Lake Shore Bancorp, Inc. · NASDAQ:LSBK
Lake Shore Bancorp — Shareholder Meeting (May 2008)
27 slides from Lake Shore Bancorp's shareholder meeting presentation, May 21, 2008
Slide 1: Annual Meeting of Shareholders
Annual Meeting of Shareholders May 21, 2008 Exhibit 99.1
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation includes "forward looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements include, but are not limited to, statements concerning future business, revenue and earnings. These statements are not historical
Slide 3: Corporate Profile
Lake Shore Bancorp Inc. Corporate Profile Market Data (as of May 19, 2008) – (Source - NASDAQ) Ticker Symbol LSBK 52 – week Range $7.81 - $12.60 Current Price $10.05 Market Capitalization $64.26 million Shares Outstanding 6.39M shares 50 Day Avg. Trading Vol. 1,414 shares Dividend Yield 2.103% Owner
Slide 4: Lake Shore Savings Facts
Lake Shore Savings Facts: Our mission is to be a high quality, well respected financial institution in the markets that we serve. We will continue to serve the financial needs of the communities in our market area by providing various residential lending and Small Business Products. We will create v
Slide 5: Lake Shore Savings Facts: Continued
Lake Shore Savings Facts : Continued We take great pride in the work skills of our employees. We have served our community for over 117 years.
Slide 6: Positive Signs
Positive Signs Interest rate environment is changing. Yield curve is moving to a favorable position. Lower deposit cost will improve earnings. Strong Mortgage Lending levels. New Ad agency which is focused on Brand awareness. Erie County Offices growing and adding to the profitability of the bank. E
Slide 7: New Staff and Directors
New Staff and Directors Retail Banking Officer - Nancy LaTulip Director - Paul Kolkmeyer Director - Reginald Corsi (if elected today) Both Nancy LaTulip and Paul Kolkmeyer are well known in Erie County and will help to improve market share.
Slide 8: New Products 2007
New Products 2007 Commercial Overdraft Lines of Credit. SBA Loans. Business Debit Card. New Home Equity Product – allows borrower to allocate a portion of a line of credit to a fixed interest rate, with remainder having a variable interest rate.
Slide 9: Key Events
Key Events Announcement of Retirement of two key people at Lake Shore Savings: Reg Corsi, Chief Operating Officer and Thomas Reed, Director. Implementation of Remote Capture for our Retail Business Customers. Reduction in our efficiency ratio. Earnings continue to improve. Annual dividend increased
Slide 10: Financial Presentation
• Financial Presentation – Rachel Foley, CFO
Slide 11: Total Assets
Total Assets ($ in millions) $303.5 $329.8 $333.7 $354.2 $357.8 $368.1 $200.0 $250.0 $300.0 $350.0 $400.0 2003 2004 2005 2006 2007 Q1 2008
Slide 12: Loans, net
Loans, net ($ in millions) $187.1 $199.5 $206.2 $205.7 $218.7 $222.3 $100.0 $150.0 $200.0 $250.0 2003 2004 2005 2006 2007 Q1 2008
Slide 13: Loan Composition
Loan Composition (as of December 31, 2007) Commercial real estate 9.35% Construction loans 1.27% Commercial loans 3.78% One-to-four family 72.36% Consumer loans 1.06% Home equity 12.18%
Slide 14: Non-performing Loans as a Percentage of Gross Loans
Non-performing Loans as a percentage of Gross Loans 0.56% 0.40% 0.66% 0.64% 0.75% 0.00% 0.20% 0.40% 0.60% 0.80% 1.00% 2003 2004 2005 2006 2007
Slide 15: Loan Loss Reserves as a Percentage of Loans
Loan Loss Reserves as a percentage of Loans 0.69% 0.65% 0.60% 0.61% 0.56% 0.00% 0.20% 0.40% 0.60% 0.80% 1.00% 2003 2004 2005 2006 2007
Slide 16: Total Deposits
Total Deposits ($ in millions) $230.5 $243.6 $250.9 $249.6 $240.8 $250.3 $- $50.0 $100.0 $150.0 $200.0 $250.0 $300.0 2003 2004 2005 2006 2007 Q1 2008
Slide 17: Deposit Composition
Deposit Composition (as of December 31, 2007) Time Deposits > $100,000 13.73% Noninterest- Bearing Demand 8.02% Interest- Bearing Demand 15.75% Money Market Accts 9.63% Savings 10.50% Time Deposits < $100,000 42.36%
Slide 18: Net Interest Income
Net Interest Income ($ in millions) $8.1 $9.4 $9.5 $9.7 $9.5 $- $5.0 $10.0 $15.0 2003 2004 2005 2006 2007
Slide 19: Treasury Yield
Treasury Yield 1.25 1.5 1.72 1.97 2.47 2.64 3.18 3.48 3.89 4.57 4.57 4.55 4.95 5.02 4.97 4.86 4.86 4.9 4.93 5.09 5.0 5.18 1 mo 3 mo 6 mo 1 yr 2 yr 3 yr 5 yr 7 yr 10 yr 20 yr 30 yr Treasury Maturities 5/2/2008 7/2/2007
Slide 20: Interest Rate Margin & Spread
Interest Rate Margin & Spread (in percentages) 3.32 3.15 3.09 3.00 2.92 3.32 3.18 3.03 2.93 2.60 2.42 2.83 0.00 1.00 2.00 3.00 4.00 5.00 2003 2004 2005 2006 2007 Q1 2008 Net Interest Margin Interest Rate Spread
Slide 21: Net Income
Net Income ($ in millions) $1.5 $2.2 $2.1 $1.8 $1.8 $- $0.5 $1.0 $1.5 $2.0 $2.5 2003 2004 2005 2006 2007
Slide 22: Return on Average Assets
Return on Average Assets (in percentages) 0.58% 0.68% 0.62% 0.52% 0.52% 0.00% 0.20% 0.40% 0.60% 0.80% 1.00% 1.20% 1.40% 2003 2004 2005 2006 2007
Slide 23: Interest Rate Floor
Interest Rate Floor • Purchased August 2006. • Cost $221,000. • Covers $10 Million “notional” amount of variable rate loans tied to prime rate. • Receive interest income if prime rate falls below 8%. • Prime rate fell below 8% in September 2007. • $78,000 cumulative-to-date interest income received.
Slide 24: Interest Rate Floor (cont.)
Interest Rate Floor (cont.) • Floor product is a derivative. • Increase or decrease in fair market value is recorded as interest income. • Fair market value increased in 2007. • Recorded $298,075 of interest income in 2007. • Future increases or decreases in the fair market value may affect the net
Slide 25: 1st Quarter 2008 Results
st Quarter 2008 Results • Total Assets up $10.3 M since Dec st. – Loans, net up $3.6 M. – Cash up $5.5M. • Total Deposits up $9.5M since Dec st .
Slide 26: 1st Quarter 2008 Results
st Quarter 2008 Results • $658,000 net income compared to $298,000 in 1 quarter of 2007, a 121% increase. – $317,000 increase in interest income due to increase in fair market value of interest rate floor (compared to $9,000 increase in 1 Q 2007). – $106,000 increase in service charges and fees (com
Slide 27: Dividends Paid per Share
Dividends Paid per Share $0.03 $0.03 $0.03 $0.03 $0.04 $0.04 $0.05 $- $0.01 $0.02 $0.03 $0.04 $0.05 $0.06 Q4 2006 Q1 2007 Q2 2007 Q3 2007 Q4 2007 Q1 2008 Q2 2008