Atlantic Union Bankshares Corporation · NYSE:AUB
Atlantic Union Bankshares — Q4 2023 Earnings Presentation
27 slides from Atlantic Union Bankshares's earnings presentation, Jan 23, 2024
Slide 1: 4th Quarter and Full Year 2023 Earnings Presentation
4th Quarter and Full Year 2023 Earnings Presentation NYSE: AUB January 23, 2024
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) $ 21.2 $ 15.6 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: Q4 2023 and FY 2023 Highlights
Q4 2023 and FY 2023 Highlights Loan and Deposit Growth Operating Leverage Focus Positioning for Long Term • 9.1% annualized loan growth in Q4 2023 • ~2.8% adjusted revenue growth1 year • In 2023, restructured the Company’s and 8.2% for FY 2023 over year securities portfolio by ~$500mm in • ~1.8% adj
Slide 7: Loan and Deposit Betas
Loan and Deposit Betas Total Loan Beta1 Deposit Mix Shift 47% 45% $15,932 $16,787 $16,818 42% 44% 39% 2023 Highlights 5.84% 5.97% 5.62% 5.35% 4.90% • Total deposits up 5.6% 69% 75% 76% • Mix shift into higher costing deposit products and higher deposit betas drove increased 31% cost of deposits 25%
Slide 8: Q4 2023 Financial Performance At-a-Glance
Q4 2023 Financial Performance At-a-Glance • Reported net income available to common shareholders for the fourth quarter of 2023 was $53.9 million or $0.72 per share, up $2.9 million or $0.04 per share Summarized Income Statement compared to the prior quarter, primarily driven by: 4Q2023 3Q2023 • An
Slide 9: Q4 2023 Allowance For Credit Losses and Provision for Credit Losses
Q4 2023 Allowance For Credit Losses (ACL) and Provision for Credit Losses Q4 Macroeconomic Forecast Allowance for Loan Reserve for Unfunded Allowance for Moody’s December 2023 Baseline Forecast: & Lease Losses Commitments Credit Losses • US GDP expected to average ~1.7% growth in 12/31/2022 $111MM $
Slide 10: Q4 2023 Net Interest Margin
Q4 2023 Net Interest Margin Margin Overview Market Rates 4Q2023 3Q2023 4Q2023 3Q2023 Net interest margin (FTE)1 3.34% 3.35% EOP Avg EOP Avg Loan yield 5.97% 5.84% Fed funds 5.50% 5.50% 5.50% 5.43% Investment yield 3.80% 3.42% Prime 8.50% 8.50% 8.50% 8.43% Earning asset yield 5.59% 5.39% 1-month SOFR
Slide 11: Q4 2023 Noninterest Income and Noninterest Expense
Q4 2023 Noninterest Income and Noninterest Expense Noninterest Income Noninterest Expense ($ thousands) 4Q2023 3Q2023 ($ thousands) 4Q2023 3Q2023 Salaries and benefits $ 56,686 $ 57,449 Service charges on deposit accounts $ 8,662 $ 8,557 Occupancy expenses 6,644 6,053 Other service charges, commissi
Slide 12: Q4 2023 Loan and Deposit Growth
Q4 2023 Loan and Deposit Growth QTD Annualized • At December 31, 2023, LHFI totaled $15.6 billion, an increase of Loan Growth ($ thousands) 4Q2023 3Q2023 Growth $351.4 million or 9.1% (annualized) from the prior quarter, driven by an Commercial & Industrial $ 3,589,347 $ 3,432,319 18.2% increase in
Slide 13: Strong Capital Position at December 31, 2023
Strong Capital Position at December 31, 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 Banksha
Slide 14: Financial Outlook – AUB Standalone
Financial Outlook – AUB Standalone1,2 Full Year 2024 Outlook1,2 versus FY 2023 1Key Economic Assumptions Loan Growth Mid-single digits Deposit Growth Low single digits • Stabilized Interest Rate environment • The Federal Reserve Bank cuts the fed Net Interest Income (FTE) Mid-single digits growth fu
Slide 15: Appendix
Appendix d Atlantic Union Bankshares
Slide 16: Non-Owner-Occupied CRE Portfolio at December 31, 2023
Non-Owner-Occupied CRE Portfolio at December 31, 2023 Non-Owner Occupied Office CRE 5.0% Non-Owner-Occupied CRE By Type Non-Owner Occupied Non- $ in millions Total Outstandings % of Portfolio Office CRE 28.5% Multi Family $1,062 6.8% $15.6B Retail $875 5.6% $829 5.3% Total Hotel/Motel B&B Office $77
Slide 17: Non-Owner-Occupied Office CRE Portfolio at December 31, 2023
Non-Owner-Occupied Office CRE Portfolio at December 31, 2023 Medical vs Other Office Medical Office Geographically Diverse Non-Owner Non Owner-Occupied Office 23% Occupied Office Portfolio Portfolio Credit Quality By Market ($ millions) Key Portfolio Metrics Carolinas $245 Avg. Office Loan ($ millio
Slide 18: Granular Deposit Base
Granular Deposit Base Customer Deposit Granularity Period End Uninsured and Uncollateralized Deposits as a Percentage of Total Deposits ($ in Millions) $5,299 $4,922 $4,589 $4,492 $4,343 33% 28% 29% 26% 27% $101,000 $100,000 $98,000 $18,000 $19,000 $19,000 Q4 2022 Q3 2023 Q4 2023 Q4 2022 Q1 2023 Q2
Slide 19: Liquidity Position at December 31, 2023
Liquidity Position at December 31, 2023 Total Liquidity Sources of $5.2 billion ~106% liquidity coverage ratio of uninsured/uncollateralized deposits of $4.9 billion ($ in millions) Discount Window (ex-Bank Term Funding Program) $295 Fed Funds Lines $682 Discount Window – Bank Term Funding Program $
Slide 20: Securities Portfolio at December 31, 2023
Securities Portfolio at December 31, 2023 • As of December 31, 2023, total securities portfolio of Securities Balances $3.1 billion with a total unrealized loss of $413.6 ($in millions) million Total AFS (fair value) and HTM (carrying value) • 73% of total portfolio in available-for-sale at an unrea
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 years ended December 31, % Change (Dollars in thousands, except per share amounts) 4Q2023 3Q2023 2023 2022 YoY Adjusted operating measures exclude, as appli
Slide 23: Reconciliation of Non-GAAP Disclosures
Reconciliation of Non-GAAP Disclosures NET INTEREST MARGIN The Company believes net interest income (FTE), For the three months ended total revenue (FTE), and total adjusted revenue (Dollars in thousands) 4Q2023 3Q2023 (FTE), which are used in computing net interest Net interest income (GAAP) $ 153,
Slide 24: Reconciliation of Non-GAAP Disclosures
Reconciliation of Non-GAAP Disclosures TANGIBLE ASSETS, TANGIBLE COMMON EQUITY, AND LEVERAGE RATIO As of December 31, 2023 Atlantic Union (Dollars in thousands, except per share amounts) Bankshares Atlantic Union Bank Tangible assets and tangible common equity are Tangible Assets used in the calcula
Slide 25: Reconciliation of Non-GAAP Disclosures
Reconciliation of Non-GAAP Disclosures All regulatory capital ratios at December 31, 2023 RISK-BASED CAPITAL RATIOS are estimates and subject to change pending the As of December 31, 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 Tangible assets and tangible common equity are used in OPERATING MEASURES the calculation of certain profitability, capital, and per For the three months ended share ratios. The Company believes tangible assets, (Dollars in thousands) 4Q2023 3Q2023 tangible com
Slide 27: Reconciliation of Non-GAAP Disclosures
Reconciliation of Non-GAAP Disclosures Pre-tax pre-provision adjusted earnings PRE-TAX PRE-PROVISION ADJUSTED OPERATING EARNINGS excludes, as applicable, the provision for credit losses, which can fluctuate For the three months ended significantly from period-to-period under the (Dollars in thousand
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