Stifel Financial Corporation · NYSE:SF
Stifel Financial — Wells Fargo Securities Asset Managers, Brokers & Exchange Forum 2017
37 slides from Stifel Financial's conference presentation, Mar 21, 2017
Slide 1: Investor Presentation
Investor Presentation Wells Fargo Securities Asset Managers, Brokers & Exchange Forum March 21, 2017
Slide 2: Disclaimer
Disclaimer Forward-Looking Statements This presentation may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 that involve significant risks, assumptions, and uncertainties, including statements relating to the market opportunity and futu
Slide 3: Our Strategy
Our Strate STIFEL
Slide 4: Strategic Vision
Strategic Vision To build a premier wealth management and investment banking firm Global Wealth Management Institutional Private Asset Bank Equities Fixed Investment Research Client Management Sales + Income Banking Trading Sales + Trading 2,282 financial $27B in total $13B in assets Experienced Com
Slide 5: A History of Growth
A History of Growth 2015 2016 2017 Barclays Wealth & Investment Eaton Partners City Securities Management, ISM Capital Sterne Agee, 2014 Sidoti Joint Venture, De La Rosa, Leumi Partners Collaboration Oriel Securities, Agreement 1919 Investment Counsel, Merchant Capital 2013 Acacia Bank & Ziegler 201
Slide 6: Driving Shareholder Value Through Deal Integration & Balance Sheet Growth
Driving Shareholder Value Through Deal Integration & Balance Sheet Growth 6
Slide 7: Balance Sheet Growth
Balance Sheet Growth Infrastructure Build Ratio 2008 2009 2010 2011 2012 2013 2014 3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 4Q17E Tier 1 Leverage 32.3% 30.5% 25.6% 21.4% 17.7% 15.4% 16.5% 16.4% 16.6% 11.6% 11.5% 11.8% 10.2% 10.0% Tier 1 Risk Based Capital 49.4% 40.5% 29.1% 27.4% 26.8% 26.7% 25.0% 29.4% 26.3% 2
Slide 8: Bank Drove Significant Balance Sheet & Revenue Growth
Bank Drove Significant Balance Sheet & Revenue Growth Impact of Bank Growth LTM on Consolidated Results Bank growth has been balanced between loans and investments: (mil.) 12/31/2015 12/31/2016 Loans: Total consolidated assets $13,326 $19,129 • Comprised of securities based loans, C&I, and Investmen
Slide 9: Balance Sheet Comparison
Balance Sheet Comparison Source: SNL Financial (1) Excludes loans held for sale 9
Slide 10: Stifel Overview
Stifel Overvie STIFEL 10
Slide 11: Stifel – Premier Investment Bank and Wealth Management Firm
Stifel – Premier Investment Bank and Wealth Management Firm Stifel at a Glance GAAP Net Revenue - $2.6 billion Global Wealth Management (GWM) Institutional Group (IG) Net Revenue - $1.6 billion Net Revenue - $1.0 billion Private Client Equity & Fixed Income Capital Raising Stifel Bank & Trust
Slide 12: Leading broker-dealer providing wealth management and institutional services
Leading broker-dealer providing wealth management and institutional services to consumers and companies Bulge Bracket Boutique Size / scale Firm focus Large distribution Good research Size / scale Trading Growth investor access Firm focus Retail Issues Stability (financial & pers
Slide 13: Well-diversified, Low Risk Business Model with Balanced Retail and Institutional Exposure
Well-diversified, Low Risk Business Model with Balanced Retail and Institutional Exposure Unburdened by capital constraints Low leverage business model and conservative risk management Limited balance sheet risk Stable wealth management business is augmented by profitable and growing institu
Slide 14: A Stable Track Record Through Multiple Business Cycles
A Stable Track Record Through Multiple Business Cycles Non-GAAP Net Revenues ($MM) Total Equity ($MM) Total Client Assets(1) ($BN) Book Value Per Share(2) (1) Excludes impact of sale of Sterne Agee Independent Contractor & Correspondent Clearing businesses (2) Book Value Per Share adjusted for April
Slide 15: Global Wealth Management
Global Wealth Management STIFEL
Slide 16: Global Wealth Management (GWM)
Global Wealth Management (GWM) Provides Securities Brokerage Services and Stifel Bank Products Overview National Presence Grown from 600+ financial advisors in 2005 to approximately 2,300 financial advisors currently Proven organic growth and acquirer of private client business Strategy of rec
Slide 17: Building Scale and Capabilities into a $1.6B Revenue Segment
Building Scale and Capabilities into a $1.6B Revenue Segment ~100 advisors managing over $20B in AUM December 2015 ~130 advisors managing ~ $10B in AUM June 2015 Customized investment advisory and trust services November 2014 Private Client Private Client – 350 financial advisors and s
Slide 18: GWM - Private Client Group
GWM - Private Client Group Key Operating Metrics Financial Advisors(1) Branches(1) Accounts(1) Total Client Assets(1) ($MM) (1) Excludes Legacy Sterne Agee Independent Contractor Business. 18
Slide 19: GWM – Stifel Bank & Trust
GWM – Stifel Bank & Trust Overview Key Statistics (000s) (4) Acquired FirstService Bank, a St. Louis-based, Missouri- Total assets $12,798,000 chartered commercial bank, in April 2007 Total deposits 11,527,000 Stifel Financial became a bank holding company and Total equity 912,000 financial serv
Slide 20: Growing Asset Management Capabilities
Growing Asset Management Capabilities Asset Management Subsidiaries with $26.9¹ Billion in Client Assets ¹Stifel affiliated asset managers excludes $1.2 billion in AUM from Sagewood Asset Management, which was spun off to management on January 1, 2017 EquityCompass Strategies is a research and inves
Slide 21: Institutional Group
Institutional Group 21
Slide 22: Institutional Group
Institutional Group Overview Net Revenues ($MM)(2)(3) Provides securities brokerage, trading, research, underwriting and corporate advisory services Largest provider of U.S. Equity Research 2nd largest Equity trading platform in the U.S. outside of the Bulge Bracket(1) Full-service Investmen
Slide 23: Building Scale and Capabilities into a $1.0B Revenue Segment
Building Scale and Capabilities into a $1.0B Revenue Segment Growth Focused Investment Banking, Research, Sales and Trading July 2010 Core of our Institutional sales, trading and research group December 2005 Enhances European debt capital markets capabilities February 2016 Equities Hig
Slide 24: Institutional Group – Investment Banking
Institutional Group – Investment Banking Accomplished U.S. Equity Underwriting Franchise – All Equity Transactions All Managed Equity Deals Since 2010 Bookrun Equity Deals Since 2010 ($ in billions) # of $ ($ in billions) # of $ Rank Firm Deals Volume Rank Firm Deals Volume 1 JPMorgan 1,522 $850.9 1
Slide 25: Institutional Group – Research
Institutional Group – Research Largest U.S. Equity Research Platform U.S. Equity Research Coverage (1) Stifel Research Highlights Com panies Under Cover age Rank Fir m Ov er al l Mid Cap Sm al l Cap Largest provider of U.S. Equity Research 1 Stifel / KB W 1 ,2 7 3 451 3 72 Largest provider of U.
Slide 26: Institutional Group – Equity Sales and Trading
Institutional Group – Equity Sales and Trading Powerful Platform Spanning North America and Europe Institutional Equity Sales Equity Trading 80 person sales force, commission-based 28 sales traders located in Experts in small and mid cap growth and value Baltimore, New York, Boston, Dallas,
Slide 27: Institutional Group – Fixed Income Capital Markets
Institutional Group – Fixed Income Capital Markets Strong Fixed Income Brokerage Capabilities Overview Client Distribution (1)(2) Comprehensive platform Insurance Trust Company 1% Other 2% Broker/Dealer 125 traders with annual client trade volume approaching Company 7% 7% Corporation 1% $500 bil
Slide 28: Institutional Group – Public Finance
Institutional Group – Public Finance Overview Stifel has ranked in the top ten nationally Specialty sectors: for senior managed negotiated Education underwritings for the past five years, and Stifel has ranked #1 nationally for senior Local Government/Municipal managed K-12 negotiated underw
Slide 29: Financial Information
Financial Information STIFEL 29
Slide 30: 4th Quarter Highlights
4th Quarter Highlights Financial Highlights Three Months Ended Non-GAAP (000s, except per share data) 4Q16 4Q15 3Q16 4Q16 U.S. GAAP Net revenues $661,391 $581,286 $641,986 $661,392 Compensation ratio 63.6% 68.6% 67.6% 62.3% Non-compensation ratio 28.1% 29.5% 28.0% 24.2% Pre-tax operating margin 8.3%
Slide 31: Brokerage & Investment Banking Revenue
Brokerage & Investment Banking Revenue Brokerage: Three Months Ended (000s) 4Q16 4Q15 % Change 3Q16 % Change Global Wealth Management brokerage revenue $160,017 $166,339 -3.8% $165,475 -3.3% Institutional brokerage: Equity 64,007 54,837 16.7% 51,004 25.5% Fixed income 65,712 73,574 -10.7% 71,794 -8.
Slide 32: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Three months ended December 31, 2016 Three months GAAP to Non-GAAP Reconciliation for Fourth Quarter 2016 GAAP Results ended (000s) 12/31/16 (000s) 12/31/16 GAAP Net Income $26,880 Total GAAP Compensation & benefits expense $420,664 Preferred Dividend 2,343 GAAP comp.
Slide 33: Balance Sheet & Net Interest Margin
Balance Sheet & Net Interest Margin Net Interest Income Drivers: • Total assets increased to $19.1 bil. up 11% sequentially & 44% Y/Y • Average interest earning assets increased to $15.6 bil. up 27% sequentially & 111% Y/Y • NIM increased to 191 bps , up 10 bps sequentially but down 5 bps Y/Y. • NIM
Slide 34: Segment Results
Segment Results STIFEL
Slide 35: Global Wealth Management
Global Wealth Management • Net revenue in the GWM segment was $408 mil., up 5% sequentially & 17% Y/Y • Brokerage revenue declined 3% sequentially & 4% Y/Y • Ex. Sterne IBC & Clearing, Brokerage revenue increased 6% sequentially • Net interest income increased 23% sequentially & 87% Y/Y • 2,282 tota
Slide 36: Stifel Bank & Trust
Stifel Bank & Trust Stifel Bank % (mil. except for %'s) 4Q16 4Q15 Change 3Q16 Assets: Investments $6,209 $3,479 79% $5,377 Mortgage Loans 2,161 429 404% 1,804 Commercial Loans 1,710 1,217 41% 1,558 Securities Based Loans 1,614 1,389 16% 1,453 Total Loans, net $5,591 $3,144 78% $4,957 Loans Held for
Slide 37: Institutional Group
Institutional Group • Total net revenue of $253 mil. decreased 2% sequentially but increased 3% Y/Y • Investment banking revenue of $122 mil. decreased 8% sequentially & 32% Y/Y • Equity underwriting of $40 mil. increased 88% sequentially & 2% Y/Y • Debt underwriting of $28 mil. increased 9% sequent
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