South Plains Financial, Inc. · NASDAQ:SPFI
South Plains Financial — Q3 2020 Earnings Presentation
21 slides from South Plains Financial's earnings presentation, Oct 27, 2020
Slide 1: South Plains Financial Earnings Presentation Third Quarter, 2020
South Plains Financial Earnings Presentation Third Quarter, 2020 1
Slide 2: Safe Harbor Statement and Other Disclosures
Safe Harbor Statement and Other Disclosures FORWARD-LOOKING STATEMENTSThis presentation contains, and future oral and written statements of South Plains Financial, Inc. (“South Plains” or the “Company”) and City Bank (“or the “Bank”) may contain, statements about future events that constitute forwar
Slide 3: Today's Speakers
Today’s Speakers 3 Curtis C. GriffithChairman & Chief Executive Officer Elected to the board of directors of First State Bank of Morton, Texas, in 1972 and employed by it in 1979Elected Chairman of the First State Bank of Morton board in 1984Chairman of the Board of City Bank and the Company since 1
Slide 4: Third Quarter 2020 Highlights
$3.5 Billion in Total Assets as of September 30, 2020 Parent Company of City Bank, a leading Texas-based community bank headquartered in Lubbock, TX Third Quarter 2020 Highlights 4 Pre-Tax, Pre-Provision income of $26.9 million, compared to $20.1 million in 2Q’20 and $10.7 million in 3Q’19Net Income
Slide 5: COVID-19 Loan Modifications – Updated
(Dollars in thousands) Total # of Active Active Mod % Loan Segment Balance Loan Mods Mods of Segment Hospitality $ 119,360 35 $ 72,330 60.6% Hotels (Under Construction) 18,809 - - 0.0% All Other CRE 517,264 19 23,388 4.5% Oil & Gas 70,642 16 2,362 3.3% Restaurant & Retail - Owner Occ. 85,412 7 2,747
Slide 6: COVID-19 Loan Modifications – Updated
COVID-19 Loan Modifications – Updated (As of September 30, 2020) 6 Modifications other than 6mo interest only are < 4.0% of the current loan portfolioOther modifications were primarily hotel loans that had interest-only periods of 12 months or a combination of a 90 day deferral and 9 months of inter
Slide 7: Loan Portfolio
Loan Portfolio 7 Total Loans decreased $43.5 million compared to 2Q’20Decrease in total loans was due primarily to:$18.1 million in pay downs on non-residential consumer loans and direct energy loansLower seasonal agricultural production loan funding Yield stabilized in 3Q’20 after 50bps drop in 2Q’
Slide 8: Loan Portfolio Composition
Loan Portfolio 8 Portfolio Composition (Dollars in thousands) Loan Portfolio 3Q’20 Commercial C&D $ 88.1 Residential C&D 154.5 CRE Owner/Occ. 212.3 Other CRE Non Owner/Occ. 432.4 Multi-Family 60.6 C&I 291.5 Agriculture 203.0 1-4 Family 372.1 Auto 193.0 Other Consumer 68.9 PPP 211.8 Total $ 2,288.2 S
Slide 9: Select Loan Industry Concentration Detail
Hospitality Select Loan Industry Concentration Detail 9 As of September 30, 2020 DirectEnergy Total direct energy loans of $71 million93% support services, 7% upstreamNearly 100% Permian and Palo Duro Basins12% of energy sector classifiedALLL on energy sector is 5.3% Total operating hospitality loan
Slide 10: Noninterest Income
Noninterest Income 10 Noninterest Income$ in Millions 3Q’20 Highlights Noninterest income is $31.7 million, compared to $14.1 million in 3Q’19Revenue from mortgage banking activities improved $14.4 million based on an increase of 110% in production in 3Q’20 compared to 3Q’19Fee income primarily driv
Slide 11: Diversified Revenue Stream
Diversified Revenue Stream Nine Months Ended September 30, 2020 11 Total Revenues$167.4 million Noninterest Income$75.4 million Source: Company documents
Slide 12: Net Interest Income and Margin
Net Interest Income and Margin 12 Net Interest Income & Margin$ in Millions 3Q’20 Highlights Net interest income of $31.3 million, compared to $26.6 million in 3Q’19The increase as compared to 3Q’19 was a result of:$414 million rise in average loans primarily from the WTSB acquisition and PPP loans
Slide 13: Deposit Portfolio
Deposit Portfolio 13 Total Deposits$ in Millions 3Q’20 Highlights Total Deposits of $2.94 billion at 3Q’20, which is a decrease of $4.0 million from 2Q’20Cost of interest-bearing deposits declined in 3Q’20 to 50bps from 130bps in 3Q’19Noninterest-bearing deposits represented 30.8% of deposits in 3Q’
Slide 14: Credit Quality
Credit Quality 14 3Q’20 Highlights Credit Quality Ratios Recorded a $6.1 million provision for loan losses in 3Q’20 as compared to $13.1 million in 2Q’20 as the result of modest improvements in the economy Total classified loans decreased $3 million in 3Q’20Nonaccrual loans increased $6 million in 3
Slide 15: Investment Securities
Investment Securities 15 3Q’20 Highlights Investment Securities totaled $726.3 million at 3Q’20, a decrease of $4.4 million from 2Q’20All municipal bonds are in TexasAll MBS, CMO, and Asset Backed securities are U.S. Government or GSE 3Q’20 Securities Composition $726.3mm Securities & Cash$ in Milli
Slide 16: Noninterest Expense and Efficiency
Noninterest Expense and Efficiency 16 Noninterest Expense$ in Millions 3Q’20 Highlights Noninterest expense for 3Q’20 increased from 3Q’19 due to an increase of $5.5 million in commissions and higher variable expenses related to strong mortgage activity3Q’20 includes a recovery of $303 thousand from
Slide 17: Balance Sheet Growth and Development
Balance Sheet Highlights$ in Millions Balance Sheet Growth and Development 17 Tangible Book Value Per Share Note: Tangible book value per share is a non-GAAP measure. See appendix for the reconciliation to GAAP Source: Company documents
Slide 18: Strong Capital Base
Strong Capital Base 18 Total Stockholders’ Equity to Total Assets Ratio Common Equity Tier 1 Ratio Tier 1 Capital to Average Assets Ratio Total Capital to Risk-Weighted Assets Ratio Source: Company documents
Slide 19: Appendix
Appendix South Plains Fin al, In
Slide 20: Non-GAAP Financial Measures
Non-GAAP Financial Measures 20 As of and for the quarter ended September 30,2020 June 30,2020 March 31,2020 December 31,2019 September 30,2019 Efficiency Ratio Noninterest expense $ 35,993 $ 35,207 $ 34,011 $ 31,714 $ 30,028 Net interest income $ 31,273 $ 30,448 $ 30,199 $ 28,624 $ 26,568 Tax equiva
Slide 21: Non-GAAP Financial Measures
Non-GAAP Financial Measures 21 As of September 30,2020 December 31,2019 Tangible common equity Total common stockholders' equity $ 352,568 $ 306,182 Less: goodwill and other intangibles (27,502) (27,389) Tangible common equity $ 325,066 $ 278,793 Tangible assets Total assets $ 3,542,666 $ 3,237,167
South Plains Financial — Q3 2020 Earnings Presentation on 6ix