Amalgamated Financial Corp. · NASDAQ:AMAL
Amalgamated Financial — Investor Day (December 2024)
33 slides from Amalgamated Financial's investor day presentation, Dec 3, 2024
Slide 1: Amalgamated Financial Corp. 2024 Investor Day Presentation
1 Amalgamated Financial Corp. 2024 Investor Day Presentation December 3, 2024
Slide 2: Safe Harbor Statements
2 Safe Harbor Statements FORWARD-LOOKING STATEMENTS Statements included in this presentation that are not historical in nature are intended to be, and are hereby identified as, forward-looking statements within the meaning of the Private Securities Litigation Reform Act, Section 21E of the Securitie
Slide 3: Agenda
3 Agenda Time Module Presenter 9:00am - 9:05am Welcome & Overview of the Day Jason Darby, SEVP, Chef Financial Officer 9:05am - 9:15am Introductory Remarks - Amalgamated's Mission Priscilla Sims Brown, President & CEO 9:15am - 10:15am Amalgamated's Sustainable Lending Franchise Fireside Chat and Q&A
Slide 4: Welcome and Overview
Welcome and Overview amalgamated FINANCIAL CORP.
Slide 5: Key Themes
5 Key Themes Established Segments Across our Franchise • Considerable target market size across the U.S. • Led by “been there, done that” team • Stable, super-core customer base with average relationship length of ~17 years Asset Remix and Emphasis on Profitability • Balance sheet fortification thro
Slide 6: Our Four Strategic Framework Pillars
6 Our Four Strategic Framework Pillars
Slide 7: Focus Is on 6 Mission-Based Customer Segments
7 LABOR UNIONS • 30,000+ Labor Organizations • 14.6 million Americans • International, National and Local SUSTAINABILITY • Environmental action organizations • Sustainable businesses • Clean energy companies PHILANTHROPIES • $350 billion in assets from progressive philanthropies • 1,300 private foun
Slide 8: Featured Membership, Awards, and Recognition
8 Featured Membership, Awards, and Recognition We are committed to collaborating with groups and organizations that share our values. We believe these partnerships not only bring rigor and structure to addressing society’s greatest challenges but are critical to our mission and values. Amalgamated B
Slide 9: Sustainable Lending
Sustainable Lending amalgamated
Slide 10: Demand For Energy Generation is Growing
10 Demand For Energy Generation is Growing 35.6 11 5.3 2.7 2.5 2.2 2 1.8 1.7 1.5 Solar Batteries Wind TX CA AZ IN NY FL NM IL VA OH 2024 2023 2022 2021 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 0 10 20 30 40 TEXAS LEADS THE COUNTRY IN PLANNED CLEAN ENERGY CAPACITY1 (GW) SOLAR IS ON TRACK FOR A
Slide 11: Sustainability & Renewable Energy Lending
11 9.9% CAGR1 TOTAL LOANS + PACE ($bn) 3.9 3.9 5.0 5.5 5.7 3.4 3.3 4.1 4.3 4.50.4 0.6 0.9 1.1 1.2 Loans PACE 2020 2021 2022 2023 3Q24 > 7.3% CAGR1 (Loans) Sustainability & Renewable Energy Lending Amalgamated's Role in an Expanding Market 33 571 187 4411 212 Housing Climate Protection Community Empo
Slide 12: Fireside Chat - Sustainable Lending
12 IVAN FRISHBERG Chief Sustainability Officer Fireside Chat - Sustainable Lending Bill Peterson Senior Lending Officer & Director of Climate Finance • 35 years in commercial lending and credit administration • Pioneer of sustainable banking at New Resource Bank • 12+ years financing energy efficien
Slide 13: Labor Banking
Labor Banking gamer ‘CORP.
Slide 14: Total US Labor Market
14 Total US Labor Market $44 Billion in total Labor-Related target customer assets across the U.S. Over 30,000 Labor Organizations and an additional 2,700+ Multi- Employer Pension Plans represent significant available market share
Slide 15: Labor Banking: Heritage & Mission
15 Labor Banking: Heritage & Mission 2.13 1.46 1.19 1.26 0.78 0.47 0.54 CML - Labor CML- Social/Philanthropy CML - Political CML - NFP Consumer CML - Climate/Sustainability CML - Other(3) TOTAL CORE DEPOSITS BY IMPACT SEGMENT ($bn) $7.8bn GEOGRAPHIC FOOTPRINT OF AMALGAMATED LABOR BOOK 1.25 1.37 1.49
Slide 16: Fireside Chat - Labor
16 Fireside Chat - Labor Terri Carmichael Jackson Executive Director of the Women's National Basketball Players Association • 8+ years of experience leading WNBPA board relations, group licensing, collective bargaining, and all other labor matters • Member of University of Miami Law School Entertain
Slide 17: Political Banking
Political Banking © FINANCIAL CORP.
Slide 18: Political Spending Reaching New Heights
18 Political Spending Reaching New Heights 15.8 8.9 15.2 5.7 6.5 3.8 6.3 3.6 5.2 2.9 4.1 2.2 3.1 1.6 Congressional Elections Presidential Elections 2024 2022 2020 2018 2016 2014 2012 2010 2008 2006 2004 2002 2000 1998 TOTAL COST OF ELECTIONS (1998 - 2024) ($bn) 1. Source: Associated Press, New York
Slide 19: Political Deposits and Differentiation & Expertise
19 POLITICAL DEPOSITS2 ($bn) 0.2 0.3 0.4 0.5 0.6 0.8 1.1 1.2 0.6 0.7 0.8 1.0 1.0 1.1 1.3 1.2 0.6 0.7 0.8 1.0 1.2 1.4 1.7 2.0 1.1 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 11/22 High deposit points reflected in the quarter
Slide 20: Fireside Chat - Political
20 Fireside Chat - Political Molly Culhane Mid-Atlantic Regional Director & National Director of Political Banking Chris Koob Principal, MBA Consulting Group • Molly oversees all political deposits, as well as the Non-profit/ Philanthropy, Sustainability and Union sectors in Mid-Atlantic region. • F
Slide 21: Financial Performance Review
21 Financial Performance Review
Slide 22: Did what we said we would do: 2021-2024
22 $28.0mm Core Net Income1,2,3 $0.91 Core EPS1,2,3 $1.58bn Deposit Growth4 8.63% Leverage Ratio $72.1mm Net Interest Income 3.51% Net Interest Margin '21-24 - Did what we said we would do... 2Q21 3Q24 2Q21 3Q24 26.8% 2Q21 3Q242Q21 3Q24 2Q21 3Q24 175.2% 2Q21 3Q24 76bps8.8% 71.7% 1 GAAP Net Income an
Slide 23: Comparison of Q3 2024 to Q2 2024 for Reporting Banks
23 Comparison of Q3 2024 to Q2 2024 for Reporting Banks Summary Comparison for 200 Banks that have Reported Q3 2024 Financial Data1 Balance Sheet Information Key Profitability Items PEERS AMAL PEERS AMAL Metric Q2 2024 Q3 2024 QoQ Δ (bps) Q2 2024 Q3 2024 QoQ Δ (bps) Q2 2024 Q3 2024 QoQ Δ (bps) Q2 20
Slide 24: Finance Strategy - next 12-24 months
24 PROFITABILITY AS NORTH STAR • Flexible positive operating leverage • Diversify revenue mix — 85/15 • Invest in technology and revenue production • Recycle expense base UNASSAILABLE CAPITAL RATIOS • 8.5% as new Tier 1 Leverage baseline • Maintain top tier risk-based capital ratio • Comfortably hur
Slide 25: Optimism for year-end and 2025
25 Optimism for year-end and 2025 Margin DepositsLoans Capital • Margin at inflection point in Q3 / favorable Q4 • Reasonable expansion in 2025 • Industry leading DDA/IBA mix • YTD non-political segment growth outperformed • Political banking should be brisk for House and Senate 2026 • Exception pri
Slide 26: Appendix
Appendix fax » amalgamated
Slide 27: Impact Segment Definitions
27 LOAN TYPES INCLUDED WITHIN EACH IMPACT SEGMENT Impact Segment Definitions Climate Protection • Renewable Energy • Energy Efficiency • Energy Storage Community Empowerment • Non-Profits • CDFI's • Labor Unions • Political Organizations Health & Wellness • Medical Facilities • Rehabilitation Center
Slide 28: Key Financial Trends Through 3Q24
28 Ending Deposits + Brokered CDs 84.9 73.3 130.7 142.8 154.9 2020 2021 2022 2023 2024 YTD Trends KEY FINANCIAL TRENDS THROUGH 3Q24 ($bn) 9.9% CAGR1 9.9% CAGR1 18.9% CAGR1 NPA / Total Assets Loans + PACE 5.3 6.4 6.6 7.1 7.6 5.3 6.4 6.5 6.8 7.5 — — 0.1 0.2 0.1 2020 2021 2022 2023 3Q24 1.38% 0.77% 0.4
Slide 29: 3Q24 Highlights
29 $28.0mm Core Net Income1,2 $0.91 Core EPS1,2 $196.9mm Deposit Growth3 8.63% Leverage Ratio $72.1mm Net Interest Income 3.51% Net Interest Margin 3Q24 Highlights 2Q24 3Q24 2Q24 3Q24 2.7% 2Q24 3Q242Q24 3Q24 2Q24 3Q24 6.8% 2Q24 3Q24 5 bps 2.5% 4.2% 1 GAAP Net Income and GAAP EPS for 3Q24 are $27.9 m
Slide 30: Performance Tracking
30 1.17% 1.10% 1.27% 1.27% 1.33% 3Q23 4Q23 1Q24 2Q24 3Q24 7.89% 8.07% 8.29% 8.42% 8.63% 12.63% 12.98% 13.68% 13.48% 13.82% Leverage Ratio CET1 3Q23 4Q23 1Q24 2Q24 3Q24 17.43 18.74 19.73 20.61 22.29 3Q23 4Q23 1Q24 2Q24 3Q24 17.16% 15.77% 17.14% 16.93% 16.66% 3Q23 4Q23 1Q24 2Q24 3Q24 CORE ROAAPER-SHAR
Slide 31: Loan Portfolio Maturity Timeline
31 $0.45 $0.66 $0.78 $0.72 $0.20 $1.80 C&I Multifamily Commercial Real Estate Construction & Land Residential Real Estate Consumer and other 12 mos or less 1-3 years 3-5 years 5-10 years 10-15 years over 15 years Margin Expansion Potential LOAN PORTFOLIO MATURITY TIMELINE ($ in billions) 1 For more
Slide 32: Reconciliation of Non-GAAP Financials
32 Reconciliation of Non-GAAP Financials As of and for the As of and for the Three Months Ended Nine Months Ended (in thousands) September 30, 2024 June 30, 2024 September 30, 2023 September 30, 2024 September 30, 2023 Core operating revenue Net Interest Income (GAAP) $ 72,107 $ 69,192 $ 63,728 $ 20
Slide 33: Reconciliation of Non-GAAP Financials
33 Reconciliation of Non-GAAP Financials As of and for the As of and for the Three Months Ended Nine Months Ended (in thousands) September 30, 2024 June 30, 2024 September 30, 2023 September 30, 2024 September 30, 2023 Tangible common equity Stockholders' equity (GAAP) $ 698,332 $ 646,112 $ 546,291