Horizon Bancorp, Inc. · NASDAQ:HBNC
Horizon Bancorp — Shareholder Meeting (May 2011)
44 slides from Horizon Bancorp's shareholder meeting presentation, May 5, 2011
Slide 1: Horizon: Serving the Community Since 1873
HORIZON _..... Serving the Community Since 1873
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation may contain forward-looking statements regarding the financial performance, business, and future operations of Horizon Bancorp and its affiliates (collectively, “Horizon”). For these statements, Horizon claims the protection of the safe harbor for forward
Slide 3: Thomas H. Edwards, President & Chief Operating Officer
Thomas H. Edwards President & Chief Operating Officer
Slide 4: Horizon's Sound Credit Culture and Asset Quality
Horizon’s Sound Credit Culture and Asset Quality
Slide 5: Sound Credit Culture
Sound Credit Culture • Team of Seasoned Underwriters – Average Tenure > 20 years • Primarily an In-Market and Full Recourse Lender • Predominately a Secured Lender • Retail & Business Focus – Average Commercial Loan Size Approximately $250,000 – Sweet Spot - Retail and Business Focus • We Manage Len
Slide 6: "Low Percentage" of Development Loans
“Low Percentage” of Development Loans Commercial Loans As a Percent of Total Loans at March 31, 2011 Construction - Development and Spec Homes Spec Land Loans $2,249 Commercial and $8,272 0.3% Industrial one 1% 43,724 Automotive /RV pe 5% $7,326 % ad Owner Occupied RE $124,559 as Non Owner Occupied
Slide 7: Diversity in Non-Performing & Real Estate Owned
Diversity in Non-Performing & Real Estate Owned Non-Performing and REO By Classification at March 31, 2011 Dollars in Millions Non-Performing Loans - $22.1 Other Real Estate Owned - $2.3
Slide 8: Consumer Loans Lead in Dollars Charged-off
Consumer Loans Lead in Dollars Charged-off By Type Of Loan
Slide 9: Horizon Builds Loan Loss Reserve
Horizon Builds Loan Loss Reserve
Slide 10: Horizon Outperforms Peer Groups
Horizon Outperforms Peer Groups Non-Performing Loans Plus OREO to Gross Loans Plus OREO Source: FDIC Uniform Bank Performance Reports as of 12/31/10. Peer is a custom group of 17 publicly traded banks headquartered in the state of Indiana. National peer group consists of insured commercial banks hav
Slide 11: Foreclosure Is Option Of Last Resort
Foreclosure Is Option Of Last Resort Foreclosure Mitigation Policy and Procedures • Review each delinquent case to seek alternatives to foreclosure • Offer financial alternatives to customers • Pursue financial alternatives even after foreclosure is initiated • Note modifications • Payment extension
Slide 12: Craig M. Dwight, Chief Executive Officer
Craig M. Dwight Chief Executive Officer
Slide 13: The Current Banking Environment and Horizon's Response
The Current Banking Environment and Horizon’s Response
Slide 14: "May You Live in Interesting Times"
“May You Live in Interesting Times”
Slide 15: Word counts: Dodd-Frank Act versus historic documents
Lord's Prayer: 66 words Archimedes' Principle: 67 words 10 Commandments: 179 words Lincoln's Gettysburg address: 286 words U.S. Declaration of Independence: 1,300 words Dodd-Frank Act: ≈ 200,000 words
Slide 16: New Regulations Will Have Adverse Affect on the Industry
New Regulations Will Have Adverse Affect on the Industry • Lower Revenues – Consumer Finance Protection Bureau – Durbin amendment – Mortgage pricing • Higher Costs – Implementation & systems up-grades – Compliance & training – Lost opportunity – Horizon has expanded its regulatory compliance team •
Slide 17: Horizon is Meeting the Challenge for a Once in a Lifetime Opportunity
Horizon is Meeting the Challenge for a Once in a Lifetime Opportunity
Slide 18: Companies That Effectively Deal with Change & Execute Well Lead the Industry
Companies That Effectively Deal with Change & Execute Well Lead the Industry!
Slide 19: Horizon is an Industry Leader
Horizon is an Industry Leader • Great Team of Advisors (a/k/a Employees) – We look for solutions – We have a history of getting things done – We look for opportunities • Good Historical Performance - Indicator of Future Ability • Energy and Desire to Improve • Positive Feedback from Shareholders & I
Slide 20: Horizon Will Increase Revenue
Horizon Will Increase Revenue • Organic Growth – Commercial lending team expanded – Treasury management team expanded – New retail mortgage sales manager – Increase in trust administrators – Opening new banking markets
Slide 21: Horizon Will Be a Consolidator of Community Banks
Horizon Will Be a Consolidator of Community Banks Challenges Confronting Community Banks • Poor earnings run rate • Capital constraints • Asset quality challenges • Limited growth opportunities • Increase in regulatory burden • Increase in director liability • Limited capacity to manage the magnitud
Slide 22: Once in a Lifetime Opportunity
Once in a Lifetime Opportunity Experts Agree Significant Banking Industry Consolidation is Inevitable Horizon Offers: • Cooperative, Non-Hostile Approach • Open, Clear Communication with Acquired Companies’ Employees • Excellent Corporate Culture: People are Proud to Work for Horizon • Ability to Le
Slide 23: Target Region for Expansion
Target Region for Expansion Michigan City
Slide 24: Horizon's Story
H orizon’s Story Financial Strength Consistent Performance Superior Returns
Slide 25: Horizon's Corporate Profile
*Based on price at the close of business on April 30, 2011 at $27.00 per share **Total assets and deposits as of March 31, 2011 Horizon’s Corporate Profile • Shares Outstanding 3.3 Million • Market Cap* $89.9 Million • Total Assets** $ 1.4 Billion • Total Deposits** $ 1.0 Billion • Branches 22 • Own
Slide 26: Horizon Locations
Horizon Locations Michigan City
Slide 27: Horizon Achieves Three New Milestones in 2010
• Net Income Exceeds $10 million • Record Earnings for Eleven Consecutive Years • Deposits Surpassed $1 Billion in Fourth Quarter • Horizon’s Business Model is Working as Planned Horizon Achieves Three New Milestones in 2010
Slide 28: Balanced & Complementary Business Model
Balanced & Complementary Business Model #1 - Business Banking #2 - Retail Banking #3 - Retail Mortgage Banking #4 - Wealth Management #5 - Mortgage Warehousing Complementary Revenue Streams that are Counter-Cyclical to Varying Economic Cycles
Slide 29: Record Earnings "Eleven" Consecutive Years
Record Earnings “Eleven” Consecutive Years CAGR 10.70 % Dollars in Millions
Slide 30: Horizon Has Record First Quarter Earnings
Horizon Has Record First Quarter Earnings Dollars in Thousands
Slide 31: Horizon More Profitable Than State & National Peers
Source: Uniform Bank Performance Reports. Indiana and Michigan are state averages for all insured commercial banks. National is all insured commercial banks with assets between $1 billion and $3 billion. 2008 2009 2010 Horizon More Profitable Than State & National Peers As Measured By Return On Aver
Slide 32: Peer comparison data
Peer Data Source: KBW Report dated January 2011 covering Indiana Publicly Traded Banks; peer data represents a peer average and is as of December 2010 for all periods reviewed.
Slide 33: Steady Asset Growth
Steady Asset Growth CAGR 10.17% 2000 to 2010
Slide 34: Increasing Core Deposits
CAGR 8.54% 2000 to 2010 Increasing Core Deposits
Slide 35: Horizon
HORIZON. __HORIZON
Slide 36: Excellent Financial Metrics
Excellent Financial Metrics • Consistent & Stable Quarterly Dividend Payments – Over twenty-five years of uninterrupted dividends – Cash reserves at the holding company • Solid Earnings Performance • Efficient Operations • Good Historical Growth – Assets – Deposits – Earnings
Slide 37: Horizon is Highly Regarded In Our Communities
Horizon is Highly Regarded In Our Communities • Nine out of Ten Customers - Would Refer a Friend • Best Bank - The News Dispatch Readers Poll - Ten out of Last Eleven Years • Best Trust Company - NW Indiana Business Quarterly • Best Place to Work - NW Indiana Business Quarterly • Family Friendly Wor
Slide 38: Growth Opportunities
Growth Opportunities • Lake Michigan Corridor Primed for Growth • Super Regional Banks Cutting Back - Market Share Opportunities • Consolidation Opportunities Increasing for Good Performing Banks
Slide 39: Horizon is an Attractive Value
Horizon Bancorp* Median Indiana Banks** Dividend Yield 2.5% 1.9% Price to Book 91.7% 82.0% Price to Tangible Book 100.5% 90.1% Price to Earnings (LTM) 9.0x 14.0x *Horizon Bancorp data as of March 31, 2011 **Peer Data Source: KBW Report as of March 2011 Covering Indiana Publicly Traded Horizon is an
Slide 40: Horizon Outperforms Bank Index - One Year
Horizon Outperforms Bank Index - One Year
Slide 41: Horizon Outperforms Bank Index - Ten Years
Horizon Outperforms Bank Index - Ten Years
Slide 42: Bauer Financial - "Recommends"
Bauer Financial - “Recommends” All Five-Star and Four-Star Institutions Source: www.bauerfinancial.com - Telephone 800.388.6686 "Because peace of mind matters"
Slide 43: Bauer Financial source
Source: www.bauerfinancial.com - Telephone: 800.388.6686
Slide 44: A NASDAQ Traded Company - Symbol HBNC
A NASDAQ Traded Company - Symbol HBNC