Bridgewater Bancshares, Inc. · NASDAQ:BWB
Bridgewater Bancshares — Q1 2021 Earnings Presentation
42 slides from Bridgewater Bancshares's earnings presentation, Apr 29, 2021
Slide 1: Investor Presentation Fourth Quarter 2019
Investor Presentation Fourth Quarter 2019
Slide 2: Disclaimer: Forward-Looking Statements
2 Disclaimer Forward-Looking Statements This presentation contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements include, without limitation, statements concerning plans, estimate
Slide 3: Q1 2021 Highlights
1 Represents a Non-GAAP financial measure. See Appendix for Non-GAAP reconciliation. 3 Q1 2021 Highlights $0.37 • Record quarterly net income of $10.7 million, a 43.4% increase over net income of $7.4 million for the first quarter of 2020 • Pre-provision net revenue1 (“PPNR”) of $15.6 million, which
Slide 4: Q1 2021 Financial Results
1 Represents a Non-GAAP financial measure. See Appendix for Non-GAAP reconciliation. * Change in basis points for profitability metrics 4 Q1 2021 Financial Results (dollars in thousands) Q1 2021 Q4 2020 % Change Q1 2020 % Change Income Statement Summary Interest Income 30,440 $ 30,699 $ (0.8%) 27,46
Slide 5: Strong Core Earnings Generation
5 Dollars in thousands Strong Core Earnings Generation Pre-Provision Net Revenue¹, Net Income, and ROA $12,157 $13,039 $13,200 $16,298 $15,598 $7,443 $7,598 $7,174 $4,979 $10,671 2.11% 2.00% 1.94% 2.30% 2.15% 1.29% 1.17% 1.05% 0.70% 1.47% Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 PPNR¹ Net Income PPNR
Slide 6: Strong Capital and Liquidity
$4.53 $5.40 $7.22 $8.33 $9.31 $9.80 2016 2017 2018 2019 2020 Q1 2021 Tangible Book Value Per Share¹ $244,704 $253,799 $262,088 $262,109 $275,923 10.13% 9.23% 9.46% 8.96% 8.99% Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Tangible Common Equity ($000)¹ Tangible Common Equity to Tangible Assets¹ 6 Strong C
Slide 7: Solid Capital and Liquidity
7 Dollars in thousands Solid Capital and Liquidity Consolidated Capital Ratios On & Off-Balance Sheet Liquidity as % of Total Assets 15.2% 18.3% 16.8% 18.4% 19.2% 14.0% 16.1% 15.5% 19.8% 22.3% $706,323 $948,234 $894,373 $1,121,145 $1,272,829 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 On-Balance Sheet L
Slide 8: Efficient Branch Footprint
Twin Cities Minnesota 8 Source: S&P Global Market Intelligence Efficient Branch Footprint
Slide 9: Growing Market Share
9 Source: S&P Global Market Intelligence; deposit market share data as of 6/30/2020. Growing Market Share 2006 Total Market 2020 Total Market Top 10 Institutions Deposits ($000) Share Top 10 Institutions Deposits ($000) Share Wells Fargo & Co. 16,308,234 $ 27.59% U.S. Bancorp 83,341,943 $ 38.23% U.S
Slide 10: Loan Growth Engine
10 Loan Growth Engine Dollars in millions • Despite payoffs of nearly $150 million, gross loan portfolio grew $100 million • Excluding PPP loans, gross loans increased net $74.9 million, or 13.9% annualized growth over the prior quarter • Loan pipeline remains strong and diversified among various as
Slide 11: Stable Core Operating Efficiency
11 Stable Core Operating Efficiency Efficiency Ratio Operating Expense Composition 1.68 1.37 1.40 1.34 1.49 0.01 0.27 0.02 0.82 0.02 44.1 40.4 41.7 36.6 40.7 44.4 48.6 42.3 59.0 41.2 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Adjustment Factors¹ / Avg. Assets Adj. NIE / Avg. Assets Adjusted Efficiency
Slide 12: Net Interest Margin
12 *Amounts calculated on a tax-equivalent basis using statutory federal tax rate of 21% Dollars in thousands • 26.3% YoY growth in net interest income • Q1 2021 net interest income includes the accelerated recognition of $1.1 million of PPP loan origination fees, which contributed 15 bps to NIM • Q
Slide 13: Net Interest Drivers
$1,954,959 $2,152,398 $2,206,807 $2,301,328 $2,389,919 5.17% 5.01% 4.93% 4.87% 4.72% 4.90% 4.76% 4.69% 4.59% 4.50% Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Average Loans Loan Yield Loan Yield Excluding Fees 13 *Yield is adjusted to exclude PPP loans Dollars in thousands Spot Rate 2.59% Spot Rate 4.37
Slide 14: Deposit Repricing Opportunities
$37,838 $33,351 $22,315 $16,741 $9,248 $34,468 $10,164 $29,182 $11,458 $13,896 $72,306 $43,515 $51,497 $28,199 $23,144 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Retail Time Deposit Maturities Wholesale Time Deposit Maturities* 14 1 Rate indicated assumes renewal into like term at market rates as of Ap
Slide 15: Loan Portfolio Repricing
15 Dollars in thousands Loan Portfolio Repricing Loan Portfolio – Repricing Composition 17.6%, Adjustable 23.0%, Variable 59.4%, Fixed Variable/Adjustable Loans vs. Rate Floors Fixed/Adjustable Years to Maturity/Repricing 88% 76% 61% 63% 81% 85% 12% 24% 39% 37% 19% 15% $238,810 $291,276 $275,243 $21
Slide 16: Deposit Growth
$60,000 $30,000 $18,500 $33,000 $1,900,127 $2,242,051 $2,273,044 $2,501,636 $2,638,654 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Total Deposits ($000's) PPP Loan Deposits ($000's) 16 • 42.8% YoY growth¹ in noninterest bearing deposits • Internal deposit growth plan momentum • Capitalizing on unique op
Slide 17: Historical Deposit Composition
23.3% 21.9% 23.6% 24.5% 26.9% 27.0% 13.0% 13.2% 11.5% 14.5% 14.6% 16.4% 23.4% 27.6% 25.8% 28.3% 26.3% 30.0% 26.6% 21.8% 20.4% 19.8% 14.1% 13.1% 13.7% 15.5% 18.7% 12.9% 18.1% 13.5% $1,023,508 $1,339,350 $1,560,934 $1,823,310 $2,501,636 $2,638,654 2016 2017 2018 2019 2020 Q1 2021 Noninterest Bearing T
Slide 18: Loan Growth
$180,228 $181,596 $138,454 $163,258 $2,002,817 $2,193,778 $2,259,228 $2,326,428 $2,426,123 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Total Gross Loans ($000's) PPP Loans ($000's) 18 • 13.0% YoY loan growth, excluding PPP loans • Q1 2021 gross loans grew $74.9 million, or 13.9% annualized, excluding PP
Slide 19: Historical Loan Composition
10.6% 9.7% 12.6% 10.3% 7.3% 8.0% 17.9% 14.5% 13.6% 13.6% 12.7% 12.2% 0.4% 0.3% 0.2% 0.2% 0.3% 0.3% 20.5% 23.6% 24.5% 26.9% 26.9% 27.4% 6.2% 4.9% 3.9% 3.5% 3.2% 3.3% 31.2% 30.8% 29.5% 31.0% 30.5% 29.7% 13.2% 16.2% 15.7% 14.5% 13.1% 12.4% 6.0% 6.7% $1,000,739 $1,347,113 $1,664,931 $1,912,038 $2,326,42
Slide 20: Loan Portfolio Composition
20 Dollars in thousands Loan Portfolio Composition Loans by Type Loan Portfolio Composition CRE NOO 29.7% Multifamily 27.4% C&D 8.0% 1-4 Family 12.2% CRE OO 3.3% C&I 12.4% PPP 6.7% Consumer & Other 0.3% $2.43 Billion $66,552 $37,083 $0 $25,000 $50,000 $75,000 $100,000 12/31/20 3/31/21 Modifications
Slide 21: Investor Real Estate Secured: CRE Nonowner Occupied
Dollars in thousands 21 Investor Real Estate Secured: CRE Nonowner Occupied (“NOO”) Portfolio Characteristics – CRE NOO Loan Balance Outstanding $720,396 % of Total Loans, Gross 29.7% Number of Loans 346 Average Loan Size $2,082 Loan-to-Value (Weighted Average) 60.2% 5 Year Net Charge-Offs (%) 0.01%
Slide 22: Portfolio Characteristics – CRE NOO Office
Dollars in thousands By Property Square Footage 22 Portfolio Characteristics – CRE NOO Office Loan Balance Outstanding $216,009 % of Total Loans, Gross 8.9% Number of Loans 99 Average Loan Size $2,182 Loan-to-Value (Weighted Average) 63.5% Investor Real Estate Secured: CRE NOO Retail Investor Real E
Slide 23: Portfolio Characteristics – CRE NOO Retail
Dollars in thousands By Property Square Footage 23 Portfolio Characteristics – CRE NOO Retail Loan Balance Outstanding $153,417 % of Total Loans, Gross 6.3% Number of Loans 100 Average Loan Size $1,534 Loan-to-Value (Weighted Average) 60.6% Investor Real Estate Secured: CRE NOO Retail Investor Real
Slide 24: Portfolio Characteristics – CRE NOO Industrial
Dollars in thousands By Property Square Footage 24 Portfolio Characteristics – CRE NOO Industrial Loan Balance Outstanding $154,541 % of Total Loans, Gross 6.4% Number of Loans 67 Average Loan Size $2,307 Loan-to-Value (Weighted Average) 56.2% Investor Real Estate Secured: CRE NOO Retail Investor Re
Slide 25: Portfolio Characteristics – CRE NOO Hotels
25 *Based on state of primary real property collateral if available, otherwise borrower address is used. Investor Real Estate Secured: CRE NOO Hotels Portfolio Characteristics – CRE NOO Hotels Loan Balance Outstanding $31,417 % of Total Loans, Gross 1.3% Number of Loans 6 Average Loan Size $5,236 Lo
Slide 26: Portfolio Characteristics – CRE NOO Restaurant
26 Portfolio Characteristics – CRE NOO Restaurant Loan Balance Outstanding $22,933 % of Total Loans, Gross 1.0% Number of Loans 18 Average Loan Size $1,274 Loan-to-Value (Weighted Average) 59.6% Investor Real Estate Secured: CRE NOO Restaurant Investor Real Estate Secured: CRE NOO Restaurant Full-Se
Slide 27: Portfolio Characteristics – Multifamily
5-19 Units 15.7% 20-49 Units 27.4% 50-99 Units 27.0% 100+ Units 29.9% $665 Million 27 Portfolio Characteristics – Multifamily Loan Balance Outstanding $665,415 % of Total Loans, Gross 27.4% Number of Loans 309 Average Loan Size $2,153 Loan-to-Value (Weighted Average) 61.7% 5 Year Net Charge-Offs (%)
Slide 28: Portfolio Characteristics – Construction and Development
Residential 29.4% Multifamily 40.3% CRE Other 9.1% Land 21.2% $193 Million 28 By Property Type By Geography* Land Portfolio Composition Investor Real Estate Secured: CRE NOO Restaurant Investor Real Estate Secured: Construction and Development Portfolio Characteristics – C&D Loan Balance Outstanding
Slide 29: Portfolio Characteristics – CRE Owner Occupied
29 Investor Real Estate Secured: CRE Nonowner Occupied (“NOO”) Portfolio Characteristics – CRE OO Loan Balance Outstanding $79,665 % of Total Loans, Gross 3.3% Number of Loans 130 Average Loan Size $613 Loan-to-Value (Weighted Average) 58.8% 5 Year Net Charge-Offs (%) (0.01%) Office 29.6% Retail 12.
Slide 30: Portfolio Characteristics – C&I
Dollars in thousands Real Estate and Rental and Leasing, 32.8% Construction, 22.4% Manufacturing, 12.7% Finance & Insurance, 9.5% Other, 7.5% Professional Services, 6.2% Wholesale/Retail Trade, 5.7% Accomodation & Food Services, 3.2% $301 Million 30 *Distribution by North American Industry Classific
Slide 31: PPP Origination Summary
31 New vs. Existing Client PPP Origination Summary as of 3/31/2021 Number of Loans Principal Balance Origination Fees Round 1 1,200 $ 181,600 $ 5,706 Round 2 517 70,144 3,041 Total 1,717 $ 251,744 $ 8,747 PPP Loans Existing Client 58.3% New Client 41.7% Dollars in thousands PPP Outstanding Summary A
Slide 32: Watch List and Substandard List
32 Investor Real Estate Secured: CRE Nonowner Occupied (“NOO”) Watch List By Loan Type Substandard List By Loan Type C&I 48.0% CRE NOO Retail 15.8% CRE NOO Hotels 27.0% 1-4 Family 1.2% CRE Other 8.0% $58 Million Asset Quality Dollars in thousands Watch List Characteristics Loan Balance Outstanding $
Slide 33: Asset Quality
Dollars in thousands 33 Asset Quality Asset Quality Classified Assets Nonperforming Assets Allowance for Loan Losses Net Charge-Offs $3,764 $3,740 $16,074 $15,164 $6,739 1.36% 1.20% 4.95% 4.54% 1.94% 0.00% 5.00% 10.00% 15.00% 20.00% 25.00% $- $2,000 $4,000 $6,000 $8,000 $10,000 $12,000 $14,000 $16,0
Slide 34: Investor Highlights
34 Investor Highlights Investor Highlights
Slide 35: Appendix
| APPENDIX BRIDGEWATER BANCSHARES, INC.
Slide 36: Recent Minnesota M&A Transactions
36 Note: data set includes selected Minnesota bank and thrift M&A transactions in recent years Source: S&P Global Market Intelligence; public filings Core Target Deal Deposit Announcement Total Assets Value Premium In Market / Buyer State Seller State Date ($mm) ($mm) (%) Market Entry MN MN 6/28/201
Slide 37: Potential Acquisition Targets
37 Source: S&P Global Market Intelligence; most recent quarter data *Dollars in thousands 265 •Commercial Banks located in Minnesota 232 •Commercial Banks located in Minnesota, with less than $500 million in assets 50 •Commercial Banks located in the Twin Cities MSA, with less than $500 million in a
Slide 38: Consolidated Summary Financial Information
38 1 Non-GAAP financial measures; for further information, see page 39 Consolidated Summary Financial Information - Historical Dollar Values in Millions 2016Y 2017Y 2018Y 2019Y 2020Y Balance Sheet Total Assets 1,260 $ 1,617 $ 1,974 $ 2,269 $ 2,927 $ Gross Loans 1,001 1,347 1,665 1,912 2,326 Deposits
Slide 39: Reconciliation of Annual Non-GAAP Measures
39 This presentation includes certain non-GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of these non-GAAP financial measures are provided below. The Company believes these non-GAAP financial measures provide useful information to both m
Slide 40: Reconciliation of Quarterly Non-GAAP Measures
40 This presentation includes certain non-GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of these non-GAAP financial measures are provided below. The Company believes these non-GAAP financial measures provide useful information to both m
Slide 41: Reconciliation of Quarterly Non-GAAP Measures – Pre-Provision
41 This presentation includes certain non-GAAP financial measures intended to supplement, not substitute for, comparable GAAP measures. Reconciliations of these non-GAAP financial measures are provided below. The Company believes these non-GAAP financial measures provide useful information to both m
Slide 42: Bridgewater Bancshares, Inc.
BRIDGEWATER BANCSHARES, INC.
Bridgewater Bancshares — Q1 2021 Earnings Presentation on 6ix