Stellar Bancorp, Inc. · NYSE:STEL
Stellar Bancorp — CBTX — Q1 2020 Earnings Presentation
25 slides from Stellar Bancorp's earnings presentation, Apr 30, 2020
Slide 1: CBTX, Inc. Investor Presentation First Quarter 2020
CBTX, Inc. Investor Presentation First Quarter 2020 NASDAQ: CBTX
Slide 2: Safe Harbor Statement and Non-GAAP Financial Measures
2 SAFE HARBOR STATEMENT AND NON-GAAP FINANCIAL MEASURES NON-GAAP FINANCIAL MEASURES This presentation contains certain non-GAAP (generally accepted accounting principles) financial measures, including tangible equity, tangible assets, tangible book value per share, tangible equity to tangible assets
Slide 3: COVID-19 Response
3 COVID-19 RESPONSE ▪ Participation in SBA’s Paycheck Protection Program ▪ Processed 1,378 loans and funded over $287M with average loan size of $208,000 in first phase(1) ▪ Offering deferrals & fee waivers and suspended foreclosures, evictions & auto repossessions ▪ Working with our clients on a ca
Slide 4: Financial Highlights
4 FINANCIAL HIGHLIGHTS (1) See Appendix for reconciliation of non-GAAP financial measures. (2) Pre-provision net revenue is net income, with the provision for credit losses and income tax expense added back. (3) Annualized. (4) Efficiency ratio is calculated by dividing noninterest expense by the su
Slide 5: Financial Highlights (Continued)
5 FINANCIAL HIGHLIGHTS (Continued) (1) See Appendix for reconciliation of non-GAAP financial measures. (2) Annualized. ` Q1 2020 Q4 2019 Q3 2019 Q1 2020 vs Q4 2019 Q1 2020 vs Q3 2019 Capital Ratios Total Shareholders' Equity to Total Assets 15.67% 15.40% 15.31% 0.27% 0.36% Tangible Equity to Tangibl
Slide 6: Capital and Liquidity; Revenue Growth
The Bank Built or Business CAPITAL AND LIQUIDITY 6 REVENUE GROWH • Stable net interest margin (NIM) • Asset sensitive, with 54% variable rate loans as of March 31, 2020 • Increasing revenue and improving efficiency ratio (2) Capital Activity • Total shareholders’ equity of $537 million as of March 3
Slide 7: Deposits
The Bank Built or Business DEPOSITS 7 Stable Core Deposit Base (1) • Proven ability to generate low-cost core deposits(2) to fund loan growth • 95% loan to deposit ratio as of March 31, 2020 • 43% noninterest-bearing demand deposits at March 31, 2020 • 92% core deposits(2) with minimal reliance on t
Slide 8: Loan Portfolio Composition
The Bank Built or Business 8 Loan Portfolio Composition(1) (1) Figures as of year end 12/31. Q1 2020 as of 3/31/2020. (2) Commercial loans defined as total loans less 1-4 family residential, consumer, agriculture and other loans. LOAN PORTFOLIO • At March 31, 2020, 7% of total loans were related to
Slide 9: Commercial Loans
The Bank Built or Business COMMERCIAL LOANS 9 • INDUSTRIAL CONSTRUCTION/EQUIPMENT RENTAL Provide operating lines of credit, fixed asset financing and real estate loans to numerous industrial companies involved in the construction, modification, support and maintenance of petrochemical plants • PROFE
Slide 10: Net Charge-Offs
The Bank Built or Business NET CHARGE-OFFS 10 • CHIEF CREDIT OFFICER WITH 40 YEARS OF EXPERIENCE Seasoned Regional Credit Officers located in Houston and Beaumont • CENTRALIZED UNDERWRITING, TIERED APPROVAL REUIREMENT BASED ON AGGREGATED REALTIONSHIP SIZE Officer credit authority, credit executive c
Slide 11: Nonperforming Assets
The Bank Built or Business NONPERFORMING ASSETS 11 • CHIEF CREDIT OFFICER WITH 40 YEARS OF EXPERIENCE Seasoned Regional Credit Officers located in Houston and Beaumont • CENTRALIZED UNDERWRITING, TIERED APPROVAL REUIREMENT BASED ON AGGREGATED REALTIONSHIP SIZE Officer credit authority, credit execut
Slide 12: Construction and Development Loans
The Bank Built or Business CONSTRUCTION AND DEVELOPMENT LOANS 12 (1) Total capital of CommunityBank of Texas, N.A., the wholly-owned subsidiary of the Company. (2) Average of full commitment amount to appraised value of collateral. (% Capital) (1) Commitment Average Commitment to Value (2) Commercia
Slide 13: Oil and Gas Loans
The Bank Built or Business OIL AND GAS LOANS 13 • At March 31, 2020, 7% of total loans were directly or indirectly related to oil and gas. • DIRECT - Loans to an entity with more than 50% of its revenue related to the well-head, oil in the ground or extracting oil or gas. Any activity, product or se
Slide 14: Oil and Gas Loans Components
The Bank Built or Business OIL AND GAS LOANS COMPONENTS 14 % Lines of Credit 78 $ 40.4% Secured by Real Estate 43 22.3% Equipment 40 20.7% Production Secured by Mineral Rights 32 16.6% Total 193 $ 100.0% Components 3/31/2020 (M)
Slide 15: Working with Clients & the PPP
15 WORKING WITH CLIENTS & THE PPP (1) Deferral information through 4/21/2020. Percentage based on total loans, excluding loans held for sale, as of March 31, 2020. Deferral Information Number of loans Prinicipal Amount (M) Percentage of Total Loans (1) Commercial and Industrial 202 76 $ 2.8% Real Es
Slide 16: Deferral Information
16 DEFERRAL INFORMATION (1) Deferral information through 4/21/2020 and includes both executed deferrals and approved deferrals. Deferrals Number of loans Prinicipal st 3/31/2020 (000) Deferred Payments at 3/31/2020 (000) Deferred Payments 4/1 - 4/21/2020 (000) Total Approved Deferrals (000) % of Tot
Slide 17: COVID-19 At Risk Loans
17 COVID-19 AT RISK LOANS (1) Represents total principal balance for specific loan type as of March 31, 2020. (2) Represents the principal balance of deferrals approved related to the specific loan type. (3) Deferral information through 4/21/2020. Percentage based on specific loan type as of March 3
Slide 18: Allowance for Credit Losses - Loans
The Bank Built or Business ALLOWANCE FOR CREDIT LOSSES - LOANS 18 • CHIEF CREDIT OFFICER WITH 40 YEARS OF EXPERIENCE Seasoned Regional Credit Officers located in Houston and Beaumont • CENTRALIZED UNDERWRITING, TIERED APPROVAL REUIREMENT BASED ON AGGREGATED REALTIONSHIP SIZE Officer credit authority
Slide 19: ACL - Unfunded Commitments
The Bank Built or Business 19 • CHIEF CREDIT OFFICER WITH 40 YEARS OF EXPERIENCE Seasoned Regional Credit Officers located in Houston and Beaumont • CENTRALIZED UNDERWRITING, TIERED APPROVAL REUIREMENT BASED ON AGGREGATED REALTIONSHIP SIZE Officer credit authority, credit executive committee, and di
Slide 20: Revenue and Efficiency
The Bank Built or Business REVENUE AND EFFICIENCY 20 REVENUE • Stable net interest margin (NIM) • Asset sensitive, with 54% variable rate loans as of March 31, 2020 • Approximately 71% of variable rate loan portfolio had floors Revenue and NIM (1) Efficiency (1)(2) EFFICIENCY EFFORTS • Investments i
Slide 21: Here to Serve: CommunityBank of Texas
21 At CommunityBank of Texas, we’re committed to building strong honest relationships. We strive to keep our clients’ and partners’ needs at the forefront of everything we do. And we measure our success by the success we help create for them. OUR VISION Here to Serve. OUR POSITIONING To experienced
Slide 22: Appendix
APPENDIX
Slide 23: Non-GAAP Reconciliation
23 NON-GAAP RECONCILIATION Our management uses certain non-GAAP (generally accepted accounting principles) financial measures to evaluate performance. We have included in this presentation information related these non-GAAP financial measures for the applicable periods presented. The table below rec
Slide 24: Non-GAAP Reconciliation
24 NON-GAAP RECONCILIATION Our management uses certain non-GAAP (generally accepted accounting principles) financial measures to evaluate performance. We have included in this presentation information related these non-GAAP financial measures for the applicable periods presented. The table below rec
Slide 25: Non-GAAP Reconciliation
25 NON-GAAP RECONCILIATION Our management uses certain non-GAAP (generally accepted accounting principles) financial measures to evaluate performance. We have included in this presentation information related these non-GAAP financial measures for the applicable periods presented. The table below rec