First Keystone Corp. · OTC:FKYS
First Keystone — Shareholder Meeting (May 2019)
56 slides from First Keystone's shareholder meeting presentation, May 14, 2019
Slide 1: First Keystone Corporation Annual Stockholders' Meeting May 9, 2019
First Keystone Corporation Annual Stockholders’ Meeting May 9, 2019
Slide 2: Robert A. Bull, Chairman
Robert A. Bull 1i¢ airman > wZ
Slide 3: Forward-looking statements (Diane C. A. Rosler, CFO)
Diane C. A. Rosler This presentation contains certain forward - looking statements, which are included pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 , and reflect management’s beliefs and expectations based on information currently available . These
Slide 4: Income Statement
INCOME STATEMENT IN GRAPHIC COMPONENTS OF How we generated OTHER INCOME $41,135 in income: (OTHER NON-INTEREST INCOME ITEMS 207 2018 How we used our $41,135 in income: marae ED @S FB) come on ioans
Slide 5: Average Total and Earning Assets
$800,000 $850,000 $900,000 $950,000 $1,000,000 $1,050,000 2014 2015 2016 2017 2018 $900,952 $954,593 $985,089 $1,001,985 $1,005,334 $825,683 $881,892 $910,637 $927,179 $929,548 Average Total Assets Average Earning Assets Average Total and Earning Assets (amounts in thousands)
Slide 6: Average Loan and Investment Balances
$300,000 $350,000 $400,000 $450,000 $500,000 $550,000 $600,000 2014 2015 2016 2017 2018 $468,470 $509,605 $518,145 $536,054 $584,960 $356,043 $370,061 $389,176 $388,488 $341,826 Loans Investments Average Loan and Investment Balances (amounts in thousands)
Slide 7: Loan and Investment Yields
2.50% 3.00% 3.50% 4.00% 4.50% 5.00% 2014 2015 2016 2017 2018 4.51% 4.35% 4.33% 4.30% 4.49% 3.28% 3.14% 2.97% 3.11% 3.47% Loan Yields Investment Yields Loan and Investment Yields (tax equivalent)
Slide 8: Interest Earning Assets vs. Interest Bearing Liabilities
$650,000 $700,000 $750,000 $800,000 $850,000 $900,000 $950,000 2014 2015 2016 2017 2018 $825,683 $881,892 $910,637 $927,179 $929,548 $696,031 $734,963 $748,621 $762,114 $761,742 Interest Earning Assets Interest Bearing Liabilities Interest Earning Assets vs. Interest Bearing Liabilities (tax equival
Slide 9: Net Interest Spread and Net Interest Margin
2.50% 2.60% 2.70% 2.80% 2.90% 3.00% 3.10% 3.20% 3.30% 3.40% 3.50% 2014 2015 2016 2017 2018 3.33% 3.15% 3.03% 2.93% 2.98% 3.43% 3.27% 3.16% 3.09% 3.18% Net Interest Spread Net Interest Margin Net Interest Spread and Net Interest Margin (tax equivalent )
Slide 10: Loan and Investment Income
$5,000 $10,000 $15,000 $20,000 $25,000 $30,000 2014 2015 2016 2017 2018 $21,127 $22,143 $22,420 $23,057 $26,281 $11,663 $11,638 $11,564 $12,077 $11,877 Loan Income Investment Income Loan and Investment Income (tax equivalent) ( amounts in thousands)
Slide 11: Average Interest Bearing Deposits and Borrowings
$- $100,000 $200,000 $300,000 $400,000 $500,000 $600,000 2014 2015 2016 2017 2018 $566,243 $583,356 $609,219 $607,222 $596,401 $129,788 $151,607 $139,402 $154,892 $165,341 Average Interest Bearing Deposits Average Borrowings Average Interest Bearing Deposits and Borrowings (amounts in thousands)
Slide 12: Deposit and Borrowing Costs
0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 2014 2015 2016 2017 2018 1.15% 1.19% 1.33% 1.50% 2.07% 0.52% 0.54% 0.56% 0.70% 0.87% Deposits Borrowings Liability Costs | Deposit and Borrowing Costs
Slide 13: Deposit and Borrowing Expense
$- $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 2014 2015 2016 2017 2018 $2,954 $3,159 $3,425 $4,232 $5,192 $1,498 $1,807 $1,857 $2,316 $3,428 Deposit Interest Borrowing Interest Interest Expense | Deposit and Borrowing Expense (amounts in thousands)
Slide 14: Non-Interest Income and Expense
$- $5,000 $10,000 $15,000 $20,000 $25,000 2014 2015 2016 2017 2018 $21,208 $21,022 $20,348 $21,521 $22,645 $5,146 $5,566 $5,165 $5,233 $5,562 Total Non-Interest Income Total Non-Interest Expense Non - Interest Income and Expense (amounts in thousands)
Slide 15: Net Income After Taxes, Tax Expense & Net Securities Gains/Losses
$(2,000) $- $2,000 $4,000 $6,000 $8,000 $10,000 $12,000 2014 2015 2016 2017 2018 $10,211 $9,172 $9,472 $8,648 $9,211 $2,617 $1,971 $1,845 $1,455 $459 $2,756 $2,131 $1,764 $938 $(65) Net Income After Taxes Tax Expense Net Securities Gain/Loss Net Income After Taxes, Tax Expense & Net Securities Gains
Slide 16: Return on Assets and Return on Equity
0.00% 1.00% 2.00% 3.00% 4.00% 5.00% 6.00% 7.00% 8.00% 9.00% 10.00% 2014 2015 2016 2017 2018 1.13% 0.96% 0.96% 0.86% 0.92% 9.90% 8.43% 8.23% 7.54% 8.05% Return on Average Assets Return on Average Equity Return on Assets and Return on Equity
Slide 17: Earnings and Dividends per Share
$- $0.20 $0.40 $0.60 $0.80 $1.00 $1.20 $1.40 $1.60 $1.80 $2.00 2014 2015 2016 2017 2018 $1.84 $1.64 $1.68 $1.52 $1.60 $1.05 $1.08 $1.08 $1.08 $1.08 Earnings Dividends Earnings and Dividends per Share
Slide 18: Income Statement, 3 Months Ended March 31, 2019
Income Statement Net Interest Income +Non - Interest Income =Operating Revenue - Loan Loss Provision =Pre - Tax Income - Income Tax Expense =Net Income Earnings Per Share 3 Months Ended March 31, 2019 3 Months Ended March 31, 2018 % Change $6,821 1,507 $8,328 92 5,855 $2,381 138 $2,243 5.1 19.7 7.5
Slide 19: Balance Sheet
Balance Sheet Cash & Cash Equivalents Securities Net Loans Premises & Equip., Net Other Assets Total Assets Non - Interest Bearing Deposits Interest Bearing Deposits Total Deposits Borrowings Other Liabilities Stockholders’ Equity Liabilities and Stockholders’ Equity $ 13,440 292,208 611,221 19,906
Slide 20: Elaine A Woodland, President and CEO
Elaine A Woodland President and CEO This presentation contains certain forward - looking statements, which are included pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 , and reflect management’s beliefs and expectations based on information currently
Slide 21: Improve Net Income
Improve Net Income • Top Line Revenue Growth • Control Expenses • Allocation of Resources
Slide 22: Loan Growth
Loan Growth • Overall Loan Growth exceeded 8% • Did not weaken our credit standards • The 5 C’s of Credit • Character • Capacity • Capital • Conditions • Collateral
Slide 23: A Loan is Not ALONE
A Loan is Not ALONE Application • Commercial Loan Officers, Mortgage Loan Consultant, Branch Managers, Keystone Bankers Underwriting • Credit Administration, Mortgage & Consumer Loan Underwriters & Processors • Ordering & reviewing appraisals, Flood Certifications, Income & Asset Verification, Envir
Slide 24: Loan Growth: Lehigh Valley LPO
Loan Growth • Lehigh Valley LPO opened for business May 7, 2018 at 559 Main St, Bethlehem • Staffed by two commercial loan officers and a Loan Assistant : • Michael Reis • 18 years in lending, all in Lehigh Valley • Michael Santiago • 28 years in financial services • 8 years lending in Lehigh Valley
Slide 25: Marketing Initiatives: Commercial Lenders
Marketing Initiatives Commercial Lenders
Slide 26: Marketing Initiatives: Mortgage Billboards
Marketing Initiatives Mortgage Billboards
Slide 27: Marketing Initiatives: Home Equity Ad
Marketing Initiatives Home Equity Ad
Slide 28: Marketing Initiatives: Direct Mail Campaign
Marketing Initiatives Direct Mail Campaign – Rewards Checking • Targeting areas where other banks are closing branches: • Shickshinny: PNC leaving Macanaqua & 2 Billboards • Plymouth: Wells Fargo leaving Plymouth • Dallas: BB&T leaving Shavertown
Slide 29: Marketing Initiatives: In-branch TVs
Marketing Initiatives Installed in - branch TVs for current and consistent marketing & messaging and sharing of the bank information in all 19 offices.
Slide 30: Customer Engagement
Customer Engagement • Did you know….we currently have 32,384 customers? • Provide superior customer service, not only in our eyes, but as our customers perceive our service • Customer Survey • Every new account opened (in person and online)
Slide 31: Customer Engagement: Products and Services
Customer Engagement • Right Products and Services • P riced competitively • Ease of doing business with us: • Website redesigned – by in house talent
Slide 32: Customer Engagement: Convenience Services
Customer Engagement • Convenience Services: • Card Valet • Online Banking & Bill Pay • Mobile App • Google/Apple Pay • Mobile Remote Deposit • Direct Deposit • eStatements • Debit Cards • Trust & Estate Planning • Telephone Banking and Clubs • Quarterly Newsletters
Slide 33: Control Expenses
Control Expenses • Expense Containment • Line Item Review of expenses – identify areas of improvement • Starting with the major categories • Review day to day process • Analyzing Healthcare expenses • Spend $ wisely to position us for future growth
Slide 34: RPRS: Existing Staff Training
RPRS Existing Staff • Training Initiatives – Provided over 2,770 hours of in - house on line training • Keystone Banker career pathing for frontline • C ombination of our LMS on line training • C lassroom training by our in - house experts • Compliance • Consumer Lending • Frauds & Scams • Products
Slide 35: RPRS
RPRS • Promotion from within all areas • PA Bankers graduates • Right level of staffing to position for growth
Slide 36: Management experience
Name/Title Overall Banking Experience Number of years with FKCB Prior Positions held at FKCB Prior Experience Elaine A. Woodland President and CEO 38 years 26 years Teller, CSR, Acctg Clerk, Commercial Loan Officer, Director of Lending, COO Credit Analyst, Credit Dept Manager, Commercial Lender Dian
Slide 37: 1973 Flashback
1973 Flashback
Slide 38: New Hires and OnBoarding
New Hires and OnBoarding • Hire the right person for the right seat • Ensure that new hires exhibit our Core Values • Dedicated to our Customer’s Needs • Be Accountable • Collaborative Team Player • Pro - Active Problem Solver • Be Positive, Fun and Optimistic
Slide 39: Making a Connection to our Communities
Making a Connection to our Communities Making a Connection • Connecting with Customers, Colleagues, Community, Self • Built on Foundation of our Core Values • Connect for Kindness – Four deliberate acts of Kindness • 100% participation of employees!
Slide 40: Making a Connection to our Communities: Results
Making a Connection to our Communities Results • Delivered 4 $1,000 checks to local food pantries • 2100 cans of non - perishable food items • Clothing and cleaning supplies • We connected with each other • Learned some valuable lessons about the importance of Kindness • W hether the acts were perfo
Slide 41: Connect for Kindness
Connect for Kindness Christ Episcopal Church Food Pantry Mountain Top Area Food Bank New Bethany Ministries Salvation Army Berwick The Hope Center Beyond Violence
Slide 42: Beyond Connect for Kindness
Beyond Connect for Kindness • Over 2000 volunteer hours – supporting non - profit agencies, attending school board & municipal meetings, participating in parades, civic clubs, homes shows, etc. • Denim Days fundraisers $3,853 to community non - profit agencies Making a Connection to our Communities
Slide 43: Community Involvement
Community Involvement • Community is in our name • Dedicated to supporting healthy communities • One the foundations of our philosophy is partnering with our customers & communities • It’s one of our Keystones • Focus on providing both traditional and innovative banking services, and financial solut
Slide 44: Community Involvement: Benton Flood Relief
Community Involvement Benton Flood Relief
Slide 45: Community Involvement: Reading at West Berwick Elementary
Community Involvement Reading at West Berwick Elementary
Slide 46: Community Involvement: ALS Walk
Community Involvement ALS Walk
Slide 47: Community Involvement: Dogs for the Big Dawg
Community Involvement Dogs for the Big Dawg
Slide 48: Community Involvement: Dogs for the Big Dawg
Community Involvement Dogs for the Big Dawg
Slide 49: Community Involvement: Berwick Little League Scoreboard
Community Involvement Dedication of the Scoreboard for Berwick Area Little League
Slide 50: Community Involvement: VA Luncheon
Community Involvement VA Luncheon Mountain Top American Legion
Slide 51: Community Involvement: Wilkes Barre Riverfest
Community Involvement Wilkes Barre Riverfest
Slide 52: Community Involvement: Pocono Chamber Business Card Exchange
Community Involvement Pocono Chamber Business Card Exchange
Slide 53: Community Involvement: Berwick High School Presents Beauty and the Beast
Community Involvement Berwick High School Presents Beauty and the Beast
Slide 54: Community Involvement: Education
Community Involvement • Community involvement extends into education • Financial Literacy • Pennsylvania Free Enterprise Week • Stock Market Game
Slide 55: Mission Statement
Mission Statement Our mission is to be the financial provider of choice of a broad selection of quality banking and related financial services, including trust services, to individuals, businesses, and households in the Bank’s service area and thereby deliver superior financial performance and value
Slide 56: Thank you for attending!
Thank you for attending!