Equity Bancshares, Inc. · NYSE:EQBK
Equity Bancshares — Q4 2020 Earnings Presentation
34 slides from Equity Bancshares's earnings presentation, Jan 25, 2021
Slide 1: Fourth Quarter 2020 Results Presentation
Fourth Quarter 2020 Results Presentation January 25, 2021 Exhibit 99.2
Slide 2: Disclaimers
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 Team < Experienced and Invested Management Conservative Credit Culture and Effective Risk Management and Mitigation Robust Funding Capacity, Anchored by a Diverse, Low-Cost Deposit Base Focus on Efficient Performance Throughout
Slide 4: Franchise Overview
(2) Franchise Overview | Western ks Kansas city = | ee sa Western MO «Wichita = KANSAS = Ozark Mountain smc. Cordell Ee OKLAHOMA 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 Previously served as Director of Sales and Marketing for Koch Industri
Slide 6: Diverse Market Segments
Diverse Market Segments 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 r
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 500 banks with deposits less than $750MM in our operating market.
Slide 10: Diversified Loan Portfolio
Diversified Loan Portfolio(1, 2) 9 Year-to-Date Loan Yield 4.98% 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 loan
Slide 11: Credit Quality & Capital Ratios
Credit Quality & Capital Ratios 10 Non-GAAP financial measure. See the non-GAAP reconciliation at the end of this presentation. (1)
Slide 12: Asset Quality – Quarter-over-Quarter
Asset Quality – Quarter-over-Quarter 11 Nonperforming Assets NPAs / Assets 1.19% Net Charge-Offs (NCO)/ Average Loans $0.34 NCO in $ ($ in millions) Nonaccrual Detail $6.70 1.22% 1.54% $0.81 1.37% $0.26 Adjusted to exclude impact of credit specifically identified in March 31, 2019 Form 10-Q. Charge-
Slide 13: Bank Liquidity & Dividend Capacity
Bank Liquidity & Dividend Capacity 12 Dividend Capacity from the Bank
Slide 14: Tangible Book Value
Tangible Book Value 13 Tangible Book Value per Share(1) and Tangible Common Equity (1) TBV CAGR 2016 - 2020: 10.36% Non-GAAP financial measure. See the non-GAAP reconciliation at the end of this presentation.
Slide 15: Strong Core Deposit Franchise
Fully integrated digital banking platform with an adoption rate of 51.2% among core banking customers Online bill payment and mobile deposit activity is up 6.11% year over year 14 Strong Core Deposit Franchise For the year ended December 31, 2020. Includes interest and non-interest bearing deposits.
Slide 16: Strong Core Deposit Franchise
15 Strong Core Deposit Franchise * Includes the impact of non-interest bearing deposits
Slide 17: Robust Growth
Robust Growth 16 Gross Loans ($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 18: Interest Income & Net Interest Margin
Interest Income & Net Interest Margin 17 ($) Thousands (1) (1) (1) Excludes the impact of PPP loans. Including these balances the second, third, and fourth quarter 2020 results would be 3.49%, 3.47%, and 3.88%, respectively, while YTD 2020 results would be 3.63% Annual Results
Slide 19: Interest Income & Net Interest Margin
Interest Income & Net Interest Margin 18 Government Programs PPP fee income increased due to significant forgiveness received by borrowers during the quarter. MSLP – the Bank originated $282M in MSLP loans during the quarter, with 95% being sold to the Boston Fed. Fee income for origination and serv
Slide 20: Income Performance Metrics
Income Performance Metrics 19 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 21: 2020 Fourth Quarter Highlights
20 2020 Fourth Quarter Highlights Non-GAAP financial measure. See the non-GAAP reconciliation at the end of this presentation. Diluted EPS $0.84 Revenue $48.5M ROAE 12.13% $35.6M +11% Net Interest Income $314M +10% Total Deposits $2.4M +14% Debit Card Fee Income year over year $24.68 +4% Tangible Bo
Slide 22: Fourth Quarter Highlights - Continued
Fourth Quarter Highlights - Continued 21 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 23: Outlook on Key Business Drivers
22 Outlook on Key Business Drivers Average Deposits $2,960M $3,000-3,200M 3-8% growth Key Driver Q4’20 Results Q1’21 Outlook Average Loans(1) $2,382M $2,350-$2,450M 3-8% growth Net Interest Margin(1) 3.70% 3.35-3.45% Contraction Non Interest Income(2) $6.4M $6.2-6.8M 10-20% growth Non-Interest Expen
Slide 24: Focus Variables for Outlook & Forecast
23 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 25: Adjusted Operating Performance Trends – Quarter-over-Quarter
24 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 26: Government Facilitated Lending Programs
25 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. During the 4th q
Slide 27: Appendix
Appendix 26
Slide 28: Selected Income Statement Data
Selected Income Statement Data 27
Slide 29: Selected Balance Sheet Data
Selected Balance Sheet Data 28 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 30: Capitalization
Capitalization 29 (1) Non-GAAP financial measure. See the non-GAAP reconciliation at the end of this presentation. Maintaining a strong regulatory capital position
Slide 31: 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 30
Slide 32: TCE to TA and Tangible Book Value per Share
TCE to TA and Tangible Book Value per Share 31
Slide 33: ROATCE and Efficiency Ratio
ROATCE and Efficiency Ratio 32
Slide 34: Equity Bancshares, Inc.
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