Wesbanco, Inc. · NASDAQ:WSBC
Wesbanco — Investor Presentation (February 2021)
32 slides from Wesbanco's investor presentation, Feb 10, 2021
Slide 1: Investor Presentation (Q1 2021)
John Iannone Senior Vice President, Investor & Public Relations 304-905-7021 Investor Presentation (Q1 2021) (WSBC financials as of the three months ended 31 December 2020)
Slide 2: Forward-Looking Statements and Non-GAAP Financial Measures
Forward-Looking Statements and Non-GAAP Financial Measures 1 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
Slide 3: Evolving Regional Financial Services Institution
2 Evolving Regional Financial Services Institution Strong market presence across legacy and major metropolitan markets Balanced loan and deposit distribution across diverse regional footprint Diversified revenue generation engines supported by unique long-term advantages Well-executed long-term grow
Slide 4: Investment Rationale
3 Investment Rationale Balanced loan and deposit distribution across footprint Diversified earnings streams built for long-term success, led by century-old, $5.0B trust and wealth management business Strong presence in economically diverse, major markets supported by positive demographic trends Robu
Slide 5: Strategies for Long-Term Success
Strategies for Long-Term Success
Slide 6: Long-Term Growth Strategies
5 Long-Term Growth Strategies Focus on Delivering Positive Operating Leverage Strong Legacy of Credit Quality, Risk Management, and Compliance Diversified Loan Portfolio with C&I and Home Lending Focus Long History of Strong Wealth Management Capabilities Digital Banking Service Strategies & Core De
Slide 7: Diversified Loan Portfolio
6 Diversified Loan Portfolio Focus on strategic diversification, growth, and credit quality Balance disciplined loan origination with prudent lending standards Focus on C&I and home equity lending Key offerings include treasury management, foreign exchange, cyber security, and lockbox services Stron
Slide 8: Strong Wealth Management Capabilities
Private Banking $930MM in private banking loans and deposits 3,250+ relationships Growth opportunities from shale-related private wealth management Expansion opportunities in KY, IN, and Mid-Atlantic 7 Strong Wealth Management Capabilities Note: assets, loans, deposits, and clients as of 12/31/2020;
Slide 9: Digital Banking
Digital banking utilization ~72% of retail customers utilize online digital banking services 4 million web and mobile logins per month Mobile 50% of total, with an average of 17 monthly logins per customer Mobile wallet & mobile deposits increased 70% & 55% YoY, respectively Zelle® to be utilized as
Slide 10: Benefits of Core Deposit Funding Advantage
9 Benefits of Core Deposit Funding Advantage Robust legacy deposit base, enhanced by shale energy-related royalties, provides funding advantage in Mid-Atlantic market Reflecting the significantly lower interest rate environment, aggressively reduced deposit rates throughout 2020 During the last five
Slide 11: Franchise Expansion
10 Franchise Expansion Targeted acquisitions in existing markets and new higher-growth metro areas Long-term focus on appropriate capital management to enhance shareholder value Strong capital and liquidity, along with strong regulatory compliance processes, provides ability to execute transactions
Slide 12: Focus on Positive Operating Leverage
11 Focus on Positive Operating Leverage Disciplined growth, balanced by a fundamental focus on expense management and supported by franchise-enhancing acquisitions, in order to deliver positive operating leverage and enhance shareholder value Note: financial data as of 12/31; current year-to-date (Y
Slide 13: Strong Risk Management and Capital Position
Strong legacy of credit and risk management and regulatory compliance Based upon conservative underwriting standards and approval processes supported by centralized back-office and loan funding functions Mature enterprise risk management program headed by Chief Risk Officer addressing key risks in a
Slide 14: Recent Successes and Accolades
13 Recent Successes and Accolades Named to Newsweek magazine's inaugural ranking of America's Best Banks, recognizing those banks that best serve their customers needs, as well as being named the Best Big Bank in the state of West Virginia The Central Ohio market of WesBanco Bank was awarded a “Top
Slide 15: Financial Overview
Ay WesBanc By all accounts, better. Financial Overview
Slide 16: Q4 2020 Financial and Operational Highlights
Q4 2020 Financial and Operational Highlights 15 Note: financial and operational highlights during the quarter ended December 31, 2020; loan growth includes approximately $726.3 million of loans funded through the Small Business Administration’s Paycheck Protection Program (“SBA PPP”), as established
Slide 17: Q4 2020 Total Portfolio Loans
Q4 2020 Total Portfolio Loans ($MM) 16 ~6,850 SBA PPP loans from the first rounds totaling ~$726MM remaining (as of 12/31/2020) (recorded in C&I loan category) Q4 residential real estate loan levels were impacted by retaining a smaller percentage of the $351 million of Q4 mortgage origination dollar
Slide 18: Q4 2020 Net Interest Margin (NIM)
Q4 2020 Net Interest Margin (NIM) 17 NIM negatively impacted by the low interest rate environment and flattening of the yield curve The Federal Reserve Board’s target federal funds rate was reduced 225bp from July 2019 through March 2020 Aggressively reduced deposit rates throughout 2020, which help
Slide 19: Q4 2020 Non-Interest Income
Q4 2020 Non-Interest Income 18 Mortgage banking fees increased due to a 75% year-over-year increase in 1-to-4 family residential mortgage origination dollar volume, and the associated sale of ~65% of those originations into the secondary market (40-50% historically) Service charges on deposits were
Slide 20: Q4 2020 Non-Interest Expense
Q4 2020 Non-Interest Expense 19 Total operating expenses remained well-controlled through company-wide efforts Efficiency ratio improved 123bp year-over-year to 57.06% Total non-interest expense increased year-over-year due to the additional staffing and financial center locations from the OLBK acqu
Slide 21: Comparable Operating Metrics
20 Comparable Operating Metrics Disciplined execution upon growth strategies providing strong performance compared to all U.S. banks with total assets from $10B to 25B (note: 2020 comparability impacted by timing of the adoption of CECL accounting standard and economic assumptions used by each bank)
Slide 22: Solid Legacy of Credit Quality
Non-Performing Assets as % of Total Assets Net Charge-Offs as % of Average Loans (annualized) Allowance for Credit Losses as % of Total Loans Criticized & Classified Loans as % of Total Loans Favorable asset quality measures compared to all U.S. banks with total assets from $10B to 25B (note: 2020 A
Slide 23: Returning Value to Shareholders
Returning Value to Shareholders Focus on appropriate capital allocation to provide financial flexibility while continuing to enhance shareholder value through earnings growth and effective capital management Capital management strategy: dividends, share repurchases, acquisitions Q4 2020 dividend yie
Slide 24: Appendix
By all ane © iter Appendix
Slide 25: Q4 2020 Key Metrics
Q4 2020 Key Metrics 24 Note: PTPP = pre-tax, pre-provision; OLBK financial results included in WSBC results since merger consummation date of 11/22/2019 Non-GAAP measure – please see reconciliation in appendix Excludes restructuring and merger-related expenses
Slide 26: Q4 2020 Current Expected Credit Loss (CECL)
The increase in the allowance was related to the COVID-19 related adjustments and changes in prepayment assumptions and the loan portfolio partially offset by improvement in the macroeconomic forecast Allowance coverage ratio of 1.72%, or, excluding SBA PPP loans, 1.85% Excludes fair market value ad
Slide 27: Customer Support Efforts During the Pandemic
26 Customer Support Efforts During the Pandemic Note: deferral data reflects loan deferrals accepted and closed by customers for each time period; the majority of hospitality loan-to-values are pre-pandemic Pandemic-related loan deferral balances down ~90% from May 2020 peak All retail deferrals tar
Slide 28: Reconciliation: Efficiency Ratio & Operating Leverage
Reconciliation: Efficiency Ratio & Operating Leverage 27 Note: “efficiency ratio” is non-interest expense excluding restructuring and merger-related expense divided by total income; FTE represents fully taxable equivalent; Old Line Bancshares merger closed November 2019; Farmers Capital Bank Corpora
Slide 29: Reconciliation: Pre-Tax, Pre-Provision Income (PTPP) and Ratios
Reconciliation: Pre-Tax, Pre-Provision Income (PTPP) and Ratios 28 Note: Old Line Bancshares merger closed November 2019
Slide 30: Reconciliation: Net Income, EPS & Tangible Book Value per Share
Reconciliation: Net Income, EPS & Tangible Book Value per Share 29 Note: Current Expected Credit Losses (“CECL”) accounting standard adopted January 1, 2020 by WSBC; Old Line Bancshares merger closed November 2019
Slide 31: Reconciliation: Return on Average Assets
30 Note: Current Expected Credit Losses (“CECL”) accounting standard adopted January 1, 2020 by WSBC; Old Line Bancshares merger closed November 2019; Farmers Capital Bank Corporation merger closed August 2018; First Sentry Bancshares merger closed April 2018; Your Community Bankshares merger closed
Slide 32: Reconciliation: Return on Average Tangible Equity
31 (1) amortization of intangibles tax effected at 21% for 2018 forward, and 35% for all prior periods Note: Current Expected Credit Losses (“CECL”) accounting standard adopted January 1, 2020 by WSBC; Old Line Bancshares merger closed November 2019; Farmers Capital Bank Corporation merger closed Au