Western Alliance Bancorporation · NYSE:WAL
Western Alliance Bancorporation — Q4 2018 Earnings Presentation
17 slides from Western Alliance Bancorporation's earnings presentation, Jan 24, 2019
Slide 1: Earnings Call 4th Quarter 2018
EARNINGS CALL 4th QUARTER 2018 January 25, 2019
Slide 2: Financial Highlights Q4 2018
Financial Highlights Q4 2018 • Net income of $119.1 million ($1.13 per share), compared to $111.1 million ($1.05 per share) for Q3 2018, and $89.3 million ($0.85 per share) for Q4 2017 • Net interest margin of 4.72%, flat from Q3 2018, and a decrease from 4.73% in Q4 2017 • Operating efficiency rati
Slide 3: Quarterly Consolidated Financial Results
Quarterly Consolidated Financial Results $ in millions, except EPS Q4 2018 Highlights Q4-18 Q3-18 Q4-17 Interest Income $ 282.0 $ 265.2 $ 228.5 • Net Interest Income increased $9.5 million primarily as a result of loan Interest Expense (38.5) (31.2) (17.4) growth, partially offset by higher rates Ne
Slide 4: Annual Consolidated Financial Results
Annual Consolidated Financial Results $ in millions, except EPS 2018 Highlights 2018 2017 Interest Income $ 1,033.5 $ 845.5 • Net Interest Income increased $131.2 million as a result of loan growth, Interest Expense (117.6) (60.8) partially offset by higher rates on Net Interest Income $ 915.9 $ 784
Slide 5: Net Interest Drivers
Net Interest Drivers $ in billions, unless otherwise indicated Total Investments and Yield Loans and Yield Q4 2018 Highlights 5.90% 5.97% • Loan yield increased 7 basis 5.72% 5.81% 3.49% 5.59% points due to rising interest 3.23% 3.24% © 3.15% 3.07% 5.62% rates across most loan types © • Cost of inte
Slide 6: Net Interest Income and Accretion
Net Interest Income and Accretion $ in millions Net Interest Income, NIM, and Q4 2018 Highlights Average Interest Earnings Assets • NIM was flat at 4.72% quarter-over-quarter $243.5 $224.1 $234.0 $211.0 $214.2 • Non-PCI accretion increased $1.5 million due to 4.73% 4.72% 4.72% 4.60% 4.70% accelerate
Slide 7: Operating Expenses and Efficiency
Operating Expenses and Efficiency $ in millions Operating Expenses and Efficiency Ratio Q4 2018 Highlights 42.7% 41.7%© 42.1% 41.5% 41.5% • The operating efficiency ratio was flat at 41.5% compared to the prior quarter 40.7% • Operating expenses increased from the prior quarter primarily due to incr
Slide 8: Operating Pre-Provision Net Revenue, Net Income, and ROA
Operating Pre-Provision Net Revenue, Net Income, and ROA $ in millions Highlights • Return on assets continued its upward trend, increasing 6 basis 2.61% 2.64% 2.65% points from the prior quarter and 34 2.57% 2.51% basis points, or 19.0%, from Q4-17 2.13% 1.99% 2.02% 2.07% • Operating PPNR ROA remai
Slide 9: Consolidated Balance Sheet
Consolidated Balance Sheet $ in millions Q4-18 Q3-18 Q4-17 Q4 2018 Highlights Investments & Cash $ 4,260 $ 4,334 $ 4,237 • Loans increased $978 million Loans 17,711 16,733 15,094 (5.8%) over prior quarter and $2.62 Allowance for Credit Losses (153) (150) (140) billion (17.3%) over prior year Other A
Slide 10: Five Quarter Loan Growth and Portfolio Composition
Five Quarter Loan Growth and Portfolio Composition $ in millions $2.62 Billion Year Over Year Growth Highlights $15,094 $15,560 $16,138 $16,733 $17,711 Quarter-over-quarter loan growth +572 +466 +578 +595 +978 driven by (in millions): Residential & Consumer $ 379 $1,275 7.2% C&I 275 $896 $600 CRE, N
Slide 11: Five Quarter Deposit Growth and Composition
Five Quarter Deposit Growth and Composition $ in millions $2.20 Billion Year Over Year Growth Highlights $16,973 $17,355 $18,088 $18,909 $19,177 Quarter-over-quarter deposit growth +68 +382 +733 +821 +269 driven by (in millions): Interest Bearing DDA $ 578 Savings and MMDA 272 $1,857 $1,835 9.6% $1,
Slide 12: Adversely Graded Loans and Non-Performing Assets
Adversely Graded Loans and Non-Performing Assets * $ in millions $379 $368 $355 $358 $316 $185 $150 $124 $155 $89 Adversely Graded Loans 1.85% 1.92% 1.83% 1.70% $177 1.43% $128 $127 $156 $181 $44 $37 $34 0.36% 0.33% 0.29% 0.26% NPAs $37 $28 0.20% $28 $30 $28 $20 $18 Q4-17 Q1-18 Q2-18 Q3-18 Q4-18 Q4-
Slide 13: Charge-Offs, Recoveries, ALLL, and Provision
Charge-Offs, Recoveries, ALLL, and Provision $ in millions Gross Charge-Offs and Recoveries ALLL and ALLL to Organic Loans Ratio $147 $150 $153 $140 $145 $4.8 $2.3 $3.6 $3.9 $4.1 1.03% $(2.2) $(1.7) 1.02% 0.99% 0.97% $(0.9) $(1.3) $(0.8) 0.92% Q4-17 Q1-18 Q2-18 Q3-18 Q4-18 Q4-17 Q1-18 Q2-18 Q3-18 Q4
Slide 14: Capital
Capital Capital Ratios ROTCE and TBV/Share 21.1% 20.5% 20.4% 20.6% 13.4% 13.5% 13.3% 13.2% 13.2% 18.8% 11.0% 10.9% 10.8% $22.07 10.5% 10.4% 10.9% $20.70 10.7% 10.7% 10.5% $19.78 $18.86 10.3% 10.2% $18.31 10.0% 9.8% 9.9% 9.6% Q4-17 Q1-18 Q2-18 Q3-18 Q4-18 Q4-17 Q1-18 Q2-18 Q3-18 Q4-18 Total Capital C
Slide 15: Management Outlook
Management Outlook • Loan and Deposit Growth • Interest Margin • Operating Leverage • Asset Quality 15 1515
Slide 16: Questions and Answers
WA Western Alliance Bancorporation’ Questions and Answers 16
Slide 17: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements that relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends, and similar expressions concerning matters that are not historical facts. Examples of forward-looking stateme
Western Alliance Bancorporation — Q4 2018 Earnings Presentation on 6ix