Beacon Financial Corporation · NYSE:BBT
Beacon Financial — Berkshire Hills Bancorp — Investor Presentation (August 2015)
22 slides from Beacon Financial's investor presentation, Aug 11, 2015
Slide 1: Investor Deck August 2015
BERKSHIRE HILLSBANCORP a Berkshire Bank - America’s Most Exciting Banke Tavestor Deck August 2015 Life is exciting. Let us help.
Slide 2: Who We Are
Who We Are Full service regional bank with a distinctive brand and culture, strong middle market opportunities, a solid foundation and ongoing momentum Assets: $7.5 billion Loans: $5.3 billion Deposits: $5.3 billion Wealth AUM: $1.4 billion Core Revenue: $280 million (Q2 annualized) Branches: 93 Foo
Slide 3: 1H15 Strategic Highlights
1H15 Strategic Highlights Solid core earnings growth and improving profitability Grew core EPS in each of the last 6 quarters Ongoing sequential improvements in core ROE and core ROA Announced and closed acquisition of specialty lender Firestone Financial (announced May 22 and closed August 7, 2015)
Slide 4: Well Positioned Footprint in Attractive Markets
Well Positioned Footprint in Attractive Markets Only regional bank operating across this central footprint Favorable positioning in rural markets 4
Slide 5: AMEB Culture
AMEB Culture People, attitude and energy RIGHT core values – Respect, Integrity, Guts, Having Fun and Teamwork Engaging and innovative customer experience Driven to make a difference 5
Slide 6: Talent Recruitment Drives Growth
Talent Recruitment Drives Growth Success with recruited teams driving growth and profitability Key Characteristics Established, well respected talent formerly attached to large banks focused outside our regions Solid relationships within community Strong integration within and across business lines
Slide 7: Double Digit Loan Growth
Double Digit Loan Growth $ Millions 17% 10% 27% 21% 19% total loan growth LTM 8% organic total loan growth LTM Leveraging deal flow from team recruitment Targeted reductions in auto and mortgage portfolio to manage margin and asset sensitivity goals Continued market share growth Healthy pipeline goi
Slide 8: Diversified Deposit Growth Strategies
Diversified Deposit Growth Strategies 8% annualized increase in organic total deposits YTD 5% decrease in cost of deposits YTD Organic account growth, DDA focus 11% annualized organic growth in DDA’s YTD Diversifying deposit sources Branch consolidations/relocations improving market positioning 7 co
Slide 9: Diversified Revenue Drivers
Diversified Revenue Drivers Emphasis on building fee income and enhancing cross-sell initiatives Spotlight on WM Regional hires in E. MA and NY $1.4 billion in AUM Solid referral pipeline Spotlight on Small Biz Re-engineered across footprint Pipeline doubled y/y Risen to top 3 in SBA loans in severa
Slide 10: Firestone Financial Acquisition
Firestone Financial Acquisition On August 7, 2015 Berkshire closed the acquisition of specialty lender Firestone Financial. With $200 million in assets, Firestone is operating as a wholly owned subsidiary of Berkshire Bank and provides secured installment loan equipment financing for small and mediu
Slide 11: Focused on Long-term Profitability Goals and Building Shareholder Value
Focused on Long-term Profitability Goals and Building Shareholder Value Grew core EPS 2% q/q and 16% y/y Sequential improvements in core ROE and ROA NIM expanding ex-accretion due to improved loan yields and funding mix Efficiency ratio of 61.5% - with goal of returning to sub-60% Focused on asset s
Slide 12: Why Invest in Us
Why Invest in Us Strong core earnings momentum Diversified revenue drivers and controlled expenses Well positioned footprint in attractive markets AMEB culture – results driven Solid internal capital generation supports growth Focused on long-term profitability goals and shareholder value Acquisitio
Slide 13: Appendix
Appendix Hampden Bank Acquisition Focus on Building Infrastructure Focus on Expenses Focus on Asset Liability Management Redefining Customer Engagement Financial Performance and Goals Non-GAAP Reconciliation 13
Slide 14: Hampden Bank Acquisition
Hampden Bank Acquisition On April 17, 2015 Berkshire closed the in-market acquisition of Hampden Bancorp (HBNK) in an all-stock transaction. The combined franchise now has 17 branches in the Greater Springfield area, a top 5 deposit market share position and a market cap exceeding $800 million. 14 F
Slide 15: Focus on Building Infrastructure
Focus on Building Infrastructure National showcase for Archer risk/enterprise management solution Expanded financial planning and analysis resources for data driven management New retail loan originations platform implemented across footprint and virtual channel Installed top ranked loan analytics s
Slide 16: Focus on Expenses
Focus on Expenses Efficiency ratio of 61.5% - with goal of returning to sub-60% 26 branches closed, consolidated or sold since 2011 7 branches consolidated in 1H15; 1 sold (expected close 4Q15) Additional branches under review New branches are smaller and more efficient 10% cost saves and 10% revenu
Slide 17: Focus on Asset Liability Management
Focus on Asset Liability Management Targeting to protect and enhance income when rate/credit cycle turns Active balance sheet management –cost of funds down 4% Y/Y Q2 2014 branch purchase added 11% to deposits – a stable, rural , low cost funding addition Near term margin compression with conservati
Slide 18: Redefining Customer Engagement
Redefining Customer Engagement Focused on enhancing both traditional and non-traditional methods Engaging Branches Friendlier pods replace teller lines Automated cash handling – lowers cost and improves customer engagement Community rooms bring in traffic Universal bankers create one stop shop for p
Slide 19: Financial Performance and Goals
Financial Performance and Goals 2012 2013 2014 6mos15 Financial Goals Core revenue growth 40% 13% 7% 8% y/y 7 - 10%+ ann Net interest margin 3.62% 3.63% 3.26% 3.24% 3.30%+ Fee income/revenue 26% 22% 24% 23% 30% Efficiency ratio 59% 61% 63% 62% < 60% Core ROA 0.98% 0.88% 0.73% 0.79% 1%+ Core ROE 7.5%
Slide 20: Non-GAAP Reconciliation
Non-GAAP Reconciliation Note: Core results exclude acquisition, divestiture, systems conversion, accounting correction, discontinued operations and restructuring net charges after tax 20 (Dollars in thousands) 2012 2013 2014 1H15 Net income 33,188 $ 41,143 $ 33,744 $ 18,803 $ Non-core revenue (net)
Slide 21: Forward Looking Statements
Forward Looking Statements This document contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. There are several factors that could cause actual results to differ significantly from expectations described in the forward-looking statements. For a disc
Slide 22: If you have any questions, please contact
If you have any questions, please contact: Allison O’Rourke 99 North Street Pittsfield, MA 01202 Investor Relations Officer (413) 236-3149 aorourke@berkshirebank.com
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