Customers Bancorp, Inc · NYSE:CUBI
Customers Bancorp — Investor Presentation (October 2015)
37 slides from Customers Bancorp's investor presentation, Oct 28, 2015
Slide 1: Investor Presentation October 2015
Highly Focused, Low Risk, Above Average Growth Bank Holding Company Investor PresentationOctober, 2015NYSE: CUBI Member FDIC
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation as well as other written or oral communications made from time to time by us, may contain certain forward-looking information within the meaning of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended. These statemen
Slide 3: Forward-Looking Statements continued
Forward-Looking Statements continued volatility in the credit and equity markets and its effect on the general economy;the effect of changes in accounting policies and practices, as may be adopted by the regulatory agencies, as well as the Public Company Accounting Oversight Board, the Financial Acc
Slide 4: Business bank and consumer bank start-up
A $7.6 billion asset business bank serving privately held businesses A consumer bank start up, set up as a division of Customers Bank, serving millennials, middle income families and underbanked throughout the United States Member FDIC
Slide 5: Banking Industry Trends and How We Deal with These Issues
Banking Industry Trends……How Do We Deal with These Issues Impediments to Growth External Forces Role of traditional bank branches changing very rapidlyMobile banking fastest growing channelBanks of all sizes revisiting their business strategies, revenue generation models and cost structuresTechnolog
Slide 6: Our Thesis on Current U.S. Banking Environment
Innovator / disruptor / not branch dependentDifferentiated / Unique modelTechnology savvyProduct dominance Our Thesis on Current U.S. Banking Environment Credit Improving – Though Banks Face a Number of Operational Headwinds Credit Quality ImprovingQuality Asset Generation Remains A ChallengeBanks a
Slide 7: Customers Bank Overview
Customers Bank Overview $7.6 bn Business Bank with 21 sales offices with target market from Boston to PhiladelphiaOperating in key Mid-Atlantic and Northeast marketsGreater New York City area (Westchester County, Manhattan and Melville)Philadelphia area (Bucks, Berks, Chester, Delaware and Philadelp
Slide 8: Our Competitive Advantage: A Highly Experienced Management Team
Our Competitive Advantage: A Highly Experienced Management Team
Slide 9: Investment Proposition
Investment Proposition Strong Organic Growth, Well Capitalized, Branch Lite Bank in Attractive Markets$7.6 billion asset bank with only 21 sales officesWell capitalized at 11.5% total risk based capital (estimated), 7.3% tier 1 leverage, and 6.3% tangible equity to tangible assetsTarget market from
Slide 10: Executing On Our Unique High Performing Banking Model
Customers Bank Executing On Our Unique High Performing Banking Model
Slide 11: Disciplined Model for Superior Shareholder Value Creation
Disciplined Model for Increasing Shareholder Value Strong organic revenue growth + scalable infrastructure = sustainable double digit EPS = growth and increased shareholder valueA very robust risk management driven business strategyBuild tangible book value per share each quarter via earningsAny boo
Slide 12: Execution Timeline
Execution Timeline We invested in and took control of a $270 million asset Customers Bank (FKA New Century Bank)Identified existing credit problems, adequately reserved and recapitalized the bankActively worked out very extensive loan problemsRecruited experienced management team Enhanced credit and
Slide 13: Banking Strategy – Customers Bank
Banking Strategy – Customers Bank Business Banking Focus - ~95% of revenues come from business segmentsLoan and deposit business through these well diversified segments:Banking Privately Held BusinessesManufacturing, service, technology, wholesale, equipment financingPrivate mid size mortgage compan
Slide 14: Organic Growth of Deposits with Controlled Costs
Results in: Organic Growth of Deposits with Controlled Costs Source: Company data. Total Deposit Growth ($mm) Average DDA Growth ($mm) Cost of Deposits Total Deposits per Branch ($mm) Customers strategies of single point of contact and recruiting known teams in target markets produce rapid deposit g
Slide 15: Lending Strategy
Lending Strategy High Growth with Strong Credit QualityContinuous recruitment and retention of high quality teamsCentralized credit committee approval for all loansLoans are stress tested for higher rates and a slower economyInsignificant deliquencies on loans originated since new management team to
Slide 16: Build an Outstanding Loan Quality Portfolio
NPL Source: SNL Financial, Company documents. Peer data consists of Northeast and Mid-Atlantic banks and thrifts with assets between $3.0 billion and $8.0 billion. Industry data includes all FDIC insured banks. Peer and Industry data as of June 30, 2015.. Build an Outstanding Loan Quality Portfolio
Slide 17: C&I & Owner Occupied CRE Banking Strategy
C&I & Owner Occupied CRE Banking Strategy Private & Commercial BankingTarget companies with up to $100 million annual revenuesVery experienced teamsFour new teams with 14 professionals added year to date, including a new business line Equipment Finance TeamSingle point of contactNE, NY, PA & NJ mark
Slide 18: Multi-Family Banking Strategy
Multi-Family Banking Strategy Banking High Net Worth Families Multi-Family Loan and Deposit Growth ($mm) Focus on families that have income producing real estate in their portfoliosPrivate banking approachFocus Markets: New York & Philadelphia MSAsAverage Loan Size: $4.0 – $5.0 millionRemote banking
Slide 19: Build Efficient Operations
Staff Expense Ratio Build Efficient Operations Source: SNL Financial, Company documents. Peer data consists of Northeast, and Mid-Atlantic banks and thrifts with assets between $3.0 billion and $8.0 billion. Industry data includes all FDIC insured banks. Peer and Industry data as of June 30, 2015. O
Slide 20: Disciplined & Profitable Growth
Deposit, Lending and Efficiency Strategies Results in Disciplined & Profitable Growth Core Revenue ($mm) Core Net Income ($mm) (1) Net Interest Income ($mm) Strategy execution has produced superior growth in revenues and earnings Income / Expense Growth ($mm) Core income is net income before extraor
Slide 21: Our Approach to Developing a Winning Business Model
Our Approach to Developing a Winning Business Model Must focus on both “Relationship” or “High Touch” banking combined with “Highly Efficient” or “High Tech”. Strategy should be unique as to not be copied easilyAttract and retain best high quality talent. Business Bankers / Relationship Bankers with
Slide 22: Customers Bank Risk Management
Customers Bank Risk Management
Slide 23: Elements of an Effective Risk Management Program
Elements of an Effective Risk Management Program
Slide 24: ERM Framework at Customers Bancorp, Inc.
ERM Framework at Customers Bancorp, Inc. Well Defined ERM Plan – ERM Integration into CAMELS +++++
Slide 25: BankMobile: A Revolutionary Division of Customers Bank
Customers¥ Bancorp, Inc. barkmoblle A REVOLUTIONARY bankmobile ape w a} A Division Of Customers Bank 25
Slide 26: Startling Facts about Banks
Startling Facts about Banks Banks each year charge $32 billion in overdraft fees – that’s allowing or creating over 1 billion overdrafts each year….Why??Payday lenders charge consumers another $7 billion in feesThat’s more than 3x what America spends on Breast Cancer and Lung Cancer combinedThis is
Slide 27: Creating a Virtual Bank for the Future for Consumers
New no fee banking, 25 bps higher interest savings, line of credit, 55,000 ATM’s, Personal Banker and more, all in the palm of your handMarketing Strategy Target technology dependent younger consumers; including underserved / underbanked and middle income AmericansCapitalize on retaining at least 25
Slide 28: Building Customers to Provide Superior Returns to Investors
Tangible BV per Share Building Customers to Provide Superior Returns to Investors Recent Performance Results Financial Performance Targets Earnings per Share Guidance / Valuation Multiples
Slide 29: Summary
Summary Strong high performing $7.6 billion bank with significant growth opportunitiesVery experienced management team delivers strong resultsRanked #1 overall by Bank Director Magazine in the 2012 and 2013 Growth Leader Rankings“High touch, high tech” processes and technologies result in superior g
Slide 30: Contacts
Contacts Company:Robert Wahlman, CFO Tel: 610-743-8074 rwahlman@customersbank.comwww.customersbank.com Jay SidhuChairman & CEOTel: 610-301-6476 jsidhu@customersbank.comwww.customersbank.com
Slide 31: Appendix
Appendix Customers = Bancorp, Inc.
Slide 32: Income Statement – Three Months
Income Statement CUSTOMERS BANCORP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE THREE MONTHS ENDED - UNAUDITED (Dollars in thousands, except per share data) Q3 Q2 Q3 2015 2015 2014 Interest income: Loans receivable, including fees $ 46,291 $ 42,801 $ 39,640 Loans held for sal
Slide 33: Income Statement – Nine Months
Income Statement CUSTOMERS BANCORP, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS FOR THE NINE MONTHS ENDED - UNAUDITED (Dollars in thousands, except per share data) September 30, September 30, 2015 2014 Interest income: Loans receivable, including fees $ 132,185 $ 103,216 Loans held f
Slide 34: Balance Sheet
Balance Sheet CUSTOMERS BANCORP, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET - UNAUDITED (Dollars in thousands) September 30, December 31, September 30, 2015 2014 2014 ASSETS Cash and due from banks $ 80,475 $ 62,746 $ 89,728 Interest-earning deposits 302,924 308,277 241,578 Cash and cash equiv
Slide 35: Net Interest Margin – Three Months
Net Interest Margin CUSTOMERS BANCORP, INC. AND SUBSIDIARIES AVERAGE BALANCE SHEET / NET INTEREST MARGIN (UNAUDITED) (Dollars in thousands) Three Months Ended September 30, 2015 2014 Average Balance Average yield or cost (%) Average Balance Average yield or cost (%) Assets Interest earning deposits
Slide 36: Net Interest Margin – Nine Months
Net Interest Margin CUSTOMERS BANCORP, INC. AND SUBSIDIARIES AVERAGE BALANCE SHEET / NET INTEREST MARGIN (UNAUDITED) (Dollars in thousands) Nine Months Ended September 30, 2015 2014 Average Balance Average yield or cost (%) Average Balance Average yield or cost (%) Assets Interest earning deposits $
Slide 37: Asset Quality
Asset Quality CUSTOMERS BANCORP, INC. AND SUBSIDIARIES Asset Quality as of September 30, 2015 (Unaudited) (Dollars in thousands) Total Loans Non Accrual /NPLs Other Real Estate Owned Non Performing Assets (NPAs) Allowance for loan losses Cash Reserve Total Credit Reserves NPLs / Total Loans Total Re
Customers Bancorp — Investor Presentation (October 2015) on 6ix