Independent Bank Corp. · NASDAQ:INDB
Independent Bank — Investor Presentation (September 2009)
28 slides from Independent Bank's investor presentation, Sep 18, 2009
Slide 1: Investor Presentation September 2009
Investor Presentation September 2009
Slide 2: Who We Are
2 Who We Are Main Sub: Rockland TrustMarket: Eastern MassachusettsLoans: $3.4 BDeposits: $3.3 B$AUM: $1.2 BEquity: $0.4 BNASDAQ: INDB
Slide 3: Key Messages
3 Key Messages Business lines performing wellGenerating robust loan/core deposit volumesGaining customers from industry falloutBuilding franchise value via market extensionWe're more than a traditional community bankDisciplined risk management cultureStrong tangible and regulatory capital
Slide 4: Company Footprint
4 Company Footprint 71 Branches 3 Mortgage Banking Centers 12 Commercial Banking Centers 4 Investment Management CentersBusiness generation extends beyond S.E. Mass. footprint Source: SNL Financial; Deposit/Market Share data as of June 30, 2008 including pending transactions. (Includes Credit Unions
Slide 5: Strong Organic Growth in Priority Portfolios
5 2007 2008 1H '09 A 363 B 428 C 288 2007 2008 1H '09 A 318 B 401 C 178 Strong Organic Growth in Priority Portfolios (Millions) 6/09 vs. 6/08(ex acquis) 6/09 vs 3/09(ex acquis) 10% 15% Comm'l Loan Originations Consumer Loan Originations(Resi's & Home Eq.) +26% +18% Comm'l Loan $ Bal. Home Equity $ B
Slide 6: Repositioning the Balance Sheet
6 Repositioning the Balance Sheet Home Eq/Oth. Consumer Loans Consumer-Resi's & Auto Loans Securities & ST Investments Commercial Loans 0.11 0.25 0.27 0.37 Home Eq./Oth. Consumer Loans Consumer - Resi's & Auto Loans Securities & ST Investments Commercial Loans 0.12 0.18 0.17 0.53 2005 $2.8 B 2Q 2009
Slide 7: Improved Funding Mix - Lower Cost Deposits
7 Improved Funding Mix - Lower Cost Deposits Savings/ Now C/D's Money Market Demand Deposits 0.3 0.29 0.2 0.21 TOTAL DEPOSITS 2Q 2009$3.3 BAVERAGE COST - TOTAL DEP: 1.03% Very Focused On Containing Deposit Costs Core deposits ?11% annual. vs 1Q09Core Deposits: 71%No broker CD's
Slide 8: Reducing Below-Hurdle Assets
8 Reducing Below - Hurdle Assets Indirect Consumer Loans $ Millions 2005 2006 2007 Q1 '08 Q2 '08 Q3 '08 2008 2Q09 274 218 166 147 137 141 135 111 Shedding Non-Relationship Assets Accounted for 30% of total 2008 net chargeoffs
Slide 9: Avoided Industry Pitfalls
9 Avoided Industry Pitfalls No outsized credit chargesNo subprime exposureNo Fannie or Freddie exposureNo loss ($P&L) quartersNo dilutive common equity raisingNo dividend cutsModest securities impairment
Slide 10: Disciplined Credit Culture
10 Disciplined Credit Culture Longstanding underwriting conservatismLoan portfolio based within footprintIn-depth knowledge of local marketsNo wholesale originations of any loan typeWorkout team in place for 16 years
Slide 11: Asset Quality - No Drama
11 2007 2008 1Q09 2Q09 3.1 6.2 3.6 1.9 Asset Quality - No Drama Net Charge Offs ($ Millions) NPL's ($ Millions) Dec '07 Dec '08 1Q09 2Q09 7.6 26.9 29 31.5 0.37% 1.01% 1.08% 0.93% Loss Rate NPL % Rising with weakening economy Losses well-contained 16bp 24bp 53bp* 23bp * *annualized
Slide 12: Commercial Real Estate Portfolio $1.7 Billion
12 Commercial Real Estate Portfolio $1.7 Billion
Slide 13: Commercial Real Estate Portfolio
13 Commercial Real Estate Portfolio
Slide 14: Strong Loan Loss Reserves
14 Strong Loan Loss Reserves Reserves a Healthy Multiple of Loss Rate Reserves/Loans* Net Chargeoffs/Avg. Loans * Excludes loans acquired at fair value in 2Q09
Slide 15: Strong Capital
15 Strong Capital Total Risk-Based % Tier 1 Leverage % Q4 '05 Q4 '06 Q4 '07 Q1 '08 Q2 '08 Q3 '08 4Q08 2Q09 0.0771 0.0758 0.0805 0.0758 0.0802 0.0855 0.0761 0.0769 4Q08 2Q09 0.119 0.1155 Tangible Capital % Q4 '05 Q4 '06 Q4 '07 Q1 '08 Q2 '08 Q3 '08 4Q08 2Q09 0.057 0.058 0.063 0.063 0.059 0.0691 0.054
Slide 16: Attentive to Shareholder Returns
16 Attentive to Shareholder Returns 2003 2004 2005 2006 2007 2008 1H'09 East 0.52 West 0.56 North 0.6 0.64 0.68 0.72 0.36 *declared Cash Dividends* Per Share
Slide 17: 2009 Financial Results
17 2009 Financial Results Reported Earnings Operating Earnings Fundamentals in Excellent Shape $Mil Diluted EPS. $0.32 $(0.19) $0.33 $0.33 .......Operating Earnings...... Includes Special FDIC Assessment Securities impairment (OTTI)- Accrued CPP preferred div. Excludes M&A charges CPP repayment char
Slide 18: Net Interest Margin Holding Up Despite Difficult Conditions
18 Net Interest Margin Holding Up Despite Difficult Conditions
Slide 19: Wealth Management - Strategic Priority
19 2005 2006 2007 Q1 '08 Q2 '08 Q3 '08 Q3 '08 YTD 2008 1H '09 2Q09 YTD 5.3 6.1 8.1 2.7 11.1 3.1 2.8 8.6 5 2.7 5 4Q05 4Q06 4Q07 4Q08 1Q09 2Q09 680 816 1289 1124 1066 1152 Fee Based Revenues - Steady and Growing Source 109% Assets Under Management($ Millions) Wealth Management Revenue($ Millions) Weal
Slide 20: Acquisition Criteria
20 Acquisition Criteria Strategic FitLow RiskAccretive to EarningsOpportunistic/TargetedComplementary Products
Slide 21: Acquisition of Benjamin Franklin Bancorp
21 Acquisition of Benjamin Franklin Bancorp. (BFBC) Strategic Rationale Contiguous expansion into highly attractive marketsGreater access to Boston's western suburbsExcellent demographics and higher densityAcquiring a healthy, well-run, growing community bankBuilding franchise value - solid loan and
Slide 22: INDB/BFBC Footprint
22 INDB/BFBC Footprint INDB: 60 Branches BFBC: 11 Branches BFBC 12/31/08 ($MM)Deposits: $653Loans: $689Equity: $110
Slide 23: Attractive Demographics
23 Attractive Demographics Source: SNL Financial MA INDB BFBC A 68.176 B 70.9 C 85.7 C Median HH Income ($ Thou.)2008 Total Population (Thou.)2008 INDB/BFBC Proforma MA A 3430 B 6518 C
Slide 24: Building Franchise Value - Disciplined Acquisitions
24 Building Franchise Value Disciplined Acquisitions $336mm Deposits$135mm Loans16 Branches Deal Value: $40mm12% Dep. Premium FleetDivest. Aug '00 $158mm Assets$137mm Deposits4 Branches Deal Value: $37mm11% Dep. Premium FalmouthBancorpJul '04 IRS Sec. 1031Like-Kind ExchangeServices Deal Value: N/ACa
Slide 25: Recent Positive Developments
25 Recent Positive Developments Ben Franklin integration completedSystems convertedFrontline staff retainedBalance sheet de-leveredTreasury CPP funds fully repaid ($78MM)Among 1st in country to do soDid not need to raise replacement equityAwarded $50MM in federal tax creditsNew Markets Tax Credit Pr
Slide 26: Our GamePlan in Very Challenging Environment
26 Our GamePlan in Very Challenging Environment Expand business with new and existing customersHit the ground running with Ben Franklin customersFulfill local credit needs while maintaining disciplineCultivate strong deposit base with rational pricingContinue to capitalize on competitive dislocation
Slide 27: INDB - Investment Merits
27 INDB - Investment Merits Building franchise value in attractive marketsStrong on-the-ground business volumesOperating platform that can be leveraged furtherBalance sheet equipped to deal with severe environmentGrounded management team - does not "reach for earnings"Aligned with shareholders - ins
Slide 28: Forward-looking statements and contact
Statements contained in this presentation that are not historical facts are "forward- looking statements" that are subject to risks and uncertainties which could cause actual results to differ materially from those currently anticipated due to a number of factors, which include, but are not limited
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