Bank Of N.t. Butterfield & Son Limited (the) Voting · NYSE:NTB
Bank Of N.t. Butterfield & Son Limited (the) Voting — Bank of N.T. Butterfield & Son Limited (The) — Q3 2024 Earnings Presentation
25 slides from Bank Of N.t. Butterfield & Son Limited (the) Voting's earnings presentation, Oct 23, 2024
Slide 1: Third Quarter 2024 Earnings Presentation
Third Quarter 2024 The Bank of N.T. Butterfield & Son Limited Earnings Presentation October 23, 2024
Slide 2: Forward-Looking Statements
Forward-Looking Statements Forward-Looking Statements: Certain of the statements made in this release are forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements with respect to our beliefs, plans, obje
Slide 3: Agenda and Overview
Agenda and Overview Presenters Agenda Butterfield Overview Michael Collins • Overview • Leading Bank in Attractive Markets Chairman and Chief Executive Officer • Third Quarter 2024 Financials • Strong Capital Generation and Return Craig Bridgewater • Q&A • Resilient, Capital Efficient, Diversified F
Slide 4: Third Quarter 2024 Highlights
Third Quarter 2024 Highlights • Net income of $52.7 million, or $1.16 per share (In US$ millions) vs. Q2 2024 vs. Q3 2023 • Core net income** of $52.8 million, or $1.16 per share Q3 2024 $ % $ % • Return on average common equity of 20.3%; core return on Net Interest Income $ 88.1 $ 0.6 $ (2.1) avera
Slide 5: Financials
Financials
Slide 6: Income Statement: Net Interest Income
Income Statement Net Interest Income Net Interest Margin & Yields Net Interest Income before Provision for Credit Losses -Trend (In US$ millions) Q3 2024 vs. Q2 2024 (In US$ millions) Avg. Balance Yield Avg. Balance Yield Cash, S/T Inv. & Repos $ 3,572.7 4.66 % $ 103.9 (0.12)% $90.2 $87.4 $88.1 Inve
Slide 7: Income Statement: Non-Interest Income
Income Statement Non-Interest Income Non-Interest Income Trend (In US$ millions) (In US$ millions) Q3 2024 vs. Q2 2024 $55.6 $56.0 Asset management $ 9.5 $ 0.6 $52.0 Banking 14.4 0.6 Foreign exchange revenue 12.2 (0.4) Trust 15.8 0.3 Custody and other 3.5 0.1 Other 0.7 (0.9) Total Non-Interest Incom
Slide 8: Income Statement: Non-Interest Expenses
Income Statement Non-Interest Expenses Core Non-Interest Expense* Trend Core Non-Interest Expenses* vs. Q2 2024 (In US$ millions) (In US$ millions) Q3 2024 $ % $90.3 $88.6 $84.3 Salaries & Benefits** $ 44.7 $ — (0.1)% Technology & Comm. 16.5 (0.4) (2.3)% Professional & O/S Services 4.7 (1.4) (22.7)%
Slide 9: Balance Sheet
Balance Sheet Total Assets vs Q4 2023 (In US$ millions) Q3 2024 Q4 2023 % (In US$ billions) Cash and cash equivalents $ 2,067 $ 1,647 26 % $14.4 $13.9 Reverse Repos & S/T Investments 1,750 1,225 43 % $13.2 Investments 5,468 5,292 3% Loans (net) 4,648 4,746 (2)% Other Assets 441 464 (5)% Total Assets
Slide 10: Asset Quality
Asset Quality Non-Accrual Loans Investment Portfolio (In US$ millions) $89.6 Loan Distribution Rating Distribution AAA 0.3% $70.0 Consumer $59.4 4.2% Res Mtg 69.1% Comm’l R/E 12.7% Other Comm’l 7.9% AA 99.7% Government 6.0% $4.6 $5.5 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Q3 2024 billion billion 0.20% • 69
Slide 11: Interest Rate Sensitivity
Interest Rate Sensitivity Average Balance - Balance Sheet Interest Rate Sensitivity Average Balances 5.7% (US$Mil) Weighted Average 3.5% 2.8% Life 1.4% Q3 2024 vs. Q2 2024 Duration vs. Q2 2024 Cash & Reverse Repos & S/T (1.3)% Invest. $ 3,572.7 $ 103.9 0.1 — N/A AFS 1,907.3 110.2 3.4 0.1 4.2 (5.0)%
Slide 12: Capital Requirements and Dividend Return
Capital Requirements and Dividend Return Regulatory Capital (Basel III) - Total Capital Ratio* Leverage Capital 10.2% 0.4% 7.9% 24.3% 1.1% 9.8% 6.8% 15.1% 13.5% Butterfield - Current US Peer Median*** Butterfield Current BMA Minimum US Peer Median*** TCE/TA TCE/TA Ex Cash Dividend Payout Ratio • Reg
Slide 13: Appendix
Appendix
Slide 14: Deposit Composition by Segment
Deposit Composition by Segment Group (US$ Billions) Bermuda (US$ Billions) $11.9 $12.0 $12.1 $12.5 $12.7 $4.5 $4.5 $4.5 $4.6 $4.6 30% 31% 33% 33% 34% 18% 22% 22% 21% 19% 45% 42% 46% 43% 45% 48% 47% 46% 47% 47% 37% 36% 35% 34% 34% 22% 22% 21% 20% 19% Q3 2023 Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q3 2023 Q4
Slide 15: Loans
Loans Residential Mortgage Loans (US$ Billions) Commercial Loans (US$ Billions) $3.4 $3.6 $3.6 $3.3 $3.2 $1.6 $1.4 $1.4 $1.3 $1.2 49% 50% 49% 49% 52% 49% 48% 46% 48% 48% 18% 21% 23% 22% 21% 18% 18% 21% 22% 23% 32% 5% 7% 9% 29% 29% 29% 27% 9% 10% 29% 26% 24% 21% 20% 2020 2021 2022 2023 Q3 2024 2020 2
Slide 16: Balance Sheet Asset Mix
Balance Sheet Asset Mix Liquidity: Cash & Cash Equivalents** to Total Assets Loan-to-Deposit Ratio 69% 71% 68% 68% 40% 40% 38% 27% 37% 37% 26% 24% 20% 21% 4% 4% 4% 3% Q3 2023 Q4 2023 Q1 2024 Q2 2024 Q3 2024 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Q3 2024 NTB US Peer Median* NTB US Peer Median* • Butterfield
Slide 17: Balance Sheet Movements
Balance Sheet Movements Deposit Movements (US$ millions) Deposit Composition by Currency (US$ billions) FX $11.9 $12.5 $12.7 Volume Translation 6% 6% 8% 19% 22% 21% Change vs Q2 +15 +175 $190 2024 75% 73% 72% Change vs Q4 +680 +120 $800 2023 Q3 2023 Q4 2023 Q1 2024 Q2 2024 Q3 2024 USD / USD Pegged G
Slide 18: Balance Sheet Trends
Balance Sheet Trends (in millions of US Dollars, unless otherwise indicated) 2024 2023 2022 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Assets Cash and cash equivalents $ 2,067 $ 2,390 $ 1,746 $ 1,647 $ 1,750 $ 1,795 $ 1,345 $ 2,101 $ 1,485 Reverse Repos & S/T Investments 1,750 1,289 1,480 1,225 893 729 1,263 944 99
Slide 19: Average Balance Sheet Trends
Average Balance Sheet Trends (in millions of US Dollars, unless otherwise indicated) Q3 2024 Q2 2024 Q3 2023 Average Interest Average rate Average Interest Average rate Average Interest Average rate Assets balance ($) ($) (%) balance ($) ($) (%) balance ($) ($) (%) Cash and cash equivalents, reverse
Slide 20: Income Statement Trends
Income Statement Trends (in millions of US Dollars, unless otherwise indicated) 2024 2023 2022 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Net Interest Income $ 88.1 $ 87.4 $ 87.1 $ 86.9 $ 90.2 $ 92.5 $ 97.4 $ 94.6 $ 91.2 Non-Interest Income 56.0 55.6 55.1 60.0 52.0 50.2 50.2 54.9 49.9 Prov. for Credit (Losses) Reco
Slide 21: Non-Interest Income & Expense Trends
Non-Interest Income & Expense Trends (in millions of US Dollars, unless otherwise indicated) 2024 2023 2022 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Non-Interest Income Asset Management $ 9.5 $ 8.9 $ 8.8 $ 8.3 $ 8.0 $ 8.2 $ 7.9 $ 7.4 $ 7.4 Banking 14.4 13.8 14.3 18.6 14.1 12.6 13.6 17.5 14.1 FX Revenue 12.2 12.6
Slide 22: Core Non-Interest Expense Trends
Core Non-Interest Expense* Trends (in millions of US Dollars, unless otherwise indicated) 2024 2023 2022 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Q4 Q3 Salaries & Benefits* $ 44.7 $ 44.7 $ 42.5 $ 46.2 $ 43.4 $ 42.6 $ 43.7 $ 44.7 $ 42.0 Technology & Comm. 16.5 16.9 16.1 17.2 16.0 14.9 13.9 14.3 14.3 Professional & O/S S
Slide 23: Non-GAAP Reconciliation
Non-GAAP Reconciliation (in millions of US Dollars, unless otherwise indicated) 2024 2023 Q3 Q2 Q1 Q4 Q3 Net income A $ 52.7 $ 50.6 $ 53.4 $ 53.5 $ 48.7 Non-core (gains), losses and expenses Non-core expenses Early retirement program, voluntary separation, redundancies and other non-core compensatio
Slide 24: Non-GAAP Reconciliation (continued)
Non-GAAP Reconciliation (continued) (in millions of US Dollars, unless otherwise indicated) 2024 2023 Q3 Q2 Q1 Q4 Q3 Tangible equity to tangible assets Shareholders' equity K $ 1,064.2 $ 999.1 $ 995.1 $ 1,003.6 $ 922.9 Less: goodwill and intangible assets (96.7) (94.4) (96.3) (98.9) (70.6) Tangible
Slide 25: Peer Group
Peer Group Our peer group includes the following banks, noted by their ticker symbols: • First Hawaiian, Inc. (FHB) • Trustmark Corporation (TRMK) • Bank of Hawaii Corporation (BOH) • International Bancshares Corporation (IBOC) • East West Bancorp, Inc. (EWBC) • Community Financial System, Inc. (CBU
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