Amerant Reports Second Quarter 2024 Results

Board of Directors Declares Quarterly Cash Dividend of $0.09 per Common Share

Amerant Bancorp Inc. (NYSE:AMTB) (the "Company" or "Amerant") today reported net income attributable to the Company of $5.0 million in the second quarter of 2024, or $0.15 per diluted share, compared to $10.6 million, or $0.31 per diluted share, in the first quarter of 2024.

"The Company had strong loan growth in the second quarter, as well as significantly higher pre-provision net revenue, excluding the impact of previously disclosed deal charges from the sale of our Houston franchise" stated Jerry Plush, Chairman and CEO. "However, the provision for credit losses was higher than the first quarter, primarily related to a legacy commercial credit that, while paying as agreed, was downgraded based on the receipt of updated financial information. We are actively working toward reaching a positive resolution on this credit, as we remain focused on executing on our strategic plan."

• Total assets were $9.7 billion, a decrease of $70.0 million, or 0.7%, compared to $9.8 billion in 1Q24.

• Cash and cash equivalents were $310.3 million, down $349.4 million, or 53.0%, compared to $659.7 million in 1Q24.

• Total gross loans were $7.32 billion, an increase of $316.5 million, or 4.5%, compared to $7.01 billion in 1Q24, driven by organic production during the quarter.

• Average yield on loans increased to 7.08%, compared to 7.05% in 1Q24.

• Total deposits were $7.82 billion, down $62.2 million, or 0.8%, compared to $7.88 billion in 1Q24, as continued organic growth was offset by a reduction in higher-cost municipal and commercial deposits.

• Core deposits were $5.51 billion, down $127.8 million, or 2.3%, compared to $5.63 billion in 1Q24, driven by the previously referenced reduction in higher-cost municipal and commercial deposits.

• Average cost of total deposits slightly decreased to 2.98%, compared to 3.00% in 1Q24.

• Loan to deposit ratio was 93.69%, compared to 88.93% in 1Q24.

• Total advances from Federal Home Loan Bank ("FHLB") were $765.0 million, up $50.0 million, or 7.0%, compared to $715.0 million in 1Q24. The Bank had $2.1 billion in availability remaining from the FHLB as of June 30, 2024.

• Total non-performing assets were $121.1 million, up $70.6 million, or 139.9%, compared to $50.5 million as of 1Q24. The increase was primarily driven by three credits previously classified as special mention and two newly downgraded loans to substandard based on receipt of updated financial information from borrowers in the second quarter.

• The allowance for credit losses ("ACL") was $94.4 million, a decrease of $1.7 million, or 1.7%, compared to $96.1 million as of 1Q24.

• Assets Under Management and custody ("AUM") totaled $2.45 billion, up $94.2 million, or 4.0%, from $2.36 billion in 1Q24.

• Pre-provision net revenue ("PPNR")⁽¹⁾ was $25.5 million, compared to $25.9 million in 1Q24. PPNR, excluding non-routine items in connection with the sale of the Company's Houston franchise which were disclosed on a Form 8-K on July 1, 2024 (the "Houston Transaction"), was $31.0 million, compared to PPNR of $26.1 million in 1Q24, excluding non-routine items of non-interest income and expense⁽²⁾.

• Net Interest Margin ("NIM"), was 3.56%, up compared to 3.51% in 1Q24

• Net Interest Income ("NII") was $79.4 million, up $1.4 million, or 1.8%, from $78.0 million in 1Q24.

• Provision for credit losses was $19.2 million, up $6.8 million, or 54.4%, compared to $12.4 million in 1Q24.

• Non-interest income was $19.4 million, up $4.9 million, or 34.0%, from $14.5 million in 1Q24.

• Non-interest expense was $73.3 million, up $6.7 million, or 10.1%, from $66.6 million in 1Q24. Non-interest expense, excluding non-routine items in connection with the Houston Transaction⁽²⁾ were $67.7 million.

• The efficiency ratio was 74.2%, compared to 72.0% in 1Q24. The efficiency ratio excluding non-routine items in connection with the Houston Transaction was 68.6%⁽²⁾.

• Return on average assets ("ROA") was 0.21%, compared to 0.44% in 1Q24. ROA excluding non-routine items in connection with the Houston Transaction was 0.38%⁽²⁾.

• Return on average equity ("ROE") was 2.68%, compared to 5.69% in 1Q24. ROE excluding non-routine items in connection with the Houston Transaction was 5.03%⁽²⁾.

• The Company's Board of Directors declared a cash dividend of $0.09 per share of common stock on July 24, 2024. The dividend is payable on August 30, 2024, to shareholders of record on August 15, 2024.

Additional details on second quarter 2024 results can be found in the Exhibits and Glossary of Terms and Definitions to this earnings release, and the earnings presentation available under the Investor Relations section of the Company's website at https://investor.amerantbank.com. See Glossary of Terms and Definitions for definitions of financial terms.

Second Quarter 2024 Earnings Conference Call

The Company will hold an earnings conference call on Thursday, July 25, 2024 at 9:00 a.m. (Eastern Time) to discuss its second quarter 2024 results. The conference call and presentation materials can be accessed via webcast by logging on from the Investor Relations section of the Company's website at https://investor.amerantbank.com. The online replay will remain available for approximately one month following the call through the above link.

About Amerant Bancorp Inc. (NYSE:AMTB)

Amerant Bancorp Inc. is a bank holding company headquartered in Coral Gables, Florida since 1979. The Company operates through its main subsidiary, Amerant Bank, N.A. (the "Bank"), as well as its other subsidiaries: Amerant Investments, Inc., Elant Bank and Trust Ltd., and Amerant Mortgage, LLC. The Company provides individuals and businesses in the U.S. with deposit, credit and wealth management services. The Bank, which has operated for over 40 years, is the largest community bank headquartered in Florida. The Bank operates 25 banking centers – 18 in South Florida, 1 in Tampa, FL and 6 in the Houston, Texas area. For more information, visit investor.amerantbank.com.

Cautionary Notice Regarding Forward-Looking Statements

This press release contains "forward-looking statements" including statements with respect to the Company's objectives, expectations and intentions and other statements that are not historical facts. Examples of forward-looking statements include but are not limited to: our future operating or financial performance, including revenues, expenses, expense savings, income or loss and earnings or loss per share, and other financial items; statements regarding expectations, plans or objectives for future operations, products or services, and our expectations on loan recoveries or reaching positive resolutions on problem loans. All statements other than statements of historical fact are statements that could be forward-looking statements. You can identify these forward-looking statements through our use of words such as "may," "will," "anticipate," "assume," "should," "indicate," "would," "believe," "contemplate," "expect," "estimate," "continue," "plan," "point to," "project," "could," "intend," "target," "goals," "outlooks," "modeled," "dedicated," "create," and other similar words and expressions of the future.

Forward-looking statements, including those relating to our beliefs, plans, objectives, goals, expectations, anticipations, estimates and intentions, involve known and unknown risks, uncertainties and other factors, which may be beyond our control, and which may cause the Company's actual results, performance, achievements, or financial condition to be materially different from future results, performance, achievements, or financial condition expressed or implied by such forward-looking statements. You should not rely on any forward-looking statements as predictions of future events. You should not expect us to update any forward-looking statements, except as required by law. All written or oral forward-looking statements attributable to us are expressly qualified in their entirety by this cautionary notice, together with those risks and uncertainties described in "Risk factors" in our annual report on Form 10-K for the fiscal year ended December 31, 2023 filed on March 7, 2024, in our quarterly report on Form 10-Q for the fiscal quarter ended March 31, 2024 filed on May 3, 2024 and in our other filings with the U.S. Securities and Exchange Commission (the "SEC"), which are available at the SEC's website www.sec.gov.

Interim Financial Information

Unaudited financial information as of and for interim periods, including the three and six month periods ended June 30, 2024 and 2023, and the three months ended March 31, 2024 and December 31, 2023, may not reflect our results of operations for our fiscal year ending, or financial condition, as of December 31, 2024, or any other period of time or date.

Non-GAAP Financial Measures

The Company supplements its financial results that are determined in accordance with accounting principles generally accepted in the United States of America ("GAAP") with non-GAAP financial measures, such as "pre-provision net revenue (PPNR)", "core pre-provision net revenue (Core PPNR)", "core noninterest income", "core noninterest expense", "core net income", "core earnings per share (basic and diluted)", "core return on assets (Core ROA)", "core return on equity (Core ROE)", "core efficiency ratio", "tangible stockholders' equity (book value) per common share", "tangible common equity ratio, adjusted for unrealized losses on debt securities held to maturity", and "tangible stockholders' equity (book value) per common share, adjusted for unrealized losses on debt securities held to maturity". This supplemental information is not required by, or is not presented in accordance with GAAP. The Company refers to these financial measures and ratios as "non-GAAP financial measures" and they should not be considered in isolation or as a substitute for the GAAP measures presented herein.

We use certain non-GAAP financial measures, including those mentioned above, both to explain our results to shareholders and the investment community and in the internal evaluation and management of our businesses. Our management believes that these non-GAAP financial measures and the information they provide are useful to investors since these measures permit investors to view our performance using the same tools that our management uses to evaluate our past performance and prospects for future performance, especially in light of the additional costs we have incurred in connection with the Company's restructuring activities that began in 2018 and continued in 2024, including the effect of non-core banking activities such as the sale of loans and securities and other repossessed assets, the Houston Transaction, the valuation of securities, derivatives, loans held for sale and other real estate owned and repossessed assets, the early repayment of FHLB advances, impairment of investments, Bank owned life insurance restructure and other non-routine actions intended to improve customer service and operating performance. While we believe that these non-GAAP financial measures are useful in evaluating our performance, this information should be considered as supplemental and not as a substitute for or superior to the related financial information prepared in accordance with GAAP. Additionally, these non-GAAP financial measures may differ from similar measures presented by other companies.

Exhibit 2 reconciles these non-GAAP financial measures to GAAP reported results.

Exhibit 1- Selected Financial Information

The following table sets forth selected financial information derived from our interim unaudited and annual audited consolidated financial statements.

Exhibit 2- Non-GAAP Financial Measures Reconciliation

The following table sets forth selected financial information derived from the Company's interim unaudited and annual audited consolidated financial statements, adjusted for certain costs incurred by the Company in the periods presented related to tax deductible restructuring costs, provision for (reversal of) credit losses, provision for income tax expense (benefit), the effect of non-core banking activities such as the sale of loans and securities and other repossessed assets, the Houston Transaction, the valuation of securities, derivatives, loans held for sale and other real estate owned and repossessed assets, the early repayment of FHLB advances, impairment of investments, Bank owned life insurance restructure and other non-routine actions intended to improve customer service and operating performance. The Company believes these adjusted numbers are useful to understand the Company's performance absent these transactions and events.

Exhibit 3 - Average Balance Sheet, Interest and Yield/Rate Analysis

The following tables present average balance sheet information, interest income, interest expense and the corresponding average yields earned and rates paid for the periods presented. The average balances for loans include both performing and nonperforming balances. Interest income on loans includes the effects of discount accretion and the amortization of non-refundable loan origination fees, net of direct loan origination costs, accounted for as yield adjustments. Average balances represent the daily average balances for the periods presented.