Western New England Bancorp, Inc. · NASDAQ:WNEB
Western New England Bancorp — Q1 2022 Earnings Presentation
31 slides from Western New England Bancorp's earnings presentation, Apr 26, 2022
Slide 1: Investor Presentation First Quarter 2022
Local banking is better than ever. INVESTOR PRESENTATION FIRST QUARTER 2022
Slide 2: Forward-Looking Statements
FORWARD - LOOKING STATEMENTS 2 We may, from time to time, make written or oral “forward - looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 , including statements contained in our filings with the Securities and Exchange Commission (the “SEC”), our report
Slide 3: Who We Are
WHO WE ARE Every day, we focus on showing Westfield Bank customers “ what better banking is all about . ” For us, the idea of better banking starts with putting customers first, while adhering to our core values . Our Core Values : • Integrity • Enhance Shareholder Value • Customer Focus • Community
Slide 4: Senior Management Team
SENIOR MANAGEMENT TEAM James C . Hagan, President & Chief Executive Officer Guida R . Sajdak, Executive Vice President, Chief Financial Officer & Treasurer Allen J . Miles III, Executive Vice President & Chief Lender Officer Kevin C . O’Connor, Executive Vice President & Chief Banking Officer Louis
Slide 5: Connecticut Strategy Update
5 CONNECTICUT STRATEGY UPDATE The Bank is well - positioned with four Hartford County, Connecticut locations . Continued mergers and consolidations throughout the state have created increased demand for a local, full - service, community - oriented bank, supporting the Bank’s deposit and loan growth
Slide 6: Connecticut Strategy Update
6 CONNECTICUT STRATEGY UPDATE Congratulations to the West Hartford Financial Services Center team on being recognized as “Best Bank/Financial Institution” in the annual Best of West Hartford , marking two consecutive years that the Bank has earned the top spot.
Slide 7: Connecticut Strategy Update
7 CONNECTICUT STRATEGY UPDATE On December 13 th , the Bank opened its new Granby Branch, replacing its former location at the Granby Village Shops with a new standalone branch located on East Granby Road/Route 20, a major travel route for both residents and commuters. The new location adds drive - u
Slide 8: 1Q2022 Quarterly Earnings
1Q2022 QUARTERLY EARNINGS 8 ($ in thousands , except EPS) 1Q2022 4Q2021 3Q2021 2Q2021 1Q2021 Net interest income $ 18,698 $ 18,582 $ 18,765 $ 17,804 $ 18,026 (Credit) Provision for loan losses (425) 300 (100) (1,200) 75 Non - interest income 2,348 3,856 3,295 2,409 3,004 Non - interest expense ____
Slide 9: Net Interest Income and Net Interest Margin
NET INTEREST INCOME ($) AND NET INTEREST MARGIN (%) 9 $18.0 $17.8 $18.8 $18.6 $18.7 3.24% 3.06% 3.18% 3.08% 3.18% 3.03% 2.98% 2.99% 2.97% 3.10% 2.50% 2.70% 2.90% 3.10% 3.30% 3.50% 3.70% 1Q2021 2Q2021 3Q2021 4Q2021 1Q2022 $17.2 $17.4 $17.6 $17.8 $18.0 $18.2 $18.4 $18.6 $18.8 $19.0 Net interest income
Slide 10: Total Loans
TOTAL LOANS 10 $1,757 $1,756 $1,787 $1,809 $1,880 3.86% 3.81% 3.75% 3.75% 3.75% 3.20% 3.40% 3.60% 3.80% 4.00% 4.20% 4.40% 1Q2021 2Q2021 3Q2021 4Q2021 1Q2022 $1,200 $1,300 $1,400 $1,500 $1,600 $1,700 $1,800 $1,900 $2,000 Average Loans Outstanding (excludes PPP loans) Average Loans Outstanding Average
Slide 11: Commercial and Industrial Loan Trends
COMMERCIAL AND INDUSTRIAL LOAN TRENDS 11 $205 $215 $201 $201 $210 $170 $106 $59 $25 $6 1Q2021 2Q2021 3Q2021 4Q2021 1Q2022 $100 $150 $200 $250 $300 $350 $400 C&I Loans PPP Loans Commercial and industrial loans (“C&I ”), including PPP loans of $ 215 . 9 million at March 31 , 2022 decreased $ 10 . 7 mi
Slide 12: C&I Portfolio
C&I PORTFOLIO (1) 12 (1) % of total C&I loans as of March 31, 2022, excluding PPP loans Manufacturing 18% Wholesale trade 21% Educational services 8% Heavy and civil engineering construction 8% Specialty trade 6% All other C&I , 39%
Slide 13: Small Business Administration – Paycheck Protection Program
SMALL BUSINESS ADMINISTRATION – PAYCHECK PROTECTION PROGRAM 13 (1) Balance as of March 31, 2022 ($ in millions) (2) ($ in thousands) Original Loan Amount (1) Original # of Loans Balance Outstanding (1) # of Loans Remaining Round 1 and 2 $223.1 1,386 $1.7 15 Round 3 79.1 760 4.4 38 Total $302.2 2,146
Slide 14: Commercial Real Estate Loan Trends
COMMERCIAL REAL ESTATE LOAN TRENDS 14 $861 $877 $918 $980 $1,039 1Q2021 2Q2021 3Q2021 4Q2021 1Q2022 $500 $600 $700 $800 $900 $1,000 $1,100 • Commercial real estate (“CRE”) loans of $ 1 . 0 billion at March 31 , 2022 increased $ 59 . 5 million, or 6 . 1 % , from December 31 , 2021 . • At March 31 , 2
Slide 15: Commercial Real Estate Loans
COMMERCIAL REAL ESTATE LOANS (1) 15 (1) % of total commercial real estate loans at March 31, 2022 At March 31, 2022, there were two loans totaling $12.1 million, or 1.2% of the CRE portfolio, remaining under CARES Act modification, compared to the high point of $200.0 million, or 24.0% of the CRE po
Slide 16: Residential and Consumer Loan Trends
RESIDENTIAL AND CONSUMER LOAN TRENDS 16 $689 $680 $668 $656 $669 1Q2021 2Q2021 3Q2021 4Q2021 1Q2022 $630 $640 $650 $660 $670 $680 $690 $700 Residential and Consumer Loans Period - end Loans Outstanding Residential loans, including home equity loans, and consumer loans increased $ 12 . 4 million, or
Slide 17: Total Deposits
TOTAL DEPOSITS 17 $1,631 $1,727 $1,806 $1,855 $1,899 1Q2021 2Q2021 3Q2021 4Q2021 1Q2022 $1,000 $1,100 $1,200 $1,300 $1,400 $1,500 $1,600 $1,700 $1,800 $1,900 $2,000 PERIOD - END CORE DEPOSITS At March 31 , 2022 , core deposits increased $ 44 . 2 million, or 2 . 4 % , from the linked quarter, while t
Slide 18: Average Total Deposits
AVERAGE TOTAL DEPOSITS 18 $1,520 $1,561 $1,587 $1,606 $1,618 $562 $603 $615 $654 $633 0.34% 0.27% 0.22% 0.19% 0.18% 0.00% 0.05% 0.10% 0.15% 0.20% 0.25% 0.30% 0.35% 0.40% 1Q2021 2Q2021 3Q2021 4Q2021 1Q2022 $300 $500 $700 $900 $1,100 $1,300 $1,500 $1,700 $1,900 $2,100 Average Deposits and Rates Intere
Slide 19: Average Core and Time Deposits
AVERAGE CORE AND TIME DEPOSITS 19 $1,515 $1,676 $1,757 $1,850 $1,862 0.21% 0.19% 0.16% 0.15% 0.14% 0.00% 0.05% 0.10% 0.15% 0.20% 0.25% $1,200 $1,400 $1,600 $1,800 $2,000 $2,200 $2,400 Average Core Deposits and Rates Average core deposits, including non - interest bearing deposits, increased $ 11 . 7
Slide 20: Loan-to-Deposit Ratio
LOAN - TO - DEPOSIT RATIO 20 89% 86% 83% 83% 85% 1Q2021 2Q2021 3Q2021 4Q2021 1Q2022 78% 80% 82% 84% 86% 88% 90% Period - end Loan - to - Deposit Ratio 76% 79% 81% 82% 83% 24% 21% 19% 18% 17% 1Q2021 2Q2021 3Q2021 4Q2021 1Q2022 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% Core Deposits and Time Deposits as
Slide 21: Deposit Market Share in Hampden County, MA
________ Source: SNL Financial as of June 30, 2021 Note: Total number of Westfield Bank branches shown includes the Big E seasonal branch and online deposit channel. Three Wes tfi eld branches are located in Hampshire County, MA and four Westfield branches are located in Hartford County, CT outside
Slide 22: Total Borrowings
TOTAL BORROWINGS 22 $43 $5 $4 $3 $2 1Q2021 2Q2021 3Q2021 4Q2021 1Q2022 $- $5 $10 $15 $20 $25 $30 $35 $40 $45 $50 Federal Home Loan Bank Advances (“FHLB”) Period - end Balance Outstanding ($ in millions) At March 31 , 2022 , total FHLB advances decreased $ 41 million , or 96 . 1 % , from $ 42 . 7 mil
Slide 23: Asset Quality Indicators
ASSET QUALITY INDICATORS 23 1Q2021 2Q2021 3Q2021 4Q2021 1Q2022 Total loans modified under the CARES Act $66.9M $57.0M $42.8M $42.5M $12.1M Loans modified as a % of total loans (1) 3.8% 3.2% 2.4% 2.3% 0.6% Total delinquent loans $ $9.3M $4.4M $3.1M $2.1M $2.8M Delinquent loans as a % of total loans (
Slide 24: Asset Quality
ASSET QUALITY 24 Management continues to assess the exposure of the Company’s loan portfolio to the COVID - 19 pandemic, economic trends and their potential effect on asset quality . The Company has deferred the adoption of the Current Expected Credit Loss Model , as permitted by its classification
Slide 25: Asset Quality
ASSET QUALITY 25 ($ in Millions) 1Q2021 2Q2021 3Q2021 4Q2021 1Q2022 Special Mention $38.4 $41.1 $38.0 $24.2 $28.1 Special Mention - Hotel $38.6 $25.8 $26.2 $27.3 $27.1 Total Special Mention $77.0 $66.9 $64.2 $51.5 $55.2 % of Total Loans (1) 4.4% 3.8% 3.6% 2.8% 2.9% Substandard $43.0 $37.5 $32.2 $31.
Slide 26: Capital Management
CAPITAL MANAGEMENT 26 We are well - capitalized with excess capital. Consolidated Ratio at March 31, 2022 Leverage Ratio 8.94% Common Equity Tier 1 Ratio 11.91% Tier 1 Capital Ratio 11.91% Total Capital Ratio 13.97% x From a regulatory standpoint, we are well - capitalized with excess capital. x We
Slide 27: Capital Return to Shareholders
CAPITAL RETURN TO SHAREHOLDERS 27 Year # of Shares 2018 2,189,276 2019 1,938,667 2020 1,391,496 2021 2,758,051 1Q2022 112,674 Year Annual Dividends per Share 2018 $0.16 2019 $0.20 2020 $0.20 2021 $0.20 1Q2022 $0.06 Share Repurchases Dividends On April 27 , 2021 , the Board of Directors authorized a
Slide 28: Capital Management
CAPITAL MANAGEMENT 28 $9.07 $9.29 $9.56 $9.87 $9.63 $8.44 $8.66 $8.89 $9.21 $8.97 Book Value per Share Tangible Book Value per Share (non - GAAP) Book Value Tangible Book Value (non-GAAP) Book value per share was $9.63 at March 31, 2022 compared to $9.87 at December 31, 2021. Tangible book value per
Slide 29: Appendix: Non-GAAP to GAAP Reconciliation
APPENDIX: NON - GAAP TO GAAP RECONCILIATION 29 Reconciliation of Non - GAAP to GAAP Financial Measures The Company believes that certain non - GAAP financial measures provide information to investors that is useful in understanding i ts financial condition. Because not all companies use the same cal
Slide 30: Appendix: Non-GAAP to GAAP Reconciliation
APPENDIX: NON - GAAP TO GAAP RECONCILIATION 30 Reconciliation of Non - GAAP to GAAP Financial Measures The Company believes that certain non - GAAP financial measures provide information to investors that is useful in understanding i ts financial condition. Because not all companies use the same cal
Slide 31: Westfield Bank – What Better Banking's All About
WESTFIELD BANK “WHAT BETTER BANKING’S ALL ABOUT” James C. Hagan , President and Chief Executive Officer Guida R. Sajdak , Executive Vice President and Chief Financial Officer Meghan Hibner , Vice President and Investor Relations Officer 31 141 Elm Street, Westfield, MA
Western New England Bancorp — Q1 2022 Earnings Presentation on 6ix