Slide 1: Unity Bancorp, Inc. 3/31/15
w Unity BANCORP INC 3/31/15 NASDAQ: UNTY
Slide 2: Forward-Looking Statements
This presentation may contain forward-looking statements with respect to Unity Bancorp’s financial condition, results of operations and business. Do not unduly rely on forward-looking statements. Forward-looking statements can be identified by the use of words such as “may,” “should,” “will,” “could
Slide 3: Company Snapshot
Founded September 16, 1991 .Headquartered in Clinton, New Jersey .Approximately $1.0 billion in assets and $789 million in deposits .Unity Bank provides financial services to retail, corporate and small business customers through its 15 retail service offices located in Hunterdon, Middlesex, Somerse
Slide 4: Bank Franchise
Bank Franchise Bank Franchise .Hunterdon County, NJ: Clinton, Flemington, Whitehouse .Middlesex County, NJ: Edison, Highland Park, Middlesex, South Plainfield .Somerset County, NJ: North Plainfield, Somerset .Union County, NJ: Linden, Scotch Plains, Union .Warren County, NJ: Phillipsburg, Washington
Slide 5: Attractive Market Area
Attractive Market Area Attractive Market Area .High household income in our market counties relative to the State of New Jersey and the nationwide medians .State of New Jersey ranks 2nd in the nation in median household income, 4th in per capita income, and 2nd in population density .With respect to
Slide 6: Strategic Goals
To grow our business relationships by being a responsive bank, providing excellent service with flexible terms and conditions – 10% loan growth .Expand the Mortgage Division – Target 15% growth rate in purchased transactions .Expansion of SBA Division – Increase 7A Volume to $30 million .Growth in c
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Slide 8: Senior Management Team
Senior Management Team Senior Management Team James A. Hughes, CPA .President and Chief Executive Officer .Joined the company in 2000 .27 years banking experience .Previously employed at Summit Bancorp .Audit manager with KPMG, L.L.P. John J. Kauchak .Chief Operating Officer .Joined the company in 1
Slide 9: Engaged Board of Directors
Engaged Board of Directors Engaged Board of Directors .David Dallas, Chairman of the Board, and Robert Dallas, Board Member, both founding members of the Bank .Average tenure of Board Members is 15 years .Diverse experience including financial industry, medical professionals, university professional
Slide 10: Recent Financial Performance
Recent Financial Performance
Slide 11: Unity's 2014 Highlights
Unity’s 2014 Highlights10 .Record Commercial Loan growth .Significant growth in Residential Mortgage Division .Rollout of construction lending product .Continued improvement in deposit product mix .Capital raise of $6.3 million oversubscribed
Slide 12: Summary Balance Sheet
Summary Balance Sheet11 1Q152014Y2013YAssets1,035$ 1,009$ 921$ Total Loans785 762 679 Deposits789 794 739 Total Equity72 70 57
Slide 13: Loan Mix
Loan MixLoan Mix (dollars in millions) 48% 51%53%53%52%23%23%27%29%30%21%18%13%10%10%8%8%7%8%8%$593$587$679$762$785$0$100$200$300$400$500$600$700$800$9002011Y2012Y2013Y2014Y1Q15Commercial LoansMortgage LoansSBA LoansConsumer Loans
Slide 14: Commercial and SBA Loan Area
Commercial and SBA Loan AreaCommercial and SBA Loan Area (dollars in thousands) 13 $306,705$63,716$40,454$52,081$405,717$25,881$34,429$20,692$0$50,000$100,000$150,000$200,000$250,000$300,000$350,000$400,000$450,000New JerseyNew YorkPennsylvaniaOther20071Q15
Slide 15: Mortgage Loan Originations
Mortgage Loan Originations (dollars in millions)Mortgage Growth 14 $26.8 $23.3 $65.3 $91.1 $20.3 $52.6 $110.3 $88.4 $38.7 $16.8 $79.4 $133.6 $153.7 $129.8 $37.1 $0$20$40$60$80$100$120$140$1602011Y2012Y2013Y2014Y1Q15$MMPurchasesRefinances
Slide 16: Asset Quality Continues to Improve
Asset Quality Continues to ImproveNPLs / Loans 15 2.25%1.76%1.68%1.51%1.49%1.16%1.10%1.08%0.99%0.56%0.47%0.45%3.35%2.84%2.67%2.07%1.96%1.61%0%2%4%6%8%4Q131Q142Q143Q144Q141Q15Nonperforming LoansTDRs
Slide 17: Deposit Trend
5 Year Deposit Trend (dollars in millions) 16 $101$114$136$153$164$384$410$398$429$414$159$125$205$212$211$644$649$739$794$789$100$200$300$400$500$600$700$800$9002011Y2012Y2013Y2014Y1Q15Noninterest-bearing demand depositsInterest-bearing demand depositsTotal time deposits
Slide 18: Summary Income Statement and Profitability
Summary Income Statement and Profitability (dollars in millions) 17 1Q151Q14Net Interest Income$8.0 $7.3 Provision for Loan Losses0.2 0.6 Noninterest Income 1.6 1.5 Noninterest Expense 6.5 6.2 Provision for Income Taxes1.0 0.7 Net Income$1.9 $1.3 Diluted Earnings Per Share$0.23 $0.17 Return on Avera
Slide 19: Net Interest Income & Net Interest Margin
Net Interest Income & Net Interest Margin (dollars in millions).Despite the interest rate environment, we have focused on growing revenue and protecting the net interest margin 18 $29.0MM$27.4MM$27.4MM$30.1MM$7.3MM$8.0MM3.76%3.62%3.53%3.53%3.57%3.64%0.00%2.00%4.00%$0MM$10MM$20MM$30MM$40MM2011Y2012Y2
Slide 20: Strong Levels of Noninterest Income
Strong Levels of Noninterest Income (dollars in millions) Noninterest Income (excludes gains [losses] on securities) 19 $5.4MM$6.8MM$6.2MM$6.3MM$1.4MM$1.6MM15.5%19.5%18.2%17.0%14.7%17.0%0%5%10%15%20%$0MM$2MM$4MM$6MM$8MM2011Y2012Y2013Y2014Y1Q141Q15Noninterest IncomeNoninterest Income / Revenue
Slide 21: Noninterest Income
Noninterest Income (dollars in thousands)1Q151Q14Branch fee income$346$377Service and loan fee income296295Gain on sale of SBA loans held for sale, net36383Gain on sale of mortgage loans344365BOLI income9496Net security gains- 110Other income198200Total Noninterest Income$1,641$1,526
Slide 22: Noninterest Expense Controls
Noninterest Expense Controls (dollars in millions)Noninterest Expense 21 $24.5MM$24.3MM$24.0MM$24.7MM$6.2MM$6.5MM3.00%3.02%2.88%2.69%2.84%2.72%-1.0%0.0%1.0%2.0%3.0%4.0%$0MM$5MM$10MM$15MM$20MM$25MM$30MM$35MM2011Y2012Y2013Y2014Y1Q141Q15Noninterest ExpenseNoninterest Expense / Average AssetsNote: 1Q14
Slide 23: Noninterest Expense
Noninterest Expense (dollars in thousands)1Q151Q14Compensation and benefits$3,472$3,217Occupancy672659Processing and communications596582Furniture and equipment373357Professional services236211Loan costs221170OREO expenses35247Deposit insurance183178Advertising182151Other expenses532486Total Noninte
Slide 24: Profitability Progression (Quarterly EPS)
Profitability ProgressionDiluted Earnings per Share 23 $0.17 $0.20 $0.24 $0.20 $0.23 $0.00$0.10$0.201Q142Q143Q144Q141Q15
Slide 25: Profitability Progression (Annual EPS)
Profitability ProgressionDiluted Earnings per Share 24 $0.10 $0.13 $0.34 $0.53 $0.81 $0.00$0.20$0.40$0.60$0.802010Y2011Y2012Y2013Y2014Y
Slide 26: Tangible Book Value Per Share
Tangible Book Value Per Share25 Note: 2013 reflects redemption of TARP preferred stock and the associated warrant. $7.04$7.42$7.35$8.18$8.37$6.50$7.00$7.50$8.00$8.502011Y2012Y2013Y2014Y1Q15
Slide 27: Market Price
Market Price$6.40$6.24$7.66$9.43$9.08$3.50$5.00$6.50$8.00$9.502011Y2012Y2013Y2014Y1Q15
Slide 28: Capital Ratios
Capital RatiosUnity Bancorp, Inc. FDIC-Insured Commercial Banks * 2013 Capital Ratios reflect the redemption of the TARP preferred stock and the associated warrants. 0.00%4.00%8.00%12.00%2011Y2012Y2013Y2014YLeverage Ratio0.00%4.00%8.00%12.00%16.00%2011Y2012Y2013Y2014YTotal Risk-Based Capital Ratio0.
Slide 29: Compelling Investment Highlights
Knowledgeable and experienced management team Attractive branch franchise . Improving bank fundamentals Positioned for economic rebound Insider ownership . Compelling Investment HighlightsConsolidation of NJ Community Banks
Slide 30: Data sources
The previous slides contained data from the following sources: . FDIC-Insured Commercial Banks: . Obtained from FDIC.gov Quarterly Banking Profile . SNL