Eagle Bancorp, Inc. · NASDAQ:EGBN
Eagle Bancorp — Sterne Agee Financial Institutions Investor Conference 2013
51 slides from Eagle Bancorp's conference presentation, Feb 12, 2013
Slide 1: Eagle Bancorp Inc. - Sterne Agee Financial Institutions Investor Conference
* @EAGLE BANCORP INC. Sterne Agee Financial Institutions Investor Conference February 11-13, 2013 Ticker: EGBN www.eaglebankcorp.com
Slide 2: Forward Looking Statements
Forward Looking Statements . ; . This presentation contains forward looking statements within the meaning of the Securities and Exchange Act of 1934, as amended, including statements of goals, intentions, and expectations as to future trends, plans, events or results of Company operations and polici
Slide 3: Company Overview
Company Overview = Eagle Bancorp, Inc. is a growth oriented community bank headquartered in Bethesda, Maryland = Focused on the Washington, DC metropolitan area, with 17 current branches and 1 under development = Commercially oriented business model with deep relationships of loans, core deposits an
Slide 4: History of Growth
History of Growth = Founding members had extensive banking experience = Commenced operations with three Maryland branches - July, 1998 = — Raised $46.5 mil ion in initial and secondary subscription offerings - 1997* and 2003* = Reached $500 million in assets in 2004 = Private placement of $12.1 mill
Slide 5: Summary Statistics — December 31, 2012
| Summary Statistics — December 31, 2012 ‘Total Assets: $3.4 billion ‘Total Loans: $2.5 billion ‘Total Deposits: $2.9 billion ‘Tangible Common Equity: $289.6 million (1) ‘Tangible Book Value per Common Share: $12.62 (1) Shares Outstanding: 22,954,889 SBLF Preferred: (1% Dividend Rate, until December
Slide 6: Attributes of EagleBank
Attributes of EagleBank » — Driven by Profitability - 16 Consecutive Quarters of Increasing Earnings » — EPS Growth — 53% CAGR in Quarterly Earnings Per Share over past 3 years » — Superior Net Interest Margin - 4.32% for 2012 YTD, 4.31% in the 4" Quarter » — Balanced Organic Growth » — Geographic M
Slide 7: EagleBank Locations
| EagleBank Locations Reston Tyson's Comer =
Slide 8: Deposit Market Share
| Deposit Market Share WASHINGTON. DC METROPOLITAN AREA (Cater Value wren) Nealgtrs Prmcher Jone 502011 Jane302012 Ann 2012 Rank Campy ime Gey Ste Hat ance dane Gh Mike Stare 1 OF Capa one Melan VA ms $ mena $s B0S7 oS 2 WIC WatFago 800 Se Fanceco CA 16 D796 smh a BAC Bankof Anni Guuhwe NC 16 poms e
Slide 9: Financial Indicators — Regional Peer Analysis
| Financial Indicators — Regional Peer Analysis Key Ratios (at or for the quarter ended) Net Interest Margin (2) Efficiency Ratio Non-Interest Income/Total Revenue NPAs + 90 Days Past Due/Total Assets (2) NPLs + 90 Days Past Due/Total Loans Allowance Loan Losses/Gross Loans Coverage Ratio Net Charge
Slide 10: Financial Indicators — Local Peer Analysis
Financial Indicators — Local Peer Analysis Loan Growth (December 31, 2011 - December 31, 2012) = Commercial & Industrial = Commercial Real Estate Construction & Development = Total Loans Deposit Growth (December 31, 2011 - December 31, 2012) = Demand Deposits = Money Market Accounts = Certificates o
Slide 11: Consistent Balance Sheet Growth
Millions of Dollars Consistent Balance Sheet Growth 83,5009 Total Assets 33,2504 $3,004 82,7504 32,5004 92,2504 82,0004 1.7504 $1,504 81,2504 aA _Atl Porter CAGR: 5.8% | si,0004 s70- ss004 2504 O7Q4 O8QI OQ? 08Q3 _O8QI_O9QI 09Q2 09Q3 09Q4 10Q1 10Q2 10Q3 10QI 11QI 11Q2 11Q3 11Q4 12Q1 1292 1293 1294 o
Slide 12: Growth in Pre-Tax, Pre-Provision Income
Millions of Dollars Growth in Pre-Tax, Pre-Provision Income same Quarterly Pre-Tax Pre-Provision Net Revenue sar $20,000 $19,000 $18,000 317.0004 $16,000 $15,000 $14,000 $13,000 $12,000 $11,000 $10,000 39.0004 8.0005 87.0005 [Peer CAGR: 4.2% nN LULA O7Q4 OBQI_O8QZ _O8Q3_—O8QI_ OQI_ 092 09Q3 —O9QF 10
Slide 13: Growth in Total Revenue
| Growth in Total Revenue [SNe fnterest Income Ml Gain on Sale of Loans 61 Other Now $35,009 $30,000 $25,0004 20,0004 15,0004 10,0004 85,0004 so4 (07Q408Q108Q208Q308Q409Q109Q209Q309Q4 10Q110Q210Q3 10411Q111Q211Q311Q412Q112Q2 2Q312Q4 = Strong growth in Non-interest Income, but Net Interest Income is
Slide 14: Consistent Net Income Growth
Consistent Net Income Growth BINet Income Available to Common Il TARP Dividend D SBLF Dividend 11,0009 $10,198 10,0004 39,0004 $8,000 7.0004 6.0004 35,0004 s4,0004 eer CAGR: (fees cAGR: 5.0% cant ONLY O7Q1 O8QI_ OQ? 0893 OSQI_O9QI_ O9Q2 09 NOE 1OQI 10Q2 1093 1OQH_T1Q1 11Q2 113 110 2 3,004 004 31,000
Slide 15: Geographic Detail of Loan Portfolio
Geographic Detail of Loan Portfolio Me ae TR ES i Ce Tee Te Metueer, ESS ERS OS SESSA CE SIS SPOS SIF ROT DE 32835 26,582 8698120758 4042 3,665,789. 100 200,380 8.0% Other MD 25929 23,964 «3974 “103,582 $4,560 53,294 44746270253. 276,20 11.1% Virginia Alexandra 10,587 10,947 : 18676 11,538 : 1720 1,
Slide 16: Credit Quality Trends
Credit Quality Trends (Dollars Values in Thousands) 30-89 Days Past Due Nonperforming Assets: 90 or More Days Past Due Nonacerual Restructured Loans ‘Total Nonperforming Loans (NPLs) Other Real Estate Owned (OREO) Total Nonperforming Assets NPAs + 90 Days Past Duc/Assets (1) Reserves Reserves/Loans
Slide 17: Consistent Asset Quality
Consistent Asset Quality Total Loans rE erage ‘soo annpen nom Growth NPAs Charge-Offs (ooo) 2008 ‘$548,963 1.76% 0.12% $200,000.00 | seo 10 $e Asmat ‘$1,s00,009000 + 2010 ‘$ 276,189 153% 0.35% ‘i nou $m am =a ieee 2012, $436,839 1.06% 0.37% $senpongcn ais ‘Net Charge Off History av) eka e wr ia Expe
Slide 18: Balanced Loan and Deposit Growth
Balanced Loan and Deposit Growth '$3,000,000,000 {$2,500,000,000 $2,000,000,000 $1,500,000,000 ‘m Total Loans Total Deposits $1,000,000,000 $50,000,000 so 2 Om mM LPO S LEP EPEP PREP ERE oO) (1) @ 2011 Deposits exclude the “Settlement deposit”
Slide 19: Deposit Composition
| Deposit Composition (Bellas Vals in Thousands) Deposit Type %of % of %of Balance ‘Total Balance Total Balance ‘Total % Noninterest Bearing, S 688,506 28.8% S$ 796,654 31.7% $881,390 30.4% 28.0% Interest Bearing Transaction 80,105 3.3% 112,901 4.5% 113,813 3.9% 42.1% Core Savings & Money Market'* 1
Slide 20: Superior Relationships/Net Interest Margin
Superior Relationships/Net Interest Margin 5.25% FST closed August 31, 2008 Net Interest Margin (%) ae 3.25% 1Q2010 12008 22008 40007 fon, DC, Virginia,
Slide 21: Capital Strength
| Capital Strength (Dollars Values in Thousands) Total Assets s Total Capital s Tier 1 Leverage Ratio Tier 1 Risk Based Capital Ratio Total Risk Based Capital Ratio Tangible Common Equity Ratio 2) (2) This constitutes non-GAAP financial measure. Pease reer to the GAAP: in ‘non-GAAPfinancial measures
Slide 22: Nationally Recognized Financial Performance
Nationally Recognized Financial Performance SANDLER O'NEILL+ PARTNERS "2022 “Top Investment Idea” Recommendation = 2011 “Sm-All Stars” Designation = Designated as a “Grower” Bank 2012 = Honor Roll of Community Banks 2010 & 2011 ® Ranked 39" among Best Performing Community Banks in the U.S. 2011 = To
Slide 23: Highly Regarded by Bank Rating Firms
| Highly Regarded by Bank Rating Firms FIRM IDC Analyze the Future VERIBANC = BAUERFINANCIAL, INC RATING 273/300 Green - *
Slide 24: Market Information — Washington, DC MSA
Market Information —Washington, DC MSA = Population a Sth largest market in the U.S = Employment a 34,300 new jobs created in last year Average annual job creation is 24,800 over last decade Highest in net new job growth in the U.S. over last decade Unemployment rate of 5.0% vs. US average of 7.8% o
Slide 25: Unemployment Rate - Largest US Markets
Unemployment Rate- Largest US Markets November, 2012 Source: BLS, NOT Seasonally Adjusted
Slide 26: Average Sales Price Percent Change Washington MSA
Average Sales Price Percent Change Washington MSA All Housing Types Annual Change Annual Change by Month % 2008 2009 2010 2011 2012 30 262 20 14 343 isl 9 75,89 4 u | Treen Th a RAT i Source: MRIS, GMU Center for Regional Analysis 2
Slide 27: Greater Washington Economy
Greater Washington Economy Hospitality 2.0% Assoctations 2.0% Non-Local Business 91% Other 82% Note: Othe s
Slide 28: Key Success Factors
Key Success Factors = Building and maintaining core relationships = Maintenance of strong credit culture o Conservative underwriting criteria and loan policies » Disciplined Committee Approval and Review Process o Limited Individual Authority o Periodic Loan and Portfolio Stress Testing o Asset Base
Slide 29: Key Success Factors (continued)
Key Success Factors (continued) = Maintained focus on areas of strength » Concentration on core geographic markets and products = Built the proper infrastructure to support the increased volume of business and regulation = Significant Management and Board level reporting = Human Resources o Addition
Slide 30: Looking Ahead
Looking Ahead = Capitalize on investment in Northern Virginia market Emphasis on Organic Growth o Hire seasoned lenders and business development officers o Expand customer base o Focus on relationships to increase deposit penetration and multiple product usage Profitability » Continued focus on Net
Slide 31: EGBN Stock Price Performance
| EGBN Stock Price Performance Price Change (%) 00 2 ro rs = ra Fs ro = rs S ro 2 a 8 3 £ gz 4 3 2 8 3 2 é 4 Stock Price Performance 1 Year 3 Year 3 Year EGBN 34.3% 100.5% 79.2% NASDAQ Bank Stock Index 16.5% 14.4% 27.8% S & P 500 Index 14.1% 39.5% 8.7% ‘Source: SNL Financial, Bloomber, Chat andcaeua
Slide 32: Appendices
Appendices
Slide 33: Conservative Securities Portfolio
| Conservative Securities Portfolio (Delis tli ie hassants) USGovemment Ageney Secusites 47606 17 n 16.86 ‘Municipal Bonds 72050 S314 si 2h (Other Equity Investments 07 os oe ‘USCovemmen Agency Seusties ” v7 nam Monkipatbonds 2 pie ine ther Bay Investments * an care nie = z = Sar Toe = Portfolio has
Slide 34: Loan Portfolio Trends
Loan Portfolio Trends (Qeliae Vacs in Thos ads) Loan Type Balance_ _9 of Total Balance _% of Total Balance _%% of Total % Commercial and Industrial $478,886 233% = S$ 534,133 223% «$545,070 21.9% 13.8% Owner Occupied 250,174 12.2% 306,148, 12.8% 297,857 119% 19.1% (Owner Occupied-Const 34,497 1.7% 1
Slide 35: Loan Portfolio Composition
| Loan Portfolio Composition Total Gross Loans: $2.5 Billion ‘Note: At December 31, 2012 ‘4
Slide 36: Diversified Commercial Real Estate Portfolio
| Diversified Commercial Real Estate Portfolio Total: $393.4 Million Total: $914.6 Million ‘Note: At December 31, 2012 35
Slide 37: Loan Portfolio by Risk Rating
Loan Portfolio by Risk Rating Dollar Values in Thousands) S 10330 4302 18.764 210855, 3000 - Good 813,161 943,499 4000 - Acceptable 706,703 846,201 5000+ Acceptable with Risk 287059 338674 6000 - Wateh 20837 40808 7000 - Special Mention. 25282 36,380 8000 - Substandard 55083 7238 9000 - Doubtful 37
Slide 38: Geographic Detail of NPA's
Geographic Detail of NPA’s (Dollar Values in Thousands) Maryland Moigomery «S$ «1582'S HS = SU SOIT S| S$ MS - S 20m S220 § 42% Prince George's » 266 - 1,265 + 1208 Ms 29 3.206 3503556 Otter MD 06 19s : 182 i 315 : é 1 2519 60s RIS Washingion DC 1484 . : me : Bo 9.284 iso 78 Virginia Alsandin 1s : P
Slide 39: Acquisition Strategy & History
Acquisition Strategy & History Significant Due Diligence precedes any Offer to Acquire Accretive Transactions are always the Goal Acquisition #1 (F&T completed on August 31, 2008) a System conversion successfully completed one week after close a Targeted expense savings achieved in methodical and th
Slide 40: Experienced Senior Management Team
| Experienced Senior Management Team Years in Name Title/Function i Ronald D. Paul Chairman, President & CEO 25 15 Robert P. Pincus Vice Chaiman 40 4 Michael T. Flynn EVP & COO - Eagk Bancorp 42 9 Susan G. Riel Sr. EVP & COO - EagkBank 37 15 ‘Thomas D. Murphy President - Community Banking - EagleBan
Slide 41: Experienced Management Team
| Experienced Management Team Ronald D. Paul, Chairman, President and CEO Mr. Paul, a founder of EagleBank, has served as Chairman since May 2008, and prior to that time was Vice Chairman and Chief Executive Officer since the organization of the Company. He also has served as Chairman of the Board o
Slide 42: Experienced Management Team
| Experienced Management Team Susan G. Riel, Senior EVP, Chief Operating Officer of EagleBank Ms. Riel, Senior Executive Vice President - Chief Operating Officer of the Bank, and formerly Chief Administrative Officer. Ms. Riel has been with the bank for 13 years. She previously served as Executive V
Slide 43: Experienced Management Team
| Experienced Management Team AntonioF. Marquez, EVP, Chief Commercial Real Estate Lending Officer Mr. Marquez, Executive Vice President, recently joined EagleBank as the Chief Real Estate Lender. Prior to joining EagleBank, Mr. Marquez established the real estate lending franchise for HSBC for the
Slide 44: Experienced Management Team
| Experienced Management Team James HL EVP, Chief Financial Officer, Eagle rp, Inc. and Eé Mr. Langmead, Executive Vice President and Chief Financial Officer of the Company since January 2007, and Executive Vice President and Chief Financial Officer of the Bank since January 2005, previously served
Slide 45: Historical Balance Sheet
Historical Balance Sheet
Slide 46: Historical Quarterly Balance Sheet
Historical Quarterly Balance Sheet ({) Please refer to the GAAP reconciliation and footnotes in the appendices on pages 48-50, 45
Slide 47: Historical Income Statement
| Historical Income Statement (Dollar Values n Thousands, except per share data) Total Interest Ineome ‘Total Interest Expense [Net Interest Income Loan Loss Provision Service Charges on Deposits Gain/Loss on Sale of Loans Gain/Loss on Sale of Securities BOLI Revenue (Other Noninterest Income ‘Total
Slide 48: Historical Quarterly Income Statement
| Historical Quarterly Income Statement (llr teen Towzond, xcept por ohare dota) “Total tere ncone Total Inerest Bpawe [Ne Interest Inorne Lom Los Provision ter Neniteret Income “Teal Noniteret ese Sabres an Ep ye Benefits Premises and Equipment Epenses ter Novinterest pense ‘Teal Nniteret Egense Ne
Slide 49: GAAP Reconciliation
GAAP Reconciliation GAAP Reconciliation (Unaudited) dollars in thousands except per share data) ‘Twelve Months Ended ‘Twelve Months Ended December 31, 2012 December 31,2011 Common shareholders’ equity $ 293376 S$ 210,111 Less: Intangible assets (3.785) (4,145) ‘Tangible common equity $ 289.501 S$ 20
Slide 50: GAAP Reconciliation
| GAAP Reconciliation
Slide 51: GAAP Reconciliation Footnotes
GAAP Reconciliation Footnotes (1) Tangible common equity to tangible assets (the "tangible common equity ratio") and tangible Q B ) book value per common share are non-GAAP financial measures derived from GAAP-based amounts. The Company calculates the tangible common equity ratio by excluding the ba
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