Byline Bancorp, Inc. (NYSE:BY) Q2 2021 Earnings Conference Call July 30, 2021 10:00 AM ET Company Participants Brooks Rennie - Head of Investor Relations Alberto Paracchini - President Lindsay Corby - Chief Financial Officer Roberto Herencia - Chairman & Chief Executive Officer Conference Call Participants Terry McEvoy - Stephens Nathan Race - Piper Sandler Tim Switzer - KBW Brian Martin - Janney Montgomery Operator Good morning and welcome to the Byline Bancorp Second Quarter 2021 Earnings Conference Call ...

Q2 2021 Conference Call BY Byline Bancorp, Inc. BY LISTED NYSE Forward-Looking Statements This communication contains forward-looking statements within the meaning of the U.S. federal securities laws. Forward-looking statements include, without limitation, statements concerning plans, estimates, calculations, forecasts and projections with respect to the anticipated future performance of the Company. These statements are often, but not always, made through the use of words or phrases such as ''may'', ''migh ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2021 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ______to ______ Commission File Number 001-38139 Byline Bancorp, Inc. (Exact Name of Registrant as Specified in Its Charter) Delaware 36-3012593 (State or Other Jurisdic ...

Byline Bancorp, Inc. (NYSE:BY) Q1 2021 Earnings Conference Call April 30, 2021 10:00 AM ET Company Participants Tony Rossi - Financial Profiles Alberto Paracchini - President Lindsay Corby - Chief Financial Officer Roberto Herencia - Executive Chairman & Chief Executive Officer Conference Call Participants Terry McEvoy - Stephens Ebrahim Poonawala - Bank of America Michael Perito - KBW Nathan Race - Piper Sandler Brian Martin - Janney Montgomery Michael Perito - KBW Operator Good day, and welcome to the Byl ...

Q1 2021 Conference Call BY Byline Bancorp, Inc. BY LISTED NYSE Forward-Looking Statements This communication contains forward-looking statements within the meaning of the U.S. federal securities laws. Forward-looking statements include, without limitation, statements concerning plans, estimates, calculations, forecasts and projections with respect to the anticipated future performance of the Company. These statements are often, but not always, made through the use of words or phrases such as ''may'', ''migh ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☒ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2020 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO Commission File Number 001-38139 Byline Bancorp, Inc. (Exact name of Registrant as specified in its Charter) | --- | --- | --- | |------------------------------ ...

Q4 2020 Conference Call Byline Bancorp, Inc.: BY LISTED NYSE Forward-Looking Statements This communication contains forward-looking statements within the meaning of the U.S. federal securities laws. Forward-looking statements include, without limitation, statements concerning plans, estimates, calculations, forecasts and projections with respect to the anticipated future performance of the Company. These statements are often, but not always, made through the use of words or phrases such as ''may'', ''might' ...

Financial Data and Key Metrics Changes - For Q4 2020, net income was $12.3 million or $0.31 per diluted share, a decline compared to the previous quarter, impacted by branch consolidation charges and asset impairments, reducing net income by approximately $0.15 per diluted share [10] - Adjusted pretax pre-provision revenue was $30.7 million, with an adjusted pretax pre-provision ROA of 191 basis points [10] - Revenue for the quarter was $73.7 million, driven by a 4.7% increase in net interest income and strong non-interest income, although lower than record levels from the previous quarter [11] Business Line Data and Key Metrics Changes - Loans, excluding PPP, increased by $70.4 million or 6.4% from the previous quarter, with originations rising to $230 million from $204 million [12] - Government guaranteed lending had strong production with guaranteed loans sold topping $108 million, generating $9.4 million in gain on sale income [13] - Non-interest bearing deposits increased to 37.1% of total deposits from 35.7% in the prior quarter, reflecting a positive shift in deposit mix [24] Market Data and Key Metrics Changes - Total deposits decreased by $58 million due to seasonal fluctuations, but the mix improved with strong inflows of commercial non-interest bearing deposits [13][23] - The allowance for loan losses represented 153 basis points of total loans, with loans on deferral increasing to $100.6 million, or 2.6% of loans excluding PPP [14] Company Strategy and Development Direction - The company aims to continue profitable growth, drive higher returns, and capitalize on organic and strategic growth opportunities in the market [35] - The strategic plan remains unchanged, focusing on being the best middle-market commercial bank in the Chicago area [40] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism for growth in 2021, particularly in the second half, contingent on vaccine distribution and pandemic management [35][43] - The credit outlook is expected to moderate, with enhanced monitoring of portfolios and proactive support for small business customers [44] Other Important Information - The company doubled its quarterly dividend from $0.03 to $0.06 per share and reinstated its stock buyback program [16] - The company is actively managing expenses, with an expected expense run rate of $41 million to $42 million for the start of 2021 [32] Q&A Session Summary Question: What prompted the CEO change and what should shareholders expect? - The change aligns the roles with the actions taken since 2013, aiming to accelerate execution in a rapidly changing industry [39][40] Question: What is the outlook on credit quality and provisioning? - The credit environment has been more benign than expected due to stimulus measures, with a cautiously optimistic outlook for 2021 [42][43] Question: How does the company plan to increase shareholder value? - The company sees opportunities in both organic growth and M&A, with a focus on maintaining flexibility in capital deployment [50][70] Question: What is the impact of the PPP on the margin? - The impact of PPP on the margin was approximately $5.5 million for the quarter, with additional income expected from the first round of PPP [74] Question: What is the outlook for SBA charge-offs? - Charge-offs are expected to remain low due to government support, with additional flexibility for borrowers to navigate through the pandemic [62][66]

[PART I – FINANCIAL INFORMATION](index=3&type=section&id=PART%20I%20%E2%80%93%20FINANCIAL%20INFORMATION) This section presents Byline Bancorp, Inc.'s unaudited interim condensed consolidated financial statements and notes for the period ended September 30, 2020 [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) This section presents Byline Bancorp, Inc.'s unaudited interim condensed consolidated financial statements and notes for the period ended September 30, 2020 [Condensed Consolidated Statements of Financial Condition](index=3&type=section&id=Condensed%20Consolidated%20Statements%20of%20Financial%20Condition) As of September 30, 2020, total assets grew to **$6.5 billion** from **$5.5 billion** at year-end 2019, primarily driven by a significant increase in net loans and leases to **$4.3 billion**, funded by a rise in total deposits to **$4.8 billion** and increased other borrowings Condensed Consolidated Statements of Financial Condition (in thousands) | Account | September 30, 2020 | December 31, 2019 | Change (%) | | :--- | :--- | :--- | :--- | | **Total Assets** | **$6,496,513** | **$5,521,809** | **+17.7%** | | Net loans and leases | $4,313,259 | $3,753,725 | +14.9% | | Securities available-for-sale | $1,509,211 | $1,186,292 | +27.2% | | Goodwill and other intangible assets, net | $174,523 | $180,255 | -3.2% | | **Total Liabilities** | **$5,701,817** | **$4,771,694** | **+19.5%** | | Total deposits | $4,810,245 | $4,147,577 | +16.0% | | Other borrowings | $710,560 | $539,638 | +31.7% | | **Total Stockholders' Equity** | **$794,696** | **$750,115** | **+5.9%** | [Condensed Consolidated Statements of Operations](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For Q3 2020, net income was **$13.1 million**, down from **$15.3 million** in Q3 2019, primarily due to a significantly higher provision for loan and lease losses, while diluted EPS for Q3 2020 was **$0.34** compared to **$0.39** in Q3 2019 Key Performance Indicators (in thousands, except per share data) | Metric | Three Months Ended Sep 30, 2020 | Three Months Ended Sep 30, 2019 | Nine Months Ended Sep 30, 2020 | Nine Months Ended Sep 30, 2019 | | :--- | :--- | :--- | :--- | :--- | | Net Interest Income | $53,524 | $57,838 | $158,958 | $162,371 | | Provision for Loan and Lease Losses | $15,740 | $5,931 | $45,713 | $16,321 | | Non-interest Income | $22,252 | $14,806 | $44,213 | $40,977 | | Non-interest Expense | $41,705 | $45,448 | $122,244 | $130,081 | | **Net Income** | **$13,071** | **$15,342** | **$25,176** | **$41,150** | | **Diluted EPS** | **$0.34** | **$0.39** | **$0.64** | **$1.07** | [Notes to Condensed Consolidated Financial Statements](index=10&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes provide detailed disclosures on accounting policies, the 2019 acquisition, and breakdowns of financial statement line items, including loan portfolios, allowances, and capital initiatives - On April 30, 2019, the Company acquired Oak Park River Forest Bankshares, Inc. for a total consideration of **$35.5 million**, resulting in **$20.2 million** of goodwill, and adding approximately **$321.2 million** in assets and **$305.9 million** in liabilities[43](index=43&type=chunk)[44](index=44&type=chunk)[48](index=48&type=chunk) - The loan and lease portfolio grew to **$4.4 billion** as of September 30, 2020, up from **$3.8 billion** at year-end 2019, including **$635.4 million** in Paycheck Protection Program (PPP) loans originated in 2020[66](index=66&type=chunk)[232](index=232&type=chunk) - The allowance for loan and lease losses (ALLL) increased significantly to **$61.3 million** at September 30, 2020, from **$31.9 million** at December 31, 2019, with the provision for loan and lease losses for the first nine months of 2020 being **$45.7 million**, a substantial increase from **$16.3 million** in the same period of 2019, reflecting impacts from the COVID-19 pandemic[80](index=80&type=chunk)[85](index=85&type=chunk) - In June and August 2020, the Company issued a total of **$75.0 million** in 6.00% fixed-to-floating subordinated notes, intended to qualify as Tier 2 capital[131](index=131&type=chunk) - The Company's stock repurchase program, authorizing the purchase of up to **1,250,000 shares**, was paused in March 2020, with **118,486 shares** repurchased at a cost of **$1.7 million** in the first quarter of 2020[218](index=218&type=chunk)[219](index=219&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=47&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the company's financial performance and condition, highlighting the impacts of the COVID-19 pandemic, changes in net income and margin, and balance sheet composition [Response to COVID-19 Pandemic](index=48&type=section&id=Response%20to%20COVID-19%20Pandemic) The company actively participated in the Paycheck Protection Program (PPP), originating over **3,700 loans** totaling **$635.4 million** and earning approximately **$22.7 million** in fees, while approving approximately **$631.8 million** in COVID-19 related payment deferrals - Originated over **3,700** Paycheck Protection Program (PPP) loans totaling **$635.4 million**, receiving approximately **$22.7 million** in fee income[232](index=232&type=chunk) - Approved approximately **$631.8 million** in COVID-19 related payment deferrals, representing **16.8%** of the loan portfolio (excluding PPP loans), with active deferrals decreasing to **$27.9 million** (**0.74%** of loans excluding PPP) as of September 30, 2020[233](index=233&type=chunk) [Results of Operations Analysis](index=53&type=section&id=Results%20of%20Operations%20Analysis) Net income for Q3 2020 decreased to **$13.1 million** from **$15.3 million** in Q3 2019, driven by a **$9.8 million** increase in the provision for loan losses, while net interest income fell by **$4.3 million** due to lower asset yields - Net interest margin for Q3 2020 was **3.60%**, a decrease of **102 basis points** from **4.62%** in Q3 2019, primarily due to lower loan yields from decreased market rates and lower-yielding PPP loans[307](index=307&type=chunk) - The provision for loan and lease losses increased by **$9.8 million** in Q3 2020 compared to Q3 2019, reflecting specific impairments and qualitative allocations of **$8.4 million** to address the impact of the COVID-19 pandemic[312](index=312&type=chunk)[284](index=284&type=chunk) - Non-interest income increased by **50.3%** in Q3 2020 year-over-year, driven by a **$3.3 million** increase in net gains on sales of loans and a **$2.7 million** positive swing in loan servicing asset revaluation[313](index=313&type=chunk)[317](index=317&type=chunk)[321](index=321&type=chunk) - Non-interest expense decreased by **8.2%** in Q3 2020 year-over-year, mainly due to lower legal, audit, and professional fees, and reduced data processing expenses following the prior year's system conversion costs[325](index=325&type=chunk)[329](index=329&type=chunk)[331](index=331&type=chunk) [Financial Condition Analysis](index=66&type=section&id=Financial%20Condition%20Analysis) Total assets grew **17.7%** to **$6.5 billion** at September 30, 2020, from year-end 2019, fueled by a **$588.9 million** increase in loans and leases, including PPP originations, while total deposits increased by **$662.7 million** - The loan and lease portfolio increased by **15.6%** to **$4.4 billion** at September 30, 2020, from **$3.8 billion** at December 31, 2019, with originated loans growing by **$800.9 million**, largely due to PPP loans[338](index=338&type=chunk)[352](index=352&type=chunk) - Total deposits grew **16.0%** to **$4.8 billion**, with non-interest-bearing deposits increasing by **34.3%** to **$1.7 billion**, representing **35.7%** of total deposits[380](index=380&type=chunk) - Non-performing assets increased to **$51.3 million**, or **0.79%** of total assets, at September 30, 2020, compared to **$46.2 million**, or **0.84%** of total assets, at December 31, 2019[376](index=376&type=chunk) Regulatory Capital Ratios | Ratio | Company (Sep 30, 2020) | Bank (Sep 30, 2020) | Well-Capitalized Minimum (Bank) | | :--- | :--- | :--- | :--- | | Common Equity Tier 1 (CET1) | 12.55% | 13.25% | 6.50% | | Tier 1 Capital | 13.77% | 13.25% | 8.00% | | Total Capital | 16.67% | 14.50% | 10.00% | | Leverage Ratio | 10.93% | 10.49% | 5.00% | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=91&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company's primary market risk is interest rate risk, managed by the Asset Liability Committee, with an immediate **100 basis point** increase in rates estimated to increase net interest income by **4.7%** over the next twelve months Net Interest Income Sensitivity Analysis (Immediate Shifts) | Change in Market Interest Rates | Estimated Change in NII (Next 12 Months) | | :--- | :--- | | +300 basis points | +16.2% | | +200 basis points | +10.6% | | +100 basis points | +4.7% | | -100 basis points | -2.6% | - The company manages interest rate risk through its Asset Liability Committee, using net interest income simulations and interest rate swaps to hedge exposure, with the notional amount of interest rate swaps being **$373.8 million** as of September 30, 2020[432](index=432&type=chunk) [Item 4. Controls and Procedures](index=93&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of September 30, 2020, with no material changes in internal control over financial reporting during the third quarter - The President and Chief Executive Officer and the Chief Financial Officer concluded that as of September 30, 2020, the Company's disclosure controls and procedures were effective[440](index=440&type=chunk) - No changes in internal control over financial reporting occurred during the quarter ended September 30, 2020, that have materially affected, or are reasonably likely to materially affect, internal controls[441](index=441&type=chunk) [PART II – OTHER INFORMATION](index=94&type=section&id=PART%20II%20%E2%80%93%20OTHER%20INFORMATION) This section provides other information, including legal proceedings, risk factors, and details on unregistered sales of equity securities and use of proceeds [Item 1. Legal Proceedings](index=94&type=section&id=Item%201.%20Legal%20Proceedings) The company is not currently a party to any legal proceedings expected to have a material adverse effect on its business, financial condition, or results of operations - The company is not presently party to any legal proceedings the resolution of which would have a material adverse effect on its business[445](index=445&type=chunk) [Item 1A. Risk Factors](index=94&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2019, or subsequent quarterly reports - No material changes to the risk factors previously disclosed in the Form 10-K for the fiscal year ended December 31, 2019, or subsequent Form 10-Q reports, were reported[446](index=446&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=94&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company's stock repurchase program, approved in November 2019, was paused in March 2020, resulting in no shares repurchased during the third quarter of 2020, with **1,131,514 shares** remaining authorized - The stock repurchase program was paused in March 2020, and no shares were repurchased during the third quarter of 2020[447](index=447&type=chunk)

Financial Data and Key Metrics Changes - Net income for Q3 2020 was $13.1 million or $0.34 per diluted share, up from $9.1 million or $0.24 per diluted share in the previous quarter [9] - Pretax preparation income increased to $34.1 million from $28.4 million quarter-over-quarter, with pretax preparation ROA rising to 212 basis points from 185 basis points [9] - Net interest income rose by nearly $1 million despite a decline in NIM by 11 basis points, attributed to lower yielding PPP loans and increased liquidity [10] Business Line Data and Key Metrics Changes - Total loans and leases remained stable at $4.4 billion, with originated loan portfolio increasing by $41 million, while acquired loan portfolio decreased by $58 million [23] - Government guaranteed lending business saw a record quarter with $176 million in loan commitments, more than double the first half of the year [25] - Non-interest income increased by $9.5 million, primarily due to net gains on sales of government guaranteed loans [32] Market Data and Key Metrics Changes - Total assets grew by approximately $100 million to $6.5 billion, driven by an increase in the securities portfolio [13] - Deposits remained stable, with non-interest bearing deposits representing 35% of total deposits, contributing to a 14 basis points reduction in deposit costs [14] - The overall utilization rate of loans dropped to 57.2% from 58.5% in the previous quarter, indicating a cautious approach from borrowers [24] Company Strategy and Development Direction - The company plans to consolidate 11 branch locations to improve efficiency and invest in digital capabilities [15][18] - Focus remains on supporting existing clients, managing credit quality, and capitalizing on demand while controlling expenses [42] - The company aims to maintain high levels of capital and liquidity to navigate the uncertain economic environment [40] Management's Comments on Operating Environment and Future Outlook - Management expressed caution regarding the economic recovery path due to the pandemic and potential fiscal stimulus impacts [42] - The company remains focused on controllable factors such as expense management and supporting clients [42] - There is optimism about loan demand and pipeline growth, although uncertainty remains regarding the pandemic's impact [62] Other Important Information - The allowance for loan loss increased to 140 basis points of loans from 123 basis points, reflecting ongoing monitoring of credit quality [16] - The company was recognized as the top SBA 7A lender in Illinois and Wisconsin, and second nationally [12] Q&A Session Summary Question: Clarification on margin comment - Management indicated that the reported margin is expected to decline in Q4 but less so than in Q3, with uncertainty around PPP forgiveness impacting predictions [44][45] Question: Expense run rate and guidance for 2021 - Management noted that Q4 expenses could see a modest increase due to branch consolidation costs, with more clarity expected in 90 days [48][49] Question: Confidence in maintaining strong pretax ROA - Management expressed confidence in focusing on controllable factors to maintain strong performance, despite external uncertainties [50][51] Question: Impact of SBA loans and market demand - Management acknowledged strong demand for SBA loans driven by attractive borrower benefits, while underlying demand remains good [56][57] Question: Capital levels and buyback resumption - Management indicated that buybacks would depend on pandemic control and economic stability, with a focus on maintaining flexibility for growth [64][66] Question: Reserve analysis assumptions - Management confirmed that reserve analysis considered the transition of SBA loans off subsidy payments, monitoring borrower payments closely [67][68] Question: Trends in classified and criticized loans - Management reported stability in classified loans, with no significant migration trends observed [71][72] Question: Timing of loans coming off debt relief - Management explained that loans returning to regular payments would be monitored closely, with potential for deferrals if necessary [74][75]