Amerant Bancorp Inc. · NYSE:AMTB
Amerant Bancorp — Investor Presentation (December 2019)
32 slides from Amerant Bancorp's investor presentation, Dec 31, 2019
Slide 1: Investor Presentation
Investor Presentation As of December 31, 2019
Slide 2: Important Notices and Disclaimers
2 Important Notices and Disclaimers Forward-Looking Statements 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;
Slide 3: Who We Are
3 Who We Are Geographic Mix December 31, 2019 Loans Deposits • Founded in 1979 • Acquired in 1987 by MSF (1) History • 80.1% spin-off in August 2018 3.0% § Domestic • Completed IPO in December 2018 45.8% • Rebranded as Amerant in June 2019 97.0% 54.2% • MSF no longer has any stake in the Company(2)
Slide 4: Investment Opportunity Highlights
4 Investment Opportunity Highlights Established Strong and Significant Fee Pathway to Well-Positioned Franchise in Diverse Deposit Loan Income Strong Attractive Base Portfolio Platform Profitability Markets • Long history with • Combination of • Loan book well- • Wealth • Independence from strong re
Slide 5: Experienced Management Team
5 Experienced Management Team 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. • Former Chairman, President, and CEO of
Slide 6: Deep Culture of Enterprise Risk Management
6 Deep Culture of Enterprise Risk Management ü Enterprise-Wide Risk Governance ü Risk Culture ü Risk Appetite ü 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
7 Our New Brand 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
8 Market Strategy Our strategy is to operate and expand in high-growth, diverse economies where we can build from our heritage serving the Hispanic community Miami-Dade MSA Target markets have: • Major industry sectors are trade, tourism, services, manufacturing, education, and real estate • Substan
Slide 9: Growing and Diverse Markets
9 Growing and Diverse Markets Branch Footprint(1) Deposit Market Share(2) Market Demographics March 12, 2019 June 30, 2019 2010 – 2020 Est. Population Change 19 banking centers Deposits % of Market Market Branches ($mm) AMTB Share % 21.1% 13.7% Miami-Dade, FL 9 $4,793 81.6 3.6 7.0% Florida Broward,
Slide 10: Ongoing Business Transformation
10 Ongoing Business Transformation From... To... Part of a diverse international financial group, Focused on traditional community banking with a sophisticated international customer business in the U.S. and an international base business to service valued relationships A number of non-core products
Slide 11: Summary of Our Strategic Plan
11 Summary of Our Strategic Plan Building on our strengths to shape our future Domestic focus Expanding Growth in Core, Increased with an Strong Credit Business and Domestic Profitability International Culture Geographic Deposits and Returns Heritage Presence ▪ Protect and serve ▪ Exit higher-risk ▪
Slide 12: Build on Improving Financial Performance
12 Build on Improving Financial Performance Increased Attractive Risk- Higher Net Rationalizing Enhanced Domestic Adjusted Loan Interest Cost Profitability Deposits Profile Margin Structure Non-performing Domestic Net Interest Efficiency Loans(1) ROE Deposits Margin Ratio / Total Loans ($ in million
Slide 13: Investment Portfolio
13 Investment Portfolio Investment Securities Balances and Yields(1) Highlights (in millions) $23.1 $23.8 $24.0 • Effective duration increased to 3.8 years as we $85.2 $73.9 $1,500 $77.6 prepared for continued rate decline by purchasing 20-year U.S. Treasuries and collateralized mortgage obligations
Slide 14: Strategic Shift in Loan Mix Yielding Benefits
14 Strategic Shift in Loan Mix Yielding Benefits Loan Portfolio Loan Mix by Geography December 31, 2019 December 31, 2015 December 31, 2019 Financial Institutions & Acceptances 0.3% 24.2% Consumer 1.5% 1-4 Family 3.0% 9.4% 97.0% C&I 21.5% 75.8% § Domestic § International Owner Occupied CRE 51.7% Hig
Slide 15: Balanced CRE Loan Portfolio
15 Balanced CRE Loan Portfolio CRE Portfolio CRE Loan Mix by Primary Market Area(1) December 31, 2019 December 31, 2019 Greater Houston 15.4% Hospitality 6.7% New York City area 24.0% Retail 38.5% Other FL, Multifamily TX, and NY/ Miami-Dade, NJ 5.1% 27.0% Broward, and Palm Beach counties 55.5% Indu
Slide 16: Disciplined Credit Culture
16 Disciplined Credit Culture Robust Underwriting Standards Non-performing Assets(3) / Total Assets • Credit quality and reserve coverage remains strong dzf 1.50% • The increase in charge-offs was due to: ◦ Several international commercial credits (2016) ◦ One isolated CRE loan (1) (2018) 1.00% ◦ Ap
Slide 17: Highly Attractive Deposit Franchise
17 Highly Attractive Deposit Franchise Highlights Deposit Mix (1) Jumbo NIB December 31, 2019 Demand, Time, 12.7% 13.3% • Focus on developing domestic relationships as opposed to rate sensitive, non-relationship time IB Demand, deposits Retail 19.1% Total Deposits: Time, • Experienced 11.4% CAGR in
Slide 18: Wholesale Funding
18 Wholesale Funding FHLB and Other Borrowings by Maturity Advances from the Federal Home Loan Bank and Other December 31, 2019 Borrowings (in millions) Year of Interest Rate 2018 3Q19 4Q19 Maturity 2021 17.0% 2019 1.80% to 3.86% 440 195 — 2020 23.1% 2020 1.50% to 2.74% 306 325 285 2022 9.7% 2021 1.
Slide 19: Interest Income and Margin Trends
19 Interest Income and Margin Trends Highlights Impact on NII from Interest Rate Change(3) (As of December 31, 2019) • Increase in NIM in 2019 driven by improved loan portfolio mix, including the planned strategic run-off of $230 foreign FI and non-relationship SNC loans, partially 2.6% offset by an
Slide 20: Wealth Management Franchise Expansion - Key Component of Noninterest Income
20 Wealth Management Franchise Expansion - Key Component of Noninterest Income Wealth Management Platform 2019 YTD Noninterest Income Mix Total: $57.1 million Amerant Trust Amerant Investments § Deposits and service fees 29.9% • Estate Planning • Brokerage Services 43.9% § Brokerage, advisory, and f
Slide 21: Increasing Operating Efficiency
21 Increasing Operating Efficiency Cost Initiatives Efficiency Ratio • Continue simplification of 84.7% Rationalization business model and product 78.0% 78.8% 77.5% offerings as part of spin-off of Business Lines 73.8% • Streamlined international business resulting in less complexity and reduced cos
Slide 22: Investment Highlights
22 Investment Highlights Starting second year of shifting from preservation of capital to driving profitable growth and shareholder value Diversification of revenue from a greater share of wallet strategy and an attractive wealth management platform that is being refocused and cross-sold to domestic
Slide 23: Appendices
Appendices
Slide 24: Summary Financial Statements
24 Appendix 1 Summary Financial Statements December 31, (in millions) 2015 2016 2017 2018 2019 Assets Cash and cash equivalents $138.3 $135.0 $153.4 $85.7 $121.3 Total securities (1) 2,055.6 2,123.2 1,777.0 1,671.2 1,666.5 Loans held for sale (HFS) 9.7 — 5.6 — — Loans, gross (excl HFS) 5,623.2 5,764
Slide 25: Summary Financial Statements (cont'd)
25 Appendix 1 Summary Financial Statements (cont’d) Years ended December 31, (in thousands) 2015 2016 2017 2018 2019 Total interest income $208,199 $238,827 $273,320 $309,358 $312,974 Total interest expense 35,914 46,894 63,610 90,319 99,886 Net interest income $172,285 $191,933 $209,710 $219,039 $1
Slide 26: Non-GAAP Financial Measures Reconciliations
26 Appendix 2 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 and c
Slide 27: Non-GAAP Financial Measures Reconciliations (cont'd)
Appendix 2 27 Non-GAAP Financial Measures Reconciliations (cont’d) (in thousands) 2019 2018 2017 Total noninterest income $ 57,110 $ 53,875 $ 71,485 Less: gain on sale of vacant Beacon land (2,795) — — Less: net gain on sale of New York building — — (10,469) Adjusted noninterest income $ 54,315 $ 53
Slide 28: Non-GAAP Financial Measures Reconciliations (cont'd)
28 Appendix 2 Non-GAAP Financial Measures Reconciliations (cont’d) (in thousands) 2019 2018 2017 Net income $ 51,334 $ 45,833 $ 43,057 Plus after-tax restructuring costs: Restructuring costs before income tax effect 5,046 6,395 — Income tax effect (1,001) (1,303) — Total after-tax restructuring cost
Slide 29: Non-GAAP Financial Measures Reconciliations (cont'd)
Appendix 2 29 Non-GAAP Financial Measures Reconciliations (cont’d) 2019 2018 2017 Basic earnings per share $ 1.21 $ 1.08 $ 1.01 Plus: after tax impact of restructuring costs 0.09 0.12 — Plus: after tax impact of total spin-off costs — 0.16 0.07 Plus: effect of lower rate under the 2017 Tax Act — — 0
Slide 30: Non-GAAP Financial Measures Reconciliations (cont'd)
30 Appendix 2 Non-GAAP Financial Measures Reconciliations (cont’d) (in thousands, except per share data and percentages) 2019 2018 2017 Efficiency ratio 77.64 % 78.77 % 73.84 % Less: impact of restructuring costs (2.43)% (2.34)% — % Less: impact of total spin-off costs — % (2.44)% (1.86)% Plus: afte
Slide 31: Non-GAAP Financial Measures Reconciliations (cont'd)
31 Appendix 2 Non-GAAP Financial Measures Reconciliations (cont’d) (1) Expenses incurred for actions designed to implement the Company’s strategy as a new independent company. These actions include, but are not limited to, reductions in workforce, streamlining operational processes, rolling out the
Slide 32: Thank you
AMERANT Thank you
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