Meridian Corporation · NASDAQ:MRBK
Meridian — Q1 2020 Earnings Presentation
22 slides from Meridian's earnings presentation, May 5, 2020
Slide 1: 1st QTR Investor Presentation
1st QTR Investor Presentation May 6, 2020 NASDAQ: MRBK ®
Slide 2: Forward-Looking Statements
2 Meridian Corporation Forward-Looking Statements Meridian Corporation (the “Corporation”) may from time to time make written or oral “forward-looking statements” within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking stateme
Slide 3: Company Highlights
3 Meridian Corporation Company Highlights Demonstrated organic growth engine in diversified loan segments, capitalizing on sales culture and big bank missteps in the Delaware Valley tri-state market Financial services business model with significant non-interest income streams in Meridian Mortgage,
Slide 4: Company Snapshot
4 Meridian Corporation Company Snapshot 1) As of and for the quarter ended March 31, 2020, per April 27, 2020 press release 2) Includes loans held for sale and held for investment 3) Excludes loans at fair value Overview Financial Highlights 1QTR 2020¹ Balance Sheet ($ in Millions) Asset Quality (%)
Slide 5: Current Meridian Franchise Footprint
5 Meridian Corporation Current Meridian Franchise Footprint Geographic Footprint Meridian Corporation Holding Company Meridian Bank 100% Owned Subsidiary Organizational Structure Meridian Wealth Partners 100% Owned Subsidiary Apex Realty 100% Owned Subsidiary Meridian Land Settlement Services 100% O
Slide 6: Deep and Experienced Leadership
6 Meridian Corporation Deep and Experienced Leadership Meridian Bank Executive Management Chris Annas Chairman of the Board President & CEO Founder, Chairman, President and Chief Executive Officer of the Bank since its opening in 2004 Held executive positions with various regional banks in the Delaw
Slide 7: Overview of Business Lines
7 Meridian Corporation Overview of Business Lines Commercial & Industrial Lending – Lines of credit, term loans – Owner-occupied commercial mortgages – Leasing Commercial Real Estate Lending – Owner occupied commercial mortgages – Construction loans – Land development loans Consumer Lending – Home e
Slide 8: Consistent Balance Sheet Growth
8 Meridian Corporation Consistent Balance Sheet Growth 1) Includes loans held for sale and held for investment Total Assets ($M) Loans and Leases1 ($M) Total Deposits ($M) Consolidated Equity ($M) $582.2 $663.3 $733.7 $856.0 $997.5 $1,150.0 $1,303.4 2014 2015 2016 2017 2018 2019 1Q 2020 $525.9 $584.
Slide 9: Summary Income Statement
9 Meridian Corporation Summary Income Statement1 1) Decrease in 2017 profitability due to a decrease in net operating profit from mortgage division ($1.8M); 2017 tax reform resulted in a one-time charge to tax expense of $737K Net Interest Income ($M) Non-interest Income ($M) Non-interest Expense ($
Slide 10: Capital Summary
10 Meridian Corporation Capital Summary Tangible Common Equity / Tangible Common Assets (%) 7.98% 9.54% 11.27% 10.53% 13.52% 11.77% 7.98% 9.54% 11.27% 10.53% 10.12% 8.73% 2015 2016 2017 2018 2019 1Q 2020 8.39% 9.67% 12.37% 11.16% 14.08% 13.22% 8.39% 9.67% 12.37% 11.16% 10.55% 9.80% 2015 2016 2017 20
Slide 11: Asset Quality
11 Meridian Corporation Asset Quality 1) Nonperforming assets defined as loans 90+ days past due and still accruing, nonaccrual loans and leases and OREO, excluding performing TDRs 2) Excludes loans at fair value NPAs¹ / Assets (%) Reserves / Loans2 (%) Nonaccrual Loans / Loans (%) Net Chargeoffs /
Slide 12: Balanced Loan Portfolio
12 Meridian Corporation $1.1Billion total gross loans and leases as of March 31, 20201 – 13.7% CAGR Dec 2014 through Dec 2019 CRE concentration of 196.5% as of March 31, 2020 Average yield on loans of 5.21% for 1Q 2020 Balanced Loan Portfolio March 31, 2020 1) Total loans held for investment and hel
Slide 13: Commercial Loans by Industry
Commercial Loans by Industry March 31, 2020 Meridian Corporation Note: Balances do not include consumer loans; HELoC, and 1st mortgages Source: Company documents
Slide 14: COVID-19 Response
14 Meridian Corporation COVID-19 Response Source: Company documents Commercial: – Payment holiday up to 3 billing cycles – Interest only Construction: – PA moratorium on construction – Lowered rates – Two or Three billing cycles Residential: Three month payment holiday Loan Assistance Programs Avail
Slide 15: Shared National Credits
15 Meridian Corporation Shared National Credits Source: Company documents
Slide 16: Total Deposits and Deposit Composition
16 Meridian Corporation $993.8 million total deposits as of March 31, 2020 – 13.0% CAGR for total deposits Dec 2014 through Dec 2019 – 28.1% CAGR for noninterest-bearing deposits Dec 2014 through Dec 2019 Diversified deposit mix – 33% transaction accounts – 14.2% noninterest-bearing deposits / depos
Slide 17: Investment Portfolio Composition
17 Meridian Corporation Investment Portfolio Composition $99.3 million total investments as of March 31, 2020 – 92.2% available-for-sale – 7.8% held-to-maturity Average TEY of 2.57% year-to-date Unrealized gain $712 thousand at March 31, 2020 Conservative investment portfolio – No corporate debt – 1
Slide 18: Interest Rate Risk
18 Meridian Corporation Interest Rate Risk Source: Company documents Dollars in Millions (200)BPS (100)BPS Base 100 BPS 200 BPS 300 BPS 400 BPS Net Interest Income 3/31/2020 $ 40.30 $ 41.40 $ 41.70 $ 41.60 $ 41.80 $ 42.00 $ 42.30 12/31/2019 $ 39.60 $ 40.00 $ 40.30 $ 40.60 $ 40.90 $ 41.10 $ 41.30 NII
Slide 19: Appendix
19 Meridian Corporation Appendix
Slide 20: Historical Financial Highlights
20 Meridian Corporation Historical Financial Highlights
Slide 21: Reconciliation of Non-GAAP Financial Measures
21 Meridian Corporation Reconciliation of Non-GAAP Financial Measures Tangible common equity to tangible assets Management uses the measure tangible common equity to tangible assets to assess our capital strength. We believe that this non-GAAP financial measure is useful to investors because, by rem
Slide 22: Reconciliation of Non-GAAP Financial Measures
22 Meridian Corporation Reconciliation of Non-GAAP Financial Measures Tangible common equity to tangible assets