Farmers National Banc Corp. · NASDAQ:FMNB
Farmers National Banc — Investor Presentation (May 2019)
28 slides from Farmers National Banc's investor presentation, May 30, 2019
Slide 1: Investor Presentation May 30, 2019
Investor Presentation May 30, 2019 Exhibit 99.1
Slide 2: Disclosure Statements
Disclosure Statements Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements about the financial condition, results of operations, asset quality trends and profitability of Farm
Slide 3: About Farmers National Banc Corp.
About Farmers National Banc Corp. Operating in nine counties in Ohio Founded in 1887 Added a loan production office in Beachwood, OH in December 2017 Entered Holmes County, Ohio with the Monitor Bank merger in August, 2017 Added a loan production office in Beaver, PA in July 2016 Acquired Bowers Ins
Slide 4: Farmers Footprint and Financial Highlights
Farmers Footprint Financial Highlights at March 31, 2019 Farmers locations: 41 Assets: $2.36 billion Loans: $1.74 billion Deposits: $1.95 billion Loan/Deposit Ratio: 89.22% Tangible Common Equity: 9.92% Market Capitalization: $383 million1 Wealth Management Assets Under Care: $2.5 billion Based on F
Slide 5: Mergers/Acquisitions and Organic Growth
Mergers/Acquisitions and Organic Growth *As of March 31, 2019
Slide 6: Economic Update: Strong Economic Characteristics
Economic Update Strong Economic Characteristics According to a Sept. 2017 study from the State of Ohio, in 2016 Ohio was the 7th largest source of GDP among the 50 states and Washington D.C. Ohio was ranked the 10th best state for business in 2018 according to Chief Executive. In 2017, as it did the
Slide 7: Economic Update: Strong Economic Characteristics
Economic Update Strong Economic Characteristics The Youngstown Business Incubator, has a unique focus on tech start-ups, was recently named one of the top 25 incubators in the world. The Youngstown-Warren Region has a regional and national specialization in the following industries: Distribution, Wa
Slide 8: Financial Overview
Financial Overview Stock Data – NASDAQ: FMNB As of 03/31/19 Stock Price: $13.79 ($14.55 as of 5/15/19) Operating Results for 3 Months Ended 03/31/19 Revenue: $31.2 million excluding gains Dividend (yield): $0.09 (2.61%) Cash Dividends: $2.5 million Net Income-Diluted Share: $0.30 ROAE: 12.71% ROAA:
Slide 9: Market Capitalization Growth
Market Capitalization Growth Market Capitalization Growth:69% since December 31, 2016 Added to the U.S. Russell 2000® Index at the conclusion of the Russell U.S. Indexes annual reconstitution on June 27, 2016
Slide 10: Stable Dividend Policy
Stable Dividend Policy Consistently paid a quarterly cash dividend Current yield 2.61% Dividend payout range policy of 25% - 35% 2019 dividend payout: 29.8% of net income Increasing Shareholder Value Stock Up 55% Since ‘16
Slide 11: Commitment to Stakeholders
Commitment to Stakeholders *Source: FDIC Quarterly Banking Profile - Second Quarter 2014 Four Pillars Meaningful Returns Customers Small Business Support 45% of small business lending comes from community banks* Associates 468 associates Top 100 employer in the region Community Over $294,026 in Comm
Slide 12: 2019 Critical Few Focus
2019 Critical Few Focus Deposit Growth All divisions will focus on deepening customer relationships through deposit gathering Wealth Management Integration and Branding Strategy Leverage opportunities in Western Region Execute new Brand Strategy Increase fee income Branch Optimization Evaluate footp
Slide 13: Loan Growth
Loan Growth $1,296,865 $1,577,381
Slide 14: Loan Portfolio Mix
Loan Portfolio Mix – March 31, 2019 Overview of Loan Portfolio Dollars in thousands Diverse loan mix Farmers’ practice is to lend primarily within its market area Less than 3% of loan portfolio is participations purchased Less than 5% of loan portfolio is construction loans
Slide 15: Excellent Asset Quality
Excellent Asset Quality Note: Dollars in thousands 3/31/2019 3/31/2018 Change Non-performing loans $7,578 $7,893 -3.99% Other real estate loans 208 59 252.54% Total non-performing assets $7,786 $7,952 -2.09% Loans 30-89 days delinquent $9,082 $6,973 30.25% Net loan charge-offs $365 $782 -53.32% Tota
Slide 16: Wealth Management Creates Fee-based Income
Wealth Management Creates Fee-based Income Fee Income 2009: 14.5% of total gross income Noninterest income excluding security gains Fee Income 2019*: 20.90% of total gross income Noninterest income excluding security and asset gains Wealth Management Growth Timeline 2000 Farmers National Investments
Slide 17: Noninterest Income
Noninterest Income Continued Focus on Growing Noninterest Income Noninterest Revenue: 20.90% of Total Revenue, excluding gains *For the quarter ending March 31, 2019 excluding gains
Slide 18: Established and Experienced Management Team
Established and experienced management team with over 386 years of combined experience, 181 of which have been with Farmers. Farmers Academy Attracting quality banking talent Robust succession planning process Talent Acquisition and Retention Years of Experience FMNB Industry President & Chief Execu
Slide 19: Capital Management
Cash Dividend Payout Policy Maintain 25% - 35% range Share Repurchase Plan Continue to look for repurchase opportunities Organic Growth Continued organic growth in current markets Growth opportunities in new markets with Private Banking, Trust and Investments Acquisition Opportunities Targeted acqui
Slide 20: Continued Strong Results – Overview of 1Q 2019
Net income is 9% higher than same quarter in 2018 145 consecutive quarters of profitability Annualized return on average assets was 1.45% and annualized return on average equity 12.71% for the quarter ended March 31, 2019 9% loan growth since March 31, 2019 Non-performing assets to total assets rema
Slide 21: Net Interest Income
Net Interest Income Dollars in thousands
Slide 22: Interest Rate Risk Management
Interest Rate Risk Management NII benefits from asset re-pricings in a rising rate environment 57% of total loans are floating/variable rate Investment portfolio duration of approximately 6.8 years Short-term wholesale funding represents approximately 10% of total funding Approximately $2.5 million
Slide 23: Supplemental Information
FARMERS Supplemental Information
Slide 24: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Reconciliation of Common Stockholders' Equity to Tangible Common Equity March 31, Dec. 31, Sept. 30, June 30, March 31, 2019 2018 2018 2018 2018 Stockholders' Equity $272,951 $262,320 $248,789 $247,510 $241,240 Less Goodwill and other intangibles 43,625 43,952 44,305
Slide 25: Consolidated Statements of Income
Consolidated Statements of Income Consolidated Statements of Income For the Three Months Ended March 31, Dec. 31, Sept. 30, June 30, March 31, 2019 2018 2018 2018 2018 Total interest income $24,679 $24,447 $23,563 $22,474 $21,282 Total interest expense 4,714 4,373 3,644 2,912 2,336 Net interest inco
Slide 26: Consolidated Statements of Financial Condition
Consolidated Statements of Financial Condition March 31, Dec. 31, Sept. 30, June 30, March 31, 2019 2018 2018 2018 2018 Assets Cash and cash equivalents $69,672 $57,926 $75,635 $76,623 $52,149 Securities available for sale 403,770 402,190 389,996 388,890 384,396 Equity securities 7,460 7,130 6,892 6
Slide 27: Capital Management
Capital Management Steady Tier 1 Leverage Ratio 9.50% 9.91% 9.92% 12/31/17 12/31/18 3/31/19 = Well Capitalized m Excess
Slide 28: Deposit Market Share by County
Deposit Market Share by County Note: Market share data as of October 10, 2018 Source: SNL Wayne Top 10 2018 Rank Company Branches Dep. ($000) Market Share (%) 1 PNC Bank NA 8 569,425 28.46 2 Farmers National Bank of Canfield 9 368,994 18.44 3 Huntington National Bank 4 288,687 14.43 4 Wayne Savings
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