Provident Financial Services, Inc · NYSE:PFS
Provident Financial Services — Q4 2024 Earnings Presentation
28 slides from Provident Financial Services's earnings presentation, Jan 28, 2025
Slide 1: Q4 2024 Results Presentation
Q4 2024 RESULTS PRESENTATION
Slide 2: Forward Looking Statements
NYSE: PFS Forward Looking Statements Certain statements contained herein are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amen
Slide 3: Corporate Profile
NYSE: PFS Corporate Profile (At or for the Quarter Ended 12/31/24) 3 Bank founded: 1839 Stock symbol: PFS (NYSE) Branches: 140 serving New Jersey, eastern Pennsylvania, and Orange, Queens, and Nassau Counties, New York Market capitalization: $2.5 Billion as of 1/27/2025 Balance sheet: $24.1 Billion
Slide 4: Q4 2024 Financial Highlights
NYSE: PFS 4 Q4 2024 Financial Highlights $0.37 Diluted EPS 1.05% Adjusted ROAA 9.53% Adjusted ROAE 15.39% Adjusted ROATE Key Metrics Highlights • Adjusting for transaction costs related to the merger with Lakeland, net of tax, the Company's annualized adjusted returns on average assets, average equi
Slide 5: Stable Core Funding Base
NYSE: PFS Stable Core Funding Base DEPOSIT COMPOSITION 5 Non-interest bearing deposits 20.2% Interest bearing core deposits 41.6% Municipal deposits 21.0% Certificates of deposit 15.0% Wholesale deposits 2.2% December 31, 2024 Q4 Cost of Interest-Bearing Deposits 2.81% Q4 Total Cost of Deposits 2.25
Slide 6: Diversified Portfolio of Loans Held for Investment
NYSE: PFS Diversified Portfolio of Loans Held for Investment December 31, 2024 6 Residential Mortgage Loans 11% Commercial Mortgage 39% Multi-family Loans 18% Commercial Construction Loans 4% Commercial Loans 25% Consumer Loans 3% LOAN COMPOSITION Q4 2024 Avg Net Loan Yield 5.99% ($'s in thousands)
Slide 7: CRE Investment Portfolio by Property Type
NYSE: PFS CRE Investment Portfolio by Property type 7 As of 12/31/24 MULTI- FAMILY 31.9% RETAIL 23.3% INDUSTRIAL 18.8% OFFICE 8.2% MIXED USE 7.7% SPECIAL USE 5.0% RESIDENTIAL 3.3% HOTEL 1.2% LAND 0.6% Portfolio Characteristics 10 Largest CRE Loans 4.03% of CRE Investment Portfolio 10 Largest CRE Loa
Slide 8: Multi-family Composition
NYSE: PFS Multi-family Composition (NY and Rent Stabilized sectors) 8 OTHER NY BOROUGHS 63% OTHER NY 25% MANHATTAN 12% Total NY Multi-family Loans = $446.5 Million Total multi-family loan portfolio: $3.34 Billion • Of the total, 88 Loans on multi-family properties in the five boroughs of NYC, aggreg
Slide 9: CRE Office Composition
NYSE: PFS CRE Office Composition 9 • Medical Office: approx. 36% of total office portfolio. Maturity or Reprice by Year 2024 $14.7 M 2025 81.0 M 2026 104.4 M 2027 70.2 M 2028 160.3 M 2029 & BEYOND 453.5 M Total $884.1M OFFICE - OUT OF MARKET 5% PENNSYLVANIA 11% OTHER NY 2% OTHER NY BOROUGHS 9% MANHA
Slide 10: C&I Loans by NAICS Sector
NYSE: PFS C & I – (Includes owner occupied) Loans by NAICS Sector – December 31, 2024 10 Real Estate and Rental and Leasing 22% Health Care and Social Assistance 19% Construction 6% Manufacturing 10% Finance and Insurance 5% Wholesale Trade 6% Retail Trade 5% 13 Diversified Sectors 27% 1. Other Serv
Slide 11: Strong Credit Metrics
Strong Credit Metrics 11 0.99% 0.98% 1.00% 1.02% 1.04%Total allowance to total loans 0.46% 0.44% 0.36% 0.47% 0.39%Total non-performing loans to total loans 0.43% 0.42% 0.33% 0.41% 0.34%Total non-performing assets as a percentage of total assets 0.03% 0.04% 0.04% 0.14% 0.12% Net charge-off ratio Q4 2
Slide 12: Investment Portfolio
NYSE: PFS Agency Notes - Fixed 3.79% U.S. Treasury Notes 10.68% Corporate Notes 3.58% Agency MBS - Fixed 41.62%Agency MBS - ARMs 0.28% Agency CMO 18.41% Corporate CMO - Fixed 0.02% Non Agency CMBS 1.25% Municipal Bonds 13.83% Student Loan Pools 1.54% Agency CMBS 5.01% Investment Portfolio 12 Total I
Slide 13: Net Interest Margin Analysis
NYSE: PFS Net Interest Margin Analysis 13 2.79% 2.87% 3.40% 3.69% 3.78% 5.50% 5.51% 6.05% 6.21% 5.99% 5.04% 5.06% 5.67% 5.84% 5.66% Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q4 2024 Asset Yields Securities Net Loans Total interest-earning assets 2.47% 2.60% 2.84% 2.96% 2.81% 3.71% 3.60% 3.83% 3.73% 3.64% 2.71
Slide 14: Emphasis on Fee Income
NYSE: PFS $0 $5,000 $10,000 $15,000 $20,000 $25,000 $30,000 Q4 23 Q1 24 Q2 24 Q3 24 Q4 24 Emphasis on Fee Income Non-Interest Income $ in thousands 14 Q4 23 Q1 24 Q2 24 Q3 24 Q4 24 Fees $ 6,102 $ 5,912 $ 8,699 9,816 $ 9,687 Wealth management income 6,843 7,488 7,769 7,620 7,655 Insurance agency inco
Slide 15: Focus on Wealth Management Business
NYSE: PFS * Represents interest on lines of credit to Beacon clients, whose investment accounts are pledged as collateral. Advisory 87% Trust & Estate 8% Tax 2% Private Banking 3% Focus on Wealth Management Business 15 $4.2 Billion AUM For 1,049 family relationships 2024 YTD Revenue Advisory $ 27,52
Slide 16: Focus on Wealth Management Business
NYSE: PFS AVERAGE CLIENT SIZE $4,000,000 As of December 31, 2024, based on AUM of $4.2B for 1,049 family relationships AVERAGE FEE 73 bps EBITDA & NET INCOME EBITDA (YTD December 31, 2024) $ 14,984,885 Net Income (YTD December 31, 2024) $ 10,610,329 CROSSOVER PROVIDENT/BEACON (HOW MANY PROVIDENT CUS
Slide 17: Provident Protection Plus, Inc.
NYSE: PFS • Provident Protection Plus, Inc. provides insurance agency services including business, personal and employee benefits insurance products. • The insurance agency’s primary source of revenue is commission income earned from the sale of business and personal property and casualty insurance
Slide 18: Strong Core Performance
NYSE: PFS 1.25% 1.28% 1.47% 1.48% 1.53% Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q4 2024 Core PTPP ROAA (Annualized Core PTPP earnings/average assets) CORE PTPP ROAA(1) (1) See Appendix for a reconciliation of GAAP and non-GAAP financial measures. Strong Core Performance 18 14.87% 14.54% 19.21% 19.77% 20.31%
Slide 19: CRE to Total Risk-Based Capital
NYSE: PFS Guideline is 300% of Regulatory Capital CRE to Total Risk-Based Capital 20 485.9% 472.1% 468.4% 466.2% 460.8% 0.00% 100.00% 200.00% 300.00% 400.00% 500.00% 600.00% 12/31/23 03/31/24 06/30/24 9/30/2024 12/31/2024
Slide 20: 2025 Guidance
NYSE: PFS 2025 Guidance 21 Loans • 2025: 5% growth Deposits • 2025: 3% growth Borrowings • 2025: Balances expected to fluctuate based on loan, deposit and securities cash flows Net Interest Margin • 2025: 3.35% to 3.45% range Asset Quality • Current strong asset quality metrics, provision driven by
Slide 21: Appendix
APPENDIX
Slide 22: CRE Investment Portfolio by Property Type
NYSE: PFS As of 12/31/24 ($ in thousands) CRE Investment Portfolio by Property Type* 23 PROPERTY TYPE COUNT $ OUTSTANDING % OUTSTANDING WARR Multi-Family 1,057 3,441,967 31.95% 3.45 Retail 883 2,514,732 23.34% 3.38 Industrial 554 2,024,854 18.79% 3.48 Office 460 884,076 8.21% 3.73 Mixed 712 831,853
Slide 23: C&I Loans by NAICS Sector
NYSE: PFS C & I – (Includes owner occupied)* Loans by NAICS Sector – 12/31/24 24*Excludes Purchase Accounting Adjustments NAIC Industry Code Loan Count Exposure ($) Balance ($) Real Estate and Rental and Leasing 1,472 1,341,462,204 1,066,139,802 Health Care and Social Assistance 731 1,075,705,223 93
Slide 24: Construction Loans by NAICS Sector
NYSE: PFS Construction Loans by NAICS Sector – 12/31/24 25*Excludes Purchase Accounting Adjustments NAIC Industry Code Loan Count Exposure ($) Balance ($) Real Estate and Rental and Leasing 97 1,049,835,905 651,307,811 Construction 46 146,542,605 90,644,969 Health Care and Social Assistance 4 57,598
Slide 25: Non-GAAP Financial Measures
NYSE: PFS Note: The Company has presented the following non-GAAP (Generally Accepted Accounting Principles) financial measures because it believes that these measures provide useful and comparative information to assess trends in the Company’s results of operations and financial condition. Presentat
Slide 26: Non-GAAP Financial Measures
NYSE: PFS Note: The Company has presented the following non-GAAP (Generally Accepted Accounting Principles) financial measures because it believes that these measures provide useful and comparative information to assess trends in the Company’s results of operations and financial condition. Presentat
Slide 27: Non-GAAP Financial Measures
NYSE: PFS Note: The Company has presented the following non-GAAP (Generally Accepted Accounting Principles) financial measures because it believes that these measures provide useful and comparative information to assess trends in the Company’s results of operations and financial condition. Presentat
Slide 28: Q4 2024 Results Presentation
Q4 2024 RESULTS PRESENTATION
Provident Financial Services — Q4 2024 Earnings Presentation on 6ix