Slide 1: First Quarter 2025 Earnings Conference Call
1 First Quarter 2025 Earnings Conference Call April 22, 2025
Slide 2: Safe Harbor Statement
1 Statements in this presentation which are not historical facts are “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995. The
Slide 3: Use of Non-US GAAP Financial Measures
2 This presentation contains financial information and performance measures determined by methods other than those in accordance with accounting principles generally accepted in the United States of America (“US GAAP”). Management uses these “non-US GAAP” financial measures in its analysis of People
Slide 4: First Quarter 2025 Highlights
3 • Annualized loan growth of over 4% • Key credit quality metrics improved • Deposit balances increased 2%, driven by higher money markets and governmental balances, while also reducing brokered CDs by $96 million • Book value per share grew 2%, while tangible book value per share increased 4%, to
Slide 5: Loans
4 Loans Balances by Segment (As of Most Recent Quarter-End) 29% 12% 23% 10% 21% 5% Consumer loans Owner occupied commercial real estate Non-owner occupied commercial real estate Specialty finance Commercial and industrial Construction Loan Balances and Yields (Dollars in billions) $1.76 $1.69 $1.59
Slide 6: North Star Leasing
5 North Star Leasing 1.54% 1.65% 1.32% 4.08% 6.95% 13.35% 11.97% 14.43% 14.49% 14.69% 14.35% 13.99% 14.24% 13.80% Net Charge-Off Rate Net Yield 2022 2023 1Q 2024 2Q 2024 3Q 2024 4Q 2024 1Q 2025 – While our North Star Leasing business has experienced higher net charge-off levels, the risk-adjusted re
Slide 7: Asset Quality Metrics
6 Asset Quality Metrics 4.14% 3.79% 3.79% 3.80% 3.53% 2.38% 1.90% 2.12% 2.03% 1.93% 1.05% 1.05% 1.06% 1.00% 1.01% 0.50% 0.53% 0.76% 0.53% 0.50% Criticized loans as a % of total loans Classified loans as a % of total loans Allowance for credit losses as a % of total loans Nonperforming assets as a %
Slide 8: Net Interest Income
7 Net interest income declined 1% compared to the linked quarter, and was attributable to lower accretion income – Accretion income declined $1.4 million – Accretion income added 17 basis points to net interest margin, compared to 23 basis points for the linked quarter – Excluding accretion income,
Slide 9: Non-Interest Income
8 Non-interest income, excluding gains and losses, grew 2% compared to the linked quarter – Performance-based insurance commissions that are recognized annually in the first quarter of each year totaled $1.5 million – This growth was partially offset by lower commercial loan swap fees, deposit accou
Slide 10: Non-Interest Expense
9 – Non-interest expense was relatively flat compared to the linked quarter – Impacted by one-time costs recognized in the first quarter of each year – Stock-based compensation expense related to the annual forfeiture rate true-up on stock vested during the first quarter, along with up-front expense
Slide 11: Deposits
10 Deposit Balances by Segment (As of Most Recent Quarter-End) 20% 14% 25% 12% 11% 12% 6% Non-interest-bearing deposits Interest-bearing demand accounts Retail certificates of deposit Money market deposit accounts Governmental deposit accounts Savings accounts Brokered deposits Deposit Balances and
Slide 12: Capital Metrics
11 Capital Metrics 11.69% 11.74% 11.80% 11.95% 12.09% 12.14% 12.18% 12.24% 12.39% 12.53% 13.40% 13.44% 13.42% 13.58% 13.78% 9.16% 9.29% 9.59% 9.73% 9.81% 7.37% 7.61% 8.25% 8.01% 8.34% Common equity tier 1 capital ratio Tier 1 risk-based capital ratio Total risk-based capital ratio Leverage ratio Tan
Slide 13: 2025 Expectations
12 A high level look at our expectations for 2025: Operating Leverage – Generating positive operating leverage for 2025, compared to 2024 Net Interest Income – Assuming a 25 basis point rate reduction by the Federal Reserve in mid-2025, and another 25 basis point reduction during the fourth quarter,