Prosperity Bancshares, Inc. · NYSE:PB
Prosperity Bancshares — Q1 2017 Earnings Presentation
23 slides from Prosperity Bancshares's earnings presentation, 2017
Slide 1: 1st Quarter 2017
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Slide 2: "Safe Harbor" Statement
“Safe Harbor” Statement under the Private Securities Litigation Reform Act of 1995 Statements contained in this presentation which are not historical facts and which pertain to future operating results of Prosperity Bancshares, Inc.® and its subsidiaries constitute “forward-looking statements” withi
Slide 3: 1Q17 Highlights
1Q17 Highlights • Net Income of $68.565 million and earnings per share (diluted) of $0.99 for three months ending March 31, 2017 • Assets of $22.477 billion, loans of $9.739 billion, and deposits of $17.036 billion at March 31, 2017 • Common equity tier 1 ratio was 14.45% and leverage ratio was 8.62
Slide 4: Corporate Profile
Corporate Profile • A Texas based financial holding company with approximately $22.477 billion in assets, and the 3rd largest Texas-based commercial bank • Shareholder driven with 4.9% fully diluted insider ownership • Successful integration of 42 acquisitions (includes branch and failed bank transa
Slide 5: Balance Sheet Summary
Balance Sheet Summary $4,000 $22,500 Totals as of 03/31/2017 $21,000 Loans = $9.739 Billion Deposits = $17.036 Billion $3,500 $19,500 Assets = $22.477 Billion $18,000 $3,000 $16,500 10 year CAGR Loans = 16.0% $15,000 Deposits = 16.6% $2,500 $13,500 Assets = 17.1% $12,000 Loans $2,000 $10,500 Deposit
Slide 6: Net Income
Net Income $350 Net Income Net Income (excluding Purchase Accounting Adjustments (PAA)) $297.4 $300 10 Year CAGR 16.1% (excluding PAA 15.0%) $286.6 $274.5 5 Year CAGR 14.1% (excluding PAA 12.1%) $255.5 $250.6 $250 $236.2 $221.4 $200 $185.7 $167.9 $154.9 $150 $141.7 $127.7 $111.9 $100 $84.2 $84.5 $68
Slide 7: EPS Growth
EPS Growth Diluted $5.00 EPS EPS (excluding Purchase Accounting Adjustments (PAA)) $4.32 $4.09 10 Year CAGR 7.3% (excluding PAA 6.4%) $3.94 $4.00 5 Year CAGR 5.5% (excluding PAA 3.6%) $3.65 $3.65 $3.60 $3.43 $3.23 $3.01 $2.98 $3.07 $3.00 $2.73 $2.41 $1.94 $1.86 $2.00 $0.98 $0.99 $0.86 $0.95 $1.00 $0
Slide 8: Net Interest Margin
Net Interest Margin 4.50% Net Interest Margin (Tax Equivalent) 4.25% Net Interest Margin (excluding Purchase Accounting Adjustments) 4.00% 3.89% 3.82% 3.83% 3.85% 3.75% 3.59% 3.57% 3.48% 3.50% 3.42% 3.62% 3.35% 3.37% 3.39% 3.30% 3.29% 3.26% 3.43% 3.25% 3.20% 3.33% 3.31% 3.24% 3.26% 3.25% 3.19% 3.17%
Slide 9: Acquisitions & Efficiency Ratio
Acquisitions & Efficiency Ratio* $25,000 Total Assets Acquired (at Acquisition Closing) $22,331 $22,477 $22,037 Total Assets without Acquisitions $21,508 Efficiency Ratio $20,000 $18,642 $14,584 $15,000 45.27% 46.19% 46.51% 46.27% 44.83% 42.76% 43.48% 41.60% 41.81% 41.87% 42.50% 43.01% $10,000 $9,07
Slide 10: Return on Average Tangible Common Equity
Return on Average Tangible Common Equity 40.00% 35.00% 30.03% 30.00% 28.66% 27.40% 25.11% 24.24% 25.00% 22.52% 24.16% 20.00% 21.93% 17.60% 19.98% 15.82% 15.00% 16.95% 10.00% 5.00% 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 1Q16 1Q17 Interim periods annualized. 10
Slide 11: Return on Average Assets
Return on Average Assets 2.00% 1.75% 1.47% 1.44% 1.50% 1.38% 1.38% 1.35% 1.36% 1.33% 1.26% 1.25% 1.24% 1.20% 1.23% 1.25% 1.00% 0.75% 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 1Q16 1Q17 Interim periods annualized. 11
Slide 12: Loan Growth
Loan Growth $10,000 $9,622 $9,654 $9,739 70.0% $9,439 $9,244 Loans $9,000 65.0% Loans/Deposits Ratio $8,000 $7,775 59.1% 60.0% 57.2% $7,000 55.6% 53.4% 54.0% 55.0% $6,000 52.2% $5,180 50.8% $5,000 50.0% 48.8% 46.5% 46.7% 46.7% $4,000 $3,766 $3,567 $3,485 45.0% $3,377 $3,093 44.5% $3,000 40.0% $2,000
Slide 13: Loan Portfolio
Loan Portfolio March 31, 2017 Consumer Loans By Area Loans/Deposits: 57.2% 2.7% Approximate $ in millions Energy Bryan/College Station: $605 Commercial Agriculture 2.8% 13.2% Central Oklahoma: $490 6.8% Construction Central Texas: $1,310 13.6% Dallas/Ft. Worth: $1,022 Commercial R.E. East Texas: $35
Slide 14: Energy Portfolio
Energy Portfolio As of March 31, 2017 Outstanding Balance Portfolio Commentary Total outstanding balance of $267.4 million, or 2.8% of total loans Producers Total unfunded commitments of $153.1 million $108.2 Servicers 40% $159.2 Total energy reserves of 1.9% or $5.1 million 60% $16.2 millio
Slide 15: Houston MSA CRE Portfolio
Houston MSA CRE Portfolio As of March 31, 2017 TOTAL: $1.1 Billion Shopping Center/Retail 18.9% Owner Occupied Shopping Center/Retail - $206.1 46.2% Commercial & Commercial & Industrial - $102.2 Industrial Office - $76.4 9.4% Medical - $61.6 Multi-Family - $38.0 Hotel - $33.9 Office 7.0% Other - $68
Slide 16: Asset Quality
Asset Quality NPA*/Loans + OREO 5.00% 4.88% 4.65% Prosperity Bank 4.50% UBPR - Peer Group 4.00% 3.95% 3.50% 3.00% 2.82% 2.63% 2.50% 2.00% 1.91% 1.50% 1.35% 1.04% 1.08% 0.93% 1.00% 1.07% 0.91% 0.61% 0.57% 0.49% 0.50% 0.40% 0.48% 0.45% 0.32% 0.25% 0.29% 0.40% 0.46% 0.59% 0.50% 0.42% 0.09% 0.05% 0.00%
Slide 17: Deposit Composition
Deposit Composition March 31, 2017 Cost of Deposits: 0.23% Certificates & Other Time Deposits 13.7% DDA - Non- Interest Bearing Amount 31.1% DDA - Non-Interest Bearing $5,299 DDA - Interest Bearing 3,845 Money Market & Savings 5,560 Money Market & Certificates & Other Savings Time Deposits 2,331 32.
Slide 18: Dividend History
Dividend History (c) $1.25 (b) $1.24 Dividend Payment $1.12 (a) $1.05 $0.99 $0.89 $0.80 $0.85 $0.72 $0.64 $0.65 $0.57 $0.51 $0.46 $0.41 $0.45 $0.35 $0.31 Compounded Annual Growth $0.25 $0.25 Rate from 2003-2016 was 13.11% $0.05 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 -$
Slide 19: Total Return Performance
Total Return Performance IPO (November 12, 1998) to March 31, 2017 1,800 $100,000 invested in Prosperity’s 1,600 IPO on 11/12/98 was worth $1,522,804 on 3/31/17 1,400 1,200 1,000 800 600 400 200 0 11/12/1998 11/12/2001 11/12/2004 11/12/2007 11/12/2010 11/12/2013 3/31/2017 PB (+1,422.8%) S&P 500 (+19
Slide 20: Corporate Relocations to Texas
Corporate Relocations to Texas California AccentCare Active Networks The Allen Group, Inc. Allied Electronic Recycling Corporate Relocations to Texas (2004 – Present) ALL-Q-TELL Corp. Canada Ameriflight LLC Absolute Software (ABT) Banker’s Toolbox, Inc. Bio-Solutions Corp (BISU) Boreland Software Co
Slide 21: The Houston Market: Population Growth
The Houston Market: Overview Estimated Growth From January 2016 to January 2017 Growth Drivers Houston is estimated to have added more people The Houston MSA created 16,700 jobs in February of 2017, more than any other MSA than the 15,600 jobs created in February of 2016 200.0 188.8 Since the 20
Slide 22: The Houston Market: Economic Diversity
The Houston Market: Economic Diversity Houston maintains a diverse and productive economy despite recent turbulence in the oil and gas industry The Perryman Group forecasts sustained growth for the Houston metro over the next quarter century February 2017 Employment by Industry Forecasted Housto
Slide 23: Contact Information
Contact Information Corporate Headquarters Investor Contacts Prosperity Bank Plaza David Zalman 4295 San Felipe Chairman & Chief Executive Officer Houston, Texas 77027 979.543.2200 david.zalman@prosperitybankusa.com 281.269.7199 Telephone David Hollaway 281.269-7222 Fax Chief Financial Officer www.p
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