Amerant Bancorp Inc.

AMTB

US0235761014

Banks

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Apr. 25	Transcript : Amerant Bancorp Inc., Q1 2024 Earnings Call, Apr 25, 2024
Apr. 24	Earnings Flash (AMTB) AMERANT BANCORP Posts Q1 EPS $0.32, vs. Street Est of $0.38	MT

AMERANT BANCORP INC. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (form 10-K)

March 01, 2023 at 04:50 pm EST

The following discussion and analysis of our financial condition and results of
operations should be read in conjunction with our audited consolidated financial
statements and related notes included elsewhere in this Form 10-K. This
discussion and analysis contains forward-looking statements that involve risks,
uncertainties and assumptions. Certain risks, uncertainties and other factors,
including but not limited to those set forth under "Cautionary Note Regarding
Forward-Looking Statements," "Risk Factors" and elsewhere in this Form 10-K, may
cause actual results to differ materially from those projected in the forward
looking statements.

The emphasis of this discussion will be on changes in the year ended December
31, 2022 with respect to 2021. See our Annual Report on Form 10-K for the year
ended December 31, 2021 for additional details on the Company's financial
condition and results of operations in 2021 and changes in the Company's
financial condition and results of operations from 2020 to 2021.


Overview


Our Company

We are a bank holding company headquartered in Coral Gables, Florida. We provide
individuals and businesses a comprehensive array of deposit, credit, investment,
wealth management, retail banking, mortgage services, and fiduciary services. We
serve customers in our United States markets and select international customers.
These services are offered through the Bank, which is also headquartered in
Coral Gables, Florida, and its subsidiaries. Fiduciary, investment, wealth
management and mortgage lending services are provided by the Bank's securities
broker-dealer, Amerant Investments, the Bank's Grand-Cayman based trust company,
the Cayman Bank, and the mortgage company, Amerant Mortgage. The Bank's primary
markets are South Florida, where we are headquartered and operate sixteen
banking centers in Miami-Dade, Broward and Palm Beach counties, and Houston,
Texas, where we operate seven banking centers that serve the nearby areas of
Harris, Montgomery, Fort Bend and Waller counties. In addition, we have a loan
production office ("LPO") in Tampa, Florida. See "Item1-Business" for recent
developments.

Emerging Growth Company

Prior to December 31, 2022, we were an EGC, as defined in the JOBS Act. As such,
we were eligible to take advantage of certain exemptions from various reporting
requirements that are applicable to other public companies that are not
"emerging growth companies," including, but not limited to, not being required
to comply with the auditor attestation requirements of Section 404 of the
Sarbanes-Oxley Act, or SOX Act, reduced disclosure obligations regarding
executive compensation in our periodic reports and proxy statements, and
exemptions from the requirements of holding a non-binding advisory vote on
executive compensation and shareholder approval of any golden parachute payments
not previously approved. In addition, Section 107 of the JOBS Act also provides
that an EGC can take advantage of the extended transition period provided in
Section 7(a)(2)(B) of the Securities Act of 1933, as amended (the "Securities
Act"), for complying with new or revised accounting standards. In other words,
an EGC can delay the adoption of certain accounting standards until those
standards would otherwise apply to private companies. The Company benefited from
the reporting exemptions and benefits mentioned above since it became a publicly
traded company.

As of December 31, 2022, the Company determined that it was deemed a large
accelerated filer effective as of that date, based on the aggregate worldwide
market value of its voting and non-voting common stock held by the Company's
non-affiliates as of the last business day of the second quarter of 2022.
Consequently, the Company determined that it no longer qualified as an EGC as of
December 31, 2022 and, therefore, was unable to continue to take advantage of
reporting exemptions and other benefits for an EGC under the JOBS Act.

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Primary Factors Used to Evaluate Our Business



Results of Operations. In addition to net income or loss, the primary factors we
use to evaluate and manage our results of operations include net interest
income, noninterest income and expenses, and indicators of financial performance
including return on assets ("ROA") and return on equity ("ROE"). We also use
certain non-GAAP financial measures in the internal evaluation and management of
our businesses.

Net Interest Income. Net interest income represents interest income less
interest expense. We generate interest income from interest, dividends and fees
received on interest-earning assets, including loans and investment securities
we own. We incur interest expense from interest paid on interest-bearing
liabilities, including interest-bearing deposits, and borrowings such as FHLB
advances and other borrowings such as repurchase agreements, notes, debentures
and other funding sources we may have from time to time. Net interest income
typically is the most significant contributor to our revenues and net income. To
evaluate net interest income, we measure and monitor: (i) yields on our loans
and other interest-earning assets; (ii) the costs of our deposits and other
funding sources; (iii) our net interest spread; (iv) our net interest margin, or
NIM; and (v) our provisions for loan losses. Net interest spread is the
difference between rates earned on interest-earning assets and rates paid on
interest-bearing liabilities. NIM is calculated by dividing net interest income
for the period by average interest-earning assets during that same period.
Because noninterest-bearing sources of funds, such as noninterest-bearing
deposits and stockholders' equity, also fund interest-earning assets, NIM
includes the benefit of these noninterest-bearing sources of funds.
Non-refundable loan origination fees, net of direct costs of originating loans,
as well as premiums or discounts paid on loan purchases, are deferred and
recognized over the life of the related loan as an adjustment to interest income
in accordance with generally accepted accounting principles ("GAAP").

Changes in market interest rates and the interest we earn on interest-earning
assets, or which we pay on interest-bearing liabilities, as well as the volumes
and the types of interest-earning assets, interest-bearing and
noninterest-bearing liabilities and stockholders' equity, usually have the
largest impact on periodic changes in our net interest spread, NIM and net
interest income. We measure net interest income before and after the provision
for credit losses.

Noninterest Income. Noninterest income consists of, among other revenue streams:
(i) service fees on deposit accounts; (ii) income from brokerage, advisory and
fiduciary activities; (iii) benefits from and changes in cash surrender value
of bank-owned life insurance, or BOLI, policies; (iv) card and trade finance
servicing fees; (v) securities gains or losses; (vi) net gains and losses on
early extinguishment of FHLB advances; (vii) income from derivative transaction
with customers; (viii) derivative gains or losses, and (ix) other noninterest
income. In addition, noninterest income in 2021 included a gain of $62.4 million
on the sale of the Company's Headquarters Building which is presented separately
in the Company's consolidated statement of operations and comprehensive income.
See "Item 1- Business" for more details.

Our income from service fees on deposit accounts is affected primarily by the
volume, growth and mix of deposits we hold and volume of transactions initiated
by customers (i.e. wire transfers). These are affected by prevailing market
pricing of deposit services, interest rates, our marketing efforts and other
factors.

Our income from brokerage, advisory and fiduciary activities consists of
brokerage commissions related to our customers' trading volume, fiduciary and
investment advisory fees generally based on a percentage of the average value of
assets under management and custody ("AUM"), and account administrative services
and ancillary fees during the contractual period.

Income from changes in the cash surrender value of our BOLI policies represents the amounts that may be realized under the contracts with the insurance carriers, which are nontaxable.

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Interchange fees, other fees and revenue sharing are recognized when earned.
Trade finance servicing fees, which primarily include commissions on letters of
credit, are generally recognized over the service period on a straight line
basis. Card servicing fees include credit and debit card interchange fees and
other fees. We have also entered into referral arrangements with recognized
U.S.-based card issuers, which permit us to serve our customers and earn
referral fees and share interchange revenue without exposure to credit risk.

Our gains and losses on sales of securities are derived from sales from our
securities portfolio and are primarily dependent on changes in U.S. Treasury
interest rates and asset liability management activities. Generally, as U.S.
Treasury rates increase, our securities portfolio decreases in market value, and
as U.S. Treasury rates decrease, our securities portfolio increases in value.We
also recognize unrealized gains or losses on changes in the valuation of
marketable equity securities not held for trading.

Our gains or losses on sales of property and equipment are recorded at the date
of the sale and presented as other noninterest income or expense in the period
they occur.

Our fee income generated on customer interest rate swaps and other loan level
derivatives are primarily dependent on volume of transactions completed with
customers and are included in noninterest income.

In 2022, derivatives unrealized net gains of $0.5 million were primarily derived from changes in market value of uncovered interest rate caps with clients.



Other noninterest income includes mortgage banking income related to Amerant
Mortgage, and consists of gain on sale of loans, gain on loans market valuation,
other fees and smaller sources of income. Mortgage banking income was $3.4
million and $1.7 million in 2022 and 2021, respectively. Amerant Mortgage
commenced operations in May 2021.

Noninterest Expense. Noninterest expenses generally increase as our business
grows and whenever necessary to implement or enhance policies and procedures for
regulatory compliance, and other purposes.

Noninterest expense consists of: (i) salaries and employee benefits; (ii)
occupancy and equipment expenses; (iii) professional and other services fees;
(iv) loan-level derivative expenses; (v) FDIC deposit and business insurance
assessments and premiums; (vi) telecommunication and data processing expenses;
(vii) depreciation and amortization; (viii) advertising and marketing expenses,
and (ix) other operating expenses. In addition, in 2022 noninterest expenses
included: (i) estimated contract termination costs associated with third party
vendors resulting from the Company's transition to our new technology provider,
and (ii) a non-routine charge of $3.4 million resulting from changes in the
estimated fair value and related disposition costs of one OREO property in New
York.

Salaries and employee benefits include compensation (including severance
expenses), employee benefits and employer tax expenses for our personnel.
Salaries and employee benefits are partially offset by costs directly related to
the origination of loans, which are deferred and amortized over the life of the
related loans as adjustments to interest income in accordance with GAAP.

Occupancy expense includes lease expense on our leased properties and other
occupancy-related expenses. Equipment expense includes furniture, fixtures and
equipment related expenses. In 2022, rental income associated with the
subleasing of portions of the Company's headquarters building is included as a
reduction to rent expense under lease agreements under occupancy and equipment
cost. Prior to 2022, rental income primarily in connection with the
previously-owned headquarters building is included as part of other noninterest
income.

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Professional and other services fees include legal, accounting and consulting
fees, card processing fees, director's fees, regulatory agency fees, such as OCC
examination fees, and other fees related to our business operations. In 2022 and
2021, professional fees include expenses associated with the outsourcing of our
internal audit function which began in the second quarter of 2021.

Loan-level derivative expenses are incurred in back-to-back derivative
transactions with commercial loan clients and with brokers. The Company pays a
fee upon inception of the back-to-back derivative transactions, corresponding to
the spread between a wholesale rate and a retail rate.

Contract termination costs represent estimated expenses to terminate contracts
before the end of their terms, and are recognized when the Company terminates a
contract in accordance with its terms, generally considered the time when the
Company gives written notice to the counterparty within the notification period
contractually established. Contract termination costs also include expenses
associated with the abandonment of existing capitalized projects which are no
longer expected to be completed as a result of a contract termination. Changes
to initial estimated expenses to terminate contracts resulting from revisions to
timing or the amount of estimated cash flows are recognized in the period of the
changes.

Advertising expenses include the costs of promoting the Amerant brand, as well
as the costs associated with promoting the Company's products and services to
create positive awareness, or consideration to buy the Company's products and
services. These costs include expenses to produce, deliver and communicate
advertisements using available media and technologies, primarily streaming and
other digital advertising platforms. Advertising expenses are expensed as
incurred, except for media production costs which are expensed upon the first
airing of the advertisement.

FDIC deposit and business insurance assessments and premiums include deposit insurance, net of any credits applied against these premiums, corporate liability and other business insurance premiums.

Telecommunication and data processing expenses include expenses paid to our third-party data processing system providers and other telecommunication and data service providers.

Depreciation and amortization expense includes the value associated with the depletion of the value on our owned properties and equipment, including leasehold improvements made to our leased properties.



Other operating expenses include community engagement, and other operational
expenses. Other operating expenses are partially offset by other operating
expenses directly related to the origination of loans, which are deferred and
amortized over the life of the related loans as adjustments to interest income
in accordance with GAAP.

Noninterest expenses in 2022 and 2021 include salaries and employee benefits,
mortgage lending costs and professional and other service fees in connection
with Amerant Mortgage's ongoing business.


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Non-routine noninterest expense items include restructuring expenses and other
non-routine noninterest expenses. Restructuring expenses are those incurred for
actions designed to implement the Company's strategic initiatives. These actions
include, but are not limited to reductions in workforce, streamlining
operational processes, promoting the Amerant brand, implementation of new
technology system applications, enhanced sales tools and training, expanded
product offerings and improved customer analytics to identify opportunities.
Other non-routine noninterest expenses include the effect of non-core banking
activities such as the valuation of OREO and loans held for sale. The table
below shows a detail of non-routine noninterest expenses for the periods
presented.


                                                                   Years Ended December 31,
(in thousands)                                                 2022          2021          2020
Non-routine noninterest expense items
Restructuring costs:
Staff reduction costs (1)                                   $   3,018      $ 3,604      $  6,405
Contract termination costs (2)                                  7,103            -             -
Legal and Consulting fees (3)                                   3,625        1,689             -
Digital transformation expenses                                    45          412         3,116
Lease impairment charge (4)                                     1,579          810             -
Branch closure expenses (5)                                        33          542         2,404
Total restructuring costs                                   $  15,403      $ 7,057      $ 11,925
Other non-routine noninterest expense items:
Other real estate owned valuation expense (6)                   3,408            -             -
Loans held for sale valuation (reversal) expense (7)              159            -             -
Total non-routine noninterest expense items                 $  18,970

$ 7,057 $ 11,925

____________


(1)  Include severance expense of $3.0 million, $3.6 million and $6.4 million in
2022, 2021 and 2020, respectively. Severance expenses in 2022 were primarily
related to the elimination of certain support functions due to the restructuring
of business lines, as well severance expenses in connection with changes in
certain positions. Severance expenses in 2021 were mainly in connection with the
departure of the Company's COO, the elimination of various support function
positions, and other actions. In 2020, severance expenses were primarily in
connection with a voluntary early retirement plan for certain eligible long-term
employees ( the "2020 Voluntary Plan") and an involuntary severance plan for
certain other positions (the "2020 Involuntary Plan"). See Note 1 to our audited
annual consolidated financial statements in this Form 10-K for more details on
the 2020 Voluntary Plan and the 2020 Involuntary Plan.
(2)  Contract termination and related costs associated with third party vendors
resulting from the engagement of our new technology provider.
(3) In 2022, includes: (i) $2.9 million resulting from the Company's transition
to our new technology provider; (ii) $0.2 million in connection with certain
search and recruitment expenses; (iii) $0.1 million of costs associated with the
subleasing of the New York office space, and (iv) an aggregate of $0.4 million
in other non-routine expenses. In 2021, includes additional expenses of $1.5
million, including: (i) $0.8 million of expenses in connection with the merger
and related transactions, and (ii) $0.7 million resulting from the Company's
transition to our new technology provider.
(4) In 2022, includes $1.6 million of Right-of-Use ("ROU") asset impairment
associated with the closure of a branch in Pembroke Pines, Florida in 2022. In
2021, includes $0.8 million of ROU asset impairment associated with the lease of
the NY loan production office.
(5) In 2022 and 2021, includes lease termination expenses associated with the
closure of a branch in Fort Lauderdale, Florida in 2021.
(6)  Fair value adjustment related to one OREO property in New York.
(7)  Valuation allowance as a result of changes in the fair value of loans held
for sale carried at the lower of cost or fair value.

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Primary Factors Used to Evaluate Our Financial Condition

The primary factors we use to evaluate and manage our financial condition include asset quality, capital and liquidity.



Asset Quality. We manage the diversification and quality of our assets based
upon factors that include the level, distribution and risks in each category of
assets. Problem assets may be categorized as classified, delinquent, nonaccrual,
nonperforming and restructured assets. We also manage the adequacy of our
allowance for credit losses, or the allowance, the diversification and quality
of loan and investment portfolios, the extent of counterparty risks, credit risk
concentrations and other factors.

On January 1, 2022, the Company adopted ASC Topic 326 - Financial Instruments -
Credit Losses, which replaced the incurred loss methodology with an expected
loss methodology that is referred to as the current expected credit loss
("CECL") methodology. See Note 1 to the audited consolidated financial
statements in this Form 10-K for more details on the adoption of CECL by the
Company. We review and update our allowance for expected credit losses
periodically to calibrate loss estimation models based on our loan volumes, and
credit and economic conditions in our markets. The models may differ among our
loan segments to reflect their different asset types, and includes qualitative
factors, which are updated periodically based on the type of loan and other
factors.


Capital. Financial institution regulators have established minimum capital
ratios for banks and bank holding companies. We manage capital based upon
factors that include: (i) the level and quality of capital and our overall
financial condition; (ii) the trend and volume of problem assets; (iii) the
adequacy of reserves; (iv) the level and quality of earnings; (v) the risk
exposures in our balance sheet under various scenarios, including stressed
conditions; (vi) the Tier 1 capital ratio, the total capital ratio, the Tier 1
leverage ratio, and the CET1 capital ratio; (vii) the tangible equity ratio, and
(viii) other factors, including market conditions.

Liquidity. Our deposit base consists primarily of personal and commercial
accounts maintained by individuals and businesses in our primary markets and
select international core depositors. The Company is focused on
relationship-driven core deposits. The Company may also use third party
providers of domestic sources of deposits as part of its balance sheet
management strategies. In 2021, we changed our definition of core deposits to
better align our presentation with the Company's internal monitoring and overall
liquidity strategy. Under this new definition, core deposits consist of total
deposits excluding all time deposits. In prior periods, the Company used the
FFIEC Uniform Bank Performance Report (the "UBPR") definition of "core
deposits," which exclude brokered time deposits and retail time deposits of more
than $250,000. See "Core Deposits" discussion for more details.

We manage liquidity based upon factors that include the amount of core deposit
relationships as a percentage of total deposits, the level of diversification of
our funding sources, the allocation and amount of our deposits among deposit
types, the short-term funding sources used to fund assets, the amount
of non-deposit funding used to fund assets, the availability of unused funding
sources, off-balance sheet obligations, the amount of cash and liquid securities
we hold, the availability of assets readily convertible into cash without undue
loss, the characteristics and maturities of our assets when compared to
the characteristics of our liabilities and other factors.

Seasonality. Our loan production, generally, is subject to seasonality, with the lowest volume typically in the first quarter of each year.


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Summary Results

Results for the year ended December 31, 2022 were as follows:

•Total assets were $9.1 billion at December 31, 2022, up $1.5 billion, or 19.5%, compared to $7.6 billion at December 31, 2021.

•Total gross loans, which include loans held for sale, were $6.9 billion at December 31, 2022, up $1.4 billion, or 24.3%, compared to $5.6 billion at December 31, 2021.

•Average yield on loans in 2022 was 4.92%, up compared to 3.92% in 2021.

•Total deposits were $7.0 billion at December 31, 2022, up $1.4 billion, or 25.1%, compared to December 31, 2021.

•Core deposits were $5.32 billion, at December 31, 2022, up $1.0 billion, or 23.8%, compared to $4.29 billion at December 31, 2021.

•Average cost of total deposits in 2022 was 0.80% compared to 0.49% in 2021.

•Net income attributable to the Company was $63.3 million in 2022, down $49.6 million, or 43.9%, from $112.9 million in 2021.

•Net interest income was $266.7 million in 2022, up $61.5 million, or 30.0%, from $205.1 million in 2021.

•Net interest margin was 3.53% in 2022, up 63 basis points from 2.90% in 2021.



•The Company recorded a provision for credit losses of $13.9 million in 2022,
compared to a release from the allowance for credit losses ("ACL") of $16.5
million in 2021. The ratio of allowance for credit losses to total loans held
for investment was 1.22% as of December 31, 2022, compared to 1.29% as of
December 31, 2021. The ratio of net charge-offs to average total loans held for
investment in the year ended December 31, 2022 was 0.32%, compared to 0.44% in
the year ended December 31, 2021. The ACL coverage of non-performing loans
increased to 2.2x at December 31, 2022, from 1.4x at December 31, 2021.

•Loan to deposit ratio was 98.23% as of December 31, 2022 compared to 98.88% as of December 31, 2021.

•Assets Under Management and custody ("AUM") totaled $2.00 billion as of December 31, 2022 a decrease of $0.2 billion, or 10.1%, compared to $2.22 billion as of December 31, 2021.

•Pre-provision net revenue ("PPNR")1 was $93.9 million in 2022, a decrease of $36.3 million, or 27.9%, compared to $130.1 million in 2021. Core PPNR1 was $105.5 million in 2022, an increase of $35.6 million, or 50.9%, compared to $69.9 million in 2021.

•Noninterest income was $67.3 million in 2022, down $53.3 million, or 44.2%, from $120.6 million in 2021.

•Noninterest expense was $241.4 million in 2022, up $43.2 million, or 21.8%, from $198.2 million in 2021.

•The efficiency ratio was 72.3% in 2022, compared to 60.9% in 2021.


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•Stockholders' book value per common share attributable to the Company was
$20.87 at December 31, 2022, compared to $23.18 at December 31, 2021. Tangible
book value per common share1 was $20.19 as of December 31, 2022, compared to
$22.55 at December 31, 2021.

1 Non-GAAP measure, see "Non-GAAP Financial Measures" for a reconciliation to GAAP.

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Results of Operations - Comparison of Results of Operations for the Years Ended December 31, 2022 and 2021




Net income (loss)

The table below sets forth certain results of operations data for the years ended December 31, 2022, 2021 and 2020:



(in thousands, except per share                       Years Ended December 31,                                                      Change
amounts and percentages)                     2022               2021               2020                      2022 vs 2021                             2021 vs 2020
Net interest income                      $ 266,665          $ 205,141          $ 189,552          $     61,524               30.0  %       $     15,589                8.2  %
Provision for (reversal of) credit
losses                                      13,945            (16,500)            88,620                30,445             (184.5) %           (105,120)            (118.6) %
Net interest income after
provision for (reversal of) credit
losses                                     252,720            221,641            100,932                31,079               14.0  %            120,709              119.6  %
Noninterest income                          67,277            120,621             73,470               (53,344)             (44.2) %             47,151               64.2  %
Noninterest expense                        241,413            198,242            178,736                43,171               21.8  %             19,506               10.9  %
Income (loss) before income tax
(expense) benefit                           78,584            144,020             (4,334)              (65,436)             (45.4) %            148,354                    NM
Income tax (expense) benefit               (16,621)           (33,709)             2,612                17,088               50.7  %            (36,321)                   NM
Net income (loss) before
attribution of noncontrolling
interest                                    61,963            110,311             (1,722)              (48,348)             (43.8) %            112,033                    NM
Less: noncontrolling interest               (1,347)            (2,610)                 -                 1,263               48.4  %             (2,610)                   NM
Net income attributable to Amerant
Bancorp Inc.                             $  63,310          $ 112,921          $  (1,722)         $    (49,611)             (43.9) %       $    114,643                    NM
Basic earnings (loss) per common
share                                    $    1.87          $    3.04          $   (0.04)         $      (1.17)             (38.5) %       $       3.08                    NM
Diluted earnings (loss) per common
share (1)                                $    1.85          $    3.01          $   (0.04)         $      (1.16)             (38.5) %       $       3.05                    NM

__________________


(1)  At December 31, 2022 and 2021, potential dilutive instruments consist of
unvested shares of restricted stock, restricted stock units and performance
stock units (consisted of unvested shares of restricted stock and restricted
stock units at December 31, 2020). See Note 23 to our audited annual
consolidated financial statements in this Form 10-K for details on the dilutive
effects of the issuance of restricted stock, restricted stock units and
performance stock units on earnings per share in 2022, 2021 and 2020.
NM - means not meaningful


2022 compared to 2021

In 2022, net income attributable to the Company was $63.3 million, or $1.85 per
diluted share, compared to net income of $112.9 million, or $3.01 per diluted
share, in 2021. The decrease of $49.6 million, or 43.93% , in 2022 compared to
2021 was primarily due to: (i) lower noninterest income mainly driven by the
absence of a $62.4 million gain on the sale of the Company's headquarters
building in 2021; (ii) higher noninterest expenses, and (iii) the $13.9 million
provision for credit losses in 2022, compared to a $16.5 million reversal from
the allowance for credit losses in 2021. These results were partially offset by
higher net interest income in 2022 compared to 2021.

In 2022 and 2021, net income attributable to the Company excludes a net loss of
$1.3 million and $2.6 million, respectively, attributable to the non-controlling
interest of Amerant Mortgage, which commenced operations in May 2021. These
losses were calculated on the basis of a net loss from operations for Amerant
Mortgage (including transactions with affiliates such as broker fees, interest
expense and other operating expenses) of $3.3 million and $5.3 million,
respectively. In the first quarter of 2022, the minority interest share in
Amerant Mortgage changed from 49% to 42.6%. In addition, in the second quarter
of 2022, the minority interest share in Amerant Mortgage changed from 42.6% to
20%. See "Item 1 - Business Developments" in this Form 10-K for more details on
these changes with respect to our subsidiary Amerant Mortgage.

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Net interest income was $266.7 million in 2022, an increase of $61.5 million, or
30.0%, from $205.1 million in 2021. This was primarily the result of: (i) higher
average yields on loans, debt securities available for sale and held to maturity
and interest earning deposits with banks; (ii) higher average balance of loans
and debt securities held to maturity, and (iii) lower average balances of time
deposits. These results were partially offset by: (i) higher cost of total
deposits, FHLB advances and junior subordinated debentures; (ii) higher average
balance of FHLB advances; (iii) lower average balance of debt securities
available for sale, and (iv) the cost of the subordinated debt issued in March
2022. The increase in average yields on interest earning assets includes the
effect of the Federal Reserve's actions to manage inflation in 2022 which
consisted of raising its benchmark rate by a total of 425 basis points during
2022. See "-Net interest Income" for more details.

Noninterest income was $67.3 million in 2022, a decrease of $53.3 million, or
44.2%, compared to $120.6 million in 2021. These results were mainly due to: (i)
the absence of a gain on the sale of the Company's headquarters building in 2021
of $62.4 million ; (ii) lower net gains on securities of $7.4 million, primarily
due to lower gains on sale of debt securities available for sale; (iii) the
absence of a gain of $3.8 million on the sale of $95.1 million of loans under
the SBA's Pay Check Protection Program ("PPP") in 2021, and (iv) lower total
brokerage, advisory and fiduciary activities. These results were partially
offset by: (i) higher net gains on the early extinguishment of FHLB advances;
(ii) higher loan-level derivative income; (iii) higher mortgage banking income;
(iv) higher deposit and service fees; (v) net unrealized derivative gains of
$0.5 million in 2022 related to interest rate caps with clients, and (vi) higher
cards and trade finance servicing fees. In 2022, the Company recorded total net
gains of $10.7 million on the early extinguishment of approximately $355 million
of FHLB advances. In 2021, the Company recorded a loss of $2.5 million on the
early extinguishment of approximately $235 million of FHLB advances. See
"-Noninterest Income" for more details.

Noninterest expense was $241.4 million in 2022, an increase of $43.2 million, or
21.8%, from $198.2 million in 2021. This was primarily driven by higher
advertising expenses, loan-level derivative expenses, occupancy and equipment
costs, salaries and employee benefits, professional and other services fees and
other operating expenses. Also, in 2022, noninterest expenses include: (i) $7.1
million of estimated contract termination costs associated with third party
vendors resulting from the Company's transition to our new technology provider;
(ii) a non-routine charge of $3.4 million resulting from changes in the
estimated fair value and related disposition costs of one OREO property in New
York, and (iii) a valuation allowance of $0.2 million related to the change in
fair value of New York loans held for sale. These increases were partially
offset by lower depreciation and amortization expenses.See "-Noninterest
Expense" for more details.


In 2022, noninterest expense included non-routine items of $19.0 million,
compared to $7.1 million in 2021. Non-routine items in noninterest expense
include restructuring costs of $15.4 million and $7.1 million in 2022 and 2021,
respectively. In addition, in 2022, non-routine items in noninterest expense
include: (i) a non-routine charge of $3.4 million resulting from the changes in
the estimated fair value and related disposition costs of an OREO property in
New York, and (ii) a valuation allowance of $0.2 million related to the change
in fair value of New York loans held for sale. See "Our Company - Primary
Factors Used to Evaluate Our Business" for detailed information on non-routine
items in noninterest expense.

In 2022 and 2021, we incurred $12.5 million and $7.1 million, respectively, in
noninterest expenses related to Amerant Mortgage, which commenced operations in
May 2021. These expenses included: (i) $8.9 million and $5.5 million in 2022 and
2021, respectively, related to salaries and employee benefits expenses, and (ii)
$3.6 million and $1.6 million in 2022 and 2021, respectively, related to
mortgage lending costs, professional fees and other noninterest expenses.
Amerant Mortgage had 68 FTEs at December 31, 2022 compared to 72 FTEs at
December 31, 2021.






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Average Balance Sheet, Interest and Yield/Rate Analysis



The following tables present average balance sheet information, interest income,
interest expense and the corresponding average yields earned and rates paid for
the years ended December 31, 2022, 2021 and 2020. The average balances for loans
include both performing and nonperforming balances. Interest income on loans
includes the effects of discount accretion and the amortization of
non-refundable loan origination fees, net of direct loan origination costs,
accounted for as yield adjustments. Average balances represent the daily average
balances for the periods presented.

                                                                                                             Years Ended December 31,
                                                            2022                                                           2021                                                       2020
(in thousands, except                   Average                Income/             Yield/             Average             Income/             Yield/             Average             Income/             Yield/
percentages)                           Balances                Expense             Rates              Balances            Expense             Rates              Balances            Expense             Rates
Interest-earning assets:
Loan portfolio, net (1) (2)     $            5,963,190       $ 293,210               4.92  %       $ 5,514,110          $ 216,097               3.92  %       $ 5,716,371          $ 220,898               3.86  %
Debt securities available for
sale (3)(4)                                  1,112,590          33,187               2.98  %         1,194,505             26,953               2.26  %         1,444,213             34,001               2.35  %
Debt securities held to
maturity (5)                                   192,397           5,657               2.94  %            97,501              2,036               2.09  %            66,136              1,343               2.03  %
Debt securities held for
trading                                             64               4               6.25  %               165                  5               3.03  %                 -                  -                  -  %
Equity securities with readily
determinable fair value not
held for trading                                 9,560               -                  -  %            22,332                284               1.27  %            24,290                452               1.86  %
Federal Reserve Bank and FHLB
stock                                           51,496           2,565               4.98  %            53,106              2,222               4.18  %            67,840              3,227               4.76  %
Deposits with banks                            231,402           4,153               1.79  %           201,950                247               0.12  %           202,026                633               0.31  %
Total interest-earning assets                7,560,699         338,776               4.48  %         7,083,669            247,844               3.50  %         7,520,876            260,554               3.46  %
Total non-interest-earning
assets (6)                                     626,989                                                 449,347                                                    510,673
Total assets                    $            8,187,688                                             $ 7,533,016                                                $ 8,031,549


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                                                                                                       Years Ended December 31,
                                                       2022                                                      2021                                                      2020
(in thousands, except               Average            Income/


Yield/             Average             Income/            Yield/             Average             Income/            Yield/
percentages)                       Balances            Expense             Rates             Balances            Expense             Rates             Balances            Expense             Rates
Interest-bearing liabilities:
Checking and saving accounts:
Interest bearing DDA              1,872,100             15,118              0.81  %         1,309,699                591              0.05  %         1,154,166                439              0.04  %
Money market                      1,323,563             11,673              0.88  %         1,311,278              3,483              0.27  %         1,165,447              7,070              0.61  %
Savings                             319,631                135              0.04  %           324,618                 50              0.02  %           321,766                 58              0.02  %
Total checking and saving
accounts                          3,515,294             26,926              0.77  %         2,945,595              4,124              0.14  %         2,641,379              7,567              0.29  %
Time deposits                     1,334,605             22,124              1.66  %         1,668,459             23,766              1.42  %         2,360,367             45,765              1.94  %
Total deposits                    4,849,899             49,050              1.01  %         4,614,054             27,890              0.60  %         5,001,746             53,332              1.07  %
Securities sold under
agreements to repurchase                 32                  1              3.13  %               123                  1              0.81  %               252                  1              0.40  %
Advances from the FHLB and
other borrowings (7)                911,448             15,092              1.66  %           822,769              8,595              1.04  %         1,116,899             13,168              1.18  %
Senior notes                         59,054              3,766              6.38  %            58,737              3,768              6.42  %            30,686              1,968              6.41  %
Subordinated notes                   23,853              1,172              4.91  %                 -                  -                 -  %                 -                  -                 -  %
Junior subordinated debentures       64,178              3,030              4.72  %            64,178              2,449              3.82  %            66,402              2,533              3.81  %
Total interest-bearing
liabilities                       5,908,464             72,111              1.22  %         5,559,861             42,703              0.77  %         6,215,985             71,002              1.14  %

Non-interest-bearing

liabilities:


Non-interest bearing demand
deposits                          1,286,570                                                 1,046,766

876,393


Accounts payable, accrued
liabilities and other
liabilities                         243,105                                                   130,548

100,932


Total non-interest-bearing
liabilities                       1,529,675                                                 1,177,314

977,325


Total liabilities                 7,438,139                                                 6,737,175

7,193,310


Stockholders' equity                749,549                                                   795,841

838,239


Total liabilities and
stockholders' equity            $ 8,187,688                                               $ 7,533,016                                               $

8,031,549


Excess of average
interest-earning assets over
average interest-bearing
liabilities                     $ 1,652,235                                               $ 1,523,808                                               $

1,304,891


Net interest income                                  $ 266,665                                                 $ 205,141                                                 $ 189,552
Net interest rate spread                                                    3.26  %                                                   2.73  %                                                   2.32  %
Net interest margin (8)                                                     3.53  %                                                   2.90  %                                                   2.52  %
Cost of total deposits (9)                                                  0.80  %                                                   0.49  %                                                   0.91  %
Ratio of average
interest-earning assets to
average interest-bearing
liabilities                          127.96  %                                                 127.41  %                                                 120.99  %
Average non-performing loans/
average total loans                    0.51  %                                                   1.61  %                                                   1.12  %


__________________
(1)  Includes loans held for investment net of the allowance for credit losses,
and loans held for sale. The average balance of the allowance for credit losses
was $57.5 million, $101.1 million and $91.5 million in the years ended
December 31, 2022, 2021 and 2020, respectively. The average balance of total
loans held for sale was $117.6 million, $72.7 million and $37 thousand in the
years ended December 31, 2022, 2021 and 2020, respectively.
(2)  Includes average non-performing loans of $90.6 million, $90.6 million and
$64.8 million for the years ended December 31, 2022, 2021 and 2020,
respectively. Interest income that would have been recognized on outstanding
non-performing loans at December 31, 2022, 2021 and 2020 was $0.8 million, $6.2
million and $2.7 million in 2022, 2021 and 2020, respectively.
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(3) Includes the average balance of net unrealized gains and losses in the fair
value of debt securities available for sale. The average balance includes
includes average net unrealized losses of $62.3 million in 2022 and average net
unrealized gains of $26.6 million and $35.5 million in 2021 and 2020,
respectively.
(4)  Includes nontaxable securities with average balances of $18.4 million,
$46.2 million and $72.2 million for the years ended December 31, 2022, 2021 and
2020, respectively. The tax equivalent yield for these nontaxable securities was
3.00%, 1.76% and 2.94% for the years ended December 31, 2022, 2021 and 2020,
respectively. In 2022, 2021 and 2020, the tax equivalent yield was calculated by
assuming a 21% tax rate and dividing the actual yield by 0.79.
(5)  Includes nontaxable securities with average balances of $43.6 million,
$50.2 million and $66.1 million for the years ended December 31, 2022, 2021 and
2020, respectively. The tax equivalent yield for these nontaxable securities was
3.46%, 2.58% and 2.57% for the years ended December 31, 2022, 2021 and 2020,
respectively. In 2022, 2021 and 2020, the tax equivalent yield was calculated
assuming a 21% tax rate and dividing the actual yield by 0.79.
(6)  Excludes the allowance for credit losses.
(7)  The terms of the advance agreement require the Bank to maintain certain
investment securities or loans as collateral for these advances.
(8)  Net interest margin is defined as net interest income divided by average
interest-earning assets, which are loans, securities, deposits with banks and
other financial assets, which yield interest or similar income.
(9) Calculated based upon the average balance of total noninterest bearing and
interest bearing deposits.



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Interest Rates and Operating Interest Differential



Increases and decreases in interest income and interest expense result from
changes in average balances (volume) of interest-earning assets and
interest-bearing liabilities, as well as changes in average interest rates. In
this table, we present for the periods indicated, the changes in interest income
and the changes in interest expense attributable to the changes in interest
rates and the changes in the volume of interest-earning assets and
interest-bearing liabilities. For each category of assets and liabilities,
information is provided on changes attributable to: (i) change in volume (change
in volume multiplied by prior year rate); (ii) change in rate (change in rate
multiplied by prior year volume); and (iii) change in both volume and rate which
is allocated to rate. See "Risk Factors- Our profitability is subject to
interest rate risk."

Increase in Net Interest Income


                                                       2022 vs 2021                                            2021 vs 2020
                                                      Attributable to                                        Attributable to
(in thousands)                          Volume             Rate              Total             Volume              Rate              Total
Interest income attributable to:
Loan portfolio, net                   $ 17,604          $ 59,509          $

77,113 $ (7,807) $ 3,006 $ (4,801) Debt securities available for sale (1,851)

            8,085             6,234             (5,868)            (1,180)            (7,048)
Debt securities held to maturity         1,983             1,638             3,621                637                 56                693
Debt securities held for trading            (3)                2                (1)                 5                  -                  5
Equity securities with readily
determinable fair value not held for
trading                                   (162)             (122)             (284)               (36)              (132)              (168)
Federal Reserve Bank and FHLB stock        (67)              410               343               (701)              (304)            (1,005)
Deposits with banks                         35             3,871             3,906                  -               (386)              (386)
Total interest-earning assets         $ 17,539          $ 73,393          $ 90,932          $ (13,770)         $   1,060          $ (12,710)
Interest expense attributable to:
Checking and saving accounts:
Interest bearing demand               $    281          $ 14,246          $ 14,527          $      62          $      90          $     152
Money market                                33             8,157             8,190                890             (4,477)            (3,587)
Savings                                     (1)               86                85                  1                 (9)                (8)
Total checking and saving accounts         313            22,489            22,802                953             (4,396)            (3,443)
Time deposits                           (4,741)            3,099            (1,642)           (13,423)            (8,576)           (21,999)
Total deposits                          (4,428)           25,588            21,160            (12,470)           (12,972)           (25,442)
Securities sold under agreements to
repurchase                                  (1)                1                 -                 (1)                 1                  -
Advances from the FHLB and other
borrowings                                 922             5,575             6,497             (3,471)            (1,102)            (4,573)
Senior notes                                20               (22)               (2)             1,798                  2              1,800
Subordinated notes                       1,172                 -             1,172                  -                  -                  -
Junior subordinated debentures               -               581               581                (85)                 1                (84)

Total interest-bearing liabilities $ (2,315) $ 31,723 $ 29,408 $ (14,229) $ (14,070) $ (28,299) Increase in net interest income $ 19,854 $ 41,670 $ 61,524 $ 459 $ 15,130 $ 15,589

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In March 2022, the Federal Reserve increased its benchmark interest rate by 25
basis points as a key tool to help reduce inflationary pressures. This first
increase was followed by 6 additional increases in the Federal Reserve's
benchmark interest rates in 2022 (50 basis points in May 2022, 75 basis points
in each June 2022, July 2022, September 2022 and November 2022, and 50 basis
points in December 2022) which resulted in a total increase of 425 basis points
year-to- date. This accumulated increase of 425 basis point in the Federal
Reserve's benchmark interest rates in 2022 contributed to the increase in net
interest income the Company experienced in 2022.

In 2022, the Company continued seeking opportunities to improve NIM through: (i)
purchases of single-family residential loans through Amerant Mortgage; (ii)
continued purchases of consumer loans under indirect lending programs; (iii)
originations of commercial loans and leases under a new white label equipment
finance solution launched in the second quarter of 2022, and (iv) originations
of consumer loans under a separate white label program. In addition, in 2022 we
believe that changes in deposit rates managed on a case-by-case-basis, curtailed
increase in deposit costs during the period. Furthermore, in 2022, in light of
the rising rate environment, the Company actively managed the duration of FHLB
advances by: (i) repaying $530.0 million in callable FHLB advances, and (ii)
borrowing $550.0 million in longer-term advances to extend the duration of this
portfolio and lock-in fixed interest rates. Lastly, in the first quarter of
2022, we completed a private placement of $30 million of 4.25% fixed-to-floating
rate subordinated notes due 2032. See discussions further below for more details
on the subordinated notes.


Net interest income

2022 compared to 2021

In 2022, net interest income was $266.7 million, an increase of $61.5 million,
or 30.0%, from $205.1 million in 2021. This was mainly driven by: (i) an
increase of 98 basis points in the yield on total interest earning assets,
mainly loans, debt securities available for sale and held to maturity and
interest earnings deposits with banks; (ii) higher average balance of loans and
debt securities held to maturity, and (iii) lower average balance of time
deposits. The increase in net interest income was partially offset by: (i)
higher cost of total deposits, FHLB advances and junior subordinated debentures;
(ii) higher average balance of FHLB advances, and (iii) a decrease of $81.9
million, or 6.9% in the average balance of debt securities available for sale.
In addition, 2022 includes the additional interest expense associated with
subordinated notes issued in March 2022. The increase in average yields on
interest earning assets includes the effect of the Federal Reserve's actions to
manage inflation in 2022, which consisted of raising its benchmark rate by a
total of 425 basis points in 2022. Net interest margin was 3.53% in 2022, an
increase of 63 basis points from 2.9% in 2021. See discussions further below for
more details.

Interest Income. Total interest income was $338.8 million in 2022, an increase
of $90.9 million, or 36.7% compared to $247.8 million in 2021. This was
primarily driven by a 98 basis points increase in the average yield on total
interest earning assets, mainly driven by higher market rates on loans, debt
securities available for sale and held to maturity and interest earning deposits
with banks. In addition, there were increases of $449.1 million, or 8.1%, and
$94.9 million, or 97.3%, in the average balance of loans and debt securities
held to maturity, respectively. These increases were partially offset by a
decrease of $81.9 million, or 6.9%, in the average balance of debt securities
available for sale. See "-Average Balance Sheet, Interest and Yield/Rate
Analysis" for detailed information.

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Interest income on loans in 2022 was $293.2 million, an increase of $77.1
million, or 35.7%, compared to $216.1 million in 2021. This result was primarily
due to a 100 basis points increase in average yields, mainly attributable to
higher market rates as well as higher-yielding consumer loans purchased
throughout 2021 and 2022. Also, in 2022, there was an increase of $449.1
million, or 8.1%, in the average balance of loans compared to 2021, mainly
attributable to: (i) purchases of consumer loans under indirect lending programs
as discussed above; (ii) higher volumes of single-family residential loans;
(iii) higher volumes of commercial loans primarily driven by our loan
origination and cross-sale efforts in 2022, including, among other things, loans
originated under a white-label equipment financing solution launched in 2022,
and (iv) consumer loans originated under a white-label program launched in 2022.
The increase in the average balance of loans was partially offset by: (i) a
lower average balance of CRE loans, mainly driven by prepayments during the
period; (ii) the sale of approximately $57.3 million and $49.4 million in the
first quarter of 2022 and the fourth quarter of 2021, respectively, of New York
real estate loans, and (iii) the sale of and forgiveness of PPP loans in 2021.
See "-Average Balance Sheet, Interest and Yield/Rate Analysis" for detailed
information. See "Loans" for more detailed on the sale of NY real estate loans.

Interest income on debt securities available for sale was $33.2 million in 2022,
an increase of $6.2 million, or 23.1%, compared to $27.0 million in 2021. This
was mainly due to an increase of 72 basis points in average yields, primarily on
lower prepayments and higher market rates. This was partially offset by a
decrease of $81.9 million, or 6.9%, in the average balance of these securities.
The decline in the average balance was primarily due to prepayments and a
decrease in carrying value due to market rates increasing throughout 2022. In
2022, the average balance of accumulated net unrealized loss included in the
carrying value of these securities was $62.3 million compared to accumulated net
unrealized gain of $26.6 million in 2021. As of December 31, 2022, corporate
debt securities comprised 26.5% of the available-for-sale portfolio, down from
30.4% at December 31, 2021. We continue with our strategy to insulate the
investment portfolio from prepayment risk. As of December 31, 2022, floating
rate investments represent 13.2% of our total investment portfolio compared to
10.6% at December 31, 2021. In addition, the overall duration increased to 4.9
years at December 31, 2022 from 3.6 years at December 31, 2021, which was
primarily due to lower expected and actual mortgage-backed securities
prepayments resulting from increased market interest rates. See "-Average
Balance Sheet, Interest and Yield/Rate Analysis" for detailed information.

Interest income on debt securities held to maturity was $5.7 million in 2022, an
increase of $3.6 million, or 177.8%, compared to $2.0 million in 2021. This was
mainly due to an increase of 85 basis points in average yields, primarily driven
by higher market rates. In addition, there was an increase of $94.9 million, or
97.3% in the average balance of these securities.

Interest Expense. Interest expense was $72.1 million in 2022, an increase of
$29.4 million, or 68.9%, compared to $42.7 million in 2021. This was primarily
due to: (i) higher cost of total deposits, FHLB advances and junior subordinated
debentures; (ii) higher average balance of FHLB advances, and (iii) the
additional interest expense associated with the subordinated notes issued in
March 2022. This was partially offset by: (i) a decrease of $333.9 million, or
20.0%, in the average balance of time deposits.


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Interest expense on interest-bearing deposits was $49.1 million in 2022, an
increase of $21.2 million or 75.9%, compared to $27.9 million in 2021. This
increase was mainly driven by: (i) higher cost of total deposits, and (ii) an
increase of $569.7 million, or 19.3%, in the average balance on interest bearing
checking and savings accounts. This increase was partially offset by: (i) a
decrease of $333.9 million, or 20.0%, in the average balance of total time
deposits. See below for a detailed explanation of changes by major deposit
category:

•Time deposits. Interest expense on total time deposits decreased $1.6 million,
or 6.9%, in 2022 compared to 2021. This was mainly driven by a decrease of
$333.9 million, or 20.0%, in the average balance, including a decrease of $90.4
million in the average balance of international time deposits. These declines
were partially offset by an increase of 24 basis points in the average cost of
total time deposits. The decline in the average balance of total time deposits
include decreases of $218.9 million, $54.7 million and $60.3 million, in
customer certificate of deposits ("CDs"), brokered deposits and online deposits,
respectively. The decline in customer CDs reflects the Company's continued
efforts to aggressively lower CD rates and focus on increasing core deposits and
emphasizing multiproduct relationships versus single product higher-cost CDs.

•Interest bearing checking and savings accounts. Interest expense on total
interest bearing checking and savings accounts increased $22.8 million, or
552.9%, in 2022 compared to 2021, mainly due to an increase of 63 basis points
in the average costs of these instruments. In addition, there was an increase of
$569.7 million, or 19.3% in the average balance of total interest bearing
checking and savings accounts in 2022 compared to 2021, mainly driven by: (i)
higher average domestic personal accounts; (ii) new domestic deposits from
escrow accounts, municipalities, and from domestic individuals and businesses
through large fund providers as well as new large customer relationships in
2022, and (iii) an increase of $53.5 million, or 2.6%, in the average balance of
international accounts, including increases of $26.2 million or 1.5%, and $27.3
million, or 7.5%, in personal and commercial accounts, respectively. These
increases in average balances were partially offset by a decline of $75.3
million in the average balance of third-party interest-bearing domestic brokered
deposits in 2022 compared to 2021, as the Company continued to focus on reducing
reliance on this source of funding.

Interest expense on FHLB advances increased $6.5 million, or 75.6%, in 2022
compared to 2021, mainly due to an increase of 62 basis points in the average
rate paid on these borrowings. In addition, there was an increase of $88.7
million or 10.8%, in the average balance on this funding source. In 2022 and
2021, interest expense on FHLB advances includes $1.9 million and $1.2 million,
respectively, related to the amortization of a $6.6 million penalty fee as
result of the restructuring of $285 million in fixed-rate FHLB advances in May
2021. In the first half of 2022, the Company borrowed $550 million in
longer-term fixed FHLB advances and repaid $530 million in FHLB callable
advances to extend the duration of this portfolio and lock-in fixed interest
rates. In addition, in the third quarter of 2022, the Company borrowed $150.0
million in fixed-rate FHLB advances to support loan growth. Lastly, in the
fourth quarter of 2022, the Company repaid approximately $175.0 million of FHLB
advances as we took advantage of the increased market valuation of these
instruments at the time of repayment. See discussions further below for more
details on the $285 million FHLB advances restructuring completed in May 2021.

Interest expense on subordinated notes was $1.2 million in 2022. We had no interest expense on subordinated notes in 2021. See "Capital Resources and Liquidity Management" in this Form 10-K for more information on the Subordinated Notes.



Interest expense on junior subordinated debentures increased $0.6 million, or
23.7%, in 2022 compared to 2021, mainly driven by (i) the maturity of existing
cash flow hedges and (ii) new cash flow hedge agreements in place related to the
subordinated debentures. See Note 12 "Derivative Instruments" in our audited
annual consolidated financial statements in this Form 10-K for more details
regarding this activity. The combined impact of the maturation of existing and
new agreements in place resulted in an increase of 90 basis points in the
average rate paid on these instruments.

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Analysis of the Allowance for Credit Losses

Set forth in the table below are the changes in the allowance for loan losses for each of the periods presented.



                                                                         Years Ended December 31,
(in thousands)                                2022               2021               2020              2019               2018

Balance at the beginning of the period $ 69,899 $ 110,902

     $  52,223          $ 61,762          $  72,000
Cumulative effect of adoption of
accounting principle (1)                     18,674                  -                  -                 -                  -

Charge-offs
Domestic Loans:
Real estate loans
Commercial real estate (CRE)
Nonowner occupied                         $  (3,852)         $ (11,062)         $       -          $      -          $  (5,839)

Single-family residential                       (10)              (218)               (27)             (136)               (27)
Owner occupied                                    -                  -                (75)                -                  -
                                             (3,862)           (11,280)              (102)             (136)            (5,866)
Commercial                                   (9,114)           (13,227)           (29,883)           (2,970)            (3,662)
Consumer and others                          (9,122)            (3,273)              (573)             (638)              (167)
                                            (22,098)           (27,780)           (30,558)           (3,744)            (9,695)

International Loans (2):
Commercial                                        -                  -                (34)              (62)            (1,473)
Single-family residential                        (4)                 -                  -                 -                  -
Consumer and others                              (4)                 -               (269)           (5,033)            (1,392)
                                                 (8)                 -               (303)           (5,095)            (2,865)
Total Charge-offs                         $ (22,106)         $ (27,780)         $ (30,861)         $ (8,839)         $ (12,560)

Recoveries
Domestic Loans:
Real estate loans
Commercial real estate (CRE)
Nonowner occupied                         $       -          $       -          $       -          $      -          $      39
Multi-family residential                          -                  -                  -                 -                  -
Land development and construction loans          47                125                  -               190                173
                                                 47                125                  -               190                212
Single-family residential                       199                131                120               230                176
Owner occupied                                    -                  -                  -                19                891
                                                246                256                120               439              1,279
Commercial                                    1,714              1,825                319             1,207                435
Consumer and others                             134                345                 58                13                 46
                                              2,094              2,426                497             1,659              1,760

International Loans (2):
Real Estate
Single-family residential                         -                  -                  -                 -                  4
Commercial                                      971                788                124               485                 41
Consumer and others                              23                 63                299               306                142
                                                994                851                423               791                187
Total Recoveries                          $   3,088          $   3,277          $     920          $  2,450          $   1,947

Net charge-offs                             (19,018)           (24,503)           (29,941)           (6,389)           (10,613)

Provision for (reversal of) credit losses    13,945            (16,500)            88,620            (3,150)               375

Balance at the end of the period $ 83,500 $ 69,899

    $ 110,902          $ 52,223          $  61,762


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______________

(1) See Note 1 to our audited annual consolidated financial statements in this Form 10-K for details on the adoption of the new accounting standard on estimating expected credit losses on financial instruments (CECL). (2) Includes transactions in which the debtor or the customer is domiciled outside the U.S., even when the collateral is located in the U.S.

2022 compared to 2021



The Company adopted CECL in 2022 using a modified retrospective approach. As a
result of the CECL adoption, the ACL increased $18.9 million as of January 1,
2022. The Company recorded a provision for credit losses of $13.9 million in
2022, compared to a release from the ACL of $16.5 million in 2021. Also the
company recorded $19.0 million in net charge-offs, a decrease compare to $24MM
in 2021. The $13.9 million provision for credit losses in 2022 includes $17.7
million for loan growth and $15.2 million in additional reserves requirements
for charge-off on loans which had no reserves from previous periods. These
results were partially offset by releases from the ACL in 2022, including: (i)
$15.9 million as a result of loss factor updates; and (ii) 3.1 million due to
recoveries.


While most of the measures and restrictions enacted during the COVID-19 pandemic
have been lifted, and businesses have reopened, generally, the Company cannot
predict when circumstances may change and whether restrictions that have been
lifted will need to be imposed or tightened in the future if viewed as necessary
due to public health concerns. Given the uncertainty regarding the spread and
severity of the COVID-19 pandemic and its adverse effects on the U.S. and global
economies, the impact to the Company's loan portfolio cannot be accurately
predicted at this time.

Additionally, in late September 2022, the Hurricane impacted several countries
in the Caribbean, and the U.S., causing significant damage, and disrupting
businesses in several regions, including several South and Central Florida
counties in which the Company does business, including the Tampa Bay, Port
Charlotte, Naples and Orlando markets and their surrounding areas. See -
"Hurricane Ian" in "Item1- Business" for more information about the Hurricane.
The Company has not identified any significant impacts to the loan portfolio of
the Company deemed to be located in the areas that may have been meaningfully
impacted by the Hurricane, and the Company has not identified any immediate
significant impact to the collateral securing the loans in the exposed loan
portfolio in the region. The Company has been in contact with the impacted
borrowers and has been performing site visits as well. Since there is
significant uncertainty with respect to the full extent of the negative impacts
due to the unprecedented nature of the Hurricane, the Company's estimates with
respect to the loan portfolio potentially impacted and the ACL are based on
judgment and subject to change as conditions evolve. The Company will continue
to carefully assess and review the exposure of the portfolios to
hurricane-related factors, economic trends and their effect on credit quality
and that assessment and review could result in further loan loss provisions in
future periods. There was no impact to our Tampa, FL operation as a result of
the Hurricane.

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During 2022, charge-offs decreased $5.7 million, or 20.4%, compared to 2021. In
2022, charge-offs included: (i) $6.1 million related to two commercial
nonaccrual loans paid off during the period, including $3.6 million related to a
Miami-based U.S. coffee trader ("the Coffee Trader") and $2.5 million related to
other loan; (ii) $3.9 million related to a New York based non-owner occupied
loan; (iii) $3.0 million related to multiple commercial loans, and (iv) an
aggregate $9.1 million related to multiple consumer loans. In 2022, the Company
changed its policy for charging off unsecured consumer loans when balances are
past-due 90 days or more. Previously, the Company charged-off these loan types
when balances were 120 days past due. The Company believes this change is in
line with prevalent practices in the marketplace. As a result of the change in
policy, charge-offs in 2022 include $3.4 million from this policy change. In
2021, charge-offs included: (i) $11.1 million related to two non-owner occupied
loans, including $7.9 million related to a single-tenant loan in New York which
was sold in the fourth quarter of 2021, and $3.2 million related to a loan in
New York transferred to OREO in the third quarter of 2021; (ii) $13.2 million
primarily related to commercial loans, mainly comprised of $5.7 million in
connection with the Coffee Trader, and a total of $5.6 million related to four
commercial loans over $1 million each, and (iii) an aggregate of $3.1 million of
charge-offs related to consumer loans purchased under indirect lending programs.
The ratio of net charge-offs over the average total loan portfolio held for
investment was 0.32% in 2022 compared to 0.44% in 2021.

In the fourth quarter of 2022, the Company placed in nonaccrual status a New
York-based non-owner occupied loan in the retail industry with a carrying amount
of $24.0 million. The Company had charged-off $3.9 million in the fourth quarter
of 2022. The Company is in the process of obtaining title to the property and
expects to complete the transfer to OREO in the first quarter of 2023.

As of December 31, 2021, the Coffee Trader had an outstanding balance of
approximately $9.1 million. In the second quarter of 2022, the Company collected
a partial principal payment of $5.5 million and charged off the remaining
balance of $3.6 million against the ACL. Therefore, as of December 31, 2022,
there were no outstanding balances associated with this loan relationship.

During 2022, consistent with the Company's applicable policy, the Company
obtained independent third-party collateral valuations on all real estate
securing non-performing loans with existing valuations older than 12-months, to
support current ACL levels. No additional provision for credit loss was deemed
necessary as a result of these valuations.

We continue to proactively and carefully monitor the Company's credit quality
practices, including examining and responding to patterns or trends that may
arise across certain industries or regions.

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Noninterest Income

The table below sets forth a comparison for each of the categories of noninterest income for the periods presented.



                                                                Years Ended December 31,                                                                               Change
(in thousands, except                  2022                               2021                                2020                              2022 vs 2021                            2021 vs 2020
percentages)                 Amount              %               Amount              %              Amount              %                Amount                 %                 Amount                 %
Deposits and service fees  $ 18,592             27.6  %       $  17,214             14.3  %       $ 15,838             21.6  %       $      1,378                8.0  %       $      1,376               8.7  %
Brokerage, advisory and
fiduciary activities         17,708             26.3  %          18,616             15.4  %         16,949             23.1  %               (908)              (4.9) %              1,667               9.8  %
Loan-level derivative
income (1)                   10,360             15.4  %           3,951              3.3  %          3,173              4.3  %              6,409              162.2  %                778              24.5  %
Change in cash surrender
value of bank owned life
insurance (BOLI)(2)           5,406              8.0  %           5,459              4.5  %          5,695              7.8  %                (53)              (1.0) %               (236)             (4.1) %
Cards and trade finance
servicing fees                2,276              3.4  %           1,771              1.5  %          1,346              1.8  %                505               28.5  %                425              31.6  %
Gain on sale of sale of
Headquarters Building (3)         -                -  %          62,387             51.7  %              -                -  %            (62,387)                 -  %             62,387                  N/M
Securities (losses) gains,
net (4)                      (3,689)            (5.5) %           3,740              3.1  %         26,990             36.7  %             (7,429)            (198.6) %            (23,250)            (86.1) %

Gain (loss) on early
extinguishment of FHLB
advances, net                10,678             15.9  %          (2,488)            (2.1) %            (73)            (0.1) %             13,166                   N/M             (2,415)                 N/M
Derivatives gains
(losses,) net (5)               455                1  %               -                -  %              -                -  %                455                   N/M                  -                 -  %
Other noninterest income
(6)(7)                        5,491              8.2  %           9,971              8.3  %          3,552              4.8  %             (4,480)             (44.9) %              6,419             180.7  %
Total noninterest income   $ 67,277            100.0  %       $ 120,621            100.0  %       $ 73,470            100.0  %       $    (53,344)             (44.2) %       $     47,151              64.2  %


__________________
(1)   Income from interest rate swaps and other derivative transactions with
customers. The Company incurred expenses related to derivative transactions with
customers of $8.1 million, $0.8 million and $0.3 million in 2022, 2021 and 2020,
respectively, which are included in noninterest expenses.
(2)  Changes in cash surrender value of BOLI are not taxable.
(3) The Company sold its Coral Gables headquarters for $135.0 million, with an
approximate carrying value of $69.9 million at the time of sale and transaction
costs of $2.6 million. The Company leased-back the property for an 18-year term.
(4) Includes: (i) net loss on sale of debt securities of $2.4 million in the
2022 and net gains on sale of debt securities of $4.3 million and $26.5 million
in 2021 and 2020, respectively, and (ii) and unrealized losses of $1.3 million
and $0.6 million in 2022 and 2021, respectively and unrealized gains of $0.5
million in 2020 related to the change in fair value of marketable equity
securities not held for trading. In addition, includes realized losses of $42
thousand on the sale of a mutual fund with a fair value of $23.4 million at the
time of the sale in 2021.
(5)   Net unrealized gains and losses related to uncovered interest rate caps
with clients.
(6)  Includes: (i) mortgage banking income of $3.4 million and $1.7 million in
2022 and 2021, respectively, primarily consisting of gain on sale of loans, gain
on loans market valuation, other fees and smaller sources of income; (ii) a gain
of $3.8 million on the sale of PPP loans in 2021, and (iii) a loss of $1.7
million on the sale of the Beacon Operations Center in 2020. Other sources of
income in the periods shown include income from foreign currency exchange
transactions with customers and valuation income on the investment balances held
in the non-qualified deferred compensation plan.
(7)  Beginning in 2022, rental income associated with the subleasing of portions
of the Company's headquarters building is presented as a reduction to rent
expense under lease agreements under occupancy and equipment cost (included as
part of other noninterest income in 2021 in connection with the previously-owned
headquarters building). In addition, in 2022, we had additional rental income in
connection with the sublease of the NYC office space. Total rental income from
subleases was $3.3 million, $2.9 million and $3.0 million, in 2022, 2021 and
2020, respectively.
N/M Means not meaningful

2022 compared to 2021

Total noninterest income decreased $53.3 million, or 44.2%, in 2022 compared to
2021. These results were mainly due to: (i) the absence of a gain of $62.4
million on the sale of the Company's headquarters building in 2021 further
described below; (ii) lower net gains on securities of $7.4 million, primarily
due to lower gains on sale of debt securities available for sale and a loss of
$2.5 million on the sale of corporate securities, mainly private-label
commercial mortgage-backed securities; (iii) lower other noninterest income, and
(iv) lower total brokerage, advisory and fiduciary activities. These results
were partially offset by: (i) higher net gains on the early extinguishment of
FHLB advances; (ii) higher loan-level derivative income; (iii) higher deposit
and service fees; (iv) net unrealized gains on derivative valuation of $0.5
million in 2022 related to interest rate caps with clients, and (v) higher cards
and trade finance servicing fees.

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In 2022, the Company recorded total net gains of $10.7 million on the early extinguishment of approximately $705 million of FHLB advances. In 2021, the Company recorded a loss of $2.5 million on the early extinguishment of approximately $235 million of FHLB advances.



Other noninterest income decreased $4.5 million, or 44.9%, in 2022 compared to
2021, mainly due to the absence of a gain of $3.8 million on the sale of $95.1
million of PPP loans in 2021. This was partially offset by: (i) an increase in
mortgage banking income of $1.7 million in 2022 compared to 2021, and (ii)
higher income from foreign currency exchange transactions with customers.
Beginning in 2022, rental income associated with the subleasing of portions of
the Company's headquarters building is presented as a reduction to rent expense
under lease agreements under occupancy and equipment cost (included as part of
other noninterest income in 2021 in connection with the previously-owned
headquarters building). Rental income from this source was $2.9 million in each
2022 and 2021. In addition, 2022 includes additional rental income of
$0.4 million associated with the sublease of NY office space.

Brokerage, advisory and fiduciary activity fees decreased $0.9 million, or 4.9%, in 2022 compared to 2021, mainly driven by a decrease in advisory fees as a result of lower market valuations of AUM in our client's advisory accounts.



Our AUM totaled $2.0 billion at December 31, 2022, a decrease of $225.4 million,
or 10.1%, from $2.22 billion at December 31, 2021, primarily driven by lower
market valuations, due to decreased valuations in equity and fixed income
markets.

Loan-level derivative income increased $6.4 million, or 162.2%, in 2022 compared
to 2021, mainly driven by a higher volume of interest rate swap transactions
with clients.

Deposits and service fees increased $1.4 million, or 8.0%, in 2022 compared to
2021, mainly driven by higher service charge fee income and higher wire transfer
fees from increased activity.

Cards and trade finance servicing fees increased $0.5 million, or 28.5%, in 2022 compared to 2021, mainly driven by higher debit cards interchange fee income.

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Noninterest Expense

The table below presents a comparison for each of the categories of noninterest expense for the periods presented.


                                                                      Years Ended December 31,                                                                              Change
(in thousands, except                       2022                                2021                                2020                              2022 vs 2021                           2021 vs 2020
percentages)                       Amount              %               Amount              %               Amount              %                Amount                %                Amount                %
Salaries and employee benefits
(1)                             $ 123,510             51.2  %       $ 117,585             59.3  %       $ 111,469             62.4  %       $      5,925              5.0  %       $      6,116              5.5  %
Occupancy and equipment (2)(3)     27,393             11.3  %          20,364             10.3  %          17,624              9.9  %              7,029             34.5  %              2,740             15.5  %
Professional and other services
fees (4)                           22,142              9.2  %          19,096              9.6  %          13,129              7.3  %              3,046             16.0  %              5,967             45.4  %
Telecommunications and data
processing                         14,735              6.1  %          14,949              7.5  %          12,931              7.2  %               (214)            (1.4) %              2,018             15.6  %
Loan-level derivative
expense(5)                          8,146              3.4  %             815              0.4  %             330              0.2  %              7,331            899.5  %                485            147.0  %
Depreciation and
amortization(6)                     5,883              2.4  %           7,269              3.7  %           9,385              5.3  %             (1,386)           (19.1) %             (2,116)           (22.5) %
FDIC assessments and insurance      6,598              2.7  %           6,423              3.2  %           6,141              3.4  %                175              2.7  %                282              4.6  %
Loans held for sale valuation
expense (7)                           159              0.1  %               -                -  %               -                -  %                159                 N/M                  -                -  %
Other real estate owned
valuation expense (8)               3,408              1.4  %               -                -  %               -                -  %              3,408                 N/M                  -                -  %
Contract termination costs (9)      7,103              2.9  %               -                -  %               -                -  %              7,103                 N/M                  -                -  %
Advertising expenses               11,620              4.8  %           3,382              1.7  %           1,600              0.9  %              8,238            243.6  %              1,782            111.4  %
Other operating expenses (10)      10,716              4.5  %           8,359              4.3  %           6,127              3.4  %              2,357             28.2  %              2,232             36.4  %
Total noninterest expenses (11) $ 241,413            100.0  %       $ 198,242            100.0  %       $ 178,736            100.0  %       $     43,171             21.8  %       $     19,506             10.9  %


____________
(1)  Include severance expense of $3.0 million, $3.6 million and $6.4 million in
2022, 2021 and 2020, respectively. Severance expenses in 2022 were primarily
related to the elimination of certain support functions due to the restructuring
of business lines, as well severance expenses in connection with changes in
certain positions. Severance expenses in 2021 were mainly in connection with the
departure of the Company's COO, the elimination of various support function
positions, and other actions. In 2020, severance expenses were primarily in
connection with a voluntary early retirement plan for certain eligible long-term
employees ( the "2020 Voluntary Plan") and an involuntary severance plan for
certain other positions (the "2020 Involuntary Plan"). See Note 1 to our audited
annual consolidated financial statements in this Form 10-K for more details on
the 2020 Voluntary Plan and the 2020 Involuntary Plan.
(2)  In 2022 and 2021, includes ROU asset impairment charges of $1.6 million and
$0.8 million, respectively, in connection with the closure of a branch in
Pembroke Pines, Florida in 2022, and the close of our NY loan production office
in 2021. In addition, in 2022 and 2021, includes lease termination expenses
associated with the closure of a branch in Fort Lauderdale, Florida in 2021.
(3) Beginning in the three months ended March 31, 2022, rental income associated
with the subleasing of portions of the Company's headquarters building is
presented as a reduction to rent expense under lease agreements under occupancy
and equipment cost (included as part of other noninterest income in 2021 in
connection with the previously-owned headquarters building). In addition, in
2022, we had additional rental income in connection with the sublease of the NYC
office space. Total rental income from subleases was $3.3 million, $2.9 million
and $3.0 million, in 2022, 2021 and 2020, respectively.
(4) In 2022, includes additional expenses of $3.6 million, including: (i) $2.9
million resulting from the Company's transition to our new technology provider;
(ii) $0.2 million in connection with certain search and recruitment expenses;
(iii) $0.1 million of costs associated with the subleasing of the New York
office space, and (iv) an aggregate of $0.4 million in other non-routine
expenses. In 2021, includes additional expenses of $1.5 million, including: (i)
$0.8 million of expenses in connection with the merger and related transactions,
and (ii) $0.7 million resulting from the Company's transition to our new
technology provider.
(5) Includes service fees in connection with our loan-level derivative income
generation activities.
(6) In 2021 and 2020, includes $1.8 million and $2.1 million, respectively, of
depreciation expense associated with the Company's previously owned headquarters
building. No depreciation expense related to the headquarters building was
recorded in 2022 as this property was sold and leased-back in the fourth quarter
of 2021.
(7)  Valuation allowance as a result of changes in the fair value of loans held
for sale carried at the lower of cost or fair value.
(8)  Fair value adjustment related to one OREO property in New York.
(9)  Estimated contract terminations and related costs associated with third
party vendors resulting from the Company's transition to our new technology
provider.
(10)  Includes charitable contributions, community engagement, postage and
courier expenses, provisions for estimated credit losses on contingent loans,
and debits which mirror the valuation income on the investment balances held in
the non-qualified deferred compensation plan in order to adjust our liability to
participants of the deferred compensation plan.
(11)  Includes $12.5 million and $7.1 million in 2022 and 2021, respectively,
related to mortgage banking activities, primarily consisting of salaries and
employee benefits, mortgage lending costs and professional and other services
fees.
NM Means not meaningful
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2022 compared to 2021



Noninterest expense increased $43.2 million, or 21.8%, in 2022 compared to 2021,
mainly driven by advertising expenses, loan-level derivative expenses, occupancy
and equipment costs, salaries and employee benefits, professional and other
services fees and other operating expenses. Also, in 2022, the Company incurred
additional expenses, including: (i) $7.1 million of estimated contract
termination costs associated with third party vendors resulting from the
Company's transition to our new technology provider; (ii) a non-routine charge
of $3.4 million resulting from changes in the estimated fair value and related
disposition costs of one OREO property in New York, and (iii) a valuation
allowance of $0.2 million related to the change in fair value of New York loans
held for sale. These increases were partially offset by lower depreciation and
amortization expenses.

Advertising expenses increased $8.2 million, or 243.6%, in 2022 compared to
2021, mainly as a result of the Company's efforts to build brand awareness as
well as account opening campaigns and different market efforts to drive or
increase digital and branch traffic. These impactful campaigns include
out-of-home advertising and various campaigns via social media and public
relations. In addition, in July 2022, we entered into a new multi-year agreement
to become the official bank of the NBA's Miami Heat and we also entered into a
new multi-year agreement as a proud partner of the NHL's Florida Panthers (the
"Florida Panthers"). Also, in November 2022, the Company expanded its
partnership with the Florida Panthers by entering into a multi-year agreement to
become the official bank of the sport team. Furthermore, we continue to leverage
other local partnerships with the University of Miami Athletics, United Way and
Habitat for Humanity.

Loan-level derivative expense increased $7.3 million, or 899.5%, in 2022 compared to 2021, mainly driven by a higher volume of interest rate swap transactions with clients.



Occupancy and equipment expenses increased $7.0 million, or 34.5%, in 2022
compared to 2021, mainly driven by additional rent expense of $10.1 million
associated with the previously-owned headquarters building, as this property was
sold and leased-back in the fourth quarter of 2021. In addition, in 2022, the
Company recorded a lease impairment charge of $1.6 million related to the
closure of a branch, in Pembroke Pines, Florida. These increases were partially
offset by the absence of a lease impairment of $0.8 million in 2021 in
connection with the closing of the New York LPO. Additionally, beginning in the
three months ended March 31, 2022, rental income associated with the subleasing
of portions of the Company's headquarters building is presented as a reduction
to rent expense under lease agreements under occupancy and equipment cost
(included as part of other noninterest income in 2021 in connection with the
previously-owned headquarters building). Rental income from this source was
$2.9 million in each 2022 and 2021. In addition, 2022 includes additional rental
income of $0.4 million associated with the sublease of NY office space.

Salaries and employment benefits increased $5.9 million, or 5.0%, in 2022
compared to 2021, mainly due to: (i) higher non-equity variable compensation;
(ii) higher equity variable compensation in connection with the long term
incentive program; (iii) commissions paid primarily related to loan origination
efforts in the mortgage banking area, and (iv) additional compensation expenses
in connection with a new employee stock repurchase plan launched in 2022. These
results were partially offset by: (i) lower severance expenses, and (ii)
decreases in salaries and employee benefits related to staff reductions
resulting from our ongoing transformation and efficiency improvement efforts. At
December 31, 2022, our FTEs were 692, a net decrease of 71 FTEs, or 9.3%
compared to 763 FTEs at December 31, 2021. In the second quarter of 2022, the
company rebalanced its workforce in the mortgage banking business in light of
current market conditions. In addition, as a result of the Company's agreement
with our new technology provider there were 80 FTEs who were moved to FIS® at
the beginning of 2022, reducing the Company's total FTEs to 683 effective
January 1, 2022.

Professional and other services fees increased $3.0 million, or 16.0%, in 2022
compared to 2021, mainly driven by: (i) an increase of $2.2 million in
consulting fees resulting from the Company's transition to our new technology
provider; (ii) higher expenses related to the onboarding of a new firm as a
result of the outsourcing of the Company's internal audit function late in the
third quarter of 2021; (iii) higher search and recruitment expenses, and (iv)
higher accounting fees in connection with the CECL adoption in 2022.

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Other operating expenses increased $2.4 million, or 28.2%, in 2022 compared to
2021. This includes increases in indirect loan costs, contributions and
donations, public relations expenses, OREO real estate taxes, other smaller
expenses. In addition, in 2022 the Company had no provision or reversals for
estimated expected credit losses on contingent loans, compared to a reversal of
$0.3 million in 2021.

Depreciation and amortization expense decreased $1.4 million, or 19.1%, in 2022
compared to 2021.This was mainly due to the absence of depreciation expense
related to the Company's previously-owned headquarters building, as this
property was sold and leased-back in the fourth quarter of 2021. In 2021, the
Company recorded $1.8 million of depreciation expense associated with the
headquarters building.

In 2022 and 2021, there were expenses in connection with our mortgage banking
operation of $12.5 million and $7.1 million, respectively. These expenses
included: (i) $8.9 million and $5.5 million in 2022 and 2021, respectively,
related to salaries and employee benefits expenses, and (ii) $3.6 million and
$1.6 million in 2022 and 2021, respectively, related to mortgage lending costs,
professional fees and other noninterest expenses. We commenced our mortgage
banking operation in May 2021.


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Income Taxes



The table below sets forth information related to our income taxes for the
periods presented.

(in thousands, except                   Years Ended December 31,                                                     Change
percentages)                   2022               2021              2020                     2022 vs 2021                             2021 vs 2020
Income (loss) before income
tax expense (benefit)       $ 78,584          $ 144,020          $ (4,334)            (65,436)              (45.4) %       $  148,354                       NM
Current tax expense:
Federal                       15,609             23,225             7,401              (7,616)              (32.8) %           15,824                 213.8  %
State                          1,116              4,681             2,163              (3,565)              (76.2) %            2,518                 116.4  %
                              16,725             27,906             9,564             (11,181)              (40.1) %           18,342                 191.8  %

Deferred tax expense
(benefit)                       (104)             5,803           (12,176)             (5,907)             (101.8) %           17,979                (147.7) %
Income tax expense
(benefit)                   $ 16,621          $  33,709          $ (2,612)         $  (17,088)              (50.7) %       $   36,321                       NM
Effective income tax rate      21.15  %           23.41  %          60.27  %            (2.26) %             (9.7) %           (36.86) %              (61.2) %


______________

NM - means not meaningful

2022 compared to 2021



We recorded an income tax expense of $16.6 million in 2022 compared to $33.7
million in 2021. The decrease in income tax expense in 2022 was mainly driven by
lower income before income taxes in 2022 compared to 2021, as prior year
included a $62.4 million gain on sale of the Company's headquarters building in
2021.In addition, there was a lower effective income tax rate in 2022 compared
to the prior year, primarily due to lower state income tax and the rate
differential on deferred items.

As of December 31, 2022, the Company's net deferred tax asset was $48.7 million,
an increase of $37.4 million, or 331.0% compared to $11.3 million as
of December 31, 2021. This increase is primarily due to the tax effect of: (i)
$32.4 million increase in connection with $127.7 million in net unrealized
holding losses on debt securities available for sale in 2022, and (ii) $4.8
million increase in connection with the adoption of the CECL accounting standard
in 2022.
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                          Non-GAAP Financial Measures

The Company supplements its financial results that are determined in accordance
with GAAP with non-GAAP financial measures, such as "pre-provision net revenue
(PPNR)", "core pre-provision net revenue (Core PPNR),"and "tangible
stockholders' equity book value per common share". This supplemental information
is not required by or is not presented in accordance with GAAP. The Company
refers to these financial measures and ratios as "non-GAAP financial measures"
and they should not be considered in isolation or as a substitute for the GAAP
measures presented herein.

We use certain non-GAAP financial measures, including those mentioned above,
both to explain our results to shareholders and the investment community and in
the internal evaluation and management of our businesses. Our management
believes that these non-GAAP financial measures and the information they provide
are useful to investors since these measures permit investors to view our
performance using the same tools that our management uses to evaluate our past
performance and prospects for future performance, especially in light of the
Company's adoption of CECL in the year ended December 31, 2022, as well as the
additional costs we have incurred in connection with the Company's restructuring
activities that began in 2018 and continued in 2022, including the effect of
non-core banking activities such as the sale of loans and securities, the
valuation of securities, derivatives, loans held for sale and other real estate
owned, the sale of our corporate headquarters in the fourth quarter of 2021, and
other non-routine actions intended to improve customer service and operating
performance. While we believe that these non-GAAP financial measures are useful
in evaluating our performance, this information should be considered as
supplemental and not as a substitute for or superior to the related financial
information prepared in accordance with GAAP. Additionally, these non-GAAP
financial measures may differ from similar measures presented by other
companies.
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The following table is a reconciliation of the Company's PPNR and Core PPNR, non GAAP financial measures, as of the dates presented:



                                                                      December 31,
(in thousands)                                                    2022           2021

Net income attributable to Amerant Bancorp Inc.                $  63,310      $ 112,921
Plus: provision for (reversal of) credit losses (1)               13,945

(16,500)


Plus: provision for income tax expense (2)                        16,621

33,709


Pre-provision net revenue (PPNR)                               $  93,876      $ 130,130
Plus: non-routine noninterest expense items                       18,970

7,057


Less: non-routine noninterest income items                        (7,367)

(67,280)


Core pre-provision net revenue (Core PPNR)                     $ 105,479

$ 69,907



Non-routine noninterest income items:
Gain on sale of Headquarters building (2)                              -         62,387
Derivative gains, net                                                455              -
Securities (loss) gains, net                                      (3,689)         3,740

Gain (loss) on early extinguishment of FHLB advances, net 10,678

(2,488)


(Loss) gain on sale of loans                                         (77)

3,641


Total non-routine noninterest income items                     $   7,367

$ 67,280



Non-routine noninterest expense items
Restructuring costs (3)
Staff reduction costs (4)                                          3,018

3,604


Contract termination costs (5)                                     7,103


Legal and Consulting fees (6)                                      3,625

1,689


Digital transformation expenses                                       45            412
Lease impairment charge (7)                                        1,579            810
Branch closure expenses (8)                                           33            542
Total restructuring costs                                      $  15,403      $   7,057
Other non-routine noninterest expense items:
Other real estate owned valuation expense (9)                      3,408


Loans held for sale valuation (reversal) expense (10)                159


Total non-routine noninterest expense items                    $  18,970

$ 7,057




(1)   The Company adopted CECL on January 1, 2022. See Note 1 to our audited
annual consolidated financial statements in this Form 10-K for details on the
adoption of the new accounting standard on estimating expected credit losses on
financial instruments (CECL).
(2)  The Company sold its Coral Gables headquarters for $135 million, with an
approximate carrying value of $69.9 million at the time of sale and transaction
costs of $2.6 million. The Company leased-back the property for an 18-year term.
The provision for income tax expense includes approximately $16.1 million
related to this transaction in the year ended December 31, 2021.
(3) Expenses incurred for actions designed to implement the Company's strategy.
These actions include, but are not limited to, reductions in workforce,
streamlining operational processes, rolling out the Amerant brand,
implementation of new technology system applications, enhanced sales tools and
training, expanded product offerings and improved customer analytics to identify
opportunities.
(4)  In 2022, includes expenses primarily in connection with changes in certain
positions within our business units, restructuring of business lines and the
outsourcing of certain support functions. In 2021, includes expenses in
connection with the departure of the Company's Chief Operating Officer and the
elimination of various other support function positions, including the NYC LPO.
(5)   Contract termination and related costs associated with third party vendors
resulting from the Company's engagement of FIS.
(6)  In the year ended December 31, 2022, includes: (i) $2.9 million in
connection with the engagement of FIS; (ii) $0.2 million in connection with
certain search and recruitment expenses; (iii) $0.1 million of costs associated
with the subleasing of the New York office space, and (iv) an aggregate of $0.4
million in other expenses. In the year ended December 31, 2021, includes: (i)
expenses in connection with the engagement of FIS of $0.7 million, and (ii)
expenses in connection with the Merger and related transactions of $0.8 million.
(7)  In the year ended December 31, 2022 and 2021, includes $1.6 million and
$0.8 million, respectively, of ROU asset impairment associated with the closure
of a banking center in Pembroke Pines, Florida in 2022, and in connection with
the closure of the NYC loan production office in 2021.
(8)  Expenses related to the banking center lease termination in Wellington,
Florida in 2022, the lease termination of the Fort Lauderdale banking center in
2021.
(9)  Fair value adjustment related to one OREO property in New York.
(10)  Fair value adjustment related to the New York loan portfolio held for sale
carried at the lower of cost or fair value.

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The following table is a reconciliation of the Company's tangible common equity and tangible assets, non GAAP financial measures, to total equity and total assets, respectively, as of the dates presented:



(in thousands, except percentages and per share
amounts)                                             December 31, 2022           December 31, 2021

Stockholders' equity                                $         705,726          $          831,873
Less: goodwill and other intangibles (1)                      (23,161)                    (22,528)
Tangible common stockholders' equity                $         682,565          $          809,345
Total assets                                                9,127,804                   7,638,399
Less: goodwill and other intangibles (1)                      (23,161)                    (22,528)
Tangible assets                                     $       9,104,643          $        7,615,871
Common shares outstanding                                  33,815,161                  35,883,320
Tangible common equity ratio                                     7.50  %                    10.63  %
Stockholders' book value per common share           $           20.87          $            23.18
Tangible stockholders' book value per common share  $           20.19          $            22.55



(1)   Other intangible assets primarily consist of mortgage servicing rights
("MSRs") of $1.3 million and $0.6 million at December 31, 2022 and 2021,
respectively, and are included in other assets in the Company's consolidated
balance sheets.

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Financial Condition - Comparison of Financial Condition as of December 31, 2022 and December 31, 2021




Assets. Total assets were $9.1 billion as of December 31, 2022, an increase of
$1.5 billion, or 19.5%, compared to $7.6 billion at December 31, 2021. This
result was primarily driven by increases of: (i) $1.3 billion, or 24.3% in total
loans held for investment, net of the allowance for credit losses, and loans
held for sale; (ii) $123.9 million, or 104.9% in debt securities held to
maturity, and (iii) $63.5 million, or 68.7%, in other assets. These increases
were partially offset by a decrease of $117.7 million, or 10.0% in debt
securities available for sale. See "-Average Balance Sheet, Interest and
Yield/Rate Analysis" for detailed information, including changes in the
composition of our interest-earning assets.

Other assets were $156.0 million as of December 31, 2022, an increase of $63.5
million, or 68.7%, compared to $92.5 million at December 31, 2021, primarily
driven by changes in the estimated fair value of derivative instruments as a
result of changes in market interest rates during the period. See Note 12 to our
audited annual consolidated financial statements in this Form 10-K for more
details on derivative instruments.

Total assets were $7.6 billion as of December 31, 2021, a decline of $132.5
million, or 1.7%, compared to $7.8 billion at December 31, 2020. The decrease in
total assets in 2021 compared to 2020 includes $233.8 million, or 4.1% in lower
total loans, including loans held for sale, and net of the allowance for loan
losses. This decrease in total loans was partially offset by: (i) an increase of
$59.8 million, or 27.9% in cash and cash equivalents, and (ii) an increase of
$(1.3) million, or (1.4)% in other assets mainly driven by the adoption of the
new accounting guidance on leases. See "-Average Balance Sheet, Interest and
Yield/Rate Analysis" for detailed information, including changes in the
composition of our interest-earning assets, and Note 1 to our consolidated
audited financial statements in this Form 10-K for more details on the new
guidance on leases.


Cash and Cash Equivalents

2022 compared to 2021

Cash and cash equivalents totaled $290.6 million at December 31, 2022, an
increase of $16.4 million, or 6.0%, from $274.2 million at December 31, 2021.
This was primarily due to new restricted cash balances in 2022. At December 31,
2022, the Company's cash and cash equivalents included restricted cash of $42.2
million, which was held primarily to cover margin calls on derivative
transactions with certain brokers. These balances primarily increased due to
cash collateral held in response to the change in fair value of derivative
instruments. There were no restricted cash balances at December 31, 2021.

Cash flows used in operating activities was $49.2 million in the year ended
December 31, 2022, primarily driven by higher volume of originations of mortgage
loans held for sale during the period. This was partially by: (i) higher volume
of sales of mortgage loans held for sale during the period, and (ii) the net
income before attribution of non-controlling interest of $62.0 million in 2022.

Net cash used in investing activities was $1.4 billion during the year ended
December 31, 2022, mainly driven by: (i) a net increase in loans of $1.3
billion, and (ii) purchases of investment securities totaling $457.4 million.
These disbursements were partially offset by: (i) maturities, sales, calls and
paydowns of investment securities totaling $292.0 million, and (ii) proceeds
from loan sales of $84.0 million.




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In the year ended December 31, 2022, net cash provided by financing activities
was $1.5 billion. These activities included: (i) a net increase of $1.0 billion
in total demand, savings and money market deposit balances; (ii) a net increase
of $390.4 million in time deposits; (iii) net proceeds from FHLB advances of
$105.7 million, and (iv) net proceeds from the issuance of subordinated notes of
$29.1 million. These proceeds were partially offset by: (i) an aggregate $72.1
million in connection with the repurchase of shares of Class A common stock
under stock repurchase programs launched in 2021 and in 2022, and (ii) $12.2
million of dividends declared and paid by the Company in 2022. See "-Capital
Resources and Liquidity Management" for more details on changes in FHLB
advances, issuance of subordinated notes and the stock repurchase programs
launched in 2021 and 2022.


Loans

Loans are our largest component of interest-earning assets. The table below
depicts the trend of loans as a percentage of total assets and the allowance for
loan losses as a percentage of total loans held for investment for the periods
presented.

                                                                             December 31,
(in thousands, except percentages)                          2022                 2021                 2020

Total loans, gross (1)                                 $    6,919,632       $    5,567,540       $    5,842,337
Total loans, gross (1) / Total assets                         75.8  %              72.9  %              75.2  %

Allowance for credit losses (2)                        $    83,500

$ 69,899 $ 110,902 Allowance for credit losses / Total loans held for investment, gross (1) (2)

                                     1.22  %              1.29  %              1.90  %

Total loans, net (3)                                   $ 6,836,132          $ 5,497,641          $ 5,731,435
Total loans, net (3) / Total assets                           74.9  %              72.0  %              73.8  %


_______________

(1)  Total loans, gross is the principal balance of outstanding loans, including
loans held for investment and loans held for sale, net of unamortized deferred
nonrefundable loan origination fees and loan origination costs, and unamortized
premiums paid on purchased loans, excluding the allowance credit loan losses. At
December 31, 2021, the Company had $143.2 million in loans held for sale carried
at the lower of cost or estimated fair value. In the third quarter of 2022,
these loans held for sale were transferred to the loans held for investment
category, therefore, there were no loans held for sale carried at the lower of
cost or estimated fair value at December 31, 2022. In addition, at December 31,
2022 and 2021, there were $62.4 million and $14.9 million, respectively, in
loans held for sale carried at fair value in connection with the Company's
mortgage banking activities through its subsidiary Amerant Mortgage.
(2)  In 2022, the Company adopted a new accounting standard on estimating
expected credit losses, or CECL. In 2022, the Company recorded an increase to
its ACL of $18.7 million as of January 1, 2022, with a corresponding after-tax
cumulative effect adjustment to retained earnings of $13.9 million. See Note 1
to our audited consolidated financial statements on this Form 10-K for more
details on the adoption of this new accounting standard..
(3)  Total loans, net is the principal balance of outstanding loans, including
loans held for investment and held for sale, net of unamortized deferred
nonrefundable loan origination fees and loan origination costs, and unamortized
premiums paid on purchased loans, excluding the allowance for credit losses.






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The table below summarizes the composition of loans held for investment by type
of loan as of the end of each period presented. International loans include
transactions in which the debtor or customer is domiciled outside the U.S., even
when the collateral is U.S. property. All international loans are denominated
and payable in U.S. Dollars.

                                                                                 December 31,
(in thousands)                             2022                 2021                 2020                 2019                 2018

Domestic Loans:
Real estate loans
Commercial real estate (CRE)
Nonowner occupied                     $ 1,615,716          $ 1,540,590

$ 1,749,839 $ 1,891,802 $ 1,809,356 Multi-family residential

                  820,023              514,679              737,696              801,626              909,439
Land development and construction
loans                                     273,174              327,246              349,800              278,688              326,644
                                        2,708,913            2,382,515            2,837,335            2,972,116            3,045,439
Single-family residential (1)           1,048,396              586,783              543,076              427,431              398,043
Owner occupied                          1,046,450              962,538              947,127              894,060              777,022
                                        4,803,759            3,931,836            4,327,538            4,293,607            4,220,504
Commercial loans (2)                    1,338,157              942,781            1,103,501            1,190,193            1,306,792
Loans to depository institutions and
acceptances (3)                            13,292               13,710               16,629               16,547               19,965
Consumer loans and overdrafts
(4)(5)(6)                                 602,793              421,471              241,771               72,555               73,155
Total Domestic Loans                    6,758,001            5,309,798            5,689,439            5,572,902            5,620,416

International Loans:
Real estate loans
Single-family residential (7)              54,449               74,556               96,493              111,671              135,438

Commercial loans                           43,077               22,892               51,049               43,850               73,636
Loans to depository institutions and
acceptances                                     -                    -                    7                    5               49,000
Consumer loans and overdrafts (8)           1,667                2,194                5,349               15,911               41,685
Total International Loans                  99,193               99,642              152,898              171,437              299,759

Total Loans Held For Investment $ 6,857,194 $ 5,409,440

    $ 5,842,337          $ 5,744,339          $ 5,920,175


__________________

(1)   As of December 31, 2022 and 2021, includes approximately $230.3 million
and $23.9 million, respectively, in single-family residential loans purchased by
the Company through Amerant Mortgage.
(2)   As of December 31, 2022, includes approximately $45.3 million in
commercial loans and leases originated under a white-label equipment financing
solution launched in the second quarter of 2022.
(3)   Mostly comprised of loans secured by cash or U.S. Government securities.
(4)  Includes customers' overdraft balances totaling $4.7 million, $0.6 million,
$0.7 million, $1.3 million and $1.0 million at each of the dates presented.
(5)  Includes indirect consumer lending loans purchased with an outstanding
balance of $433.3 million and $297.0 million as of December 31, 2022 and 2021,
respectively, net of unamortized premium paid of $10.9 million and $9.1 million
as of December 31, 2022 and 2021, respectively. There were no indirect consumer
lending loans at any of the other periods shown. In addition, as of December 31,
2022, includes $43.8 million in consumer loans originated under a white-label
program launched in the third quarter of 2022.
(6)  There were no outstanding credit card balances as of December 31, 2022,
2021 and 2020. At December 31, 2019, 2018, balances are mostly comprised of
credit card extensions of credit to customers with deposits with the Bank. The
Company phased out its legacy credit card products in the first quarter of 2020
to further strengthen its credit quality.
(7)  Secured by real estate properties located in the U.S.
(8)   International customers' overdraft balances were de minimis at each of the
dates presented.

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The composition of our CRE loan portfolio held for investment by industry
segment at December 31, 2022, 2021 and 2020 is depicted in the following table:

                                                                                     December 31,
(in thousands)                                 2022                 2021                 2020                 2019                 2018
Retail (1)                                $   731,229          $   751,202          $ 1,062,119          $ 1,143,565          $ 1,081,143
Multifamily                                   820,023              514,679              737,696              801,626              909,439
Office space                                  342,248              361,921              390,295              453,328              441,712
Specialty(2)                                   84,791               86,130               35,210                    -                    -
Land and construction                         273,174              327,246              349,800              278,688              326,644
Hospitality                                   324,881              241,336              191,750              198,807              166,415
Industrial and warehouse                      132,567              100,001               70,465               96,102              120,086

Total CRE Loans Held For Investment (3) $ 2,708,913 $ 2,382,515

$ 2,837,335 $ 2,972,116 $ 3,045,439

_______________


(1)  Includes loans generally granted to finance the acquisition or operation of
non-owner occupied properties such as retail shopping centers, free-standing
single-tenant properties, and mixed-use properties primarily dedicated to
retail, where the primary source of repayment is derived from the rental income
generated from the use of the property by its tenants. As of December 31, 2021
and 2020, these balances were revised to exclude the Specialty industry segment
which is now disclosed separately.
(2)  Includes marinas, nursing and residential care facilities, and other
specialty type CRE properties. There were no loans in the Specialty industry
segment as of December 31, 2019 and 2018.
(3)  Includes loans held for investment in the NY loan portfolio, which were
$330 million at December 31, 2022 and $346.3 million at December 31, 2021. In
2022, the Company reclassified all loans in the NY loans portfolio previously
classified as loans held for sale at the lower of cost or fair value, to loans
held for investment.

The table below summarizes the composition of our loans held for sale by type of loan as of the end of each period presented



                                  December 31,           December 31,          December 31,           December 31,          December 31,
(in thousands)                        2022                   2021                  2020                   2019                  2018
Loans held for sale at the
lower of fair value or cost
Real estate loans
Commercial real estate
Non-owner occupied              $           -          $     110,271          $          -          $           -          $          -
Multi-family residential                    -                 31,606                     -                      -                     -

                                            -                141,877                     -                      -                     -

Owner occupied                              -                  1,318                     -                      -                     -

Total loans held for sale at
the lower of fair value or cost             -                143,195                     -                      -                     -
Loans held for sale at fair
value (1)
Land development and
construction loans                      9,424                      -                     -                      -                     -
Single family residential              53,014                 14,905                     -                      -                     -
Total loans held for sale at
fair value                             62,438                 14,905                     -                      -                     -
  Total loans held for sale (2) $      62,438          $     158,100          $          -          $           -          $          -


______________

(1)Loans held for sale in connection with the Company's mortgage banking activities through its subsidiary Amerant Mortgage. (2)Remained current and in accrual status as of December 31, 2022 and 2021.

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At December 31, 2022, there were no loans held for sale carried at the lower of
cost or estimated fair value compared to $143.2 million at December 31, 2021. In
the years ended December 31, 2022 and 2021, the Company sold $57.3 million and
$49.4 million, respectively, of these loans at their par value, and collected
approximately $20 million and $46 million in full or partial satisfaction of
these loans, respectively. In the third quarter of 2022, the Company transferred
the remaining balance of these loans held for sale of approximately $66 million
to the loans held for investment portfolio, as we now have the intent and
ability to hold these loans until maturity or repayment. In 2021, in connection
with the closing of our former NYC LPO, the Company elected to market and sell a
portion of the loan portfolio held for investment to shorten duration and
significantly reduce the number of loans being serviced. Therefore, in 2021, the
Company classified certain New York real estate loans as held for sale carried
at the lower of cost or estimated fair value. These loans had been previously
carried at their original amortized cost.

At December 31, 2022, there were no CRE loans carried at the lower of cost or
estimated fair value. As of December 31, 2021, CRE loans held for sale carried
at the lower of cost or estimated fair value include $85.4 million in the retail
segment, $31.6 million in the multifamily segment, and $25.0 million in the
office segment.

At December 31, 2022 and December 31, 2021, there were $62.4 million and $14.9
million, respectively, of primarily single-family residential loans held for
sale carried at their estimated fair value. In 2022, in connection with mortgage
loans held for sale, we originated and purchased approximately $286.7 million,
and had proceeds of approximately $143.1 million, mainly from the sale of these
loans.

As of December 31, 2022, total loans held for investment were $6.9 billion, up
$1.4 billion, or 26.8%, compared to $5.4 billion at December 31, 2021. Domestic
loans held for investment increased $1.4 billion, or 27.3%, as of December 31,
2022, compared to December 31, 2021. The increase in total domestic loans held
for investment includes net increases of $461.6 million, or 78.7%, $395.4
million, or 41.9%, $326.4 million, or 13.7%, $181.3 million, or 43.0%, and $83.9
million, or 8.7%, in domestic single-family residential loans, commercial loans,
CRE loans, consumer loans and owner occupied loans, respectively. The increase
in our domestic loan portfolio held for investment in 2022 includes the effect
of: (i) originations of CRE and single-family residential loans (ii) origination
and cross-sale efforts of commercial loans; (ii) loan purchases of approximately
$385.8 million under indirect consumer lending programs; (iii) approximately
$173.1 million of single-family residential loans purchased by the Company
through its subsidiary Amerant Mortgage; (iv) $47 million of commercial loans
originations through a new white label equipment financing solution launched in
the second quarter of 2022; and (v) originations of consumer loans of
approximately $45 million through a new white-label program launched in the
third quarter of 2022. These results were partially offset by loan prepayments
during the period.

In 2022, the Company added approximately $413.3 million, increased $371.7 million, or 894.5%, compared to $41.6 million in 2021, in single-family residential loans through Amerant Mortgage which includes loans originated and purchased from different channels.



As of December 31, 2022, loans under syndication facilities were $367.0 million,
a decline of $22.0 million, or 5.7%, compared to $389.0 million at December 31,
2021. This was primarily driven by payoffs totaling $118.3 million, including
$54.2 million in connection with two CRE construction loans, and paydowns of $11
million. This was partially offset by an aggregate of $99.2 million in new
loans, including $92.9 million of commercial loans primarily in the specialty
finance industry. As of December 31, 2022, syndicated loans that financed
"highly leveraged transactions", or HLT, were $8.5 million, or 0.1% of total
loans, compared to $17.1 million, or 0.3% of total loans, as of December 31,
2021.


Loans to international customers, primarily from Latin America, declined $0.4
million, or 0.5%, as of December 31, 2022, compared to December 31, 2021. This
was mainly driven by loan payoffs, including $20.1 million in residential loans
from Venezuelan borrowers and $0.5 million in consumer loans. These decreases
were partially offset by a $20.2 million increase in commercial loans.


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The following is a brief description of the composition of our loan classes:

Commercial Real Estate (CRE) loans. We provide a mix of variable and fixed rate
CRE loans. These are loans secured by non-owner occupied real estate properties
and land development and construction loans.

Loans secured by non-owner occupied real estate properties are generally granted
to finance the acquisition or operation of CRE properties. The main source of
repayment of these real estate loans is derived from cash flows or conversion of
productive assets and not from the income generated by the disposition of the
property held as collateral. These mainly include rental apartment (multifamily)
properties, office, retail, warehouses and industrial facilities, and
hospitality (hotels and motels) properties mainly in South Florida, the greater
Houston, Texas area and the greater New York City area, especially the five New
York City boroughs. Concentrations in these non-owner occupied CRE loans are
subject to heightened regulatory scrutiny. See "Risk Factors- Our concentration
of CRE loans could result in further increased loan losses, and adversely affect
our business, earnings, and financial condition."

Land development and construction loans includes loans for land acquisition,
land development, and construction (single or multiple-phase development) of
single residential or commercial buildings, loans to reposition or rehabilitate
commercial properties, and bridge loans mainly in the South Florida, the greater
Houston, Texas area and the greater New York City area, especially the five New
York City boroughs. Typically, construction lines of credit are funded based on
construction progress and generally have a maturity of three years or less.

Owner-occupied. Loans secured by owner-occupied properties are typically working
capital loans made to businesses in the South Florida and the greater Houston,
Texas markets. The source of repayment of these commercial owner-occupied loans
primarily comes from the cash flow generated by the occupying business and the
real estate collateral serves as an additional source of repayment. These loans
are assessed, analyzed, and structured essentially in the same manner as
commercial loans.

Single-Family Residential. These loans include loans to domestic and foreign
individuals primarily secured by their personal residence in the U.S., including
first mortgages on properties mainly located in Florida, home equity and home
improvement loans, mainly in South Florida and the greater Houston, Texas
markets. These loans have terms common in the industry. However, loans to
foreign clients have more conservative underwriting criteria and terms.

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Commercial loans. We provide a mix of variable and fixed rate C&I loans. These
loans are made to a diverse range of business sizes, from the
small-to-medium-sized to middle market and large companies. These businesses
cover a diverse range of economic sectors, including manufacturing, wholesale,
retail, primary products and services. We provide loans and lines of credit for
working capital needs, business expansions and for international trade
financing. These loans include working capital loans, asset-based lending,
participations in Shared National Credit facilities, or SNCs (loans of $100
million or more that are shared by two or more institutions), purchased
receivables and SBA loans, among others. The tenors may be either short term
(one year or less) or long term, and they may be secured, unsecured, or
partially secured. Typically, lines of credit have a maturity of one year or
less, and term loans have maturities of five years or less. In 2020, the Company
began participating in the SBA's PPP, by providing loans to businesses to cover
payroll, rent, mortgage, healthcare, and utilities costs, among other essential
expenses. In early January 2021, a third round of PPP loans provided additional
stimulus relief to small businesses and individuals who were self-employed or
independent contractors. In addition, the Company originates equipment loan and
leases through a white-label equipment financing solution launched in the second
quarter of 2022.

Commercial loans to borrowers in similar businesses or products with similar
characteristics or specific credit requirements are generally evaluated under a
standardized commercial credit program. Commercial loans outside the scope of
those programs are evaluated on a case-by-case basis, with consideration of any
exposure under an existing commercial credit program. The Bank maintains several
commercial credit programs designed to standardize underwriting guidelines, and
risk acceptance criteria, in order to streamline the granting of credits to
businesses with similar characteristics and common needs. Some programs also
allow loans that deviate from credit policy underwriting requirements and
allocate maximum exposure buckets to those loans. Loans originated through a
program are monitored regularly for performance over time and to address any
necessary modifications.

Loans to financial institutions and acceptances. These loans primarily include
trade financing facilities through letters of credits, bankers' acceptances, pre
and post-export financing, and working capital loans, among others. These loans
are generally granted for terms not exceeding one year. Since 2019, we have
substantially reduced this activity.

Consumer loans and overdrafts. These loans include open and closed-end loans
extended to domestic and foreign individuals for household, family and other
personal expenditures. These loans include automobile loans, personal loans, or
loans secured by cash or securities and revolving credit card agreements. These
loans have terms common in the industry for these types of loans, except that
loans to foreign clients have more conservative underwriting criteria and terms.
Beginning in 2020, consumer loans include indirect unsecured personal loans to
well qualified individuals we purchase from recognized third parties personal
loan originators. All consumer loans are denominated and payable in U.S.
Dollars. In 2020, we wound down our credit card program to further strengthen
the Company's credit quality and, as a result, there are no credit card
receivables outstanding after December 31, 2019.


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The tables below set forth the unpaid principal balance of loans held for investment by type, by interest rate type (fixed-rate and variable-rate) and by original contractual loan maturities as of December 31, 2022:



                                                    Due in              Due after            Due after
                                                   one year             one year                five
(in thousands)                                     or less            through five           years (1)              Total

Fixed-Rate
Real estate loans
Commercial real estate (CRE)
Nonowner occupied                               $    99,843          $    615,444          $    92,441          $   807,728
Multi-family residential                             27,384               198,663               28,750              254,797
Land development and construction loans                   -                 4,350                    -                4,350
                                                    127,227               818,457              121,191            1,066,875
Single-family residential                           514,591                78,065              112,348              705,004
Owner occupied                                       24,270               164,702              341,483              530,455
                                                    666,088             1,061,224              575,022            2,302,334
Commercial loans                                    176,642               198,409              123,209              498,260
Loans to financial institutions and acceptances           -                     -                    -                    -
Consumer loans and overdrafts                        46,080                26,916              415,236              488,232
                                                $   888,810          $  1,286,549          $ 1,113,467          $ 3,288,826
Variable-Rate
Real estate loans
Commercial real estate (CRE)
Nonowner occupied                               $   112,842          $    408,560          $   286,586          $   807,988
Multi-family residential                             33,263               401,915              130,048              565,226
Land development and construction loans             100,029               165,426                3,369              268,824
                                                    246,134               975,901              420,003            1,642,038
Single-family residential                            10,793                87,161              299,887              397,841
Owner occupied                                       44,706               182,452              288,837              515,995
                                                    301,633             1,245,514            1,008,727            2,555,874
Commercial loans                                    452,757               363,082               67,135              882,974
Loans to financial institutions and acceptances           -                13,292                    -               13,292
Consumer loans and overdrafts                       116,228                     -                    -              116,228
                                                $   870,618          $

1,621,888 $ 1,075,862 $ 3,568,368

Total Loans Held For Investment
Real estate loans
Commercial real estate (CRE)
Nonowner occupied                               $   212,685          $

1,024,004 $ 379,027 $ 1,615,716 Multi-family residential

                             60,647               600,578              158,798              820,023
Land development and construction loans             100,029               169,776                3,369              273,174
                                                    373,361             1,794,358              541,194            2,708,913
Single-family residential                           525,384               165,226              412,235            1,102,845
Owner occupied                                       68,976               347,154              630,320            1,046,450
                                                    967,721             2,306,738            1,583,749            4,858,208
Commercial loans                                    629,399               561,491              190,344            1,381,234
Loans to financial institutions and acceptances           -                13,292                    -               13,292
Consumer loans and overdrafts                       162,308                26,916              415,236              604,460
                                                $ 1,759,428          $  2,908,437          $ 2,189,329          $ 6,857,194

__________________


(1)  Includes a total of $181.1 million of fixed-rate loans (mainly comprised of
53% single-family residential and 40% owner occupied), and $319.3 million of
variable-rate loans (mainly comprised of 90% single-family residential and 9%
owner occupied), maturing in 10 years or more. Fixed-rate and variable-rate
loans maturing in 15 years or more represent 62.3% of total fixed-rate and 72.9%
of total variable-rate loans maturing in 10 years or more, respectively, and
correspond primarily to single-family residential loans.
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As of December 31, 2022, total loans held for investment include approximately
$1.1 billion, or 15.5% of total loans held for investment, of loans that are
priced based on variable interest rates tied to the LIBOR, including: (i) $0.3
million that mature in six months or less, and (ii) $0.8 million that mature in
more than six months. In December of 2019, the Company appointed a management
team charged with the responsibility of monitoring developments related to the
proposed alternative reference interest rates to replace LIBOR, and guide the
Company through the potential discontinuation of LIBOR. In 2020, the Company
launched the LIBOR cessation project to identify and quantify LIBOR exposure in
all product categories and lines of business, both on- and off-balance-sheet.
During 2021, the Company completed its assessment of all third party-provided
products, services, and systems that would be affected by any changes to
references to LIBOR, including changes to all relevant systems. Beginning in
January 2022, the Company started referencing new loans and other products,
including loan-level derivatives, to the Secured Overnight Financing Rate
("SOFR"). The Company began migrating identified existing loans and derivative
contracts from LIBOR to SOFR gradually during 2022.

The tables below set forth the unpaid principal balance of total loans held for sale by type, by interest rate type (fixed-rate and variable-rate) and by original contractual loan maturities as of December 31, 2022:



                                              Due in         Due after        Due after
                                             one year         one year          five
(in thousands)                                or less       through five        years         Total

Fixed-Rate
Real estate loans
Commercial real estate (CRE)
Nonowner occupied                           $       -      $          -      $       -      $      -
Multi-family residential                            -                 -              -             -
Land development and construction loans             -                 -          9,424         9,424
                                                    -                 -          9,424         9,424
Single-family residential (1)                       -                 -         53,014        53,014
Owner occupied                                      -                 -              -             -

                                            $       -      $          -      $  62,438      $ 62,438
Variable-Rate
Real estate loans
Commercial real estate (CRE)
Nonowner occupied                           $       -      $          -      $       -      $      -
Multi-family residential                            -                 -              -             -

                                            $       -      $          -      $       -      $      -

Total Loans Held For Sale
Real estate loans
Commercial real estate (CRE)
Nonowner occupied                           $       -      $          -      $       -      $      -
Multi-family residential                            -                 -              -             -
Land development and construction loans             -                 -          9,424         9,424
                                                    -                 -          9,424         9,424
Single-family residential (1)                       -                 -         53,014        53,014
Owner occupied                                      -                 -              -             -

Total loans held for sale (2)               $       -      $          -      $  62,438      $ 62,438


__________________

(1)  Loans held for sale carried at their estimated fair value originated by
Amerant Mortgage.
(2) Remained current and in accrual status as of December 31, 2022.




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Foreign Outstanding



The table below summarizes the composition of our international loan portfolio
by country of risk for the periods presented. All of our foreign loans are
denominated in U.S. dollars, and bear fixed or variable rates of interest based
upon different market benchmarks plus a spread.

                                                                                    December 31,
                                               2022                                    2021                                     2020
(in thousands, except            Net Exposure             %              Net Exposure             %              Net Exposure              %
percentages)                         (1)             Total Assets            (1)             Total Assets             (1)             Total Assets

Venezuela (2)(3)                 $  47,037                  0.5  %       $  64,636                  0.9  %       $   86,930                  1.1  %

Other (4)                           52,156                  0.6  %          35,006                  0.4  %           65,968                  0.9  %
Total                            $  99,193                  1.1  %       $  99,642                  1.3  %       $  152,898                  2.0  %


_________________
(1)  Consists of outstanding principal amounts, net of collateral of cash, cash
equivalents or other financial instruments totaling $6.3 million, $21.1 million
and $13.3 million as of December 31, 2022, 2021 and 2020 respectively.
(2)  Includes mortgage loans for single-family residential properties located in
the U.S. totaling 47.0 million, $64.6 million and $86.7 million as of
December 31, 2022, 2021 and 2020, respectively.
(3) There were no outstanding credit card balances as of December 31, 2022, 2021
and 2020.
(4) Includes loans to borrowers in other countries which do not individually
exceed one percent of total assets in 2022, 2021 and 2020.


As of December 31, 2022, the maturities of our outstanding international loans
were as follows:
(in thousands)     Less than 1 year(1)       1-3 Years(1)       More than 3 years(1)       Total(1)

Venezuela(2)      $              3,507      $         295      $              43,235      $ 47,037

Other(3)                        13,221             13,647                     25,288        52,156
Total             $             16,728      $      13,942      $              68,523      $ 99,193


_________________
(1)  Consists of outstanding principal amounts, net of collateral of cash, cash
equivalents or other financial instruments totaling $6.3 million.
(2)  Includes mortgage loans for single-family residential properties located in
the U.S.
(3)  Includes loans to borrowers in other countries which do not individually
exceed one percent of total assets in 2022.

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Loans by Economic Sector

The table below summarizes the concentration in our loans held for investment by economic sector as of the end of the periods presented.


                                                                                            December 31,
(in thousands, except
percentages)                                       2022                                         2021                                         2020

                                      Amount              % of Total               Amount              % of Total               Amount              % of Total
Financial Sector (1)              $   190,934                     2.8  %       $    78,168                     1.5  %       $    89,187                     1.5  %
Construction and real estate (2)    2,378,081                    34.7  %         2,314,281                    42.8  %         2,844,094                    48.7  %
Manufacturing:
Foodstuffs, apparel                    87,198                     1.3  %            87,006                     1.6  %           108,312                     1.9  %
Metals, computer, transportation
and other                              52,160                     0.8  %           101,807                     1.9  %           129,705                     2.2  %
Chemicals, oil, plastics, cement
and wood/paper                         22,929                     0.3  %            34,133                     0.6  %            41,451                     0.7  %
Total manufacturing                   162,287                     2.4  %           222,946                     4.1  %           279,468                     4.8  %
Wholesale                             614,971                     8.9  %           572,109                    10.6  %           609,318                    10.4  %
Retail trade (3)                      424,894                     6.2  %           380,545                     7.0  %           423,260                     7.2  %
Services:
Non-financial public sector             1,300                       -  %                 1                       -  %               472                       -  %
Communication, transportation,
health and other                      487,842                     7.1  %           375,973                     7.0  %           394,479                     6.8  %
Accommodation, restaurants,
entertainment                         602,877                     8.8  %           508,615                     9.4  %           445,763                     7.6  %
Electricity, gas, water, supply
and sewage                             24,908                     0.4  %            19,309                     0.4  %            34,677                     0.6  %
Total services                      1,116,927                    16.3  %           903,898                    16.7  %           875,391                    15.0  %

Other loans (4)                     1,969,100                    28.7  %           937,493                    17.3  %           721,619                    12.4  %
                                  $ 6,857,194                   100.0  %       $ 5,409,440                   100.0  %       $ 5,842,337                   100.0  %


_________________
(1)  Consists mainly of domestic non-bank financial services companies.
(2)  Comprised mostly of CRE loans throughout South Florida, the greater
Houston, Texas area, and New York.
(3) Gasoline stations represented approximately 57%, 59% and 60% of the retail
trade sector at year-end 2022, 2021 and 2020, respectively.
(4)  Primarily loans belonging to industrial sectors not included in the above
sectors, which do not individually represent more than 1 percent of the total
loan portfolio, and consumer loans which represented approximately 28.6%, 17.2%
and 12.6% of the total in 2022, 2021 and 2020, respectively.

As of December 31, 2022 and 2021, the Company had $62.4 million and $158.1 million, respectively, of loans held for sale in the construction and real estate economic sector.There were no loans held for sale at December 31, 2020.

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Loan Quality



We use what we believe is a comprehensive methodology to monitor credit quality
and manage credit concentrations within our loan portfolio. Our underwriting
policies and practices govern the risk profile and credit and geographic
concentrations of our loan portfolio. We also believe we employ a comprehensive
methodology to monitor our intrinsic credit quality metrics, including a risk
classification system that identifies possible problem loans based on risk
characteristics by loan type, as well as the early identification of
deterioration at the individual loan level. We also consider the evaluation of
loan quality by the OCC, our primary regulator.

Analysis of the Allowance for Credit Losses



In 2022, the Company adopted Accounting Standards Codification Topic 326 -
Financial Instruments - Credit Losses (ASC Topic 326), which replaced the
incurred loss methodology for estimated probable loan losses with an expected
credit loss methodology that is referred to as the current expected credit loss
("CECL") methodology. The Company adopted the CECL guidance as of the beginning
of the reporting period of adoption, January 1, 2022, using a modified
retrospective approach for all its financial assets measured at amortized cost
and off-balance sheet credit exposures. See "Critical Accounting Policies and
Estimates" later in this document for more details on the methodology for
measuring credit losses under the CECL guidance.

The allowance for credit losses, or ACL, is a valuation account that is deducted
from the amortized cost basis of loans held for investment to present the net
that is expected to be collected throughout the life of the loan. The estimated
ACL is recorded through a provision for credit losses charged against income.
Management periodically evaluates the adequacy of the ACL to maintain it at a
level it believes to be reasonable.

The Company develops and documents its methodology to determine the ACL at the
portfolio segment level. The Company determines its loan portfolio segments
based on the type of loans it carries and their associated risk characteristics.
The measurement of expected credit losses considers information about historical
events, current conditions, reasonable and supportable forecasts and other
relevant information. Determining the amount of the ACL is complex and requires
extensive judgment by management about matters that are inherently uncertain.
Re-evaluation of the ACL estimate in future periods, in light of changes in
composition and characteristics of the loan portfolio, changes in the reasonable
and supportable forecast and other factors then prevailing may result in
material changes in the amount of the ACL and credit loss expense in those
future periods.

Expected credit losses are estimated on a collective basis for groups of loans
that share similar risk characteristics. Factors that may be considered in
aggregating loans for this purpose include but are not necessarily limited to,
product or collateral type, industry, geography, internal risk rating, credit
characteristics such as credit scores or collateral values, and historical or
expected credit loss patterns. For loans that do not share similar risk
characteristics with other loans such as collateral dependent loans and
modifications to borrowers experiencing financial difficulties, expected credit
losses are estimated on an individual basis.

With respect to modifications made to borrowers experiencing financial
difficulty, a change to the ACL is generally not recorded upon modification
since the effect of these modifications is already included in the ACL given the
measurement methodologies used to estimate the ACL. From time to time, the
Company modifies loans by providing principal forgiveness on certain of its real
estate loans. When principal forgiveness is provided, the amortized cost basis
of the asset is written off against the ACL. The amount of the principal
forgiveness is deemed to be uncollectible; therefore, that portion of the loan
is written off, resulting in a reduction of the amortized cost basis and a
corresponding adjustment to the ACL.






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Problem Loans. Loans are considered delinquent when principal or interest
payments are past due 30 days or more. Loans on which the accrual of interest
has been discontinued are designated as nonaccrual loans. Once a loan to a
single borrower has been placed in nonaccrual status, management reviews all
loans to the same borrower to determine their appropriate accrual status. When a
loan is placed in nonaccrual status, accrual of interest and amortization of net
deferred loan fees or costs are discontinued, and any accrued interest
receivable is reversed against interest income. Typically, the accrual of
interest on loans is discontinued when principal or interest payments are past
due 90 days or when, in the opinion of management, there is a reasonable doubt
as to collectability in the normal course of business. When loans are placed on
nonaccrual status, all interest previously accrued but not collected is reversed
against current period interest income. Income on nonaccrual loans is
subsequently recognized only to the extent that cash is received and the loan's
principal balance is deemed collectible. Loans are restored to accrual status
when loans become well-secured and management believes full collectability of
principal and interest is probable.


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Allocation of Allowance for Credit Losses



In the following table, we present the allocation of the ACL by loan segment at
the end of the periods presented. The amounts shown in this table should not be
interpreted as an indication that charge-offs in future periods will occur in
these amounts or percentages. These amounts represent our best estimates of
expected credit losses to be collected throughout the life of the loans, at the
reported dates, derived from historical events, current conditions and
reasonable and supportable forecasts at the dates reported. Our allowance for
credit losses is established using estimates and judgments, which consider the
views of our regulators in their periodic examinations. Re-evaluation of the ACL
estimate in future periods, in light of changes in composition and
characteristics of the loan portfolio, changes in the reasonable and supportable
forecast and other factors then prevailing may result in material changes in the
amount of the ACL and credit loss expense in those future periods. We also show
the percentage of each loan class, which includes loans in nonaccrual status.

                                                                                                                   December 31,
                                      2022                                    2021                                     2020                                    2019                                    2018
                                           % of Loans in                           % of Loans in                            % of Loans in                           % of Loans in                           % of Loans in
(in thousands, except                      Each Category                           Each Category                            Each Category                           Each Category                           Each Category
percentages)             Allowance        to Total Loans         Allowance

to Total Loans Allowance to Total Loans Allowance to Total Loans Allowance to Total Loans



Domestic Loans
Real estate               25,237                  42.2  %       $ 17,952                  43.5  %       $  50,227                  48.2  %       $ 25,040                  51.7  %       $ 22,778                  51.3  %
Commercial                25,483                  34.7  %         38,616                  38.7  %          48,035                  38.0  %         22,132                  38.1  %         29,278                  37.0  %
Financial institutions         -                   0.2  %             41                   0.3  %               -                   0.3  %             42                   0.3  %             41                   0.3  %
Consumer and others (1)   31,569                  21.5  %         11,762                  15.7  %          10,729                  10.9  %          1,677                   6.9  %          1,985                   6.3  %
                          82,289                  98.6  %         68,371                  98.2  %         108,991                  97.4  %         48,891                  97.0  %         54,082                  94.9  %

International Loans (2)
Commercial                   405                   0.6  %            363                   0.4  %              95                   0.9  %            350                   0.8  %            740                   1.2  %
Financial institutions         -                     -  %              1                     -  %               1                     -  %              -                     -  %            404                   0.8  %
Consumer and others (1)      806                   0.8  %          1,164                   1.4  %           1,815                   1.7  %          2,982                   2.2  %          6,536                   3.1  %
                           1,211                   1.5  %          1,528                   1.8  %           1,911                   2.6  %          3,332                   3.0  %          7,680                   5.1  %
Total Allowance for
Loan Losses             $ 83,500                 100.0  %       $ 69,899                 100.0  %       $ 110,902                 100.0  %       $ 52,223                 100.0  %       $ 61,762                 100.0  %
% Total Loans held for
investment                  1.22  %                                 1.29  %                                  1.90  %                                 0.91  %                                 1.04  %


__________________
(1)   Includes (i) indirect consumer loans purchased in 2022, 2021 and 2020;
(ii) mortgage loans secured by single-family residential properties located in
the U.S in all years presented; and (iii) credit card receivables to cardholders
for whom charge privileges have been stopped as of December 31, 2019. The total
allowance for credit losses for credit card receivables, after charge-offs, was
at $1.8 million at December 31, 2019. We discontinued or credit card programs in
2020 and the outstanding credit card balances at the close of 2019 were repaid
during the first quarter of 2020. There are no credit card balances or allowance
for credit losses on the credit card product in 2022, 2021 and 2020.
(2)   Includes transactions in which the debtor or customer is domiciled outside
the U.S. despite all collateral being located in the U.S.

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In 2022, the changes in the allocation of the ACL were primarily attributed to improved macro-economic conditions, criticized loans upgrades, payoffs and pay-downs, sales of non-performing loans and recoveries. This was partially offset by reserve requirements for loan charge-offs, commercial, CRE and consumer loan growth and loans downgrades during the period.



While most of the measures and restrictions enacted during the COVID-19 pandemic
have been lifted, and many businesses reopened, the Company cannot predict when
circumstances may change and whether restrictions that have been lifted will
need to be imposed or tightened in the future if viewed as necessary due to
public health concerns. Given the uncertainty regarding the spread and severity
of the COVID-19 pandemic and its adverse effects on the U.S. and global
economies, the impact to the Company's loan portfolio cannot be accurately
predicted at this time. Additionally, in late September 2022, the Hurricane
impacted several countries in the Caribbean, and the U.S., causing significant
damage, and disrupting businesses in several regions, including several South
and Central Florida counties in which the Company does business, including the
Tampa Bay, Port Charlotte, Naples and Orlando markets and their surrounding
areas. See - "Hurricane Ian" in "Item1- Business" for more information about the
Hurricane. The Company has not identified any significant impacts to the loan
portfolio of the Company deemed to be located in the areas that may have been
meaningfully impacted by the Hurricane, and the Company has not identified any
significant impact to the collateral securing the loans in the exposed loan
portfolio in the region. The Company has been in contact with the impacted
borrowers and has been performing site visits as well. Since there is
significant uncertainty with respect to the full extent of the negative impacts
due to the unprecedented nature of the Hurricane, the Company's estimates with
respect to the loan portfolio potentially impacted and the ACL, are based on
judgment and subject to change as conditions evolve. The Company will continue
to carefully assess and review the exposure of the portfolios to
hurricane-related factors, economic trends and their effect on credit quality
and that assessment and review could result in further provision for credit
losses in future periods.

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Non-Performing Assets



In the following table, we present a summary of our non-performing assets by
loan class, which includes non-performing loans by portfolio segment, both
domestic and international, and OREO, at the dates presented. Non-performing
loans consist of (1) nonaccrual loans where the accrual of interest has been
discontinued; (2) accruing loans ninety days or more contractually past due as
to interest or principal; and (3) restructured loans that are considered
Troubled Debt Restructurings, or TDR..

                                                              December 31,
(in thousands)                        2022          2021          2020          2019          2018

Non-Accrual Loans(1)
Domestic Loans:
Real estate loans
Commercial real estate (CRE)
Nonowner occupied                  $ 20,057      $  7,285      $  8,219      $  1,936      $      -
Multifamily residential                   -             -        11,340             -             -

                                     20,057         7,285        19,559         1,936             -
Single-family residential             1,307         3,349         8,778         5,431         5,198
Owner occupied                        6,270         8,665        12,815        14,130         4,983
                                     27,634        19,299        41,152        21,497        10,181
Commercial loans (2)(3)               9,271        28,440        44,205         9,149         4,772
Consumer loans and overdrafts(4)          1           251           219           390            11
Total Domestic                       36,906        47,990        85,576        31,036        14,964

International Loans: (5)
Real estate loans
Single-family residential               219         1,777         1,889         1,860         1,491
Commercial loans                          -             -             -             -             -
Consumer loans and overdrafts             3             6            14            26            24
Total International                     222         1,783         1,903         1,886         1,515
Total-Non-Accrual Loans            $ 37,128      $ 49,773      $ 87,479      $ 32,922      $ 16,479

Past Due Accruing Loans(6)
Domestic Loans:
Real estate loans
Single-family residential          $    253      $      -      $      -      $      -      $     54
Owner occupied                            -             -           220             -             -
Commercial loans                        183             -             -             -             -
Consumer loans and overdrafts            35             8             1             -             -
Total Domestic                          471             8           221             -            54

International Loans (5):
Real estate loans
Single-family residential                 -             -             -             -           365
Consumer loans and overdrafts             -             -             -             5           884
Total International                       -             -             -             5         1,249
Total Past Due Accruing Loans           471             8           221             5         1,303
Total Non-Performing Loans           37,599        49,781        87,700        32,927        17,782
Other real estate owned                   -         9,720           427            42           367
Total Non-Performing Assets        $ 37,599      $ 59,501      $ 88,127      $ 32,969      $ 18,149




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__________________


(1)  Includes loan modifications that meet the definition of TDRs, which may be
performing in accordance with their modified loan terms. As of December 31, 2021
and 2020, non-performing TDRs include $9.1 million and $8.4 million,
respectively, in a multiple loan relationship to a South Florida borrower. In
the third quarter of 2022, this loan relationship was upgraded and placed back
in accrual status.
(2) As of December 31, 2021 and 2020, includes $9.1 million and $19.6 million,
respectively, in a commercial relationship placed in nonaccrual status during
the second quarter of 2020. During the third quarters of 2021 and 2020, the
Company charged off $5.7 million and $19.3 million, respectively, against the
allowance for credit losses as result of the deterioration of this commercial
relationship. In addition, in connection with this loan relationship, the
Company collected a partial principal payment of $4.8 million in the fourth
quarter of 2021. Furthermore, in the second quarter of 2022, the Company
collected an additional partial principal payment of $5.5 million and charged
off the remaining balance of $3.6 million against the ACL. Therefore, as of
December 31, 2022, there were no outstanding balances associated with this loan
relationship.
(3)  In the first quarter of 2022, the Company collected a partial payment of
approximately $9.8 million on one commercial nonaccrual loan of $12.4 million.
Also, in the first quarter of 2022, the Company charged-off the remaining
balance of this loan of $2.5 million.
(4)  In the fourth quarter of 2022, the Company changed its charge-off policy
for unsecured consumer loans from 120 to 90 days past due. This change resulted
in an additional $3.4 million in charge-off for unsecured consumer loans in
2022.
(5)  Includes transactions in which the debtor or customer is domiciled outside
the U.S., despite all collateral being located in the U.S.
(6)  Loans past due 90 days or more but still accruing.

The following table presents the activity of non-performing assets in 2022:




(in thousands)                                    Year Ended December 31,

2022


Balance at beginning of the year                 $

59,501

Plus:


Loans placed in nonaccrual status (1)

55,103

Less:


Nonaccrual loan charge-offs (2)

(22,106)


Nonaccrual loans sold, net of charge offs (3)

(12,879)


Other real estate owned sold

(9,720)


  Nonaccrual loan collections and others (4)

(23,828)


Loans returned to accrual status (5)                                    (8,472)
Balances at end of the year                      $                      37,599


_________

(1) Includes: (i) a New York based non-owner occupied loan of $24.0 million
which was among the loans charged-off in 2022: (ii) a commercial loan
relationship with a South Florida borrower in the construction industry totaling
$11.2 million; (iii) one non-owner occupied loan of $5.7 million which was among
the loans sold during the period; (iii) one commercial loan of $2.9 million, and
(iv) an aggregate of $11.3 million in smaller loans, mainly consumer loans.
(2) Includes: $6.1 million related to two commercial nonaccrual loans paid off
during the period; (ii) $3.9 million related to a New York based non-owner
occupied loan; (iii) $3.0 million related to multiple commercial loans, and (iv)
an aggregate $9.1 million related to multiple consumer loans
(3) In April 2022, the Company completed the sale of two non-owner occupied
nonaccrual loan of approximately $11.6 million, at its par value. In addition,
in January 2022, the Company completed the sale of multiple single-family
residential nonaccrual loans of approximately $1.3 million at its par value.
(4) Includes: (i) $16.2 million related to three commercial loans; (ii) $2.4
million related to two owner occupied loans; (iii) $1.8 million related to two
consumer loans included in a loan relationship with a South Florida borrower in
the construction industry; (iv) $0.9 million related to one single-family
residential loan, and (v) a total of $2.5 million related to smaller loans.
(5) Primarily mainly related to a multiple loan relationship with a South
Florida borrower.



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In the fourth quarter of 2022, the Company placed in nonaccrual status a New
York based non-owner occupied loan in the retail industry of $24.0 million,
gross of a $3.9 million charge off recorded in the fourth quarter of 2022. The
Company expects to transfer this loan into OREO during the first quarter of
2023, once we finalize obtaining ownership.

In January 2022, the Company collected a partial payment of approximately $9.8
million on one commercial nonaccrual loan of $12.4 million. Also, in January
2022, the Company charged-off the remaining balance of this loan of $2.5
million.

In April 2022, the Company completed the sale of two non-owner occupied
nonaccrual loan of approximately $11.6 million, at its par value. In addition in
January 2022, the Company completed the sale of multiple single-family
residential nonaccrual loans of approximately $1.3 million at its par value. In
the second quarter of 2022, in connection with the loan relationship with the
Coffee Trader, the Company collected an additional partial principal payment of
$5.5 million and charged off the remaining balance of $3.6 million. Therefore,
as of December 31, 2022 there were no outstanding balances associated with this
loan relationship.

In October 2022, the Company sold an OREO property in New York (the "NY OREO
property") at its carrying value of $6.1 million. Also, in November 2022, the
Company sold the remaining OREO property at its carrying value of $0.3 million.
These transactions had no impact on the Company's consolidated result of
operations. In 2022, we recorded an expense of $3.4 million in connection with
changes in the estimated fair value and related disposition costs of its OREO
property in New York. See "Item 7. Management's Discussion and Analysis Of
Financial Condition And Results Of Operations" included in the Form 10-K for the
year ended December 31, 2021 for more details on this OREO property.

There were $8.5 million in loans which were placed back in accrual status in
2022, mainly in connection with a multiple loan relationship with a South
Florida borrower totaling $8.1 million at the time of transfer from nonaccrual
to accrual status. As a result, the Company will recognize, as an adjustment to
the yield, $1.5 million for the remaining average maturity of these loans of 8
years.We recognized no interest income on nonaccrual loans during 2022, 2021 and
2020.We recognized interest income on loans modified under troubled debt
restructurings of $0.3 million, $0.1 million and $36 thousand during the years
ended December 31, 2022, 2021 and 2020, respectively. At December 31, 2022 and
2021 , there were $10.1 million and $2.9 million, respectively of TDRs which
were all accruing interest at these dates.

We utilize an asset risk classification system in compliance with guidelines
established by the U.S. federal banking regulators as part of our efforts to
monitor and improve asset quality. In connection with examinations of insured
institutions, examiners have the authority to identify problem assets and, if
appropriate, classify them or require a change to the rating assigned by our
risk classification system. There are four classifications for problem assets:
"special mention," "substandard," "doubtful," and "loss." Special mention loans
are loans identified as having potential weakness that deserve management's
close attention. If left uncorrected, these potential weaknesses may, at some
future date, result in the deterioration of the repayment prospects of the loan.
Substandard assets have one or more defined weaknesses and are characterized by
the distinct possibility that the insured institution will sustain some loss if
the deficiencies are not corrected. Doubtful assets have the weaknesses of
substandard assets with the additional characteristic that the weaknesses make
collection or liquidation in full questionable and there is a high probability
of loss based on currently existing facts, conditions and values. An asset
classified as loss is not considered collectable and is of such little value
that the continuance of carrying a value on the books is not warranted.


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We use the term "classified loans" to describe loans that are substandard and doubtful, and we use the term "criticized loans" to describe loans that are special mention and classified loans.



The Company's loans by credit quality indicators at December 31, 2022, 2021 and
2020 are summarized in the following table. We have no purchased credit-impaired
loans.

                                                  2022                                                        2021                                                         2020
                            Special                                                     Special                                                      Special
(in thousands)              Mention      Substandard     Doubtful    Total(1)           Mention      Substandard    Doubtful     Total(1)            Mention      Substandard    Doubtful     Total(1)
Real estate loans
Commercial real estate
(CRE)
Nonowner occupied         $   8,378    $     20,113    $       -    $ 28,491          $  34,205    $      5,890    $  1,395    $  41,490          $   46,872    $      4,994    $  3,969    $  55,835
Multi-family residential          -               -            -           -                  -               -           -            -                   -          11,340           -       11,340
Land development and
construction loans                -               -            -           -                  -               -           -            -               7,164               -           -        7,164
                              8,378          20,113            -      28,491             34,205           5,890       1,395       41,490

54,036 16,334 3,969 74,339 Single-family residential -

           1,930            -       1,930                  -           5,221           -        5,221                   -          10,667           -       10,667
Owner occupied                    -           6,356            -       6,356              7,429           8,759           -       16,188              22,343          12,917           -       35,260
                              8,378          28,399            -      36,777             41,634          19,870       1,395       62,899

76,379 39,918 3,969 120,266 Commercial loans (2) 1,749 10,446

            3      12,198             32,452          20,324       9,497       62,273

42,434 21,152 23,256 86,842



Consumer loans and
overdrafts                        -             230            -         230                  -             270           -          270                   -             238           -          238
                          $  10,127    $     39,075    $       3    $ 49,205          $  74,086    $     40,464    $ 10,892    $ 125,442          $  118,813    $     61,308    $ 27,225    $ 207,346


_________
(1) There were no loans categorized as "Loss" as of the dates presented.
(2) As of December 31, 2021 and 2020, Substandard loans included $4.9 million
and $7.3 million, respectively, and doubtful loans included $4.2 million and
$12.3 million, respectively, related to a commercial relationship placed in
nonaccrual status and downgraded in the second quarter of 2020. During the third
quarters of 2021 and 2020, the Company charged off $5.7 million and $19.3
million against the allowance for credit losses as result of the deterioration
of this commercial relationship. In addition, in connection wit this loan
relationship, the Company collected a partial principal payment of $4.8 million
in the fourth quarter of 2021. Furthermore, in the second quarter of 2022, the
Company collected an additional partial principal payment of $5.5 million and
charged off the remaining balance of $3.6 million against the allowance for
credit losses. Therefore, as of December 31, 2022, there were no outstanding
balances associated with this loan relationship.











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2022 compared to 2021

Classified Loans. Classified loans includes substandard and doubtful loans. The following table presents the activity of classified loans in 2022:





(in thousands)                                      Year Ended December 31,

2022


Balance at beginning of the year                   $

51,356

Plus:


Loans downgraded to substandard and doubtful (1)

55,103

Less:


Classified loan charge-offs (2)

(22,106)


Classified loans sold, net of charge offs (3)

(12,879)


Classified loan collections and others (4)                               (23,924)
Loans upgraded (5)                                                        (8,472)
Balances at end of the year                        $                      39,078


_________

(1) Includes: (i) a New York based non-owner occupied loan of $24.0 million. We
charged-off $3.9 million in 2022; (ii) a commercial loan relationship with a
South Florida borrower in the construction industry totaling $11.2 million;
(iii) one non-owner occupied loan of $5.7 million which was among the loans sold
during the period; (iii) one commercial loan of $2.9 million, and (iv) an
aggregate of $11.3 million in smaller loans, mainly consumer loans.
(2) Includes: $6.1 million related to two commercial nonaccrual loans paid off
during the period; (ii) $3.9 million related to a New York based non-owner
occupied loan; (iii) $3.0 million related to multiple commercial loans, and (iv)
an aggregate $9.1 million related to multiple consumer loans
(3) In April 2022, the Company completed the sale of two non-owner occupied
nonaccrual loan of approximately $11.6 million, at its par value. In addition,
in January 2022, the Company completed the sale of multiple single-family
residential nonaccrual loans of approximately $1.3 million at its par value.
(4) Includes: (i) $16.2 million related to three commercial loans; (ii) $2.4
million related to two owner occupied loans; (iii) $1.8 million related to two
consumer loans included in a loan relationship with a South Florida borrower in
the construction industry; (iv) $0.9 million related to one single-family
residential loan, and (v) a total of $2.6 million related to smaller loans.
(5) Primarily mainly related to a multiple loan relationship with a South
Florida borrower.

Special Mention Loans. Special mention loans as of December 31, 2022 totaled
$10.1 million, a decrease of $64.0 million, or 86.3%, from $74.1 million as of
December 31, 2021. This decrease was primarily due to upgrades totaling $42.2
million, including: (i) one non-owner occupied loan of $24.9 million; (ii) one
commercial loan of $13.2 million that was subsequently paid off, and (iii)
multiple commercial loans totaling $4.1 million. In addition, there were total
paydowns/payoffs of $24.4 million, including: (i) $13.2 million related to one
commercial loan; (ii) $7.4 million related to one owner occupied loan: (iii)
$3.5 million related to two non-owner occupied loans, and (iv) a total of $0.2
million in other smaller paydowns. Also, there were loans further downgraded to
classified totaling $37.1 million, including: (i) a New York based non-owner
occupied loan of $29.0 million; (ii) a non-owner occupied loan of $5.7 million
which was subsequently sold during the period, and (iii) an owner-occupied loan
of $2.3 million, initially classified as special mention during the period.

The decrease in special mention loans was partially offset by downgrades to
special mention totaling $31.3 million, including the aforementioned New York
based non-owner occupied loan of $29.0 million and the owner occupied loan of
$2.3 million. Also, there was an increase related to a non-owner occupied loan
of $8.4 million that had been identified as a loan with potential weakness since
2021.This loan was presented as part of loans held for sale carried at the lower
of cost or fair value at December 31, 2021, and subsequently reclassified to
loans held for investment during the third quarter of 2022.

All special mention loans remained current at December 31, 2022.

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On March 26, 2020, the Company began offering loan payment relief options to
customers impacted by the COVID-19 pandemic, including interest only and/or
forbearance options. These programs continued throughout 2020 and in the first
nine months of 2021. In the third quarter of 2021, the Company ceased to offer
these loan payment relief options, including interest-only and/or forbearance
options. As of December 31, 2022, there were no loans under the deferral and/or
forbearance periods. At December 31, 2021, there were $37.1 million of loans
under the deferral and/or forbearance periods consisting of two CRE retail loans
in New York. During the first quarter of 2022, the renewal of those two CRE
retail loans in New York was completed. All loans that have moved out of
forbearance status have resumed regular payments, except for one CRE loan of
$12.1 million that was transferred to OREO during the third quarter of 2021. In
accordance with accounting and regulatory guidance, loans to borrowers
benefiting from these measures were not considered TDRs. See "Item 7.
Management's Discussion and Analysis Of Financial Condition And Results Of
Operations" included in the Form 10-K for the year ended December 31, 2021 for
more details on the $12.1 million loan transferred to OREO in 2021.


While it is difficult to estimate the extent of the impact of the COVID-19
pandemic on the Company's credit quality, we continue to proactively and
carefully monitor the Company's credit quality practices, including examining
and responding to patterns or trends that may arise across certain industries or
regions.

Potential problem loans at December 31, 2022, 2021 and 2020 included:




    (in thousands)                                         2022

2021 2020

Real estate loans

Commercial real estate (CRE)


    Nonowner occupied                                    $     -      $

- $ 744


    Multi-family residential                                   -            -            -
    Land development and construction loans                    -           94            -
                                                               -           94          744
    Single-family residential                                150           95            -
    Owner occupied                                            86            -          102
                                                             236          189          846
    Commercial loans                                       1,178        1,380          198


    Loans to depository institutions and acceptances           -            -            -
    Consumer loans and overdrafts (1)                        226           13            -
                                                         $ 1,640      $ 1,582      $ 1,044

________

(1) Corresponds to international consumer loans.



At December 31, 2022, total potential problem loans increased $0.1 million, or
3.7%, compared to December 31, 2021. This was mainly due to the addition of one
single-family residential loan of $0.2 million and multiple purchased consumer
loans totaling $0.2 million. These increases were partially offset by an
aggregate of $0.3 million in paydowns/payoffs of existing potential problem
loans.


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Securities



Our investment decision process is based on an approved investment policy and
several investment programs. We seek a consistent risk adjusted return through
consideration of the following four principles:

•investment quality;

•liquidity requirements;

•interest-rate risk sensitivity; and

•potential returns on investment



The Bank's Board of Directors approves the Bank's and related companies ALCO
investment policy and programs which govern the investment process. The ALCO
oversees the investment process monitoring compliance to approved limits and
targets. The Company's investment decisions are based on the above-mentioned
four principles, other factors considered relevant to particular investments and
strategies, market conditions and the Company's overall balance sheet position.
ALCO regularly evaluates the investments' performance within the approved limits
and targets. The Company proactively manages its investment securities portfolio
as a source of liquidity and as an economic hedge against declining interest
rates whenever appropriate.
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The following table sets forth the book value and percentage of each category of
securities at December 31, 2022, 2021 and 2020. The book value for debt
securities classified as available for sale and equity securities with readily
determinable fair value not held for trading represents fair value. The book
value for debt securities classified as held to maturity represents amortized
cost less an allowance for credit losses ("ACL") in 2022 if required. The
Company adopted CECL in 2022 and determined that an ACL on its debt securities
held to maturity as of December 31, 2022 was not required.

2022 2021 2020
Amount % Amount % Amount %
(in thousands, except
percentages)
Debt securities available for
sale:
U.S. government sponsored
enterprise debt 437,674 32.0 % 450,773 33.6 % 661,335 48.1 %
Corporate debt (1) (2) 280,700 20.6 % 357,790 26.7 % 301,714 22.0 %
U.S. government agency debt 330,821 24.2 % 361,906 27.0 % 204,578 14.9 %
Municipal bonds 1,656 0.1 % 2,348 0.2 % 54,944 4.0 %
Collateralized loan
obligations 4,774 0.4 % - - % - - %

U.S. Treasury debt 1,996 0.1 % 2,502 0.2 % 2,512 0.2 %
1,057,621 77.4 % 1,175,319 87.7 % 1,225,083 89.2 %

Debt securities held to
maturity (3) 242,101 17.7 % 118,175 8.8 % 58,127 4.2 %

Equity securities with readily
determinable fair value not
held for trading(4) 11,383 0.8 % 252 - % 24,342 1.8 %

Other securities (5): 55,575 4.1 % 47,495 3.5 % 65,015 4.8 %
$ 1,366,680 100.0 % $ 1,341,241 100.0 % $ 1,372,567 100.0 %

_________________
(1) As of December 31, 2022, 2021 and 2020 corporate debt securities include
$9.7 million, $12.5 million and $17.1 million, respectively, in
"investment-grade" quality securities issued by foreign corporate entities. The
securities issuers were from Canada in 2022, and from Japan and Canada in three
different sectors in 2021 and 2020. The Company limits exposure to foreign
investments based on cross border exposure by country, risk appetite and policy.
All foreign investments are denominated in U.S. Dollars.
(2) As of December 31, 2022, 2021 and 2020, debt securities in the financial
services sector issued by domestic corporate entities represent 2.3% , 3.1% and
2.7% of our total assets, respectively.
(3) Includes securities issued by U.S. government and U.S. government sponsored
agencies.
(4) In February 2023, the Company sold off all of its equity securities with
readily available fair value not held for trading and realized a loss on sale of
approximately $0.2 million. As of December 31, 2020, the balance shown in this
table included an open-end fund incorporated in the U.S. The Fund's objective is
to provide a high level of current income consistent with the preservation of
capital and investments deemed to be qualified under the Community Reinvestment
Act. During the fourth quarter of 2021, the Company sold this mutual fund which
had a fair value of $23.4 million at the time of the sale.
(5) Includes investments in FHLB and Federal Reserve Bank stock. Amounts
correspond to original cost at the date presented. Original cost approximates
fair value because of the nature of these investments.

As of December 31, 2022, total securities increased $25.4 million, or 1.9%, to
$1.4 billion compared to $1.3 billion as of December 31, 2021. The increase in
2022 was mainly driven by purchases of $457.4 million, primarily debt securities
available for sale and held to maturity. This was partially offset by: (i)
maturities, sales and calls totaling $292.0 million, primarily debt securities
available for sale, and (ii) net unrealized holding losses on debt securities
available for sale of $127.7 million attributable to increases in market
interest rates during the period.

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Debt securities available for sale had net unrealized holding losses of $113.0
million and net unrealized holding gains of $1.0 million at December 31, 2022
(December 31, 2021 - net unrealized holding losses $5.7 million and net
unrealized holding gains of $21.5 million). In 2022, the Company recorded net
unrealized holding losses of $127.7 million which are included in accumulated
other comprehensive (loss) income for the period. This was mainly attributable
to increases in market interest rates during the period which translated into a
decline in the estimated fair value of debt securities markets. The Company
considers these securities are not credit-impaired because the decline in their
estimated fair value is attributable to changes in interest rates and investment
securities markets, generally, and not credit quality. Additionally, the Company
does not intend to sell these debt securities and it considers that it is more
likely than not that it will not be required to sell the securities before their
anticipated recovery. See Note 3 to our audited consolidated financial
statements on this Form 10-K for more details on the composition of the
Company's investment portfolio.

As of December 31, 2022, total available for sale debt securities includes
residential and commercial mortgage-backed securities with amortized cost of
$743.0 million and $91.0 million, respectively, and fair value of $666.5 million
and $80.9 million, respectively. As of December 31, 2021, total available for
sale debt securities includes residential and commercial mortgage-backed
securities with amortized cost of $654.7 million and $123.5 million,
respectively, and fair value of $661.3 million and $123.8 million, respectively.

As of December 31, 2022, total debt securities held to maturity includes
residential and commercial mortgage-backed securities issued or sponsored by the
U.S. government with total fair values of $191.4 million ($213.9 million -
amortized cost) and $26.2 million ($28.2 million - amortized cost),
respectively. As of December 31, 2021, total debt securities held to maturity
includes residential and commercial mortgage-backed securities with total fair
values of $88.7 million ($89.4 million - amortized cost) and $30.4 million
($28.8 million - amortized cost), respectively.

The Company considers that all debt securities held to maturity issued or
sponsored by the U.S. government are considered to be risk-free as they have the
backing of the government. The Company considers there are not current expected
credit losses on these securities and, therefore, did not record an ACL on any
of its debt securities held to maturity as of December 31, 2022. The Company
monitors the credit quality of held to maturity securities through the use of
credit ratings. Credit ratings are monitored by the Company on at least a
quarterly basis. As of December 31, 2022 and 2021, all held to maturity
securities held by the Company were rated investment grade or higher.

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The following table sets forth the book value, scheduled maturities and weighted
average yields for our securities portfolio at December 31, 2022. Similar to the
table above, the book value for debt securities classified as available for sale
and equity securities with readily determinable fair value not held for trading
is equal to fair market value; The book value for debt securities classified as
held to maturity is equal to amortized cost.


                                                                                                                  December 31, 2022
(in thousands,                    Total                           Less than a year                    One to five years                     Five to ten years                        Over ten years                            No maturity
except percentages)      Amount              Yield            Amount


     Yield             Amount             Yield             Amount              Yield               Amount                Yield              Amount              Yield

Debt securities
available for sale
U.S. Government
sponsored enterprise
debt                 $   437,674              3.32  %       $     37              5.27  %       $  21,136              2.89  %       $   38,540              3.34  %       $      377,961              3.34  %       $         -                 -  %
Corporate
debt-domestic            270,979              3.97  %          9,108              4.47  %          45,293              3.88  %          205,628              3.98  %               10,950              3.74  %                 -                 -  %
U.S. Government
agency debt              330,821              3.18  %            136              4.05  %           2,806              3.16  %            8,433              4.59  %              319,446              3.14  %                 -                 -  %
Municipal bonds            1,656              2.49  %              -                 -  %               -                 -  %              342              2.01  %                1,314              2.61  %                 -                 -  %
Corporate
debt-foreign               9,721              3.64  %              -                 -  %               -                 -  %            9,721              3.64  %                    -                 -  %                 -                 -  %
Collateralized loan
obligations                4,774              6.49  %              -                 -  %               -                 -  %                -                 -  %                4,774              6.49  %                 -                 -  %
U.S. treasury
securities                 1,996              4.47  %              -                 -  %           1,996              4.47  %                -                 -  %                    -                 -  %                 -                 -  %

                     $ 1,057,621              3.46  %       $  9,281              4.47  %       $  71,231              3.57  %       $  262,664              3.89  %       $      714,445              3.28  %       $         -                 -  %

Debt securities held
to maturity          $   242,101              3.44  %       $      -                 -  %       $   6,480              2.50  %       $   13,130              2.90  %       $      222,491              3.50  %       $         -                 -  %

Equity securities
with readily
determinable fair
value not held for
trading                   11,383                 -  %              -                 -                  -                 -                   -                 -                       -                 -               11,383                 -  %

Other securities     $    55,575              5.16  %       $      -                 -  %       $       -                 -  %       $        -                 -  %       $            -                 -  %       $    55,575              5.16  %
                     $ 1,366,680              3.50  %       $  9,281              4.47  %       $  77,711              3.48  %       $  275,794

     3.84  %       $      936,936              3.33  %       $    66,958              4.28  %






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The investment portfolio's average effective duration in years was 4.9, 3.6 and
2.4 as of December 31, 2022, 2021 and 2020, respectively. The increase in
effective duration in 2022 compared to 2021 was primarily due to lower expected
and actual mortgage-backed securities prepayments resulting from increased
market interest rates.These estimates are computed using multiple inputs that
are subject, among other things, to changes in interest rates and other factors
that may affect prepayment speeds. Contractual maturities of investment
securities are adjusted for anticipated prepayments of amortizing U.S.
government sponsored agency debt and enterprise debt securities, which shorten
the average lives of these investments.

Goodwill. Goodwill was $19.5 million as of December 31, 2022 and 2021. Goodwill
mainly represents the excess of consideration paid over the fair value of the
net assets of a savings bank acquired in 2006, and the Cayman Bank acquired in
2019.


Liabilities. Total liabilities were $8.4 billion at December 31, 2022, an
increase of $1.6 billion, or 23.7%, compared to $6.8 billion at December 31,
2021. This was primarily driven by net increases of: (i) $1.4 billion, or 25.1%,
in total deposits, mainly due to an increase in interest bearing demand
deposits; (ii) the issuance of $30 million of 4.25% fixed-to-floating
subordinated notes due in 2032 in the first quarter of 2022; (iii) a net
increase of $96.9 million, or 12.0%, in FHLB advances, including the addition of
$1.1 billion of advances, primarily long-term fix-rate, which were partially
offset by the repayment of $1.0 billion of these borrowings in 2022, and (iv) an
increase of $72.2 million, or 67.8%, in other liabilities.

Other liabilities were $178.6 million as of December 31, 2022, an increase of
$72.2 million, or 67.8%, compared to $106.4 million at December 31, 2021. This
was primarily driven by: (i) an increase in the estimated fair value of
derivative instruments, and (ii) an increase in our obligation to return cash
collateral received in response to the change in fair value of derivative
instruments. See Note 12 to the Company's audited consolidated financial
statements in this Form 10-K for more details on these derivative instruments.

See "Capital Resources and Liquidity Management"for more details on the changes
of FHLB advances and subordinated notes and "Deposits" for more details on the
changes of total deposits.



Deposits

We strongly believe in being a deposit-first Company. This strategy is what
drives our business and our day to day relationship-building activities. In
2022, we continued with our efforts in growing our deposits. Our efforts
included the additions to Treasury Management, Retail and Private Banking team
members, which contributed to increasing deposit levels in 2022. See "Item
1.Business- Our Company- Business Developments" for additional information on
new digital platforms and other deposit-related initiatives.

Total deposits were $7.0 billion at December 31, 2022, an increase of $1.4
billion, or 25.1%, compared to December 31, 2021.The increase in deposits in
2022 was mainly due to a net increase of $1.0 billion, or 23.8%, in core
deposits, including increases of: (i) $793.0 million, or 52.6%, in interest
bearing transaction accounts, primarily due to new domestic deposits from escrow
accounts, municipalities and from domestic individuals and businesses through
large fund providers and customer relationships during the period; (ii) $184.4
million, or 16%, in noninterest bearing transaction accounts, and (iii) $45.5
million, or 2.8%, in savings and money market deposit accounts.

In addition, there was an increase of $390.4 million or 29.2%, in time deposits
in 2022 compared to 2021. The increase in time deposits balances in 2022
compared to 2021 was primarily attributable to an increase of $319.0 million, or
110.1%, in brokered time deposits. In addition, there was an increase of $71.4
million, or 6.8%, in customer CDs.

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The increase in transaction account balances in 2022 compared to 2021 includes
$1.1 billion or 26.2%, in higher customer account balances, partially offset by
a total decrease of $77.0 million, 79.0%, or in brokered interest bearing and
money market deposits.

As of December 31, 2022 total brokered deposits were $629.3 million, an increase
of $242.0 million, or 62.5%, compared to $387.3 million at December 31, 2021, as
the Company elected to increase brokered time deposits in order to lock lower
interest rates in light of rising market rates.

Domestic deposits increased $1.5 billion, or 47.3%, in 2022 to $4.6 billion at December 31, 2022 from $3.1 billion at December 31, 2021. Foreign deposits decreased $70.3 million, or 2.8%, in 2022 from $2.5 billion at December 31, 2021. See discussions further below.



The increase in transaction account balances in 2021 compared to 2020 includes
$645.7 million or 18.2%, in higher customer account balances, partially offset
by a total decrease of $42.8 million in brokered interest bearing and money
market deposits.

Deposits by Country of Domicile

The following table sets forth the deposits by country of domicile of the depositor as of the dates presented.



                                                      December 31,
(in thousands)          2022             2021             2020             2019             2018

Domestic (1)        $ 4,620,906      $ 3,137,258      $ 3,202,936      $ 3,121,827      $ 3,001,366
Foreign:
Venezuela (2)         1,911,551        2,019,480        2,119,412        2,270,970        2,694,690
Others                  511,742          474,133          409,295          364,346          336,630
Total foreign (3)     2,423,293        2,493,613        2,528,707        2,635,316        3,031,320
Total deposits      $ 7,044,199      $ 5,630,871      $ 5,731,643      $ 5,757,143      $ 6,032,686

___________


(1)   Includes brokered deposits of $629.3 million, $387.3 million, $634.5
million, $682.4 million and $642.1million at December 31, 2022, 2021, 2020, 2019
and 2018, respectively.
(2)  Based upon the diligence we customarily perform to "know our customers" for
anti-money laundering, OFAC and sanctions purposes, we believe that the current
U.S. economic embargo on certain Venezuelan persons will not adversely affect
our Venezuelan customer relationships, generally.
(3)  Our other foreign deposits do not include deposits from Venezuelan resident
customers.

The following table shows the increase or (decrease), during the year our domestic and foreign deposits, including Venezuelan resident customer deposits:

Years Ended December 31,


                                    2022                                  2021                                2020                                 2019

(in thousands, except


percentages)               Amount               %               Amount               %               Amount              %               Amount               %
Domestic (1)           $ 1,483,648             47.3  %       $  (65,678)            (2.1) %       $  81,109              2.6  %       $  120,461              4.0  %
Foreign:
Venezuela                 (107,929)            (5.3) %          (99,932)            (4.7) %        (151,558)            (6.7) %         (423,720)           (15.7) %
Others                      37,609              7.9  %           64,838             15.8  %          44,949             12.3  %           27,716              8.2  %
Total foreign              (70,320)            (2.8) %          (35,094)            (1.4) %        (106,609)            (4.0) %         (396,004)           (13.1) %
Total deposits         $ 1,413,328             25.1  %       $ (100,772)            (1.8) %       $ (25,500)            (0.4) %       $ (275,543)            (4.6) %


___________
(1)   Domestic deposits, excluding brokered deposits, increased $1.2 billion,
$181.5 million, $109.0 million and $100.2 million in 2022, 2021, 2020 and 2019,
respectively.
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Domestic deposits increased $1.5 billion, or 47.3%, in 2022 to $4.6 billion at
December 31, 2022 from $3.1 billion at December 31, 2021. This was primarily
driven by an increase in domestic core deposits which includes new deposits from
escrow accounts, municipalities, and from domestic individuals and businesses
through large fund providers and customer relationships during the period. In
addition, there was an increase of $319.0 million, or 110.1%, in domestic
brokered time deposits as the Company elected to increase these deposits in
order to lock lower interest rates in light of rising market rates.

Foreign deposits decreased $70.3 million, or 2.8%, in 2022 to $2.4 billion at
December 31, 2022 from $2.5 billion at December 31, 2021, primarily driven by a
decrease of $107.9 million, or 5.3%, in deposits from customers domiciled in
Venezuela. This was partially offset by an increase of $37.6 million, or 7.9%,
in deposits from countries other than Venezuela, primarily driven by our efforts
to grow deposits from customers in those other markets.

Core deposits



Core deposits were $5.3 billion, $4.3 billion and $3.7 billion as of
December 31, 2022, 2021 and 2020, respectively. Core deposits represented 75.5%,
76.2% and 64.4% of our total deposits at those dates, respectively. The increase
of $1.0 billion, or 23.8%, in core deposits in 2022 was mainly driven by the
previously mentioned increase in noninterest bearing and interest bearing demand
deposits. Core deposits consist of total deposits excluding all time deposits.

Brokered deposits



We utilize brokered deposits primarily as an Asset/Liability Management tool. As
of December 31, 2022 and 2021, we had $629.3 million and $387.3 million in
brokered deposits, which represented 8.9% and 6.9%, respectively, of our total
deposits. Brokered deposits increased $242.0 million, or 62.5%, in 2022 compared
to December 31, 2021, mainly due to an increase in brokered time deposits.

As of December 31, 2022 and 2021, brokered deposits included time deposits of
$608.7 million and $289.8 million, respectively, and third party interest
bearing deposits of $20.5 million and $97.5 million, respectively. The Company
has not historically sold brokered CDs in denominations over $100,000.


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Deposits by Type: Average Balances and Average Rates Paid

The following table sets forth the average daily balance amounts and the average rates paid on our deposits for the periods presented.

Years Ended December 31,


                                         2022                                    2021                                    2020
(in thousands, except
percentages)                   Amount              Rates               Amount              Rates               Amount              Rates

Non-interest bearing
demand deposits            $ 1,286,570                  -  %       $ 1,046,766                  -  %       $   876,393                  -  %
Interest bearing deposits:
Checking and saving
accounts:
Interest bearing demand
(1)                          1,872,100               0.81  %         1,309,699               0.05  %         1,154,166               0.04  %
Money market (2)             1,323,563               0.88  %         1,311,278               0.27  %         1,165,447               0.61  %
Savings                        319,631               0.04  %           324,618               0.02  %           321,766               0.02  %
Time Deposits (3)            1,334,605               1.66  %         1,668,459               1.42  %         2,360,367               1.94  %
                             4,849,899               1.01  %         4,616,054               0.60  %         5,001,746               1.07  %
                           $ 6,136,469               0.80  %       $ 5,660,820               0.49  %       $ 5,878,139               0.91  %


___________
(1)  In the years ended December 31, 2022, 2021 and 2020 includes reciprocal
deposits with a total average balance of $253.8 million (average rate - 1.35%),
$89.6 million (average rate - 0.13%) and $40.5 million (average rate - 0.08%),
respectively, and brokered deposits with a total average balance of $1.2 million
(average rate - 2.57%), $10.6 million (average rate - 0.33%) and $1.6 million
(average rate - 0.33%), respectively.
(2)  In the years ended December 31, 2022, 2021 and 2020, includes brokered
deposits with a total average balance of $43.3 million (average rate - 1.47%),
$109.3 million (average rate - 0.33%) and $25.6 million (average rate - 0.33%),
respectively.
(3)  In the years ended December 31, 2022, 2021 and 2020, includes brokered
deposits with average balances of $359.7 million, $414.4 million and $570.8
million, respectively, with average rates of 2.51% 2.11% and 2.21%,
respectively.
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Large Fund Providers



In the first quarter of 2022, the Company changed its definition of large fund
providers to include only third party relationships with balances over $20
million. Prior to 2022, large fund providers were defined as third party deposit
relationships with balances over $10 million. At December 31, 2022 and 2021,
third-party customer relationships with balances of over $20 million, included
twenty-two and eleven deposit relationships, respectively, with total balances
of $1.2 billion and $376.3 million respectively. The increase in large fund
providers in 2022 compared to December 31, 2021 was mainly driven by new
domestic deposits from escrow accounts, municipalities, and from domestic
individuals and businesses customer relationships during the period.

Large Time Deposits by Maturity



The following table sets forth the maturities of our time deposits with
individual balances equal to or greater than $100,000 as of the dates presented.

                                                                               December 31,
(in thousands, except
percentages)                                2022                                  2021                                   2020
Less than 3 months             $ 140,292               15.1  %       $ 261,779               31.1  %       $   433,918               34.6  %
3 to 6 months                    148,137               16.0  %         134,709               16.0  %           261,683               20.8  %
6 to 12 months                   497,436               53.6  %         153,695               18.3  %           241,367               19.2  %
1 to 3 years                     135,663               14.6  %         281,366               33.5  %           268,934               21.4  %
Over 3 years                       6,889                0.7  %           8,902                1.1  %            49,948                4.0  %
Total                          $ 928,417              100.0  %       $ 840,451              100.0  %       $ 1,255,850              100.0  %


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Short-Term Borrowings. In addition to deposits, we use short-term borrowings,
such as FHLB advances, and less frequently, advances from other banks, as a
source of funds to meet the daily liquidity needs of our customers and fund
growth in earning assets. Short-term borrowings have maturities of 12 months or
less as of the reported period-end. All of our outstanding short-term borrowings
at December 31, 2022, 2021 and 2020 corresponded to FHLB advances. There were no
other borrowings or repurchase agreements outstanding as of December 31, 2022,
2021 and 2020.

The following table sets forth information about the outstanding amounts of our
short-term borrowings at the close of and for years ended December 31, 2022,
2021 and 2020.

                                                                          Years Ended December 31,
(in thousands, except percentages)                          2022                        2021                 2020
Outstanding at period-end                             $     304,821                $         -          $         -
Average amount                                              111,448                     28,273               83,750
Maximum amount outstanding at any month-end                 304,821                    130,000              300,000

Weighted average interest rate:


 During period                                                 1.98   %                   0.36  %              1.45  %
 End of period                                                 3.17   %                      -  %                 -  %







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Return on Equity and Assets

The following table shows return on average assets, return on average equity, and average equity to average assets ratio for the periods presented:



                                                                      Years Ended December 31,
(in thousands, except percentages and per share data)      2022                 2021                 2020

Net income (loss) attributable to the Company $ 63,310 $ 112,921 $ (1,722) Basic earnings (loss) per common share

                       1.87                 3.04                (0.04)
Diluted earnings (loss) per common share (1)                 1.85                 3.01                (0.04)

Average total assets                                  $ 8,187,688          $ 7,533,016          $ 8,031,549
Average stockholders' equity                              749,549              795,841              838,239
Net income (loss) attributable to the Company/
Average total assets (ROA)                                   0.77  %              1.50  %             (0.02) %
Net income (loss) attributable to the Company /
Average stockholders' equity (ROE)                           8.45  %             14.19  %             (0.21) %

Average stockholders' equity / Average total assets
ratio                                                        9.15  %             10.56  %             10.44  %


__________________
(1)As of December 31, 2022 and 2021, potential dilutive instruments consisted of
unvested shares of restricted stock, restricted stock units and performance
stock units (unvested shares of restricted stock and restricted stock units as
of December 31, 2020). See Note 14 to our audited consolidated financial
statements in this Form 10-K for details on the dilutive effects of the issuance
of restricted stock, restricted stock units and performance share units on
earnings per share in 2022, 2021 and 2020.

In 2022, basic and diluted earnings per share decreased compared to 2021,
primarily as result of lower net income earned during the period. This was
partially offset by lower weighted average number of basic and diluted shares in
2022 compared to 2021, primarily as a result of our capital structure
optimization efforts. In 2021, basic and diluted earnings per share increased
compared to 2020, primarily as result of higher net income earned during the
period.

Capital Resources and Liquidity Management

Capital Resources



Stockholders' equity is influenced primarily by earnings, dividends, if any, and
changes in Accumulated Other Comprehensive Income or Loss ("AOCI" or "AOCL")
caused primarily by fluctuations in unrealized holding gains or losses, net of
taxes, on debt securities available for sale and derivative instruments. AOCI or
AOCL are not included for purposes of determining our capital for holding and
bank regulatory purposes.

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2022 compared to 2021



Stockholders' equity was $705.7 million as of December 31, 2022, a decrease of
$126.1 million, or 15.2%, compared to $831.9 million as of December 31, 2021.
This decrease was primarily driven by: (i) after-tax net unrealized holding
losses of $97.2 million from the change in the market value of debt securities
available for sale as a result of the increase of approximately 425 basis points
recorded in index market rates in 2022; (ii) an aggregate of $72.1 million of
Class A common stock repurchased in 2022, under the Class A repurchase programs
launched in 2021 and 2022; (iii) $12.2 million of dividends declared and paid by
the Company in 2022, and (iv) an after tax cumulative effect adjustment to
retained earnings as a result of CECL adoption of $13.9 million. These decreases
were partially offset by net income of $63.3 million in 2022.

Non-controlling Interest



The Company records net loss attributable to Non-controlling interests in its
condensed consolidated statement of operations equal to the percentage of the
economic or ownership interest retained in the interest of Amerant Mortgage, and
presents non-controlling interests as a component of stockholders' equity on the
consolidated balance sheets. Equity attributable to the non-controlling interest
was a net loss of $2.1 million as of December 31, 2022, compared to a net loss
of $2.6 million as of December 31, 2021. In 2022 and 2021, net loss attributable
to the non-controlling interest was approximately $1.3 million and $2.6 million,
respectively.

At December 31, 2022 and 2021, Non-controlling interest in Amerant Mortgage was
20% and 49%, respectively. On March 31, 2022, the Company contributed $1.5
million in cash to Amerant Mortgage, increasing its ownership interest to 57.4%
as of March 31, 2022 from 51% as of December 31, 2021. In addition, in the three
months ended June 30, 2022, the Company increased its ownership interest in
Amerant Mortgage to 80% from 57.4%. This change was the result of: (i) two
former principals of Amerant Mortgage surrendering their interest in Amerant
Mortgage to the Company, when they became full time employees of the Bank (the
"Transfer of Subsidiary Shares From Noncontrolling Interest"), and (ii) an
additional contribution made by the Company of $1 million, in cash, to Amerant
Mortgage in the three months ended June 30, 2022. As a result of the Transfer of
Subsidiary Shares From Noncontrolling Interest, the Company reduced its
additional paid-in capital by a total of $1.9 million with a corresponding
increase to the equity attributable to Noncontrolling Interest.

Common Stock Transactions



Clean-Up Merger. On November 17, 2021, the Company entered into an Agreement and
Plan of Merger (the "Merger Agreement"), between the Company and its
newly-created, wholly-owned subsidiary, Amerant Merger SPV Inc. ("Merger Sub"),
pursuant to which the Merger Sub would merge with and into the Company (the
"Clean-up Merger"), and on November 17, 2021, the Company filed articles of
merger (the "Articles of Merger") with the Florida Secretary of State. In
connection with the Clean-up Merger, Merger Sub merged with and into the Company
as of 12:01 a.m. on November 18, 2021 (the "Effective Time of the Clean-up
Merger"). The Clean-up Merger had been previously approved by the Company's
shareholders on November 15, 2021. Under the terms of the Clean-up Merger, each
outstanding share of Class B common stock was converted to 0.95 of a share of
Class A common stock without any action on the part of the holders of Class B
common stock; however, any shareholder, together with its affiliates, who owned
more than 8.9% of the outstanding shares of Class A common stock a result of the
Clean-up Merger, such holder's shares of Class A common stock or Class B common
stock, as the case may have been, was converted into shares of a new class of
Non-Voting Class A common stock, solely with respect to holdings that were in
excess of the 8.9% limitation. The terms of the Clean-up Merger included the
creation of a new class of Non-Voting Class A common stock.

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In addition, all shareholders who held fractional shares as a result of the
Clean-up Merger received a cash payment in lieu of such fractional shares.
Following the Clean-up Merger, any holder who beneficially owned fewer than 100
shares of Class A common stock received cash in lieu of Class A common stock. In
November 2021, the Company repurchased 281,725 shares of Class A Common Stock
that were cashed out in accordance with the terms of the Clean-up Merger. These
shares were repurchased at a price per share of $30.10 and an aggregate purchase
of approximately $8.5 million.

From and after the Effective Time of the Clean-up Merger, the separate corporate
existence of Merger Sub ceased and the Company continued as the surviving
corporation. In connection with the Clean-up Merger, the number of shares that
the Company is authorized to issue decreased by 250,000,000. As a result of the
Clean-up Merger, the Class B Common Stock is no longer authorized or
outstanding, and November 17, 2021 was the last day it traded on the Nasdaq
Global Select Market.

Common Stock Repurchases and cancellation of Treasury Shares.



On December 19, 2022, the Company announced that the Board of Directors
authorized a new repurchase program pursuant to which the Company may purchase,
from time to time, up to an aggregate amount of $25 million of its shares of
Class A common stock (the "2023 Class A Common Stock Repurchase Program"). The
2023 Class A Common Stock Repurchase Program is effective from January 1, 2023
until December 31, 2023.

On January 31, 2022, the Company announced that the Board of Directors
authorized a new repurchase program pursuant to which the Company may purchase,
from time to time, up to an aggregate amount of $50 million of its shares of
Class A common stock (the "New Class A Common Stock Repurchase Program"). In
2022, the Company repurchased an aggregate of 1,602,887 shares of Class A common
stock at a weighted average price of $31.14 per share, under the New Common
Stock Repurchase Program. The aggregate purchase price for these transactions
was approximately $49.9 million, including transaction costs. On May 19, 2022,
the Company announced the completion of the New Common Stock Repurchase Program.

In November 2021, the Company repurchased 281,725 shares of Class A Common Stock
that were cashed out in accordance with the terms of the Clean-up Merger. These
shares were repurchased at a weighted average price per share of $30.10 and an
aggregate purchase of approximately $8.5 million.

In September 2021, the Company's Board of Directors authorized a stock
repurchase program which provided for the potential to repurchase up to $50
million of shares of the Company's Class A common stock (the "Class A Common
Stock Repurchase Program"). In 2022 and 2021, the Company repurchased an
aggregate of 652,118 shares and 893,394 shares, respectively, of Class A common
stock at a weighted average price per share of $33.96 and $31.18, respectively,
under the Class A Common Stock Repurchase Program. In 2022 and 2021, the
aggregate purchase price for these transactions was approximately $22.1 million
and $27.9 million, respectively, including transaction costs. On January 31,
2022, the Company announced the completion of the Class A Common Stock
Repurchase Program.

On March 10, 2021, the Company's Board of Directors approved a stock repurchase
program which provided for the potential repurchase of up to $40 million of
shares of the Company's Class B common stock (the "Class B Common Stock
Repurchase Program"). In 2021, the Company repurchased an aggregate of 565,232
shares of Class B common stock at a weighted average price per share of $16.92,
under the Class B Common Stock Repurchase Program. The aggregate purchase price
for these transactions was approximately $9.6 million, including transaction
costs. In September 2021, in connection with the Clean-up Merger, The Company's
Board of Directors terminated the Class B Common Stock Repurchase Program.

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On December 23, 2020, the Company completed a modified "Dutch auction" tender
offer to purchase, for cash, up to $50.0 million of shares of its Class B common
stock. The tender offer was oversubscribed and, as result, we accepted tenders
to purchase 4,249,785 shares of Class B common stock in the tender offer, which
included an additional 2% of outstanding shares of Class B common stock as
permitted under the tender offer rules. The 4,249,785 shares of Class B common
stock were purchased at a price of $12.55 per share. The total purchase price
for this transaction was $54.1 million, including $0.8 million in related fees
and expenses.

On February 14 and February 21, 2020, the Company repurchased an aggregate of
932,459 shares of nonvoting Class B common stock in two privately negotiated
transactions (collectively, the "2020 Repurchase") for $16.00 per share of Class
B common stock. The aggregate purchase price for these transactions was
approximately $15.2 million, including $0.3 million in broker fees and other
expenses.The Company funded the 2020 Repurchase with available cash.

In 2022, 2021 and 2020, the Company's Board of Directors authorized the cancellation of all shares of Class A common stock and Class B common stock previously held as treasury stock, including all shares repurchased in 2022, 2021 and 2020. Therefore, The Company had no shares of common stock held in treasury stock at December 31, 2022, 2021 and 2020.



Dividends. On October 20, 2022, the Company's Board of Directors declared a cash
dividend of $0.09 per share of the Company's Class A common stock. The dividend
was paid on November 30, 2022 to shareholders of record at the close of business
on November 15, 2022. The aggregate amount in connection with this dividend was
$3.0 million.

On July 20, 2022, the Company's Board of Directors declared a cash dividend of
$0.09 per share of the Company's Class A common stock. The dividend was paid on
August 31, 2022 to shareholders of record at the close of business on August 17,
2022. The aggregate amount in connection with this dividend was $3.0 million.

On April 13, 2022, the Company's Board of Directors declared a cash dividend of
$0.09 per share of the Company's Class A common stock. The dividend was paid on
May 31, 2022 to shareholders of record at the close of business on May 13, 2022.
The aggregate amount in connection with this dividend was $3.0 million.

On January 19, 2022, the Company's Board of Directors declared a cash dividend
of $0.09 per share of the Company's Class A common stock. The dividend was paid
on February 28, 2022 to shareholders of record at the close of business on
February 11, 2022. The aggregate amount in connection with this dividend was
$3.2 million.

In 2021, the Company's Board of Directors declared a cash dividend of $0.06 per
share of the Company's Class A common stock. The dividend was paid on or before
January 15, 2022 to holders of record as of December 22, 2021. The aggregate
accrued payable amount recorded against retained earnings in 2021 in connection
with this dividend was $2.2 million.

Liquidity Management

Advances from the FHLB, other borrowings and borrowing capacity



At December 31, 2022 and 2021, the Company had $0.9 billion and $0.8 billion,
respectively, of outstanding advances from the FHLB. During the year ended
December 31, 2022, the Company repaid $1.0 billion of outstanding FHLB advances,
and borrowed of $1.1 billion from this source. This activity included: (i) the
repayment of approximately $530.0 million in callable FHLB advances, and
addition of $550.0 million in longer-term advances, to extend the duration of
this portfolio and lock-in fixed interest rates; (ii) the addition of $150.0
million in fixed-rate FHLB advances to support loan growth during the period,
and (iii) the repayment of $175.0 million of FHLB advances as we took advantage
of the increased market valuation of these instruments at time of repayment.

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At December 31, 2022 and 2021 advances from the FHLB had maturities through 2027
and 2030, respectively. At December 31, 2022, advances from the FHLB had fixed
interest rates ranging from 0.61% to 4.84% and, a weighted average rate of 2.45%
(fixed interest rates ranging from 0.62% to 1.73%, and a weighted average rate
of 1.03% at December 31, 2021). In addition, as of December 31, 2021, the
Company had $530 million (interest rate - from 0.62% to 0.97%) in advances from
the FHLB that are callable prior to maturity. There were no callable advances
from the FHLB as of December 31, 2022.

We had $1.7 billion, $1.4 billion and $1.3 billion of additional borrowing
capacity with the FHLB as of December 31, 2022, 2021 and 2020, respectively.
This additional borrowing capacity is determined by the FHLB. We also maintain
relationships in the capital markets with brokers and dealers to issue
FDIC-insured interest-bearing deposits, including certificates of deposits. We
also have available uncommitted federal funds credit lines with several banks,
and had $105.0 million of availability under these lines at December 31, 2021.
At December 31, 2022, we had no outstanding uncommitted federal funds lines with
banks.

There were no other borrowings as of December 31, 2022 and 2021.

Subordinated Notes



On March 9, 2022, the Company entered into a Subordinated Note Purchase
Agreement (the "Purchase Agreement") with the Company's wholly-owned subsidiary
Amerant Florida Bancorp Inc. (Amerant Florida Bancorp Inc. was merged with and
into the Company during the three months ended September 30, 2022), and
qualified institutional buyers pursuant to which the Company sold and issued
$30.0 million aggregate principal amount of its 4.25% Fixed-to-Floating Rate
Subordinated Notes due March 15, 2032. Net proceeds were $29.1 million, after
estimated direct issuance costs of approximately $0.9 million. Unamortized
direct issuance cost are deferred and amortized over the term of the
Subordinated Notes of 10 years. These Subordinated Notes are unsecured,
subordinated obligations of the Company and rank junior in right of payment to
all of the Company's current and future senior indebtedness. The Subordinated
Notes have been structured to qualify as Tier 2 capital of the Company for
regulatory capital purposes, and rank equally in right of payment to all of our
existing and future subordinated indebtedness. See Note 10 to audited
consolidated financial statements in this Form 10-K for more details.

Holding and Intermediate Holding Subsidiaries



We are a corporation separate and apart from the Bank and, therefore, must
provide for our own liquidity. Historically, our main source of funding has been
dividends declared and paid to us by the Bank. In addition, we issued the Senior
Notes in 2020 and Subordinated notes in 2022. Also, as a result of the Amerant
Florida Merger, the Company is now the obligor and guarantor on our junior
subordinated debt and the guarantor of the Senior Notes and Subordinated Notes.
The Company held cash and cash equivalents of $64.9 million as of December 31,
2022 and $23.8 million as of December 31, 2021, in funds available to service
its Senior Notes, Subordinated Notes and junior subordinated debt and for
general corporate purposes, as a separate stand-alone entity. Our former
subsidiary, Amerant Florida, which was an intermediate bank holding company and
the former obligor on our junior subordinated debt and the former guarantor of
the Senior Notes and Subordinated Notes, held cash and cash equivalents $6.3
million as of December 31, 2021, in funds available to service its junior
subordinated debt and for general corporate purposes, as a separate stand-alone
entity. See discussion below for more details on the Amerant Florida Merger.
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Amerant Florida Merger



On August 2, 2022, the Company completed an intercompany transaction of entities
under common control, pursuant to which the Company's wholly owned subsidiary,
Amerant Florida Bancorp Inc. ("Amerant Florida"), merged with and into the
Company, with the Company as sole survivor. In connection with the Amerant
Florida Merger, the Company assumed all assets and liabilities of Amerant
Florida, including its direct ownership of the Bank, the common capital
securities issued by the 5 trust subsidiaries, and the junior subordinated
debentures issued by Amerant Florida and related agreements. The Amerant Florida
Merger had no impact to the Company's consolidated financial condition and
results of operations. See Note 11 to our audited consolidated financial
statements on this Form 10-K, for additional information on the common capital
securities issued by the 5 trust subsidiaries, and the junior subordinated
debentures.

Subsidiary Dividends



There are statutory and regulatory limitations that affect the ability of the
Bank to pay dividends to the Company. These limitations exclude the effects of
AOCI. Management believes that these limitations will not affect the Company's
ability to meet its ongoing short-term cash obligations. See "Supervision and
Regulation" in this Form 10-K.

In January, March and April 2022, the Boards of Directors of the Bank and Amerant Florida approved the payment of cash dividends of $40 million, $40 million and $34 million, respectively on each date, by the Bank to Amerant Florida and in the same amounts by Amerant Florida to Amerant Bancorp.

In July 2021, the Boards of Directors of the Bank and Amerant Florida approved the payment of cash dividends from the Bank and Amerant Florida to Amerant Bancorp, and declared dividend payments of: (i) $40.0 million from Amerant Florida to Amerant Bancorp, and (ii) $30.0 million from the Bank to Amerant Florida.

Redemption of Junior Subordinated Debentures



On January 30, 2020, the Company redeemed all $26.8 million of its outstanding
8.90% trust preferred capital securities issued by Commercebank Capital Trust I
("Capital Trust I") at a redemption price of 100%. The Company simultaneously
redeemed all junior subordinated debentures held by Capital Trust I as part of
this redemption transaction. This redemption reduced total cash and cash
equivalents by $27.1 million, financial liabilities by $28.1 million, other
assets by $3.4 million, and other liabilities by $2.2 million at that date. In
addition, the Company recorded a charge of $0.3 million during the first quarter
of 2020 for the unamortized issuance costs. This redemption reduced the
Company's Tier 1 equity capital at that date by a net of $24.7 million and
pretax annual interest expense by $2.4 million.

Based on our current outlook, we believe that net income, advances from the FHLB, available other borrowings and any dividends paid to us by the Bank will be sufficient to fund liquidity requirements for the next twelve months.

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Regulatory Capital Requirements



We are subject to various regulatory capital requirements administered by the
Federal Reserve and OCC. Failure to meet regulatory capital requirements may
result in certain discretionary, and possible mandatory actions by regulators
that, if taken, could have a direct material effect on our business, financial
condition and results of operation. Under the federal capital adequacy rules and
the regulatory framework for "prompt corrective action", we must meet specific
capital guidelines that involve quantitative measures of our assets, liabilities
and certain off-balance sheet items as calculated for regulatory capital
purposes. Our capital amounts and classification are also subject to qualitative
judgments by the regulators, including anticipated capital needs. Supervisory
assessments of capital adequacy may differ significantly from conclusions based
solely upon the regulations' risk-based capital ratios. Quantitative measures
established by regulation to ensure capital adequacy require us to maintain
minimum CET1, Tier 1 leverage, Tier 1 risk-based capital and total risk-based
capital ratios.

The Basel III rules became effective for the Company and the Bank on January 1,
2015 with full compliance with all of the requirements being phased in by
January 1, 2019. The Company and the Bank opted to not include the AOCI in
computing regulatory capital. As of December 31, 2022, management believes that
the Company and the Bank meet all capital adequacy requirements to which they
are subject, and are well-capitalized. In addition, Basel III rules required the
Company and the Bank to hold a minimum capital conservation buffer of 2.50%. The
Company's capital conservation buffer at year end 2022 and 2021 was 4.4% and
6.6%, respectively, and therefore no regulatory restrictions exist under the
applicable capital rules on dividends or discretionary bonuses or other
payments. See -"Supervision and Regulation- Capital" for more information
regarding regulatory capital.

Our Company's consolidated regulatory capital amounts and ratios are presented in the following table:



                                                                         Required for Capital Adequacy               Regulatory Minimums To be Well
                                         Actual                                    Purposes                                    Capitalized
(in thousands, except
percentages)                  Amount               Ratio                 Amount                 Ratio                 Amount                 Ratio
December 31, 2022
Total capital ratio        $ 947,505                  12.39  %       $    611,733                  8.00  %       $     764,666                  10.00  %
Tier 1 capital ratio         833,078                  10.89  %            458,799                  6.00  %             611,733                   8.00  %
Tier 1 leverage ratio        833,078                   9.18  %            363,130                  4.00  %             453,913                   5.00  %
CET1 capital ratio           772,105                  10.10  %            344,100                  4.50  %             497,033                   6.50  %

December 31, 2021
Total capital ratio        $ 934,512                  14.56  %       $    513,394                  8.00  %       $     641,742                  10.00  %
Tier 1 capital ratio         862,962                  13.45  %            385,045                  6.00  %             513,394                   8.00  %
Tier 1 leverage ratio        862,962                  11.52  %            299,746                  4.00  %             374,683                   5.00  %
CET1 capital ratio           801,907                  12.50  %            288,784                  4.50  %             417,133                   6.50  %

December 31, 2020
Total capital ratio        $ 876,966                   13.96 %       $    502,463                  8.00  %       $     628,078                  10.00  %
Tier 1 capital ratio         798,033                   12.71 %            376,847                  6.00  %             502,463                   8.00  %
Tier 1 leverage ratio        798,033                   10.11 %            315,770                  4.00  %             394,713                   5.00  %
CET1 capital ratio           736,930                   11.73 %            282,635                  4.50  %             408,251                   6.50  %


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The Bank's consolidated regulatory capital amounts and ratios are presented in
the following table:

                                                                        Required for Capital Adequacy               Regulatory Minimums to be Well
                                        Actual                                    Purposes                                    Capitalized
(in thousands, except
percentages)                 Amount               Ratio                 Amount                 Ratio                 Amount                 Ratio
December 31, 2022
Total capital ratio       $ 923,113                  12.10  %       $    610,149                  8.00  %       $     762,686                  10.00  %
Tier 1 capital ratio        837,970                  10.99  %            457,612                  6.00  %             610,149                   8.00  %
Tier 1 leverage ratio       837,970                   9.27  %            361,655                  4.00  %             452,069                   5.00  %
CET1 capital ratio          837,970                  10.99  %            343,209                  4.50  %             495,746                   6.50  %

December 31, 2021
Total capital ratio       $ 957,852                  14.94  %       $    512,780                  8.00  %       $     640,976                  10.00  %
Tier 1 capital ratio        886,301                  13.83  %            384,585                  6.00  %             512,780                   8.00  %
Tier 1 leverage ratio       886,301                  11.84  %            299,466                  4.00  %             374,332                   5.00  %
CET1 capital ratio          886,301                  13.83  %            288,439                  4.50  %             416,634                   6.50  %

December 31, 2020
Total capital ratio       $ 873,152                  13.91  %       $    502,214                  8.00  %       $     627,768                  10.00  %
Tier 1 capital ratio        794,257                  12.65  %            376,661                  6.00  %             502,214                   8.00  %
Tier 1 leverage ratio       794,257                  10.07  %            315,569                  4.00  %             394,461                   5.00  %
CET1 capital ratio          794,257                  12.65  %            282,495                  4.50  %             408,049                   6.50  %



The Basel III Capital Rules revised the definition of capital and describe the
capital components and eligibility criteria for CET1 capital, additional Tier 1
capital and Tier 2 capital. See "Item 1. Business - Supervision and Regulation"
for detailed information. During 2020, the Company redeemed all $26.8 million of
its outstanding 8.90% trust preferred securities issued by Capital Trust I and
related junior subordinated debentures. See "Capital Resources and Liquidity
Management" for more detail on the redemption of trust preferred securities and
related junior subordinated debt.

During the first quarter of 2020, the Company adopted the simplified capital
rules for non-advanced approaches institutions with no material effect on the
Company's regulatory capital and ratios. In addition, as of March 31, 2020, the
Company determined to opt out of adopting the new community bank leverage ratio
framework given that the perceived benefits provided by the new regulation did
not exceed the potential costs considering the Company's current and projected
size and operations. See "Item.1 - Supervision and Regulation" for additional
information on the simplified capital rules and the community bank leverage
ratio framework.

In the fourth quarter of 2022, the Company adopted CECL. The Company has not
elected to apply an available three-year transition provision to its regulatory
capital computations as a result of its adoption of CECL in 2022. See Note 1 to
our audited annual consolidated financial statements in this Form 10-K for
details on the adoption of CECL.

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Effects of Inflation and Changing Prices



The consolidated financial statements and related consolidated financial data
presented herein have been prepared in accordance with GAAP and practices within
the banking industry, which require the measurement of financial position and
operating results in terms of historical Dollars without considering the changes
in the relative purchasing power of money over time due to inflation.

Unlike most industrial companies, virtually all the assets and liabilities of a
financial institution are monetary in nature. As a result, interest rates have a
more significant impact on a financial institution's performance than the
effects of general levels of inflation. However, inflation also affects a
financial institution by increasing its cost of goods and services purchased, as
well as the cost of salaries and benefits, occupancy expense, and similar items.
Inflation and related increases in interest rates generally decrease the market
value of investments and loans held and may adversely affect liquidity,
earnings, and shareholders' equity. Loan originations and re-financings also
tend to slow as interest rates increase, and higher interest rates may reduce a
financial institution's earnings from such origination activities. Similarly,
lower inflation and rate decreases increase the fair value of securities and
loan origination and refinancing tend to accelerate.

Off-Balance Sheet Arrangements



We may engage in a variety of financial transactions in the ordinary course of
business that, under GAAP, may not be recorded on the balance sheet. Those
transactions may include contractual commitments to extend credit in the
ordinary course of our business activities to meet the financing needs of
customers. Such commitments involve, to varying degrees, elements of credit,
market and interest rate risk in excess of the amount recognized in the balance
sheets. These commitments are legally binding agreements to lend money at
predetermined interest rates for a specified period of time and generally have
fixed expiration dates or other termination clauses. We use the same credit and
collateral policies in making these credit commitments as we do for on-balance
sheet instruments.

We evaluate each customer's creditworthiness on a case-by-case basis and obtain
collateral, if necessary, based on our credit evaluation of the borrower. In
addition to commitments to extend credit, we also issue standby letters of
credit that are commitments to a third-party in specified amounts of payment or
performance, if our customer fails to meet its contractual obligation to the
third-party. The credit risk involved in the underwriting of letters of credit
is essentially the same as that involved in extending credit to customers.

The following table shows the outstanding balance of our off-balance sheet
arrangements as of the end of the periods presented. Except as disclosed below,
we are not involved in any other off-balance sheet contractual relationships
that are reasonably likely to have a current or future material effect on our
financial condition, a change in our financial condition, revenues or expenses,
results of operations, liquidity, capital expenditures or capital resources.
                                                December 31,
(in thousands)                       2022            2021           2020

Commitments to extend credit     $ 1,165,701      $ 899,016      $ 763,880

Letters of credit                     20,726         32,107         11,157
                                 $ 1,186,427      $ 931,123      $ 775,037



Commitments to extend credit increased $266.7 million, or 29.7%, as of December
31, 2022 compared to December 31, 2021. This was mainly driven by an increase in
commercial and industrial loan commitments.

The Company uses interest rate swaps and other derivative instruments as part of
its normal business operations. See Footnote 12- Derivatives to our consolidated
financial statements for details.

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Contractual Obligations

In the normal course of business, we and our subsidiaries enter into various
contractual obligations that may require future cash payments. Significant
commitments for future cash obligations include capital expenditures related to
real estate and equipment operating leases and other borrowing arrangements.

The table below summarizes, by remaining maturity, our significant contractual
cash obligations as of December 31, 2022. Amounts in this table reflect the
minimum contractual obligation under legally enforceable contracts with terms
that are both fixed and determinable. All other contractual cash obligations on
this table are reflected in our consolidated balance sheet.

As of December 31, 2022, we had the following contractual cash obligations:



                                                                                       Payments Due Date
                                                          Less than one        One to three        Over three to        More than five
(in thousands)                          Total                 year                 years             five years             years

Operating lease obligations $ 247,731 $ 13,046


   $   26,196          $    26,740          $   181,749

Time deposits                         1,728,255             1,461,456             209,043               54,316                3,440
Borrowings:
FHLB advances                           910,000               305,000             555,000               50,000                    -
Senior notes                             60,000                     -              60,000                    -                    -
Subordinated notes                       30,000                     -                   -                    -               30,000
Junior subordinated debentures           64,178                     -                   -                    -               64,178
Contractual interest payments (1)       123,150                33,381              34,094               12,856               42,819
                                    $ 3,163,314          $  1,812,883          $  884,333          $   143,912          $   322,186


__________________

(1) Calculated assuming a constant interest rate as of December 31, 2022.



We believe that we will be able to meet our contractual obligations as they come
due through the maintenance of adequate liquidity. We expect to maintain
adequate liquidity through the results of operations, loan and securities
repayments and maturities and continued deposit gathering activities. We also
have various borrowing facilities at the Bank to satisfy both short-term and
long-term liquidity needs.

In December 2021, the Company became a strategic lead investor in the JAM FINTOP
Blockchain fund (the "Fund"). Our initial commitment was approximately
$5.4 million, or 4.9% of the total size of the Fund, and could reach
$9.8 million if the Fund increased to its maximum target size of $200 million.
The final closing for the Fund was on June 30, 2022, and the total commitment
was $161.6 million from the $200 million expected. Therefore, in 2022, our
capital commitment in the fund changed from $5.4 million to $7.9 million.


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Critical Accounting Policies and Estimates



The preparation of our consolidated financial statements in accordance with GAAP
requires us to make estimates and judgments that affect our reported amounts of
assets, liabilities, revenues and expenses and related disclosure of contingent
assets and liabilities. We base our estimates on historical experience and on
various other assumptions that are believed to be reasonable under current
circumstances, results of which form the basis for making judgments about the
carrying value of certain assets and liabilities that are not readily available
from other sources. We evaluate our estimates on an ongoing basis. Actual
results may differ from these estimates under different assumptions or
conditions.

Accounting policies, as described in detail in the notes to our consolidated
financial statements, are an integral part of our financial statements. A
thorough understanding of these accounting policies is essential when reviewing
our reported results of operations and our financial position. We believe that
the critical accounting policies and estimates discussed below require us to
make difficult, subjective or complex judgments about matters that are
inherently uncertain. Changes in these estimates, that are likely to occur from
period to period, or using different estimates that we could have reasonably
used in the current period, would have a material impact on our financial
position, results of operations or liquidity.

Securities. Securities generally must be classified as held to maturity, or
HTM, debt securities available-for-sale, or AFS, trading or, equity securities
with readily available fair values. Securities classified as HTM are securities
we have both the ability and intent to hold until maturity and are carried at
amortized cost, less any allowance for credit losses. Trading securities, if we
had any, would be held primarily for sale in the near term to generate income.
Debt securities that do not meet the definition of trading or HTM are classified
as AFS.

The classification of investment securities is significant since it directly
impacts the accounting for unrealized gains and losses on these securities.
Unrealized gains and losses on trading securities, if we had any, and equity
securities with readily available fair values, would flow directly through
earnings during the periods in which they arise. AFS securities are measured at
fair value each reporting period. Unrealized gains and losses on AFS securities
are recorded as a separate component of shareholders' equity (accumulated other
comprehensive income or loss) and do not affect earnings until realized or
deemed to be credit-impared. Investment securities that are classified as HTM
are recorded at amortized cost, and reduced by an estimated amount of expected
credit loss during the life of the investment, if any.

For debt securities available for sale, the Company evaluates whether: (i) the
fair value of the securities is less than the amortized costs basis; (ii) it
intends to sell, or it is more likely than not that it will be required to sell,
the security before recovery of its amortized cost basis, and (iii) the decline
in fair value has resulted from credit losses or other factors. The Company
estimates credit losses on debt securities available for sale using a discounted
cash flow model. The present value of an impaired debt security results from
estimating future cash flows that are expected to be collected, discounted at
the debt security's effective interest rate. The Company develops its estimates
about cash flows expected to be collected and determines whether a credit loss
exists, generally using information about past events, current conditions,
reasonable and supportable forecasts and other qualitative factors including the
extent to which fair value is less than amortized cost basis, adverse conditions
specifically related to the security, industry or geographic area, changes in
conditions of any collateral underlying the securities, changes in credit
ratings, failure of the issuer to make scheduled payments, among other
qualitative factors specific to the applicable security. If a credit loss
exists, the Company records an allowance for the credit losses, limited to the
amount by which the fair value is less than the amortized cost basis. The
Company recognizes in AOCI/AOCL any impairment that has not been recorded
through an allowance for credit losses.

Debt securities available for sale are charged off to the extent that there is
no reasonable expectation of recovery of amortized cost basis. Debt securities
available for sale are placed on non-accrual status if the Company does not
reasonably expect to receive interest payments in the future and interest
accrued is reversed against interest income. Securities are returned to accrual
status only when collection of interest is reasonably assured.

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Fair Value of Financial Instruments. We are, under applicable accounting
guidance, required to maximize the use of observable inputs and minimize the use
of unobservable inputs in measuring fair value. We classify fair value
measurements of financial instruments based on the three-level fair value
hierarchy in the guidance. We carry AFS debt and other securities, BOLI policies
and derivative assets and liabilities at fair value.

The fair values of assets and liabilities may include adjustments for various
factors, such as market liquidity and credit quality, where appropriate.
Valuations of products using models or other techniques are sensitive to
assumptions used for the significant inputs. Where market data is available, the
inputs used for valuation reflect that information as of our valuation date.
Inputs to valuation models are considered unobservable if they are supported by
little or no market activity. In periods of extreme volatility, lessened
liquidity or in illiquid markets, there may be more variability in market
pricing or a lack of market data to use in the valuation process. In keeping
with the prudent application of estimates and management judgment in determining
the fair value of assets and liabilities, we have in place various processes and
controls including validation controls, for which we utilize both broker and
pricing service inputs. Data from these services may include both
market-observable and internally-modeled values and/or valuation inputs. Our
reliance on this information is affected by our understanding of how the broker
and/or pricing service develops its data with a higher degree of reliance
applied to those that are more directly observable and lesser reliance applied
to those developed through their own internal modeling. Similarly, broker quotes
that are executable are given a higher level of reliance than indicative broker
quotes, which are not executable. These processes and controls are performed
independently of the business. For additional information, see Note 18 of our
audited consolidated financial statements.

Allowance for Credit Losses



In 2022, the Company adopted Accounting Standards Codification Topic 326 -
Financial Instruments - Credit Losses (ASC Topic 326), which replaced the
incurred loss methodology for estimated probable loan losses with an expected
credit loss methodology that is referred to as the current expected credit loss
("CECL") methodology. The Company adopted the CECL guidance as of the beginning
of the reporting period of adoption, January 1, 2022, using a modified
retrospective approach for all its financial assets measured at amortized cost
and off-balance sheet credit exposures.

Under the CECL accounting guidance, the Allowance for Credit Losses, or ACL, is
a valuation account that is deducted from the amortized cost basis of financial
assets, including loans held for investments and debt securities held to
maturity, to present the net amount that is expected to be collected throughout
the life of those financial assets. The estimated ACL is recorded through a
provision for credit losses charged against income. Management periodically
evaluates the adequacy of the ACL to maintain it at a level it believes to be
reasonable. The Company uses the same methods used to determine the ACL to
assess any reserves needed for off-balance sheet credit risks such as unfunded
loan commitments and contingent obligations on letters of credit. These reserves
for off-balance sheet credit risks are presented in the liabilities section in
the consolidated balance sheets.

The Company develops and documents its methodology to determine the ACL at the
portfolio segment level. The Company determines its loan portfolio segments
based on the type of loans it carries and their associated risk characteristics.
The measurement of expected credit losses considers information about historical
events, current conditions, reasonable and supportable forecasts and other
relevant information. Determining the amount of the ACL is complex and requires
extensive judgment by management about matters that are inherently uncertain.
Re-evaluation of the ACL estimate in future periods, in light of changes in
composition and characteristics of the loan portfolio, changes in the reasonable
and supportable forecast and other factors then prevailing may result in
material changes in the amount of the ACL and credit loss expense in those
future periods.

Expected credit losses are estimated on a collective basis for groups of loans
that share similar risk characteristics. Factors that may be considered in
aggregating loans for this purpose include but are not necessarily limited to,
product or collateral type, industry, geography, internal risk rating, credit
characteristics such as credit scores or collateral values, and historical or
expected credit loss patterns. For loans that do not share similar risk
characteristics with other loans such as collateral dependent loans and
modifications to borrowers experiencing financial difficulties, expected credit
losses are estimated on an individual basis.

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Expected credit losses are estimated over the contractual terms of the loans,
adjusted for expected prepayments. Expected prepayments for commercial and
commercial real estate loans are generally estimated based on the Company's
historical experience. For residential loans, expected prepayments are estimated
using a model that incorporates industry prepayment data, calibrated to reflect
the Company's experience. The contractual term excludes expected extensions,
renewals, and modifications unless either of the following applies: management
has a reasonable expectation at the reporting date a modification related to a
borrower experiencing financial difficulty will be executed, or the extension or
renewal options are included in the original or modified contract at the
reporting date and are not unconditionally cancellable by the Company.

With respect to modifications made to borrowers experiencing financial
difficulty, a change to the ACL is generally not recorded upon modification
since the effect of these modifications is already included in the ACL given the
measurement methodologies used to estimate the ACL. From time to time, the
Company modifies loans by providing principal forgiveness on certain of its real
estate loans. When principal forgiveness is provided, the amortized cost basis
of the asset is written off against the ACL. The amount of the principal
forgiveness is deemed to be uncollectible; therefore, that portion of the loan
is written off, resulting in a reduction of the amortized cost basis and a
corresponding adjustment to the ACL.

For the largest portfolio segments, including commercial and commercial real
estate loans, expected credit losses are estimated using probability of default
("PD") and loss given default ("LGD") bottom-up approach, which derives the
expected losses from borrower's and market or industry specific risk
characteristics. For smaller-balance homogeneous loans with similar risk
characteristics, including residential, consumer and small business loans, the
models estimate lifetime loan losses based on the portfolio's historical
behavior. In order to incorporate forward-looking expectations, the ACL for
these portfolios is adjusted based on macroeconomic factors proven to have
effects on the performance of the credit quality of each respective portfolio.
The models incorporate a probability-weighted blend of macroeconomic scenarios
by ingesting numerous national, regional and metropolitan statistical area
("MSA") level variables and data points. Some of the more impactful include both
current and forecasted unemployment rates, home price index, CRE property
forecasts, stock market and market volatility indices, real gross domestic
product growth, and a variety of interest rates and spreads. The macroeconomic
forecast process is complex and varies from period to period and therefore may
results in increased volatility in the ACL and earnings.

All loss estimates are conditioned as applicable on changes in current
conditions and the reasonable and supportable economic forecast. Additionally,
the Company makes qualitative adjustments to the ACL when, based on management's
judgment, there are factors impacting expected credit losses not taken into
account by the quantitative calculations. Potential qualitative adjustments
include economic factors, including material trends and developments that, in
management's judgment, may not have been considered in the reasonable and
supportable economic forecast, credit policy and staffing, including the nature
and level of policy and procedural exceptions or changes in credit policy not
reflected in quantitative results, changes in the quality of underwriting and
portfolio management and staff and issues identified by credit review, internal
audit or regulators that may not be reflected in quantitative results,
concentrations, considering whether the quantitative estimate adequately
accounts for concentration risk in the portfolio, model imprecision and model
validation findings; and other factors not adequately considered in the
quantitative estimate or other qualitative categories identified by management
that may materially impact the amount of expected credit losses.

The Company expects to collect the amortized cost basis of government insured
residential loans due to the nature of the government guarantee and, therefore
generally have no expected credit losses.

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Expected credit losses on loans to borrowers that are domiciled in foreign
countries, primarily loans in the Consumer and Financial Institutions portfolios
are generally estimated by assessing the any available cash or other types of
collateral, and the probability of losses arising from the Company's exposure to
those collateral assets. Loans in this portfolio are generally fully
collateralized with cash, securities and other assets and, therefore, generally
have no expected credit losses.

Commercial real estate, commercial and financial institution loans are charged
off against the ACL when they are considered uncollectable. These loans are
considered uncollectable when a loss becomes evident to management, which
generally occurs when the following conditions are present, among others: (1) a
loan or portions of a loan are classified as "loss" in accordance with the
internal risk grading system; (2) a collection attorney has provided a written
statement indicating that a loan or portions of a loan are considered
uncollectible; and (3) the carrying value of a collateral-dependent loan exceeds
the appraised value of the asset held as collateral. Consumer and other retail
loans are charged off against the ACL at the earlier of (1) when management
becomes aware that a loss has occurred, or (2) beginning effectiev as of
December 31, 2022, when closed-end retail loans become past due 90 days (120
previously) or open-end retail loans become past due 180 days from the
contractual due date. For open and closed-end retail loans secured by
residential real estate, any outstanding loan balance in excess of the fair
value of the property, less cost to sell, is charged off no later than when the
loan is 180 days past due from the contractual due date. Consumer and other
retail loans may not be charged off when management can clearly document that a
past due loan is well secured and in the process of collection such that
collection will occur regardless of delinquency status in accordance with
regulatory guidelines applicable to these types of loans.

Recoveries on loans represent collections received on amounts that were
previously charged off against the ACL. Recoveries are credited to the ACL when
received, to the extent of the amount previously charged off against the ACL on
the related loan. Any amounts collected in excess of this limit are first
recognized as interest income, then as a reduction of collection costs, and then
as other income.

While most of the measures and restrictions enacted during the COVID-19 pandemic
have been lifted, and businesses reopened, generally. the Company cannot predict
when circumstances may change and whether restrictions that have been lifted
will need to be imposed or tightened in the future if viewed as necessary due to
public health concerns. Given the uncertainty regarding the spread and severity
of the COVID-19 pandemic and its adverse effects on the U.S. and global
economies, the impact to the Company's loan portfolio cannot be accurately
predicted at this time. Additionally, in late September 2022, the Hurricane,
which impacted several countries in the Caribbean, and the U.S., caused
significant damage, and disrupting businesses in several regions, including
several South and Central Florida counties in which the Company does business,
including the Tampa Bay, Port Charlotte, Naples and Orlando markets and their
surrounding areas. See - "Hurricane Ian" in "Item1- Business" for more
information about the Hurricane. The Company has not identified any significant
impacts to the loan portfolio of the Company deemed to be located in the areas
that may have been meaningfully impacted by the Hurricane, and the Company has
not identified any significant impact to the collateral securing the loans in
the exposed loan portfolio in the region. The Company has been in contact with
the impacted borrowers and has been performing site visits as well. Since there
is significant uncertainty with respect to the full extent of the negative
impacts due to the unprecedented nature of the Hurricane, the Company's
estimates with respect to the loan portfolio potentially impacted and the ACL
currently estimable, are based on judgment and subject to change as conditions
evolve. The Company will continue to carefully assess and review the exposure of
the portfolios to hurricane-related factors, economic trends and their effect on
credit quality and that assessment and review could result in further provision
for credit losses in future periods.

Goodwill. Goodwill is evaluated for impairment at least annually and on an
interim basis if an event or circumstance indicates that it is likely an
impairment has occurred. We have applied significant judgment for annual
goodwill impairment testing purposes. Based on this evaluation, we concluded
goodwill was not considered impaired as of December 31, 2022. Future negative
changes may result in potential impairments in future periods.

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Determining the fair value of the reporting unit to which goodwill is allocated
to (the Company as a whole since we report using a single-segment concept) is
considered a critical accounting estimate because it requires significant
management judgment and the use of subjective measurements. Variability in the
market and changes in assumptions or subjective measurements used to determine
fair value are reasonably possible and may have a material impact on our
financial position, liquidity or results of operations.

Deferred Income Taxes. We use the balance sheet method of accounting for income
taxes as prescribed by GAAP. Under this method, DTAs and deferred tax
liabilities, or DTLs, are recognized for the future tax consequences
attributable to differences between the financial statement carrying amounts of
existing assets and liabilities and their respective tax bases. If current
available information raises doubt as to the realization of the DTAs a valuation
allowance is established. DTAs and DTLs are measured using enacted tax rates
expected to apply to taxable income in the years in which those temporary
differences are expected to be recovered or settled. Accounting for deferred
income taxes is a critical accounting estimate because we exercise significant
judgment in evaluating the amount and timing of recognition of the resulting tax
assets and liabilities. Management's determination of the realization of DTAs is
based upon management's judgment of various future events and uncertainties,
including the timing and amount of future income, reversing temporary
differences which may offset, and the implementation of various tax plans to
maximize realization of the DTAs. These judgments and estimates are inherently
subjective and reviewed on a continual basis as regulatory and business factors
change. Any reduction in estimated future taxable income may require us to
record a valuation allowance against our DTAs. A DTA valuation allowance would
result in additional income tax expense in such period, which would negatively
affect earnings. Conversely, the reversal of a valuation allowance previously
recorded against a DTA would result in lower tax expense.

Recently Issued Accounting Pronouncements. We have evaluated new accounting
pronouncements that have recently been issued and have determined that certain
of these new accounting pronouncements should be described in this section
because, upon their adoption, there could be a significant impact to our
operations, financial condition or liquidity in future periods. In the fourth
quarter of 2022, the Company adopted new accounting guidance on current expected
credit losses, or CECL with retroactive application as of January 1, 2022, the
beginning of the adoption period. Please refer to Note 1 of our audited
consolidated financial statements in this Form-10K for a detailed discussion of
CECL and other recently issued accounting pronouncements that have been adopted
by us that will require enhanced disclosures in our financial statements in
future periods.
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Latest news about Amerant Bancorp Inc.

Transcript : Amerant Bancorp Inc., Q1 2024 Earnings Call, Apr 25, 2024	Apr. 25
Earnings Flash (AMTB) AMERANT BANCORP Posts Q1 EPS $0.32, vs. Street Est of $0.38	Apr. 24	MT
Amerant Bancorp Inc. Reports Earnings Results for the First Quarter Ended March 31, 2024	Apr. 24	CI
Tranche Update on Amerant Bancorp Inc.'s Equity Buyback Plan announced on December 19, 2022.	Apr. 24	CI
Amerant Bancorp Inc. Declares Cash Dividend, Payable on May 30, 2024	Apr. 24	CI
Amerant Bancorp Selling 6 Branches in Houston to MidFirst Bank	Apr. 17	MT
Transcript : Amerant Bancorp Inc., MidFirst Bank - M&A Call	Apr. 17
North American Morning Briefing : Cautious Start -2-	Jan. 29	DJ
Keefe, Bruyette & Woods Adjusts Price Target on Amerant Bancorp to $28 From $27, Maintains Market Perform Rating	Jan. 26	MT
Piper Sandler Downgrades Amerant Bancorp to Neutral From Overweight	Jan. 26	MT
Transcript : Amerant Bancorp Inc., Q4 2023 Earnings Call, Jan 25, 2024	Jan. 25
Earnings Flash (AMTB) AMERANT BANCORP Posts Q4 EPS $0.46, vs. Street Est of $0.44	Jan. 24	MT
Tranche Update on Amerant Bancorp Inc.'s Equity Buyback Plan announced on December 19, 2022.	Jan. 24	CI
Amerant Bancorp Inc. Reports Earnings Results for the Full Year Ended December 31, 2023	Jan. 24	CI
Amerant Bancorp Inc. Reports Earnings Results for the Fourth Quarter Ended December 31, 2023	Jan. 24	CI
North American Morning Briefing : S&P 500 Futures Point to Fresh Record on Netflix Results	Jan. 24	DJ
Amerant Bancorp Keeps Quarterly Dividend at $0.09 a Share, Payable Feb. 29 to Shareholders of Record on Feb. 14	Jan. 18	MT
Amerant Bancorp Inc. Declares Cash Dividend, Payable on February 29, 2024	Jan. 18	CI
Amerant Bancorp Inc.'s Equity Buyback Plan Extended till December 31, 2024.	Dec. 05	CI
Amerant Bancorp Inc. Reports Earnings Results for the Third Quarter and Nine Months Ended September 30, 2023	23-10-27	CI
Raymond James Adjusts Amerant Bancorp's Price Target to $23 From $24, Keeps Outperform Rating	23-10-23	MT
Transcript : Amerant Bancorp Inc., Q3 2023 Earnings Call, Oct 20, 2023	23-10-20
Tranche Update on Amerant Bancorp Inc.'s Equity Buyback Plan announced on December 19, 2022.	23-10-19	CI
Amerant Bancorp Maintains Quarterly Dividend at $0.09 a Share, Payable Nov. 30 to Shareholders of Record on Nov. 14	23-10-19	MT
Amerant Bancorp Inc. Declares Dividend, Payable on November 30, 2023	23-10-19	CI

Chart Amerant Bancorp Inc.

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Company Profile

Amerant Bancorp Inc. is a bank holding company. It operates through its subsidiary, Amerant Bank, N.A. (the Bank). It provides individuals and businesses with a comprehensive array of deposit, credit, investment, wealth management, retail banking, mortgage services and fiduciary services. It offers a variety of trust and estate planning products and services catering to high-net-worth customers, its trust and estate planning products include simple and complex trusts, private foundations, personal investment companies and escrow accounts. It offers a full suite of online banking services including online account opening for domestic and international customers, access to account balances, statements, and other documents, Zelle for consumer and businesses, online transfers, online bill payment and electronic delivery of customer statements, as well as automated teller machines (ATMs), and banking by mobile devices, telephone, and mail. It also offers overdraft protection program.

Sector

Banks

Calendar

2024-07-16 - Q2 2024 Earnings Release (Projected)

Related indices

Russell 2000

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Ratings for Amerant Bancorp Inc.

Trading Rating

Investor Rating

ESG Refinitiv

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Analysts' Consensus

Sell

Buy

Mean consensus

HOLD

Number of Analysts

Last Close Price

22.07 USD

Average target price

25 USD

Spread / Average Target

+13.28%

Consensus

EPS Revisions

Estimates Revisions

Quarterly earnings - Rate of surprise

Company calendar

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