Associated Banc-Corp Reports 2015 Earnings of $1.19 per share on Record Loans and Deposits

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Jan 21, 2016, 04:15 ET

GREEN BAY, Wis., Jan. 21, 2016 /PRNewswire/ -- Associated Banc-Corp (NYSE: ASB) today reported net income available to common shareholders of $181 million, or $1.19 per common share, for the year ended December 31, 2015. This compares to net income available to common shareholders of $186 million, or $1.16 per common share, for the year ended December 31, 2014.

For the quarter ended December 31, 2015, the Company reported earnings of $0.27 per common share. This compares to $0.31 per common share for the quarter ended December 31, 2014.

"In 2015, we reached record levels of loans and deposits. We are particularly pleased by our year over year deposit growth in a competitive environment and transforming industry. In addition, our successful insurance business acquisition drove year over year fee income growth of 13%. We achieved these results with essentially flat expenses, when you adjust for the acquisition," said President and CEO Philip B. Flynn. "Over the past five years, we have rebuilt and diversified our loan portfolio. We grew several specialized commercial lending businesses, including an oil and gas business focused entirely on reserve secured lending. Despite the recent energy price volatility, we remain committed to the energy business and we will continue to proactively manage the risk of our portfolio throughout this current cycle. As we enter 2016, we remain focused on enhancing our customer solutions and driving shareholder value."

2015 HIGHLIGHTS

Average loans grew $1.4 billion, or 8% from a year ago to $18.3 billion
- Commercial lending accounted for 55% of average loan growth
Average deposits grew $2.3 billion, or 13% from a year ago to $19.9 billion
Net interest income of $676 million decreased $5 million, or 1% from last year
- Net interest margin of 2.84% declined from 3.08% in 2014
Noninterest expenses of $697 million increased $18 million, or 3% from last year
- Substantially all the increase was attributable to the insurance business acquisition
During the year, the Company repurchased $93 million, or approximately 5 million shares, of common stock at an average cost of $18.73 per share
Return on average common equity Tier 1 was 9.9% and return on average tangible common equity was 10.0%
Total dividends per common share of $0.41 were up 11% from last year
Capital ratios remain strong with a common equity tier 1 ratio of 9.5% at year end

FOURTH QUARTER AND 2015 FINANCIAL RESULTS

Loans

Full year 2015 average loans of $18.3 billion were up $1.4 billion, or 8% from 2014. Total commercial lending average balances grew $772 million, or 7% from the prior year. Commercial and business lending average balances grew $540 million, or 8% from 2014. Commercial real estate lending average balances grew $232 million, or 6% from 2014. Residential lending average balances increased $675 million, or 14% from the prior year.

Fourth quarter 2015 average loans of $18.5 billion increased $90 million, or 0.5% from the third quarter and increased $1.2 billion, or 7% from the year ago quarter. Total commercial lending average balances decreased $84 million, or 1% from the prior quarter and increased $479 million, or 4% from the year ago quarter. Commercial and business lending average balances declined $198 million, or 3% from the third quarter and was attributed to lower general commercial and mortgage warehouse activity. Commercial and business lending average balances were up $171 million, or 3% from the year ago quarter. Commercial real estate lending average balances grew $113 million, or 3% from the third quarter and are up $307 million, or 8% from the year ago quarter. Residential lending average balances grew $187 million, or 3% from the prior quarter and grew $754 million, or 15% from the year ago quarter.

For the period ended December 31, 2015, total loans of $18.7 billion were up $190 million, or 1% from September 30, 2015, and were up $1.1 billion, or 6% from December 31, 2014. Total commercial lending was up $103 million, or 1% from the prior quarter end, and was up $474 million, or 4% from the prior year end. Total consumer loans were up $87 million or 1% from the prior quarter end and were up $646 million, or 10% from the prior year end.

For the period ended December 31, 2015, the Company's oil and gas exposure was $1 billion of commitments with $752 million of outstandings, representing approximately 4% of the loan portfolio. The loans are all reserve secured. The portfolio was comprised of approximately 50 credits made primarily to small and mid-sized companies.

Deposits

Full year 2015 average deposits of $19.9 billion were up $2.3 billion, or 13% from 2014. Noninterest-bearing demand deposits and interest-bearing demand deposits average balances were up $329 million and $217 million, respectively, from the prior year. Money market average balances were up $1.6 billion, or 21% from 2014. Savings and time deposits average balances had modest growth in 2015.

Fourth quarter 2015 average deposits of $20.6 billion were up $322 million, or 2% compared to the third quarter and increased $2.1 billion, or 11% from the year ago quarter. Noninterest-bearing demand deposits average balances increased $394 million, or 9% from the third quarter and were up $601 million, or 14% from the year ago quarter. Interest-bearing demand deposits average balances decreased $49 million, or 2% from the third quarter, and were modestly up from the year ago quarter. Money market average balances were slightly down compared to the third quarter, and up $1.3 billion, or 16% from the year ago quarter. Average savings balances were flat from the prior quarter and up $94 million, or 7% from the year ago quarter. Average time deposits were down $20 million, or 1% from the third quarter and up $55 million, or 4% from the year ago quarter.

For the period ended December 31, 2015, total deposits of $21.0 billion were up $449 million, or 2% from September 30, 2015, and were up $2.2 billion, or 12% from December 31, 2014. Noninterest-bearing demand deposit balances were up $905 million, or 19% from the prior quarter end and up $1.1 billion, or 23% from the prior year end. Money market balances decreased $414 million, or 4% from the prior quarter end and up $778 million, or 9% from December 31, 2014. Interest-bearing demand deposits were up $29 million, or 1% from the prior quarter end and up $318 million, or 10% from the prior year end. Savings accounts were down $12 million, or 1% from prior quarter end and up $99 million, or 8% from the prior year end.

Net Interest Income and Net Interest Margin

Net interest income of $676 million for 2015 was down $5 million, or 1% from 2014. Fourth quarter net interest income of $171 million increased $1 million, or 1% from the prior quarter and was down $3 million, or 2% compared to the year ago quarter.

Net interest margin of 2.84% for 2015 reflected 24 basis points of compression from 2014. Fourth quarter net interest margin of 2.82% was flat to the prior quarter and 22 basis points lower than the year ago quarter. The majority of the year over year decline was attributed to commercial loan yield compression. In addition, funding costs increased 6 basis points from the year ago quarter, primarily related to the carrying cost of the Company's $500 million of senior and subordinated debt issued in November 2014.

Fourth quarter total earning assets yield of 3.14% was up 1 basis point from the prior quarter. Asset yield compression was offset by $2 million in interest recoveries and deferred fees in the fourth quarter. The net interest margin impact of this activity was approximately 3 basis points for the quarter.

Total interest-bearing funding costs of 0.41% in the fourth quarter were up 1 basis point from the prior quarter.

Noninterest Income

Noninterest income of $328 million for 2015 was up $38 million, or 13% compared to 2014. Insurance commissions were up $31 million, or 70% from the prior year due to the insurance business acquisition in the first quarter of 2015. Mortgage banking income increased $11 million from the prior year due to higher volumes and margins.

Fourth quarter noninterest income was $82 million, up $2 million, or 2% from the third quarter and up $12 million, or 18% from the year ago quarter. Mortgage banking income increased $2 million from the third quarter, primarily driven by higher volumes and positive interest rate marks. Insurance commissions were modestly up from the third quarter, and up $7 million from the year ago quarter. Capital market fees increased $1 million from the prior quarter due to increased customer derivatives activity. Fourth quarter net investment securities gains of $4 million were primarily related to the continued restructuring of the Company's investment portfolio from Fannie Mae and Freddie Mac mortgage backed securities into Ginnie Mae securities.

Noninterest Expense

Total noninterest expense of $697 million in 2015 was up $18 million, or 3% compared to 2014, and was substantially attributable to increased personnel expense related to the insurance business acquisition. Technology expense increased $5 million, or 9% from the prior year. Year over year increases in occupancy and FDIC expense were offset by decreases in several categories including foreclosure/OREO and equipment expense.

Total noninterest expense was $175 million in the fourth quarter, up $3 million, or 2% from both the third quarter and the year ago quarter. Personnel expense decreased $1 million in the fourth quarter due to reduced incentive compensation and lower staffing levels; partially offset by increased health and benefits costs. Business development and advertising increased $2 million from the third quarter driven by the Company's fall marketing campaign. FDIC expense increased $2 million in the fourth quarter related to an increase in FDIC risk premiums. Occupancy was higher in the fourth quarter due to a $2 million expense related to the consolidation of 10 branches during the quarter. Technology, equipment, and legal fees had declines in the fourth quarter.

Taxes

2015 income taxes of $81 million were down $4 million from 2014. The effective tax rate for 2015 was 30% compared to 31% last year.

Credit

Net charge offs of $8 million for the fourth quarter were flat to the third quarter, and up $3 million from the year ago quarter. Potential problem loans increased to $302 million from $264 million in the third quarter, and increased from $190 million in the year ago quarter, primarily attributed to migration within the oil and gas portfolio.

The fourth quarter provision for credit losses was $20 million, up $12 million from the prior quarter, due primarily to an increase in reserves related to energy exposure, driven by the low and volatile price of oil and gas and the resulting downward migration in the portfolio. The allowance for loan losses related to the Company's energy portfolio was $42 million as of December 31, 2015, up from $29 million at the prior quarter end, and up from $17 million at the prior year end. The additional reserves increased the Company's energy reserve as a percent of its energy loans to 5.6% at year end, compared to 3.8% at the prior quarter end, and 2.3% at the prior year end.

Nonaccrual loans of $178 million were up $31 million in the fourth quarter, and were modestly higher than a year ago quarter, primarily attributable to the downgrade of two commercial loans. The nonaccrual loans to total loans ratio increased to 0.95% in the fourth quarter, up from 0.80% in the prior quarter, and down from 1.01% in the year ago quarter.

The Company's allowance for loan losses was $274 million, up $12 million from the third quarter, and up $8 million from the year ago quarter. The allowance for loan losses to total loans ratio increased to 1.47% in the fourth quarter, from 1.42% in the third quarter.

Capital

The Company's capital position remains strong, with a common equity Tier 1 ratio of 9.5% at December 31, 2015. The Company's capital ratios continue to be in excess of the Basel III "well-capitalized" regulatory benchmarks on a fully phased in basis.

FOURTH QUARTER 2015 EARNINGS RELEASE CONFERENCE CALL

The Company will host a conference call for investors and analysts at 4:00 p.m. Central Time (CT) today, January 21, 2016. Interested parties can listen to the call live on the internet through the investor relations section of the company's website, http://investor.associatedbank.com or by dialing 877-407-8037. The slide presentation for the call will be available on the company's website just prior to the call. The number for international callers is 201-689-8037. Participants should ask the operator for the Associated Banc-Corp fourth quarter 2015 earnings call.

An audio archive of the webcast will be available on the company's website at http://investor.associatedbank.com approximately fifteen minutes after the call is over.

ABOUT ASSOCIATED BANC-CORP

Associated Banc-Corp (NYSE: ASB) has total assets of over $27 billion and is one of the top 50 publicly traded U.S. bank holding companies. Headquartered in Green Bay, Wisconsin, Associated is a leading Midwest banking franchise, offering a full range of financial products and services from over 200 banking locations serving more than 100 communities throughout Wisconsin, Illinois and Minnesota, and commercial financial services in Indiana, Michigan, Missouri, Ohio and Texas. Associated Bank, N.A. is an Equal Housing Lender, Equal Opportunity Lender and Member FDIC. More information about Associated Banc-Corp is available at www.associatedbank.com.

FORWARD LOOKING STATEMENTS

Statements made in this document which are not purely historical are forward-looking statements, as defined in the Private Securities Litigation Reform Act of 1995. This includes any statements regarding management's plans, objectives, or goals for future operations, products or services, and forecasts of its revenues, earnings, or other measures of performance. Such forward-looking statements may be identified by the use of words such as "believe", "expect", "anticipate", "plan", "estimate", "should", "will", "intend", "outlook", or similar expressions. Forward-looking statements are based on current management expectations and, by their nature, are subject to risks and uncertainties. Actual results may differ materially from those contained in the forward-looking statements. Factors which may cause actual results to differ materially from those contained in such forward-looking statements include those identified in the Company's most recent Form 10-K and subsequent SEC filings. Such factors are incorporated herein by reference.

NON-GAAP FINANCIAL MEASURES

This press release contains references to measures which are not defined in generally accepted accounting principles ("GAAP"), including "efficiency ratio" and "common equity Tier 1." Information concerning these non-GAAP financial measures can be found in the attached tables.

Investor Contact:
Teresa Gutierrez, Senior Vice President, Director of Investor Relations
920-491-7059

Media Contact:
Cliff Bowers, Senior Vice President, Director of Public Relations
920-491-7542

Associated Banc-Corp Consolidated Balance Sheets (Unaudited)
(in thousands)	Dec 31, 2015		Sep 30, 2015		Seql Qtr $ Change		Jun 30, 2015		Mar 31, 2015		Dec 31, 2014		Comp Qtr $ Change
*Assets*
Cash and due from banks	$	374,921	$	303,701	$	71,220	$	375,369	$	355,541	$	444,113	$	(69,192)
Interest-bearing deposits in other financial institutions	79,764		70,023		9,741		101,573		488,426		571,924		(492,160)
Federal funds sold and securities purchased under agreements to resell	19,000		36,490		(17,490)		39,850		3,380		16,030		2,970
Securities held to maturity, at amortized cost	1,168,230		604,799		563,431		532,382		438,047		404,455		763,775
Securities available for sale, at fair value	4,967,414		5,403,656		(436,242)		5,407,998		5,358,310		5,396,812		(429,398)
Federal Home Loan Bank and Federal Reserve Bank stocks, at cost	147,240		160,871		(13,631)		160,765		189,222		189,107		(41,867)
Loans held for sale	124,915		105,144		19,771		151,146		159,963		154,935		(30,020)
Loans	18,714,343		18,524,773		189,570		18,303,252		17,979,032		17,593,846		1,120,497
Allowance for loan losses	(274,264)		(262,536)		(11,728)		(261,538)		(265,268)		(266,302)		(7,962)
Loans, net	18,440,079		18,262,237		177,842		18,041,714		17,713,764		17,327,544		1,112,535
Premises and equipment, net	267,606		271,119		(3,513)		274,338		274,591		274,688		(7,082)
Goodwill	968,844		968,844		—		968,844		968,774		929,168		39,676
Mortgage servicing rights	61,341		61,402		(61)		61,192		59,733		60,145		1,196
Other intangible assets	16,458		16,978		(520)		17,863		18,251		7,437		9,021
Trading assets	32,192		43,752		(11,560)		35,386		42,336		35,163		(2,971)
Other assets	1,047,017		1,158,227		(111,210)		1,016,725		998,402		1,010,253		36,764
*Total assets*	$	27,715,021	$	27,467,243	$	247,778	$	27,185,145	$	27,068,740	$	26,821,774	$	893,247
*Liabilities and Stockholders' Equity*
Noninterest-bearing demand deposits	$	5,562,466	$	4,657,261	$	905,205	$	4,332,171	$	4,570,872	$	4,505,272	$	1,057,194
Interest-bearing deposits	15,445,199		15,901,134		(455,935)		14,937,392		15,280,720		14,258,232		1,186,967
Total deposits	21,007,665		20,558,395		449,270		19,269,563		19,851,592		18,763,504		2,244,161
Federal funds purchased and securities sold under agreements to repurchase	431,438		702,569		(271,131)		689,699		587,272		493,991		(62,553)
Other short-term funding	402,978		319,766		83,212		905,837		75,265		574,297		(171,319)
Long-term funding	2,679,350		2,679,542		(192)		3,179,734		3,429,925		3,930,117		(1,250,767)
Trading liabilities	33,430		45,817		(12,387)		37,169		44,730		37,329		(3,899)
Accrued expenses and other liabilities	222,914		207,357		15,557		198,752		197,818		222,285		629
Total liabilities	24,777,775		24,513,446		264,329		24,280,754		24,186,602		24,021,523		756,252
Stockholders' Equity
Preferred equity	121,379		121,379		—		122,015		59,727		59,727		61,652
Common stock	1,642		1,642		—		1,642		1,674		1,665		(23)
Surplus	1,458,522		1,455,034		3,488		1,450,200		1,505,170		1,484,933		(26,411)
Retained earnings	1,593,239		1,570,199		23,040		1,538,684		1,509,967		1,497,818		95,421
Accumulated other comprehensive income (loss)	(32,616)		15,376		(47,992)		2,594		24,800		(4,850)		(27,766)
Treasury stock	(204,920)		(209,833)		4,913		(210,744)		(219,200)		(239,042)		34,122
Total stockholders' equity	2,937,246		2,953,797		(16,551)		2,904,391		2,882,138		2,800,251		136,995
*Total liabilities and stockholders' equity*	$	27,715,021	$	27,467,243	$	247,778	$	27,185,145	$	27,068,740	$	26,821,774	$	893,247

Associated Banc-Corp Consolidated Statements of Income (Unaudited)

					Comp Qtr								Comp YTD
(in thousands, except per share amounts)	4Q15		4Q14		$ Change		% Change		YTD Dec 2015		YTD Dec 2014		$ Change		% Change
*Interest Income*
Interest and fees on loans	$	155,602	$	156,536	$	(934)	(0.6)	%	$	615,627	$	598,582	$	17,045	2.8	%
Interest and dividends on investment securities:
Taxable	26,395		25,061		1,334		5.3	%	100,292		102,464		(2,172)		(2.1)	%
Tax-exempt	7,783		7,580		203		2.7	%	31,152		29,064		2,088		7.2	%
Other interest	1,639		1,821		(182)		(10.0)	%	6,591		6,635		(44)		(0.7)	%
Total interest income	191,419		190,998		421		0.2	%	753,662		736,745		16,917		2.3	%
*Interest Expense*
Interest on deposits	8,844		7,319		1,525		20.8	%	33,125		26,294		6,831		26.0	%
Interest on Federal funds purchased and securities sold under agreements to repurchase	229		218		11		5.0	%	943		1,219		(276)		(22.6)	%
Interest on other short-term funding	186		156		30		19.2	%	465		785		(320)		(40.8)	%
Interest on long-term funding	10,692		8,644		2,048		23.7	%	42,851		27,480		15,371		55.9	%
Total interest expense	19,951		16,337		3,614		22.1	%	77,384		55,778		21,606		38.7	%
*Net Interest Income*	171,468		174,661		(3,193)		(1.8)	%	676,278		680,967		(4,689)		(0.7)	%
Provision for credit losses	20,000		5,000		15,000		300.0	%	37,500		16,000		21,500		134.4	%
Net interest income after provision for credit losses	151,468		169,661		(18,193)		(10.7)	%	638,778		664,967		(26,189)		(3.9)	%
*Noninterest Income*
Trust service fees	11,965		12,457		(492)		(3.9)	%	48,840		48,403		437		0.9	%
Service charges on deposit accounts	16,577		17,006		(429)		(2.5)	%	65,471		68,779		(3,308)		(4.8)	%
Card-based and other nondeposit fees	12,694		12,019		675		5.6	%	51,325		49,512		1,813		3.7	%
Insurance commissions	17,997		10,593		7,404		69.9	%	75,363		44,421		30,942		69.7	%
Brokerage and annuity commissions	3,694		3,496		198		5.7	%	15,378		16,089		(711)		(4.4)	%
Total core fee-based revenue	62,927		55,571		7,356		13.2	%	256,377		227,204		29,173		12.8	%
Mortgage banking, net	8,271		2,928		5,343		182.5	%	32,263		21,320		10,943		51.3	%
Capital market fees, net	3,423		2,613		810		31.0	%	10,752		9,973		779		7.8	%
Bank owned life insurance income	2,092		2,739		(647)		(23.6)	%	9,796		13,576		(3,780)		(27.8)	%
Asset gains (losses), net	(1,492)		3,727		(5,219)		(140.0)	%	1,592		10,288		(8,696)		(84.5)	%
Investment securities gains, net	4,095		25		4,070		N/M		8,133		494		7,639		N/M
Other	2,580		2,040		540		26.5	%	9,496		7,464		2,032		27.2	%
Total noninterest income	81,896		69,643		12,253		17.6	%	328,409		290,319		38,090		13.1	%
*Noninterest Expense*
Personnel expense	100,469		97,258		3,211		3.3	%	404,741		390,399		14,342		3.7	%
Occupancy	14,718		14,589		129		0.9	%	60,896		57,677		3,219		5.6	%
Equipment	5,695		6,148		(453)		(7.4)	%	23,209		24,784		(1,575)		(6.4)	%
Technology	13,953		14,581		(628)		(4.3)	%	60,613		55,472		5,141		9.3	%
Business development and advertising	7,652		8,538		(886)		(10.4)	%	25,772		26,144		(372)		(1.4)	%
Other intangible amortization	520		775		(255)		(32.9)	%	3,094		3,747		(653)		(17.4)	%
Loan expense	4,120		3,646		474		13.0	%	14,102		13,866		236		1.7	%
Legal and professional fees	3,963		4,257		(294)		(6.9)	%	17,052		17,485		(433)		(2.5)	%
Foreclosure / OREO expense	1,270		1,168		102		8.7	%	4,494		6,722		(2,228)		(33.1)	%
FDIC expense	7,500		6,956		544		7.8	%	26,000		23,761		2,239		9.4	%
Other	15,032		13,889		1,143		8.2	%	57,426		59,184		(1,758)		(3.0)	%
Total noninterest expense	174,892		171,805		3,087		1.8	%	697,399		679,241		18,158		2.7	%
*Income before income taxes*	58,472		67,499		(9,027)		(13.4)	%	269,788		276,045		(6,257)		(2.3)	%
Income tax expense	15,681		18,761		(3,080)		(16.4)	%	81,487		85,536		(4,049)		(4.7)	%
*Net income*	42,791		48,738		(5,947)		(12.2)	%	188,301		190,509		(2,208)		(1.2)	%
Preferred stock dividends	2,198		1,225		973		79.4	%	7,155		5,002		2,153		43.0	%
*Net income available to common equity*	$	40,593	$	47,513	$	(6,920)	(14.6)	%	$	181,146	$	185,507	$	(4,361)	(2.4)	%
*Earnings Per Common Share:*
Basic	$	0.27	$	0.31	$	(0.04)	(12.9)	%	$	1.20	$	1.17	$	0.03	2.6	%
Diluted	$	0.27	$	0.31	$	(0.04)	(12.9)	%	$	1.19	$	1.16	$	0.03	2.6	%
*Average Common Shares Outstanding:*
Basic	148,834		151,931		(3,097)		(2.0)	%	149,350		157,286		(7,936)		(5.0)	%
Diluted	150,163		153,083		(2,920)		(1.9)	%	150,603		158,254		(7,651)		(4.8)	%

N/M = Not meaningful

Associated Banc-Corp Consolidated Statements of Income (Unaudited)—Quarterly Trend
					Seql Qtr										Comp Qtr
(in thousands, except per share amounts)	4Q15		3Q15		$ Change		% Change		2Q15		1Q15		4Q14		$ Change		% Change
*Interest Income*
Interest and fees on loans	$	155,602	$	155,663	$	(61)	—	%	$	152,417	$	151,945	$	156,536	$	(934)	(0.6)	%
Interest and dividends on investment securities:
Taxable	26,395		24,937		1,458		5.8	%	23,868		25,092		25,061		1,334		5.3	%
Tax-exempt	7,783		7,917		(134)		(1.7)	%	7,565		7,887		7,580		203		2.7	%
Other interest	1,639		1,489		150		10.1	%	1,771		1,692		1,821		(182)		(10.0)	%
Total interest income	191,419		190,006		1,413		0.7	%	185,621		186,616		190,998		421		0.2	%
*Interest Expense*
Interest on deposits	8,844		8,521		323		3.8	%	8,141		7,619		7,319		1,525		20.8	%
Interest on Federal funds purchased and securities sold under agreements to repurchase	229		248		(19)		(7.7)	%	235		231		218		11		5.0	%
Interest on other short-term funding	186		83		103		124.1	%	115		81		156		30		19.2	%
Interest on long-term funding	10,692		10,645		47		0.4	%	10,642		10,872		8,644		2,048		23.7	%
Total interest expense	19,951		19,497		454		2.3	%	19,133		18,803		16,337		3,614		22.1	%
*Net Interest Income*	171,468		170,509		959		0.6	%	166,488		167,813		174,661		(3,193)		(1.8)	%
Provision for credit losses	20,000		8,000		12,000		150.0	%	5,000		4,500		5,000		15,000		300.0	%
Net interest income after provision for credit losses	151,468		162,509		(11,041)		(6.8)	%	161,488		163,313		169,661		(18,193)		(10.7)	%
*Noninterest Income*
Trust service fees	11,965		12,273		(308)		(2.5)	%	12,515		12,087		12,457		(492)		(3.9)	%
Service charges on deposit accounts	16,577		17,385		(808)		(4.6)	%	15,703		15,806		17,006		(429)		(2.5)	%
Card-based and other nondeposit fees	12,694		12,618		76		0.6	%	13,597		12,416		12,019		675		5.6	%
Insurance commissions	17,997		17,561		436		2.5	%	20,077		19,728		10,593		7,404		69.9	%
Brokerage and annuity commissions	3,694		3,809		(115)		(3.0)	%	4,192		3,683		3,496		198		5.7	%
Total core fee-based revenue	62,927		63,646		(719)		(1.1)	%	66,084		63,720		55,571		7,356		13.2	%
Mortgage banking, net	8,271		6,643		1,628		24.5	%	9,941		7,408		2,928		5,343		182.5	%
Capital market fees, net	3,423		2,170		1,253		57.7	%	2,692		2,467		2,613		810		31.0	%
Bank owned life insurance income	2,092		2,448		(356)		(14.5)	%	2,381		2,875		2,739		(647)		(23.6)	%
Asset gains (losses), net	(1,492)		95		(1,587)		N/M		1,893		1,096		3,727		(5,219)		(140.0)	%
Investment securities gains, net	4,095		2,796		1,299		46.5	%	1,242		—		25		4,070		N/M
Other	2,580		2,118		462		21.8	%	2,288		2,510		2,040		540		26.5	%
Total noninterest income	81,896		79,916		1,980		2.5	%	86,521		80,076		69,643		12,253		17.6	%
*Noninterest Expense*
Personnel expense	100,469		101,134		(665)		(0.7)	%	102,986		100,152		97,258		3,211		3.3	%
Occupancy	14,718		14,187		531		3.7	%	14,308		17,683		14,589		129		0.9	%
Equipment	5,695		6,003		(308)		(5.1)	%	5,739		5,772		6,148		(453)		(7.4)	%
Technology	13,953		14,748		(795)		(5.4)	%	16,354		15,558		14,581		(628)		(4.3)	%
Business development and advertising	7,652		5,964		1,688		28.3	%	6,829		5,327		8,538		(886)		(10.4)	%
Other intangible amortization	520		885		(365)		(41.2)	%	888		801		775		(255)		(32.9)	%
Loan expense	4,120		3,305		815		24.7	%	3,681		2,996		3,646		474		13.0	%
Legal and professional fees	3,963		4,207		(244)		(5.8)	%	4,344		4,538		4,257		(294)		(6.9)	%
Foreclosure / OREO expense	1,270		496		774		156.0	%	1,303		1,425		1,168		102		8.7	%
FDIC expense	7,500		6,000		1,500		25.0	%	6,000		6,500		6,956		544		7.8	%
Other	15,032		14,507		525		3.6	%	14,384		13,503		13,889		1,143		8.2	%
Total noninterest expense	174,892		171,436		3,456		2.0	%	176,816		174,255		171,805		3,087		1.8	%
*Income before income taxes*	58,472		70,989		(12,517)		(17.6)	%	71,193		69,134		67,499		(9,027)		(13.4)	%
Income tax expense	15,681		21,551		(5,870)		(27.2)	%	21,793		22,462		18,761		(3,080)		(16.4)	%
*Net income*	42,791		49,438		(6,647)		(13.4)	%	49,400		46,672		48,738		(5,947)		(12.2)	%
Preferred stock dividends	2,198		2,184		14		0.6	%	1,545		1,228		1,225		973		79.4	%
*Net income available to common equity*	$	40,593	$	47,254	$	(6,661)	(14.1)	%	$	47,855	$	45,444	$	47,513	$	(6,920)	(14.6)	%
*Earnings Per Common Share:*
Basic	$	0.27	$	0.31	$	(0.04)	(12.9)	%	$	0.32	$	0.30	$	0.31	$	(0.04)	(12.9)	%
Diluted	$	0.27	$	0.31	$	(0.04)	(12.9)	%	$	0.31	$	0.30	$	0.31	$	(0.04)	(12.9)	%
*Average Common Shares Outstanding:*
Basic	148,834		148,614		220		0.1	%	149,903		150,070		151,931		(3,097)		(2.0)	%
Diluted	150,163		149,799		364		0.2	%	151,108		151,164		153,083		(2,920)		(1.9)	%

N/M = Not meaningful


Associated Banc-Corp Selected Quarterly Information
($ in millions, except per share, full time equivalent employee data and branch count)	YTD 2015			YTD 2014			4Q15			3Q15			2Q15			1Q15			4Q14
*Per Common Share Data*
Dividends	$	0.41		$	0.37		$	0.11		$	0.10		$	0.10		$	0.10		$	0.10
Market value:
High	20.84			19.37			20.61			20.55			20.84			19.07			19.37
Low	16.62			15.58			17.98			17.17			18.50			16.62			16.75
Close	18.75			18.63			18.75			17.97			20.27			18.60			18.63
Book value	18.62			18.32			18.62			18.77			18.44			18.38			18.32
Tangible book value / share	$	12.10		$	12.06		$	12.10		$	12.23		$	11.90		$	11.95		$	12.06
*Performance Ratios (annualized)*
Return on average assets	0.70		%	0.76		%	0.62		%	0.72		%	0.74		%	0.71		%	0.75		%
Effective tax rate	30.20		%	30.99		%	26.82		%	30.36		%	30.61		%	32.49		%	27.79		%
Dividend payout ratio (1)	34.17		%	31.62		%	40.74		%	32.26		%	31.25		%	33.33		%	32.26		%
*Selected Trend Information*
Average full time equivalent employees	4,421			4,406			4,378			4,421			4,465			4,422			4,320
Branch count							215			225			228			227			226
Trust assets under management, at market value							$	7,729		$	7,626		$	8,068		$	8,138		$	7,993
Mortgage loans originated for sale during period							$	317		$	292		$	351		$	268		$	292
Mortgage portfolio serviced for others							$	7,915		$	7,907		$	7,898		$	7,920		$	7,999
Mortgage servicing rights, net / portfolio serviced for others							0.77		%	0.78		%	0.77		%	0.75		%	0.75		%
*Selected Quarterly Ratios*
Loans / deposits							89.08		%	90.11		%	94.99		%	90.57		%	93.77		%
Stockholders' equity / assets							10.60		%	10.75		%	10.68		%	10.65		%	10.44		%
Shares outstanding, end of period							151,239			150,928			150,862			153,567			149,560

(1) Ratio is based upon basic earnings per common share.

Associated Banc-Corp Selected Asset Quality Information
(in thousands)	Dec 31, 2015			Sep 30, 2015			Seql Qtr % Change		Jun 30, 2015			Mar 31, 2015			Dec 31, 2014			Comp Qtr % Change
*Allowance for Loan Losses*
Beginning balance	$	262,536		$	261,538		0.4	%	$	265,268		$	266,302		$	266,262		(1.4)	%
Provision for loan losses	19,500			9,000			116.7	%	5,000			4,500			4,500			333.3	%
Charge offs	(12,741)			(11,732)			8.6	%	(14,537)			(13,270)			(8,778)			45.1	%
Recoveries	4,969			3,730			33.2	%	5,807			7,736			4,318			15.1	%
Net charge offs	(7,772)			(8,002)			(2.9)	%	(8,730)			(5,534)			(4,460)			74.3	%
Ending balance	$	274,264		$	262,536		4.5	%	$	261,538		$	265,268		$	266,302		3.0	%
*Allowance for Unfunded Commitments*
Beginning balance	$	23,900		$	24,900		(4.0)	%	$	24,900		$	24,900		$	24,400		(2.0)	%
Provision for unfunded commitments	500			(1,000)			(150.0)	%	—			—			500			—	%
Ending balance	$	24,400		$	23,900		2.1	%	$	24,900		$	24,900		$	24,900		(2.0)	%
Allowance for credit losses	$	298,664		$	286,436		4.3	%	$	286,438		$	290,168		$	291,202		2.6	%
*Net Charge Offs*	Dec 31, 2015			Sep 30, 2015			Seql Qtr % Change		Jun 30, 2015			Mar 31, 2015			Dec 31, 2014			Comp Qtr % Change
Commercial and industrial	$	4,612		$	4,709		(2.1)	%	$	3,921		$	4,650		$	1,323		248.6	%
Commercial real estate—owner occupied	291			(504)			(157.7)	%	1,198			739			134			117.2	%
Lease financing	(26)			—			N/M		—			—			9			(388.9)	%
Commercial and business lending	4,877			4,205			16.0	%	5,119			5,389			1,466			232.7	%
Commercial real estate—investor	665			496			34.1	%	1,856			(2,529)			(132)			N/M
Real estate construction	(140)			38			(468.4)	%	(673)			(743)			(116)			20.7	%
Commercial real estate lending	525			534			(1.7)	%	1,183			(3,272)			(248)			(311.7)	%
Total commercial	5,402			4,739			14.0	%	6,302			2,117			1,218			343.5	%
Home equity revolving lines of credit	294			533			(44.8)	%	246			1,220			1,094			(73.1)	%
Home equity loans junior liens	623			358			74.0	%	118			423			457			36.3	%
Home equity	917			891			2.9	%	364			1,643			1,551			(40.9)	%
Installment and credit cards	739			810			(8.8)	%	786			769			990			(25.4)	%
Residential mortgage	714			1,562			(54.3)	%	1,278			1,005			701			1.9	%
Total consumer	2,370			3,263			(27.4)	%	2,428			3,417			3,242			(26.9)	%
Total net charge offs	$	7,772		$	8,002		(2.9)	%	$	8,730		$	5,534		$	4,460		74.3	%
Net Charge Offs to Average Loans (in basis points) *	Dec 31, 2015			Sep 30, 2015					Jun 30, 2015			Mar 31, 2015			Dec 31, 2014
Commercial and industrial	31			31					26			32			9
Commercial real estate—owner occupied	12			(21)					48			30			5
Lease financing	(24)			-					-			—			7
Commercial and business lending	28			24					29			31			9
Commercial real estate—investor	8			6					24			(33)			(2)
Real estate construction	(5)			1					(26)			(30)			(5)
Commercial real estate lending	5			5					11			(32)			(2)
Total commercial	19			17					22			8			4
Home equity revolving lines of credit	13			24					11			56			49
Home equity loans junior liens	195			104					32			108			107
Home equity	36			35					14			64			58
Installment and credit cards	69			75					73			70			86
Residential mortgage	5			11					9			8			5
Total consumer	13			18					14			21			19
Total net charge offs	17			17					19			13			10
*Credit Quality*	Dec 31, 2015			Sep 30, 2015			Seql Qtr % Change		Jun 30, 2015			Mar 31, 2015			Dec 31, 2014			Comp Qtr % Change
Nonaccrual loans	$	178,258		$	147,454		20.9	%	$	160,361		$	174,346		$	177,413		0.5	%
Other real estate owned (OREO)	14,569			13,740			6.0	%	13,557			14,926			16,732			(12.9)	%
Total nonperforming assets	$	192,827		$	161,194		19.6	%	$	173,918		$	189,272		$	194,145		(0.7)	%
Loans 90 or more days past due and still accruing	$	1,648		$	1,484		11.1	%	$	1,662		$	1,715		$	1,623		1.5	%
Allowance for loan losses / loans	1.47		%	1.42		%			1.43		%	1.48		%	1.51		%
Allowance for loan losses / nonaccrual loans	153.86			178.05					163.09			152.15			150.10
Nonaccrual loans / total loans	0.95			0.80					0.88			0.97			1.01
Nonperforming assets / total loans plus OREO	1.03			0.87					0.95			1.05			1.10
Nonperforming assets / total assets	0.70			0.59					0.64			0.70			0.72
Net charge offs / average loans *	0.17			0.17					0.19			0.13			0.10
Year-to-date net charge offs / average loans *	0.16			0.16					0.16			0.13			0.09
* Annualized
N/M = Not meaningful

Associated Banc-Corp Selected Asset Quality Information (continued)
(in thousands)	Dec 31, 2015		Sep 30, 2015		Seql Qtr % Change		Jun 30, 2015		Mar 31, 2015		Dec 31, 2014		Comp Qtr % Change
*Nonaccrual loans by type:*
Commercial and industrial	$	91,941	$	58,421	57.4	%	$	64,738	$	61,620	$	49,663	85.1	%
Commercial real estate—owner occupied	8,049		13,368		(39.8)	%	18,821		21,861		25,825		(68.8)	%
Lease financing	1,634		1,763		(7.3)	%	1,656		1,720		1,801		(9.3)	%
Commercial and business lending	101,624		73,552		38.2	%	85,215		85,201		77,289		31.5	%
Commercial real estate—investor	8,643		6,921		24.9	%	6,090		13,742		22,685		(61.9)	%
Real estate construction	940		997		(5.7)	%	2,906		5,423		5,399		(82.6)	%
Commercial real estate lending	9,583		7,918		21.0	%	8,996		19,165		28,084		(65.9)	%
Total commercial	111,207		81,470		36.5	%	94,211		104,366		105,373		5.5	%
Home equity revolving lines of credit	9,917		8,060		23.0	%	8,420		9,171		9,853		0.6	%
Home equity loans junior liens	5,327		5,581		(4.6)	%	5,356		6,145		6,598		(19.3)	%
Home equity	15,244		13,641		11.8	%	13,776		15,316		16,451		(7.3)	%
Installment and credit cards	325		386		(15.8)	%	454		515		613		(47.0)	%
Residential mortgage	51,482		51,957		(0.9)	%	51,920		54,149		54,976		(6.4)	%
Total consumer	67,051		65,984		1.6	%	66,150		69,980		72,040		(6.9)	%
Total nonaccrual loans	$	178,258	$	147,454	20.9	%	$	160,361	$	174,346	$	177,413	0.5	%
*Restructured loans (accruing)*	Dec 31, 2015		Sep 30, 2015		Seql Qtr % Change		Jun 30, 2015		Mar 31, 2015		Dec 31, 2014		Comp Qtr % Change
Commercial and industrial	$	29,293	$	28,598	2.4	%	$	32,063	$	26,466	$	33,892	(13.6)	%
Commercial real estate—owner occupied	7,877		7,343		7.3	%	5,433		9,780		10,454		(24.7)	%
Commercial and business lending	37,170		35,941		3.4	%	37,496		36,246		44,346		(16.2)	%
Commercial real estate—investor	21,915		18,580		17.9	%	22,009		22,775		23,127		(5.2)	%
Real estate construction	510		485		5.2	%	714		717		727		(29.8)	%
Commercial real estate lending	22,425		19,065		17.6	%	22,723		23,492		23,854		(6.0)	%
Total commercial	59,595		55,006		8.3	%	60,219		59,738		68,200		(12.6)	%
Home equity revolving lines of credit	1,332		1,121		18.8	%	1,222		1,251		1,508		(11.7)	%
Home equity loans junior liens	5,737		5,824		(1.5)	%	6,610		6,642		6,701		(14.4)	%
Home equity	7,069		6,945		1.8	%	7,832		7,893		8,209		(13.9)	%
Installment and credit cards	829		804		3.1	%	796		891		974		(14.9)	%
Residential mortgage	19,870		20,054		(0.9)	%	21,373		20,295		20,833		(4.6)	%
Total consumer	27,768		27,803		(0.1)	%	30,001		29,079		30,016		(7.5)	%
Total restructured loans (accruing)	$	87,363	$	82,809	5.5	%	$	90,220	$	88,817	$	98,216	(11.1)	%
Restructured loans in nonaccrual loans (not included above)	$	37,684	$	36,583	3.0	%	$	43,699	$	53,553	$	57,656	(34.6)	%
*Loans Past Due 30-89 Days*	Dec 31, 2015		Sep 30, 2015		Seql Qtr % Change		Jun 30, 2015		Mar 31, 2015		Dec 31, 2014		Comp Qtr % Change
Commercial and industrial	$	1,011	$	2,921	(65.4)	%	$	6,357	$	1,717	$	14,747	(93.1)	%
Commercial real estate—owner occupied	7,142		2,018		253.9	%	1,090		1,849		10,628		(32.8)	%
Lease financing	—		375		(100.0)	%	—		—		—		N/M
Commercial and business lending	8,153		5,314		53.4	%	7,447		3,566		25,375		(67.9)	%
Commercial real estate—investor	291		1,218		(76.1)	%	19,843		2,215		1,208		(75.9)	%
Real estate construction	296		373		(20.6)	%	312		317		984		(69.9)	%
Commercial real estate lending	587		1,591		(63.1)	%	20,155		2,532		2,192		(73.2)	%
Total commercial	8,740		6,905		26.6	%	27,602		6,098		27,567		(68.3)	%
Home equity revolving lines of credit	5,559		6,142		(9.5)	%	5,157		7,150		6,725		(17.3)	%
Home equity loans junior liens	2,360		2,423		(2.6)	%	1,894		1,905		2,058		14.7	%
Home equity	7,919		8,565		(7.5)	%	7,051		9,055		8,783		(9.8)	%
Installment and credit cards	1,870		1,723		8.5	%	1,655		1,818		1,932		(3.2)	%
Residential mortgage	4,930		4,811		2.5	%	6,602		4,356		4,846		1.7	%
Total consumer	14,719		15,099		(2.5)	%	15,308		15,229		15,561		(5.4)	%
Total loans past due 30-89 days	$	23,459	$	22,004	6.6	%	$	42,910	$	21,327	$	43,128	(45.6)	%
*Potential Problem Loans*	Dec 31, 2015		Sep 30, 2015		Seql Qtr % Change		Jun 30, 2015		Mar 31, 2015		Dec 31, 2014		Comp Qtr % Change
Commercial and industrial	$	230,680	$	191,941	20.2	%	$	125,643	$	138,403	$	108,522	112.6	%
Commercial real estate—owner occupied	35,706		41,466		(13.9)	%	41,997		43,114		48,695		(26.7)	%
Lease financing	2,450		233		N/M		1,385		2,009		2,709		(9.6)	%
Commercial and business lending	268,836		233,640		15.1	%	169,025		183,526		159,926		68.1	%
Commercial real estate—investor	25,944		23,633		9.8	%	23,543		26,026		24,043		7.9	%
Real estate construction	3,919		2,354		66.5	%	1,327		1,487		1,776		120.7	%
Commercial real estate lending	29,863		25,987		14.9	%	24,870		27,513		25,819		15.7	%
Total commercial	298,699		259,627		15.0	%	193,895		211,039		185,745		60.8	%
Home equity revolving lines of credit	48		141		(66.0)	%	202		247		204		(76.5)	%
Home equity loans junior liens	174		86		102.3	%	230		711		676		(74.3)	%
Home equity	222		227		(2.2)	%	432		958		880		(74.8)	%
Installment and credit cards	—		—		N/M		—		—		2		(100.0)	%
Residential mortgage	2,796		3,966		(29.5)	%	5,341		6,621		3,781		(26.1)	%
Total consumer	3,018		4,193		(28.0)	%	5,773		7,579		4,663		(35.3)	%
Total potential problem loans	$	301,717	$	263,820	14.4	%	$	199,668	$	218,618	$	190,408	58.5	%
N/M = Not meaningful

Associated Banc-Corp Net Interest Income Analysis—Taxable Equivalent Basis — Sequential Quarter
	Three months ended December 31, 2015						Three months ended September 30, 2015
(in thousands)	Average Balance		Interest Income /Expense		Average Yield /Rate		Average Balance		Interest Income /Expense		Average Yield /Rate
Earning assets:
Loans: (1) (2) (3)
Commercial and business lending	$	6,892,162	$	55,451	3.19	%	$	7,089,664	$	55,944	3.13	%
Commercial real estate lending	4,373,460		37,587		3.41	%	4,260,329		36,694		3.42	%
Total commercial	11,265,622		93,038		3.28	%	11,349,993		92,638		3.24	%
Residential mortgage	5,845,557		47,305		3.24	%	5,658,253		47,004		3.32	%
Retail	1,431,509		16,673		4.65	%	1,444,503		16,913		4.67	%
Total loans	18,542,688		157,016		3.37	%	18,452,749		156,555		3.38	%
Investment securities
Taxable	5,205,033		26,395		2.03	%	4,968,609		24,937		2.01	%
Tax-exempt (1)	1,016,329		11,909		4.69	%	997,489		12,112		4.86	%
Other short-term investments	259,053		1,639		2.53	%	415,496		1,489		1.43	%
Investments and other	6,480,415		39,943		2.47	%	6,381,594		38,538		2.42	%
Total earning assets	25,023,103		$	196,959	3.14	%	24,834,343		$	195,093	3.13	%
Other assets, net	2,437,653						2,445,733
Total assets	$	27,460,756					$	27,280,076
Liabilities and stockholder's equity
Interest-bearing liabilities:
Interest-bearing deposits:
Savings deposits	$	1,358,141	$	249	0.07	%	$	1,357,677	$	254	0.07	%
Interest-bearing demand deposits	3,150,628		1,217		0.15	%	3,199,391		962		0.12	%
Money market deposits	9,534,551		4,351		0.18	%	9,538,030		4,350		0.18	%
Time deposits	1,604,864		3,027		0.75	%	1,624,661		2,955		0.72	%
Total interest-bearing deposits	15,648,184		8,844		0.22	%	15,719,759		8,521		0.22	%
Federal funds purchased and securities sold under agreements to repurchase	605,026		229		0.15	%	649,891		248		0.15	%
Other short-term funding	368,752		186		0.20	%	154,811		83		0.21	%
Total short-term funding	973,778		415		0.17	%	804,702		331		0.16	%
Long-term funding	2,679,472		10,692		1.60	%	3,024,774		10,645		1.41	%
Total short and long-term funding	3,653,250		11,107		1.22	%	3,829,476		10,976		1.15	%
Total interest-bearing liabilities	19,301,434		$	19,951	0.41	%	19,549,235		$	19,497	0.40	%
Noninterest-bearing demand deposits	4,967,719						4,573,840
Other liabilities	250,957						237,725
Stockholders' equity	2,940,646						2,919,276
Total liabilities and stockholders' equity	$	27,460,756					$	27,280,076
Interest rate spread					2.73	%					2.73	%
Net free funds					0.09	%					0.09	%
Net interest income, tax-equivalent, and net interest margin			$	177,008	2.82	%			$	175,596	2.82	%
Fully tax-equivalent adjustment			5,540						5,087
Net interest income			$	171,468					$	170,509
*Net Interest Income Analysis—Taxable Equivalent Basis — Comparable Quarter*
	Three months ended December 31, 2015						Three months ended December 31, 2014
(in thousands)	Average Balance		Interest Income /Expense		Average Yield /Rate		Average Balance		Interest Income /Expense		Average Yield /Rate
Earning assets:
Loans: (1) (2) (3)
Commercial and business lending	$	6,892,162	$	55,451	3.19	%	$	6,720,893	$	59,197	3.50	%
Commercial real estate lending	4,373,460		37,587		3.41	%	4,066,143		37,122		3.62	%
Total commercial	11,265,622		93,038		3.28	%	10,787,036		96,319		3.54	%
Residential mortgage	5,845,557		47,305		3.24	%	5,091,794		43,370		3.40	%
Retail	1,431,509		16,673		4.65	%	1,508,425		17,800		4.70	%
Total loans	18,542,688		157,016		3.37	%	17,387,255		157,489		3.60	%
Investment securities
Taxable	5,205,033		26,395		2.03	%	4,780,268		25,061		2.10	%
Tax-exempt (1)	1,016,329		11,909		4.69	%	917,330		11,597		5.06	%
Other short-term investments	259,053		1,639		2.53	%	407,644		1,821		1.78	%
Investments and other	6,480,415		39,943		2.47	%	6,105,242		38,479		2.52	%
Total earning assets	25,023,103		$	196,959	3.14	%	23,492,497		$	195,968	3.32	%
Other assets, net	2,437,653						2,388,268
Total assets	$	27,460,756					$	25,880,765
Liabilities and stockholder's equity
Interest-bearing liabilities:
Interest-bearing deposits:
Savings deposits	$	1,358,141	$	249	0.07	%	$	1,264,195	$	253	0.08	%
Interest-bearing demand deposits	3,150,628		1,217		0.15	%	3,142,537		1,220		0.15	%
Money market deposits	9,534,551		4,351		0.18	%	8,209,091		3,547		0.17	%
Time deposits	1,604,864		3,027		0.75	%	1,549,565		2,299		0.59	%
Total interest-bearing deposits	15,648,184		8,844		0.22	%	14,165,388		7,319		0.20	%
Federal funds purchased and securities sold under agreements to repurchase	605,026		229		0.15	%	600,969		218		0.14	%
Other short-term funding	368,752		186		0.20	%	464,866		156		0.13	%
Total short-term funding	973,778		415		0.17	%	1,065,835		374		0.14	%
Long-term funding	2,679,472		10,692		1.60	%	3,221,574		8,644		1.07	%
Total short and long-term funding	3,653,250		11,107		1.22	%	4,287,409		9,018		0.84	%
Total interest-bearing liabilities	19,301,434		$	19,951	0.41	%	18,452,797		$	16,337	0.35	%
Noninterest-bearing demand deposits	4,967,719						4,367,031
Other liabilities	250,957						228,600
Stockholders' equity	2,940,646						2,832,337
Total liabilities and stockholders' equity	$	27,460,756					$	25,880,765
Interest rate spread					2.73	%					2.97	%
Net free funds					0.09	%					0.07	%
Net interest income, tax-equivalent, and net interest margin			$	177,008	2.82	%			$	179,631	3.04	%
Fully tax-equivalent adjustment			5,540						4,970
Net interest income			$	171,468					$	174,661

Associated Banc-Corp Net Interest Income Analysis—Taxable Equivalent Basis — Year Over Year
	Year ended December 31, 2015						Year ended December 31, 2014
(in thousands)	Average Balance		Interest Income /Expense		Average Yield /Rate		Average Balance		Interest Income /Expense		Average Yield /Rate
Earning assets:
Loans: (1) (2) (3)
Commercial and business lending	$	7,035,449	$	223,639	3.18	%	$	6,495,338	$	219,386	3.38	%
Commercial real estate lending	4,222,218		146,372		3.47	%	3,990,675		146,802		3.68	%
Total commercial	11,257,667		370,011		3.29	%	10,486,013		366,188		3.49	%
Residential mortgage	5,538,690		182,228		3.29	%	4,864,054		168,830		3.47	%
Retail	1,455,907		67,524		4.64	%	1,488,927		67,382		4.53	%
Total loans	18,252,264		619,763		3.40	%	16,838,994		602,400		3.58	%
Investment securities
Taxable	4,936,065		100,292		2.03	%	4,726,511		102,464		2.17	%
Tax-exempt (1)	976,784		47,663		4.88	%	867,721		44,467		5.12	%
Other short-term investments	405,974		6,591		1.62	%	326,902		6,635		2.03	%
Investments and other	6,318,823		154,546		2.45	%	5,921,134		153,566		2.59	%
Total earning assets	24,571,087		$	774,309	3.15	%	22,760,128		$	755,966	3.32	%
Other assets, net	2,451,923						2,351,469
Total assets	$	27,023,010					$	25,111,597
Liabilities and stockholder's equity
Interest-bearing liabilities:
Interest-bearing deposits:
Savings deposits	$	1,336,755	$	1,000	0.07	%	$	1,249,452	$	968	0.08	%
Interest-bearing demand deposits	3,201,085		4,266		0.13	%	2,983,747		4,124		0.14	%
Money market deposits	9,210,179		16,574		0.18	%	7,614,042		12,452		0.16	%
Time deposits	1,613,547		11,285		0.70	%	1,587,641		8,750		0.55	%
Total interest-bearing deposits	15,361,566		33,125		0.22	%	13,434,882		26,294		0.20	%
Federal funds purchased and securities sold under agreements to repurchase	625,736		943		0.15	%	795,257		1,219		0.15	%
Other short-term funding	220,321		465		0.21	%	573,460		785		0.14	%
Total short-term funding	846,057		1,408		0.17	%	1,368,717		2,004		0.15	%
Long-term funding	3,127,018		42,851		1.37	%	3,022,787		27,480		0.91	%
Total short and long-term funding	3,973,075		44,259		1.11	%	4,391,504		29,484		0.67	%
Total interest-bearing liabilities	19,334,641		$	77,384	0.40	%	17,826,386		$	55,778	0.31	%
Noninterest-bearing demand deposits	4,541,521						4,212,202
Other liabilities	251,690						201,077
Stockholders' equity	2,895,158						2,871,932
Total liabilities and stockholders' equity	$	27,023,010					$	25,111,597
Interest rate spread					2.75	%					3.01	%
Net free funds					0.09	%					0.07	%
Net interest income, tax-equivalent, and net interest margin			$	696,925	2.84	%			$	700,188	3.08	%
Fully tax-equivalent adjustment			20,647						19,221
Net interest income			$	676,278					$	680,967

(1)	The yield on tax exempt loans and securities is computed on a fully tax-equivalent basis using a tax rate of 35% for all periods presented and is net of the effects of certain disallowed interest deductions.
(2)	Nonaccrual loans and loans held for sale have been included in the average balances.
(3)	Interest income includes net loan fees.

*Associated Banc-Corp*
*Financial Summary and Comparison* (in thousands)
*Period End Loan Composition*	Dec 31, 2015		Sep 30, 2015		Seql Qtr % Change		Jun 30, 2015		Mar 31, 2015		Dec 31, 2014		Comp Qtr % Change
Commercial and industrial	$	6,147,440	$	6,085,473	1.0	%	$	6,208,192	$	6,140,420	$	5,905,902	4.1	%
Commercial real estate—owner occupied	918,212		966,689		(5.0)	%	978,183		1,003,885		1,007,937		(8.9)	%
Lease financing	43,243		42,607		1.5	%	46,900		49,496		51,529		(16.1)	%
Commercial and business lending	7,108,895		7,094,769		0.2	%	7,233,275		7,193,801		6,965,368		2.1	%
Commercial real estate—investor	3,234,266		3,183,352		1.6	%	3,126,440		3,086,980		3,056,485		5.8	%
Real estate construction	1,162,145		1,124,280		3.4	%	1,092,308		1,019,571		1,008,956		15.2	%
Commercial real estate lending	4,396,411		4,307,632		2.1	%	4,218,748		4,106,551		4,065,441		8.1	%
Total commercial	11,505,306		11,402,401		0.9	%	11,452,023		11,300,352		11,030,809		4.3	%
Home equity revolving lines of credit	883,759		883,573		—	%	880,628		879,827		887,779		(0.5)	%
Home equity loans junior liens	122,043		130,892		(6.8)	%	141,344		154,120		164,148		(25.7)	%
Home equity	1,005,802		1,014,465		(0.9)	%	1,021,972		1,033,947		1,051,927		(4.4)	%
Installment and credit cards	419,968		425,729		(1.4)	%	430,823		436,492		454,219		(7.5)	%
Residential mortgage	5,783,267		5,682,178		1.8	%	5,398,434		5,208,241		5,056,891		14.4	%
Total consumer	7,209,037		7,122,372		1.2	%	6,851,229		6,678,680		6,563,037		9.8	%
Total loans	$	18,714,343	$	18,524,773	1.0	%	$	18,303,252	$	17,979,032	$	17,593,846	6.4	%
*Period End Deposit and Customer Funding Composition*	Dec 31, 2015		Sep 30, 2015		Seql Qtr % Change		Jun 30, 2015		Mar 31, 2015		Dec 31, 2014		Comp Qtr % Change
Noninterest-bearing demand	$	5,562,466	$	4,657,261	19.4	%	$	4,332,171	$	4,570,872	$	4,505,272	23.5	%
Savings	1,334,420		1,346,407		(0.9)	%	1,359,478		1,337,643		1,235,277		8.0	%
Interest-bearing demand	3,445,000		3,416,429		0.8	%	3,576,311		3,525,870		3,126,854		10.2	%
Money market	9,102,977		9,516,503		(4.3)	%	8,374,186		8,781,206		8,324,646		9.3	%
Brokered CDs	42,443		42,689		(0.6)	%	39,760		40,699		42,556		(0.3)	%
Other time	1,520,359		1,579,106		(3.7)	%	1,587,657		1,595,302		1,528,899		(0.6)	%
Total deposits	21,007,665		20,558,395		2.2	%	19,269,563		19,851,592		18,763,504		12.0	%
Customer repo sweeps	383,568		524,630		(26.9)	%	433,044		528,572		384,221		(0.2)	%
Total deposits and customer funding	$	21,391,233	$	21,083,025	1.5	%	$	19,702,607	$	20,380,164	$	19,147,725	11.7	%
Network transaction deposits included above in interest-bearing demand & money market	$	3,174,911	$	3,207,867	(1.0)	%	$	2,920,939	$	2,900,325	$	2,852,943	11.3	%
Brokered CDs	42,443		42,689		(0.6)	%	39,760		40,699		42,556		(0.3)	%
Total network and brokered funding	3,217,354		3,250,556		(1.0)	%	2,960,699		2,941,024		2,895,499		11.1	%
Net customer deposits and funding (1)	$	18,173,879	$	17,832,469	1.9	%	$	16,741,908	$	17,439,140	$	16,252,226	11.8	%

*Quarter Average Loan Composition*	Dec 31, 2015		Sep 30, 2015		Seql Qtr % Change		Jun 30, 2015		Mar 31, 2015		Dec 31, 2014		Comp Qtr % Change
Commercial and industrial	$	5,905,034	$	6,074,168	(2.8)	%	$	6,122,864	$	5,944,152	$	5,665,396	4.2	%
Commercial real estate—owner occupied	944,223		970,112		(2.7)	%	995,981		998,293		1,003,179		(5.9)	%
Lease financing	42,905		45,384		(5.5)	%	48,470		50,724		52,318		(18.0)	%
Commercial and business lending	6,892,162		7,089,664		(2.8)	%	7,167,315		6,993,169		6,720,893		2.5	%
Commercial real estate—investor	3,266,008		3,134,454		4.2	%	3,110,637		3,106,965		3,062,427		6.6	%
Real estate construction	1,107,452		1,125,875		(1.6)	%	1,038,318		995,768		1,003,716		10.3	%
Commercial real estate lending	4,373,460		4,260,329		2.7	%	4,148,955		4,102,733		4,066,143		7.6	%
Total commercial	11,265,622		11,349,993		(0.7)	%	11,316,270		11,095,902		10,787,036		4.4	%
Home equity revolving lines of credit	882,599		880,660		0.2	%	881,036		882,869		883,580		(0.1)	%
Home equity loans junior liens	126,658		136,254		(7.0)	%	147,391		159,378		169,845		(25.4)	%
Home equity	1,009,257		1,016,914		(0.8)	%	1,028,427		1,042,247		1,053,425		(4.2)	%
Installment and credit cards	422,252		427,589		(1.2)	%	432,415		445,268		455,000		(7.2)	%
Residential mortgage	5,845,557		5,658,253		3.3	%	5,411,193		5,231,698		5,091,794		14.8	%
Total consumer	7,277,066		7,102,756		2.5	%	6,872,035		6,719,213		6,600,219		10.3	%
Total loans	$	18,542,688	$	18,452,749	0.5	%	$	18,188,305	$	17,815,115	$	17,387,255	6.6	%
*Quarter Average Deposit Composition*	Dec 31, 2015		Sep 30, 2015		Seql Qtr % Change		Jun 30, 2015		Mar 31, 2015		Dec 31, 2014		Comp Qtr % Change
Noninterest-bearing demand	$	4,967,719	$	4,573,840	8.6	%	$	4,290,567	$	4,326,557	$	4,367,031	13.8	%
Savings	1,358,141		1,357,677		—	%	1,352,616		1,277,469		1,264,195		7.4	%
Interest-bearing demand	3,150,628		3,199,391		(1.5)	%	3,251,196		3,203,727		3,142,537		0.3	%
Money market	9,534,551		9,538,030		—	%	9,101,589		8,653,260		8,209,091		16.1	%
Time deposits	1,604,864		1,624,661		(1.2)	%	1,630,242		1,594,183		1,549,565		3.6	%
Total deposits	$	20,615,903	$	20,293,599	1.6	%	$	19,626,210	$	19,055,196	$	18,532,419	11.2	%

(1) Total deposits and customer funding excluding total network and brokered funding.

Associated Banc-Corp Non-GAAP Financial Measures Reconciliation
($ in millions)	YTD 2015		YTD 2014		4Q15			3Q15			2Q15			1Q15			4Q14
*Common Equity Tier 1 Reconciliation (1)*
Common equity					$	2,816		$	2,832		$	2,782		$	2,823		$	2,740
Goodwill and other intangible assets					(985)			(986)			(987)			(987)			(937)
Tangible common equity					1,831			1,846			1,795			1,836			1,803
Accumulated other comprehensive income					33			(15)			(2)			(25)			5
Deferred tax assets / deferred tax liabilities, net					34			34			32			27			—
Common equity Tier 1					$	1,898		$	1,865		$	1,825		$	1,838		$	1,808
*Average Common Equity Tier 1 Reconciliation (1)*
Common equity					$	2,819		$	2,798		$	2,794		$	2,785		$	2,772
Goodwill and other intangible assets					(985)			(986)			(987)			(971)			(937)
Tangible common equity					1,834			1,812			1,807			1,814			1,835
Accumulated other comprehensive income					4			(7)			(16)			(18)			(14)
Deferred tax assets / deferred tax liabilities, net					34			32			29			8			—
Average common equity Tier 1					$	1,872		$	1,837		$	1,820		$	1,804		$	1,821
*Risk-based Capital (1) (2)*
Risk-weighted assets					$	19,933		$	19,866		$	19,629		$	19,565		$	18,568
Common equity Tier 1 / risk-weighted assets					9.52		%	9.39		%	9.30		%	9.39		%	9.74		%
Tier 1 leverage ratio					7.60		%	7.53		%	7.53		%	7.39		%	7.48		%
Tier 1 risk-based capital ratio					10.12		%	9.98		%	9.89		%	9.70		%	10.06		%
Total risk-based capital ratio					12.62		%	12.49		%	12.41		%	12.21		%	12.66		%
*Selected Equity and Performance Ratios (1) (3)*
Tangible common equity / tangible assets					6.85		%	6.97		%	6.85		%	7.04		%	6.97		%
Tangible equity / tangible assets					7.30		%	7.43		%	7.32		%	7.27		%	7.20		%
Return on average tangible common equity	9.97	%	9.91	%	8.78		%	10.35		%	10.62		%	10.16		%	10.27		%
Return on average common equity Tier 1	9.88	%	9.92	%	8.60		%	10.20		%	10.55		%	10.22		%	10.35		%
*Efficiency Ratio Reconciliation (4)*
Federal Reserve efficiency ratio	69.93	%	70.28	%	70.36		%	68.83		%	70.23		%	70.30		%	70.54		%
Taxable equivalent adjustment	(1.42)	%	(1.36)	%	(1.53)		%	(1.39)		%	(1.34)		%	(1.42)		%	(1.41)		%
Other intangible amortization	(0.30)	%	(0.39)	%	(0.20)		%	(0.35)		%	(0.35)		%	(0.32)		%	(0.31)		%
Fully tax-equivalent efficiency ratio	68.21	%	68.53	%	68.63		%	67.09		%	68.54		%	68.56		%	68.82		%


(1)	The Federal Reserve establishes regulatory capital requirements, including well-capitalized standards for the Corporation. Prior to 2015, the regulatory capital requirements effective for the Corporation followed the Capital Accord of the Basel Committee on Banking Supervision ("Basel I"). Beginning January 1, 2015, the regulatory capital requirements effective for the Corporation follow Basel III, subject to certain transition provisions. These regulatory capital measurements are used by management, regulators, investors, and analysts to assess, monitor and compare the quality and composition of our capital with the capital of other financial services companies.
(2)	December 31, 2015 data is estimated.
(3)	The ratios tangible common equity to tangible assets and tangible equity to tangible assets exclude goodwill and other intangible assets, which is a non-GAAP financial measure. These financial measures have been included as they are considered to be critical metrics with which to analyze and evaluate financial condition and capital strength.
(4)	The efficiency ratio as defined by the Federal Reserve guidance is noninterest expense (which includes the provision for unfunded commitments) divided by the sum of net interest income plus noninterest income, excluding investment securities gains / losses, net. The fully tax-equivalent efficiency ratio is noninterest expense (which includes the provision for unfunded commitments), excluding other intangible amortization, divided by the sum of taxable equivalent net interest income plus noninterest income, excluding investment securities gains / losses, net. Management believes the fully tax-equivalent efficiency ratio, which adjusts net interest income for the tax-favored status of certain loans and investment securities, to be the preferred industry measurement as it enhances the comparability of net interest income arising from taxable and tax-exempt sources.