Bank7 Corp. · NASDAQ:BSVN
Bank7 — Q4 2020 Earnings Presentation
24 slides from Bank7's earnings presentation, Jan 29, 2021
Slide 1: BSVN 2020 Earnings Release
BSVN 2020 EARNINGS RELEASE January 29, 2021
Slide 2: BSVN – A Strong Value Proposition
BSVN – A Strong Value Proposition • Positioned in a dynamic market, with a commercial banking emphasis that delivers services via a branch-lite model. • Experienced and talented bankers focused on high-touch personalized service. Company • Strong credit culture that adheres to a robust risk manageme
Slide 3: 2020 Overview
2020 Overview • Strength of our PPE was evident in 2020, as it allowed us to increase our cash dividend, repurchase a significant amount of stock at a deep discount to TBVPS, substantially increase our ALLL reserve, and grow our balance sheet while still ending the year with total RBC of 14.73%. Con
Slide 4: Outstanding Book Value Appreciation
Outstanding Book Value Appreciation Tangible Book Value Per Share $11.69 • Tangible book value per share CAGR of 17.3% over the past three years. $9.78 • We have increased tangible book value per share $8.49 $7.92 by 37.73% over the past two years. $7.24 • When including the cash dividends, BSVN has
Slide 5: Disciplined Share Repurchase Strategy
Disciplined Share Repurchase Strategy 2020 BSVN Share Repurchase Recap Average Number of Shares Purchase Price Book Value Per Discount to Discount to Purchased Per Share Share Book Value $ Book Value % Q1 793,094 $ 8.59 $ 10.54 $ 1.95 18% Q2 38,160 7.90 11.01 3.11 28% Q3 4,000 8.96 11.39 2.43 21% Q4
Slide 6: A Continuation of BSVN Exceptional Performance
A Continuation of BSVN Exceptional Performance Return on Average Assets (1)(2) 5‐year average: 2.17% • Even with the significant increase to our ALLL 2.75% 2.51% reserve and a challenging rate environment, 2.17% Pro we continue to produce strong ROAA and 2.03% 1.78% Forma ROATCE: 2.03% and 19.14% fo
Slide 7: Strong PPE and Organic Growth
Strong PPE and Organic Growth • A history of strong organic growth. Total Assets CAGR Since 2015: 12.5% $1,016.7 • Consistently strong PPE. $866.4 • High PPE is achieved in part because of $703.6 $770.5 our strategy of having fewer, but better $613.8 $563.5 FTE’s, who excel at providing services and
Slide 8: PPE to Average Assets – Much stronger than peers
PPE to Average Assets – Much stronger than peers 4.00% 3.50% 3.80% 3.53% 3.00% 3.36% 3.25% 3.12% 2.50% 2.00% 1.50% 1.42% 1.50% 1.46% 1.48% 1.00% 1.36% 0.50% 0.00% (3) 2016 2017 2018 2019 2020 Peers BSVN Income Statement as a Percentage of Average Assets (3) 2016 2017 2018 2019 2020 Peer Group Peer G
Slide 9: Strong PPE Provides Excellent Shock-Absorption
Strong PPE Provides Excellent Shock-Absorption Earnings-driven cushion far exceeds regulatory capital minimums as illustrated over a two-year period, consistent with DFAST parameters. Regulatory Total Shock Minimum Q4 2020 Excess Capital Excess Capital to Absorption Ability Target Capital to Target
Slide 10: Net Interest Margin Strength
Net Interest Margin Strength • Despite pandemic-induced stress which has temporarily reduced new loan opportunities, our net interest margin continues to show strength. Net Interest Margin 5.87% 5.49% 5.25% 5.35% 5.16% 1.28% 5.01% 4.98% 0.71% 0.57% 0.62% 0.79% 0.53% 0.44% 4.78% 4.78% 4.63% 4.59% 4.5
Slide 11: Asset Quality
Asset Quality Allowance for Loan Losses to Total Loans Nonperforming Assets to Loans and OREO 2.33% 1.98% 1.37% 1.36% 1.31% 1.22% 1.11% 0.45% 0.47% 0.35% (1) 2016 2017 2018 2019 2020 2017 2018 2019 Q3 2020 Q4 2020 Energy Portfolio as a % of Total Loans Net Charge-Offs to Average Loans 18.6% 18.3% 0.
Slide 12: COVID-19 Loan Deferrals
COVID-19 Loan Deferrals COVID-19 Loan Deferrals – 2Q vs. 4Q • Nine loans with outstanding $312.85 balances of $33 million were on active payment deferrals as of YE – a decrease of 89.4% or $280 million $217.54 from 2Q. • 98.7% of the deferred loans are on $120.95 continued deferment or modification,
Slide 13: Hospitality Loan Portfolio Detail as of 4Q 20
Hospitality Loan Portfolio Detail as of 4Q 20 Hotel Portfolio Exposure by Class Number Balance as of Flag Type of Hotels Q4 2020 Economy 15 $32.45 • Blue collar portfolio that is well-protected by the Midscale 23 101.04 “cycle-down” effect of a recession. 32 out of 35 Upper Midscale 8 60.48 operatin
Slide 14: Hospitality Loan Portfolio Detail at Year-End
Hospitality Loan Portfolio Detail at Year-End Outstanding Loan Type Hotels Balance Operating 35 $165.59 Construction 11 $28.38 Portfolio Metrics – 35 Operating Properties(1) Average Loan Size $4.73 Average Loan to Value 63% Average DCR 1.49 Average Remaining Amortization 15.4 Years Outstanding Hotel
Slide 15: Energy Loan Portfolio
Energy Loan Portfolio Energy Portfolio as a % of Total Loans 4.48% 3.25% 2.38% 2.04% Exploration & Mineral / royalty Service Midstream production interest companies Total COVID Number of Modified # of % of Notes Total Loan Modified COVID % of Purpose Code Desc Notes Notes Modified Balances Balances
Slide 16: Energy Portfolio Potential Exposure
Energy Portfolio Potential Exposure Exploration & Production Liquid Guarantor [1], low decline curve type of production with amortizing ability at $30/barrel oil 5% $2.02 37% Hedged production into 2021 or beyond; 3 yr remaining amortization or less, low loan to value 94% 35.45 Minimal risk of loss
Slide 17: Appendix
Appendix 16
Slide 18: Bank7 Corp. Financials
Bank7 Corp. Financials For the Year Ended December 31, 2020 2019 2019 2018 2017 2016 (Dollars in thousands, except per share data) (3) Pro Forma Income Statement Data: Total interest income $ 53,314 $ 51,709 $ 46,800 $ 42,870 $ 33,153 Total interest expense 6,153 9,516 7,168 4,739 3,303 Provision fo
Slide 19: Bank7 Corp. Financials
Bank7 Corp. Financials For the Year Ended December 31, Performance Ratios: 2020 2019 2019 2018 2017 2016 Pro Forma (5) Return on average: Assets (1) 2.03% 1.03% 2.51% 2.75% 2.17% 1.78% Tangible common equity(1) 19.14 8.61 20.92 26.40 23.31 21.73 Shareholders’ equity(1) 18.82 8.42 20.53 25.69 22.47 2
Slide 20: Non-GAAP Reconciliations
Non-GAAP Reconciliations For the Year Ended December 31, 2020 2019 2018 2017 2016 (Dollars in thousands, except per share data) Tangible shareholders' equity Total shareholders equity $ 107,319 $ 100,126 $ 88,466 $ 69,176 $ 55,136 Goodwill and other intangibles (1,583) (1,789) (1,995) (2,201) (2,407
Slide 21: Loan Portfolio Distribution
Loan Portfolio Distribution Gross Loan Portfolio Composition by Purpose Type Agricultural Non- Farmland Agricultural Farmland Consumer $24.99 $25.47 $9.78 3.0% 3.0% PPP Loans 1.2% $44.94 Hospitality construction 5.4% $28.38 3.4% Commercial construction $29.68 3.5% Commercial and industrial 1-4 famil
Slide 22: Deposit Composition
Deposit Composition Commentary Deposit Composition as of December 31, 2020 NOW deposits • 83.6% of our loan customers also had a deposit relationship $232.7 with us as of December 31, 2020. 25.7% Core Deposits(1) Noninterest- bearing demand Money Markets • Total organic core deposit growth YOY was $
Slide 23: 2019 Pro Forma Net Income Reconciliation
2019 Pro Forma Net Income Reconciliation • On September 5, 2019, our largest shareholders, the Haines Family Trusts, contributed approximately 6.5% of their shares (656,925 shares) to the Company. Subsequently, the Company immediately issued those shares to certain executive officers, which was char
Slide 24: Legal Information and Disclaimer
Legal Information and Disclaimer This presentation and oral statements made regarding the subject of this presentation contain forward-looking statements. These forward-looking statements are subject to significant uncertainties because they are based upon: the amount and timing of future changes in