S&t Bancorp, Inc. · NASDAQ:STBA
S&t Bancorp — Q1 2024 Earnings Presentation
35 slides from S&t Bancorp's earnings presentation, May 7, 2024
Slide 1: First Quarter 2024
Christopher J. McComish Chief Executive Officer Mark Kochvar Chief Financial Officer First Quarter 2024
Slide 2: Forward Looking Statements and Risk Factors
Forward Looking Statements and Risk Factors This information contains or incorporates statements that we believe are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally relate to our financial condition, result
Slide 3: Corporate Profile
3 • $9.5 billion in assets • $7.6 billion in deposits • $7.7 billion in loans • $1.2 billion market cap • Stock symbol: STBA Corporate Profile
Slide 4: Geographic Footprint
Geographic Footprint 4 Serving more than 225,000 customers in Pennsylvania and Ohio Footprint comprises 9.6 million people and 215,000 businesses 1,200 team members providing award- winning customer satisfaction at 72 locations Akron Columbus Philadelphia Harrisburg Pittsburgh Indiana
Slide 5: Awards
Awards 5 Top Workplaces USA 2023 S&T was recognized as a top workplace in the United States, issued by Energage. We were chosen based solely on employee feedback. Forbes Best-In-State Banks S&T was named on the Forbes list of Best-In-State Banks 2023 for the second consecutive year. Consumers assess
Slide 6: Strategic Path Forward: Our Shared Future
6 Strategic Path Forward “Our Shared Future” VALUES PURPOSE DRIVERS
Slide 7: Strategic Drivers of Business Performance
7 Delivering long-term, sustainable financial performance (measured by top quartile Price/TBV and Total Shareholder Return) Unwavering focus on key Drivers of business performance and profitable growth ASSET QUALITY DEPOSIT FRANCHISE Loans/Deposit Ratio, Cost of Deposits ◦ Treasury Management distri
Slide 8: Positioned for Growth
Positioned for Growth 8 We have been making meaningful and scalable investments in technology and people to prepare for future growth. ◦ Enhanced governance structure ◦ Integrated, Enterprise Risk Management Program ◦ Strengthened Credit Administration practices ◦ Advanced Consumer Compliance Infras
Slide 9: First Quarter Overview
9 First Quarter Overview RETURN METRICS EARNINGS Net Income $31.2 million *Refer to appendix for reconciliation of non-GAAP financial measures EPS $0.81 ROA 1.32% ROE 9.74% ROTE* 13.85% PPNR* 1.76% HIGHLIGHTS • Solid earnings and return metrics • NIM remains strong at 3.84% • Third consecutive quart
Slide 10: Performance
PPNR / AVERAGE ASSETS * 2020 2021 2022 2023 1Q24 0.0% 0.6% 1.2% 1.8% 2.4% RETURN ON AVERAGE TANGIBLE EQUITY * 2020 2021 2022 2023 1Q24 0.0% 5.0% 10.0% 15.0% 20.0% RETURN ON AVERAGE EQUITY 2020 2021 2022 2023 1Q24 0.0% 5.0% 10.0% 15.0% RETURN ON AVERAGE ASSETS 2020 2021 2022 2023 1Q24 0.0% 0.4% 0.8%
Slide 11: Balance Sheet
Balance Sheet • Shift to higher costing deposits is moderating • Wholesale borrowings are down $130 million primarily due to deposit growth • No change in brokered deposits, shift from money market to CDs at similar cost Dollars in millions 11 1Q24 4Q23 Var $207 $234 ($27) 971 970 1 7,656 7,653 3 7,
Slide 12: Loan Mix
Loan Mix Our loan portfolio is well-diversified: Dollars in millions 12 Amount % of Total CRE $3,368 44% Consumer 2,331 30% C&I 1,597 21% Construction 360 5% Total $7,656 100%
Slide 13: CRE Maturities
CRE Maturities Dollars in millions 13 CRE MATURITIES BY SIZE: CRE MATURITIES BY INDUSTRY: Size Total # Loans Avg Size 10mm+ $88.2 6 $14.7 5mm-10mm 243.5 34 7.2 1mm-5mm 193.7 87 2.2 Under 1mm 54.8 225 0.2 Total $580.3 352 $1.6 in next 24 months CRE MATURITIES BY QUARTER: Only 17% of our CRE loans mat
Slide 14: Office CRE
Office CRE Dollars in millions 14 CBD 15% $72 OFFICE LOANS BY SIZE: Size Total # Loans Avg Size Avg LTV 10mm+ $47.3 4 $11.8 53 % 5mm-10mm 172.1 25 6.9 54 % 1mm-5mm 176.1 79 2.2 59 % Under 1mm 86.5 338 0.3 48 % Total $482.0 446 $1.1 55 % OFFICE LOAN MATURITIES BY YEAR: Avg LTV: 52% 56% 50% 55% 49% OF
Slide 15: Multifamily - CRE
Multifamily - CRE Dollars in millions 15 MULTIFAMILY LOANS BY SIZE: Size Total # Loans Avg Size Avg LTV 10mm+ $124.6 9 $13.8 64 % 5mm-10mm 153.8 21 7.3 52 % 1mm-5mm 163.8 80 2.0 53 % Under 1mm 138.6 485 0.3 58 % Total $580.8 595 $1.0 56 % MULTIFAMILY LOAN MATURITIES BY YEAR: Avg LTV: 42% 49% 49% 50%
Slide 16: Asset Quality
Asset Quality ACL Trend: Dollars in millions 16 ASSET QUALITY TRENDS • ACL down 4 basis points to 1.37% compared to 1.41% at December 31, 2023 • Net charge-offs of $6.6 million, or 0.35% of average loans (annualized) • Increase in NPAs related to a strategic exit of an operating company that resulte
Slide 17: Deposit Mix
Deposit Mix We have a strong, well-diversified deposit base of 230,000 customers: Dollars in millions 17 Amount % of Total DDA $2,189 29% MM 1,882 25% CDs 1,744 23% Savings 936 12% Int Bear DDA 849 11% Total $7,600 100% Amount % of Total Average Account Size (in $000) Average Age (in years) Personal
Slide 18: Funding Capacity
FUNDING SOURCES Funding Capacity • Strong liquidity position with well-diversified deposit base • Significant funding availability through FHLB and Federal Reserve • Insured and collateralized deposits comprise 74% of total deposits • Funding availability meets liquidity needs in both normal and str
Slide 19: Net Interest Income
• NIM was solid at 3.84% and remains well above pre-rate cycle level • NIM compression is moderating with the smallest decrease since 1Q23 • Cost of funds increases are declining as deposit mix shift moderates and higher cost borrowings are reduced Net Interest Income Dollars in millions; *Refer to
Slide 20: Noninterest Income
1Q24 1Q24 vs 4Q23 1Q24 vs 1Q23 Debit and Credit Card $4.2 ($0.3) ($0.1) Service Charges 3.8 (0.3) (0.3) Wealth 3.0 — — Mortgage 0.3 — — Other 1.5 (4.6) — Noninterest Income $12.8 ($5.2) ($0.4) Noninterest Income 20Dollars in millions • Noninterest income levels normalize • Decrease in other related
Slide 21: Noninterest Expense
1Q24 1Q24 vs 4Q23 1Q24 vs 1Q23 Salaries & Benefits $29.5 ($1.4) $1.9 Data Processing 5.0 0.4 0.7 Occupancy 3.9 0.3 — FF&E 3.5 (0.3) 0.6 Other Taxes 1.9 — 0.1 Marketing 1.9 0.5 0.1 Professional Services 1.7 (0.3) (0.1) FDIC 1.0 — — Other 6.1 (0.9) (0.6) Noninterest Expense $54.5 ($1.7) $2.8 Nonintere
Slide 22: Securities
Securities 22 • Securities portfolio is only 10% of total assets • 100% of securities portfolio is classified as available for sale • Average duration of 3.6 years at 1Q24 down from 3.7 years in 4Q21 • AOCI of $87.8 million related to securities portfolio, if realized, would decrease CET1 ratio by 1
Slide 23: Capital
Capital Dollars in millions; *Refer to appendix for reconciliation of non-GAAP financial measures 23 TCE / TA* • We have strong capital levels and are well positioned for growth • TCE / TA improvement due to strong earnings
Slide 24: Income Statement
Income Statement 1Q24 2023 2022 2021 2020 2020 Dollars in thousands, except for share data Excludes Fraud (1) Net Interest Income $83,477 $349,410 $315,783 $276,112 $279,388 Noninterest Income 12,830 57,620 58,259 64,696 59,746 Total Revenue 96,307 407,030 374,042 340,808 339,134 Noninterest Expense
Slide 25: Financial Data: Balance Sheet
Financial Data 25 Balance Sheet 1Q24 2023 2022 2021 2020 Dollars in thousands Total Securities $970,728 $970,391 $1,002,778 $910,793 $773,693 Interest-Bearing Deposits 143,927 160,802 138,149 857,192 158,903 Total Net Loans 7,551,232 7,545,528 7,082,645 6,902,936 7,126,776 Other Assets 873,216 874,8
Slide 26: Net Interest Margin
Net Interest Margin 1Q24 2023 2022 2021 2020 Securities - FTE(1) 2.81% 2.61% 2.25% 2.18% 2.49% Loans - FTE(1) 6.25% 6.04% 4.50% 3.84% 4.09% Total Interest-earning Assets - FTE(1) 5.86% 5.64% 4.06% 3.37% 3.87% Interest-bearing Deposits 2.77% 1.92% 0.40% 0.20% 0.66% Borrowings 5.59% 5.59% 3.01% 1.49%
Slide 27: Financial Data: Loan Portfolio
Financial Data 27 Loan Portfolio 1Q24 2023 2022 2021 2020 Dollars in thousands Commercial Real Estate $3,367,722 $3,357,603 $3,128,187 $3,236,653 $3,244,974 Commercial and Industrial 1,597,119 1,642,106 1,718,976 1,728,969 1,954,453 Commercial Construction 360,086 363,284 399,371 440,962 474,280 Tot
Slide 28: Asset Quality
Asset Quality 1Q24 2023 2022 2021 2020 Dollars in thousands Total Nonaccrual Loans $33,209 $22,946 $19,052 $66,291 $146,774 Nonaccrual Loans/Total Loans 0.43% 0.30% 0.27% 0.95% 2.03% Nonperforming Assets/Total Loans + OREO 0.44% 0.30% 0.31% 1.13% 2.06% YTD Net Charge-offs/Average Loans(1) 0.35% 0.18
Slide 29: Capital
Capital 1Q24 2023 2022 2021 2020 Tier 1 Leverage 11.30% 11.21% 11.06% 9.74% 9.43% Common Equity Tier 1 – Risk-Based Capital 13.59% 13.37% 12.81% 12.03% 11.33% Tier 1 – Risk-Based Capital 13.91% 13.69% 13.21% 12.43% 11.74% Total – Risk-Based Capital 15.49% 15.27% 14.73% 13.79% 13.44% Tangible Common
Slide 30: TCE/Tangible Assets and Efficiency Ratio Reconciliation
1Q24 4Q23 3Q23 2Q23 1Q23 4Q22 3Q22 2Q22 1Q22 4Q21 Tangible Common Equity (TCE)/Tangible Assets (non-GAAP) Total shareholders' equity $1,295,074 $1,283,445 $1,223,532 $1,212,853 $1,227,795 Less: goodwill and other intangible assets, net of deferred tax liability (376,396) (376,631) (376,883) (377,144
Slide 31: Definitions of GAAP to Non-GAAP Financial Measures
2020 Excludes Fraud Net Income Excluding Nonrecurring items Net income $21,040 Nonrecurring items 58,671 Tax effect of nonrecurring items (12,321) Adjusted net income (non-GAAP) $67,390 Diluted Earnings Per Share Adjusted net income (non-GAAP) $67,390 Average shares outstanding - diluted 39,073 Dilu
Slide 32: ROTE Reconciliation
1Q24 2023 2022 2021 2020 2020 Excludes Fraud Return on Average Tangible Shareholders' Equity (ROTE) (non-GAAP) Net income(1) $125,643 $144,781 $135,520 $110,343 $21,040 $21,040 Nonrecurring items — — — — — 58,671 Tax effect of nonrecurring items — — — — — (12,321) Adjusted net income (non-GAAP)(1) $
Slide 33: PPNR/Average Assets Reconciliation
1Q24 2023 2022 2021 2020 2020 Excludes Fraud PPNR/Average Assets (Non-GAAP) Income before taxes $39,160 $178,804 $168,930 $135,668 $21,039 Plus: provision for credit losses 2,627 17,892 8,366 16,215 131,424 Total adjusted income before taxes (non-GAAP) $41,787 $196,696 $177,296 $151,883 $152,463 Ave
Slide 34: NIM Reconciliation
1Q24 2023 2022 2021 2020 Interest and Dividend Income Interest-bearing deposits with banks $2,066 $7,344 $2,952 $973 $515 Securities 6,744 25,207 22,449 17,432 18,060 Loans 118,493 442,675 314,774 270,460 300,960 Other earning assets 451 2,675 576 397 929 Total Interest and Dividend Income $127,754
Slide 35: Christopher J. McComish and Mark Kochvar
Christopher J. McComish Chief Executive Officer Mark Kochvar Chief Financial Officer First Quarter 2024