Amalgamated Financial Corp. · NASDAQ:AMAL
Amalgamated Financial — Q1 2020 Earnings Presentation
27 slides from Amalgamated Financial's earnings presentation, Apr 30, 2020
Slide 1: First Quarter 2020 Earnings Presentation
AMALGAMATED BANK First Quarter 2020 Earnings Presentation April 30, 2020 amalgamatedbank.com Member FDIC
Slide 2: Safe Harbor Statements
Safe Harbor Statements FORWARD-LOOKING STATEMENTS This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act, Section 21E of the Securities Exchange Act of 1934, as amended. Statements regarding the potential effects of the COVID-19 pande
Slide 3: First Quarter 2020 Highlights
First Quarter 2020 Highlights GAAP net income of $0.30 per diluted share; core net income of $0.29 per diluted share (1) Net income of $0.45 per diluted share excluding COVID loan provision build(1)(2) Pre-tax, pre-provision income(3) of $21.5mm compared to $16.5mm in 4Q19 Highest quarterly
Slide 4: Key Financial Trends through 1Q20
Trends Key Financial Trends through 1Q20 ($ in millions) Loans, net 11.0% Ending Deposits 22.2% CAGR(1) CAGR(1) 5,077 3,439 3,515 4,641 3,211 4,105 2,780 3,233 2017 2018 2019 1Q20 2017 2018 2019 1Q20 Pre-tax Pre-Provision Earnings2 48.3% NPA / Total Assets CAGR(1) 86.1 68.0 2.20% 50.1 1.27% 1.25% 1.
Slide 5: Response to COVID-19
Response to COVID-19 Our response during the COVID-19 pandemic has allowed us to take care of employees and customers while maintaining operational continuity Employees and Community Rotational schedule and measures in place to ensure health and safety of employees still in branches All bank emp
Slide 6: Environmental, Social and Governance (ESG)
Environmental, Social and Governance (ESG) 1Q20 Mission Aligned Initiatives and Accomplishments Frontline Workers Fund launched with Amalgamated Foundation to provide financial support to critical workers on the frontlines of the COVID-19 pandemic Amalgamated’s MSCI ESG score improved to A from
Slide 7: Deposit Portfolio
Deposit Portfolio Total Deposits 1Q20 Highlights ($ in millions) Total ending deposits increased $435.6 $5,077 million, or 37.5% annualized, compared to 4Q19 $4,825 Total average deposits increased $400.3 $4,641 million, or 36.2% annualized, compared to $4,425 4Q19 $4,322 $4,224 $276.5 million
Slide 8: Political Deposits
Political Deposits Political Deposits Historical Trend ($ in millions) $821.5 $774.8 $578.6 $510.9 $416.4 $419.4 $397.8 $321.4 $271.0 $241.8 $181.9 $156.5 $124.1 $84.8 1Q17 2Q17 3Q17 4Q17 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 24-Apr 8
Slide 9: Liquidity Sources
Liquidity Sources Liquidity sources amount to $2.9B as of March 31, 2020 Capacity to borrow from Federal Home Loan Bank (FHLB) presents largest source of balance sheet funding Ability to borrow based on existing balance sheet assets as collateral, primarily mortgage (commercial and multi-family)
Slide 10: Interest Earning Assets
Interest Earning Assets Interest Earning Assets of $5.5B as of March 31, 2020 We maintain a diverse, low risk profile of interest earning assets • No fossil fuel exposure • $147mm of government guaranteed loans • $789mm, agency • $124mm residential solar loans securities with strong credit profile
Slide 11: Loan and Held-to-Maturity Securities
Loan and Held-to-Maturity Securities Total Loans, Net1 1Q20 Highlights ($ in millions) 3,700 6.00% Total Loans, net Yield $3,467 $3,515 Total loans increased $76.2 million, or 3,500 $3,439 5.50% 8.9% annualized, compared to 4Q19 $3,267 $3,291 3,300 5.00% 4.44% 1Q20 Yield at 4.13%; increase of 3
Slide 12: Property Assessed Clean Energy (PACE)
Property Assessed Clean Energy (PACE) Investment in PACE Funding Group (PFG) Strategic investment of $2.5 million with PFG where the Bank provided investment capital, and commitment to purchase PACE financing products Will provide values-aligned financing for customers of PACE assessments Working
Slide 13: Allowance for Loan Losses
Allowance for Loan Losses Allowance for Loan Losses Change from 1Q20 Overview 4Q19 to 1Q20 ($ in millions) Allowance for loan losses totals $42.3 million in 1Q20 Qualitative increases in 1Q20 are related to economic factors We expect increases in qualitative factors for 2Q20 due to COVID-19 lo
Slide 14: COVID-19 Deferrals – Post Quarter Update
COVID-19 Deferrals – Post Quarter Update Current rate of payment deferrals is approximately 9% of loan balances, with an additional 3% likely to proceed to approval Data as of week ending 4/25/2020 Payment deferrals Documents 3/31/20 approved or in % of requests; not % of Loan Type Balance process p
Slide 15: Residential Lending – Post Quarter Update
Residential Lending – Post Quarter Update Residential Payment Deferrals - as of April 24, 2020 Total deferrals are $114 million, or 8% of residential loans • Deferrals are higher in NY/NJ/CT markets vs. other geographies • Volumes increased rapidly after program was announced, but the pace of reques
Slide 16: Commercial Lending – Post Quarter Update
Commercial Lending – Post Quarter Update Commercial Payment Deferrals - as of April 24, 2020 Total deferrals approved or in process of $185 million with approximately $108 million in additional requests • Majority of requests are in the multifamily, hotel or restaurant space for C&I • We expect defe
Slide 17: Cash and Investment Securities
Cash and Investment Securities Securities – Book value(1) 1Q20 Highlights ($ in millions) $1,745 Investment Securities totaled $1.7 billion $956.0 book value for 1Q20 1,650 3.90% $1,510 Securities increase of $235 million from 1,450 $922.0 4Q19 is primarily due to an increase in 3.70% $1,299 $1,
Slide 18: Net Interest Income and Margin
Net Interest Income and Margin Net Interest Income & Margin 1Q20 Highlights ($ in millions) 50.0 Net interest income is $44.7 million, 6.00% compared to $42.3 million in 4Q19 Net Interest Income Net Interest Margin 5.50% $44.7 1Q20 vs. 4Q19 changes due to: 45.0 5.00% $41.9 $41.8 $42.3 Increases:
Slide 19: Non-Interest Expense and Efficiency
Non-Interest Expense and Efficiency 50 100.0% Non-Interest Expense 1Q20 Highlights 45($ in millions) Efficiency ratio of 60.0% for 1Q20 Core efficiency ratio of 59.4% for 1Q20(1) 90.0% 40 Non-interest expense for the 4Q19 is $32.3 35 $33.5 $31.3$31.4 $31.8$31.9 $32.4 $32.3 80.0% million $30.8$
Slide 20: Capital
Capital Tier 1 Leverage Ratio 1Q20 Highlights Regulatory capital ratios remain well 9.04% 9.03% 8.90% 8.90% capitalized 8.47% Tier 1 leverage ratio of 8.47% as of 1Q20 Common Equity Tier 1 Capital of 12.74% 1Q19 2Q19 3Q19 4Q19 1Q20 Decrease in Tier 1 leverage ratio due Common Equity Tier 1 R
Slide 21: Credit Quality Portfolio
Credit Quality Portfolio NPA / Total Assets 1Q20 Highlights 1.50% 1.42% Nonperforming assets are $65.6 million 1.25% as of 1Q20, compared to $66.7 million in 1.15% 1.14% 4Q19 $7.4 million decrease in accruing restructured loans $3.4 million increase in past-due accruing loans 1Q19 2Q19 3Q19 4Q
Slide 22: Returns
Returns ROAE & Core ROATCE (1) 20.0% 18.0% 16.0% 14.0% 12.0% 11.4% 10.5% 10.9% 10.7% 9.8% 10.2% 9.7% 9.7% 10.0% 8.0% 7.6% 7.7% 6.0% 4.0% 2.0% 0.0% 1Q19 2Q19 3Q19 4Q19 1Q20 ROAE CORE ROATCE (1) See non-GAAP disclosures on pages 25-26 22
Slide 23: FY 2020 Outlook
FY 2020 Outlook Previous Guidance on 1/31/2020 Core pre-tax pre-provision(1) earnings of $70 to $78 million Assumed: Year-end 2019 yield curve with no change in Fed rate targets 10% balance sheet growth Core efficiency ratio of 64% or lower Core expense run rate of approximately $32 mill
Slide 24: Appendix
Appendix amalgamatedbank.com Member FDIC
Slide 25: Reconciliation of Non-GAAP Financials
Reconciliation of Non-GAAP Financials 25
Slide 26: Reconciliation of Non-GAAP Financials
Reconciliation of Non-GAAP Financials 26
Slide 27: Thank You
Thank You amalgamatedbank.com
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