Stellar Bancorp, Inc. · NYSE:STEL
Stellar Bancorp — Q4 2023 Earnings Presentation
18 slides from Stellar Bancorp's earnings presentation, Jan 26, 2024
Slide 1: Fourth Quarter 2023 Earnings Presentation
Fourth Quarter 2023 Earnings Presentation Exhibit 99.2
Slide 2: Forward-Looking Statements and Non-GAAP Financial Measures
Forward-Looking Statements and Non-GAAP Financial Measures 2 Certain statements in this press release which are not historical in nature are intended to be, and are hereby identified as, “forward-looking statements” for purposes of the safe harbor provided by Section 27A of the Securities Act of 193
Slide 3: Stellar Bancorp, Inc. - Snapshot
3 (1) Refer to the calculation of this non-GAAP financial measure and a reconciliation to its most directly comparable GAAP financial measure in the appendix. Stellar Bancorp, Inc. - Snapshot Houston’s largest regionally-focused bank Principal banking subsidiary renamed Stellar Bank upon successfu
Slide 4: Focused on Serving the Houston Region
$1.9 $1.9 $2.1 $2.5 $2.6 $3.0 $3.1 $5.5 $5.7 $6.7 $7.6 $7.8 $8.6 $10.2 $12.0 $27.2 $29.8 $157.3 Texas Independent BOK Regions Texas Capital Truist Comerica Third Coast Woodforest Prosperity Capital One Frost Cadence Stellar PNC Zions BofA Wells Fargo JPMorgan Focused on Serving the Houston Region 4
Slide 5: Full Year and Fourth Quarter 2023 Highlights
5 Full Year and Fourth Quarter 2023 Highlights (1) Refer to the calculation of these non-GAAP financial measures and a reconciliation to their most directly comparable GAAP financial measures in the appendix. (2) Annualized. Strong Net Interest Margin (“NIM”): NIM of 4.40% (2) and NIM excluding pu
Slide 6: Fourth Quarter Deposit Summary
Fourth Quarter Deposit Summary 6 Deposit Mix Deposits (in millions) Maintaining Discipline Navigating Competitive Deposit Market As of December 31, 2023: • Retained favorable mix: 40.0% noninterest-bearing deposits • Estimated uninsured deposits, net of collateralized deposits: 42.6% • Average accou
Slide 7: Fourth Quarter Loan Summary
Fourth Quarter Loan Summary 7 (1) Refer to the calculation of these non-GAAP financial measures and a reconciliation to their most directly comparable GAAP financial measures in the appendix. . Loan Portfolio Composition (1) (1) 1-4 Family 13.2% Multifamily RE 5.8% Resi. C&D 3.4% CRE C&D 13.4% CRE 2
Slide 8: Fourth Quarter Asset Quality Summary
Fourth Quarter Asset Quality Summary 8 Nonperforming Loans by Type (1) Combined represents the simple addition of legacy balances for 2022; estimated. Allowance for credit losses on loans: • As of December 31, 2023, was $91.7 million, or 1.16% of total loans, compared to $93.6 million, or 1.17% of t
Slide 9: Regulatory Capital Ratios
Regulatory Capital Ratios 9 (1) Refer to the calculation of this non-GAAP financial measure and a reconciliation to its most directly comparable GAAP financial measure in the appendix. Regulatory capital ratios have grown meaningfully in 2023 Minimum Required Plus Capital Conservation Buffer Consoli
Slide 10: Strong Liquidity Profile
10 Strong Liquidity Profile Stellar is well-positioned to manage through current environment Sources of Liquidity at December 31, 2023 Sources of Liquidity Estimated Uninsured Deposits at December 31, 2023 (1) Brokered deposit capacity is governed by internal policy limits. 95.8% 126.6% Immediate av
Slide 11: Key Takeaways
11 Key Takeaways Excellent core funding profile Strong earnings power and franchise value in one of the best markets in the U.S. Key success factors: Credit performance and risk management Significant financial flexibility Positioned for rapid capital-build to continue
Slide 12: Diverse and Strong Markets of Operation
4.8% 4.1% 2.1% Houston MSA Texas USA 5.0% 4.4% 2.4% Houston MSA Texas USA 29.8 27.2 12.0 10.2 8.6 7.8 7.6 6.7 5.7 JP Morgan Wells Fargo BofA Zions PNC Stellar Cadence Frost Capital One Prosperity Diverse and Strong Markets of Operation 12 Houston is Diverse, with Significant Economic Tailwinds Great
Slide 13: Diversified and Growing Economy
Professional and Business Services 17% Government 13% Education and Health Services 13% Leisure and Hospitality 10% Retail Trade 9% Manufacturing 7% Construction 6% Transportation, Warehousing, and Utilities 6% Financial Activities 6% Wholesale Trade 5% Other Services 4% Mining and Logging 2% Inform
Slide 14: Houston is a Resilient Market
2.0 3.0 4.0 5.0 6.0 7.0 2.0 2.5 3.0 3.5 2007 2009 2011 2013 2015 2017 2019 2021 2023 Houston is a Resilient Market 14 Since the Great Recession, Houston has proven its resiliency, weathering economic cycles and natural disasters − Houston welcomed 2.1 million new residents and created over 905 tho
Slide 15: Houston's Growth Projected to Continue
302,570 (300,000) (200,000) (100,000) 0 100,000 200,000 300,000 400,000 H o u st o n D a ll a s N ew Y o rk A tl a n ta P h o en ix M ia m i T a m p a S ea tt le R iv er si d e B o st o n D en v er W a sh in g to n S a n F ra n ci sc o M in n ea p o li s P h il a d el p h ia S a n D ie g o B a lt im
Slide 16: Housing Market and Cost of Living
$92,662 $86,611 $83,193 $81,625 $74,325 $71,347 $73,503 New York MSA Los Angeles MSA Chicago MSA Dallas MSA Houston MSA Texas U.S. $787,500 $978,000 $335,000 $385,000 $330,000 $341,700 $400,528 New York MSA Los Angeles MSA Chicago MSA Dallas MSA Houston MSA Texas U.S. 8.5x 11.3x 4.0x 4.7x 4.4x 4.8x
Slide 17: Appendix: Non-GAAP Reconciliation
Appendix: Non-GAAP Reconciliation(1) 17 (1) See the disclosure under the heading “GAAP Reconciliation of Non-GAAP Financial Measures” on slide 2 regarding the use of non-GAAP financial measures. (2) Interim periods annualized. Net income $ 27,266 $ 30,908 $ 130,497 $ 51,432 Add: Provision for credit
Slide 18: Be Stellar.
ol, Be Stellar. NYSE: STEL stellar BANCORP, INC. 18