Slide 1: Offering Disclosure
Offering Disclosure CBTX, Inc. (the “Company”, “CBTX”, or “we”) has filed a registration statement (including a prospectus, which is preliminary and subject to completion) with the U.S. Securities and Exchange Commission (the “SEC”) for the offering to which this communication relates. Before you in
Slide 2: Offering Summary
Offering Issuer: Summary CBTX, Inc. Exchange / Ticker: Nasdaq: CBTX Shares Offered: 2.4 million shares Price Range: $24.00 - $26.00 per share Offering Size: $60 million (at the midpoint of the pricing range) Offering Structure: 100% Primary Overallotment Option: 15% Lock-Up: 180 days General corpora
Slide 3: Company Overview
Company Overview Founded in 2007 Primarily a business bank, ~85% commercial loans as of June 30, 2017 Seasoned executive management team History of organic growth, mergers of equals, and acquisitions Diverse and attractive loan portfolio Low-cost core funding with ~41% noninterest-bearing demand dep
Slide 4: Company Highlights
Company Highlights Bob Franklin, Chairman of the Board, CEO and 36-year banking veteran, leads a 10 person executive committee with an average of 38 years of banking experience 34 strategically located branches give the bank a material presence in the expansive Houston and Beaumont markets Sophistic
Slide 5: Leadership Team
Leadership Team Executive committee consists of 10 highly qualified bankers with an average of 38 years of banking experience Four regional CEOs, with an average of 27 years of banking experience, oversee loan and deposit production and performance goals for their markets Robert “Bob” Franklin, Jr.
Slide 6: Franchise Expansion
Franchise Expansion 2009 2011 2013 2015 (1) On September 14, 2017, the Company sold the real estate associated with the Deweyville, Texas branch. The branch is expected to close on December 18, 2017. 7 County Acquisition (6) Non-Acquired/De Novo (14) Crosby Acquisition (6) VB Texas MOE (6) MC Bancsh
Slide 7: Growth & Transformation
Growth & Transformation Total Assets ROAA (%) 1.08% 0.94% 0.90% 2009 2010 2011 2012 2013 2014 2015 2016 YTD 6/30/17 Beaumont Houston 28.6% 25.8% 41.4% 58.6% 74.2% 71.4% 2009 Note: Figures reflect as of year-end 12/31, with exception of year-to-date data as of 6/30/2017 2013 6/30/17 8 Transformation
Slide 8: Attractive, Low-Cost Core Deposit Base
Attractive, Low-Cost Core Deposit Base Proven ability to generate low-cost core deposits to fund loan growth – 87% loan to deposit ratio(1) Business banking focus combined with relationship approach results in: – – 41% noninterest-bearing demand deposits 93% core deposits(2) with minimal reliance on
Slide 9: Core Focus on Commercial Loans
Core Focus on Commercial Loans Industrial Construction/Equipment Rental - Provide operating lines of credit, fixed asset financing and real estate loans to numerous industrial companies involved in the construction, modification, support and maintenance of petrochemical plants Industrial Constructio
Slide 10: Strong Credit Culture
Strong Credit Culture Chief Credit Officer with 39 years experience - Seasoned Regional Credit Officers located in Houston and Beaumont Centralized underwriting, tiered approval requirements based on aggregate relationship size: - - Officer credit authority, credit executive committee, and directors
Slide 11: Revenue Growth & Efficiency Improvement
Revenue Growth & Efficiency Improvement Stable net interest margin Efficiency efforts: – Lender efficiency project – increased average loan portfolio per lender by 86% since 2012 Branch rationalization effort – successful and ongoing Investments in people, technology, and systems over past two years
Slide 12: Net Income, Diluted EPS and TBVPS
Shareholder ($ in thousands, except per share data) Value Growth $12.86 $12.19 $11.60 $11.41 $10.73 $10.55 $27,208 $22,842 $11,441 2012 2013 2014 2015 2016 YTD 6/30/17 (1) Diluted EPS (1)(2) TBVPS Net Income Note: Figures reflect as of year-end 12/31, with exception of year-to-date data as of 6/30/2
Slide 13: Growth Strategy
Growth Strategy Organic Growth: - - Continue hiring experienced bankers Identified areas of additional expansion within certain lending verticals: Commercial and industrial Medical SBA lending – - Talent recruitment and retention efforts benefit from becoming public Dedicated focus on gathering core
Slide 14: Opportunity & Investment Rationale
Opportunity & Investment Rationale Strength of management team Significant insider ownership Relationship-based business bank with a strong credit culture Strength of operating markets Platform and team with significant scalability Track record of growth and expansion Disciplined approach to M&A all
Slide 15: Our Brand Promise
Our Brand Promise Our Vision Here to Serve. Our Positioning To experienced business owners, CommunityBank of Texas is the financial partner that delivers a better banking experience. Our Personality Resourceful, Trustworthy, Friendly Responsive, Strong 17
Slide 16: Our Vision
ee \ Our Vision Here to Serve. E\\ CommunityBank Our Positioning OF TEXAS To experienced business owners, CommunityBank of Texas is the financial partner that delivers BUSINESS BANKING \ BETTER BANKING a better banking experience. Our Personality Resourceful, Trustworthy, Friendly Responsive, Strong
Slide 17: Recent Developments
Recent Developments $25.5 mm to $25.8 mm Increase in estimated net income and diluted earnings per share is primarily attributable to: Estimated Net Income $19.7 mm An increase in net interest income resulting primarily from an increase in earning assets; A negative loan loss provision of $1.7 milli
Slide 18: Houston Market
Houston Market With approximately 7.0 million residents, the Houston-The Woodlands-Sugar Land MSA is the 5th largest in the USA by total population: - Ranks 1st out of the 25 largest MSAs in the country for estimated total five year population growth through 2023 Houston has the 4th largest economy
Slide 19: Beaumont Market
Beaumont Market The Beaumont-Port Arthur MSA is located approximately 85 miles east of downtown Houston off of the Gulf of Mexico The cities of Beaumont, Port Arthur and Orange form the “Golden Triangle,” a major industrial and petrochemical complex: - Six of the eight new U.S. ethylene projects und
Slide 20: Non-GAAP Reconciliations
Non-GAAP Reconciliations Tangible Book Value Per Share Tota l Sha rehol ders ' Equi ty Adjustments: Goodwi l l Other Inta ngi bl es Tangible Equity Common Sha res Outs ta ndi ng(1 )(2 ) Book Value Per Share(2 ) $ 371,964 $ 347,316 $ 357,637 $ 344,313 $ 329,252 $ 311,139 $ 222,901 80,950 7,298 80,950
Slide 21: Non-GAAP Reconciliations
Non-GAAP Reconciliations IASof nine 30, As of December 31, 2017 Total shareholders’ Equity $ 371964 $ 347316 $ © 357637 $344,813 $ 329252 § 311839 $222,901 Adjustments: Goodwill 20950 40950 80950 80950 53,049 33049 $7867 Other intangibles 7298 8,364 7791 2879 83303 10225, 984 “Tangible Equity 203716