TOWNEBANK Investor Presentation
4th Quarter 2022
Cautionary Statements
Forward Looking:
This presentation contains certain forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements are not historical facts, but instead represent only the beliefs, expectations, or opinions of TowneBank and its management regarding future events, many of which, by their nature, are inherently uncertain. Forward-looking statements may be identified by the use of such words as: "believe," "expect," "anticipate," "intend," "plan," "estimate," or words of similar meaning, or future or conditional terms, such as "will," "would," "should," "could," "may," "likely," "probably," or "possibly." These statements may address issues that involve significant risks, uncertainties, estimates, and assumptions made by management. Factors that may cause actual results to differ materially from those contemplated by such forward-looking statements include the impacts of the ongoing coronavirus (COVID-19) pandemic; competitive pressures in the banking industry that may increase significantly; changes in the interest rate environment that may reduce margins and/or the volumes and values of loans made or held as well as the value of other financial assets held; changes in the creditworthiness of customers and the possible impairment of the collectability of loans; general economic conditions, either nationally or regionally, that may be less favorable than expected, resulting in, among other things, a deterioration in credit quality and/or a reduced demand for credit or other services; changes in the legislative or regulatory environment, including changes in accounting standards and tax laws, that may adversely affect our business; costs or difficulties related to the integration of the businesses we have acquired may be greater than expected; expected cost savings associated with pending or recently completed acquisitions may not be fully realized or realized within the expected time frame; cybersecurity threats or attacks, the implementation of new technologies, and the ability to develop and maintain reliable electronic systems; our competitors may have greater financial resources and develop products that enable them to compete more successfully; changes in business conditions; changes in the securities market; and changes in our local economy with regard to our market area. Any forward-looking statements made by us or on our behalf speak only as of the date they are made or as of the date indicated, and we do not undertake any obligation to update forward-looking statements as a result of new information, future events, or otherwise. For additional information on factors that could materially influence forward-looking statements included in this presentation, see the "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2021, our Quarterly Report on Form 10-Q for the period ended December 31, 2022, and related disclosures in other filings that have been, or will be, filed by TowneBank with the Federal Deposit Insurance Corporation.
Non-GAAP Financial Measures:
This presentation contains certain financial measures determined by methods other than in accordance with accounting principles generally accepted in the United States of America ("GAAP"). Such non-GAAP financial measures include the following: fully tax-equivalent net interest margin, core operating earnings, core net income, tangible book value per common share, total risk-based capital ratio, tier one leverage ratio, tier one capital ratio, and the tangible common equity to tangible assets ratio. Management uses these non-GAAP financial measures to assess the performance of TowneBank's core business and the strength of its capital position. Management believes that these non-GAAP financial measures provide meaningful additional information about TowneBank to assist investors in evaluating operating results, financial strength, and capitalization. The non-GAAP financial measures should be considered as additional views of the way our financial measures are affected by significant charges for credit costs and other factors. These non-GAAP financial measures should not be considered as a substitute for operating results determined in accordance with GAAP and may not be comparable to other similarly titled measures of other companies. The computations of the non-GAAP financial measures used in this presentation are referenced in a footnote or in the appendix to this presentation.
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Performance Highlights
QTD | |||||||||
Dollars in millions, except per share data | Q4-FY22 | Q3-FY22 | Q/Q Change | Q4-FY21 | Y/Y Change | ||||
% | % | ||||||||
Net Interest Income | $ | 128.78 | $ | 124.04 | 3.8% | $ | 100.79 | 27.8% | |
Noninterest Income | 46.52 | 55.20 | (15.7%) | 59.63 | (22.0%) | ||||
Total Revenue | 175.31 | 179.24 | (2.2%) | 160.42 | 9.3% | ||||
Noninterest Expense | 111.14 | 112.03 | (0.8%) | 110.47 | 0.6% | ||||
Net Income Attributable to TowneBank | 46.69 | 50.17 | (6.9%) | 40.18 | 16.2% | ||||
Earnings Per Share-Diluted | $ | 0.64 | $ | 0.69 | (7.1%) | $ | 0.55 | 16.0% | |
Pre-taxPre-Provision Net Revenue (PPNR)1 | 64.36 | 66.70 | (3.5%) | 48.48 | 32.7% | ||||
PPNR Operating EPS1 | $ | 0.89 | $ | 0.92 | (3.5%) | $ | 0.67 | 32.7% |
YTD | |||||
Q4-FY22 | Q4-FY21 | Y/Y Change | |||
% | |||||
$ | 461.36 | $ | 402.37 | 14.7% | |
225.57 | 277.96 | (18.8%) | |||
686.93 | 680.33 | 1.0% | |||
441.28 | 417.27 | 5.8% | |||
188.99 | 215.38 | (12.3%) | |||
$ | 2.60 | $ | 2.97 | (12.3%) | |
244.17 | 253.41 | (3.6%) | |||
$ | 3.36 | $ | 3.49 | (3.7%) |
22
years of consistent
earnings
performance
$46.69M
Net income in 4Q22
($0.64 per share)
Dividends Per Share | 0.23 | 0.23 | - | 0.20 | 15.0% |
Book Value per Share | 25.73 | 25.08 | 2.6% | 26.13 | (1.5%) |
Tangible Book Value per Share1 | 18.84 | 18.17 | 3.7% | 19.15 | (1.6%) |
Assets | 15,845 | 15,952 | (0.7%) | 16,361 | (3.2%) |
Loans | 10,795 | 10,560 | 2.2% | 9,506 | 13.6% |
Deposits | 13,294 | 13,412 | (0.9%) | 13,574 | (2.1%) |
Net Interest Margin (GAAP) | 3.51% | 3.28% | 6.7% | 2.70% | 29.8% |
Net Interest Margin (TE)1 | 3.53% | 3.31% | 6.8% | 2.72% | 29.8% |
Noninterest Income / Total Revenue | 26.54% | 30.80% | (13.8%) | 37.17% | (28.6%) |
Return on Avg Assets | 1.16% | 1.22% | (4.8%) | 0.99% | 17.2% |
Return on Avg Tangible Common Equity1 | 14.44% | 15.27% | (5.4%) | 12.22% | 18.1% |
Nonperforming Assets / Assets | 0.04% | 0.03% | 26.5% | 0.06% | (33.2%) |
Allowance for Credit Losses / Loans | 1.03% | 1.02% | 0.8% | 1.12% | (8.0%) |
Net Charge-offs / Average Loans | 0.11% | -0.01% | n/m | 0.00% | n/m |
1. Non-GAAP financial measures - see non-GAAP reconciliations
0.89 | 0.78 | 14.1% |
25.73 | 26.13 | (1.5%) |
18.84 | 19.15 | (1.6%) |
15,845 | 16,361 | (3.2%) |
10,795 | 9,506 | 13.6% |
13,294 | 13,574 | (2.1%) |
3.08% | 2.84% | 8.4% |
3.10% | 2.86% | 8.4% |
32.84% | 40.86% | (19.6%) |
1.16% | 1.40% | (17.0%) |
14.54% | 16.75% | (13.2%) |
0.04% | 0.06% | (33.2%) |
1.03% | 1.12% | (8.0%) |
0.03% | 0.00% | n/m |
$175.31
Total revenue, a 9.3% increase
compared to 4Q21
1.03%
Total loan losses allowance
3.53%
Taxable equivalent net interest
margin for 4Q22
13.55%
Annual growth in loans
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Income Statement Summary
QTD | ||||||||
Dollars in millions | Q4-FY22 | Q3-FY22 | Q/Q | Q4-FY21 | Y/Y Change | |||
% | % | |||||||
Interest Income | $ | 151.92 | $ | 137.52 | 10.5% | $ | 109.50 | 38.7% |
Interest Expense | 23.13 | 13.49 | 71.5% | 8.71 | 165.6% | |||
Net Interest Income | 128.78 | 124.04 | 3.8% | 100.79 | 27.8% | |||
Provision for Credit Losses | 6.07 | 3.93 | 54.7% | (1.11) | (647.5%) | |||
Net Interest Income after Provision for Credit | 122.71 | 120.11 | 2.2% | 101.90 | 20.4% | |||
Losses | ||||||||
Noninterest Income | 46.52 | 55.20 | (15.7%) | 59.63 | (22.0%) | |||
Noninterest Expense | 111.14 | 112.03 | (0.8%) | 110.47 | 0.6% | |||
Income Before Taxes and Noncontrolling | 58.09 | 63.28 | (8.2%) | 51.07 | 13.8% | |||
Interests | ||||||||
Provision for Income Tax Expense | 11.60 | 12.61 | (8.0%) | 9.41 | 23.2% | |||
Minority Interest in Unconsolidated Subs | (0.19) | 0.50 | (137.9%) | 1.47 | (112.9%) | |||
Net Income Attributable to TowneBank | $ | 46.69 | $ | 50.17 | (6.9%) | $ | 40.18 | 16.2% |
YTD | ||||
Q4-FY22 | Q4-FY21 | Y/Y Change | ||
% | ||||
$ | 517.94 | $ | 443.45 | 16.8% |
56.57 | 41.08 | 37.7% | ||
461.36 | 402.37 | 14.7% | ||
8.61 | (16.77) | (151.3%) | ||
452.76 | 419.14 | 8.0% | ||
225.57 | 277.96 | (18.8%) | ||
441.28 | 417.27 | 5.8% | ||
237.05 | 279.83 | (15.3%) | ||
46.58 | 54.80 | (15.0%) | ||
1.48 | 9.65 | (84.6%) | ||
$ | 188.99 | $ | 215.38 | (12.3%) |
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Financial Performance Trends
Core Net Income1 DOLLARS IN MILLIONS
$216.2
$190.0
$141.5 | $139.4 | $145.5 |
2018 | 2019 | 2020 | 2021 | 2022 |
Core ROAA1
1.33% | 1.41% | |||
1.20% | 1.17% | |||
1.03% | ||||
2018 | 2019 | 2020 | 2021 | 2022 |
1. Non-GAAP financial measures - see non-GAAP reconciliations
Core Efficiency Ratio1
64.67% | 62.54% | |||
62.34% | 60.34% | |||
59.66% | ||||
2018 | 2019 | 2020 | 2021 | 2022 |
Core ROATCE1 | ||||
15.49% | 16.81% | |||
14.62% | ||||
13.78% | ||||
12.75% | ||||
2018 | 2019 | 2020 | 2021 | 2022 |
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TowneBank published this content on 26 January 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 26 January 2023 14:02:05 UTC.
