Camden National Corporation · NASDAQ:CAC
Camden National — Investor Presentation (September 2023)
32 slides from Camden National's investor presentation, Sep 6, 2023
Slide 1: Investor Presentation
1 Investor Presentation Greg Dufour | President & Chief Executive Officer Mike Archer | EVP, Chief Financial Officer September 6, 2023 1
Slide 2: Forward Looking Statements
2 Forward Looking Statements 2 This presentation contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other federal securities laws, including certain plans, exceptions, goals, projections, and statements, which are subject to num
Slide 3: Non-GAAP Financial Measures
3 Non-GAAP Financial Measures 3 This presentation includes certain non-GAAP financial measures. Management uses these non-GAAP financial measures for purposes of measuring our performance against our peer group and other financial institutions and analyzing our internal performance. These non-GAAP f
Slide 4: Camden National Corporation
4 Camden National Corporation Largest publicly traded bank headquartered in Northern New England (parent company of Camden National Bank) 4 As of August 29, 2023 As of June 30, 2023 $479 Million Market Cap $5.7 Billion Assets 49,375 Average Daily Volume $4.1 Billion Loans 57 Banking Centers $4.7 Bil
Slide 5: Why Camden National?
5 Why Camden National? Strong Long-Term Financial Performance and Shareholder Returns • History of strong financial performance and stable growth • Strong capital position with a history of growing dividends and repurchasing shares • Strong credit culture with a history of superior credit quality 5
Slide 6: Current Priorities and Recent Actions
6 Current Priorities and Recent Actions 6 Priorities Recent Actions Earnings Credit Quality Corporate Responsibility Human Capital & Customers • Optimize net interest margin • Expand presence in southern ME, MA & NH • Expand small business market share • Prudent expense management • Investments in p
Slide 7: Camden National by the Numbers
7 Camden National by the Numbers 7 Deposits Liquidity NIM Asset Quality Investments Capital As of or for the quarter ended June 30, 2023 unless otherwise noted • Loan/deposit ratio of 87% • Deposits increased 1% • Uninsured and uncollateralized deposits were 15% of total deposits • Available primary
Slide 8: Q3 Forward Guidance
8 Q3 Forward Guidance Strategy Q3 Expectation NIM • New loan originations 7%+ • Redeploy investment cash flows to fund loan growth and pay down borrowings • Leverage interest rate swaps • Focus on deposit retention and growth 2.40% (+/- 5–10 bps) Loan Growth • Slow loan growth to optimize net intere
Slide 9: ESG Highlights
9 ESG Highlights 9 Recent Actions: • Introduced a board- approved diversity core value and statement • Increased diversity of Board of Directors • Began developing an ESG framework and roadmap (with support of third-party consultant) • Shareholders approved de- classified Board structure As of or fo
Slide 10: Current Financial Update
10 Current Financial Update 10
Slide 11: 2Q 2023 Financial Highlights
11 2Q 2023 Financial Highlights 11 • Net income decreased by 3% and pre-tax, pre- provision earnings(1) decreased 13% from 1Q 2023 • Total loans grew <1% and deposits grew 1% from 1Q 2023 • Strong asset quality highlighted by non-performing assets of 0.09% of total assets and loans 30-89 days past d
Slide 12: Loans
12 Loans (1) Fed funds effective represents the quarterly average rate. Loan Portfolio Trend ($ in billions) 38% of loans are adjustable or variable rate 20% of loans reprice within 12 months 12 As of June 30, 2023
Slide 13: Deposits
13 Deposits (1) Fed funds effective represents the quarterly average rate. (2) This is a non-GAAP financial measure. Refer to the Company’s financial information filed with the SEC for the respective period. Average Deposit Composition and Cost (excl. Brokered) ($ in billions) Customers with <$1mm i
Slide 14: Investments
14 Investments (1) Fed funds effective represents the quarterly average rate. (2) Reported at book value. Securities Portfolio Mix and Trend(2) ($ in billions) Investment cash flows are being used to fund loan growth and pay down borrowings (estimated at $127 million over the next 12 months) 14 28%
Slide 15: Net Interest Income and Net Interest Margin
15 2.87% 2.84% 2.88% 2.76% 2.54% 2.40% 0.12% 0.77% 2.19% 3.65% 4.52% 4.99% -1.00% 1.00% 3.00% 5.00% 7.00% 9.00% $15 .0 $20 .0 $25 .0 $30 .0 $35 .0 $40 .0 Q1 '22 Q2 '22 Q3 '22 Q4 '22 Q1 '23 Q2 '23 Net Interest Income NIM (FTE) Fed Funds Effective(1) $36.4 $36.5 $37.8 $37.0 $34.3 $32.7 Net Interest In
Slide 16: Interest Rate Sensitivity
16 Interest Rate Sensitivity 16 Interest Rate Risk Position(1) • Liability sensitive Year 1 and asset sensitive Year 2; strategies employed have improved exposure to higher interest rates Current Strategy and Actions • Disciplined loan pricing • Manage deposit pricing on an exception- basis • Deposi
Slide 17: Uninsured Deposits and Liquidity
17 Uninsured Deposits and Liquidity Primary Liquidity Sources ($ in millions) Amount Amount Amount Excess Cash(2) $28.3 $17.3 $17.9 Unpledged Securities 522.3 570.2 411.4 Over Collateralized Securities Pledging Position 58.0 150.8 228.6 FHLB Borrowing Capacity 672.1 446.7 760.6 Current Fed Discount
Slide 18: Commercial Diversification
18 Commercial Diversification $2.1 billion $1.1 billion Commercial Real Estate • 65% of real estate located in Maine, 20% in New Hampshire, and 11% in Massachusetts • 80% non-owner occupied, 20% owner occupied • No material changes since 3/31/23 Real Estate Investment Breakdown (as of 6/30/23) CRE a
Slide 19: Office Portfolio
19 Office Portfolio • Office loans represent 5% of total loans and 12% of the commercial real estate portfolio • Projects require significant cash equity requirements, LTV minimum of 75% - 80% at origination, and requests for guarantors • Customer pays fixed rate on 67% of balances and floating rate
Slide 20: Investment Portfolio
20 Investment Portfolio • 59% AFS, 41% HTM • Duration of 5.7 years and weighted-average life of 7.7 years • Net unrealized loss on debt securities was $139 million at 6/30/23 • AFS unrealized loss of $100 million • HTM unrealized loss of $39 million Corporate Bond Ratings (20 holdings) Municipal Bon
Slide 21: Capital and Credit
21 Capital and Credit Provision for loan losses (annl.) / Avg loans 0.90% • Net unrealized losses on investments were $139 million • All regulatory capital ratios would continue to exceed regulatory requirements if investment losses were realized 0.92% 0.95% TCE ratio(1) and CET1 ratio 0.92% 0.91% 0
Slide 22: Historical Financial Information
22 Historical Financial Information 22
Slide 23: Creating Long-Term Shareholder Value
23 -100% -50% 0% 50% 100% 150% 200% 250% 300% Aug-08 Aug-09 Aug-10 Aug-11 Aug-12 Aug-13 Aug-14 Aug-15 Aug-16 Aug-17 Aug-18 Aug-19 Aug-20 Aug-21 Aug-22 Aug-23 CAC Proxy Peers S&P SmallCap Banks Russell2000 146% 215% 82% 98% Creating Long-Term Shareholder Value 23 Data range: August 29, 2008 – August
Slide 24: Balanced Long-Term Growth
24 $2.3 $2.2 $2.3 $2.3 $2.6 $2.6 $2.8 $3.7 $3.9 $4.1 $4.3 $4.4 $4.9 $5.5 $5.7 $5.7 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 YTD Total Assets $ in billions Balanced Long-Term Growth 24 Acquisitions: 2008 Union Bankshares 2012 Bank of America (14 branches) 2015 T
Slide 25: Net Interest Income and Net Interest Margin
25 Net Interest Income and Net Interest Margin 25 Avg. Earning Assets $5.2 Billion Avg. Funding $4.9 Billion 7% YoY Growth 7% YoY Growth All data is presented as of or for the year ended December 31, 2022 unless otherwise noted. Earning Asset Yield 3.34% 27 bps YoY Growth Funding Cost 0.51% 27 bps Y
Slide 26: Diversified Revenue Stream
26 Diversified Revenue Stream Assets under administration of $1.8 billion, up 12% year-over- year The company sold 37% of residential mortgages it originated through the first six months, compared to 21% for the same period in 2022 26 Revenue Trend ($ in millions) YTD figures are as of 6/30/23. As o
Slide 27: Driving Efficiency and Scale
27 Driving Efficiency and Scale 27 • Balanced approach to investing in the franchise while maintaining efficient operations • Efforts underway to enhance processes to drive efficiency and scale, including technology / software, digital channels, and RPA Efficiency ratio is a non-GAAP measure. Refer
Slide 28: Solid Credit Quality
28 Solid Credit Quality 28 Data presented for periods prior to 2020 does not reflect the impact of CECL. Peer Group defined as publicly traded banks and thrifts headquartered in the United States with total assets between $2.0 billion and $10.0 billion, excluding merger targets. YTD figures are as o
Slide 29: Strong Capital Position
29 Strong Capital Position 29 (1) “Required Minimum” including capital conservation buffer. (2) This is a non-GAAP measure. Refer to the Company’s financial information filed with the SEC for the respective period. Tier 1 Leverage Ratio Total Risk-Based Capital Ratio TCE Ratio(2) History of strong,
Slide 30: Capital Return
30 Capital Return (1) YTD figures are as of 6/30/23. (2) Payout Ratio = Total Dividend Paid + Total Share Repurchase Amount / Net Income for associated period. History of returning capital to shareholders through dividends and share repurchases Annualized dividend yield of 5.42% at June 30, 2023 30
Slide 31: Appendix
Appendix eC Garden NATIONAL CORPORATION
Slide 32: Executive Management Team
32 Executive Management Team 32 Name Position Age Years of Banking Experience Year Joined Camden Greg Dufour President and CEO 63 30+ 2001 Mike Archer, CPA EVP Chief Financial Officer 39 10+ 2013 David Ackley EVP Chief Risk Officer 48 10+ 2011 William Martel EVP Technology & Support Services 54 20+
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