Sb Financial Group, Inc. · NASDAQ:SBFG
Sb Financial — Shareholder Meeting (April 2014)
34 slides from Sb Financial's shareholder meeting presentation, Apr 23, 2014
Slide 1: Annual Meeting of Shareholders
Annual Meeting of Shareholders Build on Our Strength April 23, 2014 | Founders Hall at Sauder Village
Slide 2: Annual Meeting Agenda
Annual Meeting Agenda • Introductions • Annual Meeting-Shareholder Proposals • SB Financial Group, Inc. Business Overview • Questions, Comments and Discussion • Voting Results • Adjournment
Slide 3: Shareholder Proposals
Shareholder Proposals • Proposal 1 – to elect three (3) directors to serve for terms of three (3) years each: – Mr. Robert A. Fawcett, Jr. – Mr. Gaylyn J. Finn – Ms. Rita A. Kissner • Proposal 2 – to ratify the appointment of BKD, LLP as the independent registered public accounting firm of SB Financ
Slide 4: Special Guests
Special Guests • Independent Auditor – Mr. Troy Gilstorf, Mr. Scott Hopf, BKD, LLP • Legal Counsel – Mr. Tony Weis, Vorys, Sater, Seymour & Pease, LLP • Local Counsel – Mr. Stan Yoder and Mr. Jim Weaner, of Weaner, Zimmerman, Bacon, & Yoder Ltd. • Investor Relations Counsel – Ms. Renee Ketels, Lambe
Slide 5: State Bank Advisory Board Members
State Bank Advisory Board Members Defiance County • Mr. Jerry Overmier • Mr. Mike McCann Board Liaison: • Mr. Doug McDonald • Ms. Rita Kissner • Ms. Sue Strausbaugh 6
Slide 6: State Bank Advisory Board Members
State Bank Advisory Board Members Fulton County • Ms. Virginia Neuenschwander • Mr. Edward Nofziger Board Liaison: • Mr. Gaylyn Finn • Mr. Joseph O’Neil • Mr. Joseph Short • Mr. Kevin Whitlock 7
Slide 7: State Bank Advisory Board Members
State Bank Advisory Board Members Lima Region • Mr. Joseph Guagenti • Mr. John Johnson Board Liaison: • Mr. Robert Meredith • Mr. Timothy Stolly • Dr. Patrick Chaney • Mr. Ronald Miller 8
Slide 8: State Bank Advisory Board Members
State Bank Advisory Board Members Paulding County • Mr. Rex Williamson • Dr. John Saxton Board Liaison: • Mr. George Carter 9
Slide 9: State Bank Advisory Board Members
State Bank Advisory Board Members Toledo Region • Mr. Steven Bohl • Mr. Ronald King Board Liaison: • Ms. Tracy Sallah • Mr. Gary Cates • Mr. Tom Helberg 10
Slide 10: State Bank Advisory Board Members
State Bank Advisory Board Members Williams County • Mr. Jerry Kneipp • Mr. Glen Newcomer Board Liaison: • Mr. Duane A. Weiss •Mr. William Martin • Mr. Michael Spangler 11
Slide 11: Retired Director: Tom Sauer
SB Financial Group/State Bank Retired Director: Tom Sauer – Served as Director for seven years – Served as member of the Governance and Nominating Committee; Chairman of State Bank Investment Committee
Slide 12: New Director: George Carter
SB Financial Group/State Bank New Director: George Carter – Appointed in August 2013 – CEO/General Manager of Paulding Putnam Electric Cooperative – BS from Oakland University – Member of the Loan Review Committee
Slide 13: New Director: William Martin
SB Financial Group/State Bank New Director: William Martin – Appointed in February 2014 – Executive Vice President and CFO of Spangler Candy Company – BS from Bowling Green State University – Resident of Bryan, OH
Slide 14: SB Financial Group/State Bank Boards of Directors
SB Financial Group/State Bank Boards of Directors Term Expiring 2014 2015 2016 Mr. Robert A. Fawcett, Jr. Mr. George W. Carter Mr. Richard L. Hardgrove* Mr. Gaylyn J. Finn Mr. Gary M. Cates Mr. Mark A. Klein* Ms. Rita A. Kissner* Mr. Timothy J. Stolly Mr. William G. Martin * Indicates an RDSI Board
Slide 15: SB Financial Group Committee Chairpersons
SB Financial Group Committee Chairpersons • Audit Committee – Chair: Rita A. Kissner – Financial Expert: Gaylyn J. Finn • Compensation Committee – Chair: Robert A. Fawcett, Jr. • Governance and Nominating Committee – Chair: Richard L. Hardgrove • Loan Review Committee – Chair: Gaylyn J. Finn
Slide 16: SB Financial Group, Inc. Business Overview
SB Financial Group, Inc. Build on Our Strength Business Overview
Slide 17: Safe Harbor Statement
Safe Harbor Statement Certain statements within this document, which are not statements of historical fact, constitute forward- looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve risks and uncertainties and actual results
Slide 18: Vision: Become a Top-Quartile, Independent Financial Services Company
Vision: Become a Top-Quartile, Independent Financial Services Company • Increase profitability through ongoing diversification of revenue streams • Strengthen penetration in all markets served • Expand product service utilization by new and existing customers • Deliver gains in operational excellenc
Slide 19: What is "Top-Quartile" Performance
What is “Top-Quartile” Performance SBFG Q1 SBFG Peer Group Peer Group SBFG SBFG 2014 2013 Top Quartile * Median* 2012 2011 Return On Assets 0.61% 0.81% 0.97% 0.72% 0.75% 0.26% Net Interest Margin 3.46 3.75 3.89 3.59 3.76 3.81 Non-interest Income/Avg. Assets 1.58 2.19 1.19 0.79 2.33 1.83 Efficiency R
Slide 20: Increase Profitability Through Ongoing Diversification
Increase Profitability Through Ongoing Diversification 2013 Fee Income $14.0 million Service Fees 18.4% Wealth Mortgage Management Banking 18.9% 44.9% Item Processing 10.7% Other 7.1% 21
Slide 21: Increase Profitability Through Ongoing Diversification
Increase Profitability Through Ongoing Diversification 2013 Fee Income • Fee income as a $14.0 million percentage of total Service revenue exceeds 40% Fees 18.4% • Significant capacity exists Wealth to expand relationships Management Mortgage with little additional cost Banking 18.9% • New assets un
Slide 22: Increase Profitability Through Ongoing Diversification
Increase Profitability Through Ongoing Diversification • Concentration on: Geographical Footprint Banking Centers Loan Production Offices – Residential real estate – Government guaranteed credits (SBA, USDA) • Awarded with “Preferred Lender” status on SBA loans
Slide 23: Strengthen Penetration in Markets Served
Strengthen Penetration in Markets Served • Columbus – Since 2010, this region has generated $604 million in mortgage volume – Represents 16% of the loans outstanding – Nearly 2,000 households in existence 24
Slide 24: Strengthen Penetration in Markets Served
Strengthen Penetration in Markets Served • Toledo – Fully staffed with commercial lending, wealth management and retail locations – Makeover of acquired bank now complete – Represents 17% of the loans outstanding 25
Slide 25: Strengthen Penetration in Markets Served
Strengthen Penetration in Markets Served • Defiance – Enhance and maintain our high deposit and commercial lending market share – #2 in Defiance County with a 23% deposit market share – 21% of our total households reside in Defiance 26
Slide 26: Expand Product Service Utilization by New and Existing Customers
Expand Product Service Utilization by New and Existing Customers • 42% of our households use three or more services • 58% of our households have two or less services • Laura Kline named “Client Experience Officer” • 87% of our staff has made a referral to another business line • Branded credit card
Slide 27: Achieve Operational Excellence
Achieve Operational Excellence Efficiency Ratio Comparison • Top-line growth to drive 82.38% upside in above-peer- 80.00% 75.48% 74.43% group efficiency ratio 68.08% 70.57% 67.78% • Management committed 66.18% to consumer technology 60.00% 63.57% 62.94% – Mobiliti® app for smartphone and iPad – Remo
Slide 28: Sustain Asset Quality
Sustain Asset Quality Non-Performing Assets/ Total Assets • SBFG’s asset quality (Percent) now solidly top quartile 2.66 2.77 – Loan loss provision has 2.26 1.88 outpaced charge-offs for 1.69 1.40 the last eight quarters 1.60 1.40 1.14 • Three relationships comprise 40% of total 2011 2012 2013 non-p
Slide 29: Diverse Balance Sheet
Diverse Balance Sheet Portfolio Balance of $477.3 Million at Year-end 2013 Consumer 10.0% Commercial • Diversification of 17.9% balance sheet an Residential important risk mitigator Real Estate 20.9% • SBFG reliance on Commercial Agriculture Real Estate commercial real estate 8.2% 43.0% below median
Slide 30: Business Strategy Offers Additional Advantages
Business Strategy Offers Additional Advantages Return on Average Assets (Percent) • Dividends reinstated in 2013; continuous payout a 0.97 0.97 0.87 management priority 0.72 0.70 • Management/Board open to 0.57 growth through acquisition 0.81 0.75 • Retained earnings have improved TCE ratio 232 bps
Slide 31: Proposal Questions, Comments, and Discussion
Proposal Questions, Comments, and Discussion 32
Slide 32: Voting Results
MD | financialgr Voting Results 33
Slide 33: Strategy and Team Poised for Performance
Strategy and Team Poised for Performance • Diversify sources of revenue to increase profitability • Strengthen presence in markets served • Expand product service utilization by new and existing clients • Deliver gains in operation excellence • Sustain asset quality 34
Slide 34: Thank You!
THANK YOU! 35
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