Stellar Bancorp, Inc. · NYSE:STEL
Stellar Bancorp — Q4 2022 Earnings Presentation
16 slides from Stellar Bancorp's earnings presentation, Jan 27, 2023
Slide 1: Fourth Quarter 2022 Earnings Presentation
Fourth Quarter 2022 Earnings Presentation Exhibit 99.2
Slide 2: Forward-Looking Statements and Non-GAAP Financial Measures
Forward-Looking Statements and Non-GAAP Financial Measures 2 Certain statements in this presentation which are not historical in nature are intended to be, and are hereby identified as, “forward-looking statements” for purposes of the safe harbor provided by Section 27A of the Securities Act of 1933
Slide 3: Stellar Bancorp, Inc. - Snapshot
3 (1) Refer to the calculation of this non-GAAP financial measure and a reconciliation to its most directly comparable GAAP financial measure in the appendix. Stellar Bancorp, Inc. - Snapshot Combination of the Houston region’s two largest regionally-focused banks Combination delivers scale, growt
Slide 4: Financial Highlights – Fourth Quarter 2022
4 Financial Highlights – Fourth Quarter 2022 (1) Refer to the calculation of these non-GAAP financial measures and a reconciliation to their most directly comparable GAAP financial measures in the appendix. (2) Adjusted results exclude acquisition and merger-related expenses, core deposit intangible
Slide 5: Merger Related Accounting Adjustments
Merger Related Accounting Adjustments(1) 5 • Purchase accounting mark on acquired loans of $166.5 million (5.31% of legacy CBTX loan portfolio) • $9.3 million allocated to purchase credit deteriorated (PCD) loans • $157.2 million allocated to non-PCD loans • Core deposit intangible of $138.2 million
Slide 6: Core PTPP Earnings Power
Core PTPP Earnings Power 6 (1) Non-GAAP financial measure. (2) Adjusted results exclude the impact of acquisition and merger-related expenses, core deposit intangibles amortization, purchase accounting adjustments and the net gain on sale of assets for the period presented. (3) Annualized. After exc
Slide 7: Fourth Quarter Loan Summary
C & I 19.0% Cons. & Other 0.6% 1-4 Fam. 12.9% C&D 16.8%Multi. 5.7% OO CRE 23.2% CRE 21.8% Fourth Quarter Loan Summary 7 (1) Refer to the calculation of these non-GAAP financial measures and a reconciliation to their most directly comparable GAAP financial measures in the appendix. Note: Combined rep
Slide 8: Fourth Quarter Deposit Summary
Fourth Quarter Deposit Summary 8 Deposit MixDeposits (in millions) High Quality Deposit Funding: • 45.6% Noninterest bearing deposits • Core Funded Balance Sheet • 83.7% Loan / Deposit Ratio NIB 45.6% IB Demand 17.2% Sav. & MMDA 27.8% CD's 9.4% Combined Q3 2022 Q4 2022 Cost of Deposits 0.28% 0.62% C
Slide 9: Fourth Quarter Asset Quality Summary
Fourth Quarter Asset Quality Summary Strong credit quality metrics Q4 2022 NCOs totaled $5.7 million $4.6 million of Q4 charges related to the proactive sale of $35.4 million of loans Adj. NCOs / Avg. Loans(1) was 0.06% NCOs for the combined company would have totaled $6.1 million(2) for t
Slide 10: Regulatory Capital Ratios
Regulatory Capital Ratios(1) 10 Adequately Well Capitalized Capitalized Bank Capital Ratios CET 1 Ratio 10.46% 4.50% 6.50% Tier 1 Capital Ratio 10.46% 6.00% 8.00% Total Capital Ratio 12.10% 8.00% 10.00% Tier 1 Leverage Ratio 8.81% 4.00% 5.00% Consolidated Capital Ratios TCE / TA(2) 7.24% N/A N/A CET
Slide 11: Key Takeaways
11 Key Takeaways Excellent core funding profile Merger scale brings strong combined earnings power Key success factor for 2023: risk management Significant financial flexibility Positioned for rapid capital-build
Slide 12: Unparalleled Market Focus
Unparalleled Market Focus Total Assets Houston Region(1) Percent of Company Name ($B) Deposits ($B) Deposits (%) JPMorgan $3,841 $188.0 7.6% Wells Fargo 1,881 34.3 2.4% BofA 3,112 29.7 1.5% Zions 87.8 14.1 17.8% PNC 541 11.9 2.7% Stellar 11.1 9.5 98.1% Frost 51.8 8.4 18.4% Capital One 440 8.0 2.6% C
Slide 13: Headquartered in 4th Largest City in the US
Headquartered in 4th Largest City in the US 5-Year Historical Population Growth (2017-2022) STRONG AND DIVERSIFIED HOUSTON REGION Houston has the second highest concentration of Fortune 1000 companies in the U.S. The Port of Houston ranked #1 in the U.S. in 2021 foreign waterborne tonnage Houston is
Slide 14: Strong Combined Market Share Growth In Competitive Texas Markets
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Slide 15: Appendix: Non-GAAP Reconciliation
Appendix: Non-GAAP Reconciliation(1) 15 (1) See the disclosure under the heading “GAAP Reconciliation of Non-GAAP Financial Measures” on slide 2 regarding the use of non-GAAP financial measures. (2) Annualized. Q4 2022 Net income $ 2,052 (+) Provision for credit losses 44,793 (+) Provision for incom
Slide 16: Be Stellar.
ol, Be Stellar. NASDAQ: STEL stellar BANCORP, INC. 16