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Mergers and Acquisitions | 9 Months Ended
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Sep. 30, 2025
Business Combination [Abstract] |
Mergers and Acquisitions | NOTE 2. MERGERS AND ACQUISITIONS On February 28, 2025, Wesbanco completed its acquisition of Premier Financial Corp. ("PFC"), a bank holding company headquartered in Defiance, OH. On the acquisition date, PFC had approximately $7.9 billion in assets, excluding goodwill and intangible assets, which included approximately $5.9 billion in portfolio loans and $1.2 billion in investment securities. The PFC acquisition was valued at $1.0 billion, based on Wesbanco's closing stock price per share on February 28, 2025 of $35.07, and resulted in all of PFC's common shares outstanding immediately prior to the effectiveness of the acquisition, as well as certain of PFC's outstanding equity awards, converting into the right to receive 28,738,104 shares of Wesbanco common stock in the aggregate, of which 20,316,670 were newly issued shares and 8,421,434 were treasury shares. Following completion of the acquisition, PFC shareholders represent approximately 30% of the voting interests in Wesbanco. With the acquisition of PFC, Wesbanco acquired 73 branches and increased its market share in Ohio, while expanding into contiguous markets in northwestern Ohio and Michigan. The assets and liabilities of PFC were recorded on Wesbanco's balance sheets at their preliminary estimated fair values as of February 28, 2025, the acquisition date, and PFC's results of operations have been included in Wesbanco's Consolidated Statements of Income since that date. Based on a preliminary purchase price allocation, Wesbanco recorded $481.4 million in goodwill and $145.6 million in core deposit intangibles in its Community Banking segment, and $6.9 million in customer list intangibles in its Trust and Investment Services segment, which reflects the expected synergies and economies of scale resulting from the acquisition. None of the goodwill is deductible for income tax purposes as the acquisition is accounted for as a tax-free exchange for tax purposes. As a result of the integration of the operations of PFC, it is not practicable to determine revenue or net income included in Wesbanco’s operating results relating to PFC since the date of acquisition, as PFC's results cannot be separately identified. For the three and nine months ended September 30, 2025, Wesbanco recorded merger-related expenses of $4.0 million and $57.4 million, respectively, associated with the PFC acquisition. The preliminary purchase price of the PFC acquisition and resulting goodwill is summarized as follows:
(unaudited, in thousands) |  | February 28, 2025 |
Purchase price: |  |  |
Fair value of Wesbanco shares issued |  | $ | 1,007,845 |
Cash consideration for outstanding PFC shares |  |  | 138 |
Total purchase price |  | $ | 1,007,983 |
Fair value of: |  |  |
Tangible assets acquired |  | $ | 7,735,477 |
Core deposit and other intangible assets acquired |  |  | 152,488 |
Liabilities assumed |  |  | (7,561,996 | )
Net cash received in the acquisition |  |  | 200,592 |
Fair value of net assets acquired |  |  | 526,561 |
Goodwill recognized |  | $ | 481,422 |
The PFC acquisition was accounted for under the acquisition method of accounting. Assets acquired and liabilities assumed in the acquisition were recorded at their respective acquisition date estimated fair values. These estimates were recorded based on initial valuations available at the acquisition date, and these estimates, including initial accounting for deferred taxes, are considered preliminary as of September 30, 2025, and subject to adjustment for up to one year after the acquisition date. In many cases, the determination of fair value required management to make estimates about discount rates, expected future cash flows, market conditions and other future events that are highly subjective in nature and subject to change. While the Company believes that the information available on the acquisition date provided a reasonable basis for estimating fair value, additional information may be obtained during the measurement period that would result in changes to the estimated fair value amounts. The measurement period ends on the earlier of one year after the acquisition date or the date the Company concludes that all necessary information about the facts and circumstances that existed as of the acquisition date have been obtained. Management anticipates that facts obtained during the measurement period could result in adjustments to the valuation amounts presented herein. The following table presents the amounts recognized as of the acquisition date for each major class of assets acquired and liabilities assumed:
(unaudited, in thousands) |  | February 28, 2025 |
Total merger consideration |  |  |  | $ | 1,007,983 |
Fair value of assets acquired |  |  |  |  |
Cash and due from banks |  | $ | 200,592 |  |  |
Equity securities |  |  | 14,601 |  |  |
Available-for-sale debt securities |  |  | 1,149,980 |  |  |
Loans held for sale |  |  | 169,607 |  |  |
Net portfolio loans |  |  | 5,890,376 |  |  |
Premises and equipment |  |  | 59,046 |  |  |
Accrued interest receivable |  |  | 35,682 |  |  |
Intangible assets |  |  | 152,488 |  |  |
Bank-owned life insurance |  |  | 186,736 |  |  |
Deferred taxes |  |  | 96,398 |  |  |
Other assets |  |  | 133,051 |  |  |
Total assets acquired |  | $ | 8,088,557 |  |  |
Fair value of liabilities assumed |  |  |  |  |
Deposits |  | $ | 6,873,339 |  |  |
FHLB borrowings |  |  | 502,028 |  |  |
Subordinated debt and junior subordinated debt |  |  | 80,606 |  |  |
Accrued interest payable |  |  | 3,620 |  |  |
Other liabilities |  |  | 102,403 |  |  |
Total liabilities assumed |  | $ | 7,561,996 |  |  |
Net assets acquired |  |  |  | $ | 526,561 |
Goodwill |  |  |  | $ | 481,422 |
The following table presents the changes in the allocation of the purchase price of the assets acquired and the liabilities assumed at the date of the acquisition previously reported as of June 30, 2025:
(unaudited, in thousands) |  | February 28, 2025 |
Goodwill recognized as of June 30, 2025 |  | $ | 476,175 |
Change in fair value of net assets acquired: |  |  |
Assets |  |  |
Loans held for sale |  |  | (1,345 | )
Net portfolio loans |  |  | 1,410 |
Intangible assets |  |  | (5,918 | )
Deferred tax assets |  |  | (1,416 | )
Accrued income and other assets |  |  | 2,592 |
Liabilities |  |  |
Deposits |  |  | 108 |
Accrued expenses and other liabilities |  |  | (678 | )
Total change in fair value of net assets acquired |  | $ | (5,247 | )
Increase in goodwill recognized |  |  | 5,247 |
Goodwill recognized as of September 30, 2025 |  | $ | 481,422 |
The fair value estimates for loans, deferred taxes, other assets and other liabilities have continued to fluctuate as the final valuations and reclassifications are completed. The Company expects to finalize the fair values and corresponding goodwill balance within one year of the date of the acquisition. The following is a description of the methods used to determine the fair values of significant assets and liabilities presented above. Cash and due from banks – The carrying amount of these items is a reasonable estimate of their fair value based on the short-term nature of these assets. Investment securities – The fair value of equity securities are determined by obtaining quoted prices on nationally recognized securities exchanges. The fair value of available-for-sale debt securities are determined by obtaining quoted prices or by using matrix pricing, which is a mathematical technique used widely in the industry to value debt securities without relying exclusively on quoted prices for the specific securities but rather by relying on the securities’ relationship to other similar securities. Valuations of positions that are not traded in active markets, which consist of certain specific private placement municipal debt issues, are generated using assumptions not observable in the market or management’s best estimate for which the credit quality and discount rate must be estimated. The actual sales prices of securities were used as the fair value for those securities sold in March 2025, immediately following the acquisition date, rather than the quoted market price as sales prices were determined to be the best indicator of fair value as of the acquisition date. Loans held for sale – Commercial loans in the loans held for sale portfolio were recorded at fair value based on estimated bids from third parties. For residential loans held for sale, the use of a valuation model using quoted prices of similar instruments were significant inputs in arriving at the fair value. Net portfolio loans – A valuation of the portfolio loans was performed by a third party as of the acquisition date to assess the fair value. The portfolio was segmented into three groups, including performing purchased credit deteriorated ("PCD") loans, non-accrual PCD loans and non-PCD loans. The loans were further pooled based on loan type and interest rate terms. The loans were valued at the pool level using a discounted cash flow methodology. The methodology included projecting cash flows based on the contractual terms of the loans and the cash flows were adjusted to reflect credit loss expectations along with prepayments. Discount rates were developed based on the relative risk of the cash flows, taking into consideration the loan type, market rates as of the valuation date, recent originations in the portfolio, credit loss expectations, and liquidity expectations. Lastly, cash flows adjusted for credit loss expectations were discounted to present value and summed to arrive at the fair value of the loans. Loans acquired in the PFC acquisition were reviewed to identify any that had experienced a more-than-insignificant deterioration in credit quality since origination. Loans that met established criteria indicating such deterioration are classified as purchased credit deteriorated ("PCD") loans. These loans are recorded at the purchase price net of expected allowance for credit losses at the time of acquisition. In addition, a non-credit discount or premium is allocated to the PCD loans based on a valuation by a third-party specialist. Under this method, the acquired PCD loans do not incur a provision for credit losses affecting net income at acquisition. However, changes to the allowance for these PCD loans in subsequent periods would be recognized through the provision for credit losses. Of the $5.9 billion in loans held for investment acquired from PFC, $5.7 billion were identified as non-PCD and $0.2 billion were identified as PCD. The non-PCD loans have an amortized cost of $6.0 billion and interest and credit marks that total $0.3 billion. The PCD loans are summarized in the following table:
(unaudited, in thousands) |  |  |
Amortized cost of acquired PCD loans |  | $ | 247,641 |
Allowance on PCD at acquisition (1) |  |  | (22,226 | )
Non-credit discount on PCD |  |  | (19,453 | )
Fair value price of PCD loans |  | $ | 205,962 |
(1) The allowance on PCD loans at acquisition date increased $2.0 million as compared to what was previously reported due to the refinements of certain individually-evaluated credits in the allowance calculation. Premises and equipment - The fair values of premises are based on a market approach by obtaining third-party appraisals and broker opinions of value for land, office and branch space. Core deposit intangible – The core deposit intangible represents the low cost of funding acquired core deposits provide relative to the Company’s marginal cost of funds. The fair value was estimated based on a cost savings methodology that gave consideration to expected customer attrition rates, net maintenance cost of the deposit base, interest costs associated with customer deposits, and the alternative cost of funds. The estimated fair value was grossed-up for the expected tax amortization benefit. The intangible asset is being amortized over 10 years using an accelerated method, based upon the period over which estimated economic benefits are estimated to be received. Deposits – The fair values used for demand, savings and money market deposits are equal to the amount payable on demand at the acquisition date. The fair value of time deposits is estimated by discounting the estimated future cash flows using current rates offered for deposits with similar remaining maturities. FHLB Borrowings – The fair value of Federal Home Loan Bank ("FHLB") advances is estimated by discounting the estimated future cash flows using rates currently available to the Company for debt with similar remaining maturities. Subordinated debt and junior subordinated debt – The fair value of subordinated debt and junior subordinated debt is estimated by discounting the estimated future cash flows by using comparable corporate bond indices and swap rates from the financial services sector and factoring in the applicable credit spreads and optional early redemption provisions. The operating results of the Company include the operating results produced by the acquired assets and assumed liabilities in the acquisition for the period March 1, 2025 to September 30, 2025. The following table presents unaudited pro forma information as if the acquisition had occurred on January 1, 2024. The pro forma adjustments give effect to any change in interest income due to the accretion of the discount associated with the fair value adjustments to acquired loans, any change in interest expense due to estimated premium amortization/discount accretion associated with the fair value adjustment to acquired interest-bearing deposits, borrowings and long-term debt and the amortization of the core deposit intangible that would have resulted had the deposits been acquired as of January 1, 2024. The pro forma information is not indicative of what would have occurred had the acquisition occurred as of the beginning of the year prior to the acquisition date. The pro forma amounts below do not reflect any adjustments to the provision for credit losses for acquired loans, or the Company's expectations as of the date of the pro forma information of further operating cost savings and other business synergies expected to be achieved, including revenue growth as a result of the acquisition. As a result, actual amounts differed from the unaudited pro forma information presented.
|  | For the Three Months Ended September 30, |  |  | For the Nine Months Ended September 30, |
(unaudited, in thousands) |  | 2025 (1) |  |  | 2024 (2) |  |  | 2025 (3) |  |  | 2024 (4) |
Net interest income |  | $ | 201,276 |  |  | $ | 190,033 |  |  | $ | 606,049 |  |  | $ | 565,565 |
Non-interest income |  |  | 45,324 |  |  |  | 42,186 |  |  |  | 135,972 |  |  |  | 128,744 |
Net income |  | $ | 70,110 |  |  | $ | 60,745 |  |  | $ | 212,085 |  |  | $ | 179,847 |
(1) Includes the net impact of after-tax purchase accounting accretion adjustments from the PFC acquisition totaling $7.3 million for the three months ended September 30, 2025. (2) Includes the net impact of after-tax purchase accounting accretion adjustments from the PFC acquisition totaling $9.3 million for the three months ended September 30, 2024. (3) Includes the net impact of after-tax purchase accounting accretion adjustments from the PFC acquisition totaling $23.7 million for the nine months ended September 30, 2025. (4) Includes the net impact of after-tax purchase accounting accretion adjustments from the PFC acquisition totaling $34.9 million for the nine months ended September 30, 2024.

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