Horizon Bancorp, Inc. · NASDAQ:HBNC
Horizon Bancorp — Merger or Acquisition (May 2021)
16 slides from Horizon Bancorp's merger presentation, May 25, 2021
Slide 1: Extension of Low-Cost Deposit Franchise with Acquisition of 14 Michigan Branches
Exhibit 99.2 Extension of Low-Cost Deposit Franchise with Acquisition of 14 Michigan Branches INVESTOR PRESENTATION | MAY 2021 ® E X C E P T I O N A L S E R V I C E • S E N S I B L E A D V I C E Exhibit 99.2 Extension of Low-Cost Deposit Franchise with Acquisition of 14 Michigan Branches INVESTOR PR
Slide 2: Important Information: Forward-Looking Statements
Important Information Forward-Looking Statements This presentation may contain forward-looking statements regarding the financial performance, business prospects, growth and operating strategies of Horizon. For these statements, Horizon claims the protections of the safe harbor for forward-looking s
Slide 3: Branch Acquisition Summary
Branch Acquisition Summary 14 branches, ~$976M of deposits and ~$278M of loans 1.75% premium on deposits with 14 TCF National Bank branches in Michigan Attractive Pricing 0.08% average cost of deposits, expected to further reduce HBNC’s total deposit cost, which Low-Cost Core Deposits was an average
Slide 4: Logical Market Extension
Logical Market Extension Charlevoix Otsego 14 Branches in 11 Counties WISCONSIN Crawford Logical extension of Horizon’s low-cost core deposit franchise Wexford in Michigan to further enhance already low-cost funding Roscommon Missaukee capability to support overall growth Arenac MICHIGAN Mecosta Are
Slide 5: Acquiring Branches in Counties
Acquiring 14 Branches in 11 Counties Deal takes Michigan up to 35% of deposits and 45% of loans* Average Branch Size of $69 Million Arenac County Newaygo County • 220 S. Main Street, Standish • 211 West Main Street., Fremont • 144 W. Huron Road, Au Gres Otsego County Charlevoix County • 521 W. Main
Slide 6: Experienced and Successful Integrator
Experienced and Successful Integrator th Branch transaction will be the bank’s 15 acquisition since ‘02 Experienced internal operations and integration team Three bank owned and operated call centers to be fully staffed and open extended hours to support integration 2014 - 2021 st • 1 Mtg. • Bargers
Slide 7: Low-Cost Core Deposit Franchise Enhanced with New Branches to be Acquired
Low-Cost Core Deposit Franchise Enhanced with New Branches to be Acquired 1Q21 Average Deposit Cost* HBNC Acquiring Pro Forma Non-interest bearing 0.00% 0.00% 0.00% Interest bearing 0.10% 0.03% 0.09% (excluding CDs) Time Deposits (CDs) 1.00% 0.50% 0.92% Total Deposits 0.21% 0.08% 0.18% Pro Forma HBN
Slide 8: Mortgage, Consumer & Small Biz Loans
Mortgage, Consumer & Small Biz Loans Completed extensive due diligence on performing portfolio 1Q21 Average Yield HBNC Acquiring Pro Forma Total Loans 4.39% 4.22% 4.38% HBNC Pro Forma Mortgage Mortgage Held For Sale, Held For Sale, Warehouse, Warehouse, 0% 0% 7% 7% Acquiring Consumer, Consumer, 18%
Slide 9: Fit with Low-Cost Operating Model
Fit with Low-Cost Operating Model • Low operating cost of acquired branches reduces efficiency ratio of 57.0% to 54.6%, or 55.4%* adjusted Efficiency Ratio 60.0% 59.0% 58.0% 57.0% 56.0% 55.0% 54.0% 53.0% 52.0% 1Q21 1Q20 2Q20 3Q20 4Q20 1Q21 Pro Forma* Efficiency Ratio 58.8% 56.2% 55.6% 57.5% 57.0% 54
Slide 10: Bank and Holding Company Capital Impact of Deal
Bank and Holding Company Capital Impact of Deal • $60.0 million in Holding Company cash down-streamed to the Bank • Projected earnings would increase Holding Company TCE/TA ratio to 8%* by the middle of 2022 Holding Company Capital Ratios Total Capital Ratio (%) TCE / TA (%)* Leverage Ratio (%) Tier
Slide 11: Accretion Upside of Liquidity Deployment
Accretion Upside of Liquidity Deployment • Expected to be 17.1% accretive to EPS in 2022, the first full year after closing, with conservative assumptions including ~5.0% loan growth and ~18% deposit runoff/ attrition from close until year end 2022 • Excess liquidity deployed into securities with an
Slide 12: Appendix
Appendix ® 12 E X C E P T I O N A L S E R V I C E • S E N S I B L E A D V I C E Appendix ® 12 E X C E P T I O N A L S E R V I C E • S E N S I B L E A D V I C E
Slide 13: Footnote Index: Use of Non-GAAP Financial Measures
Footnote Index Slides 14-16 Use of Non-GAAP Financial Measures • Certain information set forth in the presentation materials refers to financial measures determined by methods other than in accordance with GAAP. Horizon believes these non-GAAP financial measures are helpful to investors and provide
Slide 14: Footnote Index: Cost of Deposits
Footnote Index Three Months Ended March 31, December 31, 2021 2020 Total deposit interest expense as reported $ 2,343 $ 2,718 Average interest bearing deposits 3,524,103 3,450,824 Annualized total deposit interest expense as a percentage of average interest bearing deposits ( Cost of Interest Bearin
Slide 15: Footnote Index: Efficiency Ratio and Adjusted Efficiency Ratio Reconciliation
Footnote Index Non-GAAP Calculation and Reconciliation of Efficiency Ratio and Adjusted Efficiency Ratio (Dollars in Thousands, Unaudited) Three Months Ended March 31, March 31, December 31, September 30, June 30, March 31, 2021 2021 2020 2020 2020 2020 (Pro Forma) Non-GAAP Calculation of Efficiency
Slide 16: Footnote Index: Tangible Common Equity to Tangible Assets Reconciliation
Footnote Index Non-GAAP Reconciliation of Tangible Common Equity to Tangible Assets Ratio (Dollars in Thousands, Unaudited) Holding Company Bank June 30, March 31, June 30, March 31, 2021 2021 2021 2021 (Pro Forma) (Pro Forma) Tangible Common Equity Total stockholders' equity $ 697,946 $ 689,379 $ 7