Business First Bancshares, Inc. · NASDAQ:BFST
Business First Bancshares — Raymond James U.S. Bank Conference 2019
34 slides from Business First Bancshares's conference presentation, Sep 3, 2019
Slide 1: Business First Bancshares, Inc. – Raymond James U.S. Bank Conference
BUSINESS FIRST BANK. Go get it. Business First Bancshares, Inc. Raymond James U.S. Bank Conference September 4, 2019
Slide 2: Legal Disclosure
Legal Disclosure Special Note Concersing Forward-Looking Statements Thisinvestor preseatation contains forward looking tatemcots” within the meaning of Section 278 ofthe Securities Act and Section 21 ofthe Exchange Aet made pursuant to th sate harbor provisions ofthe Private Sacurtics Litigation Ref
Slide 3: Overview of Business First Bancshares, Inc.
Overview of Business First Bancshares, Inc.
Slide 4: Overview of Business First Bancshares, Inc.
Overview of Business First Bancshares, Inc. * Founded in 2006; headquartered in Baton Rouge, LA * Commercial bank focused on small-to-midsize ‘businesses and their owners and employees, Curent pertng Inte Lous mares and bata + Troe sccessflaquston since 2015 ‘mean Gateway tak @OI5) ped dneriy Se P f
Slide 5: Our Operating Philosophy Has Been Consistent Since Day One
Our Operating Philosophy Has Been Consistent Since Day 1 + smal Commercial Focus jo-midsize businesses and their owners and employees Target $1-$10mm commercial lending relationships that are typically too small for the larger financial institutions to vakie but too complex for ‘many community banks
Slide 6: Executive Management Team
Executive Management Team Executive team includes a mix of youth and experience which fosters an energetic and collaborative work environment ‘Geographic diversification amongst executive management team Jude Melville 44 14, 2006 Director, President and Chief Executive Officer |Gregory Robertson 47
Slide 7: Market Presidents
Market Presidents © Business First’s Market Presidents have diversified experience at a mix of large, regional and community banks Market Presidents serve as important conduits between executive management and the local markets Tavestar east Baton Rouge Michaet Nizo ” 6 200 Iberville Bank Will Fargo
Slide 8: Corporate History
Corporate History 201% Completed $25 millon private placement of subordinated notes 2018: Usted on NASDAQ.oA April 9" under BEST 2006: 2008: 2010: Bank opened in Expanded Expandee 2015: 2017: Baton Rouge: Into the Into the ‘Acquired American Expanded ‘expanded into the fayette Houma Gateway Financal
Slide 9: Current Footprint
Current Footprint + Statewide focus on urban markets + Multiple markets provide diversification of both risk and production opportunities East Baton Rouge 2006 |Shreveport 2006 [Northshore 2007 Lafayette 2008 lLake Charles 2009 Houma 2010 New Orleans 2015 |West Baton Rouge 2015 Dallas 2017 IMnden 20
Slide 10: Recent Financial Results — Record FY 2018 & Positive YTD 2019
Recent Financial Results —Record FY 2018 & Positive YTD 2019 FY 2018: Combination of Organic and M&A growth Loan growth of 56.7% 2018 organic loan growth of 12.5% Core deposit growth of 60% in FY 2018 driven by organic growth and the strategic addition ‘of MBL Bank and Richland State Bank PTPP CAGR
Slide 11: Quarterly Financial Trends
Quarterly Financial Trends BUSINESS FIRST
Slide 12: Loan Portfolio
Loan Portfolio * Commercial lending is primary focus, with C&l representing 21.9% and Owner Occupied CRE representing 18.6% Recent acquisitions have provided portfolio diversification «Energy concentration has decreased from 19.8% of total loans in 115 107.1% In Q2'19 + Average funded loan amount of
Slide 13: Detailed Loan Composition
Detailed Loan Composition * Owner Occupied CRE makes up 58% of total CRE lending C&D and Total CRE concentrations of 94.4% and 219.8%, respectively [Briss orton one. core ia Dernvas cramer rumen fas BUSINESS FIRST
Slide 14: Loan Production
Loan Production + Business First loans have grown at 28.6% CAGR from 2014- [Meet Wanere Metre 2018 * Continued Loan Growth, FY 18 net organic loan growth of "°° sane 12.5%. Annualized loan growth of 14.9% YTD 2019. siag9.0 1.2000 + Increased production primarily driven by: ~ New lending team added i
Slide 15: Strong Credit Performance
Strong Credit Performance Credit quality metrics have continued to improve significantly since a 2010 NPLs / Gross Loans FY 2017 NCOs resulted from two previously identified, substandard “°™ energy credits $2.7 million in charge-offs from these two credits 308 1 a Balance f the portfolio had only 0.
Slide 16: Strong Credit Performance
Strong Credit Performance Classified Assets have decreased by 30% from $45.5 milion at Classified Asset Coverage Ratiol £2410 to $29.4 million at Q2'19 Past due loans have remained low even with the acquisition of |“ ‘two banks and stress in the energy sector in recent years won | 28 Beginning in Q4
Slide 17: Energy Lending
Energy Lending Energy loans accounted for approximately 7.1% of portfolio and 48.5% of bank-level capital as of June 30, 2019 ‘Geographic, Ioan type and collateral diversification 9.8% of total energy lending is non-correlated (cash secured, ‘Active monitoring of exposures ‘Quarterly review begun in
Slide 18: Energy Lending — Historical Performance
Energy Lending — Historical Performance Continued stability of Watch List as economic conditions for the energy sector shows incremental improvement Q116 Q415 446 «A417 418 219 Upstream $6305 § 13878 $ 14902 § 17.742 $ 12890 $ 11,508 eam seor2 17,422 «85024 25.400 18,148 7,092 Downstream 13279 14248
Slide 19: Commercial Real Estate — Historical Performance
Commercial Real Estate— Historical Performance 44s a219 [Construction 1-4 Family Reskental 25002 $ 20609 $ 97,505 S$ 60450 [other Const, Development, Vacant Land 8 Lots 7284064742, 405,970 fe6644 {Total Construction s7er2 94405 149,585, 227,02 %60f Tota! Loans 125% 110% 147% 138% S6of Tota Bank Capi
Slide 20: Deposit Mix
Deposit Mix Business First's deposit gathering strategy is focused on its Deposit Mix - June 30, 2019 ‘commercial lending relationships In Q2'26, established a relationship pricing model that 5.0% 05% values deposits and treasury management ~ Incentive plan for lenders tied to deposit growth added i
Slide 21: Yield / Rate Analysis
Yield / Rate Analysis + Balance Sheet is asset sensitive son 9 sr 5998 Fr bes be some] | san] [BP] soo ze Stable core NIM saan | e0% eam — F¥ 2018 and through BFST’s deposit Sa 419% cyele (01 2017-01 2019} aN oar |227%| 2.906] 25%] 4078] gore sam | 3708 ‘Strategic acquisitions of MBL Bank sari, 363
Slide 22: Interest Rate Positioning
Interest Rate Positioning + Interest rate sensitivity as of Q2'19 indicated asset sensitivity in shocked rate scenarios. These estimates include Richland State Bank and assume a static balance sheet. 4.0% 2.6% 20% »~ B 0.0% —— 2.0% 4.0% 6.0% +100 {8% change in Net interest ince (year 1) 1% Change in
Slide 23: Securities Portfolio
Securities Portfolio Securities portfolio was $284.5 million (par Securities Portfolio value) as of June 30, 2019, 200-1000 +400 4200 rico Chango (%) 640 281000 at Gar ‘Weighted average life of portfolio as of June 30 was 3.36 years which indicates less price erage Lie 298 315 ast 4054 volatility wh
Slide 24: Update on Minden Bancorp and Richland State Bancorp Transactions
Update on Minden Bancorp and Richland State Bancorp Transactions + equired Minden Bancorp, ne. (MBL Bank) on January 1, 2018 All cash transaction valueé at $76.0mm $823mm in total assets; 1.72% ROAA in FY 2017 ‘lose transaction in under 3 months “Plog Craae& Co. NY) Cepial One Financial Comp. (VA) H
Slide 25: Growth Strategy Going Forward
Growth Strategy Going Forward Maintain Disciplined Focus on Business Model Identify and Recruit | Expanding Presence in Disciplined Acquisition Talented Bankers Existing Markets M Strategy ~ Talented commercialbankers = Incentive program tied ‘o_~ Focused along the-10/12 and ~ Organic expansion will
Slide 26: Appendix
Appendix
Slide 27: Historical Financial Summary
Historical Financial Summary Tod sna Smore——Sanesoo——«SeoKse—‘Storaon) SL to5mAY Sze SOMES SassMLO {eorex HFS) “usa “inzoe “soem esam —rrame toast eae haemo 42579 Degen Sines Saker ssasee saa tz eazy goles a zozgo2 Toma) ca 70m 7325 mes isa toss) mame wena anata Tmgpicinimen ay! Tngtis nds! om HOMES
Slide 28: Energy Portfolio by Total Past Due — As of June 30, 2019
Energy Portfolio by Total Past Due — As of June 30, 2019 Past Due Energy Loans by Category and Collateral (S Millions) lcarzcory Total's | JUpstream 15 [Midstream 7A Joownstream 58 |Supportservice 870 Non olla Gas JcoLLATERAL Jaccounts Receivable & Inventory 299 |Barges, Crew Boats, Marine Vessels |
Slide 29: Energy Portfolio by Risk Rating — As of June 30, 2019
Energy Portfolio by Risk Rating — As of June 30, 2019 Energy Loans by Risk Rating and Category ($Milions) oousttat Ws ‘wre terow |tenota Fama a Super | Hn lemndreume |= |= ere a] ow oe crane fae a | os ToL eRe rm fa [ee Paes a ee esreencay |e | gy ee aeaaxiad alee cn rb as = BUSINESS FIRST
Slide 30: Energy Portfolio by Risk Rating — As of June 30, 2019
Energy Portfolio by Risk Rating — As of June 30, 2019 Energy Loans by Risk Rating and Collateral isk RATING |casn secured superior Jacceptabie pass. TOTAL PASS RATED| Passiwaten we Jotner Assets Especiay 7 Mentioned substandard 6 Jooustut 1s 118 29 82 ea oral BUSINESS FIRST
Slide 31: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures Tove Netcare, FORA Forte Year Ended Deverber at, EC ero | ari [are | as ‘Core Net incom: Not ream S 4003 $ A006 S$ 5111S 4B S 140m 5 Gos SAGO S545 S300 $e ‘Sao of Prscoaton baoost inpared Croat sos S Gays 6 $ ons s wHs s Deters TexAeset we dour § sos Ss
Slide 32: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures FiscatQuarter Paris [ars [ams [| asi [aris | ‘Tangible Common Equity/ Tangible Assets: Tangible Common Equtty Total Shareholders’ Equity $ 277.489 $ 260,144 $ 260088 $ 212961 $ 210.820 ‘Adjustments: ‘Goodiill (48,502) 49.684) (49,488) (92,427) (82.562) ‘
Slide 33: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures ___“Forthe YearEndedDecembersf, A Tangible Common Equity/ Tangible Assets: Tangbie Common Equiv Total Shareholders’ Eauty S 59524 $ 66260 § 71014 $ 719% $ TABS $ 112440 5 113650 § 179035 § 260,068 ‘Adjustments Good : : - : - (237) @ 624) Baa) 9,488), Cot
Slide 34: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures et acsot ecm S91 $ 972 S O51 $ AH $ THE S EHF HEM S MSOs tEAM $ HOES IEA § WHIM s 1H onary Tan ercase dsc ‘zeta sy ost) oe —aty te, cn ge oy sn Comnitntaestncane “agi Soar Sha a Ce eC ecm ntcot ai fase SLOSS $00L377_ $100 18 $1015 181 SLOT7 ZO SLIOKATS S
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