Atlantic Union Bankshares Corporation · NYSE:AUB
Atlantic Union Bankshares — Investor Presentation (October 2023)
32 slides from Atlantic Union Bankshares's investor presentation, Oct 30, 2023
Slide 1: Investor Presentation
Investor Presentation NYSE: AUB November – December 2023
Slide 2: Forward Looking Statements
2 Forward Looking Statements This presentation and statements by our management may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that include, without limitation, statements on slides ent
Slide 3: Additional Information
3 Additional Information Non-GAAP Financial Measures This presentation contains certain financial information determined by methods other than in accordance with generally accepted accounting principles in the United States (“GAAP”). These non-GAAP financial measures are a supplement to GAAP, which
Slide 4: Largest Regional Banking Company Headquartered in Virginia
4 Largest Regional Banking Company Headquartered in Virginia Our Company Soundness | Profitability | Growth Data as of 9/30/2023, market capitalization as of 10/18/2023 1) Regional bank defined as having less than $100 billion in assets; rank determined by asset size; data per S&P Global Market Inte
Slide 5: Our Shareholder Value Proposition
5 Our Shareholder Value Proposition Leading Regional Presence Dense, uniquely valuable presence across attractive markets Financial Strength Solid balance sheet & capital levels Attractive Financial Profile Solid dividend yield & payout ratio with earnings upside Strong Growth Potential Organic & ac
Slide 6: Strong Presence in Prime Virginia Markets
6 Strong Presence in Prime Virginia Markets (1) Among midsized and community banks less than $100 billion in assets Source: SNL Financial, FDIC deposit data; excludes branches greater than $5 billion Deposit data as of 6/30/2023; Fredericksburg market defined as Caroline, Fredericksburg City, King G
Slide 7: Virginia's Bank and Sizeable Opportunity to Take Market Share from the Big Three
7 Virginia’s Bank and Sizeable Opportunity to Take Market Share from the Big Three Source: SNL Financial and FDIC deposit data Deposit and branch data as of 6/30/23; pro forma for announced transactions, including our proposed merger with American National Note: Excludes branches with deposits great
Slide 8: Virginia Is Among the Most Attractive Markets in USA
8 Virginia Is Among the Most Attractive Markets in USA Source: SNL Financial; Bureau of Economic Analysis; Bureau of Labor Statistics, Fortune.com, U.S. News & World Report; Forbes, CNBC, U.S. Small Business Administration, USA Today; Business Facilities; most recent data available ranked Virginia t
Slide 9: Q3 2023 Highlights and 2023 Outlook
9 Q3 2023 Highlights and 2023 Outlook Loan and Deposit Growth • Customer deposit growth more than funded loan growth in Q3 2023 • 5.7% annualized loan growth in Q3 2023 • 9.1% annualized deposit growth in Q3 2023 • Line of Credit Utilization relatively flat with Q2 2023 Asset Quality • Q3 2023 net c
Slide 10: We are focused on three Strategic Priorities
10 We are focused on three Strategic Priorities Organic Deliver Organic Growth • Overweighting opportunities in Wholesale Banking Group • Directing consumer efforts to market segments and delivery channels with the strongest value proposition • Prioritizing fee income growth • Maintaining a reliable
Slide 11: Balance Sheet Trends (GAAP)
11 $9,971 $13,305 $15,723 $16,611 $15,932 $16,787 2018 2019 2020 2021 2022 3Q 2023 12% CAGR Balance Sheet Trends (GAAP) Data as of December 31 each respective year, except for 3Q 2023, which is as of September 30, 2023 Loans ($mm) Deposits ($mm) Assets ($mm) $9,716 $12,611 $14,021 $13,196 $14,449 20
Slide 12: Strong Track Record of Performance (GAAP)
12 Strong Track Record of Performance (GAAP) Earnings Per Share Available to Common Shareholders ($) Return on Equity (ROE) (%) Return on Assets (ROA) (%) Efficiency Ratio (%) $2.22 $2.41 $1.93 $3.26 $2.97 $1.81 2018 2019 2020 2021 2022 3Q 2023 YTD 7.85% 7.89% 6.14% 9.68% 9.51% 7.93% 2018 2019 2020
Slide 13: Strong Track Record of Performance (Non-GAAP)
13 Strong Track Record of Performance (Non-GAAP) Data as of or for the twelve months ended each respective year, except for 3Q 2023 YTD, which is as of or for the nine months ended September 30, 2023 (1) Non-GAAP financial measure; See reconciliation to most directly comparable GAAP measure in "Appe
Slide 14: Strong Capital Position
14 Capital Ratio Regulatory Well Capitalized Minimums Atlantic Union Bankshares Atlantic Union Bank Atlantic Union Bankshares Atlantic Union Bank Common Equity Tier 1 Ratio (CET1) 6.5% 9.9% 12.7% 7.0% 9.8% Tier 1 Capital Ratio 8.0% 10.9% 12.7% 8.0% 9.8% Total Risk Based Capital Ratio 10.0% 13.7% 13.
Slide 15: Financial Outlook
15 Financial Outlook1 1Key Economic Assumptions • Stabilizing Interest Rate environment • The Federal Reserve Bank fed funds rate holds at 5.50% for the rest of 2023 • Increased likelihood of soft landing • Expect relatively stable economy in AUB’s Virginia footprint in 2023 • Expect Virginia unempl
Slide 16: Appendix
Appendix Atlanti h Gnion Bankshares
Slide 17: Q3 2023 Allowance For Credit Loss (ACL) and Provision for Credit Losses
17 Q3 2023 Allowance For Credit Loss (ACL) and Provision for Credit Losses Q3 Macroeconomic Forecast Moody’s September 2023 Baseline Forecast: • US GDP expected to average ~2.1% growth in 2023 and ~1.4% in 2024. • The national unemployment rate expected to average ~3.7% in 2023 and ~4.1% in 2024. Q3
Slide 18: Attractive Core Deposit Base
18 Attractive Core Deposit Base Deposit Base Characteristics Deposit Composition at September 30, 2023 — $16.8 billion Cost of deposit data is as of or for the three months ended September 30, 2023 (1) Core deposits defined as total deposits less jumbo time deposits and brokered deposits • Q3 2023 c
Slide 19: Loan and Deposit Betas
19 Loan and Deposit Betas 32% 26% 25% 68% 74% 75% Q3 2022 Q2 2023 Q3 2023 Deposit Mix Shift Non Interest Deposits Interest Bearing Deposits $16,546 $16,412 $16,787 12% 17% 26% 30% 36% 0.37% 0.72% 1.28% 1.61% 1.97% Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Total Deposit Beta2 Cumulative Deposit Beta 18
Slide 20: Granular Deposit Base
20 Granular Deposit Base at September 30, 2023 35% 33% 28% 26% 27% $5,821 $5,299 $4,591 $4,346 $4,498 Q3 2022 Q4 2022 Q1 2023 Q2 2023 Q3 2023 Period End Uninsured and Uncollateralized Deposits as a Percentage of Total Deposits ($ in Millions) Top 15 Commercial Deposits by NAICS as of 9/30/2023 NAICS
Slide 21: Diversified and Granular Loan Portfolio
21 Diversified and Granular Loan Portfolio Total Loan Portfolio $15.3 billion at September 30, 2023 Non-Owner Occupied CRE Composition $5.1 billion at September 30, 2023 Total Portfolio Characteristics Duration Q3 2023 Weighted Average Yield (Tax Equivalent) 1.3 years 5.84% Figures may not total to
Slide 22: Non-Owner-Occupied CRE Portfolio
22 Non-Owner-Occupied CRE Portfolio at September 30, 2023 $ in millions Total Outstandings % of Portfolio Multi Family $947 6.2% Retail $852 5.6% Hotel/Motel B&B $804 5.3% Office $792 5.2% Industrial/Warehouse $692 4.5% Senior Living $365 2.4% Self Storage $346 2.3% Other $297 1.9% Total Non-Owner O
Slide 23: Non-Owner-Occupied Office CRE Portfolio
23 Non-Medical Office 78% Medical Offices 22% Medical vs Other Office By Market ($ millions) Key Portfolio Metrics Carolinas $249 Fredericksburg Area $132 Central VA $108 Northern VA/Maryland $67 Western VA $101 Eastern VA $51 Other $86 Total $792 Avg. Office Loan ($ millions) $1.9 Loan Loss Reserve
Slide 24: Liquidity Position
24 Cash and Cash Equivalents (unrestricted) $454 Unencumbered Securities $901 FHLB Borrowing Capacity $1,638 Fed Funds Lines $737 Discount Window (ex-Bank Term Funding Program) $316 Discount Window – Bank Term Funding Program $531 Secondary Sources* $1,347 ($ in millions) Liquidity Position at Septe
Slide 25: Securities Portfolio
25 Securities Portfolio at September 30, 2023 • As of September 30, 2023, total securities portfolio of $2.9 billion with a total unrealized loss of $604.3 million • 71% of total portfolio in available-for-sale at an unrealized loss of $523.1 million • 29% of total portfolio designated as held-to-ma
Slide 26: Reconciliation of Non-GAAP Disclosures
26 Reconciliation of Non-GAAP Disclosures The Company has provided supplemental performance measures on a tax-equivalent, tangible, operating, adjusted, or pre-tax pre-provision basis. These non-GAAP financial measures are a supplement to GAAP, which is used to prepare the Company’s financial statem
Slide 27: Reconciliation of Non-GAAP Disclosures
27 Reconciliation of Non -GAAP Disclosures Adjusted operating measures exclude, as applicable, strategic cost saving initiatives (principally composed of severance charges related to headcount reductions, costs related to modifying certain third party vendor contracts, and charges for exiting certai
Slide 28: Reconciliation of Non-GAAP Disclosures
28 Reconciliation of Non-GAAP Disclosures Pre-tax pre-provision adjusted earnings excludes, as applicable, the provision for credit losses, which can fluctuate significantly from period-to-period under the CECL methodology, income tax expense, strategic cost saving initiatives, merger-related costs,
Slide 29: Reconciliation of Non-GAAP Disclosures
29 Reconciliation of Non -GAAP Disclosures Adjusted operating measures exclude, as applicable, strategic cost saving initiatives (principally composed of severance charges related to headcount reductions, costs related to modifying certain third party vendor contracts, and charges for exiting certai
Slide 30: Reconciliation of Non-GAAP Disclosures
30 Reconciliation of Non-GAAP Disclosures The adjusted operating efficiency ratio (FTE) excludes, as applicable, the amortization of intangible assets, strategic cost saving initiatives, merger-related costs, a legal reserve associated with an ongoing regulatory matter previously disclosed, strategi
Slide 31: Reconciliation of Non-GAAP Disclosures
31 Reconciliation of Non-GAAP Disclosures Tangible assets and tangible common equity are used in the calculation of certain profitability, capital, and per share ratios. The Company believes tangible assets, tangible common equity and the related ratios are meaningful measures of capital adequacy be
Slide 32: Reconciliation of Non-GAAP Disclosures
32 Reconciliation of Non-GAAP Disclosures All regulatory capital ratios at September 30, 2023 are estimates and subject to change pending the Company’s filing of its FR Y-9 C. In addition to these regulatory capital ratios, the Company adjusts certain regulatory capital ratios to include the impacts
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