Fs Bancorp, Inc. · NASDAQ:FSBW
Fs Bancorp — IPO Roadshow (September 2017)
29 slides from Fs Bancorp's IPO roadshow presentation, Sep 5, 2017
Slide 1: Investor Presentation: Common Equity Offering September 2017
Filed Pursuant to Rule 433 Issuer Free Writing Prospectus Dated September 5, 2017 Relating to the Preliminary Prospectus Supplement Dated September 5, 2017 Registration Statement No. 333-215810 1 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 INVESTOR PRESENTATION Common Equity Offering Septem
Slide 2: Safe Harbor Statement
2 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 Safe Harbor Statement Certain matters discussed in this presentation may contain forward - looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 . Forward - looking statements are not statements of histori
Slide 3: Offering Summary
3 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 ▪ Issuer : ▪ Security : ▪ Base Deal Value : ▪ Overallotment : ▪ Last Trade: ▪ Pre - Offering Mkt Cap: ▪ Current Shares Outstanding : ▪ Use of Proceeds : ▪ Lock - up Agreement : ▪ Manager : ▪ Co - Managers: FS Bancorp, Inc. (NASDAQ: FSBW) Common
Slide 4: Franchise Overview
▪ Total Assets: ▪ Headquartered: ▪ Branches: ▪ ATM Locations: ▪ Year Established: ▪ Quarterly Dividend: $928.6 million (at 6/30/2017) Mountlake Terrace, WA 12 (Including headquarters) 13 1936 $0.11 FRANCHISE OVERVIEW 4
Slide 5: Executive Management
5 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 Matthew Mullet Joseph Adams Donn Costa Dennis O’Leary EXECUTIVE MANAGEMENT Debbie Steck Kelli Nielsen Robert Fuller Drew Ness Chief Executive Officer Chief Financial Officer Chief Lending Officer EVP, Home Lending Chief Credit Officer Chief Oper
Slide 6: Culture & History
Paid eighteenth quarterly cash dividend payment on August 24, 2017 CULTURE & HISTORY Founded in 1936 as a credit union Converted to a state chartered mutual savings bank on April 1, 2004 Converted to a stock savings bank on July 9, 2012 1936 2004 2012 2017 2016 Employ smart, driven, and n ice people
Slide 7: Vibrant Banking Markets
7 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 Puget Aggregate State of Aggregate Sound Franchise Washington National FSBW Branch Information Number of Offices 7 12 12 12 Market Deposits ($000s) 459,114 671,641 671,641 671,641 Population Total Pop. (#) 3,807,891 4,178,259 7,311,903 325,139,2
Slide 8: Largest Snohomish County Bank
8 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 LARGEST SNOHOMISH COUNTY BANK $4.1B * $1.6B * $520M * $350M * $243M $207M * $185M * $149M $123M $45M * $1.3B * $255M $206M $133M $929M $738M $234M $258M $217M $195M Banks Headquartered in Snohomish County: 12/31/2008 Banks Headquartered in Snoho
Slide 9: Branch Acquisition
Strategic Rationale & Purchase Summary Financial Impact Additional Considerations Additional Considerations ▪ Attractive low cost core funding ▪ Expanded branch network (including ATMs) along the Olympic Peninsula ▪ 1st Security Bank assumed all staff from the branches acquired from Bank of America
Slide 10: Strategic Plan Since Conversion
x Expansion of commercial business lending program x Increase in - house originations of residential mortgage loans which are primarily sold into the secondary market through the mortgage banking platform and commercial real estate lending x Maintaining and improving asset quality x Emphasize lower
Slide 11: Financial Performance
11 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 FINANCIAL PERFORMANCE
Slide 12: Financial Highlights for Q2 2017
12 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 ▪ Currently, all Bank Holding Company (BHC) and bank ratios are above those to be considered “Well - Capitalized” ▪ BHC ratios become applicable at $1 billion in assets Financial Highlights for Q2 2017 ▪ Total assets of $928.6 million ▪ Gross l
Slide 13: Franchise Growth
13 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 $359 $419 $510 $678 $828 $878 $929 2012 2013 2014 2015 2016 Q1 '17 Q2 '17 Total Assets ($M) ▪ G ained access to the Olympic Peninsula market through our branch acquisition which provided deposit fuel for lending growth ▪ Ability to expand comme
Slide 14: Loan Portfolio Summary
14 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 $289 $297 $419 $555 $656 $668 $777 7.27% 7.00% 6.67% 6.20% 5.78% 5.85% 5.79% 2012 2013 2014 2015 2016 Q1 '17 Q2 '17 Commercial 8% Construction and development 17% Home equity 3% One - to - four - family (excludes loans held for sale) 22% Multi
Slide 15: Consumer Lending
15 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 Q2 2017 Dealer Production by State Q2 2017 Highlights Total RE 55% Total Consumer 27% Total Commercial 18% CONSUMER LENDING 2009 vs. Q2 2017 Portfolio Credit Quality Portfolio Characteristics Washington 36% Oregon 36% California 22% Idaho 6% In
Slide 16: Home Lending
16 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 $131.6 $195.5 $165.4 $127.4 $138.0 $211.9 $232.9 $187.8 $142.6 $216.8 2.45% 2.73% 2.57% 2.46% 2.35% 2.51% 2.53% 2.95% 2.98% 2.32% Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 ▪ Loan Sales : $171.0 million ▪ 1
Slide 17: Commercial Business Lending
17 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 Mtg. WH $14,288 11% Const. WH $24,877 19% Other C&I Loans $92,713 70% ▪ Commercial and Industrial commitments were $ 227 million ▪ Outstanding balances were $131.9 million relative to $93.6 million at 3/31/2017 ▪ $16.5 million of quarter over s
Slide 18: Commercial Business: Warehouse Lending
18 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 COMMERCIAL BUSINESS: WAREHOUSE LENDING $24.5 $29.2 $31.4 $38.9 $26.8 $22.8 $10.0 $4.0 $10.0 $12.8 $6.5 $10.1 $16.7 $14.8 $13.3 $5.4 $10.6 $10.7 $20.2 $7.8 $3.5 $14.3 $0.0 $0.0 $0.0 $0.0 $0.0 $0.6 $1.5 $2.6 $2.1 $7.1 $11.6 $12.2 $5.7 $4.9 $12.0
Slide 19: Construction & Development Lending
19 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 CONSTRUCTION & DEVELOPMENT LENDING $15.0 $18.5 $24.5 $31.9 $39.1 $43.2 $43.1 $41.6 $39.4 $40.7 $51.4 $57.8 $70.6 $63.6 $78.0 $80.8 $76.7 $76.9 $90.5 $94.8 $104.9 $119.7 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2
Slide 20: Asset Quality Improvement
20 $4.1 $3.2 $0.4 $1.0 $0.7 $0.8 $0.8 1.13% 0.77% 0.08% 0.15% 0.09% 0.09% 0.08% 2012 2013 2014 2015 2016 Q1 '17 Q2 '17 Net Charge - offs (Recoveries) / Average Loans Nonperforming Assets ($M) ASSET QUALITY IMPROVEMENT (1) Non - performing assets consists of non - performing loans (which include non
Slide 21: Deposit Composition and Growth
21 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 $289 $337 $420 $485 $713 $758 $786 0.82% 0.64% 0.66% 0.69% 0.48% 0.48% 0.47% 2012 2013 2014 2015 2016 Q1 '17 Q2 '17 Noninterest - bearing checking 21% Interest - bearing checking 12% MMDA and Savings 43% Certificates of deposits over $250,000 3
Slide 22: Positive Income Statement Trends
22 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 Total Revenues ($M) Net Income to Common ($M) Total RE 55% Total Consumer 27% Total Commercial 18% POSITIVE INCOME STATEMENT TRENDS Total Expenses ($M ) (2) (1) Includes DTA provision reversal of $2.3M (2) Non - Interest expenses are net of one
Slide 23: Selected Performance Ratio Trends
23 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 ROAE ROAA Total RE 55% Total Consumer 27% Total Commercial 18% SELECTED PERFORMANCE RATIO TRENDS Efficiency Ratio Net Interest Margin (1) (1) Net interest margin on a tax equivalent basis (2) Quarterly data is annualized 1.64% 1.01% 1.00% 1.52%
Slide 24: Building Stockholder Value
24 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 Reported Tangible Book Value Per Share (1) Diluted Earnings Per Share Total RE 55% Total Consumer 27% Total Commercial 18% BUILDING STOCKHOLDER VALUE $1.76 $1.29 $1.52 $2.93 $3.51 $0.85 $1.41 2012 2013 2014 2015 2016 Q1 '17 Q2 '17 $19.92 $20.55
Slide 25: Capital Strategy
Organic Growth Dividends Additional Considerations Shareholder Value ▪ Continue organic asset growth across our diverse group of lending channels ▪ Expand commercial business lending including construction lending in - line with regulatory guidance for oversight on construction concentrations above
Slide 26: Investment Highlights
26 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 ▪ Seasoned management team with deep local market knowledge ▪ Robust, diversified growth in consumer, commercial, and real estate lending ▪ Stable core deposit growth ▪ Strong profitability metrics ▪ Excellent credit quality ▪ Attractive core b
Slide 27: Contact Information
27 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 Matthew D. Mullet mattm@fsbwa.com Chief Financial Officer (425) 697 - 8026 Dennis O’Leary denniso@fsbwa.com Chief Lending Officer (425) 697 - 8076 CONTACT INFORMATION Administrative Center 6920 220 th Street Southwest Mountlake Terrace, Washing
Slide 28: Appendix
28 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 APPENDIX
Slide 29: Reconciliation of GAAP to Non-GAAP Financial Measures
29 23,55,94 146,208,80 127,127,127 79,129,179 189,78,76 RECONCILIATION OF GAAP TO NON - GAAP FINANCIAL MEASURES ($ in 000's) June 30, 2017 March 31, 2017 December 31, 2016 Stockholders' equity 88,824$ 83,964$ 81,033$ Goodwill and core deposit intangible, net (3,829) (3,929) 4,029 Tangible common sto