Bar Harbor Bankshares, Inc. · AMEX:BHB
Bar Harbor Bankshares — Q2 2020 Earnings Presentation
23 slides from Bar Harbor Bankshares's earnings presentation, Jul 28, 2020
Slide 1: Second Quarter 2020 Earnings Presentation
Second Quarter 2020 Earnings Presentation July 28, 2020
Slide 2: Company Overview
2 Company Overview (NYSE American: BHB) All financial data as of June 30, 2020 except 1Market Data, which is as of July 22, 2020 and 2Capital ratios which are as of March 31, 2020 3Assets and loans include a net $127.0 MM in Paycheck Protection Program (PPP) loans Stock Price $20.75 Market Cap (MM's
Slide 3: Second Quarter 2020 - Highlights
3 Second Quarter 2020 - Highlights • 18% annualized commercial loan growth for Q2 2020, CRE at 14% and C&I at 30%, excluding PPP (Paycheck Protection Program) • 32% annualized growth in non-maturity deposits for Q2 2020, excluding balances related to PPP loans • 11% QTD annualized growth in tangible
Slide 4: Strategic Objectives
4 Strategic Objectives To be one of the most profitable banks headquartered in New England Focus on the core bank: core commercial banking business, core funding, core earnings Increase sources of fee income via Trust, Treasury Management and Mortgage Banking Continued commitment to an exceptional r
Slide 5: Management Team
5 Management Team Executive Background Curtis C. Simard • Joined as President and CEO of Bar Harbor Bankshares and Bar Harbor Bank & Trust in June 2013 President and CEO • Served as Managing Director of Corporate Banking for TD Bank and various management positions at Citizens Financial Group Joseph
Slide 6: Company History
6 Company History 1 Part of the Balance Sheet Optimization Strategies executed in 2019 was the refinancing of existing Bar Harbor Bank & Trust debt. Bar Harbor Bank & Trust issued subordinated sub debt to replace these borrowings. Bar Harbor Bank & Trust issued their subordinated debt at a 4.625% co
Slide 7: Markets we Serve: Deposit Market Share
7 Markets we Serve: Deposit Market Share Source: SNL / S&P Market Intelligence Rank Financial Institution Name Total Branches Total Deposits (000's) Market Share 1 Toronto-Dominion Bank 42 $3,867,684 10.1% 2 Camden National Corporation 58 $3,581,756 9.4% 3 Bangor Bancorp, MHC 59 $3,488,716 9.1% 4 Ke
Slide 8: Profitability Metrics
8 Profitability Metrics Core ROAA Net Interest Margin Core ROAE Efficiency Ratio 0.91% 0.86% 0.96% 0.80% 0.70% 2020Q2 2020Q1 2019Q4 2019Q3 2019Q2 3.00% 3.06% 2.95% 2.75% 2.65% 2020Q2 2020Q1 2019Q4 2019Q3 2019Q2 8.52% 7.71% 8.81% 7.36% 6.57% 2020Q2 2020Q1 2019Q4 2019Q3 2019Q2 60.67% 64.82% 62.56% 65.
Slide 9: Strengthening of the Balance Sheet
9 Strengthening of the Balance Sheet Liquidity Interest Rate Risk (IRR) Positioning & Management Capital • Increased balance sheet liquidity reflecting significant wholesale borrowing capacity (FHLB and Brokered CD Market) as well as restructured investment portfolio • Continue to maintain and test
Slide 10: Focus on Non-Interest Income Growth
10 Focus on Non-Interest Income Growth • Optimized existing sources and executed against new initiatives to create other sources ‒ Substantial growth and diversification of non-interest income YTD compared to Q2 2019 YTD • Wealth Management and Financial Services ‒ Bar Harbor Financial Services ‒ Tw
Slide 11: Deposit Portfolio Overview
11 Deposit Portfolio Overview • Total deposits of $2.70 billion as of June 30, 2020 representing Year-over-Year deposit growth of 8.6%; 32% annualized growth in total non-maturity deposits, excluding balances related to PPP loans • Continued focus on growing NOW, Demand and other non-Time Deposits w
Slide 12: Loan Portfolio Overview
12 Loan Portfolio Overview • Total loans of $2.73 billion as of June 30, 2020 representing a 5.86% Y-o-Y increase, with C&I increasing by 51.4% Y-o-Y ‒ Excluding PPP loans, total loans increased 0.9% Y-o-Y with C&I loans increasing 10.7% • Yield on loans of 3.94% for the quarter ended June 30, 2020,
Slide 13: PPP, COVID Modified Loans & Loan Provisions
13 PPP, COVID Modified Loans & Loan Provisions Paycheck Protection Program Loans (PPP) • 1900 originations with a total principal balance of $131.5 MM and unearned fees of $5.3 MM • Average loan size of $70K, 1,722 loans =< $150K totaling $51.2 MM (39%) and 4 loans >= $2.0 MM totaling $10.2 MM (8%)
Slide 14: Focused on Credit Quality
14 Focused on Credit Quality 1Remaining loan categories include commercial construction / land development, Agricultural and Consumer, for a total of 0.50% as of Q2 2020, down from 0.81% of balances in those categories during Q4 2019 2Exposure includes available credit & derivative exposure • During
Slide 15: Asset Quality
15 Asset Quality 1NPAs/Assets excluding PPP loans is 0.45% for Q2 2020, 2Reserves / Loans excluding PPP loans is 0.63% for Q2 2020, 3NPLs/Loans excluding PPP loans is 0.54% for Q2 2020 NCOs / Avg. Loans NPAs / Assets1 Reserves / Loans2 NPLs / Loans3 0.02% 0.18% 0.08% 0.02% 0.03% 0.00% 0.10% 0.20% 0.
Slide 16: Well Capitalized Institution
16 Well Capitalized Institution Source: Company filings, calculated at holding company level. 8.6% 8.7% 8.1% 8.3% 11.6% 11.6% 10.6% 10.6% 12.4% 12.5% 11.4% 11.4% 13.9% 14.0% 13.6% 13.6% 7.9% 8.2% 7.6% 7.8% 0% 2% 4% 6% 8% 10% 12% 14% 2019Q2 2019Q3 2019Q4 2020Q1 Tier 1 Leverage Ratio Common Equity Tie
Slide 17: Investment Considerations
17 Investment Considerations • Focused on building franchise value • Deep and talented management team • Team, platform and strategy in place to generate efficient growth • Profitable and efficient business model • Clear vision to grow core loan/deposit business • Development and expansion of non-in
Slide 18: Legal Disclaimer
18 Legal Disclaimer Forward Looking Statements This presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements can be identified by words such as “believes,” “anticipates,” “expects,” “intends,” “targeted,
Slide 19: Appendix
Appendix
Slide 20: Historical Financial Performance
20 Historical Financial Performance Source: Company filings 2016Y 2017Y 2018Y 2019Y 2019Q2 2019Q3 2019Q4 2020Q1 2020Q2 Total Assets $1,755 $3,565 $3,608 $3,669 $3,688 $3,612 $3,669 $3,677 $3,780 Net Loans 1,119 2,473 2,476 2,626 2,564 2,562 2,626 2,620 2,713 Total Deposits 1,050 2,352 2,483 2,696 2,
Slide 21: Non-GAAP to GAAP Reconciliations
21 Non-GAAP to GAAP Reconciliations 1Assumes a marginal tax rate of 23.78% in 2019. A marginal tax rate of 23.87% was used in the first and second quarter of 2020. 2 Non-GAAP financial measure. 3 Efficiency ratio is computed by dividing core non-interest expense net of franchise taxes and intangible
Slide 22: Non-GAAP to GAAP Reconciliations (continued)
22 Non-GAAP to GAAP Reconciliations (continued) 1Assumes a marginal tax rate of 23.78% in 2019. A marginal tax rate of 23.87% was used in the first and second quarter of 2020. 2 Non-GAAP financial measure. 3 Efficiency ratio is computed by dividing core non-interest expense net of franchise taxes an
Slide 23: Interest Rate Risk Analysis
23 Interest Rate Risk Analysis On a quarterly basis, the company measures and reports NII and EVE at risk to isolate the change in income and value related solely to interest-earning assets and interest-bearing liabilities. The analysis below shows the impact of instantaneous parallel shifts in the
Bar Harbor Bankshares — Q2 2020 Earnings Presentation on 6ix