Highlands Bankshares, Inc. · OTC:HBSI
Highlands Bankshares — 11th Annual FIG Partners Bank CEO Forum 2015
19 slides from Highlands Bankshares's conference presentation, Sep 29, 2015
Slide 1: Highlands Bankshares, Inc. (OTC Pink: HBKA)
Highlands Bankshares, Inc. (OTC Pink: HBKA) Highlands Union Bank . 11th Annual FIG Partners Bank CEO Forum | September 28 - 29, 2015 |
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including statements relating to financial and operational performance and certain plans, expect
Slide 3: Diversified Branch Network
Diversified Branch Network » 14 branches serving Southwest Virginia, Eastern Tennessee and Western North Carolina » Highlights of economic drivers include manufacturing, tourism, agriculture and education. Union Bank
Slide 4: Capital Update
Capital Update » Recapitalized and Repositioned » Highlands Bankshares, Inc. completed a $16.53 million private placement and rights offering in April 2014 » Repaid $3.44 million loan to CBB Financial Corp's Community Bankers’ Bank. >» Repaid remaining $3.15 million of its trust preferred securities
Slide 5: Investment Considerations, as of 6/30/15
Investment Considerations, as of 6/30/15 Operating efficiencies gaining traction Continued improvements in asset quality ashington, “Baltimore Produced six consecutive quarters of profitability wr a A oma Investment securities grew 51% year-over-year, ¥ contributing to margin expansion Generated 2%
Slide 6: Company History
Company History Z § a & a g 4 Thitd stock Becbnd completed iat Stockisque S24/share Eomipleted at$}T/share {00% stock 25% | Dividend Initial Stock Biel t Paid) issued at wR | shy Pad S1ishare ai el 20% Stock fofrmed Divideha HU Bank Chalteres 100% Stock Divitend 100% stock Dividend Paid Raped ‘18am
Slide 7: Net Income
Net Income o 3 < i o 3 o ed = $3,000 $2,000 $1,000 $- $(1,000) $(2,000) $(3,000) $(4,000) $(,000) $(6,000) $(7,000) = Consolidated Earnings $2,526 $2,022 - $1,482 —_ $1,714 —_ mame — 3011 12/312012 12/31 2013 12/31 2014 6/30/2015 $(2,123) 2011 -- Established $4 million valuation allowance for its DT
Slide 8: Stable Net Interest Margin
Stable Net Interest Margin 12/31 2011 12/31 2012 12/31 2013 12/31 2014 1H 2015
Slide 9: Unemployment 5.3% in July 2015
Unemployment 5.3% in July 2015 Corporate tax rate at 6% -- unchanged since 1972 Business friendly state * Ranked highly by CNBC and Forbes.com 4™ Wellmont SS Health System Highlands www. yesvirgina.org Union Bank |
Slide 10: Boone and Banner Elk NC
Boone and Banner Elk NC > Unemployment 5.6% in July 2015 Hospitality Minis > Growing population 45 Samaritan's Purse’ » Economic drivers include tourism, skiing, agriculture, Christmas tree farms, State University and manufacturing http://esesc23.esc.state.nc.us/WorkForcelnDepth/WIDReports.aspx
Slide 11: Knoxville TN
Knoxville TN Unemployment 5.9% in July 2015 Ranked 99" on global growth by the Brooking Institute in 2014 Knox County 1Q15 business filings increased 21% Highlands http //www. knoxnews.com/business/tennessee-sees-record-number-of-new-business-filings 58997311 Bien |
Slide 12: Great Smoky Mountains National Park Gateways
Great Smoky Mountains National Park Gateways Home of Dolly Parton and her resorts, Dollywood and Dollywood’s Splash Country Tennessee has no state income tax Unemployment was at 5.6% in July 2015 Highlands Union Bank
Slide 13: Strong Deposit Base
Strong Deposit Base = Noninterest-bearing Interest-bearing, DDA, MMDA = Savings Time Deposits > $250K = Time Deposits < $250K Highlands Union Bank |
Slide 14: Diversified Loan Portfolio
Diversified Loan Portfolio 06%, 1% = Residential 1-4 family = Multifamily = Construction and Land Loans = Commercial, Owner Occupied Commercial, Non-owner occupied 2nd Mortgages/Eqty Lines of Credit Farmland = Personal/Commercial/Ag = Overdrafts 0.06% ALL/net deferred fees Highlands Union Bank
Slide 15: Improving Asset Quality
Improving Asset Quality Nonperforming Assets/Total Assets (°0) 3/31 2011 12/31 2012 12/31 2013 12/31 2014 6/30 2015 Highlands Union Bank
Slide 16: Solid Capital
Solid Capital 3/31/2011 12/31/2012 12/31/2013 12/31/2014 6/30/2015, al Risk-Based Capital Tier 1 Capital — Bank ($ in thousands) $ 32,376 34,057 34,975 46,663 44,593** ** BASEL If rules included Highlands Union Bank
Slide 17: Experienced Management Team
Experienced Management Team Samuel L. Neese Robert M. Little, Jr. Jim Edmondson Edward Farmer Brian T. Booher C. Wayne Perry Years at Chief Executive Officer Chief Financial Officer of HBKA CFO of Highlands Union Bank Senior Operations Officer Senior Vice President Senior Vice President Combined Yea
Slide 18: Financial Highlights
Financial Highlights Financial Highlights at June 30, 2015 Total Assets $610.10 million Total Loans $413.94 million Total Deposits $487.20 million Non-interest Bearing Deposits $118.60 million Total Shareholders’ Equity $ 54.10 million TE/Tangible Assets 7.73% Total RBC Ratio - Bank 12.89% © The Ban
Slide 19: Positioned for Growth
Positioned for Growth Highlands Bankshares, Inc. - Price Change (%)
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