Prosperity Bancshares, Inc. · NYSE:PB
Prosperity Bancshares — Q1 2022 Earnings Presentation
28 slides from Prosperity Bancshares's earnings presentation, Apr 27, 2022
Slide 1: Investor Presentation First Quarter 2022
Investor Presentation First Quarter 2022
Slide 2: “Safe Harbor” Statement
“Safe Harbor” Statement Under the Private Securities Litigation Reform Act of 1995 “Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995: This presentation contains forward-looking statements within the meaning of the federal securities laws, including Section 27A of the
Slide 3: First Quarter Highlights
First Quarter Highlights • Net income of $122.3 million and earnings per share (diluted) of $1.33 for three months ended March 31, 2022 • Assets of $38.3 billion, total loans of $18.1 billion, and deposits of $31.1 billion at March 31, 2022 • Common equity tier 1 ratio of 15.32% and leverage ratio o
Slide 4: Strong Presence in Texas and Oklahoma
Strong Presence in Texas and Oklahoma • A Texas-based financial holding company with $38.3 billion in total assets • Prosperity has been ranked in the Top 10 of Forbes America’s Best Oklahoma INTERSTATE 44 Banks since the list’s inception in 2010 INTERSTATE 35 Tulsa • Ranked #3 in deposit market sha
Slide 5: Balance Sheet Summary
Balance Sheet Summary 0,000 ,000 Data as of 03/31/2022 Total Loans $18.1 Bn ,000 Deposits $31.1 Bn ,000 Assets $38.3 Bn 0,000 10 Year CAGR (1) ,000 Loans 17.3% 2 ,000 Deposits 14.3% Assets 14.4% ,000 20,000 ,000 1 ,000 2,000 10,000 1,000 ,000 0 0 2011 2012 201 201 201 201 201 201 201 2020 2021 1 21
Slide 6: Net Income
Net Income 00 0 10 Year CAGR:(1) 13.9% 00 0 5 Year CAGR:(2) 13.6% 00 0 00 0 200 0 100 0 00 (3) 2011 2012 201 201 201 201 201 201 201 2020 2021 1 21 1 22 Note: Net income includes the following ($ in thousands) Provision for Credit $5,200 $6,100 $17,240 $18,275 $7,560 $24,000 $14,325 $16,350 $4,300 $
Slide 7: Earnings Per Share
Earnings Per Share 10 Year EPS CAGR:(1) 6.4% 00 5 Year EPS CAGR:(2) 7.3% 00 00 00 2 00 1 00 0 00 (3) 2011 2012 201 201 201 201 201 201 201 2020 2021 1 21 1 22 Note: Net income includes the following ($ in thousands) Provision for Credit $5,200 $6,100 $17,240 $18,275 $7,560 $24,000 $14,325 $16,350 $4
Slide 8: Net Interest Margin
Net Interest Margin 0 00 0 00 2 0 2011 2012 201 201 201 201 201 201 201 2020 2021 1 21 1 22 Net Interest Margin (Tax Equivalent) Net Interest Margin (Excluding Purchase Accounting Adjustments) 8 Source: Company Documents
Slide 9: Acquisitions & Efficiency Ratio
Acquisitions & Efficiency Ratio ,000 100 0 0,000 ,2 1 00 , , ,0 00 ,000 2,1 00 0,000 00 2 ,000 22, 22,0 22, 1 22, 21, 0 00 20,000 1 , 2 00 1 ,000 1 , 00 , 2 10,000 20 0 ,000 10 0 0 00 (3) 2011 2012 201 201 201 201 201 201 201 2020 2021 1 21 1 22 % of Assets Acquired 0.0% 23.7% 20.9% 11.2% 0.0% 2.5%
Slide 10: Return on Average Tangible Common Equity
Return on Average Tangible Common Equity 0 00 , 00 0 00 2, 0 20 00 1, 00 10 00 0 0 00 (2) (1) (1) 0 2011 2012 201 201 201 201 201 201 201 2020 2021 1 21 1 22 ROATCE Tangible Common Equity (1) Interim periods shown on an annualized basis 10 (2) Includes NOL tax benefit of $20.145 million related to t
Slide 11: Return on Average Assets
Return on Average Assets 2 00 1 1 0 12 1 00 0 (2) (1) (1) 2011 2012 201 201 201 201 201 201 201 2020 2021 1 21 1 22 (1) Interim periods shown on an annualized basis 11 (2) Includes NOL tax benefit of $20.145 million related to the CARES Act
Slide 12: Deposit Composition
Deposit Composition As of March 31, 2022 ($ in millions) Noninterest-Bearing Deposit Growth C s ther Time 2 Year CAGR: 20.2%(2) 10 10 10 2 10 1 0 0 2 oninterest Bearing emand oney arket Savings 9.7% Increase YoY 44.4% Increase Over Past 8 Quarters nterest Bearing emand 21 2 1 20 2 20 20 20 1 21 2 21
Slide 13: Loan Growth
Loan Growth 22,000 100 0 1 , 00 2 2, 2 2,2 2 1, 1, 1 , 00 1, 0 1 ,2 1 , 0 1 , 1 , 0 1 , 2 1 , 00 1 ,200 00 0 2 11,000 2 0 , 00 0 , 00 , 00 00 2,200 2 0 2 0 2011 2012 201 201 201 201 201 201 201 2020 2021 1 21 1 22 Loans (Excluding Warehouse Purchase Program) Loan / Deposit Ratio (Excluding WPP) Ware
Slide 14: Loan Portfolio Overview
Loan Portfolio Overview As of March 31, 2022 ($ in millions) Loan Portfolio by Category & Geography Loans by Rate Structure PPP oans Agriculture ( nc Farm) 0 PP 1 1, Energy 1 Family C , 1 Fixed Floa ng 2 2,00 2 1 11 1 ~2.8yr Avg. Life Home E uity Comm E 0 ,1 1 2 Construc on 2, 2 ariable ate 12 Consu
Slide 15: Loan Portfolio Detail
Loan Portfolio Detail As of March 31, 2022 ($ in millions) Portfolio Commentary Commercial Real Estate Detail ($ in millions) • 33% of commercial real estate is owner occupied ommer a Retail $1,254 24% n tr a • CRE and construction loans conservatively e Office $912 18% underwritten to cost of colla
Slide 16: Energy Portfolio Detail
Energy Portfolio Detail As of March 31, 2022 ($ in millions) Energy Detail - Outstanding Balance Portfolio Commentary ($ in millions) • Total energy loan loss reserves of 4.2%, or $18.6 million (excluding fair value marks)(1) Ser e ro er • $11.2 million, or 2.5% of energy loans, are subject to $446m
Slide 17: Changes to Allowance for Credit Losses
Changes to Allowance for Credit Losses ($ in millions) 1.72% ACL to Total 1.71% ACL to Total Loans (1) Loans (1) Allowance for ▪ Net increased reserve Allowance for ▪ Net Charge-offs ▪ Outstanding Credit Losses related to changes in Credit Losses ▪ PCD recoveries balances macro-economic ▪ $0.6 milli
Slide 18: Asset Quality
Asset Quality NPAs / Loans + OREO 00 00 00 00 2 00 1 00 0 00 200 200 200 2010 2011 2012 201 201 201 201 201 201 201 2020 2021 1 21 1 22 UBPR Peer Group (1) Prosperity Bank Source: Company Documents & Uniform Bank Performance Report 18 Note: NPAs include loans past due 90 days and still accruing (1)
Slide 19: Asset Quality: Net Charge-Offs / Average Loans
Asset Quality Net Charge-Offs / Average Loans 2 00 1 0 1 00 0 0 (2) 0 00 ($ in millions) (2) Recoveries Charge-Offs 200 200 200 2010 2011 2012 201 201 201 201 201 201 201 2020(3) 2021(3) 1 21 1 22 Net 1 2 1 1 20 1 1 1 0 (3) 2 1 2 12 (3) 200 200 200 2010 2011 2012 201 201 201 201 201 201 201 2020 202
Slide 20: Securities Portfolio Detail
Securities Portfolio Detail As of March 31, 2022 ($ in millions) ther Securi es 01 States $mm Poli cal Mortgage-Backed Securities $13,996 Subdivisions ortgage 0 Collateralized Mortgage Obligations $666 Backed Securi es Collaterali ed States & Political Subdivisions $124 ortgage bliga ons Other Secur
Slide 21: Dividend History
Dividend History 22 (d) (c) 2 00 om o n e nn a ro t ate from a (b) 1 (a) 1 0 12 1 00 0 en H tor 0 0 02 Q1 Q2 Q3 Q4 (Declared) 0 00 200 200 200 200 200 200 200 2010 2011 2012 201 201 201 201 201 201 201 2020 2021 21 (a) 2021 dividend consists of $0.49 per share declared in Q1 2021, 2Q 2021, 3Q 2021 a
Slide 22: Total Return Performance
Total Return Performance IPO (November 12, 1998) to March 31, 2022 2,000 n e te n ro er t ’ 1,800 on 11/12/98 was worth $1,615,147 on 3/31/22 1,600 1,400 1,200 1,000 800 600 400 200 0 11/12/98 11/12/00 11/12/02 11/12/04 11/12/06 11/12/08 11/12/10 11/12/12 11/12/14 11/12/16 11/12/18 11/12/20 PB (+1,6
Slide 23: Presence in Fast-Growing Markets
Presence in Fast-Growing Markets Positioned in Strong Markets Top 10 Fastest Growing MSAs in the U.S. (1) Prosperity 2022 - 2027 • Today, Texas is the 2nd largest Prosperity Deposits Population state in the U.S by population Metropolitan Statistical Area Presence ($mm) Growth Lubbock Lubbock Lubbock
Slide 24: Corporate Relocations to Texas
California Aatonomy Corporate Relocations to Texas AccentCare Active Networks AEND Industries, Inc. AECOM The Allen Group, Inc. Allied Electronic Recycling AllyMe Group, Inc. ALL-Q-TELL Corp. Corporate Relocations to Texas (2004 – Present) Amazing Magnets Ameriflight LLC Canada Aviat Networks, Inc.
Slide 25: Houston Market Highlights
Houston Market Highlights Market Highlights Houston Franchise • Houston MSA is the 5th largest in the United States by population with nearly 7.3 million residents – Population is expected to grow 6.0% from 2022 to 2027 • Headquarters to 24 Fortune 500 companies – Home to the Texas Medical Center –
Slide 26: Dallas/Ft. Worth Market Highlights
Dallas/Ft. Worth Market Highlights Market Highlights Dallas / Ft. Worth Franchise • Dallas/Ft. Worth MSA is the 4th largest in the United States by population with over 7.8 million residents – Population is expected to grow 5.9% from 2022 to 2027 • As of March 2022, total nonfarm employment has incr
Slide 27: Austin Market Highlights
Austin Market Highlights Market Highlights Austin Franchise Franchise • Ranked #5 place to live in the U.S. in 2021 by U.S. News and World Report • Expected population growth of 6.9% through 2027, the second highest INTERSTATE 35 of any major MSA in the country • Ranked as the best city in the U.S.
Slide 28: Contact Information
Contact Information Corporate Headquarters Investor Contacts Prosperity Bank Plaza David Zalman 4295 San Felipe Chairman & CEO Houston Texas 77027 979-543-2200 david.zalman@prosperitybankusa.com 281-269-7199 Telephone Cullen Zalman SVP – Banking & Corporate Activities 281-269-7176 cullen.zalman@pros
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