Acnb Corporation · NASDAQ:ACNB
Acnb — Q1 2023 Earnings Presentation
27 slides from Acnb's earnings presentation, May 31, 2023
Slide 1: ACNB Corporation Investor Presentation First Quarter of 2023
A C N B C O R P O R A T I O N Investor Presentation First Quarter of 2023 Nasdaq: ACNB investor.acnb.com
Slide 2: Important Information
2 | Investor Presentation Important Information • ACNB Corporation (Nasdaq: ACNB) (“ACNB” or the “Corporation”) is the financial holding company for ACNB Bank (“ACNB Bank” or the “Bank”) and ACNB Insurance Services, Inc. (“ACNB Insurance Services,” “ACNB Insurance” or “Insurance Services”). • This p
Slide 3: Corporate Profile
3 | Investor Presentation Corporate Profile Mid-Atlantic commercial bank holding company for ACNB Bank and ACNB Insurance Services, which serve businesses and communities in Pennsylvania and Maryland, including those in the Gettysburg region, its surrounding counties, and the Greater Baltimore area.
Slide 4: Investment highlights
4 | Investor Presentation Experienced Management Team • Proven management team with many years of experience; Chief Financial Officer, Chief Strategy Officer and Maryland Market President relatively new to the executive team bringing additional outside experience and depth from larger banks Commerci
Slide 5: Experienced Management Team
5 | Investor Presentation Experienced Management Team James P. Helt President & Chief Executive Officer Named Corporation CEO in 2017 and Bank President in 2015. Joined ACNB in 2008 after serving as a senior executive with Susquehanna Bank and CommunityBanks. 34 years In financial services 15 years
Slide 6: Commercially Focused Loan Portfolio
6 | Investor Presentation 70% Commercial† Commercially Focused Loan Portfolio • 193.43% CRE loans/total RBC* • 31.97% construction loans/total RBC* • 43.43% owner-occupied/total CRE • 5.03% average yield on commercial loans** • Long-term growth opportunities o LPOs in Hunt Valley, MD, Lancaster and
Slide 7: Stable and Low-Cost Deposit Base
7 | Investor Presentation Stable and Low-Cost Deposit Base • 10.4% of deposits associated with top 20 relationships • 80.8% of all deposits FDIC insured and/or collateralized o Average deposit account balance <$25,000 at MRQ end • ~62.0% deposit share in Adams County and strong market presence in su
Slide 8: Low Historic Betas
8 | Investor Presentation Low Historic Betas Beta calculated as the basis-points change in average cost of deposits for the quarter divided by the basis points change in average effective funds rate for the same period; Median peer data from S&P Capital IQ Pro and EFFR from St. Louis Fed (fred.stlou
Slide 9: Commitment to Noninterest Income to Diversify Revenue
9 | Investor Presentation Commitment to Noninterest Income to Diversify Revenue • Year-over-year increase driven primarily by commissions from insurance sales of $702,000 due to the acquisition of the business and assets of the Hockley & O’Donnell Insurance Agency in combination with higher continge
Slide 10: Fee-Generating Offerings
10 | Investor Presentation Fee-Generating Offerings All dollar amounts in thousands * Income from fiduciary, investment management and brokerage activities ** Non-GAAP financial measure ; Refer to the calculation on the pages titled “Reconciliation of Non-GAAP Measures” at the end of this presentati
Slide 11: Focus on Expense Management
11 | Investor Presentation Focus on Expense Management * Non-GAAP financial measure ; Refer to the calculation on the pages titled “Reconciliation of Non-GAAP Measures” at the end of this presentation $000s 1Q23 4Q22 1Q22 Salaries and employee benefits $10,442 $9,786 $7,559 Net occupancy $1,037 $978
Slide 12: Branch Network Productivity
12 | Investor Presentation Branch Network Productivity • ~21% reduction in net branch count since the end of 2020 to 26 locations o Consolidated eight full-service locations since the end of 2020, including six in 2022 • Opened one new full-service location in 2022 o New floorplan designed to suppor
Slide 13: Strong Profitability
13 | Investor Presentation Strong Profitability • Delivering strong profitability for shareholders * Non-GAAP financial measure ; Refer to the calculation on the pages titled “Reconciliation of Non-GAAP Measures” at the end of this presentation R O A A R O A E R O A TC E EP S 0.97% 1.26% 1.51% 1.56%
Slide 14: Actively Managing Strong Capital Position
14 | Investor Presentation Actively Managing Strong Capital Position • Practices reflect ACNB’s ongoing and long-term commitment to maximizing shareholder value o Repurchased 206,929 common shares in 2022 o Increased dividend by $0.02 to $0.28 in 4Q22 • Disciplined acquisition strategy o Compatible
Slide 15: Prudent Asset-Liability Management
15 | Investor Presentation Prudent Asset-Liability Management MRQ End4Q21 End • Repositioned balance sheet in 2022 to reduce interest rate risk o Reduced cash/ cash equivalents as a percentage of total assets from 25.5% at the end of 2021 to 4.7% at MRQ end Rate Ramp Scenario Rate Shock Scenario Mod
Slide 16: Ample Liquidity Position
16 | Investor Presentation Ample Liquidity Position • Actively monitoring, managing and projecting our liquidity needs to minimize our liquidity risk o Liquidity monitored daily • Stable, durable and relationship-based core deposits continue to be ACNB Bank’s primary source of liquidity o 74.5% loan
Slide 17: Stable Asset Quality
17 | Investor Presentation Stable Asset Quality • Committed to sound credit risk management, including conservative and disciplined underwriting practices, timely credit administration process and proactive customer relationship management All dollar amounts in thousands; non-performing loans consis
Slide 18: CECL Adoption
18 | Investor Presentation CECL Adoption • Transitioned from the incurred loss accounting method to the current expected credit loss model on 1/1/23 in accordance with Topic 326 for smaller reporting companies under SEC rules Incurred Model Allowance CECL Model Allowance • Recorded a net decrease to
Slide 19: Appendix
19 | Investor Presentation Appendix
Slide 20: Diversified Loan Portfolio
20 | Investor Presentation 11% 53% 6% 5% 24% 1% 70% Commercial* Diversified Loan Portfolio • Average loan balance ~$152k as of 3/31/23 • Average Commercial* loan balance ~$332k as of 3/31/23 All dollar amounts in thousands and balances at period end, with commercial and industrial (C&I) loan amounts
Slide 21: CRE Breakdown
21 | Investor Presentation CRE Breakdown Apartments 5.12% Hotel/Motel/B&B 10.14% Office Complex 9.37% Rental Units - Retail/Mixed Use/Commercial 14.19% 5.73% Strip Mall 4.61%Warehouse 4.43% Restaurant 3.85% Farming 6.07% Retail 3.05% Manufacturers 4.88% Non-Profit 5.05% Service Industry 7.60% Othe
Slide 22: Reconciliation of Non-GAAP Measures
22 | Investor Presentation This presentation contains financial measures determined by methods other than in accordance with accounting principles generally accepted in the United States (GAAP). The Corporation has presented the following non-GAAP financial measures because it believes that these me
Slide 23: Reconciliation of Non-GAAP Measures
23 | Investor Presentation Reconciliation of Non-GAAP Measures 23 $ in 000's, except per share amounts 3/31/2022 6/30/2022 9/30/2022 12/31/2022 3/31/2023 Common shareholders’ equity (tangible), per share Shareholders’ Equity $256,009 $247,032 $232,370 $245,042 $255,841 Less: Goodwill and intangible
Slide 24: Reconciliation of Non-GAAP Measures
24 | Investor Presentation Reconciliation of Non-GAAP Measures 24 $ in 000's 3/31/2022 6/30/2022 9/30/2022 12/31/2022 3/31/2023 Efficiency Ratio Non-interest expense $13,282 $15,006 $15,320 $16,673 $16,282 Less: Intangible amortization ($309) ($389) ($395) ($399) ($360) Less: Merger related expenses
Slide 25: Reconciliation of Non-GAAP Measures
25 | Investor Presentation Reconciliation of Non-GAAP Measures 25 $ in 000's Twelve Months Ended, 2019 2020 2021 2022 3/31/2023 Noninterest income/revenue Noninterest Income $18,169 $20,090 $22,776 $21,807 $22,332 Less: Gain on life insurance proceeds $0 $0 $101 $0 $0 Less: Net (losses) gains on sal
Slide 26: Peer Companies
26 | Investor Presentation Peer Companies 26 Name Ticker Name Ticker Mid Penn Bancorp, Inc. MPB Fidelity D & D Bancorp, Inc. FDBC The First of Long Island Corporation FLIC Citizens & Northern Corporation CZNC Arrow Financial Corporation AROW Citizens Financial Services, Inc. CZFS BCB Bancorp, Inc. B
Slide 27: ACNB Corporation Investor Relations Contact
27 | Investor Presentation ACNB Corporation Investor Relations Contact Jason H. Weber Executive Vice President, Treasurer & Chief Financial Officer ACNB Corporation 16 Lincoln Square Gettysburg, PA 17325 investor.relations@acnb.com 717-339-5090 Investor Presentation