Qcr Holdings, Inc. · NASDAQ:QCRH
Qcr — Investor Presentation (November 2014)
50 slides from Qcr's investor presentation, Nov 24, 2014
Slide 1: Financial Presentation
FINANCIAL PRESENTATION Rockford - November 2014 QCR HOLDINGS, INC. a relationship driven organization”
Slide 2: Forward-looking statements
CR. HOLDINGS, INC. relations| Act of to, descriptions of the financial condition, results of operations, asset and credit quality trends, profitability, projected earings, future plans, strategies and expectations of QCR Holdings Inc. (the “Company”). The assumptions of the Company, are generally id
Slide 3: Forward-looking statements (continued)
‘competition from a wide variety of local, regional, national and other providers of financial, investment and time and costs of implementing such transaction: d possible tone ei) changes i) the effects of war or other confli Juding hi " ughts, toad and flooding, i Commission, “Risk Factors” 2013. s
Slide 4: Non-GAAP Financial Measures
R HOLD! CF INC. relations i NON-GAAP F MEASURES These slides contain non-GAAP. financial measure is a numerical measure of the regi fe registra that excludes amounts, or is subject to adjustments that have the effect of excluding amounts, that are included in the most directly comparable measure cal
Slide 5: Table of Contents
ic. HOLD! CR Table of Contents 6 Who We Are Rockford Bank & Trust ........::esesreeieeee 7 QCR Holdings, Inc. 13 i i 17 Focus Areas .. 28 pi y 29 Strat Advant: 31 Y 32 Appendix 38
Slide 6: Investment Rationale
He relationship di Investment Rationale in lowa (80%) and Illinois (20%) share as bigger banks go up-market
Slide 7: Rockford Bank & Trust Overview
Jan 2005 Aug 2006 Nov 2006 May 2009 Nov 2009 Jun 2011 Sep 2014 Sep 2014 Sep 2014 # of Employees: RRM ROCKFORD RB. BANK & JM) TRUST Rockford Bank & Trust Overview Rockford Bank &qTrust is legally formed. Guilford Road facility is opened. 2014 Executive Council
Slide 8: Rockford Bank & Trust Senior Management
ROCKFORD aS iS & Rockford Bank & Trust enior Management Thomas ©, Budd Brian J, DeBenedetto orl Dis President and Executive Vee President, ‘Senior Vee Preside, Senor Ve Presiden, Chie Exeetve oncer Chit Operating Ofer Test Manager ‘ieasury Management ‘James M, Hanberry da S. Nayent " Execute Vee Pre
Slide 9: Rockford Bank & Trust Financial Results
ROCKFORD aS iS & Rockford Bank & Trust FULLYEAR vio 2011 2013 Net interest income $8,042 $9,087 $9,630 $9,645 $7,161 $7,637 Non-interest income 1,334 1,418 1,109 2m 1,987 2319 Non-interest expense (7,395) (7.747) (2,399) (9,244) (6,853) (7,390) tax pre-provision 1,981 2758 : 3,112 568 Provision (808
Slide 10: Rockford Bank & Trust Deposit Market Share
Angee Rockford Bank & Trust TRUST Deposit Market Share Institution Name. Market Share 1. Alpine Bank & Trust "7 1,033.1 19.70% 2. JPMorgan Chase 7 630.0 12.01% 3. BMO Harris 12 580.9 11.06% 4. Associated Bank 6 459.6 8.76% 5. Riverside Community Bank 4 346.2 6.60% 6. Blackhawk Bank 6 335.9 6.41% 7.
Slide 11: Rockford Bank & Trust Total Assets
Rockford Bank & Trust Total Assets IN MILLIONS OF DOLLARS ‘$100
Slide 12: Rockford Bank & Trust Loans
aaah ia & Trust in Loans IN MILLIONS OF DOLLARS $150 $100
Slide 13: History of QCR Holdings, Inc.
R so Hoi relations History of QCR Holdings, Inc. ‘Assets a8 of September 30, 2054 *DeNovo 1993 $14 Million IPO 2013 it 1 icing to Fifth 1 january 31, 2013 2013 it 2013
Slide 14: Our Geography
© Quad City Bank & Trust hos ‘ “** @ Cedar Rapids Bank & Trust =" i - @ Rockford Bank & Trust oy ~, @ m2 Lease Funds, LLC ©. @ Community Bank & Trust h Our Geography
Slide 15: Corporate Overview
Corporate Overview $2.45 Billion in Assets $1.57 Billion in Loans $1.71 Billion in Deposits Shares Outstanding: 7.9 Million Ownership: Company Benefit Plans 8.0% Institutional & Mutual Funds 19.8% Insiders 13.6% *Data as of September 30, 2014
Slide 16: Top MSAs in Iowa and Illinois
HOLDINGS, INC. gani Top 25 MSAs / lowa and Illinois Number of umber of ‘Total Rein MSA teens Gerais Popultton Housshold cage Napene ge, LANNE sasaort a ass7.20 sera Saints WO coat : ayer 2975 Omar fs. exer sea 4 "ot Der tones viet es henes A 08 const 526 ca908 Davee igang a 7908 ‘ 149 28 eae ear ‘ a
Slide 17: Total Consolidated Assets
CAGR 1994-2014 28.04% Total Consolidated Assets CAGR 1994-2007 82.26% CAGR 2008-2014 7.40% ‘ \ }&T (2005) B&T}(201 N CRBT (2001) \ IN MILLIONS OF DOLLARS 8 8 & 8 56 &§& 8 §& 8 8 & €@ 8 SF fF Fs FE 8 8 8 & $ 8 8 $8 $8 &$ &$ 8 8 $$ $ FS FF FE 4 46 6 6 6 86 6 6 6 6 6 86 6 6 6 & 8 B
Slide 18: Balance Sheet Summary
[OLDINGS, INC. gani He i sot Deconber3t, awe 20 em 7 wi Tso spten, 2018 nosed AWOUNT —% AMOUNT % «AMOUNT %=—=AMOUNT.-—% ~—=—AMOUNT-—%6 AMOUNT. Cath teal nds sold ond s74a95 am «SMR TST om ~—«SODRTE. OH «—«SHOAER SH«=««SHAAGHm«StORTI. aH seeuites se70s20 21% ——Seaueu7 20% — sea 200 ame «stun z8e Dem
Slide 19: Balance Sheet Summary (continued)
‘As of December 31 2008 2010 201 2088 ‘As of Sept30, 2014 (in tnousends) AMOUNT —% = AMOUNT % AMOUNT % AMOUNT —% AMOUNT —% = AMOUNT -% Netloans/leases Total stockholders equi $144,493 7% $149,404 1% sia7s77 6% 180 6 atkHOLDERS eoUrry S':779,646 100% $1,896,635 100% $1,966,610 100% $2,093,730 100% $2
Slide 20: Balance Sheet Composition
set Onenberst, B08 me ma me Totes eros $370,520 $424,847 23% | $652,785 $1,221,815, $1,152,174 63% fe = $1,550,101 otal stoexholders eau $125,598 {ToTAU LIABILITIES AND STOCKHOLDERS’ EquiTy $1,779,646 400% $1,886,695 100% $1,986610 100% $2,088,780 100% $1477 $2,394,953, 100% $2,450,598 100%
Slide 21: Liabilities and Stockholders' Equity
GS, INC. i ‘As of December 31 TOTAL ASSETS INoninterest-bearing deposits $207,844 12% {ToTAU LIABILITIES AND STOCKHOLDERS’ EQUITY 2008 2010 201 2018 ‘As of Sept30, 2014 (in tnousends) AMOUNT AMOUNT — % AMOUNT —% = AMOUNT -% $41,779,648 100% $1,836,635 100% $479,648 100% $1,836,635 100% $1,966,610 10
Slide 22: Income Statement Summary
Net interest income Provision expense Income before taxes, Income taxes let income Less: net income attibutable to non-contrling interests Net income a foldings, Ine. Less: preferred dividends Net income attributable to GCR Holdings, Inc, common stockholders Diluted Earnings Per Share (after preferr
Slide 23: Income Statement Summary (continued)
{in thousands) $84.1 7,649 $64,105 18.847 1746 6,621 25,814 (46.937) (48,549) 62.259) (64,433)"" 19.272 16,721 22011 25,486 (16976) (7484) 6616) arty 6.920) 2,296 9.287 13,998 6a 19,556 618) 2049 14838 1960 Less: net in able to non-contoing interests an 48 . - Net income attributable to QCR Holdings
Slide 24: Income Statement Summary (continued)
{in thousands) Not intrest incor 950,682 $49,864 984,145 987,649 $64,105 Non-interest income 18.847 1746 6,621 25,814* 15.16 Non-interest expense (46.937) 60.993) 62.259) (64.499)"" (48,635) Prectax pre-provision 19272 0.61 22011 25,486 17819 (16976) 6616) arty 6.920) 2.286 257 13,998 7.64 19,556 e4
Slide 25: Community National Bank Transaction
HOLDING: relationship driven org ity i Transaction Community National Bank: Rammell in 1997 Headquartered in Waterloo, Recut Proforma ns C Bank & Trust | e ‘Acquired by QCRH May 13,2018 $ 822 Million in assets Community National Bank Q4 2013 $ 611 Million in deposits $277 Million in assets ili 5 Fac
Slide 26: QCR Stock Metrics
QCR Stock Metrics HOLDINGS, INC. 2009 - Q3 2014, ‘Stock Price -*-TBW/Share 2009 2010 2011 2012 2013 Q12014 Q22014 Q3 2014 aes ($0.46) $0.53 $0.92 $1.85 $2.08 $0.40 $0.45 $0.50
Slide 27: Stock Metrics
wk INC. gat Diluted EPS P/TBV Per Share = Stock Metrics 2009-3 2014 ‘Stock Price -*-TBW/Share 2009 (80.46) P/E = 2010 2011 2012 2013 $0.53 $0.92 $1.85 $2.08 105.50% 9.13 x LTM (as of 9/30/14) Q1 2014 Q2 2014 Q3 2014 $0.40 $0.45 $0.50
Slide 28: Focus Areas for Increasing Value
HOLD! CE eo we NDA Bw N Focus Areas for i Value . Grow loans / leases . Continue to improve our Net Interest Margin . Maximize gains on SBA/USDA loan sales Grow Wealth Management income Drive down efficiency ratio as we work to achieve a 1% ROAA Continue to grow TCE organically, with a target of 6.5
Slide 29: History of Capital Transactions
History of Capital Transactions Private Placement of SIM in Preferred Stock at 9.75% Private Placement of $1.5M in Preferred Stock at 9.75% 3 for 2. Common Stock Split ‘87.33 per share today) Craenton of $12M at 9.20% TRUPS) 19 Stock Split Pooled Tiust Preferred SSM floating at Libor + 1.80% Buy bac
Slide 30: Capital Plan
QCR ‘HOLDINGs, Capital Plan * Continue t TCE organically, with a target of 6.5%. f capital to benefit common shareholders. * Consider additional i Juisition opportuniti (Shelf Registration filed June 2014) * Our capital plan is consistent i i f the new regulatory capital guidelines (Basel m1).
Slide 31: The Strategic Value of Our Charters
wk IN ipdriven orga he Strategic Value of our ican Charters local decisions, local lutions, centralized and efficient manner Credit quality better than peers Historic deposit growth better than peers Historic loan growth better than peers ‘Wealth Management, BA/USD, lending, and m2 Leasin;
Slide 32: Key Differentiator: Group Operations
HOLDINGS, Key Differentiator: Group Operations ¢ Accounting — John Oakes ¢ Customer Service/Item Processing — Kathy Francque Beth E. Pi Pi d John Rodrigue: ¢ Funds Management — John McEvoy Till 1 Shellee <I} 1 ¢ Information Technology — Michael Wyffels and John Rodriguez ¢ Internal Audit — Tim Hardi
Slide 33: Key Differentiator: Correspondent Banking
¢ 2¢ RR HOLDINGS, INC. Key Differentiator: Correspondent Banking iq) Pi p' * Depth of product offerings: ~ Loan Participations ~ Bank Stock Financing - Credit Card Services - Fed Funds Lines oF Wisconsin. . 1 | fl b y Total Bank KL 9)
Slide 34: Key Differentiator: Wealth Management
Key Differentiator: Wealth Management P 1 + Depth of product offerings - Financial Planning = Assct Management - Trust Services - Estate Planning - Brokerage and RIA = Insurance - Family Office - Qualified Plans p “big banks are going up market”
Slide 35: Key Differentiator: SBA - USDA Lending
¢ 2¢ RR HOLDINGS, INC. Key Differentiator: org SBA - USDA Lending ‘relationship SBA Loans Originated for the Fiscal Year Ending 9/30/14 k & Trust — 8" in th olume) & Trust — 1 olume) Rockford Bank & Trust — 13" in th ‘olume) 8th in the state of Illinois (# of loans) USDA Lending for Fiscal Year Endi
Slide 36: Key Differentiator: m2 Lease Funds, LLC
wt INC. driven org; relations Key Differentiator: m2 Lease Funds, LLC 20140370 ‘Assets (in millions) Pre-Tax Earnings * Net Charge-ofsto Leases 3530 $875,651 014% $687 $1,421,142 0.78% $707 $784,424 033% $906 $ 855679 134% $3854 $962,741 101% seas $ 2,089,470 118% $109.7 $3,367,182 0.64% $126.0 $3,6
Slide 37: Thank You
Thank You For Your Time Today Questions
Slide 38: Appendix
HOLDINGS, INC. Appendix
Slide 39: Quad City Bank & Trust Highlights
R HOLD! CF INC. relations Quad City Bank & Trust SHAD Highlights - Quad Cities BANK & RUST + The Rook Island Arsenal is the largest government-ovined miliary weapons manufacturing arsenal inthe United States H. Anderson, President & CEO + Alooa (Quad Cities) is the world's premier aerospace supply p
Slide 40: Cedar Rapids Bank & Trust Highlights
Cedar Rapids Bank & Trust Highlights - Cedar Rapids International Headquarters for Rockwell Collins sadquarters for Aegon U + Downtown Revitalization ~ Double Tree by Hilton Cedar Rapids Convention me J. Helling, President & CEO ‘Complex $144MM, 2 year project (riche in 100,000 sqft convention napa
Slide 41: Rockford Bank & Trust Highlights
. Budd, President & CEO Thomas D. Assets: $347 Million (as of 9/30/14) Population: 343,245 Market Deposits: $6.1 Billio ara 9 th, 9% mac to ver $290 en raMSA Matt Stores emi Medical Center wineba0 Cou Woodward, ups Rockford Bank & Trust Highlights - Rockford args at erence comny in Neth Ane, nites h
Slide 42: Community Bank & Trust Highlights
(COMMUNITY BANK & Stacey J, Bentley, President & CEO Assets: $164 Million* (as of 9/30/14) Population: 169, Market et Deposits $3.0 Billior i ‘2p ath 40% rt sae gd ov 8127 Monn ts in Waterloo / Cedar Falls MSA, Major Employers ‘Omega Cabinetry Lid. CBE Companies, Inc. Bertch Cabinets Community Bank
Slide 43: Loan Portfolio Composition
LDINGS, INC. el Hoi relations Loan Portfolio Composition September 30, 2014 IN MILLIONS OF DOLLARS TYPE Dollar Mi Percent Mix Commercial & Industrial $ 479.7 31% Non Owner Occupied Commercial Real Estate 376.8 24 Owner Occupied Commercial Real Estate 251.0 16 Residential Real Estate 155.0 10 Direct
Slide 44: Peer Credit Analysis
R iGS, INC. Peer Credit Analysis a Performing Assets / Asset: relationship di INSTITUTION, TICKER _NPAS/ASSETS: Peer Grou} fern France USA, " sat creat Southem Bancorp ne c 392 Fst Busey Coporaton Buse on A 20RH _—s=Median Entepise Fnancel Services Cop 4 Fst Financia! Cxperaton q 163 260 } sand Fina
Slide 45: Charge-Off Analysis
Charge-Off Analysis 2008-2014 02500) ‘23107 60m) 23107) 200-2014 a (S00) 9 ‘OCR HOLDINGS, INC. AND SUBSIDIARIES: ‘oR Hogs ne 1.09382 an 1 ssces 20% ‘vad cy eran ‘ art 2% 72810 256% (ear Rapid Barkan Ts Company 1os80 a 270% 9719 200% canny 2, aa ‘Sexrce: SNL Finan Data asf une 30,2014
Slide 46: Securities Portfolio Snapshot
HOLD CE INC. Snapshot=As of 12.31.43 { QCR ris Inc. ‘Source: $2818 and 4044 FM Fadl Repe Provecreo Beck % Tool _Ganoss Book 37. (20,106) 2 4 r 128, 1 (270) 4 «5 m, (6.62) 8 9 2 78, 1 (23.72) ROVECTED Bookie Gainnoss Book Viel _Repree Tem 314.900 e ‘@or 178 19.08 1 240 470 400 263 r 308 106,181 c (i
Slide 47: Wholesale Funding
QCR Holdings, Inc. unding September 20,2014 December 31,2018 (eter amounts in touzonds) Brokered time deposits 5 95841 5 61.920 Federal Home Loan Bank advances 198,500 231,980 ‘Structured repurchase agreements olesale +30,000 £30,000 [Total Wholesale Funding $442,341 $423,280 ‘Soptomber 0, 2014 Dece
Slide 48: QCR Holdings Executive Management Team
LEFT TO RIGHT Doug Hultquist Tom Budd Bill Tank Todd Gipple John Rodriguez Front Row (sealed) John Engelbrecht Shawna Graham John Anderson Cathie Whiteside Jill DeKeyser Michael Wytfels QCR Holdings, Inc. Executive Management Team OUR MISSION: ICR Holdings
Slide 49: Executive Management Team
He Executive Management Team DOUGLAS M, HULTQUIST, CPA RICH W. COUCH JANA L. NICHOLS. resident and Chief Executive Officer President and Chief Executive Offesr, Executive Viee President, Chief Lending Offcer, £37 Yeass in Banking / Financial Services ma lease Funds tC Coder Rais Banke Tust Comoany 7
Slide 50: Contact
3551 7" Street Moline, Illinois 61265, www.gerh.com QCR HOLDINGS, INC.