South Plains Financial, Inc. · NASDAQ:SPFI
South Plains Financial — Q2 2022 Earnings Presentation
22 slides from South Plains Financial's earnings presentation, Jul 22, 2022
Slide 1: South Plains Financial Second Quarter 2022 Earnings Presentation
South Plains Financial Second Quarter 2022 Earnings Presentation July 22, 2022
Slide 2: Safe Harbor Statement and Other Disclosures
Safe Harbor Statement and Other Disclosures FORWARD-LOOKING STATEMENTS This presentation contains, and future oral and written statements of South Plains Financial, Inc. (“South Plains” or the “Company” or “SPFI”) and City Bank (“City Bank” or the “Bank”) may contain, statements about future events
Slide 3: Today's Speakers
Today’s Speakers Curtis C. Griffith Chairman & Chief Executive Officer Elected to the board of directors of First State Bank of Morton, Texas, in 1972 and employed by it in 1979 Elected Chairman of the First State Bank of Morton board in 1984 Chairman of the Board of City Bank and the Company since
Slide 4: Second Quarter 2022 Highlights
Second Quarter 2022 Highlights Diluted earnings per share was $0.88 per share, an increase of 13% as compared to $0.78 per share in 1Q’22 Earnings growth primarily driven by a 20.8% annualized increase in loans HFI as compared to 1Q’22 as recently hired lenders ramp their loan portfolios combined wi
Slide 5: Loan Portfolio 2Q'22 Highlights
Loan Portfolio 2Q'22 Highlights Loans HFI increased $126.9 million from 1Q’22, primarily due to: $148.2 million organic net loan growth. Remains relationship-focused with largest growth in commercial real estate, residential mortgage loans, and consumer auto loans. SBA forgiveness and repayments of
Slide 6: Attractive Markets Poised for Organic Growth
Attractive Markets Poised for Organic Growth Note: Tangible book value per share is a non-GAAP measures. See appendix for the reconciliation to GAAP El Paso Basin Dallas / Ft. Worth1 Population of 865,000+ Adjacent in proximity to Juarez, Mexico’s growing industrial center and an estimated populatio
Slide 7: Metropolitan Loan Growth 2Q'22 Highlights
Metropolitan Loan Growth 2Q'22 Highlights Loans HFI in Dallas, Houston and El Paso totaled $819.4 million in 2Q’22 an increase of 28.0% from 1Q’22 Expansion of lending team across the Company’s MSA’s is driving accelerated loan growth Existing infrastructure in Dallas, Houston and El Paso can suppor
Slide 8: Loan HFI Portfolio and Loan Mix
Loan HFI Portfolio Loan Mix Loan Portfolio ($ in millions) 6/30/22 Commercial C&D $ 116.5 Residential C&D 256.5 CRE Owner/Occ. 264.7 Other CRE Non Owner/Occ. 462.5 Multi-Family 123.7 C&I 385.5 Agriculture 178.3 1-4 Family 407.9 Auto 299.7 Other Consumer 78.1 PPP 7.1 Total $ 2,580.5 Source: Company d
Slide 9: Indirect Auto Overview
Indirect Auto Overview Indirect Auto Highlights Total indirect auto loans increased $40.8 million in 2Q’22 to $280.4 million, compared to 1Q’22 Expanded footprint through the addition of several high quality auto dealerships Disciplined underwriting approach to selectively grow indirect auto lending
Slide 10: Mortgage Banking Overview
Mortgage Banking Overview Mortgage Banking Activity $ in Millions 2Q'22 Highlights Inflection point quarter as mortgage banking activity is moderating Mortgage loan originations decreased 12% in 2Q'22 compared to 1Q’22 Have aggressively managed the decline in volumes since the peak through expense a
Slide 11: Noninterest Income Overview
Noninterest Income Overview Noninterest Income $ in Millions 2Q'22 Highlights Mortgage banking revenues have largely moderated at 15% of total Bank revenues Noninterest income of $18.8 million, compared to $23.7 million in 1Q’22; this decline is primarily due to $5.0 million decrease in mortgage ban
Slide 12: Diversified Revenue Stream
Diversified Revenue Stream Six Months Ended June 30, 2022 Total Revenues $109.6 million Noninterest Income $42.5 million Source: Company documents 12
Slide 13: Net Interest Income and Margin
Net Interest Income and Margin Net Interest Income & Margin $ in Millions 2Q'22 Highlights Net interest income of $37.1 million, compared to $29.9 million in 1Q’22 2Q'22 net interest margin, calculated on a tax-equivalent basis (“NIM”), of 4.02% and an increase of 69 bps compared to 1Q’22: $66.7 mil
Slide 14: Deposit Portfolio
Deposit Portfolio Total Deposits $ in Millions 2Q'22 Highlights Total deposits of $3.43 billion at 2Q'22, a decrease of approximately $24 million from 1Q'22 Decrease was primarily due to large tax payments made during the quarter Cost of interest-bearing deposits increased in 2Q'22 to 42 bps from 34
Slide 15: Credit Quality
Credit Quality 2Q'22 Highlights Credit Quality Ratios The Company did not record a provision for loan losses in the second quarter of 2022, compared to a negative provision for loan losses of $2.1 million in 2Q’21 The Company continued to experience improving credit metrics in the loan portfolio dur
Slide 16: Investment Securities
Investment Securities 2Q'22 Highlights Investment Securities totaled $763.9 million at 6/30/2022, a decrease of $29.4 million from 1Q’22 All municipal bonds are in Texas All MBS, CMO, and Asset Backed securities are U.S. Government or GSE Duration – 6.87 years 2Q’22 yield – 2.19% 1Q'22 Securities Co
Slide 17: Noninterest Expense and Efficiency
Noninterest Expense and Efficiency Noninterest Expense $ in Millions 2Q'22 Highlights Noninterest expense for 2Q’22 decreased $1.9 million from 1Q’22 primarily due to: Lower mortgage commissions and other variable mortgage-based expenses due to the reduction in mortgage loan originations Partially o
Slide 18: Balance Sheet Growth and Development
Balance Sheet Growth and Development Balance Sheet Highlights $ in Millions Tangible Book Value Per Share Note: Tangible book value per share is a non-GAAP measure. See appendix for the reconciliation to GAAP Source: Company documents 18
Slide 19: Strong Capital Base
Strong Capital Base Tangible Common Equity to Tangible Assets Ratio Common Equity Tier 1 Ratio Tier 1 Capital to Average Assets Ratio Total Capital to Risk-Weighted Assets Ratio Source: Company documents Note: Tangible common equity to tangible assets is a non-GAAP measure. See appendix for the reco
Slide 20: SPFI's Core Purpose and Values Align
SPFI’s Core Purpose and Values Align: Centered on Relationship Based Business Our Core Purpose is: To use the power of relationships to help people succeed and live better HELP [ALL STAKEHOLDERS] SUCCEED Employees great benefits and opportunities to grow and make a difference. Customers personal
Slide 21: Appendix
South Plains Financial, Inc. Appendix
Slide 22: Non-GAAP Financial Measures
Non-GAAP Financial Measures Source: Company documents 22 As of and for the quarter ended June 30, 2022 March 31, 2022 December 31, 2021 September 30, 2021 June 30, 2021 Pre-Tax, Pre-Provision Income Net income $ 15,936 $ 14,278 $ 14,614 $ 15,190 $ 13,650 Income tax expense 4,001 3,527 3,631 3,716 3,
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