Prosperity Bancshares, Inc. · NYSE:PB
Prosperity Bancshares — Q1 2021 Earnings Presentation
28 slides from Prosperity Bancshares's earnings presentation, Apr 28, 2021
Slide 1: Investor Presentation First Quarter 2021
Investor Presentation First Quarter 2021
Slide 2: Safe Harbor Statement
“Safe Harbor” Statement Under the Private Securities Litigation Reform Act of 1995 “Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995: This presentation contains forward-looking statements within the meaning of the federal securities laws, including Section 27A of the
Slide 3: 2021 First Quarter Highlights
2021 First Quarter Highlights • Net income of $133.3 million and earnings per share (diluted) of $1.44 for three months ended March 31, 2021 • Assets of $35.6 billion, total loans of $19.6 billion, and deposits of $28.8 billion at March 31, 2021 • Common equity tier 1 ratio of 14.60% and leverage ra
Slide 4: Strong Presence in Texas and Oklahoma
Strong Presence in Texas and Oklahoma • A Texas-based financial holding company with $35.6 billion in total assets • Ranked #3 in deposit market share in Texas (1) Oklahoma INTERSTATE 44 • Texas and Oklahoma continue to benefit from strong Tulsa INTERSTATE 35 economies, and are home to 55 Fortune 50
Slide 5: Balance Sheet Summary
Balance Sheet Summary 0,000 ,000 Data as of 03/31/2021 Total Loans $19.6 Bn ,000 ,000 Deposits $28.8 Bn Assets $35.6 Bn 0,000 10 Year CAGR (1) ,000 ,000 Loans 19.2% Deposits 13.9% ,000 Assets 13.6% 0,000 ,000 1 ,000 ,000 10,000 1,000 ,000 0 0 010 011 01 01 01 01 01 01 01 01 0 0 1 0 1 1 Assets Deposi
Slide 6: Net Income
Net Income 00 0 10 Year CAGR:(1) 15.3% 00 0 5 Year CAGR:(2) 13.0% 00 0 00 0 00 0 100 0 00 (3) 010 011 01 01 01 01 01 01 01 01 0 0 1 0 1 1 Note: Net income includes the following ($ in thousands) Provision for Credit $13,585 $5,200 $6,100 $17,240 $18,275 $7,560 $24,000 $14,325 $16,350 $4,300 $20,000
Slide 7: Earnings Per Share
Earnings Per Share 00 10 Year EPS CAGR:(1) 7.6% 00 5 Year EPS CAGR:(2) 6.8% 00 00 00 1 00 0 00 (3) 010 011 01 01 01 01 01 01 01 01 0 0 1 0 1 1 Note: Net income includes the following ($ in thousands) Provision for Credit $13,585 $5,200 $6,100 $17,240 $18,275 $7,560 $24,000 $14,325 $16,350 $4,300 $20
Slide 8: Net Interest Margin
Net Interest Margin 0 00 0 00 0 010 011 01 01 01 01 01 01 01 01 0 0 1 0 1 1 Net Interest Margin (Tax Equivalent) Net Interest Margin (Excluding Purchase Accounting Adjustments) 8 Source: Company Documents
Slide 9: Acquisitions & Efficiency Ratio
Acquisitions & Efficiency Ratio 0,000 , 00 ,0 ,000 ,1 1, 0 0,000 00 ,000 , 1 , , 1, 0 ,0 1 , 0 0,000 1 , 00 1 ,000 , , 10,000 0 ,000 00 0 0 (3) 010 011 01 01 01 01 01 01 01 01 0 0 1 0 1 1 % of Assets Acquired 1.6% 0.0% 23.7% 20.9% 11.2% 0.0% 2.5% 0.0% 0.0% 31.3% 0.0% 0.0% 0.0% Total Assets Excluding
Slide 10: Return on Average Tangible Common Equity
Return on Average Tangible Common Equity 0 00 ,000 0 00 , 0 0 00 1, 00 10 00 0 0 00 0 (2) (1) (1) 010 011 01 01 01 01 01 01 01 01 0 0 1 0 1 1 ROATCE Tangible Common Equity (1) Interim periods shown on an annualized basis 10 (2) Includes NOL tax benefit of $20.145 million related to the CARES Act
Slide 11: Return on Average Assets
Return on Average Assets 00 1 1 0 1 1 00 0 (2) (1) (1) 010 011 01 01 01 01 01 01 01 01 0 0 1 0 1 1 (1) Interim periods shown on an annualized basis 11 (2) Includes NOL tax benefit of $20.145 million related to the CARES Act
Slide 12: Deposit Composition
Deposit Composition As of March 31, 2021 ($ in millions) C s ther ime $mm Cost (%)(1) 10 oninterest Noninterest-Bearing Demand $9,820 0.00% Bearing emand Interest-Bearing Demand $6,159 0.39% oney arket 1 Money Market & Savings $9,798 0.25% Savings 1 CDs & Other Time $2,986 0.76% nterest Bearing Tota
Slide 13: Loan Growth
Loan Growth $20,247 $19,639 $18,845 $19,127 Loans (Excluding Warehouse Purchase Program) Loan / Deposit Ratio (Excluding WPP) Warehouse Purchase Program (WPP) Loan / Deposit Ratio (Including WPP) 13 Source: Company Documents
Slide 14: Loan Portfolio Overview
Loan Portfolio Overview As of March 31, 2021 ($ in millions) Loan Portfolio by Category & Geography Loans by Rate Structure PPP oans 1,1 arehouse Agriculture , 11 1 Family ( nc Farm) , 10 Home E uity Fixed 1 Floa ng 1 Energy ~2.5yr C 0 Consumer Avg. Life ,10 Construc on 10 ther ,0 Comm E 10 1 , PPP
Slide 15: Loan Portfolio Detail
Loan Portfolio Detail As of March 31, 2021 ($ in millions) Portfolio Commentary Commercial Real Estate Detail ($ in millions) • 30% of commercial real estate is owner occupied Retail $1,377 24% n tr a • CRE and construction loans conservatively Office $1,093 19% underwritten to cost of collateral In
Slide 16: Energy Portfolio Detail
Energy Portfolio Detail As of March 31, 2021 ($ in millions) Energy Detail - Outstanding Balance Portfolio Commentary ($ in millions) • Total energy loan loss reserves of 6.0%, or $30.4 tream million (excluding fair value marks)(1) e er e ba e • $104.1 million, or 20.7% of energy loans, are subject
Slide 17: Changes to Allowance for Credit Losses
Changes to Allowance for Credit Losses ($ in millions) 1.92% ACL to Total 1.89% ACL to Total Loans (1)(2) Loans (1)(2) Allowance for ▪ Net Charge-offs Allowance for Credit Losses ▪ Net increased reserve ▪ $7.1 million related ▪ PCD recoveries ▪ Outstanding Credit Losses to PCD loans balances related
Slide 18: Asset Quality
Asset Quality NPAs / Loans + OREO 00 00 00 00 00 1 00 0 00 00 00 00 010 011 01 01 01 01 01 01 01 01 0 0 1 0 1 1 UBPR Peer Group (1) Prosperity Bank Source: Company Documents & Uniform Bank Performance Report 18 Note: NPAs include loans past due 90 days and still accruing (1) UBPR = Uniform Bank Perf
Slide 19: Asset Quality: Net Charge-Offs / Average Loans
Asset Quality Net Charge-Offs / Average Loans 00 1 0 1 00 0 0 (2) 0 00 ($ in millions) (2) Recoveries Charge-Offs 00 00 00 010 011 01 01 01 01 01 01 01 01 0 0(3) 1 0 1 1 Net 1 1 1 01 1 1 0 (3) 1 0 00 00 00 010 011 01 01 01 01 01 01 01 01 0 0 1 0 1 1 (3) Net PCD (3) 00 00 00 010 011 01 01 01 01 01 01
Slide 20: Securities Portfolio Detail
Securities Portfolio Detail As of March 31, 2021 ($ in millions) States Poli cal Subdivisions $mm ortgage 1 Mortgage-Backed Securities $9,266 Backed Collateralized Mortgage Obligations $677 Securi es Collaterali ed 1 ortgage States & Political Subdivisions $145 bliga ons Total Securities: $10.1Bn Yi
Slide 21: Dividend History
Dividend History (d) (c) (b) (a) (a) 2017 dividend consists of $0.34 per share declared in 1Q 2017, 2Q 2017, 3Q 2017 and $0.36 per share declared in 4Q 2017 (b) 2018 dividend consists of $0.36 per share declared in 1Q 2018, 2Q 2018, 3Q 2018 and $0.41 per share declared in 4Q 2018 21 (c) (d) 2019 div
Slide 22: Total Return Performance
Total Return Performance IPO (November 12, 1998) to March 31, 2021 2,000 , n e te n ro er ty’ on 11/12/98 was worth $1,805,445 1,800 on 3/31/21 1,600 1,400 1,200 1,000 800 600 400 200 0 11/12/98 11/12/00 11/12/02 11/12/04 11/12/06 11/12/08 11/12/10 11/12/12 11/12/14 11/12/16 11/12/18 11/12/20 PB (+1
Slide 23: Presence in Fast-Growing Markets
Presence in Fast-Growing Markets Positioned in Strong Markets Top 10 Fastest Growing MSAs in the U.S. (1) Prosperity 2021 - 2026 • Today, Texas is the 2nd largest Prosperity Deposits Population state in the U.S., and largest in Metropolitan Statistical Area Presence ($mm) Growth Lubbock Lubbock Lubb
Slide 24: Corporate Relocations to Texas
Corporate Relocations to Texas California Aatonomy AccentCare Active Networks AEND Industries, Inc. The Allen Group, Inc. Allied Electronic Recycling ALL-Q-TELL Corp. Corporate Relocations to Texas (2004 – Present) Amazing Magnets Ameriflight LLC Canada Aviat Networks, Inc. Absolute Software (ABT) B
Slide 25: Houston Market Highlights
Houston Market Highlights Market Highlights Houston Franchise • Houston MSA is the 5th largest in the United States by population with approximately 7.2 million residents – Population is expected to grow 7.6% from 2021 to 2026 • As of March 2021, total nonfarm employment fell by 5.5% YoY, compared t
Slide 26: Dallas/Ft. Worth Market Highlights
Dallas/Ft. Worth Market Highlights Market Highlights Dallas / Ft. Worth Franchise • Dallas/Ft. Worth MSA is the 4th largest in the United States by population with over 7.7 million residents – Population is expected to grow 7.5% from 2021 to 2026 • As of March 2021, total nonfarm employment has only
Slide 27: Austin Market Highlights
Austin Market Highlights Market Highlights Austin Franchise Franchise • Ranked #3 place to live in the U.S. in 2020 by U.S. News and World Report, with expected population growth of 8.5% through 2026 • Ranked as the best city in the U.S. for technology professionals INTERSTATE 35 – IT job growth is
Slide 28: Contact Information
Contact Information Corporate Headquarters Investor Contacts Prosperity Bank Plaza David Zalman 4295 San Felipe Chairman & CEO Houston Texas 77027 979-543-2200 david.zalman@prosperitybankusa.com 281-269-7199 Telephone 281-269-7222 Fax Cullen Zalman SVP – Banking & Corporate Activities 281-269-7176 c
Prosperity Bancshares — Q1 2021 Earnings Presentation on 6ix