Fourth quarter net income of $29.6 million, $0.68 diluted earnings per share;

Full year net income of $107.9 million, $2.67 diluted earnings per share

Byline Bancorp, Inc. (NYSE:BY), today reported:

			For the quarter					Full Year Highlights
		4Q23		3Q23		4Q22		Full Year Highlights
Financial Results (in thousands)								• Net income increased $20.1 million, or 22.9%
	Net interest income	$	86,285	$	92,452	$	76,604
	Non-interest income		14,503		12,376		11,455	• Positive operating leverage of 6.1%
	Total Revenue⁽¹⁾		100,788		104,828		88,059	driven by 28.0% increase in PTPP
	Non-interest expense		53,584		57,891		50,500
	Pre-tax pre-provision net income (PTPP)⁽¹⁾		47,204		46,937		37,559	• Net interest income up $65.3 million,
	Provision for credit losses		7,235		8,803		5,826	or 24.6%; NIM up 31 bps to 4.31%
	Provision for income taxes		10,365		9,912		7,366
	Net Income	$	29,604	$	28,222	$	24,367	• Assets increased by $1.5 billion, through
								organic growth and Inland acquisition
Per Share
	Diluted EPS	$	0.68	$	0.65	$	0.65	4Q23 Income Statement Highlights
	Dividends declared per common share		0.09		0.09		0.09	• Adjusted net income⁽¹⁾ of $31.8 million,
	Book value per share		22.62		21.04		20.43	or $0.73 per adjusted diluted share⁽¹⁾
	Tangible book value per share⁽¹⁾		17.98		16.35		16.19
								• Record PTPP⁽¹⁾ of $47.2 million
Balance Sheet & Credit Quality
	Total deposits	$	7,176,999	$	6,953,690	$	5,695,121	• Adjusted efficiency ratio⁽¹⁾ of 48.64%
	Total loans and leases		6,702,311		6,620,602		5,469,081
	Net charge-offs		12,186		5,430		3,179	4Q23 Balance Sheet Highlights
	Allowance for credit losses (ACL)		101,686		105,696		81,924	• Deposit growth of $223.3 million, or 12.7%⁽²⁾
	ACL to total loans and leases held for investment		1.52%		1.60%		1.51%
								• Loan growth of $81.7 million, or 4.9%⁽²⁾
Select Ratios
	Efficiency ratio⁽¹⁾		51.63%		53.75%		55.53%	• Loan/deposit ratio of 93.39%, down 182 bps
	Return on average assets (ROAA)		1.34%		1.30%		1.33%
	Return on average stockholders' equity		12.56%		12.11%		12.92%	• Reduced reliance on Brokered CDs and FHLB
	Return on average tangible common equity⁽¹⁾		16.68%		16.15%		17.21%	advances, down $384.1 million
	Net Interest Margin (NIM)		4.08%		4.46%		4.39%
	Common equity to total assets		11.15%		10.29%		10.40%	• Common equity to assets of 11.15%;
	Tangible common equity to tangible assets⁽¹⁾		9.06%		8.18%		8.42%	TCE/TA⁽¹⁾ of 9.06%, up 88 bps
	Common Equity Tier 1		10.35%		10.08%		10.20%

(1)	Represents non-GAAP financial measures. See "Reconciliation of non-GAAP Financial Measures" for a reconciliation to the most directly comparable GAAP financial measure.
(2)	Annualized

CEO/President Commentary

Roberto R. Herencia, Executive Chairman and CEO of Byline Bancorp, commented, "During 2023, we completed a number of strategic initiatives, including the successful merger and integration of Inland Bancorp, Inc. and delivered sound fourth quarter and strong full-year financial results. We were able to meet the needs of our customers and the markets we serve as total deposits increased $1.5 billion and total loans and leases increased $1.2 billion during the year. This stable balance sheet growth helped us achieve the highest level of revenue in Byline's history. We enter 2024 on solid footing and with great momentum to continue growing the value of our franchise."

Alberto J. Paracchini, President of Byline Bancorp, added, "We are pleased to end the year delivering strong earnings, balanced deposit and loan and lease growth, robust profitability, and disciplined expense management. We remain resolute in serving our customers' financial needs while diligently focusing on maintaining our asset quality, capital and liquidity positions. I want to thank everyone who works at Byline for their dedication, talent, and contributions to another successful year."

Board Authorizes New Stock Repurchase Program

On December 6, 2023, the Company's Board of Directors approved a new stock repurchase program that authorizes the Company to purchase up to 1.25 million shares of the Company's outstanding common stock. The new program is effective January 1, 2024 until December 31, 2024. Under the previous stock repurchase program that expired on December 31, 2023, the Company did not repurchase any shares during 2023.

Board Declares Cash Dividend of $0.09 per Share

On January 23, 2024, the Company's Board of Directors declared a cash dividend of $0.09 per share, payable on February 20, 2024, to stockholders of record of the Company's common stock as of February 6, 2024.

STATEMENTS OF OPERATIONS HIGHLIGHTS

Net Interest Income

Net interest income for the fourth quarter of 2023 was $86.3 million, a decrease of $6.2 million, or 6.7%, from the third quarter of 2023. The decrease in net interest income was primarily due to an increase of $6.1 million in deposit interest expense due to growth and higher rates, and a decrease of $1.4 million in interest income and fees on loans and leases mainly due to lower accretion income on acquired loans of $5.2 million, offset by growth.

Tax-equivalent net interest margin⁽¹⁾ for the fourth quarter of 2023 was 4.09%, a decrease of 38 basis points compared to the third quarter of 2023. Total net loan accretion income impact on the margin contributed 24 basis points to the net interest margin for the current quarter compared to 50 basis points for the prior quarter.

The average cost of total deposits was 2.42% for the fourth quarter of 2023, an increase of 29 basis points compared to the third quarter of 2023, as a result of higher rates on money market accounts and time deposits. Average non-interest-bearing demand deposits were 27.5% of average total deposits for the current quarter compared to 28.8% during the prior quarter.

Net interest income for the year ended December 31, 2023 was $330.6 million, an increase of $65.3 million, or 24.6%, from the year ended December 31, 2022. The increase in net interest income was primarily due to an increase of $167.6 million in interest income and fees on loans and leases due to growth and accretion income on acquired loans; partially offset by an increase of $101.6 million in deposit interest expense due to higher rates paid and growth.

Tax-equivalent net interest margin⁽¹⁾ for the year ended December 31, 2023 was 4.32%, an increase of 31 basis points compared to year ended December 31, 2022. Total net loan accretion income impact on the margin contributed 22 basis points to the net interest margin for the current year compared to seven basis points for the prior year.

The average cost of total deposits was 1.90% for the year ended December 31, 2023, an increase of 154 basis points compared to the year ended December 31, 2022, as a result of higher rates on money market accounts and time deposits. Average non-interest-bearing demand deposits were 30.7% of average total deposits for the current year compared to 40.4% during the prior year.

Provision for Credit Losses

The provision for credit losses was $7.2 million for the fourth quarter of 2023, a decrease of $1.6 million compared to $8.8 million for the third quarter of 2023, mainly attributed to a $2.7 million provision allocated for the acquired non-credit-deteriorated loans resulting from acquisition accounting taken in the prior quarter, partially offset by impairments on non-performing loans. The provision for credit losses for the current quarter is comprised of a provision for loan and lease losses of $8.2 million and a recapture for unfunded commitments of $940,000.

The provision for credit losses was $31.7 million for the year ended December 31, 2023, an increase of $7.8 million compared to $23.9 million for the year ended December 31, 2022, mainly attributed to an increase in non-performing loans and acquired non-credit-deteriorated loans. The provision for credit losses for the current year is comprised of a provision for loan and lease losses of $32.2 million and a recapture for unfunded commitments of $567,000.

(1)	Represents non-GAAP financial measures. See "Reconciliation of non-GAAP Financial Measures" for a reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measure.

Non-interest Income

Non-interest income for the fourth quarter of 2023 was $14.5 million, an increase of $2.1 million, or 17.2%, compared to $12.4 million for the third quarter of 2023. The increase in total non-interest income was primarily due to a $2.4 million decrease in the downward valuation of the loan servicing asset reflecting lower discount rate and improved secondary market conditions, and a $1.2 million gain on the change in fair value of equity securities, partially offset by a decrease of $993,000 in the net gains on sales of loans due to a lower volume of loans sold. During the fourth quarter of 2023, we sold $89.1 million of U.S. government guaranteed loans compared to $101.1 million during the third quarter of 2023.

Non-interest income for the year ended December 31, 2023 was $56.3 million, a decrease of $1.0 million, or 1.7%, compared to $57.3 million for the year ended December 31, 2022. The decrease in total non-interest income was primarily due to a decrease in net gains on sales of loans of $9.1 million, partially offset by a $6.7 million decrease in the downward valuation on the loan servicing asset, reflecting a lower discount rate and improved secondary market conditions. During the current year, we sold $348.4 million of U.S. government guaranteed loans compared to $382.2 million during the prior year.

Non-interest Expense

Non-interest expense for the fourth quarter of 2023 was $53.6 million, a decrease of $4.3 million, or 7.4%, from $57.9 million for the third quarter of 2023. The decrease in total non-interest expense was mainly due to a decrease of $3.0 million in salaries and employee benefits, and decreases of $1.5 million in both data processing and legal, audit and other professional, primarily driven by merger-related expenses taken in the third quarter.

Our efficiency ratio was 51.63% for the fourth quarter of 2023 compared to 53.75% for the third quarter of 2023, an improvement of 212 basis points. Excluding significant items, our adjusted efficiency ratio⁽¹⁾ for the fourth quarter 2023 was 48.64%, compared to 47.35% for the third quarter of 2023.

Non-interest expense for the year ended December 31, 2023 was $209.6 million, an increase of $25.5 million, or 13.9%, from $184.1 million for the year ended December 31, 2022. The increase in total non-interest expense was mainly due to the Inland acquisition.

Our efficiency ratio was 52.62% for the year ended December 31, 2023 compared to 54.99% for the year ended December 31, 2022, an improvement of 237 basis points. Excluding significant items, our adjusted efficiency ratio⁽¹⁾ for the current year was 49.61%, compared to 54.70% for the prior year.

Income Taxes

We recorded income tax expense of $10.4 million during the fourth quarter of 2023, compared to $9.9 million during the third quarter of 2023. The effective tax rate was 25.9% and 26.0% for the fourth quarter of 2023 and third quarter of 2023, respectively.

We recorded income tax expense of $37.8 million during the year ended December 31, 2023, compared to $26.7 million during the year ended December 31, 2022. The effective tax rate was 25.9% and 23.3% for the current year and prior year, respectively.

(1)	Represents non-GAAP financial measures. See "Reconciliation of non-GAAP Financial Measures" for a reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measure.

STATEMENTS OF FINANCIAL CONDITION HIGHLIGHTS

Assets

Total assets were $8.9 billion as of December 31, 2023, a decrease of $61.4 million, or 0.7%, compared to $8.9 billion at September 30, 2023 and an increase of $1.5 billion from $7.4 billion at December 31, 2022.

The current quarter decrease was primarily due to a decrease in cash and cash equivalents of $202.8 million due to cash management strategies, offset by an increase in net loans and leases of $75.0 million mainly due to the increases in commercial banking and lease financings, and an increase in securities available-for-sale of $102.6 million, driven by an increase in fair values. The increase from the prior year is primarily due to the Inland acquisition and organic loan and lease growth.

Non-performing loans and leases were $64.1 million at December 31, 2023, an increase of $12.0 million from $52.1 million at September 30, 2023, and $28.0 million from $36.0 million at December 31, 2022. The increases were primarily the result of increases to purchased credit deteriorated loans and increases in non-performing commercial real estate loans and commercial and industrial loans.

Allowance for Credit Losses ("ACL") - Loans and Leases

The ACL was $101.7 million as of December 31, 2023, a decrease of $4.0 million, or 3.8%, from $105.7 million at September 30, 2023, mainly due to net charge-offs. The ACL increase of $19.8 million from $81.9 million as of December 31, 2022 is mainly due to loan growth, adjustment for acquired purchase credit deteriorated loans, and an increase in non-performing loans.

Net charge-offs of loans and leases during the fourth quarter of 2023 were $12.2 million, or 0.73% of average loans and leases, on an annualized basis. This was an increase of $6.8 million compared to net charge-offs of $5.4 million, or 0.33% of average loans and leases, during the third quarter of 2023. Increases in the current quarter are primarily due to the resolution of impaired commercial and industrial loans and commercial real estate loans.

Net charge-offs of loans and leases during the year ended December 31, 2023 were $23.1 million, or 0.38% of average loans and leases. This was an increase of $15.1 million compared to net charge-offs of $7.9 million, or 0.16% of average loans and leases, during the year ended December 31, 2022. Increases for the full year were mainly driven by resolutions on purchased credit deteriorated loans and commercial real estate loans.

Deposits and Other Liabilities

Total deposits increased $223.3 million to $7.2 billion at December 31, 2023 compared to $7.0 billion at September 30, 2023 and $5.7 billion as of December 31, 2022. The increase in deposits in the current quarter was mainly due to organic growth. Time deposit growth of $127.2 million was principally due to increased personal time deposits. Money market growth of $203.8 million was due to increases in consumer and commercial deposits. Non-interest-bearing demand deposits decreased $54.0 million primarily due to lower consumer deposits. Increases for the full year were primarily driven by the Inland acquisition and organic deposit growth, and were impacted by shifting deposit mix due to the rising interest rate environment.

Total borrowings and other liabilities were $714.8 million at December 31, 2023, a decrease of $354.8 million from $1.1 billion at September 30, 2023, and a decrease of $187.0 million from $902.0 million at December 31, 2022. These decreases were primarily driven by lower Federal Home Loan Bank advances.

Stockholders' Equity

Total stockholders' equity was $990.2 million at December 31, 2023, increase of $70.2 million from $919.9 million at September 30, 2023, and an increase of $224.5 million from December 31, 2022. The quarterly increase was primarily due to increases in other comprehensive income and retained earnings as a result of net income. The full year increase was primarily due to merger consideration and retained earnings as a result of net income.

(1)	Represents non-GAAP financial measures. See "Reconciliation of non-GAAP Financial Measures" for a reconciliation of our non-GAAP measures to the most directly comparable GAAP financial measure.

Conference Call, Webcast and Slide Presentation

We will host a conference call and webcast at 9:00 a.m. Central Time on Friday, January 26, 2024, to discuss our quarterly financial results. Analysts and investors may participate in the question-and-answer session. The call can be accessed via telephone at (833) 470-1428; passcode 183253. A recorded replay can be accessed through February 9, 2024, by dialing (866) 813-9403; passcode: 953063.

A slide presentation relating to our fourth quarter 2023 results will be accessible prior to the conference call. The slide presentation and webcast of the conference call can be accessed on our investor relations website at www.bylinebancorp.com.

About Byline Bancorp, Inc.

Headquartered in Chicago, Byline Bancorp, Inc. is the parent company of Byline Bank, a full service commercial bank serving small- and medium-sized businesses, financial sponsors, and consumers. Byline Bank has approximately $8.9 billion in assets and operates 48 branch locations throughout the Chicago and Milwaukee metropolitan areas. Byline Bank offers a broad range of commercial and community banking products and services including small ticket equipment leasing solutions and is one of the top Small Business Administration lenders in the United States.

Forward-Looking Statements

This communication contains forward-looking statements within the meaning of the U.S. federal securities laws. Forward-looking statements include, without limitation, statements concerning plans, estimates, calculations, forecasts and projections with respect to the anticipated future performance of the Company. These statements are often, but not always, made through the use of words or phrases such as ‘‘may'', ‘‘might'', ‘‘should'', ‘‘could'', ‘‘predict'', ‘‘potential'', ‘‘believe'', ‘‘expect'', ‘‘continue'', ‘‘will'', ‘‘anticipate'', ‘‘seek'', ‘‘estimate'', ‘‘intend'', ‘‘plan'', ‘‘projection'', ‘‘would'', ‘‘annualized'', "target" and ‘‘outlook'', or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. Forward-looking statements involve estimates and known and unknown risks, and reflect various assumptions and involve elements of subjective judgment and analysis, which may or may not prove to be correct, and which are subject to uncertainties and contingencies outside the control of Byline and its respective affiliates, directors, employees and other representatives, which could cause actual results to differ materially from those presented in this communication.

No representations, warranties or guarantees are or will be made by Byline as to the reliability, accuracy or completeness of any forward-looking statements contained in this communication or that such forward-looking statements are or will remain based on reasonable assumptions. You should not place undue reliance on any forward-looking statements contained in this communication.

Certain risks and important factors that could affect Byline's future results are identified in our Annual Report on Form 10-K and other reports we file with the Securities and Exchange Commission, including among other things under the heading "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2022. Any forward-looking statement speaks only as of the date on which it is made, and Byline undertakes no obligation to update any forward-looking statement, whether to reflect events or circumstances after the date on which the statement is made, to reflect new information or the occurrence of unanticipated events, or otherwise unless required under the federal securities laws.

BYLINE BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION (unaudited)

	December 31,			September 30,			December 31,
(dollars in thousands)	2023			2023			2022
ASSETS
Cash and due from banks	$	60,431		$	71,248		$	62,274
Interest bearing deposits with other banks		165,705			357,640			117,079
Cash and cash equivalents		226,136			428,888			179,353
Equity and other securities, at fair value		8,743			7,902			7,989
Securities available-for-sale, at fair value		1,342,480			1,239,929			1,174,431
Securities held-to-maturity, at amortized cost		1,157			1,157			2,705
Restricted stock, at cost		16,304			30,505			28,202
Loans held for sale		18,005			7,299			47,823
Loans and leases:
Loans and leases		6,684,306			6,613,303			5,421,258
Allowance for credit losses - loans and leases		(101,686	)		(105,696	)		(81,924	)
Net loans and leases		6,582,620			6,507,607			5,339,334
Servicing assets, at fair value		19,844			19,743			19,172
Premises and equipment, net		66,627			67,121			56,798
Other real estate owned, net		1,200			1,671			4,717
Goodwill and other intangible assets, net		203,478			205,028			158,887
Bank-owned life insurance		96,900			96,268			82,093
Deferred tax assets, net		50,058			89,841			68,213
Accrued interest receivable and other assets		248,415			240,409			193,224
Total assets	$	8,881,967		$	8,943,368		$	7,362,941
LIABILITIES AND STOCKHOLDERS' EQUITY
LIABILITIES
Non-interest-bearing demand deposits	$	1,905,876		$	1,959,855		$	2,138,645
Interest-bearing deposits		5,271,123			4,993,835			3,556,476
Total deposits		7,176,999			6,953,690			5,695,121
Other borrowings		395,190			713,233			640,399
Subordinated notes, net		73,866			73,822			73,691
Junior subordinated debentures issued to capital trusts, net		70,452			70,336			37,338
Accrued expenses and other liabilities		175,309			212,342			150,576
Total liabilities		7,891,816			8,023,423			6,597,125
STOCKHOLDERS' EQUITY
Common stock		451			450			389
Additional paid-in capital		710,488			708,615			598,297
Retained earnings		429,036			403,368			335,794
Treasury stock		(49,707	)		(50,329	)		(51,114	)
Accumulated other comprehensive loss, net of tax		(100,117	)		(142,159	)		(117,550	)
Total stockholders' equity		990,151			919,945			765,816
Total liabilities and stockholders' equity	$	8,881,967		$	8,943,368		$	7,362,941

BYLINE BANCORP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)

	Three Months Ended									Year Ended
(dollars in thousands,	December 31,			September 30,			December 31,			December 31,			December 31,
except per share data)	2023			2023			2022			2023			2022
INTEREST AND DIVIDEND INCOME
Interest and fees on loans and leases	$	124,042		$	125,465		$	85,720		$	440,984		$	273,412
Interest on securities		9,227			8,415			6,569			30,801			25,390
Other interest and dividend income		2,345			2,710			1,515			7,693			2,757
Total interest and dividend income		135,614			136,590			93,804			479,478			301,559
INTEREST EXPENSE
Deposits		43,252			37,163			10,610			121,436			19,796
Other borrowings		3,051			3,981			4,598			17,161			9,322
Subordinated notes and debentures		3,026			2,994			1,992			10,260			7,111
Total interest expense		49,329			44,138			17,200			148,857			36,229
Net interest income		86,285			92,452			76,604			330,621			265,330
PROVISION FOR CREDIT LOSSES		7,235			8,803			5,826			31,653			23,879
Net interest income after provision for credit losses		79,050			83,649			70,778			298,968			241,451
NON-INTEREST INCOME
Fees and service charges on deposits		2,486			2,372			2,081			9,211			8,152
Loan servicing revenue		3,377			3,369			3,293			13,503			13,479
Loan servicing asset revaluation		(1,234	)		(3,646	)		(3,534	)		(5,089	)		(11,743	)
ATM and interchange fees		1,082			1,205			1,250			4,462			4,437
Net realized gains on securities available-for-sale		—			—			—			—			50
Change in fair value of equity securities, net		841			(313	)		710			1,071			(603	)
Net gains on sales of loans		5,480			6,473			5,509			22,805			31,899
Wealth management and trust income		1,256			939			864			4,158			3,807
Other non-interest income		1,215			1,977			1,282			6,194			7,836
Total non-interest income		14,503			12,376			11,455			56,315			57,314
NON-INTEREST EXPENSE
Salaries and employee benefits		31,974			34,969			31,808			126,979			118,051
Occupancy and equipment expense, net		4,346			5,314			3,532			18,508			16,988
Impairment charge on assets held for sale		1,980			—