Bank Of N.t. Butterfield & Son Limited (the) Voting · NYSE:NTB
Bank Of N.t. Butterfield & Son Limited (the) Voting — The Bank of N.T. Butterfield & Son — Q1 2021 Earnings Presentation
26 slides from Bank Of N.t. Butterfield & Son Limited (the) Voting's earnings presentation, Apr 29, 2021
Slide 1: First Quarter 2021 Earnings Presentation
First Quarter 2021 Earnings Presentation The Bank of N.T. Butterfield & Son Limited April 29, 2021
Slide 2: Forward-Looking Statements
Forward-Looking Statements Forward-Looking Statements: Certain of the statements made in this release are forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements with respect to our beliefs, plans, obje
Slide 3: Agenda and Overview
Agenda and Overview Presenters Agenda Butterfield Overview Michael Collins • Overview • Leading Bank in Attractive Markets Chairman and Chief Executive Officer • First Quarter 2021 Financials • Strong Capital Generation and Return Michael Schrum • Q&A • Resilient, Diversified Fee Revenue Model Group
Slide 4: First Quarter 2021 Highlights
First Quarter 2021 Highlights • Net income of $41.6 million, or $0.83 per share (In US$ millions) vs. Q4 2020 vs. Q1 2020 • Return on average common equity of 17.5%; return on average tangible common equity** of 19.3% Q1 2021 $ % $ % • First quarter credit provision release of $1.5 million due to im
Slide 5: Financials
@ BurterFiecd
Slide 6: Income Statement: Net Interest Income
Income Statement Net Interest Income Net Interest Margin & Yields Net Interest Income before Provision for Credit Losses - Trend (In US$ millions) (In US$ millions) Q1 2021 vs. Q4 2020 $87.6 Avg. Balance Yield Avg. Balance Yield Cash, S/T Inv. & Repos $ 4,180.1 0.06 % $ 640.7 (0.01)% Investments 5,2
Slide 7: Income Statement: Non-Interest Income
Income Statement Non-Interest Income Non-Interest Income Trend (In US$ millions) (In US$ millions) Q1 2021 vs. Q4 2020 $47.6 $47.8 $47.6 Asset management $ 7.4 $ 0.2 Banking 11.4 (2.2) Foreign exchange revenue 11.2 1.9 Trust 12.8 (0.5) Custody and other 3.8 0.4 Other 0.9 — Total Non-Interest Income
Slide 8: Income Statement: Non-Interest Expenses
Income Statement Non-Interest Expenses Core Non-Interest Expense Trend* Core Non-Interest Expenses* vs. Q4 2020 (In US$ millions) (In US$ millions) Q1 2021 $ % $87.6 $82.4 $80.9 Salaries & Benefits** $ 39.0 $ (1.8) (4.3)% Technology & Comm. 16.1 (0.1) (0.5)% Property 7.4 — 0.7 % 63.8% 65.6% 64.8% Pr
Slide 9: Capital Requirements and Return
Capital Requirements and Return Regulatory Capital (Basel III) - Total Capital Ratio*** Leverage Capital 9.7% 1.5% 20.0% 7.0% 1.3% 8.3% 14.3% 5.7% 13.5% Butterfield - Current US Peer Median* Butterfield Current BMA 2020 Minimum US Peer Median* TCE/TA TCE/TA Ex Cash Dividend Payout Ratio** • Strong c
Slide 10: Balance Sheet
Balance Sheet Total Assets (In US$ millions) Q1 2021 Q4 2020 (In US$ billions) Cash & Equivalents $ 2,582 $ 3,290 $14.7 $14.8 $13.2 Reverse Repos & S/T Investments 1,236 1,020 Investments 5,426 4,863 Loans (net) 5,149 5,161 Other Assets 412 405 Total Assets $ 14,805 $ 14,739 $5.4 $4.5 $4.9 $5.0 $5.2
Slide 11: Asset Quality
Asset Quality Non-Accrual Loans Investment Portfolio (In US$ millions) $72.5 Loan Distribution Rating Distribution $70.2 Consumer Unrated 0.1% 4.2% AA 0.2% $53.1 A 0.4% Res Mtg 65.9% Comm’l R/E 15.1% Other Comm’l 9.4% AAA 99.2% Government 5.3% $5.1 billion $5.4 billion Q1 2020 Q2 2020 Q3 2020 Q4 202
Slide 12: Interest Rate Sensitivity
Interest Rate Sensitivity Average Balance - Balance Sheet Interest Rate Sensitivity Average Balances 14.4% 15.5% (US$Mil) Weighted 12.8% Average Life Q1 2021 vs. Q4 2020 Duration vs. Q4 2020 7.0% 7.0% Cash & Reverse Repos & S/T Invest. 4,180.1 640.7 <0.03 N/A N/A AFS 2,864.6 413.3 4.8 2.2 6.1 (3.8)%
Slide 13: Appendix
@ BurterFiecd
Slide 14: Current Expected Credit Losses (CECL)
Appendix Current Expected Credit Losses (CECL) ACL / Total Loans ACL by Loan Type $36.2 $34.1 $31.6 (In US$ millions) Q1 2021 Q4 2020 Q3 2020 0.72% Loans Commercial $ 11.0 $ 11.6 $ 16.3 0.66% 0.61% Commercial Real Estate 1.6 2.1 2.3 Consumer 3.8 4.5 5.2 Residential Mortgage 15.2 15.9 17.2 Q1 2020 Q2
Slide 15: COVID-19 Update
Appendix COVID-19 Update* Market Segment Update** Mortgage Assistance Program Progression*** Q2 2020 Q3 2020 Q4 2020 Q1 2021 Bermuda Cayman Guernsey/Jersey Actual Participation Rate 75% 34% — — Active COVID-19 Cases 880 25 3 Call Program Indication Ready to Resume Payment in 4Q20 — 98% — — Total COV
Slide 16: Deposits
Appendix Customer Deposits Average Deposit Volume and Cost of Deposits Deposit Composition (In US$ millions) By Currency 4,000 8.8% 6.5% 6.3% 20.1% 21.1% 21.4% 3,500 3,000 69.8% 73.4% 72.6% 2,500 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Desposits 1.21% 2,000 USD / USD Pegged GBP Other 0.42% 0.71% 0.6
Slide 17: Residential Mortgage and Commercial Loans
Appendix Residential Mortgage Loans (US$ Billions) Commercial Loans (US$ Billion) $2.5 $2.7 $3.2 $3.4 $3.4 $1.1 $1.2 $1.7 $1.6 $1.5 32% 37% 45% 52% 47% 49% 51% 48% 49% 50% 22% 21% 9% 14% 3% 22% 18% 18% 18% 18% 19% 2% 46% 2% 5% 5% 42% 42% 34% 32% 32% 33% 32% 29% 26% 2017 2018 2019 2020 Q1 2021 2017 2
Slide 18: Balance Sheet Trends
Appendix Balance Sheet Trends (in millions of US Dollars, unless otherwise indicated) 2021 2020 2019 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Assets Cash & Equivalents $ 2,582 $ 3,290 $ 2,161 $ 2,228 $ 1,978 $ 2,550 $ 3,605 $ 2,011 $ 2,601 Reverse Repos & S/T Investments 1,236 1,020 1,133 1,136 1,240 1,361 855 33
Slide 19: Average Balance Sheet Trends
Appendix Average Balance Sheet Trends (in millions of US Dollars, unless otherwise indicated) Q1 2021 Q4 2020 Q1 2020 Average Interest Average rate Average Interest Average rate Average Interest Average rate Assets balance ($) ($) (%) balance ($) ($) (%) balance ($) ($) (%) Cash due from banks, reve
Slide 20: Income Statement Trends
Appendix Income Statement Trends (in millions of US Dollars, unless otherwise indicated) 2021 2020 2019 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Net Interest Income $ 74.9 $ 75.6 $ 75.3 $ 79.1 $ 87.6 $ 86.2 $ 86.3 $ 85.2 $ 88.0 Non-Interest Income 47.6 47.8 46.9 41.7 47.6 49.7 46.6 44.2 43.4 Prov. for Credit Reco
Slide 21: Non-Interest Income & Expense Trends
Appendix Non-Interest Income & Expense Trends (in millions of US Dollars, unless otherwise indicated) 2021 2020 2019 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Non-Interest Income Asset Management $ 7.4 $ 7.2 $ 6.8 $ 7.4 $ 7.8 $ 7.8 $ 7.4 $ 6.9 $ 6.7 Banking 11.4 13.6 13.4 9.1 11.2 14.0 12.1 12.1 11.2 FX Revenue 11
Slide 22: Core Non-Interest Expense Trends
Appendix Core Non-Interest Expense* Trends (in millions of US Dollars, unless otherwise indicated) 2021 2020 2019 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Salaries & Benefits** $ 39.0 $ 40.6 $ 42.2 $ 41.4 $ 44.1 $ 46.6 $ 42.8 $ 41.1 $ 42.8 Technology & Comm. 16.1 16.1 16.3 16.3 16.4 16.5 16.3 15.2 14.6 Profession
Slide 23: Non-GAAP Reconciliation
Appendix Non-GAAP Reconciliation (in millions of US Dollars, unless otherwise indicated) 2021 2020 Q1 Q4 Q3 Q2 Q1 Net income A $ 41.6 $ 42.1 $ 30.5 $ 34.3 $ 40.3 Non-core (gains), losses and expenses Non-core (gains) losses Distribution from equity method investment — — (0.7) — — Total non-core (gai
Slide 24: Non-GAAP Reconciliation (cont'd)
Appendix Non-GAAP Reconciliation (cont'd) (in millions of US Dollars, unless otherwise indicated) 2021 2020 Q1 Q4 Q3 Q2 Q1 Tangible equity to tangible assets Shareholders' equity K $ 936.5 $ 981.9 $ 988.9 $ 990.3 $ 980.5 Less: goodwill and intangible assets (91.5) (92.8) (90.7) (89.7) (91.2) Tangibl
Slide 25: Commentary on Factors Influencing COVID-19 Implications
Appendix Commentary on Factors Influencing COVID-19 Implications The continuing implications of the pandemic on our business, financial condition, liquidity and results of operations will depend on factors such as, but not limited to, the following: • The duration and scope of the pandemic • The eff
Slide 26: Peer Group
Appendix Peer Group Our peer group includes the following banks, noted by their ticker symbols: • First Republic Bank (FRC) • First Hawaiian, Inc. (FHB) • SVB Financial Group (SIVB) • Bank of Hawaii Corporation (BOH) • East West Bancorp, Inc. (EWBC) • Trustmark Corporation (TRMK) • Cullen/Frost Bank
The Bank of N.T. Butterfield & Son — Q1 2021 Earnings Presentation on 6ix