Beacon Financial Corporation · NYSE:BBT
Beacon Financial — Berkshire Hills Bancorp — Investor Presentation (February 2015)
25 slides from Beacon Financial's investor presentation, Feb 12, 2015
Slide 1: Investor Deck February 2015
Investor Deck February 2015
Slide 2: Who We Are
Who We Are Full service, regional bank with a distinctive brand and culture, strong middle market opportunities and a solid foundation for growth Assets: $6.5 billion Loans: $4.68 billion Deposits: $4.65 billion Wealth AUM: $1.4 billion LTM Core Revenue: $236 million Branches: 91 plus lending office
Slide 3: 2014 Strategic Highlights
2014 Strategic Highlights Significant quarterly core earnings growth: 20% (4Q14/4Q13) Grew core EPS $0.02 per quarter in each of the last 4 quarters Announced in-market acquisition of Hampden Bank (November) All-stock transaction valued at approximately $109 million Targeted to be accretive to EPS,
Slide 4: Well Positioned Footprint in Attractive Markets
Well Positioned Footprint in Attractive Markets BHLB HBNK Note: Acquisition of Hampden Bancorp Inc. pending Only regional bank operating across this central footprint Favorable positioning in rural markets 3
Slide 5: AMEB Culture
AMEB Culture People, attitude and energy RIGHT core values – Respect, Integrity, Guts, Having Fun and Teamwork Engaging and innovative customer experience Driven to make a difference 4
Slide 6: Talent Recruitment Drives Growth
Talent Recruitment Drives Growth Success with recruited teams driving growth and profitability Key Characteristics Established, well respected talent formerly attached to large banks focused outside our regions Solid relationships within community Strong integration within and across business lines
Slide 7: Strong Top and Bottom Line Momentum
Strong Top and Bottom Line Momentum Solid growth in revenues and earnings run-rate Core revenue growth: 17% (4Q14/4Q13) Core EPS growth: 20% (4Q14/4Q13) Fee income growth: 6% (FY14) Loan growth (FY14) Total loan growth: 12% Commercial loan growth: 15% Consumer loan growth: 11% Deposit growth: 21% (F
Slide 8: Double Digit Total Loan Growth
Double Digit Total Loan Growth $ Millions 8% 11% 17% 14% 12% total loan growth FY14 Leveraging deal flow from team recruitment Continued market share growth Healthy pipeline going into 1Q15 Targeting ongoing double digit commercial growth Expanded cross sales across footprint 7
Slide 9: Diversified Deposit Growth Strategies
Diversified Deposit Growth Strategies 20 branch purchase in Central New York completed 1Q14 $440 million, low cost deposits Balances/pricing retained 21% increase in total deposits LTM 17% decrease in cost of deposits LTM Diversifying deposit sources Organic account growth, DDA focus Branch consolid
Slide 10: Diversified Revenue Drivers
Diversified Revenue Drivers Emphasis on building fee income and enhancing cross-sell initiatives Spotlight on WM 10% revenue growth FY14 $1.4 billion in AUM Solid referral pipeline Spotlight on Small Biz Re-engineered across footprint Pipeline doubled y/y Risen to top 3 in SBA loans in several of ou
Slide 11: Hampden Bank Acquisition
Hampden Bank Acquisition On November 4, 2014 Berkshire announced the in-market acquisition of Hampden Bancorp (HBNK) in an all-stock transaction. Hampden (HBNK) has 10 branches in the greater Springfield, MA market, $700 million in assets and a compatible loan and deposit composition profile. The de
Slide 12: Focused on Long-term Profitability Goals and Building Shareholder Value
Focused on Long-term Profitability Goals and Building Shareholder Value Grew core EPS 29% before purchased loan accretion (4Q14/4Q13) Ongoing positive operating leverage from strong revenue growth and expense management Efficiency ratio below 63% - with goal of returning to sub-60% Focused on improv
Slide 13: Why Invest in Us
Why Invest in Us Strong top and bottom line momentum Diversified revenue drivers and controlled expenses Well positioned footprint in attractive markets AMEB culture Solid internal capital generation supports growth Focused on long-term profitability goals and shareholder value Acquisition disciplin
Slide 14: Appendix
Appendix Focus on Building Infrastructure Focus on Expenses Focus on Asset Liability Management Redefining Customer Engagement New York Branch Acquisition Financial Performance and Goals Non-GAAP Reconciliation 13
Slide 15: Focus on Building Infrastructure
Focus on Building Infrastructure National showcase for Archer risk/enterprise management solution Expanded financial planning and analysis resources for data driven management New retail loan originations platform implemented across footprint and virtual channel Installed top ranked loan analytics s
Slide 16: Focus on Expenses
Focus on Expenses Y/Y core expenses down 13 bps in relation to average assets 17 branches closed, consolidated or sold since 2012 3 branches designated for consolidation with HBNK acquisition in 2015 Additional branches under review New branches are smaller and more efficient 10% cost saves and 10%
Slide 17: Focus on Asset Liability Management
Focus on Asset Liability Management Targeting to protect and enhance income when rate/credit cycle turns Active balance sheet management – cost of funds down 29% LTM Q1 branch purchase added 11% to deposits – a stable, rural , low cost funding addition Near term margin compression with conservative
Slide 18: Redefining Customer Engagement
Redefining Customer Engagement Focused on enhancing both traditional and non-traditional methods Engaging Branches Friendlier pods replace teller lines Automated cash handling – lowers cost and improves customer engagement Community rooms bring in traffic Universal bankers create one stop shop for p
Slide 19: New York Branch Acquisition
New York Branch Acquisition On January 17, 2014 Berkshire completed the acquisition of 20 full service branches from Bank of America in Central New York at a 2.25% deposit premium. As a result of the transaction, total deposits grew by $440 million. Berkshire has been successful retaining the acquir
Slide 20: Financial Performance and Goals
Financial Performance and Goals Note: Core results exclude acquisition, divestiture, systems conversion, accounting correction and restructuring net charges after tax totaling $10.4 million in 2011, $11.1 million in 2012, $5.6 million in 2013 and $11.0 million in 2014. GAAP EPS for those periods was
Slide 21: Non-GAAP Reconciliation
Non-GAAP Reconciliation Note: See footnote on next page for description of non-core items 20 (Dollars in thousands) 2011 2012 2013 2014 Net income 17,348 $ 33,188 $ 41,143 $ 33,744 $ Non-core revenue (net) (2,113) (1,485) (6,045) 9,691 Non-core expense (net) 19,928 18,019 15,348 8,492 Income taxes (
Slide 22: Forward Looking Statements
ON NOVEMBER 3, 2014 BERKSHIRE ENTERED INTO AN AGREEMENT TO ACQUIRE HAMPDEN BANCORP, INC. PLEASE SEE RELATED SEC FILINGS FOR ADDITIONAL DETAILS. FORWARD LOOKING STATEMENTS THIS DOCUMENT CONTAINS FORWARD-LOOKING STATEMENTS AS DEFINED IN THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995. THERE ARE S
Slide 23: Additional Information for Stockholders
ADDITIONAL INFORMATION FOR STOCKHOLDERS In connection with the proposed merger with Hampden Bancorp, Berkshire has filed with the Securities and Exchange Commission (“SEC”) a Registration Statement on Form S-4 that includes a Proxy Statement of Hampden and a Prospectus of Berkshire, as well as other
Slide 24: Notes
Notes: 23
Slide 25: If you have any questions, please contact
If you have any questions, please contact: Allison O’Rourke 99 North Street Pittsfield, MA 01202 Investor Relations Officer (413) 236-3149 aorourke@berkshirebank.com
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