COVID-19 Response, Potential Impact, & Modifications June 11, - - PowerPoint PPT Presentation

June 11, 2020

COVID-19

Response, Potential Impact, & Modifications

COVID-19 Preparedness and Response

Employee Safety Business Continuity Customer Support Implemented physical distancing, safety and hygiene protocols for colleagues not working remotely. PPE for all retail and customer- facing employees. Enhanced sanitation for all locations. Full-compensation for employees, including Emergency Paid Sick Leave Policy enacted. Company began preparations to comply with a “stay at home” order in early March and commenced “stay at home” operations on March 13, 2020. At present, approximately 75% of non-retails employees are working via Virtual Private Network (VPN) and Microsoft TEAMS technology. Bank retail locations are open and

• perating by appointment only or

by utilizing branch drive through. Rapid and successful implementation of the Payroll Protection Program authorized by the CARES act – submitted first application on 4/3/20 and closed/funded first loan on 4/14/20. Proactively contacted customers to listen to and address their short term cash flow requirements. Swiftly provided modifications to loan terms, waived fees and increased limits where appropriate to offer ease in conducting transactions electronically.

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Loans Outstanding 3/31/2020 – Segments by Sector

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Industrial/Manufacturing /Warehouse Office Other Commercial RE Retail Mixed Use Mobile Home/Park Residential 1-4 Non-OO Hotel/Motel/Inn Self-Storage Facility Restaurant/Fast Food Gas Stations

* Excludes Multi-family – $41.3

Professional services Retail (13) Industrial/manufacturin g Utilities Amusements & Rec Advertising agencies Restaurant/fast food Real estate services Broadcasting Other

CRE - Overall C&I - Overall

Sector Balance (in thousands) Percentage Industrial/Manufacturing/Warehouse $64,922 17% Office 47,673 13% Other Commercial RE 46,591 12% Retail 35,039 9% Mixed Use 31,813 8% Mobile Home/Park 30,189 8% Residential 1-4 Non-OO 29,924 8% Hotel/Motel/Inn 28,182 8% Self-Storage Facility 25,646 7% Restaurant/Fast Food 17,372 5% Gas Stations 17,129 5% $374,480 Sector Balance (in thousands) Percentage Professional Services $139,477 28% Non-essential Retail 91,141 18% Industrial/Manufacturing 84,816 17% Utilities 30,284 6% Amusements & Recreation 13,386 3% Advertising Agencies 26,869 5% Restaurant/Fast Food 11,382 2% Real Estate Services 9,190 2% Broadcasting 9,576 2% Other 90,103 18% $506,224

CRE Sectors – Loan to Value – (LTV)

Based on Exposure

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*Gas stations that have greater than 80% LTV are due to SBA 504 amounts not yet funded

54% 38% 37% 67% 50% 12% 25% 21% 13% 25% 27% 38% 42% 17% 25% 8% 4% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% GAS STATIONS AMUSEMENTS & REC HOTEL/MOTEL/INN RESTAURANT/FAST FOOD NON-ESSENTIAL RETAIL 0-50 50-70 70-80 80+

C&I – Potential Impact by Sector

Highlight of outstanding commercial loans as of Q1 2020 within sectors that may be impacted by COVID- 19

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Professional Services, 18% Wholesale, 18% Repairs and Maintenance, 13% Insurance, 9% Home and Garden, 9% Furniture, 7% Beauty / Laundry, 7% Sporting Goods & Hobbies, 6% Transit Services, 3% Commercial Print, 3% Beverage, 2% Automotive, 2% Gas Station, 1%

Non-essential Retail

Sector Balance (in thousands) Percentage Professional Services $16,806 18% Wholesale 16,785 18% Repairs & Maintenance 11,753 13% Insurance 8,597 9% Home & Garden 8,497 9% Furniture 6,741 7% Personal Services 6,274 7% Sporting Goods & Hobbies 5,480 6% Transit Services 3,094 3% Commercial Print 2,938 3% Beverage 1,635 2% Automotive 1,431 2% Gas Stations 1,110 1% $91,141

Average Loan Size $369,000

C&I – Potential Impact by Sector

Highlight of outstanding commercial loans as of Q1 2020 within sectors that may be impacted by COVID- 19

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Amusements & Recreation

Fitness Centers, 93% Golf Courses, 4%, Other (Amusements, Bowling), 3% Full-Service Restaurants, 89% Limited-Service Restaurants, 7% Mobile Food Services, 3% Other (Snacks, Catering, Bars), 1%

Restaurants/Fast Food

Total C&I – 2% Average Loan Size – $137,000 Total C&I – 3% Average Loan Size – $362,000

C&I Warehouse Lending

As of 3/31/2020

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Conventional, 47% Government, 36% Construction to Perm, 5% Non-Qualified Mortgage, 8% Fixed Rate Second Mortgage, 4%

Warehouse Lending Balance (in thousands) Percentage Product Conventional $58,167 47% Government 45,057 36% Construction to Perm (CTP) 6,737 5% Non-Qualified Mortgage (NQM) 9,294 8% Fixed Rate Second Mortgage 4,489 4% $123,744

In late March, non-qualified and construction mortgages were temporarily ceased. As of 6/9/20: CTP: $5.9MM down from $6.8MM on 3/31/20 NQM: $3.0MM down from $9.3MM on 3/31/20

COVID Modification Detail ($ in thousands)

as of 5/22/2020

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All Other CRE, $278,406 COVID Mods, $137,386 All Other C&I, $400,791 COVID Mods, $105,433

$ 94,590

$ 41,827

$ 42,796 $ 63,606

• 10,000

20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000 100,000 CRE C&I Payment Deferred Interest Only

$ Outstanding # of Loans % of Modified $ Outstanding # of Loans % of Modified CRE 94,590 $ 72 30% 42,796 $ 43 18% C&I 41,827 70 29% 63,606 54 23% Total 136,417 $ 142 59% 106,402 $ 97 41% Interest Only Payment Deferred

3/31 Outstanding $ Modified # of Loans % of Total $ CRE 415,792 $ 137,386 $ 115 33% C&I 506,224 105,433 124 21% Total 922,016 $ 242,819 $ 239 26% Overall Modifications

COVID Modification Detail ($in thousands)

as of 5/22/2020

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3-month, 22% 6-month, 78%

$ 38,044 $ 98,372 $ 15,592 $ 90,810

• 20,000

40,000 60,000 80,000 100,000 120,000 140,000 160,000 180,000 200,000 3 MONTH 6 MONTH Payment Deferred Interest Only

Total $ Total % Total $ Total % Total $ Total % Total $ Total % Total $ Total % Total $ Total % CRE 33,978 $ 89% 60,611 $ 62% CRE 15,556 $ 99% 27,240 $ 30% CRE 49,534 $ 92% 87,851 $ 46% C&I 4,066 11% 37,761 38% C&I 36 1% 63,570 70% C&I 4,102 8% 101,331 54% Total 38,044 $ 98,372 $ Total 15,592 $ 90,810 $ Total 53,636 $ 189,182 $ 3-month 6-month Total 3-month 6-month Interest Only Payment Deferred 3-month 6-month

Payroll Protection Program (PPP)

as of 5/21/20

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PPP (as of 5/21/2020) Total

($ in thousands) SBA Approved, # 257 SBA Approved, $ 74,853 Avg Loan Size, $ 291 Fees, $ 2,705 Fees, % 3.61%

Liquidity Monitoring

(as of 3/31/20)

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PPP Funding and modifications will impact liquidity The Bank has adequate sources of liquidity as highlighted below:

Outstanding Additional Borrowing Capacity Federal Home Loan Bank of Boston 25,025 $ 172,322 $ Federal Reserve Bank of Boston 100,000 143,229 Unpledged Securities

• 10,674

Lines of Credit

• 35,000

Brokered Deposits 104,441

• 229,466

$ 361,225 $

(Dollars in thousands)

www.TheProvidentBank.com