Flagstar Bank, N.A. · NYSE:FLG
Flagstar Bank, N.A — New York Community Bancorp — Q2 2024 Earnings Presentation
25 slides from Flagstar Bank, N.A's earnings presentation, Jul 25, 2024
Slide 1: Second Quarter 2024 Results
Second Quarter 2024 Results July 25, 2024
Slide 2: Cautionary Statement
Cautionary Statement Forward-Looking Information The presentation may include forward‐looking statements within the meaning of the federal securities laws by the Company pertaining to such matters as our goals, intentions, and expectations regarding (a) revenues, earnings, loan production, asset qua
Slide 3: Strategic Update
Strategic Update Significant Progress Continues in Our Transition Year 1 2 3 4 5 Bolster Management Ongoing Execution of Achievable Capital and Improve Funding Focus on Credit Risk and Board Operating Plan Earnings Forecast Profile Management ▪ Board ▪ 5.6% deposit ▪ Strategic sales add ▪ Pro-forma
Slide 4: Positive Momentum Continued During Second Quarter 2024 On Our Business Plan
Positive Momentum Continued During Second Quarter 2024 On Our Business Plan Key Takeaways 1 Meaningfully Enhanced Liquidity and Capital 2 Grew Deposits In Areas of Key Focus Including Retail and Private Banking 3 Meaningful CRE Payoffs at Par, Including Nearly 50% in Classified Categories 4 Further
Slide 5: Meaningfully Revamped Senior Leadership and Key Functional Areas
Meaningfully Revamped Senior Leadership and Key Functional Areas Overhauled Majority of Executive Management Since Capital Infusion Rebuilt Credit, Risk, Audit and Finance Functions From the Top Down Joseph Otting Craig Gifford Reginald Davis Executive Chairman, President & Chief Senior Executive Vi
Slide 6: Divestiture Update
Divestiture Update • Sold ~$6.1 billion in loans at par Mortgage • Adds approximately 70 bps to CET1 ratio 1 Warehouse • Proceeds will be used to pay down wholesale borrowings and fund future C&I loan growth • At closing, will add approximately 60 bps to CET1 ratio • Will reduce high cost, volatile
Slide 7: Capital and Liquidity Position
Capital and Liquidity Position $50 – 100B Asset NYCB Flagstar NYCB Flagstar NYCB Flagstar Category IV Banks Banks Q4’23 Q1’24 Q2’24 Most Recent Available Most Recent Available CET1 Ratio, as Converted (Pro-forma for warehouse and 9.0% 10.1%(1) 11.2%(1) 10.6% 11.0% mortgage sale) CET1 Ratio, as Conve
Slide 8: Forecast Update
Forecast Update Includes impact from the Mortgage Warehouse and Mortgage Servicing sales Q4’26 Q2’27 2024 2025 2026 Annualized Annualized Diluted Core EPS(1)(2) ($2.20 – 2.30) $0.00 – 0.05 $1.25 – 1.30 $1.60 – 1.70 $2.00 – 2.10 Efficiency Ratio(3) 90 – 95% 75 – 80% 55 – 60% 50 – 55% 50 – 55% CET1 Ra
Slide 9: Forecast Update (cont'd)
Forecast Update (cont’d) Includes impact from the Mortgage Warehouse and Mortgage Servicing sales Q4’26 Q2’27 ($ in millions) 2024 2025 2026 Annualized Annualized Net Interest Income $2,200 – 2,250 $2,200 – 2,250 $2,800 – 2,900 $2,950 – 3,050 $3,050 – 3,150 Net Interest Margin 2.00 – 2.10% 2.05 – 2.
Slide 10: Significant CRE Portfolio Payoffs
Significant CRE Portfolio Payoffs CRE Portfolio Payoffs During Q2’24 Payoffs as a % of Loan Payoffs Category Classified (%) Multi-Family $714 million 2.0% 45% Office $110 million 4.2% 94% Non-Office CRE $108 million 2.1% 24% Total CRE $932 million 2.1% 48% Nearly half of the payoffs were from classi
Slide 11: Loan Portfolio | In-Depth Review
Loan Portfolio | In-Depth Review Total Loans HFI: Multi-Family and CRE: In-Depth MF and CRE Review: $74.6 Billion $43.9 Billion (UPB) $32.8 Billion UPB or 75% Reviewed Non-Office Other CRE(2) Non-Office $1.8 $7.1 CRE Multi-Family 2% 16% $3.4B $33.9 Co-op 45% $2.1 Office (2) 3% $2.8 Office 1-4 Family
Slide 12: Multi-Family Portfolio | Overview
Multi-Family Portfolio | Overview Proactively Reducing Multi-Family Exposure(1) Highlights $ in billions ◼ Q2’24 Multi-Family, excluding Co-op, portfolio ALLL: -4.2% 1.81% | Increased from 1.36% in Q1’24 $35.4 ◼ Increase in loan loss reserve reflects impact of $35.2 $34.8 continued higher rates and
Slide 13: Multi-Family Portfolio | In-Depth Review
Multi-Family Portfolio | In-Depth Review Multi-Family Portfolio Reviewed (UPB) Highlights ◼ 80% of total Multi-family loans reviewed to date ◼ 100% of the largest loans have been reviewed Reviewed Under $27.1B Review 80% $6.9B 20% Multi-Family Portfolio Profile (UPB) Option/Contractual Maturity per
Slide 14: Office Portfolio | In-Depth Review
Office Portfolio | In-Depth Review Office Portfolio Reviewed (UPB) Highlights ◼ Already reviewed 82% of office portfolio, remaining is smaller balance loans ◼ ALLL coverage on Office portfolio was lower QoQ driven by increase in chargeoffs Reviewed Under $2.3B Review 82% $0.5B ◼ When chargeoffs for
Slide 15: Non-Office CRE Portfolio | Overview
Non-Office CRE Portfolio | Overview Total Non-Office CRE Portfolio Reviewed (UPB)(1) Highlights ◼ Q2’24 Non-Office CRE portfolio ALLL: 1.88%, or 2.19% excluding owner-occupied ◼ In-depth reviews performed on 48% of the portfolio Reviewed Under ◼ Most loans under review are non-New York City small $3
Slide 16: Asset Quality | Allowance for Credit Loss Detail
Asset Quality | Allowance for Credit Loss Detail ACL as a % to LHFI increased to 1.78% (+$40 Million) 3/31/2024 6/30/2024 Change in ($ in millions) Allowance ALLL % Allowance ALLL % ALLL % Multi-Family $479 1.30% $618 1.71% 41bps Multi-Family (excl. Co-op) $472 1.36% $613 1.81% 45bps Co-op $7 0.33%
Slide 17: Asset Quality
Asset Quality Total Loans 30 to 89 Days Past Due Highlights ◼ Total loans 30 to 89 days past due increased to $1.2 billion at quarter-end compared to 1Q’24 ◼ Of the $1.2 billion of 30 to 89 days past due, $0.7 billion were current as of Jully 24 ◼ Adjusting for current loans as of July 24, total loa
Slide 18: Deposits | Overview
Deposits | Overview Well Diversified Deposit Base by Product 84% Insured and Collateralized Deposits Balance ($B) Industry 6/30/2024 Noninterest-Bearing Demand 42% of $17.9 Interest-Bearing Demand Total $15.3 Insured Money Markets $6.4 84% Uninsured Savings $10.6 16% Retail CDs $22.4 Jumbo CDs $6.4
Slide 19: Liquidity Sources vs. Uninsured Deposits
Liquidity Sources vs. Uninsured Deposits Significant Liquidity Capacity Relative to Uninsured Deposits $ in billions Highlights $39.7 ▪ Our liquidity profile improved significantly compared to prior quarter $5.9 Warehouse Sale Proceeds ▪ Pro-forma total liquidity of $39.7 billion when including $5.9
Slide 20: Q2 2024 Financial Highlights: Income Statement Summary
Q2 2024 Financial Highlights ($ in millions) NYCB Flagstar 6/30/24 Net Interest Income $557 INCOME STATEMENT SUMMARY Noninterest Income $114 Noninterest Expense(1) $638 Provision for Loan Losses $390 Net Income / (Loss) to Common Shareholders ($333) Diluted Earnings / (Loss) per Common Share ($1.14)
Slide 21: Investment Profile
Investment Profile ◼ Pro-forma for the capital raise, NYCB currently trades at approximately 0.60x of fully converted tangible book value, compared to 1.82x for Category IV banks and 1.55x for banks with assets between $50 - $100 billion ◼ Q2’24 TBV Per Share: $20.89 or $18.29 fully converted ◼ Q2’2
Slide 22: Appendix
Appendix
Slide 23: Reconciliations of GAAP and Non-GAAP Measures
Reconciliations of GAAP and Non-GAAP Measures Tangible Book Value Per Share - As Preferred Converted and Post-Share Split 6/30/2024 Total stockholders equity $8,397 Less: Core deposit and other intangibles 557 Less: Preferred stock 503 Tangible common stockholders equity (A) 7,338 Add: Preferred sha
Slide 24: Peer Groups
Peer Groups Category IV Banks Ticker Banks with $50B - $100B in Assets Ticker Citizens Financial CFG BOK Financial BOKF Fifth Third Bancorp FITB Columbia Banking System COLB First Citizens Banc. FCNC.A Comerica CMA Huntington Banc. HBAN East West Bancorp EWBC KeyCorp KEY First Horizon FHN M&T Bank M
Slide 25: For More Information
For More Information Visit our website: ir.myNYCB.com E-mail requests to: [email protected] Call Investor Relations at: (516) 683-4420 Investor Relations Write to: New York Community Bancorp, Inc. 102 Duffy Avenue Hicksville, NY 11801 2nd Quarter 2024 25
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