Eagle Bancorp, Inc. · NASDAQ:EGBN
Eagle Bancorp — Investor Presentation (September 2021)
37 slides from Eagle Bancorp's investor presentation, Sep 13, 2021
Slide 1: Investor Presentation
Investor Presentation Ticker: EGBN EagleBankCorp.com September 2021
Slide 2: Forward Looking Statements
Forward Looking Statements 2 This presentation contains forward looking statements within the meaning of the Securities and Exchange Act of 1934, as amended, including statements of goals, intentions, and expectations as to future trends, plans, events or results of Company operations and policies a
Slide 3: Experienced Senior Management Team
Experienced Senior Management Team 3 Susan Riel CEO & President, Eagle Bancorp & EagleBank 45 years in banking 24 years with EGBN Charles Levingston EVP & Chief Financial Officer, Eagle Bancorp & EagleBank 21 years in banking 9 years with EGBN Executive Vice President and Chief Financial Officer of
Slide 4: Experienced Senior Management Team
Experienced Senior Management Team 4 Joined EagleBank in June 2020 as the Chief Risk Officer. Prior to this, he was Managing Director for the Risk and Finance Advisory Practice in Deloitte’s Banking and Capital Markets Group, where he focused on the development of ERM and risk-category-specific gove
Slide 5: Board Focused on Vision and Oversight
Board Focused on Vision and Oversight 5 Norman Pozez Executive Chair - Board of Directors 13 years with EGBN Kathy Raffa Director, Chair - Audit Committee 6 years with EGBN Leslie Ludwig Director, Chair - Compensation Committee 4 years with EGBN Theresa LaPlaca Director, Chair - Risk Committee 2 yea
Slide 6: Summary Statistics
Summary Statistics 6 Total Assets $ billion Total Loans $ billion Total Deposits $ billion Tangible Common Equity $ billion Shares Outstanding 31,961,573 Market Capitalization $1.8 billion Tangible Book Value per Common Share $37.58 Institutional Ownership 77% Member of Russell 2000 yes Member of S&
Slide 7: Our Story
Our Story 7 *As of June 30, 2021. **Please refer to the Non-GAAP reconciliation and footnotes in the appendices. Note: TBVPS is adjusted for - 5:4 stock split 3/31/2000, 7:5 stock split 6/15/2001, 1.3:1 stock split 2/28/2005; 1.3:1 stock split 7/5/2006; 10% stock dividend 10/1/2008 and 10% stock div
Slide 8: Investment Rationale
Investment Rationale 8 Solid capitalization and conservative capital management Well-managed asset quality Above average peer returns (ROAA) Superior efficiency with limited branch network Recognized expertise in CRE, C&I and residential mortgage lending Strategically positioned in one of the most a
Slide 9: Key Financial Metrics – 2nd Quarter 2021
Key Financial Metrics – 2nd Quarter 2021 9 • Solid Capital Ratios: – Tangible Common Equity(1) | 11.07% – Tier 1 Leverage | 10.65% – Total Risk Based Capital | 17.98% • Ample Reserves & Clean Asset Quality: – ACL/Loans | 1.28% – NPAs/Assets | 0.50% – NCOs/Average Loans | 0.30% • Strong Returns: – RO
Slide 10: Attractive & Resilient Market
Attractive & Resilient Market 10 • Washington DC MSA – Market is the 6th largest in the U.S. – Population of 6.3 million with a projected annual growth rate of 0.8% through 2026 – Workforce of 3.4 million – 2021 median household income of $109,000 vs. $68,000 U.S. – Unemployment of 5.4% in June 2021
Slide 11: Limited Network of Offices
295 495 95 495 495 270 395 66 66 Bethesda Lanham Chevy Chase Twinbrook Rockville Shady Grove Rosslyn Ballston Silver Spring Park Potomac Merrifield Alexandria Fairfax Tysons Corner Reston Dulles Town Center Chantilly HQ RHQ RHQ MONTGOMERY COUNTY PRINCE GEORGE’S COUNTY FAIRFAX COUNTY ARLINGTON COUNTY
Slide 12: Local Leader in Deposit Share
Local Leader in Deposit Share 12 Note: Market includes Maryland counties of Montgomery and Prince George’s; Virginia counties of Alexandria, Arlington, Fairfax, Fairfax City, Falls Church, Loudoun, Manassas, Manassas Park and Prince William; and the District of Columbia. Data excludes Morgan Stanley
Slide 13: ESG - Social
ESG - Social 13 Diversity of Board & Senior Management • Board of 10 includes 4 women (including the CEO) and 2 men who identify as minorities • Senior Management of 8 includes 2 women and 1 man who identifies as a minority Diversity, Equity & Inclusion Council established in 2020 • 16 diverse emplo
Slide 14: Balance sheet levels off
$7,305 $6,962 $7,022 $455 $565 $238 $4,998 $5,678 $6,412 $6,991 $7,546 $7,760 $7,527 $7,260 2015Y 2016Y 2017Y 2018Y 2019Y 2020Y 2021Q1 2021Q2 (in m ill io ns ) Loans HFI Loans excl PPP PPP Loans $5,158 $5,716 $5,854 $6,974 $7,224 $9,189 $9,199 $9,019 2015Y 2016Y 2017Y 2018Y 2019Y 2020Y 2021Q1 2021Q2
Slide 15: Solid capitalization & growth of RBC
Solid capitalization & growth of RBC 15 Note: Peers are depository institutions with assets from $7-$15 billion as of June 30, 2021 (excludes savings banks, thrifts and mutuals). Source: S&P Global Market Intelligence. Note: Tangible Common Equity is as of period end. • Capitalization ‒ Tangible com
Slide 16: Efficiency continues to be a strength
Efficiency continues to be a strength 16 • Efficiency much better than peers ‒ Focus on higher value business relationships ‒ Branches focused on commercial sub-markets ‒ Average deposits per branch of $475 million • Efficiency components ‒ Net interest income benefitted from large increase in asset
Slide 17: Strong returns
1.52% 1.41% 1.91% 1.61% 1.28% 1.61% 1.01% 0.95% 1.22% 1.22% 0.90% 1.40% 2016Y 2017Y 2018Y 2019Y 2020Y 2021 YTD** Return on Average Assets EagleBancorp Peer Median Strong returns 17 • Return on tangible common equity (non-GAAP) negatively impacted by a higher level of capitalization (TCE/TA 11.07% vs
Slide 18: Tangible book builds, increased dividend
$18.83 $21.61 $24.67 $29.17 $32.67 $35.74 $36.16 $37.58 2015Y 2016Y 2017Y 2018Y 2019Y 2020Y 2021Q1 2021Q2 Tangible Book Value Per Share Tangible book builds, increased dividend 18 • Tangible book continues to rise ‒ TBVPS growth of 13.4% (CAGR) from 2015 through the first half of 2021 • Dividend inc
Slide 19: Asset quality steady, reserves released
0.30% 0.20% 0.21% 0.56% 0.59% 0.51% 0.50% 2016Y 2017Y 2018Y 2019Y 2020Y 2021Q1 2021Q2 NPAs** / Assets 0.09% 0.06% 0.05% 0.13% 0.26% 0.27% 0.30% 2016Y 2017Y 2018Y 2019Y 2020Y 2021Q1 2021Q2 NCO / Average Loans Asset quality steady, reserves released 19 *For the six months ended June 30, 2021. **NPAs i
Slide 20: Margin impacted by deposit inflows
20 Margin impacted by deposit inflows • Large deposit inflows in 2020 lowered margins ‒ Asset mix changed as average loans to average assets moved down to 64.5% ‒ In 2Q, average loans $2.1 billion more than average deposits ‒ 2Q NIM absent PPP loan sale was 2.88%* $5.3 $5.9 $6.6 $7.3 $7.9 $7.7 $7.4
Slide 21: Yield on loans flat, deposit costs down
21 Yield on loans flat, deposit costs down • Yield on Loans* ‒ Loan yield adjusted to exclude accelerated net deferred fees of $4.7 million from PPP sale was 4.52% (reported loan yield was 4.79%) ‒ Continued focus on good credit and stable income producing CRE • Cost of funds ‒ Lowered deposit rates
Slide 22: Deposits leveled off, remain elevated
Deposits leveled off, remain elevated 22 *Core deposits include CDAR’s and ICS reciprocal deposits. **Average noninterest bearing deposits to average deposits is 33% for the second quarter of 2021. Note: Chart is as of period end. • Deposit philosophy ‒ Runoff of higher priced CDs into Money Market
Slide 23: Securities portfolio continues growth
Securities portfolio continues growth 23 • Continue to prudently invest cash balances • Average duration of debt securities ‒ 2Q 2021 - 4.3 years ‒ 1Q 2021 - 4.6 years ‒ 4Q 2020 - 3.2 years *Includes allowance for credit losses. Note: Charts are as of period end. Excludes Federal Reserve and Federal
Slide 24: Loan growth still challenging
Loan growth still challenging 24 • Loan commentary – C&I/Owner Occupied CRE at 32.4% of portfolio is more of a focus than other local banks – C&I Loan Portfolio is predominantly variable rate loans – Owner Occupied Loans are key to small and mid-market relationships – DDA Operating Accounts of C&I r
Slide 25: Loan Portfolio - Details
Loan Portfolio - Details 25 Note: Data as of June 30, 2021. $ in millions Location C&I Owner Occupied CRE Income Producing CRE Owner Occupied Const. CRE Construction Land Residential Mortgage Consumer TOTAL (ex PPP) % of Total (ex PPP) PPP Total Percent of Total District of Columbia $322.8 $248.9 $1
Slide 26: ADC & CRE Concentration
ADC & CRE Concentration 26 Note: ADC and CRE concentration ratios represents concentration as a percentage of consolidated risk-based capital. CRE excludes owner occupied. Charts and data are as of period end. CRE Details ADC Details $ in millions 2020Y 2021 Q1 2021 Q2 Total ADC portfolio $1,378 $1,
Slide 27: Loan Quality – COVID and Other Metrics
Loan Quality – COVID 19 and Other Metrics 27 • COVID-19 Migration ‒ Beginning in the third quarter of 2020, all loans receiving a second COVID-19 deferral or payment deferral were downgraded to a watch rating, if not already rated as such. ‒ This was done to raise the visibility of these loans withi
Slide 28: Mortgages, FHA & SBA
Mortgages, FHA & SBA 28 • Mortgages ‒ Locked loans in 2021 were $552 million ‒ 1Q 2021 about 80% re-fi ‒ 2Q 2021 about 55%-60% re-fi • FHA Multi-Family ‒ 5 dedicated FTE’s ‒ Group started in 2016 ‒ $3.2 million of trade premiums in 1st half of 2021 • SBA ‒ 9/30/2020 - Over 1,400 PPP loans totaled $4
Slide 29: Appendices
Appendices (EAGLE BANCORB INC. 29
Slide 30: Performance Statistics Summary
Performance Statistics Summary 30 Note: Peers are depository institutions with assets from $7-$15 billion as of June 30, 2021 (excludes savings banks, thrifts and mutuals). There were 50 depository institutions within that range as of August 17, 2021, and all were included in the peer group. Source:
Slide 31: Historical Balance Sheet
Historical Balance Sheet 31 $'s in thousands 12/31/2015 12/31/2016 12/31/2017 12/31/2018 12/31/2019 12/31/2020 6/30/2021 5.5 Year Compound Growth Rate Assets Cash and Equivalents $298,363 $368,163 $190,473 $321,864 $241,973 $1,789,055 $1,596,222 35.7% Securities 504,772 559,708 625,592 807,645 878,5
Slide 32: Historical Income Statement
Historical Income Statement 32 *YTD is the six months ended June 30, 2021. **Compounded growth rate uses 2016Y to the six months ended June 30, 2021 annualized. $ in thousands, except per share data 2016Y 2017Y 2018Y 2019Y 2020Y 2021 YTD* Compound Growth Rate 2016 to 6/30/2021** Total Interest Incom
Slide 33: Loan Portfolio – Income Producing CRE
Loan Portfolio – Income Producing CRE 33 Note: Data as of June 30, 2021 $ in millions Office Family & Hotel/ Mixed Multi- & Office Res. % of Location Motel Industrial Use Family Condo Retail Condo Other Total Total District of Columbia $185.5 $14.4 $256.7 $235.1 $106.0 $85.6 $80.8 $171.4 $1,135.5 32
Slide 34: Loan Portfolio – CRE Construction
Loan Portfolio – CRE Construction 34 Note: Data as of June 30, 2021 $ in millions Office Single & Multi- & Office Hotel/ Mixed Residential % of Location 1-4 Family Family Condo Motel Use Retail Condo Other Total Total District of Columbia $36.2 $243.6 $53.5 $0.0 $51.4 $3.1 $33.7 $17.1 $438.6 58.7% S
Slide 35: Non-GAAP Reconciliation (unaudited)
35 Non-GAAP Reconciliation (unaudited) Note: Per share data is adjusted for - 5:4 stock split 3/31/2000, 7:5 stock split 6/15/2001, 1.3:1 stock split 2/28/2005; 1.3:1 stock split 7/5/2006; 10% stock dividend 10/1/2008 and 10% stock dividend 6/14/2013. $ in thousands, except per share data 2000Y 2010
Slide 36: Non-GAAP Reconciliation (unaudited)
36 Non-GAAP Reconciliation (unaudited) $ in thousands Average Average Balance Interest Yield Loan Yield, Adjusted Loan Yield (GAAP) $7,382,238 $88,148 4.79% Less: PPP interest income (non-GAAP) (418,552) (9,752) 9.35% Adjusted loan yield (non-GAAP) $6,963,686 $78,396 4.52% June 30, 2021 For the Quar
Slide 37: Non-GAAP Reconciliation (unaudited)
37 Non-GAAP Reconciliation (unaudited) Note: Tangible common equity to tangible assets (the "tangible common equity ratio"), tangible book value per common share, annualized return on average tangible common equity, and pre-provision net revenue to average assets (“PPNR/AA”) are non-GAAP financial m
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