Peapack-gladstone Financial Corporation · NASDAQ:PGC
Peapack-gladstone Financial — Q4 2020 Earnings Presentation
34 slides from Peapack-gladstone Financial's earnings presentation, Feb 1, 2021
Slide 1: Q4 2020 Investor Update (and Supplemental Financial Information)
Q4 2020 Investor Update (and Supplemental Financial Information) 12.31.2020 Peapack-Gladstone Bank The Q4 2020 Investor Update (and Supplemental Financial Information) should be read in conjunction with the Q4 2020 Earnings Release issued on February 1, 2021 Exhibit 99.1
Slide 2: Statement Regarding Forward-Looking Information
Statement Regarding Forward-Looking Information This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are not historical facts and may include expressions about Management’s strategies and Management’s expect
Slide 3: Investment Considerations
Current valuation creates a buying opportunity given its discounted valuation relative to peers. Proven management team with track record of success. Attractive geographic franchise. PGC operates in some of the most affluent counties in the U.S. Highly efficient branch network with deposit balances
Slide 4: Relative Trading Valuation Compared to Peers
Relative Trading Valuation Compared to Peers As of January 26, 2021 4 *Tangible book value at December 31, 2020 is $25.47. See Non-GAAP financial measures reconciliation table. Source: S&P Global Market Intelligence Wealth peers include: Tompkins Financial Corporation, Univest Financial Corporation,
Slide 5: Franchise Overview and Branch Map
Financial Highlights 1 Branch Map Franchise Overview 5 Private Banking Offices Bedminster, NJ Morristown, NJ Princeton, NJ Teaneck, NJ Bonita Springs, FL Greenville, DE (Trust Subsidiary) New Providence, NJ Summit, NJ We Operate in 3 of the Top 10 Wealthiest Counties in the United States 2 1 Financi
Slide 6: Strategy and Business Lines Overview
Emphasis on commercial banking with private bankers focused on providing high-touch client service through an advice-based approach encompassing commercial and industrial (C&I) lending, wealth management, depository services, electronic banking, other commercial real estate lending, and corporate ad
Slide 7: Wealth Management Highlights Q4 and YTD 2020
Q4 and YTD 2020: AUMs/AUAs at 12/31/2020 were a record $8.8B, which includes YTD gross client inflows of more than $600MM. Wealth fees totaled $41MM in 2020 reflecting an increase of $2.5MM (7%) vs 2019. Wealth fees were up $671K (7%) for Q4 2020 vs Q4 2019. Wealth fee revenue comprised 22% of total
Slide 8: Wealth Management and Other Fees Provide a Diversified Revenue Mix
* Includes SBA Income, Swap Income, Deposit & Loan Fees, Mortgage Banking, and BOLI. Net Interest Income 67% Wealth Management Fees 22% Fees & Other Income 11% Twelve Months Ended 12/31/2020 Net Interest Income before Provision Wealth Management Fee Income Fees & Other Income* 8 Total Non-Interest I
Slide 9: Diversified Loan Portfolio
9 Diversified Loan Portfolio Gross Loans: $4.4 billion Note: Gross loans include loans held for sale; C&I includes Owner-Occupied CRE, which was 6% of the total loan portfolio as of 12/31/2020 Loan Mix as of 12/31/2020 Historical Loan Composition
Slide 10: Diversification within C&I Lending
Diversification within C&I Lending As of 12/31/2020 10 C&I loans (excluding PPP loans) constitute 40% of the total loan portfolio DSCR 1.25x Current Deferrals 1.26% 30-89 Days Past Due 0.07%
Slide 11: High Quality Diversified Multifamily Loan Portfolio
High Quality Diversified Multifamily Loan Portfolio As of 12/31/2020 11 Avg. Loan Size $3.2MM LTV 59.0% DSCR 1.63x Debt Yield 10.3% Current Deferrals 2.00% 30-89 Days Past Due 0.02% Multifamily loans constitute 26% of the total loan portfolio
Slide 12: A Well-Diversified Non-Owner Occupied CRE Portfolio
12 A Well-Diversified Non-Owner Occupied CRE Portfolio As of 12/31/2020 Non-Owner Occupied CRE loans constitute 16% of the total loan portfolio Avg. Loan Size $2.3MM LTV 54.7% DSCR 1.67x Debt Yield 13.1% Current Deferrals 2.94% 30-89 Days Past Due 0.04%
Slide 13: Deferrals within Sectors with Elevated COVID Residual Risk
13 Deferrals within Sectors with Elevated COVID Residual Risk Estimated at less than 1% of Total Loans “Highly Impacted” residual sectors highlighted in green Overall The sectors designated by management to have elevated COVID residual risk total $301MM, ~7% of Total Loans (as of 12/31/20). Only ~8%
Slide 14: Asset Quality Remains Strong throughout Roll-off of COVID-19 Deferrals
14 Asset Quality Remains Strong throughout the Rapid Roll-off of COVID-19 Related Deferrals 30-89 Days Past Due $5.1MM (0.12% of Total Loans)
Slide 15: Historically Strong Credit Quality
NPAs / Assets (%)* ALLL / Non-Performing Loans (%) NCOs / Average Loans (%) ALLL / Gross Loans (%) Historically Strong Credit Quality 15 *Excludes restructured loans of $8.5MM HFS at December 31, 2020.
Slide 16: Despite COVID, Classified Loans Have Declined
16 $58.9 MM $37.8 MM ($21.6) MM ($12.6) MM $13.1 MM Despite COVID, Classified Loans Have Declined 1.34% of total gross loans 0.86% of total gross loans
Slide 17: Loans with Elevated COVID Residual Risk Drive Growth in Special Mention
17 Loans with Elevated COVID Residual Risk Largely Drive Growth in Special Mention (Criticized) $13.6 MM $162.1 MM ($7.7) MM $36.7 MM $52.1 MM $19.9 MM $47.5 MM LTV = 52% DSCR = 1.60x LTV = N/A DSCR = 1.92x LTV = 61% DSCR = 1.57x
Slide 18: Conservatively Built Reserves Based on Qualitative Factors
18 $43.7 MM $67.3 MM ($6.2) MM $11.5 MM $20.9 MM ($2.6) MM Conservatively Built Reserves Based on Qualitative Factors
Slide 19: Fortress Balance Sheet
Fortress Balance Sheet 19 1 Substantially all of the Bank's loans and securities are pledged for back up liquidity purposes. 2 Net of $15m of term borrowing. 3 Excludes securities, the majority of which are pledged against secured funding.
Slide 20: Stock Repurchase Program Authorized
Stock Repurchase Program Authorized 20 5% Stock Repurchase Program authorized by the Board on 01/28/2021. 948,735 shares authorized to be repurchased. Program open through 03/31/2022. Program justified by the Company’s: strong capital position (verified by Stress Test) ALLL coverage and strong and s
Slide 21: Net Interest Margin Has Stabilized and is Positioned to Improve in 2021
Core NIM (%) NIM (as reported) (%) 21 Net Interest Margin Has Stabilized and is Positioned to Improve in 2021 Margin improved in Q4 2020 compared to Q3 2020. Expect gradual improvement each quarter over 2021. Benefits to margin: Deposit costs strategically managed down, justified by our private bank
Slide 22: Continued Improvement in Core Low-Cost Funding
22 Continued Improvement in Core Low-Cost Funding Historical Deposit Composition – Quarter Ended 12/31/19 03/31/20 06/31/20 09/30/20 12/31/20 1.34% 1.21% 0.74% 0.55% 0.48% Cost of Interest-Bearing Deposits:
Slide 23: We Remain Asset Sensitive and Will Benefit from Increased Rates
23 We Remain Asset Sensitive and Will Benefit from Increased Rates As of 12/31/2020 Net Interest Income 1 Year Impact (%) Net Interest Income 2 Year Impact (%) Note: Based on a 12 and 24 month simulation. Although the simulation provides an indication of our interest rate exposure at a particular po
Slide 24: Investing in the Client Experience through Digital Transformation
Investing in the Client Experience through Digital Transformation 24
Slide 25: Priorities
Actively deploy/manage capital and liquidity by expanding our lending activities and execution on our recently announced stock repurchase program. Grow and expand our core Wealth Management and Commercial Banking businesses, including lift-outs, strategic hires, and acquisition of wealth management
Slide 26: Appendix
Appendix Peapack-Gladstone Bank
Slide 27: Vision
A high-performing boutique bank, leaders in wealth, lending and deposit solutions, known nationally for our unparalleled client service, integrity and trust. Professionalism Clients First Compete to Win Invested in Our Community One Team Vision 27 Senior Private Bankers lead a team-based approach. P
Slide 28: Historical Balance Sheet Growth
Total Loans (in billions)* Total Assets (in billions)* Shareholders Equity (in millions) Total Deposits (in billions) Historical Balance Sheet Growth 28 *12/31/2020 includes PPP loans of $196 million in total loans.
Slide 29: Quarterly Capital Stress Testing
29 Quarterly Capital Stress Testing run under multiple scenarios based on Loan Risk Ratings. In the 09/30/20 severely adverse case, no growth scenario, the Bank remains well capitalized over a two-year stress period. Severely adverse case major assumptions: GDP growth -5.9% Unemployment 12.5% Declin
Slide 30: Quarterly Income Statement Summary
Quarterly Income Statement Summary (Dollars in thousands, except per share data) 30 1 Includes gain on sale of $7.4 million for the sale of $355 million in PPP loans for the quarter ended September 30, 2020. 2 The December 2020 quarter included a $4.8 million FHLB prepayment penalty, a $4.4 million
Slide 31: Asset Quality
Asset Quality 31 1 Excludes residential and commercial loans held for sale of $8.5 million at December 31, 2020. Excludes one commercial loan held for sale of $10.0 million at September 30, 2020. 2 Amounts reflect TDRs that are paying according to restructured terms. 3 Amount does not include $4.0 m
Slide 32: Capital Summary
Capital Summary 32 1 PPP loans with a balance of $196 million and $202 million increased total assets at December 31, 2020 and September 30, 2020, respectively. Equity to total assets would be 9.26% and 9.08% if PPP loans were excluded from total assets at December 31, 2020 and September 30, 2020, r
Slide 33: Non-GAAP Financial Measures Reconciliation
Non-GAAP Financial Measures Reconciliation (Dollars in thousands, except per share data) 33 We believe that these non-GAAP financial measures provide information that is important to investors and that is useful in understanding our financial position, results and ratios. Our management internally a
Slide 34: Contacts
Peapack-Gladstone Financial Corporation 500 Hills Drive, Suite 300 P.O. Box 700 Bedminster, New Jersey 07921 (908) 234-0700 www.pgbank.com Douglas L. Kennedy President & Chief Executive Officer (908) 719-6554 dkennedy@pgbank.com Jeffrey J. Carfora Senior EVP & Chief Financial Officer (908) 719-4308
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