Customers Bancorp, Inc · NYSE:CUBI
Customers Bancorp — Investor Presentation (February 2014)
30 slides from Customers Bancorp's investor presentation, Feb 10, 2014
Slide 1: Focused on Delivering Profitable Growth
Focused on Delivering Profitable Growth Investor Presentation January 2014 NASDAQ: CUBI
Slide 2: Forward-looking statements
* This presentation as well as other written or oral communications made from time to time by us, may contain certain forward-looking information within the meaning of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended. These statements relate to future event
Slide 3: Forward-looking statements (continued)
* timely development and acceptance of new banking products and services and perceived overall value of these products and services by users; volatility in the credit and equity markets and its effect on the general economy; the potential for customer fraud, especially in our mortgage warehouse lend
Slide 4: Investment Proposition
* Investment Proposition ~$4.2 billion asset bank Well capitalized at 13% + total risk based capital and 10% + tier 1 leverage Target market from Boston to Washington D.C. along interstate 95 ROA of .95% and ROE of 9.49%; eight quarters of record core earnings 3.18% net interest margin 165% compound
Slide 5: Current Company Overview
* Current Company Overview Source: SNL Financial and Company data. Note: Branch proposed in northeastern Philadelphia. *Source: Company Documents. ~$4.2 bn institution with 18 sales offices with target market from Boston to Washington D.C. Operating in key Mid-Atlantic and Northeast markets New York
Slide 6: 2013 Financial Highlights
* 2013 Financial Highlights Reported earnings of $32.7 million an increase of 37% Fully diluted earnings of $1.43 for 2013 Net Interest Income up 44% RECORD NET INCOME FOR FULL YEAR 2013 AND 4Q 2013 EXECUTION OF ORGANIC GROWTH STRATEGY Added teams in New England, New York and Pennsylvania Loans rece
Slide 7: 2013 Revenue Growth and Strong Credit Quality Results in Record Earnings
* 2013 Revenue Growth and Strong Credit Quality Results in Record Earnings Q4 2013 net income of $9.0 million is up 19% over 4Q 2012 mainly due to net interest income fueled by net loan growth while maintaining high credit quality and also growing low cost core deposits throughout the year Net inter
Slide 8: Disciplined Model for Increasing Shareholder Value
* Disciplined Model for Increasing Shareholder Value Build tangible book value per share each quarter via earnings Strong organic revenue growth + efficient, scalable infrastructure result in sustainable double digit EPS growth A clear and simple risk management driven business strategy Above averag
Slide 9: Success Factors Align With Shareholder Value Creation Model
* Success Factors Align With Shareholder Value Creation Model High Credit Quality - ensures low non-performers and charge offs. Revenues 2X Expenses – gets bank to 50% or less efficiency ratio through positive operating leverage. Customers Come First - results in strong relationships, customer refer
Slide 10: Customers Bank Advantage
* Customers Bank Advantage Cash Management Residential Real Estate Credit Cards Commercial Real Estate Commercial Banking Retail Branches Client Makes One Call Client High Touch supported by High Tech Single Point of Contact Banking Private / Personal Bankers Concierge Banking Other Products/ Servic
Slide 11: Single Point of Contact Pays off in Strong Loan and Deposit Growth
* Single Point of Contact Pays off in Strong Loan and Deposit Growth Overcame a $700 million decrease in 2013 from the mortgage warehouse loans held for sale with growth in multi family/CRE loans of $860 million and commercial and industrial loans growth of $265 million in 2013 New Banking teams in
Slide 12: Results in Disciplined & Profitable Growth
* Results in Disciplined & Profitable Growth Revenue ($mm) Core Net Income (1) Source: SNL Financial and Company data. Core income, on a diluted per-share basis is net income before extraordinary items, less the after-tax portion of income from investment gains and nonrecurring items. CAGR calculate
Slide 13: Strong Loan Portfolio Growth
* Strong Loan Portfolio Growth Loan Portfolio Mix ($mm) High credit quality results from Customers’ underwriting standards and conservative loan mix Centralized credit committee approval for all loans Average C&I loan < $2.0 million Average Multi-family loans < $5 million; concentrated in New York C
Slide 14: No charge-offs on loans originated since 2009
* No charge-offs on loans originated since 2009 0.43% of NPAs from non-FDIC covered and acquired loans Strong credit and risk management cultures Strong Credit Quality Source: Company documents. *Excludes accruing TDRs and loans 90 days+ past due and still accruing. Non-covered Nonperforming Assets
Slide 15: Deposits: Organic Growth With Controlled Costs
* Deposits: Organic Growth With Controlled Costs Source: Company data. Total Deposit Growth ($mm) Average DDA Growth ($mm) Cost of Deposits Deposits per Branch ($mm) Customers strategies of single point of contact and recruiting known teams in target markets produce rapid deposit growth with low tot
Slide 16: Strong Capital Levels Enable Growth
* Strong Capital Levels Enable Growth Strong capital enables asset and deposit growth Customers raised $200+ million of equity capital in past 18 months at book value or better Current capital levels will provide for over $1.0 billion of growth (assumes risk weighted assets are 90% of total assets)
Slide 17: Strong Growth Provides for Shareholder Value Creation
* Strong Growth Provides for Shareholder Value Creation Per share tangible book value up 34% since December 2010 Focused on continuous growth of TBV aligns executive management compensation with shareholder value creation Strategies and key decisions are framed by estimated effect on per share TBV C
Slide 18: Highly Experienced Management Team
* Highly Experienced Management Team
Slide 19: Focus in future years
Focus in future years Single point of contact model – “High touch supported by high tech” Superior credit quality Above average organic growth Expense management Earnings per share growth estimated at ~ 17% year over year Assumes no additional common shares are issued during 2014 or 2015 Expecting m
Slide 20: Board of Directors
* Name Position Background Jack Miller, CPA (Retired) Director (Financial Expert) • Former Vice Chairman of KPMG • Former Chairman of the US Comptroller General's Governmental Auditing Standards Advisory Council Larry Way, CPA (Retired) J.D. Director (Chairman of the Audit Committee) • Former Chairm
Slide 21: Comparison – Signature Bank SBNY
* Comparison – Signature Bank SBNY Highly successfully bank with similar banking model
Slide 22: Comparison: Texas Capital Bancshares TCBI
* Comparison: Texas Capital Bancshares TCBI Highly successfully bank with similar banking model
Slide 23: Peer Group Comparison
* Peer Group Comparison High Performance Regional Peers Source: SNL Financial, Company documents. Market data as of 9/30/13. Consists of Northeast and Mid-Atlantic banks and thrifts with assets between $2.0 billion and $6.0 billion and most recent quarter core ROAA greater than 90bps. Excludes merge
Slide 24: Summary
* Summary Strong high performing ~$4.2 billion bank with significant growth opportunities “High touch, high tech” processes and technologies result in superior growth, returns and efficiencies Shareholder value results from the combination of increasing tangible book value with strong and consistent
Slide 25: Contacts
* Contacts Company Robert Wahlman, CFO Tel: 610-743-8074 rwahlman@customersbank.com www.customersbank.com Investor Relations Ted Haberfield President, MZ North America Tel: 760-755-2716 thaberfield@mzgroup.us www.mzgroup.us
Slide 26: Customers Bancorp, Inc.
Customers 2. Bancorp, Inc.
Slide 27: Balance Sheet
Ba | ance S h eet Customers Bancorp, Inc. —<—<—<—<—<——— ‘CONSOLIDATED BALANCE SHEET- UNAUDITED (Doles in thousands) December31, September30, December 3, 13 2013 212 ASSETS (ash and due from banks S 5933 § 8832 $908 Interest earning deposits W379 167321 173,108 CCashand cash equivalents 233,068 255,6
Slide 28: Income Statement
Income Statement cencngaan t an ‘GONSOUDATED STATEMENTS OF OPERATIONS - UNAUDITED {Dots tousones, excep peshare doo) a @ a farvear raver ‘ois sle a ee ey saa rece ng aims 1580 osm msi tester eie 20 ee mt ‘one ‘om Totlinerestincme mer Bsst as Wise Se Deposits sam sam ion ators Fede nds pred ” 2 ‘ % O
Slide 29: Net Interest Margin
Net Interest Margin cencngaan t lll, ee ‘Average Balance Sheet / Net Interest Margin (Dollars in thousands) ‘Three Months Ended December 31, 2013 2012 ‘Average yield “Average vield Average Balance orcost (% ‘Average Balance or cost() Assets Interest earning deposits $ 1722 025% $ 202,178 0.25% Inves
Slide 30: Asset Quality
Asset Quality a ee an ‘Asset Quality as of December 34, 2013 (Dollars in thousands) Non Other Real Performing Allowance Total Total Loan Type Non Accrual Estate ‘Assets forloan Credit Cash Credit’ ©—=NPA'S—Reservesto Total Loans _INPL's __ Owned __(NPA’s)_losses_—Mark Reserve _Reserves Total Loans _
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