Atlantic Union Bankshares Corporation · NYSE:AUB
Atlantic Union Bankshares — Q4 2022 Earnings Presentation
24 slides from Atlantic Union Bankshares's earnings presentation, Jan 24, 2023
Slide 1: 4th Quarter and FY2022 Earnings Presentation
4th Quarter and FY2022 Earnings Presentation NYSE: AUB January 24, 2023
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation and statements by the Company’s management may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that include, without limitation, statements on sl
Slide 3: Additional Information
Additional Information Non-GAAP Financial Measures No Offer or Solicitation This presentation contains certain financial information determined by methods other This presentation does not constitute an offer to sell or a solicitation of an offer to buy than in accordance with generally accepted acco
Slide 4: Our Company
Our Company Soundness | Profitability | Growth Highlights ($bn) Branch/Office Footprint AUB (114) • Statewide Virginia footprint of 109 AUB LPO (3) $ 20.5 $ 14.4 branches in all major markets AUB Equipment Finance Headquarters (1) Assets Loans • #1 regional bank1 deposit market share in Virginia • S
Slide 5: Our Shareholder Value Proposition
Leading Regional Presence Dense, uniquely valuable presence across attractive markets Our Shareholder Value Proposition Attractive Financial Profile Financial Strength Solid dividend yield Solid balance sheet & payout ratio with & capital levels earnings upside Peer-Leading Strong Growth Performance
Slide 6: Q4 2022 Highlights and 2023 Outlook
Q4 2022 Highlights and 2023 Outlook Loan Growth Operating Leverage Focus Positioning for Long Term • 15.3% annualized loan growth, ex- • ~11% pre-PPP adjusted revenue • Building solid Asset-Based lending Paycheck Protection Program (PPP) growth1 year over year and ~7% pre- pipeline (Non-GAAP)1, duri
Slide 7: We are focused on three Strategic Priorities
We are focused on three Strategic Priorities Organic Inorganic Deliver Organic Growth Innovate and Transform Strategic Investments • Overweighting opportunities in Wholesale • Pressing the relationship model advantage • Leveraging FinTech partnerships, strategic partner equity Banking Group where ba
Slide 8: We Believe We Are Well Positioned For The Current Environment
Growth Footing We Believe We Are Well Positioned For Asset Sensitivity The Current Expense Management Actions Environment And Optimistic Strong Credit About Our Future Top Tier Financial Performance Increased Shareholder Value 8
Slide 9: Q4 2022 Financial Performance At-a-Glance
Q4 2022 Financial Performance At-a-Glance Summarized Income Statement 4Q2022 3Q2022 • Net income available to common shareholders for the fourth quarter of 2022 was $67.6 million or $0.90 per share, up $12.5 Net interest income $ 163,848 $ 150,715 million or $0.16 per share compared to the prior qua
Slide 10: Q4 2022 Allowance For Credit Loss (ACL) and Provision for Credit Losses
Q4 2022 Allowance For Credit Loss (ACL) and Provision for Credit Losses Q4 Macroeconomic Forecast Allowance for Loan Reserve for Unfunded Allowance for Moody’s December 2022 Baseline Forecast: ($mm) & Lease Losses Commitments Credit Losses • US GDP expected to average 0.9% growth in 12/31/2021 $100M
Slide 11: Q4 2022 Net Interest Margin
Q4 2022 Net Interest Margin Margin Overview Market Rates 4Q2022 3Q2022 4Q2022 3Q2022 Net interest margin (FTE)1 3.70% 3.43% EOP Avg EOP Avg Loan yield 4.90% 4.20% Fed funds 4.50% 3.84% 3.25% 2.38% Investment yield 3.28% 2.95% Prime 7.50% 6.82% 6.25% 5.35% Earning asset yield 4.54% 3.88% 1-month LIBO
Slide 12: Q4 2022 Noninterest Income and Noninterest Expense
Q4 2022 Noninterest Income and Noninterest Expense Noninterest Expense Noninterest Income ($ thousands) 4Q2022 3Q2022 ($ thousands) 4Q2022 3Q2022 Salaries and benefits $ 58,723 $ 56,600 Service charges on deposit accounts $ 7,631 $ 6,784 Occupancy expenses 6,328 6,408 Other service charges, commissi
Slide 13: Q4 2022 Loan and Deposit Growth
Q4 2022 Loan and Deposit Growth Loan Growth ($ thousands) 4Q2022 3Q2022 QTD Annualized Growth Commercial & Industrial, ex PPP $ 2,976,063 $ 2,696,901 41.1% Commercial real estate - owner occupied 1,982,608 1,953,872 5.8% • At December 31, 2022, loans held for investment totaled $14.4 billion, an inc
Slide 14: Strong Capital Position at December 31, 2022
Strong Capital Position at December 31, 2022 Regulatory Atlantic Union Atlantic Capital Ratio Well Capitalized Bankshares* Union Bank* Common Equity Tier 1 Ratio (CET1) 7.0% 10.0% 12.8% Capital Management Strategy Tier 1 Capital Ratio 8.5% 10.9% 12.8% Atlantic Union capital management objectives are
Slide 15: Top-Tier Financial Targets
18% – 20% 1.3% – 1.5% ≤ 51% (1) Return on Tangible Return on Assets Efficiency Ratio (FTE) Common Equity Top-Tier Financial Targets Atlantic Union is committed to achieving Key financial performance operating top tier financial performance and metrics benchmarked against top providing our shareholde
Slide 16: Financial Outlook
Financial Outlook1 Full Year 2023 Targets versus FY 2022 1Key Economic Assumptions Loan Growth ~6% - 8% • Stabilizing Interest Rate environment Net Interest Income (FTE) Growth ~13% – 15% • The Federal Reserve Bank fed funds rate increases to 5.0% Net Interest Margin (FTE) ~3.70% – 3.75% • Mild rece
Slide 17: Appendix
Appendix y) Atlantic i — ’ fA a , Union Bankshares bens. a
Slide 18: Reconciliation of Non-GAAP Disclosures
Reconciliation of Non-GAAP Disclosures The Company has provided supplemental performance measures on a tax-equivalent, tangible, operating, adjusted, or pre-tax pre-provision basis. These non-GAAP financial measures are a supplement to GAAP, which is used to prepare the Company’s financial statement
Slide 19: Reconciliation of Non-GAAP Disclosures
Reconciliation of Non-GAAP Disclosures ADJUSTED OPERATING EARNINGS, OPERATING LEVERAGE, AND EFFICIENCY RATIO Adjusted operating measures exclude the losses related to For the three months ended For the year ended December 31, % Change balance sheet repositioning (principally composed of losses on (D
Slide 20: Reconciliation of Non-GAAP Disclosures
Reconciliation of Non-GAAP Disclosures Net interest income (FTE), total revenue NET INTEREST MARGIN (FTE), and total adjusted revenue (FTE), For the three months ended For the years ended December 31, which are used in computing net interest (Dollars in thousands) 4Q2022 3Q2022 2022 2021 margin (FTE
Slide 21: Reconciliation of Non-GAAP Disclosures
Reconciliation of Non-GAAP Disclosures TANGIBLE ASSETS, TANGIBLE COMMON EQUITY, AND LEVERAGE RATIO Tangible assets and tangible common equity As of December 31, 2022 are used in the calculation of certain Atlantic Union (Dollars in thousands, except share data) Bankshares Atlantic Union Bank profita
Slide 22: Reconciliation of Non-GAAP Disclosures
Reconciliation of Non-GAAP Disclosures OPERATING MEASURES Tangible assets and tangible common equity are For the three months ended For the years ended December 31, used in the calculation of certain profitability, capital, (Dollars in thousands, except per share amounts) 4Q2022 3Q2022 2022 2021 and
Slide 23: Reconciliation of Non-GAAP Disclosures
Reconciliation of Non-GAAP Disclosures Pre-tax pre-provision adjusted earnings PRE-TAX PRE-PROVISION ADJUSTED OPERATING EARNINGS excludes the provision for credit losses, For the three months ended For the years ended December 31, which can fluctuate significantly from period- (Dollars in thousands,
Slide 24: Reconciliation of Non-GAAP Disclosures
Reconciliation of Non-GAAP Disclosures ALLOWANCE FOR CREDIT LOSS RATIOS AND TOTAL ADJUSTED LOANS PPP adjustment impact excludes the unforgiven portion of PPP loans. The As of As of As of Company believes loans held for investment (Dollars in thousands) December 31, 2022 September 30, 2022 December 3
Atlantic Union Bankshares — Q4 2022 Earnings Presentation on 6ix