Columbia Banking System, Inc. · NASDAQ:COLB
Columbia Banking System — Q1 2022 Earnings Presentation
39 slides from Columbia Banking System's earnings presentation, Apr 21, 2022
Slide 1: 1Q 2022 / Forward Looking Statements
NASDAQ - COLB 1Q 2022 Pear Orchard, Hood River Valley, Oregon Forward Looking Statements This presentation includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, which can be identified by words such as “may,” “expected,” “anticipate”, “contin
Slide 2: Lasting Strength
OVERVIEW OF COLUMBIA BANK Lasting Strength Sustained track record of driving long-term shareholder value Maintained a strong capital position with ample liquidity Seasoned acquirer with proven integration success Low-cost deposit funding base Award-winning company that is committed to the communitie
Slide 3: By the Numbers
Potato Farm, Idaho OVERVIEW OF COLUMBIA BANK By the Numbers $21.0 Billion in Total Assets $10.8 Billion in Total Loans $18.3 Billion in Total Deposits 152 Branches 4 Acquisitions Over past 10 years 14.0% Total Risk-Based Capital (1) 10.00% CB 8.7% Leverage Ratio (1) 5.00% CB 3 Represents Well-Capita
Slide 4: Continually Building Value
Continually Building Value October 2021 Acquired: April 2013 November 2017 Bank of Commerce Holdings Acquired: Acquired: $2.0B Assets West Coast Bancorp $2.6B Assets Pacific Continental Corp $2.9B Assets $24.29 $23.85 November 2014 Acquired: Intermountain Community Bancorp $964MM Assets $22.05 $22.0
Slide 5: 1Q 2022 Recap
(1) Pre-tax, Pre-provision Income OVERVIEW OF COLUMBIA BANK Q1 Q2 Q3 Q4 Totals may not foot due to rounding 1Q 2022 Recap 2022 YTD $67 $67 First quarter net income of $57.5 million; 2021 $66 $66 $69 $67 $267 diluted earnings per share of $0.74 2020 $61 $82 $64 $71 $278 Pre-tax, pre-provision income(
Slide 6: Summary Income Statement
Summary Income Statement $ in thousands 1Q22 4Q21 3Q21 2Q21 1Q21 (except EPS) Net Interest Income $146,200 $145,523 $132,540 $125,462 $123,994 Provision/(Recapture) for Credit Losses (7,800) 11,100 — (5,500) (800) Net Interest Income after 154,000 134,423 132,540 130,962 124,794 Provision/(Recapture
Slide 7: Selected Balance Sheet & Ratios
Selected Balance Sheet & Ratios $ in millions Mar 31, 2022 Dec 31, 2021 Sep 30, 2021 Jun 30, 2021 Mar 31, 2021 Total Assets $20,964 $20,945 $18,602 $18,013 $17,335 Securities, Including Debt Securities, Equity Securities 7,754 8,083 6,931 6,238 5,520 & FHLB Stock Loans, Net of unearned Income 10,760
Slide 8: Diversified, Relationship-Centered Deposit Base
Diversified, Relationship-Centered Deposit Base 1Q21 1Q22 $14.8 billion $18.3 billion 60% Business & 40% Consumer 59% Business & 41% Consumer Cost of Deposits = 4 bps Cost of Deposits = 4 bps 10.2% 11.5% 19.7% 19.1% 50.4% 48.1% 8.9% 8.7% 4.2% 4.5% 1.3% 1.3% 0.8% 0.7% 6.1% 4.5% As of Mar 31, 2021 As
Slide 9: Net Interest Margin
Net Interest Margin 4.33% 4.24% 3.67% 3.31% 3.65% 3.17% 3.17% 3.12% 3.16% 3.12% 3.05% 3.25% 3.09% 3.09% 3.15% 3.09% 3.00% 2.99% $535.3 $501.8 $507.6 $486.7 $147.6 $148.3 $134.4 $125.9 $127.4 $148.3 2018 2019 2020 2021 2022 YTD 1Q21 2Q21 3Q21 4Q21 1Q22 Net Interest Income (tax equivalent) Net Interes
Slide 10: Interest Rate Sensitivity
Interest Rate Sensitivity Loan Repricing Detail (in millions) Upward Rate Change to Move from Floor (in millions) (in millions) Dec-21 Mar-22 Dec-21 Mar-22 Loans At <25 26-50 51-75 76-100 101-125 >150 Floor bps bps bps bps bps bps Total Fixed $5,654 $5,764 53 % 54 % Balances (in millions) PPP $188 $
Slide 11: Deposit Rate Sensitivity
Deposit Rate Sensitivity Columbia Bank Deposit Rates vs Federal Funds Relationship-focused deposits well-positioned for rising rates (Fed Effective) 3.00% • Columbia's deposit rate movements have historically lagged and 2.50% were materially less than changes in market rates 2.00% • Deposit growth h
Slide 12: Noninterest Income
Noninterest Income $104,500 $97,181 16,710 $94,094 $88,256 20,024 10,687 8,464 9,211 11,866 22,044 13,465 24,802 12,135 $23,958 $24,240 $24,180 12,799 $23,166 $22,730 15,753 2,325 2,742 3,123 4,275 2,497 19,719 12,830 15,198 4,514 5,184 4,977 3,193 7,369 18,503 4,632 13,928 4,245 4,250 3,877 $24,180
Slide 13: Strong Earnings Performance
Strong Earnings Performance $0.16 $0.09 $0.07 $0.01 $0.02 $0.07 $2.68 $2.78 $2.36 $2.17 $0.74 $0.12 $11,466 $0.77 $0.73 $0.74 $0.74 $202,820 $0.55 $194,451 $6,842 $172,882 $152,244 $403 $5,575 $1,731 $57,522 $55,039 $53,017 $51,853 $9,332 $42,911 $5,575 $57,522 (1) 2018 2019 2020 $0 2021 2022 YTD 1Q
Slide 14: Improved Operating Leverage
Improved Operating Leverage 2.61% 2.59% 2.17% 1.98% 1.87% 1.87% 1.89% 1.92% 1.87% 1.74% $20,956 $20,858 $20,956 $18,448 $18,330 $17,670 $16,892 $15,401 $13,341 $12,725 2018 2019 2020 2021 2022 1Q21 2Q21 3Q21 4Q21 1Q22 Average Total Assets Core NIE/Avg Assets (1) $ in millions 14 (1) Non-GAAP financi
Slide 15: Total Loans
Total Loans Rolling 5 Quarters Loan Production Total Loans, Net of Unearned Income $10.8 billion $895 Annualized Quarterly Growth = 8% (excluding PPP Loans (1)) $657 $640 511 $464 $366 605 384 (2) 1Q21 2Q21 3Q21 4Q21 1Q22 Commercial Loan Originations PPP Loan Originations Business Commercial 32.5% R
Slide 16: Well Diversified C&I and Agriculture Loan Portfolios
Well Diversified C&I and Agriculture Loan Portfolios C&I Portfolio Agriculture Portfolio $3.5 billion $765 million Dairy Cattle Healthcare & Milk 4.3% Production 3.5% Dentists 24.1% Wholesalers Cattle 12.1% 4.5% Fishing Finance/ 5.3% Insurance Other 34.9% 11.9% Contractors 8.0% Row Crops 8.6% Retail
Slide 17: Balanced CRE Loan Portfolio
Balanced CRE Loan Portfolio CRE Portfolio $5.0 billion Consistent CRE Coverage Balanced with 47% Income Property and 53% Owner-occupied 200.6% 195.6% 181.3% 185.6% 184.8% 129.6% 131.1% 132.0% 128.3% 127.0% $6,127 $6,217 Office 21.3% Education Multifamily 9.6% 2.4% 1,170 1,146 $5,016 $5,083 $4,925 84
Slide 18: Components of 1Q Change in Loans
Components of 1Q Change in Loans 1Q22 $464 $19 $(168) $(37) $(97) $(63) $10,760 $10,642 Beginning New Originations Net Advances/ Prepayments Payoffs PPP Payoffs Other Ending Balance Balance Payments 1Q21 $895 $(211) $74 $(216) $(39) $(255) $9,676 $9,428 Beginning New Originations Net Advances/ Prepa
Slide 19: Allowance for Credit Losses (ACL)
Allowance for Credit Losses (ACL) 1.69% 1.59% 1.55% 1.49% 1.38% 1.53% 1.50% 1.48% 1.46% 1.37% $155,578 $148,294 $146,949 $142,988 $142,785 Mar 31, 2021 Jun 30, 2021 Sep 30, 2021 Dec 31, 2021 Mar 31, 2022 (1) Allowance for Credit Losses % Allowance for Credit Losses % Allowance for Credit Losses excl
Slide 20: Nonperforming Assets
Nonperforming Assets 0.46% 0.24% 0.21% $60,891 0.20% 0.11% 0.09% 6,049 0.14% 0.13% 0.11% 0.09% $34,102 $35,359 $33,612 $24,402 $24,557 $23,422 54,842 $23,422 $17,822 33,581 $17,822 33,060 34,806 24,021 24,176 23,041 23,041 17,441 17,441 Dec 31, 2018 Dec 31, 2019 Dec 31, 2020 Dec 31, 2021 Mar 31, 202
Slide 21: Highly Quality Securities Portfolio
Highly Quality Securities Portfolio (1) Investment Portfolio Mix (1) Portfolio is conservatively positioned: $7.6 billion • Strong credit quality with focus on agencies and high-quality municipal securities Municipals 12.4% • About half of the MBS portfolio is Agency Commercial Mortgage Backed Secur
Slide 22: Strong Capital, Dividend Payouts & Total Return
Strong Capital, Dividend Payouts & Total Return 14.7% 14.5% 14.3% 14.2% Total Return Performance 600 500 9.0% 9.0% 8.6% 8.6% 7.5% 400 Index Value $0.77 $0.73 $0.74 $0.74 300 $0.55 200 $0.28 $0.28 $0.30 $0.30 $0.30 100 0 D 1, 8 M 1, 0 D 1, 9 D 1, 1 D 1, 3 D 1, 5 D 1, 7 D 1, 9 31 21 D 1, 8 D 1, 0 D 1,
Slide 23: Diversity, Equity and Inclusion
Diversity, Equity and Inclusion Columbia's Diversity, Equity and Inclusivity program continues to make a positive impact on clients and the broader Northwest Community. Over More than $120,000 $360,000 $100,000 Awarded through the Bank's Provided to BIPOC and Scholarship Fund for NW Equity and Inclu
Slide 24: Dedicated to Our Communities
Fundraising Volunteer Hours Dedicated to Our $388,850 20,549 Communities $369,978 16,373 $430,988 28,313 At Columbia Bank, we empower $342,754 26,944 employees to address the unique needs $303,929 20,614 $286,027 of their communities and offer support 15,336 in the manner that makes the biggest diff
Slide 25: Columbia – An Award-Winning Company
Columbia – An Award-Winning Company 25
Slide 26: Responsibility: ESG Encompasses Columbia's Do RIGHT Values
NEW SLIDE - NEEDS APPROVAL Responsibility ESG Encompasses Columbia's Do RIGHT Values When we Do RIGHT by our people and our clients, shareholders invest and communities prosper. E nvironment S ocial G overnance Investing in Board Climate Valuing our Charitable Stewardship Investment our Independence
Slide 27: Strategic Updates
Strategic Updates 27 Port of Olympia, Puget Sound, Washington
Slide 28: Creating a West Coast Franchise Unlike Any Other
Creating a West Coast Franchise Unlike Any Other Combined company deepens its Synergies anticipated to drive growth in loans, foothold in the Northwest and ...creating a West Coast regional powerhouse deposits, and fee-based products and services* California... • Dramatically increases delivery chan
Slide 29: Current Priorities: Integration and Growth
Current Priorities: Integration and Growth • The top priorities at Columbia and Umpqua are to prepare and execute the seamless integration of our two banks following the closing without disrupting the growth momentum that began in 2H 2020 and that we expect to continue into 2023. • The establishment
Slide 30: Revenue: Scale Expected to Enhances Opportunities
Revenue: Scale Expected to Enhances Opportunities Our combination enables us to: • Lend with a bigger balance sheet ◦ Magnifies the opportunity to grow the loan book as it reduces the need to participate out larger deals, favorably impacting new business and enabling the expansion of existing client
Slide 31: Executive Leadership Team
Executive Leadership Team Port of Tacoma, Washington Investor Relations 253-471-4065 investorrelations@columbiabank.com Clint Stein Kumi Yamamoto Baruffi Aaron James Deer President Executive Vice President Executive Vice President Chief Executive Officer General Counsel Chief Financial Officer Colum
Slide 32: Appendix
Appendix Train Depot, Boise, Idaho 32
Slide 33: Non-GAAP Financial Measures
Non-GAAP Financial Measures Tangible Book Value per Common Share $ in thousands 12/31/11 12/31/12 12/31/13 12/31/14 12/31/15 12/31/16 12/31/17 12/21/18 12/31/19 12/31/20 12/31/21 3/31/22 Total Shareholders' Equity $759,338 $764,008 $1,053,249 $1,228,175 $1,242,128 $1,251,012 $1,949,922 $2,033,649 $2
Slide 34: Non-GAAP Financial Measures
Non-GAAP Financial Measures NIE/Average Assets $ in thousands 2018 2019 2020 2021 2022 1Q21 2Q21 3Q21 4Q21 1Q22 Reported Noninterest Expense (numerator A) $ 340,490 $ 345,482 $ 334,519 $ 360,304 $ 105,053 $ 83,559 $ 84,116 $ 90,007 $ 102,622 $ 105,053 - Acquisition Related Costs (8,661) — — (14,514)
Slide 35: Non-GAAP Financial Measures
Non-GAAP Financial Measures Net Interest Margin $ in Thousands 2018 2019 2020 2021 2022 1Q21 2Q21 3Q21 4Q21 1Q22 Net Interest Income (tax equivalent) (numerator A) $ 486,667 $ 501,770 $ 507,574 $ 535,311 $ 148,268 $ 125,889 $ 127,409 $ 134,439 $ 147,574 $ 148,268 Adjustments to arrive at operating n
Slide 36: Non-GAAP Financial Measures
Non-GAAP Financial Measures Operating Efficiency Ratio Tangible Common Equity $ in thousand 1Q21 2Q21 3Q21 4Q21 1Q22 $ in thousands 3/31/21 6/30/21 9/30/21 12/31/21 3/31/22 Total Shareholders' Equity (numerator Noninterest expense (numerator A) $ 83,559 $ 84,116 $ 90,007 $ 102,622 $ 105,053 A) $2,27
Slide 37: The Power of a Larger Balance Sheet: A Hypothetical Example
The Power of a Larger Balance Sheet: A Hypothetical Example • The opportunities to grow the loan book by expanding business with our existing customer base are dramatic, and they are potentially multiplicative as we continue to win business in our markets. (a) Columbia 9/30/21 Tangible Common Equity
Slide 38: GAAP and Core Case Earnings per Share Accretion
Non-GAAP Reconciliation: GAAP and Core Case Earnings per Share Accretion GAAP ($mm) Core cash ($mm) Millions of diluted shares Columbia 2023E standalone net income $215 $215 78.7 Umpqua 2023E standalone net income 407 407 218.1 Combined net income $623 $623 After-tax cash adjustments Cost savings -
Slide 39: Purchase Accounting Summary
Non-GAAP Reconciliation: Purchase Accounting Summary Tangible Book Value Per Share Dilution Calculation of Intangibles Created Millions of $ millions basic shares $ per share $ millons Columbia Columbia tangible book value as of June 30, 2021 $1,692 78.5 Fixed exchange ratio 0.5989x (-) Reduction in
Columbia Banking System — Q1 2022 Earnings Presentation on 6ix