Pcb Bancorp · NASDAQ:PCB
Pcb Bancorp — Q2 2020 Earnings Presentation
29 slides from Pcb Bancorp's earnings presentation, Jul 23, 2020
Slide 1: Earnings Results Second Quarter 2020
Earnings Results Second Quarter 2020 July 23, 2020
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation (and oral statements made regarding the subject of this presentation) contains certain “forward- looking statements” that are based on various facts and derived utilizing numerous important assumptions and are subject to known and unknown risks, uncertainties
Slide 3: Introduction
Introduction your Partner • Choice • Bank | 3
Slide 4: Franchise Footprint
Franchise Footprint • Servicing 7 of top 10 Korean-American MSAs in the U.S. through our branches and LPOs (1) (1) Based on total population projected for 2018 by S&P Global Market Intelligence. your Partner • Choice • Bank | 4
Slide 5: Equity Information
Equity Information As of July 17, 2020 Ticker PCB Market Cap $145 million Price Per Share $9.40 52 Week Range $7.97 - $17.55 Dividend Yield (Dividend Payout Ratio) 4.26% (29.8% 3Q19-2Q20) Number of Shares 15,377,935 Historical Quarterly Cash Dividend Per Share 0.120 0.100 25% 0.080 33% 20% 0.060 $0.
Slide 6: Historical Performance
Historical Performance Held-For-Investment Loans ($bn) Deposits ($bn) 1.800 CAGR +14.5% 1.800 CAGR +12.0% 1.600 1.600 1.400 1.400 1.200 1.200 1.000 1.000 0.800 0.800 $1.65 $1.55 $1.48 $1.34 $1.45 $1.44 0.600 0.600 $1.25 $1.19 $1.09 $1.03 $0.94 0.400 $0.84 0.400 0.200 0.200 0.000 0.000 2015 2016 2017
Slide 7: Historical Performance
Historical Performance Return on Average Assets Return on Average Equity 0.018 0.160 0.016 0.140 0.014 0.120 0.012 0.100 0.010 0.080 0.008 1.53% 14.26% 1.40% 0.060 13.10% 12.47% 12.00% 0.006 1.25% 1.25% 1.22% 10.88% 0.040 0.004 0.75% 6.17% 0.020 0.002 0.000 0.000 2015 2016 2017 2018 2019 06/20 YTD 2
Slide 8: COVID-19 Update
COVID-19 Update As of June 30, 2020 o SBA PPP Loans • 1,551 loans with aggregated contractual loan balance of $137.8 million • Origination fee income of $5.6 million and cost of $1.1 million o Loan Modification Related to COVID-19 • 467 customers for aggregated loan balance of $484.0 million o SBA P
Slide 9: Recent Financial Performance
Recent Financial Performance your Partner • Choice • Bank | 9
Slide 10: 2Q20 Highlights
2Q20 Highlights As of or For the Quarter Ended o Recorded a provision for loan losses ($ in thousands except per share data) 06/30/20 03/31/20 06/30/19 of $3.9 million in 2Q20 primarily due Income Statement Summary: to an increase in the economic Interest Income $ 18,973 $ 21,660 $ 24,030 uncertaint
Slide 11: Loan Overview
Loan Overview HFI Loan Trend HFI Loan Composition ($ in millions) June 30, 2020 Other Commercial Residential Consumer and Industrial SBA PPP Property YoY +7.1% 1% 14% 9% 14% 1,800 Commercial $1,554 Commercial 1,600 Property - Non- Property - $1,451 $1,451 Owner Owner $1,396 $1,390 $134 Occupied Occu
Slide 12: Loan Interest Rate Mix
Loan Interest Rate Mix New Production(1),(2) by Rate Type Interest Rate Mix(2) ($ in millions) June 30, 2020 6.31% 200.0 6.02% 5.91% 5.92% Variable (WA Rate: 4.11%) 5.52% 6.00% 53% 180.0 5.20% 5.20% 5.00% Fixed (WA Rate:5.10%) 160.0 4.15% 32% Hybrid (WA Rate: 4.99%) 4.00% 15% 140.0 $87 3.00% 120.0 $
Slide 13: SBA PPP Loans
SBA PPP Loans Summary of SBA PPP loans as of June 30, 2020: Unpaid Principal Balance (“UPB”) Remaining Balance of ($ in thousands) # of Loans Carrying Value 2-Year Maturity 5-Year Maturity Origination Fee Origination Cost $150K or Under 1,338 $ 49,363 $ 49,651 $ 1,143 $ 2,296 $ 862 Between $150K and
Slide 14: Loan Modification
Loan Modification Summary of loans with modifications related to the COVID-19 pandemic as of June 30, 2020: Carrying Value Weighted-Average Payment Accrued Interest ($ in thousands) Deferment Interest Only Total Interest Rate Loan-to-Value (1) Receivable Commercial property $ 369,716 $ 9,850 $ 379,5
Slide 15: Credit Quality
Credit Quality Non-Performing Assets (“NPAs”) NPAs to Total Assets 6.0 ($ in millions) 0.30% 5.0 0.25% 4.0 0.20% 3.0 0.15% $4.8 0.25% 0.24% 2.0 $4.5 0.10% $2.8 0.16% 1.0 $1.7 $1.8 $1.8 0.05% 0.09% 0.10% 0.11% 0.11% $1.6 $1.1 0.06% 0.0 0.00% Sep-18 Dec-18 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Jun-20 Sep
Slide 16: Loan Concentration
Loan Concentration Real Estate Loans – Commercial By Property Type Total Loans With Modification Related to COVID-19 % to Carrying Carrying Property ($ in thousands) Value % to Total LTV(1) Value % to Total Type Total LTV(1) Retail (More Than 50%) $ 179,072 18.7% 50.8% $ 87,741 23.1% 49.0% 46.5% Ind
Slide 17: Loan Concentration
Loan Concentration Commercial and Industrial Loans – By Industry Type Total, Excluding Loans with Modification SBA PPP Loans Related to COVID-19 SBA PPP Loans % to Carrying Carrying Industry Carrying ($ in thousands) Value % to Total Value % to Total Type Total Value % to Total General Manufacturing
Slide 18: Loan Concentration
Loan Concentration Geographic Concentration Commercial & Industrial, Real Estate - Commercial Real Estate – Residential Excluding SBA PPP SBA PPP Carrying Carrying Carrying Carrying ($ in thousands) Value % to Total Value % to Total Value % to Total Value % to Total California $ 801,634 83.7% $ 217,
Slide 19: Credit Quality vs. Peers
Credit Quality vs. Peers(1) NPAs / (Total Loans + OREO)(2) Classified Assets to Total Assets(3) June 30, 2020 June 30, 2020 1.40% Peer Information as of March 31, 2020 Peer Information as of March 31, 2020 2.00% 1.88% 1.20% 1.15% 1.80% 1.57% 0.99% 1.60% 1.00% 1.40% 0.83% 0.79% 0.80% 1.20% 1.14% 1.00
Slide 20: Deposit Overview
Deposit Overview Deposit Trend Deposit Composition ($ in millions) June 30, 2020 Internet Time YoY +11.3% Retail Time Deposits Deposits 1,800 32% 2% Retail Other Interest- $1,647 State and Brokered Bearing 1,600 Deposits $1,479 $1,477 $172 22% Noninterest $1,420 $1,444 $1,448 $1,447 $1,432 10% $37 D
Slide 21: Maturity Schedule
Maturity Schedule Time Deposits State and Brokered Retail Time Deposits Internet Time Deposits Time Deposits Total ($ in thousands) Amount WA Rate Amount WA Rate Amount WA Rate Amount WA Rate Less Than 3 Month $ 144,741 2.10% $ 5,216 0.65% $ 110,000 0.43% $ 259,957 1.36% 3 to 6 Month 101,220 1.80% 6
Slide 22: Profitability
Profitability 15.0 Net Income & PTPP(1) Income Diluted EPS & Adjusted Diluted EPS(1) 13.0 ($ in millions) 11.0 $10.0 $10.0 $0.66 $0.63 $9.8 $9.3 $9.8 $9.6 $0.61 $0.60 $0.59 $8.6 $0.57 $0.56 9.0 $8.0 $0.51 7.0 5.0 3.0 $6.5 $6.7 $6.6 $6.6 $6.8 $0.44 $0.41 $0.40 $0.40 $0.42 $4.2 $3.6 $3.4 $0.26 $0.23 $
Slide 23: Noninterest Income
Noninterest Income Noninterest Income Trend SBA Loan Sale Trend ($ in millions) ($ in millions) 5.0 70% 9.1% 9.3% 65.00 8.3% 7.4% 7.6% 9.0% 7.5% 6.2% 10.0% 62% 62% 55.00 5.0% 4.5 45.00 6.8% 6.5% 0.0% 60% 5.7% 5.2% 5.3% 6.0% 5.3% 55% 35.00 4.0% -5.0% 4.0 51% 51% 25.00 -10.0% 48% 15.00 $29.2 50% $23.1
Slide 24: Noninterest Expense
Noninterest Expense Noninterest Expense Trend Efficiency Ratio(2) ($ in millions) 64.7% 70.00% 61.7% 61.8% 62.4% 62.5% 61.9% 62.1% 16.0 60.00% 3.00% 50.00% 40.00% 14.0 2.52% 2.48% 2.43% 2.43% 2.40% 30.00% 2.39% 2.50% 2.35% 49.3% 50.4% 52.6% 53.0% 53.0% 50.7% 56.8% 53.0% 20.00% 12.0 10.00% 1.98% 0.00
Slide 25: Net Interest Margin
Net Interest Margin Yield & Cost(1) 7.00% 6.34% 6.33% 6.39% 6.10% 6.22% 5.85% 6.00% 5.64% 5.00% 4.73% 4.33% 4.17% 4.22% 4.17% 4.11% 3.96% 3.85% 4.00% 3.22% 3.00% 2.06% 2.17% 2.13% 1.89% 1.99% 2.00% 1.72% 1.77% 1.17% 1.69% 1.62% 1.64% 1.53% 1.00% 1.47% 1.32% 1.34% 0.85% 0.00% 3Q18 4Q18 1Q19 2Q19 3Q19
Slide 26: Capital Ratios & BV Per Share
Capital Ratios & BV Per Share Bank Regulatory Capital Ratios 15.00 BV Per Share 18.00% June 30, 2020 14.50 14.00 16.00% 13.50 $14.78 13.00 14.00% $14.58 $14.30 $14.44 $13.98 12.50 $13.57 $13.16 12.00% 12.00 $12.71 11.50 10.00% Sep-18 Dec-18 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Jun-20 16.83% 8.00% 15.5
Slide 27: Non-GAAP Measures
Non-GAAP Measures Core Deposits Core Deposits are a non-GAAP measure that we use to measure the portion of our total deposits that are thought to be more stable, lower cost and reprice less frequently on average in a rising rate environment. We calculate core deposits as total deposits less time dep
Slide 28: Non-GAAP Measures
Non-GAAP Measures The following table reconciles core deposits to total deposits to its most comparable GAAP measure: ($ in thousands) 09/30/18 12/31/18 03/31/19 06/30/19 09/30/19 12/31/19 03/31/20 06/30/20 Total Deposits $ 1,419,526 $ 1,443,753 $ 1,447,758 $ 1,446,526 $ 1,432,262 $ 1,479,307 $ 1,47
Slide 29: Non-GAAP Measures
Non-GAAP Measures The following table reconciles PTPP income, and adjusted ROAA, ROAE and diluted EPS for PTPP to their most comparable GAAP measures: ($ in thousands) 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 Net Income (a)$ 6,543 $ 6,732 $ 6,564 $ 6,601 $ 6,785 $ 4,158 $ 3,572 $ 3,367 Add: Provision