Sb Financial Group, Inc. · NASDAQ:SBFG
Sb Financial — Shareholder Meeting (April 2022)
40 slides from Sb Financial's shareholder meeting presentation, Apr 20, 2022
Slide 1: 2022 Annual Meeting of Shareholders
2022 A N N U A L M E E T I N G O F S H A R E H O L D E R S 1
Slide 2: Building One of America's Great Community Banks
Building One of America’s Great Com munity Banks 2 • The foundation of our company is our People that share a united Purpose to Serve and a Passion for strong Performance • Delivered record Profitability. • Originated 1,144 Government PPP Loans • Assisted 221 New Clients with Liquidity Needs • Achie
Slide 3: 2021 Business Overview
2021 Business Overview 13
Slide 4: Safe Harbor Statement
Safe Harbor Statement Certain statements within this document, which are not statements of historical fact, constitute forward - looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward - looking statements involve risks and uncertainties and actual resu
Slide 5: 2021 Highlights
• Net income of $18.3 million or $2.56 per share • Assets grew by $73 million or 5.8% • ROAA of 1.38% - - 78 th percentile (14 th place)* • KBW Honor Roll – 2020 • Produced $600 million in residential real estate loans • Produced 1,144 PPP loans for $112 million during 2020 and 2021. 15 * Peer group
Slide 6: Our Vision
Our Vision over the next five years is to operate as a Russell 2000, integrated, diversified financial services conglomerate with high - performing affiliates, as we balance the needs of our shareholders, clients, staff and communities. Russell 2000 Commitment to Stakeholders High Performance Our Vi
Slide 7: Return on Average Assets (ROAA)
1.75 1.50 1.25 1.00 0.75 0.50 0.25 0.00 2017 2018 2021 ROAA SBFG 2019 2020 Peer Group Top Quartile* Peer Ranking 94th 83rd 77th 83rd 78th * Peer group consists of S&P Capital 2021 data for 65 publicly traded bank holding companies in the U.S. on a major exchange with assets between $500 million and
Slide 8: Our Organization & Leadership
Our Organization & Leadership CORPORATE LEADERSHIP • Mark Klein – Chairman, President/CEO • Tony Cosentino – EVP/CFO • Ernesto Gaytan – EVP/Chief Technology Innovation Officer • Keeta Diller – EVP/Chief Risk Officer REGIONAL/COMMERCIAL LEADERSHIP • David Homoelle – Regional President, Columbus • Ste
Slide 9: Net Income Contributions and Assets Under Management
Retail/PCG $0.6M / 3% Peak $0.5M / 3% RRE $6.9M / 37% Commercial/SBA $9.6M / 53% WM $0.7M / 4% NET INCOME CONTRIBUTIONS 2021 NET INCOME $ 18.3 MILLION DECEMBER 2021 ASSETS UNDER MANAGEMENT $3.3 BILLION COMPRISED OF: • $1.3B Commercial Bank • $1.4B Residential Sold Portfolio • $618M Wealth Management
Slide 10: Key Initiatives
Key Initiatives Become a Russell 2000, High - Performing Financial Services Conglomerate Increase profitability through ongoing diversification of revenue streams Strengthen penetration in all markets served Expand product service utilization by new and existing customers Deliver gains in operationa
Slide 11: Key Initiatives
Key Initiatives Become a Russell 2000, High - Performing Financial Services Conglomerate Increase profitability through ongoing diversification of revenue streams Strengthen penetration in all markets served Expand product service utilization by new and existing customers Deliver gains in operationa
Slide 12: Increase Profitability Through Diversification of Revenue Streams
Increase Profitability THROUGH DIVERSIFICATION OF REVENUE STREAMS $20 $18 $16 $14 $12 $10 $8 $6 $4 $2 $0 $75 $70 $65 $60 $55 $50 $45 $40 $35 $30 $25 $20 $15 $10 $5 $0 2017 2018 2019 2020 2021 REVENUE (MIL) TOTAL REVENUE/NET INCOME Peak Title Other SBA Mortgage Service Charges Wealth Management Net I
Slide 13: Non-Interest Income to Revenue vs Peers
* Peer group consists of S&P Capital 2021 data for 65 publicly traded bank holding companies in the U.S. on a major exchange with assets between $500 million and $2.65 billion 50.0% 45.0% 40.0% 35.0% 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% 2017 2018 SBFG 2021 PERCENTAGE NON - INTEREST INCOME/ REVENU
Slide 14: Mortgage Gain on Sale and Volume
$316 $342 $445 MORTGAGE GAIN ON SALE/VOLUME $694 $600 $750 $700 $650 $600 $550 $500 $450 $400 $350 $300 $250 $200 $150 $100 $50 $0 $0 $5 $10 $15 $20 $25 $30 2017 2018 2019 2020 2021 MORTGAGE VOLUME (MIL) MORTGAGE GAIN ON SALE (MIL) NW Ohio Columbus Findlay Indy Total $ Originations Increase Profitab
Slide 15: Paycheck Protection Program
Increase Profitability THROUGH DIVERSIFICATION OF REVENUE STREAMS PAYCHECK PROTECTION PROGRAM $67.0 $23.7 $16.5 $5.1 $0 $20 $10 $70 $60 $50 $40 $30 $90 $80 2020 2021 Millions Existing Customers New Customers ~$5.0 Million in Fees 25
Slide 16: Wealth Management Business Line
$437 $423 $508 $558 $618 $0 $2 $4 $0 $325 $650 2017 2018 2019 2020 2021 Wealth Management Revenue ($M) Wealth Management AUM ($M) AUM Revenue Wealth Management Business Line $3.8 WEALTH MANAGEMENT AUM AND REVENUE GROWTH 9.1% AUM Growth CAGR 12/31/2017 – 12/31/2021 26
Slide 17: Interest Rate Risk
Change in Interest Rates in Basis Points (“bp”) Rate Shock in Rates (1) Percent Change in Net Interest Income Over One Year Horizon December 31, 2021 +300 bp 11% +200 bp 7% +100 bp 3% - 100 bp - 2% Interest Rate Risk (1): Assumes an immediate and parallel shift in the yield curve at all maturities N
Slide 18: Key Initiatives
Key Initiatives Become a Russell 2000, High - Performing Financial Services Conglomerate Increase profitability through ongoing diversification of revenue streams Strengthen penetration in all markets served Expand product service utilization by new and existing customers Deliver gains in operationa
Slide 19: Proven Growth History
$0 $0 Proven Growth History TOTAL LOANS ($M) $1,000 4.2% Loan Growth CAGR 12/31/2017 – 12/31/2021 $826 $772 $697 $500 $873 $823 2017Y 2018Y 2019Y 2020Y 2021Y TOTAL ASSETS ($M) $1,500 11.0% Asset Growth CAGR 12/31/2017 – 12/31/2021 $1,330 $1,258 $987 $1,039 $877 $750 $0 2017Y 2018Y 2019Y 2020Y 2021Y
Slide 20: Strengthen Market Penetration
Toledo $84M Findlay $26M Columbus $117M Williams Co. $153M Defiance $65M Strengthen Market Penetration 30 Total Loan and Deposit Growth Over Last 5 Years: $618M IN ALL MARKETS SERVED LOAN/DEPOSIT GROWTH Lima $61M
Slide 21: Strengthen Market Penetration: Loan Portfolio
Loans (Net) 62% Securities 20% Cash & Due 11% Other 7% Commercial RE 46% HELOC 6% 1 - 4 Family 25% Agriculture 7% C&I 15% Consumer & Other 1% LOAN PORTFOLIO = $823 MILLION Strengthen Market Penetration IN ALL MARKETS SERVED 31 Loan to Deposit December 2021 – 74% Top Quartile Performance TOTAL ASSETS
Slide 22: Strengthen Market Penetration: Deposit Portfolio
Borrowings 4% Deposits 84% Capital 11% Other 1% Time 16% MMDA 23% Savings 23% Interest Bearing 17% Non - Interest 22% DEPOSIT PORTFOLIO = $1.1 BILLION Strengthen Market Penetration IN ALL MARKETS SERVED 32 Transactional deposits = 84% of total deposits MRQ average cost of deposits = 23 bps* *Decembe
Slide 23: Key Initiatives
Key Initiatives Become a Russell 2000, High - Performing Financial Services Conglomerate Increase profitability through ongoing diversification of revenue streams Strengthen penetration in all markets served Expand product service utilization by new and existing customers Deliver gains in operationa
Slide 24: Market Executives
Market Executives BOWLING GREEN & TOLEDO FULTON & WILLIAMS COUNTIES Mark Cassin Tyson Moss Chris Webb LIMA FINDLAY Andy Farley Stefan Hartman FORT WAYNE COLUMBUS David Homoelle 34
Slide 25: Business Line Leadership
Business Line Leadership RETAIL BANKING PRIVATE BANKING Nancy Rankin – VP, Retail Administration Manager MORTGAGE BANKING Kasey Schwartz – VP, Director of Private Banking Mickey Cooper – SVP, Toledo Susan West – VP, Columbus Rachel Copeland – VP, Ft. Wayne Jason May – AVP, Findlay Steve Watson – SVP
Slide 26: Households, Products & Services
97,276 101,493 110,507 111,702 108,272 36,266 37,499 39,061 36,284 36,553 0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 40,000 45,000 120,000 110,000 100,000 90,000 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 0 2017 2018 2019 Products & Services 2020 2021 Households HOUSEHOLDS PRODUC
Slide 27: Electronic Transactions & In-Office Transactions
0 300 600 900 1,200 1,500 0 1,000 2,000 3,000 4,000 5,000 6,000 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 IN - OFFICE TRANSACTIONS PER YEAR (000’s) ELECTRONIC TRANSACTIONS PER YEAR (000’s) ELECTRONIC TRANSACTIONS & IN - OFFICE TRANSACTIONS Electronic Transactions In - Office Transaction
Slide 28: Referrals & New Business
1,805 1,857 1,712 1,636 1,312 1,006 1,021 959 811 $64.9 $92.8 $71.3 $99.5 $79.3 607 $20 $0 $40 $60 $80 $100 $120 0 700 1,400 2,100 2017 2018 2019 2020 2021 NEW BUSINESS (MIL) REFERRALS Gross Closed New Business Expand Product Utilization BY NEW AND EXISTING CUSTOMERS REFERRALS & NEW BUSINESS 38
Slide 29: Key Initiatives
Key Initiatives Become a Russell 2000, High - Performing Financial Services Conglomerate Increase profitability through ongoing diversification of revenue streams Strengthen penetration in all markets served Expand product service utilization by new and existing customers Deliver gains in operationa
Slide 30: Mortgage Servicing Portfolio
$994,915 $1,084,678 $1,199,107 $1,299,697 $1,362,962 7,051 7,586 8,155 8,543 8,614 0 1,700 3,400 5,100 6,800 8,500 10,200 $0 $250,000 $500,000 $750,000 $1,000,000 $1,250,000 $1,500,000 NUMBER OF LOANS $ OF LOANS ($000s) MORTGAGE SERVICING PORTFOLIO 2017 2018 Servicing Portfolio 2019 2020 2021 Number
Slide 31: Capital Ratio Trends
41 *: Ratio information for State Bank & Trust Note: Tangible common equity/tangible assets is a non - GAAP measure, which management believes may be helpful in better understanding the underlying business performance trends related to tangible assets and tangible common equity. This measure should
Slide 32: Earnings Per Share and Tangible Book Value
$7.28 $7.98 $10.39 $9.24 $11.59 $13.27 $15.39 $15.23 $16.30 $17.60 $0.99 $1.07 $1.06 $1.19 $1.38 $1.74 $1.51 $1.51 $1.96 $2.56 $0.00 $0.50 $1.00 $1.50 $2.00 $2.50 $3.00 $0.00 $2.00 $4.00 $6.00 $8.00 $10.00 $12.00 $14.00 $16.00 $18.00 $20.00 Earnings Per Share Tangible Book Value 2012 2013 2014 2015
Slide 33: Loan Production & Loan Growth
Deliver Gains in Operation Excellence $0 $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000 $0 $100,000 $200,000 $300,000 $400,000 $500,000 $600,000 $700,000 $800,000 $900,000 2017 2018 2019 2020 2021 LOAN GROWTH ($000S) LOAN PRODUCTION BY TYPE ($000s) LOAN PRODUCTION & LOAN GROWTH COMM
Slide 34: Key Initiatives
Key Initiatives Become a Russell 2000, High - Performing Financial Services Conglomerate Increase profitability through ongoing diversification of revenue streams Strengthen penetration in all markets served Expand product service utilization by new and existing customers Deliver gains in operationa
Slide 35: Non-Performing Assets to Total Assets vs Peers
* Peer group consists of S&P Capital 2021 data for 65 publicly traded bank holding companies in the U.S. on a major exchange with assets between $500 million and $2.65 billion. 0.44 0.40 0.64 0.58 0.49 1.00 0.76 0.61 0.49 0.41 0.68 0.43 0.39 0.22 0.19 0.00 0.70 1.40 2017 PERCENTAGE NON - PERFORMING
Slide 36: Net Charge-Offs to Average Loans
- 0.03% 0.08% 0.18% 2017 2018 2019 2020 2021 NCOs/ AVERAGE LOANS SBFG Peer Median* Top Quartile* * Peer group consists of S&P Capital 2021 data for 65 publicly traded bank holding companies in the U.S. on a major exchange with assets between $500 million and $2.65 billion. PERCENTAGE Sustain Asset Q
Slide 37: Reserve to Non-Performing Loans
400.0% 350.0% 300.0% 250.0% 200.0% 150.0% 100.0% 50.0% 2017 2019 Median 2020 Top Quartile 2021 RESERVE TO NON - PERFORMING LOANS 2018 SBFG Sustain Asset Quality 47
Slide 38: Loan Loss Reserve
Sustain Asset Quality 1.80% 1.60% 1.40% 1.20% 1.00% 0.80% 0.60% 0.40% 0.20% 0.00% $16.0 $14.0 $12.0 $10.0 $8.0 $6.0 $4.0 $2.0 $0.0 2017 2018 2021 Millions LOAN LOSS RESERVE Dollars 2019 2020 Percentage 48
Slide 39: Key Initiatives
Key Initiatives Become a Russell 2000, High - Performing Financial Services Conglomerate Increase profitability through ongoing diversification of revenue streams Strengthen penetration in all markets served Expand product service utilization by new and existing customers Deliver gains in operationa
Slide 40: financialgroup
Cc financialgroup 51
SB Financial Group — Shareholder Meeting (April 2022) on 6ix