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What changed in BYLINE BANCORP, INC.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of BYLINE BANCORP, INC.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+654 added−635 removedSource: 10-K (2025-02-28) vs 10-K (2024-03-04)

Top changes in BYLINE BANCORP, INC.'s 2024 10-K

654 paragraphs added · 635 removed · 524 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

98 edited+33 added−26 removed164 unchanged
Biggest changeThe substance or impact of pending or future legislation or regulation, or the application thereof, cannot be predicted, although enactment of the proposed legislation could affect the regulatory structure under which we operate and may significantly increase our costs, impede the efficiency of our internal business processes, require us to increase our regulatory capital or modify our business strategy, or limit our ability to pursue business opportunities in an efficient manner.
Biggest changeThe substance or impact of the proposed new leadership changes at the federal bank supervisory agencies, pending or future legislation or regulation, and any changes to existing financial regulations, cannot be predicted, although these developments could affect the regulatory structure under which we operate and may materially impact our business operations.
Item 1. Business . General Byline Bancorp, Inc., headquartered in Chicago, Illinois, is a bank holding company and we conduct all our business activities through our subsidiary, Byline Bank, a full service commercial bank, and Byline Bank’s subsidiaries. The words "the Company," "we," "Byline," "our" and "us" refer to Byline Bancorp, Inc. and its consolidated subsidiaries, unless we indicate otherwise.
Item 1. Business . General Byline Bancorp, Inc., headquartered in Chicago, Illinois, is a bank holding company. We conduct all our business activities through our subsidiary, Byline Bank, a full service commercial bank, and Byline Bank’s subsidiaries. The words "the Company," "we," "Byline," "our" and "us" refer to Byline Bancorp, Inc. and its consolidated subsidiaries, unless we indicate otherwise.
We strive to become an employer of choice and many of our advantages are found within our four Total Rewards pillars: Pay, Benefits, Health and Wellness, Work-Life Harmony, and Professional Development. Pay We believe our compensation strategy supports our core principles and provides every employee with a competitive compensation package that fairly reflects their individual contributions to Byline.
We strive to become an employer of choice and many of our advantages are found within our four Total Rewards pillars: Pay, Benefits, Health and Wellness, Work-Life Harmony, and Professional Development. We believe our compensation strategy supports our core principles and provides every employee with a competitive compensation package that fairly reflects their individual contributions to Byline.
The second final rule provides that such CDD requirements could include anti-money laundering and countering the financing of terrorism obligations set forth under the Bank Secrecy Act (e.g., anti-money laundering program, customer identification, suspicious activity reports filing and enhanced due diligence requirements) and compliance with the U.S. Treasury’s Office of Foreign Assets Control ("OFAC") sanctions.
The second final rule provides that such CDD requirements could include anti-money laundering and countering the financing of terrorism ("CFT") obligations set forth under the Bank Secrecy Act (e.g., anti-money laundering program, customer identification, suspicious activity reports filing and enhanced due diligence requirements) and compliance with the U.S. Treasury’s Office of Foreign Assets Control ("OFAC") sanctions.
On April 27, 2021, the CFPB issued two new rules that would modify qualified mortgage loan requirements and provide flexibility to banks and other lenders in determining consumers’ ability-to-repay. Compliance with these rules was required by October 1, 2022. Byline Bank complies with, and will continue with, all applicable qualified mortgage loan requirements.
On April 27, 2021, the CFPB issued two new rules that would modify qualified mortgage loan requirements and provide flexibility to banks and other lenders in determining consumers’ ability-to-repay. Compliance with these rules was required by October 1, 2022. Byline Bank complies with, and will continue to comply with, all applicable qualified mortgage loan requirements.
A bank will be (i) "well capitalized" if the institution has a total risk-based capital ratio of 10% or greater, a CET1 capital ratio of 6.5% or greater, a Tier 1 risk-based capital ratio of 8% or greater and a leverage ratio of 5% or greater, and is not subject to any order 12 Table of Contents or written directive by any such regulatory authority to meet and maintain a specific capital level for any capital measure;(ii) "adequately capitalized" if the institution has a total risk-based capital ratio of 8% or greater, a CET1 capital ratio of 4.5% or greater, a Tier 1 risk- based capital ratio of 6% or greater and a leverage ratio of 4% or greater and is not "well capitalized;" (iii) "undercapitalized" if the institution has a total risk-based capital ratio that is less than 8%, a CET1 capital ratio less than 4.5%, a Tier 1 risk-based capital ratio of less than 6% or a leverage ratio of less than 4%; (iv) "significantly undercapitalized" if the institution has a total risk-based capital ratio of less than 6%, a CET1 capital ratio less than 3%, a Tier 1 risk-based capital ratio of less than 4% or a leverage ratio of less than 3%; and (v) "critically undercapitalized" if the institution’s tangible equity is equal to or less than 2% of average quarterly tangible assets.
A bank will be (i) "well capitalized" if the institution has a total risk-based capital ratio of 10% or greater, a CET1 capital ratio of 6.5% or greater, a Tier 1 risk-based capital ratio of 8% or greater and a leverage ratio of 5% or greater, and is not subject to any order or written directive by any such regulatory authority to meet and maintain a specific capital level for any capital measure;(ii) "adequately capitalized" if the institution has a total risk-based capital ratio of 8% or greater, a CET1 capital ratio of 4.5% or greater, a Tier 1 risk- based capital ratio of 6% or greater and a leverage ratio of 4% or greater and is not "well capitalized;" (iii) "undercapitalized" if the institution has a total risk-based capital ratio that is less than 8%, a CET1 capital ratio less than 4.5%, a Tier 1 risk-based capital ratio 11 Table of Contents of less than 6% or a leverage ratio of less than 4%; (iv) "significantly undercapitalized" if the institution has a total risk-based capital ratio of less than 6%, a CET1 capital ratio less than 3%, a Tier 1 risk-based capital ratio of less than 4% or a leverage ratio of less than 3%; and (v) "critically undercapitalized" if the institution’s tangible equity is equal to or less than 2% of average quarterly tangible assets.
The following charts outline the composition of our loan and lease and deposit portfolios as of December 31, 2023: 4 Table of Contents Acquisitions Our ability to engage in certain merger or acquisition transactions depends on a number of factors, including opportunities in our market areas, access to capital, our bank regulators' views at the time as to the capital levels, quality of management and our overall financial condition, in addition to their assessment of a variety of other factors, including our compliance with laws and regulations.
The following charts outline the composition of our loan and lease and deposit portfolios as of December 31, 2024: 4 Table of Contents Acquisitions Our ability to engage in certain merger or acquisition transactions depends on a number of factors, including opportunities in our market areas, access to capital, our bank regulators' views at the time as to the capital levels, quality of management and our overall financial condition, in addition to their assessment of a variety of other factors, including our compliance with laws and regulations.
The total unpaid principal balances of SBA and USDA loans serviced for others was $1.7 billion at December 31, 2023. Community banking We offer customers traditional deposit products through our branch network, consumer and business online account opening through our website, and customer access to their accounts through online and mobile banking platforms.
The total unpaid principal balances of SBA and USDA loans serviced for others was $1.7 billion at December 31, 2024. Community banking We offer customers traditional deposit products through our branch network, consumer and business online account opening through our website, and customer access to their accounts through online and mobile banking platforms.
Covered transactions are defined by statute to include a loan or extension of credit, as well as a purchase of securities issued by an affiliate, a purchase of 10 Table of Contents assets (unless otherwise exempted by the FRB) from the affiliate, certain derivative transactions with an affiliate, the acceptance of securities issued by the affiliate as collateral for a loan, and the issuance of a guarantee, acceptance or letter of credit on behalf of an affiliate.
Covered transactions are defined by statute to include a loan or extension of credit, as well as a purchase of securities issued by an affiliate, a purchase of assets (unless otherwise exempted by the FRB) from the affiliate, certain derivative transactions with an affiliate, 9 Table of Contents the acceptance of securities issued by the affiliate as collateral for a loan, and the issuance of a guarantee, acceptance or letter of credit on behalf of an affiliate.
The federal banking regulators previously issued guidance in December 2006, entitled "Interagency Guidance on Concentrations in Commercial Real Estate Lending, Sound Risk Management Practices," which stated that an institution is potentially exposed to significant commercial real estate concentration risk, and should employ enhanced risk management practices, where (1) total commercial real estate loans represent 300% or more of its total capital and (2) the outstanding balance of such institution’s commercial real estate loan portfolio has increased by 50% or more during the prior 36 months.
The federal banking regulators also previously issued guidance, entitled "Interagency Guidance on Concentrations in Commercial Real Estate Lending, Sound Risk Management Practices," which stated that an institution is potentially exposed to significant commercial real estate concentration risk, and should employ enhanced risk management practices, where (1) total commercial real estate loans represent 300% or more of its total capital and (2) the outstanding balance of such institution’s commercial real estate loan portfolio has increased by 50% or more during the prior 36 months.
Sherylle Olano, 46, became Senior Vice President and Chief Accounting Officer of Byline and Byline Bank in August 2022. Prior to that, Ms. Olano previously served as Controller since 2014. Alberto J. Paracchini, 53, is President and a Director of Byline Bancorp, Inc. and Chief Executive Officer, President and a Director of Byline Bank. He joined Byline in June 2013.
Sherylle Olano, 46, became Senior Vice President and Chief Accounting Officer of Byline and Byline Bank in August 2022. Prior to that, Ms. Olano previously served as Controller since 2014. Alberto J. Paracchini, 54, is President and a Director of Byline Bancorp, Inc. and Chief Executive Officer, President and a Director of Byline Bank. He joined Byline in June 2013.
Branch network and distribution channels The primary market in which we operate is the Chicago metropolitan area, and our 47 branch network in this area is our core distribution channel. We take advantage of our focused footprint and deep-rooted relationships to target local customers with a diversified product offering.
Branch network and distribution channels The primary market in which we operate is the Chicago metropolitan area, and our 45 branch network in this area is our core distribution channel. We take advantage of our focused footprint and deep-rooted relationships to target local customers with a diversified product offering.
Under the Illinois Banking Act, our bank may generally engage in all usual banking activities, including, among other things, accepting deposits; lending money on personal and real estate security; issuing letters of credit; buying, discounting, and negotiating promissory notes and other forms of indebtedness; buying and selling foreign currency and, subject to certain limitations, certain investment securities; engaging in certain insurance activities and maintaining safe deposit boxes on premises.
Under the Illinois Banking Act, our bank may generally engage in all usual banking activities, including, among other things, accepting deposits; lending money on personal and real estate security; issuing letters of credit; buying, discounting, and negotiating 8 Table of Contents promissory notes and other forms of indebtedness; buying and selling foreign currency and, subject to certain limitations, certain investment securities; engaging in certain insurance activities and maintaining safe deposit boxes on premises.
Brogan Ptacin, 63, became Executive Vice President and Head of Commercial Banking for Byline Bank in January 2019. Prior to that, Mr. Ptacin served as a Managing Director of First Bank & Trust since 2009 until First Bank & Trust was acquired by Byline in 2018.
Brogan Ptacin, 64, became Executive Vice President and Head of Commercial Banking for Byline Bank in January 2019. Prior to that, Mr. Ptacin served as a Managing Director of First Bank & Trust since 2009 until First Bank & Trust was acquired by Byline in 2018.
Herencia, 64, became Chairman of Byline Bancorp, Inc. and Byline Bank in June 2013, and Executive Chairman and Chief Executive Officer in February, 2021. He serves as a member of the Board of Director’s risk committee, and as a member of the risk, executive credit, trust, and Asset- Liability Committee ("ALCO") committees of Byline Bank.
Herencia, 65, became Chairman of Byline Bancorp, Inc. and Byline Bank in June 2013, and Executive Chairman and Chief Executive Officer in February, 2021. He serves as a member of the Board of Director’s risk committee, and as a member of the risk, executive credit, trust, and Asset- Liability Committee ("ALCO") committees of Byline Bank.
These risk-weighting categories depend on the nature of the assets, generally ranging from 0%, for U.S. government and agency securities, to 600% for certain equity exposures, and resulting in higher risk weights for a variety of asset categories.
These risk-weighting categories depend on the nature of the assets, generally ranging from 0%, for U.S. government and agency securities, to 600% for certain equity exposures, and result in higher risk weights for a variety of asset categories.
For additional information, please see our definitive proxy statement for our 2024 Annual Meeting of Stockholders, a copy of which will be filed with the SEC no later than 120 days after the end of our fiscal year.
For additional information, please see our definitive proxy statement for our 2025 Annual Meeting of Stockholders, a copy of which will be filed with the SEC no later than 120 days after the end of our fiscal year.
Michelle Johnson, 42, became Executive Vice President and Chief Risk Officer of Byline Bank in October 2019. Prior to that, Ms. Johnson served as Deputy Chief Risk Officer since 2018. Ms. Johnson joined Byline Bank in 2015 as Director of IT Risk Management.
Michelle Johnson, 43, became Executive Vice President and Chief Risk Officer of Byline Bank in October 2019. Prior to that, Ms. Johnson served as Deputy Chief Risk Officer since 2018. Ms. Johnson joined Byline Bank in 2015 as Director of IT Risk Management.
These laws include the Equal Credit Opportunity Act (the "ECOA"), the Fair Credit Reporting Act, the Truth in Lending Act (the "TILA"), the Truth in Savings Act, the Electronic Fund Transfer Act, the Expedited Funds Availability Act, the Home Mortgage 14 Table of Contents Disclosure Act, the Fair Housing Act, the Real Estate Settlement Procedures Act, the Fair Debt Collection Practices Act, the Fair Credit Reporting Act, the Service Members Civil Relief Act, the Right to Financial Privacy Act, the Telephone Consumer Protection Act, the CAN-SPAM Act, and these laws’ respective state-law counterparts, as well as state usury laws and laws regarding unfair and deceptive acts and practices.
These laws include the Equal Credit Opportunity Act (the "ECOA"), the Fair Credit Reporting Act, the Truth in Lending Act (the "TILA"), the Truth in Savings Act, the Electronic Fund Transfer Act, the Expedited Funds Availability Act, the Home Mortgage Disclosure Act, the Fair Housing Act, the Real Estate Settlement Procedures Act, the Fair Debt Collection Practices Act, the Fair Credit Reporting Act, the Service Members Civil Relief Act, the Right to Financial Privacy Act, the Telephone Consumer Protection Act, the CAN-SPAM Act, and these laws’ respective state-law counterparts, as well as state usury laws and laws regarding unfair and deceptive acts and practices.
We also support our business customers with a variety of deposit and treasury management products, along with business transaction accounts. Our comprehensive suite of products includes treasury services, information reporting, fraud management, cash collection, and interest rate derivative products.
We also support our business customers with deposit and treasury management products, along with business transaction accounts. Our comprehensive suite of products includes treasury services, information reporting, fraud management, cash collection, and interest rate derivative products.
If, after being so notified, an institution fails to submit an acceptable compliance plan or fails in 13 Table of Contents any material respect to implement an acceptable compliance plan, the banking regulator must issue an order directing action to correct the deficiency and may issue an order directing other actions of the types to which an undercapitalized institution may be subject under the FDIA.
If, after being so notified, an institution fails to submit an acceptable compliance plan or fails in any material respect to implement an acceptable compliance plan, the banking regulator must issue an order directing action to correct the deficiency and may issue an order directing other actions of the types to which an undercapitalized institution may be subject under the FDIA.
Regulatory authorities have imposed cease and desist orders and significant civil money penalties against institutions found to be violating these obligations and have in some cases brought criminal actions against some institutions for these types of violations. On January 1, 2021, the U.S.
Regulatory authorities have imposed cease and 16 Table of Contents desist orders and significant civil money penalties against institutions found to be violating these obligations and have in some cases brought criminal actions against some institutions for these types of violations. On January 1, 2021, the U.S.
Our bank received a rating of "Satisfactory" in its most recently completed CRA examination during March of 2023. On October 24, 2023, the Office of the Comptroller of the Currency, the FDIC and the FRB jointly issued a final rule to revise the CRA’s implementing regulations.
Our bank received a rating of "Satisfactory" in its most recently completed CRA examination during March of 2023. 15 Table of Contents On October 24, 2023, the Office of the Comptroller of the Currency, the FDIC and the FRB jointly issued a final rule to revise the CRA’s implementing regulations.
In the CRE Guidance, the federal banking regulators (i) 15 Table of Contents expressed concerns with institutions that ease commercial real estate underwriting standards, (ii) directed financial institutions to maintain underwriting discipline and exercise risk management practices to identify, measure and monitor lending risks and (iii) indicated that they will continue to pay special attention to commercial real estate lending activities and concentrations going forward.
In the CRE Guidance, the federal banking regulators (i) expressed concerns with institutions that ease commercial real estate underwriting standards, (ii) directed financial institutions to maintain underwriting discipline and exercise risk management practices to identify, measure and monitor lending risks and (iii) indicated that they will continue to pay special attention to commercial real estate lending activities and concentrations going forward.
("Inland Bancorp"), and Inland Bancorp's wholly owned bank subsidiary, Inland Bank and Trust, an Illinois chartered bank (collectively "Inland acquisition" or "acquisition of Inland"). Refer to Note 3 — Acquisition of a Business contained within Part II, Item 8, Notes to the Consolidated Financial Statements of this document.
("Inland Bancorp"), and Inland Bancorp's wholly-owned bank subsidiary, Inland Bank and Trust, an Illinois chartered bank (collectively "Inland acquisition" or "acquisition of Inland"). Refer to Note 3 — Acquisition of a Business contained within Part II, Item 8, Notes to the Consolidated Financial Statements of this document. First Security Bancorp, Inc.
To facilitate talent attraction, development and retention across our franchise, we strive to make Byline a diverse, inclusive, safe and healthy workplace, with opportunities for our employees to grow and develop in their careers, supported by strong compensation, benefits, and health and welfare programs.
To facilitate talent attraction, development and retention across our franchise, we strive to make Byline an inclusive, safe and healthy workplace, with opportunities for our employees to grow and develop in their careers, supported by strong compensation, benefits, and health and welfare programs.
Risks and exposures related to cybersecurity attacks are expected to remain high for the foreseeable future due to the rapidly evolving nature and sophistication of these threats, as well as due to the expanding use of internet banking, mobile banking and other technology-based products and services by us and our customers. Future Legislation and Regulation The U.S.
Risks and exposures related to cybersecurity attacks are expected to remain high for the foreseeable future due to the rapidly evolving nature and sophistication of these threats, as well as due to the expanding use of internet banking, mobile banking and other technology-based products and services by us and our customers.
Transactions with Affiliates and Insiders Transactions between our bank and its subsidiaries, on the one hand, and us or any other subsidiary, on the other hand, are regulated under Sections 23A and 23B of the Federal Reserve Act.
Transactions with Affiliates and Insiders Transactions between our bank and its subsidiaries, on the one hand, and us or any other subsidiary, on the other hand, are regulated under Sections 23A and 23B of the Federal Reserve Act and the FRB’s Regulation W.
Neither of these final versions of the LCR apply to us or our bank. On October 20, 2020, federal banking regulators also approved a final rule implementing the NSFR that requires certain U.S. banking organizations to ensure that they have access to stable funding over a defined time period.
Neither of these final versions of the LCR apply to us or our bank. Federal banking regulators also approved a final rule implementing the NSFR that requires certain U.S. banking organizations to ensure that they have access to stable funding over a defined time period.
We employed this strategy extensively following our recapitalization by leveraging our relationships with local, regional and national lenders as we developed our own lending capabilities and had excess liquidity. Now, with developed lending capabilities, our participation in syndications has decreased and represents a smaller portion of our portfolio.
We employed this strategy extensively following our recapitalization by leveraging our relationships with local, regional and national lenders as we developed our own lending capabilities and had excess liquidity. Now, given our sophisticated, full-service lending capabilities, our participation in syndications has decreased and represents a smaller portion of our portfolio.
The rule also addresses the CFPB’s approach to privacy interests and the publication of section 1071 data, shielding certain demographic data from underwriters and other persons, recordkeeping requirements and enforcement provisions.
The rule also addresses the CFPB’s approach to privacy interests and the publication of section 1071 data, shielding certain demographic data from underwriters and other persons, record-keeping requirements and enforcement provisions.
Nicolas Mando, 52, became Senior Vice President and Chief Technology and Operations Officer of Byline Bank in November 2021. He served as Director of Special Projects of Byline Bank since 2019. Prior to that, Mr. Mando served as Chief Operating Officer at Bridgeview Bank since 2009.
Nicolas Mando, 53, became Executive Vice President and Chief Technology and Operations Officer of Byline Bank in November 2021. He served as Director of Special Projects of Byline Bank since 2019. Prior to that, Mr. Mando served as Chief Operating Officer at Bridgeview Bank since 2009.
Our Products and Services We are a full service, commercial bank offering a broad range of deposit products and lending services to small and medium sized businesses, commercial real estate and financial sponsors, and consumers around our 47 branch locations in the Chicago metropolitan area and one branch in Wauwatosa, Wisconsin. The products and services we offer are described below.
Our Products and Services We are a full service, commercial bank offering a broad range of deposit products and lending services to small and medium sized businesses, commercial real estate and financial sponsors, and consumers around our 45 branch locations in the Chicago metropolitan area and one branch in Wauwatosa, Wisconsin.
The syndications group targets transactions in the home mortgage, CRE, and C&I categories that provide attractive risk/reward characteristics, and we continue to maintain the ability to sell loan positions to manage credit and specific customer and industry concentrations. As of December 31, 2023, the group had $385.7 million in loan syndications outstanding. Commercial deposits and treasury management .
The syndications group targets transactions in the home mortgage, CRE, and C&I categories that provide attractive risk/reward characteristics, and we continue to maintain the ability to sell loan positions to manage credit and specific customer and industry concentrations. As of December 31, 2024, the group had $246.9 million in loan syndications outstanding. Commercial deposits and treasury management .
Information About Our Executive Officers The following list sets forth the name, current age, principal position and recent business experience of each of our executive officers: 18 Table of Contents Thomas Abraham, 58, became President of Byline Bank’s Small Business Capital ("SBC") line of business in May 2019. Mr.
Information About Our Executive Officers The following list sets forth the name, current age, principal position and recent business experience of each of our executive officers: Thomas Abraham, 59, became President of Byline Bank’s Small Business Capital ("SBC") line of business in May 2019. Mr.
Dana Rose, 54, became Executive Vice President and Chief Human Resources Officer of Byline Bank in November 2019. Prior to that, Ms. Rose served as Interim Chief Human Resources Officer for Discover Financial Services and held various other roles at Discover since 1994.
Dana Rose, 55, became Executive Vice President and Chief Human Resources Officer of Byline Bank in November 2019. Prior to that, Ms. Rose served as Interim Chief Human Resources Officer for Discover Financial Services and held various other roles at Discover since 1994. 19 Table of Contents
In addition to the business development officers who we rely on to generate new business, we also have a dedicated servicing, portfolio management and workout staff with specialized expertise in U.S. government guaranteed loans. As of December 31, 2023, total loans and leases included the guaranteed amount of U.S. government guaranteed loans of $93.3 million.
In addition to the business development officers who we rely on to generate new business, we also have a dedicated servicing, portfolio management and workout staff with specialized expertise in U.S. government guaranteed loans. As of December 31, 2024, total loans and leases included the guaranteed amount of U.S. government guaranteed loans of $97.6 million.
We support the acquisition, recapitalization and growth investment efforts of private equity firms operating in the lower middle market, and we believe our expertise in this niche is unique for a bank our size. As of December 31, 2023, we had $658.9 million in sponsor finance loans outstanding. Syndications .
We support the acquisition, recapitalization and growth investment efforts of private equity firms operating in the lower middle market, and we believe our expertise in this niche is unique for a bank our size. As of December 31, 2024, we had $690.2 million in sponsor finance loans outstanding. Syndications .
We strive to retain an attractive deposit mix from both large and small customers as well as a broad market reach, which has resulted in our top 50 customers accounting for approximately 10.3% of all deposits as of December 31, 2023.
We strive to retain an attractive deposit mix from both large and small customers as well as a broad market reach, which has resulted in our top 50 customers accounting for approximately 12.2% of all deposits as of December 31, 2024.
As part of the adoption of Accounting Standards Update ("ASU") 2016-13, the Company has elected to opt into the regulators’ joint current expected credit losses ("CECL") transition provision, which allows the Company to phase in the capital impact of the adoption of CECL over the next three years beginning January 1, 2022.
As part of the adoption of Accounting Standards Update ("ASU") 2016-13, the Company elected to opt into the regulators’ joint current expected credit losses ("CECL") transition provision, which allowed the Company and Byline Bank to phase in the capital impact of the adoption of CECL over three years beginning January 1, 2022.
Commercial Real Estate Guidance In December 2015, the federal banking regulators released a statement entitled "Interagency Statement on Prudent Risk Management for Commercial Real Estate Lending" (the "CRE Guidance").
Commercial Real Estate Guidance The federal banking regulators previously released a statement entitled "Interagency Statement on Prudent Risk Management for Commercial Real Estate Lending" (the "CRE Guidance").
Small businesses are a significant source of low-cost deposits and represent opportunities for future growth. We believe our small business customers value our ability to provide convenience and access to local, responsive decision makers. As of December 31, 2023, commercial deposits accounted for 46.5% of total deposits and were 77.5% of non-interest bearing deposits.
Small businesses are a significant source of low-cost deposits and represent opportunities for future growth. We believe our small business customers value our ability to provide convenience and access to local, responsive decision makers. As of December 31, 2024, commercial deposits accounted for 45.0% of total deposits and were 80.8% of non-interest bearing deposits.
Commercial banking Commercial banking is a fundamental component of our business. We define commercial banking as lending to small and medium sized businesses, real estate and financial sponsors. We offer a comprehensive range of commercial loan, deposit and treasury management products. Our primary commercial lending groups are described below: Commercial & Industrial .
The products and services we offer are described below. 5 Table of Contents Commercial banking Commercial banking is a fundamental component of our business. We define commercial banking as lending to small and medium sized businesses, real estate and financial sponsors. We offer a comprehensive range of commercial loan, deposit and treasury management products.
As of December 31, 2023, core deposits represented 87.0% of our total deposits. In addition to these products, we offer ATM and debit cards as well as online, mobile, and text banking.
As of December 31, 2024, core deposits represented 85.9% of our total deposits. In addition to these products, we offer ATM and debit cards as well as online, mobile, and text banking.
This rule provides that FinCEN may disclose BOI to an authorized financial institution provided that such institution has developed and implemented administrative, technical and physical safeguards reasonably designed to protect the information and has received the relevant reporting company’s consent to such disclosure.
This rule provides that FinCEN may disclose BOI to an authorized financial institution provided that such institution has developed and implemented administrative, technical and physical safeguards reasonably designed to protect the information and has received the relevant reporting company’s consent to such disclosure. The second final rule is effective as of February 20, 2024.
We seek to leverage our current diverse workforce and prominent community outreach efforts to further define and enhance our DEI focus in four key areas: • Workforce – Promoting representation at all levels and in all areas and business lines of the Bank, with attention on recruiting and developing diverse talent and focusing on engagement and employee recognition. • Workplace – Creating a culture where everyone brings their authentic self to work and knows that their unique background, ethnicity, experiences, perspective, and contribution serve to strengthen the Bank. • Community – Building meaningful, supportive relationships in the communities we work. • Marketplace – Providing greater accessibility to banking products, services, and education to minority owned small businesses ("SMB") and SMBs in low-and moderate-income areas.
We seek to leverage our current workforce and prominent community outreach efforts to further define and enhance our engagement in four key areas: • Workforce – Promoting representation at all levels and in all areas and business lines of the Bank, with attention on recruiting, developing, and retaining high performing talent and focusing on engagement and employee recognition. • Workplace – Creating a culture where everyone brings their authentic self to work and knows their unique background, ethnicity, experiences, perspective, and contribution serve to strengthen the Bank. • Community – Building meaningful, supportive relationships in the communities we work. • Marketplace – Providing greater accessibility to banking products, services, and education to minority owned small businesses ("SMB") and SMBs in low-and moderate-income areas. 7 Table of Contents Our employee resource groups were formed to support development, engagement and inclusion across the organization, and are open to all employees.
Under these restrictions, Byline Bank could pay aggregate dividends of approximately $206.7 million to us without obtaining affirmative regulatory approvals as of December 31, 2023.
Under these restrictions, Byline Bank could pay aggregate dividends of approximately $270.0 million to us without obtaining affirmative regulatory approvals as of December 31, 2024.
Abraham previously served as Senior Vice President, SBA Sales Manager of SBC since October 2016. John M. Barkidjija, 60, became Executive Vice President and Head of Commercial Real Estate and Specialty Finance of Byline Bank in January 2019. Mr. Barkidjija previously served as Senior Vice President, Group Head, Commercial Real Estate of Byline Bank since January 2014. Thomas J.
Abraham previously served as Senior Vice President, SBA Sales Manager of SBC since October 2016. 18 Table of Contents John M. Barkidjija, 61, became Executive Vice President and Head of Commercial Real Estate and Specialty Finance of Byline Bank in January 2019. Mr.
On December 21, 2023, FinCEN finalized the second of the three proposed rules which allows for FinCEN, upon request, to disclose BOI to a statutorily defined group of governmental authorities and financial institutions.
Byline will continue to monitor the status of the BOI rule going forward. On December 21, 2023, FinCEN finalized the second of the three proposed rules which allows for FinCEN, upon request, to disclose BOI to a statutorily defined group of governmental authorities and financial institutions.
The minimum DIF reserve ratio is 1.35% of estimated insured deposits. Under the FDIA, the FDIC may terminate deposit insurance upon a finding that an institution has engaged in unsafe and unsound practices, is in an unsafe or unsound condition to continue operations or has violated any applicable law, regulation, rule, order or condition imposed by the FDIC.
Under the FDIA, the FDIC may terminate deposit insurance upon a finding that an institution has engaged in unsafe and unsound practices, is in an unsafe or unsound condition to continue operations or has violated any applicable law, regulation, rule, order or condition imposed by the FDIC.
Mark Fucinato, 67, became Executive Vice President and Chief Credit Officer for Byline and Byline Bank in August 2020. He previously served as Senior Vice President and Senior Credit Officer of Byline Bank since August 2019. Prior to that, Mr. Fucinato served as Senior Credit Officer at MB Financial Bank from 2016 to 2019. Roberto R.
He previously served as Senior Vice President and Senior Credit Officer of Byline Bank since August 2019. Prior to that, Mr. Fucinato served as Senior Credit Officer at MB Financial Bank from 2016 to 2019. Roberto R.
We have also enhanced our product and lending capabilities with the addition of experienced lending teams hired from larger banks.
We have continued to enhance our product and lending capabilities with the addition of experienced lending teams hired from larger banks.
Byline Bank was the fifth most active originator of SBA loans in the country and the most active SBA lender in Illinois, and Wisconsin, as reported by the SBA for the fiscal year ended September 30, 2023.
Byline Bank was the twelfth most active originator of SBA loans in the country and the most active SBA lender in Illinois, as reported by the SBA its the fiscal year ended September 30, 2024.
The Volcker Rule The Dodd-Frank Act, pursuant to a statutory provision commonly called the "Volcker Rule," prohibits banks and their affiliates from engaging in proprietary trading and investing in and sponsoring hedge funds and private equity funds. The Volcker Rule became effective in July 2015.
The amount of the assessment is calculated on the basis of Byline Bank’s total assets. The Volcker Rule The Dodd-Frank Act, pursuant to a statutory provision commonly called the "Volcker Rule," prohibits banks and their affiliates from engaging in proprietary trading and investing in and sponsoring hedge funds and private equity funds. The Volcker Rule became effective in July 2015.
Our sponsor finance group provides senior secured financing solutions to private equity backed lower middle market companies throughout the U.S. with earnings before interest, tax, depreciation and amortization generally between $2.0 million and $10.0 million.
As of December 31, 2024, the CRE group had $1.2 billion in loans outstanding. Sponsor finance . Our sponsor finance group provides senior secured financing solutions to private equity backed lower middle market companies throughout the U.S. with earnings before interest, tax, depreciation and amortization generally between $2.0 million and $10.0 million.
Strategic growth As part of our strategic growth plan, we explore potential opportunities for expansion in our primary and adjacent market areas through organic growth and the acquisition of financial institutions, branches, and non-banking organizations. Organic Growth We believe our local presence and our scale are essential to the continued growth of our deposit base.
Strategic plan As part of our strategic plan, we explore potential opportunities for expansion in our primary and adjacent market areas through organic growth and the acquisition of financial institutions, branches, and non-banking organizations.
The severity of these mandatory and discretionary supervisory actions depends upon the capital category in which the institution is placed. The relevant capital measures, which reflect changes under the Capital Rules that became effective on January 1, 2015, are the total capital ratio, the CET1 capital ratio, the Tier 1 capital ratio and the leverage ratio.
The severity of these mandatory and discretionary supervisory actions depends upon the capital category in which the institution is placed. The relevant capital measures are the total capital ratio, the CET1 capital ratio, the Tier 1 capital ratio and the leverage ratio.
As of December 31, 2023, we had consolidated total assets of $8.9 billion, total gross loans and leases outstanding of $6.7 billion, total deposits of $7.2 billion, and total stockholders’ equity of $990.2 million.
As of December 31, 2024, we had consolidated total assets of $9.5 billion, total gross loans and leases outstanding of $6.9 billion, total deposits of $7.5 billion, and total stockholders’ equity of $1.1 billion.
The Capital Rules also include a standardized approach for risk weightings of assets that include more risk-sensitive categories compared to previous capital rules.
The Capital Rules also include a standardized approach for risk weightings of assets that include more risk-sensitive categories compared to previous capital rules. Higher levels of capital are required for asset categories perceived to present greater risk.
Federal law also limits our bank’s authority to extend credit to its insiders, which is defined under applicable law to include its directors, executive officers and 10% stockholders, as well as to entities controlled by such persons, or their immediate family members as defined under the regulation.
Sections 22(g) and 22(h) of the Federal Reserve Act also limit our bank’s authority to extend credit to its insiders, which is defined under applicable law to include its directors, executive officers and owners of 10% or more of its stock, as well as to entities controlled by such persons, or their immediate family members as defined under the FRB’s Regulation O.
A financial institution is also expected to develop appropriate processes to enable recovery of data and business operations and address rebuilding network capabilities and restoring data if the institution or its critical service providers fall victim to this type of cyberattack. If we fail to observe the regulatory guidance, we could be subject to various regulatory sanctions, including financial penalties.
A financial institution is also expected to 17 Table of Contents develop appropriate processes to enable recovery of data and business operations and address rebuilding network capabilities and restoring data if the institution or its critical service providers fall victim to this type of cyberattack.
The second final rule is effective as of February 20, 2024. 17 Table of Contents Office of Foreign Assets Control Regulation OFAC, under authority of various laws, administers and enforces economic and trade sanctions against targeted foreign countries and regimes, including designated foreign countries, nationals and others. OFAC publishes lists of specially designated targets and countries.
Office of Foreign Assets Control Regulation OFAC, under authority of various laws, administers and enforces economic and trade sanctions against targeted foreign countries and regimes, including designated foreign countries, nationals and others. OFAC publishes lists of specially designated targets and countries.
Bank holding companies such as us who had less than $15 billion in 11 Table of Contents assets as of December 31, 2009 (and who continue to have less than $15 billion in assets) are permitted to include qualifying trust preferred securities issued prior to May 19, 2010 as Additional Tier 1 capital under the Capital Rules, however.
Bank holding companies such as us who had less than $15 billion in assets as of December 31, 2009 (and who continue to have less than $15 billion in assets) are permitted to include qualifying trust preferred securities issued prior to May 19, 2010 as Additional Tier 1 capital under the Capital Rules, however. 10 Table of Contents In addition, under the general risk-based Capital Rules, the effects of accumulated other comprehensive income items included in capital were excluded for the purposes of determining regulatory capital ratios.
Since our recapitalization in June 2013, our branch network has been reduced from 88 to 48, including 23 branches added through acquisition. During 2023, we added 10 branches within our network as part of our acquisition of Inland. In the first quarter of 2024, we announced plans to consolidate two branches during the second quarter of 2024.
Since our recapitalization in June 2013, our branch network has been reduced from 88 to 46, including 23 branches added through acquisition. During the second quarter of 2024 we consolidated two branches.
We have not elected to be treated as a financial holding company and currently have no plans to make a financial holding company election. 9 Table of Contents The FRB has the power to order any bank holding company or any of its subsidiaries to terminate any activity or to terminate its ownership or control of any subsidiary when the FRB has reasonable grounds to believe that continuing such activity, ownership or control constitutes a serious risk to the financial soundness, safety or stability of any bank subsidiary of the bank holding company.
The FRB has the power to order any bank holding company or any of its subsidiaries to terminate any activity or to terminate its ownership or control of any subsidiary when the FRB has reasonable grounds to believe that continuing such activity, ownership or control constitutes a serious risk to the financial soundness, safety or stability of any bank subsidiary of the bank holding company.
We leverage our expansive branch locations and deep network of customer relationships in the Chicago metropolitan area to provide both low cost funding sources for our lending business and deposit related fee income. We had $7.2 billion of deposits at December 31, 2023, and our average cost of deposits was 1.90% for the year ended December 31, 2023.
We leverage our expansive branch locations and deep network of customer relationships in the Chicago metropolitan area to provide both low cost funding sources for our lending business and deposit related fee income.
It could also result in increased costs related to regulatory oversight, supervision and examination, additional remediation efforts and possible penalties. The Dodd-Frank Act does not prevent states from adopting stricter consumer protection standards. State regulation of financial products and potential enforcement actions could also adversely affect our business, financial condition or results of operations.
It could also result in increased costs related to regulatory oversight, supervision and examination, additional remediation efforts and possible penalties. The Dodd-Frank Act does not prevent states from adopting stricter consumer protection standards.
We expect these consolidations to generate approximately $1.1 million of annual cost savings and anticipate a one-time charge of $1.5 million. We plan to continue to leverage our seasoned management team, the attractive market opportunity in the Chicago metropolitan area, our diversified lending approach and our track record of successfully integrating acquisitions to drive future growth.
We plan to continue to leverage our seasoned management team, the attractive market opportunity in the Chicago metropolitan area, our diversified lending approach and our track record of successfully integrating acquisitions to drive future growth.
In addition, failure to implement or maintain adequate compliance programs could cause banking regulators not to approve an acquisition where regulatory approval is required or to prohibit an acquisition even if approval is not required. Dividends We are a legal entity separate and distinct from Byline Bank and other subsidiaries.
In addition, failure to implement or maintain adequate compliance programs could cause banking regulators not to approve an acquisition where regulatory approval is required or to prohibit an acquisition even if approval is not required.
Accordingly, capital ratios as of December 31, 2023 reflect 50% of the CECL impact, and capital ratios as of December 31, 2022 reflect 25% of the CECL impact. Liquidity Regulations Historically, the regulation and monitoring of bank and bank holding company liquidity has been addressed as a supervisory matter, without required formulaic measures.
Liquidity Regulations Historically, the regulation and monitoring of bank and bank holding company liquidity has been addressed as a supervisory matter, without required formulaic measures.
Accordingly, as of January 1, 2023, the total base assessment rate range, which does not include the depository institution debt adjustment, for institutions of Byline Bank’s size is 2.5 basis points to 32 basis points. The limit on FDIC deposit insurance is $250,000. The coverage limit is per depositor, per insured depository institution for each account ownership category.
Accordingly, as of January 1, 2024, the total base assessment rate range, which does not include the depository institution debt adjustment, for institutions of Byline Bank’s size is 2.5 basis points to 32 basis points. Deposit accounts at our bank are insured up to the maximum of $250,000.
As an institution with less than $10 billion in assets, our bank’s assessment rates are based on the level of risk it poses to the FDIC’s deposit insurance fund (the "DIF").
Deposits are insured up to applicable limits by the FDIC and such insurance is backed by the full faith and credit of the U.S. government. As an institution with less than $10 billion in assets, our bank’s assessment rates are based on the level of risk it poses to the FDIC’s deposit insurance fund (the "DIF").
Anti-Money Laundering and the USA PATRIOT Act A major focus of governmental policy on financial institutions in recent years has been combating money laundering and terrorist financing.
These regulations affect how consumer information is transmitted through diversified financial companies and conveyed to outside vendors. Anti-Money Laundering and the USA PATRIOT Act A major focus of governmental policy on financial institutions in recent years has been combating money laundering and terrorist financing.
As of December 31, 2023, our Company was considered "well capitalized" with a Tier 1 capital ratio of 11.39%, total capital ratio of 13.38%, Tier 1 leverage ratio of 10.86%, and a CET1 capital ratio of 10.35%, as calculated under Basel III.
As of December 31, 2024, our bank was considered "well capitalized" with a Tier 1 capital ratio of 12.94%, total capital ratio of 14.07%, Tier 1 leverage ratio of 11.92%, and a CET1 capital ratio of 12.94%, as calculated under Basel III.
These services are provided through credentialed investment, legal, tax, and wealth management professionals who identify opportunities and provide services tailored to our customers’ goals and objectives. Assets under administration were $770.5 million as of December 31, 2023.
These services are provided through credentialed investment, legal, tax, and wealth management professionals who identify opportunities and provide services tailored to our customers’ goals and objectives. Assets under administration were $746.5 million as of December 31, 2024, and include $119.7 million of money market demand accounts included in interest-bearing deposits on the Consolidated Statements of Financial Condition.
Our #1 core value, reflected in our "Things That Matter," is our People, all of whom are encouraged to live out a shared purpose of making people’s lives better, helping businesses thrive, and strengthening the communities we serve. We believe purpose driven leadership facilitates progress in achieving a diverse and inclusive workforce and in driving performance.
Our #1 core value, reflected in our "Things That Matter," is our People, all of whom are encouraged to live out a shared purpose of making people’s lives better, helping businesses thrive, and strengthening the communities we serve. We are dedicated to attracting, retaining, and developing top talent to accomplish our long-term strategy which is critical to our success.
The end users (i.e., our lessees and borrowers) are primarily manufacturers, retailers, wholesalers, physician group practices and other healthcare related entities. The average lease size at origination for BFG for the year ended December 31, 2023 was approximately $75,000. Our sales team originates leases throughout the country, and we have lessees in nearly every state.
The vertical markets served by our equipment vendors specialize primarily in manufacturing, small equipment construction, wholesalers, and healthcare. The end users (i.e., our lessees and borrowers) are primarily manufacturers, retailers, wholesalers, physician group practices and other healthcare related entities. The average lease size at origination for BFG for the year ended December 31, 2024 was approximately $77,000.
Ability-To-Pay Rules and Qualified Mortgages As required by the Dodd-Frank Act, the CFPB issued a series of final rules amending Regulation Z, implementing the TILA, which requires mortgage lenders to make a reasonable and good faith determination, based on verified and documented information, that a consumer applying for a residential mortgage loan has a reasonable ability to repay the loan according to its terms.
These rules requires mortgage lenders to make a reasonable and good faith determination, based on verified and documented information, that a consumer applying for a residential mortgage loan has a reasonable ability to repay the loan according to its terms.
In November 2021, the federal regulators finalized a rule concerning notification requirements for banks related to significant computer security incidents.
If we fail to observe the regulatory guidance, we could be subject to various regulatory sanctions, including financial penalties. In November 2021, the federal regulators finalized a rule concerning notification requirements for banks related to significant computer security incidents.
As a bank holding company, we are subject to certain restrictions on our ability to pay dividends under applicable banking laws and regulations.
Dividends We are a legal entity separate and distinct from Byline Bank and other subsidiaries. As a bank holding company, we are subject to certain restrictions on our ability to pay dividends under applicable banking laws and regulations. As a Delaware corporation, we are subject to the limitations of the Delaware General Corporation Law (the "DGCL").

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeGenerally, we sell the guaranteed portion of our SBA 7(a) loans in the secondary market. These sales result in premium income for us at the time of sale and create a stream of future servicing income, as we retain the servicing rights to these loans.
Biggest changeThese sales result in premium income for us at the time of sale and create a stream of future servicing income, as we retain the servicing rights to these loans. For the reasons described above, we may not be able to continue originating these loans or sell them in the secondary market.
Our earnings and cash flows are largely dependent on net interest income, which is the difference between the interest income that we earn on interest-earning assets, such as investment securities, loans, and leases, the interest expense that we pay on interest-bearing liabilities, such as deposits and borrowings.
Our earnings and cash flows are largely dependent on net interest income, which is the difference between the interest income that we earn on interest-earning assets, such as investment securities, loans and leases, and the interest expense that we pay on interest-bearing liabilities, such as deposits and borrowings.
Our growth requires that we increase our loan and deposit growth while managing risks by following prudent loan underwriting standards without increasing interest rate risk or compressing our net interest margin, maintaining more than adequate capital at all times, hiring and retaining qualified employees, and successfully implementing strategic projects and initiatives.
Our growth requires that we increase our loan and deposit growth while managing risks by following prudent credit underwriting standards without increasing interest rate risk or compressing our net interest margin, maintaining more than adequate capital at all times, hiring and retaining qualified employees, and successfully implementing strategic projects and initiatives.
For example, our business is subject to the Gramm-Leach-Bliley Act which, among other things: (i) imposes certain limitations on our ability to share nonpublic personal information about our customers with nonaffiliated third parties; (ii) requires that we provide certain disclosures to customers about our information collection, sharing and security practices, and (iii) requires that we develop, implement and maintain a written comprehensive information security program.
For example, our business is subject to the requirements of the Gramm-Leach-Bliley Act which, among other things: (i) imposes certain limitations on our ability to share nonpublic personal information about our customers with nonaffiliated third parties; (ii) requires that we provide certain disclosures to customers about our information collection, sharing and security practices, and (iii) requires that we develop, implement and maintain a written comprehensive information security program.
In the event Byline Bank is unable to pay dividends to us, we may not be able to service our existing debt or any debt we may incur, pay obligations or pay dividends on our common and preferred stock, which could have a material adverse effect on our business, financial condition or results of operations.
In the event Byline Bank is unable to pay dividends to us, we may not be able to service our existing debt or any debt we may incur, pay obligations or pay dividends on our common stock, which could have a material adverse effect on our business, financial condition or results of operations.
The weakening of these standards for any reason, a lack of discipline or diligence in underwriting and monitoring loans and leases, the inability to adequately adapt policies and procedures to changes in economic or any other conditions affecting borrowers and the quality of our loan and lease portfolio, may result in defaults, foreclosures 19 Table of Contents and additional charge-offs and may necessitate that we significantly increase our allowance for credit losses - loans and leases, each of which could adversely affect our net income.
The weakening of these standards for any reason, a lack of discipline or diligence in underwriting and monitoring loans and leases, the inability to adequately adapt policies and procedures to changes in economic or any other conditions affecting borrowers and the quality of our loan and lease portfolio, may result in defaults, foreclosures and additional charge-offs and may necessitate that we significantly increase our allowance for credit losses - loans and leases, each of which could adversely affect our net income.
The value of the financial instruments we own may decline in the future. As of December 31, 2023, we owned $1.4 billion of investment securities, which consisted primarily of our positions in U.S. government and government-sponsored enterprises and federal agency obligations, mortgage and asset-backed securities and municipal securities.
The value of the financial instruments we own may decline in the future. As of December 31, 2024, we owned $1.4 billion of investment securities, which consisted primarily of our positions in U.S. government and government-sponsored enterprises and federal agency obligations, mortgage and asset-backed securities and municipal securities.
If sustained or repeated, a system failure or service denial could result in a deterioration of our ability to operate effectively or service our customers, resulting in potential noncompliance with applicable laws or regulations, loss of customer business, and/or subject us to additional regulatory scrutiny and possible financial liability, any of which could have a material adverse effect on our financial condition.
If sustained or repeated, a system failure or service denial could result in a deterioration of our ability to operate effectively or service our customers, resulting in potential noncompliance with applicable laws or regulations, loss of customer business, and/or subject us to additional regulatory scrutiny and possible financial liability, any of 23 Table of Contents which could have a material adverse effect on our financial condition.
Failure to successfully keep pace with technological change affecting the financial services industry and failure to avoid interruptions, errors, and delays could have a material adverse effect on our business, financial condition, or results of operations. 24 Table of Contents Guaranteed Loans Risks Small Business Administration lending and other government guaranteed lending is an important part of our business.
Failure to successfully keep pace with technological change affecting the financial services industry and failure to avoid interruptions, errors, and delays could have a material adverse effect on our business, financial condition, or results of operations. Guaranteed Loans Risks Small Business Administration lending and other government guaranteed lending is an important part of our business.
Failure to successfully manage these risks in the development and implementation of new lines of business or offerings of new products, product enhancements or services could have a material adverse effect on our business, financial condition, or results of operations. External Risks Our business may be adversely affected by conditions in the financial markets and economic conditions generally.
Failure to successfully manage these risks in the development and implementation of new lines of business or offerings of new products, product enhancements or services could have a material adverse effect on our business, financial condition, or results of operations. 22 Table of Contents External Risks Our business may be adversely affected by conditions in the financial markets and economic conditions generally.
Depending on the condition of any 28 Table of Contents institution or assets or liabilities that we may acquire, that acquisition may, at least in the near term, adversely affect our capital and earnings and, if not successfully integrated with our organization, may continue to have such effects over a longer period.
Depending on the condition of any institution or assets or liabilities that we may acquire, that acquisition may, at least in the near term, adversely affect our capital and earnings and, if not successfully integrated with our organization, may continue to have such effects over a longer period.
From time to time, we may implement new lines of business or offer new products and product enhancements as well as new services within our existing lines of business. There are substantial risks and uncertainties associated with these efforts, particularly in 22 Table of Contents instances in which the markets are not fully developed.
From time to time, we may implement new lines of business or offer new products and product enhancements as well as new services within our existing lines of business. There are substantial risks and uncertainties associated with these efforts, particularly in instances in which the markets are not fully developed.
Therefore, any change in general market interest rates can have a significant effect on our net interest income and results of operations. We seek to mitigate our interest rate risk by entering into interest rate swaps and other interest rate derivative contracts from time to time with counterparties.
Therefore, any change in general market interest rates can have a significant effect on our net interest income and results of operations. 20 Table of Contents We seek to mitigate our interest rate risk by entering into interest rate swaps and other interest rate derivative contracts from time to time with counterparties.
Our failure to effectively mitigate these risks could have a material adverse effect on our business, financial condition, or results of operations. 23 Table of Contents Technology Risks We depend on information technology and telecommunications systems of third parties, and any systems failures, interruptions, or data breaches involving these systems could adversely affect our operations and financial condition.
Our failure to effectively mitigate these risks could have a material adverse effect on our business, financial condition, or results of operations. Technology Risks We depend on information technology and telecommunications systems of third parties, and any systems failures, interruptions, or data breaches involving these systems could adversely affect our operations and financial condition.
Any of these could have a material adverse effect on our business, financial condition, or results of operations. Our goodwill may become impaired, which may adversely impact our results of operations and financial condition and may limit Byline Bank’s ability to pay dividends to us, thereby causing liquidity issues.
Any of these could have a material adverse effect on our business, financial condition, or results of operations. 25 Table of Contents Our goodwill may become impaired, which may adversely impact our results of operations and financial condition and may limit Byline Bank’s ability to pay dividends to us, thereby causing liquidity issues.
Sales or distributions of substantial amounts of our common stock (including shares issued in connection with an acquisition), or the perception that such sales could occur, may cause the market price of our common stock to decline. 29 Table of Contents Item 1B. Unresolved Staff Comments . None
Sales or distributions of substantial amounts of our common stock (including shares issued in connection with an acquisition), or the perception that such sales could occur, may cause the market price of our common stock to decline. Item 1B. Unresolved Staff Comments . None
Currently, our principal stockholder, MBG Investors I, L.P., owns approximately 27.0% of the outstanding shares of our common stock and its general partner is one of our directors. As a result, MBG Investors I, L.P. is able to influence matters requiring approval by our stockholders, including the election of directors and the approval of mergers or other extraordinary transactions.
Currently, our principal stockholder, MBG Investors I, L.P., owns approximately 26.6% of the outstanding shares of our common stock and its general partner is one of our directors. As a result, MBG Investors I, L.P. is able to influence matters requiring approval by our stockholders, including the election of directors and the approval of mergers or other extraordinary transactions.
Furthermore, if we fail to offer interest rates at a sufficient level to keep these demand 20 Table of Contents deposits, our core deposits may be reduced, which would require us to obtain funding in other ways or risk slowing our future asset growth.
Furthermore, if we fail to offer interest rates at a sufficient level to keep these demand deposits, our core deposits may be reduced, which would require us to obtain funding in other ways or risk slowing our future asset growth.
Because of the uncertainty of estimates involved in these matters, we may be required to do one or more of the following: significantly increase the allowance for credit losses - loans and leases or sustain loan and lease losses that are significantly higher than the reserve provided; reduce the carrying value of an asset measured at fair value; or significantly increase our accrued tax liability.
Because of the uncertainty of estimates involved in these matters, we may be required to do one or more of the following: significantly increase the allowance for credit losses or sustain credit losses that are significantly higher than the reserve provided; reduce the carrying value of an asset measured at fair value; or significantly increase our accrued tax liability.
In addition, further increases in market interest rates may continue to affect the market value of our securities portfolio, potentially further reducing accumulated other comprehensive income and/or earnings. 21 Table of Contents Funding Risks A lack of liquidity could affect operations and jeopardize our business, financial condition, and results of operations.
In addition, increases in market interest rates may affect the market value of our securities portfolio, potentially reducing accumulated other comprehensive income and/or earnings. Funding Risks A lack of liquidity could affect operations and jeopardize our business, financial condition, and results of operations.
In addition, any default by the U.S. government on its obligations or any prolonged government shutdown could impede our ability to originate SBA loans or other government guaranteed loans or sell such loans in the secondary market, which could materially adversely affect our business, results of operations, and financial condition.
In addition, any default by the U.S. government on its obligations or any prolonged government shutdown could impede our ability to originate SBA loans or other government guaranteed loans or sell such loans in the secondary market, which could materially adversely affect our business, results of operations, and financial condition. 24 Table of Contents Generally, we sell the guaranteed portion of our SBA 7(a) loans in the secondary market.
If we were to fail to comply with any of these restrictions, we could be subject to enforcement and other legal actions by the FRB, including civil and criminal penalties, which could have a material adverse effect on our business, financial condition and results of operations.
If we were to fail to comply with any of these restrictions, we could be subject to enforcement and other legal actions by the FRB, including civil and criminal penalties, which could have a material adverse effect on our business, financial condition and results of operations. 26 Table of Contents Monetary policies and regulations of the FRB could adversely affect our business, financial condition, and results of operations.
In the event that we continue to pursue further acquisitions, we may have difficulty executing on and may not realize the anticipated benefits of any transaction we complete. Any of the foregoing matters could materially and adversely affect us.
In the event that we continue to pursue further acquisitions, we may have difficulty executing on and may not realize the anticipated benefits of any transaction we complete. Any of the foregoing matters could materially and adversely affect our business, financial condition, or results of operations.
As a result, an allowance for credit losses is determined at the acquisition date using the same methodology as other loans held for investment and is recognized as a provision for credit losses in the consolidated statements of operations.
As a result, an allowance for credit losses is determined at the acquisition date using the same methodology as other loans held for investment and is recognized as a provision for credit losses in the consolidated statements of operations. Any subsequent deterioration (improvement) in credit quality is recognized by recording a provision (recapture) for credit losses.
In addition, while the arbitration provisions in certain of our customer agreements historically have limited our exposure to consumer class action litigation, there can be no assurance that we will be successful in enforcing our arbitration clause in the future.
In addition, while the arbitration provisions in certain of our customer agreements historically have limited our exposure to consumer class action litigation, there can be no assurance that we will be successful in enforcing our arbitration clause in the future. Further, we have in the past and may in the future be subject to consent orders with our regulators.
In some cases, management must select the accounting policy or method to apply from two or more alternatives, any of which may be reasonable under the circumstances, yet which may result in our reporting materially different results than would have been reported under a different alternative. 25 Table of Contents Certain accounting policies and estimates are critical to presenting our financial condition and results of operations.
In some cases, management must select the accounting policy or method to apply from two or more alternatives, any of which may be reasonable under the circumstances, yet which may result in our reporting materially different results than would have been reported under a different alternative.
As the competition for funding among banks increases, and customers move money to achieve higher yields, we may need to increase our deposit pricing accordingly. To the extent we offer higher interest rates on targeted interest-bearing deposit products to maintain current customers or attract new customers, our interest expense will increase, perhaps materially.
As the competition for funding among banks remains high, and customers continue to seek higher yields, we have adjusted our deposit pricing accordingly. To the extent we offer higher interest rates on targeted interest-bearing deposit products to maintain current customers or attract new customers, our interest expense may increase, perhaps materially.
We recognize the expected future tax benefit from deferred tax assets when it is more likely than not that the tax benefit will be realized. Otherwise, a valuation allowance is applied against deferred tax assets, reducing the value of such assets.
Our ability to recognize the benefits of deferred tax assets is dependent on future cash flows and taxable income. We recognize the expected future tax benefit from deferred tax assets when it is more likely than not that the tax benefit will be realized. Otherwise, a valuation allowance is applied against deferred tax assets, reducing the value of such assets.
Monetary policies and regulations of the FRB could adversely affect our business, financial condition, and results of operations. In addition to being affected by general economic conditions, our earnings and growth are affected by the policies of the FRB. An important function of the FRB is to regulate the money supply and credit conditions.
In addition to being affected by general economic conditions, our earnings and growth are affected by the policies of the FRB. An important function of the FRB is to regulate the money supply and credit conditions.
Further, we have in the past and may in the future be subject to consent orders with our regulators. 27 Table of Contents We may also, from time to time, be the subject of subpoenas, requests for information, reviews, investigations and proceedings (both formal and informal) by governmental agencies regarding our current and/or prior business activities.
We may also, from time to time, be the subject of subpoenas, requests for information, reviews, investigations and proceedings (both formal and informal) by governmental agencies regarding our current and/or prior business activities.
As of December 31, 2023, we had goodwill of $181.7 million, or 18.4% of our total stockholders’ equity.
As of December 31, 2024, we had goodwill of $181.7 million, or 16.6% of our total stockholders’ equity.
As of December 31, 2023, our real estate loans held for investment include $525.7 million of construction and development loans, $399.3 million of multifamily loans, $1.0 billion of non-owner occupied CRE loans and $320.2 million of residential mortgage loans, with the majority of these real estate loans concentrated in the Chicago metropolitan area and the State of Illinois.
As of December 31, 2024, our real estate loans held for investment include $489.3 million of construction and development loans, $429.9 million of multifamily loans, $975.6 million of non-owner occupied CRE loans and $296.2 million of residential mortgage loans, with the majority of these real estate loans concentrated in the Chicago metropolitan area and the State of Illinois.
We cannot predict the effects of these changes on our business and profitability. Because government regulation greatly affects the business and financial results of all commercial banks and bank holding companies and especially our organization, changes in the laws, regulations and procedures applicable to government guaranteed loans could adversely affect our ability to operate profitably.
Because government regulation greatly affects the business and financial results of all commercial banks and bank holding companies and especially our organization, changes in the laws, regulations and procedures applicable to government guaranteed loans could adversely affect our ability to operate profitably. The recognition of gains on the sale of loans and servicing asset valuations reflect certain assumptions.
The recognition of gains on the sale of loans and servicing asset valuations reflect certain assumptions. We continue to expect that gains on the sale of U.S. government guaranteed loans will continue to comprise a significant component of our revenue. The gain on such sales recognized for year ended December 31, 2023 was $22.8 million.
We continue to expect that gains on the sale of U.S. government guaranteed loans will continue to comprise a significant component of our revenue. The gain on such sales recognized for year ended December 31, 2024 was $24.5 million.
Our inability to overcome these risks could have a material adverse effect on our profitability, return on equity, return on assets, and our ability to implement our business strategy and enhance stockholder value, which, in turn, could have a material adverse effect on our business, financial condition, and results of operations.
Our inability to overcome these risks could have a material adverse effect on our profitability, return on equity, return on assets, and our ability to implement our business strategy and enhance stockholder value, which, in turn, could have a material adverse effect on our business, financial condition, and results of operations. 28 Table of Contents General Risk Factors Loss of deposits could increase our funding costs and negatively affect our liquidity.
They require management to make difficult, subjective or complex judgments about matters that are uncertain. Materially different amounts could be reported under different conditions or using different assumptions or estimates.
Certain accounting policies and estimates are critical to presenting our financial condition and results of operations. They require management to make difficult, subjective or complex judgments about matters that are uncertain. Materially different amounts could be reported under different conditions or using different assumptions or estimates.
Failure to maintain and implement adequate programs to combat money laundering and terrorist financing could also have serious reputational consequences for us, which could have a material adverse effect on our business, financial condition or results of operations.
Failure to maintain and implement adequate programs to combat money laundering and terrorist financing could also have serious reputational consequences for us, which could have a material adverse effect on our business, financial condition or results of operations. 27 Table of Contents Regulations relating to privacy, information security, and data protection could increase our costs, affect or limit how we collect and use personal information, and adversely affect our business opportunities.
Regulations relating to privacy, information security, and data protection could increase our costs, affect or limit how we collect and use personal information, and adversely affect our business opportunities. We are subject to various privacy, information security, and data protection laws, including requirements concerning security breach notification, and we could be negatively affected by these laws.
We are subject to various privacy, information security, and data protection laws, including requirements concerning security breach notification, and we could be negatively affected by these laws.
Generally, we do not maintain reserves or loss allowances for such potential claims and any such claims could materially adversely affect our business, financial condition, or results of operations. The laws, regulations and standard operating procedures that are applicable to government guaranteed loan products may change in the future.
Generally, we do not maintain reserves or loss allowances for such potential claims and any such claims could materially adversely affect our business, financial condition, or results of operations.
As of December 31, 2023, we had $1.9 billion of non-interest-bearing demand deposits and $577.6 million of interest-bearing checking accounts. As the Federal Reserve raised its overnight target rate, we have cautiously managed our deposit repricing strategies to seek to expand our net interest margin by keeping deposit rates at relatively low levels.
As of December 31, 2024, we had $1.8 billion of non-interest-bearing demand deposits and $767.8 million of interest-bearing checking accounts. As the Federal Reserve has moderated the decline of the overnight target rate, we continue to cautiously manage our deposit repricing strategies to seek to maintain our net interest margin.
Other primary sources of funds consist of cash from operations and investment maturities, redemptions, and sales, as well as borrowings from the Federal Reserve Bank of Chicago, the FHLB and other third-party lenders from time to time.
This loss would require us to seek other funding alternatives in order to continue to grow, thereby increasing our funding costs and reducing our net interest income and net income. 21 Table of Contents Other primary sources of funds consist of cash from operations and investment maturities, redemptions, and sales, as well as borrowings from the Federal Reserve Bank of Chicago, the FHLB and other third-party lenders from time to time.
As of December 31, 2023, Byline Bank had the capacity to pay us dividends of up to $206.7 million without the need to obtain prior regulatory approval. Also, our right to participate in a distribution of assets upon a subsidiary’s liquidation or reorganization is subject to the prior claims of the subsidiary’s creditors.
As of December 31, 2024, Byline Bank had the capacity to pay us dividends of up to $270.0 million without the need to obtain prior regulatory approval.
We accept deposits directly from consumer and commercial customers and, as of December 31, 2023, we had $7.2 billion in deposits.
We rely on customer deposits to meet a considerable portion of our funding needs, and we continue to seek customer deposits to maintain this funding base. We accept deposits directly from consumer and commercial customers and, as of December 31, 2024, we had $7.5 billion in deposits.
Removed
We may be adversely impacted by the continuing transition from the London Interbank Offered Rate ("LIBOR") as a reference rate. On March 5, 2021, the United Kingdom’s Financial Conduct Authority and the Intercontinental Exchange Benchmark Administration announced that the one-week and two-month U.S. dollar LIBOR ("USD LIBOR") settings would cease to be published immediately after December 31, 2021.
Added
The laws, regulations and standard operating procedures that are applicable to government guaranteed loan products may change in the future, particularly in light of the changes being made and scrutiny being given to government funded programs under the new U.S. presidential administration. We cannot predict the effects of these changes on our business and profitability.
Removed
The publication of overnight and one-, three-, six‑, and 12-month USD LIBOR settings would be extended through June 30, 2023 to provide additional time for market participants to wind down or modify existing contracts that reference these LIBOR tenors.
Added
There is uncertainty surrounding the potential legal, regulatory and policy changes by the presidential administration in the United States that may directly affect financial institutions and the global economy.
Removed
In response, the FDIC, the Board of Governors of the Federal Reserve System, and the OCC issued joint guidance directing banks and market participants to cease entering new LIBOR contracts after December 31, 2021, which we have done.
Added
We anticipate that the current presidential administration may seek to implement a regulatory reform agenda that may be significantly different from that of the previous administration impacting rulemaking, supervision, examination and enforcement priorities of the federal banking agencies.
Removed
Although most LIBOR tenors continued to be published through June 30, 2023 to aid in the transition of legacy LIBOR contracts (e.g., maturity), as of January 1, 2021, we no longer originate loans indexed to LIBOR nor enter into modifications which create new LIBOR exposure.
Added
Changes in federal policy and at regulatory agencies are expected to occur over time through policy and personnel changes, which could lead to changes involving the level of oversight and focus on the financial services industry. The nature, timing and economic and political effects of potential changes to the current legal and regulatory framework affecting financial institutions remain highly uncertain.
Removed
During 2021, we began a transition to using a forward-looking term rate based upon the Secured the Overnight Financing Rate ("SOFR"), CME Term SOFR ("Term SOFR") as the replacement benchmark index in lieu of LIBOR. SOFR is the Alternative Reference Rates Committee’s recommended alternative to USD LIBOR.
Added
At this time, it is unclear what additional laws, regulations and policies may change and whether future changes or uncertainty surrounding future changes will adversely affect our operating environment and therefore our business, financial condition and results of operations.
Removed
Because the Term SOFR market continues to develop and deepen, changes in SOFR or Term SOFR or changes in market perceptions of the acceptability of Term SOFR as a benchmark could result in changes to our risk exposures (for example, because SOFR is a broad measurement of the cost borrowing cash secured by U.S.
Removed
Treasury securities, changes or disruptions in the repo market may adversely affect the availability or cost of floating-rate funding and, therefore, our exposure to fluctuations in interest rates) or otherwise result in losses on a product or having to pay more or receive less on financial instruments that we own or have issued.
Removed
Uncertainty as to the nature of other alternative reference rates and their broader acceptance by the market may also adversely affect SOFR rates and the value of SOFR-based loans, and to a lesser extent securities in our portfolio, and may impact the availability and cost of hedging instruments and borrowings, including the rates we pay on our subordinated debentures and trust preferred securities.
Removed
This loss would require us to seek other funding alternatives in order to continue to grow, thereby increasing our funding costs and reducing our net interest income and net income.
Removed
For the reasons described above, we may not be able to continue originating these loans or sell them in the secondary market.
Removed
Any subsequent deterioration (improvement) in credit quality is recognized by recording a provision (recapture) for credit losses. 26 Table of Contents Our ability to recognize the benefits of deferred tax assets is dependent on future cash flows and taxable income.
Removed
General Risk Factors Loss of deposits could increase our funding costs and negatively affect our liquidity. We rely on customer deposits to meet a considerable portion of our funding needs, and we continue to seek customer deposits to maintain this funding base.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

7 edited+0 added−0 removed11 unchanged
Biggest changeWe regularly train employees on the importance of protecting our information, and communicate with our customers and employees on the importance to protect information and enhancing cybersecurity through security campaigns, newsletters, posters and ad-hoc communications. If specific threats are identified, management may communicate those threats directly to employees for heightened awareness.
Biggest changeWe regularly train employees on the importance of protecting our information, and also regularly communicate with our customers and employees. If specific threats are identified, management may communicate those threats directly to employees for heightened awareness.
While to-date we have not experienced a significant cybersecurity incident, significant data loss or any material financial losses related to cybersecurity attacks on our systems and those of our customers and third-party service providers are under constant threat, and it is possible that we could experience an incident in the future that could have a material adverse effect on our business strategy, results of operations and financial condition.
While to-date we have not experienced a material cybersecurity incident, significant data loss or any material financial losses related to cybersecurity attacks on our systems and those of our customers and third-party service providers , we are under constant threat, and it is possible that we could experience an incident in the future that could have a material adverse effect on our business strategy, results of operations and financial condition.
The Program, which is administered by our Chief Risk Officer, includes policies and procedures that identify how security measures and controls are developed, implemented, maintained and assessed. Governance As part of our ERM, our Board of Directors reviews and approves the Program on an annual basis.
The Program, which is administered by our Chief Risk Officer, includes policies and procedures that identify how security measures and controls are developed, implemented, maintained and assessed. Governance As part of our Risk Governance, our Board of Directors reviews and approves the Program on an annual basis.
As described above, we utilize a risk-based approach and judgment to determine the security controls to implement and it is possible we may not implement appropriate controls if we do not recognize or underestimate a particular risk. In 30 Table of Contents addition, security controls, no matter how well designed or implemented, may only mitigate, and not fully eliminate risks.
As described above, we utilize a risk-based approach and judgment to determine the security controls to implement and it is possible we may not implement appropriate controls if we do not recognize or underestimate a particular risk. In addition, security controls, no matter how well designed or implemented, may only mitigate, and not fully eliminate risks.
The Board oversees efforts to develop, implement, and maintain an effective Information Security Program, including reviewing management’s reporting on Program effectiveness. In addition to a Privacy and Security Governance Committee, we also have Governance, Risk, Information Technology and Compliance functions that monitor and address enterprise risks, including cybersecurity risks.
The Board oversees efforts to develop, implement, and maintain an effective Information Security Program, including reviewing management’s reporting on Program effectiveness. In addition to Board Oversight, we also have Governance, Risk, Information Technology, Information Security, and Compliance functions that monitor and address enterprise risks, including cybersecurity risks.
Managing Material Risks and Integrated Overall Risk Management We have developed an Information Security Program (the “Program”) as part of our overall risk assessment and Enterprise Risk Management ("ERM") to address material risks from potential cybersecurity threats, as well as to facilitate the governance and oversight of cybersecurity risks.
Managing Material Risks and Integrated Overall Risk Management We have developed an Information Security Program (the “Program”) as part of our overall Enterprise Risk Management ("ERM") framework to address material risks from potential cybersecurity threats, as well as to facilitate the governance and oversight 29 Table of Contents of cybersecurity risks.
And events, when detected by security tools or third parties, may not always be immediately understood or acted upon.
And events, when detected by security tools or third parties, may not always be immediately understood or acted upon. 30 Table of Contents

Item 2. Properties

Properties — owned and leased real estate

2 edited+0 added−0 removed1 unchanged
Biggest changeItem 2. Pr operties . Our corporate headquarters is located at 180 North LaSalle Street, Suite 300, Chicago, IL 60601. In addition to our corporate headquarters, we operate 47 branch offices located in the Chicago metropolitan area and one branch office in Wauwatosa, Wisconsin.
Biggest changeItem 2. Pr operties . Our corporate headquarters is located at 180 North LaSalle Street, Suite 300, Chicago, IL 60601. In addition to our corporate headquarters, we operate 45 branch offices located in the Chicago metropolitan area and one branch office in Wauwatosa, Wisconsin.
We lease 17 of our branch offices and our headquarters and own the remainder of our branch offices.
We lease 14 of our branch offices and our headquarters and own the remainder of our branch offices.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

10 edited+1 added−1 removed6 unchanged
Biggest changeThe program will be in effect from January 1, 2024 until December 31, 2024, unless terminated earlier. The shares may, at the discretion of management, be repurchased from time to time in open market purchases as market conditions warrant or in privately negotiated transactions.
Biggest changeThe shares may, at the discretion of management, be repurchased from time to time in open market purchases as market conditions warrant or in privately negotiated transactions. We are not obligated to purchase any shares under the program, and the program may be discontinued at any time.
"Business – Supervision and Regulations – Dividends" above and Note 20 of notes to consolidated financial statements contained in Item 8 of this report. We paid a cash dividend of $0.09 per share for each quarter of 2022 and 2023. Issuer Purchases of Equity Securities.
"Business – Supervision and Regulations – Dividends" above and Note 20 of notes to consolidated financial statements contained in Item 8 of this report. We paid a cash dividend of $0.09 per share for each quarter of 2023 and 2024. Issuer Purchases of Equity Securities.
Total return assumes the reinvestment of all dividends. * The information assumes that $100 was invested at the closing price on December 31, 2018 in our stock and each index, and that all dividends are reinvested.
Total return assumes the reinvestment of all dividends. * The information assumes that $100 was invested at the closing price on December 31, 2019 in our stock and each index, and that all dividends are reinvested.
The following graph compares the cumulative total stockholder return on our common stock from December 31, 2018 through December 31, 2023, with the cumulative total return of: (1) the Russell 2000 (U.S. Stock) Index, (2) a peer group of the S&P U.S. SmallCap Banks Index and, (3) the KBW NASDAQ Regional Bank Index ("KRX").
The following graph compares the cumulative total stockholder return on our common stock from December 31, 2019 through December 31, 2024, with the cumulative total return of: (1) the Russell 2000 (U.S. Stock) Index, (2) a peer group of the S&P U.S. SmallCap Banks Index and, (3) the KBW NASDAQ Regional Bank Index ("KRX").
The shares authorized to be repurchased represent approximately 2.9% of the Company’s outstanding common stock at December 31, 2023. The table below includes information regarding purchases of our common stock during the quarter ended December 31, 2023. We did not purchase any shares of our common stock during the fourth quarter of 2023 under our stock repurchase program.
The shares authorized to be repurchased represent approximately 2.8% of the Company’s outstanding common stock at December 31, 2024. The table below includes information regarding purchases of our common stock during the quarter ended December 31, 2024. We did not purchase any shares of our common stock during the fourth quarter of 2024 under our stock repurchase program.
We did not purchase any shares of our common stock under the stock repurchase program during 2023. On December 6, 2023, we announced that our Board of Directors approved a new stock repurchase program authorizing the purchase of up to an aggregate of 1,250,000 shares of our outstanding common stock.
On December 6, 2023, we announced that our Board of Directors approved a new stock repurchase program authorizing the purchase of up to an aggregate of 1,250,000 shares of our outstanding common stock.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Our common stock is listed on the NYSE under the symbol "BY". There were approximately 1,132 holders of record of our common stock as of March 1, 2024.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. Our common stock is listed on the NYSE under the symbol "BY". There were approximately 1,455 holders of record of our common stock as of February 18, 2025.
On December 12, 2022, we announced that our Board of Directors approved a new stock repurchase program authorizing the purchase of up to an aggregate of 1,250,000 shares of our outstanding common stock. The program was in effect from January 1, 2023 until December 31, 2023.
On December 5, 2024, we announced that our Board of Directors approved a new stock repurchase program authorizing the purchase of up to an aggregate of 1,250,000 shares of our outstanding common stock. The program will be in effect from January 1, 2025 until December 31, 2025, unless terminated earlier.
Issuer Purchases of Equity Securities Maximum Number of Total Average Total Number of Shares Shares that Number of Price Purchased as Part of a May Yet Be Shares Paid per Publicly Announced Purchased Under the Purchased (1) Share Plan or Program Plan or Program October 1 - October 31, 2023 3,206 $ 19.62 — 1,250,000 November 1 - November 30, 2023 — — — 1,250,000 December 1 - December 31, 2023 15,228 23.56 — 1,250,000 Total 18,434 $ 22.88 — (1) These shares were acquired pursuant to our 2017 Omnibus Incentive Compensation Plan.
Issuer Purchases of Equity Securities Maximum Number of Total Average Total Number of Shares Shares that Number of Price Purchased as Part of a May Yet Be Shares Paid per Publicly Announced Purchased Under the Purchased (1) Share Plan or Program Plan or Program October 1 - October 31, 2024 919 $ 25.66 — 1,250,000 November 1 - November 30, 2024 329 31.45 — 1,250,000 December 1 - December 31, 2024 — — — 1,250,000 Total 1,248 $ 27.19 — (1) These shares were acquired pursuant to our 2017 Omnibus Incentive Compensation Plan.
Index 12/31/2018 12/31/2019 12/31/2020 12/31/2021 12/31/2022 12/31/2023 Byline Bancorp, Inc. $ 100.00 $ 117.65 $ 93.85 $ 168.27 $ 143.47 $ 149.67 Russel 2000 100.00 125.52 150.58 172.90 137.56 160.85 S&P U.S. Small Cap Bank 100.00 125.46 113.94 158.62 139.85 140.55 KRX 100.00 120.38 105.82 140.94 127.62 122.51
Index 12/31/2019 12/31/2020 12/31/2021 12/31/2022 12/31/2023 12/31/2024 Byline Bancorp, Inc. $ 100.00 $ 79.77 $ 143.03 $ 121.94 $ 127.22 $ 158.95 Russel 2000 100.00 119.96 137.74 109.59 128.14 142.93 S&P U.S. Small Cap Bank 100.00 90.82 126.43 111.47 112.03 132.44 KRX 100.00 87.90 117.08 106.01 101.77 111.52
Removed
We are not obligated to purchase any shares under the program, and the program may be discontinued at any time.
Added
The program was in effect from January 1, 2024 until December 31, 2024, and we did not purchase any shares of our common stock under the stock repurchase program during 2024.

Item 6. [Reserved]

Selected Financial Data — reserved (removed by SEC in 2021)

129 edited+39 added−17 removed85 unchanged
Biggest changeAs of December 31, 2023, approximately $34.4 million of the ACL was allocated to unguaranteed loans in our government lending portfolio. 52 Table of Contents The following table presents an analysis of the allowance for credit losses - loans and leases for the periods presented (dollars in thousands): Commercial Real Estate Residential Real Estate Construction, Land Development, and Other Land Commercial and Industrial Installment and Other Lease Financing Receivables Total Balance at December 31, 2022 $ 26,061 $ 3,140 $ 3,134 $ 41,889 $ 24 $ 7,676 $ 81,924 Adjustment for acquired PCD loans 8,230 660 97 1,609 — — 10,596 Provision for PCD loans (1,319 ) (432 ) 101 414 (1 ) — (1,237 ) Provision for acquired non-credit-deteriorated loans (1,666 ) 340 606 181 1 (31 ) (569 ) Provision for originated loans 10,222 (310 ) (1,032 ) 22,807 11 2,328 34,026 Total provision $ 7,237 $ (402 ) $ (325 ) $ 23,402 $ 11 $ 2,297 $ 32,220 Charge-offs for PCD loans (1,229 ) — — — — — (1,229 ) Charge-offs for acquired non-credit deteriorated loans — — — — — — — Charge-offs for originated loans (8,500 ) (21 ) — (15,411 ) (3 ) (2,437 ) (26,372 ) Total charge-offs $ (9,729 ) $ (21 ) $ — $ (15,411 ) $ (3 ) $ (2,437 ) $ (27,601 ) Recoveries for PCD loans — — — — — — — Recoveries for acquired non-credit deteriorated loans — — — — — — — Recoveries for originated loans 1,438 118 — 2,293 4 694 4,547 Total recoveries $ 1,438 $ 118 $ — $ 2,293 $ 4 $ 694 $ 4,547 Net charge-offs (recoveries) (8,291 ) 97 — (13,118 ) 1 (1,743 ) (23,054 ) Balance at December 31, 2023 $ 33,237 $ 3,495 $ 2,906 $ 53,782 $ 36 $ 8,230 $ 101,686 Ending ACL balances PCD loans $ 6,833 $ 902 $ 211 $ 2,069 $ 1 $ — $ 10,016 Acquired non-credit-deteriorated loans 2,070 636 607 1,410 2 3 4,728 Originated loans 24,334 1,957 2,088 50,303 33 8,227 86,942 Balance at December 31, 2023 $ 33,237 $ 3,495 $ 2,906 $ 53,782 $ 36 $ 8,230 $ 101,686 Loans individually evaluated for impairment $ 12,361 $ — $ — $ 14,880 $ — $ — $ 27,241 Loans collectively evaluated for impairment 20,876 3,495 2,906 38,902 36 8,230 74,445 Balance at December 31, 2023 $ 33,237 $ 3,495 $ 2,906 $ 53,782 $ 36 $ 8,230 $ 101,686 Loans and leases ending balances Loans individually evaluated for impairment $ 64,339 $ 3,593.00 $ 813.00 $ 44,749 $ — $ — $ 113,494 Loans collectively evaluated for impairment 2,255,973 715,937 526,024 2,403,812 3,200 665,866 6,570,812 Total loans at December 31, 2023, gross $ 2,320,312 $ 719,530 $ 526,837 $ 2,448,561 $ 3,200 $ 665,866 $ 6,684,306 Ratio of net charge-offs to average loans outstanding during the year PCD loans 0.02 % 0.00 % 0.00 % 0.00 % 0.00 % 0.00 % 0.02 % Acquired non-credit-deteriorated loans 0.00 % 0.00 % 0.00 % 0.00 % 0.00 % 0.00 % 0.00 % Originated loans 0.12 % 0.00 % 0.00 % 0.22 % 0.00 % 0.02 % 0.36 % Loans ending balance as a percentage of total loans, gross Loans individually evaluated for impairment 0.96 % 0.05 % 0.01 % 0.67 % 0.00 % 0.00 % 1.70 % Loans collectively evaluated for impairment 33.75 % 10.70 % 7.87 % 35.96 % 0.05 % 9.96 % 98.30 % Total 34.71 % 10.75 % 7.88 % 36.63 % 0.05 % 9.96 % 100.00 % 53 Table of Contents Commercial Real Estate Residential Real Estate Construction, Land Development, and Other Land Commercial and Industrial Installment and Other Lease Financing Receivables Total Balance at December 31, 2021 $ 16,918 $ 1,628 $ 522 $ 33,129 $ 9 $ 2,806 $ 55,012 Impact of Adopting CECL - PCD (303 ) 353 120 (207 ) — — (37 ) Impact of Adopting CECL - Non-credit-deteriorated 1,909 124 — (279 ) 1 39 1,794 Impact of Adopting CECL - Originated 4,761 570 1,071 1,739 8 2,262 10,411 Total impact Day 1 CECL adoption $ 6,367 $ 1,047 $ 1,191 $ 1,253 $ 9 $ 2,301 $ 12,168 Provision for PCD loans (753 ) (495 ) (56 ) (281 ) (18 ) — (1,603 ) Provision for acquired non-credit-deteriorated loans (1,517 ) 321 1 (1,243 ) (1 ) (282 ) (2,721 ) Provision for originated loans 7,522 1,082 1,530 13,526 10 3,328 26,998 Total provision $ 5,252 $ 908 $ 1,475 $ 12,002 $ (9 ) $ 3,046 $ 22,674 Charge-offs for PCD loans (195 ) (945 ) (94 ) (7 ) (4 ) — (1,245 ) Charge-offs for acquired non-credit deteriorated loans (6 ) (174 ) — (72 ) — (28 ) (280 ) Charge-offs for originated loans (3,634 ) (90 ) — (5,299 ) (3 ) (1,444 ) (10,470 ) Total charge-offs $ (3,835 ) $ (1,209 ) $ (94 ) $ (5,378 ) $ (7 ) $ (1,472 ) $ (11,995 ) Recoveries for PCD loans 592 755 40 177 22 — 1,586 Recoveries for acquired non-credit deteriorated loans — — — — — 257 257 Recoveries for originated loans 768 11 — 705 — 738 2,222 Total recoveries $ 1,360 $ 766 $ 40 $ 882 $ 22 $ 995 $ 4,065 Net charge-offs (recoveries) (2,475 ) (443 ) (54 ) (4,496 ) 15 (477 ) (7,930 ) Balance at December 31, 2022 $ 26,062 $ 3,140 $ 3,134 $ 41,888 $ 24 $ 7,676 $ 81,924 Ending ACL Balances PCD loans $ 1,151 $ 674 $ 13 $ 46 $ 2 $ — $ 1,886 Acquired non-credit-deteriorated loans 3,736 296 1 1,229 1 34 5,297 Originated loans 21,175 2,170 3,120 40,613 21 7,642 74,741 Balance at December 31, 2022 $ 26,062 $ 3,140 $ 3,134 $ 41,888 $ 24 $ 7,676 $ 81,924 Loans individually evaluated for impairment $ 6,102 $ — $ 265 $ 8,971 $ — $ — $ 15,338 Loans collectively evaluated for impairment 19,960 3,140 2,869 32,917 24 7,676 66,586 Balance at December 31, 2022 $ 26,062 $ 3,140 $ 3,134 $ 41,888 $ 24 $ 7,676 $ 81,924 Loans and leases ending balances Loans individually evaluated for impairment $ 37,959 $ 879 $ 5,541 $ 47,846 $ — $ — $ 92,225 Loans collectively evaluated for impairment 1,871,529 489,083 433,448 2,009,228 1,759 523,986 5,329,033 Total loans at December 31, 2022, gross $ 1,909,488 $ 489,962 $ 438,989 $ 2,057,074 $ 1,759 $ 523,986 $ 5,421,258 Ratio of net charge-offs to average loans outstanding during the year PCD loans (0.01 )% 0.00 % 0.00 % 0.00 % 0.00 % 0.00 % (0.01 )% Acquired non-credit-deteriorated loans 0.00 % 0.00 % 0.00 % 0.00 % 0.00 % 0.00 % 0.00 % Originated loans 0.06 % 0.00 % 0.00 % 0.09 % 0.00 % 0.01 % 0.16 % Loans ending balance as a percentage of total loans, gross Loans individually evaluated for impairment 0.70 % 0.02 % 0.10 % 0.88 % 0.00 % 0.00 % 1.70 % Loans collectively evaluated for impairment 34.52 % 9.01 % 8.00 % 37.06 % 0.03 % 9.67 % 98.30 % Total 35.22 % 9.03 % 8.10 % 37.94 % 0.03 % 9.67 % 100.00 % 54 Table of Contents Non-performing assets Non-performing loans and leases include loans and leases 90 days past due and still accruing and loans and leases accounted for on a non-accrual basis.
Biggest changeThe decreased allocation in commercial real estate was offset by a $2.8 million increase the provision for credit losses on commercial and industrial loans exceeding charge-offs, net of recoveries. 53 Table of Contents The following table presents an analysis of the allowance for credit losses - loans and leases for the periods presented (dollars in thousands): Commercial Real Estate Residential Real Estate Construction, Land Development, and Other Land Commercial and Industrial Installment and Other Lease Financing Receivables Total Balance at December 31, 2023 $ 33,237 $ 3,495 $ 2,906 $ 53,782 $ 36 $ 8,230 $ 101,686 Provision (recapture) for PCD loans (3,466 ) (407 ) (209 ) 649 — — (3,433 ) Recapture for acquired non-credit-deteriorated loans (302 ) (217 ) (290 ) (364 ) (1 ) (2 ) (1,176 ) Provision for originated loans 2,596 37 37 28,564 11 1,650 32,895 Total provision $ (1,172 ) $ (587 ) $ (462 ) $ 28,849 $ 10 $ 1,648 $ 28,286 Charge-offs for PCD loans (74 ) — — (2,513 ) — — (2,587 ) Charge-offs for acquired non-credit deteriorated loans (140 ) — — (58 ) — — (198 ) Charge-offs for originated loans (5,468 ) — — (25,562 ) (1 ) (2,535 ) (33,566 ) Total charge-offs $ (5,682 ) $ — $ — $ (28,133 ) $ (1 ) $ (2,535 ) $ (36,351 ) Recoveries for PCD loans 84 — 1 100 — — 185 Recoveries for acquired non-credit deteriorated loans 32 — — — — — 32 Recoveries for originated loans 1,374 12 — 1,991 — 773 4,150 Total recoveries $ 1,490 $ 12 $ 1 $ 2,091 $ — $ 773 $ 4,367 Net (charge-offs) recoveries (4,192 ) 12 1 (26,042 ) (1 ) (1,762 ) (31,984 ) Balance at December 31, 2024 $ 27,873 $ 2,920 $ 2,445 $ 56,589 $ 45 $ 8,116 $ 97,988 Ending ACL balances PCD loans $ 3,377 $ 495 $ 3 $ 305 $ 1 $ — $ 4,181 Acquired non-credit-deteriorated loans 1,659 419 317 988 1 — 3,384 Originated loans 22,837 2,006 2,125 55,296 43 8,116 90,423 Balance at December 31, 2024 $ 27,873 $ 2,920 $ 2,445 $ 56,589 $ 45 $ 8,116 $ 97,988 Loans individually evaluated for impairment $ 6,853 $ 67 $ — $ 16,649 $ — $ — $ 23,569 Loans collectively evaluated for impairment 21,020 2,853 2,445 39,940 45 8,116 74,419 Balance at December 31, 2024 $ 27,873 $ 2,920 $ 2,445 $ 56,589 $ 45 $ 8,116 $ 97,988 Loans and leases ending balances Loans individually evaluated for impairment $ 36,421 $ 1,365 $ — $ 40,712 $ — $ — $ 78,498 Loans collectively evaluated for impairment 2,317,996 724,737 489,269 2,576,421 3,966 715,935 6,828,324 Total loans at December 31, 2024, gross $ 2,354,417 $ 726,102 $ 489,269 $ 2,617,133 $ 3,966 $ 715,935 $ 6,906,822 Ratio of net charge-offs to average loans outstanding during the year PCD loans 0.00 % 0.00 % 0.00 % 0.04 % 0.00 % 0.00 % 0.04 % Acquired non-credit-deteriorated loans 0.00 % 0.00 % 0.00 % 0.00 % 0.00 % 0.00 % 0.00 % Originated loans 0.05 % 0.00 % 0.00 % 0.35 % 0.00 % 0.03 % 0.43 % Loans ending balance as a percentage of total loans, gross Loans individually evaluated for impairment 0.53 % 0.02 % 0.00 % 0.59 % 0.00 % 0.00 % 1.14 % Loans collectively evaluated for impairment 33.56 % 10.48 % 7.09 % 37.30 % 0.06 % 10.37 % 98.86 % Total 34.09 % 10.50 % 7.09 % 37.89 % 0.06 % 10.37 % 100.00 % 54 Table of Contents Commercial Real Estate Residential Real Estate Construction, Land Development, and Other Land Commercial and Industrial Installment and Other Lease Financing Receivables Total Balance at December 31, 2022 $ 26,061 $ 3,140 $ 3,134 $ 41,889 $ 24 $ 7,676 $ 81,924 Adjustment for acquired PCD loans 8,230 660 97 1,609 — — 10,596 Provision (recapture) for PCD loans (1,319 ) (432 ) 101 414 (1 ) — (1,237 ) Provision (recapture) for acquired non-credit-deteriorated loans (1,666 ) 340 606 181 1 (31 ) (569 ) Provision (recapture) for originated loans 10,222 (310 ) (1,032 ) 22,807 11 2,328 34,026 Total provision $ 7,237 $ (402 ) $ (325 ) $ 23,402 $ 11 $ 2,297 $ 32,220 Charge-offs for PCD loans (1,229 ) — — — — — (1,229 ) Charge-offs for acquired non-credit deteriorated loans — — — — — — — Charge-offs for originated loans (8,500 ) (21 ) — (15,411 ) (3 ) (2,437 ) (26,372 ) Total charge-offs $ (9,729 ) $ (21 ) $ — $ (15,411 ) $ (3 ) $ (2,437 ) $ (27,601 ) Recoveries for PCD loans — — — — — — — Recoveries for acquired non-credit deteriorated loans — — — — — — — Recoveries for originated loans 1,438 118 — 2,293 4 694 4,547 Total recoveries $ 1,438 $ 118 $ — $ 2,293 $ 4 $ 694 $ 4,547 Net (charge-offs) recoveries (8,291 ) 97 — (13,118 ) 1 (1,743 ) (23,054 ) Balance at December 31, 2023 $ 33,237 $ 3,495 $ 2,906 $ 53,782 $ 36 $ 8,230 $ 101,686 Ending ACL balances PCD loans $ 6,833 $ 902 $ 211 $ 2,069 $ 1 $ — $ 10,016 Acquired non-credit-deteriorated loans 2,070 636 607 1,410 2 3 4,728 Originated loans 24,334 1,957 2,088 50,303 33 8,227 86,942 Balance at December 31, 2023 $ 33,237 $ 3,495 $ 2,906 $ 53,782 $ 36 $ 8,230 $ 101,686 Loans individually evaluated for impairment $ 12,361 $ — $ — $ 14,880 $ — $ — $ 27,241 Loans collectively evaluated for impairment 20,876 3,495 2,906 38,902 36 8,230 74,445 Balance at December 31, 2023 $ 33,237 $ 3,495 $ 2,906 $ 53,782 $ 36 $ 8,230 $ 101,686 Loans and leases ending balances Loans individually evaluated for impairment $ 64,339 $ 3,593 $ 813 $ 44,749 $ — $ — $ 113,494 Loans collectively evaluated for impairment 2,255,973 715,937 526,024 2,403,812 3,200 665,866 6,570,812 Total loans at December 31, 2023, gross $ 2,320,312 $ 719,530 $ 526,837 $ 2,448,561 $ 3,200 $ 665,866 $ 6,684,306 Ratio of net charge-offs to average loans outstanding during the year PCD loans 0.02 % 0.00 % 0.00 % 0.00 % 0.00 % 0.00 % 0.02 % Acquired non-credit-deteriorated loans 0.00 % 0.00 % 0.00 % 0.00 % 0.00 % 0.00 % 0.00 % Originated loans 0.12 % 0.00 % 0.00 % 0.22 % 0.00 % 0.02 % 0.36 % Loans ending balance as a percentage of total loans, gross Loans individually evaluated for impairment 0.96 % 0.05 % 0.01 % 0.67 % 0.00 % 0.00 % 1.70 % Loans collectively evaluated for impairment 33.75 % 10.70 % 7.87 % 35.96 % 0.05 % 9.96 % 98.30 % Total 34.71 % 10.75 % 7.88 % 36.63 % 0.05 % 9.96 % 100.00 % 55 Table of Contents Non-performing assets Non-performing loans and leases include loans and leases 90 days past due and still accruing and loans and leases accounted for on a non-accrual basis.
Management believes this metric is important to investors 38 Table of Contents and analysts interested in relative changes in the ratio of total stockholders’ equity to total assets, each exclusive of changes in intangible assets. • "Tangible net income available to common stockholders" is net income available to common stockholders excluding after-tax intangible asset amortization. • "Adjusted tangible net income available to common stockholders" is tangible net income available to common stockholders excluding certain significant items.
Management believes this metric is important 38 Table of Contents to investors and analysts interested in relative changes in the ratio of total stockholders’ equity to total assets, each exclusive of changes in intangible assets. • "Tangible net income available to common stockholders" is net income available to common stockholders excluding after-tax intangible asset amortization. • "Adjusted tangible net income available to common stockholders" is tangible net income available to common stockholders excluding certain significant items.
The growth in the originated loan and lease portfolio was primarily driven by increases in commercial and industrial loans and leases, commercial real estate, and leasing financing receivables, as well as renewals of acquired loans that are now reflected with originated loans.
The growth in the originated loan and lease portfolio was primarily driven by increases in commercial and industrial loans and leases, leasing financing receivables, and commercial real estate, as well as renewals of acquired loans that are now reflected with originated loans.
Management believes this metric is important due to the relative changes in the book value per share exclusive of changes in intangible assets. • "Tangible common equity to tangible assets" is calculated as tangible common equity divided by tangible assets, which is total assets reduced by goodwill and other intangible assets.
Management believes this metric is important due to the relative changes in the book value per share exclusive of changes in intangible assets. • "Tangible common stockholders' equity to tangible assets" is calculated as tangible common equity divided by tangible assets, which is total assets reduced by goodwill and other intangible assets.
We do not intend to sell these securities and it is not more likely than not that we will be required to sell them before recovery of their amortized cost basis, which may be at maturity. 48 Table of Contents The following table (dollars in thousands) set forth certain information regarding contractual maturities and the weighted average yields of our debt securities as of December 31, 2023.
We do not intend to sell these securities and it is not more likely than not that we will be required to sell them before recovery of their amortized cost basis, which may be at maturity. 48 Table of Contents The following table (dollars in thousands) set forth certain information regarding contractual maturities and the weighted average yields of our debt securities as of December 31, 2024.
The following table summarizes certain selected historical consolidated financial data of Byline as of or for the fiscal years ended December 31, 2023, 2022, and 2021, and is derived from our audited financial statements. You should read this information in conjunction with our consolidated financial statements and related notes included in Item 8 of this report.
The following table summarizes certain selected historical consolidated financial data of Byline as of or for the fiscal years ended December 31, 2024, 2023, and 2022, and is derived from our audited financial statements. You should read this information in conjunction with our consolidated financial statements and related notes included in Item 8 of this report.
We did not utilize the discount window during 2023 and there were no borrowings outstanding under the FRB discount window line as of December 31, 2023. We pledge loans as collateral for any borrowings under the FRB discount window. During 2020, we issued $75.0 million in fixed-to-floating subordinated notes that mature on July 1, 2030.
We did not utilize the discount window during 2024 and there were no borrowings outstanding under the FRB discount window line as of December 31, 2024. We pledge loans as collateral for any borrowings under the FRB discount window. During 2020, we issued $75.0 million in fixed-to-floating subordinated notes that mature on July 1, 2030.
We evaluate impairment of our investment in FHLB and Bankers’ Bank based on the ultimate recoverability of the par value rather than by recognizing temporary declines in value. We did not identify any indicators of impairment of FHLB and Bankers’ Bank stock as of December 31, 2023 and 2022.
We evaluate impairment of our investment in FHLB and Bankers’ Bank based on the ultimate recoverability of the par value rather than by recognizing temporary declines in value. We did not identify any indicators of impairment of FHLB and Bankers’ Bank stock as of December 31, 2024 and 2023.
The ratio demonstrates profitability excluding the tax provision or benefit and excludes the provision for credit losses. • "Adjusted pre-tax pre-provision return on average assets" excludes certain significant items, which include impairment charges on assets held for sale and ROU asset and merger-related expenses. • "Tangible common equity" is defined as total stockholders’ equity reduced by preferred stock and goodwill and other intangible assets.
Management believes this ratio demonstrates profitability excluding the tax provision or benefit and excludes the provision for credit losses. • "Adjusted pre-tax pre-provision return on average assets" excludes certain significant items, which include impairment charges on assets held for sale and ROU asset, and merger-related expenses. • "Tangible common stockholders' equity" is defined as total stockholders’ equity reduced by preferred stock and goodwill and other intangible assets.
There were no holdings of securities of any one issuer, other than U.S. government-sponsored entities and agencies, with total outstanding balances greater than 10% of our stockholders’ equity as of December 31, 2023 and 2022.
There were no holdings of securities of any one issuer, other than U.S. government-sponsored entities and agencies, with total outstanding balances greater than 10% of our stockholders’ equity as of December 31, 2024 and 2023.
The metric demonstrates income excluding the tax provision or benefit and the provision for credit losses and enables investors and others to assess our ability to generate capital to cover credit losses through a credit cycle. • "Adjusted pre-tax pre-provision net income" is pre-tax pre-provision net income excluding certain significant items, which include impairment charges on assets held for sale and ROU asset and merger-related expenses.
Management believes this metric demonstrates income excluding the tax provision or benefit and the provision for credit losses and enables investors and others to assess our ability to generate capital to cover credit losses through a credit cycle. • "Adjusted pre-tax pre-provision net income" is pre-tax pre-provision net income excluding certain significant items, which include impairment charges on assets held for sale and ROU asset and merger-related expenses.
Other factors contributing to our results of operations include our provisions for credit losses, provision for income taxes, and non-interest expenses, such as salaries and employee benefits, occupancy and equipment expenses and other miscellaneous operating costs.
Other factors contributing to our results of operations include our provisions for credit losses, provision for income taxes, and non-interest expenses, such as salaries and employee benefits, occupancy and equipment expenses, data processing expenses, and other miscellaneous operating costs.
Maturity as of December 31, 2023 Due in One Year or Less Due from One to Five Years Due from Five to Ten Years Due after Ten Years Amortized Cost Weighted Average Yield (1) Amortized Cost Weighted Average Yield (1) Amortized Cost Weighted Average Yield (1) Amortized Cost Weighted Average Yield (1) Available-for-sale U.S.
Maturity as of December 31, 2024 Due in One Year or Less Due from One to Five Years Due from Five to Ten Years Due after Ten Years Amortized Cost Weighted Average Yield (1) Amortized Cost Weighted Average Yield (1) Amortized Cost Weighted Average Yield (1) Amortized Cost Weighted Average Yield (1) Available-for-sale U.S.
These financial instruments include commitments to extend credit, commercial letters of credit and standby letters of credit. Those instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the 59 Table of Contents Consolidated Statements of Financial Condition.
These financial instruments include commitments to extend credit, commercial letters of credit and standby letters of credit. Those instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the Consolidated Statements of Financial Condition.
Refer to Note 5 of the notes to our audited consolidated financial statements contained in Item 8 of this report for further information. 55 Table of Contents Deposits We gather deposits primarily through each of our 47 branch locations in the Chicago metropolitan area and one branch in Wauwatosa, Wisconsin.
Refer to Note 5 of the notes to our audited consolidated financial statements contained in Item 8 of this report for further information. 56 Table of Contents Deposits We gather deposits primarily through each of our 45 branch locations in the Chicago metropolitan area and one branch in Wauwatosa, Wisconsin.
Please refer to the "GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures" included in Item 7 of this report, for more information on how our adjusted efficiency ratio is calculated. Income Taxes Income tax expense was $37.8 million for the year ended December 31, 2023, compared to $26.7 million for the year ended December 31, 2022.
Please refer to the "GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures" included in Item 7 of this report, for more information on how our adjusted efficiency ratio is calculated. Income Taxes Income tax expense was $40.3 million for the year ended December 31, 2024, compared to $37.8 million for the year ended December 31, 2023.
As of December 31, 2023, purchased credit deteriorated loans accounted for under ASC Topic 326 represented 3.4% of our total loan portfolio, compared to 1.4% at December 31, 2022.
As of December 31, 2024, purchased credit deteriorated loans accounted for under ASC Topic 326 represented 1.8% of our total loan portfolio, compared to 3.4% at December 31, 2023.
There were no securities classified as trading in our investment portfolio as of or for the years ended December 31, 2023 and 2022. All available-for sale securities are carried at fair value and may be used for liquidity purposes should management consider it to be in our best interest.
There were no securities classified as trading in our investment portfolio as of or for the years ended December 31, 2024 and 2023. All available-for sale securities are carried at fair value and may be used for liquidity purposes should 47 Table of Contents management consider it to be in our best interest.
We do not anticipate any material losses as a result of the commitments and standby letters of credit. We enter into interest rate swaps that are used to manage differences in the amount, timing, and duration of our known or expected cash receipts and its known or expected cash payments principally related to certain variable rate borrowings.
We do not anticipate any material losses as a result of the commitments and standby letters of credit. We enter into interest rate swaps that are used to manage differences in the amount, timing, and duration of our known or expected cash receipts and its known or expected cash payments.
Management’s discussion focuses on 2023 results compared to 2022. For a discussion of 2022 results compared to 2021, refer to Part I, Item 7 of our 2022 Annual Report filed on Form 10-K , which was filed with the SEC on March 6, 2023.
Management’s discussion focuses on 2024 results compared to 2023. For a discussion of 2023 results compared to 2022, refer to Part I, Item 7 of our 2023 Annual Report filed on Form 10-K , which was filed with the SEC on March 4, 2024.
Fees included in loan and lease interest income were $9.8 million, $12.1 million, and $27.2 million for the years ended December 31, 2023, 2022 and 2021, respectively. Non-accrual loans and leases are included in total loan and lease balances.
Fees included in loan and lease interest income were $8.1 million, $9.8 million, and $12.1 million for the years ended December 31, 2024, 2023, and 2022, respectively. Non-accrual loans and leases are included in total loan and lease balances.
Our results of operations for the years ended December 31, 2023 and 2022, produced an annual return on average assets of 1.34% and 1.25% and a return on average stockholders’ equity of 12.50% and 11.33%, respectively. Since our recapitalization in June 2013, our branch network has been reduced from 88 to 48, including 23 branches added through acquisition.
Our results of operations for the years ended December 31, 2024 and 2023, produced an annual return on average assets of 1.31% and 1.34% and a return on average stockholders’ equity of 11.61% and 12.50%, respectively. Since our recapitalization in June 2013, our branch network has been reduced from 88 to 46, including 23 branches added through acquisition.
The Company is currently party to a revolving credit agreement with a correspondent bank with availability of up to $15.0 million that matures on May 26, 2024.
The Company is currently party to a revolving credit agreement with a correspondent bank with availability of up to $15.0 million that matures on May 25, 2025.
We sold $348.4 million and $382.2 million of U.S. government guaranteed loans during the years ended December 31, 2023 and 2022, respectively. Wealth management and trust income represents fees charged to customers for investment, trust, or wealth management services and are primarily determined by total assets under administration.
We sold $314.8 million and $348.4 million of U.S. government guaranteed loans during the years ended December 31, 2024 and 2023, respectively. Wealth management and trust income represents fees charged to customers for investment, trust, and wealth management services and are primarily determined by total assets under administration.
Our exposure to certain industries as of December 31, 2023 represents the following percentages of the portfolio: 36.5% real estate, 12.5% manufacturing, 7.7% finance and insurance, 6.4% wholesale trade, 5.0% retail trade, and all other industries represent less than 5% of the portfolio or 31.9% of the total loan and lease portfolio.
Our exposure to certain industries as of December 31, 2024 represents the following percentages of the portfolio: 36.1% real estate, 12.8% manufacturing, 8.7% finance and insurance, 5.9% wholesale trade, 5.0% other services, and all other industries represent less than 5% of the portfolio or 31.4% of the total loan and lease portfolio.
Commitments to make loans are generally made for periods of 90 days or less. The fixed rate loan commitments have interest rates ranging from 1.00% to 15.00% and maturities up to 2053. Variable rate loan commitments have interest rates ranging from 4.00% to 18.50% and maturities up to 2049.
Commitments to make loans are generally made for periods of 90 days or less. The fixed rate loan commitments have interest rates ranging from 1.00% to 15.00% and maturities up to 2052. Variable rate loan commitments have interest rates ranging from 4.00% to 17.75% and maturities up to 2053.
The construction, land development and other land loan portfolio comprised 14.8% and 15.5% of real estate loans as of December 31, 2023 and 2022, respectively, and 7.9% and 8.1% of the total loan and lease portfolio as of December 31, 2023 and 2022, respectively.
The construction, land development and other land loan portfolio comprised 13.7% and 14.8% of real estate loans as of December 31, 2024 and 2023, respectively, and 7.1% and 7.9% of the total loan and lease portfolio as of December 31, 2024 and 2023, respectively.
Commercial real estate loans comprised the largest portion of the real estate loan portfolio as of December 31, 2023 and 2022, and totaled $2.3 billion, or 65.0%, of real estate loans and 34.7% of the total loan and lease portfolio at December 31, 2023.
At December 31, 2023, commercial real estate loans totaled $2.3 billion and comprised 65.0% of real estate loans and 34.7% of the total loan and lease portfolio.
Securities sold under agreements to repurchase were $40.6 million at December 31, 2023, compared to $15.4 million at December 31, 2022 an increase of $25.2 million. 58 Table of Contents Liquidity We manage liquidity based upon factors that include the amount of core deposits as a percentage of total deposits, the level of diversification of our funding sources, the amount of non-deposit funding used to fund assets, the availability of unused funding sources, off-balance sheet obligations, the availability of assets readily converted into cash without undue loss, the amount of cash and liquid securities we hold and the re-pricing characteristics and maturities of our assets when compared to the re-pricing characteristics of our liabilities, the ability to securitize and sell certain pools of assets and other factors.
Securities sold under agreements to repurchase were $32.1 million at December 31, 2024, compared to $40.6 million at December 31, 2023, a decrease of $8.5 million. 59 Table of Contents Liquidity We manage liquidity based upon factors that include the amount of core deposits as a percentage of total deposits, the level of diversification of our funding sources, the amount of non-deposit funding used to fund assets, the availability of unused funding sources, off-balance sheet obligations, the availability of assets readily converted into cash without undue loss, the amount of cash and liquid securities we hold and the re-pricing characteristics and maturities of our assets when compared to the re-pricing characteristics of our liabilities, the ability to securitize and sell certain pools of assets and other factors.
Loan and lease portfolio Lending-related income is the most important component of our net interest income and is the main driver of the results of our operations. Total loans and leases at December 31, 2023 and 2022 were $6.7 billion and $5.4 billion, respectively, an increase of $1.3 billion or 23.3%.
Loan and lease portfolio Lending-related income is the most important component of our net interest income and is the main driver of the results of our operations. Total loans and leases at December 31, 2024 and 2023 were $6.9 billion and $6.7 billion, respectively, an increase of $222.5 million or 3.3%.
In addition, Byline Bank owns stock of Bankers’ Bank, which is redeemable at par and carried at cost. As of December 31, 2023 and 2022, we held $16.3 million and $28.2 million, respectively, in FHLB and Bankers’ Bank stock.
In addition, Byline Bank owns stock of Bankers’ Bank, which is redeemable at par and carried at cost. As of December 31, 2024 and 2023, we held $27.5 million and $16.3 million, respectively, in FHLB and Bankers’ Bank stock.
The following tables summarize the fair value of the available-for-sale and held-to-maturity securities portfolio as of the dates presented (dollars in thousands): December 31, 2023 December 31, 2022 Amortized Cost Fair Value Amortized Cost Fair Value Available-for-sale U.S. Treasury Notes $ 116,398 $ 115,434 $ 42,430 $ 40,723 U.S.
The following tables summarize the fair value of the available-for-sale and held-to-maturity securities portfolio as of the dates presented (dollars in thousands): December 31, 2024 December 31, 2023 Amortized Cost Fair Value Amortized Cost Fair Value Available-for-sale U.S. Treasury Notes $ 32,783 $ 32,570 $ 116,398 $ 115,434 U.S.
Non-performing assets consist of non-performing loans and leases plus other real estate owned. Non-accrual loans and leases as December 31, 2023 and 2022 totaled $64.1 million and $36.0 million, respectively. Non-performing assets consisted of $4.2 million and $2.2 million of U.S. government guaranteed balances at December 31, 2023 and 2022, respectively.
Non-performing assets consist of non-performing loans and leases plus other real estate owned. Non-accrual loans and leases as December 31, 2024 and 2023 totaled $62.1 million and $64.1 million, respectively. Non-accrual loans and leases include $9.9 million and $4.2 million of U.S. government guaranteed balances at December 31, 2024 and 2023, respectively.
The residential real estate loan portfolio comprised 20.2% and 17.3% of real estate loans as of December 31, 2023 and 2022, respectively, and 10.8% and 9.1% of total loans and leases at December 31, 2023 and 2022, respectively.
The residential real estate loan portfolio comprised 20.3% and 20.2% of real estate loans as of December 31, 2024 and 2023, respectively, and 10.4% and 10.8% of total loans and leases at December 31, 2024 and 2023, respectively.
As of December 31, 2022, Byline Bank had open advances from the FHLB of $625.0 million and open letters of credit of $13.5 million, providing available aggregate borrowing capacity of $1.0 billion. In addition, Byline Bank had an uncommitted federal funds line available of $135.0 million at December 31, 2022.
As of December 31, 2023, Byline Bank had open advances from the FHLB of $325.0 million and open letters of credit of $19.7 million, providing available aggregate borrowing capacity of $1.6 billion. In addition, Byline Bank had an uncommitted federal funds line available of $135.0 million at December 31, 2023.
(2) Interest income and rates include the effects of a tax equivalent adjustment to adjust tax-exempt investment income on tax-exempt investment securities to a fully taxable basis, assuming a federal income tax rate of 21%. Net interest income for the year ended December 31, 2023 was $330.6 million, an increase of $65.3 million, or 24.6% compared to 2022.
(2) Interest income and rates include the effects of a tax equivalent adjustment to adjust tax-exempt investment income on tax-exempt investment securities to a fully taxable basis, assuming a federal income tax rate of 21%. Net interest income for the year ended December 31, 2024 was $348.0 million, an increase of $17.4 million, or 5.3% compared to 2023.
The Company and Byline Bank are subject to various regulatory capital requirements administered by federal banking regulators. Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by federal banking regulators that, if undertaken, could have a direct material effect on our financial statements.
Failure to meet minimum capital requirements can initiate certain mandatory and possibly additional discretionary actions by federal banking regulators that, if undertaken, could have a direct material effect on our financial statements.
For the years ended December 31, 2023 and 2022, net income available to common stockholders was $107.9 million, or $2.69 per basic and $2.67 per diluted common share, and $87.8 million, or $2.37 per basic and $2.34 per diluted common share, respectively.
For the years ended December 31, 2024 and 2023, net income available to common stockholders was $120.8 million, or $2.78 per basic and $2.75 per diluted common share, and $107.9 million, or $2.69 per basic and $2.67 per diluted common share, respectively.
The commercial and industrial loan portfolio comprised 36.6% and 37.9% of the total loan and lease portfolio as of December 31, 2023 and 2022, respectively. 50 Table of Contents Lease financing receivables comprised 10.0% and 9.7% of the loan and lease portfolio as of December 31, 2023 and 2022, respectively.
The commercial and industrial loan portfolio comprised 37.9% and 36.6% of the total loan and lease portfolio as of December 31, 2024 and 2023, respectively. Lease financing receivables comprised 10.4% and 10.0% of the total loan and lease portfolio as of December 31, 2024 and 2023, respectively.
At December 31, 2023, fixed-rate advances totaled $75.0 million, with an interest rate of 5.45% and maturity of January 2024. Total variable rate advances were $250.0 million at December 31, 2023, with an interest rate of 5.59% that may reset daily and mature in March 2024. The Company’s required investment in FHLB stock is $4.50 for every $100 in advances.
Total variable rate advances were $250.0 million at December 31, 2024, with an interest rate of 4.51% that may reset daily and mature in March 2025. The Company’s required investment in FHLB stock is $4.50 for every $100 in advances.
Because a portion of the portfolio is accounted for under ASC 326, the carrying value is significantly affected by estimates and it is impracticable to allocate scheduled payments for those loans based on those estimates.
Because a portion of the portfolio is accounted for under ASC 326, the carrying value is significantly affected by estimates and it is impracticable to allocate scheduled payments for those loans based on those estimates. Consequently, the tables presented include information limited to contractual maturities of the underlying loans.
Management uses the non-GAAP financial measures set forth herein in its analysis of our performance and believes that these non-GAAP financial measures provide useful information to management and investors; however, you should not view these disclosures as a substitute for results determined in accordance with GAAP financial measures. 36 Table of Contents As of or for the years ended December 31, (Dollars in thousands except share and per share data) 2023 2022 2021 Income Statement Data Net interest income $ 330,621 $ 265,330 $ 236,387 Provision for credit losses 31,653 23,879 973 Non-interest income 56,315 57,314 74,253 Non-interest expense 209,603 184,082 185,455 Income before income taxes 145,680 114,683 124,212 Provision for income taxes 37,802 26,729 31,427 Net income 107,878 87,954 92,785 Dividends on preferred shares — 196 783 Income available to common stockholders $ 107,878 $ 87,758 $ 92,002 Earnings per Common Share Basic earnings per common share $ 2.69 $ 2.37 $ 2.45 Diluted earnings per common share $ 2.67 $ 2.34 $ 2.40 Adjusted diluted earnings per share (1)(2)(3) $ 2.89 $ 2.36 $ 2.71 Weighted-average common shares outstanding (basic) 40,045,208 36,972,972 37,609,723 Weighted-average common shares outstanding (diluted) 40,445,553 37,476,120 38,369,067 Common shares outstanding 43,764,056 37,492,775 37,713,903 Balance Sheet Data Loans and leases held for investment, before allowance for credit losses - loans and leases (4) $ 6,684,306 $ 5,421,258 $ 4,537,128 Loans and leases held for sale 18,005 47,823 64,460 Allowance for credit losses - loans and leases (ACL) 101,686 81,924 55,012 Acquisition accounting adjustments (5) — 4,769 13,389 Interest-bearing deposits in other banks 165,705 117,079 122,684 Investment securities 1,352,380 1,185,125 1,469,005 Assets held for sale 4,484 8,673 9,153 Other real estate owned, net 1,200 4,717 2,112 Goodwill and other intangibles 203,478 158,887 165,558 Servicing assets 19,844 19,172 23,744 Total assets 8,881,967 7,362,941 6,696,172 Total deposits 7,176,999 5,695,121 5,155,047 Total liabilities 7,891,816 6,597,125 5,859,790 Total stockholders’ equity 990,151 765,816 836,382 Deposits per branch 149,521 149,872 117,160 Book value per common share 22.62 20.43 21.90 Tangible book value per common share (1) 17.98 16.19 17.51 Performance Ratios Net interest margin 4.31 % 4.00 % 3.84 % Net interest margin, fully taxable equivalent (1)(4) 4.32 4.01 3.86 Average cost of deposits 1.90 0.36 0.09 Efficiency ratio (5) 52.62 54.99 57.42 Adjusted efficiency ratio (1)(2)(5) 49.61 54.70 52.14 Non-interest expense to average assets 2.60 2.62 2.79 Adjusted non-interest expense to average assets (1)(2) 2.46 2.61 2.54 Return on average stockholders’ equity 12.50 11.33 11.31 Adjusted return on average stockholders' equity (1)(2)(3) 13.53 11.43 12.77 Return on average assets 1.34 1.25 1.40 Adjusted return on average assets (1)(2)(3) 1.45 1.26 1.58 Non-interest income to total revenues (1) 14.55 17.76 23.90 Pre-tax pre-provision return on average assets (1) 2.20 1.97 1.88 Adjusted pre-tax pre-provision return on average assets (1)(2) 2.35 1.99 2.13 Return on average tangible common stockholders' equity (1) 16.46 15.15 15.17 Adjusted return on average tangible common stockholders' equity (1)(2)(3) 17.76 15.28 17.04 Non-interest-bearing deposits to total deposits 26.56 37.55 41.87 Loans and leases held for sale and loans and leases held for investment to total deposits 93.39 96.03 89.26 Deposits to total liabilities 90.94 86.33 87.97 Asset Quality Ratios Non-performing loans and leases / total loans and leases held for investment, net before ACL 0.96 % 0.66 % 0.51 % ACL / total loans and leases held for investment, net before ACL 1.52 1.51 1.21 Net charge-offs / average total loans and leases held for investment, net before ACL 0.38 0.16 0.28 Capital Ratios Common equity to assets 11.15 % 10.40 % 12.33 % Tangible common equity to tangible assets(1) 9.06 8.42 10.11 Leverage ratio 10.86 10.29 10.89 Common equity tier 1 capital ratio 10.35 10.20 11.39 Tier 1 capital ratio 11.39 10.85 12.37 Total capital ratio 13.38 13.00 14.70 (1) Represents a non-GAAP financial measure.
Management uses the non-GAAP financial measures set forth herein in its analysis of our performance and believes that these non-GAAP financial measures provide useful information to management and investors; however, you should not view these disclosures as a substitute for results determined in accordance with GAAP financial measures. 36 Table of Contents As of or for the years ended December 31, (Dollars in thousands except share and per share data) 2024 2023 2022 Income Statement Data Net interest income $ 348,046 $ 330,621 $ 265,330 Provision for credit losses 27,041 31,653 23,879 Non-interest income 58,851 56,315 57,314 Non-interest expense 218,777 209,603 184,082 Income before income taxes 161,079 145,680 114,683 Provision for income taxes 40,320 37,802 26,729 Net income 120,759 107,878 87,954 Dividends on preferred shares — — 196 Income available to common stockholders $ 120,759 $ 107,878 $ 87,758 Earnings per Common Share Basic earnings per common share $ 2.78 $ 2.69 $ 2.37 Diluted earnings per common share $ 2.75 $ 2.67 $ 2.34 Adjusted diluted earnings per share (1)(2)(3) $ 2.76 $ 2.89 $ 2.36 Weighted-average common shares outstanding (basic) 43,448,856 40,045,208 36,972,972 Weighted-average common shares outstanding (diluted) 43,853,939 40,445,553 37,476,120 Common shares outstanding 44,459,584 43,764,056 37,492,775 Balance Sheet Data Loans and leases held for investment, before allowance for credit losses - loans and leases (4) $ 6,906,822 $ 6,684,306 $ 5,421,258 Loans and leases held for sale 3,200 18,005 47,823 Allowance for credit losses - loans and leases (ACL) 97,988 101,686 81,924 Interest-bearing deposits in other banks 504,379 165,705 117,079 Investment securities 1,426,166 1,352,380 1,185,125 Assets held for sale 2,025 4,484 8,673 Other real estate owned, net 5,170 1,200 4,717 Goodwill and other intangibles 198,098 203,478 158,887 Servicing assets 18,952 19,844 19,172 Total assets 9,496,529 8,881,967 7,362,941 Total deposits 7,458,628 7,176,999 5,695,121 Total liabilities 8,405,032 7,891,816 6,597,125 Total stockholders’ equity 1,091,497 990,151 765,816 Deposits per branch 162,144 149,521 149,872 Book value per common share 24.55 22.62 20.43 Tangible book value per common share (1) 20.09 17.98 16.19 Performance Ratios Net interest margin 3.97 % 4.31 % 4.00 % Net interest margin, fully taxable equivalent (1) 3.98 4.32 4.01 Average cost of deposits 2.61 1.90 0.36 Efficiency ratio (5) 52.45 52.62 54.99 Adjusted efficiency ratio (1)(2)(5) 52.24 49.61 54.70 Non-interest expense to average assets 2.38 2.60 2.62 Adjusted non-interest expense to average assets (1)(2) 2.37 2.46 2.61 Return on average stockholders’ equity 11.61 12.50 11.33 Adjusted return on average stockholders' equity (1)(2)(3) 11.68 13.53 11.43 Return on average assets 1.31 1.34 1.25 Adjusted return on average assets (1)(2)(3) 1.32 1.45 1.26 Non-interest income to total revenues (1) 14.46 14.55 17.76 Pre-tax pre-provision return on average assets (1) 2.05 2.20 1.97 Adjusted pre-tax pre-provision return on average assets (1)(2) 2.06 2.35 1.99 Return on average tangible common stockholders' equity (1) 14.85 16.46 15.15 Adjusted return on average tangible common stockholders' equity (1)(2)(3) 14.94 17.76 15.28 Non-interest-bearing deposits to total deposits 23.54 26.56 37.55 Loans and leases held for sale and loans and leases held for investment to total deposits 92.64 93.39 96.03 Deposits to total liabilities 88.74 90.94 86.33 Asset Quality Ratios Non-performing loans and leases / total loans and leases held for investment, net before ACL 0.90 % 0.96 % 0.66 % Total non-performing assets as a percentage of total assets 0.71 0.74 0.55 ACL / total loans and leases held for investment, net before ACL 1.42 1.52 1.51 Net charge-offs / average total loans and leases held for investment, net before ACL 0.47 0.38 0.16 Capital Ratios Common equity to assets 11.49 % 11.15 % 10.40 % Tangible common equity to tangible assets (1) 9.61 9.06 8.42 Leverage ratio 11.74 10.86 10.29 Common equity tier 1 capital ratio 11.70 10.35 10.20 Tier 1 capital ratio 12.73 11.39 10.85 Total capital ratio 14.74 13.38 13.00 (1) Represents a non-GAAP financial measure.
Total deposits at December 31, 2023 were $7.2 billion, representing an increase of $1.5 billion, or 26.0%, compared to $5.7 billion at December 31, 2022. Non-interest-bearing deposits were $1.9 billion, or 26.6% of total deposits, at December 31, 2023, a decrease of $232.8 million, or 10.9%, compared to $2.1 billion at December 31, 2022, or 37.6% of total deposits.
Total deposits at December 31, 2024 were $7.5 billion, representing an increase of $281.6 million, or 3.9%, compared to $7.2 billion at December 31, 2023. Non-interest-bearing deposits were $1.8 billion, or 23.5% of total deposits, at December 31, 2024, a decrease of $149.8 million, or 7.9%, compared to $1.9 billion at December 31, 2023, or 26.6% of total deposits.
As of December 31, 2023, we had outstanding commitments to extend credit of $2.4 billion, primarily related to unused credit lines and $14.3 million of commitments under operating lease agreements.
As of December 31, 2024, we had outstanding commitments to extend credit of $2.0 billion, primarily related to unused credit lines and $10.9 million of commitments under operating lease agreements.
The increase was primarily a result of increased building maintenance and depreciation due to acquired branches. Equipment expense for the year ended December 31, 2023 was $4.5 million compared to $3.8 million for the year ended December 31, 2022, an increase of $687,000 or 18.1%.
The increase was primarily a result of increased depreciation due to acquired branches and increased building maintenance. Equipment expense for the year ended December 31, 2024 was $4.0 million compared to $4.5 million for the year ended December 31, 2023, a decrease of $461,000 or 10.3%.
As of December 31, 2023, Byline Bank had maximum borrowing capacity from the FHLB of $3.1 billion and $866.5 million from the FRB. As of December 31, 2023, Byline Bank had open advances from the FHLB of $325.0 million and open letters of credit of $19.7 million, providing available aggregate borrowing capacity of $1.6 billion.
As of December 31, 2024, Byline Bank had maximum borrowing capacity from the FHLB of $3.3 billion and $792.3 million from the FRB. As of December 31, 2024, Byline Bank had open advances from the FHLB of $575.0 million and open letters of credit of $11.5 million, providing available aggregate borrowing capacity of $1.1 billion.
The increase in the purchased credit deteriorated and acquired non-credit-deteriorated loan and lease portfolio was driven by loans acquired in the Inland acquisition. 49 Table of Contents We strive to maintain a relatively diversified loan and lease portfolio to help reduce the risk inherent in concentration in certain types of collateral.
The decrease in the purchased credit deteriorated and acquired non-credit-deteriorated loan and lease portfolio was driven by renewals of loans as originated, resolutions of these loans, and charge-offs. 49 Table of Contents We strive to maintain a diversified loan and lease portfolio to help reduce the risk inherent in concentration in certain types of collateral.
The following reconciliation tables provide a more detailed analysis of the non‑GAAP financial measures discussed herein: As of or for the years ended December 31, (dollars in thousands, except per share data) 2023 2022 2021 Net income and earnings per share excluding significant items Reported Net Income $ 107,878 $ 87,954 $ 92,785 Significant items: Impairment charges on assets held for sale and ROU asset 2,395 372 16,430 Merger-related expense 9,222 538 — Tax benefit on impairment charges and merger-related expenses (2,696 ) (118 ) (4,462 ) Adjusted Net Income $ 116,799 $ 88,746 $ 104,753 Reported Diluted Earnings per Share $ 2.67 $ 2.34 $ 2.40 Significant items: Impairment charges on assets held for sale and ROU asset 0.06 0.01 0.43 Merger-related expense 0.23 0.01 — Tax benefit on impairment charges and merger-related expenses (0.07 ) — (0.12 ) Adjusted Diluted Earnings per Share $ 2.89 $ 2.36 $ 2.71 39 Table of Contents As of or for the years ended December 31, (dollars in thousands, except per share data) 2023 2022 2021 Adjusted non-interest expense: Non-interest expense $ 209,603 $ 184,082 $ 185,455 Less: significant items Impairment charges on assets held for sale and ROU asset 2,395 372 16,430 Merger-related expense 9,222 538 — Adjusted non-interest expense $ 197,986 $ 183,172 $ 169,025 Adjusted non-interest expense excluding amortization of intangible assets: Adjusted non-interest expense $ 197,986 $ 183,172 $ 169,025 Less: Amortization of intangible assets 6,011 6,671 7,073 Adjusted non-interest expense excluding amortization of intangible assets $ 191,975 $ 176,501 $ 161,952 Pre-tax pre-provision net income: Pre-tax income $ 145,680 $ 114,683 $ 124,212 Add: Provision for credit losses 31,653 23,879 973 Pre-tax pre-provision net income $ 177,333 $ 138,562 $ 125,185 Adjusted pre-tax pre-provision net income: Pre-tax pre-provision net income $ 177,333 $ 138,562 $ 125,185 Impairment charges on assets held for sale and ROU asset 2,395 372 16,430 Merger-related expense 9,222 538 — Adjusted pre-tax pre-provision net income $ 188,950 $ 139,472 $ 141,615 Tax equivalent net interest income: Net interest income $ 330,621 $ 265,330 $ 236,387 Add: Tax-equivalent adjustment 903 915 1,039 Net interest income, fully taxable equivalent $ 331,524 $ 266,245 $ 237,426 Total revenues: Net interest income $ 330,621 $ 265,330 $ 236,387 Add: non-interest income 56,315 57,314 74,253 Total revenues $ 386,936 $ 322,644 $ 310,640 Tangible common stockholders' equity: Total stockholders' equity $ 990,151 $ 765,816 $ 836,382 Less: Preferred stock — — 10,438 Less: Goodwill 181,705 148,353 148,353 Less: Core deposit intangibles and other intangibles 21,773 10,534 17,205 Tangible common stockholders' equity $ 786,673 $ 606,929 $ 660,386 Tangible assets: Total assets $ 8,881,967 $ 7,362,941 $ 6,696,172 Less: Goodwill 181,705 148,353 148,353 Less: Core deposit intangibles and other intangibles 21,773 10,534 17,205 Tangible assets $ 8,678,489 $ 7,204,054 $ 6,530,614 Average tangible common stockholders' equity: Average total stockholders' equity $ 863,092 $ 776,225 $ 820,017 Less: Average preferred stock — 2,459 10,438 Less: Average goodwill 164,487 148,353 148,353 Less: Average core deposit intangibles and other intangibles 16,230 13,850 20,689 Average tangible common stockholders' equity $ 682,375 $ 611,563 $ 640,537 Average tangible assets: Average total assets $ 8,048,331 $ 7,018,779 $ 6,642,131 Less: Average goodwill 164,487 148,353 148,353 Less: Average core deposit intangibles and other intangibles 16,230 13,850 20,689 Average tangible assets $ 7,867,614 $ 6,856,576 $ 6,473,089 Tangible net income available to common stockholders: Net income available to common stockholders $ 107,878 $ 87,758 $ 92,002 Add: After-tax intangible asset amortization 4,408 4,890 5,147 Tangible net income available to common stockholders $ 112,286 $ 92,648 $ 97,149 Adjusted Tangible net income available to common stockholders: Tangible net income available to common stockholders $ 112,286 $ 92,648 $ 97,149 Impairment charges on assets held for sale and ROU asset 2,395 372 16,430 Merger-related expense 9,222 538 — Tax benefit on significant items (2,696 ) (118 ) (4,462 ) Adjusted tangible net income available to common stockholders $ 121,207 $ 93,440 $ 109,117 40 Table of Contents As of or for the years ended December 31, (dollars in thousands, except share and per share data) 2023 2022 2021 Pre-tax pre-provision return on average assets: Pre-tax pre-provision net income $ 177,333 $ 138,562 $ 125,185 Total average assets 8,048,331 7,018,779 6,642,131 Pre-tax pre-provision return on average assets 2.20 % 1.97 % 1.88 % Adjusted Pre-tax pre-provision return on average assets: Adjusted pre-tax pre-provision net income $ 188,950 $ 139,472 $ 141,615 Total average assets 8,048,331 7,018,779 6,642,131 Adjusted pre-tax pre-provision return on average assets 2.35 % 1.99 % 2.13 % Net interest margin, fully taxable equivalent: Net interest income, fully taxable equivalent $ 331,524 $ 266,245 $ 237,426 Total average interest-earning assets 7,677,848 6,630,464 6,148,841 Net interest margin, fully taxable equivalent 4.32 % 4.01 % 3.86 % Non-interest income to total revenues: Non-interest income $ 56,315 $ 57,314 $ 74,253 Total revenues 386,936 322,644 310,640 Non-interest income to total revenues 14.55 % 17.76 % 23.90 % Adjusted non-interest expense to average assets: Adjusted non-interest expense $ 197,986 $ 183,172 $ 169,025 Total average assets 8,048,331 7,018,779 6,642,131 Adjusted non-interest expense to average assets 2.46 % 2.61 % 2.54 % Adjusted efficiency ratio: Adjusted non-interest expense excluding amortization of intangible assets $ 191,975 $ 176,501 $ 161,952 Total revenues 386,936 322,644 310,640 Adjusted efficiency ratio 49.61 % 54.70 % 52.14 % Adjusted return on average assets: Adjusted net income $ 116,799 $ 88,746 $ 104,753 Total average assets 8,048,331 7,018,779 6,642,131 Adjusted return on average assets 1.45 % 1.26 % 1.58 % Adjusted return on average stockholders' equity: Adjusted net income $ 116,799 $ 88,746 $ 104,753 Average stockholders' equity 863,092 776,225 820,017 Adjusted return on average stockholders' equity 13.53 % 11.43 % 12.77 % Tangible common equity to tangible assets: Tangible common equity $ 786,673 $ 606,929 $ 660,386 Tangible assets 8,678,489 7,204,054 6,530,614 Tangible common equity to tangible assets 9.06 % 8.42 % 10.11 % Return on average tangible common stockholders' equity: Tangible net income available to common stockholders $ 112,286 $ 92,648 $ 97,149 Average tangible common stockholders' equity 682,375 611,563 640,537 Return on average tangible common stockholders' equity: 16.46 % 15.15 % 15.17 % Adjusted return on average tangible common stockholders' equity: Adjusted tangible net income available to common stockholders $ 121,207 $ 93,440 $ 109,117 Average tangible common stockholders' equity 682,375 611,563 640,537 Adjusted return on average tangible common stockholders' equity 17.76 % 15.28 % 17.04 % Tangible book value per share: Tangible common equity $ 786,673 $ 606,929 $ 660,386 Common shares outstanding 43,764,056 37,492,775 37,713,903 Tangible book value per share $ 17.98 $ 16.19 $ 17.51 41 Table of Contents Results of Operations Net interest income Net interest income, representing interest income less interest expense, is a significant contributor to our revenues and earnings.
The following reconciliation tables provide a more detailed analysis of the non‑GAAP financial measures discussed herein: As of or for the years ended December 31, (dollars in thousands, except per share data) 2024 2023 2022 Net income and earnings per share excluding significant items Reported Net Income $ 120,759 $ 107,878 $ 87,954 Significant items: Impairment charges on assets held for sale and ROU asset 194 2,395 372 Merger-related expense 629 9,222 538 Tax benefit on impairment charges and merger-related expenses (85 ) (2,696 ) (118 ) Adjusted Net Income $ 121,497 $ 116,799 $ 88,746 Reported Diluted Earnings per Share $ 2.75 $ 2.67 $ 2.34 Significant items: Impairment charges on assets held for sale and ROU asset — 0.06 0.01 Merger-related expense 0.01 0.23 0.01 Tax benefit on impairment charges and merger-related expenses — (0.07 ) — Adjusted Diluted Earnings per Share $ 2.76 $ 2.89 $ 2.36 39 Table of Contents As of or for the years ended December 31, (dollars in thousands, except per share data) 2024 2023 2022 Adjusted non-interest expense: Non-interest expense $ 218,777 $ 209,603 $ 184,082 Less: Significant items Impairment charges on assets held for sale and ROU asset 194 2,395 372 Merger-related expense 629 9,222 538 Adjusted non-interest expense $ 217,954 $ 197,986 $ 183,172 Adjusted non-interest expense excluding amortization of intangible assets: Adjusted non-interest expense $ 217,954 $ 197,986 $ 183,172 Less: Amortization of intangible assets 5,380 6,011 6,671 Adjusted non-interest expense excluding amortization of intangible assets $ 212,574 $ 191,975 $ 176,501 Pre-tax pre-provision net income: Pre-tax income $ 161,079 $ 145,680 $ 114,683 Add: Provision for credit losses 27,041 31,653 23,879 Pre-tax pre-provision net income $ 188,120 $ 177,333 $ 138,562 Adjusted pre-tax pre-provision net income: Pre-tax pre-provision net income $ 188,120 $ 177,333 $ 138,562 Impairment charges on assets held for sale and ROU asset 194 2,395 372 Merger-related expense 629 9,222 538 Adjusted pre-tax pre-provision net income $ 188,943 $ 188,950 $ 139,472 Tax equivalent net interest income: Net interest income $ 348,046 $ 330,621 $ 265,330 Add: Tax-equivalent adjustment 921 903 915 Net interest income, fully taxable equivalent $ 348,967 $ 331,524 $ 266,245 Total revenues: Net interest income $ 348,046 $ 330,621 $ 265,330 Add: Non-interest income 58,851 56,315 57,314 Total revenues $ 406,897 $ 386,936 $ 322,644 Tangible common stockholders' equity: Total stockholders' equity $ 1,091,497 $ 990,151 $ 765,816 Less: Goodwill 181,705 181,705 148,353 Less: Core deposit intangibles and other intangibles 16,393 21,773 10,534 Tangible common stockholders' equity $ 893,399 $ 786,673 $ 606,929 Tangible assets: Total assets $ 9,496,529 $ 8,881,967 $ 7,362,941 Less: Goodwill 181,705 181,705 148,353 Less: Core deposit intangibles and other intangibles 16,393 21,773 10,534 Tangible assets $ 9,298,431 $ 8,678,489 $ 7,204,054 Average tangible common stockholders' equity: Average total stockholders' equity $ 1,040,515 $ 863,092 $ 776,225 Less: Average preferred stock — — 2,459 Less: Average goodwill 181,705 164,487 148,353 Less: Average core deposit intangibles and other intangibles 19,035 16,230 13,850 Average tangible common stockholders' equity $ 839,775 $ 682,375 $ 611,563 Average tangible assets: Average total assets $ 9,187,342 $ 8,048,331 $ 7,018,779 Less: Average goodwill 181,705 164,487 148,353 Less: Average core deposit intangibles and other intangibles 19,035 16,230 13,850 Average tangible assets $ 8,986,602 $ 7,867,614 $ 6,856,576 Tangible net income available to common stockholders: Net income available to common stockholders $ 120,759 $ 107,878 $ 87,758 Add: After-tax intangible asset amortization 3,974 4,408 4,890 Tangible net income available to common stockholders $ 124,733 $ 112,286 $ 92,648 Adjusted Tangible net income available to common stockholders: Tangible net income available to common stockholders $ 124,733 $ 112,286 $ 92,648 Impairment charges on assets held for sale and ROU asset 194 2,395 372 Merger-related expense 629 9,222 538 Tax benefit on significant items (85 ) (2,696 ) (118 ) Adjusted tangible net income available to common stockholders $ 125,471 $ 121,207 $ 93,440 40 Table of Contents As of or for the years ended December 31, (dollars in thousands, except share and per share data) 2024 2023 2022 Pre-tax pre-provision return on average assets: Pre-tax pre-provision net income $ 188,120 $ 177,333 $ 138,562 Total average assets 9,187,342 8,048,331 7,018,779 Pre-tax pre-provision return on average assets 2.05 % 2.20 % 1.97 % Adjusted Pre-tax pre-provision return on average assets: Adjusted pre-tax pre-provision net income $ 188,943 $ 188,950 $ 139,472 Total average assets 9,187,342 8,048,331 7,018,779 Adjusted pre-tax pre-provision return on average assets 2.06 % 2.35 % 1.99 % Net interest margin, fully taxable equivalent: Net interest income, fully taxable equivalent $ 348,967 $ 331,524 $ 266,245 Total average interest-earning assets 8,774,014 7,677,848 6,630,464 Net interest margin, fully taxable equivalent 3.98 % 4.32 % 4.01 % Non-interest income to total revenues: Non-interest income $ 58,851 $ 56,315 $ 57,314 Total revenues 406,897 386,936 322,644 Non-interest income to total revenues 14.46 % 14.55 % 17.76 % Adjusted non-interest expense to average assets: Adjusted non-interest expense $ 217,954 $ 197,986 $ 183,172 Total average assets 9,187,342 8,048,331 7,018,779 Adjusted non-interest expense to average assets 2.37 % 2.46 % 2.61 % Adjusted efficiency ratio: Adjusted non-interest expense excluding amortization of intangible assets $ 212,574 $ 191,975 $ 176,501 Total revenues 406,897 386,936 322,644 Adjusted efficiency ratio 52.24 % 49.61 % 54.70 % Adjusted return on average assets: Adjusted net income $ 121,497 $ 116,799 $ 88,746 Total average assets 9,187,342 8,048,331 7,018,779 Adjusted return on average assets 1.32 % 1.45 % 1.26 % Adjusted return on average stockholders' equity: Adjusted net income $ 121,497 $ 116,799 $ 88,746 Average stockholders' equity 1,040,515 863,092 776,225 Adjusted return on average stockholders' equity 11.68 % 13.53 % 11.43 % Tangible common equity to tangible assets: Tangible common equity $ 893,399 $ 786,673 $ 606,929 Tangible assets 9,298,431 8,678,489 7,204,054 Tangible common equity to tangible assets 9.61 % 9.06 % 8.42 % Return on average tangible common stockholders' equity: Tangible net income available to common stockholders $ 124,733 $ 112,286 $ 92,648 Average tangible common stockholders' equity 839,775 682,375 611,563 Return on average tangible common stockholders' equity: 14.85 % 16.46 % 15.15 % Adjusted return on average tangible common stockholders' equity: Adjusted tangible net income available to common stockholders $ 125,471 $ 121,207 $ 93,440 Average tangible common stockholders' equity 839,775 682,375 611,563 Adjusted return on average tangible common stockholders' equity 14.94 % 17.76 % 15.28 % Tangible book value per common share: Tangible common equity $ 893,399 $ 786,673 $ 606,929 Common shares outstanding 44,459,584 43,764,056 37,492,775 Tangible book value per common share $ 20.09 $ 17.98 $ 16.19 41 Table of Contents Results of Operations Net interest income Net interest income, representing interest income less interest expense, is a significant contributor to our revenues and earnings.
Total net loan accretion on acquired loans contributed 22 basis points to the net interest margin for the year ended December 31, 2023 compared to seven basis points for the year ended December 31, 2022. We expected loan accretion income to decline as acquired loans mature.
Total net loan accretion on acquired loans contributed 15 basis points to the net interest margin for the year ended December 31, 2024 compared to 22 basis points for the year ended December 31, 2023. Assuming no additional acquisitions, we expect loan accretion income to decline as acquired loans mature.
For the year ended December 31, 2023, the provision for credit losses is comprised of a provision for loan and lease losses of $32.2 million and a recapture for unfunded commitments of $567,000.
For the year ended December 31, 2024, the provision for credit losses is comprised of a provision for loan and lease losses of $28.3 million and a recapture of provision for unfunded commitments of $1.2 million.
There have been no conditions or events since December 31, 2023 that management believes have changed Byline Bank’s classifications. Off-balance sheet items and other financing arrangements We are a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of our customers.
As of December 31, 2024, Byline Bank exceeded all applicable regulatory capital requirements and was considered "well-capitalized." There have been no conditions or events since December 31, 2024 that management believes have changed Byline Bank’s classifications. 60 Table of Contents Off-balance sheet items and other financing arrangements We are a party to financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of our customers.
As of December 31, 2023, the loan portfolio included $422.8 million of unguaranteed SBA 7(a) and USDA loans with exposure to the following top three industries: 16.8% retail trade, 14.0% accommodation and food services and 11.6% manufacturing.
As of December 31, 2024, the loan portfolio included $421.5 million of unguaranteed SBA 7(a) and USDA loans with exposure to the following top three industries: 19.0% retail trade, 13.8% accommodation and food services and 10.0% manufacturing.
The following table sets forth the amounts of non-performing loans and leases, non-performing assets, and OREO at the dates indicated (dollars in thousands): December 31, 2023 December 31, 2022 Non-performing assets: Non-accrual loans and leases (1)(2) $ 64,107 $ 36,027 Past due loans and leases 90 days or more and still accruing interest — — Total non-performing loans and leases 64,107 36,027 Other real estate owned 1,200 4,717 Total non-performing assets $ 65,307 $ 40,744 Total non-performing loans and leases as a percentage of total loans and leases 0.96 % 0.66 % Total non-accrual loans and leases as a percentage of total loans and leases 0.96 % 0.66 % Total non-performing assets as a percentage of total assets 0.74 % 0.55 % Allowance for credit losses - loans and leases, as a percentage of non-performing loans and leases 158.62 % 227.40 % Allowance for credit losses - loans and leases, as a percentage of non-accrual loans and leases 158.62 % 227.40 % Non-performing loans guaranteed by U.S. government: Non-accrual loans guaranteed $ 4,154 $ 2,225 Past due loans 90 days or more and still accruing interest guaranteed — — Total non-performing loans guaranteed $ 4,154 $ 2,225 Total non-performing loans and leases not guaranteed as a percentage of total loans and leases 0.90 % 0.62 % Total non-accrual loans and leases not guaranteed as a percentage of total loans and leases 0.62 % 0.62 % Total non-performing assets not guaranteed as a percentage of total assets 0.69 % 0.52 % (1) Includes $406,000 of non-accrual loan modifications as of December 31, 2023 and $1.6 million of non-accrual restructured loans at December 31, 2022.
The following table sets forth the amounts of non-performing loans and leases, non-performing assets, and OREO at the dates indicated (dollars in thousands): December 31, 2024 December 31, 2023 Non-performing assets: Non-accrual loans and leases (1)(2) $ 62,076 $ 64,107 Past due loans and leases 90 days or more and still accruing interest — — Total non-performing loans and leases 62,076 64,107 Other real estate owned 5,170 1,200 Total non-performing assets $ 67,246 $ 65,307 Total non-performing loans and leases as a percentage of total loans and leases 0.90 % 0.96 % Total non-accrual loans and leases as a percentage of total loans and leases 0.90 % 0.96 % Total non-performing assets as a percentage of total assets 0.71 % 0.74 % Allowance for credit losses - loans and leases, as a percentage of non-performing loans and leases 157.85 % 158.62 % Allowance for credit losses - loans and leases, as a percentage of non-accrual loans and leases 157.85 % 158.62 % Non-performing loans guaranteed by U.S. government: Non-accrual loans guaranteed $ 9,862 $ 4,154 Past due loans 90 days or more and still accruing interest guaranteed — — Total non-performing loans guaranteed $ 9,862 $ 4,154 Total non-performing loans and leases not guaranteed as a percentage of total loans and leases 0.76 % 0.90 % Total non-accrual loans and leases not guaranteed as a percentage of total loans and leases 0.76 % 0.90 % Total non-performing assets not guaranteed as a percentage of total assets 0.60 % 0.69 % (1) Includes $2.8 million and $406,000 of non-accrual loan modifications as of December 31, 2024 and 2023, respectively.
In addition, Byline Bank had an uncommitted federal funds line available of $135.0 million at December 31, 2023. As of December 31, 2022, Byline Bank had maximum borrowing capacity from the FHLB of $2.5 billion and $804.6 million from the FRB.
In addition, Byline Bank had an uncommitted federal funds line available of $127.5 million at December 31, 2024. As of December 31, 2023, Byline Bank had maximum borrowing capacity from the FHLB of $3.1 billion and $866.5 million from the FRB.
The construction, land development and other land loan portfolio was 48.3% and 51.2% of total capital, at December 31, 2023 and December 31, 2022, respectively. Commercial and industrial loans totaled $2.4 billion and $2.1 billion at December 31, 2023 and 2022, respectively, an increase of $391.7 million, or 19.1%, primarily due to the acquisition and organic growth.
The construction, land development and other land loan portfolio was 41.3% and 48.4% of Byline Bank total capital, at December 31, 2024 and December 31, 2023, respectively. Commercial and industrial loans. Commercial and industrial loans totaled $2.6 billion and $2.4 billion at December 31, 2024 and 2023, respectively, an increase of $168.6 million, or 6.9%, primarily due to organic growth.
In particular, management has identified several accounting policies that, due to the estimates, assumptions and judgments inherent in those policies, are critical in understanding our financial statements.
As this information changes, actual results could differ from the estimates, assumptions and judgments reflected in the financial statements. In particular, management has identified several accounting policies that, due to the estimates, assumptions and judgments inherent in those policies, are critical in understanding our financial statements.
For the year ended December 31, 2022, the provision for credit losses is comprised of a provision for loan and lease losses of $22.7 million and a provision for unfunded commitments of $1.2 million. The ACL as a percentage of loans and leases increased slightly from 1.51% at December 31, 2022 to 1.52% at December 31, 2023.
For the year ended December 31, 2023, the provision for credit losses is comprised of a provision for loan and lease losses of $32.2 million and a recapture of provision for unfunded commitments of $567,000. The ACL as a percentage of loans and leases decreased from 1.52% at December 31, 2023 to 1.42% at December 31, 2024.
The following table presents the major components of our non-interest income for the periods indicated (dollars in thousands): Year ended December 31, 2023 compared to 2022 2022 compared to 2021 2023 2022 2021 $ Change % Change $ Change % Change Fees and service charges on deposits $ 9,211 $ 8,152 $ 7,254 $ 1,059 13.0 % $ 898 12.4 % Loan servicing revenue 13,503 13,479 12,693 24 0.2 % 786 6.2 % Loan servicing asset revaluation (5,089 ) (11,743 ) (6,658 ) 6,654 (56.7 )% (5,085 ) 76.4 % ATM and interchange fees 4,462 4,437 4,476 25 0.6 % (39 ) (0.9 )% Net gains on sales of securities available-for-sale — 50 1,435 (50 ) (100.0 )% (1,385 ) (96.5 )% Change in fair value of equity securities, net 1,071 (603 ) (62 ) 1,674 NM (541 ) NM Net gains on sales of loans 22,805 31,899 46,274 (9,094 ) (28.5 )% (14,375 ) (31.1 )% Wealth management and trust income 4,158 3,807 3,069 351 9.2 % 738 24.0 % Other non-interest income 6,194 7,836 5,772 (1,642 ) (21.0 )% 2,064 35.8 % Total non-interest income $ 56,315 $ 57,314 $ 74,253 $ (999 ) (1.7 )% $ (16,939 ) (22.8 )% NM - Not meaningful Fees and service charge on deposits represent amounts charged to customers for banking services, such as fees on deposit accounts, and include, but not limited to, maintenance fees, insufficient fund fees, overdraft protection fees, wire transfer fees, and other charges.
The following table presents the major components of our non-interest income for the periods indicated (dollars in thousands): Year ended December 31, 2024 compared to 2023 2023 compared to 2022 2024 2023 2022 $ Change % Change $ Change % Change Fees and service charges on deposits $ 10,214 $ 9,211 $ 8,152 $ 1,003 10.9 % $ 1,059 13.0 % Loan servicing revenue 12,905 13,503 13,479 (598 ) (4.4 )% 24 0.2 % Loan servicing asset revaluation (6,704 ) (5,089 ) (11,743 ) (1,615 ) 31.7 % 6,654 (56.7 )% ATM and interchange fees 4,464 4,462 4,437 2 0.1 % 25 0.6 % Net gains (losses) on sales of securities available-for-sale (699 ) — 50 (699 ) 100.0 % (50 ) (100.0 )% Change in fair value of equity securities, net 1,122 1,071 (603 ) 51 4.8 % 1,674 NM Net gains on sales of loans 24,540 22,805 31,899 1,735 7.6 % (9,094 ) (28.5 )% Wealth management and trust income 4,310 4,158 3,807 152 3.7 % 351 9.2 % Other non-interest income 8,699 6,194 7,836 2,505 40.5 % (1,642 ) (21.0 )% Total non-interest income $ 58,851 $ 56,315 $ 57,314 $ 2,536 4.5 % $ (999 ) (1.7 )% NM - Not meaningful Fees and service charges on deposits represent amounts charged to customers for banking services, such as fees on deposit accounts, and include, but are not limited to, maintenance fees, insufficient fund fees, overdraft protection fees, wire transfer fees, treasury management fees, and other charges.
"Business—Supervision and Regulation—Regulatory Capital Requirements", "Business—Supervision and Regulation—Prompt Corrective Action Framework" and Note 20 of the notes to our audited consolidated financial statements contained in Item 8 of this report for additional information. As of December 31, 2023, Byline Bank exceeded all applicable regulatory capital requirements and was considered "well-capitalized".
"Business—Supervision and Regulation—Regulatory Capital Requirements", "Business—Supervision and Regulation—Prompt Corrective Action Framework" and Note 20 of the notes to our audited consolidated financial statements contained in Item 8 of this report for additional information.
The average yield on interest-earning assets increased 170 basis points to 6.26% for the year ended December 31, 2023 compared to 4.56% for the year ended December 31, 2022, while the average rate paid on interest-bearing liabilities increased by 202 basis points to 2.95%, resulting in a decrease in the interest rate spread of 32 basis points. 44 Table of Contents Net loan accretion income was $16.7 million for the year ended December 31, 2023 compared to $4.6 million for the year ended December 31, 2022, an increase of $12.2 million.
The average yield on interest-earning assets increased 20 basis points to 6.46% for the year ended December 31, 2024 compared to 6.26% for the year ended December 31, 2023, while the average rate paid on interest-bearing liabilities increased by 59 basis points to 3.54% from 2.95%, resulting in a decrease in the interest rate spread of 39 basis points. 44 Table of Contents Net loan accretion income was $13.5 million for the year ended December 31, 2024 compared to $16.7 million for the year ended December 31, 2023, a decrease of $3.2 million.
Core deposits were 87.0% and 92.7% of total deposits at December 31, 2023 and 2022, respectively.
Core deposits were 85.9% and 87.0% of total deposits at December 31, 2024 and 2023, respectively.
The increase was due to increases in expenses related to government guaranteed loans. Legal, audit and other professional fees for the year ended December 31, 2023 were $12.9 million compared to $10.4 million for the year ended December 31, 2022, an increase of $2.6 million or 25.0%.
The decrease was due to decreases in expenses related to government guaranteed loans. Legal, audit and other professional fees for the year ended December 31, 2024 were $13.4 million compared to $12.9 million for the year ended December 31, 2023, an increase of $482,000 or 3.7%.
If the Company fails to provide timely notification, the interest rate will be Prime Rate minus 75 basis points. At December 31, 2023, the outstanding balance was $11.3 million. At December 31, 2022 the line of credit had no outstanding balance. There are regulatory limitations that affect the ability of Byline Bank to pay dividends to the Company.
If the Company fails to provide timely notification, the interest rate will be Prime Rate minus 75 basis points. At December 31, 2023, the outstanding balance on the revolving line of credit was $11.3 million. At December 31, 2024 the line of credit had no outstanding balance.
Yields have been calculated on a pre-tax basis (dollars in thousands): Year Ended December 31, 2023 2022 2021 Average Balance (5) Interest Inc / Exp Avg Yield / Rate Average Balance (5) Interest Inc / Exp Avg Yield / Rate Average Balance (5) Interest Inc / Exp Avg Yield / Rate ASSETS Cash and cash equivalents $ 157,754 $ 5,029 3.19 % $ 76,978 $ 547 0.71 % $ 69,338 $ 117 0.17 % Loans and leases (1) 6,038,797 440,984 7.30 % 5,073,288 273,412 5.39 % 4,518,836 222,993 4.93 % Taxable securities 1,322,379 30,068 2.27 % 1,316,147 24,156 1.84 % 1,376,045 21,909 1.59 % Tax-exempt securities (2) 158,918 4,300 2.71 % 164,051 4,359 2.66 % 184,622 4,946 2.68 % Total interest-earning assets $ 7,677,848 $ 480,381 6.26 % $ 6,630,464 $ 302,474 4.56 % $ 6,148,841 $ 249,965 4.07 % Allowance for credit losses - loans and leases (98,067 ) (74,233 ) (63,351 ) All other assets 468,550 462,548 556,641 TOTAL ASSETS $ 8,048,331 $ 7,018,779 $ 6,642,131 LIABILITIES AND STOCKHOLDERS’ EQUITY Deposits Interest checking $ 574,335 $ 9,212 1.60 % $ 593,903 $ 3,572 0.60 % $ 622,147 $ 883 0.14 % Money market accounts 1,802,675 53,933 2.99 % 1,357,371 10,484 0.77 % 1,073,970 1,285 0.12 % Savings 585,820 883 0.15 % 658,968 649 0.10 % 610,953 289 0.05 % Time deposits 1,468,836 57,408 3.91 % 691,650 5,091 0.74 % 722,974 2,045 0.28 % Total interest-bearing deposits 4,431,666 121,436 2.74 % 3,301,892 19,796 0.60 % 3,030,044 4,502 0.15 % Other borrowings 484,984 17,125 3.53 % 478,374 9,308 1.95 % 525,078 1,663 0.32 % Federal funds purchased 685 36 5.30 % 630 14 2.32 % — — 0.00 % Subordinated notes and debentures 127,825 10,260 8.03 % 110,723 7,111 6.42 % 110,108 6,374 5.79 % Total borrowings 613,494 27,421 4.47 % 589,727 16,433 2.79 % 635,186 8,037 1.27 % Total interest-bearing liabilities $ 5,045,160 $ 148,857 2.95 % $ 3,891,619 $ 36,229 0.93 % $ 3,665,230 $ 12,539 0.34 % Non-interest bearing demand deposits 1,965,663 2,236,615 2,085,454 Other liabilities 174,416 114,320 71,430 Total stockholders’ equity 863,092 776,225 820,017 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 8,048,331 $ 7,018,779 $ 6,642,131 Net interest spread (3) 3.31 % 3.63 % 3.73 % Net interest income, fully taxable equivalent $ 331,524 $ 266,245 $ 237,426 Net interest margin, fully taxable equivalent (2)(4) 4.32 % 4.01 % 3.86 % Tax-equivalent adjustment 903 0.01 % 915 0.01 % 1,039 0.02 % Net interest income $ 330,621 $ 265,330 $ 236,387 Net interest margin (4) 4.31 % 4.00 % 3.84 % Net loan accretion impact on margin $ 16,726 0.22 % $ 4,555 0.07 % $ 6,451 0.10 % (1) Loan and lease balances are net of deferred origination fees and costs and initial direct costs.
Yields have been calculated on a pre-tax basis (dollars in thousands): Year Ended December 31, 2024 2023 2022 Average Balance (5) Interest Inc / Exp Avg Yield / Rate Average Balance (5) Interest Inc / Exp Avg Yield / Rate Average Balance (5) Interest Inc / Exp Avg Yield / Rate ASSETS Cash and cash equivalents $ 346,777 $ 15,635 4.51 % $ 157,754 $ 5,029 3.19 % $ 76,978 $ 547 0.71 % Loans and leases (1) 6,786,547 502,353 7.40 % 6,038,797 440,984 7.30 % 5,073,288 273,412 5.39 % Taxable securities 1,483,640 44,476 3.00 % 1,322,379 30,068 2.27 % 1,316,147 24,156 1.84 % Tax-exempt securities (2) 157,050 4,386 2.79 % 158,918 4,300 2.71 % 164,051 4,359 2.66 % Total interest-earning assets $ 8,774,014 $ 566,850 6.46 % $ 7,677,848 $ 480,381 6.26 % $ 6,630,464 $ 302,474 4.56 % Allowance for credit losses - loans and leases (101,695 ) (98,067 ) (74,233 ) All other assets 515,023 468,550 462,548 TOTAL ASSETS $ 9,187,342 $ 8,048,331 $ 7,018,779 LIABILITIES AND STOCKHOLDERS’ EQUITY Deposits Interest checking $ 695,156 $ 14,442 2.08 % $ 574,335 $ 9,212 1.60 % $ 593,903 $ 3,572 0.60 % Money market accounts 2,344,309 80,960 3.45 % 1,802,675 53,933 2.99 % 1,357,371 10,484 0.77 % Savings 506,889 711 0.14 % 585,820 883 0.15 % 658,968 649 0.10 % Time deposits 2,024,942 96,253 4.75 % 1,468,836 57,408 3.91 % 691,650 5,091 0.74 % Total interest-bearing deposits 5,571,296 192,366 3.45 % 4,431,666 121,436 2.74 % 3,301,892 19,796 0.60 % Other borrowings 442,364 13,648 3.09 % 484,984 17,125 3.53 % 478,374 9,308 1.95 % Federal funds purchased 348 21 6.05 % 685 36 5.30 % 630 14 2.32 % Subordinated notes and debentures 144,624 11,848 8.19 % 127,825 10,260 8.03 % 110,723 7,111 6.42 % Total borrowings 587,336 25,517 4.34 % 613,494 27,421 4.47 % 589,727 16,433 2.79 % Total interest-bearing liabilities $ 6,158,632 $ 217,883 3.54 % $ 5,045,160 $ 148,857 2.95 % $ 3,891,619 $ 36,229 0.93 % Non-interest bearing demand deposits 1,802,258 1,965,663 2,236,615 Other liabilities 185,937 174,416 114,320 Total stockholders’ equity 1,040,515 863,092 776,225 TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 9,187,342 $ 8,048,331 $ 7,018,779 Net interest spread (3) 2.92 % 3.31 % 3.63 % Net interest income, fully taxable equivalent $ 348,967 $ 331,524 $ 266,245 Net interest margin, fully taxable equivalent (2)(4) 3.98 % 4.32 % 4.01 % Tax-equivalent adjustment 921 0.01 % 903 0.01 % 915 0.01 % Net interest income $ 348,046 $ 330,621 $ 265,330 Net interest margin (4) 3.97 % 4.31 % 4.00 % Net loan accretion impact on margin $ 13,511 0.15 % $ 16,726 0.22 % $ 4,555 0.07 % (1) Loan and lease balances are net of deferred origination fees and costs and initial direct costs.
We reported consolidated net income of $107.9 million for the year ended December 31, 2023, compared to net income of $88.0 million for the year ended December 31, 2022, an increase of $19.9 million.
We reported consolidated net income of $120.8 million for the year ended December 31, 2024, compared to net income of $107.9 million for the year ended December 31, 2023, an increase of $12.9 million, or 11.9%.
For the years ended December 31, 2023 and 2022, our efficiency ratio was 52.62% and 54.99%, respectively. The improvement in our efficiency ratio was primarily attributable to increased net interest income. For the years ended December 31, 2023 and 2022, our adjusted efficiency ratio was 49.61% and 54.70%, respectively.
The improvement in our efficiency ratio was primarily attributable to increased net interest income and non-interest income, offset by an increase in non-interest expense. For the years ended December 31, 2024 and 2023, our adjusted efficiency ratio was 52.24% and 49.61%, respectively.
At December 31, 2023, we evaluated the securities in an unrealized loss position for credit losses and determined there were none. There were 285 investment securities with unrealized losses at December 31, 2023. We anticipate full recovery of amortized cost with respect to these securities by maturity, or sooner in the event of a more favorable market interest rate environment.
There were 335 investment securities with unrealized losses at December 31, 2024 totaling $181.7 million. We anticipate full recovery of amortized cost with respect to these securities by maturity, or sooner in the event of a more favorable market interest rate environment.
The following tables show the average balance amounts and the average contractual rates paid on our deposits for the periods indicated (dollars in thousands): For the Year Ended December 31, 2023 For the Year Ended December 31, 2022 Average Balance Average Rate Average Balance Average Rate Non-interest-bearing demand deposits $ 1,965,663 0.00 % $ 2,236,615 0.00 % Interest checking 574,335 1.60 % 593,903 0.60 % Money market accounts 1,802,675 2.99 % 1,357,371 0.77 % Savings 585,820 0.15 % 658,968 0.10 % Time deposits (below $100,000) 808,882 4.09 % 315,172 0.85 % Time deposits ($100,000 and above) 659,954 3.69 % 376,478 0.64 % Total $ 6,397,329 1.90 % $ 5,538,506 0.36 % Our average cost of deposits was 190 basis points during the year ended December 31, 2023 compared to 36 basis points during the year ended December 31, 2022.
The following tables show the average balance amounts and the average contractual rates paid on our deposits for the periods indicated (dollars in thousands): For the Year Ended December 31, 2024 For the Year Ended December 31, 2023 Average Balance Average Rate Average Balance Average Rate Non-interest-bearing demand deposits $ 1,802,258 0.00 % $ 1,965,663 0.00 % Interest checking 695,156 2.08 % 574,335 1.60 % Money market accounts 2,344,309 3.45 % 1,802,675 2.99 % Savings 506,889 0.14 % 585,820 0.15 % Time deposits (below $100,000) 954,565 4.70 % 808,882 4.09 % Time deposits ($100,000 and above) 1,070,377 4.80 % 659,954 3.69 % Total $ 7,373,554 2.61 % $ 6,397,329 1.90 % Our average cost of deposits was 261 basis points during the year ended December 31, 2024 compared to 190 basis points during the year ended December 31, 2023.
The increase in income tax expense was primarily due to increased income before provision for income taxes during 2023. Our effective tax rate was 25.9% for the year ended December 31, 2023 and 23.3% for the year ended December 31, 2022.
The increase in income tax expense was primarily due to increased income before provision for income taxes during 2024. Our effective tax rate was 25.0% for the year ended December 31, 2024 and 25.9% for the year ended December 31, 2023. The decrease in our effective tax rate was primarily driven by an increase in tax benefit from share-based compensation.
Other non-interest income was $6.2 million for the year ended December 31, 2023 compared to $7.8 million for the year ended December 31, 2022, a decrease of $1.6 million or 21.0%.
Other non-interest income was $8.7 million for the year ended December 31, 2024 compared to $6.2 million for the year ended December 31, 2023, an increase of $2.5 million or 40.5%.
Projected accretion income as of December 31, 2023 is summarized as follows: Estimated Projected Accretion (1)(2) 2024 $ 10,111 2025 6,154 2026 4,489 2027 2,829 2028 1,619 Thereafter 14,301 Total $ 39,503 (1) Estimated projected accretion excludes contractual interest income on acquired loans and leases. (2) Projections are updated quarterly, assume no prepayments, and are subject to change.
Projected accretion income as of December 31, 2024 is summarized as follows: Estimated Projected Accretion (1)(2) 2025 $ 5,896 2026 4,378 2027 2,719 2028 1,546 2029 1,082 Thereafter 10,084 Total $ 25,705 (1) Estimated projected accretion excludes contractual interest income on acquired loans and leases. (2) Projections are updated quarterly, assume no prepayments, and are subject to change.
Total lease financing receivables were $665.9 million and $524.0 million at December 31, 2023 and 2022, respectively, an increase of $141.9 million, or 27.1%.
Total lease financing receivables were $715.9 million and $665.9 million at December 31, 2024 and 2023, respectively, an increase of $50.1 million, or 7.5%.
The following table presents the major components of our non-interest expense for the periods indicated (dollars in thousands): Year ended December 31, 2023 compared to 2022 2022 compared to 2021 2023 2022 2021 $ Change % Change $ Change % Change Salaries and employee benefits $ 126,979 $ 118,051 $ 101,222 $ 8,928 7.6 % $ 16,829 16.6 % Occupancy expense, net 14,030 13,197 16,553 833 6.3 % (3,356 ) (20.3 )% Equipment expense 4,478 3,791 4,059 687 18.1 % (268 ) (6.6 )% Impairment charge on assets held for sale 2,000 372 12,332 1,628 NM (11,960 ) (97.0 )% Loan and lease related expenses 2,936 1,707 5,957 1,229 72.0 % (4,250 ) (71.3 )% Legal, audit and other professional fees 12,946 10,357 10,198 2,589 25.0 % 159 1.6 % Data processing 19,509 13,358 11,780 6,151 46.1 % 1,578 13.4 % Net loss recognized on other real estate owned and other related expenses 385 708 1,078 (323 ) (45.6 )% (370 ) (34.3 )% Regulatory assessments 4,143 2,953 1,717 1,190 40.3 % 1,236 72.0 % Other intangible assets amortization expense 6,011 6,671 7,073 (660 ) (9.9 )% (402 ) (5.7 )% Advertising and promotions 3,796 2,825 1,800 971 34.4 % 1,025 56.9 % Telecommunications 1,447 918 1,155 529 57.6 % (237 ) (20.5 )% Other non-interest expense 10,943 9,174 10,531 1,769 19.3 % (1,357 ) (12.9 )% Total non-interest expense $ 209,603 $ 184,082 $ 185,455 $ 25,521 13.9 % $ (1,373 ) (0.7 )% Salaries and employee benefits expense for the year ended December 31, 2023 was $127.0 million compared to $118.1 million for the year ended December 31, 2022, an increase of $8.9 million or 7.6%, primarily a result of a higher headcount, merit increases, and increased compensation associated with the Inland acquisition. 46 Table of Contents Occupancy expense for the year ended December 31, 2023 was $14.0 million compared to $13.2 million for the year ended December 31, 2022, an increase of $833,000, or 6.3%.
The following table presents the major components of our non-interest expense for the periods indicated (dollars in thousands): Year ended December 31, 2024 compared to 2023 2023 compared to 2022 2024 2023 2022 $ Change % Change $ Change % Change Salaries and employee benefits $ 140,119 $ 126,979 $ 118,051 $ 13,140 10.3 % $ 8,928 7.6 % Occupancy expense, net 14,686 14,030 13,197 656 4.7 % 833 6.3 % Equipment expense 4,017 4,478 3,791 (461 ) (10.3 )% 687 18.1 % Impairment charge on assets held for sale — 2,000 372 (2,000 ) (100.0 )% 1,628 NM Loan and lease related expenses 2,789 2,936 1,707 (147 ) (5.0 )% 1,229 72.0 % Legal, audit and other professional fees 13,428 12,946 10,357 482 3.7 % 2,589 25.0 % Data processing 16,869 19,509 13,358 (2,640 ) (13.5 )% 6,151 46.1 % Net loss recognized on other real estate owned and other related expenses 568 385 708 183 47.4 % (323 ) (45.6 )% Regulatory assessments 4,179 4,143 2,953 36 0.9 % 1,190 40.3 % Other intangible assets amortization expense 5,380 6,011 6,671 (631 ) (10.5 )% (660 ) (9.9 )% Advertising and promotions 4,978 3,796 2,825 1,182 31.1 % 971 34.4 % Telecommunications 870 1,447 918 (577 ) (39.9 )% 529 57.6 % Other non-interest expense 10,894 10,943 9,174 (49 ) (0.5 )% 1,769 19.3 % Total non-interest expense $ 218,777 $ 209,603 $ 184,082 $ 9,174 4.4 % $ 25,521 13.9 % NM - Not meaningful Salaries and employee benefits expense for the year ended December 31, 2024 was $140.1 million compared to $127.0 million for the year ended December 31, 2023, an increase of $13.1 million or 10.3%, primarily a result of a higher salaries mainly due merit increases, higher incentive compensation, and higher equity-based compensation. 46 Table of Contents Occupancy expense for the year ended December 31, 2024 was $14.7 million compared to $14.0 million for the year ended December 31, 2023, an increase of $656,000, or 4.7%.
Loan servicing asset revaluation had a downward adjustment of $5.1 million for the year ended December 31, 2023, compared to a downward adjustment of $11.7 million for the year ended December 31, 2022.
Loan servicing asset revaluation represents net changes in the fair value of our servicing assets. Loan servicing asset revaluation had a downward adjustment of $6.7 million for the year ended December 31, 2024, compared to a downward adjustment of $5.1 million for the year ended December 31, 2023.
Purchased credit deteriorated residential real estate loans increased from $32.2 million as of December 31, 2022 to $42.5 million as of December 31, 2023, or 31.9%. Multifamily real estate loans were $399.3 million and $303.0 million, or 36.8% and 35.7% of total capital, at December 31, 2023 and December 31, 2022, respectively.
Purchased credit deteriorated residential real estate loans decreased from $42.5 million as of December 31, 2023 to $30.5 million as of December 31, 2024, or 28.2%. Multifamily real estate loans, included in residential real estate loans, were $429.9 million and $399.3 million, or 36.4% and 36.8% of Byline Bank total capital, at December 31, 2024 and December 31, 2023, respectively.
Because the derivative assets and liabilities recorded on the balance sheet at December 31, 2023 do not represent the amounts that may ultimately be paid under these contracts, these assets and liabilities are listed in the table below (dollars in thousands): December 31, 2023 Fair Value Notional Asset Liability Interest rate swaps designated as cash flow hedges $ 650,000 $ 37,475 $ — Other interest rate derivatives—pay fixed, receive floating 706,126 19,447 (19,345 ) Other credit derivatives 3,602 1 — 60 Table of Contents
Because the derivative assets and liabilities recorded on the balance sheet at December 31, 2024 do not represent the amounts that may ultimately be paid under these contracts, these assets and liabilities are listed in the table below (dollars in thousands): December 31, 2024 Fair Value Notional Asset Liability Interest rate swaps designated as cash flow hedges $ 650,000 $ 26,529 $ (52 ) Other interest rate derivatives 851,742 17,865 (17,721 ) Other credit derivatives 17,146 7 (12 ) 61 Table of Contents
Net gains on sales of loans were $22.8 million for the year ended December 31, 2023 compared to $31.9 million for the year ended December 31, 2022, a decrease of $9.1 million, or 28.5%. The decrease in net gains on sales was primarily driven by lower volume of government guaranteed loans sold and lower market premiums for government guaranteed loans.
Net gains on sales of loans were $24.5 million for the year ended December 31, 2024 compared to $22.8 million for the year ended December 31, 2023, an increase of $1.7 million, or 7.6%. The increase in net gains on sales was primarily driven by higher market premiums for U.S. government guaranteed loans.
The average balance of interest-earning assets was $7.7 billion for the year ended December 31, 2023, an increase of $1.0 billion, or 15.8%, compared to 2022, primarily due to growth in our loan and lease portfolios.
The increase in interest income of $86.5 million was principally a result of increased average balances due to portfolio growth and higher yields. The average balance of interest-earning assets was $8.8 billion for the year ended December 31, 2024, an increase of $1.1 billion, or 14.3%, compared to 2023, primarily due to growth in our loan and lease portfolios.
The increase is a result of an increase in total deposits of $1.5 billion, or 26.0%, primarily attributed to our acquisition and organic deposit growth, offset by lower FHLB advances. 47 Table of Contents Investment portfolio Our investment securities portfolio consists of securities classified as equity and other securities, at fair value, available-for-sale, and held-to-maturity.
The increase is primarily attributed to an increase in total deposits of $281.6 million, or 3.9%, driven by organic growth, as well as a $250.0 million increase in FHLB advances at December 31, 2024. Investment portfolio Our investment securities portfolio consists of securities classified as equity and other securities, at fair value, available-for-sale, and held-to-maturity.
The increase in net income was attributable to a $65.3 million increase in net interest income, offset by a $25.5 million increase in non-interest expense, an $11.1 million increase in provision for income taxes, and a $7.8 million increase in provision for credit losses.
The increase in net income was attributable to a $17.4 million increase in net interest income, a $4.6 million decrease in provision for credit losses, and a $2.5 million increase in non-interest income, offset by a $9.2 million increase in non-interest expense, and a $2.5 million increase in provision for income taxes.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeRefer to Note 1—Business and Summary of Significant Accounting Policies, for more detail on the Company’s policy on allowance for credit losses. 2023 Commercial Real Estate Residential Real Estate Construction, Land Development, and Other Land Commercial and Industrial Installment and Other Lease Financing Receivables Total Allowance for credit losses - loans and leases Beginning balance $ 26,061 $ 3,140 $ 3,134 $ 41,889 $ 24 $ 7,676 $ 81,924 Adjustment for acquired PCD loans 8,230 660 97 1,609 — — 10,596 Provision/(recapture) 7,237 ( 402 ) ( 325 ) 23,402 11 2,297 32,220 Charge-offs ( 9,729 ) ( 21 ) — ( 15,411 ) ( 3 ) ( 2,437 ) ( 27,601 ) Recoveries 1,438 118 — 2,293 4 694 4,547 Ending balance $ 33,237 $ 3,495 $ 2,906 $ 53,782 $ 36 $ 8,230 $ 101,686 Ending balance: Individually evaluated for impairment $ 12,361 $ — $ — $ 14,880 $ — $ — $ 27,241 Collectively evaluated for impairment 20,876 3,495 2,906 38,902 36 8,230 74,445 Total allowance for credit losses - loans and leases $ 33,237 $ 3,495 $ 2,906 $ 53,782 $ 36 $ 8,230 $ 101,686 2023 Commercial Real Estate Residential Real Estate Construction, Land Development, and Other Land Commercial and Industrial Installment and Other Lease Financing Receivables Total Loans and leases ending balance: Individually evaluated for impairment $ 64,339 $ 3,593 $ 813 $ 44,749 $ — $ — $ 113,494 Collectively evaluated for impairment 2,255,973 715,937 526,024 2,403,812 3,200 665,866 6,570,812 Total loans and leases $ 2,320,312 $ 719,530 $ 526,837 $ 2,448,561 $ 3,200 $ 665,866 $ 6,684,306 The allowance for credit losses increased $ 10.6 million for the year ended December 31, 2023 due to an acquisition adjustment on PCD loans related to the Inland transaction.
Biggest changeAND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table dollars in thousands, except share and per share data) Note 5—Loans and Lease Receivables and Allowance for Credit Losses (continued) 2023 Commercial Real Estate Residential Real Estate Construction, Land Development, and Other Land Commercial and Industrial Installment and Other Lease Financing Receivables Total Allowance for credit losses - loans and leases Beginning balance $ 26,061 $ 3,140 $ 3,134 $ 41,889 $ 24 $ 7,676 $ 81,924 Adjustment for acquired PCD loans 8,230 660 97 1,609 — — 10,596 Provision/(recapture) 7,237 ( 402 ) ( 325 ) 23,402 11 2,297 32,220 Charge-offs ( 9,729 ) ( 21 ) — ( 15,411 ) ( 3 ) ( 2,437 ) ( 27,601 ) Recoveries 1,438 118 — 2,293 4 694 4,547 Ending balance $ 33,237 $ 3,495 $ 2,906 $ 53,782 $ 36 $ 8,230 $ 101,686 Ending balance: Individually evaluated for impairment $ 12,361 $ — $ — $ 14,880 $ — $ — $ 27,241 Collectively evaluated for impairment 20,876 3,495 2,906 38,902 36 8,230 74,445 Total allowance for credit losses - loans and leases $ 33,237 $ 3,495 $ 2,906 $ 53,782 $ 36 $ 8,230 $ 101,686 2023 Commercial Real Estate Residential Real Estate Construction, Land Development, and Other Land Commercial and Industrial Installment and Other Lease Financing Receivables Total Loans and leases ending balance: Individually evaluated for impairment $ 64,339 $ 3,593 $ 813 $ 44,749 $ — $ — $ 113,494 Collectively evaluated for impairment 2,255,973 715,937 526,024 2,403,812 3,200 665,866 6,570,812 Total loans and leases $ 2,320,312 $ 719,530 $ 526,837 $ 2,448,561 $ 3,200 $ 665,866 $ 6,684,306 2022 Commercial Real Estate Residential Real Estate Construction, Land Development, and Other Land Commercial and Industrial Installment and Other Lease Financing Receivables Total Allowance for credit losses - loans and leases Beginning balance pre-CECL adoption $ 16,918 $ 1,628 $ 522 $ 33,129 $ 9 $ 2,806 $ 55,012 Impact of CECL adoption 6,367 1,047 1,191 1,253 9 2,301 $ 12,168 Provision/(recapture) 5,252 907 1,476 12,002 ( 9 ) 3,046 22,674 Charge-offs ( 3,837 ) ( 1,208 ) ( 94 ) ( 5,377 ) ( 7 ) ( 1,472 ) ( 11,995 ) Recoveries 1,361 766 39 882 22 995 4,065 Ending balance $ 26,061 $ 3,140 $ 3,134 $ 41,889 $ 24 $ 7,676 $ 81,924 Ending balance: Individually evaluated for impairment $ 6,101 $ — $ 265 $ 8,972 $ — $ — $ 15,338 Collectively evaluated for impairment 19,960 3,140 2,869 32,917 24 7,676 66,586 Total allowance for credit losses - loans and leases $ 26,061 $ 3,140 $ 3,134 $ 41,889 $ 24 $ 7,676 $ 81,924 2022 Commercial Real Estate Residential Real Estate Construction, Land Development, and Other Land Commercial and Industrial Installment and Other Lease Financing Receivables Total Loans and leases ending balance: Individually evaluated for impairment $ 37,959 $ 879 $ 5,541 $ 47,846 $ — $ — $ 92,225 Collectively evaluated for impairment 1,871,529 489,083 433,448 2,009,228 1,759 523,986 5,329,033 Total loans and leases $ 1,909,488 $ 489,962 $ 438,989 $ 2,057,074 $ 1,759 $ 523,986 $ 5,421,258 The Company decreased the allowance for credit losses - loans and leases by $ 3.7 million for the year ended December 31, 2024.
Allowance for credit losses - loans and leases —The allowance for credit losses - loans and leases is a valuation account that is deducted from the loans’ amortized cost basis to present the net amount expected to be collected on the loans. Loans are charged off against the allowance when management believes uncollectibility of loan is confirmed.
Allowance for credit losses - loans and leases —The allowance for credit losses - loans and leases is a valuation account that is deducted from the loans’ amortized cost basis to present the net amount expected to be collected on the loans. Loans are charged off against the allowance when management believes uncollectibility of a loan is confirmed.
The allowance for credit losses is measured on a collective (segment) basis when similar risk characteristics exist. Segments generally reflect underlying collateral categories as well taking into consideration the risk ratings and unguaranteed balance of small business loans.
The allowance for credit losses is measured on a collective (segment) basis when similar risk characteristics exist. Segments generally reflect underlying collateral categories as well as taking into consideration the risk ratings and unguaranteed balance of small business loans.
Customer relationship intangibles —Customer relationship intangibles relate to the value of existing trust and wealth management relationships and are amortized over 12 years. In valuing the relationship intangibles, the Company considered variables such as attrition, investment appreciation, and discount rates. 79 Table of Contents BYLINE BANCORP, INC.
Customer relationship intangibles relate to the value of existing trust and wealth management relationships and are amortized over 12 years. In valuing the relationship intangibles, the Company considered variables such as attrition, investment appreciation, and discount rates. 79 Table of Contents BYLINE BANCORP, INC.
Segment Reporting – Improvements to Reportable Segment Disclosures (Topic 280) – In November 2023, the FASB issued ASU 2023-07 to enhance disclosures about significant segment expenses for public entities reporting segment information under Topic 280. It requires that a public entity disclose, on an annual and interim basis, significant expense categories for each reportable segment.
Segment Reporting (Topic 280) – In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280) – Improvements to Reportable Segment Disclosures , to enhance disclosures about significant segment expenses for public entities reporting segment information under Topic 280. It requires that a public entity disclose, on an annual and interim basis, significant expense categories for each reportable segment.
Income Taxes – Improvements to Income Tax Disclosures (Topic 740) – In December 2023, the FASB issued ASU 2023-09 to provide additional transparency into an entity’s income tax disclosures primarily related to the rate reconciliation and income taxes paid information.
Income Taxes (Topic 740) – In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740) – Improvements to Income Tax Disclosures , to provide additional transparency into an entity’s income tax disclosures primarily related to the rate reconciliation and income taxes paid information.
On January 17, 2024, t he Company entered into a Letter Agreement with the Federal Reserve Bank of Chicago that allows the Bank to access the Bank Term Funding Program ("BTFP"). On January 22, 2024, the Company opened an advance of $ 200.0 million from the FRB as part of the BTFP.
On January 17, 2024, t he Company entered into a Letter Agreement with the Federal Reserve Bank of Chicago that allows the Bank to access the Bank Term Funding Program ("BTFP"). On January 22, 2024, the Bank opened an advance of $ 200.0 million from the FRB as part of the BTFP.
AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table dollars in thousands, except share and per share data) Note 17—Fair Value Measurement (continued) The Company has originated, and acquired through a business combination, servicing assets classified as Level 3 of the fair value hierarchy.
AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table dollars in thousands, except share and per share data) Note 17—Fair Value Measurement (continued) The Company has originated, and has acquired through a business combination, servicing assets classified as Level 3 of the fair value hierarchy.
For purposes of this disclosure, the amount of posted collateral by the Company and by counterparties is limited to the amount offsetting the derivative asset and derivative liability.
For purposes of this disclosure, the amount of posted collateral by the Company and counterparties is limited to the amount offsetting the derivative asset and derivative liability.
For the year ended December 31, 2022 First Quarter Second Quarter Third Quarter Fourth Quarter As Reported Adjustment Recast As Reported Adjustment Recast As Reported Adjustment Recast As Reported Interest and dividend income $ 61,818 $ ( 405 ) $ 61,413 $ 66,546 $ 133 $ 66,679 $ 79,903 $ ( 240 ) $ 79,663 $ 93,804 Interest expense 3,082 — 3,082 4,919 — 4,919 11,028 — 11,028 17,200 Net interest income 58,736 ( 405 ) 58,331 61,627 133 61,760 68,875 ( 240 ) 68,635 76,604 Provision/(recapture) for credit losses 4,995 1,564 6,559 5,908 ( 1,622 ) 4,286 4,176 3,032 7,208 5,826 Net interest income after provision/(recapture) for credit losses 53,741 ( 1,969 ) 51,772 55,719 1,755 57,474 64,699 ( 3,272 ) 61,427 70,778 Non-interest income 19,426 117 19,543 14,161 112 14,273 11,992 51 12,043 11,455 Non-interest expense 44,555 ( 599 ) 43,956 43,773 ( 188 ) 43,585 46,178 ( 137 ) 46,041 50,500 Income before provision for income taxes 28,612 ( 1,253 ) 27,359 26,107 2,055 28,162 30,513 ( 3,084 ) 27,429 31,733 Provision for income taxes 6,301 ( 340 ) 5,961 5,824 558 6,382 7,857 ( 837 ) 7,020 7,366 Net income 22,311 ( 913 ) 21,398 20,283 1,497 21,780 22,656 ( 2,247 ) 20,409 24,367 Dividends on preferred shares 196 — 196 — — — — — — — Income available to common stockholders $ 22,115 $ ( 913 ) $ 21,202 $ 20,283 $ 1,497 $ 21,780 $ 22,656 $ ( 2,247 ) $ 20,409 $ 24,367 Basic earnings per common share $ 0.60 $ ( 0.03 ) $ 0.57 $ 0.55 $ 0.04 $ 0.59 $ 0.61 $ ( 0.06 ) $ 0.55 $ 0.66 Diluted earnings per common share $ 0.58 $ ( 0.02 ) $ 0.56 $ 0.54 $ 0.04 $ 0.58 $ 0.61 $ ( 0.06 ) $ 0.55 $ 0.65 Table of Contents Item 9.
For the year ended December 31, 2022 First Quarter Second Quarter Third Quarter Fourth Quarter As Reported Adjustment Recast As Reported Adjustment Recast As Reported Adjustment Recast As Reported Interest and dividend income $ 61,818 $ ( 405 ) $ 61,413 $ 66,546 $ 133 $ 66,679 $ 79,903 $ ( 240 ) $ 79,663 $ 93,804 Interest expense 3,082 — 3,082 4,919 — 4,919 11,028 — 11,028 17,200 Net interest income 58,736 ( 405 ) 58,331 61,627 133 61,760 68,875 ( 240 ) 68,635 76,604 Provision/(recapture) for credit losses 4,995 1,564 6,559 5,908 ( 1,622 ) 4,286 4,176 3,032 7,208 5,826 Net interest income after provision/(recapture) for credit losses 53,741 ( 1,969 ) 51,772 55,719 1,755 57,474 64,699 ( 3,272 ) 61,427 70,778 Non-interest income 19,426 117 19,543 14,161 112 14,273 11,992 51 12,043 11,455 Non-interest expense 44,555 ( 599 ) 43,956 43,773 ( 188 ) 43,585 46,178 ( 137 ) 46,041 50,500 Income before provision for income taxes 28,612 ( 1,253 ) 27,359 26,107 2,055 28,162 30,513 ( 3,084 ) 27,429 31,733 Provision for income taxes 6,301 ( 340 ) 5,961 5,824 558 6,382 7,857 ( 837 ) 7,020 7,366 Net income 22,311 ( 913 ) 21,398 20,283 1,497 21,780 22,656 ( 2,247 ) 20,409 24,367 Dividends on preferred shares 196 — 196 — — — — — — — Income available to common stockholders $ 22,115 $ ( 913 ) $ 21,202 $ 20,283 $ 1,497 $ 21,780 $ 22,656 $ ( 2,247 ) $ 20,409 $ 24,367 Basic earnings per common share $ 0.60 $ ( 0.03 ) $ 0.57 $ 0.55 $ 0.04 $ 0.59 $ 0.61 $ ( 0.06 ) $ 0.55 $ 0.66 Diluted earnings per common share $ 0.58 $ ( 0.02 ) $ 0.56 $ 0.54 $ 0.04 $ 0.58 $ 0.61 $ ( 0.06 ) $ 0.55 $ 0.65 128 Table of Contents Item 9.
AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table dollars in thousands, except share and per share data) Note 3—Acquisition of a Business (continued) The following table presents a summary of the preliminary estimates of fair values of assets acquired and liabilities assumed as of the acquisition date: Assets Cash and cash equivalents $ 39,731 Securities available-for-sale 239,602 Restricted stock 3,058 Loans 808,000 Allowance for credit losses ( 10,596 ) Premises and equipment 11,307 Operating lease right-of-use asset 3,813 Other intangible assets 17,250 Bank-owned life insurance 12,455 Deferred tax assets, net 14,848 Other assets 21,023 Total assets acquired 1,160,491 Liabilities Deposits 964,491 Federal Home Loan Bank advances 40,000 Securities sold under agreements to repurchase 455 Junior subordinated debentures 32,661 Operating lease liability 4,034 Accrued expenses and other liabilities 13,288 Total liabilities assumed 1,054,929 Net assets acquired $ 105,562 Consideration paid Common stock ( 5,932,323 shares issued at $ 18.09 per share) 107,017 Cash paid 31,897 Total consideration paid 138,914 Goodwill $ 33,352 84 Table of Contents BYLINE BANCORP, INC.
AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table dollars in thousands, except share and per share data) Note 3—Acquisition of a Business (continued) The following table presents a summary of the fair values of assets acquired and liabilities assumed as of the acquisition date: Assets Cash and cash equivalents $ 39,731 Securities available-for-sale 239,602 Restricted stock 3,058 Loans 808,000 Allowance for credit losses ( 10,596 ) Premises and equipment 11,307 Operating lease right-of-use asset 3,813 Other intangible assets 17,250 Bank-owned life insurance 12,455 Deferred tax assets, net 14,848 Other assets 21,023 Total assets acquired 1,160,491 Liabilities Deposits 964,491 Federal Home Loan Bank advances 40,000 Securities sold under agreements to repurchase 455 Junior subordinated debentures 32,661 Operating lease liability 4,034 Accrued expenses and other liabilities 13,288 Total liabilities assumed 1,054,929 Net assets acquired $ 105,562 Consideration paid Common stock ( 5,932,323 shares issued at $ 18.09 per share) 107,017 Cash paid 31,897 Total consideration paid 138,914 Goodwill $ 33,352 84 Table of Contents BYLINE BANCORP, INC.
Recognized acquisition-related expenses and other adjustments related to the timing of expenses, are included in net income in the following table: Year Ended December 31, 2023 2022 Total revenues (net interest income and non-interest income) $ 411,252 $ 391,621 Net income $ 120,246 $ 97,724 Earnings per share—basic $ 2.80 $ 2.28 Earnings per share—diluted $ 2.77 $ 2.25 The operating results of the Company include the operating results generated by the acquired assets and assumed liabilities of Inland for the period from July 1, 2023 through December 31, 2023.
Recognized acquisition-related expenses and other adjustments related to the timing of expenses, are included in net income in the following table: Year Ended December 31, 2023 (unaudited) 2022 (unaudited) Total revenues (net interest income and non-interest income) $ 411,252 $ 391,621 Net income $ 120,246 $ 97,724 Earnings per share—basic $ 2.80 $ 2.28 Earnings per share—diluted $ 2.77 $ 2.25 The operating results of the Company include the operating results generated by the acquired assets and assumed liabilities of Inland for the period from July 1, 2023 through December 31, 2023.
Refer to Note 18—Share-Based Compensation for additional information. Earnings per share —Earnings per common share ("EPS") is computed under the two-class method. Pursuant to the two-class method, non-vested stock-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents are participating securities and are included in the computation of EPS.
Refer to Note 18—Share-Based Compensation for additional information. Earnings per share —Earnings per common share ("EPS") is computed under the two-class method. Pursuant to the two-class method, non-vested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents are participating securities and are included in the computation of EPS.
The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing a separate opinion on the critical audit matters or on the accounts or disclosures to which it relates.
The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Operating expenses of such properties, net of related income, and gains and losses on their disposition are included in non‑interest expense. Any losses on the sales of other real estate owned properties are recognized immediately. OREO is recorded net of participating interests sold.
Operating expenses of such properties, net of related income, and gains and losses on their disposition are included in non‑interest expense. Any gains or losses on the sales of other real estate owned properties are recognized immediately. OREO is recorded net of participating interests sold.
The Company uses its incremental borrowing rate at leases commencement to calculate the present value of lease payments when the rate implicit in a lease is not known. The Company's incremental borrowing rate is based on the FHLB regular advance rate, adjusted for the lease term and other factors.
The Company uses its incremental borrowing rate at lease commencement to calculate the present value of lease payments when the rate implicit in a lease is not known. The Company's incremental borrowing rate is based on the FHLB regular advance rate, adjusted for the lease term and other factors.
AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table dollars in thousands, except share and per share data) Note 4—Securities (continued) Gross unrealized losses and fair values, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of December 31, 2023 and 2022 are summarized as follows: Less than 12 Months 12 Months or Longer Total 2023 # of Securities Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Available-for-sale U.S.
AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table dollars in thousands, except share and per share data) Note 4—Securities (continued) Gross unrealized losses and fair values, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position as of December 31, 2024 and 2023 are summarized as follows: Less than 12 Months 12 Months or Longer Total 2024 # of Securities Fair Value Unrealized Losses Fair Value Unrealized Losses Fair Value Unrealized Losses Available-for-sale U.S.
AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table dollars in thousands, except share and per share data) Note 5—Loans and Lease Receivables and Allowance for Credit Losses (continued) December 31, 2023 Term loans amortized cost by origination year Revolving Total 2023 2022 2021 2020 2019 Prior Loans Loans Commercial Real Estate Pass $ 247,856 $ 452,127 $ 516,624 $ 229,053 $ 143,283 $ 388,872 $ 28,360 $ 2,006,175 Watch 12,501 22,094 26,408 46,713 20,364 68,003 — 196,083 Special Mention — 799 10,752 2,618 12,751 25,790 — 52,710 Substandard — 2,888 5,841 1,771 7,483 46,532 829 65,344 Total $ 260,357 $ 477,908 $ 559,625 $ 280,155 $ 183,881 $ 529,197 $ 29,189 $ 2,320,312 Gross charge-offs, year ended December 31, 2023 $ — $ 193 $ 60 $ 1,511 $ 4,054 $ 3,911 $ — $ 9,729 Residential Real Estate Pass $ 55,178 $ 135,477 $ 104,005 $ 54,651 $ 37,806 $ 225,593 $ 57,865 $ 670,575 Watch — 4,811 — 17,417 7,167 8,708 1,597 39,700 Special Mention — — — 3,594 127 1 413 4,135 Substandard — — 107 189 349 3,523 952 5,120 Total $ 55,178 $ 140,288 $ 104,112 $ 75,851 $ 45,449 $ 237,825 $ 60,827 $ 719,530 Gross charge-offs, year ended December 31, 2023 $ — $ — $ — $ — $ — $ 21 $ — $ 21 Construction, Land Development, & Land Pass $ 82,449 $ 145,174 $ 184,544 $ 35,466 $ 9,772 $ 1,429 $ 174 $ 459,008 Watch 1,392 13,990 21,313 18,716 3,125 — — 58,536 Special Mention — — 9,279 — — — — 9,279 Substandard — — — — — 14 — 14 Total $ 83,841 $ 159,164 $ 215,136 $ 54,182 $ 12,897 $ 1,443 $ 174 $ 526,837 Gross charge-offs, year ended December 31, 2023 $ — $ — $ — $ — $ — $ — $ — $ — Commercial & Industrial Pass $ 475,720 $ 514,902 $ 288,392 $ 109,430 $ 73,059 $ 147,168 $ 524,348 $ 2,133,019 Watch 41,027 33,080 50,407 1,385 6,951 18,180 39,531 190,561 Special Mention — 6,164 10,595 2,631 1,112 6,643 36,354 63,499 Substandard — 7,332 6,067 6,431 10,116 18,381 13,155 61,482 Total $ 516,747 $ 561,478 $ 355,461 $ 119,877 $ 91,238 $ 190,372 $ 613,388 $ 2,448,561 Gross charge-offs, year ended December 31, 2023 $ 1,518 $ 1,938 $ 5,372 $ 4,451 $ 1,087 $ 1,045 $ — $ 15,411 Installment and Other Pass $ 564 $ 132 $ 79 $ 133 $ 28 $ 424 $ 1,814 $ 3,174 Watch — — 25 — — 1 — 26 Special Mention — — — — — — — — Substandard — — — — — — — — Total $ 564 $ 132 $ 104 $ 133 $ 28 $ 425 $ 1,814 $ 3,200 Gross charge-offs, year ended December 31, 2023 $ — $ — $ — $ — $ — $ 3 $ — $ 3 Lease Financing Receivables Pass $ 327,099 $ 207,640 $ 93,242 $ 29,343 $ 5,443 $ 856 $ — $ 663,623 Watch — 67 1,008 16 — — — 1,091 Special Mention — — — 179 101 36 — 316 Substandard 259 138 384 55 — — — 836 Total $ 327,358 $ 207,845 $ 94,634 $ 29,593 $ 5,544 $ 892 $ — $ 665,866 Gross charge-offs, year ended December 31, 2023 $ 734 $ 886 $ 549 $ 139 $ 75 $ 54 $ — $ 2,437 Total Loans and Leases Pass $ 1,188,866 $ 1,455,452 $ 1,186,886 $ 458,076 $ 269,391 $ 764,342 $ 612,561 $ 5,935,574 Watch 54,920 74,042 99,161 84,247 37,607 94,892 41,128 485,997 Special Mention — 6,963 30,626 9,022 14,091 32,470 36,767 129,939 Substandard 259 10,358 12,399 8,446 17,948 68,450 14,936 132,796 Total $ 1,244,045 $ 1,546,815 $ 1,329,072 $ 559,791 $ 339,037 $ 960,154 $ 705,392 $ 6,684,306 Gross charge-offs, year ended December 31, 2023 $ 2,252 $ 3,017 $ 5,981 $ 6,101 $ 5,216 $ 5,034 $ — $ 27,601 92 Table of Contents BYLINE BANCORP, INC.
AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table dollars in thousands, except share and per share data) Note 5—Loans and Lease Receivables and Allowance for Credit Losses (continued) December 31, 2023 Term loans amortized cost by origination year Revolving Total 2023 2022 2021 2020 2019 Prior Loans Loans Commercial Real Estate Pass $ 247,856 $ 452,127 $ 516,624 $ 229,053 $ 143,283 $ 388,872 $ 28,360 $ 2,006,175 Watch 12,501 22,094 26,408 46,713 20,364 68,003 — 196,083 Special Mention — 799 10,752 2,618 12,751 25,790 — 52,710 Substandard — 2,888 5,841 1,771 7,483 46,532 829 65,344 Total $ 260,357 $ 477,908 $ 559,625 $ 280,155 $ 183,881 $ 529,197 $ 29,189 $ 2,320,312 Gross charge-offs, year ended December 31, 2023 $ — $ 193 $ 60 $ 1,511 $ 4,054 $ 3,911 $ — $ 9,729 Residential Real Estate Pass $ 55,178 $ 135,477 $ 104,005 $ 54,651 $ 37,806 $ 225,593 $ 57,865 $ 670,575 Watch — 4,811 — 17,417 7,167 8,708 1,597 39,700 Special Mention — — — 3,594 127 1 413 4,135 Substandard — — 107 189 349 3,523 952 5,120 Total $ 55,178 $ 140,288 $ 104,112 $ 75,851 $ 45,449 $ 237,825 $ 60,827 $ 719,530 Gross charge-offs, year ended December 31, 2023 $ — $ — $ — $ — $ — $ 21 $ — $ 21 Construction, Land Development, & Other Land Pass $ 82,449 $ 145,174 $ 184,544 $ 35,466 $ 9,772 $ 1,429 $ 174 $ 459,008 Watch 1,392 13,990 21,313 18,716 3,125 — — 58,536 Special Mention — — 9,279 — — — — 9,279 Substandard — — — — — 14 — 14 Total $ 83,841 $ 159,164 $ 215,136 $ 54,182 $ 12,897 $ 1,443 $ 174 $ 526,837 Gross charge-offs, year ended December 31, 2023 $ — $ — $ — $ — $ — $ — $ — $ — Commercial & Industrial Pass $ 475,720 $ 514,902 $ 288,392 $ 109,430 $ 73,059 $ 147,168 $ 524,348 $ 2,133,019 Watch 41,027 33,080 50,407 1,385 6,951 18,180 39,531 190,561 Special Mention — 6,164 10,595 2,631 1,112 6,643 36,354 63,499 Substandard — 7,332 6,067 6,431 10,116 18,381 13,155 61,482 Total $ 516,747 $ 561,478 $ 355,461 $ 119,877 $ 91,238 $ 190,372 $ 613,388 $ 2,448,561 Gross charge-offs, year ended December 31, 2023 $ 1,518 $ 1,938 $ 5,372 $ 4,451 $ 1,087 $ 1,045 $ — $ 15,411 Installment and Other Pass $ 564 $ 132 $ 79 $ 133 $ 28 $ 424 $ 1,814 $ 3,174 Watch — — 25 — — 1 — 26 Special Mention — — — — — — — — Substandard — — — — — — — — Total $ 564 $ 132 $ 104 $ 133 $ 28 $ 425 $ 1,814 $ 3,200 Gross charge-offs, year ended December 31, 2023 $ — $ — $ — $ — $ — $ 3 $ — $ 3 Lease Financing Receivables Pass $ 327,099 $ 207,640 $ 93,242 $ 29,343 $ 5,443 $ 856 $ — $ 663,623 Watch — 67 1,008 16 — — — 1,091 Special Mention — — — 179 101 36 — 316 Substandard 259 138 384 55 — — — 836 Total $ 327,358 $ 207,845 $ 94,634 $ 29,593 $ 5,544 $ 892 $ — $ 665,866 Gross charge-offs, year ended December 31, 2023 $ 734 $ 886 $ 549 $ 139 $ 75 $ 54 $ — $ 2,437 Total Loans and Leases Pass $ 1,188,866 $ 1,455,452 $ 1,186,886 $ 458,076 $ 269,391 $ 764,342 $ 612,561 $ 5,935,574 Watch 54,920 74,042 99,161 84,247 37,607 94,892 41,128 485,997 Special Mention — 6,963 30,626 9,022 14,091 32,470 36,767 129,939 Substandard 259 10,358 12,399 8,446 17,948 68,450 14,936 132,796 Total $ 1,244,045 $ 1,546,815 $ 1,329,072 $ 559,791 $ 339,037 $ 960,154 $ 705,392 $ 6,684,306 Gross charge-offs, year ended December 31, 2023 $ 2,252 $ 3,017 $ 5,981 $ 6,101 $ 5,216 $ 5,034 $ — $ 27,601 For the years ended December 31, 2024 and 2023, there were no loans or leases which were risk rated Doubtful or Loss. 93 Table of Contents BYLINE BANCORP, INC.
Accumulated other comprehensive income also includes the amortization of the remaining balance related to terminated interest rate swaps designated as cash flow hedges, which are over the original life of the cash flow hedge.
Accumulated other comprehensive income (loss) also includes the amortization of the remaining balance related to terminated interest rate swaps designated as cash flow hedges, which are over the original life of the cash flow hedge.
AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table dollars in thousands, except share and per share data) Note 5—Loans and Lease Receivables and Allowance for Credit Losses (continued) The following tables summarize contractual delinquency information of the loans and leases considered for inclusion in the allowance for credit losses - loans and leases calculation at December 31, 2023 and December 31, 2022: December 31, 2023 2023 2022 2021 2020 2019 Prior Revolving Loans Total Loans Commercial Real Estate Current $ 259,998 $ 474,878 $ 558,236 $ 279,098 $ 178,729 $ 501,620 $ 29,189 $ 2,281,748 30-59 Days Past Due 359 648 638 74 3,176 484 — 5,379 60-89 Days Past Due — 826 — 286 — 1,208 — 2,320 Greater than 90 Accruing — — — — — — — — Non-accrual — 1,556 751 697 1,976 25,885 — 30,865 Total Past Due 359 3,030 1,389 1,057 5,152 27,577 — 38,564 Total $ 260,357 $ 477,908 $ 559,625 $ 280,155 $ 183,881 $ 529,197 $ 29,189 $ 2,320,312 Residential Real Estate Current $ 55,178 $ 136,448 $ 102,973 $ 75,125 $ 45,050 $ 230,102 $ 59,476 $ 704,352 30-59 Days Past Due — 3,840 1,032 537 29 4,122 399 9,959 60-89 Days Past Due — — — — 21 127 — 148 Greater than 90 Accruing — — — — — — — — Non-accrual — — 107 189 349 3,474 952 5,071 Total Past Due — 3,840 1,139 726 399 7,723 1,351 15,178 Total $ 55,178 $ 140,288 $ 104,112 $ 75,851 $ 45,449 $ 237,825 $ 60,827 $ 719,530 Construction, Land Development, & Land Current $ 83,841 $ 156,815 $ 215,136 $ 54,182 $ 12,897 $ 1,443 $ 174 $ 524,488 30-59 Days Past Due — — — — — — — — 60-89 Days Past Due — 2,349 — — — — — 2,349 Greater than 90 Accruing — — — — — — — — Non-accrual — — — — — — — — Total Past Due — 2,349 — — — — — 2,349 Total $ 83,841 $ 159,164 $ 215,136 $ 54,182 $ 12,897 $ 1,443 $ 174 $ 526,837 Commercial & Industrial Current $ 516,747 $ 552,251 $ 351,534 $ 114,859 $ 83,780 $ 177,239 $ 611,766 $ 2,408,176 30-59 Days Past Due — 1,545 1,099 238 2,513 400 455 6,250 60-89 Days Past Due — 1,505 — 234 3,416 1,139 496 6,790 Greater than 90 Accruing — — — — — — — — Non-accrual — 6,177 2,828 4,546 1,529 11,594 671 27,345 Total Past Due — 9,227 3,927 5,018 7,458 13,133 1,622 40,385 Total $ 516,747 $ 561,478 $ 355,461 $ 119,877 $ 91,238 $ 190,372 $ 613,388 $ 2,448,561 Installment and Other Current $ 564 $ 132 $ 104 $ 133 $ 28 $ 425 $ 1,814 $ 3,200 30-59 Days Past Due — — — — — — — — 60-89 Days Past Due — — — — — — — — Greater than 90 Accruing — — — — — — — — Non-accrual — — — — — — — — Total Past Due — — — — — — — — Total $ 564 $ 132 $ 104 $ 133 $ 28 $ 425 $ 1,814 $ 3,200 Lease Financing Receivables Current $ 325,833 $ 206,800 $ 93,795 $ 29,292 $ 5,537 $ 889 $ — $ 662,146 30-59 Days Past Due 726 426 153 38 4 2 — 1,349 60-89 Days Past Due 540 481 302 218 3 1 — 1,545 Greater than 90 Accruing — — — — — — — — Non-accrual 259 138 384 45 — — — 826 Total Past Due 1,525 1,045 839 301 7 3 — 3,720 Total $ 327,358 $ 207,845 $ 94,634 $ 29,593 $ 5,544 $ 892 $ — $ 665,866 Total Loans and Leases Current $ 1,242,161 $ 1,527,324 $ 1,321,778 $ 552,689 $ 326,021 $ 911,718 $ 702,419 $ 6,584,110 30-59 Days Past Due 1,085 6,459 2,922 887 5,722 5,008 854 22,937 60-89 Days Past Due 540 5,161 302 738 3,440 2,475 496 13,152 Greater than 90 Accruing — — — — — — — — Non-accrual 259 7,871 4,070 5,477 3,854 40,953 1,623 64,107 Total Past Due 1,884 19,491 7,294 7,102 13,016 48,436 2,973 100,196 Total $ 1,244,045 $ 1,546,815 $ 1,329,072 $ 559,791 $ 339,037 $ 960,154 $ 705,392 $ 6,684,306 94 Table of Contents BYLINE BANCORP, INC.
AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table dollars in thousands, except share and per share data) Note 5—Loans and Lease Receivables and Allowance for Credit Losses (continued) December 31, 2023 2023 2022 2021 2020 2019 Prior Revolving Loans Total Loans Commercial Real Estate Current $ 259,998 $ 474,878 $ 558,236 $ 279,098 $ 178,729 $ 501,620 $ 29,189 $ 2,281,748 30-59 Days Past Due 359 648 638 74 3,176 484 — 5,379 60-89 Days Past Due — 826 — 286 — 1,208 — 2,320 Greater than 90 Accruing — — — — — — — — Non-accrual — 1,556 751 697 1,976 25,885 — 30,865 Total Past Due 359 3,030 1,389 1,057 5,152 27,577 — 38,564 Total $ 260,357 $ 477,908 $ 559,625 $ 280,155 $ 183,881 $ 529,197 $ 29,189 $ 2,320,312 Residential Real Estate Current $ 55,178 $ 136,448 $ 102,973 $ 75,125 $ 45,050 $ 230,102 $ 59,476 $ 704,352 30-59 Days Past Due — 3,840 1,032 537 29 4,122 399 9,959 60-89 Days Past Due — — — — 21 127 — 148 Greater than 90 Accruing — — — — — — — — Non-accrual — — 107 189 349 3,474 952 5,071 Total Past Due — 3,840 1,139 726 399 7,723 1,351 15,178 Total $ 55,178 $ 140,288 $ 104,112 $ 75,851 $ 45,449 $ 237,825 $ 60,827 $ 719,530 Construction, Land Development, & Other Land Current $ 83,841 $ 156,815 $ 215,136 $ 54,182 $ 12,897 $ 1,443 $ 174 $ 524,488 30-59 Days Past Due — — — — — — — — 60-89 Days Past Due — 2,349 — — — — — 2,349 Greater than 90 Accruing — — — — — — — — Non-accrual — — — — — — — — Total Past Due — 2,349 — — — — — 2,349 Total $ 83,841 $ 159,164 $ 215,136 $ 54,182 $ 12,897 $ 1,443 $ 174 $ 526,837 Commercial & Industrial Current $ 516,747 $ 552,251 $ 351,534 $ 114,859 $ 83,780 $ 177,239 $ 611,766 $ 2,408,176 30-59 Days Past Due — 1,545 1,099 238 2,513 400 455 6,250 60-89 Days Past Due — 1,505 — 234 3,416 1,139 496 6,790 Greater than 90 Accruing — — — — — — — — Non-accrual — 6,177 2,828 4,546 1,529 11,594 671 27,345 Total Past Due — 9,227 3,927 5,018 7,458 13,133 1,622 40,385 Total $ 516,747 $ 561,478 $ 355,461 $ 119,877 $ 91,238 $ 190,372 $ 613,388 $ 2,448,561 Installment and Other Current $ 564 $ 132 $ 104 $ 133 $ 28 $ 425 $ 1,814 $ 3,200 30-59 Days Past Due — — — — — — — — 60-89 Days Past Due — — — — — — — — Greater than 90 Accruing — — — — — — — — Non-accrual — — — — — — — — Total Past Due — — — — — — — — Total $ 564 $ 132 $ 104 $ 133 $ 28 $ 425 $ 1,814 $ 3,200 Lease Financing Receivables Current $ 325,833 $ 206,800 $ 93,795 $ 29,292 $ 5,537 $ 889 $ — $ 662,146 30-59 Days Past Due 726 426 153 38 4 2 — 1,349 60-89 Days Past Due 540 481 302 218 3 1 — 1,545 Greater than 90 Accruing — — — — — — — — Non-accrual 259 138 384 45 — — — 826 Total Past Due 1,525 1,045 839 301 7 3 — 3,720 Total $ 327,358 $ 207,845 $ 94,634 $ 29,593 $ 5,544 $ 892 $ — $ 665,866 Total Loans and Leases Current $ 1,242,161 $ 1,527,324 $ 1,321,778 $ 552,689 $ 326,021 $ 911,718 $ 702,419 $ 6,584,110 30-59 Days Past Due 1,085 6,459 2,922 887 5,722 5,008 854 22,937 60-89 Days Past Due 540 5,161 302 738 3,440 2,475 496 13,152 Greater than 90 Accruing — — — — — — — — Non-accrual 259 7,871 4,070 5,477 3,854 40,953 1,623 64,107 Total Past Due 1,884 19,491 7,294 7,102 13,016 48,436 2,973 100,196 Total $ 1,244,045 $ 1,546,815 $ 1,329,072 $ 559,791 $ 339,037 $ 960,154 $ 705,392 $ 6,684,306 95 Table of Contents BYLINE BANCORP, INC.
We manage the interest rate risk associated with our interest-bearing liabilities by managing the interest rates and tenors associated with our borrowings from the FHLB, and deposits from our customers that we rely on for funding.
We manage the interest rate risk associated with our interest-bearing liabilities by managing the interest rates and tenors associated with our borrowings from the FHLB, our other borrowings, and deposits from our customers that we rely on for funding.
AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table dollars in thousands, except share and per share data) Note 4—Securities The following tables summarize the amortized cost and fair values of securities available-for-sale, securities held-to-maturity and equity and other securities at December 31, 2023 and 2022 and the corresponding amounts of gross unrealized gains and losses: 2023 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Available-for-sale U.S.
AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table dollars in thousands, except share and per share data) Note 4—Securities The following tables summarize the amortized cost and fair values of securities available-for-sale, securities held-to-maturity and equity and other securities at December 31, 2024 and 2023 and the corresponding amounts of gross unrealized gains and losses: 2024 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Available-for-sale U.S.
AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table dollars in thousands, except share and per share data) Note 16—Commitments and Contingent Liabilities (continued) Commitments to make loans are generally made for periods of 90 days or less. The fixed rate loan commitments have interest rates ranging from 1.00 % to 15.00 % and maturities up to 2053 .
AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table dollars in thousands, except share and per share data) Note 16—Commitments and Contingent Liabilities (continued) Commitments to make loans are generally made for periods of 90 days or less. The fixed rate loan commitments have interest rates ranging from 1.00 % to 15.00 % and maturities up to 2052 .
The results of the simulations are hypothetical, and a variety of factors might cause actual results to differ substantially from what is depicted, including: the timing, magnitude, and frequency of interest rate changes, changes in market conditions, depositor behavior changes, and management strategies. 62 Table of Contents Ite m 8. Financial Statements and Supplementary Data. BYLINE BANCORP, INC.
The results of the simulations are hypothetical, and a variety of factors might cause actual results to differ substantially from what is depicted, including: the timing, magnitude, and frequency of interest rate changes, changes in market conditions, depositor behavior changes, and management strategies. 63 Table of Contents Ite m 8. Financial Statements and Supplementary Data. BYLINE BANCORP, INC.
Government and its agencies, in an amount greater than 10 % of stockholders’ equity. At December 31, 2023, the amortized cost and fair value of debt securities are shown by contractual maturity. Expected maturities may differ from contractual maturities if borrowers have the right to call or prepay obligations with or without call or prepayment penalties.
Government and its agencies, in an amount greater than 10 % of stockholders’ equity. At December 31, 2024, the amortized cost and fair value of debt securities are shown by contractual maturity. Expected maturities may differ from contractual maturities if borrowers have the right to call or prepay obligations with or without call or prepayment penalties.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2023 and 2022, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2023, in conformity with accounting principles generally accepted in the United States of America.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2024 and 2023, and the consolidated results of its operations and its cash flows for each of the three years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America.
The Company acquired single‑issuer trust preferred securities which are categorized as Level 3 of the fair value hierarchy. These securities are classified as equity securities consistent with accounting guidance. The Company did no t have any transfers to or from Level 1 and Level 2 of the fair value hierarchy during the years ended December 31, 2023 and 2022.
The Company acquired single‑issuer trust preferred securities which are categorized as Level 3 of the fair value hierarchy. These securities are classified as equity securities consistent with accounting guidance. The Company did no t have any transfers to or from Level 1 and Level 2 of the fair value hierarchy during the years ended December 31, 2024 and 2023.
No stock option compensation expense was recognized for the years ended December 31, 2023, 2022 and 2021. Pursuant to the terms of the Agreement and Plan of Merger with First Evanston and its subsidiaries, dated as of November 27, 2017 (the "First Evanston Merger Agreement"), each outstanding First Evanston option held by a participant in the First Evanston Bancorp, Inc.
No stock option compensation expense was recognized for the years ended December 31, 2024, 2023, and 2022. Pursuant to the terms of the Agreement and Plan of Merger with First Evanston and its subsidiaries, dated as of November 27, 2017 (the "First Evanston Merger Agreement"), each outstanding First Evanston option held by a participant in the First Evanston Bancorp, Inc.
Our EVE simulation model incorporates various assumptions, which we believe are reasonable but which may have a significant impact on results such as: (1) asset prepayment speed assumptions, (2) deposit decay rate assumptions, (3) predefined credit spreads for both investment securities and loans (4) re-pricing characteristics for market-rate-sensitive instruments on and off balance sheet, (5) amortization schedule, and (6) discount rates associated with the products on balance sheet. 61 Table of Contents Potential changes to our net interest income and economic value of equity in hypothetical rising and declining interest rate scenarios calculated as of December 31, 2023 are presented below.
Our EVE simulation model incorporates various assumptions, which we believe are reasonable but which may have a significant impact on results such as: (1) asset prepayment speed assumptions, (2) deposit decay rate assumptions, (3) predefined credit spreads for both investment securities and loans (4) re-pricing characteristics for market-rate-sensitive instruments on and off balance sheet, (5) amortization schedule, and (6) discount rates associated with the products on balance sheet. 62 Table of Contents Potential changes to our net interest income and economic value of equity in hypothetical rising and declining interest rate scenarios calculated as of December 31, 2024 are presented below.
AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table dollars in thousands, except share and per share data) Note 10—Goodwill, Core Deposit Intangible and Other Intangible Assets The Company’s annual goodwill test was performed as of November 30, 2023. The Company determined that no impairment existed as of that date.
AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Table dollars in thousands, except share and per share data) Note 10—Goodwill, Core Deposit Intangible and Other Intangible Assets The Company’s annual goodwill test was performed as of November 30, 2024. The Company determined that no impairment existed as of that date.
The number of performance-based shares which may be earned under the award is dependent upon the Company’s total stockholder return and return on average assets, weighted equally, over a three-year period ending December 31, 2026, measured against the KBW Regional Bank Index.
The number of performance-based shares which may be earned under the award is dependent upon the Company’s total stockholder return and return on average assets, weighted equally, over a three-year period ending December 31, 2027, measured against the KBW Regional Bank Index.
Refer to Note 14—Subordinated Notes and Junior Subordinated Debentures, for additional discussion. Dollars within footnote tables disclosed within the consolidated financial statements are presented in thousands, except share and per share data. Operating results include the years ended December 31, 2023, 2022 and 2021 .
Refer to Note 14—Subordinated Notes and Junior Subordinated Debentures, for additional discussion. Dollars within footnote tables disclosed within the consolidated financial statements are presented in thousands, except share and per share data. Operating results include the years ended December 31, 2024, 2023, and 2022 .
A deferred tax valuation allowance is established to reduce the net carrying amount of deferred tax assets if it is determined to be more likely than not that all or some of the deferred tax asset will not be realized. At December 31, 2023 and 2022, the Company did not record a deferred tax valuation allowance.
A deferred tax valuation allowance is established to reduce the net carrying amount of deferred tax assets if it is determined to be more likely than not that all or some of the deferred tax asset will not be realized. At December 31, 2024 and 2023, the Company did not record a deferred tax valuation allowance.
The trust preferred securities issued by each trust rank equally with the common securities in right of payment, except that if an event of default under the indenture governing the notes has occurred and is continuing, the preferred securities will rank senior to the common securities in right of payment. 108 Table of Contents BYLINE BANCORP, INC.
The trust preferred securities issued by each trust rank equally with the common securities in right of payment, except that if an event of default under the indenture governing the notes has occurred and is continuing, the preferred securities will rank senior to the common securities in right of payment. 109 Table of Contents BYLINE BANCORP, INC.
Stock volatility was computed as the average of the volatilities of peer group companies. All outstanding stock options were fully vested and exercisable at December 31, 2023. The fair values of the stock options were determined using the Black-Scholes-Merton model for Time Options and a Monte Carlo simulation model for Performance Options.
Stock volatility was computed as the average of the volatilities of peer group companies. All outstanding stock options were fully vested and exercisable at December 31, 2024. The fair values of the stock options were determined using the Black-Scholes-Merton model for Time Options and a Monte Carlo simulation model for Performance Options.
At December 31, 2023, and 2022 there were no securities pledged for advances from the Federal Home Loan Bank. Other securities were pledged for derivative positions, letters of credit and for purposes required or permitted by law. At December 31, 2023 and 2022 , there were no holdings of securities of any one issuer, other than the U.S.
At December 31, 2024 and 2023 , there were no securities pledged for advances from the Federal Home Loan Bank. Other securities were pledged for derivative positions, letters of credit and for purposes required or permitted by law. At December 31, 2024 and 2023 , there were no holdings of securities of any one issuer, other than the U.S.
As of December 31, 2023 and 2022 , there were no outstanding advances under the FRB discount window lin e. The Company pledges loans and leases as collateral for the FRB discount window borrowing. Refer to Note 5—Loan and Lease Receivables and Allowance for Credit Losses for additional discussion.
As of December 31, 2024 and 2023 , there were no outstanding advances under the FRB discount window lin e. The Company pledges loans and leases as collateral for the FRB discount window borrowing. Refer to Note 5—Loan and Lease Receivables and Allowance for Credit Losses for additional discussion.
The reduction applied by the Company is one notch lower (i.e., a "AA" rating for a comparable bond would be reduced to "AA-" for the Company’s valuation). In 2023 and 2022, all of the ratings derived by the Company were "BBB-" or better with and without comparable bond proxies.
The reduction applied by the Company is one notch lower (i.e., a "AA" rating for a comparable bond would be reduced to "AA-" for the Company’s valuation). In 2024 and 2023, all of the ratings derived by the Company were "BBB-" or better with and without comparable bond proxies.
Loan and lease receivables, net —For certain variable rate loans that reprice frequently and with no significant changes in credit risk, fair value is estimated at carrying value. The fair value of other types of loans is estimated using an exit price notion for 2023 and 2022 values.
Loan and lease receivables, net —For certain variable rate loans that reprice frequently and with no significant changes in credit risk, fair value is estimated at carrying value. The fair value of other types of loans is estimated using an exit price notion for 2024 and 2023 values.
As a result, a t December 31, 2023 and 2022, there was no reserve balance required to be maintained at the FRB. Equity and other securities —Equity and other securities have no stated maturities and may be sold in response to the same environmental factors as securities available for sale.
As a result, a t December 31, 2024 and 2023, there was no reserve balance required to be maintained at the FRB. Equity and other securities —Equity and other securities have no stated maturities and may be sold in response to the same environmental factors as securities available for sale.
There was no recorded allowance for credit losses on securities as of December 31, 2023 or 2022. Changes in the allowance for credit losses would be recorded as a provision for credit losses. Losses would be charged against the allowance when management believes the security is uncollectible or management intends to sell or is required to sell the security.
There was no recorded allowance for credit losses on securities as of December 31, 2024 or 2023 . Changes in the allowance for credit losses would be recorded as a provision for credit losses. Losses would be charged against the allowance when management believes the security is uncollectible or management intends to sell or is required to sell the security.
The extended expiration of the Company’s NLD carryforwards are from December 31, 2031 to December 31, 2043 . The Company and the Bank file consolidated income tax returns. The Company and the Bank are no longer subject to United States federal income tax examinations for years before 2020 and state income tax examinations for years before 2019.
The extended expiration of the Company’s NLD carryforwards are from December 31, 2031 to December 31, 2043 . The Company and the Bank file consolidated income tax returns. The Company and the Bank are no longer subject to United States federal income tax examinations for years before 2021 and state income tax examinations for years before 2020.
From time to time, non-recurring fair value adjustments to other real estate owned are recorded to reflect partial write-downs based on an observable market price or current appraised value of property. 112 Table of Contents BYLINE BANCORP, INC.
From time to time, non-recurring fair value adjustments to other real estate owned are recorded to reflect partial write-downs based on an observable market price or current appraised value of property. 113 Table of Contents BYLINE BANCORP, INC.
As of December 31, 2023, the most recent notification from the FDIC categorized the Bank as well‑capitalized under the framework for prompt corrective action. There are no conditions or events since that notification that management believes have changed the Bank’s category.
As of December 31, 2024, the most recent notification from the FDIC categorized the Bank as well‑capitalized under the framework for prompt corrective action. There are no conditions or events since that notification that management believes have changed the Bank’s category.
As of December 31, 2023 , the cash flow hedges aggregating $ 650.0 million in notional amounts are comprised of $ 450.0 million pay-fixed interest rate swaps associated with certain deposits and other borrowings, and $ 200.0 million receive-fixed interest rate swaps associated with certain variable rate loans.
As of December 31, 2024 , the cash flow hedges aggregating $ 650.0 million in notional amounts are comprised of $ 450.0 million pay-fixed interest rate swaps associated with certain deposits and other borrowings, and $ 200.0 million receive-fixed interest rate swaps associated with certain variable rate loans.
The Company recorded $ 4.8 million and $ 3.0 million of right-of-use lease assets in exchange for operating lease liabilities for the years ended December 31, 2023 and 2022, respectively. In 2023, the additions recorded to right-of-use assets and operating lease liabilities included $ 3.8 million related to the acquisition of Inland.
The Company recorded $ 2.3 million, $ 4.8 million, and $ 3.0 million of right-of-use lease assets in exchange for operating lease liabilities for the years ended December 31, 2024, 2023, and 2022, respectively. In 2023, the additions recorded to right-of-use assets and operating lease liabilities included $ 3.8 million related to the acquisition of Inland.
We also have audited the Company’s internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
We also have audited the Company’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
The Bank originates commercial, commercial real estate and consumer loans and leases, U.S. government guaranteed loans, and receives deposits from customers located primarily in the Chicago, Illinois metropolitan area. The Bank operates 47 Chicago metropolitan area and one Wauwatosa, Wisconsin, banking offices.
The Bank originates commercial, commercial real estate and consumer loans and leases, U.S. government guaranteed loans, and receives deposits from customers located primarily in the Chicago, Illinois metropolitan area. The Bank operates 45 Chicago metropolitan area and one Wauwatosa, Wisconsin, banking offices.
Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023, based on criteria established in Internal Control – Integrated Framework (2013) issued by COSO.
Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control - Integrated Framework (2013) issued by COSO.
Repurchased shares are recorded as treasury shares on the trade date using the treasury stock method, and the cash paid is recorded as treasury stock. Treasury stock acquired is recorded at cost and is carried as a reduction of stockholders’ equity in the Consolidated Statement of Financial Condition.
Repurchased shares are recorded as treasury shares on the trade date using the treasury stock method, and the cash paid is recorded as treasury stock. Treasury stock acquired is recorded at cost and is carried as a reduction of stockholders’ equity in the Consolidated Statements of Financial Condition.
The following tables summarize the risk rating categories of the loans and leases considered for inclusion in the allowance for credit losses calculation as of December 31, 2023 and 2022. 91 Table of Contents BYLINE BANCORP, INC.
The following tables summarize the risk rating categories of the loans and leases considered for inclusion in the allowance for credit losses calculation as of December 31, 2024 and 2023. 91 Table of Contents BYLINE BANCORP, INC.
The fair value of fixed-maturity certificates of deposit is estimated by discounting future cash flows, using rates currently offered for deposits of similar remaining maturities. 113 Table of Contents BYLINE BANCORP, INC.
The fair value of fixed-maturity certificates of deposit is estimated by discounting future cash flows, using rates currently offered for deposits of similar remaining maturities. 114 Table of Contents BYLINE BANCORP, INC.
Management does not believe there are any such matters that will have a material effect on the Consolidated Financial Statements for the years ended December 31, 2023, 2022, and 2021 .
Management does not believe there are any such matters that will have a material effect on the Consolidated Financial Statements for the years ended December 31, 2024, 2023, and 2022 .
There were no profit sharing contributions to the Plan for the years ended December 31, 2023, 2022, or 2021. The net assets of the Plan are not included in the Consolidated Statements of Financial Condition.
There were no profit sharing contributions to the Plan for the years ended December 31, 2024, 2023, or 2022. The net assets of the Plan are not included in the Consolidated Statements of Financial Condition.
Additionally, once an acquired non-credit-deteriorated loan or purchases credit deteriorated ("PCD") loan is performing and reaches its contractual maturity date, it is re-underwritten, and if renewed, it is classified as an originated loan.
Additionally, once an acquired non-credit-deteriorated loan or purchased credit deteriorated ("PCD") loan is performing and reaches its contractual maturity date, it is re-underwritten, and if renewed, it is classified as an originated loan.
In addition to the above required lease payments, the Company has contractual obligations related primarily to information technology contracts and other maintenance contracts. 103 Table of Contents BYLINE BANCORP, INC.
In addition to the above required lease payments, the Company has contractual obligations related primarily to information technology contracts and other maintenance contracts. 104 Table of Contents BYLINE BANCORP, INC.
Securities —Securities are classified as available‑for‑sale if the instrument may be sold in response to such factors including changes in market interest rates and related changes in prepayment risk, needs for liquidity, changes in the availability of and the yield on alternative instruments, and changes in funding sources and terms.
Debt s ecurities —Debt securities are classified as available‑for‑sale if the instrument may be sold in response to such factors including changes in market interest rates and related changes in prepayment risk, needs for liquidity, changes in the availability of and the yield on alternative instruments, and changes in funding sources and terms.
As of December 31, 2023 and 2022 , the Company had no material uncertain tax positions. The Company elects to treat interest and penalties recognized for the underpayment of income taxes as income tax expense.
As of December 31, 2024 and 2023 , the Company had no material uncertain tax positions. The Company elects to treat interest and penalties recognized for the underpayment of income taxes as income tax expense.
Total expense for the employer contributions made to the Plan wer e $ 3.3 million, $ 3.0 million and, $ 2.6 million during the years ended December 31, 2023, 2022 and 2021, respectively. On June 14, 2017, the Company’s Board of Directors adopted the Byline Bancorp, Inc.
Total expense for the employer contributions made to the Plan wer e $ 3.6 million, $ 3.3 million, and $ 3.0 million during the years ended December 31, 2024, 2023, and 2022, respectively. On June 14, 2017, the Company’s Board of Directors adopted the Byline Bancorp, Inc.
There were no non-vested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents as of December 31, 2023, 2022 or 2021.
There were no non-vested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents as of December 31, 2024, 2023 or 2022.
The Company’s held-to-maturity portfolio contains municipal bonds that are typically rated by major rating agencies as ‘Aa’ or better. The Company uses industry historical credit loss information adjusted for current conditions to establish an allowance for credit losses.
The Company’s held-to-maturity portfolio consisted of municipal bonds that are typically rated by major rating agencies as ‘Aa’ or better. The Company uses industry historical credit loss information adjusted for current conditions to establish an allowance for credit losses.
CONSOLIDATED FINANCIAL STATEMENTS December 31, 2023, 2022, and 2021 INDEX Report of Independent Registered Public Accounting Firm 64 Consolidated Statements of Financial Condition as of December 31, 2023 and 2022 68 Consolidated Statements of Operations for the Years Ended December 31, 2023, 2022, and 2021 69 Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2023, 2022, and 2021 70 Consolidated Statements of Changes in Stockholders’ Equity for the Years Ended December 31, 2023, 2022, and 2021 71 Consolidated Statements of Cash Flows for the Years Ended December 31, 2023, 2022 and 2021 72 Notes to the Consolidated Financial Statements 74 63 Table of Contents Report of Independe nt Registered Public Accounting Firm To the Stockholders and the Board of Directors of Byline Bancorp, Inc. and Subsidiaries Opinions on the Financial Statements and Internal Control over Financial Reporting We have audited the accompanying consolidated statements of financial condition of Byline Bancorp, Inc. and Subsidiaries (the “Company”) as of December 31, 2023 and 2022, the related consolidated statements of operations, comprehensive income (loss), changes in stockholders’ equity, and cash flows for each of the three years in the period ended December 31, 2023, and the related notes (collectively referred to as the consolidated financial statements).
CONSOLIDATED FINANCIAL STATEMENTS December 31, 2024, 2023, and 2022 INDEX Report of Independent Registered Public Accounting Firm 65 Consolidated Statements of Financial Condition as of December 31, 2024 and 2023 68 Consolidated Statements of Operations for the Years Ended December 31, 2024, 2023, and 2022 69 Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2024, 2023, and 2022 70 Consolidated Statements of Changes in Stockholders’ Equity for the Years Ended December 31, 2024, 2023, and 2022 71 Consolidated Statements of Cash Flows for the Years Ended December 31, 2024, 2023, and 2022 72 Notes to the Consolidated Financial Statements 74 64 Table of Contents Report of Independe nt Registered Public Accounting Firm To the Stockholders and the Board of Directors of Byline Bancorp, Inc. and Subsidiaries Opinions on the Financial Statements and Internal Control over Financial Reporting We have audited the accompanying consolidated statements of financial condition of Byline Bancorp, Inc. and Subsidiaries (the “Company”) as of December 31, 2024 and 2023, the related consolidated statements of operations, comprehensive income (loss), changes in stockholders’ equity, and cash flows for each of the three years in the period ended December 31, 2024, and the related notes (collectively referred to as the “consolidated financial statements”).
The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. 109 Table of Contents BYLINE BANCORP, INC.
The credit risk involved in issuing letters of credit is essentially the same as that involved in extending loan facilities to customers. 110 Table of Contents BYLINE BANCORP, INC.
Beginning on September 15, 2023, the interest rate reset to the three-month SOFR plus a tenor spread adjustment of 0.26161 % plus 1.78 % ( 7.43 % and 6.55 % at December 31, 2023 and 2022, respectively), which is in effect until the debentures mature in 2035. Interest is paid on a quarterly basis.
Beginning on September 15, 2023, the interest rate reset to the three-month SOFR plus a tenor spread adjustment of 0.26161 % plus 1.78 % ( 6.40 % and 7.43 % at December 31, 2024 and 2023, respectively), which is in effect until the debentures mature in 2035. Interest is paid on a quarterly basis.
The credit risk related to the other credit derivatives assumed by the Company is managed through the Company’s loan underwriting process. Additionally, the Company enters into foreign currency contracts to manage foreign exchange risk associated with certain customer foreign currency transactions. These transactions were not material to the consolidated financial statements as of December 31, 2023, or 2022.
The credit risk related to the other credit derivatives assumed by the Company is managed through the Company’s loan underwriting process. Additionally, the Company enters into foreign currency contracts to manage foreign exchange risk associated with certain customer foreign currency transactions. These transactions were not material to the consolidated financial statements as of December 31, 2024 and 2023.
Accrued interest receivable on securities available-for-sale and held-to-maturity totaled $ 4.5 million and $ 3.9 million at December 31, 2023 and December 31, 2022, respectively, and are excluded from the estimate of credit losses.
Accrued interest receivable on securities available-for-sale and held-to-maturity totaled $ 4.9 million and $ 4.5 million at December 31, 2024 and December 31, 2023, respectively, and are excluded from the estimate of credit losses.
The description of the conversion process is based on, and qualified by, the First Evanston Merger Agreement. 116 Table of Contents BYLINE BANCORP, INC.
The description of the conversion process is based on, and qualified by, the First Evanston Merger Agreement. 117 Table of Contents BYLINE BANCORP, INC.
As of December 31, 2023 and 2022, there were no material loans made to the related parties as described. Deposits from related parties —Deposits from related parties were not material as of December 31, 2023 and 2022.
As of December 31, 2024 and 2023, there were no material loans made to the related parties as described. Deposits from related parties —Deposits from related parties were not material as of December 31, 2024 and 2023.
Beginning on September 14, 2023, the interest rate reset to the three-month CME Secured Overnight Financing Rate ("SOFR") plus a tenor spread adjustment of 0.26161 % plus 2.79 % ( 8.43 % and 7.53 % at December 31, 2023 and 2022, respectively). Interest is paid on a quarterly basis.
Beginning on September 14, 2023, the interest rate reset to the three-month CME Secured Overnight Financing Rate ("SOFR") plus a tenor spread adjustment of 0.26161 % plus 2.79 % ( 7.40 % and 8.43 % at December 31, 2024 and 2023, respectively). Interest is paid on a quarterly basis.
Loan servicing asset revaluation, which represents the changes in fair value of servicing assets, totaled downward valuations of $ 5.1 million, $ 11.7 million, and $ 6.7 million for the years ended December 31, 2023, 2022 and 2021, respectively. Changes in the fair value of the loan servicing asset are reported on the Consolidated Statement of Operations.
Loan servicing asset revaluation, which represents the changes in fair value of servicing assets, totaled downward valuations of $ 6.7 million, $ 5.1 million, and $ 11.7 million for the years ended December 31, 2024, 2023, and 2022, respectively. Changes in the fair value of the loan servicing asset are reported on the Consolidated Statements of Operations.
Refer to Note 21—Derivative Instruments and Hedging Activities for additional discussion. 106 Table of Contents BYLINE BANCORP, INC.
Refer to Note 21—Derivative Instruments and Hedging Activities for additional discussion. 108 Table of Contents BYLINE BANCORP, INC.
The transaction resulted in debt issuance costs of approximately $ 1.7 million that are being amortized over 10 years . As of December 31, 2023 and 2022 , the liability outstanding relating to the subordinated notes, net of unamortized debt issuance costs, was $ 73.9 million and $ 73.7 million, respectively.
The transaction resulted in debt issuance costs of approximately $ 1.7 million that are being amortized over 10 years . As of December 31, 2024 and 2023, the liability outstanding relating to the subordinated notes, net of unamortized debt issuance costs, was $ 74.0 million and $ 73.9 million, respectively.
The difference between the initial amortized cost basis and the par value of the loan is a noncredit discount or premium, which is amortized into interest income over the life of the loan. Subsequent changes to the allowance for credit losses are recorded through credit loss expense.
The difference between the initial amortized cost basis and the par value of the loan is a noncredit discount or premium, which is amortized into interest income over the life of the loan. Subsequent changes to the allowance for credit losses are recorded through a provision (recapture) for credit losses.
Issued Accounting Pronouncements Pending Adoption Fair Value Measurement (Topic 820) – In June 2022, the FASB issued ASU No. 2022-03, Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions.
Adopted Accounting Pronouncements Fair Value Measurement (Topic 820) – In June 2022, the FASB issued ASU No. 2022-03, Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions .
These dividends represent the Company’s primary cash flow from operating activities used to service its obligations. For years ended December 31, 2023 and 2022, the Company received $ 35.0 million and $ 24.0 million, respectively, in cash dividends from Byline Bank.
These dividends represent the Company’s primary cash flow from operating activities used to service its obligations. For the years ended December 31, 2024 and 2023, the Company received $ 46.0 million and $ 35.0 million, respectively, in cash dividends from Byline Bank.
The transaction resulted in a gain of $ 4.2 million, net of tax, which was the clean value at termination date and began amortizing as a decrease to interest expense on the effective dates. The remaining unamortized balance was $ 3.7 million and $ 15,000 as of December 31, 2023 and 2022, respectively.
The transaction resulted in a gain of $ 4.2 million, net of tax, which was the clean value at termination date and began amortizing as a decrease to interest expense on the effective dates. The remaining unamortized balance was $ 2.9 million and $ 3.7 million as of December 31, 2024 and 2023, respectively.
If the Company had breached any of these provisions at December 31, 2023 , it could have been required to settle its obligations under the agreements at their termination value less offsetting positions of $ 925,000 .
If the Company had breached any of these provisions at December 31, 2024 , it could have been required to settle its obligations under the agreements at their termination value less offsetting positions of $ 415,000 .
The following table reflects amounts included in non-interest income in the Consolidated Statements of Operations relating to derivative instruments that are not designated in a hedging relationship for the years ended December 31, 2023, 2022, and 2021: 2023 2022 2021 Other interest rate derivatives $ ( 174 ) $ 702 $ 541 Other credit derivatives — 5 12 Total $ ( 174 ) $ 707 $ 553 The Company records interest rate derivatives subject to master netting agreements at their gross value and does not offset derivative asset and liabilities on the Consolidated Statements of Financial Condition.
The following table reflects amounts included in non-interest income in the Consolidated Statements of Operations relating to derivative instruments that are not designated in a hedging relationship for the years ended December 31, 2024, 2023, and 2022: 2024 2023 2022 Other interest rate derivatives $ ( 42 ) $ ( 174 ) $ 702 Other credit derivatives ( 18 ) - 5 Total $ ( 60 ) $ ( 174 ) $ 707 The Company records interest rate derivatives subject to master netting agreements at their gross value and does not offset derivative asset and liabilities on the Consolidated Statements of Financial Condition.
At December 31, 2023 , the variable rate line of credit had a $ 11.3 million outstanding balance and an interest rate of 7.39 %. At December 31, 2022 , the line of credit had no outstanding balance.
At December 31, 2024 the line of credit had no outstanding balance. At December 31, 2023 , the line of credit had a $ 11.3 million outstanding balance and an interest rate of 7.39 %.
The fair values of the credit derivatives is reflected in other assets and liabilities with corresponding gains or losses reflected in non-interest income or other comprehensive income.
The fair values of the credit derivatives is reflected in accrued interest receivable and other assets and accrued interest payable and other liabilities with corresponding gains or losses reflected in non-interest income or other comprehensive income.

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