Hometrust Bancshares, Inc. · NYSE:HTB

Hometrust Bancshares — KBW 2017 Community Bank Investor Conference

49 slides from Hometrust Bancshares's conference presentation, Jul 31, 2017

  1. Slide 1: KBW 2017 Community Bank Investor Conference

    KBW 2017 Community Bank Investor Conference August 1-2, 2017

  2. Slide 2: Forward-Looking Statements

    Forward-Looking Statements 2 This presentation includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements often include words such as “believe,” “expect,” “anticipate,” “estimate,” and “intend” or future or conditional verbs such

  3. Slide 3: HomeTrust Bancshares, Inc. Overview

    HomeTrust Bancshares, Inc. Overview Headquarters: Asheville, NC Exchange/Ticker: NASDAQ: HTBI Founded: 1926 Number of Employees: 486 Locations: 42 (NC, SC, VA, TN) Stock Price: $24.45 Total Assets: $3.2 billion Price to TBV: 126% Total Loans: $2.3 billion Market Cap: $463.8 million Total Deposits: $

  4. Slide 4: Strategic Operating Committee

    Strategic Operating Committee 4 Leader Role Age Yrs in Banking Yrs w/HTBI Dana Stonestreet Chairman, President & Chief Executive Officer 63 39 28 Tony VunCannon Executive Vice President & Chief Financial Officer 52 29 25 Hunter Westbrook Executive Vice President & Chief Banking Officer 54 30 5 Howar

  5. Slide 5: Transitioning to a High Performing Community Bank

    Phase I: Created a Foundation For Growth  Lines of Business – Infrastructure and Talent  New markets for growth Phase II: Executing Our Strategic Plan with a Sense of Urgency  Sound and Profitable Organic Growth  Loans  Deposits  Lower our efficiency ratio  Noninterest income growth  Expense

  6. Slide 6: Growth Since 1996

    $318 $431 $585 $605 $609 $686 $711 $722 $748 $885 $926 $1,124 $1,348 $1,470 $1,641 $1,638 $1,720 $1,583 $2,074 $2,783 $2,718 $3,207 $0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 ($000 ) Assets Loans Deposits Tryon Federal Partnership 1996 Shelby Savings Partnership 1998 Home Savings Partnership

  7. Slide 7: Foundation for Growth and Performance

    Foundation for Growth and Performance • Converted to stock in July 2012 and raised $211.6MM • Added 6 larger growing markets in NC, SC, VA and East TN • 4 whole bank acquisitions • 3 new Commercial Loan Production Offices from “lift-outs” of existing commercial lending teams • Purchased 8 Bank of Am

  8. Slide 8: Strong Footprint for Growth

    8 Strong Footprint for Growth

  9. Slide 9: Impact of New Metro Markets

    9 Impact of New Metro Markets Population 890,851 890,851 890,851 890,851 2,222,774 2,222,774 2,512,274 3,113,625 5,625,899 - 1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 - 1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 6,000,000 2012 2013 2014 2015 532% Increase in Market Populatio

  10. Slide 10: HomeTrust Growth Markets

    HomeTrust Growth Markets 10 Asheville, NC MSA  2017 unemployment at 3.5% down from 3.7% in 2016  No. 1 Best in the U.S. Destination for 2017, Lonely Planet, January 2017  No. 3 out of 18 for the World’s Best Cities for Millennials, Matadornetwork.com, May 2016  No. 2 Best Startup City in America

  11. Slide 11: Building a High-Performing Commercial Lending Team

    Changes in the past 5 years Commercial lenders in legacy markets – June 2012 5 Attrition in legacy markets (4) Hired/replaced in legacy markets 4 Acquired through bank acquisitions 21 Attrition after bank acquisitions (17) Hired/replaced in acquired markets 13 “Lift-outs” of commercial teams in 3 ne

  12. Slide 12: Adding Talent for Growth

    12 Adding Talent for Growth Commercial and Line of Business Leaders

  13. Slide 13: New Greensboro Commercial Loan Production Office

    13 New Greensboro Commercial Loan Production Office • Announced July 31, 2017 • Strong new metro market • Greensboro-High Point MSA with population of 723,801 • 3rd largest MSA in North Carolina behind Charlotte and Raleigh • 7th metro market added since our stock conversion • Natural geographic exp

  14. Slide 14: 5-Year Growth Since Conversion

    5-Year Growth Since Conversion 14 Mutual/Stock Fiscal Conversion Year End 09/30/2012 06/30/2017 $ % Total Assets $1,603 $3,207 $1,604 100% Total Loan Portfolio $1,203 $2,351 $1,148 95% Total Deposit Portfolio $1,160 $2,048 $888 77% Checking Accounts 239 779 540 226% Money Market/Savings 337 807 470

  15. Slide 15: Continuing To De-Thrift the Balance Sheet

    15 Continuing To “De-Thrift” the Balance Sheet Organic Loan Growth in Nonmortgage Loans:  Commercial  Commercial real estate (CRE)  Commercial & industrial (C&I)  Commercial Construction  Indirect Auto  SBA Lending  Equipment Finance Core Deposit Growth:  Commercial checking  Fee generation

  16. Slide 16: Loan Highlights

    16 Loan Highlights Loan Portfolio Growth:  Organic loan growth of 14% in FY 2017 vs. 4% in FY 2016 ($243MM vs $75MM)  30% growth in indirect auto loans ($32MM)  53% growth in commercial loans ($400MM* - CRE, C&I, Commercial Construction, Municipal Leases)  88% of fiscal 2017 commercial productio

  17. Slide 17: Loan Portfolio Composition

    Loan Portfolio Composition $ 6 2 1 $ 6 0 2 $ 6 6 0 $ 6 5 0 $ 6 2 4 $ 6 8 4 $200 $182 $223 $336 $459 $518 $411 $383 $615 $700 $750 $1 ,150 $- $500 $1,000 $1,500 $2,000 $2,500 2012 2013 2014 2015 2016 2017 Lo an B ala n ce Fiscal Year 1-4 Family HELOCs & Other Consumer Commercial 5-Year CAGR of 13.81%

  18. Slide 18: Commercial Loan Production by Type

    18 Excludes municipal leases. Dollars in thousands Commercial Loan Production by Type $4,013 $3,971 $28,649 $18,960 $13,389 $35,773 $34,583 $47 ,955 $ 1 1 2 ,3 4 9 $22,933 $16 4 ,945 $13 7 ,660 $92 ,591 $19 2 ,803 $23 8 ,870 $- $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 C&I Commercial Cons

  19. Slide 19: Commercial Real Estate Composition

    Commercial Real Estate Composition 12% 29% 11% 12% 7% 10% 5% 3% 11% As of 6/30/17 Multifamily Owner Occupied Office Retail Hospitality Shopping Centers Industrial Healthcare Other 19

  20. Slide 20: Commercial Production by Market - Legacy/New Markets

    20 22,571 38,151 56,969 53,551 69,902 62,413 12,264 141,336 255,636 461,851 5 5 8 15 19 29 - 5 10 15 20 25 30 2012 2013 2014 2015 2016 2017 $- $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000 $400,000 $450,000 $500,000 $550,000 Legacy New markets CRM/Lenders 88% 12% 69,538 Production by

  21. Slide 21: Consumer Loan Production

    21 Dollars in thousands Consumer Loan Production $15 ,839 $33 ,324 $9,598 $49 ,841 $5 3 ,010 $54 ,598 $87 ,844 $49 ,794 $84 ,707 $- $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000 $90,000 $100,000 HELOC-originated/Consumer Indirect auto Origi n at io n s Fiscal Year 2013 2014 2015 20

  22. Slide 22: Mortgage Loan Production

    22 Mortgage Loan Production $35 ,907 $22 7 ,117 $12 0 ,808 $49 ,455 $ 7 3 ,5 0 1 $68 ,242 $49 ,689 $74 ,353 $89 ,299 $42 ,493 $91 ,963 $81 ,577 $71 ,674 $ 1 3 4 ,2 5 8 $99 ,220 $- $50,000 $100,000 $150,000 $200,000 $250,000 Construction 1-4 Family Brokered 1-4 Family Portfolio Origi n at io n s Fisc

  23. Slide 23: Deposit/Retail Highlights

    23 Deposit/Retail Highlights Deposit Growth:  17% core deposit* growth in fiscal 2017 ($226MM)  24% growth in total checking accounts  41% growth in commercial checking accounts  Core deposits* now make up 77% of total deposits  Average cost of total deposits remained at .28% for fiscal 2017 Cu

  24. Slide 24: Deposit Portfolio Mix

    24 Deposit Portfolio Mix 2012 2013 2014 2015 2016 2017 Time Deposits $629,958 $540,387 $634,154 $577,075 $442,649 $462,146 Money Market/Savings $348,519 $357,876 $530,221 $703,622 $731,137 $806,756 Checking Accounts $230,683 $256,486 $418,671 $591,429 $628,910 $779,549 Core Deposits % (excludes time

  25. Slide 25: Deposit Composition

    Deposit Composition 52.1% 46.8% 40.1% 30.8% 24.6% 22.6% 28.8% 31.0% 33.5% 37.6% 40.6% 39.4% 19.1% 22.2% 26.4% 31.6% 34.9% 38.1% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 2012 2013 2014 2015 2016 2017 Time Deposits Money Market/Savings Checking Accounts $462,146 $806,756 $779,549 Time Deposits Mone

  26. Slide 26: Growing Noninterest Income

    26 Growing Noninterest Income  New SBA Line of Business  Gain from loan sales  Third party servicer to keep overhead low  Mortgage Banking  Expanded into 5 of our new metro markets  Added 10 new mortgage loan officers in the last 12 months  Increasing rates to enhance gain on loan sales  Mov

  27. Slide 27: Creating Efficiencies/Expense Management

    27 Creating Efficiencies/Expense Management  Consolidated 10 branch offices  Closed 6 overlapping rural offices  Consolidated 4 offices related to acquisitions  Branch optimization staffing study reduced expense $375,000 annually  Changed health care insurance providers to avoid $700,000 increa

  28. Slide 28: Asset Quality

    Nonperforming Assets / Total Assets Net Charge-Offs & NCO / Avg. Loans $30,640 $4 ,127 0.34% 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% - 5,000 10,000 15,000 20,000 25,000 30,000 35,000 2012 2013 2014 2015 2016 2017 Net Charge-Offs NCO/Avg. Loans 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% - 5,000 10,000 15,

  29. Slide 29: Current FHLB Leveraging Strategy

    29 Current FHLB Leveraging Strategy  Borrowed $318 million (1) of additional short-term advances from the FHLB.  Average borrowings for the year totaled $578 million.  Borrowings increased FHLB stock requirements to $32 million to take advantage of high dividend rate (4.77% for 4th quarter 2017)

  30. Slide 30: Investment Portfolio Composition

    Investment Portfolio Composition Investments: 6/30/17 ($281 MM) 24% 33% 12% 2%29% US Gov't Agency ($66 MM) MBS-Gov't Agcy/GSE ($93 MM) Munis ($34 MM) Corporate Bonds ($6 MM) FDIC Insured CDs in Other Banks($82 MM) Yield: 1.76% Avg Repricing Term: 2.13 years Investments exclude $245MM in short- term

  31. Slide 31: Continuing to Leverage Capital

    31 • Organic loan growth • Opportunistic acquisitions at reasonable prices • Share repurchases – Repurchased 26% since 2012 conversion • Dividends - None to date with low price to tangible book value 13.06% 11.13% 13.06% 13.89% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% 35.0% Common Equity Tier 1 (1) T

  32. Slide 32: Opportunistic Acquisition Strategy

    32 Opportunistic Acquisition Strategy  Geographic footprint – within or adjacent to our current market footprint  Attractive, growing market  Asset size – Target of $300 million to $800 million  Strong core deposit base  Earnings accretion of 10% or more  Minimum dilution to current tangible b

  33. Slide 33: Stock Buy Backs

    (Dollars in thousands, except per share amounts) Source: Company documents previously filed with the SEC Percent Purchased of Outstanding Shares Number of Shares Total Cost Avg Cost / Share 1st Buy Back (completed 4/29/13) 4% 846,400 13,299$ 15.71$ 2nd Buy Back (completed 12/2/13) 5% 1,041,245 17,05

  34. Slide 34: Quarter Ended June 30, 2017 Highlights

    Quarter Ended June 30, 2017 Highlights (Dollars in thousands, except per share amounts) As Reported 06/30/2017 06/30/2016 Amount Percent Net income 4,766$ 3,302$ 1,464$ 44% EPS - Diluted 0.25$ 0.19$ 0.06$ 32% ROA 0.61% 0.48% 0.13% 27% Net Interest Margin (tax equivalent) 3.53% 3.43% 0.10% 3% Organic

  35. Slide 35: Fiscal Year Ended June 30, 2017 Highlights

    Fiscal Year Ended June 30, 2017 Highlights (Dollars in thousands, except per share amounts) As Reported 06/30/2017 06/30/2016 Amount Percent Net income 11,847$ 11,456$ 391$ 3% EPS - Diluted 0.65$ 0.65$ -$ 0% ROA 0.40% 0.42% (0.02%) -5% Net Interest Margin (tax equivalent) 3.49% 3.37% 0.12% 3.56% Org

  36. Slide 36: Balance Sheet Highlights

    (Dollars in thousands, except per share amounts) 06/30/2017 06/30/2016 Amount Percent Total assets 3,206,533$ 2,717,677$ 488,856$ 18% Total loans 2,351,470 1,832,831 518,639 28% Core deposits 1,586,305 1,360,047 226,258 17% Total deposits 2,048,451 1,802,696 245,755 14% Nonperforming loans/ Total lo

  37. Slide 37: Improving Earnings Performance

    37 Improving Earnings Performance $9,746 $8,256 $11,784 $12,228 $17,111 $0.49 $0.44 $0.61 $0.70 $0.94 $- $0.10 $0.20 $0.30 $0.40 $0.50 $0.60 $0.70 $0.80 $0.90 $- $2,000 $4,000 $6,000 $8,000 $10,000 $12,000 $14,000 $16,000 $18,000 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 Net Income - Adjusted Diluted

  38. Slide 38: Share Price and Price to Tangible Book

    38 Share Price and Price to Tangible Book $16.96 $15.77 $16.76 $18.50 $24.40 96.1% 89.2% 92.8% 97.1% 126.0% 0.0% 20.0% 40.0% 60.0% 80.0% 100.0% 120.0% 140.0% $- $5.0 $10.0 $15.0 $20.0 $25.0 $30.0 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 Share Price Price to Tangible Book

  39. Slide 39: Total Return Performance

    100.0 120.0 140.0 160.0 180.0 200.0 220.0 07/11/12 06/30/13 06/30/14 06/30/15 06/30/2016 06/30/2017 Total Return Performance HomeTrust Bancshares, Inc. NASDAQ Bank NASDAQ Composite Total Shareholder Return 39

  40. Slide 40: Community Banks Headquartered in North Carolina

    40 Community Banks Headquartered in North Carolina $33,612 $36,542 $32,170 $50,502 $20,047 25 25 24 22 12 0 5 10 15 20 25 30 $- $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 Assets No. of Banks Dollars in millions

  41. Slide 41: Proven Growth Strategy

    Proven Growth Strategy • Building on our Strong Organic Growth • 7 new metro markets (including our new Greensboro LPO) • Commercial lending • Mortgage banking • Core deposits • Expanding into new Lines of Business • Indirect auto • Equipment Finance • SBA • Opportunistic Acquisition Strategy • Expe

  42. Slide 42: Favorable Trading Price

    42 Favorable Trading Price From Compass Point Research and Trading, LLC —Seeking Value, Top 10 Conversion Picks Near Book, July 10, 2017 Top Ten Conversion Picks, $1-10B in Assets Ticker Name State Market Cap (M) 7/7/17 Price Conversion Type Conversion IPO Date Shares (M) Assets P/TBV Consensus 2018

  43. Slide 43: Investor Contacts

    Investor Contacts Dana Stonestreet Chairman, President and CEO dana.stonestreet@hometrustbanking.com Hunter Westbrook EVP/Chief Banking Officer hunter.westbrook@hometrustbanking.com Tony VunCannon EVP/Chief Financial Officer/Treasurer tony.vuncannon@hometrustbanking.com 10 Woodfin Street Asheville,

  44. Slide 44: Non-GAAP Disclosure Appendix

    44 Non-GAAP Disclosure Appendix

  45. Slide 45: Non-GAAP Disclosure

    In addition to results presented in accordance with generally accepted accounting principles utilized in the United States ("GAAP"), this presentation contains certain non-GAAP financial measures, which include: tangible book value per share, net income excluding merger-related expenses, nonrecurrin

  46. Slide 46: Non-GAAP Disclosure Reconciliation

    46 Non-GAAP Disclosure Reconciliation Set forth below is a reconciliation to GAAP of tangible book value and tangible book value per share:

  47. Slide 47: Non-GAAP Disclosure Reconciliation

    47 Non-GAAP Disclosure Reconciliation Set forth below is a reconciliation to GAAP net interest income and net interest margin as adjusted to exclude additional FHLB borrowings and proceeds from such borrowings:

  48. Slide 48: Non-GAAP Disclosure Reconciliation

    48 Non-GAAP Disclosure Reconciliation Set forth below is a reconciliation to GAAP net income, ROA, and EPS as adjusted to exclude merger-related expenses, nonrecurring state tax expense, gain on sale of premises and equipment, and impairment charge for branch consolidation:

  49. Slide 49: Non-GAAP Disclosure Reconciliation

    49 Non-GAAP Disclosure Reconciliation Set forth below is a reconciliation to GAAP net income and EPS as adjusted to exclude merger-related expenses, nonrecurring state tax expense, gain on sale of premises and equipment, loan loss provision (recovery), and impairment charge for branch consolidation:

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