Equity Bancshares, Inc. · NYSE:EQBK
Equity Bancshares — Q1 2021 Earnings Presentation
37 slides from Equity Bancshares's earnings presentation, Apr 20, 2021
Slide 1: First Quarter 2021 Results Presentation
First Quarter 2021 Results Presentation April 21, 2021 Exhibit 99.2
Slide 2: Disclaimers: Special Note Concerning Forward-Looking Statements
Disclaimers Special Note Concerning Forward-Looking Statements This press release contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements re
Slide 3: EQBK's Value Proposition
EQBK’s Value Proposition Market Diversification and Strategy for Growth 2, Experienced and Invested Management Team Lom Conservative Credit Culture and Effective 1000, Risk Management and Mitigation Robust Funding Capacity, Anchored by a Diverse, Low-Cost Deposit Base Focus on Efficient Performance
Slide 4: Franchise Overview
© Franchise Overview ‘| Western KS Topeka ‘| Kansas city © Western MO © Ozark Mountain Southeast KS
Slide 5: Executive Leadership
Executive Leadership 4 Founded Equity Bank in 2002 2018 EY Entrepreneur of the Year National Finalist 2014 Most Influential CEO, Wichita Business Journal Served as Regional President of Sunflower Bank prior to forming Equity Bank Served as Director of Sales and Marketing for Koch Industries Brad Ell
Slide 6: Diverse Market Segments
Diverse Market Segments 5 Source: S&P Market Intelligence. Equity Bancshares, Inc. operating market reported above includes all bank locations and counties in which Equity Bank operates. Diverse market segments with economies based on transportation, manufacturing and healthcare Top employers in the
Slide 7: Continue Building Value via Strategic Execution
Continue Building Value via Strategic Execution 6 2009 $8.8MM of TARP issued Opened 2 branches in Overland Park, KS 2014 Repurchased 1.3mm shares Refinanced TARP with Loan Close/Sell 3 branches and opened branch at Waterfront 2012 First Community Bancshares (FCB) merger $20.4M Capital Raise 2011 Rep
Slide 8: Proven Track Record of Executing on M&A
7 Proven Track Record of Executing on M&A Since July 2015, EQBK has closed and integrated 9 bank acquisitions Pricing Multiples Transaction Impact
Slide 9: Uniquely Positioned for Growth
8 Uniquely Positioned for Growth There are over 650 bank offices with deposits less than $750MM in our operating market.
Slide 10: Equity Bank Today
9 Equity Bank Today(1) Percentage of growth from January 31, 2020; ‘Today’ numbers represent results as of January 31, 2021. Checking Accounts 81,498 Online Banking Users 56,890 Bill Pay Subscribers 19,571 117,628 +2% Total Deposit Accounts $825M +60% NIB Deposits 13,040 +11% Business Checking 51.7%
Slide 11: Diversified Loan Portfolio
Diversified Loan Portfolio(1, 2) 10 Year-to-Date Loan Yield 4.61% 5.43% 5.74% 5.73% For financial statement reporting, management considers other factors in addition to purpose when assessing risk and identifying reporting classes. As such, the above is not intended to reconcile to the Company’s loa
Slide 12: Credit Quality & Capital Ratios
Credit Quality & Capital Ratios 11 Non-GAAP financial measure. See the non-GAAP reconciliation at the end of this presentation. (1) Capital Ratios Total Reserve Ratio Classified Assets
Slide 13: Asset Quality – Quarter-over-Quarter
Asset Quality – Quarter-over-Quarter 12 Nonperforming Assets Net Charge-Offs (NCO)/ Average Loans Nonaccrual Detail Includes loans 90+ days past due and other repossessed assets which are not highlighted in the table. Excludes Bank owned branch assets, totaling $1.0M, classified as Other Real Estate
Slide 14: Bank Liquidity & Dividend Capacity
Bank Liquidity & Dividend Capacity 13 Dividend Capacity from the Bank Liquidity Analysis Amortized Cost Carrying Value Unrealized Gain / (Loss) Description Portfolio Characteristics
Slide 15: Tangible Book Value Growth
Tangible Book Value Growth 14 Tangible Book Value per Share(1) and Tangible Common Equity (1) TBV CAGR 2017 - Q1 2021: 9.95% Non-GAAP financial measure. See the non-GAAP reconciliation at the end of this presentation.
Slide 16: Tangible Book Value
Tangible Book Value 15 Tangible Book Value per Share(1) Intra-Quarter movement Non-GAAP financial measure. See the non-GAAP reconciliation at the end of this presentation. Common shares outstanding of 14,383,913 as of 3/31/2021 used as the denominator for all calculations with the exception of Treas
Slide 17: Strong Core Deposit Franchise
Fully integrated digital banking platform with an adoption rate of 51.7% among core banking customers Mobile deposit active users up 67% year over year 16 Strong Core Deposit Franchise For the quarter ended March 31, 2021. Includes interest and non-interest bearing deposits. Core deposits excludes t
Slide 18: Core Deposit Growth
17 Core Deposit Growth Includes the impact of non-interest bearing deposits Dollars in millions Cost of Deposits(1) 0.27% 0.96% 1.30% 0.91% 0.52%
Slide 19: Robust Growth
Robust Growth 18 Gross Loans ($Millions) Total Deposits ($Millions) Tangible Book Value per Share(1) Pre-Tax, Pre-Provision Net Revenue ($Thousands)(2) Non-GAAP financial measure. See the non-GAAP reconciliation at the end of this presentation. Excludes impact of goodwill impairment charge taken dur
Slide 20: Net Interest Income & Net Interest Margin
Net Interest Income & Net Interest Margin 19 ($) Thousands (1) (1) (1) Excludes the impact of PPP loans. Including these balances the second, third, fourth quarter 2020 and first quarter 2021 results would be 3.49%, 3.47%, 3.88%, and 3.31%, respectively, while YTD 2020 results would be 3.63%. Annual
Slide 21: Interest Income & Net Interest Margin
Interest Income & Net Interest Margin 20 Government Programs PPP fee income decreased due to reduced forgiveness received by borrowers during the quarter. However, due to current period originations, more than $12 million in deferred fee balances were booked during the quarter. Increasing average ba
Slide 22: Income Performance Metrics
Income Performance Metrics 21 Non-GAAP financial measure. Refer to the non-GAAP reconciliation at the end of this presentation. Excludes impact of goodwill impairment recognized during the third quarter 2020. Return on Tangible Common Equity(1) Efficiency Ratio(1) Quarterly ROATCE impacted by COVID-
Slide 23: CECL Results
CECL Results 22 The company adopted ASC 326, Financials Instruments – Credit Losses ( “CECL”), on January 1, 2021. Dollars in thousands Impact of CECL adoption(1) and Subsequent Intra-Quarter Movement
Slide 24: 2021 First Quarter Highlights
23 2021 First Quarter Highlights Non-GAAP financial measure. See the non-GAAP reconciliation at the end of this presentation. Year-over-Year is a comparison to comparable quarter end in previous year Diluted EPS $1.02 Revenue $42.5M ROAE 15.45% $31.7M Net Interest Income + $187M +5% Total Deposits $
Slide 25: First Quarter Highlights - Continued
First Quarter Highlights - Continued 24 Favorable (unfavorable) comparison to previous period. Year-over-Year is a comparison to comparable quarter end in previous year. Quarter-over-Quarter is a comparison to prior quarter end. Non-GAAP financial measure. See the non-GAAP reconciliation at the end
Slide 26: Outlook on Key Business Drivers
25 Outlook on Key Business Drivers Average Deposits $3,000-3,200M $3,578M 3-8% growth Key Driver Q1’21 Results Q1’21 Outlook Average Loans(1) $2,350-$2,450M $2,377M 3-8% growth Net Interest Margin(1) 3.35-3.45% 3.19% Contraction Non-Interest Income $6.2-6.8M $6.7M 10-20% growth Non-Interest Expense
Slide 27: Focus Variables for Outlook & Forecast
26 Focus Variables for Outlook & Forecast Business activity creates opportunity for lending and deposit growth. Pandemic response and resolution will be significant driver. Directly related to credit quality as well as trust in our business. Stimulus efforts and associated effect may have significan
Slide 28: Adjusted Operating Performance Trends – Quarter-over-Quarter
27 Adjusted Operating Performance Trends – Quarter-over-Quarter(1) Adjusted Diluted Earnings Per Share (3) Efficiency Ratio(1,2) & Non-Interest Expense / Average Assets(3) Non-GAAP financial measure. See the non-GAAP reconciliation at the end of this presentation. Does not include gains on sales and
Slide 29: Government Facilitated Lending Programs
28 Government Facilitated Lending Programs Equity was an active participant in the first round of PPP. Funding more than $370M in loans to protect jobs and businesses within our footprint. The management team has worked expeditiously to obtain forgiveness on behalf of our borrowers. Through the end
Slide 30: Appendix
Appendix 29
Slide 31: Selected Income Statement Data
Selected Income Statement Data 30
Slide 32: Selected Balance Sheet Data
Selected Balance Sheet Data 31 Demonstrating balance sheet strength Includes interest-bearing deposits in other banks. Includes Federal Reserve Bank and Federal Home Loan Bank stock. Includes loans held-for-sale.
Slide 33: Capitalization
Capitalization 32 (1) Non-GAAP financial measure. See the non-GAAP reconciliation at the end of this presentation. Maintaining a strong regulatory capital position
Slide 34: Non-GAAP Reconciliations
The subsequent tables present non-GAAP reconciliations of the following calculations: Tangible Common Equity (TCE) to Tangible Assets (TA) Ratio Tangible Book Value per Common Share Return on Average Tangible Common Equity (ROATCE) Efficiency Ratio 33
Slide 35: TCE to TA and Tangible Book Value per Share
TCE to TA and Tangible Book Value per Share 34
Slide 36: ROATCE and Efficiency Ratio
ROATCE and Efficiency Ratio 35
Slide 37: Equity Bancshares, Inc.
EQUITY BANCSHARES, INC. investor.equitybank.com