Kish Bancorp, Inc. · OTC:KISB
Kish Bancorp — Shareholder Meeting (May 2013)
59 slides from Kish Bancorp's shareholder meeting presentation, May 14, 2013
Slide 1: Building on Shared Values
Building on Shared Values BA = UI
Slide 2: Welcome and Call to Order
Welcome and Call to Order
Slide 3: Mission Statement
Mission Statement “With an unwavering focus on fulfilling client needs, we will achieve superior, long-term shareholder returns.”
Slide 4: Introduction of Board Nominees
Introduction of Board Nominees • Spyros A. Degleris • James J. Lakso • Phyllis L. Palm
Slide 5: Introduction
Introduction • Paul Howes, Kish Bank Board appointee
Slide 6: 2012 Highlights
2012 Highlights • Resolution of OCC agreement • Sustained focus on our clients • Strengthened balance sheet • Building the team • Growth in market share • Sustained commitment to community • Shareholder performance
Slide 7: Resolution of the Regulatory Agreement
Resolution of the Regulatory Agreement • What we learned: – “You passed the test” – Team strength validated – Regulatory risks were high
Slide 8: Resolution of the Regulatory Agreement (cont'd.)
Resolution of the Regulatory Agreement (cont’d.) • What it means now: – Constant vigilance – Renewed focus on growth
Slide 9: 2012 Financial Highlights
2012 Financial Highlights
Slide 10: Net Income ($ in thousands)
Net Income ($ in thousands) $4,500 $4,074 $4,001 $3,934 $3,938 $4,000 $3,848 $3,779 $3,631 $3,630 $3,556 $3,500 $3,213 $3,000 $2,500 $2,000 $1,500 $1,000 $500 $0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Slide 11: Earnings Per Share
Earnings Per Share $8.00 $7.37 $7.47 $7.16 $6.99 $6.94 $7.00 $6.69 $6.72 $6.74 $6.08 $6.10 $6.00 $5.00 $4.00 $3.00 $2.00 $1.00 $0.00 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Slide 12: Balance Sheet Trends ($ in millions)
Balance Sheet Trends ($ in millions) $600 $557 $560 $558 $527 $500 $476 $454 $455 $460 $446 $412 $413 $408 $396 $400 $357 $353 $332 $373 $374 $369 $319 $358 $301 $337 $300 $282 $309 $249 $291 $270 $200 $231 $197 $100 $0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Assets Deposits Loans
Slide 13: Net Interest Income ($ in thousands)
Net Interest Income ($ in thousands) $20,000 $18,000 $17,243 $16,988 $16,816 $16,000 $15,525 $14,138 $14,000 $12,107 $11,830 $12,000 $10,978 $10,536 $10,126 $10,000 $8,000 $6,000 $4,000 $2,000 $0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Slide 14: Net Interest Margin
Net Interest Margin KISB PA Peers¹ National Peers¹ 5.00% 4.00% 3.53% 3.52% 3.54% 3.26% 3.28% 3.35% 3.19% 3.18% 3.14% 3.08% 3.00% 2.00% 1.00% 0.00% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 ¹ Includes Bank Operating Companies in PA and Nationally with $500mm to $1B in Assets Source: SNL Finan
Slide 15: Noninterest Income ($ in thousands)
Noninterest Income ($ in thousands) $9,000 Bank Svc Fees Insurance KFS Sec Gains Travel $7,982 $8,000 $6,979 $7,000 $6,408 $6,000 $5,307 $5,305 $5,000 $4,618 $4,439 $3,798 $4,000 $3,000 $2,000 $1,000 $0 2005 2006 2007 2008 2009 2010 2011 2012
Slide 16: Total Revenue Mix ($ in thousands)
Total Revenue Mix ($ in thousands) $30,000 Net Int Inc Bank Svc Fees Insurance Sec Gains KFS Travel $25,225 $25,000 $23,795 $23,396 $20,830 $20,000 $17,936 $16,285 $16,448 $16,546 $15,000 $10,000 $5,000 $0 2005 2006 2007 2008 2009 2010 2011 2012
Slide 17: Noninterest Income/Operating Revenue (%)
Noninterest Income/ Operating Revenue (%) KISB PA Peers¹ National Peers¹ 45% 40% 39% 39% 35% 30% 30% 28% 27% 26% 27% 25% 23% 24% 22% 20% 15% 10% 5% 0% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 ¹ Includes Bank Operating Companies in PA and Nationally with $500mm to $1B in Assets Source: SNL F
Slide 18: Noninterest Expense ($ in thousands)
Noninterest Expense ($ in thousands) $25,000 $20,355 $20,000 $19,356 $17,520 $14,900 $15,000 $12,819 $11,417 $11,357 $11,542 $10,749 $10,290 $10,000 $5,000 $0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Slide 19: Noninterest Expense/Average Assets (%)
Noninterest Expense/ Average Assets (%) KISB PA Peers¹ National Peers¹ 4.50% 4.00% 3.73% 3.74% 3.58% 3.50% 3.44% 3.08% 3.00% 2.92% 2.86% 2.79% 2.72% 2.75% 2.50% 2.00% 1.50% 1.00% 0.50% 0.00% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 ¹ Includes Bank Operating Companies in PA and Nationally wi
Slide 20: Strengthened Balance Sheet and Asset Quality
Strengthened Balance Sheet and Asset Quality
Slide 21: Nonperforming Assets/Total Assets
Nonperforming Assets/ Total Assets KISB PA Peers¹ National Peers¹ 4.00% 3.50% 3.00% 2.50% 2.00% 1.67% 1.56% 1.50% 1.30% 1.08% 1.00% 0.71% 0.55% 0.80% 0.50% 0.33% 0.43% 0.29% 0.00% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 ¹ Includes Bank Operating Companies in PA and Nationally with $500mm t
Slide 22: Criticized and Classified Assets to Capital
Criticized and Classified Assets to Capital
Slide 23: Reserves/Gross Loans
Reserves/Gross Loans KISB PA Peers¹ National Peers¹ 2.25% 2.00% 1.92% 1.90% 1.75% 1.67% 1.50% 1.44% 1.24% 1.25% 1.00% 1.02% 1.01% 0.97% 0.98% 1.00% 0.75% 0.50% 0.25% 0.00% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 ¹ Includes Bank Operating Companies in PA and Nationally with $500mm to $1B in
Slide 24: Net Charge-Offs/Average Loans
Net Charge-Offs/Average Loans 1.50% KISB PA Peers¹ National Peers¹ 1.25% 1.00% 0.75% 0.50% 0.45% 0.35% 0.25% 0.18% 0.12% 0.07% 0.03% 0.05% 0.01% 0.00% 0.00% 0.00% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 ¹ Includes Bank Operating Companies in PA and Nationally with $500mm to $1B in Assets S
Slide 25: Loans 30-89 Days Past Due
Loans 30-89 Days Past Due KISB Peers¹ 2.00% 1.75% 1.50% 1.25% 1.13% 1.00% 0.73% 0.75% 0.63% 0.54% 0.52% 0.50% 0.50% 0.34% 0.28% 0.25% 0.19% 0.17% 0.08% 0.00% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 0313 Q ¹ Includes all public banks with assets between $300mm to $1B Source: FFIEC Uniform B
Slide 26: Capital
Capital
Slide 27: Consolidated Capital Ratios
Consolidated Capital Ratios Leverage Ratio Tier 1 Capital Ratio 12.00% 14.00% KISB Well Capitalized¹ KISB Well Capitalized¹ 10.00% 12.00% 11.4% 11.6% 8.6% 10.3% 10.3% 10.2% 8.3% 8.2% 8.2% 8.4% 8.3% 9.8% 7.7% 10.00% 9.5% 9.5% 9.4% 8.00% 7.6% 9.3% 7.4% 7.2% 8.00% 6.00% 6.00% 4.00% 4.00% 2.00% 2.00% 0.
Slide 28: Effective Capital Management
Effective Capital Management • Balance Sheet Management • Subordinated Debt – Raised total of $4.75mm between 2009 – 2011 – Qualifies as Tier 2 Capital • Private Placement – 2011 – Goal of raising up to $5mm in common equity – $3.8mm raised
Slide 29: Effective Capital Management (cont'd.)
Effective Capital Management (cont’d.) • Well capitalized • Stress testing of capital – Determination of internal minimum capital – Significantly above the required levels • Loan loss reserve
Slide 30: Building the Team
Building the Team
Slide 31: Additions to the Senior Management Team
Additions to the Senior Management Team • Walter Kay • Bill Hoyne • Jeremy Mattern
Slide 32: Building the Brand
Building the Brand
Slide 33: Coquese Washington, Kish Ambassador
Coquese Washington Kish Ambassador
Slide 34: Community Alignment
Community Alignment
Slide 35: Teach Children to Save
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Slide 36: Habitat for Humanity
Habitat for Humanity
Slide 37: Market Share
Market Share
Slide 38: Market Share: Mifflin County
Market Share Mifflin County - #1 Ranking 40.0% 35.0% 30.0% Kish Bank Juniata Valley Bank 25.0% Omega Bank/FNB 20.0% Mifflin County Savings Bank 15.0% Northwest Savings Bank Citizens Bank 10.0% 5.0% 0.0% 2006 2007 2008 2009 2010 2011 2012 Source: FDIC, Data as of June 30, 2012
Slide 39: Market Share: Huntingdon County
Market Share Huntingdon County - #3 Ranking 40.0% 35.0% 30.0% Community State Bank of Orbisonia Omega Bank/FNB 25.0% Kish Bank 20.0% Clearfield Bank & Trust 15.0% Northwest Savings Bank 10.0% Juniata Valley Bank 5.0% 0.0% 2006 2007 2008 2009 2010 2011 2012 Source: FDIC, Data as of June 30, 2012
Slide 40: Market Share: Centre County
Market Share Centre County - #9 Ranking 25.0% PNC Omega Bank/FNB 20.0% Nittany Bank M&T 15.0% Citizens Bank Northwest Savings Bank 10.0% Jersey Shore Bank CNB Bank 5.0% Kish Bank Graystone Tower/Susquehanna 0.0% Sovereign Bank 2006 2007 2008 2009 2010 2011 2012 Source: FDIC, Data as of June 30, 2012
Slide 41: Shareholder Performance
Shareholder Performance
Slide 42: Return on Average Equity
Return on Average Equity 20.0% KISB PA Peers¹ National Peers¹ 18.0% 16.5% 16.0% 15.3% 14.0% 13.3% 13.3% 13.0% 12.8% 12.0% 10.3% 9.7% 9.8% 10.0% 8.6% 8.0% 6.0% 4.0% 2.0% 0.0% -2.0% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 ¹ Includes Bank Operating Companies in PA and Nationally with $500mm t
Slide 43: Price/Book Value
Price/Book Value 250% KISB PA Peers¹ National Peers¹ 197% 200% 189% 185% 164% 150% 133% 107% 93% 100% 92% 86% 80% 50% 0% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 ¹ Includes Bank Operating Companies in PA and Nationally with $500mm to $1B in Assets Source: SNL Financial
Slide 44: Market Valuation
Market Valuation Market Price as a % of Tangible Book Value (Dec. 31, 2012) KISB Peers1 Peer Average 180.00% 160.00% 140.00% 120.00% 100.00% 80.00% 60.00% 40.00% 20.00% 0.00% ¹ Includes Bank Operating Companies in PA with $500mm to $1B in Assets Source: SNL Financial
Slide 45: Stock Performance vs. Peer Banks
Stock Performance vs. Peer Banks Market Price % Change Dec. 31, 2008 – Dec. 31, 2012 KISB Peers1 150.00% 125.00% 100.00% 75.00% 50.00% 25.00% 0.00% -25.00% -50.00% -75.00% -100.00% ¹ Includes Bank Operating Companies in PA with $500mm to $1B in Assets Source: SNL Financial
Slide 46: Dividends Per Share
Dividends Per Share $3.50 $3.24 $3.24 $3.24 $3.24 $3.24 $3.03 $3.00 $2.75 $2.47 $2.50 $2.24 $2.00 $1.50 $1.44 $1.00 $0.50 $0.00 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Slide 47: Dividend Yield on Common Stock
Dividend Yield on Common Stock 7.00% KISB PA Peers¹ National Peers¹ 5.89% 6.00% 5.59% 5.31% 4.95% 4.75% 5.00% 4.24% 4.00% 3.34% 3.00% 2.81% 2.56% 2.41% 2.00% 1.00% 0.00% 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 ¹ Includes Bank Operating Companies in PA and Nationally with $500mm to $1B in A
Slide 48: Actions to Support Valuation
Actions to Support Valuation • Repurchase activity • Dividend Reinvestment Plan – Program offered beginning in 2nd Quarter 2011 – Provides existing shareholders a simple, cost-effective method for purchasing shares of Kish common stock • Registrar & Transfer Company • Expanded market support – Raymo
Slide 49: 2-for-1 Stock Split
2-for-1 Stock Split • Announced: May 10, 2013 • Record Date: May 20, 2013 • Distribution Date: May 27, 2013
Slide 50: 2-for-1 Stock Split (cont'd.)
2-for-1 Stock Split (cont’d.) • Increases outstanding shares from 600,000 to 1.2 million • Increases authorized shares from 2 million to 4 million • Expect market price adjustment from $69.00 to $34.50 • Dividend to adjust from $3.24 to $1.62
Slide 51: 2-for-1 Stock Split (cont'd.)
2-for-1 Stock Split (cont’d.) • Increases affordability to broader range of investors • Increases liquidity • Indicates confidence in company’s growth prospects
Slide 52: Challenges & Opportunities
Challenges & Opportunities
Slide 53: Challenges & Opportunities
Challenges & Opportunities • Challenges – Regulatory climate – Economic expansion – Federal Reserve monetary policy – Allocation of resources – New normal • Opportunities – Maintain our focus on meeting client needs – Pursue growth opportunities – Leverage investment in infrastructure – Deleverage w
Slide 54: Strategic Focus
Strategic Focus • Maintain a strong balance sheet – Focus on asset quality metrics – Sustained profitability and performance – Capital allocations • Grow existing business lines – Expand the bank franchise in designated growth markets – Pursue opportunities for non-bank business expansion – Achieve
Slide 55: Financial Summary
Financial Summary • Diversified revenue mix • Robust asset quality • Strong liquidity and capital position • Elevated short-term expenses related to managing risk • Capable and committed management team • Positive core operating performance despite regulatory and economic headwinds • The kind of com
Slide 56: National Recognition
National Recognition • Ranked in American Banker magazine’s list of Top 200 community banks in the United States • Seven consecutive years
Slide 57: Kish Bancorp, Inc. Stock
Kish Bancorp, Inc. Stock NASDAQ Ticker: KISB www.KishBank.com Supporting shareholder value
Slide 58: Thank you!
Thank you!
Slide 59: Building on Shared Values
Building on Shared Values BA = UI