Wesbanco, Inc. · NASDAQ:WSBC
Wesbanco — IPO Roadshow (March 2022)
38 slides from Wesbanco's IPO roadshow presentation, Mar 18, 2022
Slide 1: March 2022 Fixed Income Investor Presentation
March 2022 Fixed Income Investor Presentation (WSBC financials for the three months ended December 31, 2021) Issuer Free Writing Prospectus Dated March 18, 2022 Filed Pursuant to Rule 433 Registration No. 333-239181
Slide 2: Non-GAAP measures and forward-looking statements
In addition to the results of operations presented in accordance with Generally Accepted Accounting Principles (GAAP), Wesbanco's management uses, and this presentation contains or references, certain non-GAAP financial measures, such as pre-tax pre-provision income, tangible common equity/tangible
Slide 3: No Offer or Solicitation; About Wesbanco
No Offer or Solicitation This presentation is not an offer to sell, nor is it a solicitation of an offer to buy, any securities of Wesbanco. Neither the SEC nor any other regulatory body has approved or disapproved of the securities of Wesbanco or passed upon the accuracy or adequacy of this present
Slide 4: Preliminary Term Sheet
Preliminary Term Sheet Issuer (Ticker) Security Offered Expected Security Rating (1) Offering Type Call Type Coupon Type Use of Proceeds Lead Book-running Manager Wesbanco, Inc. (NASDAQ: WSBC) Fixed-to-Floating Rate Subordinated Notes Due 2032 BBB by Kroll Bond Rating Agency SEC registered Non-call
Slide 5: Today's Presenters
Today’s Presenters Todd F. Clossin - President and Chief Executive Officer Joined WSBC in November of 2013 as EVP & COO; Named President & CEO in April 2014 38 years of experience in banking Previously held senior management positions at Fifth Third Bank, including EVP & Chief Administrative Officer
Slide 6: Strategies for Long-Term Success
Strategies for Long-Term Success
Slide 7: Long-Term Growth Strategies
Long-Term Growth Strategies Focus on Delivering Positive Operating Leverage Strong Legacy of Credit Quality, Risk Management, and Compliance Diversified Loan Portfolio with C&I and Home Lending Focus Long History of Strong Wealth Management Capabilities Digital Banking Service Strategies & Core Depo
Slide 8: Diversified Loan Portfolio
Diversified Loan Portfolio Focus on strategic diversification, growth, and credit quality Balance disciplined loan origination with prudent lending standards Focus on C&I and home equity lending Key offerings include treasury management, foreign exchange, cyber security, and lockbox services Strong
Slide 9: Strong Wealth Management Capabilities
Private Banking $1.0B in private banking loans and deposits 3,650+ relationships Legacy market private wealth management growth opportunities Strong Wealth Management Capabilities Note: Assets, loans, deposits, and clients as of 12/31/2021; chart financials as of 12/31 unless otherwise stated. Priva
Slide 10: Digital banking utilization
Digital banking utilization ~70% of retail customers utilize online digital banking services ~4.1 million web and mobile logins per month Mobile ~50% of total, with an average of 19 monthly logins per customer Mobile wallet & mobile deposits increased ~60% & ~15% YoY, respectively Zelle® payment ser
Slide 11: Benefits of Core Deposit Funding Advantage
Benefits of Core Deposit Funding Advantage Robust legacy deposit base provides funding advantage in the Mid-Atlantic market Reflecting the significantly lower interest rate environment, aggressively reduced deposit rates since March 2020 During the last five years: Total deposits (excluding CDs) hav
Slide 12: Evolving Regional Financial Services Institution
Evolving Regional Financial Services Institution Strong market presence across legacy and major metropolitan markets Balanced loan and deposit distribution across diverse regional footprint Diversified revenue generation engines supported by unique long-term advantages Well-executed long-term growth
Slide 13: Franchise Expansion
Franchise Expansion Targeted acquisitions in existing markets and new higher-growth metro areas Long-term focus on appropriate capital management to enhance shareholder value Strong capital and liquidity, along with strong regulatory compliance processes, provides ability to execute transactions qui
Slide 14: Focus on Enhancing Shareholder Value
Focus on Enhancing Shareholder Value Disciplined growth, balanced by a fundamental focus on expense management and supported by franchise-enhancing acquisitions, in order to deliver positive operating leverage and enhance shareholder value Note: Financial data as of 12/31; current data as of 12/31/2
Slide 15: Recent Successes and Accolades
Recent Successes and Accolades WesBanco Bank was named one of America’s Best Midsize Employers by Forbes, based on employee feedback and recommendations – the only midsize bank in the top ten for both financial performance and employer of choice WesBanco Bank was again named one of the ten Best Bank
Slide 16: Financial Overview
WesBaneo By all accounts, better. Financial Overview
Slide 17: Q4 2021 Financial and Operational Highlights
Q4 2021 Financial and Operational Highlights Note: Financial and operational highlights during the quarter ended December 31, 2021. (1) Non-GAAP measure – please see reconciliation in appendix. Solid pre-tax, pre-provision income and net income (excluding restructuring & merger-related expenses) Con
Slide 18: Q4 2021 Total Portfolio Loans
Q4 2021 Total Portfolio Loans ($MM) Loan growth for Q4 2021 reflects the continuation of both SBA PPP loan forgiveness and elevated commercial real estate payoffs ~1,950 SBA PPP loans remaining total ~$163 million (as of 12/31/2021) During Q4 2021, ~1,240 customers received forgiveness of SBA PPP lo
Slide 19: Q4 2021 Net Interest Margin (NIM)
Q4 2021 Net Interest Margin (NIM) NIM negatively impacted by the lower interest rate environment, and a shift to a higher level of securities as a percentage of total assets As a result of higher cash balances, 12/31/2021 investment securities increased $1.3 billion year-over-year, to represent ~24%
Slide 20: Q4 2021 Non-Interest Income
Q4 2021 Non-Interest Income Trust fees increased primarily from net organic growth in trust assets under management ($5.6 billion) Service charges on deposits were higher due to increased general consumer spending, resulting in higher eligible account fees Mortgage banking income decreased due to ho
Slide 21: Q4 2021 Non-Interest Expense
Q4 2021 Non-Interest Expense Salaries and wages increased due to higher employee commissions and lower loan contra-costs Base salary expenses decreased $1.7 million and bonus and stock compensation expense decreased $0.6 million, year-over-year Equipment and software increased due primarily to the m
Slide 22: Comparable Operating Metrics
Comparable Operating Metrics Disciplined execution upon growth strategies providing strong performance compared to all U.S. banks with total assets from $10B to 25B (note: 2020 comparability impacted by timing of the adoption of CECL accounting standard and economic assumptions used by each bank) No
Slide 23: Solid Legacy of Credit Quality
Non-Performing Assets as % of Total Assets Net Charge-Offs as % of Average Loans (YTD annualized) Allowance for Credit Losses as % of Total Loans Criticized & Classified Loans as % of Total Loans Favorable asset quality measures compared to all U.S. banks with total assets from $10B to 25B (note: 20
Slide 24: Strong Risk Management and Capital Position
Strong Risk Management and Capital Position Outstanding Trust Preferred(1) Principal Balance ($000s) Rate Callable Wesbanco Capital Trust II $13,000 3ML + 315bps Yes Wesbanco Capital Trust III $17,000 3ML + 310bps Yes Wesbanco Capital Trust IV $20,000 3ML + 265bps Yes Wesbanco Capital Trust V $20,00
Slide 25: Returning Value to Shareholders
Returning Value to Shareholders Focus on appropriate capital allocation to provide financial flexibility while continuing to enhance shareholder value through earnings growth and effective capital management Capital management strategy: dividends, share repurchases, acquisitions Q4 2021 dividend yie
Slide 26: Summary
WesBaneo By all accounts, better. Summary
Slide 27: Investment Rationale
Investment Rationale Balanced loan and deposit distribution across footprint Diversified earnings streams built for long-term success, led by century-old, $5.6B trust and wealth management business Strong presence in economically diverse, major markets supported by positive demographic trends Robust
Slide 28: Appendix
WesBaneo By all accounts, better. Appendix
Slide 29: Executive Management
Executive Management Michal L. Perkins Senior Executive Vice President Chief Risk & Administrative Officer Mr. Perkins has served in enterprise risk management responsibilities since 2001 Previously, Mr. Perkins was Senior Vice President and Chief Auditor of the Corporation Mr. Perkins has 32 years
Slide 30: Current Rating Profile
Current Rating Profile Note: A rating is not a recommendation to buy, sell or hold securities. Ratings may be subject to revision or withdrawal at any time by the assigning rating organization. Each rating agency has its own methodology for assigning ratings and, accordingly, each rating should be e
Slide 31: Interest Coverage
Interest Coverage Source: S&P Global Market Intelligence and Company documents. Assumes a $150mm subordinated debt raise at 3.875% coupon.
Slide 32: Q4 2021 Key Metrics
Q4 2021 Key Metrics Note: PTPP = pre-tax, pre-provision. Non-GAAP measure – please see reconciliation in appendix. Excludes restructuring and merger-related expenses. Q3 2021 non-interest expense includes $2.6 million of pre-tax settlement costs with respect to the pending resolution of a lawsuit, e
Slide 33: Q4 2021 Current Expected Credit Loss (CECL)
The decrease in the allowance was primarily driven by improvements in the COVID-19 pandemic related adjustments These improvements resulted in a negative provision for credit losses of $13.6 million Allowance coverage ratio of 1.25%, or, excluding SBA PPP loans, 1.27% Excludes fair market value adju
Slide 34: Reconciliation: Efficiency Ratio
Reconciliation: Efficiency Ratio Note: “efficiency ratio” is non-interest expense excluding restructuring and merger-related expense divided by total income; FTE represents fully taxable equivalent; Old Line Bancshares merger closed November 2019; Farmers Capital Bank Corporation merger closed Augus
Slide 35: Reconciliation: Pre-Tax, Pre-Provision Income (PTPP) and Ratios
Reconciliation: Pre-Tax, Pre-Provision Income (PTPP) and Ratios
Slide 36: Reconciliation: Net Income, EPS & Tangible Book Value per Share
Reconciliation: Net Income, EPS & Tangible Book Value per Share Note: Current Expected Credit Losses (“CECL”) accounting standard adopted January 1, 2020 by WSBC.
Slide 37: Reconciliation: Return on Average Assets
Note: Current Expected Credit Losses (“CECL”) accounting standard adopted January 1, 2020 by WSBC; Old Line Bancshares merger closed November 2019; Farmers Capital Bank Corporation merger closed August 2018; First Sentry Bancshares merger closed April 2018. Reconciliation: Return on Average Assets
Slide 38: Reconciliation: Return on Average Tangible Equity
(1) Amortization of intangibles tax effected at 21% for 2018 forward, and 35% for all prior periods. Note: Current Expected Credit Losses (“CECL”) accounting standard adopted January 1, 2020 by WSBC; Old Line Bancshares merger closed November 2019; Farmers Capital Bank Corporation merger closed Augu