Servisfirst Bancshares, Inc. · NYSE:SFBS
Servisfirst Bancshares — 2014 U.S. Bank Conference
33 slides from Servisfirst Bancshares's conference presentation, Sep 2, 2014
Slide 1: ServisFirst Bancshares, Inc. 2014 U.S. Bank Conference
OUR NAME IS OUR MISSION. ServisFirst Bancshares, Inc. NASDAQ: SFBS 2014 U.S. BANK CONFERENCE September 3, 2014
Slide 2: Forward Looking Statements
September 2014 Forward Looking Statements This presentation contains forward - looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 . In addition, ServisFirst Bancshares, Inc . may file or furnish documents with the Securities and Exchange Commission which co
Slide 3: Overview of ServisFirst Bancshares, Inc.
Overview of ServisFirst Bancshares, Inc. OUR NAME IS OUR MISSION.
Slide 4: ServisFirst at a Glance
September 2014 ServisFirst at a Glance Overview ▪ Founded in 2005 in Birmingham, AL ▪ Single bank BHC High - Performing Metropolitan Commercial Bank (1) ▪ Total Assets: $3.8 billion ▪ Tangible Equity (2) : $380 million (3 ) High Growth Coupled with Pristine Credit Metrics (5) ▪ Gross Loans CAGR: 24%
Slide 5: Our Business Strategy
September 2014 Our Business Strategy 1. Simple business model • Loans and deposits are primary drivers, not ancillary services 2. Limited branch footprint • T echnology provides efficiency 3. Big bank products and bankers • With the style of service and delivery of a community bank 4. Core deposit f
Slide 6: Milestones
September 2014 Milestones | 6 ▪ Founded in May 2005 with initial capital raise of $35 million ▪ Achieved total asset milestones of $1 billion in 2008, $2 billion in 2011 and $3 billion in 2013, all through organic growth May ’05: Founded in Birmingham, AL June ’07 : Montgomery , AL March ’11: Corres
Slide 7: Our Footprint
September 2014 Our Footprint | 7 OUR NAME IS OUR MISSION. ServisFirst Branches (12) Nashville LPO Houston Dallas New Orleans Mobile Pensacola Huntsville Birmingham Montgomery Atlanta Dothan Tallahassee Jacksonville Nashville Tampa Bay Little Rock Greenville Charleston Chattanooga Jackson Memphis Kno
Slide 8: Our Markets
September 2014 Our Markets | 8 OUR NAME IS OUR MISSION. (1) Represents metropolitan statistical areas (MSAs ) (2) As reported by the FDIC; as of 6/30/2013 (3) Opened in July 2012 as a loan production office; converted to a full service branch in April 2013 (4) Opened as a loan production office Tota
Slide 9: Opportunistic Expansion
September 2014 Opportunistic Expansion ▪ Our version of “M&A” – Organic strategy provides significant growth with no creation of goodwill ▪ Identify great bankers in attractive markets – Focus on people as opposed to places – Target minimum of $300 million in deposits within 5 years – Best bankers i
Slide 10: Our Business Model
September 2014 Our Business Model ▪ “Loan making and deposit taking ” – Traditional commercial banking services – No emphasis on non - traditional business lines ▪ Culture of cost control – “Branch light ”, with $263 million (1) average deposits per banking center – Leverage technology and centraliz
Slide 11: Scalable, Decentralized Structure
September 2014 Scalable, Decentralized Structure ▪ Local decision - making – Emphasize local decision - making to drive customer revenue – Centralized, uniform risk management and support – Conservative local lending authorities, covers most lending decisions ▪ Geographic organizational structure (a
Slide 12: Correspondent Banking
September 2014 Correspondent Banking OUR NAME IS OUR MISSION. | 12 Correspondent bank to approximately 175 community banks 6/30/2013 # of Accts Balance Avg Acct Bal Total Relationships 129 222,514 Fed Funds Purchased 175,475 1.36MM Deposit Accounts 47,039 0.37MM 6/30/2014 # of Accts Balance Avg Acct
Slide 13: Correspondent Banking Footprint July 2014
September 2014 Correspondent Banking Footprint July 2014 | 13 Correspondent Relationships Correspondent Prospects Settlement Services Program [16 ] Agent Bank Card Program [26 ]
Slide 14: Our Management Team
September 2014 Our Management Team Thomas A. Broughton, III President and Chief Executive Officer ▪ Previously President and CEO of First Commercial Bank (acquired by Synovus Financial, 1992); subsequently, regional CEO for Synovus ▪ American Banker’s 2009 Community Banker of the Year ▪ 58 years old
Slide 15: Financial Results
OUR NAME IS OUR MISSION. Financial Results
Slide 16: Success Measures: Balance Sheet Growth
September 2014 $968 $1,207 $1,395 $1,831 $2,363 $2,859 2008 2009 2010 2011 2012 2013 Success Measures: Balance Sheet Growth | 16 OUR NAME IS OUR MISSION. $1,037 $1,432 $1,759 $2,144 $2,512 $3,020 2008 2009 2010 2011 2012 2013 5 - year CAGR = 24.2% 5 - year CAGR = 23.8% Gross Loans ($mm) Total Deposi
Slide 17: Success Measures: Income Growth
September 2014 $1.31 $1.02 $2.84 $3.53 $4.99 $5.69 2008 2009 2010 2011 2012 2013 $7.0 $5.9 $17.4 $23.2 $34.0 $41.2 2008 2009 2010 2011 2012 2013 ▪ Rare combination of balance sheet growth and earnings power ▪ EPS growth includes impact of $55.1 million of common stock issued in five private placemen
Slide 18: Success Measures: Balance Sheet Makeup
September 2014 ▪ Primary focus on building core deposits, highlighted by non - interest bearing accounts and non - reliance on CDs ▪ C&I lending expertise within a well balanced loan portfolio Success Measures: Balance Sheet Makeup | 18 OUR NAME IS OUR MISSION. Deposit Mix (1) 0.40% Cost of Deposits
Slide 19: Loan Growth by MSA
September 2014 L oan Growth by MSA | 19 OUR NAME IS OUR MISSION. 12/31/2013 6/30/2014 YTD Growth by Market % of Growth Birmingham-Hoover, AL MSA 1,438,126$ 1,537,411$ 99,285$ 50.9% Huntsville, AL MSA 419,753$ 434,912$ 15,160$ 7.8% Dothan, AL MSA 361,463$ 377,904$ 16,442$ 8.4% Montgomery, AL MSA 295,
Slide 20: Loan Growth by Type
September 2014 Loan Growth by Type OUR NAME IS OUR MISSION. | 20 Loan Type (dollars in thousands) 12/31/2013 6/30/2014 1,278,649$ 1,362,757$ 84,108$ 43.10% 151,868$ 178,033$ 26,165$ 13.41% Owner-Occupied Commercial 710,372$ 708,294$ (2,078)$ -1.06% 1-4 Family Mortgage 278,621$ 296,220$ 17,599$ 9.02%
Slide 21: Success Measures: Credit Quality
September 2014 ▪ Strong loan growth while maintaining asset quality discipline Success Measures: Credit Quality | 21 OUR NAME IS OUR MISSION. Allowance for Loan Losses / Total Loans Net Charge Offs / Avg. Gross Loans Non - Performing Assets / Total Assets Non - Performing Loans / Gross Loans 1.57% 1
Slide 22: Success Measures: Profitability Metrics
September 2014 ▪ Consistent earnings results and strong momentum Success Measures: Profitability Metrics | 22 OUR NAME IS OUR MISSION. Core Return on Average Assets (1) Core Return on Average Equity (1) Core Return on Average Common Equity (1) Net Interest Margin (1) Core measures exclude non - rout
Slide 23: Success Measures: Efficiency
September 2014 ▪ Our operating structure and business strategy enable efficient, profitable growth Success Measures: Efficiency | 23 OUR NAME IS OUR MISSION. Core Efficiency Ratio (1) and Core Noninterest Expense / Average Assets (1) (1) (1) 59.93% 45.51% 45.54% 41.54% 38.78% 39.24% 2.10% 1.85% 1.79
Slide 24: Well Positioned for Rising Interest Rates
September 2014 Well Positioned for Rising Interest Rates | 24 OUR NAME IS OUR MISSION. Change in Net Interest Income Scenario Based on parallel shift in yield curve and a static balance sheet Variable - rate Loans 53% of loans are variable rate Deposit Mix 23% of deposits are held in non - interest
Slide 25: Appendix
Appendix OUR NAME IS OUR MISSION.
Slide 26: Our Markets: Centers for Continued Growth
September 2014 Our Markets: Centers for Continued Growth Birmingham, AL ▪ Key Industries: Metals manufacturing, finance , insurance and healthcare services and distribution ▪ Key Employers: Protective Life, HealthSouth Corporation, Vulcan Materials Company, AT&T, and The University of Alabama at Bir
Slide 27: Our Markets: Centers for Continued Growth (cont.)
September 2014 Our Markets: Centers for Continued Growth (cont.) Pensacola, FL ▪ Key Industries : T ourism , military, health services, and medical technology industries ▪ Key Employers : Eglin Air Force Base, Hurlburt Field, Pensacola Whiting Field, Pensacola Naval Air Station and Corry Station; Sa
Slide 28: Tax Credit Partnership Investments
September 2014 Tax Credit Partnership Investments The Bank has invested in three types of tax credit partnerships which provide loan opportunities and allow for the recognition of tax credits • New Market Tax Credit – designed to encourage private sector equity investments in low income communities
Slide 29: Key Operating and Performance Metrics
September 2014 Our Financial Performance: Key Operating and Performance Metrics | 29 OUR NAME IS OUR MISSION. Dollars in Millions Except per Share Amounts For the Year Ended December 31, 6 months Ended 2009 2010 2011 2012 2013 2014 Balance Sheet Total Assets $1,573 $1,935 $2,461 $2,906 $3,521 $3.763
Slide 30: Our Financial Performance: Asset Quality
September 2014 Our Financial Performance: Asset Quality | 30 OUR NAME IS OUR MISSION. Dollars in Thousands Year Ended December 31, Six Months Ended 2009 2010 2011 2012 2013 6/30/2014 Nonaccrual Loans: 1-4 Family 265 202 670 453 1,878 1,199 Owner-Occupied Commercial Real Estate 909 635 792 2,786 1,43
Slide 31: Loan Loss Reserve and Charge-Offs
September 2014 Our Financial Performance: Loan Loss Reserve and Charge - Offs | 31 OUR NAME IS OUR MISSION. Analysis of the Allowance for Loan Losses Dollars in Thousands Allowance for Loan Losses: Beginning of Year $ 10,602 $ 14,737 $ 18,077 $ 22,030 $ 26,258 $ 30,663 Charge-Offs: Commercial, Finan
Slide 32: GAAP Reconciliation and Management Explanation of Non-GAAP Financial Measures
September 2014 GAAP Reconciliation and Management Explanation of Non - GAAP Financial Measures | 32 We recorded a non - routine expense of $ 703 , 000 for the first quarter of 2014 resulting from the correction of our accounting for vested stock options previously granted to members of our advisory
Slide 33: Our Financial Performance: GAAP Reconciliation
September 2014 Our Financial Performance: GAAP Reconciliation OUR NAME IS OUR MISSION. | 33 Dollars in Thousands Six Months Ended 6/30/2014 Provisions for income taxes - GAAP 10,705$ Adjustments: Adjustments for tax on non-routine expense 865 Core provision for income taxes 11,570$ Net income availa