Sb Financial Group, Inc. · NASDAQ:SBFG
Sb Financial — SMID-West Conference 2013
24 slides from Sb Financial's conference presentation, December 2013
Slide 1: Vision: Become a top quartile independent financial services company
Vision: Become a top quartile independent financial services company serving northwestern Ohio and linked markets SMID-West Conference, Chicago, December 2013
Slide 2: Safe Harbor Statement
Safe Harbor Statement Certain statements within this document, which are not statements of historical fact, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties and actual results
Slide 3: Vision: Become a Top Quartile Independent Financial Services Company
Vision: Become a Top Quartile Independent Financial Services Company • Strategy and team in • NASDAQ: SBFG place to drive: – $633 million in assets – ROAA expansion – $39 million market cap • 4.87 million shares – Further diversification of outstanding revenue stream – Growth within existing Serving
Slide 4: What is "Top Quartile" Performance
What is “Top Quartile” Performance SBFG YTD Peer Group Peer Group 9/30/13 Top Quartile* Median* SBFG 2012 SBFG 2011 Return On Assets 0.83 0.94 0.74 0.75 0.26 Net Interest Margin 3.81 3.90 3.59 3.76 3.81 Non-interest Income/Avg. Assets 2.33 1.12 0.78 2.30 1.83 Efficiency Ratio 72.73 66.07 71.15 74.41
Slide 5: SBFG's Foundation
SBFG’s Foundation • Based in Defiance, Ohio • Operating through: – 17 banking centers in seven Ohio counties – One banking center in Indiana – Three loan production offices: two in Columbus, Ohio, and one in Angola, Indiana • Offering a full range of financial services for consumers and small busine
Slide 6: Distinguishing SBFG
Distinguishing SBFG • Providing consistent first-class customer experiences • Broader product offering than typical bank with less than $1 billion in assets • High-level business leaders: – On the ground in our large markets – “Owning” their business (not product-driven, but customer-driven) 6
Slide 7: SBFG's Strategic Path
SBFG’s Strategic Path • Strengthen penetration in all markets served – Low market share in higher growth markets • Expand product service utilization by new and existing customers – Household share of wallet • Increase profitability through ongoing diversification of revenue streams – Fee income a s
Slide 8: Serving Northwestern Ohio and Linked Markets
Serving Northwestern Ohio and Linked Markets • Northwestern Ohio markets recovering from economic downturn • Median home price in Ohio in Q2 2013 was $113,730 vs. U.S. median of $180,176 • Market share • Rural – high • Urban – low • Low-cost rural deposit base offers advantage in urban market lendin
Slide 9: Strengthen Penetration in Markets Served
Strengthen Penetration in Markets Served • Columbus – Retail expansion process progressing – Significant number of mortgage households with limited relationships • Toledo – Fully staffed with commercial lending, wealth management and retail locations • Defiance – Enhance and maintain our high deposi
Slide 10: Expand Product Service Utilization by New and Existing Customers
Expand Product Service Utilization by New and Existing Customers • 32% of our households use three or more services • 87% of our staff has made a referral to another business line • Branded credit card product premiered May 2013 • Relationship rewards depository products to premier in Q1 2014 10
Slide 11: Increase Profitability Through Ongoing Diversification
Increase Profitability Through Ongoing Diversification • Fee income as a 2012 Fee Income percentage of total $14.9 million revenue exceeds 40% Other 5.3% • Significant capacity exists Item Processing to expand relationships 16.9% Mortgage Banking with little additional cost Wealth 43.2% Management •
Slide 12: Achieve Operational Excellence
Achieve Operational Excellence • Top-line growth to drive upside in above- peer group efficiency ratio • Potential to refinance high-cost Trust Preferred debt • Management committed to consumer technology – Mobiliti® app – Remote Deposit Capture 12
Slide 13: Sustain Asset Quality
Sustain Asset Quality • SBFG’s asset quality NPAs / Assets now solidly top 3.50 3.03 quartile 3.00 2.68 2.77 – Loan loss provision 2.50 2.28 Percentage has outpaced 2.07 2.00 charge-offs for the 1.60 1.50 1.40 1.38 last eight quarters • Three relationships 1.00 comprise 42% of 0.50 total non-perform
Slide 14: Diverse Balance Sheet
Diverse Balance Sheet Portfolio Balance 9/30/13 $475.2 million • Diversification of balance sheet an important risk mitigator Consumer 10.1% Commercial • SBFG reliance on 17.2% commercial real estate Residential Real Estate below median peer 20.3% level of 47.5% Commercial Agriculture Real Estate 8.
Slide 15: Business Strategy Offers Additional Advantages
Business Strategy Offers Additional Advantages ROAA 1.20 • Management/Board committed to growth 1.00 0.94 0.97 0.94 through acquisition 0.80 0.72 0.74 • Dividends reinstated in 0.70 Percentage 0.57 0.83 2013; continuous 0.60 0.75 0.45 payout a management 0.40 priority 0.20 0.26 • Retained earnings *
Slide 16: Strategy and Team Poised for Performance
Strategy and Team Poised for Performance • Become a top quartile independent financial services company – ROAA expansion – Further diversification of revenue stream – Growth within existing markets – Further improvement in asset quality 16
Slide 17: Appendix
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Slide 18: Balance Sheet
Balance Sheet 2013 FQ3 2012 FY 2011 FY 2010 FY 2009 FY 2008 FY YTD Balance Sheet ($000) Total Assets 633,412 638,234 628,664 660,288 673,049 657,619 Total Net Loans 470,520 462,725 441,263 429,884 462,385 448,916 Total Deposits 521,543 527,001 518,765 515,678 491,242 484,221 Total Equity 55,537 53,2
Slide 19: Profitability (%)
Profitability (%) 2013 FQ3 2012 FY 2011 FY 2010 FY 2009 FY 2008 FY YTD Net Income ($000) 3,981 4,814 1,664 (15,613) 382 5,217 ROAA 0.83 0.75 0.26 (2.32) 0.06 0.91 Peer Group ROAA* 0.74 0.70 0.57 0.45 0.20 0.37 ROAE 9.78 9.57 3.54 (27.26) 0.60 8.70 ROATCE 15.52 16.28 8.74 (25.98) 2.88 15.89 Net Inter
Slide 20: Asset Quality (%)
Asset Quality (%) 2013 FQ3 2012 FY 2011 FY 2010 FY 2009 FY 2008 FY YTD NPAs/Assets 1.38 1.40 1.60 2.26 3.27 1.02 Peer Group NPAs/Assets* 2.28 2.77 2.68 3.03 2.67 1.37 NPA Excluding Restructured/Assets 1.11 1.20 1.39 2.09 3.02 1.00 NPAs & 90+ PD/Assets 1.38 1.40 1.60 2.26 3.27 1.02 NPAs/Loans & REO 1
Slide 21: Per Share Information ($)
Per Share Information ($) 2013 FQ3 2012 FY 2011 FY 2010 FY 2009 FY 2008 FY YTD Common Shares Outstanding (actual) 4,869,000 4,861,779 4,861,779 4,861,779 4,861,779 4,881,452 Avg Diluted Shares (actual) 4,877,000 4,861,779 4,861,779 4,861,779 4,870,403 4,925,694 Reported: Book Value 11.41 10.96 9.86
Slide 22: Experienced Management Team
Experienced Management Team Mark Klein – President and CEO Mark A. Klein joined The State Bank and Trust Company on January 3, 2006, bringing with him nearly thirty years of banking industry experience. Under his leadership, State Bank has produced a management team of highly-motivated professionals
Slide 23: Experienced Management Team
Experienced Management Team Anthony Cosentino – EVP and CFO Anthony V. Cosentino has served as Executive Vice President of SB Financial Group, Inc. since March 2010. Mr. Cosentino is a 1983 graduate of Miami University in Oxford, Ohio with a Bachelor of Science Degree in Accounting, and received his
Slide 24: Mark Klein and Anthony Cosentino contact details
Mark Klein – President and CEO Mark.Klein@yourstatebank.com Anthony Cosentino – EVP and CFO Tony.Cosentino@yourstatebank.com 24