First Bancorp · NASDAQ:FBNC
First Bancorp — Investor Presentation (June 2020)
30 slides from First Bancorp's investor presentation, Jun 17, 2020
Slide 1: June 2020 Bank Local
June 2020 Bank Local. LOCALFIRSTBANK.COM
Slide 2: Important Information: Forward Looking Statements
IMPORTANT INFORMATION FORWARD LOOKING STATEMENTS Information in this presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties that could cause actual results to differ materially, inc
Slide 3: Company Profile
COMPANY PROFILE* Bank Holding Company First Bancorp Subsidiary Bank First Bank Headquarters Southern Pines, North Carolina Established 1935 as Bank of Montgomery Assets $6.4 billion Loans $4.6 billion Deposits $5.0 billion Branches 101 in NC & SC Employees 1,098 full-time equivalent employees Rankin
Slide 4: Management Team – Diverse Background
MANAGEMENT TEAM – DIVERSE BACKGROUND Richard Moore, CEO, First Bancorp – Director since 2010/CEO since 2012 • Former Managing Director, Relational Investors, Investment advisor to some of the largest pension funds in the world • Former State Treasurer of North Carolina – oversaw more than $80 billio
Slide 5: Forbes & Fortune Recognitions
FORBES & FORTUNE RECOGNITIONS June 25, 2019 – Forbes - Best In-State Banks Recognition One of three banks recognized in North Carolina and the only one headquartered in the state. Based on customer survey on satisfaction and the following attributes: • Trust • Terms & Conditions • Branch Services •
Slide 6: Q1 2020 Highlights
Q1 2020 HIGHLIGHTS Percentages annualized where applicable Q1 2020 Q1 2019 CHANGE Net income $18.2 million $22.3 million -18.4% Provision for Loan Losses $5.6 million $0.5 million +1,018% EPS Common – Diluted $0.62 $0.75 -17.3% Return on Average Assets 1.18% 1.52% -34 bps Return on Average Common Eq
Slide 7: COVID-19 Update
COVID-19 Update As of May 28, 2020, all branch lobbies were re-opened • PPP Loans - 2,825 loans totaling $244.9 million at June 12, 2020 • Fees of approximately $10.5 million • Payment Deferrals – 1,497 loans totaling $786.8 million as of June 12, 2020 (17% of loans outstanding at 3/31/20) • 20% of
Slide 8: Q2 2020 Update
Q2 2020 UPDATE • In May, $220 million of securities were sold at a gain of $8.0 million • Securities sold were believed to be favorably impacted by historically low interest rates and Federal Reserve stimulus measures • Average yield sold was 2.35%, reinvestment at 1.64% • Overall securities portfol
Slide 9: Year Ended 2019
YEAR ENDED 2019 Percentages annualized where applicable 2019 2018 CHANGE Net income $92.0 million $89.3 million +3.1% EPS Common – Diluted $3.10 $3.01 +3.0% Return on Average Assets 1.53% 1.57% -4 bps Return on Average Common Equity 11.32% 12.27% -95 bps Return on Average Tangible Common Equity (1)
Slide 10: Total Stock Return – Periods Ended December 31, 2019
TOTAL STOCK RETURN – FOR THE PERIODS ENDED DECEMBER 31, 2019 140.0% 131.5% 120.0% 100.0% 82.3% 80.0% 60.0% 52.3% 40.0% 24.0% 23.9% 20.0% 11.7% 0.0% 1 Year Total Return 3 Year Total Return 5 Year Total Return First Bancorp Peer Index 10 Peer Index Source: S&P Global – Banks between $5-$10 billion in
Slide 11: Investing in Technology
INVESTING IN TECHNOLOGY . New bill pay system - March 2019 . New ATM fleet - Q1 2019 . New website - May 1, 2019 . New mortgage loan app-driven process - Q2 2019 . New person-to-person payment system (Zelle) - Q4 2019 . Online deposit account opening – major upgrade - Q4 2019 . New call center softw
Slide 12: Computer & Mobile Log-in Trends – 2016 to May 2020
Computer & Mobile Log-in Trends – 2016 to May 2020 January 2016 logins = 391,569 May 2020 logins = 1,447,553 12
Slide 13: Growth in Tangible Book Value (Common)
GROWTH IN TANGIBLE BOOK VALUE (COMMON) Price/Tangible Common Book Value 5 Year Increase of 63.5% $22.00 $21.09 $20.00 $17.94 $18.00 $16.00 $15.17 $13.75 $13.53 $14.00 $12.90 $12.00 $10.00 $8.00 13 03/31/15 03/31/16 03/31/17 03/31/18 03/31/19 03/31/20
Slide 14: North Carolina's Most Populous Markets
NORTH CAROLINA’S MOST POPULOUS MARKETS GREENSBORO WINSTON-SALEM RALEIGH ASHEVILLE GREENVILLE CHARLOTTE FAYETTEVILLE Housing Units per Square Mile WILMINGTON Less than 50 500 - 999 50 - 99 1,000 - 1,999 100 - 249 2,000 units or more 250 - 499 14
Slide 15: Investing in Growth Markets – Net Loan Growth
INVESTING IN GROWTH MARKET NET LOAN GROWTH January 1, 2016 – March 31, 2020 WINSTON-SALEM Forsyth County Triad $585 million GREENSBORO ASHEVILLE Guilford County Buncombe County RALEIGH Wake County Asheville MSA $575 million GREENVILLE Pitt County Charlotte MSA $239 million CHARLOTTE FAYETTEVILLE Mec
Slide 16: Net Interest Margin
NET INTEREST MARGIN 5.00% REPORTED CORE 4.50% 4.17% 4.07% 4.03% 4.08% 4.06% 4.06% 3.95% 3.93% 3.96% 4.00% 3.99% 3.91% 3.94% 3.95% 3.93% 3.89% 3.86% 3.82% 3.83% 3.50% 3.00% Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Net interest margin is calculated by dividing tax-equiva
Slide 17: Loan Yields
LOAN YIELDS STATED CORE 5.40% 5.16% 5.20% 5.13% 5.11% 5.03% 4.99% 4.96% 5.02% 5.00% 4.96% 4.93% 4.96% 4.98% 5.00% 4.80% 4.90% 4.90% 4.77% 4.81% 4.76% 4.60% 4.75% 4.40% 4.20% 4.00% Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Core loan yield excludes loan discount accretion
Slide 18: Cost of Funds
COST OF FUNDS COST OF FUNDS COST OF DEPOSITS 0.80% 0.66% 0.67% 0.66% 0.70% 0.63% 0.58% 0.60% 0.51% 0.56% 0.45% 0.50% 0.53% 0.54% 0.38% 0.53% 0.48% 0.40% 0.47% 0.40% 0.30% 0.34% 0.29% 0.20% 0.25% 0.10% 0.00% Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 18
Slide 19: Efficiency Ratio
EFFICIENCY RATIO Note: As computed and reported by S&P Global 75.00% 68.78% 70.00% 66.84% 65.00% 61.28% 60.00% 56.49% 55.28% 54.53% 55.00% 50.00% 45.00% 2015 2016 2017 2018 2019 Q1 2020 Approximately $20 million in overhead efficiencies realized from Carolina Bank and Asheville Savings Bank acquisit
Slide 20: Deposit Accounts – Open/Close Ratio
DEPOSIT ACCOUNTS – OPEN/CLOSE RATIO 1.60 1.50 1.50 1.40 1.40 1.43 1.40 1.29 1.30 1.19 1.20 1.10 0.99 1.00 0.95 0.88 0.90 0.90 0.87 0.80 0.70 0.60 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 First@Work Deposit Account – Introduced Mid-2018 20
Slide 21: Fee Income Growth & Expansion
Fee Income Growth & Expansion Revenue from Above Sources 2015 $5.1 million 2019 $24.6 million 21
Slide 22: Credit Cards: A Community Bank Differentiator
CREDIT CARDS: A COMMUNITY BANK DIFFERENTIATOR First Bank owns its own credit card $31 million in outstanding receivables • 87% increase since 12/31/15 Attractive rewards program • Combined debit card/credit card points • One of the few banks that offers debit card rewards $13.8 million in annual cre
Slide 23: North Carolina: A Great State for Business
NORTH CAROLINA: A GREAT STATE FOR BUSINESS North Carolina is currently the 9th most populated state – • Projected 8th by 2040 – and within 3% of 5th largest • 5th highest net increase in population from 2010-2017 • Projected to grow 29% over the next 20 years – 5th highest total growth • Apex – a su
Slide 24: Our Promise to Service Excellence
Our Promise to Service Excellence We help our customers realize their dreams by providing financial solutions and building trusted relationships.
Slide 25: Service Excellence Principles
SERVICE EXCELLENCE PRINCIPLES 25
Slide 26: Investment Thesis
INVESTMENT THESIS Bank that offers many of the product capabilities found in larger regional banks but delivers those services with a local community bank focus • Strong culture • Mobile Banking, Wealth Management, Trust Services, Credit Card, Treasury Services, Insurance, and Mortgage Banking Cente
Slide 27: Loan Portfolio at 3/31/20
LOAN PORTFOLIO: AT 3/31/20 LOAN PORTFOLIO AMOUNT % of Total Consumer & Other 73 C&D C&D $ 590 13% 2% 590 13% Non Owner- Occupied CRE Multifamily 175 4% 924 Multifamily 20% 175 4% 1-4 Family 1,103 24% HELOC 332 7% 1-4 Family C&I 338 8% Owner-Occupied 1,103 CRE 24% 871 Municipalities 147 3% 19% Owner-
Slide 28: Deposit Portfolio at 3/31/20
DEPOSIT PORTFOLIO: AT 3/31/20 Avg Interest Brokered LOAN PORTFOLIO AMOUNT % of Total Rate – Q1 Time < $10086 2020 246 2% 5% Time > $100 Noninterest Checking $ 1,581 31% 0.0% 553 11% Noninterest Checking 1,581 Interest Checking 923 18% 0.18% 31% Savings 431 Money Market 1,225 24% 0.56% 9% Savings 431
Slide 29: Valuation: Price to Tangible Common Book Value
VALUATION: PRICE TO TANGIBLE COMMON BOOK VALUE Closing stock price on June 12, 2020 = $24.92 • Price to tangible book – 1.18x • Based on 3/31/20 tangible book value - $21.09 Price / Tangible Common Book Value 1.8x 1.57x 1.35x 1.3x 1.26x Median = 1.19x 1.2x 1.16x 1.18x 1.18x .91x .73x .76x HTBI SLCT
Slide 30: Valuation: Price to Earnings
VALUATION: PRICE TO EARNINGS Price to Earnings • Based on SNL Mean EPS 2020 Estimate of $2.15, the FBNC price to earnings ratio is 11.6x based on June 12, 2020 closing price for FBNC stock of $24.92. Price / 2020 Consensus EPS 23.1x 18.6x Median =14.1x 16.7x 15.0x 15.1x 15.3x 13.2x 12.2x 12.3x 11.6x