Slide 1: Investor Presentation August 2016
Investor Presentation August 2016
Slide 2: Disclaimers
DISCLAIMERS 2 Forward Looking Statements This presentation contains forward-looking statements within the meaning of the federal securities laws, which statements involve substantial risks and uncertainties. Forward-looking statements generally relate to future events, future financial condition, fu
Slide 3: MVBF Overview
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Slide 4: Experienced Management Team
Experienced Management Team 30 years of banking sector management – including service in a Big 8 accounting firm Named CEO of MVB Financial Corp. in 2009 Served as Retail Banking Manager for BB&T’s WV North Region (which included $2 billion in assets) President of Empire National Bank at 29 Delivers
Slide 5: MVB Overview
MVB Overview MVB Financial Corp. Total Assets: $1.5 billion 13 branches, 19 mortgage offices and a central operations center Two operating companies (MVB Bank and MVB Mortgage) Divested MVB Insurance as of June 30, 2016 Strong fee income streams Mortgage: $16.2M(1) 23% loan and 25% deposit CAGRs (20
Slide 6: Current Loan Portfolio
Current Loan Portfolio Source: SEC filings. Note: Data includes loans held for investment. Commercial business includes owner occupied CRE and residential includes 1-4 family construction loans. Includes Commercial Business, Commercial Real Estate, and Acquisition & Development categories. Percentag
Slide 7: Current Deposit Portfolio
Current Deposit Portfolio Source: SEC filings. Based on Q2’16 average balances. Non-time deposit balances based on Q2’16 average. Q2 ’16 Cost of Deposits = 0.71% 7 Non-Time Deposits(2) ($M) Deposit Composition(1) ($M) Noninterest bearing demand 8.9% Interest bearing demand 42.7% Savings and money ma
Slide 8: MVB Bank 2015 Notable Events
MVB Bank 2015 Notable Events Opened two new, technology-focused branch locations in West Virginia, with automated interactive teller systems Tech Park (Fairmont) Charleston Opened Reston, Virginia First MVB Bank branch location outside of West Virginia Implemented technology-focused branch Integrate
Slide 9: Track Record of Organic Growth
Track Record of Organic Growth Total Assets ($M) Total Deposits ($M) Net Loans HFI ($M) CAGR: 23% CAGR: 25% CAGR: 25% Net Income to Common ($M) CAGR: 22% 10 Source: SEC filings. Note: YTD = Year to date as of June 30th Based on $18.2M loans acquired through the acquisition of two Susquehanna branche
Slide 10: Our Growth Strategies
Our Growth Strategies Organic Growth Increase the productivity of existing relationships Enhance existing geographic footprint Measured expansion into new geographies Enhance profitability through improved core funding Opportunistic Growth Explore potential acquisitions of branches, fee income busin
Slide 11: Targeting Attractive Markets
Targeting Attractive Markets 12 Source: SNL Financial, United States Bureau of Labor Statistics Unemployment data per United States Bureau of Labor Statistics as of June 2016 Based upon MSAs primarily in West Virginia. Excludes the Washington DC MSA. Measured by MSA deposits. 6.1 million people, hig
Slide 12: New Market Demographics Accretive to MVB Legacy Franchise
Projected Population Growth (‘16-’21) New Market Demographics Accretive to MVB Legacy Franchise 13 Est. Household Income Growth (‘16-’21) Median Household Income (2016) Unemployment Rate (June 2016) Source: SNL Financial, Bureau of Labor Statistics. MVBF current franchise deposit weighted by county.
Slide 13: Second Quarter Financial Highlights
Second Quarter Financial Highlights 14 Source: SEC filings and company documents. Note: Reserves / Loans excludes loans held for sale. YTD = Year to date as of June 30 NPA’s include non-accruing loans, 90+ days still accruing and OREO. YTD 2016 includes $3.9 million of net income from discontinued o
Slide 14: Focus on Credit Monitoring
Focus on Credit Monitoring Dedicated in-market commercial lending teams with experienced senior lenders Management loan committee reviews and approves all commercial loans $1.5 million or greater Regular management and board review of concentrations on an aggregate and industry-level basis Experienc
Slide 15: Strong Asset Quality
Strong Asset Quality Note: Nonperforming assets include nonaccruals, OREO & 90+ past due. Source: SEC filings and SNL Financial. Regional peers defined as public banks headquartered in West Virginia, Maryland, Virginia, and the Washington D.C. MSA with assets between $750 million and $2.0 billion. 1
Slide 16: Securities Portfolio
Securities Portfolio 17 Securities Portfolio Composition MVBF’s securities portfolio consists primarily of U.S. Agency, U.S. Sponsored Mortgage-backed and municipal securities There were no investment securities held-to-maturity at June 30, 2016 Approximately 55% of the securities portfolio was pled
Slide 17: MVB Mortgage
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Slide 18: MVB Mortgage: Overview
MVB Mortgage: Overview 19 Acquired Potomac Mortgage Group, LLC (PMG) in December 2012 Co-founded by Ed Dean in 2009 Mr. Dean was instrumental in the building of George Mason Mortgage through its acquisition by UBSI and subsequent sale to Cardinal Financial Corporation Originates and sells government
Slide 19: MVB Mortgage Volume Analysis
MVB Mortgage Volume Analysis 20 2016 YTD Dollar Volume by State(1) 2016 YTD Volume by Transaction Type(2) Historical Volume Comparison ($M) (1) Historical Mortgage Fee Income ($M) Source: Company documents; YTD totals as of June 30. Volume displayed by dollars closed. Volume displayed by number of l
Slide 20: Residential Construction Portfolio
Residential Construction Portfolio $12.8 million Committed $7.5 million Outstanding $99.3 million Committed $62.2 million Outstanding $61.0 million Committed $32.5 million Outstanding $19.7 million Committed $10.7 million Outstanding MD: $8.4 million Committed $4.6 million Outstanding TOTAL: $211.6
Slide 21: Capital Structure and Pro-Forma Impacts
Capital Structure and Pro-Forma Impacts
Slide 22: Current Capital Structure
Current Capital Structure Non-GAAP financial measure. Please see “Non-GAAP Reconciliations” in the appendix to this presentation for details. Source: Company documents and SEC filings as of 6/30/16. $8.5 million SBLF; dividend rate stepped up to 9% in March 2016 $7.8 million of convertible preferred
Slide 23: Outlook and Goals
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Slide 24: MVB: Shareholder Value Focus
MVB: Shareholder Value Focus 25 Organic M&A Deposits Loans Assets Markets Client Development LSP Cost Control Budget Management Compensation Modeling / Analysis Core Values Workplace Compliance #MVBSynergy Client Experience Efficiency Ratio Project Management Facilities Best in Class Focus Fintech T
Slide 25: Selective & Strategic M&A Growth
Selective & Strategic M&A Growth Conducting Disciplined Deal-making: M&A deals will be rooted in a reasonable transaction price – based upon asset quality and deposits – and must demonstrate a true value for MVB shareholders Focusing on the Right Targets: Strategic opportunities in West Virginia and
Slide 26: Concluding Remarks
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Slide 27: MVB: Strategic Vision
MVB: Strategic Vision 28 MVB Bank Hire and develop top level talent Continue organic growth and improve profitability by enhancing existing franchise and expanding into attractive, growth markets Disciplined acquisition strategy MVB Mortgage Utilize talent lift-outs to drive growth Leverage entry in
Slide 28: Appendix
Ly FINANCIAL Appendix
Slide 29: Historical Financial Summary
Historical Financial Summary 30 Source: SEC filings and company documents. Note: Nonperforming assets include nonaccruals, OREO & 90+ past due; Reserves / Loans excludes loans held for sale. Total noninterest expense divided by the sum of noninterest income and net interest income. Noninterest incom
Slide 30: Non-GAAP Reconciliation
Non-GAAP Reconciliation 31 Source: SEC filings. TANGIBLE COMMON EQUITY / TANGIBLE ASSETS At or for the year ended, At or for the 6 months ended, (Dollars in Thousands, Except per Share) 12/31/10 12/31/11 12/31/12 12/31/13 12/31/14 12/31/15 6/30/15 6/30/16 Goodwill 896 897 17,622 17,779 17,779 18,480
Slide 31: Non-GAAP Reconciliation
Non-GAAP Reconciliation 32 Note: Results for 1H 2015 and 1H 2016 presented with insurance segment results classified as discontinued operations. Gain on sale of insurance subsidiary in 2Q16 was realized through discontinued operations. Source: SEC filings. NON INTEREST INCOME / OPERATING REVENUE At
Slide 32: Non-GAAP Reconciliation
Non-GAAP Reconciliation 33 Source: SEC filings and Company documents. Gain on Sale Margin At or for the year ended, At or for the 6 months ended, (Dollars in Thousands, Except per Share) 12/31/13 12/31/14 12/31/15 6/30/15 6/30/16 Mortgage Fee Income 20,801 17,557 29,472 14,926 16,182 Less: Originati
Slide 33: FINANCIAL
FINANCIAL