Red River Bancshares, Inc. · NASDAQ:RRBI
Red River Bancshares — Investor Presentation (September 2021)
35 slides from Red River Bancshares's investor presentation, Sep 17, 2021
Slide 1: Investor Presentation
INVESTOR PRESENTATION As of June 30, 2021 Nasdaq: RRBI
Slide 2: Forward-Looking Statements and Non-GAAP Information
This presentation contains forward-looking statements that are based on various facts and derived utilizing numerous important assumptions and are subject to known and unknown risks, uncertainties, and other factors that may cause Red River Bancshares, Inc.’s (the “Company,” “RRBI,” “Red River,” “we
Slide 3: Glossary of Terms
Glossary of Terms 3Q22 – Third Quarter of 2022 1Q21 – First Quarter of 2021 2Q21 – Second Quarter of 2021 1H21 – First Half of 2021 3Q21 – Third Quarter of 2021 4Q21 – Fourth Quarter of 2021 2Q20 – Second Quarter of 2020 3Q20 – Third Quarter of 2020 4Q20 – Fourth Quarter of 2020 1-4 FR – One-to-Four
Slide 4: Authentic community banking focused on personal relationships
Authentic community banking focused on building personal relationships and maximizing shareholder value Banking Mortgage Investments 4
Slide 5: Hurricane Ida Update
Hurricane Ida Update Hurricane Ida made landfall on Sunday, August 29 in Southeast Louisiana as a Category 4 hurricane. No significant damage to any Red River Bank locations or impact to personnel. Operational systems, digital and mobile banking, and ATMs fully functional in areas with power and int
Slide 6: Company Overview
As of June 30, 2021: Assets = $2.88 billion Loans HFI = $1.60 billion Deposits = $2.57 billion Market capitalization = $368.0 million Ownership Insiders = 33% Institutions = 18%1 Public and other = 49% Third largest Louisiana headquartered bank based on assets as of June 30, 2021 Included in Forbes
Slide 7: Tangible Book Value Growth
Tangible Book Value Growth Note: Each year on the Tangible Book Value Graph represents year-end financial data. 1Non-GAAP measure. See “Forward-Looking Statements and Non-GAAP Information” on slide 2 and “Non-GAAP Reconciliation” slides in the Appendix for additional information. 2Adjusted for 2-for
Slide 8: Company Strengths
Consistent, long-term track record of financial results and steady growth Conservative credit culture with solid asset quality Stable, low cost core deposit base Strategic banking center network 26 banking centers and 1 LPO/DPO in Louisiana Average deposits per center = $102.8 million Average staff
Slide 9: Growth Strategies
Growth Strategies Historical Asset Growth Method As of June 30, 2021Concentrate on urban markets with growth potential Focused on markets where market share is held by large national and regional banks Target markets with significant disruption by competitors Hire experienced leadership from the mar
Slide 10: Recent Expansion Highlights
Under Renovation Lafayette Banking Center Southwest Market – Lake Charles, Louisiana 4Q20 – Purchased an existing banking center in Lake Charles, Louisiana. 3Q21 – Remodeled and opened the third location in the Southwest market as the 26th Red River Bank banking center on July 6, 2021. Acadiana Mark
Slide 11: Digital Banking Strategy
Digital Banking Strategy 2 Providing our customers with the digital tools to manage their personal and business banking needs Providing a full suite of treasury management systems and services Also supplying access to knowledgeable bankers in addition to digital platforms allowing customers to choos
Slide 12: Competitive Landscape and Deposit Market Share
Red River Bank 1.9% Regions 6.3%First Horizon 7.2% Hancock Whitney 12.8% JP Morgan Chase 17.2% Capital One 18.4% Others 36.2% Red River Bank Markets 1st Banking Center Opened Deposits ($M) Banking Centers Market Rank Deposit Market Share 1 Central 1999 $ 1,484 9 1 st 36.9% Northwest 2006 $ 556 7 6 t
Slide 13: Second Quarter 2021 Financial Results
Quarterly net income increased $174,000 from prior quarter to $8.2 million for 2Q21 Provision for loan losses expense decreased $1.3 million PPP loan income decreased $1.1 million EPS (diluted) was $1.13 and ROA was 1.15% for 2Q21 Assets increased 2.0%, or $57.8 million, to $2.88 billion Non-PPP loa
Slide 14: Year-to-Date Financial Results
Non-GAAP measure. See “Forward-Looking Statements and Non-GAAP Information” on slide 2 and “Non-GAAP Reconciliation” slides in the Appendix for additional information. 1 June 30, 2021 Year-to-Date Financial Results Assets increased 8.9%, or $235.8 million, to $2.88 billion Non-PPP loans increased 3.
Slide 15: Conservative Balance Sheet
(do l l ars i n thousands) As of June 30, 2021 Assets Cash and due from banks $ 33,728 Interest-bearing deposits in other banks 633,744 Securities AFS 512,012 Loans HFI 1,600,388 Loans HFS 12,291 Allowance for loan losses (19,460) Other assets 105,773 Total Assets $ 2,878,476 Liabilit ies Noninteres
Slide 16: Loan Portfolio Overview
Loan Portfolio Overview Loans HFI Mix As of June 30, 2021 Largest Industry Concentrations As of June 30, 2021 (excluding PPP Loans)1 1.6% 1.7% 2.0% 2.3% 3.2% 3.3% 4.2% 4.3% 4.4% 9.5% Finance and Insurance Manufacturing Energy Religious and Other Nonprofit Public Administration Retail Trade Hospitali
Slide 17: Loans By Market
1Non-GAAP measure. See “Forward-Looking Statements and Non-GAAP Information” on slide 2 and “Non-GAAP Reconciliation” slides in the Appendix for additional information. 2Source: Louisiana Workforce Commission data for June 2021 Loans By Market Non-PPP Loans HFI1 Originated by geographic market As of
Slide 18: Health Care Loans
¹Non-GAAP measure. See “Forward-Looking Statements and Non-GAAP Information” on slide 2 and “Non-GAAP Reconciliation” slides in the Appendix for additional information. 2 Health Care Loans Health Care Loans by Subtype As of June 30, 2021 Health care loans as of June 30, 2021, totaled $144.0 million,
Slide 19: Energy Portfolio Loans
3.4% 2.9% 2.2% 1.3% 2.0% 2017 2018 2019 2020 2Q21 ¹Non-GAAP measure. See “Forward-Looking Statements and Non-GAAP Information” on slide 2 and “Non-GAAP Reconciliation” slides in the Appendix for additional information. Energy Portfolio Loans Energy Portfolio As of June 30, 2021 EP / Non-PPP Loans HF
Slide 20: Commercial Real Estate Loans
CRE loans were $578.0 million, or 36.1%, of loans HFI as June 30, 2021 Low levels of CRE relative to state, regional, and national peers CRE criticized loans were $4.3 million, or 0.7% of total CRE loans CRE NPLs were $747,000, or 0.1% of total CRE loans CRE concentration ratios as a % of risk-based
Slide 21: Paycheck Protection Program
2Q21 Forgiveness of PPP1 loans outpaced issuance of PPP2 loans PPP loan income was $1.1 million for 2Q21 and $2.1 million for 1Q21 PPP First Draw (PPP1 and PPP1.2) Loans PPP1 forgiveness and income decreased in 2Q21 vs. 1Q21 As of June 30, 2021, loan payments for 91.2% of the 1,384 PPP1 loans and 87
Slide 22: Asset Quality
¹Non-GAAP measure. See “Forward-Looking Statements and Non-GAAP Information” on slide 2 and “Non-GAAP Reconciliation” slides in the Appendix for additional information. Asset Quality NPAs / Total Assets Asset Quality Metrics As of and for the quarter ended (do l l ars i n thousands) 2Q20 3Q20 4Q20 1
Slide 23: Loan Sectors with Heightened Risk due to COVID-19
Active deferrals, all in the hospitality services sector, continue to decline and were $8.1 million, or 0.5% of non-PPP loans HFI1 as of June 30, 2021 Restaurant portfolio has performed well due to the high proportion of limited service restaurant clients Full service dine-in restaurant clients have
Slide 24: Securities Portfolio
$354.3 $307.9 $335.6 $498.2 $512.0 MBS 57.4% Muni - AFS 41.2% Agency 1.4% 2017 2018 2019 2020 2Q21 MBS Treasury Muni - AFS Muni - HTM Agency Securities Portfolio - Conservative Securities (in millions) Key metrics Securities AFS portfolio totaled $512.0 million as of June 30, 2021 17.8% of assets 2Q
Slide 25: Attractive Core Deposit Base
Attractive Core Deposit Base Deposits increased $54.3 million, or 2.2%, in 2Q21 due to customers maintaining higher deposit balances Cost of deposits was 0.22% for 2Q21; down from 1Q21 due to an eight bp decrease in the rate on interest- bearing deposits No brokered deposits Deposit Mix As of June 3
Slide 26: Profitability Trends
62.69 58.86 59.46 55.77 55.30 2017 2018 2019 2020 1H21 0.95 1.29 1.30 1.22 1.18 2017 2018 2019 2020 1H21 Total Tax Reform 1 2017 adjusted for $2.2 million write-down of deferred tax assets associated with changes in tax legislation 2 2017 EPS data adjusted for 2-for-1 stock split with a record date
Slide 27: Net Interest Margin FTE
0.06% 0.09% 0.09% 0.08% 0.07% 0.41% 0.37% 0.33% 0.27% 0.22% 4.21% 4.04% 4.47% 4.31% 4.00% 3.12% 3.02% 3.08% 2.76% 2.54% 1.83% 1.56% 1.15% 1.17% 1.38% 2.39% 2.35% 2.27% 2.10% 2.07% 0.00% 1.00% 2.00% 3.00% 4.00% 5.00% 2 Q 2 0 3 Q 2 0 4 Q 2 0 1 Q 2 1 2 Q 2 1 Loan Yield NIM - FTE Securities - Tax-Exempt
Slide 28: Loan Yield and Net Interest Ratios Excluding PPP Loans
Non-PPP loan income = $15.3 million yielding 4.01% for the three months ended June 30, 2021 Excluding PPP loans, NIM FTE decreased 5 bps to 2.48%1 ¹Non-GAAP measure. See “Forward-Looking Statements and Non-GAAP Information” on slide 2 and “Non-GAAP Reconciliation” slides in the Appendix for addition
Slide 29: Noninterest Income
Noninterest Income (2Q21 vs. 1Q21) Noninterest Income For the quarter ended June 30, 2021 (dollars in thousands) Noninterest income decreased $372,000 to $6.4 million for 2Q21 Mortgage income decreased $525,000 to $2.4 million for 2Q21 due to reduced mortgage loan demand Debit card income, net incre
Slide 30: Operating Expenses
Operating Expenses (2Q21 vs. 1Q21) Operating Expenses For the quarter ended June 30, 2021 (dollars in thousands) Personnel $8,110 60.6% Occupancy and Equipment $1,329 9.9% Technology $744 5.6% Data Processing $532 4.0% Other Taxes $532 4.0% Legal and Professional $368 2.7%Other Operating $1,777 13.2
Slide 31: Strategic Outlook
Disciplined focus on personal, relationship banking and building shareholder value Prudently deploy excess liquidity in loans and securities Continue building a strong, Louisiana-based, super-community bank Open new Lafayette banking center and continue to expand market share in newer South Louisian
Slide 32: Summary
2 High liquidity levels with opportunity to deploy into loans and securities Diversified loan portfolio with solid asset quality and allowance Record-high quarterly net income of $8.2 million Well capitalized with 10.13% leverage ratio as of June 30, 2021 Consistent returns through June 30, 2021, wi
Slide 33: Appendix
ae RED RIVER BANCSHARES, INC. ~ APPEN DIX”
Slide 34: Non-GAAP Reconciliation
Non-GAAP Reconciliation (do l l ars i n thousands, except per share data) As of June 30, 2021 . As of March 31, 2021 . . As of December 31, 2020 … . As of June 30, 2020 Tangible common equity Total stockholders' equity $ 292,924 $ 284,911 $ 285,478 $ 271,117 Adjustments: Intangible assets (1,546) (1
Slide 35: Non-GAAP Reconciliation
Non-GAAP Reconciliation (do l l ars i n thousands) As of June 30, 2021 . As of March 31, 2021 … As of December 31, 2020 . . As of June 30, 2020 Non-PPP loans HFI Loans HFI $ 1,600,388 $ 1,602,086 $ 1,588,446 $ 1,615,298 Adjustments: PPP loans, net (82,972) (119,358) (118,447) (192,655) Non-PPP loans
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