Silicon Valley Bank Results Presentation Deck
Exceptional balance sheet growth drove better-than-forecast NII despite low rates
Expect FY'21 NII % growth in the mid 30s¹ and FY'21 NIM between 2.10-2.20%
Q1'21 activity
NET INTEREST INCOME¹
$ Millions
596.5
2.40%
35.4
Q4'20
NIM
Q4'20 Loan Growth Fixed Income Lower Fixed Other
NII
& Mix Shift
NET INTEREST MARGIN
svb >
57.2
0.03%
Loan
Growth &
Mix Shift
Portfolio
Growth
(10.8)
(0.03%)
Income
Yields
(2.9)
(0.04%)
Fixed Income Growth in
Portfolio Cash
Growth Balances
(10.3)
(0.04%)
Day Count
(Two less
business.
days)
Surge in deposits drove significant
securities purchases and high cash
balances, pressuring NIM
(0.03%)
665.1
Lower Fixed Other
Income
Yields
Q1'21
NII
2.29%
Q1'21
NIM
●
NII and NIM expected to be impacted by:
+-
+-
FY'21 outlook key drivers
+
Balance sheet growth
(positive for NII, negative for NIM)
Driven by strong client liquidity
Rate protections
(positive for loan yields, negative for securities yields)
-5 bps of NIM protection in 2021 from locked-in swap gains²
$25.4B active loan floors as of 3/31/21³, however loan renewals may
pressure ability to maintain floor rates
Targeting <2y AFS portfolio duration (hedgeadjusted)
Added $10B receive floating swaps in Q1 at 35 bps cost (as of 3/31/21)
- expect to execute additional swaps to reach AFS duration target
SBA PPP program
FY'21 includes -$35-40M of estimated SBA PPP loan interest and
fees, net of deferred loan origination costs (+1 bp impact to NIM)
Reduction in average Fed cash balances
+
To $8-10B target by end of 2021 (actual balances depend on
timing of fund flows)
Low (but improved) new purchase yields
Expect new purchase yields ~1.35-1.45%
Estimated $3.0-$3.5B paydowns per quarter through 2021
Shifting loan mix
Towards lower yielding Global Fund Banking capital call lines
Spread compression
Increasing competition as economy recovers
1. NII is presented on a fully taxable equivalent basis, while NII guidance excludes fully taxable equivalent adjustments. SBA PP
contributed $14.1M to Q1'21 NII, including $10.1M of loan fees.
2. Unwound $5B swaps in Q1'20 resulting in $227M pretax fair value gains in OCI to be reclassified to loan interest income over5
years based on the timing of cash flows from hedged variablerate loans. $163M locked-in gains remain as of March 31, 2021.
3. $216M mark-to-market value. 3.49% weighted average floor rate, 1.6year weighted average duration.
4. Based on SBA PPP forgiveness expectations. Estimate only, subject to SBA PPP terms; amounts actually forgiven and timing of
forgiveness may differ.
Q1 2021 Financial Highlights
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