Customers Bancorp, Inc · NYSE:CUBI
Customers Bancorp — Investor Presentation (February 2014)
30 slides from Customers Bancorp's investor presentation, Feb 24, 2014
Slide 1: Focused on Delivering Profitable Growth
Focused on Delivering Profitable Growth Investor Presentation February 2014 NASDAQ: CUBI
Slide 2: Forward-looking statements
This presentation as well as other written or oral communications made from time to time by us, may contain certain forward-looking information within the meaning of the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended. These statements relate to future events
Slide 3: Forward-looking statements (continued)
timely development and acceptance of new banking products and services and perceived overall value of these products and services by users; volatility in the credit and equity markets and its effect on the general economy; the potential for customer fraud, especially in our mortgage warehouse lendin
Slide 4: Investment Proposition
Investment Proposition § ~$4.2 billion asset bank § Well capitalized at 13% + total risk based capital and 10% + tier 1 leverage § Target market from Boston to Washington D.C. along interstate 95 § ROA of .95% and ROE of 9.49%; eight quarters of record core earnings § 3.18% net interest margin § 165
Slide 5: Current Markets and Company Overview
Current Markets Current Company Overview Source: SNL Financial and Company data. Note: Branch proposed in northeastern Philadelphia. *Source: Company Documents. ~$4.2 bn institution with 18 sales offices with target market from Boston to Washington D.C. Operating in key Mid-Atlantic and Northeast ma
Slide 6: Execution Timeline
Execution Timeline § We join $270 million asset Customers Bank (FKA New Century Bank) § Identified existing credit problems, adequately reserved and recapitalized the bank § Actively worked out very extensive loan problems § Recruited experienced management team § Enhanced credit and risk management
Slide 7: 2013 Revenue Growth and Strong Credit Quality Results in Record Earnings
Net Revenue Before Provision Earnings Highlights Asset Quality 2013 Revenue Growth and Strong Credit Quality Results in Record Earnings § Q4 2013 net income of $9.0 million is up 19% over 4Q 2012 mainly due to net interest income fueled by net loan growth while maintaining high credit quality and al
Slide 8: Disciplined Model for Increasing Shareholder Value
Disciplined Model for Increasing Shareholder Value § Build tangible book value per share each quarter via earnings § Strong organic revenue growth + efficient, scalable infrastructure result in sustainable double digit EPS growth § A clear and simple risk management driven business strategy § Above
Slide 9: Lending Strategy - Local Lending Plus Specialty Niche
Commercial Lending Specialty Lending Lending Strategy - Local Lending Plus Specialty Niche Small Business § Target companies with less than $5.0 million annual revenue § Loans (incl. SBA loans) originated by branch network and specialist small business relationship managers § Banking for Mortgage Co
Slide 10: Customers Bank Advantage: High Touch supported by High Tech
Cash Management Residential Real Estate Credit Cards Commercial Real Estate Commercial Banking Retail Branches Client Makes One Call Client Private / Personal Bankers Concierge Banking Other Products/ Services Customers Bank Advantage High Touch supported by High Tech Single Point of Contact Banking
Slide 11: Single Point of Contact Pays off in Strong Loan and Deposit Growth
Single Point of Contact Pays off in Strong Loan and Deposit Growth § Overcame a $700 million decrease in 2013 from the banking for mortgage companies loans held for sale with growth in multi family/CRE loans of $860 million and commercial and industrial loans growth of $265 million in 2013 § New Ban
Slide 12: Strong Loan Portfolio Growth
Loan Portfolio Mix ($mm) Loan Distribution (3) Strong Loan Portfolio Growth § High credit quality results from Customers’ underwriting standards and conservative loan mix § Centralized credit committee approval for all loans o Average C&I loan < $2.0 million o Average Multi-family loans < $5 million
Slide 13: Deposit Strategy – High Touch, High Tech
Deposit Strategy – High Touch, High Tech Organic deposit growth goals of 20%+ a year Concierge Banking Takes banker to the customer’s home or office, 12 hours a day, 7 days a week Appointment banking approach Customer access to private bankers “Virtual Branches” out of sales offices Sales Force Expe
Slide 14: Deposits: Organic Growth With Controlled Costs
Total Deposit Growth ($mm) Cost of Deposits Deposits: Organic Growth With Controlled Costs Customers strategies of single point of contact and recruiting known teams in target markets produce rapid deposit growth with low total cost
Slide 15: Results in Disciplined & Profitable Growth
Core Net Income (1) Net Interest Income ($mm) Results in Disciplined & Profitable Growth Source: SNL Financial and Company data. (1) Core income, on a diluted per-share basis is net income before extraordinary items, less the after-tax portion of income from investment gains and nonrecurring items.
Slide 16: Strong Capital Levels Enable Growth
Strong Capital Levels Enable Growth § Strong capital enables asset and deposit growth § Customers raised $200+ million of equity capital in past 18 months at book value or better § Current capital levels will provide for over $1.0 billion of growth (assumes risk weighted assets are 90% of total asse
Slide 17: Tangible Book Value Growth
Tangible Book Value Growth Strong Growth Provides for Shareholder Value Creation § Per share tangible book value up 34% since December 2010 § Focused on continuous growth of TBV aligns executive management compensation with shareholder value creation § Strategies and key decisions are framed by esti
Slide 18: Highly Experienced Management Team
Highly Experienced Management Team
Slide 19: Key Financial Targets for the Next 3-5 Years
Criteria 3 -5 Year Targets Year EPS Expectations Key Financial Targets for the Next 3-5 Years § Focus in future years § Single point of contact model - “High touch supported by high tech” § Superior credit quality § Above average organic growth § Expense management § Earnings per share growth estima
Slide 20: Customers Bancorp, Inc.
Customers Bancorp, Inc. @ BankMobile bankmobiy
Slide 21: Summary
Summary § Strong high performing ~$4.2 billion bank with significant growth opportunities § “High touch, high tech” processes and technologies result in superior growth, returns and efficiencies § Shareholder value results from the combination of increasing tangible book value with strong and consis
Slide 22: Comparison - Signature Bank SBNY
Comparison - Signature Bank SBNY Highly successfully bank with similar banking model
Slide 23: Comparison: Texas Capital Bancshares TCBI
Comparison: Texas Capital Bancshares TCBI Highly successfully bank with similar banking model
Slide 24: High Performance Regional Peers
High Performance Regional Peers Peer Group Comparison Source: SNL Financial, Company documents. Market data as of 12/31/13. Consists of Northeast and Mid-Atlantic banks and thrifts with assets between $2.0 billion and $6.0 billion and most recent quarter core ROAA greater than 90bps. Excludes merger
Slide 25: Contacts
Contacts Company Robert Wahlman, CFO Tel: 610-743-8074 rwahlman@customersbank.com www.customersbank.com Investor Relations Ted Haberfield President, MZ North America Tel: 760-755-2716 thaberfield@mzgroup.us www.mzgroup.us
Slide 26: Customers Bancorp, Inc.
Customers 2. Bancorp, Inc.
Slide 27: Consolidated Balance Sheet - Unaudited
Customers Bancorp, Inc. ‘CONSOLIDATED BALANCE SHEET- UNAUDITED (Doles in thousands) December3%, September30, December 3, 13 2013 212 ASSETS (ash and due from banks S 5933 § 8832 $908 Interest earning deposits W379 167321 173,108 CCashand cash equivalents 233,068 255,653 186016 Investment securities
Slide 28: Consolidated Statements of Operations - Unaudited
Customers Bancorp, Inc. ‘GONSOUDATED STATEMENTS OF OPERATIONS - UNAUDITED {Dots tousones, excep peshare doo) a @ a fave ltear loans torte ry ee ee ee) loans recede ndings prot 2a, 430 esa mos10 Investment cities 250 13 ™ eat om Tal itrest income mer Sst ms aisi6 is Depots sm S00 30 00 2076 Feel nds
Slide 29: Average Balance Sheet / Net Interest Margin
Customers Bancorp, Inc. ‘Average Balance Sheet / Net Interest Margin (Dollars in thousands) ‘Three Months Ended December 31, 2013 2012 ‘Average yield ‘Average yield Average Balance or cost (%) ‘Average Balance or cost (%) Assets Interest earning deposits $ 1722 = 0.25% $ 202,176 0.25% Investment sec
Slide 30: Asset Quality as of December 31, 2013
Customers Bancorp, Inc. ‘Asset Quality as of December 34, 2013 (Dollars in thousands) Non Other Real Performing Allowance Total Total Loan Type Non Accrual Estate ‘Assets forloan Credit Cash Credit’ ©—=NPA'S_—Reservesto Total Loans INPL's__ Owned __(NPA’s)_losses_—Mark Reserve Reserves Total Loans T
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