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S&T Bancorp, Inc. Announces Third Quarter 2020 Results

INDIANA, Pa., Oct. 22, 2020 /PRNewswire/ -- S&T Bancorp, Inc. (S&T) (NASDAQ: STBA), the holding company for S&T Bank, with operations in five markets including Western Pennsylvania, Eastern Pennsylvania, Northeast Ohio, Central Ohio and Upstate New York, announced net income of $16.7 million, or $0.43 per diluted share, for the third quarter of 2020 compared to a net loss of ($33.1) million, or ($0.85) per diluted share, for the second quarter of 2020, and net income of $26.9 million, or $0.79 per diluted share, for the third quarter of 2019. The net loss in the second quarter of 2020 was due to a customer fraud resulting from a check kiting scheme which reduced net income by $46.3 million, or $1.19 per diluted share. S&T continues to pursue all available sources of recovery to mitigate the loss.

S&T Bancorp, Inc. (PRNewsfoto/S&T Bancorp, Inc.)

Third Quarter of 2020 Highlights:

  • Return on average assets (ROA) was 0.72%, return on average equity (ROE) was 5.80% and return on average tangible equity (ROTE) (non-GAAP) was 8.96%. Pre-tax pre-provision to average assets  (non-GAAP) was 1.61%.
  • Net interest margin (FTE) (non-GAAP) was  stable at 3.29% compared to 3.31% for the second quarter of 2020. 
  • Portfolio loans decreased $153.7 million compared to June 30, 2020. 
  • Deposits decreased $234.1 million to $7.6 billion at September 30, 2020 due to the pay down of $269.0 million of brokered deposits during the third quarter.
  • Mortgage banking revenue increased $1.3 million compared to the second quarter due to continued strong refinance activity.
  • The allowance for credit losses to total portfolio loans  was 1.64% at September 30, 2020 compared to 1.52% at June 30, 2020. Excluding PPP loans, the allowance for credit losses to total portfolio loans was 1.77% at September 30, 2020 compared to 1.64% at June 30, 2020.
  • S&T's Board of Directors declared a $0.28 per share dividend which was consistent with the $0.28 per share dividend declared in the same period in the prior year.

We continue to navigate through this difficult environment related to the COVID-19 pandemic," said Todd Brice, Chief Executive Officer. "I have every confidence in the S&T team to work through these difficult times, and I am impressed by their strong resilience and desire to help our customers and communities."

Net Interest Income

Net interest income decreased $0.8 million to $69.3 million for the third quarter of 2020 compared to $70.1 million for the second quarter of 2020. The decrease in net interest income was primarily due to lower loan balances as lower yields on loans were mostly offset by decreased rates on deposits.  Average loans decreased $154.2 million compared to the second quarter of 2020. Net interest margin on a fully taxable equivalent basis (FTE) (non-GAAP) was stable at 3.29% for the third quarter of 2020 compared to 3.31% in the second quarter of 2020. Loan rates decreased 13 basis points to 3.87% and total interest-bearing deposit costs decreased 19 basis points to 0.48%.

Asset Quality

The provision for credit losses was $17.5 million for the third quarter of 2020 compared to $86.8 million in the second quarter of 2020. The customer fraud that resulted in a $58.7 million charge-off to the bank had a significant impact on the provision for credit losses during the second quarter of 2020. Net loan charge-offs were $12.9 million for the third quarter of 2020 compared to $68.1 million in the second quarter of 2020.  During the third quarter, a $21.3 million CRE relationship, which was placed on nonaccrual in the first quarter of 2020, was charged down by $10.0 million leaving a remaining outstanding balance of $11.3 million. The relationship experienced continued deterioration as a result of the COVID-19 pandemic. Total nonperforming loans decreased $6.0 million to $84.1 million, or 1.13% of total loans, at September 30, 2020 compared to $90.1 million, or 1.19% of total loans at June 30, 2020. The allowance for credit losses was 1.64% of total portfolio loans as of September 30, 2020 compared to 1.52% at June 30, 2020. Excluding PPP loans, the allowance for credit losses was 1.77% of total portfolio loans at September 30, 2020 compared to 1.64% at June 30, 2020. The impact of  the COVID-19 pandemic on our hotel loan portfolio and a $6.2 million increase in specific reserves contributed to the higher allowance for credit losses at September 30, 2020 compared to June 30, 2020.

Noninterest Income and Expense

Noninterest income increased $1.3 million to $16.5 million in the third quarter of 2020 compared to $15.2 million in the second quarter of 2020. Mortgage banking income increased $1.3 million compared to the second quarter of 2020 due to continued strong refinance activity. Both debit and credit card fees and service charges on deposit accounts increased due to improved customer activity compared to the second quarter of 2020.

Noninterest expense increased $4.8 million to $48.3 million for the third quarter of 2020 compared to $43.5 million in the second quarter of 2020. Salaries and employee benefits increased $3.2 million due to lower deferred origination costs related to PPP loans, higher pension costs due to an increase in retirements and a return to more normal medical costs compared to the second quarter of 2020. FDIC insurance increased $0.9 million due to the impact of recent results on certain components of the assessment calculation. Marketing expense increased $0.8 million due to the timing of marketing initiatives and the redesign of our website.

Financial Condition

Total assets decreased $283.7 million to $9.2 billion at September 30, 2020 compared to $9.5 billion at June 30, 2020. Portfolio loans decreased $153.7 million compared to June 30, 2020 as loan originations continue to be impacted by the COVID-19 pandemic. The securities portfolio declined $86.2 million compared to June 30, 2020 mainly due to short term investments maturing in conjunction with our planned reduction of $269 million in brokered deposits. The decrease in brokered deposits resulted in a decline in total deposits of $234.1 million to $7.6 billion at September 30, 2020 compared to $7.9 billion at June 30, 2020. Customer deposits, which increased significantly during the second quarter of 2020, remained relatively unchanged in the third quarter despite decreases in deposit rates.

All regulatory  capital ratios increased at September 30, 2020 compared to June 30, 2020. S&T continues to maintain a strong capital position with all capital ratios above the well-capitalized thresholds of federal bank regulatory agencies.

Dividend

The Board of Directors of S&T declared a $0.28 per share cash dividend on October 19, 2020. This is unchanged from the same period in the prior year. The dividend is payable November 19, 2020 to shareholders of record on November 5, 2020.

Conference Call

S&T will host its third quarter 2020 earnings conference call live over the Internet at 1:00 p.m. ET on Thursday, October 22, 2020. To access the webcast, go to S&T's webpage at www.stbancorp.com and click on "Events & Presentations." Select "3rd Quarter 2020 Earnings Conference Call" and follow the instructions. After the live presentation, the webcast will be archived on this website for at least 90 days. A replay of the call will also be available until October 29, 2020, by dialing 1.877.481.4010; the Conference ID is 37817.

About S&T Bancorp, Inc. and S&T Bank

S&T Bancorp, Inc. is a $9.2 billion bank holding company that is headquartered in Indiana, Pennsylvania and trades on the NASDAQ Global Select Market under the symbol STBA. Its principal subsidiary, S&T Bank, was recently ranked #1 in customer satisfaction with retail banking in the Mid-Atlantic including best in communication and advice by J.D. Power. Established in 1902, S&T Bank operates in five markets including Western Pennsylvania, Eastern Pennsylvania, Northeast Ohio, Central Ohio, and Upstate New York. For more information visit stbancorp.com or stbank.com. Follow us on Facebook, Instagram, and LinkedIn.

This information contains or incorporates statements that we believe are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally relate to our financial condition, results of operations, plans, objectives, outlook for earnings, revenues, expenses, capital and liquidity levels and ratios, asset levels, asset quality, financial position, and other matters regarding or affecting S&T and its future business and operations. Forward-looking statements are typically identified by words or phrases such as "will likely result", "expect", "anticipate", "estimate", "forecast", "project", "intend", " believe", "assume", "strategy", "trend", "plan", "outlook", "outcome", "continue", "remain", "potential", "opportunity", "believe", "comfortable", "current", "position", "maintain", "sustain", "seek", "achieve" and variations of such words and similar expressions, or future or conditional verbs such as will, would, should, could or may. Although we believe the assumptions upon which these forward-looking statements are based are reasonable, any of these assumptions could prove to be inaccurate and the forward-looking statements based on these assumptions could be incorrect. The matters discussed in these forward-looking statements are subject to various risks, uncertainties and other factors that could cause actual results and trends to differ materially from those made, projected, or implied in or by the forward-looking statements depending on a variety of uncertainties or other factors including, but not limited to: credit losses and the credit risk of our commercial and consumer loan products; changes in the level of charge-offs and changes in estimates of the adequacy of the allowance for credit losses; cyber-security concerns; rapid technological developments and changes; operational risks or risk management failures by us or critical third parties, including fraud risk; our ability to manage our reputational risks; sensitivity to the interest rate environment including a prolonged period of low interest rates, a rapid increase in interest rates or a change in the shape of the yield curve; a change in spreads on interest-earning assets and interest-bearing liabilities; regulatory supervision and oversight, including changes in regulatory capital requirements and our ability to address those requirements; unanticipated changes in our liquidity position; changes in accounting policies, practices, or guidance, for example, our adoption of CECL; legislation affecting the financial services industry as a whole, and S&T, in particular; the outcome of pending and future litigation and governmental proceedings; increasing price and product/service competition; the ability to continue to introduce competitive new products and services on a timely, cost-effective basis; managing our internal growth and acquisitions; the possibility that the anticipated benefits from acquisitions, including DNB, cannot be fully realized in a timely manner or at all, or that integrating the acquired operations will be more difficult, disruptive or costly than anticipated; containing costs and expenses; reliance on significant customer relationships; an interruption or cessation of an important service by a third-party provider; our ability to attract and retain talented executives and employees; general economic or business conditions, including the strength of regional economic conditions in our market area; the duration and severity of the coronavirus ("COVID-19") pandemic, both in our principal area of operations and nationally, including the ultimate impact of the pandemic on the economy generally and on our operations; deterioration of the housing market and reduced demand for mortgages; deterioration in the overall macroeconomic conditions or the state of the banking industry that could warrant further analysis of the carrying value of goodwill and could result in an adjustment to its carrying value resulting in a non-cash charge to net income; the stability of our core deposit base and access to contingency funding; re-emergence of turbulence in significant portions of the global financial and real estate markets that could impact our performance, both directly, by affecting our revenues and the value of our assets and liabilities, and indirectly, by affecting the economy generally and access to capital in the amounts, at the times and on the terms required to support our future businesses.

Many of these factors, as well as other factors, are described in our Annual Report on Form 10-K for the year ended December 31, 2019, including Part I, Item 1A-"Risk Factors" and any of our subsequent filings with the SEC. Forward-looking statements are based on beliefs and assumptions using information available at the time the statements are made. We caution you not to unduly rely on forward-looking statements because the assumptions, beliefs, expectations and projections about future events may, and often do, differ materially from actual results. Any forward-looking statement speaks only as to the date on which it is made, and we undertake no obligation to update any forward-looking statement to reflect developments occurring after the statement is made.

S&T Bancorp, Inc.

Consolidated Selected Financial Data

Unaudited



2020


2020


2019



Third


Second


Third


(dollars in thousands, except per share data)

Quarter


Quarter


Quarter


INTEREST AND DIVIDEND INCOME







Loans, including fees

$72,263



$75,498



$75,080



Investment securities:







Taxable

3,473



3,791



3,552



Tax-exempt

885



959



787



Dividends

227



231



394



Total Interest and Dividend Income

76,848



80,479



79,813










INTEREST EXPENSE







Deposits

6,626



9,227



16,207



Borrowings and junior subordinated debt securities

946



1,104



2,410



Total Interest Expense

7,572



10,331



18,617










NET INTEREST INCOME

69,276



70,148



61,196



Provision for credit losses

17,485



86,759



4,913



Net Interest Income (Loss) After Provision for Credit Losses

51,791



(16,611)



56,283










NONINTEREST INCOME







Net gain on sale of securities



142





Debit and credit card

4,171



3,612



3,475



Mortgage banking

3,964



2,623



594



Service charges on deposit accounts

2,820



2,342



3,412



Wealth management

2,522



2,586



2,101



Commercial loan swap income

499



945



1,464



Other

2,507



2,974



2,017



Total Noninterest Income

16,483



15,224



13,063










NONINTEREST EXPENSE







Salaries and employee benefits

24,571



21,419



19,936



Data processing and information technology

4,218



3,585



3,681



Net occupancy

3,441



3,437



2,898



Furniture, equipment and software

2,440



3,006



2,090



Professional services and legal

1,911



1,932



1,054



FDIC insurance

1,900



1,048



(675)



Marketing

1,793



979



1,062



Other taxes

1,612



1,604



1,540



Merger related expense





552



Other

6,360



6,468



5,529



Total Noninterest Expense

48,246



43,478



37,667



Income (Loss)  Before Taxes

20,028



(44,865)



31,679



Income tax  expense (benefit)

3,323



(11,793)



4,743



Net Income (Loss)

$16,705



($33,072)



$26,936










Per Share Data







Shares outstanding at end of period

39,251,638



39,253,460



34,244,719



Average shares outstanding - diluted

39,020,811



39,013,161



34,277,270



Diluted earnings (loss) per share

$0.43



($0.85)



$0.79



Dividends declared per share

$0.28



$0.28



$0.27



Dividend yield (annualized)

6.33%



4.78%



2.96%



Dividends paid to net income

65.61%



NM



34.30%



Book value

$29.10



$28.93



$28.69



Tangible book value (1)

$19.40



$19.22



$20.25



Market value

$17.69



$23.45



$36.53



Profitability Ratios (Annualized)







Return on average assets

0.72%



(1.41%)



1.45%



Return on average shareholders' equity

5.80%



(11.17%)



10.97%



Return on average tangible shareholders' equity (2)

8.96%



(16.19%)



15.69%



Efficiency ratio (FTE) (3)

55.75%



50.51%



50.09%



NM - Not Meaningful







 

S&T Bancorp, Inc.

Consolidated Selected Financial Data

Unaudited




Nine Months Ended September 30,


(dollars in thousands, except per share data)


2020


2019


INTEREST INCOME






Loans, including fees


$229,812



$223,200



Investment securities:






Taxable


11,547



10,989



Tax-exempt


2,646



2,466



Dividends


911



1,373



Total Interest and Dividend Income


244,916



238,028









INTEREST EXPENSE






Deposits


31,191



47,243



Borrowings and junior subordinated debt securities


4,265



8,406



Total Interest Expense


35,456



55,649









NET INTEREST INCOME


209,460



182,379



Provision for credit  losses


124,294



12,767



Net Interest Income After Provision for Credit Losses


85,166



169,612









NONINTEREST INCOME






Net gain on sale of securities


142





Debit and credit card


11,264



9,951



Mortgage banking


7,823



1,726



Service charges on deposit accounts


8,720



9,777



Wealth management


7,471



6,210



Commercial swap fee income


3,928



3,147



Other


4,762



6,515



Total Noninterest Income


44,110



37,326









NONINTEREST EXPENSE






Salaries and employee benefits


67,326



61,135



Data processing and information technology


11,671



10,327



Net occupancy


10,643



8,883



Furniture, equipment and software


7,965



6,621



Professional services and legal


4,890



3,382



FDIC insurance


3,718



536



Marketing


3,883



3,514



Other taxes


4,816



4,182



Merger related expense


2,342



1,171



Other


20,861



17,187



Total Noninterest Expense


138,115



116,938









(Loss) Income Before Taxes


(8,839)



90,000



Income tax (benefit) expense


(5,703)



14,035









Net (Loss) Income


($3,136)



$75,965









Per Share Data






Average shares outstanding - diluted


39,101,309



34,407,732



Diluted (loss) earnings per share


($0.08)



$2.21



Dividends declared per share


$0.84



$0.81



Dividends paid to net income


NM



36.59%









Profitability Ratios (annualized)






Return on average assets


(0.05%)



1.40%



Return on average shareholders' equity


(0.36%)



10.61%



Return on average tangible shareholders' equity (6)


(0.27%)



15.30%



Efficiency ratio (FTE) (7)


53.06%



52.54%



NM - Not Meaningful






 

S&T Bancorp, Inc. 

Consolidated Selected Financial Data

Unaudited



2020


2020


2019



Third


Second


Third


(dollars in thousands)

Quarter


Quarter


Quarter


ASSETS







Cash and due from banks, including interest-bearing deposits

$308,489



$351,365



$173,609



Securities, at fair value

718,169



804,366



669,226



Loans held for sale

16,724



14,259



8,371



Commercial loans:







Commercial real estate

3,290,138



3,345,513



2,922,197



Commercial and industrial

2,042,467



2,140,355



1,626,854



Commercial construction

477,429



459,264



314,813



Total Commercial Loans

5,810,034



5,945,132



4,863,864



Consumer loans:







Residential mortgage

950,887



971,023



770,882



Home equity

537,869



539,519



475,024



Installment and other consumer

80,735



79,816



74,460



Consumer construction

15,343



13,068



11,535



Total Consumer Loans

1,584,834



1,603,426



1,331,901



Total Portfolio Loans

7,394,868



7,548,558



6,195,765



Allowance for credit losses

(120,998)



(114,609)



(62,115)



Total Portfolio Loans, Net

7,273,870



7,433,949



6,133,650



Federal Home Loan Bank and other restricted stock, at cost

15,777



15,151



25,397



Goodwill

373,417



373,289



287,446



Other assets

484,126



481,917



274,292



Total Assets

$9,190,572



$9,474,296



$7,571,991










LIABILITIES







Deposits:







Noninterest-bearing demand

$2,232,706



$2,250,958



$1,490,409



Interest-bearing demand

982,956



1,055,261



751,881



Money market

2,033,585



2,121,588



1,660,569



Savings

938,475



916,268



753,464



Certificates of deposit

1,446,096



1,523,841



1,326,369



Total Deposits

7,633,818



7,867,916



5,982,692










Borrowings:







Securities sold under repurchase agreements

42,706



92,159



13,925



Short-term borrowings

83,000



84,541



370,000



Long-term borrowings

49,076



49,489



69,156



Junior subordinated debt securities

64,068



64,053



45,619



Total Borrowings

238,850



290,242



498,700



Other liabilities

175,789



180,361



108,152



Total Liabilities

8,048,457



8,338,519



6,589,544










SHAREHOLDERS' EQUITY







Total Shareholders' Equity

1,142,115



1,135,777



982,447



Total Liabilities and Shareholders' Equity

$9,190,572



$9,474,296



$7,571,991










Capitalization Ratios







Shareholders' equity / assets

12.43%



11.99%



12.97%


Tangible common equity / tangible assets (4)

8.64%



8.30%



9.52%


Tier 1 leverage ratio

9.11%



8.89%



10.20%


Common equity tier 1 capital

11.05%



10.70%



11.17%


Risk-based capital - tier 1

11.46%



11.10%



11.49%


Risk-based capital - total

13.18%



12.74%



12.92%


 

S&T Bancorp, Inc.

Consolidated Selected Financial Data

Unaudited



2020


2020


2019



Third


Second


Third


(dollars in thousands)

Quarter


Quarter


Quarter


Net Interest Margin (FTE) (QTD Averages)







ASSETS







Interest-bearing deposits with banks

$213,051

0.11%

$163,019

0.08%

$53,725

2.32%

Securities, at fair value

759,094

2.41%

785,229

2.56%

661,752

2.59%

Loans held for sale

4,432

3.09%

9,931

3.08%

2,712

3.98%

Commercial real estate

3,322,656

4.02%

3,389,616

4.23%

2,922,767

4.89%

Commercial and industrial

2,107,750

3.45%

2,200,148

3.61%

1,566,369

5.06%

Commercial construction

469,214

3.43%

430,912

3.75%

282,175

5.14%

Total Commercial Loans

5,899,620

3.77%

6,020,676

3.97%

4,771,311

4.96%

Residential mortgage

954,861

4.33%

976,916

4.20%

753,649

4.41%

Home equity

536,735

3.73%

543,770

3.69%

469,567

5.36%

Installment and other consumer

79,649

6.47%

79,944

6.34%

72,606

7.10%

Consumer construction

14,475

4.32%

12,758

4.58%

11,056

5.39%

Total Consumer Loans

1,585,720

4.24%

1,613,388

4.14%

1,306,878

4.91%

Total Portfolio Loans

7,485,340

3.87%

7,634,064

4.00%

6,078,189

4.95%

Total Loans

7,489,772

3.87%

7,643,995

4.00%

6,080,901

4.95%

Federal Home Loan Bank and other restricted stock

15,157

5.11%

19,709

3.75%

19,981

7.00%

Total Interest-earning Assets

8,477,074

3.65%

8,611,952

3.80%

6,816,359

4.70%

Noninterest-earning assets

815,930


817,767


538,514


Total Assets

$9,293,004


$9,429,719


$7,354,873









LIABILITIES AND SHAREHOLDERS' EQUITY







Interest-bearing demand

$967,735

0.18%

$1,033,905

0.24%

$655,735

0.72%

Money market

2,074,862

0.33%

2,076,483

0.50%

1,709,248

1.83%

Savings

923,208

0.07%

887,357

0.07%

749,287

0.24%

Certificates of deposit

1,486,016

1.16%

1,560,885

1.51%

1,345,474

1.97%

Total Interest-bearing Deposits

5,451,821

0.48%

5,558,630

0.67%

4,459,744

1.44%

Securities sold under repurchase agreements

64,000

0.25%

85,302

0.25%

14,030

0.73%

Short-term borrowings

84,310

0.38%

178,273

0.38%

218,799

2.47%

Long-term borrowings

49,269

2.52%

49,774

2.53%

69,421

2.68%

Junior subordinated debt securities

64,057

3.19%

64,044

3.58%

45,619

4.82%

Total Borrowings

261,636

1.44%

377,393

1.18%

347,869

2.75%

Total Interest-bearing Liabilities

5,713,457

0.53%

5,936,023

0.70%

4,807,613

1.54%

Noninterest-bearing liabilities

2,433,665


2,302,676


1,573,549


Shareholders' equity

1,145,882


1,191,020


973,711


Total Liabilities and Shareholders' Equity

$9,293,004


$9,429,719


$7,354,873









Net Interest Margin (5)


3.29%


3.31%


3.62%








 

S&T Bancorp, Inc.

Consolidated Selected Financial Data

Unaudited




Nine Months Ended September 30,


(dollars in thousands)


2020


2019


Net Interest Margin (FTE) (YTD Averages)






ASSETS






Interest-bearing deposits with banks


$158,771

0.38%

$52,421

2.38%

Securities, at fair value


776,995

2.50%

671,727

2.65%

Loans held for sale


5,407

3.17%

1,693

4.11%

Commercial real estate


3,373,466

4.33%

2,907,792

4.97%

Commercial and industrial


2,020,179

3.82%

1,544,962

5.14%

Commercial construction


428,977

3.91%

258,239

5.28%

Total Commercial Loans


5,822,622

4.12%

4,710,993

5.04%

Residential mortgage


974,144

4.24%

736,972

4.43%

Home equity


540,220

4.09%

466,936

5.41%

Installment and other consumer


79,757

6.60%

71,021

7.17%

Consumer construction


12,587

4.49%

10,517

5.63%

Total Consumer Loans


1,606,708

4.31%

1,285,446

4.95%

Total Portfolio Loans


7,429,330

4.16%

5,996,439

5.02%

Total Loans


7,434,737

4.16%

5,998,132

5.02%

Federal Home Loan Bank and other restricted stock


19,473

5.38%

21,848

7.55%

Total Interest-earning Assets


8,389,976

3.94%

6,744,128

4.77%

Noninterest-earning assets


772,404


526,788


Total Assets


$9,162,380


$7,270,916








LIABILITIES AND SHAREHOLDERS' EQUITY






Interest-bearing demand


$981,174

0.33%

$584,280

0.54%

Money market


2,048,466

0.69%

1,658,187

1.88%

Savings


880,673

0.12%

760,128

0.25%

Certificates of deposit


1,549,177

1.50%

1,389,658

1.94%

Total Interest-bearing deposits


5,459,490

0.76%

4,392,253

1.44%

Securities sold under repurchase agreements


60,045

0.30%

17,812

0.63%

Short-term borrowings


182,623

1.02%

259,947

2.65%

Long-term borrowings


50,292

2.52%

69,886

2.79%

Junior subordinated debt securities


64,099

3.72%

45,619

5.02%

Total Borrowings


357,059

1.60%

393,264

2.86%

Total Interest-bearing Liabilities


5,816,549

0.81%

4,785,517

1.55%

Noninterest-bearing liabilities


2,170,447


1,528,573


Shareholders' equity


1,175,384


956,826


Total Liabilities and Shareholders' Equity


$9,162,380


$7,270,916








Net Interest Margin (8)



3.37%


3.67%

 

S&T Bancorp, Inc.

Consolidated Selected Financial Data

Unaudited



2020


2020


2019



Third


Second


Third


(dollars in thousands)

Quarter


Quarter


Quarter


Nonperforming Loans (NPL)







Commercial loans:


% NPL


% NPL


% NPL

Commercial real estate

$52,805


1.60%

$61,643


1.84%

$33,740


1.15%

Commercial and industrial

12,498


0.61%

8,484


0.40%

4,206


0.26%

Commercial construction

1,504


0.31%

1,504


0.33%

1,143


0.36%

Total Nonperforming Commercial Loans

66,807


1.15%

71,631


1.20%

39,089


0.80%

Consumer loans:







Residential mortgage

13,018


1.37%

14,649


1.51%

7,384


0.96%

Home equity

4,106


0.76%

3,814


0.71%

3,492


0.74%

Installment and other consumer

141


0.17%

19


0.02%

18


0.02%

Total Nonperforming Consumer Loans

17,265


1.08%

18,482


1.14%

10,894


0.81%

Total Nonperforming Loans

$84,072


1.13%

$90,113


1.19%

$49,983


0.81%
















2020


2020


2019



Third


Second


Third


(dollars in thousands)

Quarter


Quarter


Quarter


Loan Charge-offs (Recoveries)







Charge-offs

$13,667



$68,304



$4,700



Recoveries

(754)



(231)



(423)



Net Loan Charge-offs (Recoveries)

$12,913



$68,072



$4,277










Net Loan Charge-offs (Recoveries)







Commercial loans:







Customer fraud

$—



$58,671



$—



Commercial real estate

10,963



5,588



2,298



Commercial and industrial

1,267



3,060



1,257



Commercial construction

(1)



(19)



(1)



Total Commercial Loan Charge-offs (Recoveries)

12,229



67,300



3,554



Consumer loans:







Residential mortgage

274



74



289



Home equity

204



16



13



Installment and other consumer

206



682



421



Total Consumer Loan Charge-offs

684



772



723



Total Net Loan Charge-offs (Recoveries)

$12,913



$68,072



$4,277



 

S&T Bancorp, Inc.

Consolidated Selected Financial Data

Unaudited





Nine Months Ended September 30,


(dollars in thousands)



2020


2019


Loan Charge-offs (Recoveries)







Charge-offs



$93,415


$13,391



Recoveries



(1,273)


(1,743)



Net Loan Charge-offs (Recoveries)



$92,142


$11,648










Net Loan Charge-offs (Recoveries)







Commercial loans:







Customer fraud



$58,671


$—



Commercial real estate



16,979


2,699



Commercial and industrial



14,592


7,661



Commercial construction



(22)


(4)



Total Commercial Loan Charge-offs/(Recoveries)



90,220


10,356



Consumer loans:







Residential mortgage



367


251



Home equity



301


51



Installment and other consumer



1,254


1,072



Consumer construction




(82)



Total Consumer Loan Charge-offs



1,922


1,292



Total Net Loan Charge-offs (Recoveries)



$92,142


$11,648



 


2020


2020


2019



Third


Second


Third


(dollars in thousands)

Quarter


Quarter


Quarter


Asset Quality Data







Nonperforming loans

$84,072



$90,113



$49,983



OREO

2,317



2,740



1,724



Nonperforming assets

86,389



92,853



51,707



Troubled debt restructurings (nonaccruing)

18,648



31,755



14,496



Troubled debt restructurings (accruing)

18,478



15,536



38,434



Total troubled debt restructurings

37,126



47,291



52,930



Nonperforming loans / total loans

1.13%



1.19%



0.81%



Nonperforming assets / total loans plus OREO

1.17%



1.23%



0.83%



Allowance for credit losses / total portfolio loans

1.64%



1.52%



1.00%



Allowance for credit losses / nonperforming loans

144%



127%



124%



Net loan charge-offs (recoveries)

$12,913



$68,072



$4,277



Net loan charge-offs (recoveries)(annualized) / average loans

0.69%



3.58%



0.28%



 



Nine Months Ended September 30,


(dollars in thousands)


2020


2019


Asset Quality Data






Net loan charge-offs (recoveries)


$92,142



$11,648



Net loan charge-offs (recoveries)(annualized) / average loans


1.66%



0.26%



 

S&T Bancorp, Inc.

Consolidated Selected Financial Data

Unaudited


Definitions and Reconciliation of GAAP to Non-GAAP Financial Measures:



2020


2020


2019



Third


Second


Third



Quarter


Quarter


Quarter









(1) Tangible Book Value (non-GAAP)







 Total shareholders' equity

$1,142,115



$1,135,777



$982,447



      Less: goodwill and other intangible assets

(382,681)



(383,032)



(289,538)



     Tax effect of other intangible assets

1,946



2,046



439



 Tangible common equity (non-GAAP)

$761,380



$754,791



$693,348



 Common shares outstanding

39,252



39,263



34,245



 Tangible book value (non-GAAP)

$19.40



$19.22



$20.25










(2) Return on Average Tangible Shareholders' Equity (non-GAAP)







  Net (loss) income (annualized)

$66,455



($133,016)



$106,865



       Plus: amortization of intangibles (annualized)

2,619



2,623



647



       Tax effect of amortization of intangibles (annualized)

(550)



(551)



(136)



  Net (loss)  income before amortization of intangibles (annualized)

$68,524



($130,944)



$107,376










  Average total shareholders' equity

$1,145,882



$1,191,020



$973,711



       Less: average goodwill and other intangible assets

(382,780)



(384,197)



(289,622)



       Tax effect of average goodwill and other intangible assets

1,999



2,116



457



  Average tangible equity (non-GAAP)

$765,101



$808,939



$684,546



  Return on average tangible shareholders' equity (non-GAAP)

8.96%



(16.19%)



15.69%










(3) Efficiency Ratio (non-GAAP)







Noninterest expense

$48,246



$43,478



$37,667



Less: merger related expenses







Noninterest expense excluding nonrecurring items

$48,246



$43,478



$37,667










Net interest income per consolidated statements of net income

$69,276



$70,148



$61,196



     Less: net (gains) losses on sale of securities



(142)





     Plus: taxable equivalent adjustment

780



847



934



Net interest income (FTE) (non-GAAP)

$70,056



$70,853



$62,130



Noninterest income

16,483



15,224



13,063



Net interest income (FTE) (non-GAAP) plus noninterest income

$86,539



$86,077



$75,193



Efficiency ratio (non-GAAP)

55.75%



50.51%



50.09%










(4) Tangible Common Equity / Tangible Assets (non-GAAP)







 Total shareholders' equity

$1,142,115



$1,135,777



$982,447



      Less: goodwill and other intangible assets

(382,681)



(383,032)



(289,538)



      Tax effect of goodwill and other intangible assets

1,946



2,046



439



 Tangible common equity (non-GAAP)

$761,380



$754,791



$693,348










 Total assets

$9,190,572



$9,474,296



$7,571,991



      Less: goodwill and other intangible assets

(382,681)



(383,032)



(289,538)



      Tax effect of goodwill and other intangible assets

1,946



2,046



439



 Tangible assets (non-GAAP)

$8,809,837



$9,093,310



$7,282,892



 Tangible common equity to tangible assets (non-GAAP)

8.64%



8.30%



9.52%










(5) Net Interest Margin Rate (FTE) (non-GAAP)







 Interest income

$76,848



$80,479



$79,813



      Less: interest expense

7,572



10,331



(18,617)



 Net interest income per consolidated statements of net income

$69,276



$70,148



$61,196



      Plus: taxable equivalent adjustment

780



847



934



 Net interest income (FTE) (non-GAAP)

$70,056



$70,995



$62,130



 Net interest income (FTE) (annualized)

$278,701



$285,540



$246,494



 Average earning assets

$8,477,074



$8,611,952



$6,816,359



 Net interest margin - (FTE) (non-GAAP)

3.29%



3.31%



3.62%



 

S&T Bancorp, Inc.

Consolidated Selected Financial Data

Unaudited


Definitions and Reconciliation of GAAP to Non-GAAP Financial Measures - continued:



2020







Third







Quarter













PTPP / Average Assets (non-GAAP)







Income before taxes

$20,028







  Plus: Provision for credit losses

17,485







Total

37,513







Total (annualized) (non-GAAP)

$149,237







Average assets

$9,293,004







PTPP / Average Assets (non-GAAP)

1.61%

















Nine Months Ended September 30,





2020


2019









(6) Return on Average Tangible Shareholders' Equity (non-GAAP)







Net (loss) income (annualized)



($4,189)



$101,564



  Plus: amortization of intangibles (annualized)



2,595



680



  Tax effect of amortization of intangibles (annualized)



(545)



(143)



Net (loss)  income before amortization of intangibles (annualized)



($2,140)



$102,101










Average total shareholders' equity



$1,175,384



$956,826



  Less: average goodwill and other intangible assets



(383,000)



(289,786)



  Tax effect of average goodwill and other intangible assets



2,116



491



Average tangible equity (non-GAAP)



$794,500



$667,531



Return on average tangible equity (non-GAAP)



(0.27%)



15.30%










(7) Efficiency Ratio (non-GAAP)







Noninterest expense



$138,115



$116,938



  Less: merger related expenses



(2,342)





Noninterest expense excluding nonrecurring items



$135,773



$116,938










Net interest income per consolidated statements of net income



$209,460



$182,379



  Less: net (gains) losses on sale of securities



(142)





  Plus: taxable equivalent adjustment



2,477



2,854



Net interest income (FTE) (non-GAAP)



$211,795



$185,233



Noninterest income



44,110



37,326



Net interest income (FTE) (non-GAAP) plus noninterest income



$255,905



$222,559



Efficiency ratio (non-GAAP)



53.06%



52.54%










(8) Net Interest Margin Rate (FTE) (non-GAAP)







Interest income



$244,916



$238,028



 Less: interest expense



35,456



(55,649)



Net interest income per consolidated statements of net income



209,460



182,379



 Plus: taxable equivalent adjustment



2,477



2,854



Net interest income (FTE) (non-GAAP)



$211,937



$185,233



Net interest income (FTE) (annualized)



$283,098



$247,656



Average earning assets



$8,389,976



$6,744,127



Net interest margin - (FTE) (non-GAAP)



3.37%



3.67%



 

S&T Bancorp, Inc.

Consolidated Selected Financial Data

Unaudited


The following profitability metrics for the nine  months ended September 30, 2020  are adjusted to exclude a $58.7 million loss related to a customer fraud.



2020



Nine Months

Ended

September 30,





Return on Average Tangible Shareholders' Equity (non-GAAP)



Net loss

($3,136)



  Provision for credit losses

58,671



  Tax effect

(12,321)



Net income excluding fraud

$43,214






Net income excluding fraud (annualized)

$57,724



  Plus: amortization of intangibles (annualized)

2,595



  Tax effect of amortization of intangibles (annualized)

(545)



Net income before amortization of intangibles (annualized)

$59,774






Average total shareholders' equity

$1,175,384



  Less: average goodwill and other intangible assets

(383,000)



  Tax effect of average goodwill and other intangible assets

2,116



Average tangible equity (non-GAAP)

$794,500



Return on average tangible shareholders' equity (non-GAAP)

7.52%






Return on Average Assets (non-GAAP)



Net income excluding fraud (annualized)

$57,724



Average total assets

9,162,380



Return on average assets (non-GAAP)

0.63%






Return on Average Equity (non-GAAP)



Net income excluding fraud (annualized)

$57,724



Average total shareholders' equity

1,175,384



Return on average assets (non-GAAP)

4.91%



 

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SOURCE S&T Bancorp, Inc.

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