National Bank Holdings Corporation · NYSE:NBHC
National Bank — Q2 2022 Earnings Presentation
45 slides from National Bank's earnings presentation, Jul 20, 2022
Slide 1: Investor Presentation Q2 2022
Investor Presentation Q2 – 2022
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains “forward-looking statements” within the meaning of the Private providers and the risk of systems failures, interruptions or breaches of security; the Company’s Securities Litigation Reform Act of 1995. Forward-looking statements contain words suc
Slide 3: About Non-GAAP Financial Measures
About Non-GAAP Financial Measures Certain of the financial measures and ratios we present, including “tangible assets,” “return on performance and when planning, forecasting, analyzing and comparing past, present and average tangible assets,” “tangible common equity,” “return on average tangible com
Slide 4: Table of Contents
Table of Contents Financial Performance 08 Bank of Jackson Hole and Rock Canyon Bank Acquisitions 13 Credit 18 Balance Sheet 22 2UniFi 26 Management Team 29 Corporate Governance Overview 32 Appendix 40
Slide 5: Attractive Markets
Attractive Markets Headquarters Company Highlights Denver, CO Banking Centers(1) 81 Listing NYSE: NBHC Balance Sheet 2Q22 Total Assets (mm) $7,168 Total Loans (mm) $4,817 Total Deposits (mm) $6,194 Key Ratios YTD22 Common Equity Tier 1 13.8% Tier 1 Leverage 10.5% ROATA(2)(3) 1.11% / 1.14%(4) 40 bank
Slide 6: Recent Recognition
Recent Recognition U.S. News: Best Places to Live Rankings Fortress Balance #1 Sheet Largest Publicly Traded Bank HQ’d in Colorado #2 and #4 Robust Colorado Springs, CO and Profitability Boulder, CO Market Presence in Top 5 Best Places to Live(1) Positioned in #3 Attractive Markets Colorado Ma
Slide 7: Shareholder Returns
Shareholder Returns Total Shareholder Returns For The Past Five Years (6/30/2017 through 6/30/2022) Net Income $88.6 $93.6 ($ in millions) $80.4 Non-Adjusted $67.8 90% Adjusted $6.3 $39.7 $35.0 $1.0 $61.5 70% $20.4 $38.7 $14.6 (2) (2) (2) YE17 YE18 YE19 YE20 YE21 YTD22 50% Historical Dividend Per Sh
Slide 8: Financial Performance
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Slide 9: Q2 2022 Financial Highlights
Q2 2022 Financial Highlights Net Income FTE net interest income totaled a record $57.4 million, an increase of $9.4 $20.4 million / $21.1 million adjusted(2) million, or 78.4% annualized, over 1Q22 Capital Ratios FTE net interest margin widened 48 basis points to 3.38%, due to an 13.8% Common Eq
Slide 10: Profitable Steady Growth
Profitable Steady Growth Net Income $88.6 $93.6 Pre-Provision Net Revenue FTE(1) EPS (Fully Diluted) ($ in millions) ($ in millions) $132.1 $80.4 Non-Adjusted $112.9 $3.01 Non-Adjusted $67.8 $110.8 Adjusted $2.85 $2.55 Adjusted $6.3 $83.4 $2.16 $0.21 $39.7 $35.0 $1.0 $53.7 $54.7 $51.5 $1.30 $1.26 $1
Slide 11: Growth Trends
Growth Trends Total Assets Total Loans Tangible Common Equity(1) ($ in billions) ($ in billions) ($ in millions) $7.2 $7.2 Non-PPP Loans PPP Loans $4.8 $6.7 $728.8 $707.3 $705.3 $4.5 $4.4 $4.4 $5.9 $651.4 $5.7 $4.1 $0.2 $577.4 $4.8 $4.6 $3.2 $4.2 $478.9 $482.0 $2.9 YE16 YE17 YE18 YE19 YE20 YE21 2Q22
Slide 12: Regulatory Capital
Regulatory Capital $371 million in excess capital over 7.0% common Capital Ratios – 2Q22 equity tier 1 risk-based regulatory requirement TIER 1 LEVERAGE 10.5% COMMON EQUITY TIER 1 RISK-BASED 13.8% Double-leverage ratio just 86.8% TIER 1 RISK-BASED 13.8% TOTAL RISK-BASED 15.4% Holding company c
Slide 13: Bank of Jackson Hole and Rock Canyon Bank Acquisitions
Bank of Jackson Hole and Rock Canyon Bank Acquisitions
Slide 14: Strategically Compelling Expansion
Strategically Compelling Expansion Trust and Wealth Partners Rock Canyon SBA Division(1) 25 $173mm 250+ $600mm+ Full-Time Associates 2021 Total Loan Production High Net Worth Clients AUM #1 Utah SBA Rank(2) Trust and Wealth Management solution tailored to high net worth Rock Canyon Bank ranks as
Slide 15: Scale Enhances the NBH Franchise
Scale Enhances the NBH Franchise Pro Forma (dollars in millions) (2) (1) Total Assets $7,214 $1,599 $814 $9,627 Total Loans 4,513 996 494 6,003 Total Deposits 6,228 1,452 737 8,417 Deposits / # of Banking Centers 78 121 105 85 CET1 14.3% 12.0% Tier 1 Leverage 10.4% 9.0% Source: S&P Global Market Int
Slide 16: Enhances Leading Financial Performance
Enhances Leading Financial Performance P / ’23 EPS P / TBV P / ’23 EPS Deal With Synergies Standalone Multiples(1) 1.96x 10.5x 7.5x P / ’23 EPS Deal P / TBV P / ’23 EPS With Synergies Standalone Multiples(2) 1.80x 10.4x 6.7x Combined Pro 25% ~2.6 years 12% Forma(3) 2023 EPS Accretion TBVPS Earnback
Slide 17: Attractive Deployment of Excess Capital
Attractive Deployment of Excess Capital Strong Financial Performance 25% Fully-synergized EPS Accretion Combined = Institution is a Attractive Platform for Shareholder Returns 28% Internal Rate of Return Accelerated Growth and NBH CET1 (%) Estimated Impact Greater Earnings Retaining Strong 14% Distr
Slide 18: Credit
B= National Bank Holdings CORPORATION™
Slide 19: Uniquely Diversified $4.8 Billion Loan Portfolio
Uniquely Diversified $4.8 Billion Loan Portfolio Concentrations Granular and Well-Diversified Loan Portfolio Consumer 16% C&I and Self-imposed concentration limits ensure a granular and diverse loan portfolio and Owner protect against downside risk to any particular industry or real estate sector
Slide 20: Strong Credit Quality History
Strong Credit Quality History Allowance for loan losses coverage equal to 516% of non-performing loans Acquisition fair value marks on acquired loans total $4.7 million, 3.8% of acquired loans or 0.1% of total loans Non-performing Loans Non-performing Asset Composition ($ in millions) 0.49% 0.47
Slide 21: Allowance For Credit Loss
Allowance For Credit Loss Allowance to total loan coverage of 1.06% provides coverage for economic uncertainty We hold $4.7 million in fair value marks on acquired loans which equates to 0.10% of the total loan portfolio ACL/Total Loans ACL/Total Loans 1.10% 1.06% $49.7 $50.9 ACL(1) ACL(1) 12/31
Slide 22: Balance Sheet
BE National Bank Holdings CORPORATION™ Balance Sheet
Slide 23: Solid Loan Growth
Solid Loan Growth Total Loan Fundings(1) Quarterly Loan Fundings Loan Composition ($ in billions) ($ in millions) ($4.8 Billion) $1.8 $475.4 $492.5 $1.5 $413.3 $419.7 Owner Occupied CRE $362.1 $1.2 $1.2 $1.2 17% $1.0 CRE $0.9 C&I 13% 54% Resi Mortgage 15% TTM 2Q21 3Q21 4Q21 1Q22 2Q22 Other Consumer
Slide 24: High Quality, Highly Liquid Investment Portfolio
High Quality, Highly Liquid Investment Portfolio $1.4 Billion Investment Portfolio(1) 0.2% 99.8% of portfolio is U.S. agency/sponsored 7.4% agency and U.S. Treasury backed U.S. Agency/Sponsored Agency MBS 2Q22 yield of 1.61% 39.3% U.S. Agency/Sponsored Agency CMO 42% of portfolio in Held-to-Ma
Slide 25: Low Cost Transaction Deposits
Low Cost Transaction Deposits Growing Low Cost Transaction Accounts Deposit Composition ($ in billions) Demand & NOW Savings & MM CDs < $250k CDs >= $250k Total Average Transaction Deposits Average Time Deposits $5.4 $5.1 $4.7 $5.7 $6.2 $6.2 100% 3% 3% 2% 2% $4.2 14% 11% 11% 19% $3.6 36% 37% 38% 37%
Slide 26: 2UniFi
F National Bank Holdings CORPORATION™ 2UniF i
Slide 27: Mission
Mission To help small and medium sized businesses: • Increase their access to the US Banking System • Reduce their costs while saving time • Increase their actionable information With the goal of reducing stress in the lives of business owners and operators. 27
Slide 28: Delivering an Innovative SMB Marketplace and Platform
Delivering an Innovative SMB Marketplace and Platform 28
Slide 29: Management Team
BE National Bank Holdings Management Team
Slide 30: Experienced Management Team
Experienced Management Team Tim Laney Aldis Birkans Chairman, President & CEO Chief Financial Officer (41 years in banking) (24 years in financial industry) • Head of Business Services at Regions Financial, where he also led the transformation • Senior Vice President, Treasurer at NBHC of wholesale
Slide 31: Management & Directors
Management & Directors Beneficial Ownership (as of 6/30/22) NBHC MANAGEMENT & DIRECTORS BENEFICIAL OWNERSHIP(1) PERCENT OF CLASS(2) G. Timothy Laney 558,961 1.84% Aldis Birkans 68,315 0.23% Richard U. Newfield, Jr. 167,021 0.55% Angela Petrucci 17,807 0.06% Ralph W. Clermont 84,848 0.28% Robert E. D
Slide 32: Corporate Governance
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Slide 33: Best Practices In Governance and Compensation
Best Practices In Governance and Compensation NBHC’s corporate governance policies and executive compensation practices support our business and align with best practices Corporate Governance Executive Compensation Lead Independent Director with robust role and responsibilities Provide the major
Slide 34: NBHC Board of Directors
NBHC Board of Directors G. Timothy Laney Robust Lead Director President, CEO and Chairman Former Sr Executive VP & Head of Business Responsibilities Services at Regions Financial 24-year tenure at Bank of America, and a member of Bank of America’s Management Operating Committee Mr. Clermont
Slide 35: NBHC Board Represents a Diverse Range of Qualifications and Skills
NBHC Board Represents a Diverse Range of Qualifications and Skills Experience or Number of Directors Expertise CEO or President of Private or Public 5 Company Experienced leaders capable of overseeing Other Public Board execution and Experience 4 challenging management Financial or Audit Background
Slide 36: Board's Role in Oversight of Risk
Board’s Role in Oversight of Risk The Board is actively engaged in NBHC’s risk management. Robust Risk Oversight at Board Level Risk Board Oversight Actions Cybersecurity NBHC Audit and Risk Committee is responsible for oversight Employs detection and response mechanisms designed to Evolving nature
Slide 37: Overview of NBH Bank Board of Directors
Overview of NBH Bank Board of Directors In addition to the NBHC Board, there is an added layer of oversight through the Board of Directors of NBH Bank, NBHC’s wholly-owned subsidiary NBH Bank Board Composition Aldis Birkans Christopher Randall Chief Financial Officer EVP, Commercial, Specialty and B
Slide 38: Executive Compensation Program
Executive Compensation Program NBH’s executive compensation practices align management incentives with long-term shareholder interests Components of Executive Compensation (2021) Compensation Metrics Tied to Long-Term Strategy Component Metrics Link to Strategy Base Salary • Among other things, attr
Slide 39: Environmental, Social and Governance (ESG) Matters
Environmental, Social and Governance (ESG) Matters NBH’s long-standing commitment to ESG in all of its business activities Committed to using environmentally friendly office products and materials and optimizing our office and banking center space. Environmental Continued investment in our mobil
Slide 40: Appendix
B= National Bank Holdings CORPORATION™ Appendix
Slide 41: Reconciliation of Non-GAAP Measures
Reconciliation of Non-GAAP Measures ($ in millions, except per share) As of and for the six months ended As of and for the years ended Return on Average Tangible Assets and Return on Average Tangible Equity 30-Jun-22 31-Dec-21 31-Dec-20 31-Dec-19 31-Dec-18 31-Dec-17 31-Dec-16 Net income $ 38.7 $ 93.
Slide 42: Reconciliation of Non-GAAP Measures (cont'd)
Reconciliation of Non-GAAP Measures (cont’d) As of and for the As of and for the six ($ in millions, except per share) three months ended months ended As of and for the years ended Adjusted Financial Results 30-Jun-22 30-Jun-22 31-Dec-18 31-Dec-17 Adjustments to net income: Net income $ 20.4 $ 38.7
Slide 43: Reconciliation of Non-GAAP Measures (cont'd)
Reconciliation of Non-GAAP Measures (cont’d) AsAsof of andand for for the As of and for the three three months As of the andsix for the ($ in millions, except per share) monthsendedended six monthsended months ended As of and for the years ended Efficiency Ratio 30-Jun-22 30-Jun-22 31-Dec-21 31-Dec-
Slide 44: Reconciliation of Non-GAAP Measures (cont'd)
Reconciliation of Non-GAAP Measures (cont’d) ($ in millions, except per share) As of and for the six months ended As of and for the years ended Tangible Common Book Value Ratios 30-Jun-22 31-Dec-21 31-Dec-20 31-Dec-19 31-Dec-18 31-Dec-17 31-Dec-16 Total shareholders' equity $ 815.6 $ 840.1 $ 820.7 $
Slide 45: Thank you.
BE National Bank Holdings CORPORATION™ ie a | Thank you.
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