Seacoast Banking Corporation Of Florida · NASDAQ:SBCF
Seacoast Banking Corporation Of Florida — Seacoast Banking Corp of Florida — Investor Presentation (August 2018)
57 slides from Seacoast Banking Corporation Of Florida's investor presentation, Aug 21, 2018
Slide 1: Investor Presentation Q2 2018
Contact: (email) Chuck.Shaffer@SeacoastBank.com (phone) 772.221.7003 (web) www.SeacoastBanking.com Investor Presentation Q2 - 2018
Slide 2: Cautionary Notice Regarding Forward-Looking Statements
Cautionary Notice Regarding Forward - Looking Statements 2 This press release contains "forward - looking statements" within the meaning, and protections, of Section 27 A of the Securities Act of 1933 and Section 21 E of the Securities Exchange Act of 1934 , including, without limitation, statements
Slide 3: Agenda
Agenda 3 ABOUT SEACOAST BANK 1 COMPANY PERFORMANCE 2 SEACOAST’S DIFFERENTIATED STRATEGY 3 OUTLOOK 4
Slide 4: Valuable Florida Bank Franchise With Balanced Growth Strategy
• $5.9 billion in assets as of June 30, 2018 operating in the nation’s third most - populous state • Strong and growing presence in four of Florida’s most attractive MSAs ‒ #1 Florida based bank in the Orlando MSA ‒ Growing share in West Palm Beach ‒ #2 share in Port St Lucie MSA ‒ Growing presence
Slide 5: Seacoast Has Outperformed the Major Indices
Florida Bank Peers (1) 5 Seacoast Has Outperformed the Major Indices … S&P 500 SBC F KBW Regional Banking Index Source: Bloomberg Note: Market data as of 7/26/2018 (1) Florida Bank Peers includes Florida headquartered banks with greater than $200 m illion and less than $30 billion in market capitali
Slide 6: And is Doing so Prudently
FCB Finl Hldgs Inc CenterState Bank State Bk Finl Corp BankUnited Inc Capital City Bank Home BcShrs Inc South Bcshs Inc Sterling Bncp Ameris Bancorp Eagle Bancorp Valley Natl Bncp Bk OZK 2% 4% 6% 8% 10% 12% 14% 16% 18% 20% 22% 24% 0.90x 1.40x 1.90x 2.40x 2.90x 3.40x 3.90x 4.40x CRE / Total Capital R
Slide 7: Agenda: Company Performance
Agenda 7 ABOUT SEACOAST BANK 1 COMPANY PERFORMANCE 2 SEACOAST’S DIFFERENTIATED STRATEGY 3 OUTLOOK 4
Slide 8: Q2 2018 Highlights
8 2 Q 2018 Highlights With a growing presence in Florida’s most attractive markets, Seacoast is one of Florida’s top - performing banking franchises. • Earnings per share totaled $0.35 on a GAAP basis, and $0.38 per share on an adjusted basis 1 . • Net income increased 121% YoY to $17.0 million, whi
Slide 9: Notable Items Impacting Results by $0.05 per share
Notable Items Impacting Results by $0.05 per share in the Second Quarter 9 • $0.5 million reduction in accretion from discounts on acquired loans quarter over quarter . • Experienced higher prepayments quarter over quarter on the nonacquired originated loan portfolio which reduced loan growth by 3 %
Slide 10: First Green Bank Acquisition: Continuation of Land and Expand M&A Strategy
First Green Bank Acquisition: Continuation of “Land and Expand” M&A Strategy in Orlando FL 10 High - Quality Expansion In Attractive Market • Expands footprint in Orlando, Florida’s 3rd largest MSA • Significantly strengthens Seacoast’s position as the #1 community bank by deposit market share in th
Slide 11: Net Interest Income and Margin
11 ($ in thousands) • Net interest income 1 totaled $50.3 million, up $0.4 million or 1 % from the prior quarter and $6.0 million or 14% from the prior year quarter. • Net interest margin was 3.77% in the current quarter compared to 3.80% in the prior quarter and 3.84% in the second quarter of 2017.
Slide 12: Adjusted Noninterest Income
12 $2,435 $2,626 $2,566 $2,672 $2,674 $2,671 $2,582 $2,836 $2,942 $3,076 $1,268 $1,318 $1,214 $1,380 $1,500 $1,272 $2,138 $1,487 $1,402 $1,336 $2,064 $1,981 $2,174 $2,946 $3,117 $757 $836 $1,100 $1,056 $1,066 $0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $7,000 $8,000 $9,000 $10,000 $11,000 $12,000 $
Slide 13: Adjusted Noninterest Expense
13 $18,225 $18,097 $15,774 $18,274 $19,417 $3,108 $3,211 $3,216 $3,643 $3,393 $4,750 $4,500 $4,939 $5,225 $5,319 $7,746 $6,998 $7,475 $8,563 $8,418 $0 $5,000 $10,000 $15,000 $20,000 $25,000 $30,000 $35,000 $40,000 Q2-17 Q3-17 Q4-17 Q1-18 Q2-18 Other Expense Occupancy / Telephone Data Processing Cost
Slide 14: Efficiency Ratio
14 68.60% 76.30% 72.6% 81.7% 78.0% 68.6% 62.4% 71.1% 73.9% 58.9% 64.0% 57.8% 58.4% 40% 50% 60% 70% 80% 90% 100% 110% GAAP - Efficiency 67.5% 68.2% 69.1% 69.6% 64.8% 63.1% 60.8% 64.7% 61.2% 57.7% 52.6% 57.1% 57.3% 40% 50% 60% 70% 80% 90% 100% 110% Adjusted - Efficiency 1 1 Non - GAAP measure, see “Ex
Slide 15: Total Loans Outstanding
15 Total Loans Outstanding (in millions) • Second quarter loans totaled $3.9 billion, an increase of $644 million or 19% from year - ago levels. Adjusting for acquisitions, loans grew $237 million or 7% year over year . • Experienced higher prepayments quarter over quarter on the nonacquired origina
Slide 16: Deposit Balances
16 • Total deposits have increased 18% year over year, and declined seasonally quarter over quarter. • Transaction accounts represent 52% of total deposits, and have increased 9 % year over year. • Brokered time deposits increased quarter over quarter, as we reduced our balance of advances from the
Slide 17: Average Deposit Balances and Cost
17 (1) Beta calculated using the change in deposit costs 2Q18 vs 2Q17 divided by the 75bps change in Fed Funds rate from June 30, 2017 to June 30, 2018 Average Deposit Balances and Cost Our focus on organic growth and relationship - based funding, in combination with our innovative analytics platfor
Slide 18: Credit Quality
18 Net Charge - offs Nonperforming Loans ALLL $26,000 $26,232 $27,122 $28,118 $28,924 0.95% 0.91% 0.90% 0.90% 0.88% 0.78% 0.77% 0.71% 0.72% 0.73% 2Q 17 3Q 17 4Q 17 1Q 18 2Q 18 ALLL ALLL Ratio - Non-Acquired ALLL Ratio - Total Provision for Loan Losses $279 ($101) $1,336 $1 $1,690 - 0.01% 0.03% 0.14%
Slide 19: Maintaining Strong Capital to Support Balanced Growth
Maintaining Strong Capital to Support Balanced Growth Opportunities 19 Tangible Book Value / Book Value Per Share $10.55 $10.95 $11.15 $11.39 $11.67 $13.29 $13.66 $14.70 $14.94 $15.18 2Q 17 3Q 17 4Q 17 1Q 18 2Q 18 Tangible Book Value Per Share Book Value Per Share 11.2% 12.8% 13.5% 14.8% 13.5% 2Q 17
Slide 20: Agenda: Differentiated Strategy
Agenda 20 ABOUT SEACOAST BANK 1 COMPANY PERFORMANCE 2 SEACOAST’S DIFFERENTIATED STRATEGY 3 OUTLOOK 4
Slide 21: Seacoast's Differentiated Strategy
21 Experienced Board & Management Team Comprehensive Customer Servicing Model Track Record of Value - Creating Acquisitions Expanding Analytical & Digital Capabilities Well - Positioned to Benefit From Florida Market Focused on Controls Seacoast’s Differentiated Strategy
Slide 22: Meeting Customer Needs Through an Evolving Distribution Network
DISTRIBUTION NETWORK 22 Meeting Customer Needs Profitably Through an Evolving Distribution Network Strategic Execution Framework BRANCH COMMERCIAL BANKING OFFICE MOBILE ONLINE ATMs CALL CENTER CUSTOMER’S OFFICE Talent, Technology and Analytics ACQUIRE CUSTOMERS DEEPEN RELATIONSHIPS BROADEN SERVICES
Slide 23: Balanced Growth Strategy Delivering Results Since January 2014
23 $0.0 $1.0 $2.0 $3.0 $4.0 $5.0 Total Excluding Acquisitions Total Including Acquisitions $0.0 $1.0 $2.0 $3.0 $4.0 $5.0 Total Excluding Acquisitions Total Including Acquisitions Organic Deposit Growth Up 28%, 143% Including M&A Organic Loan Growth Up 85%, 204% Including M&A Balanced Growth Strategy
Slide 24: Focus On Business Banking Driving Growth in Loans and Deposits
24 $1,827 $1,841 $2,056 $2,124 $2,503 $2,527 $2,561 $ $500 $1,000 $1,500 $2,000 $2,500 $3,000 Dec-16 Mar-17 Jun-17 Sep-17 Dec-17 Mar-18 Jun-18 $1,881 $1,841 $2,056 $2,124 $2,503 $2,538 $2,599 $ $500 $1,000 $1,500 $2,000 $2,500 $3,000 Dec-16 Mar-17 Jun-17 Sep-17 Dec-17 Mar-17 Jun-18 Focus On Business
Slide 25: Seacoast Uses Data and Machine Learning to Drive Value Creation
Unlike Other Community Banks, Seacoast Uses its Vast Data Set and Machine Learning to Drive Value Creation Face to Face Outbound Call Inbound Call Email ATMs Online Banking Direct Mail Mobile Banking 25 Unique Approach to Serving Our Customers ( Patent Pending ) Behavioral & Financial Data Leveragin
Slide 26: Digital Servicing is Key to Increasing Customer Value
26 Half of all routine branch transactions have been shifted to lower cost channels like ATMs and Mobile. This gives Seacoast flexibility as it evolves its distribution network. Digital Servicing is Key to Increasing Customer Value … And Seacoast is Aggressively Moving Routine Transactions to ATMs a
Slide 27: Growing While Rationalizing Branches
As a Result, Seacoast is Growing While Rationalizing Branches Seacoast continues to create shareholder value via operating leverage in its branch network. As of 2Q 2018, Deposits Increased 160% While Branches Increased Only 4 4% S ince YE 2013 27 $1,806 $2,417 $2,844 $3,523 $ 4,593 $4,697 $53 $56 $6
Slide 28: Seacoast's Differentiated Strategy
28 Experienced Board & Management Team Comprehensive Customer Servicing Model Track Record of Value - Creating Acquisitions Expanding Analytical & Digital Capabilities Well - Positioned to Benefit From Florida Market Focused on Controls Seacoast’s Differentiated Strategy
Slide 29: Advantages in Credit Risk Management
29 We Have a Number of Advantages Related to Our Approach to Credit Risk Management 1 Strong, skilled, independent underwriting teams that confirm solid, multiple repayment sources 2 Well - defined portfolio limits and elevated credit portfolio management/monitoring 3 Digestible loan sizes and no sy
Slide 30: Strong Growth Intentionally Balanced, Not Dependent on CRE Loans
$0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 $4,000 $4,500 Dec, 2013 Dec, 2014 Dec, 2015 Dec, 2016 Dec, 2017 Q2 18 Construction Factoring Consumer Marine Other C&I OOCRE Income CRE Residential 30 Strong Growth Has Been Intentionally Balanced and Not Dependent on CRE Loans Loans Outstanding $ Mi
Slide 31: Conservative Risk Profile
31 Investor Presentation Top 10 loan relationships represent 33% of total risk based capital Seacoast Conservative Risk Profile Well Positioned For Sustainable Value Creation $332,000 Down 41% Average Commercial Loan Size Change in Dollars (since FYE 2011)
Slide 32: Our Approach To CRE Is Very Different Than Florida Peers
32 Investor Presentation CRE loans as a percent of total capital remain relatively flat and intentionally below Florida peers (196% vs 254% peer mean) 225% 290% 191% 257% 196% 254% 100% 150% 200% 250% 300% 350% SBCF Florida Peers Q4 2016 Q4 2017 Q1 2018 CRE loans as a Percent of T otal C apital Sour
Slide 33: Seacoast's Differentiated Strategy
33 Experienced Board & Management Team Comprehensive Customer Servicing Model Track Record of Value - Creating Acquisitions Expanding Analytical & Digital Capabilities Well - Positioned to Benefit From Florida Market Focused on Controls Seacoast’s Differentiated Strategy
Slide 34: Acquisition Strategy Expands Customer Franchise
34 Acquisition Strategy Expands Customer Franchise GulfShore Bank April 2017 BMO Harris Bank Orlando Operations June 2016 Floridian Financial Group March 2016 Grand Bank July 2015 BankFIRST October 2014 2014 2015 2016 2017 20% a verage IRR 4th largest Florida bank, up from 6th in 2014 #1 Florida hea
Slide 35: Seacoast's Differentiated Strategy
35 Experienced Board & Management Team Comprehensive Customer Servicing Model Track Record of Value - Creating Acquisitions Expanding Analytical & Digital Capabilities Well - Positioned to Benefit From Florida Market Focused on Controls Seacoast’s Differentiated Strategy
Slide 36: The Florida Market
Southwest Florida Pop: 1,570,228 Pop Growth: 9.6% Treasure Coast/ Palm Beach Co. Pop: 1,956,515 Growth: 7.3% I - 4 Corridor Pop: 7,128,386 Growth: 8.5% *US Census Data Among the top 10 fastest growing states Surpassed New York to become the third largest state in 2014 Florida’s economy accelerating
Slide 37: Rapid Decline in Florida Headquartered Banks Increases Scarcity Value
37 Number of Banks Headquartered in Florida per Year Rapid Decline in Florida Headquartered Banks Increases Seacoast’s Scarcity Value Source: SNL Financial and FDIC.gov. Note: Includes Commercial Banks, Savings Banks, and Savings & Loan Associations. Number of banks measured at year end with the exc
Slide 38: Seacoast's Differentiated Strategy
38 Experienced Board & Management Team Comprehensive Customer Servicing Model Track Record of Value - Creating Acquisitions Expanding Analytical & Digital Capabilities Well - Positioned to Benefit From Florida Market Focused on Controls Seacoast’s Differentiated Strategy
Slide 39: Strength in Data and Analytics: Customer Profitability
39 Because of Our Strength In Data And Analytics, We Can Examine: We Know Our Customers’ Profitability and Manage Them Accordingly Customer Potential Low High Current Value High Retain & Engage Retain & Grow Low Manage & Lower Cost to Serve Grow! With this, We Can See the Characteristics and Behavio
Slide 40: Understanding the Path to Value Creation at a Customer Level
Median 75th Percentile 40 Opportunity Sizing Engine ( Patent Pending ) Consumer Lifetime Value Small Business Lifetime Value 3x Median 75th Percentile 5x Median 75th Percentile 3x Commercial Lifetime Value Source: Seacoast Proprietary Data Understanding the Path to Value Creation at a Customer Level
Slide 41: Opportunity Sizing Engine
Opportunity Sizing Engine Used to understand precise tactics to generate value for customers and shareholders 41 Bringing Together Marketing Automation, Customer Life Time Value (“CLTV”) and the Opportunity Sizing Engine CLTV Used for understanding the characteristics of value and potential at an in
Slide 42: Seacoast's Differentiated Strategy
42 Experienced Board & Management Team Comprehensive Customer Servicing Model Track Record of Value - Creating Acquisitions Expanding Analytical & Digital Capabilities Well - Positioned to Benefit From Florida Market Focused on Controls Seacoast’s Differentiated Strategy
Slide 43: Revitalized Board Aligned with Our Balanced Growth Strategy
43 Revitalized Board Aligned with Our Balanced Growth Strategy ADDITIONS Herb Lurie 2016 Jacqueline Bradley May 2015 Maryann Goebel Feb. 2014 Julie Daum October 2013 Dennis Arczynski July 2013 Timothy Huval 2016 2013 2014 2015 2016 2017 Al Monserrat Feb 201 7
Slide 44: We Have Methodically Added Strong Talent in Key Areas
44 We Have Methodically Added Strong Talent in Key Areas Dennis S. Hudson III Chairman & CEO Charles M. Shaffer CFO & Head of Strategy Charles K. Cross Jr. Executive Vice President & Commercial Banking Executive Julie Kleffel Executive Vice President & Community Banking Executive Joe Forlenza Chief
Slide 45: Agenda: Outlook
Agenda 45 ABOUT SEACOAST BANK 1 COMPANY PERFORMANCE 2 SEACOAST’S DIFFERENTIATED STRATEGY 3 OUTLOOK 4
Slide 46: Our Future Outlook is Based on Four Key Principles
46 Our Future Outlook is Based on Four Key Principles 1 Our primary driver for growth will be strong performance from our business units 2 Our goal is to continue to drive profitability and growth to the maximum level without increasing our overall risk profile 3 Opportunistic acquisitions will be a
Slide 47: Vision 2020 Innovation Plan
How We Sell • Continue to develop direct sales channels and offerings based on customer needs and preferences • Simplify processes for our customers and bankers • Reduce our cost to acquire How We Service • We are outpacing our peers in engaging our customers with self - serve options for routine ba
Slide 48: Reiterating Vision 2020 Objectives
Reiterating Vision 2020 Objectives 48 • We remain confident in our ability to achieve our Vision 2020 targets announced early last year. We continue to monitor the imp act of the Tax Cuts and Jobs Act of 2017 and believe the impact of this important legislation will more fully materialize in the mar
Slide 49: Contact Details
Charles M. Shaffer Executive Vice President Chief Financial Officer (772) 221 - 7003 Chuck.Shaffer@seacoastbank.com INVESTOR RELATIONS www.SeacoastBanking.com NASDAQ: SBCF Contact Details: Seacoast Banking Corporation of Florida 49
Slide 50: +Years
+YEARS
Slide 51: Explanation of Certain Non-GAAP Financial Measures
This presentation contains financial information determined by methods other than Generally Accepted Accounting Principles (“GAAP”) . The financial highlights provide reconciliations between GAAP net income and adjusted net income, GAAP income and adjusted pretax, preprovision income . Management us
Slide 52: GAAP to Non-GAAP Reconciliation
( Q2 17 – Q2 18) GAAP to Non - GAAP Reconciliation 52 (Dollars in thousands except per share data) Second Quarter: 2018 First Quarter: 2018 Fourth Quarter: 2017 Third Quarter: 2017Second Quarter: 2017 Net income (loss) 16,964 18,027 13,047 14,216 7,676 Gain on sale of VISA Stock 0 0 (15,153) 47 (21)
Slide 53: GAAP to Non-GAAP Reconciliation
GAAP to Non - GAAP Reconciliation ( Q2 17 – Q2 18) 53 (Dollars in thousands) Second Quarter: 2018 First Quarter: 2018 Fourth Quarter: 2017 Third Quarter: 2017Second Quarter: 2017 Adjusted Revenue 62,976 62,160 59,603 57,230 54,623 Impact of FTE adjustment 87 91 174 154 164 Adjusted Revenue on a full
Slide 54: Retail and Call Center Associates Connect With Customer Opportunities
54 Retail and Call Center Associates Connect With Customer Opportunities via Proprietary Software, Fueled by Analytics and Automation Connections portal allows the Retail team to drill down into the Associate profile to view their customer reach - outs, activity trends, and assigned reach - outs tha
Slide 55: Commercial Bankers Utilize Proprietary Software and Advanced Analytics
55 Commercial Bankers Utilize Proprietary Software, Fueled by Advanced Analytics, to Grow Their Portfolio Profitability…. Commercial Banking portal (called Relationship Profitability System or RPS) provides each Banker with a summary of their portfolio. K ey performance indicators on one dashboard.
Slide 56: Commercial Bankers Can Visualize Profitability Levers
56 Commercial Bankers Can Easily Visualize Profitability Levers For Their Portfolio… Commercial Banking portal shows component parts or waterfall of customer contribution at the portfolio level as well as at the customer level
Slide 57: Alerted to Changes in Customer Value and Behavior Daily
57 …and are Alerted to Changes in Customer V alue and Behavior on a Daily B asis. Other alerts in Commercial Banking portal include loan pay - downs and large deposit balance fluctuations… …as well as additional opportunities to serve customers. Alerts are also delivered to Bankers daily via email.
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