Wsfs Financial Corporation · NASDAQ:WSFS
Wsfs Financial — Q3 2020 Earnings Presentation
20 slides from Wsfs Financial's earnings presentation, Oct 22, 2020
Slide 1: WSFS Financial Corporation 3Q 2020 Earnings Supplement
Exhibit 99.2 WSFS Financial Corporation 3Q 2020 Earnings Supplement1 October 22, 2020 1 3Q 2020 Earnings Release Supplement is for the purpose and use in conjunction with our Earnings Release furnished as Exhibit 99.1 to our Form 8-K on October 22, 2020 1
Slide 2: Forward Looking Statements & Non-GAAP
Forward Looking Statements & Non-GAAP Forward Looking Statements: This presentation contains estimates, predictions, opinions, projections and other "forward-looking statements" as that phrase is defined in the Private Securities Litigation Reform Act of 1995. Such statements include, without limita
Slide 3: Table of Contents
Table of Contents Financial Highlights Page 4 Loan & Deposit Growth Page 5 Core Fee Income Trends Page 6 Credit Risk Management CECL Page 7 Loan Modifications Page 8 Selected Portfolios Page 9 NIM Trends & Outlook Page 10 Core PPNR Trends & Outlook Page 11 Capital Position Page 12 Appendix: Reconcil
Slide 4: 3Q 2020 Financial Highlights
3Q 2020 Financial Highlights Solid operating performance with PPNR1 at 1.98% of average assets reflecting diversified business model Significant ACL reserve, strong capital levels, and the approved resumption of share repurchases in 4Q 2020 3Q 2020 • Core PPNR1 of $68.0 million increased $4.4 millio
Slide 5: 3Q 2020 Loan and Deposit Growth
3Q 2020 Loan and Deposit Growth Positive loan growth excluding purposeful run-off portfolios; Significant excess customer liquidity continues Loans - 3Q 2020 vs 2Q 2020 and 3Q 2019 Deposits - 3Q 2020 vs 2Q 2020 and 3Q 2019 Sep Jun Sep 3Q20 $ Annualized YOY $ YOY % Sep Jun Sep 3Q20 $ Annualized YOY $
Slide 6: Core Fee Income Trends
Core Fee Income1 Trends Diversified Business Model Drives Core Fee Income Growth Through 3Q 2020 $50 25.3%2 27.0%2 30.0%2 Core Fee Income % Millions $45 $3 $40 $8 • Core fee income is well diversified with over $5 $5 20 discrete lines of business and products $35 within our three core segments: Bank
Slide 7: Credit Risk Management - CECL
Credit Risk Management - CECL 2 F/Y GDP forecast of (3.7%) in 2020 and 3.7% in 2021 Considerations & Components for 3Q 2020 ACL Y/E Unemployment forecast of 8.8% in 2020 and 6.6% in 20212 GDP Growth by Quarter Unemployment by Quarter • Coverage ratio of 2.74% excluding PPP loans and 3.22% including
Slide 8: Credit Risk Management – Loan Modifications
Credit Risk Management – Loan Modifications As of October 15, 2020, loan modifications declined to 3% of total loan portfolio Loan Modifications Commercial Loan Modifications by Sector As of October 15, 2020 As of October 15, 2020 1 1 ($ in millions) Loan Balances % of Portfolio ($ in millions) Loan
Slide 9: Credit Risk Management – Selected Portfolios
Credit Risk Management – Selected Portfolios Hotel Portfolio Retail CRE Portfolio $516.9 million; 6.1% of loan portfolio1 $734.3 million; 8.6% of loan portfolio1 • 48% of balances Criticized • 7% of balances Criticized • $5.8 million average loan balance size • $1.2 million average loan balance size
Slide 10: Net Interest Margin Trends and 4Q Outlook
Net Interest Margin Trends and 4Q Outlook NIM impacted by rate environment, PPP forgiveness timing, purchase accretion volatility and excess customer liquidity 4.75% • 2Q & 3Q 2020 included full quarter impact of the 150 bps Fed Fund rate decrease and negative 8 bps 4.50% from PPP loans 4.38% 0. • 3
Slide 11: Core PPNR Trends and 4Q 2020 Outlook
Core PPNR1 Trends and 4Q 2020 Outlook Solid Core PPNR Results Despite Challenging Rate Environment $140 2.50% 2.36% • 4Q 2020 Outlook assumes continued gradual Millions 2.36% $120 1.96% 1.98% reopening of the economy, and PPP net income 1.80% - 2.05% 2.00% growth from ~20% of PPP loans forgiven duri
Slide 12: Capital Position
Capital Position Strong Capital Levels and PPNR Run-Rate Result in Significant Capital Return Opportunity1 Bank Common Equity Tier-1 (CET1) Capital Ratio Scenario1 Five Quarters Ending 4Q 2021 16% • PPNR (after-tax) run-rate1 provides approximately 42 bps of CET1 per quarter. After estimated routine
Slide 13: Appendix: Non-GAAP Financial Information
Appendix: Non-GAAP Financial Information 13
Slide 14: Non-GAAP Information
Non-GAAP Information This presentation contains financial measures determined by methods other than in accordance with accounting principles generally accepted in the United States (GAAP). The following are the non-GAAP measures used in this presentation: • Adjusted net income (non-GAAP) is a non-GA
Slide 15: Appendix: 3Q 2020 Reported Financial Results
Appendix: 3Q 2020 Reported Financial Results 3Q 2020 WSFS 3Q 2020 GAAP included the following items that were excluded from Core results: $ in millions (expect per share amounts) • WSFS realized $3.3 million (pre-tax), or approximately $0.05 per share (after-tax), in net gains on sales of securities
Slide 16: Appendix: Non-GAAP Financial Information
Appendix: Non-GAAP Financial Information Three Months Ended (dollars in thousands, except per share data) September 30, 2020 June 30, 2020 March 31, 2020 September 30, 2019 Net interest income (GAAP) $ 113,048 $ 113,756 $ 116,150 $ 120,833 Core net interest income (non-GAAP) $ 113,048 $ 113,756 $ 11
Slide 17: Appendix: Non-GAAP Financial Information
Appendix: Non-GAAP Financial Information Three Months Ended (dollars in thousands, except per share data) September 30, 2020 June 30, 2020 September 30, 2019 GAAP net income (loss) attributable to WSFS $ 51,145 $ (7,111) $ 53,882 Plus/(less): Pre-tax adjustments1 (718) (21,148) (2,467) (Plus)/less:
Slide 18: Appendix: Non-GAAP Financial Information
Appendix: Non-GAAP Financial Information Three Months Ended (dollars in thousands, except per share data) September 30, 2020 June 30, 2020 September 30, 2019 Calculation of return on average tangible common equity: GAAP net income (loss) attributable to WSFS $ 51,145 $ (7,111) $ 53,882 Plus: Tax eff
Slide 19: Appendix: Non-GAAP Financial Information
Appendix: Non-GAAP Financial Information $ in 000's 3Q'20 2Q'20 1Q'20 4Q'19 3Q'19 2Q'19 1Q'19 TTM 4Q'19 Calculation of core PPNR: Net income (loss) (GAAP) $ 50,823 $ (7,811) $ 10,567 $ 45,424 $ 53,595 $ 35,969 $ 12,930 $ 147,918 Plus/(less): Income tax provision (benefit) 15,140 (2,247) 1,288 14,199
Slide 20: Investor Relations Contact
Stockholders or others seeking information regarding the Company may call or write: WSFS Financial Corporation Investor Relations WSFS Bank Center 500 Delaware Avenue Wilmington, DE 19801 302-504-9857 stockholderrelations@wsfsbank.com www.wsfsbank.com Rodger Levenson Dominic C. Canuso Chairman, Pres