New Peoples Bankshares, Inc. · OTC:NWPP
New Peoples Bankshares — Shareholder Meeting (June 2015)
43 slides from New Peoples Bankshares's shareholder meeting presentation, Jun 4, 2015
Slide 1: Annual Shareholders' Meeting
Annual Shareholders’ Meeting June 2, 2015 Exhibit 99.1
Slide 2: Introduction of Directors
1 INTRODUCTION OF DIRECTORS • Lynn Keene, Chairman • Charles Gent, Vice-Chairman • Tim Ball • Joe Carter • John Cox • Eugene Hearl • Michael McGlothlin • Fred Meade • Scott White
Slide 3: Introduction of Senior Management Team
2 INTRODUCTION OF SENIOR MANAGEMENT TEAM • Todd Asbury, President and CEO • Frank Sexton, Jr., EVP and COO • Karen Wimmer, EVP and CCO • Joseph Pennington, SVP and CFO • Andy Mullins, FSVP and Senior Retail Officer • Debbie Arrington, SVP - Banking Operations • Tammy Herron, Interim SVP & Senior Com
Slide 4: Our Mission
3 Our Mission The mission of New Peoples Bank is to provide high quality, state of the art, golden rule banking services to our communities, while generating a reasonable return to our stockholders and providing a challenging and rewarding work environment for our family of employees. • We believe i
Slide 5: Cautionary Statement Regarding Forward-Looking Statements
4 Cautionary Statement Regarding Forward-Looking Statements This presentation includes forward-looking statements. These forward-looking statements are based on current expectations that involve risks, uncertainties, and assumptions. Should one or more of these risks or uncertainties materialize or
Slide 6: Year 2014 - A Year of Stabilization and Building a Foundation for the Future
5 2014 - A Year of Stabilization and Building a Foundation for the Future • Major Initiatives • Improved our Capital Position • Streamlined our branching network • Improved/stabilized Asset Quality issues • Nearing full compliance with Written Agreement • Obtained regulatory approval to pay 5 years
Slide 7: Strategic Priorities: Near-Term Priorities (1-2 years)
NEAR-TERM PRIORITIES (1-2 years) Emerge from Operating Agreement Reduce credit risk profile Conservative/modest growth Increase earnings and capital Maximize efficiencies Improve risk management capabilities Continue to recruit, develop and support our people Strategic Priorities
Slide 8: Emerge From Operating Agreement
7 Emerge From Operating Agreement
Slide 9: Emerge From Operating Agreement
8 Emerge From Operating Agreement • Entered a formal Written Agreement with the Federal Reserve and the VA Bureau of Financial Institutions in July 2010 • To date, we have fully complied with nearly all of the requirements. Three are partially in compliance, but we believe we have sufficiently addre
Slide 10: Reduce Credit Risk Profile
9 Reduce Credit Risk Profile
Slide 11: Reduce Credit Risk Profile
10 Reduce Credit Risk Profile • We continue to make steady progress in resolving poor asset quality issues • Nonperforming Assets remain high, but continue decreasing • Our goal is to reduce classified assets at least 25% annually • During 2014, classified assets decreased by $18.4 million, or 30.24
Slide 12: Classified Assets (In thousands)
11 Classified Assets (In thousands) December 31, 2010 through March, 31, 2015 2010 2011 2012 2013 2014 2015 Classified Assets $103,762 $113,393 $76,641 $60,976 $42,538 $40,689 $0 $10,000 $20,000 $30,000 $40,000 $50,000 $60,000 $70,000 $80,000 $90,000 $100,000 $110,000 $120,000 Classified Assets
Slide 13: Nonperforming Assets (In thousands)
12 Nonperforming Assets (In thousands) December 31, 2010 through March 31, 2015 2010 2011 2012 2013 2014 2015 Total NPAs $59,820 $58,912 $47,956 $44,161 $36,910 $35,559 OREO $12,346 $15,092 $13,869 $15,853 $15,049 $14,837 Nonaccrual Loans $45,781 $42,316 $33,536 $28,307 $21,861 $20,722 90 Days + Acc
Slide 14: Delinquency Trends 30+ days (In thousands)
13 Delinquency Trends 30+ days (In thousands) December 31, 2010 through March 31, 2015 2010 2011 2012 2013 2014 2015 90 Days+ $23,404 $24,820 $21,002 $10,702 $4,952 $7,855 60-89 Days $10,110 $6,609 $1,956 $3,625 $2,634 $2,481 30-59 Days $22,426 $24,328 $16,492 $16,370 $11,882 $8,928 $0 $10,000 $20,0
Slide 15: Conservative/Modest Growth
14 Conservative/ Modest Growth
Slide 16: Consolidated Financial Snapshot
Balance Sheet Measures March 31, 2015 December 31, 2014 December 31, 2013 15 Consolidated Financial Snapshot Total Assets $ 660.1 million $ 651.1 million $ 684.7 million Investment Securities available for sale $ 100.1 million $ 100.1 million $ 79.1 million Total Loans $ 449.9 million $ 457.5 millio
Slide 17: Strategic Shrinking Trend (In Millions)
16 Strategic Shrinking Trend (In Millions) December 31, 2010 - March 31, 2015 2010 2011 2012 2013 2014 2015 Total Assets $852.6 $780.4 $719.0 $684.7 $651.1 $660.1 Total Loans $707.8 $597.8 $522.4 $493.0 $457.5 $449.9 Total Deposits $766.1 $708.3 $652.9 $619.0 $585.2 $593.3 $400 $450 $500 $550 $600 $
Slide 18: Increase Earnings/Capital
17 Increase Earnings/ Capital
Slide 19: Consolidated Earnings Snapshot
Earnings 3-Months Ended March 31, 2015 December 31, 2014 December 31, 2013 18 Consolidated Earnings Snapshot Net Income $ 622 thousand $ 240 thousand $ 1.5 million Net Income per Share $ 0.03 $ 0.01 $ 0.07 Net Interest Income $ 5.4 million $ 22.6 million $ 25.3 million Net Interest Margin % 3.74% 3.
Slide 20: Return on Average Assets
19 Return on Average Assets December 31, 2010 through March 31, 2015 -1.05% -1.07% -0.86% 0.21% 0.04% 0.38% -1.25% -1.00% -0.75% -0.50% -0.25% 0.00% 0.25% 0.50% 2010 2011 2012 2013 2014 2015 1st QTR Return on Average Assets
Slide 21: Net Interest Margin Trend
20 Net Interest Margin Trend December 31, 2010 through March 31, 2015 4.35% 4.29% 4.13% 4.03% 3.71% 3.74% 3.76% 3.81% 3.71% 3.61% 3.64% 3.64% 0.00% 1.00% 2.00% 3.00% 4.00% 5.00% 2010 2011 2012 2013 2014 2015 Net Interest Margin Peer Data BHC $500 Million to $1 Billion Peer Data Source: Federal Reser
Slide 22: New Peoples Bankshares Inc
: NEW PEOPLES BANKSHARES INC
Slide 23: 2014 Capital Improvements
22 2014 Capital Improvements • Issued 1,006,361 shares of common stock at $1.75 per share via warrants being exercised, of which the majority was from the Board and Management • Received regulatory approval to pay the deferred interest payments and first quarter 2015 payment on trust preferred secur
Slide 24: Capital Ratios (Bank only)
23 Capital Ratios (Bank only) March 31, 2015 December 31, 2014 December 31, 2013 Improving Our Capital Position Equity to Assets Ratio* 6.64% 6.58% 5.84% Tier 1 Leverage Ratio 8.88% 8.19% 7.49% Tier 1 Risk Based Capital Ratio 15.17% 14.46% 12.69% Total Risk Based Capital Ratio 16.44% 15.73% 13.96% N
Slide 25: Capital Ratio Trend - Tier 1 Leverage Ratio
24 Capital Ratio Trend – Actual Tier 1 Leverage Ratio (Bank Only) December 31, 2010 through March 31, 2015 2010 2011 2012 2013 2014 2015 Leverage Ratio 6.00% 5.99% 7.08% 7.49% 8.19% 8.88% Short Term Goal 7.00% 7.00% 7.00% 7.00% 7.00% 7.00% Long Term Goal 9.00% 9.00% 9.00% 9.00% 9.00% 9.00% 0.00% 2.0
Slide 26: Capital Ratio Trend - Total Risk Based Capital Ratio
25 Capital Ratio Trend – Actual Total Risk Based Capital Ratio (Bank Only) December 31, 2010 through March 31, 2015 2010 2011 2012 2013 2014 2015 RBC Ratio 9.79% 10.56% 12.88% 13.96% 15.73% 16.44% Short Term Goal 12.00% 12.00% 12.00% 12.00% 12.00% 12.00% Long Term Goal 15.00% 15.00% 15.00% 15.00% 15
Slide 27: New Peoples Bankshares Inc
: NEW PEOPLES BANKSHARES INC
Slide 28: Changing Deposit Mix
27 Changing Deposit Mix • We have intentionally worked at shifting the deposit mix to increase non-interest and lower interest deposits and reduce higher cost time deposits • This will help us in the future to be able to better manage our interest expenses when interest rates rise in the future • It
Slide 29: Deposit Mix (In thousands)
28 Deposit Mix (In thousands) December 31, 2010 through March 31, 2015 2010 2011 2012 2013 2014 2015 Non-Int Bearing $87,839 $109,629 $98,432 $137,745 $143,950 $152,814 Int Bearing DDAs, Savings $168,141 $153,028 $181,945 $134,261 $141,268 $149,113 Time Deposits $510,100 $445,658 $372,473 $346,991 $
Slide 30: Leverage Technology to Improve Efficiencies, Compliance and Customer Service Experience
29 Leverage Technology to Improve Efficiencies, Compliance and Customer Service Experience • In late 2014, we made decisions to utilize technology to a greater extent to improve efficiency • In 2015, we are: • Creating a customer contact center for more responsive, more efficient customer service •
Slide 31: Optimizing Branch Productivity and Efficiencies
30 Optimizing Branch Productivity and Efficiencies • Consolidated the following four branches in the 4 th quarter of 2014: • Bland, VA • Norton, VA • Jonesville, VA • Bluewell, WV • Reduced total full-time-equivalent employees by 21 or 7.95%, in 2014 to 243 • Reduced salary and employee benefits exp
Slide 32: Improve Risk Management Capabilities
31 Improve Risk Management Capabilities
Slide 33: Improve Risk Management Capabilities
32 Improve Risk Management Capabilities • In the past few years, we have implemented Enterprise Risk Management Practices • The key areas of risk that we monitor and manage are: • Credit • Interest Rate • Liquidity • Price • Operational • Compliance/ Legal • Strategic • Reputation • We utilize this
Slide 34: Continue to Recruit, Develop and Support Our People
33 Continue to Recruit, Develop and Support Our People * * * * * * * *
Slide 35: Continue to Recruit, Develop and Support Our People
34 Continue to Recruit, Develop and Support Our People • 243 full-time-equivalent employees at year end • We are working on the following things to accomplish this goal • Continue to further develop a management development program • Recruit talented commercial lenders, credit management, insurance
Slide 36: New Peoples Bankshares Inc
: NEW PEOPLES BANKSHARES INC
Slide 37: Strategic Priorities: Long-Term Priorities (2-5 years)
LONG-TERM PRIORITIES (2-5 years) Enhance shareholder liquidity, value and return Differentiate ourselves from the competition through superior service and our local market presence Continue targeted growth in clearly defined segments Expand on building a growing portfolio of low cost relationship-ba
Slide 38: Financial Goals 2015-2017
Financial Goals 2015-2017 2015 2016 2017 Financial Assets $635M $650M $668M Asset Growth -3.24% 2.37% 2.82% Loan Growth -0.58% 1.33% 3.23% Deposit Growth -4.01% 2.22% 2.38% Return on Average Assets 0.57% 0.68% 1.01% Return on Average Equity 6.14% 6.88% 9.84 % Net Interest Margin >3.85% >3.90% >4.00%
Slide 39: First Quarter-2015
38 FIRST QUARTER-2015 • Net income of $622 thousand, or $.03 per share • Total assets grew $9.0 million to $660.1 million • Total non-maturity deposits grew $16.7 million while time deposits decreased $8.6 million • Total equity was $43.9 million at quarter end • The Company is considered well-capit
Slide 40: For You the Shareholder
39 For You the Shareholder • We are working to make New Peoples Bankshares a high performing financial institution • We desire to enhance profitability in the next 5 years to recover the $17.0 million in retained deficit of losses so we may pay a cash dividend • We will strive to make your investmen
Slide 41: Summary
40 Summary 2014 was a year of improvements A profitable year, albeit a nominal profit Capital ratios improved across the board Asset Quality is improving and showing positive trends (no provisions take in 2015) The bank is substantially compliant with the Written Agreement The Company’s balance shee
Slide 42: New Peoples Bankshares Inc
: NEW PEOPLES BANKSHARES INC
Slide 43: New Peoples Bankshares Inc
: NEW PEOPLES BANKSHARES INC
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