Citizens Community Bancorp, Inc. · NASDAQ:CZWI
Citizens Community Bancorp — Janney Community Bank Conference (September 2021)
34 slides from Citizens Community Bancorp's conference presentation, Sep 16, 2021
Slide 1: 2021 Second Quarter Results
Filed Pursuant to Rule 433 Registration Statement No. __________ Issuer Free Writing Prospectus Dated October __, 2015 Relating to Preliminary Prospectus Supplement Dated October __, 2015 2021 Second Quarter Results Citizens Community Bancorp Inc. Janney Community Bank Conference Exhibit 99.1
Slide 2: Dates and Periods Presented; Cautionary Note on Forward Looking Statements
DATES AND PERIODS PRESENTED Unless otherwise noted, “20YY” refers to either the corresponding fiscal year-end date or the corresponding 12-months (i.e. fiscal year) then ended. “MMM-YY” refers to either the corresponding quarter-end date, or the corresponding three-month period then ended. CAUTIONAR
Slide 3: Investment Summary
Investment Summary Diversification across geographies and industries reduces risk and enhances growth potential Strong earnings profile, leveraging infrastructure and growth to drive efficiency Strong asset quality in loan portfolios Five percent, or 572 thousand share, stock buyback approve
Slide 4: Values, Vision and Mission
Values Our six main values are: integrity, commitment, innovation, collaboration, focus, and sustainability. Vision Make more possible for our customers, colleagues, communities, and shareholders! Mission Provide the best products, service, and ideas to our customers every interaction every day. Cul
Slide 5: Performance Objectives
Performance Objectives Increase Tangible Book and Shareholder Value Reduced NPA’s & Classified Loans to Peer Group Median Increase Operating Leverage Sustainable Business Practices Targeted growth in TBV of 8-10% and achieve ROA and ROE in the upper half of its peer group Reduce loan deferrals under
Slide 6: Franchise Footprint
Franchise Footprint Minnesota Wisconsin Source: S&P Global Market Intelligence 0 0 0 0 0 0 0 0 0 0 6
Slide 7: Recent Franchise Expansion
Recent Franchise Expansion CZWI has been focused on transforming the Company away from a consumer-based bank into a commercial-focused operation, creating a strengthened franchise value through this process. Total Assets Loans Receivable Total Deposits Source: S&P Global Market Intelligence, co
Slide 8: Diverse Markets in Wisconsin and Minnesota
Source: S&P Global Market Intelligence, eauclairedevelopment.com, greatermankato.com, Google Images CZWI operates in diverse markets within the northwestern region of Wisconsin, metro Twin Cities and the Mankato, Minnesota MSA Eau Claire: Features a broad-based, diverse economy, which is driven
Slide 9: Net Income and Diluted EPS
Net Income and Diluted EPS Source: S&P Global Market Intelligence, company filings Net Income as Adjusted and Diluted EPS Income as Adjusted are non-GAAP financial measures, which management believes may be helpful in understanding the Company's results of operations or financial position and compar
Slide 10: Book Value, Tangible Book Value and Core Net Revenue Detail
Book Value, Tangible Book Value and Core Net Revenue Detail Source: S&P Global Market Intelligence, company filings Tangible book value per share is a non-GAAP measure which management believes may be helpful in better assessing capital adequacy. The reconciliation of Tangible book value per share c
Slide 11: Return on Average Assets and Return on Average Tangible Common Equity
Return on average assets as adjusted, return on average tangible common equity (ROATCE) and ROATCE as adjusted are non-GAAP measures, which management believes may be helpful in better understanding the underlying business performance trends related to average assets and average tangible equity. Rec
Slide 12: Efficiency Ratio, Net Interest Income and Net Interest Margin
Efficiency Ratio, Net Interest Income (NII) and Net Interest Margin (NIM) The efficiency ratio as adjusted is a non-GAAP measure, which management believes may be helpful in better understanding the underlying business performance trends related to non-interest expense. A reconciliation of the effic
Slide 13: Capital Ratios
Capital Ratios Note: 2018 FY represents the completion of the 2018 offering of $65 million, but does not include the acquisition of United Bank Source: S&P Global Market Intelligence, company filings 13 6.2% 12.6% 9.9% 7.7% 7.3% 7.6% 0.0% 2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0% 16.0% 18.0% 20.0% 2017
Slide 14: Asset Quality
Asset Quality Modified Q factor and added deferment factor related to the potential adverse economic impact of Covid‐19 in 2020 Strong credit quality on CCF originated loan portfolio Actively reducing NPAs on acquired loan portfolio 0.07% 0.07% 0.08% 0.08% 0.06% 0.01% 0.00% 0.20% 0.40% 0.60% 0
Slide 15: COVID-19 Related Loan Deferrals
COVID-19 Related Loan Deferrals Dollars in Thousands 15 COVID-19 Deferrals Balance Number of Loans Balance Number of Loans Commercial Deferrals Hotel Loans 31,117$ 5 19,763$ 3 Other Commercial Loans 2,469 9 1,015 3 Total Commercial Deferrals 33,586 14 20,778 6 Residential Deferrals 2,148 17 1,852 14
Slide 16: Loan Portfolio
CRE, C&I, Ag. Related, C&D 87% Residential & HELOC 10% Consumer 3% Loan Portfolio CZWI has transformed its loan portfolio through organic growth and acquisitions Change has occurred from a primarily consumer focused portfolio to a diversified mix consisting of commercial real estate, agricultura
Slide 17: SBA PPP Loans and Net Deferred Loan Fee Accretion
SBA PPP Loans and Net Deferred Loan Fee Accretion 17 Dollars in Millions Balance Net Deferred Fee Income Balance Net Deferred Fee Income Balance Net Deferred Fee Income SBA PPP Loans, December 31, 2020 123.7$ 3.0$ -$ -$ 123.7$ 3.0$ SBA PPP Loan Originations - - 47.5 1.7 47.5 1.7 SBA PPP Loan Forgive
Slide 18: Portfolio Fundamentals: Non-Owner Occupied CRE
Portfolio Fundamentals 54%35% 11% Wisconsin Minnesota Other By Geography As of 06/30/21 • Typically well seasoned investors with multiple projects, track record of success and personal financial strength (net worth/Liquidity) • Maximum LTV =<80% with recourse to owners with >20% interest • Term of 5
Slide 19: Portfolio Fundamentals: Owner Occupied CRE
19% 16% 11% 10% 10% 9% 7% 7% 2% 9% CRE Campground CRE Restaurant CRE Industrial/Manufacturing CRE Retail CRE Senior Living CRE Warehouse/Mini Storage CRE Mixed Use CRE Office Hotels Other Owner Occupied CRE As of 06/30/21 Portfolio Fundamentals 75% 14% 11% Wisconsin Minnesota Other By Geography As o
Slide 20: Portfolio Fundamentals: Multi-family
Portfolio Fundamentals 61% 37% 2% Wisconsin Minnesota Other By Geography As of 06/30/21 100% Multi-family Multi-family As of 06/30/21 • Robust housing markets in Eau Claire and Mankato markets supported by student populations at state universities, technical colleges, and growing population and job
Slide 21: Portfolio Fundamentals: Commercial & Industrial
83% 16% 1% Wisconsin Minnesota Other (1%) By Geography As of 06/30/21 18% 12% 11% 8%8% 6% 6% 5% 5% 4% 4% 4% 3% 6% Manufacturing Public Admin Transportation and Warehousing Wholesale Trade Construction Real Estate, Rental and Leasing Agriculture Retail Trade Administrative Support Education Services
Slide 22: Portfolio Fundamentals: Construction and Development
Portfolio Fundamentals 20% 16% 12%12% 8% 8% 8% 6% 10% Commercial 1-4 Family Construction CRE Multi-family CRE Senior Living CRE Warehouse/Mini Storage CRE Retail CRE Hospitality Other Land CRE Campground Other Commercial & Development As of 06/30/21 48% 37% 15% Wisconsin Minnesota Other By Geography
Slide 23: Portfolio Fundamentals: Agricultural Loans
39% 24% 22% 15% Crop Dairy Other Farming Other Agricultural As of 06/30/21 Portfolio Fundamentals 70% 27% 3% Wisconsin Minnesota Other By Geography As of 06/30/21 • Producers required to have marketing plans to mitigate volatility of commodities • Appropriate crop/revenue insurance and/or dairy marg
Slide 24: Portfolio Fundamentals: Hotel Loans
68% 20% 12% Flagged Historic Boutique Other Hotels As of 06/30/21 Portfolio Fundamentals 51% 32% 17% Minnesota Wisconsin Illinois By Geography As of 06/30/21 • Mainly experienced multi project hoteliers and guarantors with strong personal financial statements (net worth and liquidity) • Mainly flagg
Slide 25: Portfolio Fundamentals: Restaurant Loans
53% 16% 10% 8% 7% 6% Culver's - Limited Service Restaurants Micro Breweries Other National Limited Services Drinking Establishments Other Restaurants As of 06/30/21 Portfolio Fundamentals 79% 20% 1% Wisconsin Minnesota Other By Geography As of 06/30/21 • Experienced developers/operators of national
Slide 26: Deposit Composition
Deposit Composition Focus has been on transforming the deposit composition to core deposits Deposit transformation and growth has been achieved through both acquisitions and organic initiatives 9/30/2016 06/30/21 Source: S&P Global Market Intelligence, company filings Non Interest Bearing Demand
Slide 27: Appendix
Citizens Community Bancorp Inc. Appendix 27
Slide 28: Net Interest Margin Analysis
Net Interest Margin Analysis Source: S&P Global Market Intelligence, company filings 28 (1) Fully taxable equivalent. The average yield on tax exempt securities is computed on a tax equivalent basis using a tax rate of 21% for the quarters ended June 30, 2021, March 31, 2021, December 31, 2020, and
Slide 29: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures 29 GAAP pre-tax earnings 3,822$ 6,609$ 12,277$ 17,280$ 7,451$ 6,426$ Merger related costs (1) 1,860$ 463$ 3,880$ -$ -$ -$ Branch closure costs (2) 951$ 26$ 15$ 165$ -$ -$ Settlement proceeds (3) (283)$ -$ -$ (131)$ -$ -$ FHLB borrowings prepayment fee (4
Slide 30: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures (1) All costs incurred are presented as professional fees and other non-interest expense in the consolidated statement of operations and include costs $0, $0, $0, $341,000, $350,000, and $565,000 for the three months ended June 30 , 2021 and March 31, 20
Slide 31: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures Note: All quarterly periods are annualized for net income / net income as adjusted. 31 2016 2017 2018 2019 2020 Mar-21 Jun-21 Net Income 2,573$ 2,499$ 4,283$ 9,463$ 12,725$ 22,330$ 18,876$ Net Income as adjusted 3,563$ 4,221$ 4,962$ 10,675$ 12,425$ 22,63
Slide 32: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures Note: All quarterly periods are annualized for net income / net income as adjusted 32 2016 2017 2018 2019 2020 Mar-21 Jun-21 Non-interest Expense (GAAP) 20,058$ 22,878$ 29,764$ 42,686$ 43,673$ 9,489$ 10,198$ Merger related costs (701) (1,860) (463) (3,88
Slide 33: Disciplined Acquisition Strategy
33 Disciplined Acquisition Strategy Strategic consolidation of community banks Provides scale and operating efficiencies Adds experienced and knowledgeable banking talent Opportunity to continue commercial loan growth Opportunity to drive down cost of funds Adds portfolios of seasoned lo
Slide 34: Leadership Team
Leadership Team Stephen M. Bianchi Chairman of the Board President & CEO Mr. Stephen M. Bianchi, also known as Steve, has been the Chief Executive Officer and President of Citizens Community Bancorp, Inc. and Citizens Community Federal since June 24, 2016. He has been Chairman of Citizens Community
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