Wsfs Financial Corporation · NASDAQ:WSFS
Wsfs Financial — Q3 2023 Earnings Presentation
19 slides from Wsfs Financial's earnings presentation, Oct 23, 2023
Slide 1: WSFS Financial Corporation 3Q 2023 Earnings Release Supplement
1 WSFS Financial Corporation 3Q 2023 Earnings Release Supplement October 2023 Exhibit 99.2
Slide 2: Forward Looking Statements & Non-GAAP
2 Forward Looking Statements & Non-GAAP Forward Looking Statements: This presentation contains estimates, predictions, opinions, projections and other "forward-looking statements" as that phrase is defined in the Private Securities Litigation Reform Act of 1995. Such statements include, without limi
Slide 3: 3Q 2023 Financial Highlights
3 3Q 2023 Financial Highlights 3Q 2023 Highlights: • Net loan growth of $328mm or 3% from prior quarter • Customer deposits declined $364mm or 2% in the quarter • Driven by $306mm decline in transactional trust deposits • Net loan-to-deposit ratio of 79% • NIM of 4.08%; reflects increasing deposit b
Slide 4: Deposits Highlights
4 Deposits Highlights Consumer 45% Commercial 24% Small Business 17% Trust 6% Wealth 7%Other 1% Total Customer Deposit Mix 6% 10% 11% 36% 38% 39% 21% 18% 19% 37% 34% 31% 0% 20% 40% 60% 80% 100% 3Q22 2Q23 3Q23 Noninterest Interest-bearing Savings/MM Time No and low interest DDA (WAC 35bps) represent
Slide 5: Loan Portfolio Trends
5 Loan Portfolio Trends • Commercial loan growth of $254 million or 3% (10% annualized) • Commercial line utilization of 38.3% • Consumer loan growth of $52 million driven by our Spring EQ partnership product (home equity loans) • Upstart portfolio declined $3 million to $232 million; ~2% of total g
Slide 6: Commercial Loan Composition
6 3 Commercial Loan Composition1 1 As defined by the North American Industry Classification System (NAICS) 2 Based on the underlying real estate collateral 3 Office portfolio excludes Medical Office CRE 2 Flex, Warehouse, Self- Storage, General Industrial, 9% Special Use & Other, 9% Medical Office,
Slide 7: Investment Portfolio
7 Investment Portfolio Long-term disciplined policies on Investment Portfolio concentrations, IRR, and Capital support optionality 1 Investment portfolio value includes market value AFS and book value of HTM 2 This is a non-GAAP financial measure and should be considered along with results prepared
Slide 8: Net Interest Margin Trends
8 2.00% 2.50% 3.00% 3.50% 4.00% 4.50% 3Q 2022 4Q 2022 1Q 2023 2Q 2023 3Q 2023 0.15% 0.35% 0.80% 1.16% 1.38% 5.12% 5.98% 6.42% 6.69% 6.81% 2.0% 4.0% 6.0% 8.0% 0.0% 1.0% 2.0% 3.0% 4.0% 3Q 2022 4Q 2022 1Q 2023 2Q 2023 3Q 2023 Lo an Y ie ld (% ) Cu st om er D ep os it Co st (% ) Total Deposit Cost Total
Slide 9: Core Fee Revenue Trends
9 $20 $16 $15 $15 $19 $15 $18 $18 $20 $21 $30 $31 $31 $32 $33 $65 $65 $64 $67 $73 $- $10 $20 $30 $40 $50 $60 $70 $80 3Q 2022 4Q 2022 1Q 2023 2Q 2023 3Q 2023 Co re F ee R ev en ue ( $m m )2 Banking Cash Connect Wealth Management3 Core Fee Revenue1 Trends Diversified and resilient core fee revenue inc
Slide 10: Asset Quality
10 Asset Quality 1 Prior to 1Q23, NPA included accruing TDRs 2 Concentration limits are based on relationship exposure, and Tier-1 + ACL; as of September 30, 2023 3 Based on relationship’s outstanding balances 4 Defined as the sum of CRE and Construction (excluding Owner-Occupied) $473 $462 $417 $46
Slide 11: Credit Risk Management – CRE Details
11 $0.0 $0.1 $0.2 $0.3 $0.4 $0.5 $0.6 2023 2024 2025 2026 2027 Bi lli on s Volume of Maturing CRE Loans by Industry Office Multi-Family Industrial Flex Retail Single Family Other 3.3% 9.6% 8.7% 8.0% 11.6% Credit Risk Management – CRE Details • $3.7 billion outstanding; $3.8 billion exposure • $1.2 m
Slide 12: ACL Ratio
12 ACL Ratio $145 $150 $155 $160 $165 $170 $175 $180 $185 6/30/2023 Economic Impact Net Loan Growth Migration / Other 9/30/2023 3Q 2023 ACL ($mm) ($6) $172 $5 $176 $5 1 Source: Oxford Economics as of September 2023 2 Percentages are over amortized cost of loans and HTM securities 3 Hotel loan balanc
Slide 13: Capital and Liquidity
13 Capital and Liquidity All capital ratios remain strong and significantly above “well-capitalized”; Substantial liquidity capacity with only 7% utilization of current funding capacity • $9.2 billion of available funding capacity • $6.9 billion readily available/secured (92% unused capacity) • Whol
Slide 14: 2023 Core Outlook
14 3 2023 Core Outlook Loan Growth Mid-to-high single digit On Track Deposit Growth Flat-to-low single digit decrease On Track Net Interest Margin Range of 3.95%-4.05% Trending Modestly Higher Fee Revenue Growth Mid-single digit Trending Modestly Higher Provision Costs 0.60% - 0.70% On Track Efficie
Slide 15: Appendix: Non-GAAP Financial Information
15 Non-GAAP Financial Information Appendix:
Slide 16: Non-GAAP Information
16 Non-GAAP Information This presentation contains financial measures determined by methods other than in accordance with accounting principles generally accepted in the United States (GAAP). This presentation may include the following non-GAAP measures: • Adjusted Net Income (non-GAAP) attributable
Slide 17: Appendix: Non-GAAP Financial Information
17 Appendix: Non-GAAP Financial Information Three Months Ended (dollars in thousands) September 30, 2023 June 30, 2023 September 30, 2022 Net interest income (GAAP) $ 182,602 $ 181,842 $ 176,831 Core net interest income (non-GAAP) $ 182,602 $ 181,842 $ 176,831 Noninterest income (GAAP) $ 72,668 $ 66
Slide 18: Appendix: Non-GAAP Financial Information
18 Appendix: Non-GAAP Financial Information Three Months Ended (dollars in thousands, except per share data) September 30, 2023 June 30, 2023 September 30, 2022 GAAP net income attributable to WSFS $ 74,166 $ 68,678 $ 73,382 Plus/(less): Pre-tax adjustments1 868 3,322 4,877 (Plus)/less: Tax impact o
Slide 19: Appendix: Non-GAAP Financial Information
19 Appendix: Non-GAAP Financial Information Three Months Ended (dollars in thousands) September 30, 2023 June 30, 2023 September 30, 2022 Calculation of return on average tangible common equity: GAAP net income attributable to WSFS $ 74,166 $ 68,678 $ 73,382 Plus: Tax effected amortization of intan