Flushing Financial Corporation · NASDAQ:FFIC
Flushing Financial — IPO Roadshow (December 2016)
34 slides from Flushing Financial's IPO roadshow presentation, Dec 5, 2016
Slide 1: Subordinated Notes Offering December 2016
Subordinated Notes Offering December 2016 Free Writing Prospectus Dated December 5, 2016 Filed pursuant to Rule 433 Registration Statement No. 333-195182
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation has been prepared by Flushing Financial Corporation (“Flushing Financial” or the “Company”) solely for informational purposes based on information regarding its operations, as well as information from public sources. This presentation has been prepared to assi
Slide 3: Safe Harbor Statement
Safe Harbor Statement This presentation may contain forward-looking statements with respect to the financial condition, results of operations, plans, objectives, future performance or business of the Company. Forward-looking statements are generally identifiable by the use of words such as “believe,
Slide 4: Non-GAAP Measures
Non-GAAP Measures Core Diluted EPS, Core ROAE, Core ROAA, tangible common stockholders’ equity and efficiency ratio are each non-GAAP financial measures used in this presentation. These non-GAAP financial measures adjust GAAP financial measures to exclude for net income, intangible assets, net gains
Slide 5: Terms of Proposed Subordinated Debt Offering
Terms of Proposed Subordinated Debt Offering Issuer: Flushing Financial Corporation (NASDAQ: FFIC) Security: Fixed-to-Floating Rate Subordinated Notes due 2026 Aggregate Principal Amount: $50 million to $75 million Credit Rating: Kroll Bond Rating BBB Term: 10 years Optional Redemption: Optional red
Slide 6: Flushing Financial Corporate Profile
Flushing Financial Corporate Profile Neighborhood bank, founded in 1929, offering a wide array of products and services for retail, business and government markets Deposits primarily from 19 branches in multi-cultural neighborhoods and iGObanking.com® Diversified loan portfolio with focus on multi-f
Slide 7: Ethnically Diverse Communities and Niche Focus
Ethnically Diverse Communities and Niche Focus Source: US Census Bureau 2014 American Community Survey; US Census Bureau 2012 Survey of Business Owners. Community Example: Queens New York metropolitan area Queens County is the most ethnically diverse area in the country Strategic focus on the ethnic
Slide 8: Deposit Market Share
Deposit Market Share1 1 Represents market share for zip codes serviced by Flushing Bank physical branches. Source: SNL Financial and FDIC. 2 Includes the iGObanking.com® internet branch with $392.6 million in deposits as of June 30, 2016.
Slide 9: 3Q16 Operating Results And Highlights
3Q16 Operating Results And Highlights ¹ Excludes effects of net gains/losses for financial assets and liabilities carried at fair value, other-than-temporary impairment charges, gains/losses on sale of securities, prepayment penalties on borrowings, gain on sale of buildings and certain non-recurrin
Slide 10: Steady Balance Sheet Trends
Steady Balance Sheet Trends ¹ At the period ended.
Slide 11: Historical Financial Highlights
Historical Financial Highlights ¹ See Appendix for reconciliation of non-GAAP and GAAP measures. ² Bank equity includes $2.2 million of holding company goodwill not held at the Bank. 3 As of and for the quarter ended. Annualized where appropriate.
Slide 12: ROAA And ROAE
ROAA And ROAE (%) ¹ 2Q16 ROAA and ROAE includes the $33.8 million pre-tax gain on sale of the former main office building. Source SNL Financial.
Slide 13: Net Interest Margin
Net Interest Margin (%) 1 Based upon current prepayment assumptions as of September 30, 2016. Source: SNL Financial. Continue to manage our funding costs and grow low cost (core) deposits Extended reach through introduction of remote deposit capture and online banking for business accounts in 2008 B
Slide 14: Strong Regulatory Capital Ratios
Strong Regulatory Capital Ratios Note: Prior to Feb. 2013, the Company was a unitary savings and loan holding company. As such, the Company was not subject to capital requirements. For the Company, Common Equity Tier I (CET I) for 2015 and 3Q16 amounted to 11.83% and 11.72%, respectively. For the Ba
Slide 15: Total Loan Portfolio Composition
Total Loan Portfolio Composition Strategic growth of multi-family mortgages and floating rate C&I loans since 2006 Repositioned net loan growth since the recent recession to reduce portfolio risk Re-entered higher yielding, non-owner occupied commercial real estate during 2015; 30% of 3Q16 originati
Slide 16: Managing Credit Risk with Strong Underwriting
Managing Credit Risk with Strong Underwriting Limited exposure to loans with LTV greater 75% which total $15.2MM with an average LTV of 76.8% 1 Excludes loans on underlying co-operative mortgages. Note: Data as of September 30, 2016. Conservative underwriting standards 3Q16 LTV on originated multi-f
Slide 17: Non-Owner Occupied CRE Loan Concentration
Non-Owner Occupied CRE Loan Concentration CRE Loan Concentration as a % of Capital Plus Reserve $1,904MM $1,983MM $2,038MM $2,205MM $2,533MM $3,049MM $3,363MM $1,954MM Construction Loans as a % of Capital Plus Reserve Note: Loan totals exclude deferred fees and costs.
Slide 18: Minimal Delinquencies on the Total Portfolio
Minimal 90 Day Delinquencies on the Total Portfolio – As a Percentage of Loans Originated by Year1 1 Calculated by dividing current 90 day delinquencies by total loans originated by vintage period. 2 Certain taxi medallion loans totaling $2.6 million. 3 One SBA Loan 75% guaranteed totaling $1.7 mill
Slide 19: Credit Quality of the Total Portfolio
Credit Quality of the Total Portfolio Net Charge-Offs to Average Loans Non-Performing Loans to Loans Source: SNL Financial.
Slide 20: Deposits and Funding
Deposits and Funding Built multi-channel deposit gathering capabilities Growing business deposits Extending funding to protect against higher rates $704.4MM of CDs repricing in the fourth quarter of 2016 and calendar year 2017 – at an average coupon rate of 1.19% Funding Growth ($MM) Improving Fundi
Slide 21: Funding Sources Composition
Funding Sources Composition As of 12/31/06 $2.6B As of 9/30/16 $5.4B
Slide 22: Managing Our Funding Costs
Managing Our Funding Costs Period Ending Maturing CDs ($MM) Coupon Rate Q4 2016 $106.0 1.32% 2017 $598.4 1.17% Funding Vehicle Cost Range CDs 0.15% - 1.25% Government deposits 0.15% - 0.65% Business NOW 0.45% - 1.00% Personal NOW 0.15% - 1.00% FHLB-NY borrowings can be used to extend maturity for in
Slide 23: Investment Portfolio – Sector Breakdown
Investment Portfolio – Sector Breakdown Well managed credit risk 61% government-sponsored entities Investment portfolio average credit rating of AA Low interest rate risk, as ~28% will reset, amortize or prepay within 12 months $6.4M of single issue trust preferred securities carried at 101 cents on
Slide 24: Sources of Bank Liquidity
Sources of Bank Liquidity The Bank has the ability to borrow an additional $1,000MM from the Federal Home Loan Bank Management limit of $500.0MM in available borrowing capacity at all times Securities available for collateral total $648MM Management limits of $20.0MM to $50.0MM depending on purpose
Slide 25: Sources of Holding Company Liquidity
Sources of Holding Company Liquidity Flushing Financial Corporation’s main source of liquidity is dividends from its subsidiary, Flushing Bank Dividend capacity to Flushing Financial Corporation from Flushing Bank is $39.3MM in retained earnings Manageable debt profile (all currently callable) Trust
Slide 26: Historical Interest Coverage
Historical Interest Coverage ¹ Bank equity includes $2.2 million of holding company goodwill not held at the Bank. Source: SNL Financial.
Slide 27: Pro Forma Capital Ratios
Pro Forma Capital Ratios ¹ Assuming $50 million and 90% downstreamed to Bank risk-weighted at 0%. ² See Appendix for calculation of tangible common equity (TCE) and tangible assets (TA). Note: Holding company and Bank level financial data used as of September 30, 2016. Source: SNL Financial, Company
Slide 28: Summary Well Positioned for Steady Growth
Summary Well Positioned for Steady Growth Well capitalized for growth Strength and depth of the executive management team with oversight by the Board of Directors Growing multi-family and C&I loan portfolio Well-managed credit culture Charge-offs below industry averages NYC Market represents signifi
Slide 29: Appendix
Appendix BEQFLUSHING 29
Slide 30: Executive Leadership Team
Executive Leadership Team Francis Korzekwinski SEVP, Chief of Real Estate 23 yrs. with Flushing 27 yrs. in Industry Maria Grasso SEVP, COO, Corporate Secretary 10 yrs. with Flushing 30 yrs. in Industry John Buran President, CEO and member of the Board of Directors 15 yrs. with Flushing 38 yrs. in In
Slide 31: Changes In Net Interest Income and Market Value
Changes In Net Interest Income and Market Value In compliance with all Board limits under all scenarios Note: Assumes a “Shock” scenario. Source: September 30, 2016 10Q.
Slide 32: Non-GAAP to GAAP Reconciliation
Non-GAAP to GAAP Reconciliation * Core diluted earnings per common share may not foot due to rounding. ** Ratios are calculated on an annualized basis.
Slide 33: Non-GAAP to GAAP Reconciliation
Non-GAAP to GAAP Reconciliation
Slide 34: Non-GAAP to GAAP Reconciliation
Non-GAAP to GAAP Reconciliation