Slides
Page 1
0 2nd Quarter 2025 Earnings Call July 25, 2025
Page 2
FORWARD-LOOKING STATEMENTS This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements reflect our current views with respect to, among other things, future events and our financial performance. These statements are often, but not always, made through the use of words or phrases such as “may”, “might”, “should”, “could”, “predict”, “potential”, “believe”, “expect”, “continue”, “will”, “anticipate”, “seek”, “estimate”, “intend”, “plan”, “projection”, “would”, “annualized” and “outlook”, or the negative version of those words or other comparable words or phrases of a future or forward-looking nature. These forward-looking statements are not historical facts, and are based on current expectations, estimates and projections about our industry, management's beliefs and certain assumptions made by management, many of which, by their nature, are inherently uncertain and beyond our control. Accordingly, we caution you that any such forward-looking statements are not guarantees of future performance and are subject to risks, assumptions, estimates and uncertainties that are difficult to predict. Although we believe that the expectations reflected in these forward-looking statements are reasonable as of the date made, there can be no assurance that actual results will not prove to be materially different from the results expressed or implied by the forward-looking statements. A number of important factors could cause actual results or performance to differ materially from the forward- looking statements, including (without limitation) the risks and uncertainties associated with the domestic and global economic environment and capital market conditions and other risk factors. For a discussion of some of these risks and important factors that could affect our future results and financial condition, see our U.S. Securities and Exchange Commission (“SEC”) filings, including, but not limited to, our Annual Report on Form 10-K for the year ended December 31, 2024 and our Quarterly Report on Form 10-Q for the quarter ended March 31, 2024. 1
Page 3
Q2 2025 FINANCIAL HIGHLIGHTS1 (1) Comparisons to Q1 2025 (2) ROATA and ROATCE are non-GAAP financial measures. A reconciliation of average tangible assets and average tangible stockholders’ equity to the comparable GAAP measurements is provided in the appendix of this slide presentation. (3) Declared on July 23, 2025. Payable August 29, 2025 to shareholders of record at close of business on August 18, 2025. 2 • Net income: $73.2 mm • Cost of deposits: 1.39% • Total cost of funds: 1.42% • Net interest margin increased 3 bp to 3.11% • Excellent credit quality. Recorded $4.5 mm provision • 16.9% effective tax rate • Well capitalized: 13.03% CET1 ratio • Declared $0.26 / share dividend Q2 2025 Q1 2025 Net Income ($mm) $73.2 $59.2 Diluted EPS $0.58 $0.47 Net Interest Margin 3.11% 3.08% Efficiency Ratio 57.2% 58.2% ROA / ROATA2 1.23% / 1.28% 1.01% / 1.05% ROE / ROATCE2 11.03% / 17.61% 9.09% / 14.59% Tier 1 Leverage Ratio CET1 Capital Ratio Total Capital ratio 9.12% 13.03% 14.28% 9.01% 12.93% 14.17% Dividend3 $0.26 / share $0.26 / share
Page 4
Q2 2025 BALANCE SHEET HIGHLIGHTS1 3 $ in millions 6/30/25 3/31/25 Assets Cash and Cash Equivalents2 $ 1,399.0 $ 1,314.6 Investment Securities - AFS 1,891.7 1,858.4 Investment Securities - HTM 3,658.8 3,724.9 Loans and Leases 14,351.9 14,293.0 Total Assets 23,837.1 23,745.0 Liabilities Deposits $20,231.4 $20,215.8 Short-term borrowings 250.0 250.0 Total Stockholders’ Equity 2,694.5 2,648.9 (1) Comparisons to Q1 2025 (2) Includes Cash and due from banks and Interest-bearing deposits in other banks • Total loans and leases increased $58.8 mm • Total deposits increased $15.6 mm • Anticipate maintaining the size of the investment portfolio • Repurchased 1.0 million shares of common stock, at a total cost of $25 million • TBV increased to $13.63 / share
Page 5
5.3 5.3 5.3 4.2 4.1 4.1 2.2 2.3 2.4 1.0 1.0 1.0 1.2 1.1 1.2 0.4 0.4 0.4 14.4 14.3 14.4 Jun-24 Mar-25 Jun-25 ($ billions) LOANS INCREASED $58.8 MM, OR 0.4% (70) (44) (10) 13 17 44 109 Consumer Total Loans and Leases 6/30/25 vs 3/31/25 Net Changes ($ millions) (4.8%) Note: Segments may not sum to total due to rounding CRE (1.1%) C&I CRE & Construction Residential Home Equity Construction (1.5%) Residential C&I Consumer Home Equity Leasing (1.0%) 4 Leases(2.4%) (1.3%) (7.3%)
Page 6
10.19.2 0.9 Retail Commercial Public TOTAL DEPOSITS INCREASED $16 MM TOTAL COST OF DEPOSITS DOWN 4 BPS 6.9 6.9 6.8 6.1 6.1 6.2 4.1 3.9 3.8 3.3 3.4 3.4 20.3 20.2 20.2 Jun-24 Mar-25 Jun-25 ($ billions) Total Deposits Deposit Composition ($ billions) Note: Segments may not sum to total due to rounding Quarterly Cost of Deposits 170 bps 143 bps 139 bps Q2 Highlights • $16 mm, or 0.1%, increase in total deposits o $150 mm decline in retail and commercial deposits o $23 mm decline in retail deposits o $127 mm decline in commercial deposits o $166 mm increase in total public deposits due to increases in operating account balances • 139 bp cost of deposits, down 4 bp • 34% noninterest bearing / total deposit ratio, unchanged from prior quarter Time Money Market Savings Demand 5
Page 7
152.9 160.5 163.6 2.92% 3.08% 3.11% 1.00%1.10%1.20%1.30%1.40%1.50%1.60%1.70%1.80%1.90%2.00%2.10%2.20%2.30%2.40%2.50%2.60%2.70%2.80%2.90%3.00%3.10%3.20%3.30%3.40%3.50%3.60%3.70%3.80%3.90%4.00%4.10%4.20%4.30%4.40%4.50%4.60%4.70%4.80%4.90%5.00% 0.05.010.015.020.025.030.035.040.045.050.055.060.065.070.075.080.085.090.095.0100.0105.0110.0115.0120.0125.0130.0135.0140.0145.0150.0155.0160.0165.0170.0175.0180.0185.0190.0195.0200.0205.0210.0 Q2 24 Q1 25 Q2 25 $3.1 MM INCREASE IN NET INT INCOME 3 BP INCREASE IN NIM ($ millions) Net Interest Income and Net Interest Margin Q2 Highlights • Net interest margin increased 3 bps in Q2 o NIM improvement primarily driven by lower deposit cost • 1.42% cost of funds, down 4 bps 3.08% -0.01% 0.04% 3.11% Q1 2025 Asset Repricing Deposit Repricing Q2 2025 Q1 ‘25 – Q2 ‘25 NIM Walk 6
Page 8
122.1 123.6 124.9 59.2% 58.2% 57.2% Q2 24 Q1 25 Q2 25 51.8 50.5 54.0 Q2 24 Q1 25 Q2 25 NONINTEREST INCOME AND EXPENSE 7 ($ millions) Noninterest Income Noninterest Expense Nonint Expense Efficiency Ratio ($ millions)
Page 9
ASSET QUALITY REMAINS STRONG 8 ▪ 30-89 days past due is comprised of accruing and non-accruing loans▪ TLL - Total Loans and Leases ▪ QTD NCO Rate - Annualized QTD NCO/Avg Loans and Leases ▪ Includes OREO and 90+ days past due accruing loans ($ millions) ($ millions) ($ millions)($ millions)
Page 10
ALLOWANCE FOR CREDIT LOSS RESERVE LEVELS CONTINUE TO PROVIDE FOR UNCERTAINTY 9 Rollforward of the On-Balance Sheet Allowance for Credit Losses • The Asset ACL / Total Loans and Leases is at 1.17%, unchanged from Q1. ($ in 000’s) C&I CRE Const Lease Mortgage Home Equity Consumer Total 3/31/2025 17,992 39,370 9,511 2,344 34,374 10,270 52,751 166,612 Charge-offs -688 - - -82 - -16 -4,543 -5,329 Recoveries 196 - - - 109 32 1,705 2,042 Provision 2,561 -106 -566 81 3,482 904 -1,856 4,500 6/30/2025 20,061 39,264 8,945 2,343 37,965 11,190 48,057 167,825 % of Total ACL 12.0% 23.4% 5.3% 1.4% 22.6% 6.7% 28.6% 100.0% Total Loan Balance 2,370,210 4,411,585 884,306 426,940 4,085,827 1,161,876 1,011,125 14,351,869 ACL/Total LL 0.85% 0.89% 1.01% 0.55% 0.93% 0.96% 4.75% 1.17%
Page 11
10 QUESTIONS
Page 12
APPENDIX 11
Page 13
COMMERCIAL REAL ESTATE 12 (As of 06/30/25) CRE exposure increased $44.2MM from Q1 2025 with the larger increases in Hotel and Multi-family. The portfolio continues to be well diversified across property types, well secured with a weighted average LTV of 58.4%. Criticized rate increased to 4.4%. • Office exposure in CRE represents approximately 5.1% of total loans and leases, with criticized office CRE at 12 bps of total loans and leases. • The CRE portfolio continues to perform well, reflecting the quality of sponsorship and underlying collateral. • The Bank continues to monitor the CRE book closely, focusing attention on investor real estate, construction/development and office. Property Type Balances ($ mm) % of Balances Weighted Average LTV % Criticized Office 729 16.5% 59.4% 2.3% Hotel 467 10.6% 51.8% 0.0% Retail 892 20.2% 60.4% 1.9% Multi-family 873 19.8% 56.1% 14.1% Industrial 635 14.4% 57.9% 5.0% Dealer Related 447 10.1% 66.3% 0.6% Other 369 8.4% 56.6% 0.6% Total 4,412 100.0% 58.4% 4.4%
Page 14
COMMERCIAL & INDUSTRIAL 13 (As of 06/30/25) Industries deemed to exhibit higher volatility represent a modest amount of total C&I exposure and dealer related credits represent about 37.8% of total C&I. Industry Balances ($ mm) % of Balances % Criticized Auto Dealers 895 37.8% 1.6% Retail - 0.0% 0.0% Hospitality/Hotel 100 4.2% 0.0% Food Service 40 1.7% 2.3% Transportation 70 2.9% 0.0% Other 1,265 53.4% 7.2% Total 2,370 100.0% 4.5%
Page 15
CONSTRUCTION 14 (As of 06/30/25) The construction book is concentrated in Multi-family and largely centered in rental and for-sale housing. Multi-family criticized rate is 0.0%, unchanged from Q1 2025. Property Type Balances ($ mm) % of Balances Weighted Average LTV % Criticized Office 21 2.4% 46.1% 0.0% Hotel 46 5.2% 50.4% 0.0% Retail 27 3.0% 58.8% 0.0% Multi-family 491 55.5% 54.8% 0.0% Industrial 150 17.0% 54.3% 0.0% Dealer Related 68 7.7% 78.7% 0.0% Other 81 9.2% 58.4% 1.3% Total 884 100.0% 56.6% 0.1%
Page 16
SUMMARY INCOME STATEMENT Quarter ended ($ in millions except per share data) 6/30/25 3/31/25 6/30/24 Net interest income $ 163.6 $ 160.5 $ 152.9 Provision for credit losses 4.5 10.5 1.8 Noninterest income 54.0 50.5 51.8 Noninterest expense 124.9 123.6 122.1 Pre-tax income 88.1 76.9 80.7 Tax expense 14.9 17.7 18.8 Net Income $ 73.2 $ 59.2 $ 61.9 Diluted earnings per share $ 0.58 $ 0.47 $ 0.48 15 Note: Totals may not sum due to rounding.
Page 17
SELECTED BALANCE SHEET ITEMS ($ in millions except per share data) As of 6/30/25 3/31/25 6/30/24 Selected Assets Investment securities – AFS $ 1,891.7 $ 1,858.4 $ 2,068.0 Investment securities – HTM 3,658.8 3,724.9 3,917.2 Loans and leases 14,351.9 14,293.0 14,359.9 Total assets 23,837.1 23,745.0 23,991.8 Selected Liabilities and Stockholders’ Equity Total deposits $ 20,231.4 $ 20,215.8 $ 20,318.8 Short-term borrowings 250.0 250.0 500.0 Total stockholders’ equity 2,694.5 2,648.9 2,550.3 Shares Outstanding 124,683,544 125,692,598 127,879,012 Book value per share $ 21.61 $ 21.07 $ 19.94 Tangible book value per share (1) 13.63 13.15 12.16 Tier 1 Leverage Ratio 9.12 % 9.01 % 9.03 % CET 1 / Tier 1 13.03 % 12.93 % 12.73 % Total Capital Ratio 14.28 % 14.17 % 13.92 % 16(1) Non-GAAP financial measure. A reconciliation to the directly comparable GAAP measure is provided in the appendix of this slide presentation.
Page 18
GAAP TO NON-GAAP RECONCILIATIONS Return on average tangible assets, return on average tangible stockholders’ equity, tangible book value per share and tangible stockholders’ equity to tangible assets are non-GAAP financial measures. We compute our return on average tangible assets as the ratio of net income to average tangible assets, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total assets. We compute our return on average tangible stockholders’ equity as the ratio of net income to average tangible stockholders’ equity, which is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our average total stockholders’ equity. We compute our tangible book value per share as the ratio of tangible stockholders’ equity to outstanding shares. Tangible stockholders’ equity is calculated by subtracting (and thereby effectively excluding) amounts related to the effect of goodwill from our total stockholders’ equity. We compute our tangible stockholders’ equity to tangible assets as the ratio of tangible stockholders’ equity to tangible assets, each of which we calculate by subtracting (and thereby effectively excluding) the value of our goodwill. We believe that these measurements are useful for investors, regulators, management and others to evaluate financial performance and capital adequacy relative to other financial institutions. Although these non- GAAP financial measures are frequently used by stakeholders in the evaluation of a company, they have limitations as analytical tools and should not be considered in isolation or as a substitute for analysis of our results or financial condition as reported under GAAP. Investors should consider our performance and capital adequacy as reported under GAAP and all other relevant information when assessing our performance and capital adequacy. The following tables provide a reconciliation of these non-GAAP financial measures with their most directly comparable GAAP measures. 17
Page 19
(dollars in thousands) Income Statement Data: Net income $ 73,247 $ 59,248 $ 61,921 $ 132,495 $ 116,141 Average total stockholders' equity $ 2,663,850 $ 2,641,978 $ 2,512,471 $ 2,652,975 $ 2,504,656 Less: average goodwill 995,492 995,492 995,492 995,492 995,492 Average tangible stockholders' equity $ 1,668,358 $ 1,646,486 $ 1,516,979 $ 1,657,483 $ 1,509,164 Average total assets $ 23,859,410 $ 23,890,459 $ 23,958,913 $ 23,874,849 $ 24,073,060 Less: average goodwill 995,492 995,492 995,492 995,492 995,492 Average tangible assets $ 22,863,918 $ 22,894,967 $ 22,963,421 $ 22,879,357 $ 23,077,568 Return on average total stockholders' equity (1) 11.03 % 9.09 % 9.91 % 10.07 % 9.32 % Return on average tangible stockholders' equity (non-GAAP) (1) 17.61 % 14.59 % 16.42 % 16.12 % 15.48 % Return on average total assets (1) 1.23 % 1.01 % 1.04 % 1.12 % 0.97 % Return on average tangible assets (non-GAAP) (1) 1.28 % 1.05 % 1.08 % 1.17 % 1.01 % (dollars in thousands, except per share amounts) Balance Sheet Data: Total stockholders' equity $ 2,694,545 $ 2,648,852 $ 2,617,486 $ 2,550,312 Less: goodwill 995,492 995,492 995,492 995,492 Tangible stockholders' equity $ 1,699,053 $ 1,653,360 $ 1,621,994 $ 1,554,820 Total assets $ 23,837,147 $ 23,744,958 $ 23,828,186 $ 23,991,791 Less: goodwill 995,492 995,492 995,492 995,492 Tangible assets $ 22,841,655 $ 22,749,466 $ 22,832,694 $ 22,996,299 Shares outstanding 124,683,544 125,692,598 126,422,898 127,879,012 Total stockholders' equity to total assets 11.30 % 11.16 % 10.98 % 10.63 % Tangible stockholders' equity to tangible assets (non-GAAP) 7.44 % 7.27 % 7.10 % 6.76 % Book value per share $ 21.61 $ 21.07 $ 20.70 $ 19.94 Tangible book value per share (non-GAAP) $ 13.63 $ 13.15 $ 12.83 $ 12.16 As of As of As of As of For the Three Months E nded For the Six Months E nded June 30, March 31, June 30, June 30, 2025 2025 2024 2025 2024 June 30, March 31, December 31, June 30, 2025 2025 2024 2024 GAAP TO NON-GAAP RECONCILIATION 18 (1) Annualized for the three months ended June 30, 2025, March 31, 2025 and June 30, 2024 and six months ended June 30, 2025 and June 30, 2024