Lake Shore Bancorp, Inc. · NASDAQ:LSBK
Lake Shore Bancorp — Shareholder Meeting (May 2017)
32 slides from Lake Shore Bancorp's shareholder meeting presentation, May 17, 2017
Slide 1: Annual Shareholders' Meeting May 17, 2017
Annual Shareholders’ Meeting May 17, 2017 Annual Shareholders’ Meeting May 17, 2017
Slide 2: Agenda
.Call to Order - Gary W. Winger, Chairman .Introduction of Officers, Directors and Director Nominees .Secretary’s Report .Presentation of Proposals .Executive Management Report to Shareholders .Vote Report .Adjournment 2 Agenda
Slide 3: Board of Directors
irector Since Susan C. Ballard 2012 Tracy S. Bennett 2010 Sharon E. Brautigam, Nominating and Corporate Governance Committee Chairperson 2004 Reginald S. Corsi 2008 David C. Mancuso, Asset/Liability Committee Chairman 1998 John (“Jack”) L. Mehltretter 2016 Daniel P. Reininga, President and Chief Exe
Slide 4: Business of Annual Shareholders Meeting
Business of Annual Shareholders Meeting .Election of Three Directors: Jack L. Mehltretter Susan C. Ballard Daniel P. Reininga .An advisory vote on executive compensation (“Say-on-Pay”) .Ratification of the appointment of Baker Tilly Virchow Krause, LLP as independent registered public accounting fir
Slide 5: Executive Management Presentation
Daniel P. Reininga, President and Chief Executive Officer 5 Executive Management Presentation
Slide 6: Safe Harbor Statement
Safe Harbor Statement This presentation includes “forward looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. We intend such forward-looking statements to be covered by the Safe Harbor Provision and are including this statement for the purpose of such Safe
Slide 7: An Overview of Lake Shore
An Overview of Lake Shore 7 .Lake Shore Savings Bank is a federally chartered, community-oriented financial institution headquartered in Dunkirk, New York, with a longstanding history of community banking since 1891 .Focuses on organic growth of loan portfolio primarily through commercial real estat
Slide 8: An Overview of Lake Shore (Con't)
An Overview of Lake Shore (Con’t) 8 Source: SNL Financial as of March 31, 2017. Note: Stockholder information based on a closing stock price of $15.63 on 5/11/2017 * Includes 3.5% of the shares of common stock outstanding owned by the ESOP. Stockholder InformationDividendsMarket InformationDividend
Slide 9: Here Then. Today. Tomorrow. 125 Years
HERE THEN. TODAY. TOMORROW. 9 Celebrated 125 Years of Service in 2016 125 Years
Slide 10: Preparing for the Next 125 Years
HERE THEN STRENGTH – CHARACTER – VALUES HERE TODAY EXPERIENCE – COMMITMENT – FOCUS HERE TOMORROW GROWTH – TECHNOLOGY – INNOVATION 10 Preparing for the Next 125 Years
Slide 11: Millennial Advisory Board Members
MILLENNIAL ADVISORY BOARD MEMBERS .Alex Czechowski, Student, SUNY at Fredonia .Casey DeMarco, Assistant Vice President, Associate Relationship Manager, HSBC Bank .Brandon Ihrig, Math Teacher, Amherst High School .Molly Krauza, Associate Attorney, Colucci and Gallaher, PC .Kale Mann, President, Soar
Slide 12: New Products and Services
.Concierge Banking .CardValet® .Benefits Checking .Online Account Opening .Enhancements to Retail Mobile Banking .Introduction of Business Mobile Banking .Business Mobile Deposit Capture .EMV “chip” technology for debit cards .ATM Deposit Capture 12 New Products and Services
Slide 13: Strategic Focus to Enhance Value
13 .Grow deposits and diversify deposit mix, focus on low- cost core deposits .Grow loan portfolio and diversify the mix from residential to commercial loans .Grow and diversify non-interest income .Control expenses .Enhance the branch network and alternative delivery options .Increase number of, an
Slide 14: Positioned for Growth
.Dedicated to Community Banking Model .Take Advantage of Market Disruption .Focus on .High-Quality, Personalized Customer Service .Enhanced Operating Efficiency .Enterprise Risk Mitigation .Safe, Reasonable, Sustainable Growth 14 Positioned for Growth
Slide 15: Summary
After 125 years in business, we continue to be a local bank that cares about its customers and communities. At Lake Shore Savings, that has always meant “Putting People First”. We will continue to put our customers, communities and shareholders “First” during the next 125 years, as we adopt new tech
Slide 16: Financial Highlights
Rachel A. Foley, Chief Financial Officer and Treasurer 16 Financial Highlights
Slide 17: Financial Highlights
Financial Highlights 17 Financial data is presented for Lake Shore’s Fiscal Year Ended December 31 for each respective year or for Lake Shore’s quarter ended March 31 for each respective quarter. * In the first quarter of 2016, Lake Shore sold $14.1 million of long-term securities and recorded a $1.
Slide 18: Total Assets
Total Assets 18 .Focused on asset diversification to improve margins. Financial data is presented for Lake Shore’s Fiscal Year Ended December 31 for each respective year. $482.4M$482.2M$487.5M$473.4M$489.2M$493.9M$0$100,000$200,000$300,000$400,000$500,000$600,000201220132014201520161Q 2017Loans Rece
Slide 19: Loan Growth
Loan Growth 19 .Lake Shore continues to execute its strategic plan of organic growth primarily through loan originations. .Net Loans increased 5.7% since December 31, 2016 primarily due to organic commercial loan growth of 14.1%. Financial data is presented for Lake Shore’s Fiscal Year Ended Decembe
Slide 20: Loan Originations
Loan Originations 20 10.8% YOY Increase as of December 31, 2016 Dollars in millions. Data is presented for Lake Shore’s Fiscal Year ended December 31, 2014, 2015, 2016, and for the three months ended March 31, 2017. New Loans2014201520163/31/2017Residential Mortgage - New & Modified$15.98$21.37$16.4
Slide 21: NPLs/Total Net Loans
NPLs/Total Net Loans 21 .Lake Shore’s nonaccrual loans have consistently remained at lower levels compared to its peers. Financial data is presented for Lake Shore’s Fiscal Year Ended December 31 for each respective year. Peer group detailed on page 31. 0.89% 1.66%1.66% 1.57% 1.80% 1.29% 2.70% 4.12%
Slide 22: Loan Loss Reserves / Total Net Loans
Loan Loss Reserves / Total Net Loans 22 Financial data is presented for Lake Shore’s Fiscal Year Ended December 31 for each respective year.. 0.66%0.65% 0.67%0.67% 0.88% 0.93% 0.00% 0.20% 0.40% 0.60% 0.80% 1.00% 201220132014201520161Q 2017Continued Focus on Deposit Growth
Slide 23: Continued Focus on Deposit Growth
23 .Our focus has been on reducing our cost of funds by concentrating our efforts on growing core deposits. .Core Deposits as of March 31, 2017 are 61.7% of total deposits, an increase of 34% since 2012. Financial data is presented for Lake Shore’s Fiscal Year Ended December 31 for each respective y
Slide 24: Strong Net Interest Margin
Strong Net Interest Margin 24 .Despite operating in an environment that places significant pressure on spread and margin, Lake Shore’s margin has been increasing due to change to loan/deposit mix. Financial data is presented for Lake Shore’s Fiscal Year Ended December 31. Peer group detailed on page
Slide 25: Net Income Trends
Net Income Trends 25 Financial data is presented for Lake Shore’s Fiscal Year Ended December 31 for each respective year. Dollars in thousands except per share amounts. * In the first quarter of 2016, Lake Shore sold $14.4 million of U.S. Treasury Bonds resulting in realized gains of $1.6 million. $
Slide 26: Comparison of ROAA Results to Peers
Comparison of ROAA Results to Peers 26 Financial data is presented for Lake Shore’s Fiscal Year Ended December 31 for each respective year. Peer group is detailed on page 31. * In the first quarter of 2016, Lake Shore sold $14.4 million of U.S. Treasury Bonds resulting in realized gains of $1.6 mill
Slide 27: Continued Focus on Cost Control
Continued Focus on Cost Control 27 .Lake Shore’s efficiency ratios are generally below the peer group. Financial data is presented for Lake Shore’s Fiscal Year Ended December 31 for each respective year. Peer group is detailed on page 31. 69.2% 71.9% 76.5%74.6% 71.9% 74.6% 78.0% 76.0% 72.7% 79.3%79.
Slide 28: LSBK Price / Volume Chart Since IPO
LSBK Price / Volume Chart Since IPO 28 Price on 5/11/17 - $15.63 Source: SNL Financial. As of May 11, 2017. 4.006.008.0010.0012.0014.0016.0018.00255075100125150175200Price ($)Volume (shares 000's)VolumePrice
Slide 29: Creating Shareholder Value
Creating Shareholder Value 29 .High Capital Ratios enable organic growth without diluting shareholder value .Consistent dividend payment history .Stock buyback program currently in place Financial data is presented for Lake Shore’s Fiscal Year Ended December 31 for each respective year Dividends per
Slide 30: Questions & Answers
QUESTIONS & ANSWERS L Lake Shore Bancorp, Inc.
Slide 31: Appendix: Lake Shore Peer Data
Appendix: Lake Shore Peer Data 31 Source: SNL Financial as of the most recent reported quarter. MHCs located in the Mid-Atlantic and Northeast Regions. Excludes merger targets. Institution Name Ticker City, State Total Assets ($mm) HarborOne Bancorp, Inc. (MHC)HONEBrockton, MA$2,448Greene County Ban
Slide 32: Lake Shore, MHC Annual Meeting of Members
.Call to Order .Introduction of Proposal to Elect Directors .Tabulation of Votes .Adjournment 32 Lake Shore, MHC Annual Meeting of Members