Fidelity D & D Bancorp, Inc. · NASDAQ:FDBC
Fidelity D & D Bancorp — Shareholder Meeting (May 2015)
73 slides from Fidelity D & D Bancorp's shareholder meeting presentation, May 7, 2015
Slide 1: Welcome
Welcome
Slide 2: Net Income
6.8 Net Income (Dollars millions) $6.3 5.8 48 3.8 2.8 1.8 1.0 | “12. 13 Core, Net Income
Slide 3: Net Income Per Share
Net Income Per Share (Dollars millions) ‘10 ‘11 12 '13 ‘14
Slide 4: Assets
Assets (Dollars millions) 700 $702 675 650 625 610 570 530 490 450 410 370 istQ 4 12001 14 "15
Slide 5: Total Loans & Leases, Net
500 Total Loans & Leases, Net (Dollars millions) 470 455 440 425 410 395 380 365 350 $512 fi] i ee | ‘14
Slide 6: 2014 Loan Results
2014 Loan Results Net Loan Growth: 9% = 11% 27% Commercial Residential Consumer Indirect Dealer Fidelity
Slide 7: Slide 7
Slide 8: Deposits
Deposits (Dollars millions) 600 $602 590 550 535 520 505 490 475 460 445 430
Slide 9: 2014 Deposit Results
2014 Deposit Results 6% 12% 33% 9% Business Deposit Consumer Public Deposit Retail & Business Growth Checking Growth Growth Savings and MMDA Growth
Slide 10: Wealth Management Revenue
Wealth Management Revenue (Trust and Financial Services) (Thousands)
Slide 11: Total Past Due & Non Accrual %
Total Past Due & Non Accrual % 1.24 Mar June sep Dec Ma June Sep Dec Mar
Slide 12: Slide 12
Slide 13: Fidelity D & D Bancorp, Inc. Supplemental Financial Information
Fidelity D & D Bancorp, Inc. 2015 Annual Meeting of Shareholders Supplemental Financial Information Year ended December 31, 2014 and First Quarter 2015 Salvatore R. DeFrancesco, Jr., CPA, CCMA Treasurer and Chief Financial Officer May 5, 2015
Slide 14: Forward-looking Statements
Forward-looking Statements This presentation contains forward-looking statements that describe our future plans, strategies and expectations. Forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts, They often include words such as “be
Slide 15: Income Statement Summary
Income Statement Summary Dallars in Thousands except per share information Year-To-Date December 31, 2014 2013 Variance Net Interest Income $ 21,927 $ 20,885 $ 1,042 Provision for Loan Loss 1,060 2,550 (1,490) Net Interest Income after Loan Loss 20,867 18,335 2,532 Other Income. 7,354 10,541 (3,187)
Slide 16: Core Income Statement Proforma
Core Income Statement Proforma Dollars in Thousands except per share information Year-To-Date December 31, (Non-GAAP) 2014 2013 Variance Net Interest Income $ 21,927 $ 20,885 $ 1,042 Provision for Loan Loss 1,060 2,550 (1,490) Net Interest Income after Loan Loss 20,867 18,335 2,532 Other Income 6,75
Slide 17: Selected Financial Data
Selected Financial Data (unaudited, dollars in thousands except per share data) Twelve Months Ended Reconciliation of Non-GAAP Financial Measures Dee. 31, 2014 Dee. 31, 2013 Reported net income (GAAP) $ 6,352 $ 7122 Adjust: Gain on sale of securities, net (net of tax) (395) (2,091) Adjust: Prepaymen
Slide 18: Net Interest Margin
Net Interest Margin 4.50% 4.25% 4.00% oe 3.75% 3.80% = - 3.50% 3.89% 3.80% 3.80%) 3.75% 3.25% 3.00% 2.75% 2.50% + + + + + 1 2010 2011 2012 2013 2014 Years The UBPR peer group are all insured commercial banks having assets between $300 million and $1 billion —*— UBPR Peer Group D&D Bancorp, Inc.
Slide 19: Condensed Balance Sheet
Condensed Balance Sheet Dollars in Thousands December 31, December 31, | Twelve month 2014 2013 Variance Assets. Cash & cash equivalents $ 25851 $ 13,218] 12,633 Securities 97,896 97,423 473 Loans and Leases 516,661 479,061 37,600 Allowance for Loan Loss (9.173) (8,928) (245) Net Loans 507,488 470,1
Slide 20: Unaudited Income Statement Summary
Unaudited Income Statement Summary Dollars in Thousands except per share information Quarterly Year-over-year 1015 1a 14 Variance Net Interest Income $ 5607 $ 5,295 § 312 Provision for Loan Loss 150 300 (150) Net Interest Income after Loan Loss 5457 F995 462 Gain on sale of securities $ 2 $ 207 (205
Slide 21: Net Interest Margin
Net Interest Margin 4.25% 3.79% 3.79% 3.78% 3.75% 3.68% 3.25% Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 The UBPR peer group ate all insured commercial banks having assets between $300 million and §1 billion Quarter Ended —#—UBPR Peer Group D&D Bancorp, Inc.
Slide 22: Condensed Balance Sheet
Condensed Balance Sheet Dolars in Thousands March 31, December 31,) 1st Quarter = March 31, ¥-0¥ * Unaudited 2015" 2014 Variance 2014 Variance Assets Cash & cash equivalents $ 18,983 $ 25,851 $ (6,868) $ 32,098 $= (13,117) Securities 126,481 97,896 28,585 102,213 24,268 Loans and Leases 520,854 516,
Slide 23: Balance Sheet Growth
($000) 800,000 700,000 600,000 500,000 400,000 300,000 200,000 100,000 Fidelity D & D Bancorp, Inc. Balance Sheet Growth 564,673 315,802 482.448 407,903 606,742 601,525 514,660 5 424,584 398,186 er 676,485 623,825 __ 586,944 98 469.216 506,327 702,507 ened 601,742 510,488 2010 2011 2012 2013 2014 3/
Slide 24: Capital Adequacy Ratios
Capital Adequacy Ratios March 31, December 31, — March 31, 2015 2014 2014 Total - Risk Based Capital 15.2% 15.3% 15.5% Tier |- Common Equity 13.9% N/A N/A Tier |- Risk Based Capital 13.9% 14.0% 14.2% Leverage 10.1% 10.0% 10.3% D&D Bancorp, Inc.
Slide 25: Slide 25
Slide 26: Wealth: Trust Department Overview
“WEALTH Trust Department Overview
Slide 27: Trust Solutions
Trust Solutions Personal Trust ~ i Corporate Trust * Revocable Trusts * Corporate Trustee * Irrevocable Trusts * Paying Agent * Testamentary Trusts * Escrow Agent * Investment Management * Investment * IRAs MERE JEON OR: * Guardianships * Life Insurance Trusts ° Special Needs Trusts
Slide 28: Retirement
Retirement College Planning Tax Planning Estate Planning & Settlement Investing for Wealth Accumulation and Wealth Preservation
Slide 29: Growth of the Business
Growth of the Business * Of the 5 local community banks with trust departments, Fidelity is 2" largest in assets and in fee generation.
Slide 30: Fee Trends
Fee Trends $700,000 +~ $600,000 - $500,000 -~ $400,000 ~~ $300,000 ~~ $200,000 4 $100,000 -~ | $0 2009 2010 2011 2012 2013 2014 2015 Sidelity
Slide 31: Personal Trust Asset Growth
Personal Trust Asset Growth Year End Market Value $120,000 + $100,000 ~— $80,000 $60,000 ~— $40,000 $20,000 0) anil 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Sidelity
Slide 32: Department Performance
Department Performance IN Another year of continuous upward trends: Revenue increases Growth of Personal Trust assets Positive Income after Direct Expenses Positive Income after Indirect Expenses Positive contribution to ROA Increases due to consistent growth & conscientious expense control
Slide 33: Slide 33
Slide 34: Corporate Trust
Corporate Trust Local School Districts Local Municipalities — Cities — Boroughs — Counties Local Sewer Authorities Pipeline for new business
Slide 35: 2015 Outlook
2015 Outlook ¢ Anticipating a record year... Increases in revenue, asset growth, new households Currently achieved 43% of our annual budget New business pipeline Referrals to other lines of business Enhancement of COI relationships Continued expense control Remain committed to compliant business pra
Slide 36: Managing Wealth At Fidelity Bank
Managing Wealth At Fidelity Bank Trusted Financial Advisors Serving the Needs of our Clients & Achieving the Goals of our Organization Fidelity
Slide 37: Thank you for your continued support of our efforts
Thank you for your continued support of our efforts. Fidelity
Slide 38: Relationship Building
Slide 39: Relationship Building Strategy
Relationship Building Strategy Goal: Trusted Financial Advisor Process: Calling Program Communication and Teamwork Industry Expertise Portfolio alignment with specific roles Utilization of loan participations and programs, such as Small Business Administration (SBA), Federal Home Loan Bank Business
Slide 40: Results in comparison to 2013
Results in comparison to 2013 6% 22% 33% 85% Business Deposit Referralsto other Public Deposit Customer and Growth departments Growth Prospect Meetings
Slide 41: Results in comparison to 2013
Results in comparison to 2013 Net Loan Growth: 6% 9% 11% 27% Commercial Residential Consumer Indirect Dealer
Slide 42: Client Endorsements
“Client Endorsements —_| Endorsements “Our long-standing relationship with Fidelity Bank has been instrumental in our growth and success. For over 20-years we have relied on the expertise and accessibility of all Fidelity team members. Whether it's providing capital for a new project, establishing n
Slide 43: Client Endorsements
even | Endorsements From the moment we were introduced, Fidelity Bank has been an integral part of Veterinary Referral and Emergency Center's business. We were provided with a financial foundation, direction, and flexible tools to not only start a business, but allow it to grow exponentially over th
Slide 44: Risk Management
NAGEMENT
Slide 45: Risks and Reward
Risks and Reward As we are reminded every time we read the news, we live ina world filled with risk. Although specific risks differ between banks, businesses, and families, we all have similar worries q making sure the things we own and the people we 4 care for are safe from loss and harm. At Fideli
Slide 46: Enterprise Risk Management System (ERM)
Enterprise Risk Management System (ERM) ERM systems: 1) Improve communication across the organization; 2) Adapt agency guidance to our risk profile; 3) Tie risk assessments to our capital; 4) Help us manage operational risk; Information & Communication 5) Provide us with a competitive advantage. Mon
Slide 47: Asset Quality Control
Asset Quality Control Since loans comprise about 75% of our total assets and since commercial loans comprise about 55% of our total loans, it follows that we would place great emphasis on making quality loan decisions.
Slide 48: Total Past Due & Non Accrual %
Total Past Due & Non Accrual % Qo 231 2.06 2.09 2013 - 2014 - 2015 Fidelity
Slide 49: Non-performing assets / ALLL
Non-performing assets / ALLL 100,00%
Slide 50: ALLL / Non-accrual Loans
ALLL / Non-accrual Loans ALLL /NON ACCRUALS (xX) es
Slide 51: Commercial Loan Portfolio
Commercial Loan Portfolio "TOTAL" Commercial Ratings by ot "TOTAL" Commercial Ratings by Percentage of Portfolio Dec 2013 a2 Percentage of Portfolio Dec 2014 o3 a4
Slide 52: Net Charge-Offs
Net Charge - Offs Total Net Charge Offs % - Quarterly - to Date 9.0045 The amount of our net 0.0035 charge-offs decreased 70% woes from 2013 to an average . net charge-off of just 0.0015 $244235 Sool -0425% of our total loan 7 074% ‘6.068% * $170, 6 ‘ 0.0005 3 427.056 - portfolio. 0.089%. -0.0005 20
Slide 53: A disciplined approach to risk
A disciplined approach to RISK
Slide 54: Focus
"EOC CU S
Slide 55: Relationship Banking Model: Trusted Advisor
Relationship Banking Model Trusted Advisor
Slide 56: Proactive Relationship Banking
Proactive Relationship Banking ¢ Earning the Trusted Financial Advisor status by identifying clients and utilizing a consultative approach to proactively develop and manage each client relationship to enhance value. Fidelity
Slide 57: Community Involvement
COMMUNITY INVOLVEMENT
Slide 58: Community Involvement
Community Involvement Loose Change Changes Lives at Fidelity Bank Fidelity Bank is always proud and eager to aon help our community. In 2014, nearly $200,000 was given to local organizations are taing to the challenge, through sponsorships, donations and in-kind tnd Joining the Fidelity becca ewer s
Slide 59: Community Involvement
Community Involvement This Spring, 19 Fidelity Bankers from all 11 offices taught almost 1000 students in grades K-4 financial life skills through the “Teach Children to Save” program in celebration of Community Banking Month which takes place nationwide throughout the month of April.
Slide 60: Fidelity Bank Brand Awareness
Fidelity Bank Brand Awareness * Noticeable improvement in the “extremely satisfied” regarding customer perception ¢ Friendliness of tellers 81% (+14% vs 2012) * Professionalism of bank management 70% (+10% vs 2012) ¢ Bank Reputation 70% (+7% in 2012)
Slide 61: H@ICE
H@ICE ‘Che Gimes-Tribune Fidelity
Slide 62: Total Number of Households
Total Number of Households 21,952 19,791 20,000 10,000 | | | 45 11 "12 13 ‘14
Slide 63: Channel Comparison
Channel Comparison Wallet Share 2008 2015 ROC Mobile 129,482 3.27% 0.00% Toller 4982.287 55% Pos 4447270, 28.95% Tel 109,201 eres Pos 723.487 40:31% Online 118,581 289% Online sooeee e288 20.77% 481% 2008-2015 © % Change Teller 13.41% 236% 0.96% 0.04% 0.04% 0.60% 1.72% 3.06% 11.36%
Slide 64: Grand openings coming soon
Grand openings coming soon Grand opening of our New Moosic and Pittston Branch coming up in June!
Slide 65: bankatfidelity.com
bankatfidelity.com Social media posts on community banking, supporting local business and financial literacy Fidelity Bank ‘smal businesses are the engine of job creation 60-80% of new jobs come from smal bz Community banks ike Fdety ate a major source of te funding. In 2014 Fidetty prowded $61 mtn
Slide 66: OLB Rebrand - June
OLB Rebrand- June 6
Slide 67: Anytime Banking! Tablet
Anytime Banking! Tablet @ Filly
Slide 68: Net Income Per Share
Net Income Per Share $3 $2.62 1 of 14 10 7 12 ‘13
Slide 69: Book Value Per Share
Book Value Per Share S 30 $29.75 25 20 15
Slide 70: Ranked in the top community banks in the country by the ABA
bankatfidelity.com RANKED IN THE TOP 200 COMMUNITY BANKS IN THE COUNTRY BY THE ABA Odo AMERICAN BANKERS ASSOCIATION
Slide 71: Total Return Performance
Fidelity D & D Bancorp, Inc. Total Return Performance 300 278 —+ Fidelity 0 & 0 Bancom, Inc 250 ®-NASDAQ Composite 25 #— SNL Bank Pink> $s00M 200 175 160 1% 100 75 1231109 1239/10 193011 1231/12 123113 123014 Period Ending Index TRIS _TRINO aN _ tasth2 _tasis Wasa Fidelity D & D Bancorp, Inc 100.00
Slide 72: Being the Best, Being Better Yesterday
BEING THE BEST BEING BETTER YESTERDAY
Slide 73: Thank You!
Thank You!
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