S&t Bancorp, Inc. · NASDAQ:STBA
S&t Bancorp — Q4 2024 Earnings Presentation
40 slides from S&t Bancorp's earnings presentation, Feb 11, 2025
Slide 1: Full Year and Fourth Quarter 2024
Christopher J. McComish Chief Executive Officer Mark Kochvar Chief Financial Officer Full Year and Fourth Quarter 2024
Slide 2: Forward Looking Statements and Risk Factors
Forward Looking Statements and Risk Factors This information contains or incorporates statements that we believe are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally relate to our financial condition, result
Slide 3: Corporate Profile
3 • Founded in Indiana, PA in 1902 • $9.7 billion in assets • $7.8 billion in deposits • $7.7 billion in loans • $1.5 billion market cap • Stock symbol: STBA Corporate Profile
Slide 4: Geographic Footprint
Geographic Footprint 4 Serving more than 225,000 customers in Pennsylvania and Ohio Footprint comprises 9.6 million people and 215,000 businesses 1,200 team members providing award- winning customer satisfaction at more than 70 locations Akron Columbus Philadelphia Harrisburg Pittsburgh Indiana
Slide 5: Awards
Awards Award-winning performance and employee engagement 5 Forbes America’s Best Midsize Employers S&T was honored as one of America’s Best Midsize Employers by Forbes and Statista in 2023 and 2024. This annual ranking is based on a survey of more that 170,000 U.S.-based workers at American companie
Slide 6: Strategic Path
6 Strategic Path VALUES PURPOSE DRIVERS Our Shared Future represents a journey that began three years ago focused on building a foundation that enables profitable and sustainable growth.
Slide 7: Performance Drivers and Targets
Performance Drivers and Targets 7 Enterprise Risk Management Talent & Engagement Deposit Franchise Loans/Deposits below median Cost of Deposits below median Core Profitability PPNR/Avg Assets top quartile NIM above median Asset Quality NCO/Loans below median NPA/Lns & OREO below median Valuation Pri
Slide 8: Strategic Priorities
Strategic Priorities Positioned to execute on customer growth strategies to improve operating leverage Maintain peer median asset quality enabling a greater focus on growth Strategically positioned to capitalize on targeted M&A opportunities
Slide 9: Organic Growth
Loan Highlights • Commercial and business banking pipelines double the size from one year ago • Commercial Banking team grew 15% in 2024 • Asset quality improvement allowed us to focus on growth Future Opportunities • Continue expanding our business and commercial banking teams and capabilities • Gr
Slide 10: Mergers & Acquisitions
10 M&A Target Priorities • Existing or contiguous market expansion with institutions $1 ~ $6 billion in assets • Enhancement of deposit franchise • Access to growing markets • Alignment of cultures S&T Preparedness • Record levels of capital • Strong performer with solid return metrics • Infrastruct
Slide 11: Asset Quality
Asset Quality 11 0.23% 1.80% 2.92% (*) Criticized and Classified Peer data as of September 30, 2024 1.32% 14.41% Maintain peer median asset quality enabling a focus on growth Asset Quality Highlights • Asset quality improvement positively impacted earnings in 2024 with minimal provision for credit l
Slide 12: Full Year Overview
12 Full Year Overview RETURN METRICS EARNINGS *Refer to appendix for reconciliation of non-GAAP financial measures EPS $3.41 Net Income $131.3 million ROA 1.37% ROE 9.86% ROTE* 13.84% PPNR* 1.77% HIGHLIGHTS • Solid return metrics • Positioned for growth with strong capital levels • Strong NIM of 3.8
Slide 13: Fourth Quarter Overview
13 Fourth Quarter Overview RETURN METRICS EARNINGS Net Income $33.1 million *Refer to appendix for reconciliation of non-GAAP financial measures EPS $0.86 ROA 1.37% ROE 9.57% ROTE* 13.25% PPNR* 1.72% HIGHLIGHTS • Solid return metrics • Strong NIM at 3.77% • Total deposit growth of $128.3 million wit
Slide 14: Performance
PPNR / AVERAGE ASSETS * 2020 2021 2022 2023 2024 0.0% 0.6% 1.2% 1.8% 2.4% RETURN ON AVERAGE TANGIBLE EQUITY * 2020 2021 2022 2023 2024 0.0% 5.0% 10.0% 15.0% 20.0% RETURN ON AVERAGE EQUITY 2020 2021 2022 2023 2024 0.0% 5.0% 10.0% 15.0%RETURN ON AVERAGE ASSETS 2020 2021 2022 2023 2024 0.0% 0.4% 0.8% 1
Slide 15: Balance Sheet
Balance Sheet • Strong customer deposit growth of $78.3 million (4.15% annualized) • Reduction in borrowings of $88.1 million • Loan growth of $53.9 million impacted by significant pay-offs; positive momentum in loan pipelines Dollars in millions 15 4Q24 3Q24 Var $ 245 $ 228 $ 17 988 1,011 (23) 7,74
Slide 16: Loan Mix
Loan Mix Our loan portfolio is well-diversified: Dollars in millions 16 Amount % of Total CRE $3,388 44% Consumer 2,462 32% C&I 1,540 19% Construction 353 5% Total $7,743 100%
Slide 17: CRE Maturities
CRE Maturities Dollars in millions 17 CRE MATURITIES BY SIZE: CRE MATURITIES BY INDUSTRY: Size Total # Loans Avg Size 10mm+ $234.4 15 $15.6 5mm-10mm 192.7 27 7.1 1mm-5mm 256.2 110 2.3 Under 1mm 52.8 233 0.2 Total $736.1 385 $1.9 in next 24 months CRE MATURITIES BY QUARTER: Only 22% of our CRE loans
Slide 18: Office CRE
Office CRE Dollars in millions 18 CBD 15% $72 OFFICE LOANS BY SIZE: Size Total # Loans Avg Size Avg LTV 10mm+ $61.3 5 $12.3 60 % 5mm-10mm 143.2 21 6.8 56 % 1mm-5mm 166.7 79 2.1 59 % Under 1mm 82.1 324 0.3 49 % Total $453.3 429 $1.1 56 % OFFICE LOAN MATURITIES BY YEAR: Avg LTV: 55% 52% 62% 51% 63% OF
Slide 19: Multifamily CRE
Multifamily CRE Dollars in millions 19 MULTIFAMILY LOANS BY SIZE: Size Total # Loans Avg Size Avg LTV 10mm+ $180.2 12 $15.0 65 % 5mm-10mm 141.1 20 7.1 55 % 1mm-5mm 182.9 88 2.1 53 % Under 1mm 135.9 469 0.3 58 % Total $640.1 589 $1.1 58 % MULTIFAMILY LOAN MATURITIES BY YEAR: Avg LTV: 53% 57% 50% 56%
Slide 20: Asset Quality
Asset Quality ACL Trend: Dollars in millions 20 ASSET QUALITY TRENDS • ACL down 5 basis points to 1.31% compared to 1.36% at September 30, 2024 • Net loan recoveries of $0.1 million • NPAs decreased 5 basis points to 0.36% of total portfolio loans plus OREO % o f A verage Lo ans Net Loan Charge-Offs
Slide 21: Deposit Mix
Deposit Mix We have a strong, well-diversified deposit base of more than 200,000 customers: Dollars in millions 21 Amount % of Total DDA $2,185 28% MM 2,040 26% CDs 1,867 24% Savings 878 12% Int Bear DDA 813 10% Total $7,783 100% Amount % of Total Average Account Size (in $000) Average Age (in years
Slide 22: Funding Sources
FUNDING SOURCES Funding Capacity • Strong liquidity position with well-diversified deposit base • Significant funding availability through FHLB and Federal Reserve • Insured and collateralized municipal deposits comprise 70% of total deposits • Funding availability meets liquidity needs in both norm
Slide 23: Net Interest Income
• NIM remains strong; decreased 5 basis points • Cost of funds improved 11 basis points due to deposit rate cuts and reduced levels of borrowings • December 2024 NIM was 3.78% Net Interest Income Dollars in millions; *Refer to appendix for reconciliation of non-GAAP financial measures 23 $85.1 $83.5
Slide 24: Noninterest Income
4Q24 4Q24 vs 3Q24 4Q24 vs 4Q23 Debit and Credit Card $4.6 ($0.1) $0.1 Service Charges 4.2 — — Wealth 3.2 0.1 0.1 Security Loss (2.6) (0.4) (2.6) Other 1.7 (0.4) (4.6) Noninterest Income $11.1 ($0.8) ($7.0) Noninterest Income 24Dollars in millions • Security Loss of $2.6 million related to reposition
Slide 25: Noninterest Expense
4Q24 4Q24 vs 3Q24 4Q24 vs 4Q23 Salaries & Benefits $30.8 ($0.5) ($0.1) Data Processing 5.3 0.3 0.8 Occupancy 3.8 (0.1) 0.2 FF&E 3.3 (0.1) (0.5) Other Taxes 2.3 0.4 0.4 Marketing 1.6 0.2 0.2 Professional Services 1.1 (0.1) (0.9) FDIC 1.0 — — Other 6.2 (0.1) (0.9) Noninterest Expense $55.4 $0.0 ($0.8)
Slide 26: Securities
Securities 26 • Repositioned $143.3 million of securities in 2024 resulting in $7.9 million loss; will drive $4.0 million higher net interest income in 2025 • Securities portfolio is only 10% of total assets • 100% of securities portfolio is classified as available for sale • Average duration of 3.9
Slide 27: Capital
Capital Dollars in millions; *Refer to appendix for reconciliation of non-GAAP financial measures 27 TCE / TA* • We have strong capital levels and are well positioned for growth • TCE / TA down slightly from prior quarter due to higher AOCI 9.88% 10.03% 10.21% 10.86% 10.82% 4Q23 1Q24 2Q24 3Q24 4Q24
Slide 28: Income Statement
Income Statement 2024 2023 2022 2021 2020 2020 Dollars in thousands, except for share data Excludes Fraud (1) Net Interest Income $334,806 $349,410 $315,783 $276,112 $279,388 Noninterest Income 49,083 57,620 58,259 64,696 59,746 Total Revenue 383,889 407,030 374,042 340,808 339,134 Noninterest Expen
Slide 29: Financial Data: Balance Sheet
Financial Data 29 Balance Sheet 2024 2023 2022 2021 2020 Dollars in thousands Total Securities $987,591 $970,391 $1,002,778 $910,793 $773,693 Cash and Interest-bearing Deposits 244,820 233,612 210,009 922,215 229,666 Total Net Loans 7,641,464 7,545,528 7,082,645 6,902,936 7,126,776 Other Assets 784,
Slide 30: Net Interest Margin
Net Interest Margin 2024 2023 2022 2021 2020 Securities - FTE(1) 3.05% 2.61% 2.25% 2.18% 2.49% Loans - FTE(1) 6.24% 6.04% 4.50% 3.84% 4.09% Total Interest-earning Assets - FTE(1) 5.87% 5.64% 4.06% 3.37% 3.87% Interest-bearing Deposits 2.92% 1.92% 0.40% 0.20% 0.66% Borrowings 5.41% 5.59% 3.01% 1.49%
Slide 31: Financial Data: Loan Portfolio
Financial Data 31 Loan Portfolio 2024 2023 2022 2021 2020 Dollars in thousands Commercial Real Estate $3,388,017 $3,357,603 $3,128,187 $3,236,653 $3,244,974 Commercial and Industrial 1,540,397 1,642,106 1,718,976 1,728,969 1,954,453 Commercial Construction 352,886 363,284 399,371 440,962 474,280 Tot
Slide 32: Asset Quality
Asset Quality 2024 2023 2022 2021 2020 Dollars in thousands Total Nonaccrual Loans $27,937 $22,946 $19,052 $66,291 $146,774 Nonaccrual Loans/Total Loans 0.36% 0.30% 0.27% 0.95% 2.03% Nonperforming Assets/Total Loans + OREO 0.36% 0.30% 0.31% 1.13% 2.06% Net Charge-offs/Average Loans 0.11% 0.18% 0.04%
Slide 33: Capital
Capital 2024 2023 2022 2021 2020 Tier 1 Leverage 11.98% 11.21% 11.06% 9.74% 9.43% Common Equity Tier 1 – Risk-Based Capital 14.58% 13.37% 12.81% 12.03% 11.33% Tier 1 – Risk-Based Capital 14.90% 13.69% 13.21% 12.43% 11.74% Total – Risk-Based Capital 16.49% 15.27% 14.73% 13.79% 13.44% Tangible Common
Slide 34: Definitions of GAAP to Non-GAAP Financial Measures (4Q24)
4Q24 Return on Average Tangible Shareholders' Equity (ROTE) (non-GAAP) Net income (annualized) $131,541 Plus: amortization of intangibles (annualized), net of tax 858 Net income before amortization of intangibles (annualized) $132,399 Average total shareholders' equity $1,374,907 Less: average goodw
Slide 35: TCE/Tangible Assets and Efficiency Ratio
4Q24 3Q24 2Q24 1Q24 4Q23 Tangible Common Equity (TCE)/Tangible Assets (non-GAAP) Total shareholders' equity $1,380,294 $1,375,754 $1,321,443 $1,295,074 $1,283,445 Less: goodwill and other intangible assets, net of deferred tax liability (375,837) (375,931) (376,154) (376,396) (376,631) Tangible comm
Slide 36: Definitions of GAAP to Non-GAAP Financial Measures
2020 Excludes Fraud Net Income Excluding Nonrecurring items Net income $21,040 Nonrecurring items 58,671 Tax effect of nonrecurring items (12,321) Adjusted net income (non-GAAP) $67,390 Diluted Earnings Per Share Adjusted net income (non-GAAP) $67,390 Average shares outstanding - diluted 39,073 Dilu
Slide 37: Return on Average Tangible Shareholders' Equity
2024 2023 2022 2021 2020 2020 Excludes Fraud Return on Average Tangible Shareholders' Equity (ROTE) (non-GAAP) Net income $131,265 $144,781 $135,520 $110,343 $21,040 $21,040 Nonrecurring items — — — — — 58,671 Tax effect of nonrecurring items — — — — — (12,321) Adjusted net income (non-GAAP) $131,26
Slide 38: PPNR/Average Assets (Non-GAAP)
2024 2023 2022 2021 2020 2020 Excludes Fraud PPNR/Average Assets (Non-GAAP) Income before taxes $164,818 $178,804 $168,930 $135,668 $21,039 Less: net losses (gains) on sale of securities 7,938 — (198) (29) (142) Less: gain on Visa Class B-1 exchange (3,492) — — — — Plus: provision for credit losses
Slide 39: Interest Income and NIM Reconciliation
2024 2023 2022 2021 2020 Interest and Dividend Income Interest-bearing deposits with banks $8,855 $7,344 $2,952 $973 $515 Securities 29,665 25,207 22,449 17,432 18,060 Loans 476,083 442,675 314,774 270,460 300,960 Other earning assets 1,269 2,675 576 397 929 Total Interest and Dividend Income $515,8
Slide 40: Full Year and Fourth Quarter 2024
Christopher J. McComish Chief Executive Officer Mark Kochvar Chief Financial Officer Full Year and Fourth Quarter 2024