Stifel Financial Corporation · NYSE:SF
Stifel Financial — Q4 2020 Earnings Presentation
19 slides from Stifel Financial's earnings presentation, Jan 29, 2021
Slide 1: 4th Quarter & Full Year 2020 Financial Results Presentation
4 Quarter & Full Year 2020 th Financial Results Presentation January 29, 2021 Quarterly Earnings Report
Slide 2: 2020 Snapshot
2020 Snapshot 2020 RESULTS millions, except per share and ratios NET REVENUE PRE-TAX MARGIN NET EARNINGS GAAP & NON-GAAP $3,752 GAAP 17.4% NON-GAAP 19.0% GAAP $476 NON-GAAP $523 EPS ROE ROTCE GAAP $4.16 NON-GAAP $4.56 GAAP 14.0% NON-GAAP 15.4% GAAP 22.5% NON-GAAP 24.7% HIGHLIGHTS Record Full Year Re
Slide 3: 2020 Results Surpassed Original Guidance Despite Volatile Market Conditions
2020 Results Surpassed Original Guidance Despite Volatile Market Conditions Actual Original Guidance Actual (millions) 2019 2020 2020 Net Revenue $3,337 $3,500 - $3,700 $3,752 Net Interest Income $547 $590 - $605 $458 Compensation Ratio 58.3% 57% - 59% 59.9% Operating Non-Compensation Ratio1 20.1% 1
Slide 4: Fourth Quarter Snapshot
Fourth Quarter Snapshot 4Q20 RESULTS millions, except per share and ratios NET REVENUE NET EARNINGS EPS GAAP & NON-GAAP $1,060 GAAP $181 NON-GAAP $195 GAAP $1.55 NON-GAAP $1.67 ANNUALIZED ROE ANNUALIZED ROTCE BOOK VALUE PER SHARE GAAP 20.0% NON-GAAP 21.6% GAAP 30.8% NON-GAAP 33.3% TBV $23.58 BV $35.
Slide 5: Fourth Quarter Results
Fourth Quarter Results FINANCIAL RESULTS FOURTH QUARTER HIGHLIGHTS Sequential millions 4Q20 Y/Y Change 2020 VS 2019 ■ Record Quarterly: Change Global Wealth Management $575 4% 9% $2,191 3% ■ Non-GAAP Net Revenue of $1.06 billion, up 12% Y/Y ■ Institutional Group Revenue of $489 million, up 25% Y/Y I
Slide 6: Global Wealth Management
Global Wealth Management GLOBAL WEALTH MANAGEMENT REVENUE HIGHLIGHTS Sequential millions 4Q20 Y/Y Change 2020 VS 2019 ■ Record Full Year Net Revenue of $2.2 billion, up 3% Y/Y Change Brokerage $186 7% 14% $687 6% ■ Second Strongest Quarterly Net Revenue of $575 million Asset Management & Service Fee
Slide 7: Wealth Management Metrics
Wealth Management Metrics RECRUITING DRIVES REVENUE GROWTH DYNAMIC BUSINESS $250 300 ■ 85% of FAs joined Stifel in past 10 years came through organic 275 recruiting, 15% through acquisitions $200 250 Financial Advisors 225 200 ■ Recruiting remotely during pandemic $150 millions 175 150 ■ Growth of a
Slide 8: Institutional Group
Institutional Group INSTITUTIONAL GROUP REVENUE HIGHLIGHTS Sequential millions 4Q20 Y/Y Change 2020 VS 2019 Change ■ Record Results: Advisory $173 12% 115% $428 -4% ■ Full year Revenue & Quarterly Revenue Capital Raising $155 37% 20% $488 47% ■ Full Year & Quarterly Capital Raising Revenue Brokerage
Slide 9: Institutional Equities & Fixed Income
Institutional Equities & Fixed Income INSTITUTIONAL EQUITIES REVENUE INSTITUTIONAL FIXED INCOME REVENUE Sequential Sequential millions 4Q20 Y/Y Change 2020 VS 2019 millions 4Q20 Y/Y Change YTD VS 2019 Change Change Brokerage $69 51% 28% $257 54% Brokerage $88 26% -9% $405 58% Capital Raising $104 62
Slide 10: Investment Banking Revenue
Investment Banking Revenue INVESTMENT BANKING REVENUE HIGHLIGHTS Sequential millions 4Q20 Y/Y Change YTD VS 2019 ■ Record Full Year Investment Banking Revenue, up 16% Change Capital Raising: ■ Record Capital Raising Revenue, up 42% ■ Record Quarterly Investment Banking Revenue Equity $111 58% 31% $3
Slide 11: Net Interest Income
Net Interest Income CONDENSED NET INTEREST INCOME NET INTEREST COMMENTARY 4Q20 Y/Y Change Sequential Change ■ 4Q20 Net Interest Income at Midpoint of Previous Guidance Range. Average Average Average Average Average Average Balance Interest Balance Interest Balance Interest ■ Interest Earning Assets
Slide 12: Stifel Bancorp Inc. Loan & Investment Portfolio
Stifel Bancorp Inc. Loan & Investment Portfolio LOAN PORTFOLIO COMMERCIAL PORTFOLIO BY SECTOR % of Total millions 4Q20 Portfolio Residential Real Estate $3,957 28% Financials $1,063 8% Securities Based Lending 1,934 14% Industrials 660 5% Home Equity lines of Credit & Other $116 1% Consumer Discreti
Slide 13: CECL & Credit Metrics
CECL & Credit Metrics CECL 4Q20 FACTORS ASSUMPTIONS Economic Economic Economic Factors& Factors & Factors & • Moody’s Forecast Portfolio Portfolio Portfolio • 40% Baseline (gradual recovery) Changes Changes Changes ($1.3) $0.0 • 30% Downside (double dip recession) $19.1 • 30% Upside (accelerated rec
Slide 14: Capital & Liquidity
Capital & Liquidity FIRM-WIDE ASSETS & CAPITAL RATIOS HIGHLIGHTS $27,000 $26,604 25.0% ■ Sweep Balances Continued to Increase in 4Q20 $25,896 $25,624 23.0% ■ Capital Ratios Increased from 3Q20 $26,000 $25,549 21.0% $25,000 $24,610 ■ Projecting Balance Sheet Growth of up to $2 billion in 2021 20.2% 1
Slide 15: Expenses and Non-GAAP Reconciliation
Expenses NON-GAAP EXPENSES & PRE-TAX INCOME EXPENSE RATIOS Sequential millions 4Q20 Y/Y Change 2020 VS 2019 63% 25% Change Non-compensation Ratio 62% Compensation Ratio Compensation $614 11% 17% $2,249 16% 20% 61% 62.5% Ex. IB Gross Up & Loan Loss Provision $179 -1% 3% $707 5% 60% 15% 59% 60.0% Loan
Slide 16: 2021 Growth Drivers
2021 Growth Drivers GLOBAL WEALTH MANAGEMENT INSTITUTIONAL GROUP ■ Recruiting Pipelines Remain at Record Levels ■ Investment Banking Pipelines at Beginning of 2021 Larger than at the Start of 2020 for both Advisory and Capital Raising ■ Continued Client Asset Migration from Second Half of 2020 ■ Pub
Slide 17: 2021 Guidance & Track Record of Substantial Growth
2021 Guidance & Track Record of Substantial Growth 2021 Guidance Forecasts Continued Growth & Expense Discipline Actual Consensus Guidance (millions) 2020 2021 2021 Net Revenue $3,752 $3,697 $3,800 - $4,000 Net Interest Income $458 $427 $450 - $500 Compensation Ratio 59.9% 59.9% 58.5% - 60.5% 1 Oper
Slide 18: Q&A
Q&A Quarterly Earnings Report
Slide 19: Disclaimer
Disclaimer Forward-Looking Statements This presentation may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that involve significant risks, assumptions, and uncertainties, including statements relating to the market opportunity and futu