Flagstar Bank, N.a. · NYSE:FLG
Flagstar Bank, N.a — New York Community Bancorp — Q2 2024 Earnings Presentation
25 slides from Flagstar Bank, N.a's earnings presentation, Jul 25, 2024
Slide 1: Second Quarter 2024 Results
Second Quarter 2024 Results July 25, 2024
Slide 2: Cautionary Statement
2nd Quarter 2024 2 Cautionary Statement Forward-Looking Information The presentation may include forward‐looking statements within the meaning of the federal securities laws by the Company pertaining to such matters as our goals, intentions, and expectations regarding (a) revenues, earnings, loan pr
Slide 3: Significant Progress Continues in Our Transition Year
2nd Quarter 2024 3 Significant Progress Continues in Our Transition Year Long-Term Targets Strategic Update ▪ Strategic sales add ~130 basis points to CET1 ratio ▪ Pro-forma CET1 of 11.2%, in line or above peers ▪ Incremental improvements to NIM and NII through loan portfolio repricing Achievable Ca
Slide 4: Positive Momentum Continued During Second Quarter 2024
2nd Quarter 2024 4 Positive Momentum Continued During Second Quarter 2024 On Our Business Plan 4 1 Meaningfully Enhanced Liquidity and Capital 3 Meaningful CRE Payoffs at Par, Including Nearly 50% in Classified Categories Further Actions Taken on the Loan Portfolio to Properly Evaluate Remaining Ris
Slide 5: Meaningfully Revamped Senior Leadership and Key Functional Areas
2nd Quarter 2024 5 Joseph Otting Executive Chairman, President & Chief Executive Officer Craig Gifford Senior Executive Vice President & Chief Financial Officer Reginald Davis Senior Executive Vice President & President of Consumer and Small Business Banking Lee Smith Senior Executive Vice President
Slide 6: Divestiture Update
2nd Quarter 2024 6 Divestiture Update • Sold ~$6.1 billion in loans at par • Adds approximately 70 bps to CET1 ratio • Proceeds will be used to pay down wholesale borrowings and fund future C&I loan growth Mortgage Warehouse 1 • At closing, will add approximately 60 bps to CET1 ratio • Will reduce h
Slide 7: Capital and liquidity versus peers
2nd Quarter 2024 7 NYCB Flagstar Q4’23 NYCB Flagstar Q1’24 NYCB Flagstar Q2’24 Category IV Banks Most Recent Available $50 – 100B Asset Banks Most Recent Available CET1 Ratio, as Converted (Pro-forma for warehouse and mortgage sale) 9.0% 10.1%(1) 11.2%(1) 10.6% 11.0% CET1 Ratio, as Converted (Pro-fo
Slide 8: Forecast Update
2nd Quarter 2024 8 Forecast Update 2024 2025 2026 Q4’26 Annualized Q2’27 Annualized Diluted Core EPS(1)(2) ($2.20 – 2.30) $0.00 – 0.05 $1.25 – 1.30 $1.60 – 1.70 $2.00 – 2.10 Efficiency Ratio(3) 90 – 95% 75 – 80% 55 – 60% 50 – 55% 50 – 55% CET1 Ratio 10.75 – 11.00% 10.50 – 11.00% 10.25 – 10.50% 10.25
Slide 9: Forecast Update (cont'd)
2nd Quarter 2024 9 ($ in millions) 2024 2025 2026 Q4’26 Annualized Q2’27 Annualized Net Interest Income $2,200 – 2,250 $2,200 – 2,250 $2,800 – 2,900 $2,950 – 3,050 $3,050 – 3,150 Net Interest Margin 2.00 – 2.10% 2.05 – 2.20% 2.50 – 2.70% 2.65 – 2.75% 2.80 – 2.90% Provision for Loan Losses $900 – 1,0
Slide 10: Significant CRE Portfolio Payoffs
2nd Quarter 2024 10 Significant CRE Portfolio Payoffs Payoffs Payoffs as a % of Loan Category Classified (%) Multi-Family $714 million 2.0% 45% Office $110 million 4.2% 94% Non-Office CRE $108 million 2.1% 24% Total CRE $932 million 2.1% 48% Nearly half of the payoffs were from classified loans and
Slide 11: Loan Portfolio | In-Depth Review
2nd Quarter 2024 11 Thorough review on MF and CRE loan portfolios now at 75% and will continue to proactively review remaining population of lower risk small balance loans Multi-Family $33.9 45% C&I $17.8 24% CRE $13.2 18% 1-4 Family $5.8 8% Co-op $2.1 3% Other $1.8 2% Multi-Family $33.9 77% Non-Off
Slide 12: Multi-Family Portfolio | Overview
2nd Quarter 2024 12 Multi-Family Portfolio | Overview Highlights ◼ Q2’24 Multi-Family, excluding Co-op, portfolio ALLL: 1.81% | Increased from 1.36% in Q1’24 ◼ Increase in loan loss reserve reflects impact of continued higher rates and persistent inflation on some borrowers ◼ Over the past 18 months
Slide 13: Multi-Family Portfolio | In-Depth Review
2nd Quarter 2024 13 $2,043 $4,986 $5,079 $21,367 2024 2025 2026 2027+ Multi-Family Portfolio | In-Depth Review Highlights ◼ 80% of total Multi-family loans reviewed to date ◼ 100% of the largest loans have been reviewed Multi-Family Portfolio Reviewed (UPB) Under Review $6.9B 20% Reviewed $27.1B 80%
Slide 14: Office Portfolio | In-Depth Review
2nd Quarter 2024 14 Highlights ◼ Already reviewed 82% of office portfolio, remaining is smaller balance loans ◼ ALLL coverage on Office portfolio was lower QoQ driven by increase in chargeoffs ◼ When chargeoffs for last 4 quarters are combined with allowance for loan loss on office loans, adjusted c
Slide 15: Non-Office CRE Portfolio | Overview
2nd Quarter 2024 15 Non-Office CRE Portfolio | Overview ◼ Q2’24 Non-Office CRE portfolio ALLL: 1.88%, or 2.19% excluding owner-occupied ◼ In-depth reviews performed on 48% of the portfolio ◼ Most loans under review are non-New York City small balance loans Total Non-Office CRE Portfolio Profile (UPB
Slide 16: ACL as a % to LHFI increased to 1.78%
2nd Quarter 2024 16 ACL as a % to LHFI increased to 1.78% (+$40 Million) 000 3/31/2024 6/30/2024 ($ in millions) Allowance ALLL % Allowance ALLL % Change in ALLL % Multi-Family $479 1.30% $618 1.71% 41bps Multi-Family (excl. Co-op) $472 1.36% $613 1.81% 45bps Co-op $7 0.33% $5 0.25% -12bps CRE $434
Slide 17: Asset Quality
2nd Quarter 2024 17 ◼ Total loans 30 to 89 days past due increased to $1.2 billion at quarter-end ◼ Of the $1.2 billion of 30 to 89 days past due, $0.7 billion were current as of Jully 24 ◼ Adjusting for current loans as of July 24, the increase in loans 30 to 90 days past due would have only increa
Slide 18: Deposits | Overview
2nd Quarter 2024 18 Industry Balance ($B) 6/30/2024 Noninterest-Bearing Demand $17.9 Interest-Bearing Demand $15.3 Money Markets $6.4 Savings $10.6 Retail CDs $22.4 Jumbo CDs $6.4 Total Deposits $79.0 Deposits | Overview 84% Insured and Collateralized DepositsWell Diversified Deposit Base by Product
Slide 19: Liquidity Sources vs. Uninsured Deposits
2nd Quarter 2024 19 $18.2 $15.6 $5.9 $39.7 $12.8 Liquidity Net Uninsured Deposits Liquidity Sources vs. Uninsured Deposits Significant Liquidity Capacity Relative to Uninsured Deposits ▪ Our liquidity profile improved significantly compared to prior quarter ▪ Pro-forma total liquidity of $39.7 billi
Slide 20: Q2 2024 Financial Highlights
2nd Quarter 2024 20 ($ in millions) NYCB Flagstar 6/30/24 Net Interest Income $557 Noninterest Income $114 Noninterest Expense(1) $638 Provision for Loan Losses $390 Net Income / (Loss) to Common Shareholders ($333) Diluted Earnings / (Loss) per Common Share ($1.14) Dividends Per Share $0.01 ROAA NM
Slide 21: Investment Profile
2nd Quarter 2024 21 Investment Profile ◼ Pro-forma for the capital raise, NYCB currently trades at approximately 0.XXx of fully converted tangible book value, compared to 1.XXx for Category IV banks and 1.XXx for banks with assets between $50 - $100 billion ◼ Q2’24 TBV Per Share: $20.89 or $18.29 fu
Slide 22: Appendix
Appendix
Slide 23: Reconciliations of GAAP and Non-GAAP Measures
2nd Quarter 2024 23 Note: $ in millions except share data | Please note that columns of data may not add due to rounding. Reconciliations of GAAP and Non-GAAP Measures Tangible Book Value Per Share - As Preferred Converted and Post-Share Split 6/30/2024 Total stockholders equity $8,397 Less: Core de
Slide 24: Peer Groups
2nd Quarter 2024 24 Category IV Banks Ticker Citizens Financial CFG Fifth Third Bancorp FITB First Citizens Banc. FCNC.A Huntington Banc. HBAN KeyCorp KEY M&T Bank MTB Regions Financial RF Banks with $50B - $100B in Assets Ticker BOK Financial BOKF Columbia Banking System COLB Comerica CMA East West
Slide 25: For More Information
2nd Quarter 2024 25 Visit our website: ir.myNYCB.com E-mail requests to: ir@myNYCB.com Call Investor Relations at: (516) 683-4420 Write to: Investor Relations New York Community Bancorp, Inc. 102 Duffy Avenue Hicksville, NY 11801 For More Information
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