Esquire Financial Holdings, Inc. · NASDAQ:ESQ
Esquire Financial — Q1 2021 Earnings Presentation
28 slides from Esquire Financial's earnings presentation, May 7, 2021
Slide 1: 1Q 2021 Investor Presentation
Ensuring our Clients and Our Institution Succeed Boldly Listed as ESQ Esquire Financial Holdings, Inc. (Financial Holding Company for Esquire Bank, N.A.) 1Q 2021 Investor Presentation Exhibit 99.1
Slide 2: Forward Looking Disclosure
Forward Looking Disclosure This presentation contains forward-looking statements within the meaning of the federal securities laws. Forward-looking statements are not historical fact and express management’s current expectations, forecasts of future events or long-term goals and, by their nature, ar
Slide 3: Our Mission
Ensuring that our Company and clients succeed boldly with innovative products and technology, driving client success through relationship banking Our Mission
Slide 4: How Our Clients Succeed Boldly
Expertise in the litigation market for 14+ years Client centric – relationship banking with a single point of contact Unique products and services tailored to client’s needs Strong underwriting and excellent commercial credit metrics How Our Clients Succeed Boldly Expertise in sales, risk,
Slide 5: Financial Highlights
Financial Highlights How Esquire Succeeds Boldly Key Highlights Industry leading returns from our unique national business models Stable payment processing fee income – noninterest income totaled 35% of revenue at March 31, 2021 Branchless low-cost deposits with a cost of funds of 0.10% at Mar
Slide 6: Financial Highlights, cont’d
Financial Highlights, cont’d How Esquire Succeeds Boldly 6 at March 31, 2021 *EPS – Diluted Earnings Per Share
Slide 7: Strong Growth Driven by Unique National Verticals
Strong Growth Driven by Unique National Verticals How Esquire Succeeds Boldly Key Highlights Strong growth in higher yielding loans Stable low-cost deposit model Equity to Assets of 12.95% 7 at March 31, 2021
Slide 8: Strong Revenue Growth
Strong Revenue Growth How Esquire Succeeds Boldly Key Highlights Strong net interest margin Stable payment processing fee income 8 at March 31, 2021
Slide 9: Industry Leading Net Interest Margin
Stable low-cost deposit model Strong commercial deposits franchise DDA and escrow-based NOW accounts represent 48% and 37% of total deposits at March 31, 2021, respectively Higher yielding variable rate commercial loans anchored by our litigation (attorney related) portfolio How Esquire Succ
Slide 10: Loan Portfolio Diversification with Focused Growth
Loan Portfolio Diversification with Focused Growth Focused growth in higher yielding commercial loans with strong credit metrics Selective multi-family loan growth with strong historical performance in the NY metro market How Esquire Succeeds Boldly 10 at March 31, 2021
Slide 11: Loan Portfolio Diversification with Focused Growth
Approximately 51% of the loan portfolio is variable rate of which 85% have interest rate floor protection at March 31, 2021 Asset sensitive – estimated sensitivity of projected annualized net interest income (“NII”) up 100 and 200 basis point rate scenarios increases projected NII by 9.0% and 18
Slide 12: Esquire’s Bold Opportunities
Esquire’s Bold Opportunities New York City properties total $1.3 trillion in Market Value.* A Significant Growth Opportunity Thoughtful in our property and borrower selection process Minimal historical losses Average debt-service coverage (“DSCR”) of 1.46x Average loan-to-value (“LTV”) of 55
Slide 13: Solid Credit Metrics, Asset Quality and ALLL Coverage
Solid Credit Metrics, Asset Quality and ALLL Coverage How Esquire Succeeds Boldly 13 at March 31, 2021 *ALLL – Allowance for loan and lease losses Net Charge-Offs/Average Loans ALLL*/Loans ALLL*/Nonperforming Loans Nonperforming Loans/Loans
Slide 14: Deposit Composition and Growth
*Note: Excludes sweeps totaling $515 million Deposit Composition and Growth DDA and NOW (escrow funds) deposits total 85% of total deposits, representing stable funding sources in various interest rate scenarios Litigation and payment processing deposits represent 60% and 17% of total deposits a
Slide 15: Strong Financial Metrics = Industry Leading Performance
Strong Financial Metrics = Industry Leading Performance Recognized for Succeeding Boldly Raymond James’ #1 Top Performing Community Bank (2020, 2019) Piper Sandler & Co.’s FSG Top Ideas (2021, 2020) Consistent recognition of exemplary performance from the industry 2019 Bank and Thrift SM – All Stars
Slide 16: National Litigation Market
National Litigation Market Law firms need bold financial partners
Slide 17: The Esquire Competitive Advantage: U.S. Litigation Market
The Esquire Competitive Advantage Esquire’s Bold Opportunities U.S. Litigation Market A Significant Growth Opportunity U.S. Tort actions are estimated to consume 1.5-2.0% of U.S. GDP* annually or $429 billion** Esquire does not compete with non-bank finance companies Significant barriers to en
Slide 18: Commercial Litigation (Law Firm) Loans
Commercial Litigation (Law Firm) Loans Full annual underwriting: 3 years financials and tax returns (business and personal) Full case inventory valuation process Collateral assignment of full case inventory Diversity across law firm inventories and collateral Personal guarantees Average
Slide 19: Payment Processing
Payment Processing Succeed Boldly with flexible payment options across several payment platforms
Slide 20: Payment Volume Trends – A Significant Growth Opportunity
The payments industry grew nearly 3% from 2019 to 2020 to an estimated total payment volume of $7.6 trillion Esquire’s Bold Opportunities Payment Volume Trends – A Significant Growth Opportunity Sources: Company Financial Records,, Note: PayPalfigures represent PayPal’s estimated U.S.percent share o
Slide 21: Independent Sales Organization (ISO) Model
Independent Sales Organization (ISO) Model How Esquire Succeeds Boldly What is an ISO? ISO Responsibilities They Do Merchant Vertical and Technology Focus Sales Agent Model Performs Initial Underwriting Boards Merchant to Payment Processing Platform Installation of Merchant Equipment Man
Slide 22: Strong Growth in Stable Noninterest Income
Currently servicing 58,000+ merchants across 50 states Noninterest income, primarily payment processing fees, represents 35% of total revenue at March 31, 2021 How Esquire Succeeds Boldly *Payment processing CAGR is 62% 22 Strong Growth in Stable Noninterest Income at March 31, 2021
Slide 23: Protecting Our Company with Strong Payment Processing Reserves
How Esquire Succeeds Boldly Key Highlights Strong and stable DDA reserves Protection from merchant chargebacks and returns 23 Protecting Our Company with Strong Payment Processing Reserves at March 31, 2021
Slide 24: High Tech, High Touch
High Tech, High Touch Growing boldly with financial technology for the future
Slide 25: Technology Driving Bold Success
Technology Driving Bold Success Client Centric Technology A Key Driver for Future Growth Website Artificial Intelligence* Marketing Sales Underwriting Onboarding Marketing Cloud AI to facilitate precision marketing and exponential customer acquisition across all verticals Website analytics, data enr
Slide 26: Digitally Transforming The Business of Law
26 Digitally Transforming The Business of Law Aligning Law Firm Case Inventory Lifecycle to Customer Retention Client Incident Receive Intake Case Management Settlement/ Verdict Disbursement $ 1-3 Years (+) Products Case Cost Loans Working Capital and Term Loans Qualified Settlement Loans (“QS
Slide 27: Key Takeaways: Why Esquire is Set to Succeed Boldly
Large national markets primed for disruption: $429 billion in the litigation vertical and $7.6 trillion in the payment processing vertical Key Takeaways Why Esquire is Set to Succeed Boldly Tremendous untapped potential: Esquire’s current market share is a fraction of both national verticals We are
Slide 28: Succeeding Boldly – Contact Information
Succeeding Boldly Listed as ESQ Contact Information: Eric S. Bader Executive Vice President & Chief Operating Officer 516-535-2002 eric.bader@esqbank.com
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