Trico Bancshares · NASDAQ:TCBK
Trico Bancshares — Investor Presentation (October 2021)
32 slides from Trico Bancshares's investor presentation, October 2021
Slide 1: Investor Presentation Third Quarter 2021
INVESTOR PRESENTATION Third Quarter 2021 Richard P. Smith – President & Chief Executive Officer John S. Fleshood – EVP & Chief Operating Officer Peter G. Wiese – EVP & Chief Financial Officer October 2021 Investor Presentation
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: Agenda
AGENDA • Most Recent Quarter Recap • Company Overview • Lending Overview • Deposit Overview • Financials 3 October 2021 Investor Presentation
Slide 4: Most Recent Quarter Highlights
MOST RECENT QUARTER HIGHLIGHTS Consistent Profitability • Pre-tax pre-provision ROAA and ROAE were 1.78% and 15.08%, respectively, for the quarter ended September 30, 2021, and 1.72% and 14.11%, respectively, for the same quarter in the prior year. • Management remains focused on disciplined expense
Slide 5: Company Overview
COMPANY OVERVIEW 5 October 2021 Investor Presentation
Slide 6: Company Overview
COMPANY OVERVIEW Nasdaq: TCBK Headquarters: Chico, California Stock Price*: $43.40 Market Cap.: $1.3 Billion Asset Size: $8.5 Billion Loans: $4.9 Billion Deposits: $7.2 Billion Bank Branches: 70 ATMs: 88 Bank ATMs, with access to over 37,000 network ATMs Market Area: TriCo currently serves 31 counti
Slide 7: Executive Team
EXECUTIVE TEAM Rick Smith John Fleshood Peter Wiese President & CEO EVP Chief Operating Officer EVP Chief Financial Officer TriCo since 1993 TriCo since 2016 TriCo since 2018 Greg Gehlmann Craig Carney Dan Bailey Judi Giem SVP General Counsel EVP Chief Credit Officer EVP Chief Banking Officer SVP Ch
Slide 8: Positive Earnings Track Record
POSITIVE EARNINGS TRACK RECORD $36 $1.20 $32 $28 Earnings (in Millions) $24 $0.80 Qtrly EPS (diluted) $20 $16 $12 $0.40 $8 $4 $0 Q4'17 * Q1'18 Q2'18 Q3'18 Q4'18 Q1'19 Q2'19 Q3'19 Q4'19 Q1'20 Q2'20 Q3'20 Q4'20 Q1'21 Q2'21 Q3'21 $0.00 Net Income ($MM) $3.0 $13.9 $15.0 $16.2 $23.2 $22.7 $23.1 $23.4 $22
Slide 9: Shareholder Returns
SHAREHOLDER RETURNS Dividends per Share: 11.5% CAGR* Return on Avg. Shareholder Equity 12.42% Q1 Q2 Q3 Q4 $0.88 10.75% 10.49% $0.82 10.04% 9.47% $0.66 $0.70 $0.22 $0.22 8.10% $0.60 7.18% $0.52 $0.19 $0.25 $0.17 $0.22 $0.15 $0.22 $0.15 $0.17 $0.17 $0.15 $0.25 $0.13 $0.22 $0.17 $0.19 $0.15 $0.17 $0.13
Slide 10: Consistent Growth
CONSISTENT GROWTH Organic Growth and Disciplined Acquisitions Core Acquired PPP Loans CAGR 5 yrs. 10 yrs. July 2018 $8,458 Acquired FNB Bancorp $8,170 ($1.2B assets) $8,032 Total Assets 13.6% 13.0% $7,640 Excluding PPP 13.2% 12.8% March 2016 Acquired 3 Branches $6,471 January 2014 from BofA $6,352 A
Slide 11: Top of Mind
“TOP OF MIND” Executive Management Themes and Topics • Building a Successful Partnership With Our Future Team Members at Valley Republic Bank and Working to Ensure an Efficient Integration of Culture and Operations • Driving Loan and Non-Interest Income Growth / Diversification Through Organic and A
Slide 12: Loans and Credit Quality
LOANS AND CREDIT QUALITY 12 October 2021 Investor Presentation
Slide 13: Consistent Loan Growth
CONSISTENT LOAN GROWTH $5,000 6.50% $361 $240 $151 $423 $426 $327 $4,711 $4,739 $4,500 $4,610 $4,386 $4,407 $4,443 $4,381 $4,305 $4,000 $4,182 $4,104 $4,022 $4,038 $3,500 5.48% 5.50% 5.50% 5.24% 5.46% $3,000 $3,015 5.33% 5.09% 5.15% 5.23% 5.16% 4.92% $2,500 5.05% 4.86% $2,000 4.78% 4.50% $1,500 $1,0
Slide 14: Gross Production vs Payoff
GROSS PRODUCTION VS PAYOFF In addition to the $0.9 billion in non-PPP loan TCBK originated over $1.3 billion in the trailing twelve originations during this period, TCBK originated over months, compared to nearly $0.9 billion in the twelve $0.4 billion in PPP loans. months prior, while facing headwi
Slide 15: Diversified Loan Portfolio
DIVERSIFIED LOAN PORTFOLIO CRE Non-Owner $1,526 Occupied $1,600 CRE-Owner $701 CRE Non Ow n Loans, net % of CRE # Loans Occupied $581 By Collateral ($MM) NOO Retail $426 335 28% $830 Office $374 366 24% Multifamily Hotel/Motel $222 79 15% $602 Warehouse $121 158 8% Light Industrial $89 101 6% $665 S
Slide 16: CRE Collateral Values
CRE COLLATERAL VALUES DISTRIBUTION BY LTV 90% LTV Range 80% 78% <= 60% > 60% - 75% 70% > 75% 71% 60% 62% 61% 60% 58% 56% 50% 46% 46% 40% 39% 40% 38% 38% 37% 30% 25% 20% 21% 10% 8% 1% 5% 2% 2% 0% 4% 2% 0% Hotel/Motel Office Building Retail Building Warehouse Light Industrial Other Multifamily CRE Own
Slide 17: Unfunded Loan Commitments
UNFUNDED LOAN COMMITMENTS HELOCs – by vintage, with weighted avg. coupon Outstanding Principal ($MM) 6.00% $150 Unfunded Commitment ($MM) 5.24% 5.45% 5.00% 4.64% 4.49% 4.77% $125 4.53% 4.53% 4.48% 4.28% 4.34% 4.44% 4.19% $104 3.72% 3.63% $100 $164 4.00% 3.33% 3.00% $75 2.00% $50 1.00% $25 0.00% $0 >
Slide 18: C&I Utilization
C&I UTILIZATION $600 60% 54.5% $500 53.3% 52.4% 52.7% 50% 49.3% 44.0% $400 42.9% 40% Millions of $ 36.4% 34.5% 34.5% $300 32.7% 30% $235 $219 $207 $221 $254 $262 $249 $248 $243 $247 $265 $273 $360 $372 $200 $384 $353 20% $208 $205 $206 $197 $187 $186 $100 10% $0 0% 1Q-2019 2Q-2019 3Q-2019 4Q-2019 1Q
Slide 19: Loan Yield Composition
LOAN YIELD COMPOSITION • Variable rate loans at their floor as a percentage of total variable loans has remained stable at 88% in Q3-2021. • The most prominent index for the variable portfolio is 5 Year Treasury CMT Fixed vs. Variable, Total Loans (ex-PPP) Variable Variable At Above Floor Floor 57%
Slide 20: Loan Yield Composition
LOAN YIELD COMPOSITION Loans at Floor by Year of Next Reprice Balance WA Rate No Floor WA Rate At Floor 4.92% 4.79% 4.58% 4.47% 4.31% 4.26% 3.95% 4.00% 3.97% 3.77% 3.76% 3.68% 3.65% 3.63% $442 $285 $238 $257 $439 $530 $523 Monthly < 1 Year 1 - 2 Years 2 - 3 Years 3 - 4 Years 4 - 5 Years > 5 Years
Slide 21: Loan Yield Composition
LOAN YIELD COMPOSITION Loans at Floor by Year of Next Reprice – Commercial Real Estate & Multifamily Balance WA Rate No Floor WA Rate At Floor 4.91% 4.78% 4.60% 4.44% 4.25% 4.26% 4.09% 4.10% 4.00% 3.82% 3.79% 3.79% 3.68% 3.65% $78 $224 $210 $221 $357 $455 $389 Monthly < 1 Year 1 - 2 Years 2 - 3 Year
Slide 22: Allowance for Credit Losses
ALLOWANCE FOR CREDIT LOSSES Drivers of Change under CECL Gross charge offs Change in reserve Includes volume Lagging recovery 1.74% 1.72% $1.582 million for all collectively and mix change of California of Total and individually due to originations, Unemployment of Total Gross recoveries a
Slide 23: Allowance for Credit Losses
ALLOWANCE FOR CREDIT LOSSES Allocation of Allowance by Segment 23 October 2021 Investor Presentation
Slide 24: Risk Grade Migration
RISK GRADE MIGRATION 0.9% 1.0% 1.0% 1.2% 1.2% 1.0% 1.3% 3.0% 3.3% 2.9% 2.6% 2.8% 14.0% 11.2% 9.3% 13.8% 11.4% 13.6% % of Loan Portfolio Outstanding, by Risk Grade 84.6% 85.0% 86.9% 83.9% 82.2% 82.1% 2Q-2020 3Q-2020 4Q-2020 1Q-2021 2Q-2021 3Q-2021 Zero balance in Doubtful and Loss Pass Watch Specia
Slide 25: Asset Quality
ASSET QUALITY Non-Performing Assets as a % of Total Assets TCBK Peers NPAs have remained below peers while loss coverage has expanded, 0.77% 0.73% 0.75% 0.73% 0.68% 0.64% first with the adoption of CECL, then 0.54% 0.58% 0.59% 0.61% 0.54% 0.53% 0.58% through the on-going concerns of the 0.45% 0.45%
Slide 26: Deposits
DEPOSITS 26 October 2021 Investor Presentation
Slide 27: Deposits: Strength in Funding
DEPOSITS: STRENGTH IN FUNDING Liability Mix 09/30/2021 Loans to Core Deposits (%) TCBK Peers Borrowings & 120 Time Subordinated Other Deposits, Debt, 1.4% liabilities, 100 4.4% 1.8% 80 (Cost 0.52%) 81.6 81.6 80.7 80.6 79.1 78.1 76.9 76.3 75.9 75.5 60 72.7 71.8 70.2 67.7 40 20 0 Non Interest- 2018 20
Slide 28: Deposits: Strength in Cost of Funds
DEPOSITS: STRENGTH IN COST OF FUNDS 8,000 Continued growth $7,237 $6,863 $6,992 in the volume of 7,000 $6,506 noninterest- $6,248 $6,341 bearing deposits 6,000 $5,430 $5,403 $2,943 both in terms of $5,342 $5,295 $5,367 $2,767 $2,844 dollars and as a 5,000 $2,487 $2,518 $2,582 percent of total $1,7
Slide 29: Financials
FINANCIALS 29 October 2021 Investor Presentation
Slide 30: Consistent Operating Metrics
CONSISTENT OPERATING METRICS Net Interest Margin (FTE) Efficiency Ratio 4.47% 4.32% 4.30% 68.7% 4.23% 4.22% 65.1% 65.4% 3.96% 63.7% 59.7% 58.4% 3.61% 52.9% 2015 2016 2017 2018 2019 2020 2021 2015 2016 2017 2018 2019 2020 2021 PPNR as % of Average Assets ROAA 1.43% 1.48% 1.94% 1.94% 1.24% 1.79% 1.83%
Slide 31: Well Capitalized
WELL CAPITALIZED Tier 1 Capital Ratio CET1 Ratio 14.4% 14.2% 13.3% 13.8% 14.0% 13.2% 13.7% 13.7% 12.9% 13.2% 12.5% 12.2% 12.2% 11.7% 2015 2016 2017 2018 2019 2020 Q3 2021 2015 2016 2017 2018 2019 2020 Q3 2021 Total Risk Based Capital Tangible Common Equity Ratio 15.4% 10.6% 15.1% 15.1% 15.2% 14.8% 1
Slide 32: October 2021 Investor Presentation
32 October August 2021 2020 Investor Presentation
TriCo Bancshares — Investor Presentation (October 2021) on 6ix