Live Oak Bancshares, Inc. · NYSE:LOB
Live Oak Bancshares — Q1 2020 Earnings Presentation
22 slides from Live Oak Bancshares's earnings presentation, Apr 23, 2020
Slide 1: First Quarter 2020
First Quarter 2020 April 23, 2020 © 2020 Live Oak Bancshares Inc. All Rights Reserved
Slide 2: Forward Looking Statements
L I V E O A K B A N C S H A R E S | F O R WA R D L O O K I N G S TAT E M E N T S Information in this presentation may contain “forward-looking statements” within the Private Securities Litigation Reform Act of 1995. These statements generally relate to our financial condition, results of operations,
Slide 3: Historic Times, Historic Efforts
HISTORIC TIMES, HISTORIC EFFORTS v v v Keeping Our Customers Close Paycheck Protection Employee & Community Program Outreach Outreach to 100% of Portfolio Processed about 5,000 PPP Healthcare, support & Employee loan applications Resource Fund for 600 employees Resources for cash flow management, re
Slide 4: Credit Metrics
CREDIT METRICS Ratios1 12/31/2019 3/31/2020 Past Due > 30 Days2 0.44% 0.53% Watchlist Loans and Leases3 6.18% 6.35% Classified Assets4 1.82% 1.85% Non-Accruals5 0.84% 1.05% Net Charge Off (Annualized) 0.10% 0.53% ($ in millions) Tier 1 Capital (a) $494.9 Total allowance for credit losses on loans an
Slide 5: Performance
PERFORMANCE 5
Slide 6: Capital & Liquidity
C A P I TA L & L I Q U I D I T Y As of March 31, 2020 $1.0 $1.7 $5.3 billion billion billion Cash & Investments Government Total Assets Includes $58.4 million of cash Guaranteed Loans at the holding company 14.8% 21.2% 50.9% Total Capital Ratio Liquidity Ratio1 Cash, Investments, Government Guarante
Slide 7: Q1 2020 Highlights
Performance Q1 2020 HIGHLIGHTS 38% Increase versus Q1 2019 30% Increase versus Q1 2019 15% Increase versus Q1 2019 Total Loans and Leases HFS and HFI Total Assets Managed Portfolio (1) $3.81 billion $5.28 billion $6.80 billion 4% Q1 2020 versus Q4 2019 11% Q1 2020 versus Q4 2019 26% (2) Held portion
Slide 8: Franchise Fundamentals
Performance F R A N C H I S E F U N D A M E N TA L S 38.3% Total Loan & Lease Portfolio Q1 2020 vs. Q1 2019 1.8x Guaranteed Loans Eligible for Sale Q1 2020 vs. Q1 2019 31.2% Net Interest Income Q1 2020 vs. Q1 2019 8
Slide 9: Core Earnings Heading into Uncertainty
Performance C O R E E A R N I N G S H E A D I N G I N T O U N C E RTA I N T Y Q4 2019 Q1 2020 ($ in thousands) Income (loss) before taxes1 $ 8,917 $ (15,380) Add: 1 Provision for loan and lease credit losses 4,809 11,792 Fair value adjustments Loan servicing asset revaluation1 4,135 4,692 2 Exchange
Slide 10: Credit Quality Heading into Uncertainty
Performance C R E D I T Q U A L I T Y H E A D I N G I N T O U N C E RTA I N T Y $11.8 million 58 bps 1.81% versus Q4 2019 of 13 bps versus Q4 2019 of $4.8 million versus Q4 2019 of 1.57% Provision for loan and lease credit losses Net Charge Offs to Allowance for credit losses on loans and Average Lo
Slide 11: Total Portfolio Diversification
Performance T O TA L P O R T F O L I O D I V E R S I F I C AT I O N 1 As of March 31, 2020 $3.83 billion Portfolio Balance Growth through Diversification 44.6% Guaranteed Portfolio Percentage2 $1.71 billion $3.02 billion SBA Guaranteed & Unguaranteed3 SBA 504 - $148M4 | USDA - $169M5 | OTHER - $482M
Slide 12: Allowance for Credit Loss Reclassification
Performance A L L O WA N C E F O R C R E D I T L O S S R E C L A S S I F I C AT I O N 1. Excluding allowance for credit losses on loans and leases 2. Income statement impacts reflected in the provision for loan and lease credit losses 3. Income statement impacts reflected in the net (loss) gain on l
Slide 13: Highly Efficient Deposit Platform
Performance H I G H LY E F F I C I E N T D E P O S I T P L AT F O R M $3.33 billion Retail Deposits1 95.6% Savings Retention2 Q1 2020 71.4% CD Retention3 Q1 2020 $572.4 million CD Maturities Q1 2020 1. As of March 31, 2020 2. Savings balance retention compared to accounts active at December 31, 2019
Slide 14: Strong Recurring Revenue Growth
Performance STRONG RECURRING REVENUE GROWTH 15.4% Managed Portfolio1 Q1 2020 vs. Q1 2019 31.2% Net Interest Income Q1 2020 vs. Q1 2019 22.5% Recurring Revenue Q1 2020 vs. Q1 2019 1. Outstanding balance of sold and serviced loans plus loans and leases held for investment and held for sale 14
Slide 15: Investing in Our Future
Performance INVESTING IN OUR FUTURE 15
Slide 16: Financial Technology
FINANCIAL TECHNOLOGY 16
Slide 17: Financial Technology Efforts and PPP Loans
Financial Technology TECHNOLOGY EFFORTS 600 PPP LOANS EMPLOYEES BOOKED ON THE REMOTE FINXACT CORE HUMAN TOUCH + TECHNOLOGY MODEL BANK 2020 PARITY CONVERSION CHECKING paused for PPP, but on track for 2020 deployment 17
Slide 18: Moving Forward
MOVING FORWARD 18
Slide 19: Our Focus Moving Forward
Moving Forward OUR FOCUS MOVING FORWARD SAFETY & WELL-BEING HELP OUR CUSTOMERS CONTINUE TO INVEST OF OUR EMPLOYEES NAVIGATE THE CRISIS IN OUR COMMUNITIES LOCAL & IN-VERTICAL 19
Slide 20: Appendix
APPENDIX 20
Slide 21: Banking versus FinTech Activities: Impact on Earnings
Financial Technology INVESTING IN THE FUTURE Banking versus FinTech Activities: Impact on Earnings ($ in thousands) Banking Live Oak Canapi FinTech Consolidated, Activities Apiture Ventures Advisors Activities as reported Actuals for the quarter ended March 31, 2020 Net interest income $ 40,161 $ -
Slide 22: © 2020 Live Oak Bancshares Inc. All Rights Reserved
© 2020 Live Oak Bancshares Inc. All Rights Reserved