Laurentian Bank Of Canada · TSX:LB
Laurentian Bank Of Canada — Investor Presentation (January 2022)
46 slides from Laurentian Bank Of Canada's investor presentation, January 2022
Slide 1: Laurentian Bank Investor Presentation
Laurentian Bank Investor Presentation January 2022 1
Slide 2: Caution regarding forward-looking statements
Caution regarding forward-looking statements From time to time, Laurentian Bank of Canada (the "Bank") w ill make w ritten or oral forw ard-looking statements w ithin the meaning of applicable securities legislation, including such as those contained in this document (and in the documents incorporat
Slide 3: Non-GAAP financial and other measures
Non-GAAP financial and other measures Management uses financial measures based on generally accepted accounting pr inciples (GAA P) and non- GAAP financ ial measures to assess the Bank’s performance. Non-GAA P financial measures presented throughout this document are referred to as “adjusted” measur
Slide 4: Who Is Laurentian Bank?
1.0 Who Is Laurentian Bank? i
Slide 5: Who we are
Who we are Founded in Montreal in 1846, Laurentian Bank helps families, businesses and communities thrive. Today, we have 2,800 employees working together as one team, to provide a broad range of financial services and advice-based solutions for customers across Canada and the United States. 5 5
Slide 6: Who we are | Laurentian Bank by the numbers
Who we are | Laurentian Bank by the numbers* 7 th $45.1B $31.0B largest in balance sheet in assets under Canadian bank assets administration 2,800+ employees 175 years strong, 460,000+ customers founded in 1846 7 6 * As of December 2021 6
Slide 7: Who we are | Our operations
Who we are | Our operations Commercial Banking Personal Banking Capital Markets Our Commercial Bank is the growth Our One Personal Bank delivers an omni- Our Capital Markets division offers our engine of the Bank, offering our customers channel experience for our customers unique, focused and value-
Slide 8: Who we are | Our purpose & core values
Who we are | Our purpose & core values Our purpose Our core values We believe we can change banking for We place our customers first the better. By seeing beyond numbers We work together as One Team to bring hopes and dreams to life. We act courageously Better begins when everyone feels like they be
Slide 9: 2021 A Year in Review
2.0 2 2021 A Year in Review
Slide 10: Executed against three key priorities
A Year in Review | Executed against three key priorities TEAM EFFICIENCY STRATEGY Renewed the Increased cost Conducted a review leadership team and discipline while pivoting of operations and organizational to structural cost developed a new structure optimization strategic plan 10
Slide 11: Our renewed senior leadership team
A Year in Review | Our renewed senior leadership team KARINE ABGRALL-TESLYK SÉBASTIEN BÉLAIR YVES DENOMMÉ YVAN DESCHAMPS EVP, Personal Banking EVP, Chief Human EVP, Operations EVP, Chief Financial Officer Resources Officer RANIA LLEWELLYN President and CEO KELSEY GUNDERSON WILLIAM MASON ÉRIC PROVOST
Slide 12: Key highlights in 2021
A Year in Review | Key highlights in 2021 Q1 Q2 Q3 Q4+ Leadership Team Leadership Team Leadership Team New 3-Year Strategic Plan 3 new external hires and Appointed new Head of Appointed Chief Information Completed bank-wide review & an internal promotion Personal Banking & new CFO Technology Officer
Slide 13: 2021 Financial Highlights
Adjusted Net Adjusted Diluted Adjusted PCL (bps)(3)(4) 2021 Financial Income($MM)(1)(4) EPS(2)(4) Efficiency Ratio(2)(4) Highlights $211.2 $4.57 72.30% 72.3% 4.26 35 $193.2 • As a result of the Bank’s $138.2 $2.93 strategic review, results were impacted by impairment and 68.2% 15 13 restructuring ch
Slide 14: Our New Strategic Plan
Our New Strategic Plan 14 14
Slide 15: A 5-point strategy for future growth
Overview | A 5-point strategy for future growth Build One Make Size Our Think Customer Simplify Make the Better Winning Team Advantage First Choice Work across Leverage our size to Create a culture with a Streamline internal From the businesses boundaries, putting the create a competitive relentless
Slide 16: The Path Forward
Build One Winning Team Make Size Our Advantage Think Customer First Simplify Make the Better Choice The Path Forward | Sound growth strategies and purpose-driven Culture Commercial Banking Capital Markets Personal Banking Our Driving Force Our Growth Engine Focused and Aligned Offering Rep
Slide 17: Culture | Inspire and engage employees
|Build 01 BuildOne OneWinning WinningTeam Team |Make 02 MakeSize SizeOur OurAdvantage Advantage Think 03 | Think Customer Customer First First Simplify 04 | Simplify 05 |Make Makethe theBetter Better Choice Choice Culture | Inspire and engage employees Purpose-Driven Listen & Learn Flexibl
Slide 18: Culture | Instil a performance-oriented culture
|Build 01 BuildOne OneWinning WinningTeam Team |Make 02 MakeSize SizeOur OurAdvantage Advantage Think 03 | Think Customer Customer First First Simplify 04 | Simplify 05 |Make Makethe theBetter Better Choice Choice Culture | Instil a performance-oriented culture Introduced Balanced Scorecar
Slide 19: Culture | Create an inclusive environment
|Build 01 BuildOne OneWinning WinningTeam Team |Make 02 MakeSize SizeOur OurAdvantage Advantage Think 03 | Think Customer Customer First First Simplify 04 | Simplify 05 |Make Makethe theBetter Better Choice Choice Culture | Create an inclusive environment Created Cultural Bootcamp to Estab
Slide 20: Commercial Banking | Highly specialized in four sectors
Build One Winning Team Make Size Our Advantage Think Customer First Simplify Make the Better Choice Commercial Banking | Highly specialized in four sectors Real Estate Commercial SME Equipment Inventory Financing and Syndication Financing Financing 20 20
Slide 21: Commercial Banking | Continue to focus on specialized sectors
Build One Winning Team Make Size Our Advantage Think Customer First Simplify Make the Better Choice Commercial Banking | Continue to focus on specialized sectors Increasing the number of relationship managers and support teams Dedicating resources to growing markets and new focus industrie
Slide 22: Commercial Banking | Diversify geographically and by industry
Build One Winning Team Make Size Our Advantage Think Customer First Simplify Make the Better Choice Commercial Banking | Diversify geographically and by industry Commercial Loan Portfolio Mix1 New Focus (2021 vs 2024) Industries 2021 2024 $14BN >$18BN Technology Small 5% 5% Construction 6%
Slide 23: Commercial Banking | Deepening customer relationships
Build One Winning Team Make Size Our Advantage Think Customer First Simplify Make the Better Choice Commercial Banking | Deepening customer relationships Deposits Personal Bank Capital Markets Digital Cash Merchant loans for Capital Markets services for Management Platform Canadian dealers
Slide 24: Capital Markets | Be an alternative to large banks
Build One Winning Team Make Size Our Advantage Think Customer First Simplify Make the Better Choice Capital Markets | Be an alternative to large banks Unique Market Targeted Presence in Key Position Capabilities Markets Own a unique market position Provide higher level of Uniquely position
Slide 25: Capital Markets | Expanding our capabilities
Build One Winning Team Make Size Our Advantage Think Customer First Simplify Make the Better Choice Capital Markets | Expanding our capabilities Further aligning Capital Markets capabilities with Commercial Banking Building selected industry verticals and augmenting current focus areas Add
Slide 26: Capital Markets | Value-added ESG capabilities
Build One Winning Team Make Size Our Advantage Think Customer First Simplify Make the Better Choice Capital Markets | Value-added ESG capabilities Exited Oil and Gas Support Green and Leveraging ESG Creating a equitable, Research and Social Bond Market expertise to build diverse and inclus
Slide 27: Personal Banking | One performance-oriented Personal Bank
Build One Winning Team Make Size Our Advantage Think Customer First Simplify Make the Better Choice Personal Banking | One performance-oriented Personal Bank New leadership team and operating model to expand our Personal offering on a national basis, by combining its physical branch footpr
Slide 28: Personal Banking | Enhance focus products
Build One Winning Team Make Size Our Advantage Think Customer First Simplify Make the Better Choice Personal Banking | Enhance focus products Mortgages Visa Deposits • Replace E2E platform • Leverage Brim’s Platform as a • New digital capabilities to drive • Increase underwriting capacity
Slide 29: Personal Banking | Digital-first approach
Build One Winning Team Make Size Our Advantage Think Customer First Simplify Make the Better Choice Personal Banking | Digital-first approach Customer-centric Close foundational gaps – Debit Consolidate and Enable Digital Advice agile design tap, Digital Wallet, Enhanced standardize remain
Slide 30: Personal Banking | Building a purpose-driven brand
Build One Winning Team Make Size Our Advantage Think Customer First Simplify Make the Better Choice Personal Banking | Building a purpose-driven brand Centralized the Launch new New Product Launches Lead with purpose Marketing Function purpose into market (Mortgages & Visa) and ESG 2021 20
Slide 31: Measuring success: KPIs
Our New Strategic Plan | Measuring success: KPIs Priorities KPIs Employee Engagement Index Employee Turnover ED&I Targets 1. Inspire & engage employees as One 2021: 27% 2021: 74% Annually: 5% Students from Black Team 2022: 25% 2022: 75% Community Culture 2. Instil a performance-oriented culture 2024
Slide 32: Financial Roadmap
4.0 mlatslaleirsl Roadmap i
Slide 33: Our Financial Roadmap | Key financial drivers
Build One Winning Team Make Size Our Advantage Think Customer First Simplify Make the Better Choice Our Financial Roadmap | Key financial drivers FY2022 Medium-Term Loan Growth Low single digit Mid single digit Deposit Growth Low single digit Mid single digit Loan Portfolio Mix Commercial
Slide 34: Our Financial Roadmap | Financial targets
Build One Winning Team Make Size Our Advantage Think Customer First Simplify Make the Better Choice Our Financial Roadmap | Financial targets 2022 Medium-Term Adjusted diluted EPS growth1 > 5% 7-10% Adjusted ROE1 > 8.5% > 10% Adjusted efficiency ratio1 < 68% < 65% Adjusted operating levera
Slide 35: Our Financial Roadmap | LBC valuation
Build One Winning Team Make Size Our Advantage Think Customer First Simplify Make the Better Choice 1 Our Financial Roadmap | LBC valuation Historical Price2/Earnings Ratio 13.0 12.0 Industry Average 11.0 11.0 10.0 2.2 Gap 9.0 8.0 LBC 8.8 7.0 Double Drivers of Valuation 6.0 ✓ Earnings grow
Slide 36: Why Invest in Laurentian Bank?
Why Invest in Laurentian Bank? 36 36
Slide 37: Why Invest? | Our unique value proposition
Why Invest? | Our unique value proposition Alternative to Big 6 Specialized Human Partnerships Resourceful Offering alternative Shifting our Delivering a more Leveraging our size to Employees who are lending services to leadership vision from ‘human experience’ partner with others to resourceful, cr
Slide 38: Why Invest? | A strong foundation
Why Invest? | A strong foundation Prudent Capital Management Diversified Funding Strategy Strong Record of Credit Quality Path to Improved Efficiency New strategic plan with sound business line growth strategies 38 38
Slide 39: Why Invest? | Prudent capital management
Why Invest? | Prudent capital management Capital Management Fundamentals A healthy capital position 2 Common Equity Tier 1 capital ratio3 (in %) ✓ CET1 operating range >8.5% ✓ Excess capital >$300MM 10.2 9.6 9.0 9.0 ✓ Flexibility to support organic growth and 7.9 strategic acquisitions Shareholder V
Slide 40: Why Invest? | Diversified funding strategy
Why Invest? | Diversified funding strategy Multiple Funding Sources Strengthening Our Funding Well-diversified funding sources to support our growth 7% ✓ S&P and DBRS Morningstar revised their long- $45.1 B $45.1 B 1% 19% term ratings outlooks from “negative” to “stable” Demand & ✓ Issued Limited Re
Slide 41: Why Invest? | Strong record of credit quality
Why Invest? | Strong record of credit quality Good track record of strong credit quality Prudent Approach to Risk Provision for credit losses (PCL in bps)1 Management 78 ✓ Strong underwriting discipline ✓ Highly collateralized asset base Risk-Adjusted Return Mindset ➢ Growth of Commercial Banking wi
Slide 42: Why Invest? | Path to improved efficiency
Why Invest? | Path to improved efficiency Partnerships Hybrid Work Model Process Optimization Leveraging partners to Becoming an agile organization, Optimizing end-to-end access economies of and implementing hybrid work processes to deliver more scale and leading models supporting our value for the
Slide 43: Why Invest? | Our commitment to ESG
Why Invest? | Our commitment to ESG Environment Social Governance ✓ Developed TCFD1 roadmap ✓ ED&I targets in leaders’ ✓ ESG steering committee, with ✓ Participant in green bond scorecards CEO as Executive Sponsor issuances ✓ Mandatory unconscious bias ✓ ESG in all Board committee ✓ Expanded mutual
Slide 44: Why Invest? | New 5-point strategy
Why Invest? | New 5-point strategy Build One Winning Make Size Our Think Customer Make the Better Team Advantage First Simplify Choice Culture Commercial Bank Capital Markets Personal Bank Our Driving Force Our Growth Engine Focused & Aligned Offering Repositioning for Growth Underpinned by a commit
Slide 45: Why Invest? | We believe…
Why Invest? | We believe… We have the Our strategy is We have a tested We can leverage We are a purpose- right team focused, simple and proven our size to driven bank and executable formula for leapfrog the success competition Our strategy will drive shareholder value and profitable growth 45 45
Slide 46: Investor Relations | Contact
Investor Relations | Contact Susan Cohen Head, Investor Relations (514) 970-0564 susan.cohen@lbcfg.ca www.lbcfg.ca/investors-centre 46
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