Beacon Financial Corporation · NYSE:BBT

Beacon Financial — Berkshire Hills Bancorp — Q3 2024 Earnings Presentation

19 slides from Beacon Financial's earnings presentation, Oct 24, 2024

  1. Slide 1: Berkshire Hills Bancorp 3Q 2024 Earnings Presentation

    Berkshire Hills Bancorp NYSE:BHLB 3Q 2024 Earnings Presentation https://ir.berkshirebank.com OCTOBER 24, 2024

  2. Slide 2: Forward-Looking Statements

    Forward-Looking Statements This document contains “forward-looking statements” within the meaning of section 27A of the Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding our outlook for earnings, net interest margin

  3. Slide 3: 3Q 2024 – Highlights of the Quarter

    3Q 2024 – Highlights of the Quarter Robust improvement in operating earnings1 • Operating EPS of $0.58 (+5% QoQ and +16% YoY) Financial • Operating Net Income of $24.8M (+7% QoQ and +15% YoY) Performance • Non-Interest Expenses of $72.3M (+1% QoQ and -2% YoY) • ROTCE of 9.91% (+26 bps QoQ and +64 bp

  4. Slide 4: 3Q 2024 Overview

    3Q 2024 Overview GAAP NET INCOME OF $37.5M, or $0.88 PER COMMON SHARE • Operating Earnings: $24.8M, or $0.58 per common share (+$1.6M or +$0.03 QoQ; +$3.3M or +$0.08 YoY) • Net Interest Margin, FTE: 3.16% (-4 bps QoQ; -2 bps YoY) • Net Interest Income, non FTE1: $88.1M (-$0.5M or -1% QoQ; -$2.3M or

  5. Slide 5: Loans: Average Balances

    ($M) Loans: Average Balances CRE C&I Resi Consumer +76 (+1%) 9,157 68 18 9,233 430 -4 -6 424 2,694 2,712 1,384 1,380 QoQ 4,649 4,717 2Q24 CRE C&I Resi Consumer 3Q24 +281 (+3%) 332 94 9,233 8,952 -56 -89 424 513 2,712 2,618 1,380 1,436 YoY 4,385 4,717 3Q23 CRE C&I Resi Consumer 3Q24 Notes: Balances i

  6. Slide 6: Deposits: Average Balances

    ($M) Deposits: Average Balances Non-Interest Bearing Money Market Time NOW Savings +64 (+1%) 9,296 6 26 54 9,360 -20 -2 2,376 2,430 1,004 1,002 QoQ 2,909 2,935 763 743 2,244 2,250 2Q24 Non-Interest NOW Money Market Savings Time 3Q24 Bearing -270 (-3%) 9,630 238 9,360 -303 -115 -80 -10 2,440 2,430 1,

  7. Slide 7: Net Interest Income

    ($000S) Net Interest Income -473 (-1%) 3,399 88,532 88,059 -1,338 -2,294 -240 QoQ 2Q24 Loans Deposits Borrowings Investments 3Q24 -2,275 (-3%) 10,034 90,334 2,845 88,059 -14,367 -787 YoY 3Q23 Loans Deposits Borrowings Investments 3Q24 7 Note: NII on an FTE basis was $90.1M (-$0.5M or -1% QoQ; -$2.2M

  8. Slide 8: Operating Non-Interest Income

    ($000S) Operating Non-Interest Income +1,374 (+7%) 558 73 21,507 850 72 20,133 95 -274 QoQ 2Q24 Deposit Loan Related Gain on Wealth FV Adj. on Other 3Q24 Related Fees Fees SBA Loans Management Securities Fees +4,042 (+23%) 2,184 21,507 983 472 204 17,465 335 -136 YoY 3Q23 Deposit Loan Related Gain o

  9. Slide 9: Operating Non-Interest Expense

    ($000S) Operating Non-Interest Expense +942 (+1%) 537 1,966 72,257 71,315 -691 -222 -648 QoQ 2Q24 Compensation Occupancy and Technology Professional Other 3Q24 and Benefits Equipment Services -1,649 (-2%) 73,906 508 202 72,257 -1,443 -602 -314 YoY 3Q23 Compensation Occupancy and Technology Professio

  10. Slide 10: Asset Quality

    ($M) Asset Quality NON-PERFORMING LOANS NET CHARGE OFFS 0.40% 0.26% 0.30% 0.24% 0.24% 0.26% 0.20% 0.24% 0.24% 0.23% 0.18% 26.6 21.4 21.5 21.3 24.0 5.4 0.07% 5.6 4.4 4.0 1.7 3Q23 4Q23 1Q24 2Q24 3Q24 3Q23 4Q23 1Q24 2Q24 3Q24 NPLs NPLs/Total Loans 10 Year Avg. NCOs Annualized NCO/Avg. Loans 10 Year Avg

  11. Slide 11: CRE Is Well-Diversified by Property Type and Geography

    C R E i s W e l l - D i v e r s i f i e d b y P r o p e r t y Ty p e a n d G e o g r a p h y Portfolio by Geography Portfolio Metrics ➢ CRE Portfolio is diversified across our markets, 10% with no exposure to NYC 7% Massachusetts New York ➢ CRE portfolio is composed of diverse property 3% 39% Connec

  12. Slide 12: Office Portfolio

    Office Portfolio Office Portfolio & Asset Quality Office Portfolio Metrics Rural, ➢ As of 3Q24, Office CRE portfolio totals $502M or 5.5% 6% of Total Loans ~94% of portfolio is within footprint and 65% is ➢ Solid portfolio performance with NPLs of ~0.7% and CBD, Suburban no NCOs 29% Suburban, ➢ No e

  13. Slide 13: Multifamily Portfolio

    Multifamily Portfolio Multifamily Portfolio Multifamily Portfolio Metrics ➢ Multifamily Portfolio is diversified across our markets, with no exposure to NYC properties ➢ As of 3Q24, Multifamily portfolio totals ~$664M or ~7.2% of Total Loans ➢ NPLs and NCOs are primarily isolated to one small credit

  14. Slide 14: Appendix

    Appendix 14 »<BerkshireHillsBancorp

  15. Slide 15: Run-Off Portfolios

    Run-Off Portfolios EOP ($M) % 3Q24 3Q24 3Q24 2Q24 1Q24 3Q24 2Q24 1Q24 Portfolios 3Q24 Total 2Q24 1Q24 4Q23 3Q23 Yield NCOs NCOs NCOs NPLs NPLs NPLs Loans (%) ($M) ($M) ($M) ($M) ($M) ($M) Upstart1 10 0.1% 67 78 90 103 ~10% 3.8 1.3 2.8 0.01 0.05 0.06 Firestone 48 0.5% 57 66 77 87 ~7% -0.01 0.1 0.8 1.

  16. Slide 16: Historical Net Charge-Offs

    (%) Historical Net Charge -Offs Annualized NCO / Avg. Loans 3.0 2.5 2.0 1.5 1.0 0.81 0.57 0.5 0.37 0.0 ’00 ’01 ’02 ’03 ’04 ’05 ’06 ’07 ’08 ’09 ’10 ’11 ’12 ’13 ’14 ’15 ’16 ’17 ’18 ’19 ’20 ’21 ’22 ’23 All FDIC Banks All FDIC Banks Avg. FDIC Banks w/ Assets $1Bn - $10Bn FDIC Banks w/ Assets $1Bn - $10B

  17. Slide 17: Solid Liquidity to Cover All Uninsured Deposits

    Solid Liquidity to Cover All Uninsured Deposits Estimated Uninsured Deposits and Available Liquidity ($M) Available Liquidity 4,446 4,326 ($M) 6/30/243 9/30/243 Uninsured Deposits¹ 3,645 3,433 1,324 1,464 Less: Collateralized Deposits² 183 186 Uninsured Deposits (after exclusions) 3,463 3,247 Total

  18. Slide 18: Non-GAAP Reconciliation (By Quarter)

    Non-GAAP Reconciliation (By Quarter) At or for the Quarters Ended Sept. 30, June 30, March 31, Dec. 31, Sept. 30, (in thousands) 2024 2024 2024 2023 2023 Total non-interest income $ 37,555 $ 20,133 $ (32,599) $ (8,383) $ 17,465 Adj: Net (gains) on sale of business operations and assets (16,048) Adj:

  19. Slide 19: Non-GAAP Reconciliation (By Quarter Continued and Notes)

    Non-GAAP Reconciliation (By Quarter Continued and Notes) At or for the Quarters Ended Sept. 30, June 30, March 31, Dec. 31, Sept. 30, 2024 2024 2024 2023 2023 (in millions, except per share data) Total average assets (F) $ 11,695 $ 11,692 $ 11,755 $ 11,862 $ 11,860 Total average shareholders' equity

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