Stifel Financial Corporation · NYSE:SF
Stifel Financial — Q1 2020 Earnings Presentation
17 slides from Stifel Financial's earnings presentation, May 3, 2020
Slide 1: 1st Quarter 2020 Financial Results Presentation
1st Quarter 2020 Financial Results Presentation April 30, 2020 Quarterly Earnings Report
Slide 2: Responding to COVID-19
Responding to COVID-19 ASSOCIATES INDIVIDUAL CLIENTS & COMMUNITIES ■ Maintained continuous communications with our associates ■ Firm, executive, and leadership support of international, national, and neighborhood organizations supporting health and wellness, frontline ■ Committed to supporting our h
Slide 3: First Quarter Snapshot
First Quarter Snapshot 1Q20 RESULTS millions, except per share and ratios NET REVENUES NET EARNINGS EPS GAAP $913.0 NON-GAAP $913.2 GAAP $81.7 NON-GAAP $91.9 GAAP $1.07 NON-GAAP $1.20 ANNUALIZED ROE ANNUALIZED ROTCE BOOK VALUE PER SHARE GAAP 10.0% NON-GAAP 11.2% GAAP 17.4% NON-GAAP 19.5% $46.13 HIGH
Slide 4: First Quarter Results
First Quarter Results FINANCIAL RESULTS FIRST QUARTER HIGHLIGHTS millions 1Q20 VS 1Q19 ■ Record Revenue Global Wealth Management $ 583 14% ■ First quarter Non-GAAP Net Revenue of $913 million, up 19% Y/Y. Institutional 332 27% ■ Global Wealth Management Net Revenue of $583 million, up 14% Y/Y. Other
Slide 5: Global Wealth Management
Global Wealth Management GLOBAL WEALTH MANAGEMENT REVENUE HIGHLIGHTS millions 1Q20 VS 1Q19 ■ Record Net Revenue of $583 million, up 14% Y/Y Brokerage $ 180 17% ■ Record Brokerage Revenue of $180 million, up 17% Y/Y Asset Management & Service Fees 238 22% ■ Record Asset Management & Service Fees of $
Slide 6: Wealth Management Metrics
Wealth Management Metrics RECRUITING DRIVES REVENUE GROWTH DYNAMIC BUSINESS ■ 85% of FAs joined Stifel in past 10 years came through organic $160 200 recruiting, 15% through acquisitions $140 180 160 ■ Recruiting remotely during pandemic $120 Financial Advisors 140 $100 ■ Growth of average AUM milli
Slide 7: Institutional Group
Institutional Group INSTITUTIONAL REVENUE HIGHLIGHTS millions 1Q20 VS 1Q19 ■ Second Strongest Quarterly Revenue of $332 million, up 27% Y/Y Advisory $ 76 -27% ■ Record Institutional Brokerage of $170 million, up 60% Y/Y Capital Raising 93 91% ■ Capital Markets Revenue of $93 million, up 91% Y/Y Brok
Slide 8: Institutional Equities & Fixed Income
Institutional Equities & Fixed Income INSTITUTIONAL INSTITUTIONAL EQUITIES EQUITIES TABLE REVENUE INSTITUTIONAL FIXED INCOME REVENUE millions 1Q20 VS 1Q19 millions 1Q20 VS 1Q19 Brokerage $ 70 81% Brokerage $ 100 48% Capital Raising 60 116% Capital Raising 33 58% Total Equities $ 130 95% Total Fixed
Slide 9: Investment Banking Revenue
Investment Banking Revenue INVESTMENT BANKING REVENUE HIGHLIGHTS millions 1Q20 VS 1Q19 ■ On record revenue pace through February Capital raising: ■ Strongest Verticals were Healthcare, Industrials, and Financials Equity $ 64,774 98% ■ Completed two 144A offerings ■ Increased engagement for Miller Bu
Slide 10: Net Interest Income
Net Interest Income CONDENSED NET INTEREST INCOME NET INTEREST COMMENTARY 1Q20 Y/Y Change ■ 1Q20 NII comes in within previous guidance range, but negatively impacted by Average Average rate environment Average Average Interest Interest Balance Balance Interest Earning Asset were flat year-on-year bu
Slide 11: Investment Portfolio & CLOs
Investment Portfolio & CLOs INVESTMENT PORTFOLIO HIGHLIGHTS millions Total Portfolio % of Portfolio ■ AAA /AA CLOs with a Portfolio Credit Enhancement of 28.7% CLOs $ 4,399 67.20% ■ 87% of CLO Collateral is BB/B Agency MBS 807 12.33% ■ Using Severely Adverse Default Expectations Results in Remaining
Slide 12: Stifel Bancorp Inc. Loan Portfolio
Stifel Bancorp Inc. Loan Portfolio LOAN PORTFOLIO HIGHLIGHTS millions 1Q20 %of Total Portfolio ■ Lending facilities for Stifel WM and Institutional clients, as well as banking relationships outside of Stifel Residential Real Estate $ 3,495 34.41% ■ Over 50% of the loan portfolio is to Wealth Managem
Slide 13: CECL Impact
CECL Impact ASSUMPTIONS CECL 1Q20 FACTORS ■ Moody’s forecast: ■ 40% Baseline (sudden sharp recession) ■ 30% Downside (double dip recession) ■ 30% Upside (near term growth) ■ Forecast update for most recent scenarios ■ Includes significant economic shock in 2Q and 3Q, followed by slow, sustained reco
Slide 14: Expenses
Expenses NON-GAAP EXPENSES & PRE-TAX INCOME COMPENSATION RATIO millions 1Q20 VS 1Q19 64.0% 62.5% Compensation $ 571 26% 62.0% 3.5% Ex. IB gross up & loan loss provision 187 18% 60.0% 59.0% 58.3% Provision and IB gross up 27 141% 57.9% 58.1% 58.0% Non-compensation 214 26% 59.0% 56.0% Pre-tax Income $
Slide 15: Capital & Liquidity
Capital & Liquidity FIRM-WIDE ASSETS & CAPITAL RATIOS HIGHLIGHTS $25,896 $26,000 21.0% ■ Significant Increase in Sweep Balances During 1Q20 18.5% 18.0% 18.1% 17.6% 19.0% ■ Balance Sheet Growth due to Higher Cash Balances and Loan Draws $25,000 $24,610 16.6% $24,184 $24,344 $24,161 17.0% ■ No longer
Slide 16: Quarterly Earnings Report
Quarterly Earnings Report
Slide 17: Disclaimer
Disclaimer Forward-Looking Statements This presentation may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that involve significant risks, assumptions, and uncertainties, including statements relating to the market opportunity and futu