Western Alliance Bancorporation · NYSE:WAL
Western Alliance Bancorporation — Q1 2022 Earnings Presentation
18 slides from Western Alliance Bancorporation's earnings presentation, Apr 22, 2022
Slide 1: Earnings Call 1st Quarter 2022
EARNINGS CALL 1st Quarter 2022 APRIL 22, 2022
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements that relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. Examples of forward-looking statemen
Slide 3: Highlights: 1st Quarter 2022 Financial Highlights
Highlights 1st Quarter 2022 | Financial Highlights Earnings & Profitability Q1-22 Q4-21 Q1-21 $240.1 $246.0 $192.5 Net Income Net Income EPS Net Revenue $555.8 $561.0 $337.0 Pre Provision Net Revenue1 $307.2 $323.2 $202.0 $240.1 million $2.22 Net Interest Margin 3.32% 3.33% 3.37% Efficiency Ratio1 4
Slide 4: Quarterly Income Statement
Q1 2022 Highlights Quarterly Income Statement Q1-22 Q4-21 Q1-21 Net Interest Income decreased $1.1 million, Net Interest Income $449.5) 1 $450.6) $317.3) 1 primarily from two fewer business days and the Mortgage Banking Related Income 78.0) 75.5) -) quarterly capture of credit linked notes issued in
Slide 5: Net Interest Drivers
Q1 2022 Highlights Net Interest Drivers Total Investments and Yield Loans and HFI Yield • Loan yields decreased 5 bps following 2.47% 2.77% 4.59% 4.48% 4.28% continued mix shift into residential loans 2.37% 2.46% 2.51% 4.03% 3.98% and lower prepayment and PPP fees $5.6 $4.8 $7.9 $7.8 $7.7 $8.3 $7.5
Slide 6: Net Interest Income
Q1 2022 Highlights Net Interest Income Net Interest Income and Net Interest Margin Average Earning Assets & Average Yield • Net Interest Income decreased $1.1 million, or 0.2%, over prior quarter Dollars in millions Dollars in billions primarily due to two fewer business days 3.55% 3.77% 3.70% 3.57%
Slide 7: Net Interest Income in a Rising Rate Environment
Highlights Net Interest Income in a Rising Rate Environment • WAL expects a 6.8% increase in NII under a NII Sensitivity – Shock Scenario, +100 bps 100bps rate shock on a static balance sheet Static Balance Sheet • Nearly 57% of loans (ex-HFS) are contractually Growth Balance Sheet variable ($23.3 b
Slide 8: Expenses and Efficiency
Q1 2022 Highlights Expenses and Efficiency1 • Efficiency ratio1 increased 230 bps to Non-Interest Expenses and Efficiency Ratio 44.1% compared to the prior quarter and increased 500 bps from the same period 47.5% last year 44.1% • Higher efficiency ratio1 was driven by the 42.0% 41.8% modest decline
Slide 9: Pre-Provision Net Revenue, Net Income, and ROA
Q1 2022 Highlights Pre-Provision Net Revenue1, Net Income, and ROA • PPNR1 decreased $16.0 million from the PPNR, Net Income & ROA prior quarter and increased $105.2 million, or 52.1%, from the same period last year 2.43% 2.23% • PPNR ROA1 decreased 13 bps from the 2.03% 2.18% 2.10% prior quarter an
Slide 10: Consolidated Balance Sheet
Q1 2022 Highlights Consolidated Balance Sheet Q1-22 Q4-21 Q1-21 Loans increased $2.0 billion, or 21.2% 1 annualized and $12.4 billion, or 43.2% Investments & Cash $10,879 $8,057 $13,235 over prior year Loans, HFS 4,762 5,635 - Loans HFI, net 41,119 1 39,075 28,711 Deposits increased $4.5 billion, or
Slide 11: Five Quarter Loan Growth and Composition
Highlights Five Quarter Loan Growth and Composition Quarter-over-quarter loan growth of $12.4 Billion Year-Over-Year Growth $2.0 billion driven by (in millions): Residential & Consumer $1,994 Total Loans, HFI $28.7 $30.0 $34.8 $39.1 $41.1 CRE, Non-OO 323 Qtr. Change +$1.6 +$1.3 +$4.8 +$4.3 +$2.0 Con
Slide 12: Five Quarter Deposit Growth and Composition
Highlights Five Quarter Deposit Growth and Composition Quarter-over-quarter deposit growth of $13.8 Billion Year-Over-Year Growth $4.5 billion driven by (in millions): Non-Interest Bearing DDA $2,167 Total Deposits $38.4 $41.9 $45.3 $47.6 $52.1 Interest-Bearing DDA 1,344 Qtr. Change +$6.5 +$3.5 +$3.
Slide 13: Asset Quality
Q1 2022 Highlights Asset Quality Classified Assets Special Mention Loans • Total Classified Assets of $365 million (60 $365 bps to Total Assets) increased $64 million in Q1 $301 1.65% $281 1.35% $265 1.05% • Classified Assets increased due to $238 0.85% 0.85% $262 $474 temporary impact of Omicron va
Slide 14: Credit Losses and ACL Ratios
Q1 2022 Highlights Credit Losses and ACL Ratios Allowance for Credit Losses Gross Charge-offs and Recoveries • Provision expense of $9.0 million, driven by strong loan growth $3 Gross Charge Offs $9 $5 $5 $43 $33 $6 $32 $37 Recoveries • Total Loan ACL / Funded Loans decreased $31 1 bps to 0.73% in Q
Slide 15: Capital Accumulation
Q1 2022 Highlights Capital Accumulation Robust Common Capital Levels Regulatory Capital Levels • Exceed “well-capitalized” levels and are stable 10.3% after the initial impact of the AmeriHome 9.2% 9.1% 9.0% 7.9% 8.7% transaction 7.1% 6.9% 7.3% 6.7% • CET1 at 9.0% Tangible Common Equity / Tangible A
Slide 16: Tangible Book Value Growth
Highlights Tangible Book Value Growth Long-Term Growth in TBV per Share1 Tangible Book Value per Share1 WAL • TBVPS decreased $0.71 to $37.13 from prior WAL with Dividends Added Back 165% quarter Peer Avg • Increased 12.4% year-over-year Peer Avg with Dividends Added Back 145% • Decreased 1.9% quart
Slide 17: Management Outlook
Management Outlook Balance Sheet Growth Net Interest Income Pre-Provision Net Revenue Capital and Liquidity 17
Slide 18: Questions & Answers
ee M\VAN | Nes Wester Alliance Questions & Answers
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