Western New England Bancorp, Inc. · NASDAQ:WNEB
Western New England Bancorp — Investor Presentation (September 2017)
21 slides from Western New England Bancorp's investor presentation, Sep 27, 2017
Slide 1: Local banking is better than ever.
Local banking is better than ever. Investor Presentation September 2017
Slide 2: Forward-Looking Statements
Forward - Looking Statements We may, from time to time, make written or oral “forward - looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 , including statements contained in our filings with the Securities and Exchange Commission (the “SEC”), our reports
Slide 3: Overview of Western New England Bancorp
Overview of Western New England Bancorp 3 ▪ Assets : $2.1 billion ▪ Loans: $1.6 billion ▪ Deposits: $1.5 billion ▪ Core Net Income: $7.5 million ▪ Shareholders ’ Equity: $251.2 million ▪ Market Capitalization: $327.8 million ▪ P/TBV: 139.8% ▪ P/LTM Core EPS: 22.9x ▪ Dividend Yield: 1.14% ▪ 21 branch
Slide 4: Experienced Management Team
Years in Banking Years at WNEB Prior Experience James Hagan President & CEO 33 23 Fleet Bank, Bank of New England William Wagner Vice Chairman & Chief Business Development Officer 52 1 Chicopee Savings Bank, Park West Bank, Security National Bank of Springfield Guida R. Sajdak EVP & CFO 28 1 Chicope
Slide 5: Growth-Oriented Strategy
Growth - Oriented Strategy 5 ▪ Executing a growth - oriented strategy that is focused on increasing commercial lending, increasing deposit relationships, and broadening our product lines and services that complements our existing commitment to high - quality customer service. In connection with our
Slide 6: Acquisition of Chicopee Bancorp
Acquisition of Chicopee Bancorp 6 ▪ Completed the Chicopee acquisition on October 21, 2016 ▪ Renamed the holding company Western New England Bancorp, Inc. (“WNEB ”) to reflect the broadened reach and market focus ▪ First in - market merger in Hampden County in over 25 years, creating the largest com
Slide 7: Attractive Market Demographics
Attractive Market Demographics 7 _______ Source: SNL Financial based on deposit market share as of June 30, 2016 Springfield MSA Hampden County Hampshire County Hartford County Population (2017) 634,548 472,757 161,791 895,271 Median HH Income $54,693 $52,159 $62,428 $70,395 # Businesses 23,844 17,2
Slide 8: Largest Community Bank in Hampden County
14.58 14.48 14.10 13.48 11.42 11.29 9.12 5.36 3.88 3.58 2.79 Largest Community Bank in Hampden County 8 ________ Source: SNL Financial as of June 30, 2016 Note: Two Westfield branches are located in Hartford County, CT outside of Springfield MSA 2016 RankInstitution (ST) # of Branches Deposits in Ma
Slide 9: Top 5 Deposit Market Share in Springfield MSA
13.89 12.04 12.01 10.23 8.22 8.14 7.63 7.61 6.28 5.75 3.95 Top 5 Deposit Market Share in Springfield MSA 9 ________ Source: SNL Financial as of June 30, 2016 Note: Two Westfield branches are located in Hartford County, CT outside of Springfield MSA 2016 RankInstitution (ST) 2016 Number of Branches 2
Slide 10: Springfield, MA Economic "Mini-Revival"
_______ Source: westernmassedc.com; masslive.com; reuters.com; SNL Financial Springfield, MA Economic “Mini - Revival” New England’s “Knowledge Corridor” The Greater Springfield - Hartford metropolitan area has been dubbed the “Knowledge Corridor” • Academic Powerhouse : Home to 29 universities and
Slide 11: Increasing Profitability
2015Y 2016Y YTD ' 16 YTD '17 $0.33 $0.41 $0.19 $0.25 Core Earnings per Share Increasing Profitability 11 ________ Core EPS, ROAA and ROAE excludes tax benefits in 2017 and merger costs, net of tax, in 2016 and 2017. First quarter of 2017 was the first full quarter with Chicopee. See Appendix for rec
Slide 12: Improved Operating Efficiency
Improved Operating Efficiency 12 2015Y 2016Y YTD 2017 75.34 72.60 64.88 Efficiency Ratio (%) ________ First quarter of 2017 was the first full quarter with Chicopee
Slide 13: Strengthening Balance Sheet Mix: Loans
Strengthening Balance Sheet Mix 13 $ in thousands 2015Y 2016Y 6/30/2017 $818,213 $1,566,484 $1,608,664 Loans 61.1 75.5 77.6 55 60 65 70 75 80 2015Y 2016Y 6/30/2017 Loans / Assets (%) 90.9 103.2 107.6 85 90 95 100 105 110 2015Y 2016Y 6/30/2017 Loans / Deposits (%)
Slide 14: Strengthening Balance Sheet Mix: Deposits
Strengthening Balance Sheet Mix 14 $ in thousands 2015Y 2016Y 6/30/2017 $900,363 $1,518,071 $1,495,337 Deposits 2015Y 2016Y 6/30/2017 56% 62% 62% 44% 38% 38% Deposit Mix Core Deposits Time Deposits
Slide 15: Loan and Deposit Composition
Loan and Deposit Composition 15 Loan Mix Deposit Mix As of June 30, 2017 Non - Interest Bearing 20% Interest - Bearing DDA 6% MMDA & Savings 36% Time Deposits 38% Residential 34% CRE & Multifamily 44% C&I 15% Home Equity 6% Other Consumer 1%
Slide 16: Net Interest Margin
Net Interest Margin 16 Strengthened balance sheet mix results in improved NIM NIM, exclusive of purchase accounting adjustments, was 2.68% and 2.99% for 2016Y and YTD 2017, respectively 2015Y 2016Y YTD 2017 2.53 2.70 3.09 Net Interest Margin (%)
Slide 17: Strong Regulatory Capital and Growing Valuation
Strong Regulatory Capital and Growing Valuation 17 Regulatory Capital Equity and Market Value TCE / TA Leverage Ratio Tier 1 Ratio Total Risk Based Ratio 10.4 11.2 16.2 17.2 10.7 12.2 14.5 15.1 11.4 11.9 15.1 15.8 12/31/2015 12/31/2016 6/30/2017 2015Y 2016Y 6/30/2017 $139,466 $220,211 $234,464 $153,
Slide 18: Competitive Shareholder Returns
(20.00) (10.00) 0.00 10.00 20.00 30.00 40.00 50.00 60.00 9/20/2014 3/20/2015 9/20/2015 3/20/2016 9/20/2016 3/20/2017 9/20/2017 WNEB-US SNL U.S. Bank and Thrift S&P 500 Competitive Shareholder Returns 18 51.3% 41.4% 32.9% 3 - Year Total Return Total return includes stock price appreciation and divide
Slide 19: Investment Considerations
Investment Considerations 19 ▪ Largest community bank in Hampden County and one of the largest in the Springfield MSA ; taking advantage of dislocation and opportunity with our core customer base ▪ Enhanced branch network provides greater density in attractive markets with significant retail and com
Slide 20: Appendix
Western © New England Bancorp Appendix
Slide 21: Reconciliation of Non-GAAP to GAAP Financial Measures
Reconciliation of Non - GAAP to GAAP Financial Measures 21 ________ Core ROAA and ROAE excludes tax benefits in 2017 and merger costs, net of tax, in 2016 and 2017 $ in thousands Three Months Ended Six Months Ended June 30, March 31, June 30, June 30, 2017 2017 2016 2017 2016 Net Income: Net income,
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