Sb Financial Group, Inc. · NASDAQ:SBFG
Sb Financial — Shareholder Meeting (April 2023)
35 slides from Sb Financial's shareholder meeting presentation, Apr 20, 2023
Slide 1: 2023 Annual Shareholder Meeting
2023 ANNUAL SHAREHOLDER MEETING S B F I NA NCI A L G RO U P, I NC.
Slide 2: 2022 Business Overview
2022 Business Overview Restltence r sty financial
Slide 3: Safe Harbor Statement
Safe Harbor Statement Certain statements within this document, which are not statements of historical fact, constitute forward - looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward - looking statements involve risks and uncertainties and actual resu
Slide 4: 2022 Highlights
• Net income of $12.5 million or $1.77/share • Net Interest Margin expanded 4.0% • Residential Real Estate Volume $313 million • ROAA 0.95%, ROAE 9.86% • Loan growth of $139 million or 17% * Peer group consists of S&P Capital 2022 data for 65 publicly traded bank holding companies in the U.S. on a m
Slide 5: 2022 Highlights
• Loan Loss Reserve above the 90 th percentile of our Peer group • Non - Core Funding Liquidity Ratio - 8.5% • Total Risk Based Capital of 14.7% • New Loan Production office Zionsville, Indiana and added a commercial lender in Indianapolis * Peer group consists of S&P Capital 2022 data for 65 public
Slide 6: Return On Average Assets (ROAA)
0.25 0.00 0.50 0.75 1.00 1.75 1.50 1.25 2017 2018 2019 2022 R O A A SBFG 2020 2021 Peer Group Top Quartile* * Peer group consists of S&P Capital 2022 data for 65 publicly traded bank holding companies in the U.S. on a major exchange with assets between $500 million and $2.65 billion. 83rd Peer Ranki
Slide 7: Our Organization & Leadership
Our Organization & Leadership EXECUTIVE MANAGEMENT • Mark Klein – Chairman, President/CEO • Tony Cosentino – EVP/CFO • Ernesto Gaytan – EVP/Chief Technology Innovation Officer • Keeta Diller – EVP/Chief Risk Officer • Steve Walz – EVP/Chief Lending Officer • David Homoelle – Regional President, Colu
Slide 8: Unique Qualities: Net Income Contributions
RRE $1.5M / 12% Retail/PCG $0.2M / 1% Peak $0.4M / 3% Commercial/SBA $9.7M / 78% WM $0.7M / 6% NET INCOME CONTRIBUTIONS 2022 NET INCOME $ 12.5 MILLION DECEMBER 2022 ASSETS UNDER MANAGEMENT $3.2 BILLION COMPRISED OF: • $1.3B Commercial Bank • $1.4B Residential Sold Portfolio • $507M Wealth Management
Slide 9: Key Initiatives
Key Initiatives Become a Russell 2000, High - Performing Financial Services Conglomerate Increase profitability through ongoing diversification of revenue streams Strengthen penetration in all markets served Expand product service utilization by new and existing customers Deliver gains in operationa
Slide 10: Key Initiatives
Key Initiatives Become a Russell 2000, High - Performing Financial Services Conglomerate Increase profitability through ongoing diversification of revenue streams Strengthen penetration in all markets served Expand product service utilization by new and existing customers Deliver gains in operationa
Slide 11: Increase Profitability Through Diversification of Revenue Streams
Increase Profitability THROUGH DIVERSIFICATION OF REVENUE STREAMS $0 $5 $10 $15 $20 $0 $15 $30 $45 $60 $75 2018 2019 2020 2021 2022 Fee/Revenue 33.3% 34.1% 45.6% 44.8% 31.5% NET INCOME REVENUE (MIL) TOTAL REVENUE/NET INCOME Peak Title Other SBA Mortgage Service Charges Wealth Manage ment Net Interes
Slide 12: Non-Interest Income/Revenue vs. Peers
* Peer group consists of S&P Capital 2021 data for 65 publicly traded bank holding companies in the U.S. on a major exchange with assets between $500 million and $2.65 billion 50.0% 45.0% 40.0% 35.0% 30.0% 25.0% 20.0% 15.0% 10.0% 5.0% 0.0% 2018 2019 SBFG 2022 PERCENTAGE NON - INTEREST INCOME/ REVENU
Slide 13: Mortgage Gain on Sale/Volume
$342 $445 $694 $600 $313 $0 $100 $200 $300 $400 $500 $600 $700 $800 $0 $5 $10 $15 $20 $25 $30 2018 NW Ohio 2019 Columbus 2022 MORTGAGE VOLUME (MIL) MORTGAGE GAIN ON SALE (MIL) 2020 Findlay 2021 Indy Total $ Originations Increase Profitability THROUGH DIVERSIFICATION OF REVENUE STREAMS MORTGAGE GAIN
Slide 14: Wealth Management AUM and Revenue Growth
$437 $423 $508 $558 $618 $507 $2.8 $2.9 $3.1 $3.3 $3.8 $3.7 $ - $0.5 $1.0 $1.5 $2.0 $2.5 $3.0 $3.5 $4.0 $ - $100 $200 $300 $400 $500 $600 $700 2017 2018 2019 2020 2021 2022 Wealth Management Revenue ($M) Wealth Management AUM($M) AUM Revenue WEALTH MANAGEMENT AUM AND REVENUE GROWTH 9.9% AUM Growth C
Slide 15: Key Initiatives
Key Initiatives Become a Russell 2000, High - Performing Financial Services Conglomerate Increase profitability through ongoing diversification of revenue streams Strengthen penetration in all markets served Expand product service utilization by new and existing customers Deliver gains in operationa
Slide 16: Historical Growth
$11.1 $11.6 $12.0 $14.9 $18.3 $12.5 $0 $12 2017Y 2018Y 2019Y 2020Y 2021Y 2022Y NET INCOME ($M) $24 $730 $803 $840 $1,049 $1,113 $1,087 $0 $750 2017Y 2018Y 2019Y 2020Y 2021Y 2022Y $877 $987 $1,039 $1,258 $1,330 $1,335 $0 $750 TOTAL ASSETS ($M) $1,500 2017Y 2018Y 2019Y 2020Y 2021Y 2022Y TOTAL DEPOSITS
Slide 17: Loan Portfolio and Total Assets
Loans (Net) 71% Securities 18% 2% Cash & Due Other 9% Commercial RE 43% HELOC 5% 1 - 4 Family 30% Agriculture 7% C&I 13% 2% LOAN PORTFOLIO = $962 MILLION Consumer & Other Strengthen Market Penetration IN ALL MARKETS SERVED 20 Loan to Deposit December 2022 – 89% Top Quartile Performance TOTAL ASSETS
Slide 18: Deposit Portfolio and Funding Sources
Borrowings 8% Deposits 81% Capital 9% Other 2% Time 18% MMDA 23% Savings 18% Interest Bearing 18% Non - Interest 23% Strengthen Market Penetration IN ALL MARKETS SERVED 21 Transactional deposits = 82% of total deposits MRQ average cost of deposits = 53 bps* *December 2022 DEPOSIT PORTFOLIO = $1.1 BI
Slide 19: Key Initiatives
Key Initiatives Become a Russell 2000, High - Performing Financial Services Conglomerate Increase profitability through ongoing diversification of revenue streams Strengthen penetration in all markets served Expand product service utilization by new and existing customers Deliver gains in operationa
Slide 20: Strong Market Leadership
BOWLING GREEN & TOLEDO FULTON & WILLIAMS COUNTIES Mark D. Cassin Tyson R. Moss Chris A. Webb LIMA FINDLAY Andy S. Farley Stefan R. Hartman FORT WAYNE COLUMBUS David A. Homoelle 23 Expand Product Utilization BY NEW AND EXISTING CUSTOMERS STRONG MARKET LEADERSHIP
Slide 21: Electronic Transactions & In-Office Transactions
0 300 600 900 1,200 1,500 0 1,000 2,000 3,000 4,000 5,000 6,000 IN - OFFICE TRANSACTIONS PER YEAR (000’s) ELECTRONIC TRANSACTIONS PER YEAR (000’s) ELECTRONIC TRANSACTIONS & IN - OFFICE TRANSACTIONS 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Electronic Transactions In - Office Transaction
Slide 22: Referrals & New Business
1,857 1,712 1,636 1,312 1,409 1,021 959 811 607 737 $71.3 $79.3 $81.6 $0 $20 $40 $60 $80 $100 $120 0 700 1,400 2,100 2018 2019 2020 2021 2022 NEW BUSINESS (MIL) REFERRALS Gross Closed New Business Expand Product Utilization BY NEW AND EXISTING CUSTOMERS REFERRALS & NEW BUSINESS $92.8 $99.5 25
Slide 23: Key Initiatives
Key Initiatives Become a Russell 2000, High - Performing Financial Services Conglomerate Increase profitability through ongoing diversification of revenue streams Strengthen penetration in all markets served Expand product service utilization by new and existing customers Deliver gains in operationa
Slide 24: Mortgage Servicing Portfolio
$1,084,678 $1,199,107 $1,299,697 $1,362,962 $1,352,016 7,586 8,155 8,543 8,614 8,514 0 1,700 3,400 5,100 6,800 8,500 10,200 $0 $250,000 $500,000 $750,000 $1,000,000 $1,250,000 $1,500,000 NUMBER OF LOANS $ OF LOANS ($000s) MORTGAGE SERVICING PORTFOLIO 2018 2019 Servicing Portfolio 2020 2021 2022 Numb
Slide 25: Total Risk Based Capital
Deliver Gains in Operation Excellence 10.5 13.5 13.4 14.2 15.2 14.7 0 3 6 9 12 15 18 2017 2018 2019 2020 2021 2022 RATIO (%) TOTAL RISK BASED CAPITAL 28
Slide 26: TBV and EPS Performance
$7.98 $9.24 $10.39 $11.59 $13.27 $15.39 $15.23 $16.30 $17.60 $18.28* $1.07 $1.06 $1.19 $1.38 $1.74 $1.51 $1.51 $1.96 $2.56 $1.77 $0.00 $0.50 $1.00 $1.50 $2.00 $2.50 $3.00 $0.00 $2.00 $4.00 $6.00 $8.00 $10.00 $12.00 $14.00 $16.00 $18.00 $20.00 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Earning
Slide 27: Liquidity vs. Uninsured Deposits
$0 $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $0 $50,000 $100,000 $150,000 $200,000 $250,000 $300,000 $350,000 $400,000 2020 2021 2022 LIQUIDITY COVERAGE ($000s) (Cash & FHLB Capacity) UNINSURED DEPOSITS ($000s) LIQUIDITY vs. UNINSURED DEPOSITS Uninsured Deposits Liquidity Coverage Deliver
Slide 28: Loan Production & Loan Growth
Deliver Gains in Operation Excellence $0 $20,000 $40,000 $60,000 $80,000 $100,000 $120,000 $140,000 $160,000 $0 $100,000 $200,000 $300,000 $400,000 $500,000 $600,000 $700,000 $800,000 $900,000 2018 2019 2020 2021 2022 LOAN GROWTH ($000S) LOAN PRODUCTION BY TYPE ($000s) LOAN PRODUCTION & LOAN GROWTH
Slide 29: Key Initiatives
Key Initiatives Become a Russell 2000, High - Performing Financial Services Conglomerate Increase profitability through ongoing diversification of revenue streams Strengthen penetration in all markets served Expand product service utilization by new and existing customers Deliver gains in operationa
Slide 30: Non-Performing Assets / Total Assets
* Peer group consists of S&P Capital 2022 data for 65 publicly traded bank holding companies in the U.S. on a major exchange with assets between $500 million and $2.65 billion. 0.40 0.64 0.58 0.49 0.38 0.76 0.61 0.49 0.41 0.40 0.43 0.39 0.22 0.19 0.20 0.00 0.70 1.40 2018 PERCENTAGE NON - PERFORMING
Slide 31: NCOs / Average Loans
- 0.05% 0.00% 0.05% 0.10% 2018 2019 2020 2021 2022 NCOs/ AVERAGE LOANS SBFG Peer Median* Top Quartile* PERCENTAGE Sustain Asset Quality * Peer group consists of S&P Capital 2022 data for 65 publicly traded bank holding companies in the U.S. on a major exchange with assets between $500 million and $2
Slide 32: Reserve to Non-Performing Loans
0 600 500 400 300 200 100 2018 2021 2022 PERCENTAGE RESERVE TO NON - PERFORMING LOANS 2019 SBFG 2020 Median Top Quartile * Peer group consists of S&P Capital 2022 data for 65 publicly traded bank holding companies in the U.S. on a major exchange with assets between $500 million and $2.65 billion. 35
Slide 33: Loan Loss Reserve
Sustain Asset Quality 1.80 1.60 1.40 1.20 1.00 0.80 0.60 0.40 0.20 0.00 16.0 14.0 12.0 10.0 8.0 6.0 4.0 2.0 0.0 2018 2019 2020 2021 2022 Coverage (%) Reserves (Mil $) LOAN LOSS RESERVE Reserves Coverage $1.4M Added 1/1/23 – CECL Adoption 36
Slide 34: Key Initiatives
Key Initiatives Become a Russell 2000, High - Performing Financial Services Conglomerate Increase profitability through ongoing diversification of revenue streams Strengthen penetration in all markets served Expand product service utilization by new and existing customers Deliver gains in operationa
Slide 35: Thank you for joining us today!
Thank you for joining us today! Board and Management
SB Financial Group — Shareholder Meeting (April 2023) on 6ix