Atlantic Union Bankshares Corporation · NYSE:AUB
Atlantic Union Bankshares — Merger or Acquisition (October 2024)
30 slides from Atlantic Union Bankshares's merger presentation, Oct 21, 2024
Slide 1: Completing the “Golden Crescent”
Completing the “Golden Crescent” Merger Investor Presentation NYSE: AUB October 21, 2024
Slide 2: Disclaimer and Caution About Forward-Looking Statements
Disclaimer and Caution About Forward-Looking Statements THE INFORMATION CONTAINED IN THIS PRESENTATION IS CONFIDENTIAL INFORMATION. ACCORDINGLY, THE INFORMATION INCLUDED HEREIN MAY NOT BE REFERRED TO, QUOTED OR OTHERWISE DISCLOSED BY YOU. IN REVIEWING THIS INFORMATION, YOU ARE ACKNOWLEDGING THE CONF
Slide 3: Additional Information
Additional Information Important Additional Information and Where to Find It Union by accessing Atlantic Union’s website at https://investors.atlanticunionbank.com or from Sandy Spring by accessing Sandy Spring’s website at In connection with the proposed transaction, Atlantic Union intends to file
Slide 4: Additional Information
Additional Information Sandy Spring Data Non-GAAP Financial Measures Unless otherwise indicated, data about Sandy Spring provided in this presentation, This presentation includes certain financial measures derived from consolidated financial including financial information, has been obtained from Sa
Slide 5: Overview of Sandy Spring Acquisition
Overview of Sandy Spring Acquisition Transaction Solidifies Position as a Preeminent Regional Bank Pro Forma Combined $39Bn $32Bn $30Bn $13Bn 182 $5.5Bn Company by the Numbers in Assets in Deposits in Loans of Wealth AUM Branches Market Cap Financially Compelling Acquisition (1) Expanding Mid-Atlant
Slide 6: The Transaction Will Enhance Our Shareholder Value Proposition
The Transaction Will Enhance Our Shareholder Value Proposition Shareholder Value Proposition Sandy Spring’s Impact • Enhances presence in attractive Mid-Atlantic markets throughout Washington D.C. and Baltimore MSAs ✓ Leading Regional Presence Dense, uniquely valuable presence • 156 year-old custome
Slide 7: Transaction Highlights
Transaction Highlights Shareholder Value Proposition Pro Forma Company (1) Leading Regional Presence $11.7Bn 182 #1 Dense, uniquely valuable presence Deposits Added in Northern Virginia, Largest Regional Bank across attractive markets Pro Forma Branches Maryland and Washington D.C. in Mid-Atlantic (
Slide 8: Overview of Sandy Spring
Overview of Sandy Spring Key Franchise Highlights Financial Snapshot President, CEO & Chair of the Board Daniel Schrider Assets ($Bn) $14.4 Headquarters Olney, Maryland Gross Loans ($Bn) $11.5 Branches 53 Deposits ($Bn) $11.7 Ticker SASR CET1 Ratio (%) 11.3% Year Founded 1868 Reserves / Loans (%) 1.
Slide 9: Enhancing & Expanding our Presence in Key Mid-Atlantic Markets
Enhancing & Expanding our Presence in Key Mid-Atlantic Markets Pro Forma Franchise Footprint (1) Attractive Market Presence (1) Atlantic Union: 129 Branches Atlantic Union: 3 LPOs Sandy Spring: 53 Branches Maryland 182 $32Bn 20 Pro Forma Pro Forma Pro Forma MSAs of Branches Deposits Operation Virgin
Slide 10: Sandy Spring Completes the “Golden Crescent”
Sandy Spring Completes the “Golden Crescent” Completing What Atlantic Union Outlined in 2018 – Investor Day Future M&A Goals Snapshot from 2018 Investor Day Presentation Completing the Golden Crescent Total Assets, ($Bn) CAGR: +15% 39.2 Pro Forma with Sandy Spring’s CAGR = +22% 14.4 24.3 19.6 20.1 2
Slide 11: Transaction Structure & Terms
Transaction Structure & Terms • 0.90 shares of Atlantic Union common stock to be exchanged for each share of Sandy Spring common stock Structure and • At closing, Sandy Spring will merge with and into Atlantic Union Exchange Ratio • Pro forma ownership will include ~63% AUB shareholders / ~29% SASR
Slide 12: Key Transaction Assumptions
Key Transaction Assumptions • Cost savings of approximately 27% of Sandy Spring’s annual operating expense Cost Savings & ‒ 50% phase-in during second half 2025 (25% for full year) and 100% in 2026 and thereafter Merger Costs • $115MM of after-tax one-time merger expenses; fully reflected in pro for
Slide 13: Estimated Pro Forma Financial Metrics
Estimated Pro Forma Financial Metrics Key Transaction Impacts to Atlantic Union (1) Pro Forma Capital at Close (1) AUB M&A Pro Forma Pro Forma Metrics AUB Bank EPS Accretion (2026E) Immediately Accretive to Earnings 23% ✓ Tangible Common Equity Ratio 7.5% 9.7% Common Equity Tier 1 Ratio 10.0% 12.4%
Slide 14: Top Quartile Pro Forma Profitability Profile Relative to Peers
Top Quartile Pro Forma Profitability Profile Relative to Peers (1) (2) Illustrative Performance Assuming Net Pro Forma Impacts Top Quartile Median Return on Avg. Assets (2026E) 1.50 +31bps 1.28 1.19 1.15 HOMB OZK AX EWBC CBSH AUB PF PB ABCB SSB UMBF UBSI HWC Top Quartile WBS CATY WSF S PNFP AUB ONB
Slide 15: Balance Sheet & Capital Position Improve on Pro Forma Basis
Balance Sheet & Capital Position Improve on Pro Forma Basis Taking Prudent Actions to Strengthen Below Regulatory Guideline CRE / Total Capital (1) Improvement to Loan-to-Deposit Ratio (%, Bank Level) (%) Pro Forma Balance Sheet ~(10)% pts ~(3)% pts 90% 295% 285% CRE Loan Sale Up to $2.0Bn Achieves
Slide 16: Robust Ongoing Capital Generation
Robust Ongoing Capital Generation Pro Forma Combined Earnings & Accretion of Interest Rate / Capital Ratios At Close Cost Savings Fair Market Value Adjustments AUB Stand-Alone Earnings (1) $313 10.0% 8.9% SASR Stand-Alone Earnings (1) $150 ~$364MM Other Impacts to Earnings $(21) CET1 Leverage accret
Slide 17: Comprehensive Due Diligence Process
Comprehensive Due Diligence Process ✓ Utilized Atlantic Union’s historical M&A experience and established a diligence team consisting of over 50 team members ✓ Leveraged our team of professionals across our business functions to review documents and conduct diligence sessions with Sandy Spring busin
Slide 18: Combination Provides Benefits to the Communities We Serve
Combination Provides Benefits to the Communities We Serve Creating a Bank Best Equipped $9.5Bn Community Impact Plan Over the Next 5 Years to Serve All of Our Communities to Help Strengthen Economic Growth and Financial Access Combined Cultures Committed to Community Care (1) 13K+ $268MM $229MM 650+
Slide 19: Combination is Beneficial to All Stakeholders
Combination is Beneficial to All Stakeholders Customers Shareholders • Provides a platform for further expansion and diversification • Significant estimated earnings accretion and short projected TBV earnback period • Greater capabilities and expanded product suite • Benefits of synergies accrue to
Slide 20: Enhancing Our Shareholder Value Proposition
Leading Strong Attractive Financial Peer-Leading Regional Growth Financial Strength Performance Presence Potential Profile Enhancing Our Shareholder Value Proposition 20
Slide 21: Appendix
Appendix d Atlantic Union Bankshares
Slide 22: Sandy Spring Substantially Completes “Golden Crescent” Strategy
Sandy Spring Substantially Completes “Golden Crescent” Strategy Experiencing Both Organic Growth and M&A Growth Since 2017 2017: Beginning of the Golden Crescent Current: Completing the Golden Crecent – Pro Forma Geographic Summary with Sandy Spring (Q2’2017) (Current and Pro Forma with Sandy Spring
Slide 23: Creates #1 Regional Bank Deposit Franchise in Virginia and Maryland
Creates #1 Regional Bank Deposit Franchise in Virginia and Maryland Summary of Sandy Spring Retail Deposit Market Share (1) (2) Pro Forma Reg. DMS Market Deposits Branches Reg. Rank DMS Rank Deposits Branches Reg. Rank DMS Rank Deposits Branches Rank Rank Share ($MM) (#) (#) (#) ($MM) (#) (#) (#) ($
Slide 24: Pro Forma Loan and Deposit Mix
Pro Forma Loan and Deposit Mix Sandy Spring Atlantic Union Pro Forma w/ Up to $2Bn Loan Sale (1) Other Cons. C&D Auto Other Cons. C&D AutoOther Cons. C&D 4% 1 - 4 Resi 1% 1 - 4 Resi 1% 2% 11% 2% 9% 8% 1 - 4 Resi 8% 11% 14% 1 - 4 Family Cons. OO-CRE OO-CRE OO-CRE 13% 1 - 4 Family Cons. 7% 15% 15% 4%
Slide 25: Sandy Spring: Overview of CRE Loan Portfolio
Sandy Spring: Overview of CRE Loan Portfolio CRE Portfolio by Collateral Type (1) Overview of CRE Office Portfolio Other Misc. 18% $774MM 276 $2.8MM Total CRE Office Balance Loans Avg. Loan Balance Retail 28% Hotel 5% 12.0% 0.0% 16.1% Rate Change in 12 Months Non-Performing Loans Maturing in 12 Mont
Slide 26: History of Strong Credit Quality
History of Strong Credit Quality Both Franchises Have a History of Prudent Conservative Underwriting NCOs / Average Loans (%) Most Recent Quarter 5 Year Avg 10 Year Avg 0.17% 0.12% 0.12% 0.09% 0.07% 0.04% 0.03% 0.04% 0.03% 0.01% 0.01% (1) (1) Q3’24 (2) AUBQ2’24 Q3’24 SASR (2) Q2’24 Regional Q2’24 Ba
Slide 27: Sandy Spring’s Attractive Fee Income Driven by Strong Wealth Business
Sandy Spring’s Attractive Fee Income Driven by Strong Wealth Business Pro Forma Enhancement to Fee Income Ratio and Emphasis on High-Quality Wealth Management Revenue (3Q’24 Fee Income Composition, %) (3Q’24 Fee Income Composition, %) (1) (3Q’24 Fee Income Composition, %) Other Income Service Charge
Slide 28: Pro Forma Net Income and EPS Reconciliation
Pro Forma Net Income and EPS Reconciliation Dollar values in millions, except per share amounts Earnings per Share Goodwill Reconciliation 2026E Pro Forma Sandy Spring Tangible Book Value at Closing 1,275 Atlantic Union Net Income to Common (Consensus) $313.0 Pre-Tax Fair Value Adjustments (647) San
Slide 29: Pro Forma Tangible Book Value Reconciliation
Pro Forma Tangible Book Value Reconciliation Values in dollars per share Build-Up of Pro Forma Tangible Book Value Per Share (1) 21.05 1.17 19.87 19.62 0.88 0.29 19.33 18.99 1.25 0.63 18.36 AUB at Close Net Merger Pro Forma Full One-Time Pro Forma Day 2 CECL Non- Pro Forma Equity Pro Forma CRE Pro F
Slide 30: Non-GAAP Reconciliations
Non-GAAP Reconciliations Tangible assets and tangible common equity are used Q3'24 Tangible Assets and Tangible Common Equity in the calculation of certain profitability, capital, and per share ratios. The Company believes tangible Atlantic Union Sandy Spring assets, tangible common equity and the r
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