Slide 1: Unity Bancorp
w Unity BANCORP 6/30/15 NASDAQ UNTY
Slide 2: Forward-looking statements and company snapshot
This presentation may contain forward-looking statements with respect to Unity Bancorp’s financial condition, results of operations and business. Do not unduly rely on forward-looking statements. Forward-looking statements can be identified by the use of words such as “may,” “should,” “will,” “could
Slide 3: Company Snapshot
+ Founded September 16, 1991 + Headquartered in Clinton, New Jersey + Approximatdy $1 Obillion in assets and $815 millionin deposits + Unity Bank provides financial services toretal, comorate and mall bsiness customers though ity 15 rata service offices located in Hunterdon, Midslasen, Someret, Unio
Slide 4: Bank Franchise
Bank Franchise .Hunterdon County, NJ: Clinton, Flemington, Whitehouse .Middlesex County, NJ: Edison, Highland Park, Middlesex, South Plainfield .Somerset County, NJ: North Plainfield, Somerset .Union County, NJ: Linden, Scotch Plains, Union .Warren County, NJ: Phillipsburg, Washington .Northampton C
Slide 5: Attractive Market Area
Attractive Market Area .High household income in our market counties relative to the State of New Jersey and the nationwide medians .State of New Jersey ranks 2nd in the nation in median household income, 4th in per capita income, and 2nd in population density .With respect to median household incom
Slide 6: Strategic Goals
To grow our business relationships by being a responsive bank, providing excellent service with flexible terms and conditions – 10% loan growth .Expand the Mortgage Division – Target 15% growth rate in purchased transactions .Expansion of SBA Division – Increase 7A Volume to $30 million .Growth in c
Slide 7: Core Values
Core Values
Slide 8: Senior Management Team
Senior Management Team James A. Hughes, CPA .President and Chief Executive Officer .Joined the company in 2000 .27 years banking experience .Previously employed at Summit Bancorp .Audit manager with KPMG, L.L.P. John J. Kauchak .Chief Operating Officer .Joined the company in 1996 .44 years banking e
Slide 9: Engaged Board of Directors
Engaged Board of Directors .David Dallas, Chairman of the Board, and Robert Dallas, Board Member, both founding members of the Bank .Average tenure of Board Members is 15 years .Diverse experience including financial industry, medical professionals, university professional and business ownership .Di
Slide 10: Recent Financial Performance
Recent Financial Performance a
Slide 11: Assets, Loans, Deposits and Equity
2013Y2014Y2Q2015Assets921.1$ 1,008.8$ 1,024.3$ Total Loans678.7 761.8 821.7 Deposits738.7 794.3 815.4 Total Equity57.2 70.1 73.7
Slide 12: Loan Portfolio Composition
$ 283.1 $ 301.5 $ 363.3 $ 401.9 $ 428.3 $ 134.1 $ 132.1 $ 182.1 $ 220.9 $ 243.3 $ 127.0 $ 107.0 $ 87.2 $ 79.9 $ 80.2 $ 48.5 $ 46.4 $ 46.1 $ 59.1 $ 69.9 $ 592.6 $ 587.0 $ 678.7 $ 761.8 $ 821.7 $- $100.00 $200.00 $300.00 $400.00 $500.00 $600.00 $700.00 $800.00 $900.002011Y2012Y2013Y2014Y2Q2015Commerci
Slide 13: Loans by Geography
$ 306.7 $ 63.7 $ 40.5 $ 52.1 $ 427.1 $ 25.7 $ 34.3 $ 21.4 $- $50.00 $100.00 $150.00 $200.00 $250.00 $300.00 $350.00 $400.00 $450.00New JerseyNew YorkPennsylvaniaOther20072Q2015
Slide 14: Mortgage Growth
Mortgage Growth $26.8 $23.3 $65.3 $91.1 $49.7 $52.6 $110.3 $88.4 $38.7 $37.3 $79.4 $133.6 $153.7 $129.8 $87.0 $- $20.00 $40.00 $60.00 $80.00 $100.00 $120.00 $140.00 $160.00 $180.002011Y2012Y2013Y2014Y2015 YTDPurchasesRefinances
Slide 15: NPLs / Loans
NPLs / Loans 1.68%1.51%1.49%1.16%1.08%0.99%0.56%0.47%0.45%0.40%2.67%2.07%1.96%1.61%1.48%0.00%0.50%1.00%1.50%2.00%2.50%3.00%2Q20143Q20144Q20141Q20152Q2015Nonperforming LoansTDRs
Slide 16: Deposit Composition
$ 383.4 $ 409.4 $ 397.3 $ 429.2 $ 402.3 $ 159.4 $ 125.0 $ 205.4 $ 212.3 $ 237.8 $ 101.2 $ 114.4 $ 136.0 $ 152.8 $ 175.3 $ 644.0 $ 648.8 $ 738.7 $ 794.3 $ 815.4 $- $100.00 $200.00 $300.00 $400.00 $500.00 $600.00 $700.00 $800.00 $900.002011Y2012Y2013Y2014Y2Q2015Interest-bearing DDA & SAV depositsTotal
Slide 17: Income Statement Summary
2014YTD2015YTDNet Interest Income$14.6$16.4Provision for Loan Losses1.20.2Noninterest Income 3.23.5Noninterest Expense 12.413.1Provision for Income Taxes1.42.2Net Income$2.8$4.4Diluted Earnings Per Share$0.37 $0.51 Return on Average Assets0.64 %0.92 %Return on Average Equity9.70 12.23 Net Interest M
Slide 18: Net Interest Income and Net Interest Margin
Despite the interest rate environment, we have focused on growing revenue and protecting the net interest margin $29.0$27.4$27.4$30.1$14.6$16.43.76%3.62%3.53%3.53%3.53%3.67%1.00%1.50%2.00%2.50%3.00%3.50%4.00% $- $5.00 $10.00 $15.00 $20.00 $25.00 $30.00 $35.00 $40.002011Y2012Y2013Y2014Y6/30/2014 YTD6
Slide 19: Noninterest Income
Noninterest Income (excludes gains [losses] on securities) $5.4$6.8$6.2$6.2$2.8$3.515.47%19.46%18.26%16.98%15.70%17.60%0.00%2.00%4.00%6.00%8.00%10.00%12.00%14.00%16.00%18.00%20.00% $- $1.00 $2.00 $3.00 $4.00 $5.00 $6.00 $7.00 $8.00 $9.002011Y2012Y2013Y2014Y6/30/2014 YTD6/30/2015YTDNoninterest Income
Slide 20: Noninterest Income Breakdown
6/30/2014 YTD6/30/2015YTDBranch fee income$718$719Service and loan fee income580762Gain on sale of SBA loans held for sale, net337363Gain on sale of mortgage loans, net5531,031BOLI income192189Net security gains 37828Other income408442Total noninterest income$3,166$3,534
Slide 21: Noninterest Expense
Noninterest Expense Note: 6/30/2014 YTD and 6/30/2015 YTD ratios are annualized. $24.5$24.3$24.0$24.7$12.4$13.23.00%3.02%2.88%2.69%2.78%2.74%0.00%2.00% $- $5.00 $10.00 $15.00 $20.00 $25.00 $30.00 $35.002011Y2012Y2013Y2014Y6/30/2014 YTD6/30/2015YTDNoninterest ExpenseNoninterest Expense/Average Assets
Slide 22: Noninterest Expense Breakdown
6/30/2014 YTD6/30/2015YTDCompensation and benefits$6,340$6,952Occupancy1,2791,273Processing and communications1,1791,210Furniture and equipment735795Professional services458478Loan costs344382OREO expenses342103Deposit insurance349333Advertising438525Other expenses9391,103Total noninterest expense$1
Slide 23: Quarterly Diluted Earnings per Share
Diluted Earnings per Share $0.20 $0.24 $0.20 $0.23 $0.28 $- $0.05 $0.10 $0.15 $0.20 $0.25 $0.302Q20143Q20144Q20141Q20152Q2015
Slide 24: Annual Diluted Earnings per Share
Diluted Earnings per Share $0.13 $0.34 $0.53 $0.81 $0.51 $- $0.10 $0.20 $0.30 $0.40 $0.50 $0.60 $0.70 $0.80 $0.902011Y2012Y2013Y2014Y6/30/2015YTD
Slide 25: Book Value per Share
Note: 2013 reflects redemption of TARP preferred stock and the associated warrant. $7.04 $7.42 $7.35 $8.18 $8.57 $6.00 $6.50 $7.00 $7.50 $8.00 $8.50 $9.002011Y2012Y2013Y2014Y2Q2015
Slide 26: Tangible Book Value per Share
$6.40 $6.24 $7.66 $9.43 $9.79 $3.00 $4.00 $5.00 $6.00 $7.00 $8.00 $9.00 $10.00 $11.002011Y2012Y2013Y2014Y6/30/2015
Slide 27: Capital Ratios vs FDIC-Insured Commercial Banks
Unity Bancorp, Inc. FDIC-Insured Commercial Banks * 2013 Capital Ratios reflect the redemption of the TARP preferred stock and the associated warrants. 4.00%6.00%8.00%10.00%12.00%2011Y2012Y2013Y2014YLeverage3.00%6.00%9.00%12.00%15.00%18.00%2011Y2012Y2013Y2014YTotal Risk-Based Capital4.00%8.00%12.00%
Slide 28: Investment Highlights
Knowledgeable and experienced management team Attractive branch franchise . Improving bank fundamentals Positioned for economic rebound Insider ownership Consolidation of NJ Community Banks
Slide 29: Data Sources
UnityTree_5in.jpgThe previous slides contained data from the following sources: . FDIC-Insured Commercial Banks: . Obtained from FDIC.gov Quarterly Banking Profile. SNL