Connectone Bancorp, Inc. · NASDAQ:CNOB
Connectone Bancorp — Investor Presentation (March 2018)
29 slides from Connectone Bancorp's investor presentation, Mar 13, 2018
Slide 1: Investor Presentation March 2018
Investor Presentation March 2018
Slide 2: Forward-looking statements
This presentation contains forward - looking statements . Any statements about our expectations, beliefs, plans, predictions, forecasts, objectives, assumptions or future events or performance are not historical facts and may be forward - looking . These statements are often, but not always, made th
Slide 3: Strategy & Vision
3 Strategy & Vision We position ourselves as “a better place to be” for clients, our communities, employees and shareholders through: • Minimizes client turnover • “Sense of urgency” culture that differentiates us from our competitors High Quality Client Service Model We continue to maintain solid a
Slide 4: Value Proposition / ConnectOne Bancorp, Inc. Overview
Value Proposition One of the largest New Jersey - based banking institutions with increased scale, technology and lending capabilities serving middle market commercial businesses $5.1 Billion in Total Assets $4.2 billion in total loans* $3.8 billion in total deposits ConnectOne Bancorp, Inc. Overvie
Slide 5: Key Dates
| Key Dates FEBRUARY 2015 OCTOBER 2009 $1 Billion ls JUNE 2013 FEBRUARY 2013 OCTOBER 2006 =™"™ Zelle JULY 2017 $4 Billion JANUARY 2016 JULY 2015 JULY 201 = ali ncino. — a DECEMBER 2016 JUNE 2016 JUNE 2015
Slide 6: Highly Attractive Operating Area
Highly Attractive Operating Area Strategically placed offices throughout the NJ/NY metro area 6 Densely populated, lucrative markets The market we operate in accounts for approximately $2 trillion of the $18 trillion United States GDP New Jersey ranks amongst the highest in the nation by both median
Slide 7: Efficient Banking Model
38% Operating Efficiency Ratio 1 ) 8 5% Consument Active $16.9MM Assets Per Employee Efficient Banking Model L everaging Technology Locations serve as “business hubs” supporting clients beyond geographic footprint Strategically placed offices in our affluent footprint allows for fewer locations by c
Slide 8: Technology initiatives: nCino and Zelle
z initiatives new nCino • Provides ConnectOne with one of the most efficient and streamlined deposit & loan operating systems in the industry • Built on the Salesforce Platform • Supports our best - in - class efficiency metrics and enhances our excellent reputation for “sense of urgency” with our c
Slide 9: Growing the Deposit Franchise
Specialized Focus on Independent Schools • ~ 40% of New Jersey Independent Schools are our clients • Opportunities for expansion into New York & Pennsylvania Municipal Deposits • Competitive products and niche focus • Amongst top 20 banks in New Jersey holding municipal deposits (based on deposit
Slide 10: Core Deposit Growth
Core Deposit Growth 10 $- $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 4Q '16 4Q '17 Average Balance Period End Balance $ MM
Slide 11: Diversified Loan Portfolio
Diversified Loan Portfolio As of 12/31/17 - $4.2 Billion* 11 *Reflects total loans prior to adjusting for unearned net origination fees Other CRE 34% Multifamily 34% Business Loans 25% Residential/ Consumer 7% Type Balance Percentage Type Balance Percentage CRE - Retail $324 Warehouse / Industria
Slide 12: Loan Generation
12 Loan Generation CRE C&I Residential Empowering our staff with the best possible tools and resources that enhance our excellent reputation for “sense of urgency” with our clients 01 Experienced CRE Lenders & Support Staff • Focus towards owner - occupied lending 02 Developing C&I Capabilities • Te
Slide 13: C&I
C&I C&I Loan Portfolio* 13 Technology & Infrastructure Improvements focus on keeping best in class service with the pace of work our clients are accustomed to at ConnectOne 25 + Team Members Key hires with focused C&I specialties *Balances do not include taxi medallion loans Niche Markets Added capa
Slide 14: Commitment to Strong Credit Quality
14 Commitment to Strong Credit Quality Maintaining a strong credit culture o Disciplined LTV & DSC standards o Loan origination process supported by specialized teams of credit analysts o High quality direct commercial lending o No reliance on participations or wholesale loan purchases o Stay away f
Slide 15: Asset Quality Profile
Asset Quality Profile 15 All NYC Taxi Medallions. Carrying value of $46.7 million at December 31, 2017, representing an average of approximately $343,000 per medallion. 0.14% 0.30% 0.31% 0.28% 0.38% 1.57% 1.62% 1.36% 1.26% 1.29% 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% 12/31/16 3/31/17 6/30/17 9/
Slide 16: A Compelling Investment Opportunity
16 A Compelling Investment Opportunity CNOB trades at an approximately 10% discount ($3.00 per share) to median peer P/E ratio. Further, given our growth profile, we arguably should be trading above median. • Proven track record in CRE; charge - offs near zero • Expansion of C&I, owner - occupied an
Slide 17: Client Testimonials
“ ,, ConnectOne Bank was our recipe for success! Their responsive and creative management team offered us all the necessary ingredients to expand and serve our community of chefs, restaurants & food lovers. “ ,, Client Testimonials 17 President | James Beard Foundation Susan Ungaro “ ,, The responsi
Slide 18: ConnectOne Bancorp, Inc.
& ConnectOne Bancorp, Inc.
Slide 19: Appendix
& ConnectOne Bancorp, Inc. Appendix
Slide 20: Performance Trends: Adjusted Diluted EPS
20 Performance Trends Adjusted Diluted EPS* *Non - GAAP measure which excludes securities gains and charges related to the Bank’s taxi medallion portfolio . See appendix for a reconciliation of GAAP and non - GAAP measures. $0.40 $0.38 $0.42 $0.46 $0.51 $- $0.10 $0.20 $0.30 $0.40 $0.50 $0.60 Q4 2016
Slide 21: Performance Trends: Tangible Book Value Per Share
21 Performance Trends (cont.) Tangible Book Value Per Share* * Non - GAAP measure, see appendix for a reconciliation of GAAP and non - GAAP measures. $11.96 $12.23 $12.42 $12.78 $13.01 $- $2.50 $5.00 $7.50 $10.00 $12.50 $15.00 12/31/16 3/31/17 6/30/17 9/30/17 12/31/17 Consistently building sharehold
Slide 22: Performance Trends: Adjusted Return on Equity
22 Performance Trends (cont.) Adjusted* Return on Equity *Non - GAAP measure which excludes securities gains and charges related to the Bank’s taxi medallion portfolio. See appendix for a reconciliation of GAAP and non - GAAP measures. 1) Peer group includes banks and thrifts between $1.0B and $7.5B
Slide 23: Capital Strength
23 Capital Strength At December 31, 2017 8.41% 8.92% 9.15% 9.26% 11.04% 9.39% 9.84% 10.21% 10.21% 10.90% 0.00% 2.00% 4.00% 6.00% 8.00% 10.00% 12.00% TCE Ratio Leverage Ratio CET 1 Ratio Tier 1 Ratio Risk-based Capital Ratio Bancorp Bank Well Capitalized
Slide 24: Loan Funding Metrics
Loan Funding Metrics *Excludes impact of $36.5 million taxi medallion charge - off for the quarter ended December 31, 2016 . 24 $374 $342 $495 $415 $494 $244 $262 $318 $249 $276 $130 $80 $177 $166 $218 4.00% 4.21% 4.25% 4.37% 4.50% 2.50% 2.75% 3.00% 3.25% 3.50% 3.75% 4.00% 4.25% 4.50% $- $100 $200 $
Slide 25: Reconciliation of GAAP and non-GAAP measures
Appendix Reconciliation of GAAP and non - GAAP measures 25 Dec. 31, Sept. 30, June 30, Mar. 31, Dec. 31, 2017 2017 2017 2017 2016 Reconciliation of GAAP Earnings to Earnings Excluding the Following Items: Net income (loss) available to common stockholders 10,580$ 13,077$ 7,683$ 11,880$ (2,024)$ Defe
Slide 26: Reconciliation of GAAP and non-GAAP measures (cont.)
26 Appendix Reconciliation of GAAP and non - GAAP measures (cont.) Dec. 31, Sept. 30, June 30, Mar. 31, Dec. 31, 2017 2017 2017 2017 2016 Return on Equity Measures Net income available to common stockholders-adjusted 16,336$ 14,853$ 13,402$ 12,325$ 12,172$ Average common equity 567,308$ 556,620$ 549
Slide 27: Reconciliation of GAAP and non-GAAP measures (cont.)
27 Appendix Reconciliation of GAAP and non - GAAP measures (cont.) Dec. 31, Sept. 30, June 30, Mar. 31, Dec. 31, 2017 2017 2017 2017 2016 Capital Ratios and Book Value per Share Common equity 565,437$ 557,691$ 546,173$ 540,277$ 531,032$ Less: intangible assets (148,273) (148,442) (148,611) (148,804)
Slide 28: Reconciliation of GAAP and non-GAAP measures (cont.)
28 Appendix Reconciliation of GAAP and non - GAAP measures (cont.) Dec. 31, Sept. 30, June 30, Mar. 31, Dec. 31, 2017 2017 2017 2017 2016 Asset Quality Nonaccrual taxi medallion loans 46,765$ 47,430$ 48,884$ 59,054$ 63,044$ Nonaccrual loans (excluding taxi medallion loans) 18,848 13,755 14,055 12,79
Slide 29: Reconciliation of GAAP and non-GAAP measures (cont.)
29 Appendix Reconciliation of GAAP and non - GAAP measures (cont.) (1) Adjusted net income available to common stockholders divided by weighted average diluted shares outstanding. (2) Adjusted net income available to common stockholders divided by average assets. (3) Net income available to common s
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