Amerant Bancorp Inc. · NYSE:AMTB
Amerant Bancorp — Mercantil Bank Holding — Investor Presentation (May 2019)
30 slides from Amerant Bancorp's investor presentation, May 21, 2019
Slide 1: Investor Presentation As of March 31, 2019
Investor Presentation As of March 31, 2019
Slide 2: Important Notices and Disclaimers
2 Important Notices and Disclaimers This presentation contains “forward-looking statements” within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, including, without limitation, future financial and operating results; costs and revenues; economic conditions general
Slide 3: Who We Are
Geographic Mix 3 Who We Are March 31, 2019 Loans Deposits • Founded in 1979 • Acquired in 1987 by MSF(1) • 80.1% Spin-off in August 2018 History • Adopted Amerant brand in October 2018 4.1% • Completed IPO in December 2018 49.7% 50.3% • MSF no longer has any stake in the 95.9% Company(2) Headquarter
Slide 4: Investment Opportunity Highlights
Investment Opportunity Highlights 4 Established Strong and Well-Positioned Significant Fee Pathway to Franchise in Diverse Deposit Loan Income Strong Attractive Portfolio Markets Base Platform Profitability • Long history with • Combination of • Loan book well- • Wealth • Recent strong reputation do
Slide 5: Experienced Management Team
Experienced Management Team 5 Frederick • Chairman since January 2019 Copeland • Director of Company and Bank from 2007 to 2018 • Former President and CEO of Far East National Bank Chairman of the Board • Former President and CEO of Aetna International, Inc. 77 years old • Former Chairman, President
Slide 6: Deep Culture of Enterprise Risk Management
6 Deep Culture of Enterprise Risk Management ü Enterprise-Wide ü ü ü Risk Governance Risk Culture Risk Appetite Strategic Planning Board of Directors Senior Management Three Lines of Defense 1 Front Line Units 2 Risk Management 3 Internal Audit • Own and manage their • Independent from front • Direc
Slide 7: Our New Brand: Meant for You
Our New Brand 7 Meant for You: A Different Kind of Bank Our new purpose We are evolving, just like you All that we do, our attitude and behaviors, aim We are renewing our commitment to you by at our ultimate goal: offering the closest, most aiming to keep growing and making possible a personal and e
Slide 8: Market Strategy
Market Strategy 8 Our strategy is to operate and expand in high-growth, diverse economies where we can build from our heritage serving the Hispanic community Target markets have: Miami-Dade MSA • Major industry sectors of trade, tourism, services, • Substantial domestic deposit manufacturing, educat
Slide 9: Growing and Diverse Markets
Growing and Diverse Markets 9 Branch Footprint Deposit Market Share Market Demographics June 30, 2018 2010 – 2019 Est. Population Change Deposits % of Market 19.80% 15 banking centers Market Branches ($mm) AMTB Share % $5,762mm Deposits 12.92% Miami-Dade, 9 $5,287 82.6 4.1 6.64% FL Broward, FL 5 351
Slide 10: Ongoing Business Transformation
Ongoing Business Transformation 10 From... To... Part of a diverse international financial group, Focused on traditional community banking with a sophisticated international customer business in the U.S. and an opportunistic base international business A number of non-core products and services No o
Slide 11: Summary of Our Strategic Plan
Summary of Our Strategic Plan 11 Building on our strengths to shape our future Domestic focus Expanding Growth in Core, Increased with an Strong Credit Business and Domestic Profitability International Culture Geographic Deposits and Returns Heritage Presence ▪ Protect and serve ▪ Exit higher-risk ▪
Slide 12: Build on Improving Financial Performance
Build on Improving Financial Performance 12 Increased Attractive Risk- Higher Net Improving Enhanced Domestic Adjusted Loan Interest Expense Profitability Deposits Profile Margin Culture Nonaccrual Domestic Net Interest Loans / Total Efficiency (2)(3) Deposits(1) Margin(2) (2)(3) ROATCE Loans(1) Rat
Slide 13: Highly Attractive Deposit Franchise
Highly Attractive Deposit Franchise 13 Commentary Deposit Mix (1)(2) March 31, 2019 NIB Jumbo Demand, Time, 13.2% • Focus on growing overall deposit base while 12.0% maintaining pricing discipline IB Demand, • AMTB has experienced substantial growth in Retail 20.9% domestic deposits Time, 28.1% • Tr
Slide 14: Strategic Shift in Loan Mix Yielding Benefits
14 Strategic Shift in Loan Mix Yielding Benefits Loan Portfolio Loan Mix by Geography March 31, 2019 December 31, 2015 March 31, 2019 Financial Institutions & Acceptances 0.5% 24.2% Consumer 1.9% 1-4 Family 4.1% 9.3% 95.9% C&I 21.6% 75.8% § Domestic § International Owner Occupied CRE 14.0% CRE 52.7%
Slide 15: Balanced CRE Loan Portfolio
Balanced CRE Loan Portfolio 15 CRE Portfolio CRE Loan Mix by Primary Market Area(1) March 31, 2019 March 31, 2019 New York City area 23.5% Greater Other FL, Houston TX, and NY/ NJ 5.0% Hospitality 15.9% 5.5% Retail 36.9% Miami-Dade, Broward, and Palm Multifamily Beach 55.6% 29.1% Highlights Industri
Slide 16: Disciplined Credit Culture
16 Disciplined Credit Culture Robust Underwriting Standards Non-Performing Assets / Assets (2)(3) • Strong credit metrics 1.50% • In 2016 and 2018, the charge-offs increase was due to: ◦ Several international commercial credits (2016) 1.00% ◦ One isolated CRE loan (1) (2018) • As of 1Q 2019, the met
Slide 17: Interest Income and Margin Trends
Interest Income and Margin Trends 17 Commentary Impact on NII from Interest Rate Change • Increase in NIM through 2018 driven by rising interest $250 3.3% rates and changes in loan portfolio composition $240 1.7% • Modest NIM expansion expected to continue 0.0% $230 • The Company continues to be ass
Slide 18: Robust Wealth Management Franchise Anchors Non-Interest Income
Robust Wealth Management Franchise 18 Anchors Non-Interest Income Wealth Management Platform 1Q 2019 Non-Interest Income Breakdown Total: $13.2 million Amerant Trust Amerant Investments § Deposits and service fees • Wealth 23.2% § • Estate Planning Brokerage, advisory, and Management 31.1% fiduciary
Slide 19: Increasing Operating Efficiency
19 Increasing Operating Efficiency Cost Initiatives Adjusted Efficiency Ratio(1)(2)(3) • Simplification of business model 84.7% and product offerings as part of Rationalization 78.0% separation from MSF of Business Lines 74.8% 74.0% 74.4% • Deemphasized international business resulting in less compl
Slide 20: ROA Expansion
20 ROA Expansion Enhanced Profitability Improving Drivers 1 Technology and Expense Saving Initiatives Target ROAA (1) Continue to rationalize expenses and improve scalable platform 35 bps increase 2 Changing Business Mix Exit from lower yielding loans and securities and redeploy into higher yielding
Slide 21: Investment Highlights
21 Investment Highlights Recent shift from preservation of capital to driving profitable growth and shareholder value Substantial and continuing insider ownership, approximately 30% Strong asset quality and domestic loan growth Focus on expanding domestic deposit base throughout our high growth U.S.
Slide 22: Appendices
Appendices
Slide 23: Appendix Summary Financial Statements
Appendix 1 23 Summary Financial Statements December 31, March 31, (in millions) 2015 2016 2017 2018 2019 Assets Total Cash & Bals Due Dep Inst $138.3 $135.0 $153.4 $85.7 $89.7 Total Securities (1) 2,055.6 2,123.2 1,777.0 1,671.2 1,635.5 Loans & Leases Held for Sale (HFS) 9.7 — 5.6 — 10.0 Total Loans
Slide 24: Appendix Summary Financial Statements (cont'd)
Appendix 1 24 Summary Financial Statements (cont’d) Years ended December 31, Three months ended (in thousands) 2015 2016 2017 2018 3/31/2019 Total Interest Income $208,199 $238,827 $273,320 $309,358 $80,307 Total Interest Expense 35,914 46,894 63,610 90,319 24,870 Net Interest Income $172,285 $191,9
Slide 25: Non-GAAP Financial Measures Reconciliations
Appendix 2 25 Non-GAAP Financial Measures Reconciliations Explanation of Certain Non-GAAP Financial Measures This Presentation contains certain adjusted financial information, and their effects on noninterest income, noninterest expense, income taxes, net income, efficiency ratios, ROA and ROE. Thes
Slide 26: Non-GAAP Financial Measures Reconciliations (cont'd)
Appendix 2 26 Non-GAAP Financial Measures Reconciliations (cont’d) (in thousands) 1Q 2019 4Q 2018 3Q 2018 2Q 2018 1Q 2018 2018 2017 Total noninterest income $ 13,156 $ 11,994 $ 12,950 $ 14,986 $ 13,945 $ 53,875 $ 71,485 Less: net gain on sale of New York building — — — — — — (10,469) Adjusted nonint
Slide 27: Non-GAAP Financial Measures Reconciliations (cont'd)
Appendix 2 27 Non-GAAP Financial Measures Reconciliations (cont’d) (in thousands) 1Q 2019 4Q 2018 3Q 2018 2Q 2018 1Q 2018 2018 2017 Total net income $ 13,071 $ 14,430 $ 11,551 $ 10,423 $ 9,429 $ 45,833 $ 43,057 Plus after-tax restructuring costs: Restructuring costs before income tax effect 933 6,39
Slide 28: Non-GAAP Financial Measures Reconciliations (cont'd)
Appendix 2 28 Non-GAAP Financial Measures Reconciliations (cont’d) 1Q 2019 4Q 2018 3Q 2018 2Q 2018 1Q 2018 2018 2017 Basic income per common share $ 0.31 $ 0.34 $ 0.27 $ 0.25 $ 0.22 $ 1.08 $ 1.01 Plus: after tax impact of restructure costs 0.02 0.12 — — — 0.12 — Plus: after tax impact of total spin-
Slide 29: Non-GAAP Financial Measures Reconciliations (cont'd)
Appendix 2 29 Non-GAAP Financial Measures Reconciliations (cont’d) (in thousands, except per share data and percentages) 1Q 2019 4Q 2018 3Q 2018 2Q 2018 1Q 2018 2018 2017 Noninterest expense / Average total assets 2.58 % 2.64 % 2.46 % 2.50 % 2.65 % 2.57 % 2.45 % Less: effect of restructuring costs (
Slide 30: Amerant - Thank you
AMERANT Thank you
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