S&T Bancorp, Inc. Announces Fourth Quarter and Full Year 2020 Results

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INDIANA , Pa., Jan. 28, 2021 /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 its fourth quarter and full year 2020 earnings. Net income was $24.2 million , or $0.62 per diluted share, for the fourth quarter compared to net income of $16.7 million , or $0.43 per diluted share, for the third quarter of 2020, and $22.3 million , or $0.62 per diluted share, for the fourth quarter of 2019.

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

Net income was $21.0 million , or $0.53 per diluted share, for the year ended December 31, 2020 compared to net income of $98.2 million , or $2.82 per diluted share, for 2019. A loss of $58.7 million was recognized during the second quarter of 2020 related to a customer fraud resulting from a check kiting scheme. This fraud loss reduced net income by $46.3 million , or $1.19 per diluted share, for the full year 2020.

Fourth Quarter of 2020 Highlights:

Return on average assets (ROA) was 1.05%, return on average equity (ROE) was 8.35% and return on average tangible equity (ROTE) (non-GAAP) was 12.71%.

  • Pre-tax pre-provision to average assets (PTPP) (non-GAAP) was 1.61%.

  • Net interest margin (FTE) (non-GAAP) increased 9 basis points to 3.38% compared to 3.29% for the third quarter of  2020.

  • Portfolio loans decreased $169.0 million compared to September 30, 2020 .

  • Deposits decreased $213.3 million compared to September 30, 2020 .

  • The allowance for credit losses to total portfolio loans was 1.63% at December 31, 2020 compared to 1.64% at September 30, 2020 .

  • S&T's Board of Directors declared a $0.28 per share dividend which is consistent with the same period last year.

Full Year 2020 Highlights:

  • ROA was 0.23%, ROE was 1.80% and ROTE (non-GAAP) was 2.92%. Excluding the loss from the customer fraud ROA (non-GAAP) was 0.74%, ROE (non-GAAP) was 5.76% and ROTE (non-GAAP) was 8.80%.

  • PTPP (non-GAAP) was 1.67%.

  • Portfolio loans increased $88.7 million , or 1.2%, compared to December 31, 2019 .

  • Deposits increased $384.0 million , or 5.5%, compared to December 31, 2019 .

  • Mortgage banking income increased $8.4 million to $10.9 million compared to 2019 due to strong refinance activity.

  • Full year 2020 dividends declared increased 2.8% to $1.12 compared to $1.09 in 2019.

"The year 2020 was challenging for our country, the banking industry and S&T. I continue to be amazed by the resilience of our team of bankers and the communities that we serve during these difficult times," said Todd Brice , chief executive officer of S&T. "As I move on to my next chapter of retirement this coming March, I'm gratified to know that the S&T team will continue to perform at a high level for the benefit of all of our stakeholders."

Fourth Quarter of 2020 Results (three months ended December 31, 2020 )

Net Interest Income

Net interest income increased $0.6 million to $69.9 million compared to $69.3 million in the third quarter of 2020. The increase in net interest income was primarily due to a reduction in deposit costs and the increased contribution of Paycheck Protection Program (PPP) loans to net interest income. Total interest-bearing deposit costs decreased 12 basis points to 0.36% as higher cost Certificates of Deposits and Money Market accounts repriced. The PPP contribution increased by $1.7 million compared to the third quarter of 2020 due to the beginning of loan forgiveness, which led to an increase in loan yield of 2 basis points to 3.89%. Net interest margin on a fully taxable equivalent basis (FTE) (non-GAAP) increased 9 basis points to 3.38% compared to 3.29% in the prior quarter. Excluding PPP, net interest margin (FTE) (non-GAAP) declined 1 basis point to 3.35% compared to 3.36%.

Asset Quality

The provision for credit losses decreased $10.4 million to $7.1 million for the fourth quarter of 2020 compared to $17.5 million in the third quarter of 2020. Net loan charge-offs were $11.2 million for the fourth quarter of 2020 compared to $12.9 million in the third quarter of 2020. Total nonperforming loans increased $62.7 million to $146.8 million , or 2.03% of total loans, at December 31, 2020 compared to $84.1 million , or 1.13% of total loans at September 30, 2020 . The increase in nonperforming loans primarily related to the addition of $56.7 million of hotel loans. The hotel loans have specific reserves of $6.7 million at December 31, 2020 which were based upon updated appraisals received during the fourth quarter of 2020. The allowance for credit losses was 1.63% of total portfolio loans at December 31, 2020 compared to 1.64% at September 30, 2020 . Excluding PPP loans, the allowance for credit losses was 1.74% of total portfolio loans at December 31, 2020 compared to 1.77% at September 30, 2020 .

Noninterest Income and Expense

Noninterest income decreased $0.9 million to $15.6 million in the fourth quarter of 2020 compared to $16.5 million in the third quarter of 2020. The decrease in noninterest income was primarily due to a decline in mortgage banking income due to lower activity compared to the third quarter of 2020. Noninterest expense increased $0.3 million to $48.5 million in the fourth quarter of 2020 compared to $48.2 million in the third quarter of 2020. Other noninterest expense increased $1.8 million mainly related to higher loan workout costs compared to the prior quarter. Salaries and employee benefits decreased $1.8 million due to lower incentives, pension and medical costs compared to the prior quarter.

Financial Condition

Total assets decreased $222.7 million to $9.0 billion at December 31, 2020 compared to $9.2 billion at September 30, 2020 . Portfolio loans decreased $169.0 million compared to September 30, 2020 as loan originations continue to be impacted by the pandemic and $85.0 million of PPP loans were forgiven during the fourth quarter of 2020. Securities increased $55.5 million compared to September 30, 2020 due to cash being redeployed to higher yielding assets. Total deposits decreased $213.3 million mainly due to decreases in interest-bearing demand of $118.4 million , money market of $96.5 million and certificates of deposits of $58.6 million compared to September 30, 2020 .

All capital ratios increased at December 31, 2020 compared to September 30, 2020 and remain above the well-capitalized thresholds of federal bank regulatory agencies.

Full Year 2020 Results (twelve months ended December 31, 2020 )

Full year net income was $21.0 million , or $0.53 per diluted share, for the year ended December 31, 2020 compared to net income of $98.2 million , or $2.82 per diluted share, for 2019. A loss of $58.7 million was recognized during the second quarter of 2020 related to a customer fraud resulting from a check kiting scheme. This fraud loss reduced net income by $46.3 million or $1.19 per diluted share. Full year results were impacted by the DNB Financial Corporation (DNB) merger that occurred on November 30, 2019 with 12 months of impact in 2020 compared to only one month in 2019.

Net interest income increased $32.6 million , or 13.2%, compared to 2019 primarily due to the merger with DNB. Net interest income was impacted by the decrease in interest rates and the effects of the pandemic on loan growth throughout 2020. Net interest margin (FTE) (non-GAAP) decreased 26 basis points to 3.38% compared to 3.64% for 2019. Noninterest income increased $7.2 million compared to the prior year primarily related to higher mortgage banking income of $8.4 million offset by the impact of the pandemic mainly on service charges on deposit accounts. Noninterest expense increased $19.5 million compared to 2019. The DNB merger increased operating expenses which was offset by a reduction of $9.0 million in merger related expenses. FDIC insurance increased $4.3 million due to the DNB merger, the impact of recent financial results on certain components of the assessment calculation and Small Bank Assessment Credits received in 2019. Other expense increased $5.8 million in part due to higher loan collection costs in 2020 compared to 2019. The efficiency ratio (non-GAAP) for 2020, excluding merger related expenses, was 53.86% compared to 51.39% for 2019.

The provision for credit losses increased $116.5 million to $131.4 million for 2020 compared to $14.9 million for 2019. Excluding the customer fraud loss of $58.7 million , the provision was $72.7 million for 2020. The provision for credit losses increased significantly in 2020 due to the pandemic and the adoption of Current Expected Credit Losses (CECL) on January 1, 2020 . Net loan charge-offs were $103.4 million for 2020 compared to $13.6 million for 2019. Excluding the customer fraud, charge-offs were $44.7 million for 2020. Total nonperforming loans increased $92.7 million to $146.8 million , or 2.03% of total loans, at December 31, 2020 compared to $54.1 million , or 0.76% of total loans at December 31, 2019 . The increase in nonperforming loans primarily related to the addition of $56.7 million of hotel loans. The allowance for credit losses was 1.63% of total portfolio loans as of December 31, 2020 compared to 0.87% at December 31, 2019 . Excluding PPP loans, the allowance for credit losses was 1.74% of total portfolio loans at December 31, 2020 . The adoption of CECL increased the allowance for credit losses by $17.5 million on January 1, 2020 .

Dividend

The Board of Directors of S&T declared a $0.28 per share cash dividend at its regular meeting held January 25, 2021 . This is consistent with the common stock dividend declared in the same period in the prior year. The dividend is payable February 25, 2021 to shareholders of record on February 11, 2021 . Dividends declared in 2020 increased $0.03 , or 2.8%, to $1.12 compared to $1.09 for 2019.

Non-GAAP Financial Measures

This release presents certain non-GAAP financial measures. For a reconciliation to the most directly comparable GAAP measures, see "Definitions and Reconciliation of GAAP to Non-GAAP Financial Measures" in the accompanying tables.

Conference Call

S&T will host its fourth quarter 2020 earnings conference call live over the internet at 1:00 p.m. ET on Thursday, January 28, 2021 . To access the webcast, go to S&T's webpage at www.stbancorp.com and click on "Events & Presentations." Select "4th Quarter 2020 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 February 4, 2021 , by dialing 1.877.481.4010; the Conference ID is 39369.

About S&T Bancorp, Inc.

S&T Bancorp, Inc. is a $9.0 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



Fourth


Third


Fourth


(dollars in thousands, except per share data)

Quarter


Quarter


Quarter


INTEREST AND DIVIDEND INCOME







Loans, including fees

$71,148



$72,263



$77,426



Investment securities:







Taxable

3,371



3,473



3,744



Tax-exempt

851



885



836



Dividends

178



227



451



Total Interest and Dividend Income

75,548



76,848



82,457










INTEREST EXPENSE







Deposits

4,795



6,626



15,783



Borrowings and junior subordinated debt securities

824



946



2,262



Total Interest Expense

5,619



7,572



18,045










NET INTEREST INCOME

69,929



69,276



64,412



Provision for credit losses

7,130



17,485



2,105



Net Interest Income After Provision for Credit Losses

62,799



51,791



62,307










NONINTEREST INCOME







 Loss on sale of securities





(26)



 Debit and credit card fees

3,830



4,171



3,454



 Mortgage banking

3,100



3,964



765



 Service charges on deposit accounts

2,984



2,820



3,540



 Wealth management

2,486



2,522



2,412



 Commercial loan swap income

812



499



2,356



 Other

2,397



2,507



2,730



Total Noninterest Income

15,609



16,483



15,231










NONINTEREST EXPENSE







Salaries and employee benefits

22,789



24,571



22,851



Net occupancy

4,068



3,441



3,219



Data processing and information technology

3,835



4,218



4,141



Furniture, equipment and software

2,904



2,440



2,337



Marketing

2,113



1,793



1,116



Other taxes

1,806



1,612



(818)



Professional services and legal

1,503



1,911



862



FDIC insurance

1,372



1,900



222



Merger related expenses





10,179



Other

8,138



6,360



6,069



Total Noninterest Expense

48,528



48,246



50,178










Income Before Taxes

29,880



20,028



27,360



Income Tax Expense

5,703



3,323



5,091










Net Income

$24,177



$16,705



$22,269










Per Share Data:







Shares outstanding at end of period 

39,298,007



39,251,638



39,560,304



Average diluted shares outstanding

39,021,008



39,020,811



35,913,237



Diluted earnings per share

$0.62



$0.43



$0.62



Dividends declared per share

$0.28



$0.28



$0.28



Dividend yield (annualized)

4.51%



6.33%



2.78%



Dividends paid to net income

45.40%



65.61%



42.94%



Book value 

$29.38



$29.10



$30.13



Tangible book value (1)

$19.71



$19.40



$20.52



Market value

$24.84



$17.69



$40.29










Profitability Ratios (annualized) 







Return on average assets 

1.05%



0.72%



1.11%



Return on average shareholders' equity 

8.35%



5.80%



8.30%



Return on average tangible shareholders' equity (2)

12.71%



8.96%



12.04%



Efficiency ratio (FTE) (3)

56.26%



55.75%



49.64%



 

S&T Bancorp, Inc.

Consolidated Selected Financial Data

Unaudited



For the Twelve Months Ended December 31,


(dollars in thousands, except per share data)


2020


2019



INTEREST AND DIVIDEND INCOME







Loans, including fees


$300,960



$300,625




Investment securities:







Taxable


14,918



14,733




Tax-exempt


3,497



3,302




Dividends


1,089



1,824




Total Interest and Dividend Income


320,464



320,484











INTEREST EXPENSE







Deposits


35,986



63,026




Borrowings and junior subordinated debt securities


5,090



10,667




Total Interest Expense


41,076



73,693











NET INTEREST INCOME


279,388



246,791




Provision for credit losses


131,424



14,873




Net Interest Income After Provision for Credit Losses


147,964



231,918











NONINTEREST INCOME







Net gain (loss) on sale of securities


142



(26)




Debit and credit card


15,093



13,405




Service charges on deposit accounts


11,704



13,316




Mortgage banking


10,923



2,491




Wealth management


9,957



8,623




Commercial loan swap income


4,740



5,503




Other


7,160



9,246




Total Noninterest Income


59,719



52,558











NONINTEREST EXPENSE







Salaries and employee benefits


90,115



83,986




Data processing and information technology


15,499



14,468




Net occupancy


14,529



12,103




Furniture, equipment and software


11,050



8,958




Other taxes


6,622



3,364




Professional services and legal


6,394



4,244




Marketing


5,996



4,631




FDIC insurance


5,089



758




Merger related expenses


2,342



11,350




Other


29,008



23,254




Total Noninterest Expense


186,644



167,116











Income Before Taxes


21,039



117,360




Income taxes (benefit) expense


(1)



19,126











Net Income


$21,040



$98,234











Per Share Data:







Average diluted shares outstanding


39,073,219



34,679,478




Diluted earnings per share


$0.53



$2.82




Dividends declared per share


$1.12



$1.09




Dividends paid to net income


200.89%



38.03%











Profitability Ratios







Return on average assets


0.23%



1.32%




Return on average shareholders' equity


1.80%



9.98%




Return on average tangible shareholders' equity (6)


2.92%



14.41%




Efficiency ratio (FTE) (7)


53.86%



51.39%




S&T Bancorp, Inc.

Consolidated Selected Financial Data

Unaudited



2020


2020


2019



Fourth


Third


Fourth


(dollars in thousands)

Quarter


Quarter


Quarter


ASSETS







Cash and due from banks, including interest-bearing deposits

$229,666



$308,489



$169,304



Federal funds sold





28,519



Securities, at fair value

773,693



718,169



784,283



Loans held for sale

18,528



16,724



5,256



Commercial loans:







Commercial real estate

3,244,974



3,290,138



3,416,518



Commercial and industrial

1,954,453



2,042,467



1,720,833



Commercial construction

474,280



477,429



375,445



Total Commercial Loans

5,673,707



5,810,034



5,512,796



Consumer loans:







Residential mortgage

918,398



950,887



998,585



Home equity

535,165



537,869



538,348



Installment and other consumer

80,915



80,735



79,033



Consumer construction

17,675



15,343



8,390



Total Consumer Loans

1,552,153



1,584,834



1,624,356



Total Portfolio Loans

7,225,860



7,394,868



7,137,152



Allowance for credit losses

(117,612)



(120,998)



(62,224)



Total Portfolio Loans, Net

7,108,248



7,273,870



7,074,928



Federal Home Loan Bank and other restricted stock, at cost

13,030



15,777



22,977



Goodwill

373,424



373,417



371,621



Other assets

451,308



484,126



307,762



Total Assets

$8,967,897



$9,190,572



$8,764,649










LIABILITIES







Deposits:







Noninterest-bearing demand

$2,261,994



$2,232,706



$1,698,082



Interest-bearing demand

864,510



982,956



962,331



Money market

1,937,063



2,033,585



1,949,811



Savings

969,508



938,475



830,919



Certificates of deposit

1,387,463



1,446,096



1,595,433



Total Deposits

7,420,538



7,633,818



7,036,576










Borrowings:







Securities sold under repurchase agreements

65,163



42,706



19,888



Short-term borrowings

75,000



83,000



281,319



Long-term borrowings

23,681



49,076



50,868



Junior subordinated debt securities

64,083



64,068



64,277



Total Borrowings

227,927



238,850



416,352



Other liabilities

164,721



175,789



119,723



Total Liabilities

7,813,186



8,048,457



7,572,651










SHAREHOLDERS' EQUITY







Total Shareholders' Equity

1,154,711



1,142,115



1,191,998



Total Liabilities and Shareholders' Equity

$8,967,897



$9,190,572



$8,764,649










Capitalization Ratios







Shareholders' equity / assets

12.88%



12.43%



13.60%



Tangible common equity / tangible assets (4)

9.02%



8.64%



9.68%



Tier 1 leverage ratio

9.43%



9.11%



10.29%



Common equity tier 1 capital

11.33%



11.05%



11.43%



Risk-based capital - tier 1

11.74%



11.46%



11.84%



Risk-based capital - total

13.44%



13.18%



13.22%



S&T Bancorp, Inc.

Consolidated Selected Financial Data

Unaudited



2020


2020


2019



Fourth


Third


Fourth


(dollars in thousands)

Quarter


Quarter


Quarter


Net Interest Margin (FTE) (QTD Averages)







ASSETS







Interest-bearing deposits with banks

$242,778


0.11%

$213,051


0.11%

$82,255


1.44%

Securities, at fair value

726,535


2.43%

759,094


2.41%

696,889


2.61%

Loans held for sale

4,206


2.98%

4,432


3.09%

3,582


3.56%

Commercial Loans:







Commercial real estate

3,269,109


3.77%

3,322,656


4.02%

3,056,513


4.77%

Commercial and industrial

2,012,774


3.95%

2,107,750


3.45%

1,666,061


4.77%

Commercial construction

481,136


3.42%

469,214


3.43%

339,274


4.71%

Total Commercial Loans

5,763,019


3.81%

5,899,620


3.77%

5,061,848


4.77%

Consumer Loans:







Residential mortgage

936,735


4.29%

954,861


4.33%

850,566


4.42%

Home equity

537,201


3.66%

536,735


3.73%

499,520


5.03%

Installment and other consumer

80,849


6.43%

79,649


6.47%

76,029


7.13%

Consumer construction

16,154


4.21%

14,475


4.32%

12,021


4.96%

Total Consumer Loans

1,570,939


4.18%

1,585,720


4.24%

1,438,136


4.78%

Total Portfolio Loans

7,333,958


3.89%

7,485,340


3.87%

6,499,984


4.77%

Total Loans

7,338,164


3.89%

7,489,772


3.87%

6,503,566


4.77%

Federal Home Loan Bank and other restricted stock

14,545


3.97%

15,157


5.11%

21,791


7.44%

Total Interest-earning Assets

8,322,022


3.65%

8,477,074


3.65%

7,304,501


4.53%

Noninterest-earning assets

802,037



815,930



619,586



Total Assets

$9,124,059



$9,293,004



$7,924,087










LIABILITIES AND SHAREHOLDERS' EQUITY







Deposits:







Interest-bearing demand

$904,190


0.11%

$967,735


0.18%

$810,909


0.75%

Money market

2,015,248


0.20%

2,074,862


0.33%

1,791,981


1.53%

Savings

956,438


0.07%

923,208


0.07%

783,990


0.26%

Certificates of deposit

1,423,727


0.93%

1,486,016


1.16%

1,417,619


1.91%

Total Interest-bearing Deposits

5,299,603


0.36%

5,451,821


0.48%

4,804,499


1.30%

Borrowings:







Securities sold under repurchase agreements

50,607


0.25%

64,000


0.25%

14,046


0.75%

Short-term borrowings

75,728


0.22%

84,310


0.38%

241,368


2.08%

Long-term borrowings

40,986


2.43%

49,269


2.52%

56,026


2.63%

Junior subordinated debt securities

64,073


3.11%

64,057


3.19%

54,801


4.33%

Total Borrowings

231,394


1.42%

261,636


1.44%

366,241


2.45%

Total Interest-bearing Liabilities

5,530,997


0.40%

5,713,457


0.53%

5,170,740


1.38%

Noninterest-bearing liabilities

2,441,129



2,433,665



1,689,076



Shareholders' Equity

1,151,933



1,145,882



1,064,271



Total Liabilities and Shareholders' Equity

$9,124,059



$9,293,004



$7,924,087










Net Interest Margin (5)


3.38%


3.29%


3.55%

S&T Bancorp, Inc.

Consolidated Selected Financial Data

Unaudited



For the Twelve Months Ended December 31,

(dollars in thousands)


2020


2019


Net Interest Margin (FTE) (YTD Averages)






ASSETS






Interest-bearing deposits with banks


$179,887


0.29%

$59,941


2.06%

Securities, at fair value


764,311


2.49%

678,069


2.64%

Loans held for sale


5,105


3.13%

2,169


3.88%

Commercial Loans:






Commercial real estate


3,347,234


4.19%

2,945,278


4.92%

Commercial and industrial


2,018,318


3.85%

1,575,485


5.04%

Commercial construction


442,088


3.78%

278,665


5.11%

Total Commercial Loans


5,807,640


4.04%

4,799,428


4.97%

Consumer Loans:






Residential mortgage


964,740


4.25%

765,604


4.43%

Home equity


539,461


3.98%

475,149


5.31%

Installment and other consumer


80,032


6.56%

72,283


7.16%

Consumer construction


13,484


4.40%

10,896


5.44%

Total Consumer Loans


1,597,717


4.28%

1,323,932


4.90%

Total Portfolio Loans


7,405,357


4.09%

6,123,360


4.95%

Total Loans


7,410,462


4.09%

6,125,529


4.95%

Federal Home Loan Bank and other restricted stock


18,234


5.10%

21,833


7.52%

Total Interest-earning Assets


8,372,894


3.87%

6,885,372


4.71%

Noninterest-earning assets


779,853



550,164



Total Assets


$9,152,747



$7,435,536









LIABILITIES AND SHAREHOLDERS' EQUITY






Deposits:






Interest-bearing demand


$961,823


0.28%

$641,403


0.61%

Money market


2,040,116


0.57%

1,691,910


1.79%

Savings


899,717


0.11%

766,142


0.25%

Certificates of deposit


1,517,643


1.36%

1,396,706


1.93%

Total Interest-bearing Deposits


5,419,299


0.66%

4,496,161


1.40%

Borrowings:






Securities sold under repurchase agreements


57,673


0.29%

16,863


0.65%

Short-term borrowings


155,753


0.92%

255,264


2.51%

Long-term borrowings


47,953


2.50%

66,392


2.76%

Junior subordinated debt securities


64,092


3.57%

47,934


4.82%

Total Borrowings


325,471


1.56%

386,453


2.76%

Total Interest-bearing Liabilities


5,744,770


0.72%

4,882,614


1.51%

Noninterest-bearing liabilities


2,238,488



1,569,014



Total Shareholders' Equity


1,169,489



983,908



Total Liabilities and Shareholders' Equity


$9,152,747



$7,435,536









Net Interest Margin (8)



3.38%


3.64%

S&T Bancorp, Inc.

Consolidated Selected Financial Data

Unaudited



2020


2020


2019



Fourth


Third


Fourth


(dollars in thousands)

Quarter


Quarter


Quarter


Nonperforming Loans (NPL)







Commercial loans:


% Loans


% Loans


% Loans

Commercial real estate

$105,014

3.24%

$52,805

1.60%

$29,140

0.85%

Commercial and industrial

23,337

1.19%

12,498

0.61%

13,982

0.81%

Commercial construction

384

0.08%

1,504

0.31%

737

0.20%

Total Nonperforming Commercial Loans

128,735

2.27%

66,807

1.15%

43,859

0.80%

Consumer loans:







Residential mortgage

13,008

1.42%

13,018

1.37%

7,519

0.75%

Home equity

4,935

0.92%

4,106

0.76%

2,639

0.49%

Installment and other consumer

96

0.12%

141

0.17%

40

0.05%

Total Nonperforming Consumer Loans

18,039

1.15%

17,265

1.08%

10,198

0.63%

Total Nonperforming Loans

$146,774

2.03%

$84,072

1.13%

$54,057

0.76%



(dollars in thousands)








Loan Charge-offs/(Recoveries)








Charge-offs

$12,951


$13,667


$2,798



Recoveries

(1,713)


(754)


(802)



Net Loan Charge-offs/(Recoveries)

$11,238


$12,913


$1,996











Net Loan Charge-offs (Recoveries)








Commercial Loans:








Commercial real estate

$10,185


$10,963


$829



Commercial and industrial

412


1,267


(121)



Commercial construction

293


(1)


404



Total Commercial Loan Charge-offs/(Recoveries)

10,890


12,229


1,112



Consumer loans:








Residential mortgage

68


274


112



Home equity

132


204


383



Installment and other consumer

148


206


389



Total Consumer Loan Charge-offs

348


684


884



Total Net Loan Charge-offs/(Recoveries)

$11,238


$12,913


$1,996





For the Twelve Months Ended December 31,

(dollars in thousands)



2020


2019


Loan Charge-offs/(Recoveries)







Charge-offs



$106,365



$16,189



Recoveries



(2,986)



(2,544)



Net Loan Charge-offs/(Recoveries)



$103,379



$13,645










Net Loan Charge-offs (Recoveries)







Commercial loans:







Customer fraud



$58,671



$0



Commercial real estate



27,164



3,527



Commercial and industrial



15,004



7,540



Commercial construction



271



401



Total Commercial Loan Charge-offs/(Recoveries)



101,110



11,468



Consumer loans:







Residential mortgage



435



364



Home equity



433



434



Installment and other consumer



1,401



1,461



Consumer construction





(82)



Total Consumer Loan Charge-offs/(Recoveries)



2,269



2,177



Total Net Loan Charge-offs/(Recoveries)



$103,379



$13,645



S&T Bancorp, Inc.

Consolidated Selected Financial Data

Unaudited



2020


2020


2019



Fourth


Third


Fourth


(dollars in thousands)

Quarter


Quarter


Quarter


Asset Quality Data







Nonperforming loans

$146,774



$84,072



$54,057



OREO

2,155



2,317



3,525



Nonperforming assets

148,929



86,389



57,582



Troubled debt restructurings (nonaccruing)

29,289



18,648



8,912



Troubled debt restructurings (accruing)

17,460



18,478



36,960



Total troubled debt restructurings

46,749



37,126



45,872



Nonperforming loans / total loans

2.03%



1.13%



0.76%



Nonperforming assets / total loans plus OREO

2.06%



1.17%



0.81%



Allowance for credit losses / total portfolio loans

1.63%



1.64%



0.87%



Allowance for credit losses / nonperforming loans

80%



144%



115%



Net loan charge-offs

$11,238



$12,913



$1,996



Net loan charge-offs (annualized) / average loans

0.61%



0.69%



0.12%



















For the Twelve Months Ended December 31,

(dollars in thousands)



2020


2019


Asset Quality Data







Net loan charge-offs



$103,379



$13,645



Net loan charge-offs / average loans



1.40%



0.22%



S&T Bancorp, Inc.

Consolidated Selected Financial Data

Unaudited


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



2020


2020


2019



Fourth


Third


Fourth



Quarter


Quarter


Quarter









(1) Tangible Book Value (non-GAAP)







Total shareholders' equity

$1,154,711



$1,142,115



$1,191,998



Less: goodwill and other intangible assets, net of deferred tax liability

(380,278)



(380,735)



(380,247)



Tangible common equity (non-GAAP)

$774,434



$761,380



$811,751



Common shares outstanding

39,298



39,252



39,560



Tangible book value (non-GAAP)

$19.71



$19.40



$20.52










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







Net income (annualized)

$96,181



$66,455



$88,350



Plus: amortization of intangibles (annualized), net of tax

1,853



2,069



1,025



Net income before amortization of intangibles (annualized)

$98,034



$68,524



$89,375










Average total shareholders' equity

$1,151,933



$1,145,882



$1,064,271



Less: average goodwill and other intangible assets, net of deferred tax liability

(380,734)



(380,781)



(322,204)



Average tangible equity (non-GAAP)

$771,199



$765,101



$742,067



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

12.71%



8.96%



12.04%










(3) Efficiency Ratio (non-GAAP)







Noninterest expense

$48,528



$48,246



$50,178



Less: merger related expenses





(10,179)



Noninterest expense excluding nonrecurring items

$48,528



$48,246



$39,999










Net interest income per consolidated statements of net income

$69,929



$69,276



$64,412



Plus: taxable equivalent adjustment

725



780



903



Net interest income (FTE) (non-GAAP)

70,654



70,056



65,315



Noninterest income

15,609



16,483



15,231



Less: net losses on sale of securities





26



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

$86,263



$86,539



$80,572



Efficiency ratio (non-GAAP)

56.26%



55.75%



49.64%










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







Total shareholders' equity

$1,154,711



$1,142,115



$1,191,998



Less: goodwill and other intangible assets, net of deferred tax liability

(380,278)



(380,735)



(380,247)



Tangible common equity (non-GAAP)

$774,434



$761,380



$811,751










Total assets

$8,967,896



$9,190,572



$8,764,649



Less: goodwill and other intangible assets, net of deferred tax liability

(380,278)



(380,735)



(380,247)



Tangible assets (non-GAAP)

$8,587,618



$8,809,837



$8,384,402



Tangible common equity to tangible assets (non-GAAP)

9.02%



8.64%



9.68%










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







Interest income

$75,548



$76,848



$82,457



Less: interest expense

(5,619)



(7,572)



(18,045)



Net interest income per consolidated statements of net income

69,929



69,276



64,412



Plus: taxable equivalent adjustment

725



780



903



Net interest income (FTE) (non-GAAP)

$70,654



$70,056



$65,315



Net interest income (FTE) (annualized)

$281,080



$278,701



$259,130



Average earning assets

$8,322,022



$8,477,074



$7,304,501



Net interest margin (FTE) (non-GAAP)

3.38%



3.29%



3.55%



S&T Bancorp, Inc.

Consolidated Selected Financial Data

Unaudited


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









2020


2020


2019



Fourth


Third


Fourth



Quarter


Quarter


Quarter









PTPP / Average Assets (non-GAAP)







Income before taxes

$29,880



$20,028



$27,360



Plus: Provision for credit losses

7,130



17,485



2,238



Total

37,010



37,513



29,598



Total (annualized) (non-GAAP)

$147,235



$149,237



$117,427



Average assets

$9,124,059



$9,293,004



$7,924,087



PTPP / Average Assets (non-GAAP)

1.61%



1.61%



1.48%












For the Twelve Months Ended December 31,




2020


2019









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







Net income



$21,040



$98,234



Plus: amortization of intangibles, net of tax



2,001



660



Net income before amortization of intangibles



$23,041



$98,894










Average total shareholders' equity



$1,169,489



$983,908



Less: average goodwill and other intangible assets, net of deferred tax liability



(380,846)



(297,589)



Average tangible equity (non-GAAP)



$788,643



$686,319



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



2.92%



14.41%










(7) Efficiency Ratio (non-GAAP)







Noninterest expense



$186,643



$167,116



Less: merger related expenses



(2,342)



(11,350)



Noninterest expense excluding nonrecurring items



$184,301



$155,766










Net interest income per consolidated statements of net income



$279,388



$246,791



Plus: taxable equivalent adjustment



3,202



3,757



Net interest income (FTE) (non-GAAP)



282,590



250,548



Noninterest income



59,719



52,558



Less: net (gains)losses on sale of securities



(142)



26



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



$342,167



$303,132



Efficiency ratio (non-GAAP)



53.86%



51.39%










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







Interest income



$320,464



$320,484



Less: interest expense



(41,076)



(73,693)



Net interest income per consolidated statements of net income



279,388



246,791



Plus: taxable equivalent adjustment



3,202



3,757



Net interest income (FTE) (non-GAAP)



$282,590



$250,548



Average earning assets



$8,372,894



$6,885,372



Net interest margin (FTE) (non-GAAP)



3.38%



3.64%










PTPP / Average Assets (non-GAAP)







Income before taxes



$21,039



$117,360



Plus: Provision for credit losses



131,424



14,873



Total



152,463



132,233



Total (non-GAAP)



$152,463



$132,233



Average assets



$9,152,747



$7,435,536



PTPP / Average Assets (non-GAAP)



1.67%



1.78%



S&T Bancorp, Inc.

Consolidated Selected Financial Data

Unaudited


The following profitability metrics for the twelve months ended December 31, 2020 are adjusted to exclude a $58.7 million loss related to a customer fraud.




2020




Twelve Months Ended




December 31,






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




Net Income


$21,040



Provision for credit losses


58,671



Tax effect


(12,321)



Net income excluding fraud


$67,390







Net income excluding fraud


$67,390



Plus: amortization of intangibles , net of tax


2,001



Net income before amortization of intangibles


$69,391







Average total shareholders' equity


$1,169,489



Less: average goodwill and intangible assets, net of deferred tax liability


(380,846)



Average tangible equity (non-GAAP)


$788,643



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


8.80%







Return on Average Assets (non-GAAP)




Net income excluding fraud


$67,390



Average total assets


9,152,747