United Community Banks, Inc. · NYSE:UCB
United Community Banks — Q1 2023 Earnings Presentation
27 slides from United Community Banks's earnings presentation, Apr 19, 2023
Slide 1: 1Q23 Investor Presentation
1Q23 Investor Presentation April 18, 2023 Member FDIC. © 2023 United Community Bank | ucbi.com
Slide 2: Disclosures: Cautionary Statement
Disclosures CAUTIONARY STATEMENT This communication contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In general, forward-looking statements usually may be identified
Slide 3: Disclosures: Non-GAAP Measures
Disclosures NON-GAAP MEASURES This Investor Presentation includes financial information determined by methods other than in accordance with generally accepted accounting principles (“GAAP”). This financial information includes certain operating performance measures, which exclude merger-related and
Slide 4: United Community Banks, Inc. Company Overview
United Community Banks, Inc. Company Overview Committed to Service Since 1950 $25.9 $17.1 BILLION IN BILLION IN TOTAL ASSETS TOTAL LOANS Regional Full Service Branch Network National Navitas and SBA Markets $4.4 $22.0 BILLION IN BILLION IN AUA TOTAL DEPOSITS UCBI Banking Offices 100 BEST BANKS IN 12
Slide 5: 1Q23 Highlights
$0.52 7.34% Diluted earnings per share Return on common equity – GAAP – GAAP $0.58 11.63% 1Q23 Highlights Diluted earnings per share Return on tangible common – operating(1) equity – operating(1) Diluted Earnings Per Share Return on Average Assets $0.74 $0.75 1.33% 1.35% 0.95% 8.2% $0.43 $0.50 $0.52
Slide 6: Long-Term Financial Performance & Shareholder Return
Long-Term Financial Performance & Shareholder Return ROA(1)(2) ROTCE(1)(2) 1.51% 17.33% 1.40% 1.42% 15.69% 15.81% 1.46% 14.04% 1.19% 1.09% 1.35% 1.07% 12.24% 13.14% 1.06% 1.37% 1.06% 11.86% 12.02% 11.60% 11.89% 11.63% 1.04% 1.13% 9.41% 9.25% 9.54% 1.00% 0.95% 7.34% 5.67% 0.62% 2016 2017 2018 2019 20
Slide 7: Footprint Focused on High-Growth MSAs in Southeast
Footprint Focused on High-Growth MSAs in Southeast Fastest Growing UCBI (3) ’23 – ’28 ’23 – ’28 ’22 Total Fastest Growing UCBI (3) ’23 – ’28 ’23 – ’28 ’22 Total Major Southeast Market (%) of Total Proj. Pop. Proj. HHI. Deposits Mid-Size Southeast Market (%) of Total Proj. Pop. Proj. HHI. Deposits MS
Slide 8: Outstanding Deposit Franchise
Outstanding Deposit Franchise 1Q23 Total Deposits $22.0 billion Time Strong Deposit Growth ✓ Total deposits were up $790 million in 1Q23, or 14.9% annualized Savings 14% from 4Q22 (excluding Progress) 6% 34% DDA ✓ Total customer deposits were up $525 million in 1Q23, or 10.0% annualized from 4Q22 (e
Slide 9: Deposit Trends Excluding Progress Acquisition
Deposit Trends Excluding Progress Acquisition 3Q22 4Q22 1Q23 EOP Balance Avg. Customer EOP Balance Avg. Customer EOP Balance Avg. Customer ($ in millions) Balance ($ in millions) Balance ($ in millions) Balance Business - DDA $5,310 $60,184 $4,778 $54,028 $4,766 $53,467 Business - All Other $2,371 $
Slide 10: Uninsured Deposits Excluding Progress Acquisition
Uninsured Deposits Excluding Progress Acquisition $ in billions Total Insured Collateralized Uninsured & Uninsured & Deposit Type Deposits $ Deposits $ Deposits $ Uncollateralized $ Uncollateralized % Retail $10.8 $9.1 - $1.7 16% Business $6.5 $3.1 - $3.4 52% Public $2.5 $0.1 $2.4 $0.0 0% Sweep $0.5
Slide 11: Well-Diversified Loan Portfolio
Well-Diversified Loan Portfolio $ in billions 1Q23 Total Loans $17.1 billion Quarter Highlights Manufactured ✓ Excluding Progress, loans increased $345 Residential Housing Construction million, or 8.2% annualized 2% Home Equity 3% ✓ Construction & CRE ratio as a percentage of 5% total RBC = 83% / 20
Slide 12: Balance Sheet Strength – Liquidity and Capital
Balance Sheet Strength – Liquidity and Capital Loans / Deposits % 85% ✓ Substantial balance sheet liquidity and above-peer capital ratios 77% 78% ✓ $5.9 billion securities portfolio offers 70% 73% significant near- and medium-term cash 68% 66% 64% flow opportunities ✓ FHLB borrowings declined to $30
Slide 13: Capital
Capital Risk-Based Capital Ratios* CET1 Non-common Tier 1 Tier 2 Total ✓ 1Q23 regulatory capital ratios 14.7% 14.3% 14.5% 14.6% 14.8% 14.5% decreased slightly due to closing 13.6% 1.5% 0.7% 1.9% 1.9% 1.9% 0.6% 2.0% 0.5% 1.9% 1.9% 0.5% the Progress acquisition 0.6% 0.6% 0.3% ✓ The leverage ratio decr
Slide 14: Net Interest Revenue / Margin
(1) Net Interest Revenue / Margin $ in millions Net Interest Revenue & Net Interest Margin $209.9 $211.5 ✓ Net interest revenue increased $1.6 million from 4Q22 ✓ Net interest margin increased 64 bps compared to 1Q22, 4.0 0% 3.76% $20 0.0 $163.8 3.61% 3.5 0% 3.74% but decreased 15 bps from 4Q22, pri
Slide 15: Noninterest Income
Noninterest Income Linked Quarter $ in millions ✓ Fees were down $3.2 million $39.0 • Other income was down $4.1 million due to $3.5 million less in positive equity gains and $1.6 $4.7 million in 1Q securities losses $33.5 $33.4 • A $1.4 million increase in mortgage fees was $3.2 $31.9 driven by $1.
Slide 16: Disciplined Expense Management
Disciplined Expense Management Efficiency Ratio % 57.4% 56.6% 57.2% ✓ The efficiency ratio increased compared to last quarter due to the 15 bps decrease in our 53.2% 50.86% 53.7% margin and seasonal increase in expenses 53.1% 48.4% 48.0% 47.7% 47.4% 1Q22 2Q22 3Q22 4Q22 1Q23 GAAP Operating KRX Peer M
Slide 17: Credit Quality
Credit Quality Net Charge-Offs as % of Average Loans ✓ 1Q23 net charge-offs of $7.1 million, or 0.17% of average loans, annualized • Navitas 1Q23 NCOs of 0.93%, annualized, or $3.4 million 0.17% 0.17% 0.17% ✓ Non-performing assets increased $29.1 million during the quarter and were 0.08% 0.43% of to
Slide 18: Allowance for Credit Losses
Allowance for Credit Losses Allowance for Credit Losses (ACL) Walk-Forward ✓ The provision for credit losses $10,447 $4,186 $7,390 $2,704 was $21.8 million in 1Q23 $197,923 $180,520 ($7,084) ($240) ✓ Loan growth accounted for $4.2 million of the provision ($000) increase ✓ NCOs drove $7.1 million in
Slide 19: 1Q23 Investor Presentation Exhibits
1Q23 INVESTOR PRESENTATION Exhibits Member FDIC. © 2023 United Community Bank | ucbi.com
Slide 20: Navitas Performance
Navitas Performance $ in millions Navitas Portfolio $1, 600 9.12% 9.08% 9.08% 9.01% 8.89% 8.85% 8.80% 8.79% 8.88% 8.99% 10. 00% ✓ Navitas represents 8% of total $1, 400 9.0 0% loans ✓ Navitas 1Q23 NCOs of 8.0 0% $1, 200 7.0 0% $1, 000 6.0 0% 0.93%, or $3.4 million $80 0 $1,374 $1,447 5.0 0% ✓ Navita
Slide 21: Mortgage Activity Shift to Purchase & Adj. Rate Loans
Mortgage Activity Shift to Purchase & Adj. Rate Loans $ in millions Mortgage Locks & Sales $80 0 5.5 % ✓ Rate locks were $335 million compared to $70 0 $757 $60 0 3.6% 3.7% 4.5 % $364 million in 4Q22 3.1% 2.9% $597 2.7% ✓ 27% of locked loans were variable rate 3.5 % $50 0 $456 $40 0 2.5 % $30 0 $364
Slide 22: Selected Segments – Senior Care
Selected Segments – Senior Care $ in millions $535 $537 $549 $520 $518 $465 $442 1% $410 6% $408 20% 49% $170 $169 25% $170 $144 $91 $172 $135 $111 $124 $80 $80 $79 $106 $53 $71 $73 $65 $60 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23 Substandard $ Special Mention $ Pass $ ✓ Senior Care lending team
Slide 23: Selected Segments – Office
Selected Segments – Office $ in millions Investment CRE – Office Exposure Outstanding $ $710 $666 $683 $664 $661 $573 1% $538 $531 $541 6% 20% 49% 25% 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23 ✓ Office portfolio is distributed across our Southeastern primary and secondary markets, with very few l
Slide 24: Pending Acquisition of First Miami Bancorp, Inc.
Pending Acquisition of First Miami Bancorp, Inc. Acquisition Highlights Orlando Florida ✓ $1.0 billion community bank operating in attractive Miami market Melbourne ✓ 70-year-old community bank with deep presence and strong relationships in the Miami MSA Tampa ✓ Adds greater scale to our wealth mana
Slide 25: Non-GAAP Reconciliation Tables
25 Non-GAAP Reconciliation Tables $ in thousands, except per share data 1Q22 2Q22 3Q22 4Q22 1Q23 Expenses Expenses - GAAP $ 119,275 $ 120,790 $ 112,755 $ 117,329 $ 139,805 Merger-related and other charges (9,016) (7,143) (1,746) (1,470) (8,631) Expenses - Operating $ 110,259 $ 113,647 $ 111,009 $ 11
Slide 26: Non-GAAP Reconciliation Tables
26 Non-GAAP Reconciliation Tables $ in thousands, except per share data 1Q22 2Q22 3Q22 4Q22 1Q23 Return on Assets to return on assets- pre-tax pre-provision Return on assets - GAAP 0.78 % 1.08 % 1.32 % 1.33 % 0.95 % Income tax expense 0.20 0.32 0.37 0.41 0.29 (Release of) provision for credit losses
Slide 27: Glossary
27 Glossary ACL – Allowance for Credit Losses MLO – Mortgage Loan Officer ALLL – Allowance for Loan Losses MMDA – Money Market Deposit Account AOCI – Accumulated Other Comprehensive Income (Loss) MTM – Marked-to-market AUA – Assets Under Administration MSA – Metropolitan Statistical Area BPS – Basis
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