EX-99.1 8 cubi8kproformaex991.htm EX-99.1
CUSTOMERS BANCORP, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
On January 4, 2021, Customers Bancorp, Inc., a Pennsylvania corporation, (“Customers Bancorp”), completed the previously announced divestiture of its Bank Mobile business to MFAC Merger Sub Inc., a Pennsy lvania corporation and an indirect wholly-owned subsidiary of Megalith Financial Acquisition Corp., a Delaware corporation ("Megalith"), pursuant to an Agreement and Plan of Merger, dated August 6, 2020, by and among Megalith, MFAC Merger Sub Inc., BankMobile, Customers Bank, a Pennsylvania state chartered bank and the sole stockholder of Bank Mobile ("Customers Bank"), and Customers Bancorp, the parent bank holding company for Customers Bank (as amended on November 2, 2020 and December 8, 2020, the "Divestiture"). In connection with the closing of the Divestiture, Megalith changed its name to “BM Technologies, Inc.” (“BMT”). Beginning in the first quarter of 2021, BankMobile’s historical financial results for periods prior to the Divestiture will be reflected in Customers Bancorp’s consolidated financial statements as discontinued operations.
The unaudited pro forma condensed consolidated financial information is prepared in accordance with Article 11 of Regulation S-X. The following unaudited pro forma condensed consolidated statements of income and comprehensive income (loss) of Customers Bancorp for the nine months ended September 30, 2020 and for the year ended December 31, 2019 are presented as if the Divestiture had occurred as of January 1, 2019 and gives effect to the elimination of the historical BankMobile financial results, as well as other pro forma adjustments due to the Divestiture. The unaudited pro forma condensed consolidated statements of income and comprehensive income (loss) for the year ended December 31, 2018 and 2017 are presented with the elimination of the historical BankMobile financial results as discontinued operations. The unaudited pro forma condensed consolidated balance sheet as of September 30, 2020 is presented as if the Divestiture had occurred as of September 30, 2020.
The following pro forma financial statements are based on information currently available, including certain assumptions and estimates. They are intended for informational purposes only, and do not purport to represent what Customers Bancorp’s financial position and results of operations actually would have been had the Divestiture occurred on the dates indicated, or to project Customers Bancorp’s financial position or results of operations for any future date or period.
The information in the “Historical” columns in the unaudited pro forma condensed consolidated statements of income and comprehensive income (loss) and the unaudited pro forma condensed consolidated balance sheet were derived from Customers Bancorp’s historical consolidated financial statements for the periods and as of the date presented and does not reflect any adjustments related to the Divestiture and related events. The unaudited pro forma condensed consolidated financial statements and the accompanying notes should be read in conjunction with the audited consolidated financial statements, the accompanying notes and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” included in Customers Bancorp’s Annual Report on Form 10-K for the year ended December 31, 2019 and Customers Bancorp's Quarterly Report on Form 10-Q for the nine months ended September 30, 2020.
The information in the “BankMobile Divestiture” columns in the unaudited pro forma condensed consolidated statements of income and comprehensive income and the unaudited pro forma condensed consolidated balance sheet have been prepared in accordance with the discontinued operations guidance in Accounting Standards Codification 205, “Financial Statement Presentation” and therefore does not reflect what BankMobile’s results of operations would have been on a stand-alone basis and are not necessarily indicative of BankMobile’s future results of operations.
The information in the “Transaction Accounting Adjustments” and "Other Transaction Accounting Adjustments" columns in the unaudited pro forma condensed consolidated statements of income and comprehensive income (loss) and the unaudited pro forma condensed consolidated balance sheet reflect additional pro forma adjustments which are further described in the accompanying notes.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
As of September 30, 2020
(amounts in thousands)

| Historical Customers Bancorp (a) | BankMobile Divestiture (b) | Transaction Accounting Adjustments | Notes | Other Transaction Accounting Adjustments | Notes | Pro Forma Customers Bancorp
ASSETS |  |  |  |  |  |  |
Cash and due from banks | $ | 5,822 |  | $ | — |  | $ | — |  |  | $ | — |  |  | $ | 5,822 |
Interest earning deposits | 325,594 |  | (16,776) |  | 23,125 |  | (c) | 25,610 |  | (d), (f) | 357,553 |
Cash and cash equivalents | 331,416 |  | (16,776) |  | 23,125 |  |  | 25,610 |  |  | 363,375 |
Investment securities, at fair value | 1,133,831 |  | — |  | — |  |  | — |  |  | 1,133,831 |
Loans held for sale, at fair value | 26,689 |  | — |  | — |  |  | — |  |  | 26,689 |
Loans receivable, mortgage warehouse, at fair value | 3,913,593 |  | — |  | — |  |  | — |  |  | 3,913,593 |
Loans receivable, PPP | 4,964,105 |  | — |  | — |  |  | — |  |  | 4,964,105 |
Loans and leases receivable | 7,700,892 |  | — |  | — |  |  | 31,166 |  | (e), (f) | 7,732,058 |
Allowance for credit losses on loans and leases | (155,561) |  | — |  | — |  |  | — |  |  | (155,561) |
Total loans and leases receivable, net of allowance for credit losses on loans and leases | 16,423,029 |  | — |  | — |  |  | 31,166 |  |  | 16,454,195 |
FHLB, Federal Reserve Bank, and other restricted stock | 70,387 |  | — |  | — |  |  | — |  |  | 70,387 |
Accrued interest receivable | 65,668 |  | — |  | — |  |  | 1,681 |  | (e) | 67,349 |
Bank premises and equipment, net | 11,744 |  | (436) |  | — |  |  | — |  |  | 11,308 |
Bank-owned life insurance | 277,826 |  | — |  | — |  |  | — |  |  | 277,826 |
Other real estate owned | 131 |  | — |  | — |  |  | — |  |  | 131 |
Goodwill and other intangibles | 14,437 |  | (10,408) |  | — |  |  | — |  |  | 4,029 |
Other assets | 423,569 |  | (52,914) |  | — |  |  | — |  |  | 370,655 |
Total assets | $ | 18,778,727 |  | $ | (80,534) |  | $ | 23,125 |  |  | $ | 58,457 |  |  | $ | 18,779,775 |
LIABILITIES AND SHAREHOLDERS’ EQUITY |  |  |  |  |  |  |
Liabilities: |  |  |  |  |  |  |
Deposits: |  |  |  |  |  |  |
Demand, non-interest bearing | $ | 2,327,017 |  | $ | — |  | $ | — |  |  | $ | — |  |  | $ | 2,327,017 |
Interest bearing | 8,512,060 |  | — |  | — |  |  | 16,776 |  | (d) | 8,528,836 |
Total deposits | 10,839,077 |  | — |  | — |  |  | 16,776 |  |  | 10,855,853 |
Federal funds purchased | 680,000 |  | — |  | — |  |  | — |  |  | 680,000 |
FHLB advances | 850,000 |  | — |  | — |  |  | — |  |  | 850,000 |
Other borrowings | 123,935 |  | (40,000) |  | — |  |  | 40,000 |  | (e) | 123,935 |
Subordinated debt | 181,324 |  | — |  | — |  |  | — |  |  | 181,324 |
FRB PPP liquidity facility | 4,811,009 |  | — |  | — |  |  | — |  |  | 4,811,009 |
Accrued interest payable and other liabilities | 241,891 |  | (15,964) |  | 26,554 |  | (c), (g) | (3,584) |  | (e), (i), (j) | 248,897 |
Total liabilities | 17,727,236 |  | (55,964) |  | 26,554 |  |  | 53,192 |  |  | 17,751,018 |
Shareholders' equity: |  |  |  |  |  |  |
Preferred stock | 217,471 |  | — |  | — |  |  | — |  |  | 217,471 |
Common stock | 32,836 |  | — |  | — |  |  | — |  |  | 32,836 |
Additional paid in capital | 452,965 |  | (50,734) |  | 33,125 |  | (c), (h) | 11,489 |  | (i), (j) | 446,845 |
Retained earnings | 385,750 |  | 26,164 |  | (26,986) |  | (g), (h) | (15,792) |  | (i), (j) | 369,136 |
Accumulated other comprehensive loss, net | (15,751) |  | — |  | — |  |  | — |  |  | (15,751) |
Treasury stock | (21,780) |  | — |  | — |  |  | — |  |  | (21,780) |
Noncontrolling interests | — |  | — |  | (9,567) |  | (c), (h) | 9,567 |  | (i) | — |
Total shareholders’ equity | 1,051,491 |  | (24,570) |  | 6,139 |  |  | (4,303) |  |  | 1,028,757 |
Total liabilities and shareholders’ equity | $ | 18,778,727 |  | $ | (80,534) |  | $ | 32,693 |  |  | $ | 48,889 |  |  | $ | 18,779,775 |

See accompanying notes to the Unaudited Pro Forma Condensed Consolidated Financial Statements.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME
Nine Months Ended September 30, 2020
(amounts in thousands, except share and per share data)

| Historical Customers Bancorp (a) | BankMobile Divestiture (b) | Transaction Accounting Adjustments | Notes | Other Transaction Accounting Adjustments | Notes | Pro Forma Customers Bancorp |
Interest income: |  |  |  |  |  |  |  |
Loans and leases | $ | 366,634 |  | $ | — |  | $ | — |  |  | $ | 894 |  | (k) | $ | 367,528 |  |
Investment securities | 17,429 |  | — |  | — |  |  | — |  |  | 17,429 |  |
Other | 6,149 |  | — |  | — |  |  | — |  |  | 6,149 |  |
Total interest income | 390,212 |  | — |  | — |  |  | 894 |  |  | 391,106 |  |
Interest expense: |  |  |  |  |  |  |  |
Deposits | 75,939 |  | — |  | — |  |  | — |  |  | 75,939 |  |
FHLB advances | 15,889 |  | — |  | — |  |  | — |  |  | 15,889 |  |
Subordinated debt | 8,066 |  | — |  | — |  |  | — |  |  | 8,066 |  |
FRB PPP liquidity facility, federal funds purchased and other borrowings | 9,576 |  | (1,146) |  | — |  |  | 1,146 |  | (k) | 9,576 |  |
Total interest expense | 109,470 |  | (1,146) |  | — |  |  | 1,146 |  |  | 109,470 |  |
Net interest income | 280,742 |  | 1,146 |  | — |  |  | (252) |  |  | 281,636 |  |
Provision for credit losses on loan and lease losses | 65,688 |  | — |  | — |  |  | — |  |  | 65,688 |  |
Net interest income after provision for credit losses on loan and lease losses | 215,054 |  | 1,146 |  | — |  |  | (252) |  |  | 215,948 |  |
Non-interest income: |  |  |  |  |  |  |  |
Interchange and card revenue | 17,368 |  | (20,053) |  | — |  |  | 3,240 |  | (l) | 555 |  |
Deposit fees | 10,221 |  | (8,517) |  | — |  |  | — |  |  | 1,704 |  |
Commercial lease income | 13,286 |  | — |  | — |  |  | — |  |  | 13,286 |  |
Bank-owned life insurance | 5,265 |  | — |  | — |  |  | — |  |  | 5,265 |  |
Mortgage warehouse transactional fees | 7,854 |  | — |  | — |  |  | — |  |  | 7,854 |  |
Gain (loss) on sale of SBA and other loans | 320 |  | — |  | — |  |  | — |  |  | 320 |  |
Mortgage banking income | 1,347 |  | — |  | — |  |  | — |  |  | 1,347 |  |
Loss upon acquisition of interest-only GNMA securities | — |  | — |  | — |  |  | — |  |  | — |  |
Gain (loss) on sale of investment securities | 20,035 |  | — |  | — |  |  | — |  |  | 20,035 |  |
Unrealized gain (loss) on investment securities | 60 |  | — |  | — |  |  | — |  |  | 60 |  |
Other | 2,203 |  | (20,123) |  | — |  |  | 15,228 |  | (m) | (2,692) |  |
Total non-interest income | 77,959 |  | (48,693) |  | — |  |  | 18,468 |  |  | 47,734 |  |
Non-interest expense: |  |  |  |  |  |  |  |
Salaries and employee benefits | 92,283 |  | (23,815) |  | — |  |  | — |  |  | 68,468 |  |
Technology, communication and bank operations | 39,576 |  | (23,395) |  | — |  |  | 18,468 |  | (l), (m) | 34,649 |  |
Professional services | 19,476 |  | (8,536) |  | — |  |  | — |  |  | 10,940 |  |
Occupancy | 9,689 |  | (1,069) |  | — |  |  | — |  |  | 8,620 |  |
Commercial lease depreciation | 10,733 |  | — |  | — |  |  | — |  |  | 10,733 |  |
FDIC assessments, non-income taxes, and regulatory fees | 9,019 |  | — |  | — |  |  | — |  |  | 9,019 |  |
Provision for operating losses | 3,166 |  | (3,071) |  | — |  |  | — |  |  | 95 |  |
Advertising and promotion | 2,221 |  | (693) |  | — |  |  | — |  |  | 1,528 |  |
Merger and acquisition related expenses | 1,110 |  | (452) |  | — |  |  | — |  |  | 658 |  |
Loan workout | 3,020 |  | — |  | — |  |  | — |  |  | 3,020 |  |
Other real estate owned | 26 |  | — |  | — |  |  | — |  |  | 26 |  |
Other | 5,206 |  | 3,226 |  | — |  |  | — |  |  | 8,432 |  |
Total non-interest expense | 195,525 |  | (57,805) |  | — |  |  | 18,468 |  |  | 156,188 |  |
Income (loss) before income tax expense | 97,488 |  | 10,258 |  | — |  |  | (252) |  |  | 107,494 |  |
Income tax expense (benefit) | 21,156 |  | 2,114 |  | — |  |  | (63) |  | (k) | 23,207 |  |
Net income (loss) from continuing operations | 76,332 |  | 8,144 |  | — |  |  | (189) |  |  | 84,287 |  |
Preferred stock dividends | 10,626 |  | — |  | — |  |  | — |  |  | 10,626 |  |
Net income (loss) from continuing operations available to common shareholders | $ | 65,706 |  | $ | 8,144 |  | $ | — |  |  | $ | (189) |  |  | $ | 73,661 |  |
Basic earnings per common share - continuing operations | $ | 2.09 |  |  |  |  |  |  | $ | 2.34 |  |
Diluted earnings per common share - continuing operations | $ | 2.07 |  |  |  |  |  |  | $ | 2.33 |  |
Weighted-average number of common shares - basic | 31,462,284 |  |  |  |  |  |  | 31,462,284 |  |
Weighted-average number of common shares - diluted | 31,666,027 |  |  |  |  |  |  | 31,666,027 |  |

See accompanying notes to the Unaudited Pro Forma Condensed Consolidated Financial Statements.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS)
Nine Months Ended September 30, 2020
(amounts in thousands, except share and per share data)

| Historical Customers Bancorp (a) | BankMobile Divestiture (b) | Transaction Accounting Adjustments | Notes | Other Transaction Accounting Adjustments | Notes | Pro Forma Customers Bancorp |
Net income (loss) from continuing operations: | $ | 76,332 |  | $ | 8,144 |  | $ | — |  |  | $ | (189) |  |  | $ | 84,287 |  |
Unrealized gains (losses) on available for sale debt securities: |  |  |  |  |  |  |  |
Unrealized gains (losses) arising during the period | 25,127 |  | — |  | — |  |  | — |  |  | 25,127 |  |
Income tax effect | (6,533) |  | — |  | — |  |  | — |  |  | (6,533) |  |
Reclassification adjustments for (gains) losses included in net income | (20,035) |  | — |  | — |  |  | — |  |  | (20,035) |  |
Income tax effect | 5,209 |  | — |  | — |  |  | — |  |  | 5,209 |  |
Net unrealized gains (losses) on available for sale debt securities | 3,768 |  | — |  | — |  |  | — |  |  | 3,768 |  |
Unrealized gains (losses) on cash flow hedges: |  |  |  |  | — |  |  |  |
Unrealized gains (losses) arising during the period | (33,486) |  | — |  | — |  |  | — |  |  | (33,486) |  |
Income tax effect | 8,884 |  | — |  | — |  |  | — |  |  | 8,884 |  |
Reclassification adjustments for (gains) losses included in net income | 8,596 |  | — |  | — |  |  | — |  |  | 8,596 |  |
Income tax effect | (2,263) |  | — |  | — |  |  | — |  |  | (2,263) |  |
Net unrealized gains (losses) on cash flow hedges | (18,269) |  | — |  | — |  |  | — |  |  | (18,269) |  |
Other comprehensive income (loss), net of income tax effect | (14,501) |  | — |  | — |  |  | — |  |  | (14,501) |  |
Comprehensive income (loss) | $ | 61,831 |  | $ | 8,144 |  | $ | — |  |  | $ | — |  |  | $ | 69,975 |  |

See accompanying notes to the Unaudited Pro Forma Condensed Consolidated Financial Statements.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME
For the Year Ended December 31, 2019
(amounts in thousands, except share and per share data)

| Historical Customers Bancorp (a) | BankMobile Divestiture (b) | Transaction Accounting Adjustments | Notes | Other Transaction Accounting Adjustments | Notes | Pro Forma Customers Bancorp |
Interest income: |  |  |  |  |  |  |  |
Loans and leases | $ | 431,491 |  | $ | — |  | $ | — |  |  | $ | 417 |  | (k) | $ | 431,908 |  |
Investment securities | 23,713 |  | — |  | — |  |  | — |  |  | 23,713 |  |
Other | 8,535 |  | — |  | — |  |  | — |  |  | 8,535 |  |
Total interest income | 463,739 |  | — |  | — |  |  | 417 |  |  | 464,156 |  |
Interest expense: |  |  |  |  |  |  |  |
Deposits | 141,464 |  | — |  | — |  |  | — |  |  | 141,464 |  |
FHLB advances | 26,519 |  | — |  | — |  |  | — |  |  | 26,519 |  |
Subordinated debt | 6,983 |  | — |  | — |  |  | — |  |  | 6,983 |  |
FRB PPP liquidity facility, federal funds purchased and other borrowings | 11,463 |  | (535) |  | — |  |  | 535 | (k) | 11,463 |  |
Total interest expense | 186,429 |  | (535) |  | — |  |  | 535 |  |  | 186,429 |  |
Net interest income | 277,310 |  | 535 |  | — |  |  | (118) |  |  | 277,727 |  |
Provision for credit losses on loans and leases | 24,227 |  | — |  | — |  |  | — |  |  | 24,227 |  |
Net interest income after provision for credit losses on loans and leases | 253,083 |  | 535 |  | — |  |  | (118) |  |  | 253,500 |  |
Non-interest income: |  |  |  |  |  |  |  |
Interchange and card revenue | 28,941 |  | (28,160) |  | — |  |  | — |  |  | 781 |  |
Deposit fees | 12,815 |  | (11,073) |  | — |  |  | — |  |  | 1,742 |  |
Commercial lease income | 12,051 |  | — |  | — |  |  | — |  |  | 12,051 |  |
Bank-owned life insurance | 7,272 |  | — |  | — |  |  | — |  |  | 7,272 |  |
Mortgage warehouse transactional fees | 7,128 |  | — |  | — |  |  | — |  |  | 7,128 |  |
Gain (loss) on sale of SBA and other loans | 2,770 |  | — |  | — |  |  | — |  |  | 2,770 |  |
Mortgage banking income | 66 |  | — |  | — |  |  | — |  |  | 66 |  |
Loss upon acquisition of interest-only GNMA securities | (7,476) |  | — |  | — |  |  | — |  |  | (7,476) |  |
Gain (loss) on sale of investment securities | 1,001 |  | — |  | — |  |  | — |  |  | 1,001 |  |
Unrealized gain (loss) on investment securities | 1,299 |  | — |  | — |  |  | — |  |  | 1,299 |  |
Other | 15,071 |  | (33,846) |  | — |  |  | 27,425 |  | (m) | 8,650 |  |
Total non-interest income | 80,938 |  | (73,079) |  | — |  |  | 27,425 |  |  | 35,284 |  |
Non-interest expense: |  |  |  |  |  |  |  |
Salaries and employee benefits | 107,632 |  | (27,510) |  | — |  |  | 21,056 |  | (i), (j) | 101,178 |  |
Technology, communication and bank operations | 43,481 |  | (25,843) |  | — |  |  | 27,425 |  | (m) | 45,063 |  |
Professional services | 25,109 |  | (13,669) |  | — |  |  | — |  |  | 11,440 |  |
Occupancy | 13,098 |  | (1,791) |  | — |  |  | — |  |  | 11,307 |  |
Commercial lease depreciation | 9,473 |  | — |  | — |  |  | — |  |  | 9,473 |  |
FDIC assessments, non-income taxes, and regulatory fees | 5,861 |  | (54) |  | — |  |  | — |  |  | 5,807 |  |
Provision for operating losses | 9,638 |  | (9,367) |  | — |  |  | — |  |  | 271 |  |
Advertising and promotion | 4,044 |  | (1,354) |  | — |  |  | — |  |  | 2,690 |  |
Merger and acquisition related expenses | 100 |  | (100) |  | — |  |  | — |  |  | — |  |
Loan workout | 1,687 |  | — |  | — |  |  | — |  |  | 1,687 |  |
Other real estate owned | 398 |  | — |  | — |  |  | — |  |  | 398 |  |
Other | 11,380 |  | 1,487 |  | — |  |  | — |  |  | 12,867 |  |
Total non-interest expense | 231,901 |  | (78,201) |  | — |  |  | 48,481 |  |  | 202,181 |  |
Income (loss) before income tax expense | 102,120 |  | 5,657 |  | — |  |  | (21,174) |  |  | 86,603 |  |
Income tax expense (benefit) | 22,793 |  | 1,276 |  | 23,702 |  | (g) | (5,293) |  | (i), (j), (k) | 42,478 |  |
Net income (loss) from continuing operations | 79,327 |  | 4,381 |  | (23,702) |  |  | (15,881) |  |  | 44,125 |  |
Preferred stock dividends | 14,459 |  | — |  | — |  |  | — |  |  | 14,459 |  |
Net income (loss) from continuing operations available to common shareholders | $ | 64,868 |  | $ | 4,381 |  | $ | (23,702) |  |  | $ | (15,881) |  |  | $ | 29,666 |  |
Basic earnings per common share - continuing operations | $ | 2.08 |  |  |  |  |  |  | $ | 0.95 |  |
Diluted earnings per common share - continuing operations | $ | 2.05 |  |  |  |  |  |  | $ | 0.94 |  |
Weighted-average number of common shares - basic | 31,183,841 |  |  |  |  |  |  | 31,183,841 |  |
Weighted-average number of common shares - diluted | 31,646,216 |  |  |  |  |  |  | 31,646,216 |  |

See accompanying notes to the Unaudited Pro Forma Condensed Consolidated Financial Statements.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS)
For the Year Ended December 31, 2019
(amounts in thousands, except share and per share data)

| Historical Customers Bancorp (a) | BankMobile Divestiture (b) | Transaction Accounting Adjustments | Notes | Other Transaction Accounting Adjustments | Notes | Pro Forma Customers Bancorp |
Net income (loss) from continuing operations: | $ | 79,327 |  | $ | 4,381 |  | $ | (23,702) |  |  | $ | (15,881) |  |  | $ | 44,125 |  |
Unrealized gains (losses) on available for sale debt securities: |  |  |  |  |  |  |  |
Unrealized gains (losses) arising during the period | 49,688 |  | — |  | — |  |  | — |  |  | 49,688 |  |
Income tax effect | (12,919) |  | — |  | — |  |  | — |  |  | (12,919) |  |
Reclassification adjustments for (gains) losses included in net income | (1,001) |  | — |  | — |  |  | — |  |  | (1,001) |  |
Income tax effect | 260 |  | — |  | — |  |  | — |  |  | 260 |  |
Net unrealized gains (losses) on available for sale debt securities | 36,028 |  | — |  | — |  |  | — |  |  | 36,028 |  |
Unrealized gains (losses) on cash flow hedges: |  |  |  |  |  |  |  |
Unrealized gains (losses) arising during the period | (21,157) |  | — |  | — |  |  | — |  |  | (21,157) |  |
Income tax effect | 5,501 |  | — |  | — |  |  | — |  |  | 5,501 |  |
Reclassification adjustments for (gains) losses included in net income | 1,407 |  | — |  | — |  |  | — |  |  | 1,407 |  |
Income tax effect | (366) |  | — |  | — |  |  | — |  |  | (366) |  |
Net realized gains (losses) on cash flow hedges | (14,615) |  | — |  | — |  |  | — |  |  | (14,615) |  |
Other comprehensive income (loss), net of income tax effect | 21,413 |  | — |  | — |  |  | — |  |  | 21,413 |  |
Comprehensive income (loss) | $ | 100,740 |  | $ | 4,381 |  | $ | (23,702) |  |  | $ | (15,881) |  |  | $ | 65,538 |  |

See accompanying notes to the Unaudited Pro Forma Condensed Consolidated Financial Statements.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME
For the Year Ended December 31, 2018
(amounts in thousands, except share and per share data)

| Historical Customers Bancorp (a) | BankMobile Divestiture (b) | Transaction Accounting Adjustments | Notes | Other Transaction Accounting Adjustments | Notes | Pro Forma Customers Bancorp |
Interest income: |  |  |  |  |  |  |  |
Loans and leases | $ | 373,234 |  | $ | — |  | $ | — |  |  | $ | — |  |  | $ | 373,234 |  |
Investment securities | 33,209 |  | — |  | — |  |  | — |  |  | 33,209 |  |
Other | 11,508 |  | — |  | — |  |  | — |  |  | 11,508 |  |
Total interest income | 417,951 |  | — |  | — |  |  | — |  |  | 417,951 |  |
Interest expense: |  |  |  |  |  |  |  |
Deposits | 110,808 |  | — |  | — |  |  | — |  |  | 110,808 |  |
FHLB advances | 31,043 |  | — |  | — |  |  | — |  |  | 31,043 |  |
Subordinated debt | 6,737 |  | — |  | — |  |  | — |  |  | 6,737 |  |
FRB PPP liquidity facility, federal funds purchased and other borrowings | 11,486 |  | — |  | — |  |  | — |  |  | 11,486 |  |
Total interest expense | 160,074 |  | — |  | — |  |  | — |  |  | 160,074 |  |
Net interest income | 257,877 |  | — |  | — |  |  | — |  |  | 257,877 |  |
Provision for credit losses on loans and leases | 5,642 |  | — |  | — |  |  | — |  |  | 5,642 |  |
Net interest income after provision for credit losses on loans and leases | 252,235 |  | — |  | — |  |  | — |  |  | 252,235 |  |
Non-interest income: |  |  |  |  |  |  |  |
Interchange and card revenue | 30,695 |  | (29,923) |  | — |  |  | — |  |  | 772 |  |
Deposit fees | 7,824 |  | (6,544) |  | — |  |  | — |  |  | 1,280 |  |
Commercial lease income | 5,354 |  | — |  | — |  |  | — |  |  | 5,354 |  |
Bank-owned life insurance | 7,620 |  | — |  | — |  |  | — |  |  | 7,620 |  |
Mortgage warehouse transactional fees | 7,158 |  | — |  | — |  |  | — |  |  | 7,158 |  |
Gain (loss) on sale of SBA and other loans | 3,294 |  | — |  | — |  |  | — |  |  | 3,294 |  |
Mortgage banking income | 606 |  | — |  | — |  |  | — |  |  | 606 |  |
Loss upon acquisition of interest-only GNMA securities | — |  | — |  | — |  |  | — |  |  | — |  |
Gain (loss) on sale of investment securities | (18,659) |  | — |  | — |  |  | — |  |  | (18,659) |  |
Unrealized gain (loss) on investment securities | (1,634) |  | — |  | — |  |  | — |  |  | (1,634) |  |
Other | 16,740 |  | (21,181) |  | — |  |  | 16,140 |  | (m) | 11,699 |  |
Total non-interest income | 58,998 |  | (57,648) |  | — |  |  | 16,140 |  |  | 17,490 |  |
Non-interest expense: |  |  |  |  |  |  |  |
Salaries and employee benefits | 104,841 |  | (22,473) |  | — |  |  | — |  |  | 82,368 |  |
Technology, communication and bank operations | 44,454 |  | (30,281) |  | — |  |  | 16,140 |  | (m) | 30,313 |  |
Professional services | 20,237 |  | (8,640) |  | — |  |  | — |  |  | 11,597 |  |
Occupancy | 11,809 |  | (1,656) |  | — |  |  | — |  |  | 10,153 |  |
Commercial lease depreciation | 4,388 |  | — |  | — |  |  | — |  |  | 4,388 |  |
FDIC assessments, non-income taxes, and regulatory fees | 8,642 |  | (16) |  | — |  |  | — |  |  | 8,626 |  |
Provision for operating losses | 5,616 |  | (5,417) |  | — |  |  | — |  |  | 199 |  |
Advertising and promotion | 2,446 |  | (557) |  | — |  |  | — |  |  | 1,889 |  |
Merger and acquisition related expenses | 4,391 |  | (4,090) |  | — |  |  | — |  |  | 301 |  |
Loan workout | 2,183 |  | — |  | — |  |  | — |  |  | 2,183 |  |
Other real estate owned | 449 |  | — |  | — |  |  | — |  |  | 449 |  |
Other | 10,723 |  | 907 |  | — |  |  | — |  |  | 11,630 |  |
Total non-interest expense | 220,179 |  | (72,223) |  | — |  |  | 16,140 |  |  | 164,096 |  |
Income (loss) before income tax expense | 91,054 |  | 14,575 |  | — |  |  | — |  |  | 105,629 |  |
Income tax expense (benefit) | 19,359 |  | 3,988 |  | — |  |  | — |  |  | 23,347 |  |
Net income (loss) from continuing operations | 71,695 |  | 10,587 |  | — |  |  | — |  |  | 82,282 |  |
Preferred stock dividends | 14,459 |  | — |  | — |  |  | — |  |  | 14,459 |  |
Net income (loss) from continuing operations available to common shareholders | $ | 57,236 |  | $ | 10,587 |  | $ | — |  |  | $ | — |  |  | $ | 67,823 |  |
Basic earnings per common share - continuing operations | $ | 1.81 |  |  |  |  |  |  | $ | 2.15 |  |
Diluted earnings per common share - continuing operations | $ | 1.78 |  |  |  |  |  |  | $ | 2.10 |  |
Weighted-average number of common shares - basic | 31,570,118 |  |  |  |  |  |  | 31,570,118 |  |
Weighted-average number of common shares - diluted | 32,233,098 |  |  |  |  |  |  | 32,233,098 |  |

See accompanying notes to the Unaudited Pro Forma Condensed Consolidated Financial Statements.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS)
For the Year Ended December 31, 2018
(amounts in thousands, except share and per share data)

| Historical Customers Bancorp (a) | BankMobile Divestiture (b) | Transaction Accounting Adjustments | Notes | Other Transaction Accounting Adjustments | Notes | Pro Forma Customers Bancorp |
Net income (loss) from continuing operations: | $ | 71,695 |  | $ | 10,587 |  | $ | — |  |  | $ | — |  |  | $ | 82,282 |  |
Unrealized gains (losses) on available for sale debt securities: |  |  |  |  |  |  |  |
Unrealized holding gains (losses) arising during the period | (46,069) |  | — |  | — |  |  | — |  |  | (46,069) |  |
Income tax effect | 11,978 |  | — |  | — |  |  | — |  |  | 11,978 |  |
Reclassification adjustments for (gains) losses included in net income | 18,659 |  | — |  | — |  |  | — |  |  | 18,659 |  |
Income tax effect | (4,851) |  | — |  | — |  |  | — |  |  | (4,851) |  |
Net unrealized gains (losses) on available for sale debt securities | (20,283) |  | — |  | — |  |  | — |  |  | (20,283) |  |
Unrealized gains (losses) on cash flow hedges: |  |  |  |  |  |  |  |
Unrealized gains (losses) arising during the period | 1,995 |  | — |  | — |  |  | — |  |  | 1,995 |  |
Income tax effect | (518) |  | — |  | — |  |  | — |  |  | (518) |  |
Reclassification adjustments for (gains) losses included in net income | (2,917) |  | — |  | — |  |  | — |  |  | (2,917) |  |
Income tax effect | 758 |  | — |  | — |  |  | — |  |  | 758 |  |
Net realized gains (losses) on cash flow hedges | (682) |  | — |  | — |  |  | — |  |  | (682) |  |
Other comprehensive income (loss), net of income tax effect | (20,965) |  | — |  | — |  |  | — |  |  | (20,965) |  |
Comprehensive income (loss) | $ | 50,730 |  | $ | 10,587 |  | $ | — |  |  | $ | — |  |  | $ | 61,317 |  |

See accompanying notes to the Unaudited Pro Forma Condensed Consolidated Financial Statements.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF INCOME
For the Year Ended December 31, 2017
(amounts in thousands, except share and per share data)

| Historical Customers Bancorp (a) | BankMobile Divestiture (b) | Transaction Accounting Adjustments | Notes | Other Transaction Accounting Adjustments | Notes | Pro Forma Customers Bancorp |
Interest income: |  |  |  |  |  |  |  |
Loans and leases | $ | 339,936 |  | $ | — |  | $ | — |  |  | $ | — |  |  | $ | 339,936 |  |
Investment securities | 25,153 |  | — |  | — |  |  | — |  |  | 25,153 |  |
Other | 7,761 |  | — |  | — |  |  | — |  |  | 7,761 |  |
Total interest income | 372,850 |  | — |  | — |  |  | — |  |  | 372,850 |  |
Interest expense: |  |  |  |  |  |  |  |
Deposits | 67,582 |  | — |  | — |  |  | — |  |  | 67,582 |  |
FHLB advances | 21,130 |  | — |  | — |  |  | — |  |  | 21,130 |  |
Subordinated debt | 6,739 |  | — |  | — |  |  | — |  |  | 6,739 |  |
FRB PPP liquidity facility, federal funds purchased and other borrowings | 10,056 |  | — |  | — |  |  |  |  | 10,056 |  |
Total interest expense | 105,507 |  | — |  | — |  |  | — |  |  | 105,507 |  |
Net interest income | 267,343 |  | — |  | — |  |  | — |  |  | 267,343 |  |
Provision for credit losses on loans and leases | 6,768 |  | — |  | — |  |  | — |  |  | 6,768 |  |
Net interest income after provision for credit losses on loans and leases | 260,575 |  | — |  | — |  |  | — |  |  | 260,575 |  |
Non-interest income: |  |  |  |  |  |  |  |
Interchange and card revenue | 41,509 |  | (9,559) |  | — |  |  | — |  |  | 31,950 |  |
Deposit fees | 10,039 |  | (1,827) |  | — |  |  | — |  |  | 8,212 |  |
Commercial lease income | 647 |  | — |  | — |  |  | — |  |  | 647 |  |
Bank-owned life insurance | 7,219 |  | — |  | — |  |  | — |  |  | 7,219 |  |
Mortgage warehouse transactional fees | 9,345 |  | — |  | — |  |  | — |  |  | 9,345 |  |
Gain (loss) on sale of SBA and other loans | 4,223 |  | — |  | — |  |  | — |  |  | 4,223 |  |
Mortgage banking income | 875 |  | — |  | — |  |  | — |  |  | 875 |  |
Loss upon acquisition of interest-only GNMA securities | — |  | — |  | — |  |  | — |  |  | — |  |
Impairment loss on investment securities | (12,934) |  | — |  | — |  |  | — |  |  | (12,934) |  |
Gain (loss) on sale of investment securities | 8,800 |  | — |  | — |  |  | — |  |  | 8,800 |  |
Unrealized gain (loss) on investment securities | — |  | — |  | — |  |  | — |  |  | — |  |
Other | 9,187 |  | (1,155) |  | — |  |  | — |  |  | 8,032 |  |
Total non-interest income | 78,910 |  | (12,541) |  | — |  |  | — |  |  | 66,369 |  |
Non-interest expense: |  |  |  |  |  |  |  |
Salaries and employee benefits | 95,518 |  | (942) |  | — |  |  | — |  |  | 94,576 |  |
Technology, communication and bank operations | 45,885 |  | (10,391) |  | — |  |  | — |  |  | 35,494 |  |
Professional services | 28,051 |  | (4,411) |  | — |  |  | — |  |  | 23,640 |  |
Occupancy | 11,161 |  | (599) |  | — |  |  | — |  |  | 10,562 |  |
Commercial lease depreciation | 522 |  | — |  | — |  |  | — |  |  | 522 |  |
FDIC assessments, non-income taxes, and regulatory fees | 7,906 |  | — |  | — |  |  | — |  |  | 7,906 |  |
Provision for operating losses | 6,435 |  | (1,410) |  | — |  |  | — |  |  | 5,025 |  |
Advertising and promotion | 1,470 |  | (195) |  | — |  |  | — |  |  | 1,275 |  |
Merger and acquisition related expenses | 410 |  | (410) |  | — |  |  | — |  |  | — |  |
Loan workout | 2,366 |  | — |  | — |  |  | — |  |  | 2,366 |  |
Other real estate owned | 570 |  | — |  | — |  |  | — |  |  | 570 |  |
Other | 15,312 |  | 758 |  | — |  |  | — |  |  | 16,070 |  |
Total non-interest expense | 215,606 |  | (17,600) |  | — |  |  | — |  |  | 198,006 |  |
Income (loss) before income tax expense | 123,879 |  | 5,059 |  | — |  |  | — |  |  | 128,938 |  |
Income tax expense (benefit) | 45,042 |  | 2,010 |  | — |  |  | — |  |  | 47,052 |  |
Net income (loss) from continuing operations | 78,837 |  | 3,049 |  | — |  |  | — |  |  | 81,886 |  |
Preferred stock dividends | 14,459 |  | — |  | — |  |  | — |  |  | 14,459 |  |
Net income (loss) from continuing operations available to common shareholders | $ | 64,378 |  | $ | 3,049 |  | $ | — |  |  | $ | — |  |  | $ | 67,427 |  |
Basic earnings per common share - continuing operations | $ | 2.10 |  |  |  |  |  |  | $ | 2.20 |  |
Diluted earnings per common share - continuing operations | $ | 1.97 |  |  |  |  |  |  | $ | 2.07 |  |
Weighted-average number of common shares - basic | 30,659,320 |  |  |  |  |  |  | 30,659,320 |  |
Weighted-average number of common shares - diluted | 32,596,677 |  |  |  |  |  |  | 32,596,677 |  |

See accompanying notes to the Unaudited Pro Forma Condensed Consolidated Financial Statements
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (LOSS)
For the Year Ended December 31, 2017
(amounts in thousands, except share and per share data)

| Historical Customers Bancorp (a) | BankMobile Divestiture (b) | Transaction Accounting Adjustments | Notes | Other Transaction Accounting Adjustments | Notes | Pro Forma Customers Bancorp |
Net income (loss) from continuing operations: | $ | 78,837 |  | $ | 3,049 |  | $ | — |  |  | $ | — |  |  | $ | 81,886 |  |
Unrealized gains (losses) on available for sale securities: |  |  |  |  |  |  |  |
Unrealized gains (losses) arising during the period | 12,266 |  | — |  | — |  |  | — |  |  | 12,266 |  |
Income tax effect | (4,378) |  | — |  | — |  |  | — |  |  | (4,378) |  |
Reclassification adjustments for (gains) losses included in net income | (8,800) |  | — |  | — |  |  | — |  |  | (8,800) |  |
Income tax effect | 3,432 |  | — |  | — |  |  | — |  |  | 3,432 |  |
Net unrealized gains (losses) on available for sale debt securities | 2,520 |  | — |  | — |  |  | — |  |  | 2,520 |  |
Unrealized gains (losses) on cash flow hedges: |  |  |  |  |  |  |  |
Unrealized gains (losses) arising during the period | 666 |  | — |  | — |  |  | — |  |  | 666 |  |
Income tax effect | (260) |  | — |  | — |  |  | — |  |  | (260) |  |
Reclassification adjustments for (gains) losses included in net income | 2,634 |  | — |  | — |  |  | — |  |  | 2,634 |  |
Income tax effect | (1,027) |  | — |  | — |  |  | — |  |  | (1,027) |  |
Net realized gains (losses) on cash flow hedges | 2,013 |  | — |  | — |  |  | — |  |  | 2,013 |  |
Other comprehensive income (loss), net of income tax effect | 4,533 |  | — |  | — |  |  | — |  |  | 4,533 |  |
Comprehensive income (loss) | $ | 83,370 |  | $ | 3,049 |  | $ | — |  |  | $ | — |  |  | $ | 86,419 |  |

See accompanying notes to the Unaudited Pro Forma Condensed Consolidated Financial Statements.
NOTES TO THE UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - NON-RECURRING EXPENSES
Customers Bancorp incurred merger and acquisition related expenses of approximately $658 thousand in the nine months ended September 30, 2020 and $377 thousand upon closing of the Divestiture, which will not recur in Customers Bancorp's statement of income beyond 12 months after the Divestiture.
NOTE 2 - TRANSACTION ACCOUNTING ADJUSTMENTS AND ADJUSTMENTS FOR OTHER TRANSACTIONS TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Upon closing of the Divestiture, Customers received cash consideration of $23.1 million and holders of Customers common stock who held their Customers shares as of the close of business on December 18, 2020 became entitled to receive an aggregate of 4,876,387 shares of BMT's common stock. Each holder of Customers common stock is entitled to receive 0.15389 shares of BMT common stock for each share of Customers common stock held as of the close of business on December 18, 2020. No fractional shares of BMT common stock were issued; fractional share otherwise issuable were rounded to the nearest whole share. Certain employees of BankMobile also received 1,348,748 shares of BMT's common stock as severance. The total stock consideration from the Merger that were distributed to holders of Customers common stock and certain BankMobile employees represented 52% of the outstanding common stock of BMT at the closing date of the Divestiture.
The following summarizes the total consideration received:

Total Consideration (in thousands, except shares) | Amounts | Shares
Share consideration at $14.87 per share at closing | $ | 92,568 |  | 6,225,135 |
Cash consideration | 23,125 |  | — |
Total consideration | $ | 115,693 |  |

The following notes accompany the unaudited pro forma condensed consolidated financial statements:
(a)As presented in Customers Bancorp's quarterly report on Form 10-Q for the nine months ended September 30, 2020 filed with the SEC on November 3, 2020, and the annual reports on Form 10-K for the year ended December 31, 2019 filed with the SEC on March 2, 2020, the year ended December 31, 2018 filed with the SEC on March 1, 2019, and the year ended December 31, 2017 filed with the SEC on February 23, 2018, respectively.
(b)As included in Customers Bancorp's quarterly report on Form 10-Q for the nine months ended September 30, 2020 filed with the SEC on November 3, 2020, and the annual reports on Form 10-K for the year ended December 31, 2019 filed with the SEC on March 2, 2020, the year ended December 31, 2018 filed with the SEC on March 1, 2019, and the year ended December 31, 2017 filed with the SEC on February 23, 2018, respectively.
(c)Represents cash consideration received by Customers Bancorp upon closing of the Divestiture of $23.1 million for the sale of ownership interests in BankMobile.
(d)Represents BankMobile' interest-bearing cash of $16.8 million held in deposit at Customers Bank.
(e)Represents BankMobile's borrowing of $40.0 million from Customers Bank, and related accrued interest of $1.7 million.
(f)Represents $8.8 million of cash from the Divestiture applied towards partial repayment of BankMobile's borrowing from Customers Bank. Subsequent to September 30, 2020, the $40 million borrowing from Customers Bank was paid down to $21 million. At the date of closing, BMT assumed BankMobile's outstanding borrowing from Customers Bank of $12.2 million.
(g)Represents estimated income taxes payable of $26.6 million on the sale of Customers Bancorp's ownership interests in BankMobile and subsequent distribution of BMT common stock received as consideration, based on the applicable blended statutory income tax rates in effect for the periods presented.
(h)Represents the sale of ownership interests in BankMobile and distribution of BMT common stock received as consideration to holders of Customers Bancorp's common stock in the form of special dividends.

(i)Represents Customers Bancorp's distribution of BMT common stock received as consideration to certain BankMobile employees as severance of $20 million, and related income tax effect of $5.0 million.
(j)Represents immediate vesting of Customers Bancorp's stock options to certain BankMobile employees of $1.0 million upon closing of the Divestiture, and related income tax effect of $0.3 million.
(k)Represents interest expense incurred by BankMobile on its borrowings of $40 million from Customers Bank drawn in August 2019, and earned by Customers Bank during the periods presented. Interest income earned by Customers Bank has been adjusted, net of income tax effect, for the effect of balance sheet adjustment for other transaction described in (f) above as if it had occurred as of January 1, 2019. BMT has assumed BankMobile's outstanding borrowing from Customers Bank of $12.2 million.
(l)Represents fees paid by Customers Bank to BankMobile for the difference between the regulated interchange fees for financial institutions, including Customers Bank, with more than $10 billion in assets under 12 CFR Part 235 ("Durbin Amendment") and the unregulated interchange fees for financial institutions exempt from the Durbin Amendment beginning July 1, 2020. Customers Bank will continue to incur these fees to BMT after the Divestiture pursuant to the Deposit Processing Services Agreement.
(m)Represents deposit servicing fees paid by Customers Bank to BankMobile for the servicing and delivery of personal deposit and loan accounts through BankMobile's technology and banking compliant infrastructure during the periods presented. Customers Bank will continue to incur these fees to BMT after the Divestiture pursuant to the Deposit Processing Services Agreement.