Q3 2024 Earnings Release Presentation
Third Quarter 2024
Earnings Conference Call
Financial Highlights
3Q24 Financial Highlights
Change vs.
|
Dollars in millions, except per share amounts |
3Q24 |
2Q24 |
3Q23 |
Balance
Sheet
Capital and
Liquidity
|
Total assets |
$ |
6,552.5 |
(0.44) % |
1.31 |
% |
|
|
Total loans held for investment, net |
4,328.8 |
0.97 |
6.46 |
|||
|
Total deposits |
5,368.7 |
(0.81) |
0.10 |
|||
|
Equity to assets ratio |
8.58 % |
33 |
bps |
77 |
bps |
|
|
Tangible common equity ratio (non-GAAP) |
7.22 |
34 |
68 |
|||
|
CET1 risk-based capital ratio |
9.91 |
35 |
39 |
|||
|
Total risk-based capital ratio |
12.96 |
34 |
51 |
|||
|
Loans to deposits ratio |
80.63 |
142 |
482 |
Profitability
Credit Risk
Profile
|
Net interest margin, tax equivalent (non-GAAP) |
2.51 % |
10 |
bps |
16 |
bps |
|
|
Cost of total deposits |
2.14 |
3 |
43 |
|||
|
Retuon average assets |
(5.78) |
(673) |
(634) |
|||
|
Efficiency ratio (non-GAAP) |
70.32 |
1,403 |
426 |
|||
|
Diluted EPS |
$ |
(6.05) |
(705) |
% |
(1143) |
% |
|
Adjusted EPS (non-GAAP) |
0.58 |
12 |
4 |
|||
|
Nonperforming loans ratio |
0.51 % |
(8) |
bps |
(20) |
bps |
|
|
Nonperforming assets ratio |
0.39 |
(8) |
(6) |
|||
|
Net charge-off ratio |
0.16 |
11 |
12 |
|||
|
Allowance for credit losses ratio |
1.25 |
(1) |
(2) |
|||
|
- |
See the section "Non-GAAP Financial measures." |
3 |
|
- |
Note: Financial metrics as of or for the quarter ended |
Capital Raise & Balance Sheet Repositioning
Transaction Details(1)
|
Capital Raise (net proceeds) |
|
|
Securities Sold (market value): |
|
|
Average Yield on Securities Sold: |
1.58% |
|
|
|
|
Average Yield on |
4.65% |
|
Funding Paid Down: |
$418.7 million(2) |
|
Weighted Avg Cost of Funding Paid Down: |
4.77% |
(1)Transaction details are as of 10/21/24.
(2)Represents
4
Company Focus
MOFG's Five Strategic Pillars to Deliver Improved Results
Exceptional Customer and Employee Engagement
Strong Core Local Banking Model
Sophisticated Commercial Banking and Wealth Management
Specialty Business Lines
Improving our Efficiency and Operations
1
2
3
4
5
Enhance MOFG's award winning culture with a continued focus on performance and financial results
Protect and enhance MOFG's dominant community bank franchise through product expansion
Continue to hire exceptional relationship bankers and wealth management professionals
Develop specialty commercial banking verticals by continuing to attract experienced professionals
Continue to identify and execute on opportunities for efficiency gains and cost reduction
5
What We Have Accomplished
Strategic Plan Updates
☑☑
☑
☑☑
|
Geographic |
Talent |
|
Realignment |
Transformation |
|
Sale of |
Robust talent |
|
branches (7.5% |
acquisition |
|
deposit premium) |
strategy installing |
|
and Acquisition of |
senior leaders, |
|
|
product |
|
in first half of |
management, IT |
|
2024 |
resources and |
|
revenue |
|
|
producers across |
|
|
target markets |
Commercial
Growth
Annualized commercial & industrial ("C&I") and commercial real estate ("CRE") loan growth was 11% and 3%, respectively, for the third quarter of 2024
Wealth
Continued momentum in Wealth Management, with year-to-date revenue growth of 15% compared to the prior year
(through third quarter)
Operational
Efficiency
Completed a common equity capital raise during the third quarter of 2024, with proceeds used to support a balance sheet repositioning executed early in the fourth quarter of 2024
6
Diversified and Granular Loan Portfolio
|
Loans Held for Investment |
LTM Commercial Loan Growth in Targeted Regions(2) |
|
Consumer, 2% |
Agricultural, 3% |
|
|
C&I, 27%
billion
|
CRE-Other, 31% |
Construction & |
|
Development, 9% |
Farmland, 4%
Multifamily, 9%
+14%
+16%
+19%
+$82 million(3)
$1,090
|
|
|
|
|
5.86% Yield(4) |
< |
|
Avg. Commercial |
|
|
Loan Size(1) |
|
Financial Information as of |
||
|
(1)Average net nonaccrual active principal balance of the commercial loan portfolio. |
||
|
(2) |
Commercial loan net active principal balances reported in millions ($). |
|
|
(3) |
Excludes |
|
|
acquisition. |
||
|
(4) |
Non-GAAP Measure. See the Non-GAAP measures section for a reconciliation of the most directly comparable |
7 |
|
GAAP measure. |
Credit Quality
Nonperforming Assets
$30.3
$ millions
|
|
|
|
|
|
Credit Quality Measures
|
$ millions |
3Q23 |
4Q23 |
1Q24 |
2Q24 |
3Q24 |
|
Nonperforming assets ratio |
0.45 % |
0.47 % |
0.49 % |
0.47 % |
0.39 % |
|
Net charge-off ratio |
0.04 % |
0.20 % |
0.02 % |
0.05 % |
0.16 % |
|
Loans greater than 30 days past due and |
|
|
|
|
|
|
accruing |
|||||
|
Allowance for credit losses ratio |
1.27 % |
1.25 % |
1.27 % |
1.26 % |
1.25 % |
Net Charge-Offs
|
millions$ |
|
|
|||
|
|
|
|
|||
|
3Q23 |
4Q23 |
1Q24 |
2Q24 |
3Q24 |
8
Non-Owner Occupied CRE Office
3.6%
96.4%
|
NOO CRE Office |
All Other Loans |
Portfolio Highlights
|
Average NOO CRE Office outstanding principal ($ millions) |
$ |
1.4 |
|||||||
|
% of Total Capital |
|||||||||
|
Regulatory |
|||||||||
|
Commercial Real Estate Concentration: |
3Q24 |
2Q24 |
Threshold |
||||||
|
Construction, land development and other land |
56% |
52% |
100% |
||||||
|
Total CRE loans(1) |
232% |
237% |
300% |
||||||
|
Commercial Real Estate Portfolio(2) |
|||||||||
|
|
|||||||||
|
$ millions |
3Q24 |
2Q24 |
|||||||
|
Construction & Development |
$ |
386.9 |
$ |
351.6 |
|||||
|
Farmland |
182.2 |
183.6 |
|||||||
|
Multifamily |
409.5 |
430.1 |
|||||||
|
CRE Other: |
|||||||||
|
NOO CRE Office |
154.7 |
157.1 |
|||||||
|
OO CRE Office |
84.6 |
84.6 |
|||||||
|
Industrial and Warehouse |
403.5 |
407.3 |
|||||||
|
Retail |
282.4 |
262.0 |
|||||||
|
Hotel |
111.7 |
112.8 |
|||||||
|
Other |
316.6 |
324.7 |
|||||||
|
|
$ |
2,332.1 |
$ |
2,313.8 |
|
(1)Total CRE loans includes construction, land development and other land, in |
9 |
|
addition to multifamily and NOO CRE. |
(2) Represents the amortized cost of the CRE portfolio.
Focusing on Growth in Wealth Management
Private Banking
- Right-sizebook of business with consistent eligibility
- Launched new concierge support
- Building out product set
- Added a new Senior Private Banker in
Des Moines andDenver during 2024
Private Wealth
- Enhance planning with a single platform across Private Wealth and Investment Services
- Reviewing platform options to dramatically enhance investment offering in the first quarter of 2025
- Increase focus on thought leadership
- Enhance fee opportunities with fiduciary services and proprietary investments
Investment Services
- Adding advisors in
Twin Cities &Denver - Focus on building recurring revenue through fee-based business
|
$- |
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|
2020 |
2021 |
2022 |
2023 |
3Q24 |
Investment Services and Private Wealth Revenue
|
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2020 |
2021 |
2022 |
2023 |
YTD 3Q24 |
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|
Investment Services |
Private Wealth |
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- Asset amounts presented are in billions of dollars
- Revenue amounts presented are in millions of dollars
10
| Attention: This is an excerpt of the original content. To continue reading it, access the original document here. |
Attachments
Disclaimer
Proxy Statement – Form DEF 14A
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