Qcr Holdings, Inc. · NASDAQ:QCRH
Qcr — IPO Roadshow (May 2015)
36 slides from Qcr's IPO roadshow presentation, May 4, 2015
Slide 1: Investor Presentation
Filed Pursuant to Rule 433 Registration Statement No. 333-197129 Issuer Free Writing Prospectus Dated May 4, 2015 Relating to Preliminary Prospectus Supplement Dated May 4, 2015 Investor Presentation May 2015
Slide 2: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS This presentationcontains certain 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. These statements include, but are not limited to, descriptions of the financial condition,
Slide 3: Forward-Looking Statements - Continued
FORWARD-LOOKING STATEMENTS - Continued (ix) changes in the prices, values and sales volumes of residential and commercial real estate; (x) the effects of competition from a wide variety of local, regional, national and other providers of financial, investment and insurance services; (xi) the risks o
Slide 4: Non-GAAP Financial Measures
NON-GAAP FINANCIAL MEASURES These slides contain non-GAAP financial measures. For purposes of Regulation G, a non-GAAP financial measure is a numerical measure of the registrant’s historical or future financial performance, financial position or cash flows that excludes amounts, or is subject to adj
Slide 5: Offering Overview
Offering Overview Offering Summary Issuer QCR Holdings, Inc. Listing: Ticker NASDAQ: QCRH Closing Price (1) $18.77 Offering Type Follow-on offering of common stock Shares Offered 2,800,000 Overallotment 15% Repay senior debt and redeem subordinated debt at the parent General corporate purposes, incl
Slide 6: Today's Speakers
Today’s Speakers Douglas M. Hultquist, CPA • Director, President and Chief Executive Officer • Co-founded the company in 1993 • Began career with KPMG Peat Marwick rising to Partner and served as a Tax Partner of McGladrey & Pullen in the Quad Cities from 1991 to 1993 • Specialized in bank taxation,
Slide 7: Corporate Overview
Corporate Overview QCR Holdings, Inc. - Founded in 1993 Headquartered in Moline, IL NASDAQ – QCRH $2.5 Billion in Assets $1.7 Billion in Loans $1.7 Billion in Deposits 13 Facilities Quad City Bank & Trust (5) Cedar Rapids Bank & Trust (2) Rockford Bank & Trust (2) m2 Lease Funds LLC (1) Community Ba
Slide 8: Equity Offering Strategic Highlights
Equity Offering Strategic Highlights • Bolsters capital ratios and brings TCE ratio more in-line with industry peers • Funding restructure significantly improves net interest margin • Shortens the time period to achieve our targeted 1.0% ROAA • Better positions us to continue to identify and cultiva
Slide 9: Investment Rationale
Investment Rationale • $2.5B asset bank holding company with critical mass in attractive and target rich markets in Iowa and Illinois - Top 2 bank with 11% market share in the Quad Cities, Iowa/Illinois and Top 4 in Cedar Rapids, Iowa with 8% share - Quad Cities is the International Headquarters for
Slide 10: Full Service Institution
Full Service Institution Correspondent Banking Wealth Management • Competitively positioned with veteran staff software, • $1.66B in Trust (and related) accounts and $670M systems and processes in Brokerage (and related) accounts • More than 160 relationships to date with total non- • Full range of
Slide 11: QCRH Market Overview
QCRH Market Overview Deposit Market Share Overview ($M) • Meaningful market share position in each Market 2 4 9 10 MSA served, with room for continued Rank growth • Each MSA falls within the top 15 largest MSAs in IL and IA by total deposits • All 4 MSAs are projected to have household income growth
Slide 12: "Capitalizing" on Opportunities in Our Market
“Capitalizing” on Opportunities in Our Market • Leverage renewed capital strength and relationship driven approach to capture greater organic market Distribution of Institutions in Targeted Markets (1) and relationship share • Selectively pursue accretive acquisition opportunities • Operating market
Slide 13: Top MSAs / Iowa and Illinois
Top 25 MSAs / Iowa and Illinois Projected Median Projected Deposits Number of Number of Total Population Household Median HHI MSA ($ M ) Institutions Branches Population Growth Income CAGR Chicago-Naperville-Elgin, IL-IN-WI $354,011 212 2,994 9,570,110 0.23 % $61,244 1.11 % Saint Louis, MO-IL 93,445
Slide 14: Financial Highlights
XXXXXXXXXXX Financial Highlights
Slide 15: Financial Highlights
Financial Highlights (1) 2009 2010 2011 2012 2013 2014 2014Q1 2015Q1 ($ millions except per share) 12/31/09 12/31/10 12/31/11 12/31/12 12/31/13 12/31/14 3/31/14 3/31/15 Balance Sheet Total Assets $1,780 $1,837 $1,967 $2,094 $2,395 $2,525 $2,426 $2,492 Total Loans/Leases 1,244 1,173 1,201 1,287 1,460
Slide 16: Total Consolidated Assets
Total Consolidated Assets CAGR From 1994-2014: 21.26% 16 Source: Company documents. Dollars in millions.
Slide 17: Strong Commercial Loan Growth
Strong Commercial Loan Growth Loan Growth Trend (1) • C&I and Direct Financing Lease balances grew approximately 24% and 30%, respectively from 2013 to 2015Q1 • 13% overall loan growth from 2013 to 2015Q1 represented all organic growth • Commercial lending(2) represents more than 85% of the portfoli
Slide 18: m2 Lease Funds LLC Overview
m2 Lease Funds LLC Overview Lease Asset Generation • National equipment leasing platform • Focus includes commercial equipment and assets, medical equipment, and vehicles classified as heavy equipment • High yield portfolio; average gross yield for Q1 2015 was approximately 8.4% • Historically stron
Slide 19: Asset Quality Overview
Asset Quality Overview Classified Loans ($M) & NPAs / Assets Nonperforming Assets Composition – 2015Q1 • Management continues to focus on maintaining excellent asset quality and resolving problem assets • Potential problem assets in the form of classified loans continued their steady decline in 2015
Slide 20: Evolution of Funding Base
Evolution of Funding Base Average Funding Base - 2010 Average Funding Base – 2015Q1 Noninterest Bearing Noninterest Deposits Bearing Borrowings Borrowings 13.7% Deposits 24.8% 33.4% 25.2% $1,684M $2,324M Interest Interest Bearing Bearing Demand Demand Deposits Time Deposits Deposits 25.3% Time Depos
Slide 21: Funding Restructure Impact
Funding Restructure Impact Estimated • Funding restructuring Q1 2015 3/31/15 Pre-Tax can provide an Weighted ($ millions) Amount Interest Average estimated 13 basis Outstanding Expense Rate Savings(1) points(3) improvement in net interest margin Subordinated Debt $2.7 6.00% $0.2 • Estimated after-ta
Slide 22: Attractive Revenue Mix & Growth Trend
Attractive Revenue Mix & Growth Trend Continued Strong Top Line Revenue Growth Trends ($M) • Strong fee income streams provide stability and complement to spread revenue • Key Differentiators: - Wealth Management ($2.3B in AUM) - Correspondent banking 10.2% Y-o-Y (160+ relationships) Growth - SBA /
Slide 23: Improving Returns for Common Shareholders
Improving Returns for Common Shareholders Net Income to Common Shareholders ($M) Approximately ~54% Net Income to Common CAGR From 2010 – 2014; 31% Growth From 2014Q1 – 2015Q1 23 Source: Company documents. Dollars in millions.
Slide 24: Strategies To Achieve A 1.0% ROAA
Strategies To Achieve A 1.0% ROAA Strategic Initiatives to Achieve 1.0% ROAA • Increase loans and leases to more than 70% of total assets (66% as of 3/31/15) • Continued reductions in wholesale funding to less than 15% of assets (26% as of 3/31/15 (1)) • Increase gain on sale of USDA and SBA loans t
Slide 25: Concluding Remarks
XXXXXXXXXXX Concluding Remarks
Slide 26: Concluding Remarks
Concluding Remarks • Critical mass in attractive and target rich markets in Iowa and Illinois • 3 charter model allows subsidiary banks to customize solutions by market • Differentiated product offering includes correspondent banking, wealth management, leasing and SBA/USDA lending • Strong asset qu
Slide 27: 3551 7th Street, Moline, Illinois
th 3551 7 Street Moline, Illinois 61265 www.qcrh.com
Slide 28: Appendix
OCR HOLDINGS, INC. Appendix
Slide 29: History of QCR Holdings, Inc.
History of QCR Holdings, Inc. 1993 Founded by Mike Bauer and Doug Hultquist - $14 Million IPO 1994 Quad City Bank & Trust (De Novo) – Currently $1.3 Billion in Assets 1995 Quad City Bancard Formed 2001 Cedar Rapids Bank & Trust (De Novo) – Currently $855 Million in Assets (includes Community Bank &
Slide 30: Executive Management Team
Executive Management Team DOUGLAS M. HULTQUIST, CPA RICH W. COUCH DANA L. NICHOLS President and Chief Executive Officer President and Chief Executive Officer, Executive Vice President, Chief Credit Officer, 37 Years in Banking / Financial Services m2 Lease Funds, LLC 26 Years in Banking / Financial
Slide 31: The Strategic Value of our Separate Charters
The Strategic Value of our Separate Charters • 3 distinct (yet similar) operating charters – able to customize solutions by market • Managed by local veteran bankers, governed by local Board of Directors, local decisions, local solutions, enhanced market specific knowledge • 3 charters supported by
Slide 32: Quad City Bank & Trust
Quad City Bank & Trust Highlights – Quad Cities • The Rock Island Arsenal is the largest government-owned military weapons manufacturing arsenal in the United States John H. Anderson, President & CEO • Alcoa (Quad Cities) is the world’s premier aerospace supply plant – the hub of Alcoa’s $3B aerospa
Slide 33: Cedar Rapids Bank & Trust
Cedar Rapids Bank & Trust Highlights - Cedar Rapids • International Headquarters for Rockwell Collins • U.S. Headquarters for Aegon USA • Downtown Revitalization – Double Tree by Hilton Cedar Rapids Larry J. Helling, President & CEO Convention Complex $144MM, 2 year project resulted in 100,000 sq/ft
Slide 34: Rockford Bank & Trust
Rockford Bank & Trust Highlights - Rockford • AAR (largest aircraft maintenance company in North America, and third largest in the world) will open a new facility at Chicago Rockford Airport generating jobs for 500 people Thomas D. Budd, President & CEO • Rock Valley College building $5.1MM aviation
Slide 35: Community Bank & Trust
Community Bank & Trust Highlights – Waterloo/Cedar Falls • John Deere investing $40MM in its tractor testing labs, adding 62,000 sq/ft of additional space Stacey J. Bentley, President & CEO • John Deere recently completed $150MM modernizationof John Deere Foundry – total Assets: $120 Million* (as of
Slide 36: Non-GAAP Reconciliations
Non-GAAP Reconciliations Tangible Common Equity to Tangible Assets and Tangible Book Value Per Share As of and for the As of and for the Year Ended Quarter Ended December 31, March 31, ($ in thousands, except per share data) 2009 2010 2011 2012 2013 2014 2014 2015 Tangible common equity Total equity