Western Alliance Bancorporation · NYSE:WAL
Western Alliance Bancorporation — Investor Presentation (June 2021)
23 slides from Western Alliance Bancorporation's investor presentation, Jun 1, 2021
Slide 1: Investor Call Presentation June 1, 2021
Exhibit 99.1 INVESTOR CALL PRESENTATION JUNE 1, 2021Exhibit 99.1 INVESTOR CALL PRESENTATION JUNE 1, 2021
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements that relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. Examples of forward-looking statemen
Slide 3: Investment Highlights
Investment Highlights Seasoned Leadership Team Diversified Business Model – Sustainable Across Market Cycles Diverse, High Quality Loan Portfolio Conservative Credit Culture – Superior Asset Quality Stable, Low-Cost Deposit Franchise Well Capitalized with Excess Liquidity 3Investment Highlights Seas
Slide 4: Management & Leadership Overview
Management & Leadership Overview Kenneth A. Vecchione Dale M. Gibbons President & Chief Executive Officer Vice Chairman, Chief Financial Officer 13 total years at WAL 17 years at WAL 35+ years experience, including senior positions in 30+ years in commercial banking financial services • Appointed CE
Slide 5: Western Alliance Bancorporation Overview
Summary Western Alliance Bancorporation Overview National Commercial Bank Strategy NYSE Headquarters A national banking platform of specialized financial services paired with WAL Phoenix, AZ attractive regional markets provides complementary, diversified revenue streams and high operating leverage t
Slide 6: Historical Financial Trends (10 years)
Highlights Historical Financial Trends (10 years) Net Income ($ million) • Consistently profitable organic growth Total Assets • Organic growth comes with less $36.5 $507 $499 operational and execution risk $436 $26.8 • Targeted opportunistic M&A $325 $23.1 $20.3 • Tuck-in acquisitions where appropr
Slide 7: Q1 2021 Highlights: Net Interest Drivers
Q1 2021 Highlights Net Interest Drivers Spot Rate Spot Rate Total Investments and Yield Loans and Yield • Loan yields declined 8bps following mix 2.47% 4.46% shift into residential loans and general 3.02% 2.98% 2.79% reduction in loan yields, partially offset by 2.61% 5.27% 2.37% 4.82% 4.59% 4.67% 4
Slide 8: Q1 2021 Highlights: Profitability
Q1 2021 Highlights Profitability Highlights¹ • Top decile NIM, efficiency ratio, and ROAA PPNR¹, Net Income & ROA Net Interest Income and NIM 2 among peers on an LTM basis $317.3 $314.8 2.69% $298.4 • PPNR decreased $4.4 million from the 2.37% 2.24% $284.7 2.22% prior quarter, but increased $48.4 mi
Slide 9: Five Quarter Loan Growth and Composition
Highlights Five Quarter Loan Growth and Composition • Diverse mix of regionally-focused commercial banking divisions & nationally- $5.5 Billion Year-Over-Year Growth oriented specialized businesses • Deep segment expertise fuels specialized Total Loans $23.1 $25.0 $26.0 $27.1 $28.7 banking services
Slide 10: Loan Composition by Classification & Borrower Type
Highlights Loan Composition by Classification & Borrower Type • Loan portfolio has maintained low losses Classification Borrower Type throughout pandemic • Trailing four quarters net charge-offs Residential & Consumer 10.9% were $19.0 million, or 7 bps Construction & Other Land • Over 40% of portfol
Slide 11: Selected Portfolios
Highlights Net Interest Income and NIM Selected Portfolios Hotel Franchise Finance ($2.3bn) • No losses were recognized within hotel Statistics • Strong and sophisticated sponsor backing provides ongoing support franchise finance since the beginning of the • Financial flexibility is maximized throug
Slide 12: Q1 2021 Highlights: Asset Quality
Q1 2021 Highlights Asset Quality Classified Assets Special Mention Loans • At quarter end, Total Deferrals were $68.5MM (24bps of Total Loans); nearly all $326 low LTV residential forbearances $298 1.83% $281 1.67% 1.65% 1.58% $247 $224 $171 $149 • Total Classified Assets of $281 million $477 $474 $
Slide 13: Q1 2021 Highlights: Credit Losses and ACL Ratios
Q1 2021 Highlights Credit Losses and ACL Ratios Allowance for Credit Losses Gross Charge-offs and Recoveries • Provision expense release of $32.4 million, driven by improved macroeconomic factors $6 Gross Charge Offs $7 $8.8 and loan growth in lower loss segments $44 $36 Recoveries $7 $37 $9 2 $3 $3
Slide 14: Five Quarter Deposit Growth and Composition
Highlights Five Quarter Deposit Growth and Composition Quarter-over-quarter deposit growth of $6.5 billion driven by (in millions): $13.6 Billion Year-Over-Year Growth Non-Interest-Bearing DDA $4,080 Total Deposits $24.8 $27.5 $28.8 $31.9 $38.4 Savings and MMDA 2,863 Qtr. Change +$2.0 +$2.7 +$1.3 +$
Slide 15: Interest Rate Profile
Highlights Interest Rate Profile Parallel Shift Rate Scenario Interest Rate Ramp Scenario • Asset sensitive balance sheet poised for net interest income expansion in rising rate +9.2% +17.1% environment Net Interest Income Net Interest Income • Conservative ALCO approach favors prudent management ov
Slide 16: Diversified Investment Portfolio
Highlights Diversified Investment Portfolio • >80% of the portfolio is investment grade Investment Type Investment Rating • Of that >50% is AAA/AA+ or better BB+ and below Other AFS CRA Pref. stock 1% • ~89% of the liquid portfolio is investment 1% 1% 2% BBB+ grade Treasuries to BBB- Unrated 0% 4% •
Slide 17: AmeriHome Mortgage Company Acquisition
Business Overview AmeriHome Mortgage Company Acquisition • AmeriHome is a leading national multi- On April 7, 2021, WAL completed the acquisition of Aris Mortgage Holding Company, LLC, the parent channel mortgage purchaser and servicer company for AmeriHome Mortgage Company, LLC for total considerat
Slide 18: Q1 2021 Highlights: Capital Management
Q1 2021 Highlights Capital Management • Conservative credit culture affords Leverage Ratio CET1 Ratio shareholder friendly capital management 10.3% 10.2% 10.0% 10.0% 9.9% 10.2% • Significant profitability and capital retention 9.5% 9.3% 9.2% 8.8% fund organic growth • Recent stock performance enhanc
Slide 19: Conclusion
Conclusion Seasoned Leadership Team Diversified Business Model – Sustainable Across Market Cycles Diverse, High Quality Loan Portfolio Conservative Credit Culture – Superior Asset Quality Stable, Low-Cost Deposit Franchise Well Capitalized with Excess Liquidity 19Conclusion Seasoned Leadership Team
Slide 20: Appendix
WA Western Alliance Bancorporation® Appendix
Slide 21: 1st Quarter 2021 Financial Highlights
Highlights 1st Quarter 2021 | Financial Highlights Earnings & Profitability Q1-21 Q4-20 Q1-20 $192.5 $193.6 $83.9 Net Income Net Income EPS $317.3 $314.8 $269.0 Net Interest Income 1 Pre Provision Net Revenue $202.0 $206.4 $153.6 $192.5 million $1.90 EPS $1.90 $1.93 $0.83 Net Interest Margin 3.37% 3
Slide 22: Q1 2021 Consolidated Balance Sheet
Q1 2021 Highlights Consolidated Balance Sheet Q1-21 Q4-20 Q1-20 Loans increased $1.7 billion, or 6.1%, Investments & Cash $13,235 $8,177 $4,771 1 over prior quarter and $5.5 billion, or Loans $28,711 1 $27,053 $23,166 23.9%, over prior year Allowance for Loan Losses (247) (279) (235) Deposits increa
Slide 23: Q1 2021 Quarterly Income Statement
Q1 2021 Highlights Quarterly Income Statement Q1-21 Q4-20 Q1-20 Net Interest Income increased $2.5 million, Interest Income $334.1 $331.6 $307.2 1 primarily as a result of loan growth, PPP Interest Expense (16.8) (16.8) (38.2) loan fee recognition and lower interest $317.3 1 $314.8 $269.0 Net Intere
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