(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (section 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☑ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined by Rule 12b-2 of the Exchange Act). Yes ☐ No ☑

As of ~~July 28,~~November 1, 2021, there were ~~65,403,675~~63,230,486 shares of Wesbanco, Inc. common stock, $2.0833 par value, outstanding.


Item No.	ITEM	Page No.	ITEM	Page No.

	PART I - FINANCIAL INFORMATION		PART I - FINANCIAL INFORMATION
1	Financial Statements	2	Financial Statements	2
	Consolidated Balance Sheets at June 30, 2021 (unaudited) and December 31, 2020	2	Consolidated Balance Sheets at September 30, 2021 (unaudited) and December 31, 2020	2
	Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2021 and 2020 (unaudited)	3	Consolidated Statements of Comprehensive Income for the three and nine months ended September 30, 2021 and 2020 (unaudited)	3
	Consolidated Statements of Changes in Shareholders' Equity for the three and six months ended June 30, 2021 and 2020 (unaudited)	4	Consolidated Statements of Changes in Shareholders' Equity for the three and nine months ended September 30, 2021 and 2020 (unaudited)	4
	Consolidated Statements of Cash Flows for the six months ended June 30, 2021 and 2020 (unaudited)	6	Consolidated Statements of Cash Flows for the nine months ended September 30, 2021 and 2020 (unaudited)	6
	Notes to Consolidated Financial Statements (unaudited)	7	Notes to Consolidated Financial Statements (unaudited)	7

2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	33	Management’s Discussion and Analysis of Financial Condition and Results of Operations	33

3	Quantitative and Qualitative Disclosures About Market Risk	53	Quantitative and Qualitative Disclosures About Market Risk	54

4	Controls and Procedures	55	Controls and Procedures	56

	PART II – OTHER INFORMATION		PART II – OTHER INFORMATION
1	Legal Proceedings	56	Legal Proceedings	57

2	Unregistered Sales of Equity Securities and Use of Proceeds	56	Unregistered Sales of Equity Securities and Use of Proceeds	57

6	Exhibits	57	Exhibits	58

	Signatures	58	Signatures	59

	June 30,			December 31,			September 30,			December 31,
(unaudited, in thousands, except shares)	2021			2020			2021			2020
ASSETS
Cash and due from banks, including interest bearing amounts of $637,312 and $721,086, respectively	$	846,304		$	905,447
Cash and due from banks, including interest bearing amounts of $919,611 and $721,086, respectively							$	1,121,116		$	905,447
Securities:
Equity securities, at fair value		13,494			13,047			13,451			13,047
Available-for-sale debt securities, at fair value		2,964,264			1,978,136			2,986,803			1,978,136
Held-to-maturity debt securities (fair values of $934,487 and $768,183, respectively)		902,172			731,212
Held-to-maturity debt securities (fair values of $978,494 and $768,183, respectively)								953,920			731,212
Allowance for credit losses, held-to-maturity debt securities		(227	)		(326	)		(257	)		(326	)
Net held-to-maturity debt securities		901,945			730,886			953,663			730,886
Total securities		3,879,703			2,722,069			3,953,917			2,722,069
Loans held for sale		41,461			168,378			32,308			168,378
Portfolio loans, net of unearned income		10,357,192			10,789,233			9,913,165			10,789,233
Allowance for credit losses - loans		(140,730	)		(185,827	)		(136,605	)		(185,827	)
Net portfolio loans		10,216,462			10,603,406			9,776,560			10,603,406
Premises and equipment, net		235,227			249,421			232,134			249,421
Accrued interest receivable		64,020			66,790			61,895			66,790
Goodwill and other intangible assets, net		1,157,322			1,163,091			1,154,468			1,163,091
Bank-owned life insurance		309,454			306,038			349,735			306,038
Other assets		216,914			240,970			209,978			240,970
Total Assets	$	16,966,867		$	16,425,610		$	16,892,111		$	16,425,610
LIABILITIES
Deposits:
Non-interest bearing demand	$	4,409,221		$	4,070,835		$	4,531,958		$	4,070,835
Interest bearing demand		3,214,484			2,839,536			3,283,444			2,839,536
Money market		1,771,686			1,685,927			1,765,480			1,685,927
Savings deposits		2,438,328			2,214,565			2,488,180			2,214,565
Certificates of deposit		1,484,536			1,618,510			1,354,252			1,618,510
Total deposits		13,318,255			12,429,373			13,423,314			12,429,373
Federal Home Loan Bank borrowings		313,960			549,003			208,940			549,003
Other short-term borrowings		135,267			241,950			152,546			241,950
Subordinated debt and junior subordinated debt		192,571			192,291			167,711			192,291
Total borrowings		641,798			983,244			529,197			983,244
Accrued interest payable		3,342			4,314			2,495			4,314
Other liabilities		222,636			251,942			213,122			251,942
Total Liabilities		14,186,031			13,668,873			14,168,128			13,668,873
SHAREHOLDERS' EQUITY
Preferred stock, no par value, 1,000,000 shares authorized; 150,000 shares 6.75% non-cumulative perpetual preferred stock, Series A, liquidation preference $150,000,000, issued and outstanding at June 30, 2021 and December 31, 2020, respectively		144,484			144,484
Common stock, $2.0833 par value; 100,000,000 shares authorized; 68,081,306 shares issued; 65,970,149 and 67,254,706 shares outstanding at June 30, 2021 and December 31, 2020, respectively		141,834			141,834
Preferred stock, no par value, 1,000,000 shares authorized; 150,000 shares 6.75% non-cumulative perpetual preferred stock, Series A, liquidation preference $150,000,000, issued and outstanding at September 30, 2021 and December 31, 2020, respectively								144,484			144,484
Common stock, $2.0833 par value; 100,000,000 shares authorized; 68,081,306 shares issued; 63,838,549 and 67,254,706 shares outstanding at September 30, 2021 and December 31, 2020, respectively								141,834			141,834
Capital surplus		1,632,460			1,634,815			1,634,086			1,634,815
Retained earnings		925,977			831,688			946,746			831,688
Treasury stock (2,111,157 and 826,600 shares - at cost, respectively)		(74,996	)		(25,949	)
Treasury stock (4,242,757 and 826,600 shares - at cost, respectively)								(146,102	)		(25,949	)
Accumulated other comprehensive income		12,586			31,359			4,463			31,359
Deferred benefits for directors		(1,509	)		(1,494	)		(1,528	)		(1,494	)
Total Shareholders' Equity		2,780,836			2,756,737			2,723,983			2,756,737
Total Liabilities and Shareholders' Equity	$	16,966,867		$	16,425,610		$	16,892,111		$	16,425,610

	For the Three Months Ended June 30,						For the Six Months Ended June 30,					For the Three Months Ended September 30,						For the Nine Months Ended September 30,
(unaudited, in thousands, except shares and per share amounts)	2021			2020			2021			2020		2021			2020			2021			2020
INTEREST AND DIVIDEND INCOME
Loans, including fees	$	105,968		$	115,068		$	215,327		$	234,571	$	103,206		$	116,524		$	318,532		$	351,095
Interest and dividends on securities:
Taxable		12,900			14,047			24,027			31,034		13,481			11,669			37,467			42,702
Tax-exempt		3,952			4,302			7,862			8,758		4,063			4,182			11,925			12,940
Total interest and dividends on securities		16,852			18,349			31,889			39,792		17,544			15,851			49,392			55,642
Other interest income		507			1,277			1,166			2,779		628			1,282			1,836			4,062
Total interest and dividend income		123,327			134,694			248,382			277,142		121,378			133,657			369,760			410,799
INTEREST EXPENSE
Interest bearing demand deposits		1,009			1,350			2,052			4,745		815			1,225			2,859			5,970
Money market deposits		551			879			1,130			3,231		350			707			1,488			3,937
Savings deposits		261			297			525			1,220		244			303			769			1,523
Certificates of deposit		2,026			3,514			4,396			7,568		1,726			3,197			6,122			10,765
Total interest expense on deposits		3,847			6,040			8,103			16,764		3,135			5,432			11,238			22,195
Federal Home Loan Bank borrowings		1,781			7,293			4,195			15,525		1,192			5,457			5,387			20,982
Other short-term borrowings		40			279			159			1,149		33			304			192			1,454
Subordinated debt and junior subordinated debt		1,804			2,069			3,593			4,530		1,743			1,871			5,336			6,400
Total interest expense		7,472			15,681			16,050			37,968		6,103			13,064			22,153			51,031
NET INTEREST INCOME		115,855			119,013			232,332			239,174		115,275			120,593			347,607			359,768
Provision for credit losses		(21,025	)		61,841			(48,984	)		91,661		(1,730	)		16,288			(50,714	)		107,949
Net interest income after provision for credit losses		136,880			57,172			281,316			147,513		117,005			104,305			398,321			251,819
NON-INTEREST INCOME
Trust fees		7,148			6,202			14,780			13,154		7,289			6,426			22,069			19,580
Service charges on deposits		4,876			4,323			9,770			10,940		6,050			5,332			15,820			16,272
Electronic banking fees		5,060			4,066			9,426			8,320		5,427			4,780			14,853			13,100
Net securities brokerage revenue		1,829			1,384			3,352			3,063		1,965			1,725			5,318			4,787
Bank-owned life insurance		1,707			1,752			3,416			3,521		2,656			2,088			6,072			5,609
Mortgage banking income		7,830			7,531			12,094			8,807		4,563			8,488			16,656			17,295
Net securities gains		477			1,299			756			2,790
Net securities (losses) gains													(15	)		787			740			3,577
Net gain (loss) on other real estate owned and other assets		4,014			(66	)		4,189			103		785			(19	)		4,974			84
Other income		3,171			6,369			11,537			10,171		4,035			5,005			15,574			15,177
Total non-interest income		36,112			32,860			69,320			60,869		32,755			34,612			102,076			95,481
NON-INTEREST EXPENSE
Salaries and wages		37,435			36,773			74,324			75,683		39,497			38,342			113,822			114,025
Employee benefits		9,268			10,138			19,534			20,511		10,658			10,604			30,191			31,115
Net occupancy		6,427			6,634			13,605			13,717		6,825			7,092			20,430			20,809
Equipment and software		7,281			5,722			14,045			11,761		7,609			6,229			21,654			17,991
Marketing		1,802			1,567			4,185			2,705		1,848			1,577			6,033			4,282
FDIC insurance		181			2,395			1,462			4,508		1,227			1,948			2,690			6,456
Amortization of intangible assets		2,873			3,365			5,769			6,739		2,854			3,346			8,622			10,085
Restructuring and merger-related expense		1,222			468			2,074			5,633		4,467			3,608			6,540			9,241
Other operating expenses		17,323			18,440			35,141			35,578		19,716			17,197			54,858			52,775
Total non-interest expense		83,812			85,502			170,139			176,835		94,701			89,943			264,840			266,779
Income before provision for income taxes		89,180			4,530			180,497			31,547		55,059			48,974			235,557			80,521
Provision for income taxes		18,592			42			36,793			3,663		10,651			7,669			47,445			11,332
Net income		70,588			4,488			143,704			27,884		44,408			41,305			188,112			69,189
Preferred stock dividends		2,531			—			5,063			—		2,531			—			7,594			—
Net income available to common shareholders	$	68,057		$	4,488		$	138,641		$	27,884	$	41,877		$	41,305		$	180,518		$	69,189
EARNINGS PER COMMON SHARE
Basic	$	1.02		$	0.07		$	2.07		$	0.41	$	0.64		$	0.61		$	2.72		$	1.03
Diluted	$	1.01		$	0.07		$	2.06		$	0.41	$	0.64		$	0.61		$	2.71		$	1.03
AVERAGE COMMON SHARES OUTSTANDING
Basic		66,894,398			67,104,628			67,078,036			67,295,589		64,931,764			67,214,759			66,354,750			67,268,449
Diluted		67,066,592			67,181,755			67,239,548			67,410,460		65,065,848			67,269,303			66,510,357			67,351,857
DIVIDENDS DECLARED PER COMMON SHARE	$	0.33		$	0.32		$	0.66		$	0.64	$	0.33		$	0.32		$	0.99		$	0.96

COMPREHENSIVE INCOME	$	73,371		$	3,863		$	124,931		$	67,199	$	36,285		$	39,090		$	161,216		$	106,289

	For the Three Months Ended June 30, 2021 and 2020																									For the Three Months Ended September 30, 2021 and 2020
																	Accumulated																									Accumulated
	Preferred		Common Stock														Other			Deferred						Preferred		Common Stock														Other			Deferred
(unaudited, in thousands, except	Stock		Shares					Capital			Retained			Treasury			Comprehensive			Benefits for						Stock		Shares					Capital			Retained			Treasury			Comprehensive			Benefits for
shares and per share amounts)	Amount		Outstanding			Amount		Surplus			Earnings			Stock			Income (Loss)			Directors			Total			Amount		Outstanding			Amount		Surplus			Earnings			Stock			Income (Loss)			Directors			Total
March 31, 2021	$	144,484		67,282,134		$	141,834	$	1,636,103		$	879,786		$	(24,989	)	$	9,803		$	(1,499	)	$	2,785,522
June 30, 2021																										$	144,484		65,970,149		$	141,834	$	1,632,460		$	925,977		$	(74,996	)	$	12,586		$	(1,509	)	$	2,780,836
Net income		—		—			—		—			70,588			—			—			—			70,588			—		—			—		—			44,408			—			—			—			44,408
Other comprehensive income		—		—			—		—			—			—			2,783			—			2,783
Other comprehensive loss																											—		—			—		—			—			—			(8,123	)		—			(8,123	)
Comprehensive income		—		—			—		—			—			—			—			—			73,371			—		—			—		—			—			—			—			—			36,285
Common dividends declared ($0.33 per share)		—		—			—		—			(21,866	)		—			—			—			(21,866	)		—		—			—		—			(21,108	)		—			—			—			(21,108	)
Preferred dividends declared ($16.875 per share)		—		—			—		—			(2,531	)		—			—			—			(2,531	)		—		—			—		—			(2,531	)		—			—			—			(2,531	)
Treasury shares acquired		—		(1,505,441	)		—		7			—			(56,668	)		—			—			(56,661	)		—		(2,138,515	)		—		—			—			(71,346	)		—			—			(71,346	)
Stock options exercised		—		70,800			—		(674	)		—			2,389			—			—			1,715			—		750			—		(10	)		—			26			—			—			16
Restricted stock granted		—		122,656			—		(4,272	)		—			4,272			—			—			—			—		6,165			—		(214	)		—			214			—			—			—
Stock compensation expense		—		—			—		1,292			—			—			—			—			1,292			—		—			—		1,836			—			—			—			—			1,836
Deferred benefits for directors- net		—		—			—		4			—			—			—			(10	)		(6	)		—		—			—		14			—			—			—			(19	)		(5	)
June 30, 2021	$	144,484		65,970,149		$	141,834	$	1,632,460		$	925,977		$	(74,996	)	$	12,586		$	(1,509	)	$	2,780,836
September 30, 2021																										$	144,484		63,838,549		$	141,834	$	1,634,086		$	946,746		$	(146,102	)	$	4,463		$	(1,528	)	$	2,723,983

March 31, 2020	$	—		67,058,155		$	141,827	$	1,638,122		$	800,064		$	(33,714	)	$	41,141		$	(1,380	)	$	2,586,060
June 30, 2020																										$	—		67,211,192		$	141,827	$	1,633,079		$	782,990		$	(27,518	)	$	40,516		$	(1,373	)	$	2,569,521
Net income		—	—			—		—				4,488		—			—			—				4,488			—	—			—		—				41,305		—			—			—				41,305
Other comprehensive loss		—	—			—		—			—			—				(625	)	—				(625	)		—	—			—		—			—			—				(2,215	)	—				(2,215	)
Comprehensive income		—	—			—		—			—			—			—			—				3,863			—	—			—		—			—			—			—			—				39,090
Common dividends declared ($0.32 per share)		—	—			—		—				(21,562	)	—			—			—				(21,562	)		—	—			—		—				(21,403	)	—			—			—				(21,403	)
Issuance of preferred stock, net of issuance costs																											144,529		—			—		—			—			—			—			—			144,529
Treasury shares acquired		—		(23,887	)	—			117		—				(372	)	—			—				(255	)		—		(3,209	)	—			—		—				(70	)	—			—				(70	)
Stock options exercised																											—		3,190			7		52			—			—			—			—			59
Restricted stock granted		—		176,924		—			(6,568	)	—				6,568		—			—			—				—		4,839		—			(185	)	—				185		—			—				—
Stock compensation expense		—	—			—			1,357		—			—			—			—				1,357			—	—			—			1,329		—			—			—			—				1,329
Deferred benefits for directors- net		—	—			—			51		—			—			—				7			58			—	—			—			(103	)	—			—			—				14			(89	)
June 30, 2020	$	—		67,211,192		$	141,827	$	1,633,079		$	782,990		$	(27,518	)	$	40,516		$	(1,373	)	$	2,569,521
September 30, 2020																										$	144,529		67,216,012		$	141,834	$	1,634,172		$	802,892		$	(27,403	)	$	38,301		$	(1,359	)	$	2,732,966

	For the Six Months Ended June 30, 2021 and 2020																									For the Nine Months Ended September 30, 2021 and 2020
																	Accumulated																									Accumulated
	Preferred		Common Stock														Other			Deferred						Preferred		Common Stock														Other			Deferred
(unaudited, in thousands, except	Stock		Shares					Capital			Retained			Treasury			Comprehensive			Benefits for						Stock		Shares					Capital			Retained			Treasury			Comprehensive			Benefits for
shares and per share amounts)	Amount		Outstanding			Amount		Surplus			Earnings			Stock			Income (Loss)			Directors			Total			Amount		Outstanding			Amount		Surplus			Earnings			Stock			Income (Loss)			Directors			Total
December 31, 2020	$	144,484		67,254,706		$	141,834	$	1,634,815		$	831,688		$	(25,949	)	$	31,359		$	(1,494	)	$	2,756,737		$	144,484		67,254,706		$	141,834	$	1,634,815		$	831,688		$	(25,949	)	$	31,359		$	(1,494	)	$	2,756,737
Net income		—		—			—		—			143,704			—			—			—			143,704			—		—			—		—			188,112			—			—			—			188,112
Other comprehensive loss		—		—			—		—			—			—			(18,773	)		—			(18,773	)		—		—			—		—			—			—			(26,896	)		—			(26,896	)
Comprehensive income		—		—			—		—			—			—			—			—			124,931			—		—			—		—			—			—			—			—			161,216
Common dividends declared ($0.66 per share)		—		—			—		—			(43,961	)		—			—			—			(43,961	)
Common dividends declared ($0.99 per share)																											—		—			—		—			(65,069	)		—			—			—			(65,069	)
Preferred dividends declared ($16.875 per share)		—		—			—		—			(5,063	)		—			—			—			(5,063	)		—		—			—		—			(7,594	)		—			—			—			(7,594	)
Stock issued for dividend reinvestment		—		11,720			—		—			(391	)		391			—			—			—			—		11,720			—		—			(391	)		391			—			—			—
Treasury shares acquired		—		(1,510,576	)		—		191			—			(56,851	)		—			—			(56,660	)		—		(3,649,091	)		—		191			—			(128,197	)		—			—			(128,006	)
Stock options exercised		—		91,643			—		(858	)		—			3,141			—			—			2,283			—		92,393			—		(867	)		—			3,167			—			—			2,300
Restricted stock granted		—		122,656			—		(4,272	)		—			4,272			—			—			—			—		128,821			—		(4,486	)		—			4,486			—			—			—
Stock compensation expense		—		—			—		2,580			—			—			—			—			2,580			—		—			—		4,415			—			—			—			—			4,415
Deferred benefits for directors- net		—		—			—		4			—			—			—			(15	)		(11	)		—		—			—		18			—			—			—			(34	)		(16	)
June 30, 2021	$	144,484		65,970,149		$	141,834	$	1,632,460		$	925,977		$	(74,996	)	$	12,586		$	(1,509	)	$	2,780,836
September 30, 2021																										$	144,484		63,838,549		$	141,834	$	1,634,086		$	946,746		$	(146,102	)	$	4,463		$	(1,528	)	$	2,723,983

December 31, 2019	$	—		67,824,428		$	141,827	$	1,636,966		$	824,694		$	(9,463	)	$	1,201		$	(1,304	)	$	2,593,921		$	—		67,824,428		$	141,827	$	1,636,966		$	824,694		$	(9,463	)	$	1,201		$	(1,304	)	$	2,593,921
Net income		—	—			—		—				27,884		—			—			—				27,884			—	—			—		—				69,189		—			—			—				69,189
Other comprehensive income		—	—			—		—			—			—				39,315		—				39,315			—	—			—		—			—			—				37,100		—				37,100
Comprehensive income		—	—			—		—			—			—			—			—				67,199			—	—			—		—			—			—			—			—				106,289
Common dividends declared ($0.64 per share)		—	—			—		—				(42,997	)	—			—			—				(42,997	)
Common dividends declared ($0.96 per share)																											—	—			—		—				(64,400	)	—			—			—				(64,400	)
Adoption of ASU 2016-13		—		—		—			—			(26,591	)		—		—			—				(26,591	)		—		—		—			—			(26,591	)		—		—			—				(26,591	)
Issuance of preferred stock, net of issuance costs																											144,529		—			—		—			—			—			—			—			144,529
Treasury shares acquired		—		(809,899	)	—			117		—				(25,344	)	—			—				(25,227	)		—		(813,108	)	—			118		—				(25,414	)	—			—				(25,296	)
Stock options exercised		—		19,739		—			(276	)	—				721		—			—				445			—		22,929			7		(224	)	—				721		—			—				504
Restricted stock granted		—		176,924			—		(6,568	)		—			6,568			—			—			—			—		181,763			—		(6,753	)		—			6,753			—			—			—
Stock compensation expense		—		—		—			2,727		—			—			—			—				2,727			—		—		—			4,055		—			—			—			—				4,055
Deferred benefits for directors- net		—	—			—			113		—			—			—				(69	)		44			—	—			—			10		—			—			—				(55	)		(45	)
June 30, 2020	$	—		67,211,192		$	141,827	$	1,633,079		$	782,990		$	(27,518	)	$	40,516		$	(1,373	)	$	2,569,521
September 30, 2020																										$	144,529		67,216,012			141,834		1,634,172			802,892			(27,403	)		38,301			(1,359	)	$	2,732,966

	For the Six Months Ended June 30,						For the Nine Months Ended September 30,
(unaudited, in thousands)	2021			2020			2021			2020
NET CASH PROVIDED BY OPERATING ACTIVITIES	$	229,342		$	89,394		$	276,138		$	20,628
INVESTING ACTIVITIES
Net decrease (increase) in loans held for investment		460,772			(853,709	)		919,999			(751,181	)
Available-for-sale debt securities:
Proceeds from sales		—			226,099			—			226,099
Proceeds from maturities, prepayments and calls		439,101			353,835			636,120			586,711
Purchases of securities		(1,457,566	)		(212,777	)		(1,691,731	)		(424,585	)
Held-to-maturity debt securities:
Proceeds from maturities, prepayments and calls		55,952			101,816			77,806			148,840
Purchases of securities		(228,307	)		(18,245	)		(302,710	)		(46,319	)
Equity securities:
Proceeds from sales		—			50			—			203
Purchases of bank owned life insurance								(40,000	)		—
Proceeds from bank owned life insurance		—			10			2,375			832
Purchases of premises and equipment – net		(4,603	)		(4,861	)		(5,856	)		(5,957	)
Sale of portfolio loans		—			37,195			—			37,195
Net cash used in investing activities		(734,651	)		(370,587	)		(403,997	)		(228,162	)
FINANCING ACTIVITIES
Increase in deposits		891,121			1,188,717			997,027			1,205,904
Proceeds from Federal Home Loan Bank borrowings		—			475,000			—			475,000
Repayment of Federal Home Loan Bank borrowings		(235,105	)		(761,098	)		(340,153	)		(1,096,157	)
(Decrease) increase in other short-term borrowings		(106,683	)		115,915			(89,404	)		107,047
Principal repayments of finance lease obligations		(219	)		(208	)		(331	)		(314	)
Decrease in federal funds purchased		—			(7,500	)		—			(7,500	)
Repayment of junior subordinated debt		—			(6,702	)
Repayment of subordinated and junior subordinated debt								(25,000	)		(6,702	)
Dividends paid to common shareholders		(43,509	)		(42,450	)		(65,311	)		(63,850	)
Dividends paid to preferred shareholders		(5,063	)	—				(7,594	)	—
Issuance of preferred stock, net of issuance costs								—			144,529
Issuance of common stock								—			59
Treasury shares purchased - net		(54,376	)		(24,943	)		(125,706	)		(25,012	)
Net cash provided by financing activities		446,166			936,731			343,528			733,004
Net (decrease) increase in cash, cash equivalents and restricted cash		(59,143	)		655,538
Net increase in cash, cash equivalents and restricted cash								215,669			525,470
Cash, cash equivalents and restricted cash at beginning of the period		905,447			234,796			905,447			234,796
Cash, cash equivalents and restricted cash at end of the period	$	846,304		$	890,334		$	1,121,116		$	760,266
SUPPLEMENTAL DISCLOSURES
Interest paid on deposits and other borrowings	$	18,917		$	45,965		$	26,547		$	62,149
Income taxes paid		22,055			1,125			34,595			30,375
Transfers of loans to other real estate owned		466			263			526			263
Transfers of portfolio loans to loans held for sale		—			37,195			—			37,195

Basis of presentation — The accompanying unaudited interim financial statements of Wesbanco, Inc. and its consolidated subsidiaries (“Wesbanco”) have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements and should be read in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2020.

Wesbanco’s interim financial statements have been prepared following the significant accounting policies disclosed in Note 1 of the Notes to the Consolidated Financial Statements of its 2020 Annual Report on Form 10-K filed with the Securities and Exchange Commission. In the opinion of management, the accompanying interim financial information reflects all adjustments, including normal recurring adjustments, necessary to present fairly Wesbanco’s financial position and results of operations for each of the interim periods presented. Certain prior period amounts have been reclassified to conform to the current period presentation. Such reclassifications had no impact on Wesbanco’s net income and stockholders’ equity. Results of operations for interim periods are not necessarily indicative of the results of operations that may be expected for a full year.

Recent accounting pronouncements—The Financial Accounting Standards Board (“FASB”) issued Accounting Standards Updates (“ASU”) as noted below.

In March 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848)”. This ASU provided temporary, optional guidance to ease the potential burden in accounting for, or recognizing the effects of, the transition away from LIBOR or other reference rate expected to be discontinued on financial reporting. The ASU also provides optional expedients for contract modifications that replace a reference rate affected by reference rate reform. The guidance is effective as of March 12, 2020 through December 31, 2022, and can be adopted at any time during this period. In January 2021, the FASB issued ASU 2021-01, “Reference Rate Reform (Topic 848): Scope”. This ASU refines the scope of Topic 848 and addresses questions about whether Topic 848 can be applied to derivative instruments that do not reference a rate that is expected to be discontinued, but that use an interest rate for margining, discounting or contract price alignment that is expected to be modified as a result of reference rate reform. ASU 2021-01 is effective upon issuance through December 31, 2022, and can be adopted at any time during this period. Wesbanco has not yet adopted either ASU, but has implemented a transition plan to identify and modify its loans and other financial instruments with attributes that are either directly or indirectly influenced by LIBOR, and continues to assess the impact of adopting the new guidance on the consolidated financial statements on an ongoing basis, with no material impacts expected at this time.

In December 2019, the FASB issued ASU 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes,” which removes specific exceptions to the general principles in Topic 740 in GAAP. It eliminates the need for an organization to analyze whether the following apply in a given period: (1) exception to the incremental approach for intraperiod tax allocation; (2) exceptions to accounting for basis differences when there are ownership changes in foreign investments; and (3) exception in interim period income tax accounting for year-to-date losses that exceed anticipated losses. The ASU also improves financial statement preparers’ application of income tax-related guidance and simplifies GAAP for: (1) franchise taxes that are partially based on income; (2) transactions with a government that result in a ~~step up~~step-up in the tax basis of goodwill; (3) separate financial statements of legal entities that are not subject to tax; and (4) enacted changes in tax laws in interim periods. For Wesbanco, this update was effective beginning January 1, 2021. The adoption of this pronouncement did not have a material impact on the financial statements.

	For the Three Months Ended June 30,				For the Six Months Ended June 30,				For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(unaudited, in thousands, except shares and per share amounts)	2021		2020		2021		2020		2021		2020		2021		2020
Numerator for both basic and diluted earnings per common share:
Net income available to common shareholders	$	68,057	$	4,488	$	138,641	$	27,884	$	41,877	$	41,305	$	180,518	$	69,189
Denominator:
Total average basic common shares outstanding		66,894,398		67,104,628		67,078,036		67,295,589		64,931,764		67,214,759		66,354,750		67,268,449
Effect of dilutive stock options and other stock compensation		172,194		77,127		161,512		114,871		134,084		54,544		155,607		83,408
Total diluted average common shares outstanding		67,066,592		67,181,755		67,239,548		67,410,460		65,065,848		67,269,303		66,510,357		67,351,857
Earnings per common share - basic	$	1.02	$	0.07	$	2.07	$	0.41	$	0.64	$	0.61	$	2.72	$	1.03
Earnings per common share - diluted	$	1.01	$	0.07	$	2.06	$	0.41	$	0.64	$	0.61	$	2.71	$	1.03

As of ~~June~~September 30, 2021 and 2020, respectively, ~~501,441~~534,961 and ~~567,685~~729,985 options to purchase shares were not included in the computation of net income per diluted share for the three months ended ~~June~~September 30, 2021 and 2020 because the exercise price was greater than the average market price of a common share, therefore, the effect would be antidilutive. As of ~~June~~September 30, 2021 and 2020, respectively, ~~540,661~~534,961 and ~~538,761~~536,761 options to purchase shares were not included in the computation of net income per diluted share for the ~~six~~nine months ended ~~June~~September 30, 2021 and 2020 ~~because~~on the ~~exercise price was greater than the average market price of a common share, therefore, the effect would be antidilutive.~~same basis.

As of ~~June~~September 30, 2021, ~~14,640~~0 shares related to the 2021, 2020 and 2019 total shareholder return ~~plan~~plans were included in the calculation ~~but 0 shares from the 2020 and 2019 plans were included~~ because the effect would be antidilutive. AsOn the same basis, as of ~~June~~September 30, 2020, 0 shares related to the 2020, 2019 and 2018 total shareholder return plans were included in the ~~calculation because the effect would be antidilutive.~~calculation.

In addition, performance-based restricted stock totaling 61,267 and ~~46,530~~27,371 shares were estimated to be awarded as of ~~June~~September 30, 2021 and ~~June~~September 30, 2020, respectively, and are included in the diluted ~~calculation.~~calculation for both the three and nine months ended.

The following table presents the fair value and amortized cost of available-for-sale and held-to-maturity debt securities:

	June 30, 2021									December 31, 2020									September 30, 2021									December 31, 2020
(unaudited, in thousands)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value		Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Estimated Fair Value
Available-for-sale debt securities
U.S. Treasury	$	19,995	$	3	$	—		$	19,998	$	39,975	$	7	$	—		$	39,982	$	10,000	$	—	$	—		$	10,000	$	39,975	$	7	$	—		$	39,982
U.S. Government sponsored entities and agencies		207,004		6,653		(1,167	)		212,490		204,109		7,715		(142	)		211,682		230,241		5,146		(1,952	)		233,435		204,109		7,715		(142	)		211,682
Residential mortgage-backed securities and collateralized mortgage obligations of government sponsored entities and agencies		2,264,266		28,106		(11,606	)		2,280,766		1,230,106		35,979		(1,348	)		1,264,737		2,285,014		24,071		(14,629	)		2,294,456		1,230,106		35,979		(1,348	)		1,264,737
Commercial mortgage-backed securities and collateralized mortgage obligations of government sponsored entities and agencies		309,525		7,586		(826	)		316,285		308,903		11,464		(269	)		320,098		316,004		6,223		(678	)		321,549		308,903		11,464		(269	)		320,098
Obligations of states and political subdivisions		103,763		6,342		(8	)		110,097		108,602		7,160		—			115,762		104,179		5,693		(51	)		109,821		108,602		7,160		—			115,762
Corporate debt securities		23,942		686		—			24,628		24,963		912		—			25,875		16,937		606		(1	)		17,542		24,963		912		—			25,875
Total available-for-sale debt securities	$	2,928,495	$	49,376	$	(13,607	)	$	2,964,264	$	1,916,658	$	63,237	$	(1,759	)	$	1,978,136	$	2,962,375	$	41,739	$	(17,311	)	$	2,986,803	$	1,916,658	$	63,237	$	(1,759	)	$	1,978,136
Held-to-maturity debt securities
U.S. Government sponsored entities and agencies	$	6,867	$	216	$	—		$	7,083	$	7,779	$	265	$	—		$	8,044	$	6,639	$	168	$	—		$	6,807	$	7,779	$	265	$	—		$	8,044
Residential mortgage-backed securities and collateralized mortgage obligations of government sponsored entities and agencies		70,745		2,365		(5	)		73,105		89,151		3,251		—			92,402		63,682		2,156		(3	)		65,835		89,151		3,251		—			92,402
Obligations of states and political subdivisions		791,441		28,212		(1,122	)		818,531		601,128		30,173		(59	)		631,242		850,498		24,087		(4,181	)		870,404		601,128		30,173		(59	)		631,242
Corporate debt securities		33,119		2,649		—			35,768		33,154		3,341		—			36,495		33,101		2,347		—			35,448		33,154		3,341		—			36,495
Total held-to-maturity debt securities ⁽¹⁾	$	902,172	$	33,442	$	(1,127	)	$	934,487	$	731,212	$	37,030	$	(59	)	$	768,183	$	953,920	$	28,758	$	(4,184	)	$	978,494	$	731,212	$	37,030	$	(59	)	$	768,183
Total debt securities	$	3,830,667	$	82,818	$	(14,734	)	$	3,898,751	$	2,647,870	$	100,267	$	(1,818	)	$	2,746,319	$	3,916,295	$	70,497	$	(21,495	)	$	3,965,297	$	2,647,870	$	100,267	$	(1,818	)	$	2,746,319

At ~~June~~September 30, 2021 and December 31, 2020, there were 0 holdings of any one issuer, other than U.S. government sponsored entities and its agencies, in an amount greater than 10% of Wesbanco’s shareholders’ equity. Equity securities, of which $10.5 million consist of investments in various mutual funds held in grantor trusts formed in connection with the Company’s deferred compensation plan, are recorded at fair value, and totaled $13.5 million and $13.0 million at ~~June~~September 30, 2021 and December 31, 2020, respectively.

The following table presents the amortized cost and fair value of available-for-sale and held-to-maturity debt securities by contractual maturity date at ~~June~~September 30, 2021. Actual maturities will differ from contractual maturities because borrowers may have the right to call or prepay debt obligations with or without prepayment penalties. Mortgage-backed securities and collateralized mortgage obligations are classified in the table below based on their contractual maturity date; however, regular principal payments and prepayments of principal are received on a monthly basis.

(unaudited, in thousands)	Amortized Cost		Fair Value		Amortized Cost		Fair Value
Available-for-sale debt securities
Less than one year	$	37,142	$	37,211	$	19,676	$	19,738
1-5 years		166,935		175,090		160,437		167,561
5-10 years		358,680		366,224		388,742		394,795
Over 10 years		2,365,738		2,385,739		2,393,520		2,404,709
Total available-for-sale debt securities	$	2,928,495	$	2,964,264	$	2,962,375	$	2,986,803
Held-to-maturity debt securities
Less than one year	$	11,599	$	11,711	$	16,539	$	16,735
1-5 years		133,817		140,934		128,436		134,632
5-10 years		225,448		235,791		232,619		242,600
Over 10 years		531,308		546,051		576,326		584,527
Total held-to-maturity debt securities	$	902,172	$	934,487	$	953,920	$	978,494
Total debt securities	$	3,830,667	$	3,898,751	$	3,916,295	$	3,965,297

Securities with an aggregate fair value of ~~$1.9~~$2.0 billion and $1.8 billion at ~~June~~September 30, 2021 and December 31, 2020, respectively, were pledged as security for public and trust funds, and securities sold under agreements to repurchase. Proceeds from the sale of available-for-sale securities were $0 and $226.1 million for the ~~six~~nine months ended ~~June~~September 30, 2021 and 2020, respectively. Net unrealized gains on available-for-sale securities included in accumulated other comprehensive income, net of tax, as of ~~June~~September 30, 2021 and December 31, 2020 were ~~$27.1~~$18.5 million and $46.9 million, respectively.

The following table presents the gross realized gains and losses on sales and calls of available-for-sale and held-to-maturity debt securities, as well as gains and losses on equity securities from both sales and market adjustments, for the three and ~~six~~nine months ended ~~June~~September 30, 2021 and 2020, respectively. All gains and losses presented in the table below are included in the net securities gains line item of the income statement. For those equity securities relating to the key officer and director deferred compensation plan, the corresponding change in the obligation to the participant is recognized in employee benefits expense.

	For the Three Months Ended June 30,					For the Six Months Ended June 30,						For the Three Months Ended September 30,						For the Nine Months Ended September 30,
(unaudited, in thousands)	2021		2020			2021			2020			2021			2020			2021			2020
Debt securities:
Gross realized gains	$	60	$	279		$	200		$	3,615		$	22		$	100		$	222		$	3,715
Gross realized losses		—		(34	)		(39	)		(1,066	)		(2	)		(2	)		(41	)		(1,068	)
Net gains on debt securities	$	60	$	245		$	161		$	2,549		$	20		$	98		$	181		$	2,647
Equity securities:
Net unrealized gains recognized on securities still held	$	417	$	1,054		$	595		$	249
Net realized losses recognized on securities sold		—		—			—			(8	)
Net gains on equity securities	$	417	$	1,054		$	595		$	241
Net securities gains	$	477	$	1,299		$	756		$	2,790
Net unrealized (losses) gains recognized on securities still held												$	(35	)	$	687		$	559		$	936
Net realized gains (losses) recognized on securities sold													—			2			—			(6	)
Net (losses) gains on equity securities												$	(35	)	$	689		$	559		$	930
Net securities (losses) gains												$	(15	)	$	787		$	740		$	3,577

The corporate and municipal bonds in Wesbanco’s held-to-maturity debt portfolio are analyzed quarterly to determine if an allowance for current expected credit losses is warranted. Wesbanco uses a database of historical financials of all corporate and municipal issuers and actual historic default and recovery rates on rated and non-rated transactions to estimate expected credit losses on an individual security basis. The expected credit losses are adjusted quarterly and are recorded in an allowance for expected credit losses on the balance sheet, which is deducted from the amortized cost basis of the held-to-maturity portfolio as a contra asset. The losses are recorded on the income statement in the provision for credit losses. Accrued interest receivable on held-to-maturity securities, which was ~~$6.4~~$7.1 million and $5.3 million as of ~~June~~September 30, 2021 and December 31, 2020, respectively, is excluded from the estimate of credit losses. Held-to-maturity investments in U.S. Government sponsored entities and agencies as well as mortgage-backed securities and collateralized mortgage obligations, which are all either issued by a direct governmental entity or a government-sponsored entity, have no historical evidence supporting expected credit losses; therefore, Wesbanco has estimated these losses at 0, and will monitor this assumption in the future for any economical or governmental policies that could affect this assumption.

The following table provides a roll-forward of the allowance for credit losses on held-to-maturity securities for the ~~six~~nine months ended ~~June~~September 30, 2021 and 2020:

	Allowance for Credit Losses By Category													Allowance for Credit Losses By Category
	For the Six Months Ended June 30, 2021 and 2020													For the Nine Months Ended September 30, 2021 and 2020
			Residential mortgage													Residential mortgage
			-backed													-backed
			securities and													securities and
			collateralized													collateralized
			mortgage obligations		Obligations of											mortgage obligations		Obligations of
	U.S. Government		of government		state and			Corporate						U.S. Government		of government		state and		Corporate
	sponsored		sponsored entities		political			debt						sponsored		sponsored entities		political		debt
(unaudited, in thousands)	entities and agencies		and agencies		subdivisions			Securities			Total			entities and agencies		and agencies		subdivisions		Securities			Total
Balance at December 31, 2020	$	—	$	—	$	130		$	196		$	326		$	—	$	—	$	130	$	196		$	326
Current period provision		—		—		(13	)		(86	)		(99	)		—		—		35		(104	)		(69	)
Write-offs		—		—		—			—			—			—		—		—		—			—
Recoveries		—		—		—			—			—			—		—		—		—			—
Balance at June 30, 2021	$	—	$	—	$	117		$	110		$	227
Balance at September 30, 2021														$	—	$	—	$	165	$	92		$	257
.
Balance at December 31, 2019	$	—	$	—	$	—		$	—		$	—		$	—	$	—	$	—	$	—		$	—
Impact of adopting ASC 326		—		—		96			133			229			—		—		96		133			229
Current period provision		—		—		521			67			588			—		—		172		60			232
Write-offs		—		—		—			—			—			—		—		—		—			—
Recoveries		—		—		—			—			—			—		—		—		—			—
Balance at June 30, 2020	$	—	$	—	$	617		$	200		$	817
Balance at September 30, 2020														$	—	$	—	$	268	$	193		$	461

The following tables provide information on unrealized losses on available-for-sale debt securities that have been in an unrealized loss position for less than twelve months and twelve months or more, for which an allowance for credit losses has not been recorded, as of ~~June~~September 30, 2021 and December 31, 2020, respectively:

	June 30, 2021																					September 30, 2021
	Less than 12 months							12 months or more							Total							Less than 12 months							12 months or more							Total
(unaudited, dollars in thousands)	Fair Value		Unrealized Losses			# of Securities		Fair Value		Unrealized Losses			# of Securities		Fair Value		Unrealized Losses			# of Securities		Fair Value		Unrealized Losses			# of Securities		Fair Value		Unrealized Losses			# of Securities		Fair Value		Unrealized Losses			# of Securities
U.S. Government sponsored entities and agencies	$	70,935	$	(1,167	)		6	$	—	$	—			—	$	70,935	$	(1,167	)		6	$	92,328	$	(1,421	)		7	$	17,919	$	(531	)		2	$	110,247	$	(1,952	)		9
Residential mortgage-backed securities and collateralized mortgage obligations of government sponsored entities and agencies		1,089,491		(11,514	)		109		4,991		(92	)		7		1,094,482		(11,606	)		116		1,202,988		(13,192	)		106		91,420		(1,437	)		17		1,294,408		(14,629	)		123
Commercial mortgage-backed securities and collateralized mortgage obligations of government sponsored entities and agencies		150,327		(826	)		20		—		—			—		150,327		(826	)		20		99,606		(337	)		20		39,204		(341	)		4		138,810		(678	)		24
Obligations of state and political subdivisions		4,341		(8	)		2		—		—			—		4,341		(8	)		2		7,458		(51	)		5		—		—			—		7,458		(51	)		5
Corporate debt and other securities																							4,499		(1	)		1		—		—			—		4,499		(1	)		1
Total	$	1,315,094	$	(13,515	)		137	$	4,991	$	(92	)		7	$	1,320,085	$	(13,607	)		144	$	1,406,879	$	(15,002	)		139	$	148,543	$	(2,309	)		23	$	1,555,422	$	(17,311	)		162

Unrealized losses on debt securities in the table above represents temporary fluctuations resulting from changes in market rates in relation to fixed yields. Unrealized losses in the available-for-sale portfolio are accounted for as an adjustment, net of taxes, to other comprehensive income in shareholders’ equity. Wesbanco does not believe the securities presented above are impaired due to reasons of credit quality, as substantially all debt securities are rated above investment grade and all are paying principal and interest according to their contractual terms. Wesbanco does not intend to

sell, nor is it more likely than not that it will be required to sell, loss position securities prior to recovery of their cost; therefore, management believes the unrealized losses detailed above do not require an allowance for credit losses relating to these securities to be recognized. Securities that do not have readily determinable fair values and for which Wesbanco does not exercise significant influence are carried at cost. Cost method investments consist primarily of Federal Home Loan Bank (“FHLB”) of Pittsburgh ~~and Indianapolis~~ stock totaling ~~$24.0~~$17.0 million and $34.0 million at ~~June~~September 30, 2021 and December 31, 2020, respectively, and are included in other assets in the Consolidated Balance Sheets. Cost method investments are evaluated for impairment whenever events or circumstances suggest that their carrying value may not be recoverable.

The recorded investment in loans is presented in the Consolidated Balance Sheets net of deferred loan fees and costs, and discounts on purchased loans. Net deferred loan fee income was ~~$9.6~~$1.7 million and $6.2 million at ~~June~~September 30, 2021 and December 31, 2020, respectively. At ~~June~~September 30, 2021 and December 31, 2020, respectively, the balance also included ~~$17.6~~$10.4 million and $13.8 million of net deferred fee income from SBA Payroll Protection Program (“PPP”) loans. The un-accreted discount on purchased loans from acquisitions was ~~$32.2~~$28.9 million at ~~June~~September 30, 2021 and $39.4 million at December 31, 2020.

	June 30,		December 31,		September 30,		December 31,
(unaudited, in thousands)	2021		2020		2021		2020
Commercial real estate:
Land and construction	$	588,218	$	668,277	$	824,199	$	668,277
Improved property		5,117,028		5,037,115		4,833,687		5,037,115
Total commercial real estate		5,705,246		5,705,392		5,657,886		5,705,392
Commercial and industrial		1,575,612		1,681,182		1,435,154		1,681,182
Commercial and industrial - PPP		543,574		726,256		272,060		726,256
Residential real estate		1,625,632		1,720,961		1,655,229		1,720,961
Home equity		631,059		646,387		607,735		646,387
Consumer		276,069		309,055		285,101		309,055
Total portfolio loans		10,357,192		10,789,233		9,913,165		10,789,233
Loans held for sale		41,461		168,378		32,308		168,378
Total loans	$	10,398,653	$	10,957,611	$	9,945,473	$	10,957,611

The allowance for credit losses under the current expected credit losses methodology (“CECL”) is calculated utilizing the probability of default (“PD”) / loss given default (“LGD”), which is then discounted to net present value. PD is the probability the asset will default within a given time frame and LGD is the percentage of the asset not expected to be collected due to default. The primary macroeconomic drivers of the quantitative model include forecasts of national unemployment and interest rates, as well as modeling adjustments for changes in prepayment speeds, loan risk grades, portfolio mix, concentrations and loan growth. For the calculation as of ~~June~~September 30, 2021, the one-year forecast was based upon a blended rate from two nationally-recognized published economic forecasts through ~~June~~September 30, 2021, and is primarily driven by the national unemployment and interest rate spread forecasts. Wesbanco’s blended forecast of national unemployment, at quarter end, was projected to peak at ~~5.2%~~4.7% in the ~~third~~fourth quarter, and subsequently decrease to an average of ~~4.2%~~4.0% over the remainder of the forecast period. The calculation utilized a one-year reversion period back to the Company’s historical loss rate by loan classification. Included in the qualitative factors were COVID-19 pandemic factors related to the transient credit risk not ~~covered by~~included within the ~~traditional allowance process,~~quantitative model calculation, adjusted to Wesbanco’s regional footprint, deferred interest on modified loans, and hospitality industry concentration. As of ~~June~~September 30, 2021, accrued interest receivable for loans was ~~$50.5~~$48.1 million. Wesbanco made an accounting policy election to exclude accrued interest from the measurement of the allowance for credit losses because the Company has a robust policy in place to reverse or write-off accrued interest when loans are placed on non-accrual. However, Wesbanco does have a ~~$0.2~~$0.1 million reserve on the accrued interest related to loan modifications allowed under the CARES Act due to the timing and nature of these modifications. As of ~~June~~September 30, 2021, accrued interest receivable related to COVID-19 loan modifications as permitted under the CARES Act was ~~$24.1~~$23.1 million.

The following tables summarize changes in the allowance for credit losses applicable to each category of the loan portfolio:

	Allowance for Credit Losses By Category																								Allowance for Credit Losses By Category
	For the Six Months Ended June 30, 2021 and 2020																								For the Nine Months Ended September 30, 2021 and 2020
(unaudited, in thousands)	Commercial Real Estate - Land and Construction			Commercial Real Estate- Improved Property			Commercial & Industrial			Residential Real Estate			Home Equity			Consumer			Deposit Overdrafts			Total			Commercial Real Estate - Land and Construction			Commercial Real Estate- Improved Property			Commercial & Industrial			Residential Real Estate			Home Equity			Consumer			Deposit Overdrafts			Total
Balance at December 31, 2020
Allowance for credit losses - loans	$	10,841		$	110,652		$	37,850		$	17,851		$	1,487		$	6,507		$	639		$	185,827		$	10,841		$	110,652		$	37,850		$	17,851		$	1,487		$	6,507		$	639		$	185,827
Allowance for credit losses - loan commitments		6,508			712			1,275			955			45			19			—			9,514			6,508			712			1,275			955			45			19			—			9,514
Total beginning allowance for credit losses - loans and loan commitments		17,349			111,364			39,125			18,806			1,532			6,526			639			195,341			17,349			111,364			39,125			18,806			1,532			6,526			639			195,341
Provision for credit losses:
Provision for loan losses		(4,740	)		(25,672	)		(8,090	)		(4,535	)		(719	)		(1,964	)		582			(45,138	)		(3,665	)		(29,171	)		(10,669	)		(3,481	)		(877	)		(2,268	)		1,709			(48,422	)
Provision for loan commitments		(2,929	)		(618	)		(334	)		111			5			17			—			(3,748	)		(2,829	)		(394	)		451			254			7			287			—			(2,224	)
Total provision for credit losses - loans and loan commitments		(7,669	)		(26,290	)		(8,424	)		(4,424	)		(714	)		(1,947	)		582			(48,886	)		(6,494	)		(29,565	)		(10,218	)		(3,227	)		(870	)		(1,981	)		1,709			(50,646	)
Charge-offs		(22	)		(235	)		(814	)		(441	)		(274	)		(1,406	)		(365	)		(3,557	)		(22	)		(933	)		(1,717	)		(842	)		(382	)		(2,210	)		(932	)		(7,038	)
Recoveries		110			646			518			742			340			1,042			200			3,598			110			1,053			1,737			885			471			1,718			264			6,238
Net (charge-offs) recoveries		88			411			(296	)		301			66			(364	)		(165	)		41			88			120			20			43			89			(492	)		(668	)		(800	)
Balance at June 30, 2021
Balance at September 30, 2021
Allowance for credit losses - loans		6,189			85,391			29,464			13,617			834			4,179			1,056			140,730			7,264			81,601			27,201			14,413			699			3,747			1,680			136,605
Allowance for credit losses - loan commitments		3,579			94			941			1,066			50			36			—			5,766			3,679			318			1,726			1,209			52			306			—			7,290
Total ending allowance for credit losses - loans and loan commitments	$	9,768		$	85,485		$	30,405		$	14,683		$	884		$	4,215		$	1,056		$	146,496		$	10,943		$	81,919		$	28,927		$	15,622		$	751		$	4,053		$	1,680		$	143,895

Balance at December 31, 2019
Allowance for credit losses - loans	$	4,949		$	20,293		$	14,116		$	4,311		$	4,422		$	2,951		$	1,387		$	52,429		$	4,949		$	20,293		$	14,116		$	4,311		$	4,422		$	2,951		$	1,387		$	52,429
Allowance for credit losses - loan commitments		235			22			311			15			250			41			—			874			235			22			311			15			250			41			—			874
Total beginning allowance for credit losses - loans and loan commitments		5,184			20,315			14,427			4,326			4,672			2,992			1,387			53,303			5,184			20,315			14,427			4,326			4,672			2,992			1,387			53,303
Impact of adopting ASC 326		1,524			13,078			22,357			5,630			(3,936	)		2,576			213			41,442			1,524			13,078			22,357			5,630			(3,936	)		2,576			213			41,442
Provision for credit losses:
Provision for loan losses		6,388			58,706			10,390			4,554			1,486			3,102			(409	)		84,217			9,150			73,774			9,923			2,779			1,793			3,160			139			100,718
Provision for loan commitments		5,223			—			1,280			318			35			—			—			6,856			5,888			—			858			199			52			3			—			7,000
Total provision for credit losses - loans and loan commitments		11,611			58,706			11,670			4,872			1,521			3,102			(409	)		91,073			15,038			73,774			10,781			2,978			1,845			3,163			139			107,718
Charge-offs		(1	)		(1,895	)		(3,187	)		(667	)		(562	)		(2,183	)		(516	)		(9,011	)		(51	)		(1,903	)		(3,329	)		(809	)		(857	)		(2,860	)		(760	)		(10,569	)
Recoveries		77			396			227			376			255			768			254			2,353			85			702			852			487			419			1,136			363			4,044
Net (charge-offs) recoveries		76			(1,499	)		(2,960	)		(291	)		(307	)		(1,415	)		(262	)		(6,658	)		34			(1,201	)		(2,477	)		(322	)		(438	)		(1,724	)		(397	)		(6,525	)
Balance at June 30, 2020
Balance at September 30, 2020
Allowance for credit losses - loans		10,335			90,600			43,632			13,824			1,900			7,255			929			168,475			13,055			105,966			43,648			12,018			2,076			7,004			1,342			185,109
Allowance for credit losses - loan commitments		8,060			—			1,862			713			50			—			—			10,685			8,725			—			1,440			594			67			3			—			10,829
Total ending allowance for credit losses - loans and loan commitments	$	18,395		$	90,600		$	45,494		$	14,537		$	1,950		$	7,255		$	929		$	179,160		$	21,780		$	105,966		$	45,088		$	12,612		$	2,143		$	7,007		$	1,342		$	195,938

The following tables present the allowance for credit losses and recorded investments in loans by category, as of each period-end:

	Allowance for Credit Losses and Recorded Investment in Loans																Allowance for Credit Losses and Recorded Investment in Loans
(unaudited, in thousands)	Commercial Real Estate- Land and Construction		Commercial Real Estate- Improved Property		Commercial and Industrial		Residential Real Estate		Home Equity		Consumer		Deposit Over- drafts		Total		Commercial Real Estate- Land and Construction		Commercial Real Estate- Improved Property		Commercial and Industrial		Residential Real Estate		Home Equity		Consumer		Deposit Over- drafts		Total
June 30, 2021
September 30, 2021
Allowance for credit losses:
Loans individually-evaluated	$	466	$	3,973	$	1,505	$	—	$	—	$	—	$	—	$	5,944	$	417	$	16,456	$	409	$	—	$	—	$	—	$	—	$	17,282
Loans collectively-evaluated		5,723		81,418		27,959		13,617		834		4,179		1,056		134,786		6,847		65,145		26,792		14,413		699		3,747		1,680		119,323
Loan commitments		3,579		94		941		1,066		50		36		—		5,766		3,679		318		1,726		1,209		52		306		—		7,290
Total allowance for credit losses - loans and commitments	$	9,768	$	85,485	$	30,405	$	14,683	$	884	$	4,215	$	1,056	$	146,496	$	10,943	$	81,919	$	28,927	$	15,622	$	751	$	4,053	$	1,680	$	143,895

Portfolio loans:
Individually-evaluated for credit losses⁽¹⁾	$	1,334	$	39,907	$	1,820	$	—	$	—	$	—	$	—	$	43,061
Individually-evaluated for credit losses																	$	1,291	$	76,276	$	641	$	—	$	—	$	—	$	—	$	78,208
Collectively-evaluated for credit losses		586,884		5,077,121		2,117,366		1,625,632		631,059		276,069		—		10,314,131		822,908		4,757,411		1,706,573		1,655,229		607,735		285,101		—		9,834,957
Total portfolio loans	$	588,218	$	5,117,028	$	2,119,186	$	1,625,632	$	631,059	$	276,069	$	—	$	10,357,192	$	824,199	$	4,833,687	$	1,707,214	$	1,655,229	$	607,735	$	285,101	$	—	$	9,913,165

December 31, 2020
Allowance for credit losses:
Loans individually-evaluated	$	602	$	4,196	$	1,484	$	—	$	—	$	—	$	—	$	6,282	$	602	$	4,196	$	1,484	$	—	$	—	$	—	$	—	$	6,282
Loans collectively-evaluated		10,239		106,456		36,366		17,851		1,487		6,507		639		179,545		10,239		106,456		36,366		17,851		1,487		6,507		639		179,545
Loan commitments		6,508		712		1,275		955		45		19		—		9,514		6,508		712		1,275		955		45		19		—		9,514
Total allowance for credit losses - loans and commitments	$	17,349	$	111,364	$	39,125	$	18,806	$	1,532	$	6,526	$	639	$	195,341	$	17,349	$	111,364	$	39,125	$	18,806	$	1,532	$	6,526	$	639	$	195,341

Portfolio loans:
Individually-evaluated for credit losses⁽¹⁾	$	1,455	$	40,372	$	2,863	$	—	$	—	$	—	$	—	$	44,690
Individually-evaluated for credit losses																	$	1,455	$	40,372	$	2,863	$	—	$	—	$	—	$	—	$	44,690
Collectively-evaluated for credit losses		666,822		4,996,743		2,404,575		1,720,961		646,387		309,055		—		10,744,543		666,822		4,996,743		2,404,575		1,720,961		646,387		309,055		—		10,744,543
Total portfolio loans	$	668,277	$	5,037,115	$	2,407,438	$	1,720,961	$	646,387	$	309,055	$	—	$	10,789,233	$	668,277	$	5,037,115	$	2,407,438	$	1,720,961	$	646,387	$	309,055	$	—	$	10,789,233

Commercial loan risk grades are determined based on an evaluation of the relevant characteristics of each loan, assigned at inception and adjusted thereafter at any time to reflect changes in the risk profile throughout the life of each loan. The primary factors used to determine the risk grade are the sufficiency, reliability and sustainability of the primary source of repayment and overall financial strength of the borrower. The rating system more heavily weights the debt service coverage, leverage and loan to value factors to derive the risk grade. Other factors that are considered at a lesser weighting include management, industry or property type risks, payment history, collateral or guarantees.

Commercial real estate – land and construction consists of loans to finance investments in vacant land, land development, construction of residential housing, and construction of commercial buildings. Commercial real estate – improved property consists of loans for the purchase or refinance of all types of improved owner-occupied and investment properties. Factors that are considered in assigning the risk grade vary depending on the type of property financed. The risk grade assigned to construction and development loans is based on the overall viability of the project, the experience and financial capacity of the developer or builder to successfully complete the project, project specific and market absorption rates and comparable property values, and the amount of pre-sales for residential housing construction or pre-leases for commercial investment property. The risk grade assigned to commercial investment property loans is based primarily on the adequacy of the net operating income generated by the property to service the debt (“debt service coverage”), the loan to appraised value, the type, quality, industry and mix of tenants, and the terms of leases. The risk grade assigned to owner-occupied commercial real estate is based primarily on global debt service coverage and the leverage of the business, but may also consider the industry in which the business operates, the business’ specific competitive advantages or disadvantages, collateral margins and the quality and experience of management.

Commercial and industrial (“C&I”) loans consist of revolving lines of credit to finance accounts receivable, inventory and other general business purposes; term loans to finance fixed assets other than real estate, and letters of credit to support trade, insurance or governmental requirements for a variety of businesses. Most C&I borrowers are privately-held companies with annual sales up to $100 million. Primary factors that are considered in risk rating C&I loans include debt service coverage and leverage. Other factors including operating trends, collateral coverage along with management experience are also considered.

Pass loans are those that exhibit a history of positive financial results that are at least comparable to the average for their industry or type of real estate. The primary source of repayment is acceptable and these loans are expected to perform satisfactorily during most economic cycles. Pass loans typically have no significant external factors that are expected to adversely affect these borrowers more than others in the same industry or property type. Any minor unfavorable characteristics of these loans are outweighed or mitigated by other positive factors including but not limited to adequate secondary or tertiary sources of repayment.

Criticized loans, considered as compromised, have potential weaknesses that deserve management's close attention. If left uncorrected, these potential weaknesses may result in deterioration of the repayment prospects for the asset or in the bank's credit position at some future date. Criticized loans are not adversely classified by the banking regulators and do not expose the bank to sufficient risk to warrant adverse classification.

Classified loans, considered as substandard and doubtful, are equivalent to the classifications used by banking regulators. Substandard loans are inadequately protected by the current sound worth and paying capacity of the obligor or of the collateral pledged, if any. Loans so classified must have a well-defined weakness or weaknesses that jeopardize the liquidation of the debt. They are characterized by the distinct possibility that the bank will sustain some loss if the deficiencies are not corrected. These loans may or may not be reported as non-accrual. Doubtful loans have all the weaknesses inherent in those classified substandard, with the added characteristic that the weaknesses make collection or liquidation in full, on the basis of currently known facts, conditions, and values, highly questionable and improbable. These loans are reported as non-accrual.

	Commercial Loans by Internally Assigned Risk Grade								Commercial Loans by Internally Assigned Risk Grade
(unaudited, in thousands)	Commercial Real Estate- Land and Construction		Commercial Real Estate- Improved Property		Commercial & Industrial		Total Commercial Loans		Commercial Real Estate- Land and Construction		Commercial Real Estate- Improved Property		Commercial & Industrial		Total Commercial Loans
As of June 30, 2021
As of September 30, 2021
Pass	$	581,597	$	4,733,494	$	2,052,966	$	7,368,057	$	795,033	$	4,502,015	$	1,650,749	$	6,947,797
Criticized - compromised		4,990		284,243		30,215		319,448		26,436		240,958		22,887		290,281
Classified - substandard		1,631		99,291		36,005		136,927		2,730		90,714		33,578		127,022
Classified - doubtful		—		—		—		—		—		—		—		—
Total	$	588,218	$	5,117,028	$	2,119,186	$	7,824,432	$	824,199	$	4,833,687	$	1,707,214	$	7,365,100

As of December 31, 2020
Pass	$	657,435	$	4,609,726	$	2,350,724	$	7,617,885	$	657,435	$	4,609,726	$	2,350,724	$	7,617,885
Criticized - compromised		7,397		320,301		34,597		362,295		7,397		320,301		34,597		362,295
Classified - substandard		3,445		107,088		22,117		132,650		3,445		107,088		22,117		132,650
Classified - doubtful		—		—		—		—		—		—		—		—
Total	$	668,277	$	5,037,115	$	2,407,438	$	8,112,830	$	668,277	$	5,037,115	$	2,407,438	$	8,112,830

Residential real estate, home equity and consumer loans are not assigned internal risk grades other than as required by regulatory guidelines that are based primarily on the age of past due loans. Wesbanco primarily evaluates the credit quality of residential real estate, home equity and consumer loans based on repayment performance and historical loss rates. The aggregate amount of residential real estate, home equity and consumer loans classified as substandard in accordance with regulatory guidelines was ~~$31.1~~$29.4 million at ~~June~~September 30, 2021 and $27.7 million at December 31, 2020, of which ~~$7.9~~$6.2 million and $4.1 million were accruing, for each period, respectively. ~~The aggregate amount of residential real estate, home equity and consumer~~These loans ~~classified as substandard, as well as $26.0~~are not included in the tables above. In addition, $20.4 million and $28.7 million of unfunded commercial loan commitments, are also not included in the tables above at ~~June~~September 30, 2021 and December 31, 2020, respectively.

	Age Analysis of Loans															Age Analysis of Loans
(unaudited, in thousands)	Current		30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due		Total Past Due			Total Loans		90 Days or More Past Due and Accruing (1)		Current		30-59 Days Past Due		60-89 Days Past Due		90 Days or More Past Due		Total Past Due		Total Loans		90 Days or More Past Due and Accruing (1)
As of June 30, 2021
As of September 30, 2021
Commercial real estate:
Land and construction	$	586,912	$	1,149	$	—	$	157	$	1,306		$	588,218	$	83	$	821,068	$	671	$	1,060	$	1,400	$	3,131	$	824,199	$	1,256
Improved property		5,095,475		5,517		5,855		10,181		21,553			5,117,028		2,453		4,813,893		8,721		2,146		8,927		19,794		4,833,687		2,308
Total commercial real estate		5,682,387		6,666		5,855		10,338		22,859			5,705,246		2,536		5,634,961		9,392		3,206		10,327		22,925		5,657,886		3,564
Commercial and industrial		2,108,882		1,964		1,096		7,244		10,304			2,119,186		3,224		1,689,657		5,200		4,355		8,002		17,557		1,707,214		4,781
Residential real estate		1,610,608		1,153		2,260		11,611		15,024			1,625,632		1,886		1,636,941		2,218		3,496		12,574		18,288		1,655,229		1,746
Home equity		625,173		2,135		417		3,334		5,886			631,059		409		600,760		3,006		240		3,729		6,975		607,735		851
Consumer		273,437		1,649		648		335		2,632			276,069		263		281,435		2,528		640		498		3,666		285,101		310
Total portfolio loans		10,300,487		13,567		10,276		32,862		56,705			10,357,192		8,318		9,843,754		22,344		11,937		35,130		69,411		9,913,165		11,252
Loans held for sale		41,461		—		—		—		—			41,461		—		32,308		—		—		—		—		32,308		—
Total loans	$	10,341,948	$	13,567	$	10,276	$	32,862	$	56,705		$	10,398,653	$	8,318	$	9,876,062	$	22,344	$	11,937	$	35,130	$	69,411	$	9,945,473	$	11,252

Nonperforming loans included above are as follows:
Non-accrual loans	$	9,140	$	825	$	1,710	$	24,537	$	27,072		$	36,212			$	11,245	$	408	$	1,067	$	23,539	$	25,014	$	36,259
TDRs accruing interest ⁽¹⁾		5,717		4		71		7		82			5,799
TDRs accruing interest																	3,244		3		121		339		463		3,707
Total nonperforming loans	$	14,857	$	829	$	1,781	$	24,544	$	27,154		$	42,011			$	14,489	$	411	$	1,188	$	23,878	$	25,477	$	39,966

As of December 31, 2020
Commercial real estate:
Land and construction	$	664,990	$	582	$	2,276	$	429	$	3,287		$	668,277	$	288	$	664,990	$	582	$	2,276	$	429	$	3,287	$	668,277	$	288
Improved property		5,016,812		4,876		4,118		11,309		20,303			5,037,115		2,713		5,016,812		4,876		4,118		11,309		20,303		5,037,115		2,713
Total commercial real estate		5,681,802		5,458		6,394		11,738		23,590			5,705,392		3,001		5,681,802		5,458		6,394		11,738		23,590		5,705,392		3,001
Commercial and industrial		2,395,844		4,372		2,197		5,025		11,594			2,407,438		1,899		2,395,844		4,372		2,197		5,025		11,594		2,407,438		1,899
Residential real estate		1,698,636		2,614		5,654		14,057		22,325			1,720,961		2,863		1,698,636		2,614		5,654		14,057		22,325		1,720,961		2,863
Home equity		639,319		2,414		775		3,879		7,068			646,387		706		639,319		2,414		775		3,879		7,068		646,387		706
Consumer		305,483		1,998		1,031		543		3,572			309,055		377		305,483		1,998		1,031		543		3,572		309,055		377
Total portfolio loans		10,721,084		16,856		16,051		35,242		68,149			10,789,233		8,846		10,721,084		16,856		16,051		35,242		68,149		10,789,233		8,846
Loans held for sale		168,378		—		—		—		—			168,378		—		168,378		—		—		—		—		168,378		—
Total loans	$	10,889,462	$	16,856	$	16,051	$	35,242	$	68,149		$	10,957,611	$	8,846	$	10,889,462	$	16,856	$	16,051	$	35,242	$	68,149	$	10,957,611	$	8,846

Nonperforming loans included above are as follows:
Non-accrual loans	$	9,560	$	630	$	466	$	26,224	$	27,320	��	$	36,880			$	9,560	$	630	$	466	$	26,224	$	27,320	$	36,880
TDRs accruing interest ⁽¹⁾		3,540		63		152		172		387			3,927
TDRs accruing interest																	3,540		63		152		172		387		3,927
Total nonperforming loans	$	13,100	$	693	$	618	$	26,396	$	27,707		$	40,807			$	13,100	$	693	$	618	$	26,396	$	27,707	$	40,807

	Nonperforming Loans												Nonperforming Loans
	June 30, 2021						December 31, 2020						September 30, 2021						December 31, 2020
	Unpaid						Unpaid						Unpaid						Unpaid
	Principal		Recorded		Related		Principal		Recorded		Related		Principal		Recorded		Related		Principal		Recorded		Related
(unaudited, in thousands)	Balance (1)		Investment		Allowance		Balance (1)		Investment		Allowance		Balance (1)		Investment		Allowance		Balance (1)		Investment		Allowance
With no related specific allowance recorded:
Commercial real estate:
Land and construction	$	74	$	74	$	—	$	469	$	469	$	—	$	1,175	$	145	$	—	$	469	$	469	$	—
Improved property		8,218		6,672		—		9,597		8,055	—			7,555		5,870		—		9,597		8,055	—
Commercial and industrial		4,897		4,669		—		4,401		3,413	—			6,228		5,373		—		4,401		3,413	—
Residential real estate		24,888		22,443		—		23,055		20,704	—			25,964		20,655		—		23,055		20,704	—
Home equity		6,664		5,766		—		6,635		5,708	—			6,914		5,321		—		6,635		5,708	—
Consumer		554		303		—		602		364	—			843		518		—		602		364	—
Total nonperforming loans without a specific allowance		45,295		39,927		—		44,759		38,713		—		48,679		37,882		—		44,759		38,713		—
With a specific allowance recorded:
Commercial real estate:
Land and construction		—		—		—	—		—		—			—		—		—	—		—		—
Improved property		2,094		2,084		214		2,094		2,094		136		2,285		2,084		257		2,094		2,094		136
Commercial and industrial		—		—		—	—		—		—			—		—		—	—		—		—
Residential real estate		—		—		—	—		—		—			—		—		—	—		—		—
Home equity		—		—		—	—		—		—			—		—		—	—		—		—
Consumer		—		—		—	—		—		—			—		—		—	—		—		—
Total nonperforming loans with a specific allowance		2,094		2,084		214		2,094		2,094		136		2,285		2,084		257		2,094		2,094		136
Total nonperforming loans	$	47,389	$	42,011	$	214	$	46,853	$	40,807	$	136	$	50,964	$	39,966	$	257	$	46,853	$	40,807	$	136

	Nonperforming Loans																Nonperforming Loans
	For the Three Months Ended								For the Six Months Ended								For the Three Months Ended										For the Nine Months Ended
	June 30, 2021				June 30, 2020				June 30, 2021				June 30, 2020				September 30, 2021					September 30, 2020					September 30, 2021				September 30, 2020
	Average		Interest		Average		Interest		Average		Interest		Average		Interest		Average		Interest			Average		Interest			Average		Interest		Average		Interest
	Recorded		Income		Recorded		Income		Recorded		Income		Recorded		Income		Recorded		Income			Recorded		Income			Recorded		Income		Recorded		Income
(unaudited, in thousands)	Investment		Recognized		Investment		Recognized		Investment		Recognized		Investment		Recognized		Investment		Recognized			Investment		Recognized			Investment		Recognized		Investment		Recognized
With no related specific allowance recorded:
Commercial real estate:
Land and construction	$	97	$	—	$	405	$	—	$	221	$	—	$	463	$	—	$	110	$	—		$	801	$	—		$	202	$	—	$	597	$	—
Improved property		7,011		8		7,349		15		7,359		17		6,309		35		6,271		6			8,454		16			6,987		23		6,977		51
Commercial and industrial		3,172		2		2,862		3		3,252		3		6,679		6		5,021		(2	)		2,864		(1	)		3,783		1		5,717		5
Residential real estate		21,717		101		20,541		43		21,379		140		19,011		98		21,549		(15	)		20,307		38			21,198		125		19,388		136
Home equity		5,668		3		6,015		6		5,681		9		5,880		12		5,544		—			5,849		4			5,591		9		5,830		16
Consumer		327		1		380		—		339		1		391		1		411		1			372		1			384		2		381		2
Total nonperforming loans without a specific allowance		37,992		115		37,552		67		38,231		170		38,733		152		38,906		(10	)		38,647		58			38,145		160		38,890		210
With a specific allowance recorded:
Commercial real estate:
Land and construction		—		—		—		—				—		—		—		—		—			—		—			—		—		—		—
Improved property		2,084		—		2,632		—		2,087		—		3,057		—		2,084		—			2,363		—			2,087		—		2,816		—
Commercial and industrial		—		—		—		—		—		—		64		—		—		—			—		—			—		—		48		—
Residential real estate		—		—		—		—		—		—		1,464		—		—		—			—		—			—		—		1,098		—
Home equity		—		—		—		—		—		—		235		—		—		—			—		—			—		—		176		—
Consumer		—		—		—		—		—		—		18		—		—		—			—		—			—		—		13		—
Total nonperforming loans with a specific allowance		2,084		—		2,632		—		2,087		—		4,838		—		2,084		—			2,363		—			2,087		—		4,151		—
Total nonperforming loans	$	40,076	$	115	$	40,184	$	67	$	40,318	$	170	$	43,571	$	152	$	40,990	$	(10	)	$	41,010	$	58		$	40,232	$	160	$	43,041	$	210

The following tables present the recorded investment in non-accrual loans and TDRs:

	Non-accrual Loans ⁽¹⁾				Non-accrual Loans ⁽¹⁾
	June 30,		December 31,		September 30,		December 31,
(unaudited, in thousands)	2021		2020		2021		2020
Commercial real estate:
Land and construction	$	74	$	469	$	145	$	469
Improved property		8,338		9,494		7,572		9,494
Total commercial real estate		8,412		9,963		7,717		9,963
Commercial and industrial		4,572		3,302		5,350		3,302
Residential real estate		17,567		17,925		17,643		17,925
Home equity		5,370		5,345		5,061		5,345
Consumer		291		345		488		345
Total	$	36,212	$	36,880	$	36,259	$	36,880

	TDRs												TDRs
	June 30, 2021						December 31, 2020						September 30, 2021						December 31, 2020
(unaudited, in thousands)	Accruing		Non-Accrual		Total		Accruing		Non-Accrual		Total		Accruing		Non-Accrual		Total		Accruing		Non-Accrual		Total
Commercial real estate:
Land and construction	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—	$	—
Improved property		418		148		566		655		165		820		382		138		520		655		165		820
Total commercial real estate		418		148		566		655		165		820		382		138		520		655		165		820
Commercial and industrial		97		—		97		111		—		111		23		—		23		111		—		111
Residential real estate		4,876		1,255		6,131		2,779		1,354		4,133		3,012		1,213		4,225		2,779		1,354		4,133
Home equity		396		260		656		363		300		663		260		264		524		363		300		663
Consumer		12		1		13		19		9		28		30		—		30		19		9		28
Total	$	5,799	$	1,664	$	7,463	$	3,927	$	1,828	$	5,755	$	3,707	$	1,615	$	5,322	$	3,927	$	1,828	$	5,755

As of ~~June~~September 30, 2021 and December 31, 2020, there ~~was 1 borrower with a loan greater than $1.0 million totaling $1.1 million as compared to~~were 0 TDRs greater than $1.0 ~~million at December 31, 2020.~~million. The concessions granted in the majority of loans reported as accruing and non-accrual TDRs are extensions of the maturity date or the amortization period, reductions in the interest rate below the prevailing market rate for loans with comparable characteristics, and/or permitting interest-only payments for longer than six months. Wesbanco had no unfunded commitments to debtors whose loans were classified as nonperforming as of ~~$0.8 million~~September 30, 2021 and $0.9 million ~~respectively,~~ as of ~~June 30, 2021 and~~ December 31, 2020.

The following tables present details related to loans identified as TDRs during the three and ~~six~~nine months ended ~~June~~September 30, 2021 and 2020, respectively:

	New TDRs (1)												New TDRs (1)
	For the Three Months Ended												For the Three Months Ended
	June 30, 2021						June 30, 2020						September 30, 2021						September 30, 2020
			Pre-		Post-				Pre-		Post-				Pre-		Post-				Pre-		Post-
			Modification		Modification				Modification		Modification				Modification		Modification				Modification		Modification
			Outstanding		Outstanding				Outstanding		Outstanding				Outstanding		Outstanding				Outstanding		Outstanding
	Number of		Recorded		Recorded		Number of		Recorded		Recorded		Number of		Recorded		Recorded		Number of		Recorded		Recorded
(unaudited, dollars in thousands)	Modifications		Investment		Investment		Modifications		Investment		Investment		Modifications		Investment		Investment		Modifications		Investment		Investment
Commercial real estate:
Land and construction		—	$	—	$	—		—	$	—	$	—		—	$	—	$	—		—	$	—	$	—
Improved property		—		—		—		—		—		—		—		—		—		—		—		—
Total commercial real estate		—		—		—		—		—		—		—		—		—		—		—		—
Commercial and industrial		—		—		—		—		—		—		—		—		—		—		—		—
Residential real estate		2		2,041		2,057		—		—		—		1		102		101		—		—		—
Home equity		1		56		56		1		49		48		—		—		—		3		31		30
Consumer		—		—		—		1		8		8		—		—		—		—		—		—
Total		3	$	2,097	$	2,113		2	$	57	$	56		1	$	102	$	101		3	$	31	$	30

	New TDRs (1)												New TDRs (1)
	For the Six Months Ended												For the Nine Months Ended
	June 30, 2021						June 30, 2020						September 30, 2021						September 30, 2020
			Pre-		Post-				Pre-		Post-				Pre-		Post-				Pre-		Post-
			Modification		Modification				Modification		Modification				Modification		Modification				Modification		Modification
			Outstanding		Outstanding				Outstanding		Outstanding				Outstanding		Outstanding				Outstanding		Outstanding
	Number of		Recorded		Recorded		Number of		Recorded		Recorded		Number of		Recorded		Recorded		Number of		Recorded		Recorded
(unaudited, dollars in thousands)	Modifications		Investment		Investment		Modifications		Investment		Investment		Modifications		Investment		Investment		Modifications		Investment		Investment
Commercial real estate:
Land and construction		—	$	—	$	—		—	$	—	$	—		—	$	—	$	—		—	$	—	$	—
Improved property		—		—		—		—		—		—		—		—		—		—		—		—
Total commercial real estate		—		—		—		—		—		—		—		—		—		—		—		—
Commercial and industrial		—		—		—		—		—		—		—		—		—		—		—		—
Residential real estate		2		2,064		2,057		2		332		328		1		103		101		2		332		327
Home equity		1		56		56		1		50		48		1		57		55		4		82		77
Consumer		—		—		—		1		8		8		—		—		—		1		8		7
Total		3	$	2,120	$	2,113		4	$	390	$	384		2	$	160	$	156		7	$	422	$	411

(1) Excludes loans that were either paid off or charged-off by period end. The pre-modification balance represents the balance outstanding at the beginning of the period. The post-modification balance represents the outstanding balance at period end.

The following table summarizes TDRs which defaulted (defined as past due 90 days) during the ~~six~~nine months ended ~~June~~September 30, 2021 and 2020, respectively, that were restructured within the last twelve months prior to ~~June~~September 30, 2021 and 2020, respectively:

	Defaulted TDRs ⁽¹⁾								Defaulted TDRs ⁽¹⁾
	For the Six Months Ended								For the Nine Months Ended
	June 30, 2021				June 30, 2020				September 30, 2021				September 30, 2020
	Number of		Recorded		Number of		Recorded		Number of		Recorded		Number of		Recorded
(unaudited, dollars in thousands)	Defaults		Investment		Defaults		Investment		Defaults		Investment		Defaults		Investment
Commercial real estate:
Land and construction		—	$	—		—	$	—		—	$	—		—	$	—
Improved property		—		—		—		—		—		—		—		—
Total commercial real estate		—		—		—		—		—		—		—		—
Commercial and industrial		—		—		—		—		—		—		—		—
Residential real estate		1		1,106		1		155		1		234		1		155
Home equity		—		—		—		—		—		—		—		—
Consumer		—		—		—		—		—		—		—		—
Total		1	$	1,106		1	$	155		1	$	234		1	$	155

TDRs that default are placed on non-accrual status unless they are both well-secured and in the process of collection. The loans in the table above were not accruing interest.

Section 4013 of the CARES Act allows financial institutions the option to temporarily suspend certain requirements under GAAP related to TDRs for a limited period of time during the COVID-19 pandemic. These customers must meet certain criteria, such as they were in good standing and not more than 30 days past due either as of December 31, 2019, or as of the implementation of the modification program under the Interagency Statement, as well as other requirements noted in the regulatory agencies’ revised statement. Based on this guidance, Wesbanco does not classify the COVID-19 loan modifications as TDRs, nor are the customers considered past due with regard to their delayed payments. Upon exiting the loan modification deferral program, the measurement of loan delinquency will resume where it left off upon entry into the program. Under the CARES Act, Wesbanco has modified approximately 3,553 loans totaling $2.2 billion, of which ~~$151.6~~$132.8 million remain in their deferral period as of ~~June~~September 30, 2021. Wesbanco originally offered three to six months of deferred payments to commercial and retail customers impacted by the COVID-19 pandemic depending on the type of loan and the industry for commercial loans. In the fourth quarter of 2020, Wesbanco offered up to an additional twelve months of deferred payments to certain commercial loan customers, predominantly in the hospitality industry, based on specific criteria related to the borrower, the underlying property and the potential for guarantors / co-borrowers. On December 27, 2020, the Economic Aid to Hard-Hit Small Businesses, Nonprofits and Venues Act (“Economic Aid Act”) was signed into law and among other things, extended the relief granted by the CARES Act for TDRs, initially slated to end on December 31, 2020, by one year to December 31, 2021.

The following tables summarize amortized cost basis loan balances by year of origination and credit quality indicator:

		Loans As of June 30, 2021																			Loans As of September 30, 2021
		Amortized Cost Basis by Origination Year																			Amortized Cost Basis by Origination Year
(unaudited, in thousands)		2021		2020		2019		2018		2017		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term		Total			2021		2020		2019		2018		2017		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term		Total
Commercial real estate: land and construction	Commercial real estate: land and construction																			Commercial real estate: land and construction
Risk rating:
Pass		$	73,210	$	152,277	$	229,044	$	37,823	$	25,554	$	39,097	$	24,592	$	—	$	581,597		$	115,953	$	217,186	$	220,804	$	107,065	$	32,401	$	32,743	$	32,400	$	36,481	$	795,033
Criticized - compromised			—		1,231		—		36		222		2,783		718		—		4,990			217		3,051		1,688		19,835		-		255		764		626		26,436
Classified - substandard			—		—		—		74		—		1,557		—		—		1,631			—		73		—		—		—		1,401		—		1,256		2,730
Classified - doubtful			—		—		—		—		—		—		—		—		—			—		—		—		—		—		—		—		—		—
Total		$	73,210	$	153,508	$	229,044	$	37,933	$	25,776	$	43,437	$	25,310	$	—	$	588,218		$	116,170	$	220,310	$	222,492	$	126,900	$	32,401	$	34,399	$	33,164	$	38,363	$	824,199

Commercial real estate: improved property	Commercial real estate: improved property																			Commercial real estate: improved property
Risk rating:
Pass		$	368,546	$	798,091	$	687,356	$	600,389	$	441,913	$	1,770,502	$	66,697	$	—	$	4,733,494		$	506,709	$	702,779	$	623,518	$	496,064	$	420,887	$	1,665,439	$	63,406	$	23,213	$	4,502,015
Criticized - compromised			—		8,334		95,233		31,599		46,679		101,682		716		—		284,243			2,778		12,367		60,298		11,557		29,539		109,759		824		13,836		240,958
Classified - substandard			—		1,475		8,275		3,747		6,486		79,308		—		—		99,291			4,928		3,155		4,690		1,947		16,774		59,171		—		49		90,714
Classified - doubtful			—		—		—		—		—		—		—		—		—			—		—		—		—		—		—		—		—		—
Total		$	368,546	$	807,900	$	790,864	$	635,735	$	495,078	$	1,951,492	$	67,413	$	—	$	5,117,028		$	514,415	$	718,301	$	688,506	$	509,568	$	467,200	$	1,834,369	$	64,230	$	37,098	$	4,833,687

Commercial and industrial	Commercial and industrial																			Commercial and industrial
Risk rating:
Pass		$	479,447	$	392,500	$	165,745	$	180,175	$	127,825	$	305,290	$	401,860	$	124	$	2,052,966		$	416,053	$	190,262	$	112,982	$	144,588	$	95,428	$	244,890	$	417,565	$	28,981	$	1,650,749
Criticized - compromised			25		3,875		1,805		3,026		2,572		6,689		12,223		—		30,215			239		350		1,271		3,086		2,437	$	1,163		6,964		7,377		22,887
Classified - substandard			—		683		22,989		1,655		1,800		4,940		3,938		—		36,005			108		239		18,603		1,198		2,205	$	2,433		3,520		5,272		33,578
Classified - doubtful			—		—		—		—		—		—		—		—		—			—		—		—		—		—		—		—		—		—
Total		$	479,472	$	397,058	$	190,539	$	184,856	$	132,197	$	316,919	$	418,021	$	124	$	2,119,186		$	416,400	$	190,851	$	132,856	$	148,872	$	100,070	$	248,486	$	428,049	$	41,630	$	1,707,214

Residential real estate	Residential real estate																			Residential real estate
Loan delinquency:
Current		$	201,823	$	386,437	$	181,367	$	105,727	$	81,964	$	653,290	$	—	$	—	$	1,610,608		$	381,939	$	341,539	$	146,234	$	77,809	$	67,661	$	591,263	$	—	$	30,496	$	1,636,941
30-59 days past due			—		—		—		—		—		1,153		—		—		1,153			66		—		—		—		—		2,152		—		—		2,218
60-89 days past due			—		—		—		123		—		2,137		—		—		2,260			111		359		—		122		443		2,461		—		—		3,496
90 days or more past due			—		—		468		268		761		10,114		—		—		11,611			775		823		976		44		761		9,139		—		56		12,574
Total		$	201,823	$	386,437	$	181,835	$	106,118	$	82,725	$	666,694	$	—	$	—	$	1,625,632		$	382,891	$	342,721	$	147,210	$	77,975	$	68,865	$	605,015	$	—	$	30,552	$	1,655,229

Home equity	Home equity																			Home equity
Loan delinquency:
Current		$	14,307	$	8,093	$	2,796	$	2,560	$	756	$	15,620	$	570,646	$	10,395	$	625,173		$	10,630	$	333	$	382	$	254	$	352	$	19,503	$	568,822	$	484	$	600,760
30-59 days past due			—		—		—		12		11		583		1,398		131		2,135			13		—		8		21		16		419		2,516		13		3,006
60-89 days past due			—		—		—		16		—		243		158		—		417			—		—		—		14		—		203		-		23		240
90 days or more past due			—		—		—		7		150		1,525		966		686		3,334			184		68		102		98		254		2,588		-		435		3,729
Total		$	14,307	$	8,093	$	2,796	$	2,595	$	917	$	17,971	$	573,168	$	11,212	$	631,059		$	10,827	$	401	$	492	$	387	$	622	$	22,713	$	571,338	$	955	$	607,735

Consumer	Consumer																			Consumer
Loan delinquency:
Current		$	36,753	$	58,550	$	67,642	$	28,608	$	15,557	$	43,311	$	22,817	$	199	$	273,437		$	48,921	$	50,231	$	58,442	$	22,730	$	13,163	$	37,234	$	50,686	$	28	$	281,435
30-59 days past due			132		496		353		183		102		324		59		—		1,649			396		791		424		225		96		375		221		—		2,528
60-89 days past due			6		201		163		66		89		121		2		—		648			120		134		138		38		11		199		-		—		640
90 days or more past due			—		106		52		21		8		138		10		—		335			59		42		96		27		15		255		4		—		498
Total		$	36,891	$	59,353	$	68,210	$	28,878	$	15,756	$	43,894	$	22,888	$	199	$	276,069		$	49,496	$	51,198	$	59,100	$	23,020	$	13,285	$	38,063	$	50,911	$	28	$	285,101

	Loans As of December 31, 2020
	Amortized Cost Basis by Origination Year
(unaudited, in thousands)	2020		2019		2018		2017		2016		Prior		Revolving Loans Amortized Cost Basis		Revolving Loans Converted to Term		Total
Commercial real estate: land and construction
Risk rating:
Pass	$	133,720	$	314,614	$	109,232	$	27,483	$	16,404	$	29,685	$	26,297	$	—	$	657,435
Criticized - compromised		459		—		1,532		233		79		3,778		1,316		—		7,397
Classified - substandard		—		—		403		58		291		2,693		—		—		3,445
Classified - doubtful		—		—		—		—		—		—		—		—		—
Total	$	134,179	$	314,614	$	111,167	$	27,774	$	16,774	$	36,156	$	27,613	$	—	$	668,277

Commercial real estate: improved property
Risk rating:
Pass	$	809,516	$	670,554	$	646,629	$	474,622	$	572,733	$	1,346,552	$	89,120	$	—	$	4,609,726
Criticized - compromised		2,693		67,261		16,793		59,251		42,284		130,247		1,772		—		320,301
Classified - substandard		102		16,366		4,946		11,647		18,460		55,567		—		—		107,088
Classified - doubtful		—		—		—		—		—		—		—		—		—
Total	$	812,311	$	754,181	$	668,368	$	545,520	$	633,477	$	1,532,366	$	90,892	$	—	$	5,037,115

Commercial and industrial
Risk rating:
Pass	$	977,085	$	240,262	$	193,712	$	160,924	$	85,379	$	265,890	$	427,336	$	136	$	2,350,724
Criticized - compromised		453		2,726		4,206		2,795		324		11,640		12,453		—		34,597
Classified - substandard		—		3,817		1,947		3,771		1,603		5,073		5,906		—		22,117
Classified - doubtful		—		—		—		—		—		—		—		—		—
Total	$	977,538	$	246,805	$	199,865	$	167,490	$	87,306	$	282,603	$	445,695	$	136	$	2,407,438

Residential real estate
Loan delinquency:
Current	$	385,541	$	242,770	$	149,603	$	108,090	$	170,967	$	641,665	$	—	$	—	$	1,698,636
30-59 days past due		—		—		320		533		—		1,761		—		—		2,614
60-89 days past due		—		—		823		—		185		4,646		—		—		5,654
90 days or more past due		—		483		166		761		819		11,828		—		—		14,057
Total	$	385,541	$	243,253	$	150,912	$	109,384	$	171,971	$	659,900	$	—	$	—	$	1,720,961

Home equity
Loan delinquency:
Current	$	18,191	$	3,611	$	3,334	$	975	$	1,110	$	16,477	$	583,486	$	12,135	$	639,319
30-59 days past due		124		—		34		—		—		882		1,247		127		2,414
60-89 days past due		—		—		—		—		—		14		749		12		775
90 days or more past due		—		—		8		156		88		1,786		1,075		766		3,879
Total	$	18,315	$	3,611	$	3,376	$	1,131	$	1,198	$	19,159	$	586,557	$	13,040	$	646,387

Consumer
Loan delinquency:
Current	$	72,847	$	89,637	$	39,584	$	22,118	$	13,144	$	45,735	$	22,253	$	165	$	305,483
30-59 days past due		481		408		210		311		194		379		15		—		1,998
60-89 days past due		273		147		84		100		163		253		11		—		1,031
90 days or more past due		113		72		73		31		12		242		—		—		543
Total	$	73,714	$	90,264	$	39,951	$	22,560	$	13,513	$	46,609	$	22,279	$	165	$	309,055

The following table summarizes other real estate owned and repossessed assets included in other assets:

	June 30,		December 31,		September 30,		December 31,
(unaudited, in thousands)	2021		2020		2021		2020
Other real estate owned	$	754	$	504	$	293	$	504
Repossessed assets		19		45		—		45
Total other real estate owned and repossessed assets	$	773	$	549	$	293	$	549

Residential real estate included in other real estate owned was $0.2 and $0.1 million at ~~June~~September 30, 2021 and December 31, ~~2020.~~2020, respectively. At ~~June~~September 30, 2021 and December 31, 2020, formal foreclosure proceedings were in process on residential real estate loans totaling $1.9 million and $1.8 million, ~~at each period.~~respectively. As a result of provisions of the CARES Act, certain residential real estate loans are temporarily suspended from entering foreclosure proceedings. The balance of these loans totaled ~~$2.6~~$3.6 million and $2.3 million at ~~June~~September 30, 2021 and December 31, 2020, respectively.

Wesbanco is exposed to certain risks arising from both its business operations and economic conditions. Wesbanco principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. Wesbanco manages economic risks, including interest rate, liquidity, and credit risk, primarily by managing the amount, sources, and duration of its assets and liabilities. Wesbanco’s existing interest rate derivatives result from a service provided to certain qualifying customers and, therefore, are not used to manage interest rate risk in Wesbanco’s assets or liabilities. Wesbanco manages a matched book with respect to its derivative instruments in order to minimize its net risk exposure resulting from such transactions. A matched book is when Wesbanco Bank, Inc.’s (the “Bank”) assets and liabilities are equally distributed but also have similar maturities.

Wesbanco executes interest rate swaps with commercial banking customers to facilitate their respective risk management strategies. Those interest rate swaps are simultaneously hedged by offsetting interest rate swaps that Wesbanco executes with a third party, such that Wesbanco minimizes its net risk exposure resulting from such transactions. As the interest rate swaps associated with this program do not meet the strict hedge accounting requirements of ASC 815, changes in the fair value of both the customer swaps and the offsetting third-party swaps are recognized directly in earnings. As of ~~June~~September 30, 2021 and December 31, 2020, Wesbanco had ~~129~~130 and 112 ~~respectively,~~ customer interest rate swaps with an aggregate notional amount of ~~$723.7~~$696.0 million and $649.9 million, respectively, related to this program. Wesbanco recognized income for the related swap fees of ~~$1.0~~$0.4 million and ~~$3.5~~$0.9 million for the three months ended ~~June~~September 30, 2021 and 2020, respectively and ~~$2.9~~$3.3 million and ~~$6.1~~$7.0 million for the ~~six~~nine months ended ~~June~~September 30, 2021 and 2020, respectively.

Risk participation agreements are entered into as financial guarantees of performance on interest rate swap derivatives. The purchased asset or sold liability allows Wesbanco to participate-in (fee received) or participate-out (fee paid) the risk associated with certain derivative positions executed by the borrower of the lead bank in a loan syndication. As of ~~June~~September 30, 2021 and December 31, 2020, Wesbanco had 1314 and 12, ~~respectively,~~ risk participation-in agreements with an aggregate notional amount of ~~$118.5~~$132.4 million and $101.1 million, respectively. As of ~~June~~September 30, 2021 and December 31, 2020, Wesbanco had 1 risk participation-out agreement with an aggregate notional amount of $9.9 million and $10.0 ~~million.~~million, respectively.

Certain residential mortgage loans are originated for sale in the secondary mortgage loan market. These loans are classified as held for sale and carried at fair value as Wesbanco has elected the fair value option. Fair value is determined based on rates obtained from the secondary market for loans with similar characteristics. Wesbanco sells loans to the secondary market on either a mandatory or best efforts basis. The loans sold on a mandatory basis are not committed to an investor until the loan is closed with the borrower. Wesbanco enters into forward to be announced (“TBA”) contracts to manage the interest rate risk between the loan commitment and the closing of the loan. The total balance of forward TBA contracts entered into was ~~$83.0~~$65.2 million and $183.5 million at ~~June~~September 30, 2021 and December 31, 2020, respectively. The loans sold on a best efforts basis are committed to an investor simultaneous to the interest rate commitment with the borrower, and as a result, the Company does not enter into a separate forward TBA contract to offset the fair value risk as the investor accepts such risk in exchange for paying a lower premium on sale.

All derivatives are carried on the consolidated balance sheet at fair value. Derivative assets are classified in the consolidated balance sheet under other assets, and derivative liabilities are classified in the consolidated balance sheet under other liabilities. Changes in fair value are recognized in earnings. None of Wesbanco’s derivatives are designated in a qualifying hedging relationship under ASC 815.

The table below presents the fair value of Wesbanco’s derivative financial instruments as well as their classification on the Balance Sheet as of ~~June~~September 30, 2021 and December 31, 2020:

	June 30, 2021						December 31, 2020						September 30, 2021						December 31, 2020
(unaudited, in thousands)	Notional or Contractual Amount		Asset Derivatives		Liability Derivatives		Notional or Contractual Amount		Asset Derivatives		Liability Derivatives		Notional or Contractual Amount		Asset Derivatives		Liability Derivatives		Notional or Contractual Amount		Asset Derivatives		Liability Derivatives
Derivatives
Loan Swaps:
Interest rate swaps	$	723,672	$	30,394	$	32,165	$	649,857	$	46,418	$	49,917	$	696,029	$	27,121	$	28,513	$	649,857	$	46,418	$	49,917
Other contracts:
Interest rate loan commitments		52,346		250		—		112,119		702		—		50,146		24		—		112,119		702		—
Forward TBA contracts		83,000		66		—		183,500	—			1,161		65,221		201		—		183,500	—			1,161
Total derivatives			$	30,710	$	32,165			$	47,120	$	51,078			$	27,346	$	28,513			$	47,120	$	51,078

The table below presents the change in the fair value of the Company’s derivative financial instruments reflected within non-interest income on the consolidated income statement for the three and ~~six~~nine months ended ~~June~~September 30, 2021 and 2020, respectively.

		For the Three Months Ended June 30,						For the Six Months Ended June 30,							For the Three Months Ended September 30,						For the Nine Months Ended September 30,
(unaudited, in thousands)	Location of Gain/(Loss)	2021			2020			2021			2020			Location of Gain/(Loss)	2021			2020			2021			2020
Interest rate swaps	Other income	$	(1,033	)	$	(501	)	$	1,728		$	(3,252	)	Other income	$	378		$	420		$	2,106		$	(2,832	)
Interest rate loan commitments	Mortgage banking income		564			1,290			(452	)		1,145		Mortgage banking income		(226	)		48			(678	)		1,193
Forward TBA contracts	Mortgage banking income		(1,619	)		(1,191	)		2,899			(3,848	)	Mortgage banking income		(278	)		(1,653	)		2,621			(5,501	)
Total		$	(2,088	)	$	(402	)	$	4,175		$	(5,955	)		$	(126	)	$	(1,185	)	$	4,049		$	(7,140	)

Wesbanco has agreements with its derivative counterparties that contain a provision, which provides that if Wesbanco defaults on any of its indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, then Wesbanco could also be declared in default on its derivative obligations.

Wesbanco also has agreements with certain of its derivative counterparties that contain a provision where if Wesbanco fails to maintain its status as either a “well” or “adequately-capitalized” institution, then the counterparty could terminate the derivative positions and Wesbanco would be required to settle its obligations under the agreements.

Wesbanco had minimum collateral posting thresholds with certain of its derivative counterparties and has posted collateral with a market value of ~~$63.7~~$58.0 million as of ~~June~~September 30, 2021. If Wesbanco had breached any of these provisions at ~~June~~September 30, 2021, it could have been required to settle its obligations under the agreements at the termination value and would have been required to pay any additional amounts due in excess of amounts previously posted as collateral with the respective counterparty.

The following table presents the net periodic pension income for Wesbanco’s Defined Benefit Pension Plan (the “Plan”) and the related components:

	For the Three Months Ended June 30,						For the Six Months Ended June 30,						For the Three Months Ended September 30,						For the Nine Months Ended September 30,
(unaudited, in thousands)	2021			2020			2021			2020			2021			2020			2021			2020
Service cost – benefits earned during year	$	623		$	568		$	1,239		$	1,136		$	630		$	574		$	1,869		$	1,710
Interest cost on projected benefit obligation		852			1,121			1,694			2,242			861			1,133			2,555			3,375
Expected return on plan assets		(2,794	)		(2,594	)		(5,557	)		(5,188	)		(2,825	)		(2,622	)		(8,382	)		(7,810	)
Amortization of prior service cost		(9	)		(9	)		(17	)		(18	)		(9	)		(9	)		(26	)		(27	)
Amortization of net loss		682			794			1,357			1,587			690			802			2,047			2,389
Net periodic pension income	$	(646	)	$	(120	)	$	(1,284	)	$	(241	)	$	(653	)	$	(122	)	$	(1,937	)	$	(363	)

The service cost of ~~$1.2~~$1.9 million and ~~$1.1~~$1.7 million for ~~both~~ the ~~six~~nine months ended ~~June~~September 30, 2021 and 2020, respectively, is included in salaries and wages, and the periodic pension income of ~~$2.5~~$3.8 million and ~~$1.4~~$2.1 million for the ~~six~~nine months ended ~~June~~September 30, 2021 and 2020, respectively, is included in employee benefits.

The Plan covers all employees of Wesbanco and its subsidiaries who were hired on or before August 1, 2007 who satisfy minimum age and length of service requirements, and is not available to employees hired after such date.

A minimum required contribution of $5.2 million is due for 2021, which can be offset in whole or in part by the Plan’s $64.2 million available credit balance. Wesbanco currently does 0t expect to make a voluntary contribution to the Plan in 2021.

Fair value estimates are based on quoted market prices, if available, quoted market prices of similar assets or liabilities, or the present value of expected future cash flows and other valuation techniques. These valuations are significantly affected by discount rates, cash flow assumptions, and risk assumptions used. Therefore, fair value estimates may not be substantiated by comparison to independent markets and are not intended to reflect the proceeds that may be realizable in an immediate settlement of the instruments.

Fair value is determined at one point in time and is not representative of future value. These amounts do not reflect the total value of a going concern organization. Management does not have the intention to dispose of a significant portion of its assets and liabilities, and therefore the unrealized gains or losses should not be interpreted as a forecast of future earnings and cash flows.

The following is a discussion of assets and liabilities measured at fair value on a recurring basis and valuation techniques applied:

Investment securities: The fair value of investment securities which are measured on a recurring basis are determined primarily by obtaining quoted prices on nationally recognized securities exchanges or matrix pricing, which is a mathematical technique used widely in the industry to value debt securities without relying exclusively on quoted prices for the specific securities but rather by relying on the securities’ relationship to other similar securities. These securities are classified within level 1 or 2 in the fair value hierarchy. Positions that are not traded in active markets for which valuations are generated using assumptions not observable in the market or management’s best estimate are classified within level 3 of the fair value hierarchy. This includes certain specific municipal debt issues for which the credit quality and discount rate must be estimated.

Loans held for sale: Loans held for sale are carried, in aggregate, at fair value as Wesbanco previously elected the fair value option. The use of a valuation model using quoted prices of similar instruments are significant inputs in arriving at the fair value and therefore loans held for sale are classified within level 2 of the fair value hierarchy.

Derivatives: Wesbanco enters into interest rate swap agreements with qualifying commercial customers to meet their financing, interest rate and other risk management needs. These agreements provide the customer the ability to convert from variable to fixed interest rates. The credit risk associated with derivatives executed with customers is essentially the same as that involved in extending loans and is subject to normal credit policies and monitoring. Those interest rate swaps are economically hedged by offsetting interest rate swaps that Wesbanco executes with derivative counterparties in order to offset its exposure on the fixed components of the customer interest rate swap agreements. The interest rate swap agreement with the loan customer and with the counterparty is reported at fair value in other assets and other liabilities on the consolidated balance sheet with any resulting gain or loss recorded in current period earnings as other income and other expense.

Wesbanco enters into forward TBA contracts to manage the interest rate risk between the loan commitments to the customer and the closing of the loan for loans that will be sold on a mandatory basis to secondary market investors. The forward TBA contract is reported at fair value in other assets and other liabilities on the consolidated balance sheet with any resulting gain or loss recorded in current period’s earnings as mortgage banking income.

Wesbanco determines the fair value for derivatives using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects contractual terms of the derivative, including the period to maturity, and uses observable market-based inputs, including interest rate curves and implied volatilities. Wesbanco incorporates credit valuation adjustments to appropriately reflect both its own non-performance risk and the respective counterparty’s non-performance risk in the fair value measurements.

We may be required from time to time to measure certain assets and liabilities at fair value on a nonrecurring basis in accordance with GAAP. These adjustments to fair value usually result from the application of lower of cost or market accounting or write-downs of individual assets and liabilities.

Individually-evaluated ~~nonperforming~~ loans: Individually-evaluated ~~non-performing~~ loans are carried at the amortized cost basis less the specific allowance calculated under CECL. ~~Since these~~Individually-evaluated loans ~~are nonperforming, cash flows could not be estimated and thus~~ are calculated using a cost basis approach or collateral value approach.

Other real estate owned and repossessed assets: Other real estate owned and repossessed assets are carried at the lower of the investment in the assets or the fair value of the assets less estimated selling costs. The use of independent appraisals and management’s best judgment are significant inputs in arriving at the fair value measure of the underlying collateral, and therefore other real estate owned and repossessed assets are classified within level 3 of the fair value hierarchy.

The fair value amounts presented in the table below are intended to permit reconciliation of the fair value hierarchy to the amounts presented in the statement of financial position. The following tables set forth Wesbanco’s financial assets and liabilities that were accounted for at fair value on a recurring and nonrecurring basis by level within the fair value hierarchy as of ~~June~~September 30, 2021 and December 31, 2020:

			June 30, 2021								September 30, 2021
			Fair Value Measurements Using:								Fair Value Measurements Using:
	June 30,		Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs		September 30,		Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
(unaudited, in thousands)	2021		(level 1)		(level 2)		(level 3)		2021		(level 1)		(level 2)		(level 3)
Recurring fair value measurements
Equity securities	$	13,494	$	13,494	$	—	$	—	$	13,451	$	13,451	$	—	$	—
Available-for-sale debt securities
U.S. Treasury		19,998		—		19,998		—		10,000		—		10,000		—
U.S. Government sponsored entities and agencies		212,490		—		212,490		—		233,435		—		233,435		—
Residential mortgage-backed securities and collateralized mortgage obligations of government sponsored entities and agencies		2,280,766		—		2,280,766		—		2,294,456		—		2,294,456		—
Commercial mortgage-backed securities and collateralized mortgage obligations of government sponsored entities and agencies		316,285		—		316,285		—		321,549		—		321,549		—
Obligations of states and political subdivisions		110,097		—		108,574		1,523		109,821		—		108,327		1,494
Corporate debt securities		24,628		—		24,628		—		17,542		—		17,542		—
Total available-for-sale debt securities	$	2,964,264	$	—	$	2,962,741	$	1,523	$	2,986,803	$	—	$	2,985,309	$	1,494
Loans held for sale		41,461		—		41,461		—		32,308		—		32,308		—
Other assets - interest rate derivatives agreements		30,394		—		30,394		—		27,121		—		27,121		—
Total assets recurring fair value measurements	$	3,049,613	$	13,494	$	3,034,596	$	1,523	$	3,059,683	$	13,451	$	3,044,738	$	1,494

Other liabilities - interest rate derivatives agreements	$	32,165	$	—	$	32,165	$	—	$	28,513	$	—	$	28,513	$	—
Total liabilities recurring fair value measurements	$	32,165	$	—	$	32,165	$	—	$	28,513	$	—	$	28,513	$	—

Nonrecurring fair value measurements
Individually-evaluated nonperforming loans	$	1,870	$	—	$	—	$	1,870
Individually-evaluated loans									$	22,316	$	—	$	—	$	22,316
Other real estate owned and repossessed assets		773		—		—		773		293		—		—		293
Total nonrecurring fair value measurements	$	2,643	$	—	$	—	$	2,643	$	22,609	$	—	$	—	$	22,609

			December 31, 2020								December 31, 2020
			Fair Value Measurements Using:								Fair Value Measurements Using:
	December 31,		Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs		December 31,		Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
(in thousands)	2020		(level 1)		(level 2)		(level 3)		2020		(level 1)		(level 2)		(level 3)
Recurring fair value measurements
Equity securities	$	13,047	$	13,047	$	—	$	—	$	13,047	$	13,047	$	—	$	—
Available-for-sale debt securities
U.S. Treasury		39,982		—		39,982		—		39,982		—		39,982		—
U.S. Government sponsored entities and agencies		211,682		—		211,682		—		211,682		—		211,682		—
Residential mortgage-backed securities and collateralized mortgage obligations of government sponsored entities and agencies		1,264,737		—		1,264,737		—		1,264,737		—		1,264,737		—
Commercial mortgage-backed securities and collateralized mortgage obligations of government sponsored entities and agencies		320,098		—		320,098		—		320,098		—		320,098		—
Obligations of states and political subdivisions		115,762		—		114,227		1,535		115,762		—		114,227		1,535
Corporate debt securities		25,875		—		25,875		—		25,875		—		25,875		—
Total available-for-sale debt securities	$	1,978,136	$	—	$	1,976,601	$	1,535	$	1,978,136	$	—	$	1,976,601	$	1,535
Loans held for sale		168,378		—		168,378		—		168,378		—		168,378		—
Other assets - interest rate derivatives agreements		46,418		—		46,418		—		46,418		—		46,418		—
Total assets recurring fair value measurements	$	2,205,979	$	13,047	$	2,191,397	$	1,535	$	2,205,979	$	13,047	$	2,191,397	$	1,535

Other liabilities - interest rate derivatives agreements	$	49,917	$	—	$	49,917	$	—	$	49,917	$	—	$	49,917	$	—
Total liabilities recurring fair value measurements	$	49,917	$	—	$	49,917	$	—	$	49,917	$	—	$	49,917	$	—

Nonrecurring fair value measurements
Individually-evaluated nonperforming loans	$	1,958	$	—	$	—	$	1,958
Individually-evaluated loans									$	1,958	$	—	$	—	$	1,958
Other real estate owned and repossessed assets		549		—		—		549		549		—		—		549
Total nonrecurring fair value measurements	$	2,507	$	—	$	—	$	2,507	$	2,507	$	—	$	—	$	2,507

Wesbanco’s policy is to recognize transfers between levels as of the actual date of the event or change in circumstances that caused the transfer. There were 0 significant transfers between level 1, 2 or 3 for the three and ~~six~~nine months ended ~~June~~September 30, 2021 or for the year ended December 31, 2020.

The following table presents additional quantitative information about assets measured at fair value on a nonrecurring basis and for which Wesbanco has utilized level 3 inputs to determine fair value:

Quantitative Information about Level 3 Fair Value Measurements

Fair Value

Valuation

Unobservable

Range (Weighted

Fair Value

Valuation

Unobservable

Range (Weighted

(unaudited, in thousands)

Estimate

Techniques

Input

Average)

Estimate

Techniques

Input

Average)

June 30, 2021

Individually-evaluated nonperforming loans

1,870

Appraisal of collateral ⁽¹⁾

Appraisal adjustments ⁽²⁾

(30.0%)/(30.0%)

September 30, 2021

Individually-evaluated loans

22,316

Appraisal of collateral ⁽¹⁾

Appraisal adjustments ⁽²⁾

(20.0%) to (30.0%)/(21.6%)

Liquidation expenses ⁽²⁾

(5.6%)/(5.6%)

Liquidation expenses ⁽²⁾

(5.6%) to (6.4%)/(6.3%)

Other real estate owned and repossessed assets

773

Appraisal of collateral ^{(1), (3)}

293

Appraisal of collateral ^{(1), (3)}

December 31, 2020

Individually-evaluated nonperforming loans

1,958

Appraisal of collateral ⁽¹⁾

Appraisal adjustments ⁽²⁾

(30.0%)/(30.0%)

Individually-evaluated loans

1,958

Appraisal of collateral ⁽¹⁾

Appraisal adjustments ⁽²⁾

(30.0%)/(30.0%)

Liquidation expenses ⁽²⁾

(5.6%)/(5.6%)

Liquidation expenses ⁽²⁾

(5.6%)/(5.6%)

Other real estate owned and repossessed assets

549

Appraisal of collateral ^{(1), (3)}

549

Appraisal of collateral ^{(1), (3)}

The estimated fair values of Wesbanco’s financial instruments are summarized below:

					Fair Value Measurements at										Fair Value Measurements at
					June 30, 2021										September 30, 2021
	Carrying		Fair Value		Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs		Carrying		Fair Value		Quoted Prices in Active Markets for Identical Assets		Significant Other Observable Inputs		Significant Unobservable Inputs
(unaudited, in thousands)	Amount		Estimate		(level 1)		(level 2)		(level 3)		Amount		Estimate		(level 1)		(level 2)		(level 3)
Financial Assets
Cash and due from banks	$	846,304	$	846,304	$	846,304	$	—	$	—	$	1,121,116	$	1,121,116	$	1,121,116	$	—	$	—
Equity securities		13,494		13,494		13,494		—		—		13,451		13,451		13,451		—		—
Available-for-sale debt securities		2,964,264		2,964,264		—		2,962,741		1,523		2,986,803		2,986,803		—		2,985,309		1,494
Net held-to-maturity debt securities		901,945		934,487		—		934,050		437		953,663		978,494		—		978,060		434
Net loans		10,216,462		10,174,345		—		—		10,174,345		9,776,560		9,563,549		—		—		9,563,549
Loans held for sale		41,461		41,461		—		41,461		—		32,308		32,308		—		32,308		—
Other assets - interest rate derivatives		30,394		30,394		—		30,394		—		27,121		27,121		—		27,121		—
Accrued interest receivable		64,020		64,020		64,020		—		—		61,895		61,895		61,895		—		—

Financial Liabilities
Deposits		13,318,255		13,330,251		11,833,719		1,496,532		—		13,423,314		13,434,258		12,069,062		1,365,196		—
Federal Home Loan Bank borrowings		313,960		316,762		—		316,762		—		208,940		210,881		—		210,881		—
Other borrowings		135,267		125,562		125,562		—		—		152,546		141,471		141,471		—		—
Subordinated debt and junior subordinated debt		192,571		175,362		—		108,741		66,621		167,711		144,341		—		109,186		35,155
Other liabilities - interest rate derivatives		32,165		32,165		—		32,165		—		28,513		28,513		—		28,513		—
Accrued interest payable		3,342		3,342		3,342		—		—		2,495		2,495		2,495		—		—

The following methods and assumptions were used to measure the fair value of financial instruments recorded at cost on Wesbanco’s consolidated balance sheets:

Cash and due from banks: The carrying amount for cash and due from banks is a reasonable estimate of fair value.

Held-to-maturity debt securities: Fair values for debt securities held-to-maturity are determined in the same manner as investment securities, which are described above.

Net loans: Fair values for loans are estimated using a discounted cash flow methodology. The discount rates take into account interest rates currently being offered to customers for loans with similar terms, the credit risk associated with the loan and other market factors, including liquidity. Wesbanco believes the discount rates are consistent with transactions occurring in the marketplace for both performing and distressed loan types. The carrying value is net of the allowance for loan losses and other associated premiums and discounts. Due to the significant judgment involved in evaluating credit quality, loans are classified within level 3 of the fair value hierarchy.

Accrued interest receivable: The carrying amount of accrued interest receivable approximates its fair value.

Deposits: The carrying amount is considered a reasonable estimate of fair value for demand, savings and other variable rate deposit accounts. The fair value of fixed maturity certificates of deposit is estimated by a discounted cash flow method using rates currently offered for deposits of similar remaining maturities.

Federal Home Loan Bank borrowings: The fair value of FHLB borrowings is based on rates currently available to Wesbanco for borrowings with similar terms and remaining maturities.

Other borrowings: The carrying amount of federal funds purchased and overnight sweep accounts generally approximate fair value. Other repurchase agreements are based on quoted market prices if available. If market prices are not available, for certain fixed and adjustable rate repurchase agreements, then quoted market prices of similar instruments are used.

Subordinated debt and junior subordinated debt: The fair value of subordinated debt is estimated using discounted cash flow analyses based on the current borrowing rates for similar types of borrowing arrangements. Due to the pooled nature of junior subordinated debt owed to unconsolidated subsidiary trusts, which are not actively traded, estimated fair value is based on recent similar transactions of single-issuer trust preferred securities.

Accrued interest payable: The carrying amount of accrued interest payable approximates its fair value.

Off-balance sheet financial instruments: Off-balance sheet financial instruments consist of commitments to extend credit, including letters of credit. Fair values for commitments to extend credit are estimated using the fees currently charged to enter into similar agreements, taking into account the remaining terms of the agreements and the present credit standing of the counterparties. The estimated fair value of the commitments to extend credit and letters of credit are insignificant and therefore are not presented in the above tables.

Interest income, net securities gains (losses) and bank-owned life insurance are not in scope of ASC 606, Revenue from Contracts with Customers. For the revenue streams in scope of ASC 606 - trust fees, service charges on deposits, net securities brokerage revenue, debit card sponsorship income, payment processing fees, electronic banking fees, mortgage banking income and net gain or loss on sale of other real estate owned and other assets – there are no significant judgements related to the amount and timing of revenue recognition.

Trust fees: Fees are earned over a period of time between monthly and annually, per the related fee schedule. The fees are earned ratably over the period for investment, safekeeping and other services performed by Wesbanco. The fees are accrued when earned based on the daily asset value on the last day of the quarter. In most cases, the fees are directly debited from the customer account. WesMark fees consist of investment advisory fees and shareholder service fees and are paid to Wesbanco by the WesMark mutual funds on a monthly basis for Wesbanco’s involvement with the management of the funds.

Service charges on deposits: There are monthly service charges for both commercial and personal banking customers, which are earned over the month per the related fee schedule based on the customers’ deposits. There are also transaction-based fees, which are earned based on specific transactions or customer activity within the customers’ deposit accounts. These are earned at the time the transaction or customer activity occurs. The fees are debited from the customer account.

Net securities brokerage revenue: Commission income is earned based on customer transactions and management of investments. The commission income from customers’ transactions is recognized when the transaction is complete and approved. Annuity commissions are earned based upon the carrier’s commission rate for the annuity product chosen by the investing customer. The commission income from the management of investments over time is earned continuously over a quarterly period.

Debit card sponsorship income: The activity in this revenue stream concluded on March 31, 2021, with the sale of this program to another bank. Debit card sponsorship income was earned from Wesbanco’s sponsorship of its customers, which included independent service organizations, processors and other banks into different debit networks. For providing this service, the customers paid the bank a per transaction fee for each transaction processed through the network. In some cases, customers were also charged annual sponsorship fees and non-compliance fees as applicable. The fees were earned at the time the transaction or customer activity occurred. The fees were either directly debited from the customers' deposit accounts or were billed to the customer.

Payment processing fees: Payment processing fees are earned from the bill payment and electronic funds transfer (“EFT”) services provided under the name FirstNet. The fees are derived from both the individual consumer banking transactions and from businesses or service providers through monthly billing for total transactions occurring. These fees are earned at the time the transaction or customer activity occurs. The fees are debited from the customers’ deposit accounts or charged directly to the business or service provider.

Electronic banking fees: Interchange and ATM fees are earned based on customer and ATM transactions. Revenue is recognized when the transaction is settled.

Mortgage banking income: Income is earned when Wesbanco-originated loans are sold to an investor on the secondary market. The investor bids on the loans. If the price is accepted, Wesbanco delivers the loan documents to the investor. Once received and approved by the investor, revenue is recognized and the loans are derecognized from the Consolidated Balance Sheet. Prior to the loans being sold, they are classified as loans held for sale. Additionally, the changes in the fair value of the loans held for sale, loan commitments and related derivatives are included in mortgage banking income and are slightly offset by any deferred direct origination costs, such as mortgage loan officer commissions.

Net gain or loss on sale of other real estate owned and other assets: Net gain or loss on other real estate owned is recorded when the property is sold to a third party and the Bank collects substantially all of the consideration to which it is entitled in exchange for the transfer of the property. Net gain or loss on other assets can include, among other things, the sale of fixed assets, the change in fair value of the underlying investments funded by Wesbanco’s Community Development Corporation (“Wesbanco CDC”) and residual income earned from the sale of Wesbanco’s debit card sponsorship program. Gains or losses are recognized upon receipt of consideration and subsequent transfer of the property for fixed asset sales. The change in fair value of Wesbanco CDC investments occurs upon the change in the underlying investments as these are accounted for utilizing the equity method, and as such, are not within the scope of ASC 606. Residual income from the sale of the debit card sponsorship program is recognized over time per the signed agreement between Wesbanco and the buyer.

The following table summarizes the point of revenue recognition and the income recognized for each of the revenue streams for the three and ~~six~~nine months ended ~~June~~September 30, 2021 and 2020, respectively:

	Point of Revenue	For the Three Months Ended June 30,					For the Six Months Ended June 30,				Point of Revenue	For the Three Months Ended September 30,					For the Nine Months Ended September 30,
(unaudited, in thousands)	Recognition	2021		2020			2021		2020		Recognition	2021		2020			2021		2020
Revenue Streams
Trust fees
Trust account fees	Over time	$	4,710	$	4,189		$	10,024	$	9,046	Over time	$	4,768	$	4,225		$	14,792	$	13,271
WesMark fees	Over time		2,438		2,013			4,756		4,108	Over time		2,521		2,201			7,277		6,309
Total trust fees			7,148		6,202			14,780		13,154			7,289		6,426			22,069		19,580
Service charges on deposits
Commercial banking fees	Over time		601		586			1,165		1,171	Over time		464		576			1,629		1,748
Personal service charges	At a point in time and over time		4,275		3,737			8,605		9,769	At a point in time and over time		5,586		4,756			14,191		14,524
Total service charges on deposits			4,876		4,323			9,770		10,940			6,050		5,332			15,820		16,272
Net securities brokerage revenue
Annuity commissions	At a point in time		1,151		845			2,067		1,883	At a point in time		1,169		1,218			3,237		3,101
Equity and debt security trades	At a point in time		57		94			133		253	At a point in time		73		27			206		280
Managed money	Over time		291		214			574		449	Over time		311		248			885		697
Trail commissions	Over time		330		131			578		478	Over time		412		232			990		709
Total net securities brokerage revenue			1,829		1,384			3,352		3,063			1,965		1,725			5,318		4,787

Debit card sponsorship income (1)	At a point in time and over time		—		644			646		1,351	At a point in time and over time		—		751			646		2,102
Payment processing fees (1)	At a point in time and over time		748		784			1,461		1,464	At a point in time and over time		773		669			2,234		2,133
Electronic banking fees	At a point in time		5,060		4,066			9,426		8,320	At a point in time		5,427		4,780			14,853		13,100
Mortgage banking income	At a point in time		7,830		7,531			12,094		8,807	At a point in time		4,563		8,488			16,656		17,295
Net gain (loss) on other real estate owned and other assets (2)	At a point in time and over time		4,014		(66	)		4,189		103	At a point in time and over time		785		(19	)		4,974		84

The activity in accumulated other comprehensive income for the ~~six~~nine months ended ~~June~~September 30, 2021 and 2020 is as follows:

	Accumulated Other Comprehensive Income/(Loss)⁽¹⁾												Accumulated Other Comprehensive Income/(Loss)⁽¹⁾
(unaudited, in thousands)	Defined Benefit Plans			Unrealized Gains (Losses) on Debt Securities Available-for-Sale			Unrealized Gains on Debt Securities Transferred from Available-for-Sale to Held-to-Maturity			Total			Defined Benefit Plans			Unrealized Gains (Losses) on Debt Securities Available-for-Sale			Unrealized Gains on Debt Securities Transferred from Available-for-Sale to Held-to-Maturity			Total
Balance at December 31, 2020	$	(15,502	)	$	46,861		$	—		$	31,359		$	(15,502	)	$	46,861		$	—		$	31,359
Other comprehensive income/(loss) before reclassifications		—			(19,696	)		—			(19,696	)		—			(28,292	)		—			(28,292	)
Amounts reclassified from accumulated other comprehensive income/(loss)		949			(26	)		—			923			1,431			(35	)		—			1,396
Period change		949			(19,722	)		—			(18,773	)		1,431			(28,327	)		—			(26,896	)
Balance at June 30, 2021	$	(14,553	)	$	27,139		$	—		$	12,586
Balance at September 30, 2021													$	(14,071	)	$	18,534		$	—		$	4,463

Balance at December 31, 2019	$	(17,468	)	$	18,644		$	25		$	1,201		$	(17,468	)	$	18,644		$	25		$	1,201
Other comprehensive income/(loss) before reclassifications	—				40,091		—				40,091		—				37,340		—				37,340
Amounts reclassified from accumulated other comprehensive income/(loss)		1,137			(1,906	)		(7	)		(776	)		1,712			(1,940	)		(12	)		(240	)
Period change		1,137			38,185			(7	)		39,315			1,712			35,400			(12	)		37,100
Balance at June 30, 2020	$	(16,331	)	$	56,829		$	18		$	40,516
Balance at September 30, 2020													$	(15,756	)	$	54,044		$	13		$	38,301

The following table provides details about amounts reclassified from accumulated other comprehensive income for the three and ~~six~~nine months ended ~~June~~September 30, 2021 and 2020:

Details about Accumulated Other Comprehensive Income/(Loss) Components	For the Three Months Ended June 30,						For the Six Months Ended June 30,						Affected Line Item in the Statement of Comprehensive Income	For the Three Months Ended September 30,						For the Nine Months Ended September 30,						Affected Line Item in the Statement of Comprehensive Income
(unaudited, in thousands)	2021			2020			2021			2020				2021			2020			2021			2020
Debt securities available-for-sale ⁽¹⁾:
Net securities gains reclassified into earnings	$	(31	)	$	(213	)	$	(34	)	$	(2,500	)	Net securities gains (Non-interest income)	$	(12	)	$	(45	)	$	(46	)	$	(2,545	)	Net securities gains (Non-interest income)
Related income tax expense ⁽²⁾		7			51			8			594		Provision for income taxes		3			11			11			605		Provision for income taxes
Net effect on accumulated other comprehensive income for the period		(24	)		(162	)		(26	)		(1,906	)			(9	)		(34	)		(35	)		(1,940	)

Debt securities held-to-maturity ⁽¹⁾:
Amortization of unrealized gain transferred from available-for-sale		—			(7	)		—			(10	)	Interest and dividends on securities (Interest and dividend income)		—			(5	)		—			(15	)	Interest and dividends on securities (Interest and dividend income)
Related income tax expense ⁽²⁾		—			2			—			3		Provision for income taxes		—			1			—			3		Provision for income taxes
Net effect on accumulated other comprehensive income for the period		—			(5	)		—			(7	)			—			(4	)		—			(12	)

Defined benefit plans ⁽³⁾:
Amortization of net loss and prior service costs		628			746			1,250			1,492		Employee benefits (Non-interest expense)		635			746			1,886			2,246		Employee benefits (Non-interest expense)
Related income tax benefit ⁽²⁾		(151	)		(177	)		(301	)		(355	)	Provision for income taxes		(153	)		(177	)		(455	)		(534	)	Provision for income taxes
Net effect on accumulated other comprehensive income for the period		477			569			949			1,137				482			569			1,431			1,712
Total reclassifications for the period	$	453		$	402		$	923		$	(776	)		$	473		$	531		$	1,396		$	(240	)

Commitments — In the normal course of business, Wesbanco offers off-balance sheet credit arrangements to enable its customers to meet their financing objectives. Those instruments involve, to varying degrees, elements of credit and interest rate risk in excess of the amount recognized in the financial statements. Wesbanco’s exposure to credit losses in the event of non-performance by the other parties to the financial instruments for commitments to extend credit and standby letters of credit is limited to the contractual amount of those instruments. Wesbanco uses the same credit policies in making commitments and conditional obligations as for all other lending. Commitments generally have fixed expiration dates or other termination clauses and may require payment of a fee. Since many of the commitments are expected to expire without being drawn upon, the total commitment amounts do not necessarily represent future cash requirements. The allowance for credit losses associated with commitments was ~~$5.8~~$7.3 million and $9.5 million at ~~June~~September 30, 2021 and December 31, 2020, respectively, and is included in other liabilities on the Consolidated Balance Sheets.

Letters of credit are conditional commitments issued by banks to guarantee the performance of a customer to a third party. Those guarantees are primarily issued to support public and private borrowing arrangements, including normal business activities, bond financing and similar transactions. Letters of credit are considered guarantees. The liability associated with letters of credit was $0.1 million and $0.2 million as of ~~June~~September 30, 2021 and December 31, 2020, respectively.

Contingent obligations to purchase loans funded by other entities include ~~affordable housing plan guarantees,~~ credit card guarantees, loans sold with recourse as well as obligations to the FHLB. ~~Affordable housing plan guarantees are performance guarantees for various building project loans. The guarantee amortizes as the loan balances decrease.~~ Credit card guarantees are credit card balances not owned by Wesbanco, whereby the Bank guarantees the performance of the cardholder.

The following table presents total commitments to extend credit, guarantees and various letters of credit outstanding:

	June 30,		December 31,		September 30,		December 31,
(unaudited, in thousands)	2021		2020		2021		2020
Lines of credit	$	2,504,347	$	2,510,011	$	2,801,461	$	2,510,011
Loans approved but not closed		517,071		381,180		449,869		381,180
Overdraft limits		152,302		154,322
Overdraft coverage						381,243		154,322
Letters of credit		50,423		53,788		29,234		53,788
Contingent obligations and other guarantees		176,244		126,984		117,682		126,984

Contingent Liabilities — Wesbanco recognized $2.6 million of legal settlement costs in the third quarter in which settlement is subject to final court approval. Wesbanco is a party to various legal and administrative proceedings and claims. While any litigation contains an element of uncertainty, management does not believe that a material loss related to such proceedings or claims pending or known to be threatened is reasonably possible.

Wesbanco operates 2 reportable segments: community banking and trust and investment services. Wesbanco’s community banking segment offers services traditionally offered by full-service commercial banks, including commercial demand, individual demand and time deposit accounts, as well as commercial, mortgage and individual installment loans, and certain non-traditional offerings, such as insurance and securities brokerage services. The trust and investment services segment offers trust services as well as various alternative investment products including mutual funds. The market value of assets managed or held in custody by the trust and investment services segment was approximately $5.5 billion and ~~$4.5~~$4.6 billion at ~~June~~September 30, 2021 and 2020, respectively. These assets are held by Wesbanco in fiduciary or agency capacities for their customers and therefore are not included as assets on Wesbanco’s Consolidated Balance Sheets.

				Trust and								Trust and
	Community			Investment					Community			Investment
(unaudited, in thousands)	Banking			Services		Consolidated			Banking			Services		Consolidated
For The Three Months Ended June 30, 2021
For The Three Months Ended September 30, 2021
Interest and dividend income	$	123,327		$	—	$	123,327		$	121,378		$	—	$	121,378
Interest expense		7,472			—		7,472			6,103			—		6,103
Net interest income		115,855			—		115,855			115,275			—		115,275
Provision for credit losses		(21,025	)		—		(21,025	)		(1,730	)		—		(1,730	)
Net interest income after provision for credit losses		136,880			—		136,880			117,005			—		117,005
Non-interest income		28,963			7,149		36,112			25,466			7,289		32,755
Non-interest expense		79,818			3,994		83,812			90,599			4,102		94,701
Income before provision for income taxes		86,025			3,155		89,180			51,872			3,187		55,059
Provision for income taxes		17,929			663		18,592			9,982			669		10,651
Net income		68,096			2,492		70,588			41,890			2,518		44,408
Preferred stock dividends		2,531			—		2,531			2,531			—		2,531
Net income available to common shareholders	$	65,565		$	2,492	$	68,057		$	39,359		$	2,518	$	41,877

For The Three Months Ended June 30, 2020
For The Three Months Ended September 30, 2020
Interest and dividend income	$	134,694		$	—	$	134,694		$	133,657		$	—	$	133,657
Interest expense		15,681			—		15,681			13,064			—		13,064
Net interest income		119,013			—		119,013			120,593			—		120,593
Provision for credit losses		61,841			—		61,841			16,288			—		16,288
Net interest income after provision for credit losses		57,172			—		57,172			104,305			—		104,305
Non-interest income		26,659			6,201		32,860			28,186			6,426		34,612
Non-interest expense		81,588			3,914		85,502			86,011			3,932		89,943
Income before provision for income taxes		2,243			2,287		4,530			46,480			2,494		48,974
Provision for income taxes		(438	)		480		42			7,145			524		7,669
Net income available to common shareholders	$	2,681		$	1,807	$	4,488		$	39,335		$	1,970	$	41,305

For the Six Months Ended June 30, 2021
For the Nine Months Ended September 30, 2021
Interest and dividend income	$	248,382		$	—	$	248,382		$	369,760		$	—	$	369,760
Interest expense		16,050			—		16,050			22,153			—		22,153
Net interest income		232,332			—		232,332			347,607			—		347,607
Provision for credit losses		(48,984	)		—		(48,984	)		(50,714	)		—		(50,714	)
Net interest income after provision for credit losses		281,316			—		281,316			398,321			—		398,321
Non-interest income		54,540			14,780		69,320			80,007			22,069		102,076
Non-interest expense		161,829			8,310		170,139			252,428			12,412		264,840
Income before provision for income taxes		174,027			6,470		180,497			225,900			9,657		235,557
Provision for income taxes		35,434			1,359		36,793			45,417			2,028		47,445
Net income		138,593			5,111		143,704			180,483			7,629		188,112
Preferred stock dividends		5,063			—		5,063			7,594			—		7,594
Net income available to common shareholders	$	133,530		$	5,111	$	138,641		$	172,889		$	7,629	$	180,518

For the Six Months Ended June 30, 2020
For the Nine Months Ended September 30, 2020
Interest and dividend income	$	277,142		$	—	$	277,142		$	410,799		$	—	$	410,799
Interest expense		37,968			—		37,968			51,031			—		51,031
Net interest income		239,174			—		239,174			359,768			—		359,768
Provision for credit losses		91,661			—		91,661			107,949			—		107,949
Net interest income after provision for credit losses		147,513			—		147,513			251,819			—		251,819
Non-interest income		47,715			13,154		60,869			75,901			19,580		95,481
Non-interest expense		168,505			8,330		176,835			254,517			12,262		266,779
Income before provision for income taxes		26,723			4,824		31,547			73,203			7,318		80,521
Provision for income taxes		2,650			1,013		3,663			9,795			1,537		11,332
Net income available to common shareholders	$	24,073		$	3,811	$	27,884		$	63,408		$	5,781	$	69,189

Total non-fiduciary assets of the trust and investment services segment were ~~$3.8~~$3.9 million (including ~~$1.6~~$1.5 million of trust customer intangibles) and ~~$4.1~~$4.2 million (including ~~$2.2~~$1.9 million of trust customer intangibles) at ~~June~~September 30, 2021 and 2020, respectively. All other assets, including goodwill and the remainder of other intangible assets, were allocated to the Community Banking segment.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Management’s Discussion and Analysis (“MD&A”) represents an overview of the results of operations and financial condition of Wesbanco for the three and ~~six~~nine months ended ~~June~~September 30, 2021. This discussion and analysis should be read in conjunction with the Consolidated Financial Statements and Notes thereto.

Forward-looking statements in this report relating to Wesbanco’s plans, strategies, objectives, expectations, intentions and adequacy of resources, are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. The information contained in this report should be read in conjunction with Wesbanco’s Form 10-K for the year ended December 31, 2020 and documents subsequently filed by Wesbanco with the Securities and Exchange Commission (“SEC”), including Wesbanco’s Form 10-Q for the ~~quarter~~quarters ended March 31, 2021 and June 30, 2021, which are available at the SEC’s website, www.sec.gov or at Wesbanco’s website, www.Wesbanco.com. Investors are cautioned that forward-looking statements, which are not historical fact, involve risks and uncertainties, including those detailed in Wesbanco’s most recent Annual Report on Form 10-K filed with the SEC under “Risk Factors” in Part I, Item 1A. Such statements are subject to important factors that could cause actual results to differ materially from those contemplated by such statements, including, without limitation, the effects of changing regional and national economic conditions including the effects of the COVID-19 pandemic; changes in interest rates, spreads on earning assets and interest-bearing liabilities, and associated interest rate sensitivity; sources of liquidity available to Wesbanco and its related subsidiary operations; potential future credit losses and the credit risk of commercial, real estate, and consumer loan customers and their borrowing activities; actions of the Federal Reserve Board, the Federal Deposit Insurance Corporation, the SEC, the Financial Institution Regulatory Authority, the Municipal Securities Rulemaking Board, the Securities Investors Protection Corporation, and other regulatory bodies; potential legislative and federal and state regulatory actions and reform, including, without limitation, the impact of the implementation of the Dodd-Frank Act; adverse decisions of federal and state courts; fraud, scams and schemes of third parties; cyber-security breaches; competitive conditions in the financial services industry; rapidly changing technology affecting financial services; marketability of debt instruments and corresponding impact on fair value adjustments; and/or other external developments materially impacting Wesbanco’s operational and financial performance. Wesbanco does not assume any duty to update forward-looking statements.

Wesbanco is a multi-state bank holding company operating through ~~212~~206 branches and ~~206~~203 ATM machines in West Virginia, Ohio, western Pennsylvania, Kentucky, southern Indiana and Maryland, offering retail banking, corporate banking, personal and corporate trust services, brokerage services, mortgage banking and insurance. Wesbanco’s businesses are significantly impacted by economic factors such as market interest rates, federal monetary and regulatory policies, local and regional economic conditions and the competitive environment’s effect upon Wesbanco’s business volumes. Wesbanco’s deposit levels are affected by numerous factors including personal savings rates, personal income, and competitive rates on alternative investments, as well as competition from other financial institutions within the markets we serve and liquidity needs of Wesbanco. Loan levels are also subject to various factors including construction demand, business financing needs, consumer spending and interest rates, as well as loan terms offered by competing lenders.

Wesbanco’s critical accounting policies involving the significant judgments and assumptions used in the preparation of the Consolidated Financial Statements as of ~~June~~September 30, 2021 have remained unchanged from the disclosures presented in Wesbanco’s Annual Report on Form 10-K for the year ended December 31, 2020 within the section “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”

Net income available to common shareholders for the three months ended ~~June~~September 30, 2021 was ~~$68.1~~$41.9 million, with diluted earnings per share of ~~$1.01,~~$0.64, compared to ~~$4.5~~$41.3 million or ~~$0.07~~$0.61 per diluted share, respectively, for the ~~second~~third quarter of 2020. Net income for the ~~six~~nine months ended ~~June~~September 30, 2021, was ~~$138.6~~$180.5 million, with diluted earnings per share of ~~$2.06,~~$2.71, compared to ~~$27.9~~$69.2 million or ~~$0.41~~$1.03 per diluted share, respectively, for the first ~~six~~nine months of 2020. Excluding after-tax restructuring and merger-related expenses (non-GAAP measure) in both periods, for the three months ended ~~June~~September 30, 2021, net income available to common shareholders was ~~$69.0~~$45.4 million or ~~$1.03~~$0.70 per diluted share, as compared to ~~$4.9~~$44.2 million or ~~$0.07~~$0.66 per diluted share, respectively, in the prior year quarter; and net income for the ~~six~~nine months ended ~~June~~September 30, 2021 was ~~$140.3~~$185.7 million or ~~$2.09~~$2.79 per diluted share compared to ~~$32.3~~$76.5 million or ~~$0.48~~$1.14 per diluted share in the prior year period.

	For The Three Months Ended June 30,												For the Six Months Ended June 30,												For the Three Months Ended September 30,												For the Nine Months Ended September 30,
	2021						2020						2021						2020						2021						2020						2021						2020
(unaudited, dollars in thousands, except per share amounts)	Net Income			Diluted Earnings Per Share			Net Income			Diluted Earnings Per Share			Net Income			Diluted Earnings Per Share			Net Income			Diluted Earnings Per Share			Net Income			Diluted Earnings Per Share			Net Income			Diluted Earnings Per Share			Net Income			Diluted Earnings Per Share			Net Income			Diluted Earnings Per Share
Net income available to common shareholders (Non-GAAP)⁽¹⁾	$	69,022		$	1.03		$	4,858		$	0.07		$	140,279		$	2.09		$	32,334		$	0.48		$	45,406		$	0.70		$	44,155		$	0.66		$	185,685		$	2.79		$	76,489		$	1.14
Less: After-tax restructuring and merger-related expenses		(965	)		(0.02	)		(370	)		(0.00	)		(1,638	)		(0.03	)		(4,450	)		(0.07	)		(3,529	)		(0.06	)		(2,850	)		(0.05	)		(5,167	)		(0.08	)		(7,300	)		(0.11	)
Net income available to common shareholders (GAAP)	$	68,057		$	1.01		$	4,488		$	0.07		$	138,641		$	2.06		$	27,884		$	0.41		$	41,877		$	0.64		$	41,305		$	0.61		$	180,518		$	2.71		$	69,189		$	1.03

Net interest income decreased ~~$3.2~~$5.3 million or ~~2.7%~~4.4% in the ~~second~~third quarter of 2021 compared to the same quarter of 2020, reflecting lower loan yields, due to repricing of existing loans and new lower rates offered in the current market environment, lower purchase accounting related accretion and lower rates on investment securities, partially offset by lower interest on deposits and borrowings. As a result of the lower rates and a higher mix of securities versus loans to total assets, the net interest margin decreased by 2023 basis points to ~~3.12%~~3.08% in the ~~second~~third quarter of 2021 as compared to the ~~second~~third quarter of 2020. Over the same time period, the yield on earning assets decreased a total of 4342 basis points and the cost of interest bearing liabilities decreased 3228 basis points. Average loan balances decreased by ~~2.9%~~8.5% from the ~~second~~third quarter of 2020, mainly attributable to forgiveness of SBA Payroll Protection Program (“PPP”) loans and ~~lower residential~~higher levels of commercial real estate ~~and consumer loans,~~loan payoffs, while average securities increased by ~~25.1%~~41.7% over the same time period due to excess liquidity on the balance sheet from stimulus funds received by our customers. Average deposits, excluding certificates of deposit, increased ~~17.2%~~15.3% over the same time period, due mostly to stimulus deposits and increased personal savings. Accretion from acquisitions benefited the ~~second~~third quarter 2021 net interest margin by 1210 basis points, as compared to 1918 basis points in the prior year period. Lastly, the accretion on both existing and ~~the funding of new~~forgiven PPP loans positively impacted the ~~second~~third quarter 2021 net interest margin by a net ~~five~~14 basis points as compared to ~~a negative~~ two basis points for the ~~second~~third quarter of 2020.

Improved macroeconomic forecasts and certain qualitative factors ~~which include lower unemployment projections,~~ utilized in the CECL calculation drove a net benefit of provision for credit losses and resulted in a negative provision of ~~$21.0~~$1.7 million in the ~~second~~third quarter of 2021 as compared to a provision of ~~$61.8~~$16.3 million in the ~~second~~third quarter of 2020. Annualized net charge-offs ~~(recoveries),~~ as a percentage of average portfolio loans, were ~~(0.03)%~~0.03% and ~~0.07%~~0.00% for the ~~second~~third quarter of 2021 and 2020, respectively.

For the ~~second~~third quarter of 2021, non-interest income ~~increased $3.3~~decreased $1.9 million or ~~9.9%~~5.4% compared to the ~~second~~third quarter of 2020, driven primarily by ~~a net gain in other real estate owned and other assets and increases in trust fees, service charges on deposits, electronic banking fees, net securities brokerage revenue and~~lower mortgage banking ~~income. These increases were mitigated somewhat by decreases~~income, which decreased $3.9 million or 46.2% from the record level recorded in ~~net securities gains and other income. The increase~~the prior year amount. While mortgage loan originations remained solid during the quarter, the amount sold in ~~net gain on other real estate owned and other assets~~the secondary market decreased from approximately 75% last year to approximately 40% in the third quarter of ~~$4.1 million was primarily~~2021, due to a ~~gain earned~~continued effort to keep more 1-to-4 family residential mortgages on ~~an investment made by Wesbanco’s Community Development Corporation in a start-up firm more than ten years ago that was recently acquired by a public company.~~the balance sheet. Trust fees increased $0.9 million or ~~15.3%~~13.4% from the third quarter of 2020 to the third quarter of 2021 due to ~~increases in the~~ market ~~value of trust assets to a record level of $5.5 billion at June 30, 2021. Service charges on deposits~~improvements and ~~electronic~~net organic growth. Electronic banking fees increased 12.8% and 24.4%, respectively, due to an increased amount of transaction volume over the second quarter of 2020, which was heavily affected by the onset of the pandemic. Net securities gains decreased $0.8$0.6 million or ~~63.3% due to reduced sale and call activity in the investment portfolio~~13.5% from ~~the prior~~last year’s ~~second~~third quarter as ~~well as reduced market value adjustments on the deferred compensation plan underlying investments.~~we transitioned to adjusted settlement processes of a new third-party digital banking service provider. Other income decreased ~~$3.2~~$1.0 million or ~~50.2% primarily~~19.4% due to ~~a $2.5 million decrease in swap fee~~lower loan swap-related income ~~resulting from lower swap activity~~ and ~~negative fair value adjustments on~~ the ~~existing loan swap portfolio in~~sale of the ~~second quarter of 2021 compared to the second quarter of 2020.~~debit card sponsorship business earlier this year.

Non-interest expense, excluding restructuring and merger-related expenses in both periods, ~~decreased~~increased in the ~~second~~third quarter of 2021 by ~~$2.4~~$3.9 million or ~~2.9%~~4.5%, to ~~$82.6~~$90.2 million, compared to the ~~second~~third quarter of 2020. This year-over-year ~~decrease~~increase is primarily due to ~~lower~~$2.6 million of settlement costs from the pending resolution of a lawsuit, which are located within other operating expenses, and higher salaries expense. Salaries and wages increased $1.2 million or 3.0% from the third quarter of 2020 to the third quarter of 2021 due to higher incentive compensation expense of $1.8 million, reflecting increased business growth and financial performance as compared to the pandemic-impacted prior year. Equipment and software expense for the third quarter of 2021 increased $1.4 million or 22.2% year-over-year, due to increased asset size, increased usage of digital banking services and SBA PPP loan forgiveness. Offsetting these increases somewhat was a decrease in FDIC insurance expense ~~and lower franchise tax expense, as well as continuing cost control measures over certain discretionary expenses. FDIC insurance expense decreased $2.2~~of $0.7 million or ~~92.4%, from the second quarter of 2020,~~37.0% due to ~~certain prior period call report adjustments resulting in a $1.0 million refund, and~~ improved risk ~~factors. Offsetting these decreases somewhat was an increase in equipment expense of $1.6 million or 27.2% from~~factors reducing the ~~second quarter of 2020 due to higher software costs.~~assessment rate.

During the ~~second~~third quarter of 2021, the effective tax rate was ~~20.9%~~19.3% as compared to ~~0.9%~~15.7% in last year’s ~~second~~third quarter, and the provision for income taxes increased by ~~$18.6~~$3.0 million over the same time period, primarily due to higher pre-tax income heavily influenced by the negative provision for credit losses in the ~~second~~third quarter of 2021 as compared to the prior year’s reduced pre-tax income from a pandemic-induced higher provision for credit losses.

	For the Three Months Ended June 30,						For the Six Months Ended June 30,						For the Three Months Ended September 30,						For the Nine Months Ended September 30,
(unaudited, dollars in thousands)	2021			2020			2021			2020			2021			2020			2021			2020
Net interest income	$	115,855		$	119,013		$	232,332		$	239,174		$	115,275		$	120,593		$	347,607		$	359,768
Taxable equivalent adjustment to net interest income		1,051			1,143			2,091			2,328			1,080			1,112			3,170			3,440
Net interest income, fully taxable equivalent	$	116,906		$	120,156		$	234,423		$	241,502		$	116,355		$	121,705		$	350,777		$	363,208
Net interest spread, non-taxable equivalent		2.98	%		3.09	%		3.04	%		3.16	%		2.96	%		3.10	%		3.02	%		3.14	%
Benefit of net non-interest bearing liabilities		0.11	%		0.20	%		0.12	%		0.23	%		0.09	%		0.18	%		0.11	%		0.21	%
Net interest margin		3.09	%		3.29	%		3.16	%		3.39	%		3.05	%		3.28	%		3.13	%		3.35	%
Taxable equivalent adjustment		0.03	%		0.03	%		0.03	%		0.03	%		0.03	%		0.03	%		0.03	%		0.03	%
Net interest margin, fully taxable equivalent		3.12	%		3.32	%		3.19	%		3.42	%		3.08	%		3.31	%		3.16	%		3.38	%

Net interest income, which is Wesbanco’s largest source of revenue, is the difference between interest income on earning assets, primarily loans and securities, and interest expense on liabilities, primarily deposits and short and long-term borrowings. Net interest income is affected by the general level of, and changes in interest rates, the steepness and shape of the yield curve, changes in the amount and composition of interest earning assets and interest bearing liabilities, as well as the frequency of repricing of existing assets and liabilities. Net interest income decreased ~~$3.2~~$5.3 million or ~~2.7%~~4.4% in the ~~second~~third quarter of 2021 compared to the ~~second~~third quarter of 2020, due to a 2023 basis point decrease in the net interest margin to ~~3.12%~~3.08% resulting from the lower yield environment, as the yield on earning assets decreased at a faster rate than the rate on interest bearing liabilities. For the ~~six~~nine months ended ~~June~~September 30, 2021, net interest income decreased by ~~$6.8~~$12.2 million or ~~2.9%~~3.4% compared to the first ~~six~~nine months of 2020 for ~~the same~~similar reasons. The net interest margin decrease was slightly mitigated by a ~~3.0%~~2.3% increase in average earning asset balances from the ~~second~~third quarter of 2020, primarily from a ~~25.1%~~41.7% increase in average securities, which were purchased with liquidity from stimulus-related deposits. Also helping to mitigate the margin decrease, ~~further,~~ PPP loans contributed a total of ~~$7.8~~$8.2 million in interest and fee accretion income in the ~~second~~third quarter of 2021. ~~The forgiveness of existing~~This PPP ~~loans and the funding of new PPP loans~~loan income positively impacted the ~~second~~third quarter 2021 net interest margin by a net 514 basis points. Excluding PPP loans, portfolio loans decreased by ~~4.1%~~4.9% from ~~June~~September 30, 2020, due to lower new loan demand ~~other than residential lending, most~~and high levels of ~~which was sold in the secondary market.~~commercial real estate loan payoffs. In addition, purchase accounting accretion decreased in the ~~second~~third quarter of 2021, as approximately 1210 basis points of accretion from prior acquisitions was included in the ~~second~~third quarter 2021 net interest margin as compared to 1918 basis points in the 2020 ~~second~~third quarter net interest margin. Total average deposits, excluding CDs, increased in the ~~second~~third quarter of 2021 by ~~$1.7~~$1.6 billion or ~~17.2%~~15.3% compared to the ~~second~~third quarter of 2020, due to stimulus deposits ~~PPP loan proceeds deposited into customer accounts,~~and higher personal savings ~~balances and lower general consumer spending.~~balances. The cost of interest bearing deposits decreased by 1312 basis points and total liabilities decreased by 3228 basis points from the ~~second~~third quarter of 2020 to the ~~second~~third quarter of 2021. The decrease in the cost is primarily due to aggressive rate decreases for interest bearing demand deposits, which include public funds, and lower rates for certificates of deposit, customer repurchase agreements, ~~short to medium-term~~term Federal Home Loan Bank borrowings and junior subordinated debentures, in response to the general decrease in overall borrowing rates in the marketplace resulting from lower rates across the yield curve. In addition, the average balance of FHLB borrowings decreased by ~~$1.0 billion~~$717.3 million or ~~71.8%~~71.3% from the ~~second~~third quarter of 2020, as excess liquidity was used to pay off these borrowings as they matured.

Interest income decreased ~~$11.4~~$12.3 million or ~~8.4%~~9.2% in the ~~second~~third quarter of 2021 and ~~$28.8~~$41.0 million or ~~10.4%~~10.0% in the first ~~six~~nine months of 2021 compared to the same periods of 2020 due to lower yields in every major earning asset category. Earning asset yields were influenced negatively in the ~~second~~third quarter of 2021 compared to the ~~second~~third quarter of 2020 due primarily to decreases in the Federal Reserve’s federal funds rate by 150 basis points in 2020 and the continuation of the low rate environment through the current period. Average loan balances decreased ~~$313.7~~$942.8 million or ~~2.9%~~8.5% in the ~~second~~third quarter of 2021 compared to the ~~second~~third quarter of 2020, due mostly to forgiveness of PPP loans that were originated in ~~2020.~~2020 and the first half of 2021. Loan yields decreased by 2314 basis points during this same period to ~~3.99% from~~4.03% due to the previously mentioned lower rate environment and its effect on the repricing of portfolio loans, as well as lower offered rates on new loans. Loans provide the greatest impact on interest income and the yield on earning assets as they have the largest balance and the highest yield within major earning asset categories. In the ~~second~~third quarter of 2021, average loans represented ~~70.9%~~67.8% of average earning assets, a decrease from ~~75.2%~~75.8% in the ~~second~~third quarter of 2020. As liquidity from stimulus deposits was invested, average taxable securities balances increased ~~$753.6 million~~$1.1 billion or ~~32.9%~~51.3% from the ~~second~~third quarter of 2020, and represented ~~20.3%~~21.4% of total earning assets in the ~~second~~third quarter of 2021. Taxable securities yields decreased by 7752 basis points and tax-exempt securities yields decreased by 1835 basis points in the ~~second~~third quarter of 2021 from the ~~second~~third quarter of 2020. The continuing lower rate environment has resulted in the yield decrease for all securities, as calls, prepayments and maturities of legacy higher-rate securities have been replaced with purchases at lower overall market yields. Increased prepayments on mortgage-backed securities in the lower rate environment also further reduced the taxable securities yields due to higher premium amortization. The average balance of tax-exempt securities, which have the highest yields within securities, have decreased from ~~21.4%~~22.2% of total average securities in the ~~second~~third quarter of 2020 to ~~16.5%~~16.8% of total average securities in the ~~second~~third quarter of 2021.

Commercial loans with floors currently average ~~4.04%~~3.93% on approximately ~~$2.5~~$2.6 billion or ~~32%~~35% of total commercial loans at ~~June~~September 30, 2021, as compared to $2.3 billion averaging 4.22% or 29% of commercial loans at December 31, 2020. Approximately 65% or ~~$1.6~~$1.7 billion of these loans are currently priced at their floor, as compared to 69% or $1.6 billion at December 31, 2020. These loans typically do not adjust as rapidly from their current floor level as compared to loans without floors, due to the amount of the rate change as compared to the floor rate or next repricing date. In addition, in a declining rate environment, ~~some~~ customers may request rates below existing contractual floors, which we may grant for competitive or other reasons.

Interest expense decreased ~~$8.2~~$7.0 million or ~~52.3%~~53.3% in the ~~second~~third quarter of 2021 and ~~$21.9~~$28.9 million or ~~57.7%~~56.6% in the first ~~six~~nine months of 2021 as compared to the same periods in 2020, due to decreases in the cost of all interest bearing liability categories, as management reduced certain deposit rates, and due to a decrease in the balance of outstanding FHLB borrowings. The cost of interest bearing liabilities decreased by 3228 basis points from the ~~second~~third quarter of 2020 to ~~0.31%~~0.25% in 2021. Interest bearing deposits increased ~~$787.4~~$784.5 million or ~~9.8%~~9.6% from the ~~second~~third quarter of 2020, due mostly to customers’ stimulus payments. The rate on interest bearing deposits decreased 1312 basis points to ~~17 basis points~~0.14% from the ~~second~~third quarter of 2020, primarily from aggressive decreases in rates on interest bearing public funds and certificates of deposit in response to the lower market ~~rates.~~rates, which are currently near their floors. Average non-interest bearing demand deposit balances increased from the ~~second~~third quarter of 2020 to the ~~second~~third quarter of 2021 by ~~$618.5~~$462.7 million or ~~16.0%~~11.4%, and were ~~33.6%~~33.4% of total average deposits at ~~June~~September 30, 2021, compared to ~~32.3%~~33.1% at ~~June~~September 30, 2020, reflecting the previously mentioned stimulus ~~deposits, PPP loan~~ deposits, higher personal savings balances and ongoing checking account marketing strategies. The average balance of FHLB borrowings decreased ~~$1.0 billion~~$717.3 million from the ~~second~~third quarter of 2020 to 2021 due to the maturity of legacy higher-rate FHLB borrowings throughout the past twelve months being redeemed with excess liquidity. These maturities benefited the average rate paid, as it decreased by 2953 basis points to ~~1.83%~~1.63% from the ~~second~~third quarter of 2020. Average other borrowings combined with subordinated debt and junior subordinated debt balances decreased ~~$235.2~~$251.6 million or ~~42.2%~~43.7% from the ~~second~~third quarter of 2020 to 2021, and their average rates paid decreased by 1922 and 5720 basis points, respectively, over this same time period, due primarily to decreases in LIBOR, the index upon which this variable-rate type of borrowing is ~~priced, other than fixed rates on $35.1 million of subordinated debt.~~priced.

The continuing low rate environment is expected to result in the core net interest margin declining ~~several~~a few basis points over the ~~remainder of the year,~~fourth quarter, as securities purchased toward the end of the ~~second~~third quarter will further negatively impact the margin. Lower anticipated earning asset yields caused by loans repricing to lower rates, rates on new loan production being lower than existing loans, security cash flows being reinvested at lower rates and decreasing purchase accounting accretion should be slightly mitigated by price reductions to deposit rates and lower wholesale funding costs. The subordinated debt payoff late in the third quarter of 2021 and the upcoming subordinated debt payoff in November, both of which were acquired in previous acquisitions, will further help to reduce the cost of interest-bearing liabilities. In addition, Wesbanco’s participation in the PPP loan program is expected to positively contribute to net interest income and further mitigate the decreases toin the net interest margin ~~in 2021~~ as SBA loan forgiveness occurs for qualifying customers and net deferred fees are accreted into income at the date of loan payoff. At ~~June~~September 30, 2021, there ~~are $17.6~~were $10.4 million of remaining net deferred fees from PPP loans that will accrete into interest income as loans pay down or are forgiven by the SBA.

	For The Three Months Ended June 30,										For the Six Months Ended June 30,										For The Three Months Ended September 30,										For the Nine Months Ended September 30,
	2021					2020					2021					2020					2021					2020					2021					2020
	Average		Average			Average		Average			Average		Average			Average		Average			Average		Average			Average		Average			Average		Average			Average		Average
(unaudited, dollars in thousands)	Balance		Rate			Balance		Rate			Balance		Rate			Balance		Rate			Balance		Rate			Balance		Rate			Balance		Rate			Balance		Rate
ASSETS
Due from banks - interest bearing	$	696,967		0.09	%	$	637,979		0.17	%	$	736,387		0.09	%	$	385,755		0.35	%	$	936,084		0.16	%	$	755,575		0.16	%	$	803,713		0.12	%	$	509,928		0.25	%
Loans, net of unearned income⁽¹⁾		10,641,970		3.99	%		10,955,694		4.22	%		10,765,483		4.03	%		10,665,441		4.42	%		10,164,279		4.03	%		11,107,106		4.17	%		10,562,879		4.03	%		10,813,737		4.34	%
Securities:⁽²⁾
Taxable		3,042,009		1.70	%		2,288,409		2.47	%		2,676,198		1.81	%		2,432,539		2.57	%		3,210,878		1.67	%		2,121,780		2.19	%		2,856,041		1.75	%		2,328,196		2.45	%
Tax-exempt ⁽³⁾		599,980		3.34	%		622,637		3.52	%		590,144		3.40	%		634,612		3.51	%		650,397		3.14	%		603,835		3.49	%		610,449		3.31	%		624,278		3.50	%
Total securities		3,641,989		1.97	%		2,911,046		2.69	%		3,266,342		2.10	%		3,067,151		2.76	%		3,861,275		1.91	%		2,725,615		2.47	%		3,466,490		2.03	%		2,952,474		2.67	%
Other earning assets		28,702		4.95	%		71,493		5.68	%		30,958		5.45	%		70,537		6.02	%		23,646		4.23	%		56,575		6.88	%		28,494		5.11	%		65,849		6.27	%
Total earning assets ⁽³⁾		15,009,628		3.32	%		14,576,212		3.75	%		14,799,170		3.41	%		14,188,884		3.96	%		14,985,284		3.24	%		14,644,871		3.66	%		14,861,576		3.36	%		14,341,988		3.86	%
Other assets		2,032,519					2,138,999					2,041,154					2,061,191					2,072,509					2,074,846					2,060,312					2,065,777
Total Assets	$	17,042,147				$	16,715,211				$	16,840,324				$	16,250,075				$	17,057,793				$	16,719,717				$	16,921,888				$	16,407,765

LIABILITIES AND SHAREHOLDERS' EQUITY
Interest bearing demand deposits	$	3,147,915		0.13	%	$	2,558,768		0.21	%	$	3,059,830		0.14	%	$	2,450,605		0.39	%	$	3,297,702		0.10	%	$	2,654,161		0.18	%	$	3,139,992		0.12	%	$	2,518,952		0.32	%
Money market accounts		1,774,556		0.12	%		1,603,395		0.22	%		1,750,194		0.13	%		1,573,579		0.41	%		1,791,494		0.08	%		1,623,969		0.17	%		1,764,462		0.11	%		1,590,498		0.33	%
Savings deposits		2,414,824		0.04	%		2,060,392		0.06	%		2,353,083		0.04	%		2,006,940		0.12	%		2,471,593		0.04	%		2,140,932		0.06	%		2,393,066		0.04	%		2,051,930		0.10	%
Certificates of deposit		1,519,590		0.53	%		1,846,929		0.77	%		1,551,692		0.57	%		1,918,189		0.79	%		1,403,812		0.49	%		1,761,087		0.72	%		1,501,857		0.54	%		1,865,439		0.77	%
Total interest bearing deposits		8,856,885		0.17	%		8,069,484		0.30	%		8,714,799		0.19	%		7,949,313		0.42	%		8,964,601		0.14	%		8,180,149		0.26	%		8,799,377		0.17	%		8,026,819		0.37	%
Federal Home Loan Bank borrowings		390,020		1.83	%		1,381,093		2.12	%		438,932		1.93	%		1,426,134		2.19	%		289,334		1.63	%		1,006,593		2.16	%		388,518		1.85	%		1,285,266		2.18	%
Other borrowings		130,171		0.12	%		365,793		0.31	%		160,753		0.20	%		350,917		0.66	%		136,028		0.10	%		383,771		0.32	%		152,450		0.17	%		361,949		0.54	%
Subordinated debt and junior subordinated debt		192,483		3.76	%		192,021		4.33	%		192,412		3.77	%		195,257		4.67	%		188,276		3.67	%		192,093		3.87	%		191,018		3.73	%		194,195		4.40	%
Total interest bearing liabilities ⁽⁴⁾		9,569,559		0.31	%		10,008,391		0.63	%		9,506,896		0.34	%		9,921,621		0.77	%		9,578,239		0.25	%		9,762,606		0.53	%		9,531,363		0.31	%		9,868,229		0.69	%
Non-interest bearing demand deposits		4,474,784					3,856,291					4,338,546					3,496,784					4,504,332					4,041,681					4,402,487					3,679,743
Other liabilities		196,349					247,591					208,861					233,166					197,916					252,917					205,309					239,797
Shareholders’ equity		2,801,455					2,602,938					2,786,021					2,598,504					2,777,306					2,662,513					2,782,729					2,619,996
Total Liabilities and Shareholders’ Equity	$	17,042,147				$	16,715,211				$	16,840,324				$	16,250,075				$	17,057,793				$	16,719,717				$	16,921,888				$	16,407,765
Taxable equivalent net interest spread				3.01	%				3.12	%				3.07	%				3.19	%				2.99	%				3.13	%				3.05	%				3.17	%
Taxable equivalent net interest margin				3.12	%				3.32	%				3.19	%				3.42	%				3.08	%				3.31	%				3.16	%				3.38	%

TABLE 3. RATE/VOLUME ANALYSIS OF CHANGES IN INTEREST INCOME AND INTEREST EXPENSE

	For the Three Months Ended June 30, 2021									For the Six Months Ended June 30, 2021									For the Three Months Ended September 30, 2021									For the Nine Months Ended September 30, 2021
	Compared to June 30, 2020									Compared to June 30, 2020									Compared to September 30, 2020									Compared to September 30, 2020
(unaudited, in thousands)	Volume			Rate			Net Increase (Decrease)			Volume			Rate			Net Increase (Decrease)			Volume			Rate			Net Increase (Decrease)			Volume			Rate			Net Increase (Decrease)
Increase (decrease) in interest income:
Due from banks - interest bearing	$	23		$	(138	)	$	(115	)	$	360		$	(700	)	$	(340	)	$	73		$	-		$	73		$	408		$	(635	)	$	(227	)
Loans, net of unearned income		(3,234	)		(5,865	)		(9,099	)		2,303			(21,547	)		(19,244	)		(9,660	)		(3,658	)		(13,318	)		(8,002	)		(24,561	)		(32,563	)
Taxable securities		3,888			(5,036	)		(1,148	)		2,876			(9,882	)		(7,006	)		5,020			(3,208	)		1,812			8,459			(13,694	)		(5,235	)
Tax-exempt securities ⁽¹⁾		(194	)		(249	)		(443	)		(759	)		(375	)		(1,134	)		391			(542	)		(151	)		(357	)		(928	)		(1,285	)
Other earning assets		(541	)		(117	)		(658	)		(1,087	)		(187	)		(1,274	)		(438	)		(289	)		(727	)		(1,507	)		(492	)		(1,999	)
Total interest income change ⁽¹⁾		(58	)		(11,405	)		(11,463	)		3,693			(32,691	)		(28,998	)		(4,614	)		(7,697	)		(12,311	)		(999	)		(40,310	)		(41,309	)
Increase (decrease) in interest expense:
Interest bearing demand deposits		266			(607	)		(341	)		967			(3,660	)		(2,693	)		250			(660	)		(410	)		1,213			(4,324	)		(3,111	)
Money market accounts		86			(414	)		(328	)		328			(2,429	)		(2,101	)		67			(424	)		(357	)		390			(2,839	)		(2,449	)
Savings deposits		46			(82	)		(36	)		182			(877	)		(695	)		42			(101	)		(59	)		221			(975	)		(754	)
Certificates of deposit		(553	)		(935	)		(1,488	)		(1,281	)		(1,891	)		(3,172	)		(568	)		(903	)		(1,471	)		(1,852	)		(2,791	)		(4,643	)
Federal Home Loan Bank borrowings		(4,638	)		(874	)		(5,512	)		(9,632	)		(1,698	)		(11,330	)		(3,190	)		(1,075	)		(4,265	)		(12,826	)		(2,769	)		(15,595	)
Other borrowings		(124	)		(115	)		(239	)		(433	)		(557	)		(990	)		(130	)		(141	)		(271	)		(577	)		(685	)		(1,262	)
Subordinated debt and junior subordinated debt		5			(270	)		(265	)		(65	)		(872	)		(937	)		(37	)		(91	)		(128	)		(103	)		(961	)		(1,064	)
Total interest expense change		(4,912	)		(3,297	)		(8,209	)		(9,934	)		(11,984	)		(21,918	)		(3,566	)		(3,395	)		(6,961	)		(13,534	)		(15,344	)		(28,878	)
Net interest income increase (decrease) ⁽¹⁾	$	4,854		$	(8,108	)	$	(3,254	)	$	13,627		$	(20,707	)	$	(7,080	)
Net interest income (decrease) increase ⁽¹⁾																			$	(1,048	)	$	(4,302	)	$	(5,350	)	$	12,535		$	(24,966	)	$	(12,431	)

The provision for credit losses – loans is the amount to be added to the allowance for credit losses – loans after net (charge-offs) recoveries have been (deducted) added to bring the allowance to a level considered appropriate to absorb lifetime expected losses for all portfolio loans. The provision for credit losses – loan commitments is the amount to be added to the allowance for credit losses for loan commitments to bring that allowance to a level considered appropriate to absorb lifetime expected losses on unfunded loan commitments. The provision for credit losses - loans and loan commitments decreased to ($~~21.0)~~1.7) million in the ~~second~~third quarter of 2021 compared to ~~$61.3~~$16.3 million ~~of provision expense~~ in the ~~second~~third quarter of 2020, as a result of changes in the macroeconomic forecast ~~the economic environment~~ and certain other qualitative factors. As of ~~June~~September 30, 2021, the macroeconomic forecast estimated significantly lower unemployment over the reasonable and supportable forecast period of oneyear, as compared to the forecast utilized during the ~~second~~third quarter of 2020, resulting in a decrease in the allowance for loan losses and allowance for loan commitments. Non-performing loans were ~~0.41%~~0.40% of total loans as of ~~June~~September 30, 2021, increasing from ~~0.37%~~0.38% of total loans at the end of the ~~second~~third quarter of 2020. Criticized and classified loans were ~~4.41%~~4.21% of total loans as of ~~June~~September 30, 2021, increasing from ~~2.23%~~3.25% as of ~~June~~September 30, 2020, primarily due to recent adjustments to the internal loan classification system, which impacted risk grades, and downgrades in the Company’s hospitality loan portfolio. Past due loans at ~~June~~September 30, 2021 were ~~0.29%~~0.44% of total loans, compared to ~~0.61%~~0.25% at ~~June~~September 30, 2020. Annualized net loan charge-offs ~~(recoveries) decreased~~increased to ~~(0.03)% as of June~~0.01% for the nine months ended September 30, 2021 compared to ~~0.07% as of June~~0.08% for the nine months ended September 30, 2020. (Please see the Allowance for Credit Losses – Loans and Loan Commitments section of this MD&A for additional discussion).

	For The Three Months Ended June 30,												For the Six Months Ended June 30,										For The Three Months Ended September 30,												For the Nine Months Ended September 30,
(unaudited, dollars in thousands)	2021			2020			$ Change			% Change			2021		2020		$ Change			% Change			2021			2020			$ Change			% Change			2021		2020		$ Change			% Change
Trust fees	$	7,148		$	6,202		$	946			15.3		$	14,780	$	13,154	$	1,626			12.4		$	7,289		$	6,426		$	863			13.4		$	22,069	$	19,580	$	2,489			12.7
Service charges on deposits		4,876			4,323			553			12.8			9,770		10,940		(1,170	)		(10.7	)		6,050			5,332			718			13.5			15,820		16,272		(452	)		(2.8	)
Electronic banking fees		5,060			4,066			994			24.4			9,426		8,320		1,106			13.3			5,427			4,780			647			13.5			14,853		13,100		1,753			13.4
Net securities brokerage revenue		1,829			1,384			445			32.2			3,352		3,063		289			9.4			1,965			1,725			240			13.9			5,318		4,787		531			11.1
Bank-owned life insurance		1,707			1,752			(45	)		(2.6	)		3,416		3,521		(105	)		(3.0	)		2,656			2,088			568			27.2			6,072		5,609		463			8.3
Net securities gains		477			1,299			(822	)		(63.3	)		756		2,790		(2,034	)		(72.9	)
Net securities (losses) gains																								(15	)		787			(802	)		(101.9	)		740		3,577		(2,837	)		(79.3	)
Mortgage banking income		7,830			7,531			299			4.0			12,094		8,807		3,287			37.3			4,563			8,488			(3,925	)		(46.2	)		16,656		17,295		(639	)		(3.7	)
Net insurance services revenue		1,045			936			109			11.6			2,135		1,781		354			19.9			909			1,026			(117	)		(11.4	)		3,044		2,807		237			8.4
Debit card sponsorship income		—			644			(644	)		(100.0	)		646		1,351		(705	)		(52.2	)		—			751			(751	)		(100.0	)		646		2,102		(1,456	)		(69.3	)
Payment processing fees		748			784			(36	)		(4.6	)		1,461		1,464		(3	)		(0.2	)		773			669			104			15.5			2,234		2,133		101			4.7
Net gain (loss) on other real estate owned and other assets		4,014			(66	)		4,080		NM				4,189		103		4,086		NM				785			(19	)		804		NM				4,974		84		4,890		NM
Net swap fee and valuation income		(40	)		2,949			(2,989	)		(101.4	)		4,610		2,847		1,763			61.9			776			1,286			(510	)		(39.7	)		5,386		4,134		1,252			30.3
Other		1,418			1,056			362			34.3			2,685		2,728		(43	)		(1.6	)		1,577			1,273			304			23.9			4,264		4,001		263			6.6
Total non-interest income	$	36,112		$	32,860		$	3,252			9.9		$	69,320	$	60,869	$	8,451			13.9		$	32,755		$	34,612		$	(1,857	)		(5.4	)	$	102,076	$	95,481	$	6,595			6.9

Non-interest income is a significant source of revenue and an important part of Wesbanco’s results of operations, as it represents ~~23.0%~~22.7% of total revenue for the ~~six~~nine months ended ~~June~~September 30, 2021. Wesbanco offers its customers a wide range of retail, commercial, investment and electronic banking services, which are viewed as a vital component of Wesbanco’s ability to attract and maintain customers, as well as providing additional fee income beyond normal spread-related income to Wesbanco. For the ~~second~~third quarter of 2021, non-interest income ~~increased $3.3~~decreased $1.9 million or ~~9.9%~~5.4% compared to the ~~second~~third quarter of 2020, primarily due to a ~~$4.1~~$3.9 million decrease in mortgage banking income, a $0.8 million decrease in net securities (losses) gains and a $0.8 million decrease in debit card sponsorship income, due to the sale of the business line earlier in 2021. The decreases were somewhat offset by a $0.9 million increase in trust fees, a $0.8 million increase in net gain (loss) on other real estate owned and other assets and a ~~$1.0~~$0.7 million increase in electronic banking fees and a $0.9 million increase in trust fees. The increases were somewhat offset by a $3.0 million decrease in swap fee and valuation income, and a $0.8 million or 63.3% decrease in net securities gains from the second quarter of 2020.service charges on deposits.

Trust fees increased $0.9 million or ~~15.3%~~13.4% compared to the ~~second~~third quarter of 2020, due to market value appreciation and organic growth. Total trust assets were $5.5 billion at ~~June~~September 30, 2021 as compared to ~~$4.5~~$4.6 billion at ~~June~~September 30, 2020. As of ~~June~~September 30, 2021, trust assets include managed assets of $4.4 billion and non-managed (custodial) assets of $1.1 billion. Assets managed for the WesMark Funds, a proprietary group of mutual funds that is advised by Wesbanco Trust and Investment Services, were ~~$1.1~~$1.0 billion as of ~~June~~September 30, 2021 and ~~$903.0~~$943.6 million as of ~~June~~September 30, 2020, and are included in managed assets.

Service charges on deposits increased ~~$0.6~~$0.7 million or ~~12.8%~~13.5% to ~~$4.9~~$6.1 million in the ~~second~~third quarter of 2021 as compared to the same period in 2020 due to increased general consumer spending over the prior period, resulting in more eligible fee-generating transactions. For the ~~six~~nine months ended ~~June~~September 30, 2021, service charges on deposits decreased ~~$1.2~~$0.5 million or ~~10.7%~~2.8% compared to the ~~six~~nine months ended ~~June~~September 30, ~~2020.~~2020 due to higher customer demand for goods and services as business conditions improved from the pandemic.

Electronic banking fees, which include debit card interchange fees, increased ~~$1.0~~$0.6 million or ~~24.4%~~13.5% compared to the ~~second~~third quarter of ~~2020.~~2020 as we transitioned to adjusted settlement processes of a new third-party digital banking service provider. This ~~growth is due primarily to increased point-of-sale transactions and ATM volumes.~~change occurred as part of the core conversion. For the ~~six~~nine months ended ~~June~~September 30, 2021, electronic banking fees increased ~~$1.1~~$1.8 million or ~~13.3%~~13.4% compared to the ~~six~~nine months ended ~~June~~September 30, 2020.

Bank-owned life insurance increased $0.6 million or 27.2% compared to the third quarter of 2020 due to an increase in mortality-related benefits received in the current period as well as an increase in the cash surrender value, due to the purchase of an additional $40 million of bank-owned life insurance in the third quarter of 2021.

Net securities (losses) gains include both gains and losses on investment security transactions as well as market value adjustments on the deferred compensation plan. For the three months ended September 30, 2021, net securities (losses) gains decreased $0.8 million or ~~63.3% in the second quarter of 2021~~101.9% compared to the same period of 2020, ~~as no securities were sold~~due to a $0.7 million decrease in ~~the second quarter of 2021. Included in net securities gains were $0.4 million and $1.0 million of~~ market adjustments on the deferred compensation ~~plan for the three months ended June 30, 2021 and 2020, respectively, which~~plan. These market adjustments had an offsetting effect in employee benefits expense. For the ~~six~~nine months ended ~~June~~September 30, 2021, net securities (losses) gains decreased ~~$2.0~~$2.8 million or ~~72.9%~~79.3% compared to the ~~six~~nine months ended ~~June~~September 30, 2020, due primarily to no security sales being transacted during the year 2021. Gains on security sales totaled $2.1 million for the nine months ended September 30, 2020.

Mortgage banking income ~~increased $0.3~~decreased $3.9 million or ~~4.0%~~46.2% in the ~~second~~third quarter of 2021 compared to the ~~second~~third quarter of ~~2020.~~2020, as Wesbanco retained more 1-to-4 family mortgages on the balance sheet. For the ~~second~~third quarter of 2021, mortgage production was ~~$342.3~~$382.4 million, which was a decrease of ~~6.3%~~2.9% from the comparable 2020 period. For the three months ended ~~June~~September 30, 2021, ~~$266.8~~$149.6 million in mortgages were sold into the secondary market at a net margin of ~~2.9%~~3.1% as compared to ~~$268.9~~$217.6 million at a net margin of ~~2.8%~~3.9% in the comparable 2020 period. Included in mortgage banking income and the calculation of net margin noted above are losses of ($0.2) million and gains of ~~$2.3 million and $0.6~~$1.5 million from the fair value adjustments on mortgage loan commitments and related derivatives for the three months ended ~~June~~September 30, 2021 and 2020, respectively. InFor the ~~six~~nine months ended ~~June~~September 30, 2021, ~~the continued low interest rate environment resulted in an increase in~~ mortgage banking income ~~of $3.3~~decreased by $0.6 million or ~~37.3%,~~3.7% compared to the prior year period, ~~net of~~due primarily to fair value ~~adjustments. The change was due to~~adjustments of ($4.4) million and $2.2 million for the nine months ended September 30, 2021 and 2020, respectively, offsetting a ~~higher six month production~~$144.5 million volume ~~of $659.6 million~~increase in ~~the first half of 2021 as compared to $581.0 million in the first half of 2020, and a greater portion of mortgages~~loans sold ~~into the secondary market of 73.2% compared to 45.9% sold in~~from the prior ~~year.~~year period.

Debit card sponsorship income, a non-essential revenue stream for Wesbanco that was acquired in the Old Line Bancshares, Inc. (“OLBK”) acquisition and generated $0.6 million of gross revenue in the first quarter of 2021, was sold as of March 31, 2021 to another bank. The all-cash purchase price, which will be paid out on a monthly basis over a two-year period up to a maximum of $2.8 million, is based on a 50%-50% split of the monthly gross revenue earned by the purchasing bank. Wesbanco has recognized $0.8 million in revenue in 2021 following the sale, which is recorded in net gain (loss) on the sale of other real estate owned and other assets.

Net gain (loss) on other real estate owned and other assets increased ~~$4.1~~$0.8 million in the three months ended ~~June~~September 30, 2021 as compared to the same period in 2020, due to a gain recognized on an investment made by Wesbanco’s Community Development Corporation in a start-up firm more than ten years ago that was recently acquired by a public company. Net gain (loss) on other real estate owned and other assets increased by $4.9 million in the nine months ended September 30, 2021 for the same reason as discussed for the three months ended.

Net swap fee and valuation income, which includes fair value adjustments, decreased ~~$3.0~~$0.5 million or 39.7% in the ~~second~~third quarter of 2021 compared to the ~~second~~third quarter of 2020 due to a reduced volume of new swaps originated, resulting in less fee ~~income, as well as a reduction in fair value adjustments on swaps in the second quarter of 2021.~~income. For the three months ended ~~June~~September 30, 2021, new swaps executed totaled ~~$41.5~~$9.3 million in notional principal resulting in $0.4 million of fee income, compared to new swaps executed of $25.8 million in notional principal resulting in $0.9 million of fee income ~~compared to new swaps executed of $131.4 million in notional principal resulting in $3.5 million of fee income~~ for the three months ended ~~June~~September 30, 2020. Fair value adjustments on existing swaps for the three months ended ~~June~~September 30, 2021 and 2020 were ~~($1.0) million and ($0.5) million, respectively.~~$0.4 million. Net swap fee and valuation income increased ~~$1.8~~$1.3 million or ~~61.9%~~30.3% in the first ~~six~~nine months of 2021 compared to the first ~~six~~nine months of 2020 due to higher fair value adjustments offsetting a reduced volume of new swaps in the year-to-date period. Fair value adjustments totaled ~~$1.7~~$2.1 million in the first ~~six~~nine months of 2021 as compared to a ($~~3.3)~~2.8) million in fair value ~~adjustment in~~adjustments for the first ~~six~~nine months of 2020.

	For The Three Months Ended June 30,										For the Six Months Ended June 30,											For The Three Months Ended September 30,											For the Nine Months Ended September 30,
(unaudited, dollars in thousands)	2021		2020		$ Change			% Change			2021		2020			$ Change			% Change			2021		2020			$ Change			% Change			2021		2020			$ Change			% Change
Salaries and wages	$	37,435	$	36,773	$	662			1.8		$	74,324	$	75,683		$	(1,359	)		(1.8	)	$	39,497	$	38,342		$	1,155			3.0		$	113,822	$	114,025		$	(203	)		(0.2	)
Employee benefits		9,268		10,138		(870	)		(8.6	)		19,534		20,511			(977	)		(4.8	)		10,658		10,604			54			0.5			30,191		31,115			(924	)		(3.0	)
Net occupancy		6,427		6,634		(207	)		(3.1	)		13,605		13,717			(112	)		(0.8	)		6,825		7,092			(267	)		(3.8	)		20,430		20,809			(379	)		(1.8	)
Equipment and software		7,281		5,722		1,559			27.2			14,045		11,761			2,284			19.4			7,609		6,229			1,380			22.2			21,654		17,991			3,663			20.4
Marketing		1,802		1,567		235			15.0			4,185		2,705			1,480			54.7			1,848		1,577			271			17.2			6,033		4,282			1,751			40.9
FDIC insurance		181		2,395		(2,214	)		(92.4	)		1,462		4,508			(3,046	)		(67.6	)		1,227		1,948			(721	)		(37.0	)		2,690		6,456			(3,766	)		(58.3	)
Amortization of intangible assets		2,873		3,365		(492	)		(14.6	)		5,769		6,739			(970	)		(14.4	)		2,854		3,346			(492	)		(14.7	)		8,622		10,085			(1,463	)		(14.5	)
Restructuring and merger-related expenses		1,222		468		754			161.1			2,074		5,633			(3,559	)		(63.2	)		4,467		3,608			859			23.8			6,540		9,241			(2,701	)		(29.2	)
Franchise and other miscellaneous taxes		2,095		3,470		(1,375	)		(39.6	)		5,093		7,212			(2,119	)		(29.4	)		2,369		3,803			(1,434	)		(37.7	)		7,462		11,014			(3,552	)		(32.2	)
Consulting, regulatory, accounting and advisory fees		2,583		3,238		(655	)		(20.2	)		5,962		6,080			(118	)		(1.9	)		3,161		3,103			58			1.9			9,173		9,182			(9	)		(0.1	)
ATM and electronic banking interchange expenses		2,483		1,962		521			26.6			4,686		3,752			934			24.9			2,300		2,188			112			5.1			6,985		5,940			1,045			17.6
Postage and courier expenses		1,316		1,330		(14	)		(1.1	)		2,584		2,588			(4	)		(0.2	)		1,131		1,180			(49	)		(4.2	)		3,714		3,768			(54	)		(1.4	)
Legal fees		934		836		98			11.7			1,796		1,650			146			8.8			1,132		812			320			39.4			2,928		2,463			465			18.9
Communications		1,109		1,220		(111	)		(9.1	)		2,021		2,244			(223	)		(9.9	)		1,051		997			54			5.4			3,071		3,241			(170	)		(5.2	)
Supplies		857		1,310		(453	)		(34.6	)		1,876		2,527			(651	)		(25.8	)		1,039		993			46			4.6			2,915		3,520			(605	)		(17.2	)
Other real estate owned and foreclosure expenses		143		48		95			197.9			31		(17	)		48			282.4			180		(10	)		190			1,900.0			148		(27	)		175			648.1
Other		5,803		5,026		777			15.5			11,092		9,542			1,550			16.2			7,353		4,131			3,222			78.0			18,462		13,674			4,788			35.0
Total non-interest expense	$	83,812	$	85,502	$	(1,690	)		(2.0	)	$	170,139	$	176,835		$	(6,696	)		(3.8	)	$	94,701	$	89,943		$	4,758			5.3		$	264,840	$	266,779		$	(1,939	)		(0.7	)

Non-interest expense in the ~~second~~third quarter of 2021 ~~decreased $1.7~~increased $4.8 million or ~~2.0%~~5.3% compared to the same quarter in 2020, principally from a $3.2 million increase in other operating expenses, due to ~~a $2.2~~$2.6 million ~~reduction~~ in ~~FDIC insurance expense~~legal settlement costs, as well as a $1.2 million increase in salaries and wages and a $1.4 million increase in equipment and software expense. These increases were somewhat offset by a $1.4 million decrease in franchise and other miscellaneous ~~taxes. These decreases were somewhat offset by~~taxes and a ~~$1.6~~$0.7 million ~~increase~~decrease in ~~equipment expense from the three months ended June 30, 2020 to the three months ended June 30, 2021.~~FDIC insurance expense. In the ~~second~~third quarter of 2021, there were ~~$1.2~~$4.5 million of restructuring expenses related to the branch optimization strategy and ~~upcoming~~ core operating system ~~software~~ conversion as compared to ~~$0.5~~$3.6 million of restructuring and merger-related expenses related to the OLBK acquisition and branch optimization strategy in the ~~second~~third quarter of 2020. Excluding restructuring and merger-related expenses, non-interest expense ~~decreased $2.4~~increased $3.9 million or ~~2.9%~~4.5% from the ~~second~~third quarter of 2020 to the ~~second~~third quarter of 2021, and ~~$3.1~~$0.8 million or ~~1.8%~~0.3% from the first ~~six~~nine months of 2020 to the first ~~six~~nine months of 2021.

Salaries and wages increased ~~$0.7~~$1.2 million or ~~1.8%~~3.0% in the ~~second~~third quarter of 2021 from the ~~second~~third quarter of 2020 due primarily to increases in ~~bonus~~incentive compensation expense. Short term incentive expense ~~and commission expense. Bonus expense~~ increased $1.3 million as overall higher performance in 2021 is expected as compared to 2020, along with higher incentive stock compensation expense which is up by $0.5 million from the third quarter of 2020. Commission expense increased due to increased business transactions in commission-earning business lines, such as securities brokerage and mortgage loan originations. These increases were mitigated by ~~an 8.1%~~a 7.4% reduction in full time equivalent (“FTE”) employees from the ~~second~~third quarter of 2020 as a result of the closure of branches ~~early~~at various points in ~~the first quarter of~~ 2021, as the branch optimization strategy was executed, and a temporary hiring freeze earlier in 2021. For the ~~six~~nine months ended ~~June~~September 30, 2021, salaries and wages decreased by ~~$1.4~~$0.2 million or ~~1.8%~~0.2%, due primarily to the reduction in FTE ~~employees.~~ employees, mostly offset by the noted increases in incentive compensation.

Employee benefits expense ~~decreased $0.9~~increased $0.1 million or ~~8.6%~~0.5% in the ~~second~~third quarter of 2021 from the ~~second~~third quarter of 2020 ~~due to~~as reduced pension expense ~~as well as~~and a reduction in the market adjustment on the underlying investments of the deferred compensation ~~plan.~~plan mitigated a $1.4 million increase in health insurance expense resulting from an increase in claims in the third quarter of 2021. Employee benefits expense decreased $0.9 million or 3.0% in the first nine months of 2021 as compared to the same period in 2020 due to a decrease in pension expense and FTEs.

Equipment and software costs increased ~~$1.6~~$1.4 million or ~~27.2%~~22.2% compared to the ~~second~~third quarter of 2020, due to the core conversion, continuous improvements in technology and communication infrastructure, ~~software costs as well as~~an increase in asset size, increased usage of digital banking services and SBA PPP loan ~~and deposit origination and customer support platforms.~~forgiveness fees. For the ~~six~~nine months ended ~~June~~September 30, 2021, equipment costs increased ~~$2.3~~$3.7 million or ~~19.4%~~20.4% compared to the ~~six~~nine months ended ~~June~~September 30, 2020, for the same reasons as indicated for the three months ended. ~~In addition, higher core banking software costs were related to Wesbanco’s larger asset size after the OLBK acquisition and certain forgiveness costs related to PPP loans.~~

FDIC insurance decreased ~~$2.2~~$0.7 million or ~~92.4%~~37.0% compared to the ~~second~~third quarter of 2020, due to certain ~~prior period call report adjustments resulting in a $1.0 million refund as well as~~ improved large bank assessment rate risk factors, ultimately lowering the assessment rate. FDIC insurance decreased ~~$3.0~~$3.8 million or ~~67.6%~~58.3% in the first ~~six~~nine months of 2021 as compared to the first ~~six~~nine months of ~~2020.~~2020, due to a $1.0 million refund received in the second quarter of 2021 from prior period call report adjustments, as well as for the reason mentioned for the three months ended.

Restructuring and merger-related expenses in the ~~second~~third quarter of 2021 totaled ~~$1.2~~$4.5 million, an increase of ~~$0.8~~$0.9 million from the ~~second~~third quarter of 2020. The ~~$1.2~~$4.5 million of expenses in the ~~second~~third quarter of 2021 consisted of ~~$0.6~~$3.7 million in expenses related to the ~~upcoming~~ core banking software conversion, including termination fees of existing contracts, and ~~$0.6~~$0.8 million in branch closure and ~~severance~~lease termination expenses associated with the closure of six branches in July as a result of the continued execution of the branch optimization strategy. The restructuring and merger-related expenses in the ~~second~~third quarter of 2020 totaling $3.6 million were ~~all related~~comprised of $3.0 million in expenses relating to the branch optimization strategy announced in the prior year’s third quarter along with $0.6 million in merger-related expenses associated with the OLBK acquisition. ~~Restructuring~~For the nine months ended September 30, 2021, restructuring and ~~merger-related~~merger related expenses ~~decreased~~totaled $6.5 million as compared to $9.2 million for the nine months ended in the prior year period. The $6.5 million of expenses in the first ~~half~~nine months of 2021 ~~as compared to~~consisted of $4.9 million in core banking software conversion expenses and $1.6 million of branch restructuring expenses, while the $9.2 million in expenses in the first ~~half~~nine months of 2020 ~~by $3.6~~consisted of $6.3 million ~~or 63.2% due to the higher~~in OLBK ~~acquisition costs~~merger-related expenses and $2.9 million in ~~the prior period.~~branch restructuring expenses.

Franchise and other miscellaneous taxes decreased $1.4 million or ~~39.6%~~37.7% from the ~~second~~third quarter of 2020, primarily due to the elimination of Kentucky bank franchise taxes effective on January 1, 2021, as well as ~~a $0.8 million~~various state franchise tax ~~refund.~~filed return accrual adjustments and associated refunds. Wesbanco is now subject to Kentucky state income taxes, which are reflected within the provision for income taxes on the income statement, and is part of the Company’s effective tax rate calculation. For ~~the same reason,~~similar reasons, franchise and other miscellaneous taxes decreased ~~$2.1~~$3.6 million or ~~29.4%~~32.2% in the ~~six~~nine months ended ~~June~~September 30, 2021 as compared to the ~~six~~nine months ended ~~June~~September 30, 2020.

Consulting, regulatory, accounting and advisory fees decreased $0.7 million or 20.2% from the second quarter of 2020 due to decreases in audit and other professional fees. In addition, business loan swap fee expense decreased $0.2 million due to a decrease in swaps originated as compared to the second quarter of 2020.

The provision for income taxes was ~~$18.6~~$10.7 million for the three months ended ~~June~~September 30, 2021, which is ~~an $18.6~~a $3.0 million increase compared to ~~$42 thousand~~$7.7 million for the three months ended ~~June~~September 30, 2020. The increase in the provision for income taxes is due to an increase in the effective tax rate to ~~20.9%~~19.3% in the ~~second~~third quarter of 2021 compared to ~~0.9%~~15.7% in the ~~second~~third quarter of ~~2020, resulting~~2020. This increase resulted from higher pre-tax income primarily due to the negative provision for credit losses recorded in the ~~second~~third quarter of 2021, as compared to an increased provision for credit losses in the ~~second~~third quarter of 2020 due to the pandemic. In addition, as mentioned above, Kentucky state income taxes are now reflected within the provision for income taxes and the effective tax rate calculation for 2021. For the nine months ended September 30, 2021, the provision for income taxes was $47.4 million as compared to $11.3 million for the nine months ended September 30, 2020, reflecting the same reasons above as for the three months ended.

Total assets and deposits increased ~~3.3%~~2.8% and ~~7.2%~~8.0%, respectively, while shareholders’ equity ~~increased 0.9%~~decreased 1.2%, compared to December 31, 2020. Total securities increased $1.2 billion or ~~42.5%~~45.3% from December 31, 2020 to ~~June~~September 30, 2021, primarily driven by the purchase of mortgage-backed securities and municipal obligations with additional liquidity provided by ~~economic stimulus,~~CARES Act individual and family payments, as well as deposits from small businesses obtaining loans from the PPP program. The securities’ increase was partially offset by a ~~$25.7~~$37.1 million decrease in unrealized gains in the available-for-sale portfolio. Total portfolio loans, excluding PPP loans, decreased ~~$432.0~~$421.9 million or ~~4.0%~~4.2% as commercial, residential real estate, home equity and consumer loan pay downs outpaced new ~~originations, commercial line usage decreased to 32.3% from 33.9% at year-end, and forgiveness~~originations. Forgiveness related to the 2020 and 2021 PPP loan ~~program~~programs totaled ~~$662.1~~$939.7 million through the first ~~six~~nine months of 2021. Deposits increased ~~$888.9~~$993.9 million from year-end resulting from increases of ~~10.3%~~13.1%, ~~10.1%~~12.4%, and ~~5.1%~~4.7% in demand deposits, savings deposits, and money market deposits, respectively, which were partially offset by ~~an 8.3%~~a 16.3% decrease in certificates of deposit. The growth in transaction-based accounts is primarily attributable to CARES Act stimulus funds received, increased personal savings and reduced customer spending, focused retail and business strategies to obtain more account relationships and customers’ preferences for shorter-term maturities. The transaction accounts also increased from business customers obtaining loans from the PPP loan program and depositing proceeds in their checking accounts.

Deposits were also somewhat impacted by bonus and royalty payments for Marcellus and Utica shale gas payments from energy companies in Wesbanco’s southwestern Pennsylvania, eastern Ohio, and northern West Virginia markets. The decrease in certificates of deposit is a result of lower overall rates and management periodically offering lower than median competitive rates for maturing certificates of deposit and customer preferences for other deposit ~~types.~~types, which was partially offset by a $3.3 million increase in CDARS® balances. Also, certain IRA accounts were reclassified to savings account types upon the core conversion in August. Total borrowings decreased ~~34.7%~~46.2% or ~~$341.4~~$454.0 million during the first ~~six~~nine months of 2021 as additional liquidity permitted the pay down of maturing FHLB advances by ~~$235.0~~$340.1 million, coupled with ~~a $106.7~~an $89.4 million decrease in other short-term borrowings, ~~as many of these customer relationships were moved to interest bearing demand deposits.~~

and a $24.6 million decrease in subordinated debentures primarily from a $25.0 million early redemption in the third quarter. Total shareholders’ equity ~~increased~~decreased approximately ~~$24.1~~$32.8 million or ~~0.9%~~1.2%, compared to December 31, 2020, primarily due to ~~net income exceeding dividends for the period by $94.3 million, which was partially offset by an $18.8~~a $26.9 million decrease in other comprehensive income and the repurchase of common shares totaling ~~$55.6~~$128.0 million, which were partially offset by net income exceeding dividends for the period by $115.1 million.

	June 30,			December 31,									September 30,			December 31,
(unaudited, dollars in thousands)	2021			2020			Change ($)			Change (%)			2021			2020			Change ($)			Change (%)
Equity securities (at fair value)	$	13,494		$	13,047		$	447			3.4		$	13,451		$	13,047		$	404			3.1
Available-for-sale debt securities (at fair value)
U.S. Treasury		19,998			39,982			(19,984	)		(50.0	)		10,000			39,982			(29,982	)		(75.0	)
U.S. Government sponsored entities and agencies		212,490			211,682			808			0.4			233,435			211,682			21,753			10.3
Residential mortgage-backed securities and collateralized mortgage obligations of government sponsored entities and agencies		2,280,766			1,264,737			1,016,029			80.3			2,294,456			1,264,737			1,029,719			81.4
Commercial mortgage-backed securities and collateralized mortgage obligations of government sponsored entities and agencies		316,285			320,098			(3,813	)		(1.2	)		321,549			320,098			1,451			0.5
Obligations of states and political subdivisions		110,097			115,762			(5,665	)		(4.9	)		109,821			115,762			(5,941	)		(5.1	)
Corporate debt securities		24,628			25,875			(1,247	)		(4.8	)		17,542			25,875			(8,333	)		(32.2	)
Total available-for-sale debt securities	$	2,964,264		$	1,978,136		$	986,128			49.9		$	2,986,803		$	1,978,136		$	1,008,667			51.0
Held-to-maturity debt securities (at amortized cost)
U.S. Government sponsored entities and agencies	$	6,867		$	7,779		$	(912	)		(11.7	)	$	6,639		$	7,779		$	(1,140	)		(14.7	)
Residential mortgage-backed securities and collateralized mortgage obligations of government sponsored entities and agencies		70,745			89,151			(18,406	)		(20.6	)		63,682			89,151			(25,469	)		(28.6	)
Obligations of states and political subdivisions		791,441			601,128			190,313			31.7			850,498			601,128			249,370			41.5
Corporate debt securities		33,119			33,154			(35	)		(0.1	)		33,101			33,154			(53	)		(0.2	)
Total held-to-maturity debt securities		902,172			731,212			170,960			23.4			953,920			731,212			222,708			30.5
Total securities	$	3,879,930		$	2,722,395		$	1,157,535			42.5		$	3,954,174		$	2,722,395		$	1,231,779			45.2
Available-for-sale and equity securities:
Weighted average yield at the respective period end ⁽²⁾		1.66	%		2.09	%								1.55	%		2.09	%
As a % of total securities		76.7	%		73.1	%								75.9	%		73.1	%
Weighted average life (in years)		4.6			3.4									4.5			3.4
Held-to-maturity securities:
Weighted average yield at the respective period end ⁽²⁾		3.06	%		3.35	%								2.98	%		3.35	%
As a % of total securities		23.3	%		26.9	%								24.1	%		26.9	%
Weighted average life (in years)		5.0			3.8									5.6			3.8
Total securities:
Weighted average yield at the respective period end ⁽²⁾		1.99	%		2.43	%								1.90	%		2.43	%
As a % of total securities		100.0	%		100.0	%								100.0	%		100.0	%
Weighted average life (in years)		4.7			3.5									4.7			3.5

Total investment securities, which are a source of liquidity for Wesbanco as well as a contributor to interest income, increased $1.2 billion or ~~42.5%~~45.2% from December 31, 2020 to ~~June~~September 30, 2021, and represented ~~22.9%~~23.4% of total assets at period-end as compared to 16.6% at December 31, 2020. Through the first ~~six~~nine months of 2021, the available-for-sale portfolio increased ~~$986.1 million~~$1.0 billion or ~~49.9%~~51.0%, primarily due to excess liquidity from stimulus deposits and increased calls of agency and municipal securities, funding ~~$1.5~~$1.7 billion in purchases of residential mortgage-backed securities and collateralized mortgage obligations. Residential mortgage-backed securities and collateralized mortgage obligations ~~while~~totaled 59.6% of the total investment portfolio at September 30, 2021. The held-to-maturity portfolio increased ~~$171.0~~$222.7 million or ~~23.4%~~30.5% due to ~~$228.3~~$307.2 million in purchases of municipal bonds. The weighted average yield of the portfolio decreased by 4353 basis points from ~~2.09%~~2.43% at December 31, 2020 to ~~1.66%~~1.90% at ~~June~~September 30, 2021, due to prepayments and calls of legacy higher rate agency and municipal securities and the previously mentioned purchases at lower current market rates. Higher premium amortization was also a factor in the yield reduction.

Net unrealized gains on available-for-sale securities included in accumulated other comprehensive income, net of tax, as of ~~June~~September 30, 2021 and December 31, 2020 were ~~$27.1~~$18.5 million and $46.9 million, respectively. The net unrealized pre-tax gains represent temporary fluctuations resulting from changes in market rates in relation to fixed yields in the available-for-sale portfolio, and on an after tax-basis are accounted for as an adjustment to other comprehensive income in shareholders’ equity. Net unrealized pre-tax gains in the held-to-maturity portfolio, which are not accounted for in other comprehensive income, were ~~$32.3~~$24.6 million at ~~June~~September 30, 2021, compared to $37.0 million at December 31, 2020. With approximately ~~23%~~24% of the investment portfolio in the held-to-maturity category, the recent volatility in interest rates does not have as much impact on other comprehensive income as if the entire portfolio were included in the available-for-sale category. The decrease in unrealized gains from year-end ~~are~~is due to an increase in market rates over the first ~~six~~nine months of the year coupled with prepayments and calls of higher-rate ~~securities.~~securities, and purchases of securities at lower, current market rates.

Equity securities, of which a portion consist of investments in various mutual funds held in grantor trusts formed in connection with a key officer and director deferred compensation plan, are recorded at fair value. Gains and losses due to fair value fluctuations on equity securities are included in net securities gains or losses. For those equity securities relating to the key officer and director deferred compensation plan, the corresponding change in the obligation to the employee is recognized in employee benefits expense.

Wesbanco’s municipal portfolio represented ~~23.2%~~24.3% of the overall securities portfolio as of ~~June~~September 30, 2021 compared to 26.3% as of December 31, 2020, and it carries different risks that are not as prevalent in other security types contained in the portfolio. The following table presents the allocation of the individual bonds in the municipal bond portfolio based on the combined ratings of two major bond credit rating agencies (at fair value):

	June 30, 2021				December 31, 2020				September 30, 2021				December 31, 2020
(unaudited, dollars in thousands)	Amount		% of Total		Amount		% of Total		Amount		% of Total		Amount		% of Total
Municipal bonds (at fair value) ⁽¹⁾:
Investment Grade - Prime	$	97,007		10.4	$	72,861		9.8	$	98,883		10.1	$	72,861		9.8
Investment Grade - High		672,096		72.4		511,013		68.4		723,701		73.8		511,013		68.4
Investment Grade - Upper Medium		151,991		16.4		152,704		20.4		150,439		15.3		152,704		20.4
Investment Grade - Lower Medium		3,025		0.3		3,072		0.4		3,006		0.3		3,072		0.4
Non-Investment Grade - Speculative		—		—		—		—		—		—		—		—
Not rated by either agency		4,509		0.5		7,354		1.0		4,196		0.5		7,354		1.0
Total municipal bond portfolio	$	928,628		100.0	$	747,004		100.0	$	980,225		100.0	$	747,004		100.0

Wesbanco’s municipal bond portfolio at ~~June~~September 30, 2021 consists of ~~$270.8~~$281.2 million of taxable and ~~$657.8~~$699.0 million of tax-exempt general obligation and revenue bonds. The following table presents additional information regarding the municipal bond type and issuer (at fair value):

	June 30, 2021				December 31, 2020				September 30, 2021				December 31, 2020
(unaudited, dollars in thousands)	Amount		% of Total		Amount		% of Total		Amount		% of Total		Amount		% of Total
Municipal bond type:
General Obligation	$	658,844		70.9	$	518,274		69.4	$	697,345		71.1	$	518,274		69.4
Revenue		269,784		29.1		228,730		30.6		282,880		28.9		228,730		30.6
Total municipal bond portfolio	$	928,628		100.0	$	747,004		100.0	$	980,225		100.0	$	747,004		100.0
Municipal bond issuer:
State Issued	$	40,883		4.4	$	46,843		6.3	$	42,522		4.3	$	46,843		6.3
Local Issued		887,745		95.6		700,161		93.7		937,703		95.7		700,161		93.7
Total municipal bond portfolio	$	928,628		100.0	$	747,004		100.0	$	980,225		100.0	$	747,004		100.0

Wesbanco’s municipal bond portfolio is broadly spread across the United States. The following table presents the top five states of municipal bond concentration based on total fair value at ~~June~~September 30, 2021:

	June 30, 2021				September 30, 2021
(unaudited, dollars in thousands)	Fair Value		% of Total		Fair Value		% of Total
Pennsylvania	$	187,640		20.2	$	219,264		22.4
California		113,661		12.2		118,270		12.1
Ohio		104,259		11.2		104,631		10.7
Texas		74,054		8.0		69,767		7.1
Kentucky		40,364		4.3		38,893		4.0
All other states		408,650		44.1		429,400		43.7
Total municipal bond portfolio	$	928,628		100.0	$	980,225		100.0

Wesbanco uses prices from independent pricing services and, to a lesser extent, indicative (non-binding) quotes from independent brokers, to measure the fair value of its securities. Wesbanco validates prices received from pricing services or brokers using a variety of methods, including, but not limited to, comparison to secondary pricing services, corroboration of pricing by reference to other independent market data such as secondary broker quotes and relevant benchmark indices, review of pricing by personnel familiar with market liquidity and other market-related conditions, review of pricing service methodologies, review of independent auditor reports received from the pricing service regarding its internal controls, and through review of inputs and assumptions used in pricing certain securities thinly traded or with limited observable data points. The procedures in place provide management with a sufficient understanding of the valuation models, assumptions, inputs and pricing to reasonably measure the fair

value of Wesbanco’s securities. For additional disclosure relating to fair value measurements, refer to Note 7, “Fair Value Measurement” in the Consolidated Financial Statements.

Loans represent Wesbanco’s single largest balance sheet asset classification and the largest source of interest income. Business purpose loans consist of CRE loans and other C&I loans that are not secured by real estate. CRE loans are further segmented into land and construction loans, and loans for improved property. Consumer purpose loans consist of residential real estate loans, home equity lines of credit and other consumer loans. Loans held for sale generally consist of residential real estate loans originated for sale in the secondary market, but at times may also include other types of loans. The outstanding balance of each major category of the loan portfolio is summarized in Table 10.

The risk that borrowers will be unable or unwilling to repay their obligations and default on loans is inherent in all lending activities. Credit risk arises from many sources including general economic conditions, external events that impact businesses or industries, isolated events that impact a major employer, individual loss of employment or other personal hardships as well as changes in interest rates or the value of collateral. Credit risk is also impacted by a concentration of exposure within a geographic market or to one or more borrowers, industries or collateral types. The primary goal in managing credit risk is to minimize the impact of default by an individual borrower or group of borrowers. Credit risk is managed through the initial underwriting process as well as through ongoing monitoring and administration of the portfolio that varies by the type of loan. The Bank’s credit policies establish standard underwriting guidelines for each type of loan and require an appropriate evaluation of the credit characteristics of each borrower. This evaluation includes the borrower’s primary source of repayment capacity; the adequacy of collateral, if any, to secure the loan; the potential value of personal guarantees as secondary sources of repayment; and other factors unique to each loan that may increase or mitigate its risk. Credit bureau scores are also considered when evaluating consumer purpose loans as well as guarantors of business purpose loans. However, the Bank does not periodically update credit bureau scores subsequent to when loans are made to determine changes in credit history.

Credit risk is mitigated for all types of loans by continuously monitoring delinquency levels and pursuing collection efforts at the earliest stage of delinquency. The Bank also monitors general economic conditions, including employment, housing activity and real estate values in its market. The Bank also periodically evaluates and changes its underwriting standards when warranted based on market conditions, the historical performance of a category of the portfolio, or other external factors. Credit risk is also regularly evaluated for the impact of adverse economic and other events, such as the current COVID-19 pandemic crisis, that increase the risk of default and the potential loss in the event of default, to understand the impact on the Bank’s earnings and capital.

Commercial loan risk grades are determined based on an evaluation of the relevant characteristics of each loan, assigned at inception and adjusted thereafter at any time to reflect changes in the risk profile throughout the life of each loan. The primary factors used to determine the risk grade are the sufficiency, reliability and sustainability of the primary source of repayment and overall financial strength of the borrower. The rating system more heavily weights the debt service coverage, leverage and loan-to-value factors to derive the risk grade. Other factors that are considered at a lesser weighting include management, industry or property-type risks, payment history, collateral and guarantees.

	June 30, 2021				December 31, 2020				September 30, 2021				December 31, 2020
(unaudited, dollars in thousands)	Amount		% of Loans		Amount		% of Loans		Amount		% of Loans		Amount		% of Loans
Commercial real estate:
Land and construction	$	588,218		5.7	$	668,277		6.1	$	824,199		8.3	$	668,277		6.1
Improved property		5,117,028		49.2		5,037,115		46.0		4,833,687		48.6		5,037,115		46.0
Total commercial real estate		5,705,246		54.9		5,705,392		52.1		5,657,886		56.9		5,705,392		52.1
Commercial and industrial		1,575,612		15.2		1,681,182		15.4		1,435,154		14.4		1,681,182		15.4
Commercial and industrial - PPP		543,574		5.2		726,256		6.6		272,060		2.7		726,256		6.6
Residential real estate		1,625,632		15.6		1,720,961		15.7		1,655,229		16.7		1,720,961		15.7
Home equity		631,059		6.1		646,387		5.9		607,735		6.1		646,387		5.9
Consumer		276,069		2.7		309,055		2.8		285,101		2.9		309,055		2.8
Total portfolio loans		10,357,192		99.7		10,789,233		98.5		9,913,165		99.7		10,789,233		98.5
Loans held for sale		41,461		0.3		168,378		1.5		32,308		0.3		168,378		1.5
Total loans	$	10,398,653		100.0	$	10,957,611		100.0	$	9,945,473		100.0	$	10,957,611		100.0

Total portfolio loans decreased ~~$432.0~~$876.1 million or ~~4.0%~~8.1% from December 31, 2020, while they decreased ~~$717.0 million~~$1.1 billion or ~~6.5%~~9.8% over the last twelve months. Most of the loan decrease was due to the forgiveness of ~~$662.1 billion~~$939.7 million of PPP loans during the last twelve months, of which ~~$543.6~~$272.1 million remain in the portfolio as of ~~June~~September 30, 2021. Excluding PPP loans, total portfolio loans decreased over the last twelve months by ~~4.1% as~~4.9% reflecting the higher than anticipated commercial real estate payoffs, continued low commercial line ~~usage decreased~~of credit utilization, and the impact of selling a higher percentage of ~~new~~1-to-4 family residential ~~loans originated were sold into~~mortgage originations in the secondary ~~market as opposed to holding them in the residential loan portfolio.~~market. Consumer loan demand also decreased as a result of the pandemic reducing consumer spending. Slightly offsetting the total decrease was ~~1.9%~~19.4% of growth in the land and construction portfolio. This increase is due to $187.1 million of loan reclassifications out of commercial real estate ~~improved property.~~in the third quarter of 2021. Commercial and industrial loans decreased ~~5.0%~~13.2%, due ~~primarily~~ to ~~the lower line usage mentioned above and~~ lower overall ~~demand.~~demand and partially from certain reclassifications into commercial real estate. Residential real estate loans decreased ~~14.2%~~7.9% over the last twelve months, due to a greater portion of new originations sold into the secondary market and a greater portion of existing loans refinanced with other banks, while home equity loans experienced lower demand and were also refinanced into first mortgages due to customer preferences for fixed rate loans. Consumer loans ~~dropped~~declined due to pricing adjustments for indirect lending ~~and~~as well as refinancing or repayment of existing loans.

Total loan commitments of ~~$3.4~~$3.8 billion, including loans approved but not closed, increased ~~$174.1~~$553.2 million or ~~5.4%~~17.1% from December 31, 2020 due primarily to increases in ~~loans approved but not closed~~availabilities under lines of credit, deposit overdrafts and contingent obligations. The line utilization percentage for the commercial portfolio was ~~32.3%~~37.0% at ~~June~~September 30, 2021 compared to 33.9% as of December 31, 2020.

The commercial portfolio is monitored for potential concentrations of credit risk by market, type of lending, CRE property type, C&I and owner-occupied CRE by industry, investment CRE dependence on common tenants and industries or property types that are similarly impacted by external factors.

Loans held for sale at both ~~June~~September 30, 2021 and December 31, 2020 are originated residential mortgages that are committed to be sold into the secondary market. Loans held for sale decreased by ~~$126.9~~$136.1 million or ~~75.4%~~80.8% from December 31, 2020 due to additional staffing in the secondary mortgage operations area and a specific effort to accelerate the speed at which the loans are delivered to the ~~investor.~~investor, as well as more originations held in the loan portfolio in the third quarter.

Wesbanco has participated in the PPP loan program as originally established by the CARES Act. As of ~~June~~September 30, 2021, the Company has funded nearly 11,300 loans totaling $1.2 billion to qualifying small businesses, non-profits and organizations throughout our six-state footprint. The loans carry an interest rate of 1%, are generally for a two-year or five-year maturity, and were originated with a percentage fee paid by the SBA directly to the Bank depending on the size of the loan originated. At ~~June~~September 30, 2021, remaining unaccreted fees, net of deferred origination costs, were ~~$17.6~~$10.4 million. This total is comprised of ~~$15.3~~$10.1 million remaining on the 2021 originated PPP loans and ~~$2.3~~$0.3 million remaining on the 2020 originated PPP loans. The loans are subject to forgiveness by the SBA under certain defined circumstances, and it is anticipated a high percentage of such loans will meet such requirements (as revised) over the next few quarters, with ~~$651.6~~$825.4 million of 2020 originated PPP loans, or approximately 97% of 2020 PPP loan originations and ~~$10.5~~$114.3 million, or approximately 31% of 2021 ~~originated~~ PPP ~~loans~~loan originations, having been forgiven as of ~~June~~September 30, 2021.

June 30, 2021

Land and Construction

Improved Property

Commercial and Industrial

PPP

(unaudited, dollars in thousands)

Balance

Commitment

Balance

Commitment

Balance

Commitment

Loan Balance

Total Loan Balance

Total
Exposure

% of
Capital (1)

Agriculture and farming

$
14,763

$
2,446

$
3,303

$
432

$
7,178

$
6,073

$
4,036

$
29,280

$
38,231

2.2

Energy

4,891

—

40,567

1,042

76,676

54,352

4,347

126,481

181,875

10.6

Construction

90,259

74,545

136,787

26,719

150,751

189,793

103,719

481,516

772,573

45.0

Manufacturing

1,079

1,090

96,477

11,910

142,476

110,566

59,643

299,675

423,241

24.7

Wholesale and distribution

—

200

46,190

5,393

117,807

59,166

15,901

179,898

244,657

14.3

Retail

6,242

2,832

274,288

14,753

91,231

81,698

27,632

399,393

498,676

29.0

Transportation and warehousing

2,073

508

63,572

1,982

40,075

14,960

19,793

125,513

142,963

8.3

Information and communications

1,478

115

10,148

121

7,287

8,344

2,630

21,543

30,123

1.8

Finance and insurance

651

7

12,574

2,747

66,629

128,633

4,612

84,466

215,853

12.6

Equipment leasing

—

—

22,870

524

44,406

31,205

4,315

71,591

103,320

6.0

Real estate - 1-4 family

16,398

4,960

263,874

10,288

45,346

3,391

—

325,618

344,257

20.1

Real estate - multi-family

217,267

188,857

500,108

9,063

11,931

1

—

729,306

927,227

54.0

Real estate - other retail

98

1,202

252,119

3,934

5,293

—

—

257,510

262,646

15.3

Real estate - shopping center

12,264

209

317,075

9,233

—

—

—

329,339

338,781

19.7

Real estate - office building

14,751

2,716

482,413

21,533

14,375

2,589

—

511,539

538,377

31.4

Real estate - commercial/manufacturing

1,424

2,531

352,743

11,198

9,709

504

—

363,876

378,109

22.0

Real estate - residential buildings

39,209

133,487

185,347

84,636

29,175

18,598

5,060

258,791

495,512

28.9

Real estate - other

48,749

14,099

440,978

16,812

45,326

29,845

5,565

540,618

601,374

35.0

Services

8,907

5,477

196,062

4,755

150,481

109,716

89,799

445,249

565,197

32.9

Schools and education services

23,752

210

33,083

981

93,948

11,340

14,098

164,881

177,412

10.3

Healthcare

33,495

24,449

393,484

36,258

132,480

60,327

73,103

632,562

753,596

43.9

Entertainment and recreation

1,308

103

47,675

1,116

12,879

3,922

9,754

71,616

76,757

4.5

Hotels

—

8,500

715,196

11,069

6,621

880

21,321

743,138

763,587

44.5

Other accommodations

6,185

3,831

31,728

2,710

4,021

363

698

42,632

49,536

2.9

Restaurants

4,936

2,774

96,481

2,463

57,400

21,688

53,366

212,183

239,108

13.9

Religious organizations

4,004

7,243

73,444

3,258

38,358

23,768

4,266

120,072

154,341

9.0

Government

33,655

3,157

17,258

222

141,563

19,447

3,227

195,703

218,529

12.7

Unclassified

380

25,560

11,184

58,087

32,190

76,499

16,689

60,443

220,589

12.8

Total commercial loans

$
588,218

$
511,108

$
5,117,028

$
353,239

$
1,575,612

$
1,067,668

$
543,574

$
7,824,432

$
9,756,447

568.3

Wesbanco met the needs of the communities it serves by providing appropriate relief tailored to the individual needs of the customer, ranging from three months of interest-only for those minimally impacted, up to and including full principal and interest deferral for six months for those significantly impacted, while also providing additional tailored relief to the hospitality industry where appropriate. The relief was provided in as many as three phases depending on the ~~circumstances.~~circumstances.

Under the CARES Act, Wesbanco ~~has~~ modified approximately 3,550 loans totaling $2.2 billion in 2020, of which a total of ~~$151.6~~$132.8 million of commercial loans, representing ~~1.5%~~1.3% of total portfolio loans ~~are currently~~remain in ~~their~~ deferral ~~period~~ as of ~~June~~September 30, 2021. An additional ~~$98.5~~$97.9 million of commercial loans had various payment terms modified in exchange for enhancements beneficial to the Bank which were permanent improvements to the credit facility. Changes include an increase in floor rates, increase in guarantors and duration of guarantees and a change in covenants. None of the aforementioned loans were considered delinquent or on non-accrual status as of ~~June~~September 30, 2021.

All of the real estate sectors combined represent the largest industry exposure at $3.9 billion, of which multi-family, office buildings and residential are the largest categories within real estate. Multi-family makes up $927.2 million or 54.0% of total risk-based capital, office buildings are $538.4 million or 31.4% of total risk-based capital and residential buildings are $495.5 million or 28.9% of total risk-based capital.

~~The construction sectors combined represent the second largest industry exposure at $772.6 million or 45.0% of risk-based capital.~~

The hotel sector represents the third largest industry exposure at $763.6 million or 44.5% of risk-based capital. For loan modifications allowed under the CARES Act, there were $139.6 million or 8.1% of total risk-based capital of hotel loans in deferral as of June 30, 2021. The majority of these loans were deferred for up to twelve months based on specific criteria related to the borrower.

~~Healthcare represents the fourth largest industry exposure at $753.6 million or 43.9% of total risk-based capital.~~

Non-performing assets consist of non-accrual loans and TDRs, other real estate acquired through or in lieu of foreclosure, bank premises held for sale, and repossessed automobiles acquired to satisfy defaulted consumer loans.

(unaudited, dollars in thousands)	June 30, 2021			December 31, 2020			September 30, 2021			December 31, 2020
Non-accrual loans:
Commercial real estate - land and construction	$	74		$	469		$	145		$	469
Commercial real estate - improved property		8,338			9,494			7,572			9,494
Commercial and industrial		4,572			3,302			5,350			3,302
Residential real estate		17,567			17,925			17,643			17,925
Home equity		5,370			5,345			5,061			5,345
Consumer		291			345			488			345
Total non-accrual loans ⁽¹⁾		36,212			36,880			36,259			36,880
TDRs accruing interest:
Commercial real estate - land and construction		—			—			—			—
Commercial real estate - improved property		418			655			382			655
Commercial and industrial		97			111			23			111
Residential real estate		4,876			2,779			3,012			2,779
Home equity		396			363			260			363
Consumer		12			19			30			19
Total TDRs accruing interest ⁽¹⁾		5,799			3,927			3,707			3,927
Total non-performing loans	$	42,011		$	40,807		$	39,966		$	40,807
Other real estate owned and repossessed assets		773			549			293			549
Total non-performing assets	$	42,784		$	41,356		$	40,259		$	41,356
Non-performing loans/total portfolio loans		0.41	%		0.38	%		0.40	%		0.38	%
Non-performing assets/total assets		0.25	%		0.25	%		0.24	%		0.25	%
Non-performing assets/total portfolio loans, other real estate and repossessed assets		0.41	%		0.38	%		0.41	%		0.38	%

Non-performing loans, which consist of non-accrual loans and TDRs, ~~increased $1.2~~decreased $0.8 million or ~~3.0%~~2.1%, from December 31, ~~2020, due to two new TDR residential real estate relationships of $2.1 million. Accruing TDR~~2020. Non-accrual balances have ~~increased $1.9~~decreased $0.6 million and accruing TDR balance decreased $0.2 million from December 31, 2020 to ~~June~~September 30, 2021. (Please see the Notes to the Consolidated Financial Statements for additional discussion.)

Section 4013 of the CARES Act allows financial institutions the option to temporarily suspend certain requirements under U.S. GAAP related to TDRs for a limited period of time during the COVID-19 pandemic. These customers must meet certain criteria, such as they were in good standing and not more than 30 days past due as of December 31, 2019, as well as other requirements. Based on this guidance, Wesbanco ~~does~~did not classify the COVID-19 loan modifications as TDRs, nor are the customers considered past due with regards to their delayed payments. Upon exiting the loan modification deferral program, the measurement of loan delinquency will resume where it left off upon entry into the program. ~~As of June~~Through September 30, 2021, Wesbanco has offered various deferred ~~payments~~payment schedules to commercial and retail customers impacted by the COVID-19 pandemic, depending on the type of loan and the industry-type for commercial loans.

Other real estate owned and repossessed assets ~~increased $0.2~~decreased to $0.3 million from December 31, ~~2020 primarily due to the addition of one residential property.~~2020. At ~~June~~September 30, 2021 and December 31, 2020, formal foreclosure proceedings were in process on residential real estate loans totaling $1.9 million and $1.8 million at each period, respectively. As a result of provisions of the CARES Act, certain residential real estate loans are temporarily suspended from entering foreclosure proceedings. The balance of these loans totaled ~~$2.6~~$3.6 million and $2.3 million at ~~June~~September 30, 2021 and December 31, 2020, respectively.

The following table presents past due and accruing loans excluding non-accrual and TDRs:

(unaudited, dollars in thousands)	June 30, 2021			December 31, 2020			September 30, 2021			December 31, 2020
Loans past due 90 days or more:
Commercial real estate - land and construction	$	83		$	288		$	1,256		$	288
Commercial real estate - improved property		2,453			2,713			2,308			2,713
Commercial and industrial		3,224			1,899			4,781			1,899
Residential real estate		1,886			2,863			1,746			2,863
Home equity		409			706			851			706
Consumer		263			377			310			377
Total loans past due 90 days or more		8,318			8,846			11,252			8,846
Loans past due 30 to 89 days:
Commercial real estate - land and construction		1,149			2,858			1,731			2,858
Commercial real estate - improved property		11,296			8,948			10,494			8,948
Commercial and industrial		2,575			6,540			9,356			6,540
Residential real estate		1,893			7,490			4,980			7,490
Home equity		2,072			2,754			3,055			2,754
Consumer		2,248			3,006			3,066			3,006
Total loans past due 30 to 89 days		21,233			31,596			32,682			31,596
Total loans 30 days or more past due	$	29,551		$	40,442		$	43,934		$	40,442
Loans past due 90 days or more and accruing to total portfolio loans		0.08	%		0.08	%		0.11	%		0.08	%
Loans past due 30-89 days and accruing to total portfolio loans		0.21	%		0.29	%		0.33	%		0.29	%

Loans past due 30 days or more and accruing interest, excluding non-accruals and TDRs, ~~decreased $10.9~~increased $3.5 million or ~~26.9%~~8.6% from December 31, 2020. These loans continue to accrue interest because they are both well-secured and in the process of collection. Loans 90 days or more past due ~~decreased $0.5~~increased $2.4 million and represented 0.11% and 0.08% of total portfolio loans at ~~June~~September 30, 2021 and December 31, ~~2020. While past due loans decreased overall, loans~~2020, respectively. Loans 90 days past due increased in the commercial and industrial category due to one ~~$2.5~~$3.2 million loan. ~~The decrease in the 30 to 89 days past due status was primarily due to the renewals of certain OLBK-acquired commercial lines of credit that are being adjusted to Wesbanco’s underwriting standards.~~ The 30 – 89 days past due category represented ~~0.21%~~0.33% of total loans at ~~June~~September 30, 2021 and 0.29% at December 31, 2020. Loans currently modified as permitted by the regulatory authorities and the CARES Act are not included in Tables 13 or 14, as they are not considered ~~non-performing or~~ past due.

As of ~~June~~September 30, 2021, the total allowance for credit losses – loans and commitments was ~~$146.5~~$143.9 million, of which ~~$140.7~~$136.6 million ~~relates~~related to loans and ~~$5.8~~$7.3 million ~~relates~~related to loan commitments. The allowance for credit losses – loans ~~is 1.36%~~was 1.38% of total portfolio loans as of ~~June~~September 30, 2021, compared to 1.72% as of December 31, 2020. Excluding PPP loans of ~~$543.6~~$272.1 million, the allowance for credit losses – loans ~~is 1.43%~~was 1.42% of total portfolio loans as of ~~June~~September 30, 2021, as compared to 1.85% of total portfolio loans at December 31, 2020. As per regulatory guidance, there is no calculated allowance on PPP loans due to their government guarantees by the SBA.

The allowance for credit losses - loans individually-evaluated ~~decreased $0.3~~increased $11.0 million from December 31, 2020 to ~~June~~September 30, 2021. The population of individually-evaluated loans consisted of eight hotel loans, with a total loan balance of $37.1 million. These loans were moved to individually-evaluated in the third quarter of 2021. The allowance for loans collectively-evaluated decreased from December 31, 2020 to ~~June~~September 30, 2021 by ~~$44.8~~$60.2 million.

The allowance for credit losses - loan commitments was ~~$5.8~~$7.3 million at ~~June~~September 30, 2021 as compared to $9.5 million as of December 31, 2020, and is included in other liabilities on the Consolidated Balance Sheets.

The allowance for credit losses by loan category, presented in Note 4, “Loans and the Allowance for Credit Losses” of the Consolidated Financial Statements, summarizes the impact of changes in various factors that affect the allowance for loan losses in each segment of the portfolio.

The allowance for credit losses under CECL is calculated utilizing the PD/LGD, which is then discounted to net present value. PD is the probability the asset will default within a given time frame and LGD is the percentage of the asset not expected to be collected due to default. The primary macroeconomic drivers of the quantitative model include forecasts of national unemployment and interest rates, as well as modeling adjustments for changes in prepayment speeds, loan risk grades, portfolio mix, concentrations and loan growth. For the calculation as of ~~June~~September 30, 2021, the forecast was based upon a blend of two nationally-recognized published economic forecasts through ~~June~~September 30, 2021, and iswas primarily driven by national unemployment and interest rate spread forecasts. At quarter-end, national unemployment was projected to peak at ~~5.2%~~4.7%, and subsequently decrease to an average of ~~4.2%~~4.0% over the remainder of the forecast period. ~~Additionally, at June 30, 2021, a~~The resurgence in leisure travel continued through September 30, 2021, which led to improvements in debt service coverage and revenue per available room (“RevPAR”) across the hotel portfolio. ~~As such, the hotel qualitative factor was reduced. Furthermore, there was a reduction in the COVID qualitative factor due to improving economic conditions.~~ The improvement in the macroeconomic factors and COVID qualitative factors, including those specifically for the hospitality portfolio, caused the allowance to decrease from December 31, 2020 to ~~June~~September 30, 2021, by ~~$48.8~~$51.4 million.

If forecasted projections of national unemployment remain consistent with the forecast utilized by Wesbanco as of ~~June~~September 30, 2021 throughout the rest of the year, this may result in additional, but less significant, future quarterly decreases in the allowance for credit losses, depending upon other model variables such as qualitative factors specifically for hotels and the COVID-19 pandemic.

Criticized and classified loans were ~~4.4%~~4.2% of total portfolio loans, decreasing from 4.6% at December 31, 2020. Criticized and classified loans decreased ~~$38.6~~$77.6 million from December 31, 2020 to ~~$456.4~~$417.3 million at ~~June~~September 30, 2021, primarily due to upgrades on certain hospitality ~~loans during the first quarter of 2021.~~loans. See Footnote 4, “Loans and the Allowance for Credit Losses” for more information.

Table 1513 summarizes the allocation of the allowance for credit losses to each category of the loan portfolio. ~~The overall allowance for loans decreased due to improvements in forecasted economic factors.~~

TABLE ~~15.~~13. ALLOCATION OF THE ALLOWANCE FOR CREDIT LOSSES – LOANS AND LOAN COMMITMENTS

(unaudited, dollars in thousands)	June 30, 2021		Percent of Total		December 31, 2020		Percent of Total		September 30, 2021		Percent of Total		December 31, 2020		Percent of Total
Allowance for credit losses - loans:
Commercial real estate - land and construction	$	6,189		4.2	$	10,841		5.6	$	7,264		5.0	$	10,841		5.6
Commercial real estate - improved property		85,391		58.3		110,652		56.6		81,601		56.7		110,652		56.6
Commercial and industrial		29,464		20.1		37,850		19.4		27,201		18.9		37,850		19.4
Residential real estate		13,617		9.3		17,851		9.1		14,413		10.0		17,851		9.1
Home equity		834		0.6		1,487		0.8		699		0.5		1,487		0.8
Consumer		4,179		2.9		6,507		3.3		3,747		2.6		6,507		3.3
Deposit account overdrafts		1,056		0.7		639		0.3		1,680		1.2		639		0.3
Total allowance for credit losses - loans	$	140,730		96.1	$	185,827		95.1	$	136,605		94.9	$	185,827		95.1
Allowance for credit losses - loan commitments:
Commercial real estate - land and construction	$	3,579		2.4	$	6,508		3.3	$	3,679		2.7	$	6,508		3.3
Commercial real estate - improved property		94		0.1		712		0.4		318		0.2		712		0.4
Commercial and industrial		941		0.7		1,275		0.7		1,726		1.2		1,275		0.7
Residential real estate		1,066		0.7		955		0.5		1,209		0.8		955		0.5
Home equity		50		0.0		45		0.0		52		0.0		45		0.0
Consumer		36		0.0		19		0.0		306		0.2		19		0.0
Total allowance for credit losses - loan commitments		5,766		3.9		9,514		4.9		7,290		5.1		9,514		4.9
Total allowance for credit losses - loans and loan commitments	$	146,496		100.0	$	195,341		100.0	$	143,895		100.0	$	195,341		100.0

Although the allowance for credit losses is allocated as described in Table ~~15,~~13, the total allowance is available to absorb actual losses in any category of the loan portfolio. However, differences between management’s estimation of probable losses and actual net charge-offs in subsequent periods for any category may necessitate future adjustments to the allowance for credit losses applicable to the category. Management believes the allowance for credit losses is appropriate to absorb expected losses at ~~June~~September 30, 2021.

(unaudited, dollars in thousands)	June 30, 2021		December 31, 2020		$ Change			% Change			September 30, 2021		December 31, 2020		$ Change			% Change
Deposits
Non-interest bearing demand	$	4,409,221	$	4,070,835	$	338,386			8.3		$	4,531,958	$	4,070,835	$	461,123			11.3
Interest bearing demand		3,214,484		2,839,536		374,948			13.2			3,283,444		2,839,536		443,908			15.6
Money market		1,771,686		1,685,927		85,759			5.1			1,765,480		1,685,927		79,553			4.7
Savings deposits		2,438,328		2,214,565		223,763			10.1			2,488,180		2,214,565		273,615			12.4
Certificates of deposit		1,484,536		1,618,510		(133,974	)		(8.3	)		1,354,252		1,618,510		(264,258	)		(16.3	)
Total deposits	$	13,318,255	$	12,429,373	$	888,882			7.2		$	13,423,314	$	12,429,373	$	993,941			8.0

Deposits, which represent Wesbanco’s primary source of funds, are offered in various account forms at various rates through Wesbanco’s ~~212~~206 financial ~~centers, as of June 30, 2021.~~centers. The FDIC insures deposits up to $250,000 per account.

Total deposits increased by ~~$888.9~~$993.9 million or ~~7.2%~~8.0% during the first ~~six~~nine months of 2021. Interest bearing demand deposits, savings deposits, non-interest bearing demand deposits, ~~savings deposits,~~ and money market deposits increased ~~13.2%~~15.6%, ~~10.1%~~12.4%, ~~8.3%~~11.3%, and ~~5.1%~~4.7%, respectively. The growth in transaction-based accounts is primarily attributable toindividual and family stimulus payments, as well as deposits from small businesses obtaining loans from the PPP program,, focused retail and business strategies to obtain more account relationships and customers’ overall ~~preference~~preferences for shorter-term maturities. Deposit balances were also ~~somewhat~~ impacted by bonus and royalty payments for Marcellus and Utica shale gas payments from energy companies in Wesbanco’s southwestern Pennsylvania, eastern Ohio and northern West Virginia markets. Money market deposits were influenced through Wesbanco’s participation in the Insured Cash Sweep (ICS®) money market deposit program. ICS® reciprocal balances totaled ~~$617.6~~$647.3 million at ~~June~~September 30, 2021 compared to $513.9 million at December 31, ~~2020, as certain sweep repurchase agreements previously in short-term borrowings were moved to this product.~~2020.

Certificates of deposit decreased ~~$134.0~~$264.3 million from December 31, 2020 to September 30, 2021 due primarily to the effects of an overall corporate strategy designed to increase and remix retail deposit relationships and reduce single-service customers with a focus on overall products that can be offered at a lower cost to Wesbanco. The decline was also impacted by customer run-off of higher cost certificates of deposit from the OLBK ~~acquisition.~~acquisition and customer preferences for transaction account types. Wesbanco does not generally solicit brokered or other deposits out-of-market or over the internet, but does participate in the Certificate of Deposit Account Registry Services (CDARS®) program. CDARS® balances totaled ~~$45.5~~$45.9 million in outstanding balances at ~~June~~September 30, 2021, compared to $42.6 million in total outstanding balances at December 31, 2020. Certificates of deposit greater than $250,000 were approximately ~~$349.8~~$329.6 million at ~~June~~September 30, 2021 compared to $381.7 million at December 31, 2020. Certificates of deposit of $100,000 or more were approximately ~~$762.4~~$701.9 million at ~~June~~September 30, 2021 compared to $843.2 million at December 31, 2020. Certificates of deposit totaling approximately ~~$925.7~~$893.7 million at ~~June~~September 30, 2021 with a cost of ~~0.45%~~0.50% are scheduled to mature within the next 12 months. Wesbanco intends to continue to focus on its core deposit strategies and improving its overall mix of transaction accounts to total deposits. From time to time, the Bank may offer special promotions or match competitor rates on certain certificates of deposit maturities and savings products based on competition, sales strategies, liquidity needs and wholesale borrowing costs.

(unaudited, dollars in thousands)	June 30, 2021		December 31, 2020		$ Change			% Change			September 30, 2021		December 31, 2020		$ Change			% Change
Federal Home Loan Bank Borrowings	$	313,960	$	549,003	$	(235,043	)		(42.8	)	$	208,940	$	549,003	$	(340,063	)		(61.9	)
Other short-term borrowings		135,267		241,950		(106,683	)		(44.1	)		152,546		241,950		(89,404	)		(37.0	)
Subordinated debt and junior subordinated debt		192,571		192,291		280			0.1			167,711		192,291		(24,580	)		(12.8	)
Total	$	641,798	$	983,244	$	(341,446	)		(34.7	)	$	529,197	$	983,244	$	(454,047	)		(46.2	)

While borrowings ~~have historically been~~are a significant source of funding for Wesbanco, they are ~~currently~~ less significant as compared to ~~prior periods.~~total deposits. During the first ~~six~~nine months of 2021, ~~$235.0~~$340.1 million in available liquidity was used for FHLB borrowings maturities and other principal pay-downs with an average cost of ~~2.58%~~2.40%. There were no new FHLB advances during the period.

Other short-term borrowings, which may consist of federal funds purchased, callable repurchase agreements, overnight sweep checking accounts, and borrowings on a revolving line of credit, were ~~$135.3~~$152.5 million at ~~June~~September 30, 2021 compared to $242.0 million at December 31, 2020. The decrease in these borrowings is primarily due to ~~a $115.3~~an $89.4 million decrease in callable repurchase agreements and overnight sweep checking accounts. The decrease in callable repurchase agreements is due to moving certain customer relationships to interest-bearing demand ~~deposits, which was partially offset by an $8.6 million increase in overnight sweep checking accounts.~~deposits. There were no outstanding federal funds purchased at either ~~June~~September 30, 2021 or December 31, 2020.

Subordinated debt and junior subordinated debt balances decreased by $24.6 million or 12.8% from the third quarter of 2020 to the third quarter of 2021. This decrease is due specifically to the early redemption of the Your Community Bank (“YCB”) subordinated debt in the middle of September. In addition, it was previously announced that Wesbanco will be redeeming the $35.0 million OLBK subordinated debt in the fourth quarter of 2021.

Wesbanco renewed a revolving line of credit in August ~~2020,~~2021, which is a senior obligation of the parent company, with another financial institution. This line of credit, which accrues interest at an adjusted LIBOR rate, provides for aggregate unsecured borrowings of up to $30.0 million. There were no outstanding balances at either ~~June~~September 30, 2021 or December 31, 2020.

Wesbanco enters into financial instruments with off-balance sheet risk in the normal course of business to meet the financing needs of its customers. These financial instruments include commitments to extend credit, letters of credit, loans approved but not closed, overdraft limits and contingent obligations to purchase loans funded by other entities. Since many of these commitments expire unused or partially used, these commitments may not reflect future cash requirements. Please refer to Note 10, “Commitments and Contingent Liabilities,” of the Consolidated Financial Statements and the “Loans and Credit Risk” section of this MD&A for additional information.

The allowance for credit losses includes an allowance for unfunded loan commitments. The allowance for credit losses represents the lifetime expected losses for all loans and unfunded loan commitments at the initial recognition date. The allowance incorporates forward-looking information and applies a reversion methodology beyond the reasonable and supportable forecast. The allowance is increased by a provision charged to operating expense and reduced by charge-offs, net of recoveries, which also includes any necessary adjustments to the reserve for unfunded loan commitments, and such reserve is accounted for in other liabilities. Management evaluates the appropriateness of the allowance at least quarterly. This evaluation is inherently subjective as it requires material estimates that may be susceptible to significant change from period to period.

During the first quarter of 2020, Wesbanco extended its contract with its existing core service provider for an additional seven years, which includes upgraded and enhanced technological services. The new contract also includes additional products and services, which were previously obtained from various other third-party service providers. It is currently anticipated that such core services will be converted in the third quarter of 2021, and that one-time charges from various contract terminations will be accounted for as of the date of the termination of any such associated contract. In addition to upgrading and enhancing technology, reflecting the current operating environment and increased utilization of digital services, Wesbanco announced, on August 27, 2020, a plan to accelerate its financial center optimization strategy. The plan consolidated a total of 30 locations and converted two others to drive-up only locations across Indiana, Kentucky, Ohio, Pennsylvania, West Virginia and Maryland. Three locations closed in 2020, 21 closed in January 2021 and six closed in July 2021. Gross cost savings of approximately $6.0 to $6.5 million was phased-in during the first half of 2021, with approximately half of the gross cost savings reinvested in enhanced customer-facing technologies and digital services. Staff at the locations that were consolidated were permitted to fill certain open positions at other nearby financial centers, somewhat reducing expected cost savings. Wesbanco incurred $0.8 million in restructuring charges in the first half of 2021 associated with the closures. The Company will continue to review other branch locations for potential closure in the future.

Shareholders' equity ~~increased $24.1~~decreased $32.8 million or ~~0.9%~~1.2% from $2.8 billion at December 31, 2020. The ~~increase~~decrease resulted ~~primarily~~ from ~~net income during the current six-month period of $143.7 million, which was partially offset by an $18.8 million other comprehensive income loss,~~ the repurchase of common shares ~~and restricted stock activity~~ totaling ~~$56.7~~$128.0 million, ~~and~~ the declaration of common and preferred shareholder dividends totaling ~~$44.3~~$65.1 million and ~~$5.1~~$7.6 million, respectively, and a $26.9 million other comprehensive loss for the ~~six~~nine months ended ~~June~~September 30, ~~2021.~~2021 exceeding net income during the current nine-month period of $188.1 million. Wesbanco also increased its quarterly dividend rate $0.01 per quarter to $0.33 per share in February, representing a 3.1% increase over the prior quarterly rate and a cumulative 136% increase since 2010.

Wesbanco purchased ~~1,478,882~~3,643,656 shares of its common stock on the open market at a total cost of ~~$55.6~~$128.0 million, or ~~$37.61~~$35.13 per share during the ~~six-month~~nine-month period ended ~~June~~September 30, 2021 under ~~its~~ current share repurchase ~~plans.~~authorizations. The Board of Directors approved an additional stock repurchase plan for the purchase of up to 3.2 million shares on August 26, 2021, which was in addition to prior plans that were utilized during the quarter. At ~~June~~September 30, 2021, the remaining shares authorized to be purchased under the ~~two plans~~last approved repurchase plan totaled ~~1,899,216~~2,960,801 shares. ~~Under a 10b5-1 plan, which allows the Company to repurchase shares during a trading blackout, an additional 556,724 shares were repurchased in July.~~

In February 2021, Wesbanco granted 12,000 Total Shareholder Return Plan (“TSR”) shares for the performance period beginning January 1, 2021 and ending December 31, 2023 to certain executives. The award is determined at the end of the three-year period if the TSR of Wesbanco common stock is equal to or greater than the 50^th percentile of the TSR of the peer group. The number of shares to be earned by the participant shall be 200% of the grant-date award if the TSR of Wesbanco common stock is equal to or greater than the 75^th percentile of the TSR of the peer group. Upon achieving the market-based metric, shares determined to be earned by the participant become time-based and vest in three equal annual installments.

On May 19, 2021, Wesbanco granted 147,200 stock options to ~~select~~selected officers at an exercise price of $38.78. These options are service-based and vest 50% at May 19, 2022 and 50% at December 31, 2022. On the same date, Wesbanco issued 122,656 shares of time-based restricted stock to ~~select~~selected officers and directors and 17,571 shares of performance-based restricted stock to ~~select~~selected officers. The time-based restricted shares are service-based and cliff-vest 36 months from the date of grant. The performance-based restricted shares have a three-year performance period beginning on January 1, 2022, based on Wesbanco’s return on average assets and return on average tangible common equity measured for each year, compared to a national set of peer financial institutions.

~~In addition, on May 19, 2021, Wesbanco issued 3,870 shares to directors. These time-based restricted shares are service-based and cliff-vest 36 months from the date of the grant.~~ On June 24, 2021, Wesbanco issued an additional 6,165 shares of time-based restricted stock to directors. These time-based restricted shares are service-based and cliff-vest 36 months from the date of grant.

Regulatory guidelines require bank holding companies and commercial banks to maintain certain minimum capital ratios and define companies as “well capitalized” that sufficiently exceed the minimum ratios. At ~~June~~September 30, 2021, regulatory capital levels for both the Bank and Wesbanco were substantially greater than the minimum amounts needed to be considered “well capitalized” under the regulations. There are various legal limitations under federal and state laws that limit the payment of dividends from the Bank to Wesbanco. As of ~~June~~September 30, 2021, under FDIC regulations, Wesbanco could receive, without prior regulatory approval, a dividend of approximately ~~$259.9~~$253.7 million from the Bank. Wesbanco expects to continue to improve its consolidated and Bank capital ratios as necessary over time, to fund organic growth and acquisitions, primarily from retaining a majority of its earnings.

On March 26, 2020, regulators issued interim financial rule (“IFR”) “Regulatory Capital Rule: Revised Transition of the Current Expected Losses Methodology for Allowances” in response to the disrupted economic activity from the spread of COVID-19. The IFR provides financial institutions that adopt CECL during 2020 with the option to delay for two years the estimated impact of CECL on regulatory capital, followed by a three-year transition period to phase out the aggregate amount of the capital benefit provided by the initial two-year delay (“~~five year~~five-year transition”). Wesbanco adopted CECL effective January 1, 2020 and elected to implement the ~~five year~~five-year transition. Regulatory capital levels without the capital benefit at ~~June~~September 30, 2021 for both the Bank and Wesbanco would have continued to be greater than the amounts needed to be considered “well

capitalized”, as the capital benefit approximated 25 to 40 basis points for three of the four regulatory ratios, while total risk-based capital would have been slightly higher without the transition.

The following table summarizes risk-based capital amounts and ratios for Wesbanco and the Bank for the periods indicated:

							June 30, 2021							December 31, 2020													September 30, 2021							December 31, 2020
	Minimum			Well-								Minimum							Minimum		Minimum			Well-								Minimum							Minimum
(unaudited, dollars in thousands)	Value⁽¹⁾			Capitalized⁽²⁾			Amount		Ratio			Amount⁽¹⁾		Amount		Ratio			Amount⁽¹⁾		Value⁽¹⁾			Capitalized⁽²⁾			Amount		Ratio			Amount⁽¹⁾		Amount		Ratio			Amount⁽¹⁾
Wesbanco, Inc.
Tier 1 leverage		4.00	%		5.00	%	$	1,654,297		10.40	%	$	636,447	$	1,617,413		10.51	%	$	510,306		4.00	%		5.00	%	$	1,607,960		10.10	%	$	636,839	$	1,617,413		10.51	%	$	510,306
Common equity Tier 1		4.50	%		6.50	%		1,509,813		13.79	%		492,550		1,472,929		13.40	%		494,529		4.50	%		6.50	%		1,463,476		12.91	%		510,274		1,472,929		13.40	%		494,529
Tier 1 capital to risk-weighted assets		6.00	%		8.00	%		1,654,297		15.11	%		656,733		1,617,413		14.72	%		659,372		6.00	%		8.00	%		1,607,960		14.18	%		680,366		1,617,413		14.72	%		659,372
Total capital to risk-weighted assets		8.00	%		10.00	%		1,931,562		17.65	%		875,645		1,931,414		17.58	%		879,162		8.00	%		10.00	%		1,856,275		16.38	%		907,154		1,931,414		17.58	%		879,162
Wesbanco Bank, Inc.
Tier 1 leverage		4.00	%		5.00	%	$	1,604,581		10.10	%	$	635,497	$	1,536,609		10.00	%	$	614,792		4.00	%		5.00	%	$	1,605,464		10.10	%	$	635,854	$	1,536,609		10.00	%	$	614,792
Common equity Tier 1		4.50	%		6.50	%		1,604,581		14.71	%		490,750		1,536,609		14.04	%		492,549		4.50	%		6.50	%		1,605,464		14.21	%		506,792		1,536,609		14.04	%		492,549
Tier 1 capital to risk-weighted assets		6.00	%		8.00	%		1,604,581		14.71	%		654,333		1,536,609		14.04	%		656,732		6.00	%		8.00	%		1,605,464		14.21	%		675,723		1,536,609		14.04	%		656,732
Total capital to risk-weighted assets		8.00	%		10.00	%		1,716,845		15.74	%		872,444		1,685,610		15.40	%		875,643		8.00	%		10.00	%		1,695,778		15.01	%		900,964		1,685,610		15.40	%		875,643

Liquidity is defined as a financial institution’s capacity to meet its cash and collateral obligations at a reasonable cost. Liquidity risk is the risk that an institution’s financial condition or overall safety and soundness is adversely affected by an inability, or perceived inability, to meet its obligations. An institution’s obligations, and the funding sources to meet them, depend significantly on its business mix, balance sheet structure, and the cash flows of its on- and off-balance sheet obligations. Institutions confront various internal and external situations that can give rise to increased liquidity risk including funding mismatches, market constraints on funding sources, contingent liquidity events, changes in economic conditions, and exposure to credit, market, operation, legal and reputation risk. Wesbanco actively manages liquidity risk through its ability to provide adequate funds to meet changes in loan demand, unexpected outflows in deposits and other borrowings as well as to take advantage of market opportunities and meet operating cash needs. This is accomplished by maintaining liquid assets in the form of securities, sufficient borrowing capacity and a stable core deposit base. Liquidity is centrally monitored by Wesbanco’s Asset/Liability Committee (“ALCO”).

Wesbanco determines the degree of required liquidity by the relationship of total holdings of liquid assets to the possible need for funds to meet unexpected deposit losses and/or loan demands. The ability to quickly convert assets to cash at a minimal loss is a primary function of Wesbanco’s investment portfolio management. Wesbanco believes its cash flow from the loan portfolio, the investment portfolio, and other sources, adequately meet its liquidity requirements. Wesbanco’s net loans to assets ratio was ~~60.2%~~57.9% at ~~June~~September 30, 2021 and deposit balances funded ~~78.5%~~79.5% of assets.

The following table lists the sources of liquidity from assets at ~~June~~September 30, 2021 expected within the next year:

(unaudited, in thousands)
Cash and cash equivalents	$	846,304	$	1,121,116
Securities with a maturity date within the next year and callable securities		236,001		239,028
Projected payments and prepayments on mortgage-backed securities and collateralized mortgage obligations ⁽¹⁾		720,861		693,052
Loans held for sale		41,461		32,308
Accruing loans scheduled to mature		1,379,672		1,160,888
Normal loan repayments		1,715,040		2,218,268
Total sources of liquidity expected within the next year	$	4,939,339	$	5,464,660

Deposit flows are another principal factor affecting overall Wesbanco liquidity. Deposits totaled ~~$13.3~~$13.4 billion at ~~June~~September 30, 2021. Deposit flows are impacted by current interest rates, products and rates offered by Wesbanco versus various forms of competition, as well as customer behavior. Certificates of deposit scheduled to mature within one year totaled ~~$925.7~~$893.7 million at ~~June~~September 30, 2021, which includes jumbo regular certificates of deposit totaling ~~$491.5~~$448.1 million with a weighted-average cost of ~~0.73%~~0.59%, and jumbo CDARS^® deposits of ~~$37.4~~$8.8 million with a weighted-average cost of ~~0.47%~~1.79%.

Wesbanco maintains a line of credit with the FHLB as an additional funding source. Available credit with the FHLB approximated ~~$4.2~~$4.0 billion and $3.6 billion at ~~June~~September 30, 2021 and December 31, 2020, respectively. The FHLB requires securities to be specifically pledged to the FHLB and maintained in a FHLB-approved custodial arrangement if the member wishes to include such securities in the maximum borrowing capacity calculation. Wesbanco has elected not to specifically pledge to the FHLB otherwise unpledged securities. At ~~June~~September 30, 2021, the Bank had unpledged available-for-sale securities with an amortized cost of ~~$1.2~~$1.0 billion, or ~~40.8%~~35.6% of the total available-for-sale portfolio. A portion of these securities could be sold for additional liquidity, or such securities could be pledged to secure additional FHLB borrowings. A significant portion of the portfolio is pledged to public deposit customers, as public deposit balances have increased significantly through the several acquisitions made since 2015, to a total of ~~$1.5~~$1.6 billion at ~~June~~September 30, 2021. Wesbanco’s held-to-maturity portfolio currently contains ~~$735.2~~$793.2 million of unpledged securities. Most of these securities are tax-exempt municipal securities, which can only be pledged in limited circumstances. Generally, these securities cannot be sold without tainting the remainder of the held-to-maturity portfolio. If tainting occurs, all remaining securities with the held-to-maturity designation would be required to be reclassified as available-for-sale, and the held-to-maturity designation would not be available to Wesbanco for a period of time.

Wesbanco participates in the Federal Reserve Bank’s Borrower-in-Custody Program (“BIC”) whereby Wesbanco pledges certain consumer loans as collateral for borrowings. ~~At June~~Wesbanco did not have any BIC borrowings outstanding at September 30, ~~2021, Wesbanco had a BIC line of credit totaling $162.1 million, none of which was outstanding.~~2021. Alternative funding sources may include the utilization of existing overnight lines of credit with third party banks totaling $275.0 million, none of which was outstanding at ~~June~~September 30, 2021, along with seeking other lines of credit, borrowings under repurchase agreement lines, increasing deposit rates to attract additional funds, accessing brokered deposits, or selling securities available-for-sale or certain types of loans.

Other short-term borrowings of ~~$135.3~~$152.5 million at ~~June~~September 30, 2021 consisted of callable repurchase agreements and overnight sweep checking accounts for large commercial customers. Other short-term borrowings may also include federal funds purchased. There has been a decrease ~~of $42.2 million~~ in ~~the~~ average ~~deposit~~ balances of overnight sweep checking accounts during the first ~~three~~nine months of 2021, primarily from the movement of overnight sweep checking accounts to ~~deposits.~~transaction account deposits to reduce pledging. The overnight sweep checking accounts require U.S. Government securities to be pledged equal to or greater than the average deposit balance in the related customer accounts.

The principal sources of parent company liquidity are dividends from the Bank, ~~$196.9~~$148.2 million in cash on hand, and a $30.0 million revolving line of credit with another bank, which did not have an outstanding balance at ~~June~~September 30, 2021. Wesbanco is in compliance with all applicable loan covenants. There are various legal limitations under federal and state laws that limit the payment of dividends from the Bank to the parent company. As of ~~June~~September 30, 2021, under FDIC and State of West Virginia regulations, Wesbanco could receive, without prior regulatory approval, dividends of approximately ~~$259.9~~$253.7 million from the Bank. Management believes these are appropriate levels of cash for the parent company given the current environment. Management continuously monitors the adequacy of parent company cash levels and sources of liquidity through the use of metrics that relate current cash levels to historical and forecasted cash inflows and outflows.

Wesbanco had outstanding commitments to extend credit in the ordinary course of business approximating ~~$3.2~~$3.7 billion and $3.0 billion at ~~June~~September 30, 2021 and December 31, 2020, respectively. On a historical basis, only a portion of these commitments will result in an outflow of funds. Please refer to Note ~~12,~~10, “Commitments and Contingent Liabilities” of the Consolidated Financial Statements and the “Loans and Credit Risk” section of this MD&A for additional information.

Federal financial regulatory agencies have previously issued guidance to provide for sound practices for managing funding and liquidity risk and strengthening liquidity risk management practices. Wesbanco maintains a comprehensive management process for identifying, measuring, monitoring, and controlling liquidity risk, which is fully integrated into its risk management process. Management believes Wesbanco has sufficient current liquidity to meet current obligations to borrowers, depositors and others and thatWesbanco’s current liquidity risk management policies and procedures, as periodically reviewed and adjusted, adequately address this guidance.

The London Interbank Offered Rate (“LIBOR”) is a widely used short-term reference interest rate benchmark for variable rate loans and securities, borrowings, and interest rate hedge/swap transactions. In July of 2017, the U.K. Financial Conduct Authority (“FCA”) announced the discontinuation of LIBOR after certain banks provided purported interest rate figures which did not truly reflect the rate at which they could borrow. In addition to FCA, as early as 2014, financial institution regulators and the Federal Financial Institutions Examination Council (“FFIEC”) began to work to develop a uniform approach to the phase-out of LIBOR because the continued reliance on LIBOR could present systematic risk to financial institutions. The Board of Governors of the Federal Reserve System and the Federal Reserve Bank of New York convened the Alternative Reference Rates Committee (“AARC”) to identify alternative reference rates to LIBOR. The AARC released consultations on contractual fallback language to prepare for the transition away for LIBOR and on June 22, 2017, identified the Secured Overnight Financing Rate (“SOFR”) as the recommended alternative to LIBOR.

On July 1, 2020, the FFIEC issued a Joint Statement on Managing the LIBOR Transition to further explain that new financial contracts should either utilize a reference rate other than LIBOR or have robust fallback language that defines an alternative reference rate after LIBOR’s discontinuation. The FFIEC statement encouraged supervised financial institutions to continue their efforts to prepare for the change and address the risks associated with the LIBOR transition.

On November 6, 2020, the Board of Governors of the Federal Reserve System, the Office of the Comptroller of the Currency, and the Federal Deposit Insurance Corporation (collectively, the “Agencies”) issued a statement providing that a financial institution may use any reference rate for its loans that the financial institution determines to be appropriate for its funding model and customer needs.

Thereafter, on November 30, 2020, the Agencies issued an additional joint statement encouraging financial institutions to continue to transition away from LIBOR as soon as practicable, but no later than December 31, 2021. Given the risks associated with the use of LIBOR, the Agencies stated that entering into new contracts that use LIBOR as a reference rate after December 31, 2021, would create safety and soundness risks.

On March 5, 2021, the U.K. FCA and Intercontinental Exchange (“ICE”) Benchmark Administration announced that the publication of the overnight, as well as, the one, three, six, and twelve month LIBOR rates will continue to be published through June 30, 2023, which will provide additional time to wind down or renegotiate existing contracts that reference LIBOR.

On October 20, 2021, the Agencies with the Consumer Financial Protection Bureau, National Credit Union Administration, and State Bank and Credit Union Regulators, issued an additional Joint Statement on Managing the LIBOR Transition to once again emphasize the expectation that supervised institutions with LIBOR exposure continue to progress toward an orderly transition away from LIBOR. The statement confirmed that entering into new contracts, including derivatives that use LIBOR as a reference rate after December 31, 2021, would create safety and soundness risks, including litigation, operational, and consumer protection risks.

As early as 2018, in anticipation of the potential discontinuance of LIBOR, Wesbanco established a LIBOR transition committee to effectively manage the Company’s transition away from LIBOR in two phases. The first phase included adding additional fallback language to loan documents to allow Wesbanco to replace LIBOR with an equivalent rate index plus the margin to ensure the resulting interest rate is the same as it previously was using LIBOR. Also, as part of the first phase, Wesbanco began quoting to the Treasury Rate published by the Federal Reserve Board instead of the ICE LIBOR Swap Index (which is tied to LIBOR) when repricing certain term loans and originating new loans. The second phase consists of working to continue to transition existing adjustable-rate loans that fluctuate monthly or periodically that are tied to LIBOR or the ICE LIBOR Swap Index. Wesbanco is tracking the dollar amount and number of loans tied to LIBOR or the ICE LIBOR Swap Index, monitoring current industry trends, and working with legal counsel to ensure the smooth transition away from LIBOR. As of September 30, 2021, Wesbanco had a total of $1.9 billion in loans tied to either LIBOR or the ICE LIBOR Swap index, of which $1.5 billion have a maturity date after June 30, 2023. As referenced above, the U.K. FCA and ICE Benchmark Administration has extended the date of publication of certain tenors of LIBOR through June 30, 2023, giving existing LIBOR based contracts time to mature. However, in compliance with and based upon the Agencies Joint Statements referenced above, Wesbanco will not be offering LIBOR for new contracts after December 31, 2021. Accordingly, Wesbanco has initially chosen the One Month Term Secured Overnight Financing Rate (“1M Term SOFR”), which is published by the Chicago Mercantile Exchange (“CME”), as an alternative replacement rate for LIBOR. Wesbanco may also continue to utilize the Wall Street Journal Prime Rate, the Treasury Rates, and other indexes as part of its lending program. System and process updates are being made to enable the use of the 1M Term SOFR for new loan production by the end of 2021 in accordance with regulatory guidelines. At a date in the future, prior to the cessation of the publication of the one month LIBOR, Wesbanco will transition all remaining LIBOR based loans to the replacement index after notification to the impacted borrowers.

With respect to its back-to-back swap program, Wesbanco worked with its swap counterparty customers to institute and accept the International Swaps and Derivatives Association 2020 Interbank Offered Rate Fallbacks Protocol ("ISDA 2020 IBOR Protocol") to address LIBOR cessation in swap transactions. Moreover, Wesbanco has initially chosen 1M Term SOFR as its replacement index for new loans in the bank’s back-to-back swap program. The LIBOR transition committee, in consultation with market participants, expects the market for Term SOFR derivatives to be actively engaged prior to the end of 2021, allowing the program to meet the Agencies timeline of December 31, 2021.

The disclosures set forth in this item are qualified by the section captioned “Forward-Looking Statements” included in Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations of this report.

The primary objective of Wesbanco’s Asset/Liability Committee (“ALCO”) is to maximize net interest income within established policy parameters. This objective is accomplished through the management of balance sheet composition, market risk exposures arising from changing economic conditions and liquidity risk.

Market risk is defined as the risk of loss due to adverse changes in the fair value of financial instruments resulting from fluctuations in interest rates and bond prices. Management considers interest rate risk to be Wesbanco’s most significant market risk. Interest rate risk is the exposure to adverse changes in net interest income due to changes in interest rates. The consistency of Wesbanco’s net interest income is largely dependent on effective management of interest rate risk. As interest rates change in the market, rates earned on interest rate-sensitive assets and rates paid on interest rate-sensitive liabilities do not necessarily move concurrently. Differing rate sensitivities may arise because fixed rate assets and liabilities may not have the same maturities, or because variable rate assets and liabilities differ in the timing and/or the percentage of rate changes.

Wesbanco’s ALCO is an executive management committee with Board representation, responsible for monitoring and managing interest rate risk within approved policy limits, utilizing earnings sensitivity simulation and economic value-at-risk models. These models are highly dependent on various assumptions, which change regularly as the balance sheet and market interest rates change. The key assumptions and strategies employed are analyzed, reviewed and documented at least quarterly by the ALCO.

The earnings sensitivity simulation model projects changes in net interest income resulting from the effects of changes in interest rates. Forecasting changes in net interest income requires management to make certain assumptions regarding loan and security prepayment rates, call dates, changes to deposit product betas and non-maturity deposit decay rates, which may not necessarily reflect the manner in which actual cash flows, yields, and costs respond to changes in market interest rates. Assumptions are based on historical experience, current market rates and economic forecasts, and are internally back-tested and periodically reviewed by a third-party consultant. The net interest income sensitivity results presented in Table 1, “Net Interest Income Sensitivity,” assumes that the balance sheet composition of interest sensitive assets and liabilities existing at the end of the period remains constant over the period being measured and also assumes that a particular change in interest rates is reflected uniformly across the yield curve, regardless of the duration of the maturity or re-pricing of specific assets and liabilities. Since the assumptions used in the model relative to changes in interest rates are uncertain, the simulation analysis may not be indicative of actual results. In addition, this analysis does not consider actions that management might employ in response to changes in interest rates, as well as changes in earning asset and costing liability balances.

Interest rate risk policy limits are determined by measuring the anticipated change in net interest income over a twelve-month period, assuming immediate and sustained market interest rate increases and decreases of 100 - 300 basis points across the entire yield curve, as compared to a stable rate environment or base model. Wesbanco’s current policy limits this exposure for the noted interest rate changes to a reduction of between 7.5% - 15%, or less, of net interest income from the stable rate base model over a twelve-month period. The table below indicates Wesbanco’s interest rate sensitivity at ~~June~~September 30, 2021 and December 31, 2020, assuming the above-noted interest rate increases, as compared to a base model. In the current interest rate environment, particularly for short-term rates, the 100 – 300 basis points decreasing changes for ~~June~~September 30, 2021 and December 31, 2020 are not shown due to the unrealistic and/or negative yield nature of the results.

Immediate Change in	Percentage Change in			Percentage Change in
Interest Rates	Net Interest Income from Base over One Year		ALCO	Net Interest Income from Base over One Year		ALCO
(basis points)	June 30, 2021	December 31, 2020	Guidelines	September 30, 2021	December 31, 2020	Guidelines
+300	13.0%	15.3%	(15.0%)	15.9%	15.3%	(15.0%)
+200	8.8%	10.3%	(10.0%)	10.7%	10.3%	(10.0%)
+100	4.8%	5.5%	(7.5%)	5.7%	5.5%	(7.5%)

Adjustments to relative sensitivities are due to the impact of the current lower rate and yield curve environment on base case net interest income and the related calculation of parallel rate shock changes in rising and falling rate scenarios. Additional differences typically result from changes in the various earning assets and costing liabilities mix and growth rates, as well as adjustments for various modeling assumptions. Generally, deposit betas utilized in modeling are estimated at more conservative percentages for both up and down rate scenarios than has been the Bank’s historical experience, as a result of both competitive factors in our markets and as public funds and institutional contract terms are renewed. Deposit betas, decay rates and loan prepayment speeds are adjusted periodically in our models for non-maturity deposits and loans. Indicated model asset sensitivity in rising rate scenarios may be less than anticipated due to slower prepayment speeds, rate floors, below forecast loan yields, spread compression between new asset yields and funding costs, mortgage-related extension risk and other factors. In a decreasing rate environment, asset sensitivity may have greater impact on the margin than currently modeled as prepayment speeds increase, customers refinance or request rate reductions on existing loans, estimated deposit betas do not perform as modeled, or for other reasons.

In addition to the aforementioned parallel rate shock earnings sensitivity simulation model, the ALCO also reviews a “dynamic” forecast scenario to project net interest income over a rolling two-year time period. This forecast is updated at least quarterly, incorporating revisions and updated assumptions into the model for estimated loan and deposit growth, expected balance sheet re-mixing strategies, changes in forecasted rates for various maturities, competitive market spreads for various products and other assumptions. Such modeling is directionally consistent with typical parallel rate shock scenarios, and it assists in predicting changes in forecasted outcomes and potential adjustments to management plans to assist in achieving earnings goals.

Wesbanco also periodically measures the economic value of equity (“EVE”), which is defined as the market value of tangible equity in various rate scenarios. Generally, changes in the economic value of equity relate to changes in various assets and liabilities, changes in the yield curve, as well as changes in loan prepayment speeds and deposit decay rates. The following table presents these results and Wesbanco’s policy limits as of ~~June~~September 30, 2021 and December 31, 2020. Changes in EVE sensitivity since year-end 2020 relate to the increase in market interest rates ~~particularly in the latter half of the first quarter of 2021,~~ and their impact upon the fair values of earning assets and costing ~~liabilities:~~liabilities.

Immediate Change in	Percentage Change in			Percentage Change in
Interest Rates	Economic Value of Equity from Base over One Year		ALCO	Economic Value of Equity from Base over One Year		ALCO
(basis points)	June 30, 2021	December 31, 2020	Guidelines	September 30, 2021	December 31, 2020	Guidelines
+300	4.5%	13.4%	(30.0%)	5.0%	13.4%	(30.0%)
+200	3.5%	10.6%	(20.0%)	3.7%	10.6%	(20.0%)
+100	3.6%	7.1%	(10.0%)	3.6%	7.1%	(10.0%)

The Bank has significant additional borrowing capacity with the FHLB of Pittsburgh, the Federal Reserve Bank of Cleveland and various correspondent banks, and may utilize these funding sources or interest rate swap strategies as necessary to lengthen liabilities, offset mismatches in various asset maturities and manage liquidity. CDARS® and ICS® deposits also may be utilized for similar purposes for certain customers seeking higher-yielding instruments or maintaining deposit levels below FDIC insurance limits. Significant balance sheet strategies to assist in managing the net interest margin in the current interest rate environment include:

Management is aware of the significant effect that inflation or deflation has upon interest rates and ultimately upon financial performance. Wesbanco’s ability to cope with inflation or deflation is best determined by analyzing its capability to respond to changing market interest rates, as well as its ability to manage the various elements of non-interest income and expense during periods of increasing or decreasing inflation or deflation. Wesbanco monitors the level and mix of interest-rate sensitive assets and liabilities through ALCO in order to reduce the impact of inflation or deflation on net interest income. Management also controls the effects of inflation or deflation by conducting periodic reviews of the prices, costs and terms of its various products and services, as well as competitive factors, by approving new products and services or adjusting the terms and availability of existing products and services.

~~In anticipation~~ Over the last few months of the ~~potential discontinuance~~third quarter, inflation has been trending higher and has impacted the cost of the London Interbank Offered Rate (LIBOR), which was initially slated to occur at the end of 2021, Wesbanco has created a LIBOR transition committee, which has broken the Company’s transition efforts into two phases. The first phase included adding additional language to new loans that allows Wesbanco to replace LIBOR with an equivalent rate indexlabor and adjust the margin to ensure the resulting interest rate is the same as it previously was using LIBOR. Also included in the first phase was Wesbanco transitioning from the LIBOR swap curve to treasury rates when repricing certain term loanspurchased goods and ~~originating new loans. The second phase is transitioning current variable loans tied to LIBOR or on a LIBOR swap curve.~~services. Wesbanco is ~~tracking~~also monitoring the ~~dollar amount~~potential impact that inflation is having on multifamily properties as proposed rental rate caps and number of loans tied to LIBOR or the LIBOR swap curve, monitoring current industry trends, and engaging its legal counsel to ensure the smooth transition away from LIBOR. The date for the discontinuation of LIBOR has been extended for certain tenors and currencies by its administrator to June 30, 2023, giving existing LIBOR-based contracts time to mature. Although the cessation date has been extended, a joint agency statement on November 30, 2020 indicated that, evencontrols are put in the event of an extension, the agencies would consider the use of LIBOR as a reference rate for new loans after December 31, 2021 as creating safety and soundness risks. As such, Wesbanco is continuing to develop its transition plan to price new loans to a suitable replacement index by the end of 2021.place in areas across Wesbanco’s footprint.

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES— Wesbanco’s Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”) have concluded that Wesbanco’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended), based on their evaluation of these controls and procedures as of the end of the period covered by this Form 10-Q, are effective to ensure that information required to be disclosed by Wesbanco in the reports it files under the Securities Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the SEC and that such information is accumulated and communicated to Wesbanco’s management, including its principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.

LIMITATIONS ON THE EFFECTIVENESS OF CONTROLS— Wesbanco’s management, including the CEO and CFO, does not expect that Wesbanco’s disclosure controls and internal controls will prevent all errors and all fraud. While Wesbanco’s disclosure controls and procedures are designed to provide reasonable assurance of achieving their objective, no control system, no matter how well conceived and operated, can provide absolute assurance that the objectives of the control system are met. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty, and that breakdowns can occur because of simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override of the controls.

CHANGES IN INTERNAL CONTROLS—~~There~~ During the third quarter of 2021, the Company completed the conversion of its legacy core banking system into a new core banking platform. This upgrade included enhancements to the loan and deposit areas, as well as digital banking and the general ledger, among others. As a result of the conversion, there were nocertain changes ~~in Wesbanco’s~~to processes and procedures, which have materially affected, or are reasonably likely to have materially affected, the Company's internal control over financial reporting ~~that occurred during our fiscal quarter ended~~since management's last assessment of the Company's internal control over financial reporting, which was completed as of June 30, ~~2021 as required to be reported by paragraph (d) of Rules 13a-15 and 15d-15 under~~2021.

There have been no other changes in the ~~Securities Exchange Act of 1934,~~Company's internal control over financial reporting during the most recently completed quarter that have materially affected, or are reasonably likely to materially affect, ~~Wesbanco’s~~the Company's internal control over financial reporting.

Wesbanco is involved in various lawsuits, claims, investigations and proceedings, which arise in the ordinary course of business. While any litigation contains an element of uncertainty, Wesbanco does not believe that a material loss related to such proceedings or claims pending or known to be threatened is reasonably possible.

As of ~~June~~September 30, 2021, Wesbanco had ~~two~~one active stock repurchase ~~plans. The first active plan~~plan. It was approved by the Board of Directors on ~~December 19, 2019~~August 26, 2021 for ~~1.7~~3.2 million shares and ~~the second plan was approved on April 22, 2021 for an additional 1.7 million shares. Each~~ provides for shares to be repurchased for general corporate purposes, which may include a subsequent resource for potential acquisitions, shareholder dividend reinvestment and employee benefit plans. The timing, price and quantity of purchases are at the discretion of Wesbanco, and the plan may be discontinued or suspended at any time.

Other repurchases in the ~~second~~third quarter included those for the KSOP and dividend reinvestment plans.

The following table presents the monthly share purchase activity during the quarter ended ~~June~~September 30, 2021:

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

West Virginia		55-0571723
(State of incorporation)		(IRS Employer Identification No.)

1 Bank Plaza, Wheeling, WV		26003
(Address of principal executive offices)		(Zip Code)

Large accelerated filer	☑	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

Period	Total Number of Shares Purchased (1)		Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans (2)		Maximum Number of Shares that May Yet Be Purchased Under the Plans (2)
Balance at March 31, 2021								1,704,457

April 1, 2021 to April 30, 2021		127,098	$	36.54		102,188		3,302,269
May 1, 2021 to May 31, 2021		541,371	$	38.50		540,100		2,762,169
June 1, 2021 to June 30, 2021		865,523	$	37.24		862,953		1,899,216
Total		1,533,992	$	37.63		1,505,241		1,899,216

10.1		Consulting Agreement, dated as of September 1, 2021, by and between Wesbanco, Inc. ~~Incentive Bonus, Option~~ and ~~Restricted Stock Plan, as amended~~Robert H. Young (incorporated by reference to Form 8-K filed by the Registrant with the Securities and Exchange Commission on ~~April 21,~~September 2, 2021).

31.1		Certification of Chief Executive Officer of Periodic Report Pursuant to Rule 13a-15(e) or Rule 15d-15(e).

31.2		Certification of Chief Financial Officer of Periodic Report Pursuant to Rule 13a-15(e) or Rule 15d-15(e).

32.1		Certification Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS		Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document).

101.SCH		Inline XBRL Taxonomy Extension Schema Document

101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase Document

101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase Document

101.LAB		Inline XBRL Taxonomy Extension Label Linkbase Document

101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase Document

104		Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101).

	WESBANCO, INC.

Date: ~~August 5,~~November 8, 2021	/s/ Todd F. Clossin
	Todd F. Clossin
	President and Chief Executive Officer (Principal Executive Officer)

Date: ~~August 5,~~November 8, 2021	/s/ Robert H. Young
	Robert H. Young
	Senior Executive Vice President and Chief Financial Officer
	(Principal Financial Officer)