Kearny Financial · NASDAQ:KRNY
Kearny Financial — Shareholder Meeting (October 2016)
20 slides from Kearny Financial's shareholder meeting presentation, Oct 28, 2016
Slide 1: Annual Meeting of Shareholders
Exhibit 99.2 Annual Meeting of Shareholders Nasdaq: KRNY October 27, 2016
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation may include certain “forward-looking statements,” which are made in good faith by Kearny Financial Corp. (the “Company”) pursuant to the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements inv
Slide 3: Overview of Kearny Financial Corp
Overview of Kearny Financial Corp (dollars in millions) as of June 30, 2016 Total Assets $4,500.1 Total Deposits $2,694.8 Total Loans $2,677.3 Corporate Headquarters Fairfield, NJ Branches 42 Market Capitalization¹ $1,250.4 • Founded in 1884 th • 9 Largest New Jersey based deposit franchise – 42 bra
Slide 4: Kearny Bank Mission Statement
Kearny Bank Mission Statement Kearny Bank is dedicated to providing professional service and sound financial advice to our client and shareholder base. This is successfully accomplished through deep-rooted guiding principles of strong values consisting of ethics and integrity, and by giving back to
Slide 5: Core Values
Core Values People Our significant stakeholders, including employees, current and future customers, stockholders, and the communities we serve. Relationships Delivery of superior service, a keen understanding of clients’ needs, and a welcoming environment has resulted in high levels of customer sati
Slide 6: Kearny Value Chain
Kearny Value Chain • Optimization of asset mix – Grow and diversify our commercial real estate lending portfolio – Expand our commercial lending business into new markets – Increase residential mortgage lending – Reinvest cashflows from the investment portfolio into loans while still maintaining a d
Slide 7: Attractive Market Demographics
Attractive Market Demographics • Attractive markets • Weighted average median 2017 projected • Part of the largest household income in MSA¹ in the U.S Kearny franchise • Opportunities still exist counties was $78,304 for organic growth in vs. $57,462 median existing branch footprint household income
Slide 8: Loan Portfolio Growth
Loan Portfolio Growth Kearny Financial Corp. Historical Loan Growth (dollars in millions) $3,000 $2,500 $2,677 $2,000 $2,103 $1,741 $1,500 $1,284 $1,361 $1,268 $1,000 $500 $0 2011FY 2012FY 2013FY 2014FY 2015FY 2016FY Total Loans • Loan growth focus: – Expand upon expertise in commercial real estate,
Slide 9: Loan Portfolio Composition
Loan Portfolio Composition MRQ Loan Portfolio • As of June 30, 2016 KRNY had $2.7 billion in loans receivable, comprising 59.5% of total assets • Kearny’s yield on loans was 3.92% for the 2016 fiscal year 1-4 Family - 22.6% • Kearny continues to make progress towards its intended Multifamily - 38.9%
Slide 10: Commercial Lending Success Continues
Commercial Lending Success Continues 9
Slide 11: Credit Metrics
Credit Metrics NPAs / Assets¹ Loan Loss Reserves / Gross Loans 3.0% 2.0% 2.5% 1.5% 1.28% 2.0% 1.14% 1.69% 1.08% 1.08% 1.58% 1.5% 1.0% 0.88% 0.91% 1.18% 1.34% 0.93% 0.89% 1.0% 0.86% 1.15% 0.79% 0.80% 0.61% 0.60% 0.71% 0.74% 0.92% 0.5% 0.5% 0.74% 0.64% 0.49% 0.0% 0.0% 2011FY 2012FY 2013FY 2014FY 2015F
Slide 12: Securities Portfolio
Securities Portfolio Yield on Securities MRQ Securities Portfolio 3.50% 3.15% 3.00% 2.69% U.S. Agency Obligations - 7.31% 2.50% 2.16% 2.08% 2.08% Municipal Bonds - 8.84% 2.02% 2.00% CLO & ABS Securities - 16.79% Corporate Bonds - 10.99% 1.50% TPS - 0.61% 1.00% Agency MBS - 55.45% Non-Agency MBS - 0.
Slide 13: Deposit Composition
Deposit Composition MRQ Deposit Portfolio • Kearny Financial Corp. had $2.69 billion in Noninterest bearing deposits as of June 30, 2016 deposits - 8.9% – The quarter ended June 30, 2016’s cost of Interest bearing DDA - 27.2% total deposits was 0.72% down from 1.06% for the quarter ended June 30, 20
Slide 14: Improving Performance Metrics
Improving Performance Metrics Profitability Efficiency Ratio $18,000 0.40% 90.00% $15,822 $16,000 0.35% 85.00% 83.02% 0.32% 0.32% 0.36% $14,000 $12,000 0.30% 80.00% 77.45% $10,188 76.52% 76.89% $10,000 0.25% 75.00% $8,000 $6,506 68.50% $5,629 $6,000 $5,078 0.20% 70.00% $4,000 0.19% 0.18% 0.15% 65.00
Slide 15: Maintenance of Strong Capital Ratios
Maintenance of Strong Capital Ratios Tangible Common Equity to Tangible Assets Tier 1 Leverage Ratio 30.0% 30.0% 25.8% 25.6% 23.9% 25.0% 23.7% 25.0% 20.0% 20.0% 15.0% 12.0% 12.1% 13.5% 11.3% 10.8% 15.0% 13.5% 11.8% 11.3% 10.0% 11.8% 11.2% 10.0% 10.2% 9.5% 9.6% 10.0% 5.0% 9.3% 9.5% 9.0% 9.2% 9.7% 9.2
Slide 16: M&A History and Strategy
M&A History and Strategy • Kearny is an experienced acquirer and integrator, having successfully completed 5 bank acquisitions over the past 15 years • Kearny actively seeks out opportunities to deploy capital, including through mergers and acquisitions with other financial institutions – The greate
Slide 17: A Stronger Kearny Financial
A Stronger Kearny Financial • Robust capital to support continued growth – The second step offering allows Kearny to pursue organic and strategic growth opportunities that will continue Kearny’s historically strong loan growth • Facilitates future mergers and acquisitions – Allows for increased flex
Slide 18: 2016 Strategic Focus
2016 Strategic Focus • Traditional Relationship Banking Focus – Growth/ Diversification of loan mix: CRE/Multifamily/C&I/SBA/Residential/Construction/Consumer – Grow funding thru traditional deposit sources utilizing a technological focus: mobile banking/on-line account opening/RDC • Growth/Opportun
Slide 19: Comparative Stock Price Performance
Comparative Stock Price Performance Stock Price Performance since January 1, 2012 KRNY KRNY Peers S&P 500 120% 103.4% 100% 80% 71.1% 66.2% 60% 40% 20% 0% (20%) 1/1/12 7/1/12 1/1/13 7/1/13 1/1/14 7/1/14 1/1/15 7/1/15 1/1/16 7/1/16 Note: Market data as of October 24, 2016 1) Peer group as shown on pag
Slide 20: Peer Group Valuation Comparison
Peer Group Valuation Comparison ($ in thousands) Total Price/ Peer Company Ticker Headquarters Assets TBV Flushing Financial Corporation FFIC Uniondale, NY $5,987 133% Dime Community Bancshares, Inc. DCOM Brooklyn, NY $5,556 127% ConnectOne Bancorp, Inc. CNOB Englewood Cliffs, NJ $4,263 162% OceanFi
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