Amerant Bancorp Inc. · NYSE:AMTB
Amerant Bancorp — Q3 2019 Earnings Presentation
23 slides from Amerant Bancorp's earnings presentation, Oct 29, 2019
Slide 1: Third Quarter 2019 Financial Review Earnings Call
Third Quarter 2019 Financial Review Earnings Call October 29, 2019
Slide 2: Important Notices and Disclaimers
2 Important Notices and Disclaimers Forward-Looking Statements This presentation contains “forward-looking statements” within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, including, without limitation, future financial and operating results; costs and revenues;
Slide 3: Performance Highlights 3Q19
Performance Highlights 3Q19 3 Strategy-Driven Achievements • Net Income increased 3.3% over 3Q18, or 8.0% as adjusted(1), YTD Net income increased 20.6% or 10.4% as adjusted(1) compared to same period last year • Noninterest income increased 6.8% over 3Q18, driven mainly by increased fee income on d
Slide 4: Third Quarter 2019 Results
Third Quarter 2019 Results 4 ($ in millions, except per share items) 3Q18 2Q19 3Q19 Return on Equity(5) (ROE) Adjusted ROE(1)(5) Net Interest Income $55.6 $53.8 $52.6 Net Interest Margin (NIM) 2.83% 2.92% 2.80% 7.66% (Reversal of) Provision for Loan Losses 1.6 (1.4) (1.5) 6.13% 6.56% 5.81% 6.35% 6.3
Slide 5: Investment Portfolio
Investment Portfolio 5 Investment Securities Balances and Yields Highlights ($ in millions) • Effective duration of 2.6 years as prepayment speeds 1,750 $86.3 accelerate in the mortgage securities portfolio (due 1,500 $81.2 $77.6 to lower interest rates) and continued sale of 1,250 municipal bonds d
Slide 6: Loan Portfolio Highlights
6 Loan Portfolio Highlights Loan Composition Geographic Mix (Domestic) (Domestic)(1) 7,000 1.9% 1.9% 1.9% 1.8% 1.8% 6,000 1.2% 0.5% 0.4% 0.4% 5.0% 9.3% 9.2% 9.2% 6,000 9.0% $762 $738 8.3% 5,000 $775 $812 $808 11.5% 13.1% 14.0% 14.4% 14.4% 5,000 $968 $1,000 $943 $1,010 4,000 $1,040 20.3% 19.6% 4,000
Slide 7: Credit Quality
Credit Quality 7 Non-Performing Assets (1) / Total Assets Allowance for Loan Losses ($ in millions) 0.41% 0.42% $69.5 0.35% $61.8 0.26% $60.3 0.22% 1.13% $57.4 1.04% 1.05% $53.6 0.99% 0.93% 3Q18 4Q18 1Q19 2Q19 3Q19 3Q18 4Q18 1Q19 2Q19 3Q19 Allowance for Loan Losses ALL as a % of Total Loans (3) Allo
Slide 8: Interest-Earning Assets
8 Interest-Earning Assets ($ in millions, except for percentages ) 9,000 8,000 7,000 $1,792 $1,741 $1,701 $1,651 $1,633 6,000 $6,159 $5,920 $5,744 $5,813 $5,754 5,000 4.74% 4.74% 4.75% 4,000 4.51% 4.64% 3,000 2,000 2.98% 2.75% 2.87% 2.85% 2.73% 1,000 0 3Q18 4Q18 1Q19 2Q19 3Q19 Loans Investments Loan
Slide 9: Wholesale Funding
9 Wholesale Funding FHLB and Other Borrowings by Maturity Advances from the Federal Home Loan Bank and Other September 30, 2019 Borrowings ($ in millions) Year of Maturity Interest Rate 3Q18 2Q19 3Q19 2020 27.8% 2018 1.25% to 2.38% $ 437 $ — $ — 2019 16.7% 2019 1.80% to 3.86% 225 350 195 2020 1.50%
Slide 10: Deposit Highlights
Deposit Highlights 10 Deposit Composition Mix by Country of Domicile ($ in millions, except for FTEs) International Deposits 7,000 ($ in millions) $6,189 ~13% Compound Annual Decline Rate $6,033 $5,888 6,000 $5,819 $5,693 $643 $642 $589 $619 $1,736 $566 5,000 $1,745 $1,770 $4,490 $1,721 $1,714 $4,09
Slide 11: Net Interest Income and NIM
11 Net Interest Income and NIM Net Interest Income (NII) and NIM (%) Commentary ($ in millions, except for percentages ) • NIM down primarily on: 60 $56.8 – Lower market rates affecting new loan production and $55.6 $55.4 floating interest earning assets $53.8 $52.6 – Lower investment balances as we
Slide 12: Noninterest Income Mix
12 Noninterest Income Mix Noninterest Income Mix Commentary ($ in millions) • Other noninterest income in first nine months of 2019 16 includes: $14.1 – $2.7 million from derivative transactions sold to 14 $13.8 customers, including $1.3 million recorded in 3Q19 $13.0 $13.2 – $1.9 million gain on mu
Slide 13: Noninterest Expense
Noninterest Expense 13 Noninterest Expense Mix Commentary • 3Q19 Other operating expenses includes $0.8 million of rebranding costs and a ($ in millions, except for FTEs) similar additional amount of rebranding expenses is expected to be incurred by year-end • 3Q19 includes $0.5 million in staff red
Slide 14: Adjusted Noninterest Expense
14 Adjusted Noninterest Expense(1) Adjusted Noninterest Expense Mix Commentary • Since 3Q18, staffing has been reduced by 110 FTEs or 11.6% ($ in millions, except for FTEs) • Modest decline in Salaries and employee benefits expense despite cost of living adjustments of 1.8% effective July 1st (vs. 3
Slide 15: Interest Rate Sensitivity
15 Interest Rate Sensitivity Commentary Loan Portfolio & Repricing Detail • The Company continues to be asset sensitive driven by floating rate loans and (As of September 30, 2019) loans maturing in less than a year Loan Portfolio By Rate Type Loan Portfolio By Interest Type • Given more recent mark
Slide 16: FY19-20 Goals
16 FY19-20 Goals • Continue focus on domestic commercial deposit growth by Net Interest • Improve loan portfolio yield targeting new verticals/niches for while containing deposit costs Deposits deposits Income to preserve NIM • Increase domestic deposits and share of wallet from higher net worth int
Slide 17: Appendices
Appendices
Slide 18: Appendix Non-GAAP Financial Measures Reconciliations
Appendix 1 18 Non-GAAP Financial Measures Reconciliations The following table sets forth selected financial information derived from the Company’s interim unaudited consolidated financial statements, adjusted for certain costs incurred by the Company in the periods presented related primarily to non
Slide 19: Appendix Non-GAAP Financial Measures Reconciliations (cont'd)
Appendix 1 19 Non-GAAP Financial Measures Reconciliations (cont’d) Three Months Ended, Nine Months Ended September 30, September June 30, September ($ in thousands, except per share amounts and percentages) 30, 2019 2019 30, 2018 2019 2018 Net income $ 11,931 $ 12,857 $ 11,551 $ 37,859 $ 31,403 Plus
Slide 20: Appendix Non-GAAP Financial Measures Reconciliations (cont'd)
Appendix 1 20 Non-GAAP Financial Measures Reconciliations (cont’d) Three Months Ended, Nine Months Ended September 30, September June 30, September ($ in thousands, except per share amounts and percentages) 30, 2019 2019 30, 2018 2019 2018 Diluted earnings per share (4) $ 0.28 $ 0.30 $ 0.27 $ 0.88 $
Slide 21: Appendix Non-GAAP Financial Measures Reconciliations (cont'd)
Appendix 1 21 Non-GAAP Financial Measures Reconciliations (cont’d) Three Months Ended, Nine Months Ended September 30, September June 30, September ($ in thousands, except per share amounts and percentages) 30, 2019 2019 30, 2018 2019 2018 Salaries and employee benefits / Average total assets 1.70 %
Slide 22: Appendix Non-GAAP Financial Measures Reconciliations (cont'd)
Appendix 1 22 Non-GAAP Financial Measures Reconciliations (cont’d) (1) Expenses incurred for actions designed to implement the Company’s strategy as a new independent company. These actions include, but are not limited to reductions in workforce, streamlining operational processes, rolling out the A
Slide 23: Thank you
Thank you Investor Relations InvestorRelations@amerantbank.com