Bar Harbor Bankshares, Inc. · AMEX:BHB
Bar Harbor Bankshares — Investor Presentation (November 2023)
30 slides from Bar Harbor Bankshares's investor presentation, Nov 15, 2023
Slide 1: Investor Presentation
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Slide 2: Legal Disclaimer: Cautionary Statement Regarding Forward-Looking Statements
Legal Disclaimer Cautionary Statement Regarding Forward-Looking Statements This presentation, including any oral statements made regarding the contents of this presentation, contains certain statements that are not historical facts that may constitute forward-looking statements within the meaning of
Slide 3: Legal Disclaimer: Non-GAAP Financial Measures
Legal Disclaimer Non-GAAP Financial Measures This presentation contains certain non-GAAP financial measures in addition to results presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”). These non-GAAP measures are intended to provide the reade
Slide 4: A Bank that Thinks Differently
A Bank that Thinks Differently • Employee and customer experience is the foundation of our performance, which leads to financial benefit to shareholders • Geography, heritage, and performance are key while remaining true to a culture that has long- term commitment to its communities • Commitment to
Slide 5: How is Bar Harbor Bank & Trust different?
How is Bar Harbor Bank & Trust different? We have adhered to a strategy of prudent growth for over 135 years. We take deposits from neighbors and lend to neighbors. • We like to lend money. We have an investment portfolio, but we don’t run it as a separate line of business and it is purposefully sca
Slide 6: Overview of Bar Harbor Bank & Trust
Overview of Bar Harbor Bank & Trust • We strive to be one of the most profitable banks in New England; and to provide exceptional service to people, businesses and communities we serve • Business overview as of September 30, 2023 • Over 50 locations spanning Northern New England1 • $2.3 billion in A
Slide 7: Bar Harbor Bankshares
4m BAR HARBOR BANKSHARES 4mm LOE™NS BAR HARBOR BAR HARBOR BANK & TRUST WEALTH MANAGEMENT —<- —
Slide 8: Senior Executive Team
Senior Executive Team Curtis C. Simard President & Chief Executive Officer • Joined as President & CEO of Bar Harbor Bank & Trust in June of 2013 • Served as Managing Director of Corporate Banking for TD Bank • Over 25+ years of industry experience SVP, Chief Human Resources Officer Alison DiPaola •
Slide 9: Our Markets
Our Markets The Bank serves a wide range of markets in Maine, New Hampshire and Vermont. Within our markets, tourism, agriculture, and fishing remain strong and continue to drive economic activity. These core markets have also maintained their strength through diversification into various services i
Slide 10: Strategy is working and the industry is taking notice
Strategy is working and the industry is taking notice 10
Slide 11: Fostering Sustainable Communities
Fostering Sustainable Communities 11 As a community bank, we recognize that we are successful when our customers and communities prosper We make significant investments in technology, our people, and branches. Our more than 50 branches are staffed by friendly, knowledgeable bankers who are driven by
Slide 12: Bar Harbor Bankshares
4m BAR HARBOR BANKSHARES 4mm LOE™NS BAR HARBOR BAR HARBOR BANK & TRUST WEALTH MANAGEMENT —<- —
Slide 13: BHB: Investment Summary
BHB: Investment Summary • We set out to build a balanced Bank that is not reliant on any one business, with a strong risk-focused credit culture, and a judicious approach to managing capital through all market conditions. We intend to do this by: • Growing market share as our customer service differ
Slide 14: 2023 Year-to-Date Overview
2023 Year-to-Date Overview • Poised for Continued, Profitable Growth • 1.18% core return on assets, compared to 1.12% • 4% annualized total loan growth, 7% annualized commercial loan growth • 4% annualized non-maturity deposit growth • 3.32% net interest margin, compared to 3.21% • 58% efficiency ra
Slide 15: Q3 2023 Overview
Q3 2023 Overview • 1.11% return on assets • 10.72% return on equity • Total loan growth remained flat for the quarter • 3.18% net interest margin • 59% efficiency ratio • 0.17% non-performing assets ratio to total assets • Book value per share of $26.67 “Our business is based on longstanding, basic
Slide 16: Diversification of Non-Interest Income
Diversification of Non-Interest Income • We have diverse sources of non-interest income that continue to be a significant contribution in any rate environment • Mortgage production is opportunistically managed between balance sheet and secondary market sales • Bar Harbor Wealth Management continues
Slide 17: Loans – Focus on Profitability
Loans – Focus on Profitability • Continue to prudently evaluate our loan portfolio mix & strategy • As of Q3 2023, Commercial Loans have increased from 49% to 67% of the Loan Portfolio since Q3 2018 17
Slide 18: Credit-Oriented Culture: Asset Quality Remained Strong at Q3 2023
Credit-Oriented Culture Asset Quality Remained Strong at Q3 2023 • Total delinquencies remain low at 0.25% of total loans • Non-accruing loans were steady at 0.23% of total loans • Net loan charge-offs of $24 thousand in Q3 2023 and $70 thousand YTD in 2023 18 • Q3 2023 Allowance for Credit Losses r
Slide 19: Commercial Real Estate – Office Exposure
Commercial Real Estate – Office Exposure Office portfolio remains sound amid industry challenges Total outstanding office loans of $245 million, or ~ 8% of total loans, at Q3 2023 • 85% of total Office Exposure is pass-rated, with no loans rated Substandard or worse • Weighted average risk rating of
Slide 20: Commercial Real Estate – Office Exposure: Heightened monitoring
Commercial Real Estate – Office Exposure Heightened monitoring amid industry challenges • In Q2 2023, $42.2 million of CRE-Office loans were downgraded, including 4 loans totaling $33.6 million that migrated to Risk Rating 6. These 4 loans have a weighted average loan-to-value of 66.5% and have the
Slide 21: Asset Quality
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Slide 22: Deposits – Maintain Portfolio Composition
Deposits – Maintain Portfolio Composition 22 • Shift in deposit composition due to customer preference for time deposits • Time deposit balances flat on a year-over-year basis • Non-interest bearing deposits remain at approximately 20% of total deposits
Slide 23: Continued Commitment to Strong Capital
Continued Commitment to Strong Capital 23 Note: The blue horizontal lines indicate minimum required levels for “well-capitalized” banks
Slide 24: Interest Rate Sensitivity Position
Interest Rate Sensitivity Position 24 • The Bank repositioned its net interest income (“NII”) sensitivity over the past year, moving from a fairly asset sensitive position (to take advantage of the rising rate environment) towards a more neutral position as we near the top of the rate cycle • More t
Slide 25: Investor Relations Contact Information
Investor Relations Contact Information 25 Facebook @BHBTsocial LinkedIn Bar Harbor Bank & Trust Twitter @barharborbank Connect with us on Social Media Visit our Website www.barharbor.bank/shareholder-relations Contact by Phone (207)288-2637 Write to us at Bar Harbor Bankshares Attn: Investor Relatio
Slide 26: Appendix
4m BAR HARBOR BANKSHARES 4mm LOE™NS BAR HARBOR BAR HARBOR BANK & TRUST WEALTH MANAGEMENT ey —
Slide 27: Historical Financial Performance
Historical Financial Performance 27 Audited Unaudited 2018Y 2019Y 2020Y 2021Y 2022Y 2022Q3 2022Q4 2023Q1 2023Q2 2023Q3 Total Assets $3,608 $3,669 $3,724 $3,709 $3,910 $3,840 $3,910 $3,928 $4,029 $3,984 Total Loans 2,488 2,635 2,563 2,532 2,903 2,850 2,903 2,944 3,007 2,993 Total Deposits 2,483 2,696
Slide 28: Non-GAAP to GAAP Reconciliations
Non-GAAP to GAAP Reconciliations 28 Audited Unaudited 2018Y 2019Y 2020Y 2021Y 2022Y 2022Q3 2022Q4 2023Q1 2023Q2 2023Q3 Net income $ 32,937 $ 22,620 $ 33,244 $ 39,299 $ 43,557 $ 11,430 $ 12,512 $ 13,012 $ 10,791 $ 11,104 Non-core items: Gain on sale of securities, net 924 (237) (5,445) (2,870) (53) (
Slide 29: Non-GAAP to GAAP Reconciliations (continued)
Non-GAAP to GAAP Reconciliations (continued) 29 Audited Unaudited 2018Y 2019Y 2020Y 2021Y 2022Y 2022Q3 2022Q4 2023Q1 2023Q2 2023Q3 Total revenue $ 119,742 $118,879 $142,136 $137,834 $149,002 $ 38,733 $ 41,182 $ 40,090 $ 37,770 $ 38,001 Total non-interest expense 75,539 89,733 94,860 90,508 91,253 23
Slide 30: Non-GAAP to GAAP Reconciliations (continued)
Non-GAAP to GAAP Reconciliations (continued) 30 Audited Unaudited 2018Y 2019Y 2020Y 2021Y 2022Y 2022Q3 2022Q4 2023Q1 2023Q2 2023Q3 Performance ratios (5) GAAP return on assets 0.93% 0.62% 0.88% 1.06% 1.16% 1.20% 1.30% 1.36% 1.10% 1.11% Core return on assets (2) (A/F) 0.99 0.82 0.93 1.10 1.17 1.20 1.
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