S&t Bancorp, Inc. · NASDAQ:STBA
S&t Bancorp — Q3 2021 Earnings Presentation
29 slides from S&t Bancorp's earnings presentation, Nov 16, 2021
Slide 1: Third Quarter 2021
Christopher J. McComish Chief Executive Officer David G. Antolik President Mark Kochvar Chief Financial Officer Third Quarter 2021
Slide 2: Forward Looking Statements and Risk Factors
Forward Looking Statements and Risk Factors This information contains or incorporates statements that we believe are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally relate to our financial condition, result
Slide 3: Corporate Profile
3 Corporate Profile The Markets We Serve • $9.4 billion in assets • $7.0 billion in loans • $7.9 billion in deposits • $1.2 billion market cap • Stock symbol: STBA • Locations in 5 attractive markets in 3 states • Markets comprise 9.1 million people and 179,000 businesses • We serve over 230,000 cus
Slide 4: Leadership
4 Leadership • S&T President since January 2019 • 31 years of experience at S&T • Deep commercial and small business expertise • Proven ability to attract and retain talent • Regional market knowledge and connections COMPLEMENTARY LEADERSHIP Christopher J. McComish CHIEF EXECUTIVE OFFICER David G. A
Slide 5: Our Strengths
5 Our Strengths STABLE, LOW-COST DEPOSIT BASE STRONG CAPITAL AND LIQUIDITY ATTRACTIVE LEGACY AND EXPANSION MARKETS PROVEN ABILITY TO GROW ORGANICALLY AND M&A COMMERCIAL AND SMALL BUSINESS EXPERTISE EFFICIENT OPERATOR • Stable, legacy community markets • Emphasis on larger metro areas in and near our
Slide 6: Drivers of Performance: Priorities for 2022 and Beyond
Ensure strategic clarity and effective communications Invest in organization talent and performance Undertake strategic infrastructure and platform investments Promote rigorous credit risk management Pursue high impact growth initiatives Drivers of Performance 6 ENGAGEMENT • Team members • Customers
Slide 7: Third Quarter Overview
7 Third Quarter Overview RETURNS EARNINGS *Refer to appendix for reconciliation of non-GAAP financial measures EPS $0.70 Net Income $27.6 million ROA 1.15% ROE 9.13% ROTE* 13.53% PTPP* 1.56% HIGHLIGHTS • 7% annualized loan growth, excluding PPP • Solid C&I loan (ex-ppp) and consumer growth • Dividen
Slide 8: Performance
PTPP / AVERAGE ASSETS * 2017 2018 2019 2020 YTD 3Q21 0.0% 0.4% 0.8% 1.2% 1.6% 2.0% 2.4% RETURN ON AVERAGE TANGIBLE EQUITY * 2017 2018 2019 2020 YTD 3Q21 0.0% 5.0% 10.0% 15.0% 20.0% RETURN ON AVERAGE EQUITY 2017 2018 2019 2020 YTD 3Q21 0.0% 5.0% 10.0% 15.0% RETURN ON AVERAGE ASSETS 2017 2018 2019 202
Slide 9: 3Q21 vs 2Q21: Balance Sheet
3Q21 VS 2Q21: Balance Sheet HIGHLIGHTS • Loans, excluding PPP, increased $118 million; 7% annualized growth rate • Strong pipeline • Increased line utilization Dollars in millions 9 3Q21 2Q21 Var $934 $985 ($51) $870 $840 $30 $6,789 $6,671 $118 $19 $118 ($99) $162 $218 ($56) $7,945 $8,015 ($70) 3Q21
Slide 10: Net Interest Income
Stable core net interest income; Ex-PPP NIM rate decline due to lower loan yields and elevated Fed cash NIM Change vs Prior Quarter 2Q21: 3.16 % Loan yields (0.07 %) Elevated Fed cash (0.04 %) PPP impact 0.08 % Liability costs 0.01 % 3Q21: 3.14 % Net Interest Income Dollars in millions; *Refer to ap
Slide 11: Noninterest Income
3Q21 3Q21 vs 2Q21 3Q21 vs 3Q20 Debit and Credit Card $4.6 ($0.2) $0.4 Service Charges 3.9 0.3 0.6 Wealth 3.5 0.3 0.9 Mortgage 2.2 0.4 (1.8) Other 1.7 (0.4) (0.8) Noninterest Income $15.8 $0.4 ($0.6) Growth in service charges and wealth; improved mortgage servicing valuation Noninterest Income 11Doll
Slide 12: Noninterest Expense
3Q21 3Q21 vs 2Q21 3Q21 vs 3Q20 Salaries & Benefits $25.2 $0.7 $0.7 Data Processing 4.0 0.2 (0.2) Occupancy 3.7 0.2 0.2 FF&E 2.7 0.3 0.3 Other Taxes 1.8 0.0 0.2 Professional Services 1.6 (0.1) (0.4) FDIC 1.2 0.3 (0.7) Marketing 0.9 (0.1) (0.9) Other 6.1 (0.2) (0.2) Noninterest Expense $47.2 $1.4 ($1.
Slide 13: Markets
Western PA Upstate NY Central OH Northeast OH Eastern PA 49% $3,424 27% $1,880 9% $605 9% $643 6% $418 Portfolio Loans $6,970 Upstate NY 0% $23 Northeast OH 2% $148 Central OH 2% $135 Eastern PA Western PA68% $5,433 26% $2,030 Other 2% $176 Deposits $7,945 We operate in 5 regional markets: Markets 1
Slide 14: Loan Mix
Loan Mix Our loan portfolio is well-diversified: Dollars in millions 14 Amount % of Total CRE $3,226 46% C&I 1,699 24% Consumer 1,546 22% Construction 499 7% Total $6,970 100%
Slide 15: Deposit Mix
Deposit Mix We have a solid core deposit profile: Dollars in millions 15 Amount % of Total DDA $2,652 33% MM 2,045 26% CDs 1,201 15% Savings 1,075 14% Int Bear DDA 972 12% Total $7,945 100% Amount % of Total Personal $4,316 54% Business 3,624 46% Brokered 5 0% Total $7,945 100%
Slide 16: Asset Quality
Asset Quality ACL 3Q21 VS 2Q21: Dollars in millions 16 ASSET QUALITY TRENDS Stabilizing asset quality metrics
Slide 17: Capital
Capital We have strong capital levels and are well-positioned for growth Dollars in millions; *Refer to appendix for reconciliation of non-GAAP financial measures 17 TOTAL CAPITAL
Slide 18: Financial Data: Income Statement
Financial Data (1)These are non-GAAP numbers that adjusted for a pre-tax loss of $58.7 million resulting from customer fraud related to a check kiting scheme in Q2 2020. Refer to appendix for reconciliation of non-GAAP financial measures. (2)These are non-GAAP numbers that adjust for $11.4 million o
Slide 19: Financial Data: Balance Sheet
Financial Data 19 Balance Sheet 3Q21 2020 2019 2018 2017 Dollars in thousands Securities $870,121 $773,693 $784,283 $684,872 $698,291 Interest-bearing Balances 856,106 158,903 124,491 82,740 61,965 Loans, Net 6,866,042 7,126,776 7,080,184 5,888,023 5,709,544 Other 843,785 908,525 775,691 596,586 590
Slide 20: Financial Data: Net Interest Margin
Net Interest Margin YTD 3Q21 2020 2019 2018 2017 Securities - FTE 2.24% 2.49% 2.64% 2.62% 2.48% Loans - FTE 3.86% 4.09% 4.95% 4.72% 4.32% Total Interest-earning Assets - FTE 3.41% 3.87% 4.71% 4.48% 4.09% Interest-bearing Deposits 0.22% 0.66% 1.40% 1.01% 0.62% Borrowings 1.54% 1.56% 2.76% 2.19% 1.27%
Slide 21: Financial Data: Loan Portfolio
Financial Data 21 Loan Portfolio 3Q21 2020 2019 2018 2017 Dollars in thousands Commercial Real Estate $3,225,863 $3,244,974 $3,416,518 $2,921,832 $2,685,994 Commercial and Industrial 1,698,784 1,954,453 1,720,833 1,493,416 1,433,266 Commercial Construction 499,317 474,280 375,445 257,197 384,334 Tot
Slide 22: Financial Data: Asset Quality
Financial Data 22 Asset Quality 3Q21 2020 2019 2018 2017 Dollars in thousands Total Nonperforming Loans $111,312 $146,774 $54,057 $46,073 $23,938 Nonperforming Loans/Total Loans 1.60% 2.03% 0.76% 0.77% 0.42% Nonperforming Assets/Total Loans + OREO 1.78% 2.06% 0.81% 0.83% 0.42% YTD Net Charge-offs /A
Slide 23: Financial Data: Capital
Financial Data 23 Capital 3Q21 2020 2019 2018 2017 Tier 1 Leverage 9.65% 9.43% 10.29% 10.05% 9.17% Common Tier 1 – Risk-Based Capital 12.07% 11.33% 11.43% 11.38% 10.71% Tier 1 – Risk-Based Capital 12.48% 11.74% 11.84% 11.72% 11.06% Total – Risk-Based Capital 14.06% 13.44% 13.22% 13.21% 12.55% Tangib
Slide 24: Non-GAAP Reconciliation: 3Q21 Returns and Capital
3Q21 Return on Average Tangible Shareholders' Equity (non-GAAP) Net income (annualized) $109,492 Plus: amortization of intangibles (annualized), net of tax 1,369 Net income before amortization of intangibles (annualized) $110,861 Average total shareholders' equity $1,198,641 Less: average goodwill a
Slide 25: Efficiency Ratio and Net Interest Margin Reconciliation
3Q21 2Q21 1Q21 4Q20 3Q20 Efficiency Ratio (non-GAAP) Noninterest expense $47,241 $45,829 $45,580 $48,528 $48,246 Net interest income per consolidated statements of net income $68,712 $68,304 $70,659 $69,929 $69,276 Plus: taxable equivalent adjustment 557 585 664 725 780 Net interest income (FTE) (no
Slide 26: Adjusted Net Income and Return Reconciliation
2020 2019 2017 Excludes Fraud Excludes Merger Exp Excludes DTA Net Income excluding nonrecurring items Net income $21,040 $98,234 $72,968 Nonrecurring items 58,671 11,350 13,433 Tax effect of nonrecurring items (12,321) (2,106) — Adjusted net income (non-GAAP) $67,390 $107,478 $86,401 Diluted Earnin
Slide 27: Return on Average Tangible Equity Reconciliation
3Q21 2020 2020 2019 2019 2018 2017 2017 YTD Excludes Fraud Excludes Merger Exp Excludes DTA Return on Average Tangible Equity (non-GAAP) Net income (annualized) $117,477 $21,040 $21,040 $98,234 $98,234 $105,334 $72,968 $72,968 Nonrecurring items — — 58,671 — 11,350 — — 13,433 Tax effect of nonrecurr
Slide 28: PTPP and Tangible Common Equity Reconciliation
3Q21 2020 2020 2019 2019 2018 2017 YTD Excludes Fraud Excludes Merger Exp PTPP / Average Assets (Non-GAAP) Income before taxes $108,444 $21,040 $117,360 $117,360 $123,179 $119,405 Plus: merger related expenses — — — 11,350 — — Plus: provision for credit losses 9,087 131,424 14,873 14,873 14,995 13,8
Slide 29: Third Quarter 2021
Christopher J. McComish Chief Executive Officer David G. Antolik President Mark Kochvar Chief Financial Officer Third Quarter 2021