Columbia Banking System, Inc. · NASDAQ:COLB
Columbia Banking System — Q4 2023 Earnings Presentation
35 slides from Columbia Banking System's earnings presentation, Jan 24, 2024
Slide 1: 4th Quarter 2023 Earnings Presentation
th 4 Quarter 2023 Earnings Presentation January 24, 2024
Slide 2: Disclaimer
2 Disclaimer FORWARD-LOOKING STATEMENTS This presentation includes forward-looking statements within the meaning of the "Safe-Harbor" provisions of the Private Securities Litigation Reform Act of 1995, which management believes are a benefit to shareholders. These statements are necessarily subject
Slide 3: Financial Highlights and Summary Financial Statements
FINANCIAL HIGHLIGHTS AND SUMMARY FINANCIAL STATEMENTS Q4 2023
Slide 4: Performance Ratios
4 Performance Ratios For the Quarter Ended Q4 2023 Highlights (compared to Q3 2023) Q4 2023 Q3 2023 Q2 2023 Q1 2023 Q4 2022 ■ Net interest margin was 3.78%, down 13 (1) Net interest margin 3.78 % 3.91 % 3.93 % 4.08 % 4.01 % basis points from the prior quarter. Higher Efficiency ratio (1) 64.81 % 57.
Slide 5: Selected Period-End Balance Sheet
5 Selected Period-End Balance Sheet ($ in millions, except per-share data) Q4 2023 Q3 2023 Q2 2023 Q1 2023 Q4 2022 Q4 2023 Highlights (compared to Q3 2023) ASSETS: ■ Loans increased $271 million, or 3% on an Total assets $52,173.6 $51,993.8 $53,592.1 $53,994.2 $31,848.6 annualized basis, reflecting
Slide 6: Summary Income Statement
6 Summary Income Statement For the Quarter Ended Q4 2023 Highlights (compared to Q3 2023) ($ in millions, except per-share data) Q4 2023 Q3 2023 Q2 2023 Q1 2023 Q4 2022 Net interest income before provision $453.6 $480.9 $484.0 $374.7 $305.5 ■ Net interest income decreased by $27 million as higher de
Slide 7: Income Statement Component Details
7 Income Statement Component Details For the Quarter Ended December 31, 2023 Q4 2023 Highlights LESS: EQUALS LESS: EQUALS Adjusted ■ Non-operating items that include Non-Operating Operating Merger-Related Operating ($ in thousands, except per-share data) GAAP Income Items (1) Income (2) Items (3) cu
Slide 8: Income Statement Highlights
INCOME STATEMENT HIGHLIGHTS Q4 2023
Slide 9: Net Interest Income and Net Interest Margin
9 Net Interest Income and Net Interest Margin Net Interest Income and Net Interest Margin Net Interest Margin: Q3 2023 vs Q4 2023 $500 $484 $481 5.00% $454 3.91% 0.08% 0.02% $375 0.17% 0.01% 3.78% $400 (0.03)% (0.02)% 4.50% $305 $ in millions $300 (0.36)% 4.00% 4.08% $200 4.01% 3.93% 3.91% 3.78% 3.5
Slide 10: Interest Rate Sensitivity: Loans
10 Interest Rate Sensitivity: Loans Loan Repricing Detail (1), (2) Loan Maturities at December 31, 2023 ($ in millions) Q3 2023 Q4 2023 Q3 2023 Q4 2023 <=6 7 to 12 13 to 24 25 to 36 37 to 60 61+ Fixed $15,793 $15,557 42 % 41 % ($ in millions) Months Months Months Months Months Months Total Fixed $1,
Slide 11: Interest Rate Sensitivity: Balance Sheet
11 Interest Rate Sensitivity: Balance Sheet Interest Rate Simulation Impact on Net Interest Income (1), (2) December 31, 2023 September 30, 2023 December 31, 2022 Ramp Shock Ramp Shock Ramp Shock Year 1 Year 2 Year 1 Year 2 Year 1 Year 2 Year 1 Year 2 Year 1 Year 2 Year 1 Year 2 Up 200 basis points
Slide 12: Non-Interest Income
12 Non-Interest Income For the Quarter Ended Q4 2023 Highlights (compared to Q3 2023) ($ in millions) Q4 2023 Q3 2023 Q2 2023 Q1 2023 Q4 2022 ■ Financial services and trust revenue Service charges on deposits $17.3 $17.4 $16.5 $14.3 $12.1 declined due to the transition of Columbia Card-based fees 14
Slide 13: Non-Interest Expense
13 Non-Interest Expense Annualized Cost Synergies Realized by Period End Non-Interest Expense ("NIE"): Q3 2023 vs Q4 2023 $32.9 $2.0 $200 $2.3 $337.2 $2.4 $(11.8) $1.8 $3.5 $140 million (1) $143 million(1) $304.1 $150 $ in millions $105 million(1) $100 $59 million(1) $50 $30 million(1), (2) Q3 2023
Slide 14: Outlook
14 Outlook 2023 Results (1) Full-Year 2024 Outlook Three Months Ended Twelve Months Ended December 31, 2023 December 31, 2023 As of January 24, 2024 Notes Assumes balance sheet growth in the 0-3% range from Average earning assets $48b $46b $48b - $49b year-end 2023. Forward outlook includes 3 rate c
Slide 15: Balance Sheet Highlights
BALANCE SHEET HIGHLIGHTS Q4 2023
Slide 16: Securities Portfolio Overview
16 Securities Portfolio Overview Available for Sale Securities Portfolio at December 31, 2023 (1) Available for Sale Securities Portfolio % of Total Percentage Gain / Loss at December 31, 2023 Current Amortized Unrealized Unrealized AFS Effective ($ in millions) Par Cost Gains Losses Fair Value Port
Slide 17: Liquidity Overview
17 Liquidity Overview Select Balance Sheet Items Total Off-Balance Sheet Liquidity Available at December 31, 2023 Sequential Gross Net Three Months Ended Quarter Change ($ in millions) Availability Utilization Availability ($ in millions) Q4 2023 Q3 2023 Q2 2023 Q1 2023 Q4 2023 FHLB lines $11,995 $3
Slide 18: Loan Roll Forward Activity
18 Loan Roll Forward Activity Three Months Ended December 31, 2023 Twelve Months Ended December 31, 2023 $4,058 $37,171 $1,076 $42 $37,442 $10,884 $117 $37,442 ($354) ($119) ($1,870) ($1,549) ($447) ($281) $ in millions $ in millions $26,156 Beginning New Net Prepayments Payoffs or Other Ending Begi
Slide 19: Purchase Accounting Details
19 Purchase Accounting Details Adjustment at Closing Remaining Balances at Select Purchase Accounting Items (1) February 28, 2023 September 30, 2023 December 31, 2023 (2) Notes ITEMS TO ACCRETE THROUGH INTEREST INCOME: Available for sale securities - rate discount $(1,011) million $(586) million $(5
Slide 20: Loan and Lease Characteristics: Overall Portfolio and Q4 2023 Production
20 Loan and Lease Characteristics: Overall Portfolio and Q4 2023 Production Mortgage Portfolio Composition at December 31, 2023 Owner Occupied CRE • Portfolio average loan size of $994,000 • Portfolio average loan size of $480,000 Multifamily, 15% • 4Q23 average loan size of $1.5 million • 4Q23 aver
Slide 21: CRE and C&I Portfolio Composition
21 CRE and C&I Portfolio Composition CRE Portfolio Composition (1) C&I Portfolio Composition (1) $17.4 Billion at December 31, 2023 $9.7 Billion at December 31, 2023 Special Purpose, 7.6% Hotel/Motel, 4.2% Agriculture, 8.3% Other, 14.3% Contractors, 7.4% Other Healthcare, 3.1% Retail, 11.7% Other, 1
Slide 22: Office Portfolio Details
22 Office Portfolio Details Office Portfolio Metrics at December 31, 2023 Number of Loans by Balance ■ Loans secured by office properties Average loan size $1.3 million represented 8% of our total loan 1,746 1,719 1,682 portfolio at December 31, 2023. Average LTV 56% DSC (non-owner occupied) 1.72x ■
Slide 23: Allowance for Credit Losses ("ACL")
23 Allowance for Credit Losses (“ACL”) Allowance for Credit Losses by Loan Segment Current Expected Credit Losses (“CECL”) Details Q4 2023 Net % of Loans and ■ Provision expense of $55 million includes $53 (Charge-offs) Reserve Build Leases ($ in thousands) 9/30/2023 Recoveries (Release) 12/31/2023
Slide 24: Credit Quality
24 Credit Quality ■ If the remaining credit discount on loans of $80 million at December 31, 2023 is added to the ACL of $464 million at December 31, 2023, the ACL would increase to 1.45% of loans from the reported 1.24% level. ■ The increase in classified asset ratios between December 31, 2022 and
Slide 25: Diversified Commercial Bank Model Supports Granular, High-Quality Deposit Base
25 Our Diversified Commercial Bank Business Model with a Strong Retail Presence Supports our Granular, High-Quality Deposit Base Deposits by Type December 31, 2023 September 30, 2023 June 30, 2023 March 31, 2023 Average consumer account balance $19 thousand $19 thousand $19 thousand $20 thousand Ave
Slide 26: Capital Management
26 Capital Management 11.8% 12.0% 1.3% 10.0% 9.6% 9.6% 1.1% 8.0% 7.6% 2.6% 1.6% 6.0% 10.5% 4.0% 8.5% 6.0% 7.0% 2.0% —% Tier 1 Leverage CET1 Tier 1 Risk-Based Total Risk-Based Capital Threshold ¹ Capital Above Threshold ² ■ Declared a quarterly cash dividend of $0.36 per common share on November 13,
Slide 27: Appendix
APPENDIX Income Statement Component Details Comparisons and Other Non-GAAP Reconciliation
Slide 28: Income Statement Component Details: GAAP Income
28 Income Statement Component Details: GAAP Income For the Quarter Ended Notable Items ($ in thousands, except per-share data) Q4 2023 Q3 2023 Q2 2023 Q1 2023 Q4 2022 Interest income $691,634 $696,013 $675,729 $475,951 $352,247 ■ Q1 2023 results include only one month Interest expense 238,011 215,13
Slide 29: Income Statement Component Details: Impact of Non-Operating Items
29 Income Statement Component Details: Impact of Non-Operating Items For the Quarter Ended Notable Items ($ in thousands, except per-share data) Q4 2023 Q3 2023 Q2 2023 Q1 2023 Q4 2022 Interest income $— $— $— $— $— ■ This table represents items that are Interest expense — — — — — excluded from GAAP
Slide 30: Income Statement Component Details: Operating Income (Non-GAAP)
30 Income Statement Component Details: Operating Income (Non-GAAP) For the Quarter Ended Notable Items ($ in thousands, except per-share data) Q4 2023 Q3 2023 Q2 2023 Q1 2023 Q4 2022 Interest income $691,634 $696,013 $675,729 $475,951 $352,247 ■ The components of this table represent Interest expens
Slide 31: Income Statement Component Details: Impact of Merger-Related Items
31 Income Statement Component Details: Impact of Merger-Related Items For the Quarter Ended Notable Items ($ in thousands, except per-share data) Q4 2023 Q3 2023 Q2 2023 Q1 2023 Q4 2022 Interest income $68,943 $76,840 $74,723 $31,895 $387 ■ This table represents merger-related Interest expense (244)
Slide 32: Income Statement Component Details: Adjusted Operating Income (Non-GAAP)
32 Income Statement Component Details: Adjusted Operating Income (Non-GAAP) For the Quarter Ended Notable Items ($ in thousands, except per-share data) Q4 2023 Q3 2023 Q2 2023 Q1 2023 Q4 2022 Interest income $622,691 $619,173 $601,006 $444,056 $351,860 ■ The components of this table represent Intere
Slide 33: Non-GAAP Reconciliation: Tangible Capital and Net Interest Income & Margin
33 Non-GAAP Reconciliation: Tangible Capital and Net Interest Income & Margin For the Quarter Ended ($ in thousands, except per-share data) Q4 2023 Q3 2023 Q2 2023 Q1 2023 Q4 2022 ($ in thousands) Q4 2023 Q3 2023 Q2 2023 Q1 2023 Q4 2022 Total shareholders' equity a $4,995,034 $4,632,162 $4,828,188 $
Slide 34: Non-GAAP Reconciliation
34 Non-GAAP Reconciliation For the Quarter Ended For the Quarter Ended ($ in thousands) Q4 2023 Q3 2023 Q2 2023 Q1 2023 Q4 2022 ($ in thousands) Q4 2023 Q3 2023 Q2 2023 Q1 2023 Q4 2022 Net interest income c $ 453,623 $ 480,875 $ 483,975 $ 374,698 $ 305,479 Non-Interest Income Adjustments Gain on sal
Slide 35: Non-GAAP Reconciliation (cont.)
35 Non-GAAP Reconciliation (cont.) For the Quarter Ended For the Quarter Ended ($ in thousands, except per-share data) Q4 2023 Q3 2023 Q2 2023 Q1 2023 Q4 2022 ($ in thousands) Q4 2023 Q3 2023 Q2 2023 Q1 2023 Q4 2022 Select Per-Share & Performance Metrics Earnings per share - basic (1) j/r $ 0.45 $ 0
Columbia Banking System — Q4 2023 Earnings Presentation on 6ix