Unity Bancorp, Inc. · NASDAQ:UNTY
Unity Bancorp — Investor Presentation (November 2017)
25 slides from Unity Bancorp's investor presentation, Nov 2, 2017
Slide 1: Unity Bancorp Inc 9/30/17
W Unity BANCORP INC 9/30/17 NASDAQ: UNTY
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation may contain forward-looking statements with respect to Unity Bancorp’s financial condition, results of operations and business. Do not unduly rely on forward-looking statements. Forward- looking statements can be identified by the use of words such as “ma
Slide 3: Company Snapshot
Company Snapshot « Founded September 16, 1991 « Headquartered in Clinton, New Jersey « Approximately $1.3 billion in assets and $1.0 billion in deposits « Unity Bank provides financial services to retail, corporate and small business customers through its 17 retail service offices located in Bergen,
Slide 4: Franchise
Franchise Forks Township, PA Highland Park, NJ Phillipsburg, NJ Edison, NJ Washington, NJ South Plainfield, NJ Clinton, NJ Scotch Plains, NJ Flemington, NJ Union, NJ Whitehouse, NJ Linden, NJ Somerset, NJ Somerville, NJ North Plainfield, NJ Emerson, NJ Middlesex, NJ ©OVOHRON « Coming Soon: « Ramsey,
Slide 5: Strategic Goals
Strategic Goals « To grow our business relationships by being a responsive bank, providing excellent service with flexible terms and conditions— 10% loan growth « Mortgage Division — 15% growth rate « SBA Division — Increase 7A Volume no less than $40 million « Growth in core deposits of at least 5%
Slide 6: Senior Management
Senior Mar James A. Hughes, CPA Alan J. Bedner, Jr. CPA emen m + President and Chief Executive Officer + Chief Financial Officer + Joined the company in 2000 + Joined the company in 2001 + 30 years banking experience * 21 years banking experience + Previously employed at Summit Bancorp + Previously
Slide 7: Engaged Board of Directors
Engaged Board of Directors ¢ David Dallas, Chairman of the Board, and Robert Dallas, Board Member, both founding members of the Bank @ Average tenure of Board Members is 15 years @ Diverse experience including financial industry, medical professionals, university professional and business ownership
Slide 8: Recent Financial Performance
Recent Financial Performance an
Slide 9: Summary Balance Sheet
Summary Balance Sheet (dollars in millions) 12/31/2015 12/31/2016 9/30/2017 Assets $ 1,084.9 |$ 1,189.9 |$ 1329.8 Total Loans 889.0 973.4 1,092.9 Deposits 894.5 945.7 1,043.6 Total Equity 78.5 106.3 115.8
Slide 10: Loan Mix
Loan Mix (dollars in millions) $1,200.00 $ 1,092.9 $973.4 $109.4 $1,000.00 $ 889.0 $915 $771 $800.00 5 59.1 $600.00 $400.00 2013 2014 2015 2016 3Q2017 Commercial Loans Mortgage Loans USBALoans \iConsumer Loans
Slide 11: Mortgage Loan Originations
Mortgage Loan Originations (dollars in millions) Mortgage Growth $200.00 $192. $180.9 $153.4 $180.00 $160.00 $140.00 ‘$129. $120.00 $100.00 $80.00 $60.00 $40.00 $20.00 2013 2014 2015 2016 3Q2017 wPurchases @Refinances 10
Slide 12: Asset Quality Continues to Improve
0.90% 0.80% 0.70% 0.60% 0.50% 0.40% 0.30% 0.20% 0.10% 0.00% Asset Quality Continues to Improve 0.76% 0.78% 3Q2016 4Q2016 1Q2017 2Q2017 3Q2017 Nonperforming Loans @TDRs u
Slide 13: Deposit Trend
5 Year Deposit Trend (dollars in millions) $1,200.00 $ 1,043.6 $1,000.00 $945.7 $994.5 $794.3 $800.00 S538. $600.00 $400.00 $200.00 s- 2013 2014 2015 2016 3Q2017 ulnterest-bearing DDA & SAV deposits Total time deposits w Noninterest-bearing demand deposits
Slide 14: Summary Income Statement and Profitability
(dollars in millions) Summary Income Statement and Profitability Net Interest Income $ $ Provision for Loan Losses INoninterest Income Noninterest Expense Provision for Income Taxes Net Income $ $ Diluted Earnings Per Share s 1.06 |$ 0.97 Return on Average Assets 1.20 % 112 % Return on Average Equit
Slide 15: Net Interest Income & Net Interest Margin
Net Interest Income & Net Interest Margin (dollars in millions) $45.00 = 4.00% $40.00 63% 3.58% 3.58% 3.50% $35.00 $30.00 3.00% $25.00 2.50% $20.00 $15.00 2.00% $10.00 1.50% $5.00 s 1.00% 2013 2014 2015 2016 3Q2016 YTD + 3Q2017 YTD ‘ceNet Interest Income =f Net Interest Margin
Slide 16: Strong Levels of Noninterest Income
Strong Levels of Noninterest Income (dollars in millions) oninterest Income (excludes ins [losses] on secu $10.00 20.00% Ba 18.30% 18:46% * 18.01%" 18.00% $8.00 $66 15.57% 160% fe) 14.00% $5.00 wee 12.00% $3.00 10.00% $2.00 8.00% $1.00 s- 6.00% 2013 2014 2016 3Q2016 YTD — 3Q2017 YID iNoninterest Inc
Slide 17: Noninterest Income
Noninterest Income (dollars in thousands) 3Q2016 YTD 3Q2017 YID ‘Branch fee income $ 9401S 1,029 Service and loan fee income 796) 1,472] Gain on sale of SBA loans held for sale, net 1,584] 1,348 Gain on sale of mortgage loans, net 1,917 1,188 BOLI income 283} 289) (Net security gains 186 69 ‘Net gai
Slide 18: Noninterest Expense Controls
Noninterest Expense Controls (dollars in millions) Noninterest $35.00 2.88% $30.00 $25.00 F088 $20.00 $15.00 $10.00 0.00% 2013 2015 2016 3Q2016 YTD 3Q2017 YTD scexNoninterest Expense —fi+Noninterest Expense/Average Assets a
Slide 19: Noninterest Expense
Noninterest Expense (dollars in thousands) 16 YTD 7YID Compensation and benefits $ 11,130|$ 12,662 Occupancy 1,742! 1,791 Processing and communications 1,980 1,892 Furniture and equipment 1,247 1,537 Professional services 710) T2A Loan collection & OREO expenses 268) 493 Other loan expenses 120 149]
Slide 20: Profitability Progression
Profitability Progression Diluted Earni $1.60 $1.38 $1.40 Aa $1.20 $1.06 $1.00 2016 3QQ016 YTD 3Q2017 YTD Effect of nonrecurring gain on repurchase of subordinated debenture 9
Slide 21: Tangible Book Value Per Share (Non-GAAP)
$12.00 $11.00 $10.00 $9.00 $8.00 $7.00 Tangible Book Value Per Share (Non-GAAP) — 1 2013 2015 2016 3Q2017 Note: 2013 reflects redemption of TARP preferred stock and the associated warrant * Capital Raise of $15 millon at a weighted average price per share of $14.04; net increase of $14.4 million aft
Slide 22: Market Price
$21.00 $19.00 $17.00 $15.00 $13.00 $11.00 $9.00 $7.00 $5.00 $3.00 Market Price 2013 2014 2015 2016 9/30/2017 a
Slide 23: Capital Ratios
Capital Ratios Total 1 Risk-Based Capital [unity Bancorp, inc. 16.00% GM Fpic-insured Commercial Banks 12.00% Total Risk-Based Capital 18.00% 8.00% 15.00% 4.00% 12.00% 2013 2014 2015 2016 © 2Q2017 Leverage 9.00% 12.00% 6.00% 10.00% 3.00% 2013 2014 2015 2016 = 2Q2017 8.00% 6.00% 4.00% 2013 2014 2015
Slide 24: Compelling Investment Highlights
Compelling Investment Highlights Knowledgeable and experienced management team of Attractive branch franchise 23
Slide 25: Data sources
The previous slides contained data from the following sources: FDIC-Insured Commercial Banks: Obtained from FDIC. gov Quarterly Banking Profile SNL
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