Atlantic Union Bankshares Corporation · NYSE:AUB
Atlantic Union Bankshares — Q3 2023 Earnings Presentation
27 slides from Atlantic Union Bankshares's earnings presentation, Oct 19, 2023
Slide 1: 3rd Quarter 2023 Earnings Presentation
3rd Quarter 2023 Earnings Presentation NYSE: AUB October 19, 2023
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation and statements by our management may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are statements that include, without limitation, statements on slides entit
Slide 3: Additional Information
Additional Information Non-GAAP Financial Measures No Offer or Solicitation This presentation contains certain financial information determined by methods other This presentation does not constitute an offer to sell or a solicitation of an offer to buy than in accordance with generally accepted acco
Slide 4: Our Company
Our Company Soundness | Profitability | Growth Highlights ($bn) Branch/Office Footprint AUB (109) • Statewide Virginia footprint of 104 AUB LPO (2) $ 20.7 $ 15.3 branches in all major markets AUB Equipment Finance Headquarters (1) Assets Loans • #1 regional bank1 deposit market share in Virginia • S
Slide 5: Our Shareholder Value Proposition
Leading Regional Presence Dense, uniquely valuable presence across attractive markets Our Shareholder Value Proposition Attractive Financial Profile Financial Strength Solid dividend yield Solid balance sheet & payout ratio with & capital levels earnings upside Peer-Leading Strong Growth Performance
Slide 6: Q3 2023 Highlights and 2023 Outlook
Q3 2023 Highlights and 2023 Outlook Loan and Deposit Growth Operating Leverage Focus Positioning for Long Term • Customer deposit growth more than • ~5.2% adjusted revenue growth1 year • Restructured more than $200 million of funded loan growth in Q3 2023 over year securities portfolio in Q3 2023 fo
Slide 7: Loan and Deposit Betas
Loan and Deposit Betas Deposit Mix Shift Total Loan Beta1 $16,546 $16,412 $16,787 45% 39% 42% 44% 3Q 2023 Highlights 34% 5.62% 5.84% 5.35% 4.90% • Total deposits up 9.1% 4.20% 68% 74% (annualized) 75% • Mix shift into higher costing deposit products and higher deposit betas drove increased 32% cost
Slide 8: Non-Owner-Occupied CRE Portfolio at September 30, 2023
Non-Owner-Occupied CRE Portfolio at September 30, 2023 Non-Owner Occupied Non-Owner-Occupied Office CRE Non-Office CRE 5.2% 28.1% Non-Owner-Occupied CRE By Type $ in millions Total Outstandings % of Portfolio Multi Family $947 6.2% $15.3B Retail $852 5.6% Hotel/Motel B&B $804 5.3% Total Office $792
Slide 9: Non-Owner-Occupied Office CRE Portfolio at September 30, 2023
Non-Owner-Occupied Office CRE Portfolio at September 30, 2023 Medical vs Other Office Geographically Diverse Non-Owner Non Owner-Occupied Office Medical Offices Occupied Office Portfolio Portfolio Credit Quality 22% By Market ($ millions) Key Portfolio Metrics Carolinas $249 Avg. Office Loan ($ mill
Slide 10: Q3 2023 Financial Performance At-a-Glance
Q3 2023 Financial Performance At-a-Glance • Reported net income available to common shareholders for the third quarter of 2023 was $51.1 million or $0.68 per share, down $1.2 Summarized Income Statement million or $0.02 per share compared to the prior quarter, primarily 3Q2023 2Q2023 driven by: Net
Slide 11: Q3 2023 Allowance For Credit Loss and Provision for Credit Losses
Q3 2023 Allowance For Credit Loss (ACL) and Provision for Credit Losses Q3 Macroeconomic Forecast Allowance for Loan Reserve for Unfunded Allowance for Moody’s September 2023 Baseline Forecast: & Lease Losses Commitments Credit Losses • US GDP expected to average ~2.1% growth in 03/31/2023 $117MM $1
Slide 12: Q3 2023 Net Interest Margin
Q3 2023 Net Interest Margin Margin Overview Market Rates 3Q2023 2Q2023 3Q2023 2Q2023 Net interest margin (FTE)1 3.35% 3.45% EOP Avg EOP Avg Loan yield 5.84% 5.62% Fed funds 5.50% 5.43% 5.25% 5.16% Investment yield 3.42% 3.32% Prime 8.50% 8.43% 8.25% 8.16% Earning asset yield 5.39% 5.19% 1-month SOFR
Slide 13: Q3 2023 Noninterest Income and Noninterest Expense
Q3 2023 Noninterest Income and Noninterest Expense Noninterest Income Noninterest Expense ($ thousands) 3Q2023 2Q2023 ($ thousands) 3Q2023 2Q2023 Salaries and benefits $ 57,449 $ 62,019 Service charges on deposit accounts $ 8,557 $ 8,118 Occupancy expenses 6,053 6,094 Other service charges, commissi
Slide 14: Q3 2023 Loan and Deposit Growth
Q3 2023 Loan and Deposit Growth QTD Annualized Loan Growth ($ thousands) 3Q2023 2Q2023 Growth • At September 30, 2023, loans held for investment (net of deferred fees Commercial & Industrial $ 3,432,319 $ 3,373,148 7.0% and costs) totaled $15.3 billion, an increase of $216.7 million or 5.7% Commerci
Slide 15: Strong Capital Position at September 30, 2023
Strong Capital Position at September 30, 2023 Proforma including AOCI and Reported Regulatory HTM unrealized losses Capital Management Strategy Well Capitalized Atlantic Union Atlantic Atlantic Union Atlantic Union Atlantic Union capital management Capital Ratio Minimums Bankshares Union Bank Banksh
Slide 16: Financial Outlook
Financial Outlook1 Full Year 2023 Outlook versus FY 2022 1Key Economic Assumptions Loan and Deposit Growth Mid-single digits growth • Stabilizing Interest Rate environment Net Interest Income (FTE) Growth Mid-single digits growth • The Federal Reserve Bank fed funds rate holds at 5.50% for the rest
Slide 17: Appendix
Appendix d Atlantic Union Bankshares
Slide 18: Granular Deposit Base at September 30, 2023
Granular Deposit Base at September 30, 2023 Customer Deposit Granularity Top 15 Commercial Deposits by NAICS as of 9/30/2023 NAICS Code/Title % of Total Deposits 1 52 - Finance and Insurance 8.3% $108,000 $100,000 $98,000 2 54 - Professional, Scientific, and Technical Services 6.2% 3 53 - Real Estat
Slide 19: Liquidity Position at September 30, 2023
Liquidity Position at September 30, 2023 Total Liquidity Sources of $5.9 billion ~130% liquidity coverage ratio of uninsured/uncollateralized deposits of $4.5 billion ($ in millions) Discount Window (ex-Bank Term Funding Program) Fed Funds Lines $316 $737 Discount Window – Bank Term Funding Program
Slide 20: Securities Portfolio at September 30, 2023
Securities Portfolio at September 30, 2023 • As of September 30, 2023, total securities portfolio of $2.9 billion with a total unrealized loss of $604.3 Securities Balances million (in $Millions) • 71% of total portfolio in available-for-sale at an unrealized loss of $523.1 million Total AFS (fair v
Slide 21: Reconciliation of Non-GAAP Disclosures
Reconciliation of Non-GAAP Disclosures The Company has provided supplemental performance measures on a tax-equivalent, tangible, operating, adjusted, or pre-tax pre-provision basis. These non-GAAP financial measures are a supplement to GAAP, which is used to prepare the Company’s financial statement
Slide 22: Reconciliation of Non-GAAP Disclosures
Reconciliation of Non-GAAP Disclosures ADJUSTED OPERATING EARNINGS, OPERATING LEVERAGE, AND EFFICIENCY RATIO For the three months ended For the nine months ended 3Q23% Change (Dollars in thousands, except per share amounts) 3Q2023 2Q2023 3Q2022 3Q2023 3Q2022 Nine months ended YoY Adjusted operating
Slide 23: Reconciliation of Non-GAAP Disclosures
Reconciliation of Non-GAAP Disclosures The Company believes net interest income (FTE), NET INTEREST MARGIN total revenue (FTE), and total adjusted revenue (FTE), which are used in computing net interest For the three months ended margin (FTE), efficiency ratio (FTE) and adjusted (Dollars in thousand
Slide 24: Reconciliation of Non-GAAP Disclosures
Reconciliation of Non-GAAP Disclosures TANGIBLE ASSETS, TANGIBLE COMMON EQUITY, AND LEVERAGE RATIO As of September 30, 2023 Atlantic Union (Dollars in thousands, except per share amounts) Bankshares Atlantic Union Bank Tangible assets and tangible common equity are used in the calculation of certain
Slide 25: Reconciliation of Non-GAAP Disclosures
Reconciliation of Non-GAAP Disclosures All regulatory capital ratios at September 30, 2023 RISK-BASED CAPITAL RATIOS are estimates and subject to change pending the As of September 30, 2023 Company’s filing of its FR Y-9 C. In addition to Atlantic Union Atlantic Union these regulatory capital ratios
Slide 26: Reconciliation of Non-GAAP Disclosures
Reconciliation of Non-GAAP Disclosures OPERATING MEASURES Tangible assets and tangible common equity are For the three months ended used in the calculation of certain profitability, capital, (Dollars in thousands) 3Q2023 2Q2023 3Q2022 and per share ratios. The Company believes tangible assets, tangi
Slide 27: Reconciliation of Non-GAAP Disclosures
Reconciliation of Non-GAAP Disclosures Pre-tax pre-provision adjusted earnings excludes, PRE-TAX PRE-PROVISION ADJUSTED OPERATING EARNINGS as applicable, the provision for credit losses, For the three months ended For the nine months ended which can fluctuate significantly from period-to- (Dollars i
Atlantic Union Bankshares — Q3 2023 Earnings Presentation on 6ix