Columbia Banking System, Inc. · NASDAQ:COLB
Columbia Banking System — Q3 2023 Earnings Presentation
36 slides from Columbia Banking System's earnings presentation, Oct 18, 2023
Slide 1: 3rd Quarter 2023 Earnings Presentation
rd 3 Quarter 2023 Earnings Presentation October 18, 2023
Slide 2: Disclaimer
2 Disclaimer FORWARD-LOOKING STATEMENTS This presentation includes forward-looking statements within the meaning of the "Safe-Harbor" provisions of the Private Securities Litigation Reform Act of 1995, which management believes are a benefit to shareholders. These statements are necessarily subject
Slide 3: Financial Highlights and Summary Financial Statements
FINANCIAL HIGHLIGHTS AND SUMMARY FINANCIAL STATEMENTS Q3 2023
Slide 4: Performance Ratios
4 Performance Ratios For the Quarter Ended Q3 2023 Highlights (compared to Q2 2023) Q3 2023 Q2 2023 Q1 2023 Q4 2022 Q3 2022 ■ Net interest margin decreased 2 basis (1) Net interest margin 3.91 % 3.93 % 4.08 % 4.01 % 3.88 % points to 3.91%. The second full quarter as Efficiency ratio (1) 57.82 % 62.6
Slide 5: Selected Period-End Balance Sheet
5 Selected Period-End Balance Sheet ($ in millions, except per-share data) Q3 2023 Q2 2023 Q1 2023 Q4 2022 Q3 2022 Q3 2023 Highlights (compared to Q2 2023) ASSETS: ■ Net loan growth of $121 million in Q3 Total assets $51,989.6 $53,592.1 $53,994.2 $31,848.6 $31,472.0 2023 was impacted by the sale of
Slide 6: Summary Income Statement
6 Summary Income Statement For the Quarter Ended Q3 2023 Highlights (compared to Q2 2023) ($ in millions, except per-share data) Q3 2023 Q2 2023 Q1 2023 Q4 2022 Q3 2022 Net interest income before provision $480.9 $484.0 $374.7 $305.5 $287.6 ■ Net interest income decreased by $3 million as the increa
Slide 7: Income Statement Component Details
7 Income Statement Component Details For the Quarter Ended September 30, 2023 Q3 2023 Highlights LESS: EQUALS LESS: EQUALS Adjusted ■ GAAP results were adversely impacted by Non-Operating Operating Merger-Related Operating ($ in thousands, except per-share data) GAAP Income Items (1) Income (2) Item
Slide 8: Income Statement Highlights
INCOME STATEMENT HIGHLIGHTS Q3 2023
Slide 9: Net Interest Income and Net Interest Margin
9 Net Interest Income and Net Interest Margin Net Interest Income and Net Interest Margin Net Interest Margin: Q2 2023 vs Q3 2023 $500 $484 $481 5.00% 0.12% 0.05% 0.01% $400 $375 4.50% 3.93% 0.04% 3.91% (0.03)% $305 $288 $ in millions $300 (0.01)% (0.20)% 4.00% 4.08% $200 4.01% 3.88% 3.93% 3.91% 3.5
Slide 10: Interest Rate Sensitivity: Loans
10 Interest Rate Sensitivity: Loans Loan Repricing Detail (1), (2) Loan Maturities at September 30, 2023 ($ in millions) Q2 2023 Q3 2023 Q2 2023 Q3 2023 <=6 7 to 12 13 to 24 25 to 36 37 to 60 61+ Fixed $15,806 $15,793 42 % 42 % ($ in millions) Months Months Months Months Months Months Total Fixed $1
Slide 11: Interest Rate Sensitivity: Balance Sheet
11 Interest Rate Sensitivity: Balance Sheet Interest Rate Simulation Impact on Net Interest Income (1), (2) September 30, 2023 June 30, 2023 September 30, 2022 Ramp Shock Ramp Shock Ramp Shock Year 1 Year 2 Year 1 Year 2 Year 1 Year 2 Year 1 Year 2 Year 1 Year 2 Year 1 Year 2 Up 200 basis points (0.
Slide 12: Non-Interest Income
12 Non-Interest Income For the quarter ended Q3 2023 Highlights (compared to Q2 2023) ($ in millions) Q3 2023 Q2 2023 Q1 2023 Q4 2022 Q3 2022 ■ Revenue from customer-related products Service charges on deposits $17.4 $16.5 $14.3 $12.1 $12.6 increased during the quarter as we Card-based fees 15.7 13.
Slide 13: Realized Cost Synergies Exceeded Original Target
13 Realized Cost Synergies Exceeded Original Target Annualized Cost Synergies Realized by Period End Non-Interest Expense ("NIE"): Q2 2023 vs Q3 2023 $328.6 $200 $(4.4) $1.9 (1) ~$143 million(1) $(2.1) $(1.2) $150 $140 million $(4.1) $ in millions $105 million(1) $304.1 $(10.7) $100 $(3.9) $59 milli
Slide 14: Outlook
14 Outlook Results (1) Full-Year 2023 Outlook (1) Three Months Ended Nine Months Ended Sept 30, 2023 Sept 30, 2023 As of July 19, 2023 As of Oct 18, 2023 Notes Assumes cash balance at 9/30 remains consistent through Average earning assets $49b $45b $45b - $46b $45b - $46b remainder of 2023 Forward o
Slide 15: Balance Sheet Highlights
BALANCE SHEET HIGHLIGHTS Q3 2023
Slide 16: Securities Portfolio Overview
16 Securities Portfolio Overview Available for Sale Securities Portfolio at September 30, 2023 Amortized Unrealized Unrealized % of Total Effective ($ in millions) Current Par Cost Gains Losses Fair Value AFS Portfolio Duration Book Yield U.S. Treasuries $392 $378 $— ($12) $366 4% 2.6 3.55 % U.S. Ag
Slide 17: Liquidity Overview
17 Liquidity Overview Select Balance Sheet Items: Combined Basis Pre-Closing and Consolidated Basis Post-Closing (1) Total Off-Balance Sheet Liquidity Available at September 30, 2023 Sequential Gross Net Three Months Ended Quarter Change ($ in millions) Availability Utilization Availability ($ in mi
Slide 18: Loan Roll Forward Activity
18 Loan Roll Forward Activity Three Months Ended September 30, 2023 Nine Months Ended September 30, 2023 $3,006 $10,884 $74 $37,171 $1,042 ($237) $37,049 $30 $37,171 ($1,444) ($1,268) $ in millions ($92) $ in millions ($515) ($343) $26,156 Beginning New Net Prepayments Payoffs or Other Ending Beginn
Slide 19: Purchase Accounting Details
19 Purchase Accounting Details Adjustment at Closing Remaining Balances at Select Purchase Accounting Items (1) February 28, 2023 June 30, 2023 September 30, 2023 (2) Notes ITEMS TO ACCRETE THROUGH INTEREST INCOME: Available for sale securities - rate discount $(1,011) million $(609) million $(586)
Slide 20: Loan and Lease Characteristics: Overall Portfolio and Q3 2023 Production
20 Loan and Lease Characteristics: Overall Portfolio and Q3 2023 Production Mortgage Portfolio Composition at September 30, 2023 Owner Occupied CRE • Portfolio average loan size of $992,000 • Portfolio average loan size of $477,000 Multifamily, 15% • 3Q23 average loan size of $988,000 • 3Q23 average
Slide 21: CRE and C&I Portfolio Composition
21 CRE and C&I Portfolio Composition CRE Portfolio Composition (1) C&I Portfolio Composition (1) $17.4 Billion at September 30, 2023 $9.5 Billion at September 30, 2023 Special Purpose, 7.6% Hotel/Motel, 4.2% Other, 11.3% Agriculture, 9.0% Other Healthcare, 3.3% Contractors, 7.6% Retail, 11.9% Other,
Slide 22: Office Portfolio Details
22 Office Portfolio Details Office Portfolio Metrics at September 30, 2023 Number of Loans by Balance ■ Loans secured by office properties Average loan size $1.3 million represented 8% of our total loan 1,746 1,719 1,698 portfolio at September 30, 2023. Average LTV 56% DSC (non-owner occupied) 1.73x
Slide 23: Allowance for Credit Losses (ACL)
23 Allowance for Credit Losses (“ACL”) Allowance for Credit Losses by Loan Segment Current Expected Credit Losses (“CECL”) Details Q3 2023 Net % of Loans and ■ Provision expense of $37 million includes $35 (Charge-offs) Reserve Build Leases ($ in thousands) 6/30/2023 Recoveries (Release) 9/30/2023 O
Slide 24: Credit Quality
24 Credit Quality ■ If the remaining credit discount on loans of $86 million at September 30, 2023 is added to the ACL of $438 million at September 30, 2023, the ACL would increase to 1.41% of loans from the reported 1.18% level. ■ The increase in classified asset ratios between December 31, 2022 an
Slide 25: Diversified Commercial Bank Business Model Supports Granular Deposit Base
25 Our Diversified Commercial Bank Business Model with a Strong Retail Presence Supports our Granular, High-Quality Deposit Base Deposits by Type Deposits by Customer Segment September 30, 2023 Average consumer account balance $19 thousand Average commercial account balance $109 thousand Average cus
Slide 26: Capital Management
26 Capital Management 12.0% 11.5% 1.0% 10.0% 9.4% 9.4% 0.9% 8.0% 7.4% 2.4% 1.4% 6.0% 10.5% 4.0% 8.5% 7.0% 6.0% 2.0% —% Tier 1 Leverage CET1 Tier 1 Risk-Based Total Risk-Based Capital Threshold ¹ Capital Above Threshold ² ■ Declared a quarterly cash dividend of $0.36 per common share on August 14, 20
Slide 27: Appendix
APPENDIX Income Statement Component Details Comparisons and Other Non-GAAP Reconciliation
Slide 28: Income Statement Component Details: GAAP Income
28 Income Statement Component Details: GAAP Income For the Quarter Ended Notable Items ($ in thousands, except per-share data) Q3 2023 Q2 2023 Q1 2023 Q4 2022 Q3 2022 Interest income $696,013 $675,729 $475,951 $352,247 $303,528 ■ Q1 2023 results include only one month Interest expense 215,138 191,75
Slide 29: Income Statement Component Details: Impact of Non-Operating Items
29 Income Statement Component Details: Impact of Non-Operating Items For the Quarter Ended Notable Items ($ in thousands, except per-share data) Q3 2023 Q2 2023 Q1 2023 Q4 2022 Q3 2022 Interest income $— $— $— $— $— ■ This table represents items that are Interest expense — — — — — excluded from GAAP
Slide 30: Income Statement Component Details: Operating Income (Non-GAAP)
30 Income Statement Component Details: Operating Income (Non-GAAP) For the Quarter Ended Notable Items ($ in thousands, except per-share data) Q3 2023 Q2 2023 Q1 2023 Q4 2022 Q3 2022 Interest income $696,013 $675,729 $475,951 $352,247 $303,528 ■ The components of this table represent Interest expens
Slide 31: Income Statement Component Details: Impact of Merger-Related Items
31 Income Statement Component Details: Impact of Merger-Related Items For the Quarter Ended Notable Items ($ in thousands, except per-share data) Q3 2023 Q2 2023 Q1 2023 Q4 2022 Q3 2022 Interest income $76,840 $74,723 $31,895 $387 $789 ■ This table represents merger-related Interest expense (430) (3
Slide 32: Income Statement Component Details: Adjusted Operating Income (Non-GAAP)
32 Income Statement Component Details: Adjusted Operating Income (Non-GAAP) For the Quarter Ended Notable Items ($ in thousands, except per-share data) Q3 2023 Q2 2023 Q1 2023 Q4 2022 Q3 2022 Interest income $619,173 $601,006 $444,056 $351,860 $302,739 ■ The components of this table represent Intere
Slide 33: Non-GAAP Reconciliation: Tangible Capital and Net Interest Income & Margin
33 Non-GAAP Reconciliation: Tangible Capital and Net Interest Income & Margin For the Quarter Ended ($ in thousands, except per-share Sep 30, Jun 30, Mar 31, Dec 31, Sep 30, data) 2023 2023 2023 2022 2022 ($ in thousands) Q3 2023 Q2 2023 Q1 2023 Q4 2022 Q3 2022 Total shareholders' equity a $4,632,16
Slide 34: Non-GAAP Reconciliation
34 Non-GAAP Reconciliation For the Quarter Ended For the Quarter Ended ($ in thousands) Q3 2023 Q2 2023 Q1 2023 Q4 2022 Q3 2022 ($ in thousands) Q3 2023 Q2 2023 Q1 2023 Q4 2022 Q3 2022 Net interest income c $ 480,875 $ 483,975 $ 374,698 $ 305,479 $ 287,604 Non-Interest Income Adjustments Gain on sal
Slide 35: Non-GAAP Reconciliation (cont.)
35 Non-GAAP Reconciliation (cont.) For the Quarter Ended For the Quarter Ended ($ in thousands, except per-share data) Q3 2023 Q2 2023 Q1 2023 Q4 2022 Q3 2022 ($ in thousands) Q3 2023 Q2 2023 Q1 2023 Q4 2022 Q3 2022 Select Per-Share & Performance Metrics Earnings-per-share - basic (1) j/r $ 0.65 $ 0
Slide 36: www.columbiabankingsystem.com
www.columbiabankingsystem.com
Columbia Banking System — Q3 2023 Earnings Presentation on 6ix