Bankwell Financial Group, Inc. · NASDAQ:BWFG
Bankwell Financial — Q3 2018 Earnings Presentation
22 slides from Bankwell Financial's earnings presentation, Nov 9, 2018
Slide 1: Bankwell Financial Group 3Q'18 Investor Presentation
Bankwell Financial Group3Q’18 Investor Presentation
Slide 2: Safe Harbor
Safe Harbor This presentation may contain certain forward-looking statements about the Company. Forward-looking statements include statements regarding anticipated future events and can be identified by the fact that they do not relate strictly to historical or current facts. They often include word
Slide 3: Bankwell's Story and Milestones
Bankwell MILESTONESAssets Bankwell’s Story Bankwell is one of the fastest growing and most profitable community banks in Connecticut. Bankwell was named one of the “Top 100 Best Performing Community Banks of 2016” between $1 billion and $10 billion in assets nationwide based on certain metrics for t
Slide 4: Bankwell Profile
Bankwell Profile $1.89B asset Connecticut-based bank with focus on CRE and C&I lending12 existing branches in Fairfield & New Haven Counties Company Overview NASDAQ: BWFG $162MM deposits per branch, excluding the 3 new branches opened in 2Q; highest in Fairfield & New Haven Counties1Attractive core
Slide 5: Why Bankwell?
Why Bankwell? Consistently strong performer in highly attractive markets 1 as of September 28th, 20182 as of September 30th, 2018
Slide 6: Strategic Priorities
Strategic Priorities Balance Sheet Diversification/ Loan Growth Deposit Growth Credit Quality Capital Management Strategic expansion of C&I lendingPrice “smart”, defend NIM through disciplined growth Maintain disciplineExpand portfolio management capabilities Opened three new branchesLaunched online
Slide 7: 3Q'18 Highlights
3Q’18 Highlights Profitability Growth Stability $4.9 million Net Income1.03% Return on Average Assets 11.23% Return on Average Equity$22.20 Tangible Book Value $1.6 billion of gross loans, 5% growth year over year$1.5 billion of deposits, 6% growth year over year3 new branches grew to $24MM in depos
Slide 8: 3Q Consolidated Statement of Income
3Q Consolidated Statement of Income 2018 2017 V 1Total Interest Income $20.5 $18.3 $2.2Total Interest Expense $6.3 $4.5 $1.8Net Interest Income $14.2 $13.9 $0.4Provision for Loan Losses $0.3 $0.4 $(0.1)Net Interest Income after Provision $13.9 $13.5 $0.5Non Interest Income $0.9 $0.8 $0.0Non Interest
Slide 9: 3Q YTD Consolidated Statement of Income
3Q YTD Consolidated Statement of Income 2018 2017 V 1Total Interest Income $58.5 $52.5 $6.0Total Interest Expense $16.7 $12.0 $4.6Net Interest Income $41.9 $40.5 $1.4Provision for Loan Losses $0.6 $1.8 $(1.2)Net Interest Income after Provision $41.2 $38.6 $2.6Non Interest Income $3.3 $3.1 $0.2Non In
Slide 10: Financial Snapshot
Financial Snapshot Dollars in thousands, except per share data 2014 2015 2016 2017 1Q’18 2Q’18 3Q’18 Total assets $1,099,531 $1,330,372 $1,628,919 $1,796,607 $1,831,243 $1,870,802 $1,885,036 Net loans $915,981 $1,129,748 $1,343,895 $1,520,879 $1,534,565 $1,572,591 $1,585,465 Loans to deposits 110.7%
Slide 11: Financial Performance Trends
Financial Performance Trends Net IncomeCAGR 38% RevenueCAGR 15% 1 4Q’17 EPS reduced by $0.26 due to the impact of the Tax Cut and Jobs Act passed in December 2017 along with several other smaller items; on a “core” basis, 2017 EPS is $2.03, please refer to BWFG’s 4Q’17 Earnings Release for further d
Slide 12: Loan Portfolio
Loan Portfolio CAGR 16% $1,543 $1,366 $1,148 $930 Dollars in millions $1,608 ‘18 driven by strong originations offset by prepayments
Slide 13: Loan Volume Trends
Loan Volume Trends Dollars in millions Loan Volume YTD results reflect pricing discipline during Q1, a period of disproportionate competitionOrigination volume subsequently normalized at appropriate credit spreadsAnticipate full year originations of ~$300MM
Slide 14: Loan Pricing Trends
Loan Pricing Trends Total Loan Portfolio 1 As of 11-8-182 Weighted average yield based on active loans as of 12-31-17 & 9-30-18, respectively 2 Dollars in millions Loan statistics 3Q YTD Weighted average yield on new loan fundings 5.48% 5.30% Weighted average life on new loans ~4.0 Yrs ~4.5 Yrs Aver
Slide 15: Loan Portfolio
Loan Portfolio Team of skilled credit analysts, most with > 10 years’ experienceStrong risk management practices in placeDeveloped rigorous suite of risk management reports, enabling multi-level portfolio stratificationProven track record as CRE LenderC&I concentration grew from 15.1% in year-end 20
Slide 16: CRE Loan Portfolio
CRE Loan Portfolio Retail Composition $ % Retail2 $168 55.30% Grocery $76 25.00% Pharmacy $27 9.03% Restaurant $17 5.50% Gas / Auto Services $16 5.16% Total Retail $303 100.00% Average deal size is $2.1MM Office Composition $ % Office (primarily suburban) $207 71.62% Medical $80 27.67% Condo $2 0.70
Slide 17: Geography Distribution
Geography Distribution Measured approach to expansionFollowing existing customers to new locationsImproved geographic diversification since year-end 2017 CRE to Risk Based Capital Ratio Proven track record as CRE LenderStrong risk management practices in place 1 1 Includes Owner Occupied CRE CRE Loa
Slide 18: Asset Quality
Asset Quality NPAs $4.31 $5.04 $3.21 $5.48 $20.86 $23.33 $21.96 $MMs NPAs to Total Assets Update on the 2 recent NPAsNPA #1 $4MM loan fully paid off in 3Q’18; BWFG recovered 100% principal plus default interest and expenses.NPA #2 Continuing to work with borrower on multiple pathways to repayment; $
Slide 19: Deposits
Deposits CAGR 17% $835 $1,047 $1,289 $1,398 Dollars in millions $1,493 BWFG increasing deposits in a competitive market
Slide 20: Deposit Market Share
Deposit Market Share Deposit Market Share Location 2013 2014 2015 2016 2017 2018 New Canaan 19.77% 22.71% 24.40% 29.59% 31.10% 32.44% Wilton 6.26% 6.87% 7.76% 9.85% 13.81% 15.18% Fairfield 5.95% 7.65% 6.38% 7.58% 9.18% 9.14% Norwalk not applicable 1.44% 1.97% 2.92% 3.62% Stamford 1.99% 2.84% 2.00% 1
Slide 21: Management Team
Management Team Name Years Experience Selected Professional Biography Christopher GrusekePresident & CEO(since 2015) 25+ Founding investor of Bankwell’s precursor, Bank of New Canaan, member of BoD and ALCO Committee 2009 to 201220 year Investment Banking career focused on financial institutions, se
Slide 22: Thank You & Questions
Ke Thank You & Questions
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