Cvb Financial Corporation · NASDAQ:CVBF
Cvb Financial — Investor Presentation (October 2024)
59 slides from Cvb Financial's investor presentation, Oct 24, 2024
Slide 1: CVB Financial Corp.
Exhibit 99.1 CVB Financial Corp. October 2024
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements that are intended to be covered by the safe harbor for such statements provided by the Private Securities Litigation Reform Act of 1995. These statements are based on the current beliefs and expectations of the manageme
Slide 3: CVB Financial Corp. (CVBF) at a glance
Total Assets: $15.4 Billion Gross Loans: $ 8.6 Billion Total Deposits (Including Repos):$12.5 Billion Total Equity: $ 2.2 Billion CVB Financial Corp. (CVBF) Largest financial institution headquartered in the Inland Empire region of Southern California. Founded in 1974.
Slide 4: Bank Accomplishments & Ratings
As of 10/11/2024 CVB Financial Corp. is the holding company for Citizens Business Bank SNL Financial ranking of largest bank holding companies in CA, as of 12/31/2023 Bank Accomplishments & Ratings 190 Consecutive Quarters of Profitability 140 Consecutive Quarters of Cash Dividends Forbes, Best Bank
Slide 5: Business Financial Centers and CitizensTrust Locations
62 Business Financial Centers 3 CitizensTrust Locations Corporate Office Business Financial Centers CitizensTrust
Slide 6: Our Vision
Our Vision Citizens Business Bank will strive to become the premier financial services company operating throughout the state of California, servicing the comprehensive financial needs of successful small to medium sized businesses and their owners.
Slide 7: Target Customer
Target Customer The best privately-held and/or family-owned businesses throughout California Annual revenues of $1-300 million Top 25% in their respective industry Full relationship banking Build long-term relationships
Slide 8: Three Areas of Growth
Three Areas of Growth DeNovo San Diego (2014) Oxnard (2015) Santa Barbara (2015) San Diego (2017) Stockton (2018) Modesto (2020) Acquisitions American Security Bank (2014) County Commerce Bank (2016) Valley Business Bank (2017) Community Bank (2018) Suncrest Bank (2022)
Slide 9: Relationship Banking Model
Relationship Banking Model Relationship Manager (Bank) Real Estate International Services Treasury Management Specialty Banking Construction Lending CitizensTrust/ Wealth Management Bankcard/ Processing SBA Citizens Home Lending Marketing Citizens Equipment Financing Government Services Customer Cre
Slide 10: Acquisition Strategy
Acquisition Strategy Target size: $1 billion to $10 billion in assets Financial & Strategic In-market and/or adjacent geographic market (California) Banks: Banking Teams: In-market New markets
Slide 11: CVBF Balance Sheet Profile
CVBF Balance Sheet Profile TCE Tier 1 Leverage CET1 Tier 1 RBC Total RBC 9.7% 10.6% 15.8% 15.8% 16.6% Assets $15.4B Securities $4.9B Loans $8.6B Deposits & Repos $12.5B Funding $13.0B September 30, 2024 Capital Ratios as of September 30, 2024
Slide 12: Q3 2024 Financial Highlights
Q3 2024 Financial Highlights Profitability ROATCE = 14.93% ROAA = 1.23% Efficiency Ratio = 46.53% Income Statement Q3’24 Net Income = $51 million / EPS = $0.37 NIM = 3.05% 2.4% increase in net income $9.1 million gain on sale/leaseback transactions $11.6 million loss on sale of AFS securities Balanc
Slide 13: Selected Ratios
Selected Ratios 2021 2022 2023 Q3’23 Q2’24 Q3’24 ROATCE 15.93% 18.85% 18.48% 18.82% 15.51% 14.93% NIM 2.97% 3.30% 3.31% 3.31% 3.05% 3.05% Cost of Deposits 0.04% 0.05% 0.41% 0.52% 0.88% 0.98% Cost of Funds 0.05% 0.06% 0.83% 0.92% 1.38% 1.47% Efficiency Ratio* 41.09% 38.98% 42.00% 39.99% 45.10% 46.53%
Slide 14: Selected Highlights: Income Statement
Selected Highlights ($ in Thousands) Q3’23 Q2’24 Q3’24 Net Interest Income $ 123,371 $ 110,849 $ 113,619 Noninterest Income 14,309 14,424 12,834 Noninterest Expense, excluding Regulatory Assessments 52,877 55,083 56,732 Regulatory Assessments 2,181 1,414 2,103 Total Noninterest Expense 55,058 56,497
Slide 15: Selected Highlights: Average Balance Sheet
Selected Highlights ($ in Thousands) Q3’23 Q2’24 Q3’24 Average Cash & Cash Equivalents $ 644,006 $ 866,747 $ 1,379,054 Average Loans 8,862,462 8,731,587 8,605,270 Average Total Securities 5,542,590 5,206,959 5,080,033 Average Noninterest-bearing Deposits 7,813,120 7,153,315 7,124,952 Average Total D
Slide 16: Pretax-Pre Provision Income
Pretax-Pre Provision Income PTPP income (Non -GAAP*) Q3’24 excludes gain (loss) PTPP ROAA (Non-GAAP*) Q3’24 excludes gain (loss) We use certain non-GAAP financial measures to provide supplemental information regarding our performance. Excluding $9.2 million FDIC special assessment, Q4’23 PTPP income
Slide 17: Return on Average Assets
Return on Average Assets * Source: As calculated by S&P Capital IQ. Unweighted Average NASDAQ Regional Banking Index KRX
Slide 18: Return on Average Tangible Common Equity
Return on Average Tangible Common Equity * Source: As calculated by S&P Capital IQ. Unweighted Average NASDAQ Regional Banking Index KRX
Slide 19: Dividends – Consecutive Quarters
Dividends – 140 Consecutive Quarters 140 Consecutive Quarters More than 30 years of cash dividends since 1989 Dividend payout ratio calculated on per share basis. Annualized based on YTD dividends/YTD net earnings ANNUALIZED*
Slide 20: Earnings Per Share
Earnings Per Share 190 Consecutive Quarters of Profitability since 1977 ANNUALIZED* Annualized based on YTD Q3’24 EPS.
Slide 21: Strong Capital Ratios
Strong Capital Ratios $1B $946mm $748mm $657mm * Source: S&P Capital IQ. Unweighted Average NASDAQ Regional Banking Index KRX (50 Banks)
Slide 22: CET1 Ratio Trend (%)
CET1 Ratio Trend (%) * Source: S&P Capital IQ. Unweighted Average NASDAQ Regional Banking Index KRX
Slide 23: TCE Ratio Trend (%)
TCE Ratio Trend (%) * Source: S&P Capital IQ. Unweighted Average NASDAQ Regional Banking Index KRX Suncrest Q1’22 ASR program: ~3mm shares
Slide 24: Loans by Type
Loans by Type CRE $6.62B C&I $0.94B Other $1.02B
Slide 25: Loan Trends – Quarterly Averages
Loan Trends – Quarterly Averages ($ in Millions) 3.2% decline 0.4% growth -7.3% decline 6.1% growth
Slide 26: Line Utilization Trends
Line Utilization Trends Total D&L C&I
Slide 27: ACL Nine Quarter Trend
ACL Nine Quarter Trend ($ in Millions) * Total Balance
Slide 28: Classified Loan Trend
Classified Loan Trend ($ in Millions)
Slide 29: Net Charge-Offs / Average Loans (%)
Net Charge-Offs / Average Loans (%) * Source: S&P Capital IQ. Unweighted Average NASDAQ Regional Banking Index KRX
Slide 30: Classified Loans / Total Loans (%)
Classified Loans / Total Loans (%) * Source: S&P Capital IQ. Unweighted Average NASDAQ Regional Banking Index KRX
Slide 31: Owner/Non-Owner Occupied Commercial Real Estate Loans
Owner/Non-Owner Occupied Commercial Real Estate Loans Collateral Type
Slide 32: CRE by Collateral
CRE by Collateral Collateral Type Balance % of Owner Occupied LTV at Origination Avg. Size Classified Classified (Non- Owner) Classified (Owner) Industrial $ 2,238 48% 49% $ 1.62 $ 15.98 $ 8.27 $ 7.71 Office 1,058 26% 55% 1.68 7.50 7.50 0.00 Retail 911 11% 48% 1.71 25.13 25.13 0.00 Multi-Family 828
Slide 33: CRE by Collateral and Origination
CRE by Collateral and Origination Balance Distribution by Origination Year Average OLTV By Origination Year Collateral Type Balance 2024 2023 2022 2021 2020 2019 or earlier 2024 2023 2022 2021 2020 2019 or earlier Industrial $ 2,238 4% 9% 20% 19% 10% 38% 42% 43% 44% 50% 49% 53% Office 1,058 2% 3% 24
Slide 34: CRE by Collateral and Reset/Maturity
CRE by Collateral and Reset/Maturity Collateral Type Balance ($ in Millions) Balance Maturing Next 24 months ($ in Millions) Rate Resets Next 24 Months ($ in Millions) Maturity & Rate Reset % of Loans Industrial $ 2,238 $ 218 $ 149 16% Office 1,058 118 126 23% Retail 911 108 115 24% Multi-Family 828
Slide 35: CRE by Collateral and Loan Size
CRE by Collateral and Loan Size ($ in Millions) Loan Amount Industrial Office Retail Multi-Family Other Farmland Medical Other RE Rental and Leasing Total Greater than $20M $ 0 $ 23 $ 0 $ 0 $ 0 $ 22 $ 0 $ 24 $ 69 $10M to $20M 107 113 97 87 11 74 0 24 513 $5M to $10M 445 244 137 131 157 77 65 41 1,29
Slide 36: CRE Office Loans by Major MSA
CRE Office Loans by Major MSA Los Angeles County Total Balance of $375mm (193 loans) San Francisco County Total Balance of $218,029 (1 loan) San Diego County Total Balance of $73mm (21 loans) Note: Only shows the office loans that are in the major MSA.
Slide 37: Greater LA Business Density Distribution
Greater LA Business Density Distribution Note: Darker Shaded areas represent higher density of businesses within each submarket (HBD) West LA includes Santa Monica and Century City Central LA includes Downtown LA North LA includes Pasadena and Burbank Other LA (includes remaining areas of LA) Market
Slide 38: Greater SD Business Density Distribution
Greater SD Business Density Distribution Area ($ in thousands) $ Loan Balance % of Owner Occupied LTV at Origination Avg. Size Classified Downtown SD (HBD) $ 3,718 41% 54% $ 1,239 $ 0 Other SD 69,290 0% 53% 3,849 0 Total $ 73,008 2% 53% $ 3,477 $ 0 Darker shaded areas represent Higher Business Densi
Slide 39: Greater SF Business Density Distribution
Greater SF Business Density Distribution Area ($ in thousands) $ Loan Balance % of Owner Occupied LTV at Origination Avg. Size Classified Downtown SF (HBD) $ 218 0% 3% $ 218 $ 0 Other SF 0 0% 0% 0 0 Total $ 218 0% 3% $ 218 $ 0 Darker shaded areas represent Higher Business Density (HBD)
Slide 40: C&I by Industry
C&I by Industry Industry Balance ($ in Millions) % of C&I Total Classified ($ in Millions) Real Estate Rental and Leasing $ 203 22% $ 0.14 Manufacturing 111 12% 2.61 Wholesale Trade 92 10% 3.64 Construction 78 8% 0.08 Arts, Entertainment, and Recreation 66 7% 0.00 Administrative and Support and Wast
Slide 41: Total Deposits & Customer Repos
Total Deposits & Customer Repos Cost of Interest-Bearing Deposits and Repos September 2024 2.41% December 2023 1.60%
Slide 42: Diverse Deposit Base
Diverse Deposit Base Manufacturing Consumer 8% 27% Retail Trade. Construction 2% 1h Transportation and Warehousing 2% Other Real Estate Rental and Leasing 6% Properly Management Wholesale Trade. Public Administration Professional, Scientific, and 5% 3% “Other Industries include various industries th
Slide 43: Business vs Consumer Deposits
Business vs Consumer Deposits Q3 2024 Q1 2022
Slide 44: Deposit Relationship Tenure
Deposit Relationship Tenure Q1 2022 Q4 2023 Q3 2024 ~75% of our customer deposit relationships have banked with CBB for 3 years or more
Slide 45: Brokered Deposits / Total Deposits (%)
Brokered Deposits / Total Deposits (%) * Source: S&P Capital IQ. Unweighted Average NASDAQ Regional Banking Index KRX
Slide 46: Cost of Deposits
Cost of Deposits For the Last 5 Years CVBF Ranked Among the 5 Lowest Cost of Deposits of the 50 Banks in the KRX Index Source: As calculated by S&P Capital IQ. Unweighted Average NASDAQ Regional Banking Index KRX (50 Banks) Current rate cycle to date*: CVBF deposit beta = 21% *Measured as the growth
Slide 47: Cost of Deposits: Monthly Trends
Cost of Deposits: Monthly Trends CVBF Cost of Deposit Detail
Slide 48: Net Interest Income and NIM
Net Interest Income and NIM ($ in Millions)
Slide 49: Net Interest Margin Trend
Net Interest Margin Trend * Source: As calculated by S&P Capital IQ. Unweighted Average NASDAQ Regional Banking Index KRX
Slide 50: Appendix Non-GAAP Reconciliation
Appendix Non-GAAP Reconciliation
Slide 51: Loan Trends
Loan Trends *Other includes other loan segments that are not listed above, such as Construction, SFR Mortgage, and SBA. Q3 2024 vs Q3 2023 Total ($305) 3% decline C&I ($2) D&L and Agribus. ($9) CRE ($224) 3% decline Other ($70) ($ in Millions)
Slide 52: Loans by Region
($ in Thousands) # of Center Locations (9/30/24) Average Loans per Location Total Loans (9/30/24) % Los Angeles County 21 $ 147,181 $ 3,090,804 36.1% Central Valley and Sacramento 15 136,234 2,043,515 23.8% Orange County 10 117,013 1,170,127 13.7% Inland Empire (Riverside & San Bernardino Counties)
Slide 53: Deposits by Region
Deposits by Region ($ in Thousands) # of Center Locations (9/30/24) Total Deposits (6/30/24) Total Deposits (9/30/24) Average Deposits per Center (9/30/24) Los Angeles County 21 $4,747,831 $5,064,135 $241,149 Inland Empire (Riverside & San Bernardino Counties) 9 3,632,739 3,531,569 392,397 Central V
Slide 54: Economic Forecast – GDP
3.50 3.00 2.50 2.00 1.50 1.00 0.50 (0.50) (1.00) (1.50) > ¢ e s Economic Forecast — GDP Real GDP Growth s 2 Q2 2024 Forecast s * gs 8 gg 2 Q3 2024 Forecast cbbank.com
Slide 55: Economic Forecast – Unemployment
Economic Forecast – Unemployment Q1 2024 ForecastQ2 2024 Forecast
Slide 56: Economic Forecast – CRE Price
Economic Forecast – CRE Price
Slide 57: Reconciliation of PTPP Return on Average Assets (Non-GAAP)
Reconciliation of PTPP Return on Average Assets (Non-GAAP) The Pretax-pre provision income (“PTPP”) return on average assets is a non-GAAP disclosure. We use certain non-GAAP financial measures to provide supplemental information regarding our performance. We believe that presenting the return on av
Slide 58: Reconciliation of Return on Average Tangible Common Equity (Non-GAAP)
Reconciliation of Return on Average Tangible Common Equity (Non-GAAP) The return on average tangible common equity is a non-GAAP disclosure. We use certain non-GAAP financial measures to provide supplemental information regarding our performance. We believe that presenting the return on average tang
Slide 59: Copy of presentation at www.cbbank.com
Copy of presentation at www.cbbank.com