Peoples Bancorp Inc. · NASDAQ:PEBO
Peoples Bancorp — Q3 2017 Earnings Presentation
21 slides from Peoples Bancorp's earnings presentation, Nov 6, 2017
Slide 1: Investor Presentation 3rd Quarter 2017
Peoples () Investor Presentation 3™4 Quarter 2017 Filed by Peoples Bancorp Inc. Pursuant to Rule 425 under the Securities Act of 1933 and deemed filed pursuant to Rule 14a-12 under the Securities Exchange Act of 1934 Subject Company: ASB Financial Corp. Commission File No. 16772 Safe Harbor Statemen
Slide 2: Additional Information
Additional Information @ This presentation does not constitute an offer to sell, or the solicitation of an offer to buy, securities of Peoples. Peoples will file a registration statement_on Form S-4 and will file other documents regarding the proposed merger with ASB Financial Corp (“ASB”) reference
Slide 3: Profile and Investment Rationale: Corporate Profile
Profile and Investment Rationale Fi Peoples ¢ BANCORP®©X\% Corporate Profile * Financial holding company headquartered in Marietta, Ohio. — Provides a broad range of banking, insurance, and investment services * Current snapshot: — Assets: $3.6 billion; Loans: $2.3 billion — Deposits: $2.7 billion —
Slide 4: Investment Rationale
Investment Rationale @ * Unique community banking model — Greater revenue diversity (32% fee-based) than the average $1 - 10 billion bank — Strong community reputation and active involvement — Local market teams capable of outmaneuvering larger banks — More sophistication and product breadth than sm
Slide 5: ASB Financial Corp Transaction
ASB Financial Corp Transaction a AMERICAN | ASB Financial Corp (OTC Pink: ASBN) SAVINGS SAVINGS $& BANK, fs BANK, fsb Deal announced on October 24, 2017 Six full-service bank branches in the Portsmouth and Cincinnati, Ohio regions, and twoloan Deal Value: $89.6million 158% of TBV production offices
Slide 6: Strategic Road Map
Strategic Road Map “Best Community Bank in America” * Commitmentto Superior Shareholder Returns * Great Place to Work * Great Place to Bank ‘ay ~ * Meaningful Impact on Our Communities Responsible Risk Mamaseene 8. Pricing Discipin Focus on the risk adjusted + Our Wayof Life * Broad DeliveryChannels
Slide 7: Strategic Targets
Strategic Targets YID YID _5-Year Strategic Status as of Metrics 9/30/16 9/30/17 __TargetRange* __9/30/17 NPAs as a percent of total loans and OREO (1) 111% 086% 0.70% to 1.00% 7 Net charge-offs as a percent of average total loans (2) 0.14% 0.16% 0.30% to 0.50% 4 Improve Asset Quality Loans to total
Slide 8: Peoples Market Insight
Peoples Market Insight * Strongest deposit market share positions in more rural markets where we can affect pricing * Presence near larger cities puts us in position to capture lending opportunities in more urban markets (e.g. Cleveland, Akron, Canton, Cincinnati and Columbus) ‘Total Deposits in MSA
Slide 9: Third Quarter 2017 Highlights
Third Quarter 2017 Highlights (ay Reported record third quarter earnings of $10.9 million Grew loans by 7%, compared to September 30, 2016, with strong performance in both indirect and commercial & industrial lending Efficiency ratio below 61% via expense control Improved credit quality with credit
Slide 10: Core Non-Interest Expense
Core Non-Interest Expense * Seven consecutive quarters of well-controlled expenses $27,000 $25,000 $23,000 $21,000 (thousands) Not to seale $19,000 $17,000 $15,000 fl f fl f fl i QL16 Q216 Q3-16 Q416 QLl7 Q217 Q3-17 * Non-GAAP financal measure. See Appendix. Operating Leverage Operating leverage is
Slide 11: Core Efficiency Ratio
Core Efficiency Ratio 66.00% 64.85% 64.83% 64.89% 65.0 re 64.26% 64.0 o* 63.28% 63.009 62.00% 61.19% 8% Improvement from FY 2015 to YTD 2017 61.00% 5% from Q1 2016 to 60.00% QL-16 Q216 Q316 Qtl6 QlL-17 Q217 Q317 Q82017 FY-15 F¥-16 9 9=YTD-17 + The Core Efficiency Ratio is a non-GAAP financial measur
Slide 12: Asset Quality
Asset Quality $50,000 $45,000 $40,000 $35,000 $30,000 $25,000 $20,000 $15,000 $10,000 $5,000 Criticized and Classified loan levels remain reasonably stable 45.0% 39.2% ar 400% 33.3%. 32.3% | 35.0% 30.4% 29.9% 30.1% 30.0% | 25.0% | 19:3% 4g. ee 16.5% 14% 16.8% 45 pon 20.0% Qt15 QLI6 Q216 Q316 Qtl6 Ql
Slide 13: Total Loan Growth
Total Loan Growth a Total loans were up 7% over September 30, 2016 $2,350 $2,300 $2,250 $2,200 $2,327 $2,150 $2,100 $2,169 $2,050 Q3-16 | Q217 Q3-17 ($millions) Not to scale $2,000 Q416 QLi7 Total deposits were up 3% over September 30, 2016 Demand deposit accounts (DDAs) represented 42% of total dep
Slide 14: Earning Asset Mix; Prudent Use of Capital
Earning Asset Mix ‘ay Since 2018, the percentage of earning assets composed of investments has decreased, while the percentage composed of loans has increased. (tmillions) FY15 FY-14 FY15 FY-16 YTD-17 Investments ® Loans 7} Peoples () BANCORP 27 Prudent Use of Capital ‘ay ¢ Dividends — Cash dividend
Slide 15: CRE Concentration Analysis
CRE Concentration Analysis ‘ay * CRE exposure is well below supervisory criteria established to identify institutions with heightened CRE concentration risk — Exposure levels also compare favorably to peer institution concentration levels — Concentration levels have improved relative to peers on a l
Slide 16: Business Highlights
Business Highlights ‘ay ¢ Commercial Banking — Average loans up 7% and average deposits up 4% from December 2016 — $20 million lending “house limit” although legal limitis over $40 million * Retail Banking — Indirect loans grew by $106 million, or 46%, since September 30, 2016 — Non-interest bearing
Slide 17: Appendix
Appendix ‘Peoples @) BANCORP Pre-provision net revenue (PPNR) has become a key financial measure used by state and federal bank regulatory agencies when assessing the capital adequacy of financial institutions. Pre-provision net revenue is defined as net interest income plus total fee-based income m
Slide 18: Non-GAAP Measures: Efficiency Ratio
Non-GAAP Measures EFFICIENCY RATIO The efficiency ratio is a key financial measure used to monitor performance. The efficiency ratio is calculated as total non-interest expense (less amortization of other intangible assets) as a percentage of fully tax-equivalent net interest income plus fee-based i
Slide 19: Non-GAAP Measures: Core Non-Interest Expense
Non-GAAP Measures CORE NOD TEREST EXPENSE Core non-interest expense is a financial measure used to evaluate Peoples’ recurring expense stream. This measure is non-GAAP since it excludes the impact of system upgrade costs, acquisition-related costs, pension settlement charges, severance charges, sear
Slide 20: Non-GAAP Measures: Tangible Equity Ratios
Non-GAAP Measures TANGIBLE EQUITY RATIOS Peoples uses tangible capital measures to evaluate the adequacy of Peoples’ stockholders’ equity. Such ratios represent non- GAAP financial measures since the calculation removes the impact of goodwill and other intangible assets acquired through acquisitions
Slide 21: Non-GAAP Measures: Return on Average Tangible Equity
Non-GAAP Measures RETUR? AVERAGE TANGIBLE STOCKHOLDERS’ EQUITY The return on average tangible stockholders’ equity ratio is a key financial measure used to monitor performance. It is calculated as net income (less after-tax impact of amortization of other intangible assets) divided by average tangib