Bank Of N.t. Butterfield & Son Limited (the) Voting · NYSE:NTB
Bank Of N.t. Butterfield & Son Limited (the) Voting — The Bank of N.T. Butterfield & Son — Q4 2019 Earnings Presentation
23 slides from Bank Of N.t. Butterfield & Son Limited (the) Voting's earnings presentation, Feb 13, 2020
Slide 1: Fourth Quarter and Year-End Earnings Presentation
Fourth Quarter and Year-End Earnings Presentation The Bank of N.T. Butterfield & Son Limited February 13, 2020
Slide 2: Forward-Looking Statements
Forward-Looking Statements Forward-Looking Statements: Certain of the statements made in this release are forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. You can identify these forward-looking statements through our use of words such as “ma
Slide 3: Agenda and Overview
Agenda and Overview Presenters Agenda Butterfield Overview Michael Collins • Overview • Leading Bank in Attractive Markets Chairman and Chief Executive Officer • Financials • Strong Capital Generation and Return Michael Schrum • Q&A • Efficient, Conservative Balance Sheet Chief Financial Officer • V
Slide 4: Full Year 2019 Highlights
Full Year 2019 Highlights • Net income of $177.1 million, or $3.30 per share (In US$ millions) vs. 2018 • Core Net Income** of $197.9 million, or $3.69 per share 2019 $ % • Return on average common equity of 19.1%; core return on average Net Interest Income $ 345.7 $ 2.7 tangible common equity** of
Slide 5: Financials
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Slide 6: Fourth Quarter 2019 Highlights
Fourth Quarter 2019 Highlights • Net income of $43.9 million, or $0.82 per share (In US$ millions) vs. Q3 2019 vs. Q4 2018 • Core Net Income** of $46.2 million, or $0.87 per share Q4 2019 $ % $ % • Return on average common equity of 18.0%; core return on average Net Interest Income $ 86.2 $ (0.1) $
Slide 7: Income Statement Net Interest Income
Income Statement Net Interest Income Net Interest Margin & Yields Net Interest Income before Provision for Credit Losses - Trend (In US$ millions) Q4 2019 vs. Q3 2019 (In US$ millions) Avg. Balance Yield Avg. Balance Yield $87.4 $86.3 $86.2 Cash, S/T Inv. & Repos $ 3,791.9 1.14 % $ (642.5) 0.02 % In
Slide 8: Customer Deposits
Customer Deposits Deposit Composition By Currency Average Deposit Volume and Cost of Deposits 7.0% 10.2% 5,000 (In US$ millions) 13.0% 14.0% 1.48% 19.0% 20.2% 1.38% 4,000 80.0% 67.0% 69.6% 1.12% 3,000 Q4 Q1 Q2 Q3 Q4 2018 2019 USD / USD Pegged GBP 2,000 0.54% Other 0.50% 0.28% 1,000 0.25% 0.27% By Ty
Slide 9: Income Statement Non-Interest Income
Income Statement Non-Interest Income Non-Interest Income Trend (In US$ millions) (In US$ millions) Q4 2019 vs. Q3 2019 $49.7 $45.7 $46.6 Asset management $ 7.8 $ 0.4 Banking 14.0 1.9 FX Revenue 9.8 (0.2) Trust 13.0 0.3 Custody and Other 3.5 (0.2) Q4 Q1 Q2 Q3 Q4 Other 1.7 0.9 2018 2019 Total Non-Inte
Slide 10: Income Statement Non-Interest Expenses
Income Statement Non-Interest Expenses Core Non-Interest Expense Trend* Core Non-Interest Expenses* vs. Q3 2019 (In US$ millions) (In US$ millions) Q4 2019 $ % $91.6 Salaries & Benefits** $ 46.6 $ 3.9 9.1 % Technology & Comm. 16.5 0.2 1.2 % $83.1 $84.0 Property 7.0 1.0 15.7 % Professional & O/S Serv
Slide 11: Capital Requirements and Return
Capital Requirements and Return Regulatory Capital (Basel III) - Total Capital Ratio Leverage Capital 9.9% 19.4% 0.6% 7.7% 1.4% 16.3% 9.3% 13.7% 6.3% Butterfield Current BMA 2019 Required US Peer Median * Butterfield - Current US Peer Median * TCE/TA TCE/TA Ex Cash Dividend Payout Ratio** • Capital
Slide 12: Balance Sheet
Balance Sheet Total Assets (In US$ millions) Q4 2019 Q4 2018 (In US$ billions) Cash & Equivalents $ 2,550 $ 2,054 $14.2 $13.9 S/T Investments 1,218 52 Reverse Repos 142 27 $10.8 Loans (net) 5,143 4,044 Investments 4,436 4,255 Other Assets 432 340 $4.3 $4.7 $4.4 Total Assets $ 13,922 $ 10,773 $5.1 $4
Slide 13: Asset Quality
Asset Quality Non-Accrual Loans Investment Portfolio (In US$ millions) Loan Distribution Rating Distribution $51.9 Gov’t: $48.7 $50.4 7.2% BBB: 0.2% A: 0.5% Other Comm’l: AA: 0.3% 10.9% Res Mtg: 62.3% Comm’l R/E: 14.6% AAA: 99.0% Consumer: 5.0% $5.1 billion $4.4 billion Q4 Q1 Q2 Q3 Q4 2018 2019 • In
Slide 14: Interest Rate Sensitivity
Interest Rate Sensitivity Average Balance - Balance Sheet Interest Rate Sensitivity Average Balances (US 5.8% 5.6% $Mil) Weighted 3.6% 3.6% Average Q4 2019 vs. Q3 2019 Duration vs. Q3 2019 Life Cash & Reverse Repos 2,773.5 (1,310.4) N/A N/A N/A S/T Invest. 1,018.4 667.9 0.2 (0.1) N/A (4.0)% (4.0)% -
Slide 15: Appendix
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Slide 16: Appendix Balance Sheet Trends
Appendix Balance Sheet Trends (in millions of US Dollars, unless otherwise indicated) 2019 2018 2017 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Assets Cash & Equivalents $ 2,550 $ 3,605 $ 2,011 $ 2,601 $ 2,054 $ 1,259 $ 1,756 $ 1,846 $ 1,535 Reverse Repos 142 62 166 72 27 72 89 198 179 S/T Investments 1,218 793 163
Slide 17: Appendix Average Balance Sheet Trends
Appendix Average Balance Sheet Trends (in millions of US Dollars, unless otherwise indicated) Q4 2019 Q3 2019 Q4 2018 Average Interest Average rate Average Interest Average rate Average Interest Average rate Assets balance ($) ($) (%) balance ($) ($) (%) balance ($) ($) (%) Cash due from banks, reve
Slide 18: Appendix Income Statement Trends
Appendix Income Statement Trends (in millions of US Dollars, unless otherwise indicated) 2019 2018 2017 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Net Interest Income $ 86.2 $ 86.3 $ 85.2 $ 88.0 $ 87.4 $ 88.3 $ 87.4 $ 79.9 $ 76.1 Non-Interest Income 49.7 46.6 44.2 43.4 45.7 41.3 41.9 39.8 42.4 Prov. for Credit Reco
Slide 19: Appendix Non-Interest Income & Expense Trends
Appendix Non-Interest Income & Expense Trends (in millions of US Dollars, unless otherwise indicated) 2019 2018 2017 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Non-Interest Income Trust $ 13.0 $ 12.7 $ 13.0 $ 12.6 $ 13.8 $ 13.1 $ 13.2 $ 10.9 $ 11.3 Asset Management 7.8 7.4 6.9 6.7 6.5 6.5 6.2 6.4 6.6 Banking 14.0 1
Slide 20: Appendix Core Non-Interest Expense Trends
Appendix Core Non-Interest Expense* Trends (in millions of US Dollars, unless otherwise indicated) 2019 2018 2017 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Salaries & Benefits** $ 46.6 $ 42.8 $ 41.1 $ 42.8 $ 43.7 $ 43.8 $ 40.9 $ 37.0 $ 42.2 Technology & Comm. 16.5 16.3 15.2 14.6 14.8 15.4 14.9 14.6 14.3 Property 7
Slide 21: Appendix Non-GAAP Reconciliation
Appendix Non-GAAP Reconciliation (in millions of US Dollars, unless otherwise indicated) 2019 2018 Q4 Q3 Q2 Q1 Q4 Net income A $ 43.9 $ 42.4 $ 38.6 $ 52.1 $ 50.9 Non-core (gains), losses and expenses Non-core (gains) losses Gain on disposal of a pass-through note investment (formerly a SIV) — — — (1
Slide 22: Appendix Non-GAAP Reconciliation (cont'd)
Appendix Non-GAAP Reconciliation (cont’d) (in millions of US Dollars, unless otherwise indicated) 2019 2018 Q4 Q3 Q2 Q1 Q4 Tangible equity to tangible assets Shareholders' equity $ 963.7 $ 964.6 $ 928.7 $ 896.2 $ 882.3 Less: goodwill and intangible assets (96.5) (93.4) (72.2) (74.1) (74.7) Tangible
Slide 23: Appendix Peer Group
Appendix Peer Group Our peer group includes the following banks, noted by their ticker symbols: • FRC • SIVB • EWBC • CFR • ASB • WTFC • CBSH • IBKC • UMBF • FHB • BOH • TRMK • IBOC • CBU • BPFH • FFIN • WABC 23
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