Amerant Bancorp Inc. · NYSE:AMTB
Amerant Bancorp — Investor Presentation (September 2020)
38 slides from Amerant Bancorp's investor presentation, Sep 30, 2020
Slide 1: Investor Presentation
Investor Presentation As of September 30, 2020
Slide 2: Important Notices and Disclaimers
2 Important Notices and Disclaimers Forward-Looking Statements This presentation contains “forward-looking statements” within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, including, without limitation, future financial and operating results; costs and revenues;
Slide 3: Who We Are
3 Who We Are Mission Vision To provide our customers with the To be recognized as a trusted financial financial products and services they advisor dedicated to building stronger need to achieve their success and life and deeper customer relationships in goals, with an inspired talented team, the mar
Slide 4: About Us
About Us 4 Financial Highlights (in millions, except per share data and percentages) 2015 2016 2017 2018 2019 3Q20 YTD • Founded in 1979 Balance Sheet • Acquired in 1987 by MSF (1) A ssets $ 8 ,1 63 $ 8 ,434 $ 8 ,4 37 $ 8 ,1 24 $ 7 ,9 85 $ 7 ,9 77 • 80.1% spin-off in Aug. 2018 L oans 5 ,6 23 5 ,7 65
Slide 5: Investment Opportunity Highlights
Investment Opportunity Highlights 5 Established Strong and Well-Positioned Significant Fee Pathway to Franchise in Diverse Deposit Loan Income Strong Attractive Base Portfolio Platform Profitability Markets • Long history with • Combination of • Loan book well- • Wealth management • Dynamic initiati
Slide 6: Experienced Management Team
6 Experienced Management Team Frederick • C hairman since January 2019 Copeland • Director of Company and Bank from 2007 to 2018 • Former President and CEO of Far East National Bank Chairman of the Board • Former President and CEO of Aetna International, Inc. 79 years old • Former Chairman, Presiden
Slide 7: Market Strategy
7 Market Strategy Our strategy is to operate and expand in high-growth, diverse economies where we can build from our heritage serving the Hispanic community Miami-Dade MSA Target markets have: • Major industry sectors are trade, tourism, services, manufacturing, education, and real estate • Substan
Slide 8: Growing and Diverse Markets
Growing and Diverse Markets 8 Branch Footprint (1) Deposit Market Share (2) Market Demographics October 31, 2020 June 30, 2020 2010 – 2020 Est. Population Change 18 banking centers Deposits % of Market Market Branches ($mm) A MTB Share % $4,992 Miami-Dade, FL (3) 10 81.4 3.1 Florida Broward, FL 6 36
Slide 9: Value Proposition and Brand Attributes
9 Value Proposition and Brand Attributes High Touch Service • Dynamic • Adaptable Meant for You • Attentive • Diligent • Responsive • Innovative By leveraging our experience and knowledge, we proactively Trustworthy anticipate your financial needs based on where you are and • Dependable where you pl
Slide 10: Ongoing Business Transformation
10 Ongoing Business Transformation From... To... Part of a diverse international financial group, with Focused on traditional community banking business a sophisticated international customer base in the U.S. and an international business to service valued relationships A number of non-core products
Slide 11: Summary of Our Strategic Plan
Summary of Our Strategic Plan 11 Building on our strengths to shape our future Domestic focus Expanding Growth in Core, Increased with an Strong Credit Business and Domestic Profitability International Culture(1) Geographic Deposits and Returns Heritage Presence ▪ Grow U.S. ▪ C ompleted exit ▪ C ont
Slide 12: Build on Improving Financial Performance
Build on Improving Financial Performance 12 Increased Attractive Risk- Higher Net Rationalizing Domestic Adjusted Loan Interest Cost Structure Deposits Profile (1) Margin Non-performing Domestic Net Interest Efficiency Loans (2) Deposits Margin (3) Ratio (3)(4) / Total Loans ($ in millions) 10.8% C
Slide 13: Deep Culture of Enterprise Risk Management
13 Deep Culture of Enterprise Risk Management ✓ Enterprise-Wide Risk Governance ✓ Risk Culture ✓ Risk Appetite ✓ Strategic Planning Board of Directors Senior Management Three Lines of Defense 1 Front Line Units 2 Risk Management 3 Internal Audit • Own and manage their • Independent from front • Dire
Slide 14: Investment Portfolio
Investment Portfolio 14 Balances and Yields (1) Highlights ($ in millions) • Effective duration of 2.4 years as mortgage securities' prepayment speeds ramped up in the third quarter • Floating portion of the portfolio at 13.3% of the total portfolio • Continued purchasing higher-yielding corporate s
Slide 15: Strategic Shift in Loan Mix Yielding Benefits
Strategic Shift in Loan Mix Yielding Benefits 15 Loan Portfolio Loan Mix by Geography September 30, 2020 December 31, 2015 September 30, 2020 Domestic International Highlights • Continued focus on domestic lending activities. Domestic loan CAGR of 6.6% since 2015 • Average loan yields have increased
Slide 16: Balanced CRE Loan Portfolio
16 Balanced CRE Loan Portfolio CRE Portfolio CRE Loan Mix by Primary Market Area(1) September 30, 2020 September 30, 2020 Highlights (2) • Well diversified among geographies and property types, with construction representing 11.2% • Conservative weighted average LTV 60% and DSC 1.7x • Strong sponsor
Slide 17: Disciplined Credit Culture
Disciplined Credit Culture 17 Robust Underwriting Standards Non-performing Assets(2) / Total Assets • Credit quality remains sound and reserve coverage is strong • Provision for loan losses of $18.0 million in the third quarter 2020; lowest recorded in any quarter this year and reflects improving 1.
Slide 18: Highly Attractive Deposit Franchise
18 Highly Attractive Deposit Franchise Highlights Deposit Mix (1) • Focused on developing domestic relationships as opposed to rate (2) September 30, 2020 sensitive, non-relationship time deposits • Working on protecting and growing low cost deposits • Experienced 11% C AGR in domestic deposits as a
Slide 19: Wholesale Funding & Debt by Maturity
Wholesale Funding (1) & Debt (2) by Maturity 19 September 30, 2020 ($ in millions) Year of Maturity Interest Rate 3Q19 2Q20 3Q20 2019 1.80% to 2.28% $ 195 $ — $ — 2020 1.50% to 2.56% 325 — — 2021 1.93% to 3.08% 240 — — 2022 0.65% to 2.80% 320 50 50 2023 and after 0.62% to 8.90% 182 1,123 1,123 (4) (
Slide 20: Interest Income and Margin Trends
Interest Income and Margin Trends 20 Highlights Impact on NII from Interest Rate Change (2) ($ in M illions and percentages) • Proactive steps in 3Q20 to preserve NIM: (A s of September 30, 2020) ◦ Strategic deposit rate cuts on C Ds and relationship money market accounts, in addition to maturities
Slide 21: Wealth Management Franchise Expansion
21 Wealth Management Franchise Expansion Key Component of Noninterest Income 2020 YTD Noninterest Income Mix Wealth Management Platform Total: $62.0 million Amerant Trust Amerant Investments • Estate Planning • Brokerage Services • Asset Protection • Investment • Escrow Services Advisory Services (3
Slide 22: Increasing Operating Efficiency
22 Increasing Operating Efficiency Cost Initiatives Efficiency Ratio (1) 1. Simplification of business model and product offerings following Rationalization spin-off of Business 2. De-emphasized international Lines business resulting in less complexity and reduced costs 1. Investments in technology
Slide 23: Drivers for Improvement
Drivers for Improvement 23 1 Technology, Operating Model and Expense Saving Initiatives Continue to rationalize expenses and improve scalable platform, while investing in digital transformation to drive great customer experience and increase future profitability 2 Changing Business Mix Redeploy lowe
Slide 24: Investment Highlights
24 Investment Highlights Focus on driving profitable growth and shareholder value Substantial and continuing insider ownership, approximately 30% Strong asset quality and domestic loan growth Focus on expanding domestic deposit base throughout our high growth U.S. markets Low cost deposits from inte
Slide 25: Supplemental Information: COVID-19 Update
Supplemental Information COVID-19 Update
Slide 26: Business Update Related to COVID-19
Business Update Related to COVID-19 1 26 • Amerant’s Business Continuity Plan (“BCP”) continues to successfully support employees Business with remote work capabilities Continuity • Company moved into a new phase of reintroducing a higher number of employees back Plan into the workplace following sa
Slide 27: Loan portfolio by industry
27 Loan portfolio by industry (September 30, 2020) Real Non-Real % Total Unfunded ($ in millions) Estate Estate Total Loans Highlights Commitments(8) Financial Sector (1) $ 5 $ 70 $ 75 1.3 % $ 18 Construction and Real Estate & Leasing: Commercial real estate loans 2,986 — 2,986 50.4 % 192 • Diversif
Slide 28: Industries with escalated monitoring: CRE Hotels
28 Industries with escalated monitoring CRE Hotels (As of 09/30/2020) Hotels Hotels - LTV Total: $271 million Loan Portfolio Percentage: 4.6% Highlights • CRE Hotel portfolio is limited to 27 properties, majority of which are in popular travel destinations such as Miami Beach (#9 / $106 MM) and New
Slide 29: Industries with escalated monitoring: CRE Retail
Industries with escalated monitoring 29 CRE Retail (As of 09/30/2020) CRE Retail - Single Retail - LTV CRE Retail(1) Tenant(1) Total: $1.1 billion Total: $197 million Loan Portfolio Percentage: 18.9% Loan Portfolio Percentage: 3.3% (1) CRE retail loans above $5 million Highlights • Florida and Texas
Slide 30: Appendices
Appendices
Slide 31: Appendix Summary Financial Statements
31 Appendix 1 Summary Financial Statements December 31, September 30, (in millions) 2015 2016 2017 2018 2019 2020 A ssets C ash and cash equivalents $ 1 38.3 $ 1 35.0 $ 1 53.4 $ 8 5.7 $ 1 21.3 $ 2 27.2 T otal Securities (1) 2 ,0 55.6 2 ,1 23.2 1 ,7 77.0 1 ,6 71.2 1 ,6 66.5 1 ,4 03.8 L oans Held for
Slide 32: Appendix Summary Financial Statements (cont'd)
32 Appendix 1 Summary Financial Statements (cont’d) Years ended December 31, Nine months ended September 30, (in thousands) 2015 2016 2017 2018 2019 2020 Total Interest Income $208,199 $238,827 $273,320 $309,358 $312,974 $197,399 Total Interest Expense 35,914 46,894 63,610 90,319 99,886 56,499 Net I
Slide 33: Non-GAAP Financial Measures Reconciliations
33 Appendix 2 Non-GAAP Financial Measures Reconciliations Explanation of Certain Non-GAAP Financial Measures This Presentation contains certain adjusted financial information, and their effects on noninterest income, noninterest expense, income taxes, net income, operating income, efficiency ratios,
Slide 34: Non-GAAP Financial Measures Reconciliations (cont'd)
Appendix 2 34 Non-GAAP Financial Measures Reconciliations (cont’d) (in thousands) 3Q20 YTD 2019 2018 2017 T otal noninterest income $ 6 1 ,955 $ 5 7 ,110 $ 5 3 ,875 $ 7 1 ,485 L ess: gain on sale of vacant Beacon land — (2 ,7 95) — — L ess: gain on sale of N ew Y ork building — — — (1 0 ,469) A djus
Slide 35: Non-GAAP Financial Measures Reconciliations (cont'd)
35 Appendix 2 Non-GAAP Financial Measures Reconciliations (cont’d) (in thousands) 3Q20 YTD 2019 2018 2017 N et (loss) income $ (1 0 ,195) $ 5 1 ,334 $ 4 5 ,833 $ 4 3 ,057 P lus after-tax restructuring c osts: Res tructuring c osts before income tax effect 3 ,5 18 5 ,0 46 6 ,3 95 — I nc ome tax effec
Slide 36: Non-GAAP Financial Measures Reconciliations (cont'd)
Appendix 2 36 Non-GAAP Financial Measures Reconciliations (cont’d) 3Q20 YTD 2019 2018 2017 Bas ic (loss) earnings per share $ (0 .2 4) $ 1 .2 1 $ 1 .0 8 $ 1 .0 1 P lus: after tax impact of restructuring costs 0 .0 6 0 .0 9 0 .1 2 — P lus: after tax impact of total spin-off c osts — — 0 .1 6 0 .0 7 P
Slide 37: Non-GAAP Financial Measures Reconciliations (cont'd)
37 Appendix 2 Non-GAAP Financial Measures Reconciliations (cont’d) (in thousands, except per share data and percentages) 3Q20 YTD 2019 2018 2017 E ffic iency ratio 6 2 .66 % 7 7 .47 % 7 8 .77 % 7 3 .84 % L ess: impact of restructuring c osts (1 .7 4) % (1 .8 9) % (2 .3 4) % — % L ess: impact of tota
Slide 38: Thank you
AMERANT Thank you
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