Citizens Community Bancorp, Inc. · NASDAQ:CZWI
Citizens Community Bancorp — Hovde 2019 Community Bank Investor Conference
24 slides from Citizens Community Bancorp's conference presentation, Nov 4, 2019
Slide 1: Hovde 2019 Community Bank Investor Conference
Filed Pursuant to Rule 433 Registration Statement No. __________ Issuer Free Writing Prospectus Dated October __, 2015 Relating to Preliminary Prospectus Supplement Dated October __, 2015 Citizens Community Bancorp Inc. Hovde 2019 Community Bank Investor Conference 2019 Third Quarter 1
Slide 2: Cautionary Notes and Additional Disclosures
Cautionary Notes and Additional Disclosures CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS This presentation contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, and Section 21E of the Securities Exchange Act of 1934. These statements inc
Slide 3: Cautionary Notes and Additional Disclosures (Cont'd)
Cautionary Notes and Additional Disclosures (Cont’d) Additional Information and Where to Find It This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval, nor shall there be any sale of securities in any j
Slide 4: CZWI Focus Items
CZWI Focus Items ENHANCING THE QUANTITY AND QUALITY OF EARNINGS We are enhancing shareholder value by improving the loan and deposit mix, deepening customer relationships and strengthening other sources of revenue. EXPERTISE IN COMMERCIAL & AG BANKING We take pride in serving small and mid-sized bus
Slide 5: Key Market Differentiators
Key Market Differentiators • Serving small to mid-sized • Experienced, energetic entrepreneurs leadership team • Responsive professionals • Accountability for doing the • Products to compete vs. big right thing and getting results banks, superior to smaller • Entrepreneurial spirit, winning communit
Slide 6: Execution of Current Business Strategy
Execution of Current Business Strategy Total Loans Loans/Deposits $1,200 $1,124 120% $993 $1,020 $1,020 $1,000 110% 103% 102% $759 99% 99% 99% 100% $800 $733 100% 97% $574 $600 90% $400 80% $200 70% $0 60% 2016 2017 2018 Dec-18 Mar-19 Jun-19 Sep-19 2016 2017 2018 Dec-18 Mar-19 Jun-19 Sep-19 NPA / As
Slide 7: Net Income and Diluted EPS
Net Income and Diluted EPS Net Income Diluted EPS $1.00 $6,000 $4,962 $0.78 $5,000 $4,221 $4,283 $4,107 $0.75 $0.67 $0.68 $0.58 $4,000 $3,563 $3,395 $0.49 $0.46 $3,000 $2,573 $2,575 $0.50 $2,499 $0.37 $2,094 $1,723 $0.30 $2,000 $1,261 $1,234 $0.23 $0.19 $953 $0.25 $0.16 $1,000 $0.12 $0.09 $0.11 $0 $
Slide 8: Return on Average Assets and Return on Average Tangible Common Equity
Return on Average Assets and Return on Average Tangible Common Equity ROAA ROATCE 20.0% 1.40% 1.23% 16.1% 1.20% 15.0% 12.6% 1.00% 0.93% 0.77% 10.1% 0.80% 0.73% 10.0% 7.3% 7.9% 7.4% 0.56% 0.58% 0.57% 0.53% 6.2% 5.6% 0.60% 0.45% 4.8% 0.40% 0.42% 4.4% 4.3% 4.6% 4.6% 0.34% 0.34% 5.0% 3.8% 0.40% 0.29% 0.
Slide 9: Efficiency Ratio and Tangible Book Value
Efficiency Ratio and Tangible Book Value Efficiency Ratio Book Value Per Share 90% 85% 85% $13.13 84% $14.00 $12.62 $12.59 $13.04 $12.48 $12.45 79% 80% $12.27 80% 77% 78% 78% $12.00 $11.22 $11.05 75% $9.78 72% $9.56 $9.60 70% $10.00 $9.06 $9.07 68% 70% 66% $8.00 61% 60% $6.00 $4.00 50% $2.00 40% $0.
Slide 10: Loan Portfolio
Loan Portfolio $1,200,000 . CZWI has transformed its loan portfolio Investor 1-4 CRE through organic growth and acquisitions $1,000,000 Multifamily C&I . Change has occurred from a primarily consumer focused portfolio to a diversified $800,000 Non-Owner Occ. CRE mix consisting of commercial real est
Slide 11: Commercial Loan Detail
Commercial Loan Detail . Commercial loan portfolio well diversified . Total portfolio of $874.9 million at 09/30/2019, which includes impact of F&M acquisition. . Strong growth in all commercial loan categories . Average note size is under $280 thousand ($000) $350 $329.1 $325.4 AG $300 $283.4 $254.
Slide 12: Deposit Composition
Deposit Composition $1,200,000 $1,000,000 . June 2019 Quarter reflects the CDs > 100k sale of $34.1 million of Michigan $800,000 Branch deposits. CDs < 100k MMDA & Sav $600,000 . September 2019 Quarter NOW & Other reflects the purchase of $148.5 Trans. $400,000 Demand million due to F&M acquisition.
Slide 13: Loan Graphs
Loan Graphs Agricultural Loans as % of Total Loan Classified Assets by Loan Type Portfolio Consumer 1% Consumer C&I AG RE 5% 14% 20% Residential RE 18% AG Operating 5% AG 11% Commercial Residential RE 66% 17% CRE 43% Agricultural Loans by Major Product Type Agricultural Loans by Industry Other Opera
Slide 14: Market Demographics
Market Demographics CZWI operates in diverse markets within the northwestern region of Wisconsin, metro Twin Cities and the Mankato, Minnesota MSA Eau Claire: . Features a broad-based, diverse economy, which is driven by commercial, retail and medical industries Mankato: . The Mankato market also
Slide 15: Net Interest Margin Analysis
Net Interest Margin Analysis Quarter ended September 30, 2019 Quarter ended June 30, 2019 Interest Average Interest Average Average Income/ Yield/ Average Income/ Yield/ ($ Dollars in Thousands) Balance Expense Rate Balance Expense Rate Average interest earning assets: Cash and cash equivalents $ 32
Slide 16: Subsequent Event
Subsequent Event •In the fourth quarter, the Company will record a discrete tax credit of approximately $350 thousand and reduce goodwill by approximately $300 thousand, which will increase tangible book value by $0.06 per share. This is due to the Company's evaluation of the new tax guidance which
Slide 17: Recent Franchise Expansion
Recent Franchise Expansion CZWI has been focused on transforming the Company away from a consumer based bank into a commercial focused operation, creating a strengthened franchise value through this process 2016 Acquisition of 2 Central Bank branches in Northwestern WI: $27.1 million deposits 2016
Slide 18: Branch Locations as of July 1, 2019
Branch Locations as of July 1, 2019 CZWI Locations Source: S&P Global Market Intelligence 18
Slide 19: Disciplined Acquisition Strategy
Disciplined Acquisition Strategy Areas of Potential Acquisition Opportunities Duluth Superior Rice Lake Eau Claire Minneapolis Wausau St. Paul Mankato Mason City La Crosse Winona Rochester Source: FIG Partners, S&P Global Market Intelligence 19
Slide 20: Appendix
Citizens Community Bancorp Inc. aA Appendix
Slide 21: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures Reconciliation of GAAP Earnings and Core Earnings (non-GAAP): FY 2016 FY 2017 FY 2018 Dec-18 Mar-19 Jun-19 Sep-19 GAAP pre-tax earnings $ 3,859 $ 3,822 $ 6,609 $ 1,822 $ 1,275 $ 5,607 $ 1,664 Merger related costs (1) 701 1,860 463 1,057 659 206 2,911 Bra
Slide 22: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures (1) Costs incurred are included as professional fees and other non-interest expense in the consolidated statement of operations and include costs of $61,000, $160,000, $119,000 and $461,000 for the quarters ended September 30, 2019, June 30, 2019, March
Slide 23: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures Return on Average Assets (ROAA) as Adjusted (In thousands except ROAA and ROAA as adjusted) 2016 2017 2018 Dec-18 Mar-19 Jun-19 Sep-19 Net Income (annualized for Dec 2018, Mar 2019, June 2019 & Sept 2019) $ 2,573 $ 2,499 $ 4,283 $ 5,044 $ 3,812 $ 16,473
Slide 24: Reconciliation of Non-GAAP Financial Measures
Reconciliation of Non-GAAP Financial Measures Effiency Ratio as Adjusted (In thousands except Efficiency Ratio and Efficiency Ratio as adjusted) 2016 2017 2018 Dec-18 Mar-19 Jun-19 Sep-19 Non-interest Expense (GAAP) $ 20,058 $ 22,878 $ 29,764 $ 9,794 $ 9,894 $ 9,389 $ 12,975 Merger related costs (70
Citizens Community Bancorp — Hovde 2019 Community Bank Investor Conference on 6ix