S&t Bancorp, Inc. · NASDAQ:STBA
S&t Bancorp — Q1 2018 Earnings Presentation
34 slides from S&t Bancorp's earnings presentation, May 8, 2018
Slide 1: First Quarter 2018
First Quarter 2018 MEMBER FDIC
Slide 2: Forward Looking Statement and Risk Factors
Forward Looking Statement and Risk Factors This presentation contains or incorporates statements that we believe are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally relate to our financial condition, results
Slide 3: Non-GAAP Financial Measures
Non-GAAP Financial Measures In addition to the results of operations presented in accordance with Generally Accepted Accounting Principles (GAAP), S&T management uses and this presentation contains or references certain non- GAAP financial measures, such as net interest income on a fully taxable equ
Slide 4: Corporate Profile
Corporate Profile Corporate Profile • Headquartered in Indiana, PA • $7.0 billion in assets (as of 03.31.18) • $1.4 billion market cap (as of 03.31.18) • Locations in 5 regional markets • Stock symbol: STBA 3
Slide 5: STBA Investment Thesis
STBA Investment Thesis STBA Investment Thesis • Above peer performance • Demonstrated expense discipline and efficiency • Organic growth • Strategic and effective mergers and expansion • Stable regional markets with long-term oil and gas benefit • Sound asset quality 4
Slide 6: STBA Investment Thesis: The Right Size
STBA Investment Thesis The Right Size • Big enough to: • Provide full complement of products and services • Access technology • Access capital markets • Attract talent • Expand – mergers and acquisitions/de novo • Small enough to: • Stay close to our customers • Understand our markets • Be responsiv
Slide 7: Performance: Return on Average Assets
Performance Return on Average Assets 1.8% 1.6% 1.51% 1.4% 1.22% 1.22%(2) 1.2% 1.13% 1.08% Peer(1) 1.0% 1.03% 0.8% 0.6% 0.4% 0.2% 0.0% 2014 2015 2016 2017 1Q18 (1) BHCPR Peer Group 2: Bank Holding Companies with $3-10 Billion of Assets (2)This is a non-GAAP number that adjusts for the effects of a on
Slide 8: Performance: Return on Average Equity
Performance Return on Average Equity 15.0% 12.5% 11.92% (2) 9.71% 9.90% 10.0% Peer(1) 8.94% 8.67% 8.37% 7.5% 5.0% 2.5% 0.0% 2014 2015 2016 2017 1Q18 (1) BHCPR Peer Group 2: Bank Holding Companies with $3-10 Billion of Assets (2)This is a non-GAAP number that adjusts for the effects of a one-time, no
Slide 9: Performance: Return on Average Tangible Equity
Performance Return on Average Tangible Equity (2) 25.0% 20.0% 17.83% 15.08%(3) 15.0% 14.39% 14.02% 13.71% (1) Peer 12.77% 10.0% 5.0% 0.0% 2014 2015 2016 2017 1Q18 (1) SNL Financial Custom Peer Group Holding Companies with $3-10 Billion of Assets (2) ) Refer to appendix for reconciliation of non-GAAP
Slide 10: Expenses: Non Interest Expense / Average Assets
Expenses Non Interest Expense / Average Assets 3.5% 3.0% 2.46% Peer(1) 2.5% 2.30% 2.17% 2.10% 2.09% 2.0% 1.5% 1.0% 0.5% 0.0% 2014 2015 2016 2017 1Q18 (1) BHCPR Peer Group 2: Bank Holding Companies with $3-10 Billion of Assets 9
Slide 11: Expenses: Efficiency Ratio
Expenses Efficiency Ratio(2) 70% Peer(1) 60% 58.67% 55.86% 54.06% 51.77% 50.35% 50% 40% 2014 2015 2016 2017 1Q18 (1) BHCPR Peer Group 2: Bank Holding Companies with $3-10 Billion of Assets 10 (2)Refer to appendix for reconciliation of Non-GAAP financial measures
Slide 12: Mergers and expansion
Mergers and expansion Integrity Bank North Shore Pittsburgh Mainline National Bank Gateway Bank acquired acquired LPO opened - acquired - March 9, 2012 August 13, 2012 March 4, 2015 November 16, 2016 Northeast Ohio Central Ohio LPO Western NY LPO S&T Bank branch Loan Production Office opened – Janua
Slide 13: Markets: Loan Growth by Market
Markets Loan Growth by Market 2012 2018 Western NY Western NY Northeast OH Northeast OH Central PA Southwestern PA Central PA Southwestern PA Central OH Central OH 12
Slide 14: Markets: S&T Operates in Regional Markets
Markets S&T Operates in 5 Regional Markets MSAs Locations Deposits(2) Loans(2) Pittsburgh Southwestern PA(1) Altoona 50 $3,854 $2,906 Johnstown Lancaster Central PA Harrisburg 8 680 834 York Other PA 117 394 Total PA 4,651 4,134 Northeast OH Akron 1 39 308 Cleveland Central OH Columbus 1 27 299 Othe
Slide 15: Asset quality: Nonperforming Loans / Total Loans
Asset quality Nonperforming Loans / Total Loans 1.00% 0.76% 0.75% 0.70% 0.50% Peer(1) 0.42% 0.37% 0.32% 0.25% 0.00% 2014 2015 2016 2017 1Q18 (1) BHCPR Peer Group 2: Bank Holding Companies with $3-10 Billion of Assets 14
Slide 16: Asset quality: Net Charge Offs / Average Loans
Asset quality Net Charge Offs / Average Loans 0.30% 0.25% 0.22% 0.20% 0.18% Peer(1) 0.10% 0.00% 0.00% (0.01)% -0.10% 2014 2015 2016 2017 1Q18 (1) BHCPR Peer Group 2: Bank Holding Companies with $3-10 Billion of Assets 15
Slide 17: Asset quality: Loan Mix
Asset quality Loan Mix As of 03.31.18 Total Portfolio Loans $5,731 Commercial Commercial Consumer $4,492 $1,239 Consumer 78% 22% Other $67 5% C&I $1,407 31% CRE Home Equity $2,761 Mortgage/ $475 61% Construction Construction 38% $697 $324 57% 8% 16 in $ Millions
Slide 18: Commercial Real Estate Diversification
Asset quality Commercial Real Estate Diversification As of 03.31.18 Total CRE $2,761 million Multi-Family 12% Offices 14% Healthcare 11% Recreational 1% Mobile Home Park 2% Convenience Stores 2% Restaurant 2% Student Rentals 3% Hotels 11% Dealerships 3% Warehouse/Storage 4% Other 6% Strip Malls 9% M
Slide 19: Commercial & Industrial Diversification
Asset quality Commercial & Industrial Diversification As of 03.31.18 Total C&I $1,407 million Manufacturing 14% Retail Trade 14% Information 1% Public Admin. 10% Agriculture 1% Arts, Enter. & Recr. 1% Food Svs. 1% Support Svs. 1% Finance/Insurance 2% Mining 2% Transportation 3% RE- Rent/Lease 10% Pr
Slide 20: Rate Sensitivity: Net Interest Margin Betas
Rate Sensitivity Net Interest Margin Betas As of 03.31.18 1Q18 vs Balance 3Q16 1Q18 3Q16 Beta 1Q18 Fed Funds 0.50% 1.53% 1.03% Net Interest Margin - FTE(1) 3.46% 3.59% 0.13% 13% Total Interest Earning Assets 3.87% 4.28% 0.41% 40% $6.5 Total Costing Liabilities 0.56% 0.95% 0.39% 38% 4.7 Securities -
Slide 21: Senior Management
Senior Management Senior Management Name Title Years in Banking Years with S&T Todd D. Brice President & CEO 32 32 Mark Kochvar Chief Financial Officer 31 25 David G. Antolik Chief Lending Officer 29 27 Ernest J. Draganza Chief Risk Officer 31 26 Patrick J. Haberfield Chief Credit Officer 30 7 David
Slide 22: Valuation: Stock Performance
Valuation Stock Performance Total Annualized Shareholder Return Includes reinvested dividends (Data as of 03.31.18) 1 YR 3 YR 5 YR 10 YR STBA 18.09% 14.90% 19.63% 5.25% S&P 600 Bank 9.15% 17.03% 16.70% 6.18% NASDAQ Bank 10.74% 17.13% 16.57% 7.10% S&P 500 14.06% 10.77% 13.28% 9.48% Source: Bloomberg
Slide 23: Performance Summary
Performance Performance Summary 1Q18 2017 Excludes 2016 2015 2014 DTA(2) Net Income (in $ thousands) $26,163 $72,968 $86,401 $71,392 $67,081 $57,910 Diluted Earnings per Share $0.75 $2.09 $2.47 $2.05 $1.98 $1.95 Dividends Declared per Share $0.22 $0.82 $0.77 $0.73 $0.68 Total Assets (in $ millions)
Slide 24: Financial Data: Income Statement
Financial Data Income Statement Excludes 1Q18 2017 DTA(1) 2016 2015 2014 Net Interest Income $56,932 $225,733 $203,259 $187,551 $148,042 Noninterest Income 13,792 55,462 54,635 51,033 46,338 Total Revenue 70,724 281,195 257,894 238,584 194,380 Noninterest Expense 36,082 147,907 143,232 136,717 117,2
Slide 25: Financial Data: Balance Sheet
Financial Data Balance Sheet 1Q18 2017 2016 2015 2014 Securities $687,650 $698,291 $693,487 $660,963 $640,273 Interest-bearing Balances 112,849 61,965 87,201 41,639 57,048 Loans, Net 5,674,850 5,709,544 5,562,437 5,014,786 3,823,805 Other 529,980 590,455 599,928 600,966 443,560 Total Assets $7,005,3
Slide 26: Financial Data: Net Interest Margin
Financial Data Net Interest Margin 1Q18 2017 2016 2015 2014 Securities - FTE 2.53% 2.48% 2.41% 2.48% 2.58% Loans - FTE 4.50% 4.32% 4.08% 4.09% 4.06% Total Interest-earning Assets - FTE 4.28% 4.09% 3.87% 3.86% 3.78% Deposits 0.80% 0.62% 0.51% 0.37% 0.36% Borrowings 1.79% 1.27% 0.86% 0.71% 0.91% Total
Slide 27: Financial Data: Loan Portfolio
Financial Data Loan Portfolio 1Q18 2017 2016 2015 2014 Commercial Commercial Real Estate $2,760,891 $2,685,994 $2,498,476 $2,166,603 $1,682,236 Commercial & Industrial 1,406,950 1,433,266 1,401,035 1,256,830 994,138 Construction 324,141 384,334 455,884 413,444 216,148 Total Commercial 4,491,982 4,50
Slide 28: Financial Data: Asset Quality
Financial Data Asset Quality 1Q18 2017 2016 2015 2014 Total Nonperforming Loans $21,335 $23,938 $42,635 $35,382 $12,457 Nonperforming Loans/Total Loans 0.37 % 0.42% 0.76% 0.70% 0.32% Nonperforming Assets/Total Loans + OREO 0.42 % 0.42% 0.77% 0.71% 0.33% Net Charge-offs (Recoveries)/Average Loans (0.
Slide 29: Financial Data: Capital
Financial Data Capital 1Q18 2017 2016 2015 2014 Leverage 9.72% 9.17% 8.98% 8.96% 9.80% Common Tier 1 – Risk-Based Capital 11.02% 10.71% 10.04% 9.77% 11.81% Tier 1 – Risk-Based Capital 11.36% 11.06% 10.39% 10.15% 12.34% Total – Risk-Based Capital 12.85% 12.55% 11.86% 11.60% 14.27% Tangible Common Equ
Slide 30: Appendix: Non-GAAP Measures
Appendix APPENDIX – Non-GAAP Measures 1Q18 2017 2016 2015 2014 Tangible shareholders' equity/tangible assets (non-GAAP) Total Shareholders’ Equity (GAAP basis) $895,407 $884,031 $841,956 $792,237 $608,389 Less: goodwill and other intangible assets (290,572) (295,347) (296,580) (298,289) (178,451) Ta
Slide 31: Appendix: Non-GAAP Measures, Efficiency Ratio
Appendix APPENDIX – Non-GAAP Measures 1Q18 2017 2016 2015 2014 Efficiency ratio (non-GAAP) Noninterest expense $36,082 $147,907 $143,232 $136,717 $117,240 Net interest income 56,932 225,733 203,259 187,551 148,042 Plus: taxable equivalent adjustment 940 7,493 7,043 6,123 5,461 Net interest income (F
Slide 32: Appendix: Non-GAAP Measures, Net Interest Margin
Appendix APPENDIX – Non-GAAP Measures 1Q18 2017 2016 2015 2014 Net Interest Margin Rate (FTE) (Non-GAAP) Total interest income $68,029 $260,642 $227,774 $203,548 $160,523 Less: interest expense (11,097) (34,909) (24,515) (15,997) (12,481) Net interest income per consolidated statements of net income
Slide 33: Appendix: Non-GAAP Measures, Returns
Appendix APPENDIX – Non-GAAP Measures 2017 2017 Return on Average Equity Return on Tangible Shareholders' Equity Net Income $72,968 Net Income $72,968 Plus: DTA re-measurement 13,433 Plus: DTA re-measurement 13,433 Adjusted net income (non-GAAP) 86,401 Adjusted net income (non-GAAP) 86,401 Average a
Slide 34: First Quarter 2018
First Quarter 2018 MEMBER FDIC