First Internet Bancorp · NASDAQ:INBK
First Internet Bancorp — Q3 2017 Earnings Presentation
29 slides from First Internet Bancorp's earnings presentation, Nov 1, 2017
Slide 1: First Internet Bancorp Investor Presentation Third Quarter 2017
First Internet Bancorp Investor Presentation Third Quarter 2017 Exhibit 99.1
Slide 2: Forward Looking Statement
Forward Looking 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 “beli
Slide 3: Non-GAAP Financial Measures
Non-GAAP Financial Measures 3 This presentation contains financial information determined by methods other than in accordance with U.S. generally accepted accounting principles (“GAAP”). Non-GAAP financial measures, specifically tangible common equity, tangible assets, tangible book value per common
Slide 4: Performance Summary
Performance Summary 4 Strong balance sheet growth has driven increased earnings and overall growth in tangible book value per share 1 1Q17, 2Q17 and 3Q17 amount reflects full impact of offering of 945,000 shares of common stock in December 2016 2 See Reconciliation of Non-GAAP Financial Measures Dil
Slide 5: Third Quarter 2017 Highlights
Third Quarter 2017 Highlights Record quarterly diluted EPS of $0.71, up 16% over 2Q17 and 29% over 3Q16 Record quarterly net income of $4.9 million, up 22% over 2Q17 and 58% over 3Q16 Quarterly net interest income of $14.2 million, up 9% over 2Q17 and 37% over 3Q16 Total quarterly loan growt
Slide 6: Corporate Overview
Corporate Overview Corporate Summary First Internet Bank launched in 1999 First state-chartered FDIC-insured Internet bank Headquartered in Fishers, IN with an office in Tempe, AZ Industry pioneer in branchless delivery of consumer and commercial banking services Nationwide deposit and len
Slide 7: Differentiated Business Model
Differentiated Business Model Nationwide consumer banking provider Proven online / mobile retail deposit platform using scalable technology backed by exceptional customer service Low cost delivery channel creates customer value through competitive rates and low fees Commercial banking franch
Slide 8: Components of a Diversified Growth Engine
Components of a Diversified Growth Engine 8 Contribution to Total 3Q16 Loan Growth of $87 Million Contribution to Total 3Q17 Loan Growth of $170 Million 2017: Balanced Growth – Reduced CRE Concentration – High Credit Quality 80% 24% -2% -2% Single Tenant Lease Consumer C&I/Other CRE Mortgage/Home Eq
Slide 9: Strategic Objectives
Strategic Objectives Drive revenue growth and positive operating leverage Achieve consistent strong profitability Deploy capital in an accretive manner focused on building shareholder value Capitalize on consumer trends by capturing greater deposit market share among digital banking adopters
Slide 10: Corporate Recognition
10 Corporate Recognition First Internet Bank has been recognized for its innovation and is consistently ranked among the best banks to work for, enhancing its ability to attract and retain top-level talent Top Rated Online Business Bank in 2017 – Advisory HQ TechPoint 2016 Mira Award “Tech-enabl
Slide 11: Consistent Balance Sheet Growth
Consistent Balance Sheet Growth 11 Execution of the business strategy has driven consistent and sustainable balance sheet growth CAGR: 34.9% CAGR: 41.6% CAGR: 32.2% CAGR: 31.1% Total Assets Total Loans Total Deposits Shareholders' Equity $636 $802 $971 $1,270 $1,854 $2,633 2012 2013 2014 2015 2016 3
Slide 12: Five Year Balance Sheet Growth
Five Year Balance Sheet Growth Five year balance sheet growth rates far exceed the median rates for similar institutions INBK growth over this period has been primarily organic as opposed to through acquisitions 12 Source: Company data and SNL Financial; financial data as of September 29, 2017;
Slide 13: Earnings and Profitability
Earnings and Profitability 13 The Company remains focused on driving earnings growth and improving profitability 1 See Reconciliation of Non-GAAP Financial Measures Net Income Net Interest Margin - FTE1 Return on Average Assets Return on Average Tangible Common Equity1 $2,278 $2,432 $2,834 $3,098 $3
Slide 14: Increasing Economies of Scale
Increasing Economies of Scale 14 Scalable, technology-driven model delivers increasing efficiency and is a key component driving improved operating leverage Net Interest Income Noninterest Expense / Average Assets Efficiency Ratio Total Assets Per FTE 2.11% 2.08% 1.98% 1.93% 1.77% 1.85% 1.63% 1.50%
Slide 15: Loan Portfolio Overview
Loan Portfolio Overview 15 1 1 Includes commercial and industrial and owner-occupied commercial real estate balances Dollars in thousands 2014 2015 3Q16 4Q16 1Q17 2Q17 3Q17 Commercial loans Commercial and industrial 77,232$ 102,000$ 107,250$ 102,437$ 97,487$ 107,569$ 122,587$ Owner-occupied commerci
Slide 16: Commercial Real Estate
Commercial Real Estate Single tenant lease financing overview: Long term lease financing of single tenant properties occupied by financially strong lessees Originations / commitments over the past twelve months exceeded $276 million Nationwide platform provides ability to capitalize on nationa
Slide 17: Commercial and Industrial
Commercial and Industrial Commercial and industrial overview: Originations / commitments over the past twelve months exceeded $112 million Primarily serves the borrowing and treasury management needs of small and middle- market businesses Seasoned banking team leverages market knowledge and ex
Slide 18: Public Finance
Public Finance Public finance overview: Launched in January 2017 Provides a range of credit solutions for government and not-for-profit entities Borrowers’ needs include short-term financing, debt refinancing, infrastructure improvements, economic development and equipment financing Initial
Slide 19: Healthcare Finance
Healthcare Finance Healthcare finance overview: Launched in second quarter 2017 Strategic partnership with San Francisco – based Lendeavor Currently focused on dental and veterinary practices Borrowers’ needs include practice finance or acquisition, acquiring or refinancing owner-occupied co
Slide 20: Residential Mortgage
Residential Mortgage 20 Last 12 Months of Mortgage Originations – Regional Distribution Award-winning national online origination platform Highly efficient application and underwriting process Sales and marketing efforts re-focused on purchase mortgage business Full range of residential mort
Slide 21: Nationwide Branchless Deposit Franchise
Nationwide Branchless Deposit Franchise 21 Total Deposits – $2.0 Billion – Regional Distribution As of September 30, 2017 Nationwide consumer, small business and commercial deposit base Scalable technology and customer convenience supported by exceptional service Deposit relationships in all 5
Slide 22: Deposit Composition
Deposit Composition Total deposits increased $503.4 million, or 33.7%, since 3Q16 Treasury management, small business deposits and municipal deposits provide significant opportunities for increasing lower-cost deposits 22 Total Deposits - $1,997.0 Million As of September 30, 2017 Total Non-Time
Slide 23: Asset Quality
Asset Quality 23 Asset quality has improved significantly while balance sheet growth has continued on a strong upward trend NPAs / Total Assets NPLs / Total Loans Allowance for Loan Losses / NPLs Net Charge-Offs (Recoveries) / Average Loans 1.62% 0.90% 0.50% 0.37% 0.31% 0.30% 2012 2013 2014 2015 201
Slide 24: Capital
Capital 24 Following the initial public offering in late 2013, the Company deployed capital to fund commercial loan growth, driving revenue growth and improved profitability 2016/2017 capital offerings: 2Q16: raised $22.8 million of common equity 3Q16: issued $25.0 million in publicly traded
Slide 25: Execution: Targets at $3.8-$4.0B Assets
Efficiency Ratio < 50% Noninterest Expense / Average Assets < 1.40% ROATCE 1 12.00% ROAA 0.90% + Expected Quarterly Results at $3.8-$4.0B Enhancing franchise value 1 Operating seamlessly 2 Remaining agile 3 Remain opportunistic Constant evolution and refinement of our business model Add asset
Slide 26: Investment Summary
Investment Summary Strong earnings growth improving profitability Demonstrated track record of deploying capital to fuel loan growth while maintaining strong asset quality Investments in commercial lending platforms are producing results Geographic and credit product diversity provide abilit
Slide 27: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures 27 Dollars in thousands 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 Total equity - GAAP $104,330 $107,830 $135,679 $137,154 $153,942 $157,491 $163,830 $220,867 Adjustments: Goodwill (4,687) (4,687) (4,687) (4,687) (4,687) (4,687) (4,687) (4,687) Tangible com
Slide 28: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures 28 1 Assuming a 35% tax rate Dollars in thousands 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 Net Income 2,278$ 2,432$ 2,834$ 3,098$ 3,710$ 2,832$ 4,001$ 4,895$ Adjustments: Income tax provision 1,195 1,298 1,421 1,521 1,671 1,023 1,464 1,694 Provision for l
Slide 29: First Internet Bancorp Third Quarter 2017
First Internet Bancorp Investor Presentation Third Quarter 2017
First Internet Bancorp — Q3 2017 Earnings Presentation on 6ix