Connectone Bancorp, Inc. · NASDAQ:CNOB
Connectone Bancorp — Investor Presentation (February 2024)
31 slides from Connectone Bancorp's investor presentation, Feb 14, 2024
Slide 1: CNOB Investor Presentation
CNOB Investor Presentation February 2024
Slide 2: About ConnectOne Bancorp, Inc.
About ConnectOne Bancorp, Inc. ConnectOne Bancorp, Inc. is a modern financial services company with $9.9 billion in assets. It operates through its bank subsidiary, ConnectOne Bank, and its fintech subsidiary, BoeFly. ConnectOne Bank is a high-performing commercial bank offering a full suite of prod
Slide 3: Organic Growth
Organic Growth Opportunities to expand as a result of post-pandemic trends Densely populated, lucrative markets Strong demand for personalized service among small to mid-sized business owners Our target market is largely dominated by the largest institutions in the country, leaving tremendous opport
Slide 4: Dynamic Expansion
Dynamic Expansion Leveraging technology to drive new opportunities Roots in NY/NJ metro area allow the bank to expand with clients as they build out-of-state outposts Digital investments coupled with ability to attract top talent allows for dynamic expansion Banking Hub model allows ConnectOne to ex
Slide 5: Operating Performance
Operating Performance LTM and 2023 Q4 Financial Highlights 1.32% 9.3% 0.93% 9.4% LTM PPNR1 LTM Return on Tangible Common LTM Core Return as a % of average Tangible Common Equity Ratio on Assets assets Equity 2.83% 1.45% 0.43% 6.6% LTM Net Interest Operating NIE to Non-performing YoY Margin Average A
Slide 6: Core Net Interest Margin
Core Net Interest Margin Yields and Costs 5.63% 5.81% 5.35% 5.49% 5.08% 4.68% 4.80% 4.59% 4.80% 5.44% 5.61% 5.17% 5.31% 4.87% 3.18% 4.49% 4.47% 4.55% 2.92% 4.20% 2.72% 2.36% 1.62% 1.29% 1.08% 0.94% 0.58% 2018Y 2019Y 2020Y 2021Y 2022Y 1Q 23 2Q 23 3Q 23 4Q 23 Loans Interest-earning Assets Cost of Fund
Slide 7: Robust Profitability and Capital Generation
Robust Profitability and Capital Generation Return on Average Assets Tangible Book Value per Share Growth 1.69% 12.0% $25.00 $23.14 1.43% $21.71 7.0% $20.12 $20.00 1.22% 1.17% $17.49 AOCI % Total Equity 0.96% 1.03% $16.06 2.0% $ Per Share 1.17% $15.00 $14.42 1.19% 1.07% 1.12% 0.89% 0.88% 0.96% 0.80%
Slide 8: Non-Interest Income
Non-Interest Income Diversification of Revenue SBA Gain on Sale • Commercial • Residential • Strong fee income momentum • Interchange fees BoeFly • Growing • Overdraft fees opportunities to • Maintenance fees expand product set Minimal dependency on income streams subject to regulatory pressures 8
Slide 9: Diversified and Granular Loan Portfolio
Diversified and Granular Loan Portfolio ($ in millions) Select Loan Portfolio Details as of December 31, 2023 % of Segment $MM Total Underwriting Standards Project feasibility Developers background and expertise Strict loan to cost advances Rental fallback Construction $621 7% Plan and c
Slide 10: Loan Portfolio Detail
Loan Portfolio Detail Type Balance Percentage Type Balance Percentage ($ in millions) CRE - Other / Mi s c $ 690 8% OOC - Other $ 253 3% CRE - Reta i l 637 8% OOC - Wa rehouse / Indus tri a l 250 3% CRE - Offi ce 424 5% OOC - Retai l 210 2% Residential/ CRE - Wa rehous e / OOC - Offi ce / Wa rehous
Slide 11: High Quality Asset Composition and Reserves
High Quality Asset Composition and Reserves Loan Loss Reserves / Loans Receivable Nonperforming Assets / Total Assets 1.27% 0.95% 1.15% 1.12% 0.80% 0.82% 0.98% 0.76% 0.77% 0.75% 0.53% 0.46% 0.44% 0.51% 0.48% 0.42% 0.43% 0.23% 2018Y 2019Y 2020Y 2021Y 2022Y 2023Y 2018Y 2019Y 2020Y 2021Y 2022Y 2023Y NP
Slide 12: Strong Underwriting Culture
Strong Underwriting Culture Comprehensive Underwriting Disciplined LTV and DSC standards Loan origination process supported by specialized teams Multi-Faceted Stress Testing of credit analysts Every loan tested during underwriting process High-quality direct commercial lending platform with
Slide 13: Deposit Franchise
Deposit Franchise ($ in millions) Deposit Composition as of Dec. 31, 2023 Uninsured Deposits as of Dec. 31, 2023 Demand Total Bank Unconsolidated Deposits (RC-O Memo Noninterest- item 1.) $ 11,243 Time bearing 34% 17% Estimated Uninsured Deposits (RC-O Memo item 2.) $ 6,152 Less: Collateralized Depo
Slide 14: Deposit Franchise (cont.)
Deposit Franchise (cont.) Granular Client Deposit Composition as of December 31, 2023 Public Administration Other Services Accommodation and Food Services Arts, Entertainment, and Recreation Public Administration, 12% Health Care and Social Assistance Educational Services Admin & Support;Waste Manag
Slide 15: Enhancing Our Deposit Franchise
Enhancing Our Deposit Franchise Tech Expanded Market Investments Business Lines Diversification Partnerships with Mantl and Nymbus provide opportunities to Continued momentum from our Florida market is rich with deposit leverage modern tech to C&I team is accelerating valuable opportunities efficien
Slide 16: Disciplined Expansion Through M&A with Demonstrated Expertise as a Skilled Acquiror
Disciplined Expansion Through M&A with Demonstrated Expertise as a Skilled Acquiror Completed in-Market Acquisition of $1B Completed transaction on Commercial Bank on January 2, 2020 January 2, 2019 and integrated systems less than 30 days after closing Enhances Scale and Future Growth Market
Slide 17: Active M&A Environment
Active M&A Environment Opportunities in Market Disruption Talent • We’ve experienced increased success in attracting revenue generating talent • Due to disruption, individuals are seeking out ConnectOne New Business Lines • The opportunity to pick up clients who have been displaced by transactions c
Slide 18: Acceleration of Growth: Tech-Forward Leadership
Acceleration of Growth: Tech-Forward Leadership Building a Leading Commercial Bank, Powered by Best-in-Class Technology Building the Future of Banking Investments in technology support the growth of ConnectOne’s high performance, low efficiency model Continued investments to enhance the bank’s o
Slide 19: Acceleration of Growth: Tech-Forward Leadership
Acceleration of Growth: Tech-Forward Leadership Capitalizing on Niche Specific Opportunities BoeFly Today’s BoeFly Ecosystem With proprietary technology, BoeFly helps connect small to mid-sized businesses with professional loan brokers and lenders across the United States BoeFly operates as a sepa
Slide 20: Best-In-Class Efficiency
Best-In-Class Efficiency One of the Best Efficiency Ratios in the Industry Historical Historical Operating Operating Performance Performance Locations utilize technology to 61.6 % serve as “business hubs” $19MM Assets Per 56.2 % supporting clients beyond Employee 55.8 % 54.8 % 54.9 % 51.7 % geograph
Slide 21: A People First Culture with Recognized Success
A People First Culture with Recognized Success Pennsylvania 21
Slide 22: Strategy & Vision
Strategy & Vision CNOB: A Compelling Investment Opportunity Consistent Financial Performance- Among Best-in-Class Solid Credit Culture with Disciplined Lending Philosophy Track Record of Superior Organic Growth Financially Prudent Acquiror and Experienced & Efficient Merger Integrator Benefitting fr
Slide 23: ConnectOne Bancorp, Inc.
& ConnectOne Bancorp, Inc.
Slide 24: Appendix
Appendix jonnectOne Bancorp, Inc.
Slide 25: Loan Growth Metrics (ex. PPP)
Loan Growth Metrics (ex. PPP) Loan Portfolio & Origination Metrics ($ in millions) $2,500 8.17% 8.42% 7.93% 7.92% 9.00% 6.94% 8.00% $2,000 7.00% 4.50% 4.67% 5.54% 5.63% 5.81% 5.35% 5.49% 4.68% 5.20% 6.00% $1,500 4.02% 4.77% 5.00% $924 $1,038 4.00% $1,000 $585 $596 $631 3.00% $511 $394 $407 $416 2.00
Slide 26: Multifamily Portfolio Additional Detail
Multifamily Portfolio Additional Detail Multifamily as of December 31, 2023 New York City (“NYC”) Multifamily December 31, 2023 Multifamily NYC Free Market 7% All Other Loans Outside NYC Non-Majority NYC Rent Regulated Multifamily 75% 5% 69% 31% Majority NYC Rent Regulated 13% • NYC “Majority Rent R
Slide 27: CRE Office Portfolio as of December 31, 2023
CRE Office Portfolio as of December 31, 2023 Geographic Composition NYC Office Majority Tenant Composition FL Other Restaurant 6% 1% Manufacturing 4% Other NYC 6% Boroughs Professional All Other 13% Services 24% 10% Manhattan 6% Private Schools 12% NJ 61% NY (Ex NYC) 13% Medical Office 24% Commercia
Slide 28: Reconciliation of GAAP and Non-GAAP Measures
Reconciliation of GAAP and Non-GAAP Measures As of or For the Quarters Ended, ($'s in thousands) Dec. 31, 2023 Sep. 30, 2023 Jun. 30, 2023 Mar. 31, 2023 LTM Return on Equity Measures Net Income Available to Common Stockholders $ 17,764 $ 19,898 $ 19,885 $ 23,420 $ 80,967 Amortization of Core Deposit
Slide 29: Reconciliation of GAAP and Non-GAAP Measures, Continued
Reconciliation of GAAP and Non-GAAP Measures, Continued As of or For the Quarters Ended, As of or For the Years Ended December 31, ($'s in thousands) Dec. 31, 2023 Sep. 30, 2023 Jun. 30, 2023 Mar. 31, 2023 LTM 2018 2019 2020 2021 2022 2023 Efficiency Measures Total Noninterest Expenses $ 37,845 $ 35
Slide 30: Reconciliation of GAAP and Non-GAAP Measures, Continued
Reconciliation of GAAP and Non-GAAP Measures, Continued As of or For the Quarters Ended, As of or For the Years Ended December 31, ($'s in thousands, except per share data) Dec. 31, 2023 Sep. 30, 2023 Jun. 30, 2023 Mar. 31, 2023 2020 2021 2022 2022 Book Value Per Share: Stockholders equity $ 1,216,6
Slide 31: Reconciliation of GAAP and Non-GAAP Measures, Continued
Reconciliation of GAAP and Non-GAAP Measures, Continued As of or For the Years Ended December 31, ($'s in thousands) 2018 2019 2020 2021 2022 2023 Net Loan Charge-Off (Recoveries) Detail: Average Loans (Including Loans Held-for-Sale and Nonaccrual Loans) $ 4,330,874 $ 5,049,458 $ 6,198,753 $ 6,419,6
ConnectOne Bancorp — Investor Presentation (February 2024) on 6ix