Beacon Financial Corporation · NYSE:BBT
Beacon Financial — Berkshire Hills Bancorp — Q4 2024 Earnings Presentation
25 slides from Beacon Financial's earnings presentation, Jan 30, 2025
Slide 1: Berkshire Hills Bancorp 4Q 2024 Earnings Presentation
Berkshire Hills Bancorp NYSE:BHLB 4Q 2024 Earnings Presentation https://ir.berkshirebank.com JANUARY 30, 2024
Slide 2: Forward-Looking Statements
Forward-Looking Statements This document contains “forward-looking statements” within the meaning of section 27A of the Securities Act of 1933, as amended, and section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding our proposed merger with Brookline Bancorp, I
Slide 3: Additional Information and Where To Find It
Additional Information and Where To Find It This presentation contains information with respect to the proposed transaction involving Berkshire and Brookline. This material is not a solicitation of any vote or approval of the Berkshire or Brookline stockholders and is not a substitute for the joint
Slide 4: Key Highlights: 4Q24 and FY2024
KEY HIGHLIGHTS: 4Q24 AND FY2024 4Q24 FY2024 Robust improvement in operating earnings1 • EPS of $0.60 (+3% QoQ, +28% YoY) • EPS of $2.22 (+4% YoY) Financial • Net Income of $26.0M (+5% QoQ, +29% YoY) • Net Income of $94.9M (+2% YoY) Performance • Non-Interest Expenses of $71M (-2% QoQ, -6% YoY) • Non
Slide 5: Merger of Equals: Creating a Preeminent Northeast Franchise
Merger of Equals: Creating a Preeminent Northeast Franchise Increased Scale $24B $19B $18B Assets Loans Deposits VT 9.8% 148 $2.6B CET1 Branches Market cap NY Enhanced Performance 1.28% 16.5% 48% ‘26 ROAA ‘26 ROATCE ‘26 Efficiency MA Compelling Metrics $323M 40% 23% RI ‘26 Net ‘26 GAAP EPS ‘26 Cash
Slide 6: Merger Rationale: Partnering to Create Value
Me r g e r R a t io n a le | P a r t n e r in g t o C r e a t e Va lu e ▪ Transformative partnership creating a preeminent $24 billion Northeast franchise positioned to benefit from significant economies of scale Strategically ▪ Combines Berkshire’s stable, more rural funding base with Brookline’s C
Slide 7: FY 2024 Overview
FY 2024 Overview GAAP NET INCOME OF $61.0M, or $1.43 EPS • Operating Earnings: $94.9M, or $2.22 EPS +$1.7M or +$0.08 YoY • Net Interest Margin, FTE: 3.16% -11 bps YoY • Net Interest Income, non FTE1: $351.6M -$17.5M or -5% YoY • Operating Non-Interest Income: $82.1M +$14.3M or +21% YoY • Operating N
Slide 8: 4Q 2024 Overview
4Q 2024 Overview GAAP NET INCOME OF $19.7M, or $0.46 EPS • Operating Earnings: $26.0M, or $0.60 EPS +$1.2M or +$0.02 QoQ; +$5.8M or +$0.13 YoY • Net Interest Margin, FTE: 3.14% -2 bps QoQ; +3 bps YoY • Net Interest Income, non FTE1: $86.9M -$1.2M or -1% QoQ; -$1.6M or -2% YoY • Operating Non-Interes
Slide 9: Loans: Average Balances
($M) Loans: Average Balances CRE C&I Resi Consumer +38 (+0.4%) 9,233 55 55 9,271 424 -22 -50 374 2,712 2,690 1,380 1,435 QoQ 4,717 4,772 3Q24 CRE C&I Resi Consumer 4Q24 +281 (+3%) 303 68 34 9,271 8,990 -124 374 498 2,690 2,656 1,435 1,367 YoY 4,469 4,772 4Q23 CRE C&I Resi Consumer 4Q24 Notes: Balanc
Slide 10: Deposits: Average Balances
($M) Deposits: Average Balances Non-Interest Bearing Money Market Time NOW Savings +299 (+3%) 43 21 111 1 123 9,659 9,360 2,430 2,553 1,002 1,003 QoQ 2,935 3,046 743 764 2,250 2,293 3Q24 Non-Interest NOW Money Market Savings Time 4Q24 Bearing -277 (-3%) 9,936 51 9,659 -195 -69 -59 -5 2,558 2,553 1,0
Slide 11: Net Interest Income
($000S) Net Interest Income -1,204 (-1%) 88,059 2,878 86,855 2,632 -1,461 -5,253 QoQ 3Q24 Loans Deposits Borrowings Investments 4Q24 -1,566 (-2%) 88,421 2,215 1,302 86,855 -2,886 -2,197 YoY 4Q23 Loans Deposits Borrowings Investments 4Q24 11 Note: NII on an FTE basis was $88.8M (-$1.3M or -1% QoQ; -$
Slide 12: Operating Non-Interest Income
($000S) Operating Non-Interest Income +1,653 (+8%) 1,527 23,160 1,615 21,507 -27 -868 -419 -175 QoQ 3Q24 Deposit Loan Related Gain on Wealth FV Adj. on Other 4Q24 Related Fees Fees SBA Loans Management Securities Fees +6,486 (+39%) 4,352 23,160 2,253 264 981 -1,120 16,674 -244 YoY 4Q23 Deposit Loan
Slide 13: Operating Non-Interest Expense
($000S) Operating Non-Interest Expense -1,239 (-2%) 72,257 656 71,018 227 -1,734 -39 -349 QoQ 3Q24 Compensation Occupancy and Technology Professional Other 4Q24 and Benefits Equipment Services -4,305 (-6%) 75,323 -1,166 -1,219 71,018 -1,085 -652 -183 YoY 4Q23 Compensation Occupancy and Technology Pr
Slide 14: Asset Quality
($M) Asset Quality NON-PERFORMING LOANS NET CHARGE OFFS 0.39% 0.26% 0.24% 0.26% 0.26% 0.20% 0.24% 0.24% 0.23% 0.18% 0.14% 24.0 24.4 0.07% 5.6 21.4 21.5 21.3 4.4 4.0 3.3 1.7 4Q23 1Q24 2Q24 3Q24 4Q24 4Q23 1Q24 2Q24 3Q24 4Q24 NPLs NPLs/Total Loans 10 Year Avg. NCOs Annualized NCO/Avg. Loans 10 Year Avg
Slide 15: CRE Is Well-Diversified by Property Type and Geography
C R E i s W e l l - D i v e r s i f i e d b y P r o p e r t y Ty p e a n d G e o g r a p h y Portfolio by Geography Portfolio Metrics ➢ CRE Portfolio is diversified across our markets, 10% with no exposure to NYC 7% Massachusetts New York ➢ CRE portfolio is composed of diverse property 3% 39% Connec
Slide 16: Office Portfolio
Office Portfolio Office Portfolio & Asset Quality Office Portfolio Metrics Rural, ➢ As of 4Q24, Office CRE portfolio totals ~$507M or 6% 5.4% of Total Loans ~93% of portfolio is within footprint and 65% is ➢ Solid portfolio performance with NPLs of ~0.7% and CBD, Suburban no NCOs 29% Suburban, ➢ No
Slide 17: Multifamily Portfolio
Multifamily Portfolio Multifamily Portfolio Multifamily Portfolio Metrics ➢ Multifamily Portfolio is diversified across our markets, with no exposure to NYC properties ➢ As of 4Q24, Multifamily portfolio totals ~$637M or ~6.8% of Total Loans ➢ NPLs are isolated to one small credit ➢ No exposure to a
Slide 18: Appendix
Appendix 18 »<BerkshireHillsBancorp
Slide 19: Run-Off Portfolios
Run-Off Portfolios EOP ($M) % 4Q24 4Q24 3Q24 2Q24 4Q24 3Q24 2Q24 Portfolios 4Q24 Total 3Q24 2Q24 1Q24 4Q23 NCOs NCOs NCOs NPLs NPLs NPLs Loans ($M) ($M) ($M) ($M) ($M) ($M) Upstart 7 0.1% 10 67 78 90 1.4 3.8 1.3 0.01 0.01 0.05 Firestone 41 0.4% 48 57 66 77 0.2 -0.01 0.1 1.30 1.48 1.82 Total 48 0.5%
Slide 20: Solid Liquidity to Cover All Uninsured Deposits
Solid Liquidity to Cover All Uninsured Deposits Estimated Uninsured Deposits and Available Liquidity ($M) Available Liquidity 5,246 ($M) 9/30/243 12/31/24 Uninsured Deposits¹ 3,433 4,191 4,326 1,562 Less: Collateralized Deposits² 186 191 Uninsured Deposits (after exclusions) 3,247 4,000 1,464 Total
Slide 21: Operating Expense Growth Outperformance Relative to Peers
Operating Expense Growth Outperformance Relative to Peers BHLB has managed Operating Expenses better than peers in last three years Analysts expect FY’24/FY’23 peer expenses +3-4%, while BHLB’s actual expenses were -3% • Berkshire’s commitment to managing expenses with discipline and transparency ha
Slide 22: Non-GAAP Reconciliation (By Quarter)
Non-GAAP Reconciliation (By Quarter) At or for the Quarters Ended Dec. 31, Sept. 30, June 30, March 31, Dec. 31, (in thousands) 2024 2024 2024 2024 2023 Total non-interest income $ 23,325 $ 37,555 $ 20,133 $ (32,599) $ (8,383) Adj: Net (gains) on sale of business operations and assets (193) $ (16,04
Slide 23: Non-GAAP Reconciliation (By Quarter Continued and Notes)
Non-GAAP Reconciliation (By Quarter Continued and Notes) Dec. 31, Sept. 30, June 30, March 31, Dec. 31, 2024 2024 2024 2024 2023 (in millions, except per share data) Total average assets (F) $ 11,596 $ 11,695 $ 11,692 $ 11,755 $ 11,862 Total average shareholders' equity (G) 1,095 1,050 1,013 1,018 9
Slide 24: Non-GAAP Reconciliation (By Year)
N o n - G A A P R e c o n c i l i a t i o n ( B y Ye a r ) At or for the Years Ended December 31, December 31, (in thousands) 2024 2023 Total non-interest income $ 48,414 $ 42,782 Adj: Net (gains) on sale of business operations and assets (16,241) - Adj: Loss on sale of securities 49,937 25,057 Tota
Slide 25: Non-GAAP Reconciliation (By Year Continued and Notes)
N o n - G A A P R e c o n c i l i a t i o n ( B y Ye a r C o n t i n u e d a n d N o t e s ) At or for the Years Ended December 31, December 31, 2024 2023 Total average assets (F) $ 11,683 $ 11,838 Total average shareholders' equity (G) 1,044 984 Total average tangible shareholders' equity (1) (I) 1
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