Slide 1: 2Q20 Quarterly Earnings Supplement
2Q20 QUARTERLY EARNINGS SUPPLEMENT July 28,2020
Slide 2: Special Note Concerning Forward-Looking Statements
Special Note Concerning Forward-Looking Statements Statements made in this document, other than those concerning historical financial information, may be considered forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial con
Slide 3: Non-GAAP Financial Measures
Non-GAAP Financial Measures This document contains financial information determined other than in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Management uses these “non-GAAP” measures in its analysis of the Company’s performance. Management also
Slide 4: Table of Contents
Table of Contents Overview of First Busey Corporation (BUSE) 5 Business Highlights 6 Diversified Business Model 7 Protecting a Strong Balance Sheet 8 Robust Capital Foundation 9 High Quality Loan Portfolio 10 Entering Credit Cycle from Position of Strength 16 Current Expected Credit Loss (CECL) Mode
Slide 5: Overview of First Busey Corporation (BUSE)
Overview of First Busey Corporation (BUSE) Company Overview Branch Map • 150+ year old bank headquartered in Champaign, IL • • Full service community bank serving Illinois, St. Louis, Indianapolis, and Southwest Florida markets • Diversified lending portfolio across real estate, commercial, and reta
Slide 6: Business Highlights
Business Highlights • Established in 1868, with more than 150 years of commitment to local communities and businesses • Operating with 80 branches across four states: Illinois, Missouri, Indiana, and Florida Attractive • Experienced and proven management team Franchise • Attractive and diverse busin
Slide 7: Diversified Business Model
Diversified Business Model Banking the intersection of commercial and wealth Business Investment Advisory Business Solutions Commercial Lending Investment Services Custom Consulting Business Saving Services Lockbox Processing Business Checking Services Investment Management Payment Concentrator Proc
Slide 8: Protecting a Strong Balance Sheet
Protecting a Strong Balance Sheet • Capital ratios significantly in excess of well-capitalized minimums • Regulatory capital relief on CECL implementation and PPP loans Robust • TCE/TA ratio of 8.43% at 6/30/20 Capital • Total RBC of 16.23% at 6/30/20 ($125mm sub-debt raise in 2Q20) Foundation • Sus
Slide 9: Robust Capital Foundation
Robust Capital Foundation Tangible Common Equity Ratio (1) Leverage Ratio ($ in m $ in millions) illions $ in m illions 10.4% 9.8% 9.9% 9.9% 9.4% 9.5% 9.3% 9.2% 8.4% 8.4% $884 $922 $922 $941 $865 $864 $784 $703 $718 $638 4% 2017 Q4 2018 Q4 2019 Q4 2020 Q1 2020 Q2 2017 Q4 2018 Q4 2019 Q4 2020 Q1 2020
Slide 10: High Quality Loan Portfolio
High Quality Loan Portfolio Loan Portfolio Composition as of 6/30/2020 Loan Geographic Segmentation Other HELOCs 0% 5% 1-4 Family Residential Commercial & 16% Industrial 33% Construction & Development 6% Owner Non-Owner Occupied CRE Occupied CRE 13% 27% Funded Draws & Line Utilization Rate (1) $ in
Slide 11: High Quality Loan Portfolio: C&I
High Quality Loan Portfolio: C&I C&I Portfolio Overview C&I Loans by Sector (ex-PPP) ▪ 25% of total loan portfolio (ex-PPP loans) $ in thousands 2020 Q2 % of Total Classified ▪ Diversified portfolio results in low levels of Balances Loans Loan concentrated exposure NAICS Sector (ex-PPP) (ex-PPP) Bal
Slide 12: Loan Portfolio: Low Levels of Concentrated Exposure
Loan Portfolio: Low Levels of Concentrated Exposure $ in thousands Manufacturing Loans Manufacturing Loans 2020 Q2 % of Total % Balances % of Total Balances Loans Modified COVID-19 Classified Classified PPP Manufacturing Subsector (ex-PPP) (ex-PPP) Balances Modified Balances Loans Balances Loans: $2
Slide 13: High Quality Loan Portfolio: CRE
High Quality Loan Portfolio: CRE $ in thousands Owner Occupied CRE Loans by Industry Investor Owned CRE Loans by Industry (1) 2020 Q2 % of Total 2020 Q2 % of Total Balances Loans Classified Balances Loans Classified Property Type (ex-PPP) (ex-PPP) Loan Balances Property Type (ex-PPP) (ex-PPP) Loan B
Slide 14: Loan Portfolio: Low Levels of Concentrated Exposure
Loan Portfolio: Low Levels of Concentrated Exposure $ in thousands Retail Trade & Retail CRE Loans 2020 Q2 % of Total COVID-19 % of Classified Community Balances Loans % Balances Weighted Loans in PPP Shopping Retail Retail Type (ex-PPP) (ex-PPP) Modified Avg LTV Segment Balances Center Center Strip
Slide 15: Loan Portfolio: Low Levels of Concentrated Exposure
Loan Portfolio: Low Levels of Concentrated Exposure $ in thousands Food Services Loans Full Serv 2020 Q2 % of Total COVID-19 % of Classified Other Restaurant Balances Loans % Balances Weighted Loans in PPP 1% Ops Food Services Type (ex-PPP) (ex-PPP) Modified Avg LTV Segment Balances 16% Full-Service
Slide 16: Entering Credit Cycle from Position of Strength
Entering Credit Cycle from Position of Strength Overview NPAs / Assets ▪ Conservative underwriting and strong asset $ in m illions quality allow the Company to enter the economic 10,836 downturn well-prepared 9,696 ▪ Non-performing assets have decreased over time 7,861 7,702 while total assets have
Slide 17: Current Expected Credit Loss (CECL) Model
Current Expected Credit Loss (CECL) Model ▪ On January 1, 2020, the Company adopted ASU 2016-13 (Topic 326), “Measurement of Credit Losses on Financial Instruments,” commonly referenced as the CECL model. Upon adoption of CECL, we recognized: - $16.8 million increase in our allowance for credit loss
Slide 18: Adoption of CECL Fortifies Loan Loss Reserves
Adoption of CECL Fortifies Loan Loss Reserves Allowance / Loans (ex-PPP) Allowance / NPAs $ in m illions ($ $ in thousands millions) 1.48% $36,974 $6,687 330% $6,500 $32,564 $5,520 $5,568 $28,648 $29,135 0.97% 0.91% 187% 0.80% 165% 137% 2017 Q4 2018 Q4 2019 Q4 2020 Q2 2017 Q4 2018 Q4 2019 Q4 2020 Q2
Slide 19: Ample Sources of Liquidity
Ample Sources of Liquidity Deposit Composition Total Deposits & Loan to Deposit Ratio $ in m illions $ in m illions CD > 250k 4% $8,910 CD < 250k $7,902 $7,973 13% 90.8% 88.7% Non-Int DDA 84.8% 84.6% $6,249 81.1% 29% $6,126 Savings & MMDA 30% Int DDA 24% 2017 Q4 2018 Q4 2019 Q4 2020 Q1 2020 Q2 Total
Slide 20: Quarterly Earnings Review
Quarterly Earnings Review • Net Interest Income increased from $69.4 million in Q1 to $70.8 million in Q2 • Net Interest Margin decreased 17 bps vs Q1 from 3.20% to 3.03% • NIM impacted by late Q1 Fed rate actions, PPP loan funding and corresponding deposit retention as well Net Interest as $125mm s
Slide 21: Core Earnings Power
Core Earnings Power Core Net Income & Earnings Per Share (1) Core ROAA & ROATCE (1) ($ in thousands $ in millions) 14.5% 14.9% $31,782 14.5% $30,535 $29,498 12.2% $26,191 1.30% 1.24% 1.25% $0.55 $0.57 $0.53 7.4% 1.02% $15,479 $0.48 $0.28 0.64% 2019 Q2 2019 Q3 2019 Q4 2020 Q1 2020 Q2 2019 Q2 2019 Q3
Slide 22: Net Interest Margin
Net Interest Margin Net Interest Income & Net Interest Margin ($ in millions) • Net impact of PPP loans and corresponding excess 74.2 74.3 liquidity drove down NIM 9 bps during the quarter 72.7 3.5 3.0 71.5 3.0 70.2 • Subordinated debt issuance of $125mm on June 2.5 1, 2020 impacted quarterly NIM by
Slide 23: Diversified and Significant Sources of Fee Income
Diversified and Significant Sources of Fee Income Overview Non-Interest Income / Total Income ▪ Anchored by wealth management and $ in m illions payment processing, fee income represented $101.3 $104.4 $103.6 $98.8 $97.0 approximately 29% of total income over the last 12 months ▪ Strong source of re
Slide 24: Resilient Wealth Management Platform
Resilient Wealth Management Platform Wealth - Assets Under Care Overview ($ in millions $ in millions) ▪ Provides a full range of asset management, $9,696 investment and fiduciary services to $9,409 individuals, businesses and foundations, tax $8,967 $8,925 $9,021 preparation, philanthropic advisory
Slide 25: Focused Control on Expenses
Focused Control on Expenses Non-Interest Expense Overview ($ in millions) ▪ The Company continues to manage its $68,020 $68,121 $65,490 efficiency ratio by limiting nominal costs, as $2,412 $2,360 well as leveraging efficiencies throughout its $2,681 $7,293 $7,670 $60,514 branch network as a result
Slide 26: COVID-19 Pandemic Response
COVID-19 PANDEMIC RESPONSE 2626
Slide 27: Supporting Financial Needs of Customers
Supporting Financial Needs of Customers COVID-19 Response Actions – as of July 24, 2020 Commercial and Small Business Clients ▪ Busey is offering several options to Busey’s qualifying business customers to help them through this period of economic disruption. Various six-month modification programs
Slide 28: Supporting Financial Needs of Customers
Supporting Financial Needs of Customers COVID-19 Response Actions – as of July 24, 2020 Personal Loan and Mortgage Customers ▪ For those experiencing or anticipating hardships due to COVID-19, Busey is offering multiple payment deferral options for qualifying customers with loans - personal, auto, h
Slide 29: Participating in the CARES Act Paycheck Protection Program
Participating in the CARES Act Paycheck Protection Program Small Business Applications & Loan Funding ▪ As part of the CARES Act, Congress appropriated approximately $349 billion for the creation of the Paycheck Protection Program (PPP) as well as approving on April 24, 2020 an additional $310 billi
Slide 30: Appendix
APPENDIX FIRST BUSEY CORPORATION
Slide 31: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures ($ in thousands) Three Months Ended June 30, March 31, December 31, S eptember 30, June 30, 2020 2019 2019 2019 2019 Net interest income $ 70,813 $ 69,433 $ 71,936 $ 73,476 $ 73,428 Non-interest income 27,964 27,517 31,638 30,936 27,896 Less net losses/gains on sal
Slide 32: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures ($ in thousands) Three Months Ended June 30, March 31, December 31, S eptember 30, June 30, 2020 2020 2019 2019 2019 Reported: Net Interest income $ 70,813 $ 69,433 $ 71,936 $ 73,476 $ 73,428 Tax-equivalent adjustment 717 730 781 778 777 Tax-equivalent interest inc