Independent Bank Corporation · NASDAQ:IBCP
Independent Bank — Q1 2016 Earnings Presentation
21 slides from Independent Bank's earnings presentation, Apr 25, 2016
Slide 1: Independent Bank Corporation 1st Quarter 2016
\ Independent Bank Corporation INDEPENDENT 1* Quarter 2016
Slide 2: Cautionary Note Regarding Forward-Looking Statements
2 Cautionary Note Regarding Forward-Looking Statements This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements of goals, intentions, and expectations as to future trends, plans, events, or results of Indep
Slide 3: Agenda
3 Agenda Formal Remarks.William B. (Brad) Kessel, President and Chief Executive OfficerRobert N. Shuster, Executive Vice President and Chief Financial OfficerQuestion and Answer session.Closing Remarks.Note: This presentation is available at www.IndependentBank.com in the Investor Relations area und
Slide 4: Financial Summary
4 Financial Summary 1Q’16 4Q’15 3Q’15 2Q’15 1Q’15 Diluted EPS $ 0.19 $ 0.25 $ 0.22 $ 0.24 $ 0.16 Income before taxes 6,057 8,251 7,325 8,243 5,561 Net income 4,100 5,570 5,047 5,619 3,781 Return on average assets 0.68% 0.93% 0.86% 0.98% 0.67% Return on average equity 6.70% 8.80% 7.84% 8.86% 6.05% To
Slide 5: 1Q 2016 Financial Highlights
5 1Q 2016 Financial Highlights Income StatementNet income of $4.1 million, or $0.19 per diluted share.Net interest income of $19.8 million, up $1.7 million, or 9.2%, from year ago quarter.$0.5 million credit loan loss provision.Gains on mortgage loans of $1.6 million, down $0.5 million, or 23.2% fro
Slide 6: Our Michigan Markets
6 Our Michigan Markets Since 2012, substantial changes have been implemented to streamline and optimize our branch delivery network.Significant market presence and opportunity to gain market share in attractive Michigan markets. Michigan’s unemployment rate was 4.8% in March 2016 (1.0% lower than on
Slide 7: Our Markets – Regional
7 Our Markets – Regional Region Cities Branches 3/31/16 Loans(1) % ofLoans(1) 3/31/16Deposits(3) % of Deposits(3) 3/31/15 Loans(2) 3/31/15 Deposits(3) East / “Thumb” Bay City / Saginaw 23 $301 22% $727 35% $293 $732 West Grand Rapids / Ionia 22 532 39% 689 33% 468 618 Central Lansing 11 194 14% 317
Slide 8: Low Cost Deposit Franchise Focused on Core Deposit Growth
8 Low Cost Deposit Franchise Focused on Core Deposit Growth Deposit Highlights$2.15 billion in total deposits at 3/31/16.Substantially all core funding.$1.70 billion of transaction accounts (79.1% of total deposits).Total deposits increased $154.2 million, or 7.7% since 3/31/15.Average deposits per
Slide 9: Diversified Loan Portfolio Focused on High Quality Growth
9 Diversified Loan PortfolioFocused on High Quality Growth Lending HighlightsEight consecutive quarters of net loan growth.$1.57 billion in total loans at 3/31/16 (including $28.0 million of loans held for sale).1Q 2016 lending results include:Commercial loan growth of $22.5 million, or 12.1% annual
Slide 10: Net Interest Margin/Income
10 Net Interest Margin/Income HighlightsInterest rate sensitivity profile of the loan and securities portfolios, in combination with a low cost core deposit base, positions us to benefit from a rising interest rate environment.Net interest income increased in 1Q’16 vs. 4Q’15 due to a $32.0 million i
Slide 11: Net Interest Income and Net Interest Margin Details
11 Net Interest Income and Net Interest Margin Details Summary1Q’16 net interest income of $19.763 million, up $410K from 4Q’15. The linked quarter increase was due to a $485K increase in interest income and fees on loans and a $3K increase in interest income on securities and investments that was p
Slide 12: Non-interest Income Highlights
12 Non-interest Income HighlightsDiverse sources of non-interest income which totaled $7.8 million in 1Q’16.1Q’16 total non-interest income represents approximately 28.3% of total revenue (net interest income and non-interest income).1Q’16 interchange revenue down $0.3 million, or 12.3%, compared to
Slide 13: Non-interest Expense Highlights
13 Non-interest Expense HighlightsQ1’16 non-interest expenses totaled $22.0 million (a decrease from Q4’15 and from Q1’15).Q1’16 compensation and benefits increased slightly (by $0.1 million) over Q1’15 due to higher performance based compensation that reflects better overall profitability, improved
Slide 14: Investment Securities Portfolio
14 Investment Securities Portfolio HighlightsHigh quality, liquid, diverse portfolio with short duration.72% of the portfolio is AAA rated (or backed by the U.S. Government).2.0 year estimated average duration with a weighted average yield of 1.99% (with TE gross up).Approximately 33% of the portfol
Slide 15: Credit Quality Summary
15 Credit Quality Summary Note: Non-performing loans and non-performing assets exclude troubled debt restructurings that are performing. Non-performing Assets ($ in Millions) ORE/ORA ($ in Millions) Non-performing Loans ($ in Millions) 30 to 89 Days Delinquent ($ in Millions)
Slide 16: Credit Cost Summary
16 Credit Cost Summary Note: Dollars all in millions. Provision for Loan Losses Loan Net Charge-Offs Allowance for Loan Losses
Slide 17: Classified Assets and New Default Trends
17 Classified Assets and New Default Trends Note: Dollars all in millions. Total Classified Assets Commercial Loan New Defaults Total Loan New Defaults Retail Loan New Defaults
Slide 18: Troubled Debt Restructurings (TDRs)
18 Troubled Debt Restructurings (TDRs) TDR HighlightsWorking with client base to maximize sustainable performance.The specific reserves allocated to TDRs totaled $10.7 million at 3/31/16.A majority of our TDRs are performing under their modified terms but remain in TDR status for the life of the loa
Slide 19: 2016 Management Outlook
19 2016 Management Outlook Category Outlook Lending Continued growthGoal of high single digit % overall loan growth in 2016, primarily supported by increases in commercial loans, consumer loans and mortgage loans with payment plan receivables relatively stable. Expect much of this growth to occur in
Slide 20: Strategic Initiatives
20 Strategic Initiatives Balance SheetGenerate quality loan growth with continued focus on commercial and consumer installment lending as well as salable mortgage loans. May consider augmenting loan growth with selective in-market whole loan purchases.Remain asset sensitive and positioned to benefit
Slide 21: Q&A and Closing Remarks
21 Q&A and Closing Remarks Question and Answer SessionClosing RemarksThank you for attending !NASDAQ: IBCP