Independent Bank Corp. · NASDAQ:INDB
Independent Bank — Q1 2023 Earnings Presentation
16 slides from Independent Bank's earnings presentation, Apr 21, 2023
Slide 1: Q1 2023 Earnings Presentation
Exhibit 99.2 Q1 2023 Earnings Presentation April 21, 2023
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the financial condition, results of operations and business of the Company. These statements may be identified by such
Slide 3: Non-GAAP Financial Measures
Non-GAAP Financial Measures This presentation contains financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America (“GAAP”). This information includes operating net income and operating earnings per share ("EPS"),
Slide 4: Highlights
Highlights Key Operating Metrics Q1 2023 Key Drivers of Q1 2023 Net Income (in millions) $ 61.2 • Flat overall loan balances • 3.8% Diluted Earnings Per Share $ 1.36 decrease in deposits; increased liquidity Return on Average Assets 1.30% • Record level of deposits from "new to Return on Average Equ
Slide 5: Deposit Balances
Deposit Balances Period Ended $ Increase % Increase Deposit Product Type 3/31/2023 12/31/2022 (Decrease) (Decrease) ($ in millions) Noninterest-bearing demand deposits $ 5,084 $ 5,441 $ (357) (6.6)% Savings and interest checking accounts 5,639 5,898 (259) (4.4)% Money market deposits 3,094 3,344 (25
Slide 6: Uninsured Deposits
Uninsured Deposits Period Ended 3/31/2023 12/31/2022 % of Avg. % of Avg. $ Amount $ Amount Deposits Deposits ($ in millions) Period end total deposits $ 15,272 $ 15,879 Average Deposits Average Deposits <$250,000 8,657 55.6% 8,523 52.6% Average Deposits >$250,000 6,913 44.4% 7,686 47.4% $ 15,570 $ 1
Slide 7: Liquidity
Liquidity Interest Earning On Balance Sheet Liquidity Cash ($ in millions) 12/31/2022 $ 177 Major Sources Proactive borrowing 300 Share repurchase funding 120 $879 million increase in FHLB Borrowings Other borrowings 459 ($300 million hedged at 3.68% over 3.5 years) Securities cash flow 44 Major Use
Slide 8: Q1 2023 Securities Portfolio
Q1 2023 Securities Portfolio Available for Sale (AFS) Held to Maturity (HTM) Unrealized Unrealized Portfolio Composition as of Q1 2023 Book Value Fair Value Gain/Loss Book Value Fair Value Gain/Loss ($ in millions) U.S. government agency securities $ 231 $ 205 $ (26) $ $31 $ $29 $ (2) U.S. treasury
Slide 9: Loan Portfolio
Loan Portfolio Period Ended $ Increase % Increase Loan Category 3/31/2023 12/31/2022 (Decrease) (Decrease) ($ in millions) Commercial and industrial $ 1,650 $ 1,635 $ 15 0.9% Commercial real estate 7,820 7,760 60 0.8% Commercial construction 1,046 1,154 (108) (9.4)% Small business 226 219 7 3.2% Tot
Slide 10: Loan Highlights
Loan Highlights CRE & Construction Portfolio C&I Portfolio $8.9 billion $1.7 billion All Other (10 All Other - 7.4% Sectors) - 17% Healthcare - 2.8% Professional, Retail Trade - 23% Hotels/Motels - 7.8% Scientific, and Residential - Technical Related - 37.7% Services - 5% Industrial Warehouse - Fina
Slide 11: CRE and Construction Office Properties
CRE and Construction Office Properties Demographic Details CRE & Construction Office Portfolios by Type $1.7 billion * Avg. Loan City/State Balance Balance ($ in millions) Office - Mixed Use Office/Retail - 24.4% Boston, MA $ 305.4 $ 7.4 Office - Class A - 31.9% Waltham, MA 111.1 11.1 Providence, RI
Slide 12: Asset Quality
Asset Quality Nonperforming Loans Net Charge-offs/(Recoveries) ($ in millions) ($ in millions) 0.45% $55.9 $56.0 $54.9 $56.2 $60 0.20% $0.5 $1 $0.4 0.40% 0.41% 0.41% $30 0.10% 0.40% $0.2 0.39% 0.01% 0.01% 0.02% $0.0 0.35% $0 $0 0.00% 0.00% Q2 2022 Q3 2022 Q4 2022 Q1 2023 Q2 2022 Q3 2022 Q4 2022 Q1 2
Slide 13: Net Interest Margin Analysis
Net Interest Margin Analysis Q1 2023 Q4 2022 Net Interest Margin Volume Interest Margin Volume Interest Margin 4.00% Impact Impact 3.85% 3.79% ($ in millions) 3.75% 3.64% 3.82% 3.78% Reported Total $ 17,124.1 $ 160.1 3.79% $ 17,475.3 $ 169.4 3.85% Acquisition fair value 3.50% 3.59% marks: 3.27% Loan
Slide 14: Noninterest Income
Noninterest Income Three Months Ended Investment management: Focal Point March 31 December 31 Assets Under Administration Noninterest Income 2023 2022 ($ in thousands) $6,145 $6,000 $5,793 $ in millions Deposit account fees $ 5,916 $ 5,788 Interchange and ATM fees 4,184 4,282 $5,157 Investment $5,00
Slide 15: Noninterest Expense
Noninterest Expense Efficiency Ratio - GAAP Basis Three Months Ended 70.00% March 31 December 31 Noninterest Expense 2023 2022 ($ in thousands) 60.00% Salaries and employee 52.69% benefits $ 56,975 $ 53,754 50.00% 52.42% Occupancy and 48.60% 47.28% equipment expenses 12,822 12,586 40.00% Q2 2022 Q3
Slide 16: 2023 Forward Guidance
2023 Forward Guidance In general, significant uncertainty persists in the near term. Updated expectations are as follows: Loans: • Flat overall loan balances Deposits: • Deposit pricing remains elevated • Composition: continued migration from noninterest-bearing to interest-bearing • Total deposit b