Mvb Financial Corp. · NASDAQ:MVBF
Mvb Financial — Keefe, Bruyette & Woods 20th Annual Community Bank Investor Conference 2019
28 slides from Mvb Financial's conference presentation, Jul 29, 2019
Slide 1: Investor Presentation
YOY 83 FINANCIAL Investor Presentation Keefe, Bruyette & Woods 20th Annual Community Bank Investor Conference July 2019
Slide 2: Forward Looking Statements & Non-GAAP Financial Measures
Forward Looking Statements & Non-GAAP Financial Measures This Presentation contains forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21£ of the Securities Exchange Act of 1934, as amended. These forward-looking statements are based
Slide 3: Our Why Statement
Our Why Statement e /'pur-pose/ noun — the reason for which | | l O S — something is done or created or for ® which something exists "Trusted Partners on the Financial 7 Frontier - Committed to Your Success!
Slide 4: MVB Values
MVB Values Trust Commitment Teamwork
Slide 5: Disruption Creates Opportunities
are} Disruption Creates Opportunities o Uber vs. Yellow Top Cabs o Netflix vs. Movie Theaters o Fintech vs. Banking MVB's “Blue Ocean” Strategy Embraces Disruption “The Fintech tsunami is brewing and banks are becoming yellow top taxis in an Uber world - we must modernize or become irrelevant!” -Lar
Slide 6: MVB Today
MVB Today MVB is an innovative financial holding company that provides banking services to individuals and corporate clients in the Payment and Fintech Deposit clients throughou Company Statistics Wh o NASDAQ: MVBF ° © Market Cap: $198.7M ©) ° © Total Assets: $1.88 © ° © Book Value Per Share: $16.46
Slide 7: MVB Portfolio
MVB Portfolio Complementary Business Lines — Regional Lending with National Deposits & wy = Client presence Commercial & Mortgage Fintech Payment & Retail Deposit Services @ 12 banking centers in WV and 3 in NoVa © Commercial: Loans, Deposits and Non-interest Income; 74% of loan portfolio Non-intere
Slide 8: Fintech Strategy Execution
Fintech Strategy Execution eep Up Get Ahead < Increase Lower Risk, Positive Higher Risk, Common in Most Banks Exposure to Less Commonin Banks Fintech trend drivers ant.
Slide 9: Fintech Investment Portfolio Performance
Fintech Investment Portfolio Performance $20,000 $18,000 $16,000 $14,000 $12,000 $ 10,000 $8,000 $6,000 $4,000 $2,000 $- (in thousands) 2016 2017 2018 Mmm Cash Investment —=Fair Value Investments Focused on Strategic Partnerships 206% IRR Q2 2019
Slide 10: MVB Fintech Thesis
MVB Fintech Thesis 1. Identify a niche 1. Access to payment rails 2. Build a solution to meet the needs 2. FDIC insured deposits of users in niche 3. All Fintech companies need a 3. Generate revenue with a highly banking relationship profitable business model 4. Scale quickly Technology company buil
Slide 11: Fintech Differentiators “Distinct, Not Extinct”
Fintech Differentiators “Distinct, Not Extinct” 2019 Growth Coming from Mix of NIB & Reasonably Priced IB Deposits Current Portfolio Mix Hospitality & Gaming 46% ©0000 ° Specialty Escrow 36% Payments Processing 11% Cryptocurrency 7% How We Grow Insiders to Fintech industry clients and technology par
Slide 12: NIM Expansion — Outpacing Peers
NIM Expansion — Outpacing Peers Active Focus on NIM & Upward Trend 4.20% 4.09% 4.00% ~S 3.80% 7~— wee errr re 3.60% 108 bps ~ 3.40% 3.20% 3.00% 2014 2015 2016 2017 2018 —MVvBF = =Regional Peers Source: SEC flings and SNL Financial. Regional peers defined as pubic institutions headquartered in West V
Slide 13: Deposit Growth with NIB Focus
Deposit Growth with NIB Focus NIB CAGR of 36% in under Five Years <> $1,600,000 20% 7,414,979 $1,400,000 18% 3 | | 15% 2 62 5 $1,200,000 $1,092,507 $1,121,580 g £ $1,000,000 $921,924 || |__| 13% 8 4 = ‘a 771,004 L | 11% & 2 $800,000 $771) & 8 8.15% 9% & © $600,000 nrs7rotal Deposits 7% 8 a 2 3 s a @
Slide 14: Organic Growth
Organic Growth Growth with Profitability Emphasis $ in Millions $2,000 : $1751 $1,833 fin $1,384 $1419 $1534 : = —= i gog7 $1110 41,000 i goag ail al P Noninterest-bearing Deposits 65.0% $500 ie | $- Service Fees 39.1% 2010 2011 2012 2013 2014 2015 2016 2017 2018 2 aiiy ee Net Interest Income 18.2%
Slide 15: Financial Highlights
Financial Highlights $ in thousands, except per share 2 2019 Q22018 FY 2018 FY 2017 Q2 2019 Result: Balance Sheet Total Assets $1,833,018 $1,685,419 $1,750,969 $1,534,302 o Net income increased 443.2% year-over-year Gross Loans HFI $1,326,682 $1,215,072 $1,304,366 $1,105,941 . . . Total Deposits $1,
Slide 16: Capital Structure
Retained earnings, AOCL & Treasury stock 15% Common stock 58% Convertible Subordinated debt 16% Trust preferred stock 2% Convertible Preferred stock 9% Common stock 60% Retained earnings Preferred stock 4% AOC, & Treasury stock 28% Subordinated debt 6% ‘Trust preferred stock 2% Common stock 64% Reta
Slide 17: Diversified Loan Portfolio
Diversified Loa Growth & Active Management of Concentration Limits $400 $1,400 450% sized 400% 350% $1,000 \ | | v 300% wn $800 96 of 250% 6 E $600 200% s ~ 150% 100% | 50% $ 0% 2010 2011 2012 2013 2014 2015 2016 2017 2018 Q2 2019 =CRE Loans as a % of Total Risk-Based Capital Source: Compary documen
Slide 18: Commercial Real Estate Portfolio
Apartments - Market Apartments - 14% Low Income 2% Retail 18% Nursing Homes 28% Storage Units Other 1% 2% Office 24% Hotels 11% Source: Compary documents Commercial Real Estate Portfolio 1-4 Family Apartments & Residential Multifamily Owner % Occupied 48% Commercial Development 15% Office 8% Persona
Slide 19: Consistent, Top Tier Asset Quality
Consistent, Top Tier Asset Quality Non-Performing Loans / Total Loans NCOs / Average Loans 3.40% 9 26% 2.92% 0.65% 5 ang, 160% 2.50% 2.33% 2.243 2.35% 0.55% 2.40% 0.459% 1.90% 0.35% 1.40% 0.95% — 9.95% 0.259% 0.35% 0.90% 0.159% . . 0.88% 0.14 0.05% 0.17% 0.17% 0.19% 0.40% 0.77% M 0.12% 0) oon 0.59%
Slide 20: Smaller branch footprint
e SI o Smaller branch footprint o Strategic opportunities for banking centers o Enhanced consumer lending, deposits and fee income o 5 FTE Call Center manages 17 ITMs at 7 banking centers it OS & Average Total Deposits per Branch = $99.0 Million
Slide 21: High Quality & Consistently Profitable
High Quality & Consistently Profitable $2,000 g1so0 $1339 SLA3 $1541 $1,447 $1,000 $736 $743 “ fs $- 2015 2016 2017 2018 YTD 2018 YTD 2019 $300 $250 sor 8287 sous s200 $150 $100 A 2 8B ew a aes a aa ge aa a 2016 2016 2016 2016 2017 2017 2017 2017 2018 2018 2018 2018 2019 2019 Source: Compary documen
Slide 22: Strategic & Opportunistic Talent Acquisition
Strategic & Opportunistic Talent Acquisition An Independent Bank Mindset that Embraces a, “Yes, if” Culture Acquisitions Recent NoVa M&A Disruption 2017/2018 12 Team Members Wells Fargo Insurance 2013 23 Team Members Sold in 2016 Lift Outs BB&T 2005 12 Team Members HNB | Salt Lake City 2009-2011 VA.
Slide 23: Full Coverage Risk Management
Full Coverage Risk Management Investment in & Strong Attention to ERM MVB’'s Enterprise-wide Risk Management process is de- centralized, integrated and supported by a leadership driven risk culture. MVB partnered with PRMIA*, a “world wide" industry risk leader to develop a proprietary statistical a
Slide 24: Addressing Risk Management
Addressing Risk Management Cost of Investing in the Future & Scalability Risk Mitigation Mortgage Volatility CRE Concentration ‘Compliance/Regulatory Risk Payment & Fintech Deposit Client Retention Deposit Concentration & Seasonality Operating Efficiency Diversified geographic portfolio Overhead man
Slide 25: Analysts Positive on MVB Story
Analysts Positive on MVB Story April 8, 2019 - The specialty deposit play is the unique aspect of the story. The entrepreneurial bent of the management team — particularly the CEO — is among the more intriguing aspects of the MVBF story... The company has pursued a progressive approach to Fintech, g
Slide 26: Exhibit 99.1
Exhibit 99.1
Slide 27: Appendix: Non-GAAP Reconciliation
Appendix: Non-GAAP Reconciliation NONINTEREST INCOME / OPERATING REVENUE TANGIBLE BOOK VALUE PER SHARE Fortheyearended, _For the quarter ended, For the quarter end. (Dollars in Thousands) 12/31/2017 12/31/2018 06/30/2018 06/30/2019 Ml (Dollars in Thousands) 06/30/2019 Total Noninterest Income $ 40,7
Slide 28: MVB Financial Corp. contact
Fairmont, WV 26554 (304) 363-4800 MVB Financial Corp. (304) 367-8697 28
MVB Financial — Keefe, Bruyette & Woods 20th Annual Community Bank Investor Conference 2019 on 6ix