Laurentian Bank Of Canada · TSX:LB
Laurentian Bank Of Canada — Q2 2024 Earnings Presentation
24 slides from Laurentian Bank Of Canada's earnings presentation, May 31, 2024
Slide 1: Investor Presentation Second Quarter 2024
Investor Presentation Second Quarter 2024 May 31, 2024
Slide 2: Forward-Looking Statements and Non-GAAP Financial Measures
Forward-Looking Statements and Non-GAAP Financial Measures Caution Regarding Forward-Looking Statements From time to time, Laurentian Bank of Canada and, as applicable its subsidiaries (collectively referred to as the Bank) will make written or oral Any forward-looking statements contained herein or
Slide 3: Introduction & Strategic Overview
Éric Provost President & Chief Executive Officer Introduction & Strategic Overview
Slide 4: Introduction | Q2/24 Results Highlights
Introduction | Q2/24 Results Adjusted Net Income(1) $40.5MM Reported Net Income -$117.5MM Highlights Adjusted EPS(2) $0.90 Reported EPS -$2.71 • Reported results include $197MM of Adjusted Efficiency Ratio(2) 73.8% impairment & restructuring charges Reported Efficiency Ratio(3) 152.9% • Stable Adjus
Slide 5: Introduction | Impairment and Restructuring Charges
Introduction | Impairment and Restructuring Charges Pre-Tax After-Tax Impact CET1 Q2/24 ($MM)(1)(2) Impact Impact ($ / Share) impact Goodwill $84 $73 $1.66 Nil Intangibles 66 49 1.12 -1 Premises & Equipment 6 4 0.10 -2 Personal & Commercial Banking Impairment 156 126 2.88 -3 AIRB(3) Impairment 23 17
Slide 6: Introduction | Our Path Forward
Introduction | Our Path Forward We will succeed by focusing on the execution of our strategy across the Bank Personal & Commercial Banking Segment Capital Markets Segment Key Focus Areas Compete where we have Efficiency and Drive accountability for Harness the power of an edge and market Simplificat
Slide 7: Financial Review
Yvan Deschamps Executive Vice President & Chief Financial Officer Financial Review
Slide 8: Q2/24 Financial Results
Financial Review | Q2/24 Financial Results Reported ($MM) Q2/24 Y/Y Q/Q Y/Y Highlights Total revenue $ 252.6 -2% -2% • Total revenue decreased by $4.6MM, mostly due to lower net interest Provision for credit losses (PCL) $ 17.9 +11% +6% income from lower loan volumes Non-interest expenses (NIE) $ 38
Slide 9: Net Interest Income and Net Interest Margin
Financial Review | Net Interest Income and Net Interest Margin Net Interest Income and Margin ($MM, %) Key Assets ($B) Q2/24 Y/Y Q/Q Liquid assets(1) $ 11.0 -4% +9% 1.80% 1.84% 1.76% 1.80% 1.80% Personal loans $ 2.3 -21% -5% Residential mortgage loans $ 16.8 +2% -1% Commercial loans(2) $ 17.2 -8% -1
Slide 10: Optimizing Funding Structure and Costs
Financial Review | Optimizing Funding Structure and Costs Funding ($B)(1)(2) Y/Y Highlights Total funding decreased by $1.5B • Deposits were down $1.9B • This was partially offset by a $0.5B increase of cost-efficient 42.3 41.1 40.8 long-term debt related to securitization activities 2.8 2.9 2.8 Sha
Slide 11: Other Income
Financial Review | Other Income Other Income ($MM)(1) Q2/24 Y/Y Q/Q Y/Y Highlights • Other income was unchanged Lending fees $ 13.3 -21% -6% • Higher income from financial instruments offset by lower Income from mutual funds $ 10.1 -8% +1% lending fees due to tempered commercial real estate activity
Slide 12: Non-Interest Expenses (NIE)
Financial Review | Non-Interest Expenses (NIE) NIE ($MM) Q2/24 Y/Y Q/Q Y/Y Highlights • Reported NIE increased by $203.9MM and include $196.8MM of Salaries and employee benefits $ 99.5 -1% -3% impairment and restructuring charges in Q2 Premises and technology $ 50.1 +3% -4% • Adjusted NIE increased
Slide 13: Strong Capital Position
Financial Review | Strong Capital Position Common Equity Tier 1 Capital Ratio (CET1)(1) Risk-Weighted Assets (RWA) ($B)(1) 10.4% 10.2% 9.9% 9.8% 23.8 22.7 22.6 21.9 9.3% 21.6 Q2/23 Q3/23 Q4/23 Q1/24 Q2/24 Q2/23 Q3/23 Q4/23 Q1/24 Q2/24 Evolution of the CET1 Ratio (%)(2) Y/Y Highlights • CET1 ratio up
Slide 14: Strong and Diversified Commercial Loan Portfolio
Financial Review | Strong and Diversified Commercial Loan Portfolio Commercial Loan Portfolio ($B)(1)(2) Pan-Canadian Portfolio and U.S. Presence (as at April 30, 2024) 18.6 17.3 17.2 Commercial Lending Quebec 4.8 Inventory financing 4.2 4.3 24% Ontario 1.6 Equipment financing 1.6 1.7 39% Alberta &
Slide 15: Diversified Inventory Financing Portfolio
Financial Review | Diversified Inventory Financing Portfolio Inventory Finance Overview Inventory Finance Main Product Lines (as at April 30, 2024) • 6,000+ dealers in the U.S. and Canada Marine 17% Recreational Vehicle • $700,000 average dealer line utilization 7% 43% Trailer 12% Manufactured Housi
Slide 16: Strong Commercial Real Estate Portfolio
Financial Review | Strong Commercial Real Estate Portfolio Commercial Real Estate Portfolio (as at April 30, 2024) Portfolio Overview • >67% of our portfolio is residential: 54% Multi- Insured Term Loans - Multi- Residential and 13% Condos Residential 9% • LTV on uninsured multi-residential Conventi
Slide 17: High Quality Residential Mortgage Loan Portfolio
Financial Review | High Quality Residential Mortgage Loan Portfolio Insured vs Uninsured Pan-Canadian Portfolio (as at April 30, 2024) 12% 5% 13% 13% 10% Quebec 31% 29% 28% Alt-A 33% Ontario Conventional 15% Alberta & Prairies British Columbia 57% 58% 59% Prime insured Atlantic Provinces 37% Q2/23 Q
Slide 18: Allowances for Credit Losses
Financial Review | Allowances for Credit Losses Allowances for Credit Losses (ACL) ($MM) Y/Y Highlights • ACL increased by $13.6MM, mainly due to higher provisions on 217.1 214.8 218.5 225.2 commercial and personal loans due to credit migration, partly offset by 211.6 55.1 71.4 write-offs in the com
Slide 19: Provision for Credit Losses
Financial Review | Provision for Credit Losses Provision for Credit Losses (PCL) ($MM) Y/Y Highlights 17.9 • PCL increased by $1.7MM as a result of credit migration in commercial loans with higher provisions on impaired loans, partly offset by release on 16.2 16.7 16.9 13.3 performing loans 4.1 28.2
Slide 20: Impaired Loans
Financial Review | Impaired Loans Gross Impaired Loans ($MM, bps) Net Impaired Loans ($MM, bps) 84 67 64 62 303.6 55 52 49 13.6 46 244.5 42.0 34 38 232.2 228.0 202.1 15.4 9.0 184.1 18.9 39.1 189.4 20.2 41.9 169.3 39.9 22.3 141.4 10.3 40.4 129.6 11.8 37.2 35.4 12.4 39.8 248.0 16.7 190.0 38.4 167.2 33
Slide 21: Appendices
si Appendices
Slide 22: Appendices | Adjusting Items
Appendices | Adjusting Items Q2/24 Q1/24 Q2/23 In $MM(1) Pre-Tax After-Tax Impact Pre-Tax After-Tax Impact Pre-Tax After-Tax Impact Impact Impact ($ / Share) Impact Impact ($ / Share) Impact Impact ($ / Share) P&C Banking impairment charges $155.9 $125.6 $2.87 — — — — — — Restructuring and other imp
Slide 23: Appendices | Non-GAAP Financial Measures
Appendices | Non-GAAP Financial Measures In $MM(1) Q2/24 Q1/24 Q2/23 Income (loss) before income taxes -$151.7 $43.6 $58.5 Provision for credit losses 17.9 16.9 16.2 Pre-tax pre-provision (PTPP) income -133.7 60.5 74.7 (loss) Pre-tax impact of adjusting items(2) 200.0 9.3 3.2 Adjusted PTPP income (l
Slide 24: Investor Relations Contact
Investor Relations Contact Raphael Ambeault Head, Investor Relations (514) 601-0944 Raphael.Ambeault@laurentianbank.ca www.laurentianbank.ca/en/about-us/investor-relations
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