Pcb Bancorp · NASDAQ:PCB
Pcb Bancorp — Pacific City Financial — Sandler O'Neill + Partners 2019 West Coast Financial Service Conferences
21 slides from Pcb Bancorp's conference presentation, Mar 5, 2019
Slide 1: 2019 West Coast Financial Service Conferences
SANDLER O’NEILL + PARTNERS 2019 West Coast Financial Service Conferences March 5, 2019
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation (and oral statements made regarding the subject of this presentation) contains certain “forward- looking statements” that are based on various facts and derived utilizing numerous important assumptions and are subject to known and unknown risks, uncertainties
Slide 3: Pacific City Profile
Pacific City Profile (1) Company Overview Organic Growth Founded in 2003 $1.70 billion in assets: Purely driven by organic growth Headquartered in Los Angeles, CA Diversified loan portfolio IPO in August 2018 ($45.0 million) Net CRE to Total Risk-based Capital 253.6% Third largest US based Korean-Am
Slide 4: Pacific City Profile (Cont'd)
Pacific City Profile (Cont’d) Equity Information Franchise Footprint NASDAQ: PCB (1) Share Price: $17.00 (1) 52 Week Range: $13.36 - $20.95 Market Cap: $271.5 million (1) (2) Total Outstanding Shares: 15,998,003 (1) Based on equity market data as of 2/28/19 (Source: Bloomberg) (2) As of 2/28/19 *201
Slide 5: Pacific City Recent Financials
Pacific City Recent Financials As of or For the Year Ended 12/31/2018 12/31/2017 Change (1) Income Statement Summary Interest Income $ 83.7 $ 65.3 28.2% 2018 net income of $24.3 million or $1.65 per diluted share Interest Expense 18.0 10.1 77.8% Net Interest Income 65.7 55.2 19.2% $1.70 billion in t
Slide 6: Strong Growth and Performance
Strong Growth and Performance Total Loans ($ in millions) CAGR +15.7% $1,344 $1,195 $1,033 $846 $750 (1) (1) (1) (1) (1) 23.7% 12.8% 22.1% 15.7% 12.5% 2014 2015 2016 2017 2018 (1) Annual loan growth rates *2018 and any quarterly financials are unaudited. 6 your Partner • Choice • Bank
Slide 7: Solid Loan Growth
Solid Loan Growth (1) HFI Loans ($ in millions) HFI Loan Compositions HFI Loans - CAGR +16.3% $1,339 $1,190 Commercial Property - $234 Consumer Residential Property $1,031 $169 $26 17% Owner Occupied $34 2% 22% $140 $844 $34 $733 $129 $115 $29 $858 $30 $817 Commercial and Industrial $717 16% $575 Co
Slide 8: Fixed vs. Variable Loans
Fixed vs. Variable Loans (1) (2) New Loan: Fixed vs. Variable ($ in millions) Fixed vs. Variable Fixed Rate Loans 5.91% 13% (3) 5.48% 5.42% 5.52% @ 5.41% 5.29% Hybrid Loans Variable Rate Loans 21% (3) 66% @ 4.96% $103.7 (3) $85.7 $98.0 $99.0 $63.9 @ 6.31% $38.4 $33.8 $32.0 $22.9 $24.6 $13.3 $10.0 $1
Slide 9: Asset Quality
Asset Quality Net Charge-offs ($ in thousands) Classified Loans ($ in millions) $2,077 $10.4 $9.1 $923 $6.9 0.31% $6.5 1.42% $5.0 $500 0.88% 0.77% $308 0.08% $288 0.42% 0.51% 0.06% 0.03% 0.02% 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 (1) Net Charge-offs Net Charge-offs Ratio Classified Loan
Slide 10: Asset Quality
Asset Quality (1) Nonperforming Assets (NPAs) NPAs/ Total Assets $6.5 0.72% $3.3 $2.4 $2.4 0.23% 0.23% $1.1 0.19% 0.06% 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 (2) Allowance for Loan Losses to HFI Loans Nonperforming Loan (NPL) Coverage 1.29% 1,241% 1.11% 1.10% 1.03% 0.98% 612.6% 394.0% 37
Slide 11: SBA Loan Trends
SBA Loan Trends SBA Loan Sale and Premium ($ in millions) SBA Gain on Sale ($ in millions) 10.43% 7.90% 9.67% 9.30% 9.53% 8.37% 6.96% 6.77% 6.97% 5.76% $119.3 $127.2 $7.9 $7.3 $8.1 $8.9 $100.4 $104.7 $91.7 $5.3 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 SBA Loan Sale SBA Premium Rate (1) SBA
Slide 12: Strong Growth and Performance
Strong Growth and Performance Total Deposits ($ in millions) CAGR +15.8% $1,444 $1,251 $1,092 $939 $803 (1) (1) (1) (1) (1) 19.1% 17.0% 16.2% 14.6% 15.4% 2014 2015 2016 2017 2018 (1) Annual deposit growth rates *2018 and any quarterly financials are unaudited. 12 your Partner • Choice • Bank
Slide 13: Solid Core Deposit Growth
Solid Core Deposit Growth (2) Core Deposit Trend ($ in millions) Total Deposit Compositions Core Deposit (1) Non-Core Deposit (1) NOW, Savings, and MMDA CAGR +15.3% CAGR +17.8% 22% Non-Jumbo CD 33% $1,444 $1,251 $324 $1,092 $282 Demand Deposits $939 State CD $803 $224 23% $182 7% $168 $969 $1,120 $7
Slide 14: Funds Management
Funds Management Net Loan to Deposit Comparison ($ in millions) Cost of Funds ($ in millions) 94.5% 2.50% 2.25% 2.00% 92.2% 92.2% 1.75% 1.50% 1.25% 1.32% 1.47% 0.92% 1.03% 88.1% 88.5% $1,444 $1,118 $1,103 $1,131 $1,382 $1,427 $1,420 $1,001 $1,263 $1,309 $1,331 $948 $1,183 $1,251 $1,217 4Q17 1Q18 2Q1
Slide 15: Strong Earnings Performance
Strong Earnings Performance Net Income ($ in millions) Diluted Earnings Per Share CAGR +19.7% CAGR +13.3% $24.3 $1.65 $1.11 $1.21 $16.4 $1.00 $1.02 $11.8 $12.2 $14.0 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 *2018 and any quarterly financials are unaudited. 15 your Partner • Choice • Bank
Slide 16: Strong Earnings Performance
Strong Earnings Performance ROAA ROAE 1.46% 1.53% 14.67% 14.26% 13.10% 12.47% 1.25% 1.25% 1.22% 12.00% 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 Noninterest Expense ($ in millions) Efficiency Ratio 2.61% 2.73% 66.60% 2.41% 65.30% 63.70% 62.10% 61.80% 2.39% 2.34% 56.52% 56.85% 54.92% 52.79% $
Slide 17: NIM and NII
NIM and NII (1) Loan Yield vs. Cost of Funds Net Interest Income & Net Interest Margin 6.08% 5.54% 5.27% 5.14% 5.21% 4.27% 4.33% 4.17% 4.33% 4.08% 4.09% 4.18% 4.22% 4.23% 3.89% $16.7 $17.9 1.27% $14.9 $15.3 $15.9 0.70% 0.71% 0.70% 0.85% 2014 2015 2016 2017 2018 4Q17 1Q18 2Q18 3Q18 4Q18 Loan Yield Ne
Slide 18: Capital Ratios and BV Per Share
Capital Ratios and BV Per Share (1) Bank Capital Ratios Book Value Per Share CAGR +15.8% 17.2% 16.2% 16.2% 12.5% $13.16 $10.60 $9.48 $7.31 $8.26 Tier 1 Leverage CET 1 Capital Tier 1 Capital Total Captial 2014 2015 2016 2017 2018 (1) As of 12/31/18 *2018 and any quarterly financials are unaudited. 18
Slide 19: Financial Highlights & Investment Opportunities
Financial Highlights & Investment Opportunities Cohesive and Experienced Management Team Proven Track Record of Organic Growth Excellent Asset Quality and Strong Earnings Performance Conservative Credit Culture and Risk Profile with Diversified Loan Portfolio Increased Quarterly Cash Dividend from $
Slide 20: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures Core Deposits are a non-GAAP measure that we use to measure the portion of our total deposits that are thought to be more stable, lower cost and reprice less frequently on average in a rising rate environment. We calculate core deposits as total deposits less time
Slide 21: 2018 Q4 Financial Comparison
2018 Q4 Financial Comparison For the Quarter Ended 12/31/2018 9/30/2018 Change 12/31/2017 Change (1) Income Statement Summary Interest Income $ 23.2 $ 21.5 8.1% $ 17.9 30.0% Interest Expense 5.4 4.8 12.4% 2.9 82.9% Net Interest Income 17.9 16.7 6.8% 14.9 19.6% Nonintrest Income 2.2 2.6 -13.2% 3.4 -3