Camden National Corporation · NASDAQ:CAC
Camden National — Investor Presentation (November 2014)
29 slides from Camden National's investor presentation, Nov 5, 2014
Slide 1: November 5, 2014
November 5, 2014 NASDAQ: CAC 1
Slide 2: Safe Harbor Statement
Safe Harbor Statement The information presented may contain forward‐looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are based upon current beliefs and expectations and are subject to significant risks and uncertainties some of which are
Slide 3: Camden National Corporation
Camden National Corporation Camden National Corporation is a Maine‐based community bank focused on delivering long‐ term shareholder value through banking, brokerage and wealth management services in Maine, New Hampshire and select markets of Northern New England. 3
Slide 4: Camden National Corporation Overview
Camden National Corporation Overview Corporate Snapshot • Headquartered in Camden, ME; Founded 1875 • Subsidiaries: • Camden National Bank ‐ $2.7 billion Assets • Acadia Trust ‐ $708 million AUM • 480 Employees • 44 Branch Locations Financial Overview Shareholder Profile • Shares Outstanding 7.4 mil
Slide 5: Camden National Corporation Profile
Camden National Corporation Profile • Founded 1875 in Camden, Maine • Largest publicly traded community bank in Maine and Northern New England • Second largest Maine based bank • Fourth in the state for deposit market share Source: SNL Financial 5
Slide 6: Financial Highlights As of September 30, 2014 and 2013
(in 000’s) 9/30/14 9/30/13 Loans (a) $1,726 $1,590 Investment Securities 804 803 Total Assets 2,742 2,597 Deposits (b) 1,929 1,973 Borrowings 541 347 Shareholders’ Equity 240 232 (a) Loan growth since 9/30/13 of $182.6 million, or 12%, after adjusting for $46.0 million of divested loans. (b) Deposit
Slide 7: Financial Highlights For nine months ended September 30, 2014 and 2013
9/30/14 9/30/13 Net Income (in millions) (a) $18.5 $18.4 Diluted Earnings per Share $2.46 $2.39 Return on Tangible Equity 13.71% 14.01% Return on Assets 0.93% 0.95% Efficiency Ratio 61.01% 61.81% Net Interest Margin 3.10% 3.21% (a) 2013 results include net income contribution of $424,000 from branch
Slide 8: Loan Mix
Commercial 14% Commercial Real Estate 36% Residential Mortgages 33% Home Equity/ Consumer 17% Loan Mix 9/30/14 Total Loans: $1.73 billion Yield: 4.23% Loan Profile • $36 million legal lending limit • Largest relationship $28 million • Top industry exposures: • Nonresidential building operators of $1
Slide 9: Investment Portfolio
Portfolio Stats Market Value $783 Million Average Yield 2.25% Duration 3.87 Years Premium $7.4 Million Premium as % of Portfolio 0.95% Investment Portfolio As of 9/30/14 Excludes FRB/FHLB stock of $20 million MBS 48% Agency CMO 46% Municipals 5% Non‐Agency 1% Book Value ‐ $788 Million 9
Slide 10: Funding
Checking 31% Savings/Money Market 27% CD's 20% Borrowings 22% Funding Mix Funding: $2.47 billion Total Funding Cost: 0.50% Deposit Cost: 0.28% Funding As of 9/30/14 $‐ $200 $400 $600 $800 $1,000 $1,200 $1,400 $1,600 2008 2009 2010 2011 2012 2013 2014 M i l l i o n s Core Deposits CDs & Borrowings Ch
Slide 11: Net Interest Margin and Interest Rate Risk
Net Interest Margin 3.55% 3.58% 3.60% 3.54% 3.47% 3.64% 3.51% 3.53% 3.45% 3.37% 3.29% 3.19% 3.24% 3.22% 3.14% 3.10% 3.05% 3.10% 3.10% 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% 3.50% 4.00% Quarterly NIM Estimated Changes In Net Interest Income Year 1 +400bp ‐6.0% +200 bp ‐6.1% ‐100 bp ‐0.4% Year 2 +4
Slide 12: Why Camden National?
Why Camden National? • Earnings power and capital generation to fund growth • Successful record of acquired and organic growth • Disciplined risk management • Strategic repositioning for future shareholder value • Long‐term value and return to shareholders 12
Slide 13: Solid Earnings Performance to Fund Growth
Solid Earnings Performance to Fund Growth • Investment in branches, lenders, and technology impact financial performance in the short‐term • Driven to create consistent returns for our shareholders • Efficient operations focused on revenue generation Proxy Peer – Average of 17 publicly traded commer
Slide 14: Solid Track Record of Organic and Acquired Growth
Solid Track Record of Organic and Acquired Growth Asset Growth History Source: SNL Financial $0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Total Assets (in millions) United Corp. $54 million KSB Ban
Slide 15: Disciplined Risk Management Culture
Disciplined Risk Management Culture • Strong capital growth to support future growth • Credit quality consistent with Northeast peer group • Stable asset quality through economic downturn NPAs to Total Assets Net Charge Offs to Average Loans Total Risk Based CapitalHighlights 12.32% 13.49% 15.05% 15
Slide 16: Strategic Repositioning: Focus on Growth Markets
Source: SNL Financial Strategic Repositioning Focus on Growth Markets Franklin County Branch Divestiture ($80MM Deposits) I‐95 Corridor BofA Branch Acquisition ($287MM Deposits) Mid‐Coast Region ($917MM Deposits) 16
Slide 17: Strategic Repositioning: Preparing for the Future
• Branch Acquisitions • Acquisition of 14 branches from Bank of America resulted in $287 million in core deposits • Increased our market share in Maine and improved presence in growth markets • Earn back of Tangible Book Value within four years • Branch Divestitures/Consolidation • Sold five branche
Slide 18: Strategic Repositioning: Preparing for the Future
• Talent Acquisition and Development • Hired 10 commercial bankers and mortgage originators • Improved credit administration • Internal management programs • New Markets – Manchester, New Hampshire • Experienced commercial real estate lender with 25 years • Loan production office based delivery plat
Slide 19: Long Term Value: Consistent Shareholder Returns
Long Term Value Consistent Shareholder Returns • Earnings per share compound annual growth of 6.53% over a 15‐year period • Tangible book value compound annual growth of 7.62% over a 15‐year period $1.27 $1.69 $1.89 $2.11 $2.38 $2.53 $2.80 $2.93 $3.09 $2.00 $2.98 $3.23 $3.40 $3.05 $2.97 $3.28 $0.00
Slide 20: Long Term Value: Dividend Commitment
• Consistent quarterly dividends and periodic special dividends • Dividend yield compared to National Peer Long Term Value Dividend Commitment Dividend Yield 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 2008Y 2009Y 2010Y 2011Y 2012Y 2013Y MRQ Current Nationwide Peer Group ( Banks and Thrifts $1-5B,
Slide 21: Long Term Value: Relative Total Return Performance
• Compared to NASDAQ Bank and S&P 500 Bank • Compared to Proxy Peer Group Long Term Value Relative Total Return Performance (10‐Year) 55.4% (15.8%) (37.9%) (100.0%) (80.0%) (60.0%) (40.0%) (20.0%) 0.0% 20.0% 40.0% 60.0% 80.0% Nov-04 Nov-05 Nov-06 Nov-07 Nov-08 Nov-09 Nov-10 Nov-11 Nov-12 Nov-13 CAC
Slide 22: Camden National Corporation
@) Camden National Corporation
Slide 23: Seasoned Management Team
Seasoned Management Team Age Years of Banking Experience Year joined Camden Greg Dufour, President and CEO 54 25+ 2001 Debbie Jordan, CPA, EVP and CFO 49 20+ 2008 Joanne Campbell, EVP Risk Management 52 30+ 1996 Peter Greene, EVP Operations and Technology 55 30+ 2008 Tim Nightingale, EVP Senior Loan
Slide 24: Market Demographics
Market Demographics Current Southern Southern Footprint ME NH Market Segments & Growth Total Households 291,602 202,605 453,657 Projected Growth, 2014 to 2019 0.2% 1.9% 1.3% Mass Affluent Households 78,216 102,179 259,169 % of Total Households 26.8% 50.4% 57.1% Number of Businesses 41,767 32,627 65,
Slide 25: Deposit Market Share
Deposit Market Share 62% 6% 16% 10% 8% 25% 7% 2% 6% 41% 7% Source: SNL Financial FDIC Deposit Market Share data as of 6/30/14. (excludes credit unions) Maine 2014 Rank Institution 2014 Number of Branches 2014 Total Deposits in Market ($000) 2014 Total Market Share (%) 1 Toronto‐Dominion Bank 50 3,16
Slide 26: Proxy Peer Group
Proxy Peer Group Arrow Financial Corporation ‐ NY Bar Harbor Bankshares ‐ME Berkshire Hills Bancorp, Inc. ‐MA Brookline Bancorp, Inc. ‐MA Century Bancorp, Inc. ‐MA Chemung Financial Corporation ‐ NY Enterprise Bancorp, Inc. ‐MA Financial Institutions, Inc. ‐ NY First Bancorp, Inc. – ME Independent B
Slide 27: Reconciliation of non-GAAP to GAAP Financial Measures
Reconciliation of non‐GAAP to GAAP Financial Measures 27 Non-interest expense, as presented $ 46,096 $ 47,347 $ 66,333 $ 59,031 Less: branch acquisition and divestiture costs Less: goodwill impairment Less: prepayment penalties on borrowings Adjusted non-interest expense $ 46,096 $ 47,068 $ 63,129 $
Slide 28: Reconciliation of non-GAAP to GAAP Financial Measures
Reconciliation of non‐GAAP to GAAP Financial Measures 28 Net income, as presented $ 18,482 $ 18,359 $ 22,783 $ 23,428 Add: tax-effected goodwill impairment — — 2,830 — Add: tax-effected amortization of intangible assets Net income, adjusted $ 19,042 $ 18,920 $ 26,360 $ 23,855 Average equity $ 234,57
Slide 29: Reconciliation of non-GAAP to GAAP Financial Measures
Reconciliation of non‐GAAP to GAAP Financial Measures The following table provides a reconciliation between tangible equity to tangible assets and GAAP equity to assets: Shareholders' equity, as presented $ 239,912 $ 232,282 $ 231,096 $ 233,815 Less: goodwill and other intangibles Tangible equity $
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