Wintrust Financial Corporation · NASDAQ:WTFC
Wintrust Financial — Q3 2022 Earnings Presentation
23 slides from Wintrust Financial's earnings presentation, Oct 19, 2022
Slide 1: Earnings Release Presentation Q3 2022
Wintrust Financial Corporation Earnings Release Presentation Q3 2022
Slide 2: Forward-Looking Statements
Forward-Looking Statements This document contains forward-looking statements within the meaning of federal securities laws. Forward-looking information can be identified through the use of words such as “intend,” “plan,” “project,” “expect,” “anticipate,” “believe,” “estimate,” “contemplate,” “possi
Slide 3: Forward-Looking Statements
Forward-Looking Statements • ability of the Company to use technology to provide products and services that will satisfy customer demands and create efficiencies in operations and to manage risks associated therewith; • failure or breaches of our security systems or infrastructure, or those of third
Slide 4: Q3 2022 Summary
Q3 2022 Summary "I am very pleased with our third quarter results as we reported strong net income and record quarterly pre-tax, pre-provision income (non-GAAP). By design, we were able to benefit significantly from the recent rise in interest rates as net interest income and net interest margin sho
Slide 5: Q3 '22 Highlights (Comparative to Q2 '22)
Q3 '22 Highlights (Comparative to Q2 '22) Robust loan growth coupled with higher earning asset yields drive net income expansion Net Income Pre-Tax, Pre-Provision1 Diluted EPS $143.0 million $206.5 million $2.21 +$48.4 million +$54.4 million +$0.72 Return on Assets Return on Equity Efficiency Ratio2
Slide 6: Earnings Summary
Earnings Summary Differentiated, highly diversified and sustainable business model Asset Sensitivity and Robust Loan Growth Drive Net Income Expansion Higher PTPP Expected to Continue Due to Interest Rate Sensitive Portfolio ($ in Millions) ($ in Millions) $208.9 $143.0 $127.4 $177.8 $151.6 $109.1 $
Slide 7: Loan Portfolio
Loan Portfolio Balanced loan portfolio of approximately 1/3 Commercial, 1/3 Commercial Real Estate and 1/3 Specialty Finance Continued Strong Loan Growth Momentum Coupled with Higher Loan Yields Balanced Loan Mix (as of 9/30/2022) ($ in Billions) ($ in Billions) Year-over-Year Change Residential Rea
Slide 8: Deposit Portfolio
Deposit Portfolio Enviable core deposit franchise in Chicago and Milwaukee market areas Increased Funding Costs Significantly Outpaced by Higher Loan Yields Diversified Deposit Mix (as of 9/30/2022) ($ in Billions) ($ in Billions) Year-over-Year Change $2.8B or 7% Money Market $12.5 Savings $4.0 $42
Slide 9: Liquidity
Liquidity Deployed liquidity to finance earning asset growth coupled with strategic management of investment portfolio Prudent Deployment of Excess Liquidity to Fund Loan Growth Expect to Expand Investment Portfolio in Fourth Quarter Given Available Market Returns ($ in Billions) ($ in Billions) $5.
Slide 10: Capital
Capital Adequate and appropriate capital levels given the Company's risk profile Steady Capital Levels Poised to Benefit from Increased TBV Decline Related to Unrealized Losses on AFS Earnings Securities 12.1% 11.9% $59.64 $58.42 11.6% 11.6% 11.7% $53.23 $49.70 9.9% 9.9% 9.9% 9.6% 9.6% $44.67 8.9% 9
Slide 11: Net Interest Income/Margin
Net Interest Income/Margin Net interest margin benefiting from rising loan yields and prudent deployment of liquidity to fund loan growth Significant Expansion of NIM Continued to Drive NII Higher Upward Repricing of Earning Assets Significantly Outpaced Funding Costs ($ in Millions) $401.4 0.67% $3
Slide 12: Non-Interest Income
Non-Interest Income Diversified fee business supports non-interest income levels despite challenging mortgage environment Fee Businesses Contribution Lower in Rising Rate Wealth Management Business Remains Strong Despite Environment Market Volatility ($ in Millions) ($ in Millions) $162.8 $31.5 $32.
Slide 13: Non-Interest Expense
Non-Interest Expense Conservative and consistent operating philosophy Relatively Steady Staffing Expense Trend Despite Wage Pressure Improving Efficiency Ratio as Revenue Increases Without Commensurate Increase in Expenses ($ in Millions) $170.9 $172.4 $176.1 1.51% 1.53% $167.1 $167.3 $25.7 $25.6 $2
Slide 14: Loan Portfolio
Loan Portfolio Highly diversified portfolio across U.S. Loan Portfolio - Geographic Diversification1 as of 9/30/2022 Total Loan Portfolio Primary Geographic Region Commercial: 1% Canada Market: 2% Commercial, industrial and other Illinois/Wisconsin Leasing Nationwide 1% Franchise Lending Multi-State
Slide 15: Credit Quality
Credit Quality Exceptional credit quality driven by a diversified loan portfolio Continued Relatively Low Levels of Non-Performing Loans Continued Low Levels of Net Charge-Offs ($ in Millions) ($ in Millions) $97.6 0.11% $90.0 0.07% $74.4 0.03% 0.03% $72.4 0.00% $20.4 $57.3 $6.2 $9.3 $4.1 $6.4 $0.0
Slide 16: Credit Quality - Commercial Loans
Credit Quality - Commercial Loans1 Low net charge-off levels with growth upside as line utilization remains below pre-pandemic levels Strong Portfolio Growth with a Net Recovery in Q3 Non-Performing Loans Remain Low but Increased Due to a New Non-Accrual Loan in Q3 ($ in Millions) ($ in Millions) $1
Slide 17: Credit Quality - Commercial Real Estate Loans
Credit Quality - Commercial Real Estate Loans Well-diversified portfolio with a majority of its exposure in stabilized, income producing properties Continued Steady Growth with Low Charge-Offs NPLs Continue to Remain Low ($ in Millions) ($ in Millions) $9,235 $9,407 $9,578 $8,886 $8,990 $23.7 $21.7
Slide 18: Credit Quality - Premium Finance Receivables Commercial
Credit Quality - Premium Finance Receivables Commercial Net charge-off levels remain low while outstanding balances grow Significant Loan Growth NPLs Remain Below Historic Norms and Q3 Increase Relates to Administrative 90 Day Past Due Loans ($ in Millions) ($ in Millions) $5,541 $5,714 $29.7 $4,617
Slide 19: Credit Quality - Premium Finance Receivables Life
Credit Quality - Premium Finance Receivables Life Life Insurance portfolio remains extremely robust and has continued to demonstrate exceptional credit quality Reliably Strong Growth With Pristine Credit Quality Immaterial Amount of Non-Performing Loans ($ in Millions) ($ in Millions) No material ch
Slide 20: Appendix
Appendix 20
Slide 21: Glossary
Glossary Abbreviation Definition AFS Available For Sale BP Basis Point CECL Current Expected Credit Losses CET1 Ratio Common Equity Tier 1 Capital Ratio CRE Commercial Real Estate DDA Demand Deposit Account Diluted EPS Net Income per Common Share - Diluted FEMA Federal Emergency Management Agency GA
Slide 22: Non-GAAP Reconciliation
Non-GAAP Reconciliation Three Months Ended Nine Months Ended Reconciliation of Non-GAAP Net Interest Margin and September 30, June 30, March 31, December 31, September 30, September 30, September 30, Efficiency Ratio ($ in Thousands): 2022 2022 2022 2021 2021 2022 2021 (A) Interest Income (GAAP) $ 4
Slide 23: Non-GAAP Reconciliation
Non-GAAP Reconciliation Three Months Ended Reconciliation of Non-GAAP Tangible Common Equity September 30, June 30, March 31, December 31, September 30, ($'s and Shares in Thousands): 2022 2022 2022 2021 2021 Total shareholders’ equity (GAAP) $ 4,637,980 $ 4,727,623 $ 4,492,256 $ 4,498,688 $ 4,410,3