Flagstar Bank, N.a. · NYSE:FLG
Flagstar Bank, N.a — New York Community Bancorp — Merger or Acquisition (February 2016)
42 slides from Flagstar Bank, N.a's merger presentation, Feb 3, 2016
Slide 1: Growing Earnings, Building Capital, and Creating Value: The Astoria Financial Merger
Exhibit 99.1 Growing Earnings, Building Capital, and Creating Value: The Astoria Financial Merger Investor Presentation February 3, 2016
Slide 2: Cautionary Statements
Cautionary Statements Additional Information and Where to Find It This presentation and certain other related communications are being made in respect of the proposed merger transaction involving the Company and Astoria Financial Corporation (“Astoria Financial”). The Company has filed a registratio
Slide 3: Cautionary Statements
Cautionary Statements Forward-Looking Information This presentation and certain other related communications may contain certain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements include, but are not limited to, the expected com
Slide 4: The Astoria merger is expected to grow earnings, build capital, and create value
The Astoria mergerlike – the others we’ve completed is –expected to grow our earnings, build our capital, and create value for our investors. Pro Forma Pro Forma Pro Forma Pro Forma Pro Forma Multi-Family Deposit Market Assets (a) Deposits (a) Market Cap (c) Loan Portfolio (a) Share (b) $65.4 billio
Slide 5: The Astoria merger is expected to significantly increase earnings and strengthen our balance sheet
The Astoria merger is expected to significantly increase our earnings and strengthen our balance sheet. Significantly Increases Significantly Strengthens our Earnings our Balance Sheet ~ 20%proformaearningsaccretion (a) De-risking strategies greatly enhance our balance sheet profile ~ 15.5% return o
Slide 6: Substantial upside potential relative to the purchase price
The Astoria merger features substantial upside potential relative to the purchase price. Attractive Purchase Substantially Higher Price Multiples Financial Returns 1.78x 12.1% 6.0% 20.0% (a) 7.7% 10.1% 1.49x (5.2%) (b) Price / TBVPS Core Deposit Premium EPS Accretion TBVPS Accretion / (Dilution) NYC
Slide 7: The merger is expected to create New York's pre-eminent community bank
The Astoria merger is expected to create New York’s pre- eminent community bank. Westchester Long Island Queens 92% 85% Brooklyn 52% Within 1 Mile Within 3 Miles Within 5 Miles % of Astoria branches near an NYCB branch NYCB Astoria Note: Data from SNL Financial as of 6/30/15. New York Community Banc
Slide 8: Significantly increase our share of deposits in the NY MSA
We expect the Astoria merger to significantly increase our share of deposits in the NY MSA. A Stronger Deposit Franchise Increases our rank among regional banks in the NY MSA from #4 to #2 2015 Rank Top Banks in the Branches Deposits ($mm) NY MSA (a) Boosts our market share in four attractive 1 Capi
Slide 9: Increase our share of deposits in four highly attractive markets
The Astoria merger is expected to significantly increase our share of deposits in four highly attractive markets. Nassau Suffolk 2015 Rank Top Banks BranchesDeposits ($000) 2015 Rank Top Banks BranchesDeposits ($000) 1 JPMorgan Chase & Co. 92 $13,964,179 1 JPMorgan Chase & Co. 95 $9,911,083 2 Capita
Slide 10: Maximal opportunities for revenue enhancement while minimizing risk
Reflecting its in-market nature and our extensive expertise in post-merger integration and restructuring, the Astoria merger presents maximal opportunities for revenue enhancement while minimizing risk. Capitalizes on Summary Pro Forma Complementary Business Models Balance Sheet Increases our share
Slide 11: The merger is expected to enhance our asset and funding mix
The Astoria merger is expected to enhance our asset and funding mix. NYCB Astoria Pro Forma(a) ADC C&I Other 1% 4% 0% CRE 1-4 Family Covered 21% 1-4 Family (Non-covered) Loans (Non-covered) 54% 4% 0% Multi-family Covered 61% Loans 1-4 Family Multi-family 5% C&I (Non-covered) 69% 1% CRE Other Other 1
Slide 12: Multiple opportunities to drive profitable, sustainable, long-term asset growth
We expect the Astoria merger to provide multiple opportunities to drive profitable, sustainable, long-term asset growth. The Pro Forma Company is Primed for Strong Core Asset Growth Results in greater on-balance sheet capacity to support loan production Highly liquid residential mortgage loan portfo
Slide 13: De-risking our balance sheet to strengthen financial performance
De-risking our balance sheet is expected to strengthen our financial performance both before and after the merger. Balance Sheet Repositioning Strategies In 4Q 2015, we prepaid $10.4 billion of primarily puttable wholesale borrowings with an average cost of 3.16% and replaced them with a like amount
Slide 14: Enhancing our capital management strategy
Enhancing our capital management strategy has strengthened our capital measures and is expected to facilitate further growth. Enhancements to Our Increased Capital Capital Management Strategy Generation Completed on 11/4/15, our common stock offering: — Immediately supported our tangible stockholder
Slide 15: Crossing the SIFI threshold organically in 2Q 2016
While we expect the merger to bring us well beyond the current SIFI threshold, we plan to cross it organically in 2Q 2016. Preparing for SIFI Status Following enactment of the Dodd-Frank Act, we began allocating significant resources towards SIFI preparedness. The degree to which we have already lev
Slide 16: Total payout ratio consistent with SIFI peers
As we continue to grow, we would expect our total payout ratio to be more consistent with the total payout ratio for our SIFI peers. 107 % 102 % Dividends Approved in 2015 92 % 93 % 88 % Share Repurchases Approved in 2015 80 % 78 % 78 % 71 % 72 % 69 % 70 % 67 % 67 % 68 % 57 % 78 % 86 % 58 % 55 % 59
Slide 17: Core Components of our Business Model Enhanced by the Astoria Merger
We Expect the Core Components of our Business Model to Be Enhanced by the Astoria Financial Merger
Slide 18: Increasing our share of NYC's multi-family lending niche
The merger is expected to increase our share of NYC’s highly attractive multi-family lending niche. (in millions) Multi-Family NYCB Portfolio Statistics Loan Portfolio at or for the 12 Mos. Ended 12/31/15 (a) $30,013 % of non-covered loans held for $25,989 $23,849 investment = 72.7% $20,714 $17,433
Slide 19: Low level of net charge-offs in downward credit cycles
We have been distinguished by our low level of net charge- offs in downward credit cycles. Net Charge-Offs/ Average Loans S & L Crisis Great Recession Current Credit Cycle 2.83% 2.89% 1.50% 1.63% 1.77% 1.28% 1.17% 1.24% 0.91% 0.54% 0.68% 0.76% 0.53% 0.43% 0.35% 0.13% 0.21% 0.13% 0.00% 0.00% 0.04% 0.
Slide 20: Sale of non-performing loans to maintain superior asset quality
The sale of Astoria’s non-performing and higher-risk loans upon completion of the merger is expected to enable us to maintain our superior record of asset quality. Non-Performing Loans (a)(b)/ Total Loans (a) S & L Crisis Great Recession Current Credit Cycle 4.17% 4.00% 4.05% 3.56% 3.41% 2.91% 2.83%
Slide 21: Maintaining our record of superior efficiency
The Astoria merger also is expected to maintain our record of superior efficiency. Benefits of the Astoria Merger Efficiency Ratio In-market nature of the merger 73.21% 67.12% underscores the potential for significant 66.59% 65.93% 65.41% 65.84% cost savings Estimated cost saves50% = ~ of Astoria’s
Slide 22: Leveraging our mortgage banking platform
The Astoria merger is expected to leverage our mortgage banking platform and its residential mortgage lending expertise. Loans can be originated/purchased in all 50 states and the District of Columbia. Loan production is driven by our proprietary real time, web-accessible mortgage banking technology
Slide 23: Total Return on Investment
Total Return on Investment
Slide 24: Our commitment to building value is reflected in our total returns
Our commitment to building value for our investors is reflected in our total returns over the course of our public life. Total Return on Investment 4,682% 4,265% 4,319% SNL U.S. Bank and Thrift Index 3,843% NYCB (a) 3,069% 2,754% 2,670% 2,059% CAGR since IPO: 26.2% 717% 393% 450% 461% 244% 213% 209%
Slide 25: For More Information
For More Information Visit our website: ir.myNYCB.com E-mail requests to: ir@myNYCB.com Call Investor Relations at: (516) 683-4420 Investor Relations New York Community Bancorp, Inc. Write to: 615 Merrick Avenue Westbury, NY 11590 New York Community Bancorp, Inc. 2/3/16 25
Slide 26: Appendix A: Additional Information about the Proposed Astoria Financial Merger
Appendix A: Additional Information about the Proposed Astoria Financial Merger
Slide 27: Transaction Features
Transaction Features Astoria Financial will merge with and into NYCB and Astoria Bank will merge The Merger with and into NYCB’s primary bank subsidiary, New York Community Bank. Consideration One-for-one fixed exchange ratio plus $0.50 per share cash payment Cost Savings Approximately 50% of Astori
Slide 28: NYCB and Astoria Financial at a Glance
NYCB and Astoria Financial at a Glance NYCB Features Astoria Financial 1859 Established 1888 1993 Year Converted 1993 Westbury, NY Headquarters Lake Success, NY Largest US Thrift Rank by Assets 4th Largest US Thrift NYSE Exchange NYSE 484,943,308 Shares Outstanding at 12/31/15 100,721,358 $7.91 Bill
Slide 29: NYCB and Astoria Financial: Earnings Summary
NYCB and Astoria Financial: Earnings Summary For the 3 months ended 12/31/15 For the 12 months ended 12/31/15 Astoria Astoria NYCB NYCB (in thousands, except share data) Financial Financial Net interest income $324,554 (a) $84,684 $1,181,831 (a) $340,289 Recovery of losses on loans (6,317) (4,323) (
Slide 30: Profitability, Asset Quality, and Capital Measures
NYCB and Astoria Financial: Profitability, Asset Quality, and Capital Measures At or for the 3 months ended 12/31/15 At or for the 12months ended 12/31/15 NYCB (a) Astoria Financial NYCB (a) Astoria Financial(b) ROATE 17.26 % 4.85% 15.01% 5.19% ROATA 1.24 0.49 1.09 0.51 Net Interest Margin (c) 2.95
Slide 31: Appendix B: Historical Information about Our Merger Transactions
Appendix B: Historical Information about Our Merger Transactions
Slide 32: Expertise in executing accretive transactions and managing integrations
The Astoria merger leverages our expertise in executing accretive transactions and managing post-merger integrations. 1. Nov. 2000 2. July 2001 3. Oct. 2003 4. Dec. 2005 5. April 2006 6. April 2007 Haven Bancorp Richmond County Roslyn Bancorp, Long Island Atlantic Bank of PennFed Financial (HAVN) Fi
Slide 33: Enhancing liquidity, reducing funding costs, boosting deposit share
The Astoria merger, like every other, is expected to enhance our liquidity, reduce our funding costs, and boost our deposit market share. Deposits w/ Astoria (in millions) $3,502 CDs w/ w/ Aurora w/ Desert $2,307 $2,504 NOW, MMAs, and Savings Hills AmTrust Demand deposits $2,759 w/ $1,870 $1,933 PFS
Slide 34: Funding growth of our high-yielding loan portfolio
The Astoria merger, like every other, is expected to provide funding for the growth of our high-yielding loan portfolio. After Astoria (in millions) Held-for-Investment Loan Portfolio $8,182 Multi-family After $1,914 CRE Aurora $8,680 After $1,539 All other HFI loans Desert After After Hills $7,860
Slide 35: Appendix C: Reconciliations of GAAP and Non-GAAP Financial Measures
Appendix C: Reconciliations of GAAP and Non-GAAP Financial Measures
Slide 36: Reconciliations of GAAP and Non-GAAP Financial Measures
Reconciliations of GAAP and Non-GAAP Financial Measures Tangible stockholders’ equity and tangible assets are non-GAAP financial measures. The following table presents reconciliations of these non-GAAP measures with the related GAAP measures for NYCB and for Astoria at December 31, 2015. December 31
Slide 37: Reconciliations of NYCB's GAAP and Non-GAAP Efficiency Ratios
Reconciliations of NYCB’s GAAP and Non-GAAP Efficiency Ratios The following table presents reconciliations of NYCB’s GAAP and non-GAAP efficiency ratios for the three and twelve months ended December 31, 2015. For the Three Months Ended For the Twelve Months Ended December 31, 2015 December 31, 2015
Slide 38: Reconciliations of NYCB's GAAP Loss and Non-GAAP Earnings
Reconciliations of NYCB’s GAAP Loss and Non-GAAP Earnings The following table presents reconciliations of NYCB’s GAAP loss and non-GAAP earnings for the three and twelve months ended December 31, 2015. For the Three Months Ended For the Twelve Months Ended (in thousands, except per share data) Decem
Slide 39: Reconciliations of Astoria's GAAP and Non-GAAP Net Income and EPS
Reconciliations of Astoria’s GAAP and Non-GAAP Net Income and Diluted Earnings per Common Share and its GAAP and Non-GAAP Income Tax Expense The following table presents a reconciliation of Astoria's GAAP and non-GAAP net income and diluted earnings per common share for the twelve months ended Decem
Slide 40: Reconciliations of Net Interest Income and Non-Interest Expense
Reconciliations of NYCB’s GAAP and Non-GAAP Net Interest (Loss) Income and GAAP and Non-GAAP Non-Interest Expense The following table presents reconciliations of NYCB’s GAAP net interest (loss) income and non-GAAP net interest income for the three and twelve months ended December 31, 2015. For the T
Slide 41: Reconciliations of GAAP and Non-GAAP Net Interest Margins
Reconciliations of GAAP and Non-GAAP Net Interest Margins The following tables present reconciliations of NYCB’s GAAP and non-GAAP net interest margins for the three and twelve months ended December 31, 2015. For the Three Months Ended December 31, 2015 GAAP Non-GAAP Average Average Average Yield/ A
Slide 42: Reconciliations of GAAP and Non-GAAP Profitability Measures
Reconciliations of GAAP and Non-GAAP Profitability Measures Average tangible common stockholders’ equity and average tangible assets are non-GAAP financial measures. The following table presents reconciliations of these non-GAAP measures with the related GAAP measures for the three and twelve months
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