Stifel Financial Corporation · NYSE:SF
Stifel Financial — Investor Presentation (May 2019)
39 slides from Stifel Financial's investor presentation, May 2019
Slide 1: Investor Presentation May 2019
Investor Presentation May 2019
Slide 2: Disclaimer
Disclaimer Forward-Looking Statements This presentation may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that involve significant risks, assumptions, and uncertainties, including statements relating to the market opportunity and futu
Slide 3: Our Strategy
Our Strategy STIFEL
Slide 4: Strategic Vision
Strategic Vision To build a premier wealth management and investment banking firm Global Wealth Management Institutional Private Asset Bank Equities Fixed Investment Research Client Management Sales + Income Banking Trading Sales + Trading 2,160 financial $33B in total $16.8B in assets Experienced s
Slide 5: A History of Organic Growth & Acquisitions
A History of Organic Growth & Acquisitions 2019 2018 First Empire 2017 Ziegler Wealth MainFirst City Management, 2016 Mooreland Securities Business Eaton Partners Partners Bancshares Inc. 2015 ISM Capital Barclays Wealth & 2014 Investment Management, De La Rosa, Sterne Agee, Oriel Securities, 2013 1
Slide 6: Substantial Performance Improvement in 2018
Substantial Performance Improvement in 2018 millions 2018 2017 Change millions 2018 2017 Change Income Statement Balance Sheet Total net revenue $3,025 $2,928 3% Total assets $24,520 $21,384 15% Pre-tax income $592 $501 18% Bank assets $17,819 $14,996 19% Net income available to common share holders
Slide 7: Stifel Overview
Stifel Overview STIFEL
Slide 8: Stifel – Premier Investment Bank and Wealth Management Firm
Stifel – Premier Investment Bank and Wealth Management Firm Stifel at a Glance 2018 GAAP Net Revenue - $3.0 billion Global Wealth Management (GWM) Institutional Group (IG) 2018 Net Revenue - $2.0 billion 2018 Net Revenue - $1.1 billion Private Client Equity & Fixed Income Capital Raising Stife
Slide 9: Leading broker-dealer providing wealth management and institutional services
Leading broker-dealer providing wealth management and institutional services to consumers and companies Bulge Bracket Boutique Size / scale Firm focus Large distribution Good research Size / scale Trading Growth investor access Firm focus Retail Issues Stability (financial & pers
Slide 10: Well-diversified, Low Risk Business Model with Balanced Retail and Institutional Exposure
Well-diversified, Low Risk Business Model with Balanced Retail and Institutional Exposure Unburdened by capital constraints Low leverage business model and conservative risk management Limited balance sheet risk Stable wealth management business is augmented by profitable and growing institu
Slide 11: A Stable Track Record Through Multiple Business Cycles
A Stable Track Record Through Multiple Business Cycles Non-GAAP Net Revenues(1)(2) ($MM) Total Equity(1) ($MM) $3,500 $3,500 $3,377 $3,168 $3,025 $2,928 $3,000 $3,000 $2,862 $2,738 $2,580 $2,492 $2,500 $2,335 $2,500 $2,320 $2,213 $2,059 $1,978 $2,000 $2,000 $1,594 $1,417 $1,495 $1,500 $1,384 $1,500
Slide 12: Balance Sheet Growth
Balance Sheet Growth $24,520 $24,184 $25,000 $21,384 $20,000 $19,129 Total Assets in Millions $15,000 $13,326 $9,518 $10,000 $9,009 $6,966 $4,952 $5,000 $4,213 $3,167 $1,558 $- 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 1Q19 ` 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 1Q19 T
Slide 13: Bank Drove Significant Balance Sheet & Revenue Growth
Bank Drove Significant Balance Sheet & Revenue Growth Impact of Bank Growth LTM on Consolidated Results Bank growth has been balanced between loans and investments: (mil.) 3/31/2018 3/31/2019 Loans: Total consolidated assets $21,715 $24,184 • Comprised of securities based loans, C&I, and Investment
Slide 14: Global Wealth Management
Global Wealth Management STIFEL
Slide 15: Global Wealth Management (GWM)
Global Wealth Management (GWM) Provides Securities Brokerage Services and Stifel Bank Products Overview National Presence Grown from 600+ financial advisors in 2005 to 2,160 financial advisors currently Proven organic growth and acquirer of private client business Strategy of recruiting experi
Slide 16: Building Scale and Capabilities into a $2 Billion Revenue Segment
Building Scale and Capabilities into a $2Billion Revenue Segment 55 advisors managing ~$5B in AUM March 2018 ~40 advisors managing ~$4B in AUM January 2017 ~100 advisors managing over $20B in AUM December 2015 Private Client ~130 advisors managing ~ $10B in AUM June 2015 Customized
Slide 17: GWM - Private Client Group
GWM - Private Client Group Key Operating Metrics Financial Advisors(1)(2)(3) Branches(1)(2) 2,500 2,291 2,282 400 2,244 369 371 2,152 2,160 361 360 355 2,077 2,103 1,987 2,041 350 330 1,885 1,935 317 2,000 307 285 291 300 272 1,500 250 1,315 196 200 1,000 150 100 500 50 0 0 2008 2009 2010 2011 2012
Slide 18: GWM – Stifel Bancorp, Inc.
GWM – Stifel Bancorp, Inc. Overview Key Statistics (000s) (1)(2) Acquired FirstService Bank, a St. Louis-based, Missouri- Total assets $16,803 chartered commercial bank, in April 2007 Total deposits 15,050 Stifel Financial became a bank holding company and Total equity 1,227 financial services h
Slide 19: Growing Asset Management Capabilities
Growing Asset Management Capabilities Asset Management Subsidiaries with Nearly $33 Billion in Client Assets Assets $12.6 Billion $13.2 Billion $4.1 Billion $3.0 Billion Chicago Baltimore Milwaukee Birmingham Baltimore Offices New York Cincinnati Florham Park, NJ Boston St. Louis New York San Franci
Slide 20: Institutional Group
Institutional Group STIFEL
Slide 21: Institutional Group
Institutional Group Overview Net Revenues ($MM)(2)(3)(4) Provides securities brokerage, trading, research, underwriting and $1,200 $1,111 $1,055 corporate advisory services $997 $976 $1,014 $900 $861 Largest provider of U.S. Equity Research $668 $626 3rd largest Equity trading platform in the U.
Slide 22: Building Scale and Capabilities into a $1 Billion Revenue Segment
Building Scale and Capabilities into a $1Billion Revenue Segment Growth Focused Investment Banking, Research, Sales and Trading July 2010 Core of our Institutional sales, trading and research group December 2005 Enhances European debt capital markets capabilities February 2016 Equities
Slide 23: Institutional Group – Advisory
Institutional Group – Advisory 2010-2019 YTD: Leadership in M&A of Public Companies and deals < $1bn. All Deals < $1 Billion in Value Public Deals < $1 Billion in Value Rank Investment Bank Sell-side Buy-side Total Value Rank Investment Bank Sell-side Buy-side Total Value 1 Goldman Sachs 415 292 707
Slide 24: Institutional Group – Equity Underwriting
Institutional Group – Equity Underwriting Accomplished U.S. Equity Underwriting Franchise – All Equity Transactions All Managed Equity Deals Since 2010 Bookrun Equity Deals Since 2010 ($ in billions) # of $ ($ in billions) # of $ Rank Firm Deals Volume Rank Firm Deals Volume 1 JPMorgan 1,973 $1,049.
Slide 25: Institutional Group – Research
Institutional Group – Research Largest U.S. Equity Research Platform U.S. Equity Research Coverage (1)(2) Stifel Research Highlights Com panies Under Cov er age Largest provider of U.S. Small & Mid-cap Equity Research² Rank Fir m Ov er al l Mid Cap Sm al l Cap 1 Stifel / KB W 1 ,1 9 1 441 320 #1
Slide 26: Institutional Group – Equity Sales and Trading
Institutional Group – Equity Sales and Trading Powerful Platform Spanning North America and Europe Institutional Equity Sales Equity Trading 65 person sales force 21 sales traders located in Baltimore, New York, Boston, San Experts in small and mid cap growth and value Francisco, and London
Slide 27: Institutional Group – Fixed Income Capital Markets
Institutional Group – Fixed Income Capital Markets Strong Fixed Income Brokerage Capabilities Institutional Fixed Income Sales Institutional Fixed Income Trading Comprehensive platform Unmatched distribution network for clients, issuers and debt 85 traders with annual client trade volume appro
Slide 28: Institutional Group – Public Finance
Institutional Group – Public Finance Overview Stifel Public Finance has ranked #1 Specialty sectors: nationally in senior managed, negotiated Education municipal issues for each of the past five years, including again in2018. Local Government/Municipal Healthcare More than one in every 10
Slide 29: First Quarter 2019 Results
First Quarter 2019 Results 29
Slide 30: Highlights & First Quarter Results
Highlights & First Quarter Results • Net Revenue of $770 million, up 3% Y/Y. • Bank Net Interest Margin of 3.17%, up 28 basis points sequentially • Record Net Interest Income of $142 million, up 27% Y/Y. • Non-GAAP Pre-tax Margin of 19%, up 170 bps Y/Y • Record Global Wealth Management Net Revenue o
Slide 31: Segment Results
Segment Results STIFEL
Slide 32: Global Wealth Management
Global Wealth Management Y/Y Sequential GWM Net Revenue $600 millions 1Q19 Change Change $500 Global Wealth Management Revenue Net Revenue (mil) $400 Commissions $110 -8% -6% $300 Principal Transactions $43 -1% 7% Brokerage $153 -6% -3% $200 Asset Management & Service Fees $195 0% -7% $100 Net Inter
Slide 33: Institutional Group
Institutional Group Institutional Group Net Revenue Y/Y Sequential $350 millions 1Q19 Change Change GAAP Net Revenue (mil.) $300 Institutional Revenue $250 $200 Advisory $105 7% -6% $150 Equity $100 Underwriting $28 -47% -46% $50 Brokerage $39 -19% -20% $0 1Q18 2Q18 3Q18 4Q18 1Q19 Total Equity Net R
Slide 34: Revenue & Expenses
Revenue & Expenses STIFEL
Slide 35: Brokerage Revenue and Asset Management & Service Fees
Brokerage Revenue and Asset Management & Service Fees Brokerage Revenue Three Months Ended (000s) 1Q19 1Q18 % Change 4Q18 % Change Global Wealth Management brokerage revenue $153,194 $162,734 -6% $157,331 -3% Institutional brokerage: Equity Capital Markets 38,881 48,085 -19% 48,705 -20% Fixed Income
Slide 36: Investment Banking Revenue
Investment Banking Revenue Investment banking: Three Months Ended (000s) 1Q19 1Q18 % Change 4Q18 % Change Capital raising: Global Wealth Management revenue $8,223 $7,688 7% $7,915 4% Equity Capital Markets 27,859 52,707 -47% 51,839 -46% Fixed Income Capital Markets 20,863 18,294 14% 30,390 -31% Tota
Slide 37: Net Interest Income
Net Interest Income Net Interest Income Growth Average Yields on Balance Sheet $160 1Q19 1Q18 Change 4Q18 %Change $142 $140 $127 Assets: $117 $121 Net Interest Income (mil.) $120 $111 Bank loans 4.15% 3.50% 65 bps 4.11% 4 bps $100 Commercial 4.78% 4.32% 46 bps 4.79% -1 bps $80 Securities based 4.25%
Slide 38: Stifel Bancorp, Inc.
Stifel Bancorp, Inc. % % (mil. except for %'s) 1Q19 1Q18 Change 4Q18 Change Assets: Mortgage Loans 2,928 2,634 11% 2,875 2% Commercial Loans 3,315 2,554 30% 3,304 0% Securities Based Loans 1,861 1,809 3% 1,787 4% Commercial Real Estate 362 102 256% 320 13% Loans Held for Sale 144 261 -45% 206 -30% T
Slide 39: Expenses
Expenses Compensation Ratio Non-GAAP Expenses & Three Months Ended 61.0% 60.5% Pre-tax Income % % 60.0% 59.0% 59.0% 1Q19 1Q18 Change 4Q18 Change 59.0% 58.0% (millions) 57.0% 56.5% 56.0% Compensation $454 $454 0% $444 -2% #DIV/0! 56.0% 55.0% Non-compensation $170 $167 2% $175 -3% #DIV/0! 54.0% 53.0%