenues in 2021. I'm particularly pleased that commercial loans are now up 20% in total from 2019 levels, excluding the impact of PPP. That's significant growth amid a global pandemic, and we've maintained a consistently strong credit profile in the process. We've opportunistically leaned in when several of our competitors froze, and we continue to benefit from that stance, taking share by doing what we do best, consistent quality growth. Moving to slide five. Our fourth quarter EPS was $0.34. Adjusted EPS was $0.37. We saw strong commercial loan production of $1.1 billion during the quarter and excellent credit quality. Our pipeline ended the year at a robust $2.5 billion. A quick update on hiring. We opportunistically added significant talent during the quarter, especially on our commercial and wealth, commercial and wealth management teams. Building upon our recent success in St. Louis, we have hired two industry veterans to start an LPO in Kansas City, which should be operating at full strength later in the quarter. We've also begun recruiting talent in Chicago, anticipating that Chicago and Minneapolis will be a significant focus in 2022. In summary, our talent pipeline remains strong. I am personally active in recruiting key team members, and we will continue to make these vital investments throughout the year. Moving to slide six, which contains a quick refresher on some of our accomplishments and next steps with our partnership with First Midwest. As you know, both companies have tremendous integration history and experience. As a result, our work is going very well. We have decisioned and communicated the organizational structure and leadership positions for all client segments and support areas. We've also settled on our core processing system and supporting applications. Our team members' engagement excitement remains strong, and as a result, we've seen minimal client-facing roles, minimal attrition in our client-facing roles. Our combined leadership teams continue to meet and build a collective long-term strategy and develop tactics to accelerate our combined growth. While we're still waiting on Federal Reserve approval, we continue to have frequent and constructive dialogue with the Fed staff, who assure us our application is complete and ready for review at the board level. We expect we will hear positive news this quarter. As soon as we hear, we will move expeditiously towards the close. With a more elongated than expected regulatory approval and the global pandemic-related issues affecting the availability of labor and IT equipment, we now expect our systems conversion to occur in July. Given the delayed systems conversion, we expect to achieve closer to 50% of the run rate savings we modeled in 2022. We still expect to achieve 100% of the original modeled savings of $109 million in 2023. Lastly, despite potential distraction from the lingering pandemic-related issues and our transformational merger, we remain highly focused on serving our clients and communities. I think our results for the quarter and the year illustrate the success of those efforts. Our success would not have been possible without one of the strongest teams in the industry. I'm also grateful for the hundreds of team members who are focused on the successful integration of the combined companies. Thank you. I'll now turn the call over to Brendan. Thanks, James. Turning to slide seven. Our GAAP earnings per share was $0.34 and our adjusted earnings per share was $0.37. Adjusted earnings exclude $6.7 million in merger-related charges, as well as $400,000 in debt securities gains. Slide eight shows the trend in commercial loans and the related pipeline and production trends, all excluding the impact of PPP loans. Q4 represents our sixth consecutive quarter of organic loan growth, with 2021 commercial outstanding increasing over 7%, with both CRE and C&I showing solid growth. Strong commercial production of $1.1 billion was well balanced across all our major markets. We're also pleased that the strong fourth quarter production did not have a significant impact on our pipeline, which ended the year at $2.5 billion, the highest year-end level on record. The size and quality of the pipeline that includes almost $500 million in the accepted category supports our optimistic outlook on loan growth heading into 2022. Turning briefly to pricing, new money yields on C&I were 3.39%, which are now well above portfolio yields. New CRE production yields were slightly lower for the quarter at 2.59%. More than 80% of that production is indexed to short-term rates with good spreads but relatively low absolute coupons. While this puts some pressure on margin in the near term, it does position us well for a rising rate environment. The investment portfolio increased this quarter as deposit growth once again outpaced total loan growth. We continue to put much of the excess liquidity to work in our investment portfolio. New money yields on investments improved 18 basis points quarter over quarter to 1.8%, with portfolio duration shorter by a quarter year. Moving to slide nine, we again saw meaningful increases in both period-end and average deposit balances. Quarterly growth came largely from our retail clients, with business clients drawing down on non-interest-bearing accounts. Total cost of deposits for the quarter was 5 basis points, while total interest-bearing liabilities was 28 basis points, both down 1 basis point from Q3. Next, on slide 10, you will see details of our net interest income and margins. Net interest income excluding PPP decreased just $300,000, which was consistent with both our expectations and goal of maintaining stable NII throughout this challenging rate environment. Net interest margin decreased 15 basis points from prior quarter to 2.77%, and core margin excluding accretion and PPP declined 11 basis points to 2.59%. Excess liquidity and interest collected on non-accrual loans accounted for 6 basis points of the decline. Slide 11 shows trends in adjusted non-interest income. Adjusted non-interest income for the quarter at $51 million was $2 million lower than Q3, largely due to seasonal declines in mortgage. Our wealth line of business finished with a strong fourth quarter, which resulted in record revenue for the year. Our capital markets business had another strong quarter and finished the year just shy of last year's record revenue. Mortgage production was up slightly in the quarter, but a seasonal decline in the size of the pipeline resulted in a $3.9 million decrease in revenue. Next, slide 12 shows the trend in adjusted non-interest expenses. Adjusting for merger charges and tax credit amortization, non-interest expense was $123 million. The quarter-over-quarter increase was driven by additional lending incentives related to strong commercial and mortgage production. Additionally, increases in marketing and professional fees categories were related to investments in Minnesota marketing efforts and the establishment of a new brand for our high net worth wealth division that we discussed last quarter. Turning to PPP loans on slide 13, you will see a roll forward of those balances, which stood at just $169 million at quarter end. Unamortized fees on the remaining loans total $6.4 million. We anticipate most of the remaining loans will be forgiven in the first half of 2022 and the related fees recognized accordingly. Slide 14 shows our credit trends. Credit conditions continue to be benign and our commercial and consumer portfolios continue to perform exceptionally well. Delinquencies ticked up 1 basis point to end the quarter at a very low 11 basis points. We were pleased to post a sixth consecutive quarter in a net recovery position, resulting in full-year net recoveries of $4.8 million. The non-performing loans to total loan ratio once again hit a new cycle low at 92 basis points. While this metric remains higher than peers, the net charge-offs to NPL ratio is significantly better than peers. We believe our approach to downgrading troubled credits early and a patient approach to workout results in better outcomes for our clients and ultimately lower costs for the bank. On slide 15, you will see the details of our fourth quarter allowance, which stands at $107 million, a slight decline from Q3. Credit loss expectations showed a slight improvement quarter over quarter, but the related reserve release was largely offset by additional reserves for loan growth. While our outlook on credit remains optimistic, we believe it is still prudent to maintain above average levels of qualitative reserves, which stood at $37 million at quarter end. As a reminder, we also continue to carry $34 million in unamortized marks from our acquired portfolios. As I wrap up my comments, here are some key takeaways. We are very pleased with the fundamental results of the quarter and year. Strong commercial loan growth led to stable core net interest income despite interest rate headwinds. Our fee-based businesses led by wealth, mortgage, and capital markets continue to perform well and provide a great launching point for 2022. Expenses remain well controlled, and our strong credit quality continues to keep credit costs low. Slide 16 includes thoughts on our outlook for 2022. We ended the quarter with a healthy $2.5 billion commercial pipeline, which supports our favorable outlook on loan growth. This historically low interest rate environment will continue to put pressure on net interest income, which should be mitigated through continued earning asset growth. Rising short-term rates will have a positive impact on earnings as we have gradually repositioned the balance sheet to a more asset-sensitive position. The PPP loan forgiveness process continues for our clients. We expect runoff of most of the remaining balances and related fee recognition to occur in the first half of 2022. We expect our fee businesses to continue to perform well. We are encouraged by the momentum in our wealth business, and the strong commercial activity should help maintain the high level of performance in our capital markets business. Mortgage revenue should follow industry trends and be seasonally lower in the first quarter. Our other fee lines are expected to be stable in the near term. ONB standalone expenses are expected to rise 2%-3% in 2022 and should follow typical seasonal patterns. The estimate includes an expectation of slightly higher merit increases related to inflation and continued strategic investments in both revenue talent and technology. A brief update on taxes. We continue to expect a reduction in the volatility caused by our tax credits as we work through the last of the remaining one-year historical tax credit commitments. In total, we are expecting approximately $12 million in tax credit amortization for the year, with a corresponding ONB standalone full-year effective tax rate of approximately 17%-18%. The pro forma range for the combined company would be in the range of 21%-22%. In light of the delayed close for our merger with FNB, we want to provide an update on the combined company expense expectations. Our June 1 announcement assumed 75% of the annualized cost synergies would be realized in 2022. The first quarter close of the deal and the corresponding July conversion date is now expected to reduce the 22 impact to approximately 50% of the total synergies, with the majority realized in the second half of the year. That said, we are still confident we will realize 100% of the $109 million in targeted savings, which will help us deliver meaningful positive operating leverage. In other words, the magnitude of the saves is unchanged, but the timing is now elongated by 90 days. With that, we are happy to answer any questions that you may have, and we do have the full team here, including James A. Sandgren, Daryl D. Moore, and John Moran. Also joining us this morning is Mark G. Sander, President and COO of First Midwest Bank. Your first question comes from the line of Benjamin Gerlinger with Hovde Group. Good morning, Ben. Good morning, everyone. Good morning. I was curious if we could take a minute to talk kind of high level loan growth through the pandemic. Old National and First Midwest did a pretty solid job growing loans pretty consistently throughout the pandemic, especially when you compared it to like Fed H.8 data. When you look at the fourth quarter, Old National was a little bit lower, which makes sense. If you look over a fourth quarter run rate, you guys have done a better job. And then with the commentary about 1Q boding well for future growth, I was curious on kind of what you guys are seeing from kind of the ground level in terms of your clients, their loan demand. Typically, fourth quarter kind of pulls in from first quarter's demand, and first quarter is usually flat. I was kind of curious if you could just spend some time thinking out loud about how your clients are approaching their need for loans and what it might mean for you guys in the first half of 2022. Yeah. Ben, this is James A. Sandgren. I think you nailed it. Obviously really strong production in the fourth quarter. Pipeline's down a little bit seasonally, in the process of building those back up. I will tell you, I think from a grassroots, our clients feel really optimistic, in spite of the challenges that they continue to face around labor and supply chain. The other thing that caused a little concern in the fourth quarter was a high level of payoffs. Again, highest level that we've seen in a number of years, and I don't know if that will continue in the first quarter or not. I do think the pipeline continues to reflect that, you know, our customers are investing and growing, if they can find the labor. again, we think we'll get off to a good start, just not knowing exactly where those payoffs will continue to land. Mark, would you like to add anything from your perspective? I think it's very similar to what James said. You know, pipelines are strong. Our customers, I think are optimistic. There is still a fair amount of liquidity in the system, of course, and payoffs are elevated. But our production is good and solid and should position us well for loan growth coming right out of the box in Q1. Great. That's helpful. Brendan, if you can kind of just look at the yield curve expectations going forward. I know that you have two balance sheets coming together. You have a margin that's near or at its floor. If the market's kind of expecting three to four hikes in 2022 and beyond a couple more, I was curious if you had any idea of where the margin might shake out as we end 2022 with the two like, kind of combining everything together. Sure. Yeah, Benjamin, I think you're right. I think short of rate changes, I think we're getting close to the floor. I don't think we're all the way there yet. I think there could be some margin depression without some help from the Fed. We have looked at both balance sheets and the margin impact from rate increases. How we like to model that up then is against the forward curve. We think the ONB standalone is gonna get some upward movement to about 2%-3% in NII on a standalone basis. When we fold in FNB, which has a slightly more asset sensitive balance sheet, has a little more cash on hand, we think that's closer to 3%-4%, again, against the forward rate, which is now kind of 3.5-4 four rate hikes embedded in there. Okay, great. That's helpful. I will, I'll step back. Solid way to end the year. Thanks, Benjamin. Your next question is from Robert Scott Siefers with Piper Sandler. Good morning, Scott. Morning, guys. Thanks for taking the question. Brendan, wanted to follow on those rate sensitivity comments. Can you maybe talk a little bit about where you're most sensitive on the curve or I guess ideally, where on a pro forma basis you'll be most sensitive? You know, do you benefit the most at the beginning of the tightening cycle, or will it take a few hikes for you to feel the full benefit? No, I think we benefit right out of the gate with short-term hikes. Not that yet. It shouldn't be a significant difference from quarter to quarter. Ultimately, you know, the long-term impact of this will be what happens where the middle and long end of the curve shake out from a long-term perspective. In this first few quarters, we'll benefit right out of the gate. Okay, perfect. Maybe, how do your thoughts on deposit betas fit into the equation? Yeah. What we modeled was, I think, a fairly conservative view of deposit betas that are a little below sort of the long-term full cycle rate cycle. In that 10%-20%, which frankly could be very conservative assumption, given how we reacted for the first three rate hikes last cycle. I think we'll be able to manage deposit betas very low for the first year. Okay. Perfect. Thank you. Then just as it relates to the closure of that transaction, how quickly would you guys be able to close after you do receive Fed approval? I imagine you're pretty much good to go, just sort of waiting on that green light. You know, what kind of a timeframe would we be looking at? Well, we need at least 15 days from whenever we receive approval. More than likely, we would do it at the beginning or end of a month or beginning of the next month just to keep the you know accounting clean and smooth. It just depends on when we might hear and how close we are to the next you know kind of beginning of a month, Scott. Again, other than that, we're ready to close. Perfect. All right, good. Thank you guys very much. Your next question is from Terence James McEvoy with Stephens. Good morning, Terence. Hi, good morning, everyone. James, maybe start with a question for you. Old National resolved that issue in Indianapolis kind of a day before the Fed approved a few transactions. You guys obviously weren't on that list. Is there anything that I'm missing out there that maybe I just haven't picked up on? Is there anything you can share with us that gives you confidence that the transaction can close here in the first quarter? Well, you know, all I would say is we continue to have very constructive dialogue, and I think it's just a matter of timing. As you can imagine, there's a lot of priorities right now at the Fed. You know, we had two Fed governors, you know, just as recently as last week going through their confirmation hearings. They got a lot on their plate, right? They got a lot of changes. We are patiently waiting. You know, and those three prior announcements were ones that were in the queue longer than us, right? I have nothing, no reason to believe, you know, that we won't hear positive news. We expect that we'll hear that news here soon and we'll move towards close, like I said. There's no outstanding questions or issues that we're aware of and feel like we're in good shape and ready for approval. Great. It seems like every week a large bank announces a new deposit product to reduce overdraft fees. Could you maybe just talk about the Old National kind of overdraft structure and product? How does that compare to First Midwest, and whether you think you need to make any changes going forward when the two companies combine? I would just say we are aligning our you know process and process together as we come together during the conversion in July. We've been spending a lot of time on that. That probably means slightly lower income for the Old National deposit service charge program. You know we are looking at like everybody else what's going on in the industry. You know, we're not gonna be immune from those changes in the future. I think it's a little early to know exactly how it's gonna shake out for banks our size. Clearly the national banks are moving towards you know a program. We're gonna continue to watch it. We're gonna continue to do the right things. You know, I would say our programs are kind of right in the middle with everybody else, you know, as we align the two programs. We'll just have to wait and see, you know, ultimately if there's a standard that gets set and how that might impact us in the future. Thanks. Maybe if I could squeeze in one more. You mentioned recruiting in Chicago. Is that because you see the pro forma company just having the ability to have a larger kind of platform and the need for more lenders? Or do you expect some attrition and you want to fill some holes, so to speak, in the company? We've really seen almost no or minimal attrition so far and don't expect to have any. I mean, our teams from day one, you know, saw the opportunity, right, and were excited about what that might mean for them. I just think there's an opportunity to continue to invest. We have a great story to tell. When we get a chance to tell the story to potential team members, they like it. They feel the energy, they feel the opportunity that's in front of them. It's being more opportunistic around that. You know, I just believe there's always an opportunity to add talent. You know, and so we're just gonna continue to go out and do that. Nothing that we're worried about in terms of our existing team. We got great team members in Chicago today who are completely capable of doing the work. I do think there's more opportunities. We will have a bigger balance sheet, and I think there'll be more, middle market, opportunities for us as just we combine the two companies. We'll continue to take advantage of that client set and make sure we got team members who can fill those needs. Thank you, James. Thanks, Terence. Your next question is from Christopher McGratty with KBW. Morning, Christopher. Hey. Morning, James. Question on just the balance sheet position to close and pro forma. Brendan, maybe a question for you. Any tweaks that you might be doing on either side of the balance sheet to kind of put your best foot forward pro forma? Yeah, Chris. Yeah, we're taking a look at that. I guess what we can tell you now is anything that we do will not be material to the overall balance sheet. Certainly anything we do, we'll be looking to do in an EPS and capital neutral way. Okay. Once you close, obviously you're in a very strong capital position. What are the philosophical thoughts on a buyback at these levels? We're obviously, you know, don't want to do anything ahead of any kind of Federal Reserve approval. I think once, you know, hopefully we receive approval here soon, I think we can look back at our capital and just make any actions going forward. We're obviously going to be at the low point, you know, once we close and mark the balance sheet. We'll be looking at that, and we'll be looking at it, quite frankly, as, you know, what's the best return of capital, right? We'll just continue to do what we've always done. You know, we probably run a little more capital on average than some of our peers, especially given our credit quality. We'll make sure we do the appropriate thing for shareholders and manage capital, and take a look at that. As Brendan said, you know, it's still a little too early. We're looking at the balance sheet and any potential actions we might take, but if we do anything, it's gonna be pretty minimal. Post-closing the message on a buyback is it's on the table, but it's balanced against, you know, the growth. Is that the right interpretation? Absolutely. Absolutely. Okay. Then maybe one more on deposits. I think we, as analysts, continue to be surprised by the pace and the stickiness of the deposits. What are you seeing, like, incrementally on deposit growth? What are your expectations for maybe the next six to nine months? Yeah, Christopher. I think we were a little surprised, too, at the acceleration of the growth again here in the fourth quarter. It had slowed a bit in the third and picked back up pace. As we study this and look at past cycles, our view is that this sticks around for longer, and that growth may moderate a bit, but we don't see that, at least in the near term, this is gonna run out of the bank very quickly. That said, we are prepared. We have a tremendous amount of absolute liquidity. If this does get ahead of us, I think we have a really strong balance sheet and a great liquidity position to manage through that too. Got it. Thanks. Thanks, Brendan. Your next question is from Jon Glenn Arfstrom with RBC Capital Markets. Morning, Jon. Hey, good morning, everyone. It may be obvious here, but on slide 16, your NII guide, I'm assuming that assumes no rate increases. Is that right, Brendan? That's correct. That's exactly how we're thinking about it. Okay. Yeah. Yeah. Okay. Okay, good. In terms of your expense guide, the 2%-3%, how much of that is hiring versus just, you know, call it natural pressures on expenses like comp and technology? Yeah, I mean, those are the two biggest factors, right? Clearly our merit process is more outsized than it has been in the past. You know, we anticipated this and we tried to get ahead of this a couple years back, but we're also accelerating some of those increases, particularly at the lowest wage side. Obviously, you know, our hiring, I think we'll be pretty consistent with what we did last year. So that's kind of built into the run rate at some level. On average, they are more expensive. The people we're hiring today are more expensive than maybe kind of our average team member today. So, I think like any other bank that I've seen so far, we're not gonna be immune from that. You know, historically, we would have thought our expense growth would have been, you know, flattish year-over-year. Today we're saying it's up, you know, 2% or 3% depending on, you know, kind of those needs. If you set aside the synergies from the merger, safe to assume that we should expect similar type growth at First Midwest on their core? Yes. Similar. Yes. Yeah. Okay. One more thing on lending. It's obviously picked up a little bit for the industry in terms of commercial. You guys have certainly bucked that trend and had better growth. Do you expect the pipeline numbers to continue to increase? Is there anything different in terms of the loan growth story that's emerging right now? Is it just, you know, really more of the same? Yeah, Jon, I would think that pipelines will continue to rebuild and grow like they did last year. We haven't seen anything to the contrary, but certainly staying very close to our customers. Again, optimism for our customer base continues to be good in spite of, you know, the challenges that are facing them with supply chain and labor. I would also add, you know, some of our new talent coming online, Jon, and their ability to you know, run out their non-competes and things like that. I think gives us more confidence. The team we're just putting in place right now in Kansas City, again, those will all be kind of net additive to the pipeline as we continue to hire new talent and get them in a ready place to be successful. Okay. Any theme on the new talent you're hiring? I mean, is it just big bank fatigue wanting to come to a company like yours, but any thematic story behind that? Yeah, I think it's a lot of it. I think, you know, it's sometimes it's hard to do your job, to serve your clients, serve your communities at some of the largest institutions. You know, I think they see a growth story here, a little bit entrepreneurial story here. All that is pretty exciting to be a part of, right? For better or worse, some of those largest competitors we face in our markets have lost that ability to do that. We feel really good about the story and clearly it's working. You know, it's an interesting time right now. We're just kind of working through year-end stuff and but I'm confident we'll continue to hire new talent as we enter the new year here and continue to have lots of opportunities in front of us. Okay. All right. Thank you. At this time, there are no additional questions. Well, thanks everybody for joining us. I know you got a busy day in front of you. As usual, Lynelle, and John, and Brendan, and myself are all here to take phone calls. We appreciate it. Have a great day. Thank you. This concludes the Old National's call. Once again, a replay along with the presentation slides will be available for 12 months on the investor relations page of Old National's website, oldnational.com. A replay of the call will also be available by dialing 855-859-2056. Conference ID code 313815. Again, dial 855-859-2056. Conference ID code 313815. This replay will be available through February the first. If anyone has additional questions, please contact Lynell Walton at 812-464-1366. Again, the number is 812-464-1366. Thank you for your participation in today's conference call. You may now disconnect.