Amerant Bancorp Inc. · NYSE:AMTB
Amerant Bancorp — Q3 2023 Earnings Presentation
32 slides from Amerant Bancorp's earnings presentation, Oct 20, 2023
Slide 1: Third Quarter Earnings
amerantbank.com Third Quarter Earnings October 20, 2023
Slide 2: Important Notices and Disclaimers
Important Notices and Disclaimers 2 Forward-Looking Statements This presentation contains “forward-looking statements” including statements with respect to the Company’s objectives, expectations and intentions and other statements that are not historical facts. All statements other than statements o
Slide 3: Performance Highlights 3Q23
Performance Highlights 3Q23 3 • Net income attributable to the Company was $22.1 million in 3Q23 compared to $7.3 million in 2Q23 • Pre-provision net revenue was $36.5 million in 3Q23 compared to $38.3 million in 2Q23 Earnings • Diluted earnings per share (EPS) was $0.66 in 3Q23 compared to $0.22 in
Slide 4: Shares Outstanding
Shares Outstanding 4 Changes in shares outstanding: Class A balance at June 30, 2023 33,736,159 (1) Class A repurchase program (142,188) (2) Stock-based compensation activity (10,350) Balance at September 30, 2023 33,583,621 (1) Shares were bought back under the "2023 Class A Common Stock Repurchase
Slide 5: Well Capitalized Position
Well Capitalized Position 5 As of September 30, 2023 Total Capital Ratio 12.70% Regulatory Minimum: 10.00% Common Equity Tier 1 Capital (CET1) Ratio 10.30% Regulatory Minimum: 6.50% (1)(3) TCE Ratio 7.44% (2)(3) TCE adj. for HTM Valuation 7.18% (3) TBV/Share adj. for HTM Valuation $19.86 (1) Include
Slide 6: Deposits Details
Deposits Details 6 ($ in millions, except %) Change QoQ Change YTD 4Q22 2Q23 3Q23 $ % $ % Commercial Real Estate 211 255 292 37 15 81 38 Commercial & Industrial 819 1,028 1,010 (18) (2) 191 23 Specialty Finance 123 176 209 33 19 86 70 Florida Government and Municipalities 283 275 263 (12) (4) (20) (
Slide 7: Well Diversified and Stable Deposit Mix
Well Diversified and Stable Deposit Mix 7 Deposit Composition Mix by Country of Domicile ($ in millions, except for percentages) Domestic Deposits 67% of Total Deposits 8,000 $7,580 $7,547 ($ in millions) 48,907 Accounts $7,287 $7,044 $1,294 $1,370 5,000 7,000 $6,588 $1,361 $1,368 $1,319 6,000 $686
Slide 8: Key Performance Metrics
Key Performance Metrics 8 ACL / Total NIB Deposits/ Net Interest Efficiency (1) (2) Tier 1 Capital ROA ROE Loans held for Total Deposits Margin Ratio Ratio (3) investment 0.92% 1.48% 1.40% 3.83% 3.57% 10.77% 11.08% 65.61% 64.10% 11.93% 18.2% 17.1% 0.31% 3.92% 2Q23 3Q23 2Q23 3Q23 2Q23 3Q23 2Q23 3Q23
Slide 9: Investment Portfolio
Investment Portfolio 9 (1) Balances and Yields Highlights ($ in millions) • Effective duration increased to 5.3 years driven by higher estimated 1,500 mortgage rates and therefore slower prepayments $12.2 $2.5 $2.4 • Valuation of AFS debt securities decreased $18.6 million after-tax in $234.3 $234.4
Slide 10: Loan Portfolio Highlights
Loan Portfolio Highlights 10 (1) (1) Loan Composition Geographic Mix (Domestic) 8.9% 8.7% 7.7% 7.0% 6.1% 3.8% 4.0% 3.8% 3.9% 4.0% 15.8% 16.7% 17.4% 18.5% 19.5% 2.5% 2.3% 2.1% 2.1% 2.0% 5.3% 4.8% 4.4% 4.1% 3.4% 15.3% 15.1% 15.0% 14.7% 15.8% 19.6% 18.5% 20.6% 20.8% 20.0% 18.7% 20.2% 21.3% 22.0% 20.5%
Slide 11: Credit Quality
Credit Quality (2) 11 NPLs (1) and NPAs (1) / Total Assets Allowance for Credit Losses ($ in millions) $106.0 $98.8 $83.5 $84.4 $76.5 1.48% 0.50% 0.41% 1.40% 0.36% 0.51% 0.71% 0.21% 0.41% 0.23% 0.57% 0.29% 1.19% 1.22% 1.20% 3Q22 4Q22 1Q23 2Q23 3Q23 3Q22 4Q22 1Q23 2Q23 3Q23 NPLs / Total Assets NPAs /
Slide 12: Commercial Real Estate (CRE) Held For Investment-Detail
Commercial Real Estate (CRE) Held For 12 Investment-Detail Outstanding as of September 30, 2023 ($ in millions, except %) % Total % Total Income Land and CRE Type FL TX NY Other Total CRE Loans (1) Producing (2) Construction Retail $ 483 $ 157 $ 81 $ 2 $ 723 27.2 % 10.3 % $ 719 $ 4 Multifamily 342 4
Slide 13: Net Interest Income and NIM
13 Net Interest Income and NIM Net Interest Income (NII) and NIM (%) Commentary ($ in millions, except for percentages) $82.2 $82.3 $83.9 NII was down in 3Q23 which was mainly driven by: $78.6 80 $69.9 • higher average rates on total interest bearing 70 liabilities, mainly total deposits and FHLB 60
Slide 14: Interest Rate Sensitivity
Interest Rate Sensitivity 14 (1) (1) Impact on NII from Interest Rate Change Impact on AFS from Interest Rate Change As of September 30, 2023 Expected AOCI Accretion 1,129 9.6% 1,081 1,056 1,032 1,009 400 6.3% 9.4% 986 943 (130) 4.3% 4.7% ($ in Millions) 0% 2.3% ($ in Millions) -1.6% 0% 350 -3.5% -7
Slide 15: Noninterest Income Mix
Noninterest Income Mix 15 Noninterest Income Mix Commentary ($ in millions) $19.3 • Noninterest income was down by $4.7 million in 3Q23, 30 $24.4 $26.6 primarily due to: $62.4 ◦ lower gains on the early extinguishment of FHLB $21.9 advances $11.4 $13.2 $13.4 20 $16.0 $7.0 ◦ lower mortgage banking in
Slide 16: Noninterest Expense
Noninterest Expense 16 Noninterest Expense Mix Commentary ($ in millions, except for FTEs) • Noninterest expense decreased in 3Q23 primarily due to: – the absence of the loss on sale of repossessed assets in 2Q23 in connection with our equipment-financing activities $72.5 – the absence of additional
Slide 17: Amerant Mortgage ("AMTM")
Amerant Mortgage ("AMTM") 17 3Q23 2Q23 (1) (2) (3)(5) (1) (2) (3)(5) AMTB AMTM, net Consolidated AMTB AMTM, net Consolidated (in thousands, except for FTEs) FTEs 602 98 700 617 93 710 (4) Total revenue $ 99,053 $ 1,445 $ 100,498 $ 107,500 $ 2,996 $ 110,496 Expenses Personnel 29,265 2,069 31,334 30,9
Slide 18: Core Conversion - FIS
Core Conversion - FIS 18 The primary objectives: • Move to a state-of-the-art core system and modern stack • Create a simplified and fully integrated ecosystem of applications • Significantly strengthen cybersecurity and information security infrastructure • Leverage selected back-office functions w
Slide 19: Physical Transformation Update
Physical Transformation Update 19 • Final two branch “refresh” locations to be completed before year end; five other locations completed YTD • This will complete the entire network - essential for “common look and feel” of Amerant experience for our team members and customers • New locations - in th
Slide 20: Continuing to Promote Our Brand
Continuing to Promote Our Brand 20
Slide 21: In Conclusion
In Conclusion 21 We are nearing the end of our “transformation” phase… • We have our executive leadership team in place and we are focused on attracting the right people to add to our team to achieve our strategic objectives • Completing transition to FIS will provide the technological platform to s
Slide 22: Supplemental Loan Portfolio Information
Supplemental Loan Portfolio Information
Slide 23: Loans Held for Investment Portfolio by Industry
Loans Held for Investment Portfolio by Industry 23 As of September 30, 2023 Real Non-Real % Total Highlights ($ in millions) Estate Estate Total Loans Financial Sector (1) $ 6 $ 227 $ 233 3.3 % Construction and Real Estate & Leasing: • Diversified portfolio - highest sector concentration, other Comm
Slide 24: CRE Retail - Detail
CRE Retail - Detail 24 As of 09/30/2023 (1) (1) CRE Retail CRE Retail - Single Tenant Retail - LTV 60% Theme/ 50% Festival Neighborhood Center; 14% Center; 43% Tobacco & CBD; 36% Food and Health Retail; 25% 40% 34% 31% 30% 17% 18% 20% Single 10% Tenant; 7% —% Community Clothing; 39% 0% Center; 22% S
Slide 25: CRE Office - Detail
CRE Office -Detail 25 As of 09/30/2023 (1) CRE Office Office - LTV 60% New York; 10% Texas; 13% 50% 40% 37% 31% 30% 20% 16% 16% South Florida; 77% 10% —% 0% 50% or 51-60% 61-70% 71-80% 81% or less more Total: $303 million Loan Portfolio Percentage: 4.2% (1) CRE office loans above $5 million Highligh
Slide 26: Non-GAAP Financial Measures Reconciliations
Appendix 1 26 Non-GAAP Financial Measures Reconciliations The following table sets forth selected financial information derived from the Company’s interim unaudited and annual audited consolidated financial statements, adjusted for certain costs incurred by the Company in the periods presented relat
Slide 27: Non-GAAP Financial Measures Reconciliations (cont'd)
Appendix 1 27 Non-GAAP Financial Measures Reconciliations (cont’d) Three Months Ended, ($ in thousands) September 30, 2023 June 30, 2023 March 31, 2023 December 31, 2022 Total noninterest expenses $ 64,420 $ 72,500 $ 64,733 $ 62,241 Less: non-routine noninterest expense items Restructuring costs (3)
Slide 28: Non-GAAP Financial Measures Reconciliations (cont'd)
Appendix 1 28 Non-GAAP Financial Measures Reconciliations (cont’d) Three Months Ended, (in thousands, except percentages and per share amounts) September 30, 2023 June 30, 2023 March 31, 2023 December 31, 2022 Net income attributable to Amerant Bancorp Inc. (1) $ 22,119 $ 7,308 $ 20,186 $ 21,973 Plu
Slide 29: Non-GAAP Financial Measures Reconciliations (cont'd)
Appendix 1 29 Non-GAAP Financial Measures Reconciliations (cont’d) Three Months Ended, (in thousands, except percentages, share data and per share amounts) September 30, 2023 June 30, 2023 March 31, 2023 December 31, 2022 Net income / Average stockholders' equity (ROE) (1) 11.93 % 3.92 % 11.15 % 12.
Slide 30: Non-GAAP Financial Measures Reconciliations (cont'd)
Appendix 1 30 Non-GAAP Financial Measures Reconciliations (cont’d) Three Months Ended, (in thousands, except percentages, share data and per share amounts) September 30, 2023 June 30, 2023 March 31, 2023 December 31, 2022 Tangible common stockholders' equity $ 692,969 $ 696,832 $ 704,764 $ 682,565 L
Slide 31: Non-GAAP Financial Measures Reconciliations (cont'd)
Appendix 1 31 Non-GAAP Financial Measures Reconciliations (cont’d) (1) As previously disclosed, the Company adopted CECL in the fourth quarter of 2022, effective as of January 1, 2022. See Form 10-K for more details of the CECL adoption and related effects to quarterly results for each quarter in th
Slide 32: AMERANT Mission, Vision and Precepts
AMERANT™ Mission To provide our customers with the products, services and advice they need to achieve financial success, through our diverse, inclusive and motivated team that is personally involved with the communities we serve, all of which result in increased shareholder value. Vision To be the B