Northwest Bancshares, Inc. · NASDAQ:NWBI
Northwest Bancshares — Merger or Acquisition (April 2015)
40 slides from Northwest Bancshares's merger presentation, Apr 15, 2015
Slide 1: Northwest
{J Northwest
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements, which can be identified by the use of words such as “estimate,” “project,” “believe,” “intend,” “anticipate,” “plan,” “seek,” “expect” and words of similar meaning. These forward-looking statements include, but are not
Slide 3: Attractive Franchise
Attractive Franchise 3
Slide 4: Corporate Profile and Overview
Corporate Profile and Overview 162 retail banking locations 51 consumer finance locations ($107.2 mil in assets, $1.9 mil in net income for year ended 12/31/14) 2,042 full-time equivalent employees (1,863 full-time and 357 part-time employees) Total assets of $7.78 billion Net loans of $5.92 billion
Slide 5: Historic Performance
Historic Performance
Slide 6: Loan Growth and Mix
Loan Growth and Mix $7,000,000,000 $6,000,000,000 $5,000,000,000 $4,000,000,000 $3,000,000,000 $2,000,000,000 $1,000,000,000 $0 = 1-4 Family Residential Mortgages me Equity Loans = Consumer Loans mmercial Real Estate = Commercial and Industrial
Slide 7: Deposit Growth and Mix
Deposit Growth and Mix $7,000,000,000 $6,000,000,000 $5,000,000,000 $4,000,000,000 $3,000,000,000 $2,000,000,000 $1,000,000,000 $- = Savings Accounts = Money Market Accounts on oo oo aa ™ Checking Accounts = Certificates of Deposit
Slide 8: Earnings Per Share
Earnings Per Share (Adjusted for Stock Splits and 2.25x Second-step Conversion) 8
Slide 9: Price Performance Since IPO
Price Performance Since IPO 10 Comparison of cumulative total return since IPO in 1994 Among Northwest Bancshares, Inc., the NASDAQ Composite Index and the NASDAQ Bank Index
Slide 10: 5-Year Price Performance
5-Year Price Performance 11 Comparison of cumulative total return FOR THE LAST FIVE YEARS Among Northwest Bancshares, Inc., the NASDAQ Composite Index and the NASDAQ Bank Index
Slide 11: Highlights for 2014
Highlights for 2014
Slide 12: Highlights for 2014: Enhancement of Shareholder Value
Highlights for 2014 Enhancement of Shareholder Value Paid special dividends of $1.10 for an approximate yield of 8.5%. Paid regular dividends of $.52 for an approximate yield of 4.0%. Repurchased 424,000 shares at an average price of $12.45. 13
Slide 13: Highlights for 2014: Meeting Regulatory Expectations
Highlights for 2014 Meeting Regulatory Expectations Continued to strengthen compliance management system by adding additional personnel. Completed implementation of new software to address the requirements of the Bank Secrecy Act. Increased staffing to handle increased volume of “alerts.” Feel we ha
Slide 14: Recognition for 2014
Recognition for 2014 For the third time since 2009, we were named to a Forbes list for trustworthiness as “One of America’s 50 Most Trustworthy Financial Institutions” (One of only 25 banks on the list). For the fourth time in five years, we were recognized by J.D. Power as “Highest Customer Satisfa
Slide 15: Overview of Companies
Overview of Companies Northwest LNB Assets $7,826,926,000 $1,241,099,000 Loans $6,054,866,000 $922,514,000 Deposits $5,707,723,000 $1,056,784,000 Common Equity $1,076,721,000 $113,065,000 Intangibles $179,533,000 $21,938,000 Market Capitalization $1.174 billion $167 million Last Market Close $12.37
Slide 16: Transaction Highlights
Transaction Highlights Consideration: 1.461 shares of NWBI stock or $18.70 in cash Elections subject to 50% of outstanding LNBB shares being exchanged for NWBI stock One member of LNBB Board of Directors to join NWBI Board Expected EPS accretion of approximately $0.12 in 2016 (first full year of com
Slide 17: LNB – An Attractive Franchise
LNB – An attractive Franchise Northwest targets acquisitions that add franchise value as well as shareholder value.
Slide 18: An Attractive Deposit Mix
An Attractive Deposit Mix Northwest (deposits in millions) % of Total Non-interest Checking 884.8 15.5% Interest Checking 895.3 15.7% Savings 1,214.3 21.3% Money Market 1,180.5 20.7% Time 1,532.8 26.8% 5,707.7 100% Cost of Deposits 0.44% Northwest’s and LNB’s deposit mixes are quite similar with a s
Slide 19: A Diversified Loan Mix
A Diversified Loan Mix A diverse, high-quality loan portfolio provides additional balance to Northwest’s current portfolio mix. Our combined entity can capitalize on Northwest’s mortgage and home equity expertise in the Cleveland market and on LNB’s consumer lending expertise across Northwest’s vast
Slide 20: Exceptional Market Potential
Exceptional Market Potential LNB was most likely our last opportunity to acquire a bank with assets > $1 billion in the Cleveland market. With the addition of LNB, Northwest’s Ohio Region will be the second largest of our eight geographic regions. The Cleveland MSA has a diversified employment base
Slide 21: An Attractive Branch Network
An Attractive Branch Network 23 Northwest LNB Branches 164 20 Deposits $5,707,723,000 $1,056,784,000 Deposits/Branch $34,803,000 $52,839,000 Excluding Retirement Village Branches Branches 16 Deposits $1,042,085,000 Deposits/Branch $65,130,000 Ten of LNB’s non-retirement village branches have over $5
Slide 22: Access to New Customers
Access to New Customers 24 Northwest LNB Combined Number of Households 294,629 44,280 338,909 Number of Customers 537,500 66,420 603,920 Number of Accounts 1,206,540 122,000 1,328,540 A strategic challenge of the banking industry is expanding our existing customer base. The merger with LNB brings No
Slide 23: Management Team Realignment
Management Team Realignment August 22, 2014
Slide 24: Issues Critical to Our Long-Term Success
Issues Critical to Our Long-Term Success Growth Strong and sustainable internal growth fueled by a highly effective and efficient business development process. The acquisition of other banks and financial services companies at a price that is attractive to our shareholders. Efficiency Greater effici
Slide 25: Areas of Responsibility
Areas of Responsibility Region Presidents and Office Network Commercial Lending Wealth Management Retirement Services Insurance Marketing Sales Areas of Responsibility Credit Human Resources Risk Management Legal/Compliance Audit Areas of Responsibility Operations & Delivery Channels Info Technology
Slide 26: Division Update: Production and Revenue Enhancement Division
Division Update Production and Revenue Enhancement Division Steven G. Fisher, Chief Revenue Officer 28
Slide 27: Production and Revenue Enhancement Division Charge
Division Charge “Utilizing highly-effective sales processes to enhance customer procurement, deepen customer relationships and promote revenue growth.” Areas of Responsibility Region Presidents and Office Network Commercial Lending Wealth Management Retirement Services Insurance Marketing Sales Seni
Slide 28: Production and Revenue Team Key Strategies
Production and Revenue Team Key Strategies Refresh and Evolve the Northwest Brand Position and promote Northwest as a full-service financial institution, focusing on core banking, as well as non-traditional products and services (Investment Management, Insurance and Employee Benefits) to broaden per
Slide 29: Production and Revenue Team Key Strategies
Production and Revenue Team Key Strategies Develop Highly Skilled workforce to Compete in a Challenging Landscape Align the right level of talent within our business development model (sales culture) to compete in the marketplace and increase revenue Rationalize and Optimize the Branch Channel Adapt
Slide 30: Production and Revenue Division Highlights
Production and Revenue Division Highlights Commercial Lending Team Generated $150,000,000 in Gross Commercial Loan Production Assets Under Management Now Exceeds $2 billion Insurance Revenue Increased 17.4% Retirement and Investment Services Revenue Increased 12.7% Acquired Evans Capital Management
Slide 31: Division Update: Technology, Operations, Finance and Support Division
Division Update Technology, Operations, Finance and Support Division William W. Harvey, Jr., Chief Financial Officer 33
Slide 32: Technology, Operations, Finance and Support Division
Senior EVP William Harvey Chief Financial Officer Technology, Operations, Finance and Support Division Division Charge “Providing reliable support to all areas of our company while utilizing technology and streamlined processes to drive efficiency in all areas of our operations.” Areas of Responsibi
Slide 33: Increase Profitability Through Expansion of Wholesale Lending
Increase Profitability Through the Expansion of our Wholesale Lending Functions Increase the reach of our mortgage broker relationships to Buffalo, Rochester, Cleveland and Eastern Pennsylvania. Grow our portfolio of indirect financing to include auto loans, off-roads vehicles, recreational vehicles
Slide 34: Contain Costs Through Centralization of Processes
Contain Costs and Improve Delivery Through the Centralization of Processes Created a specific department to focus on process improvement, workflow automation and project management. “Virtual” mortgage and home equity loan function focusing on paperless, straight-through processing. More disciplined
Slide 35: Enhance Customer Delivery Channels Through Technology
Enhance Customer Delivery Channels and Reduce Operating Expenses Through the Use of Technology Launched mobile deposit platform in July, 2014 Launched “live-chat” feature giving customers live access to a Northwest representative through our website Upgraded self-service voice response to provide a
Slide 36: Measurement, Accountability and Discipline
Measurement, Accountability and Discipline Enhanced budget process providing for more accountability Expanded profitability reporting for transparent performance measurement Updated internal reporting portal for delivery of key performance indicators Production and referral tracking tool for sales a
Slide 37: 2014 Financial Performance
2014 Financial Performance
Slide 38: Balance Sheet
Balance Sheet (Assets, Liabilities, Shareholders’ Equity) Loans increased $183.6 million, or 3.2%. Deposits decreased by $36.3 million, or .64%. Checking accounts increased by 6,737, or 2.6%, while checking account balances increased by $124 million, or 7.5%. Shareholders’ equity decreased by $94.2
Slide 39: Income Statement (Earnings and Shareholder Returns)
12/31/2014 12/31/2013 12/31/2012 Amount ($ 000's) % Avg Assets Amount ($ 000's) % Avg Assets Amount ($ 000's) % Avg Assets A Net Interest Income $247,031 3.13% $251,564 3.17% $262,543 3.28% B Provision for Loan Losses ($20,314) (0.26%) ($18,519) (0.23%) ($26,338) (0.33% ) C Noninterest Income $72,57
Slide 40: Asset Quality
Asset Quality Nonperforming assets decreased by $29.3 million, or 23.2%, to $96.8 million, or just 1.25% of assets. Loans 90 days or more delinquent decreased to $41.3 million, or.70% of loans as of December 31, 2014, the lowest level since 2008. Net loan charge-offs in 2014 were $24.1 million, or .
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