Private Bancorp of America, Inc. · NASDAQ:PBAM
Private Bancorp of America — Q4 2023 Earnings Presentation
26 slides from Private Bancorp of America's earnings presentation, Jan 19, 2024
Slide 1: Q4 2023 Investor Update
Private Bancorp of America, Inc.(OTCQX: PBAM) (Holding Company for CalPrivate Bank) Q4 2023 Investor Update January 19, 2024
Slide 2: Disclosures
Disclosures FORWARD LOOKING STATEMENTS This presentation contains expressions of expectations, both implied and explicit, that are “forward‐looking statements” within the meaning of such term in the Private Securities Litigation Reform Act of 1995. We caution you that a number of important factors c
Slide 3: Corporate Overview
Corporate Overview The CalPrivate Bank Franchise Coastal Southern California Footprint • Founded in 2006 and headquartered in La Jolla, California, Private Bancorp of America, Inc. owns and operates CalPrivate Bank, a dynamic relationship‐based commercial bank Los Angeles County Beverly Hills • With
Slide 4: Consistent Focus on Shareholder Value Creation
Consistent Focus on Shareholder Value Creation Growth Oriented Strategy $ Total Assets (in Billions) • Culture of excellence in all aspects of serving Clients 19.1% CAGR • Growth oriented Sales and Service Teams • Consistent growth of earning assets at strong yields • Core EPS growth above 50% CAGR
Slide 5: Q4 2023 Results and Highlights
Q4 2023 Results and Highlights • Financial * Highlights Operational • * & Performance Highlights • 50.22% Efficiency Ratio • $7.9 million in Net Income • 4.33% Net Interest Margin • $1.36 Earnings Per Diluted Share • 1.51% Return On Average Assets • $2.15 billion in Assets • 17.53% Return On Average
Slide 6: Strategic Focus – 2024
Strategic Focus – 2024 • Drive organic growth through relationship‐based banking, expanding current client relationships and obtaining new ones Opportunistic Balance Sheet • Opportunistic top‐tier talent acquisition for new markets and current market expansion Growth • Broader penetration into High
Slide 7: Managing NIM in a Volatile Environment
Managing NIM in a Volatile Environment Asset Yields & Cost of Funds NIM Protection Strategy Proven Relationship Banking model allows for keen understanding of Clients and providing them with value Strong Loan Yields • Desirable mix of Fixed, Variable and Hybrid loan types • Fixed Rate Loan Terms gen
Slide 8: Strong Deposit Franchise
Strong Deposit Franchise Emphasis on deposit retention in an environment of higher rates and extreme competition. Focus on proactive management of exception priced deposits with an eye on the Fed and client yield alternatives Growing Customer Deposits Deposit Rate Trends • Total deposits increased $
Slide 9: Noninterest Deposit Trends
Noninterest Deposit Trends Our Teams focus on full Relationships and operating accounts. Non‐interest bearing DDA balance growth resulting from extended low rate environment and unprecedented government stimulus is returning to historical levels Noninterest Deposit Composition Trend Since 2018 $2,00
Slide 10: Strong Liquidity & Funding Position
Strong Liquidity & Funding Position Focus on maintaining strong liquidity position and optimizing funding mix Liquid Assets Total Available Liquidity Note: Dollars in Millions & Unused Uninsured Liqudity Sources (000's) Deposits Cash, unrestricted 173,882 19% 1 Liquid Securities 97,885 11% Total Liq
Slide 11: Loan Originations by Quarter
Loan Originations by Quarter Due to slower loan demand across the industry and with our Clients, we are opportunistically lending across all channels and regions at rates of return to drive higher Net Interest Income and support NIM Loan Originations (Contract Amount, $ in millions) Commentary Key O
Slide 12: Demonstrated Organic Growth in Loans
Demonstrated Organic Growth in Loans Taking advantage of market opportunities and restricted lending by others produced increases in loan balances by 16% YoY with strong yields Loan Balances Note: Dollars in Millions 12
Slide 13: Loan Portfolio Breakdown
Loan Portfolio Breakdown Loan Portfolio by Industry Loan Secured by Real Estate Borrower's Industry Total % of Total (by NAICS sector code) (in 000s)* Loans $1,485 Million of Loan Portfolio Secured by Real Estate (80%) Real Estate Investment/ Rental & Leasing $ 963,900 52.1% Construction/ Builders &
Slide 14: Total Revolving Lines of Credit
Total Revolving Lines of Credit Total Revolving Lines of Credit $ in millions Revolving Line of Credit $ Line Utilization Overview Utilization & Rates • 18% Compound Annual Growth Rate (CAGR) for revolving • Use of floors on variable lines to mitigate NIM compression line amounts over last 8 quarter
Slide 15: SBA Lending and Shifting Market Dynamics
SBA Lending and Shifting Market Dynamics Shifting loan sales to balance sheet portfolio given softness in market and attractive loan yields, partially offset by higher prepay speeds on the SBA 7a portfolio. Approx 1/3 of SBA 7a balances are guaranteed. SBA Originations Increasing SBA Loan Balances S
Slide 16: Interest Rate Risk Management
Interest Rate Risk Management Loans Repricing & Maturities Interest Rate Sensitivity December 31, 2023 Fixed‐Rate Loans Adjustable‐Rate Loans (incl. Hybrids) Estimated Change from 12/31/23 Baseline forecast Balance (in % of Term to Rate Balance (in % of Term to Maturity 000's) Rate Loans Adjust 000'
Slide 17: Solid Credit Risk Management Metrics
Solid Credit Risk Management Metrics Proactive credit risk and loan portfolio management leading to minimal substandard assets Criticized Loans Classified Loans • Total Unsecured Criticized Loans were $0 for all periods. • Unsecured = any loans that are not secured by a real estate property or cash
Slide 18: Solid Credit Risk Management Metrics
Solid Credit Risk Management Metrics High‐touch relationship‐based banking model results in superior portfolio performance Credit Commentary • Proactive SBA and Loan Portfolio Management • 4 total non‐performing loans ($5.1 million) • 1 CRE Loan with 46% LTV • 1 SBA Loan with 75% Guarantee ($285K Gu
Slide 19: Current Expected Credit Loss (“CECL”) Implementation
Current Expected Credit Loss (“CECL”) Implementation ACL Roll‐Forward CECL 1Q'23 2Q'23 3Q'23 4Q'23 Jan 1, 2023 Dec 31, 2022 Adoption Change in Mar 31, 2023 Change in Jun 30, 2023 Change in Sep 30, 2023 Change in Dec 31, 2023 CECL $ in thousands Impact Reserve CECL Reserve CECL Reserve CECL Reserve C
Slide 20: Expenses and Operational Efficiency
Expenses and Operational Efficiency Ongoing focus on improving operating leverage through technology and process improvement initiatives while adding talent and improving capabilities and offerings to our Clients Non‐interest Expenses Non‐interest Expense Details • Increase of $430K in Compensation
Slide 21: Strong Capital Position
Strong Capital Position Strong build of capital ratios in 2023, even with 16% balance sheet growth, with no planned dividends Selected CalPrivate Bank Capital Ratios * *Preliminary Tangible Book Value per Share Capital Strategy • Manage capital to achieve strong levels of Return on Equity • Proven a
Slide 22: Distinctly Different Service – 2023 NPS Score
Distinctly Different Service – 2023 NPS Score CalPrivate Bank premium service model is a disruptor in the banking sector. 2023 Top Banks and Service Businesses (1) CPB client satisfaction over 2x 82 CalPrivate Bank higher than U.S. Banking Industry 69 USAA (top ranked Bank) Exceptional service is
Slide 23: Community Outreach & Diversity
Community Outreach & Diversity Community Support • An important aspect to our company culture is community engagement • CalPrivate Bank donates to non‐profit organizations across a wide range of community groups from Los Angeles to San Diego • Employee contributions are matched • Team members donate
Slide 24: Technology & Innovation Differentiation
Technology & Innovation Differentiation • Added Board level expertise in technology, audit and innovation Technology & Innovation Board • Dedicated focus on digital transformation Committee • Provides oversite on roadmap, governance and budget • Enhancing focus on Cybersecurity and emerging security
Slide 25: Management Contacts
Management Contacts Rick Sowers President & Chief Executive Officer o. 424.303.4894 c. 310.569.3635 e. rsowers@calprivate.bank Cory Stewart EVP & Chief Financial Officer c. 206.293.3669 e. cstewart@calprivate.bank 25
Slide 26: Q&A
Q&A Priv a t e B a n c o rp o f A m e ric a , I n c. (OTCQX: P B A M ) (Holding Company for CalPrivate Bank)
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