German American Bancorp, Inc. · NASDAQ:GABC
German American Bancorp — Investor Presentation (November 2022)
29 slides from German American Bancorp's investor presentation, Nov 15, 2022
Slide 1: German American Investor Presentation
German American Symbol: GABC November 15, 2022 Investor Presentation
Slide 2: Presented By
Presented By 2 D. Neil Dauby, President and Chief Executive Officer (812) 482-0707 neil.dauby@germanamerican.com Bradley M. Rust, Sr. EVP, COO and CFO (812) 482-0718 brad.rust@germanamerican.com
Slide 3: Cautionary Note Regarding Forward-Looking Statements
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS When used in this presentation and our oral statements, the words or phrases “believe,” “will likely result,” “are expected to,” “will continue,” “is anticipated,” “estimate,” “project,” “plans,” or similar expressions are intended to identify “fo
Slide 4: Who We Are
Who We Are Indiana & Kentucky Community-focused Financial Services Organization • Banking, Insurance, Investments & Trust • $6.3 Billion Total Banking Assets • $2.1 Billion Investment and Trust Assets Under Management • $71 Million Annual Insurance Premiums • ~ 850 Team Members • 78 Banking Offices
Slide 5: History of Superior Financial Performance
Hi st or y of S up er io r Fi na nc ia l P er fo rm an ce - Ten Consecutive Years of Increased Dividends - Twelve Years of Consecutive Record Earnings Performance - Double-Digit Return on Equity for 17 Consecutive Fiscal Years - Raymond James 2012-2017 and 2019-2021 Community Bankers Cup Recipient -
Slide 6: Financial Trends
FINANCIAL TRENDS 6
Slide 7: Total Assets and Annualized Return on Assets
$3,144 $3,929 $4,398 $4,978 $5,609 $6,260 1.35% 1.38% 1.43% 1.32% 1.57% 1.16% $- $1,000 $2,000 $3,000 $4,000 $5,000 $6,000 $7,000 12/31/17 12/31/18 12/31/19 12/31/20 12/31/21 09/30/22 (Dollars in Millions) Total Assets Annualized Return on Assets 7
Slide 8: Total Loans, Net of Unearned Income
$2,142 $2,728 $3,077 $3,088 $3,004 $3,683 81% 78% 80% 82% 81% 81% $- $250 $500 $750 $1,000 $1,250 $1,500 $1,750 $2,000 $2,250 $2,500 $2,750 $3,000 $3,250 $3,500 $3,750 $4,000 12/31/17 12/31/18 12/31/19 12/31/20 12/31/21 09/30/22 (Dollars in Millions) Total Loans, Net of Unearned Income Commercial &
Slide 9: Loan Portfolio Composition
Total Loans $3,682.5 million Loan Portfolio Composition as of September 30, 2022 9 Construction & Development Loans, $356.1 million, 10% Agricultural Loans, $409.6 million, 11% Commercial & Industrial Loans, $579.6 , million 16% Commercial Real Estate Owner Occupied, $457.2 million, 12% Commercial R
Slide 10: Non-Performing Assets to Total Assets
0.38% 0.34% 0.33% 0.44% 0.26% 0.22% 0.48% 0.45% 0.45% 0.52% 0.34% 0.31% * 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 12/31/17 12/31/18 12/31/19 12/31/20 12/31/21 09/30/22 Non-Performing Assets to Total Assets GABC Peer Group 10 *Peer Group (St. Louis Federal Reserve District BHC with Total Assets between $
Slide 11: Total Deposits
$2,484 $3,073 $3,430 $4,107 $4,744 $5,574 84% 81% 82% 88% 93% 92% $(500) $500 $1,500 $2,500 $3,500 $4,500 $5,500 $6,500 12/31/17 12/31/18 12/31/19 12/31/20 12/31/21 09/30/22 (Dollars in Millions) Total Deposits Non-Maturity Deposit Accounts as % of Total Deposits 11
Slide 12: Deposit Composition
Non-Interest Bearing Demand, $ 1,755.1 million, 31% Interest Bearing Demand, Savings & Money Market, $ 3,381.1 million, 61% Time Deposits, $ 438.1 million, 8% Deposit Composition as of September 30, 2022 Total Deposits $5,574.3 million 12 Year Cost of Deposits Cost of Funds 2017 0.30% 0.40% 2018 0.5
Slide 13: Shareholders' Equity and Return on Tangible Equity
$365 $459 $574 $625 $668 $495 13.82% 14.82% 14.98% 13.46% 16.38% 16.95% $- $50 $100 $150 $200 $250 $300 $350 $400 $450 $500 $550 $600 $650 $700 $750 12/31/17 12/31/18 12/31/19 12/31/20 12/31/21 09/30/22 (Dollars in Millions) Total Shareholders’ Equity Annualized Return on Tangible Equity 13
Slide 14: Net Interest Income and Net Interest Margin
$99,909 $114,610 $145,225 $155,243 $160,830 $120,099 $148,203 3.76% 3.75% 3.92% 3.63% 3.31% 3.34% 3.35% 3.00% 3.50% 4.00% 4.50% 5.00% 5.50% $- $20,000 $40,000 $60,000 $80,000 $100,000 $120,000 $140,000 $160,000 $180,000 12/31/17 12/31/18 12/31/19 12/31/20 12/31/21 YTD 09/30/21 YTD 09/30/22 (Dollars
Slide 15: Provision for Credit Losses
$1,750 $2,070 $5,325 $17,550 $(6,500) $(8,500) $5,850 $(450) 0.04% 0.08% 0.17% 0.08% 0.11% 0.02% 0.05% $(9,000) $(7,000) $(5,000) $(3,000) $(1,000) $1,000 $3,000 $5,000 $7,000 $9,000 $11,000 $13,000 $15,000 $17,000 $19,000 12/31/17 12/31/18 12/31/19 12/31/20 12/31/21 YTD 09/30/21 YTD 09/30/22 YTD 09
Slide 16: Non-Interest Income
$31,854 $37,070 $45,501 $54,474 $59,462 $44,495 $45,465 24% 24% 24% 26% 27% 27% 23% 22% 27% 32% 37% 42% 47% 52% 57% 62% 67% $- $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 12/31/17 12/31/18 12/31/19 12/31/20 12/31/21 YTD 09/30/21 YTD 09/30/22(Dollars in Thousands) Non-Interest Income Non-
Slide 17: Non-Interest Income Composition
17 Wealth Management Fees, $7.6, 17% Service Charges on Deposit Accounts, $8.6, 19% Insurance Revenues, $8.0, 18% Interchange Fee Income, $11.9, 26% Other Operating Income, $5.6, 12% Net Gains on Sales of Loans, $3.3, 7% Net Gains on Sales of Securities, $0.5, 1% Non-Interest Income as of September
Slide 18: Non-Interest Expense and Efficiency Ratio
$77,803 $93,553 $114,162 $117,123 $124,007 $92,740 $118,577 $106,301 56.8% 60.6% 59.0% 55.0% 55.1% 55.2% 59.7% 53.5% 50.0% 55.0% 60.0% 65.0% 70.0% 75.0% 80.0% $- $20,000 $40,000 $60,000 $80,000 $100,000 $120,000 $140,000 12/31/17 12/31/18 12/31/19 12/31/20 12/31/21 YTD 09/30/21 YTD 09/30/22 YTD 09/3
Slide 19: Net Income and Earnings Per Share
$40,676 $46,529 $59,222 $62,210 $84,137 $64,865 $57,410 $71,471 $1.77 $1.99 $2.29 $2.34 $3.17 $2.44 $1.95 $2.43 $- $1.00 $2.00 $3.00 $4.00 $5.00 $6.00 $7.00 $8.00 $9.00 $10.00 $- $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000 $90,000 12/31/17 12/31/18 12/31/19 12/31/20 12/31/21 YTD
Slide 20: Attractive Addition to Kentucky Franchise
Attractive Addition to Kentucky Franchise GABC CUB Pro Forma Branch Map 20 Completed M & A- Citizens Union Bank Balance Sheet at December 31, 2021 ($M) Source: S&P Global Market Intelligence, Company documents 1) Demographic & deposit data as of June 30, 2021
Slide 21: Citizens Union Bank Acquisition Rationale
21 • Attractive addition to German American franchise effective January 1, 2022: – Expands GABC’s market share position in the attractive Louisville, KY market (1) • Tripling market share to 2.47%, a top-10 overall market share position in a major metro market • Increases German American’s deposit m
Slide 22: Why Invest in GABC?
WHY INVEST IN GABC? 22
Slide 23: GABC Earnings Per Share Growth
23 Why Invest in GABC? $1.27 $1.32 $1.43 $1.51 $1.57 $1.77 $1.99 $2.29 $2.34 $3.17 GABC Earnings Per Share Growth * As of 12/31 for years shown *Earnings Per Share adjusted for 3-for-2 stock split completed in 2017
Slide 24: GABC Tangible Book Value Per Share
24 $8.62 $8.92 $10.40 $11.57 $11.94 $13.45 $13.81 $16.49 $18.63 $20.37 GABC Tangible Book Value Per Share Why Invest in GABC? * As of 12/31 for years shown *Tangible Book Value Per Share adjusted for 3-for-2 stock split completed in 2017
Slide 25: GABC Stock Price Appreciation
25 $14.48 $18.95 $20.35 $22.21 $35.07 $35.33 $27.77 $35.62 $33.09 $38.98 GABC Stock Price Appreciation Why Invest in GABC? As of 12/31 for years shown * *Stock Price adjusted for 3-for-2 stock split completed in 2017
Slide 26: Why Invest in GABC
Why Invest in GABC 26 • Proven Executive Management Team • Track Record of Consistent Top Quartile Financial Performance • Experienced in Operating Plan Execution and M & A Transitions • Potential Growth within New Market Areas – Small MSA Focus and Large Major Metro Opportunity • Existing Platform
Slide 27: Use of Non-GAAP Measures
USE OF NON-GAAP MEASURES The accounting and reporting policies of German American Bancorp, Inc. (the “Company”) conform to U.S. generally accepted accounting principles ("GAAP") and general practices within the banking industry. As a supplement to GAAP, the Company has provided certain, non-GAAP fin
Slide 28: Use of Non-GAAP Measures: Reconciliation
USE OF NON-GAAP MEASURES Non-GAAP Reconciliation { (Dollars in thousands, except per Adjusted YTD | _ share amounts) i | Total Revenue $ O9/30/22 | 193,668 | ncome Before Income Taxes = The Provision for Credit Losses adjustment reflects the initial increase in allowance for credit losses required o
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