Kearny Financial · NASDAQ:KRNY
Kearny Financial — Q1 2021 Earnings Presentation
20 slides from Kearny Financial's earnings presentation, Nov 10, 2020
Slide 1: Investor Presentation First Quarter Fiscal 2021
Investor Presentation First Quarter Fiscal 2021 Kearny financial corp. Exhibit 99.1
Slide 2: Presenters
Eric B. Heyer Senior Executive Vice President and Chief Operating Officer Keith Suchodolski Executive Vice President and Chief Financial Officer Craig L. Montanaro Director, President and Chief Executive Officer Presenters Kearny financial corp.
Slide 3: Forward Looking Statements
This presentation may include certain “forward-looking statements,” which are made in good faith by Kearny Financial Corp. (the “Company”) pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to risks and uncer
Slide 4: Non-GAAP financial information
This presentation contains financial information determined by methods other than in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Management uses these “non-GAAP” measures in its analysis of the Company’s performance. Management believes these no
Slide 5: Company Overview
NASDAQ: KRNY Market Cap: $751.9 million1 Founded in 1884 Top 10 New Jersey-based financial institution by assets 51 full-service branches2 in 12 counties throughout northern and central New Jersey and New York City Active acquirer, having completed 7 whole-bank acquisitions since 1999 1 As of Octobe
Slide 6: First Quarter Highlights
First Quarter Highlights $7.3 billion in total assets $5.0 billion in total loans $5.0 billion in total deposits $1.1 billion in total equity GAAP net income $11.4 million, core net income $15.0 million1 GAAP EPS $0.13, core EPS $0.171 GAAP ROAA 0.63%, core ROAA 0.83%1 Net interest margin expanded 4
Slide 7: MSB Financial Acquisition
MSB Financial Acquisition Transaction completed on July 10, 2020 Systems conversion and re-branding completed simultaneous with closing Expanded franchise into attractive Somerset and Morris county, NJ markets Tangible book value dilution of 1.4%, or 1.8% inclusive of Day 1 CECL entry Non-interest e
Slide 8: Capital Strength
Capital Strength Tier 1 Leverage Ratio Total Risk-Based Capital Ratio Peer group includes BDGE, BRKL, BMTC, CLBK, CNOB, DCOM, FLIC, FFIC, LBAI, EBSB, NFBK, PGC, STBA, TMP, TRST Source: S&P Global Market Intelligence & Company Filings Robust capital levels support growth and capital management activi
Slide 9: Capital Management
Capital Management Capital Returned to Shareholders Since FY2016, over $600 million of capital returned to shareholders via dividends and share repurchases Repurchases suspended March 2020; resumption of repurchases and additional 5% plan announced October 2020 Source: Company Filings $200,000 $150,
Slide 10: Earnings Performance
Earnings Performance Net Income & Return on Assets1 Earnings per Share1 1) Although management believes core net income, EPS and ROAA, which are non-GAAP measures, are useful to investors by providing a greater level of understanding of its business, they should not be considered a substitute for fi
Slide 11: Deposits
Deposits Consolidated 11 branches in 18 months while shifting the deposit base towards lower cost core deposit relationships Deposit Composition1 Deposit Growth 1 As of September 30, 2020 Source: S&P Global Market Intelligence & Company Filings Cost of Deposits 0.90% 39.00% 20.34% 30.98% 9.68% $5,00
Slide 12: Mortgage Banking
Mortgage Banking 1-4 Family Avg. LTV = 59.0% Home Equity Avg. LTV = 41.0% Residential 1-4 Family Loans Sold Source: Company Filings $600,000 $500,000 $400,000 $300,000 $200,000 $100,000 $0 2017FY $713 $84,430 2018FY $742 $78,766 2019FY $524 $54,288 2020FY $3,159 $282,277 2021Q1 $1,890 $122,215 $7,55
Slide 13: Portfolio Lending
Portfolio Lending Portfolio Composition1 Geographic Distribution1 1 As of September 30, 2020 Source: S&P Global Market Intelligence & Company Filings Loan-to-Value by Real Estate Secured Segment1 Strategy designed to grow and diversify the loan portfolio; focused on C&I and construction credits with
Slide 14: COVID Loan Deferments
COVID Loan Deferments Source: Company Filings September 30,2020 Active Modifications # of Loans Balance Total Modifications # of Loans Balance Increase/(Decrease) # of Loans Balance Commercial loans: Multi-family mortgage 7 $15,910 143 $393,156 (136) $ (377,246) Non residential mortgage 11 41,660 16
Slide 15: COVID Impacted Loan Segments
COVID Impacted Loan Segments Source: Company Filings September 30,2020 Real-Estate Secured # of Loans Balance LTV Non- Real-Estate Secured # of Loans Balance Total # of Loans Balance (Dollars In Thousands) Hotel 4 $ 4,357 51% 7 $ 1,479 11 $ 5,836 Restaurant 15 9,805 51% 36 3,888 51 13,693 Retail sho
Slide 16: Asset Quality Trends
Asset Quality Trends Net Charge-Offs / Average Loans Non-Performing Assets / Total Assets Source: S&P Global Market Intelligence & Company Filings History of strong asset quality with minimal net charge-off activity 0.05% 0.04% 0.03% 0.01% 0.00% 2017FY 0.01% 2018FY 0.03% 2019FY 0.02% 2020FY 0.00% 20
Slide 17: M&A History and Strategy
M&A History and Strategy Experienced acquirer and integrator, having successfully completed 7 whole-bank acquisitions over the past 20 years Opportunistic acquisition strategy with an emphasis on: Low premium deals Similar or complementary business models Expansion in existing or contiguous markets
Slide 18: Executive Management Team
Name Title Years in Banking Years at KRNY Craig L. Montanaro President & Chief Executive Officer 32 17 Eric B. Heyer Senior Executive Vice President & Chief Operating Officer 35 11 Keith Suchodolski Executive Vice President and Chief Financial Officer 19 7 Patrick M. Joyce Executive Vice President a
Slide 19: Non-GAAP Reconciliation Appendix A
Non-GAAP Reconciliation Appendix A Reconciliation of GAAP to Non-GAAP (Dollars in Thousands, Except Per Share Data) For the quarter ended September 30, 2020 Core net income Net Income (GAAP) $ 11,379 Non-recurring transactions – net of tax: Bargain purchase gain (3,053) Provision for credit losses o
Slide 20: First Quarter Fiscal 2021
Investor Presentation First Quarter Fiscal 2021 Kearny financial corp.