Camden National Corporation · NASDAQ:CAC
Camden National — Shareholder Meeting (April 2013)
51 slides from Camden National's shareholder meeting presentation, Apr 30, 2013
Slide 1: Camden National Corporation
© Camden National Corporation
Slide 2: Welcome to the 2013 Annual Shareholder's Meeting
Welcome to the 2013 Annual Shareholder’s Meeting Karen W. Stanley Chairman of the Board
Slide 3: Official Meeting Notice
Official Meeting Notice Sue W estfall Recording Secretary
Slide 4: Agenda
Agenda • Business Meeting • Introductions • Reading of the Minutes • Shareholder Voting • Presentations • Chairman’s Remarks – Karen Stanley • Financial Results – Deborah Jordan • Strategic Update – Greg Dufour • Questions and Answers
Slide 5: Camden National Bank Board of Directors
Camden National Bank Board of Directors • Karen Stanley, Chair • Gregory Dufour, President/CEO • Ann Bresnahan • William Dubord • David Flanagan • John Holmes • James Markos , Jr. • Robert Merrill • Francis O’Hara , Jr. • John Rohman • Rosemary Weymouth
Slide 6: Camden National Corporation Board of Directors
Camden National Corporation Board of Directors • Karen Stanley, Chair • Gregory Dufour, President/CEO • Ann Bresnahan • Robert Campbell • David Flanagan • Craig Gunderson • John Holmes • James Page , Ph.D. • John Rohman • Robin Sawyer , CPA
Slide 7: Acadia Trust Board of Directors
Acadia Trust Board of Directors • Gregory Dufour, Chair • Ann Bresnahan • Robert Campbell • Rendle Jones • Stephen Tall , President/CEO
Slide 8: Camden National Corporation Senior Management Team
Camden National Corporation Senior Management Team Gregory Dufour , President and CEO Joanne Campbell , EVP - Risk Management Officer Carolyn Crosby , SVP - Human Resources & Development Peter Greene , EVP - Operations & Technology Deborah Jordan , CPA, EVP - Chief Financial Officer Robert McKay , S
Slide 9: Meeting Minutes
Meeting Minutes Susan M. Westfall Recording Secretary
Slide 10: Proposals: Election of Directors, Say on Pay, Ratification of Accountant
• Proposal 1: Election of Directors • David C. Flanagan • James H. Page, Ph.D. • Robin A . Sawyer, CPA • Karen W. Stanley • Proposal 2: “Say On Pay” • Proposal 3 : Ratification of Registered Public Accountant • Berry, Dunn, McNeil and Parker • Other Business, Matters, or Proposals Proposals
Slide 11: Judges of Election
Camden National Corporation Judges of Election Paul Gibbons Ann Bixler Orman Goodwin , Jr. Proxies Thomas Jackson Jeffrey Weymouth Alternates Parker Laite , Jr. Arthur Sprowl
Slide 12: Submission of Proxy Votes
Submission of Proxy Votes
Slide 13: Chairman's Remarks
Chairman’s Remarks Karen W. Stanley Chair of the Board
Slide 14: Awards and Accolades
“Best Bank in Knox & Waldo Counties” by Village Soup One of “America’s Most Trustworthy Companies ” by Forbes “Financial Institution of the Year” by Finance Authority of Maine Awards and Accolades
Slide 15: Branch Acquisition
Source: SNL Financial Fills in Camden National’s footprint and increases the total branch network from 38 to 50 banking locations Acquisition Team • Peter Greene • Debbie Jordan • June Parent • Carolyn Crosby • Scott Buckheit • Leslie Eaton • Tim Pratt • Jennifer Roper • Dan Swindler • Scott Westhri
Slide 16: Building Long-Term Value
Building Long - Term Value • Revenue Growth through building Market Share • Balancing Risk/Reward • Capital Management Strategies • Cash Dividend Increase of 8% • Retirements • Director Rendle Jones • Senior Vice President Jack Williams
Slide 17: 2012 Financial Highlights, First Quarter 2013 Results and Branch Acquisition Update
2012 Financial Highlights, First Quarter 2013 Financial Results and Branch Acquisition Update Deborah Jordan Chief Financial Officer
Slide 18: 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
Slide 19: 2012 Financial Highlights
2012 Financial Highlights • Growth in loans and deposits • Net income of $23.4 million and return on equity of 10.31% • Improved credit quality • Maintained strong capital position • Continued outperformance to peer groups
Slide 20: First Quarter 2013 Financial Results
First Quarter 2013 Financial Results March 31, 2013 2012 Favor. (Unfav.) (in millions, except per share) $ % Net Interest Income 19.2$ 18.4$ 0.8$ 4% Loan Loss Provision 0.7 1.0 0.3 30% Fee Income 6.3 5.2 1.1 21% Operating Expenses 16.5 12.9 (3.6) (28%) Income Taxes 2.6 3.1 0.5 16% Net Income 5.7$ 6.
Slide 21: Return on Average Equity
Proxy Peer – Average of 21 p ublicly traded c ommercial and savings banks in the Northeast BHCPR Peer – Average of 351 bank holding companies with consolidated assets between $1 and $3 billion Source: SNL Financial First Quarter 2013 Financial Results Return on Average Equity 9.15% 12.81% 12.42% 12.
Slide 22: Loan Charge-offs to Average Loans
First Quarter 2013 Financial Results Loan Charge - offs to Average Loans 0.31% 0.37% 0.28% 0.26% 0.24% 0.09% 0.00% 0.20% 0.40% 0.60% 0.80% 1.00% 1.20% 1.40% 1.60% 2008 2009 2010 2011 2011 1Q 2013 Annualized CAC Proxy Peer BHCPR Proxy Peer – Average of 21 p ublicly traded c ommercial and savings bank
Slide 23: Efficiency Ratio
First Quarter 2013 Financial Results Efficiency Ratio 52.44% 54.26% 55.74% 54.68% 57.45% 63.88% 25.00% 35.00% 45.00% 55.00% 65.00% 75.00% 85.00% 2008 2009 2010 2011 2011 1Q 2013 CAC Proxy Peer BHCPR Proxy Peer – Average of 21 p ublicly traded c ommercial and savings banks in the Northeast BHCPR Peer
Slide 24: Total Risk Based Capital
First Quarter 2013 Financial Results Total Risk Based Capital 12.32% 13.49% 15.05% 15.95% 15.56% 15.60% 8.00% 9.00% 10.00% 11.00% 12.00% 13.00% 14.00% 15.00% 16.00% 17.00% 2008 2009 2010 2011 2012 1Q 2013 CAC Proxy Peer BHCPR Proxy Peer – Average of 21 p ublicly traded c ommercial and savings banks
Slide 25: Branch Acquisition Update Summary
Actual Results Original Projections Conversion date Oct 29, 2012 Jun – Aug 2012 Branches 14 15 Deposits acquired (millions) $287 $414 Pro - forma market share in State 4 th position 3 rd position Loans acquired (millions) $6 $14 Purchase Price (a) (millions) $11 $21 (a) Purchase Price - Deposit prem
Slide 26: Change in Funding Profile
• Growth in Core Deposits of $359 million or 35% • Saved over $6 million in interest expense with lower cost of funds • Loan to deposit ratio reduced to 81% from 97% Branch Acquisition Update Change in Funding Profile Core Deposits 49% Borrowing 32% Retail CDs 19% 3/31/12 $2.1 Billion Cost of Funds
Slide 27: Deposit Market Share
Source: FDIC Deposit Market Share data as of 6/30/12 adjusted for deposits acquired Institution # of Branches Deposits in Market ($000) Market Share 1 TD Bank 55 3,708,955 16.2% 2 Key Bank 61 2,662,362 11.7% 3 Bangor Savings Bank 58 2,019,820 8.8% 4 Camden National Bank 50 1,899,374 8.3% 5 Bank of A
Slide 28: Branch Acquisition Financial Metrics
Change in EPS Accretion due to: • Lower Net Interest Income – 0.40% decline in 10 year treasury rate and securities portfolio lower due to level of acquired deposits • Lower Deposit Fees – 40% reduction in number of acquired checking accounts Branch Acquisition Update Financial Metrics • Slight EPS
Slide 29: CEO Comments
Gregory A. Dufour President and Chief Executive Officer CEO Comments
Slide 30: Economic and Industry Overview, Strategic Update and Shareholder Return
Economic and Industry Overview, Strategic Update and Shareholder Return
Slide 31: Economic Overview
• Minimal economic growth • Risk of low/no population growth • Risk of low/no consumer and business demand • Prolonged period of low interest rates • Risk of continued “Margin Compression” • Risk of “spikes” in interest rates and inflation • Concerns regarding global events and local impact • Risk o
Slide 32: Industry Overview
• Increased regulation • Increased capital requirements • Uneven playing field Industry Overview
Slide 33: Increased Regulation
• Dodd - Frank Act (2010) • 3,900 pages of proposed and final rules • Creation of the Consumer Financial Protection Bureau (“CFPB”) • Escalating cost of compliance Industry Overview Increased Regulation
Slide 34: Increased Regulation – Residential Mortgages
Industry Overview Increased Regulation – Residential mortgages
Slide 35: Increased Regulation
• What this means to us is … • Some rules are well meaning – others will deny credit to otherwise worthy borrowers • CFPB – not accountable to Congress • Increased costs impacts service and shareholder value Industry Overview Increased Regulation
Slide 36: Increased Capital Requirements
• Basel III • International capital rules for large, multi - national banks • Proposed to be applied to community banks • Difficult and expensive to measure, track and comply • Alternative minimal capital requirements • Simpler to implement • Negative impact on capital • What this means to us is … •
Slide 37: The Uneven Playing Field
• Mortgage Companies • Credit Unions • What this means to us is … • Mortgage companies are not subject to the same compliance as Banks • Credit Unions have a 35% price advantage • Lack of transparency as compared to banks and publicly traded organizations Industry Overview The Uneven Playing Fi eld
Slide 38: Strategic Update
Strategic Update Succeeding in a challenging environment
Slide 39: 5 Strategic Priorities
• Cultivate a comprehensive relationship - based sales and marketing culture • Enhance the customer and stakeholder experiences through continuous improvement, innovation and organizational effectiveness • Build information systems to better understand customer behaviors, manage relationships and ad
Slide 40: Selected 2012 Accomplishments: Sales and Marketing Culture
Strategic Update Selected 2012 Accomplishments Cultivate a relationship - based sales and marketing culture • Established three commercial lending niche products - $3 million of balances • Phase II of brand campaign • 2012 Finance Authority of Maine’s “Financial Institution of the Year”
Slide 41: Selected 2012 Accomplishments: Customer Experience
Strategic Update Selected 2012 Accomplishments Enhance the customer and stakeholder experiences • Established department level service metrics • Implemented online mortgage applications and online account opening (2013) • Reduced Debit Card issuance from 10 days to 2 days
Slide 42: Selected 2012 Accomplishments: Management Information Systems
Strategic Update Selected 2012 Accomplishments Build management information systems to better understand and manage customer relationships • Established Sharepoint and associated management information tools • Transitioned Acadia Trust to “state of the art” SEI investment platform
Slide 43: Selected 2012 Accomplishments: Convenient Customer Service
Strategic Update Selected 2012 Accomplishments Create convenient and seamless ways to serve and interact with our customers • Expanded Customer Assistance Center hours and staff • Implemented “Smart” ATM technology • Created Android and iPhone apps
Slide 44: Selected 2012 Accomplishments: Leaders and Engaged Stakeholders
Strategic Update Selected 2012 Accomplishments Foster an environment of leaders and engaged Stakeholders • Average training hours: 47.4 per FTE • 76% participation in Wellness program • 21,000 hours of employee volunteering
Slide 45: Shareholder Return
Shareholder Return
Slide 46: Shareholder Return: Consistent Performance
$0.45 $0.55 $0.60 $0.63 $0.64 $0.68 $0.72 $0.80 $1.30 $0.88 $0.96 $0.99 $1.00 $1.00 $1.50 $1.00 $1.08 $0.00 $0.20 $0.40 $0.60 $0.80 $1.00 $1.20 $1.40 $1.60 $1.80 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013* Dividends Per Share Source: SNL Financial *1 st Q 20
Slide 47: Tangible Book Value Growth
Shareholder Return Tangible Book Value Growth $15.62 $18.86 $20.91 $22.66 $23.68 $13.59 $18.49 $21.28 $12.15 $- $5.00 $10.00 $15.00 $20.00 $25.00 $30.00 2008 2009 2010 2011 2012 CAC Proxy Peer SNL U.S. Bank $1B-$5B Proxy Peer – Average of 21 publicly traded commercial and savings banks in the Northe
Slide 48: We are positioned to succeed!
Distribution • Increased market share in Maine’s stronger markets • Web and mobile Products • Full product set: Commercial & Retail banking, Brokerage and Wealth Management • Online applications and account openings Customers • Serving over 100,000 customers – 30% more than a year ago Capital • Long
Slide 49: Questions and Answers
Questions and Answers
Slide 50: Supplemental Information
Supplemental Information
Slide 51: Proxy Peer Group
Proxy Peer Group Alliance Financial Corporation - NY Arrow Financial Corporation - NY Bar Harbor Bankshares - ME Berkshire Hills Bancorp, Inc. - MA Brookline Bancorp, Inc. - MA Canandaigua National Corporation - NY Century Bancorp, Inc. - MA Enterprise Bancorp, Inc. - MA Financial Institutions, Inc.