Trico Bancshares · NASDAQ:TCBK
Trico Bancshares — Investor Presentation (July 2023)
35 slides from Trico Bancshares's investor presentation, July 2023
Slide 1: Investor Presentation Second Quarter 2023
Investor Presentation Second Quarter 2023 Richard P. Smith, President & Chief Executive Officer Peter G. Wiese, EVP & Chief Financial Officer Dan K. Bailey, EVP & Chief Banking Officer John S. Fleshood, EVP & Chief Operating Officer
Slide 2: Safe Harbor Statement
Safe Harbor Statement The statements contained herein that are not historical facts are forward-looking statements based on management’s current expectations and beliefs concerning future developments and their potential effects on the Company. Such statements involve inherent risks and uncertaintie
Slide 3: Tri Counties Bank
Tri Counties Bank 3 Investor Presentation | Second Quarter 2023
Slide 4: Agenda and Executive Team
Agenda Executive Team (left to right) • Most Recent Quarter Recap • Judi Giem, SVP & Chief Human Resources Officer • Company Overview • Peter Wiese, EVP & Chief Financial Officer • Lending Overview • Dan Bailey, EVP & Chief Banking Officer • Deposit Overview • Rick Smith, President & Chief Executive
Slide 5: Most Recent Quarter Highlights
Most Recent Quarter Highlights Operating Leverage • Pre-tax pre-provision ROAA and ROAE were 1.76% and 15.54%, respectively, for the quarter ended and Profitability June 30, 2023, and 1.74% and 15.70%, respectively, for the same quarter in the prior year • Our efficiency ratio was 58.7% for the quar
Slide 6: Company Overview
Company Overview Nasdaq: TCBK Headquarters: Chico, California Stock Price*: $33.20 Market Cap.: $1.10 Billion Asset Size: $9.85 Billion Loans: $6.52 Billion Deposits: $8.10 Billion Bank Branches: 69 ATMs: 87 Bank ATMs, with access to ~ 40,000 in network Market Area: TriCo currently serves 31 countie
Slide 7: Top of Mind for Today and Tomorrow
“Top of Mind for Today and Tomorrow” Key Executive Management Themes and Topics • New Customer Relationships – Offensive Strategies While Seeking to Drive Alpha and Protect Beta • Active Monitoring of Loans for Early Warning Signs While Maintaining Sufficient Reserves • Terminal Interest Rate and Du
Slide 8: Positive Earnings Track Record
Positive Earnings Track Record July 2018 2020 March 2022 Acquired FNB Bancorp Elevated ACL Provisioning Acquired Valley Republic Bancorp ($1.2B assets) Associated with COVID ($1.4B assets) $40 Related Risks $1.20 $36 $32 $28 Earnings (in Millions) $0.80 $24 Qtrly EPS (diluted) $20 $16 $0.40 $12 $8 $
Slide 9: Shareholder Returns
Shareholder Returns Dividends per Share: 11.4% CAGR* Return on Avg. Shareholder Equity 12.10% 11.67% Q1 Q2 Q3 Q4 $1.10 $1.25 10.75% 10.49% 11.13% $1.00 $1.00 $0.88 $0.30 $0.82 8.10% $0.25 $0.66 $0.70 $0.22 7.18% $0.22 $0.75 $0.19 $0.25 $0.30 $0.17 $0.22 $0.50 $0.22 $0.30 $0.17 $0.17 $0.25 $0.25 $0.1
Slide 10: Consistent Growth
CAGR, Assets 5 yrs. 10 yrs. Consistent Growth 15.2% 13.2% Organic Growth and Disciplined Acquisitions Asset Dollars in Billions. Trailing 10 years Trailing 5 quarters 10 Investor Presentation | Second Quarter 2023
Slide 11: Deposits
Deposits 11 11 Investor Presentation | Second Quarter 2023
Slide 12: Liability Mix: Strength in Funding
Liability Mix: Strength in Funding Liability Mix 06/30/2023 Loans to Core Deposits (%) Borrowings & Other TCBK Peers 120 Subordinated liabilities, Debt, 5.6% 2.0% 100 Time Deposits, 80 5.6% 81.6 80.4 79.5 76.9 76.5 75.9 60 72.6 72.1 71.8 70.1 69.1 66.9 66.4 66.0 40 20 Non Interest- bearing Demand 0
Slide 13: Deposits: Strength in Cost of Funds
Deposits: Strength in Cost of Funds Relationship focused pricing for retention 9,000 $8,714 $8,757 $8,656 and acquisition $8,329 $8,026 $8,095 Continued best in class total deposit Beta, 8,000 $7,237 $7,367 10.8% cycle to date $6,863 $6,992 7,000 $3,583 $3,604 $6,506 $3,678 $6,248 $6,341 $3,502
Slide 14: Deposits by Region
800 700 $1.552 billion, total Prior Quarter $712 Deposits by Region 600 500 400 Northern 300 $380 200 100 $196 $126 $138 - 800 700 600 $1.821 billion, total 500 $618 Greater Chico 400 300 $393 $356 200 $273 100 $181 - 800 Sacramento Valley 700 600 $1.256 billion, total 500 400 300 $390 200 $274 $266
Slide 15: Deposits: Demand & Savings Deposit Mix
Deposits: Demand & Savings Deposit Mix Total Demand & Savings Balance Tier, $ millions [1] Consumer ($ millions exterior, count interior) Business Prior Quarter, Total 359 # 34,961 Business 1,431 $3,348 Consumer $3,806 # 204,380 1,656 944 539 308 486 495 462 474 [1] Excludes time deposits, bank owne
Slide 16: Liquidity
TCBK Liquidity Pledged Securities as % of Total Securities [3] Peers 49.7 42.9 45.1 43.4 In addition to a strong 40.1 39.1 37.5 37.2 35.7 36.5 35.6 35.1 34.2 deposit base, the bank maintains a variety of 33.9 35.9 31.6 easily accessible funding 25.2 25.2 25.1 sources 21.5 21.9 21.8 22.8 19.0 17.6
Slide 17: Loans and Credit Quality
Loans and Credit Quality 17 17 Investor Presentation | Second Quarter 2023
Slide 18: Loan Portfolio and Yield
Loan Portfolio and Yield 6.50% $6,452 $6,521 $6,422 $6,313 $6,097 $6,000 $5,796 $5,000 $4,859 $4,711 $4,739 5.44% $4,610 5.50% $4,381 $4,386 $4,407 $4,443 $4,000 $4,111 5.38% $4,022 5.15% 5.24% 5.09% 5.23% 5.21% 4.92% 4.96% 5.10% 5.05% $3,000 4.86% 4.88% 4.78% 4.69% 4.73% 4.50% $2,000 $1,000 $0 3.50
Slide 19: Gross Production vs. Payoff
Gross Production vs. Payoff In addition to the nearly $0.8 Originations and net loan TCBK originated nearly $1.5 billion in non-PPP loan growth in 2022 were supportive billion in 2021, while facing originations in 2020, TCBK of the positive mix shift in headwinds of an increased $372 originated over
Slide 20: Diversified Loan Portfolio
Diversified Loan Portfolio CRE Non- Multifamily Occupied Occupied 2Q-2023 $2,143 Owner 2Q-2022 $1,997 2Q-2023 $972 Owner CRE- 2Q-2022 $926 2Q-2023 $952 2Q-2022 $870 2Q-2023 $830 SFR 1-4 Term 2Q-2022 $720 Agriculture & Auto & Other HELOC Commercia Construction Farmland 1% Industrial 2Q-2023 $576 4% 5
Slide 21: Office RE Collateral
Office RE Collateral TCBK Community Net Book Balance Wtd Avg Loan Count Commitments Net Book Balance CRE loans secured Banking Regions (Avg) LTV Central Valley 300 $ 317,958,535 $ 283,282,622 $ 944,275 60.8% by office collateral Bay Area 122 172,467,814 159,587,259 1,308,092 51.3% represents 9.5%
Slide 22: CRE Collateral Values
CRE Collateral Values Distribution by LTV (1) 100% LTV Range 90% <= 60% > 60% - 75% 89% 80% > 75% 79% 70% 70% 71% 60% 62% 60% 50% 51% 48% 46% 45% 40% 38% 39% 30% 28% 25% 20% 21% 10% 11% 2% 3% 0% 0% 0% 4% 1% 7% 0% Retail Building Office Building Hotel/Motel Light Industrial Self Storage Other Multifa
Slide 23: Unfunded Loan Commitments
Unfunded Loan Commitments HELOCs – by vintage, with weighted avg. coupon (7.70% total WAC) Outstanding Principal ($MM) 9.14% 9.15% $250 8.73% 8.74% 8.59% 8.66% 8.70% 8.92% 8.48% 10.00% Unfunded Commitment ($MM) 8.45% 8.34% 9.00% 7.98% 7.91% $225 8.00% $200 6.53% 6.65% $173 7.00% $175 6.00% $150 $170
Slide 24: C&I Utilization
C&I Utilization C&I Utilization by NAICS Industry: 2Q-2023 C&I yield is expected to grow $203 $198 incrementally through the 20000% Outstanding (mln) Unfunded (mln) $175 remainder of 2023. 15000% $84 Paired with treasury 10000% $62 $70 $64 $48 $48 $48 $51 $52 management services, C&I 5000% $24 $
Slide 25: Loan Yield Composition
Floating 13% Loan Yield Composition Fixed 44% 56% Adjustable + Floating 99% of Floating Predominantly benchmarked benchmarked to Prime to 5 Year Treasury Adjustable 43% 1,000 10.00% 8.89% 900 9.00% 8.95% 800 8.00% 7.21% 700 6.97% 7.07% 6.98% 7.00% 6.69% 6.71% 600 6.00% 5.74% 500 5.03% 5.00% 4.66% 4.
Slide 26: Allowance for Credit Losses: Drivers of Change under CECL
Allowance for Credit Losses Drivers of Change under CECL 1.80% of Total Loans Loan portfolio Gross charge-offs Two relationships Econometric growth of $98 $0.276 million added to the factors for million in Q2 specifically Unemployment 1.69% Gross recoveries analyzed and Corporate $0.218 mi
Slide 27: Allowance for Credit Losses: Allocation by Segment
Allowance for Credit Losses Allocation of Allowance by Segment 27 Investor Presentation | Second Quarter 2023
Slide 28: Risk Grade Migration
Risk Grade Migration 1.1% 0.8% 0.8% 1.1% 1.0% 1.0% 1.6% 2.1% 1.8% 2.0% 2.0% 2.4% 7.8% 9.5% 9.7% 8.0% 9.2% 8.8% 89.6% 87.6% 87.8% 89.0% 87.8% 87.8% 1Q-2022 2Q-2022 3Q-2022 4Q-2022 1Q-2023 2Q-2023 Pass Watch Special Mention Substandard Zero balance in Doubtful and Loss 28 Investor Presentation | Sec
Slide 29: Asset Quality
Asset Quality Overall portfolio credit trends Non-Performing Assets as a % of Total Assets TCBK Peers remain below historic averages 0.75% 0.68% with loans past due 30+ days to 0.58% 0.64% 0.60% total loans of 0.15% at quarter end. 0.53% 0.50% 0.46% 0.42% 0.38% 0.38% 0.37% 0.38% 0.37% 0.40% 0.34%
Slide 30: Financials
Financials 30 30 Investor Presentation | Second Quarter 2023
Slide 31: Net Interest Income (NII) and Margin (NIM)
Net Interest Income (NII) and Margin (NIM) 31 Investor Presentation | Second Quarter 2023
Slide 32: Net Interest Income (NII) and Margin (NIM)
Net Interest Income (NII) and Margin (NIM) 32 Investor Presentation | Second Quarter 2023
Slide 33: Current Operating Metrics
Current Operating Metrics Net Interest Margin (FTE) Efficiency Ratio 4.30% 4.47% 4.22% 4.08% 3.96% 3.88% 3.58% 65.4% 63.7% 59.7% 58.4% 53.2% 53.0% 54.4% 2017 2018 2019 2020 2021 2022 2023 2017 2018 2019 2020 2021 2022 2023 PPNR as % of Average Assets ROAA 1.43% 1.43% 1.94% 1.91% 1.97% 1.97% 1.24% 1.
Slide 34: Well Capitalized
Well Capitalized Tier 1 Capital Ratio CET1 Ratio 14.4% 14.2% 13.3% 14.0% 13.2% 13.7% 12.9% 13.2% 12.5% 12.7% 12.0% 12.4% 11.7% 11.7% 2017 2018 2019 2020 2021 2022 2023 2017 2018 2019 2020 2021 2022 2023 Total Risk Based Capital Tangible Capital Ratio 15.4% 10.6% 15.1% 15.2% 14.4% 14.5% 9.3% 9.5% 9.3
Slide 35: XYZ
Pending update – no material change to format XYZ 35 Investor Presentation | Second Quarter 2023