Ameriserv Financial Inc. · NASDAQ:ASRV
Ameriserv Financial — Investor Presentation (August 2024)
43 slides from Ameriserv Financial's investor presentation, Aug 21, 2024
Slide 1: 2024 Investor Presentation
2024 Investor Presentation AUGUST 2024
Slide 2: Forward-Looking Statements
Forward - Looking Statements 2 This presentation contains various forward - looking statements and includes assumptions concerning the Company’s beliefs, plans, objectives, goals, expectations, anticipations, estimates, intentions, operations, future results, and prospects, including statements that
Slide 3: Net Income
Net Income $6,028 $4,598 $7,072 $7,448 ($3,346) ($4,000) ($2,000) $0 $2,000 $4,000 $6,000 $8,000 2019 2020 2021 2022 2023 3 (Thousands)
Slide 4: Earnings Per Common Share
Earnings Per Common Share $0.35 $0.27 $0.41 $0.43 ($0.20) ($0.20) ($0.10) $0.00 $0.10 $0.20 $0.30 $0.40 $0.50 2019 2020 2021 2022 2023 4
Slide 5: Net Interest Income
Net Interest Income $35,442 $36,367 $39,083 $40,563 $36,020 $25,000.00 $35,000.00 $45,000.00 2019 2020 2021 2022 2023 5 (Thousands)
Slide 6: Net Interest Margin %
Net Interest Margin % 3.29% 3.19% 3.15% 3.27% 2.86% 1.50% 2.00% 2.50% 3.00% 3.50% 4.00% 2019 2020 2021 2022 2023 6
Slide 7: Total Average Loans
Total Average Loans $875 $923 $989 $978 $997 $600 $700 $800 $900 $1,000 2019 2020 2021 2022 2023 7 (Millions)
Slide 8: Total Average Deposits
Total Average Deposits $980 $1,035 $1,154 $1,156 $1,154 $700 $800 $900 $1,000 $1,100 $1,200 2019 2020 2021 2022 2023 8 (Millions)
Slide 9: Provision for Credit Losses vs. Net Charge-Offs
Provision for Credit Losses vs. Net Charge - Offs $0 $2,000 $4,000 $6,000 $8,000 2019 2020 2021 2022 2023 $800 $2,375 $1,100 $50 $7,429 $192 $309 $47 $1,705 $3,457 9 (Thousands)
Slide 10: Non-Performing Assets
Non - Performing Assets $2,339 $3,331 $3,323 $5,200 $12,393 $0 $3,000 $6,000 $9,000 $12,000 $15,000 2019 2020 2021 2022 2023 10 (Thousands)
Slide 11: Non-Interest Revenue
Non - Interest Revenue $14,773 $16,275 $17,761 $16,692 $16,389 $12,000 $14,000 $16,000 $18,000 2019 2020 2021 2022 2023 11 (Thousands)
Slide 12: Non-Interest Expense
Non - Interest Expense $41,815 $44,455 $46,970 $48,004 $47,141 $2,227 $35,000 $40,000 $45,000 $50,000 $55,000 2019 2020 2021 2022 2023 12 $ 49,368 Activist Related Expenses Non - Interest Expense Excluding Activist Related Expenses (Thousands)
Slide 13: 2023 Summary
13 2023 Summary • Overall, the Company’s 2023 net loss primarily reflects the significantly higher provision for credit losses, decreased net interest income and increased total non - interest expense. • Despite the net loss recognized for 2023, the Company continued to see several encouraging new b
Slide 14: Overview of AmeriServ Financial, Inc.
Branch Map Overview ▪ $1.4 Billion Community Bank Headquartered in Johnstown, PA ▪ 16 Retail Branches ▪ 2 Loan Production Offices ▪ Sizable Wealth Management Company with $2.6 Billion Assets Under Administration ▪ Stable deposit base in core markets with 20% deposit market share in Cambria County ▪
Slide 15: Net Income/Loss
Net Income/Loss $2,418 $1,981 $2,102 $947 $1,515 ($187) $648 ($5,322) $1,904 ($375) ($6,500) ($4,000) ($1,500) $1,000 $3,500 1Q '22 2Q 3Q 4Q 1Q '23 2Q 3Q 4Q 1Q '24 2Q 15 (Thousands)
Slide 16: Earnings Per Share
Earnings Per Share $0.14 $0.12 $0.12 $0.06 $0.09 ($0.01) $0.04 ($0.31) $0.11 ($0.02) ($0.35) ($0.25) ($0.15) ($0.05) $0.05 $0.15 1Q '22 2Q 3Q 4Q 1Q '23 2Q 3Q 4Q 1Q '24 2Q 16
Slide 17: Key Constituents We Manage For
Key Constituents We Manage For AmeriServ Strategic Plan Shareholders Customers Employees Community 17
Slide 18: AmeriServ Strategic Plan
Create long - term value for our shareholders by: • Maintaining financially strong balance sheet • Appropriately managing risk • Improving earnings performance • Disciplined capital allocation AmeriServ Strategic Plan 18
Slide 19: Deposit Composition
Demand Deposits $176 Savings, NOW & Money Market $667 Certificates of Deposit $317 Jumbo Certificates of Deposit $10 15% 57% 27% 1% $1.170 Billion Deposit Composition ($mm) As of June 30, 2024 19 Financially Strong Balance Sheet
Slide 20: Loan Portfolio Composition
Residential Mortgage $179 Home Equity & Consumer $104 Commercial & Industrial $154 Commercial Real Estate $602 $1.039 B illion 73% Commercial / 27% Retail Non - Owner Occupied CRE / Total Capital Ratio: 380% 20 Loan Portfolio Composition ($mm) As of June 30, 2024 Financially Strong Balance Sheet
Slide 21: Commercial Loan Portfolio Diversification
$236 31% $289 38% $100 13% $131 18% Johnstown Pittsburgh Hagerstown State College/Altoona Loan Total = $756 Million 21 Commercial Loan Portfolio Diversification ($mm) As of June 30, 2024 Financially Strong Balance Sheet
Slide 22: Interest Rate Risk
Interest Rate Risk • Proactive steps taken to address net interest margin compression in 2023 which included the execution of $70 million of interest rate hedges • Prudently extending FHLB borrowings to take advantage of the inverted yield curve • Meaningful scheduled asset repricing projected to be
Slide 23: Net Interest Income
Net Interest Income $9,767 $10,124 $10,529 $10,143 $9,522 $9,110 $8,800 $8,589 $8,747 $8,874 $6,000 $7,000 $8,000 $9,000 $10,000 $11,000 1Q '22 2Q 3Q 4Q 1Q '23 2Q 3Q 4Q 1Q '24 2Q 23 (Thousands)
Slide 24: Net Interest Margin
Net Interest Margin 3.14% 3.23% 3.35% 3.21% 3.03% 2.89% 2.76% 2.63% 2.70% 2.74% 2.00% 2.50% 3.00% 3.50% 1Q '22 2Q 3Q 4Q 1Q '23 2Q 3Q 4Q 1Q '24 2Q 24
Slide 25: Average Deposits vs. Total Deposit Cost %
Average Deposits vs. Total Deposit Cost % 983 1,036 1,054 1,067 1,103 1,165 1,189 1,161 1,159 1,163 1,159 1,145 1,149 1,158 1,149 1,159 1,160 1,163 1.01% 0.73% 0.65% 0.59% 0.52% 0.45% 0.40% 0.31% 0.28% 0.33% 0.59% 1.02% 1.48% 1.74% 1.95% 2.11% 2.15% 2.21% 0.00% 0.25% 0.50% 0.75% 1.00% 1.25% 1.50% 1.
Slide 26: Liquidity Risk
Liquidity Risk • Stable diverse core deposit base generated in our local communities • Do not use brokered deposits as a funding source • Bank has experienced deposit growth in 2024 • Available unused borrowing capacity in excess of $275 million at the FHLB which sharply exceeds our level of uninsur
Slide 27: Analysis of Insured Deposits
Insured Deposits Under $250,000 Public Funds that are Collateralized Uninsured Deposits 22% 12% 66% 27 Analysis of Insured Deposits As of June 30, 2024 Financially Strong Balance Sheet
Slide 28: Credit Risk
28 Credit Risk • Despite the fourth quarter 2023 adverse credit performance related primarily to the Rite Aid bankruptcy, the Company has a longer - term history of disciplined underwriting, robust CRE risk management practices and low net loan charge - offs • Non - performing assets amounted to $12
Slide 29: Non-Performing Assets
Non - Performing Assets $3,401 $3,240 $4,596 $5,200 $4,599 $5,650 $5,939 $12,393 $12,161 $12,817 $0 $3,000 $6,000 $9,000 $12,000 $15,000 1Q '22 2Q 3Q 4Q 1Q '23 2Q 3Q 4Q 1Q '24 2Q 29 (Thousands)
Slide 30: Non-Performing Asset Details
• $6.2 million CRE Loan – Charged down to appraised value in fourth quarter of 2023 and currently in non - accrual status. Secured by mixed use office and retail property located in a desirable neighborhood within the city of Pittsburgh • $3.6 million CRE Loan – Currently rated substandard due to sl
Slide 31: Strategic Outlook for 2024 and 2025
• Generate positive operating leverage by growing revenues at a faster pace than expenses • Further leverage union related revenue streams • Continue our diligent focus on capital allocation Strategic Outlook for 2024 and 2025 31
Slide 32: Revenue Diversification Promotes Positive Operating Leverage
Non - Interest Income 35% Net Interest Income 65% ASRV generates more revenue from non - interest income than our peers due to our strong wealth management company. 32 Revenue Diversification Promotes Positive Operating Leverage
Slide 33: Wealth Management Revenue Diversification
• Profitable Company with good financial contribution to ASRV • Good Diversification of business lines within Wealth Management: ▪ Retirement Services, Personal Trust, Investment Management, ERECT Fund & Diversified Services. • Scalable business model well positioned for further growth Wealth Manage
Slide 34: Wealth Management Revenue
Wealth Management Revenue $3,165 $2,976 $2,813 $2,665 $2,736 $2,788 $2,844 $2,897 $3,266 $3,059 $1,000 $2,000 $3,000 $4,000 1Q '22 2Q 3Q 4Q 1Q '23 2Q 3Q 4Q 1Q '24 2Q 34 (Thousands)
Slide 35: Leverage Union Relationships to Generate Revenue
• Wealth Management Company is trustee for the $250 million ERECT FUND • ASRV Bank is a preferred mortgage and consumer loan provider for the Pennsylvania State Education Association ▪ Expands our reach on these products to customers throughout Pennsylvania ▪ Since inception we have originated $252
Slide 36: Capital Allocation Strategies
• Return capital to shareholders through dividends, share repurchases, or both if feasible • Focus on growing EPS, book value and tangible book value per share • Capital return strategies are always subject to maintaining sufficient capital to support balance sheet growth • We conservatively built o
Slide 37: Regulatory Capital Ratios
Regulatory Capital Ratios 9.23% 9.23% 12.76% 7.71% 10.44% 10.44% 11.69% 8.76% 0.00% 3.00% 6.00% 9.00% 12.00% 15.00% Common Equity Tier 1 Capital Ratio Tier 1 Capital Ratio Total Capital Ratio Tier 1 Leverage Ratio Consolidated Bank 37 As of June 30, 2024 Regulatory Well - Capitalized Requirement
Slide 38: Capital Returns to Shareholders
Capital Returns to Shareholders (Thousands) 38 2020 2021 2022 2023 Jan - Jun 2024 Total Common Stock BuyBack Program 151 - - - 1,510 1,661 Common Stock Dividends 1,716 1,708 1,967 2,058 1,029 8,478 Total Capital Returned 1,867 1,708 1,967 2,058 2,539 10,139 Net Income 4,598 7,072 7,448 (3,346) 1,529
Slide 39: Capital Allocation – Common Stock Dividends
Capital Allocation – Common Stock Dividends 39 • Common stock dividends provide shareholders with an ongoing cash return and a competitive dividend yield of approximately 5% based upon the current stock price • ASRV has demonstrated a longer - term pattern of responsible dividend increases which cor
Slide 40: Common Dividend Per Share
Common Dividend Per Share $0.010 $0.015 $0.020 $0.025 $0.030 $0.00 $0.01 $0.02 $0.03 $0.04 1Q '15 1Q '16 1Q '17 1Q '18 1Q '19 1Q '20 1Q '21 1Q '22 1Q '23 1Q '24 40
Slide 41: Capital Allocation – Common Stock Buybacks
Capital Allocation – Common Stock Buybacks 41 • The Board of Directors understands the value of returning capital to shareholders through common stock buybacks • Our longer - term capital allocation decisions reflect the consistent use of common stock buybacks to improve tangible book value and earn
Slide 42: Tangible Book Value Per Share
Tangible Book Value Per Share $5.84 $5.41 $5.13 $5.40 $5.38 $5.24 $5.11 $5.16 $5.26 $5.45 $3.75 $4.25 $4.75 $5.25 $5.75 $6.25 1Q '22 2Q 3Q 4Q 1Q '23 2Q 3Q 4Q 1Q '24 2Q 42
Slide 43: 2024
2024 Investor Presentation AUGUST 2024
Ameriserv Financial — Investor Presentation (August 2024) on 6ix