Rbb Bancorp · NASDAQ:RBB
Rbb Bancorp — IPO Roadshow (July 2017)
33 slides from Rbb Bancorp's IPO roadshow presentation, Jul 18, 2017
Slide 1: Initial Public Offering Free Writing Prospectus
July 2017 Initial Public Offering Free Writing Prospectus Filed Pursuant to Rule 433 Registration Statement No. 333-219018 Dated July 18, 2017
Slide 2: Offering Disclosure
Offering Disclosure This presentation has been prepared by RBB Bancorp (“RBB” or the “Company") solely for informational purposes based on its own information, as well as information from public sources. This presentation has been prepared to assist interested parties in making their own evaluation
Slide 3: Offering Summary
Offering Summary Issuer Ticker Symbol / Exchange Overallotment Shares Offered Structure Lock-Up Use of Proceeds Filing Range Book-Running Managers RBB Bancorp RBB / NASDAQ Global Select 3,000,000 70% Primary / 30% Secondary $22.00 - $24.00 per share 15% (100% Primary) 180 Days Sandler O’Neill + Part
Slide 4: Experienced Leadership Team
Experienced Leadership Team Average 31 years of bank management experience in finance, lending, credit, risk, strategy and branch operations Name / Title Experience Background Yee Phong (Alan) Thian President & Chief Executive Officer 35 years Chairman, President and Chief Executive Officer (“CEO”)
Slide 5: RBB Bancorp – Who We Are
RBB Bancorp – Who We Are Non-GAAP reconciliation in Appendix on page 29 Nonperforming assets include nonaccrual loans, loans past due 90 days or more and still accruing interest, loans modified under troubled debt restructurings, a SBA guaranteed loan as to which RBB received a $3.6 million payment
Slide 6: Investment highlights
High-performing community bank with defined and proven strategy to grow both organically and through acquisitions High level of insider ownership and deposit concentration aligns interest with investors Experienced management team and Board of Directors with demonstrated industry knowledge, regulato
Slide 7: Our History and Strategy
September: Acquired July: Acquired January: Established 2011 Our History and Strategy Historical Timeline May: Acquired Received Outstanding Overseas Taiwanese SME Award 2013 Earned Findley Reports’ “Super Premier” status 2015 Opened 2008 Opened SBA banking unit 2010 Raised over $54mm in private off
Slide 8: Our Current Footprint
Our Current Footprint Branches (13) LPO (1) Los Angeles County, California Clark County, Nevada Ventura County, California Arcadia Cerritos Diamond Bar Los Angeles (Downtown) Los Angeles (Westwood) Los Angeles (Silver Lake) Monterey Park Rowland Heights San Gabriel Torrance City of Industry* *Loan P
Slide 9: Key Highlights of Our Current Markets
Key Highlights of Our Current Markets: Los Angeles County, CA | Ventura County, CA | Clark County, NV Source: U.S. Census Bureau Los Angeles County, California Part of the Los Angeles-Long Beach-Anaheim, California Metropolitan Statistical Area (“MSA”) Largest MSA in California with over 13 million
Slide 10: Substantial Opportunities for Acquisitions: Chinese-American Banks Across the U.S.
Substantial Opportunities for Acquisitions: Chinese-American Banks Across the U.S. Chinese-American bank universe as defined by RBB’s management team Count refers to total number of Chinese-American banks that are headquartered in the indicated MSA Source: SNL Financial, 2010 Census Chinese-American
Slide 11: Demonstrated Track Record of Balance Sheet and Earnings Growth
Demonstrated Track Record of Balance Sheet and Earnings Growth Non-GAAP reconciliation in Appendix on page 30 Total Assets ($mm) Total Loans ($mm) Total Deposits ($mm) Adjusted Earnings¹ ($mm) 2012 – Q1 2017 CAGR = 25.3% 2012 – Q1 2017 CAGR = 35.9% 2012 – Q1 2017 CAGR = 27.6% 2012 – 2016 CAGR = 64.9
Slide 12: Diversified Loan Portfolio
Diversified across industry lines and minimal demand for non-mortgage consumer credit $1.2 billion total loans as of March 31, 2017 82% originated vs. 18% acquired Average yield on loans of 5.51% for the first quarter of 2017 Diversified Loan Portfolio Excludes purchased loan discounts and deferred
Slide 13: Business Line Profile
Business Line Profile Between $1 million and $25 million annual revenue CRE Lending Real estate loans for owner occupied and non-owner occupied commercial property; includes construction and land development (“C&D”) loans High quality credits Low LTV ratios (policy limit of 75%) Income-producing pro
Slide 14: Business Line Profile: CRE Lending | C&D Lending
~17.9% fixed rate Decreased primarily from continued pay-off of TomatoBank loans Business Line Profile: CRE Lending | C&D Lending CRE Loans CRE and C&D Portfolio Growth C&D Loans C&D 2012 – Q1 2017 CAGR = 28.4% CRE 2012 – Q1 2017 CAGR = 11.5% (Dollars in millions) First quarter 2017 construction loa
Slide 15: Business Line Profile: C&I Lending | SBA Lending
Increase in shared national credits, mortgage warehouse lines and purchased receivables Business Line Profile: C&I Lending | SBA Lending Credit Lines include commercial and industrial lines of credit, term loans, mortgage warehouse lines and international trade discounts C&I Loans SBA Loans As of Ma
Slide 16: Business Line Profile: 1-4 Single Family Residential Lending
As of March 31, 2017: No nonperforming loans¹ in the SFR portfolio Average: LTV of 57.6%; FICO score of 747; duration of 4.7 years Current start rate of 4.5%; reprices after 7 years to one-year LIBOR plus 2.75% Business Line Profile: 1-4 Single Family Residential Lending SFR Loans Nonperforming loan
Slide 17: CRE Concentration Below Interagency Guidance
CRE Concentration¹ Below Interagency Guidance CRE for the purpose of the CRE concentration ratio measured as total commercial real estate loans less owner-occupied commercial real estate loans plus construction and land development loans; CRE concentration measures this value as a percentage of tota
Slide 18: Disciplined Credit Culture
Disciplined Credit Culture Nonperforming loans include nonaccrual loans, loans past due 90 days or more and still accruing interest and loans modified under troubled debt restructurings, as well as a SBA guaranteed loan at March 31, 2017 and December 31, 2016 and 2015 as to which RBB received a $3.6
Slide 19: Deposit Portfolio as of March 31, 2017
Deposit Portfolio as of March 31, 2017 Growth across all deposit categories, both year-over-year and quarter-over-quarter Top 10 Deposit Relationships = $270.6 million (21.7% of total deposits) 4 of the Top 10 Relationships are with Directors and shareholders of the Company; $87.1 million, or ~32% o
Slide 20: Attractive Net Interest Spread
Attractive Net Interest Spread Note: 2017Q1 profitability metrics reflect annualized values for the quarter Source: Page 19 in S-1 Yield on Average Interest-Earning Assets Cost of Average Interest-Bearing Liabilities Net Interest Spread Net Interest Margin (FTE)
Slide 21: Outstanding Financial Performance
Outstanding Financial Performance Note: 2017Q1 profitability metrics reflect annualized values for the quarter Non-GAAP reconciliation in Appendix on page 30 for RBB’s calculation of core, or “adjusted,” earnings metrics Don’t forget to confirm Appendix page # Source: Page 19 in S-1 Core Return on A
Slide 22: Well-Diversified Revenue Streams
Well-Diversified Revenue Streams Refers to loans acquired in business combinations Refers to the value of the increase in cash surrender of life insurance Significant year-over-year noninterest income growth Increase in customer base Higher amount of loans being serviced Net decrease in recoveries o
Slide 23: Strong Pro Forma Consolidated Capital Position
Strong Pro Forma Consolidated Capital Position Assumes gross proceeds of $48.5 million (2,107,756 primary shares at $23.00 per share), 6.0% underwriting spread, $1.3 million additional expenses and 0% risk-weighting on net proceeds Consists of 6.50% fixed-to-floating rate subordinated notes which qu
Slide 24: Investment highlights
High-performing community bank with defined and proven strategy to grow both organically and through acquisitions High level of insider ownership and deposit concentration aligns interest with investors Experienced management team and Board of Directors with demonstrated industry knowledge, regulato
Slide 25: Appendix
Appendix
Slide 26: Recent Developments
Recent Developments Estimated amounts per RBB management Q2 2017 estimated net income includes an ~$4.2 million (after-tax effect of ~$2.5 million) recapture of a provision for loan losses, reflecting both the receipt of a guaranteed payment on a previously charged-off SBA 7A guaranteed loan of $629
Slide 27: Board of Directors
Board of Directors Yee Phong (Alan) Thian Chairman of the Board Chairman, President and CEO of the Company and the Bank since the Bank began operations in 2008 Peter M. Chang President of Yao Yang Enterprises LLC, which purchases and exports waste paper Wendell Chen CEO of US Development LLC, a real
Slide 28: Investment Portfolio Composition as of March 31, 2017
Investment Portfolio Composition as of March 31, 2017 Comprised of corporate note securities and financial institution subordinated debentures Book value for AFS securities is equal to fair market value; book value for HTM securities is equal to amortized cost Annualized for the three months ended M
Slide 29: Interest Rate Risk Analysis
Interest Rate Risk Analysis Assumes March 31, 2017 reported financial information % Change in Net Interest Income¹ Source: Page 106 in S-1
Slide 30: Non-GAAP Reconciliation: Tangible Common Equity and Tangible Assets
Some of the financial measures included in this presentation are not measures of financial performance recognized by GAAP. These non-GAAP financial measures include “tangible common equity to tangible assets,” “tangible book value per share,” and “return on average tangible common equity.” Our manag
Slide 31: Non-GAAP Reconciliation: Adjusted Earnings
Some of the financial measures included in this presentation are not measures of financial performance recognized by GAAP. These non-GAAP financial measures include “adjusted earnings,” “adjusted diluted earnings per share,” “adjusted return on average assets,” and “adjusted return on average tangib
Slide 32: Core deposits measure
Some of the financial measures included in this prospectus differ from those reported on the FRB Y-9(c) report. These financial measures include “core deposits to total deposits.” Our management uses this financial measure in its analysis of our performance. The Bank measures core deposits by review
Slide 33: How We Measure Core Deposits
How We Measure Core Deposits Demand Deposits Savings Deposits Time Deposits < $250,000 Relationship with RBB Director or shareholder? Deposits within the Bank’s market area? Additional non-deposit services with the Bank? Electronic banking services with the Bank? Active demand deposit account with t