Eagle Bancorp, Inc. · NASDAQ:EGBN
Eagle Bancorp — Investor Presentation (September 2011)
48 slides from Eagle Bancorp's investor presentation, September 2011
Slide 1: September 2011
September 2011 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 policies and
Slide 3: Additional Information About The Merger And Where To Find It (Continued)
Additional Information About The Merger And Where To Find It (Continued) Investors will be able to obtain these documents free of charge at the SEC's web site (http://www.sec.gov). In addition, documents filed with the SEC by Eagle Bancorp, Inc. will be available free of charge from Eagle's Investor
Slide 4: Company Overview
Company Overview Eagle Bancorp, Inc. is a rapidly growing commercial bank headquartered in Bethesda, Maryland o $2.4 billion in assets, focused on Washington, DC Metro Area with 14 branches o Commercially oriented business model with deep relationships on loan and deposit side of balance sheet o 2nd
Slide 5: History of Growth
History of Growth Founding members had extensive banking experience Commenced operations with three Maryland branches - July, 1998 Raised $46.5 million in initial and secondary subscription offerings - 1997* and 2003* Reached $500 million in assets in 2004 Private placement of $12.1 million of subor
Slide 6: Summary Statistics – June 30, 2011
Summary Statistics – June 30, 2011 Total Assets: $2.4 billion Total Loans: $1.9 billion Total Deposits: $1.9 billion Tangible Common Equity: $189.7 million Tangible Book Value per Common Share (1): $9.56 Shares Outstanding: 19,849,042 TARP Preferred: $23.2 million (redeemed July 14, 2011) Headquarte
Slide 7: EagleBank Locations
EagleBank Locations Loudoun County Montgomery County Reston Bethesda Prince George’s Tyson's Corner Washington, DC County Fairfax County Branch Locations Arlington Maryland 7 Washington, DC 5 Virginia 2 14 Alexandria In-Process 3 Total 17 6
Slide 8: Nationally Recognized Financial Performance
Nationally Recognized Financial Performance Named to the Class of 2011 Sm-All Stars by Sandler O’Neill + Partners as one of the Top 25 best performing small cap banks and thrifts in the nation. In 2011, ranked by the American Banker in the top 150 banks in the country for C&I loan activity and effic
Slide 9: Financial Indicators – Regional Peer Analysis
Financial Indicators – Regional Peer Analysis Key Ratios (at or for the quarter ended June 30, 2011): EGBN Peers ■ Net Interest Margin 4.32% 3.76% ■ Efficiency Ratio * 55.13% 67.97% ■ NPAs + 90 Days Past Due/Total Assets 1.47% 2.82% ■ NPLs + 90 Days Past Due/Total Loans 1.60% 3.32% ■ Allowance Loan
Slide 10: Financial Indicators – Local Peer Analysis
Financial Indicators – Local Peer Analysis EGBN Peers Loan Growth (June 30, 2010 - June 30, 2011) ■ Commercial & Industrial 30.14% 20.40% ■ Commercial Real Estate 23.92% 1.84% ■ Construction & Development 46.52% (11.35%) ■ Total Loans 29.52% 1.91% Deposit Growth (June 30, 2010 - June 30, 2011) ■ Dem
Slide 11: Consistent Balance Sheet Growth
Consistent Balance Sheet Growth $2,500 Total Assets $2,250 $2,000 $1,750 $1,500 Millions of Dollars $1,250 $1,000 $750 $500 $250 $0 06Q2 06Q3 06Q4 07Q1 07Q2 07Q3 07Q4 08Q1 08Q2 08Q3 08Q4 09Q1 09Q2 09Q3 09Q4 10Q1 10Q2 10Q3 10Q4 11Q1 11Q2 (1) Regional peers includes publicly-traded commercial banks wi
Slide 12: Consistent Net Income Growth
Consistent Net Income Growth Net Income Available to Common TARP Dividend $6,000 $5,754 $5,500 $5,000 $4,500 Thousands of Dollars $4,000 $3,500 $3,000 $2,500 $2,000 $1,500 $1,000 06Q2 06Q3 06Q4 07Q1 07Q2 07Q3 07Q4 08Q1 08Q2 08Q3 08Q4 09Q1 09Q2 09Q3 09Q4 10Q1 10Q2 10Q3 10Q4 11Q1 11Q2 (1) Regional pee
Slide 13: Pre-Tax, Pre-Provision Income
Pre-Tax, Pre-Provision Income $13,000 Quarterly Pre-Tax Pre-Provision Net Revenue $12,154 $12,000 $11,000 $10,000 $9,000 $8,000 Millions of Dollars $7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $0 06Q2 06Q3 06Q4 07Q1 07Q2 07Q3 07Q4 08Q1 08Q2 08Q3 08Q4 09Q1 09Q2 09Q3 09Q4 10Q1 10Q2 10Q3 10Q4 11Q1
Slide 14: Deposit Market Share
Deposit Market Share WASHINGTON, DC METROPOLITAN AREA (Dollar Values in Thousands) Local Headquarters Branches June 30,2009 June 30,2010 Annual 2010 Rank Rank Company Name City State in List Balance Balance Growth Market Share 1 Capital One McLean VA 217 $ 30,665,416 $ 26,627,589 -13.17% 19.25% 2 We
Slide 15: Loan Portfolio Composition
Loan Portfolio Composition Loan Portfolio by Type Loan Portfolio by Location Home Equity Other USA Land Other Consumer Prince William Other VA 4.7% 4.4% 4.3% 0.2% 1.0% 2.3% Loudoun 1.7% Fairfax Montgomery C&I 6.8% 26.9% Construction 24.8% Arlington 14.7% 2.0% Alexandria 2.1% Residential Mortgage 1.9
Slide 16: Geographic Detail of Loan Portfolio
Geographic Detail of Loan Portfolio (Dollar Values in Thousands) Owner Investment Residential Other County C&I Occupied CRE CRE Construction Land Mortgage Home Equity Consumer TOTAL % of Total Maryland Montgomery $ 176,410 $ 63,001 $ 166,200 $ 38,376 $ 9,734 $ 6,374 $ 61,419 $ 4,252 $ 525,766 27.0%
Slide 17: Diversified Commercial Real Estate Portfolio
Diversified Commercial Real Estate Portfolio Construction Loans by Type Investment CRE by Type UCC-1 Blanket Lien Apt to Condo Conversion Assignment of RE Sec. Note Retail - Single Tenant Retail - 2/3 Tenant UCC-1 Blanket Lien Office Condo Storage 0.1% 0.3% Retail Condo 4.2% 3.7% Cash Value Life Ins
Slide 18: Credit Quality Trends
Credit Quality Trends (Dollars Values in Thousands) As of As of As of As of As of As of As of As of Sep 2009 Dec 2009 Mar 2010 Jun 2010 Sep 2010 Dec 2010 Mar 2011 Jun 2011 30-89 Days Past Due $ 11,499 $ 18,849 $ 29,336 $ 31,259 $ 28,125 $ 31,495 $ 25,744 $ 25,727 Nonperforming Assets: 90 or More Day
Slide 19: Deposit Composition
Deposit Composition (Dollar Values in Thousands) As of June 30, 2010 As of December 31, 2010 As of June 30, 2011 Deposit Type % of % of % of Balance Total Balance Total Balance Total Noninterest Bearing $ 313,812 19.9% $ 400,291 23.2% $ 436,880 22.5% Interest Bearing Transaction 54,489 3.5% 61,771 3
Slide 20: Superior Relationships/Net Interest Margin
Superior Relationships/Net Interest Margin EGBN Peers 5.25% F&T closed August 31, 2008 4.75% Net Interest Margin (%) 4.32% 4.25% 3.76% 3.75% 3.25% 2Q2006 3Q2006 4Q2006 1Q2007 2Q2007 3Q2007 4Q2007 1Q2008 2Q2008 3Q2008 4Q2008 1Q2009 2Q2009 3Q2009 4Q2009 1Q2010 2Q2010 3Q2010 4Q2010 1Q2011 2Q2011 Note:
Slide 21: Capital Strength
Capital Strength (Dollars Values in Thousands) March 31, June 30, September 30, December 31, March 31, June 30, Pro Forma 2010 2010 2010 2010 2011 2011 Total Assets $ 1,832,991 $ 1,937,265 $ 2,006,146 $ 2,089,370 $ 2,186,268 $ 2,353,716 $ 2,387,081 Total Capital $ 192,465 $ 196,743 $ 202,301 $ 204,7
Slide 22: Market Information – Washington, DC Metropolitan Statistical Area
Market Information –Washington, DC Metropolitan Statistical Area Population 6.2 Million 5th largest market in the U.S. Employment 2.9 Million Average annual job creation is 39,500 Highest in net new job growth in the U.S. over last decade Washington DC Metro area has highest concentration of fastest
Slide 23: Unemployment Rate - Largest US Markets
22 8.7% US Unemployment Rate- Largest US Markets it tro De i am le s Mi nge sA Lo ta la n At g o ica d Ch klan a -O SF le May, 2011 at t phia Se l de ila Ph ork Y w Ne ton us Ho ix n oe Ph s lla Da n Source: BLS, NOT Seasonally Adjusted sto olis Bo p ea n nn o Mi ingt sh Wa 5.7 12 10 8 6 4 2 0
Slide 24: Greater Washington Economy - 2010
Greater Washington Economy - 2010 Total Federal Spending = 34.9% of GRP Other Federal International 15.7% 4.3% Hospitality 2.2% Associations 2.0% Federal Procurement Non-Local Business 19.2% 12.0% Other 8.0% Local Business 36.6% Note: Other includes Health/Education, Media 23 Source: George Mason Un
Slide 25: 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 30 % 22 20 20 14 14 11 9 8 9 10 6 6 6 4 6 5 4 7 5 4 4 2 3 2 2 1 3 1 3 0 0 0 -5 -4 -10 -9 -10 -9 -7 -12-11 -13-13 -14 -16-17 -20 -18 -20-18 -23 -23 -24 -25 -26 -30 Source: MRIS
Slide 26: New Condominium Inventory
New Condominium Inventory Washington DC 6000 5000 4000 3000 2000 1000 0 2005 2006 2007 2008 2009 2010 2011 Current Inventory = 821 Units Source: The Mayhood Co, July , 2011 25
Slide 27: Looking Ahead
Looking Ahead Complete merger and integration with Alliance Bank Focus on organic growth o Take advantage of dislocation in market o Hire seasoned lenders o Focus on relationships to increase deposit penetration Profitability o Continued focus on Net Interest Margin o Grow noninterest components of
Slide 28: Acquisitions
| Acquisitions 27
Slide 29: 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) System conversion successfully completed one week after close Targeted expense savings achieved in methodical and though
Slide 30: Alliance Bankshares Corporation Acquisition
Alliance Bankshares Corporation Acquisition Nasdaq: ABVA Strategic Matters: Opportunity for faster growth in targeted sub-market Acquire expertise in specialty deposit niche In-market acquisition provides superior integration benefits Both institutions are “well connected” to community Attractive cu
Slide 31: Alliance Bankshares Acquisition - Contribution Analysis
Alliance Bankshares Acquisition - Contribution Analysis (based on data at or for the period ended June 30, 2011) EGBN ABVA Combined Contribution buyer seller (dollars in thousands) Assets $ 2,353,716 $ 535,988 $ 2,889,704 19% Investment Securities $ 250,019 $ 114,370 $ 364,389 31% Loans $ 1,948,476
Slide 32: EagleBank Branches – Pro Forma
EagleBank Branches – Pro Forma EagleBank Branches Alliance Branches Planned Branches Source: SNL Financial, Company Information 31
Slide 33: Why Invest in EGBN?
Why Invest in EGBN? Driven by Profitability Superior Net Interest Margin Emphasis on Core Deposits and Deep Relationship Banking Strong Organic Growth Geographic Market Positioning Experienced and Dedicated Board and Management Team – 17% Insider Ownership Exceptional Asset Quality Record Conservati
Slide 34: EGBN Stock Price Performance
EGBN Stock Price Performance Price Change (%) EGBN S&P 500 NASDAQ Bank 40.00 35.00 30.00 25.00 20.00 15.00 10.00 5.00 0.00 -5.00 -10.00 -15.00 Oct-10 Nov-10 Dec-10 Jan-11 Feb-11 Mar-11 May-11 Jun-11 Jul-11 Sep-10 Sep-11 Apr-11 Aug-11 Source: SNL Financial 33
Slide 35: Appendices
Appendices 34
Slide 36: Loan Portfolio Trends
Loan Portfolio Trends Last 6 Annual Growth Months (Dollar Values in Thousands) As of June 30, 2010 As of December 31, 2010 As of June 30, 2011 Rate (Annualized) Loan Type Balance % of Total Balance % of Total Balance % of Total % % Commercial and Industrial $ 370,893 24.7% $ 411,744 24.6% $ 482,680
Slide 37: Loan Portfolio by Risk Rating
Loan Portfolio by Risk Rating (Dollar Values in Thousands) Loan Portfolio as of June 30, 2011 9999 - Loss 8000 - Substandard 9000 - Doubtful 1000 - Prime 2.4% 0.0% 0.0% 0.3% 7000 - Special Mention 2000 - Excellent Risk Rating Balance % of Loans 1.5% 5.6% 6000 - Watch 1000 - Prime $ 5,571 0.3% 1.6% 5
Slide 38: Geographic Detail of NPA's
Geographic Detail of NPA’s (Dollar Values in Thousands) Owner Investment Residential Home Other TOTAL TOTAL County C&I Occupied CRE CRE Mortgage Construction Land Equity Consumer NPLs OREO NPAs Maryland Montgomery $ 1,901 $ - $ - $ - $ 167 $ 535 $ 199 $ 8 $ 2,810 $ - $ 2,810 Prince George's 4 295 1,
Slide 39: Conservative Securities Portfolio
Conservative Securities Portfolio (Dollar Values in Thousands) June 30, 2011 Gross Gross Estimated Amrt. Cost Amortized Unrealized Unrealized Fair % of Total Security Type Cost Gain Losses Value Securities US Treasury Securities $ - $ - $ - $ - 0.0% US Government Agency Securities 102,989 1,470 63 1
Slide 40: Experienced Senior Management Team
Experienced Senior Management Team Years Years in with Name Title/Function Banking EGBN Ronald D. Paul Chairman, President & CEO 23 13 Robert P. Pincus Vice Chairman 38 3 Michael T. Flynn EVP & COO - Eagle Bancorp 40 7 Susan G. Riel Sr. EVP & COO - EagleBank 35 13 Thomas D. Murphy President - Commun
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 of
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 12 years. She previously served as Executive Vice
Slide 43: Experienced Management Team
Experienced Management Team Antonio F. Marquez, EVP, Chief Commercial Real Estate Lender Mr. Marquez, Executive Vice President, recently joined EagleBank as the Chief Real Estate. Lender. Prior to joing EagleBank, Mr. Marquez established the real estate lending franchise for HSBC for the Washington,
Slide 44: Historical Balance Sheet
Historical Balance Sheet 5 Year Compound 1 Year Growth Growth (Dollar Values in Thousands) 2006 2007 2008 2009 2010 Rate Rate Assets Cash and Equivalents $33,832 $20,142 $29,837 $117,687 $58,114 11.3% (50.6%) Securities Available for Sale 91,140 87,117 169,079 245,644 237,576 28.4% (3.3%) Total Cash
Slide 45: Historical Quarterly Balance Sheet
Historical Quarterly Balance Sheet Growth Growth Rate Rate 2Q2011 vs 2Q2011 vs (Dollar Values in Thousands) Dec 2009 Mar 2010 Jun 2010 S ep 2010 Dec 2010 Mar 2011 Jun 2011 2Q2010 1Q2011 Assets Cash and Equivalents $117,687 $100,367 $121,718 $99,412 $58,114 $107,165 $87,234 (28.3%) (18.6%) Securities
Slide 46: Historical Income Statement
Historical Income Statement (Dollar Values in Thousands, except per share data) 1 Year Growth 2006 2007 2008 2009 2010 Rate Total Interest Income $ 50,318 $ 57,077 $ 65,657 $ 84,338 $ 96,658 14.6% Total Interest Expense 17,880 23,729 23,676 24,809 19,832 (20.1%) Net Interest Income 32,438 33,348 41,
Slide 47: Historical Quarterly Income Statement
Historical Quarterly Income Statement (Dollar Values in Thousands, except per share data) Growth Growth Rate Rate 2Q2011 vs 2Q2011 vs Dec 2009 Mar 2010 Jun 2010 S ep 2010 Dec 2010 Mar 2011 Jun 2011 2Q2010 1Q2011 Total Interest Income $ 22,413 $ 22,508 $ 23,689 $ 24,421 $ 26,040 $ 26,296 $ 28,996 22.
Slide 48: GAAP Reconciliation
GAAP Reconciliation December 31, March 31, June 30, S eptember 30, December 31, March 31, June 30, (dollars in thousands except per share data) 2009 2010 2010 2010 2010 2011 2011 Common stockholders' equity $ 165,709 $ 170,016 $ 174,250 $ 179,764 $ 182,134 $ 187,490 $ 193,792 Less: Intangible assets
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