Connectone Bancorp, Inc. · NASDAQ:CNOB
Connectone Bancorp — Keefe, Bruyette & Woods Community Bank Investor Conference 2015
29 slides from Connectone Bancorp's conference presentation, Jul 28, 2015
Slide 1: ConnectOne Bancorp, Inc. KBW Community Bank Investor Conference
& ConnectOne Bancorp, Inc. Keefe, Bruyette & Woods Community Bank Investor Conference July 28" - 29%, 2015 New York, NY
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements. Any statements about our expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward-looking. These statements are often, bu
Slide 3: Holding company for ConnectOne Bank
* Holding company for ConnectOne Bank “+ Approximately $3.7 billion in total assets, $2.8 billion in total loans and $2.6 billion in total deposits New York City “+ 24 locations across Manhattan, Bergen, Essex, Hudson, Mercer, Monmouth, Morris and Union counties “+ One of the largest New Jersey-base
Slide 4: Densely populated, high-growth market
Densely populated, high-growth market $1.5 trillion of the nation’s $16 trillion GDP Represents a natural extension of our existing client base Market is largely dominated by the largest institutions in the country, leaving tremendous opportunity for banks catering to middle market business Already
Slide 5: Strong Corporate Culture
Strong Corporate Culture Sense of Urgency culture is a game-changer for clients * Speed ofexecutionin underwriting and closing process “Ability to get answers to clients quickly Sense of Urgency Connected Team * No Silos — Everyone works for the Company * Self-fulfilling prophecy: Loan originators w
Slide 6: Core Diluted EPS
Core Diluted EPS* $0.32 : Q2 2014 Q3 2014 Q4 2014 Pre-Merger Excludes non-recurring items. See appendix for a reconciliation of GAAP and non-GAAP measures. CIEE Qi 2015 26% Increase from prior year quarter $0.34 Q2 2015 & ConnectOne Bancorp
Slide 7: Tangible Book Value per Share
t.) rends ( Tangible Book Value per Share 10% Increase from prior year i $10.02 $9.15 $9.40 $9.57 $9.86 Q2 2014 03 2014 esa0id a | = Pre-Merger ‘See appendix for areconciliation of GAAP and non-GAAP measures. Cee & ConnectOne Bancorp
Slide 8: Total Loans Solid Organic Growth
t.) rends ( Total Loans Solid Organic Growth ($ Millions) ay $2,765 $2,427 $2839 — $1,006 Q2 2014 03 2014 Q4 2014 Q1 2015 Q2 2015 Pre-Merger & ConnectOne Bancorp
Slide 9: Total Deposits
rends ( Total Deposits ($ Millions) $2,469 $2,476 $2,496 $2,569 ] : | . Q2 2014 Q3 2014 Q4 2014 Qi 2015 Q2 2015 Pre-Merger ee & ConnectOne Bancorp
Slide 10: Noninterest-bearing Deposits
Noninterest-bearing Deposits $238 Q2 2014 Pre-Merger ($ Millions) $471 Q3 2014 $493 Q4 2014 Focus on core relationship deposits $553 $480 iil Qi 2015 Q2 2015 & ConnectOne Bancorp
Slide 11: Net Interest Margin
Net Interest Margin* 3.50% 3.46% 3.45% 3.43% cx 3.40% 3.30% 2206 a2 3.20% a2 2014 Q3 2014 Qa 2014 Qi 2015 Q2 2015 Pre-Merger — = — Peer Median 1) ‘Excludes purchase accounting. Seeappendixfor a reconciliation of GAAP and non-GAAP measures. 1) Peer group includes banks and thrifts between $1.08 and $
Slide 12: Operating Efficiency Ratio
Operating Efficiency Ratio* 75.0% 70.0% 5.0% ee ee ee ee eee eee 60.0% 55.0% al 44.8% 45.0% 45.0% 42.0% 42.0% 40.0% 38.4% 35.0% 30.0% 25.0% Q2 2014 Q3 2014 a4 2014 a1 2015 Q2 2015 Pre-Merger — — — Peer Median 1) *€xcludesnon-recurring items. See appendix fora reconciliation of GAAP and non-GAAP meas
Slide 13: Core Return on Average Tangible Assets
Core Return on Average Tangible Assets* 1.60% 1.20% 1.22% 1.20% 1.20% 1.10% 1.07% in = om Ss Yes ls —=- _ 0.40% 0.00% Q2 2014 Q3 2014 a4 2014 Qi 2015 Q2 2015 Pre-Merger = = — Peer Median 1) Excludes non-recurring items. See appendix fora reconciliation of GAAP and non-GAAP measures. 1) Peer group in
Slide 14: Core Return on Average Tangible Common Equity
rends (cont.) Core Return on Average Tangible Common Equity* 16.00% 13.47% 13.75% 13.47% 12.04% 12.15% 12.00% 8.00% 4.00% 0.00% 22014 3.2014 Q42014 Q12015 Q22015 Pre-Merger — = — Peer Median 1) Excludes non-recurring items. See appendix fora reconciliation of GAAP and non-GAAP measures. 1) Peer grou
Slide 15: Capital Ratios
Capital Ratios Reflects issuance of $50mm in Subordinated Debt 12.3% 11.1% 10.9% rr 8.7% 8.6% Q3 2014 Q4 2014 Qi 2015 Q2 2015 @ Tangible Common Equity Ratio @ Risk-Based Total Capital Ratio ——— & ConnectOne Bancorp
Slide 16: Interest Rate Risk
te R Interest * We manage our interest rate risk to a slightly asset sensitive position * Balance sheet structure decreases uncertainty and minimizes interest rate risk * Very low residential mortgage exposure, reduces extension risk * Focus on non-interest bearing demand * Laddered wholesale fundin
Slide 17: Commitment to Solid Credit
Commitment to Solid Cri * Comprehensive underwriting standards and processes * Maintain LTV and DSC standards + Loan origination process supported by specialized teams of credit analysts * We stick to what we do best * High quality direct commercial lending + No reliance on participations or wholesa
Slide 18: Commitment to Solid Credit: Non-Performing Assets & Charge-Offs
Commitment to Solid Credit Non-Performing Assets & Charge-Offs 1.40% 1.20% 1.00% 0.80% 0.60% 0.37% pe 0.37% 0.40% pike = 0.26% opaie 0.20% al 0.04% | oe 07% 0.01% -% 0.00% — : - Q2 2014 Q3 2014 04 2014 Qt 2015 Q2 2015 Pre-Merger NPA Ratio @NetC/O Ratio — —= == Peer Median 1) 1) Peer group includes b
Slide 19: Loan Composition
an Composit Total Loans- $2.8 Billion Residential and Consumer 8% . C&1 20% Construction 8% y CRE-Owner Occupied 9% CRE-Multifamily 28% CRE-Non-Owner Occupied 27% —EEEEES _ & Connectone
Slide 20: Deposit Composition
it Composition Total Deposits- $2.6 Billion Brokered 9% Noninterest Demand 22% Listing 4% e Time 17% Reciprocal 10% Interest Transaction 38% ee & ConnectOne Bancorp
Slide 21: Growth Strategy: Organic Growth, Acquisition, Franchise Value
1. Organic Growth * Loan growth rates well in excess of market averages * Efficient operating structure, with potential to further leverage “+ Untapped sources of revenue 2. Expansion through Opportunistic Acquisition * Skilled acquiror * Attractive currency relative to smaller in-market participant
Slide 22: A Compelling Investment Opportunity
Slide 23: , Inc.
& ConnectOne Bancorp, Inc. & ConnectOne Bancorp
Slide 24: Appendix
& ConnectOne Bancorp, Inc. APPENDIX & ConnectOne Bancorp
Slide 25: Reconciliation of measures
Reconciliation of GAAP and non-GAAP measures ‘Three Months Ended (dollars in thousands, except share data) Earnings, EPS and Operating D: Net income (GAAP) Less: preferred dividends Net income available to common stockholders (GAAP) Net gains on sales of securites Partial settlements of pension obli
Slide 26: Reconciliation of measures (cont)
Reconciliation of GAAP and non-GAAP measures (cont) ‘Three Months Ended (dollars in thousands, except share data) vune 30, March31, —Dec.31, Sept. 30, Junea0, 2015 2015 2014 2014 2014 ‘Retum on Equity Measures Core earnings available to common stoc kholders S_10153 S$ 997 _S_9714 S869 $4450 ‘Average
Slide 27: Reconciliation of measures (cont)
Reconciliation of GAAP and non-GAAP measures (cont) Three Months Ended (dollars in thousands, except share data) June30,— March31, Dee. 31, Sept. 30, Tune 30, (if Tacy Slee ures 2018 2015, 2014 2014 2014 Total noninterest expenses S$ 14974 $ 12631 $ 15.166 $ 25400 $§ 6,744 Partial settlements of pen
Slide 28: Reconciliation of measures (cont)
Reconciliation of GAAP and non-GAAP measures (cont) (dollars in thousands, except share data) Ratios Common equity Less: intangible assets Tangible common equity Book Value per Share Total assets Less: intangible assets Tangible assets, Common shares outstanding Common equity ratio (GAAP) Tangible c
Slide 29: Reconciliation of measures (cont)
Reconciliation of GAAP and non-GAAP measures (cont) As of. (dollars in thousands, except share data) June 30, March31, Dec. 31, Sept.30, June30, 2015 2015 2014 2014 2014 Asset Nonacerual loans S$ 12145 S$ 14685 S 11610 S 6083 $ 4092 (Other real estate owned 1.564 870 1.108 4.442 220 Total nonperform
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