Bank Of N.t. Butterfield & Son Limited (the) Voting · NYSE:NTB
Bank Of N.t. Butterfield & Son Limited (the) Voting — The Bank of N.T. Butterfield & Son — Q1 2020 Earnings Presentation
24 slides from Bank Of N.t. Butterfield & Son Limited (the) Voting's earnings presentation, May 1, 2020
Slide 1: First Quarter Earnings Presentation
First Quarter Earnings Presentation The Bank of N.T. Butterfield & Son Limited May 1, 2020
Slide 2: Forward-Looking Statements
Forward-Looking Statements Forward-Looking Statements: Certain of the statements made in this release are forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. You can identify these forward-looking statements through our use of words such as “ma
Slide 3: Agenda and Overview
Agenda and Overview Presenters Agenda Butterfield Overview Michael Collins • Overview • Leading Bank in Attractive Markets Chairman and Chief Executive Officer • First Quarter 2020 Highlights • Strong Capital Generation and Return Michael Schrum • COVID-19 Update • Efficient, Conservative Balance Sh
Slide 4: First Quarter 2020 Highlights
First Quarter 2020 Highlights • Net income of $40.3 million, or $0.77 per share (In US$ millions) vs. Q4 2019 vs. Q1 2019 • Core Net Income** of $40.8 million, or $0.78 per share Q1 2020 $ % $ % • Return on average common equity of 16.6%; core return on average Net Interest Income $ 87.6 $ 1.4 $ (0.
Slide 5: COVID-19 Update
COVID-19 Update Initial Assessment/Community Actions Short-term Implications Medium/Long-term Implications • Business continuity/social distancing/remote • Tourism credit and revenue streams being • Sustained, ultra low interest rates would working implemented for staff closely monitored alter earni
Slide 6: Financials
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Slide 7: Income Statement: Net Interest Income
Income Statement Net Interest Income Net Interest Margin & Yields Net Interest Income before Provision for Credit Losses - Trend (In US$ millions) Q1 2020 vs. Q4 2019 (In US$ millions) Avg. Balance Yield Avg. Balance Yield $88.0 $86.2 $87.6 Cash, S/T Inv. & Repos $ 3,681.2 1.03 % $ (110.7) (0.11)% I
Slide 8: Customer Deposits
Customer Deposits Deposit Composition By Currency Average Deposit Volume and Cost of Deposits 6.1% 10.2% 8.8% 5,000 (In US$ millions) 14.7% 20.2% 21.4% 1.38% 1.41% 4,000 1.21% 79.2% 69.6% 69.8% 3,000 Q1 Q2 Q3 Q4 Q1 2019 2020 USD / USD Pegged GBP 2,000 Other 0.50% 0.42% 0.38% 1,000 0.25% 0.20% By Typ
Slide 9: Income Statement: Non-Interest Income
Income Statement Non-Interest Income Non-Interest Income Trend (In US$ millions) (In US$ millions) Q1 2020 vs. Q4 2019 $49.7 $47.6 Asset management $ 7.8 $ 0.1 $43.4 Banking 11.2 (2.8) FX Revenue 10.8 0.9 Trust 12.2 (0.8) Custody and Other 3.6 0.1 Q1 Q2 Q3 Q4 Q1 Other 2.0 0.3 2019 2020 Total Non-Int
Slide 10: Income Statement: Non-Interest Expenses
Income Statement Non-Interest Expenses Core Non-Interest Expense Trend* Core Non-Interest Expenses* vs. Q4 2019 (In US$ millions) $91.6 (In US$ millions) Q1 2020 $ % $87.6 $80.3 Salaries & Benefits** $ 44.1 $ (2.5) (5.4)% 66.3% 63.8% 60.1% Technology & Comm. 16.4 (0.1) (0.6)% Property 7.3 0.3 3.6 %
Slide 11: Capital Requirements and Return
Capital Requirements and Return Regulatory Capital (Basel III) - Total Capital Ratio*** Leverage Capital 9.8% 19.8% 0.6% 8.0% 1.2% 16.3% 14.1% 9.2% 6.8% Butterfield Current BMA 2020 Required US Peer Median * Butterfield - Current US Peer Median * TCE/TA TCE/TA Ex Cash Dividend Payout Ratio** • Capit
Slide 12: Balance Sheet
Balance Sheet Total Assets (In US$ millions) Q1 2020 Q4 2019 (In US$ billions) Cash & Equivalents $ 1,978 $ 2,550 $13.9 S/T Investments 1,048 1,218 $13.2 $11.6 Reverse Repos 192 142 Loans (net) 5,001 5,143 Investments 4,538 4,436 Other Assets 441 432 $4.4 $4.4 $4.5 Total Assets $ 13,197 $ 13,922 $5.
Slide 13: Asset Quality
Asset Quality Non-Accrual Loans Investment Portfolio (In US$ millions) Loan Distribution Rating Distribution $53.8 $53.1 $50.4 Gov’t: 7.3% BBB: 0.1% A: 0.5% Other Comm’l: AA: 0.3% 10.1% Res Mtg: 63.1% Comm’l R/E: 15.0% AAA: 99.1% Consumer: 4.5% $5.0 billion $4.5 billion Q1 Q2 Q3 Q4 Q1 2019 2020 • In
Slide 14: Interest Rate Sensitivity
Interest Rate Sensitivity Average Balance - Balance Sheet Interest Rate Sensitivity Average Balances 11.6% (US$Mil) Weighted Average 6.0% 4.9% Q1 2020 vs. Q4 2019 Duration vs. Q4 2019 Life 3.2% 3.5% Cash & Reverse Repos 2,529.6 (243.9) N/A N/A N/A (4.1)% S/T Invest. 1,151.5 133.1 0.2 (0.1) N/A -100b
Slide 15: Appendix
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Slide 16: Balance Sheet Trends
Appendix Balance Sheet Trends (in millions of US Dollars, unless otherwise indicated) 2020 2019 2018 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Assets Cash & Equivalents $ 1,978 $ 2,550 $ 3,605 $ 2,011 $ 2,601 $ 2,054 $ 1,259 $ 1,756 $ 1,846 Reverse Repos 192 142 62 166 72 27 72 89 198 S/T Investments 1,048 1,218 7
Slide 17: Average Balance Sheet Trends
Appendix Average Balance Sheet Trends (in millions of US Dollars, unless otherwise indicated) Q1 2020 Q4 2019 Q1 2019 Average Interest Average rate Average Interest Average rate Average Interest Average rate Assets balance ($) ($) (%) balance ($) ($) (%) balance ($) ($) (%) Cash due from banks, reve
Slide 18: Income Statement Trends
Appendix Income Statement Trends (in millions of US Dollars, unless otherwise indicated) 2020 2019 2018 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Net Interest Income $ 87.6 $ 86.2 $ 86.3 $ 85.2 $ 88.0 $ 87.4 $ 88.3 $ 87.4 $ 79.9 Non-Interest Income 47.6 49.7 46.6 44.2 43.4 45.7 41.3 41.9 39.8 Prov. for Credit Reco
Slide 19: Non-Interest Income & Expense Trends
Appendix Non-Interest Income & Expense Trends (in millions of US Dollars, unless otherwise indicated) 2020 2019 2018 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Non-Interest Income Trust $ 12.2 $ 13.0 $ 12.7 $ 13.0 $ 12.6 $ 13.8 $ 13.1 $ 13.2 $ 10.9 Asset Management 7.8 7.8 7.4 6.9 6.7 6.5 6.5 6.2 6.4 Banking 11.2 1
Slide 20: Core Non-Interest Expense Trends
Appendix Core Non-Interest Expense* Trends (in millions of US Dollars, unless otherwise indicated) 2020 2019 2018 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Salaries & Benefits** $ 44.1 $ 46.6 $ 42.8 $ 41.1 $ 42.8 $ 43.7 $ 43.8 $ 40.9 $ 37.0 Technology & Comm. 16.4 16.5 16.3 15.2 14.6 14.8 15.4 14.9 14.6 Property 7
Slide 21: Non-GAAP Reconciliation
Appendix Non-GAAP Reconciliation (in millions of US Dollars, unless otherwise indicated) 2020 2019 Q1 Q4 Q3 Q2 Q1 Net income A $ 40.3 $ 43.9 $ 42.4 $ 38.6 $ 52.1 Non-core (gains), losses and expenses Non-core (gains) losses Gain on disposal of a pass-through note investment (formerly a SIV) — — — —
Slide 22: Non-GAAP Reconciliation (cont'd)
Appendix Non-GAAP Reconciliation (cont'd) (in millions of US Dollars, unless otherwise indicated) 2020 2019 Q1 Q4 Q3 Q2 Q1 Tangible equity to tangible assets Shareholders' equity K $ 980.5 $ 963.7 $ 964.6 $ 928.7 $ 896.2 Less: goodwill and intangible assets (91.2) (96.5) (93.4) (72.2) (74.1) Tangibl
Slide 23: Commentary on Factors Influencing COVID-19 Implications
Appendix Commentary on Factors Influencing COVID-19 Implications The short- and medium/long-term implications of the pandemic on our business, financial condition, liquidity and results of operations will depend on factors such as, but not limited to the following: • The duration and scope of the pa
Slide 24: Peer Group
Appendix Peer Group Our peer group includes the following banks, noted by their ticker symbols: • FRC • SIVB • EWBC • CFR • ASB • WTFC • CBSH • IBKC • UMBF • FHB • BOH • TRMK • IBOC • CBU • BPFH • FFIN • WABC 24
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