Peapack-gladstone Financial Corporation · NASDAQ:PGC
Peapack-gladstone Financial — Debt Investor Presentation (December 2020)
37 slides from Peapack-gladstone Financial's debt investor presentation, Dec 23, 2020
Slide 1: Subordinated Notes Offering December 2020
Subordinated Notes Offering December 2020 Peapack-Gladstone Bank Exhibit 99.2
Slide 2: Disclaimer
Disclaimer This presentation may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are not historical facts and include expressions about management’s confidence and strategies and management’s expectations about new and ex
Slide 3: Disclaimer (Continued)
Disclaimer (Continued) Further, given its ongoing and dynamic nature, it is difficult to predict the full impact of the COVID-19 outbreak on our business. The extent of such impact will depend on future developments, which are highly uncertain, including when the coronavirus can be controlled and ab
Slide 4: Terms of the Proposed Offering
Terms of the Proposed Offering Issuer Peapack-Gladstone Financial Corporation (“PGC” or the “Company”), holding company of Peapack-Gladstone Bank (“Bank”) Security Subordinated Notes due 2030 Amount $75 Million Offering Structure Fixed-to-Floating Rate (Fixed During First Five Years) Issuance Type R
Slide 5: Investment Considerations
Proven management team with track record of success Diverse revenue streams with significant noninterest income from wealth management business 33% of total revenue for the nine months ended September 30, 2020 Robust digital strategy launched to enable clients to conduct business when, where, and wi
Slide 6: Experienced Leadership Team
Experienced Leadership Team Douglas L. Kennedy President & Chief Executive Officer 908.719.6554 40 years experience; Before joining in 2012, he served as President of the NJ Market for Capital One Bank. He has held key executive level positions and had great success building formidable regional and
Slide 7: Franchise Overview and Financial Highlights
Financial Highlights Branch Map Franchise Overview Note: Financial data as of or for the 9 months ended 09/30/2020. Private Banking Offices Bedminster, NJ Morristown, NJ Princeton, NJ Teaneck, NJ Greenville, DE (Trust Subsidiary) New Providence, NJ Summit, NJ Bonita Springs, FL Headquarters Bedminst
Slide 8: Strategy and Business Lines Overview
Focus on commercial banking with private bankers focused on providing high-touch client service through an advice-based approach encompassing commercial and industrial (C&I) lending, wealth management, depository services, electronic banking, and other commercial real estate lending, and corporate a
Slide 9: Attractive Geographic Footprint
Attractive Geographic Footprint PGC Operates in Some of the Wealthiest Counties in the United States Note: Branch/Deposit Share per FDIC as of 06/30/2020 Deposit Market Share Somerset County $130K 9 #2 Morris County $121K 6 #7 Hunterdon County $119K 3 #5 County Median Household Income # of PGB Branc
Slide 10: Historical Balance Sheet Growth
Total Loans (in billions)* Total Assets (in billions)* Shareholders Equity (in millions) Total Deposits (in billions) Historical Balance Sheet Growth *9/30/2020 includes PPP loans of $202 million in total loans.
Slide 11: Diversified Loan Portfolio
Diversified Loan Portfolio Gross Loans: $4.5 billion Note: Gross loans include loans held for sale; C&I includes Owner-Occupied CRE, which was 6% of the total loan portfolio as of 9/30/2020 Loan Mix as of 09/30/2020 Historical Loan Composition
Slide 12: Diversification within C&I Lending
Diversification within C&I Lending As of 9/30/2020 C&I loans (excluding PPP loans) constitute 38% of the total loan portfolio Avg. Loan Size $1.1MM DSCR 1.64x
Slide 13: Well-Seasoned Diversified Multifamily Loan Portfolio
Well-Seasoned Diversified Multifamily Loan Portfolio As of 9/30/2020 Multifamily Portfolio Balance % (in $MM's) NY (Rent Regulated) $404 34.6% NY (Market Rent) $37 3.2% NJ (Rent Regulated) $301 25.7% NJ (Market Rent) $152 13.0% PA (Rent Regulated) $19 1.6% PA (Market Rent) $256 21.9% TOTAL $1,169 10
Slide 14: Well-Diversified Non-Owner Occupied CRE Portfolio
A Well-Diversified Non-Owner Occupied CRE Portfolio As of 9/30/2020 Non-Owner Occupied CRE loans constitute 16% of the total loan portfolio Avg. Loan Size $2.3MM LTV 54.7% DSCR 1.66x Debt Yield 13.0%
Slide 15: Deferrals within Sectors with Elevated COVID Residual Risk
Deferrals within Sectors with Elevated COVID Residual Risk Estimated at 2% of Total Loans “Highly Impacted” residual sectors highlighted in green Overall Peak deferrals of $934MM during June The sectors designated by management to have elevated COVID residual risk total $314MM, ~7% of Total Loans (a
Slide 16: Rapid Roll-Off of Remaining Deferred Loans
Rapid Roll-Off of Remaining Deferred Loans Through Year End (Deferrals through October 31, 2020) Note: November 2020 column based on actual results; December 2020 and 2021 columns assume that all deferrals roll-off without any further deferral requests or payment issues
Slide 17: Risk Mitigants within Sectors with Elevated COVID Residual Risk
Risk Mitigants within Sectors with Elevated COVID Residual Risk Hospitality First mortgages on flagged properties located in NJ/NY with experienced multi-property operators. Monitoring individual property performance along with market specific data in terms of vacancy and average daily rates. Food S
Slide 18: Risk Mitigants within Sectors with Elevated COVID Residual Risk
Risk Mitigants within Sectors with Elevated COVID Residual Risk Note: With regards to the above table, balances are as of September 30, 2020 and deferrals are as of October 31, 2020; With regards to the above graph, November 2020 column based on actual results; December 2020 and 2021 columns assume
Slide 19: Historical Credit Quality
NPAs / Assets (%)* NPLs / Gross Loans (%) NCOs / Average Loans (%)** Reserves / Gross Loans (%) Historical Credit Quality *Excludes restructured loans and one $10MM HFS commercial loan at September 30, 2020. ** 2020 YTD for the nine months ended 9/30/2020
Slide 20: Workout and Asset Recovery Efforts Reduced Classified Assets
$63.6 MM $41.3 MM ($20.5) MM ($7.1) MM $5.3 MM Workout and Asset Recovery Efforts Reduced Classified Assets in Q3 1.30% of total gross loans 0.93% of total gross loans
Slide 21: Special Mention (Criticized) Loans Increase
Loans in Sectors with Elevated COVID Residual Risk Drive Increase in Special Mention (Criticized) $28.0 MM $129.7 MM ($2.8) MM $24.2 MM $46.8 MM ($5.0) MM $20.2 MM $18.3 MM LTV = 52% DSCR = 1.60x LTV = N/A DSCR = 1.92x LTV = 61% DSCR = 1.57x (Special Mention) (Special Mention)
Slide 22: Conservatively Building Our Reserves
Conservatively Building Our Reserves in light of Inherent Risks with the Current Economic Environment $43.7 MM $66.1 MM ($6.2) MM $8.5 MM $21.5 MM 0.99% 1.49% Total ALLL Coverage % ($1.4) MM
Slide 23: Key Profitability Ratios
Noninterest Income / Operating Revenue Return on Average Assets (%) GAAP Efficiency Ratio (%) Net Interest Margin (%) Key Profitability Ratios Note: 2020 YTD for the nine months ended 9/30/2020
Slide 24: Diversified Revenue Mix
* Includes SBA Income, Swap Income, Deposit & Loan Fees, Mortgage Banking, and BOLI. Net Interest Income 67% Wealth Management Fees 21% Fees & Other Income 12% Nine Months Ended 09/30/2020 Net Interest Income before Provision Wealth Management Fee Income Fees & Other Income* Total Non-Interest Incom
Slide 25: Deposit Composition
Deposit Composition Total Deposits: $4.9 billion *Jumbo Time defined as time deposits greater than $250,000 **Excludes jumbo time deposits greater than $250,000 Source: S&P Global Market Intelligence Deposit Mix as of 09/30/2020 Historical Deposit Composition
Slide 26: Liquidity and Securities Portfolio
Liquidity and Securities Portfolio As of 9/30/2020 Highlights Overview Cash and due totaled $8 million, or 0.14% of assets Interest bearing deposits at banks of $671 million represented 11.3% of assets Total AFS Securities were $597 million, or 10.0% of assets Modified duration of 2.3 years Unrealiz
Slide 27: Interest Rate Risk Sensitivity
Interest Rate Risk Sensitivity As of 9/30/2020 Net Interest Income 1 Year Impact (%) Net Interest Income 2 Year Impact (%) Note: Based on a 12-month simulation Source: Company documents
Slide 28: Sources of Liquidity and Current Debt Profile
Sources of Liquidity and Current Debt Profile Cash and cash equivalents of $679 million as of September 30, 2020 Cash and cash equivalents at the holding company of $15 million $597 million in securities designated as available for sale at September 30, 2020 Securities available for sale with a fair
Slide 29: Historical Capital Ratios
Historical Capital Ratios * Excludes PPP loans of $202 million Source: S&P Global Market Intelligence; 2020 YTD as of 9/30/2020 Holding Company Capital Ratios Bank Level Capital Ratios
Slide 30: Pro Forma Capital Ratios
Pro Forma Capital Ratios Holding Company * Excludes PPP loans of $202 million Note: Assumes a $75 million subordinated debt issuance, full redemption of existing subordinated debt of $50 million callable on 6/30/2021, and ~$1.4 million of offering-related expenses; assumes 20% risk-weighting on proc
Slide 31: Double Leverage and Interest Coverage
Double Leverage and Interest Coverage *Assumes a $75 million subordinated debt issuance with none of the proceeds downstreamed to the bank and ~$1.4 million of offering-related expenses **Assumes interest expense on new debt of 4.50% annual coupon *** Assumes redemption of $50 million of existing su
Slide 32: Summary of Investment Highlights
Proven management team with track record of success Diverse revenue streams with significant noninterest income from wealth management business Robust digital strategy launched to enable clients to conduct business when, where, and with whom they want Niche wealth management and commercial banking s
Slide 33: Appendix
Appendix Peapack-Gladstone Bank
Slide 34: A High-Performing Boutique Bank
A high-performing boutique bank, leaders in wealth, lending and deposit solutions, known nationally for our unparalleled client service, integrity and trust Professionalism Clients First Compete to Win Invested in Our Community One Team Vision Senior Private Bankers lead a team-based approach PGB of
Slide 35: Historical Balance Sheet
PEAPACK-GLADSTONE FINANCIAL CORPORATION Historical Balance Sheet Dollars in thousands [As of Year Ended December 31, Quarter Ended, 2016 2017 2018 2019 9/30/2020 ‘Cash and Due from Banks 24,580 4ais 5914 6591 8400 Fed Funds Sold 101 101 101, ‘102 102 Interest-Earning Deposits 138010 108,931 154,758
Slide 36: Historical Income Statement
Historical Income Statement
Slide 37: Wealth Management Q3 2020 Update
Our Vision: A leading wealth management boutique, offering superior advice delivered by top quality professionals, with a differentiated client experience compared to large bank competitors. Q3 2020: AUMs/AUAs at 09/30/2020 were a record $7.6B, which includes YTD gross client inflows of $528MM. Weal
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